<PAGE>
SEMI-ANNUAL REPORT, June 30, 1997
NAVELLIER SERIES FUND
1 East Liberty, Third Floor
Reno, NV 89501
(800) 887-8671
- --------------------------------------------------------------------------------
August 20, 1997
Dear Shareholder:
For the first two quarters of 1997, the Navellier Series Fund, Aggressive Small
Cap Equity Portfolio (the "Fund") gained 1.52% (lost (1.53)% after the maximum
load of 3%)* compared to the NASDAQ Composite** which was up 11.7% and the
Lipper Small Company Index*** which was up 6.04% over the same period. Since
initial public offering (April 1, 1994) the Fund has a total return of 92.55%
(86.72% after the maximum load of 3%) compared to 93.97% for the NASDAQ
Composite over the same period. The annualized return for the Fund since
inception is 22.33% (21.18% after the maximum load of 3%) compared to 22.61% for
the NASDAQ Composite over the same period.
During the first half of the year the NASDAQ Composite has been dominated by the
100 largest capitalization NASDAQ stocks, such as Intel and Microsoft, which
have performed spectacularly during the first half of 1997. Unfortunately, due
to the small capitalization bias for the Navellier Aggressive Small Cap Equity
Portfolio, we did not own Intel or Microsoft or hardly any of the top 100
largest capitalization NASDAQ stocks.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
<S> <C> <C> <C>
NASDAQ Composite Small Cap Portfolio Russell 2000
3/31/94 $10,000 $10,000 $10,000
4/29/94 $9,871 $10,229 $10,059
5/31/94 $9,889 $9,750 $9,929
6/30/94 $9,496 $9,521 $9,571
7/29/94 $9,714 $9,719 $9,721
8/31/94 $10,298 $9,906 $10,249
9/30/94 $10,280 $10,427 $10,202
10/31/94 $10,458 $10,770 $10,158
11/30/94 $10,092 $10,957 $9,729
12/30/94 $10,114 $11,426 $9,972
1/31/95 $10,158 $10,562 $9,832
2/28/95 $10,676 $11,124 $10,219
3/31/95 $10,992 $11,655 $10,387
4/28/95 $11,352 $12,258 $10,602
5/31/95 $11,629 $12,341 $10,764
6/30/95 $12,555 $14,048 $11,297
7/31/95 $13,467 $16,306 $11,938
8/31/95 $13,721 $15,682 $12,161
9/29/95 $14,036 $16,514 $12,363
10/31/95 $13,936 $15,619 $11,800
11/30/95 $14,247 $16,348 $12,291
12/29/95 $14,152 $16,035 $12,585
1/31/96 $14,255 $15,481 $12,562
2/29/96 $14,796 $16,760 $12,942
3/29/96 $14,815 $18,007 $13,175
4/30/96 $16,013 $21,280 $13,872
5/31/96 $16,725 $22,816 $14,413
6/28/96 $15,939 $20,971 $13,806
7/31/96 $14,535 $17,656 $12,587
8/30/96 $15,354 $18,839 $13,299
9/30/96 $16,503 $20,321 $13,797
10/31/96 $16,430 $19,308 $13,565
11/29/96 $17,386 $19,287 $14,105
12/31/96 $17,365 $18,967 $14,443
1/31/97 $18,560 $18,935 $14,716
2/28/97 $17,607 $17,165 $14,341
3/31/97 $16,433 $16,014 $13,645
4/30/97 $16,958 $16,024 $13,662
5/30/97 $18,835 $18,114 $15,166
6/30/97 $19,397 $19,255 $15,788
</TABLE>
The above chart indicates the return of $10,000 invested in the NAVELLIER
AGGRESSIVE SMALL CAP EQUITY PORTFOLIO on April 1, 1994. As the chart shows by
June 30, 1997, the value of the investment would have grown to $19,255, a 92.55%
increase. For comparison purposes, look at how the NASDAQ Composite and the
Russell 2000 performed over the same period. An investment of $10,000 in the
NASDAQ Composite over the same period would have grown to $19,397, a 93.97%
increase. Similarly an investment of $10,000 in the Russell 2000 over the same
period would have grown to $15,788, a 57.88% increase.
The above charts and performance numbers assume reinvestment of all
distributions.
Please be aware that past performance is no indication of future performance.
The investment return and principal value of an investment will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than their
original cost.
<PAGE>
Investor optimism became even more bullish during the second quarter of 1997 due
to the excellent economic environment. The U.S. economy has cooled off quickly
from its torrid pace in the first quarter (5.9% annual GNP growth). During the
first six months of 1997, wholesale prices have fallen dramatically, their
largest decrease in 45 years. Retail sales fell for three consecutive months,
lending further support to the widespread opinion that the Federal Reserve Board
will not raise interest rates in the near future.
The small-to-mid capitalization sector of the stock market really started to
perk up in May 1997 and has performed spectacularly since then. Prior to May
1997, large capitalization stocks had grossly outperformed small-to-mid
capitalization stocks because investors were in love with liquidity. However,
since May 1997, NASDAQ trading volume has surged and small-to-mid capitalization
stocks are exhibiting tremendous relative strength and should continue to
outperform large capitalization stocks, provided that NASDAQ trading volume
remains strong. One of the reasons why small-to-mid capitalization stocks
performed well in May 1997 was due to the fact that the breadth and power of the
S&P 500 started to deteriorate due to forecasts of decelerating earnings
momentum for the S&P 500. In addition, the fundamentals of the small caps
remained more attractive than the large caps as evidenced by the relatively high
price/earnings ratios of the S&P 500 and Dow Industrials.
These forecasts of deteriorating earnings momentum have come to fruition, and
now the S&P 500 is undergoing a correction. We expect that the current
correction will be rotational in nature where one industry group gets "hit" and
another industry group "rallies". Our favorite NASDAQ stocks have been
exhibiting tremendous relative strength while the S&P 500 has been suffering
during the current correction. Most small-to-mid capitalization stocks have not
rallied anywhere near as much as their large capitalization counterparts during
the past year, so we expect that our small-to-mid capitalization mutual funds
will be vulnerable in the upcoming weeks. Furthermore, our small-to-mid
capitalization stocks have superior earnings growth relative to their large
capitalization counterparts and should be inherently more resilient during a
correction. When all the dust settles and the current rotational correction
ends, we expect that many of our favorite small-to-mid capitalization stocks
will emerge as the new stock market leaders. We are especially excited about the
prospects for our small-to-mid capitalization stocks for the remainder of 1997,
since on a growth-to-price multiple basis, our stocks are undervalued by
historical standards.
We are proud to announce that on July 15, 1997, Navellier Management Inc.
regained control of the Navellier Aggressive Small Cap Equity Fund (NASCX) that
had been temporarily managed by Massachusetts Financial Services (MFS) for 120
days. The Fund has resumed trading under its old name and ticker symbol (NASCX).
The independent trustees that opposed our proposed merger proxy and assigned the
management contract of the Fund to MFS last March, promptly resigned after
awarding the management contract to Navellier last month. We want to publicly
thank our loyal shareholders who overwhelmingly supported us in connection with
the proxy battle to regain control of the Fund. This whole fight was about
whether or not Navellier should be load or no-load. Obviously, Navellier wanted
to be no-load, because that is what our shareholders wanted. We regret that the
independent trustees of the Navellier Aggressive Small Cap Equity Fund failed to
agree with us on this issue. Navellier is proceeding with its original proxy
proposal to merge the Navellier Aggressive Small Cap Equity Fund into the
Navellier Performance Fund family so we can reduce shareholder expenses and can
offer the subject fund in more mutual fund supermarkets, where investors can buy
and sell both load and no-load mutual funds without any sales charges. Although
the discount brokerage firms now dominate the mutual fund supermarket business,
we will soon see many full-service brokerage firms introducing their own mutual
fund supermarkets. We sincerely appreciate all your help and support during the
proxy battle.
2
<PAGE>
Always feel free to contact us if you have any questions or if we can help you
in any way.
Sincerely,
[SIGNATURE]
LOUIS G. NAVELLIER
THIS MATERIAL HAS BEEN PRECEDED BY A NAVELLIER AGGRESSIVE SMALL CAP EQUITY FUND
PROSPECTUS.
* DURING THE PERIOD BEGINNING MARCH 16, 1997 AND ENDING JULY 14, 1997 THE FUND
WAS MANAGED BY MASSACHUSETTS FINANCIAL SERVICES.
** THE NASDAQ COMPOSITE IS AN UNMANAGED INDEX CONSISTING OF APPROXIMATELY 5,500
STOCKS. IT IS CONSIDERED REPRESENTATIVE OF THE STOCK MARKET AS A WHOLE. IT
IS NOT AN INVESTMENT PRODUCT AVAILABLE FOR PURCHASE.
*** THE LIPPER SMALL COMPANY INDEX IS AN UNMANAGED NET ASSET VALUE WEIGHTED
INDEX OF 30 MUTUAL FUNDS THAT INVEST PRIMARILY IN COMPANIES THAT HAVE SMALL
MARKET CAPITALIZATIONS.
3
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
- -------------------------------------------------------
<C> <S> <C>
MARKET VALUE
SHARES (NOTE 1)
<CAPTION>
- -------------------------------------------------------
<C> <S> <C>
COMMON STOCKS -- 97.71%
OF TOTAL INVESTMENTS
AEROSPACE -- 1.34%
45,000 GenCorp, Inc. $ 1,040,625
-------------
AIRLINES -- 2.56%
7,500 Atlas Airlines, Inc.* 258,750
117,500 Mesaba Holdings, Inc.* 1,733,125
-------------
1,991,875
-------------
APPAREL & TEXTILES -- 0.16%
3,600 Budget Group, Inc.* 124,200
-------------
AUTOMOTIVE -- 0.72%
16,000 Carlisle Companies, Inc. 558,000
-------------
BANKS & CREDIT COMPANIES -- 3.86%
10,000 Andover Bancorp, Inc. 303,750
30,000 City National Corp. 721,875
39,000 Commercial Bank of New York 706,875
25,000 Interra Financial, Inc. 1,048,437
4,500 TCF Financial Corp. 222,188
-------------
3,003,125
-------------
BIOTECHNOLOGY -- 0.84%
52,900 Idexx Laboratories, Inc.* 657,944
-------------
BUILDING -- 2.05%
14,000 Lone Star Industries, Inc. 634,375
25,000 Medusa Corp. 959,375
-------------
1,593,750
-------------
BUSINESS MACHINES -- 1.46%
40,500 Affiliated Computer Services
Co.* 1,134,000
-------------
BUSINESS SERVICES -- 13.06%
60,700 AFC Cable Systems, Inc.* 1,638,900
45,200 APAC Teleservices, Inc.* 878,575
36,300 AccuStaff, Inc.* 859,856
14,600 BDM International, Inc.* 335,800
14,100 BISYS Group, Inc.* 588,675
800 Carey International, Inc.* 12,200
16,800 Claremont Technology Group,
Inc.* 399,000
<CAPTION>
- -------------------------------------------------------
MARKET VALUE
SHARES (NOTE 1)
- -------------------------------------------------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
BUSINESS SERVICES (CONTINUED)
19,300 DST Systems, Inc.* $ 642,931
18,200 Danka Business Systems, Inc. 743,925
15,600 Dendrite International Inc.* 257,400
15,200 Equity Corp. International* 367,650
17,800 Interim Services, Inc.* 792,100
35,800 May & Speh, Inc.* 483,300
28,900 PMT Services, Inc.* 440,725
10,900 Personnel Group America,
Inc.* 314,056
20,000 Service Experts, Inc.* 490,000
500 Strayer Education, Inc. 19,000
14,600 Technology Solutions Co.* 576,700
10,000 Transaction Systems
Architects* 345,000
-------------
10,185,793
-------------
CHEMICALS -- 1.52%
21,500 H.B. Fuller Co. 1,182,500
-------------
COMPUTER SOFTWARE --
PERSONAL COMPUTERS -- 1.53%
10,300 Apex PC Solutions, Inc.* 203,425
30,000 P-Com, Inc.* 990,000
-------------
1,193,425
-------------
COMPUTER SOFTWARE -- SYSTEMS -- 8.85%
17,500 American Business
Information, Inc.* 380,625
9,200 Black Box Corp.* 370,300
25,300 Cadence Design Systems, Inc.* 847,550
28,500 Clarify, Inc.* 322,406
20,400 Compuware Corp.* 974,100
16,900 Control Data Systems, Inc.* 251,388
40,800 Daou Systems, Inc.* 652,800
7,700 HNC Software, Inc.* 293,563
5,500 JDA Software Group* 187,687
600 LHS Group, Inc.* 26,287
14,700 Pure Atria Corp.* 207,637
14,700 Simulation Sciences, Inc.* 224,175
26,600 Sterling Software, Inc.* 831,250
15,700 USCS International, Inc.* 514,175
1,700 Vantive Corp.* 48,025
7,400 Viasoft, Inc.* 375,550
</TABLE>
* NON-INCOME PRODUCING.
SEE NOTES TO FINANCIAL STATEMENTS.
4
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (CONTINUED)
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
- -------------------------------------------------------
MARKET VALUE
SHARES (NOTE 1)
- -------------------------------------------------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
COMPUTER SOFTWARE -- SYSTEMS (CONTINUED)
26,100 Xionics Document
Technologies* $ 384,975
-------------
6,892,493
-------------
CONSUMER GOODS & SERVICES -- 2.65%
32,700 Alternative Resources Corp.* 666,262
11,850 Blyth Industries, Inc.* 399,937
7,100 Meta Group, Inc.* 154,425
7,600 Schweitzer-Mauduit
International 285,000
5,800 Signature Resorts, Inc.* 200,462
14,000 U.S. Rentals, Inc.* 354,375
-------------
2,060,461
-------------
DEFENSE ELECTRONICS -- 1.53%
35,000 Esco Electronics Corp.* 441,875
40,000 Engineered Support Systems,
Inc.* 750,000
-------------
1,191,875
-------------
ELECTRICAL EQUIPMENT -- 2.74%
10,400 Belden, Inc. 354,250
95,000 Zytec* 1,781,250
-------------
2,135,500
-------------
ELECTRONICS -- 7.19%
26,800 ACT Manufacturing, Inc.* 1,118,900
5,600 Actel Corp.* 95,550
14,300 Analog Devices, Inc.* 379,844
13,200 Burr Brown Corp.* 455,400
19,800 Hadco Corp.* 1,296,900
14,100 Kulicke & Softa Industries,
Inc.* 457,810
31,200 PMC-Sierra, Inc.* 819,000
6,200 Photromics, Inc.* 296,050
7,700 Triquint Semiconductor, Inc.* 264,688
18,100 Ultratech Steeper, Inc.* 414,038
-------------
5,598,180
-------------
ENTERTAINMENT -- 3.56%
17,500 American Radio Systems Corp.* 697,812
14,200 Argyle Television, Inc.* 362,100
<CAPTION>
- -------------------------------------------------------
MARKET VALUE
SHARES (NOTE 1)
- -------------------------------------------------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
ENTERTAINMENT (CONTINUED)
30,000 Funco, Inc.* $ 555,000
2,900 Heftel Broadcasting Corp. 160,225
16,300 Jacor Communications, Inc.* 623,475
20,300 Gemstar International Group
LT.* 373,013
-------------
2,771,625
-------------
FINANCIAL INSTITUTIONS -- 6.59%
50,000 Ace Cash Express, Inc.* 625,000
12,100 BA Merchant Services, Inc.* 230,656
5,800 Franklin Resources, Inc. 420,862
40,000 RCSB Financial, Inc. 1,915,000
35,000 Southwest Securities Group,
Inc. 682,500
50,000 T R Financial Corp. 1,259,375
-------------
5,133,393
-------------
FOOD & BEVERAGE PRODUCTS -- 0.51%
9,700 Suiza Foods Corp.* 397,700
-------------
FOREST & PAPER PRODUCTS -- 1.80%
67,000 Fibremark, Inc.* 1,398,625
-------------
INSURANCE -- 0.74%
40,000 Dynex Capital, Inc. 557,500
600 Hartford Life, Inc.* 22,500
-------------
580,000
-------------
MACHINERY -- 3.87%
35,000 Gehl Co.* 586,250
30,000 Graco, Inc. 903,750
15,500 Greenfield Industries, Inc. 418,500
7,000 Lincoln Electric Co. 245,000
22,500 Zoltek Companies, Inc.* 860,625
-------------
3,014,125
-------------
MEDICAL & HEALTH PRODUCTS -- 0.40%
11,200 Kos Pharmaceuticals, Inc.* 310,800
-------------
MEDICAL & HEALTH TECHNOLOGY
& SERVICES -- 7.37%
16,400 Amerisource Health Corp.* 817,950
8,800 CRA Managed Care, Inc.* 459,250
</TABLE>
* NON-INCOME PRODUCING.
SEE NOTES TO FINANCIAL STATEMENTS.
5
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (CONTINUED)
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
- -------------------------------------------------------
MARKET VALUE
SHARES (NOTE 1)
- -------------------------------------------------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
MEDICAL & HEALTH TECHNOLOGY
& SERVICES (CONTINUED)
13,700 Hologic, Inc.* $ 364,762
39,000 Horizon / CMS Healthcare
Corp.* 782,438
11,000 IDX Systems Corp.* 379,500
9,500 Medicis Pharmaceutical Corp.* 473,813
9,300 Quorum Health Group, Inc.* 332,475
15,300 Renal Treatment Center* 411,187
10,400 Steris Corp.* 388,700
10,100 Total Renal Care Holdings,
Inc.* 405,894
95,000 Westbridge Capital Corp.* 920,313
-------------
5,736,282
-------------
OIL SERVICES -- 1.29%
13,600 Cooper Cameron Corp.* 635,800
25,000 Plains Resources, Inc.* 368,750
-------------
1,004,550
-------------
OILS -- 0.05%
1,100 Santa Fe International, Inc. 37,400
-------------
RAILROAD -- 1.49%
31,100 Wisconsin Central
Tranportation* 1,158,475
-------------
REAL ESTATE -- 4.16%
50,000 Fairfield Communities, Inc.* 1,681,250
40,000 First American Financial
Corp. 1,560,000
-------------
3,241,250
-------------
RESTAURANTS & LODGING -- 2.36%
12,500 Applebees International, Inc. 334,375
8,900 Doubletree Corp.* 366,013
16,100 Outback Steakhouse, Inc.* 389,419
2,600 Papa Johns International,
Inc.* 95,550
32,900 Prime Hospitality Corp.* 649,775
-------------
1,835,132
-------------
SPECIAL PRODUCTS & SERVICES -- 4.79%
65,000 Barnes Group, Inc. 1,925,625
14,500 Catalina Marketing Corp.* 697,813
<CAPTION>
- -------------------------------------------------------
MARKET VALUE
SHARES (NOTE 1)
- -------------------------------------------------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
SPECIAL PRODUCTS & SERVICES (CONTINUED)
31,000 DT Industries, Inc. $ 1,108,250
-------------
3,731,688
-------------
STEEL -- 0.90%
30,000 Carbide / Graphite Group,
Inc.* 697,500
-------------
STORES -- 3.93%
33,200 Corporate Express, Inc.* 479,327
15,300 Gymboree Corp.* 367,200
11,200 Hollywood Entertainment
Corp.* 256,200
14,500 Mazel Stores, Inc.* 253,750
35,000 Micro Warehouse, Inc.* 599,375
30,000 Paul Harris Stores, Inc.* 502,500
13,400 Petco Animal Supplies, Inc.* 402,000
6,500 U.S. Office Products Co.* 198,656
-------------
3,059,008
-------------
TELECOMMUNICATIONS -- 1.84%
17,200 Aspect Telecommunications
Corp.* 382,700
14,500 Brooks Fiber Properties,
Inc.* 489,375
16,100 Cable Design Technologies
Corp.* 473,944
7,900 VDI Media* 88,875
-------------
1,434,894
-------------
TOTAL COMMON STOCK
(COST $64,205,180) 76,086,193
-------------
REPURCHASE AGREEMENTS -- 2.29%
With PaineWebber at 5.85%, dated
6/30/97, due 7/1/97, collateralized by
$1,789,000 U.S. Treasury Notes, 5.75%,
due 9/30/97. Proceeds at maturity are
$1,781,289. (Cost $1,781,000) 1,781,000
-------------
TOTAL INVESTMENTS -- 100.00%
(COST $65,986,180) $ 77,867,193
-------------
-------------
</TABLE>
* NON-INCOME PRODUCING.
SEE NOTES TO FINANCIAL STATEMENTS.
6
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<S> <C>
ASSETS
Securities at Value (Note 1) (Cost $65,986,180)........................................ $77,867,193
Cash in Custodian Bank................................................................. 7,708
Receivable for Securities Sold......................................................... 389,730
Receivable for Shares Sold............................................................. 17,459
Dividends Receivable................................................................... 23,485
Interest Receivable.................................................................... 289
Unamortized Organizational Costs (Note 1).............................................. 2,686
-----------
Total Assets......................................................................... 78,308,550
-----------
LIABILITIES
Payable for Shares Redeemed............................................................ 391,719
Investment Advisory Fee Payable (Note 2)............................................... 162,414
Extraordinary Expenses Payable......................................................... 136,362
Payable for Securities Purchased....................................................... 111,089
Administrative Fee Payable (Note 2).................................................... 32,483
Other Payables and Accured Expenses.................................................... 15,762
Commissions Payable.................................................................... 7,004
Organizational Expenses Payable to Adviser (Note 1).................................... 2,686
-----------
Total Liabilities.................................................................... 859,519
-----------
NET ASSETS............................................................................... $77,449,031
-----------
-----------
SHARES OUTSTANDING....................................................................... 4,288,209
-----------
-----------
NET ASSET VALUE PER SHARE................................................................ $18.06
-----------
-----------
MAXIMUM OFFERING PRICE PER SHARE (100/97 of $18.06)...................................... $18.62
-----------
-----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
7
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED
JUNE 30, 1997 (UNAUDITED)
<TABLE>
<S> <C>
INVESTMENT INCOME
Interest (Note 1)..................................................................... $ 233,933
Dividends (Note 1).................................................................... 394,918
------------
Total Investment Income............................................................. 628,851
------------
EXPENSES
Investment Advisory Fee (Note 2)...................................................... 759,717
Extraordinary Expenses (Note 2)....................................................... 417,516
Administrative Fee (Note 2)........................................................... 151,944
Transfer Agent and Custodian Fee (Note 3)............................................. 128,832
Legal Fees............................................................................ 62,482
Registration Fees..................................................................... 56,375
Proxy Solicitation Expenses........................................................... 43,234
Shareholder Reports and Notices....................................................... 40,875
Audit Fees............................................................................ 22,100
Trustees' Fees and Expenses (Note 2).................................................. 21,150
Organizational Expense (Note 1)....................................................... 2,125
Other Expenses........................................................................ 22,210
------------
Total Expenses...................................................................... 1,728,560
Less Expenses Reimbursed by Investment Adviser (Note 2)............................. (247,439)
------------
Net Expenses...................................................................... 1,481,121
------------
NET INVESTMENT LOSS..................................................................... (852,270)
------------
Net Realized Gain on Investments........................................................ 13,671,730
Net Change in Unrealized Appreciation of Investments.................................... (24,997,071)
------------
NET LOSS ON INVESTMENTS................................................................. (11,325,341)
------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS.................................... $(12,177,611)
------------
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED
JUNE 30, 1997 (UNAUDITED) DECEMBER 31, 1996
-------------------------- -------------------
<S> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Loss........................................... $ (852,270) $ (2,477,826)
Net Realized Gain on Investment Transactions.................. 13,671,730 463,797
Net Change in Unrealized Appreciation Depreciation of
Investments................................................. (24,997,071) 18,466,247
--------------- -------------------
Net Increase (Decrease) in Net Assets Resulting from
Operations................................................ (12,177,611) 16,452,218
--------------- -------------------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares............................. 46,540,394 286,125,562
Cost of Shares Redeemed....................................... (146,948,265) (217,842,421)
--------------- -------------------
Net Increase (Decrease) in Net Assets Resulting from Share
Transactions.............................................. (100,407,871) 68,283,141
--------------- -------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS..................... (112,585,482) 84,735,359
NET ASSETS -- Beginning of Period............................... 190,034,513 105,299,154
--------------- -------------------
NET ASSETS -- End of Period..................................... $ 77,449,031 $ 190,034,513
--------------- -------------------
--------------- -------------------
SHARES
Sold.......................................................... 2,713,978 16,325,181
Redeemed...................................................... (9,108,773) (12,473,362)
--------------- -------------------
Net Increase (Decrease) in Shares........................... (6,394,795) 3,851,819
--------------- -------------------
--------------- -------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE SIX
MONTHS ENDED FOR THE YEAR ENDED DECEMBER FOR THE
JUNE 30, 31, PERIOD ENDED
1997 --------------------------- DECEMBER 31,
(UNAUDITED) 1996 1995 1994*
------------ ---------- ---------- ------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of Period.... $ 17.79 $ 15.41 $ 10.98 $ 10.00
------------ ---------- ---------- ------------
Income from Investment Operations:
Net Investment Loss..................... (0.20) (0.23) (0.16) (0.08)
Net Realized and Unrealized
Gains on Securities................... 0.47(D) 2.61 4.97 1.06
------------ ---------- ---------- ------------
Total from Investment Operations...... 0.27 2.38 4.81 0.98
------------ ---------- ---------- ------------
Distributions to Shareholders:
From Net Realized Capital Gains......... -- -- (0.38) --
------------ ---------- ---------- ------------
Net Increase in Net Asset Value........... 0.27 2.38 4.43 0.98
------------ ---------- ---------- ------------
Net Asset Value -- End of Period.......... $ 18.06 $ 17.79 $ 15.41 $ 10.98
------------ ---------- ---------- ------------
------------ ---------- ---------- ------------
TOTAL INVESTMENT RETURN(A) ............... 1.52% 15.44% 43.80% 9.80%
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note 2)..... 2.44%(B) 1.75% 1.75% 1.68%(B)
Expenses Before Reimbursement (Note 2).... 2.84%(B) 1.86% 2.10% 4.52%(B)
Net Investment Loss....................... (1.40)%(B) (1.33)% (1.15)% (0.81)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate................... 54.7% 136.9% 169.6% 139.9%
Net Assets at End
of Period (000's omitted)............... $77,449 $190,035 $105,299 $18,224
Number of Shares Outstanding
at End of Period (000's omitted)........ 4,288 10,683 6,831 1,660
Average Commission Rate Paid(C)........... $0.0414 $0.0424 -- --
</TABLE>
- -------------------------------------------
(A) Total returns do not include the maximum sales load. Total returns for
periods of less than one year are not annualized.
(B) Annualized.
(C) For fiscal years beginning on or after September 1, 1995, a fund is required
to disclose its average commission rate per share for security trades on
which commissions are charged. This amount may vary from period to period
and fund to fund depending on the mix of trades executed in various markets
where trading practices and commission rate structures may differ.
(D) The per share amount is not in accordance with the net realized and
unrealized loss for the period because of the timing of sales of Fund shares
and the amount of per share realized and unrealized gains and losses at such
time.
*FROM COMMENCEMENT OF OPERATIONS JANUARY 3, 1994.
SEE NOTES TO FINANCIAL STATEMENTS.
10
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NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997 (UNAUDITED)
1. Significant Accounting Policies
Navellier Series Fund (the "Fund") is registered with the Securities and
Exchange Commission under the Investment Company Act of 1940 as a diversified,
open-end investment company. The Fund consists of one portfolio, Navellier
Aggressive Small Cap Equity Portfolio (the "Portfolio"), known as the MFS
Aggressive Small Cap Equity Fund from March 16, 1997 to July 14, 1997. Shares of
the Fund are purchased at the public offering price which includes a maximum
sales charge of up to 3% depending on the size of the purchase. The Fund is
authorized to issue an unlimited number of shares of capital stock with no
stated par value. The financial statements have been prepared in conformity with
generally accepted accounting principles which permit management to make certain
estimates and assumptions at the date of the financial statements. The following
is a summary of significant accounting policies which the Fund follows:
(a) Listed securities are valued at the last sales price on the New York
Stock exchange and other major exchanges. Over-the-Counter securities are
valued at the last sales price. Short-term obligations, which mature in 60
days or less, are valued at amortized cost, which approximates value.
Securities for which there are no such quotations or valuations are valued at
fair value in good faith by or at the direction of the Trustees.
(b) Security transactions are recorded on the trade date (the date the
order to buy or sell is executed). Interest income is accrued on a daily
basis. Dividend income is recorded on the ex-dividend date. Realized gains or
losses from securities transactions are computed on an identified cost basis.
(c) Dividends, if any, from net investment income are declared and paid
annually. Dividends are reinvested in additional shares unless shareholders
request payment in cash. Net capital gains, if any, are distributed annually.
(d) The Fund may enter into repurchase agreements with institutions that
the Fund's investment adviser has deemed creditworthy. Each repurchase
agreement is recorded at cost. The Fund requires that the securities purchased
in a repurchase agreement be transferred to the custodian in a manner
sufficient to enable the Fund to obtain those securities in the event of a
default under the repurchase agreement. The Fund monitors, on a daily basis,
the value of the securities transferred to ensure the value, including the
accrued interest, of the securities under each repurchase agreement is greater
than the amounts owed to the Fund.
(e) The Fund intends to comply with the provisions of the Internal Revenue
Code applicable to regulated investment companies and distributes all net
investment income to its shareholders. Therefore, no Federal income or excise
tax provision is required.
(f) Organizational expenses of the Fund totaling $143,294 are being
deferred and amortized over 60 months beginning with the public offering of
shares. Any redemption by an initial shareholder during the amortization
period will be reduced by the pro rata portion of any of the unamortized
organization expenses. Such proration is calculated by dividing the number of
initial shares redeemed by the number of initial shares outstanding at the
date of the redemption. During the six month period ended June 30, 1997, the
initial investor redeemed a portion of the initial shares. At June 30, 1997,
unamortized organization costs were $2,686.
2. Investment Advisory Fees and Other Transactions with Affiliates
INVESTMENT ADVISER
For the period from January 1, 1997 to March 15, 1997, investment advisory
services and administrative services were provided by Navellier Management, Inc.
("Navellier"). From March 16, 1997 to June 30, 1997, investment advisory
services and administrative service were provided by Massachusetts Financial
Services Company ("MFS"). The advisory fee paid to Navellier and to MFS for
investment advisory services was 1.25% of the daily net assets on an
11
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
annual basis. Navellier and MFS received 0.25% of the daily net assets on an
annual basis for administrative services provided to the Fund. Navellier and MFS
also received reimbursement for certain operating expenses incurred on behalf of
the Fund, as more fully described below. Certain Directors and officers of
Navellier served as Trustees of the Fund during the period from January 1, 1997
to March 15, 1997. A Director of MFS served as a Trustee of the Fund from March
16, 1997 through June 18, 1997, when he resigned, and certain officers of MFS
served as officers of the Fund from March 16, 1997 to June 30, 1997.
Prior to March 15, 1997 under an agreement between the Fund and Navellier
related to the payment of the Fund's operating expenses, Navellier reserved the
right to request reimbursement for past, present and future operating expenses
of the Fund paid by Navellier at any time upon notice to the Fund. Navellier
voluntarily agreed not to seek future reimbursement of all past expenses which
had not been reimbursed at December 31, 1996. For the period from March 16, 1997
to June 30, 1997 MFS agreed to bear the Fund's normal operating expenses,
subject to reimbursement by the Fund. The expense reimbursement arrangement with
MFS does not include extraordinary Fund expenses, such as litigation-related
expenses or any expenses which were borne or accrued prior to March 16, 1997.
During the period March 16, 1997 to June 30, 1997, the Fund incurred $417,516 in
extraordinary expenses in connection with litigation, proxy solicitation and
proxy certification expenses incurred above the normal expense of holding a
routine shareholder meeting, and administrative expenses related to the transfer
of the investment advisory contract and the administrative services contract
from Navellier to MFS.
Under the operating expense agreement between Navellier and the Fund from
January 1, 1997 to March 15, 1997 and the operating expense agreement between
MFS and the Fund from March 16, 1997 to June 30, 1997, the following amounts
were paid or incurred, based on a reimbursement rate of 0.25% of the daily net
assets on an annual basis for the respective periods. Amounts paid or incurred,
amounts reimbursed and amounts not reimbursed at June 30, 1997, for Navellier
and MFS are disclosed below.
<TABLE>
<CAPTION>
NAVELLIER MFS
--------- ---------
<S> <C> <C>
Operating expenses incurred............................................................... $ 184,421 $ 214,962
Amounts reimbursed........................................................................ 89,969 61,975
--------- ---------
Unreimbursed amounts...................................................................... $ 94,452 $ 152,987
--------- ---------
--------- ---------
Amount subject to request for reimbursement............................................... $ 94,452 $ 152,987
Amount subject to reimbursement which has been waived by the investment adviser........... $ 94,452 $ 152,987
</TABLE>
DISTRIBUTOR
For the period from January 1, 1997 to March 15, 1997, Navellier Securities
Corp. ("NSC") acted as the Fund's distributor pursuant to a distribution
agreement with the Fund. During this period an officer and Trustee of the Fund
also was an officer and Director of NSC. For the period from March 16, 1997 to
June 30, 1997, MFS Funds Distributor, Inc. ("MFD") acted as the Fund's
distributor pursuant to a distribution agreement with the Fund. A Trustee of the
Fund was also a Director of MFD. For the semiannual period ended June 30, 1997,
NSC and MFD received $40,154 and $25,314, respectively, as the portion of sales
charges on sales of shares of the Fund.
TRUSTEES
The Fund pays each of its Trustees not affiliated with the Adviser a fee of
$10,000 annually plus specific amounts for attended board and committee
meetings. When the Fund exceeds $200,000,000 in total net assets, then the
Trustees' fee is raised to $20,000 annually. For the period ended June 30, 1997
Trustees' fees and expenses totaled $21,150.
12
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
3. Transfer Agent and Custodian
Rushmore Trust and Savings, FSB, ("Rushmore Trust") provides transfer
agency, dividend disbursing and other shareholder services to the Fund. In
addition, Rushmore Trust serves as custodian of the Fund's assets. Fees paid to
Rushmore Trust are based on a fee schedule approved by the Board of Trustees.
4. Securities Transactions
For the six months ended June 30, 1997, purchases and sales of investments,
other than short-term obligations, totaled $62,865,540 and $108,743,765,
respectively.
5. Net Unrealized Appreciation/Depreciation of Investments
At June 30, 1997, net appreciation of investments for Federal income tax
purposes was $11,722,909 of which $12,685,935 related to appreciated investments
and $963,026 related to depreciated investments. At June 30, 1997, the cost of
the Fund's securities for Federal income tax purposes was $66,144,284.
6. Net Assets
At June 30, 1997 net assets consisted of the following:
<TABLE>
<S> <C>
Paid-in-capital......................................................................... $54,658,760
Undistributed net investment loss....................................................... (852,270)
Accumulated net realized gain on investments............................................ 11,761,528
Net unrealized appreciation on investments.............................................. 11,881,013
-----------
NET ASSETS.............................................................................. $77,449,031
-----------
-----------
</TABLE>
7. Tax Matters and Distributions
The Fund's policy is to comply with the provisions of the Internal Revenue
Code (the "Code") applicable to regulated investment companies and to distribute
to shareholders all of its net investment income, if any, including any realized
gain on investments. Accordingly, no provision for Federal income or excise tax
is provided. The Fund files a tax return annually using tax accounting methods
required under provisions of the Code which may differ from generally accepted
accounting principles, the basis on which these financial statements are
prepared. Accordingly, the amount of net investment income and net realized gain
reported on these financial statements may differ from those reported on the
Fund's tax return and, consequently, the character of distributions to
shareholders, if any, reported in the financial highlights may differ from that
reported to shareholders on Form 1099-DIV. Distributions to shareholders, if
any, are recorded on the Fund's records on the ex-dividend date.
Permanent differences between tax and financial reporting of net investment
income and realized gains or losses are reclassified to paid-in-capital. As of
December 31, 1996, net investment losses of $2,477,826 were reclassified to
paid-in-capital.
At December 31, 1996, for Federal income tax purposes, the Fund had a
capital loss carryover totaling $1,910,202 which may be applied against future
net taxable gains of each succeeding year until the earlier of its utilization
or its expiration date, which at December 31, 1996 was December 31, 2004.
13
<PAGE>
NAVELLIER AGGRESSIVE SMALL CAP EQUITY PORTFOLIO
- ------------------------------------------------------------------
8. Subsequent Events
On July 14, 1997, the Trustees of the Fund re-appointed Navellier
Management, Inc. investment adviser and administrator to the Fund at
substantially the same fees of 1.25% and 0.25% of daily net assets,
respectively, as had been in effect prior to March 16, 1997. Navellier
Securities Corp. was also re-appointed as distributor to the Fund. On July 11,
1997, a Director of Navellier was appointed a Trustee and officer of the Fund.
On or prior to July 14, 1997, the unaffiliated Trustees of the Fund and the
Trustee and the officers of the Fund affiliated with MFS resigned.
14
<PAGE>
[PHOTO]
NAVELLIER
SERIES FUND
SEMI-ANNUAL REPORT
JUNE 30, 1997
NAVELLIER OFFICES:
ONE EAST LIBERTY THIRD FLOOR
RENO, NEVADA 89501
800-887-8671 P.S.T.
CUSTODIAN & TRANSFER AGENT:
RUSHMORE TRUST AND SAVINGS, FSB
4922 FAIRMONT AVENUE
BETHESDA, MD 20814
800-622-1386 E.S.T.
