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U.S. GLOBAL ACCOLADE FUNDS
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SEMI-ANNUAL REPORT
APRIL 30, 2000
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U.S. GLOBAL ACCOLADE FUNDS
SEMI-ANNUAL REPORT
(UNAUDITED)
APRIL 30, 2000
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TABLE OF CONTENTS
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LETTER TO SHAREHOLDERS 1
FUND MANAGER'S PERSPECTIVE 7
PORTFOLIOS OF INVESTMENTS 20
STATEMENTS OF ASSETS AND LIABILITIES 32
STATEMENTS OF OPERATIONS 33
STATEMENTS OF CHANGES IN NET ASSETS 34
NOTES TO FINANCIAL STATEMENTS 36
FINANCIAL HIGHLIGHTS 42
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[U.S. Global Investors Logo]
P.O. Box 781234
San Antonio, Texas 78278-1234
Tel 1*800*US*FUNDS
Fax 210*308*1217
www.usfunds.com
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Dear Shareholder:
The Year 2000--you can't say it hasn't been an [Graphic: Photograph
interesting year so far for investors. of Frank E. Holmes]
In this U.S. presidential election year, the
economy continues to turn out record earnings.
Periodic interest rate increases by the Federal
Reserve Bank have succeeded in making some
investors jittery. However, Fed Chairman Alan
Greenspan's best intentions of slowing down the economy have yet to impose
significant cutbacks in employment, labor costs, production, or borrowing and
spending.
We wrote in our Shareholder Report (4th Quarter 1999) that we expected the
market to remain bullish "with one or two healthy corrections." We weathered one
such correction on April 14, emerging confident in the knowledge that the
diversification offered by mutual fund investing remains the prudent way to
protect your assets and navigate a volatile market. While the Dow Jones and
Nasdaq were both off by record amounts for the day, mutual fund investors stayed
calm.
As long as earnings remain robust, and businesses continue to reinvent
themselves--examining everything from the technologies used to the global
interaction between companies and countries--we remain bullish on investing in
the U.S. and abroad with good reason.
The U.S. presidential election market cycle theory is one of the many
macroeconomic analytical tools we use in our market forecasting. This theory
holds that there is a strong correlation between the actual election year (2000)
and an "up" year for the stock market, as was the third year in the cycle
(1999). The theory, which reaches back through history to the 1832 presidential
election for its data, also holds that years one and two immediately following a
presidential election reflect weaker market returns.
Currently, the economy is humming along, while long-term interest rates hover
around 6.3 percent despite continued rate increases. However, if interest rates
continue to rise through the end of the summer, we could see a down year. We
believe interest rates could peak in July or August.
That is why we advocate the dollar-cost averaging method of investing, using our
ABC Investment Plan(R) to accumulate new shares while the market is
correcting. (1)
The following chart demonstrates the effect of dollar-cost averaging for a
typical mutual fund investment cycle of five years. A hypothetical investment of
$1,200 per year for five years yields an average share price of $35.26, which
falls between the low of $30 and the high of $40 per share. This eliminates the
guess work involved in market timing. It also assures that you have a position
in the market at all times.
1
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<TABLE>
DOLLAR-COST AVERAGING LEADS TO
POTENTIAL LOWER OVERALL SHARE PRICES
<CAPTION>
INVESTMENT AMOUNT ANNUAL SHARES
YEAR INVESTED SHARE PRICE PURCHASED
<S> <C> <C> <C>
1 $1,200 $30.00 40.00
2 1,200 35.00 34.29
3 1,200 40.00 30.00
4 1,200 35.00 34.29
5 1,200 38.00 31.58
------ ------
Total $6,000 170.16
</TABLE>
Average share price = $35.26
This table is for illustrative purposes only and does not depict actual fund
performance. Actual results will vary.
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BONNEL GROWTH FUND AWARDED MORNINGSTAR'S HIGHEST RATING
In December 1999, Morningstar awarded the Bonnel Growth Fund five stars for
risk-adjusted performance. Currently the fund has 5 stars out of 3,571, 3,571,
and 2,283 domestic equity funds for the overall, 3- and 5-year periods ended
3/31/00, respectively. (2)
The Wall Street Journal awarded the Bonnel Growth Fund an "A" rating for the 1-,
3-, and 5-year periods ended 3/31/00, based on average annual total return among
372, 257, and 158 multi-cap growth funds reported by Lipper, Inc.,
respectively. (3)
The Bonnel Growth Fund recorded its fifth anniversary in October 1999 and
continues its emphasis on stocks with market capitalizations of less than $10
billion at the time of purchase. The fund's manager, Art Bonnel, uses a
fundamental, quantitative analysis of financial data based on measures he
believes predict future growth potential.
MEGATRENDS FUND'S VALUE STOCK ORIENTATION PROVES DURABLE
The fund's conservative portfolio manager, Dr. Stephen Leeb of the Money Growth
Institute, continues to favor beneficiaries of strong and somewhat inflationary
economic growth. This unique approach to value-oriented investing encompasses a
broad range of stocks, from oil and gas drilling to telephone communications and
holding companies.
2
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Going forward, the fund remains bullish on old economy providers of new economy
services. You won't find new economy tech stocks in this portfolio, because Leeb
believes that the higher the price-to- earnings ratio, the bigger the potential
fall a company will take.
We expect that the fund's value stock orientation may serve it well in the
second half of the year. Old economy blue chips held their own, even as new
economy tech-related stocks lost considerable ground in March and April.
We suggest that the MegaTrends Fund be a part of an asset allocation model for
conservative investors who prefer low volatility and old economy companies.
REGENT EASTERN EUROPEAN FUND PRIMED FOR EXPANSION
The ongoing political stabilization process in Eastern Europe continues to have
a favorable effect on the economic climate in markets like Poland, the Czech
Republic, Hungary, Russia, Slovakia and others. Broad privatization has put
thousands of companies once owned by the state in the hands of private
investors, who now have a direct stake in the financial success of these
companies.
The best performing market in the region has been Russia, buoyed by very
positive macroeconomic conditions and a stable political environment. Corporate
profits have risen sharply, while Russia's cost of capital on international
credit markets has declined.
The other equity markets in the region have also performed well, with Polish and
Hungarian telecommunication and technology companies being especially well
supported. Growth prospects across the core markets of the fund appear good.
Poland and Hungary, in particular, have one eye firmly fixed on European Union
enlargement, and the convergence process has already begun in earnest. My own
impressions of the region, gathered during a recent visit to Poland, led me to
conclude that this is an exciting and vibrant area with much to offer the
business world.
DIVERSIFICATION IS THE BEST WAY TO REACH YOUR FINANCIAL GOALS
It appears that the market is somewhat cautionary regarding inflation, although
the May interest rate increase of .5 percent seemed to have little immediate
effect on key market activity. However, speculation continues concerning the
possibility of additional rate hikes throughout the year. Add to this the
disruptions caused by new technologies imposed on old business methods, and you
have a very volatile market.
3
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We expect market adjustments to continue over the next few months leading up to
the U.S. presidential election in November. Experienced investors know that
these adjustments should provide great opportunities to invest in leading,
growing companies.
Asset allocation is planned diversification of your hard-earned savings into
multiple investment vehicles. By spreading around your investments, you take
advantage of being invested at all times in favorable sectors as they shift. To
assist you in gauging the right asset allocation for your age, risk sensitivity,
investment expectations and financial goals, visit our online asset allocation
system at www.usfunds.com. An accompanying life cycle investing chart can give
you a very broad idea of investment allocation by age.
THE POWER OF DISCIPLINED INVESTING
Disciplined investing will make the difference in the growth of your assets,
just as disciplined training makes the difference between world-class athletes
and amateurs. To strengthen your approach and opportunities to benefit from
favorable market conditions, we suggest the affordable convenience offered by
our ABC Investment Plan(R).
As enticing as double and even triple-digit returns can be, chasing hot sectors
is dangerous. That's why we continue to advocate a disciplined approach to
investing by diversifying your investments into different asset classes and
building your equity by investing regularly. It is impossible to accurately and
consistently guess the peak in interest rates, the bottom of the stock market,
or the revenue of a company. As the following table shows, only three times in
the last 20 years did the top-performing sector repeat as the top sector in the
following year. However, it is possible to navigate through this uncertainty by
using the ABC Investment Plan(R) and diversifying your investment classes.
4
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<TABLE>
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HOT & COLD SECTORS
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Top-performing stock sectors in recent years
<CAPTION>
TOP-RANKED SECTOR SECTOR S&P 500 RANK IN NEXT YEAR
YEAR FOR PERFORMANCE RETURN RETURN (AMONG 7 SECTORS)
<S> <C> <C> <C> <C>
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1980 Natural Resources 56.09% 32.22% 5
1981 Utility 20.94 -5.08 3
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1982 Health 45.34 21.46 6
1983 Technology 34.18 22.47 3
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1984 Communications 22.58 6.27 3
1985 Health 39.91 31.74 4
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1986 Utility 24.41 18.68 5
1987 Natural Resources 11.57 5.26 6
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1988 Communications 22.90 16.61 1
1989 Communications 46.67 31.68 5
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1990 Health 15.02 -3.12 1
1991 Health 63.79 30.48 7
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1992 Financials 34.97 7.62 5
1993 Natural Resources 26.31 10.06 4
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1994 Technology 13.18 1.32 2
1995 Health 45.06 37.53 5
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1996 Natural Resources 33.73 22.95 7
1997 Financials 45.77 33.35 5
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1998 Technology 52.63 28.58 1
1999 Technology 135.59 21.04 6 (*)
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2000 (*) Health 8.34 -7.35 NA
Source: Morningstar Inc. (*)Through April 14
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</TABLE>
The ABC Investment Plan(R) is designed to allow you to contribute a set amount
regularly to the fund(s) of your choice. Taking advantage of this dollar-cost
averaging method of investing takes the guesswork out of timing the market.
Because you invest the same amount on a regular basis, your contributions buy
more shares when the price is low and fewer shares when the price is high. (1)
TAKE A LONG-TERM APPROACH TO REACHING YOUR FINANCIAL GOALS
Long-term investing involves understanding that significant accumulation of
wealth does not happen overnight for most people. Mutual funds provide a way for
investors to participate in the long-range growth of companies throughout the
business cycle, from start-up companies to successful ongoing enterprises. We
suggest you carefully consider your future financial needs and goals before
investing in a particular type of fund or funds. The most successful mutual fund
investors have found that taking a long-term position in a fund serves them
better than short-term trading.
5
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WORKPLACE SAVINGS PARTICIPATION A "NO-BRAINER"
If your employer wants to encourage you to save and prepare for your financial
future, by all means, take advantage of the offer. Max out any 401(k), 403(b),
IRA, or other employer matching options annually. Otherwise, you are simply
leaving money on the table each year, when it could be invested and working for
you.
In conclusion, we suggest that you focus on a disciplined investing strategy
using the ABC Investment Plan,(R) asset allocation, long-term thinking and the
power of employer matching contributions for any and all workplace savings
programs. You'll thank yourself when you reach retirement and find that your
disciplined investing has paid off.
To get more information about any of our funds, including charges and ongoing
expenses, please call 1-800-US-FUNDS to request a prospectus by mail or download
a prospectus from our website, www.usfunds.com. Please read the prospectus
carefully before you invest or send money.
Sincerely,
/s/ Frank Holmes
Frank Holmes
Chairman & CEO
(1)
Of course, a program of regular investing doesn't assure a profit or protect
against loss in a declining market. You should evaluate your ability to
continue in such a program in view of the possibility that you may have to
redeem fund shares in periods of declining share prices as well as in
periods of rising prices.
(2)
Morningstar proprietary ratings reflect risk-adjusted performance and are
subject to change every month. Overall ratings are calculated from a fund's
3-, 5- and 10-year (when available) average annual returns in excess of
90-day T-bill returns with appropriate fee adjustments and a risk factor
that reflects fund performance below 90-day T-bill returns. The top 10% of
the funds in an investment category receive 5 stars.
(3)
In the Wall Street Journal's 4/10/00 issue, an "A" rating reflected that the
fund was in the top 20 percent of the multi-cap growth funds reported by
Lipper, Inc. Lipper defines a multi-cap growth fund as one that invests in
companies of various sizes, with long-term earnings that are expected to
grow significantly faster than the earnings of stocks in major indexes.
Funds normally have above-average price-to-earnings ratios, price-to-book
ratios, and three-year earnings growth.
6
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BONNEL GROWTH FUND
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FUND MANAGER'S PERSPECTIVE
A Message from Art Bonnel
INTRODUCTION
The Bonnel Growth Fund can invest in companies of all sizes; however, it
currently focuses on mid-cap growth issues in four major sectors: financial
services, healthcare, technology and retailing. Currently, more growth is found
in these industries than in most others. Our primary objective is long-term
capital appreciation.
PERFORMANCE
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BONNEL GROWTH FUND
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[Linear graph plotted from data points shown in the following table.]
BONNEL S&P RUSSELL S&P MID-CAP
GROWTH FUND 500 INDEX 2000 INDEX 400 INDEX
----------- ----------- ----------- -----------
10/17/1994 $ 10,000.00 $ 10,000.00 $ 10,000.00 $ 10,000.00
10/31/1994 9,990.02 10,087.64 10,008.08 10,121.22
11/30/1994 10,009.98 9,720.72 9,603.89 9,665.05
12/30/1994 10,069.86 9,864.72 9,861.92 9,753.44
1/31/1995 9,839.63 10,120.37 9,737.49 9,855.38
2/28/1995 10,470.25 10,514.39 10,142.56 10,371.73
3/31/1995 10,920.69 10,824.15 10,317.24 10,551.43
4/28/1995 11,401.16 11,142.64 10,546.65 10,763.08
5/31/1995 11,571.33 11,587.32 10,727.99 11,022.51
6/30/1995 12,652.39 11,855.99 11,284.51 11,471.01
7/31/1995 14,093.80 12,248.99 11,934.56 12,069.18
8/31/1995 14,223.93 12,279.56 12,181.45 12,292.03
9/29/1995 14,844.54 12,797.49 12,398.95 12,590.02
10/31/1995 14,494.19 12,751.77 11,844.44 12,266.14
11/30/1995 14,774.47 13,310.92 12,342.04 12,801.43
12/29/1995 14,623.77 13,567.32 12,667.72 12,769.41
1/31/1996 14,414.11 14,028.55 12,654.14 12,954.23
2/29/1996 15,001.16 14,159.06 13,048.50 13,394.39
3/29/1996 15,703.52 14,295.38 13,314.12 13,554.81
4/30/1996 17,569.49 14,505.95 14,026.00 13,968.39
5/31/1996 19,047.60 14,879.41 14,578.77 14,157.12
6/28/1996 17,517.08 14,936.14 13,980.12 13,944.84
7/31/1996 15,703.52 14,276.63 12,759.01 13,001.67
8/30/1996 16,531.68 14,578.22 13,499.84 13,751.31
9/30/1996 17,978.33 15,397.99 14,027.42 14,350.40
10/31/1996 17,873.50 15,822.51 13,811.23 14,392.16
11/29/1996 18,708.98 17,017.45 14,380.29 15,202.51
12/31/1996 18,708.98 16,680.35 14,757.16 15,219.17
1/31/1997 18,846.54 17,721.89 15,052.08 15,790.29
2/28/1997 17,185.17 17,861.03 14,687.12 15,660.69
3/31/1997 16,285.70 17,128.51 13,994.10 14,994.00
4/30/1997 16,560.83 18,150.16 14,033.10 15,382.60
5/30/1997 18,349.19 19,254.38 15,594.28 16,726.86
6/30/1997 19,513.21 20,116.50 16,262.62 17,196.62
7/31/1997 21,343.90 21,716.24 17,019.34 18,898.53
8/29/1997 21,671.94 20,500.57 17,408.73 18,875.52
9/30/1997 23,132.26 21,622.68 18,682.98 19,960.01
10/31/1997 20,835.96 20,901.36 17,862.23 19,092.24
11/28/1997 20,831.79 21,868.13 17,746.70 19,375.11
12/31/1997 20,638.78 22,243.42 18,057.32 20,126.65
1/30/1998 20,780.32 22,489.20 17,772.35 19,743.40
2/27/1998 22,337.24 24,110.28 19,086.48 21,378.54
3/31/1998 23,276.53 25,343.94 19,873.66 22,342.29
4/30/1998 23,509.21 25,598.79 19,983.63 22,749.90
5/29/1998 22,250.72 25,159.39 18,907.36 21,727.10
6/30/1998 23,846.54 26,180.61 18,947.15 21,863.35
7/31/1998 23,171.89 25,902.53 17,413.30 21,016.64
8/31/1998 19,668.86 22,161.41 14,031.99 17,107.63
9/30/1998 21,173.86 23,581.16 15,130.10 18,704.34
10/30/1998 20,992.22 25,497.57 15,747.16 20,373.86
11/30/1998 22,964.30 27,042.29 16,572.20 21,390.63
12/31/1998 26,240.72 28,599.58 17,597.71 23,973.07
1/29/1999 28,118.89 29,795.07 17,831.57 23,040.15
2/26/1999 25,489.45 28,869.20 16,387.31 21,834.19
3/31/1999 27,770.08 30,023.92 16,643.14 22,444.14
4/30/1999 27,609.10 31,186.58 18,134.49 24,213.62
5/31/1999 27,367.62 30,451.19 18,399.38 24,318.79
6/30/1999 29,889.73 32,139.80 19,231.39 25,620.15
7/30/1999 29,460.44 31,137.74 18,703.70 25,076.21
8/31/1999 30,641.00 30,983.58 18,011.49 24,216.89
9/30/1999 31,204.45 30,135.25 18,015.43 23,470.20
10/29/1999 33,766.81 32,041.41 18,088.39 24,665.32
11/30/1999 37,630.47 32,692.71 19,168.44 25,959.82
12/31/1999 47,612.64 34,617.04 21,338.30 27,501.37
1/31/2000 48,354.65 32,878.00 20,995.64 26,727.29
2/29/2000 64,586.23 32,256.29 24,462.77 28,596.70
3/31/2000 61,324.46 35,409.85 22,849.92 30,988.76
4/28/2000 54,940.04 34,344.89 21,474.93 29,906.21
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AVERAGE ANNUAL PERFORMANCE For the Periods Ended
April 30, 2000
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<CAPTION>
Inception Five Year One Year Six Month
<S> <C> <C> <C> <C>
Bonnel Growth Fund
(Inception 10/17/94) 36.05% 36.96% 98.99% 62.70%
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S&P 500 Index 24.98% 25.25% 10.13% 7.19%
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S&P Mid-Cap 400 Index 21.89% 22.68% 23.51% 21.25%
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Russell 2000 Index 14.81% 15.28% 18.42% 18.72%
Past performance is not predictive of future results. Investment
return and principal value may fluctuate so that shares, when
redeemed, may be worth more or less than their original value. The S&P
500 Index is an unmanaged but commonly used measure of common stock
total return performance. The S&P Mid-Cap 400 Index is a
capitalization-weighted index that measures the performance of the
mid-range sector of the U.S. stock market. The Russell 2000 Index is
an unmanaged index that consists of 2,000 small- and mid-cap publicly
traded companies.
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</TABLE>
7
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SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED THE FUND
This past six months has been very exciting. Y2K, the biggest and most important
event of the century, came and went with no noticeable impact. Now the
doomsayers are saying they are sorry that they scared you. Inflation was also a
concern, resulting in the Federal Reserve increasing interest rates three times
in the past six months.
The stock market created its own excitement. The Dow Jones Industrials went over
11,700 on January 14, 2000, and the Nasdaq Composite surpassed 5,000 on March 9.
Then, on April 14, the market suffered one of the sharpest declines in its
history. In five weeks the Nasdaq dropped over 34 percent. From its January 14
high of 11,723, the Dow dropped over 15 percent. This plunge gave the doomsayers
something else to worry about. Interest rates responded and the long bond rate
went back over 6%.
There are always new developments taking place that will impact investment
decisions. Advancements in technology and biotechnology are some that come to
mind. That is what makes investing in the stock market so exciting. The real
secret is to recognize the direction of the trend and not pick short-term market
swings. Although the market and individual issues have moved dramatically both
up and down, we continue to believe that the stock market has a great deal of
upside potential.
INVESTMENT HIGHLIGHTS
The fund has maintained diversity while looking for quality growth issues. Liz
Claiborne, which the fund has held since July 1999, designs and markets an
extensive range of high quality fashion apparel and accessories for both men and
women. Experiencing annual growth of 13%, the company's apparel and fragrances
are sold worldwide through department and specialty stores.
Another retailer we hold is Walgreens Co. It is the largest U.S. retail drug
chain in terms of revenues, operating more than 2,800 drug stores in 39 states
and Puerto Rico. Although founded in 1909, the company became more widely known
in the 1920s, when people lined up to buy milkshakes - a product invented by
Walgreens' founder, Charles Walgreen, Sr.
8
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Certainly, technology and e-business stocks made headlines in the past six
months. As you know, we look for quality investments where the companies are
showing profits and have great financial positions. At the present time, most
e-commerce companies are not making money. For that reason we do not own them.
However, within the next few years, the quality companies will start to show a
profit, and at that time you will see them in the portfolio.
The fund is indirectly involved in this burgeoning industry because of our
investments in technology. Cisco Systems, Sun Microsystems and a plethora of
other issues are supplying and/or making parts for this industry. We also hold
shares in Lucent, the world's leading designer, developer and manufacturer of
telecommunications systems, software and products.
The fund has also purchased some issues in the financial services industry, with
one company being Charles Schwab. It provides securities brokerage and other
related financial services to millions of people nationwide. It is a leading
U.S. discount brokerage, executing an average of over 130,000 trades a day in
1998. It is also one of the financial services industry's leading innovators. It
was the first to open a mutual fund supermarket, called Mutual Fund OneSource.
In the healthcare industry, one of our favorite issues is Johnson & Johnson.
Well known for household names like Tylenol and Band-Aid adhesive bandages,
Johnson & Johnson currently ranks as the largest and most diversified healthcare
company in the world.
CURRENT OUTLOOK
The U.S. economy is in great shape. We are leading the world into this century.
Our technology and energy will shape the world for many years to come. The
electronic revolution will change the way we all live for the better. It is
exciting to be part of it.
The big question now is, has the market hit bottom? Only time will tell. No one
can know the answer for sure, but the market acts like it wants to continue to
climb much higher. However, as we witnessed in April, the market is not a
one-way street. There are always those corrections, but they can be great buying
opportunities for the astute and patient investor.
9
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TOP 10 HOLDINGS BASED ON TOTAL INVESTMENTS
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CISCO SYSTEMS, INC. 3.21%
COMPUTERS & DATA PROCESSING
--------------------------------------------------------------
ADOBE SYSTEMS, INC. 2.50%
COMPUTER SOFTWARE & HARDWARE
--------------------------------------------------------------
VISHAY INTERTECHNOLOGY, INC. 2.09%
ELECTRONICS & COMPONENTS
--------------------------------------------------------------
SUN MICROSYSTEMS, INC. 1.83%
COMPUTERS & DATA PROCESSING
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APPLIED MATERIALS, INC. 1.81%
SEMICONDUCTORS
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IN FOCUS SYSTEMS, INC. 1.81%
COMPUTERS & DATA PROCESSING
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AVX CORP. 1.74%
ELECTRONICS & COMPONENTS
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CITIGROUP, INC. 1.69%
FINANCIAL SERVICES
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GENERAL ELECTRIC CO. 1.68%
MANUFACTURING
--------------------------------------------------------------
SCIENTIFIC ATLANTA, INC. 1.62%
COMMUNICATIONS EQUIPMENT
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TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS
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ELECTRONICS & COMPONENTS 21.60%
COMPUTERS & DATA PROCESSING 9.56%
SEMICONDUCTORS 7.97%
COMPUTER SOFTWARE & HARDWARE 7.90%
FINANCIAL SERVICES 5.70%
10
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MEGATRENDS FUND
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FUND MANAGER'S PERSPECTIVE
A Message from Dr. Stephen Leeb
INTRODUCTION
The goal of the MegaTrends Fund is long-term capital appreciation consistent
with capital preservation. The fund diversifies its holdings among industries
and asset classes that reflect the manager's view of the major trends affecting
the world's economy. Because the fund is flexible, it may invest any portion of
its assets in the following three asset classes: stocks, bonds or money market
instruments. Unless the manager believes a major recession is likely, the fund
will invest primarily in stocks to pursue growth potential. Thus, the key
decision is which industries are most leveraged to broad economic themes.
PERFORMANCE
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MEGATRENDS FUND
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[Linear graph plotted from data points shown in the following table.]
LIPPER
FLEXIBLE
MEGATRENDS S&P 500 PORTFOLIO
DATE FUND INDEX FUND INDEX
---------- --------- --------- ---------
10/21/1991 $10,000.00 $10,000.00
10/31/1991 9,990.00 10,134.93 $10,000.00
11/29/1991 9,880.00 9,727.68 9,784.60
12/31/1991 10,423.30 10,838.32 10,624.72
1/31/1992 10,373.14 10,636.60 10,567.45
2/28/1992 10,503.56 10,774.29 10,683.28
3/31/1992 10,413.27 10,564.99 10,455.52
4/30/1992 10,503.56 10,874.86 10,478.30
5/29/1992 10,533.65 10,928.04 10,605.84
6/30/1992 10,550.31 10,765.52 10,495.22
7/31/1992 10,723.42 11,204.96 10,809.53
8/31/1992 10,703.06 10,976.06 10,704.76
9/30/1992 10,845.63 11,105.08 10,831.00
10/30/1992 10,947.47 11,143.20 10,831.65
11/30/1992 11,039.12 11,521.58 11,070.48
12/31/1992 11,071.08 11,662.94 11,226.65
1/29/1993 11,122.43 11,760.34 11,414.72
2/26/1993 11,142.97 11,920.57 11,442.05
3/31/1993 11,214.86 12,171.92 11,682.83
4/30/1993 11,112.16 11,877.72 11,563.09
5/31/1993 11,204.59 12,194.67 11,797.36
6/30/1993 11,266.21 12,230.26 11,887.81
7/30/1993 11,266.21 12,181.02 11,932.71
8/31/1993 11,390.93 12,642.18 12,338.78
9/30/1993 11,401.33 12,545.23 12,384.98
10/29/1993 11,370.15 12,804.57 12,564.59
11/30/1993 11,266.21 12,682.52 12,390.84
12/31/1993 11,388.75 12,835.86 12,655.69
1/31/1994 11,675.33 13,271.83 13,000.59
2/28/1994 11,473.66 12,911.93 12,716.21
3/31/1994 11,378.14 12,350.08 12,206.68
4/29/1994 11,208.31 12,508.31 12,254.83
5/31/1994 11,325.07 12,712.78 12,297.78
6/30/1994 11,096.87 12,401.68 12,039.44
7/29/1994 11,183.14 12,808.63 12,325.76
8/31/1994 11,323.33 13,332.56 12,675.21
9/30/1994 11,215.49 13,006.79 12,454.61
10/31/1994 11,247.85 13,298.59 12,544.41
11/30/1994 10,902.75 12,814.87 12,243.12
12/30/1994 11,037.55 13,004.71 12,317.30
1/31/1995 11,114.51 13,341.73 12,414.26
2/28/1995 11,444.32 13,861.17 12,775.43
3/31/1995 11,631.21 14,269.53 13,045.49
4/28/1995 11,895.05 14,689.40 13,290.17
5/31/1995 12,279.83 15,275.63 13,712.50
6/30/1995 12,450.23 15,629.82 13,994.27
7/31/1995 12,583.98 16,147.90 14,358.04
8/31/1995 12,617.42 16,188.21 14,479.73
9/29/1995 12,751.18 16,871.00 14,744.58
10/31/1995 12,795.76 16,810.72 14,635.91
11/30/1995 13,263.90 17,547.85 15,063.45
12/29/1995 13,710.52 17,885.87 15,223.53
1/31/1996 13,939.22 18,493.91 15,518.32
2/29/1996 13,984.96 18,665.96 15,599.01
3/29/1996 13,973.53 18,845.68 15,709.64
4/30/1996 14,293.71 19,123.27 15,945.86
5/31/1996 14,568.15 19,615.61 16,148.24
6/28/1996 14,579.35 19,690.39 16,123.51
7/31/1996 13,764.36 18,820.95 15,622.44
8/30/1996 14,165.39 19,218.55 15,892.50
9/30/1996 14,631.10 20,299.25 16,494.44
10/31/1996 15,355.54 20,858.90 16,792.48
11/29/1996 16,015.29 22,434.19 17,605.91
12/31/1996 15,821.25 21,989.79 17,370.34
1/31/1997 16,651.17 23,362.87 17,871.41
2/28/1997 16,308.66 23,546.28 17,846.03
3/31/1997 15,952.98 22,580.61 17,307.22
4/30/1997 16,203.28 23,927.45 17,761.44
5/30/1997 17,309.84 25,383.15 18,515.65
6/30/1997 17,745.88 26,519.68 19,060.97
7/31/1997 18,931.57 28,628.64 20,133.40
8/29/1997 18,312.38 27,026.01 19,500.88
9/30/1997 19,300.46 28,505.30 20,326.67
10/31/1997 18,286.03 27,554.37 19,899.13
11/28/1997 18,378.25 28,828.87 20,259.65
12/31/1997 18,287.35 29,323.61 20,539.47
1/30/1998 18,364.44 29,647.63 20,661.61
2/27/1998 19,382.12 31,784.71 21,663.17
3/31/1998 20,214.77 33,411.05 22,393.96
4/30/1998 20,538.57 33,747.02 22,534.46
5/29/1998 19,705.93 33,167.76 22,309.10
6/30/1998 19,736.77 34,514.03 22,739.31
7/31/1998 18,379.86 34,147.44 22,503.35
8/31/1998 15,666.06 29,215.51 20,293.62
9/30/1998 16,591.22 31,087.16 21,101.06
10/30/1998 17,500.96 33,613.58 22,101.13
11/30/1998 18,148.57 35,649.99 23,008.39
12/31/1998 18,703.98 37,702.97 23,931.15
1/29/1999 19,071.09 39,278.99 24,392.53
2/26/1999 18,373.59 38,058.42 23,720.31
3/31/1999 19,254.64 39,580.69 24,311.19
4/30/1999 19,878.72 41,113.44 25,025.05
5/31/1999 19,529.97 40,143.96 24,586.52
6/30/1999 20,282.53 42,370.07 25,302.86
7/30/1999 20,209.11 41,049.05 24,853.84
8/31/1999 20,300.89 40,845.82 24,627.25
9/30/1999 19,456.55 39,727.46 24,359.93
10/29/1999 19,750.23 42,240.36 25,000.98
11/30/1999 20,154.04 43,098.97 25,272.60
12/31/1999 21,927.91 45,635.83 26,282.94
1/31/2000 20,831.52 43,343.25 25,543.37
2/29/2000 21,014.25 42,523.63 25,767.16
3/31/2000 23,511.60 46,680.98 26,932.13
4/28/2000 23,430.38 45,277.05 26,384.98
--------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
April 30, 2000
--------------------------------------------------------------------------
<CAPTION>
INCEPTION FIVE YEAR ONE YEAR SIX MONTH
<S> <C> <C> <C> <C>
MegaTrends Fund
(Inception 10/21/91) 10.50% 14.52% 17.87% 18.63%
----------------------------------------------------------------------
S&P 500 Index 19.39% 25.25% 10.13% 7.19%
----------------------------------------------------------------------
Lipper Flexible Portfolio
Fund Index 12.08% 14.70% 5.43% 5.54%
Past performance is not predictive of future results. Investment
return and principal value may fluctuate so that shares, when
redeemed, may be worth more or less than their original value. The
Lipper Flexible Portfolio Fund Index allocates investments across
various asset classes, including domestic common stocks, bonds, and
money market instruments with a focus on total returns.
--------------------------------------------------------------------------
</TABLE>
11
<PAGE>
--------------------------------------------------------------------
MEGATRENDS FUND
--------------------------------------------------------------------
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED THE FUND
The past six months have been some of the wildest on record. If you define bull
and bear markets as 20 percent changes in major market averages, then the new
economy tech stocks experienced both a bull market and a bear market in just
three months. Financial stocks, which had been among the leaders of the great
bull market of the 1990s, experienced a bear market before regaining some ground
at the end of the period. These violent swings were not random. They almost
certainly portend changes in both the economy and in the investment environment.
The break in tech stocks and virtually all stocks with high price-to-earnings
ratios (P/Es) appears to indicate slower economic growth and somewhat higher
inflation. Growth is slowing because the Federal Reserve is raising interest
rates. Commodity prices are likely to continue upward because growth in major
economies from Asia to Europe is accelerating, notwithstanding the recent slight
reprieve in oil prices. China's consumer prices, which had declined over five
years, are now rising. That is strong evidence that this massive
commodity-consuming economy has entered a long-term phase of self-sustaining
growth.
For some stocks, lower growth and rising inflation are a double whammy. Slightly
lower U.S. growth will likely trim earnings projections, while higher inflation
makes longer-term projections less certain and thus lowers P/E ratios. The
silver lining to the fall in the Nasdaq is that both the economy and the market
are now on firmer footing. The ultra-high P/E's in the tech and Internet stocks
were based on unrealistic expectations that in turn created fantasy, wealth,
excess spending and an unhealthy build-up of debt. The shake out in Nasdaq has
engendered a more solid economic and investing environment-reason enough for
financials, one of the most sensitive barometers of economic risk, to rally.
INVESTMENT HIGHLIGHTS
We welcome the decline in the speculative part of the market as evidence of a
return to reason. In no way does it alter our fundamental investment philosophy.
Our basic tenet remains growth at a reasonable price. This means every one of
the stocks held in the fund not only has well-defined growth prospects and
excellent management but also, relative to its projected growth, is valued at
less than the S&P 500. Also of great importance, the portfolio is diversified so
as to cover most economic sectors
12
<PAGE>
--------------------------------------------------------------------
MEGATRENDS FUND
--------------------------------------------------------------------
characterized by long-term growth. These include technology, telecommunications,
healthcare, financial services, metal mining and those parts of the energy
sector that are not highly cyclical. Our investment discipline means that all
investments will be cheaper than the S&P 500 in terms of PEG, defined as
price-earnings ratio divided by projected growth rates.
CURRENT OUTLOOK
The two megatrends that we continue to focus on are energy and the environment.
Indeed we think over the next decade environmental and energy issues will assume
center stage. Platinum and related metals (PGMs) are the nexus of these trends.
PGMs are necessary catalysts in catalytic converters, which are used to remove
automotive pollutants. At the same time, PGMs are vital ingredients in fuel
cells, which will likely play a major role in our transformation from an economy
driven by fossil fuel to one driven by cleaner and much more abundant hydrogen.
As a result, the fund currently has three PGM holdings and is actively looking
for other PGM investments. Because PGM stocks tend to be volatile and very
cyclical, we don't intend to invest a significant portion of our assets in this
sector.
Perhaps our biggest challenge is to find tech stocks that satisfy our criteria.
Fortunately, there has been such divergence between stocks perceived as "old"
economy and those perceived as "new" that old economy tech stocks such as
Honeywell remain relatively cheap. Equally fortunate is that telephone service
companies like MCI WorldCom and ALLTEL offer an inexpensive way of participating
in the burgeoning Internet and wireless markets.
Despite the market's volatility, we have had a good six months as we
outperformed the major averages and our peers. While volatility can be
unnerving, it does create buying opportunities, and we will continue to do our
best to take advantage of them.
13
<PAGE>
--------------------------------------------------------------------
MEGATRENDS FUND
--------------------------------------------------------------------
--------------------------------------------------------------------
TOP 10 HOLDINGS BASED ON TOTAL INVESTMENTS
--------------------------------------------------------------------
NOBLE DRILLING CORP. 5.31%
OIL & GAS EXTRACTION & SERVICES
--------------------------------------------------------------
MCI WORLDCOM, INC. 5.25%
TELECOMMUNICATIONS
--------------------------------------------------------------
ELAN CORP. PLC 5.20%
PHARMACEUTICALS
--------------------------------------------------------------
ACE LTD. 4.70%
INSURANCE
--------------------------------------------------------------
BURLINGTON RESOURCES, INC. 4.54%
OIL & GAS EXTRACTION & SERVICES
--------------------------------------------------------------
APEX SILVER MINES LTD. 4.23%
METAL MINING
--------------------------------------------------------------
NABORS INDUSTRIES, INC. 4.10%
OIL & GAS EXTRACTION & SERVICES
--------------------------------------------------------------
DUKE ENERGY CO. 3.99%
UTILITIES
--------------------------------------------------------------
TYCO INTERNATIONAL LTD. 3.72%
MANUFACTURING
--------------------------------------------------------------
ST. PAUL COMPANIES, INC. 3.60%
INSURANCE
--------------------------------------------------------------------
--------------------------------------------------------------------
TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS
--------------------------------------------------------------------
OIL & GAS EXTRACTION & SERVICES 13.95%
METAL MINING 9.88%
INSURANCE 8.31%
PHARMACEUTICALS 8.12%
TELECOMMUNICATIONS 7.18%
14
<PAGE>
--------------------------------------------------------------------
REGENT EASTERN EUROPEAN FUND
--------------------------------------------------------------------
FUND MANAGER'S PERSPECTIVE
A Message from Dominic Bokor-Ingram
INTRODUCTION
The investment objective of the Regent Eastern European Fund is to achieve
capital growth by investing in a diversified portfolio of Eastern European
securities. The fund currently focuses its investments in companies located in
Poland, the Czech Republic, Hungary, Russia, Croatia and the Slovak Republic.
PERFORMANCE
<TABLE>
-------------------------------------------------------------------------
REGENT EASTERN EUROPEAN FUND
-------------------------------------------------------------------------
[Linear graph plotted from data points shown in the following table.]
EMERGING
MARKETS --
EASTERN EASTERN
EUROPEAN S&P 500 EUROPEAN
DATE FUND INDEX INDEX
---------- ---------- ---------- ----------
3/27/1997 $10,000.00
3/31/1997 10,000.00 $10,000.00 $10,000.00
4/30/1997 10,360.00 10,596.46 10,083.67
5/30/1997 10,440.00 11,241.13 10,275.93
6/30/1997 11,190.00 11,744.45 11,255.04
7/31/1997 11,950.00 12,678.42 12,429.98
8/29/1997 11,750.00 11,968.68 12,215.76
9/30/1997 12,480.00 12,623.80 12,762.88
10/31/1997 11,190.00 12,202.67 11,279.37
11/28/1997 10,190.00 12,767.09 9,425.59
12/31/1997 11,237.00 12,986.19 10,782.70
1/30/1998 10,272.11 13,129.69 8,797.18
2/27/1998 11,166.64 14,076.11 10,327.56
3/31/1998 11,508.38 14,796.35 10,846.78
4/30/1998 11,860.16 14,945.14 11,022.43
5/29/1998 9,960.53 14,688.60 7,991.34
6/30/1998 9,819.81 15,284.81 7,622.83
7/31/1998 10,453.02 15,122.46 8,173.51
8/31/1998 7,447.78 12,938.32 4,724.66
9/30/1998 7,266.86 13,767.20 4,445.17
10/30/1998 8,060.89 14,886.04 5,179.80
11/30/1998 8,070.94 15,787.88 5,442.68
12/31/1998 8,392.57 16,697.06 5,568.48
1/29/1999 8,663.95 17,395.01 5,792.78
2/26/1999 7,890.02 16,854.47 5,046.88
3/31/1999 8,261.91 17,528.62 5,313.32
4/30/1999 8,925.27 18,207.41 5,796.34
5/31/1999 9,126.29 17,778.07 6,175.53
6/30/1999 9,679.10 18,763.92 6,659.74
7/30/1999 10,050.98 18,178.90 6,995.61
8/31/1999 9,809.76 18,088.89 6,692.38
9/30/1999 8,462.93 17,593.62 5,774.98
10/29/1999 8,704.15 18,706.48 5,961.90
11/30/1999 9,025.78 19,086.72 6,203.42
12/31/1999 10,885.22 20,210.19 7,354.62
1/31/2000 11,387.76 19,194.90 7,996.08
2/29/2000 11,940.57 18,831.93 8,781.75
3/31/2000 13,217.04 20,673.04 9,319.96
4/28/2000 11,427.97 20,051.30 8,199.03
-------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
April 30, 2000
-------------------------------------------------------------------------
<CAPTION>
INCEPTION ONE YEAR SIX MONTH
<S> <C> <C> <C>
Regent Eastern European Fund
(Inception 3/31/97) 4.41% 28.04% 31.29%
---------------------------------------------------------------------
S&P 500 Index 25.35% 10.13% 7.19%
---------------------------------------------------------------------
ING Barings Emerging Markets -
Eastern European Index (6.24)% 41.45% 37.52%
Past performance is not predictive of future results. Investment
return and principal value may fluctuate so that shares, when
redeemed, may be worth more or less than their original value. The ING
Barings Emerging Markets - Eastern European Index is comprised of
individual companies representative of the Eastern European markets.
-------------------------------------------------------------------------
</TABLE>
15
<PAGE>
--------------------------------------------------------------------
REGENT EASTERN EUROPEAN FUND
--------------------------------------------------------------------
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED THE FUND
The past six months were very positive for the fund, with net assets per share
growing to $11.37. Each of the fund's key markets has performed strongly,
especially Russia.
The case for investment in the region remains compelling. The macro- economic
situation has improved considerably, due in part to rising domestic consumption
and improved growth prospects across Western Europe. Recent European Central
Bank (ECB) estimates indicate an average growth rate of 3.1% across the European
Union (EU).
Hungary, Poland and the Czech Republic have become progressively more
synchronized with the European economy over the last few years. Given their
export profile, these countries essentially represent a leveraged way to obtain
exposure to the Western European economy.
As the convergence process accelerates, declining bond yields and equity risk
premiums will support increased equity market valuations. We have already seen
evidence of this process in Scandinavia and Southern Europe, and believe that it
is only a matter of time before we see a repeat of this in Central and Eastern
Europe (CEE.)
Governments across the region are firmly committed to implementing the
structural reform programs necessary for them to qualify for enlargement. The
key incentive is the 68 billion euros that have been allocated by the EU over
the next eight years to smooth the enlargement process. These free disbursements
are worth up to 2% of GDP for pre-accession countries and 4.5% for countries
actually accepted into the EU.
Growth prospects across the region are extremely encouraging. Poland has
averaged above 5% growth since 1995, with Hungary close behind. The Czech
Republic still has some work to do with regard to a structural adjustment
program, but its economy is likely to expand this year, after two years of
contraction.
Russia has surprised many market commentators with the speed of its recovery.
There are two reasons for the dramatic turnaround. Most significantly, the
Russian population is comfortable with the outlook for the Russian economy. This
has led to a substantial decline in capital flight. Russian support for the
domestic economy is seen as a prerequisite for
16
<PAGE>
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REGENT EASTERN EUROPEAN FUND
--------------------------------------------------------------------
sustained foreign investment, and recent evidence supports the conclusion that
there are considerable capital flows coming back into Russia. The second reason
is the positive impact that higher commodity prices are having on the economy.
The global enthusiasm for technology stocks has benefited the Polish market.
Over the last two years, a number of local software companies have listed on the
local exchange and have quickly increased their market value. After decades of
under-investment in technology, companies in the region are now firmly focused
on the need to upgrade their information technology infrastructure. Technology
spending, as a percentage of GDP, is still a third of the United States'
expenditures, but the market is growing at a rate above 15%. The fund has a
position in a local software house called ComArch. This company was recently
recognized at the Davos Political and Economic Forum as one of the world's top
100 most technologically advanced companies, along with companies such as
Microsoft and Cisco Systems.
The only cloud on the horizon is the persistently high current account deficit,
which totaled 7.5% of GDP last year. This has affected investor sentiment and,
in its own right, would be unsustainable. However, it is being financed by
surging foreign direct investments (FDI), which show no sign of easing. Given
the privatization plans of the government, continued FDI are expected to be
sufficient to cover the gap. Recent currency weakness will also help to improve
export performance. The recent float of the zloty will increase the inherent
risk of holding zloty-denominated assets, but it was an essential step toward
eradicating inflation from the economy.
Interest rates in Hungary have fallen by 300 basis points this year, providing
support for equity valuations. The economy is making good progress and is likely
to be among the candidates for the first wave of EU entry in 2004. It appears to
be the only CEE economy that is simultaneously achieving rapid growth, declining
inflation and an improving current account deficit. Sustained FDI in the years
since transition have led to foreign companies producing one-third of Hungarian
GDP.
The fund also has added to its exposure to Croatia. Over the last 12 months,
there has been a major positive change in the political environment. A new
president and a new government have pledged to rebuild the country's
relationships with other countries. Former President Tudjman's failure to
endorse the Dayton Peace Agreement effectively prevented the country from
seeking the external assistance it required to move the economy forward. The
change in senior personnel will allow Croatia to
17
<PAGE>
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REGENT EASTERN EUROPEAN FUND
--------------------------------------------------------------------
emerge from its period of isolation and facilitate a huge surge in investment
into the local economy.
INVESTMENT HIGHLIGHTS
Apart from Russia, the fund has benefited from overweighting in the
telecommunications sector. Deregulation across the region has not advanced,
meaning that the fixed-line incumbents have a firm competitive advantage.
Western European telecommunication companies have been aggressively competing
against one another to acquire the strategic stakes being sold via the
privatization process. Fixed-line penetration is relatively low, but is
increasing rapidly. Local companies are benefiting from the capital investment
and expertise their strategic investors are contributing. All companies are
targeting huge infrastructure build out programs, with a focus on value-added
products such as cellular and broadband. EBITDA margins are consistently higher
than their Western European peers, reflecting the more favorable competitive
environment.
The large companies in Russia readily acknowledge the importance of
international investors and have made progress toward improving financial
transparency and disclosure levels. A significant percentage of Russia's blue
chip companies have either adopted, or are in the process of implementing,
international accounting standards. The fund currently has about 30% of its
assets invested in the Russian market. It is these investments that have
generated the highest portfolio returns in the last six months. We expect to
maintain the existing country weighting, although we are not actively seeking to
increase it.
The improving macroeconomic picture across the region, combined with an
acceleration in the convergence process, provides the platform for positive
returns for the immediate future. The fund is well positioned to take advantage
of this growth.
CURRENT OUTLOOK
The dominant theme driving investment returns across the region in the next five
years will be the European Union enlargement process. Acceptance into the EU
will depend on the ability of the participating nations to meet the financial,
economic and social criteria established by Brussels.
18
<PAGE>
--------------------------------------------------------------------
REGENT EASTERN EUROPEAN FUND
--------------------------------------------------------------------
--------------------------------------------------------------------
TOP 10 HOLDINGS BASED ON TOTAL INVESTMENTS
--------------------------------------------------------------------
LUKOIL HOLDINGS 8.94%
OIL & GAS EXTRACTION
--------------------------------------------------------------
MOL MAGYAR OLAJ-ES GAZIPARI RT. 8.32%
OIL & GAS EXTRACTION
--------------------------------------------------------------
UNIFIED ENERGY SYSTEMS 8.15%
ELECTRIC SERVICES & UTILITIES
--------------------------------------------------------------
BORSODCHEM RT. 8.10%
CHEMICALS
--------------------------------------------------------------
ELEKTRIM SPOLKA AKCYJNA 7.58%
ELECTRIC SERVICES & UTILITIES
--------------------------------------------------------------
NORILSK NICKEL 7.16%
METAL MINING
--------------------------------------------------------------
ROSTELEKOM 6.39%
COMMUNICATIONS
--------------------------------------------------------------
MAGYAR TAVKOZLESI RT. 6.17%
COMMUNICATIONS
--------------------------------------------------------------
KGHM POLSKA MIEDZ SA 6.11%
METAL MINING
--------------------------------------------------------------
BUDIMEX SA 5.90%
CONSTRUCTION
--------------------------------------------------------------------
--------------------------------------------------------------------
TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS
--------------------------------------------------------------------
OIL & GAS EXTRACTION 19.28%
COMMUNICATIONS 17.15%
ELECTRIC SERVICES & UTILITIES 15.73%
METAL MINING 13.27%
FINANCIAL SERVICES 10.88%
19
<PAGE>
<TABLE>
BONNEL GROWTH FUND
--------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
--------------------------------------------------------------------------------
<CAPTION>
COMMON STOCKS 98.38% ............................. SHARES VALUE
------ ------------
<S> <C> <C>
ALUMINUM PRODUCTS 1.18%
------------
Alcoa, Inc. 50,000 $ 3,243,750
BUILDING PRODUCTS 0.16%
------------
Owens Corning 10,000 181,875
Sherwin-Williams Co. 10,000 248,750
------------
430,625
COMMUNICATIONS EQUIPMENT 4.43%
------------
Micrel, Inc. 40,000 3,460,000 (1)
Powerwave Technologies, Inc. 20,000 4,161,250 (1)
Scientific Atlanta, Inc. 70,000 4,554,375
------------
12,175,625
COMPUTER SOFTWARE & HARDWARE 8.06%
------------
Adobe Systems, Inc. 58,000 7,014,375
Advent Software, Inc. 40,000 2,100,000
Computer Associates International, Inc. 30,000 1,674,375
Diebold, Inc. 10,000 288,750
Microchip Technology, Inc. 55,500 3,444,469 (1)
PC Connection, Inc. 25,000 1,196,875 (1)
Rational Software Co. 24,000 2,043,000 (1)
Xilinx, Inc. 60,000 4,395,000 (1)
------------
22,156,844
COMPUTERS & DATA PROCESSING 9.76%
-------------
CDW Computer Centers, Inc. 42,000 4,368,000 (1)
Cisco Systems, Inc. 130,000 9,012,653 (1)
Fiserv, Inc. 10,000 459,375 (1)
In Focus Systems, Inc. 170,000 5,089,375 (1)
SanDisk Corp. 30,000 2,748,750 (1)
Sun Microsystems, Inc. 56,000 5,148,500 (1)
-------------
26,826,653
CONSULTING SERVICES 0.14%
-------------
Diamond Technology Partners, Inc. 5,000 395,625 (1)
DIVERSIFIED MANUFACTURING 3.44%
-------------
Federal Signal Corp. 10,000 203,125
Millipore Corp. 10,000 716,875
Minnesota Mining & Manufacturing Co. (3M) 40,000 3,460,000
Parker-Hannifin Corp. 10,000 465,000
Pentair, Inc. 30,000 1,147,500
20
<PAGE>
<CAPTION>
BONNEL GROWTH FUND
---------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
---------------------------------------------------------------------------------------------
COMMON STOCKS SHARES VALUE
<S> <C> <C>
DIVERSIFIED MANUFACTURING (CONT'D)
---------------------------------------------------------------------------------------------
Teleflex, Inc. 10,000 $ 345,625
United Technologies Corp. 50,000 3,109,375
------------
9,447,500
ELECTRONICS & COMPONENTS 22.06%
---------------------------------------------------------------------------------------------
Altera Corp. 30,000 3,067,500 (*)
American Power Conversion Corp. 100,000 3,531,250 (*)
Amphenol Corp., Class A 40,000 2,550,000 (*)
Analog Devices, Inc. 30,000 2,304,375 (*)
Arrow Electronics, Inc. 20,000 876,250 (*)
AVX Corp. 50,000 4,871,875
Burr-Brown Corp. 45,000 3,065,625 (*)
Credence Systems Corp. 20,000 2,855,000 (*)
Cree, Inc. 5,000 727,500 (*)
Cymer, Inc. 50,000 1,953,125 (*)
EMC Co. 15,000 2,084,063 (*)
Excel Technology, Inc. 20,000 627,500 (*)
II-VI, Inc. 10,000 405,000 (*)
Integrated Measurement Systems, Inc. 30,000 586,875 (*)
KEMET Corp. 20,000 1,490,000 (*)
MKS Instruments, Inc. 10,000 470,000 (*)
Molex, Inc. 45,000 2,472,187
QLogic, Co. 40,000 4,012,500 (*)
SCI Systems, Inc. 10,000 532,500 (*)
Sanmina Corp. 70,000 4,204,375 (*)
Sawtek, Inc. 40,000 1,912,500 (*)
Teradyne, Inc. 20,000 2,200,000 (*)
Three-Five Systems, Inc. 36,666 3,189,942 (*)
TranSwitch Corp. 20,000 1,761,250 (*)
Vishay Intertechnology, Inc. 70,000 5,871,250 (*)
Zoran Corp. 60,000 2,996,250 (*)
------------
60,618,692
FIBER OPTICS 2.90%
---------------------------------------------------------------------------------------------
E-Tek Dynamics, Inc. 5,000 1,023,750 (*)
Harmonic Lightwaves, Inc. 40,000 2,952,500 (*)
JDS Uniphase Corp. 38,560 3,998,190 (*)
------------
7,974,440
FINANCIAL SERVICES 5.83%
---------------------------------------------------------------------------------------------
Bank of America Corp. 80,000 3,920,000
Charles Schwab Corp. 100,000 4,450,000
Chase Manhattan Corp. 40,000 2,882,500
Citigroup, Inc. 80,000 4,755,000
------------
16,007,500
21
<PAGE>
<CAPTION>
BONNEL GROWTH FUND
---------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
---------------------------------------------------------------------------------------------
COMMON STOCKS SHARES VALUE
<S> <C> <C>
FOOD PRODUCTS 0.73%
---------------------------------------------------------------------------------------------
Bestfoods 40,000 $ 2,010,000
FORESTRY 1.17%
---------------------------------------------------------------------------------------------
Weyerhaeuser Co. 60,000 3,206,250
HEALTHCARE EQUIPMENT & SERVICES 0.33%
---------------------------------------------------------------------------------------------
IMPATH, Inc. 20,000 920,000 (*)
HOME FURNISHINGS 0.04%
---------------------------------------------------------------------------------------------
Pier 1 Imports, Inc. 10,000 113,750
HOUSEHOLD PRODUCTS 0.83%
---------------------------------------------------------------------------------------------
Colgate-Palmolive 40,000 2,285,000
INTERNET 0.64%
---------------------------------------------------------------------------------------------
BroadVision, Inc. 40,000 1,757,500 (*)
MACHINERY 1.74%
---------------------------------------------------------------------------------------------
Advanced Energy Industries, Inc. 30,000 2,070,000 (*)
Applied Science & Technology, Inc. 10,000 271,875 (*)
Baldor Electric Co. 10,000 185,625
Graco, Inc. 10,000 338,750
Kulicke & Soffa Industries, Inc. 20,000 1,566,250 (*)
The Manitowoc Co., Inc. 10,000 331,875
------------
4,764,375
MANUFACTURING 1.72%
---------------------------------------------------------------------------------------------
General Electric Co. 30,000 4,717,500
MEDICAL PRODUCTS 3.33%
---------------------------------------------------------------------------------------------
Johnson & Johnson 30,000 2,475,000
PolyMedica Corp. 60,000 3,221,250 (*)
Techne Corp. 40,000 2,845,000 (*)
Theragenics Corp. 60,000 596,250 (*)
------------
9,137,500
MOTOR VEHICLES 0.43%
---------------------------------------------------------------------------------------------
Ford Motor Co. 10,000 546,875
Superior Industries International, Inc. 20,000 643,750
------------
1,190,625
22
<PAGE>
<CAPTION>
BONNEL GROWTH FUND
---------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
---------------------------------------------------------------------------------------------
COMMON STOCKS SHARES VALUE
<S> <C> <C>
NETWORKING PRODUCTS 1.77%
---------------------------------------------------------------------------------------------
Black Box Corp. 10,000 $ 769,375 (*)
Emulex Corp. 35,000 1,588,125 (*)
Extreme Networks, Inc. 5,000 288,125 (*)
Network Appliance, Inc. 30,000 2,218,125 (*)
------------
4,863,750
OIL & GAS EXTRACTION & SERVICES 1.12%
---------------------------------------------------------------------------------------------
Amerada Hess Corp. 10,000 636,250
Chevron Corp. 10,000 851,250
Dynegy, Inc., Class A 10,000 654,375
Sunoco, Inc. 20,000 606,250
Tosco Corp. 10,000 320,625
------------
3,068,750
PAPER PRODUCTS 0.15%
---------------------------------------------------------------------------------------------
Pope & Talbot, Inc. 20,000 423,750
PHARMACEUTICALS 4.47%
---------------------------------------------------------------------------------------------
Biovail Corp. 72,000 3,433,500 (*)
EntreMed, Inc. 40,000 2,097,500 (*)
Jones Pharma, Inc. 80,000 2,305,000
King Pharmaceuticals, Inc. 90,000 4,443,750 (*)
------------
12,279,750
PHOTOGRAPHIC EQUIPMENT 0.86%
---------------------------------------------------------------------------------------------
Concord Camera Corp. 130,000 2,372,500 (*)
PUBLISHING/MULTIMEDIA SERVICES 0.30%
---------------------------------------------------------------------------------------------
The New York Times Co., Class A 20,000 823,750
RESTAURANTS 1.51%
---------------------------------------------------------------------------------------------
Brinker International, Inc. 10,000 318,750 (*)
McDonald's Corp. 100,000 3,812,500
------------
4,131,250
RETAIL 4.12%
---------------------------------------------------------------------------------------------
Bed Bath & Beyond, Inc. 20,000 733,750 (*)
Gap, Inc. 40,000 1,470,000
Linens 'n Things, Inc. 40,000 1,235,000 (*)
Liz Claiborne 30,000 1,389,375
23
<PAGE>
<CAPTION>
BONNEL GROWTH FUND
---------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
---------------------------------------------------------------------------------------------
COMMON STOCKS SHARES VALUE
<S> <C> <C>
RETAIL (CONT'D)
---------------------------------------------------------------------------------------------
Safeway, Inc. 100,000 $ 4,412,500 (*)
The Timberland Co., Class A 20,000 1,387,500 (*)
Walgreen Co. 25,000 703,125
------------
11,331,250
SEMICONDUCTORS 8.14%
---------------------------------------------------------------------------------------------
Applied Materials, Inc. 50,000 5,090,625 (*)
Dallas Semiconductor Corp. 40,000 1,717,500
Elantec Semiconductor, Inc. 40,000 1,620,000 (*)
Intel Co. 30,000 3,804,375
International Rectifier Corp. 10,000 491,250 (*)
KLA-Tencor Corp. 20,000 1,497,500
Novellus Systems, Inc. 40,000 2,667,500
Semtech Corp. 20,000 1,363,750 (*)
TriQuint Semiconductor, Inc. 40,000 4,112,500 (*)
------------
22,365,000
TELECOMMUNICATIONS 4.65%
---------------------------------------------------------------------------------------------
ADTRAN, Inc. 20,000 1,351,250 (*)
Copper Mountain Networks, Inc. 5,000 416,875 (*)
Linear Technology Corp. 60,000 3,427,500
Lucent Technologies, Inc. 10,000 621,875
Tollgrade Communications, Inc. 60,000 3,960,000 (*)
Univision Communications, Inc., Class A 20,000 2,185,000 (*)
XETA Corp. 20,000 825,000 (*)
------------
12,787,500
TRANSPORTATION 1.48%
---------------------------------------------------------------------------------------------
Kansas City Southern Industries, Inc. 45,000 3,234,375
Union Pacific Corp. 20,000 842,500
------------
4,076,875
UNIT INVESTMENT TRUST 0.68%
---------------------------------------------------------------------------------------------
Nasdaq-100 Shares 20,000 1,877,500 (*)
WHOLESALE & DISTRIBUTION 0.21%
---------------------------------------------------------------------------------------------
Fastenal Co. 10,000 584,375 (*)
---------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS 270,365,754
---------------------------------------------------------------------------------------------
(cost $221,017,901)
24
<PAGE>
<CAPTION>
BONNEL GROWTH FUND
---------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
---------------------------------------------------------------------------------------------
PRINCIPAL
REPURCHASE AGREEMENT 3.73% AMOUNT VALUE
<S> <C> <C>
Joint Tri-Party Repurchase Agreement, Donaldson,
Lufkin & Jenrette, 4/28/00, 5.70%, due 5/1/00,
repurchase price $10,248,693 collateralized by
U.S. Treasury securities held in a joint
tri-party repurchase account (cost $10,243,827) $10,243,827 $ 10,243,827
---------------------------------------------------------------------------------------------
TOTAL INVESTMENTS 102.11% 280,609,581
---------------------------------------------------------------------------------------------
(cost $231,261,728)
Other assets and liabilities, net (2.11)% (5,800,711)
------------
NET ASSETS 100% $274,808,870
------------
(*) Non-income producing security See accompanying notes to portfolios of
investments.
</TABLE>
25
<PAGE>
<TABLE>
MEGATRENDS FUND
--------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
--------------------------------------------------------------------------------------------
<CAPTION>
COMMON STOCKS 90.84% SHARES VALUE
<S> <C> <C>
BANKS 2.45%
--------------------------------------------------------------------------------------------
Chase Manhattan Corp. 6,000 $ 432,375
BUILDING PRODUCTS 3.75%
--------------------------------------------------------------------------------------------
Home Depot, Inc. 5,000 280,313
Masco Corp. 17,000 381,437
-----------
661,750
COMPUTERS & DATA PROCESSING 6.94%
--------------------------------------------------------------------------------------------
Ciber, Inc. 14,000 252,875 (*)
Cisco Systems, Inc. 2,000 138,656 (*)
Hewlett Packard Co. 4,500 607,500
International Business Machines Corp. 2,000 223,250
-----------
1,222,281
ELECTRONICS & COMPONENTS 2.88%
--------------------------------------------------------------------------------------------
Intel Corp. 4,000 507,250
FINANCIAL SERVICES 3.91%
--------------------------------------------------------------------------------------------
Alliance Capital Management Holding L.P. 10,000 448,125
Fannie Mae 4,000 241,250
-----------
689,375
HEALTHCARE 6.17%
--------------------------------------------------------------------------------------------
Cardinal Health, Inc. 11,000 605,688
Patterson Dental Co. 10,000 481,250 (*)
-----------
1,086,938
HOLDING COMPANY 3.36%
--------------------------------------------------------------------------------------------
Berkshire Hathaway, Inc., Class A 10 593,000 (*)
INSURANCE 8.16%
--------------------------------------------------------------------------------------------
ACE Ltd. 34,000 813,875
St. Paul Companies, Inc. 17,500 623,438
-----------
1,437,313
MANUFACTURING 6.19%
--------------------------------------------------------------------------------------------
Honeywell International, Inc. 8,000 448,000
Tyco International Ltd. 14,000 643,125
-----------
1,091,125
26
<PAGE>
<CAPTION>
MEGATRENDS FUND
--------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
--------------------------------------------------------------------------------------------
COMMON STOCKS SHARES VALUE
<S> <C> <C>
METAL MINING 9.70%
--------------------------------------------------------------------------------------------
Anglo American Platinum Corp. Ltd., ADR 7,500 $ 178,087
Apex Silver Mines Ltd. 75,000 731,250 (*)
Impala Platinum Holdings Ltd., ADR 6,000 184,236
Stillwater Mining Co. 22,000 616,000 (*)
-----------
1,709,573
OIL & GAS EXTRACTION & SERVICES 13.70%
--------------------------------------------------------------------------------------------
Burlington Resources, Inc. 20,000 786,250
Nabors Industries, Inc. 18,000 709,875 (*)
Noble Drilling Corp. 23,000 918,562 (*)
-----------
2,414,687
PHARMACEUTICALS 7.98%
--------------------------------------------------------------------------------------------
Elan Corp. plc, ADR 21,000 900,375 (*)
Pfizer, Inc. 12,000 505,500
-----------
1,405,875
REAL ESTATE INVESTMENT TRUSTS 3.12%
--------------------------------------------------------------------------------------------
BRE Properties, Inc., Class A 7,000 195,563
Spieker Properties, Inc. 8,000 354,500
-----------
550,063
RETAIL 1.56%
--------------------------------------------------------------------------------------------
AutoZone, Inc. 12,000 275,250 (*)
TELECOMMUNICATIONS 7.05%
--------------------------------------------------------------------------------------------
ALLTEL Corp. 5,000 333,125
MCI Worldcom, Inc. 20,000 908,750 (*)
-----------
1,241,875
UTILITIES 3.92%
--------------------------------------------------------------------------------------------
Duke Energy Co. 12,000 690,000
--------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS 16,008,730
--------------------------------------------------------------------------------------------
(cost $13,379,718)
27
<PAGE>
<CAPTION>
MEGATRENDS FUND
--------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
--------------------------------------------------------------------------------------------
PRINCIPAL
REPURCHASE AGREEMENT 7.36% AMOUNT VALUE
<S> <C> <C>
Joint Tri-Party Repurchase Agreement, Donaldson,
Lufkin & Jenrette, 4/28/00, 5.70%, due 5/1/00,
repurchase price $1,297,915 collateralized by
U.S. Treasury securities held in a joint tri-party
repurchase account (cost $1,297,299) $1,297,299 $ 1,297,299
--------------------------------------------------------------------------------------------
TOTAL INVESTMENTS 98.20% 17,306,029
--------------------------------------------------------------------------------------------
(cost $14,677,017)
Other assets and liabilities, net 1.80% 316,317
-----------
NET ASSETS 100% $17,622,346
-----------
ADR - American Depositary Receipt
(*) Non-income producing security
See accompanying notes to portfolios of investments.
</TABLE>
28
<PAGE>
<TABLE>
REGENT EASTERN EUROPEAN FUND
--------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
--------------------------------------------------------------------------------------------
<CAPTION>
COMMON AND PREFERRED STOCKS 96.42% SHARES VALUE
<S> <C> <C>
CHEMICALS 7.81%
--------------------------------------------------------------------------------------------
BorsodChem Rt., GDR 12,552 $ 462,541
COMMUNICATIONS 16.54%
--------------------------------------------------------------------------------------------
Magyar Tavkozlesi Rt., ADR 10,114 352,094
Rostelekom 109,900 364,868 (*)
Telekomunikacja Polska SA, GDR 34,167 262,232
----------
979,194
COMPUTERS & DATA PROCESSING 2.58%
--------------------------------------------------------------------------------------------
ComArch SA 1,704 70,905 (*)
Softbank SA, GDR 1,933 82,153
----------
153,058
CONSTRUCTION 5.69%
--------------------------------------------------------------------------------------------
Budimex SA 51,200 336,752 (*)
ELECTRIC SERVICES & UTILITIES 15.17%
--------------------------------------------------------------------------------------------
Elektrim Spolka Akcyjna 33,922 432,562 (*)
Unified Energy Systems 2,497,062 465,452 (*)
----------
898,014
FINANCIAL SERVICES 10.49%
--------------------------------------------------------------------------------------------
Central European Growth Fund 379,030 333,584 (*)
Europejski Fundusz Leasingowy SA, GDR 600 11,445 (*)
OTP Bank, Preferred Stock 3,503 77,912
SKB Banka, GDR 6,225 60,849
Zagrebacka Banka, GDR 9,502 137,066
----------
620,856
MANUFACTURING 2.85%
--------------------------------------------------------------------------------------------
Graboplast Rt. 4,076 38,043 (*)
Graboplast Rt., GDR 33,890 55,071 (*)
Mostostal-Export 82,764 75,913
----------
169,027
METAL MINING 12.80%
--------------------------------------------------------------------------------------------
Ashurst Technology Ltd., Units 93,470 0 (*)
KGHM Polska Miedz SA 51,998 348,980
Norilsk Nickel 36,000 408,600 (*)
----------
757,580
29
<PAGE>
<CAPTION>
REGENT EASTERN EUROPEAN FUND
--------------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS April 30, 2000
--------------------------------------------------------------------------------------------
COMMON AND PREFERRED STOCKS SHARES VALUE
<S> <C> <C>
OIL & GAS EXTRACTION 18.59%
--------------------------------------------------------------------------------------------
Lukoil Holdings, ADR 8,470 $ 510,572
MOL Magyar Olaj-es Gazipari Rt. 11,000 194,097
MOL Magyar Olaj-es Gazipari Rt., GDR 15,948 281,084
Primagaz Hungaria Co., Ltd. 13,270 114,505
----------
1,100,258
PHARMACEUTICALS 3.90%
--------------------------------------------------------------------------------------------
Pliva d.d., GDR 18,393 230,832
--------------------------------------------------------------------------------------------
TOTAL INVESTMENTS 96.42% 5,708,112
--------------------------------------------------------------------------------------------
(cost $5,877,408)
Other assets and liabilities, net 3.58% 211,831
----------
NET ASSETS 100% $5,919,943
----------
ADR - American Depositary Receipt GDR - Global Depositary Receipt (*)
Non-income producing security
See accompanying notes to portfolios of investments.
</TABLE>
30
<PAGE>
-----------------------------------------------------------------------------
NOTES TO PORTFOLIOS OF INVESTMENTS April 30, 2000
-----------------------------------------------------------------------------
<TABLE>
GLOBAL PORTFOLIO SECURITIES BY COUNTRY
<CAPTION>
PERCENTAGE OF
COUNTRY VALUE TOTAL INVESTMENTS
<S> <C> <C>
REGENT EASTERN EUROPEAN FUND
------------------------------------------------------------------------------------
Russia $1,749,492 30.65%
Poland 1,620,941 28.40
Hungary 1,575,346 27.60
Croatia 367,899 6.44
United Kingdom 333,585 5.84
Slovenia 60,849 1.07
------------------------------------------------------------------------------------
TOTAL INVESTMENTS $5,708,112 100.00%
------------------------------------------------------------------------------------
</TABLE>
JOINT TRI-PARTY REPURCHASE AGREEMENTS (SEE ALSO NOTE 1 TO FINANCIAL STATEMENTS.)
The terms of the repurchase agreements at April 30, 2000 were:
Donaldson, Lufkin & Jenrette repurchase agreement, 4/28/00, 5.70%, due 5/1/00
Total principal amount: $47,288,902; Total repurchase value: $47,311,364
The securities held as collateral in the tri-party joint repurchase agreements
at April 30, 2000 were:
$65,445,000 U.S. Treasury Strip, 0.00%, 08/15/22
$37,491,000 U.S. Treasury Strip, 0.00%, 02/15/18
$24,942,000 U.S. Treasury Strip, 0.00%, 11/15/22
$19,756,000 U.S. Treasury Strip, 0.00%, 05/15/13
$5,541,000 U.S. Treasury Strip, 0.00%, 08/15/10
$1,857,000 U.S. Treasury Strip, 0.00%, 11/15/17
$1,769,000 U.S. Treasury Strip, 0.00%, 02/15/21
(Total collateral market value of $48,234,932)
Other mutual funds managed by U.S. Global Investors, Inc. participate in the
tri-party joint repurchase agreements. Each owns an undivided interest in
the accounts.
31
<PAGE>
<TABLE>
---------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES April 30, 2000
---------------------------------------------------------------------------
<CAPTION>
BONNEL GROWTH MEGATRENDS REGENT EASTERN
FUND FUND EUROPEAN FUND
<S> <C> <C> <C>
Investments, at identified
cost $231,261,728 $14,677,017 $5,877,408
============ =========== ==========
ASSETS
---------------------------------------------------------------------------
Investments, at value:
Securities $270,365,754 $16,008,730 $5,708,112
Repurchase agreements 10,243,827 1,297,299 --
Cash 2,097,046 -- 7,393
Receivables:
Investments sold 26,940,856 1,652,307 216,985
Dividends 40,975 6,215 8,852
Interest 4,866 616 --
Capital shares sold 4,023,331 50 150
From manager -- -- --
Other assets 8,862 691 151
---------------------------------------------------------------------------
TOTAL ASSETS 313,725,517 18,965,908 5,941,643
---------------------------------------------------------------------------
LIABILITIES
---------------------------------------------------------------------------
Payables:
Investments purchased 38,060,573 1,297,299 --
Capital shares redeemed 338,211 -- 6,770
To manager and affiliates 259,566 16,770 7,606
Accounts payable and
accrued expenses 258,297 29,493 7,324
---------------------------------------------------------------------------
TOTAL LIABILITIES 38,916,647 1,343,562 21,700
---------------------------------------------------------------------------
NET ASSETS $274,808,870 $17,622,346 $5,919,943
============ =========== ==========
NET ASSETS CONSIST OF:
---------------------------------------------------------------------------
Paid-in capital $147,520,769 $13,347,788 $6,580,450
Accumulated undistributed
net investment loss (1,548,694) (32,154) (136,956)
Accumulated net realized
gain (loss) on investments
and foreign currencies 79,488,942 1,677,700 (354,214)
Net unrealized appreciation
(depreciation) of
investments and other
assets and liabilities
denominated in foreign
currencies 49,347,853 2,629,012 (169,337)
------------ ----------- ----------
Net assets applicable to
capital shares outstanding $274,808,870 $17,622,346 $5,919,943
============ =========== ==========
Capital shares outstanding,
unlimited number of no par
shares authorized 7,733,294 1,527,124 520,697
============ =========== ==========
NET ASSET VALUE, PER SHARE $ 35.54 $ 11.54 $ 11.37
============ =========== ==========
See accompanying notes to financial statements.
</TABLE>
32
<PAGE>
<TABLE>
---------------------------------------------------------------------------
STATEMENTS OF OPERATIONS For the Six Months Ended
April 30, 2000
---------------------------------------------------------------------------
<CAPTION>
BONNEL GROWTH MEGATRENDS REGENT EASTERN
FUND FUND EUROPEAN FUND
<S> <C> <C> <C>
NET INVESTMENT
INCOME
INCOME:
---------------------------------------------------------------------------
Dividends $ 126,922 $ 70,451 $ 9,206
Foreign taxes withheld on
dividends -- -- (531)
----------- ---------- ----------
Net dividends 126,922 70,451 8,675
Securities lending 56,493 385 117
Interest and other 198,785 89,792 10,713
----------- ---------- ----------
TOTAL INCOME 382,200 160,628 19,505
EXPENSES:
---------------------------------------------------------------------------
Management fees 1,316,011 86,538 39,337
Transfer agent fees and
expenses 102,864 19,521 12,916
Accounting service fees and
expenses 33,884 19,789 20,048
Legal and professional fees 68,932 22,931 15,709
Distribution plan expenses 329,003 9,145 7,867
Custodian fees 26,562 9,354 13,669
Shareholder reporting
expenses 29,140 7,443 4,985
Registration fees 8,170 5,069 4,349
Trustees' fees and expenses 12,529 11,799 11,940
Interest expense 262 16 6
Miscellaneous expenses 10,660 2,920 1,042
----------- ---------- ----------
Total expenses before
reductions 1,938,017 194,525 131,868
Short-term trading fee (262) (16) (6)
Expenses offset (6,861) (1,727) (149)
----------- ---------- ----------
NET EXPENSES 1,930,894 192,782 131,713
---------------------------------------------------------------------------
NET INVESTMENT LOSS (1,548,694) (32,154) (112,208)
---------------------------------------------------------------------------
NET REALIZED AND
UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Realized gain (loss) from:
Securities 79,783,864 1,677,408 311,833
Foreign currency
transactions -- -- (7,672)
----------- ---------- ----------
NET REALIZED GAIN 79,783,864 1,677,408 304,161
----------- ---------- ----------
Net change in unrealized
appreciation (depreciation)
of:
Investments 17,432,333 1,316,490 1,399,542
Other assets and
liabilities denominated in
foreign currencies -- -- (42)
----------- ---------- ----------
NET UNREALIZED APPRECIATION 17,432,333 1,316,490 1,399,500
----------- ---------- ----------
---------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS 97,216,197 2,993,898 1,703,661
---------------------------------------------------------------------------
NET INCREASE IN NET
ASSETS RESULTING FROM
OPERATIONS $95,667,503 $2,961,744 $1,591,453
=========== ========== ==========
See accompanying notes to financial statements.
</TABLE>
33
<PAGE>
<TABLE>
-------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
-------------------------------------------------------------------------------------------
<CAPTION>
BONNEL GROWTH FUND
---------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, 1999
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
-------------------------------------------------------------------------------------------
Net investment loss $ (1,548,694) $ (1,571,581)
Net realized gain (loss) 79,783,864 28,060,703
Net unrealized appreciation 17,432,333 25,165,059
------------ ------------
NET INCREASE IN NET ASSETS FROM INVESTMENT
OPERATIONS 95,667,503 51,654,181
DISTRIBUTIONS TO SHAREHOLDERS:
-------------------------------------------------------------------------------------------
From net investment income -- --
From net capital gains (24,785,515) (3,150,077)
------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (24,785,515) (3,150,077)
FROM CAPITAL SHARE TRANSACTIONS:
-------------------------------------------------------------------------------------------
Proceeds from shares sold 146,914,707 36,732,366
Distributions reinvested 24,058,114 3,037,219
Paid-in capital portion of short-term trading
fee 38,540 26,232
------------ ------------
171,011,361 39,795,817
Cost of shares redeemed (101,033,450) (42,101,926)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS 69,977,911 (2,306,109)
-------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 140,859,899 46,197,995
-------------------------------------------------------------------------------------------
NET ASSETS
Beginning of year 133,948,971 87,750,976
-------------------------------------------------------------------------------------------
END OF PERIOD $274,808,870 $133,948,971
-------------------------------------------------------------------------------------------
Undistributed net investment income, end of period $ (1,548,694) $ --
============ ============
CAPITAL SHARE ACTIVITY
-------------------------------------------------------------------------------------------
Shares sold 4,347,402 1,786,758
Shares reinvested 978,370 177,511
Shares redeemed (2,913,592) (2,067,277)
------------ ------------
NET SHARE ACTIVITY 2,412,180 (103,008)
============ ============
See accompanying notes to financial statements.
</TABLE>
34
<PAGE>
<TABLE>
------------------------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
------------------------------------------------------------------------------------------------------------
<CAPTION>
REGENT EASTERN
MEGATRENDS FUND EUROPEAN FUND
------------------------------------- -------------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, 1999 APRIL 30, 2000 OCTOBER 31, 1999
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
FROM INVESTMENT OPERATIONS:
------------------------------------------------------------------------------------------------------------------------------------
Net investment loss $ (32,154) $ (9,474) $ (112,208) $ (138,122)
Net realized gain (loss) 1,677,408 1,669,405 304,161 (284,318)
Net unrealized appreciation 1,316,490 846,486 1,399,500 849,932
----------- ----------- ---------- ----------
NET INCREASE IN NET ASSETS FROM
INVESTMENT OPERATIONS 2,961,744 2,506,417 1,591,453 427,492
DISTRIBUTIONS TO SHAREHOLDERS:
------------------------------------------------------------------------------------------------------------------------------------
From net investment income -- -- -- --
From net capital gains (1,656,853) (3,268,120) -- --
----------- ----------- ---------- ----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (1,656,853) (3,268,120) -- --
FROM CAPITAL SHARE TRANSACTIONS:
------------------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 368,537 1,151,502 1,580,705 1,558,408
Distributions reinvested 1,602,904 3,186,923 -- --
Paid-in capital portion of short-term trading
fee 177 278 17,487 12,305
----------- ----------- ---------- ----------
1,971,618 4,338,703 1,598,192 1,570,713
Cost of shares redeemed (3,106,895) (6,863,801) (2,479,924) (2,464,106)
----------- ----------- ---------- ----------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS (1,135,277) (2,525,098) (881,732) (893,393)
------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 169,614 (3,286,801) 709,721 (465,901)
------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of year 17,452,732 20,739,533 5,210,222 5,676,123
------------------------------------------------------------------------------------------------------------------------------------
END OF PERI0D $17,622,346 $17,452,732 $5,919,943 $5,210,222
------------------------------------------------------------------------------------------------------------------------------------
Undistributed net investment income, end of period $ (32,154) $ -- $ (136,956) $ (24,748)
=========== =========== ========== ==========
CAPITAL SHARE ACTIVITY
------------------------------------------------------------------------------------------------------------------------------------
Shares sold 33,940 107,017 133,199 177,873
Shares reinvested 161,583 328,888 -- --
Shares redeemed (289,927) (642,295) (213,984) (284,245)
----------- ----------- ---------- ----------
NET SHARE ACTIVITY (94,404) (206,390) (80,785) (106,372)
=========== =========== ========== ==========
</TABLE>
35
<PAGE>
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS April 30, 2000
----------------------------------------------------------------------
NOTE 1: SIGNIFICANT ACCOUNTING POLICIES
U.S. Global Accolade Funds (Trust), consisting of three separate funds (funds),
is organized as a Massachusetts business trust. Each fund is a diversified,
open-end management investment company registered under the Investment Company
Act of 1940, as amended.
The following is a summary of significant accounting policies consistently
followed by the funds in the preparation of their financial statements. The
policies are in conformity with generally accepted accounting principles.
A. SECURITY VALUATIONS
The funds value investments traded on national or international securities
exchanges or over-the-counter at the last sales price reported by the
security's primary exchange at the time of daily valuation. Securities for
which no sale was reported are valued at the mean between the last reported bid
and ask prices or using quotes provided by principal market makers. Short-term
investments with effective maturities of sixty days or less at the date of
purchase may be valued at amortized cost, which approximates market value.
Securities for which market quotations are not readily available are valued at
their fair value as determined in good faith under consistently applied
procedures under the general supervision of the board of trustees.
B. SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are accounted for on trade date. Realized gains and
losses from security transactions are determined on an identified-cost basis.
Dividend income is recorded on the ex-dividend date or, for certain foreign
securities, when the information becomes available to the funds. Interest
income is recorded on an accrual basis. Investment income is recorded net of
foreign taxes withheld where recovery of such taxes is uncertain.
The funds may purchase securities on a when-issued or delayed- delivery basis
and segregate on their books collateral with a value at least equal to the
amount of the commitment. Losses may arise due to the changes in the value of
the underlying securities or if the counterparty does not perform under the
contract.
Whereas the prospectus allows loans of portfolio securities up to one-third of
net assets for Bonnel Growth and Regent Eastern European Funds and up to 25% of
total assets for MegaTrends Fund, the trustees have imposed an internal limit
of 10% of net assets. This limit was increased to 15% on May 25, 2000. The
securities are loaned to brokers, dealers or other financial institutions in
exchange for a negotiated lender's fee. These fees are securities lending
income. The loans are collateralized by cash, U.S. government securities, high
quality money market instruments or other securities that are maintained at all
times in an amount at least equal to the current market value of the loaned
securities, plus a margin
36
<PAGE>
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS April 30, 2000
----------------------------------------------------------------------
depending on the types of securities loaned. The market value of the loaned
securities is determined at the close of business of the fund and any
additional required collateral is delivered to the fund on the next business
day. In the event of default or bankruptcy by the borrower, retention of the
collateral may be subject to legal proceedings.
The market value of securities on loan and the related collateral at April 30,
2000 was:
<TABLE>
<CAPTION>
MARKET
FUND VALUE COLLATERAL
------------------------------------------------------------------------------
<S> <C> <C>
Bonnel Growth Fund $9,684,063 $9,904,200
MegaTrends Fund 765,400 802,400
</TABLE>
C. REPURCHASE AGREEMENTS
The funds may enter into repurchase agreements with recognized financial
institutions or registered broker/dealers and, in all instances, hold, as
collateral, underlying securities with a value exceeding the total repurchase
price, including accrued interest. The funds use joint tri-party repurchase
agreement accounts with other funds under common management where uninvested
cash is collectively invested in repurchase agreements, and each participating
fund owns an undivided interest in the account.
D. FOREIGN CURRENCY TRANSACTIONS
Some funds may invest in securities of foreign issuers. The accounting records
of these funds are maintained in U.S. dollars. At each net asset value
determination date, the value of assets and liabilities denominated in foreign
currencies are translated into U.S. dollars using the current prevailing
exchange rate. Security transactions, income and expenses are converted at the
prevailing rate of exchange on the respective dates of the transactions. The
effect of changes in foreign exchange rates on foreign denominated securities
is included with the net realized and unrealized gain or loss on securities.
Other foreign currency gains or losses are reported separately.
E. OPTIONS
Some funds may write or purchase options on securities to manage their exposure
to stock or commodity markets as well as fluctuations in interest and currency
conversion rates. Written options include a risk of loss in excess of the
option premium. The use of options carries the risks of a change in value of
the underlying instruments, an illiquid secondary market, or failure of the
counterparty to perform its obligations. The option premium is the basis for
recognition of unrealized or realized gain or loss on the option. The cost of
securities acquired or the proceeds from securities sold through the exercise
of the
37
<PAGE>
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS April 30, 2000
----------------------------------------------------------------------
option is adjusted by the amount of the premium. There was no activity in
options written or purchased for the six months ended April 30, 2000.
F. INCOME TAXES
The funds intend to continue to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of their taxable income to shareholders. Accordingly, no
provision for federal income taxes is required. Each fund may be subject to
foreign taxes on income and gains on investments, which are accrued based on
the fund's understanding of the tax rules and regulations in the foreign
markets.
G. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
The funds record dividends and distributions to shareholders on the ex-dividend
date. Distributions are determined in accordance with income tax regulations,
which may differ from generally accepted accounting principles. Accordingly,
periodic reclassifications related to permanent book and tax basis differences
are made within the funds' capital accounts to reflect income and gains
available for distribution under income tax regulations. The funds make
distributions at least annually.
H. EXPENSES
Each fund bears expenses incurred specifically on its behalf plus an allocation
of its share of Trust level expenses. Short-term trading fees collected from
temporary investors in the funds are applied as a reduction of expenses to the
extent of such related costs; any excess of short-term trading fees is treated
as paid-in capital. Expense offset arrangements have been made with the funds'
custodian so the custodian fees may be paid indirectly by credits earned on the
funds' cash balances. Such deposit arrangements are an alternative to overnight
investments.
I. USE OF ESTIMATES IN FINANCIAL STATEMENT PREPARATION
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
NOTE 2: RELATED PARTY TRANSACTIONS
U.S. Global Investors, Inc. (Adviser), under an investment advisory agreement
with the Trust in effect through March 8, 2001, furnishes management and
investment advisory services and, subject to the supervision of the trustees,
directs the investments of each fund according to its investment objectives,
policies and limitations. The Adviser also furnishes all necessary office
facilities, business
38
<PAGE>
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS April 30, 2000
----------------------------------------------------------------------
equipment and personnel for administering the affairs of the Trust. Frank E.
Holmes, a trustee of the funds, is the controlling owner of the Adviser.
For each fund, the Adviser has contracted with and compensates sub-advisers to
serve in the execution of the Adviser's investment responsibilities as follows:
Bonnel Growth Fund Bonnel, Inc.
MegaTrends Fund Money Growth Institute, Inc.
Regent Eastern European Fund Regent Fund Management, Ltd.
For the services of the Adviser, each fund pays a management fee at an annual
rate of 1.00% for Bonnel Growth Fund and MegaTrends Fund and 1.25% for Regent
Eastern European Fund based on their average net assets. Fees are accrued daily
and paid monthly.
United Shareholder Services, Inc. (USSI), a wholly-owned subsidiary of the
Adviser, is transfer agent for the funds. Each fund pays an annual fee based on
the number of shareholder accounts for transfer agency services. Certain
account fees are paid directly by shareholders to the transfer agent, which, in
turn, reduces its charge to the funds. Additionally, the Adviser is reimbursed
at cost for in-house legal services pertaining to each fund. Effective November
1, 1997, the funds engaged Brown Brothers Harriman & Co. as the custodian, fund
accounting and administration service agent with a fee structure based on
average net assets of the funds.
Each fund has adopted a distribution plan pursuant to Rule 12b-1 of the
Investment Company Act of 1940 that allows an annual fee of up to 0.25% of its
average net assets to be used for, or to reimburse the Adviser for,
expenditures in connection with sales and promotional services related to the
distribution of each fund's shares. A portion of this fee may be reallowed to
securities dealers, banks and other financial institutions for the distribution
of shares and providing shareholder support services.
Leeb Brokerage Services, a broker/dealer affiliate of Money Growth Institute,
Inc., received $45,337, representing 92.53%, of commissions paid by MegaTrends
Fund on purchases and sales of securities during the six months ended April 30,
2000.
During the six months ended April 30, 2000, A & B Mailers, Inc., a wholly-owned
subsidiary of the Adviser, was paid $22,838 for mailing services provided to
the funds.
The three independent trustees each receive $8,000 annually as compensation for
serving on the board, plus $2,000 per each quarterly meeting attended. The
Chairman and members of special committees receive additional compensation.
Trustees are also reimbursed for out-of-pocket expenses incurred while
attending
39
<PAGE>
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS April 30, 2000
----------------------------------------------------------------------
meetings. Frank E. Holmes receives no compensation from the funds
for serving on the board.
NOTE 3: INVESTMENTS
Purchases and sales of long-term securities for the six months ended April 30,
2000, are summarized as follows:
<TABLE>
<CAPTION>
FUND PURCHASES SALES
-----------------------------------------------------------------------------
<S> <C> <C>
Bonnel Growth $347,284,911 $307,551,748
MegaTrends 12,627,403 13,309,189
Regent Eastern European 1,177,440 2,136,768
</TABLE>
The following table presents the income tax basis of securities owned on April
30, 2000, and the tax basis components of net unrealized appreciation or
depreciation:
<TABLE>
<CAPTION>
GROSS GROSS NET UNREALIZED
AGGREGATE UNREALIZED UNREALIZED APPRECIATION
FUND COST APPRECIATION DEPRECIATION (DEPRECIATION)
---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Bonnel Growth $231,261,728 $58,612,801 $9,264,948 $49,347,853
MegaTrends 14,677,017 3,168,551 539,539 2,629,012
Regent Eastern
European 5,877,408 986,672 1,155,968 (169,296)
</TABLE>
At April 30, 2000, Regent Eastern European Fund had capital loss carryovers of
$374,861 with an expiration date of October 31, 2006, and $185,242 with an
expiration date of October 31, 2007.
Regent Eastern European Fund may be exposed to risks not typically associated
with investment in the United States due to its concentration of investments in
emerging markets. These risks include disruptive political or economic
conditions and the possible imposition of adverse governmental laws or currency
exchange restrictions.
40
<PAGE>
----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS April 30, 2000
----------------------------------------------------------------------
NOTE 4: REVOLVING DEMAND NOTES
On March 1, 2000, each of the U.S. Global Accolade Funds, along with other
funds under common management, entered into revolving demand notes with Brown
Brothers Harriman & Co. as denoted below subject to the borrowing limits as set
forth in the funds' registration statement. These notes are collateralized by
any or all of the securities held by Brown Brothers Harriman & Co. as the
funds' custodian. Borrowings under these notes are charged interest at the
current overnight Federal Funds Rate plus 2%. Each U.S. Global Accolade Fund
has a maximum borrowing limit of the lesser of 5% of its net asset value or
$10,000,000. There were no borrowings under the revolving demand notes at April
30, 2000.
From March 1, 1999 to February 29, 2000, the U.S. Global Accolade Funds, along
with other funds under common management, participated in an $85 million
revolving credit facility (Facility) dated March 1, 1999. Commitment fees
related to the Facility were paid by the participating funds. A one-time set up
fee was paid on March 1, 1999. Additionally, an annual fee of $75,000, and
quarterly commitment fees totaling $127,500 were paid within each annual
period. These expenses were shared by all funds under common management.
Borrowings under these notes were charged interest at the current overnight
Federal Funds Rate plus 2%.
NOTE 5: SHARES OF BENEFICIAL INTEREST
At April 30, 2000, individual shareholders holding 5% or more of outstanding
shares comprised 8.09% of Regent Eastern European Fund.
41
<PAGE>
<TABLE>
---------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
---------------------------------------------------------------------------------------------------------
BONNEL GROWTH FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE:
<CAPTION>
SIX MONTHS YEAR ENDED PERIOD
ENDED OCTOBER 31, ENDED YEAR ENDED SEPTEMBER 30,
APRIL 30, ------------------ OCT. 31, ------------------------------
2000 1999 1998 1997 (*) 1997 1996 1995 (**)
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING
OF PERIOD $25.17 $16.18 $19.68 $21.86 $17.15 $14.81 $10.02
---------------------------------------------------------------------------------------------------------
Investment Activities
Net investment loss (.20) (.30) (.23) (.03) (.21) (.14) (.07)
Net realized and
unrealized gain (loss) 14.32 9.87 .44 (2.15) 5.09 3.13 4.91
-------- -------- ------- -------- -------- ------- -------
Total from investment
activities 14.12 9.57 .21 (2.18) 4.88 2.99 4.84
-------- -------- ------- -------- -------- ------- -------
Distributions
From net investment
income -- -- -- -- -- -- (.05)
From net realized gains (3.75) (.58) (3.71) -- (.17) -- --
In excess of net realized
gains -- -- -- -- -- (.65) --
-------- -------- ------- -------- -------- ------- -------
Total distributions (3.75) (.58) (3.71) -- (.17) (.65) (.05)
---------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF
PERIOD $35.54 $25.17 $16.18 $19.68 $21.86 $17.15 $14.81
---------------------------------------------------------------------------------------------------------
TOTAL RETURN
(excluding account fees) (a) 62.70% 60.85% .80% (9.97)% 28.67% 21.27% 48.74%
Ratios to Average Net
Assets (b):
Net investment loss (1.18)% (1.41)% (1.19)% (1.43)% (1.18)% (1.32)% (1.46)%
Total expenses 1.47% 1.77% 1.85% 1.72% 1.77% 1.83% 2.50%
Expenses reimbursed or
offset -- -- (.01)% -- -- -- (.02)%
Net expenses 1.47% 1.77% 1.84% 1.72% 1.77% 1.83% 2.48%
Portfolio turnover rate 253% 197% 190% 52% 239% 212% 145%
Net assets, end of period
(in thousands) $274,809 $133,949 $87,751 $104,643 $117,891 $90,696 $24,673
(*) For the month ended October 31, 1997.
(**) From October 17, 1994, commencement of operations.
(a) Total returns for period less than one year are not annualized.
(b) Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as discussed in
the notes to the financial statements. These amounts would decrease the
net investment income ratio had such reductions not occurred.
</TABLE>
42
<PAGE>
<TABLE>
-----------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
-----------------------------------------------------------------------------------------------------------
MEGATRENDS FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE:
<CAPTION>
SIX MONTHS YEAR ENDED PERIOD
ENDED OCTOBER 31, ENDED YEAR ENDED JUNE 30,
APRIL 30, ----------------- OCT. 31, -----------------------------
2000 1999 1998 1997 (*) 1997 (**) 1996 1995
<S> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF
PERIOD $10.76 $11.35 $13.90 $13.45 $11.27 $11.17 $10.29
-----------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income (loss) (.02) (.01) (.02) .01 .01 .17 .28
Net realized and unrealized
gain (loss) 1.85 1.27 (.51) .44 2.39 1.72 .95
------- ------- ------- ------- ------- ------- -------
Total from investment
activities 1.83 1.26 (.53) .45 2.40 1.89 1.23
------- ------- ------- ------- ------- ------- -------
Distributions
From net investment income -- -- -- -- (.01) (.17) (.28)
In excess of net investment
income -- -- (.01) -- -- -- --
From net realized gains (1.05) (1.85) (2.01) -- (.21) (1.61) --
In excess of net realized
gains -- -- -- -- -- (.01) (.07)
------- ------- ------- ------- ------- ------- -------
Total distributions (1.05) (1.85) (2.02) -- (.22) (1.79) (.35)
-----------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $11.54 $10.76 $11.35 $13.90 $13.45 $11.27 $11.17
-----------------------------------------------------------------------------------------------------------
TOTAL RETURN
(excluding account fees) (a) 18.63% 12.85% (4.43)% 3.34% 20.72% 17.10% 12.20%
Ratios to Average Net
Assets (b):
Net investment income (loss) (.37)% (.05)% (.14)% .23% .09% 1.30% 2.36%
Total expenses 2.25% 2.17% 2.06% 1.76% 1.97% 2.10% 1.98%
Expenses reimbursed or offset (.02)% -- -- -- (.09)% (.60)% (.48)%
Net expenses 2.23% 2.17% 2.06% 1.76% 1.88% 1.50% 1.50%
Portfolio turnover rate 168% 76% 51% 13% 62% 115% 163%
Net assets, end of period (in
thousands) $17,622 $17,453 $20,740 $25,492 $25,160 $27,945 $32,976
(*) For the four months ended October 31, 1997.
(**) Effective November 18, 1996, the Fund changed to a new investment manager.
(a) Total returns for period less than one year are not annualized.
(b) Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as discussed in
the notes to the financial statements. These amounts would decrease the
net investment income ratio had such reductions not occurred.
</TABLE>
43
<PAGE>
<TABLE>
-------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
-------------------------------------------------------------------------------------------------------
REGENT EASTERN EUROPEAN FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE:
<CAPTION>
SIX MONTHS YEAR ENDED
ENDED OCTOBER 31, YEAR ENDED
APRIL 30, ------------------ OCT. 31,
2000 1999 1998 1997 (*)
<S> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD $8.66 $8.02 $11.19 $10.00
-------------------------------------------------------------------------------------------------------
Investment Activities
Net investment loss (.22) (.23) (.27) (.01)
Net realized and unrealized gain (loss) 2.93 .87 (2.84) 1.20
------ ------ ------ ------
Total from investment activities 2.71 .64 (3.11) 1.19
------ ------ ------ ------
Distributions
From net investment income -- -- -- --
In excess of net investment income -- -- (.01) --
From net realized gains -- -- -- --
In excess of net realized gains -- -- (.05) --
------ ------ ------ ------
Total distributions -- -- (.06) --
-------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $11.37 $8.66 $8.02 $11.19
-------------------------------------------------------------------------------------------------------
TOTAL RETURN
(excluding account fees) (a) 31.29% 7.98% (27.96)% 11.90%
Ratios to Average Net Assets (b):
Net investment loss (3.57)% (2.38)% (2.38)% (.49)%
Total expenses 4.19% 4.36% 5.03% 4.98%
Expenses reimbursed or offset -- (.01)% (.48)% (1.73)%
Net expenses 4.19% 4.35% 4.55% 3.25%
Portfolio turnover rate 41% 29% 97% 11%
Net assets, end of period (in thousands) $5,920 $5,210 $5,676 $8,778
(*) From March 31, 1997, commencement of operations.
(a) Total return for periods less than one year are not annualized.
(b) Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as discussed in
the notes to the financial statements. These amounts would decrease the net
investment income ratio had such reductions not occurred.
</TABLE>
44
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