<PAGE> 1
MAGNA FUNDS
LETTER TO SHAREHOLDERS
We are pleased to provide you with the 1999 Annual Report for the Magna Funds.
During the year, a new portfolio was added to better serve our shareholders. As
of year-end, the Funds now include the Magna Growth & Income Fund, Magna
Intermediate Government Bond Fund and Magna Money Market Fund.
Fiscal year end August 31, 1999 was a good year for the Magna Funds and for our
shareholders. Net assets under management at the end of the fiscal year were in
excess of $392 million. This was an increase of $246 million over the same
period last year. This growth included increases in the value of the funds'
holdings, as well as increased investments from shareholders.
Magna Growth & Income Fund returned 33.73%(1) over the last 12 months, excluding
sales charges. The Magna Intermediate Government Bond Fund had a total return
- -1.97(2), excluding sales charges. The Magna Money Market Fund had a 7-day yield
of 4.78% for the fiscal year end.
This report includes the Schedule of Investments, comments from the portfolio
managers, and other important information for each fund. We are continuing to
look at adding new portfolios to the fund in an attempt to better serve our
shareholders. We encourage you to read the report and thank you for your
continued support.
Sincerely,
Walter B. Grimm
Walter B. Grimm
President
- ---------------
(1) With a maximum sales charge of 4.00%, the total return for the fiscal year
ended August 31, 1999 would have been 28.36%.
(2) With a maximum sales charge of 4.00%, the total return for the fiscal year
ended August 31, 1999 would have been -5.88%.
<PAGE> 2
MAGNA GROWTH & INCOME FUND
PORTFOLIO MANAGER REPORT
COMMENTS FROM DISCUSSIONS WITH GARY J. GUTHRIE, PORTFOLIO MANAGER
HOW HAS THE FUND PERFORMED The fund has a total return of 6.51%(1) and
OVER THE PAST SIX-MONTHS 33.73%(1), exclusive of sales load for the six
AND ONE YEAR PERIODS? months and one year ended August 31, 1999,
respectively. This compares with the S&P 500 Index
returns of 7.32% and 39.81% for the period. The
average growth and income fund tracked by Lipper
Inc. returned 7.08% and 31.16% for the same six
months and one year periods.
WHAT IS THE COMPOSITION OF The fund is currently invested in 78 companies,
THE PORTFOLIO AT THIS TIME? which represent 33 industries. We are broadly
diversified with the single largest equity holding
at 3.8% of the portfolio while the ten largest
positions represent 27.1%(2) of the portfolio as of
August 31, 1999.
WHAT COMMENTS DO YOU HAVE Investor sentiment on value/cyclical issues waned
ON THE MARKET AND FUND as the focus of concern became pending Federal
PERFORMANCE? Reserve rate hikes. Financial shares were hardest
hit, while new life began to stir in technology
shares.
WHAT IS YOUR OUTLOOK FOR Strength in earnings tempered with further concerns
THE NEXT SIX MONTHS? of year-end Fed action will probably continue the
markets' roller coaster action of the last several
months. Barring any significant Y2K problems, the
focus will remain on the Fed's battle to contain
any building inflationary pressures.
- ---------------
(1) With a maximum sales charge of 4.00%, the total return for the six-month
period would have been 2.26%, and 28.36% for the one year return.
(2) The composition of the Fund's holdings is subject to change.
2
<PAGE> 3
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
IN THE MAGNA GROWTH & INCOME FUND, THE S&P 500 STOCK INDEX AND THE
LIPPER GROWTH & INCOME FUND INDEX
<TABLE>
<CAPTION>
LIPPER GROWTH & INCOME MAGNA GROWTH & INCOME
FUND INDEX FUND S&P 500 STOCK INDEX
---------------------- --------------------- -------------------
<S> <C> <C> <C>
8/31/94 10000 9601 10000
8/31/95 11691 10978 12125
8/31/96 13492 13040 14415
8/31/97 19033 18203 20271
8/31/98 18030 19814 21925
8/31/99 23208 26495.4 30641
</TABLE>
COMPARATIVE TOTAL RETURN
for the periods ended August 31, 1999
<TABLE>
<CAPTION>
1999 One Five Since Inception
YTD Year Year (8/31/94)
--------------------------------------
<S> <C> <C> <C> <C>
Magna Growth &
Income Fund
Without sales
charge............ 6.77% 33.73% 22.51% 22.51%
With sales
charge*........... 2.50% 28.36% 21.52% 21.52%
</TABLE>
* Reflects maximum sales charge of 4.00%.
PAST PERFORMANCE IS NOT PREDICTIVE OF
FUTURE RESULTS.
SECTOR WEIGHTINGS*
AS OF 8/31/99
<TABLE>
<CAPTION>
SHORT-
BASIC TERM PREFERRED
SERVICES RETAIL TECHNOLOGY HEALTH INDUSTRIES INVESTMENTS STOCK CONSUMER UTILITIES
- -------- ------ ---------- ------ ---------- ----------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1.7 1.2 23.1 13.7 3.8 9.2 4.9 9.9 11.8
<CAPTION>
SERVICES ENERGY FINANCE
- -------- ------ -------
<S> <C> <C>
1.7 14.3 7.9
</TABLE>
*Portfolio composition subject to change. Percentages based upon net assets.
The performance of the Magna
Growth & Income Fund is measured
against the Standard & Poor's 500
Index and the Lipper Growth &
Income Fund Index. The S&P 500 is
generally representative of the
performance of the domestic large
capitalization stock universe.
The index does not reflect the
deduction of expenses associated
with a mutual fund, such as
investment management and fund
accounting fees. However, the
Lipper Growth & Income Fund
Index, a managed index, and the
Fund's performance do reflect the
deduction of fees for these
value-added services. The Fund's
total returns would have been
lower had certain fees not been
waived during the periods shown.
Investment return and NAV will
fluctuate, so that an investor's
shares, when redeemed, may be
worth more or less than the
original cost.
3
<PAGE> 4
MAGNA INTERMEDIATE GOVERNMENT BOND FUND
PORTFOLIO MANAGER'S REPORT
COMMENTS FROM A CONVERSATION WITH L. CLARK ZEDRIC, PORTFOLIO MANAGER
HOW DID THE FUND PERFORM The fund provided a total return of (1.97%)(1)
OVER THE PAST 12-MONTHS, exclusive of sales loads, for the 12-month period
AND DURING THE FIRST ended August 31, 1999. In comparison, the Lehman
EIGHT MONTHS OF 1999? Brothers 6-10 Year Government/Corporate Bond Index
rose 0.02% and the Lehman Brothers 1-5 Year
Government/Corporate Bond Index rose 3.36% for the
period.
Through August 31, 1999, the Fund's 1999
year-to-date total return, exclusive sales charges,
was (4.34%).(1) During the same period, the Lehman
Brothers 6-10 Year Government/Corporate Bond Index
lost 3.51%, and the Lehman Brothers 1-5 Year
Government/Corporate Bond Index rose 0.92%.
THE FUND'S 12 MONTH RETURN During the 12 month period, interest rates rose
DECLINED DRAMATICALLY FROM substantially in the 5-10 year range. The ten year
THE SAME PERIOD ONE YEAR bond went from 4.97% the end of August 1998 to
EARLIER. WHAT PRIMARILY 5.98% at month-end August 1999. Because bond values
ACCOUNTED FOR THE rise as interest rates fall, this rise in rates
DECLINE? pushed our total return lower. The fund is
concentrated in the 5-10 year area.
EVEN THOUGH THE FUND Yes. As of August 31, 1999 over 67% of the
DECLINED, YOU WERE ABLE portfolio was invested in Federal Agency Bonds and
TO MAINTAIN A HIGH U.S. Treasury Notes with the remainder in high
QUALITY PORTFOLIO AND A quality corporate paper and cash. The Fund's
RELATIVELY GENEROUS dominant credit rating was AAA; the Fund owns
COUPON RATE. nothing below an A rating. As of August 31, 1999
the average portfolio coupon rate(2) was almost
7.00%.
HOW HAVE YOU POSITIONED THE An essential part of our strategy is to maintain a
FUND FOR THE COMING YEAR? "ladder" with bond maturities spread over several
years. This helps us to lessen the impact of
interest rate fluctuations on the value of the
portfolio and ensures that some bonds mature each
year. We continue the "ladder" strategy and
recently have been extending the length slightly by
purchasing some bonds with 10 to 14 years maturity,
modestly increasing average life and duration. This
action reflects our view that interest rates after
rising a full percentage point in the 5-10 year
range, may increase slightly but then should
decline in the months ahead. We do not want to
deviate from our overall strategy. We feel that
even though the 5-10 year range was the worst
performer in this past year it could very well be
the best in the year ahead.
- ---------------
(1) With a maximum sales charge of 4.00%, the total return for the fiscal year
ended August 31, 1999 would have been (5.88%), and the total return for the
1999 year-to-date period (through August 31, 1999) would have been (8.13%).
(2) The interest rate stated on the face of a bond represents the percentage of
interest to be paid by the issuer on the face value of the bond.
(*) The composition of the Fund's holding is subject to change.
4
<PAGE> 5
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
IN THE MAGNA INTERMEDIATE GOVERNMENT BOND FUND,
THE LEHMAN BROTHERS 1-5-YEAR GOVERNMENT/CORPORATE BOND INDEX AND
THE LEHMAN BROTHERS 6-10-YEAR GOVERNMENT/CORPORATE BOND INDEX
<TABLE>
<CAPTION>
LEHMAN BROTHERS 1-5-YEAR LEHMAN BROTHERS 6-10-YEAR
MAGNA INTERMEDIATE GOVERNMENT/CORPORATE GOVERNMENT/CORPORATE
GOVERNMENT BOND FUND BOND INDEX BOND INDEX
-------------------- ------------------------ -------------------------
<S> <C> <C> <C>
8/31/94 9601 10000 10000
8/31/95 10398 10850 11325
8/31/96 10760 11368 11623
8/31/97 11617 12233 12864
8/31/98 12704 13508 15882
8/31/99 12453.7 13962 15885
</TABLE>
COMPARATIVE TOTAL RETURN
for the periods ended August 31, 1999
<TABLE>
<CAPTION>
1999 One Five Since Inception
YTD Year Year (8/31/94)
--------------------------------------
<S> <C> <C> <C> <C>
Magna Intermediate
Government Bond Fund
Without sales
charge............. (4.34%) (1.97%) 5.34% 5.34%
With sales charge*... (8.13%) (5.88%) 4.49% 4.49%
</TABLE>
* Reflects maximum sales charge of 4.00%.
PAST PERFORMANCE IS NOT PREDICTIVE OF
FUTURE RESULTS.
PORTFOLIO COMPOSITION*
AS OF 8/31/99
<TABLE>
<CAPTION>
CASH AND CASH EQUIVALENTS CORPORATE U.S. GOVERNMENT SECURITIES FEDERAL AGENCY
- ------------------------- --------- -------------------------- --------------
<S> <C> <C> <C>
3.3 31.9 4.3 59.7
</TABLE>
*Portfolio composition
subject to change.
Percentages based upon net
assets.
The performance of the Magna
Intermediate Government Bond Fund
is measured against the Lehman
Brothers 1-5-Year
Government/Corporate Bond Index
and the Lehman Brothers 6-10-Year
Government/Corporate Bond Index;
those two indices are unmanaged
and generally represent a range
of 1-5 and 6-10-year maturities.
These indices do not reflect the
deduction of fees associated with
a mutual fund, such as investment
management and fund accounting
fees. The Fund's performance
reflects the deduction of fees
for these value-added services.
The Fund's total returns would
have been lower had certain fees
not been waived during the
periods shown.
Investment return and NAV will
fluctuate, so that an investor's
shares, when redeemed, may be
worth more or less than the
original cost.
5
<PAGE> 6
MAGNA GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (87.4%):
AEROSPACE/DEFENSE -- (0.8%):
Boeing Company......................................... 25,000 $ 1,132,813
------------
AIR TRAVEL -- (0.7%):
Delta Air Lines, Incorporated.......................... 20,000 1,016,250
------------
ALUMINUM -- (1.3%):
Aluminum Company of America, Incorporated.............. 30,000 1,936,875
------------
AUTOMOBILES & TRUCKS -- (2.0%):
DaimlerChrysler AG..................................... 18,705 1,406,382
Ford Motor Company..................................... 30,000 1,563,750
------------
2,970,132
------------
BREWERY -- (1.3%):
Anheuser-Busch Companies, Incorporated................. 25,000 1,925,000
------------
CHEMICALS -- (3.3%):
DuPont (EI) de Nemours & Company....................... 52,933 3,354,692
Monsanto Company....................................... 35,000 1,437,188
------------
4,791,880
------------
CLOTHING -- (1.2%):
TJX Companies, Incorporated............................ 60,000 1,732,500
------------
COMPUTER SOFTWARE -- (5.8%):
Computer Sciences Corporation*......................... 40,000 2,767,500
Microsoft Corporation*................................. 60,800 5,627,799
------------
8,395,299
------------
COMPUTERS & BUSINESS EQUIPMENT -- (13.3%):
Cisco Systems, Incorporated*........................... 67,500 4,577,344
Compaq Computer Corporation............................ 56,000 1,298,500
Dell Computer Corporation*............................. 80,000 3,905,000
Gateway Inc.*.......................................... 20,000 1,938,750
Hewlett-Packard Company................................ 20,000 2,107,500
Sun Microsystems, Incorporated*........................ 70,000 5,564,999
------------
19,392,093
------------
DIVERSIFIED OPERATIONS -- (2.7%):
General Electric Company............................... 35,000 3,930,938
------------
</TABLE>
continued
6
<PAGE> 7
MAGNA GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (CONTINUED):
DRUGS & HEALTHCARE -- (12.1%):
Amgen, Incorporated*................................... 40,000 $ 3,327,499
Bristol-Myers Squibb Company........................... 40,000 2,815,000
Cardinal Health, Incorporated.......................... 15,000 956,250
Johnson & Johnson...................................... 20,000 2,045,000
Lilly (Eli) & Company.................................. 19,000 1,417,875
Merck & Company, Incorporated.......................... 20,200 1,357,188
Pfizer, Incorporated................................... 81,000 3,057,750
Warner-Lambert Company................................. 40,000 2,650,000
------------
17,626,562
------------
ELECTRONIC COMPONENTS -- (3.2%):
Intel Corporation...................................... 40,000 3,287,500
Applied Materials, Incorporated*....................... 20,000 1,421,250
------------
4,708,750
------------
ENTERTAINMENT -- (1.0%):
Walt Disney Company.................................... 50,000 1,387,500
------------
FINANCE & BANKING -- (5.2%):
Bank Of America Corp................................... 10,000 605,000
Bank One Corporation................................... 13,200 529,650
Chase Manhattan Corporation............................ 30,000 2,510,625
First Union Corporation................................ 30,000 1,245,000
Mellon Bank Corporation................................ 36,600 1,221,525
Southtrust Corporation................................. 20,000 706,250
Wells Fargo Company.................................... 20,000 796,250
------------
7,614,300
------------
FINANCIAL SERVICES -- (1.7%):
Citigroup, Incorporated................................ 7,500 337,028
Fannie Mae............................................. 20,000 1,242,500
Hartford Financial Services Group...................... 20,000 908,750
------------
2,488,278
------------
</TABLE>
continued
7
<PAGE> 8
MAGNA GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (CONTINUED):
FOOD & BEVERAGES -- (2.9%):
Coca-Cola Company...................................... 16,000 $ 957,000
International Paper Company............................ 30,000 1,411,875
PepsiCo, Incorporated.................................. 10,600 361,725
Sara Lee Corporation................................... 70,000 1,553,125
------------
4,283,725
------------
HOUSEHOLD PRODUCTS -- (2.9%):
Dial Corporation....................................... 75,000 2,081,250
Procter & Gamble Company............................... 22,000 2,183,500
------------
4,264,750
------------
INSURANCE -- (1.0%):
Allstate Corporation................................... 45,000 1,476,563
------------
INTERNATIONAL OIL -- (5.1%):
Exxon Corporation...................................... 30,000 2,366,250
Mobil Corporation...................................... 30,200 3,091,725
Texaco, Incorporated................................... 32,000 2,032,000
------------
7,489,975
------------
MEDICAL INSTRUMENTS -- (1.6%):
Medtronic, Incorporated................................ 30,000 2,347,500
------------
MULTIMEDIA -- (1.7%):
Time Warner, Incorporated.............................. 41,600 2,467,400
------------
OIL & GAS -- (3.2%):
Atlantic Richfield Company............................. 20,000 1,758,750
Ultramar Diamond Shamrock Corporation.................. 25,000 653,125
Conoco Class B......................................... 79,847 2,155,788
------------
4,567,663
------------
PAPER -- (1.0%):
Kimberly-Clark Corporation............................. 25,000 1,423,438
------------
RAILROADS -- (0.5%):
Burlington Northern Santa Fe Corporation............... 23,800 690,200
------------
RESTAURANTS -- (0.8%):
McDonald's Corporation................................. 29,400 1,216,425
------------
</TABLE>
continued
8
<PAGE> 9
MAGNA GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
COMMON STOCKS -- (CONTINUED):
TELECOMMUNICATIONS -- (2.5%):
MCI Worldcom, Incorporated*............................ 25,000 $ 1,893,750
Sprint Corporation (PCS)*.............................. 15,000 896,250
Sprint Corporation*.................................... 20,000 887,500
------------
3,677,500
------------
TELECOMMUNICATIONS EQUIPMENT -- (3.2%):
Lucent Technologies, Incorporated...................... 50,000 3,203,124
Tellabs, Incorporated*................................. 25,000 1,489,063
------------
4,692,187
------------
TOBACCO -- (1.0%):
Philip Morris Companies, Incorporated.................. 40,000 1,497,500
------------
UTILITIES -- ELECTRIC -- (1.1%):
GPU, Incorporated...................................... 25,000 853,125
New Century Energies, Incorporated..................... 20,000 722,500
------------
1,575,625
------------
UTILITIES -- TELEPHONE -- (3.3%):
GTE Corporation........................................ 29,500 2,024,438
SBC Communications, Incorporated....................... 29,200 1,401,600
U S West, Incorporated................................. 26,500 1,384,625
------------
4,810,663
------------
TOTAL COMMON STOCKS -- (Cost $71,070,432)................... 127,530,284
------------
PREFERRED STOCKS -- (4.9%):
BANKING -- (0.5%):
Harris Preferred Capital, Series A..................... 30,000 708,750
------------
FINANCIAL SERVICES -- (2.1%):
AT & T Capital Corporation............................. 40,000 1,002,500
MediaOne Financial Trust............................... 40,000 1,030,000
Merrill Lynch Capital Trust............................ 40,000 957,500
------------
2,990,000
------------
INSURANCE -- (0.6%):
Allstate Corporation................................... 35,000 835,625
------------
</TABLE>
continued
9
<PAGE> 10
MAGNA GROWTH & INCOME FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
SHARES OR
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- ------------
<S> <C> <C>
PREFERRED STOCKS -- (CONTINUED):
OIL & GAS -- (0.3%):
UDS Capital, Series I.................................. 20,000 $ 483,750
------------
TELECOMMUNICATIONS -- (0.6%):
Motorola Capital Trust................................. 40,000 892,480
------------
UTILITIES -- (0.8%):
Duke Energy Capital Trust.............................. 30,000 712,500
KCPL Financing, Series I............................... 20,000 505,000
------------
1,217,500
------------
TOTAL PREFERRED STOCKS -- (Cost $7,375,000)................. 7,128,105
------------
SHORT TERM INVESTMENTS -- (9.2%):
REPURCHASE AGREEMENT -- (5.1%):
Fifth Third Bank
5.45%, maturing 9/1/1999 (Collateralized by
$6,520,000 Fannie Mae, 7.00%, 11/01/2017, Market
Value -- $6,426,275 and by $1,200,000, Fannie
Mae, 6.75%, 7/1/2024, Market Value --
$1,176,318...................................... $7,476,534 7,476,534
------------
UNITED STATES TREASURY NOTES -- (4.1%):
5.125%, 8/31/2000...................................... 2,000,000 1,992,180
5.50%, 3/31/2000....................................... 2,000,000 2,001,880
5.375%, 6/30/2000...................................... 2,000,000 1,998,440
------------
5,992,500
------------
TOTAL SHORT TERM INVESTMENTS -- (Cost $13,481,295).......... 13,469,034
------------
TOTAL INVESTMENTS -- (Cost $91,926,727) (a) -- 101.5%....... 148,127,423
LIABILITIES IN EXCESS OF OTHER ASSETS -- (1.5)%............. (2,208,224)
------------
TOTAL NET ASSETS -- 100%.................................... $145,919,199
============
</TABLE>
- ---------------
Percentages indicated are based on net assets of $145,919,199.
(a) Cost for federal income tax and financial reporting is substantially the
same.
* Represents non-income producing securities.
See notes to financial statements.
10
<PAGE> 11
MAGNA INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
CORPORATE BONDS -- (32.3%):
FINANCE & BANKING -- (13.9%):
Bear Stearns Companies, Incorporated,
7.00%, 3/1/2007...................................... $1,000,000 $ 965,100
Ford Capital BV,
9.38%, 5/15/2001..................................... 380,000 395,462
Merrill Lynch & Company, Incorporated,
8.00%, 2/1/2002...................................... 325,000 334,084
8.30%, 11/1/2002..................................... 460,000 478,570
8.00%, 6/1/2007...................................... 500,000 518,960
Morgan Stanley Dean Witter,
8.10%, 6/24/2002..................................... 460,000 473,800
National City Bank of Kentucky,
6.30%, 2/15/2011, OID................................ 1,000,000 906,180
Nationsbank Corporation,
6.38%, 2/15/2008..................................... 1,000,000 943,160
6.60%, 5/15/2010..................................... 1,000,000 935,350
7.04%, 8/15/2012..................................... 500,000 468,520
Northern Trust Corporation,
7.10%, 8/1/2009...................................... 1,500,000 1,480,500
Norwest Financial, Incorporated,
7.20%, 5/1/2007...................................... 1,000,000 994,950
St. Paul Companies, Incorporated,
7.29%, 8/28/2007..................................... 500,000 509,090
Swiss Bank of New York,
7.00% 10/15/2015..................................... 1,000,000 932,442
Wachovia Corporation,
6.38%, 2/1/2009...................................... 1,000,000 940,010
-----------
11,276,178
-----------
FINANCIAL SERVICES -- (2.3%):
General Motors Acceptance Corporation,
6.13%, 11/15/2008.................................... 1,000,000 921,907
Morgan Stanley Dean Witter,
6.75%, 10/15/2013.................................... 1,000,000 936,510
-----------
1,858,417
-----------
</TABLE>
continued
11
<PAGE> 12
MAGNA INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
CORPORATE BONDS -- (CONTINUED):
INDUSTRIALS -- (7.5%):
Dupont Corporation,
8.13%, 3/15/2004..................................... $ 265,000 $ 281,488
Ford Motor Company,
9.00%, 9/15/2001..................................... 280,000 292,121
9.50%, 9/15/2011..................................... 230,000 266,002
J.C. Penney Company, Series A,
6.88%, 10/15/2015.................................... 1,500,000 1,319,809
Kimberly-Clark Corporation,
8.63%, 5/1/2001...................................... 280,000 289,792
Lilly (Eli) & Company,
8.13%, 12/1/2001..................................... 500,000 519,240
Loews Corporation,
6.75%, 12/15/2006.................................... 500,000 463,045
Monsanto Company,
8.75%, 5/15/2001..................................... 200,000 207,262
Philip Morris Companies, Incorporated,
8.75%, 6/1/2001...................................... 250,000 257,848
7.50%, 1/15/2002..................................... 360,000 364,241
7.25%, 1/15/2003..................................... 700,000 702,576
R.R. Donnelley & Sons Company,
7.00%, 1/1/2003...................................... 700,000 704,669
Rockwell International Corporation,
8.38%, 2/15/2001..................................... 280,000 288,137
Weyerhaeuser Company,
8.94%, 4/9/2001...................................... 100,000 104,053
-----------
6,060,283
-----------
INSURANCE -- (0.6%):
Citigroup Incorporated,
6.20%, 3/15/2009..................................... 500,000 462,200
-----------
TRANSPORTATION -- (0.3%):
Norfolk & Southern Railway Company,
7.75%, 8/15/2005..................................... 225,000 228,035
-----------
</TABLE>
continued
12
<PAGE> 13
MAGNA INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
CORPORATE BONDS -- (CONTINUED):
UTILITIES -- (7.7):
Alabama Power,
5.38%, 10/1/2008..................................... $1,000,000 $ 882,773
AT&T Corporation,
7.13%, 1/15/2002..................................... 960,000 971,904
Carolina Telephone & Telegraph Company,
7.25%, 12/15/2004.................................... 1,000,000 1,011,130
General Electric Company,
7.73%, 2/13/2002..................................... 400,000 410,908
National Rural Utilities,
7.30%, 9/15/2006..................................... 1,000,000 1,013,210
7.20%, 10/1/2015..................................... 450,000 429,795
Northern Telecom, Limited,
8.75%, 6/12/2001..................................... 430,000 445,575
Pacific Bell,
7.25%, 7/1/2002...................................... 1,000,000 1,013,760
-----------
6,179,055
-----------
TOTAL CORPORATE BONDS -- (Cost $26,862,578)................. 26,064,168
-----------
GOVERNMENT AND AGENCY BONDS -- (63.6%):
FEDERAL AGENCIES -- (59.3%):
FANNIE MAE -- (23.4%):
7.85%, 9/10/2004..................................... 500,000 499,610
8.33%, 2/8/2005...................................... 1,000,000 1,006,410
7.65%, 3/10/2005..................................... 500,000 519,920
6.83%, 10/10/2007.................................... 500,000 481,955
6.58%, 12/17/2007.................................... 1,000,000 960,160
6.27%, 2/13/2008..................................... 1,000,000 944,530
6.14%, 9/2/2008...................................... 1,000,000 933,750
6.00%, 12/18/2008.................................... 1,000,000 918,120
6.03%, 2/2/2009...................................... 1,000,000 921,410
7.00%, 12/5/2011..................................... 1,000,000 1,009,510
7.00%, 8/14/2012..................................... 1,500,000 1,421,715
7.00%, 8/27/2012..................................... 1,500,000 1,436,490
7.00%, 10/29/2012.................................... 500,000 473,360
6.26%, 11/26/2012.................................... 1,000,000 941,884
6.25%, 2/18/2014..................................... 2,000,000 1,797,500
6.37%, 2/25/2014..................................... 2,000,000 1,813,120
</TABLE>
continued
13
<PAGE> 14
MAGNA INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
GOVERNMENT AND AGENCY BONDS -- (CONTINUED):
FEDERAL AGENCIES -- (CONTINUED):
FANNIE MAE -- (CONTINUED):
7.00%, 12/12/2016........................................... $1,000,000 $ 937,751
6.75%, 8/25/2021..................................... 920,000 905,050
7.05%, 4/25/2022..................................... 925,000 905,048
-----------
18,827,293
-----------
FEDERAL FARM CREDIT BANK -- (5.8%):
6.20%, 11/30/2009.................................... 1,000,000 940,160
6.01%, 6/16/2010..................................... 2,000,000 1,840,620
6.13%, 1/22/2013..................................... 1,000,000 911,720
6.27%, 1/26/2016..................................... 1,000,000 918,280
-----------
4,610,780
-----------
FEDERAL HOME LOAN BANK -- (16.3%):
7.59%, 2/10/2000..................................... 1,000,000 1,007,030
5.26%, 10/26/2004.................................... 500,000 468,280
8.06%, 3/10/2005..................................... 500,000 501,955
7.33%, 5/30/2007..................................... 1,000,000 996,560
6.03%, 4/8/2008...................................... 1,000,000 938,120
6.12%, 8/26/2008..................................... 500,000 466,640
5.66%, 12/18/2008.................................... 500,000 452,345
7.01%, 12/4/2012..................................... 1,000,000 940,470
6.13%, 1/9/2013...................................... 2,000,000 1,838,740
6.73%, 9/17/2013..................................... 1,000,000 924,060
5.83%, 9/30/2013..................................... 1,000,000 886,250
6.10%, 2/19/2014..................................... 1,000,000 884,840
6.045%, 5/12/2014.................................... 1,000,000 907,030
6.625%, 6/30/2014.................................... 1,000,000 958,910
8.00%, 8/19/2014..................................... 1,000,000 992,340
-----------
13,163,570
-----------
FREDDIE MAC -- (11.4%):
7.90%, 9/19/2001..................................... 280,000 288,837
7.50%, 1/1/2007...................................... 13,330 13,340
6.50%, 5/1/2008...................................... 61,302 60,081
6.14%, 2/15/2011..................................... 1,000,000 927,340
6.77%, 3/21/2011..................................... 1,000,000 1,005,000
6.125%, 7/28/2011.................................... 1,000,000 902,340
</TABLE>
continued
14
<PAGE> 15
MAGNA INTERMEDIATE GOVERNMENT BOND FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- ---------- -----------
<S> <C> <C>
GOVERNMENT AND AGENCY BONDS -- (CONTINUED):
FEDERAL AGENCIES -- (CONTINUED):
FREDDIE MAC -- (CONTINUED):
6.71%, 12/5/2011............................................ $2,000,000 $ 1,912,819
7.27%, 2/6/2012...................................... 1,000,000 995,160
7.49%, 4/16/2012..................................... 1,000,000 1,010,310
7.09%, 11/22/2016.................................... 500,000 478,045
7.00%, 1/15/2023..................................... 1,000,000 976,250
7.00%, 12/15/2023.................................... 546,000 531,837
6.50%, 2/15/2024..................................... 66,871 66,766
-----------
9,168,125
-----------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION -- (2.4%):
7.50%, 6/20/2029..................................... 1,982,626 1,961,233
-----------
47,731,001
-----------
U.S. GOVERNMENT SECURITIES -- (4.3%):
TENNESSEE VALLEY AUTHORITY -- (3.4%)
6.00%, 3/15/2013..................................... 3,000,000 2,783,430
-----------
UNITED STATES TREASURY NOTES -- (0.9%)
6.00%, 10/15/1999.................................... 690,000 691,033
-----------
3,474,463
-----------
TOTAL GOVERNMENT AND AGENCY BONDS -- (Cost $53,771,578)..... 51,205,464
-----------
SHORT TERM INVESTMENTS -- (3.3%):
REPURCHASE AGREEMENT:
Fifth Third Bank
5.45%, maturing 9/1/1999 (Collateralized by
$2,716,000 Fannie Mae,
6.75%, 7/1/2024, Market Value -- $2,662,400)...... 2,662,006 2,662,006
-----------
TOTAL SHORT TERM INVESTMENTS -- (Cost $2,662,006)........... 2,662,006
-----------
TOTAL INVESTMENTS -- (Cost $83,296,162)(a) -- 99.2%......... 79,931,638
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.8%............... 674,874
-----------
TOTAL NET ASSETS -- 100%.................................... $80,606,512
===========
</TABLE>
- ---------------
(a) Cost for federal income tax and financial reporting is substantially the
same.
Percentages indicated are based on net assets of $80,606,512.
OID -- Original Issue Discount.
See notes to financial statements.
15
<PAGE> 16
MAGNA MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- --------- ------
<S> <C> <C>
CERTIFICATE OF DEPOSIT -- (3.0%):
YANKEE & EURODOLLAR -- (3.0%):
Deutsche Bank, 5.62%, 6/26/2000........................ $ 5,000,000 $ 4,998,104
------------
TOTAL CERTIFICATE OF DEPOSIT -- (Cost $4,998,104)........... 4,998,104
------------
COMMERCIAL PAPER -- (21.3%):
AEROSPACE -- (3.0%):
General Dynamics, 0.00%, 9/8/1999...................... 5,000,000 4,994,925
------------
FOOD PRODUCTS & SERVICES -- (2.1%):
Sysco, 0.00%, 9/1/1999................................. 3,500,000 3,500,000
------------
GAS & ELECTRIC UTILITY -- (3.0%):
Mid American Energy, 0.00%, 9/1/1999................... 5,000,000 5,000,000
------------
PETROLEUM REFINING -- (7.2%):
Amoco, 5.20%, 10/7/1999................................ 5,000,000 5,000,000
Shell, 5.60%, 9/1/1999................................. 3,900,000 3,900,000
Shell, 5.38%, 9/20/1999................................ 3,100,000 3,100,000
------------
12,000,000
------------
PRINTING & PUBLISHING -- (3.0%):
Gannett, 0.00%, 9/8/1999............................... 5,000,000 4,994,896
------------
TELECOMMUNICATIONS -- (3.0%):
Bell South, 0.00%, 9/1/1999............................ 5,000,000 5,000,000
------------
TOTAL COMMERCIAL PAPER -- (Cost $35,489,821)................ 35,489,821
------------
CORPORATE BONDS -- (6.3%):
FINANCE & BANKING -- (3.3%):
Bayerische Landesbank, 6.125%, 3/30/2000............... 5,380,000 5,392,984
------------
FINANCIAL SERVICES -- (3.0%):
General Motors Acceptance Corporation, 5.85%,
4/6/2000............................................. 5,000,000 5,004,712
------------
TOTAL CORPORATE BONDS -- (Cost $10,397,696)................. 10,397,696
------------
GOVERNMENT AND AGENCY BONDS -- (56.3%):
FANNIE MAE -- (25.9%):
0.00%, 9/1/1999........................................ 30,000,000 30,000,000
5.44%, 1/14/2000....................................... 4,000,000 4,003,394
5.65%, 6/12/2000....................................... 9,055,000 9,054,377
------------
43,057,771
------------
</TABLE>
continued
16
<PAGE> 17
MAGNA MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- --------- ------
<S> <C> <C>
GOVERNMENT AND AGENCY BONDS -- (CONTINUED):
FEDERAL FARM CREDIT BANK -- (9.7%):
4.875%, 9/1/1999....................................... $ 1,000,000 $ 1,000,000
5.06%, 10/1/1999....................................... 5,000,000 5,001,103
0.00%, 11/24/1999...................................... 1,000,000 987,864
4.85%, 12/1/1999....................................... 3,100,000 3,099,088
5.20%, 1/14/2000....................................... 1,000,000 1,000,000
5.30%, 2/1/2000........................................ 5,000,000 5,000,000
------------
16,088,055
------------
FEDERAL HOME LOAN BANK -- (20.7%):
6.035%, 9/27/1999...................................... 1,500,000 1,500,451
5.805%, 11/4/1999...................................... 4,000,000 4,001,876
5.91%, 11/5/1999....................................... 2,200,000 2,201,148
*5.37%, 11/10/1999...................................... 15,000,000 14,997,893
0.00%, 11/12/1999...................................... 1,000,000 989,595
0.00%, 11/17/1999...................................... 1,000,000 988,874
0.00%, 11/19/1999...................................... 1,000,000 988,585
0.00%, 11/22/1999...................................... 1,000,000 988,154
4.93%, 1/19/2000....................................... 3,185,000 3,181,774
5.625%, 6/02/2000...................................... 2,035,000 2,035,000
5.62%, 8/10/2000....................................... 2,550,000 2,550,000
------------
34,423,350
------------
TOTAL GOVERNMENT AND AGENCY BONDS -- (Cost $93,569,176)..... 93,569,176
------------
U.S. TREASURY OBLIGATIONS -- (6.0%):
U.S. TREASURY OBLIGATIONS -- (CONTINUED):
U.S. TREASURY NOTES -- (6.0%):
7.125%, 9/30/1999...................................... 10,000,000 10,018,845
------------
TOTAL U.S. TREASURY OBLIGATIONS -- (Cost $10,018,845)....... 10,018,845
------------
WEEKLY DEMAND NOTE -- (3.1%):
WASHINGTON -- (3.1%):
*Everett Clinic, 5.20%, 12/1/2018...................... 5,200,000 5,200,000
------------
TOTAL WEEKLY DEMAND NOTE -- (Cost $5,200,000)............... 5,200,000
------------
</TABLE>
continued
17
<PAGE> 18
MAGNA MONEY MARKET FUND
SCHEDULE OF PORTFOLIO INVESTMENTS
AUGUST 31, 1999
<TABLE>
<CAPTION>
PRINCIPAL MARKET
SECURITY DESCRIPTION AMOUNT VALUE
-------------------- --------- ------
<S> <C> <C>
SHORT TERM INVESTMENTS -- (3.7%):
REPURCHASE AGREEMENT:
FIFTH THIRD BANK
5.45%, maturing 9/1/1999 (Collateralized by
$6,216,000 Fannie Mae, 6.75%, 7/1/2024, Market
Value -- $6,093,327).............................. $ 6,093,659 $ 6,093,659
------------
TOTAL SHORT TERM INVESTMENTS -- (Cost $6,093,659)........... 6,093,659
------------
TOTAL INVESTMENTS -- (Cost $165,767,301)(a) -- 99.7%........ 165,767,301
OTHER ASSETS IN EXCESS OF LIABILITIES -- 0.3%............... 567,694
------------
TOTAL NET ASSETS -- 100.0%.................................. $166,334,995
============
</TABLE>
- ---------------
Percentages indicated are based on net assets of $166,334,995.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
* Variable Rate Investments. The rate presented is the rate in effect at August
31, 1999.
See notes to financial statements.
18
<PAGE> 19
MAGNA FUNDS
STATEMENTS OF ASSETS AND LIABILITIES
AUGUST 31, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GROWTH & INTERMEDIATE MONEY
INCOME GOVERNMENT MARKET
FUND BOND FUND FUND
------------ ------------ ------------
<S> <C> <C> <C>
ASSETS:
Investments in securities, at value (cost
$84,450,193, $80,634,156 and $159,673,642,
respectively)................................ $140,650,889 $77,269,632 $159,673,642
Repurchase agreements, (cost $7,476,534,
$2,662,006 and $6,093,659, respectively)..... 7,476,534 2,662,006 6,093,659
------------ ----------- ------------
TOTAL INVESTMENTS............................ 148,127,423 79,931,638 165,767,301
------------ ----------- ------------
Dividends and interest receivable.............. 293,133 1,146,337 1,214,415
Receivable for investment securities sold...... 2,176,496 -- --
Prepaid expenses and other assets.............. 8,433 4,510 9,863
------------ ----------- ------------
TOTAL ASSETS................................. 150,605,485 81,082,485 166,991,579
------------ ----------- ------------
LIABILITIES:
Distributions payable.......................... -- 411,732 607,058
Payable for investment securities purchased.... 4,565,013 -- --
Accrued expenses:
Advisory fees................................ 61,213 27,417 22,908
Administration fees.......................... 4,858 2,674 4,636
Other........................................ 55,202 34,150 21,982
------------ ----------- ------------
TOTAL LIABILITIES............................ 4,686,286 475,973 656,584
------------ ----------- ------------
NET ASSETS..................................... $145,919,199 $80,606,512 $166,334,995
============ =========== ============
COMPOSITION OF NET ASSETS:
Paid-in capital................................ $ 88,793,868 $84,068,502 $166,336,557
Accumulated undistributed (distributions in
excess of) net investment income............. 314,363 (1,371) --
Accumulated net realized gains (losses) on
investment transactions...................... 610,272 (96,095) (1,562)
Net unrealized appreciation (depreciation) from
investments.................................. 56,200,696 (3,364,524) --
------------ ----------- ------------
NET ASSETS..................................... $145,919,199 $80,606,512 $166,334,995
============ =========== ============
Shares of beneficial interest outstanding, no
par value.................................... 4,804,812 6,693,676 166,336,557
============ =========== ============
Net asset value and redemption price per
share........................................ $ 30.37 $ 12.04 $ 1.00
============ =========== ============
Maximum Sales Charge........................... 4.00% 4.00% --
============ =========== ============
Maximum Offering Price (100%/(100%-Maximum
Sales Charge) of net asset value adjusted to
the nearest cent) per share.................. $ 31.64 $ 12.54 $ --
============ =========== ============
</TABLE>
See notes to financial statements.
19
<PAGE> 20
MAGNA FUNDS
STATEMENTS OF OPERATIONS
FOR THE PERIOD ENDED AUGUST 31, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
GROWTH & INTERMEDIATE MONEY
INCOME GOVERNMENT MARKET
FUND BOND FUND FUND(A)
------------ ------------ ------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest income................................ $ 532,423 $ 5,046,622 $ 1,168,420
Dividend income................................ 1,952,615 -- --
------------ ----------- ------------
TOTAL INCOME................................. 2,485,038 5,046,622 1,168,420
------------ ----------- ------------
EXPENSES:
Advisory fees (Note 3)......................... 967,691 387,178 96,163
Administration fees (Note 3)................... 257,852 154,873 48,079
12b-1 fees (Note 3)............................ 322,564 193,589 60,102
Fund accounting fees (Note 3).................. 44,484 53,955 5,208
Offering fees.................................. -- -- 10,808
Amortization of organization costs............. 12,392 20,733 --
Transfer agent fees (Note 3)................... 44,033 25,692 4,872
Trustees' fees and expenses.................... 20,819 12,624 1,630
Other.......................................... 103,765 61,205 17,325
------------ ----------- ------------
TOTAL EXPENSES............................... 1,773,600 909,849 244,187
Less: Expenses voluntarily reduced/waived.... (645,127) (271,024) (122,607)
------------ ----------- ------------
Net expenses................................. 1,128,473 638,825 121,580
------------ ----------- ------------
NET INVESTMENT INCOME.......................... 1,356,565 4,407,797 1,046,840
------------ ----------- ------------
REALIZED AND UNREALIZED GAINS (LOSSES) ON
INVESTMENT TRANSACTIONS:
Realized gains (losses) on investment
transactions................................. 610,272 62,312 (1,562)
Net change in unrealized appreciation
(depreciation) from investments.............. 30,829,853 (6,124,561) --
------------ ----------- ------------
Net realized and unrealized gains (losses) on
investment transactions...................... 31,440,125 (6,062,249) (1,562)
------------ ----------- ------------
CHANGE IN NET ASSETS RESULTING FROM
OPERATIONS................................... $ 32,796,690 $(1,654,452) $ 1,045,278
============ =========== ============
</TABLE>
- ---------------
(a) For the period July 7, 1999 to August 31, 1999.
See notes to financial statements.
20
<PAGE> 21
MAGNA FUNDS
GROWTH & INCOME FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
AUGUST 31, 1999 AUGUST 31, 1998
--------------- ---------------
<S> <C> <C>
CHANGE IN NET ASSETS:
FROM OPERATIONS:
Net investment income.................................... $ 1,356,565 $ 760,796
Net realized gains (losses) on investment transactions... 610,272 3,524,168
Net change in unrealized appreciation (depreciation) from
investments............................................ 30,829,853 2,381,549
------------ ------------
Change in net assets resulting from operations........... 32,796,690 6,666,513
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income.................................... (1,179,259) (812,222)
Net realized gains....................................... (2,809,929) (1,369,723)
------------ ------------
Change in net assets from shareholder distributions...... (3,989,188) (2,181,945)
------------ ------------
FROM FUND SHARE TRANSACTIONS:
Proceeds from sale of shares............................. 55,582,611 10,354,580
Shares issued in reinvestment of distributions........... 2,300,629 1,697,386
Payments for shares redeemed............................. (14,902,534) (12,682,030)
------------ ------------
Change in net assets from fund share transactions........ 42,980,706 (630,064)
------------ ------------
NET INCREASE IN NET ASSETS............................... 71,788,208 3,854,504
------------ ------------
NET ASSETS:
Beginning of period...................................... 74,130,991 70,276,487
------------ ------------
End of period............................................ $145,919,199 $ 74,130,991
============ ============
Accumulated undistributed (distributions in excess of)
net investment income.................................. $ 314,363 $ 137,057
------------ ------------
SHARE TRANSACTIONS:
Issued................................................... 2,082,954 422,534
Reinvested............................................... 82,321 72,896
Redeemed................................................. (520,372) (503,629)
------------ ------------
Change in shares......................................... 1,644,903 (8,199)
============ ============
</TABLE>
See notes to financial statements.
21
<PAGE> 22
MAGNA FUNDS
INTERMEDIATE GOVERNMENT BOND FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
AUGUST 31, 1999 AUGUST 31, 1998
--------------- ---------------
<S> <C> <C>
INCREASE IN NET ASSETS:
FROM OPERATIONS:
Net investment income..................................... $ 4,407,797 $ 4,001,009
Net realized gains (losses) on investment transactions.... 62,312 98,469
Net change in unrealized appreciation (depreciation) from
investments............................................. (6,124,561) 1,969,499
----------- -----------
Change in net assets resulting from operations............ (1,654,452) 6,068,977
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income..................................... (4,406,645) (4,001,009)
In excess of net investment income........................ (1,152) --
----------- -----------
Change in net assets from shareholder distributions....... (4,407,797) (4,001,009)
----------- -----------
FROM FUND SHARE TRANSACTIONS:
Proceeds from sale of shares.............................. 22,721,191 15,220,676
Shares issued in reinvestment of distributions............ 641,435 674,015
Payments for shares redeemed.............................. (9,308,084) (9,807,364)
----------- -----------
Change in net assets from fund share transactions......... 14,054,542 6,087,327
----------- -----------
NET INCREASE IN NET ASSETS................................ 7,992,293 8,155,295
----------- -----------
NET ASSETS:
Beginning of period....................................... 72,614,219 64,458,924
----------- -----------
End of period............................................. $80,606,512 $72,614,219
=========== ===========
Accumulated undistributed (distributions in excess of) net
investment income....................................... $ (1,371) $ (1,152)
----------- -----------
SHARE TRANSACTIONS:
Issued.................................................... 1,790,846 1,188,041
Reinvested................................................ 50,162 52,724
Redeemed.................................................. (734,208) (765,780)
----------- -----------
Change in shares.......................................... 1,106,800 474,985
=========== ===========
</TABLE>
See notes to financial statements.
22
<PAGE> 23
MAGNA FUNDS
MONEY MARKET FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JULY 7, 1999 TO
AUGUST 31, 1999(a)
------------------
<S> <C>
INCREASE IN NET ASSETS:
FROM OPERATIONS:
Net investment income....................................... $ 1,046,840
Net realized gains (losses) on investment transactions...... (1,562)
------------
Change in net assets resulting from operations.............. 1,045,278
------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income....................................... (1,046,840)
------------
Change in net assets from shareholder distributions......... (1,046,840)
------------
FROM FUND SHARE TRANSACTIONS:
Proceeds from sale of shares................................ 190,304,944
Shares issued in reinvestment of distributions.............. 52
Payments for shares redeemed................................ (23,968,439)
------------
Change in net assets from fund share transactions........... 166,336,557
------------
NET INCREASE IN NET ASSETS.................................. 166,334,995
------------
NET ASSETS:
Beginning of period......................................... --
------------
End of period............................................... $166,334,995
============
SHARE TRANSACTIONS:
Issued...................................................... 190,304,944
Reinvested.................................................. 52
Redeemed.................................................... (23,968,439)
------------
Change in shares............................................ 166,336,557
============
</TABLE>
- ---------------
(a) Period from commencement of operations.
See notes to financial statements.
23
<PAGE> 24
MAGNA FUNDS
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND FUND DESCRIPTION
Magna Funds (the "Trust") is an open-end, diversified management investment
company registered under the Investment Company Act of 1940 (the "Act"), as
amended. The Trust was organized as a Massachusetts business trust on April 28,
1994, and is authorized to issue an unlimited number of shares of beneficial
interest in multiple series. Two series commenced investment operations on
September 1, 1994, the Magna Growth & Income Fund and the Magna Intermediate
Government Bond Fund (the "Funds"). One series commenced investment operations
on July 7, 1999, the Magna Money Market Fund.
The investment objective of the Magna Growth & Income Fund is to seek long-term
growth of capital, current income and growth of income. The investment objective
of the Magna Intermediate Government Bond Fund and the Magna Money Market Fund
is to achieve current income consistent with preservation of capital.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Trust.
Investment Valuation: Equity securities listed on an established securities
exchange or on the NASDAQ National Market System are valued at the closing sale
price on the exchange where primarily traded or, if there is no reported sale
during the day, and in the case of over-the-counter securities not so listed, at
the last bid price. Long-term debt securities are valued by a pricing service,
which determines valuations of normal institutional-size trading units of
long-term debt securities. Short-term debt securities having a maturity of 60
days or less from the valuation date are valued at amortized cost which
approximates market value.
Investment Transactions: All securities transactions are recorded on a trade
date basis. Dividend income is recorded on the ex-dividend date and interest
income is recorded on the accrual basis. Realized gains and losses on sales of
securities are determined on the basis of identified cost.
Repurchase Agreements: A repurchase agreement customarily obligates the seller
at the time it sells securities to the Funds to repurchase the securities at a
mutually agreed upon time and price which, in the case of the Funds'
transactions, is usually within seven days. The total amount received by the
Funds on repurchase agreements is calculated to exceed the price paid by the
Funds, reflecting an agreed upon market rate of interest for the period of time
to the settlement date, and will not necessarily be related to the interest rate
on the underlying securities. The underlying securities are ordinarily United
States government securities. Repurchase agreements will be fully collateralized
at all times. However, to the extent that the proceeds from any sale upon
default in the obligation to repurchase is less than the repurchase price, the
Funds would suffer a loss. Also, the Funds might incur costs and encounter
delays in liquidating collateral.
Deferred Organizational Expenses: The Funds bear all costs in connection with
their organization, including the fees and expenses of registering and
qualifying shares for distribution under Federal and State securities
regulations. All such costs are amortized using the straight-line method over a
period of five years from the dates each Fund commenced operations: September 1,
1994, for the Magna Growth & Income Fund and the Magna Intermediate Government
Bond Fund.
continued
24
<PAGE> 25
MAGNA FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
Offering Expenses: All expenses in connection with the Magna Money Market Fund's
organization and registration under the 1940 Act and the Securities Act of 1933
were paid by the Fund. Such expenses are being amortized on a straight-line
basis over twelve months beginning with the date of the initial public offering.
The Fund paid $10,808 in offering costs.
Dividends and Distributions to Shareholders: The Magna Intermediate Government
Bond Fund and the Magna Money Market Fund declare dividends from net investment
income daily and make payments monthly. The Magna Growth & Income Fund declares
and pays dividends from net investment income quarterly. Each Fund also
distributes all of its net capital gains, if any, on an annual basis, normally
in December. Distributions are recorded on the ex-dividend date. Income
distributions and capital gain distributions are determined in accordance with
income tax regulations, which may differ from generally accepted accounting
principles. The differences are primarily due to differing treatments for
mortgage-backed securities, expiring capital loss carryforwards, and deferrals
of certain losses. Permanent book and tax basis differences have been
reclassified among the components of net assets.
Federal Income Taxes: Each Fund of the Trust is treated as a separate entity for
federal tax purposes. Each Fund intends to qualify each year as a regulated
investment company under Subchapter M of the Internal Revenue Code. By so
qualifying, the Funds will not be subject to federal income tax to the extent
that they distribute all of their taxable income, including realized capital
gains, for the fiscal year. In addition, by distributing substantially all of
their net investment income and capital gains during the calendar year, the
Funds will not be subject to a federal excise tax.
Expenses: Expenses that are directly related to one of the Funds are charged
directly to that Fund. Expenses relating to the Funds collectively are prorated
to the Funds on the basis of each Fund's relative net assets.
Estimates: The financial statements have been prepared in conformity with
generally accepted accounting principles which permit management to make certain
estimates and assumptions at the date of the financial statements. Actual
results could differ from those estimates.
3. RELATED PARTY TRANSACTIONS
Each Fund has entered into a separate Investment Advisory Agreement with Union
Planters Bank, N.A. ("UPC"). Under these agreements, each Fund pays a fee,
calculated daily and paid monthly, based on the respective average daily net
assets of such Fund. This fee is 0.75% for the Magna Growth & Income Fund, 0.50%
for the Magna Intermediate Government Bond Fund, and 0.40% for the Magna Money
Market Fund. UPC has voluntarily agreed to reduce its fees with respect to the
Magna Growth & Income Fund to 0.50% and with respect to the Magna Intermediate
Government Bond Fund to 0.40% of daily net assets through August 31, 1999. Also,
the UPC has voluntarily agreed to reduce its fee for the Magna Money Market Fund
to 0.17% of daily net assets through August 31, 2000. This voluntary reduction
has been in effect since September 1, 1995 for the Growth & Income Fund and the
Intermediate Government Bond Fund; the Magna Money Market Fund has been in
effect since July 7, 1999. For the period ended August 31, 1999, UPC voluntarily
waived investment advisory fees of $322,563, $77,435, and $55,293 for the Magna
Growth & Income Fund, Magna Intermediate Government Bond Fund, and the Magna
Money Market Fund, respectively.
continued
25
<PAGE> 26
MAGNA FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
BISYS Fund Services Limited Partnership d/b/a BISYS Fund Services ("BISYS"), an
Ohio limited partnership, is a subsidiary of The BISYS Group, Inc. BISYS, with
whom certain officers of the Trust are affiliated, serves the Trust as
distributor, administrator, transfer agent and fund accountant. Such officers
are not paid any fees directly by the Funds for serving as officers of the
Trust.
The Trust has entered into an Administration Service Agreement with BISYS, who
provides management and administrative services to the Funds pursuant to this
agreement. The Trust pays BISYS a fee for its services to each Fund under the
Administration Service Agreement at the annual rate of 0.20% of the Trust's
average net assets. For the period ended August 31, 1999, BISYS earned $257,852
from the Magna Growth & Income Fund, $154,873 from the Magna Intermediate
Government Bond Fund, and $48,079 from the Magna Money Market Fund. For the
period ended August 31, 1999, BISYS voluntarily waived 0.03% for the Magna Money
Market Fund, amounting to $7,212 of the service fees.
Each Fund has adopted a Service Plan (the "Plan") pursuant to Rule 12b-1 under
the Investment Company Act of 1940, as amended. The purpose of each plan is to
compensate the Funds' Distributor for expenses borne in connection with the
provision of personal services provided to investors and/or maintenance of
shareholder accounts, at an annual rate not to exceed 0.25% of each Fund's
average daily net assets. For the period ended August 31, 1999, BISYS (the
"Distributor") voluntarily waived the entire 0.25% for each Fund, amounting to
$322,564, $193,589, and $60,102 of service fees for the Magna Growth & Income
Fund, the Magna Intermediate Government Bond Fund, and the Magna Money Market
Fund, respectively.
BISYS is entitled to receive commissions on sales of shares of the Funds for the
year ended August 31, 1999. BISYS received $3,407 of commissions on sales of
shares of the Funds, of which $2,405 was allowed to affiliated broker/dealers of
the Funds.
BISYS also serves the Funds as Transfer Agent. For the period ended August 31,
1999, BISYS received Transfer Agent fees of $44,033, $25,692, and $4,872 from
the Magna Growth & Income Fund, the Magna Intermediate Government Bond Fund, and
the Magna Money Market, respectively.
As Fund Accountant for the period ended August 31, 1999, BISYS received Fund
Accounting fees of $44,484, $53,955, and $5,208 from the Magna Growth & Income
Fund, the Magna Intermediate Government Bond Fund, and the Magna Money Market
Fund, respectively.
Each of the Trust's Trustees who are not affiliated with UPC receives an annual
fee of $5,000 plus $500 for each meeting attended. Total fees paid to Trustees
for the year ended August 31, 1999 were $35,073.
4. INVESTMENT TRANSACTIONS
Purchases and proceeds from sales and maturities of investments, excluding
short-term securities for each Fund for the period ended August 31, 1999 were as
follows:
<TABLE>
<CAPTION>
PURCHASES SALES
----------- -----------
<S> <C> <C>
Magna Growth & Income Fund.................................. $47,263,846 $10,284,410
Magna Intermediate Government Bond Fund..................... $26,390,889 $11,688,528
</TABLE>
continued
26
<PAGE> 27
MAGNA FUNDS
NOTES TO FINANCIAL STATEMENTS, CONTINUED
The identified cost for federal income tax purposes of investments owned by each
Fund and their respective gross unrealized appreciation and depreciation at
August 31, 1999 were as follows:
<TABLE>
<CAPTION>
GROSS GROSS NET UNREALIZED
IDENTIFIED UNREALIZED UNREALIZED APPRECIATION
COST APPRECIATION (DEPRECIATION) (DEPRECIATION)
------------ ------------ -------------- --------------
<S> <C> <C> <C> <C>
Growth & Income Fund.......... $ 91,926,727 $57,929,834 $(1,729,138) $56,200,696
Intermediate Government Bond
Fund........................ $ 83,296,162 $ 405,568 $(3,770,092) $(3,364,524)
Magna Money Market Fund....... $165,767,301 $ -- $ -- $ --
</TABLE>
5. FEDERAL INCOME TAX INFORMATION (unaudited)
For the fiscal year ended August 31, 1999, 100% of the dividends distributed by
the Magna Growth & Income Fund qualified for the dividends-received deduction
for corporate shareholders.
The Magna Growth & Income Fund capital gain dividend distributions from
long-term capital gains for the fiscal year ended August 31, 1999 was
$2,809,929, of which, $2,809,929 was taxed at 20%.
As of August 31, 1999, the Magna Intermediate Government Bond Fund had a capital
loss carryover of $96,095 which will expire in 2004 to offset any future net
capital gains, if any, to the extent provided by the Treasury regulations. To
the extent that this carryover is used to offset future capital gains, it is
probable that the gains so offset will not be distributed to shareholders.
As of August 31, 1999, the Magna Money Market Fund has a post October 31, 1998
loss of $1,562. Capital losses incurred after October 31, 1998 within the fund's
fiscal year, may be deferred and treated as incurring the first day of the
following year. The Magna Money Market Fund has elected to defer this loss until
the fiscal year ended August 31, 2000.
continued
27
<PAGE> 28
MAGNA FUNDS
MAGNA GROWTH & INCOME FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SEPTEMBER 1,
YEAR YEAR YEAR YEAR 1994*
ENDED ENDED ENDED ENDED THROUGH
AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31, AUGUST 31,
1999 1998 1997 1996 1995
---------- ---------- ---------- ---------- ------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD...... $ 23.46 $ 22.18 $ 16.42 $ 14.05 $ 12.50
-------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....................... 0.30 0.23 0.26 0.24 0.25
Net realized and unrealized gains from
investment transactions................... 7.53 1.72 6.12 2.39 1.52
-------- ------- ------- ------- -------
Total income from investment operations..... 7.83 1.95 6.38 2.63 1.77
-------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Net investment income....................... (0.27) (0.25) (0.25) (0.23) (0.22)
Net realized gain from investment
transactions.............................. (0.65) (0.42) (0.37) (0.03) --
-------- ------- ------- ------- -------
Total dividends and distributions........... (0.92) (0.67) (0.62) (0.26) (0.22)
-------- ------- ------- ------- -------
NET ASSET VALUE -- END OF PERIOD............ $ 30.37 $ 23.46 $ 22.18 $ 16.42 $ 14.05
======== ======= ======= ======= =======
Total return (1)............................ 33.73% 8.84% 39.59% 18.77% 14.33%
RATIOS AND SUPPLEMENTAL DATA:
- -----------------------------
Net assets, at end of period ($000's)....... $145,919 $74,131 $70,276 $39,995 $30,284
Ratio of expenses to average net assets..... 0.87% 0.99% 1.06% 1.27% 1.25%
Ratio of net investment income to average
net assets................................ 1.05% 0.96% 1.36% 1.56% 1.98%
Ratio of expenses to average net assets
without fee waivers**..................... 1.37% 1.49% 1.56% 1.77% 1.88%
Ratio of net investment income to average
net assets without fee waivers**.......... 0.55% 0.46% 0.86% 1.06% 1.35%
Portfolio turnover rate..................... 9% 26% 17% 31% 41%
</TABLE>
- --------------------------------------------------------------------------------
* Commencement of operations.
** During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(1) Total return excludes sales charges. Had the advisor, distributor and
administrator not reduced or waived certain expenses total returns would
have been lower.
28
<PAGE> 29
MAGNA FUNDS
MAGNA INTERMEDIATE GOVERNMENT BOND FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SEPTEMBER 1,
YEAR YEAR YEAR YEAR 1994*
ENDED ENDED ENDED ENDED THROUGH
AUGUST 31, AUGUST 31, AUGUST 31, AUGUST AUGUST 31,
1999 1998 1997 31, 1996 1995
---------- ---------- ---------- --------- -------------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD...... $ 13.00 $ 12.61 $ 12.43 $ 12.75 $ 12.50
------- ------- ------- ------- -------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....................... 0.72 0.76 0.79 0.76 0.74
Net realized and unrealized gains (losses)
from investment transactions.............. (0.96) 0.39 0.19 (0.32) 0.25
------- ------- ------- ------- -------
Total income from investment operations..... (0.24) 1.15 0.98 0.44 0.99
------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
Net investment income....................... (0.72) (0.76) (0.79) (0.76) (0.74)
In excess of net investment income.......... -- -- (0.01) -- --
------- ------- ------- ------- -------
Total dividends and distributions........... (0.72) (0.76) (0.80) (0.76) (0.74)
------- ------- ------- ------- -------
NET ASSET VALUE -- END OF PERIOD............ $ 12.04 $ 13.00 $ 12.61 $ 12.43 $ 12.75
======= ======= ======= ======= =======
Total return (1)............................ (1.97)% 9.33% 7.96% 3.48% 8.30%
RATIOS AND SUPPLEMENTAL DATA:
- -----------------------------
Net assets, at end of period ($000's)....... $80,607 $72,614 $64,459 $56,764 $52,085
Ratio of expenses to average net assets..... 0.82% 0.90% 0.96% 1.05% 1.10%
Ratio of net investment income to average
net assets................................ 5.69% 5.92% 6.15% 5.97% 6.00%
Ratio of expenses to average net assets
without fee waivers**..................... 1.17% 1.25% 1.31% 1.40% 1.43%
Ratio of net investment income to average
net assets without fee waivers**.......... 5.34% 5.57% 5.80% 5.62% 5.66%
Portfolio turnover rate..................... 16% 32% 19% 20% 34%
</TABLE>
- --------------------------------------------------------------------------------
* Commencement of operations.
** During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(1) Total return excludes sales charges. Had the advisor, distributor and
administrator not reduced or waived certain expenses total returns would
have been lower.
29
<PAGE> 30
MAGNA FUNDS
MONEY MARKET FUND
FINANCIAL HIGHLIGHTS
Selected data for a share of beneficial interest outstanding throughout the
period indicated:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
JULY 7, 1999*
THROUGH
AUGUST 31, 1999
---------------
<S> <C>
NET ASSET VALUE -- BEGINNING OF PERIOD...................... $ 1.000
--------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income....................................... 0.007
Net realized and unrealized gains from investment
transactions.............................................. --
--------
Total income from investment operations..................... 0.007
--------
LESS DISTRIBUTIONS:
Net investment income....................................... (0.007)
--------
Total dividends and distributions........................... (0.007)
--------
NET ASSET VALUE -- END OF PERIOD............................ $ 1.000
========
Total return (1)............................................ 0.67%(b)
RATIOS AND SUPPLEMENTAL DATA:
- -----------------------------
Net assets, at end of period ($000's)....................... $166,335
Ratio of expenses to average net assets..................... 0.51%(a)
Ratio of net investment income to average net assets........ 4.35%(a)
Ratio of expenses to average net assets without fee
waivers**................................................. 1.02%(a)
Ratio of net investment income to average net assets without
fee waivers**............................................. 3.84%(a)
</TABLE>
- --------------------------------------------------------------------------------
* Commencement of operations.
** During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(1) Had the advisor, distributor and administrator not reduced or waived certain
expenses total returns would have been lower.
(a) Annualized
(b) Not annualized
30
<PAGE> 31
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Trustees
Magna Funds
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of portfolio investments, and the related statements of operations
and changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Magna Growth & Income Fund, Magna
Intermediate Government Bond Fund and Magna Money Market Fund (separate
portfolios constituting Magna Funds, hereafter referred to as the "Funds") at
August 31, 1999, the results of each of their operations for the period then
ended, the changes in each of their net assets for the periods presented, and
the financial highlights for each of the periods presented, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Funds' management, our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements 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
audits, which included confirmation of securities at August 31, 1999 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
PricewaterhouseCoopers LLP
Columbus, Ohio
September 15, 1999
31
<PAGE> 32
- ------------------------------------------------------
- ------------------------------------------------------
INVESTMENT ADVISOR
Magna Bank, N.A.
1401 South Brentwood Boulevard
St. Louis, Missouri 61344
ADMINISTRATOR & DISTRIBUTOR
BISYS Fund Services
3435 Stelzer Road
Columbus, OH 43219
TRANSFER AND
DIVIDEND PAYING AGENT
BISYS Fund Services
3435 Stelzer Road
Columbus, OH 43219
CUSTODIAN
Fifth Third Bank
Fifth Third Center
Cincinnati, OH 45263
LEGAL COUNSEL
Ropes & Gray
One International Place
Boston, Massachusetts 02110
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
100 East Broad Street
Columbus, OH 43215
10-99
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Letter to Shareholders.................... 1
Portfolio Manager Report.................. 2
Schedule of Portfolio Investments......... 6
Statements of Assets and Liabilities...... 19
Statements of Operations.................. 20
Statements of Changes in Net Assets....... 21
Notes to Financial Statements............. 24
Financial Highlights...................... 28
Report of Independent Accountants......... 31
</TABLE>
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
- ------------------------------------------------------
MAGNA FUNDS
A FAMILY OF FUNDS
ANNUAL REPORT
AUGUST 31, 1999
3435 STELZER ROAD
COLUMBUS, OH 43219
(800) 219-4182
- ------------------------------------------------------
- ------------------------------------------------------
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE PROVIDED FOR THE
GENERAL INFORMATION OF THE SHAREHOLDERS OF THE MAGNA FUNDS. THIS MATERIAL MUST
BE PRECEDED OR ACCOMPANIED BY A PROSPECTUS. READ THE PROSPECTUS CAREFULLY BEFORE
YOU INVEST OR SEND MONEY. INVESTMENTS IN MUTUAL FUNDS INVOLVE RISK, INCLUDING
THE POSSIBLE LOSS OF PRINCIPAL. MUTUAL FUNDS ARE NOT FDIC INSURED OR BANK
GUARANTEED.
- ------------------------------------------------------
- ------------------------------------------------------
