EQUITABLE LIFE INSURANCE
COMPANY OF IOWA
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO
RESEARCH PORTFOLIO
TOTAL RETURN PORTFOLIO
ANNUAL
REPORT
December 31, 1996
PRIMELITE
VARIABLE ANNUITY
The information contained in this report is intended for general informational
purposes only. This report is not authorized for distribution to prospective
investors unless preceded or accompanied by current Trust and Separate Account
prospectuses which contain important information concerning the Trust, the
Company, and its current public offering of variable annuity contracts.
Equi-Select Series Trust
OTC Portfolio, Research Portfolio and Total Return Portfolio
Annual Report
For the Period Ended December 31, 1996
Table of Contents
Letter to Contract Owners
Management's Discussion and Analysis
Equi-Select Series Trust Financial Statements
Report of Independent Auditors
Schedules of Investments
Statements of Assets and Liabilities
Statements of Operations
Statements of Changes in Net Assets
Financial Highlights
Notes to Financial Statements
Trustees and Executive Officers
LETTER TO CONTRACT OWNERS
Dear PrimElite Contract Owners:
We are pleased to present this Annual Report on behalf of the Equi-Select
Series Trust ("Trust"), one of the investment vehicles for the PrimElite
variable annuity product.
The following report provides detailed information regarding the performance
and year-end financial position of the OTC, Research and Total Return
Portfolios. For each of these Portfolios, we have also provided the return of
a benchmark index. A benchmark index allows you to compare your Portfolio's
return to the market return of comparable investments over the same time
period. Please note that Portfolio returns reflect expenses that apply to
the Trust, such as advisory, custodian, transfer agent, and legal fees.
Benchmark returns (except the Lipper Balanced Fund Index) do not include
these expenses. In general, the inclusion of a Portfolio's expenses reduces
its total return in comparison to the return of the benchmark index.
Equity portfolios performed very well during 1996. For the second
consecutive year, the Standard & Poors 500 Index had a total return of more
than twenty percent. The equity portfolios of the Trust had especially
strong performance during the year, as the OTC and Research Portfolios
outperformed their primary benchmarks. The Total Return Portfolio, which is
classified as a balanced portfolio, also outperformed its benchmark.
Assets under management continued to grow during 1996. At the end of 1996,
the combined net assets of the OTC, Research and Total Return Portfolios was
more than 300% higher than at December 31, 1995. This leads to further
efficiencies and economies of scale. As a result, operating expenses were
lower than they have ever been. We are pleased to announce that, effective
February 1, 1997, expense caps on these three portfolios will be lowered
significantly. Lower expenses translate into higher returns for you. For
additional information regarding these expense caps, please refer to your
prospectus or consult your representative.
We are committed to providing quality products and service to PrimElite
contract owners, and we look forward to helping you meet your financial
objectives. Thank you for your continued support.
Sincerely,
/s/ Paul R. Schlaak
Paul R. Schlaack
President and Chief Executive Officer
Equitable Investment Services, Inc.
President, Chairman, and Principal Executive Officer
Equi-Select Series Trust
OTC Portfolio
December 31, 1996
During 1996, the OTC PORTFOLIO had a total return of 20.68%. By comparison,
the Russell 2000 Index generated a total return of 16.55%.
The Portfolio's performance was driven by strong performance in the
technology sector. At the end of the year, the technology sector weighting
was more than 40%. This weighting was comprised of quality names from each
of the four main technology industry groups: software, hardware, networking
and semiconductors.
Software companies represent half of the Portfolio's technology holdings. The
Portfolio Manager focuses on companies that dominate a specific product
niche. For example, Electronic Arts dominates entertainment software,
Cadence Design Systems dominates electronic design automation software, and
Oracle Systems dominates the database and application software business.
Networking/telecommunications companies and medical technology companies also
contributed to the performance of the technology sector. Within the medical
technology industry, two large holdings were purchased, at a significant
premium, by larger medical device companies. Medisense was purchased by
Abbott Laboratories, and Ventritex was purchased by St. Jude Medical.
The Portfolio was the beneficiary of several other corporate buyouts, which
are almost always at a premium to the market price at the time the offer is
made. Announced acquisitions that were meaningful to the Portfolio include:
Sierra On-Line and Davidson & Associates by CUC International, Owen
Healthcare by Cardinal Health, Starsight Telecast by Gemstar International
Group, and MCI Communications by British Telecommunications PLC.
Health care is the second largest sector in the Portfolio. During 1996, the
health care sector had a negative impact on the Portfolio. HMO's
dramatically underperformed the market, as companies failed to realize price
increases to offset rising medical costs. Two other health care companies,
Mariner Health Group and Riscorp, were damaged by regulatory changes and
investigations.
MASSACHUSETTS FINANCIAL SERVICES COMPANY
*Inception date 10/4/94
AVERAGE ANNUAL TOTAL RETURN
Since
1 Year Inception*
--------- ----------
Portfolio 20.68% 23.77%
Russell 2000 16.55% 18.65%
S&P 500 22.96% 26.32%
The following performance graph provides comparative cummulative total
returns of the OTC Portfolio versus the Russell 2000 Index and the S&P 500
Index.
OTC Russell 2000 S&P 500
Portfolio Index Index
October 4, 1994 10,000 10,000 10,000
October 31, 1994 10,339 9,960 10,225
November 30, 1994 10,153 9,558 9,853
December 31, 1994 10,359 9,814 9,999
January 31, 1995 10,182 9,690 10,258
February 28, 1995 10,427 10,093 10,658
March 31, 1995 11,132 10,266 10,972
April 30, 1995 10,498 10,494 11,296
May 31, 1995 11,022 10,674 11,748
June 30, 1995 11,772 11,228 12,020
July 31, 1995 12,685 11,875 12,419
August 31, 1995 13,204 12,121 12,450
September 30, 1995 13,308 12,338 12,976
October 31, 1995 12,801 11,786 12,929
November 30, 1995 13,335 12,281 13,496
December 31, 1995 13,387 12,605 13,757
January 31, 1996 13,515 12,592 14,225
February 29, 1996 14,505 12,981 14,357
March 31, 1996 14,521 13,249 14,495
April 30, 1996 16,030 13,962 14,708
May 31, 1996 16,658 14,523 15,088
June 30, 1996 15,899 13,930 15,145
July 31, 1996 14,199 12,714 14,476
August 31, 1996 14,952 13,453 14,782
September 30, 1996 16,006 13,978 15,614
October 31, 1996 15,285 13,760 16,044
November 30, 1996 15,990 14,325 17,257
December 31, 1996 16,156 14,694 16,915
Total return of the Portfolio includes reinvestment of dividends and
distributions. It does not reflect charges for the variable annuity and
variable life contracts thereunder whose proceeds are invested in the
Portfolio. Inclusion of these charges would result in reducing the total
return figures for the period shown. Results represent past performance
and do not indicate future results.
The following shows the distribution by industry as a percentage of
investments for the OTC Portfolio.
Industry Percentage
Other Equity Securities 36.8%
Computer Software 18.0
Drugs & Health Care Services 17.4
Computer Software/Systems 12.3
Entertainment 6.7
Retail 5.8
Other Investments 3.0
Research Portfolio
December 31, 1996
The total return of the RESEARCH PORTFOLIO was 23.37% for the year ended
December 31, 1996. The S&P 500 Index had a return of 22.96% over the same
period.
Compared to the S&P 500 Index, the Portfolio was overweighted in the
technology, industrial goods & services, consumer staples, and business
services sectors. The Portfolio was underweighted in the energy and
utilities/communications sectors.
Within the technology sector, Microsoft, Compuware, BMC Software and Cisco
Systems all contributed to the Portfolio's performance over the past year.
These companies have developed strong competitive positions within their
industry, which has translated into successful stock performance.
Several companies in the financial services sector also performed well over
the past year. Life insurance companies such as Conseco, Allstate, and ITT
Hartford Group have implemented cost saving initiatives which have
contributed to earnings recently. In addition, several banks have benefited
from recent consolidations. Both Chase Manhattan and Bank of Boston have
proven that a successful merger or acquisition, coupled with a strong
management team, can contribute to earnings much sooner than expected.
Although the Portfolio was underweighted in the energy and
utilities/communications sectors, three companies in these sectors provided
strong returns during 1996. Newfield Exploration Company and PanEnergy
Corporation have been excellent additions to the Portfolio. MCI
Communications appreciated following the announced planned acquisition by
British Telecommunications PLC.
The Portfolio Manager will continue to seek fundamentally strong companies to
add to the Research Portfolio in the year ahead.
MASSACHUSETTS FINANCIAL SERVICES COMPANY
*Inception date 10/4/94
AVERAGE ANNUAL TOTAL RETURN
Since
1 Year Inception*
--------- ----------
Portfolio 23.37% 24.28%
S&P 500 22.96% 26.32%
The following performance graph provides comparative cummulative total
returns of the Research Portfolio versus the S&P 500 Index.
Research S&P 500
Portfolio Index
October 4, 1994 10,000 10,000
October 31, 1994 10,197 10,225
November 30, 1994 9,677 9,853
December 31, 1994 9,678 9,999
January 31, 1995 9,697 10,258
February 28, 1995 10,069 10,658
March 31, 1995 10,381 10,972
April 30, 1995 10,559 11,296
May 31, 1995 10,930 11,748
June 30, 1995 11,306 12,020
July 31, 1995 12,002 12,419
August 31, 1995 12,029 12,450
September 30, 1995 12,392 12,976
October 31, 1995 12,459 12,929
November 30, 1995 12,890 13,496
December 31, 1995 13,218 13,757
January 31, 1996 13,494 14,225
February 29, 1996 14,082 14,357
March 31, 1996 14,090 14,495
April 30, 1996 14,664 14,708
May 31, 1996 15,142 15,088
June 30, 1996 14,925 15,145
July 31, 1996 14,148 14,476
August 31, 1996 14,591 14,782
September 30, 1996 15,507 15,614
October 31, 1996 15,659 16,044
November 30, 1996 16,565 17,257
December 31, 1996 16,308 16,915
Total return of the Portfolio includes reinvestment of dividends and
distributions. It does not reflect charges for the variable annuity and
variable life contracts thereunder whose proceeds are invested in the
Portfolio. Inclusion of these charges would result in reducing the total
return figures for the period shown. Results represent past performance
and do not indicate future results.
TOP TEN INDUSTRIES
as a Percentage of Investments
Computer Software 7.9%
Retail 7.3%
Drugs & Health Care Services 7.2%
Aerospace 6.2%
Insurance 5.6%
Consumer Goods & Services 5.0%
Finance & Banking 4.2%
Computer Software - Systems 3.9%
Chemicals 3.8%
Telecommunications 3.8%
Total Return Portfolio
December 31, 1996
For the year ended December 31, 1996, the TOTAL RETURN PORTFOLIO provided a
total return of 13.70%. This compares to a 13.01% return for the Balanced
Fund Index, as reported by Lipper Analytical Services Inc.
Over the past year, the Portfolio held about 55% of its assets in common
stocks, preferred stocks and convertible bonds. This allocation provided the
bulk of the return for the Portfolio as a whole, as the U.S. stock market
posted spectacular gains. For example, the S&P 500 Index had a total return
of 22.96% over the 12-month period.
The remainder of the Portfolio was invested in a blend of corporate bonds and
U.S. treasury bonds, with an overall duration between 5 and 6 years. The
fixed income sector also provided positive returns, but the magnitude was far
less than that of the Portfolio's stock holdings. The Lehman Brothers
Government/Corporate Bond Index, which is fairly representative of the
Portfolio's bond allocation, had a total return of 3.28% during 1996.
During 1996, holdings in the energy and financial services sectors were
increased. Bank stocks had strong performance during the year. The earnings
of many banks have risen steadily, and an increase in merger activity has
made nearly all banks more valuable.
The Portfolio Manager also increased holdings in the health care sector.
Strong earnings and industry consolidation have improved the outlook for the
stocks of many companies in this sector.
During the year, the Portfolio Manager avoided the technology sector. In his
view, many of these stocks have high growth prospects but also have high
valuations, which means they often carry greater risk. The Portfolio was
also underweighted in consumer companies because of their inability to raise
prices. The U.S. consumer continues to demand more value at lower prices.
MASSACHUSETTS FINANCIAL SERVICES COMPANY
*Inception date 10/4/94
AVERAGE ANNUAL TOTAL RETURN
Since
1 Year Inception*
--------- ----------
Portfolio 13.70% 15.95%
Lipper Balanced
Fund Index 13.01% 15.80%
The following performance graph provides comparative cummulative total
returns of the Total Return Portfolio versus the Lipper Balanced Fund Index,
the Lehman Brothers Government/Corporate Bond Index and the S&P 500 Index.
The S&P 500 Index and the Lehman Brothers Government/Corporate Bond Index
will no longer be reported as comparable indices because the investment style
of the Lipper Balanced Fund Index compares more closely to the portfolio.
Lehman Brothers
Total Return Lipper Balanced Government/Corporate S&P 500
Portfolio Fund Index Bond Index Index
October 4, 1994 10,000 10,000 10,000 10,000
October 31, 1994 10,073 10,036 9,989 10,225
November 30, 1994 9,742 9,795 9,971 9,853
December 31, 1994 9,853 9,877 10,037 9,999
January 31, 1995 9,978 9,998 10,230 10,258
February 28, 1995 10,196 10,289 10,467 10,658
March 31, 1995 10,349 10,469 10,537 10,972
April 30, 1995 10,568 10,662 10,683 11,296
May 31, 1995 10,935 11,006 11,131 11,748
June 30, 1995 11,019 11,204 11,220 12,020
July 31, 1995 11,149 11,442 11,176 12,419
August 31, 1995 11,266 11,531 11,319 12,450
September 30, 1995 11,588 11,808 11,435 12,976
October 31, 1995 11,538 11,779 11,603 12,929
November 30, 1995 11,990 12,141 11,794 13,496
December 31, 1995 12,268 12,308 11,968 13,757
January 31, 1996 12,491 12,530 12,042 14,225
February 29, 1996 12,485 12,536 11,787 14,357
March 31, 1996 12,634 12,584 11,688 14,495
April 30, 1996 12,682 12,667 11,607 14,708
May 31, 1996 12,754 12,820 11,587 15,088
June 30, 1996 12,836 12,862 11,743 15,145
July 31, 1996 12,584 12,534 11,770 14,476
August 31, 1996 12,763 12,706 11,742 14,782
September 30, 1996 13,167 13,176 11,951 15,614
October 31, 1996 13,474 13,456 12,229 16,044
November 30, 1996 14,109 14,083 12,454 17,257
December 31, 1996 13,949 13,910 12,316 16,915
Total return of the Portfolio includes reinvestment of dividends and
distributions. It does not reflect charges for the variable annuity and
variable life contracts thereunder whose proceeds are invested in the
Portfolio. Inclusion of these charges would result in reducing the total
return figures for the period shown. Results represent past performance
and do not indicate future results.
The Lipper Balanced fund Index is the primary benchmark of the Portfolio
because its investment style compares more closely to the Portfolio than
either the S&P 500 Index or the Lehman Government/Corporate Bond Index.
Therefore, the S&P 500 Index and the Lehman Government/Corporate Bond
Index will no longer be reported as comparable indices.
The following shows the distribution by asset type as a percentage of
investments for the Total Return Portfolio.
Asset Type Percentage
Common Stocks 54.8%
Corporate Bonds 16.6
U.S. Treasuries 10.4
Short-Term Investments 7.6
Mortgage-Backed Securities 6.7
Other Investments 3.9
Report of Independent Auditors
To the Contractholders and Trustees
Equi-Select Series Trust
We have audited the accompanying statements of assets and liabilities,
including the schedules of investments, of the OTC, Research, and Total
Return Portfolios of Equi-Select Series Trust (the "Portfolios," three of the
portfolios constituting Equi-Select Series Trust, the "Trust") as of December
31, 1996, and the related statements of operations for the year then ended,
and the statements of changes in net assets and financial highlights for the
periods indicated therein. These financial statements and financial
highlights are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements and financial highlights. Our procedures
included confirmation of securities owned as of December 31, 1996, by
correspondence with the custodian and brokers, or other appropriate auditing
procedures where replies from brokers were not received. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of the
OTC, Research, and Total Return Portfolios of Equi-Select Series Trust at
December 31, 1996, the results of their operations, the changes in their net
assets, and the financial highlights for each of the periods indicated
therein, in conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Boston, Massachusetts
February 6, 1997
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS - 103.1%
AUTO PARTS - 0.1%
Autozone Incorporated, (a) 2,100 $57,750
AUTOMOBILES - 0.0%
United Auto Group Incorporated, (a) 100 2,575
BROADCASTING - 2.1%
American Radio Systems Corporation, (a) 2,100 57,225
Heritage Media Corporation, (a) 47,200 531,000
Lin Television Corporation, (a) 7,200 304,200
Metro Networks Incorporated, (a) 400 10,100
------------
902,525
BUSINESS SERVICES - 2.6%
Forrester Research Incorporated, (a) 100 2,575
HCIA Incorporated, (a) 28,800 993,600
IA Corporation I, (a) 20,700 121,612
Information Management Resources Incorporated, (a) 200 4,225
Sabre Group Holdings Incorporated, (a) 300 8,363
Superior Consultant Incorporated, (a) 100 2,475
Transaction Systems Architects Incorporated, (a) 200 6,650
XLConnect Solutions Incorporated, (a) 100 2,875
------------
1,142,375
COMMERCIAL SERVICES - 3.1%
ADT Ltd., (a) 21,200 484,950
CB Commercial Real Estate Services
Group Incorporated, (a) 1,400 28,000
Loewen Group Incorporated 21,700 849,012
------------
1,361,962
COMPUTERS & BUSINESS EQUIPMENT - 2.2%
Cabletron Systems Incorporated, (a) 28,600 950,950
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
COMPUTER SOFTWARE - 19.1%
Activision Incorporated, (a) 19,900 $256,212
Cadence Design Systems Incorporated, (a) 12,200 484,950
Compuserve Incorporated, (a) 11,000 108,625
Computer Associates International Incorporated, 5,100 253,725
Cooper & Chyan Technology Incorporated, (a) 16,100 527,275
DST Systems Incorporated Delaware, (a) 9,200 288,650
Edify Corporation, (a) 55,000 880,000
Electronic Arts, (a) 50,800 1,520,825
Epic Design Technology Incorporated, (a) 5,500 137,500
Microsoft Corporation, (a) 10,400 859,300
Oracle Systems Corporation, (a) 28,000 1,169,000
SAP AG, Series 1996 144A ADR* 1,500 68,250
Spectrum Holobyte Incorporated, (a) 228,500 1,713,750
Trusted Information Systems Incorporated, (a) 200 2,150
Versatility Incorporated, (a) 300 4,500
------------
8,274,712
COMPUTER SOFTWARE - SYSTEMS - 13.1%
Adobe Systems Incorporated 17,500 654,063
BMC Software Incorporated, (a) 26,100 1,079,887
Cisco Systems Incorporated, (a) 22,600 1,437,925
HBO & Company 7,200 427,500
Sun Microsystems Incorporated, (a) 65,000 1,669,687
Synopsys Incorporated, (a) 8,650 400,063
------------
5,669,125
DOMESTIC OIL - 1.1%
Carbo Ceramics Incorporated, (a) 22,800 478,800
DRUGS & HEALTH CARE SERVICES - 18.5%
Coventry Corporation, (a) 55,800 517,022
General Nutrition Companies Incorporated, (a) 32,900 555,187
Health Management Associates Incorporated, (a) 8,000 180,000
Healthsource Incorporated, (a) 25,800 338,625
Healthsouth Corporation, (a) 3,600 139,050
Mariner Health Group Incorporated, (a) 57,700 483,238
Owen Healthcare Incorporated, (a) 10,400 275,600
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
DRUGS & HEALTH CARE SERVICES (CONTINUED)
Pacificare Health Systems Incorporated, (a) 12,600 $1,023,750
Regency Health Services, (a) 8,100 77,963
Safeguard Health Enterprises, (a) 11,600 203,000
United Healthcare Corporation 18,189 818,505
Uromed Corporation, (a) 67,600 659,100
Ventritex Incorporated, (a) 74,700 1,839,487
Zoll Medical Corporation, (a) 84,700 910,525
------------
8,021,052
ELECTRICAL EQUIPMENT - 2.1%
Cable Design Technologies Corporation, (a) 28,700 893,288
ELECTRONICS -5.6%
Atmel Corporation, (a) 9,600 318,000
Intel Corporation 12,900 1,689,094
LSI Logic Corporation, (a) 15,300 409,275
------------
2,416,369
ENTERTAINMENT - 7.1%
Harrahs Entertainment Incorporated, (a) 13,900 276,263
Showboat Incorporated 26,100 450,225
Starsight Telecast Incorporated, (a) 249,700 2,340,937
------------
3,067,425
FINANCIAL SERVICES - 3.9%
Advanta Corporation, Class B 6,300 257,513
Countrywide Credit Incorporated 9,000 257,625
Delta Financial Corporation, (a) 200 3,600
Green Tree Financial Corporation 8,300 320,587
Metris Companies Incorporated, (a) 200 4,800
National Auto Credit Incorporated, (a) 17,450 209,400
United Companies Financial Corporation 24,500 652,312
------------
1,705,837
FOOD & BEVERAGES - 0.1%
Earthgrains Company 700 36,575
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
GAS EXPLORATION - 0.1%
Apache Corporation 500 $17,688
Offshore Energy Development Corporation, (a) 100 1,525
Snyder Oil Corporation 750 13,031
Titan Exploration Incorporated, (a) 1,800 21,600
------------
53,844
HOTELS & RESTAURANTS - 0.8%
Applebees International Incorporated 11,100 305,250
PJ America Incorporated, (a) 100 1,800
Promus Hotel Corporation, (a) 1,800 53,325
------------
360,375
INSURANCE - 1.1%
Compdent Corporation, (a) 9,800 345,450
Riscorp Incorporated, (a) 37,400 135,575
------------
481,025
LEISURE TIME - 0.8%
Argosy Gaming Corporation, (a) 62,500 289,062
Sodak Gaming Incorporated, (a) 4,100 63,038
------------
352,100
MEDICAL SUPPLIES - 0.9%
Nobel Biocare 11,800 207,628
St Jude Medical Incorporated, (a) 3,900 166,237
------------
373,865
MINING - 0.3%
Southern Africa Minerals Corporation, (a) 168,500 123,056
PETROLEUM SERVICES - 0.0%
National-Oilwell Incorporated, (a) 200 6,150
RAILROADS & EQUIPMENT - 1.1%
Kansas City Southern Industries Incorporated 3,500 157,500
Wisconsin Central Transportation Corporation, (a) 8,300 328,888
------------
486,388
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
RETAIL - 6.2%
Ann Taylor Stores Corporation, (a) 18,300 $320,250
Giordano International 280,000 238,929
Gymboree Corporation, (a) 32,500 743,438
Mazel Stores Incorporated, (a) 100 2,250
Nine West Group Incorporated, (a) 3,600 166,950
Office Depot Incorporated, (a) 6,800 120,700
Rite Aid Corporation 7,600 302,100
The Men's Wearhouse Incorporated, (a) 10,000 245,000
Viking Office Products Incorporated, (a) 20,000 533,750
------------
2,673,367
TELECOMMUNICATIONS - 6.1%
Aerial Communications Incorporated, (a) 37,600 305,500
Airtouch Communications, (a) 11,600 292,900
Ascend Communications Incorporated, (a) 3,400 211,225
Glenayre Technologies Incorporated, (a) 43,700 942,281
Pilipino Telephone, (a) 29,900 25,296
Rogers Cantel Mobile Incorporated, Class B, (a) 43,700 846,687
West TeleServices Corporation, (a) 400 9,100
------------
2,632,989
TELEPHONE - 5.0%
MCI Communications Corporation 37,100 1,212,706
Telephone & Data Systems Incorporated 26,000 942,500
------------
2,155,206
------------
TOTAL COMMON STOCK AND OTHER EQUITY
INTERESTS - (Cost $43,531,688) 44,679,685
PREFERRED STOCK - 0.4%
COMPUTER SOFTWARE - 0.4%
SAP AG 1,100 153,691
------------
TOTAL PERFERRED STOCK
- (Cost $174,935) 153,691
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Principal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CONVERTIBLE BONDS - 0.0%
MEDICAL SUPPLIES - 0.0%
Ventritex Incorporated, Senior Subordinated Note,
Convertible 5.750%, 08/15/2001 $10,000 $15,775
------------
TOTAL CONVERTIBLE BONDS
- (Cost $10,000) 15,775
SHORT TERM INVESTMENTS - 2.8%
FEDERAL AGENCIES - 2.8%
Federal Home Loan Mortgage Discount Note,
5.370%, 01/14/1997 1,200,000 1,197,673
------------
TOTAL SHORT TERM INVESTMENTS
- (Cost $1,197,673) 1,197,673
TOTAL INVESTMENTS - (Cost $44,914,296) - 106.3% 46,046,824
OTHER ASSETS LESS LIABILITIES - (6.3)% (2,725,244)
------------
NET ASSETS - 100.0% $43,321,580
============
<FN>
The percentage shown for each investment category is the
total value of that category as a percentage of the
net assets of the portfolio.
*Securities exempt from registration under Rule 144A of the
Securties Act of 1933. These securities may be resold in
transactions exempt from registration, normally to qualified
institutional buyers.
(a) Non-income producing securities.
ADR - American Depositary Receipts.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
RESEARCH PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS - 98.4%
AEROSPACE - 6.6%
General Dynamics Corporation 9,700 $683,850
Lockheed Martin Corporation 12,500 1,143,750
McDonnell Douglas Corporation 19,000 1,216,000
Newport News Shipbuilding Incorporated, (a) 36,400 546,000
United Technologies Corporation 21,000 1,386,000
------------
4,975,600
BROADCASTING - 0.9%
Clear Channel Communications Incorporated, (a) 4,200 151,725
Jacor Communications Incorporated, (a) 19,400 531,075
------------
682,800
BUILDING MATERIALS - 0.9%
Sherwin Williams Company 11,900 666,400
BUSINESS SERVICES - 2.5%
Accustaff Incorporated, (a) 42,800 904,150
First Data Corporation 16,000 584,000
Technology Solutions Company, (a) 8,900 369,350
------------
1,857,500
CHEMICALS - 4.1%
Air Products & Chemicals Incorporated 18,900 1,306,463
Betzdearborn Incorporated 2,500 146,250
Praxair Incorporated 35,500 1,637,437
------------
3,090,150
COMMERCIAL SERVICES - 0.3%
ISS International 7,500 197,342
COMPUTER SOFTWARE - 8.5%
Cadence Design Systems Incorporated, (a) 15,400 612,150
Cisco Systems Incorporated, (a) 11,500 731,687
Computer Associates International Incorporated 9,850 490,038
Compuware Corporation, (a) 5,300 265,663
DST Systems Incorporated Delaware, (a) 17,500 549,063
Electronic Arts, (a) 19,100 571,806
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
RESEARCH PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
COMPUTER SOFTWARE (CONTINUED)
Enator AB, (a) 7,700 $197,019
Enator AB, (a) 1,200 30,264
Microsoft Corporation, (a) 15,900 1,313,737
Oracle Systems Corporation, (a) 35,600 1,486,300
TT Tieto OY 1,600 135,270
------------
6,382,997
COMPUTER SOFTWARE - SYSTEMS - 4.2%
Adobe Systems Incorporated 13,900 519,513
Affiliated Computer Services Incorporated,
Class A, (a) 2,400 71,400
BMC Software Incorporated, (a) 17,900 740,612
Cabletron Systems Incorporated, (a) 13,100 435,575
Sun Microsystems Incorporated, (a) 25,300 649,894
Sybase Incorporated, (a) 11,100 185,231
Synopsys Incorporated, (a) 11,700 541,125
------------
3,143,350
CONGLOMERATES - 1.4%
Wharf Holdings 207,000 1,033,060
CONSUMER GOODS & SERVICES - 5.4%
Gillette Company 16,100 1,251,775
Philip Morris Companies Incorporated 13,200 1,486,650
Procter & Gamble Company 12,200 1,311,500
------------
4,049,925
COSMETICS & TOILETRIES - 1.0%
Lauder Estee Companies Incorporated 7,800 396,825
Revlon Incorporated, (a) 11,300 337,588
------------
734,413
DOMESTIC OIL - 1.1%
PanEnergy Corporation 18,100 814,500
DRUGS & HEALTH CARE SERVICES - 7.7%
Astra AB 21,600 1,042,010
Coventry Corporation, (a) 13,400 124,159
Novartis AG, (a) 307 351,221
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
RESEARCH PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
DRUGS & HEALTH CARE SERVICES (CONTINUED)
Pacificare Health Systems Incorporated,
Class A, (a) 7,500 $609,375
Pacificare Health Systems Incorporated,
Class B, (a) 4,900 417,725
St Jude Medical Incorporated, (a) 28,950 1,233,994
United Healthcare Corporation 23,700 1,066,500
Uromed Corporation, (a) 34,700 338,325
Ventritex Incorporated, (a) 23,600 581,150
Zoll Medical Corporation, (a) 4,400 47,300
------------
5,811,759
ELECTRONICS - 1.2%
Analog Devices Incorporated, (a) 10,500 355,687
Lattice Semiconductor Corporation, (a) 3,000 138,000
Xilinx Incorporated, (a) 10,400 382,850
------------
876,537
ENTERTAINMENT - 1.7%
MGM Grand Incorporated, (a) 13,800 481,275
Showboat Incorporated 11,900 205,275
Viacom Incorporated, (a) 17,900 624,262
------------
1,310,812
FINANCE & BANKING - 4.6%
Bank of Boston Corporation 9,040 580,820
Chase Manhattan Corporation 12,676 1,131,333
Compass Bancshares Incorporated 1,600 63,600
Crestar Financial Corporation 3,400 252,875
Fleet Financial Group Incorporated 9,300 463,837
Union Planters Corporation 18,762 731,718
Wing Hang Bank Ltd. 44,000 199,677
------------
3,423,860
FINANCIAL SERVICES - 2.1%
Advanta Corporation, Class B 19,500 797,062
Allstate Corporation 13,200 763,950
------------
1,561,012
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
RESEARCH PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
FOOD & BEVERAGES - 0.5%
Pepsico Incorporated 13,600 $397,800
FOOD PROCESSING - 2.8%
Earthgrains Company 8,100 423,225
Huhtamaki OY 10,500 488,478
McCormick & Company Incorporated 18,600 438,263
Tyson Foods Incorporated Delaware 22,200 760,350
------------
2,110,316
FOREST PRODUCTS - 1.9%
Kimberly Clark Corporation 14,800 1,409,700
GAS EXPLORATION - 0.4%
Newfield Exploration Company, (a) 10,000 260,000
GAS & PIPELINE UTILITIES - 1.2%
Coastal Corporation 18,100 884,637
HOUSEHOLD PRODUCTS - 1.8%
Colgate Palmolive Company 14,600 1,346,850
INDUSTRIAL MACHINERY - 1.7%
Case Corporation 23,800 1,297,100
INSURANCE - 6.0%
Amerin Corporation, (a) 7,700 198,275
Chubb Corporation 8,900 478,375
Cigna Corporation 9,100 1,243,288
Conseco Incorporated 6,500 414,375
ITT Hartford Group Incorporated 9,800 661,500
Penncorp Financial Group Incorporated 31,100 1,119,600
Riscorp Incorporated, (a) 5,200 18,850
Union Assured Federal 3,300 407,054
------------
4,541,317
LODGING - 3.5%
HFS Incorporated, (a) 21,100 1,260,725
Host Marriott Corporation, (a) 52,600 841,600
Jarvis Hotels* 147,600 407,120
Promus Hotel Corporation, (a) 3,750 111,094
------------
2,620,539
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
RESEARCH PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
MACHINE DIVERSIFIED - 0.8%
Stanley Works 23,000 $621,000
MEDICAL SUPPLIES - 0.4%
Nobel Biocare 18,600 327,278
OIL & GAS - 3.6%
Barrett Resources Corporation, (a) 11,300 481,662
British Petroleum PLC 6,433 909,465
Mobil Corporation 6,900 843,525
Transocean Offshore Incorporated 7,500 469,688
------------
2,704,340
PHARMACEUTICALS - 2.0%
Pfizer Incorporated 7,400 613,275
Pharmacia & Upjohn Incorporated 13,200 523,050
Rhone Poulenc Rorer Incorporated 5,000 390,625
------------
1,526,950
RAILROADS & EQUIPMENT - 2.4%
Conrail Incorporated 5,127 510,777
Wisconsin Central Transportation Corporation, (a) 32,800 1,299,700
------------
1,810,477
RETAIL - 7.9%
Alco Standard Corporation 15,000 774,375
AnnTaylor Stores Corporation, (a) 21,900 383,250
Compusa Incorporated, (a) 28,100 579,563
Giordano International 416,000 354,981
Gymboree Corporation, (a) 19,400 443,775
Hollywood Entertainment Corporation, (a) 8,200 151,700
Home Depot Incorporated 9,600 481,200
Kwik Fit Holdings 98,100 365,543
Lowes Companies Incorporated 10,800 383,400
Nike Incorporated 6,400 382,400
Reebok International Ltd. 5,300 222,600
Safeway Incorporated, (a) 22,800 974,700
Staples Incorporated, (a) 17,300 312,481
Storehouse PLC 22,700 100,530
------------
5,910,498
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
RESEARCH PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
TELECOMMUNICATIONS - 4.1%
Glenayre Technologies Incorporated, (a) 23,100 $498,094
Korea Mobile Telecomm ADR 23,648 304,468
Loral Space & Communications, (a) 30,100 553,087
Lucent Technologies Incorporated 10,800 499,500
MCI Communications Corporation 26,100 853,144
Ote Greek Telecom 12,000 205,018
Pilipino Telephone, (a) 172,000 145,513
------------
3,058,824
TELECOMMUNICATION EQUIPMENT - 0.2%
Ascend Communications Incorporated, (a) 2,900 180,163
TIRES & RUBBER - 0.5%
BF Goodrich Company 9,600 388,800
TOYS & AMUSEMENTS - 1.0%
Tyco International Ltd 14,700 777,262
TRANSPORTATION - 0.9%
Burlington Northern Santa Fe 8,000 691,000
UTILITIES - 0.6%
Telecom Italia Mobile 332,300 474,245
------------
TOTAL COMMON STOCK AND OTHER EQUITY
INTERESTS - (Cost $66,912,582) 73,951,113
PREFERRED STOCK - 0.1%
COMPUTER SOFTWARE - 0.1%
SAP AG 800 111,775
------------
TOTAL PREFERRED STOCK
- (Cost $131,354) 111,775
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
RESEARCH PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Principal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
SHORT TERM INVESTMENTS - 8.8%
FEDERAL AGENCIES - 8.8%
Federal Home Loan Bank,
Discount Note,
5.500%, 01/10/1997 $2,300,000 $2,296,838
Federal Home Loan Mortgage Association,
Discount Note,
5.380%, 01/16/1997 1,328,000 1,325,023
Student Loan Marketing Association,
Discount Note,
6.300%, 01/02/1997 3,000,000 2,999,475
------------
TOTAL SHORT TERM INVESTMENTS
- (Cost $6,621,336) 6,621,336
------------
TOTAL INVESTMENTS - (Cost $73,665,272) - 107.3% 80,684,224
OTHER ASSETS LESS LIABILITIES - (7.3)% (5,505,382)
------------
NET ASSETS - 100.0% $75,178,842
============
<FN>
The percentage shown for each investment category is the
total value of that category as a percentage of the
net assets of the portfolio.
*Securities 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.
(a) Non-income producing securities.
ADR - American Depositary Receipts.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Principal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
MORTGAGE PASS-THROUGHS - 0.2%
COLLATERALIZED MORTGAGE OBLIGATIONS - 0.2%
BCF LLC, Mortgage Pass-through
Certificate Series 1996 R1,
7.750%, 09/25/2026* $99,752 $96,666
------------
TOTAL MORTGAGE PASS-THROUGHS
- (Cost $95,482) 96,666
Shares
------------
COMMON STOCK AND OTHER EQUITY INTERESTS - 56.3%
AEROSPACE - 2.9%
General Dynamics Corporation 4,500 317,250
Lockheed Martin Corporation 2,200 201,300
Newport News Shipbuilding Incorporated, (a) 180 2,700
Raytheon Company 6,900 332,062
United Technologies Corporation 12,500 825,000
------------
1,678,312
ALUMINUM - 0.5%
Aluminum Company of America 4,300 274,125
APPAREL & TEXTILES - 0.6%
VF Corporation 5,200 351,000
AUTO PARTS - 0.4%
Dana Corporation 6,500 212,063
AUTOMOBILES - 0.8%
Ford Motor Company 9,000 286,875
General Motors Corporation 1,500 83,625
Volvo Aktiebolaget ADR 3,900 84,825
------------
455,325
BUILDING MATERIALS - 0.4%
Sherwin Williams Company 3,900 218,400
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
CHEMICALS - 2.9%
Air Products & Chemicals Incorporated 2,000 $138,250
Dow Chemical Company 2,200 172,425
DuPont, E I De Nemours & Company 4,100 386,937
Nalco Chemical Company 5,400 195,075
Olin Corporation 3,600 135,450
Praxair Incorporated 3,900 179,888
Rohm & Haas Company 3,800 310,175
Witco Corporation 4,600 140,300
------------
1,658,500
COMPUTERS & BUSINESS EQUIPMENT - 0.9%
Digital Equipment Corporation, (a) 6,600 240,075
International Business Machines 1,800 271,800
------------
511,875
CONGLOMERATES - 0.3%
Eastern Enterprises 4,000 141,500
Tenneco Incorporated, (a) 900 40,613
------------
182,113
CONSUMER GOODS & SERVICES - 1.3%
Avon Products Incorporated 1,400 79,975
Philip Morris Companies Incorporated 6,050 681,381
------------
761,356
DOMESTIC OIL - 0.7%
PanEnergy Corporation 8,800 396,000
DRUGS & HEALTH CARE SERVICES - 3.6%
American Home Products Corporation 5,600 328,300
Astra AB 4,400 215,600
Columbia/HCA Healthcare Corporation 4,900 199,675
National Health Investments Incorporated 300 11,362
Novartis AG, (a) 437 500,852
Smithkline Beecham PLC, ADR 7,400 503,200
United Healthcare Corporation 6,200 279,000
------------
2,037,989
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
ELECTRICAL EQUIPMENT - 1.6%
General Electric Company 6,700 $662,462
Honeywell Incorporated 3,450 226,838
------------
889,300
ELECTRIC UTILITIES - 1.9%
Allegheny Power Systems Incorporated 3,400 103,275
DPL Incorporated 3,000 73,500
FPL Group Incorporated 6,200 285,200
Peco Energy Company 3,700 93,425
Pinnacle West Capital Corporation 6,300 200,025
Portland General Corporation 4,900 205,800
Texas Utilities Company 3,700 150,775
------------
1,112,000
ELECTRONICS - 0.1%
Analog Devices Incorporated, (a) 1,300 44,038
ENVIRONMENTAL CONTROL - 0.3%
Browning Ferris Industries Incorporated 5,800 152,250
FEDERAL AGENCIES - 0.6%
Federal Home Loan Mortgage Corporation 3,000 330,375
FINANCE & BANKING - 4.9%
Bank of Boston Corporation 5,400 346,950
Bank of New York Incorporated 11,300 381,375
Chase Manhattan Corporation 6,428 573,699
Comerica Incorporated 1,400 73,325
Crestar Financial Corporation 2,000 148,750
Fleet Financial Group Incorporated 7,700 384,037
Nationsbank Corporation 4,800 469,200
Southern National Corporation 11,600 420,500
------------
2,797,836
------------
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
FINANCIAL SERVICES - 3.3%
Allstate Corporation 6,300 $364,612
American Express Company 6,700 378,550
Associates First Capital Corporation 800 35,300
National City Corporation 10,000 448,750
Northern Trust Corporation 2,400 87,000
Norwest Corporation 7,000 304,500
Travelers Incorporated 6,133 278,285
------------
1,896,997
FOOD & BEVERAGES - 1.1%
Anheuser Busch Companies Incorporated 1,400 56,000
General Mills Incorporated 4,500 285,188
Lion Nathan Limited 7,700 18,454
McCormick & Company Incorporated 4,900 115,456
Pepsico Incorporated 5,000 146,250
------------
621,348
FOREST PRODUCTS - 0.3%
Weyerhaeuser Company 3,600 170,550
GAS EXPLORATION - 1.7%
Occidental Petroleum Corporation 13,600 317,900
Repsol S.A. ADR 5,300 202,062
USX-Marathon Group 19,800 472,725
------------
992,687
GAS & PIPELINE UTILITIES - 1.4%
Coastal Corporation 6,600 322,575
El Paso Natural Gas Company 84 4,227
Pacific Enterprises 1,700 51,637
Sonat Incorporated 4,000 206,000
Williams Companies Incorporated 5,640 211,500
------------
795,939
HOUSEHOLD PRODUCTS - 0.6%
Colgate Palmolive Company 3,100 285,975
Rubbermaid Incorporated 3,300 75,075
------------
361,050
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
INSURANCE - 2.4%
Chubb Corporation 4,300 $231,125
Cigna Corporation 3,300 450,862
St. Paul Companies, Incorporated 6,000 351,750
Torchmark Incorporated 6,600 333,300
------------
1,367,037
MACHINE DIVERSIFIED - 1.0%
Deere & Company 9,300 377,813
Stanley Works 8,200 221,400
------------
599,213
MANUFACTURING - 1.7%
Allied Signal Incorporated 7,200 482,400
American Brands Incorporated 3,700 183,612
Cooper Industries Incorporated 3,700 155,863
Dexter Corporation 5,000 159,375
------------
981,250
MEDICAL SUPPLIES - 0.5%
Baxter International Incorporated 4,300 176,300
St Jude Medical, Incorporated, (a) 2,000 85,250
------------
261,550
METALS - 0.1%
Phelps Dodge Corporation 1,000 67,500
OIL & GAS - 6.0%
Amoco Corporation 4,400 354,200
Atlantic Richfield Company 2,400 318,000
British Petroleum PLC 4,927 696,555
Exxon Corporation 4,200 411,600
Mobil Corporation 3,400 415,650
Royal Dutch Petroleum Company 3,300 563,475
Sun Incorporated 1,200 29,250
Texaco Incorporated 4,200 412,125
Union Pacific Resources Group Incorporated 7,200 210,600
------------
3,411,455
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
PETROLEUM SERVICES - 0.8%
Schlumberger Ltd. 3,700 $369,538
Ultramar Corporation 2,000 63,250
------------
432,788
PHARMACEUTICALS - 1.0%
Pharmacia & Upjohn Incorporated 7,900 313,038
Rhone Poulenc Rorer Incorporated 3,600 281,250
------------
594,288
PHOTOGRAPHY - 0.8%
Eastman Kodak Company 5,900 473,475
POLLUTION CONTROL - 0.3%
WMX Technologies Incorporated 5,700 185,963
RAILROADS & EQUIPMENT - 0.8%
Canadian National Railway Company 1,200 45,658
CSX Corporation 3,300 139,425
Illinois Central Corporation 8,700 278,400
------------
463,483
REAL ESTATE - 0.8%
Arden Reality Group Incorporated 2,000 55,500
Hospitality Properties Trust 8,000 232,000
Meditrust Corporation 4,800 192,000
------------
479,500
RETAIL - 1.4%
May Department Stores Company 3,300 154,275
Rite Aid Corporation 1,600 63,600
Sears, Roebuck & Company 6,300 290,587
Wal Mart Stores Incorporated 5,800 132,675
York International Corporation 3,000 167,625
------------
808,762
STEEL - 0.2%
Timet Capital Trust I,* (a) 2,400 130,500
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
COMMON STOCK AND OTHER EQUITY INTERESTS (CONTINUED)
TELECOMMUNICATIONS - 0.9%
GTE Corporation 8,800 $400,400
Telephone & Data Systems Incorporated 2,800 101,500
------------
501,900
TELEPHONE - 1.2%
Ameritech Corporation 3,300 200,062
AT&T Corporation 1,100 47,850
MCI Communications Corporation 13,200 431,475
------------
679,387
TIRES & RUBBER - 0.9%
BF Goodrich Company 12,000 486,000
TOBACCO - 0.1%
Dimon Incorporated 3,600 83,250
TRANSPORTATION - 0.6%
Burlington Northern Santa Fe 4,000 345,500
UTILITIES - 1.7%
Bellsouth Corporation 6,700 270,512
Carolina Power & Light Company 7,100 259,150
CMS Energy Corporation 8,000 269,000
UGI Corporation New 8,100 181,238
------------
979,900
------------
TOTAL COMMON STOCK AND OTHER EQUITY INTERESTS
- (Cost $28,334,003) 32,234,129
Principal
Amount
CORPORATE BONDS AND NOTES - 16.8% ------------
AEROSPACE - 0.4%
Jet Equipment, Series A-10 144A
9.410%, 06/15/2010* $50,000 57,692
8.640%, 11/01/2012* 48,584 52,709
10.690%, 05/01/2015* 10,000 12,072
Northrop Grumman Corporation
9.375%, 10/15/2024 100,000 110,551
------------
233,024
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CORPORATE BONDS AND NOTES (CONTINUED)
AIRLINES - 0.9%
Continental Airlines, 144A
9.500%, 12/15/2001* $150,000 $153,000
9.500%, 10/15/2013* 100,000 112,491
10.220%, 07/02/2014* 24,995 29,275
Delta Air Lines Incorporated
8.500%, 03/15/2002 100,000 105,881
10.375%, 12/15/2022 50,000 62,944
Quantas Airways Ltd.
7.500%, 06/30/2003* 50,000 51,136
------------
514,727
BROADCASTING - 1.1%
Continental Cablevision Incorporated
8.300%, 05/15/2006 100,000 106,527
Tele-Communications Incorporated
7.385%, 08/27/2001 525,000 530,198
------------
636,725
BUILDING CONSTRUCTION - 0.2%
Owens Corning Fiberglass Corporation
8.875%, 06/01/2002 10,000 10,844
USG Corporation
9.250%, 09/15/2001 100,000 106,500
------------
117,344
COMMERCIAL SERVICES - 0.6%
Loewen Group Interest, 144A
7.500%, 04/15/2001* 220,000 220,275
Stewart Enterprises Incorporated
6.700%, 12/01/2003 100,000 99,019
------------
319,294
COMPUTERS & BUSINESS EQUIPMENT - 0.2%
International Business Machines
7.125%, 12/01/2096 100,000 95,083
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CORPORATE BONDS AND NOTES (CONTINUED)
CONTAINERS & GLASS - 0.2%
Crown Cork & Seal Finance
7.000%, 12/15/2006 $100,000 $99,136
DRUGS & HEALTH CARE SERVICES - 0.1%
Tenet Healthcare Corporation
8.625%, 12/01/2003 40,000 42,200
10.125%, 03/01/2005 10,000 11,075
------------
53,275
ELECTRIC UTILITIES - 2.9%
Arkansas Power & Light Company
8.750%, 03/01/2026 20,000 20,604
El Paso Electric Company
8.900%, 02/01/2006 100,000 104,264
Empresa Electric Peh
7.300%, 05/01/2003 300,000 303,273
Empresa Electrica Del Norte, 144A
7.750%, 03/15/2006* 50,000 50,408
Enersis SA
6.900%, 12/01/2006 95,000 92,719
First PV Funding Corporation
10.300%, 01/15/2014 220,000 234,300
10.150%, 01/15/2016 30,000 31,875
Long Island Lighting Company
8.900%, 07/15/2019 100,000 102,025
9.000%, 11/01/2022 150,000 157,875
9.625%, 07/01/2024 10,000 10,635
Louisiana Power & Light Company
10.670%, 01/02/2017 10,000 10,703
10.670%, 01/02/2017 10,000 10,703
8.750%, 03/01/2026 10,000 10,470
Midland Funding Corporation II
11.750%, 07/23/2005 10,000 11,072
Niagara Mohawk Power Corporation
8.000%, 06/01/2004 150,000 144,102
Oryx Energy Company
10.000%, 04/01/2001 100,000 109,769
PacifiCorp Holdings PPW, 144A
7.200%, 04/01/2006* 50,000 49,587
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CORPORATE BONDS AND NOTES (CONTINUED)
ELECTRIC UTILITIES (CONTINUED)
System Energy Resources Incorporated
7.800%, 08/01/2000 $100,000 $101,208
Texas-New Mexico Power Company
12.500%, 01/15/1999 100,000 108,635
Utilicorp United Incorporated
8.450%, 11/15/1999 10,000 10,461
------------
1,674,688
ENTERTAINMENT - 1.0%
Circus Circus Enterprises Incorporated
6.700%, 11/15/2096 100,000 98,352
Time Warner Incorporated
7.450%, 02/01/1998 250,000 252,753
8.375%, 03/15/2023 200,000 202,774
------------
553,879
FINANCE & BANKING - 1.1%
ABN Amro Bank NV Chicago Branch
7.300%, 12/01/2026 100,000 95,080
Auburn Hills Trust
12.000%, 05/01/2020 15,000 22,739
Bankamerica Capital II
8.000%, 12/15/2026 100,000 101,370
Capital One Bank
6.750%, 11/06/2000 100,000 99,875
Hubco Company, 144A
8.200%, 09/15/2006* 100,000 104,375
MBNA Capital I
8.278%, 12/01/2026 100,000 100,375
NB Capital Trust II
7.830%, 12/15/2026 100,000 99,695
------------
623,509
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CORPORATE BONDS AND NOTES (CONTINUED)
FINANCIAL SERVICES - 2.6%
Advanta Capital Trust I, 144A
8.990%, 12/17/2026* $100,000 $100,155
Advanta Corporation
7.470%, 09/10/2001 100,000 101,724
Alex Brown Incorporated
7.625%, 08/15/2005 40,000 40,810
American Re Corporation, 144A
7.450%, 12/15/2026* 100,000 100,081
Capital One Financial Corporation
7.250%, 12/01/2003 100,000 98,750
ContiFinancial Corporation
8.375%, 08/15/2003 50,000 51,500
Equitable Life Assured Society
7.700%, 12/01/2015 120,000 119,950
Financiera Energetica
9.375%, 06/15/2006 50,000 53,125
First USA Capital Trust I, 144A
9.330%, 01/15/2027* 100,000 99,897
Humpuss Funding Corporation, 144A
7.720%, 12/15/2009* 100,000 98,713
Lehman Brothers Holdings Incorporated
6.400%, 12/27/1999 100,000 99,480
7.125%, 09/15/2003 100,000 99,923
7.500%, 08/01/2026 100,000 101,389
Mellon Capital II
7.995%, 01/15/2027 100,000 100,000
Salton Sea Funding Corporation
7.370%, 05/30/2005 20,000 19,971
7.840%, 05/30/2010 100,000 100,547
State Street Institutional Capital A,
Series A 144A
7.940%, 12/30/2026* 100,000 97,625
------------
1,483,640
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CORPORATE BONDS AND NOTES (CONTINUED)
FOOD & BEVERAGES - 0.6%
Price Costco Incorporated
7.125%, 06/15/2005 $100,000 $100,012
RJR Nabisco Incorporated
8.750%, 04/15/2004 125,000 126,158
8.750%, 07/15/2007 120,000 119,815
7.550%, 06/15/2015 20,000 19,835
------------
365,820
FOREST PRODUCTS - 0.3%
Boise Cascade Corporation
7.430%, 10/10/2005 100,000 101,625
Canadian Pacific Forest Products Ltd.
9.250%, 06/15/2002 50,000 50,799
Georgia Pacific Corporation
9.875%, 11/01/2021 10,000 11,178
------------
163,602
GAS EXPLORATION - 1.2%
Enserch Exploration Incorporated, 144A
7.540%, 01/02/2009* 100,000 98,500
Gulf Canada Resources Ltd.
8.350%, 08/01/2006 100,000 104,250
Husky Oil Ltd.
7.125%, 11/15/2006 240,000 240,010
Petroliam Nasional Berhad, 144A
7.625%, 10/15/2026* 250,000 252,017
------------
694,777
GAS & PIPELINE UTILITIES - 0.3%
Coastal Corporation
7.750%, 10/15/2035 200,000 203,614
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CORPORATE BONDS AND NOTES (CONTINUED)
INSURANCE - 0.2%
Fairfax Financial Holdings Ltd.
8.300%, 04/15/2026 $15,000 $15,651
Liberty Mutual Insurance Company, 144A
8.200%, 05/04/2007* 20,000 21,239
Nationwide Mutual Life, 144A
7.500%, 02/15/2024* 100,000 93,202
------------
130,092
MANUFACTURING - 0.2%
Mark IV Industries Incorporated, 144A
7.750%, 04/01/2006* 125,000 122,813
OIL & GAS - 1.4%
Louis Dreyfus Natural Gas Corporation
9.250%, 06/15/2004 100,000 108,000
Mitchell Energy & Development Corporation
6.750%, 02/15/2004 100,000 93,390
NGC Corporation
7.625%, 10/15/2026 100,000 101,495
Oryx Energy Company
8.000%, 10/15/2003 100,000 101,175
8.375%, 07/15/2004 100,000 103,753
Ras Laffan Liquefied Natural Gas, 144A
8.294%, 03/15/2014* 100,000 100,250
Tosco Corporation
7.625%, 05/15/2006 200,000 206,484
------------
814,547
REAL ESTATE - 0.2%
Taubman Reality Group Ltd. Partner
8.000%, 07/30/2001 100,000 103,213
TELECOMMUNICATIONS - 0.4%
360 Communications
7.500%, 03/01/2006 133,000 131,924
Total Access Communication, 144A
8.375%, 11/04/2006* 100,000 100,331
------------
232,255
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
CORPORATE BONDS AND NOTES (CONTINUED)
TOBACCO - 0.2%
Philip Morris Companies Incorporated
7.650%, 07/01/2008 $100,000 $102,127
UTILITIES - 0.5%
California Energy Incorporated
0.000%, 01/15/2004 (b) 75,000 79,031
Cleveland Electric Illuminating Company
9.250%, 07/29/1999 100,000 104,396
9.375%, 03/01/2017 100,000 102,561
------------
285,988
------------
TOTAL CORPORATE BONDS AND NOTES
- (Cost $9,497,973) 9,623,172
CONVERTIBLE BONDS - 0.3%
CONGLOMERATES - 0.2%
ADT Operations Incorporated
Zero Coupon, 07/06/2010 105,000 68,775
Valhi Incorporated
Zero Coupon, 10/20/2007 68,000 32,045
------------
100,820
FINANCIAL SERVICES - 0.1%
National Data Corporation
5.000%, 11/01/2003 40,000 42,500
------------
TOTAL CONVERTIBLE BONDS
- (Cost $109,917) 143,320
Shares
------------
PREFERRED STOCK - 3.0%
CHEMICALS - 0.3%
Henkel KGaA, (a) 3,800 190,889
CONSTRUCTION & MINING EQUIPMENT - 0.5%
Case Corporation 2,300 305,325
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Security Description Shares Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
PREFERRED STOCK (CONTINUED)
FINANCIAL SERVICES - 0.7%
Finova Finance Trust 1,900 $99,750
Salomon Incorporated, (a) 300 18,075
Sci Finance Llc 1,300 122,362
Travelers Capital III 180,000 173,081
------------
413,268
GAS EXPLORATION - 0.0%
Occidental Petroleum Corporation* 500 28,500
HOTELS & RESTAURANTS - 0.6%
Host Marriott Financial Trust,* 6,200 329,375
HOUSEHOLD PRODUCTS - 0.1%
Corning Delaware LP 500 31,813
OIL & GAS - 0.5%
Enron Corporation 4,800 115,200
Unocal Corporation 3,455 196,071
------------
311,271
TELECOMMUNICATIONS - 0.3%
Loral Space & Communications,* (a) 3,200 180,800
------------
TOTAL PREFERRED STOCK
- (Cost $1,637,331) 1,791,241
Principal
Amount
------------
FOREIGN GOVERNMENT BOND - 0.9%
GOVERNMENT AGENCY - 0.9%
Argentenia Republic
9.250%, 02/23/2001 $60,000 60,900
Colombia Republic
8.700%, 02/15/2016 60,000 57,871
Peoples Republic China
7.750%, 07/05/2006 200,000 206,198
Republic of South Africa
8.375%, 10/17/2006 100,000 99,998
United Mexican States
11.375%, 09/15/2016 100,000 105,000
------------
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
FOREIGN GOVERNMENT BOND (CONTINUED)
TOTAL FOREIGN GOVERNMENT BOND
- (Cost $516,780) $529,967
U.S. GOVERNMENT AND AGENCY SECURITIES - 17.4%
MORTGAGE-BACKED OBLIGATIONS - 6.7%
Federal National Mortgage Association
8.000%, 12/01/2026 $3,535,000 3,601,493
Government National Mortgage Association
7.500%, 04/15/2008 233,106 238,074
------------
3,839,567
U.S. TREASURIES - 10.7%
United States Treasury Bond
12.000%, 05/15/2005 90,000 122,203
12.000%, 08/15/2013 155,000 221,723
6.750%, 08/15/2026 859,000 865,442
United States Treasury Note
9.125%, 05/15/1999 1,900,000 2,030,321
6.625%, 06/30/2001 2,000,000 2,032,180
7.500%, 11/15/2001 450,000 473,699
6.500%, 10/15/2006 400,000 402,188
------------
6,147,756
------------
TOTAL U.S. GOVERNMENT AND AGENCY SECURITIES
- (Cost $10,027,749) 9,987,323
SHORT TERM INVESTMENTS - 7.8%
FEDERAL AGENCIES - 7.8%
Federal Home Loan Bank
Consolidated Discount Notes,
5.250%, 01/02/1997 2,600,000 2,599,621
Federal Home Loan Bank
Consolidated Discount Notes,
5.500%, 01/09/1997 1,870,000 1,867,714
------------
TOTAL SHORT TERM INVESTMENTS
- (Cost $4,467,335) 4,467,335
------------
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
TOTAL RETURN PORTFOLIO
SCHEDULE OF INVESTMENTS
December 31, 1996
<TABLE>
<CAPTION>
Pricipal
Security Description Amount Value
- ---------------------------------------------------- ------------ ------------
<S> <C> <C>
TOTAL INVESTMENTS - (Cost $54,686,570) - 102.7% $58,873,153
OTHER ASSETS LESS LIABILITIES - (2.7)% (1,571,190)
------------
NET ASSETS - 100.0% $57,301,963
============
<FN>
The percentage shown for each investment category is the
total value of that category as a percentage of the
net assets of the portfolio.
*Securities 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.
(a) Non-income producing securities.
(b) Step-up security will start to accrue interest on
1/15/1997 at a rate of 10.25%.
ADR - American Depositary Receipts.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1996
<TABLE>
<CAPTION>
OTC
Portfolio
______________
<S> <C>
ASSETS
Investments in securities, at value (a) $46,046,824
Cash, including foreign currency, at value 373,946
Receivable for securities sold 163,701
Receivable for currency sold --
Interest receivable 208
Dividends receivable 3,474
Receivable for fund shares sold 329,942
Foreign income tax reclaim receivable --
Prepaid insurance 2,402
Deferred organization costs 6,789
______________
TOTAL ASSETS 46,927,286
LIABILITIES
Payable for securities purchased 1,337,759
Payable for currency purchased --
Payable for fund shares repurchased 2
Distributions payable 2,207,145
Payable for audit fees 4,353
Payable for custody fees 15,823
Payable for organization expense 6,788
Payable to Investment Adviser (Note 3) 29,325
Accounts payable and accrued expenses 4,511
______________
TOTAL LIABILITIES 3,605,706
______________
NET ASSETS $43,321,580
==============
NET ASSETS CONSIST OF:
Paid-in capital (Note 5) $41,815,951
Undistributed net investment income (loss) (Note 2) --
Accumulated net realized gain on investments and
foreign currency transactions 373,101
Net unrealized appreciation (depreciation) of:
Investments 1,132,528
Foreign currency translations --
______________
NET ASSETS $43,321,580
==============
</TABLE>
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1996
(Continued)
<TABLE>
<CAPTION>
OTC
Portfolio
______________
<S> <C>
NET ASSET VALUE PER SHARE
Offering and redemption price per share (based on shares of
beneficial interest outstanding) $13.82
Total shares outstanding at end of period 3,134,213
(a) Investments in securities and repurchase agreements, at cost $44,914,296
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1996
<TABLE>
<CAPTION>
Research
Portfolio
______________
<S> <C>
ASSETS
Investments in securities, at value (a) $80,684,224
Cash, including foreign currency, at value 393,028
Receivable for securities sold 18,088
Receivable for currency sold 156,408
Interest receivable --
Dividends receivable 73,294
Receivable for fund shares sold 437,268
Foreign income tax reclaim receivable 3,591
Prepaid insurance 2,402
Deferred organization costs 6,789
______________
TOTAL ASSETS 81,775,092
LIABILITIES
Payable for securities purchased 4,326,294
Payable for currency purchased 156,000
Payable for fund shares repurchased --
Distributions payable 2,011,939
Payable for audit fees 4,353
Payable for custody fees 35,294
Payable for organization expense 6,788
Payable to Investment Adviser (Note 3) 49,700
Accounts payable and accrued expenses 5,882
______________
TOTAL LIABILITIES 6,596,250
______________
NET ASSETS $75,178,842
==============
NET ASSETS CONSIST OF:
Paid-in capital (Note 5) $67,306,275
Undistributed net investment income (loss) (Note 2) (73)
Accumulated net realized gain on investments and
foreign currency transactions 853,133
Net unrealized appreciation (depreciation) of:
Investments 7,018,984
Foreign currency translations 523
______________
NET ASSETS $75,178,842
==============
</TABLE>
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1996
(Continued)
<TABLE>
<CAPTION>
Research
Portfolio
______________
<S> <C>
NET ASSET VALUE PER SHARE
Offering and redemption price per share (based on shares of
beneficial interest outstanding) $15.43
Total shares outstanding at end of period 4,872,075
(a) Investments in securities and repurchase agreements, at cost $73,665,272
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1996
<TABLE>
<CAPTION>
Total
Return
Portfolio
______________
<S> <C>
ASSETS
Investments in securities, at value (a) $58,873,153
Cash, including foreign currency, at value 144,972
Receivable for securities sold 7,170
Receivable for currency sold --
Interest receivable 277,621
Dividends receivable 77,541
Receivable for fund shares sold 628,315
Foreign income tax reclaim receivable 1,263
Prepaid insurance 2,402
Deferred organization costs 6,789
______________
TOTAL ASSETS 60,019,226
LIABILITIES
Payable for securities purchased 1,098,444
Payable for currency purchased --
Payable for fund shares repurchased --
Distributions payable 1,544,130
Payable for audit fees 4,353
Payable for custody fees 19,754
Payable for organization expense 6,788
Payable to Investment Adviser (Note 3) 37,989
Accounts payable and accrued expenses 5,805
______________
TOTAL LIABILITIES 2,717,263
______________
NET ASSETS $57,301,963
==============
NET ASSETS CONSIST OF:
Paid-in capital (Note 5) $52,847,749
Undistributed net investment income (loss) (Note 2) 5,234
Accumulated net realized gain on investments and
foreign currency transactions 262,444
Net unrealized appreciation (depreciation) of:
Investments 4,186,583
Foreign currency translations (47)
______________
NET ASSETS $57,301,963
==============
</TABLE>
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1996
(Continued)
<TABLE>
<CAPTION>
Total
Return
Portfolio
______________
<S> <C>
NET ASSET VALUE PER SHARE
Offering and redemption price per share (based on shares of
beneficial interest outstanding) $13.15
Total shares outstanding at end of period 4,357,555
(a) Investments in securities and repurchase agreements, at cost $54,686,570
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF OPERATIONS
For the year ended December 31, 1996
<TABLE>
<CAPTION>
OTC Research
Portfolio Portfolio
______________ ____________
<S> <C> <C>
INVESTMENT INCOME
Interest income $135,332 $131,956
Dividend income 31,391 429,782
Foreign taxes withheld (97) (8,648)
______________ ____________
TOTAL INVESTMENT INCOME 166,626 553,090
EXPENSES
Investment adviser fee (Note 3) 185,005 325,527
Administration fee 12,565 12,667
Audit fee 8,085 8,085
Custodian fees and expenses 83,378 165,303
Trustee's fees (Note 3) 5,640 5,640
Legal fee 7,405 7,405
Insurance expense 2,664 2,664
Transfer agent expense 4,644 4,352
Amortization of organization expense 2,470 2,470
Miscellaneous expense 603 603
-------------- ------------
NET EXPENSES 312,459 534,716
______________ ____________
NET INVESTMENT INCOME (LOSS) (145,833) 18,374
NET REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENTS AND FOREIGN CURRENCY
Net realized gain (loss) on:
Investments 2,735,463 2,825,747
Foreign currency transactions (146) 32,712
Change in unrealized appreciation of:
Investments 851,565 5,333,270
Foreign currency translations -- 722
______________ ____________
NET REALIZED AND UNREALIZED GAIN 3,586,882 8,192,451
______________ ____________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $3,441,049 $8,210,825
============== ============
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF OPERATIONS
For the year ended December 31, 1996
<TABLE>
<CAPTION>
Total
Return
Portfolio
______________
<S> <C>
INVESTMENT INCOME
Interest income $996,220
Dividend income 543,980
Foreign taxes withheld (6,221)
______________
TOTAL INVESTMENT INCOME 1,533,979
EXPENSES
Investment adviser fee (Note 3) 270,373
Administration fee 12,564
Audit fee 8,085
Custodian fees and expenses 107,224
Trustee's fees (Note 3) 5,640
Legal fee 7,405
Insurance expense 2,664
Transfer agent expense 4,343
Amortization of organization expense 2,471
Miscellaneous expense 601
______________
NET EXPENSES 421,370
______________
NET INVESTMENT INCOME (LOSS) 1,112,609
NET REALIZED AND UNREALIZED GAIN (LOSS) FROM
INVESTMENTS AND FOREIGN CURRENCY
Net realized gain (loss) on:
Investments 694,215
Foreign currency transactions 4,984
Change in unrealized appreciation of:
Investments 3,063,457
Foreign currency translations 2
______________
NET REALIZED AND UNREALIZED GAIN 3,762,658
______________
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $4,875,267
==============
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
For the years ended December 31, 1995 and 1996
<TABLE>
<CAPTION>
OTC
Portfolio
______________
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS FOR THE YEAR
ENDED DECEMBER 31, 1995:
Net investment income (loss) ($11,987)
Net realized gain (loss) on:
Investments 1,098,964
Foreign currency transactions --
Change in unrealized appreciation (depreciation) of:
Investments 230,952
Foreign currency translations --
______________
Net increase in net assets resulting from operations 1,317,929
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income --
In excess of net investment income --
Distributions in excess of net realized loss on investments (995,427)
FUND SHARE TRANSACTIONS (Note 5) 7,036,435
______________
TOTAL INCREASE IN NET ASSETS 7,358,937
NET ASSETS:
Beginning of period 1,695,685
______________
END OF PERIOD (a) $9,054,622
==============
(a) Including undistributed net investment income $ --
==============
</TABLE>
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
For the years ended December 31, 1995 and 1996
(Continued)
<TABLE>
<CAPTION>
OTC
Portfolio
______________
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS FOR THE PERIOD
ENDED DECEMBER 31, 1996:
Net investment income (loss) ($145,833)
Net realized gain (loss) on:
Investments 2,735,463
Foreign currency transactions (146)
Change in unrealized appreciation of:
Investments 851,565
Foreign currency translations --
______________
Net increase in net assets resulting from operations 3,441,049
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income --
Distributions from net realized gain on investments (2,298,074)
FUND SHARE TRANSACTIONS (Note 5) 33,123,983
______________
TOTAL INCREASE IN NET ASSETS 34,266,958
NET ASSETS:
Beginning of period 9,054,622
______________
END OF PERIOD (a) $43,321,580
==============
(a) Including undistributed net investment income (loss) $ --
==============
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
For the years ended December 31, 1995 and 1996
<TABLE>
<CAPTION>
Research
Portfolio
______________
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS FOR THE YEAR
ENDED DECEMBER 31, 1995:
Net investment income (loss) $40,193
Net realized gain (loss) on:
Investments 352,255
Foreign currency transactions 9,912
Change in unrealized appreciation (depreciation) of:
Investments 1,725,239
Foreign currency translations (197)
______________
Net increase in net assets resulting from operations 2,127,402
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (39,939)
In excess of net investment income --
Distributions in excess of net realized loss on investments (234,536)
FUND SHARE TRANSACTIONS (Note 5) 12,706,354
______________
TOTAL INCREASE IN NET ASSETS 14,559,281
NET ASSETS:
Beginning of period 1,626,521
______________
END OF PERIOD (a) $16,185,802
==============
(a) Including undistributed net investment income $163
==============
</TABLE>
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
For the years ended December 31, 1995 and 1996
(Continued)
<TABLE>
<CAPTION>
Research
Portfolio
______________
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS FOR THE PERIOD
ENDED DECEMBER 31, 1996:
Net investment income (loss) $18,374
Net realized gain (loss) on:
Investments 2,825,747
Foreign currency transactions 32,712
Change in unrealized appreciation of:
Investments 5,333,270
Foreign currency translations 722
______________
Net increase in net assets resulting from operations 8,210,825
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (12,458)
Distributions from net realized gain on investments (2,117,360)
FUND SHARE TRANSACTIONS (Note 5) 52,912,033
______________
TOTAL INCREASE IN NET ASSETS 58,993,040
NET ASSETS:
Beginning of period 16,185,802
______________
END OF PERIOD (a) $75,178,842
==============
(a) Including undistributed net investment income (loss) ($73)
==============
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
For the years ended December 31, 1995 and 1996
<TABLE>
<CAPTION>
Total
Return
Portfolio
______________
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS FOR THE YEAR
ENDED DECEMBER 31, 1995:
Net investment income (loss) $264,737
Net realized gain (loss) on:
Investments 138,883
Foreign currency transactions (1,184)
Change in unrealized appreciation (depreciation) of:
Investments 1,143,979
Foreign currency translations (49)
______________
Net increase in net assets resulting from operations 1,546,366
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (264,737)
In excess of net investment income (1,276)
Distributions in excess of net realized loss on investments (63,682)
FUND SHARE TRANSACTIONS (Note 5) 12,987,871
______________
TOTAL INCREASE IN NET ASSETS 14,204,542
NET ASSETS:
Beginning of period 1,298,365
______________
END OF PERIOD (a) $15,502,907
==============
(a) Including undistributed net investment income $ --
==============
</TABLE>
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
STATEMENTS OF CHANGES IN NET ASSETS
For the years ended December 31, 1995 and 1996
(Continued)
<TABLE>
<CAPTION>
Total
Return
Portfolio
______________
<S> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS FOR THE PERIOD
ENDED DECEMBER 31, 1996:
Net investment income (loss) $1,112,609
Net realized gain (loss) on:
Investments 694,215
Foreign currency transactions 4,984
Change in unrealized appreciation of:
Investments 3,063,457
Foreign currency translations 2
______________
Net increase in net assets resulting from operations 4,875,267
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (1,110,704)
Distributions from net realized gain on investments (500,838)
FUND SHARE TRANSACTIONS (Note 5) 38,535,331
______________
TOTAL INCREASE IN NET ASSETS 41,799,056
NET ASSETS:
Beginning of period 15,502,907
______________
END OF PERIOD (a) $57,301,963
==============
(a) Including undistributed net investment income (loss) $5,234
==============
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period indicated)
<TABLE>
<CAPTION>
Net
Realized
and
Unrealized
Net Asset Net Gain (Loss)
Value at Investment on
Beginning Income Invest-
of Period (Loss) (1) ments
_____________ _____________ _____________
<S> <C> <C> <C>
OTC PORTFOLIO
Year ended December 31, 1996 $12.08 ($0.03) $2.52
Year ended December 31, 1995 10.36 (0.02) 3.07
Period ended December 31, 1994* 10.00 0.00 0.36
RESEARCH PORTFOLIO
Year ended December 31, 1996 12.88 0.00 3.00
Year ended December 31, 1995 9.59 0.03 3.48
Period ended December 31, 1994* 10.00 0.09 (0.41)
TOTAL RETURN PORTFOLIO
Year ended December 31, 1996 11.90 0.26 1.37
Year ended December 31, 1995 9.76 0.21 2.19
Period ended December 31, 1994* 10.00 0.09 (0.24)
<FN>
(1) Net investment income is after reimbursement of certain fees and expenses
by Equitable Investment Services, Inc. ("EISI") (See Note 3 to the finan-
cial statements). Had EISI not undertaken to reimburse expenses related
to the Portfolios, net investment income (loss) per share and ratio of
operating expenses to average net assets would have been as follows for
the year ended December 31, 1996, for the year ended December 31, 1995
and for the period ended December 31, 1994, respectively: OTC Portfolio,
$(0.03) and 1.35%, $(0.10) and 2.52%, $(0.12) and 7.10%; Research
Portfolio, $0.00 and 1.31%, $(0.04) and 2.48%, $(0.04) and 7.48% and Total
Return Portfolio, $0.26 and 1.25%, $0.14 and 2.36%, $(0.06) and 8.31%.
* For the period October 4, 1994 (commencement of investment operations)
through December 31, 1994.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period indicated)
<TABLE>
<CAPTION>
Total Distributions Net
from from Net Capital
Investment Investment Gains
Operations Income Distributions
____________ ____________ _____________
<S> <C> <C> <C>
OTC PORTFOLIO
Year ended December 31, 1996 $2.49 $0.00 ($0.75)
Year ended December 31, 1995 3.05 0.00 (1.33)
Period ended December 31, 1994* 0.36 0.00 0.00
RESEARCH PORTFOLIO
Year ended December 31, 1996 3.00 0.00 (6) (0.45)
Year ended December 31, 1995 3.51 (0.03) (0.19)
Period ended December 31, 1994* (0.32) (0.09) 0.00
TOTAL RETURN PORTFOLIO
Year ended December 31, 1996 1.63 (0.26) (0.12)
Year ended December 31, 1995 2.40 (0.21) (0.05)
Period ended December 31, 1994* (0.15) (0.09) 0.00
<FN>
(6) Amount is less than $0.003 per share.
* For the period October 4, 1994 (commencement of investment operations)
through December 31, 1994.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period indicated)
<TABLE>
<CAPTION>
Net Asset
Value at
Total End Total
Distribution of Period Return (2)
_____________ _____________ _____________
<S> <C> <C> <C>
OTC PORTFOLIO
Year ended December 31, 1996 ($0.75) $13.82 20.68%
Year ended December 31, 1995 (1.33) 12.08 29.23
Period ended December 31, 1994* 0.00 10.36 3.59
RESEARCH PORTFOLIO
Year ended December 31, 1996 (0.45) 15.43 23.37
Year ended December 31, 1995 (0.22) 12.88 36.58
Period ended December 31, 1994* (0.09) 9.59 (3.22)
TOTAL RETURN PORTFOLIO
Year ended December 31, 1996 (0.38) 13.15 13.70
Year ended December 31, 1995 (0.26) 11.90 24.51
Period ended December 31, 1994* (0.09) 9.76 (1.47)
<FN>
(2) Total return figures are not annualized for periods less than one year.
Total return does not reflect expenses that apply to the separate
account or related variable insurance contracts and inclusion of
these charges would result in reducing the total return figures for
the period shown.
* For the period October 4, 1994 (commencement of investment operations)
through December 31, 1994.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period indicated)
<TABLE>
<CAPTION>
Ratio Ratio of Net
of Operating Investment
Net Assets Expenses to Income (Loss)
End Average Net to Average
of Period Assets (1)(3) Net Assets (3)
_____________ _____________ _____________
<S> <C> <C> <C>
OTC PORTFOLIO
Year ended December 31, 1996 $43,321,580 1.35% (0.63)%
Year ended December 31, 1995 9,054,622 1.07 (0.22)
Period ended December 31, 1994* 1,695,685 0.75 0.16
RESEARCH PORTFOLIO
Year ended December 31, 1996 75,178,842 1.31 0.05
Year ended December 31, 1995 16,185,802 1.12 0.58
Period ended December 31, 1994* 1,626,521 0.75 4.65
TOTAL RETURN PORTFOLIO
Year ended December 31, 1996 57,301,963 1.25 3.29
Year ended December 31, 1995 15,502,907 1.11 3.88
Period ended December 31, 1994* 1,298,365 0.75 4.58
<FN>
(1) Net investment income is after reimbursement of certain fees and expenses
by Equitable Investment Services, Inc. ("EISI") (See Note 3 to the finan-
cial statements). Had EISI not undertaken to reimburse expenses related
to the Portfolios, net investment income (loss) per share and ratio of
operating expenses to average net assets would have been as follows for
the year ended December 31, 1996, for the year ended December 31, 1995
and for the period ended December 31, 1994, respectively: OTC Portfolio,
$(0.03) and 1.35%, $(0.10) and 2.52%, $(0.12) and 7.10%; Research
Portfolio, $0.00 and 1.31%, $(0.04) and 2.48%, $(0.04) and 7.48% and Total
Return Portfolio, $0.26 and 1.25%, $0.14 and 2.36%, $(0.06) and 8.31%.
(3) Annualized for periods less than one year.
* For the period October 4, 1994 (commencement of investment operations)
through December 31, 1994.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout the period indicated)
<TABLE>
<CAPTION>
Portfolio Average
Turnover Commission
Rate (4) Rate (5)
_____________ _____________
<S> <C> <C>
OTC PORTFOLIO
Year ended December 31, 1996 122% $.0402
Year ended December 31, 1995 111 --
Period ended December 31, 1994* 6 --
RESEARCH PORTFOLIO
Year ended December 31, 1996 68 .0281
Year ended December 31, 1995 83 --
Period ended December 31, 1994* 85 --
TOTAL RETURN PORTFOLIO
Year ended December 31, 1996 131 .0510
Year ended December 31, 1995 89 --
Period ended December 31, 1994* 45 --
<FN>
(4) Portfolio turnover rates are not annualized.
(5) The average commission rate paid is applicable for Portfolios that
invest greater than 10% of average net assets in equity security
transactions for which commissions are charged. This disclosure is
required for fiscal periods beginning on or after September 1, 1995.
* For the period October 4, 1994 (commencement of investment operations)
through December 31, 1994.
</TABLE>
See accompanying notes.
EQUI-SELECT SERIES TRUST
OTC PORTFOLIO, RESEARCH PORTFOLIO AND TOTAL RETURN PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
December 31, 1996
NOTE 1 - ORGANIZATION
Equi-Select Series Trust (the "Trust") is registered under the Investment
Company Act of 1940, as amended, as a no load, open-end management investment
company. The Trust was organized as a Massachusetts business trust on May
11, 1994, and offers nine portfolios, including the OTC Portfolio, Research
Portfolio and Total Return Portfolio (each "Portfolio" or, collectively,
"Portfolios"). On September 15, 1994, Equitable Life Insurance Company of
Iowa made the initial purchase of shares of beneficial interest in the amount
of 1,000 shares for each of the Portfolios. The shares of the Trust are sold
to certain life insurance companies' separate accounts to fund the benefits
under variable annuity and variable life contracts issued by such life
insurance companies, including Equitable Life Insurance Company of Iowa and
Golden American Life Insurance Company. The Trust began investment
operations on October 4, 1994.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements.
ESTIMATES - The preparation of the financial statements in conformity with
generally accepted accounting principles may require management to make
certain estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of these financial statements and the reported
amounts of income and expenses during the reporting period. Actual results
could differ from those estimates.
VALUATION OF INVESTMENTS - Portfolio securities traded on a national
securities exchange or quoted on the NASDAQ National Market System are valued
at the last reported sale price on the principal exchange or reported by
NASDAQ or, if there is no reported sale, and in the case of over-the-counter
securities not included on NASDAQ, at a bid price. Debt securities,
including zero-coupon securities, and certain foreign securities are valued
by a pricing service. Securities for which current market quotations are not
readily available are valued at fair value as determined in good faith by the
Trustees, or by an individual acting under the direction of the Trustees.
Prices for securities primarily traded in foreign markets are expressed in
the local currency's value and are translated into U.S. dollars at the
current rate of exchange. Short-Term securities, including all debt
securities with a remaining maturity of 60 days or less, are valued at their
amortized cost, which approximates market value.
REPURCHASE AGREEMENTS - In connection with transactions in repurchase
agreements, the Trust's custodian takes possession of the underlying
collateral securities, the value of which is at least equal to the principal
amount, including interest, of the repurchase agreement. To the extent that
the term of any repurchase agreement exceeds one business day, the value of
the collateral is marked-to-market on a daily basis to ensure the adequacy of
the collateral. In the event of default of the obligation to repurchase, the
Trust has the right to liquidate the collateral and apply the proceeds in
satisfaction of the obligation. Under certain circumstances, in the event of
default or bankruptcy by the other party to the agreement, realization and/or
retention of the collateral or proceeds may be subject to legal proceedings.
NOTE 2 (CONTINUED)
INVESTMENT TRANSACTIONS - Investment security transactions are recorded on a
trade date basis. Realized gains and losses from security transactions are
determined on the basis of identified cost.
INVESTMENT INCOME - Dividend income is recorded on the ex-dividend date,
except certain dividends from foreign securities where the ex-dividend date
may have passed are recorded as income when the Trust identifies the
dividend. Interest income, which includes accretion of original discount, is
accrued as earned. Investment income is recorded net of foreign taxes
withheld where recovery of such taxes is uncertain.
FOREIGN CURRENCY TRANSLATIONS - The records of the Trust are maintained in
U.S. dollars. Foreign currency amounts are translated into U.S. dollars at a
current rate of exchange of such currency to determine the value of
investments, other assets and liabilities. Purchases and sales of securities
and income and expenses are converted at the prevailing rate of exchange on
the respective dates of such transactions.
A Portfolio may realize currency gains or losses between the trade and
settlement dates on security transactions. To minimize such currency gains
or losses, the Portfolio may enter into a foreign currency exchange contract
for the purchase or sale, for a fixed amount of U.S. dollars, of an amount of
the foreign currency required to settle the security transaction.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by a Portfolio on each day and the resulting net unrealized
appreciation, depreciation and related net receivable or payable amounts are
determined by using forward currency exchange rates supplied by a quotation
service.
Reported net realized gains and losses on foreign currency transactions
represent net gains and losses from sales and maturities of forward currency
contracts, disposition of foreign currencies, currency gains and losses
realized between the trade and settlement dates on security transactions, and
the difference between the amount of net investment income accrued and the
U.S. dollar amount actually received.
FORWARD CURRENCY CONTRACTS - A forward foreign currency contract ("Forward")
is an agreement between two parties to buy and sell a currency at a set price
on a future date. The market value of the Forward fluctuates with changes in
currency exchange rates. The Forward is marked-to-market daily and the
change in the market value is recorded by a Portfolio as an unrealized gain
or loss. When the Forward is closed, the Portfolio records a realized gain
or loss equal to the difference between the value at the time it was opened
and the value at the time it was closed. The Portfolio could be exposed to
risk if a counterparty is unable to meet the terms of the contract or if the
value of the currency changes unfavorably. The Portfolio may enter into
Forwards in connection with planned purchases and sales of securities, to
hedge specific receivables or payables against changes in future exchange
rates or to hedge the U.S. dollar value of portfolio securities denominated
in a foreign currency.
NOTE 2 (CONTINUED)
CURRENCY CALL AND PUT OPTIONS - A call option written by a Portfolio
obligates the Portfolio to sell specified currency to the option holder at a
specified price at any time before the expiration date. A put option written
by a Portfolio obligates the Portfolio to purchase specified currency from
the option holder at a specified price at any time before the expiration
date. These transactions involve a risk that a Portfolio may, upon exercise
of the option, be required to sell currency at a price that is less than its
market value or be required to purchase currency at a price that exceeds its
market value. A Portfolio may also realize gains or losses by entering into
closing purchase transactions identical to call or put options that have been
written by the Portfolio in order to terminate its obligation under a call or
put option. In determining the amount of gain or loss realized, the option
premium paid and related transactions costs are added to the exercise price.
DOLLAR ROLL TRANSACTIONS - A Portfolio may enter into dollar roll
transactions, in which a Portfolio sells securities for delivery in the
current month and simultaneously contracts to repurchase substantially
similar (same type, same or similar interest rate and maturity) securities on
a specified future date. During the roll period the Portfolio forgoes
principal and interest paid on the securities. The Portfolios account for
such dollar rolls as financing transactions, and are compensated by the
interest earned on the cash proceeds of the initial sale and by the lower
repurchase price at the future date. To the extent that a Portfolio has
commitments under dollar roll transactions, liquid, high grade debt
securities are segregated in an amount equivalent to these obligations.
There were no dollar roll commitments outstanding at December 31, 1996.
EXPENSES - Expenses directly attributable to a Portfolio are charged to that
Portfolio. Expenses not directly attributable to a Portfolio are allocated
among the Trust's Portfolios, including the OTC Portfolio, Research Portfolio
and the Total Return Portfolio. Certain costs incurred in connection with
the organization of the Trust and each Portfolio have been deferred and are
being amortized on a straight line basis over a five year period.
DISTRIBUTIONS TO SHAREHOLDERS - Each of the Portfolios declares and
distributes dividends from net investment income and distributes its net
realized capital gains, if any, at least annually. All distributions are
paid in shares of the relevant Portfolio at net asset value. Income and
capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for market
discount, foreign currency transactions, losses deferred due to wash sales,
"post October 31 losses" and excise tax regulations. Distributions are
recorded on the ex-dividend date.
FEDERAL INCOME TAXES - Each Portfolio is treated as a separate entity for
federal tax purposes. Each Portfolio intends to qualify each year as a
regulated investment company under Subchapter M of the Internal Revenue Code
of 1986. By so qualifying, the Portfolios will not be subject to federal
income taxes 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, capital gains
and certain other amounts during the calendar year, the Portfolios will not
be subject to a federal excise tax. As of December 31, 1996, the Portfolios
elected for Federal income tax purposes to defer certain current year post
October 31 losses as though the losses were incurred on the first day of the
next calendar year as follows: OTC, $62,692; Research, $73 and Total Return,
$354. During the fiscal year ended December 31, 1996, the Research and Total
Return Portfolios declared a capital gain distribution of $385,575 and $0.082
NOTE 2 (CONTINUED)
per share and $271,218 and $0.063 per share, respectively.
On the Statement of Assets and Liabilities, as a result of permanent book-to-
tax differences, reclassification adjustments have been made between the paid
in capital, undistributed net investment income, and accumulated net realized
gain (loss) on investments and foreign currency translations accounts. These
reclassification adjustments have no impact on the net asset values of the
Portfolios.
NOTE 3 - AGREEMENTS AND FEES
The Trust has entered into an Investment Advisory Agreement (the "Agreement")
with Equitable Investment Services, Inc. ("EISI"), under which EISI manages
the business and affairs of the Portfolios and the Trust. Under the
Agreement, each Portfolio pays EISI a monthly advisory fee at the annual rate
based on the average daily net assets of each Portfolio of .80% of the first
$300 million and .55% in excess of $300 million.
EISI has entered into a Sub-Advisory Agreement with Massachusetts Financial
Services Company (MFS) with respect to the Portfolios. MFS, under the
supervision of EISI, is responsible for the day-to-day investment management
of the Portfolios. The fees payable to MFS under the Sub-Advisory Agreement
are borne by EISI, and the Portfolios do not bear the direct cost of the sub-
advisory activities.
EISI has agreed to reimburse each Portfolio for all expenses (excluding the
advisory fee) that exceed .75% of the average daily net assets of the
Portfolios. This undertaking is subject to termination at any time without
notice to shareholders. For the year ended December 31, 1996, no
reimbursements were made to the Portfolio's for expenses in excess of the
voluntary expense limitations.
Each Trustee of the Trust who is not an interested person of the Trust or
Adviser or Sub-Adviser receives an annual fee of $6,000 and an additional fee
of $1,500 for each Trustees' meeting attended.
NOTE 4 - INVESTMENT TRANSACTIONS
Purchases and proceeds from sales and maturities of investments, excluding
all short-term securities for the Portfolios, for the year ended December 31,
1996 were as follows:
<TABLE>
<CAPTION>
Non-U.S. U.S. Non-U.S. U.S.
Government Government Government Government
Purchases Purchases Sales Sales
____________ ____________ ____________ _____________
<S> <C> <C> <C> <C>
OTC $58,247,542 $ -- $26,224,375 $ --
Research 76,993,927 249,880 26,539,938 373,616
Total Return 46,524,170 30,625,168 17,488,929 22,228,077
</TABLE>
The identified cost of investments in securities and repurchase agreements
owned by the Portfolios for federal income tax purposes and their respective
gross unrealized appreciation and depreciation at December 31, 1996 were as
follows:
<TABLE>
<CAPTION>
Gross Gross Net
Identified Unrealized Unrealized Unrealized
Cost Appreciation Depreciation Appreciation
____________ ____________ ____________ _____________
<S> <C> <C> <C> <C>
OTC $45,126,700 $3,406,786 $2,486,662 $920,124
Research 73,696,228 8,355,916 1,367,888 6,988,028
Total Return 54,693,022 4,535,397 355,266 4,180,131
</TABLE>
NOTE 5 - SHAREHOLDER TRANSACTIONS:
Transactions in shares and dollars were as follows:
<TABLE>
<CAPTION>
OTC Portfolio
Year Ended Year Ended
December 31, 1996 December 31, 1995
_________________________ _________________________
Shares Dollars Shares Dollars
____________ ____________ ____________ ____________
<S> <C> <C> <C> <C>
Shares sold 2,338,803 $32,591,217 717,249 $8,736,295
Shares issued to share-
holders in reinvestment
of dividends 87,570 1,086,357 50 509
Shares redeemed (41,713) (553,591) (131,491) (1,700,369)
____________ ____________ ____________ ____________
Net increase 2,384,660 $33,123,983 585,808 $7,036,435
============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
Research Portfolio
Year Ended Year Ended
December 31, 1996 December 31, 1995
_________________________ _________________________
Shares Dollars Shares Dollars
____________ ____________ ____________ ____________
<S> <C> <C> <C> <C>
Shares sold 3,696,388 $54,264,879 1,204,516 $14,162,794
Shares issued to share-
holders in reinvestment
of dividends 29,426 392,354 1,537 14,626
Shares redeemed (110,466) (1,745,200) (118,854) (1,471,066)
____________ ____________ ____________ ____________
Net increase 3,615,348 $52,912,033 1,087,199 $12,706,354
============ ============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
Total Return Portfolio
Year Ended Year Ended
December 31, 1996 December 31, 1995
_________________________ _________________________
Shares Dollars Shares Dollars
____________ ____________ ____________ ____________
<S> <C> <C> <C> <C>
Shares sold 3,064,004 $38,670,842 1,280,732 $14,234,048
Shares issued to share-
holders in reinvestment
of dividends 33,017 397,108 1,222 11,922
Shares redeemed (41,981) (532,619) (112,428) (1,258,099)
____________ ____________ ____________ ____________
Net increase 3,055,040 $38,535,331 1,169,526 $12,987,871
============ ============ ============ ============
</TABLE>
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EQUI-SELECT SERIES TRUST
____________________
TRUSTEES AND EXECUTIVE OFFICERS
Paul R. Schlaack, Trustee, Principal Executive Officer and President*
J. Michael Earley, Trustee
R. Barbara Gitenstein, Trustee
Stanley B. Seidler, Trustee
Paul E. Larson, Treasurer and Principal Financial Officer
John A. Merriman, Secretary
David A. Terwilliger, Principal Accounting Officer
Kimberly K. Krumviede, Vice President
* Interested Trustee
____________________
Ernst & Young LLP, Independent Auditors
Blazzard, Grodd & Hasenauer, P.C., Legal Counsel
Equitable Investment Services, Inc., Investment Adviser
The information contained in this report is intended for general
informational purposes only. This report is not authorized for
distribution to prospective investors unless preceded or accompanied by
current Trust and Separate Account prospectuses which contain important
information concerning the Trust, the Company, and its current public
offering of variable annuity contracts.
The PrimElite Variable Annuity is distributed by Equitable of Iowa Securities
Network, Inc., an affiliate of Equitable Life Insurance Company of Iowa.
EQUITABLE LIFE OF IOWA
P.O. BOX 9271, DES MOINES, IA 50306-9271
EQUITABLE LIFE Bulk Rate
INSURANCE COMPANY U.S. Postage
OF IOWA PAID
Des Moines, IA
P.O.BOX 9271 Permit No. 3361
DES MOINES, IA 50306-9271
