THE ALGER |
RETIREMENT | MEETING THE CHALLENGE
FUND | OF INVESTING
ALGER GROWTH
RETIREMENT PORTFOLIO
ALGER SMALL CAP
RETIREMENT PORTFOLIO
ALGER MIDCAP GROWTH
RETIREMENT PORTFOLIO
ALGER CAPITAL APPRECIATION
RETIREMENT PORTFOLIO
SEMI-ANNUAL | APRIL 30, 1996
REPORT | (UNAUDITED)
<PAGE>
FELLOW SHAREHOLDERS: June 18, 1996
A YEAR-TO-DATE REVIEW
The first six months of the fiscal year have been extremely challenging and
volatile. On more than one occasion, we have experienced the financial markets'
equivalent of wind-shear. Despite the volatility, most of the major market
indices are significantly higher than they were at the beginning of the year
with NASDAQ leading the way, up 13.2% through the end of April. On the other
hand, the bond market has been exceedingly weak. The reason for market
conditions so far this year has been a dramatic change in perception about the
nature of the economy and a variety of unrelated, but perplexing economic
events.
As 1996 began, the conventional wisdom in the market was that the economy
was extremely weak, and consequently would require a series of Federal Reserve
actions to lower short-term rates in order to avoid a possible recession. This
view was predicated on the extremely lackluster economic conditions that existed
during the Christmas sale season. Retail sales, by all accounts, were anywhere
from slow to abysmal. As a result, the GDP, calculated by the new chain-linked
method, grew only 0.5% in the fourth quarter. The Federal Reserve responded
aggressively by lowering both the Fed Funds rate and the discount rate in
February, after having lowered rates 1/4 of one point on December 19. On January
1, the thirty-year long-bond was trading at 5.96% and the stock market's concern
was that earnings would be lower than expected. To a certain degree this
forecast proved accurate. Certain parts of the economy, specifically
semiconductors and other technology products, did pre-announce disappointing
results for the first quarter, continuing a trend which began in the fourth
quarter of 1995. Consequently, many stocks performed very poorly at the end of
the first quarter. Interestingly, the first quarter began with a surge in the
Dow and a lag in the smaller companies, presumably because the larger companies
represented a safe haven against weak economic conditions.
Whatever weakness existed in the economy when the year began was further
exacerbated by severe snow storms in January and a partial shutdown of the
Federal Government. Along the way, several events occurred that radically
altered the investment landscape. First, two key commodities - grains and
petroleum products - experienced accelerating price increases due in large part
to the weather which prevailed at the beginning of the year. Secondly, on March
10 the Labor Department announced that the economy created 705,000 new jobs in
February, a dramatic and unexpected surge in new job formation. This was an
enormous increase, even netted against the drop of 188,000 in January. These
data have been subsequently restated, but the net gain for the two months is
about the same.
These changes threw the bond market into a panic and temporarily altered
the outlook of the stock market. The view about economic events began to shift
at this point and people began to consider that:
a) The economy was stronger than they originally thought;
b) Inflation was becoming a problem; and
c) The Fed would no longer lower rates.
In early May, it was announced that the GDP in the first quarter had grown
2.8% (since restated to 2.3%). This completed the 180-degree turn in investors'
perception. By this time the bond market had dropped dramatically.
<PAGE>
LOOKING AHEAD
Throughout this period, we have been unwilling to accept the view,
prevalent in January and February, that the economy was heading toward a
recession. We are also not willing to accept the currently prevailing view that
the economy is extremely robust and will lead to exaggerated inflation followed
by increases in short-term interest rates sometime this summer.
There is, admittedly, some evidence to point to a stronger economy than we
had anticipated. Housing data, for example, remains robust despite the increase
in mortgage rates. Additionally, consumer spending and average income figures
were both up in April. Despite this strong economic data, there are still plenty
of signs that the economy is not on a tear. Durable goods, for example, fell in
April and gold, a good indicator of inflation, is flat on the year, having been
up over $400 an ounce earlier.
We also do not see any data which would lead to concerns of a higher level
of inflation. If anything, there has been a drop in commodity prices recently,
and other industrial measures do not show much stress in the economy.
It is important to note, however, that when the bond market was at its
worst, the stock market remained undervalued relative to the bond market. At the
same time, the stock market has also remained undervalued relative to short-term
interest rates. In all likelihood, this is why the stock market has remained
relatively strong and did not respond to the rapid rise in rates.
In conclusion, although the economy looks confusing, we see no reason to be
less than optimistic about the financial markets. We believe that the market is
going to remain challenging for the rest of the year, oscillating between fear
of recession and fear of inflation, with periods of intense sector rotations.
Against this background, we expect that fundamental analysis will win out.
Respectfully submitted,
/s/David D. Alger
David D. Alger
President
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER GROWTH RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Unaudited)
APRIL 30, 1996
SHARES COMMON STOCKS--91.3% VALUE
------ -----
AEROSPACE--2.0%
2,000 The Boeing Company ....................... $ 164,250
1,700 Sundstrand Corp. ......................... 62,475
-----------
226,725
-----------
ALUMINUM--.5%
900 Aluminum Co. of America .................. 56,137
-----------
APPAREL--1.6%
4,000 Tommy Hilfiger Corporation* .............. 182,000
-----------
BIO-TECHNOLOGY--2.5%
6,300 Biochem Pharma Inc.* ..................... 286,650
-----------
BUILDING & CONSTRUCTION--1.1%
6,725 Clayton Homes, Inc. ...................... 124,413
-----------
CHEMICALS--.5%
400 Monsanto Co. ............................. 60,600
-----------
COMMUNICATIONS--6.9%
3,400 America Online Inc.* ..................... 217,600
1,600 Ascend Communications, Inc.* ............. 98,400
3,000 Glenayre Technologies Inc.* .............. 139,500
3,000 Tellabs, Inc.* ........................... 165,750
3,400 WorldCom Inc.* ........................... 159,800
-----------
781,050
-----------
COMPUTER RELATED &
BUSINESS EQUIPMENT--10.2%
3,500 Bay Networks Inc.* ....................... 110,250
800 Cabletron Systems, Inc.* ................. 60,300
6,600 Cisco Systems, Inc.* ..................... 342,375
3,200 Digital Equipment Corporation* ........... 191,200
3,000 Seagate Technology* ...................... 174,000
6,000 3 Com Corp.* ............................. 276,750
-----------
1,154,875
-----------
COMPUTER SOFTWARE--2.6%
3,900 Compuware Corp.* ......................... 111,150
6,800 Informix Corporation* .................... 179,350
-----------
290,500
-----------
CONSUMER PRODUCTS--.6%
900 Colgate Palmolive Co. .................... 68,963
-----------
DEFENSE--2.9%
3,300 McDonnell Douglas Corporation ............ 318,450
-----------
FINANCIAL SERVICES--10.3%
3,000 Chase Manhattan Corp. .................... 206,625
5,664 First Data Corporation ................... 430,464
2,400 GreenTree Financial Corp. ................ 81,000
5,100 MBNA Corp. ............................... 144,713
3,000 Merrill Lynch & Co., Inc. ................ 181,125
5,000 Money Store, Inc. ........................ 126,250
-----------
1,170,177
-----------
HEALTHCARE--11.4%
3,000 Boston Scientific Corporation* ........... 129,375
5,000 Columbia/HCA Healthcare Corporation ...... 265,625
2,100 Guidant Corp. ............................ 117,863
790 Johnson & Johnson ........................ 73,075
2,800 Lilly (Eli) Co. .......................... 165,200
5,700 Merck & Co., Inc. ........................ 344,850
3,500 SmithKline Beecham PLC ADS ............... 189,000
-----------
1,284,988
-----------
HEALTH MAINTENANCE
ORGANIZATIONS--6.4%
10,200 Healthsource, Inc.* ...................... 348,075
5,600 Oxford Health Plans, Inc.* ............... 282,800
1,700 United Healthcare Corporation ............ 99,450
-----------
730,325
-----------
INSURANCE--3.9%
2,100 American International Group, Inc. ....... 191,887
4,100 Travelers Group Inc. ..................... 252,150
-----------
444,037
-----------
MACHINERY--.9%
2,100 Case Corp. ............................... 106,050
-----------
MEDICAL SERVICES--1.4%
3,000 Medtronic, Inc. .......................... 159,375
-----------
PHARMACEUTICALS--1.2%
2,000 Pfizer Inc. .............................. 137,750
-----------
RESTAURANTS & LODGING--6.9%
3,000 Boston Chicken, Inc.* .................... 96,000
11,800 Lone Star Steakhouse & Saloon, Inc.* . ... 488,225
5,000 Outback Steakhouse, Inc.* ................ 200,625
-----------
784,850
-----------
RETAILING--6.2%
6,300 General Nutrition Companies, Inc.* ....... 122,850
15,250 OfficeMax, Inc.* ......................... 400,312
3,000 Viking Office Products, Inc.* ............ 178,125
-----------
701,287
-----------
SEMI-CONDUCTORS--6.5%
4,900 Altera Corporation* ...................... 258,475
3,800 Linear Technology Corporation ............ 130,625
5,000 Maxim Integrated Products, Inc.* ......... 171,250
4,700 Xilinx, Inc.* ............................ 173,312
-----------
733,662
-----------
MISCELLANEOUS--4.8%
2,700 Loewen Group Inc. ........................ 80,663
4,600 Outdoor Systems Inc.* .................... 105,800
6,700 Service Corporation International ........ 355,937
-----------
542,400
-----------
Total Common Stocks (Cost $8,373,559) .... 10,345,264
-----------
PRINCIPAL
AMOUNT SHORT-TERM CORPORATE NOTES--5.8%
---------
$250,000 Ameritech Corp.,
5.22%, 5/7/96 ............................ 249,782
400,000 Bell Atlantic Network Funding,
5.25%, 5/9/96 ............................ 399,519
-----------
Total Short-Term Corporate Notes
(Cost $649,301) .......................... 649,301
-----------
Total Investments (Cost $9,022,860)(a) ........... 97.1% 10,994,565
Other Assets in Excess of Liabilities ............ 2.9 332,012
----- -----------
Net Assets......................................... 100.0% $11,326,577
===== ===========
*Non-income producing security.
(a)At April 30, 1996, the net unrealized appreciation on investments, based on
cost for federal income tax purposes of $9,022,860, amounted to $1,971,705
which consisted of aggregate gross unrealized appreciation of $2,082,889 and
aggregate gross unrealized depreciation of $111,184.
See Notes to Financial Statements.
3
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER GROWTH RETIREMENT PORTFOLIO
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the period
<TABLE>
<CAPTION>
FROM NOVEMBER 8, 1993
SIX MONTHS YEAR ENDED (COMMENCEMENT OF
ENDED OCTOBER 31, OPERATIONS)
APRIL 30, 1996(I)(II) 1995 TO OCTOBER 31, 1994(II)
-------------------------- ---------------- -------------------------
<S> <C> <C> <C>
Net asset value, beginning of period ...................... $ 11.65 $ 10.38 $ 10.00
------------ ------------ -------------
Net investment (loss) ..................................... (0.02) (0.01) (0.03)
Net realized and unrealized gain on investments ........... 0.88 3.59 .41
------------ ------------ -------------
Total from investment operations .................... 0.86 3.58 .38
Distribution from net realized gains ...................... -- (2.31) --
------------ ------------ -------------
Net asset value, end of period ............................ $ 12.51 $ 11.65 $ 10.38
============ ============ =============
Total Return .............................................. 7.4% 37.1% 3.8%
============ ============ =============
Ratios and Supplemental Data:
Net assets, end of period (000's omitted) ........... $ 11,327 $ 13,042 $ 9,365
============ ============ =============
Ratio of expenses to average net assets.............. 1.06%(iii) 1.11%(iii) 1.26%
============ ============ =============
Ratio of net investment income (loss) to
average net assets ................................ (.19)% (.18%) (.29%)
============ ============ =============
Portfolio Turnover Rate ............................. 62.87% 133.42% 103.79%
============ ============ =============
Average Commission Rate Paid ........................ $ .0733
============
</TABLE>
(i) Unaudited.
(ii) Ratios have been annualized; total return has not been annualized.
(iii) Reflects total expenses, including fees offset by earnings credits. The
expense ratio net of earnings credits would have been 1.03% for the
six months ended April 30, 1996 and 1.08% for the year ended
October 31, 1995.
See Notes to Financial Statements.
4
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER SMALL CAP RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Unaudited)
April 30, 1996
SHARES COMMON STOCKS--94.8% VALUE
------ -----
ALUMINUM--.4%
2,100 Reynolds Metals Co........................ $ 112,875
-----------
APPAREL--2.4%
7,000 Nautica Enterprises, Inc.* ............... 325,500
7,000 Tommy Hilfiger Corporation* .............. 318,500
-----------
644,000
-----------
BIO-TECHNOLOGY--8.9%
14,600 Biochem Pharma Inc.* ..................... 664,300
13,000 CellPro Incorporated* .................... 211,250
8,000 Centocor, Inc.* .......................... 320,000
5,000 Cygnus, Inc.* ............................ 106,875
8,800 Cytotherapeutics, Inc.* .................. 129,800
10,000 Ergo Science Corp.* ...................... 207,500
10,000 Genzyme Corp.--Tissue Repair Division* ... 137,500
5,000 Guilford Pharmaceuticals Inc.* ........... 127,500
10,000 IDEC Pharmaceuticals, Corp.* ............. 288,750
4,000 INCYTE Pharmaceuticals, Inc.* ............ 128,500
8,000 Sepracor Inc.* ........................... 112,000
-----------
2,433,975
-----------
COMMUNICATIONS--7.7%
12,400 Ascend Communications, Inc.* ............. 762,600
15,612 Glenayre Technologies Inc.* .............. 725,958
5,100 LCI International Inc.* .................. 132,600
8,900 Tellabs, Inc.* ........................... 491,725
-----------
2,112,883
-----------
COMPUTER RELATED &
BUSINESS EQUIPMENT--9.7%
4,500 Bay Networks Inc.* ....................... 141,750
10,000 Cisco Systems, Inc.* ..................... 518,750
7,000 Digital Equipment Corporation* ........... 418,250
11,300 Network Appliance Inc.* .................. 361,600
7,000 Seagate Technology* ...................... 406,000
3,500 Teltrend, Inc.* .......................... 172,813
13,700 3 Com Corp.* ............................. 631,912
-----------
2,651,075
-----------
COMPUTER SERVICES--.9%
2,000 HBO & Company ............................ 237,500
-----------
COMPUTER SOFTWARE--17.1%
12,500 AXENT Technologies Inc.* ................. 225,000
9,000 Compuware Corp.* ......................... 256,500
11,000 Electronics For Imaging Inc.* ............ 671,000
14,000 EPIC Design Technology, Inc.* ............ 479,500
15,000 Individual Inc.* ......................... 356,250
13,500 Inference Corp. Cl. A.* .................. 244,688
15,500 Informix Corporation* .................... 408,812
15,000 Isocor* .................................. 300,000
10,000 i2 Technologies Inc.* .................... 407,500
8,000 Medic Computer Systems, Inc.* ............ 748,000
7,000 Objective Systems Integrators* ........... 311,500
10,000 Softkey International Inc.* .............. 280,000
-----------
4,688,750
-----------
COMPUTER TECHNOLOGY--1.9%
5,700 Adaptec, Inc.* ........................... 327,750
9,600 C.P. Clare Corporation* .................. 202,800
-----------
530,550
-----------
FINANCIAL SERVICES--1.6%
11,000 Money Store, Inc. ........................ 277,750
5,000 Oxford Resources Corp. Cl. A.* ........... 147,500
-----------
425,250
-----------
HEALTHCARE--4.1%
5,000 CNS Inc.*................................. 98,750
5,000 Guidant Corp. ............................ 280,625
3,500 Lunar Corp.* ............................. 147,875
10,500 Orthologic Corp.* ........................ 366,188
9,000 Physicians Sales & Service, Inc.* ........ 243,000
-----------
1,136,438
----------
HEALTH MAINTENANCE
ORGANIZATIONS--3.8%
12,000 Healthsource, Inc.* ...................... 409,500
12,600 Oxford Health Plans, Inc.* ............... 636,300
-----------
1,045,800
-----------
LEISURE & ENTERTAINMENT--1.5%
3,000 Anchor Gaming Inc.* ...................... 132,564
10,000 Caribiner International Inc.* ............ 285,000
-----------
417,564
-----------
MEDICAL DEVICES--11.4%
10,000 Conceptus, Inc.* ......................... 197,500
37,500 Fuisz Technologies Ltd.* ................. 956,250
16,400 Hologic, Inc.* ........................... 483,800
25,000 Intercardia, Inc.* ....................... 562,500
6,100 Metra Biosystems, Inc.* .................. 82,350
15,000 Neuromedical Systems, Inc.* .............. 328,125
7,100 STERIS Corp.* ............................ 230,750
4,800 Target Therapeutics, Inc.* ............... 260,400
-----------
3,101,675
-----------
MEDICAL SERVICES--4.7%
5,100 CompDent Corp.* .......................... 225,675
5,000 Lincare Holdings, Inc.* .................. 194,065
9,575 PhyCor Inc.* ............................. 471,569
5,300 Quintiles Transnational Corp.* ........... 388,225
-----------
1,279,534
-----------
PAPER PACKAGING &
FOREST PRODUCTS--.5%
3,600 Sealed Air Corp.* ........................ 127,350
-----------
POLLUTION CONTROL--3.0%
5,800 United Waste Systems, Inc.* .............. 319,000
19,500 USA Waste Service, Inc.* ................. 507,000
-----------
826,000
-----------
RESTAURANTS & LODGING--3.4%
18,000 Lone Star Steakhouse & Saloon, Inc.* . ... 744,750
4,499 Outback Steakhouse, Inc.* ................ 180,522
-----------
925,272
-----------
RETAILING--4.3%
20,000 Charming Shoppes Inc.* ................... 128,760
12,000 General Nutrition Companies, Inc.* ....... 234,000
16,500 OfficeMax, Inc.* ......................... 433,125
2,000 Tiffany & Co. ............................ 130,500
4,034 Viking Office Products, Inc.* ............ 239,518
-----------
1,165,903
-----------
SEMI-CONDUCTORS--7.1%
6,200 Altera Corporation* ...................... 327,050
15,200 Maxim Integrated Products, Inc.* ......... 520,600
17,000 Microchip Technology Incorporated* ....... 433,500
18,000 Xilinx, Inc.* ............................ 663,750
-----------
1,944,900
-----------
MISCELLANEOUS--.4%
4,000 Rural/Metro Corporation* ................. 118,500
-----------
Total Common Stocks (Cost $19,218,610) ... 25,925,794
-----------
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER SMALL CAP RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Unaudited) (Continued)
April 30, 1996
PRINCIPAL
AMOUNT SHORT-TERM CORPORATE NOTES--4.4% VALUE
--------- -----
$900,000 Bell Atlantic Network Funding Corp.,
5.25%, 5/9/96........................... $ 898,950
332,000 Daimler-Benz North America Corp.,
5.23%, 5/15/96.......................... 331,325
-----------
Total Short-Term Corporate Notes
(Cost $1,230,275)....................... 1,230,275
-----------
Total Investments (Cost $20,448,885)(a) ............ 99.2% 27,156,069
Other Assets in Excess of Liabilities............... .8 206,246
------ -----------
Net Assets ......................................... 100.0% $27,362,315
====== ===========
* Non-income producing security.
(a) At April 30, 1996, the net unrealized appreciation on investments, based on
cost for federal income tax purposes of $20,448,885, amounted to $6,707,184,
which consisted of aggregate gross unrealized appreciation of $6,927,356 and
aggregate gross unrealized depreciation of $220,172.
See Notes to Financial Statements.
6
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER SMALL CAP RETIREMENT PORTFOLIO
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the period
<TABLE>
<CAPTION>
FROM NOVEMBER 8, 1993
SIX MONTHS YEAR ENDED (COMMENCEMENT OF
ENDED OCTOBER 31, OPERATIONS)
APRIL 30, 1996(I)(II) 1995 TO OCTOBER 31, 1994(II)
--------------------- ----------- -----------------------
<S> <C> <C> <C>
Net asset value, beginning of period.................... $ 17.92 $ 10.83 $ 10.00
--------- --------- ---------
Net investment (loss)................................... (0.05) (0.07) (0.07)
Net realized and unrealized gain on investments......... 2.59 7.23 .90
--------- --------- ---------
Total from investment operations.................... 2.54 7.16 .83
Distribution from net realized gains.................... -- (0.07) --
--------- --------- ---------
Net asset value, end of period.......................... $ 20.46 $ 17.92 $ 10.83
========= ========= =========
Total Return............................................ 14.2% 66.2% 8.3%
========= ========= =========
Ratios and Supplemental Data:
Net assets, end of period (000's omitted)............. $ 27,362 $ 23,002 $ 9,513
========= ========= =========
Ratio of expenses to average net assets .............. 1.04%(iii) 1.13%(iii) 1.47%
========= ========= =========
Ratio of net investment income (loss) to
average net assets.................................. (.63%) (.73%) (.80%)
========= ========= =========
Portfolio Turnover Rate............................... 99.47% 104.84% 186.76%
========= ========= =========
Average Commission Rate Paid.......................... $ .0722
=========
</TABLE>
(i) Unaudited.
(ii) Ratios have been annualized; total return has not been annualized.
(iii) Reflects total expenses, including fees offset by earnings credits. The
expense ratio net of earnings credits would have been 1.01% for the
six months ended April 30, 1996 and 1.06% for the year ended
October 31, 1995.
See Notes to Financial Statements.
7
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER MIDCAP GROWTH RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Unaudited)
April 30, 1996
SHARES COMMON STOCKS--90.3% ..................... VALUE
----- -----
AEROSPACE--1.0%
2,700 Sundstrand Corp. ......................... $ 99,225
-----------
ALUMINUM--.4%
800 Reynolds Metals Co. ...................... 43,000
-----------
APPAREL--2.3%
5,000 Tommy Hilfiger Corporation* .............. 227,500
-----------
BIO-TECHNOLOGY--2.3%
5,100 Biochem Pharma Inc.* ..................... 232,050
-----------
COMMUNICATIONS--12.9%
3,000 America Online Inc.* ..................... 192,000
4,000 Ascend Communications, Inc.* ............. 246,000
500 Cascade Communications Corp.* ............ 50,125
1,700 CompuServe Corp.* ........................ 48,450
5,000 Glenayre Technologies Inc.* .............. 232,500
2,200 LCI International Inc.* .................. 57,200
3,500 Tellabs, Inc.* ........................... 193,375
5,800 WorldCom Inc.* ........................... 272,600
-----------
1,292,250
-----------
COMPUTER RELATED &
BUSINESS EQUIPMENT--10.8%
4,000 Bay Networks Inc.* ....................... 126,000
5,400 Cisco Systems, Inc.* ..................... 280,125
2,800 Digital Equipment Corporation* ........... 167,300
2,500 Seagate Technology* ...................... 145,000
8,000 3 Com Corp.* ............................. 369,000
-----------
1,087,425
-----------
COMPUTER SOFTWARE--3.5%
3,500 Compuware Corp.* ......................... 99,750
5,900 Informix Corporation* .................... 155,613
3,600 Softkey International Inc.* .............. 100,800
-----------
356,163
-----------
COMPUTER TECHNOLOGY--1.3%
2,300 Adaptec, Inc.* ........................... 132,250
-----------
FINANCIAL SERVICES--5.2%
2,000 Green Tree Financial Corp. ............... 67,500
4,200 MBNA Corp. ............................... 119,175
11,500 Money Store, Inc. ........................ 290,375
1,800 Schwab (Charles) Corporation (The) ....... 44,100
-----------
521,150
-----------
HEALTHCARE--1.9%
2,000 Boston Scientific Corporation* ........... 86,250
1,900 Guidant Corp. ............................ 106,638
-----------
192,888
-----------
HEALTH MAINTENANCE
ORGANIZATIONS--7.0%
8,200 Healthsource, Inc.* ...................... 279,825
4,000 Oxford Health Plans, Inc.* ............... 202,000
3,800 United Healthcare Corporation ............ 222,300
-----------
704,125
-----------
LEISURE & ENTERTAINMENT--1.0%
2,000 Mirage Resorts, Incorporated* ............ 104,750
-----------
MACHINERY--.9%
1,800 Case Corp. ............................... 90,900
-----------
MEDICAL DEVICES--4.3%
3,000 Fuisz Technologies Ltd.*.................. 76,500
10,000 Neuromedical Systems Inc. ................ 218,750
4,000 VISX Incorporated* ....................... 137,000
-----------
432,250
-----------
MEDICAL SERVICES--2.9%
3,500 American Oncology Resources, Inc.* ....... 167,125
5,000 Transition Systems Inc.* ................. 121,250
-----------
288,375
-----------
PAPER PACKAGING &
FOREST PRODUCTS--.6%
1,500 Sealed Air Corp.* ........................ 53,063
-----------
POLLUTION CONTROL--1.6%
3,000 United Waste Systems, Inc.* .............. 165,000
-----------
RESTAURANTS & LODGING--7.3%
5,200 Boston Chicken Inc.* ..................... 166,400
9,700 Lone Star Steakhouse & Saloon, Inc.* ..... 401,337
4,000 Outback Steakhouse, Inc.* ................ 160,500
-----------
728,237
-----------
RETAILING--9.2%
9,300 General Nutrition Companies, Inc.* ....... 181,350
3,000 Gucci Group N.V.* ........................ 163,125
2,000 Nordstrom, Inc. .......................... 101,750
13,500 OfficeMax, Inc.* ......................... 354,375
2,000 Viking Office Products, Inc.* ............ 118,750
-----------
919,350
-----------
SEMI-CONDUCTORS--8.7%
4,400 Altera Corporation* ...................... 232,100
3,300 Linear Technology Corporation ............ 113,437
4,700 Maxim Integrated Products, Inc.* ......... 160,975
3,000 Microchip Technology Incorporated* ....... 76,500
8,000 Xilinx, Inc.* ............................ 295,000
-----------
878,012
-----------
MISCELLANEOUS--5.2%
2,200 Loewen Group Inc. ........................ 65,725
6,500 Outdoor Systems Inc.* .................... 149,500
5,800 Service Corporation International ........ 308,125
-----------
523,350
-----------
Total Common Stocks (Cost $6,818,104) .... 9,071,313
-----------
PRINCIPAL
AMOUNT SHORT-TERM CORPORATE NOTES--8.0%
---------
$ 400,000 Barnett Bank,
5.33%, 5/7/96 ............................ 399,762
400,000 Bell Atlantic Network Funding Corp.,
5.25%, 5/9/96 ............................ 399,534
-----------
Total Short-Term Corporate Notes
(Cost $799,296)......................... 799,296
-----------
Total Investments (Cost $7,617,400)(a) 98.3% 9,870,609
Other Assets in Excess of Liabilities ............. 1.7 170,979
----- ------------
Net Assets......................................... 100.0% $10,041,588
===== ============
*Non-income producing security.
(a)At April 30, 1996, the net unrealized appreciation on investments, based on
cost for federal income tax purposes of $7,617,400, amounted to $2,253,209
which consisted of aggregate gross unrealized appreciation of $2,394,974 and
aggregate gross unrealized depreciation of $141,765.
See Notes to Financial Statements.
8
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER MIDCAP GROWTH RETIREMENT PORTFOLIO
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the period
<TABLE>
<CAPTION>
FROM NOVEMBER 8, 1993
SIX MONTHS YEAR ENDED (COMMENCEMENT OF
ENDED OCTOBER 31, OPERATIONS)
APRIL 30, 1996(I)(II) 1995 TO OCTOBER 31, 1994(II)
-------------------- ---------- ----------------------
<S> <C> <C> <C>
Net asset value, beginning of period ...................... $ 16.34 $ 11.66 $ 10.00
------------ ------------ -------------
Net investment (loss) ..................................... (0.09) (0.07) (0.09)
Net realized and unrealized gain on investments ........... 1.47 6.07 1.75
------------ ------------ -------------
Total from investment operations .................... 1.38 6.00 1.66
Distribution from net realized gains ...................... -- (1.32) --
------------ ------------ -------------
Net asset value, end of period ............................ $ 17.72 $ 16.34 $ 11.66
============ ============ =============
Total Return .............................................. 8.5% 54.1% 16.6%
============ ============ =============
Ratios and Supplemental Data:
Net assets, end of period (000's omitted) ........... $ 10,042 $ 10,914 $ 6,774
============ ============ =============
Ratio of expenses to average net assets ............. 1.14%(iii) 1.23%(iii) 1.53%
============ ============ =============
Ratio of net investment income (loss) to
average net assets ................................ (.64%) (.69%) (.89%)
============ ============ =============
Portfolio Turnover Rate ............................. 75.09% 132.74% 134.06%
============ ============ =============
Average Commission Rate Paid......................... $ .0730
============
</TABLE>
(i)Unaudited.
(ii)Ratios have been annualized; total return has not been annualized.
(iii)Reflects total expenses, including fees offset by earnings credits. The
expense ratio net of earnings credits would have been 1.11% for the six
months ended April 30, 1996 and 1.16% for the year ended October 31, 1995.
See Notes to Financial Statements.
9
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Unaudited)
April 30, 1996
SHARES COMMON STOCKS--95.2% VALUE
------ -----
AEROSPACE--1.1%
700 The Boeing Company ....................... $ 57,488
500 Sundstrand Corp. ......................... 18,375
-----------
75,863
-----------
ALUMINUM--2.0%
1,100 Aluminum Co. of America .................. 68,613
1,200 Reynolds Metals Co. ...................... 64,500
-----------
133,113
-----------
APPAREL--1.3%
2,000 Tommy Hilfiger Corporation* .............. 91,000
-----------
BIO-TECHNOLOGY--12.1%
5,000 Biochem Pharma Inc.* ..................... 227,500
5,000 CellPro Incorporated* .................... 81,250
1,700 Centocor, Inc.* .......................... 68,000
3,600 Cygnus Inc.* ............................. 76,950
4,000 Ergo Science Corp.* ...................... 83,000
4,600 Genzyme Corp.-Tissue Repair Division* .... 63,250
3,300 Guilford Pharmaceuticals Inc.* ........... 84,150
2,500 IDEC Pharmaceuticals Corp.* .............. 72,187
2,000 INCYTE Pharmaceuticals, Inc.* ............ 64,250
-----------
820,537
-----------
CHEMICALS--.9%
400 Monsanto Co. ............................. 60,600
-----------
COMMUNICATIONS--10.0%
2,000 America Online Inc.* ..................... 128,000
3,200 Ascend Communications, Inc.* ............. 196,800
2,750 Glenayre Technologies Inc.* .............. 127,875
1,400 LCI International Inc.* .................. 36,400
600 U.S. Robotics Corp.* ..................... 93,900
2,000 WorldCom Inc.* ........................... 94,000
-----------
676,975
-----------
COMPUTER RELATED &
BUSINESS EQUIPMENT--12.1%
2,950 Bay Networks Inc.* ....................... 92,925
400 Cabletron Systems, Inc.* ................. 30,150
4,200 Cisco Systems, Inc.* ..................... 217,875
1,900 Digital Equipment Corporation* ........... 113,525
3,000 Network Appliance, Inc.* ................. 96,000
2,400 Seagate Technology* ...................... 139,200
2,800 3 Com Corp.* ............................. 129,150
-----------
818,825
-----------
COMPUTER SERVICES--1.2%
700 HBO & Company ............................ 83,125
-----------
COMPUTER SOFTWARE--8.0%
3,000 Electronics For Imaging Inc.* ............ 183,000
5,000 Individual, Inc.* ........................ 118,750
4,000 Informix Corporation* .................... 105,500
1,500 Objective Systems Integrators* ........... 66,750
2,400 Softkey International Inc.* .............. 67,200
-----------
541,200
-----------
COMPUTER TECHNOLOGY--1.3%
1,500 Adaptec, Inc.* ........................... 86,250
-----------
FINANCIAL SERVICES--5.4%
1,300 Chase Manhattan Corp...................... 89,538
2,000 First Data Corporation ................... 152,000
5,000 Money Store, Inc. ........................ 126,250
-----------
367,788
-----------
HEALTHCARE--5.4%
2,500 ArthroCare Corporation* .................. 63,125
900 Guidant Corp. ............................ 50,513
1,600 Lilly (Eli) Co. .......................... 94,400
3,750 Lunar Corp.* ............................. 158,437
-----------
366,475
-----------
HEALTH MAINTENANCE
ORGANIZATIONS--8.5%
6,600 Healthsource, Inc.* ...................... 225,225
4,000 Oxford Health Plans, Inc.* ............... 202,000
2,500 United Healthcare Corporation ............ 146,250
-----------
573,475
-----------
INSURANCE--3.9%
1,200 American International Group, Inc. ....... 109,650
2,500 Travelers Group Inc. ..................... 153,750
-----------
263,400
-----------
LEISURE & ENTERTAINMENT--1.3%
3,000 Caribiner International, Inc.* ........... 85,500
-----------
MACHINERY--.9%
1,200 Case Corp. ............................... 60,600
-----------
MEDICAL DEVICES--4.6%
3,900 Fuisz Technologies Ltd.* ................. 99,450
3,600 Hologic, Inc.* ........................... 106,200
2,000 Target Therapeutics, Inc.* ............... 108,500
-----------
314,150
-----------
MEDICAL SERVICES--1.5%
2,000 PhyCor Inc.* ............................. 98,500
-----------
PHARMACEUTICALS--1.0%
1,000 Pfizer Inc. .............................. 68,875
-----------
POLLUTION CONTROL--1.1%
3,000 USA Waste Services, Inc.* ................ 78,000
-----------
RETAILING--2.8%
1,300 Gucci Group N.V.* ........................ 70,687
4,500 OfficeMax, Inc.* ......................... 118,125
-----------
188,812
-----------
SEMI-CONDUCTORS--7.3%
1,600 Altera Corporation* ...................... 84,400
1,400 Linear Technology Corporation ............ 48,125
3,300 Maxim Integrated Products, Inc.* ......... 113,025
4,300 Microchip Technology Incorporated* ....... 109,650
3,900 Xilinx, Inc.* ............................ 143,812
-----------
499,012
-----------
MISCELLANEOUS--1.5%
4,400 Outdoor Systems Inc.* .................... 101,200
-----------
Total Common Stocks (Cost $5,072,833) .... 6,453,275
-----------
10
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Unaudited) (Continued)
April 30, 1996
PRINCIPAL
AMOUNT SHORT-TERM CORPORATE NOTES--5.2% VALUE
--------- -----
$150,000 Barnett Bank,
5.33%, 5/7/96 ................................. $ 149,867
201,000 Bridgestone/Firestone, Inc.,
5.35%, 5/2/96 ................................. 200,970
----------
Total Short-Term Investments
(Cost $350,837) ............................... 350,837
----------
Total Investments (Cost $5,423,670)(a) ................. 100.4% 6,804,112
Liabilities in Excess of Other Assets .................. (.4) (24,074)
------ ----------
Net Assets ............................................ 100.0% $6,780,038
===== ==========
* Non-income producing security.
(a) At April 30, 1996, the net unrealized appreciation on investments, based
on cost for federal income tax purposes of $5,423,670, amounted to
$1,380,442 which consisted of aggregate gross unrealized appreciation of
$1,462,318 and aggregate gross unrealized depreciation of $81,876.
See Notes to Financial Statements.
11
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO(iv)
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the period
<TABLE>
<CAPTION>
FROM NOVEMBER 8, 1993
SIX MONTHS YEAR ENDED (COMMENCEMENT OF
ENDED OCTOBER 31, OPERATIONS)
APRIL 30, 1996(I)(II) 1995 TO OCTOBER 31, 1994(II)
--------------------- ----------- -----------------------
<S> <C> <C> <C>
Net asset value, beginning of period ...................... $ 12.72 $ 10.08 $ 10.00
------------ ------------ ------------
Net investment (loss) ..................................... (0.22) (0.19) (0.23)
Net realized and unrealized gain on investments ........... 1.25 5.30 0.31
------------ ------------ ------------
Total from investment operations .................... 1.03 5.11 0.08
Distribution from net realized gain ....................... -- (2.47) --
------------ ------------ ------------
Net asset value, end of period ............................ $ 13.75 $ 12.72 $ 10.08
============ ============ ============
Total Return .............................................. 8.1% 54.4% 0.8%
============ ============ ============
Ratios and Supplemental Data:
Net assets, end of period (000's omitted) ........... $ 6,780 $ 8,116 $ 5,251
============ ============ ============
Ratio of expenses excluding interest to
average net assets ................................ 1.34%(iii) 1.43%(iii) 1.78%
============ ============ ============
Ratio of expenses including interest to
average net assets................................. 1.48% 2.70% 2.87%
============ ============ ============
Ratio of net investment income (loss) to
average net assets ................................ (1.26%) (2.32%) (2.53%)
============ ============ ============
Portfolio Turnover Rate ................................... 106.43% 188.53% 229.11%
============ ============ ============
Average Commission Rate Paid .............................. $ .0708
============ ============ ============
Debt outstanding at end of period ......................... -- $ 302,600 $ 955,600
============ ============ ============
Average amount of debt outstanding during
the period .............................................. $ 124,943 $ 939,600 $ 826,076
============ ============ ============
Average daily number of shares outstanding
during the period........................................ 587,335 565,805 515,270
============ ============ ============
Average amount of debt per share during
the period .............................................. $ 0.21 $ 1.66 $ 1.60
============ ============ ============
</TABLE>
(i) Unaudited.
(ii) Ratios have been annualized; total return has not been annualized.
(iii) Reflects total expenses, including fees offset by earnings credits. The
expense ratio net of earnings credits would have been 1.44% for the
six months ended April 30, 1996 and 2.66% for the year ended October 31,
1995.
(iv) Prior to April 12, 1996 the Capital Appreciation Portfolio was the
Leveraged AllCap Portfolio.
See Notes to Financial Statements.
12
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
STATEMENTS OF ASSETS AND LIABILITIES (Unaudited)
April 30, 1996
<TABLE>
<CAPTION>
MIDCAP CAPITAL
GROWTH SMALL CAP GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- ------------
<S> <C> <C> <C> <C>
ASSETS:
Investments in securities, at value (identified cost*)-
see accompanying schedules of investments............. $10,994,565 $27,156,069 $ 9,870,609 $6,804,112
Cash.................................................... 80,552 143,937 89,946 --
Receivable for investment securities sold............... 543,052 507,960 216,170 57,970
Receivable for shares of beneficial interest sold....... -- 136,312 -- --
Dividends receivable.................................... 725 -- 204 56
Organizational expenses, net............................ 1,764 1,764 1,764 1,764
Prepaid expenses........................................ 3,926 5,647 3,793 3,672
----------- ----------- ----------- ----------
Total Assets........................................ 11,624,584 27,951,689 10,182,486 6,867,574
----------- ----------- ----------- ----------
LIABILITIES:
Payable for investment securities purchased............. 280,526 556,708 123,346 64,400
Bank overdraft.......................................... -- -- -- 8,502
Accrued investment management fees...................... 7,188 18,443 6,735 4,754
Accrued expenses........................................ 10,293 14,223 10,817 9,880
----------- ----------- ----------- ----------
Total Liabilities................................... 298,007 589,374 140,898 87,536
----------- ----------- ----------- ----------
NET ASSETS.............................................. $11,326,577 $27,362,315 $10,041,588 $6,780,038
=========== =========== =========== ==========
Net Assets Consist of:
Paid-in capital....................................... $ 4,976,635 $14,795,379 $ 4,482,983 $2,899,966
Undistributed net investment income
(accumulated loss).................................. (56,858) (248,637) (141,794) (318,867)
Undistributed net realized gain....................... 4,435,095 6,108,389 3,447,190 2,818,497
Net unrealized appreciation........................... 1,971,705 6,707,184 2,253,209 1,380,442
----------- ----------- ----------- ----------
NET ASSETS.............................................. $11,326,577 $27,362,315 $10,041,588 $6,780,038
=========== =========== =========== ==========
Shares of beneficial interest outstanding--Note 6........ 905,197 1,337,440 566,732 493,222
=========== =========== =========== ==========
NET ASSET VALUE PER SHARE............................... $ 12.51 $ 20.46 $ 17.72 $ 13.75
=========== =========== =========== ==========
*Identified cost........................................ $ 9,022,860 $20,448,885 $ 7,617,400 $5,423,670
=========== =========== =========== ==========
</TABLE>
See Notes to Financial Statements.
13
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
STATEMENTS OF OPERATIONS (Unaudited)
For the Six Months ended April 30, 1996
<TABLE>
<CAPTION>
MIDCAP CAPITAL
GROWTH SMALL CAP GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO*
--------- --------- --------- ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Income:
Dividends............................................. $ 37,378 $ 1,229 $ 4,971 $ 4,229
Interest.............................................. 13,945 44,212 18,986 2,484
----------- ---------- ---------- ---------
Total income........................................ 51,323 45,441 23,957 6,713
----------- ---------- ---------- ---------
Expenses:
Management fees--Note 3(a)............................. 45,959 102,205 41,430 30,916
Interest on line of credit utilized--Note 5............ -- -- -- 5,417
Custodian fees........................................ 4,602 6,984 3,669 3,854
Transfer agent fees--Note 3(c)......................... 1,250 1,250 1,250 1,250
Professional fees..................................... 3,793 3,793 3,793 3,793
Trustees' fees........................................ 2,992 2,992 2,992 2,992
Miscellaneous......................................... 6,096 8,048 5,898 5,759
----------- ---------- ---------- ---------
64,692 125,272 59,032 53,981
Less, earnings credits--Note 2(e)...................... (1,450) (4,140) (1,710) (1,503)
----------- ---------- ---------- ---------
Total net expenses.................................. 63,242 121,132 57,322 52,478
----------- ---------- ---------- ---------
NET INVESTMENT INCOME (LOSS)............................ (11,919) (75,691) (33,365) (45,765)
----------- ---------- ---------- ---------
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS:
Net realized gain on investments...................... 1,508,221 3,489,461 1,721,763 810,713
Net change in unrealized appreciation
on investments...................................... (524,263) 153,408 (791,047) (183,148)
----------- ---------- ---------- ---------
Net realized and unrealized gain
on investments...................................... 983,958 3,642,869 930,716 627,565
----------- ---------- ---------- ---------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS..................................... $ 972,039 $3,567,178 $ 897,351 $ 581,800
=========== ========== ========== =========
</TABLE>
*Prior to April 12, 1996 the Capital Appreciation Portfolio was the Leveraged
AllCap Portfolio.
See Notes to Financial Statements.
14
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO*
STATEMENT OF CASH FLOWS (Unaudited)
For the Six Months ended April 30, 1996
- --------------------------------------------------------------------------------
INCREASE (DECREASE) IN CASH:
Cash flows from operating activities:
Dividends received............................................. $ 4,365
Interest received.............................................. 2,484
Interest paid.................................................. (12,156)
Operating expenses paid........................................ (52,758)
Purchase of short-term securities, net......................... (350,837)
Purchase of investment securities.............................. (8,037,858)
Proceeds from disposition of investment securities............. 10,479,640
Other.......................................................... (2,520)
-----------
Net cash provided by operating activities................... 2,030,360
------------
Cash flows from financing activities:
Proceeds from shares sold..................................... 229,925
Payments on shares redeemed................................... (2,144,323)
Repayment of bank borrowings................................. (302,600)
------------
Net cash used in financing activities....................... (2,216,998)
------------
Net decrease in cash............................................. (186,638)
Cash--beginning of period........................................ 178,136
------------
Cash--end of period.............................................. $ (8,502)
============
Reconciliation of net increase in net assets to net cash
provided by operating activities:
Net increase in net assets resulting from operations........... $ 581,800
Decrease in investments........................................ 1,698,770
Decrease in receivable for investment securities sold.......... 605,518
Decrease in interest and dividends receivable.................. 136
Decrease in payable for investment securities purchased........ (213,344)
Net realized gain on investments............................... (810,713)
Net decrease in unrealized appreciation on investments......... 183,148
Decrease in accrued expenses and other liabilities............. (12,786)
Net increase in other assets................................... (2,169)
------------
Net cash provided by operating activities.................... $ 2,030,360
============
*Prior to April 12, 1996 the Capital Appreciation Portfolio was the Leveraged
AllCap Portfolio.
See Notes to Financial Statements.
15
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
STATEMENTS OF CHANGES IN NET ASSETS (Unaudited)
For the Six Months ended April 30, 1996
<TABLE>
<CAPTION>
MIDCAP CAPITAL
GROWTH SMALL CAP GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO*
--------- --------- --------- ------------
<S> <C> <C> <C> <C>
Net investment (loss)................................... $ (11,919) $ (75,691) $ (33,365) $ (45,765)
Net realized gain on investments........................ 1,508,221 3,489,461 1,721,763 810,713
Net change in unrealized appreciation (depreciation)
on investments........................................ (524,263) 153,408 (791,047) (183,148)
----------- ----------- ----------- -----------
Net increase in net assets resulting from operations.. 972,039 3,567,178 897,351 581,800
Net increase (decrease) from shares of beneficial
interest transactions--Note 6.......................... (2,687,199) 793,571 (1,770,092) (1,917,781)
----------- ----------- ----------- -----------
Total increase (decrease)........................... (1,715,160) 4,360,749 (872,741) (1,335,981)
Net Assets:
Beginning of period................................... 13,041,737 23,001,566 10,914,329 8,116,019
----------- ----------- ----------- -----------
End of period......................................... $11,326,577 $27,362,315 $10,041,588 $ 6,780,038
=========== =========== =========== ===========
Undistributed net investment income (accumulated loss).. $ (56,858) $ (248,637) $ (141,794) $ (318,867)
=========== =========== =========== ===========
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
THE ALGER RETIREMENT FUND
STATEMENTS OF CHANGES IN NET ASSETS
For the year ended October 31, 1995
<TABLE>
<CAPTION>
MIDCAP CAPITAL
GROWTH SMALL CAP GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO*
--------- --------- --------- -----------
<S> <C> <C> <C> <C>
Net investment (loss)................................... $ (19,837) $ (112,030) $ (56,941) $ (151,263)
Net realized gain on investments........................ 2,914,058 2,620,966 1,676,799 1,934,036
Net change in unrealized appreciation
on investments........................................ 617,050 5,485,820 2,165,746 1,097,196
----------- ----------- ----------- -----------
Net increase in net assets resulting from operations.. 3,511,271 7,994,756 3,785,604 2,879,969
Dividends to Shareholders:
Net realized gains.................................... (2,104,329) (75,100) (790,355) (1,300,367)
Net increase from shares of beneficial
interest transactions--Note 6.......................... 2,270,180 5,569,368 1,145,072 1,285,910
----------- ----------- ----------- ------------
Total increase...................................... 3,677,122 13,489,024 4,140,321 2,865,512
Net Assets:
Beginning of year..................................... 9,364,615 9,512,542 6,774,008 5,250,507
----------- ----------- ----------- -----------
End of year........................................... $13,041,737 $23,001,566 $10,914,329 $ 8,116,019
=========== =========== =========== ===========
Undistributed net investment income (accumulated loss).. $ (44,939) $ (172,946) $ (108,429) $ (273,102)
=========== =========== =========== ===========
</TABLE>
*Prior to April 12, 1996 the Capital Appreciation Portfolio was the Leveraged
AllCap Portfolio.
See Notes to Financial Statements.
16
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
NOTES TO FINANCIAL STATEMENTS (Unaudited)
NOTE 1--General:
The Alger Retirement Fund (the "Fund"), (which was The Alger Defined
Contribution Trust prior to April 12, 1996), is a diversified, open-end
registered investment company organized as an unincorporated business trust
under the laws of the Commonwealth of Massachusetts. The Fund operates as a
series company and currently issues four classes of shares of beneficial
interest --Growth Portfolio, Small Cap Portfolio, MidCap Growth Portfolio and
Capital Appreciation Portfolio (the "Portfolios"). Prior to April 12, 1996 the
Capital Appreciation Portfolio was the Leveraged AllCap Portfolio.
NOTE 2--Significant Accounting Policies:
(a) INVESTMENT VALUATION: Investments of the Portfolios are valued on each
day the New York Stock Exchange (the "NYSE") is open as of the close of the NYSE
(currently 4:00 p.m. Eastern time). Listed and unlisted securities for which
such information is regularly reported are valued at the last reported sales
price or, in the absence of reported sales, at the mean between the bid and
asked price or, in the absence of a recent bid or asked price, the equivalent as
obtained from one or more of the major market makers for the securities to be
valued.
Securities for which market quotations are not readily available are valued
at fair value, as determined in good faith pursuant to procedures established by
the Board of Trustees.
Short-term securities having a remaining maturity of sixty days or less are
valued at amortized cost which approximates market value.
(b) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions
are recorded on a trade date basis. Realized gains and losses from securities
transactions are recorded on the identified cost basis. Dividend income is
recognized on the ex-dividend date and interest income is recognized on the
accrual basis.
(c) DIVIDENDS TO SHAREHOLDERS: Dividends payable to shareholders are recorded
on the ex-dividend date. With respect to all Portfolios, dividends from net
investment income and dividends from net realized gains, offset by any loss
carry forward, are declared and paid annually after the end of the fiscal year
in which earned.
(d) FEDERAL INCOME TAXES: It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required. Each Portfolio is
treated as a separate entity for the purpose of determining such compliance.
(e) EXPENSES: The Fund accounts separately for the assets, liabilities and
operations of each Portfolio. Expenses directly attributable to each Portfolio
are charged to that Portfolio's operations; expenses which are applicable to all
Portfolios are allocated among them. Organizational expenses are being amortized
from the date operations commenced over a five year period. The Fund's custodian
fees have been reduced as a result of earnings credits received on overnight
cash balances. Balances left on deposit with the custodian preclude their use
elsewhere.
(f) OTHER: These financial statements have been prepared using estimates and
assumptions that affect the reported amounts therein. Actual results may differ
from those estmates.
NOTE 3--Investment Management Fees and Other Transactions with Affiliates:
(a) INVESTMENT MANAGEMENT FEES: Fees incurred by each Portfolio, pursuant to
the provisions of Investment Management Agreements (the "Agreements") with Fred
Alger Management, Inc. ("Alger Management"), are payable monthly and computed
based on the value of the average daily net assets of each Portfolio at the
following annual rates:
Growth Portfolio............................. .75%
Small Cap Portfolio.......................... .85
MidCap Growth Portfolio...................... .80
Capital Appreciation Portfolio............... .85
The Agreements further provide that if in any fiscal year the aggregate
expenses of any Portfolio, excluding interest, taxes, brokerage commissions,
distribution fees and extraordinary expenses, exceed the expense limitation of
any state securities laws having jurisdiction over a Portfolio, Alger Management
will reimburse that Portfolio for the excess expense to the extent required by
such state laws.
(b) BROKERAGE COMMISSIONS: During the six months ended April 30, 1996, the
Growth Portfolio, the Small Cap Portfolio, the MidCap Growth Portfolio and the
Capital Appreciation Portfolio paid Fred Alger & Company, Incorporated ("Alger
Inc."), the Fund's distributor, commissions of $13,260, $18,862, $12,230 and
$7,575, respectively, in connection with securities transactions.
(c) TRANSFER AGENT FEES: Alger Shareholder Services, Inc. ("Alger Services"),
an affiliate of Alger Management, serves as transfer agent for the Fund. During
the six months ended April 30, 1996, each Portfolio incurred fees of $1,250, for
services provided by Alger Services.
(d) OTHER TRANSACTIONS WITH AFFILIATES: Certain trustees and officers of the
Fund are directors and officers of Alger Management, Alger Inc. and Alger
Services. At April 30, 1996 Alger Management and its affiliates owned 904,351
shares, 511,013 shares, 566,732 shares and 493,222 shares of the Growth
Portfolio, the Small Cap Portfolio, the MidCap Growth Portfolio and the Capital
Appreciation Portfolio, respectively.
NOTE 4--Securities Transactions:
The following summarizes the securities transactions by the Fund, other than
short-term securities, for the six months ended April 30, 1996:
PURCHASES SALES
--------- -----
Growth Portfolio.................. $ 7,345,088 $10,722,130
Small Cap Portfolio............... 23,539,363 22,941,399
MidCap Growth Portfolio........... 7,250,045 9,518,429
Capital Appreciation Portfolio.... 7,824,514 9,874,134
17
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
NOTE 5--Short-Term Borrowings:
The Capital Appreciation Portfolio has a line of credit with a bank whereby
it may borrow up to 1/3 of its assets, as defined, up to a maximum of
$25,000,000. Such borrowings are collateralized by securities owned by the
Portfolio, have a variable interest rate and are payable on demand. For the six
months ended April 30, 1996, the Portfolio had borrowings which averaged
$124,943 at a weighted average interest rate of 8.62%.
NOTE 6--Share Capital:
The Fund has an unlimited number of authorized shares of beneficial
interest of $.001 par value which are presently divided into four classes of
shares.
During the six months ended April 30, 1996, transactions of shares of
beneficial interest were as follows:
SHARES AMOUNT
------ ------
Growth Portfolio
Shares sold 49,544 $ 602,481
Shares redeemed (264,101) (3,289,680)
--------- -----------
Net decrease (214,557) $(2,687,199)
======== ===========
Small Cap Portfolio
Shares sold 231,725 $ 4,131,540
Shares redeemed (177,548) (3,337,969)
-------- ===========
Net increase 54,177 $ 793,571
-------- ===========
MidCap Growth Portfolio
Shares sold 32,872 $ 546,947
Shares redeemed (134,038) (2,317,039)
-------- ===========
Net decrease (101,166) $(1,770,092)
-------- ===========
Capital Appreciation Portfolio
Shares sold 17,884 $ 226,542
Shares redeemed (162,730) (2,144,323)
-------- -----------
Net decrease (144,846) $(1,917,781)
-------- ===========
During the year ended October 31, 1995, transactions of shares of beneficial
interest were as follows:
SHARES AMOUNT
------ ------
Growth Portfolio
Shares sold 15,649 $ 171,231
Dividends reinvested 202,145 2,104,329
-------- -----------
217,794 2,275,560
Shares redeemed (470) (5,380)
-------- -----------
Net increase 217,324 $ 2,270,180
======== ===========
Small Cap Portfolio
Shares sold 422,015 $ 5,804,623
Dividends reinvested 5,085 75,100
-------- -----------
427,100 5,879,723
Shares redeemed (21,812) (310,355)
-------- -----------
Net increase 405,288 $ 5,569,368
======== ===========
MidCap Growth Portfolio
Shares sold 27,857 $ 369,295
Dividends reinvested 59,875 790,355
-------- ----------
87,732 1,159,650
Shares redeemed (1,007) (14,578)
-------- -----------
Net increase 86,725 $ 1,145,072
======== ===========
Capital Appreciation Portfolio
Shares sold 14,786 $ 163,455
Dividends reinvested 117,787 1,300,367
-------- -----------
132,573 1,463,822
Shares redeemed (15,285) (177,912)
-------- -----------
Net increase 117,288 $ 1,285,910
======== ===========
18
