[GRAPHIC OF ALLEGHANY FUNDS LOGO OMITTED]
Semi-Annual
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REPORT
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ALLEGHANY/MONTAG & CALDWELL GROWTH FUND
ALLEGHANY/CHICAGO TRUST GROWTH & INCOME FUND
ALLEGHANY/CHICAGO TRUST TALON FUND
ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND
ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND
ALLEGHANY/MONTAG & CALDWELL BALANCED FUND
ALLEGHANY/CHICAGO TRUST BALANCED FUND
ALLEGHANY/CHICAGO TRUST BOND FUND
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND
ALLEGHANY/CHICAGO TRUST MONEY MARKET FUND
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APRIL 30, 2000
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<PAGE>
[GRAPHIC OF ALLEGHANY FUNDS LOGO OMITTED]
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April 30, 2000
Dear Shareholder,
First and foremost, let me take this opportunity to thank you for entrusting us
with your investment needs. Your trust is the most important asset we hold here
at Alleghany Funds, particularly during this volatile time in the market.
One of our main initiatives for the new year is to bring you even closer to the
managers who run your funds. To this end, we have added a new feature to this
Semi-Annual Report: Portfolio Manager Commentaries. Along with our Web site and
quarterly FUNDFACTS, Portfolio Manager Commentaries are another means for our
managers to keep you in the loop.
Upon reviewing these Portfolio Manager Commentaries, one theme stood out for me.
Even when facing one of the most volatile markets in the last decade, our
managers have continued to manage their funds as they always have--with
discipline, with experience, and, most importantly, with strict adherence to an
investment process.
I believe that this is the single most important factor in the success of
Alleghany Funds. While the investment process may vary from style to style and
fund to fund, all of our managers employ a process that enables them to see
beyond the noise generated by market volatility and focus on the business at
hand.
As President of Alleghany Funds, I view our dedication to process as a
competitive edge. As a shareholder, I take a more personal view: our dedication
to process helps me sleep better at night. I hope you feel the same way.
Sincerely,
/S/ SIGNATURE
Kenneth Anderson
President
ALLEGHANY FUNDS ARE NO-LOAD MUTUAL FUNDS DISTRIBUTED BY PROVIDENT DISTRIBUTORS,
INC., KING OF PRUSSIA, PA 19406. THIS IS NOT AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY SHARES OF ANY OF THE FUNDS DESCRIBED. INVESTMENT RETURN AND
PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES,
WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. THIS
INFORMATION MUST BE ACCOMPANIED OR PRECEDED BY A PROSPECTUS.
Shareholder Services 800 992-8151 www.AlleghanyFunds.com
THE CHICAGO TRUST COMPANY [BULLET] MONTAG & CALDWELL [BULLET] VEREDUS ASSET
MANAGEMENT [BULLET] BLAIRLOGIE CAPITAL MANAGEMENT
<PAGE>
Table of Contents
SUMMARY INFORMATION 2
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PORTFOLIO MANAGER COMMENTARIES:
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ALLEGHANY/MONTAG & CALDWELL GROWTH FUND 5
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ALLEGHANY/CHICAGO TRUST GROWTH & INCOME FUND 6
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ALLEGHANY/CHICAGO TRUST TALON FUND 7
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ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND 8
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ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND 9
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ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND 10
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ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND 11
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ALLEGHANY/MONTAG & CALDWELL BALANCED FUND 12
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ALLEGHANY/CHICAGO TRUST BALANCED FUND 13
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ALLEGHANY/CHICAGO TRUST BOND FUND 14
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ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND 15
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ALLEGHANY/CHICAGO TRUST MONEY MARKET FUND 16
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SCHEDULE OF INVESTMENTS:
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ALLEGHANY/MONTAG & CALDWELL GROWTH FUND 17
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ALLEGHANY/CHICAGO TRUST GROWTH & INCOME FUND 18
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ALLEGHANY/CHICAGO TRUST TALON FUND 19
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ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND 20
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ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND 21
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ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND 23
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ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND 26
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ALLEGHANY/MONTAG & CALDWELL BALANCED FUND 30
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ALLEGHANY/CHICAGO TRUST BALANCED FUND 32
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ALLEGHANY/CHICAGO TRUST BOND FUND 35
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ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND 38
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ALLEGHANY/CHICAGO TRUST MONEY MARKET FUND 41
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STATEMENT OF ASSETS AND LIABILITIES 44
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STATEMENT OF OPERATIONS 48
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STATEMENT OF CHANGES IN NET ASSETS 52
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FINANCIAL HIGHLIGHTS 58
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NOTES TO FINANCIAL STATEMENTS 73
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THE CHICAGO TRUST COMPANY
With roots going back to 1887, Chicago Trust manages portfolios for mutual fund,
institutional and high net worth clients.The firm also provides investment,
trustee and administrative services for pension, profit sharing and 401(k)
plans.
MONTAG & CALDWELL, INC.
Founded in 1945 in Atlanta, Montag & Caldwell is one of the oldest and most
well-respected investment counseling firms in the Southeast. The firm manages
investments for institutions and retirement plans, as well as for individual
clients.
VEREDUS ASSET MANAGEMENT LLC
A specialist in small company growth stocks, Veredus manages institutional
accounts, individual client accounts and mutual funds and is based in
Louisville, Kentucky. The firm was founded by B. Anthony Weber, a former
principal with Fred Alger & Co., a well-known New York-based growth stock
research and investment firm.
BLAIRLOGIE CAPITAL MANAGEMENT
Based in Edinburgh, Scotland, Blairlogie specializes in managing international
and emerging market portfolios for institutions and mutual funds. The firm is a
registered investment advisor in the United States and the United Kingdom.
<PAGE>
ALLEGHANY FUNDS
-------------------
PERFORMANCE FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
SUMMARY INFORMATION
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/ CHICAGO TRUST GROWTH &
ALLEGHANY/MONTAG & CALDWELL GROWTH FUND INCOME FUND
CLASS N CLASS I
<S> <C> <C> <C>
TOTAL RETURNS:
Six Months ............ 5.27% 5.41% 13.26%
One Year .............. 10.16% 10.56% 14.59%
Three Year
Average Annual ..... 24.12% 24.50% 27.38%
Five Year
Average Annual ..... 27.32% N/A 27.43%
Average Annual
Since Inception .... 26.78% 25.41% 23.15%
Inception Date ........ 11/02/94 06/28/96 12/13/93
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
as of April 30, 2000 as of April 30, 2000
COMPANY AND % OF TOTAL NET ASSETS COMPANY AND % OF TOTAL NET ASSETS
<S> <C> <C> <C>
Pfizer, Inc. ........................... 6.34% EMC Corp. .............................. 4.90%
Hewlett-Packard Co. .................... 4.43% Cisco Systems, Inc. .................... 4.54%
Gillette Co. ........................... 4.29% Sun Microsystems, Inc. ................. 4.27%
Coca-Cola Co. .......................... 4.13% Nokia Corp., ADR ....................... 4.21%
Electronic Data Systems Corp. .......... 4.05% AES Corp. .............................. 3.57%
McDonald's Corp. ....................... 4.02% Sysco Corp. ............................ 3.39%
Lucent Technologies, Inc. .............. 3.84% Electronic Data Systems Corp. .......... 3.27%
Home Depot, Inc. ....................... 3.78% Computer Associates International, Inc. 3.00%
Johnson & Johnson ...................... 3.48% Harley-Davidson, Inc. .................. 2.99%
MCI WorldCom, Inc. ..................... 3.45% General Electric Co. ................... 2.96%
-----------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ALLEGHANY/CHICAGO TRUST TALON FUND ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND
<S> <C> <C>
TOTAL RETURNS:
Six Months 29.61% 10.34%
One Year 24.43% 2.94%
Three Year
Average Annual 12.97% N/A
Five Year
Average Annual 17.80% N/A
Average Annual
Since Inception 17.25% 0.98%
Inception Date 09/19/94 11/10/98
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
as of April 30, 2000 as of April 30, 2000
COMPANY AND % OF TOTAL NET ASSETS COMPANY AND % OF TOTAL NET ASSETS
<S> <C> <C> <C>
Newbridge Networks Corp. ............... 6.27% United Asset Management Co. ............ 3.43%
Magna International, Inc., Class A ..... 5.71% Cytec Industries, Inc. ................. 3.34%
CNF Transportation, Inc. ............... 5.49% ChoicePoint, Inc. ...................... 3.29%
Andrew Corp. ........................... 5.41% CCB Financial Corp. .................... 3.28%
Mattel, Inc. ........................... 4.88% Cullen/Frost Bankers, Inc. ............. 3.21%
Mentor Graphics Corp. .................. 4.34% Meredith Corp. ......................... 3.14%
Houghton Mifflin Co. ................... 4.01% First Charter Corp. .................... 3.04%
Unisys Corp. ........................... 3.82% Commercial Federal Corp. ............... 3.04%
Wallace Computer Services, Inc. ........ 3.72% Horace Mann Educators Corp. ............ 2.96%
ACNielsen Corp. ........................ 3.30% Sante Fe Snyder Corp. .................. 2.87%
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</TABLE>
2
<PAGE>
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<TABLE>
<CAPTION>
ALLEGHANY/VEREDUS AGGRESSIVE ALLEGHANY/ BLAIRLOGIE INTERNATIONAL
GROWTH FUND (A) DEVELOPED FUND (B)
CLASS N CLASS I
<S> <C> <C> <C>
TOTAL RETURNS:
Six Months ............ 59.41% 4.54% 4.67%
One Year .............. 108.58% 10.14% 10.44%
Three Year
Average Annual ..... N/A 12.07% 12.40%
Five Year
Average Annual ..... N/A 10.14% 10.46%
Average Annual
Since Inception .... 70.22% 10.71% 10.55%
Inception Date ........ 06/30/98 11/30/94 06/08/93
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
as of April 30, 2000 as of April 30, 2000
COMPANY AND % OF TOTAL NET ASSETS COMPANY AND % OF TOTAL NET ASSETS
<S> <C> <C> <C>
Varian Semiconductor Equipment Associates, Inc. 8.05% Nokia Oyj .................................. 3.71%
FileNET Corp. ................................. 4.23% Sweden Opal ................................ 2.45%
Electroglas, Inc. ............................. 3.60% Deutsche Telekom AG ........................ 2.33%
R&B Falcon Corp. .............................. 3.08% Nippon Telegraph & Telephone Corp. ......... 2.11%
Varian Inc. ................................... 3.05% Toyota Motor Corp. ......................... 2.03%
Marine Drilling Cos., Inc. .................... 2.87% Vodafone AirTouch Plc ...................... 1.89%
Tekelec ....................................... 2.73% Allianz AG ................................. 1.78%
Novoste Corp. ................................. 2.70% Murata Manufacturing Co., Ltd. ............. 1.76%
Cytyc Corp. ................................... 2.69% Fanuc, Ltd. ................................ 1.70%
Oxford Health Plans, Inc. ..................... 2.62% Telefonica SA .............................. 1.55%
--------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ALLEGHANY/BLAIRLOGIE EMERGING ALLEGHANY/MONTAG & CALDWELL
MARKETS FUND (C) BALANCED FUND
CLASS N CLASS I CLASS N CLASS I
<S> <C> <C> <C> <C>
TOTAL RETURNS:
Six Months ............ 16.51% 16.55% 4.14% 4.27%
One Year .............. 20.31% 20.57% 7.01% 7.32%
Three Year
Average Annual ..... (0.79)% (0.55)% 17.39% N/A
Five Year
Average Annual ..... 2.32% 2.61% 19.17% N/A
Average Annual
Since Inception .... (4.28)% 4.98% 19.00% 8.57%
Inception Date ........ 10/20/94 06/01/93 11/02/94 12/31/98
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
as of April 30, 2000 as of April 30, 2000
COMPANY AND % OF TOTAL NET ASSETS COMPANY AND % OF TOTAL NET ASSETS
<S> <C> <C> <C>
Samsung Electronics ............................... 3.60% Pfizer, Inc. ................................ 3.93%
Telecomunicacoes Brasileiras SA, Gillette Co. ................................ 2.62%
Pfd Block, SP ADR .............................. 3.41% Hewlett-Packard Co. ......................... 2.62%
Telefonos de Mexico SA, SP ADR .................... 3.19% Electronic Data Systems Corp. ............... 2.57%
Taiwan Fund, Inc. ................................. 3.15% Coca-Cola Co. ............................... 2.46%
Magyar Tavkozlesi, Rights ......................... 2.64% Circuit City Stores-Circuit City Group ...... 2.42%
Winbond Electronic Corp., GDR ..................... 2.62% Johnson & Johnson ........................... 2.42%
MSCI Taiwan OPALS ................................. 2.57% McDonald's Corp. ............................ 2.37%
Korea Electric Power Corp. ........................ 2.20% Lucent Technologies, Inc. ................... 2.27%
Turkiye Is Bankasi, Class C ....................... 2.12% Home Depot, Inc. ............................ 2.23%
Korea Fund ........................................ 1.77%
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<FN>
(a) Prior to December 7, 1998, the performance figures reflected are those of a
predecessor fund, Veredus Growth Fund.
(b) Prior to May 1, 1999, the performance figures reflected are those of a
predecessor fund, PIMCO International Developed Fund.
(c) Prior to May 1, 1999, the performance figures reflected are those of a
predecessor fund, PIMCO Emerging Markets Fund.
</FN>
</TABLE>
3
<PAGE>
ALLEGHANY FUNDS
-------------------
PERFORMANCE FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
SUMMARY INFORMATION - CONTINUED
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/CHICAGO TRUST BALANCED FUND ALLEGHANY/CHICAGO TRUST BOND FUND
<S> <C> <C>
TOTAL RETURNS:
Six Months .............. 8.41% 1.83%
One Year ................ 9.03% 1.35%
Three Year
Average Annual ....... 19.00% 5.79%
Five Year
Average Annual ....... N/A 6.58%
Average Annual
Since Inception ...... 17.99% 5.62%
Inception Date .......... 09/21/95 12/13/93
</TABLE>
<TABLE>
<CAPTION>
TOP TEN HOLDINGS
as of April 30, 2000 as of April 30, 2000
COMPANY AND % OF TOTAL NET ASSETS COMPANY AND % OF TOTAL NET ASSETS
<S> <C> <C> <C>
EMC Corp. ......................................... 2.90% Government National Mortgage Association
Cisco Systems, Inc. ............................... 2.67% 7.000%, 09/15/28, Pool #458926 ................. 3.55%
Nokia Corp., ADR .................................. 2.52% Federal National Mortgage Association
Sun Microsystems, Inc. ............................ 2.51% 7.500%, 02/01/30, Pool #529028 ................. 2.99%
Sysco Corp. ....................................... 2.42% Federal Home Loan Mortgage Corporation
AES Corp. ......................................... 2.31% 8.000%, 02/01/30, Pool #C00922 ................. 2.98%
Solectron Corp. ................................... 2.10% U.S. Treasury Bond 6.000%, 02/15/26 ............... 2.78%
Electronic Data Systems Corp. ..................... 2.05% Federal Home Loan Mortgage Corporation
Sybron International Corp. ........................ 2.00% 5.750%, 07/15/03, Debentures ................... 2.73%
Harley-Davidson, Inc. ............................. 1.93% Federal Home Loan Mortgage Corporation
7.500%, 11/01/29, Gold Pool #C32468 ............ 2.03%
U.S. Treasury Bond 7.125%, 02/15/23 ............... 1.97%
AT&T Corp. 6.000%, 03/15/09 ....................... 1.91%
Lukens, Inc. 7.625%, 08/01/04 ..................... 1.86%
Federal Home Loan Bank
6.500%, 11/15/06, Series PX02 .................. 1.84%
</TABLE>
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND
TOTAL RETURNS:
Six Months .............. 2.23%
One Year ................ (0.92)%
Three Year
Average Annual ....... 3.57%
Five Year
Average Annual ....... 4.02%
Average Annual
Since Inception ...... 3.49%
Inception Date .......... 12/13/93
TOP TEN HOLDINGS
as of April 30, 2000
COMPANY AND % OF TOTAL NET ASSETS
Evanston, G.O., Prerefunded 12/01/02,
6.100%, 12/01/09 ................................ 3.22%
Indianapolis Public Improvement Revenue,
Series B, 6.000%, 01/10/20 ...................... 3.20%
Phoenix Civic Improvement Corp., Water
System Revenue, Junior Lien 6.000%, 07/01/02 .... 3.19%
Pennsylvania Intergovernmental Cooperative
Authority, Special Tax Revenue, City of
Philadelphia Funding Program, Escrowed to
Maturity, 6.000%, 06/15/02 ...................... 3.17%
Texas Municipal Power Agency Revenue,
5.500%, 09/01/10 ................................ 3.17%
State of California, G.O., Series A39,
5.250%, 06/30/00 ................................ 3.12%
King County, Series A, G.O.,
5.800%, 01/01/04 ................................ 3.04%
New York State Dormitory Authority
Revenue, Series C, 5.100% 05/15/03 .............. 3.00%
Chicago Board of Education, School
Reform Board, Series A, G.O.
5.250%, 12/01/21 ................................ 2.89%
Salt River Project, Agricultural Improvement
and Power District Electric System Revenue
Refunding, Series A, 5.500%, 01/01/05 ........... 2.86%
4
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL GROWTH FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF RONALD CANAKARIS OMITTED]
Ronald E. Canakaris, CFA
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Montag & Caldwell Growth Fund, Class N and Class I, produced total
returns of 5.27% and 5.41%, respectively, for the period. In comparison, the
Fund's benchmark, the Standard & Poor's 500 Index ("S&P[REGISTERED MARK] 500
Index"), returned 7.20% while the Fund's peer group, as measured by the
Lipper Large-Cap Growth Fund Index, returned 16.31%. The Fund was adversely
affected by a lower-than-market allocation to the technology sector and a
higher concentration in the consumer staples area.
Q What strategies did you employ during
-------
the period?
A TECHNOLOGY. Escalating valuations, well beyond fair values and premiums, led
to the successive trimming and the eventual sale of Oracle and EMC Corp.
during the period. Price volatility in Lucent Technologies, Inc. (3.8% of
net assets) provided a buying opportunity in this leading supplier of
advanced telecommunications systems. We believe Lucent is well positioned to
benefit from heavy spending by telephone carriers in the industry. Buying
opportunities also led to additions to Solectron Corp. (3.1%) and Dell
Computer Corp. (2.6%).
CONSUMER PRODUCTS. Well-known, multinational consumer companies appear
well-positioned for accelerating earnings momentum as we approach the
summer. The continued weakness in these companies' stock prices led to
additional purchases of Coca-Cola Co. (4.1%), McDonald's Corp. (4.0%), and
PepsiCo, Inc. (2.1%). Home Depot's (3.8%) strong performance last year
caused us to trim the stock early in the period. Continued strong sales
results and the positive movement to digital technology in consumer
electronics prompted us to increase our exposure to Circuit City
Stores-Circuit City Group (3.3%).
FINANCIAL SERVICES. Higher interest rates caused the financial sector to
weaken, allowing us to add to Wells Fargo & Co. (2.7%) and purchase an
initial position in Citigroup, Inc. (2.1%).
HEALTH CARE. The performance of the health care sector remained neutral as
legislative pricing control concerns continue to linger. Buying
opportunities arose in Pfizer, Inc. (6.3%) and Johnson & Johnson (3.5%), and
the strong performance in Medtronic, Inc. (3.4%) forced us to trim our
holding slightly.
Q What other factors affected the Fund's
-------
performance?
A Stocks were adversely affected by rising interest rates and concerns about
inflation. For much of the period, stock market investors shunned most
sectors of the market except technology, believing that "new economy"
companies were the only ones likely to grow, regardless of the environment.
However, by mid-March, investor jitters also knocked down technology stocks,
which had risen to speculative heights.
Q What is your outlook?
-------
A The stock market's recent weakness is partly due to the increase in
short-term interest rates as engineered by the Federal Reserve Board (the
"Fed") to slow down inflation. Higher interest rates increase the costs of
borrowing for consumers and businesses and reduce the attractiveness of
stocks versus higher yielding bonds. Although the Fed has struggled to slow
the economy, we believe that the stock market should improve as investors
begin to believe that the Fed will be successful at influencing a soft
landing for the U.S. economy. In the meantime, we continue to navigate the
market volatility in search for opportunities, while remaining true to our
investment disciplines and philosophy. Global, leading market share
companies in the consumer, pharmaceutical, technology, financial and
industrial growth sectors are well-positioned to take advantage of enormous
longer-term opportunities deriving from the triumph of capitalism and
recovering global economies.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Technology 21%
Other Common Stocks 17%
Pharmaceuticals 12%
Retail 12%
Finance 10%
Consumer Non-Durables 8%
Telecommunications Equipment 6%
Food and Beverage 6%
Medical Supplies 6%
Cash and Other Net Assets 2%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/MONTAG & CALDWELL
GROWTH FUND--CLASS N
GROWTH OF $10,000
LIPPER ALLEGHANY/MONTAG
S&P[REGISTRATION LARGE-CAP GROWTH & CALDWELL GROWTH
MARK] 500 INDEX FUND INDEX FUND CLASS N SHARES
11/94 $10,000 $10,000 $10,000
04/95 11,046 10,690 10,999
10/95 12,641 12,691 13,187
04/96 14,380 14,119 15,065
10/96 15,685 15,207 17,131
04/97 17,992 16,561 19,245
10/97 20,720 19,441 22,925
04/98 25,381 23,480 27,690
10/98 25,277 23,176 27,027
04/99 30,916 29,771 33,408
10/99 31,761 31,787 34,958
04/00 34,041 36,973 36,802
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN CLASS N SHARES OF THE FUND ON
ITS INCEPTION DATE TO $10,000 INVESTMENTS MADE IN THE INDICES (S&P[REGISTERED
MARK] 500 INDEX AND LIPPER LARGE-CAP GROWTH FUND INDEX) ON THAT DATE. ALL
DIVIDENDS AND CAPITAL GAINS ARE REINVESTED. FURTHER INFORMATION RELATING TO THE
FUND'S PERFORMANCE, INCLUDING EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE
PROSPECTUS AND ELSEWHERE IN THIS REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF
FUTURE PERFORMANCE. INDICES ARE UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
5
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST GROWTH & INCOME FUND
PORTFOLIO MANAGERS COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTOS OF BERNARD MYSZKOWSKI AND RICHARD DRAKE OMITTED]
Bernard F. Myszkowski, CFA Richard S. Drake, CFA
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Chicago Trust Growth & Income Fund produced a total return of
13.26%. In comparison, its benchmark, the S&P[REGISTERED MARK] 500 Index,
returned 7.20% while the Lipper Large-Cap Fund Growth Index, a measure of
its peer group, returned 16.31%.
Q What factors affected the Fund's
-------
performance?
A Stocks were adversely affected by rising interest rates and concerns about
inflation. For much of the period, stock market investors shunned most
sectors of the market except technology, believing that "new economy"
companies were the only ones likely to grow, regardless of the environment.
However, by mid-March, investor jitters also knocked down technology stocks,
which had risen to unrealistic heights. As a result, the growth investing
style, that from a performance standpoint, had been so dominant over the
past several quarters, gave way to value investors toward the end of the
period.
Q What sectors performed well?
-----
A Despite the correction in March and April, technology had a very positive
influence on the Fund's performance during the period. Indeed, a number of
holdings performed so well that we had to trim them from the portfolio
because they exceeded our individual holding guideline. Our policy is that
no one stock should represent more than 5% of the Fund's assets.
Accordingly, we reduced our positions in EMC Corp., Sun Microsystems, Inc.
and Cisco Systems, Inc. (4.9%, 4.3% and 4.5% of net assets, respectively).
We like these securities and continue to hold positions in them. With the
gains from the realignment of the portfolio, we were able to add two new
technology/telecommunications companies to the Fund during the
quarter--Dell Computer Corp. and Nokia Corp. Dell Computer Corp. (2.2% of
net assets) manufactures computer equipment and markets directly to
customers including individual, corporate, government and educational
accounts. Although Dell was negatively impacted in late 1999 by a reluctance
by companies to purchase computers due to Y2K fears, the company is seeing a
gradual turnaround in sales orders. Nokia Corp. (4.2%) was added to the
portfolio, because it continues to be the dominant global player in wireless
handsets, a market that has significant growth potential.
Q What areas performed poorly?
-----
A During the period, the Fund's performance was hindered by poor returns of
securities in the financial sector. Several increases in short-term interest
rates by the Fed did not bode well for the sector as a whole. In addition,
we sold our holdings in Newell Rubbermaid as our research led us to believe
revenue and earnings growth were slowing. Although technology stocks
corrected sharply during March and April, the impact on the Fund was less
pronounced than our competition because we did not chase technology stocks
beyond what we thought were reasonable valuations.
Q What is your outlook?
-------
A We are committed to our long-term process, which is to purchase companies at
attractive prices that we believe have strong revenue and earnings growth
potential in fundamentally solid industries. For the long term, we believe
that our bottom-up approach and analysis of individual stocks across a wide
array of sectors should provide value to shareholders.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Technology 30%
Other Common Stocks 25%
Finance 12%
Consumer Durables 7%
Telecommunications Equipment 7%
Cash and Other Net Assets 5%
Retail 4%
Utility 4%
Consumer Non-Durables 3%
Food and Beverage 3%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/CHICAGO TRUST
GROWTH & INCOME FUND
GROWTH OF $10,000
S&P[REGISTRATION LIPPER ALLEGHANY/CHICAGO
MARK] 500 LARGE-CAP TRUST GROWTH &
INDEX GROWTH FUND INDEX INCOME FUND
12-93 $10,000 $10,000 $10,000
04-94 9,745 10,047 9,797
10-94 10,360 10,535 10,173
04-95 11,444 11,262 11,231
10-95 13,096 13,371 13,088
04-96 14,898 14,875 14,983
10-96 16,250 16,021 16,619
04-97 18,641 17,448 18,258
10-97 21,466 20,482 20,801
04-98 26,293 24,737 25,536
10-98 26,185 24,417 26,090
04-99 32,026 31,365 32,936
10-99 32,902 33,489 33,321
04-00 35,264 38,953 37,740
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN THE FUND ON ITS INCEPTION DATE
TO $10,000 INVESTMENTS MADE IN THE INDICES (S&P[REGISTERED MARK] 500 INDEX AND
LIPPER LARGE-CAP GROWTH FUND INDEX) ON THAT DATE. ALL DIVIDENDS AND CAPITAL
GAINS ARE REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S PERFORMANCE,
INCLUDING EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS AND ELSEWHERE
IN THIS REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE.
INDICES ARE UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
6
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST TALON FUND
PORTFOLIO MANAGERS COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTOS OF TERRY DIAMOND AND THYRA ZERHUSEN OMITTED]
Terry D. Diamond Thyra E. Zerhusen
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Chicago Trust Talon Fund produced a total return of 29.61%. In
comparison, its benchmark, the S&P[REGISTERED MARK] 400 Mid-Cap Index,
returned 21.26% while the Lipper Mid-Cap Value Index, a measure of its peer
group, returned 13.15%.
Q What factors affected your performance?
-----
A We maintained an underweighting in the technology sector, which may have
hindered performance early in the period, but proved to be positive for
performance in March and April when these stocks were volatile. Although we
like the superior unit and top-line growth offered by many technology
stocks, we have been concerned with valuation, hence our underweighted
position in this sector. We tend to select technology companies that are
selling at reasonable multiples of earnings. Indeed, our portfolio includes
companies with low price/earnings ("P/E") multiples in relation to their
expected growth. At April 30, 2000, the portfolio's P/E ratio was 15.2 times
estimated calendar 2000 earnings per share. This is an attractive valuation
for a group of stocks that is expected to have a projected earnings growth
rate of 19%. In comparison, the S&P[REGISTERED MARK] 500 Index has an
average P/E multiple of 23 and a projected earnings growth rate of 14.7%.
Another positive factor in the Fund's performance is the relative strength
of mid-cap stocks. Beginning with the second calendar quarter of 1999, the
S&P[REGISTERED MARK] 400 Mid-Cap Index began to outperform the
S&P[REGISTERED MARK] 500 Index, a trend that is continuing. For the one-year
period ended April 30, 2000, the S&P[REGISTERED MARK] 400 Mid-Cap Index was
up 23.52% versus 10.13% for the S&P[REGISTERED MARK] 500 Index.
Alleghany/Chicago Trust Talon Fund posted a total return of 24.43% for the
same period.
Q What sectors performed well?
-------
A Companies in a wide variety of sectors performed well. In the
pharmaceuticals sector, Elan Corp. (2.7% of net assets) was a strong
performer, as were American Power Conversion Corp. (2.8%), Newbridge
Networks Corp. (6.3%) and Tech Data Corp. (2.9%), three technology
companies. Elan Corp. is a worldwide pharmaceutical company with research
and development, manufacturing and marketing facilities in Ireland, the U.S.
and Israel. In recent years, the company has focused in the areas of
neurology, pain management and acute care. American Power Conversion Corp.
designs, develops and manufactures power protection solutions for computer
and electronic products, including surge protectors for personal computers
and other home electronic devices. Newbridge Networks Corp. designs,
manufactures and markets computer networks. Tech Data Corp. distributes
microcomputer hardware and software products to distributors and retailers
throughout the world. Towards the end of the period, we took some profits in
Newbridge Networks Corp. and American Power Conversion Corp., because we
believed that these two companies became overvalued based on our valuation
criteria. Although we like growth stocks, we don't want to overpay for them.
Q What is your outlook?
-------
A In our opinion, the domestic stock markets have recently evolved from being
dominated by an indexing and momentum investing style to a stock-picking
environment. Our style of in-depth analysis and frequent discussions and
visits with company managements should continue to benefit from this change.
While we are concerned about the recent market volatility, we are confident
that we have a well-positioned stock portfolio and securities with good
fundamentals.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Other Common Stocks 26%
Telecommunications Equipment 15%
Business Services 14%
Technology 13%
Transportation 8%
Automotive 6%
Printing and Publishing 6%
Retail 6%
Pharmaceuticals 5%
Cash and Other Net Assets 1%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/CHICAGO TRUST
TALON FUND
GROWTH OF $10,000
S&P[REGISTRATION MARK] ALLEGHANY/CHICAGO LIPPER
400 MID-CAP TRUST TALON MID-CAP
INDEX FUND VALUE INDEX
09-94 $10,000 $10,000 $10,000
10-94 9,921 10,250 9,968
04-95 10,551 10,766 10,489
10-95 12,025 12,189 11,451
04-96 13,695 14,580 13,174
10-96 14,111 15,420 13,733
04-97 15,082 16,935 14,475
10-97 18,721 20,582 17,579
04-98 22,307 21,320 19,858
10-98 19,974 18,413 16,281
04-99 23,738 19,624 18,145
10-99 24,180 18,840 17,782
04-00 29,321 24,419 20,120
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN THE FUND ON ITS INCEPTION DATE
TO $10,000 INVESTMENTS MADE IN THE INDICES (S&P[REGISTERED MARK] 400 MID-CAP
INDEX AND LIPPER MID-CAP VALUE INDEX) ON THAT DATE. ALL DIVIDENDS AND CAPITAL
GAINS ARE REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S PERFORMANCE,
INCLUDING EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS AND ELSEWHERE
IN THIS REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE.
INDICES ARE UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
7
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF PATRICIA FALKOWSKI OMITTED]
Patricia A. Falkowski
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Chicago Trust Small Cap Value Fund produced a total return of
10.34%. In comparison, its benchmark, the Russell 2000 Index, returned
18.72% while the Lipper Small-Cap Value Index, a measure of its peer group,
returned 10.25%.
Q What factors affected your
-------
performance?
A For much of the past six months, the value style continued to be out of
favor. However, "Beware the Ides of March" certainly applied this year. An
incredible surge in technology and biotechnology stocks took hold in
February, which powered the Nasdaq on to new highs in March. Then, almost as
abruptly, these high-flying sectors collapsed as "old era" industries such
as energy, consumer cyclicals and basic materials came back into favor with
investors. Volatility was the only reliable feature of the market during the
period.
Q What sectors performed well?
-------
What sectors performed poorly?
A Companies in a variety of sectors performed well during the period. Valero
Energy, ChiRex (2.8% of net assets) and LifePoint Hospitals were strong
performers. Valero Energy is an independent petroleum refiner and marketer
that owns and operates five refineries in Texas, Louisiana and New Jersey.
Valero, which produces gasoline, low-sulfur diesel, jet fuel and
petrochemicals, markets its products in 31 states and selected export
markets. ChiRex provides research and development and contract manufacturing
for pharmaceutical companies. The company owns a broad portfolio of process
chemistry patents. LifePoint Hospitals operates 23 hospitals located in
rural areas.
A number of companies in the portfolio were involved in transactions such as
mergers or acquisitions that generated material gains for the Fund. During
the period, U.S. Trust and CCB Financial Corp. (3.3%) both announced plans
to be acquired. Dexter Corp., a maker of specialty materials used in the
life sciences, food packaging and electronics industries, received an
unsolicited bid from a suitor. In addition, US Can is in the process of
going private, which has produced capital appreciation in the stock.
Holdings impeding the Fund's return include AnnTaylor Stores and Meredith
Corp. (3.1%), a media company based in Iowa. By the end of the six month
period, holdings in Ann Taylor Stores, Valero Energy, LifePoint Hospitals,
Dexter Corp., and US Can were liquidated.
Q What is your outlook?
-------
A Given the extreme polarization that existed during much of the period
between value and growth stocks, we view the market's volatile reaction to
news to be a forward-looking opportunity. We believe the valuation disparity
will cause many investors to at least rotate their portfolios, if not
broaden their interest in other sectors of the market where global
acceleration is creating exciting earnings prospects. Even with the recent
turmoil in the market, many areas of the stock market are still quite
expensive. However, other areas appear to offer excellent value. We believe
that financial services companies such as banks, savings and loans, finance
and leasing firms have reached compellingly low valuations. The stock prices
suggest that investors are anticipating a recession, which we do not
forecast at this time. We anticipate strong returns from our investments in
these low-priced shares as investors re-evaluate the attractiveness of
higher risk, highly valued growth stocks. Opportunities like this are rare
and we hope to take advantage of these unwarranted valuation disparities.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Other Common Stocks 30%
Banks 22%
Oil and Gas Extraction 10%
Chemicals 6%
Printing and Publishing 6%
Cash and Other Net Assets 6%
Industrial 5%
Insurance 5%
Real Estate Investment Trust 5%
Savings and Loans 5%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/CHICAGO TRUST
SMALL CAP VALUE FUND
GROWTH OF $10,000
RUSSELL 2000 ALLEGHANY/CHICAGO LIPPER
INDEX TRUST SMALL-CAP SMALL CAP
VALUE FUND VALUE INDEX
11-98 $10,000 $10,000 $10,000
01-99 11,324 9,944 10,458
04-99 11,517 9,854 10,499
07-99 11,878 9,975 11,247
10-99 11,487 9,193 10,223
01-00 13,333 9,319 10,532
04-00 13,637 10,144 11,271
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN THE FUND ON ITS INCEPTION DATE
TO $10,000 INVESTMENTS MADE IN THE INDICES (RUSSELL 2000 INDEX AND LIPPER
SMALL-CAP VALUE INDEX) ON THAT DATE. ALL DIVIDENDS AND CAPITAL GAINS ARE
REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S PERFORMANCE, INCLUDING
EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS AND ELSEWHERE IN THIS
REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE. INDICES ARE
UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
8
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND
PORTFOLIO MANAGERS COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTOS OF ANTHONY WEBER AND CHARLES McCURDY OMITTED]
B. Anthony Weber Charles P. McCurdy, Jr.
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Veredus Aggressive Growth Fund produced a total return of 59.41%,
significantly outperforming its benchmark, the Russell 2000 Index, which
returned 18.72% and the Lipper Small-Cap Growth Index, a measure of its peer
group, which returned 39.84%. The numbers are even more dramatic for the
past 12 months, when the Fund produced a total return of 108.58%, compared
to the Russell 2000 Index and the Lipper Small-Cap Growth Index, which
returned 18.42% and 65.67%, respectively.
Q What factors affected the Fund's
-------
performance?
A Stocks were adversely affected by rising interest rates and concerns about
inflation. For much of the period, stock market investors shunned most
sectors of the market except technology, believing that "new economy"
companies were the only ones likely to grow regardless of the environment.
However, by mid-March, investor jitters also knocked down technology stocks,
which had risen to unrealistic heights. As a result, the growth investing
style, from a performance standpoint, had been so dominant over the past
several quarters, gave way to value investors toward the end of the period.
The strong performance of the Fund was in large part attributable to the
Fund's technology holdings. Investors in the Fund should realize that
favorable conditions for technology stocks may not continue and may not be
repeated in the future.
Q What sectors performed particularly
-------
well?
A Despite the March/April sell-off, the largest contributors to the portfolio
during the period were still technology and telecommunications stocks. As
these shares moved up, we cut our exposure in these areas to reduce risk in
the portfolio. We are by no means moving out of technology; instead, we are
simply moving back to a more standard weighting for our style of investing.
Technology now composes approximately 35% of Gross Domestic Product ("GDP"),
up from 10% just ten years ago, a trend that will most likely continue.
However, the prices for many companies within this sector are simply ahead
of the fundamentals. The one area within technology where we continue to see
value is semiconductor capital equipment, which made up 18.6% of the
portfolio as of April 30, 2000. Another strong area for the portfolio was
the energy sector, particularly drilling companies. Our rationale behind
this shift in sector exposure relates to technology stocks becoming very
extended, but more specifically that a trading range in crude oil has been
established between $24 and $30. The price of crude peaked at $24 in 1997,
yet the current capacity of drillers is about 20% lower, suggesting higher
revenues and profits for oil service companies. Higher oil prices should
also enable the capital spending budgets of the major oil companies to be
sustained and even increased over the next couple of years, which in turn
should lead to increased earnings expectations in a sector that is
under-owned institutionally.
Q What is your outlook?
-------
A In a recent letter to shareholders, we suggested that volatility would
likely increase. That proved to be an understatement during the period. In
the first three months of 2000 alone, the Nasdaq experienced not one, but
four corrections of at least 10%. While this volatility is disconcerting, it
is likely to continue. In addition, the tremendous amount of capital that
has been made readily available for Internet companies is probably not going
to continue. Being invested in those companies that have a truly attainable
business model will be of paramount importance. That, plus the continuing
volatility, will likely place a higher value on stock picking, which we feel
is our strong suit.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Other Common Stocks 20%
Semiconductors 19%
Retail 11%
Oil and Gas Extraction 10%
Cash and Other Net Assets 10%
Computer Software 8%
Electronics 7%
Telecommunications Equipment 6%
Medical Technologies 5%
Industrial 4%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/VEREDUS
AGGRESSIVE GROWTH FUND
GROWTH OF $10,000
LIPPER
RUSSELL 2000 ALLEGHANY/VEREDUS SMALL-CAP
INDEX AGGRESSIVE GROWTH FUND GROWTH INDEX
06-98 $10,000 $10,000 $10,000
07-98 9,190 9,190 9,248
10-98 8,311 8,620 7,915
01-99 9,411 11,090 9,644
04-99 9,571 12,710 9,466
07-99 9,871 14,310 10,372
10-99 9,547 16,630 11,215
01-00 11,081 23,643 15,018
04-00 11,334 26,511 15,682
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN THE FUND ON ITS INCEPTION DATE
TO $10,000 INVESTMENTS MADE IN THE INDICES (RUSSELL 2000 INDEX AND LIPPER
SMALL-CAP GROWTH INDEX) ON THAT DATE. ALL DIVIDENDS AND CAPITAL GAINS ARE
REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S PERFORMANCE, INCLUDING
EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS AND ELSEWHERE IN THIS
REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE. INDICES ARE
UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
9
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF JAMES SMITH OMITTED]
James G. S. Smith
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A The Alleghany/Blairlogie International Developed Fund, Class N and Class I,
produced total returns of 4.54% and 4.67%, respectively, during the six
month period. In comparison, the MSCI EAFE Index, the Fund's benchmark,
returned 6.84%. The main factors behind the shortfall were poor stock
returns in UK, France and Finland, and the effect of cash balances while
markets rose during February and March. In addition, global equity markets
continued to experience huge short-term volatility through April, especially
in technology stocks.
Q Describe your view of the Asia/Pacific
-------
region of the world.
A As of April 30, 2000, roughly 29.7% of the portfolio was invested in Japan,
versus 27.1% for the EAFE index. The underlying trend indicates that the
economic recovery is intact; other signs, including the increase in
machinery orders and an anticipated GDP growth from 1.5% to 2.0%, are strong
signs of a recovery. This growth is likely to cascade to the corporate
sector with increased earnings. At this time, we prefer the broader index,
rather than the narrow market of Telecommunications-Media-Technology (TMT)
that dominated most of 1999. We believe that the old economy stocks are
offering good value and are neglected by investors. During much of the
period, excessive investor euphoria and an overwhelming supply of initial
public offerings kept us out of both Hong Kong and Singapore.
Q What is your view of Europe?
-------
A We remained overweighted in Germany, believing that it is demonstrating an
economic recovery that is consistently gaining momentum. This is an
important step because Germany is leading the recovery across Europe. We are
also overweighted in Ireland versus the Index as we believe Ireland offers
more reasonable valuations than its European counterparts. We were also able
to find positive purchases in Spain with utilities and telecommunications.
We added Nokia Oyj (3.7 % of net assets) from Finland, where we were able to
buy on weakness during the first quarter of 2000. In April, we trimmed
exposure across Continental Europe while raising our cash level. The Fund
remained underweight in the United Kingdom, where, in our opinion, there are
fewer opportunities for upside potential in earnings--a direct result of the
Bank of England's interest rate increases.
Q What is your outlook?
-------
A Although the Euro has continued to slump, we believe it will soon stabilize.
With the strong economic recovery and the European Currency Board working to
curb inflation, the fundamentals are there for upside appreciation. In Asia,
we remain confident in the markets, which have made a remarkable recovery
from the 1997-1998 crisis. Though we are usually fully invested, we are
maintaining a slightly higher cash position for the present time. We believe
that the market is volatile and there has been too much exuberance. This
will ultimately force the Fed to continue to increase interest rates unless
U.S. growth slows sharply. Indeed, we believe that the correction of the
Internet frenzy, with companies selling at huge multiples and having no
earnings, has not yet run its course. We believe that this year will
reaffirm the attributes of a diversified portfolio of high quality blue
chips. We are confident in our current portfolio and are glad to see a bit
of sobriety to return to the market, moving investors back to more
conventionally-valued stocks.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Finance 20%
Industrial 16%
Utilities 13%
Technology 11%
All Other Common Stocks 8%
Automobiles 6%
Oil & Gas Extraction 5%
Food & Beverage 5%
Pharmaceuticals 5%
Basic Materials 5%
Foreign Index Security 3%
Cash & Cash Equivalents 2%
Preferred Stocks 1%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/BLAIRLOGIE
INTERNATIONAL DEVELOPED FUND--CLASS I
GROWTH OF $1,000,000
ALLEGHANY/BLAIRLOGIE LIPPER
INTERNATIONAL DEVELOPED MSCI EAFE INTERNATIONAL
FUND CLASS I SHARES INDEX FUND INDEX
Jun-93 $1,000,000 $1,000,000 $1,000,000
Oct-93 1,074,050 1,082,040 1,127,420
Apr-94 1,152,570 1,142,260 1,209,660
Oct-94 1,199,760 1,191,260 1,257,130
Apr-95 1,214,390 1,206,080 1,195,470
Oct-95 1,245,270 1,186,830 1,251,260
Apr-96 1,423,740 1,343,630 1,402,600
Oct-96 1,373,450 1,311,100 1,409,240
Apr-97 1,406,180 1,331,690 1,532,210
Oct-97 1,424,990 1,371,800 1,597,600
Apr-98 1,729,760 1,583,570 1,861,640
Oct-98 1,628,810 1,504,120 1,671,820
Apr-99 1,808,000 1,733,940 1,906,710
Oct-99 1,907,650 1,850,570 2,057,130
Apr-00 1,996,750 1,974,930 2,336,281
THIS CHART COMPARES A $1,000,000 INVESTMENT MADE IN CLASS I SHARES OF THE FUND
ON ITS INCEPTION DATE TO $1,000,000 INVESTMENTS MADE IN THE INDICES (MSCI EAFE
INDEX AND LIPPER INTERNATIONAL FUND INDEX) ON THAT DATE. ALL DIVIDENDS AND
CAPITAL GAINS ARE REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S
PERFORMANCE, INCLUDING EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS
AND ELSEWHERE IN THIS REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE
PERFORMANCE. INDICES ARE UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
10
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF JAMES SMITH OMITTED]
James G. S. Smith
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A The Alleghany/Blairlogie Emerging Markets Fund, Class N and Class I,
produced total returns of 16.51% and 16.55%, respectively, during the six
month period. In comparison, the MSCI Emerging Market Free ("EMF") Index,
the Fund's benchmark, returned 13.87%. An overweighting in Taiwan and
Hungary helped, as did our bearish stance on Greece and South Africa. Also,
global equity markets continued to experience huge short-term volatility
through April, particularly in technology.
Q Describe your view of the Asia/Pacific
-------
region of the world.
A During the period, we made a shift from Latin America to Asia, specifically
Taiwan, China and Malaysia. The common thread with these three country
allocations is the planned changes to their representation in the EMF index.
China's weighting in the index will be significantly increased, Malaysia
will again have an assigned allocation and increases in Taiwan's
representation will occur in stages. Taiwan has demonstrated strong growth
with solid fundamentals, reinforced by a healthy economy with an expected
6.8% GDP growth this year and a 30% increase in corporate earnings. We
believe that China is trading cheap versus its expected long-term growth. In
addition, Asia ex-Japan is benefiting from Japan's economic recovery,
including anticipated GDP growth of 1.5% to 2.0%. However, our bearishness
on India was costly at the market level, as that market soared. Foreign
enthusiasm for Indian technology stocks rose to levels we consider to be
unjustified.
Q What is your view of Latin America?
-------
A We reduced our holdings in Latin America through profit taking. We are
currently overweighted in Brazil because the Brazilian government has done a
good job with fiscal reform, which may actually result in a surplus versus
the usual deficit. We are underweighted in Mexico, which we believe is more
vulnerable to a slowdown in the U.S.
Q And Eastern Europe?
-------
A On the European front, our holdings in Turkey were a result of our belief in
their rebounding economy. Despite a devastating earthquake, governmental
reforms, fiscal prudence and privatization plans paint a rosy picture for
the economy during the next quarters. In addition, Hungary and Poland are
benefiting from a strong German economy with regard to trade. Both countries
are working to stabilize their economy, by managing their deficits and
creating sensible budgets. Moreover, both are on the route to European
Monetary Union and the interest rate convergence theme should support these
markets in the medium term.
Q What is your outlook?
-------
A From a fundamental perspective, the outlook is very positive for emerging
markets. Economic growth is strong across all regions. We have concerns
about the extent to which some markets got caught up in the
technology/media/technology mania in recent months. However, we believe
that most of the risks to emerging markets are external. Specifically,
emerging markets are always vulnerable to developments in the U.S, be it
interest rate hikes, a GDP slowdown or a stock market correction. Indeed, we
believe that the correction of the Internet frenzy, with companies selling
at huge multiples and having no earnings, has not yet run its course. We
believe that this year will reaffirm the attributes of a diversified
portfolio of high quality companies. We are confident in our current
portfolio and are glad to see sobriety return to the market, moving
investors back to more conventionally-valued stocks. Nevertheless, we have
been trying to keep our cash levels above normal in the near term in
anticipation of volatility.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Utilities 18%
All Other Common Stocks 15%
Finance 14%
Preferred Stocks 11%
Industrial 11%
Technology 10%
Basic Materials 9%
Oil & Gas Extraction 5%
Cash & Cash Equivalents 4%
Foreign Index Security 3%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/BLAIRLOGIE
EMERGING MARKETS FUND--CLASS I
GROWTH OF $1,000,000
ALLEGHANY/BLAIRLOGIE MSCI EMERGING
EMERGING MARKETS MARKETS
FUND CLASS I SHARES FREE INDEX
Jun-93 $1,000,000 $1,000,000
Oct-93 1,255,220 1,294,600
Apr-94 1,451,780 1,404,250
Oct-94 1,711,690 1,674,680
Apr-95 1,230,100 1,336,760
Oct-95 1,237,060 1,349,320
Apr-96 1,390,900 1,529,000
Oct-96 1,286,280 1,436,830
Apr-97 1,422,570 1,594,610
Oct-97 1,246,550 1,314,950
Apr-98 1,371,640 1,362,840
Oct-98 902,252 907,486
Apr-99 1,160,550 1,223,940
Oct-99 1,200,610 1,312,390
Apr-00 1,399,249 1,494,422
THIS CHART COMPARES A $1,000,000 INVESTMENT MADE IN CLASS I SHARES OF THE FUND
ON ITS INCEPTION DATE TO A $1,000,000 INVESTMENT MADE IN THE INDEX (MSCI
EMERGING MARKETS FREE INDEX) ON THAT DATE. ALL DIVIDENDS AND CAPITAL GAINS ARE
REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S PERFORMANCE, INCLUDING
EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS AND ELSEWHERE IN THIS
REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE. INDICES ARE
UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
11
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL BALANCED FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF RONALD CANAKARIS OMITTED]
Ronald E. Canakaris, CFA
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Montag & Caldwell Balanced Fund, Class N and Class I produced
total returns of 4.14% and 4.27%, respectively, during the six month period.
In comparison, its benchmark, a 60%/40% blend of the S&P[REGISTERED MARK]
500 Index and Lehman Brothers Government/Corporate Bond Index, returned
5.07% while the Lipper Balanced Fund Index, a measure of its peer group,
returned 5.20%.
Q What areas of strength did you see
-------
during the period?
A The bond portion of the Fund provided some pleasant surprises. Although the
Fed raised short-term interest rates three times during the period, yields
on long-term Treasury bonds actually fell. The federal budget surplus has
caused the government to buy back bonds to retire debt, particularly
long-term debt that offers the greatest potential interest savings. The
government has conducted "reverse auctions" where it is willing to pay a
premium to retire these bonds prior to maturity. This caused Treasury bond
prices to rise and yields to fall. The portfolio benefited from this unusual
event because of its heavy weighting in long-term Treasury bonds. In
addition, the Fund also benefited from the unusually large extra yield
offered by long-term corporate bonds compared to comparably maturing
Treasury securities. Meanwhile, mortgage-backed securities produced strong
returns, as the rising interest rate environment made it unlikely that
homeowners would refinance their debt.
Q What stock market holdings performed
-------
well?
A Areas such as technology, telecommu-nications and energy performed
particularly well. Technology stocks rose sharply between November 1 and
March 10, selling off for the remainder of the period. Nevertheless, the
overall performance for the six month period was still very positive.
Telecommunications stocks continue to benefit from global growth and the
strengthening economies of Europe and Asia.
Q Where do you see buying opportunities?
-------
A Price volatility in Lucent Technologies (2.3% of net assets) provided a
buying opportunity in this leading supplier of advanced telecommunications
systems. We believe Lucent is well positioned to benefit from heavy spending
by telephone carriers in the industry. Buying opportunities also led to
additions to Solectron Corp. (2.2%) and Dell Computer Corp. (1.6%).
Well-known, multinational consumer companies appear well-positioned for
accelerating earnings momentum as we enter the second quarter. The continued
weakness in these companies' stock prices led to additional purchases of
Coca-Cola Co. (2.5%), McDonald's Corp. (2.4%) and PepsiCo, Inc. (1.3%). The
performance of the health care sector remained neutral as legislative
pricing control concerns continue to linger. Buying opportunities arose in
Pfizer, Inc. (3.9%) and Johnson & Johnson (2.4%), while the strong
performance in Medtronic, Inc. (1.9%) forced us to trim our holding
slightly.
Q What is your outlook?
-------
A We continue to navigate the stock market volatility in search for
opportunities, while remaining true to our investment disciplines and
philosophy. Global, leading market-share companies in the consumer,
pharmaceutical, technology, financial and industrial growth sectors are
well-positioned to take advantage of enormous longer-term opportunities
deriving from the triumph of capitalism and recovering global economies. In
the bond market, we are closely monitoring the relative value of the various
bond sectors and anticipate increasing our position in agency or corporate
bonds. Our portfolio duration remains slightly longer than the benchmark,
reflecting our view that interest rates are likely to fall as the Fed
eventually slows the U.S. economy.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Common Stocks 62%
U.S Government and
Agency Obligations 15%
Corporate Notes and Bonds 10%
Cash and Other Net Assets 10%
Asset-Backed Securities 3%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/MONTAG & CALDWELL
BALANCED FUND--CLASS N
GROWTH OF $10,000
60% S&P[REGISTRATION MARK]
500 INDEX/
LIPPER BALANCED 40% LEHMAN BROTHERS ALLEGHANY/MONTAG
FUND INDEX GOVERNMENT CORPORATE & CALDWELL BALANCED
BOND INDEX FUND CLASS N SHARES
11-94 $10,000 $10,000 $10,000
04-95 10,652 10,909 10,817
10-95 11,759 12,229 12,375
04-96 12,674 13,228 13,446
10-96 13,462 14,238 14,895
04-97 14,397 15,561 16,071
10-97 16,168 17,469 18,509
04-98 18,153 20,055 20,979
10-98 17,887 20,519 21,185
04-99 20,173 23,209 24,292
10-99 20,132 23,537 24,962
04-00 21,179 24,693 25,994
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN CLASS N SHARES OF THE FUND ON
ITS INCEPTION DATE TO $10,000 INVESTMENTS MADE IN THE INDICES (60%
S&P[REGISTERED MARK] 500 INDEX/40% LEHMAN BROTHERS GOVERNMENT CORPORATE BOND
INDEX AND LIPPER BALANCED FUND INDEX) ON THAT DATE. ALL DIVIDENDS AND CAPITAL
GAINS ARE REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S PERFORMANCE,
INCLUDING EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS AND ELSEWHERE
IN THIS REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE.
INDICES ARE UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
12
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BALANCED FUND
PORTFOLIO MANAGERS COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTOS OF BERNARD MYSZKOWSKI AND THOMAS MARTHALER OMITTED]
Bernard F. Myszkowski, CFA Thomas J. Marthaler, CFA
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Chicago Trust Balanced Fund produced a total return of 8.41%. In
comparison, its benchmark, a 60%/40% blend of the S&P[REGISTERED MARK] 500
Index and Lehman Brothers Aggregate Bond Index, returned 5.03% while the
Lipper Balanced Fund Index, a measure of its peer group, returned 5.20%.
Q What factors affected the Fund's
-------
performance?
A Both stocks and bonds were adversely affected by rising interest rates and
concerns about inflation. For much of the period, stock market investors
shunned most sectors of the market except technology, believing that "new
economy" companies were the only ones likely to grow regardless of the
environment. However, by mid-March, investor jitters also knocked down
technology stocks, which had risen to unrealistic heights. The bond market
was under pressure as the Fed continued to raise short-term interest rates
in an effort to slow the economy.
Q What stock market holdings performed
-------
well?
A Despite the correction that took place this spring, technology was by far
the best performing stock sector, with the Nasdaq index up 30.14%. Indeed,
our holdings in EMC Corp., Sun Microsystems, Inc. and Cisco Systems, Inc.
(2.9%, 2.5% and 2.7% of net assets, respectively) performed particularly
well. To diversify the portfolio and reduce risk, we trimmed these positions
back as the market value of the stocks rose. The gains were invested into
two new technology/telecommunications holdings--Dell Computer Corp. (1.6% of
assets) and Nokia Corp. (2.5%), a dominant player in wireless handsets, a
market that we believe has significant growth potential. Despite the major
correction that occurred during the latter half of March and April, our Fund
was well-positioned to handle the sudden sentiment change. Although many of
our holdings did not fare as well as in prior time periods, their
fundamentals remained strong and their downturns were considerably less
severe than many of the holding of other Fund companies.
Q How did bonds perform during the
-------
period?
A The fixed income portion of the Fund, which accounted for 36.5% of the
portfolio during the period, saw an unusual divergence in performance
between long-term U.S. Treasury bonds and the rest of the bond market.
Because of the federal budget surplus and the government's plan to buy back
long-term U.S. Treasury bonds, the 30-year Treasury bond performed extremely
well, up 4.21% for the period. Indeed, the normally staid long-term
government bond performed almost like a technology stock in that its
performance for the period was so much better than other asset classes. In
comparison, high-grade corporate bonds, those issued by blue chip companies
with solid financial strength, returned 0.12% during the period.
Mortgage-backed securities produced total returns of 1.26%, as investors
turned their attention to the long-term U.S. Treasury market.
Q What is your outlook?
-------
A As the supply of Treasury bonds continues to diminish, the price of these
bonds will likely rise to reflect their scarcity, leaving relative bargains
available in corporate bonds and mortgage-backed securities. We expect to
continue to look for opportunities to invest in the high-quality corporate
market as well as the mortgage-backed sector. As for the stock market, we
expect to remain broadly diversified, which is a good way to insulate the
portfolio against the extreme market volatility that we have recently
witnessed. Indeed, a balanced fund offers a timely benefit: the ability to
reduce volatility by blending stocks and bonds, two asset classes with
different risk and return characteristics.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Common Stocks 61%
U.S Government and
Agency Obligations 21%
Corporate Notes and Bonds 13%
Cash and Other Net Assets 3%
Non-Agency/CMO Mortgage
Securities 1%
Yankee Bonds 1%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/CHICAGO TRUST
BALANCED FUND
GROWTH OF $10,000
60% S&P[REGISTRATION MARK] 500 INDEX/ ALLEGHANY/CHICAGO
40% LEHMAN BROTHERS LIPPER BALANCED TRUST BALANCED
AGGREGATE BOND INDEX FUND INDEX FUND
09-95 $10,000 $10,000 $10,000
04-96 10,817 10,751 10,893
10-96 11,625 11,420 11,847
04-97 12,708 12,213 12,720
10-97 14,237 13,715 14,229
04-98 17,439 15,399 16,362
10-98 17,368 15,511 16,862
04-99 19,706 17,494 19,659
10-99 20,016 17,458 19,772
04-00 20,993 18,366 21,434
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN THE FUND ON ITS INCEPTION DATE
TO $10,000 INVESTMENTS MADE IN THE INDICES (60% S&P[REGISTERED MARK] 500
INDEX/40% LEHMAN BROTHERS AGGREGATE BOND INDEX AND LIPPER BALANCED FUND INDEX)
ON THAT DATE. ALL DIVIDENDS AND CAPITAL GAINS ARE REINVESTED. FURTHER
INFORMATION RELATING TO THE FUND'S PERFORMANCE, INCLUDING EXPENSE
REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS AND ELSEWHERE IN THIS REPORT.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE. INDICES ARE UNMANAGED
AND INVESTORS CANNOT INVEST IN THEM.
13
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BOND FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF THOMAS MARTHALER OMITTED]
Thomas J. Marthaler, CFA
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A For the six month period, Alleghany/Chicago Trust Bond Fund produced a total
return of 1.83%. In comparison, the Lehman Brothers Aggregate Bond Index
posted a 1.42% total return for the same period, while the Lipper
Intermediate Investment Grade Index, a measure of the Fund's peer group,
returned 0.99%. For the 12 months ended April 30, 2000, the Fund's total
return was 1.35%, while the Lehman Brothers Aggregate Bond Index returned
1.26% and the Lipper Intermediate Investment Grade Index returned 0.41%.
Q What factors affected your performance?
-------
A The Fed raised short-term interest rates three times during the period for a
total of 0.75%. The Fed might have raised rates further in 1999, but it was
concerned about the impact of lower liquidity on Y2K, which turned out to be
a non-event. Despite the Fed's efforts to slow the economy, Gross Domestic
Product rose at 7.3% during the fourth quarter of 1999, followed by 5.4%
during the first quarter of 2000. These growth rates have caused investors
to worry about inflation. Indeed, the Consumer Price Index rose 0.4% in
March, the largest monthly gain in five years. Because of this environment,
it was our decision to maintain a shorter-than-average duration, which
helped our relative performance. A shorter duration bond portfolio is less
sensitive to changes in interest rates. Since bond prices decline when
interest rates rise, a shorter duration is an advantageous position.
Q What sectors of the bond market
-------
performed well? What sectors performed poorly?
A Most bond market sectors did not fare well during the period, as investors
appeared to associate them with the "old economy"--anything unrelated to
technology and the Internet. High-grade corporate bonds, those issued by
blue chip companies with solid financial strength, returned just 0.12%
during the period. High-yield bonds issued by companies with weaker credit
ratings performed even worse, as the total return for high-yield "junk"
bonds was 0.08%. Mortgage-backed securities produced returns of 1.26%, as
investors turned their attention to the long-term U.S. Treasury market,
which produced the best performance for the period.
Q Why did U.S. Treasury bonds perform
-------
so well?
A With the U.S. economy continuing to grow at a rapid pace, bond investors
(and Washington politicians) project that the ballooning U.S. budget
surpluses will be used to extinguish and repurchase trillions of dollars of
U.S. Treasury obligations, resulting in a scarcity of longer-term U.S.
Treasury bonds. As a result, the benchmark 30-year bond returned 4.21% for
the six month period, despite three short-term interest rate hikes by the
Fed, in its attempt to gradually slow economic growth and contain inflation.
Q What is your outlook?
-------
A Although corporate bonds and mortgage-backed securities have underperformed
Treasury securities, they currently offer very attractive relative yields
when compared to U.S. Treasury bonds. With yields in the 8% area, we believe
opportunities currently available in the corporate and mortgage-backed
securities sectors will handsomely reward bond investors with patience and a
longer-term horizon. In the meantime, the federal government's budget
surplus for fiscal year 2000 is likely to be larger than expected,
suggesting more aggressive buybacks of outstanding debt. We expect continued
market volatility until after the November election as various forces debate
the merits of retiring U.S. Treasury debt. In addition, we expect the Fed to
continue to raise interest rates until it is satisfied that it is able to
control inflation.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
U.S Government and
Agency Obligations 48%
Corporate Notes and Bonds 40%
Cash and Other Net Assets 7%
Yankee Bonds 3%
Non-Agency/CMO Mortgage
Securities 2%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/CHICAGO TRUST
BOND FUND
GROWTH OF $10,000
LEHMAN BROTHERS LIPPER INTERMEDIATE ALLEGHANY/CHICAGO
AGGREGATE INVESTMENT TRUST BOND
BOND INDEX GRADE INDEX FUND
12-93 $10,000 $10,000 $10,000
04-94 9,507 9,524 9,682
10-94 9,535 9,537 9,677
04-95 10,203 10,121 10,307
10-95 11,026 10,885 11,117
04-96 11,085 10,930 11,169
10-96 11,671 11,465 11,758
04-97 11,870 11,641 11,972
10-97 12,709 12,388 12,797
04-98 13,164 12,771 13,211
10-98 13,895 13,378 13,778
04-99 13,990 13,493 13,985
10-99 13,969 13,416 13,919
04-00 14,167 13,549 14,174
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN THE FUND ON ITS INCEPTION DATE
TO $10,000 INVESTMENTS MADE IN THE INDICES (LEHMAN BROTHERS AGGREGATE BOND INDEX
AND LIPPER INTERMEDIATE INVESTMENT GRADE INDEX) ON THAT DATE. ALL DIVIDENDS AND
CAPITAL GAINS ARE REINVESTED. FURTHER INFORMATION RELATING TO THE FUND'S
PERFORMANCE, INCLUDING EXPENSE REIMBURSEMENTS, IS CONTAINED IN THE PROSPECTUS
AND ELSEWHERE IN THIS REPORT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE
PERFORMANCE. INDICES ARE UNMANAGED AND INVESTORS CANNOT INVEST IN THEM.
LEHMAN BROTHERS AGGREGATE
BOND INDEX RETURNS
10/31/99-4/30/00
---------------------------------
U.S. Government ......... 2.25%
Corporate ............... 0.11%
High Yield .............. 0.08%
Mortgage-Backed ......... 1.26%
Asset-Backed ............ 1.49%
Emerging Markets ........ 12.82%
14
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF DAWN DAGGY-MANGERSON OMITTED]
Dawn Daggy-Mangerson
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Chicago Trust Municipal Bond Fund provided a total return of 2.23%
during the period. In comparison, the benchmark Lehman Brothers Municipal
Five-Year General Obligations Bond Index returned 1.16%. In addition, the
Fund's peer group as measured by the Lipper Intermediate Municipal Fund
Index returned 1.73%.
Q What factors affected your
-------
performance?
A As in other markets, the municipal market is subject to the pressures
brought on by supply and demand imbalances. New issue supply has remained
well below average, due primarily to the lack of refunding issues. At the
same time, there was strong retail demand for municipal bonds as tax savvy
investors looked for alternatives outside the equity makets. An investor in
the top federal tax bracket, who also pays state income tax, would need an
alternative taxable investment yielding nearly 9% to match the municipal
bond offering. Scarce supply coupled with strong retail demand allowed the
municipal market to maintain a firmness that was not present in the equity
and corporate bond markets during this period. Unlike high-grade corporate
bonds, mortgage-backed securities and junk bonds, municipal bond prices
actually rose during the period--particularly longer maturity bond prices.
Q What strategies did you employ?
-------
A The Fund's investment strategy focuses on security selection, duration
management and yield-curve positioning. In addition, since the beginning of
the year, there has been some restructuring of the Fund to reposition some
of its assets along the curve to take advantage of better-structured
securities and reduce its overweighting in the intermediate portion of the
curve. The restructuring has had a positive impact on the Fund's
performance.
SECURITY SELECTION. The Fund can select securities issued throughout the
U.S. that offer a variety of credit ratings, maturities, coupons and yields.
Some bonds are insured by private insurance companies, boosting their
ratings to AAA. Others are not insured, but still offer high credit quality.
General obligation bonds are issued by state and local municipalities and
are backed by the general taxing authorities of those issuers. Revenue bonds
are backed by the project's revenues, such as an electrical utility, airport
or educational establishment.
DURATION MANAGEMENT. The Fund can choose a shorter-than-average duration,
which means the portfolio is less sensitive to changes in interest rates.
Since bond prices fall when interest rates rise, a short duration is
typically advantageous in this environment.
YIELD-CURVE POSITIONING. A yield curve describes the relationship between a
bond's maturity and its yield. The Fund's performance can be impacted by
decisions to invest in bonds at varying maturities.
Q What is your outlook?
-------
A Despite the recent signs of modest inflation, we believe that municipal
bonds continue to offer investors an excellent tax-exempt return and we
expect strong demand for municipal bonds to continue. This would be
particularly true if the stock market continues the volatility experienced
in March and April.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY QUALITY RATING
Aaa 45%
Aa 35%
Not Rated 10%
A 6%
Baa 3%
Ba 1%
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
ALLEGHANY/CHICAGO TRUST
MUNICIPAL BOND FUND
GROWTH OF $10,000
LEHMAN BROTHERS ALLEGHANY/CHICAGO LIPPER INTERMEDIATE
FIVE-YEAR GENERAL TRUST MUNICIPAL MUNICIPAL
OBLIGATIONS BOND INDEX BOND FUND FUND INDEX
12-93 $10,000 $10,000 $10,000
04-94 9,782 9,803 9,810
10-94 9,838 9,808 9,808
04-95 10,288 10,218 10,316
10-95 10,855 10,719 10,880
04-96 11,025 10,811 10,987
10-96 11,368 11,103 11,369
04-97 11,548 11,201 11,564
10-97 12,107 11,673 12,155
04-98 12,339 11,871 12,419
10-98 12,897 12,393 12,983
04-99 13,144 12,561 13,162
10-99 13,040 12,173 12,823
04-00 13,191 12,445 13,045
THIS CHART COMPARES A $10,000 INVESTMENT MADE IN THE FUND ON ITS INCEPTION DATE
TO $10,000 INVESTMENTS MADE IN THE INDICES (LEHMAN BROTHERS FIVE-YEAR GENERAL
OBLIGATIONS BOND INDEX AND LIPPER INTERMEDIATE MUNICIPAL FUND INDEX) ON THAT
DATE. ALL DIVIDENDS AND CAPITAL GAINS ARE REINVESTED. FURTHER INFORMATION
RELATING TO THE FUND'S PERFORMANCE, INCLUDING EXPENSE REIMBURSEMENTS, IS
CONTAINED IN THE PROSPECTUS AND ELSEWHERE IN THIS REPORT. PAST PERFORMANCE IS
NOT INDICATIVE OF FUTURE PERFORMANCE. INDICES ARE UNMANAGED AND INVESTORS CANNOT
INVEST IN THEM.
15
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO MONEY MARKET FUND
PORTFOLIO MANAGER COMMENTARY APRIL 30, 2000
--------------------------------------------------------------------------------
[PHOTO OF FRED SENFT OMITTED]
Fred H. Senft, Jr., CFA
Q How did the Fund perform during
-------
the six month period ended April 30, 2000?
A Alleghany/Chicago Trust Money Market Fund produced a 7-day average yield of
5.65% and a 30-day average yield of 5.63%. In comparison, its benchmark, the
IBC Donoghue First Tier Index, yielded 5.39% and 5.38%, respectively. In
addition to yield, the Fund accomplished the all-important goals of
conservatism, safety and liquidity for money market fund investors.
Q What factors affected the Fund's
-------
performance?
A In November, January and March, the Fed raised short-term interest rates a
total of 0.75% in an effort to slow down the economy and prevent a
recurrence of inflation. The Fed might have raised rates further in 1999,
but it was concerned about the impact of lower liquidity on Y2K, which
turned out to be a non-event. Despite the Fed's efforts to slow the economy,
GDP rose at 7.3% during the fourth calendar quarter of 1999, followed by
5.4% during the first calendar quarter of 2000. These growth rates have
caused investors to worry about inflation. True, there is no concern that a
return to 1970s-style double-digit inflation is at all imminent. However,
the Consumer Price Index rose 0.4% in March, the largest monthly gain in
five years. By raising interest rates, the Fed makes it more costly to
borrow, reducing spending by businesses as well as consumers.
Q What was your strategy?
-------
A At opportune times during the period, we maintained a relatively short
maturity that enabled us to reinvest quickly, thus taking advantage of the
rising interest rate environment that existed. We also saw an opportunity to
move out of split-rated paper and into higher credit quality issues.
Split-rated securities can provide higher yields because they are rated
lower by one of the four national rating services. However, the minimal
additional yield offered by split-rated issues did not warrant taking on the
added risk. Corporate issuance continued to be strong, enabling us to have
better quality companies represented in the Fund. The consensus in the
marketplace was that corporate credit represented a low-risk investment in
light of a healthy economy. One of our favorite holdings in the portfolio is
Allstate Life Insurance Funding Agreement GIC (2.6% of net assets). During
the period, these funding agreements, which are based on the European credit
markets, outperformed Treasury securities and subsequently added additional
yield to the portfolio.
Q What is your outlook?
-------
A We believe that the Fed is likely to continue to raise interest rates in its
ongoing effort to curb the incredible growth in the economy. The performance
of commercial paper relies solely on short-term interest rates set by the
Fed. As that rate increases, so too does the yield generated from holding
commercial paper. We are going to extend our average maturity closer to our
benchmark, believing that market sentiment supports the idea of more rate
hikes and has already priced them into the market. Our emphasis on
high-quality issuers will likely continue to dominate in the second half of
2000 as we see the yield advantage on lower-quality securities diminishing
even further. We believe that money market funds currently provide an
attractive yield relative to inflation and we are confident that our
investment approach and strategy will benefit shareholders as the year
progresses.
[GRAPHIC OMITTED]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC:
PORTFOLIO ALLOCATION BY MARKET SECTOR
Commercial Paper 90%
Cash and Other Net Assets 7%
GIC Within Funding Agreement 3%
16
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL GROWTH FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 98.34%
ADVERTISING - 1.58%
1,228,300 Interpublic Group
of Companies, Inc. ........ $ 50,360,300
--------------
CONSUMER NON-DURABLES - 8.00%
1,500,000 Bestfoods .................... 75,375,000
3,700,000 Gillette Co. ................. 136,900,000
1,703,600 Newell Rubbermaid, Inc. ...... 42,909,425
--------------
255,184,425
--------------
ELECTRICAL - 2.63%
533,900 General Electric Co. ......... 83,955,775
--------------
FINANCE - 9.78%
428,500 American Express Co. ......... 64,301,781
875,000 American International
Group, Inc. ............... 95,976,562
1,115,400 Citigroup, Inc. .............. 66,296,587
2,087,800 Wells Fargo & Co. ............ 85,730,288
--------------
312,305,218
--------------
FOOD AND BEVERAGE - 6.24%
2,800,000 Coca-Cola Co. ................ 131,775,000
1,837,500 PepsiCo, Inc. ................ 67,413,281
--------------
199,188,281
--------------
HEALTH CARE SERVICES - 3.48%
1,344,800 Johnson & Johnson ............ 110,946,000
--------------
LODGING - 1.90%
1,900,000 Marriott International, Inc.,
Class A ................... 60,800,000
--------------
MEDICAL SUPPLIES - 6.21%
3,400,000 Boston Scientific Corp.* ..... 90,100,000
2,079,100 Medtronic, Inc. .............. 107,983,256
--------------
198,083,256
--------------
PHARMACEUTICALS - 12.26%
1,916,600 Bristol-Myers Squibb Co. ..... 100,501,713
4,800,200 Pfizer, Inc. ................. 202,208,425
2,200,000 Schering-Plough Corp. ........ 88,687,500
--------------
391,397,638
--------------
RESTAURANTS - 4.02%
3,363,100 McDonald's Corp. ............. 128,218,188
--------------
RETAIL - 11.73%
1,795,600 Circuit City Stores -
Circuit City Group ........ 105,603,725
1,327,000 Costco Wholesale Corp.* ...... 71,782,406
2,078,500 Gap, Inc. .................... 76,384,875
2,152,700 Home Depot, Inc. ............. 120,685,744
--------------
374,456,750
--------------
MARKET
SHARES VALUE
------- --------
TECHNOLOGY - 20.72%
1,635,100 Dell Computer Corp.* ......... $ 81,908,291
800,000 Electronic Arts, Inc.* ....... 48,325,000
1,880,700 Electronic Data Systems Corp. 129,298,125
1,048,100 Hewlett-Packard Co. .......... 141,493,500
612,800 Intel Corp. .................. 77,729,850
1,200,000 Microsoft Corp.* ............. 83,737,500
2,108,800 Solectron Corp.* ............. 98,718,200
--------------
661,210,466
--------------
TELECOMMUNICATIONS - 3.45%
2,419,250 MCI WorldCom, Inc.* .......... 110,000,273
--------------
TELECOMMUNICATIONS
EQUIPMENT - 6.34%
1,972,400 Lucent Technologies, Inc. .... 122,658,625
1,455,900 Tellabs, Inc.* ............... 79,847,016
--------------
202,505,641
--------------
TOTAL COMMON STOCKS .......... 3,138,612,211
--------------
(Cost $2,644,457,818)
INVESTMENT COMPANIES - 2.24%
71,632,592 Bankers Trust Institutional
Cash Management Fund ...... 71,632,592
1,244 Bankers Trust Institutional
Treasury Money Fund ....... 1,244
--------------
TOTAL INVESTMENT COMPANIES ... 71,633,836
--------------
(Cost $71,633,836)
TOTAL INVESTMENTS - 100.58% ................ 3,210,246,047
--------------
(Cost $2,716,091,654)**
LIABILITIES NET OF CASH AND
OTHER ASSETS - (0.58)% .................. (18,646,003)
--------------
NET ASSETS - 100.00% ....................... $3,191,600,044
==============
------------------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $2,716,091,654.
Gross unrealized appreciation .......... $ 683,505,234
Gross unrealized depreciation .......... (189,350,841)
--------------
Net unrealized appreciation ............ $ 494,154,393
==============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
17
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST GROWTH & INCOME FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 94.81%
ADVERTISING - 2.48%
154,737 Omnicom Group, Inc. .......... $ 14,090,738
--------------
CAPITAL GOODS - 2.18%
302,000 Pitney Bowes, Inc. ........... 12,344,250
--------------
CHEMICALS - 1.52%
194,527 Praxair, Inc. ................ 8,644,294
--------------
COMMERCIAL SERVICES - 2.37%
344,147 Ecolab, Inc. ................. 13,443,242
--------------
CONSUMER DURABLES - 7.47%
426,190 Harley-Davidson, Inc. ........ 16,967,689
198,948 Illinois Tool Works, Inc. .... 12,745,106
200,316 Johnson Controls, Inc. ....... 12,682,507
--------------
42,395,302
--------------
CONSUMER NON-DURABLES - 3.41%
334,233 Cintas Corp. ................. 13,233,538
102,842 Procter & Gamble Co. ......... 6,131,954
--------------
19,365,492
--------------
ELECTRICAL - 2.96%
106,813 General Electric Co. ......... 16,796,344
--------------
ENTERTAINMENT AND LEISURE - 1.10%
250,000 Carnival Corp. ............... 6,218,750
--------------
FINANCE - 12.09%
203,368 AFLAC, Inc. .................. 9,926,900
139,221 American International
Group, Inc. ............... 15,270,803
235,200 Associates First Capital Corp.,
Class A ................... 5,218,500
245,811 Federal Home Loan
Mortgage Corp. ............ 11,291,943
100,000 Marsh & McLennan Cos., Inc. .. 9,856,250
272,276 MBNA Corp. ................... 7,232,331
221,054 Schwab (Charles) Corp. ....... 9,836,903
--------------
68,633,630
--------------
FOOD AND BEVERAGE - 3.39%
511,073 Sysco Corp. .................. 19,229,121
--------------
HEALTH CARE SERVICES - 2.43%
249,895 Cardinal Health, Inc. ........ 13,759,843
--------------
MEDICAL SUPPLIES - 2.60%
474,242 Sybron International Corp.* .. 14,760,782
--------------
OIL AND GAS EXTRACTION - 2.76%
182,601 Schlumberger, Ltd. ........... 13,980,389
35,351 Transocean Sedco Forex, Inc. . 1,661,497
--------------
15,641,886
--------------
MARKET
SHARES VALUE
------- --------
PHARMACEUTICALS - 3.05%
98,502 Merck & Co., Inc. ............ $ 6,845,889
248,287 Pfizer, Inc. ................. 10,459,090
--------------
17,304,979
--------------
RETAIL - 4.08%
229,896 Kohl's Corp.* ................ 11,035,008
431,495 Walgreen Co. ................. 12,135,797
--------------
23,170,805
--------------
TECHNOLOGY - 30.34%
371,206 Cisco Systems, Inc.* ......... 25,752,416
305,053 Computer Associates
International, Inc. ....... 17,025,771
163,580 Computer Sciences Corp.* ..... 13,341,994
250,000 Dell Computer Corp.* ......... 12,523,438
270,000 Electronic Data Systems Corp. 18,562,500
200,000 EMC Corp.* ................... 27,787,500
234,594 Microsoft Corp.* ............. 16,370,263
353,686 Solectron Corp.* ............. 16,556,926
263,568 Sun Microsystems, Inc.* ...... 24,240,020
--------------
172,160,828
--------------
TELECOMMUNICATIONS
EQUIPMENT - 7.01%
420,000 Nokia Corp., SP ADR .......... 23,887,500
290,021 Tellabs, Inc.* ............... 15,905,839
--------------
39,793,339
--------------
UTILITY - 3.57%
225,443 AES Corp.* ................... 20,275,780
--------------
TOTAL COMMON STOCKS .......... 538,029,405
--------------
(Cost $312,172,810)
PAR VALUE
-----------
REPURCHASE AGREEMENT - 5.16%
$29,294,000 Bank One 5.850%, dated 04/28/00
to be repurchased on 05/01/00
at $29,308,281 (Collateralized
by U.S. Government Agency
Obligations with interest rates
from 6.020% to 8.000% and
maturities from 05/01/02 to
08/25/14; Total Par $30,125,000) 29,294,000
--------------
TOTAL REPURCHASE AGREEMENT ... 29,294,000
--------------
(Cost $29,294,000)
TOTAL INVESTMENTS - 99.97% ................. 567,323,405
--------------
(Cost $341,466,810)**
NET OTHER ASSETS AND LIABILITIES - 0.03% ... 188,763
--------------
NET ASSETS - 100.00% ....................... $ 567,512,168
==============
--------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $341,466,810.
Gross unrealized appreciation ..... $ 241,854,320
Gross unrealized depreciation ..... (15,997,725)
--------------
Net unrealized appreciation ....... $ 225,856,595
==============
SPADR Sponsored American Depositary Receipt
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
18
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST TALON FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 98.74%
ADVERTISING - 3.28%
15,000 True North Communications, Inc. $ 617,812
--------------
AUTOMOTIVE - 5.71%
23,000 Magna International, Inc.,
Class A ................... 1,075,250
--------------
BUILDING AND CONSTRUCTION - 1.87%
50,000 Champion Enterprises, Inc.* .. 353,125
--------------
BUSINESS SERVICES - 14.02%
27,000 ACNielsen Corp.* ............. 622,687
17,000 Manpower, Inc. ............... 600,312
31,000 Unisys Corp. * ............... 718,813
64,000 Wallace Computer Services, Inc. 700,000
--------------
2,641,812
--------------
CHEMICALS - 2.34%
15,000 Sigma-Aldrich Corp. .......... 440,156
--------------
CONSUMER DURABLES - 2.93%
28,000 Ingram Micro, Inc., Class A* . 551,250
--------------
CONSUMER NON-DURABLES - 4.88%
75,000 Mattel, Inc. ................. 918,750
--------------
ELECTRICAL - 1.31%
8,000 Thomas & Betts Corp. ......... 246,500
--------------
ELECTRONICS - 2.89%
32,700 Sensormatic Electronics Corp.* 545,681
--------------
ENTERTAINMENT AND LEISURE - 2.59%
4,600 Magna Entertainment Corp.,
Class A* .................. 19,119
23,000 Mirage Resorts, Inc.* ........ 468,625
--------------
487,744
--------------
FOOD AND BEVERAGE - 1.95%
15,000 Dean Foods Co. ............... 367,500
--------------
HEALTH CARE SERVICES - 2.17%
24,000 IMS Health, Inc. ............. 409,500
--------------
PHARMACEUTICALS - 5.07%
10,000 ALZA Corp.* .................. 440,625
12,000 Elan Corp. plc, SP ADR* ...... 514,500
--------------
955,125
--------------
PRINTING AND PUBLISHING - 5.63%
18,200 Houghton Mifflin Co. ......... 756,438
6,500 Scholastic Corp.* ............ 304,281
--------------
1,060,719
--------------
MARKET
SHARES VALUE
------- --------
RETAIL - 6.16%
35,000 Borders Group, Inc.* ......... $ 555,625
53,000 Saks, Inc.* .................. 606,188
--------------
1,161,813
--------------
TECHNOLOGY - 13.15%
15,000 American Power Conversion Corp.* 529,219
14,000 Diebold, Inc. ................ 404,250
14,000 Legato Systems, Inc.* ........ 181,562
62,500 Mentor Graphics Corp.* ....... 818,359
13,000 Tech Data Corp.* ............. 543,969
--------------
2,477,359
--------------
TELECOMMUNICATIONS
EQUIPMENT - 14.77%
34,500 Andrew Corp.* ................ 1,018,828
18,000 Harris Corp. ................. 581,625
33,000 Newbridge Networks Corp.* .... 1,181,813
--------------
2,782,266
--------------
TRANSPORTATION - 8.02%
37,000 CNF Transportation, Inc. ..... 1,033,688
22,000 Southwest Airlines Co. ....... 477,125
--------------
1,510,813
--------------
TOTAL COMMON STOCKS .......... 18,603,175
--------------
(Cost $15,951,236)
INVESTMENT COMPANY - 1.31%
247,286 Bankers Trust Institutional
Cash Management Fund ...... 247,286
--------------
TOTAL INVESTMENT COMPANY ..... 247,286
--------------
(Cost $247,286)
TOTAL INVESTMENTS - 100.05% ................ 18,850,461
--------------
(Cost $16,198,522)**
LIABILITIES NET OF CASH AND
OTHER ASSETS - (0.05)% ................. (9,636)
--------------
NET ASSETS - 100.00% ....................... $ 18,840,825
==============
------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is
$16,198,522.
Gross unrealized appreciation .......... $ 3,910,516
Gross unrealized depreciation .......... (1,258,577)
--------------
Net unrealized appreciation ............ $ 2,651,939
==============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
19
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 94.03%
AEROSPACE AND DEFENSE - 1.23%
39,600 AAR Corp. .................... $ 596,475
--------------
BANKS - 21.64%
40,100 CCB Financial Corp. .......... 1,586,456
37,600 Century South Banks, Inc. .... 810,750
26,100 City National Corp. .......... 960,806
62,800 Cullen/Frost Bankers, Inc. ... 1,550,375
42,800 Eldorado Bancshares, Inc.* ... 308,963
85,400 Fidelity National Corp. ...... 592,463
106,310 First Charter Corp. .......... 1,471,729
31,700 National City Bancorp ........ 459,650
79,800 Prosperity Bancshares, Inc. .. 1,127,175
153,500 Republic Security Financial Corp. 868,234
15,700 Wilmington Trust Corp. ....... 724,163
--------------
10,460,764
--------------
BASIC MATERIALS - 3.61%
71,800 Century Aluminum Co. ......... 998,469
35,200 Pope & Talbot, Inc. .......... 745,800
--------------
1,744,269
--------------
BUILDING AND CONSTRUCTION - 4.58%
25,800 Florida Rock Industries, Inc. 835,275
17,300 Kaufman & Broad Home Corp. ... 333,025
113,800 Morrison Knudsen Corp.* ...... 1,045,537
--------------
2,213,837
--------------
BUSINESS SERVICES - 3.29%
41,800 ChoicePoint, Inc.* ........... 1,588,400
--------------
CHEMICALS - 5.86%
53,600 Cytec Industries, Inc.* ...... 1,614,700
31,700 Fuller (H.B.) Co. ............ 1,216,487
--------------
2,831,187
--------------
CONSUMER DURABLES - 1.73%
12,800 Harman International
Industries, Inc. .......... 836,800
--------------
CONSUMER NON-DURABLES - 1.57%
32,200 Alberto-Culver Co., Class B .. 760,725
--------------
DIVERSIFIED FINANCIAL
SERVICES - 3.43%
92,100 United Asset Management Co. .. 1,657,800
--------------
HEALTH CARE SERVICES - 1.99%
17,600 Universal Health Services,
Class B* .................. 963,600
--------------
INDUSTRIAL - 5.21%
20,000 Astec Industries, Inc.* ...... 501,875
51,500 Gardner Denver, Inc.* ........ 898,031
61,400 Milacron, Inc. ............... 1,120,550
--------------
2,520,456
--------------
INSURANCE - 5.11%
27,800 Gallagher (Arthur J.) & Co. .. 1,035,550
98,400 Horace Mann Educators Corp. .. 1,432,950
--------------
2,468,500
--------------
MARKET
SHARES VALUE
------- --------
OIL AND GAS EXTRACTION - 9.99%
51,400 Pogo Producing Co. ........... $ 1,317,125
150,800 Santa Fe Snyder Corp.* ....... 1,385,475
89,000 Tesoro Petroleum Corp.* ...... 1,045,750
62,300 Tuboscope, Inc.* ............. 1,082,462
--------------
4,830,812
--------------
PHARMACEUTICALS - 4.92%
45,000 Carter-Wallace, Inc. ......... 1,001,250
81,100 ChiRex, Inc.* ................ 1,376,166
--------------
2,377,416
--------------
PRINTING AND PUBLISHING - 5.88%
31,900 Houghton Mifflin Co. ......... 1,325,844
54,500 Meredith Corp. ............... 1,515,781
--------------
2,841,625
--------------
REAL ESTATE INVESTMENT TRUST
(REIT) - 5.39%
41,200 CBL & Associates Properties, Inc. 965,625
24,300 Cousins Properties, Inc. ..... 953,775
26,700 SL Green Realty Corp. ........ 685,856
--------------
2,605,256
--------------
SAVINGS AND LOANS - 5.23%
94,300 Commercial Federal Corp. ..... 1,467,544
77,700 First Financial Holdings, Inc. 1,063,519
--------------
2,531,063
--------------
TRANSPORTATION - 3.37%
30,300 American Freightways Corp.* .. 561,497
23,000 USFreightways Corp. .......... 1,066,625
--------------
1,628,122
--------------
TOTAL COMMON STOCKS .......... 45,457,107
--------------
(Cost $46,841,393)
PAR VALUE
-----------
REPURCHASE AGREEMENT - 3.87%
$ 1,870,000 Bank One 5.850%, dated 04/28/00
to be repurchased on 05/01/00
at $1,870,912 (Collateralized
by U.S. Government Agency
Obligation 5.730% due on
12/10/01; Total Par
$1,905,000) ............... 1,870,000
--------------
TOTAL REPURCHASE AGREEMENT ... 1,870,000
--------------
(Cost $1,870,000)
TOTAL INVESTMENTS - 97.90% ................. 47,327,107
--------------
(Cost $48,711,393)**
NET OTHER ASSETS AND LIABILITIES - 2.10% ... 1,012,795
--------------
NET ASSETS - 100.00% ....................... $ 48,339,902
==============
------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $48,711,393.
Gross unrealized appreciation .......... $ 3,102,417
Gross unrealized depreciation .......... (4,486,703)
--------------
Net unrealized depreciation ............ $ (1,384,286)
==============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
20
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 90.02%
AIRLINES - 2.01%
491,600 AirTran Holdings, Inc.* ...... $ 2,104,662
80,100 Frontier Airlines, Inc.* ..... 1,219,022
--------------
3,323,684
--------------
AUTO MANUFACTURERS - 1.84%
86,600 Navistar International Corp.* 3,031,000
--------------
BIOTECHNOLOGY - 2.34%
27,300 Aphton Corp.* ................ 749,044
58,500 ArQule, Inc.* ................ 689,203
42,900 Digene Corp.* ................ 1,820,569
52,600 Organogenesis, Inc.* ......... 601,612
--------------
3,860,428
--------------
COMMUNICATION SERVICES - 1.07%
87,100 Insight Communications Co., Inc.* 1,771,941
--------------
COMPUTER SOFTWARE - 7.54%
239,600 FileNET Corp.* ............... 6,978,350
52,400 Hyperion Solutions Corp.* .... 1,586,737
60,100 Industri-Matematik
International Corp.* ...... 412,248
16,400 Lifeminders.com, Inc.* ....... 726,725
30,500 OTG Software, Inc.* .......... 665,281
27,700 SportLine.com, Inc.* ......... 530,628
254,200 3DO Company (The)* ........... 1,549,031
--------------
12,449,000
--------------
ELECTRONICS - 6.68%
51,500 California Amplifier, Inc.* .. 1,403,375
14,400 Newport Corp. ................ 1,762,650
78,400 Planar Systems, Inc.* ........ 857,500
71,000 Trimble Navigation Ltd.* ..... 1,959,156
137,500 Varian, Inc.* ................ 5,040,234
--------------
11,022,915
--------------
FINANCE - 1.21%
188,100 Wit Capital Group, Inc.* ..... 1,998,562
--------------
HEALTHCARE SERVICES - 2.62%
226,900 Oxford Health Plans, Inc.* ... 4,318,191
--------------
INDUSTRIAL - 4.07%
46,400 Helix Technology Corp. ....... 2,367,850
47,000 Maverick Tube Corp.* ......... 1,346,844
150,600 Semitool, Inc.* .............. 3,007,294
--------------
6,721,988
--------------
MEDICAL SUPPLIES - 3.20%
178,100 Isolyser Co., Inc.* .......... 829,278
108,800 Novoste Corp.* ............... 4,457,400
--------------
5,286,678
--------------
MARKET
SHARES VALUE
------- --------
MEDICAL TECHNOLOGIES - 5.22%
76,300 Acuson Corp.* ................ $ 939,444
34,000 Aspect Medical Systems, Inc.* 1,506,625
98,900 Cytyc Corp.* ................. 4,444,319
62,600 Laboratory Corp.of America
Holdings* ................. 371,687
259,400 LaserSight, Inc.* ............ 1,349,691
--------------
8,611,766
--------------
OIL AND GAS EXTRACTION - 10.37%
41,000 Dril-Quip, Inc. * ............ 1,665,625
75,200 Kinder Morgan, Inc. .......... 2,279,500
182,300 Marine Drilling Cos., Inc.* .. 4,739,800
10,300 National-Oilwell, Inc.* ...... 246,556
244,900 R & B Falcon Corp.* .......... 5,081,675
110,800 Rowan Cos., Inc.* ............ 3,095,475
--------------
17,108,631
--------------
PHARMACEUTICALS - 2.19%
28,000 Cephalon, Inc.* .............. 1,571,500
14,000 Coulter Pharmaceutical, Inc.* 255,062
88,400 Dura Pharmaceuticals, Inc.* .. 1,146,438
10,700 ILEX Oncology, Inc.* ......... 254,125
14,000 SangStat Medical Corp.* ...... 396,813
--------------
3,623,938
--------------
RESTAURANTS - 2.27%
136,700 Lone Star Steakhouse & Saloon, Inc. 1,610,497
61,100 P.F. Chang's China Bistro, Inc.* 2,136,591
--------------
3,747,088
--------------
RETAIL - 10.77%
48,900 American Eagle Outfitters, Inc.* 832,828
78,900 Ames Department Stores, Inc.* 1,420,200
35,700 Braun's Fashions Corp.* ...... 809,944
75,200 Charlotte Russe Holding, Inc.* 822,500
420,700 Charming Shoppes, Inc.* ...... 2,839,725
109,175 Cutter & Buck, Inc.* ......... 1,327,159
73,200 Dress Barn (The), Inc.* ...... 1,427,400
327,900 Genesco, Inc.* ............... 4,242,206
54,600 Men's Wearhouse (The), Inc.* . 1,167,075
21,600 Michaels Stores, Inc.* ....... 855,900
59,400 Pacific Sunwear of California, Inc.* 2,025,169
--------------
17,770,106
--------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
21
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
SEMICONDUCTORS - 18.62%
125,530 Alliance Semiconductor Corp.* $ 2,549,828
153,600 Electroglas, Inc.* ........... 5,947,200
194,300 MEMC Electronic Materials, Inc.* 3,375,962
59,400 Rudolph Technologies, Inc.* .. 1,806,131
197,500 Varian Semiconductor
Equipment Associates, Inc.* 13,288,047
210,800 Xicor, Inc. * ................ 3,761,462
--------------
30,728,630
--------------
TECHNOLOGY - 1.53%
12,900 JDS Uniphase Corp.* .......... 1,337,972
84,600 S3, Inc.* .................... 1,187,044
--------------
2,525,016
--------------
TELECOMMUNICATIONS
EQUIPMENT - 6.47%
125,300 Glenayre Technologies, Inc.* . 1,648,478
104,400 Motient Corp.* ............... 1,301,738
129,100 TEKELEC* ..................... 4,498,328
49,400 Telaxis Communications Corp.* 1,298,294
12,950 Terayon Communication
Systems, Inc.* ............ 1,203,945
15,400 Tut Systems, Inc.* ........... 734,388
--------------
10,685,171
--------------
TOTAL COMMON STOCKS .......... 148,584,733
--------------
(Cost $144,711,520)
PAR VALUE
-----------
REPURCHASE AGREEMENT - 12.85%
$21,206,256 Morgan Stanley, Bank of New York
Tri-Party 5.850%, dated
04/28/00 to be repurchased
on 05/01/00 at $21,216,594
(Collateralized by U.S.
Treasury Note 5.500% due on
05/01/00; Total Par
$21,549,274) .............. 21,206,256
--------------
TOTAL REPURCHASE AGREEMENT ... 21,206,256
--------------
(Cost $21,206,256)
TOTAL INVESTMENTS - 102.87% ................ 169,790,989
--------------
(Cost $165,917,776)**
LIABILITIES NET OF CASH
AND OTHER ASSETS - (2.87)% ............... (4,742,191)
--------------
NET ASSETS - 100.00% ....................... $ 165,048,798
==============
--------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $165,917,776.
Gross unrealized appreciation .......... $ 23,503,378
Gross unrealized depreciation .......... (19,630,165)
--------------
Net unrealized appreciation ............ $ 3,873,213
==============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
22
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 94.29%
AUSTRALIA - 3.68%
33,056 Amcor Ltd. ................... $ 97,875
36,141 Broken Hill Proprietary Co. Ltd. 389,201
54,100 Foster's Brewing Group Ltd. .. 136,677
41,024 Leighton Holdings Ltd. ....... 108,530
29,700 National Australia Bank Ltd. . 406,909
18,792 News Corp. Ltd. .............. 238,652
11,018 Paperlinx Ltd. ............... 19,850
12,600 Rio Tinto Ltd. ............... 187,176
59,500 Southcorp Ltd ................ 185,589
21,887 TABCORP Holdings Ltd. ........ 117,160
62,700 Telstra Corp. Ltd. ........... 268,767
42,509 Westpac Banking Corp. ........ 271,340
--------------
2,427,726
--------------
FINLAND - 4.94%
2,900 JOT Automation Group Oyj ..... 20,959
6,882 Kemira Oyj ................... 33,472
42,624 Nokia Oyj .................... 2,445,092
1,928 Okobank, Class A ............. 17,878
2,030 Oy Hartwall AB ............... 29,767
6,398 Rautaruukki Oyj .............. 32,572
2,020 Sanoma WSOY Oyj, Class B ..... 129,465
5,300 Sonera Group Oyj ............. 291,503
3,400 Talentum ..................... 55,730
4,272 UPM-Kymmene Oyj .............. 110,685
729 Viking Line Oyj .............. 19,551
7,250 YIT-Yhtyma Oyj ............... 71,248
--------------
3,257,922
--------------
FRANCE - 9.80%
2,460 Alcatel ...................... 570,278
3,310 Axa .......................... 490,788
5,130 Banque Nationale de Paris .... 414,601
1,780 Cap Gemini SA ................ 349,531
4,194 Carrefour SA ................. 272,994
1,130 Castorama Dubois
Investissement SA ......... 246,548
410 Danone ....................... 89,642
6,536 France Telecom SA ............ 1,011,308
1,540 Groupe GTM ................... 118,301
1,630 Hermes International ......... 231,166
280 L'OREAL ...................... 189,893
2,436 Lafarge SA ................... 201,747
1,200 Legrand ...................... 223,639
2,740 Renault SA ................... 124,547
1,800 Schneider Electric SA ........ 117,819
1,170 Sodexho Alliance ............. 175,289
1,430 Suez Lyonnaise des Eaux SA ... 224,252
5,198 Total Fina SA, Class B* ...... 788,686
6,221 Vivendi ...................... 615,320
2,800 Vivendi, Warrants
expiring 05/02/01* ........ 11,989
--------------
6,468,338
--------------
MARKET
SHARES VALUE
------- --------
GERMANY - 11.01%
3,127 Allianz AG ................... $ 1,174,058
7,084 BASF AG ...................... 309,445
9,711 Bayer AG ..................... 394,182
9,100 Bayerische Motoren Werke
(BMW) AG .................. 241,980
6,600 Commerzbank AG ............... 249,602
10,784 DaimlerChrysler AG ........... 631,360
23,520 Deutsche Telekom AG .......... 1,535,230
10,253 Dresdner Bank AG ............. 418,513
5,030 HypoVereinsbank .............. 312,778
8,600 MAN AG ....................... 279,112
3,060 Metro AG ..................... 114,612
1,580 Muenchener Rueckversicherungs-
Gesellschaft AG ........... 458,923
4,566 Siemens AG ................... 673,699
7,210 Veba AG ...................... 350,672
6,160 Viag AG ...................... 118,721
--------------
7,262,887
--------------
IRELAND - 2.64%
44,700 Allied Irish Banks Plc ....... 446,192
7,100 Bank of Ireland .............. 47,893
22,800 CRH Plc ...................... 364,804
111,900 eircom Plc ................... 394,197
16,559 Irish Life & Permanent Plc ... 136,989
15,300 Kerry Group Plc, Class A ..... 194,034
71,500 Smurfit (Jefferson) Group Plc 156,002
--------------
1,740,111
--------------
ITALY - 2.29%
6,737 Assicurazioni Generali ....... 191,700
18,938 Banca Intesa SpA ............. 69,727
12,200 Banca Popolare di Milano ..... 72,757
31,060 Benetton Group SpA* .......... 57,179
8,000 Enel SpA* .................... 33,891
48,535 ENI SpA ...................... 241,354
3,935 Fiat SpA ..................... 96,480
28,984 Montedison SpA ............... 29,775
9,010 San Paolo-IMI SpA ............ 126,141
35,510 Telecom Italia Mobile SpA .... 338,962
18,080 Telecom Italia SpA ........... 252,794
--------------
1,510,760
--------------
JAPAN - 29.73%
106,000 Asahi Chemical Industry Co., Ltd. 610,453
68,000 Bank of Tokyo-Mitsubishi, Ltd. 877,663
21,000 Bridgestone Corp. ............ 455,951
17,000 Canon, Inc. .................. 777,557
29,000 Dai Nippon Printing Co., Ltd. 492,172
10,700 Fanuc, Ltd. .................. 1,121,467
16,000 Fuji Photo Film .............. 641,452
20,000 Fujisawa Pharmaceutical Co., Ltd. 749,965
32,000 Hitachi, Ltd. ................ 382,205
14,000 Honda Motor Co., Ltd. ........ 626,082
6,000 Ito-Yokado Co., Ltd. ......... 438,313
50,000 Kirin Brewery Co., Ltd. ...... 651,359
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
23
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
JAPAN (CONTINUED)
29,000 Matsushita Electric Industrial
Co., Ltd. ................. $ 767,927
37,000 Mitsubishi Corp. ............. 322,022
52,000 Mitsubishi Estate Co., Ltd. .. 584,973
119,000 Mitsubishi Heavy Industries, Ltd. 370,205
6,000 Murata Manufacturing Co., Ltd. 1,158,280
27,000 NEC Corp. .................... 734,966
213,000 Nippon Steel Corp. ........... 479,228
112 Nippon Telegraph &
Telephone Corp. ........... 1,389,565
52,000 Nissan Motor Co., Ltd. ....... 236,396
19,000 Nomura Securities Co., Ltd. .. 478,496
9,000 Secom CO., LTD. .............. 754,965
38,000 Sharp Corp. .................. 733,577
4,600 SONY Corp. ................... 528,550
4,600 SONY Corp. (New)* ............ 532,383
38,000 Sumitomo Bank, Ltd. .......... 475,330
40,000 Tokio Marine & Fire
Insurance Co., Ltd. ....... 390,352
21,800 Tokyo Electric Power Co. ..... 514,698
27,000 Toyota Motor Corp. ........... 1,342,438
--------------
19,618,990
--------------
NETHERLANDS - 4.00%
7,699 ABN AMRO Holding NV .......... 158,531
3,500 AEGON NV ..................... 251,525
2,114 Akzo Nobel NV ................ 86,540
4,108 Fortis (NL) NV ............... 103,299
2,050 Heineken NV .................. 113,683
4,911 ING Groep NV ................. 267,965
2,600 Koninklijke Ahold NV ......... 60,628
7,056 Koninklijke (Royal) Philips
Electronics NV ............ 314,765
2,561 KPN NV ....................... 258,082
13,257 Royal Dutch Petroleum Co. .... 764,093
3,247 Unilever NV .................. 147,474
2,059 VNU NV ....................... 110,158
--------------
2,636,743
--------------
NEW ZEALAND - 1.25%
419,700 Brierley Investments Ltd. .... 77,446
109,400 Carter Holt Harvey Ltd. ...... 92,437
15,700 Fisher & Paykel Industries Ltd. 46,506
39,200 Fletcher Challenge Energy .... 90,419
44,200 Lion Nathan Ltd. ............. 89,288
101,300 Telecom Corp. of New Zealand Ltd. 427,964
--------------
824,060
--------------
NORWAY - 2.86%
45,820 Christiana Bank Og Kreditkasse 211,867
60,520 DNB Holding ASA .............. 212,244
16,800 Hafslund ASA, Class B ........ 47,097
2,920 Merkantildata ASA* ........... 20,057
17,790 Norsk Hydro ASA .............. 650,720
3,340 Norske Skogindustrier ASA .... 89,529
16,730 Orkla ASA, Class B ........... 258,793
MARKET
SHARES VALUE
------- --------
NORWAY (CONTINUED)
5,610 Petroleum Geo-Services* ...... $ 87,720
21,100 Storebrand ASA ............... 131,971
5,990 Tandberg Television ASA * .... 54,190
5,840 Tomra Systems ASA ............ 120,668
--------------
1,884,856
--------------
SINGAPORE - 1.16%
24,000 City Developments, Ltd. ...... 108,995
11,000 DBS Group Holdings Ltd. ...... 151,480
53,000 DBS Land Ltd. ................ 75,160
25,000 Overseas Union Bank Ltd. ..... 114,269
10,000 Singapore Press Holdings Ltd. 195,722
86,000 Singapore Technologies
Engineering Ltd. .......... 120,949
--------------
766,575
--------------
SPAIN - 5.03%
7,700 Autopistas, Concesionaria
Espanola SA ............... 67,901
45,500 Banco Bilbao Vizcaya
Argentaria SA ............. 620,461
42,600 Banco Santander Central
Hispano SA ................ 444,206
19,100 Endesa SA .................... 414,300
6,800 Fomento de Construcciones y
Contratas SA .............. 139,401
3,200 Gas Natural SDG SA ........... 53,470
11,700 Iberdrola SA ................. 150,081
13,200 Repsol-YPF SA ................ 270,003
2,000 Sogecable SA* ................ 84,637
46,000 Telefonica SA ................ 1,023,719
2,500 Union Electrica Fenosa SA .... 47,887
--------------
3,316,066
--------------
SWITZERLAND - 5.56%
2,015 ABB AG ....................... 225,939
2,601 Credit Suisse Group .......... 469,497
97 Holderbank Financiere
Glarus AG ................. 109,608
275 Nestle SA .................... 484,441
525 Novartis AG .................. 732,877
71 Roche Holding AG ............. 740,980
62 Schindler Holding AG ......... 88,561
520 Swisscom AG .................. 183,207
1,745 UBS AG ....................... 427,225
490 Zurich Allied AG ............. 208,130
--------------
3,670,465
--------------
UNITED KINGDOM - 10.34%
5,822 Abbey National Plc ........... 66,441
6,900 Allied Zurich Plc ............ 68,645
7,396 AstraZeneca Group Plc ........ 309,864
7,000 Barclays Plc ................. 179,713
14,055 BG Group Plc ................. 84,903
5,060 Boots Co. Plc ................ 38,779
87,206 BP Amoco Plc ................. 752,850
11,932 British Aerospace Plc ........ 73,983
9,000 British American Tobacco Plc . 57,134
8,200 British Sky Broadcasting Group Plc 200,946
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
24
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
UNITED KINGDOM (CONTINUED)
27,300 British Telecommunications Plc $ 487,514
7,800 Cadbury Schweppes Plc ........ 53,008
13,600 Centrica Plc ................. 49,759
5,134 CGU Plc ...................... 73,577
16,000 Diageo Plc ................... 129,160
3,600 GKN Plc ...................... 49,771
15,815 Glaxo Wellcome Plc ........... 489,000
8,900 Granada Group plc ............ 87,226
8,700 Halifax Group Plc ............ 81,609
6,100 Hays Plc ..................... 42,167
35,416 HSBC Holdings Plc ............ 392,867
14,500 Invensys Plc ................. 69,813
5,300 Kingfisher Plc ............... 43,651
28,700 Legal & General Group Plc .... 74,956
24,420 Lloyds TSB Group Plc ......... 238,382
12,600 Marconi Plc .................. 157,132
10,900 Marks & Spencer Plc .......... 40,007
5,500 National Grid Group Plc ...... 45,384
2,800 Pearson Plc .................. 95,643
8,331 Prudential Plc ............... 128,992
1,900 Railtrack Group Plc .......... 24,301
6,800 Reuters Group Plc ............ 120,797
4,700 Rio Tinto Plc ................ 72,991
4,800 Royal Bank of Scotland Group Plc 74,769
8,200 Sainsbury (J) Plc ............ 42,768
7,158 ScottishPower Plc ............ 57,532
25,252 SmithKline Beecham Plc ....... 345,774
30,845 Tesco Plc .................... 104,929
11,007 Unilever Plc ................. 65,805
273,520 Vodafone AirTouch Plc ........ 1,249,850
--------------
6,822,392
--------------
TOTAL COMMON STOCKS .......... 62,207,891
--------------
(Cost $56,205,781)
FOREIGN INDEX SECURITY - 2.45%
3,910 Sweden OPAL .................. 1,617,215
--------------
TOTAL FOREIGN INDEX SECURITY . 1,617,215
--------------
(Cost $873,439)
MARKET
SHARES VALUE
------- --------
PREFERRED STOCKS - 0.93%
GERMANY - 0.92%
1,035 SAP AG ....................... $ 608,774
--------------
UNITED KINGDOM - 0.01%
2,695 British Aerospace Plc ........ 4,133
--------------
TOTAL PREFERRED STOCKS ....... 612,907
--------------
(Cost $480,041)
PAR VALUE
-----------
FOREIGN NOTES AND BONDS - 0.02%
UNITED KINGDOM - 0.02%
BG Transco Holdings Plc
$ 3,000 7.057%, 12/14/09 ............. 4,702
3,000 4.188%, 12/14/22 ............. 4,554
3,000 7.000%, 12/16/24 ............. 4,621
--------------
TOTAL FOREIGN NOTES AND BONDS 13,877
--------------
(Cost $14,640)
TOTAL INVESTMENTS - 97.69% ................. 64,451,890
--------------
(Cost $57,573,901)**
NET OTHER ASSETS AND LIABILITIES - 2.31% ... 1,526,743
--------------
NET ASSETS - 100.00% ....................... $ 65,978,633
==============
------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $57,573,901.
Gross unrealized appreciation $ 11,892,225
Gross unrealized depreciation (5,014,236)
--------------
Net unrealized appreciation $ 6,877,989
==============
OPAL Optimised Portfolios As Listed Security
As of April 30, 2000, the Fund has entered into the following forward foreign
currency contracts:
FORWARD FOREIGN CURRENCY CONTRACTS SOLD:
<TABLE>
<CAPTION>
CURRENCY SETTLEMENT CONTRACTS AT IN EXCHANGE UNREALIZED
VALUE CONTRACTS TO DELIVER DATES VALUE FOR U.S. $ DEPRECIATION
------ -------------------- ------ ----- ---------- ---------------
<S> <C> <C> <C> <C> <C>
739,188 EU 05/02/2000 $672,101 $670,961 $(1,140)
======== ======== ========
</TABLE>
------------------
EU European Monetary Unit
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
25
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 82.61%
ARGENTINA - 2.13%
9,697 Banco de Galicia y Buenos Aires,
Class B ................... $ 42,114
4,820 Banco Frances SA ............. 32,316
737 IRSA Inversiones y
Representaciones SA, SP GDR 21,834
3,876 Molinos Rio de la Plata SA* .. 8,611
3,320 PC Holdings SA, SP ADR* ...... 50,837
11,160 Renault Argentina SA ......... 9,716
23,816 Siderca SA ................... 50,525
3,501 Telefonica de Argentina SA,
SP ADR .................... 122,973
19,900 Transportadora de Gas del
Sur SA, Class B ........... 32,459
--------------
371,385
--------------
BRAZIL - 1.43%
547,900 Companhia Paulista de Forca e Luz 18,208
3,322,000 Companhia Siderurgica Nacional 93,818
7,500 Souza Cruz SA ................ 45,694
1,238 Tele Nordeste Celular
Participacoes SA, Rights* . --
589 Tele Norte Leste Participacoes SA,
ADR ....................... 10,491
934,000 Telecomunicacoes Brasileiras SA,
Class A ................... 80,183
1,696 Telemig Celular Participacoes SA,
Rights* ................... --
109 Telesp Celular Participacoes SA --
--------------
248,394
--------------
CHILE - 3.84%
4,400 Banco Santander Chile, SP ADR* 65,175
7,651 Cia. Telecomunicaciones de Chile
SA, SP ADR ................ 141,543
2,000 Compania Cervecerias Unidas SA,
SP ADR .................... 44,625
2,500 Distribucion y Servicio D&S SA,
ADR ....................... 42,500
3,700 Embotelladora Andina SA,
ADR, Series A ............. 43,013
7,172 Empresa Nacional de
Electricidad SA, SP ADR ... 82,478
5,502 Enersis SA, SP ADR ........... 102,475
4,928 Gener SA, SP ADR ............. 67,452
2,047 Madeco SA, SP ADR ............ 18,423
1,790 Maderas y Sinteticos SA, SP ADR 24,612
1,430 Sociedad Quimica y Minera
de Chile SA, SP ADR, Class A 35,393
--------------
667,689
--------------
MARKET
SHARES VALUE
------- --------
CHINA - 3.23%
492,000 Beijing Datang Power Generation
Co. Ltd., Class H ......... $ 68,218
166,000 China Southern Airlines Co. Ltd.,
Class H* .................. 30,476
128,000 Guangdong Kelon Electrical
Holdings Co. Ltd., Class H 79,700
322,000 Guangshen Railway Co. Ltd.,
Class H ................... 38,859
346,000 Huaneng Power
International, Inc., Class H 79,068
338,000 Jiangsu Express Co. Ltd.,
Class H ................... 38,186
188,000 Qingling Motors Co. Ltd., Class H 24,860
632,000 Shanghai Petrochemical Co.
Ltd., Class H ............. 85,195
222,000 Shenzhen Expressway Co. Ltd.,
Class H ................... 24,796
266,000 Yizheng Chemical Fibre Co. Ltd.,
Class H* .................. 51,566
362,000 Zhejiang Expressway Co. Ltd.,
Class H ................... 41,827
--------------
562,751
--------------
HUNGARY - 4.50%
1,210 Danubius Hotel and Spa, Rights* 23,532
1,300 Gedeon Richter, Rights ....... 71,983
67,150 Magyar Tavkozlesi, Rights .... 460,025
5,730 MOL Magyar Olaj-es Gazipari,
Rights .................... 100,958
2,465 OTP Bank, Rights ............. 109,271
460 Pick Szeged, Rights .......... 17,471
--------------
783,240
--------------
INDIA - 2.74%
1,500 Bajaj Auto Ltd., SP GDR ...... 12,300
1,700 BSES Ltd., GDR* .............. 29,410
3,380 EIH Ltd., SP GDR ............. 15,210
1,267 Grasim Industries Ltd.,
SP GDR .................... 12,512
3,600 Gujarat Ambuja Cement Ltd.,
SP GDR .................... 16,020
1,610 Hindalco Industries Ltd.,
SP GDR .................... 27,370
3,530 Indian Hotels Co., Ltd, SP GDR 19,415
4,225 Indian Rayon & Industries Ltd.,
SP GDR .................... 6,549
1,180 Larsen & Tourbo Ltd., GDR .... 16,225
6,900 Mahanagar Telephone
Nigam Ltd., GDR ........... 90,131
4,200 Reliance Industries Ltd.,
SP GDR (A) ................ 109,305
3,300 State Bank of India, GDR ..... 31,350
4,124 Tata Engineering & Locomotive
Co., Ltd., SP GDR ......... 12,888
3,900 Videsh Sanchar Nigam Ltd., GDR 78,001
--------------
476,686
--------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
26
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
INDONESIA - 0.86%
33,000 PT Astra International Tbk ... $ 13,367
11,500 PT Gudang Garam Tbk .......... 18,196
79,000 PT Indah Kiat Pulp & Paper
Corp. Tbk* ................ 23,750
28,000 PT Indofood Sukses Makmur Tbk* 19,139
8,500 PT Semen Gresik (Persero) Tbk 8,823
153,720 PT Telekomunikasi Indonesia .. 67,131
--------------
150,406
--------------
ISRAEL - 1.94%
9,620 Bank Hapoalim ................ 29,548
13,500 Bank Leumi Le-Israel ......... 29,337
5,500 Bezeq Israeli Telecommunications
Corp. Ltd. ................ 29,186
1,520 Blue Square Chain Investments
and Properties Ltd. ....... 20,992
245 Check Point Software
Technologies Ltd.* ........ 42,462
950 ECI Telecom Ltd. ............. 26,422
290 Elite Industries Ltd. ........ 15,346
230 Formula Systems (1985) Ltd.* . 11,670
9,590 Israel Chemicals Ltd. ........ 11,621
160 Koor Industries Ltd. ......... 13,840
942 Magic Software Enterprises Ltd.* 16,043
7,200 Makhteshim-Agan Industries Ltd.* 14,203
110 NICE Systems Ltd., SP ADR* ... 7,195
900 Taro Pharmaceutical
Industries Ltd.* .......... 10,181
1,390 Teva Pharmaceuticals
Industries Ltd. ........... 59,724
--------------
337,770
--------------
MALAYSIA - 4.15%
13,000 Commerce Asset-Holdings Berhad 36,605
36,000 Malayan Banking Berhad ....... 149,684
41,000 Malaysia International Shipping
Corp. Berhad .............. 61,500
37,000 Malaysian Airline System Berhad 32,326
20,000 Petronas Gas Berhad .......... 32,632
57,000 Public Bank Berhad ........... 79,500
11,000 Resorts World Berhad ......... 35,605
30,000 RHB Captial Berhad ........... 42,632
25,000 Telekom Malaysia Berhad ...... 86,842
50,000 Tenaga Nasional Berhad ....... 165,789
--------------
723,115
--------------
MEXICO - 9.83%
16,600 Alfa SA de CV, Class A ....... 52,481
5,204 Cemex SA de CV, SP ADR* ...... 113,838
46,400 Desc SA de CV, Series B* ..... 32,741
2,000 Fomento Economico Mexicano
SA de CV, SP ADR .......... 82,500
26,000 Grupo Carso SA de CV,
Series A1* ................ 88,417
MARKET
SHARES VALUE
------- --------
MEXICO (CONTINUED)
23,900 Grupo Financiero Banamex
Accival, SA de CV, Series O* $ 86,609
54,673 Grupo Industrial Bimbo SA
de CV, Series A* .......... 71,464
17,710 Grupo Mexico SA, Series B .... 72,270
59,800 Grupo Modelo SA de CV Series C 125,828
1,982 Grupo Televisa SA, SP GDR* ... 125,733
7,100 Industrias Penoles SA ........ 15,845
28,200 Kimberley-Clark de Mexico SA,
Class A ................... 92,302
8,263 Savia SA de CV* .............. 47,769
9,447 Telefonos de Mexico SA, SP ADR 555,602
64,237 Wal-Mart de Mexico SA de CV,
Series V* ................. 148,817
--------------
1,712,216
--------------
PHILLIPINES - 1.51%
109,000 Ayala Land, Inc. ............. 17,161
11,000 Manila Electric Co., Class B . 19,717
9,680 Metropolitan Bank & Trust Co. 53,928
312,000 Petron Corp.* ................ 16,475
4,400 Phillipine Long Distance
Telephone Co. ............. 78,866
28,000 San Miguel Corp., Class B .... 35,267
312,000 SM Prime Holdings ............ 40,809
--------------
262,223
--------------
POLAND - 4.14%
2,900 Bank Handlowy w Warszawie .... 41,846
1,800 Bank Polska Kasa Opieki
Grupa Pekao SA* ........... 21,342
1,035 Bank Slaski SA w Katowicach .. 62,517
7,800 BIG Bank Gdanski SA .......... 19,195
1,115 BRE Bank SA .................. 34,922
2,130 Debica SA .................... 17,726
5,971 Elektrim Spolka Akcyjna SA ... 74,804
11,602 Polski Koncern Naftowy SA, GDR* 116,600
500 Prokom ....................... 20,302
280 Softbank SA .................. 12,089
5,240 Stomil Olsztyn SA ............ 25,555
33,000 Telekomunikacja Polska SA, GDR 253,275
3,558 Wielkopolski Bank
Kredytowy SA .............. 20,377
--------------
720,550
--------------
RUSSIA - 3.92%
2,500 AO Mosenergo, SP ADR ......... 15,850
4,400 OAO Lukoil Holding, SP ADR ... 265,232
8,500 RAO Unified Energy Systems, GDR* 158,411
3,300 Rostelecom, SP ADR* .......... 64,144
11,800 Surgutneftegaz, SP ADR* ...... 179,065
--------------
682,702
--------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
27
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
SOUTH AFRICA - 6.86%
5,780 ABSA Group Ltd. .............. $ 20,459
4,440 Anglo American Platinum
Corp. Ltd. ................ 107,390
910 Anglo American Plc ........... 38,571
1,100 AngloGold Ltd. ............... 41,855
8,670 Barlow Ltd. .................. 53,960
5,520 De Beers ..................... 113,160
4,100 Dimension Data Holdings Ltd.* 26,908
452 Edgars Consolidated Stores Ltd. 4,306
63,100 FirstRand Ltd. ............... 74,449
5,100 Gold Fields Ltd. ............. 16,547
1,200 Impala Platinum Holdings Ltd. 38,050
2,862 Imperial Holdings Ltd.* ...... 24,481
3,800 Johnnies Industrial Corp. Ltd. 48,197
1,841 Liberty International Plc .... 12,272
3,420 Liberty Life Association
of Africa Ltd. ............ 32,029
5,563 Nampak Ltd. .................. 12,963
5,700 Naspers Ltd., Class N ........ 58,845
4,900 Nedcor Ltd., GDR, Class S .... 91,875
13,640 Rembrandt Group Ltd. ......... 105,813
40,900 Sanlam Ltd. .................. 48,558
3,900 Sappi Ltd. ................... 27,321
9,200 Sasol Ltd. ................... 54,002
12,680 South African Breweries Plc .. 93,503
3,700 Standard Bank Investment
Corp. Ltd. ................ 13,642
1,525 Tigers Brands Limited ........ 15,519
4,300 Woolworths Holdings Ltd., GDR 20,425
--------------
1,195,100
--------------
SOUTH KOREA - 11.92%
8,500 Hyundai Motor Co. Ltd. ....... 80,041
8,800 Kookmin Bank ................. 95,157
13,100 Korea Electric Power Corp. ... 383,645
2,500 Korea Telecom Corp. .......... 170,759
4,283 L.G. Chemical Ltd. ........... 98,415
3,100 Pohang Iron & Steel Ltd., SP ADR 65,100
1,000 Samsung Electro-Mechanics Co. 68,033
2,319 Samsung Electronics .......... 626,898
3,300 Samsung SDI Co. Ltd. ......... 137,680
7,600 Shinhan Bank ................. 72,935
4,700 SK Corp. ..................... 88,727
710 SK Telecom Co. Ltd. .......... 188,736
--------------
2,076,126
--------------
MARKET
SHARES VALUE
------- --------
TAIWAN - 9.49%
8,856 Advanced Semiconductor
Engineering, Inc., GDR* .. $ 159,408
19,464 Asia Cement Corp., SP GDR .... 146,953
20,100 Asustek Computer, Inc., GDR .. 265,320
13,975 China Steel Corp., SP GDR .... 198,270
14,580 Evergreen Marine Corp.,
SP GDR* ................... 115,182
15,867 Standard Foods
Taiwan Ltd., GDR* ......... 53,154
4,900 Taiwan Semiconductor
Manufacturing Co., Ltd.,
SP ADR* ................... 256,331
14,486 Winbond Electronic Corp.,
GDR* ...................... 457,033
--------------
1,651,651
--------------
THAILAND - 1.79%
3,300 Advanced Info Service Public
Co. Ltd.* ................. 38,665
28,500 Bangkok Bank Public Co. Ltd.* 48,292
8,900 Electricity Generating Public
Co. Ltd. .................. 10,814
8,800 PTT Exploration & Production
Public Co. Ltd. ........... 44,618
2,000 Siam Cement Public Co. Ltd.* . 46,237
55,000 TelecomAsia Corp. Public Co. Ltd.* 73,690
47,000 Thai Farmers Bank Public Co. Ltd.* 49,389
--------------
311,705
--------------
TURKEY - 8.33%
1,332,618 Adana Cimento Sanayii Turk
Anomin Sirketi, Class A ... 46,314
569,000 Arcelik AS ................... 48,391
386,000 Aygaz AS ..................... 44,191
496,000 Brisa Bridgestone Sabanci
Lastik San. ve Tic AS ..... 36,504
919,900 Ege Biracilik ve Malt Sanayii AS 82,746
1,602,000 Eregli Demir ve Celik
Fabrikalari TAS* .......... 87,771
2,593,800 Haci Omer Sabanci Holding AS . 41,997
197,200 Migros Turk TAS .............. 133,845
300,600 Netas Northern Electric
Telekomunikasyon AS ....... 50,638
2,665,550 Trakya Cam Sanayii AS ........ 43,159
9,671,000 Turkiye Garanti Bankasi AS ... 162,913
6,735,900 Turkiye Is Bankasi, Class C .. 369,051
237,000 Vestel Elektronik Sanayi
ve Ticaret AS* ............ 89,150
6,727,479 Yapi ve Kredi Bankasi SA* .... 214,552
--------------
1,451,222
--------------
TOTAL COMMON STOCKS .......... 14,384,931
--------------
(Cost $12,604,280)
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
28
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
PREFERRED STOCKS - 10.78%
BRAZIL - 10.78%
23,400 Aracruz Celulose SA, Class B . $ 44,713
15,435,693 Banco Bradesco SA ............ 112,850
1,677,000 Banco Itau SA ................ 125,392
17,016,620 Centrais Electricas Brasileiras
SA, Class B ............... 280,861
2,121,000 Companhia Brasileira de
Distribuicao Grupo Pao
de Acucar ................. 60,499
105,300 Companhia Cervejaria Brahma .. 76,402
5,697,255 Companhia Energetica de
Minas Geraus .............. 86,776
9,162 Companhia Vale do Rio Doce,
Class A ................... 226,830
929,000 Petroleo Brasleiro SA ........ 221,303
5,030 Telecomunicacoes Brasileiras
SA, Pfd Block, SP ADR ..... 594,483
11,219 Usinas Siderurgicas de Minas
Gerais, Class A ........... 46,666
--------------
TOTAL PREFERRED STOCKS 1,876,775
--------------
(Cost $1,676,124)
INVESTMENT COMPANIES - 4.92%
24,800 Korea Fund * ................. 308,450
27,000 Taiwan Fund, Inc.* ........... 548,438
--------------
TOTAL INVESTMENT COMPANIES ... 856,888
--------------
(Cost $572,054)
MARKET
SHARES VALUE
------- --------
FOREIGN INDEX SECURITY - 2.57%
3,000 MSCI Taiwan OPAL ............. $ 446,880
--------------
TOTAL FOREIGN INDEX SECURITY . 446,880
--------------
(Cost $394,500)
TOTAL INVESTMENTS - 100.88% ................ 17,565,474
--------------
(Cost $15,246,958)**
LIABILITIES NET OF CASH
AND OTHER ASSETS - (0.88)% ............. (153,104)
--------------
NET ASSETS - 100.00% ....................... $ 17,412,370
==============
------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $15,246,958.
Gross unrealized appreciation ........... $ 4,374,256
Gross unrealized depreciation ........... (2,055,740)
--------------
Net unrealized appreciation ............. $ 2,318,516
==============
------------------
(A) Security exempt from registration under Rule 144A the Securities Act of
1933. This security may only be resold, in transactions exempt from
registration, to qualified institutional buyers. At April 30, 2000,
this security amounted to $109,305 or 0.63% of net assets.
ADR American Depositary Receipt
GDR Global Depositary Receipt
OPAL Optimised Portolios As Listed Security
SP ADR Sponsored American Depositary Receipt
SP GDR Sponsored Global Depositary Receipt
As of April 30, 2000, the Fund has entered into the following forward foreign
currency contracts:
FORWARD FOREIGN CURRENCY CONTRACTS SOLD:
<TABLE>
<CAPTION>
UNREALIZED
CURRENCY SETTLEMENT CONTRACTS AT IN EXCHANGE APPRECIATION
VALUE CONTRACTS TO DELIVER DATES VALUE FOR U.S. $ (DEPRECIATION)
----- -------------------- ----- ----- ----------- -------------
<S> <C> <C> <C> <C> <C>
1,043,750 KR 05/02/00 $ 941 $ 940 $ (1)
1,296 MR 05/03/00 341 316 (25)
146,486 MX 05/02/00 15,567 15,584 17
193,674 SA 05/02/00 28,563 28,315 (248)
391,292,194,228 TU 05/01/00 639,953 639,785 (168)
-------- -------- -----
$685,365 $684,940 $(425)
======== ======== =====
</TABLE>
--------------------
KR Korean Won
MR Malaysian Ringgit
MX Mexican Peso
SA South African Rand
TU Turkish Lira
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
29
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL BALANCED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 61.61%
ADVERTISING - 0.96%
82,800 Interpublic Group
of Companies, Inc. ........ $ 3,394,800
--------------
CONSUMER NON-DURABLES - 5.33%
132,000 Bestfoods .................... 6,633,000
250,800 Gillette Co. ................. 9,279,600
116,400 Newell Rubbermaid, Inc. ...... 2,931,825
--------------
18,844,425
--------------
ELECTRICAL - 1.63%
36,700 General Electric Co. ......... 5,771,075
--------------
FINANCE - 5.94%
28,900 American Express Co. ......... 4,336,806
58,400 American InternationalGroup, Inc. 6,405,750
73,700 Citigroup, Inc. .............. 4,380,544
142,900 Wells Fargo & Co. ............ 5,867,831
--------------
20,990,931
--------------
FOOD AND BEVERAGE - 3.78%
185,000 Coca-Cola Co. ................ 8,706,562
126,700 PepsiCo, Inc. ................ 4,648,306
--------------
13,354,868
--------------
HEALTH CARE SERVICES - 2.42%
103,600 Johnson & Johnson ............ 8,547,000
--------------
LODGING - 1.25%
138,600 Marriott International, Inc.,
Class A ................... 4,435,200
--------------
MEDICAL SUPPLIES - 3.98%
277,200 Boston Scientific Corp.* ..... 7,345,800
129,600 Medtronic, Inc. .............. 6,731,100
--------------
14,076,900
--------------
PHARMACEUTICALS - 7.35%
124,500 Bristol-Myers Squibb Co. ..... 6,528,469
330,000 Pfizer, Inc. ................. 13,901,250
138,100 Schering-Plough Corp. ........ 5,567,156
--------------
25,996,875
--------------
RESTAURANTS - 2.37%
219,900 McDonald's Corp. ............. 8,383,687
--------------
RETAIL - 7.26%
145,400 Circuit City Stores -
Circuit City Group ........ 8,551,337
85,400 Costco Wholesale Corp.* ...... 4,619,606
125,500 Gap, Inc. .................... 4,612,125
140,400 Home Depot, Inc. ............. 7,871,175
--------------
25,654,243
--------------
TECHNOLOGY - 13.28%
109,400 Dell Computer Corp.* ......... 5,480,256
78,000 Electronic Arts, Inc.* ....... 4,711,687
132,000 Electronic Data Systems Corp. 9,075,000
68,500 Hewlett-Packard Co. .......... 9,247,500
40,100 Intel Corp. .................. 5,086,434
MARKET
SHARES VALUE
------- --------
TECHNOLOGY (CONTINUED)
80,400 Microsoft Corp.* ............. $ 5,610,413
165,100 Solectron Corp.* ............. 7,728,744
--------------
46,940,034
--------------
TELECOMMUNICATIONS - 2.03%
157,750 MCI WorldCom, Inc.* .......... 7,172,695
--------------
TELECOMMUNICATIONS
EQUIPMENT - 4.03%
129,000 Lucent Technologies, Inc. .... 8,022,188
113,600 Tellabs, Inc.* ............... 6,230,250
--------------
14,252,438
--------------
TOTAL COMMON STOCKS .......... 217,815,171
--------------
(Cost $188,807,743)
PAR VALUE
-----------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 15.26%
FEDERAL HOME LOAN BANK - 1.10%
$ 3,000,000 5.125%, 04/17/01 ............. 2,957,370
1,000,000 5.890%, 06/30/08,
Series GJ08 ............... 912,970
--------------
3,870,340
--------------
FEDERAL HOME LOAN MORTGAGE
CORPORATION - 2.20%
3,900,000 6.250%, 10/15/02 ............. 3,818,958
750,000 6.400%, 12/13/06,
Debenture ................. 714,405
1,750,000 6.700%, 01/05/07 ............. 1,693,668
600,000 7.500%, 03/15/07, CMO,
Class J ................... 589,248
175,000 6.000%, 04/15/08, CMO,
Class K ................... 172,491
424,319 6.500%, 07/15/20, CMO,
Class F ................... 420,292
400,000 6.500%, 11/15/20, CMO,
Class H ................... 387,324
--------------
7,796,386
--------------
FEDERAL NATIONAL
MORTGAGE ASSOCIATION - 1.85%
4,750,000 5.750%, 04/15/03 ............. 4,566,935
2,000,000 7.250%, 01/17/21,
CMO, REMIC, Class P ....... 1,979,360
--------------
6,546,295
--------------
GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION - 0.00%
983 8.500%, 06/15/01 ............. 1,004
1,709 9.000%, 09/15/08 ............. 1,767
--------------
2,771
--------------
U.S. TREASURY BONDS - 7.03%
4,625,000 7.250%, 05/15/16 ............. 5,064,329
6,000,000 8.125%, 08/15/19 ............. 7,219,440
3,750,000 8.000%, 11/15/21 ............. 4,515,825
5,000,000 6.250%, 08/15/23 ............. 5,005,500
2,800,000 6.875%, 08/15/25 ............. 3,035,620
--------------
24,840,714
--------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
30
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL BALANCED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
U.S. TREASURY NOTES - 3.08%
$ 6,700,000 6.625%, 04/30/02 ............. $ 6,693,166
3,225,000 5.750%, 08/15/03 ............. 3,145,633
1,000,000 7.875%, 11/15/04 ............. 1,050,060
--------------
10,888,859
--------------
TOTAL U.S. GOVERNMENT AND
AGENCY OBLIGATIONS ........... 53,945,365
--------------
(Cost $54,874,747)
CORPORATE NOTES AND BONDS - 10.40%
CONSUMER NON-DURABLES - 1.60%
3,750,000 Daimlerchrysler NA
7.400%, 01/20/05 .......... 3,721,875
2,000,000 Nike, Inc.,
6.375%, 12/01/03 .......... 1,930,000
--------------
5,651,875
--------------
ENERGY - 1.07%
4,000,000 Conoco Inc.,
5.900%, 04/15/04 .......... 3,770,000
--------------
FINANCE - 3.71%
3,000,000 American Express Co., Senior Notes
6.750%, 06/23/04 .......... 2,925,000
3,000,000 Ford Motor Credit Co., Inc.
Senior Notes
7.000%, 09/25/01 .......... 2,981,250
1,350,000 Household Finance Corp., MTN
7.300%, 07/30/12 .......... 1,267,313
3,300,000 National Rural Utilities,
Collateral Trust
6.200%, 02/01/08 .......... 3,048,375
2,500,000 Nationsbank Corp.
6.875%, 02/15/05 .......... 2,409,375
500,000 Salomon, Inc.
7.300% 05/15/02 ........... 498,750
--------------
13,130,063
--------------
PHARMACEUTICALS - 1.24%
2,100,000 Amgen, Inc.
6.500%, 12/01/07 .......... 1,981,875
2,500,000 Warner-Lambert Co.
5.750%, 01/15/03 .......... 2,406,250
--------------
4,388,125
--------------
RETAIL - 1.74%
500,000 Penney (J.C.) Company, Inc.,
Debentures
9.750%, 06/15/21 .......... 434,375
2,750,000 Sears Roebuck Acceptance Corp.
6.700%, 11/15/06 .......... 2,543,750
3,300,000 Wal-Mart Stores, Inc., Senior Notes
6.875%, 08/10/09 .......... 3,180,375
--------------
6,158,500
--------------
UTILITY - 1.04%
3,700,000 Bellsouth Capital Funding Corp.
7.750%, 02/15/10 .......... 3,686,125
--------------
TOTAL CORPORATE NOTES AND BONDS 36,784,688
--------------
(Cost $38,523,408)
MARKET
PAR VALUE VALUE
----------- --------
ASSET-BACKED SECURITIES - 2.60%
$ 4,000,000 Discover Card Masters Trust 1,
Series 1998-7, Class A
5.600%, 05/15/06 .......... $ 3,772,450
1,750,000 First USA Credit Card Master
Trust, Series 1997-6, Class A
6.420%, 03/17/05 .......... 1,714,353
4,000,000 PECO Energy Transition Trust,
Series 1999-A, Class A-6
6.050%, 03/01/09 .......... 3,700,800
--------------
TOTAL ASSET-BACKED SECURITIES 9,187,603
--------------
(Cost $9,472,840)
REPURCHASE AGREEMENT - 6.75%
23,858,000 Bankers Trust 5.450%, dated
04/28/00 to be repurchased
on 05/01/00 at $23,868,836
(Collateralized by U.S.
Treasury Note 6.500% due
05/31/00; Total Par Value
$23,727,000) .............. 23,858,000
--------------
TOTAL REPURCHASE AGREEMENT ... 23,858,000
--------------
(Cost $23,858,000)
SHARES
--------
INVESTMENT COMPANIES - 0.05%
154,405 Bankers Trust Institutional
Cash Management Fund ...... 154,405
21,210 Bankers Trust Institutional
Treasury Money Fund ....... 21,210
--------------
TOTAL INVESTMENT COMPANIES ... 175,615
--------------
(Cost $175,615)
TOTAL INVESTMENTS - 96.67% ................. 341,766,442
--------------
(Cost $315,712,353)**
NET OTHER ASSETS AND LIABILITIES - 3.33% ... 11,790,427
--------------
NET ASSETS - 100.00% ....................... $ 353,556,869
==============
------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $315,712,353.
Gross unrealized appreciation ..... $ 40,396,723
Gross unrealized depreciation ..... (14,342,634)
--------------
Net unrealized appreciation ....... $ 26,054,089
==============
CMO Collateralized Mortgage Obligation
MTN Medium Term Note
REMIC Real Estate Mortgage Investment Conduit
PORTFOLIO COMPOSITION (MOODY'S RATINGS)
Common Stocks ......................................... 62%
Repurchase Agreement .................................. 7%
U.S. Government Obligations ........................... 10%
U.S. Government Agency Obligations .................... 5%
Corporate Notes and Bonds:
Aaa ................................................... 3%
Aa .................................................... 4%
A ..................................................... 7%
NR .................................................... 2%
---
100%
===
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
31
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BALANCED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
------- --------
COMMON STOCKS - 60.64%
ADVERTISING - 1.46%
50,000 Omnicom Group, Inc. .......... $ 4,553,125
--------------
CAPITAL GOODS - 0.98%
75,000 Pitney Bowes, Inc. ........... 3,065,625
--------------
CHEMICALS - 0.86%
60,000 Praxair, Inc. ................ 2,666,250
--------------
COMMERCIAL SERVICES - 1.57%
125,000 Ecolab, Inc. ................. 4,882,812
--------------
CONSUMER DURABLES - 4.69%
151,000 Harley-Davidson, Inc. ........ 6,011,687
65,000 Illinois Tool Works, Inc. .... 4,164,062
70,000 Johnson Controls, Inc. ....... 4,431,875
--------------
14,607,624
--------------
CONSUMER NON-DURABLES - 2.02%
105,000 Cintas Corp. ................. 4,157,344
36,000 Procter & Gamble Co. ......... 2,146,500
--------------
6,303,844
--------------
ELECTRICAL - 1.92%
38,000 General Electric Co. ......... 5,975,500
--------------
ENTERTAINMENT AND LEISURE - 0.68%
85,000 Carnival Corp. ............... 2,114,375
--------------
FINANCE - 8.59%
80,000 AFLAC, Inc. .................. 3,905,000
50,000 American International
Group, Inc. ............... 5,484,375
100,000 Associates First Capital Corp.,
Class A ................... 2,218,750
90,000 Federal Home Loan
Mortgage Corp. ............ 4,134,375
41,000 Marsh & McLennan Cos., Inc. .. 4,041,062
95,000 MBNA Corp. ................... 2,523,437
100,000 Schwab (Charles) Corp. ....... 4,450,000
--------------
26,756,999
--------------
FOOD AND BEVERAGE - 2.42%
200,000 Sysco Corp. .................. 7,525,000
--------------
HEALTH CARE SERVICES - 1.33%
75,000 Cardinal Health, Inc. ........ 4,129,688
--------------
MEDICAL SUPPLIES - 2.00%
200,000 Sybron International Corp.* .. 6,225,000
--------------
OIL AND GAS EXTRACTION - 2.06%
75,000 Schlumberger, Ltd. ........... 5,742,188
14,520 Transocean Sedco Forex, Inc. . 682,440
--------------
6,424,628
--------------
PHARMACEUTICALS - 2.16%
36,000 Merck & Co., Inc. ............ 2,502,000
100,000 Pfizer, Inc. ................. 4,212,500
--------------
6,714,500
--------------
MARKET
SHARES VALUE
------- --------
RETAIL - 2.98%
100,000 Kohl's Corp.* ................ $ 4,800,000
160,000 Walgreen Co. ................. 4,500,000
--------------
9,300,000
--------------
TECHNOLOGY - 18.33%
120,000 Cisco Systems, Inc.* ......... 8,325,000
80,000 Computer Associates
International, Inc. ....... 4,465,000
50,000 Computer Sciences Corp.* ..... 4,078,125
98,000 Dell Computer Corp.* ......... 4,909,188
93,000 Electronic Data Systems Corp. 6,393,750
65,000 EMC Corp.* ................... 9,030,938
79,000 Microsoft Corp.* ............. 5,512,719
140,000 Solectron Corp.* ............. 6,553,750
85,000 Sun Microsystems, Inc.* ...... 7,817,344
--------------
57,085,814
--------------
TELECOMMUNICATIONS
EQUIPMENT - 4.28%
138,000 Nokia Corp., ADR ............. 7,848,750
100,000 Tellabs, Inc.* ............... 5,484,375
--------------
13,333,125
--------------
UTILITY - 2.31%
80,000 AES Corp.* ................... 7,195,000
--------------
TOTAL COMMON STOCKS .......... 188,858,909
--------------
(Cost $103,522,565)
PAR VALUE
-----------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 21.07%
FEDERAL HOME LOAN BANK - 1.68%
$ 3,115,000 6.000%, 08/15/02 ............. 3,038,776
2,300,000 6.500%, 11/15/06, Series PX02 2,204,021
--------------
5,242,797
--------------
FEDERAL HOME LOAN MORTGAGE
CORPORATION - 3.03%
3,750,000 5.750%, 07/15/03, Debentures . 3,592,988
1,000,000 5.850%, 02/21/06, Series TD06 929,020
523,970 7.500%, 04/01/08,
Gold Pool #E46250 ........ 521,350
558,286 6.500%, 06/01/09,
Gold Pool #E59122 ........ 534,732
3,354,625 6.000%, 10/15/11, CMO,
Interest Only, Series 2101
Class TY .................. 500,007
1,260,157 6.500%, 06/01/29,
Gold Pool #C00785 ........ 1,178,247
2,223,749 7.500%, 11/01/29,
Gold Pool #C32468 ........ 2,179,964
--------------
9,436,308
--------------
FEDERAL NATIONAL
MORTGAGE ASSOCIATION - 7.07%
3,750,000 5.625%, 03/15/01 ............. 3,719,963
896,615 7.000%, 01/01/13, Pool #313966 876,154
676,949 7.000%, 03/01/13, Pool #251572 661,501
1,408,655 6.000%, 08/01/13, Pool #323250 1,320,163
122,872 7.000%, 07/25/17, CMO, REMIC,
Pool #001993, Series 155,
Class EA, Interest Only ... 1,697
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
32
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BALANCED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
FEDERAL NATIONAL
MORTGAGE ASSOCIATION (CONTINUED)
$ 561,035 7.500%, 02/01/23, Pool #050706 $ 549,287
157,535 9.000%, 05/01/25, Pool #250239 161,916
1,258,266 6.500%, 12/01/27, Pool #40284 61,174,906
587,434 6.500%, 02/01/28, Pool #398205 548,516
2,154,219 7.000%, 08/01/28, Pool #437140 2,061,975
1,146,588 6.500%, 09/01/28, Pool #430877 1,070,626
1,426,422 6.500%, 03/01/29, Pool #489367 1,331,921
2,325,677 6.000%, 06/01/29, Pool #190302 2,106,900
1,100,122 6.500%, 06/01/29, Pool #501319 1,027,239
1,086,959 6.500%, 07/01/29, Pool #503280 1,014,948
2,250,000 7.500%, 04/01/30, Pool #536618 2,202,070
2,250,000 7.500%, 05/01/30, Pool #536420 2,202,070
--------------
22,031,852
--------------
GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION - 4.50%
1,611,974 7.000%, 12/15/11, Pool #781011 1,583,249
503,176 8.000%, 06/15/17, Pool #191897 504,745
1,019,921 7.000%, 09/15/23, Pool #361807 981,674
528,048 7.000%, 10/15/23, Pool #345894 508,246
700,282 7.000%, 10/15/23, Pool #370850 674,021
2,759,416 7.500%, 07/15/25, Pool #409561 2,715,431
1,112,166 6.500%, 03/15/26, Pool #422527 1,042,656
254,018 7.500%, 06/15/27, Pool #446811 249,969
1,224,950 7.500%, 06/15/27, Pool #447652 1,205,424
765,209 6.500%, 08/15/27, Pool #780615 717,858
381,286 7.500%, 07/15/28, Pool #464709 375,209
1,860,784 6.000%, 01/15/29, Pool #457858 1,692,141
1,834,641 7.000%, 03/15/29, Pool #505567 1,765,842
--------------
14,016,465
--------------
U.S. TREASURY BONDS - 1.77%
1,500,000 7.125%, 02/15/23 ............. 1,658,145
1,900,000 6.250%, 08/15/23 ............. 1,902,090
2,000,000 6.000%, 02/15/26 ............. 1,948,600
--------------
5,508,835
--------------
U.S. TREASURY NOTES - 3.02%
2,100,000 6.375%, 08/15/02 ............. 2,088,072
1,500,000 5.750%, 08/15/03 ............. 1,463,085
2,400,000 5.875%, 02/15/04 ............. 2,345,304
3,500,000 6.500%, 08/15/05 ............. 3,493,350
--------------
9,389,811
--------------
TOTAL U.S. GOVERNMENT AND
AGENCY OBLIGATIONS ........... 65,626,068
--------------
(Cost $67,767,421)
CORPORATE NOTES AND BONDS - 13.17%
CABLE TELEVISION - 0.76%
CSC Holdings, Inc., Senior Notes
1,500,000 7.875%, 12/15/07 .......... 1,411,875
1,070,000 7.250%, 07/15/08 .......... 968,350
--------------
2,380,225
--------------
ENERGY - 0.32%
1,100,000 CMS Energy Corp., Senior Notes
7.625%, 11/15/04 .......... 1,012,000
--------------
MARKET
PAR VALUE VALUE
----------- --------
FINANCE - 4.08%
$ 1,500,000 Advanta Corp., MTN
7.000%, 05/01/01 .......... $ 1,438,125
1,250,000 Chelsea GCA Reality
Partnership, REIT
7.250%, 10/21/07 .......... 1,131,250
1,625,000 Duke Capital Corp., Senior Notes
7.250%, 10/01/04 .......... 1,590,469
1,000,000 DVI, Inc., Senior Notes
9.875%, 02/01/04 .......... 921,250
1,000,000 Federal Realty Investment Trust
8.750%, 12/01/09 .......... 987,500
2,000,000 HSBC America Capital Trust II
8.380%, 05/15/27 (A) ...... 1,905,000
2,000,000 Metropolitan Life Insurance Co.
6.300%, 11/01/03 (A) ...... 1,922,500
1,800,000 Pacific Mutual Life Insurance Co.
7.900%, 12/30/23 (A) ...... 1,779,750
1,000,000 Prudential Insurance Co.
of America
8.300%, 07/01/25 (A) ...... 1,027,500
--------------
12,703,344
--------------
FOOD AND BEVERAGE - 0.63%
Nabisco, Inc.
1,000,000 6.700%, 06/15/02 .......... 955,000
1,125,000 6.850%, 06/15/05 .......... 1,020,938
--------------
1,975,938
--------------
HEALTH CARE SERVICES - 1.79%
1,100,000 Columbia/HCA Healthcare,
Debentures
6.049%, 06/01/00 (B) ...... 1,091,750
1,500,000 HealthSouth Corp., Senior Notes
6.875%, 06/15/05 .......... 1,297,500
3,000,000 Omnicare, Inc.
5.000%, 12/01/07 .......... 2,366,250
1,000,000 Tenet Healthcare Corp.,
Subordinated Notes
6.000%, 12/01/05 .......... 810,000
--------------
5,565,500
--------------
METALS AND MINING - 0.55%
1,800,000 Lukens, Inc.
7.625%, 08/01/04 .......... 1,703,250
--------------
OIL AND GAS EXTRACTION - 0.47%
1,625,000 Conoco, Inc., Senior Notes
6.950%, 04/15/29 .......... 1,462,500
--------------
PRINTING AND PUBLISHING - 0.57%
2,000,000 News America Holdings, Inc.,
Debentures
7.750%, 02/01/24 .......... 1,770,000
--------------
RETAIL - 1.04%
2,000,000 K-Mart Corp., Debentures
7.950%, 02/01/23 .......... 1,697,500
2,975,000 Pep Boys - Manny, Moe & Jack,
Subordinated Debentures
3.031%, 09/20/11 (B) ...... 1,539,563
--------------
3,237,063
--------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
33
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BALANCED FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
TECHNOLOGY - 0.80%
$ 1,500,000 Motorola, Inc., Debentures
6.500%, 11/15/28 .......... $ 1,271,250
1,325,000 Thermo Electron Corp.,
Subordinated Debentures
4.250%, 01/01/03 (A) ...... 1,210,719
--------------
2,481,969
--------------
TELECOMMUNICATIONS - 0.57%
2,000,000 AT&T Corp.
6.000%, 03/15/09 .......... 1,787,500
--------------
TRANSPORTATION - 0.61%
1,567,215 American Airlines, Inc.,
Series 1999-1
6.855%, 04/15/09 .......... 1,522,212
367,068 Delta Air Lines Equipment Trust,
Series 1992-A
8.540%, 01/02/07 .......... 367,829
--------------
1,890,041
--------------
UTILITIES - 0.69%
1,000,000 Gulf States Utilities, First
Mortgage, Series A
8.250%, 04/01/04 .......... 1,006,250
1,500,000 Niagara Mohawk Power Corp.,
Series H, Senior Notes, Step
Coupon, 8.500%, 07/01/10 .. 1,151,250
--------------
2,157,500
--------------
WASTE DISPOSAL - 0.29%
1,000,000 Waste Management Inc.,
Subordinated Notes
4.000%, 02/01/02 .......... 895,000
--------------
TOTAL CORPORATE NOTES
AND BONDS .................... 41,021,830
--------------
(Cost $42,631,991)
YANKEE BONDS - 1.02%
1,000,000 Petroliam Nasional Berhad
7.625%, 10/15/26 (A) ...... 862,500
1,090,500 Province of Mendoza,
Collateral Oil Royalty Note
10.000%, 07/25/02 (A) ..... 1,090,391
1,250,000 Skandinaviska Enskilda,
Subordinated Notes
6.625%, 03/29/49 (A) ...... 1,225,000
--------------
TOTAL YANKEE BONDS ........... 3,177,891
--------------
(Cost $2,942,894)
NON-AGENCY/CMO MORTGAGE SECURITIES - 0.75%
600,000 Midland Realty Acceptance Corp.,
CMO, Series 1996-C1, Class A2,
7.475%, 08/25/28 (C) ...... 596,719
1,000,000 Morgan (J.P.) Commercial
Mortgage Finance Corp., CMO,
Series 1999-C7, Class A2,
6.507%, 10/15/35 (C) ...... 924,141
847,895 Nomura Asset Securities Corp.,
Series 1998-D6, Class A1A,
6.280%, 03/17/28 .......... 808,061
--------------
TOTAL NON-AGENCY/CMO
MORTGAGE SECURITIES .......... 2,328,921
--------------
(Cost $2,448,587)
MARKET
PAR VALUE VALUE
----------- --------
ASSET-BACKED SECURITY - 0.49%
$ 1,544,971 DVI Receivables Corp.,
Series 1998-1, Class A2,
6.035%, 04/10/06 (A) ...... $ 1,532,298
--------------
TOTAL ASSET-BACKED SECURITIES 1,532,298
--------------
(Cost $1,542,782)
REPURCHASE AGREEMENT - 1.79%
5,570,000 Bank One 5.850%, dated
04/28/00 to be repurchased
on 05/01/00 at $5,572,715
(Collateralized by U.S.
Government Agency Obligations
with Interest rates from 6.000%
to 7.000% and maturities from
08/20/01 to 02/14/03;
Total Par Value $5,660,000) 5,570,000
--------------
TOTAL REPURCHASE AGREEMENT ... 5,570,000
--------------
(Cost $5,570,000)
TOTAL INVESTMENTS - 98.93% ................. 308,115,917
--------------
(Cost $226,426,240)**
NET OTHER ASSETS AND LIABILITIES - 1.07% ... 3,342,418
--------------
NET ASSETS - 100.00% ....................... $ 311,458,335
==============
-------------------
* Non-income producing security.
** Aggregate cost for Federal income tax purposes is $226,426,240.
Gross unrealized appreciation .......... $ 89,357,213
Gross unrealized depreciation .......... (7,667,536)
--------------
Net unrealized appreciation ............ $ 81,689,677
==============
-------------------
(A) Securities exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may only be resold, in transactions exempt
from registration, to qualified institutional buyers. At April 30, 2000,
these securities amounted to $12,555,658 or 4.03% of net assets.
(B) Zero Coupon Bond. Rate shown reflects effective yield to
maturity at time of purchase.
(C) Standard & Poor's (S&P) credit ratings are used in the absence of a
rating by Moody's Investors, Inc.
CMO Collateralized Mortgage Obligation
MTN Medium Term Note
REIT Real Estate Investment Trust
REMIC Real Estate Mortgage Investment Conduit
PORTFOLIO COMPOSITION (MOODY'S RATINGS)
Common Stocks ......................................... 61%
Repurchase Agreement .................................. 2%
U.S. Government Obligations ........................... 5%
U.S. Government Agency Obligations .................... 17%
Corporate Notes and Bonds:
Aaa ................................................... 1%
Aa .................................................... 2%
A ..................................................... 3%
Baa ................................................... 3%
Ba .................................................... 4%
B ..................................................... 1%
NR .................................................... 1%
---
100%
===
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
34
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BOND FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
U.S. GOVERNMENT AND
AGENCY OBLIGATIONS - 48.36%
FEDERAL HOME LOAN BANK - 3.58%
$ 2,500,000 6.000%, 08/15/02 ............. $ 2,438,825
2,700,000 6.500%, 11/15/06, Series PX02 2,587,329
--------------
5,026,154
--------------
FEDERAL HOME LOAN
MORTGAGE CORPORATION - 10.44%
4,000,000 5.750%, 07/15/03, Debentures . 3,832,520
2,500,000 5.850%, 02/21/06,
Series TD06 ............... 2,322,550
5,026,201 6.000%, 11/15/10,
CMO, Pool #002115 ......... 523,042
982,355 6.500%, 01/01/11,
Gold Pool #E00413 ......... 940,910
2,900,543 7.500%, 11/01/29,
Gold Pool #C32468 ......... 2,843,431
4,174,922 8.000%, 02/01/30,
Pool #C00922 .............. 4,177,511
--------------
14,639,964
--------------
FEDERAL NATIONAL
MORTGAGE ASSOCIATION - 18.41%
2,000,000 5.625%, 03/15/01 ............. 1,983,980
1,494,358 7.000%, 01/01/13, Pool #313966 1,460,257
1,150,814 7.000%, 03/01/13, Pool #251572 1,124,552
2,536,756 6.000%, 06/01/13, Pool #429584 2,377,397
1,074,925 7.500%, 07/01/23, Pool #226065 1,052,416
1,264,626 7.500%, 11/01/27, Pool #402193 1,238,145
1,834,540 6.500%, 09/01/28, Pool #430877 1,713,002
2,663,103 6.500%, 10/01/28, Pool #442329 2,486,672
2,685,317 6.000%, 06/01/29, Pool #190302 2,432,710
1,745,834 6.500%, 06/01/29, Pool #501319 1,630,172
1,748,586 6.500%, 07/01/29, Pool #503280 1,632,742
2,561,851 7.500%, 11/01/29, Pool #252874 2,508,206
4,279,959 7.500%, 02/01/30, Pool #529028 4,190,337
--------------
25,830,588
--------------
GOVERNMENT NATIONAL
MORTGAGE ASSOCIATION - 10.04%
924,084 7.000%, 10/15/23, Pool #345894 889,431
1,112,166 6.500%, 03/15/26, Pool #422527 1,042,656
1,026,284 7.000%, 06/15/27, Pool #780584 988,435
1,610,495 6.500%, 09/20/27, Pool #002482 1,502,785
991,344 7.500%, 07/15/28, Pool #464709 975,542
5,170,491 7.000%, 09/15/28, Pool #458926 4,976,597
2,141,358 6.000%, 01/15/29, Pool #457858 1,947,287
1,834,641 7.000%, 03/15/29, Pool #505567 1,765,842
--------------
14,088,575
--------------
U.S. TREASURY BONDS - 5.89%
$ 2,500,000 7.125%, 02/15/23 ............. $ 2,763,575
1,600,000 6.250%, 08/15/23 ............. 1,601,760
4,000,000 6.000%, 02/15/26 ............. 3,897,200
--------------
8,262,535
--------------
TOTAL U.S. GOVERNMENT
AND AGENCY OBLIGATIONS ....... 67,847,816
--------------
(Cost $70,147,532)
CORPORATE NOTES AND BONDS - 39.94%
CABLE TELEVISION - 2.18%
CSC Holdings, Inc., Senior Notes
2,000,000 7.875%, 12/15/07 ............. 1,882,500
1,300,000 7.250%, 07/15/08 ............. 1,176,500
--------------
3,059,000
--------------
ENERGY - 1.82%
1,300,000 CMS Energy Corp., Senior Notes
7.625%, 11/15/04 .......... 1,196,000
1,500,000 CMS Energy Corp., Senior Notes
Series B, 7.250%, 07/15/08 1,357,500
--------------
2,553,500
--------------
FINANCE - 11.27%
2,000,000 Advanta Corp., MTN
7.000%, 05/01/01 .......... 1,917,500
1,700,000 Chelsea GCA Reality
Partnership, REIT
7.250%, 10/21/07 .......... 1,538,500
1,000,000 Continental Corp. (The)
7.250%, 03/01/03 .......... 981,250
1,250,000 Duke Capital Corp., Senior Notes
7.250%, 10/01/04 .......... 1,223,437
500,000 DVI, Inc., Senior Notes
9.875%, 02/01/04 .......... 460,625
1,200,000 Federal Realty Investment Trust
8.750%, 12/01/09 .......... 1,185,000
670,000 HSBC America Capital Trust I
7.808%, 12/15/26 (A) ...... 610,537
2,000,000 HSBC America Capital Trust II
8.380%, 05/15/27 (A) ...... 1,905,000
1,500,000 Metropolitan Life Insurance Co.
6.300%, 11/01/03 (A) ...... 1,441,875
2,000,000 Pacific Mutual Life Insurance Co.
7.900%, 12/30/23 (A) ...... 1,977,500
2,500,000 Prudential Insurance Co.
of America
8.300%, 07/01/25 (A) ...... 2,568,750
--------------
15,809,974
--------------
FOOD AND BEVERAGE - 1.46%
2,250,000 Nabisco, Inc.
6.850%, 06/15/05 .......... 2,041,875
--------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
35
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BOND FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
HEALTH CARE SERVICES - 5.98%
$ 1,200,000 Columbia/HCA Healthcare Corp.
6.125%, 12/15/00 .......... $ 1,179,000
1,375,000 HealthSouth Corp.
3.250%, 04/01/03 .......... 1,086,250
2,000,000 HealthSouth Corp., Senior Notes
6.875%, 06/15/05 .......... 1,730,000
3,000,000 Omnicare, Inc.
5.000%, 12/01/07 .......... 2,366,250
2,500,000 Tenet Healthcare Corp.,
Subordinated Notes
6.000%, 12/01/05 .......... 2,025,000
--------------
8,386,500
--------------
METALS AND MINING - 1.86%
2,750,000 Lukens, Inc.
7.625%, 08/01/04 .......... 2,602,187
--------------
OIL AND GAS EXTRACTION - 1.60%
2,500,000 Conoco, Inc., Senior Notes
6.950%, 04/15/29 .......... 2,250,000
--------------
PRINTING AND PUBLISHING - 1.58%
News America Holdings, Inc.,
Debentures
2,000,000 7.750%, 01/20/24 .......... 1,772,500
500,000 7.750%, 02/01/24 .......... 442,500
--------------
2,215,000
--------------
RETAIL - 2.36%
2,375,000 K-Mart Corp., Debentures
7.950%, 02/01/23 .......... 2,015,781
2,500,000 Pep Boys - Manny, Moe & Jack,
Subordinated Debentures
3.031%, 09/20/11 (B) ...... 1,293,750
--------------
3,309,531
--------------
TECHNOLOGY - 2.25%
2,000,000 Motorola, Inc., Debentures
6.500%, 11/15/28 .......... 1,695,000
1,600,000 Thermo Electron Corp.,
Subordinated Debentures
4.250%, 01/01/03 (A) ...... 1,462,000
--------------
3,157,000
--------------
TELECOMMUNICATIONS - 1.91%
3,000,000 AT&T Corp.
6.000%, 03/15/09 .......... 2,681,250
--------------
TRANSPORTATION - 1.30%
1,871,301 American Airlines, Inc.,
Series 1999-1
6.855%, 04/15/09 .......... 1,817,567
--------------
MARKET
PAR VALUE VALUE
----------- --------
UTILITIES - 2.62%
$ 1,750,000 Gulf States Utilities,
First Mortgage, Series A
8.250%, 04/01/04 .......... $ 1,760,938
2,500,000 Niagra Mohawk Power Corp.
Series H, Senior Notes,
Step Coupon
8.500%, 07/01/10 .......... 1,918,750
--------------
3,679,688
--------------
WASTE DISPOSAL - 1.75%
2,750,000 Waste Management Inc.,
Subordinated Notes
4.000%, 02/01/02 .......... 2,461,250
--------------
TOTAL CORPORATE NOTES
AND BONDS .................... 56,024,322
--------------
(Cost $57,820,146)
YANKEE BONDS - 3.41%
1,250,000 Petroliam Nasional Berhad
7.625%, 10/15/26 (A) ...... 1,078,125
2,237,250 Province of Mendoza
Collateral Oil Royality Note
10.000%, 07/25/02 (A) ..... 2,237,026
1,500,000 Skandinaaviska Enskilda,
Subordinated Notes
6.625%, 03/29/49 (A) ...... 1,470,000
--------------
TOTAL YANKEE BONDS ........... 4,785,151
--------------
(Cost $4,534,654)
NON-AGENCY/CMO MORTGAGE SECURITIES - 2.13%
1,000,000 First Union - Lehman Bros.,
CMO Series 1997-C2, Class A2
6.600%, 05/18/07 .......... 961,180
875,000 Midland Realty Acceptance Corp.,
CMO, Series 1996-C1, Class A2
7.475%, 08/25/28 (C) ...... 870,215
1,250,000 Morgan (J.P.) Commercial
Mortgage Financial Corp., CMO,
Series 1999-C7, Class A2
6.507%, 10/15/35 (C) ...... 1,155,176
--------------
TOTAL NON-AGENCY/
CMO MORTGAGE SECURITIES ...... 2,986,571
--------------
(Cost $3,134,744)
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
36
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BOND FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
REPURCHASE AGREEMENT - 4.88%
$ 6,843,000 Bank One 5.850%, dated
04/28/00 to be repurchased
on 05/01/00 at $6,846,336
(Collateralized by U.S.
Government Agency Obligations
with interest rates from 5.125%
to 8.000% and maturities from
02/14/03 to 08/19/14;
Total Par $7,145,000) ..... $ 6,843,000
--------------
TOTAL REPURCHASE AGREEMENT ... 6,843,000
--------------
(Cost $6,843,000)
TOTAL INVESTMENTS - 98.72% ................. 138,486,860
--------------
(Cost $142,480,076)**
NET OTHER ASSETS AND LIABILITIES - 1.28% ... 1,801,170
--------------
NET ASSETS - 100.00% ....................... $ 140,288,030
==============
--------------------
** Aggregate cost for Federal income tax purposes is $142,480,076.
Gross unrealized appreciation .......... $ 908,769
Gross unrealized depreciation .......... (4,901,985)
--------------
Net unrealized depreciation ............ $ (3,993,216)
==============
--------------------
(A) Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold, in transactions exempt from
registration, to qualified institutional buyers. At April 30, 2000, these
securities amounted to $14,750,813 or 10.51% of net assets.
(B) Zero Coupon Bond. Rate shown reflects effective yield to maturity at time
of purchase.
(C) Standard & Poor's (S&P) credit ratings are used in the absence of a rating
by Moody's Investors, Inc.
CMO Collateralized Mortgage Obligation
MTN Medium Term Note
REIT Real Estate Investment Trust
PORTFOLIO COMPOSITION (MOODY'S RATINGS)
Repurchase Agreement .................................. 5%
U.S. Government Obligations ........................... 6%
U.S. Government Agency Obligations .................... 42%
Corporate Notes and Bonds:
Aa .................................................... 6%
A ..................................................... 7%
Baa ................................................... 10%
Ba .................................................... 15%
B ..................................................... 2%
NR .................................................... 7%
---
100%
===
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
37
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
MUNICIPAL BONDS - 94.99%
ALASKA - 1.68%
$ 280,000 Anchorage Alaska G.O.
5.000%, 07/01/13,
Insured: MBIA ............. $ 268,878
--------------
ARIZONA - 7.32%
500,000 Phoenix Civic Improvement Corp.,
Water System Revenue,
Junior Lien
6.000%, 07/01/02 .......... 511,745
450,000 Salt River Project, Agricultural
Improvement and Power District
Electric System Revenue
Refunding, Series A
5.500%, 01/01/05 .......... 459,148
200,000 Tucson, Arizona Water Revenue,
5.400%, 07/01/05 .......... 203,548
--------------
1,174,441
--------------
CALIFORNIA - 5.35%
350,000 San Francisco City and
Airports Revenue, Series 23-A,
5.500%, 05/01/10,
Insured: FGIC ............. 357,700
500,000 State of California, G.O., Series A39,
5.250%, 06/30/00,
Insured: FSA .............. 500,000
--------------
857,700
--------------
FLORIDA - 1.25%
200,000 St. Lucie County PCR, Florida
Power and Light Co. Project,
5.800%, 01/01/26 (A) ...... 200,000
--------------
GEORGIA - 5.04%
330,000 Atlanta Water and Waste Revenue,
Series A, 5.000%, 11/01/09,
Insured: FGIC ............. 323,522
250,000 State of Georgia, Series A, G.O.
6.100%, 03/01/05 .......... 261,797
200,000 State of Georgia, Series D, G.O.
6.700%, 08/01/09 .......... 222,814
--------------
808,133
--------------
ILLINOIS - 9.45%
500,000 Chicago Board of Education,
School Reform Board,
Series A, G.O., 5.250%,
12/01/21, Insured: FGIC ... 463,165
500,000 Evanston, G.O.,
Prerefunded 12/01/02,
6.100%, 12/01/09 (C) ...... 515,700
500,000 Metropolitan Pier & Expansion
Authority, Dedicated State Tax
Revenue, Refunding, Series A
5.514%, 12/15/11,
Insured: MBIA(B): ......... 262,135
MARKET
PAR VALUE VALUE
----------- --------
ILLINOIS (CONTINUED)
$ 625,000 Northern Illinois University
Revenue, Auxilary Facilities
System Revenue
5.703%, 10/01/14,
Insured: FGIC (B) ......... $ 273,969
--------------
1,514,969
--------------
INDIANA - 3.19%
500,000 Indianapolis Public Improvement
Revenue, Series B
6.000%, 01/10/20 .......... 512,185
--------------
IOWA - 2.40%
395,000 Iowa Financial Authority
Revenue, Catholic Health
Initiatives, Series A
6.000%, 12/01/18 .......... 383,995
--------------
KENTUCKY - 4.42%
350,000 Jefferson County, Series C, G.O.
5.375%, 05/15/03 .......... 352,429
350,000 Kentucky State Turnpike Authority
Economic Development
Revenue, Revitalization Projects,
5.700%, 01/01/03 .......... 355,554
--------------
707,983
--------------
MICHIGAN - 1.54%
250,000 Michigan State Trunk Line
Revenue, Series A
5.500%, 11/01/16 .......... 247,195
--------------
MISSISSIPPI - 2.27%
350,000 State of Mississippi, Capital
Improvements Issue, Series I,
G.O., 5.750%, 11/01/09 (C) 363,629
--------------
NEBRASKA - 3.90%
200,000 American Public Energy Agency
Revenue, Nebraska Public Gas
Agency Project, Series A
4.250%, 06/01/06,
Insured: AMBAC ............ 182,398
250,000 American Public Energy Agency
Revenue, Nebraska Public Gas
Agency Project, Series C
4.300%, 03/01/11,
Insured: AMBAC ............ 211,215
250,000 Nebraska Public Power District
Revenue, Series A
5.000%, 01/01/15,
Insured: MBIA ............. 231,915
--------------
625,528
--------------
NEVADA - 2.33%
350,000 Clark County, Nevada School
District, G.O.,
Prerefunded 12/15/04,
6.400%, 06/15/06,
Insured: FGIC ............. 372,925
--------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
38
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
PAR VALUE VALUE
----------- --------
NEW HAMPSHIRE - 1.50%
$ 250,000 New Hampshire State Housing
Financial Authority Single
Family Revenue, Series B
4.850%, 07/01/08 .......... $ 240,480
--------------
NEW YORK - 7.75%
300,000 Municipal Assistance Corp. for
NYC Revenue, Series O
5.250%, 07/01/08 .......... 301,263
250,000 New York City Municipal Water
Financial Authority, Water and
Sewer System Revenue, Series A
5.000%, 06/15/27 .......... 212,940
250,000 New York State, Commissioner
General Services Executive
Dept., Certificate Participation
4.250%, 09/01/01 .......... 247,745
480,000 New York State Dormitory
Authority Revenue, Series C
5.100%, 05/15/03 .......... 480,994
--------------
1,242,942
--------------
NORTH CAROLINA - 1.71%
300,000 Durham, G.O.
4.700%, 04/01/14 .......... 274,092
--------------
240,000 OKLAHOMA - 1.54%
Oklahoma City, G.O.
5.550%, 08/01/11 .......... 246,802
--------------
PENNSYLVANIA - 6.30%
250,000 Beaver County Industrial
Development Authority, PCR,
Cleveland Electric Project
4.600%, 10/01/30 (A) ...... 238,125
500,000 Pennsylvania Intergovernmental
Cooperative Authority, Special
Tax Revenue, City of Philadelphia
Funding Program, Escrowed
to Maturity, 6.000%, 06/15/02,
Insured: FGIC ............. 508,780
260,000 Philadelphia School District,
Series B, G.O.,
5.300%, 07/01/04
Insured: AMBAC ............ 262,488
--------------
1,009,393
--------------
TEXAS - 8.63%
245,000 Denton Independent School
District Refunding, G.O.
5.000%, 02/15/12 .......... 237,030
200,000 Humble Independent School
District Refunding,
Series II, G.O.
5.500%, 02/15/10 .......... 203,086
MARKET
PAR VALUE VALUE
----------- --------
TEXAS (CONTINUED)
$ 250,000 Lubbock, G.O.
4.550%, 02/15/12 .......... $ 223,963
210,000 Tarrant County Health Facilities
Development Corp., Health
System Revenue, Series A
5.500%, 02/15/05,
Insured: MBIA ............. 212,583
500,000 Texas Municipal Power Agency
Revenue, Series E
5.500%, 09/01/10,
Insured: MBIA ............. 508,045
--------------
1,384,707
--------------
UTAH - 6.06%
300,000 Intermountain Power Agency,
Power Supply Revenue, Series E
6.250%, 07/01/07,
Insured: FSA .............. 317,808
350,000 Toole County, Utah Hazardous
Waste Treatment Revenue,
Union Pacific Project
5.700%, 11/01/26 .......... 299,208
350,000 Utah State Building Ownership
Authority Lease Revenue,
Series A State Facilities Master
Lease PG-C, 5.500%, 05/15/11,
Insured: FSA .............. 355,054
--------------
972,070
--------------
VIRGINIA - 1.50%
250,000 Virginia State Housing Develop-
ment Revenue Authority
Commonwealth Mortgage,
Series H, 4.750%, 07/01/07 240,853
--------------
WASHINGTON - 5.06%
475,000 King County, Series A, G.O.
5.800%, 01/01/04 (C) ...... 487,174
320,000 State of Washington, G.O.
Motor Vehicle Fuel,
Series R-93C
5.375%, 09/01/07 .......... 324,624
--------------
811,798
--------------
WISCONSIN - 4.80%
250,000 Fond Du Lac School District, G.O.
4.500%, 04/01/08,
Insured: FGIC ............. 232,508
250,000 State Of Wisconsin, Series A, G.O.
5.750%, 05/01/04 .......... 256,598
300,000 Wisconsin Housing and Economic
Development Authority, Home
Ownership Revenue, Series A
5.375%, 09/01/17 .......... 281,472
--------------
770,578
--------------
TOTAL MUNICIPAL BONDS ........ 15,231,276
--------------
(Cost $15,580,687)
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
39
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
MARKET
SHARES VALUE
-------- --------
INVESTMENT COMPANIES - 6.63%
435,000 Goldman Sachs Tax Exempt
Fund ...................... $ 435,000
628,773 Provident Money Market ....... 628,773
--------------
TOTAL INVESTMENT COMPANIES ... 1,063,773
--------------
(Cost $1,063,773)
TOTAL INVESTMENTS - 101.62% ................ 16,295,049
--------------
(Cost $16,644,460)**
LIABILITIES NET OF CASH
AND OTHER ASSETS - (1.62)% ............. (259,622)
--------------
NET ASSETS - 100.00% ....................... $ 16,035,427
==============
--------------------
** Aggregate cost for Federal income tax purposes is $16,644,460.
Gross unrealized appreciation .......... $ 83,160
Gross unrealized depreciation .......... (432,571)
--------------
Net unrealized depreciation ............ $ (349,411)
==============
--------------------
(A) Variable rate bond. The interest rate shown reflects the rate in
effect at April 30, 2000.
(B) Zero coupon bond. Rate shown reflects effective yield to maturity at
time of purchase.
(C) Standard & Poor's (S&P) credit ratings are used in the absence of a
rating by Moody's Investors, Inc.
AMBAC American Municipal Board Assurance Corp.
FGIC Federal Guaranty Insurance Corp.
FSA Fund Service Associates
G.O. General Obligation
MBIA Municipal Bond Insurance Corp.
PCR Pollution Control Revenue
PORTFOLIO COMPOSITION (MOODY'S RATINGS)
Investment Companies ................................. 7%
Corporate Notes and Bonds:
Aaa .................................................. 45%
Aa ................................................... 35%
A .................................................... 6%
Baa .................................................. 3%
Ba ................................................... 1%
NR ................................................... 3%
---
100%
===
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
40
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MONEY MARKET FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
AMORTIZED
PAR VALUE VALUE
----------- --------
COMMERCIAL PAPER - 89.90%
$ 6,300,000 GTE Corp.
6.080%, 05/01/00 (A) $ 6,300,000
5,000,000 Norwest Financial, Inc.
6.058%, 05/01/00 5,000,000
5,000,000 Prudential Funding Corp.
6.035%, 05/01/00 5,000,000
5,000,000 American General Finance
Corp. 6.077%, 05/02/00 5,000,000
4,900,000 John Deere Capital Corp.
6.035%, 05/02/00 4,900,000
6,000,000 Transamerica Financial Group,
Inc. 6.070%, 05/02/00 (A) 5,998,988
5,000,000 General Electric Capital Corp.
6.087%, 05/03/00 5,000,000
6,000,000 Transamerica Financial Group,
Inc. 6.070%, 05/03/00 (A) 5,997,977
5,000,000 Ford Motor Credit Corp.
6.037%, 05/04/00 5,000,000
5,000,000 Prudential Funding Corp.
6.038%, 05/04/00 5,000,000
6,000,000 Sears Roebuck Acceptance Corp.
6.168%, 05/04/00 6,000,000
5,000,000 Ford Motor Credit Corp.
6.038%, 05/05/00 5,000,000
7,300,000 General Motors Acceptance Corp.
6.098%, 05/05/00 7,300,000
6,000,000 Transamerica Financial Group,
Inc. 6.070%, 05/05/00(A) 5,995,953
4,000,000 AON Corp.
6.100%, 05/08/00 (A) 3,995,256
5,000,000 Canadian Imperial Bank of
Commerce 6.060%, 05/08/00 5,000,000
5,000,000 Duke Energy Corp.
6.010%, 05/08/00 (A) 4,994,157
4,600,000 Canadian Imperial Bank of
Commerce 6.030%, 05/09/00 4,600,000
5,000,000 CIT Group Holdings
6.077%, 05/09/00 5,000,000
6,600,000 Heller Financial, Inc.
6.172%, 05/09/00 6,600,000
5,000,000 Canadian Imperial Bank of
Commerce 6.070%, 05/10/00 5,000,000
5,000,000 CIT Group Holdings
6.078%, 05/10/00 5,000,000
6,000,000 Citigroup, Inc.
6.043%, 05/10/00 6,000,000
4,200,000 CIT Group Holdings
6.056%, 05/11/00 4,200,000
6,000,000 Eaton Corp.
6.060%, 05/11/00 (A) 5,989,900
6,500,000 Sears Roebuck Acceptance Corp.
6.118%, 05/11/00 6,500,000
5,000,000 CIT Group Holdings
6.057%, 05/12/00 5,000,000
6,800,000 Citigroup, Inc.
6.045%, 05/12/00 6,800,000
5,000,000 Ford Motor Credit Corp.
6.030%, 05/12/00 5,000,000
AMORTIZED
PAR VALUE VALUE
----------- --------
$ 5,700,000 Baxter International, Inc.
6.020%, 05/15/00 (A) $ 5,686,656
5,000,000 Canadian Imperial Bank of
Commerce 6.030%, 05/15/00 5,000,000
6,400,000 GTE Corp.
6.050%, 05/16/00 (A) 6,383,867
7,000,000 United Technologies Corp.
6.000%, 05/16/00 (A) 6,982,500
7,000,000 American Express Credit Corp.
6.035%, 05/17/00 7,000,000
6,000,000 United Technologies Corp.
6.050%, 05/17/00 (A) 5,983,867
5,800,000 Baxter International, Inc.
6.070%, 05/18/00 (A) 5,783,375
8,000,000 Daimler Chrysler North
American Holdings
6.045%, 05/18/00 8,000,000
3,000,000 Eaton Corp.
6.050%, 05/19/00 (A) 2,990,925
7,500,000 Sears Roebuck Acceptance Corp.
6.121%, 05/22/00 7,500,000
6,550,000 Toyota Motor Credit Corp.
6.050%, 05/22/00 (A) 6,526,884
8,000,000 Baxter International, Inc.
6.060%, 05/23/00 (A) 7,970,373
5,500,000 John Deere Capital Corp.
6.073%, 05/23/00 5,500,000
7,000,000 Daimler Chrysler North
American Holdings
6.054%, 05/24/00 7,000,000
6,600,000 Goldman Sachs & Co., Inc.
6.180%, 05/24/00 (A) 6,573,941
3,000,000 GTE Corp.
6.130%, 05/24/00 (A) 2,988,251
4,000,000 Goldman Sachs & Co., Inc.
6.080%, 05/25/00 (A) 3,983,787
6,000,000 Hertz Corp.
6.052%, 05/25/00 6,000,000
3,000,000 GTE Corp.
6.080%, 05/26/00 (A) 2,987,333
15,000,000 AON Corp.
6.080%, 05/31/00 (A) 14,924,000
5,000,000 American General Finance Corp.
6.106%, 06/01/00 5,000,000
9,000,000 Heller Financial, Inc.
6.149%, 06/05/00 9,000,000
General Electric Capital Corp.
7,000,000 6.126%, 06/08/00 7,000,000
7,000,000 6.127%, 06/09/00 7,000,000
SBC Communications, Inc.
6,000,000 6.100%, 06/12/00 (A) 5,957,300
6,000,000 6.100%, 06/13/00 (A) 5,956,283
3,600,000 Heller Finacial ,Inc.
6.271%, 06/14/00 3,600,000
SBC Communications, Inc.
6,000,000 6.100%, 06/15/00 (A) 5,954,250
7,000,000 General Motors Acceptance Corp.
6.194%, 06/16/00 7,000,000
4,000,000 6.197%, 06/19/00 4,000,000
8,700,000 Goldman Sachs & Co., Inc.
6.110%, 06/19/00 (A) 8,627,647
--------------
TOTAL COMMERCIAL PAPER 352,033,470
--------------
(Cost $352,033,470)
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
41
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MONEY MARKET FUND APRIL 30, 2000
SCHEDULE OF INVESTMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
AMORTIZED
PAR VALUE VALUE
----------- --------
GIC WITHIN FUNDING AGREEMENT - 2.55%
$10,000,000 Allstate Life Funding Agreement
GIC 6.137%, 12/01/00 ...... $ 10,000,000
--------------
TOTAL GIC WITHIN FUNDING
AGREEMENT .................... 10,000,000
--------------
(Cost $10,000,000)
SHARES
--------
INVESTMENT COMPANY - 4.86%
19,032,000 Provident Institutional Fund 19,032,000
--------------
TOTAL INVESTMENT COMPANY ..... 19,032,000
--------------
(Cost $19,032,000)
TOTAL INVESTMENTS - 97.31% ................. 381,065,470
--------------
(Cost $381,065,470)*
NET OTHER ASSETS AND LIABILITIES - 2.69% 10,522,991
--------------
NET ASSETS - 100.00% ....................... $ 391,588,461
==============
--------------------
* At April 30, 2000, cost is identical for book and Federal income tax
purposes.
(A) Annualized yield at time of purchase.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
42
<PAGE>
This page intentionally left blank.
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
STATEMENT OF ASSETS AND LIABILITIES (UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/MONTAG ALLEGHANY/CHICAGO
& CALDWELL GROWTH TRUST GROWTH & ALLEGHANY/CHICAGO
FUND INCOME FUND TRUST TALON FUND
------------------- ----------------- ------------------
ASSETS:
<S> <C> <C> <C>
Investments:
Investments at cost .................................. $ 2,716,091,654 $ 312,172,810 $ 16,198,522
Repurchase agreements ................................ -- 29,294,000 --
Net unrealized appreciation (depreciation) ........... 494,154,393 225,856,595 2,651,939
------------------- ---------------- ---------------
Total investments at value ........................ 3,210,246,047 567,323,405 18,850,461
Cash ........................................................ -- 488 3,436
Foreign currency (cost $46,208 and $38,041) ................. -- -- --
Receivables:
Dividends and interest ............................... 1,628,691 107,478 1,767
Dividends reclaim .................................... -- -- --
Fund shares sold ..................................... 3,736,736 4,203,813 4,937
Investments and foreign currency sold ................ -- -- 450,778
Deferred organization costs ................................. -- -- --
Other assets ................................................ 54,743 34,308 202
Variation on margin ......................................... -- -- --
------------------- ---------------- ---------------
Total assets ...................................... 3,215,666,217 571,669,492 19,311,581
------------------- ---------------- ---------------
LIABILITIES:
Payables:
Investments and foreign currency purchased ........... 5,628,672 3,386,555 437,424
Fund shares redeemed ................................. 16,373,692 375,859 3,993
Due to Adviser, net .................................. 1,713,785 313,710 9,196
Distribution fee ..................................... -- 26,647 890
Trustees fees ........................................ 20,650 3,242 104
Accrued expenses and other payables ......................... 329,374 51,311 19,149
Depreciation on forward foreign currency contracts .......... -- -- --
------------------- ---------------- ---------------
Total liabilities ................................. 24,066,173 4,157,324 470,756
------------------- ---------------- ---------------
NET ASSETS .................................................. $ 3,191,600,044 $ 567,512,168 $ 18,840,825
=================== ================ ===============
NET ASSETS CONSIST OF:
Capital paid-in ......................................... $ 2,363,241,374 $ 307,933,026 $ 12,581,190
Accumulated undistributed (distribution in excess of)
net investment income (loss) ......................... (1,116,251) (295,629) (52,353)
Accumulated net realized gain (loss) on investments
and foreign currency transactions .................... 335,320,528 34,018,176 3,660,049
Net unrealized appreciation (depreciation) on investments
and translation of assets and liabilities in foreign
currency ............................................. 494,154,393 225,856,595 2,651,939
------------------- ---------------- ---------------
TOTAL NET ASSETS ..................................... $ 3,191,600,044 $ 567,512,168 $ 18,840,825
=================== ================ ===============
CLASS N:
Net Assets .............................................. $ 1,617,881,980 $ 567,512,168 $ 18,840,825
Shares of beneficial interest outstanding ............... 48,624,844 19,423,718 1,091,205
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) ...................... $ 33.27 $ 29.22 $ 17.27
=================== ================ ===============
CLASS I:
Net Assets .............................................. $ 1,573,718,064 N/A N/A
Shares of beneficial interest outstanding ............... 46,759,637 N/A N/A
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) ...................... $ 33.66 N/A N/A
=================== ================ ===============
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
44
<PAGE>
ALLEGHANY FUNDS
-------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/CHICAGO ALLEGHANY/VEREDUS ALLEGHANY/BLAIRLOGIE ALLEGHANY/BLAIRLOGIE
TRUST SMALL CAP AGGRESSIVE INTERNATIONAL EMERGING MARKETS
VALUE FUND GROWTH FUND DEVELOPED FUND FUND
------------------ ----------------- --------------------- -------------------
ASSETS:
<S> <C> <C> <C> <C>
Investments:
Investments at cost ...................... $ 46,841,393 $ 144,711,520 $ 57,573,901 $ 15,246,958
Repurchase agreements .................... 1,870,000 21,206,256 -- --
Net unrealized appreciation
(depreciation) ........................ (1,384,286) 3,873,213 6,877,989 2,318,516
----------------- --------------- ----------------- -----------------
Total investments at value ............ 47,327,107 169,790,989 64,451,890 17,565,474
Cash ............................................ 838 -- 264,738 3,689
Foreign currency (cost $46,208 and $38,041) ..... -- -- 45,208 36,188
Receivables:
Dividends and interest ................... 28,847 14,010 178,677 77,718
Dividends reclaim ........................ -- -- 106,978 --
Fund shares sold ......................... 11,935 731,373 34,605 1,746
Investments and foreign currency sold .... 3,601,128 5,246,376 5,909,291 947,624
Deferred organization costs ..................... -- 15,234 -- --
Other assets .................................... 35,480 9,968 1,094 226
Variation on margin ............................. -- -- 38,077 --
----------------- --------------- ----------------- -----------------
Total assets .......................... 51,005,335 175,807,950 71,030,558 18,632,665
----------------- --------------- ----------------- -----------------
LIABILITIES:
Payables:
Investments and foreign currency
purchased ........................... 2,601,144 10,396,999 435,922 44,199
Fund shares redeemed ..................... 21,082 201,949 4,373,788 1,003,725
Due to Adviser, net ...................... 36,366 124,013 45,442 9,512
Distribution fee ......................... 2,291 7,540 336 106
Trustees fees ............................ 284 965 518 121
Accrued expenses and other payables ............. 4,266 27,686 194,779 162,207
Depreciation on forward foreign
currency contracts ....................... -- -- 1,140 425
----------------- --------------- ----------------- -----------------
Total liabilities ..................... 2,665,433 10,759,152 5,051,925 1,220,295
----------------- --------------- ----------------- -----------------
NET ASSETS ...................................... $ 48,339,902 $ 165,048,798 $ 65,978,633 $ 17,412,370
================= =============== ================= =================
NET ASSETS CONSIST OF:
Capital paid-in ............................. $ 46,974,265 $ 116,955,904 $ 45,646,122 $ 30,931,309
Accumulated undistributed (distribution
in excess of) net investment
income (loss) ............................ 40,454 (558,599) (21,063) 40,733
Accumulated net realized gain (loss)
on investments and foreign currency
transactions ............................. 2,709,469 44,778,280 13,526,381 (15,866,656)
Net unrealized appreciation (depreciation)
on investments and translation of
assets and liabilities in foreign
currency ................................. (1,384,286) 3,873,213 6,827,193 2,306,984
----------------- --------------- ----------------- -----------------
TOTAL NET ASSETS ......................... $ 48,339,902 $ 165,048,798 $ 65,978,633 $ 17,412,370
================= =============== ================= =================
CLASS N:
Net Assets .................................. $ 48,339,902 $ 165,048,798 $ 7,047,744 $ 2,257,336
Shares of beneficial interest outstanding ... 4,795,968 7,055,069 550,646 180,372
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) .......... $ 10.08 $ 23.39 $ 12.80 $ 12.51
================= =============== ================= =================
CLASS I:
Net Assets .................................. N/A N/A $ 58,930,889 $ 15,155,034
Shares of beneficial interest outstanding ... N/A N/A 4,596,904 1,208,136
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) .......... N/A N/A $ 12.82 $ 12.54
================= =============== ================= =================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
45
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
STATEMENT OF ASSETS AND LIABILITIES - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/MONTAG ALLEGHANY/
& CALDWELL BALANCED CHICAGO TRUST
FUND BALANCED FUND
----------------- ------------------
ASSETS:
<S> <C> <C>
Investments:
Investments at cost ...................................................... $ 291,854,353 $ 220,856,240
Repurchase agreements .................................................... 23,858,000 5,570,000
Net unrealized appreciation (depreciation) ............................... 26,054,089 81,689,677
---------------- ---------------
Total investments at value ............................................ 341,766,442 308,115,917
Cash ............................................................................ -- 512
Receivables:
Dividends and interest ................................................... 1,839,897 1,576,836
Fund shares sold ......................................................... 11,199,612 2,406,140
Investments sold ......................................................... -- 2,792,848
Due from Adviser, net .................................................... -- --
Deferred organization costs ..................................................... -- 533
Other assets .................................................................... 2,966 14,542
---------------- ---------------
Total assets .......................................................... 354,808,917 314,907,328
---------------- ---------------
LIABILITIES:
Payables:
Dividend distribution .................................................... 596 --
Investments purchased .................................................... 442,179 2,838,907
Fund shares redeemed ..................................................... 513,544 370,816
Due to Adviser, net ...................................................... 214,429 175,873
Distribution fee ......................................................... 7,721 14,731
Trustees fees ............................................................ 2,149 1,864
Accrued expenses and other payables ............................................. 71,430 46,802
---------------- ---------------
Total liabilities ..................................................... 1,252,048 3,448,993
---------------- ---------------
NET ASSETS ...................................................................... $ 353,556,869 $ 311,458,335
================ ===============
NET ASSETS CONSIST OF:
Capital paid-in ............................................................. $ 308,740,858 $ 214,045,910
Accumulated undistributed net investment income ............................. 914,731 936,114
Accumulated net realized gain (loss) on investments ......................... 17,847,191 14,786,634
Net unrealized appreciation (depreciation) on investments ................... 26,054,089 81,689,677
---------------- ---------------
TOTAL NET ASSETS ......................................................... $ 353,556,869 $ 311,458,335
================ ===============
CLASS N:
Net Assets .................................................................. $ 167,747,356 $ 311,458,335
Shares of beneficial interest outstanding ................................... 8,747,613 22,926,712
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) .......................................... $ 19.18 $ 13.58
================ ===============
CLASS I:
Net Assets .................................................................. $ 185,809,513 N/A
Shares of beneficial interest outstanding ................................... 9,680,003 N/A
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) .......................................... $ 19.20 N/A
================ ===============
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
46
<PAGE>
ALLEGHANY FUNDS
-------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/CHICAGO ALLEGHANY/CHICAGO
ALLEGHANY/CHICAGO TRUST MUNICIPAL TRUST MONEY
TRUST BOND FUND BOND FUND MARKET FUND
----------------- --------------- -----------------
ASSETS:
<S> <C> <C> <C>
Investments:
Investments at cost ................................... $ 135,637,076 $ 16,644,460 $ 381,065,470
Repurchase agreements ................................. 6,843,000 -- --
Net unrealized appreciation (depreciation) ............ (3,993,216) (349,411) --
----------------- --------------- -----------------
Total investments at value ......................... 138,486,860 16,295,049 381,065,470
Cash ......................................................... 108 212 930
Receivables:
Dividends and interest ................................ 1,828,617 260,870 872,870
Fund shares sold ...................................... 264,804 40,030 11,671,672
Investments sold ...................................... -- -- --
Due from Adviser, net ................................. -- 6,232 --
Deferred organization costs .................................. -- -- --
Other assets ................................................. 5,457 1,379 11,727
----------------- --------------- -----------------
Total assets ....................................... 140,585,846 16,603,772 393,622,669
----------------- --------------- -----------------
LIABILITIES:
Payables:
Dividend distribution ................................. -- 36,898 1,776,789
Investments purchased ................................. -- 521,518 --
Fund shares redeemed .................................. 238,450 -- 78,455
Due to Adviser, net ................................... 40,355 -- 129,457
Distribution fee ...................................... 6,730 307 --
Trustees fees ......................................... 759 100 2,732
Accrued expenses and other payables .......................... 11,522 9,522 46,775
----------------- --------------- -----------------
Total liabilities .................................. 297,816 568,345 2,034,208
----------------- --------------- -----------------
NET ASSETS ................................................... $ 140,288,030 $ 16,035,427 $ 391,588,461
================= =============== =================
NET ASSETS CONSIST OF:
Capital paid-in .......................................... $ 146,015,338 $ 16,674,573 $ 391,588,461
Accumulated undistributed net investment income .......... 443,316 -- --
Accumulated net realized gain (loss) on investments ...... (2,177,408) (289,735) --
Net unrealized appreciation (depreciation)
on investments......................................... (3,993,216) (349,411) --
----------------- --------------- -----------------
TOTAL NET ASSETS ...................................... $ 140,288,030 $ 16,035,427 $ 391,588,461
================= =============== =================
CLASS N:
Net Assets ............................................... $ 140,288,030 $ 16,035,427 $ 391,588,461
Shares of beneficial interest outstanding ................ 14,641,019 1,654,930 391,588,461
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) ....................... $ 9.58 $ 9.69 $ 1.00
================= =============== =================
CLASS I:
Net Assets ............................................... N/A N/A N/A
Shares of beneficial interest outstanding ................ N/A N/A N/A
NET ASSET VALUE
Offering and redemption price per share
(Net Assets/Shares Outstanding) ....................... N/A N/A N/A
================= =============== =================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
47
<PAGE>
ALLEGHANY FUNDS
-------------------
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
STATEMENT OF OPERATIONS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/MONTAG ALLEGHANY/CHICAGO ALLEGHANY/CHICAGO
& CALDWELL GROWTH TRUST GROWTH & ALLEGHANY/CHICAGO TRUST SMALL CAP
FUND INCOME FUND TRUST TALON FUND VALUE FUND
------------------- ----------------- ---------------- -----------------
INVESTMENT INCOME:
<S> <C> <C> <C> <C>
Dividends ............................. $ 12,983,082 $ 1,655,794 $ 60,644 $ 356,424
Less foreign taxes .................... -- -- (1,035) --
Interest .............................. 12,242 865,866 7,387 53,041
------------------- ---------------- --------------- ----------------
Total investment income ............. 12,995,324 2,521,660 66,996 409,465
------------------- ---------------- --------------- ----------------
EXPENSES:
Investment advisory fees .............. 10,337,892 1,843,030 73,443 222,734
Distribution expenses ................. 2,085,036 658,225 22,951 55,688
Transfer agent fees ................... 548,344 110,646 14,242 10,658
Administration fees ................... 865,539 144,060 5,871 13,280
Registration expenses ................. 80,159 7,493 4,500 7,914
Custodian fees ........................ 11,376 11,954 5,913 8,166
Professional fees ..................... 36,064 12,683 7,682 6,653
Amortization of organization costs .... -- -- -- --
Reports to shareholder expense ........ 80,978 14,530 2,470 3,525
Trustees fees ......................... 60,558 9,924 335 816
Other expenses ........................ 5,629 4,744 1,200 2,327
------------------- ---------------- --------------- ----------------
Total operating expenses ............ 14,111,575 2,817,289 138,607 331,761
------------------- ---------------- --------------- ----------------
Expenses waived/reimbursed .......... -- -- (19,258) (19,925)
------------------- ---------------- --------------- ----------------
Net operating expenses .............. 14,111,575 2,817,289 119,349 311,836
------------------- ---------------- --------------- ----------------
Bank charges .......................... -- -- -- --
------------------- ---------------- --------------- ----------------
Net expenses ........................ 14,111,575 2,817,289 119,349 311,836
------------------- ---------------- --------------- ----------------
NET INVESTMENT INCOME (LOSS) ............... (1,116,251) (295,629) (52,353) 97,629
------------------- ---------------- --------------- ----------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments ...... 335,322,659 34,018,559 3,660,214 3,993,853
Net realized gain (loss) on
futures contracts ................... -- -- -- --
Net realized gain (loss) on foreign
currency transactions ............... -- -- -- --
Net change in unrealized appreciation
(depreciation) on investments ....... (178,348,593) 32,113,746 1,196,895 463,478
Net change in unrealized depreciation
on futures contracts ................ -- -- -- --
Net change in unrealized appreciation
(depreciation) on translation of
assets and liabilities denominated
in foreign currency ................. -- -- -- --
------------------- ---------------- --------------- ----------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS ................. 156,974,066 66,132,305 4,857,109 4,457,331
------------------- ---------------- --------------- ----------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS ..................... $ 155,857,815 $ 65,836,676 $ 4,804,756 $ 4,554,960
=================== ================ =============== ================
</TABLE>
-------------------
(a) Blairlogie International Developed Fund commenced operations on June 8, 1993
as a separate investment portfolio (the "Predecessor Fund") of PIMCO Funds.
Effective April 30, 1999, the Predecessor Fund was reorganized as a new
portfolio of the Alleghany Funds. (See Note A)
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
48
<PAGE>
ALLEGHANY FUNDS
-------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/BLAIRLOGIE ALLEGHANY/BLAIRLOGIE ALLEGHANY/BLAIRLOGIE
INTERNATIONAL INTERNATIONAL INTERNATIONAL
ALLEGHANY/VEREDUS DEVELOPED FUND DEVELOPED FUND DEVELOPED FUND
AGGRESIVE SIX MONTHS ENDED SIX MONTHS ENDED TEN MONTHS ENDED
GROWTH FUND APRIL 30, 2000(A) OCTOBER 31, 1999(A) APRIL 30, 1999(A)
------------------ ------------------ ------------------ -------------------
INVESTMENT INCOME:
<S> <C> <C> <C> <C>
Dividends ............................. $ 10,072 $ 535,906 $ 1,394,237 $ 1,181,911
Less foreign taxes .................... -- (52,381) (165,999) (150,859)
Interest .............................. 269,403 84,308 17,573 187,723
--------------- ------------------ ----------------- ------------------
Total investment income ............. 279,475 567,833 1,245,811 1,218,775
--------------- ------------------ ----------------- ------------------
EXPENSES:
Investment advisory fees .............. 598,611 410,196 439,792 611,052
Distribution expenses ................. 149,653 9,078 9,005 82,795
Transfer agent fees ................... 33,480 10,676 9,648 --
Administration fees ................... 33,919 41,377 40,755 522,631
Registration expenses ................. 16,602 15,000 12,500 --
Custodian fees ........................ 12,223 62,742 64,399 --
Professional fees ..................... 7,351 7,210 16,884 --
Amortization of organization costs .... 2,401 -- -- --
Reports to shareholder expense ........ 9,814 4,826 5,170 --
Trustees fees ......................... 2,221 1,848 1,748 9,489
Other expenses ........................ 2,809 254 7,827 46,231
--------------- ------------------ ----------------- ------------------
Total operating expenses ............ 869,084 563,207 607,728 1,272,198
--------------- ------------------ ----------------- ------------------
Expenses waived/reimbursed .......... (31,010) (23,268) (29,647) --
--------------- ------------------ ----------------- ------------------
Net operating expenses .............. 838,074 539,939 578,081 1,272,198
--------------- ------------------ ----------------- ------------------
Bank charges .......................... -- 41,880 27,103 --
--------------- ------------------ ----------------- ------------------
Net expenses ........................ 838,074 581,819 605,184 1,272,198
--------------- ------------------ ----------------- ------------------
NET INVESTMENT INCOME (LOSS) ............... (558,599) (13,986) 640,627 (53,423)
--------------- ------------------ ----------------- ------------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investments ...... 45,583,801 13,898,326 8,564,739 14,045,047
Net realized gain (loss) on
futures contracts ................... -- (41,286) -- 311,306
Net realized gain (loss) on foreign
currency transactions ............... -- (243,778) 81,307 (1,149,976)
Net change in unrealized appreciation
(depreciation) on investments ....... (6,572,090) (7,440,220) (3,669,570) (9,468,547)
Net change in unrealized depreciation
on futures contracts ................ -- -- -- (117,229)
Net change in unrealized appreciation
(depreciation) on translation of
assets and liabilities denominated
in foreign currency ................. -- (54,412) 13,316 324,491
--------------- ------------------ ----------------- ------------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS ................. 39,011,711 6,118,630 4,989,792 3,945,092
--------------- ------------------ ----------------- ------------------
NET INCREASE IN NET ASSETS
FROM OPERATIONS ..................... $ 38,453,112 $ 6,104,644 $ 5,630,419 $ 3,891,669
=============== ================== ================= ==================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
49
<PAGE>
ALLEGHANY FUNDS
-------------------
FOR THE SIX MONTHS ENDED APRIL 30, 2000 (UNAUDITED)
STATEMENT OF OPERATIONS - CONTINUED
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/BLAIRLOGIE ALLEGHANY/BLAIRLOGIE ALLEGHANY/BLAIRLOGIE
EMERGING MARKETS EMERGING MARKETS EMERGING MARKETS
FUND FUND FUND ALLEGHANY/MONTAG
SIX MONTHS ENDED SIX MONTHS ENDED TEN MONTHS ENDED CALDWELL BALANCED
APRIL 30, 2000(A) OCTOBER 31, 1999(A) APRIL 30, 1999(A) FUND
------------------- ----------------- ---------------- -----------------
INVESTMENT INCOME:
<S> <C> <C> <C> <C>
Dividends ................................ $ 205,907 $ 233,553 $ 436,911 $ 590,476
Less foreign taxes ....................... (28,485) (11,120) (48,876) --
Interest ................................. 17,711 12,597 34,267 3,823,388
------------------- ---------------- --------------- ----------------
Total investment income ................ 195,133 235,030 422,302 4,413,864
------------------- ---------------- --------------- ----------------
EXPENSES:
Investment advisory fees ................. 88,319 78,010 151,716 1,116,029
Distribution expenses .................... 2,954 2,233 11,205 202,763
Transfer agent fees ...................... 5,436 4,248 -- 42,594
Administration fees ...................... 20,095 17,137 91,107 84,209
Registration expenses .................... 15,499 11,000 -- 38,341
Custodian fees ........................... 34,221 38,819 -- 11,810
Professional fees ........................ 7,306 16,157 -- 10,920
Amortization of organization costs ....... -- -- -- --
Reports to shareholder expense ........... 1,039 917 -- 5,963
Trustees fees ............................ 388 309 1,739 5,581
Other expenses ........................... 5,762 829 12,773 2,181
------------------- ---------------- --------------- ----------------
Total operating expenses ............... 181,019 169,659 268,540 1,520,391
------------------- ---------------- --------------- ----------------
Expenses waived/reimbursed ............. (37,790) (43,536) -- --
------------------- ---------------- --------------- ----------------
Net operating expenses ................. 143,229 126,123 268,540 1,520,391
------------------- ---------------- --------------- ----------------
Bank charges ............................. 2,164 7,229 -- --
------------------- ---------------- --------------- ----------------
Net expenses ........................... 145,393 133,352 268,540 1,520,391
------------------- ---------------- --------------- ----------------
NET INVESTMENT INCOME ......................... 49,740 101,678 153,762 2,893,473
------------------- ---------------- --------------- ----------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on
investments ............................ 1,690,879 430,553 (4,719,790) 17,986,960
Net realized loss on foreign
currency transactions .................. (11,434) (55,545) (68,780) --
Net change in unrealized appreciation
(depreciation) on investments .......... 1,357,643 71,758 3,734,773 (7,005,031)
Net change in unrealized appreciation
on translation of assets and
liabilities denominated in
foreign currency ...................... 192 9,196 392 --
------------------- ---------------- --------------- ----------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS ............. 3,037,280 455,962 (1,053,405) 10,981,929
------------------- ---------------- --------------- ----------------
NET INCREASE (DECREASE) IN
NET ASSETS FROM OPERATIONS ............. $ 3,087,020 $ 557,640 $ (899,643) $ 13,875,402
=================== ================ =============== ================
</TABLE>
-------------------------
(a) Blairlogie Emerging Markets Fund commenced operations on June 1, 1993 as a
separate investment portfolio (the "Predecessor Fund") of PIMCO Funds.
Effective April 30, 1999, the Predecessor Fund was reorganized as a new
portfolio of the Alleghany Funds. (See Note A)
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
50
<PAGE>
ALLEGHANY FUNDS
-------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/CHICAGO ALLEGHANY/CHICAGO
ALLEGHANY/CHICAGO ALLEGHANY/CHICAGO TRUST MUNICIPAL TRUST MONEY MARKET
RUST BALANCED FUND TRUST BOND FUND BOND FUND FUND
------------------ ----------------- ------------------ ------------------
INVESTMENT INCOME:
<S> <C> <C> <C> <C>
Dividends ................................ $ 604,470 $ -- $ -- $ --
Less foreign taxes ....................... -- -- -- --
Interest ................................. 4,331,451 4,973,793 408,039 11,983,038
-------------- ---------------- --------------- ------------------
Total investment income ................ 4,935,921 4,973,793 408,039 11,983,038
-------------- ---------------- --------------- ------------------
EXPENSES:
Investment advisory fees ................. 1,047,594 372,174 50,008 816,688
Distribution expenses .................... 374,141 169,170 8,335 --
Transfer agent fees ...................... 16,433 16,774 9,403 30,019
Administration fees ...................... 87,508 41,325 8,103 110,750
Registration expenses .................... 6,929 7,097 4,433 18,867
Custodian fees ........................... 11,303 10,387 5,563 10,933
Professional fees ........................ 10,370 8,973 7,966 11,170
Amortization of organization costs ....... 699 -- -- --
Reports to shareholder expense ........... 10,338 5,037 2,094 15,322
Trustees fees ............................ 5,529 2,481 306 8,061
Other expenses ........................... 594 2,677 448 5,646
-------------- ---------------- --------------- ------------------
Total operating expenses ............... 1,571,438 636,095 96,659 1,027,456
-------------- ---------------- --------------- ------------------
Expenses waived/reimbursed ............. -- (111,990) (88,324) --
-------------- ---------------- --------------- ------------------
Net operating expenses ................. 1,571,438 524,105 8,335 1,027,456
-------------- ---------------- --------------- ------------------
Bank charges ............................. -- -- -- --
-------------- ---------------- --------------- ------------------
Net expenses ........................... 1,571,438 524,105 8,335 1,027,456
-------------- ---------------- --------------- ------------------
NET INVESTMENT INCOME ......................... 3,364,483 4,449,688 399,704 10,955,582
-------------- ---------------- --------------- ------------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on
investments ............................ 14,788,004 (1,725,763) (279,505) --
Net realized loss on foreign
currency transactions .................. -- -- -- --
Net change in unrealized appreciation
(depreciation) on investments .......... 6,037,585 (83,978) 248,658 --
Net change in unrealized appreciation
on translation of assets and
liabilities denominated in
foreign currency ...................... -- -- -- --
-------------- ---------------- --------------- ------------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS ............. 20,825,589 (1,809,741) (30,847) --
-------------- ---------------- --------------- ------------------
NET INCREASE (DECREASE) IN
NET ASSETS FROM OPERATIONS ............. $ 24,190,072 $ 2,639,947 $ 368,857 $ 10,955,582
============== ================ =============== ==================
</TABLE>
51
<PAGE>
ALLEGHANY FUNDS
-------------------
STATEMENT OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/MONTAG ALLEGHANY/CHICAGO
& CALDWELL GROWTH TRUST GROWTH &
FUND INCOME FUND
------------------------------------- ---------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
----------------- ----------------- --------------- --------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD ..... $ 2,982,468,577 $ 1,742,778,507 $ 490,188,782 $ 367,666,442
----------------- ----------------- --------------- --------------
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS:
Net investment income (loss) ...... (1,116,251) (639,463) (295,629) (1,141,812)
Net realized gain (loss) on
investments sold ............... 335,322,659 148,878,688 34,018,559 36,048,190
Net change in unrealized
appreciation (depreciation) on
investments and assets and
liabilities .................... (178,348,593) 416,154,751 32,113,746 69,358,356
----------------- ----------------- --------------- --------------
Net increase (decrease) in net
assets from operations ......... 155,857,815 564,393,976 65,836,676 104,264,734
----------------- ----------------- --------------- --------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................ -- -- -- --
Net realized gain on investments:
Class N ........................ (79,026,102) (35,583,495) (36,048,318) (23,278,710)
Class I ........................ (69,733,404) (28,418,102) -- --
----------------- ----------------- --------------- --------------
Total distributions ............ (148,759,506) (64,001,597) (36,048,318) (23,278,710)
----------------- ----------------- --------------- --------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares:
Class N ........................ 571,882,620 1,051,011,357 97,710,351 184,622,120
Class I ........................ 541,131,442 953,960,617 -- --
Issued to shareholders in
reinvestment of distributions:
Class N ........................ 72,385,785 33,017,124 35,118,050 22,904,776
Class I ........................ 63,293,452 25,234,975 -- --
Cost of shares repurchased:
Class N ........................ (641,884,251) (751,465,775) (85,293,373) (165,990,580)
Class I ........................ (404,775,890) (572,460,607) -- --
----------------- ----------------- --------------- --------------
Net increase (decrease) from
capital share transactions 202,033,158 739,297,691 47,535,028 41,536,316
----------------- ----------------- --------------- --------------
Total increase (decrease)
in net assets ............. 209,131,467 1,239,690,070 77,323,386 122,522,340
----------------- ----------------- --------------- --------------
NET ASSETS AT END OF PERIOD
(INCLUDING LINE A) ................ $ 3,191,600,044 $ 2,982,468,577 $ 567,512,168 $ 490,188,782
================= ================= =============== ==============
(A) Undistributed (overdistributed)
net investment income .......... $ (1,116,251) $ -- $ (295,629) $ --
================= ================= =============== ==============
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................... 17,118,550 33,562,499 3,454,538 7,050,057
Issued to shareholders
in reinvestment
of distributions ............ 2,140,542 1,195,841 1,299,232 1,005,045
Repurchased .................... (19,292,232) (24,010,343) (3,017,675) (6,314,269)
Class I:
Sold ........................... 15,971,482 30,617,406 -- --
Issued to shareholders
in reinvestment
of distributions ............ 1,836,069 903,059 -- --
Repurchased .................... (11,983,721) (18,295,778) -- --
----------------- ----------------- --------------- --------------
Net increase (decrease)
in shares outstanding .... 5,790,690 23,972,684 1,736,095 1,740,833
================= ================= =============== ==============
</TABLE>
---------------------------
(a) Alleghany/Chicago Trust SmallCap Value Fund commenced operations on November
10, 1998.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
52
<PAGE>
ALLEGHANY FUNDS
-------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/CHICAGO
ALLEGHANY/CHICAGO TRUST SMALLCAP
TRUST TALON FUND VALUE FUND
------------------------------------- -------------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED PERIOD ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999(A)
-------------- ---------------- ---------------- -----------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD ..... $ 17,586,038 $ 22,727,692 $ 42,478,264 $ 10
-------------- ---------------- ---------------- -----------------
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS:
Net investment income (loss) ...... (52,353) (61,638) 97,629 182,607
Net realized gain (loss) on
investments sold ............... 3,660,214 567,265 3,993,853 (1,284,384)
Net change in unrealized
appreciation (depreciation) on
investments and assets and
liabilities .................... 1,196,895 187,313 463,478 (1,847,764)
-------------- ---------------- ---------------- -----------------
Net increase (decrease) in net
assets from operations ......... 4,804,756 692,940 4,554,960 (2,949,541)
-------------- ---------------- ---------------- -----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................ -- (8,361) (203,715) (36,178)
Net realized gain on investments:
Class N ........................ (195,413) -- -- --
Class I ........................ -- -- -- --
-------------- ---------------- ---------------- -----------------
Total distributions ............ (195,413) (8,361) (203,715) (36,178)
-------------- ---------------- ---------------- -----------------
Net proceeds from sales of shares:
Class N ........................ 538,541 2,333,613 9,408,579 52,641,474
Class I ........................ -- -- -- --
Issued to shareholders in
reinvestment of distributions:
Class N ........................ 190,868 8,053 192,884 36,171
Class I ........................ -- -- -- --
Cost of shares repurchased:
Class N ........................ (4,083,965) (8,167,899) (8,091,070) (7,213,672)
Class I ........................ -- -- -- --
-------------- ---------------- ---------------- -----------------
Net increase (decrease) from
capital share transactions (3,354,556) (5,826,233) 1,510,393 45,463,973
-------------- ---------------- ---------------- -----------------
Total increase (decrease)
in net assets ............. 1,254,787 (5,141,654) 5,861,638 42,478,254
-------------- ---------------- ---------------- -----------------
NET ASSETS AT END OF PERIOD
(INCLUDING LINE A) ................ $ 18,840,825 $ 17,586,038 $ 48,339,902 $ 42,478,264
============== ================ ================ =================
(A) Undistributed (overdistributed)
net investment income .......... $ (52,353) $ -- $ 40,454 $ 146,540
============== ================ ================ =================
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................... 34,796 166,866 999,848 5,361,902
Issued to shareholders
in reinvestment
of distributions ............ 13,351 603 21,011 3,661
Repurchased .................... (263,983) (587,080) (849,804) (740,651)
Class I:
Sold ........................... -- -- -- --
Issued to shareholders
in reinvestment
of distributions ............ -- -- -- --
Repurchased .................... -- -- -- --
-------------- ---------------- ---------------- -----------------
Net increase (decrease)
in shares outstanding .... (215,836) (419,611) 171,055 4,624,912
============== ================ ================ =================
</TABLE>
ALLEGHANY/VEREDUS
AGGRESSIVE GROWTH FUND
-------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999
--------------- ---------------
NET ASSETS AT BEGINNING OF PERIOD ..... $ 57,281,574 $ 12,673,539
--------------- ---------------
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS:
Net investment income (loss) ...... (558,599) (270,497)
Net realized gain (loss) on
investments sold ............... 45,583,801 9,807,382
Net change in unrealized
appreciation (depreciation) on
investments and assets and
liabilities .................... (6,572,090) 10,248,334
--------------- ---------------
Net increase (decrease) in net
assets from operations ......... 38,453,112 19,785,219
--------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................ -- --
Net realized gain on investments:
Class N ........................ (8,782,878) --
Class I ........................ -- --
--------------- ---------------
Total distributions ............ (8,782,878) --
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares:
Class N ........................ 118,976,137 34,532,762
Class I ........................ -- --
Issued to shareholders in
reinvestment of distributions:
Class N ........................ 8,589,707 --
Class I ........................ -- --
Cost of shares repurchased:
Class N ........................ (49,468,854) (9,709,946)
Class I ........................ -- --
--------------- ---------------
Net increase (decrease) from
capital share transactions 78,096,990 24,822,816
--------------- ---------------
Total increase (decrease)
in net assets ............. 107,767,224 44,608,035
--------------- ---------------
NET ASSETS AT END OF PERIOD
(INCLUDING LINE A) ................ $ 165,048,798 $ 57,281,574
=============== ===============
(A) Undistributed (overdistributed)
net investment income .......... $ (558,599) $ --
=============== ===============
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................... 5,218,565 2,693,561
Issued to shareholders
in reinvestment
of distributions ............ 483,664 --
Repurchased .................... (2,097,075) (713,478)
Class I:
Sold ........................... -- --
Issued to shareholders
in reinvestment
of distributions ............ -- --
Repurchased .................... -- --
--------------- ---------------
Net increase (decrease)
in shares outstanding .... 3,605,154 1,980,083
=============== ===============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
53
<PAGE>
ALLEGHANY FUNDS
-------------------
STATEMENT OF CHANGES IN NET ASSETS - CONTINUED
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/BLAIRLOGIE INTERNATIONAL
DEVELOPED FUND
--------------------------------------------------------------------
SIX MONTHS ENDED SIX MONTHS TEN MONTHS YEAR ENDED
APRIL 30, 2000 ENDED OCTOBER 31, ENDED APRIL 30, JUNE 30,
(UNAUDITED) 1999 1999(A) 1998
---------------- ------------------ -------------- ---------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD $ 104,583,366 $ 106,362,307 $ 138,750,570 $ 100,313,146
---------------- ------------------ -------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss) ...................... (13,986) 640,627 (53,423) 1,253,862
Net realized gain (loss) on investments sold ...... 13,613,262 8,646,046 13,206,377 1,677,879
Net change in unrealized appreciation (depreciation)
on investments and assets and liabilities ...... (7,494,632) (3,656,254) (9,261,285) 16,311,500
---------------- ------------------ -------------- ---------------
Net increase (decrease) in net assets from operations 6,104,644 5,630,419 3,891,669 19,243,241
---------------- ------------------ -------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................................ (40,326) -- -- (37,910)
Class I ........................................ (684,209) -- (461,778) (833,712)
Net realized gain on investments:
Class N ........................................ (580,772) -- (948,765) (384,865)
Class I ........................................ (8,051,198) -- (12,721,855) (4,187,682)
Return of Capital .................................
Class N ........................................ -- -- -- --
Class I ........................................ -- -- -- --
---------------- ------------------ -------------- ---------------
Total distributions ............................ (9,356,505) -- (14,132,398) (5,444,169)
---------------- ------------------ -------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares:
Class N ........................................ 858,844 4,019,607 112,028,851 72,268,195
Class I ........................................ 20,604,394 59,579,527 88,175,722 66,711,810
Issued to shareholders in reinvestment of distributions:
Class N ........................................ 542,653 -- 808,014 382,709
Class I ........................................ 8,671,276 -- 12,916,908 4,241,759
Cost of shares repurchased:
Class N ........................................ (1,591,960) (2,225,372) (123,609,614) (64,166,601)
Class I ........................................ (64,438,079) (68,783,122) (112,467,415) (54,799,520)
---------------- ------------------ -------------- ---------------
Net increase (decrease) from capital
share transactions ...................... (35,352,872) (7,409,360) (22,147,534) 24,638,352
---------------- ------------------ -------------- ---------------
Total increase (decrease) in net assets ..... (38,604,733) (1,778,941) (32,388,263) 38,437,424
---------------- ------------------ -------------- ---------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ........ $ 65,978,633 $ 104,583,366 $ 106,362,307 $ 138,750,570
================ ================== ============== ===============
(A) Undistributed (overdistributed) net
investment income (loss) ....................... $ (21,063) $ 717,458 $ (4,476) $ 456,779
================ ================== ============== ===============
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................................... 64,667 322,638 8,379,342 5,291,704
Issued to shareholders in reinvestment of distributions 41,968 -- 62,711 32,851
Repurchased .................................... (118,007) (176,179) (9,182,886) (4,642,525)
Class I:
Sold ........................................... 1,568,515 4,694,010 6,455,344 5,096,974
Issued to shareholders in reinvestment of distributions 670,114 -- 1,009,365 366,765
Repurchased .................................... (4,884,658) (5,409,299) (8,037,843) (4,102,996)
---------------- ------------------ -------------- ---------------
Net increase (decrease) in shares outstanding (2,657,401) (568,830) (1,313,967) 2,042,773
================ ================== ============== ===============
</TABLE>
-------------------------------
(a) Alleghany/Blairlogie International Developed Fund andAlleghany/Blairlogie
Emerging Markets Fund stub audits for the period July 1, 1998 through April
30, 1999. Share transactions restated to reflect share conversion on April
30, 1999. (See Note A)
(b) Montag & Caldwell Balanced Fund-Class I commenced investment operations on
December 31, 1998.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
54
<PAGE>
ALLEGHANY FUNDS
-------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/BLAIRLOGIE
EMERGING MARKETS FUND
--------------------------------------------------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED TEN MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, JUNE 30,
(UNAUDITED) 1999 1999(A) 1998
-------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD $ 18,308,172 $ 19,004,118 $ 27,569,318 $ 55,175,256
-------------- ---------------- ---------------- ----------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss) ...................... 49,740 101,678 153,762 195,456
Net realized gain (loss) on investments sold ...... 1,679,445 375,008 (4,788,570) (3,044,479)
Net change in unrealized appreciation (depreciation)
on investments and assets and liabilities ...... 1,357,835 80,954 3,735,165 (10,784,766)
-------------- ---------------- ---------------- ----------------
Net increase (decrease) in net assets
from operations 3,087,020 557,640 (899,643) (13,633,789)
-------------- ---------------- ---------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................................ (2,599) -- (1,704) --
Class I ........................................ (51,540) -- (81,016) --
Net realized gain on investments:
Class N ........................................ -- -- -- --
Class I ........................................ -- -- -- --
Return of Capital .................................
Class N ........................................ -- -- (549) --
Class I ........................................ -- -- (26,128) --
-------------- ---------------- ---------------- ----------------
Total distributions ............................ (54,139) -- (109,397) --
-------------- ---------------- ---------------- ----------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares:
Class N ........................................ 3,637,523 1,167,427 4,825,690 5,950,664
Class I ........................................ 5,366,373 4,964,104 23,834,837 23,186,970
Issued to shareholders in reinvestment of
distributions:
Class N ........................................ 2,333 -- 4,501 --
Class I ........................................ 49,584 -- 93,520 --
Cost of shares repurchased:
Class N ........................................ (3,281,668) (421,986) (6,805,094) (4,095,422)
Class I ........................................ (9,702,828) (6,963,131) (29,509,614) (39,014,361)
-------------- ---------------- ---------------- ----------------
Net increase (decrease) from capital
share transactions ...................... (3,928,683) (1,253,586) (7,556,160) (13,972,149)
-------------- ---------------- ---------------- ----------------
Total increase (decrease) in net assets ..... (895,802) (695,946) (8,565,200) (27,605,938)
-------------- ---------------- ---------------- ----------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ........ $ 17,412,370 $ 18,308,172 $ 19,004,118 $ 27,569,318
============== ================ ================ ================
(A) Undistributed (overdistributed) net
investment income (loss) ....................... $ 40,733 $ 45,132 $ (1,001) $ (3,263)
============== ================ ================ ================
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................................... 257,582 108,246 561,023 497,628
Issued to shareholders in reinvestment of
distributions 185 -- 159 --
Repurchased .................................... (238,227) (39,603) (795,208) (346,442)
Class I:
Sold ........................................... 406,878 454,687 2,801,577 1,946,376
Issued to shareholders in reinvestment of
distributions 3,923 -- 10,113 --
Repurchased .................................... (739,541) (647,362) (3,463,865) (3,340,803)
-------------- ---------------- ---------------- ----------------
Net increase (decrease) in shares outstanding (309,200) (124,032) (886,201) (1,243,241)
============== ================ ================ ================
</TABLE>
<TABLE>
<CAPTION>
ALLEGHANY/MONTAG & CALDWELL
BALANCED FUND
------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999(B)
--------------- ---------------
<S> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD $ 251,192,049 $ 158,398,348
--------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss) ...................... 2,893,473 3,379,975
Net realized gain (loss) on investments sold ...... 17,986,960 12,323,201
Net change in unrealized appreciation (depreciation)
on investments and assets and liabilities ...... (7,005,031) 15,541,127
--------------- ---------------
Net increase (decrease) in net assets
from operations 13,875,402 31,244,303
--------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................................ (1,330,066) (2,253,523)
Class I ........................................ (1,309,154) (817,375)
Net realized gain on investments:
Class N ........................................ (7,228,901) (8,904,043)
Class I ........................................ (4,863,092) --
Return of Capital .................................
Class N ........................................ -- --
Class I ........................................ -- --
--------------- ---------------
Total distributions ............................ (14,731,213) (11,974,941)
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares:
Class N ........................................ 31,699,197 76,418,226
Class I ........................................ 115,262,990 97,458,628
Issued to shareholders in reinvestment of
distributions:
Class N ........................................ 8,430,101 11,005,944
Class I ........................................ 5,482,547 817,440
Cost of shares repurchased:
Class N ........................................ (30,594,714) (101,572,790)
Class I ........................................ (27,059,490) (10,603,109)
--------------- ---------------
Net increase (decrease) from capital
share transactions ...................... 103,220,631 73,524,339
--------------- ---------------
Total increase (decrease) in net assets ..... 102,364,820 92,793,701
--------------- ---------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ........ $ 353,556,869 $ 251,192,049
=============== ===============
(A) Undistributed (overdistributed) net
investment income (loss) ....................... $ 914,731 $ 660,478
=============== ===============
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................................... 1,647,534 4,064,233
Issued to shareholders in reinvestment of
distributions 435,253 621,725
Repurchased .................................... (1,592,028) (5,426,672)
Class I:
Sold ........................................... 6,126,883 5,199,224
Issued to shareholders in reinvestment of
distributions 284,088 43,055
Repurchased .................................... (1,412,210) (561,037)
--------------- ---------------
Net increase (decrease) in shares outstanding 5,489,520 3,940,528
=============== ===============
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
55
<PAGE>
ALLEGHANY FUNDS
-------------------
STATEMENT OF CHANGES IN NET ASSETS - CONTINUED
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/ ALLEGHANY/
CHICAGO TRUST CHICAGO TRUST
BALANCED FUND BOND FUND
----------------------------------- --------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
---------------- ------------------ -------------- ---------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD ..................... $ 294,426,017 $ 219,361,542 $ 133,408,155 $ 160,561,220
---------------- ------------------ -------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ............................. 3,364,483 5,674,652 4,449,688 9,236,090
Net realized gain (loss) on investments sold ...... 14,788,004 8,203,023 (1,725,763) (446,987)
Net change in unrealized appreciation (depreciation)
on investments and assets and liabilities ...... 6,037,585 25,535,665 (83,978) (7,370,531)
---------------- ------------------ -------------- ---------------
Net increase (decrease) in net assets from operations 24,190,072 39,413,340 2,639,947 1,418,572
---------------- ------------------ -------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................................ (3,404,531) (5,364,029) (4,433,288) (9,226,493)
Net realized gain on investments:
Class N ........................................ (8,216,573) (13,010,618) -- (708,779)
---------------- ------------------ -------------- ---------------
Total distributions ............................ (11,621,104) (18,374,647) (4,433,288) (9,935,272)
---------------- ------------------ -------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares:
Class N ........................................ 33,087,858 100,719,712 25,216,238 46,629,918
Issued to shareholders in reinvestment of distributions:
Class N ........................................ 11,609,056 18,361,299 3,795,563 8,833,465
Cost of shares repurchased:
Class N ........................................ (40,233,564) (65,055,229) (20,338,585) (74,099,748)
---------------- ------------------ -------------- ---------------
Net increase (decrease) from capital
share transactions ...................... 4,463,350 54,025,782 8,673,216 (18,636,365)
---------------- ------------------ -------------- ---------------
Total increase (decrease) in net assets ..... 17,032,318 75,064,475 6,879,875 (27,153,065)
---------------- ------------------ -------------- ---------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ........ $ 311,458,335 $ 294,426,017 $ 140,288,030 $ 133,408,155
================ ================== ============== ===============
(A) Undistributed net investment income ........... $ 936,114 $ 976,162 $ 443,316 $ 426,916
================ ================== ============== ===============
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................................... 2,508,627 7,946,222 2,626,407 4,672,863
Issued to shareholders in reinvestment
of distributions ............................ 900,171 1,540,005 394,546 869,864
Repurchased .................................... (3,062,687) (5,135,906) (2,116,749) (7,442,578)
---------------- ------------------ -------------- ---------------
Net increase (decrease) in shares outstanding 346,111 4,350,321 904,204 (1,899,851)
================ ================== ============== ===============
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
56
<PAGE>
ALLEGHANY FUNDS
-------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ALLEGHANY/ ALLEGHANY/
CHICAGO TRUST CHICAGO TRUST
MUNICIPAL BOND FUND MONEY MARKET FUND
---------------------------------- -----------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2000 OCTOBER 31, APRIL 30, 2000 OCTOBER 31,
(UNAUDITED) 1999 (UNAUDITED) 1999
-------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
NET ASSETS AT BEGINNING OF PERIOD ..................... $ 17,219,295 $ 13,209,908 $ 335,140,215 $ 281,389,294
-------------- ---------------- ---------------- ----------------
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ............................. 399,704 722,732 10,955,582 14,080,829
Net realized gain (loss) on investments sold ...... (279,505) 24,495 -- --
Net change in unrealized appreciation (depreciation)
on investments and assets and liabilities ...... 248,658 (1,093,220) -- --
-------------- ---------------- ---------------- ----------------
Net increase (decrease) in net assets from operations 368,857 (345,993) 10,955,582 14,080,829
-------------- ---------------- ---------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income:
Class N ........................................ (437,630) (711,409) (10,955,582) ( 14,080,829)
Net realized gain on investments:
Class N ........................................ -- -- -- --
-------------- ---------------- ---------------- ----------------
Total distributions ............................ (437,630) (711,409) (10,955,582) ( 14,080,829)
-------------- ---------------- ---------------- ----------------
CAPITAL SHARE TRANSACTIONS:
Net proceeds from sales of shares:
Class N ........................................ 889,618 7,470,973 1,017,988,086 1,295,225,039
Issued to shareholders in reinvestment of distributions:
Class N ........................................ 86,242 126,534 1,733,139 1,813,603
Cost of shares repurchased:
Class N ........................................ (2,090,955) (2,530,718) (963,272,979) (1,243,287,721)
-------------- ---------------- ---------------- ----------------
Net increase (decrease) from capital
share transactions ...................... (1,115,095) 5,066,789 56,448,246 53,750,921
-------------- ---------------- ---------------- ----------------
Total increase (decrease) in net assets ..... (1,183,868) 4,009,387 56,448,246 53,750,921
-------------- ---------------- ---------------- ----------------
NET ASSETS AT END OF PERIOD (INCLUDING LINE A) ........ $ 16,035,427 $ 17,219,295 $ 391,588,461 $ 335,140,215
-------------- ---------------- ---------------- ----------------
(A) Undistributed net investment income ........... $ -- $ 37,926 $ -- $ --
============== ================ ================ ================
OTHER INFORMATION:
SHARE TRANSACTIONS:
Class N:
Sold ........................................... 91,885 731,430 1,017,988,086 1,295,225,039
Issued to shareholders in reinvestment
of distributions ............................ 8,863 12,464 1,733,139 1,813,603
Repurchased .................................... (215,420) (249,136) (963,272,979) (1,243,287,721)
-------------- ---------------- ---------------- ----------------
Net increase (decrease) in shares outstanding (114,672) 494,758 56,448,246 53,750,921
============== ================ ================ ================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
57
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL GROWTH FUND - CLASS N APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/MONTAG & CALDWELL GROWTH FUND - CLASS N
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR PERIOD
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95(A)
------------ -------------- ------------ ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period... $ 33.15 $ 26.49 $ 22.68 $ 17.08 $ 13.16 $ 10.00
---------- ---------- ---------- -------- -------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) ..... (0.04) (0.04) (0.05) (0.05) -- 0.02
Net realized and unrealized
gain on investments ........... 1.81 7.64 4.07 5.79 3.93 3.16
---------- ---------- ---------- -------- -------- -------
Total from investment
operations ................. 1.77 7.60 4.02 5.74 3.93 3.18
---------- ---------- ---------- -------- -------- -------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income ...... -- -- -- -- (0.01) (0.02)
Distributions from net realized
gain on investments ........... (1.65) (0.94) (0.21) (0.14) -- --
---------- ---------- ---------- -------- -------- -------
Total distributions ........... (1.65) (0.94) (0.21) (0.14) (0.01) (0.02)
---------- ---------- ---------- -------- -------- -------
Net increase in net asset value ....... 0.12 6.66 3.81 5.60 3.92 3.16
---------- ---------- ---------- -------- -------- -------
Net Asset Value, End of Period ........ $ 33.27 $ 33.15 $ 26.49 $ 22.68 $ 17.08 $ 13.16
========== ========== ========== ======== ======== =======
TOTAL RETURN(1) ....................... 5.27% 29.34% 17.90% 33.82% 29.91% 31.87%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period
(in 000's) ....................... $1,617,882 $1,612,796 $1,004,356 $479,557 $166,243 $40,355
Ratios of expenses to average
net assets:
Before reimbursement of
expenses by Adviser(2) ........ 1.02% 1.05% 1.12% 1.24% 1.32% 1.87%
After reimbursement of
expenses by Adviser(2) ........ 1.02% 1.05% 1.12% 1.23% 1.28% 1.30%
Ratios of net investment income
(loss) to average net assets:
Before reimbursement of expenses
by Adviser(2) ................. (0.20)% (0.16)% (0.22)% (0.38)% (0.10)% (0.36)%
After reimbursement of expenses
by Adviser(2) ................. (0.20)% (0.16)% (0.22)% (0.37)% (0.06)% 0.20%
Portfolio Turnover(1) .............. 29.62% 31.59% 29.81% 18.65% 26.36% 34.46%
</TABLE>
---------------------
(1) Not Annualized.
(2) Annualized.
(a) Alleghany/Montag & Caldwell Growth Fund - Class N commenced investment
operations on November 2, 1994.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
58
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL GROWTH FUND - CLASS I APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/MONTAG & CALDWELL GROWTH FUND - CLASS I
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR PERIOD
04/30/00 ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96(A)
------------ ------------ ----------- ----------- ---------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period..................... $ 33.46 $ 26.65 $ 22.75 $ 17.08 $ 15.59
---------- --------- -------- -------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .............................. 0.01 0.04 0.01 --(b) 0.02
Net realized and unrealized gain
on investments .................................. 1.84 7.71 4.10 5.81 1.49
---------- --------- -------- -------- -------
Total from investment operations ................ 1.85 7.75 4.11 5.81 1.51
---------- --------- -------- -------- -------
LESS DISTRIBUTIONS:
Distributions from and in excess of net
investment income ............................... -- -- -- -- (0.02)
Distributions from net realized gain on investments (1.65) (0.94) (0.21) (0.14) --
---------- --------- -------- -------- -------
Total distributions ............................. (1.65) (0.94) (0.21) (0.14) (0.02)
---------- --------- -------- -------- -------
Net increase in net asset value ......................... 0.20 6.81 3.90 5.67 1.49
---------- --------- -------- -------- -------
Net Asset Value, End of Period .......................... $ 33.66 $ 33.46 $ 26.65 $ 22.75 $ 17.08
========== ========== ======== ======== =======
TOTAL RETURN(1) ......................................... 5.41% 29.78% 18.24% 34.26% 9.67%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ................. $1,573,718 $1,369,673 $738,423 $268,861 $52,407
Ratios of expenses to average net assets:
Before reimbursement of expenses by Adviser(2) ..... 0.74% 0.76% 0.85% 0.93% 0.98%
After reimbursement of expenses by Adviser(2) ...... 0.74% 0.76% 0.85% 0.93% 0.98%
Ratios of net investment income (loss) to average net assets:
Before reimbursement of expenses by Adviser(2) ..... 0.08% 0.14% 0.05% (0.07)% 0.17%
After reimbursement of expenses by Adviser(2) ...... 0.08% 0.14% 0.05% (0.06)% 0.17%
Portfolio Turnover(1) ................................ 29.62% 31.59% 29.81% 18.65% 26.36%
</TABLE>
---------------------
(1) Not Annualized.
(2) Annualized.
(a) Montag & Caldwell Growth Fund - Class I commenced investment operations on
June 28, 1996.
(b) Represents less than $.01 per share.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
59
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST GROWTH & INCOME FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/CHICAGO TRUST GROWTH & INCOME FUND
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
---------- ----------- ---------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period. ..... $ 27.71 $ 23.06 $ 19.73 $ 16.17 $ 12.90 $ 10.11
-------- -------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) ......... (0.02) (0.06) (0.02) 0.08 0.11 0.09
Net realized and unrealized gain
on investments .................... 3.53 6.14 4.73 3.91 3.34 2.79
-------- -------- -------- -------- -------- --------
Total from investment operations .. 3.51 6.08 4.71 3.99 3.45 2.88
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income .......... -- -- (0.01) (0.09) (0.11) (0.09)
Distributions from net realized
gain on investments ............... (2.00) (1.43) (1.37) (0.34) (0.07) --
-------- -------- -------- -------- -------- --------
Total distributions ............... (2.00) (1.43) (1.38) (0.43) (0.18) (0.09)
-------- -------- -------- -------- -------- --------
Net increase in net asset value ........... 1.51 4.65 3.33 3.56 3.27 2.79
-------- -------- -------- -------- -------- --------
Net Asset Value, End of Period ............ $ 29.22 $ 27.71 $ 23.06 $ 19.73 $ 16.17 $ 12.90
======== ======== ======== ======== ======== ========
TOTAL RETURN(1) ........................... 13.26% 27.71% 25.43% 25.16% 26.98% 28.66%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ... $567,512 $490,189 $367,666 $274,608 $205,133 $172,296
Ratios of expenses to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 1.07% 1.06% 1.08% 1.12% 1.15% 1.50%
After reimbursement of expenses
by Adviser(2) ..................... 1.07% 1.06% 1.08% 1.07%(3) 1.00% 1.09%(4)
Ratios of net investment income
(loss) to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... (0.11)% (0.25)% (0.11)% 0.36% 0.62% 0.33%
After reimbursement of expenses
by Adviser(2) ..................... (0.11)% (0.25)% (0.11)% 0.41% 0.77% 0.74%
Portfolio Turnover(1) .................. 13.28% 28.93% 34.21% 30.58% 25.48% 9.00%
</TABLE>
----------------------
(1) Not Annualized.
(2) Annualized.
(3) The Adviser's expense reimbursement level, which affects the net expense
ratio, changed from 1.00% to 1.10% on February 28, 1997.
(4) The Adviser's expense reimbursement level, which affects the net expense
ratio, changed from 1.20% to 1.00% on September 21, 1995.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
60
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST TALON FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/CHICAGO TRUST TALON FUND
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
--------- --------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period....... $ 13.45 $ 13.16 $ 17.60 $ 14.39 $ 12.07 $ 10.25
------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) ......... (0.05) (0.05) 0.07 0.11 0.04 0.09
Net realized and unrealized gain
(loss) on investments ............. 4.02 0.34 (1.59) 4.38 3.01 1.84
------- ------- ------- ------- ------- -------
Total from investment operations .. 3.97 0.29 (1.52) 4.49 3.05 1.93
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income .......... -- --(a) (0.09) (0.09) (0.03) (0.11)
Distributions from net realized
gain on investments ............... (0.15) -- (2.83) (1.19) (0.70) --
------- ------- ------- ------- ------- -------
Total distributions ............... (0.15) -- (2.92) (1.28) (0.73) (0.11)
------- ------- ------- ------- ------- -------
Net increase (decrease) in net asset value 3.82 0.29 (4.44) 3.21 2.32 1.82
------- ------- ------- ------- ------- -------
Net Asset Value, End of Period ............ $ 17.27 $ 13.45 $ 13.16 $ 17.60 $ 14.39 $ 12.07
======= ======= ======= ======= ======= =======
TOTAL RETURN(1) ........................... 29.61% 2.32% (10.54)% 33.47% 26.51% 18.92%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ... $18,841 $17,586 $22,728 $28,460 $17,418 $10,538
Ratios of expenses to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 1.51% 1.50% 1.46% 1.67% 1.98% 3.04%
After reimbursement of expenses
by Adviser(2) ..................... 1.30% 1.30% 1.30% 1.30% 1.30% 1.30%
Ratios of net investment income
(loss) to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... (0.78)% (0.50)% 0.30% 0.34% (0.38)% (0.97)%
After reimbursement of expenses
by Adviser(2) ..................... (0.57)% (0.30)% 0.46% 0.71% 0.30% 0.77%
Portfolio Turnover(1) .................. 54.75% 101.44% 78.33% 112.72% 126.83% 229.43%
</TABLE>
-----------------
(1) Not Annualized.
(2) Annualized.
(a) Represents less than $.01 per share.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
61
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/CHICAGO TRUST SMALL CAP VALUE FUND
SIX MONTHS
ENDED PERIOD
04/30/00 ENDED
(UNAUDITED) 10/31/99(A)
--------- ---------
Net Asset Value, Beginning of Period. ................. $ 9.18 $ 10.00
------ -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ............................ 0.02 0.04
Net realized and unrealized gain (loss)
on investments ................................ 0.92 (0.85)
------ -------
Total from investment operations .............. 0.94 (0.81)
------ -------
LESS DISTRIBUTIONS:
Distributions from and in excess of net
investment income ............................. (0.04) (0.01)
Distributions from net realized gain
on invetments ................................. -- --
------ -------
Total distributions ........................... (0.04) (0.01)
------ -------
Net increase (decrease) in net asset value ............ 0.90 (0.82)
------ -------
Net Asset Value, End of Period ........................ $ 10.08 $ 9.18
======= =======
TOTAL RETURN(1) ....................................... 10.34% (8.07)%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ............... $48,340 $42,478
Ratios of expenses to average net assets:
Before reimbursement of expenses by Adviser(2) ... 1.49% 1.55%
After reimbursement of expenses by Adviser(2) .... 1.40% 1.40%
Ratios of net investment income to
average net assets:
Before reimbursement of expenses by Adviser(2) ... 0.35% 0.36%
After reimbursement of expenses by Adviser(2) .... 0.44% 0.51%
Portfolio Turnover(1) .............................. 122.79% 156.55%
------------------
(1) Not Annualized.
(2) Annualized.
(a) Alleghany/Chicago Trust SmallCap Value Fund commenced investment operations
on November 10, 1998.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
62
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/VEREDUS AGGRESSIVE GROWTH FUND
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR PERIOD
04/30/00 ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98(A)
---------- ---------- ---------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period. ............................................. $ 16.60 $ 8.62 $ 10.00
-------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss) ................................................. (0.08) (0.08) --(b)
Net realized and unrealized gain (loss) on investments ....................... 9.24 8.06 (1.38)
-------- ------- -------
Total from investment operations .......................................... 9.16 7.98 (1.38)
-------- ------- -------
LESS DISTRIBUTIONS:
Distributions from net realized gain on investments .......................... (2.37) -- --
-------- ------- -------
Total distributions ....................................................... (2.37) -- --
-------- ------- -------
Net increase (decrease) in net asset value ........................................ 6.79 7.98 (1.38)
-------- ------- -------
Net Asset Value, End of Period .................................................... $ 23.39 $ 16.60 $ 8.62
======== ======= =======
TOTAL RETURN(1) ................................................................... 59.41% 92.92% (13.80)%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ........................................... $165,049 $57,282 $12,674
Ratios of expenses to average net assets:
Before reimbursement of expenses by Adviser(2) ............................... 1.45% 1.58% 1.54%
After reimbursement of expenses by Adviser(2) ................................ 1.40% 1.41%(3) 1.50%
Ratios of net investment income (loss) to average net assets:
Before reimbursement of expenses by Adviser(2) ............................... (0.98)% (1.05)% (0.06)%
After reimbursement of expenses by Adviser(2) ................................ (0.93)% (0.88)% (0.02)%
Portfolio Turnover(1) .......................................................... 111.40% 204.26% 111.52%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
(3) The Adviser fee, which affects the net expense ratio, changed from 1.50% to
1.00% on December 4, 1998.
(a) Alleghany/Veredus Aggressive Growth Fund commenced investment operations on
June 30, 1998.
(b) Represents less than $0.01 per share.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
63
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND - CLASS N APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND - CLASS N
<TABLE>
<CAPTION>
SIX MONTHS SIX TEN EIGHT ELEVEN
ENDED MONTHS MONTHS YEAR YEAR MONTHS MONTHS
04/30/00 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 04/30/99 06/30/98 06/30/97 06/30/96 10/31/95(A)
---------- --------- --------- --------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ... $13.37 $12.70 $14.30 $13.05 $12.51 $11.73 $11.21
------ ------ ------ ------ ------ ------ ------
INCOME FROM
INVESTMENT OPERATIONS:
Net investment income (loss) ...... (0.01) 0.06 (0.02) 0.17 0.06 0.69 0.02
Net realized and unrealized
gain on investments ............ 0.65 0.61 0.16 1.69 1.09 0.72 1.01
------ ------ ------ ------ ------ ------ ------
Total from investment
operations .................. 0.64 0.67 0.14 1.86 1.15 1.41 1.03
------ ------ ------ ------ ------ ------ ------
LESS DISTRIBUTIONS:
Distributions from and
in excess of net
investment income .............. (0.08) -- -- (0.03) -- (0.42) (0.08)
Distributions from net
realized gain on
investments .................... (1.13) -- (1.74) (0.58) (0.61) (0.21) (0.43)
------ ------ ------ ------ ------ ------ ------
Total distributions ............ (1.21) -- (1.74) (0.61) (0.61) (0.63) (0.51)
------ ------ ------ ------ ------ ------ ------
Net increase (decrease)
in net asset value .................. (0.57) 0.67 (1.60) 1.25 0.54 0.78 0.52
------ ------ ------ ------ ------ ------ ------
Net Asset Value, End of Period ......... $12.80 $13.37 $12.70 $14.30 $13.05 $12.51 $11.73
====== ====== ====== ====== ====== ====== ======
TOTAL RETURN(1) ........................ 4.54% 5.35% 1.05% 15.33% 9.77% 12.33% 9.61%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period
(in 000's) ........................ $7,048 $7,516 $5,278(3) $6,299 $2,302 $5,624 $ 675
Ratios of expenses to
average net assets:
Before reimbursement of
expenses by Adviser(2) ......... 1.40% 1.41% 1.41% 1.36% 1.38% 1.35% 1.34%
After reimbursement of
expenses by Adviser(2) ......... 1.35% 1.35% 1.41% 1.36% 1.38% 1.35% 1.34%
Ratios of net investment
income (loss) to average
net assets:
Before reimbursement of
expenses by Adviser(2) ......... (0.31)% 0.95% (0.21)% 1.31% 0.52% 1.04% 0.50%
After reimbursement of
expenses by Adviser(2) ......... (0.26)% 1.01% (0.21)% 1.31% 0.52% 1.04% 0.50%
Portfolio Turnover(1) ............... 29.87% 28.91% 36.00% 60.00% 77.00% 60.00% 58.00%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
(3) Net assets at end of period do not reflect Class A, B, or C net assets prior
to April 30, 1999.
(a) Alleghany/Blairlogie International Developed Fund - Class N commenced
investment operations on November 30, 1994.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
64
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND - CLASS I APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/BLAIRLOGIE INTERNATIONAL DEVELOPED FUND - CLASS I
<TABLE>
<CAPTION>
SIX MONTHS SIX TEN EIGHT ELEVEN
ENDED MONTHS MONTHS YEAR YEAR MONTHS MONTHS
04/30/00 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 04/30/99 06/30/98 06/30/97 06/30/96 10/31/95
---------- --------- ----------- ---------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period. .................. $ 13.40 $ 12.70 $ 14.32 $ 13.12 $ 12.54 $ 11.74 $ 11.86
------- ------- -------- -------- ------- ------- -------
INCOME FROM
INVESTMENT OPERATIONS:
Net investment income (loss) ........ -- 0.08 -- 0.16 0.10 0.72 0.10
Net realized and unrealized
gain on investments .............. 0.65 0.62 0.17 1.73 1.09 0.72 0.30
------- ------- -------- -------- ------- ------- -------
Total from investment
operations ..................... 0.65 0.70 0.17 1.89 1.19 1.44 0.40
------- ------- -------- -------- ------- ------- -------
LESS DISTRIBUTIONS:
Distributions from and
in excess of net
investment income ................ (0.10) -- (0.05) (0.11) -- (0.43) (0.09)
Distributions from net
realized gain on
investments ...................... (1.13) -- (1.74) (0.58) (0.61) (0.21) (0.43)
------- ------- -------- -------- ------- ------- -------
Total distributions .............. (1.23) -- (1.79) (0.69) (0.61) (0.64) (0.52)
------- ------- -------- -------- ------- ------- -------
Net increase (decrease)
in net asset value .................... (0.58) 0.70 (1.62) 1.20 0.58 0.80 (0.12)
------- ------- -------- -------- ------- ------- -------
Net Asset Value, End of Period ........... $ 12.82 $ 13.40 $ 12.70 $ 14.32 $ 13.12 $ 12.54 $ 11.74
======= ======= ======== ======== ======= ======= =======
TOTAL RETURN(1) .......................... 4.67% 5.51% 1.31% 15.69% 10.07% 12.54% 3.83%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period
(in 000's) .......................... $58,931 $97,067 $101,084 $122,126 $94,044 $70,207 $63,607
Ratios of expenses to
average net assets:
Before reimbursement of
expenses by Adviser(2) ........... 1.15% 1.16% 1.16% 1.11% 1.13% 1.10% 1.10%
After reimbursement of
expenses by Adviser(2) ........... 1.10% 1.10% 1.16% 1.11% 1.13% 1.10% 1.10%
Ratios of net investment
income (loss) to average net assets:
Before reimbursement of
expenses by Adviser(2) ........... (0.06)% 1.20% 0.04% 1.20% 0.85% 0.81% 1.10%
After reimbursement of
expenses by Adviser(2) ........... (0.01)% 1.26% 0.04% 1.20% 0.85% 0.81% 1.10%
Portfolio Turnover(1) ................. 29.87% 28.91% 36.00% 60.00% 77.00% 60.00% 63.00%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
65
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND - CLASS N APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND - CLASS N
<TABLE>
<CAPTION>
SIX MONTHS SIX TEN EIGHT
ENDED MONTHS MONTHS YEAR YEAR MONTHS YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 04/30/99 06/30/98 06/30/97 06/30/96 10/31/95
---------- --------- --------- --------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period ................. $10.75 $10.42 $10.14 $13.95 $12.63 $11.24 $ 16.95
------ ------ ------ ------ ------ ------ -------
INCOME FROM
INVESTMENT OPERATIONS:
Net investment income ............. 0.02 0.05 0.05 0.09 -- 0.02 --
Net realized and unrealized
gain(loss) on investments ...... 1.76 0.28 0.23 (3.90) 1.32 1.40 (4.95)
------ ------ ------ ------ ------ ------ -------
Total from investment
operations .................. 1.78 0.33 0.28 (3.81) 1.32 1.42 (4.95)
------ ------ ------ ------ ------ ------ -------
LESS DISTRIBUTIONS:
Distributions from and
in excess of net
investment income .............. (0.02) -- -- -- -- (0.03) (0.05)
Distributions from net
realized gain on
investments .................... -- -- -- -- -- -- (0.71)
------ ------ ------ ------ ------ ------ -------
Total distributions ............ (0.02) -- -- -- -- (0.03) (0.76)
------ ------ ------ ------ ------ ------ -------
Net increase (decrease)
in net asset value .................. 1.76 0.33 0.28 (3.81) 1.32 1.39 (5.71)
------ ------ ------ ------ ------ ------ -------
Net Asset Value, End of Period ......... $12.51 $10.75 $10.42 $10.14 $13.95 $12.63 $ 11.24
====== ====== ====== ====== ====== ====== =======
TOTAL RETURN(1) ........................ 16.51% 3.26% 2.76% (27.31)% 10.45% 12.70% (27.96)%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period
(in 000's) ........................ $2,257 $1,729 $ 961(3) $1,339 $ 117 $ 368 $ 830
Ratios of expenses to
average net assets:
Before reimbursement of
expenses by Adviser(2) ......... 1.97% 2.07% 1.68% 1.65% 1.69% 1.61% 1.62%
After reimbursement of
expenses by Adviser(2) ......... 1.60% 1.60% 1.68% 1.65% 1.69% 1.61% 1.62%
Ratios of net investment
income (loss) to average
net assets:
Before reimbursement of
expenses by Adviser(2) ......... (0.11)% 0.41% 0.69% 0.81% 0.02% 0.18% 0.02%
After reimbursement of
expenses by Adviser(2) ......... 0.26% 0.88% 0.69% 0.81% 0.02% 0.18% 0.02%
Portfolio Turnover(1) ............... 17.99% 46.93% 38.00% 52.00% 74.00% 74.00% 118.00%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
(3) Net assets at end of period do not reflect Class A, B, or C net assets prior
to April 30, 1999.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
66
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND - CLASS I APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/BLAIRLOGIE EMERGING MARKETS FUND - CLASS I
<TABLE>
<CAPTION>
SIX MONTHS SIX TEN EIGHT
ENDED MONTHS MONTHS YEAR YEAR MONTHS YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 04/30/99 06/30/98 06/30/97 06/30/96 10/31/95
--------- --------- ----------- ---------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period. .................. $ 10.79 $ 10.43 $ 10.18 $ 13.96 $ 12.66 $ 11.27 $ 16.53
------- ------- ------- ------- ------- ------- -------
INCOME FROM
INVESTMENT OPERATIONS:
Net investment income ............... 0.04 0.06 0.06 0.06 0.06 0.03 0.07
Net realized and unrealized
gain(loss) ....................... 1.75 0.30 0.23 (3.84) 1.30 1.40 (4.55)
------- ------- ------- ------- ------- ------- -------
Total from investment
operations .................... 1.79 0.36 0.29 (3.78) 1.36 1.43 (4.48)
------- ------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income ......... (0.04) -- (0.03) -- (0.06) (0.04) (0.06)
Distributions from net realized
gain on investments .............. -- -- -- -- -- -- (0.72)
Return of capital distributions ..... -- -- (0.01) -- -- -- --
------- ------- ------- ------- ------- ------- -------
Total distributions .............. (0.04) -- (0.04) -- (0.06) (0.04) (0.78)
------- ------- ------- ------- ------- ------- -------
Net increase (decrease)
in net asset value .................... 1.75 0.36 0.25 (3.78) 1.30 1.39 (5.26)
------- ------- ------- ------- ------- ------- -------
Net Asset Value, End of Period ........... $ 12.54 $ 10.79 $ 10.43 $ 10.18 $ 13.96 $ 12.66 $ 11.27
======= ======= ======= ======= ======= ======= =======
TOTAL RETURN(1) .......................... 16.55% 3.45% 2.98% (27.08)% 10.85% 12.70% (27.70)%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period
(in 000's) .......................... $15,155 $16,579 $18,043 $24,251 $52,703 $80,545 $73,539
Ratios of expenses to
average net assets:
Before reimbursement of
expenses by Adviser(2) ........... 1.72% 1.82% 1.43% 1.39% 1.45% 1.35% 1.35%
After reimbursement of
expenses by Adviser(2) ........... 1.35% 1.35% 1.43% 1.39% 1.45% 1.35% 1.35%
Ratios of net investment
income to average net assets:
Before reimbursement of
expenses by Adviser(2) ........... 0.14% 0.66% 0.94% 0.52% 0.45% 0.84% 0.57%
After reimbursement of
expenses by Adviser(2) ........... 0.51% 1.13% 0.94% 0.52% 0.45% 0.84% 0.57%
Portfolio Turnover(1) ................. 17.99% 46.93% 38.00% 52.00% 74.00% 74.00% 118.00%
</TABLE>
---------------------
(1) Not Annualized.
(2) Annualized.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
67
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/MONTAG & CALDWELL BALANCED FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/MONTAG & CALDWELL BALANCED FUND
<TABLE>
<CAPTION>
CLASS N CLASS I
---------------------------------------------------------------- -----------------------
SIX MONTHS SIX MONTHS
ENDED YEAR YEAR YEAR YEAR PERIOD ENDED PERIOD
04/30/00 ENDED ENDED ENDED ENDED ENDED 04/30/00 ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95(A) (UNAUDITED) 10/31/99(B)
--------- ---------- ---------- --------- --------- -------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period .. $ 19.41 $ 17.60 $ 16.01 $ 14.29 $ 12.12 $ 10.00 $ 19.42 $ 18.36
-------- -------- -------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ............ 0.17 0.29 0.27 0.25 0.27 0.26 0.18 0.25
Net realized and unrealized gain
on investments ................ 0.64 2.73 1.97 2.93 2.17 2.09 0.67 1.03
-------- -------- -------- ------- ------- ------- ------- -------
Total from investment
operations ................. 0.81 3.02 2.24 3.18 2.44 2.35 0.85 1.28
-------- -------- -------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income ...... (0.16) (0.27) (0.27) (0.25) (0.27) (0.23) (0.19) (0.22)
Distributions from net realized
gain on investments ........... (0.88) (0.94) (0.38) (1.21) -- -- (0.88) --
-------- -------- -------- ------- ------- ------- ------- -------
Total distributions ........... (1.04) (1.21) (0.65) (1.46) (0.27) (0.23) (1.07) (0.22)
-------- -------- -------- ------- ------- ------- ------- -------
Net increase (decrease)in
net asset value .................... (0.23) 1.81 1.59 1.72 2.17 2.12 (0.22) 1.06
-------- -------- -------- ------- ------- ------- ------- -------
Net Asset Value, End of Period ........ $ 19.18 $ 19.41 $ 17.60 $ 16.01 $ 14.29 $ 12.12 $ 19.20 $ 19.42
======== ======== ======== ======= ======= ======= ======== =======
TOTAL RETURN(1) ....................... 4.14% 17.83% 14.46% 24.26% 20.37% 23.75% 4.27% 6.98%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period
(in 000's) ....................... $167,747 $160,286 $158,398 $82,719 $31,473 $21,908 $185,810 $90,906
Ratios of expenses to average
net assets:
Before reimbursement of expenses
by Adviser(2) ................. 1.14% 1.14% 1.18% 1.33% 1.58% 2.50% 0.88% 0.91%
After reimbursement of expenses
by Adviser(2) ................. 1.14% 1.14% 1.18% 1.25% 1.25% 1.25% 0.88% 0.91%
Ratios of net investment income
to average net assets:
Before reimbursement of expenses
by Adviser(2) ................. 1.83% 1.54% 1.67% 1.70% 1.83% 1.38% 2.09% 1.77%
After reimbursement of expenses
by Adviser(2) ................. 1.83% 1.54% 1.67% 1.78% 2.16% 2.63% 2.09% 1.77%
Portfolio Turnover(1) .............. 27.16% 34.79% 59.02% 28.13% 43.58% 27.33% 27.16% 34.79%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
(a) Alleghany/Montag & Caldwell Balanced Fund -- Class N commenced investment
operations on November 2, 1994.
(b) Montag & Caldwell Balanced Fund -- Class I commenced investment operations
on December 31, 1998.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
68
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BALANCED FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/CHICAGO TRUST BALANCED FUND
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR PERIOD
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95(A)
---------- ----------- ---------- ----------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ...... $ 13.04 $ 12.03 $ 11.06 $ 9.60 $ 8.43 $ 8.34
-------- -------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................ 0.15 0.27 0.27 0.28 0.27 0.03
Net realized and unrealized gain
on investments .................... 0.91 1.71 1.65 1.60 1.16 0.06
-------- -------- -------- -------- -------- --------
Total from investment operations .. 1.06 1.98 1.92 1.88 1.43 0.09
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income .......... (0.15) (0.26) (0.27) (0.28) (0.26) --
Distributions from net realized
gain on investments ............... (0.37) (0.71) (0.68) (0.14) -- --
-------- -------- -------- -------- -------- --------
Total distributions ............... (0.52) (0.97) (0.95) (0.42) (0.26) --
-------- -------- -------- -------- -------- --------
Net increase in net asset value ........... 0.54 1.01 0.97 1.46 1.17 0.09
-------- -------- -------- -------- -------- --------
Net Asset Value, End of Period ............ $ 13.58 $ 13.04 $ 12.03 $ 11.06 $ 9.60 $ 8.43
======== ======== ======== ======== ======== ========
TOTAL RETURN(1) ........................... 8.41% 17.26% 18.50% 20.10% 17.21% 1.08%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ... $311,458 $294,426 $219,362 $187,993 $156,703 $152,820
Ratios of expenses to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 1.05% 1.06% 1.08% 1.13% 1.17% 1.19%
After reimbursement of expenses
by Adviser(2) ..................... 1.05% 1.06% 1.08% 1.07%(3) 1.00% 1.00%
Ratios of net investment income
to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 2.25% 2.13% 2.30% 2.70% 2.79% 2.56%
After reimbursement of expenses
by Adviser(2) ..................... 2.25% 2.13% 2.30% 2.76% 2.96% 2.73%
Portfolio Turnover(1) .................. 17.91% 25.05% 40.28% 34.69% 34.29% 0.72%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
(3) The Adviser's expense reimbursement level, which affects the net expense
ratio, changed from 1.00% to 1.10% on February 28, 1997.
(a) Alleghany/Chicago Trust Balanced Fund (formerly the Chicago Trust Asset
Allocation Fund)-Class N commenced investment operations on September 21,
1995.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
69
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST BOND FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/CHICAGO TRUST BOND FUND
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
---------- ----------- ----------- ----------- ---------- --------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ...... $ 9.71 $ 10.27 $ 10.13 $ 9.89 $ 9.94 $ 9.21
-------- --------- -------- -------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................ 0.32 0.61 0.60 0.61 0.60 0.60
Net realized and unrealized gain
(loss) on investments ............. (0.13) (0.51) 0.15 0.23 (0.05) 0.73
-------- --------- -------- -------- ------- -------
Total from investment operations .. 0.19 0.10 0.75 0.84 0.55 1.33
-------- --------- -------- -------- ------- -------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income .......... (0.32) (0.61) (0.61) (0.60) (0.60) (0.60)
Distributions from net realized
gain on investments ............... -- (0.05) -- -- -- --
-------- --------- -------- -------- ------- -------
Total distributions ............... (0.32) (0.66) (0.61) (0.60) (0.60) (0.60)
-------- --------- -------- -------- ------- -------
Net increase (decrease) in net asset value (0.13) (0.56) 0.14 0.24 (0.05) 0.73
-------- --------- -------- -------- ------- -------
Net Asset Value, End of Period ............ $ 9.58 $ 9.71 $ 10.27 $ 10.13 $ 9.89 $ 9.94
======== ========= ======== ======== ======= =======
TOTAL RETURN(1) ........................... 1.83% 1.02% 7.66% 8.84% 5.76% 14.89%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ... $140,288 $ 133,408 $160,561 $120,532 $79,211 $70,490
Ratios of expenses to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 0.94% 0.93% 0.96% 1.02% 1.10% 1.54%
After reimbursement of expenses
by Adviser(2) ..................... 0.78% 0.80% 0.80% 0.80% 0.80% 0.80%
Ratios of net investment income
to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 6.42% 5.91% 5.79% 6.02% 5.89% 5.78%
After reimbursement of expenses
by Adviser(2) ..................... 6.58% 6.04% 5.95% 6.24% 6.19% 6.52%
Portfolio Turnover(1) .................. 30.30% 49.83% 45.29% 17.76% 41.75% 68.24%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
70
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/CHICAGO TRUST MUNICIPAL BOND FUND
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
---------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ....... $ 9.73 $ 10.36 $ 10.19 $ 10.06 $ 10.08 $ 9.56
------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................. 0.24 0.46 0.44 0.38 0.38 0.35
Net realized and unrealized gain
(loss) on investments .............. (0.02) (0.63) 0.17 0.12 (0.02) 0.52
------- ------- ------- ------- ------- -------
Total from investment operations ... 0.22 (0.17) 0.61 0.50 0.36 0.87
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Distributions from and in excess
of net investment income ........... (0.26) (0.46) (0.44) (0.37) (0.38) (0.35)
------- ------- ------- ------- ------- -------
Total distributions ................ (0.26) (0.46) (0.44) (0.37) (0.38) (0.35)
------- ------- ------- ------- ------- -------
Net increase (decrease) in net asset value . (0.04) (0.63) 0.17 0.13 (0.02) 0.52
------- ------- ------- ------- ------- -------
Net Asset Value, End of Period ............. $ 9.69 $ 9.73 $ 10.36 $ 10.19 $ 10.06 $ 10.08
======= ======= ======= ======= ======= =======
TOTAL RETURN(1) ............................ 2.23% (1.77)% 6.17% 5.13% 3.59% 9.29%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) .... $16,035 $17,219 $13,210 $12,379 $11,186 $11,679
Ratios of expenses to average net assets:
Before reimbursement of expenses
by Adviser(2) ...................... 1.16% 1.20% 1.41% 1.64% 1.53% 2.16%
After reimbursement of expenses
by Adviser(2) ...................... 0.10% 0.10% 0.35%(3) 0.90% 0.90% 0.90%
Ratios of net investment income
to average net assets:
Before reimbursement of expenses
by Adviser(2) ...................... 3.74% 3.45% 3.22% 3.00% 3.11% 2.37%
After reimbursement of expenses
by Adviser(2) ...................... 4.80% 4.55% 4.28% 3.74% 3.74% 3.63%
Portfolio Turnover(1) ................... 44.13% 22.83% 34.33% 16.19% 27.47% 42.81%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
(3) The Advisor's expense reimbursement level, which affects the net expense
ratio, changed from 0.90% to 0.10% on February 27, 1998.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
71
<PAGE>
ALLEGHANY FUNDS
-------------------
ALLEGHANY/CHICAGO TRUST MONEY MARKET FUND APRIL 30, 2000
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
ALLEGHANY/CHICAGO TRUST MONEY MARKET FUND
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR YEAR YEAR YEAR YEAR
04/30/00 ENDED ENDED ENDED ENDED ENDED
(UNAUDITED) 10/31/99 10/31/98 10/31/97 10/31/96 10/31/95
---------- ---------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ...... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................ 0.03 0.05 0.05 0.05 0.05 0.03
-------- -------- -------- -------- -------- --------
Less distributions from
net investment income ............. (0.03) (0.05) (0.05) (0.05) (0.05) (0.03)
-------- -------- -------- -------- -------- --------
Net Asset Value, End of Period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN(1) ........................... 2.71% 4.76% 5.24% 5.15% 5.14% 5.56%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Period (in 000's) ... $391,588 $335,140 $281,389 $238,551 $225,536 $206,075
Ratios of expenses to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 0.50% 0.51% 0.52% 0.56% 0.59% 0.63%
After reimbursement of expenses
by Adviser(2) ..................... 0.50% 0.51% 0.51%(4) 0.50% 0.50% 0.43%(3)
Ratios of net investment income
to average net assets:
Before reimbursement of expenses
by Adviser(2) ..................... 5.37% 4.63% 5.13% 5.00% 4.93% 5.24%
After reimbursement of expenses
by Adviser(2) ..................... 5.37% 4.63% 5.14% 5.06% 5.02% 5.44%
</TABLE>
-------------------
(1) Not Annualized.
(2) Annualized.
(3) The Advisor's expense reimbursement level, which affects the net expense
ratio, changed from 0.40% to 0.50% on July 12, 1995.
(4) As of February 27, 1998, the Adviser no longer waived fees or reimbursed
expenses.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
72
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
--------------------------------------------------------------------------------
NOTE (A) SIGNIFICANT ACCOUNTING POLICIES: Alleghany Funds (the "Company")
operates as a series company; twelve series are covered by these financial
statements: Alleghany/Montag & Caldwell Growth Fund (the "Growth Fund"),
Alleghany/Chicago Trust Growth & Income Fund (the "Growth & Income Fund"),
Alleghany/Chicago Trust Talon Fund (the "Talon Fund"), Alleghany/Chicago Trust
Small Cap Value Fund (the "Small Cap Value Fund"), Alleghany/Veredus Aggressive
Growth Fund (the "Aggressive Growth Fund"), Alleghany/Blairlogie International
Developed Fund (the "International Developed Fund"), Alleghany/Blairlogie
Emerging Markets Fund (the "Emerging Markets Fund"), Alleghany/Montag & Caldwell
Balanced Fund (the "M&C Balanced Fund"), Alleghany/Chicago Trust Balanced Fund
(the "CT Balanced Fund"), Alleghany/Chicago Trust Bond Fund (the "Bond Fund"),
Alleghany/Chicago Trust Municipal Bond Fund (the "Municipal Bond Fund") and
Alleghany/Chicago Trust Money Market Fund (the "Money Market Fund") (each a
"Fund" and collectively, the "Funds"). The Company is an open-end management
investment company registered under the Investment Company Act of 1940, as
amended (the "Act") and was organized as a Delaware business trust on September
10, 1993.
After the close of business on April 30, 1999, pursuant to an agreement and plan
of reorganization in a tax-free business combination, the assets and liabilities
of PIMCO Emerging Markets Fund and PIMCO International Developed Fund (the
"Acquired Funds") were transferred to the newly formed series of the Company,
Alleghany/Blairlogie Emerging Markets Fund and Alleghany/Blairlogie
International Developed Fund (the "Acquiring Funds"), in exchange for shares of
the Acquiring Funds. Holders of the Institutional class of shares of the
Acquired Funds received Class I Shares of the corresponding Acquiring Fund and
holders of the Administrative Class of the Acquired Fund received Class N Shares
of the corresponding Acquiring Fund. In addition, at the date of transfer for
Alleghany/Blairlogie Emerging Markets Fund, 39,668 Class A Shares, 21,554 Class
B Shares and 31,837 Class C Shares converted to 39,559, 21,149 and 31,255 Class
N Shares of the Acquiring Fund at conversion rates of 0.99724, 0.98121 and
0.98170, respectively. At the date of transfer for Alleghany/Blairlogie
International Developed Fund 75,505 Class A Shares, 122,227 Class B Shares and
221,270 Class C Shares converted to 75,200, 119,741 and 216,942 Class N Shares
of the Acquiring Fund at conversion rates of 0.99597, 0.97966, 0.98044,
respectively. Prior year share information has been restated to reflect the
share conversions at April 30, 1999.
The Growth Fund seeks long-term capital appreciation consistent with investments
primarily in a combination of equity and convertible securities. Capital
appreciation is emphasized, and generation of income is secondary. Montag &
Caldwell, Inc. ("Montag & Caldwell") is the Adviser for the Fund, which
commenced investment operations on November 2, 1994. Effective June 28, 1996,
the Fund offers two classes of shares: Class I (Institutional) Shares and Class
N (Retail) Shares.
The Growth & Income Fund seeks long-term total return through a combination of
capital appreciation and current income. In seeking to achieve its investment
objective, the Fund invests primarily in common stocks, preferred stocks and
convertible securities. The Chicago Trust Company ("Chicago Trust") is the
Adviser for the Fund, which commenced investment operations on December 13,
1993.
The Talon Fund seeks long-term total return through capital appreciation. The
Fund invests primarily in stocks of companies believed by Talon Asset
Management, Inc. ("Talon") to have prospects for long-term growth. The Fund,
which commenced investment operations on September 19, 1994, may also invest in
preferred stock and debt securities, including those which may be convertible
into common stock. Chicago Trust is the Adviser for the Fund and Talon is the
Sub-Adviser.
The Small Cap Value Fund seeks long-term total return by investing primarily in
common stocks of small U.S. companies and/or real estate investment trusts
(REITs). Chicago Trust is the Adviser for the Fund, which commenced investment
operations on November 10, 1998.
The Aggressive Growth Fund seeks to provide capital appreciation by investing
primarily in equity securities of companies with accelerating earnings. Veredus
Asset Management LLC is the Adviser for the Fund, which commenced investment
operations on June 30, 1998.
The International Developed Fund seeks long-term growth of capital through
investment primarily in a diversified portfolio of international equity
securities. Blairlogie Capital Management ("Blairlogie") is the Adviser for the
Fund, which commenced investment operations on June 8, 1993. The Fund offers two
classes of shares: Class I (Institutional) Shares and Class N (Retail) Shares.
The Emerging Markets Fund seeks long-term growth of capital with investments
primarily in common stocks of companies located in emerging market countries.
Blairlogie is the Adviser for the Fund, which commenced investment operations on
June 1, 1993. The Fund offers two classes of shares: Class I (Institutional)
Shares and Class N (Retail) Shares.
The M&C Balanced Fund seeks long-term total return through investment primarily
in a combination of equity, fixed income and short-term securities. The
allocation between asset classes may vary in accordance with the expected rates
of return of each
73
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
asset class; however, primary emphasis is placed upon selection of particular
investments as opposed to allocation of assets. Montag & Caldwell is the Adviser
for the Fund, which commenced investment operations on November 2, 1994.
Effective December 31, 1998, the Fund offers two classes of shares: Class I
(Institutional) Shares and Class N (Retail) Shares.
The CT Balanced Fund seeks growth of capital with current income. The Fund seeks
to achieve this objective by holding a combination of equity and fixed income
securities, including common stocks (both dividend and non-dividend paying),
preferred stocks, convertible preferred stocks, fixed income securities,
including bonds and bonds convertible into common stocks, and short-term
interest-bearing obligations. Chicago Trust is the Adviser for the Fund, which
commenced investment operations on September 21, 1995.
The Bond Fund seeks high current income consistent with prudent risk of capital.
The Fund primarily invests in a broad range of bonds and other fixed income
securities (bonds and debentures) with an average weighted portfolio maturity
between three and ten years. Chicago Trust is the Adviser for the Fund, which
commenced investment operations on December 13, 1993.
The Municipal Bond Fund seeks a high level of current interest income exempt
from federal income taxes consistent with the conservation of capital. The Fund
seeks to achieve its objective by investing substantially all of its assets in a
diversified portfolio of municipal debt obligations. Chicago Trust is the
Adviser for the Fund, which commenced investment operations on December 13,
1993.
The Money Market Fund seeks to provide as high a level of current interest
income as is consistent with maintaining liquidity and stability of principal.
The Fund seeks to achieve its objective by investing in short-term, high
quality, U.S. dollar-denominated money market instruments. Chicago Trust is the
Adviser for the Fund, which commenced investment operations on December 14,
1993.
The following is a summary of the significant accounting policies consistently
followed by each Fund in the preparation of its financial statements. These
policies are in conformity with generally accepted accounting principles.
(1) SECURITY VALUATION: For the Growth Fund, the Growth & Income Fund, the Talon
Fund, the Small Cap Value Fund, the Aggressive Growth Fund, the International
Developed Fund, the Emerging Markets Fund, the M&C Balanced Fund and the CT
Balanced Fund, equity securities and index options traded on a national exchange
and over-the-counter securities listed on the NASDAQ National Market System are
valued at the last reported sales price at the close of the respective exchange.
Securities for which there have been no sales on the valuation date are valued
at the mean of the last reported bid and asked prices on their principal
exchange. Over-the-counter securities not listed on the NASDAQ National Market
System are valued at the mean of the current bid and asked prices. For the M&C
Balanced Fund, the CT Balanced Fund, the Bond Fund and the Municipal Bond Fund,
fixed income securities, except short-term investments, are valued on the basis
of prices provided by a pricing service when such prices are believed by the
Adviser to reflect the fair market value of such securities in accordance with
guidelines adopted. When fair market value quotations are not readily available,
securities and other assets are valued at fair value by or under the direction
of the Board of Trustees. For all Funds, short-term investments, that is, those
with a remaining maturity of 60 days or less, are valued at amortized cost,
which approximates market value. Foreign securities are converted to United
States dollars using exchange rates at the close of the New York Stock Exchange.
For the Money Market Fund, all securities are valued at amortized cost, which
approximates market value. Under the amortized cost method, discounts and
premiums are accreted and amortized ratably to maturity and are included in
interest income.
(2) REPURCHASE AGREEMENTS: Each Fund may enter into repurchase agreements with
financial institutions deemed to be creditworthy by the Fund's Adviser, subject
to the seller's agreement to repurchase and the Fund's agreement to resell such
securities at a mutually agreed upon price. Securities purchased subject to
repurchase agreements are deposited with the Fund's custodian and, pursuant to
the terms of the repurchase agreement, must have an aggregate market value
greater than or equal to the repurchase price plus accrued interest at all
times. If the value of the underlying securities falls below the value of the
repurchase price plus accrued interest, the Fund will require the seller to
deposit additional collateral by the next business day. If the request for
additional collateral is not met, or the seller defaults on its repurchase
obligation, the Fund has the right to sell the underlying securities at market
value and may claim any resulting loss against the seller.
(3) DERIVATIVE FINANCIAL INSTRUMENTS: The Growth Fund, the Growth & Income Fund,
the Talon Fund, the Aggressive Growth Fund, the International Developed Fund,
the Emerging Markets Fund, the M&C Balanced Fund, the CT Balanced Fund, the Bond
Fund and the Municipal Bond Fund are authorized to utilize derivative financial
instruments. A derivative financial instrument in very general terms refers to a
security whose value is "derived" from the value of an underlying asset,
reference rate or index. A Fund has a variety of reasons to use derivative
instruments, such as to attempt to protect the Fund against possible changes in
the market value of its portfolio and to manage the
74
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
portfolio's effective yield, maturity and duration. All of a Fund's portfolio
holdings, including derivative instruments, are marked to market each day with
the change in value reflected in the unrealized appreciation/depreciation on
investments. Upon disposition, a realized gain or loss is recognized
accordingly, except for exercised option contracts where the recognition of gain
or loss is postponed until the disposal of the security underlying the option
contract. Summarized in (4) and (5) below are specific derivative instruments
used by the Funds listed above.
(4) FUTURES AND OPTIONS: A Fund may use futures contracts to manage its exposure
to the markets or to movements in interest rates and currency values. The
primary risks associated with the use of futures contracts and options are an
imperfect correlation between the change in market value of the securities held
by a Fund and the prices of futures contracts and options, the possibility of an
illiquid market and the inability of the counterparty to meet the terms of the
contract. Futures contracts and purchased options are valued based upon their
quoted daily settlement prices. The premium received for a written option is
recorded as an asset with an equal liability which is marked to market based on
the option's quoted daily settlement price. Fluctuations in the value of such
instruments are recorded as unrealized appreciation (depreciation) until
terminated, at which time realized gains and losses are recognized.
(5) FORWARD CURRENCY TRANSACTIONS: Forward foreign exchange contracts are used
to hedge against foreign exchange risk arising from the Fund's investment or
anticipated investment in securities denominated in foreign currencies. A Fund
may also enter into these contracts for purposes of increasing exposure to a
foreign currency or to shift exposure to foreign currency fluctuations from one
country to another. All commitments are marked to market daily at the applicable
translation rates and any resulting unrealized gains or losses are recorded.
Realized gains or losses are recorded at the time the forward contract matures
or by delivery of the currency. Risks may arise upon entering these contracts
from the potential inability of counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign currency
relative to the U.S. dollar.
(6) MORTGAGE-BACKED SECURITIES: The Growth & Income Fund, the International
Developed Fund, the Emerging Markets Fund, the M&C Balanced Fund, the CT
Balanced Fund, the Bond Fund and the Municipal Bond Fund may invest in
mortgage-backed securities (MBS), representing interests in pools of mortgage
loans. These securities provide shareholders with payments consisting of both
principal and interest as the mortgages in the underlying mortgage pools are
paid. Most of the securities are guaranteed by federally sponsored agencies such
as Government National Mortgage Association (GNMA), Federal National Mortgage
Association (FNMA) or Federal Home Loan Mortgage Corporation (FHLMC). However,
some securities may be issued by private, non-government corporations. MBS
issued by private agencies are not government securities and are not directly
guaranteed by any government agency. They are secured by the underlying
collateral of the private issuer. Yields on privately issued MBS tend to be
higher than those of government backed issues. However, risk of loss due to
default and sensitivity to interest rate fluctuations are also higher.
The Growth & Income Fund, the Aggressive Growth Fund, the International
Developed Fund, the Emerging Markets Fund, the M&C Balanced Fund, the CT
Balanced Fund, the Bond Fund and the Municipal Bond Fund may also invest in
collateralized mortgage obligations (CMOs) and real estate mortgage investment
conduits (REMICs). A CMO is a bond which is collateralized by a pool of MBS, and
a REMIC is similar in form to a CMO. These MBS pools are divided into classes
with each class having its own characteristics. The different classes are
retired in sequence as the underlying mortgages are repaid. A planned
amortization class (PAC) is a specific class of mortgages, which over its life
will generally have the most stable cash flows and the lowest prepayment risk.
Prepayment may shorten the stated maturity of the CMO and can result in a loss
of premium, if any has been paid.
The CT Balanced Fund and the Bond Fund may utilize interest only (IO) securities
to increase the diversification of the portfolio and manage risk. An IO security
is a class of MBS representing ownership in the cash flows of the interest
payments made from a specified pool of MBS. The cash flow on this instrument
decreases as the mortgage principal balance is repaid by the borrower.
(7) INVESTMENT INCOME AND SECURITIES TRANSACTIONS: Dividend income is recorded
on the ex-dividend date, except for certain dividends from foreign securities
where the ex-dividend date may have passed, which are recorded as soon as a Fund
is informed of the ex-dividend date. Interest income is accrued daily.
Securities transactions are accounted for on the date securities are purchased
or sold. The cost of securities sold is determined using the first-in, first-out
method.
(8) FOREIGN CURRENCY: Foreign currencies, investments and other assets and
liabilities are translated into U.S. dollars at the exchange rates prevailing at
the end of the period. Fluctuations in the value of these assets and liabilities
resulting from changes in exchange rates are recorded as unrealized foreign
currency gains (losses). Realized gains (losses) and unrealized appreciation
(depreciation) on investment securities and income and expenses are translated
on the respective dates of such transactions. The effect of changes in foreign
currency exchange rates on investments in securities are not segregated in the
statement of operations from the effects of changes in market prices of those
securities, but are included with the net realized and unrealized gain or loss
on investment securities.
75
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
(9) FEDERAL INCOME TAXES: The Funds have elected to be treated as "regulated
investment companies" under Subchapter M of the Internal Revenue Code and to
distribute substantially all of their respective net taxable income.
Accordingly, no provisions for federal income taxes have been made in the
accompanying financial statements. The Funds intend to utilize provisions of the
federal income tax laws which allow them to carry a realized capital loss
forward for eight years following the year of the loss and offset such losses
against any future realized capital gains. At October 31, 1999, the losses
amounted to $1,272,314 for the Small Cap Value Fund, which will expire October
31, 2007, $791,465 for the Aggressive Growth Fund, which will expire October 31,
2006, $17,153,823 for the Emerging Markets Fund, which will expire between
October 31, 2002 and October 31, 2006, $384,988 for the Bond Fund, which will
expire October 31, 2007, and $10,230 for the Municipal Bond Fund, which will
expire October 31, 2003.
Net realized gains or losses may differ for financial and tax reporting purposes
for the Small Cap Value Fund, the Aggressive Growth Fund, the International
Developed Fund, the Emerging Markets Fund, the M&C Balanced Fund and the Bond
Fund, primarily as a result of losses from wash sales which are not recognized
for tax purposes until the corresponding shares are sold.
(10) DIVIDENDS AND DISTRIBUTIONS: Dividends and distributions to shareholders
are recorded on the ex-dividend date.
(11) MULTI-CLASS OPERATIONS: With respect to the Growth Fund, the International
Developed Fund, the Emerging Markets Fund and the M&C Balanced Fund, each class
offered by these Funds has equal rights as to assets. Income, non-class specific
expenses and realized and unrealized capital gains and losses are allocated to
each class of shares based on the relative net assets of each class.
(12) ORGANIZATION COSTS: The Funds have reimbursed the Advisers for certain
costs incurred in connection with the Funds' and the Company's organization. The
costs were being amortized on a straight-line basis over five years, commencing
on November 2, 1994 for the Growth Fund and the M&CBalanced Fund, September 21,
1995 for the CT Balanced Fund and June 30, 1998 for the Aggressive Growth Fund.
(13) USE OF ESTIMATES: The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
NOTE (B) DIVIDENDS FROM NET INVESTMENT INCOME AND DISTRIBUTIONS OF CAPITAL
GAINS: With respect to the Growth Fund, the Growth & Income Fund, the Talon
Fund, the Small Cap Value Fund, the Aggressive Growth Fund, the M&C Balanced
Fund and the CT Balanced Fund, dividends from net investment income are
distributed quarterly and net realized gains from investment transactions, if
any, are distributed to shareholders annually. With respect to the International
Developed Fund and the Emerging Markets Fund, dividends from net investment
income and net realized gains from investment transactions, if any, are
distributed to shareholders annually. The Bond Fund distributes net investment
income to shareholders monthly and capital gains, if any, are distributed
annually. Prior to April 14, 2000, the Municipal Bond Fund declared and
distributed its net investment income monthly. Effective April 14, 2000, the
Municipal Bond Fund declares dividends daily and pays net investment income
monthly and net realized gains, if any, annually. The Money Market Fund declares
dividends daily from its net investment income. The Money Market Fund's
dividends are payable monthly and are automatically reinvested in additional
Fund shares, at the month-end net asset value, for those shareholders that have
elected the reinvestment option. Differences in dividends per share between
classes of the Growth Fund, the Growth & Income Fund, the International
Developed Fund, the Emerging Markets Fund and the M&C Balanced Fund are due to
different class expenses. In January 2000, the Funds provided tax information to
shareholders for the 1999 calendar year.
Net investment income and realized gains and losses for federal income tax
purposes may differ from that reported on the financial statements because of
permanent book and tax basis differences. Distributions from net realized gains
for book purposes may include short-term capital gains, which are included as
ordinary income for tax purposes.
NOTE (C) SHARES OF BENEFICIAL INTEREST: Each Fund is authorized to issue an
unlimited number of shares of beneficial interest with no par value.
76
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
NOTE (D) INVESTMENT TRANSACTIONS: Aggregate purchases and proceeds from sales of
investment securities (other than short-term investments) for the six months
ended April 30, 2000 were:
<TABLE>
<CAPTION>
AGGREGATE PURCHASES PROCEEDS FROM SALES
U.S. GOVERNMENT OTHER U.S. GOVERNMENT OTHER
--------------- -------------- --------------- ------------
<S> <C> <C> <C> <C>
Growth Fund ............. $ -- $1,067,716,479 $ -- $904,488,746
Growth & Income Fund .... -- 86,522,824 -- 66,072,622
Talon Fund .............. -- 9,833,246 -- 12,160,912
Small Cap Value Fund .... -- 52,963,889 -- 53,706,413
Aggressive Growth Fund .. -- 178,403,924 -- 123,794,638
International Developed
Fund ................ -- 26,262,312 -- 67,739,390
Emerging Markets Fund ... -- 3,471,193 -- 5,881,454
M&C Balanced Fund ....... 17,129,945 120,149,983 17,323,033 56,564,634
CT Balanced Fund ........ 15,370,634 41,622,113 10,405,442 41,367,031
Bond Fund ............... 24,407,204 20,960,160 28,564,235 10,721,897
Municipal Bond Fund ..... -- 7,068,109 -- 8,944,889
</TABLE>
NOTE (E) ADVISORY, ADMINISTRATION AND DISTRIBUTION SERVICES AGREEMENTS: Under
various Advisory Agreements with the Funds, each Adviser provides investment
advisory services to the Funds. The Funds will pay advisory fees at the
following annual percentage rates of the average daily net assets of each Fund:
0.80% on the first $800,000,000 of average daily net assets and 0.60% of average
daily net assets over $800,000,000 for the Growth Fund, 0.70% for the Growth &
Income Fund; 0.80% for the Talon Fund; 1.00% for the Small Cap Value Fund; 1.00%
for the Aggressive Growth Fund; 0.85% for the International Developed Fund;
0.85% for the Emerging Markets Fund; 0.75% for the M&C Balanced Fund; 0.70% for
the CT Balanced Fund; 0.55% for the Bond Fund; 0.60% for the Municipal Bond
Fund; and 0.40% for the Money Market Fund. These fees are accrued daily and paid
monthly.
For the one year period ending December 31, 2000, the Advisers have
contractually undertaken to reimburse the Talon Fund, the Small Cap Value Fund,
the Aggressive Growth Fund, the International Developed Fund (Class I and Class
N), the Emerging Markets Fund (Class I and Class N), and the Bond Fund, for
operating expenses which cause total expenses to exceed 1.30%, 1.40%, 1.40%,
1.10%, 1.35%, 1.35%, 1.60%, and 0.74%, respectively. With respect to the Bond
Fund, prior to February 15, 2000, total expenses were capped at 0.80%. The
Advisers have voluntarily undertaken to reimburse the Growth Fund (Class I and
Class N), the Growth & Income Fund, the M&C Balanced Fund (Class I and Class N),
the CT Balanced Fund and the Municipal Bond Fund for operating expenses which
cause total expenses to exceed 0.98%, 1.30%, 1.10%, 1.00%, 1.25%, 1.10%, and
0.10% respectively. The voluntary expense reimbursements may be terminated at
the discretion of the Advisers.
For the six months ended April 30, 2000, the Advisers waived/reimbursed expenses
of $19,258 for the Talon Fund, $19,925 for the Small Cap Value Fund, $31,010 for
the Aggressive Growth Fund, $23,268 for the International Developed Fund,
$37,790 for the Emerging Markets Fund, $111,890 for the Bond Fund and $88,324
for the Municipal Bond Fund.
Alleghany Investment Services Inc. ("AIS") serves as Administrator of the Funds.
For services provided, AIS receives the following fees:
<TABLE>
<CAPTION>
ADMINISTRATION FEES CUSTODY LIAISON FEES
------------------- --------------------
AVERAGE
-------
FEE (% OF FUNDS' AGGREGATE DAILY NET ANNUAL FEE AVERAGE DAILY NET ASSETS
-------------------------- --------- ---------- ------------------------
DAILY NET ASSETS) ASSETS (PER FUND) (PER FUND)
---------------- ------ ---------- ----------
<S> <C> <C> <C> <C>
0.060 up to $2 billion $10,000 up to $100 million
0.050 $2 billion to $7 billion $15,000 $100 million to $500 million
0.045 over $7 billion $20,000 over $500 million
</TABLE>
PFPC Inc. ("PFPC"), formerly First Data Investor Services Group, Inc., serves as
Sub-Administrator of the Funds and receives fees, which are paid to PFPC by the
Administrator. Effective April 1, 2000, fees are based upon the following
schedule:
SUB-ADMINISTRATION FEES CUSTODY LIAISON FEES
----------------------- --------------------
FEE (% OF FUNDS' AGGREGATE AVERAGE DAILY ANNUAL FEE
-------------------------- ------------- ----------
DAILY NET ASSETS) NET ASSETS (PER FUND)
----------------- ---------- ---------
0.045 up to $2 billion $10,000
0.040 $2 billion to $3 billion
0.030 $3 billion to $8 billion
0.025 $8 billion to $12 billion
0.020 over $12 billion
Prior to April 1, 2000, PFPC received fees as follows:
<TABLE>
<CAPTION>
SUB-ADMINISTRATION FEES CUSTODY LIAISON FEES
----------------------- --------------------
AVERAGE
-------
FEE (% OF FUNDS' AGGREGATE DAILY NET ANNUAL FEE AVERAGE DAILY NET ASSETS
-------------------------- --------- ---------- ------------------------
DAILY NET ASSETS) ASSETS (PER FUND) (PER FUND)
---------------- ------ ---------- ----------
<S> <C> <C> <C> <C>
0.060 up to $2 billion $10,000 up to $100 million
0.045 $2 billion to $3.5 billion $15,000 $100 million to $500 million
0.040 over $3.5 billion $20,000 over $500 million
</TABLE>
Provident Distributors, Inc. serves as principal underwriter and distributor of
the Funds' shares. Pursuant to a Rule 12b-1 distribution plan (the "Plan")
adopted by the Funds with respect to Class N Shares, the Growth Fund, the Growth
& Income Fund, the Talon Fund, the Small Cap Value Fund, the Aggressive Growth
Fund, the International Developed Fund, the Emerging Markets Fund, the M&C
Balanced Fund, the CT Balanced Fund, the Bond Fund and the Municipal Bond Fund
pay certain expenses associated with the distribution of their shares. Under the
Plan, each Fund may pay actual expenses not exceeding, on an annual basis, 0.25%
of each participating Fund's average daily net assets. The Class I Shares of the
Growth Fund, the International Developed Fund, the Emerging Markets Fund and the
M&C Balanced Fund and the Class N Shares of the Money Market Fund do not have
distribution plans.
77
<PAGE>
ALLEGHANY FUNDS
-------------------
APRIL 30, 2000
NOTES TO FINANCIAL STATEMENTS - CONTINUED (UNAUDITED)
--------------------------------------------------------------------------------
For the six months ended April 30, 2000, the class specific expenses were:
REPORTS TO
TRANSFER AGENT FEES SHAREHOLDER EXPENSE
------------------- -------------------
CLASS N CLASS I CLASS N CLASS I
------- ------- ------- -------
Growth Fund .................... $248,082 $ -- $58,311 $22,667
International Developed Fund ... -- -- 363 4,463
Emerging Markets Fund .......... -- -- 118 921
M&C Balanced Fund .............. 4,171 -- 3,934 2,029
Certain officers and Trustees of the Company are also officers and directors of
Chicago Trust. The Company does not compensate its officers or affiliated
Trustees. Effective January 1, 2000, the Company pays each unaffiliated Trustee
$3,500 per Board of Trustees' meeting attended and an annual retainer of $3,500
and reimburses each unaffiliated Trustee for out-of-pocket expenses.
NOTE (F) SUBSEQUENT EVENTS: Alleghany/Veredus SciTech Fund is currently in
registration with the Securities and Exchange Commission with an anticipated
commencement date on or about June 30, 2000.
78
<PAGE>
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<PAGE>
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<PAGE>
GUIDE TO SHAREHOLDER BENEFITS
--------------------------------------------------------------------------------
We're delighted to offer all Alleghany Funds shareholders a variety of services
and convenient options. To receive more information about any of these benefits,
simply call a Shareholder Services Representative Monday through Friday, 9 a.m.
- 7 p.m. ET.
THE EASY WAY TO GROW YOUR ACCOUNT: START AN AUTOMATIC INVESTMENT PLAN(1)
Systematic investing is an easy, effortless way to help reach any investment
goal. Just choose a fixed amount, and we'll automatically deduct it from your
checking or savings account on a regular schedule and invest it in your
Alleghany Funds account. The service is free, and the minimum initial investment
is $50.
COMPOUND YOUR EARNINGS WITH AUTOMATIC DIVIDEND REINVESTMENT
By automatically reinvesting dividends into your Alleghany Funds account, your
profits can mount. Monthly and quarterly dividends and annual capital gain
distributions are reinvested at no charge.
FREE, FLEXIBLE EXCHANGE PRIVILEGES
As your personal needs change, so can your Alleghany Funds investment. Transfers
between our funds are free of charge, and it only takes a telephone call.
LOW MINIMUM INITIAL INVESTMENTS
The minimum initial investment for all Alleghany Funds is just $2,500 ($500 for
IRAs). And subsequent investments can be as low as $50.
FREE CHECK WRITING SERVICES AVAILABLE
If you are an investor in Alleghany/Chicago Trust Money Market Fund, you can
take advantage of free check writing privileges. Checks must be written for $500
or more.
ACCESS INFORMATION AND MAKE TRANSACTIONS ONLINE AT OUR WEB SITE
You can access account balances, obtain fund information and make transactions
online 24 hours a day, 7 days a week -- in complete security. Alleghany Funds
was among the first mutual fund companies to provide these capabilities.
(1) Periodic investment plans involve continuous investments in securities
regardless of price. You should consider your financial ability to continue
to purchase shares through periods of both high and low price levels. This
plan does not assure a profit and does not protect against loss in declining
markets.
--------------------------------------------------------------------------------
www.AlleghanyFunds.com
--------------------------------------------------------------------------------
Our Shareholder Services Line Is at Your Service 24 Hours a Day
--------------------------------------------------------------------------------
800 992-8151
Shareholder Services Representatives are available to assist you Monday - Friday
9 a.m. to 7 p.m., ET. Or, call any time, day or night, for automated account
information to make exchanges or check fund performance.
<PAGE>
[GRAPHIC OF ALLEGHANY FUNDS LOGO OMITTED]
--------
TRUSTEES
--------------------------------------------------------------------------------
Leonard F. Amari*
Stuart D. Bilton, Chairman
Dorothea C. Gilliam
Robert Kushner*
Gregory T. Mutz*
Robert Scherer*
Nathan Shapiro*
Denis Springer*
*UNAFFILIATED TRUSTEE
--------
ADVISORS
--------------------------------------------------------------------------------
The Chicago Trust Company
171 North Clark Street
Chicago, IL 60601
Montag & Caldwell, Inc.
3455 Peachtree Road, NE, Suite 1200
Atlanta, GA 30326
Veredus Asset Management LLC
6900 Bowling Boulevard, Suite 250
Louisville, KY 40207
Blairlogie Capital Management
125 Princes Street
Edinburgh EH2 4AD
Scotland
--------------------
SHAREHOLDER SERVICES
--------------------------------------------------------------------------------
PFPC Inc.
4400 Computer Drive
Westborough, MA 01581
-----------
DISTRIBUTOR
--------------------------------------------------------------------------------
Provident Distributors, Inc.
3200 Horizon Drive
King of Prussia, PA 19406
--------
OFFICERS
--------------------------------------------------------------------------------
Kenneth C. Anderson, President
Debra Bunde Reams, Vice President
Gerald F. Dillenburg, Vice President,
Secretary and Treasurer
Laura M. Hlade, Assistant Treasurer
---------
CUSTODIAN
--------------------------------------------------------------------------------
Bankers Trust
One Bankers Trust Place
New York, NY 10001
State Street Bank and Trust
801 Pennsylvania Avenue
Kansas City, MO 64105
-------------
LEGAL COUNSEL
--------------------------------------------------------------------------------
Vedder, Price, Kaufman & Kammholz
222 N. LaSalle Street
Chicago, IL 60601
-------
AUDITOR
--------------------------------------------------------------------------------
KPMG LLP
303 East Wacker Drive
Chicago, IL 60601
THIS REPORT IS SUBMITTED FOR GENERAL INFORMATION TO THE SHAREHOLDERS OF THE
FUNDS. IT IS NOT AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE
FUNDS UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS WHICH INCLUDES
DETAILS REGARDING THE FUNDS' OBJECTIVES, POLICIES, EXPENSES AND OTHER
INFORMATION.
AG07 04/30/00
