SUNAMERICA SERIES TRUST, 485APOS, 1996-03-15

SUNAMERICA SERIES TRUST
485APOS, 1996-03-15

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<PAGE> 1

As filed with the Securities and Exchange Commission on March 15, 1996

File Nos. 33-52742; 811-7238
================================================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933 / /
PRE-EFFECTIVE AMENDMENT NO. / /

POST-EFFECTIVE AMENDMENT NO. 7 /X/

AND/OR
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 / /

AMENDMENT NO. 9 /X/

(CHECK APPROPRIATE BOX OR BOXES)

SUNAMERICA SERIES TRUST
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)

1 SunAmerica Center, Century City
Los Angeles, CA 90067-6022
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE)(ZIP CODE)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (800) 858-8850

Robert M. Zakem, Esq.
Senior Vice President and General Counsel
SunAmerica Asset Management Corp.
The SunAmerica Center
733 Third Avenue
New York, NY 10017-3204
(NAME AND ADDRESS OF AGENT FOR SERVICE)

Copies to:

Susan L. Harris, Esq. Margery K. Neale
SunAmerica Inc. Shereff, Friedman, Hoffman & Goodman LLP
1 SunAmerica Center, Century City 919 Third Avenue
Los Angeles, CA 90067-6022 New York, NY 10022

IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE BOX)

<TABLE>
<S> <C>
/ / immediately upon filing pursuant to paragraph (b) / / on (date) pursuant to paragraph (b)
/X/ 75 days after filing pursuant to paragraph (a) / / on (date) pursuant to paragraph (a) of Rule 485
</TABLE>

--------------------

The Registrant has elected to register an indefinite number of shares
of beneficial interest, without par value, under the Securities Act of 1933
pursuant to Rule 24f-2 under the Investment Company Act of 1940, as amended.
The Rule 24f-2 Notice for the Registrant's fiscal year ended November 30, 1995
was filed on January 23, 1996.
================================================================================
<PAGE> 2
SUNAMERICA SERIES TRUST

CROSS REFERENCE SHEET
Pursuant to Rule 481(a)
Under the Securities Act of 1933

<TABLE>
<CAPTION>
PART A
Item No. Registration Statement Caption Caption in Prospectus
- -------- ------------------------------ ---------------------
<S> <C> <C>

1. Cover Page Cover Page

2. Synopsis *

3. Financial Highlights *

4. General Description of Registrant The Trust; Its Investment Objectives and
Policies; Description of Securities &
Investment Techniques

5. Management of the Fund Management

6. Capital Stock and Other Securities Dividends, Distributions and Federal Taxes;
Shareholder Voting Rights; Shareholder
Inquiries

7. Purchase of Securities Being Offered Purchase of Shares; Purchases and
Redemptions

8. Redemption or Repurchase Purchases and Redemptions

9. Pending Legal Proceedings *

<CAPTION>
PART B Caption in Statement
Item No. Registration Statement Caption of Additional Information
- -------- ------------------------------ -------------------------
<S> <C> <C>

10. Cover Page Cover Page

11. Table of Contents Table of Contents

12. General Information and History The Trust

13. Investment Objectives and Policies Investment Policies;
Investment Restrictions

14. Management of the Fund Trust Officers and Trustees

15. Contact Persons and Principal Holders The Trust
of Securities

16. Investment Advisory and Other Services Management;
General Information

17. Brokerage Allocation Execution of Portfolio Transactions

18. Capital Stock and Other Securities *

19. Purchase, Redemption and Pricing of Price of Shares
Securities Being Offered

20. Tax Status Dividends, Distributions and Federal Taxes

21. Underwriters *

22. Calculation of Performance Data *

23. Financial Statements *
</TABLE>

- -------------
* Omitted from the Prospectus or Statement of Additional Information because
the item is not applicable.

PART C
The information required to be included in Part C is set forth under
the appropriate item, so numbered in Part C of this Registration Statement.
<PAGE> 3

PROSPECTUS - JUNE , 1996

- --------------------------------------------------------------------------------

SUNAMERICA SERIES TRUST

- --------------------------------------------------------------------------------
P.O. BOX 54299
LOS ANGELES, CALIFORNIA 90054-0299

SunAmerica Series Trust ("Trust") is an open-end management investment
company. The Trust consists of 18 Portfolios, each of which has its own
investment objectives and policies.

The CASH MANAGEMENT PORTFOLIO seeks high current yield while preserving
capital by investing in a diversified selection of money market instruments.

The CORPORATE BOND PORTFOLIO seeks a high total return with only moderate
price risk by investing primarily in investment grade fixed-income securities.

The GLOBAL BOND PORTFOLIO seeks a high total return, emphasizing current
income and, to a lesser extent, providing opportunities for capital
appreciation, through investment in high quality fixed-income securities of U.S.
and foreign issuers and through transactions in foreign currencies.

The HIGH-YIELD BOND PORTFOLIO seeks a high level of current income and
secondarily seeks capital appreciation by investing primarily in intermediate
and long-term corporate obligations, with emphasis on higher-yielding,
higher-risk, lower-rated or unrated securities.

The WORLDWIDE HIGH INCOME PORTFOLIO seeks high current income and,
secondarily, capital appreciation, by investing primarily in a portfolio of
high-yielding fixed-income securities of issuers located throughout the world.

The UTILITY PORTFOLIO seeks high current income and moderate capital
appreciation by investing primarily in the equity and debt securities of utility
companies.

The BALANCED/PHOENIX INVESTMENT COUNSEL PORTFOLIO seeks reasonable income,
long-term capital growth and conservation of capital by investing primarily in
common stocks and fixed-income securities, with an emphasis on income-producing
securities which appear to have some potential for capital enhancement.

The SUNAMERICA BALANCED PORTFOLIO seeks to conserve principal by
maintaining at all times a balanced portfolio of stocks and bonds.

The ASSET ALLOCATION PORTFOLIO seeks high total return (including income
and capital gains) consistent with preservation of capital over the long-term
through a diversified portfolio that can include common stocks and other
securities having common stock characteristics, bonds and other intermediate and
long-term fixed-income securities and money market instruments (debt securities
maturing in one year or less) in any combination.

THE HIGH-YIELD BOND AND WORLDWIDE HIGH INCOME PORTFOLIOS INVEST
PREDOMINANTLY IN, AND THE CORPORATE BOND, BALANCED/PHOENIX INVESTMENT COUNSEL
AND ASSET ALLOCATION PORTFOLIOS MAY INVEST IN, LOWER-RATED AND UNRATED BONDS.
BONDS OF THIS TYPE ARE TYPICALLY SUBJECT TO GREATER MARKET FLUCTUATIONS AND RISK
OF LOSS OF INCOME AND PRINCIPAL DUE TO DEFAULT BY THE ISSUER THAN ARE
INVESTMENTS IN LOWER-YIELDING, HIGHER-RATED BONDS. SEE "DESCRIPTION OF
SECURITIES AND INVESTMENT TECHNIQUES -- RISK FACTORS RELATING TO HIGH-YIELD
BONDS" FOR A DISCUSSION OF THE RISKS ASSOCIATED WITH HIGH-YIELD, HIGH-RISK
SECURITIES.

(Cover continued on next page)

------------------------

As a result of the market risk inherent in any investment, there is no
assurance that the investment objective of any of the Portfolios will be
realized. INVESTMENTS IN A PORTFOLIO ARE NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT OR ANY OTHER ENTITY OR PERSON.

This Prospectus sets forth concisely the information a prospective investor
ought to know before investing in the Trust. Please read it carefully and retain
it for future reference. Further information about the performance of the
Portfolios is contained in the Trust's Annual Report to Shareholders. A
Statement of Additional Information has been filed with the Securities and
Exchange Commission. The Annual Report to Shareholders and the Statement of
Additional Information may be obtained upon request and without charge by
writing to the Trust at the above address or by calling 1-800-445-7862.

------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
------------------------

<PAGE> 4

(Cover continued from previous page)

The GROWTH-INCOME PORTFOLIO seeks growth of capital and income by investing
primarily in common stocks or securities which demonstrate the potential for
appreciation and/or dividends.

The ALLIANCE GROWTH, GROWTH/PHOENIX INVESTMENT COUNSEL and PROVIDENT GROWTH
PORTFOLIOS each seeks long-term growth of capital by investing primarily in
common stocks or securities with common stock characteristics which demonstrate
the potential for appreciation.

The FEDERATED VALUE PORTFOLIO seeks growth of capital and income by
investing primarily in the securities of high quality companies.

The VENTURE VALUE PORTFOLIO seeks to achieve growth of capital by investing
primarily in common stocks.

The AGGRESSIVE GROWTH PORTFOLIO seeks capital appreciation by investing
primarily in equity securities of small capitalization growth companies.

The GLOBAL EQUITIES PORTFOLIO seeks long-term growth of capital through
investment primarily in common stocks or securities of U.S. and foreign issuers
with common stock characteristics which demonstrate the potential for
appreciation and through transactions in foreign currencies.

The INTERNATIONAL DIVERSIFIED EQUITIES PORTFOLIO seeks long-term capital
appreciation by investing in accordance with country weightings determined by
the Subadviser in common stocks of foreign issuers which, in the aggregate,
replicate broad country indices.

Shares of the Trust are issued and redeemed only in connection with
investments in and payments under variable annuity contracts and may be sold to
fund variable life contracts issued in the future. The contracts involve fees
and expenses not described in this Prospectus and also may involve certain
restrictions or limitations on the allocation of purchase payments or contract
values to one or more series of the Trust. Certain Portfolios may not be
available in connection with a particular contract. See the applicable contract
prospectus for information regarding contract fees and expenses and any
restrictions or limitations.

<PAGE> 5

TABLE OF CONTENTS

<TABLE>
<CAPTION>
TOPIC PAGE
-----
<S> <C>
FINANCIAL HIGHLIGHTS...................................................................... 4
THE TRUST, ITS INVESTMENT OBJECTIVES AND POLICIES......................................... 6
Cash Management Portfolio............................................................ 7
Corporate Bond Portfolio............................................................. 7
Global Bond Portfolio................................................................ 8
High-Yield Bond Portfolio............................................................ 9
Worldwide High Income Portfolio...................................................... 10
Utility Portfolio.................................................................... 14
Balanced/Phoenix Investment Counsel Portfolio........................................ 16
SunAmerica Balanced Portfolio........................................................ 16
Asset Allocation Portfolio........................................................... 17
Growth-Income Portfolio.............................................................. 18
Alliance Growth, Growth/Phoenix Investment Counsel and Provident Growth Portfolios... 18
Federated Value Portfolio............................................................ 18
Venture Value Portfolio.............................................................. 19
Aggressive Growth Portfolio.......................................................... 20
Global Equities Portfolio............................................................ 20
International Diversified Equities Portfolio......................................... 21
DESCRIPTION OF SECURITIES AND INVESTMENT TECHNIQUES....................................... 22
MANAGEMENT................................................................................ 32
PORTFOLIO TURNOVER AND BROKERAGE.......................................................... 38
DIVIDENDS, DISTRIBUTIONS AND FEDERAL TAXES................................................ 38
PRICE OF SHARES........................................................................... 39
PURCHASES AND REDEMPTIONS................................................................. 39
SHAREHOLDER VOTING RIGHTS................................................................. 39
INDEPENDENT ACCOUNTANTS................................................................... 40
SHAREHOLDER INQUIRIES..................................................................... 40
FINANCIAL INFORMATION..................................................................... 40
</TABLE>

3
<PAGE> 6

FINANCIAL HIGHLIGHTS

The following Financial Highlights for the Portfolios and periods set forth
below have been audited by Price Waterhouse LLP, the Trust's independent
accountants, whose report on the financial statements containing such
information is included in the Trust's Annual Report to Shareholders. These
Financial Highlights* should be read in conjunction with the financial
statements and notes thereto, which are included in the Statement of Additional
Information.

- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
DIVIDENDS DIVIDENDS
NET TOTAL DECLARED FROM NET
NET ASSET NET REALIZED FROM FROM NET REALIZED NET ASSET
VALUE INVEST- & UNREALIZED INVEST- INVEST- GAIN ON VALUE
BEGINNING MENT GAIN (LOSS) ON MENT MENT INVEST- END OF TOTAL
PERIOD ENDED OF PERIOD INCOME** INVESTMENTS OPERATIONS INCOME MENTS PERIOD RETURN
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
Cash Management Portfolio
2/9/93-11/30/93 $ 10.00 $ 0.19 $ 0.01 $ 0.20 $ -- $ -- $ 10.20 2.00%
11/30/94 10.20 0.38 (0.02) 0.36 (0.09) -- 10.47 3.51
11/30/95 10.47 0.56 0.01 0.57 (0.34) -- 10.70 5.59

<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Corporate Bond Portfolio (formerly, Fixed Income Portfolio)
7/1/93-11/30/93 10.00 0.14 0.05 0.19 -- -- 10.19 1.90
11/30/94 10.19 0.52 (0.87) (0.35) (0.05) (0.04) 9.75 (3.41)
11/30/95 9.75 0.60 1.00 1.60 (0.53) -- 10.82 17.01
Global Bond Portfolio
7/1/93-11/30/93 10.00 0.13 0.17 0.30 -- -- 10.30 3.00
11/30/94 10.30 0.53 (0.86) (0.33) (0.09) (0.05) 9.83 (3.18)
11/30/95 9.83 0.60 0.97 1.57 (0.38) -- 11.02 16.40
High-Yield Bond Portfolio
2/9/93-11/30/93 10.00 0.76 0.36 1.12 -- -- 11.12 11.20
11/30/94 11.12 1.20 (1.65) (0.45) (0.29) (0.06) 10.32 (4.26)
11/30/95 10.32 1.11 0.12 1.23 (1.02) -- 10.53 12.64
Worldwide High Income Portfolio
10/28/94-11/30/94 10.00 0.04 (0.09) (0.05) -- -- 9.95 (0.50)
11/30/95 9.95 1.10 0.47 1.57 (0.10) -- 11.42 16.02
Balanced/Phoenix Investment Counsel Portfolio
10/28/94-11/30/94 10.00 0.04 (0.08) (0.04) -- -- 9.96 (0.40)
11/30/95 9.96 0.34 2.23 2.57 (0.05) -- 12.48 25.89
Asset Allocation Portfolio
7/1/93-11/30/93 10.00 0.08 0.28 0.36 -- -- 10.36 3.60
11/30/94 10.36 0.29 (0.25) 0.04 (0.05) (0.03) 10.32 0.30
11/30/95 10.32 0.42 2.24 2.66 (0.20) (0.04) 12.74 26.10

<CAPTION>
Corporate Bond Portfolio (formerly, Fixed Income Portfolio)
<S> <C> <C> <C> <C>
7/1/93-11/30/93 11,667 0.94+++ 3.92+++ 208
11/30/94 15,869 0.94++ 5.21++ 419
11/30/95 29,475 0.96++ 5.93++ 412
Global Bond Portfolio
7/1/93-11/30/93 25,010 1.35+++ 3.56+++ 84
11/30/94 44,543 1.06 5.29 347
11/30/95 59,759 0.95 5.89 339
High-Yield Bond Portfolio
2/9/93-11/30/93 41,851 0.94+++ 9.43+++ 229
11/30/94 55,803 0.92++ 11.07++ 225
11/30/95 82,174 0.80 10.80 174
Worldwide High Income Portfolio
10/28/94-11/30/94 10,478 1.60+++ 4.48+++ 2
11/30/95 21,515 1.30 10.46 176
Balanced/Phoenix Investment Counsel Portfolio
10/28/94-11/30/94 1,516 1.00+++ 4.25+++ 10
11/30/95 32,429 0.98++ 3.08++ 153
Asset Allocation Portfolio
7/1/93-11/30/93 35,590 0.99+++ 2.33+++ 71
11/30/94 106,856 0.94++ 2.71++ 152
11/30/95 199,836 0.81 3.62 207
</TABLE>

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<TABLE>
<C> <S>
* Calculated based upon average shares outstanding
** After fee waivers and expense reimbursements by the investment adviser
+ Annualized
++ During the periods ended November 30, 1993, November 30, 1994 and November 30, 1995, the investment adviser
waived a portion of or all fees and assumed a portion of or all expenses for the Portfolios. If all fees and
expenses had been incurred by the Portfolios, the ratio of expenses to average net assets and the ratio of
net investment income (loss) to average net assets would have been as follows:
</TABLE>

<TABLE>
<CAPTION>
EXPENSES NET INVESTMENT INCOME (LOSS)
-------------------------------- --------------------------------
11/30/93 11/30/94 11/30/95 11/30/93 11/30/94 11/30/95
<S> <C> <C> <C> <C> <C> <C>
--------------------------------
--------------------------------
Cash Management Portfolio........................ 1.10% 0.78% 0.67% 2.14% 3.65% 5.32%
Corporate Bond Portfolio......................... 1.81 1.09 0.97 3.05 5.06 5.92
Global Bond Portfolio............................ 1.81 1.06 0.95 3.10 5.29 5.89
High-Yield Bond Portfolio........................ 1.29 0.93 0.80 9.08 11.06 10.80
Worldwide High Income Portfolio.................. -- 2.26 1.30 -- 3.82 10.46
Balanced/Phoenix Investment Counsel Portfolio.... -- 6.82 1.11 -- (1.57) 2.95
Asset Allocation Portfolio....................... 1.67 0.94 0.81 1.65 2.71 3.62
</TABLE>

4
<PAGE> 7

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<TABLE>
<CAPTION>
DIVIDENDS DIVIDENDS
NET NET TOTAL DECLARED FROM NET
NET ASSET INVEST- REALIZED FROM FROM NET REALIZED NET ASSET
VALUE MENT & UNREALIZED INVEST- INVEST- GAIN ON VALUE
BEGINNING INCOME GAIN (LOSS) ON MENT MENT INVEST- END OF TOTAL
PERIOD ENDED OF PERIOD (LOSS)** INVESTMENTS OPERATIONS INCOME MENTS PERIOD RETURN
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
Growth-Income Portfolio
2/9/93-11/30/93 $ 10.00 $ 0.12 $ 0.49 $ 0.61 $ -- $ -- $ 10.61 6.10%
11/30/94 10.61 0.13 (0.36) (0.23) (0.04) (0.01) 10.33 (2.20)
11/30/95 10.33 0.17 3.31 3.48 (0.10) -- 13.71 33.89

NET RATIO OF NET
ASSETS RATIO OF INVESTMENT
END OF EXPENSES INCOME
PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
PERIOD ENDED (000'S) NET ASSETS NET ASSETS TURNOVER
<S> <C> <C> <C> <C>
- ------------------
Growth-Income Port
2/9/93-11/30/93 $ 45,080 0.82%+++ 1.59%+++ 27%
11/30/94 84,899 0.81++ 1.26++ 59
11/30/95 171,281 0.77 1.42 59
Alliance Growth Portfolio
2/9/93-11/30/93 10.00 0.05 0.87 0.92 -- -- 10.92 9.20
11/30/94 10.92 0.04 (0.14) (0.10) (0.01) (0.17) 10.64 (0.93)
11/30/95 10.64 0.07 5.08 5.15 (0.03) (0.13) 15.63 48.91
Growth/Phoenix Investment Counsel Portfolio
2/9/93-11/30/93 10.00 0.17 0.61 0.78 -- -- 10.78 7.80
11/30/94 10.78 0.16 (0.87) (0.71) (0.06) -- 10.01 (6.64)
11/30/95 10.01 0.12 3.14 3.26 (0.13) -- 13.14 32.92
Provident Growth Portfolio
2/9/93-11/30/93 10.00 0.02 0.02 0.04 -- -- 10.04 0.40
11/30/94 10.04 0.03 (0.01) 0.02 (0.01) -- 10.05 0.19
11/30/95 10.05 (0.01) 3.09 3.08 (0.03) -- 13.10 30.66
Venture Value Portfolio
10/28/94-11/30/94 10.00 0.03 (0.25) (0.22) -- -- 9.78 (2.20)
11/30/95 9.78 0.17 3.55 3.72 (0.03) -- 13.47 38.17
Global Equities Portfolio
2/9/93-11/30/93 10.00 0.03 0.96 0.99 -- -- 10.99 9.90
11/30/94 10.99 0.05 0.71 0.76 (0.01) (0.07) 11.67 6.87
11/30/95 11.67 0.12 1.64 1.76 (0.08) (0.29) 13.06 15.58
International Diversified Equities Portfolio
10/28/94-11/30/94 10.00 0.01 (0.23) (0.22) -- -- 9.78 (2.20)
11/30/95 9.78 0.07 0.38 0.45 (0.08) -- 10.15 4.63

<CAPTION>
Alliance Growth Po
<S> <C> <C> <C> <C>
2/9/93-11/30/93 23,256 0.82+++ 0.61+++ 73
11/30/94 53,213 0.82++ 0.37++ 146
11/30/95 167,870 0.79 0.51 138
Growth/Phoenix Inv
2/9/93-11/30/93 65,032 0.82+++ 2.20+++ 165
11/30/94 104,194 0.81++ 1.52++ 211
11/30/95 149,910 0.76 1.01 229
Provident Growth P
2/9/93-11/30/93 42,911 0.97+++ 0.32+++ 40
11/30/94 75,342 0.96++ 0.31++ 54
11/30/95 115,276 0.93 (0.05) 52
Venture Value Port
10/28/94-11/30/94 4,449 1.10+++ 3.93+++ --
11/30/95 154,908 1.00++ 1.43++ 18
Global Equities Po
2/9/93-11/30/93 43,737 1.50+++ 0.38+++ 58
11/30/94 136,758 1.28 0.42 67
11/30/95 165,752 1.14 1.02 106
International Dive
10/28/94-11/30/94 12,438 1.70+++ 1.60+++ --
11/30/95 48,961 1.70++ 0.76++ 52
</TABLE>

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<TABLE>
<CAPTION>
EXPENSES NET INVESTMENT INCOME (LOSS)
-------------------------------- --------------------------------
11/30/93 11/30/94 11/30/95 11/30/93 11/30/94 11/30/95
<S> <C> <C> <C> <C> <C> <C>
--------------------------------
--------------------------------
Growth-Income Portfolio.......................... 1.40% 0.89% 0.77% 1.01% 1.18% 1.42%
Alliance Growth Portfolio........................ 1.56 0.96 0.79 (0.13) 0.23 0.51
Growth/Phoenix Investment Counsel Portfolio...... 1.28 0.87 0.76 1.74 1.46 1.01
Provident Growth Portfolio....................... 1.46 1.05 0.93 (0.17) 0.22 (0.05)
Venture Value Portfolio.......................... -- 3.89 1.02 -- 1.14 1.41
Global Equities Portfolio........................ 2.52 1.28 1.14 (0.64) 0.42 1.02
International Diversified Equities Portfolio..... -- 3.50 2.09 -- (0.20) 0.37
</TABLE>

5
<PAGE> 8

THE TRUST, ITS INVESTMENT OBJECTIVES AND POLICIES

The Trust, organized as a Massachusetts business trust on September 11,
1992, is an open-end management investment company. It was established to
provide a funding medium for certain annuity contracts issued by the Variable
Separate Account and FS Variable Separate Account (the "Accounts"), which are
separate accounts of Anchor National Life Insurance Company and First SunAmerica
Life Insurance Company, respectively (collectively referred to as the "Life
Companies").

The Trust issues 18 separate series of shares ("Portfolios"), each of which
represents a separate managed portfolio of securities with its own investment
objectives. The Board of Trustees may establish additional series in the future.
The current Portfolios are the Cash Management Portfolio, Corporate Bond
Portfolio (formerly, the Fixed Income Portfolio), Global Bond Portfolio,
High-Yield Bond Portfolio, Worldwide High Income Portfolio, Utility Portfolio,
Balanced/Phoenix Investment Counsel Portfolio, SunAmerica Balanced Portfolio,
Asset Allocation Portfolio, Growth-Income Portfolio, Alliance Growth Portfolio,
Growth/Phoenix Investment Counsel Portfolio, Provident Growth Portfolio,
Federated Value Portfolio, Venture Value Portfolio, Aggressive Growth Portfolio,
Global Equities Portfolio and International Diversified Equities Portfolio. All
shares may be purchased or redeemed by the Accounts at net asset value without
any sales or redemption charge.

SunAmerica Asset Management Corp. ("SAAMCo" or the "Adviser"), an indirect,
wholly owned subsidiary of Anchor National Life Insurance Company, serves as
investment adviser for all the Portfolios of the Trust. (See "Management.")
Alliance Capital Management L.P. ("Alliance") serves as subadviser for the
Global Equities, Alliance Growth and Growth-Income Portfolios; Davis Selected
Advisers, L.P. serves as subadviser for the Venture Value Portfolio; Federated
Investment Counseling ("Federated") serves as subadviser for the Corporate Bond,
Federated Value and Utility Portfolios. Goldman Sachs Asset Management ("GSAM"),
a separate operating division of Goldman, Sachs & Co., serves as subadviser for
the Asset Allocation Portfolio; Goldman Sachs Asset Management International
("GSAM-International"), an affiliate of Goldman, Sachs & Co., serves as
subadviser for the Global Bond Portfolio; Morgan Stanley Asset Management Inc.
("MSAM") serves as subadviser for the International Diversified Equities and
Worldwide High Income Portfolios; Phoenix Investment Counsel, Inc. ("Phoenix")
serves as subadviser for the Growth/Phoenix Investment Counsel and
Balanced/Phoenix Investment Counsel Portfolios; Provident Investment Counsel,
Inc. ("Provident") serves as subadviser for the Provident Growth Portfolio.
There is no subadviser for the Cash Management, High-Yield Bond, SunAmerica
Balanced, or Aggressive Growth Portfolios. SAAMCo performs all investment
advisory services for these Portfolios.

Each Portfolio has investment objectives and certain policies set forth
herein. There can be no guarantee that any Portfolio's investment objectives
will be met or that the net return on an investment in a Portfolio will exceed
that which could have been obtained through other investment or savings
vehicles. Investors should carefully review the investment objectives and
policies of a Portfolio and consider their ability to assume the risks involved
before making an investment in a Portfolio. Each Portfolio also has certain
fundamental investment restrictions, which are described in the Statement of
Additional Information. A Portfolio's fundamental investment restrictions may
not be changed without a majority of the outstanding voting securities of that
Portfolio. See "Shareholder Voting Rights." Except for its fundamental
investment restrictions, each Portfolio's investment objective and policies are
not fundamental and may be changed without a vote of the shareholders. If there
is a change in a Portfolio's investment objective, shareholders should consider
whether the Portfolio remains an appropriate investment in light of their
then-current financial positions and needs.

The Global Bond, Worldwide High Income and International Diversified
Equities Portfolios are organized as separate "non-diversified" portfolios of
the Trust (as such term is defined under the Investment Company Act of 1940, as
amended, (the "1940 Act")); subject, however, to certain tax diversification
requirements and to diversification guidelines of the California Department of
Insurance. See Dividends, Distributions and Federal Taxes. Also, the Utility
Portfolio intends to concentrate its investments in the utility industry, which
means that the Portfolio intends to invest at least 25% of its total assets in
the securities of utility companies.

The Portfolios' investment objectives and a summary of the policies they
currently follow in attempting to achieve those objectives are set forth below.
Please also refer, however, to the section following, captioned "Description of
Securities and Investment Techniques," for a more detailed description of the
characteristics and risks associated with the types of securities in which the
various Portfolios invest. Reference is also made in the following sections to
ratings assigned to certain types of securities by Standard & Poor's Rating
Services, a Division of the McGraw Hill Companies, Inc. ("S&P"), Moody's
Investors Service, Inc. ("Moody's"), Fitch Investors Service, Inc. ("Fitch"),
Duff & Phelps Credit Rating Co. ("Duff & Phelps") and Thomson BankWatch, Inc.,

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<PAGE> 9

recognized independent securities ratings institutions. References herein to the
particular ratings categories of the securities in which a Portfolio may invest
should be read to include unrated securities deemed by the Adviser or Subadviser
to be of comparable quality to the rated securities in such categories. A
description of the ratings categories assigned by S&P, Moody's, Fitch and Duff &
Phelps is contained in the Statement of Additional Information.

CASH MANAGEMENT PORTFOLIO

The Cash Management Portfolio seeks high current yield while preserving
capital by investing in a diversified selection of money market instruments
including corporate bonds and notes; commercial bank obligations; securities of
the U.S. government, its agencies and instrumentalities; commercial paper and
savings association obligations. These securities mature in one year or less.
The Cash Management Portfolio also may enter into repurchase agreements and firm
commitment agreements and purchase when-issued securities. See "Description of
Securities and Investment Techniques."

The Cash Management Portfolio invests only in securities determined, in
accordance with procedures established by the Trust's board of trustees, to
present minimal credit risks. It is the current policy to invest only in
instruments rated in the highest rating category by Moody's and S&P (for
example, commercial paper rated P-1 and A-1 by Moody's and S&P, respectively) or
in instruments that are issued, guaranteed or insured by the U.S. government,
its agencies or instrumentalities as to the payment of principal and interest,
or in other instruments rated in the highest two categories by either Moody's or
S&P, provided the issuer has commercial paper rated in the highest rating
category by Moody's and S&P.

Although there is no guarantee that the Portfolio's investment objective
will be achieved, investments in the Cash Management Portfolio should present
minimal market risk because the investments of the Portfolio consists of only
short-term debt obligations. However, an investment in this Portfolio is subject
to the risks of declining interest rates and the economy as a whole. Also, the
return on an investment in the Cash Management Portfolio would not be the same
as the return on an investment in a money market fund available directly to the
public even where yields are equivalent, due to fees imposed at the variable
annuity contract level. A more detailed description of the instruments in which
this Portfolio may invest is contained in the Statement of Additional
Information.

CORPORATE BOND PORTFOLIO

The Corporate Bond Portfolio seeks a high total return with only moderate
price risk by investing primarily in investment grade fixed-income securities.
Under normal market conditions, the Portfolio will invest at least 65% of the
value of its total assets, taken at market value at the time of investment, in
corporate debt securities, including asset-backed securities and privately
placed debt securities, of domestic and foreign issuers. In addition, under
normal circumstances, at least 65% of the Portfolio's total assets will be
invested in investment grade debt securities (i.e., those rated at the time of
purchase within the four highest grades assigned by Moody's (Aaa, Aa, A or Baa)
or by S&P (AAA, AA, A or BBB), securities issued or guaranteed by the U.S.
government or its agencies or instrumentalities (including mortgaged-backed
securities) or repurchase agreements collateralized by such investment grade or
U.S. government securities. Debt securities are sometimes offered with warrants
for the purchase of common stock of the issuer of the debt security. These may
be purchased by the Portfolio only when the debt security meets the Portfolio's
investment criteria and the value of the warrants is relatively small. If the
warrant becomes valuable it will ordinarily be sold rather than exercised. It is
anticipated that no more than 10% of the assets of the Portfolio will constitute
warrants. To the extent that warrants are acquired, there may be some additional
investment risk and countervailing opportunity, depending upon the extent to
which the underlying common stock price fluctuates.

Up to 35% of the Portfolio's total assets may be invested in: other types
of debt securities, including those rated below investment grade, zero-coupon
bonds, pay-in-kind securities, and units consisting of bonds and equity
equivalents; commercial paper rated at the time of purchase P-1 by Moody's or
A-1 by S&P; obligations of banks having total assets in excess of $1 billion;
preferred stocks (including those rated below investment grade, convertible
into, or carrying warrants to purchase, common stocks or other equity
interests); and marketable common stocks which the Subadviser considers likely
to yield relatively high income in relation to alternative investments.

The Portfolio may invest in debt securities and preferred stocks rated
below investment grade to the extent that the Subadviser believes that lower
credit quality of such securities is offset by more attractive yields. There is
no limit with respect to the rating categories for securities in which the
Portfolio may invest, although investment in debt

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<PAGE> 10

securities in the two lowest rating categories will be limited to 10% of total
assets. See "Description of Securities and Investment Techniques -- Corporate
Debt Instruments -- Lower Grade" for a description of lower-rated securities.

The Portfolio may invest in high quality short-term money market
instruments denominated in U.S. dollars, including repurchase agreements, which
are also authorized for purchase by the Cash Management Portfolio. The Portfolio
may enter into "dollar rolls" in which the Portfolio sells mortgage or other
asset-backed securities for delivery in the current month and simultaneously
contracts to repurchase substantially similar (same types, coupons and maturity)
securities on a specified future date. The Portfolio may also invest in
synthetic or derivative instruments based on permitted investments, including
futures contracts, options, interest-rate swaps, mortgage swaps and
interest-rate caps, floors and collars.

GLOBAL BOND PORTFOLIO

The investment objective of the Global Bond Portfolio is to provide
investors with a high total return, emphasizing current income and, to a lesser
extent, providing opportunities for capital appreciation, through investment in
a portfolio of high quality fixed-income securities of U.S. and foreign issuers
and through transactions in foreign currencies. High quality securities are
defined as securities which have ratings of at least AA by S&P or Aa by Moody's
("High Quality Ratings").

Under normal circumstances, the Portfolio will seek to meet its investment
objective by pursuing investment opportunities in foreign and domestic
fixed-income securities markets and by engaging in currency transactions to
enhance returns and for the purpose of hedging its investments.

In selecting securities for the Portfolio, GSAM-International will consider
such factors as the security's duration, sector and credit quality rating as
well as the security's yield and prospects for capital appreciation. It is
expected that the Portfolio will use currency transactions both to enhance
returns for a given level of risk and to hedge its exposure to foreign
currencies. While the Portfolio will have both long and short currency
positions, neither its net long foreign currency exposure nor its net short
foreign currency exposure will exceed the value of the Portfolio's total assets.

Under normal circumstances, the Portfolio will maintain a dollar-weighted
average duration of not more than 7.5 years. However, the Portfolio is not
subject to any limitation with respect to the average maturity of its Portfolio
or the individual securities in which the Portfolio may invest. Duration
represents the weighted average maturity of expected cash flows on a debt
obligation, discounted to present value. Maturity measures only the time until
final payment is due on a bond or other debt security; it takes no account of
the pattern of a security's cash flows over time. In computing the duration of
its portfolio, the Subadviser will have to estimate the duration of debt
obligations that are subject to prepayment or redemption by the issuer.

The Portfolio may use various techniques to shorten or lengthen its
dollar-weighted average duration, including the acquisition of debt obligations
at a premium or discount, transactions in options, futures contracts, options on
futures and interest-rate swaps, caps and floors. The Portfolio may also invest
in mortgage-related securities and enter into dollar-rolls.

It is expected that the Portfolio will employ certain active currency and
interest-rate management techniques involving risks different from those
associated with investing solely in dollar-denominated fixed-income securities
of U.S. issuers. Such active management techniques include transactions in
options (including yield curve options), futures and options on futures, forward
foreign currency exchange contracts, currency options and futures, currency and
interest-rate swaps and floors, caps and collars. The aggregate amount of the
Portfolio's net currency exposure will not exceed its total asset value.
However, to the extent that the Portfolio is fully invested in fixed-income
securities while also maintaining currency positions, it may be exposed to
greater combined risk. The Portfolio's net currency positions may expose it to
risks independent of its securities positions.

The fixed-income securities in which the Portfolio may invest include: (i)
securities issued or guaranteed by the U.S. government, its agencies or
instrumentalities and custodial receipts thereof; (ii) securities issued or
guaranteed by a foreign government or any of its political subdivisions,
authorities, agencies or instrumentalities or by multiple governmental entities
(i.e., international organizations designated or supported by governmental
entities to promote economic reconstruction or development, such as the World
Bank) rated A or better by S&P or Moody's, provided that the obligations are
denominated in the issuer's own currency; (iii) corporate debt securities having
at least one high quality rating or, if unrated, determined by the Subadviser to
be of comparable credit quality; (iv) certificates of deposit and bankers'
acceptances issued or guaranteed by, or time deposits maintained at, banks
(including U.S.

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<PAGE> 11

or foreign branches of U.S. banks or U.S. or foreign branches of foreign banks)
having total assets of more than $1 billion and determined by the Subadviser to
be of comparable credit quality to securities with a high quality rating; (v)
commercial paper rated A-1 or better by S&P, P-1 or better by Moody's, Fitch-1
or better by Fitch, or Duff 1 or better by Duff & Phelps or, if not rated,
issued by U.S. or foreign companies having outstanding debt securities with a
high quality rating and determined by the Subadviser to be of comparable credit
quality to securities with a high quality rating; and (vi) mortgage-related and
asset-backed securities having at least one high quality rating.

Although the Portfolio may invest in securities satisfying the minimum
credit quality criteria prescribed above, the Portfolio generally intends to
invest at least 50% of its net assets in securities having the highest
applicable credit quality rating. Currently, most of the foreign securities that
meet the Portfolio's credit quality standards are likely to be securities issued
by foreign governments. The debt securities in which the Portfolio will invest
may have fixed, variable or floating interest rates.

The Portfolio will, under normal market conditions, have at least 30% of
its total assets, adjusted to reflect the Portfolio's net exposure after giving
effect to currency transactions and positions, denominated in U.S. dollars. The
Portfolio may, for temporary defensive purposes (such as when instability or
unfavorable conditions exist in foreign countries), invest 100% of its total
assets in dollar-denominated securities or securities of U.S. issuers.

Because the securities markets in each of Canada, Germany, Japan and the
United Kingdom are highly developed, liquid and subject to extensive regulation,
the Global Bond Portfolio may invest up to 35% of its total assets in the
securities of corporate and government issuers located in any one of such
countries. Concentration of the Portfolio's investments in such issuers will
subject the Portfolio to the risks of adverse social, political or economic
events which may occur in those countries.

Investment in foreign securities involves special risks. See "Description
of Securities and Investment Techniques -- Risks and Considerations Applicable
to Investment in Securities of Foreign Issuers."

HIGH-YIELD BOND PORTFOLIO

The primary investment objective of the High-Yield Bond Portfolio is a high
level of current income; its secondary investment objective is capital
appreciation.

Under normal market conditions the Portfolio will be invested substantially
in long-term (over 10 years to maturity) and intermediate-term (3 to 10 years to
maturity) fixed-income securities, with emphasis on higher-yielding,
higher-risk, lower-rated or unrated corporate bonds. These "high-yield" bonds,
commonly referred to as "junk bonds," typically are subject to greater market
fluctuations and risk of loss of income and principal due to default by the
issuer than are investments in lower-yielding, higher-rated bonds.

High-yield, high-risk bonds generally include any bonds that are rated Ba
or below by Moody's or BB or below by S&P. Bonds rated Ba or BB or below are
considered speculative. The Portfolio may invest without limitation in bonds
rated as low as Ca by Moody's or C by S&P (or unrated but considered by the
Adviser of equivalent quality). In addition, the Portfolio may invest up to 10%
of its total assets in bonds rated C by Moody's or D by S&P. High-yield bonds
are riskier than lower-yielding, higher-rated bonds. See "Description of
Securities and Investment Techniques -- Corporate Debt Instruments -- Lower
Grade" and "Description of Securities and Investment Techniques -- Risk Factors
Relating to High-Yield Bonds" for a more detailed description of these
securities.

In pursuing its secondary investment objective of capital appreciation, the
Portfolio may purchase high-yield bonds that are expected by the Adviser to
increase in value due to improvements in their credit quality or ratings or
anticipated declines in interest rates. In addition, the Portfolio may invest
for this purpose up to 25% of its assets in equity securities, such as common
stocks, or other securities having common stock characteristics. Securities
designated as having "common stock" characteristics include, but are not limited
to, securities convertible into or exchangeable for common stock. Such
securities normally will be purchased as part of a unit with fixed-income
securities or when an unusual opportunity for capital appreciation is perceived
due to anticipated improvement in the issuer's credit quality or ratings. The
Portfolio also may purchase or hold warrants or rights.

Treating high current income as its primary investment objective means that
the Portfolio may forego opportunities that would result in capital gains and
may accept prudent risks to capital value, in each case to take advantage of
opportunities for higher current income.

Up to 25% of the Portfolio's assets may be invested in securities of
foreign issuers, which are generally denominated in currencies other than the
U.S. dollar. The Portfolio also has the ability to hold a portion of its assets

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<PAGE> 12

in foreign currencies and to enter into forward foreign currency exchange
contracts, currency options, currency and financial futures contracts, and
options on such futures contracts. The Portfolio may enter into repurchase
agreements and firm commitment agreements and may purchase securities on a
when-issued basis. Investment in foreign securities also involves special risks.
See "Description of Securities and Investment Techniques -- Risks and
Considerations Applicable to Investment in Securities of Foreign Issuers."

Under normal market conditions, the Portfolio will invest at least 65% of
its total assets in high-yield bonds as described above. Subject to this
requirement the Portfolio may maintain assets in cash or cash equivalents,
including commercial bank obligations (certificates of deposit; bankers'
acceptances, which are time drafts on a commercial bank for which the bank
accepts an irrevocable obligation to pay at maturity; and demand or time
deposits), commercial paper (short-term notes issued by corporations or
governmental bodies) and obligations issued or guaranteed by the U.S.
government.

WORLDWIDE HIGH INCOME PORTFOLIO

The investment objective of the Worldwide High Income Portfolio is high
current income and, secondarily, capital appreciation, by investing primarily in
a portfolio of high-yielding fixed-income securities of issuers located
throughout the world. The Portfolio seeks to achieve its investment objective by
allocating its assets among any or all of three investment sectors: U.S.
corporate lower-rated and unrated debt securities, emerging country debt
securities and global fixed-income securities offering high real yields. The
types of securities in each of these investment sectors in which the Portfolio
may invest are described below. In selecting U.S. corporate lower-rated and
unrated debt securities for the Portfolio, the Subadviser will consider, among
other things, the price of the security, and the financial history, condition,
prospects and management of an issuer. The Subadviser intends to invest a
portion of the Portfolio's assets in emerging country debt securities that
provide a high level of current income, while at the same time holding the
potential for capital appreciation if the perceived creditworthiness of the
issuers improves due to improving economic, financial, political, social or
other conditions in the country in which the issuer is located. In addition, the
Subadviser will attempt to invest a portion of the Portfolio's assets in
fixed-income securities of issuers in global fixed-income markets displaying
high real (inflation adjusted) yields. Under normal conditions, the Portfolio
intends to invest between 80% and 100% of its total assets in some or all of
three categories of higher-yielding securities, some of which may entail
increased credit and market risk. See "Risk Factors Relating to High-Yield
Bonds" and "Risks and Considerations Applicable to Investment in Securities of
Foreign Issuers" under "Description of Securities and Investment Techniques."

The Subadviser's approach to multi-currency fixed-income management is
strategic and value-based and designed to produce an attractive real rate of
return. The Subadviser's assessment of the bond markets and currencies is based
on an analysis of real interest rates. Current nominal yields of securities are
adjusted for inflation prevailing in each currency sector using an analysis of
past and projected inflation rates. The Portfolio's aim is to invest in bond
markets which offer the most attractive real returns relative to inflation.

From time to time, a portion of the Portfolio's investments, which may be
up to 100% of its investments, may be considered to have credit quality below
investment grade as determined by internationally recognized credit rating
agency organizations, such as Moody's and S&P. Such lower-rated bonds are
commonly referred to as "junk bonds." Securities in such lower rating categories
may have predominantly speculative characteristics or may be in default. See
"Description of Securities and Investment Techniques -- Corporate Debt
Instruments -- Lower Grade" for a description of Moody's and S&P's corporate
bond ratings. Ratings represent the opinion of rating agencies as to the quality
of bonds and other debt securities they undertake to rate at the time of
issuance. However, ratings are not absolute standards of quality and may not
reflect changes in an issuer's creditworthiness. Accordingly, while the
Subadviser will consider ratings, it will perform its own analysis and will not
rely principally on ratings. Emerging country debt securities in which the
Portfolio may invest will be subject to high risk and will not be required to
meet a minimum rating standard and may not be rated for creditworthiness by any
internationally recognized credit rating organization. The Portfolio's
investments in U.S. corporate lower-rated and unrated debt securities and
emerging country debt securities are expected to be rated in the lower and
lowest rating categories of internationally recognized credit rating
organizations. Ratings of a foreign debt instrument, to the extent that those
ratings are undertaken, are related to evaluations of the country in which the
issuer of the instrument is located. Ratings generally take into account the
currency in which a foreign debt instrument is denominated; instruments issued
by a foreign government in other than the local currency, for example, typically
have a lower rating than local currency instruments due to the existence of an
additional risk that the government will be unable to obtain the required
foreign currency to service its foreign currency-denominated debt. In general,
the ratings of debt securities or

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obligations issued by a foreign public or private entity will not be higher than
the rating of the currency or the foreign currency debt of the central
government of the country in which the issuer is located, regardless of the
intrinsic creditworthiness of the issuer. To mitigate the risks associated with
investment in such lower-rated securities, the Portfolio will diversify its
holdings by market, issuer, industry and credit quality.

The Portfolio may invest in or own securities of companies in various
stages of financial restructuring, bankruptcy or reorganization which are not
currently paying interest or dividends, provided that the total value at the
time of purchase, of all such securities will not exceed 10% of the value of the
Portfolio's total assets. The Portfolio may have limited recourse in the event
of default on such debt instruments. The Portfolio may invest in loans,
assignments of loans and participation in loans. See "Description of Securities
and Investment Techniques -- Loan Participations and Assignments." The Portfolio
may also invest in depository receipts issued by U.S. or foreign financial
institutions. See "Description of Securities and Investment
Techniques -- Depository Receipts."

The Portfolio is not restricted in the portion of its assets which may be
invested in securities denominated in a particular currency and a substantial
portion of its assets may be invested in non-U.S. dollar-denominated securities.
The portion of the Portfolio's assets invested in securities denominated in
currencies other than the U.S. dollar will vary depending on market conditions.
The analysis of currencies is made independent of the analysis of markets. Value
in foreign exchange is determined by relative purchasing power parity of a given
currency. The Portfolio seeks to invest in currencies currently undervalued
based on purchasing power parity. The Subadviser analyzes current account and
capital account performance and real interest rates to adjust for short-term
currency flows. Although the Portfolio is permitted to engage in a wide variety
of investment practices designed to hedge against currency exchange rate risks
with respect to its holdings of non-U.S. dollar-denominated debt securities, the
Portfolio may be limited in its ability to hedge against these risks. See
"Foreign Currency Transactions" and "Short Sales" under "Description of
Securities and Investment Techniques." The Portfolio may also write (i.e., sell)
covered call options and may enter into futures contracts and options on futures
and sell indexed financial futures contracts. See "Futures Contracts and Options
Thereon" and "Options on Securities and Securities Indices" under "Description
of Securities and Investment Techniques."

The Portfolio may invest in zero-coupon, pay-in-kind or deferred payment
securities and in securities that may be collateralized by zero-coupon
securities (such as Brady Bonds which are described below). Zero-coupon
securities are sold at a discount to par value and are not entitled to interest
payments during the life of the security. Upon maturity, the holder is entitled
to receive the par value of the security. While interest payments are not made
on such securities, holders of such securities are deemed to receive "phantom
income," which the Portfolio will accrue prior to the receipt of any cash
payments. Pay-in-kind securities are securities that have interest payable by
delivery of additional securities. Upon maturity, the holder is entitled to
receive the aggregate par value of the securities. Deferred payment securities
are securities that remain zero-coupon securities until a predetermined date, at
which time the stated coupon rate becomes effective and interest becomes payable
at regular intervals. Zero-coupon, pay-in-kind and deferred payment securities
may be subject to greater fluctuation in value and lesser liquidity in the event
of adverse market conditions than comparably rated securities paying cash
interest at regular interest payment periods.

The Portfolio is authorized to borrow up to 33 1/3% of its total assets
(including the amount borrowed), less all liabilities and indebtedness other
than the borrowing, for investment purposes to increase the opportunity for
greater return and for payment of dividends. Such borrowings would constitute
leverage, which is a speculative characteristic. Leveraging will magnify
declines as well as increases in the net asset value of the Portfolio's shares
and in the yield on the Portfolio's investments. See "Description of Securities
and Investment Techniques -- Borrowing and Other Forms of Leverage."

The average time to maturity of the Portfolio's securities will vary
depending upon the Subadviser's perception of market conditions. The Subadviser
invests in medium-term securities (i.e., those with a remaining maturity of
approximately five years) in a market neutral environment. When the Subadviser
believes that real yields are high, the Subadviser lengthens the remaining
maturities of securities held by the Portfolio and, conversely, when the
Subadviser believes real yields are low, it shortens the remaining maturities.
Thus, the Portfolio is not subject to any restrictions on the maturities of the
debt securities it holds, and the Subadviser may vary the average maturity of
the securities held in the Portfolio without limit.

The Portfolio may, to a limited extent, invest in non-publicly traded
securities, private placements and restricted securities. See "Description of
Securities and Investment Techniques -- Non-Publicly Traded Securities, Private
Placements and Restricted Securities."

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For temporary defensive purposes, the Portfolio may invest part or all of
its total assets in cash or in short-term securities, including certificates of
deposit, commercial paper, notes, obligations issued or guaranteed by the U.S.
government or any of its agencies or instrumentalities, and repurchase
agreements involving such government securities.

U.S. Corporate High-Yield Fixed-Income Securities -- A portion of the
Worldwide High Income Portfolio's assets will be invested in U.S. corporate
high-yield fixed-income securities, which offer a yield above that generally
available on U.S. corporate debt securities in the four highest rating
categories of the recognized rating services. The Portfolio may acquire
fixed-income securities of U.S. issuers, including debt obligations (e.g.,
bonds, debentures, notes, equipment lease certificates, equipment trust
certificates, conditional sales contracts, commercial paper and obligations
issued or guaranteed by the U.S. government or any of its political
subdivisions, agencies or instrumentalities) and preferred stock. These
fixed-income securities may have equity features, such as conversion rights or
warrants, and the Portfolio may invest up to 10% of its total assets in equity
securities other than preferred stock (e.g., common stock, warrants and rights
and limited partnership interests). The Portfolio may not invest more than 5% of
its total assets at the time of acquisition in either of (1) equipment lease
certificates, equipment trust certificates, equipment trust certificates and
conditional sales contracts or (2) limited partnership interests.

Emerging Country Fixed-Income Securities -- A portion of the Worldwide High
Income Portfolio's assets will be invested in emerging country fixed-income
securities, which are debt securities of government and government-related
issuers located in emerging countries (including participations in loans between
governments and financial institutions), and of entities organized to
restructure outstanding debt of such issuers and debt securities of corporate
issuers located in or organized under the laws of emerging countries. As used
with respect to this Portfolio, an emerging country is any country that the
International Bank for Reconstruction and Development (more commonly known as
the World Bank) has determined to have a low or middle income economy. There are
currently over 130 countries which are considered to be emerging countries,
approximately 40 of which currently have established securities markets. The
countries generally include every nation in the world except the United States,
Canada, Japan, Australia, New Zealand and most nations located in Western
Europe.

In selecting emerging country debt securities for investment by the
Portfolio, the Subadviser will apply a market risk analysis contemplating
assessment of factors such as liquidity, volatility, tax implications, interest
rate sensitivity, counterparty risks and technical market considerations.
Currently, investing in many emerging country securities is not feasible or may
involve unacceptable political risks. The Portfolio expects that its investments
in emerging country debt securities will be made primarily in some or all of the
following emerging countries:

Argentina
Brazil
Chile
Czech Republic
Egypt
Greece
Hungary
Indonesia
Malaysia
Mexico
Morocco
Pakistan
Peru
Philippines
Poland
Portugal
South Africa
Thailand
Turkey
Uruguay
Venezuela

As opportunities to invest in debt securities in other emerging countries
develop, the Portfolio expects to expand and further diversify the emerging
countries in which it invests. While the Portfolio generally is not restricted
in the portion of its assets which may be invested in a single country or
region, it is anticipated that, under normal circumstances, the Portfolio's
assets will be invested in at least three countries.

The Portfolio's investments in government and government-related and
restructured debt securities will consist of (i) debt securities or obligations
issued or guaranteed by governments, governmental agencies or instrumentalities
and political subdivisions located in emerging countries (including
participation in loans between governments and financial institutions), (ii)
debt securities or obligations issued by government owned, controlled or
sponsored entities located in emerging countries, and (iii) interests in issuers
organized and operated for the purpose of restructuring the investment
characteristics of instruments issued by any of the entities described above.
Such type of restructuring involves the deposit with or purchase by an entity of
specific instruments and the issuance by that entity of one or more classes of
securities backed by, or representing an interest in, the underlying
instruments. Certain issuers of such structured securities may be deemed to be
"investment companies" as defined in the 1940 Act. As a result, the Portfolio's
investment in such securities may be limited by certain investment restrictions
contained in the 1940 Act.

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The Portfolio's investments in debt securities of corporate issuers in
emerging countries may include debt securities or obligations issued (i) by
banks located in emerging countries or by branches of emerging country banks
located outside the country or (ii) by companies organized under the laws of an
emerging country. Determinations as to eligibility will be made by the
Subadviser based on publicly available information and inquiries made to the
issuer. The Portfolio may also invest in certain debt obligations customarily
referred to as "Brady Bonds," which are created through the exchange of existing
commercial bank loans to foreign entities for new obligations in connection with
debt restructuring under a plan introduced by former U.S. Secretary of the
Treasury Nicholas F. Brady.

Emerging country debt securities held by the Portfolio will take the form
of bonds, notes, bills, debentures, convertible securities, warrants, bank debt
obligations, short-term paper, mortgage-backed and other asset-backed
securities, loan participations, loan assignments and interests issued by
entities organized and operated for the purpose of restructuring the investment
characteristics of instruments issued by emerging country issuers. U.S.
dollar-denominated emerging country debt securities held by the Portfolio will
generally be listed but not traded on a securities exchange, and non-U.S.
dollar-denominated securities held by the Portfolio may or may not be listed or
traded on a securities exchange. The Portfolio may invest in mortgage-backed
securities and in other asset-backed securities issued by non-governmental
entities such as banks and other financial institutions. Mortgage-backed
securities include mortgage pass-through securities and collateralized mortgage
obligations. Asset-backed securities are collateralized by such assets as
automobile or credit card receivables and are securitized either in a
pass-through structure or in a pay-through structure similar to a collateralized
mortgage obligation.

Investments in emerging country debt securities entail special investment
risks. Many of the emerging countries listed above may have less stable
political environments than more developed countries. Also, it may be more
difficult to obtain a judgement in a court outside the United States.

Global Fixed-Income Securities -- The global fixed-income securities in
which a portion of the Worldwide High Income Portfolio's assets may be invested
are debt securities denominated in currencies of countries displaying high real
yields. Such securities include government obligations issued or guaranteed by
U.S. or foreign governments and their political subdivisions, authorities,
agencies or instrumentalities, and by supranational entities (such as the World
Bank, The European Economic Community, The Asian Development Bank and the
European Coal and Steel Community), Eurobonds, and corporate bonds with varying
maturities denominated in various currencies. In this portion of the Portfolio,
the Subadviser seeks to minimize investment risk by investing in a high quality
portfolio of debt securities, the majority of which will be rated in one of the
two highest rating categories by a nationally recognized statistical rating
organization. U.S. government securities in which the Portfolio may invest
include obligations issued or guaranteed by the U.S. government, such as U.S.
Treasury securities, as well as those backed by the full faith and credit of the
United States, such as obligations of the Government National Mortgage
Association and The Export-Import Bank. The Portfolio may also invest in
obligations issued or guaranteed by U.S. government agencies or
instrumentalities where the Portfolio must look principally to the issuing or
guaranteeing agency for ultimate repayment. The Portfolio may invest in
obligations issued or guaranteed by foreign governments and their political
subdivisions, authorities, agencies or instrumentalities, and by supranational
entities (such as the World Bank, The European Economic Community, The Asian
Development Bank and the European Coal and Steel Community). Investment in
foreign government securities for this portion of the Portfolio will be limited
to those of developed nations which the Subadviser believes to pose limited
credit risk. These countries currently include Australia, Austria, Belgium,
Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, Luxembourg,
the Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland and
The United Kingdom. Corporate and supranational obligations selected for this
portion of the portfolio will be limited to those rated A or better by Moody's,
S&P or IBCA Ltd.

In selecting securities for this portion of the Portfolio, the Subadviser
evaluates the currency, market and individual features of the securities being
considered for investment. The Subadviser believes that countries displaying the
highest real yields will over time generate a high total return, and
accordingly, the Subadviser's focus for this portion of the Portfolio will be to
analyze the relative rates of real yield of twenty global fixed-income markets.
In selecting securities, the Subadviser will first identify the global markets
in which the Portfolio's assets will be invested by ranking such countries in
order of highest real yield. In this portion of its portfolio, the Portfolio
will invest its assets primarily in fixed-income securities denominated in the
currencies of countries within the top quartile of the Subadviser's ranking.

The Subadviser's assessment of the global fixed-income markets is based on
an analysis of real interest rates. The Subadviser calculates real yield for
each global market by adjusting current nominal yields of securities in each

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<PAGE> 16

such market for inflation prevailing in each country using an analysis of past
and projected (one-year) inflation rates for that country. The Subadviser
expects to review and update on a regular basis its real yield ranking of
countries and market sectors and to alter the allocation of this portion of the
Portfolio's investments among markets as necessary when changes to real yields
and inflation estimates significantly alter the relative rankings of the
countries and market sectors.

UTILITY PORTFOLIO

The Utility Portfolio seeks high current income and moderate capital
appreciation. The Portfolio's investment approach is based on the Subadviser's
conviction that over the long-term, the economy will continue to expand and
develop and that this economic growth will be reflected in the growth of the
revenues and earnings of utility companies. The Portfolio intends to achieve its
investment objective by investing in equity and debt securities of utility
companies that produce, transmit, or distribute gas and electric energy as well
as those companies that provide communications facilities, such as telephone and
telegraph companies.

The Portfolio will, under normal circumstances, invest at least 65% of its
total assets in securities of utility companies. Such investments will be
primarily in common stocks selected by the Subadviser on the basis of
traditional research techniques, including assessment of earnings and dividend
growth prospects and of the risk and volatility of an issuer's industry.
However, other factors, such as product position, market share, or profitability
will also be considered by the Subadviser. The Portfolio may also invest in
preferred stocks, corporate bonds, notes, and warrants of utility companies.
Fixed-income securities purchased by the Portfolio will be rated at least BBB by
S&P or Baa by Moody's.

The Portfolio may also invest in other types of securities and/or engage in
a variety of investment strategies, including: U.S. government securities; money
market instruments; foreign securities; illiquid securities; repurchase and
reverse repurchase agreements; securities lending; when-issued and
delayed-delivery transactions; and options, financial futures and options on
such futures. See "Description of Securities and Investment Techniques" for more
information on these securities and strategies. For temporary defensive
purposes, the Portfolio may invest up to 100% of its assets in cash, cash
equivalents and short-term debt instruments.

Risk Factors Applicable to Utility Securities -- There exist certain risks
associated with the utility industry of which investors in the Portfolio should
be aware. These include (i) utility companies' difficulty in earning adequate
returns on investment despite frequent rate increases; (ii) restrictions on
operations and increased costs and delays due to governmental regulations; (iii)
building or construction delays; (iv) environmental regulations; (v) difficulty
of the capital markets in absorbing utility debt and equity securities, and (vi)
difficulties in obtaining fuel at reasonable prices.

GENERAL RISKS. There are certain risks and considerations affecting
utility companies, and the holders of utility company securities, which an
investor should take into account when investing in those securities. Factors
which may adversely affect utility companies include: difficulty in financing
large construction programs during inflationary periods; technological
innovations which may cause existing plants, equipment, or products to become
less competitive or obsolete; the impact of natural or man-made disasters
(especially on regional utilities); increased costs or reductions in production
due to the unavailability of appropriate types of fuels; seasonally or
occasionally reduced availability or higher cost of natural gas; and reduced
demand due to energy conservation among consumers. These revenues of domestic
and foreign utility companies generally reflect the economic growth and
developments in the geographic areas in which they do business. Furthermore,
utility securities tend to be interest rate sensitive.

In addition, most utility companies in the United States and in foreign
countries are subject to government regulation. Generally, the purpose of such
regulation is to ensure desirable levels of service and adequate capacity to
meet public demand. To this end, prices are often regulated to enable consumers
to obtain service at what is perceived to be a fair price, while attempting to
provide utility companies with a rate of return sufficient to attract capital
investment necessary for continued operation and necessary growth. Recently,
utility regulators have permitted utilities to diversify outside of their
original geographic regions and their traditional lines of business. While the
Subadviser believes that these opportunities will permit certain utility
companies to earn more than their traditional regulated rates of return, other
companies may be forced to defend their core business and may be less
profitable. Of course, there can be no assurance that all of the regulatory
policies described in this paragraph will continue in the future.

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<PAGE> 17

In addition to the effects of regulation described in the previous
paragraph, utility companies may also be adversely affected by the following
regulatory considerations: the development and implementation of a national
energy policy; the differences between regulatory policies of different
jurisdictions (or different regulators which have concurrent jurisdiction);
shifts in regulatory policies; adequacy of rate increases; and future regulatory
legislation.

Foreign utility companies may encounter different risks and opportunities
than those located in the United States. Foreign utility companies may be more
heavily regulated than their United States counterparts. Many foreign utility
companies currently use fuels which cause more pollution than fuels used by
United States utilities. In the future, it may be necessary for such foreign
utility companies to invest heavily in pollution control equipment or otherwise
meet pollution restrictions. Rapid growth in certain foreign economies may
encourage the growth of utility industries in those countries.

In addition to the foregoing considerations which affect most utility
companies, there are specific considerations which affect specific utility
industries:

ELECTRIC. The electric utility industry is composed of companies that are
engaged in the generation, transmission, and sale of electric energy. Electric
utility companies may be affected either favorably or unfavorably, depending
upon the circumstances, by the following: fuel costs; financing costs; size of
the region in which sales are made; operating costs; environmental and safety
regulations; changes in the regulatory environment; and the length of time
needed to complete major construction projects.

In the United States, the construction and operation of nuclear power
facilities is subject to a high degree of regulatory oversight by the Nuclear
Regulatory Commission and state agencies with concurrent jurisdiction. In
addition, the design, construction, licensing, and operation of nuclear power
facilities are often subject to lengthy delays and unanticipated costs due to
changes in regulatory policy, regional political actions, and lawsuits.
Furthermore, during rate authorizations, utility regulators may disallow the
inclusion in electric rates of the higher operating costs and expenditures
resulting from these delays and unanticipated costs, including the costs of a
nuclear facility which a utility company may never by able to use.

TELECOMMUNICATIONS. The telephone industry is large and highly
concentrated. The greatest portion of this segment is composed of companies
which distribute telephone services and provide access to the telephone
networks. While many telephone companies have diversified into other businesses
in recent years, the profitability of telephone utility companies could be
adversely affected by increasing competition, technological innovations, and
other structural changes in the industry.

Cable television companies are typically local monopolies, subject to
scrutiny by both utility regulators and municipal governments. Emerging
technologies and legislation encouraging local competition are combining to
threaten these monopolies and may slow future growth rates of these companies.
The radio telecommunications segment of this industry, including cellular
telephone, is in its early developmental phase and is characterized by emerging,
rapidly growing companies.

GAS. Gas transmission and distribution companies are undergoing
significant changes. In the United States, the Federal Energy Regulatory
Commission is reducing its regulation of interstate transmission of gas. While
gas utility companies have in the recent past been adversely affected by
disruptions in the oil industry, increased concentration, and increased
competition, the Subadviser believes that environmental considerations should
benefit the gas industry in the future.

WATER. Water utility companies purify, distribute, and sell water. This
industry is highly fragmented because most of the water supplies are owned by
local authorities. Water utility companies are generally mature and are
experiencing little or no per capita volume growth. The Subadviser believes that
favorable investment opportunities may result if anticipated consolidation and
foreign participation in this industry occurs.

Reducing Risks of Utility Securities -- The Subadviser believes that the
risks of investing in utility securities can be reduced. The professional
portfolio management techniques used by the Subadviser to attempt to reduce
these risks include credit research and diversification techniques. The
Subadviser will perform its own credit analysis in addition to using recognized
rating agencies, and will obtain information from other sources, including the
issuer's management and other investment analysts. The Subadviser's credit
analysis will consider the issuer's financial soundness, its responsiveness to
changes in interest rates and business conditions, and its anticipated cash
flow,

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<PAGE> 18

interest or dividend coverage, and earnings. In evaluating an issuer, the
Subadviser places special emphasis on the estimated current value of the
issuer's assets rather than historical cost.

BALANCED/PHOENIX INVESTMENT COUNSEL PORTFOLIO

The Balanced/Phoenix Investment Counsel Portfolio seeks as its investment
objectives reasonable income, long-term capital growth and conservation of
capital. The Portfolio intends to invest based on combined considerations of
risk, income, capital enhancement and protection of capital value.

The Portfolio may invest in any type or class of security. Under normal
circumstances, the Portfolio will invest in common stocks and fixed-income
securities; however, it may also invest in securities convertible into common
stocks. At least 25% of the value of the Portfolio's assets will normally be
invested in fixed-income senior securities. The Portfolio may also engage in
certain options transactions and enter into financial futures contracts and
related options for hedging purposes, and may invest in zero coupon debt
obligations. Notwithstanding the foregoing, for temporary defensive purposes,
the Portfolio may actively pursue a policy of retaining cash or investing part
or all of its assets in cash equivalents, such as government securities and high
quality commercial paper. See "Description of Securities and Investment
Techniques" for a full discussion of the types of securities in which the
Portfolio may invest.

The Portfolio may invest up to 25% of the value of the Portfolio's total
assets in securities of foreign issuers, including emerging market securities
and those issued by foreign branches of U.S. banks. Such foreign investments may
involve a higher degree of risk than investments in domestic issuers. Foreign
securities are often denominated in foreign currencies, which means that their
value will be affected by changes in exchange rates, as well as other factors
that affect securities prices. Investment in foreign securities involves special
risks. See "Description of Securities and Investment Techniques -- Risks and
Considerations Applicable to Investment in Securities of Foreign Issuers."

With respect to investment in fixed-income securities, the Portfolio
intends to emphasize investments in investment grade fixed-income securities
which are rated within the four highest categories by recognized rating agencies
such as Moody's, S&P, Duff & Phelps or Fitch. However, the Portfolio may invest
in lower- or non-rated fixed-income securities, but will not invest more than
35% of its net assets, determined at the time of investment, in high-yield,
high-risk fixed-income securities. A fixed-income securities issue may have its
ratings reduced below the minimum permitted for purchase by the Portfolio. In
that event, the Subadviser will determine whether the Portfolio should continue
to hold such security. If, in the Subadviser's opinion, market conditions
warrant, the Portfolio may, from time to time, increase its position in lower-
and non-rated securities. Investment in lower-rated and unrated fixed-income
securities involves certain risks not attendant to higher rated securities. See
"Description of Securities and Investment Techniques -- Corporate Debt
Instruments and Risk Factors Relating to High-Yield Bonds" for a full discussion
of below investment grade fixed-income securities and the risks associated
therewith.

SUNAMERICA BALANCED PORTFOLIO

The investment objective of the SunAmerica Balanced Portfolio is to
conserve principal by maintaining at all times a balanced portfolio of stocks
and bonds. In seeking to achieve the investment objective of the Portfolio, the
Adviser has the flexibility to select among different types of investments for
capital growth and income and may alter the composition of the portfolio as
economic and market trends change. This investment approach, designated by the
Adviser as a "fully managed" investment policy, distinguishes the Portfolio from
many other investment companies, which often seek either capital appreciation or
current income.

The Adviser considers both the opportunity for gain and the risk of loss in
making investments. While the Adviser anticipates that, over the long term, the
Portfolio will consist primarily of equity investments, in the form of common
and preferred stocks, it may also invest in long-term bonds and other debt
securities such as convertible securities, short-term investments, U.S.
government securities and warrants and other rights. The Portfolio will, under
normal circumstances, invest at least 25% of its assets in fixed-income senior
securities; however, the fixed-income component will exceed 25% when the Adviser
believes such an adjustment in portfolio mix to be necessary in order to
conserve principal, such as in anticipation of decline in the equities market.

Flexibility to choose among various kinds of investments is a principal
feature of the Adviser's fully managed investment approach. The Adviser shifts
its emphasis among these different types of investments, as well as among
various industry sectors, as financial trends and economic conditions change.

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<PAGE> 19

In selecting equity investments, the Adviser typically seeks companies of
medium to large capitalizations (generally $1 billion or more) that, based on
their future prospects or opportunities, it believes are undervalued in the
marketplace. Consistent with the Adviser's approach to equity selection, the
Adviser will direct the sale of equity investments that it judges to be
overpriced or when it believes other investments offer better values.
Investments in companies with market capitalizations of less than $1 billion may
be more volatile than investments in companies with larger market
capitalizations, and thus the Portfolio intends to limit its investments in such
companies to no more than 20% of its total assets.

In selecting debt investments, the Adviser is primarily concerned with
determining the most appropriate time to buy and sell such securities. The
Adviser seeks debt securities with longer maturities during periods of
anticipated lower interest rates and shorter-term debt securities when interest
rates are expected to rise. The Adviser generally selects long-term debt
securities from high quality bonds (rated AA or higher by S&P, Aa or higher by
Moody's) to achieve income and capital gains. The Adviser may also invest the
Portfolio's assets in high quality, short-term debt securities (such as
commercial paper rated A-1 by S&P or P-1 by Moody's, or determined by the
Adviser to be of equivalent quality if unrated). However, the Adviser may invest
up to 10% of the value of the Portfolio's total assets (measured at the time of
investment) in securities rated as low as BBB by S&P or Baa by Moody's. See
"Fixed-Income Securities" in "Description of Securities and Investment
Techniques" below for a discussion of the risks associated with investing in
such securities. See also the Statement of Additional Information for a
description of securities ratings.

The Adviser may select equity and debt securities for the Portfolio issued
by either domestic or foreign issuers. See "Description of Securities and
Investment Techniques" for a description of the risks associated with foreign
securities.

ASSET ALLOCATION PORTFOLIO

The investment objective of the Asset Allocation Portfolio is high total
return (including income and capital gains) consistent with preservation of
capital over the long-term. The Portfolio seeks to achieve its objectives by
investing in a diversified portfolio that can include common stocks and other
securities having common stock characteristics, bonds and other intermediate and
long-term fixed-income securities, including mortgage-related and asset-backed
securities, and money market instruments (debt securities maturing in one year
or less). Securities designated as having "common stock" characteristics
include, but are not limited to, securities convertible into or exchangeable for
common stock.

The Subadviser of the Portfolio, GSAM, will determine the relative mix of
equities, fixed-income securities and money market instruments for the Portfolio
based on its view of long-term economic and market trends under the relative
risks and opportunities for long-term total return of the different classes of
assets. Under normal conditions, the Subadviser expects (but is not required) to
maintain an investment mix falling within the following ranges: 40% to 80% in
equities; 20% to 50% in fixed-income securities; and 0% to 40% in money market
instruments. The Subadviser may make frequent shifts within these broad ranges
whenever, in the Subadviser's judgment, market or economic changes warrant a
reallocation. The Subadviser intends in normal situations to make any shifts in
the Portfolio's asset allocation gradually over time based on its views of
long-term trends and conditions.

The Portfolio may invest in securities of foreign issuers (which are
generally denominated in currencies other than the U.S. dollar), although there
is no requirement that the Portfolio maintain investments in foreign issuers.
See "Description of Securities and Investment Techniques -- Risks and
Considerations Applicable to Investment in Securities of Foreign Issuers." The
Portfolio also has the ability to hold a portion of its assets in foreign
currencies and to enter into forward foreign currency exchange contracts,
currency options, currency swaps, currency and financial futures contracts, and
options on such futures contracts.

The Portfolio's fixed-income investments will consist primarily of
"investment grade" bonds; that is, bonds that are rated BBB or better by S&P or
Baa or better by Moody's. Up to 25% of the Portfolio's fixed-income assets may
be invested in securities that are below investment grade as defined above,
including securities rated as low as CC by S&P or Ca by Moody's. Securities
rated BBB or below by S&P or Baa or below by Moody's are considered to have
speculative characteristics. For a more detailed description of the risks
involved with these securities, see "Description of Securities and Investment
Techniques -- Corporate Debt Instruments -- Lower Grade" and "Risk Factors
relating to High Yield Bonds." The Portfolio's investments in foreign
fixed-income securities will be concentrated in securities issued or guaranteed
as to principal and interest by foreign governments or their agencies and
instrumentalities or by multinational agencies.

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<PAGE> 20

The Portfolio may enter into repurchase agreements and firm commitment
agreements, and may purchase when-issued securities. The Portfolio may also
engage in interest-rate swaps, mortgage swaps, transactions involving
interest-rate caps, floors and collars, dollar rolls and securities lending.

GROWTH-INCOME PORTFOLIO

The Growth-Income Portfolio seeks growth of capital and income. In the
selection of securities for investment, the possibilities of appreciation and
potential dividends are given more weight than current yield. Ordinarily, the
assets of the Portfolio consist principally of a diversified group of common
stocks, but other types of securities, including preferred stocks, corporate
bonds and convertible bonds, may be held when deemed advisable. The Subadviser
of the Portfolio, Alliance, determines the relative amounts to be invested in
common stocks, preferred stocks, bonds (including corporate and convertible),
securities of the U.S. government, its agencies and instrumentalities, cash and
cash equivalents (such as commercial bank and savings association obligations,
commercial paper and short-term corporate bonds and notes) and repurchase
agreements. See "Description of Securities and Investment Techniques."

ALLIANCE GROWTH PORTFOLIO

GROWTH/PHOENIX INVESTMENT COUNSEL PORTFOLIO
PROVIDENT GROWTH PORTFOLIO

The three Growth Portfolios have the same investment objectives, policies
and restrictions, but have different subadvisers. The investment objective of
each Portfolio is to seek long-term growth of capital. Whatever current income
is generated by the Portfolio is incidental to the objective of capital growth.
Each Portfolio's objective of capital growth is sought by investing primarily in
common stocks or securities with common stock characteristics. Securities
designated as having "common stock" characteristics include, but are not limited
to, securities convertible into or exchangeable for common stock. The potential
for appreciation of capital is the basis for investment decisions. Each
Portfolio's Subadviser considers the factors that it believes affect potential
for capital appreciation, including an issuer's current and projected revenue,
earnings, cash flow and assets, as well as general market conditions. When the
outlook for common stocks is not considered promising, for temporary defensive
purposes, a substantial portion of the assets may be invested in securities of
the U.S. government, its agencies and instrumentalities, cash and cash
equivalents (such as commercial bank and savings association obligations,
commercial paper and short-term corporate bonds and notes) and repurchase
agreements. Because the securities purchased by these Portfolios in pursuing
their investment objective are selected for growth potential rather than
production of income, the market values of such securities (and therefore, to a
large extent, the net asset values per share of the Portfolios) will tend to be
more volatile in response to market changes than they would be if income-
producing securities were sought for investment by the Portfolios. Up to 25% of
each Portfolio's total assets may be invested in foreign securities. See
"Description of Securities and Investment Techniques -- Risks and Considerations
Applicable to Investment in Securities of Foreign Issuers" and the Statement of
Additional Information.

FEDERATED VALUE PORTFOLIO

The Federated Value Portfolio seeks growth of capital and income. The
Portfolio pursues its investment objective by investing, under normal
circumstances, at least 65% of its assets in a portfolio of securities issued by
the one hundred companies contained in "The Leaders List" described below. The
Portfolio's investment approach is based upon the Subadviser's conviction that
over the longer term, the economy will continue to expand and develop and that
this economic growth will be reflected importantly in the growth of major
corporations. Generally, the Subadviser makes portfolio selections utilizing
fundamental analysis, with emphasis on the issuer's earning power, financial
condition and valuation.

The securities in which the Portfolio invests include, but are not limited
to: common stocks; preferred stocks; domestic issues of corporate debt
obligations; and warrants. The fixed-income securities in which the Portfolio
may invest must be rated, at the time of purchase, BBB or better by S&P, Baa by
Moody's, or BBB by Fitch. If a security loses its rating or has its rating
reduced after the Portfolio has purchased it, the Portfolio is not required to
sell the security, but will consider doing so.

The Portfolio may also invest in other securities and/or engage in various
investment strategies, including: foreign securities; repurchase agreements;
illiquid securities; and securities lending. See "Description of Securities and
Investment Techniques" for more information on these securities and strategies.
For temporary or defensive

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<PAGE> 21

purposes, the Portfolio may also hold cash and invest in U.S. government
securities in such proportions as the Subadviser may deem necessary for such
purposes.

"The Leaders List" is a trade name which represents a list of 100 blue chip
companies selected by the Subadviser. In the opinion of the Subadviser,
securities of these companies represent diversified and highly marketable
investments. The Subadviser uses its proprietary securities selection process to
evaluate the relative value of securities suitable for the Leaders List. The
Subadviser also uses a number of standards and fundamental research factors in
selecting "The Leaders List." "The Leaders List" generally includes leading
companies in their industries determined in terms of sales, earnings, and/or
market capitalization. Companies on the "Leaders List" typically have a market
capitalization in excess of $1 billion. The list is subject to continuous review
and modification.

VENTURE VALUE PORTFOLIO

The Venture Value Portfolio seeks growth of capital. Under normal
circumstances, the assets of the Portfolio will be invested in securities which
the Subadviser believes have above-average appreciation potential. Usually these
securities are common stocks. Income is not a significant factor in selecting
investments for the Portfolio.

Generally, the Portfolio will invest predominantly in equity securities of
companies with market capitalizations of at least $250 million. Investments will
consist of issues which the Subadviser believes have capital growth potential
due to factors such as undervalued assets or earnings potential, product
development and demand, favorable operating ratios, resources for expansion,
management abilities, reasonableness of market price, and favorable overall
business prospects.

The Portfolio may invest in securities of foreign issuers. Such foreign
investments may involve a higher degree of risk than investments in domestic
issuers. Foreign securities are often denominated in foreign currencies, which
means that their value will be affected by changes in exchange rates, as well as
other factors that affect securities prices.

The Portfolio will generally invest in securities of foreign companies
through trades of individual securities on recognized exchanges and developed
over-the-counter markets, through American Depositary Receipts (ADRs) covering
such securities, and through U.S. registered investment companies primarily
investing in foreign securities. With respect to other registered investment
companies, no such investment may cause more than 10% of the Portfolio's total
assets to be invested in such companies. Such other investment companies usually
have their own management costs or fees and the Portfolio's Subadviser earns its
regular fee on such assets.

To help reduce exposure to currency fluctuations, the Portfolio may trade
in forward foreign currency exchange contracts (forward contracts), currency
futures contracts and options thereon and securities indexed to foreign
securities. The Portfolio will use these techniques to lock in an exchange rate
in connection with transactions in securities denominated or traded in foreign
currencies, to hedge the currency risk in foreign securities held by the
Portfolio and to hedge a currency risk involved in an anticipated purchase of
foreign securities. The Portfolio may also utilize cross-hedging, that is,
entering into a hedge transaction in respect to a different foreign currency
than the one in which the Portfolio trade is to be made or in which a portfolio
security is principally traded. There is no limitation on the amount of assets
that may be committed to currency hedging; however, the Portfolio will not
engage in a futures transaction if it would cause the aggregate of initial
margin deposits and premiums paid on outstanding options on futures contracts to
exceed 5% of the value of total assets (excluding in calculating such 5% any
in-the-money amount of any option). The Portfolio intends to utilize currency
hedging transactions as a tool to reduce currency fluctuation risks due to a
current or anticipated position in foreign securities. The successful use of
currency hedging transactions usually depends on the Subadviser's ability to
forecast interest rate and currency exchange rate movements. Should interest or
exchange rates move in an unexpected manner, the Portfolio may not achieve the
anticipated benefits of futures contracts, options or forward contracts or may
realize losses and thus be in a worse position than if such strategies had not
been used. Unlike many exchange-traded futures contracts, there are no daily
price fluctuation limits with respect to options on currencies and forward
contracts, and adverse market movements could therefore continue to an unlimited
extent over a period of time. In addition, the correlation between movements in
the prices of such instruments and movements in the price of the securities and
currencies hedged or used for cover will not be perfect and could produce
unanticipated losses. Unanticipated changes in currency prices may result in
poorer overall performance for the Portfolio than if it had not entered into
such contracts. In taking a position in an anticipatory hedge, the Portfolio is
required to set aside cash or high grade liquid securities to fully secure the
obligation.

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<PAGE> 22

Sometimes a more defensive position may be desirable under certain economic
or financial circumstances. At these times, the Portfolio may without limitation
hold assets in cash and cash equivalents, including repurchase agreements, or in
fixed-income or other defensive securities rather than in securities selected
for appreciation potential. The Portfolio may also have such holdings
temporarily for the purpose of managing exceptional in-flows and out-flows of
cash.

The Portfolio may also engage in other types of investment practices,
including, but not limited to, investment in illiquid securities and lending of
portfolio securities. See "Description of Securities and Investment Techniques"
for a description of these investment techniques and a discussion of the other
techniques in which the Portfolio may engage.

AGGRESSIVE GROWTH PORTFOLIO

The Aggressive Growth Portfolio seeks capital appreciation as its
objective. The Portfolio pursues this investment objective by investing, under
normal circumstances, at least 65% of its total assets in the equity securities
of small, lesser known or new growth companies or industries, such as
telecommunications, media and biotechnology. Such "Small Cap" companies will
typically have, at the time of purchase, market capitalizations of under $1
billion and have achieved, or are expected to achieve, growth or earnings over
various major business cycles. The Portfolio may invest in securities issued by
well known and established domestic or foreign companies, as well as in newer
and less-seasoned companies. Such securities may be listed on an exchange or
traded over-the-counter. In addition, the Portfolio may invest up to 35% of its
total assets in debt securities that have the potential for capital appreciation
due to anticipated market conditions. The Portfolio may invest in securities
rated as low as BBB by S&P or Baa by Moody's.

Risks Associated With Investing in Small Companies -- Investing in smaller,
lesser known companies may involve certain risks not generally associated with
investments in larger, more well-established companies. For example, it may be
difficult to obtain reliable information and financial data on such companies
and the securities of these small companies may not be readily marketable,
making it difficult to dispose of shares when desirable. Also, securities of
small or emerging growth companies may be subject to more abrupt or erratic
market movements than larger, more established companies or the market average
in general. A risk of investing in smaller, emerging companies is that they
often have limited product lines, markets or financial resources, and their
securities may be subject to more abrupt or erratic market movements than
securities of larger, more established companies or the market averages in
general. Finally, certain issuers in which the Portfolio may invest may face
difficulties in obtaining the capital necessary to continue in operation and may
go into bankruptcy, which could result in a complete loss of the Portfolio's
investment.

GLOBAL EQUITIES PORTFOLIO

The investment objective of the Global Equities Portfolio is to achieve
long-term growth of capital through investment primarily in common stocks or
securities of U.S. and foreign issuers with common stock characteristics and
through transactions in foreign currencies. Securities designated as having
"common stock" characteristics include, but are not limited to, securities
convertible into or exchangeable for common stock. A major premise of the
Portfolio's investment approach is the Subadviser's belief that economic and
political developments have helped to create new opportunities worldwide.

The assets of the Portfolio will be invested with geographic flexibility.
Under normal market conditions, the Portfolio will invest at least 50% of its
assets in equity securities of issuers domiciled outside the U.S. However, for
temporary defensive purposes, it may invest up to 100% of its assets in
dollar-denominated securities or securities of U.S. issuers. The Portfolio's
Subadviser, Alliance, seeks to identify those companies, both domestic and
foreign, likely to benefit from long-term trends and shifting trade patterns as
they develop in the global economy. Alliance currently does not intend to invest
more than 20% of the Portfolio's total assets in issuers domiciled in, or
governments of, developing countries (i.e., those identified as such by the
international financial community).

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When prevailing market, economic, political or currency conditions warrant,
the Portfolio may purchase fixed-income securities (including securities of
governments other than the U.S., which may be securities of either national,
regional or local governments). For temporary defensive purposes, the Portfolio
may at times maintain all or any part of its assets in U.S. dollar-denominated
or foreign currency-denominated cash or cash equivalents (including U.S.
government securities, foreign government securities, certificates of deposit,
time deposits, commercial paper, bankers' acceptances and other high quality
short-term debt securities).

It is expected that the Portfolio will use currency transactions and
financial index futures both to enhance returns for a given level of risk and to
hedge its exposure to foreign currencies and local market conditions. While the
Portfolio will have both long and short currency positions, neither its net long
foreign currency exposure nor its net short foreign currency exposure will
exceed the value of the Portfolio's total assets. See "Description of Securities
and Investment Techniques -- Risks and Considerations Applicable to Investment
in Securities of Foreign Issuers" and the Statement of Additional Information.

INTERNATIONAL DIVERSIFIED EQUITIES PORTFOLIO

The investment objective of the International Diversified Equities
Portfolio is to provide long-term capital appreciation by investing in
accordance with country weightings determined by the Subadviser in common stocks
of foreign issuers which, in the aggregate, replicate broad country indices. The
Subadviser utilizes a top-down approach in selecting investments for the
Portfolio that emphasizes country selection and weighting rather than individual
stock selection. This approach reflects the Subadviser's philosophy that a
diversified selection of securities representing exposure to world markets,
based upon the economic outlook and current valuation levels for each country,
is an effective way to maximize the return and minimize the risk associated with
international investment.

The Subadviser determines country allocations for the Portfolio on an
ongoing basis within policy ranges dictated by each country's market
capitalization and liquidity. The Portfolio will invest in the industrialized
countries throughout the world that comprise the Morgan Stanley Capital
International EAFE (Europe, Australia and the Far East) Index. The Portfolio
will also invest in emerging country equity securities. As used with respect to
this Portfolio, the term "emerging country" applies to any country which, in the
opinion of the Subadviser, is generally considered to be an emerging or
developing country by the international financial community, including the
International Bank for Reconstruction and Development (more commonly known as
the World Bank) and the International Finance Corporation. There are currently
over 130 countries which, in the opinion of the Subadviser, are generally
considered to be emerging or developing countries by the international financial
community, approximately 40 of which currently have stock markets. These
countries generally include every nation in the world except the United States,
Canada, Japan, Australia, New Zealand and most nations located in Western
Europe. Currently, investing in many emerging countries is not feasible or may
involve unacceptable political risks. The Portfolio will focus its investments
on those emerging market countries in which it believes the economies are
developing strongly and in which the markets are becoming more sophisticated.
With respect to the portion of the Portfolio that is invested in emerging
country equity securities, the Portfolio initially intends to invest primarily
in some or all of the following countries:

<TABLE>
<S> <C> <C> <C>
Argentina Indonesia Portugal Thailand
Brazil Mexico South Africa Turkey
India Philippines South Korea
</TABLE>

As markets in other countries develop, the Portfolio expects to expand and
further diversify the emerging countries in which it invests. The Portfolio does
not intend to invest in any security in a country where the currency is not
freely convertible to U.S. dollars, unless the Portfolio has obtained the
necessary governmental licensing to convert such currency or other appropriately
licensed or sanctioned contractual guarantee to protect such investment against
loss of that currency's external value, or the Portfolio has a reasonable
expectation at the time the investment is made that such governmental licensing
or other appropriately licensed or sanctioned guarantee would be obtained or
that the currency in which the security is quoted would be freely convertible at
the time of any proposed sale of the security by the Portfolio.

An emerging country security is one issued by a company that, in the
opinion of the Subadviser, has one or more of the following characteristics: (i)
its principal securities trading market is in an emerging country; (ii) alone or
on a consolidated basis it derives 50% or more of its annual revenue from either
goods produced, sales made or services performed in emerging countries; or (iii)
it is organized under the laws of, and has a principal office in, an

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<PAGE> 24

emerging country. The Subadviser will base determinations as to eligibility on
publicly available information and inquiries made to the companies. See
"Description of Securities and Investment Techniques -- Risks and Considerations
Applicable to Investment in Securities of Foreign Issuers."

By analyzing a variety of macroeconomic and political factors, the
Subadviser develops fundamental projections on interest rates, currencies,
corporate profits and economic growth for each country. These country
projections are used then to determine what the Subadviser believes to be a fair
value for the stock market of each country. Discrepancies between actual value
and fair value as determined by the Subadviser provide an expected return for
each stock market. The expected return is adjusted by currency return
expectations derived from the Subadviser's purchasing-power parity exchange rate
model to arrive at an expected total return in U.S. dollars. The final country
allocation decision is then arrived at by considering the expected total return
in light of various country specific considerations such as market size,
volatility, liquidity and country risk.

Within a particular country, investments are made through the purchase of
common stocks which, in aggregate, replicate a broad market index, which in most
cases will be the Morgan Stanley Capital International EAFE Index for the given
country. The Subadviser may overweight or underweight an industry segment of a
particular index if it concludes this would be advantageous to the Portfolio.
Common stocks purchased for the Portfolio include common stocks and equivalents,
such as securities convertible into common stocks and securities having common
stock characteristics, such as rights and warrants to purchase common stocks.
Indexation of the Portfolio's stock selection reduces stock-specific risk
through diversification and minimizes transaction costs, which can be
substantial in foreign markets.

Common stocks purchased for the Portfolio normally will be listed on a
major stock exchange in the subject country. The Portfolio will not invest in
the stocks of U.S. issuers. For a description of special considerations and
certain risks associated with investments in foreign issuers, see "Description
of Securities and Investment Techniques -- Risks and Considerations Applicable
to Investment in Securities of Foreign Issuers." The Portfolio may temporarily
reduce its equity holdings in response to adverse market conditions and invest
in domestic, Eurodollar and foreign short-term money market instruments for
defensive purposes.

The Portfolio may also engage in certain options transactions and enter
into financial futures contracts and related options for hedging purposes.

DESCRIPTION OF SECURITIES AND INVESTMENT TECHNIQUES

FIXED-INCOME SECURITIES -- Fixed-income securities are broadly
characterized as those that provide for periodic payments to the holder of the
security at a stated rate. Most fixed-income securities, such as bonds,
represent indebtedness of the issuer and provide for repayment of principal at a
stated time in the future. Others, such as some preferred stocks, do not provide
for repayment of a principal amount, although they may represent a priority over
common stockholders in the event of the issuer's liquidation. Many fixed-income
securities are subject to scheduled retirement, or may be retired or "called" by
the issuer prior to their maturity dates.

The market values of fixed-income securities tend to vary inversely with
the level of interest rates -- when interest rates rise, their values will tend
to decline; when interest rates decline, their values generally will rise. Long-
term instruments are generally more sensitive to these changes than are
short-term instruments. The market value of fixed-income securities and
therefore their yield are also affected by the perceived ability of the issuer
to make timely payments of principal and interest.

CORPORATE DEBT INSTRUMENTS -- These instruments, such as bonds, represent
the obligation of the issuer to repay a principal amount of indebtedness at a
stated time in the future and, in the usual case, to make periodic interim
payments of interest at a stated rate.

Investment Grade -- A designation applied to intermediate and
long-term corporate debt securities rated within the highest four rating
categories assigned by S&P (AAA, AA, A or BBB) or by Moody's (Aaa, Aa, A or
Baa). The ability of the issuer of an investment grade debt security to pay
interest and to repay principal is considered to vary from extremely strong
(for the highest ratings) through adequate (for the lowest ratings given
above), although the lower-rated investment grade securities may be viewed
as having speculative elements as well.

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<PAGE> 25

Lower Grade -- A designation applied to intermediate and long-term
corporate debt securities that are not investment grade; commonly referred
to as "junk bonds". These include bonds rated BB or below by S&P, or Ba or
below by Moody's. These securities are considered speculative.

The Corporate Bond and High-Yield Bond Portfolios may invest in bonds rated
as low as Ca by Moody's (or CC by S&P) and may invest no more than 10% of their
total assets in bonds rated as low as C by Moody's or D by S&P. The Corporate
Bond and Worldwide High Income Portfolios may invest in bonds rated as low as C
by Moody's or D by S&P without limitation. The Asset Allocation and
Balanced/Phoenix Investment Counsel Portfolios may invest in bonds rated as low
as Ca by Moody's or CC by S&P. Bonds rated Ca by Moody's are described as
"speculative in a high degree; often in default or having other marked
shortcomings." Bonds rated D by Moody's -- the lowest rated class -- can be
"regarded as having extremely poor prospects of ever attaining any real
investment standing." Bonds rated C by S&P are of the "highest degree of
speculation"; those rated D by that organization are in default and in arrears.
Bonds with other lower grade ratings by Moody's are described as follows:
Ba -- have speculative elements; future cannot be considered as well assured.
The protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the future.
Bonds in this class are characterized by uncertainty of position. B -- generally
lack characteristics of the desirable investment; assurance of interest and
principal payments or of maintenance of other terms of the contract over any
long period of time may be small. Caa -- of poor standing. Issues may be in
default or there may be present elements of danger with respect to principal or
interest. Bonds with other lower grade ratings by S&P are described as follows:
BB, B, CCC, CC -- regarded, on balance, as predominately speculative with
respect to capacity to pay interest and repay principal in accordance with the
terms of the obligation. While this debt will likely have some quality and
protective characteristics, these are outweighed by large uncertainties or major
risk exposures to adverse conditions. C1 -- reserved for income bonds on which
no interest is being paid. See the Statement of Additional Information for a
more complete description of bond ratings.

RISK FACTORS RELATING TO HIGH-YIELD BONDS -- High-yield, high-risk bonds
are subject to greater fluctuations in value than are higher-rated bonds because
the values of high-yield bonds tend to reflect short-term corporate, economic
and market developments and investor perceptions of the issuer's credit quality
to a greater extent. Although under normal market conditions longer-term
securities yield more than shorter-term securities, they are subject to greater
price fluctuations. Fluctuations in the value of a Portfolio's investments will
be reflected in the Portfolio's net asset value per share. The high-yield bond
market is relatively new. Its initial growth paralleled a long economic
expansion, followed by an economic downturn which severely disrupted the market
for high-yield bonds and adversely affected the value of outstanding bonds and
the ability of the issuers to repay principal and interest. The economy may
affect the market for high-yield bonds in a similar fashion in the future
including an increased incidence of defaults on such bonds. From time to time,
legislation may be enacted which could have a negative effect on the market for
high-yield bonds.

High-yield bonds present the following risks:

Sensitivity to Interest Rate and Economic Changes -- High-yield,
high-risk bonds are very sensitive to adverse economic changes and
corporate developments. During an economic downturn or substantial period
of rising interest rates, highly leveraged issuers may experience financial
stress that would adversely affect their ability to service their principal
and interest payment obligations, to meet projected business goals and to
obtain additional financing. If the issuer of a bond defaulted on its
obligations to pay interest or principal or entered into bankruptcy
proceedings, a Portfolio may incur losses or expenses in seeking recovery
of amounts owed to it. In addition, periods of economic uncertainty and
changes can be expected to result in increased volatility of market prices
(and therefore yields) of high-yield bonds and the Portfolio's net asset
value.

Payment Expectations -- High-yield, high-risk bonds may contain
redemption or call provisions. If an issuer exercised these provisions in a
declining interest-rate market, a Portfolio would have to replace the
security with a lower-yielding security, resulting in a decreased return
for investors. Conversely, a high-yield bond's value will decrease in a
rising interest rate market, as will the value of the Portfolio's assets.
If the Portfolio experiences unexpected net redemptions, this may force it
to sell high-yield bonds without regard to their investment merits, thereby
decreasing the asset base upon which expenses can be spread and possibly
reducing the Portfolio's rate of return.

Liquidity and Valuation -- There may be little trading in the
secondary market for particular bonds, which may affect adversely a
Portfolio's ability to value accurately or dispose of such bonds. Under
such circumstances, the task of accurate valuation becomes more difficult
and judgment would play a greater role

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<PAGE> 26

due to the relative lack of reliable and objective data. Adverse publicity
and investor perceptions, whether or not based on fundamental analysis, may
decrease the values and liquidity of high-yield bonds, especially in a thin
market.

The Adviser or Subadviser attempts to reduce these risks through
diversification of the applicable Portfolio and by credit analysis of each
issuer, as well as by monitoring broad economic trends and corporate and
legislative developments. If a high-yield bond previously acquired by a
Portfolio is downgraded, the Adviser or Subadviser, as appropriate, will
evaluate the security and determine whether to retain or dispose of it.

U.S. GOVERNMENT SECURITIES -- Securities guaranteed by the U.S. government
include: (1) direct obligations of the U.S. Treasury (such as Treasury bills,
notes and bonds) and (2) federal agency obligations guaranteed as to principal
and interest by the U.S. Treasury (such as Government National Mortgage
Association ("GNMA") certificates and Federal Housing Administration
debentures). For these securities, the payment of principal and interest is
unconditionally guaranteed by the U.S. government. They are of the highest
possible credit quality. These securities are subject to variations in market
value due to fluctuations in interest rates, but if held to maturity, are
guaranteed by the U.S. government to be paid in full.

Securities issued by the U.S. government instrumentalities and certain
federal agencies are neither direct obligations of, nor are they guaranteed by,
the Treasury. However, they involve federal sponsorship in one way or another:
some are backed by specific types of collateral; some are supported by the
issuer's right to borrow from the Treasury; some are supported by the
discretionary authority of the Treasury to purchase certain obligations of the
issuer; others are supported only by the credit of the issuing government agency
or instrumentality. These agencies and instrumentalities include, but are not
limited to Federal Land Banks, Farmers Home Administration, Central Bank for
Cooperatives, Federal Intermediate Credit Banks and Federal Home Loan Banks.

GNMA CERTIFICATES -- GNMA certificates are mortgage-backed securities
representing part ownership of a pool of mortgage loans on which timely payment
of interest and principal is guaranteed by the full faith and credit of the U.S.
government. GNMA certificates differ from typical bonds because principal is
repaid monthly over the term of the loan rather than returned in a lump sum at
maturity. Because both interest and principal payments (including prepayments)
on the underlying mortgage loans are passed through to the holder of the
certificate, GNMA certificates are called "pass-through" securities.

Although the mortgage loans in the pool have maturities of up to 30 years,
the actual average life of the GNMA certificates typically will be substantially
less because the mortgages are subject to normal principal amortization and may
be prepaid prior to maturity. Prepayment rates vary widely and may be affected
by changes in market interest rates. In periods of falling interest rates, the
rate of prepayment tends to increase, thereby shortening the actual average life
of the GNMA certificates. Conversely, when interest rates are rising, the rate
of prepayment tends to decrease, thereby lengthening the actual average life of
the GNMA certificates. Accordingly, it is not possible to predict accurately the
average life of a particular pool. Reinvestment of prepayments may occur at
higher or lower rates than the original yield on the certificates. Due to the
prepayment feature and the need to reinvest prepayments of principal at current
rates, GNMA certificates can be less effective than typical bonds of similar
maturities at "locking-in" yields during periods of declining interest rates,
although they may have comparable risks of decline in value during periods of
rising interest rates.

FNMA AND FHLMC MORTGAGE-BACKED OBLIGATIONS -- The Federal National Mortgage
Association ("FNMA"), a federally chartered and privately owned corporation,
issues pass-through securities representing an interest in a pool of
conventional mortgage loans. FNMA guarantees the timely payment of principal and
interest but this guarantee is not backed by the full faith and credit of the
U.S. government. The Federal Home Loan Mortgage Corporation ("FHLMC"), a
corporate instrumentality of the United States, issues participation
certificates that represent an interest in a pool of conventional mortgage
loans. FHLMC guarantees the timely payment of interest and the ultimate
collection of principal and maintains reserves to protect holders against losses
due to default, but the certificates are not backed by the full faith and credit
of the U.S. government. As is the case with GNMA certificates, the actual
maturity of and realized yield on particular FNMA and FHLMC pass-through
securities will vary based on the prepayment experience of the underlying pool
of mortgages.

OTHER MORTGAGE-RELATED SECURITIES -- The Corporate Bond, Global Bond,
Balanced/Phoenix Investment Counsel, SunAmerica Balanced and Asset Allocation
Portfolios may invest in collateralized mortgage obligations ("CMOs") or
mortgage-backed bonds issued by financial institutions such as commercial banks,
savings and loan associations, mortgage banks and securities broker-dealers (or
affiliates of such institutions established to issue

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<PAGE> 27

these securities). CMOs are obligations fully collateralized directly or
indirectly by a pool of mortgages on which payments of principal and interest
are dedicated to payment of principal and interest on the CMOs. Payments on the
underlying mortgages (both interest and principal) are passed through to the
holders, although not necessarily on a pro rata basis, on the same schedule as
they are received. Mortgage-backed bonds are general obligations of the issuer
fully collateralized directly or indirectly by a pool of mortgages. The
mortgages serve as collateral for the issuer's payment obligations on the bonds,
but interest and principal payments on the mortgages are not passed through
either directly (as with GNMA certificates and FNMA and FHLMC pass-through
securities) or on a modified basis (as with CMOs). Accordingly, a change in the
rate of prepayments on the pool of mortgages could change the effective maturity
of a CMO but not that of a mortgage-backed bond (although, like many bonds,
mortgage-backed bonds may be callable by the issuer prior to maturity).

The Corporate Bond, Global Bond and Asset Allocation Portfolios may also
invest in stripped mortgage-backed securities ("SMBS"), which are derivative
multiclass mortgage securities, provided they are issued or guaranteed by the
U.S. government, its agencies or instrumentalities. SMBS are usually structured
with two classes that receive different proportions of the interest and
principal distributions from a pool of mortgage assets. A common type of SMBS
will have one class receiving all of the interest from the mortgage assets,
while the other class will receive all of the principal. However, in some
instances, one class will receive some of the interest and most of the principal
while the other class will receive most of the interest and the remainder of the
principal. If the underlying mortgage assets experience greater-than-anticipated
prepayments of principal, the Portfolio may fail to fully recoup its initial
investment in these securities. Although the market for such securities is
increasingly liquid, certain SMBS may not be readily marketable and will be
considered illiquid for purposes of the Portfolios' limitation on investments in
illiquid securities. The market value of the class consisting entirely of
principal payments generally is unusually volatile in response to changes in
interest rates. The yields on a class of SMBS that receives all or most of the
interest from mortgage assets are generally higher than prevailing market yields
on other mortgage-backed securities because their cash flow patterns are more
volatile and there is a greater risk that the initial investment will not be
fully recouped.

ASSET-BACKED SECURITIES -- These securities represent an interest in a pool
of consumer or other types of loans ("asset-backed securities"). Payments of
principal and interest on the underlying loans are passed through to the holders
of asset-backed securities over the life of the securities. Some asset-backed
securities may be subject to early prepayment of principal, which can be
expected to accelerate during periods of declining interest rates. Such
prepayments can usually be reinvested only at the lower yields then prevailing
in the market. Therefore, during periods of declining interest rates,
asset-backed securities are less likely than other fixed-income obligations to
appreciate in value and less effective at locking in a particular yield. On the
other hand, asset-backed securities are subject to substantially the same risk
of depreciation during periods of rising interest rates as other fixed-income
securities.

SECURITIES LENDING -- Certain Portfolios may from time to time lend
securities to banks, brokers and dealers and receive as collateral cash or
securities issued or guaranteed by the U.S. government or its agencies, or any
combination thereof, which collateral will be required to be maintained at all
times in an amount equal to at least 100% of the current value of the loaned
securities plus accrued interest. Such loans are not made if as a result the
aggregate of all outstanding loans exceeds 33 1/3% of the value of the
Portfolio's total assets. A Portfolio will continue to be entitled to the
interest payable on the loaned securities and will either receive as income a
portion of the interest on the investment of any cash loan collateral or, in the
case of collateral other than cash, a fee negotiated with the borrower. The
terms of such loans will provide that they are terminable at any time. Loans of
securities involve risks of delay in receiving additional collateral or in
recovering the securities loaned or even loss of rights in the collateral in the
event of the insolvency of the borrower of the securities. A Portfolio will have
the right to regain record ownership of loaned securities in order to exercise
voting and other beneficial rights. A Portfolio may pay reasonable fees in
connection with arranging such loans.

DOLLAR ROLLS -- The Corporate Bond, Global Bond, Balanced/Phoenix
Investment Counsel, SunAmerica Balanced and Asset Allocation Portfolios may
enter into "dollar rolls" in which the Portfolio sells mortgage or other
asset-backed securities ("Roll Securities") for delivery in the current month
and simultaneously contracts to repurchase substantially similar (same type,
coupon and maturity) securities on a specified future date. During the roll
period, the Portfolio foregoes principal and interest paid on the Roll
Securities. A Portfolio is compensated by the difference between the current
sales price and the lower forward price for the future purchase (often referred
to as the "drop") as well as by the interest earned on the cash proceeds of the
initial sale. A Portfolio also could be compensated through the receipt of fee
income equivalent to a lower forward price. A "covered roll" is a specific type

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<PAGE> 28

of dollar roll for which there is an offsetting cash position or a cash
equivalent security position which matures on or before the forward settlement
date of the dollar roll transaction. The Portfolio will hold and maintain in a
segregated account until the settlement date cash or liquid, high grade debt
securities in an amount equal to the forward purchase price. The Portfolios will
only enter into covered rolls. Covered rolls are not treated as a borrowing or
other senior security and will be excluded from the calculation of each
Portfolio's borrowings and other senior securities. Because "roll" transactions
involve both the sale and purchase of a security, they may cause the reported
portfolio turnover rate to be higher than that reflecting typical portfolio
management activities.

Dollar rolls involve certain risks including the following: if the
broker-dealer to whom the Portfolio sells the security becomes insolvent, the
Portfolio's right to purchase or repurchase the security subject to the dollar
roll may be restricted and the instrument which the Portfolio is required to
repurchase may be worth less than an instrument which the Portfolio originally
held. Successful use of dollar rolls will depend upon the Adviser's or
Subadviser's ability to predict correctly interest rates and in the case of
mortgage dollar rolls, mortgage prepayments. For these reasons, there is no
assurance that dollar rolls can be successfully employed.

SHORT-TERM DEBT SECURITIES -- Debt securities maturing within one year of
date of the purchase include (1) commercial bank obligations (certificates of
deposit, bankers' acceptances (time drafts on a commercial bank where the bank
accepts an irrevocable obligation to pay at maturity) and documented discount
notes (corporate promissory discount notes accompanied by a commercial bank
guarantee to pay at maturity)), (2) savings association obligations
(certificates of deposit issued by mutual savings banks or savings and loan
associations), (3) commercial paper (short-term notes with maturities of up to 9
months issued by corporations or governmental bodies), (4) corporate bonds and
notes (corporate obligations that mature, or that may be redeemed, in one year
or less), and (5) adjustable-rate mortgage securities backed by GNMA, FNMA,
FHLMC and other non-agency issuers. Although certain floating or variable rate
obligations (securities whose coupon rate changes at least annually and
generally more frequently) have maturities in excess of one year, they are also
considered short-term debt securities.

ZERO-COUPON, PAY-IN-KIND AND DEFERRED INTEREST BONDS -- The Corporate Bond,
Global Bond, High-Yield Bond, Worldwide High Income, Balanced/Phoenix Investment
Counsel, SunAmerica Balanced, Asset Allocation and Venture Value Portfolios may
invest in zero-coupon bonds and deferred interest bonds. In addition, the
Corporate Bond, High-Yield Bond and Worldwide High Income Portfolios may invest
in pay-in-kind securities. Zero-coupon, deferred interest and capital
appreciation bonds are debt obligations which are issued at a significant
discount from face value that do not entitle the holder to any payment of
interest prior to maturity or a specified commencement or redemption date (or
cash payment date). The original discount approximates the total amount of
interest the bonds will accrue and compound over the period until maturity or
the first interest accrual date at a rate of interest reflecting the computed
market rate for the security at the time of issuance. While zero-coupon bonds do
not require any periodic payment of interest, deferred interest bonds generally
provide for a period of delay before the regular payment of interest begins.
Although this period of delay is different for each deferred interest bond, a
typical period is approximately one-third of the bond's term to maturity. Such
investments benefit the issuer by mitigating its initial need for cash to meet
debt service, but some also provide a higher rate of return to attract investors
who are willing to defer receipt of such cash. Pay-in-kind securities are
securities that have interest payable by delivery of additional securities. Upon
maturity, the holder is entitled to receive the aggregate par value of the
securities. Such investments experience greater volatility in market value due
to changes in interest rates than do debt obligations, which provide for regular
payments of interest. A Portfolio will accrue income on such investments for tax
and accounting purposes, as required, which is distributable to shareholders and
which, because no cash is received at the time of accrual, may require the
liquidation of other portfolio securities under unfavorable circumstances to
satisfy the Portfolio's distribution obligations.

REPURCHASE AGREEMENTS -- Each Portfolio may enter into repurchase
agreements, under which the Portfolio buys a security and obtains a simultaneous
commitment from the seller to repurchase the security at a specified time and
price. Repurchase agreements permit the Portfolio to maintain liquidity and earn
income over periods of time as short as overnight. The seller must maintain
collateral with the Trust's custodian equal to at least 102% of the repurchase
price, including accrued interest, as monitored daily by the Adviser or
applicable Subadviser. A Portfolio only will enter into repurchase agreements
involving securities in which it could otherwise invest and with selected banks
and securities dealers whose financial condition is monitored by the Adviser or
applicable Subadviser, subject to the oversight of the Board of Trustees. If the
seller under the repurchase agreement defaults, the Portfolio may incur a loss
if the value of the collateral securing the repurchase agreement has declined,
and may incur disposition

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costs in connection with liquidating the collateral. If bankruptcy proceedings
are commenced with respect to the seller, realization of the collateral by the
Portfolio may be delayed or limited.

REVERSE REPURCHASE AGREEMENTS -- The Cash Management, Corporate Bond,
High-Yield Bond, Worldwide High Income, Utility, SunAmerica Balanced, Federated
Value and Aggressive Growth Portfolios may enter into reverse repurchase
agreements. In a reverse repurchase agreement, the Portfolio sells a security
subject to the right and obligation to repurchase such security. The Portfolio
then invests the proceeds from the transaction in another obligation in which
the Portfolio is authorized to invest. In order to minimize any risk involved,
the Portfolio maintains in a segregated account with the custodian cash, cash
equivalents or liquid high grade debt securities equal in value to the
repurchase price.

ILLIQUID SECURITIES -- Each of the Portfolios may invest no more than 15%
(10% in the case of the Cash Management Portfolio) of the value of its net
assets in securities which are illiquid, including repurchase agreements
providing for settlement in more than seven days after notice, interest-rate and
currency swaps, caps, floors and collars. For this purpose, not all securities
which are restricted are deemed to be illiquid. For example, restricted
securities which the Board of Trustees, or the Adviser (or Subadviser, as the
case may be) pursuant to guidelines established by the Board of Trustees, has
determined to be marketable, such as securities eligible for sale under Rule
144A promulgated under the Securities Act of 1933, as amended, or certain
private placements of commercial paper issued in reliance on an exemption from
such Act pursuant to Section 4(2) thereof, will not be deemed to be illiquid for
purposes of this restriction. This investment practice could have the effect of
increasing the level of illiquidity in the Portfolio to the extent that
qualified institutional buyers (as defined in Rule 144A) become for a time
uninterested in purchasing these restricted securities. In addition, a
repurchase agreement which by its terms can be liquidated before its nominal
fixed-term on seven days or less notice is regarded as a liquid instrument.
Subject to the applicable limitation on illiquid securities investments, a
Portfolio may acquire securities issued by the U.S. government, its agencies or
instrumentalities in a private placement. See "Illiquid Securities" in the
Statement of Additional Information for a further discussion of investments in
such securities.

FIRM COMMITMENT AGREEMENTS AND WHEN-ISSUED AND DELAYED-DELIVERY
TRANSACTIONS -- Each Portfolio may purchase securities on a firm commitment,
when-issued or delayed-delivery basis. Firm commitment agreements and
when-issued or delayed-delivery transactions call for the purchase or sale of
securities at an agreed-upon price on a specified future date. While a Portfolio
will only purchase securities on a when-issued or delayed-delivery basis with
the intention of acquiring the securities, the Portfolio may sell the securities
before the settlement date, if it is deemed advisable to do so. At the time a
Portfolio makes the commitment to purchase securities on a when-issued or
delayed-delivery basis, the Portfolio will record the transaction and thereafter
reflect the value, each day, of such security in determining the net asset value
of the Portfolio. At the time of delivery of the securities, the value may be
more or less than the purchase price. A Portfolio will maintain in a segregated
account liquid assets having a value equal to or greater than the Portfolio's
purchase commitments. The Portfolio will likewise segregate liquid assets with
respect to securities sold on a delayed-delivery basis.

INTEREST-RATE SWAPS, MORTGAGE SWAPS, CAPS, FLOORS AND COLLARS -- In order
to protect the value of the Corporate Bond, Global Bond and Asset Allocation
Portfolios from interest rate fluctuations and to hedge against fluctuations in
the fixed-income market in which the Portfolio's investments are traded, the
Portfolios may enter into interest-rate swaps and mortgage swaps or purchase or
sell interest-rate caps, floors or collars. A Portfolio will enter into these
hedging transactions primarily to preserve a return or spread on a particular
investment or portion of the portfolio and to protect against any increase in
the price of securities the Portfolio anticipates purchasing at a later date.
The Global Bond Portfolio may also enter into interest-rate swaps for
non-hedging purposes. Interest-rate swaps involve the exchange by the Portfolio
with another party of their respective commitments to pay or receive interest,
e.g., an exchange of floating-rate payments for fixed-rate payments. Since
interest-rate swaps are individually negotiated, the Portfolios expect to
achieve an acceptable degree of correlation between their respective portfolio
investments and their interest-rate positions. The Portfolios will only enter
into interest-rate swaps on a net basis, which means that the two payment
streams are netted out, with the Portfolios receiving or paying, as the case may
be, only the net amount of the two payments. Interest-rate swaps do not involve
the delivery of securities, other underlying assets or principal. Accordingly,
the risk of loss with respect to interest-rate swaps is limited to the net
amount of interest payments that the Portfolio is contractually obligated to
make. If the other party to an interest-rate swap defaults, the Portfolio's risk
of loss consists of the net amount of interest payments that the Portfolio is
contractually entitled to receive, if any. The use of interest-rate swaps is a
highly specialized activity which involves investment techniques and risks
different from those associated with ordinary portfolio securities transactions.

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Mortgage swaps are similar to interest-rate swaps in that they represent
commitments to pay and receive interest. The notional principal amount, upon
which the value of the interest payments is based, is tied to a reference pool
or pools of mortgages.

The purchase of an interest-rate cap entitles the purchaser, to the extent
that a specified index exceeds a predetermined interest rate, to receive
payments of interest on a notional principal amount from the party selling such
interest-rate cap. The purchase of an interest-rate floor entitles the
purchaser, to the extent that a specified index falls below a predetermined
interest rate, to receive payments of interest on a notional principal amount
from the party selling such interest rate floor. An interest-rate collar is the
combination of a cap and a floor that preserves a certain return within a
predetermined range of interest rates.

The Portfolios will not enter into any mortgage swap, interest-rate swap,
cap or floor transaction unless the unsecured commercial paper, senior debt, or
the claims paying ability of the other party thereto is rated either AA or A-1
or better by S&P or Aa or P-1 or better by Moody's, or is determined to be of
equivalent quality by the applicable Subadviser.

STRUCTURED SECURITIES -- The Global Bond Portfolio may invest in structured
notes, bonds or debentures, the value of the principal of and/or interest on
which is determined by reference to changes in the value of specific currencies,
interest rates, commodities, indices or other financial indicators (the
"Reference") or the relative change in two or more References. The interest rate
or the principal amount payable upon maturity or redemption may be increased or
decreased depending upon changes in the applicable Reference. The terms of the
structured securities may provide that in certain circumstances no principal is
due at maturity and, therefore, may result in the loss of the Portfolio's
investment. Structured securities may be positively or negatively indexed, so
that appreciation of the Reference may produce an increase or decrease in the
interest rate or value of the security at maturity. In addition, the change in
interest rate or the value of the security at maturity may be a multiple of the
change in the value of the Reference. Consequently, structured securities entail
a greater degree of market risk than other types of debt obligations. Structured
securities may also be more volatile, less liquid and more difficult to price
accurately than less complex securities.

BORROWING AND OTHER FORMS OF LEVERAGE -- The Worldwide High Income and
Aggressive Growth Portfolios are authorized to borrow money from banks and other
entities in an amount equal to up to 33 1/3% of their total assets (including
the amount borrowed), less all liabilities and indebtedness other than the
borrowing, and may use the proceeds of the borrowing for investment purposes, to
pay dividends or for other temporary purposes. Borrowing creates leverage which
is a speculative characteristic. Although a Portfolio is authorized to borrow,
it will do so only when the Adviser or Subadviser believes that borrowing will
benefit the Portfolio after taking into account considerations such as the costs
of borrowing and the likely investment returns on securities purchased with
borrowed monies. Borrowing by a Portfolio will create the opportunity for
increased net income but, at the same time, will involve special risk
considerations. Leveraging results from borrowing will magnify declines as well
as increases in a Portfolio's net asset value per share and net yield. The
Portfolios expect that all of their borrowing will be made on a secured basis.
The Portfolios' custodian will either segregate the assets securing the
borrowing for the benefit of the lenders or arrangements will be made with a
suitable subcustodian. If assets used to secure a borrowing decrease in value, a
Portfolio may be required to pledge additional collateral to the lender in the
form of cash or securities to avoid liquidation of those assets.

Each of the other Portfolios is authorized to borrow up to 33 1/3% of total
assets from banks for temporary purposes. Such other Portfolios may not purchase
any additional securities while the value of its borrowings exceeds 5% of its
total assets.

Notwithstanding the foregoing, pursuant to California Department of
Insurance borrowing guidelines, the Worldwide High Income and Aggressive Growth
Portfolios may each only borrow up to 10% of its net assets for investment
purposes and each Portfolio may only borrow up to 25% of its net assets for
temporary or emergency purposes.

RISKS AND CONSIDERATIONS APPLICABLE TO INVESTMENT IN SECURITIES OF FOREIGN
ISSUERS -- Elements of risk and opportunity when investments in foreign issuers
are made include trade imbalances and related economic policies; currency
fluctuations; foreign exchange control policies; expropriation or confiscatory
taxation; limitation on the removal of funds or other assets; political or
social instability; the diverse structure and liquidity of securities markets in
various countries and regions; policies of governments with respect to possible
nationalization of their industries; and other specific local political and
economic considerations. Foreign companies and foreign investment

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practices are generally not subject to uniform accounting, auditing and
financial reporting standards and practices or regulatory requirements
comparable to those of U.S. companies. There may be less information publicly
available about foreign companies. Investment decisions made in the context of
the Portfolios' objectives and policies involve the evaluation of opportunities
and risks presented by probable future currency relationships, especially during
periods of broad adjustments in such relationships.

With respect to its non-U.S. holdings, pursuant to California Department of
Insurance diversification guidelines, a Portfolio will invest in securities with
issuers located in at least five different foreign countries at all times with
no country representing more than 20% of the Portfolio's non-U.S. assets.
However, this minimum number of countries is reduced to four when foreign
country investments comprise less than 80% of the Portfolio's net assets; to
three countries when less than 60% of net assets; to two countries when less
than 40% of net assets; and to one when less than 20% of net assets.

An additional 15% of a Portfolio's non-U.S. assets may be invested in
securities of issuers located in any one of the following countries: Australia,
Canada, France, Japan, the United Kingdom or Germany. This policy is not deemed
a fundamental policy and therefore may be changed without shareholder approval.

Investment may be made from time to time in issuers domiciled in, or
governments of, developing countries as well as developed countries. Although
there is no universally accepted definition, a developing or emerging market
country is generally considered to be a country which is in the initial stages
of its industrialization cycle with a low per capita gross national product.
Historical experience indicates that the markets of developing countries have
been more volatile than the markets of developed countries; however, such
markets can provide higher rates of return to investors. The risks described
above with respect to investment in foreign securities generally may be
exacerbated with respect to investments in developing or emerging countries.

The performance of investments in securities denominated in a foreign
currency ("non-dollar securities") will depend on, among other things, the
strength of the foreign currency against the dollar and the interest rate
environment in the country issuing the foreign currency. Absent other events
which could otherwise affect the value of non-dollar securities (such as a
change in the political climate or an issuer's credit quality), appreciation in
the value of the foreign currency generally can be expected to increase the
value of a Portfolio's non-dollar securities in terms of U.S. dollars. A rise in
foreign interest rates or decline in the value of foreign currencies relative to
the U.S. dollar generally can be expected to depress the value of the
Portfolio's non-dollar securities. Currencies are evaluated on the basis of
fundamental economic criteria (e.g., relative inflation levels and trends,
growth rate forecasts, balance of payments status and economic policies) as well
as technical and political data.

Additional costs could be incurred in connection with a Portfolio's foreign
investment activities. Foreign brokerage commissions are generally higher than
in the U.S. and a Portfolio will bear certain expenses in connection with its
foreign currency transactions. Increased custodian costs as well as
administrative difficulties (such as the applicability of foreign laws to
foreign custodians in various circumstances including bankruptcy, ability to
recover lost assets, expropriation, nationalization, record access, etc.) may be
associated with the maintenance of assets in foreign jurisdictions.

OPTIONS ON SECURITIES AND SECURITIES INDICES -- Each Portfolio may write
(sell) covered call and put options on any securities in which it may invest.
All call options written by each Portfolio are covered, which means that the
Portfolio will own the securities subject to the option so long as the option is
outstanding. All put options written by each Portfolio are covered, which means
that the Portfolio would have deposited with its custodian cash, U.S. government
securities or other high-grade liquid debt securities with a value at least
equal to the exercise price of the put option. A Portfolio may also write call
and put options on any securities index composed of securities in which it may
invest. A Portfolio may purchase put and call options on any securities in which
it may invest or options on any securities index composed of securities in which
it may invest.

Each Portfolio may purchase and write options on the yield "spread," or
yield differential between two securities. Such transactions are referred to as
"yield curve" options. In contrast to other types of options, a yield curve
option is based on the difference between the yields of designated securities,
rather than the prices of the individual securities, and is settled through cash
payments. Accordingly, a yield curve option is profitable to the holder if this
differential widens (in the case of a call) or narrows (in the case of a put),
regardless of whether the yields of the underlying securities increase or
decrease. All yield curve options written by a Portfolio will be covered in the
manner described above.

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There is no assurance that a liquid secondary market on a domestic or
foreign options exchange will exist for any particular exchange-traded option or
at any particular time. If a Portfolio is unable to effect a closing purchase
transaction with respect to covered options it has written, the Portfolio will
not be able to sell the underlying securities or dispose of assets held in a
segregated account until the options expire or are exercised. Similarly, if a
Portfolio is unable to effect a closing sale transaction with respect to options
it has purchased, it would have to exercise the options in order to realize any
profit and will incur transaction costs upon the purchase or sale of the
underlying securities. In a closing purchase or sale transaction, a Portfolio
acquires a position that offsets and cancels an option position then held by the
Portfolio.

A Portfolio may purchase and sell both options that are traded (i) on U.S.
exchanges, (ii) on foreign exchanges and (iii) over-the-counter with
broker-dealers who make markets in these options. The ability to terminate
over-the-counter options is more limited than with exchange-traded options and
may involve the risk that broker-dealers participating in such transactions will
not fulfill their obligations. Until such time as the staff of the U.S.
Securities and Exchange Commission ("SEC") changes its position, each Portfolio
will treat purchased over-the-counter options and all assets used to cover
written over-the-counter options as illiquid securities. However, for options
written with primary dealers in U.S. government securities pursuant to an
agreement requiring a closing purchase transaction at a formula price, the
amount of illiquid securities may be calculated with reference to a formula
approved by the SEC staff.

The writing and purchase of options is a highly specialized activity which
involves investment techniques and risks different from those associated with
ordinary portfolio securities transactions. The use of options to increase total
return involves the risk of loss if the Adviser or Subadviser is incorrect in
its expectations of fluctuations in securities prices or interest rates. The
successful use of puts for hedging purposes depends in part on the ability of
the Adviser or Subadviser to predict future price fluctuations and the degree of
correlation between the options and securities markets. A Portfolio pays
brokerage commissions or spreads in connection with its options transactions.
The writing of options could significantly increase portfolio turnover rate of a
Portfolio and, therefore, associated brokerage commissions or spreads.

FUTURES CONTRACTS AND OPTIONS THEREON -- Futures contracts may be based on
various securities (including U.S. government securities), securities indices,
foreign currencies and other financial instruments and indices. The purchases of
futures contracts or call options thereon can serve as a long hedge, and the
sale of futures or the purchase of put options thereon can serve as a short
hedge. Writing covered call options on futures contracts can serve as a limited
short hedge, using a strategy similar to that used for writing covered call
options on securities and indices.

In addition, subject to regulations promulgated by the Commodity Futures
Trading Commission, a Portfolio may engage in futures transactions for
non-hedging purposes. For example, futures strategies can be used to manage the
average duration of a Portfolio. To shorten the average duration of a Portfolio,
the Portfolio may sell a futures contract or a call option thereon, or purchase
a put option on that futures contract; to lengthen the average duration of a
Portfolio, the Portfolio may buy a futures contract or a call option thereon.

No price is paid upon entering into a futures contract. Instead, at the
inception of a futures contract a Portfolio is required to deposit in a
segregated account with the Trust's custodian, in the name of the futures broker
through whom the transaction was effected, "initial margin" consisting of cash,
U.S. government securities or other liquid, high-grade debt securities, in an
amount generally equal to 10% or less of the contract value. Margin must also be
deposited when writing a call option on a futures contract, in accordance with
applicable exchange rules. Unlike margin in securities transactions, initial
margin on futures contracts does not represent a borrowing, but rather is in the
nature of a performance bond or good-faith deposit that is returned to the
Portfolio at the termination of the transaction if all contractual obligations
have been satisfied. Under certain circumstances, such as periods of high
volatility, the Portfolio may be required by an exchange to increase the level
of its initial margin payment, and initial margin requirements might be
increased generally in the future by regulatory action.

Subsequent "variation margin" payments are made to and from the futures
broker daily as the value of the futures position varies, a process known as
"marking to market." Variation margin does not involve borrowing, but rather
represents a daily settlement of the Portfolio's obligations to or from a
futures broker. When a Portfolio purchases an option on a future, the premium
paid plus transaction costs is all that is at risk. In contrast, when a
Portfolio purchases or sells a futures contract or writes a call option thereon,
it is subject to daily variation margin calls that could be substantial in the
event of adverse price movements. If the Portfolio has insufficient cash to meet
daily variation margin requirements, it might need to sell securities at a time
when such sales are disadvantageous.

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While transactions in futures contracts and options on futures may reduce
certain risks, such transactions themselves entail certain other risks. Thus,
while a Portfolio may benefit from the use of futures and options on futures,
unanticipated changes in interest rates, securities prices or currency exchange
rates may result in a poorer overall performance for the Portfolio than if it
had not entered into any futures contracts or options transactions. The loss
incurred by a Portfolio in writing options on futures is potentially unlimited
and may exceed the amount of the premium received.

In the event of an imperfect correlation between a futures position and a
portfolio position which is intended to be protected, the desired protection may
not be obtained and a Portfolio may be exposed to risk of loss. In addition, it
is not possible to hedge fully or perfectly against currency fluctuations
affecting the value of securities denominated in foreign currencies because the
value of such securities is also likely to fluctuate as a result of independent
factors not related to currency fluctuations. Therefore, perfect correlation
between a Portfolio's futures positions and portfolio positions will be
impossible to achieve.

Investment in futures contracts or options thereon may also involve
liquidity risks due, for example, to exchange-imposed daily trading limits that
would prevent the Portfolio from liquidating an unfavorable position. See the
Statement of Additional Information concerning futures and options contracts.

FOREIGN CURRENCY TRANSACTIONS -- Currency exchange rate fluctuations are a
major area of risk and opportunity for the Global Bond, Worldwide High Income,
Global Equities, and International Diversified Equities Portfolios, and is of
some risk to the other Portfolios. Each Portfolio has the ability to hold a
portion of its assets in foreign currencies and to enter into forward foreign
currency exchange contracts. Each may also purchase and sell exchange-traded
futures contracts relating to foreign currency and purchase and sell put and
call options on currencies and futures contracts. A significant portion of the
Portfolios' currency transactions will be over-the-counter transactions.

Each Portfolio may enter into forward foreign currency exchange contracts
to reduce the risks of fluctuations in exchange rates; however, these contracts
cannot eliminate all such risks and do not eliminate fluctuations in the prices
of the Portfolio's portfolio securities. For example, purchasing (selling) a
currency forward limits a Portfolio's exposure to risk of loss from a rise
(decline) in the U.S. dollar value of the currency, but also limits its
potential for gain from a decline (rise) in the currency's U.S. dollar value.

Each Portfolio may purchase and write put and call options on currencies
for the purpose of protecting against declines in the U.S. dollar value of
foreign portfolio securities and against increases in the U.S. dollar cost of
foreign securities to be acquired. As with other kinds of option transactions,
however, the writing of an option on currency will constitute only a partial
hedge, up to an amount of the premium received. A Portfolio could be required to
purchase or sell currencies at disadvantageous exchange rates, thereby incurring
losses. The purchase of an option on currency may constitute an effective hedge
against exchange rate fluctuations; however, in the event of exchange rate
movements adverse to the Portfolio's position, the Portfolio may forfeit the
entire amount of the premium plus related transaction costs.

Each Portfolio, other than the Global Bond, Worldwide High Income, Global
Equities and International Diversified Equities Portfolios, will not speculate
in currency contracts or options; that is, they will not engage in such
transactions involving an amount of currency in excess of i) the market value of
the securities denominated in that currency which it owns or has committed to
purchase or anticipates purchasing, or ii) current or anticipated payment
obligations in that currency. The Global Bond, Worldwide High Income, Global
Equities and International Diversified Equities Portfolios may, however, enter
into forward foreign currency exchange contracts, currency options and currency
swaps for non-hedging purposes when the Subadviser anticipates that a foreign
currency will appreciate or depreciate in value, but securities denominated in
that currency do not present attractive investment opportunities or are not
included in the Portfolio. Each Portfolio may use currency contracts and options
to cross-hedge, which involves selling or purchasing instruments on one currency
to hedge against changes in exchange rates for a different currency with a
pattern of correlation. To limit any leverage in connection with currency
contract transactions involving the purchase of currency, each Portfolio will
segregate liquid assets such as cash, U.S. government securities or other
appropriate high-grade obligations in an amount sufficient to meet its payment
obligations in these transactions. Initial margin deposits made in connection
with currency futures transactions or premiums paid for currency options traded
over-the-counter or on a commodities exchange may each not exceed 5% of each
Portfolio's total assets. See the Statement of Additional Information for more
information regarding foreign currency transactions.

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The Global Bond, Worldwide High Income, Asset Allocation, Global Equities
and International Diversified Equities Portfolios may enter into currency swaps.
Currency swaps involve the exchange by the Portfolio with another party of their
respective rights to make or receive payments in specified currencies. Since
currency swaps are individually negotiated, the Portfolio expects to achieve an
acceptable degree of correlation between its portfolio investments and its
currency swap positions. Currency swaps usually involve the delivery of the
entire principal value of one designated currency in exchange for the other
designated currency. Therefore, the entire principal value of a currency swap is
subject to the risk that the other party to the swap will default on its
contractual delivery obligations. The use of currency swaps is a highly
specialized activity which involves investment techniques and risks different
from those associated with ordinary portfolio securities transactions. If a
Subadviser is incorrect in its forecasts of market values and currency exchange
rates, the investment performance of the respective Portfolio would be less
favorable than it would have been if this investment technique were not used.

WARRANTS -- Certain Portfolios may invest in warrants which give the holder
of the warrant a right to purchase a given number of shares of a particular
issue at a specified price until expiration.

INVERSE FLOATERS -- The Corporate Bond and Asset Allocation Portfolios may
invest in leveraged inverse floating rate debt instruments ("inverse floaters").
The interest rate on an inverse floater resets in the opposite direction from
the market rate of interest to which the inverse floater is indexed. An inverse
floater may be considered to be leveraged to the extent that its interest rate
varies by a magnitude that exceeds the magnitude of the change in the index rate
of interest. The higher degree of leverage inherent in inverse floaters is
associated with greater volatility in their market values. Accordingly, the
duration of an inverse floater may exceed its stated final maturity. Certain
inverse floaters may be deemed to be illiquid securities for purposes of a
Portfolio's 15% limitation on investments in such securities.

MANAGEMENT

The Trust's Board of Trustees is responsible for the overall supervision of
the operations of the Trust and performs various duties imposed on trustees of
investment companies by the 1940 Act. The Board has retained others to provide
certain services to the Trust.

INVESTMENT ADVISER -- The Trust, on behalf of each Portfolio, entered into
an Investment Advisory and Management Agreement (the "Agreement") with SAAMCo to
handle the Trust's day-to-day affairs. It is the responsibility of the Adviser
and, for certain Portfolios pursuant to Subadvisory Agreements described below,
the Subadvisers to make investment decisions for the Portfolios and to place the
purchase and sale orders for the Portfolio transactions. Such orders may be
directed to any broker including, in the manner and to the extent permitted by
applicable law, affiliates of the Adviser or a Subadviser. The individual
Portfolio Managers for both the Adviser and Subadvisers are identified in the
"Portfolio Management" subsection of this section.

SAAMCo, located at The SunAmerica Center, 733 Third Avenue, New York, New
York 10017-3204, is a corporation organized in 1982 under the laws of the State
of Delaware. SAAMCo is an indirect, wholly owned subsidiary of Anchor National
Life Insurance Company, which is an indirect subsidiary of SunAmerica Inc., an
investment grade financial services company which has total capital of
approximately $1.8 billion. SAAMCo is engaged in providing investment advice and
management services to the Trust, other mutual funds and private accounts. As of
November 30, 1995, SAAMCo and its affiliates managed, advised and/or
administered assets of approximately $7.5 billion. SAAMCo provides investment
advisory services, office space, and other facilities for the management of the
affairs of the Trust, and pays the compensation of certain officers of the Trust
who are affiliated persons of SAAMCo.

The annual rates of the investment advisory fees which apply to the Cash
Management Portfolio are .55% on the first $100 million of Assets, .50% on the
next $200 million and .45% on Assets over $300 million. The annual rates of the
investment advisory fees which apply to the Corporate Bond Portfolio are .70% on
the first $50 million of Assets, .60% on the next $100 million, .55% on the next
$100 million and .50% on Assets over $250 million. The annual rates of the
investment advisory fees which apply to both the Global Bond and Asset
Allocation Portfolios are .75% on the first $50 million of Assets, .65% on the
next $100 million, .60% on the next $100 million and .55% on Assets over $250
million. The annual rates of the investment advisory fees which apply to the
High-Yield Bond Portfolio are .70% on the first $50 million of Assets, .65% on
the next $100 million, .60% on the next $100 million, .55% on Assets over $250
million. The annual rate of the investment advisory fees which apply to each of
the Worldwide High Income and International Diversified Equities Portfolios are
1.00%. The annual rates of the

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investment advisory fees which apply to the Utility and Federated Value
Portfolios are .75% on the first $150 million of Assets, .60% on the next $350
million and .50% on Assets over $500 million. The annual rates of the investment
advisory fees which apply to each of the Balanced/Phoenix Investment Counsel,
SunAmerica Balanced, Growth-Income, Alliance Growth, and Growth/Phoenix
Investment Counsel Portfolios are .70% on the first $50 million of Assets, .65%
on the next $100 million, .60% on the next $150 million, .55% on the next $200
million, and .50% on Assets over $500 million. The annual rates of the
investment advisory fees which apply to the Provident Growth Portfolio are .85%
on the first $50 million of Assets, .80% on the next $100 million, .70% on the
next $100 million, .65% on the next $100 million and .60% on Assets over $350
million. The annual rates of the investment advisory fees which apply to the
Venture Value Portfolio are .80% on the first $100 million of Assets, .75% on
the next $400 million and .70% on Assets over $500 million. The annual rates of
the investment advisory fees which apply to the Aggressive Growth Portfolio are
.75% on the first $100 million of Assets, .675% on the next $150 million, .625%
on the next $250 million and .60% on Assets over $500 million. The annual rate
of the investment advisory fees which apply to the Global Equities Portfolio are
.90% on the first $50 million of Assets, .80% on the next $100 million, .70% on
the next $150 million and .65% of Assets over $300 million.

For the fiscal year ended November 30, 1995, the following Portfolios paid
to SAAMCo a fee equal to the following percentage of average daily net assets:
Cash Management Portfolio -- .55%, High-Yield Bond Portfolio -- .69%,
Growth-Income Portfolio -- .67%, Alliance Growth Portfolio -- .68%,
Growth/Phoenix Investment Counsel Portfolio -- .67%, Provident Growth
Portfolio -- .83%, Global Equities Portfolio -- .83%, Corporate Bond
Portfolio -- .70%, Global Bond Portfolio -- .75%, Asset Allocation
Portfolio -- .68%, Worldwide High Income Portfolio -- 1.00%, International
Diversified Equities Portfolio -- 1.00%, Balanced/Phoenix Investment Counsel
Portfolio -- .70% and Venture Value Portfolio -- .79%.

The term "Assets" means the average daily net assets of the Portfolio. The
investment advisory fees are accrued daily and paid monthly.

SUBADVISERS -- The organizations described below act as subadvisers to the
Trust and certain of its Portfolios pursuant to Subadvisory Agreements with
SAAMCo. Under the Subadvisory Agreements, the Subadvisers manage the investment
and reinvestment of the assets of the respective Portfolios for which they are
responsible. Each of the Subadvisers is independent of SAAMCo and discharges its
responsibilities subject to the policies of the Trustees and the oversight and
supervision of SAAMCo, which pays the Subadvisers' fees.

The subadviser for the Alliance Growth, Growth-Income and Global Equities
Portfolios is Alliance Capital Management L.P. Alliance is a Delaware limited
partnership with principal offices at 1345 Avenue of the Americas, New York, New
York 10105.

Alliance is a major international investment manager, supervising client
accounts with assets totalling over $147.6 billion as of November 30, 1995.
Alliance serves its clients, who primarily are major corporate employee benefit
funds, investment companies, foundations, endowment funds and public employee
retirement systems, with a staff of more than 1,400 employees. Alliance has five
U.S. offices and its subsidiaries have nine offices outside the U.S. The 50
registered investment companies managed by Alliance, comprising 104 separate
investment portfolios, currently have over 1 million shareholders. As of
November 30, 1995, Alliance was retained as an investment manager of employee
benefit fund assets for 29 of the Fortune 100 companies.

The portion of the annual investment advisory fees received by SAAMCo which
is paid to Alliance with respect to the Alliance Growth Portfolio and the
Growth-Income Portfolio is .35% on the first $50 million of Assets, .30% on the
next $100 million, .25% on the next $150 million, .20% on the next $200 million
and .15% on Assets over $500 million; and, with respect to the Global Equities
Portfolio, .50% on the first $50 million of Assets, .40% on the next $100
million, .30% on the next $150 million and .25% on Assets over $300 million.

For the fiscal year ended November 30, 1995, SAAMCo paid to Alliance, with
respect to each Portfolio subadvised by Alliance, a fee equal to the following
percentage of average daily net assets: Alliance Growth Portfolio -- .33%,
Growth-Income Portfolio -- .32%, and Global Equities Portfolio -- .43%.

The subadviser of the Venture Value Portfolio is Davis Selected Advisers,
L.P., 124 East Marcy Street, Sante Fe, New Mexico 87501. Venture Advisers, Inc.
is the sole General Partner of the limited partnership, which, in turn, is
controlled by Shelby M.C. Davis. Davis Selected provides advisory services to
other investment companies. As of November 30, 1995, Davis Selected had $4
billion of assets under management.

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The portion of the annual investment advisory fee received by SAAMCo which
is paid to Davis Selected with respect to the Venture Value Portfolio is .45% on
the first $100 million of Assets, .40% on the next $400 million and .35% on
Assets over $500 million. For the fiscal year ended November 30, 1995, SAAMCo
paid to Davis Selected, with respect to the Venture Value Portfolio, a fee equal
to .44% of the Portfolio's average daily net assets.

The subadviser for the Corporate Bond, Federated Value and Utility
Portfolios is Federated Investment Counseling, Federated Investors Tower, 1001
Liberty Avenue, Pittsburgh, Pennsylvania 15222-3779. Federated is a wholly owned
subsidiary of Federated Investors, and together with other subsidiaries of
Federated Investors serves as investment adviser to a number of investment
companies and private accounts. With over $80 billion invested across more than
260 funds under management and/or administration as of March 1, 1996, Federated
Investors is one of the largest mutual fund investment managers in the United
States.

The portion of the annual investment advisory fees received by SAAMCo which
is paid to Federated with respect to the Corporate Bond Portfolio is .30% on the
first $25 million of Assets, .25% on the next $25 million, .20% on the next $100
million and .15% on Assets over $150 million; and with respect to each of the
Federated Value and Utility Portfolios is .55% on the first $20 million of
Assets, .35% on the next $30 million, .25% on the next $100 million, .20% on the
next $350 million and .15% on Assets over $500 million.

The subadviser for the Asset Allocation Portfolio is GSAM, a separate
operating division of Goldman, Sachs & Co. Prior to June 3, 1996, GSAM also
served as the subadviser for the Corporate Bond Portfolio. The subadviser for
the Global Bond Portfolio is GSAM-International, an affiliate of Goldman, Sachs
& Co. Goldman, Sachs & Co. is a Delaware limited partnership with its principal
offices at 85 Broad Street, New York, New York 10004.

GSAM serves a wide range of clients including private and public pension
funds, endowments, foundations, banks, thrifts, insurance companies,
corporations, and private investors and family groups. The asset management
services are divided into the following areas: institutional fixed-income
investment management; global currency management; institutional equity
investment management; fund management; money market mutual fund management and
administration; and private asset management. As of November 30, 1995, GSAM,
together with its affiliates, acted as investment adviser, administrator or
distributor for approximately $54.6 billion in assets.

GSAM-International was organized in 1990 as a company with limited
liability under the laws of England. It is authorized to conduct investment
advisory business in the United Kingdom as a member of the Investment Management
Regulatory Organisation Limited, a United Kingdom self-regulatory organization.

GSAM and GSAM-International are able to draw on the research and market
expertise of Goldman, Sachs & Co. in making investment decisions for the
Portfolios for which they act as Subadviser. In performing their subadvisory
services, GSAM and GSAM-International, while remaining ultimately responsible
for the management of the Portfolio, are able to draw upon the research and
expertise of their affiliate offices, for portfolio decisions and management
with respect to certain portfolio securities.

The portion of the annual investment advisory fees received by SAAMCo which
is paid to GSAM with respect to the Asset Allocation Portfolio is .40% on the
first $50 million of Assets, .30% on the next $100 million, .25% on the next
$100 million and .20% on Assets over $250 million.

For the fiscal year ended November 30, 1995, SAAMCo paid to GSAM, with
respect to the Asset Allocation Portfolio, a fee equal to .33% of the
Portfolio's average daily net assets; and with respect to the Corporate Bond
Portfolio, a fee equal to .35% of the Portfolio's average daily net assets.

The portion of the annual investment advisory fees received by SAAMCo which
is paid to GSAM-International with respect to the Global Bond Portfolio is .40%
on the first $50 million of Assets, .30% on the next $100 million, .25% on the
next $100 million and .20% on Assets over $250 million. For the fiscal year
ended November 30, 1995, SAAMCo paid to GSAM-International, with respect to the
Global Bond Portfolio, a fee equal to .40% of the Portfolio's average daily net
assets.

The subadviser of the International Diversified Equities and Worldwide High
Income Portfolios is Morgan Stanley Asset Management Inc., 1221 Avenue of the
Americas, New York, New York 10020. MSAM is a wholly owned subsidiary of Morgan
Stanley Group Inc., and provides a broad range of portfolio management services
to customers in the United States and abroad. As of November 30, 1995, MSAM,
together with its affiliated investment management companies, had approximately
$55.2 billion of assets under management (inclusive of assets under fiduciary
advisory control).

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The portion of the annual investment advisory fee received by SAAMCo which
is paid to MSAM with respect to each of the International Diversified Equities
and Worldwide High Income Portfolios is .65% on Assets up to $350 million and
.60% on Assets thereafter. For the fiscal year ended November 30, 1995, SAAMCo
paid to MSAM, with respect to the International Diversified Equities Portfolio
and Worldwide High Income Portfolio, a fee equal to .65% of each Portfolio's
average daily net assets.

The subadviser of the Growth/Phoenix Investment Counsel and
Balanced/Phoenix Investment Counsel Portfolios is Phoenix Investment Counsel,
Inc., a subsidiary of Phoenix Duff & Phelps Corp. Phoenix is located at One
American Row, Hartford, Connecticut 06115-250. Phoenix was originally organized
in 1932 as John P. Chase, Inc. and has been engaged in the management of mutual
funds since 1958. As of November 30, 1995, Phoenix had over $23.6 billion in
total assets under management for all its clients.

The portion of the annual investment advisory fees received by SAAMCo which
is paid to Phoenix with respect to each of the Growth/Phoenix Investment Counsel
and Balanced/Phoenix Investment Counsel Portfolios is .35% on the first $50
million of Assets, .30% on the next $100 million; .25% on the next $150 million;
.20% on the next $200 million and .15% on Assets over $500 million. For the
fiscal year ended November 30, 1995, SAAMCo paid to Phoenix, with respect to the
Growth/Phoenix Investment Counsel Portfolio, a fee equal to .32% of the
Portfolio's average daily net assets. For the fiscal year ended November 30,
1995, SAAMCo paid to Phoenix, with respect to the Balanced/Phoenix Investment
Counsel Portfolio, a fee equal to .35% of the Portfolio's percentage average
daily net assets.

The subadviser of the Provident Growth Portfolio is Provident Investment
Counsel, Inc., an autonomous wholly owned subsidiary of United Asset Management
Corporation, a financial services holding company. Provident was originally
formed as an investment partnership in 1951. Its address is 300 North Lake
Avenue, Pasadena, California 91101. As of November 30, 1995, total assets under
management for all clients was $18 billion.

The portion of the annual investment advisory fees received by SAAMCo which
is paid to Provident with respect to the Provident Growth Portfolio is .50% on
the first $50 million of Assets, .45% on the next $100 million, .35% on the next
$100 million, .30% on the next $100 million and .25% on Assets over $350
million. For the fiscal year ended November 30, 1995, SAAMCo paid to Provident,
with respect to the Provident Growth Portfolio, a fee equal to .48% of the
Portfolio's average daily net assets.

PORTFOLIO MANAGEMENT -- The following individuals are primarily responsible
for the day-to-day management of the particular Portfolios as indicated below.

P. Christopher Leary has served as the portfolio manager of the CASH
MANAGEMENT PORTFOLIO since the inception date of February 9, 1993. Mr. Leary is
a Senior Vice President of SAAMCo and has been a portfolio manager with the firm
since 1990. Mr. Leary is assisted by John J. DiVito who has been with SAAMCo
since November of 1994.

Joseph M. Balestrino serves as co-portfolio manager of the CORPORATE BOND
PORTFOLIO. Mr. Balestrino joined Federated Investors in 1986 and has been a Vice
President of Federated Advisers since 1995. Mr. Balestrino is a Chartered
Financial Analyst.

Mark E. Durbiano serves as co-portfolio manager of the CORPORATE BOND
PORTFOLIO. Mr. Durbiano joined Federated Investors in 1982 and has been a Senior
Vice President of Federated Advisers since January 1996. Mr. Durbiano is a
Chartered Financial Analyst.

Stephen Fitzgerald served as a portfolio manager for the GLOBAL BOND
PORTFOLIO since the inception date of July 1, 1993 and is now the sole portfolio
manager. Mr. Fitzgerald is Vice President in the London office, and joined
GSAM-International in 1992. Prior to 1992, he spent two years managing
multi-currency, fixed-income and balanced portfolios at Invesco MIM Limited
where he was a senior member of the derivative products group.

Howard B. Udis has served as the portfolio manager of the HIGH-YIELD BOND
PORTFOLIO since August 14, 1995. Mr. Udis has been an assistant portfolio
manager with SAAMCo since January 1993 and an assistant portfolio manager of the
Portfolio since February 9, 1993. Previously, Mr. Udis was a portfolio manager
with Value Line, Inc.

Robert Angevine and Paul Ghaffari have served as co-portfolio managers of
the WORLDWIDE HIGH INCOME PORTFOLIO since the inception date of October 28,
1994. Mr. Angevine is a principal of Morgan Stanley & Co. Incorporated and a
portfolio manager for high yield investments. He has been with the firm since
1988. Mr. Ghaffari

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is also a principal of Morgan Stanley and a portfolio manager with Morgan
Stanley Asset Management Inc. He has been with the firm since 1983.

Christopher H. Wiles serves as co-portfolio manager of the UTILITY
PORTFOLIO. Mr. Wiles joined Federated Investors in 1990 and has been a Vice
President of Federated Advisers since 1992. Mr. Wiles is a Chartered Financial
Analyst.

Linda A. Duessel serves as co-portfolio manager of the UTILITY PORTFOLIO.
Ms. Duessel joined Federated Investors in 1991, and has been a Vice President of
Federated Advisers since 1995. Ms. Duessel is a Certified Public Accountant and
a Chartered Financial Analyst.

C. Edwin Riley, Jr. has served as the portfolio manager of the
BALANCED/PHOENIX INVESTMENT COUNSEL PORTFOLIO since November 17, 1995. Prior to
joining Phoenix Investment Counsel in August 1995, Mr. Riley held the position
of Senior Vice President and Director of Equity Management at Nationsbank
Investment Management.

Stanton J. Feeley serves as the portfolio manager for the SUNAMERICA
BALANCED PORTFOLIO. Mr. Feeley is an Executive Vice President of SAAMCo and
serves as the firm's Chief Investment Officer. Mr. Feeley has 31 years
experience in the investment industry, including experience in institutional
sales management, and has been with the firm since 1992.

Mitchell E. Cantor has served as a co-portfolio manager for the equity
portion of the ASSET ALLOCATION PORTFOLIO since the inception date of July 1,
1993. Mr. Cantor is a Vice President of GSAM and joined the company in 1991.

Ronald E. Gutfleish has served as a co-portfolio manager for the equity
portion of the ASSET ALLOCATION PORTFOLIO since February 1, 1995. Mr. Gutfleish
is a Vice President of GSAM, which he joined in 1993. Prior to 1993, he was a
principal of Sanford C. Bernstein & Co., Inc. in its Investment Management
Research Department.

Theodore T. Sotir has served as co-portfolio manager for the fixed-income
portion of the ASSET ALLOCATION PORTFOLIO since its inception date of July 1,
1993. Mr. Sotir is a Vice President of GSAM, where he joined the Funds Group in
1993 after working as a portfolio manager at Fidelity Management Trust Company.

Jonathan A. Beinner has served as co-portfolio manager for the fixed-income
portion of the ASSET ALLOCATION PORTFOLIO since its inception date of July 1,
1993. Mr. Beinner is a Vice President of GSAM, where he joined the Funds Group
in 1990.

Richard C. Lucy has served as co-portfolio manager for the fixed-income
portion of the ASSET ALLOCATION PORTFOLIO since its inception date of July 1,
1993. Mr. Lucy is a Vice President of GSAM, where he joined the Funds Group in
1992 after spending nine years managing fixed-income assets at Brown Brothers
Harriman & Co.

Michael R. Baldwin and Bruce W. Calvert have served as co-portfolio
managers for the GROWTH-INCOME PORTFOLIO since the inception date of February 9,
1993. Mr. Baldwin is a Vice President of Alliance Capital Management and joined
the company in 1989 after completing an S.M. in Management at the Massachusetts
Institute of Technology and a subsequent year as a research associate at the
Harvard Business School. Mr. Calvert is Vice Chairman and Chief Investment
Officer, and joined Alliance Capital Management in 1973.

Stephen W. Pelensky has served as a co-portfolio manager for the
GROWTH-INCOME PORTFOLIO since June 30, 1995. Mr. Pelensky is a Vice President of
Alliance Capital Management and joined the company in 1994. Prior to joining
Alliance Capital Management, Mr. Pelensky was a portfolio manager and analyst
with Affinity Investments Advisors and BEA Associates.

James G. Reilly has served as the portfolio manager for the ALLIANCE GROWTH
PORTFOLIO since the inception date of February 9, 1993. Mr. Reilly is a Senior
Vice President of Alliance Capital Management and joined the company in 1984.

John T. Wilson has served as the portfolio manager of the GROWTH/PHOENIX
INVESTMENT COUNSEL PORTFOLIO since January 1995. Mr. Wilson, is Vice President,
Phoenix Investment Counsel, Inc., and also serves as portfolio manager, Common
Stock, Phoenix Home Life Mutual Insurance Company (Phoenix Home Life); Vice
President, Phoenix Series Fund and Vice President, National Securities &
Research Corporation. Mr. Wilson has held various positions with Phoenix Home
Life since 1990.

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Jeffrey Miller has served as a portfolio manager for the PROVIDENT GROWTH
PORTFOLIO since the inception date of February 9, 1993. Mr. Miller is a Managing
Director of Provident Investment Counsel and has been with the company since
1972.

George Handtmann has served as a portfolio manager for the PROVIDENT GROWTH
PORTFOLIO since the inception date of February 9, 1993. Mr. Handtmann is a
Managing Director of Provident Investment Counsel and has been with the company
since 1981.

Michael Powers has served as a portfolio manager for the PROVIDENT GROWTH
PORTFOLIO since the inception date of February 9, 1993. Mr. Powers is a Senior
Vice President with Provident Investment Counsel and has been with the company
since 1989.

Peter R. Anderson serves as co-portfolio manager of the FEDERATED VALUE
PORTFOLIO. Mr. Anderson joined Federated Investors in 1972 as, and is presently,
a Senior Vice President of Federated Advisers. Mr. Anderson is a Chartered
Financial Analyst.

Timothy E. Keefe serves as co-portfolio manager of the FEDERATED VALUE
PORTFOLIO. Mr. Keefe joined Federated Investors in 1987, and has been a Vice
President of Federated Advisers since 1995. Mr. Keefe is a Chartered Financial
Analyst.

Shelby M.C. Davis has served as a portfolio manager of the VENTURE VALUE
PORTFOLIO since the inception date of October 28, 1994. Since 1968, Mr. Davis
has been a director of Venture Advisers, Inc. and, as of May 1, 1994, its
controlling stockholder.

Christopher C. Davis has served as a portfolio manager of the VENTURE VALUE
PORTFOLIO since October 1, 1995. Mr. Davis has been employed by Davis Selected
Advisers, L.P. since September, 1989 as an assistant portfolio manager and
research analyst.

Audrey L. Snell serves as the portfolio manager for the AGGRESSIVE GROWTH
PORTFOLIO. Ms. Snell is a Senior Vice President of SAAMCo and has been a
portfolio manager with the firm since 1991.

Kelly A. Morgan has served as the portfolio manager for the GLOBAL EQUITIES
PORTFOLIO since the inception date of February 9, 1993. Ms. Morgan is a Vice
President of Alliance Capital Management and joined the company in 1988.

Barton Biggs has served as a co-portfolio manager for the INTERNATIONAL
DIVERSIFIED EQUITIES PORTFOLIO since the inception date of October 28, 1994. Mr.
Biggs is Chairman and Chief Investment Officer of Morgan Stanley Asset
Management Inc. and a Director of Morgan Stanley Group, Inc. He joined Morgan
Stanley in 1973 as a General Partner and Managing Director and is a member of
Morgan Stanley Group, Inc.'s Board of Directors and of the Management Committee.

Francine Bovich and Ann Thivierge have served as co-portfolio managers for
the INTERNATIONAL DIVERSIFIED EQUITIES PORTFOLIO since July 1, 1995. Ms. Bovich
is responsible for product development, portfolio management and communication
of asset allocation strategy. She joined Morgan Stanley Asset Management Inc. as
a Principal in 1993. Ms. Thivierge is a Vice President of Morgan Stanley Asset
Management Inc. and has been with the company since 1986.

CUSTODIAN, TRANSFER AGENT AND DIVIDEND PAYING AGENT -- State Street Bank
and Trust Company ("State Street"), 225 Franklin Street, Boston, Massachusetts
02110, is the Trust's custodian, transfer agent and dividend paying agent. State
Street maintains custody of the Trust's securities and cash and the records of
each shareholder's account. State Street also performs other related shareholder
service functions.

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PORTFOLIO TURNOVER AND BROKERAGE

All Portfolios effect portfolio transactions without regard to the length
of time particular investments have been held. Under certain market conditions,
the investment policies of the Portfolios may result in high portfolio turnover.
The portfolio turnover rates for the Portfolios are contained in the section
entitled "Financial Highlights." High portfolio turnover involves
correspondingly greater brokerage commissions, to the extent such commissions
are payable, and other transaction costs that are borne directly by the
Portfolio involved. Higher turnover rates reflect an increased rate of
realization of gains and losses by the Portfolio, which would normally affect
the taxable income of the Portfolio's shareholders. Where the shareholder is an
insurance company separate account funding variable annuity contracts, qualified
as such under the Internal Revenue Code of 1986, as amended ("Code"); however,
the contractowners are not currently charged with such income or losses except
to the extent provided under the Code (normally when distributions under the
contracts are made). Corporate bonds and U.S. government securities are
generally traded on a net basis and usually neither brokerage commissions nor
transfer taxes are involved.

Broker-dealers involved in the execution of portfolio transactions on
behalf of the Trust are selected on the basis of their professional capability
and the value and quality of their services. In selecting such broker-dealers,
the Adviser and Subadvisers will consider various relevant factors, including,
but not limited to, the size and type of the transaction; the nature and
character of the markets in which the security can be purchased or sold; the
execution efficiency, settlement capability, and financial condition of the
broker-dealer; the broker-dealer's execution services rendered on a continuing
basis; and the reasonableness of any commissions. The Adviser or a Subadviser
also may select broker-dealers which provide it with research services and may
cause a Portfolio to pay such broker-dealers commissions which exceed those
which other broker-dealers may have charged, if in the Adviser's or Subadviser's
view the commissions are reasonable in relation to the value of the brokerage
and/or research services provided by the broker-dealer. Further, the Adviser or
a Subadviser may effect portfolio transactions through broker-dealer affiliates
of the Trust, Adviser or Subadvisers.

DIVIDENDS, DISTRIBUTIONS AND FEDERAL TAXES

Under the Code each Portfolio is treated as a separate regulated investment
company providing qualification requirements are met. To qualify as a regulated
investment company, a Portfolio must, among other things, (a) derive at least
90% of its gross income from dividends, interest, payments with respect to
securities loans, gains from the sale or other disposition of stocks, securities
or foreign currencies, or other income (including but not limited to gains from
options, futures or forward contracts) derived with respect to its business of
investing in such stocks, securities or currencies; (b) derive less than 30% of
its gross income from the sale or other disposition of stocks or securities or
certain foreign currencies (or options, futures or forward contracts thereon)
held less than three months ("short-short gains"); provided, however, that
foreign currency gains, including those derived from options, futures and
forward contracts, will not, in any event, be characterized as short-short gains
if they are directly related to the registered investment company's investments
in stocks, options or futures thereon; and (c) diversify its holdings so that,
at the end of each fiscal quarter, (i) at least 50% of the market value of the
Portfolio's assets is represented by cash, U.S. government securities and other
securities limited in respect of any one issuer to 5% of the Portfolio's assets
and to not more than 10% of the voting securities of such issuer, and (ii) not
more than 25% of the value of its assets is invested in the securities of any
one issuer (other than U.S. government securities). Each Portfolio is intended
to meet these qualification requirements.

So long as a Portfolio qualifies as a regulated investment company, such
Portfolio will not be subject to federal income tax on the net investment
company taxable income or net capital gains distributed to shareholders as
ordinary income dividend or capital gains dividends. It is the policy of each
Portfolio to distribute to its shareholders substantially all of its ordinary
income and net long-term capital gains realized during each fiscal year. All
distributions are reinvested in shares of the Portfolio at net asset value
unless the transfer agent is instructed otherwise.

Each Portfolio of the Trust is also subject to variable contract asset
diversification regulations prescribed by the U.S. Treasury Department under the
Code. These regulations generally provide that, as of the end of each calendar
quarter or within 30 days thereafter, no more than 55% of the total assets of
the Portfolio may be represented by any one investment, no more than 70% by any
two investments, no more than 80% by any three investments, and no more than 90%
by any four investments. For this purpose, all securities of the same issuer are
considered a single investment, but each U.S. agency or instrumentality is
treated as a separate issuer. If a Portfolio fails to comply with

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these regulations, the contracts invested in that Portfolio will not be treated
as annuity, endowment or life insurance contracts for tax purposes.

See the applicable contract prospectus for information regarding the
federal income tax treatment of the contracts and distributions to the separate
accounts.

PRICE OF SHARES

Shares of each Portfolio of the Trust are sold at the net asset value per
share calculated once daily at the close of regular trading (currently 4:00
p.m., New York time) on each day the New York Stock Exchange is open. The
current value of the Portfolio's total assets, less liabilities, is divided by
the total number of shares outstanding, and the result is the net asset value
per share. Assets are generally valued at their market value, where available,
except that short-term securities with 60 days or less to maturity are valued on
an amortized cost basis. For a complete description of the procedures involved
in valuing various Trust assets, see the Statement of Additional Information.

PURCHASES AND REDEMPTIONS

Shares of the Trust currently are offered only to the Variable Separate
Account and FS Variable Separate Account, separate accounts of Anchor National
Life Insurance Company and First SunAmerica Life Insurance Company,
respectively. At present, Trust shares are used as the investment vehicle for
annuity contracts only. The Life Companies may issue variable life contracts
that also will use the Trust as the underlying investment. The offering of Trust
shares to variable annuity and variable life separate accounts is referred to as
"mixed funding." It may be disadvantageous for variable annuity separate
accounts and variable life separate accounts to invest in the Trust
simultaneously. Although neither the Life Companies nor the Trust currently
foresees such disadvantages either to variable annuity or variable life contract
owners, the Board of Trustees of the Trust, based upon information provided by
the Life Companies, would monitor events in order to determine, should a
material conflict arise, what action, if any, need be taken in response thereto.
Shares of the Trust may be offered to separate accounts of other life insurance
companies which are affiliates of the Life Companies.

All shares may be purchased or redeemed by the separate accounts without
any sales or redemption charge at the next computed net asset value. Purchases
and redemptions are made subsequent to corresponding purchases and redemptions
of units of the separate accounts without delay.

Except in extraordinary circumstances and as permissible under the 1940
Act, the redemption proceeds are paid on or before the seventh day following the
request for redemption.

SHAREHOLDER VOTING RIGHTS

All shares of the Trust have equal voting rights and may be voted in the
election of trustees and on other matters submitted to the vote of the
shareholders. Shareholders' meetings ordinarily will not be held unless required
by the 1940 Act. As permitted by Massachusetts law, there normally will be no
shareholders' meetings for the purpose of electing trustees unless and until
such time as fewer than a majority of the trustees holding office have been
elected by shareholders. At that time, the trustees then in office will call a
shareholders' meeting for the election of trustees. The trustees must call a
meeting of shareholders for the purpose of voting upon the removal of any
trustee when requested to do so by the record holders of 10% or more of the
outstanding shares of the Trust. A trustee may be removed after the holders of
record of not less than two-thirds of the outstanding shares have declared that
the trustee be removed either by declaration in writing or by votes cast in
person or by proxy. Except as set forth above, the trustees shall continue to
hold office and may appoint successor trustees, provided that immediately after
the appointment of any successor trustee, at least two-thirds of the trustees
have been elected by the shareholders. Shares do not have cumulative voting
rights. Thus, holders of a majority of the shares voting for the election of
trustees can elect all the trustees. No amendment may be made to the Declaration
of Trust without the affirmative vote of a majority of the outstanding shares of
the Trust, except that amendments to conform the Declaration to the requirements
of applicable federal laws or regulations or the regulated investment company
provisions of the Code may be made by the trustees without the vote or consent
of shareholders. If not terminated by the vote or written consent of a majority
of its outstanding shares, the Trust will continue indefinitely.

A change in the fundamental investment restrictions of a Portfolio requires
the vote of a "majority of the outstanding voting securities" of that Portfolio.
This term is defined in the 1940 Act and explained in the Statement of
Additional Information.

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In matters affecting only a particular Portfolio, the matter shall have
been effectively acted upon by a vote of that Portfolio even though: (1) the
matter has not been approved by a vote of any other Portfolio; or (2) the matter
has not been approved by a vote of the Trust as a whole.

Shareholders of a Massachusetts business trust may, under certain
circumstances, be held personally liable as partners for the obligations of the
Trust. The risk of a shareholder incurring any financial loss on account of
shareholder liability is limited to circumstances in which the Trust itself
would be unable to meet its obligations. The Declaration of Trust contains an
express disclaimer of shareholder liability for acts or obligations of the Trust
and provides that notice of the disclaimer must be given in each agreement,
obligation or instrument entered into or executed by the Trust or Trustees. The
Declaration of Trust provides for indemnification of any shareholder held
personally liable for the obligations of the Trust and also provides for the
Trust to reimburse the shareholder for all legal and other expenses reasonably
incurred in connection with any such claim or liability.

INDEPENDENT ACCOUNTANTS

Price Waterhouse LLP has been selected as independent accountants for the
Trust.

SHAREHOLDER INQUIRIES

Shareholder inquiries should be directed to Anchor National Life Insurance
Company or First SunAmerica Life Insurance Company, Service Center, P.O. Box
54299, Los Angeles, California 90054-0299, telephone number (800) 445-7862. In
New York, shareholders should call (800) 99-NYSUN.

FINANCIAL INFORMATION

Further financial information can be found in the Statement of Additional
Information, which is available upon written request to the Trust.

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Statement of Additional Information

SUNAMERICA SERIES TRUST

This Statement of Additional Information is not a prospectus, but
should be read in conjunction with the current Prospectus of
SunAmerica Series Trust ("Trust"). Capitalized terms used herein
but not defined have the meanings assigned to them in the
Prospectus. The Prospectus may be obtained by writing to the
Trust at the following address:

P.O. Box 54299
Los Angeles, California 90054-0299

June ___, 1996

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TABLE OF CONTENTS

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TOPIC PAGE
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<S> <C>
The Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-2
Investment Objectives and Policies . . . . . . . . . . . . . . . . . B-3
Description of Commercial Paper and Bond Ratings . . . . . . . . . . B-18
Investment Restrictions . . . . . . . . . . . . . . . . . . . . . . B-22
Trust Officers and Trustees . . . . . . . . . . . . . . . . . . . . B-27
Investment Advisory and Management Agreement . . . . . . . . . . . . B-29
Subadvisory Agreements . . . . . . . . . . . . . . . . . . . . . . . B-32
Dividends, Distributions and Federal Taxes . . . . . . . . . . . . . B-35
Price of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . B-35
Execution of Portfolio Transactions . . . . . . . . . . . . . . . . B-36
General Information . . . . . . . . . . . . . . . . . . . . . . . . B-41
Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . B-43
</TABLE>

THE TRUST

The Trust, organized as a Massachusetts business trust on September
11, 1992, is an open-end management investment company. Shares of the Trust
are issued and redeemed only in connection with investments in and payments
under variable annuity contracts, and may be sold to fund variable life
contracts in the future.

On August 30, 1994, the Board of Trustees of the Trust (the
"Trustees") approved the creation of the Balanced/Phoenix Investment Counsel
Portfolio, International Diversified Equities Portfolio, Worldwide High Income
Portfolio and Venture Value Portfolio. On March 1, 1996, the Trustees approved
the creation of the SunAmerica Balanced Portfolio, Aggressive Growth Portfolio,
Federated Value Portfolio and Utility Portfolio. In addition, on March 1,
1996, the Trustees approved changing the name of the Fixed Income Portfolio to
the Corporate Bond Portfolio, and such name change became effective on June 3,
1996. Prior to June 3, 1996, Goldman Sachs Asset Management, a separate
operating division of Goldman, Sachs & Co., served as subadviser for the
Corporate Bond Portfolio (formerly, the Fixed Income Portfolio).

Shares of the Trust are held by Variable Separate Account and FS
Variable Separate Account, separate accounts of, respectively, Anchor National
Life Insurance Company, an Arizona corporation, and First SunAmerica Life
Insurance Company, a New York corporation. Anchor National Life Insurance
Company and First SunAmerica Life Insurance Company are wholly owned
subsidiaries of SunAmerica Life Insurance Company, an Arizona corporation
wholly owned by SunAmerica Inc., a Maryland corporation.

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<PAGE> 45
INVESTMENT OBJECTIVES AND POLICIES

The discussion below is intended to supplement the information contained in the
Prospectus.

CASH MANAGEMENT PORTFOLIO. The Cash Management Portfolio seeks to
achieve its investment objective by investing in a diversified selection of
money market instruments. The money market instruments that the Portfolio may
invest in are as follows:

Commercial Bank Obligations - Certificates of deposit
(interest-bearing time deposits), bankers' acceptances (time drafts
drawn on a commercial bank where the bank accepts an irrevocable
obligation to pay at maturity) and documented discount notes
(corporate promissory discount notes accompanied by a commercial bank
guarantee to pay at maturity) representing direct or contingent
obligations of commercial banks with total assets in excess of $1
billion, based on the latest published reports. The Cash Management
Portfolio may also invest in obligations issued by commercial banks
with total assets of less than $1 billion if the principal amount of
these obligations owned by the Cash Management Portfolio is fully
insured by the Federal Deposit Insurance Corporation ("FDIC").

Savings Association Obligations - Certificates of deposit
(interest-bearing time deposits) issued by mutual savings banks or
savings and loan associations with assets in excess of $1 billion and
whose deposits are insured by the FDIC. The Cash Management Portfolio
may also invest in obligations issued by mutual savings banks or
savings and loan associations with total assets of less than $1
billion if the principal amount of these obligations owned by the Cash
Management Portfolio is fully insured by the FDIC.

Commercial Paper - Short-term notes (up to 9 months) issued by
corporations or governmental bodies. The Cash Management Portfolio
may only purchase commercial paper judged by SunAmerica Asset
Management Corp. ("SAAMCo" or the "Adviser") to be of suitable
investment quality. This includes commercial paper that is (a) rated
in the two highest categories by Standard & Poor's Ratings Services, a
Division of The McGraw-Hill Companies, Inc. ("Standard & Poor's") and
by Moody's Investors Service, Inc. ("Moody's"), or (b) other
commercial paper deemed on the basis of the issuer's creditworthiness
to be of a quality appropriate for the Cash Management Portfolio. (No
more than 5% of the Cash Management Portfolio's assets may be invested
in commercial paper in the second highest rating category; no more
than the greater of 1%

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<PAGE> 46
or $1 million may be invested in such securities of any one issuer.)
See "Description of Commercial Paper and Bond Ratings" for a
description of the ratings. The Cash Management Portfolio will not
purchase commercial paper described in (b) above if such paper would
in the aggregate exceed 15% of its total assets after such purchase.
The commercial paper in which the Cash Management Portfolio may invest
includes variable amount master demand notes. Variable amount master
demand notes permit the Cash Management Portfolio to invest varying
amounts at fluctuating rates of interest pursuant to the agreement in
the master note. These are direct lending obligations between the
lender and borrower, they are generally not traded, and there is no
secondary market. Such instruments are payable with accrued interest
in whole or in part on demand. The amounts of the instruments are
subject to daily fluctuations as the participants increase or decrease
the extent of their participation. Investments in these instruments
are limited to those that have a demand feature enabling the Cash
Management Portfolio unconditionally to receive the amount invested
from the issuer upon seven or fewer days' notice. Generally, the Cash
Management Portfolio attempts to invest in instruments having a
one-day notice provision. In connection with master demand note
arrangements, the Adviser, subject to the direction of the trustees,
monitors on an ongoing basis, the earning power, cash flow and other
liquidity ratios of the borrower, and its ability to pay principal and
interest on demand. The Adviser also considers the extent to which
the variable amount master demand notes are backed by bank letters of
credit. These notes generally are not rated by Moody's or Standard &
Poor's and the Cash Management Portfolio may invest in them only if it
is determined that at the time of investment the notes are of
comparable quality to the other commercial paper in which the
Portfolio may invest. Master demand notes are considered to have a
maturity equal to the repayment notice period unless the Adviser has
reason to believe that the borrower could not make timely repayment
upon demand.

Corporate Bonds and Notes - The Cash Management Portfolio may
purchase corporate obligations that mature or that may be redeemed in
one year or less. These obligations originally may have been issued
with maturities in excess of one year. The Cash Management Portfolio
may invest only in corporate bonds or notes of issuers having
outstanding short-term securities rated in the top two rating
categories by Standard & Poor's and Moody's. See "Description of
Commercial Paper and Bond

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<PAGE> 47
Ratings" for description of investment-grade ratings by Standard &
Poor's and Moody's.

WORLDWIDE HIGH INCOME PORTFOLIO. The following is additional
disclosure relating to the Portfolio's investments:

Loan Participations and Assignments. The Worldwide High Income
Portfolio may invest in fixed and floating rate loans ("Loans")
arranged through private negotiations between an issuer of sovereign
or corporate debt obligations and one or more financial institutions
("Lenders"). The Portfolio's investments in Loans are expected in
most instances to be in the form of participations in Loans
("Participations") and assignments of all or a portion of Loans
("Assignments") from third parties. In the case of Participations,
the Portfolio will have the right to receive payments of principal,
interest and any fees to which it is entitled only from the Lender
selling the Participation and only upon receipt by the Lender of the
payments from the borrower. In the event of the insolvency of the
Lender selling a Participation, the Portfolio may be treated as a
general creditor of the Lender and may not benefit from any set-off
between the Lender and the borrower. The Portfolio will acquire
Participations only if the Lender interpositioned between the
Portfolio and the borrower is determined by the Subadviser to be
creditworthy. When the Portfolio purchases Assignments from Lenders
it will acquire direct rights against the borrower on the Loan.
Because Assignments are arranged through private negotiations between
potential assignees and potential assignors, however, the rights and
obligations acquired by the Portfolio as the purchaser of an
Assignment may differ from, and be more limited than, those held by
the assigning Lender. Because there is no liquid market for such
securities, the Portfolio anticipates that such securities could be
sold only to a limited number of institutional investors. The lack of
a liquid secondary market may have an adverse impact on the value of
such securities and the Portfolio's ability to dispose of particular
Assignments or Participations when necessary to meet the Portfolio's
liquidity needs or in response to a specific economic event such as a
deterioration in the creditworthiness of the borrower. The lack of a
liquid secondary market for Assignments and Participations also may
make it more difficult for the Portfolio to assign a value to these
securities for purposes of valuing the Portfolio and calculating its
net asset value.

Structured Investments. The Worldwide High Income Portfolio may
invest a portion of its assets in entities organized and operated
solely for the purpose of

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<PAGE> 48
restructuring the investment characteristics of sovereign debt
obligations. This type of restructuring involves the deposit with or
purchase by an entity, such as a corporation or trust, of specified
instruments (such as commercial bank loans or Brady Bonds) and the
issuance by that entity of one or more classes of securities
("Structured Securities") backed by, or representing interests in, the
underlying instruments. The cash flow on the underlying instruments
may be apportioned among the newly issued Structured Securities to
create securities with different investment characteristics, such as
varying maturities, payment priorities and interest rate provisions,
and the extent of the payments made with respect to Structured
Securities is dependent on the extent of the cash flow on the
underlying instruments. Because Structured Securities of the type in
which the Portfolio anticipates it will invest typically involve no
credit enhancement, their credit risk generally will be equivalent to
that of the underlying instruments. The Portfolio is permitted to
invest in a class of Structured Securities that is either subordinated
or unsubordinated to the right of payment of another class.
Subordinated Structured Securities typically have higher yields and
present greater risks than unsubordinated Structured Securities.
Structured Securities are typically sold in private placement
transactions, and there currently is no active trading market for
Structured Securities.

The Portfolio's investments in government and government-related and
restructured debt instruments are subject to special risks, including
the inability or unwillingness to repay principal and interest,
requests to reschedule or restructure outstanding debt and requests to
extend additional loan amounts.

Short Sales. Each Portfolio may make "short sales against the box."
A short sale is effected by selling a security which the Portfolio
does not own. A short sale is against the box to the extent that the
Portfolio contemporaneously owns, or has the right to obtain without
payment, securities identical to those sold short. A Portfolio may
not enter into a short sale against the box, if, as a result, more
than 25% of its total assets would be subject to such short sales.

ILLIQUID SECURITIES. Each of the Portfolios may invest no more than
15% (10% in the case of the Cash Management Portfolio) of its net assets,
determined as of the date of purchase, in illiquid securities including
repurchase agreements which have a maturity of longer than seven days or in
other securities that are illiquid by virtue of the absence of a readily
available market or legal or

B-6
<PAGE> 49
contractual restrictions on resale. Historically, illiquid securities have
included securities subject to contractual or legal restrictions on resale
because they have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), securities which are otherwise not readily
marketable and repurchase agreements having a maturity of longer than seven
days. Repurchase agreements subject to demand are deemed to have a maturity
equal to the notice period. Securities which have not been registered under
the Securities Act are referred to as private placements or restricted
securities and are purchased directly from the issuer or in the secondary
market. Mutual funds do not typically hold a significant amount of these
restricted or other illiquid securities because of the potential for delays on
resale and uncertainty in valuation. Limitations on resale may have an adverse
effect on the marketability of portfolio securities and a mutual fund might be
unable to dispose of restricted or other illiquid securities promptly or at
reasonable prices and might thereby experience difficulty satisfying
redemptions within seven days. A mutual fund might also have to register such
restricted securities in order to dispose of them, resulting in additional
expense and delay. There generally will be a lapse of time between a mutual
fund's decision to sell an unregistered security and the registration of such
security promoting sale. Adverse market conditions could impede a public
offering of such securities. When purchasing unregistered securities, the
Portfolios will seek to obtain the right of registration at the expense of the
issuer.

In recent years, a large institutional market has developed for
certain securities that are not registered under the Securities Act, including
repurchase agreements, commercial paper, foreign securities, municipal
securities and corporate bonds and notes. Institutional investors depend on an
efficient institutional market in which the unregistered security can be
readily resold or on an issuer's ability to honor a demand for repayment. The
fact that there are contractual or legal restrictions on resale to the general
public or to certain institutions may not be indicative of the liquidity of
such investments.

Restricted securities eligible for resale pursuant to Rule 144A under
the Securities Act for which there is a readily available market will not be
deemed to be illiquid. The Adviser or subadviser, as the case may be, will
monitor the liquidity of such restricted securities subject to the supervision
of the Board of Trustees of the Trust. In reaching liquidity decisions, the
Adviser, or subadviser, as the case may be, will consider, inter alia, pursuant
to guidelines and procedures established by the Trustees, the following
factors: (1) the frequency of trades and quotes for the security; (2) the
number of dealers wishing to purchase or sell the security and the number of
other potential purchasers; (3) dealer undertakings to make a market in the
security; and (4) the nature of the security and the nature of the marketplace
trades (e.g., the time needed to dispose of the

B-7
<PAGE> 50
security, the method of soliciting offers and the mechanics of the transfer).

The Cash Management Portfolio may invest in commercial paper issues
which include securities issued by major corporations without registration
under the Securities Act in reliance on the exemption from such registration
afforded by Section 3(a)(3) thereof, and commercial paper issued in reliance on
the so-called private placement exemption from registration which is afforded
by Section 4(2) of the Securities Act ("Section 4(2) paper"). Section 4(2)
paper is restricted as to disposition under the federal securities laws in that
any resale must similarly be made in an exempt transaction. Section 4(2) paper
is normally resold to other institutional investors through or with the
assistance of investment dealers who make a market in Section 4(2) paper, thus
providing liquidity. Section 4(2) paper that is issued by a company that files
reports under the Securities Exchange Act of 1934 is generally eligible to be
sold in reliance on the safe harbor of Rule 144A described above. The Cash
Management Portfolio's 10% limitation on investments in illiquid securities
includes Section 4(2) paper other than Section 4(2) paper that the Adviser has
determined to be liquid pursuant to guidelines established by the Trustees.
The Portfolio's Board of Trustees delegated to the Adviser the function of
making day-to-day determinations of liquidity with respect to Section 4(2)
paper, pursuant to guidelines approved by the Trustees that require the Adviser
to take into account the same factors described above for other restricted
securities and require the Adviser to perform the same monitoring and reporting
functions.

REVERSE REPURCHASE AGREEMENTS. The Cash Management, Corporate Bond,
High-Yield Bond, Worldwide High Income, SunAmerica Balanced, Aggressive Growth,
Federated Value and Utility Portfolios may enter into reverse repurchase
agreements with brokers, dealers, domestic and foreign banks or other financial
institutions that have been determined by the Adviser or Subadviser to be
creditworthy. In a reverse repurchase agreement, the Portfolio sells a
security and agrees to repurchase it at a mutually agreed upon date and price,
reflecting the interest rate effective for the term of the agreement. It may
also be viewed as the borrowing of money by the Portfolio. The Portfolio's
investment of the proceeds of a reverse repurchase agreement is the speculative
factor known as leverage. The Portfolios will enter into a reverse repurchase
agreement only if the interest income from investment of the proceeds is
expected to be greater than the interest expense of the transaction and the
proceeds are invested for a period no longer than the term of the agreement.
The Portfolio will maintain with the Custodian a separate account with a
segregated portfolio of cash, U.S. government securities or other liquid high
grade debt obligations in an amount at least equal to its purchase obligations
under these agreements (including accrued interest). In the event that the
buyer of securities under a reverse repurchase agreement files for

B-8
<PAGE> 51

bankruptcy or becomes insolvent, the buyer or its trustee or receiver may
receive an extension of time to determine whether to enforce the Portfolio's
repurchase obligation, and the Portfolio's use of proceeds of the agreement may
effectively be restricted pending such decision. Reverse repurchase agreements
are considered to be borrowings and are subject to the percentage limitations
on borrowings. See "Investment Restrictions."

FLOATING RATE OBLIGATIONS. These securities have a coupon rate that
changes at least annually and generally more frequently. The coupon rate is
set in relation to money market rates. The obligations, issued primarily by
banks, other corporations, governments and semi-governmental bodies, may have a
maturity in excess of one year. In some cases, the coupon rate may vary with
changes in the yield on Treasury bills or notes or with changes in LIBOR
(London Interbank Offering Rate). The Adviser considers floating rate
obligations to be liquid investments because a number of United States and
foreign securities dealers make active markets in these securities.

COVERED OPTIONS. Each Portfolio may write (sell) covered call and
put options on any securities in which it may invest. A Portfolio may purchase
and write such options on securities that are listed on national domestic
securities exchanges (and, for certain Portfolios, foreign securities
exchanges) or traded in the over-the-counter market. A call option written by
a Portfolio obligates a Portfolio to sell specified securities to the holder of
the option at a specified price if the option is exercised at any time before
the expiration date. All call options written by a Portfolio are covered,
which means that a Portfolio will own the securities subject to the option so
long as the option is outstanding. The purpose of writing covered call options
is to realize greater income than would be realized on portfolio securities
transactions alone. However, in writing covered call options for additional
income, a Portfolio may forego the opportunity to profit from an increase in
the market price of the underlying security.

A put option written by a Portfolio would obligate a Portfolio to
purchase specified securities from the option holder at a specified price if
the option is exercised at any time before the expiration date. All put
options written by a Portfolio would be covered, which means that the Portfolio
would have deposited with its custodian cash, U.S. government securities or
other high-grade debt securities (i.e., securities rated in one of the top
three categories by Moody's or Standard & Poor's, or, if unrated, deemed by the
Adviser or subadviser to be of comparable credit quality) with a value at least
equal to the exercise price of the put option. The purpose of writing such
options is to generate additional income for a Portfolio. However, in return
for the option premium, a Portfolio accepts the risk that it may be

B-9
<PAGE> 52
required to purchase the underlying securities at a price in excess of the
securities' market value at the time of purchase.

PORTFOLIO STRATEGIES RELATED TO FOREIGN SECURITIES. Each Portfolio may
engage in various portfolio strategies to reduce certain risks of their
respective investments and/or to attempt to enhance return. Each Portfolio may
engage in strategies including the purchase and sale of forward foreign
currency exchange contracts, currency and financial index futures contracts
(including, in the case of the Global Equities Portfolio, stock index futures)
and options thereon, put and call options on currencies and financial indices,
and combinations thereof. The Adviser or Subadviser will use such techniques
as market conditions warrant. Each Portfolio's ability to use these strategies
may be limited by market conditions, regulatory limits and tax considerations
and there can be no assurance that any of these strategies will succeed. New
financial products and risk management techniques continue to be developed and
these Portfolios may use these new investments and techniques to the extent
consistent with their investment objective and policies.

In addition to direct investment, the Portfolios which may invest in
foreign securities may also invest in American Depositary Receipts ("ADRs") and
in other Depositary Receipts, including Global Depositary Receipts ("GDRs"),
European Depositary Receipts ("EDRs") and others (which, together with ADRs,
GDRs and EDRs, are hereinafter collectively referred to as "Depositary
Receipts"), to the extent that such Depositary Receipts become available. ADRs
are securities, typically issued by a U.S. financial institution (a
"depositary"), that evidence ownership interests in a security or a pool of
securities issued by a foreign issuer (the "underlying issuer") and deposited
with the depositary. ADRs include American Depositary Shares and New York
Shares and may be "sponsored" or "unsponsored." Sponsored ADRs are established
jointly by a depositary and the underlying issuer, whereas unsponsored ADRs may
be established by a depositary without participation by the underlying issuer.
GDRs, EDRs and other types of Depositary Receipts are typically issued by
foreign depositaries, although they may also be issued by U.S. depositaries,
and evidence ownership interests in a security or pool of securities issued by
either a foreign or a U.S. corporation. Holders of unsponsored Depositary
Receipts generally bear all the costs associated with establishing the
unsponsored Depositary Receipt. The depositary of unsponsored Depositary
Receipts is under no obligation to distribute shareholder communications
received from the underlying issuer or to pass through to the holders of the
unsponsored Depositary Receipt voting rights with respect to the deposited
securities or pool of securities. Depositary Receipts are not necessarily
denominated in the same currency as the underlying securities to which they may
be connected. Generally, Depositary Receipts in registered form are designed
for use in the U.S. securities market and Depositary Receipts in bearer form
are

B-10
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designed for use in securities markets outside the United States. A Portfolio
may invest in sponsored and unsponsored Depositary Receipts. For purposes of a
Portfolio's investment policies, the Portfolio's investments in Depositary
Receipts will be deemed to be investments in the underlying securities. The
Portfolios also may invest in securities denominated in European Currency Units
("ECUs"). Generally ADRs, in registered form, are dollar denominated securities
designed for use in the U.S. securities markets, which represent and may be
converted into the underlying foreign security. EDRs, in bearer form, are
designed for use in the European securities markets. An "ECU" is a "basket"
consisting of specified amounts of currencies of certain of the twelve member
states of the European Community. The specific amount of currencies comprising
the ECU may be adjusted by the Council of Ministers of the European Community
from time to time to reflect changes in relative values of the underlying
currencies. In addition, the Portfolios may invest in securities denominated
in other currency "baskets."

FOREIGN CURRENCY AND FINANCIAL INDEX TRANSACTIONS - FORWARD EXCHANGE
AND FUTURES CONTRACTS, OPTIONS AND OPTIONS ON FUTURES CONTRACTS. Each
Portfolio may enter into contracts for the purchase or sale for future delivery
of foreign currencies ("forward currency exchange contracts"), financial and
foreign currency futures contracts or contracts based on financial indices
("futures contracts") and may purchase and write put and call options to buy or
sell currencies and to buy or sell futures contracts ("options on futures
contracts").

A forward foreign currency contract is an obligation to purchase or
sell a currency against another currency at a future date and price as agreed
upon by the parties. A "sale" of a foreign currency futures contract means
entering into a contract to deliver the foreign currencies called for by the
contract at a specified price on a specified date. A "purchase" of a foreign
currency futures contract means entering into a contract to acquire the foreign
currencies called for by the contract at a specified price on a specified date.

An exchange-traded futures contract relating to foreign currency, or a
financial index, is similar to a forward foreign currency exchange contract but
has a standardized size and exchange date. A Portfolio may either accept or
make delivery of the currency at the maturity of such a contract or, prior to
maturity, enter into a closing transaction involving the purchase or sale of an
offsetting contract. The purchaser of a futures contract on an index agrees to
take or make delivery of an amount of cash equal to the difference between a
specified dollar multiple of the value of the index on the expiration date of
the contract and the price at which the contract was originally struck. No
physical delivery of the securities underlying the index is made.

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Over-the-counter currency instruments are subject to the risk that the
counterparty to such instruments will default on its obligations. Since
over-the-counter currency instruments are not guaranteed by an exchange or
clearinghouse, a default on the instrument would deprive the Portfolio of
unrealized profits, transaction costs or the benefits of a currency hedge or
force the Portfolio to cover its purchase or sale commitments, if any, at the
current market price. A Portfolio will not enter into such transactions unless
the credit quality of the unsecured senior debt or the claims-paying ability of
the counterparty is considered to be investment grade by the Adviser or
Subadviser.

Each Portfolio may enter into futures contracts in anticipation of, or
to protect against, fluctuations in currency exchange rates. A Portfolio
might, for example, enter into a futures contract when it wanted to hold
securities denominated in a particular currency but anticipated, and wished to
be protected against, a decline in that currency against the U.S. dollar.
Similarly, it might enter into futures contracts to "lock in" the U.S. dollar
price of non-U.S. dollar denominated securities that it anticipated purchasing.
Although futures contracts typically will involve the purchase and sale of a
foreign currency against the U.S. dollar, a Portfolio also may enter into
currency contracts not involving the U.S. dollar.

In connection with these futures transactions, the Trust has filed a
notice of eligibility with the Commodity Futures Trading Commission ("CFTC")
that exempts the Trust from CFTC registration as a "commodity pool operator" as
defined under the Commodity Exchange Act. Pursuant to this notice, each
Portfolio will observe certain CFTC guidelines with respect to its futures
transactions that, among other things, require the Portfolio to use futures for
bona fide "hedging" purposes only (as defined by CFTC rules), and, in the case
of futures transactions for non-bona fide hedging purposes, to limit initial
margin deposits to no more than 5% of its net assets after taking into account
unrealized profits and unrealized losses on any such contracts entered into.
As evidence of this hedging intent, each of the Global Bond, High-Yield Bond,
Worldwide High Income, Asset Allocation, Venture Value, Global Equities and
International Diversified Equities Portfolios expect that on 75% or more of the
occasions on which it takes a long futures or option position (involving the
purchase of futures contracts), the Portfolio will have purchased, or will be
in the process of purchasing, equivalent amounts of related securities in the
cash market at the time when the futures or option position is closed out.
However, in particular cases, when it is economically advantageous for a
Portfolio to do so, a long futures position may be terminated or an option may
expire without the corresponding purchase of securities or other assets. In
addition, subject to the limitation on margin deposits described above, a
Portfolio may engage in futures transactions for non-bona fide hedging
purposes, provided that the total value of such long futures positions will

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not exceed the sum of (a) cash or cash equivalents set aside in an identifiable
manner for this purpose, (b) cash proceeds on existing investments due within
30 days and (c) accrued profits on such futures or options positions.

Parties to futures contracts and holders and writers of options on
futures can enter into offsetting closing transactions, similar to closing
transactions on options, by selling or purchasing, respectively, an instrument
identical to the instrument held or written. Positions in futures and options
on futures may be closed only on an exchange or board of trade where there
appears to be a liquid secondary market. However, there can be no assurance
that such a market will exist for a particular contract at a particular time.
Secondary markets for options on futures are currently in the development
stage, and no Portfolio will trade options on futures on any exchange or board
of trade unless, in the judgment of the Adviser or applicable Subadviser, the
markets for such options have developed sufficiently that the liquidity risks
for such options are not greater than the corresponding risks for futures.

Under certain circumstances, futures exchanges may establish daily
limits on the amount that the price of a future or related option can vary from
the previous day's settlement price; once that limit is reached, no trades may
be made that day at a price beyond the limit. Daily price limits do not limit
potential losses because prices could move to the daily limit for several
consecutive days with little or no trading, thereby preventing liquidation of
unfavorable positions.

If a Portfolio were unable to liquidate a futures or related options
position due to the absence of a liquid secondary market or the imposition of
price limits, it could incur substantial losses. The Portfolio would continue
to be subject to market risk with respect to its position. In addition, except
in the case of purchased options, the Portfolio would continue to be required
to make daily variation margin payments and might be required to maintain the
position being hedged by the future or option or to maintain cash or securities
in a segregated account.

Certain characteristics of the futures market might increase the risk
that movements in the prices of futures contracts or related options might not
correlate perfectly with movements in the prices of the investments being
hedged. For example, all participants in the futures and related options
markets are subject to daily variation margin calls and might be compelled to
liquidate futures or related option positions whose prices are moving
unfavorably to avoid being subject to further calls. These liquidations could
increase price volatility of the instruments and distort the normal price
relationship between the futures or options and the investments being hedged.
Also, because initial margin deposit requirements in the futures markets are
less onerous

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than margin requirements in the securities markets, there might be increased
participation by speculators in the futures markets. This participation also
might cause temporary price distortions. In addition, activities of large
traders in both the futures and securities markets involving arbitrage,
"program trading" and other investment strategies might result in temporary
price distortions.

In connection with the purchase of futures contracts, a Portfolio will
deposit and maintain in a segregated account with the Trust's custodian an
amount of cash, U.S. government securities or other liquid high grade debt
securities equal to its obligations under the futures contracts less any
amounts maintained in a margin account with the Trust's futures broker.

OPTIONS - Each Portfolio may attempt to accomplish objectives similar
to those involved in their use of futures contracts by purchasing or selling
put or call options on currencies, currency futures contracts, and financial
index futures (including, in the case of the Global Equities Portfolio, stock
index futures). A foreign currency put option gives the Portfolio as purchaser
the right (but not the obligation) to sell a specified amount of currency at
the exercise price until the expiration of the option. A call option gives the
Portfolio as purchaser the right (but not the obligation) to purchase a
specified amount of currency at the exercise price until its expiration. A
Portfolio might purchase a currency put option, for example, to protect itself
during the contract period against a decline in the U.S. dollar value of a
currency in which it holds or anticipates holding securities. If the
currency's value should decline against the U.S. dollar, the loss in currency
value should be offset, in whole or in part, by an increase in the value of the
put. If the value of the currency instead should rise against the U.S. dollar,
any gain to the Portfolio would be reduced by the premium it had paid for the
put option. A currency call option might be purchased, for example, in
anticipation of, or to protect against, a rise in the value against the U.S.
dollar of a currency in which a Portfolio anticipates purchasing securities.

Currency options may be either listed on an exchange or traded
over-the-counter ("OTC options"). Listed options are third-party contracts
(i.e., performance of the obligations of the purchaser and seller is guaranteed
by the exchange or clearing corporation), and have standardized strike prices
and expiration dates. OTC options are two-party contracts with negotiated
strike prices and expiration dates. OTC options differ from exchange-traded
options in that OTC options are transacted with dealers directly and not
through a clearing corporation (which guarantees performance). Consequently,
there is a risk of non-performance by the dealer. Since no exchange is
involved, OTC options are valued on the basis of a quote provided by the
dealer. A Portfolio will not purchase an OTC option unless it is believed that
daily valuations for such options are readily obtainable. In the case of OTC
options, there

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can be no assurance that a liquid secondary market will exist for any
particular option at any specific time.

An option on a securities index is similar to an option on a security
except that, rather than the right to take or make delivery of a security at a
specified price, an option on an index gives the holder the right to receive,
upon exercise of the option, an amount of cash if the closing level of the
chosen index is greater than (in the case of a call) or less than (in the case
of a put) the exercise price of the option.

Options on futures contracts to be written or purchased by a Portfolio
will be traded on U.S. or foreign exchanges or over-the-counter. These
investment techniques will be used only to hedge against anticipated future
changes in market conditions or exchange rates which otherwise might either
adversely affect the value of a Portfolio's securities or adversely affect the
prices of securities which a Portfolio intends to purchase at a later date.

CERTAIN RISK FACTORS RELATING TO HIGH-YIELD BONDS. The Corporate
Bond, High-Yield Bond, Worldwide High Income, Balanced/Phoenix Investment
Counsel and Asset Allocation Portfolios may invest in high-yield bonds. These
bonds present certain risks which are discussed below:

Sensitivity to Interest Rate and Economic Changes - High-yield bonds
are very sensitive to adverse economic changes and corporate
developments. During an economic downturn or substantial period of
rising interest rates, highly leveraged issuers may experience
financial stress that would adversely affect their ability to service
their principal and interest payment obligations, to meet projected
business goals, and to obtain additional financing. If the issuer of
a bond defaulted on its obligations to pay interest or principal or
entered into bankruptcy proceedings, a Portfolio may incur losses or
expenses in seeking recovery of amounts owed to it. In addition,
periods of economic uncertainty and changes can be expected to result
in increased volatility of market prices of high-yield bonds and the
Portfolio's net asset value.

Payment Expectations - High-yield bonds may contain redemption or call
provisions. If an issuer exercised these provisions in a declining
interest rate market, a Portfolio would have to replace the security
with a lower yielding security, resulting in a decreased return for
investors. Conversely, a high-yield bond's value will decrease in a
rising interest rate market,

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as will the value of the Portfolio's assets. If the Portfolio
experiences unexpected net redemptions, this may force it to sell
high-yield bonds without regard to their investment merits, thereby
decreasing the asset base upon which expenses can be spread and
possibly reducing the Portfolio's rate of return.

Liquidity and Valuation - There may be little trading in the secondary
market for particular bonds, which may affect adversely a Portfolio's
ability to value accurately or dispose of such bonds. Adverse
publicity and investor perceptions, whether or not based on
fundamental analysis, may decrease the values and liquidity of
high-yield bonds, especially in a thin market.

CONVENTIONAL MORTGAGE PASS-THROUGH SECURITIES. Conventional mortgage
pass-through securities ("Conventional Mortgage Pass-Throughs") represent
participation interests in pools of mortgage loans that are issued by trusts
formed by originators of the institutional investors in mortgage loans (or
represent custodial arrangements administered by such institutions). These
originators and institutions include commercial banks, savings and loans
associations, credit unions, savings banks, insurance companies, investment
banks or special purpose subsidiaries of the foregoing. For federal income tax
purposes, such trusts are generally treated as grantor trusts or real estate
mortgage conduits ("REMIC") and, in either case, are generally not subject to
any significant amount of federal income tax at the entity level.

The mortgage pools underlying Conventional Mortgage Pass-Throughs
consist of conventional mortgage loans evidenced by promissory notes secured by
first mortgages or first deeds of trust or other similar security instruments
creating a first lien on residential or mixed residential and commercial
properties. Conventional Mortgage Pass-Throughs (whether fixed or adjustable
rate) provide for monthly payments that are a "pass-through" of the monthly
interest and principal payments (including any prepayments) made by the
individual borrowers on the pooled mortgage loans, net of any fees or other
amount paid to any guarantor, administrator and/or servicer of the underlying
mortgage loans. A trust fund with respect to which a REMIC election has been
made may include regular interests in other REMICs which in turn will
ultimately evidence interests in mortgage loans.

Conventional mortgage pools generally offer a higher rate of interest
than government and government-related pools because of the absence of any
direct or indirect government or agency payment guarantees. However, timely
payment of interest and principal of mortgage loans in these pools may be
supported by various forms of insurance or guarantees, including individual
loans, title, pool

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and hazard insurance and letters of credit. The insurance and guarantees may
be issued by private insurers and mortgage poolers. Although the market for
such securities is becoming increasingly liquid, mortgage-related securities
issued by private organizations may not be readily marketable.

CERTAIN COLLATERALIZED MORTGAGE OBLIGATIONS. Principal and interest
on the underlying mortgage assets may be allocated among the several classes of
Collateralized Mortgage Obligations ("CMOs") in various ways. In certain
structures (known as "sequential pay" CMOs), payments of principal, including
any principal prepayments, on the mortgage assets generally are applied to the
classes of CMOs in the order of their respective final distribution dates.
Thus no payment of principal will be made on any class of sequential pay CMOs
until all other classes having an earlier final distribution date have been
paid in full.

Additional structures of CMOs include, among others, "parallel pay"
CMOs. Parallel pay CMOs are those which are structured to apply principal
payments and prepayments of the mortgage assets to two or more classes
concurrently on a proportionate or disproportionate basis. These simultaneous
payments are taken into account in calculating the final distribution date of
each class.

A wide variety of CMOs may be issued in the parallel pay or sequential
pay structures. These securities include accrual certificates (also known as
"Z-Bonds"), which only accrue interest at a specified rate until all other
certificates having an earlier final distribution date have been retired and
are converted thereafter to an interest-paying security, and planned
amortization class ("PAC") certificates, which are parallel pay CMOs which
generally require that specified amounts of principal be applied on each
payment date to one or more classes of CMOs (the "PAC Certificates"), even
though all other principal payments and prepayments of the mortgage assets are
then required to be applied to one or more other classes of the certificates.
The scheduled principal payments for the PAC Certificates generally have the
highest priority on each payment date after interest due has been paid to all
classes entitled to receive interest currently. Shortfalls, if any, are added
to the amount payable on the next payment date. The PAC Certificate payment
schedule is taken into account in calculating the final distribution date of
each class of PAC. In order to create PAC tranches, one or more tranches
generally must be created that absorb most of the volatility in the underlying
mortgage assets. These tranches tend to have market prices and yields that are
much more volatile than the PAC classes.

WARRANTS. The Corporate Bond, SunAmerica Balanced, Aggressive Growth,
Federated Value and Utility Portfolios may invest in warrants which give the
holder of the warrant a right to purchase a given number of shares of a
particular issue at a specified price until expiration. Such investments can
generally provide a greater

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potential for profit or loss than investments of equivalent amounts in the
underlying common stock. The prices of warrants do not necessarily move with
the prices of the underlying securities. If the holder does not sell the
warrant, it risks the loss of its entire investment if the market price of the
underlying stock does not, before the expiration date, exceed the exercise
price of the warrant plus the cost thereof. Investment in warrants is a
speculative activity. Warrants pay no dividends and confer no rights (other
than the right to purchase the underlying stock) with respect to the assets of
the issuer. Although certain of the Portfolios may not invest directly in
warrants, such Portfolios may invest in securities that are acquired as part of
a unit consisting of a combination of fixed-income and equity securities or
securities to which warrants are attached.

DESCRIPTION OF COMMERCIAL PAPER AND BOND RATINGS

COMMERCIAL PAPER RATINGS. Moody's employs the designations "P-1,"
"P-2" and "P-3" to indicate commercial paper having the highest capacity for
timely repayment. Issuers rated P-1 have a superior capacity for repayment of
short-term promissory obligations. P-1 repayment capacity will normally be
evidenced by the following characteristics: leading market positions in
well-established industries; high rates of return on funds employed;
conservative capitalization structures with moderate reliance on debt and ample
asset protection; broad margins in earnings coverage of fixed financial charges
and high internal cash generation; and well-established access to a range of
financial markets and assured sources of alternate liquidity. Issues rated P-2
have a strong capacity for repayment of short-term promissory obligations.
This will normally be evidenced by many of the characteristics cited above, but
to a lesser degree. Earnings trends and coverage ratios, while sound, will be
more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternative
liquidity is maintained.

Standard & Poor's ratings of commercial paper are graded into four
categories ranging from A for the highest quality obligations to D for the
lowest. A - Issues assigned its highest rating are regarded as having the
greatest capacity for timely payment. Issues in this category are delineated
with numbers 1, 2, and 3 to indicate the relative degree of safety. A-1 -
This designation indicates that the degree of safety regarding timely payment
is either overwhelming or very strong. Those issues determined to possess
overwhelming safety characteristics will be denoted with a plus (+) sign
designation. A-2 - Capacity for timely payments on issues with this
designation is strong. However, the relative degree of safety is not as high
as for issues designated A-1.

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Duff & Phelps Rating Co. ("Duff & Phelps") commercial paper ratings
are consistent with the short-term rating criteria utilized by money market
participants. Duff & Phelps commercial paper ratings refine the traditional 1
category. The majority of commercial issuers carry the higher short-term
rating yet significant quality differences within that tier do exist. As a
consequence, Duff & Phelps has incorporated gradations of 1+ and 1- to assist
investors in recognizing those differences.

Duff 1+ - Highest certainty of time repayment. Short-term liquidity,
including internal operating factors and/or access to alternative sources of
funds, is outstanding, and safety is just below risk-free U.S. Treasury
short-term obligations. Duff 1 - Very high certainty of timely payment.
Liquidity factors are excellent and supported by good fundamental protection
factors. Risk factors are minor. Duff 1- - High certainty of timely
payment. Liquidity factors are strong and supported by good fundamental
protection factors. Risk factors are very small. Duff 2 - Good certainty of
timely payment. Liquidity factors and company fundamentals are sound.
Although ongoing funding needs may enlarge total financing requirements, access
to capital markets is good. Risk factors are small. Duff 3 - Satisfactory
liquidity and other protection factors, qualify issue as investment grade.
Risk factors are larger and subject to more variation. Nevertheless, timely
payment is expected. Duff 4 - Speculative investment characteristics.
Liquidity is not sufficient to insure against disruption in debt service.
Operating factors and market access may be subject to a high degree of
variation. Duff 5 - Default.

The short-term ratings of Fitch Investor Services, Inc. ("Fitch")
apply to debt obligations that are payable on demand or have original
maturities of generally up to three years, including commercial paper,
certificates of deposit, medium-term notes, and municipal and investment notes.
The short-term rating places greater emphasis than a long-term rating on the
existence of liquidity necessary to meet the issuer's obligations in a timely
manner. Fitch short-term ratings are as follows: F-1+ Exceptionally Strong
Credit Quality - Issues assigned this rating are regarded as having the
strongest degree of assurance for timely payment. F-1 Very Strong Credit
Quality -Issues assigned this rating reflect an assurance of timely payment
only slightly less in degree than issues rated F-1+. F-2 Good Credit Quality -
Issues assigned this rating have a satisfactory degree of assurance for timely
payment, but the margin of safety is not as great as for issues assigned F-1+
and F-1 ratings. F-3 Fair Credit Quality - Issues assigned this rating have
characteristics suggesting that the degree of assurance for timely payment is
adequate, however, near-term adverse changes could cause these securities to be
rated below investment grade. F-5 Weak Credit Quality -Issues assigned this
rating have characteristics suggesting a minimal degree of assurance for timely
payment and are vulnerable to near-term

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adverse changes in financial and economic conditions. D Default - Issues
assigned this rating are in actual or imminent payment default. LOC - The
symbol LOC indicates that the rating is based on a letter of credit issued by a
commercial bank.

Thomson BankWatch, Inc. ("BankWatch") short-term ratings apply only to
unsecured instruments that have a maturity of one year or less. These
short-term ratings specifically assess the likelihood of an untimely payment of
principal and interest. TBW-1 is the highest category, which indicates a very
high degree of likelihood that principal and interest will be paid on a timely
basis. TBW-2 is the second highest category and, while the degree of safety
regarding timely repayment of principal and interest is strong, the relative
degree of safety is not as high as for issues rated TBW-1.

CORPORATE DEBT SECURITIES. Moody's rates the long-term debt
securities issued by various entities from "Aaa" to "C." Aaa - Best quality.
These securities carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a larger, or by
an exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized are
more unlikely to impair the fundamentally strong position of these issues. Aa
- - High quality by all standards. They are rated lower than the best bond
because margins of protection may not be as large as in Aaa securities,
fluctuation of protective elements may be of greater amplitude, or there may be
other elements present that make the long-term risks appear somewhat greater.
A - Upper medium grade obligations. These bonds possess many favorable
investment attributes. Factors giving security to principal and interest are
considered adequate, but elements may be present that suggest a susceptibility
to impairment sometime in the future. Baa - Medium grade obligations.
Interest payments and principal security appear adequate for the present but
certain protective elements may be lacking or may be characteristically
unreliable over any great length of time. Such bonds lack outstanding
investment characteristics and, in fact, have speculative characteristics as
well. Ba - Have speculative elements; future cannot be considered as well
assured. The protection of interest and principal payments may be very
moderate and thereby not well safeguarded during both good and bad times over
the future. Bonds in this class are characterized by uncertainty of position.
B - Generally lack characteristics of the desirable investment assurance of
interest and principal payments or of maintenance of other terms of the
contract over any long period of time may be small. Caa - Of poor standing.
Issues may be in default or there may be present elements of danger with
respect to principal or interest. Ca - Speculative in a high degree; often
in default or have other marked shortcomings. C - Lowest rated class of
bonds; can be regarded as having extremely poor prospects of ever attaining any
real investment standings.

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Standard & Poor's rates the long-term securities debt of various
entities in categories ranging from "AAA" to "D" according to quality. AAA -
Highest rating. Capacity to pay interest and repay principal is extremely
strong. AA - High grade. Very strong capacity to pay interest and repay
principal. Generally, these bonds differ from AAA issues only in a small
degree. A - Have a strong capacity to pay interest and repay principal,
although they are somewhat more susceptible to the adverse effects of change in
circumstances and economic conditions than debt in higher rated categories.
BBB - Regarded as having adequate capacity to pay interest and repay
principal. These bonds normally exhibit adequate protection parameters, but
adverse economic conditions or changing circumstances are more likely to lead
to a weakened capacity to pay interest and repay principal than for debt in
higher rated categories. BB, B, CCC, CC, C - Regarded, on balance, as
predominately speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation. BB indicated the
lowest degree of speculation and C the highest degree of speculative. While
this debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions. C1 - Reserved for income bonds on which no interest is being
paid. D - In default and payment of interest and/or repayment of principal
is in arrears.

Fitch rates the long-term debt securities issued by various entities
in categories "AAA" to "D" according to quality. AAA is considered to be
investment grade and of the highest credit quality. The ability to pay
interest and repay principal is exceptionally strong. AA is considered to be
investment grade and of very high credit quality. The ability to pay interest
and repay principal is very strong, although not quite as strong as AAA issues.
A is considered to be investment grade and of high credit quality. The ability
to pay interest and repay principal is strong, but these issues may be more
vulnerable to adverse changes in economic conditions and circumstances than
higher rated issues. BBB is considered to be investment grade and of
satisfactory credit quality. The ability to pay interest and repay principal
is adequate. These issues are more likely to be affected by adverse changes in
economic conditions and circumstances and, therefore, impair timely payment.
The likelihood that the ratings of these issues will fall below investment
grade is higher than for issues with higher ratings. BB is considered
speculative. The ability to pay interest and repay principal may be affected
over time by adverse economic changes. B is considered highly speculative.
The probability of continued timely payment of principal and interest reflects
the obligor's limited margin of safety and the need for reasonable business and
economic activity throughout the life of the issue. CCC issues are considered
to have certain identifiable characteristics which may lead to default. The
ability to meet obligations requires an advantageous business and economic
environment. CC issues are minimally protected and default in

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payment of interest and/or principal seems probable over time. Issues rated C
are in imminent default in payment of interest or principal. DDD, DD, and D
issues are in default on interest and/or principal payments and are extremely
speculative. Plus(+) and minus(-) signs are used with a rating symbol to
indicate the relative position within the rating category.

Duff & Phelps rates long-term debt specifically to credit quality,
i.e., the likelihood of timely payment for principal and interest. AAA is
considered the highest quality. AA is considered high quality. A is regarded
as good quality. BBB is considered to be investment grade and of satisfactory
credit quality. BB and B are considered to be non-investment grade and CCC is
regarded as speculative. Ratings in the long-term debt categories may include
a plus(+) or minus(-) designation which indicates where within the respective
category the issue is placed.

BankWatch rates the long-term debt securities issued by various
entities either AAA or AA. AAA is the highest category, which indicates the
ability to repay principal and interest on a timely basis is very high. AA is
the second highest category, which indicates a superior ability to repay
principal and interest on a timely basis with limited incremental risk versus
issues rated in the highest category. Ratings in the long-term debt categories
may include a plus (+) or minus (-) designation which indicates where within
the respective category the issue is placed.

INVESTMENT RESTRICTIONS

The Trust has adopted certain investment restrictions for each
Portfolio that cannot be changed without approval by a majority of its
outstanding voting securities. Such majority is defined as the vote of the
lesser of (i) 67% or more of the outstanding shares of the Portfolios present
at a meeting, if the holders of more than 50% of the outstanding shares are
present in person or by proxy or (ii) more than 50% of the outstanding shares
of the Portfolios.

INVESTMENT RESTRICTIONS OF THE CASH MANAGEMENT PORTFOLIO

The Cash Management Portfolio has adopted the following restrictions
that are fundamental policies. These fundamental policies, as well as the Cash
Management Portfolio's investment objective, cannot be changed without approval
by a majority of its outstanding voting securities. All percentage limitations
expressed in the following investment restrictions are measured

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immediately after the relevant transaction is made. The Cash Management
Portfolio may not:

1. Invest more than 5% of the value of its total assets in the
securities of any one issuer, provided that this limitation shall apply only to
75% of the value of the Portfolio's total assets, and, provided further, that
the limitation shall not apply to obligations of the government of the U.S. or
of any corporation organized as an instrumentality of the U.S. under a general
Act of Congress.

2. As to 75% of its total assets, purchase more than 10% of the
outstanding voting class of securities of an issuer.

3. Invest more than 25% of the Portfolio's total assets in the
securities of issuers in the same industry. Obligations of the U.S.
Government, its agencies and instrumentalities, are not subject to this 25%
limitation on industry concentration. In addition, the Portfolio may, if
deemed advisable, invest more than 25% of its assets in the obligations of
domestic commercial banks.

4. Enter into any repurchase agreement maturing in more than
seven days or invest in any other illiquid security if, as a result, more than
10% of the Portfolio's total assets would be so invested.

5. Make loans to others except for the purchase of the debt
securities listed above under its Investment Policies. The Portfolio may,
however, enter into repurchase agreements.

6. Borrow money, except from banks for temporary purposes, and
then in an amount not in excess of 5% of the value of the Portfolio's total
assets. Moreover, in the event that the asset coverage for such borrowings
falls below 300%, the Portfolio will reduce within three days the amount of its
borrowings in order to provide for 300% asset coverage.

7. Pledge or hypothecate its assets.

8. Sell securities short except to the extent that the Portfolio
contemporaneously owns or has the right to acquire at no additional cost
securities identical to those sold short.

9. Invest in puts, calls, straddles, spreads or any combination
thereof.

10. Purchase or sell securities of other investment companies
(except in connection with a merger, consolidation, acquisition or
reorganization), real estate or commodities.

11. Act as underwriter of securities issued by others, engage in
distribution of securities for others, or make investments in

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other companies for the purpose of exercising control or management.

Notwithstanding investment restriction Number 1 above, in order to
comply with Rule 2a-7 under the Investment Company Act of 1940, as amended (the
"1940 Act"), the Cash Management Portfolio has adopted a more restrictive
policy (which may be changed by the trustees without shareholder approval) of
investing no more than 5% of its assets (measured at the time of purchase) in
the securities of any one issuer (other than the U.S. Government); provided
however, that the Cash Management Portfolio may invest, as to 25% of its
assets, more than 5% of its assets in certain high-quality securities (as
defined in the Rule) of a single issuer for a period of up to three business
days. The purchase by the Cash Management Portfolio of securities that have
"put" or "stand-by" commitment features are not considered "puts" for purposes
of investment restriction Number 9 above.

INVESTMENT RESTRICTIONS OF THE CORPORATE BOND PORTFOLIO,
GLOBAL BOND PORTFOLIO, HIGH-YIELD BOND PORTFOLIO, WORLDWIDE HIGH
INCOME PORTFOLIO, BALANCED/PHOENIX INVESTMENT COUNSEL PORTFOLIO,
SUNAMERICA BALANCED PORTFOLIO, ASSET ALLOCATION PORTFOLIO,
GROWTH-INCOME PORTFOLIO, AGGRESSIVE GROWTH PORTFOLIO, ALLIANCE
GROWTH PORTFOLIO, GROWTH/PHOENIX INVESTMENT COUNSEL PORTFOLIO,
PROVIDENT GROWTH PORTFOLIO, FEDERATED VALUE PORTFOLIO, VENTURE
VALUE PORTFOLIO, UTILITY PORTFOLIO, GLOBAL EQUITIES PORTFOLIO AND
INTERNATIONAL DIVERSIFIED EQUITIES PORTFOLIO

The Corporate Bond Portfolio, Global Bond Portfolio, High-Yield Bond
Portfolio, Worldwide High Income Portfolio, Balanced/Phoenix Investment Counsel
Portfolio, SunAmerica Balanced Portfolio, Asset Allocation Portfolio,
Growth-Income Portfolio, Aggressive Growth Portfolio, Alliance Growth
Portfolio, Growth/Phoenix Investment Counsel Portfolio, Provident Growth
Portfolio, Federated Value Portfolio, Venture Value Portfolio, Utility
Portfolio, Global Equities Portfolio and International Diversified Equities
Portfolio have each adopted the following investment restrictions that are
fundamental policies. These fundamental policies cannot be changed without the
approval of the holders of a majority of the outstanding voting securities of
the respective Portfolio. All percentage limitations expressed in the
following investment restrictions are measured immediately after the relevant
transaction is made. These Portfolios may not:

1. Other than the Global Bond, Worldwide High Income and
International Diversified Equities Portfolios, invest more than 5% of the value
of the total assets of a Portfolio in the securities of any one issuer,
provided that this limitation shall apply only to 75% of the value of the
Portfolio's total assets and, provided further, that the limitation shall not
apply to obligations issued or guaranteed by the government of the United
States or of any of its agencies or instrumentalities.

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2. As to 75% of its total assets, purchase more than 10% of any
class of the outstanding voting securities of an issuer. This restriction does
not apply to the Global Bond, International Diversified Equities and Worldwide
High Income Portfolios.

3. Invest more than 25% of the Portfolio's total assets in the
securities of issuers in the same industry, except that the Utility Portfolio
will invest at least 25% of its total assets in the securities of utility
companies. Obligations of the U.S. Government, its agencies and
instrumentalities are not subject to this 25% limitation on industry
concentration. The Portfolio may, if deemed advisable, invest more than 25% of
its assets in the obligations of domestic commercial banks.

4. Invest in real estate (including limited partnership interests
but excluding securities of companies, such as real estate investment trusts,
which deal in real estate or interests therein); provided that a Portfolio may
hold or sell real estate acquired as a result of the ownership of securities.

5. Purchase commodities or commodity contracts; except that any
Portfolio may engage in transactions in put and call options on securities,
indices and currencies, forward and futures contracts on securities, indices
and currencies, put and call options on such futures contracts, forward
commitment transactions, forward foreign currency exchange contracts,
interest-rate, mortgage and currency swaps and interest-rate floors and caps.

6. Invest in companies for the purpose of exercising control or
management.

7. Make loans to others except for (a) the purchase of debt
securities; (b) entering into repurchase agreements; and (c) with respect to
the Corporate Bond, Global Bond, High-Yield Bond, Worldwide High Income,
Balanced/Phoenix Investment Counsel, SunAmerica Balanced, Asset Allocation,
Growth-Income, Aggressive Growth, Federated Value, Venture Value, Utility,
Global Equities and International Diversified Equities Portfolios, the lending
of its portfolio securities.

8. Borrow money, except from banks for temporary purposes, and
then in an amount not in excess of one-third of the value of a Portfolio's
total assets. Moreover, in the event that the asset coverage for such
borrowings falls below 300%, the Portfolio will reduce, within three days, the
amount of its borrowings in order to provide for 300% asset coverage. A
Portfolio, other than the Worldwide High Income and Aggressive Growth
Portfolios, will not purchase additional securities while the value of their
borrowings exceeds 5% of its total assets. Notwithstanding the foregoing, the
Worldwide High Income and Aggressive Growth Portfolios may borrow for
investment purposes.

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9. Purchase securities on margin.

10. Pledge, mortgage or hypothecate its assets, except to the
extent necessary to secure permitted borrowings and, to the extent related to
the segregation of assets in connection with the writing of covered put and
call options and the purchase of securities or currencies on a forward
commitment or delayed-delivery basis and collateral and initial or variation
margin arrangements with respect to forward contracts, options, futures
contracts and options on futures contracts. In addition, the Corporate Bond,
High-Yield Bond, Worldwide High Income SunAmerica Balanced, Aggressive Growth,
Federated Value and Utility Portfolios may pledge units in reverse repurchase
agreements.

11. Sell securities short except to the extent that a Portfolio
contemporaneously owns, or has the right to acquire at no additional cost,
securities identical to those sold short. This restriction does not preclude
the segregation of assets by the Worldwide High Income Portfolio in connection
with short sales of securities that it does not contemporaneously own or have
the right to acquire without additional cost.

12. Purchase or sell securities of other investment companies
(except in connection with a merger, consolidation, acquisition or
reorganization); provided, however, that (a) the Global Equities Portfolio may
purchase securities of a closed-end investment company, (b) to the extent
permitted by applicable law and approved by the Trustees, the Asset Allocation
and Global Bond Portfolios may invest uninvested cash balances in any money
market fund for which their respective Subadvisers or any affiliate thereof
acts as investment adviser, and (c) the Worldwide High Income, Balanced/Phoenix
Investment Counsel, SunAmerica Balanced, Federated Value, Venture Value,
Utility, International Diversified Equities and Aggressive Growth Portfolios
may purchase securities of other investment companies; provided, however, that
in each case (i) a Portfolio owns no more than 3% of the total outstanding
voting stock of any investment company, (ii) no more than 5% of the value of a
Portfolio's total assets are invested in securities of any investment company,
and (iii) no more than 10% of such value is invested in investment companies in
the aggregate.

13. Engage in underwriting of securities issued by others, except
to the extent it may be deemed to be acting as an underwriter in the purchase
and resale of portfolio securities. This restriction does not apply to the
Worldwide High Income Portfolio.

In addition to the foregoing, the Corporate Bond, Global Bond,
High-Yield Bond, Worldwide High Income, Balanced/Phoenix Investment Counsel,
SunAmerica Balanced, Asset Allocation, Growth-Income, Aggressive Growth,
Alliance Growth, Growth/Phoenix Investment Counsel, Provident Growth, Federated
Value, Venture Value,

B-26
<PAGE> 69

Utility, Global Equities and International Diversified Equities
Portfolios have each adopted a non-fundamental policy (which may be
changed by the Trustees without shareholder approval) of not entering
into any repurchase agreement maturing in more than seven days or
investing in any other illiquid security if, as a result, more than
15% of a Portfolio's total assets would be so invested.

TRUST OFFICERS AND TRUSTEES

The Trustees and executive officers of the Trust, their ages and
principal occupations for the past five years are set forth below. Each
Trustee also serves as a trustee of the Anchor Pathway Fund. Unless otherwise
noted, the address of each executive officer and trustee is 1 SunAmerica
Center, Century City, Los Angeles, California 90067-6022.

<TABLE>
<CAPTION>
Name, Age and Position(s) Principal Occupation(s) During Past Five Years
-----------------------------------------------
Held with the Trust
--------------------
<S> <C>
RICHARDS D. BARGER, 67, Trustee Senior Partner, Law Firm of Barger & Wolen; former
Director, Anchor National Life Insurance Company ("Anchor
National")(from 1980 to 1986).

FRANK L. ELLSWORTH, 52, Trustee President, the Independent Colleges of Southern California
(1991-present; President and Professor of Political
Studies, Pitzer College (1979-1991).

GORDON F. HAMPTON, 83, Trustee Senior Partner, Law Firm of Sheppard, Mullin, Richter &
Hampton (since 1938).

NORMAN J. METCALFE, 53, Trustee* Vice Chairman and Chief Financial Officer, The Irvine
Company (March 1993 to Present); Executive Vice President
(1986-1992) and Director (1984-1993), SunAmerica Inc.;
formerly, President, SunAmerica Investments,
Inc.(1988-1992); and Executive Vice President and
Director, Anchor National (1986-1992).

JAMES K. HUNT, 44, Trustee, Chairman and Executive Vice President, SunAmerica Investments, Inc.
President* (1993 to present); President, SunAmerica Corporate Finance
(since January 1994); Senior Vice President, SunAmerica
Investments Inc. (1990-1993).

SCOTT L. ROBINSON, 49, Senior Vice President, Senior Vice President and Controller, SunAmerica Inc.
Treasurer and Controller (since 1991); Senior Vice President of Anchor National
(since 1988); Vice President and Controller, SunAmerica
</TABLE>

B-27
<PAGE> 70

<TABLE>
<S> <C>
Inc. (1986-1991), (joined SunAmerica Inc. in 1978)

SUSAN L. HARRIS, 38, Senior Vice President (since November 1995), Secretary
Vice President, Counsel and Secretary (since 1989) and General Counsel (since December 1994),
SunAmerica Inc.; Senior Vice President and Secretary,
Anchor National (since 1990); Joined SunAmerica Inc. in
1985.

Vice President, SunAmerica Asset Management Corp., since
PETER C. SUTTON, 31 September, 1994; Treasurer, SunAmerica Funds (since
Vice President February, 1996) Controller, SunAmerica Funds (1993-1996);
Assistant Controller, SunAmerica Funds (1990-1993).
</TABLE>

- -----------------
* A trustee who may be deemed to be an "interested person" of the Trust as that
term is defined in the 1940 Act.

The Trust pays no salaries or compensation to any of its officers, all
of whom are officers or employees of Anchor National Life Insurance Company or
its affiliates. An annual fee of $7,000, plus $500 for each meeting attended,
and expenses are paid to each Trustee who is not an officer or employee of
Anchor National Life Insurance Company or its affiliates for attendance at
meetings of the Board of Trustees. All other Trustees receive no remuneration
from the Trust.

The following table sets forth information summarizing the
compensation of each of the Trustees for his services as Trustee for the fiscal
year ended November 30, 1995.

COMPENSATION TABLE

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
AGGREGATE PENSION OR RETIREMENT TOTAL COMPENSATION FROM
COMPENSATION FROM BENEFITS ACCRUED AS REGISTRANT AND FUND
TRUSTEE REGISTRANT PART OF FUND EXPENSES* COMPLEX PAID TO TRUSTEES*
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Richards D. Barger $7,000 - $20,000
- -----------------------------------------------------------------------------------------------------------------
Frank L. Ellsworth $7,000 - $20,000
- -----------------------------------------------------------------------------------------------------------------
Gordon F. Hampton $7,000 - $20,000
- -----------------------------------------------------------------------------------------------------------------
Norman J. Metcalfe $7,000 - $20,000
- -----------------------------------------------------------------------------------------------------------------
</TABLE>

B-28
<PAGE> 71

* Information is as of November 30, 1995 for the two Funds in the complex which
pay fees to these directors/trustees (the Trust and Anchor Pathway Fund).

INVESTMENT ADVISORY AND MANAGEMENT AGREEMENT

The Trust, on behalf of each Portfolio, entered into an Investment
Advisory and Management Agreement with SunAmerica Asset Management Corp. to
handle the management of the Trust and its day to day affairs.

The Investment Advisory and Management Agreement (except with respect
to the Venture Value, International Diversified Equities, Worldwide High
Income, Balanced/Phoenix Investment Counsel, SunAmerica Balanced, Aggressive
Growth, Federated Value and Utility Portfolios) continues in effect from year
to year, in accordance with its terms, unless terminated, and may be renewed
from year to year as to each Portfolio for so long as such renewal is
specifically approved at least annually by (i) the Board of Trustees, or by the
vote of a majority (as defined in the 1940 Act) of the outstanding voting
securities of each relevant Portfolio, and (ii) the vote of a majority of
Trustees who are not parties to the Agreement or interested persons (as defined
in the 1940 Act) of any such party, cast in person, at a meeting called for the
purpose of voting on such approval. With respect to the Venture Value,
International Diversified Equities, Worldwide High Income and Balanced/Phoenix
Investment Counsel Portfolios, the Agreement will continue in effect until
September 16, 1996, unless terminated, and may be renewed from year to year
thereafter in the manner set forth above. With respect to the SunAmerica
Balanced, Aggressive Growth, Federated Value and Utility Portfolios, the
Agreement will continue in effect until __________, 1998, unless terminated,
and may be renewed from year to year thereafter in the manner set forth above.
The Agreement also provides that it may be terminated by either party without
penalty upon 60 days' written notice to the other party. The Agreement
provides for automatic termination upon assignment.

The Investment Advisory and Management Agreement provides that the
Adviser shall act as investment adviser to the Trust, manage the Trust's
investments, administer its business affairs, furnish offices, necessary
facilities and equipment, provide clerical, bookkeeping and administrative
services, and permit any of the Adviser's officers or employees to serve
without compensation as Trustees or officers of the Trust if duly elected to
such positions. Under the Agreement, the Trust agrees to assume and pay
certain charges and expenses of its operations, including: direct charges
relating to the purchase and sale of portfolio securities, interest charges,
fees and expenses of independent legal counsel and independent accountants,
cost of stock certificates and any other expenses (including clerical expenses)
of issue, sale, repurchase or redemption of shares, expenses of registering and

B-29
<PAGE> 72

qualifying shares for sale, expenses of printing and distributing reports,
notices and proxy materials to shareholders, expenses of data processing and
related services, shareholder recordkeeping and shareholder account service,
expenses of printing and distributing prospectuses and statements of additional
information, expenses of annual and special shareholders' meetings, fees and
disbursements of transfer agents and custodians, expenses of disbursing
dividends and distributions, fees and expenses of Trustees who are not
employees of the Adviser or its affiliates, membership dues in the Investment
Company Institute or any similar organization, all taxes and fees to Federal,
state or other governmental agencies, insurance premiums and extraordinary
expenses such as litigation expenses.

Each Portfolio pays its actual expenses for custodian services and a
portion of the Custodian's costs determined by the ratio of portfolio assets to
the total assets of the Trust, brokerage commissions or transaction costs, and
registration fees. Subject to supervision of the Board of Trustees, fees for
independent accountants, legal counsel, costs of reports of notices to
shareholders will be allocated based on the relative net assets of each
Portfolio. With respect to audit or legal fees clearly attributable to one
Portfolio, they will be assessed, subject to review by the Board of Trustees,
against that Portfolio.

As compensation for its services, the Adviser receives from the Trust
a fee, accrued daily and payable monthly, based on the net assets of each
Portfolio. This fee will be reduced to the extent necessary to comply with any
applicable state expense limitations. Presently, the most restrictive expense
limitation requires that the Trust's aggregate annual expenses (excluding
interest, taxes and brokerage fees) shall not normally exceed 2.5% of the first
$30 million of average net assets, 2% of the next $70 million of average net
assets and 1.5% of the remaining average net assets.

The following table sets forth the total advisory fees received by the
Adviser from each Portfolio pursuant to the Investment Advisory and Management
Agreement for the fiscal years ended November 30, 1995, 1994 and 1993.

ADVISORY FEES

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
PORTFOLIO 1995 1994 1993*
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Management $438,400 $324,890 $63,788
- -------------------------------------------------------------------------------------------------------
Corporate Bond
(formerly, Fixed Income) $144,546 $117,895 $17,489
- -------------------------------------------------------------------------------------------------------
Global Bond $365,313 $291,574 $41,215
- --------------------------------------------------------------------------------------------------------
</TABLE>

B-30
<PAGE> 73

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
High-Yield Bond $478,203 $390,246 $111,701
- --------------------------------------------------------------------------------------------------------
Worldwide High Income $143,765 $9,545** n/a
- --------------------------------------------------------------------------------------------------------
Balanced/Phoenix
Investment Counsel $92,499 $745** n/a
- --------------------------------------------------------------------------------------------------------
Asset Allocation $1,000,248 $547,474 $53,709
- --------------------------------------------------------------------------------------------------------
Growth-Income $794,078 $475,666 $108,293
- --------------------------------------------------------------------------------------------------------
Alliance Growth $635,979 $287,322 $53,308
- --------------------------------------------------------------------------------------------------------
Growth/Phoenix
Investment Counsel $835,634 $642,732 $164,746
- --------------------------------------------------------------------------------------------------------
Provident Growth $785,809 $532,538 $142,566
- --------------------------------------------------------------------------------------------------------
Venture Value $504,014 $1,592** n/a
- --------------------------------------------------------------------------------------------------------
Global Equities $1,185,831 $884,882 $102,011
- --------------------------------------------------------------------------------------------------------
International
Diversified Equities $283,908 $10,202** n/a
- --------------------------------------------------------------------------------------------------------
</TABLE>

* For the period 2/9/93 (commencement of operations) through 11/30/93
** For the period 10/28/94 (commencement of operations) through 11/30/94

PERSONAL TRADING. The Trust and the Adviser have adopted a written
Code of Ethics (the "Code") which prescribes general rules of conduct and sets
forth guidelines with respect to personal securities trading by "Access
Persons" thereof. An Access Person as defined in the Code is an individual who
is a trustee, director, officer, general partner or advisory person of the
Trust or the Adviser. The guidelines on personal securities trading include:
(i) securities being considered for purchase or sale, or purchased or sold, by
any Investment Company advised by the Adviser, (ii) Initial Public Offerings,
(iii) private placements, (iv) blackout periods, (v) short-term trading
profits, (vi) gifts, and (vii) services as a director. These guidelines are
substantially similar to those contained in the Report of the Advisory Group on
Personal Investing issued by the Investment Company Institute's Advisory Panel.
The Adviser reports to the Board of Trustees on a quarterly basis, as to
whether there were any violations of the Code by Access Persons of the Trust or
any Subadviser during the quarter.

The Subadvisers have adopted a written Code of Ethics, the provisions
of which are materially similar to those in the Code, and have undertaken to
comply with the provisions of the Code to the extent such provisions are more
restrictive. Further, the Subadvisers report to the Adviser on a quarterly
basis, as to whether there were any Code of Ethics violations by employees
thereof who may be deemed Access Persons of the Trust. In turn, the Adviser
reports to the Board of Trustees as to whether there

B-31
<PAGE> 74

were any violations of the Code by Access Persons of the Trust or any
Subadviser.

SUBADVISORY AGREEMENTS

Alliance Capital Management L.P. ("Alliance"), Goldman Sachs Asset
Management ("GSAM"), a separate division of Goldman, Sachs & Co., Goldman
Sachs Asset Management International, ("GSAM-International"), an affiliate of
Goldman, Sachs & Co., Morgan Stanley Asset Management Inc., Phoenix Investment
Counsel, Inc., Provident Investment Counsel, Inc., Davis Selected Advisers,
L.P. and Federated Investment Counseling act as Subadvisers to certain of the
Trust's Portfolios pursuant to various Subadvisory Agreements with SAAMCo.
Under the Subadvisory Agreements, the Subadvisers manage the investment and
reinvestment of the assets of the respective Portfolios for which they are
responsible. Each of the Subadvisers is independent of SAAMCo and discharges
its responsibilities subject to the policies of the Trustees and the oversight
and supervision of SAAMCo, which pays the Subadvisers' fees.

The Adviser pays each Subadviser a monthly fee with respect to each
Portfolio for which the Subadviser performs services, computed on average daily
net assets, at the following annual rates:

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
SUBADVISER PORTFOLIO FEE
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Alliance Alliance Growth and .35% on the first $50 million
Growth-Income Portfolios .30% on the next $100 million
.25% on the next $150 million
.20% on the next $200 million
.15% thereafter
----------------------------------------------------------------------
Global Equities Portfolio .50% on the first $50 million
.40% on the next $100 million
.30% on the next $150 million
.25% thereafter
- -------------------------------------------------------------------------------------------------
Davis Selected Advisers, Venture Value Portfolio .45% on the first $100 million
L.P. .40% on the next $400 million
.35% thereafter
- -------------------------------------------------------------------------------------------------
Federated Investment Corporate Bond .30% on the first $25 million
Counseling Portfolio .25% on the next $25 million
.20% on the next $100 million
.15% thereafter
----------------------------------------------------------------------
</TABLE>

B-32
<PAGE> 75

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Federated Value and Utility .55% on the first $20 million
Portfolios .35% on the next $30 million
.25% on the next $100 million
.20% on the next $350 million
.15% thereafter
- -------------------------------------------------------------------------------------------------
GSAM Asset Allocation Portfolio .40% on the first $50 million
.30% on the next $100 million
.25% on the next $100 million
.20% thereafter
- -------------------------------------------------------------------------------------------------
GSAM- International Global Bond Portfolio .40% on the first $50 million
.30% on the next $100 million
.25% on the next $100 million
.20% thereafter
- -------------------------------------------------------------------------------------------------
Morgan Stanley Asset International Diversified Equities .65% on the first $350 million
Management Inc. and Worldwide High Income .60% thereafter
Portfolios
- -------------------------------------------------------------------------------------------------
Phoenix Investment Growth/Phoenix Investment Counsel .35% on the first $50 million
Counsel and Balanced/Phoenix Investment .30% on the next $100 million
Counsel Portfolios .25% on the next $150 million
.20% on the next $200 million
.15% thereafter
- -------------------------------------------------------------------------------------------------
Provident Investment Provident Growth Portfolio .50% on the first $50 million
Counsel .45% on the next $100 million
.35% on the next $100 million
.30% on the next $100 million
.25% thereafter
- -------------------------------------------------------------------------------------------------
</TABLE>

The following table sets forth the fees paid to the Subadvisers for
the fiscal years ended November 30, 1995, 1994 and 1993.

SUBADVISORY FEES

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
SUBADVISER PORTFOLIO 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alliance Growth $306,832 $143,523 $26,654**
----------------------------------------------------------------------------------
Alliance Growth-Income $379,671 $232,937 $52,638**
----------------------------------------------------------------------------------
Global Equities $616,892 $467,441 $56,673**
- ------------------------------------------------------------------------------------------------------------
Davis Selected
Advisers, L.P. Venture Value $281,866 $895* n/a
- ------------------------------------------------------------------------------------------------------------
</TABLE>

B-33
<PAGE> 76

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
GSAM Asset Allocation $485,722 $275,339 $28,273***
----------------------------------------------------------------------------------
Corporate Bond $72,273 $58,947 $8,745***
- ------------------------------------------------------------------------------------------------------------
GSAM
International Global Bond $194,306 $155,506 $21,981***
- ------------------------------------------------------------------------------------------------------------
Growth/Phoenix
Phoenix Investment
Investment Counsel $399,134 $310,107 $82,113**
Counsel ----------------------------------------------------------------------------------
Balanced/
Phoenix Investment
Counsel $46,249 $372* n/a
- ------------------------------------------------------------------------------------------------------------
Provident
Investment Provident
Counsel Growth $452,955 $310,398 $83,862**
- ------------------------------------------------------------------------------------------------------------
Worldwide High
Morgan Stanley Income $93,447 $6,204* n/a
Asset ----------------------------------------------------------------------------------
Management International
Diversified
Equities $184,540 $6,631* n/a
- ------------------------------------------------------------------------------------------------------------
</TABLE>

* For the period 10/28/94 (commencement of operations) through 11/30/94
** For the period 2/9/93 (commencement of operations) through 11/30/93
*** For the period 7/1/93 (commencement of operations) through 11/30/93

The Subadvisory Agreements (with the exception of the International
Diversified Equities, Worldwide High Income, Balanced/Phoenix Investment
Counsel, Venture Value, Provident Growth, SunAmerica Balanced, Aggressive
Growth, Federated Value, and Utility Portfolios) continue in effect from year
to year, so long as such continuance is specifically approved at least annually
in accordance with the requirements of the 1940 Act. The Subadvisory
Agreements with respect to the International Diversified Equities, Worldwide
High Income, Balanced/Phoenix Investment Counsel, Venture Value and Provident
Growth Portfolios will expire on September 16, 1996. The Subadvisory
Agreements with respect to Corporate Bond, Federated Value and Utility
Portfolios will expire on __________, 199_. They may be renewed from year to
year thereafter, so long as such continuance is approved at least annually in
accordance with the requirements of the 1940 Act. The Subadvisory Agreements
provide that they will terminate in the event of an assignment (as defined in
the 1940 Act) or upon termination of the Advisory Agreement. The Subadvisory
Agreements may be terminated by the Trust, the Adviser or the respective
Subadviser upon 60 days' prior notice.

B-34
<PAGE> 77
DIVIDENDS, DISTRIBUTIONS AND FEDERAL TAXES

The following table sets forth the Portfolios' capital loss carryover
for the fiscal year ended November 30, 1995.

CAPITAL LOSS CARRYOVER*

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
PORTFOLIO 1995
- -----------------------------------------------------------------------------------
<S> <C>
Corporate Bond $ 291,703
- -----------------------------------------------------------------------------------
Global Bond $ 889,577
- -----------------------------------------------------------------------------------
High-Yield Bond $9,010,069
- -----------------------------------------------------------------------------------
Provident Growth $3,161,237
- -----------------------------------------------------------------------------------
International Diversified Equities $ 211,683
- -----------------------------------------------------------------------------------
</TABLE>

* To the extent not yet utilized, such losses will be available to each
of the Portfolios to offset future gains through 2003

PRICE OF SHARES

Shares of the Trust are currently offered only to the Variable
Separate Account. The price paid for shares, the offering price, is the net
asset value per share calculated once daily at the close of regular trading
(currently 4:00 p.m., New York time) each day the New York Stock Exchange is
open. The New York Stock Exchange is currently closed on weekends and on the
following holidays: New Year's Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving and Christmas Day.

Stocks and convertible bonds and debentures traded on the New York
Stock Exchange are valued at the last sale price on such exchange on the day of
valuation, or if there is no sale on the day of valuation, at the last-reported
bid price. Non-convertible bonds and debentures and other long-term debt
securities normally are valued at prices obtained for the day of valuation from
a bond pricing service, when such prices are available. In circumstances where
the Adviser or subadviser deems it appropriate to do so, an over-the-counter or
exchange quotation (at the mean of representative quoted bid or asked prices
for such securities or, if such prices are not available, at prices for
securities of comparable maturity, quality and type) may be used. Securities
traded primarily on securities exchanges outside the United States are valued
at the last sale price on such exchanges on the day of valuation, or if there
is no sale on the day of valuation, at the

B-35
<PAGE> 78
last-reported bid price. U.S. Treasury bills, and other obligations issued by
the U.S. Government, its agencies or instrumentalities, certificates of deposit
issued by banks, corporate short-term notes and other short-term investments
with original or remaining maturities in excess of 60 days are valued at the
mean of representative quoted bid and asked prices for such securities or, if
such prices are not available, for securities of comparable maturity, quality
and type. Short-term securities with 60 days or less to maturity are amortized
to maturity based on their cost to the Trust if acquired within 60 days of
maturity or, if already held by the Trust on the 60th day, are amortized to
maturity based on the value determined on the 61st day. Options on currencies
purchased by a Portfolio are valued at their last bid price in the case of
listed options or at the average of the last bid prices obtained from dealers
in the case of OTC options. Futures contracts involving foreign currencies
traded on exchanges are valued at their last sale or settlement price as of the
close of such exchanges or if no sales are reported, at the mean between the
last reported bid and asked prices. Other securities are valued on the basis
of last sale or bid price (if a last sale price is not available) in what is,
in the opinion of the Adviser or subadviser, the broadest and most
representative market, that may be either a securities exchange or the
over-the-counter market. Where quotations are not readily available,
securities are valued at fair value as determined in good faith by the Board of
Trustees. The fair value of all other assets is added to the value of
securities to arrive at the respective Portfolio's total assets.

A Portfolio's liabilities, including proper accruals of expense items,
are deducted from total assets. The net asset value of the respective
Portfolio is divided by the total number of shares outstanding to arrive at the
net asset value per share.

EXECUTION OF PORTFOLIO TRANSACTIONS

It is the policy of the Trust, in effecting transactions in portfolio
securities, to seek the best execution at the most favorable prices. The
determination of what may constitute best execution involves a number of
considerations, including the economic result to the Trust (involving both
price paid or received and any commissions and other costs), the efficiency
with which the transaction is effected where a large block is involved, the
availability of the broker to stand ready to execute potentially difficult
transactions and the financial strength and stability of the broker. Such
considerations are judgmental and are considered in determining the overall
reasonableness of brokerage commissions paid.

A factor in the selection of brokers is the receipt of research
services -- analyses and reports concerning issuers, industries, securities,
economic factors and trends -- and other statistical

B-36
<PAGE> 79
and factual information. Research and other statistical and factual
information provided by brokers is considered to be in addition to and not in
lieu of services required to be performed by the Adviser or subadviser.

The extent to which commissions may reflect the value of research
services cannot be presently determined. To the extent that research services
of value are provided by broker-dealers with or through whom the Adviser or
Subadviser places the Trust's portfolio transactions, the Adviser or Subadviser
may be relieved of expenses it might otherwise bear. Research services
furnished by broker-dealers could be useful and of value to the Adviser or
Subadviser in serving other clients as well as the Trust and research services
obtained by the Adviser or Subadviser as a result of the placement of portfolio
brokerage of other clients could be useful and of value in serving the Trust.

In the over-the-counter market, securities are generally traded on a
"net" basis with dealers acting as principal for their own accounts without a
stated commission, although the price of a security usually includes a profit
to the dealer. In underwritten offerings, securities are purchased at a fixed
price which includes an amount of compensation to the underwriter, generally
referred to as the underwriter's concession or discount. On occasion, certain
money market instruments may be purchased directly from an issuer, in which
case no commissions or discounts are paid. The Trust has obtained exemptive
orders from the Securities and Exchange Commission (the "SEC"), permitting the
Trust in certain circumstances to deal with securities dealers (that may be
deemed to be affiliated persons of affiliated persons of the Trust solely
because of a subadvisory relationship with one or more Portfolios) as a
principal in purchases and sales of certain securities, and to pay commissions,
fees or other remuneration to such securities dealers in connection with the
sale of securities to or by any of the Portfolios on a securities exchange
without complying with certain of the requirements of Rule 17e-1 under the 1940
Act.

Subject to the above considerations, the Adviser or a Subadviser may
use broker-dealer affiliates of the Adviser or a Subadviser, as a broker for
any Portfolio. In order for such broker-dealer to effect any portfolio
transactions for a Portfolio, the commissions, fees or other remuneration
received by the broker-dealer must be reasonable and fair compared to the
commissions, fees or other remuneration paid to other brokers in connection
with comparable transactions involving similar securities being purchased or
sold on a securities exchange during a comparable period of time. This
standard would allow such broker-dealer to receive no more than the
remuneration which would be expected to be received by an unaffiliated broker
in a commensurate arm's-length transaction. Furthermore, the Trustees of the
Trust, including a majority of the non-interested Trustees, have adopted
procedures which are reasonably designed to provide that any commissions, fees
or other

B-37
<PAGE> 80

remuneration paid to such broker-dealers are consistent with the foregoing
standard. These types of brokerage transactions are also subject to such
fiduciary standards as may be imposed upon the broker-dealers by applicable
law.

The following tables set forth the brokerage commissions paid by the
Portfolios and the amounts of the brokerage commissions which were paid to
affiliated broker-dealers of such Portfolios for the fiscal years ended
November 30, 1995, 1994 and 1993.

1995 BROKERAGE COMMISSIONS

<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
PERCENTAGE
AGGREGATE AMOUNT PAID TO PAID TO
BROKERAGE AFFILIATED AFFILIATED
PORTFOLIO COMMISSIONS BROKER-DEALERS BROKER-DEALERS
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Management $0 $0 0%
- --------------------------------------------------------------------------------------------------------------
Corporate Bond* $562 $562 100%
- --------------------------------------------------------------------------------------------------------------
Global Bond $0 $0 0%
- --------------------------------------------------------------------------------------------------------------
High-Yield Bond $9,100 $0 0%
- --------------------------------------------------------------------------------------------------------------
Worldwide High Income $0 $0 0%
- --------------------------------------------------------------------------------------------------------------
Balanced/Phoenix
Investment Counsel $49,029 $0 0%
- --------------------------------------------------------------------------------------------------------------
Asset Allocation* $331,914 $35,946 10.83%
- --------------------------------------------------------------------------------------------------------------
Growth-Income $262,353 $0 0%
- --------------------------------------------------------------------------------------------------------------
Alliance Growth $353,849 $0 0%
- --------------------------------------------------------------------------------------------------------------
Growth/Phoenix
Investment Counsel $548,063 $0 0%
- --------------------------------------------------------------------------------------------------------------
Provident Growth $118,520 $0 0%
- --------------------------------------------------------------------------------------------------------------
Venture Value $184,729 $0 0%
- --------------------------------------------------------------------------------------------------------------
Global Equities $630,010 $0 0%
- --------------------------------------------------------------------------------------------------------------
International
Diversified $117,482 $0 0%
Equities
- --------------------------------------------------------------------------------------------------------------
</TABLE>

* For the fiscal year ended November 30, 1995, the percentage of the
aggregate dollar amount of the transactions involving the payment of
commissions effected through affiliated brokers with respect to the Corporate
Bond Portfolio and Asset Allocation Portfolio were 10.34% and 100%,
respectively.

B-38
<PAGE> 81

1994 BROKERAGE COMMISSIONS

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
PERCENTAGE
AGGREGATE AMOUNT PAID TO PAID TO
BROKERAGE AFFILIATED AFFILIATED
PORTFOLIO COMMISSIONS BROKER-DEALER BROKER-DEALER
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Management $0 $0 0%
- ---------------------------------------------------------------------------------------------------------
Corporate Bond $0 $0 0%
- ---------------------------------------------------------------------------------------------------------
Global Bond $0 $0 0%
- ---------------------------------------------------------------------------------------------------------
High-Yield Bond $4,927 $0 0%
- ---------------------------------------------------------------------------------------------------------
Worldwide High
Income $0* $0* 0%*
- ---------------------------------------------------------------------------------------------------------
Balanced/Phoenix
Investment $1,586* $0* 0%*
Counsel
- ---------------------------------------------------------------------------------------------------------
Asset Allocation $130,727 $10,637 8.1%
- ---------------------------------------------------------------------------------------------------------
Growth-Income $187,474 $15,012** 8.0%
- ---------------------------------------------------------------------------------------------------------
Alliance Growth $195,332 $4,162** 2.1%
- ---------------------------------------------------------------------------------------------------------
Growth/Phoenix
Investment $484,811 $8,300 1.7%
Counsel
- ---------------------------------------------------------------------------------------------------------
Provident Growth $118,276 $3,963** 3.4%
- ---------------------------------------------------------------------------------------------------------
Venture Value $4,404* $0* 0%*
- ---------------------------------------------------------------------------------------------------------
Global Equities $350,958 $17,858** 5.1%
- ---------------------------------------------------------------------------------------------------------
International
Diversified $24,476* $6,194* 25.3%*
Equities
- ---------------------------------------------------------------------------------------------------------
</TABLE>

* For the period 10/28/94 (commencement of operations) through 11/30/94
** All brokerage commissions paid were directed to broker-dealers for research
services provided.

1993 BROKERAGE COMMISSIONS

B-39
<PAGE> 82

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Global Bond** $0 $0 0%
- ---------------------------------------------------------------------------------------------------------
High-Yield Bond* $0 $0 0%
- ---------------------------------------------------------------------------------------------------------
Asset Allocation** $38,831 $10,932 28.2%
- ---------------------------------------------------------------------------------------------------------
Growth-Income* $72,840 $1,197*** 1.6%
- ---------------------------------------------------------------------------------------------------------
Alliance Growth* $37,660 $1,208*** 3.2%
- ---------------------------------------------------------------------------------------------------------
Growth/Phoenix
Investment Counsel* $187,966 $18,973 10.1%
- ---------------------------------------------------------------------------------------------------------
Provident Growth* $55,938 $870*** 1.6%
Global Equities* $46,237 $553*** 1.2%
- ---------------------------------------------------------------------------------------------------------
</TABLE>

* For the period 2/9/93 (commencement of operations) through 11/30/93
** For the period 7/1/93 (commencement of operations) through 11/30/93
*** All brokerage commissions paid were directed to broker-dealers for research
services provided.

The policy of the Trust with respect to brokerage is reviewed by the
Board of Trustees from time to time. Because of the possibility of further
regulatory developments affecting the securities exchanges and brokerage
practices generally, the foregoing practices may be modified.

The Adviser and the Subadvisers and their respective affiliates may
manage, or have proprietary interests in, accounts with similar or dissimilar
or the same investment objectives as one or more Portfolios of the Trust. Such
account may or may not be in competition with a Portfolio for investments.
Investment decisions for such accounts are based on criteria relevant to such
accounts; portfolio decisions and results of the Portfolio's investments may
differ from those of such other accounts. There is no obligation to make
available for use in managing the Portfolio any information or strategies used
or developed in managing such accounts. In addition, when two or more accounts
seek to purchase or sell the same assets, the assets actually purchased or sold
may be allocated among accounts on a good faith equitable basis at the
discretion of the account's adviser. In some cases, this system may adversely
affect the price or size of the position obtainable for a Portfolio.

If determined by the Adviser or Subadviser to be beneficial to the
interests of the Trust, partners and/or employees of the Adviser or subadvisers
may serve on investment advisory committees, which will consult with the
subadviser regarding investment objectives and strategies for the Trust. In
connection with serving on such a committee, such persons may receive
information regarding a Portfolio's proposed investment activities which is not
generally available to unaffiliated market participants, and there will be no
obligation on the part of such persons to make available

B-40
<PAGE> 83

for use in managing the Portfolio any information or strategies known to them
or developed in connection with their other activities.

It is possible that a Portfolio's holdings may include securities of
entities for which a subadviser or its affiliate performs investment banking
services as well as securities of entities in which a subadviser or its
affiliate makes a market. From time to time, such activities may limit a
Portfolio's flexibility in purchases and sales of securities. When a
subadviser or its affiliate is engaged in an underwriting or other distribution
of securities of an entity, the subadviser may be prohibited from purchasing or
recommending the purchase of certain securities of that entity for the
Portfolio.

GENERAL INFORMATION

CUSTODIAN - State Street Bank and Trust Company ("State Street"), 225
Franklin Street, Boston, Massachusetts 02110, serves as the Trust's custodian.
In this capacity, State Street maintains the portfolio securities held by the
Trust, administers the purchase and sale of portfolio securities and performs
certain other duties. State Street also serves as transfer agent and dividend
disbursing agent for the Trust.

INDEPENDENT ACCOUNTANTS - Price Waterhouse LLP, 1177 Avenue of the
Americas, New York, New York 10036, is the Trust's independent accountants.
Price Waterhouse LLP performs an annual audit of the Trust's financial
statements and provides tax consulting, tax return preparation and accounting
services relating to filings with the SEC.

REPORTS TO SHAREHOLDERS - Persons having a beneficial interest in the
Trust are provided at least semi-annually with reports showing the investments
of the Portfolios, financial statements and other information.

SHAREHOLDER AND TRUSTEE RESPONSIBILITY - Shareholders of a
Massachusetts business trust may, under certain circumstances, be held
personally liable as partners for the obligations of the Trust. The risk of a
shareholder incurring any financial loss on account of shareholder liability is
limited to circumstances in which the Trust itself would be unable to meet its
obligations. The Declaration of Trust contains an express disclaimer of
shareholder liability for acts or obligations of the Trust and provides that
notice of the disclaimer must be given in each agreement, obligation or
instrument entered into or executed by the Trust or Trustees. The Declaration
of Trust provides for indemnification of any shareholder held personally liable
for the obligations of the Trust and also provides for the Trust to

B-41
<PAGE> 84
reimburse the shareholder for all legal and other expenses reasonably incurred
in connection with any such claim or liability.

Under the Declaration of Trust, the trustees or officers are not
liable for actions or failure to act; however, they are not protected from
liability by reason of their willful misfeasance, bad faith, gross negligence
or reckless disregard of the duties involved in the conduct of their office.
The Trust provides indemnification to its trustees and officers as authorized
by its By-Laws and by the 1940 Act and the rules and regulations thereunder.

REGISTRATION STATEMENT - A registration statement has been filed with
the Securities and Exchange Commission under the Securities Act of 1933, as
amended and the 1940 Act. The Prospectus and this Statement of Additional
Information do not contain all information set forth in the registration
statement, its amendments and exhibits thereto, that the Trust has filed with
the Securities and Exchange Commission, Washington, D.C., to all of which
reference is hereby made.

B-42
<PAGE> 85
FINANCIAL STATEMENTS

Set forth following this Statement of Additional Information are the
financial statements of the Trust with respect to the fiscal year ended
November 30, 1995.

B-43
<PAGE> 86

- ---------------------

SUNAMERICA SERIES TRUST
CASH MANAGEMENT PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
PRINCIPAL
SHORT-TERM SECURITIES--102.2% AMOUNT VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
CERTIFICATE OF DEPOSIT--1.1%
Fuji Bank Ltd. 6.00% due 12/28/95.................................... $1,000,000 $1,000,091
-----------
TOTAL CERTIFICATE OF DEPOSIT (cost $1,000,022)....................... 1,000,091
-----------
CORPORATE SHORT-TERM NOTES--91.2%

Abbey National North America 5.71% due 1/05/96....................... 2,000,000 1,988,858
AT&T Corp. 5.70% due 1/10/96......................................... 2,000,000 1,986,986
Bass Finance (C.I.) Ltd. 5.70% due 12/12/95.......................... 1,000,000 998,249
Bear Stearns & Co., Inc. 5.93% due 12/28/95(1)....................... 2,500,000 2,500,000
Bear Stearns & Co., Inc. 6.14% due 11/30/96.......................... 1,000,000 1,001,140
BHF Finance (DE), Inc. 5.68% due 12/05/95............................ 3,000,000 2,998,047
BIL North America, Inc. 5.70% due 1/09/96............................ 3,000,000.. 2,980,935
Cemex S.A. 5.69% due 2/22/96......................................... 1,000,000 986,747
Chemical Banking Corp. 5.72% due 1/31/96............................. 2,000,000 1,980,229
Corporacion Andina de Formento 5.74% due 1/31/96..................... 4,000,000 3,961,009
Cosco Co., Ltd. 5.72% due 2/13/96.................................... 2,000,000 1,976,500
Countrywide Funding Corp. 5.80% due 12/07/95......................... 1,000,000 999,033
CPC International, Inc. 5.71% due 1/12/96............................ 2,500,000 2,483,170
Duracell, Inc. 5.84% due 12/13/95.................................... 1,000,000 998,053
Equitable Life Assured Society of the U.S. 5.85% due 12/04/95........ 2,592,000 2,590,736
Fayette Funding L.P. 5.73% due 2/14/96............................... 3,000,000 2,964,343
Ford Motor Credit Co. 9.85% due 5/03/96.............................. 1,500,000 1,524,510
Golden Peanut Co. 5.65% due 2/21/96.................................. 2,000,000 1,973,809
Goldman Sachs & Co. 5.98% due 2/15/96*............................... 1,000,000 987,851
Goldman Sachs Group L.P. 5.60% due 4/09/96........................... 1,000,000 978,687
Goldman Sachs Group L.P. 5.60% due 4/17/96........................... 1,000,000 979,913
Indosuez North American, Inc. 5.71% due 1/04/96...................... 3,000,000 2,983,952
Iowa Student Loan Liquidity Corp. 5.77% due 12/07/95................. 3,084,000 3,081,034
JMG Funding L.P. 5.73% due 1/17/96................................... 2,000,000 1,984,762
Kaiser Foundation Hospitals 5.70% due 1/04/96........................ 1,000,000 994,678
Liberty Mutual Capital 8.50% due 7/08/96............................. 2,000,000 2,033,625
Mayne Nickless Ltd. 5.75% due 2/07/96................................ 2,000,000 1,978,073
Merrill Lynch & Co., Inc. 5.68% due 2/20/96.......................... 1,000,000 984,803
Merrill Lynch & Co., Inc. 5.70% due 1/16/96.......................... 2,000,000 1,985,113
Merrill Lynch & Co., Inc. 5.70% due 3/06/96.......................... 1,000,000 987,062
Morgan J P & Co., Inc. 5.58% due 1/03/96............................. 3,000,000 2,984,505
Morgan Stanley Group, Inc. 5.75% due 1/30/96......................... 2,000,000 1,980,867
NBD Bank N.A., Indianapolis 6.40% due 4/25/96........................ 2,000,000 2,004,240
October Corp. 5.85% due 12/21/95..................................... 2,000,000 1,993,500
PNC Bank N.A., Pittsburgh 5.75% due 12/14/95(1)...................... 3,000,000 3,003,330
Quebec (Province of) 5.70% due 1/30/96............................... 3,000,000 2,970,974
Sanwa Business Credit Corp. 5.80% due 12/11/95....................... 3,000,000 2,995,167
Southland Corp. 5.70% due 3/05/96.................................... 3,000,000 2,954,880
SRD Finance, Inc. 6.05% due 1/18/96.................................. 2,000,000 1,984,374
TMI-1 Fuel Corp. 5.78% due 1/11/96................................... 2,000,000 1,986,834
World Savings & Loan Association 4.88% due 3/01/96................... 1,000,000 997,644
-----------
TOTAL CORPORATE SHORT-TERM NOTES (cost $82,705,217).................. 82,708,222
-----------
</TABLE>

---------------------
5
<PAGE> 87
<TABLE>
<CAPTION>
PRINCIPAL
SHORT-TERM SECURITIES (continued) AMOUNT VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
MUNICIPAL BONDS--4.4%
Illinois Student Assistance Commission 5.97% due 12/05/95(1)......... $2,000,000 $2,000,000
New Hampshire State Industrial Development Authority, Revenue 5.85%
due 2/13/96........................................................ 2,000,000 2,000,000
-----------
TOTAL MUNICIPAL BONDS (cost $4,000,000).............................. 4,000,000
-----------
TIME DEPOSIT--5.5%
Cayman Island Time Deposit with Mitsubishi Bank
5.88% due 12/01/95 (cost $5,000,000)............................... 5,000,000 5,000,000
-----------
TOTAL SHORT-TERM SECURITIES (cost $92,705,239)....................... 92,708,313
-----------

REPURCHASE AGREEMENT--1.1%
--------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--1.1%
Joint Repurchase Agreement Account (Note 3)
(cost $973,000).................................................... 973,000 973,000
-----------
TOTAL INVESTMENTS--
(cost $93,678,239) 103.3% 93,681,313
Liabilities in excess of other assets-- (3.3) (2,950,120)
----- ------------
NET ASSETS-- 100.0% $90,731,193
===== ============

</TABLE>

-----------------------------

* Resale restricted to qualified institutional buyers

(1) Variable rate security; maturity date reflects next reset date

See Notes to Financial Statements

- ---------------------

6
<PAGE> 88

- ---------------------

SUNAMERICA SERIES TRUST
FIXED INCOME PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES--97.4% AMOUNT VALUE
------------------------------------------------------------------------------------------------

<S> <C> <C>
CONSUMER DISCRETIONARY--1.2%

Housing--1.2%
News America Holdings, Inc. 7.50% 2000............................... $ 150,000 $ 156,927
News America Holdings, Inc. 9.13% 1999............................... 175,000 192,806
-----------
349,733
-----------
CONSUMER STAPLES--0.9%

Food, Beverage & Tobacco--0.9%
RJR Nabisco, Inc. 8.00% 2001......................................... 75,000 76,202
RJR Nabisco, Inc. 8.63% 2002......................................... 185,000 190,866
-----------
267,068
-----------
ENERGY--3.3%

Energy Services--3.3%
Arkla, Inc. 9.20% 1997............................................... 65,000 68,089
Arkla, Inc. 9.88% 1997............................................... 315,000 328,725
National Power Corp. 7.63% 2000...................................... 60,000 59,250
Oryx Energy Co. 9.30% 1996........................................... 200,000 201,782
Oryx Energy Co. 9.50% 1999........................................... 140,000 149,926
Tosco Corp. 7.00% 2000............................................... 175,000 173,250
-----------
981,022
-----------
FINANCE--27.7%

Banks--10.3%
Auburn Hills Trust 12.00% 2020(2).................................... 140,000 213,802
Banco Nacional de Comercio Exterior SNC 11.25% 1996(1)(2)............ 390,000 390,000
BankAmerica Corp. 7.75% 2002......................................... 100,000 107,761
BanPonce Financial Corp. 5.17% 1996.................................. 175,000 173,966
Capital One Bank 7.48% 1996.......................................... 575,000 575,857
Continental Bank NA 12.50% 2001...................................... 300,000 384,204
Corporacion Andina de Fomento 7.25% 1998............................. 210,000 208,950
Corporacion Andina de Fomento 7.38% 2000............................. 70,000 71,059
First USA Bank 8.10% 1997............................................ 250,000 255,800
Security Pacific Corp. 11.50% 2000................................... 275,000 336,889
Signet Banking Corp. 9.63% 1999...................................... 300,000 330,054

Financial Services--17.4%

App International Finance Co. BV 10.25% 2000......................... 20,000 19,700
Case Equipment Loan Trust 7.30% 2002................................. 261,543 267,014
Chrysler Financial Corp. 5.98% 1997(1)............................... 100,000 100,111
Chrysler Financial Corp. 10.34% 2008(2).............................. 200,000 203,636
Countrywide Funding Corp. 7.73% 2001................................. 50,000 53,332
Countrywide Funding Corp. 8.43% 1999................................. 175,000 189,010
Discover Card Trust 7.20% 1998....................................... 208,333 208,398
Financiera Energet 6.63% 1996........................................ 410,000 408,462
First USA, Inc. 5.05% 1995........................................... 200,000 199,854
Ford Capital BV 9.50% 2001........................................... 400,000 460,212
Ford Credit Auto Loan Master Trust 6.50% 2002........................ 200,000 204,312
Ford Credit Grantor Trust 7.30% 1999................................. 73,206 74,418
General Motors Acceptance Corp. 6.30% 2099........................... 412,358 413,904
General Motors Acceptance Corp. 7.13% 2000........................... 90,000 93,565
General Motors Acceptance Corp. 7.50% 1997........................... 75,000 77,263
General Motors Acceptance Corp. 7.63% 1998........................... 175,000 181,484
Premier Auto Trust 4.75% 2000........................................ 189,015 187,125
</TABLE>

---------------------

7
<PAGE> 89

<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
FINANCE (continued)

Financial Services (continued)
Premier Auto Trust 4.90% 1998........................................ $ 105,880 $ 105,019
Premier Auto Trust 7.90% 1999........................................ 120,000 124,161
Resolution Funding Corp. zero coupon 2020............................ 680,000 134,273
Resolution Funding Corp. zero coupon 2021............................ 640,000 124,928
Sears Credit Account Master Trust 7.00% 2004......................... 80,000 83,225
Sears Credit Account Master Trust 8.10% 2004......................... 270,000 290,755
Standard Credit Card Master Trust 6.25% 1998......................... 260,000 261,056
Standard Credit Card Master Trust 7.85% 2002......................... 300,000 320,154
Standard Credit Card Master Trust 8.25% 2003......................... 310,000 342,451
-----------
8,176,164
-----------
INDUSTRIAL & COMMERCIAL--1.7%

Aerospace & Military Technology--0.4%
British Aerospace PLC 7.55% 1997*.................................... 100,000 101,711

Multi-Industry--1.3%
Tenneco, Inc. 10.00% 1998............................................ 350,000 383,982
-----------
485,693
-----------
INFORMATION & ENTERTAINMENT--3.8%

Broadcasting & Media--3.3%
Lenfest Communications, Inc. 8.38% 2005.............................. 105,000 104,737
Tele-Communications, Inc. 7.00% 1997................................. 200,000 202,704
Tele-Communications, Inc. 9.65% 2003................................. 150,000 169,005
Time Warner, Inc. 7.45% 1998......................................... 290,000 297,233
Time Warner, Inc. 7.98% 2004......................................... 200,000 209,960

Leisure & Tourism--0.5%
Blockbuster Entertainment Corp. 6.63% 1998........................... 130,000 130,917
-----------
1,114,556
-----------
INFORMATION TECHNOLOGY--3.2%

Communication Equipment--1.5%
Cablevision Industries Corp. 10.75% 2002............................. 420,000 454,650

Computers & Business Equipment--1.7%
Comdisco, Inc. 7.33% 1997............................................ 200,000 203,028
Comdisco, Inc. 9.75% 1997............................................ 275,000 286,148
-----------
943,826
-----------
MATERIALS--0.2%

Forest Products--0.2%
PT Indah Kiat Pulp & Paper Corp. 8.88% 2000.......................... 70,000 66,150
-----------
NON-U.S. GOVERNMENT OBLIGATIONS--3.7%

Foreign Government--3.7%
Petroleo Brasileiro SA 8.75% 1996(1)................................. 250,000 249,830
Quebec Province Canada 13.25% 2014................................... 290,000 367,865
Republic of Argentina Bote II 5.90% 1997(2).......................... 540,000 209,520
Republic of Columbia 9.25% 2000(1)................................... 250,000 252,060
-----------
1,079,275
-----------
U.S. GOVERNMENT & AGENCIES--51.2%

U.S. Government & Agencies--51.2%
Federal Home Loan Bank 8.59% 2000.................................... 70,000 70,218
Federal Home Loan Mortgage Corp. 6.83% 2002.......................... 150,000 152,554
Federal Home Loan Mortgage Corp. 7.00% TBA........................... 2,250,000 2,250,697
Federal Home Loan Mortgage Corp. 7.50% TBA........................... 1,000,000 1,017,810
Federal Home Loan Mortgage Corp. 8.20% 1998.......................... 110,000 113,180
</TABLE>

- ---------------------
8
<PAGE> 90
<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT & AGENCIES (continued)

Federal National Mortgage Association 7.00% TBA...................... $1,000,000 $1,011,560
Federal National Mortgage Association 8.79% 2002..................... 60,000 60,300
Government National Mortgage Association 7.50% TBA................... 1,000,000 1,020,620
Government National Mortgage Association 8.00% TBA................... 2,000,000 2,069,360
Government National Mortgage Association 9.50% TBA................... 1,000,000 1,070,000
United States Treasury Bonds 8.00% 2021.............................. 165,000 201,429
United States Treasury Bonds 8.75% 2020.............................. 440,000 576,057
United States Treasury Bonds 11.13% 2003@............................ 60,000 79,828
United States Treasury Bonds 13.75% 2004............................. 720,000 1,107,000
United States Treasury Bonds Strip zero coupon 2020@................. 1,220,000 251,198
United States Treasury Bonds Strip zero coupon 2004@................. 3,310,000 1,966,372
United States Treasury Notes 7.25% 2004.............................. 150,000 164,859
United States Treasury Notes 7.38% 1997.............................. 800,000 828,752
United States Treasury Notes 7.50% 1999.............................. 820,000 876,244
United States Treasury Notes 7.75% 2000.............................. 190,000 205,379
-----------
15,093,417
-----------
UTILITIES--0.5%

Electric Utilities--0.5%
Central Maine Power Co. 7.45% 1999................................... 155,000 161,423
-----------
TOTAL INVESTMENT SECURITIES (cost $28,206,756)....................... 28,718,327
-----------

SHORT-TERM SECURITIES--0.6%
------------------------------------------------------------------------------------------------
FOREIGN SHORT-TERM NOTES--0.6%
Petroleo Brasileiro 8.38% due 12/15/95............................... 120,000 119,622
Republic of Argentina 9.50% due 12/04/95............................. 70,000 70,000
-----------
TOTAL SHORT-TERM SECURITIES (cost $189,622).......................... 189,622
-----------

REPURCHASE AGREEMENTS--27.9%
------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS--27.9%
Agreement with Morgan Stanley Group, Inc., bearing interest of 5.87%
dated 11/30/95, to be repurchased 12/01/95 in the amount of
$5,000,815 and collateralized by $3,610,000 U.S. Treasury Bonds
13.375% due 8/15/01................................................ 5,000,000 5,000,000
Agreement with State Street Bank & Trust Co., bearing interest of
5.75% dated 11/30/95, to be repurchased 12/01/95 in the amount of
$3,212,513 and collateralized by $2,950,000 U.S. Treasury Notes
7.75% due 12/31/99@................................................ 3,212,000 3,212,000
-----------
TOTAL REPURCHASE AGREEMENTS (cost $8,212,000)........................ 8,212,000
-----------
TOTAL INVESTMENTS--
(cost $36,608,378) 125.9% 37,119,949
Liabilities in excess of other assets-- (25.9) (7,645,429)
----- -----------
NET ASSETS-- 100.0% $29,474,520
===== ===========
</TABLE>

-----------------------------

* Resale restricted to qualified institutional buyers

(1) Fair valued security; see Note 2

(2) Variable rate security; rate as of November 30, 1995

TBA-- Securities purchased on a forward commitment basis with an
approximate principal amount and no definitive maturity
date. The actual principal amount and maturity date will be
determined upon settlement.

---------------------

9
<PAGE> 91

@ The security or a portion thereof represents collateral for the
following open futures contracts:
<TABLE>
<CAPTION>
OPEN FUTURES CONTRACTS
UNREALIZED
NUMBER OF EXPIRATION VALUE AS OF APPRECIATION/
CONTRACTS DESCRIPTION DATE NOVEMBER 30, 1995 (DEPRECIATION)
--------- ----------- ---------- ----------------- --------------
<C> <S> <C> <C> <C>
2 Long 90 Day Euro Dollar................... December 1995 $ 471,300 $ 584
1 Long 90 Day Euro Dollar................... March 1996 236,700 1,417
1 Long 90 Day Euro Dollar................... June 1996 236,975 2,093
1 Long 90 Day Euro Dollar................... September 1996 236,950 2,417
1 Long 90 Day Euro Dollar................... December 1996 236,700 2,618
1 Long 90 Day Euro Dollar................... March 1997 236,650 2,643
17 Long U.S. Long Bond....................... December 1995 2,029,906 31,739
8 Long U.S. 5 Year Note..................... March 1996 877,000 3,189
8 Short U.S. 10 Year Note.................... March 1996 907,000 (6,811)
----------
Net Unrealized Appreciation................................................ $ 39,889
==========
</TABLE>

See Notes to Financial Statements

- ---------------------
10
<PAGE> 92

- ---------------------

SUNAMERICA SERIES TRUST
GLOBAL BOND PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(DENOMINATED IN
FOREIGN BONDS & NOTES--61.9% LOCAL CURRENCY) VALUE
------------------------------------------------------------------------------------------------------------
<CAPTION>
<S> <C> <C>
BELGIUM--2.8%
Kingdom of Belgium 6.50% 2005........................................ 50,000,000 $ 1,650,690
---------------
CANADA--7.0%
Government of Canada 7.50% 2000...................................... 5,500,000 4,178,138
---------------
DENMARK--7.6%
Kingdom of Denmark 8.00% 2006........................................ 16,000,000 2,968,654
Kingdom of Denmark 9.00% 2000........................................ 8,000,000 1,576,865
---------------
4,545,519
---------------
FRANCE--12.5%
Government of France 7.00% 1999...................................... 15,000,000 3,104,298
Government of France 8.25% 2004...................................... 10,000,000 2,184,150
Government of France 8.50% 2000...................................... 10,000,000 2,179,541
---------------
7,467,989
---------------
GERMANY--9.9%
Republic of Germany 7.13% 2002....................................... 5,500,000 4,072,807
Republic of Germany 7.38% 2005....................................... 2,500,000 1,862,338
---------------
5,935,145
---------------
JAPAN--4.1%
International Bank for Reconstruction & Development 6.75% 2001....... 150,000,000 1,839,066
Japan Development Bank 6.50% 2001.................................... 50,000,000 609,644
---------------
2,448,710
---------------
NEW ZEALAND--5.3%
Government of New Zealand 6.50% 2000................................. 5,000,000 3,185,676
---------------
SPAIN--4.7%
Government of Spain 10.00% 2005...................................... 350,000,000 2,807,269
---------------
SWEDEN--4.4%
Kingdom of Sweden 10.25% 2003........................................ 16,000,000 2,653,943
---------------
UNITED KINGDOM--3.6%
United Kingdom Treasury 8.50% 2005................................... 500,000 815,456
United Kingdom Treasury 9.00% 2000................................... 800,000 1,318,126
---------------
2,133,582
---------------
TOTAL FOREIGN BONDS & NOTES (cost $36,895,021)....................... 37,006,661
---------------

</TABLE>
---------------------
11

<PAGE> 93
<TABLE>
<CAPTION>
PRINCIPAL
U.S. GOVERNMENT AND AGENCIES--25.4% AMOUNT VALUE
------------------------------------------------------------------------------------------------------------
<S> <C> <C>
U.S. GOVERNMENT--25.4%
United States Treasury Notes 6.13% 2000.............................. $ 4,000,000 $ 4,093,760
United States Treasury Notes 6.25% 2000.............................. 2,000,000 2,055,940
United States Treasury Notes 6.25% 2003.............................. 1,250,000 1,291,213
United States Treasury Notes 6.50% 2005.............................. 1,000,000 1,052,340
United States Treasury Notes 6.88% 1999.............................. 1,500,000 1,566,795
United States Treasury Notes 7.88% 2004.............................. 4,500,000 5,146,875
---------------
TOTAL U.S. GOVERNMENT AND AGENCIES (cost $14,402,477)................ 15,206,923
---------------
TOTAL INVESTMENT SECURITIES (cost $51,297,498)....................... 52,213,584
---------------

SHORT-TERM SECURITIES--13.9%
------------------------------------------------------------------------------------------------------------
TIME DEPOSIT--13.9%
Cayman Island Time Deposit with State Street Bank & Trust Co.
5.69% due 12/01/95 (cost $8,281,000)............................... 8,281,000 8,281,000
---------------
TOTAL INVESTMENTS--
(cost $59,578,498) 101.2% 60,494,584
Liabilities in excess of other assets-- (1.2) (735,540)
----- ---------------
NET ASSETS-- 100.0% $59,759,044
===== ===============
</TABLE>

<TABLE>
<CAPTION>
OPEN FORWARD FOREIGN CURRENCY CONTRACTS
----------------------------------------------------------------------
GROSS
CONTRACT IN DELIVERY UNREALIZED
TO DELIVER EXCHANGE FOR DATE APPRECIATION
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BEF 47,612,500 USD 1,670,614 02/29/96 $ 61,513
CAD 5,648,199 USD 4,196,877 02/05/96 39,409
*CAD 3,622,085 USD 2,690,000 07/18/96 23,762
*DEM 410,000 USD 286,393 12/18/95 2,653
DEM 235,192 USD 164,286 12/18/95 1,522
DEM 3,524,199 USD 2,509,720 01/24/96 66,132
DEM 2,813,944 USD 1,994,588 01/24/96 43,472
DEM 2,181,899 USD 1,544,161 01/24/96 31,288
DEM 439,532 USD 314,603 01/24/96 9,843
DEM 4,166,640 USD 2,910,000 03/04/96 15,362
*DEM 4,570,000 FRF 16,111,992 01/31/96 68,746
*DEM 3,520,764 USD 2,459,321 12/18/95 24,996
DKK 5,417,250 USD 982,989 02/06/96 14,677
DKK 3,290,700 USD 606,357 02/06/96 18,158
DKK 17,230,222 USD 3,151,678 02/06/96 71,846
ESP 359,461,083 USD 2,943,447 02/27/96 52,638
FRF 38,645,000 USD 7,843,993 02/29/96 107,256
GBP 1,418,656 USD 2,193,951 12/11/95 22,581
*GBP 6,651 USD 10,288 12/11/95 104
*GBP 1,245,941 USD 1,926,848 12/11/95 19,406
*GBP 1,575,151 USD 2,435,971 12/11/95 24,533
JPY 6,728,231 USD 66,562 12/18/95 253
JPY 253,179,241 USD 2,519,196 12/18/95 24,035
JPY 238,248,062 USD 2,401,186 01/17/96 42,356
*JPY 271,285,433 USD 2,683,802 12/18/95 17,606
*JPY 171,663,221 USD 1,730,110 01/17/96 43,002
*JPY 168,692,852 USD 1,700,173 01/17/96 42,258
*USD 2,620,332 CAD 3,622,085 07/18/96 45,906
----------
935,313
----------
</TABLE>

- ---------------------

12
<PAGE> 94
<TABLE>
<CAPTION>
OPEN FORWARD FOREIGN CURRENCY CONTRACTS (continued)
----------------------------------------------------------------------
GROSS
CONTRACT IN DELIVERY UNREALIZED
TO DELIVER EXCHANGE FOR DATE DEPRECIATION
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BEF 79,681,869 DEM 3,862,801 09/09/96 $ (6,713)
*FRF 16,111,992 DEM 4,610,144 01/31/96 (40,989)
*JPY 29,663,500 DEM 410,000 12/18/95 (8,603)
*NZD 3,643,014 USD 2,351,930 12/12/95 (26,483)
SEK 17,893,529 USD 2,706,138 02/07/96 (7,983)
*USD 10,489 GBP 6,651 12/11/95 (306)
*USD 1,961,112 GBP 1,245,941 12/11/95 (53,669)
*USD 2,434,868 GBP 1,575,151 12/11/95 (23,431)
*USD 2,387,048 NZD 3,643,014 12/12/95 (8,636)
*USD 2,698,552 JPY 271,285,433 12/18/95 (32,356)
*USD 2,493,000 DEM 3,520,764 12/18/95 (58,675)
*USD 1,723,128 JPY 171,663,221 01/17/96 (36,021)
*USD 1,683,477 JPY 168,692,852 01/17/96 (25,562)
----------
(329,427)
----------
Net Unrealized Appreciation.................. $ 605,886
==========
</TABLE>

-----------------------------

* Represents open forward foreign currency contracts and
offsetting open forward foreign currency contracts that do not
have additional market risk but have continued counterparty
settlement risk.

<TABLE>
<S> <C> <C>
BEF--Belgian Franc ESP--Spanish Peseta NZD--New Zealand Dollar
CAD--Canadian Dollar FRF--French Franc SEK--Swedish Krona
DEM--Deutsche Mark GBP--Pound Sterling USD--United States
DKK--Danish Kroner JPY--Japanese Yen Dollar

</TABLE>

See Notes to Financial Statements

---------------------

13
<PAGE> 95

- ---------------------

SUNAMERICA SERIES TRUST
HIGH-YIELD BOND PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES--93.1% AMOUNT VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER DISCRETIONARY--4.9%

Retail--4.9%
County Seat Stores, Inc. 12.00% 2002................................. $1,000,000 $ 900,000
Hills Stores Co. 10.25% 2003......................................... 1,000,000 910,000
Thrifty PayLess Holdings, Inc. 12.25% 2004........................... 1,000,000 1,067,500
Thrifty PayLess Holdings, Inc. 12.25% 2004(1)........................ 1,000,000 1,135,000
-----------
4,012,500
-----------
CONSUMER STAPLES--8.6%

Food Retail--3.8%
Kash 'N Karry Food Stores, Inc. 11.50% 2003(2)....................... 2,135,400 2,167,431
Ralph's Supermarkets, Inc. 11.00% 2005............................... 1,000,000 960,000

Food, Beverage & Tobacco--1.1%
Specialty Foods Corp. 11.13% 2002.................................... 1,000,000 945,000

Household Products--3.7%
Herff Jones, Inc. 11.00% 2005*....................................... 2,000,000 2,100,000
Samsonite Corp. 11.13% 2005.......................................... 1,000,000 940,000
-----------
7,112,431
-----------
ENERGY--0.5%

Energy Services--0.5%
DeepTech International, Inc. 12.00% 2000............................. 500,000 437,500
-----------
FINANCE--2.0%

Financial Services--0.7%
Olympic Financial Ltd. 13.00% 2000................................... 500,000 540,000

Insurance--1.3%
Terra Nova Insurance United Kingdom Holdings PLC 10.75% 2005......... 1,000,000 1,080,000
-----------
1,620,000
-----------
HEALTHCARE--17.4%

Health Services--12.9%
Abbey Healthcare Group, Inc. 9.50% 2002.............................. 2,000,000 2,120,000
OrNda Healthcorp 12.25% 2002......................................... 2,000,000 2,190,000
Quorum Health Group, Inc. 8.75% 2005................................. 2,000,000 2,015,000
Tenet Healthcare Corp. 8.63% 2003.................................... 2,000,000 2,065,000
Tenet Healthcare Corp. 10.13% 2005................................... 2,000,000 2,170,000

Medical Products--4.5%
Amerisource Distribution Corp. 11.25% 2005........................... 1,028,125 1,115,516
Dade International, Inc. 13.00% 2005................................. 500,000 553,750
Ivac Corp. 9.25% 2002................................................ 2,000,000 2,035,000
-----------
14,264,266
-----------
INDUSTRIAL & COMMERCIAL--6.0%

Business Services--2.7%
Katz Corp. 12.75% 2002............................................... 1,000,000 1,107,500
United Stationers Supply Co. 12.75% 2005............................. 1,000,000 1,080,000

Multi-Industry--2.3%
International Semi-Tech Microelectronic, Inc. zero coupon 2003(3).... 2,000,000 1,030,000
J.B. Poindexter & Co. 12.50% 2004(4)................................. 1,000,000 850,000
</TABLE>

- ---------------------

14
<PAGE> 96

<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
INDUSTRIAL & COMMERCIAL (continued)

Transportation--1.0%
USAir, Inc. 10.00% 2003.............................................. $1,000,000 $ 846,250
-----------
4,913,750
-----------
INFORMATION & ENTERTAINMENT--28.6%

Broadcasting & Media--18.5%
Argyle Television, Inc. 9.75% 2005................................... 1,000,000 986,250
Bell Cablemedia PLC zero coupon 2005*(3)............................. 2,000,000 1,210,000
Century Communications Corp. 11.88% 2003............................. 2,000,000 2,140,000
Comcast UK Cable Partners Ltd. zero coupon 2007(3)................... 1,000,000 570,000
International CableTel, Inc. zero coupon 2005(3)..................... 1,000,000 610,000
Lenfest Communications, Inc. 8.38% 2005.............................. 1,500,000 1,496,250
NWCG Holding Corp. zero coupon 1999.................................. 3,000,000 2,006,250
Simmons Cable Co. 15.75% 1996(4)..................................... 2,000,000 1,047,500
Sinclair Broadcast Group, Inc. 10.00% 2005........................... 2,000,000 2,045,000
Telewest PLC zero coupon 2007(3)..................................... 1,875,000 1,087,500
United International Holdings, Inc. zero coupon 1999................. 1,750,000 1,025,937
Videotron Holdings PLC zero coupon 2005(3)........................... 1,700,000 1,003,000

Leisure & Tourism--10.1%
Bally's Park Place Funding, Inc. 9.25% 2004.......................... 1,000,000 997,500
Grand Casino, Inc. 10.13% 2003....................................... 1,500,000 1,533,750
Hammons John Q Hotels LP 9.75% 2005*................................. 1,000,000 1,003,750
HMH Properties, Inc. 9.50% 2005...................................... 2,000,000 2,015,000
Players International, Inc. 10.88% 2005.............................. 1,000,000 950,000
Santa Fe Hotel, Inc. 11.00% 2000..................................... 907,000 634,900
Showboat, Inc. 13.00% 2009........................................... 1,000,000 1,110,000
-----------
23,472,587
-----------
INFORMATION TECHNOLOGY--11.8%

Telecommunications--11.8%
Cellular Communications International, Inc. zero coupon 2000(1)...... 2,000,000 1,165,000
Comcast Cellular Corp. zero coupon 2000.............................. 1,500,000 1,147,500
Echostar Communications Corp. zero coupon 2004(1)(3)................. 1,000,000 690,000
In Flight Phone Corp. zero coupon 2002*(3)........................... 1,000,000 350,000
Mobile Telecommunication Technologies Corp. 13.50% 2002.............. 1,000,000 1,137,500
Mobilemedia Corp. 9.38% 2007......................................... 1,000,000 1,007,500
Paging Network, Inc. 11.75% 2002..................................... 1,000,000 1,102,500
PanAmSat, L.P. zero coupon 2003(3)................................... 2,500,000 2,012,500
Pricecellular Wireless Corp. zero coupon 2003(3)..................... 1,500,000 1,117,500
-----------
9,730,000
-----------
MATERIALS--13.3%

Chemicals--10.7%
Acetex Corp. 9.75% 2003*............................................. 1,000,000 1,023,750
Agriculture Minerals & Chemicals 10.75% 2003......................... 1,000,000 1,090,000
Arcadian Partners L.P. 10.75% 2005................................... 1,000,000 1,095,000
G I Holdings, Inc. zero coupon 1998.................................. 2,000,000 1,520,000
LaRoche Industries, Inc. 13.00% 2004................................. 2,000,000 2,120,000
OSI Specialties Holdings Co. zero coupon 2004(3)..................... 1,000,000 875,260
Terra Industries 10.50% 2005......................................... 1,000,000 1,090,000

Forest Products--1.3%
Stone Container Corp. 11.88% 1998.................................... 1,000,000 1,055,000
</TABLE>

---------------------

15
<PAGE> 97
<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
-----------------------------------------------------------------------------------------------
<S> <C> <C>
MATERIALS (continued)

Metals & Minerals--1.3%
Renco Metals, Inc. 12.00% 2000....................................... $1,000,000 $ 1,080,000
-----------
10,949,010
-----------
TOTAL BONDS & NOTES (cost $75,802,446)............................... 76,512,044
-----------

COMMON STOCK--0.0% SHARES
-----------------------------------------------------------------------------------------------
CONSUMER STAPLES--0.0%

Food Retail--0.0%
Smitty's Supermarkets, Inc. ......................................... 500 3,250
-----------
INFORMATION & ENTERTAINMENT--0.0%

Leisure & Tourism--0.0%
Capital Gaming International, Inc. .................................. 40,000 2,500
-----------
TOTAL COMMON STOCK (cost $156,260)................................... 5,750
-----------

PREFERRED STOCK--1.3%
-----------------------------------------------------------------------------------------------
MATERIALS--1.3%

Forest Products--1.3%
SDW Holdings Corp.(1)(4) (cost $1,000,554)........................... 3,700 1,073,000
-----------

WARRANTS--0.1%+
-----------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--0.0%

Housing--0.0%
NVR, Inc. ........................................................... 6,857 14,571
-----------
CONSUMER STAPLES--0.0%

Household Products--0.0%
Chattem, Inc.*....................................................... 1,000 2,875
-----------
INFORMATION & ENTERTAINMENT--0.1%

Broadcasting & Media--0.0%
United International Holdings, Inc. ................................. 1,750 4,200
Leisure & Tourism--0.1%
Casino Magic Finance Corp. .......................................... 6,000 2,775
Fitzgerald Gaming Corp.(4)........................................... 2,000 20,000
-----------
26,975
-----------
</TABLE>

- ---------------------
16
<PAGE> 98

<TABLE>
<CAPTION>
WARRANTS (continued) SHARES VALUE
-----------------------------------------------------------------------------------------------
<S> <C> <C>
INFORMATION TECHNOLOGY--0.0%

Telecommunications--0.0%
In Flight Phone Corp................................................. 1,000 $ 0
-----------
TOTAL WARRANTS (cost $10,558)........................................ 44,421
-----------
TOTAL INVESTMENT SECURITIES (cost $76,969,818)....................... 77,635,215
-----------
TOTAL INVESTMENTS--
(cost $76,969,818) 94.5% 77,635,215
Other assets less liabilities-- 5.5 4,538,452
----- -----------
NET ASSETS-- 100.0% $82,173,667
===== ===========

</TABLE>

-----------------------------

+ Non-income producing securities

* Resale restricted to qualified institutional buyers

(1) Consists of more than one class of securities traded together
as a unit; generally bonds with attached stocks or warrants

(2) PIK ("Payment-in-Kind") payment made with additional
securities in lieu of cash

(3) Represents a zero coupon bond which will convert to an
interest-bearing security at a later date

(4) Fair valued security; see Note 2

See Notes to Financial Statements

---------------------

17
<PAGE> 99

- ---------------------

SUNAMERICA SERIES TRUST
WORLDWIDE HIGH INCOME
PORTFOLIO I INVESTMENT PORTFOLIO--NOVEMBER 30, 1995

<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES--96.1% AMOUNT VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER DISCRETIONARY--8.4%

Apparel & Textiles--2.3%
Westpoint Stevens, Inc. 9.38% 2005................................... $ 500,000 $ 502,500

Housing--6.1%
Companhia Brasileira de Petroleo Ipiranga 12.50% 1997*(5)............ 500,000 492,500
Minas Gerais 8.25% 2000.............................................. 1,000,000 817,500
----------
1,812,500
----------
CONSUMER STAPLES--13.5%

Food, Beverage & Tobacco--13.5%
Empresas La Moderna 10.25% 1997...................................... 1,000,000 961,875
Fomento Economico Mexicano 9.50% 1997................................ 1,000,000 972,500
Grupo Embatellador de Mexico 10.75% 1997............................. 1,000,000 977,500
----------
2,911,875
----------
FINANCE--9.4%

Banks--9.4%
Banamex Pagare 14.52% 1997........................................MXN 6,446,250 433,828
Banco De Galicia Y Buenos Aires 9.00% 2003........................... 1,500,000 1,239,375
Central Bank of Nigeria 6.25% 2020................................... 750,000 352,500
----------
2,025,703
----------
INDUSTRIAL & COMMERCIAL--9.2%

Business Services--2.3%
Norcal Waste Systems, Inc. 12.50% 2005*(2)........................... 500,000 500,000

Multi-Industry--4.0%
Iochpe Maxion SA 12.38% 2002......................................... 500,000 430,000
Iochpe Maxion SA 12.38% 2002*(5)..................................... 500,000 430,000

Transportation--2.9%
Southland Corp. 5.00% 2003........................................... 750,000 624,375
----------
1,984,375
----------
INFORMATION & ENTERTAINMENT--5.8%

Broadcasting & Media--3.4%
Continental Cablevision, Inc. 9.50% 2013............................. 200,000 210,500
Marvel Parent Holdings, Inc. zero coupon 1998........................ 300,000 210,000
Viacom, Inc. 8.00% 2006.............................................. 300,000 301,500

Leisure & Tourism--2.4%
Six Flags Theme Parks, Inc. zero coupon 2005*(1)..................... 675,000 524,813
----------
1,246,813
----------
INFORMATION TECHNOLOGY--7.4%

Telecommunications--7.4%
Telecom Argentina 12.00% 2002*(5).................................... 800,000 825,000
Tolmex SA de CV 8.38% 2003........................................... 1,000,000 758,750
----------
1,583,750
----------
</TABLE>

- ---------------------
18
<PAGE> 100
<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
MATERIALS--17.5%

Chemicals--5.4%
Petroleos Mexicanos 8.63% 2023*...................................... $1,000,000 $ 703,750
Plastic Specialty & Technology, Inc. 11.25% 2003..................... 500,000 452,500

Forest Products--3.4%
Owens Illinois, Inc. 9.75% 2004...................................... 500,000 520,000
Stone Container Corp. 10.75% 2002.................................... 200,000 205,250

Metals & Minerals--8.7%
Algoma Steel, Inc. 12.38% 2005....................................... 500,000 438,750
Hylsa SA de Cv 11.00% 1998........................................... 1,000,000 965,000
Sheffield Steel Corp. 12.00% 2001(3)................................. 500,000 470,000
-----------
3,755,250
-----------
NON-U.S. GOVERNMENT OBLIGATIONS--11.9%

Foreign Government--11.9%
Federal Republic of Brazil 8.00% 2014(4)............................. 265,302 140,278
Federal Republic of Brazil 6.81% 2006(2)............................. 250,000 164,843
Republic of Bulgaria 6.75% 2024(2)................................... 750,000 379,688
Republic of Ecuador 6.81% 2015(4).................................... 1,021,486 334,537
Republic of Ecuador 6.81% 2025(2).................................... 1,400,000 682,500
Republic of Poland 3.75% 2014........................................ 1,350,000 867,375
-----------
2,569,221
-----------
UTILITIES--13.0%

Electric Utilities--0.7%
Columbia Gas Systems, Inc. 6.39% 2000................................ 23,000 23,151
Columbia Gas Systems, Inc. 6.61% 2002................................ 20,000 20,181
Columbia Gas Systems, Inc. 6.80% 2005................................ 20,000 20,214
Columbia Gas Systems, Inc. 7.05% 2007................................ 20,000 19,935
Columbia Gas Systems, Inc. 7.32% 2010................................ 20,000 20,053
Columbia Gas Systems, Inc. 7.42% 2015................................ 20,000 19,875
Columbia Gas Systems, Inc. 7.62% 2025................................ 20,000 19,850

Gas & Pipeline Utilities--12.3%
Bridas Corp. 12.50% 1999............................................. 1,500,000 1,452,187
Metrogas SA 12.00% 2002*............................................. 300,000 294,000
Transportadora de Gas Del Sur 7.75% 1998............................. 1,000,000 912,500
-----------
2,801,946
-----------
TOTAL BONDS & NOTES (cost $20,307,397)............................... 20,691,433
-----------

COMMON STOCK--0.1% SHARES
------------------------------------------------------------------------------------------------
UTILITIES--0.1%

Electric Utilities--0.1%
Columbia Gas Systems, Inc. (cost $8,775)............................. 351 14,215
-----------
PREFERRED STOCK--0.1%
------------------------------------------------------------------------------------------------
UTILITIES--0.1%

Electric Utilities--0.1%
Columbia Gas Systems, Inc. (cost $14,325)............................ 573 14,039
-----------
</TABLE>

---------------------

19
<PAGE> 101
<TABLE>
<CAPTION>
WARRANTS--0.0%+ SHARES VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
FINANCE--0.0%

Banks--0.0%
Central Bank of Nigeria (cost $0).................................... 750 $ 0
-----------
TOTAL INVESTMENT SECURITIES (cost $20,330,497)....................... 20,719,687
-----------

PRINCIPAL
REPURCHASE AGREEMENT--6.7% AMOUNT
------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--6.7%

Agreement with State Street Bank & Trust Co., bearing interest of
4.50% dated 11/30/95, to be repurchased 12/01/95 in the amount of
$1,434,179 and collateralized by $1,013,000 U.S. Treasury Bonds
12.00% due 5/15/05 (cost $1,434,000)............................... $1,434,000 1,434,000
-----------
TOTAL INVESTMENTS--
(cost $21,764,497) 103.0% 22,153,687
Liabilities in excess of other assets-- (3.0) (638,607)
----- -----------
NET ASSETS-- 100.0% $21,515,080
===== =============

</TABLE>

-----------------------------

+ Non-income producing securities

* Resale restricted to qualified institutional buyers

(1) Represents a zero coupon bond which will convert to an
interest-bearing security at a later date

(2) Variable rate security; rate as of November 30, 1995

(3) Consists of more than one class of securities traded together
as a unit; generally bonds with attached stocks or warrants

(4) A portion of the coupon interest is received in cash and a
portion is capitalized in the principal of the security

(5) Fair valued security; see Note 2

MXN Mexican Peso

Allocation of net assets by country as of November 30, 1995:

<TABLE>
<S> <C>
Mexico 31.0%
United States 30.7
Argentina 17.7
Brazil 11.5
Ecuador 4.7
Poland 4.0
Bulgaria 1.8
Nigeria 1.6
</TABLE>

See Notes to Financial Statements

- ---------------------

20
<PAGE> 102

- ---------------------

SUNAMERICA SERIES TRUST
BALANCED/PHOENIX INVESTMENT
COUNSEL PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--50.2% SHARES VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER DISCRETIONARY--2.2%

Retail--2.2%
General Nutrition Cos., Inc.+........................................ 10,000 $ 221,250
Nine West Group, Inc. ............................................... 3,000 133,125
Office Depot, Inc.+.................................................. 7,500 183,750
Staples, Inc.+....................................................... 7,000 178,500
-----------
716,625
-----------
CONSUMER STAPLES--3.4%

Food, Beverage & Tobacco--2.2%
Nabisco Holdings Corp. .............................................. 7,000 197,750
Northland Cranberries, Inc. ......................................... 12,500 237,500
Philip Morris Cos., Inc. ............................................ 3,300 289,575

Household Products--1.2%
Estee Lauder Cos., Inc. ............................................. 1,000 36,375
Gillette Co. ........................................................ 2,000 103,750
Newell Co. .......................................................... 2,500 65,938
Procter & Gamble Co. ................................................ 2,000 172,750
-----------
1,103,638
-----------
ENERGY--3.9%

Energy Services--3.2%
British Petroleum PLC ADR............................................ 1,500 143,438
ENSCO International, Inc. ........................................... 10,000 168,750
Halliburton Co. ..................................................... 3,500 151,813
Mobil Corp. ......................................................... 1,500 156,562
Sonat Offshore Drilling, Inc. ....................................... 5,000 172,500
Western Atlas, Inc.+................................................. 5,000 239,375

Energy Sources--0.7%
Fluor Corp. ......................................................... 3,500 227,500
-----------
1,259,938
-----------
FINANCE--7.2%

Banks--1.0%
Amsouth Bancorp. .................................................... 2,200 87,175
Chase Manhattan Corp. ............................................... 4,000 243,500

Financial Services--2.9%
American Express Co. ................................................ 4,000 170,000
Donaldson Lufkin & Jenrette, Inc. ................................... 2,000 66,500
Equifax, Inc. ....................................................... 2,800 117,250
Federal National Mortgage Association................................ 500 54,750
First Data Corp. .................................................... 2,500 177,500
Great Western Financial Corp. ....................................... 6,500 165,750
Travelers Group, Inc. ............................................... 3,000 178,500

Insurance--3.3%
Allstate Corp. ...................................................... 3,500 143,500
Cigna Corp. ......................................................... 2,500 275,000
ITT Corp. ........................................................... 2,000 245,250
</TABLE>

---------------------

21
<PAGE> 103

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
FINANCE (continued)

Insurance (continued)
MGIC Investment Corp. ............................................... 3,500 $ 194,687
Prudential Reinsurance Holdings, Inc. ............................... 10,000 208,750
-----------
2,328,112
-----------
HEALTHCARE--5.6%

Drugs--2.9%
American Home Products Corp. ........................................ 1,500 136,875
Amgen, Inc.+......................................................... 2,500 124,063
Biogen, Inc.+........................................................ 2,500 136,250
Manor Care, Inc. .................................................... 6,000 195,750
Nationwide Health Properties, Inc. .................................. 4,500 178,875
Watson Pharmaceuticals, Inc.+........................................ 3,500 164,937

Health Services--1.2%
Pharmacia & Upjohn, Inc.+............................................ 6,525 234,084
United Healthcare Corp. ............................................. 2,500 157,188

Medical Products--1.5%
Baxter International, Inc. .......................................... 6,500 273,000
Johnson & Johnson Co. ............................................... 2,000 173,250
Medtronic, Inc. ..................................................... 1,000 54,875
-----------
1,829,147
-----------
INDUSTRIAL & COMMERCIAL--3.8%

Aerospace & Military Technology--0.6%
Boeing Co. .......................................................... 2,500 182,188

Business Services--0.4%
Manpower, Inc. ...................................................... 5,000 133,750

Electrical Equipment--1.6%
Adtran, Inc.+........................................................ 2,600 127,400
General Electric Co. ................................................ 4,000 269,000
United Technologies Corp. ........................................... 1,500 140,625

Machinery--1.2%
BJ Services Co.+..................................................... 7,500 184,687
Case Corp. .......................................................... 5,000 208,750
-----------
1,246,400
-----------
INFORMATION & ENTERTAINMENT--2.2%

Broadcasting & Media--1.0%
Tele-Communications TCI Group+....................................... 6,500 120,250
Viacom, Inc.+........................................................ 4,500 217,125

Leisure & Tourism--1.2%
Disney (Walt) Co. ................................................... 3,500 210,438
Red Lion Hotels, Inc. ............................................... 9,000 159,750
-----------
707,563
-----------
INFORMATION TECHNOLOGY--11.2%

Communication Equipment--1.3%
Ericsson (L.M.) Telephone Co. ADR.................................... 6,000 142,500
SBC Communications, Inc. ............................................ 5,000 270,000

Computers & Business Equipment--4.0%
Bay Networks, Inc.+.................................................. 16,000 720,000
Digital Equipment Corp. ............................................. 3,000 176,625
StrataCom, Inc.+..................................................... 2,000 150,000
Sun Microsystems, Inc.+.............................................. 3,000 252,375
</TABLE>

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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
------------------------------------------------------------------------------------------------
<S> <C> <C>
INFORMATION TECHNOLOGY (continued)

Electronics--0.7%
Maxim Integrated Products, Inc.+..................................... 3,000 $ 225,000

Software--3.5%
BBN Corp. ........................................................... 6,000 225,000
Cisco Systems, Inc.+................................................. 2,500 210,312
Oracle Systems Corp.+................................................ 6,000 272,250
Visio Corp. ......................................................... 16,000 428,000

Telecommunications--1.7%
Ameritech Corp. ..................................................... 5,000 275,000
AT&T Corp. .......................................................... 4,500 297,000
-----------
3,644,062
-----------
MATERIALS--4.4%

Chemicals--3.9%
Arcadian Corp. ...................................................... 17,000 352,750
Grace (W.R.) & Co. .................................................. 2,000 121,500
IMC Global, Inc. .................................................... 2,000 154,750
Monsanto Co. ........................................................ 2,500 286,250
Potash Corp. Saskatchewan, Inc. ..................................... 2,000 138,250
United Waste Systems, Inc.+.......................................... 5,000 199,375

Forest Products--0.5%
Kimberly-Clark Corp. ................................................ 2,100 161,437
-----------
1,414,312
-----------
REAL ESTATE--1.2%

Real Estate Investment Trusts--1.2%
Equity Residential Properties Trust.................................. 5,500 170,500
Patriot American Hospitality, Inc.+.................................. 8,500 201,875
-----------
372,375
-----------
UTILITIES--5.1%

Electric Utilities--3.4%
Allegheny Power Systems, Inc. ....................................... 5,000 138,750
FPL Group, Inc.+..................................................... 5,000 216,875
Pinnacle West Capital Corp. ......................................... 4,500 122,625
Texas Utilities Co. ................................................. 7,000 269,500
Unicom Corp. ........................................................ 11,000 352,000

Telephone--1.7%
MCI Communications Corp. ............................................ 10,000 267,500
US West, Inc. ....................................................... 9,000 281,250
-----------
1,648,500
-----------
TOTAL COMMON STOCK (cost $14,758,167)................................ 16,270,672
-----------

PREFERRED STOCK--0.4%
------------------------------------------------------------------------------------------------

Forest Products--0.4%
Alco Standard Corp. (cost $116,063).................................. 1,500 124,875
-----------

PRINCIPAL
BONDS & NOTES--37.0% AMOUNT
------------------------------------------------------------------------------------------------

CONSUMER DISCRETIONARY--3.0%

Apparel & Textiles--2.2%
Westpoint Stevens, Inc. 9.38% 2005................................... $ 700,000 703,500
</TABLE>

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23
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<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
<S> <C> <C>
------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY (continued)

Retail--0.8%
Federated Department Stores, Inc. 5.00% 2003......................... $ 250,000 $ 261,250
-----------
964,750
-----------
CONSUMER STAPLES--0.8%

Food, Beverage & Tobacco--0.8%
Boston Chicken, Inc. 4.50% 2004...................................... 200,000 255,000
-----------
FINANCE--3.6%

Financial Services--3.6%
CS First Boston Mortgage Securities Corp. CMO 7.18% 2027(1).......... 300,000 301,781
Resolution Trust Corp. CMO 6.02% 2027................................ 236,702 235,000
Sandoz Capital BVI Ltd. 2.00% 2002*.................................. 350,000 323,969
Structured Asset Securities Corp. 7.00% 2026(1)...................... 300,000 301,313
-----------
1,162,063
-----------
INDUSTRIAL & COMMERCIAL--1.5%

Business Services--0.6%
ADT Operations, Inc. zero coupon 2010................................ 400,000 188,000

Transportation--0.9%
Delta Air Lines, Inc. 3.23% 2003..................................... 300,000 303,750
-----------
491,750
-----------
MUNICIPAL BONDS--1.4%

Municipal Bonds--1.4%
Florida State Board of Education Capital Outlay 5.25% 2023........... 50,000 48,376
Intermountain Power Agency Utah 5.00% 2023........................... 50,000 45,742
Kern County California Pension Obligation 7.26% 2014................. 50,000 50,555
Long Beach California Pension Obligation 6.87% 2006.................. 30,000 30,659
Miami Beach Florida Special Obligation 8.60% 2021.................... 100,000 112,633
New York State Power Authority Revenue 5.25% 2018.................... 25,000 24,267
Northern California Power Agency Public Power Revenue 5.50% 2024..... 50,000 49,219
San Bernardino County California Financing Authority 6.87% 2008...... 15,000 15,278
San Bernardino County California Financing Authority 6.94% 2009...... 35,000 35,583
South Carolina State Public Service Authority 5.00% 2025............. 40,000 37,167
South Carolina State Public Service Authority 5.13% 2021............. 20,000 18,625
-----------
468,104
-----------
NON-U.S. GOVERNMENT OBLIGATIONS--1.3%

Foreign Government--1.3%
Government of Poland 2.75% 2024...................................... 500,000 219,375
Republic of the Philippines 5.75% 2017............................... 280,000 207,900
-----------
427,275
-----------
U.S. GOVERNMENT & AGENCIES--25.4%

U.S. Government & Agencies--25.4%
Government National Mortgage Association 6.50% 2023.................. 293,609 288,286
United States Treasury Bonds 7.63% 2025.............................. 150,000 178,430
United States Treasury Notes 5.13% 1998.............................. 600,000 596,436
United States Treasury Notes 5.75% 2000.............................. 350,000 352,954
United States Treasury Notes 6.25% 2000.............................. 350,000 359,790
United States Treasury Notes 6.50% 2005.............................. 1,730,000 1,820,012
United States Treasury Notes 6.75% 1997.............................. 650,000 660,458
United States Treasury Notes 6.75% 2000.............................. 1,200,000 1,256,064
United States Treasury Notes 6.88% 2000.............................. 450,000 473,134
United States Treasury Notes 7.13% 2000.............................. 150,000 158,859
United States Treasury Notes 7.25% 1996.............................. 250,000 254,297
United States Treasury Notes 7.50% 1996.............................. 200,000 204,344
</TABLE>

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<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
<S> <C> <C>
------------------------------------------------------------------------------------------------
U.S. GOVERNMENT & AGENCIES (continued)

United States Treasury Notes 7.50% 2005.............................. $ 850,000 $ 952,000
United States Treasury Notes 7.88% 2004.............................. 600,000 686,250
-----------
8,241,314
-----------
TOTAL BONDS & NOTES (cost $11,568,301)............................... 12,010,256
-----------
TOTAL INVESTMENT SECURITIES (cost $26,442,531)....................... 28,405,803
-----------
SHORT-TERM SECURITIES--19.2%
------------------------------------------------------------------------------------------------

CORPORATE SHORT-TERM NOTES--16.9%

Albertson's, Inc. 5.70% due 12/14/95................................. 500,000 498,971
Campbell Soup Co. 5.69% due 12/29/95................................. 590,000 587,389
du Pont (E.I.) de Nemours & Co. 5.71% due 12/05/95................... 490,000 489,689
Goldman Sachs Group L.P. 5.73% due 12/14/95.......................... 500,000 498,965
Heinz (H.J.) Co. 5.72% due 12/01/95.................................. 110,000 110,000
Merrill Lynch & Co. 5.78% due 12/11/95............................... 455,000 454,270
Minnesota Mining & Manufacturing Co. 5.72% due 12/06/95.............. 600,000 599,523
Philip Morris Cos., Inc. 5.73% due 12/04/95.......................... 170,000 169,919
Shell Oil Co. 5.66% due 12/15/95..................................... 510,000 508,877
TDK USA Corp. 5.72% due 12/18/95..................................... 625,000 623,312
TDK USA Corp. 5.74% due 1/17/96...................................... 375,000 372,190
Wal-Mart Stores, Inc. 5.70% due 12/01/95............................. 570,000 570,000
-----------
5,483,105
-----------
FEDERAL AGENCY OBLIGATIONS--2.3%

Federal Home Loan Mortgage Discount Notes 5.70% due 12/19/95......... 760,000 757,834
-----------
TOTAL SHORT-TERM SECURITIES (cost $6,240,939)........................ 6,240,939
-----------
TOTAL INVESTMENTS--
(cost $32,683,470) 106.8% 34,646,742
Liabilities in excess of other assets-- (6.8) (2,218,207)
------ ------------
NET ASSETS-- 100.0% $ 32,428,535
====== ============
</TABLE>

-----------------------------

+ Non-income producing securities

* Resale restricted to qualified institutional buyers

(1) Fair valued security; see Note 2

ADR--American Depositary Receipt

CMO--Collateralized Mortgage Obligation

See Notes to Financial Statements

---------------------

25
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SUNAMERICA SERIES TRUST
ASSET ALLOCATION PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--61.0% SHARES VALUE
<S> <C> <C>
---------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--8.5%

Apparel & Textiles--0.6%
Melville Corp. ...................................................... 38,700 $ 1,204,538

Automotive--3.5%
Ford Motor Co. ...................................................... 121,400 3,429,550
General Motors Corp. ................................................ 19,800 960,300
Goodyear Tire & Rubber Co. .......................................... 60,400 2,559,450

Housing--1.1%
Centex Corp. ........................................................ 30,600 1,005,975
Lennar Corp. ........................................................ 58,100 1,285,462

Retail--3.3%
Fleming Cos., Inc. .................................................. 95,800 2,215,375
Penney (J.C.), Inc. ................................................. 48,900 2,292,187
Sears, Roebuck & Co. ................................................ 52,100 2,051,438
------------
17,004,275
------------
CONSUMER STAPLES--8.3%

Food, Beverage & Tobacco--7.7%
Anheuser-Busch Cos., Inc. ........................................... 43,600 2,888,500
Chiquita Brands International, Inc. ................................. 204,800 2,739,200
Philip Morris Cos., Inc. ............................................ 44,900 3,939,975
RJR Nabisco Holdings Corp. .......................................... 112,240 3,268,990
Supervalu, Inc. ..................................................... 78,200 2,521,950

Household Products--0.6%
Sunbeam Corp., Inc. ................................................. 80,800 1,313,000
------------
16,671,615
------------
ENERGY--7.2%

Energy Services--5.3%
Ashland, Inc. ....................................................... 85,500 2,981,812
CMS Energy Corp. .................................................... 43,500 1,185,375
Mobil Corp. ......................................................... 11,800 1,231,625
Texaco, Inc. ........................................................ 35,100 2,597,400
Tosco Corp. ......................................................... 70,800 2,699,250

Energy Sources--1.9%
Atlantic Richfield Co. .............................................. 12,600 1,365,525
Royal Dutch Petroleum Co. ADR........................................ 19,000 2,439,125
------------
14,500,112
------------
FINANCE--10.8%

Banks--4.2%
BankAmerica Corp. ................................................... 32,100 2,042,362
NationsBank Corp. ................................................... 56,000 3,997,000
Shawmut National Corp. .............................................. 35,400 1,327,500
Standard Federal Bancorp. ........................................... 25,500 978,563

Financial Services--1.8%
Greenpoint Financial Corp. .......................................... 55,900 1,467,375
Lehman Brothers Holdings, Inc. ...................................... 36,800 832,600
Travelers Group, Inc. ............................................... 23,300 1,386,350
</TABLE>

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26
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
FINANCE (continued)

Insurance--4.8%
Allstate Corp. ...................................................... 32,300 $ 1,324,300
Cigna Corp. ......................................................... 10,700 1,177,000
Integon Corp. ....................................................... 15,100 256,700
Lincoln National Corp. .............................................. 54,100 2,529,175
Partner Residential Holding Corp. ................................... 81,000 2,146,500
Reliastar Financial Corp. ........................................... 44,200 1,911,650
USLIFE Corp. ........................................................ 6,750 194,906
-----------
21,571,981
-----------
HEALTHCARE--2.3%

Health Services--2.3%
Columbia/HCA Healthcare Corp. ....................................... 28,900 1,491,963
Tenet Healthcare Corp. .............................................. 169,500 3,029,812
-----------
4,521,775
-----------
INDUSTRIAL & COMMERCIAL--9.9%

Aerospace & Military Technology--6.3%
AMR Corp.+........................................................... 8,000 613,000
Lear Seating Corp. .................................................. 60,000 1,680,000
Lockheed Martin Corp. ............................................... 31,800 2,333,325
Loral Corp. ......................................................... 52,200 1,768,275
McDonnell Douglas Corp. ............................................. 44,800 3,992,800
Northrop Grumman Corp. .............................................. 35,800 2,201,700

Machinery--0.8%
Outboard Marine Corp. ............................................... 77,800 1,594,900

Manufacturing--1.3%
Owens Illinois, Inc. ................................................ 195,200 2,537,600

Transportation--1.5%
Consolidated Freightways, Inc.+...................................... 113,900 2,989,875
-----------
19,711,475
-----------
INFORMATION & ENTERTAINMENT--2.6%

Broadcasting & Media--1.1%
Tele-Communications TCI Group+....................................... 114,300 2,114,550

Leisure & Tourism--1.5%
Brunswick Corp. ..................................................... 140,200 2,996,775
-----------
5,111,325
-----------
INFORMATION TECHNOLOGY--2.8%

Computers & Business Equipment--2.0%
Apple Computer, Inc. ................................................ 23,600 899,750
COMPAQ Computer Corp.+............................................... 37,000 1,831,500
Storage Technology Corp. ............................................ 49,800 1,232,550

Telecommunications--0.8%
Valassis Communications, Inc. ....................................... 106,900 1,643,588
-----------
5,607,388
-----------
MATERIALS--6.5%

Chemicals--0.9%
Geon Co. ............................................................ 72,200 1,786,950

Forest Products--5.3%
Champion International Corp. ........................................ 36,900 1,738,913
Georgia-Pacific Corp. ............................................... 54,200 4,214,050
Stone Container Corp.+............................................... 229,500 3,585,937
Universal Corp. ..................................................... 46,800 1,111,500
</TABLE>

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27
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
MATERIALS (continued)
Metals & Minerals--0.3%
Quanex Corp. ........................................................ 28,300 $ 555,387
-----------
12,992,737
-----------
UTILITIES--2.1%

Electric Utilities--2.1%
Entergy Corp. ....................................................... 63,800 1,778,425
Long Island Lighting Co. ............................................ 145,100 2,484,838
-----------
4,263,263
-----------
TOTAL COMMON STOCK (cost $106,062,453)............................... 121,955,946
-----------
PRINCIPAL
BONDS & NOTES--32.8% AMOUNT
--------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--0.4%

Housing--0.4%
News America Holdings, Inc. 7.50% 2000............................... $ 600,000 627,708
News America Holdings, Inc. 9.13% 1999............................... 250,000 275,437
-----------
903,145
-----------
CONSUMER STAPLES--0.3%

Food, Beverage & Tobacco--0.3%
RJR Nabisco, Inc. 8.00% 2001......................................... 280,000 284,486
RJR Nabisco, Inc. 8.63% 2002......................................... 300,000 309,513
-----------
593,999
-----------
ENERGY--1.1%

Energy Services--1.1%
Arkla, Inc. 9.20% 1997............................................... 250,000 261,883
Arkla, Inc. 9.88% 1997............................................... 550,000 573,963
National Power Corp. 7.63% 2000...................................... 180,000 177,750
Oryx Energy Co. 9.30% 1996........................................... 400,000 403,564
Oryx Energy Co. 9.50% 1999........................................... 350,000 374,815
Tosco Corp. 7.00% 2000............................................... 400,000 396,000
-----------
2,187,975
-----------
FINANCE--9.6%

Banks--3.5%
Auburn Hills Trust 12.00% 2020(1).................................... 325,000 496,327
Banco de Comercio Exterior 8.63% 2000*............................... 50,000 50,731
Banco Nacional de Comercio Exterior SNC 11.25% 1996(1)(2)............ 360,000 360,000
BankAmerica Corp. 9.75% 2000......................................... 400,000 453,312
BanPonce Corp. 5.17% 1996............................................ 400,000 397,636
Capital One Bank 7.48% 1996.......................................... 1,350,000 1,352,011
Continental Bank NA Chicago 11.25% 2001.............................. 300,000 336,393
Continental Bank NA Chicago 12.50% 2001.............................. 450,000 576,306
Corporacion Andina de Fomento 7.25% 1998............................. 510,000 507,450
Corporacion Andina de Fomento 7.38% 2000............................. 140,000 142,118
First USA Bank 6.88% 1996............................................ 350,000 352,611
First USA Bank 5.05% 1995............................................ 400,000 409,280
Security Pacific Corp. 11.50% 2000................................... 600,000 735,030
Signet Banking Corp. 9.63% 1999...................................... 775,000 852,640

Financial Services--6.1%
App International Finance Co. BV 10.25% 2000......................... 60,000 59,100
Case Equipment Loan Trust 7.30% 2002................................. 751,935 767,664
Chrysler Financial Corp. 5.98% 1997(2)............................... 300,000 300,332
Chrysler Financial Corp. 10.34% 1996(1).............................. 400,000 407,272
</TABLE>

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28
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<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE
<S> <C> <C>
--------------------------------------------------------------------------------------------------
FINANCE (continued)

Financial Services (continued)
Countrywide Funding Corp. 8.43% 1999................................. $ 450,000 $ 486,027
Financiera Energet 6.63% 1996........................................ 1,110,000 1,105,838
First USA, Inc. 5.05% 1995........................................... 400,000 399,708
Ford Capital BV 9.38% 1998........................................... 225,000 240,667
Ford Capital BV 9.50% 2001........................................... 800,000 920,424
Ford Credit Auto Loan Master Trust 6.50% 2002........................ 550,000 561,858
Ford Credit Grantor Trust 7.30% 1999................................. 179,686 182,662
General Motors Acceptance Corp. 6.30% 1999........................... 319,693 320,892
General Motors Acceptance Corp. 7.15% 2000........................... 615,604 625,799
General Motors Acceptance Corp. 7.50% 1997........................... 200,000 206,034
General Motors Acceptance Corp. 7.63% 1998........................... 585,000 606,674
Honda Auto Receivables Grantor Trust 6.20% 2000...................... 332,512 334,175
Household Finance Corp. 7.25% 1994................................... 94,044 94,984
MBNA Corp. 8.25% 1998................................................ 95,833 95,623
Premier Auto Trust 4.90% 1998........................................ 317,641 315,059
Premier Auto Trust 7.85% 1998........................................ 1,040,000 1,066,000
Resolution Funding Corp. zero coupon 2020............................ 1,600,000 315,936
Resolution Funding Corp. zero coupon 2021............................ 1,580,000 308,416
Sears Credit Account Master Trust 8.10% 2004......................... 700,000 753,809
Standard Credit Card Master Trust 6.25% 1998......................... 260,000 261,056
Standard Credit Card Master Trust 7.85% 2002......................... 600,000 640,308
Standard Credit Card Master Trust 8.25% 2003......................... 710,000 784,323
-----------
19,182,485
-----------
INDUSTRIAL & COMMERCIAL--0.5%

Aerospace & Military Technology--0.1%
British Aerospace PLC 7.55% 1997*.................................... 150,000 152,566

Multi-Industry--0.4%
Tenneco, Inc. 10.00% 1998............................................ 800,000 877,672
-----------
1,030,238
-----------
INFORMATION & ENTERTAINMENT--1.3%

Broadcasting & Media--1.1%
Lenfest Communications, Inc. 8.38% 2005.............................. 255,000 254,363
Tele-Communications, Inc. 7.00% 1997................................. 300,000 304,056
Tele-Communications, Inc. 9.65% 2003................................. 375,000 422,513
Time Warner, Inc. 7.45% 1998......................................... 1,145,000 1,173,556

Leisure & Tourism--0.2%
Blockbuster Entertainment Corp. 6.63% 1998........................... 365,000 367,573
-----------
2,522,061
-----------
INFORMATION TECHNOLOGY--1.1%

Communication Equipment--0.5%
Cablevision Industries Corp. 10.75% 2002............................. 980,000 1,060,850

Computers & Business Equipment--0.6%
Comdisco, Inc. 6.08% 1995............................................ 350,000 350,000
Comdisco, Inc. 9.75% 1997............................................ 700,000 728,378
-----------
2,139,228
-----------
MATERIALS--0.1%

Forest Products--0.1%
PT Indah Kiat Pulp & Paper 8.88% 2000................................ 170,000 160,650
-----------
</TABLE>

---------------------

29
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<TABLE>
<CAPTION>
PRINCIPAL
BONDS & NOTES (continued) AMOUNT VALUE

--------------------------------------------------------------------------------------------------
<CAPTION>
<S> <C> <C>
NON-U.S. GOVERNMENT OBLIGATIONS--1.3%

Foreign Government--1.3%
Government Backed Trusts 9.40% 1996.................................. $ 119,595 $ 122,125
Petroleo Brasileiro SA 8.75% 1996(2)................................. 800,000 799,456
Quebec Province Canada 13.25% 2014................................... 625,000 792,812
Republic of Argentina Bote II 5.90% 1997(1).......................... 1,430,000 554,840
Republic of Columbia 9.25% 2000(2)................................... 370,000 373,049
-----------
2,642,282
-----------

U.S. GOVERNMENT & AGENCIES--16.9%

U.S. Government & Agencies--16.9%
Federal Home Loan Mortgage Corp. 6.50% 2018.......................... 600,000 598,872
Federal Home Loan Mortgage Corp. 7.00% TBA........................... 3,500,000 3,501,085
Federal Home Loan Mortgage Corp. 7.50% TBA........................... 3,000,000 3,053,430
Federal Home Loan Mortgage Corp. 8.20% 1998.......................... 310,000 318,962
Federal National Mortgage Association 7.00% TBA...................... 2,000,000 2,023,120
Federal National Mortgage Association 7.50% TBA...................... 1,000,000 1,023,120
Federal National Mortgage Association 7.70% 2004..................... 440,000 465,023
Federal National Mortgage Association 8.79% 2002..................... 180,000 180,900
Government National Mortgage Association 7.50% TBA................... 2,000,000 2,041,240
Government National Mortgage Association 8.00% TBA................... 5,000,000 5,173,400
Government National Mortgage Association 9.00% 2016.................. 516,184 548,363
Government National Mortgage Association 9.00% 2016.................. 583,076 619,425
Government National Mortgage Association 9.00% 2016.................. 481,882 511,923
Government National Mortgage Association 9.00% 2017.................. 342,014 360,504
Government National Mortgage Association 9.50% TBA................... 1,000,000 1,070,000
United States Treasury Bonds 7.88% 2021@............................. 280,000 336,437
United States Treasury Bonds 8.75% 2020.............................. 520,000 680,794
United States Treasury Bonds 11.13% 2003............................. 510,000 678,540
United States Treasury Bonds 13.75% 2004............................. 200,000 307,500
United States Treasury Bonds Strip zero coupon 2020.................. 3,310,000 681,529
United States Treasury Bonds Strip zero coupon 2004.................. 9,580,000 5,691,191
United States Treasury Bonds Strip zero coupon 2018.................. 50,000 11,837
United States Treasury Bonds Strip zero coupon 2021.................. 40,000 7,687
United States Treasury Notes 7.25% 2004.............................. 870,000 956,182
United States Treasury Notes 7.38% 1997.............................. 850,000 880,549
United States Treasury Notes 7.50% 1999.............................. 1,960,000 2,094,436
-----------
33,816,049
-----------
UTILITIES--0.2%

Electric Utilities--0.2%
Central Maine Power Co. 7.45% 1999................................... 365,000 380,126
-----------
TOTAL BONDS & NOTES (cost $64,132,258)............................... 65,558,238
-----------
TOTAL INVESTMENT SECURITIES (cost $170,194,711)...................... 187,514,184
-----------
</TABLE>

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30
<PAGE> 112
<TABLE>
<CAPTION>
PRINCIPAL
SHORT-TERM SECURITIES--0.8% AMOUNT VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
FOREIGN SHORT-TERM NOTES--0.8%

Banco Nacional de Comercio Exterior SNC 9.94% due 5/13/96............ $ 200,000 $ 191,736
Mexican Tesobonos 7.70% due 12/21/95................................. 100,000 99,575
Mexican Tesobonos 7.75% due 12/21/95................................. 400,000 398,300
Mexican Tesobonos 7.75% due 1/18/96.................................. 100,000 98,986
Mexican Tesobonos 7.75% due 2/08/96.................................. 140,000 139,580
Mexican Tesobonos 8.00% due 1/18/96.................................. 100,000 98,950
Petroleo Brasileiro 8.38% due 12/15/95............................... 180,000 179,432
Republic of Argentina 9.50% due 12/04/95............................. 210,000 210,000
Republic of Brazil 10.25% due 12/29/95............................... 140,000 138,906
-----------
TOTAL SHORT-TERM SECURITIES (cost $1,552,233)........................ 1,555,465
-----------

REPURCHASE AGREEMENT--12.3%
--------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--12.3%

Agreement with State Street Bank & Trust Co., bearing interest of
5.75% dated 11/30/95, to be repurchased 12/01/95 in the amount of
$24,554,921 and collateralized by $22,520,000 U.S. Treasury Notes
7.75% due 12/31/99@ (cost $24,551,000)............................. 24,551,000 24,551,000
------------
TOTAL INVESTMENTS--
(cost $196,297,944) 106.9% 213,620,649
Liabilities in excess of other assets-- (6.9) (13,784,259)
----- ------------
NET ASSETS-- 100.0% $199,836,390
===== ============
</TABLE>

-----------------------------

+ Non-income producing securities

* Resale restricted to qualified institutional buyers

(1) Variable rate security; rate as of November 30, 1995

(2) Fair valued security; see Note 2

ADR--American Depositary Receipt

TBA--Securities purchased on a forward commitment basis with an
approximate principal amount and no definitive maturity date.
The actual principal amount and maturity date will be
determined upon settlement date.

@ The security or a portion thereof represents collateral for the
following open futures contracts:
<TABLE>
<CAPTION>
OPEN FUTURES CONTRACTS
-----------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>

UNREALIZED
NUMBER OF EXPIRATION VALUE AS OF APPRECIATION/
CONTRACTS DESCRIPTION DATE NOVEMBER 30, 1995 (DEPRECIATION)
-----------------------------------------------------------------------------------------------------------
4 Long 90 Day Euro Dollar.................... September 1997 $ 944,700 $ 7,670
4 Long 90 Day Euro Dollar.................... December 1997 943,200 7,170
43 Long U.S. Long Bond........................ December 1995 5,134,469 80,274
2 Long U.S. Long Bond........................ March 1996 238,313 (328)
10 Long U.S. 2 Year Note...................... March 1996 2,090,938 5,393
8 Long U.S. 5 Year Note...................... March 1996 877,000 6,689
14 Short U.S. 10 Year Note..................... March 1996 1,587,250 (11,918)
--------
Net Unrealized Appreciation................................................. $ 94,950
========
</TABLE>

See Notes to Financial Statements

---------------------

31
<PAGE> 113

- ---------------------

SUNAMERICA SERIES TRUST
GROWTH-INCOME PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--99.3% SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER DISCRETIONARY--6.0%

Automotive--3.2%
Goodyear Tire & Rubber Co. .......................................... 82,000 $ 3,474,750
Magna International, Inc. ADR........................................ 45,000 1,957,500

Retail--2.8%
Federated Department Stores, Inc.+................................... 79,700 2,321,263
Lowe's Cos., Inc. ................................................... 74,700 2,353,050
Pep Boys-Manny, Moe & Jack........................................... 3,300 87,450
------------
10,194,013
------------
CONSUMER STAPLES--13.8%

Food, Beverage & Tobacco--10.9%
Campbell Soup Co. ................................................... 54,000 3,017,250
McDonald's Corp. .................................................... 60,000 2,677,500
PepsiCo, Inc. ....................................................... 94,000 5,193,500
Philip Morris Cos., Inc. ............................................ 70,000 6,142,500
Wendy's International, Inc. ......................................... 83,000 1,711,875

Household Products--2.9%
Colgate-Palmolive Co. ............................................... 24,000 1,758,000
Gillette Co. ........................................................ 61,700 3,200,687
------------
23,701,312
------------
ENERGY--5.9%

Energy Services--1.2%
Western Atlas, Inc.+................................................. 42,000 2,010,750

Energy Sources--4.7%
Atlantic Richfield Co. .............................................. 40,200 4,356,675
Enron Corp. ......................................................... 98,000 3,675,000
------------
10,042,425
------------
FINANCE--17.2%

Banks--6.7%
BankAmerica Corp. ................................................... 38,000 2,417,750
Fifth Third Bancorp.................................................. 22,000 1,608,750
First Chicago Corp. ................................................. 49,200 3,419,400
NationsBank Corp. ................................................... 37,500 2,676,563
Republic New York Corp. ............................................. 22,000 1,386,000

Financial Services--7.0%
Dean Witter, Discover & Co. ......................................... 54,000 2,754,000
First USA, Inc. ..................................................... 18,000 825,750
MBNA Corp. .......................................................... 35,000 1,413,125
Merrill Lynch & Co., Inc. ........................................... 48,000 2,670,000
Travelers Group, Inc. ............................................... 73,066 4,347,427

Insurance--3.5%
American International Group, Inc. .................................. 28,575 2,564,606
ITT Corp. ........................................................... 15,600 1,912,950
PMI Group, Inc. ..................................................... 30,000 1,425,000
------------
29,421,321
------------
</TABLE>

- ---------------------
32
<PAGE> 114

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
HEALTHCARE--11.5%

Drugs--4.2%
Lilly (Eli) & Co. ................................................... 44,500 $ 4,427,750
Schering-Plough Corp. ............................................... 48,000 2,754,000

Health Services--7.3%
Columbia/HCA Healthcare Corp. ....................................... 76,700 3,959,637
Healthsource, Inc.+.................................................. 21,500 1,343,750
U.S. HealthCare, Inc. ............................................... 80,000 3,640,000
United Healthcare Corp. ............................................. 40,000 2,515,000
Value Health, Inc.+.................................................. 39,000 979,875
------------
19,620,012
------------
INDUSTRIAL & COMMERCIAL--8.7%

Aerospace & Military Technology--2.9%
AlliedSignal, Inc. .................................................. 51,000 2,409,750
Boeing Co. .......................................................... 30,300 2,208,113
Coltec Industries, Inc.+............................................. 30,000 330,000

Business Services--1.5%
WMX Technologies, Inc. .............................................. 87,000 2,566,500

Electrical Equipment--2.4%
General Electric Co. ................................................ 61,200 4,115,700

Machinery--0.5%
Applied Materials, Inc.+............................................. 11,800 573,775
Centocor, Inc.+...................................................... 25,200 352,800

Transportation--1.4%
Conrail, Inc. ....................................................... 17,000 1,187,875
Illinois Central Corp. .............................................. 30,000 1,215,000
------------
14,959,513
------------
INFORMATION & ENTERTAINMENT--3.3%

Broadcasting & Media--1.2%
Tele-Communications Liberty Media Group+............................. 21,250 595,000
Tele-Communications TCI Group+....................................... 85,000 1,572,500

Leisure & Tourism--2.1%
Carnival Corp. ...................................................... 75,000 1,950,000
Disney (Walt) Co. ................................................... 26,600 1,599,325
------------
5,716,825
------------
INFORMATION TECHNOLOGY--13.4%

Communication Equipment--2.8%
AirTouch Communications, Inc.+....................................... 130,00 3,786,250
Motorola, Inc. ...................................................... 17,000 1,041,250

Computers & Business Equipment--3.5%
COMPAQ Computer Corp.+............................................... 73,400 3,633,300
International Business Machines Corp. ............................... 23,600 2,280,350

Electronics--7.1%
General Instrument Corp.+............................................ 67,500 1,729,687
General Motors Corp., Class E........................................ 50,000 2,525,000
Intel Corp. ......................................................... 78,000 4,748,250
National Semiconductor Corp.+........................................ 150,000 3,206,250
------------
22,950,337
------------
</TABLE>

---------------------

33
<PAGE> 115
<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
MATERIALS--8.4%

Chemicals--7.0%
Eastman Kodak Co. ................................................... 30,000 $ 2,040,000
Monsanto Co. ........................................................ 32,000 3,664,000
Morton International, Inc. .......................................... 36,000 1,246,500
Rohm & Haas Co. ..................................................... 32,000 1,928,000
Union Carbide Corp. ................................................. 79,000 3,130,375

Forest Products--1.2%
Alco Standard Corp. ................................................. 46,000 2,001,000

Metals & Minerals--0.2%
Alumax, Inc.+........................................................ 11,500 382,375
------------
14,392,250
------------
UTILITIES--11.1%

Electric Utilities--5.1%
FPL Group, Inc.+..................................................... 100,000 4,337,500
Houston Industries, Inc. ............................................ 94,500 4,323,375

Telephone--6.0%
AT&T Corp. .......................................................... 125,00 8,250,000
Century Telephone Enterprises, Inc. ................................. 67,600 2,112,500
------------
19,023,375
------------
TOTAL INVESTMENT SECURITIES (cost $145,643,214)...................... 170,021,383
------------

PRINCIPAL
SHORT-TERM SECURITIES--4.4% AMOUNT
---------------------------------------------------------------------------------------------------
TIME DEPOSIT--4.4%

Cayman Island Time Deposit with State Street Bank & Trust Co.
5.50% due 12/01/95 (cost $7,513,000)............................... $7,513,000 7,513,000
------------
TOTAL INVESTMENTS--
(cost $153,156,214) 103.7% 177,534,383
Liabilities in excess of other assets-- (3.7) (6,253,310)
----- ------------
NET ASSETS-- 100.0% $171,281,073
===== ==============

</TABLE>

-----------------------------

+ Non-income producing securities

ADR--American Depositary Receipt

See Notes to Financial Statements

- ---------------------

34
<PAGE> 116

- ---------------------

SUNAMERICA SERIES TRUST
ALLIANCE GROWTH PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
COMMON STOCK--90.8% SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER DISCRETIONARY--1.0%

Retail--1.0%
Home Depot, Inc...................................................... 39,000 $ 1,730,625
------------
CONSUMER STAPLES--11.6%

Food, Beverage & Tobacco--9.4%
Coca-Cola Co. ....................................................... 25,100 1,901,325
McDonald's Corp. .................................................... 107,900 4,815,038
PepsiCo, Inc. ....................................................... 34,000 1,878,500
Philip Morris Cos., Inc. ............................................ 81,300 7,134,075

Household Products--2.2%
Gillette Co. ........................................................ 72,800 3,776,500
------------
19,505,438
------------
FINANCE--22.2%

Banks--11.2%
Citicorp............................................................. 52,400 3,707,300
First Bank Systems, Inc. ............................................ 37,800 1,951,425
First Chicago Corp. ................................................. 61,100 4,246,450
First Interstate Bancorp............................................. 11,500 1,541,000
NationsBank Corp. ................................................... 44,500 3,176,188
Norwest Corp. ....................................................... 124,620 4,112,460

Financial Services--9.2%
Beneficial Corp. .................................................... 27,900 1,415,925
Dean Witter, Discover & Co. ......................................... 27,800 1,417,800
Federal National Mortgage Association................................ 50,100 5,485,950
Household International, Inc. ....................................... 32,900 2,056,250
MBNA Corp. .......................................................... 12,600 508,725
Merrill Lynch & Co., Inc. ........................................... 81,600 4,539,000

Insurance--1.8%
ITT Corp. ........................................................... 24,900 3,053,363
------------
37,211,836
------------
HEALTHCARE--5.9%

Drugs--3.8%
Amgen, Inc.+......................................................... 55,200 2,739,300
Merck & Co., Inc. ................................................... 33,200 2,054,250
Schering-Plough Corp. ............................................... 26,500 1,520,437

Health Services--0.9%
United Healthcare Corp. ............................................. 23,800 1,496,425

Medical Products--1.2%
Abbott Laboratories.................................................. 19,700 800,313
Guidant Corp. ....................................................... 34,600 1,293,175
------------
9,903,900
------------
INDUSTRIAL & COMMERCIAL--6.7%

Business Services--1.2%
XTRA Corp. .......................................................... 48,750 2,084,063

Machinery--3.6%
Applied Materials, Inc.+............................................. 122,300 5,946,837
</TABLE>

---------------------

35
<PAGE> 117

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
INDUSTRIAL & COMMERCIAL (continued)

Transportation--1.9%
UAL Corp. ........................................................... 15,300 $ 3,201,525
------------
11,232,425
------------
INFORMATION & ENTERTAINMENT--11.1%

Broadcasting & Media--4.0%
Capital Cities/ABC, Inc. ............................................ 10,400 1,285,700
Tele-Communications Liberty Media Group+............................. 49,725 1,392,300
Tele-Communications TCI Group+....................................... 217,100 4,016,350

Leisure & Tourism--7.1%
Disney (Walt) Co. ................................................... 98,600 5,928,325
KLM Royal Dutch Airlines ADR......................................... 49,500 1,707,750
Northwest Airlines Corp.+............................................ 86,500 4,357,438
------------
18,687,863
------------
INFORMATION TECHNOLOGY--28.5%

Communication Equipment--13.4%
AirTouch Communications, Inc.+....................................... 195,500 5,693,937
Cox Communications, Inc.+............................................ 136,300 2,726,000
DSC Communications Corp.+............................................ 47,600 1,886,150
Ericsson (L.M.) Telephone Co. ADR.................................... 83,000 1,971,250
Motorola, Inc. ...................................................... 53,100 3,252,375
Nokia Corp. ADR...................................................... 127,900 6,938,575

Computers & Business Equipment--4.5%
COMPAQ Computer Corp.+............................................... 37,500 1,856,250
Hewlett-Packard Co. ................................................. 68,000 5,635,500

Electronics--2.1%
Intel Corp. ......................................................... 59,200 3,603,800

Software--8.5%
Cisco Systems, Inc.+................................................. 57,100 4,803,537
Microsoft Corp.+..................................................... 64,500 5,619,562
Oracle Systems Corp.+................................................ 84,400 3,829,650
------------
47,816,586
------------
REAL ESTATE--1.4%

Real Estate Companies--1.4%
Green Tree Financial Corp. .......................................... 82,800 2,339,100
------------
UTILITIES--2.4%

Telephone--2.4%
AT&T Corp. .......................................................... 60,500 3,993,000
------------
TOTAL COMMON STOCK (cost $135,818,446)............................... 152,420,773
------------
</TABLE>

- ---------------------

36
<PAGE> 118
<TABLE>
<CAPTION>
WARRANTS--4.3%+ SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
INFORMATION TECHNOLOGY--4.3%

Electronics--4.3%
Intel Corp. (cost $3,451,125)........................................ 231,000 $ 7,189,875
------------
TOTAL INVESTMENT SECURITIES (cost $139,269,571)...................... 159,610,648
------------

PRINCIPAL
SHORT-TERM SECURITIES--4.8% AMOUNT
---------------------------------------------------------------------------------------------------
TIME DEPOSIT--4.7%

Cayman Island Time Deposit with State Street Bank & Trust Co.
5.50% due 12/01/95@................................................ $7,916,000 7,916,000
------------
U.S. GOVERNMENT--0.1%
United States Treasury Bills 5.18% due 12/21/95@..................... 100,000 99,716
------------
TOTAL SHORT-TERM SECURITIES (cost $8,015,713)........................ 8,015,716
------------
TOTAL INVESTMENTS--
(cost $147,285,284) 99.9% 167,626,364
Other assets less liabilities-- 0.1 243,363
----- ------------
NET ASSETS-- 100.0% $167,869,727
===== ============

</TABLE>

-----------------------

+ Non-income producing securities

ADR--American Depositary Receipt

@ The security or a portion thereof represents collateral for the
following open futures contracts:
<TABLE>
<CAPTION>
OPEN FUTURES CONTRACTS

------------------------------------------------------------------------------------------------------------

<CAPTION>
NUMBER OF EXPIRATION VALUE AS OF UNREALIZED
CONTRACTS DESCRIPTION DATE NOVEMBER 30, 1995 APPRECIATION
------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
9 Long Standard & Poor's 500 Index............. December 1995 $2,732,625 $ 96,750
=========

See Notes to Financial Statements

</TABLE>
---------------------

<PAGE> 119

- ---------------------

SUNAMERICA SERIES TRUST
GROWTH/PHOENIX INVESTMENT
COUNSEL PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--91.6% SHARES VALUE
<S> <C> <C>
---------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--4.7%

Apparel & Textiles--1.8%
Tommy Hilfiger Corp.+................................................ 60,000 $ 2,647,500

Retail--2.9%
Federated Department Stores, Inc.+................................... 92,000 2,679,500
Office Depot, Inc.+.................................................. 27,200 666,400
Sunglass Hut International, Inc.+.................................... 50,700 1,064,700
------------
7,058,100
------------
CONSUMER STAPLES--2.7%

Food, Beverage & Tobacco--2.7%
Boston Chicken, Inc.+................................................ 49,000 1,696,625
Nabisco Holdings Corp. .............................................. 80,000 2,260,000
------------
3,956,625
------------
ENERGY--4.5%

Energy Services--2.4%
Schlumberger Ltd. ................................................... 30,000 1,905,000
Tidewater, Inc. ..................................................... 50,000 1,431,250
Western Atlas, Inc.+................................................. 4,000 191,500

Energy Sources--2.1%
Apache Corp. ........................................................ 88,000 2,343,000
Burlington Northern Santa Fe......................................... 10,600 854,625
------------
6,725,375
------------
FINANCE--12.4%

Banks--1.4%
Chase Manhattan Corp. ............................................... 34,000 2,069,750

Financial Services--5.0%
Dean Witter, Discover & Co. ......................................... 46,000 2,346,000
Morgan Stanley Group, Inc. .......................................... 22,000 1,897,500
Travelers Group, Inc. ............................................... 55,000 3,272,500

Insurance--6.0%
Aetna Life & Casualty Co. ........................................... 62,500 4,585,938
Cigna Corp. ......................................................... 25,000 2,750,000
Prudential Reinsurance Holdings, Inc. ............................... 82,000 1,711,750
------------
18,633,438
------------
HEALTHCARE--17.0%

Drugs--4.8%
Amgen, Inc.+......................................................... 40,000 1,985,000
Boston Scientific Corp.+............................................. 37,000 1,498,500
Merck & Co., Inc. ................................................... 26,500 1,639,688
SmithKline Beecham PLC ADR........................................... 40,000 2,130,000

Health Services--3.1%
Pharmacia & Upjohn, Inc.+............................................ 65,000 2,331,875
U.S. HealthCare, Inc. ............................................... 50,000 2,275,000
</TABLE>

- ---------------------

38
<PAGE> 120

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
HEALTHCARE (continued)

Medical Products--9.1%
Baxter International, Inc. .......................................... 60,000 $ 2,520,000
Genzyme Corp.+....................................................... 40,000 2,610,000
Guidant Corp. ....................................................... 64,500 2,410,687
IDEXX Laboratories, Inc.+............................................ 51,000 2,269,500
Medtronic, Inc. ..................................................... 28,000 1,536,500
Possis Medical, Inc. ................................................ 125,000 2,234,375
------------
25,441,125
------------
INDUSTRIAL & COMMERCIAL--11.2%

Aerospace & Military Technology--2.2%
Boeing Co. .......................................................... 46,000 3,352,250

Business Services--2.4%
CUC International, Inc.+............................................. 60,000 2,280,000
DST Systems, Inc. ................................................... 48,000 1,386,000

Electrical Equipment--2.1%
Austria Mikro Systeme International AG............................... 7,200 1,265,864
AVX Corp. ........................................................... 65,000 1,868,750

Machinery--4.5%
BJ Services Co.+..................................................... 107,000 2,634,875
Case Corp. .......................................................... 40,000 1,670,000
Harnischfeger Industries, Inc. ...................................... 70,000 2,371,250
------------
16,828,989
------------
INFORMATION & ENTERTAINMENT--9.7%

Broadcasting & Media--8.3%
Evergreen Media Corp.+............................................... 50,000 1,212,500
MobileMedia Corp.+................................................... 120,000 3,105,000
News Corp., Ltd. ADR................................................. 100,000 1,887,500
Tele-Communications Liberty Media Group+............................. 18,750 525,000
Tele-Communications TCI Group+....................................... 75,000 1,387,500
Viacom, Inc.+........................................................ 90,500 4,366,625

Leisure & Tourism--1.4%
Disney (Walt) Co. ................................................... 35,000 2,104,375
------------
14,588,500
------------
INFORMATION TECHNOLOGY--24.0%

Communication Equipment--4.9%
Ericsson (L.M.) Telephone Co. ADR.................................... 96,000 2,280,000
Glenayre Technologies, Inc.+......................................... 25,000 1,431,250
Paging Network, Inc.+................................................ 160,000 3,560,000

Computers & Business Equipment--10.7%
3Com Corp.+.......................................................... 78,000 3,568,500
Ascend Communications, Inc.+......................................... 22,000 1,573,000
Bay Networks, Inc.+.................................................. 81,500 3,667,500
NETCOM On-Line Communications Services+.............................. 21,000 1,533,000
Newbridge Networks Corp.+............................................ 54,000 2,301,750
StrataCom, Inc.+..................................................... 26,000 1,950,000
Sun Microsystems, Inc.+.............................................. 18,000 1,514,250

Electronics--1.3%
Intel Corp. ......................................................... 31,000 1,887,125

Software--4.9%
America Online, Inc.+................................................ 50,000 2,043,750
Cheyenne Software, Inc.+............................................. 60,600 1,408,950
</TABLE>

---------------------

<PAGE> 121
<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
INFORMATION TECHNOLOGY (continued)

Software (continued)
Premenos Technology Corp.+........................................... 50,000 $ 2,125,000
Sybase, Inc.+........................................................ 50,000 1,756,250

Telecommunications--2.2%
MFS Communications, Inc.+............................................ 45,000 2,047,500
Mobile Telecommunication Technologies Corp.+......................... 55,000 1,265,000
------------
35,912,825
------------
MATERIALS--5.4%

Chemicals--5.4%
Arcadian Corp. ...................................................... 155,000 3,216,250
Monsanto Co. ........................................................ 20,000 2,290,000
USA Waste Services, Inc.+............................................ 125,000 2,625,000
------------
8,131,250
------------
TOTAL INVESTMENT SECURITIES (cost $120,802,728)...................... 137,276,227
------------

<CAPTION>
PRINCIPAL
SHORT-TERM SECURITIES--9.5% AMOUNT
---------------------------------------------------------------------------------------------------
<S> <C> <C>
CORPORATE SHORT-TERM NOTES--7.5%
Albertson's, Inc. 5.70% due 12/14/95................................. $3,110,000 3,103,599
Bellsouth Capital Funding Corp. 5.71% due 12/12/95................... 2,280,000 2,276,022
du Pont (E.I.) de Nemours & Co. 5.71% due 12/05/95................... 2,430,000 2,428,458
Heinz (H.J.) Co. 5.72% due 12/01/95.................................. 700,000 700,000
Wal-Mart Stores, Inc. 5.70% due 12/04/95............................. 2,775,000 2,773,682
------------
11,281,761
------------
FEDERAL AGENCY OBLIGATIONS--2.0%
Federal Home Loan Bank Discount Notes 5.80% due 12/01/95............. 2,930,000 2,930,000
------------
TOTAL SHORT-TERM SECURITIES (cost $14,211,761)....................... 14,211,761
------------
TOTAL INVESTMENTS--
(cost $135,014,489) 101.1% 151,487,988
Liabilities in excess of other assets -- (1.1) (1,577,505)
------ ------------
NET ASSETS -- 100.0% $149,910,483
=============
======

</TABLE>

-----------------------------

+ Non-income producing securities

ADR--American Depositary Receipt

See Notes to Financial Statements

- ---------------------

40
<PAGE> 122

- ---------------------

SUNAMERICA SERIES TRUST
PROVIDENT GROWTH
PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--96.7% SHARES VALUE
---------------------------------------------------------------------------------------------------
<CAPTION>
<S> <C> <C>
CONSUMER DISCRETIONARY--2.9%

Retail--2.9%
AutoZone, Inc.+...................................................... 49,500 $ 1,441,688
Office Depot, Inc.+.................................................. 76,000 1,862,000
------------
3,303,688
------------
CONSUMER STAPLES--0.9%

Household Products--0.9%
Gillette Co.......................................................... 20,600 1,068,625
------------
ENERGY--2.0%

Energy Sources--2.0%
Enron Corp........................................................... 60,800 2,280,000
------------
FINANCE--15.9%

Financial Services--12.5%
Federal Home Loan Mortgage Corp...................................... 5,300. 408,100
Federal National Mortgage Association................................ 20,600 2,255,700
Finova Group, Inc.................................................... 31,000 1,503,500
First Data Corp...................................................... 83,625 5,937,375
First USA, Inc....................................................... 28,200 1,293,675
MBNA Corp............................................................ 75,300 3,040,237

Insurance--3.4%
American International Group, Inc.................................... 15,300 1,373,175
MGIC Investment Corp................................................. 36,400 2,024,750
PMI Group, Inc....................................................... 11,500 546,250
------------
18,382,762
------------
HEALTHCARE--11.4%

Drugs--5.4%
Amgen, Inc.+......................................................... 17,000 843,625
Cardinal Health, Inc................................................. 26,800 1,447,200
Merck & Co., Inc..................................................... 14,200 878,625
Pfizer, Inc.......................................................... 26,800 1,554,400
Quorum Health Group, Inc.+........................................... 41,600 899,600
Scherer (R.P.) Corp.+................................................ 13,200 585,750

Health Services--2.5%
HEALTHSOUTH Corp.+................................................... 48,200 1,458,050
United Healthcare Corp............................................... 22,500 1,414,687

Medical Products--3.5%
Medtronic, Inc....................................................... 53,400 2,930,325
St. Jude Medical, Inc................................................ 28,200 1,113,900
------------
13,126,162
------------
INDUSTRIAL & COMMERCIAL--10.9%

Aerospace & Military Technology--1.8%
Boeing Co............................................................ 28,300 2,062,363
</TABLE>

---------------------

41
<PAGE> 123

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
-----------------------------------------------------------------------------------------------
<S> <C> <C>
INDUSTRIAL & COMMERCIAL (continued)

Business Services--2.3%
ASM Lithography Holdings NV+......................................... 20,000 $ 842,500
CUC International, Inc.+............................................. 17,000 646,000
Loewen Group, Inc.................................................... 45,400 1,203,100

Electrical Equipment--1.4%
AVX Corp............................................................. 24,000 690,000
SGS-Thomson Microelectronics NV+..................................... 25,000 931,250

Machinery--4.8%
American Standard Companies, Inc.+................................... 37,800 1,134,000
Applied Materials, Inc.+............................................. 55,400 2,693,825
Tyco International Ltd............................................... 53,400 1,675,425

Transportation--0.6%
Fritz Cos., Inc.+.................................................... 17,400 674,250
------------
12,552,713
------------
INFORMATION & ENTERTAINMENT--6.9%

Broadcasting & Media--5.0%
British Sky Broadcast Group PLC ADR.................................. 49,900 1,989,762
Cabletron Systems, Inc.+............................................. 23,500 1,950,500
Capital Cities/ABC, Inc.............................................. 14,900 1,842,013

Leisure & Tourism--1.9%
HFS, Inc............................................................. 31,200 2,160,600
------------
7,942,875
------------
INFORMATION TECHNOLOGY--44.1%

Communication Equipment--9.7%
Ericsson (L.M.) Telephone Co. ADR.................................... 206,400 4,902,000
Glenayre Technologies, Inc.+......................................... 16,800 961,800
Motorola, Inc........................................................ 18,800 1,151,500
Nokia Corp. ADR...................................................... 76,400 4,144,700

Computers & Business Equipment--8.4%
3Com Corp.+.......................................................... 47,800 2,186,850
Automatic Data Processing, Inc....................................... 7,800. 621,075
Ceridian Corp.+...................................................... 13,000 546,000
Computer Sciences Corp.+............................................. 23,600 1,716,900
Hewlett-Packard Co................................................... 24,500 2,030,437
United States Robotics Corp.......................................... 23,800 2,612,050

Electronics--10.6%
Analog Devices, Inc.+................................................ 50,950 1,885,150
Intel Corp........................................................... 65,700 3,999,487
LSI Logic Corp.+..................................................... 32,000 1,340,000
Molex, Inc........................................................... 26,875 839,844
Texas Instruments, Inc............................................... 49,100 2,841,663
Xilinx, Inc.+........................................................ 39,800 1,278,575

Software--13.6%
Cisco Systems, Inc.+................................................. 33,800 2,843,425
Computer Associates International, Inc............................... 49,200 3,222,600
Informix Corp.+...................................................... 56,600 1,567,113
Microsoft Corp.+..................................................... 38,700 3,371,737
Oracle Systems Corp.+................................................ 88,550 4,017,956
Paychex, Inc......................................................... 15,000 676,875
</TABLE>

- ---------------------

<PAGE> 124
<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
---------------------------------------------------------------------------------------------------
<S> <C> <C>
INFORMATION TECHNOLOGY (continued)

Telecommunications--1.8%
Andrew Corp.+........................................................ 27,850 $ 1,204,513
Frontier Corp........................................................ 35,400 915,975
------------
50,878,225
------------
MATERIALS--1.7%

Chemicals--0.9%
Air Products & Chemicals, Inc........................................ 17,500 971,250

Forest Products--0.8%
Alco Standard Corp................................................... 21,400 930,900
------------
1,902,150
------------
TOTAL INVESTMENT SECURITIES (cost $83,389,759)....................... 111,437,200
------------

PRINCIPAL
REPURCHASE AGREEMENT--2.3% AMOUNT
---------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--2.3%
Agreement with State Street Bank & Trust Co., bearing interest of
4.50% dated 11/30/95, to be repurchased 12/01/95 in the amount of
$2,633,329 and collateralized by $2,345,000 U.S. Treasury Bonds
7.50% due 11/15/16 (cost $2,633,000)............................... $2,633,000 2,633,000
------------
TOTAL INVESTMENTS--
(cost $86,022,759) 99.0% 114,070,200
Other assets less liabilities-- 1.0 1,205,839
----- ------------
NET ASSETS-- 100.0% $115,276,039
===== ============

</TABLE>

-----------------------------

+ Non-income producing securities

ADR--American Depositary Receipt

See Notes to Financial Statements

---------------------

43
<PAGE> 125

- ---------------------

SUNAMERICA SERIES TRUST
VENTURE VALUE PORTFOLIOIINVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--87.9% SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
CONSUMER DISCRETIONARY--4.7%

Automotive--2.3%
General Motors Corp. ................................................ 72,000 $ 3,492,000

Retail--2.4%
Federated Department Stores, Inc.+................................... 68,800 2,003,800
Harcourt General, Inc. .............................................. 36,600 1,473,150
Office Max, Inc. .................................................... 100 2,275
Sears, Roebuck & Co. ................................................ 8,100 318,937
------------
7,290,162
------------
CONSUMER STAPLES--8.5%

Food, Beverage & Tobacco--7.5%
American Brands, Inc. ............................................... 2,400 100,200
Archer-Daniels-Midland Co. .......................................... 3,200 55,200
Coca-Cola Co. ....................................................... 53,000 4,014,750
McDonald's Corp. .................................................... 69,600 3,105,900
Nestle SA ADR........................................................ 32,900 1,756,113
Philip Morris Cos., Inc. ............................................ 2,600 228,150
Seagram Co., Ltd. ................................................... 36,600 1,335,900
Tyson Foods, Inc. ................................................... 43,400 1,030,750

Household Products--1.0%
American Home Products Corp. ........................................ 600 54,750
Gillette Co. ........................................................ 27,800 1,442,125
Maytag Corp. ........................................................ 2,200 44,825
------------
13,168,663
------------
ENERGY--4.3%

Energy Services--4.2%
Amerada Hess Corp. .................................................. 45,200 2,147,000
Amoco Corp. ......................................................... 700 47,425
Burlington Resources, Inc. .......................................... 55,100 2,121,350
Chevron Corp. ....................................................... 4,100 202,438
Energy Ventures, Inc.+............................................... 28,400 596,400
Exxon Corp. ......................................................... 6,500 502,937
Mobil Corp. ......................................................... 600 62,625
Schlumberger Ltd. ................................................... 11,600 736,600
Sonat, Inc. ......................................................... 1,200 38,700

Energy Sources--0.1%
Atlantic Richfield Co. .............................................. 1,300 140,888
------------
6,596,363
------------
FINANCE--41.7%

Banks--10.3%
Banc One Corp. ...................................................... 80,900 3,084,312
First Bank Systems, Inc. ............................................ 68,900 3,556,962
First Union Corp. ................................................... 1,100 60,088
Golden West Financial Corp. ......................................... 38,300 1,958,088
Republic New York Corp. ............................................. 13,100 825,300
State Street Boston Corp. ........................................... 56,200 2,529,000
Wells Fargo & Co. ................................................... 18,400 3,868,600
</TABLE>

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44
<PAGE> 126

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
FINANCE (continued)

Financial Services--13.4%
American Express Co. ................................................ 121,300 $ 5,155,250
Barnett Banks, Inc. ................................................. 24,500 1,473,063
Dean Witter, Discover & Co. ......................................... 12,800 652,800
Donaldson Lufkin & Jenrette, Inc. ................................... 26,100 867,825
Federal Home Loan Mortgage Corp. .................................... 10,800 831,600
Morgan (J.P.) & Co., Inc. ........................................... 38,000 2,983,000
Morgan Stanley Group, Inc. .......................................... 44,100 3,803,625
Travelers Group, Inc. ............................................... 85,200 5,069,400

Insurance--18.0%
20th Century Industries+ ............................................ 76,400 1,394,300
Allstate Corp. ...................................................... 97,795 4,009,595
American International Group, Inc. .................................. 21,700 1,947,575
Berkley (W.R.) Corp. ................................................ 45,200 2,045,300
Chubb Corp. ......................................................... 45,800 4,454,050
Equitable Cos., Inc. ................................................ 176,700 4,395,412
General Reinsurance Group............................................ 28,900 4,324,162
NAC Reinsurance Corp. ............................................... 48,900 1,613,700
National Reinsurance Corp. .......................................... 21,700 713,388
Progressive Corp., Ohio.............................................. 36,100 1,606,450
Transatlantic Holdings, Inc. ........................................ 19,400 1,333,750
------------
64,556,595
------------
HEALTHCARE--3.1%

Drugs--3.1%
Bristol-Myers Squibb Co. ............................................ 500 40,125
Johnson & Johnson Co. ............................................... 14,700 1,273,388
Merck & Co., Inc. ................................................... 10,400 643,500
Pfizer, Inc. ........................................................ 48,500 2,813,000

Health Services--0.0%
Transport Holdings, Inc.+ ........................................... 316 12,403
------------
4,782,416
------------
INDUSTRIAL & COMMERCIAL--1.4%

Business Services--0.0%
Dun & Bradstreet Corp. .............................................. 300 18,713
WMX Technologies, Inc. .............................................. 1,000 29,500

Electrical Equipment--0.2%
General Electric Co. ................................................ 3,200 215,200

Transportation--1.2%
Illinois Central Corp. .............................................. 21,000 850,500
Union Pacific Corp. ................................................. 15,500 1,050,125
------------
2,164,038
------------
INFORMATION & ENTERTAINMENT--6.5%

Broadcasting & Media--4.6%
Gannett Co., Inc. ................................................... 49,400 3,013,400
News Corp., Ltd. ADR................................................. 142,000 2,680,250
Tribune Co. ......................................................... 23,500 1,515,750

Leisure & Tourism--1.9%
Disney (Walt) Co. ................................................... 14,300 859,788
Host Marriott Corp.+ ................................................ 158,900 2,045,837
------------
10,115,025
------------
</TABLE>

---------------------

45
<PAGE> 127

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
INFORMATION TECHNOLOGY--8.9%

Communication Equipment--1.5%
AirTouch Communications, Inc.+....................................... 57,000 $ 1,660,125
Cellular Communications, Inc.+ ...................................... 11,900 569,713
SBC Communications, Inc. ............................................ 700 37,800

Computers & Business Equipment--2.4%
Hewlett-Packard Co. ................................................. 44,500 3,687,937

Electronics--5.0%
Cirrus Logic, Inc.+.................................................. 32,400 939,600
Intel Corp. ......................................................... 68,600 4,176,025
Texas Instruments, Inc. ............................................. 46,100 2,668,037

Telecommunications--0.0%
Royal PTT Nederland NV ADR+ ......................................... 100 3,538
------------
13,742,775
------------
MATERIALS--5.7%

Chemicals--0.9%
Dow Chemical Co. .................................................... 400 28,350
Eastman Kodak Co. ................................................... 21,800 1,482,400

Forest Products--4.5%
Fort Howard Corp.+................................................... 86,200 1,713,225
International Paper Co. ............................................. 600 22,875
Jefferson Smurfit Corp. ............................................. 57,700 649,125
Mead Corp. .......................................................... 20,100 1,148,212
Union Camp Corp. .................................................... 47,400 2,328,525
Weyerhaeuser Co. .................................................... 24,200 1,095,050

Metals & Minerals--0.3%
Alumax, Inc.+........................................................ 3,900 129,675
Reynolds Metals Co. ................................................. 5,500 317,625
------------
8,915,062
------------
REAL ESTATE--2.0%

Real Estate Investment Trusts--2.0%
Federal Realty Investment Trust...................................... 25,000 550,000
Kimco Realty Corp. .................................................. 3,700 148,000
Mid-Atlantic Realty Trust............................................ 14,800 125,800
Saul Centers, Inc. .................................................. 15,900 220,613
Simon Property Group, Inc. .......................................... 400 9,300
United Dominion Realty Trust, Inc. .................................. 27,300 385,612
Vornado Realty Trust................................................. 39,200 1,391,600
Weingarten Realty Investors.......................................... 8,000 274,000
------------
3,104,925
------------
UTILITIES--1.1%

Electric Utilities--0.1%
Carolina Power & Light Co. .......................................... 600 19,725
Duke Power Co. ...................................................... 900 40,387
New England Electric Systems......................................... 300 11,700
San Diego Gas & Electric Co. ........................................ 500 11,375
SCEcorp. ............................................................ 700 10,938
Southern Co. ........................................................ 1,200 27,450
Wisconsin Energy Corp. .............................................. 500 14,750
</TABLE>

- ---------------------

46
<PAGE> 128
<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
UTILITIES (continued)

Telephone--1.0%
AT&T Corp. .......................................................... 7,700 $ 508,200
MCI Communications Corp. ............................................ 39,700 1,061,975
------------
1,706,500
-----------
TOTAL COMMON STOCK (cost $121,711,418)............................... 136,142,524
------------

PREFERRED STOCK--2.4%
---------------------------------------------------------------------------------------------------
FINANCE--2.4%
Banks--2.4%
Banc One Corp., Series C............................................. 3,700 250,213
Citicorp............................................................. 18,510 3,549,292
------------
TOTAL PREFERRED STOCK (cost $3,029,488).............................. 3,799,505
------------
TOTAL INVESTMENT SECURITIES (cost $124,740,906)...................... 139,942,029
------------

PRINCIPAL
SHORT-TERM SECURITIES--11.0% AMOUNT
---------------------------------------------------------------------------------------------------
FEDERAL AGENCY OBLIGATIONS--11.0%

Federal Farm Credit Bank Discount Notes 5.68% due 12/04/95........... $ 5,410,000 5,407,439
Federal Home Loan Mortgage Discount Notes 5.80% due 12/01/95......... 11,590,000 11,590,000
------------
TOTAL SHORT-TERM SECURITIES (cost $16,997,439) 16,997,439
------------
TOTAL INVESTMENTS--
(cost $141,738,345) 101.3% 156,939,468
Liabilities in excess of other assets-- (1.3) (2,031,471)
------ ------------
NET ASSETS-- 100.0% $154,907,997
====== ============

</TABLE>

-----------------------------

+ Non-income producing securities

ADR--American Depositary Receipt

See Notes to Financial Statements

---------------------

47
<PAGE> 129

- ---------------------

SUNAMERICA SERIES TRUST
GLOBAL EQUITIES PORTFOLIO INVESTMENT PORTFOLIO--NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--94.7% SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
AUSTRALIA--1.0%
Coca-Cola Amatil Ltd. (Consumer Staples)............................. 67,219 $ 543,778
Mayne Nickless Ltd. (Industrial & Commercial)........................ 27,313 125,680
National Australia Bank Ltd. (Finance)............................... 41,000 357,236
Qantas Airways Ltd. (Industrial & Commercial)........................ 41,731 70,925
Woolworths Ltd. (Consumer Discretionary)............................. 275,404 643,849
------------
1,741,468
------------
BELGIUM--0.3%
Kredietbank NV (Finance)............................................. 2,271 580,545
------------
CANADA--1.4%
Alcan Aluminium Ltd. (Materials)..................................... 52 1,763
Magna International, Inc. (Consumer Discretionary)................... 15,000 651,454
Renaissance Energy Ltd. (Energy)..................................... 71,900 1,653,938
------------
2,307,155
------------
DENMARK--0.7%
Den Danske Bank (Finance)............................................ 15,300 1,035,112
Tele Danmark A/S (Utilities)......................................... 3,300 179,668
------------
1,214,780
------------
FINLAND--1.0%
Metsa-Serla Oy (Materials)........................................... 14,400 485,446
Nokia Corp. (Information Technology)................................. 12,800 702,315
Unitas Ltd. (Finance)................................................ 175,035 435,431
------------
1,623,192
------------
FRANCE--5.6%
Assurance General de France (Finance)................................ 22,600 726,841
Banque National Paris (Finance)...................................... 16,200 717,403
Bouygues SA (Consumer Discretionary)................................. 3,100 340,407
Casino Guichard Perrachon et Cie S.C.A. (Consumer Discretionary)..... 6,849 193,509
Cie Financiere de Paribas (Finance).................................. 8,415 467,247
Credit Foncier de France (Finance)................................... 7,300 142,328
Eaux (cie Generale) (Industrial & Commercial)........................ 7,370 717,137
Groupe Danone (Consumer Staples)..................................... 4,490 702,673
Legris Industries SA (Industrial & Commercial)....................... 5,700 191,885
Peugeot SA (Consumer Discretionary).................................. 5,550 717,313
Salomon SA (Consumer Staples)........................................ 920 512,125
Sanofi SA (Healthcare)............................................... 7,600 439,964
Sefimeg (Real Estate)................................................ 3,700 255,786
Seita (Healthcare)................................................... 16,000 525,799
Simco (Real Estate).................................................. 2,600 237,050
Societe de Immeubles (Real Estate)................................... 2,671 147,720
Total SA (Energy).................................................... 12,405 763,117
TV Francaise (Information & Entertainment)........................... 3,430 338,842
Unibail SA (Finance)................................................. 4,630 459,243
Union Immeubles de France (Real Estate).............................. 3,300 295,582
USINOR SACILOR (Materials)........................................... 23,900 344,336
------------
9,236,307
------------
GERMANY--2.7%
Bayer AG (Materials)................................................. 3,810 991,290
Deutsche Bank AG (Finance)........................................... 22,000 1,032,082
</TABLE>

- ---------------------

48
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
GERMANY (continued)
KSB Kl Schanz Beck (Finance)......................................... 950 $ 154,360
Lufthansa AG (Industrial & Commercial)............................... 3,780 501,805
Schmalbach-Lubeca AG (Materials)..................................... 2,400 350,135
Sudzucker AG (Consumer Staples)...................................... 953 484,308
Veba AG (Utilities).................................................. 22,180 904,805
------------
4,418,785
------------
HONG KONG--1.7%
CITIC Pacific Ltd. (Information & Entertainment)..................... 97,000 305,363
Consolidated Electric Power (Utilities).............................. 257,000 420,309
Dao Heng Bank Group (Finance)........................................ 101,000 372,144
Hong Kong & China Gas Co., Ltd. (Utilities).......................... 79,400 129,854
Hopewell Holdings Ltd. (Real Estate)................................. 647,000 365,955
Hysan Development Co., Ltd. (Real Estate)............................ 50,000 130,254
Johnson Electric Holdings Ltd. (Industrial & Commercial)............. 109,000 225,471
New World Development Co., Ltd. (Real Estate)........................ 32,783 136,898
New World Infrastructure Ltd. (Consumer Discretionary)............... 227 395
Sun Hung Kai Properties Ltd. (Real Estate)........................... 24,000 193,150
Television Broadcasting Ltd. (Information & Entertainment)........... 68,000 256,707
Yizheng Chemical Fibre (Materials)................................... 947,000 231,397
------------
2,767,897
------------
INDIA--0.2%
Bajaj Auto GDR (Consumer Discretionary).............................. 13,400 301,500
------------
INDONESIA--0.7%
Hanjaya Mandala Sampoerna (Healthcare)............................... 60,000 601,708
Indosat (Information Technology)..................................... 123,500 417,796
Perusahaan Persero Part Telekom ADR (Utilities)...................... 6,000 126,000
------------
1,145,504
------------
IRELAND--0.3%
Irish Life PLC (Finance)............................................. 120,066 462,012
------------
ITALY--0.9%
ENI SPA (Energy)..................................................... 106,000 347,993
Rinascente (Consumer Discretionary).................................. 102,000 571,497
SIP (Finance)........................................................ 284,050 386,331
Telecom Italia Mobile SPA nonconvertible (Utilities)................. 92,500 90,234
Telecom Italia Mobile SPA (Utilities)................................ 24,450 39,446
------------
1,435,501
------------
JAPAN--23.2%
Amano Corp. (Industrial & Commercial)................................ 39,000 490,614
Aoki International Co., Ltd. (Consumer Discretionary)................ 3,000 71,057
Asahi Bank (Finance)................................................. 113,000 1,310,467
Asahi Glass Co., Ltd. (Materials).................................... 72,000 792,531
Bank of Tokyo Ltd. (Finance)......................................... 37,000 603,636
Canon, Inc. (Information Technology)................................. 10,000 175,921
Chiba Bank Ltd. (Finance)............................................ 23,000 202,310
Dai Nippon Printing Co., Ltd. (Industrial & Commercial).............. 25,000 437,346
Daifuku Co., Ltd. (Industrial & Commercial).......................... 25,000 304,668
Daito Trust Construction Co. (Industrial & Commercial)............... 4,000 38,880
Daiwa House Industry Co. Ltd. (Industrial & Commercial).............. 14,000 209,140
Daiwa Securities Co., Ltd. (Finance)................................. 14,000 194,005
DDI Corp. (Healthcare)............................................... 208 1,672,177
East Japan Railway (Industrial & Commercial)......................... 135 662,064
Fuji Bank Ltd. (Finance)............................................. 59,000 1,229,287
Fuji Photo Film Co., Ltd. (Materials)................................ 11,000 272,432
</TABLE>

---------------------

49
<PAGE> 131

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
JAPAN (continued)
Furukawa Co., Ltd. (Materials)....................................... 40,000 $ 199,312
Heiwa Corp. (Industrial & Commercial)................................ 23,000 596,757
Hirose Electric Co., Ltd. (Information Technology)................... 3,000 182,506
Hokkaido Takushoku Bank Ltd. (Finance)............................... 75,000 198,280
Honda Motor Co., Ltd. (Consumer Discretionary)....................... 11,000 198,919
House Food Corp. (Consumer Staples).................................. 18,000 318,428
Ito-Yokado Co. (Consumer Discretionary).............................. 7,000 386,634
Japan Securities Finance Co., Ltd. (Finance)......................... 30,000 430,467
Kamigumi Co., Ltd. (Industrial & Commercial)......................... 28,000 255,096
Kandenko Co. (Consumer Discretionary)................................ 24,000 292,482
Kao Corp. (Consumer Staples)......................................... 62,000 761,671
Kirin Brewery Co., Ltd. (Consumer Staples)........................... 35,000 371,499
Kokuyo Co., Ltd. (Industrial & Commercial)........................... 9,000 193,710
Kuraray Co., Ltd. (Materials)........................................ 57,000 582,604
Kyocera Corp. (Information Technology)............................... 4,000 316,462
Long-Term Credit Bank of Japan Ltd. (Finance)........................ 22,000 181,405
Mabuchi Motor Co., Ltd. (Consumer Discretionary)..................... 6,000 371,499
Maeda Corp. (Industrial & Commercial)................................ 9,000 153,907
Marui Co., Ltd. (Consumer Discretionary)............................. 3,000 56,020
Matsushita Electric Industrial Co., Ltd. (Industrial & Commercial)... 58,000 860,737
Matsushita Electric Works Ltd. (Industrial & Commercial)............. 37,000 381,818
Mitsubishi Bank Ltd. (Finance)....................................... 56,000 1,221,818
Mitsubishi Heavy Industrial Ltd. (Industrial & Commercial)........... 47,000 374,614
Mitsubishi Materials Corp. (Materials)............................... 39,000 196,246
Mitsubishi Oil Co., Ltd. (Utilities)................................. 47,000 403,715
Mitsui Marine & Fire Co., Ltd. (Finance)............................. 60,000 403,931
Mitsui Trust & Banking Co. (Finance)................................. 123,000 1,153,238
Mori Seiki Co., Ltd. (Industrial & Commercial)....................... 9,000 178,673
National House Industrial Co., Ltd. (Industrial & Commercial)........ 14,000 227,027
NGK Insulators Ltd. (Industrial & Commercial)........................ 25,000 248,157
NGK Spark Plug Co., Ltd. (Industrial & Commercial)................... 7,000 90,123
Nikko Securities Co., Ltd. (Finance)................................. 39,000 429,287
Nintendo Co., Ltd. (Consumer Discretionary).......................... 5,100 402,988
Nippon Express Co., Ltd. (Industrial & Commercial)................... 35,000 303,735
Nippon Light Metal Co., Ltd. (Materials)............................. 40,000 231,941
Nippon Steel Corp. (Materials)....................................... 112,000 385,258
Nisshin Steel Co., Ltd. (Materials).................................. 94,000 386,162
NKK Corp. (Materials)................................................ 140,000 385,258
Nomura Securities International, Inc. (Finance)...................... 61,000 1,199,017
Ono Pharmaceutical Co., Ltd. (Healthcare)............................ 1,000 35,774
Osaka Gas Co. (Utilities)............................................ 89,000 302,644
Rohm Co. (Information Technology).................................... 15,000 915,479
Sakura Bank Ltd. (Finance)........................................... 113,000 1,221,622
Sankyo Co., Ltd. (Healthcare)........................................ 8,000 178,477
Santen Pharmaceutical Co. (Healthcare)............................... 2,000 44,226
Seven-Eleven Japan Co., Ltd. (Consumer Discretionary)................ 23,000 1,591,351
Shimano, Inc. (Industrial & Commercial).............................. 7,000 122,457
Shimizu Construction Co. (Consumer Discretionary).................... 37,000 378,182
Shiseido Co., Ltd. (Healthcare)...................................... 24,000 254,742
Sony Corp. ADR (Consumer Discretionary).............................. 2,020 108,827
Sumitomo Electric Industries Ltd. (Industrial & Commercial).......... 27,000 315,774
Sumitomo Marine & Fire Insurance Co., Ltd. (Finance)................. 46,000 355,794
Sumitomo Realty & Development Co., Ltd. (Real Estate)................ 52,000 349,052
Sumitomo Rubber Industries Ltd. (Industrial & Commercial)............ 14,000 111,450
Sumitomo Bank (Finance).............................................. 81,000 1,560,295
Taisho Pharmaceutical Co., Ltd. (Healthcare)......................... 19,000 358,526
Takeda Chemical Industries Ltd. (Healthcare)......................... 24,000 358,526
Toagosei Co., Ltd. (Materials)....................................... 21,000 114,752
Tokai Bank Ltd. (Finance)............................................ 47,000 572,776
</TABLE>

- ---------------------

50
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---------------------

51
<PAGE> 133

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
SINGAPORE--1.0%
Oversea Chinese Banking Corp. Ltd. (Finance)......................... 39,000 $ 467,281
Overseas Union Bank Ltd. (Finance)................................... 103,000 653,563
Singapore Airlines Ltd. (Industrial & Commercial).................... 13,000 121,659
Singapore Press Holdings Ltd. (Information & Entertainment).......... 26,400 417,384
------------
1,659,887
------------
SPAIN--1.2%
Banco Intercontinental Espanol (Finance)............................. 7,000 663,908
Repsol SA (Energy)................................................... 20,400 643,008
Tabacalera SA (Consumer Staples)..................................... 15,800 593,518
Uralita SA (Materials)............................................... 12,300 124,741
------------
2,025,175
------------
SWEDEN--1.4%
Astra AB (Healthcare)................................................ 32,600 1,215,880
Stora Kopparbergs (Materials)........................................ 43,200 550,255
Tidnings AB Marieberg (Information & Entertainment).................. 21,700 516,391
------------
2,282,526
------------
SWITZERLAND--2.1%
Baloise Holdings (Finance)........................................... 100 202,042
Ciba-Geigy AG (Materials)............................................ 1,200 1,069,842
Forbo Holding SA (Finance)........................................... 1,400 544,279
Nestle SA (Consumer Staples)......................................... 1,030 1,097,907
Winterthur Swiss Insurance Co. (Finance)............................. 812 540,873
------------
3,454,943
------------
TAIWAN--0.2%
Advanced Semiconductor Materials International NV GDR (Information
Technology)+....................................................... 21,100 238,430
China Steel Corp. GDS (Materials).................................... 6,000 95,220
------------
333,650
------------
THAILAND--0.2%
Bangkok Bank (Finance)............................................... 19,000 202,385
Thai Farmers Bank (Finance).......................................... 23,000 204,769
------------
407,154
------------
UNITED KINGDOM--7.9%
Anglian Water PLC (Industrial & Commercial).......................... 13,300 120,335
B.A.T. Industries PLC (Consumer Staples)............................. 131,000 1,117,070
British Airways PLC (Industrial & Commercial)........................ 88,000 619,718
British Land Co. PLC (Real Estate)................................... 76,000 436,895
British Telecommunications PLC (Information Technology).............. 120,000 691,672
BTR PLC (Industrial & Commercial).................................... 135,800 695,424
Enterprise Oil PLC (Energy).......................................... 39,600 215,824
Forte PLC (Information & Entertainment).............................. 84,500 442,422
General Electric Co. (Industrial & Commercial)....................... 136,291 663,511
Grand Metropolitan PLC (Industrial & Commercial)..................... 120,200 813,356
Hepworth PLC (Industrial & Commercial)............................... 117,000 557,953
House Of Fraser PLC (Consumer Discretionary)......................... 62,200 157,119
Marley PLC (Industrial & Commercial)................................. 214,800 369,948
Meyer International PLC (Materials).................................. 13,300 79,409
Mowlem (John) & Co. PLC (Materials).................................. 360,000 319,657
P & O PLC (Industrial & Commercial).................................. 71,354 530,622
Royal Bank of Scotland Group PLC (Finance)........................... 77,800 664,611
Rugby Group PLC (Industrial & Commercial)............................ 309,600 507,153
Sainsbury (J.) PLC (Consumer Discretionary).......................... 69,700 410,282
Smith (W.H.) Group PLC (Consumer Discretionary)...................... 75,000 497,168
Smithkline Beecham PLC (Healthcare).................................. 31,593 335,905
Tate & Lyle, PLC (Consumer Staples).................................. 119,000 828,919
</TABLE>

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52
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
UNITED KINGDOM (continued)
Thorn EMI PLC (Consumer Discretionary)............................... 11,500 $ 274,208
Vodafone Group PLC (Information Technology).......................... 228,500 815,072
Wimpey (George) PLC (Consumer Discretionary)......................... 499,400 1,001,552
------------
13,165,805
------------
UNITED STATES--36.1%
AirTouch Communications, Inc. (Information Technology)+.............. 46,900 1,365,962
Alco Standard Corp. (Materials)...................................... 12,800 556,800
AlliedSignal, Inc. (Industrial & Commercial)......................... 20,000 945,000
Alumax, Inc. (Materials)+............................................ 4,500 149,625
American International Group, Inc. (Finance)......................... 15,900 1,427,025
Applied Materials, Inc. (Industrial & Commercial)+................... 2,200 106,975
AT&T Corp. (Utilities)............................................... 37,400 2,468,400
Atlantic Richfield Co. (Energy)...................................... 13,000 1,408,875
BankAmerica Corp. (Finance).......................................... 13,500 858,938
Boeing Co. (Industrial & Commercial)................................. 12,200 889,075
Campbell Soup Co. (Consumer Staples)................................. 14,400 804,600
Carnival Corp. (Information & Entertainment)......................... 25,500 663,000
Centocor, Inc. (Industrial & Commercial)+............................ 10,000 140,000
Century Telephone Enterprises, Inc. (Utilities)...................... 27,100 846,875
Colgate-Palmolive Co. (Consumer Staples)............................. 13,600 996,200
Columbia/HCA Healthcare Corp. (Healthcare)........................... 29,000 1,497,125
COMPAQ Computer Corp. (Information Technology)+...................... 27,800 1,376,100
Conrail, Inc. (Industrial & Commercial).............................. 2,700 188,663
Cox Communications, Inc. (Information Technology)+................... 23,500 470,000
Dean Witter, Discover & Co. (Finance)................................ 21,200 1,081,200
Disney (Walt) Co. (Information & Entertainment)...................... 10,700 643,338
Eastman Kodak Co. (Materials)........................................ 14,200 965,600
Enron Corp. (Energy)................................................. 15,000 562,500
Federal National Mortgage Association (Finance)...................... 6,200 678,900
Federated Department Stores, Inc. (Consumer Discretionary)+.......... 31,500 917,437
Fifth Third Bancorp (Finance)........................................ 10,000 731,250
First Chicago Corp. (Finance)........................................ 18,200 1,264,900
FPL Group, Inc. (Utilities)+......................................... 37,000 1,604,875
General Electric Co. (Industrial & Commercial)....................... 22,300 1,499,675
General Instrument Corp. (Information Technology)+................... 27,100 694,438
General Motors Corp., Class E (Information Technology)............... 17,600 888,800
Gillette Co. (Consumer Staples)...................................... 17,400 902,625
Goodyear Tire & Rubber Co. (Consumer Discretionary).................. 31,100 1,317,862
Houston Industries, Inc. (Utilities)................................. 34,000 1,555,500
Illinois Central Corp. (Industrial & Commercial)..................... 5,400 218,700
Intel Corp. (Information Technology)................................. 28,200 1,716,675
International Business Machines Corp. (Information Technology)....... 10,800 1,043,550
ITT Corp. (Finance).................................................. 4,000 490,500
Lilly (Eli) & Co. (Healthcare)....................................... 16,900 1,681,550
Lowe's Cos., Inc. (Consumer Discretionary)........................... 30,100 948,150
May Department Stores Co. (Consumer Discretionary)................... 16,340 712,833
MBNA Corp. (Finance)................................................. 15,200 613,700
McDonald's Corp. (Consumer Staples).................................. 19,400 865,725
Merrill Lynch & Co., Inc. (Finance).................................. 16,160 898,900
Morton International, Inc. (Materials)............................... 19,000 657,875
Motorola, Inc. (Information Technology).............................. 6,900 422,625
National Semiconductor Corp. (Information Technology)+............... 41,100 878,512
NationsBank Corp. (Finance).......................................... 16,340 1,166,267
Pep Boys-Manny, Moe & Jack (Consumer Discretionary).................. 1,300 34,450
PepsiCo, Inc. (Consumer Staples)..................................... 33,000 1,823,250
Philip Morris Cos., Inc. (Consumer Staples).......................... 21,700 1,904,175
PMI Group, Inc. (Finance)............................................ 11,000 522,500
Republic New York Corp. (Finance).................................... 8,500 535,500
</TABLE>

---------------------

53
<PAGE> 135
<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
----------------------------------------------------------------------------------------------------
<S> <C> <C>
UNITED STATES (continued)
Rohm & Haas Co. (Materials).......................................... 18,530 $ 1,116,432
Schering-Plough Corp. (Healthcare)................................... 26,200 1,503,225
Transport Holdings, Inc. (Finance)................................... 100 3,925
Travelers, Inc. (Finance)............................................ 31,500 1,874,250
U.S. HealthCare, Inc. (Healthcare)................................... 30,000 1,365,000
Union Carbide Corp. (Materials)...................................... 29,900 1,184,787
United Healthcare Corp. (Healthcare)................................. 7,900 496,713
Value Health, Inc. (Healthcare)+..................................... 14,700 369,338
Wendy's International, Inc. (Consumer Staples)....................... 44,400 915,750
Western Atlas, Inc. (Energy)+........................................ 11,300 540,988
WMX Technologies, Inc. (Industrial & Commercial)..................... 31,400 926,300
------------
59,900,283
------------
TOTAL COMMON STOCK (cost $145,786,621)............................... 157,038,603
------------

PREFERRED STOCK--0.9%
----------------------------------------------------------------------------------------------------
BRAZIL--0.3%
Dixie Toga SA (Industrial & Commercial).............................. 139,000 109,347
Klabin Fabricadora (Materials)....................................... 265,625 255,699
Sider Riograndense (Materials)....................................... 7,000,000 115,930
------------
480,976
------------
GERMANY--0.6%
Henkel KGAA (Consumer Staples)....................................... 1,860 697,034
KSB Kl Schanz Beck (Finance)......................................... 2,270 233,074
------------
930,108
------------
TOTAL PREFERRED STOCK (cost $1,672,720).............................. 1,411,084
------------
RIGHTS--0.0%+
----------------------------------------------------------------------------------------------------
BRAZIL--0.0%
Dixie Toga SA (Industrial & Commercial) (1) (cost $0)................ 16,623 0
------------
WARRANTS--0.0%+
----------------------------------------------------------------------------------------------------
MALAYSIA--0.0%
Development & Commercial Bank Bhd (Finance).......................... 32,000 29,263
Ta Enterprises Bhd (Utilities)....................................... 50,000 34,292
------------
TOTAL WARRANTS (cost $5,070)......................................... 63,555
------------
TOTAL INVESTMENT SECURITIES (cost $147,464,411)...................... 158,513,242
------------

PRINCIPAL
SHORT-TERM SECURITIES--6.2% AMOUNT
----------------------------------------------------------------------------------------------------
TIME DEPOSIT--6.2%
Cayman Island Time Deposit with State Street Bank & Trust Co.
5.50% due 12/01/95 (cost $10,230,000).............................. $10,230,000 10,230,000
-------------
TOTAL INVESTMENTS--
(cost $157,694,411) 101.8% 168,743,242
Liabilities in excess of other assets-- (1.8) (2,991,545)
------ -------------
NET ASSETS-- 100.0% $165,751,697
====== =============
</TABLE>

-----------------------------

+ Non-income producing securities

(1) Fair valued security; see Note 2

ADR--American Depositary Receipt

GDR--Global Depositary Receipt

GDS--Global Depositary Shares

- ---------------------
54
<PAGE> 136
<TABLE>
<CAPTION>
OPEN FORWARD FOREIGN CURRENCY CONTRACTS
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CONTRACT IN DELIVERY GROSS UNREALIZED
TO DELIVER EXCHANGE FOR DATE APPRECIATION

------------------------------------------------------------------------
DEM 3,000,000 USD 2,126,604 01/31/96 $ 45,720
*GBP 900,000 USD 1,415,700 12/29/95 37,868
JPY 250,000,000 USD 2,520,415 01/31/96 39,937
----------------
123,525
----------------

GROSS UNREALIZED
DEPRECIATION
------------------------------------------------------------------------
JPY 125,000,000 USD 1,229,770 01/31/96 $ (10,469)
JPY 160,000,000 USD 1,565,926 01/31/96 (21,581)
JPY 125,000,000 USD 1,219,631 01/31/96 (20,608)
*USD 1,427,670 GBP 900,000 12/29/95 (49,838)
----------------
(102,496)
----------------
Net Unrealized Appreciation................ $ 21,029
==============
</TABLE>

-----------------------------

* Represents open forward foreign currency contracts and
offsetting open forward foreign currency contracts that do not
have additional market risk but have continued counterparty
settlement risk.

DEM--Deutsche Mark

GBP--Pound Sterling

JPY--Japanese Yen

USD--United States Dollar

See Notes to Financial Statements

---------------------

55
<PAGE> 137

- ---------------------

SUNAMERICA SERIES TRUST
INTERNATIONAL DIVERSIFIED
EQUITIES PORTFOLIO INVESTMENT PORTFOLIO -- NOVEMBER 30, 1995
<TABLE>
<CAPTION>
COMMON STOCK--90.3% SHARES VALUE
--------------------------------------------------------------------------------------------------
<CAPTION>
<S> <C> <C>
AUSTRALIA--1.9%
Amcor Ltd. (Materials)............................................... 6,000 $ 43,640
Boral Ltd. (Industrial & Commercial)................................. 11,000 26,043
Brambles Industries. Ltd. (Industrial & Commercial).................. 1,700 18,547
Broken Hill Proprietary Co. (Energy)................................. 13,937 189,495
Coca-Cola Amatil Ltd. (Consumer Staples)............................. 3,529 28,548
Cochlear Ltd. (Information Technology)(1)............................ 7,800 14,472
Coles Myer Ltd. (Consumer Discretionary)............................. 10,544 33,962
CRA Ltd. (Materials)................................................. 4,400 69,687
CSR Ltd. (Industrial & Commercial)................................... 7,800 24,950
Fosters Brewing Group (Consumer Staples)............................. 13,800 22,635
General Property Trust (Real Estate)................................. 6,220 10,710
Goodman Fielder Ltd. (Consumer Staples).............................. 14,000 14,027
ICI Australia Ltd. (Materials)....................................... 2,500 18,461
Lend Lease Corp. Ltd. (Real Estate).................................. 1,814 25,095
M.I.M. Holdings Ltd. (Materials)..................................... 11,067 15,031
National Australia Bank Ltd. (Finance)............................... 10,369 90,346
Newcrest Mining Ltd. (Materials)..................................... 2,380 10,722
News Corp. Ltd. (Information & Entertainment)........................ 15,697 82,248
North Ltd. (Materials)............................................... 5,827 16,347
Pacific Dunlop Ltd. (Industrial & Commercial)........................ 7,800 18,640
Renison Goldfields Consolidated Ltd. (Materials)..................... 473 1,176
Renison Goldfields Consolidated Ltd. nonconvertible (Materials)...... 2,060 9,479
Santos Ltd. (Energy)................................................. 5,200 13,739
Southcorp Holdings Ltd. (Industrial & Commercial).................... 4,600 10,208
TNT Ltd. (Industrial & Commercial)................................... 4,600 6,418
Western Mining Corp. Holdings Ltd. (Materials)....................... 7,600 50,934
Westfield Trust (Finance)............................................ 320 556
Westfield Trust (Real Estate)........................................ 7,300 12,732
Westpac Banking Corp. (Finance)...................................... 13,500 55,908
-----------
934,756
-----------
BELGIUM--1.9%
Bekaert SA (Industrial & Commercial)................................. 30 23,058
Cimenteries CBR Cementbedrijven (Industrial & Commercial)............ 75 29,389
Delhaize Freres & Cie Le Lion (Consumer Discretionary)............... 1,000 41,776
Electrabel (Utilities)............................................... 850 193,559
Fortis AG (Finance).................................................. 600 69,626
Fortis AG (Finance).................................................. 19 2,205
Generale de Banque Belge Pour l'Etranger SA (Finance)................ 265 89,136
Groupe Bruxelles Lambert SA (Industrial & Commercial)................ 400 52,069
Kredietbank SA (Finance)............................................. 250 63,908
Petrofina SA (Energy)................................................ 400 118,533
Royale Belge SA (Finance)............................................ 250 45,913
Solvay SA (Materials)................................................ 175 90,208
Tractebel Investor International (Industrial & Commercial)........... 225 84,763
Union Miniere SA (Energy)............................................ 450 27,851
-----------
931,994
-----------
FRANCE--4.8%
Accor SA (Information & Entertainment)............................... 400 48,572
Air Liquide (L') (Materials)......................................... 550 88,498
Alcatel Alsthom (Information Technology)............................. 1,550 129,143
</TABLE>

- ---------------------

56
<PAGE> 138

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
FRANCE (continued)
AXA SA (Finance)..................................................... 1,350 $ 80,776
Banque Nationale de Paris (Finance).................................. 1,700 75,283
Carrefour (Consumer Discretionary)................................... 230 126,925
Cie de St. Gobain (Materials)........................................ 950 109,648
Cie de Suez (Finance)................................................ 1,400 52,488
Cie Financiere de Paribas (Finance).................................. 1,050 58,302
Cie Generale des Eaux (Industrial & Commercial)...................... 1,000 97,305
Compagnie Bancaire SA (Finance)...................................... 400 43,523
Compagnie UAP SA (Finance)........................................... 2,500 64,723
Groupe Danone (Consumer Staples)..................................... 850 133,023
Havas SA (Industrial & Commercial)................................... 600 44,124
L' Oreal (Consumer Staples).......................................... 700 173,369
Lafarge SA (Materials)............................................... 1,050 66,697
LVMH Moet Hennessy Louis Vuitton (Consumer Staples).................. 850 161,807
Lyonnaise des Eaux SA (Multi-industry)............................... 700 67,047
Michelin SA, Class B (Consumer Discretionary)........................ 1,350 54,860
Peugeot SA (Consumer Discretionary).................................. 450 58,161
Pinault Printemps Redoute (Consumer Discretionary)................... 250 47,089
Promodes (Consumer Discretionary).................................... 200 44,204
Rhone Poulenc SA (Materials)......................................... 2,900 62,062
Sagem (Industrial & Commercial)...................................... 40 21,361
Schneider SA (Industrial & Commercial)............................... 1,250 45,987
Sefimeg (Real Estate)................................................ 350 24,196
Societe Generale (Finance)........................................... 750 87,617
Societe Nationale Elf Aquitaine (Energy)............................. 2,200 154,117
Thomson CSF (Industrial & Commercial)................................ 1,200 26,330
Total SA (Energy).................................................... 1,950 119,958
-----------
2,367,195
-----------
GERMANY--5.1%
Allianz AG Holding (Finance)......................................... 204 393,951
AMB Aachener Und Muenchner (Finance)................................. 50 32,670
Asko Deutsche Kaushaus AG (Consumer Discretionary)................... 50 23,335
BASF AG (Materials).................................................. 500 109,590
Bayer AG (Materials)................................................. 550 143,100
Bayerische Hypotheken Und Bank AG (Finance).......................... 2,050 50,743
Bayerische Vereinsbank AG (Finance).................................. 2,000 57,734
Bilfinger & Berger Bau AG (Consumer Discretionary)................... 50 19,429
Daimler-Benz AG (Consumer Discretionary)............................. 350 172,181
Deutsche Bank AG (Finance)........................................... 3,500 164,195
Dresdner Bank AG (Finance)........................................... 3,300 88,415
Hochtief AG (Consumer Discretionary)................................. 100 44,942
Karstadt AG (Consumer Discretionary)................................. 100 39,480
Kaufhof Holding AG (Consumer Discretionary).......................... 50 15,142
Linde AG (Industrial & Commercial)................................... 50 29,316
Lufthansa AG (Industrial & Commercial)............................... 300 39,826
Man AG (Industrial & Commercial)..................................... 100 28,245
Mannesmann AG (Industrial & Commercial).............................. 300 96,598
Merck Kgaa (Healthcare).............................................. 1,200 49,177
Munchener Ruckversicherungs (Finance)................................ 50 92,063
Preussag AG (Multi-industry)......................................... 150 43,165
RWE AG (Utilities)................................................... 250 90,835
SAP AG (Materials)................................................... 475 75,866
Schering AG (Consumer Staples)....................................... 550 37,363
Siemens AG (Industrial & Commercial)................................. 400 208,947
Thyssen AG (Materials)............................................... 250 46,221
Veba AG (Utilities).................................................. 3,700 150,937
</TABLE>

---------------------

57
<PAGE> 139

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
GERMANY (continued)
Viag AG (Multi-industry)............................................. 150 $ 59,816
Volkswagen AG (Consumer Discretionary)............................... 250 81,069
-----------
2,484,351
-----------
HONG KONG--8.2%
Applied International Holdings Ltd. (Information & Entertainment).... 42,000 4,561
Bank of East Asia Ltd. (Finance)..................................... 21,390 77,431
Cathay Pacific Airways Ltd. (Industrial & Commercial)................ 82,000 122,445
Cheung Kong Holdings Ltd. (Real Estate).............................. 58,000 329,933
China Light & Power Co., Ltd. (Utilities)............................ 49,500 232,944
Chinese Estates Ltd. (Real Estate)................................... 52,000 34,959
Hang Seng Bank Ltd. (Finance)........................................ 51,800 452,042
Hong Kong & China Gas Co., Ltd. (Utilities).......................... 46,600 76,212
Hong Kong Telecommunications, Ltd. (Information Technology).......... 304,000 516,826
Hongkong & Shanghai Hotels Ltd. (Information & Entertainment)........ 49,000 61,766
Hopewell Holdings Ltd. (Real Estate)................................. 120,000 67,874
Hutchison Whampoa Ltd. (Multi-industry).............................. 96,000 542,373
Hysan Development Co., Ltd. (Real Estate)............................ 25,000 65,127
Johnson Electric Holdings Ltd. (Industrial & Commercial)............. 12,000 24,823
Miramar Hotel & Investment Co., Ltd. (Information & Entertainment)... 19,000 37,460
New World Development Co., Ltd. (Real Estate)........................ 45,106 188,357
Shun Tak Holdings Ltd. (Industrial & Commercial)..................... 50,000 33,937
South China Morning Post (Holdings) Ltd. (Information &
Entertainment)..................................................... 92,000 55,010
Sun Hung Kai Properties Ltd. (Real Estate)........................... 60,000 482,876
Swire Pacific Ltd. (Multi-industry).................................. 48,000 363,030
Wharf Holdings Ltd. (Real Estate).................................... 59,000 197,178
Wing Lung Bank Ltd. (Finance)........................................ 4,240 24,119
-----------
3,991,283
-----------
INDONESIA--2.7%
Bank Dagang Nasional (Finance)....................................... 77,875 64,796
Barito Pacific Timber (Materials).................................... 251,000 184,114
Gadjah Tunggal (Consumer Discretionary).............................. 143,000 81,410
Hanjaya Mandala Sampoerna (Consumer Staples)......................... 80,500 807,291
Jakarta International Hotel & Development (Industrial &
Commercial)........................................................ 69,500 82,177
Matahari Putra Prima (Consumer Discretionary)........................ 30,750 56,895
Pan Brothers Textiles (Consumer Discretionary)....................... 5,000 1,588
Sinar Mas Agro Resources Corp. (Multi-industry)...................... 37,500 22,170
United Tractors (Industrial & Commercial)............................ 25,500 46,343
-----------
1,346,784
-----------
ITALY--2.3%
Acciaierie & Ferriere Lombarde (Materials)........................... 1,000 1,963
Assicurazione Generali SpA (Finance)................................. 9,000 205,138
Banca Commerciale Italiana SpA (Finance)............................. 19,000 36,119
Banco Ambrosiano Veneto SpA (Finance)................................ 7,000 17,290
Benetton Group SpA (Consumer Discretionary).......................... 2,000 23,043
Credito Italiano SpA (Finance)....................................... 25,000 25,748
Edison SpA (Utilities)............................................... 7,000 27,971
Fiat SpA (Consumer Discretionary).................................... 35,000 105,711
Fiat SpA nonconvertible (Consumer Discretionary)..................... 9,000 14,942
Finanziaria di Sviluppo SpA (Multi-industry)......................... 5,000 8,270
Gilardini SpA (Industrial & Commercial).............................. 5,000 6,175
Istituto Bancario San Paolotorno (Finance)........................... 9,000 48,963
Istituto Mobiliare Italiano (Finance)................................ 6,700 38,021
Istituto Nazionale Delle Asazioni SpA (Finance)...................... 44,500 53,428
Italcementi Fabbriche SpA (Materials)................................ 3,500 18,844
Italgas-Societa Itailiana per il Gas SpA (Utilities)................. 8,000 20,511
</TABLE>

- ---------------------

58
<PAGE> 140

<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
ITALY (continued)
La Rinascente Per L'Eserciz Grandi Magazzini SpA (Consumer
Discretionary)..................................................... 3,000 $ 16,809
Mediobanca Banca di Creditonziar (Finance)........................... 6,000 38,082
Montedison SpA (Multi-industry)...................................... 60,000 37,219
Montedison SpA nonconvertible (Multi-industry)....................... 10,000 5,403
Olivetti ING C, & Co. (Information Technology)....................... 20,000 13,257
Pirelli SpA (Consumer Discretionary)................................. 20,000 24,325
R.A.S (Finance)...................................................... 50 262
Riunione Adriatica de Sicur (Finance)................................ 3,250 33,279
S.A.I Societa Assicuratrice Industriale SpA (Finance)................ 2,000 19,072
Sirti SpA (Consumer Discretionary)................................... 2,500 14,476
SME STA Meridionale Finanzi SpA (Consumer Discretionary)............. 4,457 9,783
SNIA BPD SpA (Multi-industry)........................................ 10,000 7,817
Telecom Italia Mobile SPA (Information Technology)................... 75,200 121,323
Telecom Italia SpA nonconvertible (Information Technology)........... 15,000 16,555
Telecom Italia SpA (Information Technology).......................... 75,000 102,006
-----------
1,111,805
-----------
JAPAN--33.3%
Ajinomoto Co., Inc. (Consumer Staples)............................... 17,000 183,784
Aoyama Trading Co. Ltd. (Consumer Discretionary)..................... 1,000 28,796
Asahi Bank Ltd. (Finance)............................................ 15,000 173,956
Asahi Chemical Industry Co., Inc. (Materials)........................ 42,000 313,710
Asahi Glass Co. Ltd. (Materials)..................................... 17,000 187,125
Bank of Tokyo Ltd. (Finance)......................................... 17,000 277,346
Bank of Yokohama Ltd. (Finance)...................................... 12,000 89,042
Bridgestone Corp. (Industrial & Commercial).......................... 11,000 162,162
Dai Nippon Printing Co. Ltd. (Industrial & Commercial)............... 17,000 297,396
Dai-Ichi Kangyo Bank Ltd. (Finance).................................. 28,000 522,850
Daiei, Inc. (Consumer Discretionary)................................. 7,000 80,491
Daishowa Paper Manufacturing Co. Ltd. (Materials).................... 3,000 24,472
Daiwa House Industry Co. Ltd. (Consumer Discretionary)............... 9,000 134,447
Daiwa Securities Co. Ltd. (Finance).................................. 13,000 180,147
Ebara Corp. (Industrial & Commercial)................................ 4,000 56,609
Fanuc Ltd. (Information Technology).................................. 3,900 165,966
Fuji Bank Ltd. (Finance)............................................. 26,000 541,720
Fuji Photo Film Co. Ltd. (Consumer Staples).......................... 10,000 247,666
Fujitsu Ltd. (Information Technology)................................ 19,000 224,079
Hitachi Ltd. (Information Technology)................................ 17,000 172,089
Honda Motor Co. Ltd. (Consumer Discretionary)........................ 12,000 217,003
Industrial Bank of Japan Ltd. (Finance).............................. 22,000 631,351
Japan Airlines Co. Ltd. (Information & Entertainment)................ 17,000 108,767
Japan Energy Corp. (Energy).......................................... 13,000 40,246
Jusco Co. Ltd. (Consumer Discretionary).............................. 5,000 119,902
Kajima Corp. (Consumer Discretionary)................................ 12,000 117,464
Kansai Electric Power Co., Inc. (Utilities).......................... 12,635 299,266
KAO Corp. (Consumer Staples)......................................... 17,000 208,845
Kawasaki Steel Corp. (Materials)..................................... 38,000 134,821
Kirin Brewery Co. Ltd. (Consumer Staples)............................ 17,000 180,442
Kobe Steel Ltd. (Materials).......................................... 47,000 134,418
Kubota Ltd. (Industrial & Commercial)................................ 34,000 223,548
Kumagai Gumi Co. Ltd. (Consumer Discretionary)....................... 8,000 31,607
Kyocera Corp. (Information Technology)............................... 3,000 237,346
Marubeni Corp. (Consumer Discretionary).............................. 43,000 228,206
Marui Co. Ltd. (Consumer Discretionary).............................. 6,000 112,039
Matsushita Electric Industrial Co. Ltd. (Consumer Discretionary)..... 18,000 267,125
Mitsubishi Corp. (Consumer Discretionary)............................ 21,000 251,794
Mitsubishi Electric Corp. (Information Technology)................... 23,000 170,889
Mitsubishi Estate Co. Ltd. (Real Estate)............................. 16,000 180,835
</TABLE>

---------------------

59
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
JAPAN (continued)
Mitsubishi Heavy Industrial Ltd. (Industrial & Commercial)........... 52,000 $ 414,467
Mitsubishi Trust & Banking Corp (Finance)............................ 12,000 183,980
Mitsui Fudosan Co. Ltd. (Real Estate)................................ 11,000 136,216
Mitsui Trust & Banking Co. Ltd. (Finance)............................ 14,000 131,263
Mitsukoshi Ltd. (Consumer Discretionary)............................. 7,000 61,779
Mochida Pharmaceutical Co. Ltd. (Healthcare)......................... 1,000 13,268
NEC Corp. (Information Technology)................................... 14,000 178,870
Nippon Express Co. Ltd. (Industrial & Commercial).................... 17,000 147,528
Nippon Oil Co. Ltd. (Energy)......................................... 26,000 143,096
Nippon Steel Corp. (Materials)....................................... 51,000 175,430
Nippondenso Co. Ltd. (Industrial & Commercial)....................... 12,000 221,720
Nissan Motor Co. Ltd. (Consumer Discretionary)....................... 24,000 176,668
NKK Corp. (Materials)................................................ 54,000 148,600
Nomura Securities International, Inc. (Finance)...................... 17,000 334,152
Odakyu Electric Railway Co. Ltd. (Industrial & Commercial)........... 31,000 219,361
Pioneer Electronic Corp. (Consumer Staples).......................... 3,000 52,187
Sakura Bank Ltd. (Finance)........................................... 29,000 313,514
Sankyo Co. Ltd. (Healthcare)......................................... 5,000 111,548
Sanyo Electric Co. Ltd. (Consumer Staples)........................... 25,000 130,221
Sega Enterprises Ltd. (Consumer Discretionary)....................... 1,300 70,270
Sekisui Chemical Co. Ltd. (Materials)................................ 7,000 90,123
Sekisui House Ltd. (Consumer Discretionary).......................... 9,000 105,258
Seven-Eleven Japan Co. Ltd. (Consumer Discretionary)................. 4,000 276,757
Sharp Corp. (Consumer Staples)....................................... 7,000 99,066
Shimizu Construction Co. (Consumer Discretionary).................... 9,000 91,990
Shiseido Co. Ltd. (Healthcare)....................................... 5,000 53,071
Sony Corp. (Consumer Discretionary).................................. 4,000 212,285
Sumitomo Chemical Co. Ltd. (Materials)............................... 26,000 129,297
Sumitomo Corp. (Consumer Discretionary).............................. 13,000 129,042
Sumitomo Metal Industrial (Materials)................................ 40,000 121,474
Sumitomo Metal Mining Co. Ltd. (Materials)........................... 7,000 61,160
Sumitomo Trust & Banking Co. Ltd. (Finance).......................... 29,000 558,624
Taisei Corp. (Consumer Discretionary)................................ 29,000 189,248
Taisho Pharmaceutical Co. Ltd. (Healthcare).......................... 5,000 94,349
Takeda Chemical Industries Ltd. (Healthcare)......................... 17,000 253,956
Tobu Railway Co. Ltd. (Industrial & Commercial)...................... 10,000 59,263
Tokai Bank Ltd. (Finance)............................................ 23,000 280,295
Tokio Marine & Fire Insurance Co. Ltd. (Finance)..................... 17,000 193,808
Tokyo Electric Power Co., Inc. (Utilities)........................... 15,173 393,678
Tokyo Gas Co. Ltd. (Utilities)....................................... 34,000 119,961
Tokyu Corp. (Industrial & Commercial)................................ 14,000 97,278
Toray Industries, Inc. (Materials)................................... 20,000 130,123
Tostem Corp. (Materials)............................................. 4,000 121,867
Toto Ltd. (Materials)................................................ 5,000 67,813
Toyo Seikan Kaisha Ltd. (Materials).................................. 3,000 91,106
Toyota Motor Corp. (Consumer Discretionary).......................... 35,000 691,401
Yamaichi Securities Co. (Finance).................................... 14,000 88,609
Yamanouchi Pharmaceutical Co. Ltd. (Healthcare)...................... 5,000 107,617
Yasuda Trust & Banking Co. Ltd. (Finance)............................ 14,000 67,420
-----------
16,299,844
-----------
MALAYSIA--1.7%
AMMB Holdings Bhd (Finance).......................................... 2,000 20,694
Amsteel Corp. (Materials)............................................ 11,000 7,458
Amsteel Corp. Bhd (Materials)........................................ 5,000 3,390
Aokam Perdana Bhd (Materials)........................................ 2,000 2,933
Berjaya Group Bhd (Multi-industry)................................... 7,000 4,249
Development & Commercial Bank Holdings Bhd (Finance)................. 9,000 23,768
Edaran Otomobil Nasional Bhd (Consumer Discretionary)................ 2,000 14,348
</TABLE>

- ---------------------
60
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
MALAYSIA (continued)
Golden Hope Plantations Bhd (Materials).............................. 12,000 $ 19,204
Guinness Anchor Bhd (Consumer Staples)............................... 4,000 6,937
Highlands & Lowlands Bhd (Materials)................................. 5,000 7,174
Hong Leong Properties Bhd (Real Estate).............................. 10,000 10,367
Hume Industries (Materials).......................................... 3,000 13,480
Idris Hydraulic (Finance)............................................ 6,000 7,142
Kuala Lumpur Kepong (Materials)...................................... 4,000 11,510
Land & General Bhd (Materials)....................................... 4,000 7,962
Landmarks Bhd (Information & Entertainment).......................... 4,000 4,982
Leader Universal Holdings Bhd (Industrial & Commercial).............. 4,000 10,642
Magnum Corp. Bhd (Information & Entertainment)....................... 8,000 15,388
Malayan Banking Bhd (Finance)........................................ 10,000 79,227
Malayan Cement Bhd (Materials)....................................... 3,000 5,298
Malayan United Industries Bhd (Multi-industry)....................... 6,000 4,564
Malaysia Mining Corp. Bhd (Materials)................................ 6,000 7,899
Malaysian Airlines System (Industrial & Commercial).................. 6,000 17,619
Malaysian International Shipping Corp. (Industrial & Commercial)..... 9,000 21,994
Malaysian Resources Corp. Bhd (Real Estate).......................... 6,000 7,615
Metroplex Bhd (Real Estate).......................................... 9,000 6,918
Mulpha International Bhd (Multi-industry)............................ 7,000 7,312
Multi Purpose Holding (Multi-industry)............................... 7,000 10,099
Nestle Bhd (Consumer Staples)........................................ 1,000 7,016
Oriental Holdings Bhd (Consumer Discretionary)....................... 2,000 9,381
Perlis Plantations Bhd (Materials)................................... 3,000 9,223
Perusahaan Otomobil Nasiona (Consumer Discretionary)................. 5,000 16,851
Public Bank Bhd (Finance)............................................ 10,000 18,605
Rashid Hussain Bhd (Finance)......................................... 4,000 9,933
Resorts World Bhd (Information & Entertainment)...................... 10,000 48,877
Rothmans of Pall Mall (Consumer Staples)............................. 2,000 15,294
Shell Refining Co. of Malaysia (Energy).............................. 3,000 9,105
Sime Darby Bhd (Multi-industry)...................................... 18,000 46,472
Tan Chong Motor Holdings Bhd (Consumer Discretionary)................ 8,000 8,041
Technology Resources Industries Bhd (Information Technology)......... 6,000 16,791
Telekom Malaysia Bhd (Information Technology)........................ 16,000 119,196
Tenaga Nasional Bhd (Utilities)...................................... 26,100 97,734
UMW Holdings Bhd (Industrial & Commercial)........................... 3,000 7,036
United Engineers Bhd (Industrial & Commercial)....................... 5,000 31,139
YTL Corp. Bhd (Consumer Discretionary)............................... 3,000 16,555
-----------
847,422
-----------
NETHERLANDS--4.2%
ABN AMRO Holdings NV (Finance)....................................... 3,300 146,934
Akzo NV (Materials).................................................. 875 98,885
Elsevier NV (Consumer Discretionary)................................. 11,600 158,315
Heineken NV (Consumer Staples)....................................... 400 70,104
Internationale Nederlanden Groep NV CVA (Finance).................... 2,900 189,835
KLM Royal Dutch Air (Industrial & Commercial)........................ 950 32,619
Koninklijke Ahold NV (Consumer Discretionary)........................ 1,200 31,643
Koninklijke KNP BT (Materials)....................................... 1,244 49,244
Koninlijke PTT Nederland NV (Information Technology)................. 5,328 189,851
Philips Electronics NV (Consumer Staples)............................ 3,700 145,551
Royal Dutch Petroleum Co. (Energy)................................... 5,600 720,361
Unilever NV CVA (Consumer Staples)................................... 1,650 218,057
-----------
2,051,399
-----------
NORWAY--1.8%
Aker AS (Multi-industry)............................................. 1,700 21,220
Bergesen D Y AS (Industrial & Commercial)............................ 2,200 45,250
Dyno Industrier AS (Materials)....................................... 1,000 22,138
Elkem AS (Materials)................................................. 2,100 23,905
</TABLE>

---------------------

61
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
NORWAY (continued)
Hafslund Nycomed AS (Healthcare)..................................... 3,750 $ 98,917
Helikopter Service AS (Industrial & Commercial)...................... 750 8,537
Kvaerner Industrier AS (Industrial & Commercial)..................... 1,600 52,755
Leif Hoegh & Co. AS (Industrial & Commercial)........................ 1,300 18,983
Norsk Hydro AS (Energy).............................................. 9,000 366,698
Norske Skogindystrier AS (Materials)................................. 1,100 32,470
Orkla-Borregaard AS (Multi-industry)................................. 1,750 89,300
Petroleum Geo Services AS (Energy)................................... 1,000 19,548
Transocean AS (Energy)............................................... 1,450 25,043
Unistorabrand AS (Consumer Discretionary)............................ 10,800 58,672
Unitor AS (Industrial & Commercial).................................. 800 10,425
Vard AS (Information & Entertainment)................................ 3,000 2,591
-----------
896,452
-----------
PORTUGAL--0.3%
Banco Portugues do Atlantico SA (Finance)............................ 8,700 131,131
Companhia de Seguros Imperio (Finance)............................... 2,050 12,441
-----------
143,572
-----------
SINGAPORE--3.5%
Amcol Holdings Ltd. (Consumer Staples)............................... 9,000 21,822
City Developments Ltd. (Real Estate)................................. 24,000 165,048
Cycle & Carriage Ltd. (Consumer Discretionary)....................... 7,000 61,538
DBS Land Ltd. (Real Estate).......................................... 29,000 90,053
Development Bank of Singapore (Finance).............................. 12,000 140,376
First Capital Corp. Ltd. (Real Estate)............................... 8,000 21,553
Fraser & Neave Ltd. (Consumer Staples)............................... 8,000 95,285
Inchcape Bhd (Multi-industry)........................................ 6,000 18,291
Keppel Corp. Ltd. (Industrial & Commercial).......................... 19,000 156,257
NatSteel Ltd. (Materials)............................................ 9,000 18,504
Neptune Orient Lines Ltd. (Industrial & Commercial).................. 27,000 28,330
Overseas Chinese Banking Corp. Ltd. (Finance)........................ 17,000 203,687
Overseas Union Enterprise Ltd. (Information & Entertainment)......... 6,000 28,713
Robinson & Co., Ltd. (Consumer Discretionary)........................ 2,000 8,295
Shangri-La Hotel Ltd. (Information & Entertainment).................. 5,000 16,944
Singapore Airlines Ltd. (Information & Entertainment)................ 25,000 233,960
Singapore Press Holdings Ltd. (Information & Entertainment).......... 5,800 91,698
Straits Steamship Land Ltd. (Multi-industry)......................... 19,000 60,078
Straits Trading Co., Ltd. (Materials)................................ 13,000 29,309
United Industrial Corp. (Multi-industry)............................. 59,000 51,032
United Overseas Bank Ltd. (Finance).................................. 18,000 162,070
-----------
1,702,843
-----------
SPAIN--3.4%
Acerinox SA (Materials).............................................. 250 25,050
Acerinox SA (Materials).............................................. 12 1,202
Autopistas Concesionaria Espana SA (Industrial & Commercial)......... 4,200 46,343
Banco Bilbao Vizcaya SA (Finance).................................... 4,700 155,008
Banco Central Hispanoamericano SA (Finance).......................... 3,300 67,604
Banco de Santander SA (Finance)...................................... 1,100 51,316
Corporacion Bancaria de Espana (Argentaria) (Finance)................ 2,500 97,866
Corporacion Financiera Alba (Multi-industry)......................... 500 28,193
Corporacion Mapfre SA (Finance)...................................... 600 33,784
Empresa Nacional Celulos SA (Materials).............................. 450 7,685
Empresa Nacional de Electricidad SA (Utilities)...................... 5,000 268,549
Fomento Construcciones Y Contratas SA (Consumer Discretionary)....... 400 30,376
Gas Natural SDG SA (Utilities)....................................... 750 106,486
Iberdrola SA (Utilities)............................................. 17,800 150,193
Inmobiliaria Metropolitana Vasco Central SA (Real Estate)............ 550 18,028
Mapfre Vida SA (Finance)............................................. 13 733
</TABLE>

- ---------------------

62
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
SPAIN (continued)
Portland Valderrivas SA (Materials).................................. 225 $ 14,093
Repsol SA (Energy)................................................... 6,100 192,272
Tabacalera SA (Consumer Staples)..................................... 850 31,930
Telefonica de Espana SA (Information Technology)..................... 18,800 259,300
Union Electrica-Fenosa SA (Utilities)................................ 6,400 34,686
Viscofan Industria Navarra (Materials)............................... 700 7,298
Zardoya Otis SA (Industrial & Commercial)............................ 200 20,770
-----------
1,648,765
-----------
SWITZERLAND--3.2%
Alusuisse-Lonza Holdings (Materials)................................. 25 20,268
BBC Brown Boveri Ltd. (Information Technology)....................... 50 57,422
Ciba-Geigy AG BR (Materials)......................................... 20 17,746
Ciba-Geigy AG (Materials)............................................ 130 115,900
CS Holding (Finance)................................................. 1,000 94,853
Fischer (Georg) AG (Consumer Staples)................................ 10 13,356
Gebrueder Sulzer AG (Industrial & Commercial)........................ 24 13,271
Holderbank Financiere Glarus (Finance)............................... 42 31,299
Nestle SA (Consumer Staples)......................................... 220 234,504
Roche Holding (Mortgage-related Securities).......................... 38 287,061
Roche Holding AG (Mortgage-related Securities)....................... 10 130,157
Sandoz Ltd. (Mortgage-related Securities)............................ 200 170,821
SGS Societe Generale de Surance Holding SA (Materials)............... 12 22,561
SMH Schweizerische Ges Fueroelektronik & Uhrenindustri (Information &
Entertainment)..................................................... 24 14,067
Swiss Bank Corp. BR (Finance)........................................ 150 59,719
Swiss Bank Corp. (Finance)........................................... 150 29,796
Swiss Reinsurance Co. (Finance)...................................... 50 55,934
Union Bank of Switzerland (Finance).................................. 120 125,359
Zuerich Versicherungs (Finance)...................................... 250 76,776
-----------
1,570,870
-----------
THAILAND--1.5%
Advanced Information Services (Information Technology)............... 4,300 68,363
Bangchak Petroleum PCL (Energy)...................................... 9,600 11,828
Bangkok Metropolitan Bank PCL (Finance).............................. 14,100 12,749
CMIC Finance & Security PCL (Finance)................................ 3,500 10,016
Dhana Siam Finance & Securities PCL (Finance)........................ 4,600 21,025
General Finance & Securities (Finance)............................... 2,450 9,835
Italian-Thai Development PCL (Energy)................................ 4,600 42,782
Jasmine International PCL (Information Technology)................... 6,200 34,006
Krung Thai Bank PCL (Finance)........................................ 25,800 95,366
National Finance & Securities PCL (Finance).......................... 3,200 13,609
National Petrochemical PCL (Materials)............................... 5,700 9,628
One Holding PCL (Multi-industry)..................................... 2,900 6,224
Phatra Thanakit Co. (Finance)........................................ 2,700 21,892
Phatra Thanakit PCL local (Finance).................................. 2,300 16,180
PTT Exploration & Production (Energy)................................ 5,700 53,013
Sahavirya Steel Industries (Materials)............................... 9,400 11,489
Shinawatra Computer & Communication PCL (Information Technology)..... 2,500 58,029
Shinawatra Satelite PCL (Industrial & Commercial).................... 6,400 10,111
Siam City Bank PCL local (Finance)................................... 10,000 9,837
Siam City Bank PCL (Finance)......................................... 12,100 13,105
Telecomasia Corp. PCL (Utilities).................................... 40,900 126,797
Thai Military Bank PCL local (Finance)............................... 4,300 13,843
Thai Military Bank PCL (Finance)..................................... 4,300 15,040
United Communication Industries (Information Technology)............. 4,300 51,272
-----------
736,039
-----------
</TABLE>

---------------------

63
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<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
UNITED KINGDOM--10.5%
Abbey National PLC (Finance)......................................... 12,800 $ 125,903
Argyll Group PLC (Consumer Discretionary)............................ 9,900 47,136
Arjo Wiggins Appleton PLC (Materials)................................ 12,300 32,294
Barclays PLC (Finance)............................................... 10,401 125,315
Bass PLC (Consumer Staples).......................................... 6,900 72,835
BAT Industries PLC (Multi-industry).................................. 23,301 198,693
BOC Group PLC (Materials)............................................ 5,700 76,748
Boots Co. PLC (Consumer Discretionary)............................... 7,600 65,854
British Aerospace PLC (Industrial & Commercial)...................... 3,899 49,006
British Airways PLC (Industrial & Commercial)........................ 5,700 40,141
British Gas PLC (Utilities).......................................... 35,500 132,609
British Petroleum Co. PLC (Energy)................................... 45,600 359,173
British Telecommunications PLC (Information Technology).............. 45,000 259,377
BTR PLC (Multi-industry)............................................. 26,700 136,729
Cable & Wireless PLC (Information Technology)........................ 7,996 55,514
Commercial Union PLC (Finance)....................................... 4,700 46,374
General Accident PLC (Finance)....................................... 4,500 45,779
General Electric PLC (Industrial & Commercial)....................... 23,400 113,919
Glaxo Wellcome PLC (Consumer Staples)................................ 21,307 284,278
Grand Metropolitan PLC (Multi-industry).............................. 14,300 96,764
Great Universal Stores PLC (Consumer Discretionary).................. 2,300 21,690
Guinness PLC (Consumer Staples)...................................... 15,000 106,093
Hanson PLC (Multi-industry).......................................... 36,600 109,542
HSBC Holdings PLC (Finance).......................................... 12,700 188,692
Imperial Chemical Industries PLC (Materials)......................... 6,400 74,464
Kingfisher PLC (Consumer Staples).................................... 7,271 57,605
Ladbroke Group PLC (Information & Entertainment)..................... 17,900 39,187
Land Securities PLC (Real Estate).................................... 10,300 94,059
Lloyds Bank PLC (Finance)............................................ 10,932 145,269
Marks & Spencer PLC (Consumer Discretionary)......................... 21,100 142,616
MEPC PLC (Real Estate)............................................... 4,600 27,430
National Power PLC (Utilities)....................................... 8,100 57,166
Peninsular & Oriental Steam PLC (Industrial & Commercial)............ 6,596 49,051
Prudential Corp. PLC (Finance)....................................... 18,700 123,245
Rank Organisation PLC (Information & Entertainment).................. 6,600 41,629
Redland PLC (Materials).............................................. 15,600 91,231
Reed International PLC (Information & Entertainment)................. 7,600 121,586
Reuters Holdings PLC (Industrial & Commercial)....................... 12,300 116,089
RMC Group PLC (Materials)............................................ 7,275 115,551
Royal Bank of Scotland Group (Finance)............................... 10,200 87,134
Royal Insurance Holdings PLC (Finance)............................... 6,700 39,901
RTZ Corp. PLC (Materials)............................................ 8,900 127,737
Sainsbury (J.) PLC (Consumer Discretionary).......................... 13,000 76,523
Scottish Power PLC (Utilities)....................................... 7,600 43,864
SmithKline Beecham PLC (Healthcare).................................. 8,000 85,058
SmithKline Beecham PLC (Healthcare)(2)............................... 7,950 83,492
Tesco PLC (Consumer Discretionary)................................... 13,952 61,302
Thames Water PLC (Industrial & Commercial)........................... 4,100 34,679
Thorn EMI PLC (Consumer Discretionary)............................... 3,900 92,992
Trafalgar House PLC (Multi-industry)................................. 8,900 3,270
Unilever PLC (Consumer Staples)...................................... 7,900 153,174
Vodafone Group PLC (Information Technology).......................... 7,400 26,396
Zeneca Group PLC ADR (Healthcare).................................... 5,900 119,093
-----------
5,121,251
-----------
</TABLE>

- ---------------------

64
<PAGE> 146
<TABLE>
<CAPTION>
COMMON STOCK (continued) SHARES VALUE
--------------------------------------------------------------------------------------------------
<S> <C> <C>
UNITED STATES--0.0%
United States Industries, Inc. (Multi-industry)...................... 169 $ 2,746
-----------
TOTAL COMMON STOCK (cost $43,375,684)................................ 44,189,371
-----------

PREFERRED STOCK--0.2%
--------------------------------------------------------------------------------------------------
GERMANY--0.2%
RWE AG (Utilities)................................................... 150 42,885
SAP AG (Materials)................................................... 300 47,335
-----------
90,220
-----------
ITALY--0.0%
Fiat SpA (Consumer Discretionary).................................... 11,000 19,122
-----------
TOTAL PREFERRED STOCK (cost $113,626)................................ 109,342
-----------
RIGHTS--0.0%+
--------------------------------------------------------------------------------------------------
GERMANY--0.0%
Munchener Ruckversicherungs (Finance)................................ 50 5,601
-----------
ITALY--0.0%
Olivetti ING C, & Co. (Information Technology)....................... 20,000 1,144
Riunione Adriatica di Sicur (Finance)................................ 250 907
-----------
2,051
-----------
TOTAL RIGHTS (cost $0)............................................... 7,652
-----------
WARRANTS--0.0%+
--------------------------------------------------------------------------------------------------
ITALY--0.0%
Riunione Adriatica di Sicur (Finance)................................ 150 264
-----------
MALAYSIA--0.0%
Hong Leong Properties (Real Estate)(1)............................... 500 0
-----------
TOTAL WARRANTS (cost $95)............................................ 264
-----------
TOTAL INVESTMENT SECURITIES (cost $43,489,405)....................... 44,306,629
-----------

PRINCIPAL
REPURCHASE AGREEMENT--6.0% AMOUNT
--------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--6.0%
Agreement with State Street Bank & Trust Co., bearing interest of
4.50% dated 11/30/95, to be repurchased 12/01/95 in the amount of
$2,940,368 and collateralized by $2,080,000 U.S. Treasury Bonds
12.00% due 5/15/05 (cost $2,940,000)............................... $2,940,000 2,940,000
-----------
TOTAL INVESTMENTS--
(cost $46,429,405) 96.5% 47,246,629
Other assets less liabilities-- 3.5 1,714,030
------ -----------
NET ASSETS-- 100.0% $48,960,659
====== ===========
</TABLE>

-----------------------------

+ Non-income producing securities

(1) Fair valued security; see Note 2

(2) Consists of more than one class of securities traded together
as a unit; generally bonds with attached stocks or warrants

---------------------

65
<PAGE> 147
<TABLE>
<CAPTION>
OPEN FORWARD FOREIGN CURRENCY CONTRACTS
-----------------------------------------------------------------------
CONTRACT IN DELIVERY GROSS UNREALIZED
TO DELIVER EXCHANGE FOR DATE APPRECIATION
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
*BEF 20,412,000 USD 723,573 04/30/96 $ 36,994
BEF 13,440,000 USD 476,427 04/30/96 21,043
*CHF 867,740 USD 759,044 01/04/96 20,857
CHF 584,126 USD 510,956 01/04/96 12,325
DEM 2,397,696 USD 1,680,000 01/04/96 19,239
FRF 7,355,600 USD 1,480,000 01/04/96 6,544
JPY 248,004,000 USD 2,490,000 01/04/96 39,438
JPY 179,454,990 USD 2,127,000 04/30/96 324,044
JPY 251,101,200 USD 2,685,000 04/30/96 162,226
JPY 344,664,320 USD 4,326,149 04/30/96 863,362
JPY 170,938,250 USD 1,855,000 08/14/96 113,181
JPY 122,773,950 USD 1,253,672 08/30/96 141,328
*JPY 53,685,680 USD 673,851 04/30/96 146,227
NLG 1,602,870 USD 1,001,836 07/31/96 48,469
*NLG 686,280 USD 449,695 07/31/96 25,882
*USD 675,000 BEF 20,412,000 04/30/96 11,579
*USD 420,000 NLG 686,280 07/31/96 3,813
----------------
1,996,551
----------------
GROSS UNREALIZED
DEPRECIATION
-----------------------------------------------------------------------
CHF 899,396 USD 740,000 02/28/96 $ (32,037)
*USD 765,000 CHF 867,740 01/04/96 (26,812)
*USD 652,000 JPY 53,685,680 04/30/96 (124,377)
USD 414,979 ESP 50,536,112 12/04/96 (4,966)
----------------
(188,192)
----------------
Net Unrealized Appreciation................. $1,808,359
================
</TABLE>

-----------------------------

* Represents open forward foreign currency contracts and
offsetting open forward foreign currency contracts that do not
have additional market risk but have continued counterparty
settlement risk.

<TABLE>
<S> <C> <C>
BEF--Belgian Franc ESP--Spanish Peseta NLG--Netherlands Guilder
USD--United States
CHF--Swiss Franc FRF--French Franc Dollar
DEM--Deutsche Mark JPY--Japanese Yen
</TABLE>

See Notes to Financial Statements

- ---------------------
66
<PAGE> 148

(This page intentionally left blank)

---------------------

67
<PAGE> 149

- ---------------------

SUNAMERICA SERIES TRUST
STATEMENT OF ASSETS AND LIABILITIES
NOVEMBER 30, 1995
<TABLE>
<CAPTION>
CASH FIXED HIGH-YIELD WORLDWIDE
MANAGEMENT INCOME GLOBAL BOND BOND HIGH INCOME
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investment securities, at value*.................. $ -- $28,718,327 $52,213,584 $77,635,215 $20,719,687
Short-term securities*............................ 92,708,313 189,622 8,281,000 -- --
Repurchase agreements (cost equals market)........ 973,000 8,212,000 -- -- 1,434,000
Cash.............................................. 799 153,943 395 20,910 60,425
Foreign currency.................................. -- -- 40 -- --
Receivables for--
Fund shares sold................................ 357,393 275,532 196,409 223,930 61,493
Dividends and accrued interest.................. 247,585 367,930 1,804,209 1,150,512 442,426
Sales of investments............................ -- 2,423,446 -- 4,251,771 252,146
Variation margin on futures contracts........... -- 10,158 -- -- --
Foreign currency contracts...................... -- -- -- -- --
Deferred organizational expenses.................. 15,584 8,602 8,603 8,325 1,798
Prepaid expenses.................................. 1,777 475 985 1,399 318
Unrealized appreciation on forward foreign
currency contracts.............................. -- -- 935,313 -- --
Due from adviser.................................. -- -- -- -- --
------------------------------------------------------------------------
94,304,451 40,360,035 63,440,538 83,292,062 22,972,293
------------------------------------------------------------------------
LIABILITIES:
Payables for--
Fund shares redeemed............................ 2,471,690 43,601 27,382 767,083 1,634
Purchases of investments........................ 1,006,937 10,803,012 3,253,872 -- 1,420,812
Management fees................................. 45,675 16,246 34,838 48,297 17,066
Variation margin on futures contracts........... -- -- -- -- --
Foreign currency contracts...................... -- -- -- -- --
Other accrued expenses............................ 48,956 22,656 35,975 303,015 17,701
Unrealized depreciation on forward foreign
currency contracts.............................. -- -- 329,427 -- --
Due to custodian bank............................. -- -- -- -- --
------------------------------------------------------------------------
3,573,258 10,885,515 3,681,494 1,118,395 1,457,213
------------------------------------------------------------------------
NET ASSETS........................................ $90,731,193 $29,474,520 $59,759,044 $82,173,667 $21,515,080
========================================================================
Shares of beneficial interest outstanding
(unlimited shares authorized)................... 8,483,049 2,724,189 5,424,420 7,806,335 1,884,528
Net asset value per share......................... $10.70 $10.82 $11.02 $10.53 $11.42
========================================================================
COMPOSITION OF NET ASSETS:
Capital paid in................................... $86,488,589 $28,058,530 $55,577,869 $83,135,134 $19,619,819
Accumulated undistributed net investment income
(loss).......................................... 4,234,947 1,219,884 3,620,109 7,410,940 1,431,913
Accumulated undistributed net realized gain (loss)
on investments, futures contracts and options
contracts....................................... 4,583 (355,354) (932,642) (9,037,804) 74,158
Unrealized appreciation on investments............ 3,074 511,571 916,086 665,397 389,190
Unrealized foreign exchange gain(loss) on other
assets and liabilities.......................... -- -- 577,622 -- --
Unrealized appreciation on futures contracts...... -- 39,889 -- -- --
------------------------------------------------------------------------
$90,731,193 $29,474,520 $59,759,044 $82,173,667 $21,515,080
========================================================================
---------------
* Cost
Investment securities........................... $ -- $28,206,756 $51,297,498 $76,969,818 $20,330,497
========================================================================
Short-term securities........................... $92,705,239 $ 189,622 $ 8,281,000 $ -- $ --
========================================================================
</TABLE>

See Notes to Financial Statements

- ---------------------

68
<PAGE> 150
<TABLE>
<CAPTION>
BALANCED/ GROWTH/
PHOENIX PHOENIX
INVESTMENT ASSET GROWTH- ALLIANCE INVESTMENT PROVIDENT VENTURE GLOBAL
COUNSEL ALLOCATION INCOME GROWTH COUNSEL GROWTH VALUE EQUITIES
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$28,405,803 $187,514,184 $170,021,383 $159,610,648 $137,276,227 $111,437,200 $139,942,029 $158,513,242
6,240,939 1,555,465 7,513,000 8,015,716 14,211,761 -- 16,997,439 10,230,000
-- 24,551,000 -- -- -- 2,633,000 -- --
-- 508,600 985 72,387 -- 916 -- 2,965
-- -- -- -- -- -- -- 351,092
100,774 1,282,427 359,840 1,945,004 906,183 328,870 1,182,040 226,762
148,159 1,311,720 394,878 115,715 54,298 44,282 200,648 484,192
153,850 6,253,168 -- 655,070 5,264,814 991,163 519,577 681,222
-- 33,671 -- -- -- -- -- --
-- -- -- -- -- -- -- 2,032,562
-- 8,603 8,325 8,325 8,901 8,325 -- 8,325
365 3,235 2,651 2,337 2,619 2,055 1,914 2,875
-- -- -- -- -- -- -- 123,525
-- -- -- -- -- -- -- --
---------------------------------------------------------------------------------------------------------------------------
35,049,890 223,022,073 178,301,062 170,425,202 157,724,803 115,445,811 158,843,647 172,656,762
---------------------------------------------------------------------------------------------------------------------------
2,085 71,256 122,346 264,506 39,618 40,945 18,383 41,395
1,879,526 22,926,295 6,748,269 2,140,913 3,253,574 -- 2,658,822 4,475,831
16,631 105,262 87,816 85,492 81,295 77,941 93,167 108,987
-- -- -- 3,600 -- -- -- --
-- -- -- -- -- -- -- 2,033,679
21,883 82,870 61,558 60,964 62,530 50,886 61,907 142,677
-- -- -- -- -- -- -- 102,496
701,230 -- -- -- 4,377,303 -- 1,103,371 --
---------------------------------------------------------------------------------------------------------------------------
2,621,355 23,185,683 7,019,989 2,555,475 7,814,320 169,772 3,935,650 6,905,065
---------------------------------------------------------------------------------------------------------------------------
$32,428,535 $199,836,390 $171,281,073 $167,869,727 $149,910,483 $115,276,039 $154,907,997 $165,751,697
===========================================================================================================================
2,598,706 15,689,067 12,490,023 10,739,380 11,411,801 8,800,227 11,503,467 12,693,039
$12.48 $12.74 $13.71 $15.63 $13.14 $13.10 $13.47 $13.06
===========================================================================================================================
$29,191,071 $171,257,566 $139,333,338 $134,009,237 $121,638,746 $ 90,389,835 $137,197,421 $149,050,688
399,630 5,029,483 1,673,393 477,396 1,261,039 -- 889,057 1,468,646
874,562 6,131,686 5,896,173 12,945,264 10,537,220 (3,161,237) 1,620,396 4,154,885
1,963,272 17,322,705 24,378,169 20,341,080 16,473,499 28,047,441 15,201,123 11,048,831
-- -- -- -- (21) -- -- 28,647
-- 94,950 -- 96,750 -- -- -- --
---------------------------------------------------------------------------------------------------------------------------
$32,428,535 $199,836,390 $171,281,073 $167,869,727 $149,910,483 $115,276,039 $154,907,997 $165,751,697
===========================================================================================================================
$26,442,531 $170,194,711 $145,643,214 $139,269,571 $120,802,728 $ 83,389,759 $124,740,906 $147,464,411
===========================================================================================================================
$ 6,240,939 $ 1,552,233 $ 7,513,000 $ 8,015,713 $ 14,211,761 $ -- $ 16,997,439 $ 10,230,000
===========================================================================================================================

INTERNATIONAL
DIVERSIFIED
EQUITIES
-------------
<S> <C>
$44,306,629
--
2,940,000
12,807
27,361
275,200
137,650
--
--
--
1,797
708
1,996,551
23,550
-----------
49,722,253
-----------
25,020
424,485
37,911
--
--
85,986
188,192
--
-----------
761,594
-----------
$48,960,659
===========
4,824,929
$10.15
===========
$47,266,486
(346,916)
(586,233)
817,224
1,810,098
--
-----------
$48,960,659
===========
$43,489,405
===========
$ --
===========
</TABLE>

---------------------

69
<PAGE> 151

- ---------------------

SUNAMERICA SERIES TRUST
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED NOVEMBER 30, 1995
<TABLE>
<CAPTION>
WORLDWIDE
CASH FIXED GLOBAL HIGH-YIELD HIGH
MANAGEMENT INCOME BOND BOND INCOME
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Income:
Dividends.............................................. $ -- $ -- $ -- $ -- $ --
Interest............................................... 4,772,033 1,423,770 3,341,934 8,087,552 1,691,603
----------------------------------------------------------
Total income *..................................... 4,772,033 1,423,770 3,341,934 8,087,552 1,691,603
----------------------------------------------------------
Expenses:
Management fees........................................ 438,400 144,546 365,313 478,203 143,765
Custodian fees......................................... 39,740 38,690 69,310 39,905 22,720
Auditing fees.......................................... 22,575 6,245 10,865 13,965 10,800
Reports to investors................................... 9,420 3,505 7,370 10,995 2,170
Amortization of organizational expenses................ 7,172 3,953 3,953 3,822 1,887
Legal fees............................................. 5,400 1,190 3,640 4,525 1,030
Trustees' fees......................................... 2,645 60 1,435 1,835 480
Interest expense....................................... -- -- -- 2,898 --
Other expenses......................................... 5,176 2,683 3,805 4,509 5,287
----------------------------------------------------------
Total expenses before reimbursement.................. 530,528 200,872 465,691 560,657 188,139
Expenses reimbursed by the investment adviser........ -- (1,770) -- -- (649)
----------------------------------------------------------
Net investment income (loss)............................. 4,241,505 1,224,668 2,876,243 7,526,895 1,504,113
----------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCIES:
Net realized gain (loss) on investments@............... 5,110 581,976 1,618,834 (3,711,235) 76,600
Net realized gain (loss) on futures and options
contracts............................................ -- 13,918 -- -- --
Net realized foreign exchange gain (loss) on other
assets and liabilities............................... -- -- 1,319,839 -- --
Change in unrealized appreciation/depreciation on
investments.......................................... 44,053 1,262,150 1,593,149 4,427,627 484,883
Change in unrealized foreign exchange gain (loss) on
other assets and liabilities......................... -- -- 1,814 -- --
Change in unrealized appreciation/depreciation on
futures contracts.................................... -- 39,889 -- -- --
----------------------------------------------------------
Net realized and unrealized gain on investments and
foreign currencies................................... 49,163 1,897,933 4,533,636 716,392 561,483
----------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.... $4,290,668 $3,122,601 $7,409,879 $8,243,287 $2,065,596
==========================================================
</TABLE>

-------------------
* Net of foreign withholding taxes on interest and dividends of $66,
$1,816, $3,636, $2,245 $20,557, $6,965, $5,619, $269,136 and $85,357 on
the Balanced/Phoenix Investment Counsel, Asset Allocation, Growth-Income,
Alliance Growth, Growth/Phoenix Investment Counsel, Provident Growth,
Venture Value, Global Equities and International Diversified Equities
Portfolios, respectively.

@ Net of foreign withholding taxes on capital gains of $18,009 on the Global
Equities Portfolio.

See Notes to Financial Statements

- ---------------------

70
<PAGE> 152
<TABLE>
<CAPTION>
BALANCED/ GROWTH/
PHOENIX PHOENIX INTERNATIONAL
INVESTMENT ASSET GROWTH- ALLIANCE INVESTMENT PROVIDENT VENTURE GLOBAL DIVERSIFIED
COUNSEL ALLOCATION INCOME GROWTH COUNSEL GROWTH VALUE EQUITIES EQUITIES
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 94,209 $2,163,433 $2,168,076 $1,029,948 $1,295,073 $ 583,781 $1,048,621 $2,679,270 $ 561,748
441,028 4,342,880 414,143 198,205 920,009 252,521 489,585 397,172 135,681
-----------------------------------------------------------------------------------------------------------------
535,237 6,506,313 2,582,219 1,228,153 2,215,082 836,302 1,538,206 3,076,442 697,429
-----------------------------------------------------------------------------------------------------------------
92,499 1,000,248 794,078 635,979 835,634 785,809 504,014 1,185,831 283,908
34,395 94,115 41,745 44,345 49,400 40,845 79,040 362,550 279,268
11,565 34,670 28,795 29,030 23,975 21,070 31,700 26,775 15,720
3,690 32,210 21,810 20,110 20,325 16,235 19,075 25,305 6,025
360 3,953 3,822 3,822 3,822 3,822 360 3,822 1,887
765 9,435 7,210 6,185 7,990 6,000 4,185 9,505 1,455
405 4,680 3,640 2,915 3,710 2,685 1,975 4,575 920
-- -- -- -- -- -- -- -- --
2,248 6,280 5,559 4,235 6,589 5,094 3,098 7,879 5,487
-----------------------------------------------------------------------------------------------------------------
145,927 1,185,591 906,659 746,621 951,445 881,560 643,447 1,626,242 594,670
(17,031) -- -- -- -- -- (9,792) -- (112,030)
-----------------------------------------------------------------------------------------------------------------
406,341 5,320,722 1,675,560 481,532 1,263,637 (45,258) 904,551 1,450,200 214,789
-----------------------------------------------------------------------------------------------------------------
875,469 6,792,943 6,546,892 13,305,824 19,383,952 240,218 1,620,396 5,003,696 (585,776)
-- 37,040 -- 47,744 -- -- -- (524,955) --
-- -- 76 -- 701 -- -- 720,956 (506,494)
1,971,928 20,689,780 26,098,737 21,063,685 14,865,880 25,016,207 15,272,123 13,392,395 1,120,932
-- -- -- -- (21) -- -- 15,377 1,810,094
-- 94,950 -- 96,750 -- -- -- 182,708 --
-----------------------------------------------------------------------------------------------------------------
2,847,397 27,614,713 32,645,705 34,514,003 34,250,512 25,256,425 16,892,519 18,790,177 1,838,756
-----------------------------------------------------------------------------------------------------------------
$3,253,738 $32,935,435 $34,321,265 $34,995,535 $35,514,149 $25,211,167 $17,797,070 $20,240,377 $2,053,545
==================================================================================================================
</TABLE>

---------------------

71
<PAGE> 153

- ---------------------

SUNAMERICA SERIES TRUST
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED NOVEMBER 30, 1995
<TABLE>
<CAPTION>
CASH FIXED HIGH-YIELD WORLDWIDE
MANAGEMENT INCOME GLOBAL BOND BOND HIGH INCOME
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income (loss)................... $ 4,241,505 $ 1,224,668 $ 2,876,243 $ 7,526,895 $1,504,113
Net realized gain (loss) on investments........ 5,110 581,976 1,618,834 (3,711,235) 76,600
Net realized gain (loss) on futures and options
contracts.................................... -- 13,918 -- -- --
Net realized foreign exchange gain (loss) on
other assets and liabilities................. -- -- 1,319,839 -- --
Change in unrealized appreciation/depreciation
on investments............................... 44,053 1,262,150 1,593,149 4,427,627 484,883
Change in unrealized foreign exchange gain
(loss) on other assets and liabilities....... -- -- 1,814 -- --
Change in unrealized appreciation/depreciation
on futures contracts......................... -- 39,889 -- -- --
--------------------------------------------------------------------
Net increase in net assets resulting from
operations................................... 4,290,668 3,122,601 7,409,879 8,243,287 2,065,596
--------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income......... (2,210,000) (885,000) (1,700,000) (6,340,000) (114,929)
Distributions from net realized gain on
investments................................ -- -- -- -- --
--------------------------------------------------------------------
Total dividends and distributions to
shareholders................................. (2,210,000) (885,000) (1,700,000) (6,340,000) (114,929)
--------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold...................... 415,378,253 22,925,314 22,230,068 70,702,486 13,740,334
Proceeds from shares issued for reinvestment of
dividends and distributions.................. 2,210,000 885,000 1,700,000 6,340,000 114,929
Cost of shares repurchased..................... (418,035,564) (12,442,153) (14,423,490) (52,574,843) (4,768,369)
--------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from capital share transactions.............. (447,311) 11,368,161 9,506,578 24,467,643 9,086,894
--------------------------------------------------------------------
TOTAL INCREASE IN NET ASSETS................... 1,633,357 13,605,762 15,216,457 26,370,930 11,037,561
NET ASSETS:
Beginning of year.............................. 89,097,836 15,868,758 44,542,587 55,802,737 10,477,519
--------------------------------------------------------------------
End of year.................................... $ 90,731,193 $29,474,520 $59,759,044 $82,173,667 $21,515,080
====================================================================
---------------
Undistributed net investment income (loss)..... $ 4,234,947 $ 1,219,884 $ 3,620,109 $ 7,410,940 $ 1,431,913
====================================================================
Shares issued and repurchased:
Sold........................................... 39,465,595 2,218,395 2,131,775 6,846,915 1,299,782
Issued in reinvestment of dividends and
distributions................................ 214,355 90,306 170,000 648,925 11,873
Repurchased.................................... (39,709,537) (1,212,881) (1,407,509) (5,097,408) (480,433)
--------------------------------------------------------------------
Net increase (decrease)........................ (29,587) 1,095,820 894,266 2,398,432 831,222
====================================================================
</TABLE>

See Notes to Financial Statements

- ---------------------

72
<PAGE> 154
<TABLE>
<CAPTION>
BALANCED/ GROWTH/
PHOENIX PHOENIX INTERNATIONAL
INVESTMENT ASSET GROWTH- ALLIANCE INVESTMENT PROVIDENT VENTURE GLOBAL DIVERSIFIED
COUNSEL ALLOCATION INCOME GROWTH COUNSEL GROWTH VALUE EQUITIES EQUITIES
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 406,341 $ 5,320,722 $ 1,675,560 $ 481,532 $ 1,263,637 $ (45,258) $ 904,551 $ 1,450,200 $ 214,789
875,469 6,792,943 6,546,892 13,305,824 19,383,952 240,218 1,620,396 5,003,696 (585,776)
-- 37,040 -- 47,744 -- -- -- (524,955) --
-- -- 76 -- 701 -- -- 720,956 (506,494)
1,971,928 20,689,780 26,098,737 21,063,685 14,865,880 25,016,207 15,272,123 13,392,395 1,120,932
-- -- -- -- (21) -- -- 15,377 1,810,094
-- 94,950 -- 96,750 -- -- -- 182,708 --
---------------------------------------------------------------------------------------------------------------------------
3,253,738 32,935,435 34,321,265 34,995,535 35,514,149 25,211,167 17,797,070 20,240,377 2,053,545
---------------------------------------------------------------------------------------------------------------------------
(11,237) (2,240,000) (875,000) (155,000) (1,450,000) (200,000) (23,311) (855,000) (121,869)
-- (425,000) -- (725,000) -- -- -- (3,190,000) --
---------------------------------------------------------------------------------------------------------------------------
(11,237) (2,665,000) (875,000) (880,000) (1,450,000) (200,000) (23,311) (4,045,000) (121,869)
---------------------------------------------------------------------------------------------------------------------------
30,928,111 91,078,058 79,200,929 168,074,086 45,890,799 46,200,686 164,118,300 79,044,610 58,139,793
11,237 2,665,000 875,000 880,000 1,450,000 200,000 23,311 4,045,000 121,869
(3,269,069) (31,032,947) (27,140,302) (88,413,178) (35,688,009) (31,477,920) (31,455,895) (70,291,038) (23,670,269)
---------------------------------------------------------------------------------------------------------------------------
27,670,279 62,710,111 52,935,627 80,540,908 11,652,790 14,922,766 132,685,716 12,798,572 34,591,393
---------------------------------------------------------------------------------------------------------------------------
30,912,780 92,980,546 86,381,892 114,656,443 45,716,939 39,933,933 150,459,475 28,993,949 36,523,069
1,515,755 106,855,844 84,899,181 53,213,284 104,193,544 75,342,106 4,448,522 136,757,748 12,437,590
---------------------------------------------------------------------------------------------------------------------------
$32,428,535 $199,836,390 $171,281,073 $167,869,727 $149,910,483 $115,276,039 $154,907,997 $165,751,697 $48,960,659
===========================================================================================================================
$ 399,630 $ 5,029,483 $ 1,673,393 $ 477,396 $ 1,261,039 $ -- $ 889,057 $ 1,468,646 $ (346,916)
===========================================================================================================================
2,742,183 7,788,903 6,452,877 12,084,699 4,046,435 3,971,874 13,646,177 6,436,345 6,011,154
1,132 243,157 77,502 76,126 135,387 18,536 2,359 357,648 12,721
(296,843) (2,699,219) (2,260,341) (6,421,749) (3,175,785) (2,684,472) (2,599,805) (5,815,859) (2,470,598)
---------------------------------------------------------------------------------------------------------------------------
2,446,472 5,332,841 4,270,038 5,739,076 1,006,037 1,305,938 11,048,731 978,134 3,553,277
===========================================================================================================================
</TABLE>

---------------------

73
<PAGE> 155

- ---------------------

SUNAMERICA SERIES TRUST
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED NOVEMBER 30, 1994
<TABLE>
<CAPTION>
WORLDWIDE
CASH FIXED GLOBAL HIGH-YIELD HIGH
MANAGEMENT INCOME BOND BOND INCOME*
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
OPERATIONS:
Net investment income.......................... $ 2,204,504 $ 877,613 $ 2,056,427 $ 6,224,934 $ 42,729
Net realized gain (loss) on investments........ (527) (897,488) (2,571,262) (5,326,569) (2,442)
Net realized gain (loss) on futures and options
contracts.................................... -- -- (28,936) -- --
Net realized foreign exchange gain (loss) on
other assets and liabilities................. -- -- (887,865) -- --
Change in unrealized appreciation/depreciation
on investments............................... (40,979) (658,964) (296,847) (3,751,081) (95,693)
Change in unrealized foreign exchange gain
(loss) on other assets and liabilities....... -- -- 412,079 -- --
Change in unrealized appreciation/depreciation
on futures contracts......................... -- -- -- -- --
------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations.............................. 2,162,998 (678,839) (1,316,404) (2,852,716) (55,406)
------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income......... (294,500) (98,500) (342,000) (1,505,500) --
Distributions from net realized gain on
investments................................ -- (71,794) (187,458) (294,750) --
------------------------------------------------------------------------
Total dividends and distributions to
shareholders................................. (294,500) (170,294) (529,458) (1,800,250) --
------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold...................... 269,001,242 22,698,651 36,121,308 57,807,375 10,551,001
Proceeds from shares issued for reinvestment of
dividends and distributions.................. 294,500 170,294 529,458 1,800,250 --
Cost of shares repurchased..................... (206,669,280) (17,818,535) (15,272,111) (41,002,709) (18,076)
------------------------------------------------------------------------
Net increase in net assets resulting from
capital share transactions................... 62,626,462 5,050,410 21,378,655 18,604,916 10,532,925
------------------------------------------------------------------------
TOTAL INCREASE IN NET ASSETS................... 64,494,960 4,201,277 19,532,793 13,951,950 10,477,519
NET ASSETS:
Beginning of period............................ 24,602,876 11,667,481 25,009,794 41,850,787 0
------------------------------------------------------------------------
End of period.................................. $ 89,097,836 $ 15,868,758 $ 44,542,587 $ 55,802,737 $10,477,519
========================================================================
---------------
Undistributed net investment income............ $ 2,203,442 $ 882,067 $ 1,143,813 $ 6,224,045 $ 42,729
========================================================================
Shares issued and repurchased:
Sold........................................... 26,101,794 2,269,964 3,580,326 5,298,745 1,055,117
Issued in reinvestment of dividends and
distributions................................ 28,873 17,149 53,427 163,362 --
Repurchased.................................... (20,030,209) (1,803,912) (1,531,719) (3,819,032) (1,811)
------------------------------------------------------------------------
Net increase................................... 6,100,458 483,201 2,102,034 1,643,075 1,053,306
========================================================================
</TABLE>

* Commenced operations October 28, 1994

See Notes to Financial Statements

- ---------------------

74
<PAGE> 156
<TABLE>
<CAPTION>
BALANCED/ GROWTH/
PHOENIX PHOENIX INTERNATIONAL
INVESTMENT ASSET GROWTH- ALLIANCE INVESTMENT PROVIDENT VENTURE GLOBAL DIVERSIFIED
COUNSEL* ALLOCATION INCOME GROWTH COUNSEL GROWTH VALUE* EQUITIES EQUITIES*
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$ 4,526 $ 2,079,263 $ 873,663 $ 151,776 $ 1,447,313 $ 194,453 $ 7,817 $ 439,686 $ 16,284
(907) (219,928) (636,783) 333,777 (8,005,593) (3,106,757) -- 1,537,529 --
-- 1,189 -- -- -- -- -- (370,832) --
-- -- -- -- -- -- -- 1,428,760 49,917
(8,656) (3,516,746) (2,491,416) (1,181,114) (973,025) 2,410,066 (71,000) (1,615,837) (303,708)
-- -- -- -- -- -- -- 28,609 4
-- 18,875 -- -- -- -- -- (182,708) --
--------------------------------------------------------------------------------------------------------------------------
(5,037) (1,637,347) (2,254,536) (695,561) (7,531,305) (502,238) (63,183) 1,265,207 (237,503)
--------------------------------------------------------------------------------------------------------------------------
-- (297,500) (246,500) (47,000) (519,500) (55,000) -- (41,500) --
-- (156,839) (43,923) (604,808) -- -- -- (522,781) --
--------------------------------------------------------------------------------------------------------------------------
-- (454,339) (290,423) (651,808) (519,500) (55,000) -- (564,281) --
--------------------------------------------------------------------------------------------------------------------------
1,521,140 87,819,488 59,410,366 49,449,776 68,645,462 46,577,399 4,758,696 153,578,193 12,781,226
-- 454,339 290,423 651,808 519,500 55,000 -- 564,281 --
(348) (14,916,201) (17,336,891) (18,796,458) (21,953,015) (13,643,955) (246,991) (61,822,290) (106,133)
--------------------------------------------------------------------------------------------------------------------------
1,520,792 73,357,626 42,363,898 31,305,126 47,211,947 32,988,444 4,511,705 92,320,184 12,675,093
--------------------------------------------------------------------------------------------------------------------------
1,515,755 71,265,940 39,818,939 29,957,757 39,161,142 32,431,206 4,448,522 93,021,110 12,437,590
0 35,589,904 45,080,242 23,255,527 65,032,402 42,910,900 0 43,736,638 0
--------------------------------------------------------------------------------------------------------------------------
$1,515,755 $106,855,844 $ 84,899,181 $ 53,213,284 $104,193,544 $ 75,342,106 $4,448,522 $136,757,748 $12,437,590
==========================================================================================================================
$ 4,526 $ 1,948,761 $ 872,833 $ 150,864 $ 1,446,701 $ 193,602 $ 7,817 $ 196,485 $ 66,201
==========================================================================================================================
152,269 8,292,654 5,595,922 4,589,555 6,425,534 4,560,014 480,157 12,891,831 1,282,522
-- 42,422 27,322 58,987 47,098 5,268 -- 47,983 --
(35) (1,415,441) (1,653,770) (1,778,224) (2,099,136) (1,344,321) (25,421) (5,205,577) (10,870)
--------------------------------------------------------------------------------------------------------------------------
152,234 6,919,635 3,969,474 2,870,318 4,373,496 3,220,961 454,736 7,734,237 1,271,652
==========================================================================================================================
</TABLE>

---------------------

75
<PAGE> 157
- ---------------------

SUNAMERICA SERIES TRUST
NOTES TO FINANCIAL STATEMENTS

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION: SunAmerica Series Trust
(the "Trust"), organized as a Massachusetts business trust on September 11,
1992, is an open-end management investment company. It was established to
provide a funding medium for certain annuity contracts issued by Variable
Separate Account (the "Account"), a separate account of Anchor National Life
Insurance Company ("Life Company"), organized under the laws of the state of
Arizona.

The Trust issues 14 separate series of shares ("Portfolios"), each of which
represents a separate managed portfolio of securities with its own investment
objectives. The Board of Trustees may establish additional series in the future.
The current Portfolios are the Cash Management Portfolio, Fixed Income
Portfolio, Global Bond Portfolio, High-Yield Bond Portfolio, Worldwide High
Income Portfolio, Balanced/Phoenix Investment Counsel Portfolio, Asset
Allocation Portfolio, Growth-Income Portfolio, Alliance Growth Portfolio,
Growth/Phoenix Investment Counsel Portfolio, Provident Growth Portfolio, Venture
Value Portfolio, Global Equities Portfolio and International Diversified
Equities Portfolio. All shares may be purchased or redeemed by the Account at
net asset value without any sales or redemption charge.

In the opinion of management of the Trust, the accompanying financial
statements contain all normal and recurring adjustments necessary for the fair
presentation of the financial position of the Trust at November 30, 1995, and
the results of its operations, the changes in its net assets and its financial
highlights for the period then ended.

2. SIGNIFICANT ACCOUNTING POLICIES: Following is a summary of significant
accounting policies consistently followed by the Trust in the preparation of its
financial statements.

SECURITY VALUATIONS: Stocks are stated at value based upon closing sales
prices reported on recognized securities exchanges or, for listed securities
having no sales reported and for unlisted securities, upon last-reported bid
prices. Nonconvertible bonds, debentures, and other long-term debt securities
are valued at prices obtained for the day of valuation from a bond pricing
service of a major dealer in bonds when such prices are available; however, in
circumstances where the investment adviser deems it appropriate to do so, an
over-the-counter or exchange quotation at the mean of representative bid or
asked prices may be used. Securities traded primarily on securities exchanges
outside the United States are valued at the last sale price on such exchanges on
the day of valuation, or if there is no sale on the day of valuation, at the
last reported bid price. Short-term securities with original or remaining
maturities in excess of 60 days are valued at the mean of their quoted bid and
ask prices. Short-term securities with 60 days or less to maturity are amortized
to maturity based on their cost to the Trust if acquired within 60 days of
maturity or, if already held by the Trust on the 60th day, are amortized to
maturity based on the value determined on the 61st day. Securities for which
quotations are not readily available are valued at fair value as determined in
good faith under the direction of the Trust's Trustees.

REPURCHASE AGREEMENTS: The Trust's custodian takes possession of the
collateral pledged for investments in repurchase agreements. The underlying
collateral is valued daily on a mark-to-market basis to assure 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 Trust has the right to
liquidate the collateral and apply the proceeds in satisfaction of the
obligation. If the seller defaults and the value of the collateral declines or
if bankruptcy proceedings are commenced with respect to the seller of the
security, realization of the collateral by the Trust may be delayed or limited.

FOREIGN CURRENCY TRANSLATION: The books and records of the Trust are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars at published rates on the following basis:

(i) market value of investment securities, other assets and liabilities at the
prevailing rate of exchange at the valuation date.

(ii) purchases and sales of investment securities, income and expenses at the
rate of exchange prevailing on the respective dates of such transactions.

Assets and liabilities denominated in foreign currencies and commitments under
forward foreign currency contracts are translated into U.S. dollars at the mean
of the quoted bid and asked prices of such currencies against the U.S. dollar.
Purchases and sales of portfolio securities are translated at the rate of
exchange prevailing when such securities were acquired or sold. Income and
expenses are translated at rates of exchange prevailing when earned or incurred.

The Trust does not isolate that portion of the results of operations arising
as a result of changes in the foreign exchange rates from the changes in the
market prices of securities held at fiscal year-end. The Trust does not isolate
the effect of changes in foreign exchange rates from the changes in the market
prices of portfolio securities sold during the year.

- ---------------------
76
<PAGE> 158

Realized foreign exchange gain (loss) on other assets and liabilities and
change in unrealized foreign exchange gain (loss) on other assets and
liabilities include realized foreign exchange gains and losses from currency
gains or losses realized between the trade and settlement dates of securities
transactions, dividends received, the difference between the amounts of
interest, discount and foreign withholding taxes recorded on the Trust's books
and the U.S. dollar equivalent amounts actually received or paid and changes in
the unrealized foreign exchange gains and losses relating to the other assets
and liabilities arising as a result of changes in the exchange rate.

FUTURES CONTRACTS: A futures contract is an agreement between two parties to
buy and sell a security at a set price on a future date. Upon entering into such
a contract the Trust is required to pledge to the broker an amount of cash or
U.S. government securities equal to the minimum "initial margin" requirements of
the exchange on which the futures contract is traded. The contract amount
reflects the extent of a portfolio's exposure in these financial instruments. A
portfolio's participation in the futures markets involves certain risks,
including imperfect correlation between movements in the price of futures
contracts and movements in the price of the securities hedged or used for cover.
The Trust's activities in the futures contracts are conducted through regulated
exchanges which do not result in counterparty credit risks. Pursuant to a
contract, the portfolios agree to receive from or pay to the broker an amount of
cash equal to the daily fluctuation in value of the contract. Such receipts or
payments are known as "variation margin" and are recorded by the portfolios as
unrealized appreciation or depreciation. When a contract is closed, the
portfolios record a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it was
closed.

SECURITIES TRANSACTIONS, DIVIDENDS, INVESTMENT INCOME AND EXPENSES: As is
customary in the mutual fund industry, securities transactions are accounted for
on the date the securities are purchased or sold. Interest income is accrued
daily except when collection is not expected. Dividend income and distributions
to shareholders are recorded on the ex-dividend date except for certain
dividends from foreign securities, which are recorded as soon as the Trust is
informed after the ex-dividend date. The Trust amortizes premiums and accretes
discounts on fixed income securities, as well as those original issue discounts
for which amortization is required for federal income tax purposes; gains and
losses realized upon the sale of such securities are based on their identified
cost. Portfolios which earn foreign income and capital gains may be subject to
foreign withholding taxes at various rates.

The Fund records dividends and distributions to its shareholders on the
ex-dividend date. The amount of dividends and distributions from net investment
income and net realized capital gains are determined and presented in accordance
with federal income tax regulations, which may differ from generally accepted
accounting principles. These "book/tax" differences are either considered
temporary or permanent in nature. To the extent these differences are permanent
in nature, such amounts are reclassified within the capital accounts based on
their federal tax-basis treatment; temporary differences do not require
reclassification. Dividends and distributions which exceed net investment income
and net realized capital gains for financial reporting purposes but not for tax
purposes are reported as dividends in excess of net investment income or
distributions in excess of net realized capital gains. To the extent
distributions exceed current and accumulated earnings and profits for federal
income tax purposes, they are reported as distributions of paid-in capital.

Common expenses incurred by the Trust are allocated among the portfolios based
upon relative net assets. In all other respects, expenses are charged to each
series as incurred on a specific identification basis.

STATEMENT OF POSITION 93-2: In accordance with the requirements of Statement
of Position 93-2 Determination, Disclosure, and Financial Statement Presentation
of Income, Capital Gain, and Return of Capital Distributions by Investment
Companies permanent book-tax differences relating to shareholder distributions
have been reclassified to paid-in-capital. Net investment income/loss, net
realized gain/loss, and net assets were not affected by this change.

For the year ended November 30, 1995, the reclassification arising from
book/tax differences resulted in increases (decreases) to the components of net
assets as follows:
<TABLE>
<CAPTION>
ACCUMULATED ACCUMULATED
UNDISTRIBUTED NET UNDISTRIBUTED NET
INVESTMENT INCOME/(LOSS) REALIZED GAIN/(LOSS) PAID-IN CAPITAL
----------------------------------------------------------------------
<S> <C> <C> <C>
Fixed Income....................................... $ (1,851) $ 1,851 $ --
Global Bond........................................ 1,300,053 (1,271,117) (28,936)
Growth/Phoenix Investment Counsel.................. 701 (701) --
Provident Growth................................... 51,656 -- (51,656)
Global Equities.................................... 676,961 (676,961) --
International Diversified Equities................. (506,037) 506,037 --
</TABLE>

3. JOINT REPURCHASE AGREEMENT ACCOUNT: The Cash Management Portfolio along with
other affiliated registered investment companies, transfers uninvested cash
balances into a single joint account, the daily aggregate balance of which is
invested in one or more repurchase agreements collateralized by U.S. Treasury or
federal agency obligations. As of November 30, 1995, the Cash Management
Portfolio had a 0.9% undivided interest, which represented $973,000 in principal
amount in a repurchase agreement in the joint account. As of such date, the
repurchase agreement in the joint account and the collateral therefor was as
follows:

---------------------
77
<PAGE> 159

Yamaichi International (America), Inc. Repurchase Agreement, 5.91% dated
11/30/95, in the principal amount of $109,857,000 repurchase price $109,875,035
due 12/1/95 collateralized by $50,000,000 U.S. Treasury Bonds 7.25% due 8/15/22;
$39,550,000 U.S. Treasury Bonds 7.25% due 8/15/22 and $8,095,000 U.S. Treasury
Bonds 8.125% due 8/15/19, approximate aggregate value $114,116,023.

4. FEDERAL INCOME TAXES: The Trust intends to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and
distribute all of its taxable income, including any net realized gain on
investments, to its shareholders. Therefore, no federal tax provision is
required.

The amounts of aggregate unrealized gain (loss) and the cost of investment
securities, including short-term securities, were as follows:
<TABLE>
<CAPTION>
AGGREGATE AGGREGATE UNREALIZED CAPITAL
UNREALIZED UNREALIZED GAIN/(LOSS) COST OF CAPITAL LOSS LOSS
GAIN (LOSS) NET INVESTMENTS CARRYOVER* UTILIZED
---------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Cash Management......................... $ 22,796 $ (19,722) $ 3,074 $93,678,239 $ -- $ 527
Fixed Income............................ 523,918 (49,521) 474,397 36,645,552 291,703 503,104
Global Bond............................. 1,062,262 (189,241) 873,021 59,621,563 889,577 1,582,879
High-Yield Bond......................... 2,970,068 (2,332,406) 637,662 76,997,553 9,010,069 --
Worldwide High Income................... 688,226 (314,837) 373,389 21,780,298 -- --
Balanced/Phoenix Investment Counsel..... 2,077,243 (116,901) 1,960,342 32,686,400 -- --
Asset Allocation........................ 18,243,650 (920,945) 17,322,705 196,297,944 -- --
Growth-Income........................... 26,484,213 (2,175,094) 24,309,119 153,225,264 -- 198,016
Alliance Growth......................... 21,936,834 (1,733,725) 20,203,109 147,423,255 -- --
Growth/Phoenix Investment Counsel**..... 18,342,283 (1,868,784) 16,473,499 135,014,489 -- 7,941,298
Provident Growth........................ 30,335,810 (2,288,369) 28,047,441 86,022,759 3,161,237 23,425
Venture Value........................... 16,036,378 (835,255) 15,201,123 141,738,345 -- --
Global Equities***...................... 15,559,437 (4,898,890) 10,660,547 158,082,695 -- --
International Diversified Equities...... 2,250,789 (1,433,565) 817,224 46,809,792 211,683 --
</TABLE>

* Expire 2002 - 2003

** Post 10/31 Capital Loss Deferrals: Alliance Growth $12,517; Growth/Phoenix
Investment Counsel $96,044

*** Post 10/31 Currency Loss Deferrals: Global Equities $313,344

5. MANAGEMENT OF THE TRUST: SunAmerica Asset Management Corp. ("SAAMCo" or the
"Adviser"), an indirect wholly owned subsidiary of the Life Company, serves as
investment adviser for all the portfolios of the Trust. The Trust, on behalf of
each Portfolio, entered into an Investment Advisory and Management Agreement
(the "Agreement") with SAAMCo to handle the Trust's day-to-day affairs. It is
the responsibility of the Adviser and for certain Portfolios pursuant to
Subadvisory Agreements described below, the subadvisers, to make investment
decisions for the Portfolios and to place the purchase and sale orders for the
Portfolio transactions. Such orders may be directed to any broker including, in
the manner and to the extent permitted by applicable law, affiliates of the
Adviser or a subadviser. The Agreement provides that SAAMCo shall administer the
Trust's business affairs; furnish offices, necessary facilities and equipment;
provide clerical, bookkeeping and administrative services; and permit any of its
officers or employees to serve, without compensation, as trustees or officers of
the Trust, if duly elected to such positions. There is no subadviser for the
High-Yield Bond Portfolio or the Cash Management Portfolio, and SAAMCo,
therefore, performs all investment advisory services for these Portfolios. The
term "Assets" means the average daily net assets of the portfolios.

- ---------------------
78
<PAGE> 160

The Trust pays SAAMCo a monthly fee calculated daily at the following annual
percentages of each Portfolio's Assets:
<TABLE>
<CAPTION>
MANAGEMENT
PORTFOLIO ASSETS FEES
- ---------------------------------------------------------
<S> <C> <C>
Cash Management $0--$100 million 0.55%
> $100 million 0.50%
> $300 million 0.45%
Fixed Income $0--$ 50 million 0.70%
> $ 50 million 0.60%
> $150 million 0.55%
> $250 million 0.50%
Global Bond- $0--$ 50 million 0.75%
Asset Allocation > $ 50 million 0.65%
> $150 million 0.60%
> $250 million 0.55%
High-Yield Bond $0--$ 50 million 0.70%
> $ 50 million 0.65%
> $150 million 0.60%
> $250 million 0.55%
Worldwide High > $ 0 1.00%
Income- International
Diversified Equities

<CAPTION>
MANAGEMENT
PORTFOLIO ASSETS FEES
- ---------------------------------------------------------
<S> <C> <C>
Balanced/Phoenix $0--$ 50 million 0.70%
Investment Counsel- > $ 50 million 0.65%
Growth-Income- > $150 million 0.60%
Alliance Growth- > $300 million 0.55%
Growth/Phoenix > $500 million 0.50%
Investment Counsel
Provident Growth $0--$ 50 million 0.85%
> $ 50 million 0.80%
> $150 million 0.70%
> $250 million 0.65%
> $350 million 0.60%
Venture Value $0--$100 million 0.80%
> $100 million 0.75%
> $500 million 0.70%
Global Equities $0--$ 50 million 0.90%
> $ 50 million 0.80%
> $150 million 0.70%
> $300 million 0.65%
</TABLE>

The organizations described below act as subadvisers to the Trust and certain
of its Portfolios pursuant to Subadvisory Agreements with SAAMCo. Under the
Subadvisory Agreements, the subadvisers manage the investment and reinvestment
of the assets of the respective Portfolios for which they are responsible. Each
of the subadvisers is independent of SAAMCo and discharges it responsibilities
subject to the policies of the Trustees and the oversight and supervision of
SAAMCo, which pays the subadvisers' fees.

Alliance Capital Management L.P. serves as subadviser for the Global Equities,
Alliance Growth and Growth-Income Portfolios; Phoenix Investment Counsel, Inc.
serves as subadviser for the Growth/Phoenix Investment Counsel and Balanced/
Phoenix Investment Counsel Portfolios; Provident Investment Counsel serves as
subadviser for the Provident Growth Portfolio; Goldman Sachs Asset Management, a
separate operating division of Goldman Sachs & Co., serves as subadviser for the
Asset Allocation and Fixed Income Portfolios; Goldman Sachs Asset Management
International, an affiliate of Goldman, Sachs & Co., serves as subadviser for
the Global Bond Portfolio; Davis Selected Advisers L.P. serves as subadviser for
the Venture Value Portfolio and Morgan Stanley Asset Management, Inc., a wholly
owned subsidiary of Morgan Stanley Group, Inc., serves as subadviser for the
International Diversified Equities and Worldwide High Income Portfolios.

The portion of the investment advisory fees received by SAAMCo which are paid
to subadvisers are as follows:
<TABLE>
<CAPTION>
MANAGEMENT
PORTFOLIO ASSETS FEES
- ---------------------------------------------------------
<S> <C> <C>
Fixed Income $0--$ 50 million 0.35%
> $ 50 million 0.25%
> $150 million 0.20%
> $250 million 0.15%
Global Bond- $0--$ 50 million 0.40%
Asset Allocation > $ 50 million 0.30%
> $150 million 0.25%
> $250 million 0.20%
Worldwide High Income- $0--$350 million 0.65%
International Diversified > $350 million 0.60%
Equities
Balanced/Phoenix $0--$ 50 million 0.35%
Investment Counsel- > $ 50 million 0.30%
Growth-Income- > $150 million 0.25%
Alliance Growth- > $300 million 0.20%
Growth/Phoenix > $500 million 0.15%
Investment Counsel

<CAPTION>
MANAGEMENT
PORTFOLIO ASSETS FEES
- ---------------------------------------------------------
<S> <C> <C>
Provident Growth $0--$ 50 million 0.50%
> $ 50 million 0.45%
> $150 million 0.35%
> $250 million 0.30%
> $350 million 0.25%
Venture Value $0--$100 million 0.45%
> $100 million 0.40%
> $500 million 0.35%
Global Equities $0--$ 50 million 0.50%
> $ 50 million 0.40%
> $150 million 0.30%
> $300 million 0.25%
</TABLE>

---------------------

79
<PAGE> 161

Effective November 1, 1994, SAAMCo has voluntarily agreed to reimburse
expenses in excess of the following percentages of average daily net assets (the
voluntary reimbursement can be retracted by SAAMCo at any time): Cash Management
Portfolio -- 0.85%, Fixed Income Portfolio -- 1.00%, Global Bond
Portfolio -- 1.35%, High-Yield Bond Portfolio -- 0.95%, Worldwide High Income
Portfolio -- 1.60%, Balanced/Phoenix Investment Counsel Portfolio -- 1.00%,
Asset Allocation Portfolio -- 0.99%, Growth-Income Portfolio -- 0.95%, Alliance
Growth Portfolio -- 0.95%, Growth/Phoenix Investment Counsel Portfolio -- 0.95%,
Provident Growth Portfolio -- 1.10%, Venture Value Portfolio -- 1.10%, Global
Equities Portfolio -- 1.50%, and International Diversified Equities
Portfolio -- 1.70%.

The impact of such expense reimbursements is reflected in the Statement of
Operations under the caption "expenses reimbursed by the investment adviser."

6. ORGANIZATIONAL EXPENSES: Costs incurred by the Adviser in connection with
the organization and registration of the Trust amounted to $204,704.
Organizational expenses are amortized on a straight line basis by each portfolio
of the Trust over the period of benefit not to exceed 60 months from the date
the respective portfolio commenced operations.

7. PURCHASES AND SALES OF SECURITIES: Information with respect to purchases and
sales of long-term securities for the year ended November 30, 1995, was as
follows:
<TABLE>
<CAPTION>
BALANCED/
PHOENIX
CASH FIXED GLOBAL HIGH-YIELD WORLDWIDE INVESTMENT ASSET
MANAGEMENT INCOME BOND BOND HIGH INCOME COUNSEL ALLOCATION
-------------------------------------------------------------------------------------------------

<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Purchases of portfolio
securities............... $ -- $95,415,175 $147,006,289 $138,372,345 $34,007,548 $42,473,080 $352,141,835
Sales of portfolio
securities.............. -- 83,064,458 139,091,866 112,918,160 22,644,456 17,985,029 289,092,283
U.S. government securities
included above were as
follows:
Purchases of U.S.
government securities... -- 84,337,477 35,433,750 2,066,875 -- 10,425,314 212,592,167
Sales of U.S. government
securities.............. -- 77,785,099 32,063,008 2,073,125 -- 2,906,986 208,376,436
</TABLE>
<TABLE>
<CAPTION>
GROWTH/PHOENIX INTERNATIONAL
GROWTH- ALLIANCE INVESTMENT PROVIDENT VENTURE GLOBAL DIVERSIFIED
INCOME GROWTH COUNSEL GROWTH VALUE EQUITIES EQUITIES
--------------------------------------------------------------------------------------------------

<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
Purchases of portfolio
securities............... $124,599,274 $200,738,953 $274,196,262 $63,822,191 $130,191,861 $150,853,413 $46,462,123
Sales of portfolio
securities.............. 67,344,207 127,900,774 252,237,605 46,951,215 10,487,423 144,012,195 13,564,536
U.S. government securities
included above were as
follows:
Purchases of U.S.
government securities... -- -- -- -- -- -- --
Sales of U.S. government
securities.............. -- -- -- -- -- -- --
</TABLE>

- ---------------------

80
<PAGE> 162

8. TRANSACTIONS WITH AFFILIATES: The following portfolio incurred brokerage
commissions with an affiliated broker:

<TABLE>
<CAPTION>
GOLDMAN
SACHS & CO.
-----------
<S> <C>
Fixed Income............................................................... $ 562
Asset Allocation........................................................... 35,946
</TABLE>

9. FINANCIAL INVESTMENTS WITH OFF-BALANCE SHEET RISK: At November 30, 1995,
Global Bond, Global Equities and International Diversified Equities Portfolios
had outstanding forward foreign currency exchange contracts ("forward
contracts") in order to hedge against changes in future foreign exchange rates
and enhance return. Forward contracts involve elements of market risk in excess
of the amount reflected in the Statement of Assets and Liabilities. The Trust
bears the risk of an unfavorable change in the foreign exchange rate underlying
the forward contract.

10. COMMITMENTS AND CONTINGENCIES: The High-Yield Bond Portfolio has
established an uncommitted line of credit with State Street Bank and Trust
Company with interest payable at Federal Funds rate plus 125 basis points.
Borrowings under the line of credit will commence when the Fund's cash shortfall
exceeds $100,000. The High-Yield Bond Portfolio periodically utilized the
uncommitted line of credit and incurred an interest expense of $2,898 for the
year ended November 30, 1995.

---------------------

81
<PAGE> 163

- ---------------------

SUNAMERICA SERIES TRUST
FINANCIAL HIGHLIGHTS*

<S> <C> <C> <C> <C> <C> <C> <C> <C>
Cash Management Portfolio
2/9/93-
11/30/93 $ 10.00 $ 0.19 $ 0.01 $ 0.20 $ -- $ -- $ 10.20 2.00%
11/30/94 10.20 0.38 (0.02) 0.36 (0.09) -- 10.47 3.51
11/30/95 10.47 0.56 0.01 0.57 (0.34) -- 10.70 5.59
Fixed Income Portfolio
7/1/93-
11/30/93 10.00 0.14 0.05 0.19 -- -- 10.19 1.90
11/30/94 10.19 0.52 (0.87) (0.35) (0.05) (0.04) 9.75 (3.41)
11/30/95 9.75 0.60 1.00 1.60 (0.53) -- 10.82 17.01
Global Bond Portfolio
7/1/93-
11/30/93 10.00 0.13 0.17 0.30 -- -- 10.30 3.00
11/30/94 10.30 0.53 (0.86) (0.33) (0.09) (0.05) 9.83 (3.18)
11/30/95 9.83 0.60 0.97 1.57 (0.38) -- 11.02 16.40
High-Yield Bond Portfolio
2/9/93-
11/30/93 10.00 0.76 0.36 1.12 -- -- 11.12 11.20
11/30/94 11.12 1.20 (1.65) (0.45) (0.29) (0.06) 10.32 (4.26)
11/30/95 10.32 1.11 0.12 1.23 (1.02) -- 10.53 12.64
Worldwide High Income Portfolio
10/28/94-
11/30/94 10.00 0.04 (0.09) (0.05) -- -- 9.95 (0.50)
11/30/95 9.95 1.10 0.47 1.57 (0.10) -- 11.42 16.02
Balanced/Phoenix Investment Counsel Portfolio
10/28/94-
11/30/94 10.00 0.04 (0.08) (0.04) -- -- 9.96 (0.40)
11/30/95 9.96 0.34 2.23 2.57 (0.05) -- 12.48 25.89
Asset Allocation Portfolio
7/1/93-
11/30/93 10.00 0.08 0.28 0.36 -- -- 10.36 3.60
11/30/94 10.36 0.29 (0.25) 0.04 (0.05) (0.03) 10.32 0.30
11/30/95 10.32 0.42 2.24 2.66 (0.20) (0.04) 12.74 26.10
</TABLE>

RATIO OF
NET NET
ASSETS RATIO OF INVESTMENT
END OF EXPENSES INCOME
PERIOD PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED (000'S) NET ASSETS NET ASSETS TURNOVER
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cash Mana
2/9/93-
11/30/93 $ 24,603 0.71%+++ 2.53%+++ --%
11/30/94 89,098 0.70++ 3.73++ --
11/30/95 90,731 0.67 5.32 --
Fixed Inc
7/1/93-
11/30/93 11,667 0.94+++ 3.92+++ 208
11/30/94 15,869 0.94++ 5.21++ 419
11/30/95 29,475 0.96++ 5.93++ 412
Global Bo
7/1/93-
11/30/93 25,010 1.35+++ 3.56+++ 84
11/30/94 44,543 1.06 5.29 347
11/30/95 59,759 0.95 5.89 339
High-Yiel
2/9/93-
11/30/93 41,851 0.94+++ 9.43+++ 229
11/30/94 55,803 0.92++ 11.07++ 225
11/30/95 82,174 0.80 10.80 174
Worldwide
10/28/94-
11/30/94 10,478 1.60+++ 4.48+++ 2
11/30/95 21,515 1.30 10.46 176
Balanced/
10/28/94-
11/30/94 1,516 1.00+++ 4.25+++ 10
11/30/95 32,429 0.98++ 3.08++ 153
Asset All
7/1/93-
11/30/93 35,590 0.99+++ 2.33+++ 71
11/30/94 106,856 0.94++ 2.71++ 152
11/30/95 199,836 0.81 3.62 207
</TABLE>

* Calculated based upon average shares outstanding
** After fee waivers and expense reimbursements by the investment adviser
+ Annualized
++ During the periods ended November 30, 1993, November 30, 1994 and
November 30, 1995, the investment adviser waived a portion of or all
fees and assumed a portion of or all expenses for the portfolios. If all
fees and expenses had been incurred by the portfolios, the ratio of
expenses to average net assets and the ratio of net investment income to
average net assets would have been as follows:

<TABLE>
<CAPTION>
EXPENSES NET INVESTMENT INCOME (LOSS)
---------------------------------- ----------------------------------
11/30/93 11/30/94 11/30/95 11/30/93 11/30/94 11/30/95
---------------------------------- ----------------------------------
<S> <C> <C> <C> <C> <C> <C>
Cash Management Portfolio........................... 1.10% 0.78% 0.67% 2.14% 3.65% 5.32%
Fixed Income Portfolio.............................. 1.81 1.09 0.97 3.05 5.06 5.92
Global Bond Portfolio............................... 1.81 1.06 0.95 3.10 5.29 5.89
High-Yield Bond Portfolio........................... 1.29 0.93 0.80 9.08 11.06 10.80
Worldwide High Income Portfolio..................... -- 2.26 1.30 -- 3.82 10.46
Balanced/Phoenix Investment Counsel Portfolio....... -- 6.82 1.11 -- (1.57) 2.95
Asset Allocation Portfolio.......................... 1.67 0.94 0.81 1.65 2.71 3.62
</TABLE>

See Notes to Financial Statements

- ---------------------
82
<PAGE> 164

- ---------------------

SUNAMERICA SERIES TRUST
FINANCIAL HIGHLIGHTS* -- (CONTINUED)

SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
PERIOD
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NET
NET REALIZED DIVIDENDS DIVIDENDS
ASSET NET & TOTAL DECLARED FROM NET
VALUE INVEST- UNREALIZED FROM FROM NET REALIZED NET ASSET
BEGINNING MENT GAIN (LOSS) INVEST- INVEST- GAIN ON VALUE
PERIOD OF INCOME ON MENT MENT INVEST- END OF TOTAL
ENDED PERIOD (LOSS)** INVESTMENTS OPERATIONS INCOME MENTS PERIOD RETURN
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Growth-Income Portfolio
2/9/93-
11/30/93 $ 10.00 $ 0.12 $ 0.49 $ 0.61 $ -- $ -- $ 10.61 6.10%
11/30/94 10.61 0.13 (0.36) (0.23) (0.04) (0.01) 10.33 (2.20)
11/30/95 10.33 0.17 3.31 3.48 (0.10) -- 13.71 33.89
Alliance Growth Portfolio
2/9/93-
11/30/93 10.00 0.05 0.87 0.92 -- -- 10.92 9.20
11/30/94 10.92 0.04 (0.14) (0.10) (0.01) (0.17) 10.64 (0.93)
11/30/95 10.64 0.07 5.08 5.15 (0.03) (0.13) 15.63 48.91
Growth/Phoenix Investment Counsel Portfolio
2/9/93-
11/30/93 10.00 0.17 0.61 0.78 -- -- 10.78 7.80
11/30/94 10.78 0.16 (0.87) (0.71) (0.06) -- 10.01 (6.64)
11/30/95 10.01 0.12 3.14 3.26 (0.13) -- 13.14 32.92
Provident Growth Portfolio
2/9/93-
11/30/93 10.00 0.02 0.02 0.04 -- -- 10.04 0.40
11/30/94 10.04 0.03 (0.01) 0.02 (0.01) -- 10.05 0.19
11/30/95 10.05 (0.01) 3.09 3.08 (0.03) -- 13.10 30.66
Venture Value Portfolio
10/28/94-
11/30/94 10.00 0.03 (0.25) (0.22) -- -- 9.78 (2.20)
11/30/95 9.78 0.17 3.55 3.72 (0.03) -- 13.47 38.17
Global Equities Portfolio
2/9/93-
11/30/93 10.00 0.03 0.96 0.99 -- -- 10.99 9.90
11/30/94 10.99 0.05 0.71 0.76 (0.01) (0.07) 11.67 6.87
11/30/95 11.67 0.12 1.64 1.76 (0.08) (0.29) 13.06 15.58
International Diversified Equities Portfolio
10/28/94-
11/30/94 10.00 0.01 (0.23) (0.22) -- -- 9.78 (2.20)
11/30/95 9.78 0.07 0.38 0.45 (0.08) -- 10.15 4.63

</TABLE>

RATIO OF
NET NET
ASSETS RATIO OF INVESTMENT
END OF EXPENSES INCOME
PERIOD PERIOD TO AVERAGE TO AVERAGE PORTFOLIO
ENDED (000'S) NET ASSETS NET ASSETS TURNOVER
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Growth-In
2/9/93-
11/30/93 $ 45,080 0.82%+++ 1.59%+++ 27%
11/30/94 84,899 0.81++ 1.26++ 59
11/30/95 171,281 0.77 1.42 59
Alliance
2/9/93-
11/30/93 23,256 0.82+++ 0.61+++ 73
11/30/94 53,213 0.82++ 0.37++ 146
11/30/95 167,870 0.79 0.51 138
Growth/Ph
2/9/93-
11/30/93 65,032 0.82+++ 2.20+++ 165
11/30/94 104,194 0.81++ 1.52++ 211
11/30/95 149,910 0.76 1.01 229
Provident
2/9/93-
11/30/93 42,911 0.97+++ 0.32+++ 40
11/30/94 75,342 0.96++ 0.31++ 54
11/30/95 115,276 0.93 (0.05) 52
Venture V
10/28/94-
11/30/94 4,449 1.10+++ 3.93+++ --
11/30/95 154,908 1.00++ 1.43++ 18
Global Eq
2/9/93-
11/30/93 43,737 1.50+++ 0.38+++ 58
11/30/94 136,758 1.28 0.42 67
11/30/95 165,752 1.14 1.02 106
Internati
10/28/94-
11/30/94 12,438 1.70+++ 1.60+++ --
11/30/95 48,961 1.70++ 0.76++ 52
</TABLE>

* Calculated based upon average shares outstanding

** After fee waivers and expense reimbursements by the investment adviser

+ Annualized

++ During the periods ended November 30, 1993, November 30, 1994 and
November 30, 1995, the investment adviser waived a portion of or all
fees and assumed a portion of or all expenses for the portfolios. If all
fees and expenses had been incurred by the portfolios, the ratio of
expenses to average net assets and the ratio of net investment income to
average net assets would have been as follows:

<TABLE>
<CAPTION>
EXPENSES NET INVESTMENT INCOME (LOSS)
---------------------------------- ----------------------------------
11/30/93 11/30/94 11/30/95 11/30/93 11/30/94 11/30/95
---------------------------------- ----------------------------------
<S> <C> <C> <C> <C> <C> <C>
Growth-Income Portfolio............................. 1.40% 0.89% 0.77% 1.01% 1.18% 1.42%
Alliance Growth Portfolio........................... 1.56 0.96 0.79 (0.13) 0.23 0.51
Growth/Phoenix Investment Counsel Portfolio......... 1.28 0.87 0.76 1.74 1.46 1.01
Provident Growth Portfolio.......................... 1.46 1.05 0.93 (0.17) 0.22 (0.05)
Venture Value Portfolio............................. -- 3.89 1.02 -- 1.14 1.41
Global Equities Portfolio........................... 2.52 1.28 1.14 (0.64) 0.42 1.02
International Diversified Equities Portfolio........ -- 3.50 2.09 -- (0.20) 0.37
</TABLE>

See Notes to Financial Statements

---------------------

83
<PAGE> 165

- ---------------------

SUNAMERICA SERIES TRUST
REPORT OF INDEPENDENT ACCOUNTANTS

To the Trustees and Shareholders of SunAmerica Series Trust

In our opinion, the accompanying statement of assets and liabilities, including
the investment portfolios, 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 the Cash Management Portfolio,
Fixed Income Portfolio, Global Bond Portfolio, High-Yield Bond Portfolio,
Worldwide High Income Portfolio, Balanced/Phoenix Investment Counsel Portfolio,
Asset Allocation Portfolio, Growth-Income Portfolio, Alliance Growth Portfolio,
Growth/Phoenix Investment Counsel Portfolio, Provident Growth Portfolio, Venture
Value Portfolio, Global Equities Portfolio and International Diversified
Equities Portfolio (constituting SunAmerica Series Trust, hereafter referred to
as the "Fund") at November 30, 1995, the results of each of their operations for
the year then ended, the changes in each of their net assets for each of the two
years in the period then ended and the financial highlights for each of 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 Fund'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 securities at
November 30, 1995 by correspondence with the custodian and brokers and the
application of alternative auditing procedures where confirmations from brokers
were not received, provide a reasonable basis for the opinion expressed above.

PRICE WATERHOUSE LLP

1177 Avenue of the Americas
New York, New York
January 16, 1996

- ---------------------

84
<PAGE> 166
PART C
OTHER INFORMATION

Item 24. Financial Statements and Exhibits.

(a) Financial Statements.

Set forth in Part B of Registrant's Statement of Additional
Information are the audited financial statements of the
SunAmerica Series Trust with respect to Registrant's fiscal
year ended November 30, 1995. Selected per share data and
ratios are set forth in Part A of the Prospectus under the
caption "Financial Highlights." No financial statements are
included in Part C.

All other financial statements, schedules and historical
financial information are omitted because the conditions
requiring their filing do not exist.

(b) Exhibits.

(1) Declaration of Trust, as Amended . . . . . . . . . . . . . . . . . *
(2) By-Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . *
(3) Voting Trust Agreement . . . . . . . . . . . . . . . . Not Applicable
(4) Share of Beneficial Interest . . . . . . . . . . . . . Not Applicable
(5) (a) Investment Advisory and Management Agreement . . . . . . . . . *
(b) Subadvisory Agreements . . . . . . . . . . . . . . . . . . . . *
(6) Distribution Agreement . . . . . . . . . . . . . . . . Not Applicable
(7) Bonus, Profit Sharing, Pension or Similar Contracts . . Not Applicable
(8) Custodian Agreement . . . . . . . . . . . . . . . . . . . . . . . . *
(9) Fund Participation Agreement . . . . . . . . . . . . . . . . . . . *
(10) Opinion and Consent of Counsel . . . . . . . . . . . . . . . . . . *
(11) Consent of Independent Accountants . . . . . . . . . . . . . Herewith
(12) Financial Statements Omitted from Item 23 . . . . . . . Not Applicable
(13) Initial Capitalization Agreement . . . . . . . . . . . Not Applicable
(14) Model Plan . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(15) Rule 12b-1 Plan . . . . . . . . . . . . . . . . . . . . Not Applicable
(16) Persons under Common Control with Registrant . . . . . . . . . . . *
(17) Performance Computations . . . . . . . . . . . . . . . Not Applicable
(18) Power of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . *

* Previously filed.
<PAGE> 167
Item 25. Persons Controlled by or Under Common Control with Registrant.

Previously Filed.

Item 26. Number of Holders of Securities.

As of March 15, 1996, the number of record holders of SunAmerica
Series Trust was as follows:

Title of Class Number of Record Holders
-------------- ------------------------
[S] [C]
Shares of Beneficial Interest 3*

* Held by Variable Separate Account of Anchor National Life Insurance
Company, FS Variable Separate Account of First SunAmerica Life
Insurance Company and SunAmerica, Inc.

Item 27. Indemnification.

Article VI of the Registrant's By-Laws relating to the indemnification
of officers and trustees is quoted below:

ARTICLE VI
INDEMNIFICATION

The Trust shall provide any indemnification required by
applicable law and shall indemnify trustees, officers, agents and
employees as follows:

(a) the Trust shall indemnify any director or officer of the Trust who
was or is a party or is threatened to be made a party of any
threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than action by
or in the right of the Trust) by reason of the fact that such Person
is or was such Trustee or officer or an employee or agent of the
Trust, or is or was serving at the request of the Trust as a director,
officer, employee or agent of another corporation, partnership, joint
venture, Trust or other enterprise, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such Person in connection with
such action, suit or proceeding, provided such Person acted in good
faith an in a manner such Person reasonably believed to be in or not
opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such
Person's conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction or upon a plea
of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the Person did not reasonably believe his or her
actions to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had reasonable
cause to believe that such Person's conduct was unlawful.

(b) The Trust shall indemnify any Trustee or officer of the Trust who
was or is a part or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of
the Trust to procure a judgment in its favor by reason of the fact
that such Person is or C-2 was such Trustee or officer or an employee
or agent of the Trust, or is or was serving at the
<PAGE> 168
request of the Trust as a director, officer, employee or agent of
another corporation, partnership, joint venture, Trust or other
enterprise, against expenses (including attorneys' fees), actually and
reasonably incurred by such Person in connection with the defense or
settlement of such action or suit if such Person acted in good faith
and in a manner such Person reasonably believed to be in or not
opposed to the best interests of the Trust, except that no
indemnification shall be made in respect of any claim, issue or matter
as to which such Person shall have been adjudged to be liable for
negligence or misconduct in the performance of such Person's duty to
the Trust unless and only to the extent that the court in which such
action or suit was brought, or any other court having jurisdiction in
the premises, shall determine upon application that, despite the
adjudication of liability but in view of all circumstances of the
case, such Person is fairly and reasonably entitled to indemnity for
such expenses which such court shall deem proper.

(c) To the extent that a Trustee or officer of the Trust has been
successful on the merits or otherwise in defense of any action, suit
or proceeding referred to in subparagraphs (a) or (b) above or in
defense of any claim, issue or matter therein, such Person shall be
indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such Person in connection therewith, without
the necessity for the determination as to the standard of conduct as
provided in subparagraph (d).

(d) Any indemnification under subparagraph (a) or (b) (unless ordered
by a court) shall be made by the Trust only as authorized in the
specific case upon a determination that indemnification of the Trustee
or officer is proper in view of the standard of conduct set forth in
subparagraph (a) or (b). Such determination shall be made (i) by the
Board by a majority vote of a quorum consisting of Trustees who were
disinterested and not parties to such action, suit or proceedings, or
(ii) if such a quorum of disinterested Trustees so directs, by
independent legal counsel in a written opinion, and any determination
so made shall be conclusive and binding upon all parties.

(e) Expenses incurred in defending a civil or criminal action, writ
or proceeding may be paid by the Trust in advance of the final
disposition of such action, suit or proceeding, as authorized in the
particular case, upon receipt of an undertaking by or on behalf of the
Trustee or officer to repay such amount unless it shall ultimately be
determined that such Person is entitled to be indemnified by the Trust
as authorized herein. Such determination must be made by
disinterested Trustees or independent legal counsel.

Prior to any payment being made pursuant to this paragraph, a majority
of quorum of disinterested, non-party Trustees of the Trust, or an
independent legal counsel in a written opinion, shall determine, based
on a review of readily available facts that there is reason to believe
that the indemnitee ultimately will be found entitled to
indemnification.

(f) Agents and employees of the Trust who are not Trustees or
officers of the Trust may be indemnified under the same standards and
procedures set forth above, in the discretion of the Board.

(g) Any indemnification pursuant to this Article shall not be deemed
exclusive of any other rights to which those indemnified may be
entitled and shall continue as to a Person who has

C-3
<PAGE> 169
ceased to be a Trustee or officer and shall inure to the benefit of
the heirs, executors and administrators of such a Person.

(h) Nothing in the Declaration or in these By-Laws shall be deemed to
protect any Trustee or officer of the Trust against any liability to
the Trust or to its Shareholders to which such Person would otherwise
be subject by reason of willful malfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct
of such Person's office.

(i) The Trust shall have power to purchase and maintain insurance on
behalf of any Person against any liability asserted against or
incurred by such Person, whether or not the Trust would have the power
to indemnify such Person against such liability under the provisions
of this Article. Nevertheless, insurance will not be purchased or
maintained by the Trust if the purchase or maintenance of such
insurance would result in the indemnification of any Person in
contravention of any rule or regulation and/or interpretation of the
Securities and Exchange Commission.

* * * * * * * * * * * * * *

The Investment Advisory and Management Agreement provides that
in absence of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of office on
the part of the Investment Adviser (and its officers, directors,
agents, employees, controlling persons, shareholders and any other
person or entity affiliated with the Investment Adviser to perform or
assist in the performance of its obligations under each Agreement) the
Investment Adviser shall not be subject to liability to the Trust or
to any shareholder of the Trust for any act or omission in the course
of, or connected with, rendering services, including without
limitation, any error of judgment or mistake or law or for any loss
suffered by any of them in connection with the matters to which each
Agreement relates, except to the extent specified in Section 36(b) of
the Investment Company Act of 1940 concerning loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation
for services. Certain of the Subadvisory Agreements provide for
similar indemnification of the Subadviser by the Investment Adviser.

SunAmerica Inc., the parent of Anchor National Life Insurance
Company, provides, without cost to the Fund, indemnification of
individual trustees. By individual letter agreement, SunAmerica Inc.
indemnifies each trustee to the fullest extent permitted by law
against expenses and liabilities (including damages, judgments,
settlements, costs, attorney's fees, charges and expenses) actually
and reasonably incurred in connection with any action which is the
subject of any threatened, asserted, pending or completed action, suit
or proceeding, whether civil, criminal, administrative, investigative
or otherwise and whether formal or informal to which any trustee was,
is or is threatened to be made a party by reason of facts which
include his being or having been a trustee, but only to the extent
such expenses and liabilities are not covered by insurance.

Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to trustees,
officers and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been advised
that in the

C-4
<PAGE> 170
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is therefore
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a trustee, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person
in connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by
the final adjudication of such issue.

Item 28. Business and other Connections of Investment Adviser.

SunAmerica Asset Management Corp. ("SAAMCo"), the Investment Adviser
of the Trust, is primarily in the business of providing investment
management, advisory and administrative services. Reference is made
to the most recent Form ADV and schedules thereto of SAAMCo on file
with the Commission (File No. 801-19813) for a description of the
names and employment of the directors and officers of SAAMCo and other
required information. Alliance Capital Management L.P., Goldman Sachs
Asset Management, Goldman Sachs Asset Management International,
Phoenix Investment Counsel, Inc., Provident Investment Counsel, Inc.,
Davis Selected Advisers, L.P., Morgan Stanley Asset Management Inc.
and Federated Investment Counseling, the Subadvisers of certain of the
Portfolios of the Trust, are primarily engaged in the business of
rendering investment advisory services. Reference is made to the most
recent Form ADV and schedules thereto on file with the Commission for
a description of the names and employment of the directors and
officers of Alliance Capital Management L.P., Goldman Sachs Asset
Management, Goldman Sachs Asset Management International, Phoenix
Investment Counsel, Inc., Provident Investment Counsel, Inc., Davis
Selected Advisers, L.P. Morgan Stanley Asset Management Inc. and
Federated Investment Counseling, and other required information:

File No.
----------
<S> <C>
Alliance Capital Management L.P. 801-32361
Goldman Sachs Asset Management 801-16048
Goldman Sachs Asset Management Intl 801-38157
Phoenix Investment Counsel, Inc. 801-5995
Provident Investment Counsel, Inc. 801-11303
Davis Selected Advisers, L.P. 801-31648
Morgan Stanley Asset Management Inc. 801-15757
Federated Investment Counseling 801-34611
</TABLE>

Item 29. Principal Underwriters.

There is no Principal Underwriter for the Registrant.

Item 30. Location of Accounts and Records.

C-5
<PAGE> 171
State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02110, acts as custodian, transfer agent and dividend
paying agent. It maintains books, records and accounts pursuant to
the instructions of the Trust.

SunAmerica Asset Management Corp., is located at The SunAmerica
Center, 733 Third Avenue, New York, New York 10017-3204. Alliance
Capital Management L.P. is located at 1345 Avenue of the Americas, New
York, New York 10105. Goldman Sachs Asset Management and Goldman
Sachs Asset Management International are located at 85 Broad Street,
12th Floor, New York, New York 10005. Morgan Stanley Asset Management
Inc., is located at 1221 Avenue of the Americas, 22nd Floor, New York,
New York 10020. Phoenix Investment Counsel, Inc. is located at One
American Row, Hartford, Connecticut 06115. Provident Investment
Counsel, Inc. is located at 300 No. Lake Avenue, Penthouse Suite,
Pasadena, California 91101-4922. Davis Selected Advisers, L.P. is
located at 124 East Marcy Street, Sante Fe, New Mexico 87501.
Federated Investment Counseling is located at Federated Investors
Tower, 1001 Liberty Avenue, Pittsburgh, Pennsylvania 15222-3779. Each
of the Investment Adviser and Subadvisers maintain the books, accounts
and records required to be maintained pursuant to Section 31(a) of the
Investment Company Act of 1940 and the rules promulgated thereunder.

Item 31. Management Services.

None.

Item 32. Undertakings.

Registrant hereby undertakes to:

(a) Inapplicable;

(b) with respect to the Aggressive Growth Portfolio, SunAmerica
Balanced Portfolio, Federated Value Portfolio and Utility Portfolio,
series of the Trust, file a post-effective amendment, using financial
statements which need not be certified, within four to six months from
the effective date of the post-effective amendment to registrants'
registration statement in which shares of such series were registered;
and

(c) furnish an investor to whom a prospectus is delivered with a copy
of Registrant's latest annual report to shareholders, upon request and
without charge.

C-6
<PAGE> 172
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, Registrant has duly caused the Post-Effective
Amendment No. 7 to the Registration Statement on Form N-1A to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York,
and State of New York, on the 15th day of March, 1996.

SUNAMERICA SERIES TRUST

By: /s/ Peter C. Sutton
Peter C. Sutton
Vice President

Pursuant to the requirements of the Securities Act of 1933, as
amended, the Post-Effective Amendment No. 7 to Registrant's Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated:

<TABLE>
<S> <C> <C>
JAMES K. HUNT * Trustee, Chairman and President March 14, 1996
- ------------------------------- (Principal Executive Officer)
James K. Hunt

SCOTT L. ROBINSON * Senior Vice President, Treasurer March 14, 1996
- ------------------------------- and Controller (Principal Financial
Scott L. Robinson and Accounting Officer)

RICHARDS D. BARGER * Trustee March 14, 1996
- -------------------------------
Richards D. Barger

FRANK L. ELLSWORTH * Trustee March 14, 1996
- -------------------------------
Frank L. Ellsworth

GORDON F. HAMPTON * Trustee March 14, 1996
- -------------------------------
Gordon F. Hampton

NORMAN J. METCALFE * Trustee March 14, 1996
- -------------------------------
Norman J. Metcalfe
</TABLE>

*By: /s/ Robert M. Zakem
Robert M. Zakem
Attorney-in-Fact

<PAGE> 173

EXHIBIT INDEX
-------------

EXHIBIT NO. DESCRIPTION
----------- -----------

Ex.-99.11 Consent of Independent Accountants

<PAGE> 1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the use in the Statement of Additional Information
constituting part of this Post-Effective Amendment No. 7 to the registration
statement on Form N-1A (the "Registration Statement") of our report dated
January 16, 1996, relating to the financial statements and financial
highlights of SunAmerica Series Trust, which appears in such Statement of
Additional Information. We also consent to the reference to us under the
heading "General Information - Independent Accountants" in such Statement of
Additional Information and to the references to us under the headings "Financial
Highlights" and "Independent Accountants" in such Prospectus.

PRICE WATERHOUSE LLP

1177 Avenue of the Americas
New York, New York
March 12, 1996