LETTER FROM THE PRESIDENT
February 28, 1995
Dear TIP Member:
We are pleased to present the Annual Report to Members of the
TIFF Investment Program, Inc. (TIP). As you know, TIP is a family of
multi-manager, commingled funds open exclusively to grantmaking
foundations.
We are pleased to note that, in addition to the five Funds that are
currently operational (described herein), two new Funds have recently been
added to the TIP family: TIFF Multi-Asset Fund and TIFF Global Equity
Fund. All of TIP's Funds enable member foundations to delegate to TIP's
responsibility for the time-intensive tasks of selecting money managers and
other vendors. The Multi-Asset Fund and, to a much lesser extent, the
Global Equity Fund will go beyond this by providing Members with an
opportunity to also delegate to TIP responsibility for the all-important task
of asset allocation. Each Fund will commence operations as soon as adequate
capital commitments have been received.
We are very gratified by the favorable reception that TIP has
received from the foundation community. We are engaged in active
discussions with numerous foundations throughout the United States that
have expressed interest in learning more about TIP, and would welcome the
opportunity to discuss this exciting new initiative with other eligible
investors.
For further information about the TIFF Investment Program, please
call us at 800-984-0084.
Sincerely,
by: \s\David A. Salem
David A. Salem
President
Table of Contents
TIFF U.S. Equity Fund
Overview and Performance Graph 2
Statement of Net Assets 3
TIFF International Equity Fund
Overview and Performance Graph 19
Statement of Net Assets 20
TIFF Emerging Markets Fund
Overview and Performance Graph 33
Statement of Net Assets 34
TIFF Bond Fund
Overview and Performance Graph 47
Statement of Net Assets 48
TIFF Short-Term Fund
Overview and Performance Graph 53
Statement of Net Assets 54
Statement of Operations 56
Statement of Changes in Net Assets 58
Financial Highlights 60
Notes to Financial Statements 62
Report of Independent Accountants 74
U.S. Equity Fund
Graph: Comparison of change in value of $10,000 Investment in TIFF U.S. Equity
and the Wilshire 5000 Stock Index where the X-axis extends from 5/31/94 to
12/31/94 and the Y-axis extends from $9,700 to $10,500.
Performance Evaluation
From inception (5/31/94) through 12/31/94, the
TIFF U.S. Equity Fund had a total return net of expenses of 3.5%. The
return for its benchmark, the Wilshire 5000, over the same time period was
1.8%. The fund's strong relative performance during 4Q 1994 boosted the
margin by which it has outperformed the Wilshire 5000 since inception from
40 bp to 170 bp. While it is too soon to draw conclusions about the
effectiveness of the fund's structure or evolving strategies, it is pleasing
that its distinctive structure has, thus far, worked in the intended manner.
The fund's structure is distinctive not because it entails broad
diversification across all market sectors - most multi-manager structures do
this - but because it does so by combining relatively aggressive active
strategies with a low cost "completeness" portfolio. The completeness
portfolio obviates the problem of paying active manager fees on stocks held
solely for diversification purposes. The operative premise is that in any
given time period one, or at most a few, of the fund's active managers will
produce sizeable excess returns which, when coupled with market-like results
produced (on average) by the fund's residual holdings, will produce a
modest return advantage over the Wilshire 5000: this is precisely what
happened during 4Q 1994, with Palo Alto investors' technology holdings
(which it has since trimmed back) performing particularly well.
Policy Considerations
Long Term - The Fund is designed as a core investment vehicle for that
portion of a foundation's assets committed to U.S. stocks. Accordingly, it
employs a diverse combination of managers and strategies.
Short Term - 1994 was the worst year for bond investors in many decades.
Stocks fell along with bonds during part of the year, but finished the year
stronger, increasing institutional stock ratios in the process. Although last
among the policy choices that collectively constitute long-term asset
allocation, the adoption of sound rebalancing disciplines can boost returns as
much as a fairly large shift in the policy mix itself. Now could be an
opportune time to rebalance asset mixes back toward normal stock/bond
ratios.
TIFF Investment Program, Inc.
TIFF U.S. Equity Fund - Statement Of Net Assets
December 31, 1994
Shares Value+
Long Portfolio - 135.8%
Common Stocks - 68.6%
Basic Materials & Natural Resources - 10.8%
AK Steel Holding Corp.*(b) 810 24,908
Alco Standard Corp. (b) 750 47,063
Alumax Inc.* (b) 810 22,984
Aluminum Co. Of America (b) 440 38,115
Amoco Corp. 500 29,563
Apache Corp. (b) 1,380 34,500
Arco Chemical 2,100 92,400
Ashland Oil Inc. 10,700 369,150
Avery Dennison Corp. 2,200 78,100
Bethlehem Steel Corp.* 4,600 82,800
Cabot Corp. 11,400 323,475
Carpenter Technology 500 28,000
Chesapeake Corp. 1,400 46,200
Chevron Corp. (b) 1,080 48,195
Cytec Industries Inc.* 1,000 39,000
Dexter Corporation (b) 7,900 171,825
Diamond Shamrock Inc. (b) 830 21,476
Dow Chemical Co 2,300 154,675
E I Dupont De Nemours & Co. Inc. (b) 6,550 368,438
Ensys Environmental Products 108,100 432,400
Exxon Corp. (b) 4,170 253,328
Federal Paper Board Inc. 5,300 153,700
Georgia Gulf Corp. (b) 970 37,709
Global Industries Ltd.* 1,000 22,875
Grace, W.R. & Co. 3,000 115,875
Great Lakes Chemical 1,300 74,100
Halliburton Co. (b) 1,060 35,113
Imperial Oil 1,000 33,000
International Paper Co. 400 30,150
J & L Specialty Steel Inc. 1,600 31,400
Jefferson Smurfit Corp.* (b) 2,310 39,270
Lukens Inc. 900 26,213
Mead Corp. (b) 1,060 51,543
Mississippi Chemical* (b) 1,560 27,105
Mobil Corp. 1,790 150,808
Monsanto Co. 2,600 183,300
Murphy Oil Corporation 1,000 42,500
Newfield Exploration Company* 500 9,875
Northwestern Steel and Wire 1,000 6,250
Nucor Corp. 1,300 72,150
Olin Corp. 1,900 97,850
Paragon Trade Brands Inc.* 1,000 13,250
Phelps Dodge Corp. 5,500 340,313
Phillips Petroleum Co. (b) 2,600 85,150
Reynolds Metals Co. 3,100 151,900
Rogers Corp.* 9,000 447,750
Rouge Steel Company 1,100 31,763
Royal Dutch Petroleum Co. - NY 1,000 107,750
Scott Paper Co. (b) 600 41,475
Smith International* (b) 1,520 19,000
Sun Co. Inc. (b) 850 24,438
Temple Inland Inc. 2,400 108,300
Texaco Inc. 2,600 155,675
Texas Industries Inc. 1,000 35,250
The Geon Company 1,000 27,375
Tidewater Inc. 6,400 118,400
Union Camp Corp. 2,500 117,813
Union Texas Petroleum Holdings (b) 1,250 25,938
Unocal Corp. (b) 1,360 37,060
USX-Marathon Group* (b) 16,010 262,164
Vastar Reources Inc. (b) 1,280 31,840
Wellman Inc. 500 14,125
Westvaco Corp. 2,100 82,425
Witco Corp. 1,000 24,625
Zeigler Coal Holding Co. (b) 1,802 21,166
Total 6,272,326
Communications & Technology - 7.1%
Airtouch Communications Inc.* (b) 4,970 144,751
Alltel Corp. (b) 780 23,498
Ameritech Corp. (b) 600 24,225
Arrow Electronics Inc.* 3,600 129,150
AT & T Corp. (b) 7,510 377,378
Bellsouth Corp. 2,300 124,488
BMC Software* 1,100 62,563
Cabletron Systems Inc.* 500 23,250
Capital Cities/ABC Inc. (b) 590 50,298
Checkpoint Systems* 12,500 240,625
Chris-Craft Inds Inc.* 1,000 34,500
Cincinnati Bell Inc. 6,200 103,850
Cisco Systems, Inc.* (b) 1,160 40,745
Cray Research Inc.* 1,000 15,750
Digital Equipment Corp.* (b) 700 23,275
EMC Corp., Mass* (b) 5,480 118,505
General Instrument Corp.* 5,200 156,000
GTE Corp. 7,400 224,775
Hewlett-Packard Inc. (b) 410 40,949
Honeywell Inc. 900 28,350
Int'l Flavors & Fragrances (b) 540 24,975
Intel Corp. 4,100 261,888
International Business Machine (b) 850 62,475
Iwerks Entertainment Inc.* 1,000 4,750
KLA Instruments Corp.* (b) 770 37,730
LIN Broadcasting Corp.* 500 66,750
LSI Logic* (b) 620 25,033
Micron Technology 6,000 264,750
Motorola Inc. (b) 630 36,461
Nextel Communications Inc.-A* 800 11,500
Nynex Corp. 2,500 91,875
Pacific Telesis Group 13,400 381,900
Rochester Tel Corp.* (b) 1,670 35,279
Rockwell International 3,600 128,700
Sprint Corp. 7,400 204,425
Tandem Computers Inc.* (b) 1,470 25,174
Tektronix Inc. (b) 660 22,605
Tele-Communications-Cl A New* (b) 2,290 49,808
Telephone & Data System (b) 2,330 107,471
Vanguard Cellular Systems Inc. (Class A)* (b) 950 24,463
Viacom Inc. Class B* 1,500 60,938
Western Digital* 10,600 177,550
Xerox Corp. (b) 480 47,515
Total 4,140,940
Consumer Durables - 2.0%
Black & Decker Corp. (b) 1,040 24,700
Chrysler Corp. (b) 1,070 52,430
Exide Corp. (b) 950 53,438
Ford Motor Company 14,000 392,000
General Motors Corp. 2,000 84,250
General Motors Corp. Cl H 1,100 38,363
Goodyear Tire & Rubber 7,800 262,275
Harley-Davidson (b) 1,420 39,760
Lear Seating Corp.* (b) 1,410 28,024
Maytag Co. 6,900 103,500
Wabash National Corp. (b) 700 27,300
Williams-Sonoma Inc.* (b) 1,250 37,577
Total 1,143,617
Consumer Non-Durables - 5.5%
Archer Daniels Midland Co. (b) 1,850 38,156
Avon Products Inc. 800 47,800
Boston Chicken Inc.* (b) 620 10,773
Brothers Gourmet Coffees Inc.* 1,000 11,000
Canandaigua Wine Co. Cl A* (b) 740 28,120
Coca-Cola Co. 3,000 154,500
Conagra Inc. (b) 730 22,813
Dean Foods Co. 1,000 29,000
Dr Pepper/7 Up* (b) 1,520 38,950
Eskimo Pie Corp. 15,000 281,250
Gillette Co. (b) 820 61,295
Hormel Geo. A & Co. 600 14,850
IBP Inc. (b) 9,320 281,930
Johnson & Johnson (b) 1,340 73,365
Kellogg Co. (b) 640 37,200
Lancaster Colony Corp. 7,100 208,563
Newell Co. 900 18,900
Opta Food Ingredients Inc.* 11,000 64,625
Philip Morris Comp Cos Inc. 13,600 782,000
Pioneer Hi-Bred Int'L 1,500 51,750
Procter & Gamble Co (b) 7,540 467,480
Smithfield Foods* 1,000 32,000
Starbucks Corp.* 1,000 27,500
Tambrands Inc. 1,000 38,625
Tyson Food Inc. - Cl A 10,800 229,500
UST Inc. 4,500 124,874
Total 3,176,819
Financial - 12.9%
Aetna Life & Casualty 500 23,563
AFLAC Corp. (b) 10,220 327,040
Ahmanson H. F. & Co. 1,700 27,413
Albank Financial Corp. 600 13,950
Allstate Corp. 3,900 92,138
America Premier Underwriters 500 12,938
American Express Co. (b) 1,620 47,790
American Federal Bank 22,000 236,500
American General Corp. 1,000 28,250
American Int'l Group (b) 660 64,680
Amfed Financial Inc. 1,000 22,000
Aon Corporation 7,200 230,400
Astoria Financial Corp.* 1,400 36,750
Bankamerica Corp.* 3,040 120,080
Bank of Boston (b) 1,760 45,540
Bankers Trust NY Corp. 500 27,688
Boston Bancorp 1,000 29,125
Capital Guaranty Corp. 1,000 14,125
Chase Manhattan Corp. 1,600 55,000
Chemical Banking Corp. (b) 5,660 203,053
Cigna Corp. 1,200 76,350
Citicorp (b) 3,580 148,123
CNA Financial Corp.* 500 32,438
Comerica Inc. 12,000 292,500
Dean Witter Discover & Co. 2,300 77,913
Emphesys Financial Group 1,000 31,750
Federal National Mortgage Assoc. 5,700 415,388
First Colony Corp. 1,100 24,613
First Interstate Bancorp (b) 4,960 335,420
First Union Corp. (N.E.) 2,000 82,750
First USA Inc. 1,500 49,313
Firstar Corp. 500 13,438
Firstfed Michigan Corp. 15,000 307,500
General Re Corp. (b) 290 35,888
Glendale Federal Bank * 1,000 9,625
Hartford Steam Boiler 1,900 75,763
Household Int'l Inc. (b) 970 36,011
I T T Corp. 1,100 97,488
Integra Financial Corp. 700 28,788
Jefferson Pilot Corp. (b) 1,310 67,956
JSB Financial 1,000 23,750
Key Corp. (New) 10,700 267,500
Lehman Brothers Holding Inc. 1,900 28,025
Lincoln National Corp. 3,500 122,500
Loews Corp. 400 34,750
MBNA Corp. 900 21,038
Mellon Bank Corp. 1,800 55,125
Mercantile Bancorporation 1,000 31,250
National City Corp. 2,100 54,338
Nationsbank Corporation 2,100 94,763
NBD Bancorp Inc. 2,800 76,650
NWNL Companies Inc. 10,800 313,200
Ohio Casualty Corp. 10,500 296,625
Old Republic Intl Corp. 500 10,625
Peoples Bank Bridgeport 23,000 273,125
Premier Bancorp* 20,000 317,500
Providian Corp. 1,000 30,875
Republic New York Corp. 1,200 54,300
Resource Mortgage Capital Corp. 1,000 10,750
Safeco Corp. 5,000 260,000
San Juan Basin Royalty Trust 63,300 403,538
Security Connecticut Corp. 1,000 22,500
St. Paul Cos. (b) 1,060 47,435
Sunamerica Inc. 4,100 148,625
Suntrust Banks Inc. 1,300 62,075
T R Financial Corp. 1,000 13,125
TIG Holdings Inc. 2,400 45,000
Transamerica Corp. 500 24,875
Transatlantic Holdings Inc. 500 27,938
Travelers Inc.* 8,500 276,250
USF&G Corp. 8,500 115,813
USLife Corp. 1,000 34,875
Washington Mutual Inc. 1,000 16,864
Total 7,512,640
Health & Pharmaceuticals - 4.2%
American Home Products 2,980 186,845
Amgen Inc.* (b) 1,490 87,910
Amsco International Inc.* 1,000 9,125
Arbor Health Care Company* 1,000 20,500
Bausch & Lomb Inc. 500 16,938
Bergen Brunswig Corp. (Class A) 7,000 146,125
Biomet Inc.* (b) 1,730 24,220
Bristol-Myers Squibb Co. 3,400 196,775
Cardinal Health Inc. (b) 650 30,144
Circa Pharmaceuticals Inc.* (b) 1,700 30,388
Columbia/Hca Healthcare Corp. 3,200 116,800
Dentsply International Inc. 1,000 31,500
Eli Lilly & Co. (b) 570 37,406
FHP Group* 1,000 25,750
Forest Labs* 1,000 46,625
Foxmeyer Health Corp.* 500 7,438
Gensia Pharmaceuticals Inc.* 1,000 4,250
Genzyme Corp.-Genl Division* 1,000 31,500
Humana Inc.* (b) 2,130 48,191
Mariner Health Group Inc.* 1,000 21,625
Marion Merrell Dow Inc. 1,000 20,375
Medtronic Inc. (b) 540 30,038
Merck & Co Inc. (b) 9,740 371,338
Multicare Companies Inc.* 1,000 19,750
Mylan Labs Inc. 7,200 194,400
Pfizer Inc. (b) 360 27,810
Procyte Corp.* 2,100 6,038
Rhone-Poulenc Rorer Inc. 3,800 138,700
R. P. Scherer Corporation* (b) 890 40,384
Schering-Plough Corp. 1,000 74,000
Spacelabs Medical Inc.* 1,000 23,250
Surgical Care Affiliates* (b) 1,310 26,528
United Healthcare Corp. 700 31,588
Universal Health Services (Class B) 11,000 269,500
Vencor Inc.* 1,500 41,809
Total 2,435,563
Producer Goods - 4.7%
American Brands Inc. 1,000 37,500
American Power Conversion Corp.* 1,200 19,650
Briggs & Stratton Corp. 11,800 386,450
Camco International Inc. 900 16,988
Case Corp. (b) 1,260 27,090
Caterpiller Tractor Inc. 1,140 62,843
Clark Equipment Co* (b) 1,270 68,898
Cognex Corp.* (b) 970 24,978
Crown Cork & Seal Inc.* (b) 4,440 167,610
Cummins Engine Inc. 5,400 244,350
Deere & Co. 1,200 79,500
Emerson Electric (b) 420 26,250
Flow International Corp.* 32,900 230,300
Foster Wheeler Corp. 1,400 41,650
General DataComm Industries Inc.* (b) 970 31,404
General Electric (b) 4,030 205,530
Harnischfeger Industries, Inc. (b) 870 24,469
Picture Tel Corp.* 15,500 375,875
Quanex Corp. 4,200 96,075
Silicon Valley Group, Inc.* (b) 1,200 24,750
Stanley Works 8,300 296,725
Tellabs Inc.* (b) 570 31,778
Timken Co. 6,700 236,172
Total 2,756,835
Retail & Leisure - 5.7%
Alberto Culver Co. Cl B 5,700 155,325
Albertson's Inc. (b) 1,290 37,410
Best Buy Co Inc.* 4,700 146,875
Brunswick Corp. 2,700 50,963
Callaway Golf Company 1,000 33,125
Cobra Golf Inc.* (b) 2,700 96,525
Consolidated Stores Corp.* 18,000 335,250
General Nutrition Companies* 1,620 46,980
Haggar Corp. 1,000 25,250
Home Depot (b) 1,340 61,640
Inacom Corporation* 1,000 7,000
La Quinta Motor Inns (b) 1,065 22,764
Mac Frugals Bargains Clse-Outs* 12,700 254,000
Mirage Resorts Inc.* 3,800 77,900
Nordstrom Inc. (b) 780 32,760
Office Depot* (b) 1,630 39,120
Officemax Inc.* (b) 2,600 68,900
Penney J.C. 10,900 486,413
Petsmart Inc.* (b) 1,160 40,020
Pinnacle Systems Inc.* 500 7,500
Revco D.S. Inc.* (b) 1,180 27,878
Safeway Inc.* (b) 1,340 42,713
Sara Lee Corp. (b) 5,410 136,603
Sbarro Inc. 3,200 83,200
Sears Roebuck 9,000 414,000
Smart & Final Inc. 900 12,600
Sunglass Hut Inc.* (b) 1,460 33,580
Sysco Corp. 3,300 84,975
The Limited Inc. (b) 1,790 32,444
TJX Cos Inc. New* 12,000 187,500
Tommy Hilfiger Corp.* (b) 840 37,905
Waban Inc.* 2,600 46,150
Walgreen Co. (b) 570 24,938
Wendys International Inc. 9,400 135,122
Total 3,325,328
Services - 8.7%
Acclaim Entertainment, Inc.* 9,800 140,875
Armstrong World Industries Inc. 500 19,250
Automated Security (Holdings) PLC ADR* 64,517 145,163
Computer Language Reasearch 72,000 846,000
Computer Task Group 55,000 488,125
Criimi Mae Inc. 900 6,188
Failure Group Inc.* 113,700 511,650
First Data Corp. (b) 830 39,321
First Fin'l Mgmt Corp. (b) 430 26,499
HBO & Co. (b) 830 28,635
Hilb, Rogal & Hamilton Co. 16,500 200,063
Interim Services Inc.* 1,000 24,625
Kinder Care Learning Ctrs* 20,800 254,800
Manpower Inc. (b) 1,470 41,344
Microsoft Corp.* 1,800 110,025
National Education Corp.* 50,000 206,250
Netmanage Inc.* 1,000 40,500
Olsten Corp. (b) 1,160 36,830
Oracle Systems Corp.* (b) 1,170 51,626
Pittston Services Group 16,100 426,650
Platinum Technology Inc.* (b) 1,100 24,888
Ryder System 4,600 101,200
Scientific Games Hldgs Corp.* 1,000 50,000
Service Corp. International (b) 1,360 37,740
Sherwin Williams Co. 2,100 69,563
Software Publishing* 105,500 474,750
Standard Register 8,000 140,000
Steck Vaughn Publishing Corp.* 30,000 172,500
Sterling Chemicals Inc.* 1,000 13,125
Volt Info Sciences Inc.* 5,000 142,500
Xtra Corp. 4,300 193,498
Total 5,064,183
Transportation - 3.0%
Airborne Freight Corp. 11,000 225,500
Arkansas Best Corp. 1,000 12,125
Conrail Inc. 1,400 70,700
Consolidated Freightway 12,000 268,500
Covenant Transport Inc. - Cl A* (b) 1,380 26,910
CSX Corp. 1,200 83,550
Delta Air Lines (b) 480 24,240
Expeditors Intl Wash Inc. 15,000 326,250
GATX Corporation 1,700 74,800
Harper Group Inc. 10,000 157,500
Intertrans Corp. 15,000 195,000
Lockheed Corp. 1,500 108,938
Martin Marietta Corp. 700 31,063
Northrop Grumman Corp. 1,100 46,200
Northwest Airlines Corp. Cl A* (b) 1,960 30,869
Union Pacific Corp. 2,000 91,000
Total 1,773,145
Utilities - 4.0%
American Electric Power Inc. 1,100 36,163
Atlantic Energy Inc. N J 400 7,050
Boston Edison Co. 600 14,325
Brooklyn Union Gas Co. 1,000 22,250
California Energy Co Inc.* 13,100 204,688
Central Hudson Gas & Elec 1,000 26,500
Central Maine Power 1,200 16,500
Cinergy Corp. (b) 1,520 35,530
CMS Energy Corp. (b) 1,125 25,734
Columbia Gas System* 500 11,750
Consolidated Edison 6,800 175,100
Destec Energy Inc.* 1,000 10,625
Detroit Edison Co. 1,500 39,188
DPL Inc. (b) 1,150 23,575
Entergy Corporation 9,300 203,438
FPL Group Inc. (b) 1,030 36,179
General Public Utilities 1,000 26,250
Houston Industries Inc. 1,000 35,625
LDDS Communications Inc.* 10,300 200,206
Long Island Lighting 3,900 59,963
New England Elec Sys 700 22,488
Niagara Mohawk Pwr Corp. 22,800 324,900
Northeast Utils 7,900 170,838
NY St Elec & Gas Corp. 1,400 26,600
Ohio Edison Co. 1,900 35,150
Oklahoma Gas & Elec 500 16,563
Pacific Gas & Electric 9,400 229,125
Pinnacle West Capital Corp. (b) 2,300 45,425
Public Svc Co Of New Mexico* 1,000 13,000
Public Svc Ent Group Inc. 1,200 31,800
Puget Sound Pwr & Lt 1,000 20,125
Rochester Gas & Elec Corp. 1,000 20,875
Southern Co. (b) 2,350 47,000
Tucson Electric Power Co* 1,000 3,125
Unicom Corporation (b) 1,490 35,760
United Illuminating Co. 500 14,750
Western Resources Inc. 1,000 28,621
Total 2,296,784
Total Common Stocks (Cost - $39,432,716) 39,898,180
Other Equity Securities - 4.3%
S&P Depositary Receipts
(Cost - $2,514,596) 54,500 2,483,156
Short-Term Securities - 62.9% Face
Amount
Bank of New York TD, 4.74% due 1/3/95 328,333 328,333
Cash equivalents held as collateral for 1,160,100 1,160,100
Prudential-Bache Repurchase Agreement, 5.65% due 1/3/95; Issued 12/30/94
(Collateralized by FMAC and FNMA Notes, 0.0% to
10.5% due 12/1/00 to 1/15/24 with a
market value of $16,866,807) 16,535,783 16,535,783
U.S. Treasury Bill, 5.76% due 4/20/95(a) 7,300,000 7,178,747
U.S. Treasury Bill, 5.82% due 5/18/95 (a) 1,695,000 1,657,541
U.S. Treasury Bill, 6.32% due 6/15/95 (a) 10,000,000 9,726,000
U.S. Treasury Bill, 6.75% due 12/14/95(a) 20,000 18,723
Total Short-Term Securities (Cost - $36,595,276) 36,605,227
Total Long Portfolio (Cost - $78,542,588) 78,986,563
Other Assets and Liabilities - (35.8%)
Cash deposit with prime broker for short sales 4,558,788
Receivable for securities sold 493,397
Receivable for securities sold short 313,794
Unamortized organizational costs 16,989
Other assets 76,634
Payable for securities purchased (19,770,179)
Payable for short sales repurchased (72,470)
Collateral on securities loaned (1,160,100)
Market value of securities sold short (Cost - $5,102,438) (4,836,871)
Other liabilities (433,479)
Other assets and liabilities, net (20,813,497)
Net Assets - 100.0%
Applicable to 5,807,528 outstanding $.001 par value shares
(authorized 500,000,000 shares) 58,173,066
Net asset value per share 10.02
Components of Net Assets as of December 31, 1994 were as follows:
Capital Stock at par value ($.001) 5,808
Capital Stock in excess of par value 8,023,660
Distributions in excess of net realized gains on investments,
financial futures contracts, and short sales (851,144)
Net unrealized appreciation on investments, financial futures
contracts, and short sales 994,742
58,173,066
Short Portfolio - (8.3%)
Basic Materials & Natural Resources - (1.3%)
Allied Signal Inc. 1,430 48,620
Amerada Hess Corp. 1,080 49,275
Bethlehem Steel Corp. 2,420 43,560
Calgon Carbon Corporation 1,950 20,231
Dresser Inds Inc. 2,400 45,300
Enterra Corp.* 2,200 41,800
Louisiana Land & Exp Cp 550 20,006
Louisiana Pacific Corp. 750 20,438
Nucor Corp. 800 44,400
Oryx Energy Company 3,790 45,006
Paragon Trade Brands Inc. 1,500 19,875
Pennzoil 735 32,432
Royal Dutch Petroleum - NY Reg 450 48,375
Safety Kleen 3,100 45,725
Santa Fe Energy Resources Inc. 2,670 21,360
Sonat Offshore Drilling Inc. 1,850 32,838
Texaco Inc. 820 49,098
Tosco Corp. 1,250 36,406
Ultramar Corporation 2,960 75,479
Total 740,224
Communications & Technology - (1.4%)
Adobe System, Inc. 1,510 44,923
AST Research Co* 1,650 24,131
Bell Atlantic Corp. 1,140 56,715
Bellsouth Corp. 880 47,630
Cheyenne Software Inc.* 1,870 24,778
Cirrus Logic Inc.* 1,850 41,625
Comsat Corp. (Com Ser. 1) 1,500 27,938
Conner Peripherals Inc.* 4,110 39,045
Cray Research Inc.* 2,300 36,225
Dallas Semiconductor Corp. 1,640 27,265
E Systems Inc. 1,180 49,118
GTE Corp. 1,580 47,993
Hutchinson Technology Inc.* 1,190 29,453
Merisel Inc.* 3,700 29,600
Minnesota Mining & Mfg 900 48,038
Nynex Corp. 1,600 58,800
Pacific Telesis Group 1,610 45,885
Paging Network Inc. Telecom* 780 26,520
Perkin Elmer Corp. 850 21,781
Pitney Bowes Inc. 650 20,638
Scientific Atlanta Inc. 1,230 25,827
Total 773,928
Consumer Non-Durables - (0.9%)
Anheuser Busch 960 48,840
Church & Dwight Co Inc. 2,140 38,520
Coca Cola Enterprises Inc. 2,850 50,944
Coors (Adolph) Class B 2,800 46,900
Dekalb Genetics Corp. Class B 1,155 30,896
Dole Food Co 1,820 41,860
DSG International Ltd 2,100 37,275
Kroger Co 1,020 24,608
McCormick & Co.,Inc. (Non-Voting) 2,490 45,443
Mohawk Industries Inc.* 1,460 18,615
Rubbermaid Inc. 910 26,163
Seagrams Co Ltd 820 24,190
Unilever NV Ord (New York Shares) 440 51,260
Universal Foods Corp. 1,210 33,274
Total 518,788
Consumer Durables - (0.2%)
Dana Corp. 1,030 24,076
General Motors 620 26,195
General Motors Cl E 1,330 51,205
Walbro Corp. 1,400 26,600
Total 128,076
Financial - (1.0%)
Ahmanson H. F. & Co 1,870 30,154
Amsouth Bancorp 1,120 28,840
Chase Manhattan Corp. 1,410 48,469
First of America Bank Corp. 1,150 34,500
Golden West Financial Corp. 1,160 40,890
Great Western Financial 1,980 31,680
Hartford Steam Boiler/Inspection and Ins. Co. 825 32,897
Huntington Bancshares 1,785 30,791
I T T Corp. 550 48,744
J.P. Morgan & Co., Inc. 1,240 69,440
Key Corp.(New) 960 24,000
Loews Corp. 250 21,719
Midlantic Corp.Inc. 900 23,850
Piper Jaffrey Inc. 2,275 23,603
Salomon Inc. 850 31,875
Transamerica Corp. 950 47,263
USLife Corp. 1,050 36,618
Total 605,333
Health & Pharmaceuticals - (0.8%)
Ballard Medical Products 3,400 36,125
Bausch & Lomb Inc. 1,280 43,360
Baxter International, Inc. 1,850 52,263
Caremark International Inc. 2,450 41,956
Columbia/HCA Healthcare Corp. 670 24,455
Copley Pharmaceutical Inc.* 1,460 19,345
Healthsouth Rehabilitation* 1,500 55,500
IVAX Corporation 2,020 38,380
Mylan Labs Inc. 920 24,840
Patterson Dental Company* 1,425 29,569
Spacelabs Medical Inc. 1,020 23,715
United Healthcare Corp. 1,070 48,283
Wellcare Mgmt Group Inc.* 2,000 49,000
Total 486,791
Producer Goods - (0.5%)
Cinncinnati Milacron Inc. 1,000 23,625
Commercial Metals Co 960 25,920
Imperial Chemical Inds Plc 750 34,875
Minerals Technologies, Inc. 1,770 51,773
P P G Inds 650 24,131
Tenneco Inc. 1,020 43,350
United Technologies 820 51,558
Valspar 1,450 48,574
Total 303,806
Retail & Leisure - (0.8%)
Duracell International Inc. 600 26,025
Family Dollar Stores 2,000 25,000
Garan Inc. 1,975 32,094
Gaylord Entertainment Co. Class A 1,050 23,888
Hechinger Co Class A 1,650 19,181
Lone Star Steakhouse & Saloon* 2,000 40,000
Lowes Co's, Inc. 1,400 48,650
Melville Corp. 1,180 36,433
Outback Steakhouse Inc.* 1,740 40,890
Outboard Marine Corp. 1,110 21,784
Polaroid Corp. 1,540 50,050
Supervalu Inc. 945 23,153
Timberland Co.* 600 13,125
Todays Man Inc. 3,060 32,130
Wal-Mart Stores Inc. 2,120 45,048
Total 477,451
Services - (0.7%)
Access Health Marketing Inc.* 1,310 22,925
Bolt, Baranek And Newman Inc. 3,200 47,600
Calmat Inc. 2,480 43,090
Deluxe Corporation 870 23,055
Dun & Bradstreet Corp. 450 24,750
Kaufman And Broad Home Corp. 1,250 16,094
Marvel Entertainment Group* 1,280 18,240
Microsoft Corp. 580 35,453
New York Times Co Class A 1,070 23,674
Pittston Services Group 930 24,645
R.R. Donnelley & Sons 1,640 48,380
TJ Int'l Inc. 1,400 24,850
Xtra Corp. 1,370 61,649
Total 414,405
Transportation - (0.2%)
American President Cos Ltd 1,050 26,513
CSX Corp. 350 24,369
Roadway Services 600 34,049
Total 84,931
Utilities - (0.5%)
ALC Communications Corp.* 820 25,523
Delmarva Pwr & Lt Co 1,930 34,740
Dominion Resources Inc./Va 670 23,953
Enron 800 24,400
LCI International Inc.* 2,070 55,373
Minnesota Power & Light Co 1,415 35,729
Potomac Electric Power 1,240 22,785
Southwest Gas Co. 1,600 22,600
Union Elec Co 1,030 36,435
Washington Energy 1,600 21,600
Total 303,138
Total Short Portfolio (Cost - $5,102,438) 4,836,871
* Non-income producing securities
+ See Note 2 to the Financial Statements
(a) Security pledged to cover margin requirements for futures contracts.
(b) This security or a portion of this security is held in a segregated
account as collateral for the short portfolio.
See Notes to Financial Statements
TIFF INTERNATIONAL EQUITY FUND
Graph: Comparison of change in value of $10,000 Investment in TIFF
International Equity Fund and the MSCI All Country World EX USA Stock Index
where the X-axis extends from 5/31/94 to 12/31/94 and the Y-axis extends from
$10,000 to $11,000.
Performance Evaluation - The TIFF International Equity Fund had a total
return net of expenses of 1.0% from inception (5/31/94) through 12/31/94; its
benchmark, the Morgan Stanley Capital International All Country World ex
US Index (ACWxUS), had a return of 0.1%. By design, the Fund's primary
means of outperforming its benchmark are its managers' individual security
selections, not country bets. These selections added considerable value
during the fund's first four months of operations, but caused the Fund to
underperform the ACWxUS by 1.0% during 4Q 1994. Since inception, the
Fund has beaten this benchmark by 0.9%, and the EAFE Index of developed
markets by 0.5%. (All returns are net of fees.) The 21 emerging markets
that are included in the ACWxUS but excluded from EAFE did poorly
relative to developed markets during 4Q 1994, causing the former index to
underperform EAFE slightly (0.4%) from the fund's inception date through
year-end. The fund's biggest country bet, which is the product of stock
selection criteria more than top-down country analysis, remains an
underweighting in Japan (30.5% versus Japan's 38.5% weight in the
ACWxUS). Several of the Fund's managers believe that the yen is
especially vulnerable against the U.S. dollar, and their hedging has produced
a 10.2% underweighting in yen-denominated securities.
Policy Considerations
Long-Term - The Fund is designed as a core vehicle for that portion of a
Foundation's assets committed to foreign stocks. Its benchmark comprises
virtually all non-U.S. markets in which stocks trade on a regular basis. The
vast size of this opportunity set, coupled with the inefficiencies of foreign
markets, arguably makes it easier for international equity managers to
outperform their benchmarks than it is for domestic equity managers to
outperform the more efficient U.S. market. All else equal, this translates into
higher long-term expected returns for international portfolios than for strictly
domestic ones, reinforcing the case for a material commitment by long-term
investors to non-U.S. stocks.
Short-Term - The Fund is extremely well diversified across both countries
and industries. In an effort to guard against a reversal of the U.S. dollar's
weakness in recent years, the fund's managers have hedged a portion of the
fund's foreign currency exposure back into the greenback. This boosts the
fund's effective "dollar bloc" exposure to 29.3%: 11.8% via hedges, and
the remainder via holdings in foreign countries whose currencies are linked
to the U.S. dollar. This 29.3% weighting represents a 13.6% tilt in favor of
the dollar relative to its effective neutral weighting in the fund's benchmark
of 15.7%.
TIFF Investment Program, Inc.
TIFF International Equity Fund - Statement Of Net Assets
December 31, 1994
Shares Value+
Long-Term Investments - 83.5%
Common Stock - 80.5%
Argentina - 0.9%
Acindar 44,393 39,731
Banco Galicia y Buenos Aires 7,360 29,440
Compania Naviera Perez ADR 6,300 51,908
Inversiones y Repres* ADR (144A) (a) 1,600 43,997
Quilmes Industries SA 17,650 421,950
Telecom de Argentina GDS (144A) (a) 1,600 82,000
Telefonica de Argentina ADR 450 23,850
YPF Sociedad Anonima ADR 4,300 91,913
Total 784,789
Australia - 3.5%
Aust & NZ Bank Grp Ord. 116,000 382,475
Australian National Inds 172,080 192,248
CSR Ltd . 17,000 58,648
Eastern Aluminum Ordinary* 116,000 112,497
Gio Australian Holdings Ltd. 117,611 223,543
National Australia Bank Ltd. 58,000 464,035
North Limited 64,200 169,340
Pacific Dunlop 140,620 373,923
Pioneer Intl Ltd. 78,000 193,643
QNI Limited* 118,000 192,245
Renison Goldfiel* 56,000 212,878
Santos Ltd. 142,000 383,176
Wesfarmer Ltd.* 26,883 172,269
Total 3,130,920
Austria - 0.3%
BWT Stamm* 550 84,480
Mayr-Melnhof* 2,500 146,951
Total 231,431
Belgium - 0.8%
Electrabel 2,200 395,599
G.I.B. Holdings Ltd. 7,900 311,927
Total 707,526
Brazil - 1.0%
Cemig Cia Energy* ADR 6,100 144,962
Companhia Siderurgica Nac ADR 3,800 129,436
Iochpe - Maxion ADR 5,500 95,781
Papel Simao ADR 5,200 113,580
Sao Paulo Alpargatas* ADR 10,000 95,000
Telecomunicacoes Brasileiras ADR 3,300 147,665
Vale do Rio Doce ADR 4,300 205,612
Total 932,036
Canada - 1.0%
British Columbia Telecom Inc. 11,500 196,749
Imperial Oil Ltd. 8,172 269,429
Noranda Corp. 15,000 280,689
Rogers Communications Class B* 9,000 118,691
Total 865,558
Chile - 0.3%
Cristalerias de Chile SA ADR 5,000 78,750
Empresa Nacional de Electric ADR 2,700 69,525
Quimica y Minera Chile ADR 2,500 72,813
Telefonos de Chile SA ADR 1,080 85,050
Total 306,138
Colombia - 0.2%
Banco Ganadero GDS (144A) (a) 2,340 58,500
Cementos GDR (144A) (a) 2,750 64,625
Corp. Financiera del Valle SA ADS (144A 1,900 39,900
Corporation Financie ADR 650 13,650
Total 176,675
Denmark - 0.1%
Tele Danmark 'B'* 1,600 81,309
Total 81,309
Finland - 0.5%
Kansallis-Osake-Pankki* 76,100 88,946
Outokumpo Oy* 8,800 161,808
Unitas A* 67,000 172,760
Total 423,514
France - 5.7%
Alcatel Alsthom 3,900 333,252
Axa SA 3,200 148,352
Banque National de Paris 3,009 138,426
Boiron Frf25 725 62,209
Carrefour Supermarche 400 165,802
Cie Generale des Eaux* 8,000 778,038
CIPE France 1,275 171,784
Clarins 700 57,191
Coflexip* ADR 28,000 651,000
Emin-Leydier 1,775 166,308
Grandoptical Photoservices* 3,000 218,683
Idia 12,000 349,892
Lectra Systemes* 74,315 254,841
M6* 2,000 115,431
Moulinex* 5,000 94,163
Naf Naf 1,500 59,027
NRJ SA 650 65,773
Pechiney 2,300 155,158
Sidel 1,000 204,254
Sidergie 2,179 259,283
Societe National Elf-Aquitaine 5,460 384,599
Ste. Guilbert SA 2,500 213,623
Union Financiere de France 600 65,099
Total 5,112,188
Germany - 3.4%
Bayer AG 1,330 311,759
Buderus 200 85,626
Deutsche Bank AG Ger 200 92,987
Fresenius 400 146,713
Hochtief 1,166 703,244
Leifheit 320 146,713
Linde AG German 1,000 584,399
Mannesmann AG 400 109,002
Marschollek Lauten 210 121,368
Rhoen-Klinikum AG Vorzugsakt 60 35,645
Rhon Klinikum AG 162 135,994
RWE 700 196,403
Siemens AG German 470 196,971
Veba AG 300 104,611
Wella AG Dm50 200 134,315
Total 3,105,750
Greece - 0.1%
Hubco* GDS 3,200 33,216
Intracom SA 363 13,061
Total 46,277
Hong Kong - 3.2%
Hong Kong & Shanghai Hotels 92,000 106,435
Hong Kong Electric 68,000 185,912
Hong Kong Telecom 93,200 177,704
Hutchison Whampoa 155,000 627,130
Jardine Matheson HK Registry 18,000 128,554
Jardine Strategic Holdings 234,500 769,957
Johnson Electric Holdings-500 200,000 458,900
Mandarin Oriental 134,000 156,767
Television Broadcasts Ltd. 57,000 227,675
Total 2,839,034
India - 0.6%
Bajaj Auto GDS* 2,350 53,196
DCW GDR* 2,000 32,000
Gujarat Narmada Vall GDR* 4,800 55,200
Indian Rayon & Industries GDS* 4,050 70,875
Shiriram Ind. GDR* 2,000 82,500
South India Viscose GDS* 12,700 73,025
Tata Engineering & Locomotion GDR* 3,600 63,000
Tube Investments of India Ltd. GDR* 7,500 48,750
Usha Beltron Ltd. GDR* 7,800 65,325
Total 543,871
Indonesia - 1.1%
Astra International IDR - For Shares 102,400 195,764
Bank International Indonesia-For Reg 56,000 161,221
Gadjah Tunggal (Alien Shares) 36,000 49,158
Indonesian Dev* 15,400 127,820
PT Indah Kiat Pulp & Paper - For Shares 84,000 99,406
PT United Tractors (Fb) 28,000 59,900
PT Wicaksana Overseas International* 100,000 286,750
Total 980,019
Ireland - 0.8%
Greencore PLC 47,000 294,319
Irish Continental 23,000 149,362
Smurfit (Jefferson) Group PLC 23,750 139,543
Waterford Wedgewood* 180,000 161,424
Total 744,648
Italy - 1.0%
Fila Holdings S.p.A. ADR 10,700 211,325
Gabetti Hld S.p.A. 22,000 26,481
Industrie Natuzzi S.p.A. ADR 12,800 435,200
Olivetti* 68,700 87,146
R.A.S. D Risp Port 13,580 82,133
R.A.S. S.p.A. 420 4,267
Stet D Risp Non Cvt 35,300 83,739
Total 930,291
Japan - 18.7%
Amano Corp. 16,000 237,870
Canon Sales Co. Inc. 20,000 606,730
Chiyoda Fire And Marine Ins 37,000 234,155
Daido Steel Co. 38,000 221,396
Daishinku 12,000 155,500
East Japan Rail 82 410,206
Eisai Co. Ltd. 21,000 343,848
Fijitsu Denso* 14,000 286,891
Fuji Oil 31,000 269,362
Fuji Photo Film 14,000 324,862
Futaba Corp. 8,000 429,131
Gakken 9470* 34,000 258,886
Heiwa 8,000 201,708
Hitachi Ltd. (Hit. Seisakusho) 39,000 387,453
Ishihara Sangyo Kaisha* 52,000 208,416
Ito Yokado Co. 9,000 481,868
Itochu Corp. 34,000 242,491
Joshin Denki 10,000 139,628
Kanematsu Corp. 66,000 348,064
Kawasho* 48,000 235,301
Koa Oil Co., Ltd. 38,000 284,761
Konica Corporation 40,000 337,520
Kyocera Corp. 4,000 296,936
Kyokuto Boeki 28,000 225,014
Makita Corporation ADR 38,000 674,500
Matsushita Elec Ind 21,000 345,956
Mitsubishi Corp. 20,000 263,184
Mitsubishi Heavy Industries, Ltd. 96,000 732,902
Mitsui & Co. 64,000 546,458
Mitsui Warehouse 28,000 240,201
Navix Line* 66,000 234,696
Nichimo* 50,000 233,550
Nippon Oil Co. 36,000 239,760
Nippon Sanso 48,000 256,997
Nippon Soda* 54,000 366,692
Nippon Suisan* 44,000 206,853
Nippon Telegraph and Tel. Corp. 46 407,092
Nippondenso 35,000 738,322
Sankyo Seiko* 26,000 240,282
Showa Aircraft 11,000 156,906
Sintokogio 28,000 248,920
Sumitomo Metal Industries* 68,000 220,633
Sumitomo Rubber 39,140 380,194
Toda Construction Co. 22,000 196,684
Toho Co. 2,400 421,899
UBE Industries Ltd.* 70,000 270,718
Victor Co. Japan* 16,000 233,048
Wacoal Corp. 36,000 401,407
Yamaha Corp. 46,000 586,840
Yamaha Motor 46,000 434,355
Yushiro Chemical 20,000 241,084
Total 16,688,129
Korea - 0.2%
Kia Motors Corporation GDS* 2,000 36,000
Korea Fund 3,821 86,928
Samsung Co. Ltd. GDR* 1,700 18,700
Total 141,628
Malaysia - 4.2%
Aokam Perdana Berhad 14,000 86,660
Arab Malaysian Fin. (Alien) 16,666 43,420
Carlsberg 26,000 112,046
DCB Holdings Berhard 48,000 107,189
Edaran Otomobil Nasional Berhad 12,000 91,204
Ekran Berhad 13,000 38,453
Genting Berhad 7,000 60,059
Land & General Berhad 21,000 87,208
Leader Universal Holdings Ltd. 26,667 85,667
Malayan Banking Berhad 15,000 90,500
Malaysian Airline System Berhad 45,000 134,870
Nestle (Malaysia) Berhad 115,000 765,912
Nylex (Malaysia) Berhad 300,000 646,440
Resorts World Berhad 57,000 334,965
Road Builder 8,000 43,565
Sime Darby Berhad 232,800 533,554
Systems Telekom Malaysia* 25,000 169,443
Technology Resources Inds.* 25,000 79,823
United Engineers (Malaysia) 47,000 232,006
Total 3,742,984
Mexico - 1.9%
Bufete Industrial SA ADS 1,250 36,875
Cementos de Mexico Cpo ADR 2,600 26,395
Cifra SA De Cv B 17,000 34,861
Consorcio G Grupo Dina ADR 3,700 35,150
Cydsa SA 10,950 30,794
Desc SA Series C 6,150 35,017
Empressa ICA Sociedad ADR 1,500 23,250
Grupo Carso SA De CB ADR (144A)* (a) 3,100 46,389
Grupo Fernandez Editores Series B* 17,500 18,929
Grupo Financiero Bancomer ADR (144A) (a) 2,000 26,000
Grupo Financiero Banorte-C* 10,000 24,489
Grupo Industrial Alfa SA-A* 3,720 35,150
Grupo Situr SA ADR (144A) (a) 2,124 43,985
Organizacion Soria 33,300 39,960
Panamerican Beverages Inc-A 22,000 695,750
Telefonos de Mexico ADR 10,210 418,610
Tolmex SA de Cv 3,100 26,571
Transport Maritima Mex-Ads"L ADR 8,100 61,763
Vitro Sociedad Anonima ADR 2,400 33,600
Total 1,693,538
Netherlands - 4.3%
Aalberts Industrie 3,400 164,677
Draka Hldgs 7,000 161,045
Elsevier 33,000 344,405
Intl Nederlanden Group 6,560 310,165
Kon. Nedlloyd Groep Aandeel* 5,600 183,728
Koninklijke Boskalis* 7,800 159,211
Philips Gloeilampen Gem Bezit 1,900 56,311
Polygram 3,400 158,208
Randstad Holdings N. V. 8,000 433,143
Roto Smeete D Boer 6,400 139,860
Royal Dutch Petroleum - NY Reg 7,900 849,250
Royal Dutch Petroleum Co. 2,700 294,240
Smit Transformator* 8,800 237,721
Wegener NL Cvantfl 2.5 5,000 367,583
Total 3,859,547
New Zealand - 0.7%
Carter Holt Harvey Ltd. 52,000 106,579
Telecom New Zealand 103,000 336,460
Wilson & Horton 24,000 137,580
Total 580,619
Norway - 2.1%
A/S Veidekke 5,000 86,551
Norsk Hydro ADR 20,000 782,500
Olav Thon 5,700 75,899
Schibsted 13,400 154,639
Sensonor A/S* 25,000 155,348
Simard 'B 4,600 46,279
System Etiketterin 10,000 142,032
Unitor Ships ADR 27,000 455,053
Total 1,898,301
Pakistan - 0.1%
Dewan Salman Fibre 7,000 32,006
Fauji Fertilizer* 12,500 33,475
Pakistan State Oil Co. Ltd. 1,250 18,125
Total 83,606
Peru - 0.1%
Banco de Credito del Peru 7,500 16,701
Pacifico Peru Suiz* 470 17,276
Peruana Telefonos* 11,724 13,600
Southern Peru Copper Corp.* 2,560 14,026
Total 61,603
Portugal - 0.5%
Banco Espirito 5,100 98,730
Corticeira Amorim* 1,600 26,660
Jeronimo Marhns 480 20,543
Modelo Continen* 1,000 87,681
Modelo Supermer* 1,600 48,774
Somague 4,250 34,727
Sonae Industria e Investimento* 3,830 88,131
Total 405,246
Singapore - 1.1%
Keppel Corp. Ltd. 87,000 740,422
Singapore Land 50,000 293,410
Total 1,033,832
South Africa - 1.8%
De Beers Cons Mines Ltd. ADR 10,800 252,450
Free State Con Gold ADR 13,200 202,950
Iscor 326,400 376,241
Liblife Strategic Invts Ltd. 125,000 392,550
Nasionale Pers* 20,000 89,162
South African Breweries ADR 6,800 160,612
Vall Reefs Explor & Mng Ltd. ADR 18,100 164,031
Total 1,637,996
Spain - 2.1%
Acerinox SA 2,000 208,968
Asturiana de Zinc* 15,000 162,995
Azkoyen 1,800 117,492
Banco Central Hispano 4,700 112,500
Banco Intercontinental Espa 8,000 660,790
Centros Comerciales Pryca 7,900 119,161
Construc. y Auxiliar 750 40,464
Cubiertas 41 2,894
Europistas Concesionaria Espanola SA 733 6,043
Tabacalera Spani 4,400 117,355
Telefonica Nacio 18,400 217,416
Viscofan Envolturas 5,000 75,988
Total 1,842,066
Sweden - 2.9%
Allgon Ab Ser 'B' Free 8,000 150,811
Autoliv Ab* 6,200 238,766
Avesta-Sheffield-Free* 13,500 133,610
Celsius Industrier AB-B 12,600 279,943
Elekta AB* 7,500 161,584
Ericsson AB B FreeB123 1,800 99,616
Hennes & Mauritz AB-F 3,900 200,081
Hoganas AB-B* 7,000 108,396
Kinnevik Ab-B Free Shares 4,900 162,311
Marieberg Tidnings-Ser A Free 5,900 133,468
Munksjo AB Free 20,000 162,930
OM Gruppa AB Free 3,500 101,326
Skandinaviska Enskilda Banken* 30,900 176,831
SSAB 3,700 161,920
Terra Mining 5,900 154,918
Trelleborg B Free* 10,400 151,943
Total 2,578,454
Switzerland - 4.2%
BBC Brown Boveri 4,300 710,255
Fischer (Georg)* 100 116,999
Fust (Dipl.Ong AG) 520 155,081
Hilti AG-Pc 125 93,198
Keramik Holding AG Laufen Br* 200 123,882
Nestle-Sponsored ADR 16,000 762,306
Pheonix Meccano 300 97,499
Rentsch (W) Holding AG* 730 113,321
SGS Soc Gen Surveillance - R 650 169,496
SGS Soc Gen Surveillance-B 500 692,055
Sika Finanz AG-Bearer 2,000 575,055
SMH AG-Registered 1,100 121,129
Total 3,730,276
Thailand - 0.6%
Advanced Info Services (Fb) 3,600 49,348
Bangkok Bank-Alien Mkt 18,000 192,229
Industrial Finance Corp. (Fb) 68,066 145,110
Property Perfect (FB)* 9,797 114,777
Total 501,464
U.K. - 10.3%
Airtours 20,000 135,388
Asda Group 143,100 152,487
Associated British Foods 40,000 354,768
Associated British Ports 32,400 138,604
Barclays PLC 13,600 130,424
Bass PLC Registered 42,000 338,612
Bemrose Corp. 20,000 119,092
Bet Public Limited Co. 93,600 148,871
Blenheim Group 120,000 441,900
Blue Circle Industries PLC 73,000 323,726
British Airways PLC 61,000 342,204
British Gas Corp. 70,000 342,237
British Sky Broadcasting* ADR 12,800 307,200
Central European Media Enterprise* 15,000 210,000
Domestic & Genl 5,000 129,670
First Leisure Corp. PLC 34,700 147,898
First National Finance Corp. 148,300 139,432
GKN PLC 31,000 285,392
Goode Durrant 50,000 155,915
Granada Group PLC 16,900 135,589
Great Universal Stores 34,000 286,637
Halma PLC 45,000 150,197
Hanson PLC ADR 35,000 630,000
Hanson Trust PLC 35,600 128,865
Invesco MIM 47,400 121,813
Jarvis Porter 45,217 198,394
Provident Financial PLC 16,000 135,890
Racal Electronics (Ex-Chubb) 40,000 141,032
Reliance Industries GDS 5,100 117,300
RTZ Corp. 11,400 148,091
SBC Brit Aero P 22,000 148,238
Sears PLC 168,000 289,582
Serco Group 40,000 176,132
Seton Healthcare 40,000 201,828
Stagecoach Holdings 25,000 88,928
Standard Chartered PLC 31,500 138,704
T Cowie 37,700 134,103
Taylor Woodrow PLC 246,700 494,831
Trinity Hldgs 30,800 157,822
Unigate PLC 64,000 332,960
Vendome Units 17,100 134,514
Vodafone Group PLC 41,700 138,526
Welsh Water PLC 12,800 132,780
WPP Group Ord. 74,100 127,148
Total 9,233,724
Venezuela - 0.2%
Corimon C.A. ADR 8,800 80,300
Mavesa SA ADR (144A) (a) 15,500 76,644
Traf Cnv 72,900 110,808
Total 267,752
Total Common Stock (Cost - $72,350,424) 71,922,738
Preferred Stocks - 0.9%
BMW Non Vot. Prf* (Germany) 300 107,129
Krones AG Preferred (Germany) 860 483,146
Nokia AB Preferred - Free (Finland) 600 88,513
Porsche NV Pref* (Germany) 200 87,111
Total (Cost - $907,836) 765,899
Rights - 0.0%
T Cowie Rights (U.K.)* 4,712 2,437
Total (Cost - $0) 2,437
Warrants - 0.6%
Bayer AG Warrants (Germany)* 800 94,020
Deutsche Bank Optionsschein Warrants (Germany) 3,000 325,455
Mr. Max Warrants 91/95 (Japan)* 500 117,848
R.A.S. Risp S.p.A.-CW 97 Warrants (Ital 5,820 -
R.A.S. S.p.A.-CW 97 Warrants (Italy)* 180 -
Senshukai Co. Warrants (Japan)* 25 16,875
South India Viscose GDS Warrants (India 3,000 4,500
Total (Cost - $711,196) 558,698
Face
Amount (c)
Bonds - 1.5%
Bangkok Bank Public Co., 3.25% due 3/3/ 750,000 668,438
Canadian Government, 10.25% due 3/15/14 695,000 542,256
Essar Gujarat Ltd., 5.5% due 8/5/98 (I 40,000 69,400
Mediobanca, 4.0% due 12/31/97 (Italy) 28,600,000 17,654
Ssangyong Oil Refining, 3.74% due 12/31 35,000 37,275
Total (Cost - $1,395,067) 1,335,023
Total Long-Term Investments (Cost - $75,364,523) 74,584,795
Short-Term Investments - 20.8%
Bank of New York TD, 4.74% due 1/3/95 5,803,684 5,803,684
Cash equivalents held as collateral for 2,666,916 2,666,916
U.S. Treasury Bill, 6.00% due 5/18/95 (b) 1,715,000 1,677,090
Prudential-Bache Repurchase Agreement, 5.65% due 1/3/95; Issued 12/30/94
(Collateralized by FMAC and FNMA Notes, 0.0% to 10.5% due
12/1/00 to 1/15/24 with a market value
of $8,545,316) 8,377,612 8,377,612
Total (Cost - $18,523,766) 18,525,302
Total Investments - 104.3% (Cost - $93,888,289) 93,110,097
Other Assets and Liabilities - (4.3%)
Other Assets 1,569,092
Unamortized organizational costs 27,152
Receivable for securities sold 1,287,665
Payable for securities purchased (3,767,813)
Collateral on securities loaned (2,666,916)
Other liabilities (250,511)
Other assets and liabilities, net (3,801,331)
Net Assets - 100.0%
Applicable to 8,949,420 outstanding $.001 par value shares
(authorized 500,000,000 shares) 89,308,767
Net asset value per share 9.98
Components of Net Assets as of December 31, 1994 were as follows:
Capital stock at par value ($.001) 8,949
Capital stock in excess of par value 91,137,089
Accumulated net realized gain/(loss) on investments, financial
futures contracts, and foreign currency-related transaction (1,229,799)
Net unrealized (depreciation) on investments, financial futures
contracts, and translation of assets and liabilities in for (607,472)
89,308,767
* Non-income producing security
+ See Note 2 to the Financial Statements
ADR American Depositary Receipt
ADS American Depositary Share
GDR Global Depositary Receipt
GDS Global Depositary Share
(a) Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
At December 31, 1994, these securities were valued at $482,040 or
0.5% of net assets.
(b) Security pledged to cover margin requirements for futures contracts.
(c) Principal amounts stated in U.S. dollars unless otherwise noted.
See Notes to Financial Statements
TIFF EMERGING MARKETS FUND
Graph: Comparison of change in value of $10,000 Investment in TIFF Emerging
Markets Fund and the MSCI Emerging Markets Free Stock Index where the X-axis
extends from 5/31/94 to 12/31/94 and the Y-axis extends from $9,000 to $11,800.
Performance Evaluation - From inception (5/31/94) through 12/31/94, the TIFF
Emerging Markets Fund had a total return net of expenses of -7.0%. The
return for its benchmark, the Morgan Stanley Capital International Emerging
Markets Free Index (EMF Index), over the same time period was -0.2%.
Although the Fund outperformed the EMF Index during 4Q 1994, it did not
escape the recent downdraft in emerging markets and it continues to lag the
Index since inception. The Fund's performance deficit narrowed during the
quarter dramatically so from mid-October through December 2, after which
the deficit began widening again. The reason that the Fund entered 4Q 1994
lagging its benchmark (Fund up 9%, its benchmark up 8% more) is because
its primary manager during its first four months of operations - Emerging
Markets Management (EMM) - employs disciplines that induced it to invest
capital very slowly, despite - indeed because of - rapidly rising prices in its
selection universe. The Fund's cash reserves cushioned losses during the
roughly 10% decline in emerging market averages from mid-September
through early December, but decisions by EMM and BEA to exploit market
weakness by converting pre-existing reserves as well as much of the cash
flowing into the Fund into stocks caused the Fund's share price to drop by
8.2% from December 2 to year-end. In hindsight, the managers would have
done well to postpone these purchases, but emerging markets had already
fallen materially from their September highs and the managers could not
know that stocks they deemed attractively priced would become cheaper still
by year-end.
Policy Considerations
Long-Term - Foundations should not expect to earn superior returns from
emerging market stocks solely because the economies of the countries in
which they are traded are growing rapidly: while there may be some
opportunities to exploit superior growth prospects, the safer assumption is
that superior growth will already be reflected in securities prices.
Ironically, the strongest argument in favor of emerging market investing is that
emerging markets embody many risks that unnerve investors: disclosure
standards are lax, custodial procedures remain imperfect, insider trading is
widespread, and market psychology often causes the price pendulum to swing
to unjustified extremes. These risks spell opportunity for skilled investors,
to exploit valuation anomalies, rather than superior growth, in emerging market
economies.
Short-Term - Panic selling in down markets by growth-oriented investors
belatedly discovering that their time horizons are shorter than they'd earlier
supposed has spawned legitimate opportunities for value investors in
emerging markets. But the very fact that these opportunities derive more
from shrinking investor time horizons than from improving fundamentals
makes the short-term risks of investing in emerging markets especially acute.
Foundation boards seeking to exploit the recent turmoil in such markets
should be doubly sure that their time horizons are indeed long term -
especially if the proposed move represents their initial foray into emerging
markets.
TIFF Investment Program, Inc.
TIFF Emerging Markets Fund - Statement Of Net Assets
December 31, 1994
Shares Value+
Long-Term Investments - 89.5%
Common Stock - 81.8%
Argentina - 4.0%
Acindar 79,280 70,956
Astra Cia Argentina Depetro 49,960 82,434
Bagley SA 'B' ARP1 3,300 11,550
Banco Frances del Rio Plata 3,200 21,120
Banco Galicia y Buenos Aires 20,779 83,116
Buenos Aires Embotellado ADR 2,320 74,820
Cia de Bebidas y Alimentos* 11,220 29,733
Cia Naviera Perez Companc-B 28,350 116,802
Commercial del Plata 110,640 282,132
Compania Naviera Perez ADR 14,200 116,998
Cristalerias Rigolleau* 41,771 40,936
Dycasa SA* 8,472 34,312
Inversiones y Repres ADR* 2,700 74,245
Irsa Inversiones y Represent (144A) (a) 62,477 171,812
Molinos Rio de La Plata* 3,790 21,053
Quilmes Industries SA 3,800 87,400
Telecom Argentina SA - Cl B (144A) (a) 7,200 35,280
Telecom de Argentina GDS 2,400 123,000
Telefonica de Argentina ADR 1,350 71,550
YPF Sociedad Anonima* ADR 21,700 463,836
Total 2,013,085
Austria - 0.9%
Julius Meinl International*
Total 13,100 437,268
Bangladesh - 0.1%
Beximco Pharmaceuticals Ltd.
Total 770 27,119
Brazil - 7.5%
Avipal SA-Avicultura E Agrop 9,620,000 45,214
Banco Bradesco 24,055,000 204,468
Bombril ADR* 4,400 122,081
Brahma 390,000 128,544
Cemig Cia Energy ADR (144A)* (a) 18,800 444,577
Cia Paulista de Forca e Luz* 900,000 79,830
Cia Souza Cruz Ind e Com 9,300 76,950
Cia Tecidos Norte de Mina* 320,000 109,696
Companhia Siderurgica Nac. ADR 9,600 326,995
Companhia Siderurgica Nacional 3,400,000 115,940
Copene - Petroquim 60,000 52,410
Dixie Lalekla SA-Pref* 50,000 50,235
Iochpe - Maxion ADR 10,000 174,147
Multibras SA Pref 31,000 40,675
Papel Simao ADR 11,900 259,923
Patroleo Brasile 1,030,000 130,295
Sao Paulo Alpargatas ADR* 16,000 152,000
Telecomunicacoes Brasileiras ADR* 7,700 344,553
Telecomunicacoes Brasileiras ADR* 20 1,142
Usiminas (Non-voting Shares)* 118,700,000 166,180
Vale Do Rio Doce ADR 15,700 750,723
Total 3,776,578
Chile - 3.6%
Chilectra SA ADR (144A) (a) 1,800 89,315
Compania Cervecerias Unidas ADS 1,200 30,150
Cristalerias de Chile SA ADR 8,800 138,600
Empresa Nacional de Electric ADR 5,700 146,775
Enersis SA ADR 2,000 55,500
GT Chile Growth Fund 16,900 498,550
Laboratorio Chile SA ADS 4,100 89,688
Madeco SA ADR 800 21,200
Maderas y Sinteticos Sociedad ADR 1,200 30,600
Quimica y Minera Chile ADR 7,500 218,438
Telefonos de Chile SA ADR 6,100 480,374
Total 1,799,190
China - 0.3%
AES China Generating Co. (Class A)* 3,500 37,188
Shanghai Haixin Co. Ltd.-B 46,200 32,432
Shanghai Shangling Elec App - B* 50,000 43,000
Shenzhen China Bicycles Co.-B 87,500 38,456
Total 151,076
Colombia - 1.5%
Banco de Bogota 9,100 52,557
Banco Ganadero GDS (144A) (a) 3,400 85,000
Bavaria* 9,607 35,834
Carulla SA ADS (144A)* (a) 15,188 173,609
Cementos GDR (144A) (a) 4,000 94,000
Cementos Paz del Rio ADS* 1,700 40,609
Compania Boliviana Energia 1,000 22,750
Computec SA* 36,000 16,675
Corp. Financiera del Valle SA ADS (144A 4,500 94,500
Pavco* 11,000 34,545
Suramericana de Seguros SA 3,490 75,586
Total 725,665
Czech Republic - 1.1%
Cement Hranice* 1,065 41,944
Deza As* 1,570 123,666
Electro Praga* 2,343 176,165
Fatra* 1,220 112,478
ZPS Zlin 1,450 88,257
Total 542,510
Ecuador - 0.2%
La Cemento Nacional Of Ecuador GDR* (144A) (a)
Total 260 98,530
Ghana - 0.1%
Ashanti Goldfields Ltd. ADR (144A)* (a)
Total 2,700 58,725
Greece - 0.6%
A.G. Petzetakis* 3,600 23,047
Aegek 1,200 22,449
Alcatel Cables Hellas 700 7,828
Chipita* 1,100 21,698
Credit Bank/ Greece* 1,900 81,513
Hellenic Bottling Co. 1,000 35,336
Hubco GDS* 4,600 47,748
Intracom SA 572 20,581
Michaniki SA 1,400 21,505
Nikas- SA 1,300 17,401
Total 299,106
Hong Kong - 6.7%
CP Pokphand Co. Ltd. 1,986,000 464,724
Champion Technology Hldgs 641,889 133,577
Chen Hsong Holdings 60,000 38,004
China Overseas Land & Invest 110,000 20,196
China Steel Corp. GDS 42,100 957,775
Consolidated Electric Pwr Asia 44,000 96,690
Dong Fang Electric* 144,000 65,621
Guangdong Investment Ltd. 288,000 142,387
Henderson Land Development 12,000 57,239
High Fashion International* 336,000 45,158
KTP Holdings Ltd. 556,991 69,123
Lamex Holdings Ltd. 238,000 103,054
Legend Holdings Limited 114,000 14,444
Lung Kee (Bermuda) Holdings 138,000 31,216
Mc Packaging Ltd. 86,000 33,351
Pacific Concord Hldgs 276,000 51,722
Qingling Motors Company Ltd. (144A)* (a 180,000 55,836
Semi-Tech (Global) Ltd. 162,000 273,278
Shell Electric Mfg 175,000 48,073
Sinocan Holdings Limited 640,000 142,272
Siu-Fung Ceramics Hldg Ltd. 156,000 26,411
Sun Hung Kai Properties Ltd. 11,000 65,693
Tian An China Investment 739,000 148,096
Tomei International Holdings 1,942,000 153,224
Varitronix Intl Ltd. 18,000 25,594
World Houseware Holdings Ltd. 228,000 66,301
Total 3,329,059
Hungary - 1.0%
Danubius Hotel* 5,830 50,987
Fotex ADR 11,100 167,951
Fotex Rt Budapest 52,011 157,390
Pannonplast Plastic Industries 6,070 67,092
Soproni Sorgyar Brewery Ltd.* 2,100 57,675
Total 501,095
India - 4.5%
Bajaj Auto GDS* 4,750 107,524
DCW GDR* 2,900 46,400
Grasim Industries Co. GDS 2,000 47,460
Gujarat Narmada Vall GDR* 9,800 112,700
India Cement GDR (144A)* (a) 12,600 106,470
Indian Rayon & Industries GDS* 6,200 108,500
Jain Irrigation IDR 11,000 71,830
Jardine Fleming India Fund 19,000 235,125
Morgen Stanley India Investmentt (Close End Fund) 33,500 376,875
Nelson Trade And Finance Ltd.* 8,700 17,986
PT Ultra Jaya Milk (FB) 44,250 100,704
Reliance Industries ADR 6,300 144,900
Reliance Industries GDS 9,900 227,700
San Francisco/Moscow Teleport* 9,000 90,000
Sanghi Polyesters GDR* 1,200 8,800
South India Viscose* 22,700 130,525
Tata Engineering & Locomotion GDR* 6,400 112,000
Tube Investments Of India Ltd. GDR* 10,900 70,850
Usha Beltron Ltd. GDR* 14,000 117,250
Total 2,233,599
Indonesia - 2.9%
Astra International IDR-Foreign Shares 124,000 214,999
Bank Int'l Indonesia-For. Reg 61,000 161,586
Gadjah Tunggal (Alien Shares) 50,000 68,275
PT Astra Graphia* 55,500 151,571
PT Bakrie And Brothers-For. Reg* 42,500 132,511
PT Charoen Pokphand Indo-For. 10,500 43,013
PT Dharmala Sakti Sejah-For. Rg 54,000 41,170
PT Great River Garments 24,000 19,663
PT Indah Kiat Pulp & Paper-Foreign Shares 132,000 156,209
PT Int'l Nickel Indonesia-For. 23,500 33,426
PT Jakarta Int'l Hotel-For. 53,500 69,400
PT Japfa Comfeed Indonesia - Foreign* 23,000 26,958
PT Matahari Putra Prima-For. 32,000 59,718
PT Pakuwon Jati-For. Reg 148,500 125,052
PT Petrosea-For. Reg 36,000 63,904
PT United Tractors (Fb) 37,500 80,224
Total 1,447,679
Israel - 0.3%
ECI Telecommunications 2,700 36,788
Geotek Communications* 9,300 80,213
Tecnomatix Technologies Ltd.* 2,200 11,275
Teva Pharmaceutical ADR 1,000 24,187
Total 152,463
Kazakhstan - 0.0%
Bakyrchik Gold*
Total 5,100 19,340
Korea - 11.3%
Daewoo Heavy Inds 21,600 336,986
Daewoo Securities Co. 6,000 227,549
Hanshin Co.nsruction Co. 7,200 97,717
Hyundal Eng. & Construction Co.* 6,694 335,379
Korea Electric Power Corp. 10,900 376,053
Korea Electric Power Corp. ADR 51,500 1,107,250
Korea Fund 23,758 540,495
Pohang Iron & Steel Ltd. ADR 47,200 1,380,600
Pusan Steel Pipe Corp. 4,900 191,426
Sam Sung Electronics 3,300 456,241
Shinhan Bank 5,500 136,035
Ssangyong Cement Co.* 4,990 191,144
Ssangyong Invest.& Secs Co. 3,100 81,393
Taegu Dept. Store Co. Ltd. 1,700 67,707
The Korea Express 1,094 52,730
Tongyang Investment & Finance 1,940 50,443
Total 5,629,148
Malaysia - 8.5%
Aokam Perdana Berhad 41,000 253,790
Arab Malaysia Corporation 14,000 39,217
Arab Malaysian Fin (Alien) 26,666 69,473
Arab-Malaysian Merchant Bank 3,000 28,443
Berjaya Group Berhad 126,000 152,044
DCB Holdings Berhad 71,000 158,550
Edaran Otomobil Nasional Berhad 18,000 136,807
Ekran Berhad 66,000 195,221
Genting Berhad 52,000 446,150
IJM Corp. Berhad -A 25,000 83,743
Kelanamas Ind 13,000 26,229
Kian Joo Can Factory Berhad 31,500 104,898
Land & General Berhad 38,000 157,806
Leader Universal Holdings Ltd. 48,333 155,271
Magnum Corp. Berhad 32,000 57,418
Malayan Banking Berhad 81,000 488,697
Malaysian International Shipping Corp.- 30,000 85,797
Malaysian Pacific Industries 134,000 237,287
Olympia Industries 8,000 42,311
Perusahaan Sadur Timah Malay* 26,000 58,061
Resorts World Berhad 20,000 117,532
Sime UEP Properties 18,000 37,375
Systems Telekom Malaysia* 45,000 304,997
Technology Resources Inds.* 153,000 488,514
Time Engineering 32,000 79,610
UMW Holdings Berhad 52,000 138,533
United Engineers (Malaysia) 23,000 113,534
Total 4,257,308
Mexico - 11.9%
Apasco 10,000 50,612
Bufete Industrial SA ADS 3,450 101,775
Cementos de Mexico* 54,000 286,713
Cementos de Mexico CPO ADR 4,500 45,684
Cifra "C" 75,000 145,164
Cifra SA De Cv B 90,000 185,439
Coca Cola Femsa ADR 2,900 71,413
Consorcio G Grupo Dina ADR 6,500 61,750
Controladora Coml Mexicana B 25,000 21,735
Corporation Indl Sanluis A-2 10,000 83,673
Cydsa SA 30,800 86,616
Desc SA Series C 11,500 65,480
Desc Sociedad De Fomento Indl* 28,000 142,856
Empaques Ponderosa SA 51,000 130,101
Empressa Ica Sociedad ADR 8,700 134,850
Fomento Economico Mexicano-Ser B NPV 15,000 39,000
Gruma SA* 30,000 124,899
Grupo Carso SA* 16,000 119,184
Grupo Carso SA De CB ADR (144A) (a) 5,450 81,555
Grupo Condumex SA Ser A 2,500 14,439
Grupo Elektra SA De C.V.* 12,000 87,428
Grupo Embot de Mexico - SA ADR* 800 11,500
Grupo Fernandez Editores*-Ser B 30,500 32,990
Grupo Financieri Banamex 'B' 33,000 94,284
Grupo Financieri Banamer Accival Series 62,000 183,068
Grupo Financiero Bancomer ADR (144A) (a) 3,600 46,800
Grupo Financiero Bancrecer-B 140,000 119,994
Grupo Financiero Bancrecer-L 44,683 41,493
Grupo Financiero Banorte-C* 67,500 166,327
Grupo Herdez* 210,000 100,296
Grupo Industrial Alfa SA-A* 19,720 189,415
Grupo Industrial Bimbo-Ser A* 4,000 21,837
Grupo Industrial Maseca B 20,000 21,224
Grupo Iusacell SA - Ser L ADR* 1,600 29,800
Grupo Mexico SA Series B 35,000 95,428
Grupo Radio Centro 45,000 67,410
Grupo Sidek SA- Ser B 206,887 465,123
Grupo Situr B* 98,419 202,093
Grupo Situr SA ADR (144A) (a) 3,735 77,353
Grupo Televisa GDS 1,900 60,325
Grupo Tribasa SA ADR* 900 14,963
Grupo Tribasa SA- Ser Cpo* 23,000 194,796
Hylsamex ADR (144A)* (a) 3,900 83,850
Ingenieros Civiles Asociados* 5,000 80,612
Kimberly Clark Mex 3,000 35,694
Organizacion Soria 58,700 70,440
Panamerican Beverages Inc-A 2,800 88,550
Sistema Argos Ser B 30,000 27,552
Telefonos de Mexico ADR 15,750 645,750
Tolmex SA De Cv 9,000 77,142
Transport Maritima Mex-ADS-L ADR 14,400 109,800
Vitro SA 76,000 353,635
Vitro Sociedad Anonima ADR 4,300 60,200
Total 5,950,110
Pakistan - 0.8%
Adamjee Insurance Co 3,000 18,135
Bank Of Punjab* 13,000 23,238
Dewan Salman Fibre 13,800 63,098
Engro Chemical Pakistan Ltd. 3,400 25,415
Fauji Fertilizer* 18,500 49,543
Nishat Textile Mills* 43,000 77,912
Packages Ltd.* 9,900 53,089
Pakistan Fund* 4,000 29,500
Pakistan State Oil Co. Ltd. 4,500 65,062
Pakistan Telecommunications (144A)* (a) 100 17,961
Total 422,953
Peru - 1.0%
Banco de Credito del Peru 34,000 75,097
Cia de Minas Buenaventura SA* 20,200 104,339
Compania Goodyear del Peru* 2,300 8,469
Comp. Nacional de Cerveza* 118,595 89,302
Minsur- Class T* 3,735 37,384
Pacifico Peru Suiz* 2,430 89,403
Peruana Telefonos* 20,857 24,194
San Juan Brewery- Class C 18,200 37,019
Southern Peru Copper Corp.* 4,500 24,656
Total 489,863
Philippine Islands - 1.1%
Ayala Land Inc "B" 71,200 111,798
Engineering Equipment Inc. 281,400 28,140
Manila Electirc Class B 9,600 132,893
Metropolitan Bank & Trust 2,120 60,884
Philex Mining Corp. B* 1,006,200 166,325
Philippine Long Distance Tel ADR 1,200 66,150
Total 566,190
Poland - 0.5%
First Polsko Amerykanski Bank 1,749 34,248
Prochnik* 2,950 32,576
Swarzeds* 6,000 49,261
Wedel* 1,400 90,805
Zaklady Piwowarskie W Zywcu* 1,030 67,863
Total 274,753
Portugal - 2.0%
Banco Comercial Portugues-R* 10,700 139,886
Banco Espirito 4,000 77,436
Cia Industrial Ceramica SA* 2,200 24,199
Cimentos de Portugal SA* 2,600 45,921
Cin-Corp. Industrial do Norte 2,800 80,076
Corticeira Amorim* 7,400 123,303
Empresa Fabril de Maquinas 7,000 83,595
Engil Soc Construcao Civil 2,800 39,598
Fab de Vid Barbosa & Almeida* 1,300 36,680
Lusotur* 2,300 46,260
Modelo Supermer* 835 25,454
Soc Metropolitana de Construct* 3,500 55,018
Sonae Industria e Investimento* 10,400 239,310
Total 1,016,736
Puerto Rico - 0.1%
Cellular Comm of Puerto Rico*
Total 1,900 63,650
Singapore - 1.7%
Chuan Hup Holdings 255,000 229,271
GP Batteries 40,000 110,000
Ipco International Limited 5,000 21,000
Santeh Ltd. 189,000 154,356
Sembawang Shipyard 4,000 29,924
Singapore Aerospace 20,000 34,180
Wing Tai Holdings 164,000 290,411
Total 869,142
Taiwan - 0.7%
ROC Taiwan
Total 30,500 362,188
Thailand - 5.2%
Advanced Info Services 3,200 44,375
Advanced Info Services (FB) 5,000 68,540
Alucon Mfg Co. - For. Shares 15,000 68,739
Bangkok Bank-Alien Mkt 39,500 421,836
Bangkok First Inv & Trust (L) 3,200 39,530
Bank Of Asia-For. Reg 31,000 74,735
Bank Of Ayudhya-For. Reg 23,000 94,401
Chareon Pokphand Feed-Alien 5,000 31,281
First Pacific Land Co. Ltd. 50,542 28,197
First Pacific Land Ltd.-For. 152,116 84,866
Industrial Finance Corp. (FB) 88,666 189,027
Krung Thai Bank Ltd. (Local) 40,000 132,296
Land & House Plc Alien Market 2,000 35,704
M.D.X. Co. Ltd.- Foreign Board 37,400 126,678
Phatra Thanakit Co.-For. Shares 21,000 162,343
Precious Shipping* 3,700 43,937
Property Perfect (FB)* 13,227 154,961
Ramkamhaeng Hospital Co. Ltd.-F 29,800 60,563
Regional Container Lines-For. Shares 5,400 86,503
Saha Union Corp. Ltd.-For. Reg 101,000 111,686
Siam Syntech Construction-Fb 36,300 94,024
Telecom Asia Local* 15,600 43,515
Telecomasia Corp.-For. Reg* 15,500 43,236
Thai Farmers Bank Alien Market 29,000 235,744
Thai Military Bank Ltd. -For. Shares 15,000 63,358
Thai-German Ceramic Indus Co. 16,000 47,498
Total 2,587,573
Turkey - 0.9%
Akbank T.A.S. 676,750 184,550
Dardanel* 10,000 14,026
Dis Ticaret Bankasi 1,885,000 110,084
Izocam 68,400 15,103
Koc Yatirim Ve Anayi Mamull 98,000 76,362
Sarkuysan Elektrolitik Bakir 51,000 29,803
Total 429,928
Venezuela - 0.8%
Corimon C.A. ADR 15,600 142,350
Mavesa SA ADR (144A) (a) 29,600 146,366
Sivensa ADR 61,800 99,863
Total 388,579
Total Common Stock (Cost - $46,796,963) 40,920,207
Preferred Stock - 3.4%
Antarctica da Paraiba* (Brazil) 120,000 28,368
Banco do Brazil* (Brazil) 2,300,000 45,310
Celg Class B (Brazil) 357,000 17,707
Cia Energetica de Minas Ger* (Brazil) 300,000 27,300
Cosigua-Siderur Guanabara (Brazil) 3,185,000 97,780
Delta Dairy-SA (Greece) 4,000 71,170
Electrobras* (Brazil) 770,000 272,118
IAP SA* (Brazil) 1,215,000 40,217
Infustrias de Papel Simao SA* (Brazil) 500,000 21,850
Intracom SA Preferred (Greece) 1,000 27,021
Itausa-Investimentos Itau (Brazil) 30,000 17,730
Iven SA (Brazil) 198,000 85,180
Lojas Americanas SA Pref* (Brazil) 4,390,000 129,944
Mangels Industrial SA (Brazil) 6,000,000 36,000
Marcopolo SA (Brazil) 80,000 25,528
Mautner Markhof Nahrung (Austria) 50 15,131
Melpaper SA* (Brazil) 118,000 62,764
Michaniki SA Pfd (Greece) 10,100 127,011
Petroleo Ipiranga (Brazil) 1,600,000 28,000
Pettenati SA-Indus Text* (Brazil) 400,000 25,040
Pranapanema SA Mineracao Ind (Brazil) 1,300,000 22,750
Refrigeracao Parana S.A (Brazil) 14,525,000 47,933
Telebras Brc (Brazil) 7,751,713 347,277
Telecomunicacoes de Sao Paulo (Brazil) 120,000 17,088
Vale Do Rio Doce (Brazil) 290,000 55,533
Total (Cost - $1,741,554) 1,691,750
Rights - 0.0%
Intracom Preferred* (Greece)
Total (Cost - $0) 1,000 83
Warrants - 0.0%
Kian Joo Can Factory Warrants* (Malaysi 4,200 3,278
South India Viscose Warrants* (India) 4,200 6,300
Total (Cost - $14,566) 9,578
Face
Amount
Bonds - 4.3%
Acer Inc, 4.00% due 6/10/01 (Taiwan) 150,000 357,188
Banco de Colombia 144A, 5.20% due 2/1/99
(Colombia)(a) 80,000 74,000
Essar Gujarat Ltd., 5.50% due 8/5/98 (India) 190,000 328,450
Gujarat Ambuja Cement, 3.50% due 6/30/99(India) 225,000 336,656
Pacific Construction Co. Cnv, 2.13% due
10/1/98 (Taiwan) 300,000 248,269
Ssangyong Oil Refining, 3.74% due
12/31/08 (Korea) 65,000 69,225
Teco Elec & Machine Cnv 144A, 2.75% due
4/15/04 (Taiwan)(a) 40,000 38,800
U-Ming Marine, 1.50% due 2/7/01 (Taiwan) 144,000 157,590
United Micro Elect, 1.25% due 6/8/04
(Taiwan) 348,000 538,312
Total (Cost - $2,134,559) 2,148,490
Total Long-Term Investments (Cost - $50,687,642) 44,770,108
Short-Term Investments - 19.3%
Bank of New York TD, 4.74% due 1/3/95 167,244 167,244
Cash equivalents held as collateral for
loaned securities 2,944,320 2,944,320
Prudential-Bache Repurchase Agreement, 5.65% due 1/3/95; Issued 12/30/94
(Collateralized by FMAC and FNMA Notes, 0.0% to 10.5% due
12/1/00 to 1/15/24 with a market value
of $2,095,000) 2,053,890 2,053,890
U.S. Treasury Bill, 6.16% due 6/1/95 2,350,000 2,288,947
U.S. Treasury Bill, 6.575% due 12/14/95 2,350,000 2,199,964
Total (Cost - $9,655,865) 9,654,365
Total Investments - 108.8% (Cost - $60,343,507) 54,424,473
Other Assets and Liabilities - (8.8%)
Other Assets 563,099
Unamortized organization cost 14,883
Payable for securities purchased (1,855,062)
Collateral on securities loaned (2,944,320)
Other liabilities (170,856)
Other assets and liabilities, net (4,392,256)
Net Assets - 100.0%
Applicable to 5,413,622 outstanding $.001 par value shares
(authorized 500,000,000 shares) 50,032,217
Net asset value per share 9.24
Components of Net Assets as of December 31, 1994 were as follows:
Capital stock at par value ($.001) 5,413
Capital stock in excess of par value 56,211,446
Undistributed net investment income 36,226
Accumulated net realized gain (loss) on investments (303,042)
Net unrealized (depreciation) on investments and translation of assets
and liabilities in foreign currencies (5,917,826)
50,032,217
* Non-income producing security
+ See Note 2 to the Financial Statements
ADR American Depositary Receipt
ADS American Depositary Share
GDR Global Depositary Receipt
GDS Global Depositary Share
(a) Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers.
At December 31, 1994, these securities were valued at $2,074,340 or 4.1%
of net assets.
See Notes to Financial Statements
TIFF BOND FUND
Graph: Comparison of change in value of $10,000 Investment in TIFF BOND
Fund and the Lehman Aggregate Bond Index where the X-axis extends from 5/31/94
to 12/31/94 and the Y-axis extends from $9,900 to $10,300.
Performance Evaluation - From inception (5/31/94) through 12/31/94, the TIFF
Bond Fund had a total return net of expenses of 0.5%, the return for its
benchmark, the Lehman Aggregate Bond Index, over the same time period
was 0.8%. Managers - The bad news is that, on average, the Fund's
managers have produced only mediocre results to date: one (FFTW) is
comfortably ahead of its benchmark since inception, two are slightly ahead,
and one is slightly behind, prior to the deduction of manager and custodial
fees, which have thus far consumed 0.29% (29 bp) of the Fund's capital.
The good news is that the Fund's rapid growth will put downward pressure
on its expense ratio, as will automatic reductions in manager fees if future
performance proves less than stellar. (All four managers receive
performance-based fees.) Of course, the directors' hope is that reduced
custody costs will be at least partly offset by increased manager fees - fees
that will be rising to reflect improved performance by the fund's managers.
FAI - TIP permits FAI to make modest sector tilts - e.g., to tilt the Fund
toward mortgage-backed securities by allocating more than the neutral 28.9%
to Smith Breeden. With one exception, FAI has refrained from making any
such tilts. The exception has been a small (and thus far winning) tilt toward
foreign bonds via FFTW. The current tilt is 4.85% (FFTW's 9.7%
allocation times foreign bonds' 50% weight in FFTW's benchmark).
Policy Considerations
Long Term - The fund's chief aim is to help foundations weather
deflationary times without being forced to liquidate their equity holdings at
depressed prices. As a form of deflation "insurance," bonds emphasized by
the Fund (intermediate or longer-term, high quality, non-callable) tend to
perform poorly when investors are spooked by unexpected strength in the
economy, as they were throughout much of 1994. Rising bond yields since
bond prices peaked in October 1993 have materially reduced the cost of
deflation protection. This could be an opportune time for foundations that
lack adequate deflation protection to obtain it.
Short Term - Bonds currently offer abnormally high inflation-adjusted yields
that pose stiff competition to equities, and some institutions have elected to
tilt their "swing" portfolios toward bonds, including foreign issues.
TIFF Investment Program, Inc.
TIFF Bond Fund - Statement Of Net Assets
December 31, 1994
Face
Amount (a) Value+
Long-Term Investments - 92.9%
Bonds - 92.7%
Asset-Backed Securities - 1.9%
Banc One Credit Card, 7.55% due 12/15/9 150000 148,029
Daimler-Benz Vehicle Trust, 5.95% due
12/15/00 177955 174,903
MBNAM 1994 - A, 5.045% due 1/15/02 650000 644,182
Met Life, 7.45% due 11/1/23 (144A) (b) 155000 128,626
SIGMT 1993 -1A, 5.20% due 2/15/02 450000 407,083
Total (Cost - $1,523,778) 1,502,823
Corporate Obligations - 13.4%
Advanta Corp. MTN, 5.125% due 11/15/96 350000 330,605
American Airline, 8.04% due 9/16/11 140000 123,450
Applied Material, 8.00% due 9/1/04 500000 479,124
Aristar Inc., 7.37% due 2/15/97 245000 240,399
Carter Holt Harvey Ltd, 8.875% due 12/1/04
500000 502,931
Carter Holt Harvey Ltd, 9.5% due 12/1/24 305000 311,814
Chemical Bank, 10.375% due 3/15/99 500000 531,883
Chrysler Financial Corp., 13.25%
due 10/15/99 500000 588,547
Commonwealth Edison Co., 8.375%
due 10/15/06 285000 271,320
Consolidated Natural Gas, 8.75% due 6/1/99
590000 600,211
Countrywide Funding MTN, 8.25% due 7/15/02
500000 479,554
Ford Capital, 10.125% due 11/15/00 700000 752,980
W R Grace & Company, 8.00% due 8/15/04 500000 470,863
General Electric Capital Corp. Variable
Rate Note, 6.0% due 8/23/96 500000 499,375
GMAC 1993-AA, 4.15% due 3/16/98 124394 121,415
GMAC 1994-AA, 6.30% due 6/15/99 508878 495,444
Goldman Sachs Group, 6.10% due
4/15/98 (144A) (b) 270000 251,951
Household Bank, 8.45% due 12/10/02 500000 496,026
Hydro-Quebec, 8.05% due 7/7/24 125000 120,116
John Hancock, 7.375% due 2/15/24 (144A)(b)215000 174,166
K-Mart Corp., 8.80% due 7/1/10 155000 151,997
Lehman Brothers Inc, 7.375% due 8/15/97 140000 134,415
Noranda Inc, 8.625% due 7/15/02 185000 183,388
Occidental Petroleum, 6.9375% due 11/4/99 150000 149,850
Occidental Petroleum, 8.5% due 11/9/01 500000 492,804
Panhandle Eastern Corp., 8.625% due
12/1/99 500000 499,892
Penn Central, 10.265% due 4/15/00 250000 261,205
Phillips Electronics, 8.375% due 9/15/06 145000 141,740
Sears Roebuck Co., 8.45% due 11/1/98 500000 499,611
Taubman Realty Group, 8.00% due 6/15/99 185000 178,859
WMC Finance USA, 6.50% due 11/15/03 170000 148,644
Total (Cost - $10,949,466) 10,684,579
Foreign Obligations - 5.4%
Australian Government, 9.00% due 9/15/0 80000 AUD 58,121
Buoni Poliennali Deltes, 9.00% due 10/1/98
260000000 ITL 148,460
Buoni Poliennali Deltes, 8.5% due 4/1/99 120000000 ITL 66,000
Canadian Government, 7.75% due 9/1/99 300000 CAD 203,807
Canadian Government, 6.50% due 6/1/04 40000 CAD 23,838
Deutschland Republic, 7.25% due 10/21/02 1300000 DM 820,747
French Treasury Bill, 7.00% due 11/12/99 3200000 FF 575,357
Japanese Government Bond 140, 6.60% due
6/20/01 20000000 JPY 225,300
Japanese Government Bond 164, 4.10% due
12/22/03 36000000 JPY 350,424
Kingdom of Belgium, 9.00% due 6/27/01 5000000 BF 163,170
Kingdom of Denmark, 9.00% due 11/15/98 400000 DK 66,474
Kingdom of Denmark, 6.00% due 12/10/99 500000 DK 73,662
Mexico Series A, 6.25% due 12/31/19 250000 142,313
Netherlands Government, 6.25% due 7/15/98 300000 NG 167,358
Netherlands Government, 6.75% due 2/15/99 200000 NG 112,898
Skandinaviska Enskilda, 6.87% due 2/15/09 235000 195,521
Spanish Government, 10.25% due 11/30/98 10200000 ESP 74,134
Swedish Government Note, 11.00% due 1/21/99 400000 SK 55,094
Treuhandanstalt, 7.75% due 10/1/02 235000 DM 152,281
U.K. Treasury, 8.00% due 12/7/00 395000 GBP 600,785
Total (Cost - $4,293,835) 4,275,744
U.S. Government/Agency Obligations - 7.6%
Federal Home Loan Bank, 6.20% due 4/26/99 350000 333,351
Federal Home Loan Bank, 8.46% due 12/20/99 200000 199,272
Federal Home Loan Mortgage Corp., 6.14%
due 3/18/99 120000 110,891
Federal Home Loan Mortgage Corp., 7.188%
due 9/15/99 450000 432,451
Federal Home Loan Mortgage Corp., 6.35%
due 3/7/01 510000 459,642
Federal Home Loan Mortgage Corp., 7.00%
due 1/12/25 1600000 1,453,000
Federal National Mortgage Assn., 5.41%
due 6/25/98 1000000 920,538
Federal National Mortgage Assn., 6.60%
due 3/26/01 325000 302,208
Federal National Mortgage Assn., 6.25%
due 8/12/03 145000 126,873
Federal National Mortgage Assn., 6.08%
due 9/3/03 200000 171,566
Federal National Mortgage Assn., 5.95%
due 10/27/08 140000 111,557
Federal National Mortgage Assn., 8.00%
due 1/12/25 800000 766,750
Tennessee Valley Authority, 7.85% due 6/15/44 715000 643,183
Total (Cost - $6,112,385) 6,031,282
U.S. Treasury - 38.5%
U.S. Treasury Bond, 13.875% due 5/15/11 280000 401,975
U.S. Treasury Bond, 9.25% due 2/15/16 150000 168,609
U.S. Treasury Bond, 7.50% due 11/15/16 255000 241,772
U.S. Treasury Bond, 8.75% due 5/15/17 3040000 3,269,901
U.S. Treasury Bond, 8.875% due 8/15/17 625000 680,273
U.S. Treasury Bond, 8.875% due 2/15/19 675000 736,382
U.S. Treasury Bond, 8.125% due 8/15/19 335000 339,188
U.S. Treasury Bond, 7.875% due 2/15/21 225000 221,976
U.S. Treasury Bond, 8.00% due 11/15/21 100000 100,313
U.S. Treasury Bond, 6.25% due 8/15/23 1325000 1,076,146
U.S. Treasury Bond, 7.50% due 11/15/24 1145000 1,094,547
U.S. Treasury Note, 9.25% due 1/15/96 595000 605,598
U.S. Treasury Note, 5.50% due 4/30/96 1010000 984,750
U.S. Treasury Note, 7.375% due 5/15/96 540000 539,155
U.S. Treasury Note, 5.875% due 5/31/96 135000 132,089
U.S. Treasury Note, 6.875% due 10/31/96 1185000 1,168,706
U.S. Treasury Note, 7.25% due 11/30/96 745000 739,179
U.S. Treasury Note, 8.50% due 4/15/97 1200000 1,218,000
U.S. Treasury Note, 6.50% due 5/15/97 1030000 1,001,675
U.S. Treasury Note, 8.50% due 5/15/97 1060000 1,075,567
U.S. Treasury Note, 6.50% due 8/15/97 1460000 1,415,742
U.S. Treasury Note, 5.625% due 8/31/97 430000 407,827
U.S. Treasury Note, 5.75% due 10/31/97 705000 668,869
U.S. Treasury Note, 5.125% due 4/30/98 3000000 2,765,625
U.S. Treasury Note, 5.375% due 5/31/98 1215000 1,126,531
U.S. Treasury Note, 5.125% due 11/30/98 2110000 1,920,100
U.S. Treasury Note, 5.875% due 3/31/99 515000 478,466
U.S. Treasury Note, 6.875% due 7/31/99 1145000 1,102,778
U.S. Treasury Note, 6.00% due 10/15/99 1315000 1,220,073
U.S. Treasury Note, 7.75% due 11/30/99+ 760000 757,306
U.S. Treasury Note, 7.50% due 11/15/01 540000 530,043
U.S. Treasury Note, 5.75% due 8/15/03 1135000 986,384
U.S. Treasury Note, 7.25% due 8/15/04 685000 657,385
U.S. Treasury Note, 7.875% due 11/15/04 435000 436,223
U.S. Treasury Strip, 8.09% due 5/15/13# 550000 128,182
U.S. Treasury Strip, 8.551% due 8/15/13 1000000 228,449
U.S. Treasury Strip, 7.375% due 2/15/15 230000 45,984
Total (Cost - $30,921,768) 30,671,768
Mortgage-Backed - 25.9%
Federal Home Loan Mortgage Corp., 7.00%
due 5/1/09++ 1918869 1,801,942
Federal Home Loan Mortgage Corp.,
due 6/1/09++ 958219 899,830
Federal Home Loan Mortgage Corp.
(Int. Only), 3.925% due 12/15/22 881778 156,377
Federal Home Loan Mortgage Corp., 7.50%
due 4/1/24 300000 280,619
Federal Home Loan Mortgage Corp., 7.50%
due 4/1/24 950000 888,628
Federal Home Loan Mortgage Corp., 7.50%
due 8/1/24 702594 657,206
Federal Home Loan Mortgage Corp., 8.50%
due 9/1/24 301978 297,334
Federal Home Loan Mortgage Corp., 8.50%
due 9/1/24 1008634 993,122
Federal Home Loan Mortgage Corp., 7.50%
due 12/1/24 454500 425,139
Federal National Mortgage Assn., 12.25%
due 1/1/11 178152 196,051
Federal National Mortgage Assn., 7.00%
due 2/1/24 812712 738,428
Federal National Mortgage Assn., 7.00%
due 2/1/24 504999 458,841
Federal National Mortgage Assn., 8.00%
due 5/1/24 970808 930,956
Federal National Mortgage Assn., 8.50%
due 11/1/24 1009432 991,699
Federal National Mortgage Assn., 8.50%
due 12/1/24 450915 442,994
Federal National Mortgage Assn., 8.00%
due 12/1/24 990000 949,359
Government National Mortgage Assn.,
(TBA) 6.50% ++,= 2000000 1,923,438
Government National Mortgage Assn.,
(TBA) 6.50% due 1/24/15++,= 1000000 963,750
Government National Mortgage Assn.,
7.00% due 7/15/23 593745 533,695
Government National Mortgage Assn.,
7.00% due 5/15/24++ 492681 442,852
Government National Mortgage Assn.,
7.00% due 5/15/24++ 985237 885,591
Government National Mortgage Assn.,
7.00% due 6/15/24++ 984525 884,951
Government National Mortgage Assn.,
9.5% due 10/15/24 1028268 1,064,002
Government National Mortgage Assn.,
(TBA) 7.00% due 2/22/25++,= 1000000 978,750
Government National Mortgage Assn.,
(TBA) 7.00% due 3/21/25= 1900000 1,853,684
Total (Cost -$20,992,581) 20,639,238
Total Bonds (Cost - $74,793,104) 73,805,434
Preferred Stocks - 0.2%
Shares Value+
Grand Metro Delaware, 9.42% Preferred Stock
(Cost - $165,000) 6600 168,300
Total Long-Term Investments (Cost - $74,958,104) 73,973,734
Short-Term Investments - 20.0% Face
Amount
Bank Obligations - 7.1%
Bank of Boston Nassau TD, 5.00% due 1/3/95++ 1956000 1,956,000
Cash equivalents held as collateral for
loaned securities 2716275 2,716,275
Bank of New York TD, 4.74% due 1/3/95 1000000 1,000,000
Total (Cost - $5,672,275) 5,672,275
U.S. Treasury Obligations - 1.1%
US Treasury Bill, 5.56% due 3/30/95++# 20000 19,735
US Treasury Bill, 6.32% due 6/15/95# 450000 437,668
US Treasury Bill, 6.75% due 12/14/95++# 450000 421,270
Total (Cost - $878,442) 878,673
Repurchase Agreements - 11.8%
Morgan Stanley Repurchase Agreement, 6.10% due 1/3/95; Issued 12/30/94
(Collateralized by FNMA, 7.5% due 5/1/07 with a 6500000 6,500,000
of $6,636,470)
Prudential-Bache Repurchase Agreement, 5.65% due 1/3/95; Issued 12/30/94
(Collateralized by $2,981,697 FMAC and FNMA
Notes, 0.0% to 10.5% due 12/1/00 to 1/15/24) 2923185 2,923,185
Total (Cost - $9,423,185) 9,423,185
Total Short-Term Investments (Cost - $15,973,902) 15,974,133
Long Options - 0.0% Contracts
June '95 Eurodollar $93 Put expiring 6/19/95
(Cost - $9,323) 20 20,800
Total Investments - 112.9% (Cost - $90,941,329) 89,968,667
Other Assets & Liabilities - (12.9%)
Receivable from securities sold 5,399,519
Other assets 1,065,579
Payable for securities purchased (13,825,422)
Collateral on securities loaned (2,716,275)
Other liabilities (237,479)
Unamortized organizational costs 16,664
Other assets and liabilities, net (10,297,414)
Net Assets - 100.0%
Applicable to 8,230,405 outstanding $.001 par value shares
(authorized 500,000,000 shares) 79,671,253
Net asset value per share 9.68
Components of Net Assets as of December 31, 1994 were as follows:
Capital Stock at par value ($.001) 8,230
Capital Stock in excess of par value 81,138,299
Undistributed net investment income 13,921
Accumulated net realized (loss) on investments (473,564)
Net unrealized (depreciation) on investments, financial
futures contracts, and translation of assets and liabilities
in foreign currencies (1,015,633)
79,671,253
+ See Note 2 to the Financial Statements
= When-issued security
++ Assets currently held in a segregated account
# Interest rate shown represents yield to maturity at time of purchase
(a) Principal amount stated in US dollars unless otherwise noted
TBA Security is subject to delayed delivery. See Notes to the Financial
Statements
See Notes to the Financial Statements
TIFF SHORT-TERM FUND
Graph: Comparison of change in value of $10,000 Investment in TIFF Short-
Term Fund and the Merrill Lynch 182-Day Treasury Bill Index where the X-axis
extends from 5/31/94 to 12/31/94 and the Y-axis extends from $9,900 to $10,400.
Performance Evaluation - From inception (5/31/94) through 12/31/94, the
TIFF Short-Term Fund had a total return net of expenses of 3.1%, the return
for its benchmark, the Merrill Lynch 182-Day Treasury Bill Index, over the
same time period was 2.8%. The Fund's aim (admittedly modest) is to
outperform its 6-month Treasury Bill benchmark net of all costs. In its first
seven months of operations, it has outperformed this benchmark by 0.3% net
of expenses. This margin would have been larger if the Fund itself were
larger; increased assets would permit fixed costs (e.g., portfolio accounting)
to be spread over a larger asset base. TIP's directors remain hopeful that an
increasing number of foundations will view the Fund as a cost-efficient
alternative to other cash management vehicles. In the meantime, until the
FUND's assets grow, the vendors it employs have agreed to waive fees as
needed to keep the FUNd's overall expense ratio within reasonable bounds.
Policy Considerations
As experienced foundation fiduciaries, directors of TIP and FAI recognize
that many foundations seek to control downward fluctuations in the monetary
value of assets earmarked for spending within twelve months ("current year
spending") by investing them exclusively in cash equivalents. However, TIP
studies of the risk and return characteristics of alternate short-term
investment strategies suggest that a short-term income fund whose average
maturity ranges between the one to three months typical of regulated money
market funds and the six months inherent in the TIFF Short-Term fund's
performance benchmark arguably comports better with foundations' short-
term investment goals than money market funds per se. Although the market
value of six-month Treasury Bills can decline when short-term interest rates
are rising sharply, there is a very high probability that such instruments will
produce positive total returns in any given month, and a near certainty that
they will do so over time horizons exceeding one month. To ensure that the
fund's managers do not take undue risks in their efforts to outperform their
6-month Treasury Bill benchmark, TIP imposes on them a number of
restrictions, including maturity limits which ensure that the average duration
of the fund's holdings does not exceed 6 months. Also, while the Fund may
own debt securities of all grades, not more than 5% of its total assets may be
invested in securities rated below investment grade (i.e., rated below BBB by
S&P or Baa by Moody's). The yield on 6-month Treasury Bills rose during
the fourth quarter of 1994 from 5.42% on September 30 to 6.50% at year-
end, boosting the absolute change in yields for all of 1994 to 3.21% (3.29%
at the beginning of January versus 6.50% at year-end). Although inflation
accelerated also, it did so at a more subdued rate. The net result: higher
real returns to Fund Members.
TIFF Investment Program, Inc.
TIFF Short-Term Fund - Statement Of Net Assets
December 31, 1994
Face
Amount Value+
Short-Term Investments - 98.4%
Bank Obligations - 22.0%
Den Danske Bank TD, 6.00% due 1/3/95 1,500,000 1,500,000
FCC National Bank FRN, 6.38% due 2/20/96 280,000 279,580
Harris Trust & Savings Bank CD, 6.00% due 1/3/95 1,500,000 1,500,000
NationsBank TD, 6.25% due 1/3/95 1,500,000 1,500,000
Republic National Bank of New York TD, 5.875% due 1/ 1,500,000 1,500,000
Societe Generale TD, 5.75% due 1/3/95 1,244,000 1,244,000
Total (Cost - $7,523,804) 7,523,580
Commercial Paper - 4.4%
Koch Industries Inc, 5.95% due 1/3/95#
Total (Cost - $1,499,008) 1,500,000 1,499,008
Corporate Obligations - 1.6%
CIT Group Holdings FRN, 6.52% due 5/2/97 280,000 279,160
General Electric Capital Corp FRN, 6.42% due 5/12/97 280,000 279,160
Total (Cost - $560,000) 558,320
U.S. Government and Agency Obligations - 69.5%
Federal Home Loan Bank DN, 5.75% due 1/3/95# 11,000,000 10,992,972
Federal Home Loan Bank FRN, 6.32% due 9/2/97 500,000 500,000
Federal National Mortgage Assn. DN, 5.69% due 1/6/95 1,600,000 1,598,230
U.S. Treasury Bill, 5.70% due 3/2/95# 25,000 24,771
U.S. Treasury Bill, 5.98% due 6/1/95# 11,000,000 10,714,220
Total (Cost - $23,838,170) 23,830,193
Overnight Investments - 0.9%
Bank of New York TD, 4.74% due 1/3/95 211,888 211,888
Prudential-Bache Repurchase Agreement, 5.65% due 1/3/95
Issued 12/30/94, (Collateralized by FMAC and FNMA Notes,
0.0% to 10.5% due 12/1/00 to 1/15/24 with a mark 108,783 108,783
Total (Cost - $320,671) 320,671
Total Short-Term Investments (Cost - $33,741,653) 33,731,772
Long-Term Investments - 1.6%
U.S. Government Obligations
U.S. Treasury Note, 7.375% due 11/15/97
Total (Cost - $554,313) 560,000 554,225
Total Investments - 100.0% (Cost - $34,295,966) 34,285,997
Other Assets and Liabilities - 0.0%
Other assets 31,268
Unamortized organizational costs 2,743
Other liabilities (36,584)
Other assets and liabilities, net (2,573)
Net Assets - 100.0%
Applicable to 3,428,916 outstanding $.001 par value shares
(authorized 500,000,000 shares) 34,283,424
Net asset value per share 10.00
Components of Net Assets as of December 31, 1994 were as follows:
Capital Stock at par value ($.001) 3,429
Capital Stock in excess of par value 34,295,500
Accumulated net realized loss on investments (5,536)
Net unrealized depreciation on investments (9,969)
34,283,424
+ See Note 2 to the Financial Statements
# Interest rate represents yield to maturity at time of purchase
See Notes to Financial Statements
TIFF Investment Program, Inc.
Statement of Changes in Net Assets
Period From May 31, 1994* to December 31, 1994
<TABLE>
TIFF TIFF TIFF
U.S. Equity International Emerging
Fund Equity Fund Markets Fund
<S>
Increase (decrease) in net assets from operations
<C> <C> <C>
Investment income, net 706,663 373,852 72,654
Net realized gain (loss) from investments,
financial futures contracts, and foreign
currency-related transactions 54,454 (654,908) (32,998)
Net unrealized appreciation (depreciation) on
investments, financial futures contracts, and
on translation of assets and liabilities in
foreign currencies 994,742 (607,472) (5,917,826)
Net increase (decrease) in net assets resulting
from operations 1,755,859 (888,528) (5,878,170)
Distributions to Members from
Investment income, net 706,663 373,852 41,438
Amounts in excess of net investment inc 31,843 46,147 -
Net realized gain on investments,
financial futures contracts, and foreign
currency-related transactions 54,454 - -
Distributions required for excise tax purposes in
excess of net realized gain on investments, financial
futures contracts, and foreign currency-
related transactions 857,680 658,310 297,222
Total distributions 1,650,640 1,078,309 338,660
Capital share transactions, net 58,067,837 91,175,644 56,249,037
Total increase in net assets 58,173,056 89,208,807 50,032,207
Net assets
Beginning of period 10 99,960 10
End of period 58,173,066 89,308,767 50,032,217
Undistributed net investment income - - 36,226
</TABLE>
TIFF TIFF
Bond Fund Short-Term Fund
Increase in net assets from operations
Investment income, net 1,796,149 220,115
Net realized gain (loss) from investments,
options and financial futures contracts,
and foreign currency-related transactions (463,090) 17,020
Net unrealized (depreciation) on
investments, options and financial futures
contracts, and on translation of
assets and liabilities in
foreign currencies (1,015,633) (9,969)
Net increase in net assets resulting
from operations 317,426 227,166
Distributions to Members from
Investment income, net 1,796,149 220,115
Amounts in excess of net investment income 12,110 2,906
Net realized gain on investments, options and
financial futures contracts, and foreign
currency related transactions - 17,020
Amounts in excess of net realized gain on
investments, options and financial futures
contracts, and foreign currency-
related transactions - 5,029
Total Distributions 1,808,259 245,070
Capital share transactions, net 81,162,076 34,301,318
Total increase in net assets 79,671,243 34,283,414
Net assets
Beginning of period 10 10
End of period 79,671,253 34,283,424
Undistributed net investment income 13,921 -
* Commencement of Operations
See Notes To Financial Statements
TIFF Investment Program, Inc.
Statement Of Operations
Period From May 31, 1994* to December 31, 1994
<TABLE>
TIFF TIFF TIFF
U.S. Equity International Emerging
Fund Equity Fund Markets Fund
<S>
Investment income <C> <C> <C>
Interest 786,536 373,963 199,629
Dividends (net of withholding taxes of $54,054 for
International Equity, and $11,455 for Emerging
Markets) 160,814 422,721 204,884
Total investment income 947,350 796,684 404,513
Expenses
Investment advisory fees 41,992 58,731 27,387
Money manager fees 82,963 131,343 176,161
Custodian fees 108,823 214,611 173,695
Administration fees 14,730 20,602 9,609
Transfer agent fees 10,059 9,323 6,294
Legal fees 7,524 11,561 6,368
Audit fees 6,065 8,545 3,843
Insurance expense 6,994 7,246 1,755
State registration filing fees 17,842 32,285 3,400
Amortization of organizational costs 2,244 3,586 1,966
Miscellaneous fees and expenses 589 786 467
Total operating expenses 299,825 498,620 410,945
Waiver of investment advisory, money manager,
administration and custody fees (59,138) (75,789) (79,086)
Total expenses 240,687 422,831 331,859
Investment income, net 706,663 373,852 72,654
Net realized and unrealized gain (loss) on
investments, financial futures contracts, and
foreign currency-related transactions
Net realized gain (loss) on investments (30,822) 144,688 13,758
Net realized (loss) on short sales (72,610) - -
Net realized gain (loss) on financial futures contra 157,886 (497,734) -
Net realized (loss) from foreign currency transactio - (301,862) (46,756)
Net unrealized appreciation (depreciation) on invest 443,975 (778,192) (5,919,034)
Net unrealized appreciation on short sales 265,567 - -
Net unrealized appreciation on financial futures
contracts 285,200 200,441 -
Net unrealized appreciation (depreciation) on translation
of assets and liabilities in foreign currenc - (29,721) 1,208
Net realized and unrealized gain (loss) on
investments, financial futures contracts, and
foreign currency-related transactions 1,049,196 (1,262,380) (5,950,824)
Net increase (decrease) in net assets
resulting from operations 1,755,859 (888,528) (5,878,170)
<FN>
* Commencement of Operations
See Notes To Financial Statements
</FN>
</TABLE>
TIFF TIFF
Bond Fund Short-Term Fund
Investment income
Interest 1,964,680 237,645
Expenses
Investment advisory fees 28,205 1,307
Money manager fees 29,823 8,685
Custodian fees 148,207 53,867
Administration fees 14,841 2,179
Transfer agent fees 7,618 4,432
Legal fees 7,837 1,321
Audit fees 5,685 863
Insurance expense 5,546 817
State registration filing fees 14,930 2,082
Amortization of organizational costs 2,201 363
Miscellaneous fees and expenses 683 110
Total operating expenses 265,576 76,026
Waiver of investment advisory, money manager,
administration and custody fees (97,045) (58,496)
Total expenses 168,531 17,530
Investment income, net 1,796,149 220,115
Net realized and unrealized gain (loss)
on investments, financial
futures contracts, and foreign
currency-related transactions
Net realized gain (loss) on investments (372,826) 2,288
Net realized gain (loss) on financial futures
contracts (39,058) 14,732
Net realized (loss) from foreign currency
transaction (51,206) -
Net unrealized (depreciation) on investments (972,663) (9,969)
Net unrealized (depreciation) on financial
futures contracts (6,097) -
Net unrealized (depreciation) on translation of
assets and liabilities in foreign
currencies (36,873) -
Net realized and unrealized gain (loss)
on investments, financial
futures contracts, and foreign
currency-related transactions (1,478,723) 7,051
Net increase in net assets
resulting from operations 317,426 227,166
TIFF Investment Program, Inc.
Financial Highlights
Period From May 31,1994* to December 31, 1994
<TABLE>
<S> TIFF TIFF TIFF
For a share outstanding U.S. Equity International Emerging
throughout the period Fund Equity Fund Markets Fund
Per Share Data <C> <C> <C>
Net asset value, beginning of period 10.00 10.00 10.00
Income From Investment Operations
Investment income, net+ 0.15 0.05 0.01
Net realized and unrealized gain
(loss) on investments, options,
and financial futures contracts 0.19 0.06 (0.71)
Total from investment operations 0.34 0.11 (0.70)
Less Distributions From
Investment income, net 0.15 0.04 0.01
Amounts in excess of net gain on
investments, options, and financial
futures contracts 0.00 # 0.01 -
Net realized and unrealized gain
on investments, options,
and financial futures contracts 0.01 - -
Amounts in excess of net realized
and unrealized gain on investments, options,
and financial futures contracts 0.16 0.08 0.05
Total Distributions 0.31 0.13 0.06
Net asset value, end of period 10.02 9.98 9.24
Total Return (c) 3.49% (b) 0.98%(b) -6.97%(b)
Ratios/Supplemental Data
Net assets, end of period 58,173,066 89,308,767 50,032,217
Ratio of expenses to average net assets 0.85% (a) 1.08%(a) 1.83%(a)
Ratio of expenses to average net assets
before expense waiver 1.06% (a) 1.27%(a) 2.25%(a)
Ratio of net investment income to
average net assets 2.52% (a) 0.95%(a) 0.40%(a)
Portfolio turnover 44.59% (b) 14.71%(b) 26.37%(b)
+ Net of waivers which amounted to: 0.01 0.01 0.01
</TABLE>
For a share outstanding TIFF TIFF
throughout the period Bond Fund Short-Term Fund
Per Share Data
Net asset value, beginning of period 10.00 10.00
Income From Investment Operations
Investment income, net+ 0.36 0.28
Net realized and unrealized gain (loss) on
investments, options, and financial
futures contracts (0.32) 0.02
Total from investment operations 0.04 0.30
Less Distributions From
Investment income, net 0.36 0.28
Amounts in excess of net investment
income 0.00 # 0.00 #
Net realized and unrealized gain on investments
options, and financial futures contracts - 0.01
Amounts in excess of net gain on
investments, options, and financial
futures contracts - 0.01
Total Distributions 0.36 0.30
Net asset value, end of period 9.68 10.00
Total Return (c) 0.46% (b) 3.10%(b)
Ratios/Supplemental Data
Net assets, end of period 79,671,253 34,283,424
Ratio of expenses to average net assets 0.62% (a) 0.40%(a)
Ratio of expenses to average net assets
before expense waivers 0.94% (a) 1.72%(a)
Ratio of net investment income to
average net assets 6.37% (a) 4.98%(a)
Portfolio turnover 162.06% (b) n/a
+ Net of waivers which amounted to: 0.02 0.08
(a) Annualized
(b) Not annualized
(c) Total return would be lower had certain expenses not been waived or
reimbursed
n/a Not applicable
# Rounds to less than .01
* Commencement of Operations
See Notes To Financial Statements
1. Organization
TIFF Investment Program, Inc. ("TIP") was organized as a Maryland
corporation on December 23, 1993 and is registered under the Investment
Company Act of 1940, as amended, as an open-end, management investment
company. TIP currently has five Funds. The five active Funds are: TIFF
U.S. Equity Fund ("U.S. Equity"), TIFF International Equity Fund
("International Equity"), TIFF Emerging Markets Fund ("Emerging
Markets"), TIFF Bond Fund ("Bond"), and TIFF Short-Term Fund ("Short-
Term"). The costs incurred by the Fund in connection with the organization
and initial registration of shares are being amortized on a straight-line basis
over a sixty-month period. The unamortized balance of organizational
expenses at December 31, 1994 was $78,430.
2. Summary of Significant Accounting Policies
Securities
All securities transactions are recorded on a trade date basis. Interest income
and expense are recorded on an accrual basis. The Funds amortize discount
or premium on a daily basis to interest income. Dividend income is recorded
on the ex-dividend date, except certain dividends from foreign securities
which are recorded as soon as the funds are notified. The Funds use the
specific identification method for determining gain or loss on sales of
securities.
Income Tax
There is no provision for Federal income or excise tax since each Fund will
elect to be taxed as a regulated investment company ("RIC") and intends to
comply with the requirements of Subchapter M of the Internal Revenue Code
applicable to RICs and to distribute all of its taxable income. Net realized
losses attributable to security transactions after October 31 are treated as
arising on the first day of the Fund's next fiscal year. The Fund may be
subject to foreign taxes on income, gains on investments or currency
repatriation. The Fund accrues such taxes as applicable. At December 31,
1994 the Bond Fund had a capital loss carry forward of $151,717 which may
be available to offset future realized capital gains, if any. This amount will
expire December 31, 2002.
Valuation
All investments are valued daily at their market price, which results in
unrealized gains or losses. Securities traded on an exchange are valued at
their last sales price on that exchange. Securities for which over-the-counter
market quotations are available are valued at the latest bid price. Deposits,
repurchase agreements and reverse repurchase agreements are generally
valued at their cost plus accrued interest. Securities purchased with sixty
days or less to maturity are priced at amortized cost which approximates fair
value. The value of other investments is determined under procedures
established by the Fund's Board of Directors.
Expenses
Expenses directly attributed to each Fund are charged to that Fund's
operations; expenses which are applicable to all Funds are allocated among
them based on their respective average daily net assets. The investment
adviser waived $6,593 and $1,307 in fees, respectively, and the administrator
waived $1,496 and $2,179, respectively, for the Emerging Markets and Short
Term Funds. Money Managers waived $8,685 in fees in the Short-Term
Fund. The custodian waived $59,138, $75,789, $70,997, $97,045, and
$46,325 in the U.S. Equity, International Equity, Emerging Markets, Bond,
and Short-Term Funds, respectively.
Dividends to Shareholders
It is the policy of Bond and Short-Term, U.S. Equity, International Equity,
and Emerging Markets to declare dividends daily, quarterly, semi-annually,
and annually, respectively, from net investment income. Dividends are paid
in cash or reinvested monthly, quarterly, semi-annually, and annually,
respectively.
Dividends from net short-term capital gains and net long-term capital gains
of each Fund, if any, are normally declared and paid annually, but each Fund
may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code. To the extent that a
net realized capital gain can be reduced by a capital loss carryover, such gain
will not be distributed.
The classification of income and capital gains distributions is determined in
accordance with income tax regulations. Permanent book and tax differences
relating to shareholder distributions will result in reclassifications to paid-
in capital and may affect net investment income per share. Undistributed net
investment income, accumulated net investment loss, or distributions in
excess of net investment income may include temporary book and tax
differences which will reverse in a subsequent period.
Currency Translation
Assets and liabilities denominated in foreign currencies and commitments
under forward exchange currency contracts are translated into U.S. dollars at
the mean of the quoted bid and asked prices of such currencies against the
U.S. dollar. Purchases and sales of portfolio securities are translated at the
rates of exchange prevailing when such securities were acquired or sold.
Income and expenses are translated at exchange rates prevailing when
accrued. Unrealized net currency gains and losses from valuing foreign
currency-denominated assets and liabilities at period-end exchange rates are
reflected as a component of net unrealized appreciation (depreciation).
3. Investment Advisory Agreement and Money Manager Agreements
The Fund's Board of Directors has approved investment management
agreements with FAI. Each Fund pays FAI a maximum monthly fee
calculated by applying the following annual basis point ("bp") rates to such
Fund's average daily net assets for the month (100 bp equals 1.00%):
<TABLE>
<S> <C> <C> <C> <C> <C>
U.S. Int'l Emerging Short-
Assets Equity Equity Markets Bond Term
(bp) (bp) (bp) (bp) (bp)
On the first $500 mil 15 15 15 10 3
On the next $500 mil. 13 13 13 8 3
On the next $500 mil. 11 11 11 6 2
On the next $500 mil. 9 9 9 5 2
On the next $500 mil. 7 7 7 4 1
On the remainder
(>$2.5 Billion) 5 5 5 3 1
</TABLE>
The Fund's Board of Directors has approved Money Manager agreements
with each of the money managers. Money Managers will receive annual
management fees equal to a stated percentage of the value of Fund assets
under management that is adjusted upwards or downwards, proportionately,
to reflect actual investment performance over the applicable time period
relative to a chosen benchmark rate of return. Certain Money Managers,
however, will receive management fees equal to a flat percentage per annum
of assets under management.
The following identifies Money Managers who provide services to the Funds
and the minimum and maximum fee rate. Unless otherwise indicated, the
management fee received by a Money Manager varies based on the Money
Manager's investment performance:
Fee as % of Assets Managed
Minimum Maximum
TIFF U.S. Equity Fund
Aronson + Fogler Investment Management 0.10% 0.80%
Eagle Capital Management 0.00 2.00
First Quadrant 0.15 3.00
Investment Research Company (Hi Cap) 0.10 1.20
Investment Research Company (Long/Short 0.10 2.00
Jacobs Levy Equity Management 0.15 1.25
Kayne, Anderson Investment Management, 0.15 0.65
Martingale Asset Management, L.P. .05* 0.10
Palo Alto Investors 0.10 2.00
Turner Investment Partners, Inc. 0.15 1.50
Westport Assets Management, Inc. 0.15 2.00
TIFF International Equity Fund
Blairlogie Capital Management Ltd. .60* 0.95
Delaware International Advisers Ltd. .30* 0.50
Harding, Loevner Management L.P. 0.10 1.50
Marathon Asset Management Ltd. 0.15 1.60
Warburg Investment Management Int'l Ltd .5* 0.50
TIFF Emerging Markets Fund
BEA Associates .60* 0.95
Blairlogie Capital Management Ltd. .60* 0.95
Emerging Markets Management 1.00 1.25
Genesis Asset Managers, Ltd. .60* 1.10
TIFF Bond Fund
Atlantic Asset Management Partners, Inc 0.10 0.60
Fischer Francis Trees & Watts, Inc. 0.10 0.80
Seix Investments Advisors, Inc. 0.10 0.80
Smith Breeden Associates, Inc. 0.10 0.85
TIFF Short-Term Fund
Fischer Francis Trees & Watts, Inc. .15* 0.20
Smith Breeden Associates, Inc. 0.05 0.75
*Money Manager receives a fee that does not include performance component. The
minimum fee relects "breakpoints" and is applied only to assests in excess of
the highest "breakpoint".
Pursuant to its Administration Agreement, AMT Capital Services, two
employees of which serve as officers of TIP, earns a fee for providing Fund
administration services to the Fund according to the following schedule:
0.07% of the average daily net assets of TIP for the first $300 million, 0.05%
for the next $2.7 billion, 0.04% for the next $2.0 billion, and 0.03% for the
average daily net assets over $5.0 billion under management.
4. Investment Transactions
Purchase cost and proceeds from sales of investment securities, other than
short-term investments, for the period from May 31, 1994 (commencement of
operations) to December 31, 1994 were as follows:
Fund Purchases Sales
U.S. Gov't Other U.S. Gov't Other
U.S. Equity 25,385,896 70,710,143 32,598 10,587,269
International Equity 3,275,646 82,291,862 - 10,194,212
Emerging Markets 267,116 57,582,814 266,595 6,655,529
Bond 120,381,662 33,604,003 60,885,607 16,851,885
Short Term 82,754,936 839,504 82,204,989 -
The components of net unrealized appreciation (depreciation) of investments
based on Federal tax cost noted below at December 31, 1994 for each Portfolio
were as follows:
Net Apprec. Cost for Federal
Fund Appreciation Depreciation (depreciation) Tax Purposes
U.S. Equity 1,737,663 1,337,572 400,091 78,586,472
International Equity 3,167,419 40,434,422 (876,003) 93,986,100
Emerging Markets 1,405,190 7,405,525 (6,000,335) 60,424,808
Bond 103,432 1,209,486 1,106,054 91,074,720
Short Term 12 10,487 (10,475) 34,296,472
Forward Foreign Exchange Currency Contracts
The Funds enter into forward foreign exchange currency contracts
in order to hedge exposure to changes in foreign currency exchange
rates on foreign portfolio holdings. A forward exchange contract
is a commitment to purchase or sell a foreign currency at a
future date at a negotiated forward rate. Fluctuations in the value of forward
foreign currency contracts are recorded for book purposes as unrealized gains
or losses by the Funds. Risks may arise from the potential inability of a
counterparty to meet the terms of a contract and from unanticipated
movements in the value of a foreign currency relative to the U.S. dollar.
At December 31, 1994, International Equity had outstanding forward foreign
exchange currency contracts to sell foreign currencies, as follows:
<TABLE>
Contract Cost / Current Appreciation
Amount Proceeds Value (Depreciation)
Foward Foreign Exchange Sell Contracts
<C> <S> <C> <C> <C>
450,497 Great Britain Pound expiring 2/28/9 706,000 705,817 183
207,610,200 Indonesian Rupiah expiring 1/3/95 94,379 94,497 (118)
112,685,000 Japanese Yen expiring 2/28/95 1,154,000 1,141,114 12,886
163,873,200 Japanese Yen expiring 7/21/95 1,700,000 1,701,763 (1,763)
142,170,000 Japanese Yen expiring 1/4/96 1,500,000 1,535,811 (35,811)
818,023 Netherlands Guilder expiring 2/28/9 470,000 475,263 (5,263)
(29,886)
At December 31, 1994, Emerging Markets had outstanding forward foreign
exchange currency contracts to purchase foreign currencies as follows:
Unrealized
Contract Cost / Current Appreciation
Amount Proceeds Value (Depreciation)
Foward Foreign Exchange Buy Contracts
1,783,169 Austrian Schilling expires 1/3/95 160,827 163,537 2,710
</TABLE>
At December 31, 1994, Bond had outstanding forward foreign exchange
currency contracts to purchase and sell foreign currencies as follows:
<TABLE> <C>
<C> <S> <C> <C> Unrealized
Contract Cost / Current Appreciation
Amount Proceeds Value (Depreciation)
Foward Foreign Exchange Buy Contracts
60,000 Canadian Dollar expiring 1/19/95 43,304 42,772 (532)
1,000,000 Danish Krone expiring 1/19/95 161,864 164,487 2,623
1,084,823 French Franc expiring 1/19/95 201,516 203,312 1,795
309,814 German Deutsche Mark expiring 1/19/95 197,157 200,156 2,999
40,766 Great Brittish Pounds expiring 1/19/95 63,678 63,874 196
10,000,000 Italian Lira expiring 1/19/95 6,060 6,164 104
12,714,000 Japanese Yen expiring 1/19/95 126,938 128,015 1,077
20,000,000 Spanish Peseta expiring 1/19/95 151,297 151,791 494
Foward Foreign Exchange Sell Contracts
75,000 Australian Dollar expiring 1/19/95 58,275 58,130 145
5,409,700 Belgian Franc expiring 1/19/95 167,487 170,149 (2,662)
421,257 Canadian Dollar expiring 1/19/95 304,324 300,297 4,027
2,009,175 Danish Krone expiring 1/19/95 326,704 330,483 (3,779)
1,660,000 French Franc expiring 1/19/95 307,978 311,108 (3,130)
2,453,335 German Deutsche Mark expiring 1/19/ 1,562,579 1,584,978 (22,399)
221,544 Great Brittish Pounds expiring 1/19 346,532 347,123 (591)
24,738,600 Japanese Yen expiring 1/19/95 247,251 249,088 (1,837)
518,508 Netherlands Guilder expiring 1/19/9 294,639 299,110 (4,471)
1,000,000 Spanish Peseta expiring 1/19/95 7,530 7,590 (60)
603,629 Swedish Krona expiring 1/19/95 80,236 81,204 (968)
(26,969)
</TABLE>
Financial Futures ContractsThe Funds are engaged in trading
financial futures contracts. The Funds are exposed to market risk as a result
of changes in the value of the underlying financial instruments. Investments
in financial futures require a Fund to "mark to market" on a daily basis,
which reflects the change in the market value of the contract at the close of
each day's trading. Accordingly, variation margin payments are made or
received to reflect daily unrealized gains or losses. When the contracts are
closed, the Fund recognizes a realized gain or loss. These investments
require initial margin deposits which consist of cash or cash equivalents,
equal to approximately 5-10% of the contract amount. The Funds each
maintain a segregated account of cash or other securities with the custodian
sufficient to cover its futures positions. The Funds do not employ leverage.
At December 31, 1994, the Funds segregated investments in connection with
their margin accounts with respect to their financial futures contracts in the
following amounts:
Segregated
Fund Assets
U.S. Equity 1,813,939
International Equity 1,677,090
Emerging Markets -
Bond 9,176,305
Short-Term -
At December 31, 1994, U.S. Equity had the following open futures contract:
Current Unrealized
Contracts Cost Value Appreciation
Long Futures Contracts
82 March '95 S&P 500 18,630,150 18,915,350 285,200
At December 31, 1994, International Equity had the following open futures
contracts:
Local Currency Unrealized
Original Current Appreciation
Contracts Cost Value (Depreciation)
Long Futures Contracts
70 March '95 NIKKEI Simex 674,800,000 691,800,000 172,275
25 January '95 CAC 40 9,485,200 9,445,000 (7,533)
32 March '95 NIKKEI CME 3,160,500 3,163,200 2,700
100 March '95 Japanese
Yen CME 12,590,000 12,635,000 45,000
11 March '95 Canadian
Dollars CME 792,000 784,080 (7,920)
7 March '95 TOR 35 Index 755,650 787,500 22,705
6 March '95 FTSE 100 LIFFE 453,325 463,800 16,414
Short Futures Contracts
8 March '95 Swiss Franc
CME (472,063) (479,563) (7,500)
28 March '95 German Mark
CME (2,230,550) (2,266,250) (35,700)
200,441
At December 31, 1994, Bond had the following open futures contracts:
Unrealized
Current Appreciation
Contracts Cost Value (Depreciation)
Long Futures Contracts
11 March '95 5yr Notes 1,101,328 1,101,031 (297)
Short Futures Contracts
8 June '97 CME Euro (1,834,400) (1,836,400) (2,000)
4 June '97 CME Euro (915,400) (919,200) (3,800)
(6,097)
Short Selling
U.S. Equity Fund engages in short-selling which obligates the Fund to
replace the security borrowed by purchasing it at the market price at the time
of replacement. Until the security is replaced, the Fund is required to pay the
lender any dividends declared. The Fund would realize a gain if the security
declines in price between the date of the short sale and the date on which the
Fund replaces the borrowed security. The Fund would incur a loss as a result
of the short sale if the price of the security increases between those dates.
Until the Fund replaces the borrowed security it will maintain a segregated
account of cash and/or U.S. Government securities with its custodian
sufficient to cover its short position.
Options
When a Fund purchases an option, an amount equal to the premium paid by
the Fund is included in the Fund's Statement of Assets and Liabilities as an
investment and subsequently "mark-to-market" to reflect the current market
value of the option purchased. The current market value of a purchased
option is the last sale price on the market on which it is principally traded.
If the purchased option expires, the Fund realizes a loss, in the amount of the
premium. If the Fund enters into a closing sale transaction, it realizes a gain
or loss, depending on whether the proceeds from the sale are greater or less
than the cost of the option.
If the Fund exercises a call option, the cost of the securities acquired by
exercising the call is increased by the premium paid to buy the call. If the
Fund exercises a put option, it realizes a gain or loss from the sale of the
underlying security and the proceeds from such sale are decreased by the
premium originally paid.
5. Repurchase and Reverse Repurchase Agreements
Each Fund may enter into repurchase agreements under which a bank or
securities firm that is a primary or reporting dealer in U.S. Government
securities agrees, upon entering into a contract, to sell U.S. Government
securities to a Fund and repurchase such securities from such Fund at a
mutually agreed upon price and date.
Each Fund is also permitted to enter into reverse repurchase agreements
under which a primary or reporting dealer in U.S. Government securities
purchases U.S. Government securities from a Fund and such Fund agrees to
repurchase the securities at an agreed upon price and date.
Each Fund will engage in repurchase and reverse repurchase transactions
with parties selected on the basis of such party's creditworthiness. Securities
purchased subject to repurchase agreements 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, such Fund maintains the right to sell the underlying securities at
market value and may claim any resulting loss against the seller.
6. Capital Share Transactions
As of December 31, 1994, there were 2,500,000,000 shares of $0.001 par
value capital stock authorized. Transactions in capital stock were as follows
for the period from May 31, 1994 (commencement of operations) to
December 31,1994:
U.S. Equity Shares Amount
Shares Sold 7,086,212 71,279,804
Shares Reinvested 144,196 1,457,573
Exit/ Entrance Fees 199,369
7,230,408 72,936,746
Shares Redeemed (1,422,881) (14,868,909)
Net Increase 5,807,527 58,067,837
International Equity
Shares Sold 8,847,879 89,586,928
Shares Reinvested 103,473 1,031,628
Exit/ Entrance Fees 676,991
8,951,352 91,295,547
Shares Redeemed (11,928) (119,903)
Net Increase 8,939,424 91,175,644
Emerging Markets
Shares Sold 5,422,431 55,824,172
Shares Reinvested 33,910 313,332
Exit/ Entrance Fees 564,861
5,456,341 56,702,365
Shares Redeemed (42,720) (453,328)
Net Increase 5,413,621 56,249,037
Bond
Shares Sold 8,219,984 81,065,201
Shares Reinvested 65,194 638,070
8,285,178 81,703,271
Shares Redeemed (54,774) (541,195)
Net Increase 8,230,404 81,162,076
Short Term
Shares Sold 3,559,046 35,605,027
Shares Reinvested 9,582 95,921
3,568,628 35,700,948
Shares Redeemed (139,713) (1,399,630)
Net Increase 3,428,915 34,301,318
7. Security Lending
The Funds receive securities issued or guaranteed by the
U.S. Government or its agencies, cash or letters of credit as collateral against
the loaned securities, in an amount at least equal to 100% of the current
market value of the loaned securities. At December 31, 1994, all collateral
received was cash and was subsequently invested in cash equivalents.
As of December 31, 1994, the value of the loaned securities outstanding and
the related collateral was as follows:
Value of Loaned
Securities Collateral
Fund ($000) ($000)
U.S. Equity 815,313 1,160,100
International Equity 1,964,893 2,666,916
Emerging Markets 2,241,576 2,944,320
Bond 2,639,804 2,716,275
Short-Term - -
8. Delayed Delivery Transactions The Funds may purchase or sell securities
on a when-issued or forward commitment basis. Payment and delivery may
take place a month or more after the date of the transaction. The price of the
underlying securities and the date when the securities will be delivered and
paid for are fixed at the time the transaction is negotiated. The Fund
identifies securities as segregated in its custodial records with a value at
least equal to the amount of the purchase commitment.
Bond Fund enters into "TBA" (to be announced) purchase commitments to
purchase securities for a fixed unit price at a future date beyond customary
settlement time. Although the unit price has been established, the principal
value has not been finalized. However, the amount of the commitment will
not fluctuate more than 2.0% from the principal amount. The Fund holds,
and maintains until the settlement date, cash or high-grade debt obligations
in an amount sufficient to meet the purchase price. TBA purchase
commitments may be considered securities in themselves, and involve a risk
of loss if the value of the security to be purchased declines prior to the
settlement date, which risk is in addition to the risk of decline in the value
of the Fund's other assets. Unsettled TBA purchase commitments are valued at
the current market value of the underlying securities, generally according to
the procedures described under "Valuation" above.
Although the Fund will generally enter into TBA purchase commitments
with the intention of acquiring securities for its portfolio, the Fund may
dispose of a commitment prior to settlement if the Fund's Money Manager
deems it appropriate to do so.
9. Credit Risk in the Emerging Markets
The Emerging Markets Fund's relatively large investment in countries with
limited or developing capital markets may involve greater risks than
investments in more developed markets and the prices of such investments
may be volatile. While the Fund's investment in emerging markets debt is
limited, the yields of these obligations reflect perceived credit risk. The
consequences of political, social, or economic changes in these markets may
have disruptive effects on the market prices of the Fund's investment and the
income they generate, as well as the Fund's ability to repatriate such
amounts.
10. Federal Income Tax Information
The Funds hereby designate long-term capital gain dividends for the purpose
of the dividend paid deduction for the period ended December 31, 1994 as
follows:
Fund Amount
U.S. Equity 664,030
International Equi 196,419
Emerging Markets 297,203
Bond -
Short-Term 7,113
The Funds have elected to defer to its tax year ended December 31, 1995
losses recognized during the period November 1, 1994 to December 31, 1994
as follows:
Fund Amount
U.S. Equity 522,060
International Equity 1,242,098
Emerging Markets 249,091
Bond 210,816
Short-Term 5,030
Report of Independent Accountants
February 28, 1995
To the Board of Directors and Shareholders of the
TIFF Investment Program
In our opinion, the accompanying statements of net assets and the related
statements of operations and of changes in net assets and the financial
highlights present fairly, in all material respects, the financial position of
the TIFF Investment Program (TIP) which consists of TIFF U.S. Equity Fund, TIFF
International Equity Fund, TIFF Emerging Markets Fund, TIFF Bond Fund, and TIFF
Short-Term Fund, at December 31, 1994, the results of their operations, the
changes in their net assets, and their financial highlights for the period May
31, 1994 (commencement of operations) to December 31, 1994, in conformity with
generally accepted accounting principles. These financil statements and the
financial highlights (thereafter referred to as "finacial statements") are the
responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our
audit of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit reasonable
assurance aobut whether the financial statments are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit, which included confirmation of securities owned at December 31, 1994 by
correspondence with the costodian and brokers and the application of
alternative auditing procedures where confirmations from brokers were not
received, provides a reasonable basis for the opinion expressed above.
by: \s\Price Waterhouse LLP
Price Waterhouse LLP
Boston, Massachusetts
ADVISER MONEY MANAGERS
Foundation Advisers, Inc.
P.O. Box 5165 TIFF U.S. Equity Fund
Charlottesville, VA 22905 Aronson + Fogler Investment Management
phone (800) 984-0084 Eagle Capital Management
fax (804) 977-4479 First Quadrant
Investment Research Company
Jacobs Levy Equity Management
CUSTODIAN Kayne, Anderson Investment Management, Inc.
FUND ACCOUNTING AGENT Martingale Asset Management, L.P.
TRANSFER AGENT Palo Alto Investors
DIVIDEND DISBURSING AGENT Turner Investment Partners, Inc.
Investors Bank & Trust Company Westport Asset Management, Inc.
P.O. Box 1537
Boston, MA 02205 TIFF International Equity Fund
Delaware International Advisers, Ltd.
Harding, Loevner Management, L.P.
FUND ADMINISTRATOR Marathon Asset Management, Ltd.
AND DISTRIBUTOR Warburg Investment Management
AMT Capital Services, Inc. International, Ltd.
430 Park Avenue, 17th Floor May also include Money Managers listed
New York, NY 10022 under TIFF Emerging Markets Fund
TIFF Emerging Markets Fund
LEGAL COUNSEL BEA Associates
Dechert Price & Rhoads Blairlogie Capital Management, Ltd.
1500 K Street, N.W. Emerging markets Management
Washington, DC 20005 Genesis Asset Managers, Ltd.
TIFF Bond Fund
INDEPENDENT ACCOUNTANTS Atlantic Asset Management Partners, Inc.
Price Waterhouse LLP Fischer Francis Trees & Watts, Inc.
160 Federal Street Seix Investment Advisors, Inc.
Boston, MA 02110 Smith Breeden Associates, Inc.
TIFF Short-Term Fund
Fischer Francis Trees & Watts, Inc.
Smith Breeden Associates, Inc.
May also manage that portion of U.S. Equity,
International Equity, and Emerging Markets
Funds not yet allocated to equity managers
