<PAGE> 1
SUNAMERICA SERIES TRUST
Supplement to the Prospectus dated April 20, 2000
The date of the Prospectus is hereby changed to December 29, 2000.
This supplement should be read in conjunction with the Trust's Prospectus dated
April 20, 2000. Capitalized terms used herein have the same meaning as in the
Prospectus.
Dated: December 29, 2000
<PAGE> 2
PERFORMANCE INFORMATION
The following supplements the information accompanying the Risk/Return Bar
Charts under the "TRUST HIGHLIGHTS" section of the Prospectus.
The following is the year-to-date return information as of the most recent
calendar quarter ended September 30, 2000:
<TABLE>
<CAPTION>
PORTFOLIO RETURN
--------- ------
<S> <C>
Cash Management Portfolio................................... 4.41%
SunAmerica Balanced Portfolio............................... 0.41%
Equity Index Portfolio...................................... -1.84%
Davis Venture Value Portfolio............................... 8.29%
Alliance Growth Portfolio................................... -3.70%
Aggressive Growth Portfolio................................. 10.66%
International Growth and Income Portfolio................... 3.71%
</TABLE>
INFORMATION ABOUT THE SUBADVISERS
The following supplements the information under the "MANAGEMENT -- INFORMATION
ABOUT THE SUBADVISERS" section of the Prospectus:
BANC OF AMERICA CAPITAL MANAGEMENT, INC. (BACAP) is located at One Bank of
America Plaza, Charlotte, NC 28255. BACAP and its affiliates, dedicated to
providing responsible investment management and superior management and superior
service, manage money for foundations, universities, corporation, institutions
and individuals. SAAMCo has hired BCAP to serve as subadviser for the CASH
MANAGEMENT PORTFOLIO effective December 29, 2000.
PORTFOLIO MANAGEMENT
The following replaces the information under the "MANAGEMENT -- PORTFOLIO
MANAGEMENT" section of the Prospectus with respect to the CASH MANAGEMENT
PORTFOLIO.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
PORTFOLIO NAME AND TITLE OF EXPERIENCE
ADVISER/ PORTFOLIO MANAGER (AND/
SUBADVISER OR MANAGEMENT TEAM)
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Management BACAP - Taxable Money Market N/A
Management Team
-----------------------------------------------------------------------------------------------------------------
</TABLE>
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
The following supplements the information under the "FINANCIAL HIGHLIGHTS"
section of the Prospectus:
2
<PAGE> 3
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
The following Financial Highlights tables for each Portfolio are intended to
help you understand the Portfolios' financial performance for the past 5 years.
Certain information reflects financial results for a single Portfolio share. The
total returns in each table represent the rate that an investor would have
earned on an investment in the Portfolio (assuming reinvestment of all dividends
and distributions). This information, except for the six month period ended July
31, 2000, has been audited by PricewaterhouseCoopers LLP, whose report, along
with each Portfolio's financial statements, are included in the Trust's annual
report to shareholders, which is available upon request.
<TABLE>
<CAPTION>
NET NET TOTAL
ASSET INVEST- NET REALIZED & FROM
VALUE MENT UNREALIZED GAIN INVEST-
PERIOD BEGINNING INCOME (LOSS) ON MENT
ENDED OF PERIOD (LOSS)** INVESTMENTS OPERATIONS
---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cash Management Portfolio
11/30/95 $10.47 $0.56 $ 0.01 $0.57
11/30/96 10.70 0.53 (0.02) 0.51
11/30/97 10.76 0.53 0.01 0.54
11/30/98 10.74 0.54 (0.02) 0.52
1/31/99# 10.58 0.08 0.01 0.09
1/31/00 10.67 0.51 -- 0.51
7/31/00+ 10.94 0.31 0.01 0.32
SunAmerica Balanced Portfolio
6/3/96-
11/30/96 10.00 0.10 1.03 1.13
11/30/97 11.13 0.23 2.15 2.38
11/30/98 13.45 0.30 2.33 2.63
1/31/99# 15.61 0.05 1.58 1.63
1/31/00 17.24 0.36 1.80 2.16
7/31/00+ 19.06 0.18 0.26 0.44
Equity Index Portfolio
12/14/98-
1/31/99 10.00 0.01 1.17 1.18
1/31/00 11.15 0.12 0.67 0.79
7/31/00+ 11.88 0.04 0.30 0.34
Davis Venture Value Portfolio
11/30/95 9.78 0.17 3.55 3.72
11/30/96 13.47 0.18 3.46 3.64
11/30/97 16.90 0.19 4.73 4.92
11/30/98 21.47 0.20 2.23 2.43
1/31/99# 23.10 0.03 1.25 1.28
1/31/00 24.38 0.13 3.06 3.19
7/31/00+ 26.44 0.05 1.91 1.96
<CAPTION>
DIVIDENDS NET NET
DIVIDENDS FROM NET ASSET ASSETS
DECLARED FROM REALIZED VALUE END OF
PERIOD NET INVESTMENT GAIN ON END OF TOTAL PERIOD
ENDED INCOME INVESTMENTS PERIOD RETURN*** (000'S)
-------------------------------------------------- --------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Cash Management Portfolio
11/30/95 $ (0.34) $ -- $10.70 5.59% $ 90,731
11/30/96 (0.45) -- 10.76 4.92 91,247
11/30/97 (0.56) -- 10.74 5.22 156,119
11/30/98 (0.68) -- 10.58 5.05 223,640
1/31/99# -- -- 10.67 0.85 277,370
1/31/00 (0.24) -- 10.94 4.85 466,588
7/31/00+ -- -- 11.26 2.93 481,159
SunAmerica Balanced Portfolio
6/3/96-
11/30/96 -- -- 11.13 11.30 10,224
11/30/97 (0.04) (0.02) 13.45 21.48 44,621
11/30/98 (0.11) (0.36) 15.61 19.81 149,242
1/31/99# -- -- 17.24 10.44 194,878
1/31/00 (0.12) (0.22) 19.06 12.76 509,054
7/31/00+ -- -- 19.50 2.31 586,483
Equity Index Portfolio
12/14/98-
1/31/99 (0.03) -- 11.15 11.81 11,168
1/31/00 (0.06) -- 11.88 7.05 63,487
7/31/00+ -- -- 12.22 2.86 67,612
Davis Venture Value Portfolio
11/30/95 (0.03) -- 13.47 38.17 154,908
11/30/96 (0.09) (0.12) 16.90 27.44 516,413
11/30/97 (0.09) (0.26) 21.47 29.62 1,140,053
11/30/98 (0.12) (0.68) 23.10 11.36 1,725,411
1/31/99# -- -- 24.38 5.54 1,840,354
1/31/00 (0.20) (0.93) 26.44 13.42 2,303,994
7/31/00+ -- -- 28.40 7.41 2,557,943
<CAPTION>
RATIO OF NET
RATIO OF INVESTMENT
EXPENSES TO INCOME TO
PERIOD AVERAGE NET AVERAGE NET PORTFOLIO
ENDED ASSETS ASSETS TURNOVER
-------------------------------------------------- ------------------------------------------
<S> <C> <C> <C>
Cash Management Portfolio
11/30/95 0.67% 5.32% --%
11/30/96 0.62 4.90 --
11/30/97 0.63 5.06 --
11/30/98 0.58 4.97 --
1/31/99# 0.62+ 5.02+ --
1/31/00 0.53 4.82 --
7/31/00+ 0.53+ 5.71+ --
SunAmerica Balanced Portfolio
6/3/96-
11/30/96 1.00+++ 1.92+++ 40
11/30/97 1.00 1.82 143
11/30/98 0.78 2.10 111
1/31/99# 0.74+@ 1.73+@ 26
1/31/00 0.66 2.01 197
7/31/00+ 0.64+ 1.89+ 131
Equity Index Portfolio
12/14/98-
1/31/99 0.55+++ 0.75+++ --
1/31/00 0.55++ 1.02++ 1
7/31/00+ 0.55+ 0.66+ 1
Davis Venture Value Portfolio
11/30/95 1.00++ 1.43++ 18
11/30/96 0.85 1.21 22
11/30/97 0.79 0.98 22
11/30/98 0.75 0.89 25
1/31/99# 0.77+ 0.86+ 5
1/31/00 0.74 0.51 23
7/31/00+ 0.75+ 0.39+ 19
</TABLE>
---------------
* Calculated based upon average shares outstanding
** After fee waivers and expense reimbursements by the investment adviser
*** Does not reflect expenses that apply to the separate accounts of the
insurance companies. If such expenses had been included, total return
would have been lower for each period presented.
# The Portfolio changed its fiscal year ended from November 30 to January
31.
+ Annualized
@ Net of custody credits of 0.01%, 0.01%, 0.02%, and 0.01% for the periods
ending November 30, 1998, January 31, 1999, January 31, 2000, and July
31, 2000 respectively.
+ Unaudited
++ During the below stated periods, 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>
<CAPTION>
EXPENSES
--------------------------------------------------------
11/95 11/96 11/97 11/98 1/99+ 1/00 7/00+
--------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Cash Management.............. 0.67% 0.62% 0.63% 0.58% 0.62% 0.53% 0.53%
SunAmerica Balanced.......... -- 1.43 1.00 0.78 0.74 0.66 0.64
Equity Index ................ -- -- -- -- 1.80 0.85 0.55
Davis Venture Value.......... 1.02 0.85 0.79 0.75 0.77 0.74 0.75
<CAPTION>
NET INVESTMENT INCOME (LOSS)
--------------------------------------------------------
11/95 11/96 11/97 11/98 1/99+ 1/00 7/00+
--------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Cash Management.............. 5.32% 4.90% 5.06% 4.97% 5.02% 4.82% 5.71%
SunAmerica Balanced.......... -- 1.49 1.82 2.10 1.73 2.01 1.89
Equity Index ................ -- -- -- -- 0.50 0.72 0.66
Davis Venture Value.......... 1.41 1.21 0.98 0.89 0.86 0.51 0.39
</TABLE>
3
<PAGE> 4
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NET NET TOTAL DIVIDENDS DIVIDENDS
ASSET INVEST- NET REALIZED FROM DECLARED FROM FROM NET
VALUE MENT & UNREALIZED INVEST- NET REALIZED
PERIOD BEGINNING INCOME GAIN (LOSS) ON MENT INVESTMENT GAIN ON
ENDED OF PERIOD (LOSS)** INVESTMENTS OPERATIONS INCOME INVESTMENTS
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Alliance Growth Portfolio
11/30/95 $10.64 $ 0.07 $5.08 $5.15 $ (0.03) $(0.13)
11/30/96 15.63 0.08 4.07 4.15 (0.04) (1.01)
11/30/97 18.73 0.16 4.76 4.92 (0.05) (1.04)
11/30/98 22.56 0.07 7.77 7.84 (0.06) (2.30)
1/31/99# 28.04 0.00 7.22 7.22 -- --
1/31/00 35.26 (0.04) 4.46 4.42 (0.05) (3.05)
7/31/00+ 36.58 (0.03) 2.45 2.42 -- --
Aggressive Growth Portfolio
6/3/96-
11/30/96 10.00 0.02 0.34 0.36 -- --
11/30/97 10.36 0.01 1.40 1.41 (0.01) --
11/30/98 11.76 0.04 0.52 0.56 -- --
1/31/99# 12.32 -- 3.20 3.20 -- --
1/31/00 15.52 -- 8.59 8.59 (0.03) (1.36)
7/31/00+ 22.72 0.01 0.68 0.69 -- --
International Growth and Income Portfolio
6/2/97-
11/30/97 10.00 0.03 0.38 0.41 -- --
11/30/98 10.41 0.13 0.86 0.99 (0.03) (0.06)
1/31/99# 11.31 -- 0.40 0.40 (0.02) (0.19)
1/31/00 11.50 0.15 1.97 2.12 (0.45) (0.89)
7/31/00+ 12.28 0.10 0.68 0.78 -- --
<CAPTION>
NET NET RATIO OF NET
ASSET ASSETS RATIO OF INVESTMENT
VALUE END OF EXPENSES TO INCOME TO
PERIOD END OF TOTAL PERIOD AVERAGE NET AVERAGE PORTFOLIO
ENDED PERIOD RETURN*** (000'S) ASSETS NET ASSETS TURNOVER
------------------------------------------- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Alliance Growth Portfolio
11/30/95 $15.63 48.91% $ 167,870 0.79% 0.51% 138%
11/30/96 18.73 28.05 381,367 0.71 0.51 121
11/30/97 22.56 27.80 704,533 0.65 0.37 110
11/30/98 28.04 35.92 1,396,140 0.58 0.27 90
1/31/99# 35.26 25.75 1,864,924 0.63+ (0.01)+ 11
1/31/00 36.58 14.09 2,875,413 0.63 (0.11) 77
7/31/00+ 39.00 6.62 3,181,338 0.64+ (0.14)+ 42
Aggressive Growth Portfolio
6/3/96-
11/30/96 10.36 3.60 35,124 1.05+++ 0.46+++ 47
11/30/97 11.76 13.62 103,603 0.90 (0.13) 221
11/30/98 12.32 4.76 133,183 0.83 0.32 268
1/31/99# 15.52 25.97 182,313 0.82+ 0.13+ 29
1/31/00 22.72 60.62 450,073 0.75 0.02 131
7/31/00+ 23.41 3.04 610,031 0.69+@ 0.10+@ 135
International Growth and Income Portfolio
6/2/97-
11/30/97 10.41 4.10 42,844 1.60+++ 0.61+++ 19
11/30/98 11.31 9.58 128,344 1.46 1.12 51
1/31/99# 11.50 3.56 142,497 1.46+ (0.10) 10
1/31/00 12.28 17.99 253,962 1.21 1.16 75
7/31/00+ 13.06 6.35 310,015 1.15+ 1.49+ 34
</TABLE>
---------------
* Calculated based upon average shares outstanding
** After fee waivers and expense reimbursements by the investment adviser
*** Does not reflect expenses that apply to the separate accounts of the
insurance companies. If such expenses had been included, total return
would have been lower for each period presented.
# The Portfolio changed its fiscal year ended from November 30 to January
31.
+ Annualized
+ Unaudited
++ During the below stated periods, 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>
<CAPTION>
EXPENSES
----------------------------------------------------
11/95 11/96 11/97 11/98 1/99+ 1/00 7/00+
<S> <C> <C> <C> <C> <C> <C> <C>
----------------------------------------------------
Alliance Growth................ 0.79% 0.71% 0.65% 0.58% 0.63% 0.63% 0.64%
Aggressive Growth.............. -- 1.09 0.90 0.83 0.82 0.75 0.69
International Growth and
Income......................... -- -- 2.02 1.46 1.46 1.21 1.15
<CAPTION>
NET INVESTMENT INCOME(LOSS)
-----------------------------------------------------
11/95 11/96 11/97 11/98 1/99+ 1/00 7/00+
<S> <C> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------
Alliance Growth................ 0.51% 0.51% 0.37% 0.27% (0.01)% (0.11)% (0.14)%
Aggressive Growth.............. -- 0.42 (0.13) 0.32 0.13 0.02 0.10
International Growth and
Income......................... -- -- 0.19 1.12 (0.10) 1.16 1.49
</TABLE>
4
<PAGE> 5
----------------------------------------------
PROSPECTUS
APRIL 20, 2000
----------------------------------------------
SUNAMERICA SERIES TRUST
-- CASH MANAGEMENT PORTFOLIO
-- SUNAMERICA BALANCED PORTFOLIO
-- EQUITY INDEX PORTFOLIO
-- DAVIS VENTURE VALUE PORTFOLIO
-- ALLIANCE GROWTH PORTFOLIO
-- AGGRESSIVE GROWTH PORTFOLIO
-- INTERNATIONAL GROWTH AND INCOME PORTFOLIO
the SECURITIES AND EXCHANGE COMMISSION HAS NOT
APPROVED OR DISAPPROVED THESE SECURITIES OR
PASSED UPON THE ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE> 6
--------------------------------------------------------------------------------
TABLE OF CONTENTS
--------------------------------------------------------------------------------
<TABLE>
<S> <C>
TRUST HIGHLIGHTS............................................ 3
Q&A....................................................... 3
ACCOUNT INFORMATION......................................... 12
MORE INFORMATION ABOUT THE PORTFOLIOS....................... 13
Investment Strategies..................................... 13
GLOSSARY.................................................... 15
Investment Terminology.................................... 15
Risk Terminology.......................................... 17
MANAGEMENT.................................................. 19
Investment Adviser and Manager............................ 19
Information about the Subadvisers......................... 19
Portfolio Management...................................... 20
Custodian, Transfer and Dividend-Paying Agent............. 22
FINANCIAL HIGHLIGHTS........................................ 22
FOR MORE INFORMATION........................................ 25
</TABLE>
2
<PAGE> 7
Q&A
CAPITAL APPRECIATION/GROWTH is an increase in the market value of
securities held.
YIELD is the annual dollar income received on an investment expressed
as a percentage of the current or average price.
TOTAL RETURN is a measure of performance which combines all elements
of return including income and capital gain or loss; it represents the
change in value of an investment over a given period expressed as a
percentage of the initial investment.
MARKET CAPITALIZATION represents the total market value of the
outstanding securities of a corporation.
--------------------------------------------------------------------
TRUST HIGHLIGHTS
--------------------------------------------------------------------
The following questions and answers are designed to give you an
overview of SunAmerica Series Trust (the "Trust") and to provide you
with information about seven of the Trust's separate investment
series ("Portfolios") and their investment goals and principal
strategies. More complete investment information is provided in the
charts, under "More Information About the Portfolios," which begin
on page 13, and the glossary that follows on page 15.
Q: WHAT ARE THE PORTFOLIOS' INVESTMENT GOALS AND PRINCIPAL INVESTMENT
STRATEGIES?
A: Each Portfolio operates as a separate mutual fund, with its own investment
goal and a principal strategy for pursuing it. A Portfolio's investment
goal may be changed without shareholder approval, but you will be notified
of any change. There can be no assurance that any Portfolio will meet its
investment goal or that the net return on an investment will exceed what
could have been obtained through other investment or savings vehicles.
PORTFOLIOS
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------
PORTFOLIO INVESTMENT GOAL PRINCIPAL INVESTMENT STRATEGY
----------------------------------------------------------------------------------------------
<S> <C> <C>
Cash Management high current yield while invests in a diversified selection
Portfolio preserving capital of money market instruments
----------------------------------------------------------------------------------------------
SunAmerica Balanced conservation of maintains at all times a balanced
Portfolio principal portfolio of stocks and bonds, with
at least 25% invested in fixed
income securities
----------------------------------------------------------------------------------------------
Equity Index Portfolio investment results that invests primarily in common stocks
correspond with the included in the S&P 500(R)
performance of the
Standard & Poor's 500(R)
Composite Stock Price
Index ("S&P 500(R)")
----------------------------------------------------------------------------------------------
Davis Venture Value growth of capital invests primarily in common stocks
Portfolio of companies with market
capitalizations of at least $5
billion
----------------------------------------------------------------------------------------------
Alliance Growth long-term growth of invests primarily in equity
Portfolio capital securities of a limited number of
large, carefully selected, high
quality U.S. companies that are
judged likely to achieve superior
earnings
----------------------------------------------------------------------------------------------
Aggressive Growth capital appreciation invests primarily in equity
Portfolio securities of high growth companies
including small and medium sized
growth companies with market
capitalizations of $1.5 billion to
$10 billion
----------------------------------------------------------------------------------------------
International Growth growth of capital and, invests primarily in common stocks
and Income Portfolio secondarily, current traded on markets outside the U.S.
income
----------------------------------------------------------------------------------------------
</TABLE>
3
<PAGE> 8
Q: WHAT ARE THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIOS?
A: The following section describes the principal risks of each Portfolio, while
the charts beginning on page 13 describe various additional risks.
Risks of Investing in Equity Securities
The EQUITY INDEX, DAVIS VENTURE VALUE, ALLIANCE GROWTH, AGGRESSIVE GROWTH
and INTERNATIONAL GROWTH AND INCOME PORTFOLIOS invest primarily in equity
securities. In addition, the SUNAMERICA BALANCED PORTFOLIO invests
significantly in equities. As with any equity fund, the value of your
investment in any of these Portfolios may fluctuate in response to stock
market movements. Growth stocks are historically volatile, which will
particularly affect the ALLIANCE GROWTH, AGGRESSIVE GROWTH and INTERNATIONAL
GROWTH AND INCOME PORTFOLIOS. You should be aware that the performance of
different types of equity stocks may rise or decline under varying market
conditions -- for example, "value" stocks may perform well under
circumstances in which "growth" stocks in general have fallen, or vice
versa. In addition, individual stocks selected for any of these Portfolios
may underperform the market generally.
Risks of Investing in Bonds
The SUNAMERICA BALANCED PORTFOLIO invests significantly in bonds. As with
any bond fund, the value of your investment in such Portfolio may go up or
down in response to changes in interest rates or defaults (or even the
potential for future default) by bond issuers. To the extent a Portfolio is
invested in the bond market, movements in the bond market generally may
affect its performance. In addition, individual bonds selected for such
Portfolio may underperform the market generally.
Risks of Investing in Money Market Securities
While an investment in the CASH MANAGEMENT PORTFOLIO should present the
least market risk of any of the Portfolios since it invests only in
high-quality short-term debt obligations (money market securities), you
should be aware that an investment in the CASH MANAGEMENT PORTFOLIO is
subject to the risk that the value of its investments may be subject to
changes in interest rates. The CASH MANAGEMENT PORTFOLIO does not seek to
maintain a stable net asset value of $1.00.
Risks of Investing Internationally
Except for the CASH MANAGEMENT PORTFOLIO, all of the Portfolios may invest
internationally, including in "emerging market" countries. While investing
internationally may reduce your risk by increasing the diversification of
your investment, the value of your investment may be affected by fluctuating
currency values, changing local and regional economic, political and social
conditions, and greater market volatility, and, in addition, foreign
securities may not be as liquid as domestic securities. These risks affect
all the Portfolios except for the CASH MANAGEMENT PORTFOLIO and are primary
risks of the INTERNATIONAL GROWTH AND INCOME PORTFOLIO.
Risks of Investing in Smaller Companies
Stocks of smaller companies may be more volatile than, and not as liquid as,
those of larger companies. This will particularly affect the ALLIANCE
GROWTH, AGGRESSIVE GROWTH and INTERNATIONAL GROWTH AND INCOME PORTFOLIOS.
Risks of a "Passively Managed" Strategy
The EQUITY INDEX PORTFOLIO will not deviate from its strategy (except to the
extent necessary to comply with federal tax laws). Since the Portfolio is
committed to a strategy, if that strategy is unsuccessful, the Portfolio
will not meet its investment goal. Because the Portfolio will not use
certain techniques available to other mutual funds to reduce stock market
exposure, the Portfolio may be more susceptible to general market declines
than other Portfolios.
Additional Principal Risks
Shares of the Portfolios are not bank deposits and are not guaranteed or
insured by any bank, government entity or the Federal Deposit Insurance
Corporation. As with any mutual fund, there is no guarantee that a Portfolio
will be able to achieve its investment goals. If the value of the assets of
a Portfolio goes down, you could lose money.
4
<PAGE> 9
Q: HOW HAVE THE PORTFOLIOS PERFORMED HISTORICALLY?
A: The following Risk/Return Bar Charts and Tables illustrate the risks of
investing in the Portfolios by showing changes in the Portfolios'
performance from calendar year to calendar year, and comparing the
Portfolios' average annual returns to those of an appropriate market index.
Fees and expenses incurred at the contract level are not reflected in the
bar charts and tables. If these amounts were reflected, returns would be
less than those shown. Of course, past performance is not necessarily an
indication of how a Portfolio will perform in the future.
----------------------------------------------------------------------------
CASH MANAGEMENT PORTFOLIO
----------------------------------------------------------------------------
[BAR CHART]
<TABLE>
<CAPTION>
<S> <C>
1994 3.80%
1995 5.48%
1996 4.91%
1997 5.22%
1998 5.05%
1999 4.87%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
1.36% (quarter ended 06/30/95) and the lowest return for a quarter was 0.64%
(quarter ended 03/31/94). For the most recent calendar quarter ended 03/31/00,
the return was 1.29%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS (AS OF THE PAST ONE PAST FIVE RETURN SINCE
CALENDAR YEAR ENDED DECEMBER 31, 1999) YEAR YEARS INCEPTION(1)
<S> <C> <C> <C>
-----------------------------------------------------------------------------------------------
Cash Management Portfolio 4.87% 5.11% 4.57%
-----------------------------------------------------------------------------------------------
</TABLE>
(1) Inception date for the Portfolio is February 9, 1993.
5
<PAGE> 10
--------------------------------------------------------------------------------
SUNAMERICA BALANCED PORTFOLIO
--------------------------------------------------------------------------------
[BAR CHART]
<TABLE>
<CAPTION>
<S> <C>
1997 24.48%
1998 24.61%
1999 21.40%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
15.55% (quarter ended 12/31/98) and the lowest return for a quarter was -5.24%
(quarter ended 09/30/98). For the most recent calendar quarter ended 03/31/00,
the return was 4.23%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS (AS OF THE PAST ONE RETURN SINCE
CALENDAR YEAR ENDED DECEMBER 31, 1999) YEAR INCEPTION(1)
<S> <C> <C>
-----------------------------------------------------------------------------------------
SunAmerica Balanced Portfolio 21.40% 22.67%
-----------------------------------------------------------------------------------------
S&P 500(R)(2) 21.03% 26.60%
-----------------------------------------------------------------------------------------
Lehman Brothers Aggregate Index(3) -0.81% 6.60%
-----------------------------------------------------------------------------------------
Blended Index(4) 11.54% 17.41%
-----------------------------------------------------------------------------------------
</TABLE>
(1) Inception date for the Portfolio is June 3, 1996. The since inception
returns for the comparative indices are as of the inception date month end.
(2) The S&P 500(R) Index tracks the performance of 500 stocks representing a
sampling of the largest foreign and domestic stocks traded publicly in the
United States. Because it is market-weighted, the index will reflect
changes in larger companies more heavily than those in smaller companies.
(3) The Lehman Brothers Aggregate Index combines several Lehman Brothers
fixed-income indices to give a broad view of the bond market -- 70%
reflects the Government/Corporate Bond Index, 29% reflects the
Mortgage-Backed Securities Index and 1% reflects the Asset-Backed
Securities Index.
(4) The Blended Index consists of 55% S&P 500(R) Index, 35% Lehman Brothers
Aggregate Index, and 10% Treasury Bills. Treasury Bills are short-term
securities with maturities of one-year or less issued by the U.S.
Government.
6
<PAGE> 11
--------------------------------------------------------------------------------
EQUITY INDEX PORTFOLIO
--------------------------------------------------------------------------------
[BAR CHART}
<TABLE>
<CAPTION>
<S> <C>
1999 17.14%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
14.57% (quarter ended 12/31/99) and the lowest return for a quarter was -7.18%
(quarter ended 09/30/99). For the most recent calendar quarter ended 03/31/00,
the return was 2.08%.
--------------------------------------------------------------------------------
<TABLE>
AVERAGE ANNUAL TOTAL RETURNS (AS OF THE PAST ONE RETURN SINCE
CALENDAR YEAR ENDED DECEMBER 31, 1999) YEAR INCEPTION(1)
<S> <C> <C>
-----------------------------------------------------------------------------------------
Equity Index Portfolio 17.14% 24.75%
-----------------------------------------------------------------------------------------
S&P 500(R)(2) 21.03% 26.61%
-----------------------------------------------------------------------------------------
</TABLE>
(1) Inception date for the Portfolio is December 14, 1998. The since inception
return for the comparative index is as of the inception date month end.
(2) The S&P 500(R) Index tracks the performance of 500 stocks representing a
sampling of the largest foreign and domestic stocks traded publicly in the
United States. Because it is market-weighted, the index will reflect
changes in larger companies more heavily than those in smaller companies.
7
<PAGE> 12
--------------------------------------------------------------------------------
DAVIS VENTURE VALUE PORTFOLIO
--------------------------------------------------------------------------------
[BAR CHART]
<TABLE>
<CAPTION>
<S> <C>
1995 37.45%
1996 24.76%
1997 34.32%
1998 13.73%
1999 16.11%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
21.07% (quarter ended 12/31/98) and the lowest return for a quarter was -14.87%
(quarter ended 09/30/98). For the most recent calendar quarter ended 03/31/00,
the return was 9.85%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS (AS OF THE CALENDAR YEAR ENDED PAST ONE PAST FIVE RETURN SINCE
DECEMBER 31, 1999) YEAR YEARS INCEPTION(1)
<S> <C> <C> <C>
----------------------------------------------------------------------------------------------------
Davis Venture Value Portfolio(2) 16.11% 24.92% 23.75%
----------------------------------------------------------------------------------------------------
S&P 500(R)(3) 21.03% 28.56% 26.90%
----------------------------------------------------------------------------------------------------
</TABLE>
(1) Inception date for the Portfolio is October 28, 1994. The since inception
return for the comparative index is as of the inception date month end.
(2) Prior to April 10, 2000, the Davis Venture Value Portfolio was named the
Venture Value Portfolio.
(3) The S&P 500(R) Index tracks the performance of 500 stocks representing a
sampling of the largest foreign and domestic stocks traded publicly in the
United States. Because it is market-weighted, the index will reflect
changes in larger companies more heavily than those in smaller companies.
8
<PAGE> 13
--------------------------------------------------------------------------------
ALLIANCE GROWTH PORTFOLIO
--------------------------------------------------------------------------------
[BAR CHART]
<TABLE>
<S> <C>
1994 -2.16%
1995 43.79%
1996 29.11%
1997 31.43%
1998 52.23%
1999 33.07%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
32.57% (quarter ended 12/31/98) and the lowest return for a quarter was -12.54%
(quarter ended 09/30/98). For the most recent calendar quarter ended 03/31/00,
the return was 7.01%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS (AS OF THE CALENDAR YEAR ENDED DECEMBER PAST ONE PAST FIVE RETURN SINCE
31, 1999) YEAR YEARS INCEPTION(1)
<S> <C> <C> <C>
------------------------------------------------------------------------------------------------------------
Alliance Growth Portfolio 33.07% 37.66% 27.69%
------------------------------------------------------------------------------------------------------------
Russell 1000 Growth Index(2) 33.16% 32.41% 23.75%
------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Inception date for the Portfolio is February 9, 1993. The since inception
return for the comparative index is as of the inception date month end.
(2) The Russell 1000 Growth Index consists of stocks with a
greater-than-average growth orientation. Companies in this index tend to
exhibit higher price-to-book and price-earnings ratios, lower dividend
yields and higher forecasted growth values.
9
<PAGE> 14
--------------------------------------------------------------------------------
AGGRESSIVE GROWTH PORTFOLIO
--------------------------------------------------------------------------------
[BAR CHART]
<TABLE>
<S> <C>
1997 12.35%
1998 17.43%
1999 84.66%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
53.68% (quarter ended 12/31/99) and the lowest return for a quarter was -17.31%
(quarter ended 09/30/98). For the most recent calendar quarter ended 03/31/00,
the return was 8.30%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAST ONE RETURN SINCE
AVERAGE ANNUAL TOTAL RETURNS (AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) YEAR INCEPTION(1)
<S> <C> <C>
----------------------------------------------------------------------------------------------------------
Aggressive Growth Portfolio 84.66% 30.10%
----------------------------------------------------------------------------------------------------------
Russell 2000 Index(2) 21.25% 11.15%
----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Inception date for the Portfolio is June 3, 1996. The since inception
return for the comparative index is as of the inception date month end.
(2) The Russell 2000 Index is comprised of the smallest 2000 companies in the
Russell 3000 Index, representing approximately 11% of the Russell 3000
total market capitalization. The Index was developed with a base value of
$135,000 as of December 31, 1986.
10
<PAGE> 15
--------------------------------------------------------------------------------
INTERNATIONAL GROWTH AND INCOME PORTFOLIO
--------------------------------------------------------------------------------
[BAR CHART]
<TABLE>
<S> <C>
1998 10.83%
1999 24.18%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
14.81% (quarter ended 12/31/98) and the lowest return for a quarter was -17.57%
(quarter ended 09/30/98). For the most recent calendar quarter ended 03/31/00,
the return was 2.87%.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAST ONE RETURN SINCE
AVERAGE ANNUAL TOTAL RETURNS (AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) YEAR INCEPTION(1)
<S> <C> <C>
----------------------------------------------------------------------------------------------------------
International Growth and Income Portfolio 24.18% 15.87%
----------------------------------------------------------------------------------------------------------
MSCI EAFE Index(2) 27.31% 16.44%
----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Inception date for the Portfolio is June 2, 1997. The since inception
return for the comparative index is as of the inception date month end.
(2) The Morgan Stanley Capital International (MSCI) Europe, Australia, and Far
East (EAFE) Index represents the foreign stocks of 20 developed market
countries in Europe, Australia and the Far East.
11
<PAGE> 16
--------------------------------------------------------------------------------
ACCOUNT INFORMATION
--------------------------------------------------------------------------------
Shares of the Portfolios are not offered directly to the public. Instead, shares
are currently issued and redeemed only in connection with investments in and
payments under variable annuity contracts and variable life insurance policies
(Variable Contracts) of Anchor National Life Insurance Company, First SunAmerica
Life Insurance Company, AIG Life Insurance Company and American International
Life Assurance Company of New York (Life Companies), each of which is affiliated
with the Trust's investment adviser and manager, SunAmerica Asset Management
Corp. (SAAMCo). All shares of the Trust are owned by "Separate Accounts" of the
Life Companies. So if you would like to invest in a Portfolio, you must purchase
a Variable Contract from one of the Life Companies. You should be aware that the
contracts involve fees and expenses that are not described in this Prospectus,
and that the contracts also may involve certain restrictions and limitations.
Certain Portfolios may not be available in connection with a particular
contract. You will find information about purchasing a Variable Contract and the
Portfolios available to you in the prospectus that offers the contracts, which
accompanies this Prospectus.
TRANSACTION POLICIES
VALUATION OF SHARES The net asset value per share (NAV) for each Portfolio is
determined each business day at the close of regular trading on the New York
Stock Exchange (generally 4:00 p.m., Eastern time) by dividing its net assets by
the number of its shares outstanding. Investments for which market quotations
are readily available are valued at market. All other securities and assets are
valued at "fair value" following procedures approved by the Trustees.
Certain of the Portfolios may invest to a large extent in securities that are
primarily listed on foreign exchanges that trade on weekends or other days when
the Trust does not price its shares. As a result, the value of these Portfolios'
shares may change on days when the Trust is not open for purchases or
redemptions.
BUY AND SELL PRICES The Separate Accounts buy and sell shares of a Portfolio at
NAV, without any sales or other charges.
EXECUTION OF REQUESTS The Trust is open on those days when the New York Stock
Exchange is open for regular trading. Buy and sell requests are executed at the
next NAV to be calculated after the request is accepted by the Trust. If the
order is received by the Trust before the Trust's close of business (generally
4:00 p.m., Eastern time), the order will receive that day's closing price. If
the order is received after that time, it will receive the next business day's
closing price.
During periods of extreme volatility or market crisis, a Portfolio may
temporarily suspend the processing of sell requests, or may postpone payment of
proceeds for up to seven business days or longer, as allowed by federal
securities laws.
DIVIDEND POLICIES AND TAXES
DISTRIBUTIONS Each Portfolio annually declares and distributes substantially all
of its net investment income in the form of dividends and capital gains
distributions.
DISTRIBUTION REINVESTMENT The dividends and distributions will be reinvested
automatically in additional shares of the same Portfolio on which they were
paid.
TAXABILITY OF A PORTFOLIO Each Portfolio intends to continue to qualify as a
regulated investment company under the Internal Revenue Code of 1986, as
amended. As long as each Portfolio is qualified as a regulated investment
company, it will not be subject to federal income tax on the earnings that it
distributes to its shareholders.
12
<PAGE> 17
--------------------------------------------------------------------------------
MORE INFORMATION ABOUT THE PORTFOLIOS
--------------------------------------------------------------------------------
INVESTMENT STRATEGIES
Each Portfolio has its own investment goal and principal strategy for pursuing
it as described in the charts beginning on page 3. The charts below summarize
information about each Portfolio's investments. We have included a glossary to
define the investment and risk terminology used in the charts throughout this
Prospectus. Unless otherwise indicated, investment restrictions, including
percentage limitations, apply at the time of purchase.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------
PORTFOLIOS
-----------------------------------------------------------------------------------------------------------------------
CASH
MANAGEMENT SUNAMERICA
BALANCED
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
What are the Portfolio's principal - Fixed income securities: - Equity securities:
investments? - U.S. treasury bills - common stocks
- agency discount notes - Fixed income securities:
- commercial paper - U.S. government securities
- corporate debt instruments - corporate debt instruments
- Short-term investments
-----------------------------------------------------------------------------------------------------------------------
In what other types of investments N/A - Equity securities:
may the Portfolio significantly - small-cap stocks
invest? (up to 20%)
- Short-term investments
(up to 10%)
- Defensive investments
- Foreign securities
- Illiquid securities
(up to 15%)
-----------------------------------------------------------------------------------------------------------------------
What other types of investments may N/A - Options and futures
the Portfolio use as part of - Currency transactions
efficient portfolio management or - Borrowing for temporary or
to enhance return? emergency purposes (up to 33 1/3%)
- Securities lending
(up to 33 1/3%)
-----------------------------------------------------------------------------------------------------------------------
What risks normally affect the - Interest rate fluctuations - Market volatility
Portfolio? - Security selection - Interest rate fluctuations
- Credit quality
- Currency volatility
- Foreign exposure
- Derivatives
- Hedging
-----------------------------------------------------------------------------------------------------------------------
</TABLE>
13
<PAGE> 18
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
PORTFOLIOS
-----------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL
DAVIS VENTURE AGGRESSIVE GROWTH AND
EQUITY INDEX VALUE ALLIANCE GROWTH GROWTH INCOME
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
What are the - Equity - Equity - Equity - Equity - Equity
Portfolio's securities: securities: securities: securities: securities:
principal - common stocks - large-cap stocks - large-cap stocks - small-cap stocks - large-cap stocks
investments? - mid-cap stocks (foreign)
- convertible - Foreign
securities securities
- warrants
- Defensive
investments
- Options and
futures
-----------------------------------------------------------------------------------------------------------------------------
In what other types N/A - Mid-cap stocks - Foreign N/A - Equity
of investments may - Foreign securities securities:
the Portfolio securities (up to 25%) - mid-cap stocks
significantly (foreign)
invest? - Foreign
securities:
- emerging
markets
-----------------------------------------------------------------------------------------------------------------------------
What other types of - Short-term - Short-term - Short-term - Borrowing for - Equity
investments may the investments investments investments temporary or securities:
Portfolio use as - Defensive - Defensive - Defensive emergency - small-cap
part of efficient investments investments investments purposes stocks
portfolio - Options and - U.S. government - Borrowing for (up to 33 1/3%) (foreign)
management or to futures securities temporary or - Illiquid - large-cap stocks
enhance return? (up to 20%) emergency securities (up to (U.S.)
- Borrowing for purposes 33 1/3%) - Currency
temporary or (up to 33 1/3%) - Short-term transactions
emergency - Options and Investments - Short-term
purposes futures investments
(up to 33 1/3%)
- Securities
lending
(up to 33 1/3%)
- Illiquid
securities
(up to 15%)
- Foreign
securities
- Small-cap stocks
- Registered
investment
companies
- Firm commitments
- When issued and
delayed-delivery
transactions
-----------------------------------------------------------------------------------------------------------------------------
What risks normally - Market - Market - Market - Market - Currency
affect the volatility volatility volatility volatility volatility
Portfolio? - Passively- - Securities - Securities - Securities - Foreign exposure
managed selection selection selection - Market
strategy - Active trading - Illiquidity volatility
- Active trading - Growth stocks - Interest rate - Securities
fluctuations selection
- Small and medium - Hedging
sized companies
- Credit quality
- Derivatives
- Hedging
- Emerging markets
- Active trading
- Growth stocks
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
14
<PAGE> 19
--------------------------------------------------------------------------------
GLOSSARY
--------------------------------------------------------------------------------
INVESTMENT TERMINOLOGY
BORROWING FOR TEMPORARY OR EMERGENCY PURPOSES involves the borrowing of cash or
securities by a Portfolio in limited circumstances, including to meet
redemptions. Borrowing will cost a Portfolio interest expense and other fees.
Borrowing may exaggerate changes in a Portfolio's net asset value and the cost
may reduce a Portfolio's return.
CURRENCY TRANSACTIONS include the purchase and sale of currencies to facilitate
the settlement of securities transactions and forward currency contracts, which
are used to hedge against changes in currency exchange rates.
DEFENSIVE INVESTMENTS include high quality fixed income securities, repurchase
agreements and other money market instruments. A Portfolio will make temporary
defensive investments in response to adverse market, economic, political or
other conditions. When a Portfolio takes a defensive position, it may miss out
on investment opportunities that could have resulted from investing in
accordance with its principal investment strategy. As a result, a Portfolio may
not achieve its investment goal.
EQUITY SECURITIES, such as COMMON STOCKS, represent shares of equity ownership
in a corporation. Common stocks may or may not receive dividend payments.
Certain securities have common stock characteristics, including certain
convertible securities such as CONVERTIBLE PREFERRED STOCK, CONVERTIBLE BONDS,
WARRANTS and RIGHTS, and may be classified as equity securities. Investments in
equity securities and securities with equity characteristics include:
- LARGE-CAP STOCKS are common stocks of large companies that generally have
market capitalizations of over $9.5 billion, although there may be some
overlap among capitalization categories. Market capitalization categories
may change based on market conditions or changes in market capitalization
classifications as defined by agencies such as Standard & Poor's (S&P),
the Frank Russell Company (Russell), Morningstar, Inc. (Morningstar) or
Lipper, Inc. (Lipper).
- MID-CAP STOCKS are common stocks of medium sized companies that generally
have market capitalizations ranging from $1.5 billion to $9.5 billion,
although there may be some overlap among capitalization categories.
Market capitalization categories may change based on market conditions or
changes in market capitalization classifications as defined by agencies
such as S&P, Russell, Morningstar or Lipper.
- SMALL-CAP STOCKS are common stocks of small companies that generally have
market capitalizations of $1.5 billion or less, although there may be
some overlap among capitalization categories. Market capitalization
categories may change based on market conditions or changes in market
capitalization classifications as defined by agencies such as S&P,
Russell, Morningstar, or Lipper.
- CONVERTIBLE SECURITIES are securities (such as bonds or preferred stocks)
that may be converted into common stock of the same or a different
company.
- WARRANTS are rights to buy common stock of a company at a specified price
during the life of the warrant.
- RIGHTS represent a preemptive right of stockholders to purchase
additional shares of a stock at the time of a new issuance before the
stock is offered to the general public.
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. At the time of delivery of the securities, the value may be more or
less than the purchase price.
FIXED INCOME SECURITIES are broadly classified as securities that provide for
periodic payment, typically interest or dividend 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 do not provide for repayment of a principal
amount. The issuer of a SENIOR FIXED
15
<PAGE> 20
INCOME SECURITY is obligated to make payments on this security ahead of other
payments to security holders. Investments in fixed income securities include:
- U.S. GOVERNMENT SECURITIES are issued or guaranteed by the U.S.
government, its agencies and instrumentalities. Some U.S. government
securities are issued or unconditionally guaranteed by the U.S. Treasury.
They are of the highest possible credit quality. While these securities
are subject to variations in market value due to fluctuations in interest
rates, they will be paid in full if held to maturity. Other U.S.
government securities are neither direct obligations of, nor guaranteed
by, the U.S. Treasury. However, they involve federal sponsorship in one
way or another. For example, 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; and others are
supported only by the credit of the issuing government agency or
instrumentality.
- CORPORATE DEBT INSTRUMENTS (BONDS, NOTES AND DEBENTURES) are securities
representing a debt of a corporation. The issuer is obligated to repay a
principal amount of indebtedness at a stated time in the future and in
most cases to make periodic payments of interest at a stated rate.
- An INVESTMENT GRADE FIXED INCOME SECURITY is rated in one of the top four
rating categories by a debt rating agency (or is considered of comparable
quality by the Adviser or Subadviser). The two best-known debt rating
agencies are S&P and Moody's Investors Service, Inc.( Moody's).
INVESTMENT GRADE refers to any security rated "BBB" or above by S&P or
"Baa" or above by Moody's.
FOREIGN SECURITIES are issued by companies located outside of the United States,
including emerging markets. Foreign securities may include foreign corporate and
government bonds, foreign equity securities, foreign investment companies,
passive foreign investment companies (PFICs), American Depositary Receipts
(ADRs) or other similar securities that represent interests in foreign equity
securities, such as European Depositary Receipts (EDRs) and Global Depositary
Receipts (GDRs). An EMERGING MARKET country is generally one with a low or
middle income or economy or that is in the early stages of its industrialization
cycle. For fixed income investments, an emerging market includes those where the
sovereign credit rating is below investment grade. Emerging market countries may
change over time depending on market and economic conditions and the list of
emerging market countries may vary by Adviser or Subadviser.
FORWARD COMMITMENTS are commitments to purchase or sell securities at a future
date. A Portfolio purchasing a forward commitment assumes the risk of any
decline in value of the securities beginning on the date of the agreement.
Similarly, a Portfolio selling such securities does not participate in further
gains or losses on the date of the agreement.
ILLIQUID/RESTRICTED SECURITIES are subject to legal or contractual restrictions
that may make them difficult to sell. A security that cannot easily be sold
within seven days will generally be considered illiquid. Certain restricted
securities (such as Rule 144A securities) are not generally considered illiquid
because of their established trading market.
OPTIONS AND FUTURES are contracts involving the right to receive or the
obligation to deliver assets or money depending on the performance of one or
more underlying assets or a market or economic index. An option gives its owner
the right, but not the obligation, to buy ("call") or sell ("put") a specified
amount of a security at a specified price within in a specified time period. A
futures contract is an exchange-traded legal contract to buy or sell a standard
quantity and quality of a commodity, financial instrument, index, etc. at a
specified future date and price.
REGISTERED INVESTMENT COMPANIES are investments by a Portfolio in other
investment companies which are registered in accordance with the federal
securities laws.
SECURITIES LENDING involves a loan of securities by a Portfolio in exchange for
cash or collateral. A Portfolio earns interest on the loan while retaining
ownership of the security.
16
<PAGE> 21
SHORT-TERM INVESTMENTS include money market securities such as short-term U.S.
government obligations, repurchase agreements, commercial paper, bankers'
acceptances and certificates of deposit. These securities provide a Portfolio
with sufficient liquidity to meet redemptions and cover expenses.
RISK TERMINOLOGY
ACTIVE TRADING: A strategy used whereby the Portfolio may engage in frequent
trading of portfolio securities to achieve its investment goal. Active trading
may result in high portfolio turnover and correspondingly greater brokerage
commissions and other transaction costs, which will be borne directly by a
Portfolio. In addition, because a Portfolio may sell a security without regard
to how long it has held the security, active trading may have tax consequences
for certain shareholders, involving a possible increase in short-term capital
gains or losses. During periods of increased market volatility, active trading
may be more pronounced. In the "Financial Highlights" section we provide each
Portfolio's portfolio turnover rate for each of the last five fiscal years.
CREDIT QUALITY: The creditworthiness of the issuer is always a factor in
analyzing fixed income securities. An issuer with a lower credit rating will be
more likely than a higher rated issuer to default or otherwise become unable to
honor its financial obligations. This type of issuer will typically issue JUNK
BONDS. In addition to the risk of default, junk bonds may be more volatile, less
liquid, more difficult to value and more susceptible to adverse economic
conditions or investor perceptions than other bonds.
CURRENCY VOLATILITY: The value of a Portfolio's foreign investments may
fluctuate due to changes in currency rates. A 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-U.S. dollar denominated securities.
DERIVATIVES: A derivative is any financial instrument whose value is based on,
and determined by, another security, index or benchmark (i.e., stock options,
futures, caps, floors, etc.). In recent years, derivative securities have become
increasingly important in the field of finance. Futures and options are now
actively traded on many different exchanges. Forward contracts, swaps, and many
different types of options are regularly traded outside of exchanges by
financial institutions in what are termed "over the counter" markets. Other more
specialized derivative securities often form part of a bond or stock issue. To
the extent a contract is used to hedge another position in the portfolio, the
Portfolio will be exposed to the risks associated with hedging as describe in
this glossary. To the extent an option or futures contract is used to enhance
return, rather than as a hedge, a Portfolio will be directly exposed to the
risks of the contract. Gains or losses from non-hedging positions may be
substantially greater than the cost of the position.
FOREIGN EXPOSURE: Investors in foreign countries are subject to a number of
risks. A principal risk is that fluctuations in the exchange rates between the
U.S. dollar and foreign currencies may negatively affect an investment. In
addition, there may be less publicly available information about a foreign
company and it may not be subject to the same uniform accounting, auditing and
financial reporting standards as U.S. companies. Foreign governments may not
regulate securities markets and companies to the same degree as in the U.S.
Foreign investments will also be affected by local political or economic
developments and governmental actions. Consequently, foreign securities may be
less liquid, more volatile and more difficult to price than U.S. securities.
These risks are heightened when an issuer is in an EMERGING MARKET.
Historically, the markets of EMERGING MARKET countries have been more volatile
than more developed markets; however, such markets can provide higher rates of
return to investors.
GROWTH STOCKS: Growth stocks can be volatile for several reasons. Since the
issuers usually reinvest a high portion of earnings in their own business,
growth stocks may lack the comfortable dividend yield associated with value
stocks that can cushion total return in a bear market. Also, growth stocks
normally carry a higher price/earnings ratio than many other stocks.
Consequently, if earnings expectations are not met, the market price of growth
stocks will often go down more than other stocks. However, the market frequently
rewards growth stocks with price increases when expectations are met or
exceeded.
HEDGING: Hedging is a strategy in which a Portfolio uses a derivative security
to reduce certain risk characteristics of an underlying security or portfolio of
securities. While hedging strategies can be very
17
<PAGE> 22
useful and inexpensive ways of reducing risk, they are sometimes ineffective due
to unexpected changes in the market. Hedging also involves the risk that changes
in the value of the derivative will not match those of the instruments being
hedged as expected, in which case any losses on the instruments being hedged may
not be reduced.
ILLIQUIDITY: There may not be a market for certain securities making it
difficult or impossible to sell at the time and the price that the seller would
like.
INTEREST RATE FLUCTUATIONS: The volatility of fixed income securities is due
principally to changes in interest rates. The market value of bonds and other
fixed income securities usually tends to vary inversely with the level of
interest rates. As interest rates rise the value of such securities typically
falls, and as interest rates fall, the value of such securities typically rise.
Longer-term and lower coupon bonds tend to be more sensitive to changes in
interest rates.
MARKET VOLATILITY: The stock and/or bond markets as a whole could go up or down
(sometimes dramatically). This could affect the value of the securities in a
Portfolio's portfolio.
PASSIVELY MANAGED STRATEGY: A Portfolio following a passively managed strategy
will not deviate from its investment strategy. In the case of "Dogs" of Wall
Street Portfolio, this entails buying and holding thirty stocks selected through
objective selection criteria (except to the extent necessary to comply with
applicable federal tax laws). In other cases, it may involve a passively managed
strategy utilized to achieve investment results that correspond to a particular
market index. Such a Portfolio will not sell stocks in its portfolio and buy
different stocks over the course of a year, even if there are adverse
developments concerning a particular stock, company or industry. There can be no
assurance that the strategy will be successful.
SECURITIES SELECTION: A strategy used by a Portfolio, or securities selected by
its portfolio manager, may fail to produce the intended return.
SMALL AND MEDIUM SIZED COMPANIES: Companies with smaller market capitalizations
(particularly under $1.5 billion) tend to be at early stages of development with
limited product lines, market access for products, financial resources, access
to new capital, or depth in management. Consequently, the securities of smaller
companies may not be as readily marketable and may be subject to more abrupt or
erratic market movements. Securities of medium sized companies are also usually
more volatile and entail greater risks than securities of large companies.
18
<PAGE> 23
--------------------------------------------------------------------------------
MANAGEMENT
--------------------------------------------------------------------------------
INVESTMENT ADVISER AND MANAGER
SunAmerica Asset Management Corp. (SAAMCo) serves as investment adviser and
manager for all the Portfolios of the Trust. SAAMCo selects the Subadvisers for
Portfolios, manages the investments for certain Portfolios, provides various
administrative services and supervises the daily business affairs of each
Portfolio.
SAAMCo has received an exemptive order from the Securities and Exchange
Commission that permits SAAMCo, subject to certain conditions, to enter into
agreements relating to the Trust with Subadvisers approved by the Board of
Trustees without obtaining shareholder approval. The exemptive order also
permits SAAMCo, subject to the approval of the Board but without shareholder
approval, to employ new Subadvisers for new or existing Portfolios, change the
terms of particular agreements with Subadvisers or continue the employment of
existing Subadvisers after events that would otherwise cause an automatic
termination of a subadvisory agreement. Shareholders will be notified of any
Subadviser changes. SAAMCo does not presently rely on this exemptive order with
respect to the Trust. Shareholders of a Portfolio have the right to terminate an
agreement with a Subadviser for that Portfolio at any time by a vote of the
majority of the outstanding voting securities of such Portfolio.
SAAMCo, located at The SunAmerica Center, 733 Third Avenue, New York, New York,
10017, is a corporation organized under the laws of the state of Delaware. In
addition to serving as investment adviser and manager of the Trust, SAAMCo
serves as adviser, manager and/or administrator for Anchor Pathway Fund, Anchor
Series Trust, Brazos Mutual Funds, Seasons Series Trust, SunAmerica Style Select
Series, Inc., SunAmerica Equity Funds, SunAmerica Income Funds, SunAmerica Money
Market Funds, Inc. and SunAmerica Strategic Investment Series, Inc.
For the fiscal year ended January 31, 2000, each Portfolio paid SAAMCo a fee
equal to the following percentage of average daily net assets:
<TABLE>
<CAPTION>
PORTFOLIO FEE
--------- ---
<S> <C>
Cash Management Portfolio.................... 0.49%
SunAmerica Balanced Portfolio................ 0.62%
Equity Index Portfolio....................... 0.40%
Davis Venture Value Portfolio................ 0.71%
Alliance Growth Portfolio.................... 0.60%
Aggressive Growth Portfolio.................. 0.70%
International Growth and Income Portfolio.... 0.98%
</TABLE>
INFORMATION ABOUT THE SUBADVISERS
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 whose clients primarily are
major corporate employee benefit funds, investment companies, foundations,
endowment funds and public employee retirement systems. Alliance serves as
investment manager of employee benefit fund assets for 31 of the Fortune 100
companies.
DAVIS SELECTED ADVISERS, L.P. (Davis Selected) is located at 2949 East Elvira
Road, Suite 101, Tucson, AZ 85706. Davis Selected provides advisory services to
other investment companies. The Subadvisory Agreement with Davis Selected
provides that Davis Selected may delegate any of its responsibilities under the
agreement to one of its affiliates, including Davis Selected Advisers -- NY,
Inc., a wholly-owned subsidiary; however Davis Selected remains ultimately
responsible (subject to supervision by SAAMCo) for the assets of the Portfolios
allocated to it.
19
<PAGE> 24
FIRST AMERICAN ASSET MANAGEMENT (First American) is located at 601 Second Avenue
South, Minneapolis, Minnesota 55402. First American has acted as an investment
adviser to First American Investment Funds, Inc. since its inception in 1987 and
has acted as investment adviser to First American Funds, Inc. since 1982 and to
First American Strategy Funds, Inc. since 1996.
PUTNAM INVESTMENT MANAGEMENT, INC. (Putnam), is a Massachusetts corporation with
principal offices at One Post Office Square, Boston, Massachusetts. Putnam has
been managing mutual funds since 1937 and serves as investment adviser to the
funds in the Putnam Family.
SAAMCo compensated the various Subadvisers out of the advisory fees that it
received from the respective Portfolios. SAAMCo may terminate any agreement with
another Subadviser without shareholder approval.
PORTFOLIO MANAGEMENT
The primary investment manager(s) and/or management team(s) for each portfolio
is set forth in the following table.
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
PORTFOLIO NAME AND TITLE OF EXPERIENCE
ADVISER/ PORTFOLIO MANAGER (AND/
SUBADVISER OR MANAGEMENT TEAM)
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Management Portfolio SAAMCo - Fixed Income Investment The Fixed Income
Team Investment Team has
been responsible for
the management of this
portfolio since its
inception in 1993.
----------------------------------------------------------------------------------------------------------------
SunAmerica Balanced SAAMCo - Francis D. Gannon Mr. Gannon has been a
Portfolio Senior Vice President and portfolio manager with
Portfolio Manager SAAMCo since 1996. He
joined SAAMCo in 1993
as an equity analyst.
----------------------------------------------------------------------------------------------------------------
Equity Index Portfolio First American - James S. Rovner Mr. Rovner joined
Portfolio Manager First American in 1986
as a portfolio manager
and has managed assets
for institutional and
individual clients for
over 15 years,
specializing in equity
and balanced
investment strategies.
----------------------------------------------------------------------------------------------------------------
</TABLE>
20
<PAGE> 25
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
PORTFOLIO NAME AND TITLE OF EXPERIENCE
ADVISER/ PORTFOLIO MANAGER (AND/
SUBADVISER OR MANAGEMENT TEAM)
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- Evan C. Lundquist Mr. Lundquist joined
Portfolio Manager First American in 1998
as an analyst and
portfolio manager. He
has analytic
responsibilities for
paper/forest products,
metals and mining,
steel, engineering and
construction, and
building and
appliances industries.
----------------------------------------------------------------------------------------------------------------
Davis Venture Value Davis Selected - Christopher C. Davis Mr. Davis has been
Portfolio Portfolio Manager employed by Davis
Selected since 1989 as
a research analyst,
assistant portfolio
manager, co-portfolio
manager, and portfolio
manager.
- Kenneth C. Feinberg Mr. Feinberg has been
Portfolio Manager employed by Davis
Selected since 1994 as
a research analyst,
assistant portfolio
manager, and portfolio
manager.
----------------------------------------------------------------------------------------------------------------
Alliance Growth Portfolio Alliance - James G. Reilly Mr. Reilly joined the
Executive Vice President company in 1984 as a
and Portfolio Manager research analyst. He
became a portfolio
manager in 1993 and
was promoted to an
Executive Vice
President in 1999.
----------------------------------------------------------------------------------------------------------------
Aggressive Growth Portfolio SAAMCo - Donna M. Calder Ms. Calder joined the
Vice President and firm in 1998 as a Vice
Portfolio Manager President and
portfolio manager.
Prior to joining
SAAMCo, she was the
founder and General
Partner of Manhattan
Capital Partners, L.P.
from 1991 to 1995.
----------------------------------------------------------------------------------------------------------------
</TABLE>
21
<PAGE> 26
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
PORTFOLIO NAME AND TITLE OF EXPERIENCE
ADVISER/ PORTFOLIO MANAGER (AND/
SUBADVISER OR MANAGEMENT TEAM)
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
International Growth and Putnam - Deborah F. Kuenstner Ms. Kuenster joined
Income Portfolio Chief Investment Officer Putnam as a Senior
and Managing Director Vice President and
Senior Portfolio
Manager in March 1997.
Ms. Kuenstner was
Senior Portfolio
Manager at Dupont
Pension Fund
Management from 1989
to 1997.
- George W. Stairs Mr. Stairs joined
Senior Vice President and Putnam as a Global
Portfolio Manager Equity research
analyst in 1994. In
1997, he became a
Senior Vice President
and Portfolio Manager.
Mr. Stairs was an
Associate at Value
Quest Ltd. from 1992
to 1994.
----------------------------------------------------------------------------------------------------------------
</TABLE>
CUSTODIAN, TRANSFER AND DIVIDEND PAYING AGENT
State Street Bank and Trust Company, Boston, Massachusetts, acts as Custodian of
the Trust's assets as well as Transfer and Dividend Paying Agent and in so doing
performs certain bookkeeping, data processing and administrative services.
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
The following Financial Highlights tables for each Portfolio is intended to help
you understand the Portfolios' financial performance for the past 5 years.
Certain information reflects financial results for a single Portfolio share. The
total returns in each table represent the rate that an investor would have
earned on an investment in the Portfolio (assuming reinvestment of all dividends
and distributions). This information has been audited by PricewaterhouseCoopers
LLP, whose report, along with each Portfolio's financial statements, are
included in the Trust's annual report to shareholders, which is available upon
request.
22
<PAGE> 27
---------------------
SUNAMERICA SERIES TRUST
FINANCIAL HIGHLIGHTS*
SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
PERIOD
----------------------------------------------------------------------------
<TABLE>
<CAPTION>
NET NET TOTAL DIVIDENDS DIVIDENDS NET
ASSET INVEST- NET REALIZED FROM DECLARED FROM FROM NET ASSET
VALUE MENT & UNREALIZED INVEST- NET REALIZED VALUE
PERIOD BEGINNING INCOME GAIN (LOSS) ON MENT INVESTMENT GAIN ON END OF TOTAL
ENDED OF PERIOD (LOSS)** INVESTMENTS OPERATIONS INCOME INVESTMENTS PERIOD RETURN***
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Cash Management Portfolio
11/30/95 $10.47 $0.56 $ 0.01 $ 0.57 $(0.34) $ -- $10.70 5.59%
11/30/96 10.70 0.53 (0.02) 0.51 (0.45) -- 10.76 4.92
11/30/97 10.76 0.53 0.01 0.54 (0.56) -- 10.74 5.22
11/30/98 10.74 0.54 (0.02) 0.52 (0.68) -- 10.58 5.05
1/31/99# 10.58 0.08 0.01 0.09 -- -- 10.67 0.85
1/31/00 10.67 0.51 -- 0.51 (0.24) -- 10.94 4.85
SunAmerica Balanced Portfolio
6/3/96-
11/30/96 10.00 0.10 1.03 1.13 -- -- 11.13 11.30
11/30/97 11.13 0.23 2.15 2.38 (0.04) (0.02) 13.45 21.48
11/30/98 13.45 0.30 2.33 2.63 (0.11) (0.36) 15.61 19.81
1/31/99# 15.61 0.05 1.58 1.63 -- -- 17.24 10.44
1/31/00 17.24 0.36 1.80 2.16 (0.12) (0.22) 19.06 12.76
Equity Index Portfolio
12/14/98-
1/31/99 10.00 0.01 1.17 1.18 (0.03) -- 11.15 11.81
1/31/00 11.15 0.12 0.67 0.79 (0.06) -- 11.88 7.05
Davis Venture Value Portfolio
11/30/95 9.78 0.17 3.55 3.72 (0.03) -- 13.47 38.17
11/30/96 13.47 0.18 3.46 3.64 (0.09) (0.12) 16.90 27.44
11/30/97 16.90 0.19 4.73 4.92 (0.09) (0.26) 21.47 29.62
11/30/98 21.47 0.20 2.23 2.43 (0.12) (0.68) 23.10 11.36
1/31/99# 23.10 0.03 1.25 1.28 -- -- 24.38 5.54
1/31/00 24.38 0.13 3.06 3.19 (0.20) (0.93) 26.44 13.42
<CAPTION>
NET RATIO OF NET
ASSETS RATIO OF INVESTMENT
END OF EXPENSES TO INCOME TO
PERIOD PERIOD AVERAGE NET AVERAGE PORTFOLIO
ENDED (000'S) ASSETS NET ASSETS TURNOVER
---------- ---------------------------------------------------
<S> <C> <C> <C> <C>
11/30/95 $ 90,731 0.67% 5.32% --%
11/30/96 91,247 0.62 4.90 --
11/30/97 156,119 0.63 5.06 --
11/30/98 223,640 0.58 4.97 --
1/31/99 277,370 0.62+ 5.02+ --
1/31/00 466,588 0.53 4.82 --
6/3/96
11/30/96 10,224 1.00+++ 1.92+++ 40
11/30/97 44,621 1.00 1.82 143
11/30/98 149,242 0.78 2.10 111
1/31/99 194,878 0.74+@ 1.73+@ 26
1/31/00 509,054 0.66 2.01 197
12/14/98
1/31/99 11,168 0.55+++ 0.75+++ --
1/31/00 63,487 0.55++ 1.02++ 1
11/30/95 154,908 1.00++ 1.43++ 18
11/30/96 516,413 0.85 1.21 22
11/30/97 1,140,053 0.79 0.98 22
11/30/98 1,725,411 0.75 0.89 25
1/31/99 1,840,354 0.77+ 0.86+ 5
1/31/00 2,303,994 0.74 0.51 23
</TABLE>
---------------
* Calculated based upon average shares outstanding
** After fee waivers and expense reimbursements by the investment adviser
*** Does not reflect expenses that apply to the separate accounts of the
insurance companies. If such expenses had been included, total return
would have been lower for each period presented.
# The Portfolio changed its fiscal year ended from November 30 to January
31.
+ Annualized
@ Net of custody credits of 0.01%, 0.01% and 0.02%, for the periods ending
November 30, 1998, January 31, 1999 and January 31, 2000, respectively.
++ During the below stated periods, 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>
<CAPTION>
EXPENSES NET INVESTMENT INCOME (LOSS)
--------------------------------------------- ---------------------------------------------
11/95 11/96 11/97 11/98 1/99+ 1/00 11/95 11/96 11/97 11/98 1/99+ 1/00
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
--------------------------------------------- ---------------------------------------------
Cash Management....... 0.67% 0.62% 0.63% 0.58% 0.62% 0.53% 5.32% 4.90% 5.06% 4.97% 5.02% 4.82%
SunAmerica Balanced... -- 1.43 1.00 0.78 0.74 0.66 -- 1.49 1.82 2.10 1.73 2.01
Equity Index ......... -- -- -- -- 1.80 0.85 -- -- -- -- 0.50 0.72
Davis Venture Value... 1.02 0.85 0.79 0.75 0.77 0.74 1.41 1.21 0.98 0.89 0.86 0.51
</TABLE>
23
<PAGE> 28
---------------------
SUNAMERICA SERIES TRUST
FINANCIAL HIGHLIGHTS* (continued)
SELECTED DATA FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH
PERIOD
----------------------------------------------------------------------------
<TABLE>
<CAPTION>
NET NET TOTAL DIVIDENDS DIVIDENDS NET
ASSET INVEST- NET REALIZED FROM DECLARED FROM FROM NET ASSET
VALUE MENT & UNREALIZED INVEST- NET REALIZED VALUE
PERIOD BEGINNING INCOME GAIN (LOSS) ON MENT INVESTMENT GAIN ON END OF TOTAL
ENDED OF PERIOD (LOSS)** INVESTMENTS OPERATIONS INCOME INVESTMENTS PERIOD RETURN***
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Alliance Growth Portfolio
11/30/95 $10.64 $ 0.07 $ 5.08 $ 5.15 $(0.03) $(0.13) $15.63 48.91%
11/30/96 15.63 0.08 4.07 4.15 (0.04) (1.01) 18.73 28.05
11/30/97 18.73 0.16 4.76 4.92 (0.05) (1.04) 22.56 27.80
11/30/98 22.56 0.07 7.77 7.84 (0.06) (2.30) 28.04 35.92
1/31/99# 28.04 0.00 7.22 7.22 -- -- 35.26 25.75
1/31/00 35.26 (0.04) 4.46 4.42 (0.05) (3.05) 36.58 14.09
Aggressive Growth Portfolio
6/3/96-
11/30/96 10.00 0.02 0.34 0.36 -- -- 10.36 3.60
11/30/97 10.36 0.01 1.40 1.41 (0.01) -- 11.76 13.62
11/30/98 11.76 0.04 0.52 0.56 -- -- 12.32 4.76
1/31/99# 12.32 -- 3.20 3.20 -- -- 15.52 25.97
1/31/00 15.52 -- 8.59 8.59 (0.03) (1.36) 22.72 60.62
International Growth and Income Portfolio
6/2/97-
11/30/97 10.00 0.03 0.38 0.41 -- -- 10.41 4.10
11/30/98 10.41 0.13 0.86 0.99 (0.03) (0.06) 11.31 9.58
1/31/99# 11.31 -- 0.40 0.40 (0.02) (0.19) 11.50 3.56
1/31/00 11.50 0.15 1.97 2.12 (0.45) (0.89) 12.28 17.99
<CAPTION>
NET RATIO OF NET
ASSETS RATIO OF INVESTMENT
END OF EXPENSES TO INCOME TO
PERIOD PERIOD AVERAGE NET AVERAGE PORTFOLIO
ENDED (000'S) ASSETS NET ASSETS TURNOVER
---------- ---------------------------------------------------
<S> <C> <C> <C> <C>
11/30/95 $ 167,870 0.79% 0.51% 138%
11/30/96 381,367 0.71 0.51 121
11/30/97 704,533 0.65 0.37 110
11/30/98 1,396,140 0.58 0.27 90
1/31/99# 1,864,924 0.63+ (0.01)+ 11
1/31/00 2,875,413 0.63 (0.11) 77
6/3/96-
11/30/96 35,124 1.05+++ 0.46+++ 47
11/30/97 103,603 0.90 (0.13) 221
11/30/98 133,183 0.83 0.32 268
1/31/99# 182,313 0.82+ 0.13+ 29
1/31/00 450,073 0.75 0.02 131
6/2/97-
11/30/97 42,844 1.60+++ 0.61+++ 19
11/30/98 128,344 1.46 1.12 51
1/31/99# 142,497 1.46+ (0.10) 10
1/31/00 253,962 1.21 1.16 75
</TABLE>
---------------
* Calculated based upon average shares outstanding
** After fee waivers and expense reimbursements by the investment adviser
*** Does not reflect expenses that apply to the separate accounts of the
insurance companies. If such expenses had been included, total return
would have been lower for each period presented.
# The Portfolio changed its fiscal year ended from November 30 to January
31.
+ Annualized
++ During the below stated periods, 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>
<CAPTION>
EXPENSES NET INVESTMENT INCOME (LOSS)
--------------------------------------------- ---------------------------------------------
11/95 11/96 11/97 11/98 1/99+ 1/00 11/95 11/96 11/97 11/98 1/99+ 1/00
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
--------------------------------------------- ---------------------------------------------
Alliance Growth....... 0.79% 0.71% 0.65% 0.58% 0.63% 0.63% 0.51% 0.51% 0.37% 0.27% (0.01)% (0.11)%
Aggressive Growth..... -- 1.09 0.90 0.83 0.82 0.75 -- 0.42 (0.13) 0.32 0.13 0.02
International Growth
and Income............ -- -- 2.02 1.46 1.46 1.21 -- -- 0.19 1.12 (0.10) 1.16
</TABLE>
24
<PAGE> 29
--------------------------------------------------------------------------------
FOR MORE INFORMATION
--------------------------------------------------------------------------------
The following documents contain more information about the Portfolios and are
available free of charge upon request:
ANNUAL/SEMI-ANNUAL REPORTS. Contain financial statements, performance
data and information on portfolio holdings. The annual report also
contains a written analysis of market conditions and investment
strategies that significantly affected a Portfolio's performance for the
most recently completed fiscal year.
STATEMENT OF ADDITIONAL INFORMATION (SAI). Contains additional
information about the Portfolios' policies, investment restrictions and
business structure. This prospectus incorporates the SAI by reference.
You may obtain copies of these documents or ask questions about the Portfolios
at no charge by calling (800) 445-7862 or by writing the Trust at P.O. Box
54299, Los Angeles, California 90054-0299.
Information about the Portfolios (including the SAI) can be reviewed and copied
at the Public Reference Room of the Securities and Exchange Commission,
Washington, D.C. Call (800) SEC-0330 for information on the operation of the
Public Reference Room. Information about the Portfolios is also available on the
Securities and Exchange Commission's web-site at http://www.sec.gov and copies
may be obtained upon payment of a duplicating fee by electronic request at the
following e-mail address: [email protected], or by writing the Public Reference
Section of the Securities and Exchange Commission, Washington, D.C. 20549-6009.
You should rely only on the information contained in this prospectus. No one is
authorized to provide you with any different information.
INVESTMENT COMPANY ACT
- File No. 811-7238
25
