THE ALGER
RETIREMENT
FUND
ALGER GROWTH
RETIREMENT PORTFOLIO
ALGER SMALL CAP
RETIREMENT PORTFOLIO
ALGER MIDCAP GROWTH
RETIREMENT PORTFOLIO
ALGER CAPITAL APPRECIATION
RETIREMENT PORTFOLIO
ANNUAL
REPORT OCTOBER 31, 1999
<PAGE>
November 24, 1999
FELLOW SHAREHOLDERS:
THE YEAR IN REVIEW
As 1999 draws to a close, investors may look back on this decade as one of
remarkable opportunity. From January 1, 1990 through October 31, 1999, the value
of the U.S. stock market rose nearly 393%, as measured by the S&P 500. The
current economic boom has lasted 101 months, one month short of the record for
this century. And the lengthy economic expansion, combined with relatively low
interest rates and low inflation, has contributed to an unprecedented four
consecutive years of 20%-plus returns for stock investors, with few significant
corrections along the way.
The last two years have seen an increase in day-to-day volatility, more in
line with longer term norms. This trend continued in 1999, driven by concerns
over the stability of global financial systems and the shorter term outlook for
U.S. interest rates.
Year to date, 1999 has again generated double-digit returns for stock
investors, with the S&P 500 up 12.03% from January through the end of October.
Strong economic growth -- a 3.7% rise in GDP in the first quarter -- contributed
to the Dow Jones Industrial Average's push above all records to close above
10,000 in March. From May to July, the Dow traded in the 11,000 range before
falling back on fears of higher interest rates and concerns that stocks had
become overvalued. During the second quarter, concerns about potential inflation
increased as unemployment remained at its lowest levels since 1970. While core
inflation remained in the 2% range, oil prices began rising early in the year
and had nearly doubled by July. This was largely a political rather than a true
supply/demand effect and has not had a broad effect on market prices, yet it
bears watching in coming months.
Concerns about potential increases in core inflation led the Federal
Reserve to adopt a tightening bias during the second quarter. In the following
months, the Federal Open-Market Committee twice raised short-term interest rates
to forestall potential increases in inflation. In the bond markets higher
interest rates pushed prices lower, particularly at the short and long ends of
the maturity spectrum.
In this environment, market gains in the first quarter of 1999 were led by
the large-cap, blue-chip growth companies, as investors sought a sense of
security in the wake of 1998's Asian currency crisis and Russian debt default.
As recovery in Asia became more certain, the second quarter saw a resurgence of
interest in smaller-cap issues. Small-cap value stocks turned in the best
results and large-cap growth stocks turned in the worst.
The third quarter of 1999 saw an overall decline in domestic stocks. The
S&P 500 fell 6.25%, while the S&P MidCap 400 Index dropped 8.40%.
Small-capitalization stocks, as measured by the Russell 2000 Growth Index, fared
slightly better, falling 4.91% during the same quarter. Overall, growth stocks
again outperformed value stocks. Factors affecting the market's performance in
the third quarter included the potential impact on earnings of technology
companies from the earthquake in Taiwan and continued uncertainty about interest
rates. Entering the fourth quarter, there were gains in October with the S&P 500
returning 6.33%, led by a recovery in technology stocks. The technology-laden
Nasdaq 100 rose 9.54% for the month.
PORTFOLIO MATTERS
By maintaining a focus on bottom-up stock selection in a market environment
that evidenced clear biases toward certain segments of the market, all of The
Alger Retirement Fund's Portfolios outperformed their benchmarks for the 12
months ended October 31, 1999.
<PAGE>
ALGER SMALL CAP RETIREMENT PORTFOLIO
For the year ended October 31, 1999, the Alger Small Cap Retirement
Portfolio returned 52.73%, substantially outperforming the Russell 2000 Growth
Index, which rose 29.29% during the same period. Compared with its benchmark,
the Portfolio was heavily invested in semiconductor, technology, and retail
stocks which contributed to the Portfolio's strong performance.
ALGER GROWTH RETIREMENT PORTFOLIO
For the year ended October 31, 1999, the Alger Growth
Retirement Portfolio gained 42.00% compared to a 25.67% rise in the benchmark
S&P 500. The Portfolio benefited from the market's preference for large,
blue-chip stocks through the first quarter. Its substantial positions in
semiconductor, technology and consumer stocks contributed to its strong
performance in the first half of the year. As energy prices and interest rates
rose the Portfolio's exposure to lagging energy-dependent transportation stocks
and interest rate-sensitive financial stocks was reduced.
ALGER MIDCAP GROWTH RETIREMENT PORTFOLIO
The Alger MidCap Growth Retirement Portfolio returned 42.39% for the year
ended October 31, 1999, compared to 21.07% for the benchmark S&P MidCap 400.
Midcap stocks as a group benefited during the second quarter from the market's
rotation away from larger issues. The Portfolio's larger positions in
semiconductor and Internet stocks contributed to its outperforming the
benchmark. High employment and strong economic growth also favored the
Portfolio's holdings in retail and consumer stocks.
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO
During the 12 months ended October 31, 1999, the Alger Capital Appreciation
Retirement Portfolio gained 84.34% compared to the S&P 500's rise of 25.67%. The
Portfolio's exposure to the broader market, including small and
mid-capitalization stocks, offered gains as investors moved from large-cap
companies to smaller issues after the first quarter of 1999. Heavy weightings
relative to its benchmark in Internet, semiconductor and retail stocks
contributed to the Portfolio's strong performance.
LOOKING AHEAD
The Alger Retirement Fund's Portfolios are managed to pursue their
investment objectives by applying an investment philosophy which we at Fred
Alger Management believe will serve investors well as we enter the next
millennium. Changing demographics, new technologies, and ever-increasing
sophistication in the financial markets will create new opportunities in the
decades to come. Through rigorous fundamental research, coupled with advanced
analytic capabilities, we will continue to seek out companies that offer
investors the potential for superior returns.
Respectfully submitted,
/s/ David D. Alger
- ---------------------
David D. Alger
President
<PAGE>
ALGER GROWTH RETIREMENT PORTFOLIO
PORTFOLIO HIGHLIGHTS THROUGH OCTOBER 31, 1999 (UNAUDITED)
$10,000 HYPOTHETICAL INVESTMENT SINCE INCEPTION NOVEMBER 8, 1993
[Line Chart Omitted]
Alger Retirement Growth S&P 500 Index
11/8/93 10000 10000
10/31/94 10380 10410
10/31/95 14231 13162
10/31/96 15396 16333
10/31/97 19836 21579
10/31/98 24878 26324
10/31/99 35312 33082
The chart above illustrates the growth in value of a hypothetical $10,000
investment made in the Alger Growth Retirement Portfolio and the S&P 500 Index
on November 8, 1993, the inception date of the Alger Growth Retirement
Portfolio. The figures for both the Alger Growth Retirement Portfolio and the
S&P 500 Index, an unmanaged index of common stocks, include reinvestment of
dividends.
PERFORMANCE COMPARISON THROUGH OCTOBER 31, 1999
Average Annual Returns
Since Inception
1 Year 5 Years 11/8/93
---------------------------------
Alger Growth
Retirement Portfolio 42.00% 27.76% 23.48%
S&P 500 Index 25.67% 26.02% 22.15%
----------------------------------
THE PORTFOLIO'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE AND
REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE DOES NOT GUARANTEE
FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE AND THE
PORTFOLIO'S SHARES WHEN REDEEMED MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL
COST.
3
<PAGE>
THE ALGER RETIREMENT FUND
ALGER GROWTH RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS
October 31, 1999
SHARES COMMON STOCKS--94.0% VALUE
- ------ -----
ADVERTISING--1.2%
9,900 Omnicom Group Inc. .................................. $ 871,200
-----------
AEROSPACE--3.5%
22,500 AlliedSignal Inc. ................................... 1,281,094
21,000 United Technologies Corp. ........................... 1,270,500
----------
2,551,594
-----------
AUTOMOTIVE--1.0%
12,500 Harley Davidson, Inc. ............................... 741,406
----------
BIO-TECHNOLOGY--2.3%
16,600 Amgen Inc.* ......................................... 1,323,850
4,300 Biogen Inc.* ........................................ 318,738
---------
1,642,588
----------
BROADCASTING--.6%
5,200 Clear Channel Communications Inc.* .................. 417,950
----------
BUILDING & CONSTRUCTION--.4%
10,800 Masco Corp. ......................................... 329,400
----------
BUSINESS SERVICES--1.5%
37,000 IMS Health Inc. ..................................... 1,073,000
----------
COMMUNICATION EQUIPMENT--7.8%
34,300 Cisco Systems, Inc.* ................................ 2,538,200
20,800 Corning Inc. ........................................ 1,635,400
15,600 Motorola, Inc. ...................................... 1,520,025
----------
5,693,625
----------
COMMUNICATIONS--12.5%
23,000 America Online Inc.* ................................ 2,982,813
15,228 At Home Corp. Series A.* ............................ 569,147
23,800 Comcast Corp. Cl. A. Special ........................ 1,002,575
14,300 COX Communications Inc., Cl. A.* .................... 649,756
13,600 MCI Worldcom Inc.* .................................. 1,167,050
9,500 MediaOne Group Inc.* ................................ 675,094
1,900 Qualcomm Inc.* ...................................... 423,225
9,460 SBC Communications Inc. ............................. 481,869
15,700 Sprint Corp. ........................................ 1,166,706
----------
9,118,235
----------
COMPUTER RELATED & BUSINESS
EQUIPMENT--1.2%
8,000 Sun Microsystems Inc.* .............................. 846,500
----------
COMPUTER SERVICES--4.7%
13,000 eBay Inc.* .......................................... 1,756,625
9,092 Yahoo Inc.* ......................................... 1,628,036
----------
3,384,661
----------
COMPUTER SOFTWARE--5.3%
15,600 Intuit Inc.* ........................................ 454,350
36,500 Microsoft Corporation* .............................. 3,378,531
----------
3,832,881
----------
CONGLOMERATE--3.0%
55,172 Tyco International Ltd. ............................. 2,203,432
----------
ENERGY & ENERGY SERVICES--2.5%
48,600 Halliburton Co. ..................................... $1,831,613
----------
FINANCIAL SERVICES--13.1%
4,000 American Express Co. ................................ 616,000
20,128 Bank of America Corp. ............................... 1,295,740
47,400 Citigroup Inc. ...................................... 2,565,525
11,500 Firstar Corp. ....................................... 337,813
25,000 Household International Inc. ........................ 1,115,625
15,200 Kansas City Southern Industries Inc. ................ 721,050
5,000 Merrill Lynch & Co., Inc. ........................... 392,500
22,600 Morgan Stanley Dean Witter & Co. .................... 2,493,063
----------
9,537,316
----------
FOOD CHAINS--.7%
24,600 Kroger Co.* ......................................... 511,987
----------
INSURANCE--2.0%
14,093 American International Group, Inc. .................. 1,450,698
----------
LEISURE & ENTERTAINMENT--1.0%
16,200 Carnival Corp. ...................................... 720,900
----------
MANUFACTURING--.6%
6,000 Solectron Corp.* .................................... 451,500
----------
OIL & GAS--.9%
24,000 Baker Hughes Inc. ................................... 670,500
----------
PHARMACEUTICALS--6.9%
4,950 Bristol Myers Squibb Co. ............................ 380,222
54,700 Pfizer Inc. ......................................... 2,160,650
30,900 Warner-Lambert Co. .................................. 2,466,206
----------
5,007,078
----------
RETAILING--7.9%
7,600 Abercrombie & Fitch Co., Cl. A.* .................... 207,100
12,200 Amazon.com Inc.* .................................... 861,625
14,500 Best Buy Company Inc.* .............................. 805,656
4,500 Costco Wholesale Corp.* ............................. 361,406
31,300 Home Depot, Inc. .................................... 2,363,150
20,000 Wal-Mart Stores Inc. ................................ 1,133,750
----------
5,732,687
----------
SEMICONDUCTOR
CAPITAL EQUIPMENT--4.1%
25,300 Applied Materials Inc.* ............................. 2,272,256
19,000 Teradyne, Inc.* ..................................... 731,500
----------
3,003,756
----------
SEMICONDUCTORS--9.3%
22,000 Altera Corporation* ................................. 1,069,750
13,900 Intel Corp. ......................................... 1,076,381
16,200 Linear Technology Corporation ....................... 1,132,987
23,400 Micron Technology Inc.* ............................. 1,668,712
4,400 Texas Instruments, Incorporated ..................... 394,900
17,800 Xilinx, Inc.* ....................................... 1,399,525
----------
6,742,255
----------
Total Common Stocks
(Cost $54,521,805) 68,366,762
----------
4
<PAGE>
THE ALGER RETIREMENT FUND
ALGER GROWTH RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
October 31, 1999
PRINCIPAL
AMOUNT SHORT-TERM CORPORATE NOTES--4.2% VALUE
- --------- -----
$700,000 Atlantis One Funding Corp.,
5.30%, 11/15/99 ............................... $ 698,555
150,000 AT&T Corporation,
5.18%, 11/9/99 ................................ 149,827
300,000 Enterprise Funding Corp.,
5.33%, 11/19/99 (a) ........................... 299,200
800,000 Ford Motor Credit Company,
5.23%, 11/16/99 ............................... 798,255
100,000 Ford Motor Credit Company,
5.22%, 11/16/99 ............................... 99,782
900,000 Merrill Lynch & Co. Inc.,
5.30%, 11/19/99 ............................... 897,615
100,000 Toyota Credit De Puerto Rico,
5.27%, 11/15/99 ............................... 99,796
----------
Total Short-Term Corporate Notes
(Cost $3,043,030) ............................. 3,043,030
----------
Total Investments
(Cost $57,564,835)(b) ...................... 98.2% 71,409,792
Other Assets in Excess of Liabilities ........ 1.8 1,336,132
----- ----------
Net Assets ................................... 100.0% $72,745,924
===== ==========
* Non-income producing security.
(a) Pursuant to Securities and Exchange Commission Rule 144A, these securities
may be sold prior to their maturity only to qualified institutional buyers.
(b) At October 31, 1999, the net unrealized appreciation on investments, based
on cost for federal income tax purposes of $57,564,835, amounted to
$13,844,957 which consisted of aggregate gross unrealized appreciation of
$15,229,809 and aggregate gross unrealized depreciation of $1,384,852.
See Notes to Financial Statements.
5
<PAGE>
THE ALGER RETIREMENT FUND
ALGER GROWTH RETIREMENT PORTFOLIO
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the year
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
--------------------------------------------------
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of year .................... $12.37 $10.78 $9.32 $11.65 $10.38
------- ------- ------- ------- -------
Net investment income (loss) ........... (0.05) (0.01)(i) (0.02)(i) (0.01) (0.01)
Net realized and unrealized
gain on investments .................. 5.23 2.82 2.65 0.91 3.59
------- ------- ------- ------- -------
Total from investment
operations ...................... 5.18 2.81 2.63 0.90 3.58
Distributions from net
realized gains ....................... (0.38) (1.22) (1.17) (3.23) (2.31)
------- ------- ------- ------- -------
Net asset value,
end of year .......................... $17.17 $12.37 $10.78 $9.32 $11.65
======= ======= ======= ======= =======
Total Return 42.0% 25.4% 28.8% 8.2% 37.1%
======= ======= ======= ======= =======
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted) .................... $72,746 $40,196 $22,922 $11,325 $13,042
======= ======= ======= ======= =======
Ratio of expenses to
average net assets ................. 1.07% 1.11% 1.13% 1.07% 1.11%
======= ======= ======= ======= =======
Ratio of net investment
income (loss) to
average net assets ................. (0.39%) (0.06%) (0.22%) (0.09%) (0.18%)
======= ======= ======= ======= =======
Portfolio Turnover Rate 143.80% 130.31% 159.38% 142.83% 133.42%
======= ======= ======= ======= =======
</TABLE>
(i) Amount was computed based on average shares outstanding during the year.
See Notes to Financial Statements.
6
<PAGE>
ALGER SMALL CAP RETIREMENT PORTFOLIO
PORTFOLIO HIGHLIGHTS THROUGH OCTOBER 31, 1999 (UNAUDITED)
$10,000 HYPOTHETICAL INVESTMENT SINCE INCEPTION NOVEMBER 8, 1993
Alger Small Cap Retirement Russell 2000 Growth Index
11/8/93 10000 10000
10/31/94 10830 10005
10/31/95 17999 12063
10/31/96 19654 13671
10/31/97 23388 16565
10/31/98 22971 13940
10/31/99 35085 18022
The chart above illustrates the growth in value of a hypothetical $10,000
investment made in the Alger Small Cap Retirement Portfolio and the Russell 2000
Growth Index on November 8, 1993, the inception date of the Alger Small Cap
Retirement Portfolio. The figures for the Alger Small Cap Retirement Portfolio
and the Russell 2000 Growth Index, an unmanaged index of common stocks, include
reinvestment of dividends.
PERFORMANCE COMPARISON THROUGH OCTOBER 31, 1999
Average Annual Returns
Since Inception
1 Year 5 Years 11/8/93
------------------------------------
Alger Small Cap
Retirement Portfolio 52.73% 26.50% 23.35%
Russell 2000 Growth Index 29.29% 12.49% 10.35%
------------------------------------
THE PORTFOLIO'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE AND
REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE DOES NOT GUARANTEE
FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE AND THE
PORTFOLIO'S SHARES WHEN REDEEMED MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL
COST.
7
<PAGE>
THE ALGER RETIREMENT FUND
ALGER SMALL CAP RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS
October 31, 1999
SHARES COMMON STOCKS--87.1% VALUE
- ------ -------
ADVERTISING--1.9%
26,600 Young & Rubicam Inc. ................................ $1,216,950
-----------
AIRLINES--.5%
12,800 SkyWest Inc. ........................................ 317,600
-----------
AUTOMOTIVE--1.0%
60,000 Sonic Automotive Inc., Cl. A.* ...................... 626,250
-----------
AUTOMOTIVE EQUIPMENT &
SERVICES--.8%
11,000 Speedway Motorsports Inc.* .......................... 479,875
-----------
BIO-TECHNOLOGY--2.6%
5,000 Medimmune Inc.* ..................................... 560,000
13,400 Sepracor Inc.* ...................................... 1,114,712
-----------
1,674,712
-----------
BROADCASTING--5.9%
34,800 Citadel Communications Corp.* ....................... 1,681,275
15,000 Emmis Communications Corp., Cl. A.* ................. 1,081,875
40,000 Salem Communications Corp., Cl. A.* ................. 995,000
-----------
3,758,150
-----------
BUSINESS SERVICES--4.6%
20,300 BISYS Group Inc.* ................................... 1,035,300
23,500 FactSet Research Systems Inc. ....................... 1,561,280
21,800 Rent-Way Inc.* ...................................... 362,425
-----------
2,959,005
-----------
COMMUNICATION EQUIPMENT--1.8%
13,000 Aware Inc.* ......................................... 413,563
10,000 Flextronics International Ltd.* ..................... 710,000
-----------
1,123,563
-----------
COMMUNICATIONS--1.5%
8,000 Cox Radio, Inc., Cl. A.* ............................ 560,000
17,000 ITC DeltaCom Inc.* .................................. 408,000
-----------
968,000
-----------
COMPUTER RELATED &
BUSINESS EQUIPMENT--4.8%
25,000 Antec Corp.* ........................................ 1,212,500
10,500 Dupont Photomasks Inc.* ............................. 519,750
14,800 Sanmina Corporation* ................................ 1,332,925
-----------
3,065,175
-----------
COMPUTER SERVICES--5.7%
26,100 CNET Inc.* .......................................... 1,231,594
10,000 Exodus Communications, Inc.* ........................ 860,000
27,500 QRS Corp.* .......................................... 1,529,688
-----------
3,621,282
-----------
COMPUTER SOFTWARE--5.4%
30,000 Dendrite International Inc. * ....................... 941,250
48,600 Intuit Inc.* ........................................ 1,415,475
10,000 Micromuse Inc.* ..................................... 1,068,750
-----------
3,425,475
-----------
CONSUMER PRODUCTS--1.9%
8,300 Furniture Brands International Inc.* ................ 160,813
35,000 Mettler-Toledo Intl. Inc.* .......................... 1,043,436
-----------
1,204,249
-----------
ENERGY & ENERGY SERVICES--1.2%
5,000 Calpine Corp.* ...................................... 288,125
36,000 Forest Oil Corporation* ............................. 481,500
-----------
769,625
-----------
FINANCIAL SERVICES--.6%
14,800 National Commerce Bancorp ........................... 370,000
-----------
FOODS & BEVERAGES--.6%
10,000 Beringer Wine Estates Holdings, Cl. B.* ............. 397,500
-----------
HEALTH CARE--.9%
15,000 Cytyc Corporation* .................................. 596,250
-----------
INDUSTRIAL EQUIPMENT--1.5%
17,700 Waters Corp.* ....................................... 940,313
-----------
MEDICAL SERVICES--2.0%
27,000 Hooper Holmes Inc. .................................. 725,625
16,100 MedQuist Inc.* ...................................... 515,200
-----------
1,240,825
-----------
OIL & GAS--2.6%
15,100 B.J. Services Company* .............................. 518,119
108,800 Varco International Inc.* ........................... 1,149,200
-----------
1,667,319
-----------
PHARMACEUTICALS--1.7%
24,200 Forest Laboratories, Inc.* .......................... 1,110,175
-----------
RESTAURANTS & LODGING--1.4%
37,500 Outback Steakhouse, Inc.* ........................... 862,500
-----------
RETAILING--16.3%
34,400 Bed Bath & Beyond Inc.* ............................. 1,145,950
47,000 BJ's Wholesale Club Inc.* ........................... 1,448,186
15,000 Cost Plus Inc.* ..................................... 547,500
24,900 Ethan Allen Interiors Inc. .......................... 885,506
34,200 Family Dollar Stores Inc. ........................... 705,375
5,000 Lands End Inc.* ..................................... 384,688
37,400 Linens'n Things Inc.* ............................... 1,486,650
50,000 Sharper Image Corp.* ................................ 546,875
14,000 Tiffany & Co. ....................................... 833,000
30,000 Tuesday Morning Corp.* .............................. 690,000
10,000 Tweeter Home Entertainment Group Inc.* .............. 427,500
10,000 Valuevision International Inc., Cl. A.* ............. 326,875
17,800 Williams Sonoma Inc.* ............................... 956,750
-----------
10,384,855
-----------
SEMICONDUCTORS--11.4%
14,000 Altera Corporation* ................................. 680,750
11,000 Applied Micro Circuits Corp.* ....................... 855,937
19,000 Conexant Systems Inc.* .............................. 1,774,125
19,700 Dallas Semiconductor Corp. .......................... 1,159,838
16,400 Lattice Semiconductor Corp.* ........................ 580,150
29,500 Microchip Technology Incorporated* .................. 1,965,438
6,000 Vitesse Semiconductor Corp.* ........................ 275,250
-----------
7,291,488
-----------
8
<PAGE>
THE ALGER RETIREMENT FUND
ALGER SMALL CAP RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
October 31, 1999
SHARES COMMON STOCKS (CONTINUED) VALUE
- ------- --------
SEMICONDUCTOR
CAPITAL EQUIPMENT--6.0%
10,000 ASM Lithography Holding NV* ......................... $ 726,250
30,000 Atmi Inc.* .......................................... 808,125
20,000 DII Group Inc.* ..................................... 720,000
39,300 PRI Automation, Inc.* ............................... 1,576,913
----------
3,831,288
----------
TRANSPORTATION--2.1%
46,100 Forward Air Corporation* ............................ 1,357,069
----------
MISCELLANEOUS--.4%
31,300 Coinstar Inc.* ...................................... 238,663
----------
Total Common Stocks
(Cost $45,698,416) ................................. 55,498,156
----------
PRINCIPAL
AMOUNT
- ---------
SHORT-TERM CORPORATE NOTES--8.5%
$1,750,000 Atlantis One Funding Corp.,
5.30%, 11/15/99 ......................... 1,746,388
850,000 Ford Motor Credit Company,
5.23%, 11/16/99 ......................... 848,146
900,000 General Motors Acceptance Corp.,
5.25%, 11/3/99 .......................... 899,737
650,000 Hasbro Inc.,
5.27%, 11/15/99 ......................... 648,667
400,000 Holland Limited Securitization Inc.,
5.38%, 11/19/99(a) ...................... 398,925
900,000 Toyota Credit De Puerto Rico,
5.27%, 11/15/99 ......................... 898,154
-----------
Total Short-Term Corporate Notes
(Cost $5,440,017) ....................................... 5,440,017
-----------
Total Investments
(Cost $51,138,433)(b) ....................... 95.6% 60,938,173
Other Assets in Excess of Liabilities ........ 4.4% 2,772,517
----- -----------
Net Assets ................................... 100.0% $63,710,690
===== ===========
* Non-income producing security.
(a) Pursuant to Securities and Exchange Commission Rule 144A, these
securities may be sold prior to their maturity only to qualified
institutional buyers.
(b) At October 31, 1999, the net unrealized appreciation on investments,
based on cost for federal income tax purposes of $51,138,433, amounted
to $9,799,740 which consisted of aggregate gross unrealized
appreciation of $11,880,164 and aggregate gross unrealized depreciation
of $2,080,424.
See Notes to Financial Statements.
9
<PAGE>
THE ALGER RETIREMENT FUND
ALGER SMALL CAP RETIREMENT PORTFOLIO
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the year
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
--------------------------------------------------
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of year .................... $16.37 $18.00 $17.87 $17.92 $10.83
------- ------- ------- ------- -------
Net investment income (loss) ........... (0.12)(i) (0.08) (0.10) (0.05) (0.07)
Net realized and unrealized
gain on investments .................. 8.65 0.02 3.13 1.72 7.23
------- ------- ------- ------- -------
Total from investment
operations ...................... 8.53 (0.06) 3.03 1.67 7.16
Distributions from net
realized gains ....................... (2.08) (1.57) (2.90) (1.72) (0.07)
------- ------- ------- ------- -------
Net asset value,
end of year .......................... $22.82 $16.37 $18.00 $17.87 $17.92
======= ======= ======= ======= =======
Total Return 52.7% (1.8)% 19.0% 9.2% 66.2%
======= ======= ======= ======= =======
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted) .................... $63,711 $29,938 $31,499 $30,043 $23,002
======= ======= ======= ======= =======
Ratio of expenses to
average net assets ................. 1.02% 1.03% 1.06% 1.05% 1.13%
======= ======= ======= ======= =======
Ratio of net investment
income (loss) to
average net assets ................. (0.57%) (0.55%) (0.62%) (0.54%) (0.73%)
======= ======= ======= ======= =======
Portfolio Turnover Rate 193.32% 169.97% 134.25% 182.49% 104.84%
======= ======= ======= ======= =======
</TABLE>
(i) Amount was computed based on average shares outstanding during the
year.
See Notes to Financial Statements.
10
<PAGE>
ALGER MIDCAP GROWTH RETIREMENT PORTFOLIO
PORTFOLIO HIGHLIGHTS THROUGH OCTOBER 31, 1999 (UNAUDITED)
$10,000 HYPOTHETICAL INVESTMENT SINCE INCEPTION NOVEMBER 8, 1993
Alger MidCap Growth Retirement S&P MidCap 400 Index
11/8/93 10000 10000
10/31/94 11660 10292
10/31/95 17968 12475
10/31/96 19088 14637
10/31/97 24544 19417
10/31/98 27366 20721
10/31/99 38966 25087
The chart above illustrates the growth in value of a hypothetical $10,000
investment made in the Alger MidCap Growth Retirement Portfolio and the S&P
MidCap 400 Index on November 8, 1993, the inception date of the Alger MidCap
Growth Retirement Portfolio. Figures for the Alger MidCap Growth Retirement
Portfolio and the S&P MidCap 400 Index, an unmanaged index of common stocks,
include reinvestment of dividends.
PERFORMANCE COMPARISON THROUGH OCTOBER 31, 1999
Average Annual Returns
Since Inception
1 Year 5 Years 11/8/93
----------------------------------
Alger MidCap Growth
Retirement Portfolio 42.39% 27.29% 25.53%
S&P MidCap 400 Index 21.07% 19.50% 16.62%
-----------------------------------
THE PORTFOLIO'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE AND
REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE DOES NOT GUARANTEE
FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE AND THE
PORTFOLIO'S SHARES WHEN REDEEMED MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL
COST.
11
<PAGE>
THE ALGER RETIREMENT FUND
ALGER MIDCAP GROWTH RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS
October 31, 1999
SHARES COMMON STOCKS--91.3% VALUE
- ------- -------
ADVERTISING--2.4%
3,100 Lamar Advertising Co., Cl. A.* ...................... $ 167,400
11,000 Young & Rubicam Inc. ................................ 503,250
----------
670,650
AUTOMOTIVE--1.8%
8,700 Harley Davidson, Inc. ............................... 516,019
----------
BIO-TECHNOLOGY--5.6%
10,700 Biogen Inc.* ........................................ 793,138
5,700 Medimmune Inc.* ..................................... 638,400
1,800 Sepracor Inc.* ...................................... 149,737
----------
1,581,275
----------
BUSINESS SERVICES--6.0%
7,000 Cintas Corp. ........................................ 421,750
18,450 Fiserv Inc.* ........................................ 590,400
22,997 IMS Health Inc. ..................................... 666,913
----------
1,679,063
----------
COMMUNICATION EQUIPMENT--2.3%
3,300 Corning Inc. ........................................ 259,463
5,500 Flextronics International Ltd.* ..................... 390,500
----------
649,963
----------
COMMUNICATIONS--1.1%
8,642 At Home Corp. Series A.* ............................ 322,995
----------
COMPUTER RELATED &
BUSINESS EQUIPMENT--2.4%
7,400 Sanmina Corporation* ................................ 666,463
----------
COMPUTER SERVICES--7.3%
6,500 Amdocs Limited* ..................................... 180,781
21,600 CNET Inc.* .......................................... 1,019,250
4,000 eBay Inc.* .......................................... 540,500
2,000 Exodus Communications, Inc.* ........................ 172,000
830 Yahoo, Inc.* ........................................ 148,621
----------
2,061,152
----------
COMPUTER SOFTWARE--3.3%
2,600 CSG Systems International Inc.* ..................... 89,213
24,000 Intuit Inc.* ........................................ 699,000
2,600 Legato Systems Inc.* ................................ 139,750
----------
927,963
----------
ENERGY & ENERGY SERVICES--5.7%
8,500 Calpine Corp.* ...................................... 489,813
6,500 Devon Energy Corporation ............................ 252,688
7,200 EOG Resources Inc. .................................. 149,850
26,600 Nabors Industries Inc.* ............................. 603,487
8,500 Union Pacific Resources Group Inc. .................. 123,250
----------
1,619,088
----------
FINANCIAL SERVICES--4.6%
5,250 Charter One Financial Inc. .......................... 128,953
13,700 Kansas City Southern Industries Inc.. ............... 649,894
12,500 Paine Webber Group Inc. ............................. 509,375
----------
1,288,222
----------
FOODS & BEVERAGES--2.6%
3,000 Dean Foods Co. ...................................... 138,750
31,000 U.S. Foodservice* ................................... 594,812
----------
733,562
----------
INDUSTRIAL EQUIPMENT--2.1%
1,500 SPX Corp.* .......................................... 127,125
8,800 Waters Corp.* ....................................... 467,500
----------
594,625
----------
LEISURE & ENTERTAINMENT--1.9%
28,999 Mandalay Resort Group* .............................. 540,106
----------
MEDICAL SERVICES--1.8%
7,500 Express Scripts Inc., Cl. A.* ....................... 368,438
3,900 MedQuist Inc.* ...................................... 124,800
----------
493,238
----------
OIL & GAS--2.1%
17,200 B.J. Services Company* .............................. 590,175
----------
PHARMACEUTICALS--3.0%
18,600 Forest Laboratories, Inc.* .......................... 853,275
----------
RESTAURANTS & LODGING--2.1%
26,000 OutbackSteakhouse, Inc.*............................. 598,000
----------
RETAILING--11.8%
9,500 Abercrombie & Fitch Co., Cl. A.* .................... 258,875
4,500 Amazon.com Inc.* .................................... 317,813
21,700 Bed Bath & Beyond Inc.* ............................. 722,881
10,600 Best Buy Company Inc.* .............................. 588,963
9,000 BJ's Wholesale Club Inc.* ........................... 277,313
8,400 Gucci Group N.V ..................................... 678,300
9,000 Williams Sonoma Inc.* ............................... 483,750
----------
3,327,895
----------
SEMICONDUCTOR
CAPITAL EQUIPMENT--4.5%
5,300 ASM Lithography Holding NV* ......................... 384,912
3,900 Atmi Inc.* .......................................... 105,056
20,400 Teradyne, Inc.* ..................................... 785,400
----------
1,275,368
----------
SEMICONDUCTORS--16.9%
20,100 Altera Corporation* ................................. 977,362
1,800 Conexant Systems Inc.* .............................. 168,075
13,800 Linear Technology Corporation ....................... 965,137
9,000 Maxim Integrated Products, Inc.* .................... 710,437
13,600 Microchip Technology Incorporated* .................. 906,100
3,000 Vitesse Semiconductor Corp.* ........................ 137,625
11,600 Xilinx, Inc.* ....................................... 912,050
----------
4,776,786
----------
Total Common Stocks
(Cost $23,918,359)................................. 25,765,883
----------
12
<PAGE>
THE ALGER RETIREMENT FUND
ALGER MIDCAP GROWTH RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS (Continued)
October 31, 1999
PRINCIPAL
AMOUNT SHORT-TERM CORPORATE NOTES--9.0% VALUE
- --------- -------
$ 250,000 Atlantis One Funding Corp.,
5.32%, 11/15/99..................... $ 249,482
250,000 AT&T Corporation,
5.18%, 11/9/99...................... 249,712
625,000 Ford Motor Credit Company,
5.23%, 11/16/99..................... 623,637
300,000 General Motors Acceptance Corporation,
5.25%, 11/3/99...................... 299,913
500,000 Hasbro Inc.,
5.27%, 11/15/99..................... 498,975
625,000 Montauk Funding Corp.,
5.32%, 11/16/99 (a)................. 623,615
-----------
Total Short-Term Corporate Notes
(Cost $2,545,334)................... 2,545,334
-----------
Total Investments
(Cost $26,463,693)(b)................. 100.3% 28,311,217
Liabilities in Excess of Other Assets.. (0.3) (77,869)
----- -----------
Net Assets............................. 100.0% $28,233,348
===== ===========
* Non-income producing security.
(a) Pursuant to Securities and Exchange Commission Rule 144A, these
securities may be sold prior to their maturity only to qualified
institutional buyers.
(b) At October 31, 1999, the net unrealized appreciation on investments,
based on cost for federal income tax purposes of $26,463,693, amounted
to $1,847,524 which consisted of aggregate gross unrealized
appreciation of $2,680,072 and aggregate gross unrealized depreciation
of $832,548.
See Notes to Financial Statements.
13
<PAGE>
THE ALGER RETIREMENT FUND
ALGER MIDCAP GROWTH RETIREMENT PORTFOLIO
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the year
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
---------------------------------------------------------------------------
1999 1998 1997 1996 1995
--------- --------- -------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of year.............. $ 8.83 $ 11.36 $ 14.48 $ 16.34 $ 11.66
--------- --------- -------- --------- ---------
Net investment income (loss) .... (0.05)(i) (0.06)(i) (0.15) (0.07) (0.07)
Net realized and unrealized
gain on investments ........... 3.78 1.78 3.46 1.09 6.07
--------- --------- -------- --------- ---------
Total from investment
operations .............. 3.73 1.72 3.31 1.02 6.00
Distributions from net
realized gains ................ (0.76) (4.25) (6.43) (2.88) (1.32)
--------- --------- -------- --------- ---------
Net asset value,
end of year.................... $ 11.80 $ 8.83 $ 11.36 $ 14.48 $ 16.34
========= ========= ======== ========= =========
Total Return .................... 42.4% 11.5% 28.6% 6.2% 54.1%
========= ========= ======== ========= =========
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted) ......... $ 28,233 $ 6,667 $ 6,435 $ 9,726 $ 10,914
========= ========= ======== ========= =========
Ratio of expenses to
average net assets....... 1.23% 1.22% 1.31% 1.16% 1.23%
========= ========= ======== ========= =========
Ratio of net investment
income (loss) to
average net assets ...... (0.49%) (0.52%) (0.79%) (0.45%) (0.69%)
========= ========= ======== ========= =========
Portfolio Turnover Rate ... 165.68% 184.23% 183.31% 170.21% 132.74%
========= ========= ======== ========= =========
</TABLE>
(i) Amount was computed based on average shares outstanding during the
year.
See Notes to Financial Statements.
14
<PAGE>
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO
PORTFOLIO HIGHLIGHTS THROUGH OCTOBER 31, 1999 (Unaudited)
$10,000 HYPOTHETICAL INVESTMENT SINCE INCEPTION NOVEMBER 8, 1993
Alger Capital Appreciation Retirement S&P 500 Index
11/8/93 10000 10000
10/31/94 10080 10410
10/31/95 15564 13162
10/31/96 16515 16333
10/31/97 20820 21579
10/31/98 26672 26324
10/31/99 49169 33082
The chart above illustrates the growth in value of a hypothetical $10,000
investment made in the Alger Capital Appreciation Retirement Portfolio and the
S&P 500 Index on November 8, 1993, the inception date of the Alger Capital
Appreciation Retirement Portfolio. Figures for the Portfolio and the S&P 500
Index, an unmanaged index of common stocks, include reinvestment of dividends.
PERFORMANCE COMPARISON THROUGH OCTOBER 31, 1999
Average Annual Returns
Since Inception
1 Year 5 Years 11/8/93
-----------------------------------
Alger Capital Appreciation
Retirement Portfolio 84.34% 37.29% 30.51%
S&P 500 Index 25.67% 26.02% 22.15%
-----------------------------------
THE PORTFOLIO'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE
AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. PAST PERFORMANCE DOES NOT
GUARANTEE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE
AND THE PORTFOLIO'S SHARES WHEN REDEEMED MAY BE WORTH MORE OR LESS THAN
THEIR ORIGINAL COST.
15
<PAGE>
THE ALGER RETIREMENT FUND
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO
SCHEDULE OF INVESTMENTS
October 31, 1999
SHARES COMMON STOCKS--93.8% VALUE
- ------- -------
ADVERTISING--2.3%
25,000 Omnicom Group Inc. .................................. $2,200,000
-----------
AEROSPACE--1.1%
18,000 AlliedSignal Inc. ................................... 1,024,875
-----------
BIO-TECHNOLOGY--1.9%
23,100 Amgen Inc.* ......................................... 1,842,225
-----------
BROADCASTING--4.5%
30,600 Cablevision Systems Corp., Cl. A .................... 2,067,413
29,000 Clear Channel Communications Inc.* .................. 2,330,875
-----------
4,398,288
-----------
BUSINESS SERVICES--.3%
10,200 IMS Health Inc. ..................................... 295,800
-----------
COMMUNICATION EQUIPMENT--6.7%
39,000 Cisco Systems, Inc.* ................................ 2,886,000
28,500 Motorola, Inc. ...................................... 2,776,968
6,600 SDL Inc.* ........................................... 813,862
-----------
6,476,830
-----------
COMMUNICATIONS--13.2%
38,000 America Online Inc.* ................................ 4,928,125
16,000 AT&T Corp Liberty Media Group, Cl. A.* .............. 635,000
19,800 At Home Corp. Series A.* ............................ 740,025
25,000 Comcast Corp., Cl. A. Special ....................... 1,053,125
19,000 COX Communications Inc., Cl. A.* .................... 863,312
14,000 McLeodUSA Inc., Cl. A.* ............................. 624,750
9,300 Qualcomm Inc.* ...................................... 2,071,575
25,000 Sprint Corp. ........................................ 1,857,813
-----------
12,773,725
-----------
COMPUTER RELATED & BUSINESS
EQUIPMENT--4.2%
38,500 Sun Microsystems Inc.* .............................. 4,073,781
-----------
COMPUTER SERVICES--14.1%
40,500 CNET Inc.* .......................................... 1,911,094
33,100 eBay Inc.* .......................................... 4,472,638
26,700 Exodus Communications, Inc.* ........................ 2,296,200
27,452 Yahoo Inc.* ......................................... 4,915,624
-----------
13,595,556
-----------
COMPUTER SOFTWARE--5.5%
57,000 Intuit Inc.* ........................................ 1,660,125
39,800 Microsoft Corporation* .............................. 3,683,988
-----------
5,344,113
-----------
ENERGY & ENERGY SERVICES--3.1%
78,500 Halliburton Co. ..................................... 2,958,468
-----------
FINANCIAL SERVICES--5.7%
11,000 American Express Co. ................................ 1,694,000
60,750 Citigroup Inc. ...................................... 3,288,094
5,000 Morgan Stanley Dean Witter & Co. .................... 551,563
-----------
5,533,657
-----------
INSURANCE--.8%
7,375 American International Group, Inc. .................. 759,164
-----------
OIL & GAS--1.1%
20,500 Baker Hughes Inc. ................................... 572,719
15,000 B.J. Services Company* .............................. 514,687
-----------
1,087,406
-----------
PHARMACEUTICALS--3.2%
23,154 Bristol Myers Squibb Co. ............................ 1,778,517
32,500 Pfizer Inc. ......................................... 1,283,750
-----------
3,062,267
-----------
RETAILING--5.0%
14,700 Abercrombie & Fitch Co., Cl. A.* .................... 400,575
15,700 Amazon.com Inc.* .................................... 1,108,813
8,400 Costco Wholesale Corp.* ............................. 674,625
17,100 Home Depot, Inc. .................................... 1,291,050
23,800 Wal-Mart Stores Inc. ................................ 1,349,162
-----------
4,824,225
-----------
SEMICONDUCTOR
CAPITAL EQUIPMENT--5.4%
20,000 Applied Materials Inc.* ............................. 1,796,250
27,000 ASM Lithography Holding NV* ......................... 1,960,875
39,000 Teradyne, Inc.* ..................................... 1,501,500
-----------
5,258,625
-----------
SEMICONDUCTORS--15.7%
30,500 Altera Corporation* ................................. 1,483,063
11,900 Broadcom Corp., Cl. A.* ............................. 1,520,969
33,000 Conexant Systems Inc.* .............................. 3,081,375
18,300 Linear Technology Corporation ....................... 1,279,856
20,000 Micron Technology Inc.* ............................. 1,426,250
21,600 Texas Instruments, Incorporated ..................... 1,938,600
36,000 Vitesse Semiconductor Corp.* ........................ 1,651,500
35,600 Xilinx, Inc.* ....................................... 2,799,050
-----------
15,180,663
-----------
Total Common Stocks
(Cost $79,009,275) ................................. 90,689,668
-----------
PRINCIPAL
AMOUNT SHORT-TERM CORPORATE NOTES--4.8%
- ---------
$ 450,000 Atlantis One Funding Corp.,
5.30%, 11/15/99 ................................. 449,071
1,950,000 Ford Motor Credit Company,
5.23%, 11/16/99 ................................. 1,945,748
400,000 General Motors Acceptance Corporation,
5.25%, 11/3/99 .................................. 399,883
100,000 Kansas City Power & Light Co.,
5.32%, 11/4/99 .................................. 99,957
1,800,000 Toyota Credit De Puerto Rico,
5.27%, 11/15/99 ................................. 1,796,305
-----------
Total Short-Term Corporate Notes
(Cost $4,690,964) ............................... 4,690,964
-----------
Total Investments
(Cost $83,700,239)(a) ......................... 98.6% 95,380,632
Other Assets in Excess of Liabilities ........... 1.4 1,330,139
----- -----------
Net Assets ...................................... 100.0% $ 96,710,771
===== ===========
* Non-income producing security.
(a) At October 31, 1999, the net unrealized appreciation on investments,
based on cost for federal income tax purposes of $83,700,239, amounted
to $11, 680,393 which consisted of aggregate gross unrealized
appreciation of $13,209,340 and aggregate gross unrealized depreciation
of $1,528,947.
See Notes to Financial Statements
16
<PAGE>
THE ALGER RETIREMENT FUND
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO(I)
FINANCIAL HIGHLIGHTS
For a share outstanding throughout the year
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31,
---------------------------------------------------------------------------
1999 1998 1997 1996 1995
--------- --------- -------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of year.............. $ 8.98 $ 9.70 $ 9.88 $ 12.72 $ 10.08
--------- --------- -------- --------- ---------
Net investment income (loss) .... (0.09)(ii) (0.08)(ii) (0.10)(ii) (0.07) (0.19)
Net realized and unrealized
gain on investments ........... 7.63 2.96 2.51 0.83 5.30
--------- --------- -------- --------- ---------
Total from investment
operations .............. 7.54 2.88 2.41 0.76 5.11
Distributions from net
realized gains ................ (0.33) (3.60) (2.59) (3.60) (2.47)
--------- --------- -------- --------- ---------
Net asset value,
end of year.................... $ 16.19 $ 8.98 $ 9.70 $ 9.88 $ 12.72
========= ========= ======== ========= =========
Total Return .................... 84.3% 28.1% 26.1% 6.1% 54.4%
========= ========= ======== ========= =========
Ratios and Supplemental Data:
Net assets, end of year
(000's omitted) ......... $ 96,711 $ 5,587 $ 4,520 $ 6,703 $ 8,116
========= ========= ======== ========= =========
Ratio of expenses excluding
interest to average
net assets 1.28% 1.37% 1.47% 1.37% 1.43%
========= ========= ======== ========= =========
Ratio of expenses including
interest to average
net assets ...... 1.29% 1.44% 1.62% 1.44% 2.70%
========= ========= ======== ========= =========
Ratio of net investment
income (loss) to
average net assets (0.59%) (0.79%) (1.02%) (0.94%) (2.32%)
========= ========= ======== ========= =========
Portfolio Turnover Rate 155.40% 177.09% 159.56% 203.46% 188.53%
========= ========= ======== ========= =========
Amount of debt outstanding
at end of year -- -- $127,000 -- $302,600
========= ========= ======== ========= =========
Average amount of debt
outstanding during
the year $42,036 $49,890 $127,915 $62,130 $939,600
========= ========= ======== ========= =========
Average daily number of
shares outstanding
during the year 2,470,314 505,939 511,947 595,051 565,805
========= ========= ======== ========= =========
Average amount of debt
per share during
the year $ 0.02 $ 0.10 $ 0.25 $ 0.10 $ 1.66
========= ========= ======== ========= =========
</TABLE>
(i) Prior to April 12, 1996, the Alger Capital Appreciation Retirement
Portfolio was the Alger Defined Contribution Leveraged AllCap
Portfolio.
(ii)Amount was computed based on average shares outstanding during the
year.
See Notes to Financial Statements.
17
<PAGE>
THE ALGER RETIREMENT FUND
STATEMENTS OF ASSETS AND LIABILITIES
October 31, 1999
<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 .............. $71,409,792 $60,938,173 $28,311,217 $95,380,632
Cash ..................................................... 46,641 67,485 46,599 56,383
Receivable for investment securities sold ................ 2,048,666 2,957,755 285,012 3,057,162
Receivable for shares of beneficial interest sold ........ 28,483 61,086 271,778 16,844
Dividends receivable ..................................... 15,600 -- 1,012 15,872
Prepaid expenses ......................................... 9,562 8,300 6,930 18,920
----------- ----------- ----------- -----------
Total Assets ........................................... 73,558,744 64,032,799 28,922,548 98,545,813
----------- ----------- ----------- -----------
LIABILITIES:
Payable for investment securities purchased .............. 661,394 231,563 627,451 1,095,704
Payable for shares of beneficial interest redeemed ....... 67,205 10,858 14,861 569,535
Accrued investment management fees ....................... 43,920 41,843 18,061 64,678
Accrued expenses ......................................... 40,301 37,845 28,827 105,125
----------- ----------- ----------- -----------
Total Liabilities ...................................... 812,820 322,109 689,200 1,835,042
----------- ----------- ----------- -----------
NET ASSETS ............................................... $72,745,924 $63,710,690 $28,233,348 $96,710,771
=========== =========== =========== ===========
Net Assets Consist of:
Paid-in capital ........................................ $46,699,757 $44,618,657 $24,560,247 $83,272,273
Undistributed net investment income
(accumulated loss) ................................... (351,215) (926,145 (319,989) (641,486
Undistributed net realized gain ........................ 12,552,425 10,218,438 2,145,566 2,399,591
Net unrealized appreciation ............................ 13,844,957 9,799,740 1,847,524 11,680,393
----------- ----------- ----------- -----------
NET ASSETS ............................................... $72,745,924 $63,710,690 $28,233,348 $96,710,771
=========== =========== =========== ===========
Shares of beneficial interest outstanding--Note 6 ........ 4,236,283 2,792,009 2,393,358 5,971,702
=========== =========== =========== ===========
NET ASSET VALUE PER SHARE ................................ $ 17.17 $ 22.82 $ 11.80 $ 16.19
=========== =========== =========== ===========
*Identified cost ......................................... $57,564,835 $51,138,433 $26,463,693 $83,700,239
=========== =========== =========== ===========
</TABLE>
See Notes to Financial Statements.
18
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
STATEMENTS OF OPERATIONS
For the year ended October 31, 1999
<TABLE>
<CAPTION>
MIDCAP CAPITAL
GROWTH SMALL CAP GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- ------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Income:
Dividends .................. $ 230,607 $ 57,415 $ 25,455 $ 75,284
Interest ................... 190,540 140,832 85,656 173,348
------------ ------------ ------------ -----------
Total income .............. 421,147 198,247 111,111 248,632
------------ ------------ ------------ -----------
Expenses:
Management fees--Note 3(a) . 461,489 372,258 119,207 302,359
Shareholder servicing fees . 117,840 8,887 8,069 64,234
Interest on line of credit
utilized--Note 5 ............ -- -- -- 2,242
Custodian fees ............. 17,517 13,279 12,736 13,471
Transfer agent fees--
Note 3(c) ............... 2,500 2,500 2,500 2,500
Shareholder reports ........ 23,838 14,425 8,661 18,282
Professional fees .......... 9,951 10,486 7,956 13,714
Trustees' fees ............. 6,000 6,000 6,000 6,000
Miscellaneous .............. 18,995 20,824 18,293 36,336
------------ ------------ ------------ ------------
Total Expenses .......... 658,130 448,659 183,422 459,138
------------ ------------ ------------ ------------
NET INVESTMENT LOSS ......... (236,983) (250,412) (72,311) (210,506)
------------ ------------ ------------ ------------
REALIZED AND UNREALIZED
GAIN (LOSS) ON
INVESTMENTS:
Net realized gain (loss)
on investments ........... 12,595,530 9,628,923 1,917,140 2,007,349
Net change in unrealized
appreciation (depreciation)
on investments ........... 6,033,835 7,219,880 1,394,775 10,598,903
------------ ------------ ------------ ------------
Net realized and
unrealized gain (loss)
on investments .......... 18,629,365 16,848,803 3,311,915 12,606,252
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS . $ 18,392,382 $ 16,598,391 $ 3,239,604 $ 12,395,746
============ ============ ============ ============
</TABLE>
See Notes to Financial Statements.
19
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
ALGER CAPITAL APPRECIATION RETIREMENT PORTFOLIO
STATEMENT OF CASH FLOWS
For the year ended October 31, 1999
INCREASE (DECREASE) IN CASH:
Cash flows from operating activities:
Dividends received ................................... $ 60,320
Interest received .................................... 173,348
Interest paid ........................................ (2,305)
Operating expenses paid .............................. (299,747)
Purchase of investment securities .................... (125,454,532)
Purchase of short-term securities, net ............... (4,056,447)
Proceeds from disposition of investment securities ... 50,340,497
Other ................................................ (17,985)
-----------
Net cash used in operating activities ............... (79,256,851)
-----------
Cash flows from financing activities:
Distributions paid ................................... (824,545)
Proceeds from shares sold and distributions reinvested 95,819,461
Payments on shares redeemed .......................... (15,713,748)
-----------
Net cash provided by financing activities .......... 79,281,168
-----------
Net increase in cash .................................. 24,317
Cash--beginning of year ............................... 32,066
-----------
Cash--end of year ..................................... $ 56,383
===========
RECONCILIATION OF NET INCREASE IN NET
ASSETS TO NET CASH USED IN OPERATING ACTIVITIES:
Net increase in net assets resulting from operations . $ 12,395,746
Increase in investments .............................. (77,196,532)
Increase in receivable for investment securities sold (3,057,162)
Increase in dividends receivable ..................... (14,964)
Increase in payable for investment securities
purchased ........................................... 1,083,212
Net realized gain on investments ..................... (2,007,349)
Net increase in unrealized appreciation on
investments ......................................... (10,598,903)
Increase in accrued expenses and other liabilities ... 157,086
Net increase in other assets ......................... (17,985)
-----------
Net cash used in operating activities ............... $ (79,256,851)
===========
See Notes to Financial Statements.
20
<PAGE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
STATEMENTS OF CHANGES IN NET ASSETS
For the year ended October 31, 1999
<TABLE>
<CAPTION>
MIDCAP CAPITAL
GROWTH SMALL CAP GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net investment loss .................................... $ (236,983) $ (250,412) $ (72,311) $ (210,506)
Net realized gain on investments ....................... 12,595,530 9,628,923 1,917,140 2,007,349
Net change in unrealized appreciation (depreciation)
on investments ........................................ 6,033,835 7,219,880 1,394,775 10,598,903
----------- ---------- ----------- -----------
Net increase in net assets resulting
from operations ....................................... 18,392,382 16,598,391 3,239,604 12,395,746
Distributions to Shareholders:
Net realized gains .................................... (1,518,169) (3,871,054) (1,161,271) (824,545)
Net increase from shares of beneficial
interest transactions--Note 6 ......................... 15,675,939 21,045,643 19,488,397 79,552,891
----------- ---------- ----------- -----------
Total increase ....................................... 32,550,152 33,772,980 21,566,730 91,124,092
Net Assets:
Beginning of year ..................................... 40,195,772 29,937,710 6,666,618 5,586,679
----------- ---------- ----------- -----------
End of year ........................................... $72,745,924 $63,710,690 $28,233,348 $96,710,771
=========== =========== =========== ===========
Undistributed net investment income (accumulated loss).. $ (351,215) $ (926,145) $ (319,989) $ (641,486)
=========== =========== =========== ===========
</TABLE>
- --------------------------------------------------------------------------------
THE ALGER RETIREMENT FUND
STATEMENTS OF CHANGES IN NET ASSETS
For the year ended October 31, 1998
<TABLE>
<CAPTION>
MIDCAP CAPITAL
GROWTH SMALL CAP GROWTH APPRECIATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net investment loss ..................................... $ (19,255) $ (176,170) $ (34,779) $ (39,472)
Net realized gain on investments ........................ 1,413,023 4,024,832 1,177,672 858,170
Net change in unrealized appreciation (depreciation)
on investments ......................................... 4,786,718 (4,420,878) (406,271) 387,238
Net increase (decrease) in net assets resulting
from operations ........................................ 6,180,486 (572,216) 736,622 1,205,936
Distributions to Shareholders:
Net realized gains ..................................... (3,068,529) (2,665,137) (2,238,027) (1,478,868)
Net increase from shares of beneficial
interest transactions--Note 6 .......................... 14,161,744 1,675,769 1,732,580 1,339,209
Total increase (decrease) ............................. 17,273,701 (1,561,584) 231,175 1,066,277
Net Assets:
Beginning of year ...................................... 22,922,071 31,499,294 6,435,443 4,520,402
----------- ----------- ----------- -----------
End of year ............................................ $40,195,772 $29,937,710 $ 6,666,618 $ 5,586,679
=========== =========== =========== ===========
Undistributed net investment income (accumulated loss) .. $ (114,232) $ (675,733) $ (247,678) $ (430,980)
=========== =========== =========== ===========
</TABLE>
See Notes to Financial Statements.
21
<PAGE>
THE ALGER RETIREMENT FUND
NOTES TO FINANCIAL STATEMENTS
NOTE 1--General:
The Alger Retirement Fund (the "Fund"), is a diversified, open-end
registered investment company organized as a 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"). The investment objective of each Portfolio is
long-term capital appreciation. Each Portfolio seeks to achieve its objective by
investing primarily in equity securities.
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 distributions from net realized gains, offset by any
loss carryforward, 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.
(f) OTHER: These financial statements have been prepared using estimates
and assumptions that affect the reported amounts therein. Actual results may
differ from those estimates.
NOTE 3--Investment Management Fees and Other Transactions with Affiliates:
(a) INVESTMENT MANAGEMENT FEES: Fees incurred by each Portfolio, pursuant
to the provisions of its Investment Management Agreement with Fred Alger
Management, Inc. ("Alger Management"), are payable monthly and are 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
(b) BROKERAGE COMMISSIONS: During the year ended October 31, 1999, 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 $126,327, $98,245, $47,133 and
$83,900, 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 year ended October 31, 1999, each Portfolio incurred fees of
$2,500 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 October 31, 1999, Alger Management and its affiliates owned 889,982
shares, 466,206 shares, 894,824 shares and 682,013 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 year ended October 31, 1999:
Purchases Sales
--------- -----
Growth Portfolio ......................... $ 96,719,240 $ 82,246,781
Small Cap Portfolio ...................... 89,585,434 78,948,626
MidCap Growth Portfolio .................. 39,030,681 22,770,820
Capital Appreciation Portfolio ........... 126,537,744 53,394,302
22
<PAGE>
THE ALGER RETIREMENT FUND
NOTES TO FINANCIAL STATEMENTS (Continued)
NOTE 5--Lines of Credit:
The Capital Appreciation Portfolio has both committed and uncommitted lines
of credit with banks where it may borrow up to 1/3 of the value of its assets,
as defined, to purchase additional securities. To the extent the Capital
Appreciation Portfolio borrows under these lines, the Capital Appreciation
Portfolio must pledge securities with a total value of at least twice the amount
borrowed. Such borrowings have variable interest rates and are payable on
demand. For the year ended October 31, 1999, the Capital Appreciation Portfolio
had borrowings which averaged $42,036 at a weighted average interest rate of
5.26%.
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 year ended October 31, 1999, transactions of shares of
beneficial interest were as follows:
SHARES AMOUNT
--------- -----------
Growth Portfolio
Shares sold 1,735,529 $27,485,084
Dividends reinvested 91,899 1,518,169
Shares redeemed (841,672) (13,327,314)
--------- -----------
Net increase 985,756 $15,675,939
========= ===========
Small Cap Portfolio
Shares sold 1,661,996 $36,124,686
Dividends reinvested 178,225 3,871,054
Shares redeemed (876,494) (18,950,097)
--------- -----------
Net increase 963,727 $21,045,643
========= ===========
MidCap Growth Portfolio
Shares sold 2,250,079 $25,688,243
Dividends reinvested 99,680 1,161,271
Shares redeemed (711,449) (7,361,117)
--------- -----------
Net increase 1,638,310 $19,488,397
========= ===========
Capital Appreciation Portfolio
Shares sold 6,444,281 $95,011,629
Dividends reinvested 57,062 824,545
Shares redeemed (1,151,755) (16,283,283)
--------- -----------
Net increase 5,349,588 $79,552,891
========= ===========
During the year ended October 31, 1998, transactions of shares of
beneficial interest were as follows:
SHARES AMOUNT
--------- -----------
Growth Portfolio
Shares sold 1,675,676 $20,656,143
Dividends reinvested 234,212 3,061,151
Shares redeemed (785,459) (9,555,550)
--------- -----------
Net increase 1,124,429 $14,161,744
========= ===========
Small Cap Portfolio
Shares sold 548,888 $10,042,134
Dividends reinvested 135,827 2,664,934
Shares redeemed (605,971) (11,031,299)
--------- -----------
Net increase 78,744 $ 1,675,769
========= ===========
MidCap Growth Portfolio
Shares sold 67,899 $ 636,842
Dividends reinvested 225,973 2,207,761
Shares redeemed (105,276) (1,112,023)
--------- -----------
Net increase 188,596 $ 1,732,580
========= ===========
Capital Appreciation Portfolio
Shares sold 195,667 $ 1,756,200
Dividends reinvested 154,943 1,453,369
Shares redeemed (194,575) (1,870,360)
--------- -----------
Net increase 156,035 $ 1,399,209
========= ===========
23
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Board of Trustees
of The Alger Retirement Fund:
We have audited the statements of assets and liabilities, including the
schedules of investments, of The Alger Retirement Fund (a Massachusetts business
trust comprising, respectively, the Alger Growth Retirement, Alger Small Cap
Retirement, Alger MidCap Growth Retirement, and Alger Capital Appreciation
Retirement Portfolios) as of October 31, 1999, and the related statements of
operations and cash flows for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended and the financial
highlights for each of the five years in the period then ended. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned as of October 31, 1999, by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
each of the respective portfolios constituting The Alger Retirement Fund, as of
October 31, 1999, the results of their operations and cash flows for the year
then ended, the changes in their net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended, in conformity with generally accepted accounting
principles.
ARTHUR ANDERSEN LLP
New York, New York
December 7, 1999
24
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