[front cover]
MAY 31, 2000
AMERICAN CENTURY(reg.sm)
SEMIANNUAL REPORT
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Strategic Allocation:
Conservative
Moderate
Aggressive
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American
Century
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[left margin]
STRATEGIC ALLOCATION: CONSERVATIVE
(TWSCX)
------------------------------------
STRATEGIC ALLOCATION: MODERATE
(TWSMX)
------------------------------------
STRATEGIC ALLOCATION: AGGRESSIVE
(TWSAX)
------------------------------------
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Our Message to You
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[photo of James E. Stowers III, seated, with James E. Stowers, Jr.]
James E. Stowers III, seated, with James E. Stowers, Jr.
The six months ended May 31, 2000, served as yet another reminder of the
importance of a diversified investment portfolio.
Concerns about inflation, rising interest rates, and the high valuations of
so-called "New Economy" technology stocks in the U.S. caused a major shift in
investor sentiment. Global stock markets grew increasingly volatile-- for
example, the tech-heavy Nasdaq Composite Index lost more than 25% in a single
week in early April. The volatility rippled through the equity markets and left
few stocks unscathed.
Bonds benefited a little from the equity market volatility, but rising
interest rates put pressure on bond prices. In the U.S., the federal government
began using the budget surplus to buy back its own debt, which helped support
Treasury bond prices.
In this unusual environment, the Strategic Asset Allocation funds'
portfolios of both stocks and bonds held up well, outperforming the S&P 500
stock index. Our investment professionals review the period and the funds'
performance in more detail beginning on page 3.
We're proud to announce that American Century's fund performance reports,
like this one, earned the Communications Seal from DALBAR, Inc., an independent
financial services research firm. DALBAR commended us for meeting investors'
needs with an attractive document that's easy to read and understand.
We're also pleased to provide investors with two new investment tools. Fund
Advisor,(1) an online advice engine, is designed to give impartial guidance in
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invest tax-deferred to meet higher education costs. The summer issue of the
American Century investor newsletter provides more details on these tools.
As always, we appreciate your continued confidence in American Century.
Sincerely,
/s/James E. Stowers, Jr. /s/James E. Stowers III
James E. Stowers, Jr. James E. Stowers III
Chairman of the Board and Founder Vice Chairman of the Board and
Chief Executive Officer
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for recommending any fund, although it may receive management, service, or
other fees from funds recommended through Fund Advisor. These arrangements
are described in Acumation Inc.'s Form ADV Part II.
[right margin]
Table of Contents
Report Highlights ...................................................... 2
Market Perspective ..................................................... 3
STRATEGIC ALLOCATION: CONSERVATIVE
Performance Information ................................................ 5
Management Q&A ......................................................... 6
Schedule of Investments ................................................ 9
STRATEGIC ALLOCATION: MODERATE
Performance Information ................................................ 18
Management Q&A ......................................................... 19
Schedule of Investments ................................................ 22
STRATEGIC ALLOCATION: AGGRESSIVE
Performance Information ................................................ 34
Management Q&A ......................................................... 35
Schedule of Investments ................................................ 38
FINANCIAL STATEMENTS
Statements of Assets and
Liabilities ......................................................... 49
Statements of Operations ............................................... 50
Statements of Changes
in Net Assets ....................................................... 51
Notes to Financial
Statements .......................................................... 52
Financial Highlights ................................................... 56
OTHER INFORMATION
Share Class and Retirement
Account Information ................................................. 62
Background Information
Investment Philosophy
and Policies ..................................................... 63
Comparative Indices ................................................. 63
Investment Team
Leaders .......................................................... 63
Neutral Asset Mixes ................................................. 63
Glossary ............................................................... 64
www.americancentury.com 1
Report Highlights
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MARKET PERSPECTIVE
* During the six months ended May 31, 2000, U.S. stock prices generally moved
higher, led by small- and mid-cap shares, but the market experienced
frequent and severe bouts of volatility.
* Foreign stock market performance was similar to that in the U.S., but
currency fluctuations--especially a stronger U.S. dollar--also had an impact
on returns.
* Strong economic growth and inflation fears continued to put pressure on
domestic bonds, although Treasury bonds benefited from reduced supply.
STRATEGIC ALLOCATION: CONSERVATIVE
* The fund outperformed both the S&P 500 and the Lehman Aggregate Bond Index
during the six months ended May 31.
* In Strategic Conservative's bond portfolio, we added to its Treasury bond
holdings, reduced its corporate bond holdings, and eliminated the strategic
weighting in foreign bonds.
* In the fund's stock portfolio, we overweighted small- and mid-cap stocks
early in the period, shifted some foreign assets from Japan to Europe, and
brought our overall stock allocation back to a neutral position by the end
of May.
* Going forward, we expect to maintain Strategic Conservative's current
positioning, although we're beginning to reduce the portfolio's cash
position and move back to an overweight in U.S. stocks.
STRATEGIC ALLOCATION: MODERATE
* The fund comfortably outperformed the S&P 500 during the six months ended
May 31.
* In the fund's stock portfolio, we overweighted small- and mid-cap stocks
early in the period, shifted some foreign assets from Japan to Europe, and
brought our stock allocation back to a neutral position by the end of May.
* In Strategic Moderate's bond portfolio, we added to its Treasury bond
holdings, reduced its corporate bond holdings, and eliminated the strategic
weighting in foreign bonds.
* Going forward, we expect to maintain Strategic Moderate's current
positioning, although we're beginning to reduce the portfolio's cash
position and move back to an overweight in U.S. stocks.
STRATEGIC ALLOCATION: AGGRESSIVE
* The fund outperformed the S&P 500 by a wide margin during the six months
ended May 31.
* Strategic Aggressive had a heavy overweight in small- and mid-cap stocks
early in the period, then brought it back to a neutral position by the end
of the period.
* In the fund's foreign stock portfolio, we shifted some assets from Japan to
Europe.
* In Strategic Aggressive's bond portfolio, we added to its Treasury bond
holdings, reduced its corporate bond holdings, and eliminated the strategic
weighting in foreign bonds.
* Going forward, we expect to maintain the fund's current positioning,
although we're beginning to reduce the portfolio's cash position and move
back to an overweight in U.S. stocks.
[left margin]
CONSERVATIVE(1)
(TWSCX)
TOTAL RETURNS: AS OF 5/31/00
6 Months 4.17%(2)
1 Year 8.88%
INCEPTION DATE: 2/15/96
NET ASSETS: $180.1 million(3)
MODERATE(1)
(TWSMX)
TOTAL RETURNS: AS OF 5/31/00
6 Months 7.71%(2)
1 Year 18.70%
INCEPTION DATE: 2/15/96
NET ASSETS: $449.5 million(3)
AGGRESSIVE(1)
(TWSAX)
TOTAL RETURNS: AS OF 5/31/00
6 Months 10.87%(2)
1 Year 29.16%
INCEPTION DATE: 2/15/96
NET ASSETS: $283.0 million(3)
(1) Investor Class.
(2) Not annualized.
(3) Includes Investor and Advisor classes.
See Total Returns on pages 5, 18, and 34.
Investment terms are defined in the Glossary on pages 64-65.
2 1-800-345-2021
Market Perspective from Jeff Tyler
--------------------------------------------------------------------------------
[photo of Jeff Tyler]
Jeff Tyler, senior vice president and lead manager of the Strategic Asset
Allocation funds
EXTRAORDINARY TIMES
Several themes emerged in the global financial markets during the six
months ended May 31, 2000. U.S. stock prices generally moved higher but
experienced frequent and severe bouts of volatility. The story was similar in
overseas equity markets, but foreign currency weakness relative to the U.S.
dollar also played a key role.
In the U.S. bond market, several interest rate hikes by the Federal Reserve
and an unprecedented buy-back of Treasury bonds by the federal government led to
unusual performance disparities.
U.S. STOCKS
The domestic stock market ended 1999 with a furious rally. As investors
grew more confident about the U.S. economy, the major stock indexes surged and
finished the year at record highs.
Technology and telecommunications stocks--also known as "New Economy"
companies--led the late-year rally and continued to soar in early 2000.
Investors discarded "Old Economy" stocks (such as industrial, consumer, and home
products companies) and snapped up shares of dot-coms and other tech- oriented
firms.
This behavior pushed the Nasdaq Composite Index, which is dominated by tech
stocks, up by more than 50% from November 30, 1999, to its peak on March 10,
2000. In contrast, the S&P 500 gained less than 1% over the same time period.
But the speculative fervor surrounding New Economy stocks contributed to
greater market volatility. Day-to-day swings of 2% or more in the major stock
indexes became increasingly common as investors scurried from dot-com to
dot-com, trying to latch on to the next Yahoo! or Amazon.
By March, disillusionment brought a sudden shift in market sentiment.
Concerns about sustainability and profitability in the tech sector, as well as
the potential impact of several interest rate hikes by the Federal Reserve, led
many investors to move into undervalued sectors of the market or sit on the
sidelines entirely. Between mid-March and late May, the Nasdaq fell by nearly
33%, including a record 25% plunge in the second week of April, while the S&P
500 actually rose by almost 2%.
Despite the dramatic ups and downs, small- and mid-cap stocks performed the
best during the six-month period. Aggressive investors in particular were drawn
to mid-cap stocks because they had the high-growth potential of smaller
companies and the ease of trading associated with larger stocks.
FOREIGN STOCKS
Broadly speaking, equity performance overseas was comparable to that of
domestic stocks, but volatility also took its toll on many foreign markets. In
addition, the strength of the U.S. dollar weakened foreign stock returns for
U.S. investors.
[right margin]
"THE SPECULATIVE FERVOR SURROUNDING NEW ECONOMY STOCKS CONTRIBUTED TO GREATER
MARKET VOLATILITY--DAY-TO-DAY SWINGS OF 2% OR MORE IN THE MAJOR STOCK INDEXES
BECAME INCREASINGLY COMMON."
U.S. STOCK MARKET PERFORMANCE
FOR THE SIX MONTHS ENDED MAY 31, 2000
S&P 500 2.88%
S&P MIDCAP 400 13.78%
S&P SMALLCAP 600 9.18%
FOREIGN STOCK MARKET
PERFORMANCE (IN U.S. DOLLARS)
FOR THE SIX MONTHS ENDED MAY 31, 2000
MORGAN STANLEY EAFE(reg.tm) INDEX 0.61%
Morgan Stanley Europe Index 4.61%
Morgan Stanley Far East Index -7.00%
Morgan Stanley Emerging
Markets Latin American Index 3.80%
MORGAN STANLEY EAFE(reg.tm) INDEX
(IN LOCAL CURRENCIES) 7.83%
Source: Bloomberg Financial Markets and Lipper Inc.
Indices are defined on page 63.
www.americancentury.com 3
Market Perspective from Jeff Tyler
--------------------------------------------------------------------------------
(Continued)
European stock markets were the best performers--many of the major market
indexes were up more than 10% (in local currencies), boosted by technology
stocks and further progress toward privatization. However, interest rate hikes
by the European Central Bank caused concern about economic growth in the region,
and the resulting anxiety led to heightened stock market volatility.
In addition, the euro currency continued its slide against the dollar.
Relatively high interest rates in the U.S. and slow acceptance of the new
currency in international markets caused the euro to fall nearly 8% versus the
dollar during the six-month period. The euro has fallen 20% against the dollar
since its introduction at the beginning of 1999.
In Japan, the economy suffered a setback after showing signs of a rebound
last year. Discouraged investors pushed the Japanese stock market down 15%, and
Japan's currency fell 5% against the dollar.
Stock markets in the rest of Southeast Asia also struggled in early 2000
after a spectacular 1999. The one exception was Taiwan, which got a boost from
its booming semiconductor industry.
Other emerging markets, such as Latin America and Eastern Europe, posted
mixed but generally solid returns. In particular, Russia's stock market soared
as economic conditions improved, the country's currency stabilized, and a new
government that is committed to free market policies was elected.
U.S. BONDS
Strong economic growth and inflation fears continued to put pressure on
domestic bonds. The U.S. economy grew at an annual rate of more than 7% in the
fourth quarter of 1999--the strongest quarter in nearly 16 years--and growth in
the first quarter of 2000 was also healthy.
On top of that, inflation increased to a 3.4% annual rate during the
six-month period, primarily because of soaring oil prices. In response, the
Federal Reserve raised short-term interest rates three times in 2000, on the
heels of three other rate hikes in the last half of 1999.
Rising interest rates usually mean lower bond prices, but that wasn't the
case for longer-term Treasury bonds. The federal budget surplus motivated the
U.S. Treasury to reduce the public debt by cutting back new issuance and buying
back some of its own bonds, mainly those with longer maturities.
This supply reduction caused long-term Treasury yields to fall, while
short-term yields rose along with the Fed's rate increases. As a result,
Treasury yields "inverted," with the yield of the 30-year bond falling below the
yield of the two-year note for the first time since 1990.
The non-Treasury bond sectors--including corporate, government agency, and
mortgage-backed securities--did not fare as well. As the Treasury reduced its
issuance, corporations and government agencies stepped in to fill the void. The
glut of new issuance, along with sharply reduced demand, led to weak returns
among corporate and government agency bonds.
Mortgage-backed securities held up better. These bonds tend to be less
sensitive to interest rate changes, and higher mortgage rates led to reduced
refinancing activity.
[left margin]
"TREASURY BOND YIELDS 'INVERTED,' WITH THE YIELD OF THE 30-YEAR BOND FALLING
BELOW THE YIELD OF THE TWO-YEAR NOTE FOR THE FIRST TIME SINCE 1990."
U.S. BOND MARKET PERFORMANCE
FOR THE SIX MONTHS ENDED MAY 31, 2000
LEHMAN AGGREGATE BOND INDEX 1.38%
Lehman Treasury Bond Index 2.93%
Lehman Corporate Bond Index -0.37%
Lehman Mortgage-Backed
Securities Index 1.25%
Source: Bloomberg Financial Markets and Lipper Inc.
Indices are defined on page 63.
4 1-800-345-2021
<TABLE>
<CAPTION>
Strategic Conservative--Performance
--------------------------------------------------------------------------------
TOTAL RETURNS AS OF MAY 31, 2000
INVESTOR CLASS (INCEPTION 2/15/96) ADVISOR CLASS (INCEPTION 10/2/96)
LEHMAN LEHMAN
STRATEGIC AGGREGATE 3-MONTH U.S. STRATEGIC AGGREGATE 3-MONTH U.S.
CONSERVATIVE S&P 500 BOND INDEX T-BILL INDEX CONSERVATIVE S&P 500 BOND INDEX T-BILL INDEX
========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6 MONTHS(1) 4.17% 2.88% 1.38% 2.80% 4.05% 2.88% 1.38% 2.80%
1 YEAR 8.88% 10.48% 2.11% 5.26% 8.83% 10.48% 2.11% 5.26%
========================================================================================================================
AVERAGE ANNUAL RETURNS
3 YEARS 10.11% 20.45% 5.73% 5.01% 9.85% 20.45% 5.73% 5.01%
LIFE OF FUND 9.35% 22.59%(2) 5.62%(2) 5.05%(2) 9.78% 23.76%(3) 6.05%(3) 5.04%(3)
</TABLE>
(1) Returns for periods less than one year are not annualized.
(2) Since 2/29/96, the date nearest the class's inception for which data
are available.
(3) Since 9/30/96, the date nearest the class's inception for which data
are available.
See pages 62-64 for more information about share classes, returns, and the
comparative indices.
[mountain graph - data below]
GROWTH OF $10,000 OVER LIFE OF FUND
Value on 5/31/00
S&P 500 $23,764
Strategic Conservative $14,848
Lehman Aggregate $12,615
3-Month T-Bill $12,337
Strategic Lehman 3-Month
Conservative S&P 500 Aggregate T-Bill
DATE VALUE VALUE VALUE VALUE
2/29/1996 $10,000 $10,000 $10,000 $10,000
3/31/1996 $10,040 $10,096 $9,930 $10,041
6/30/1996 $10,221 $10,549 $9,987 $10,168
9/30/1996 $10,440 $10,875 $10,171 $10,298
12/31/1996 $10,772 $11,781 $10,476 $10,426
3/31/1997 $10,636 $12,097 $10,418 $10,560
6/30/1997 $11,385 $14,210 $10,800 $10,694
9/30/1997 $12,053 $15,273 $11,159 $10,830
12/31/1997 $12,156 $15,712 $11,487 $10,969
3/31/1998 $12,874 $17,903 $11,666 $11,109
6/30/1998 $13,033 $18,494 $11,939 $11,248
9/30/1998 $12,649 $16,654 $12,444 $11,384
12/31/1998 $13,437 $20,201 $12,486 $11,506
3/31/1999 $13,367 $21,209 $12,424 $11,633
6/30/1999 $13,872 $22,707 $12,315 $11,764
9/30/1999 $13,653 $21,287 $12,398 $11,901
12/31/1999 $14,936 $24,455 $12,383 $12,052
3/31/2000 $15,374 $25,015 $12,657 $12,220
5/31/2000 $14,848 $23,764 $12,615 $12,337
$10,000 investment made 2/29/96
The graph at left shows the growth of a $10,000 investment over the life of the
fund, while the graph below shows the fund's year-by-year performance. The S&P
500, Lehman Aggregate Bond, and Three-Month U.S. Treasury Bill (T-Bill) indices
are provided for comparison in each graph. Strategic Conservative's total
returns include operating expenses (such as transaction costs and management
fees) that reduce returns, while the total returns of the indices do not. The
graphs are based on Investor Class shares only; performance for other classes
will vary due to differences in fee structures (see the Total Returns table
above). Past performance does not guarantee future results. Investment return
and principal value will fluctuate, and redemption value may be more or less
than original cost.
[bar graph - data below]
ONE-YEAR RETURNS OVER LIFE OF FUND (PERIODS ENDED MAY 31)
Strategic Lehman 3-Month
Conservative S&P 500 Aggregate T-Bill
DATE RETURN RETURN RETURN RETURN
5/31/96* 1.86% 5.04% -1.45% 1.25%
5/31/97 9.16% 29.48% 8.32% 5.17%
5/31/98 15.99% 30.68% 10.91% 5.16%
5/31/99 5.74% 21.04% 4.35% 4.62%
5/31/00 8.88% 10.48% 2.11% 5.26%
* From 2/29/96 (the date nearest the class's inception for which index data are
available) to 5/31/96.
www.americancentury.com 5
Strategic Conservative--Q&A
--------------------------------------------------------------------------------
[photo of Jeff Tyler] [photo of Brian Howell]
An interview with Jeff Tyler and Brian Howell, portfolio managers on the
American Century Strategic Asset Allocation funds management team.
HOW DID STRATEGIC CONSERVATIVE PERFORM DURING THE SIX MONTHS ENDED MAY 31, 2000?
The fund produced a solid return given its conservative orientation. For
the six-month period, Strategic Conservative posted a total return of 4.17%.*
(See the previous page for other fund performance information.)
THE FUND OUTPERFORMED BOTH THE S&P 500 AND THE LEHMAN AGGREGATE BOND INDEX (AS
SHOWN ON THE PREVIOUS PAGE). HOW DID THAT HAPPEN?
In part, we made some good asset allocation decisions. We usually make
modest adjustments to Strategic Conservative's neutral asset mix of 45% bonds,
40% stocks, and 15% cash. During the first half of the period, we were
overweight stocks and underweight cash, which proved to be good for fund
performance.
We also made some timely decisions within our stock and bond holdings that
enhanced the fund's return.
LET'S START WITH BONDS. WHAT CHANGES DID YOU MAKE TO THIS PART OF THE PORTFOLIO?
We did some rebalancing during the past six months to bring the bond
portion more in line with the sector weightings of the Lehman Aggregate Bond
Index. That meant cutting back a little on our corporate bond holdings and
adding more Treasury and government agency securities.
As it turns out, Treasury bonds performed very well during the period while
corporate bonds struggled. Nonetheless, we still maintained a slight overweight
in corporate bonds relative to the index, and that held us back a little.
WHY WERE YOU OVERWEIGHT IN CORPORATES?
We thought that corporate bonds were more attractive than Treasury bonds.
Corporate bonds typically have higher yields than Treasurys, and by the
beginning of 2000 this yield advantage had grown to historically wide levels.
In addition, the economy's continued strength was good news for corporate credit
quality.
However, the Treasury Department's issuance reductions and bond buy-backs
changed the dynamics of the market. When the Federal Reserve raises interest
rates--as it did three times during the past six months--bond yields usually
follow suit. But the reduced supply of Treasury bonds caused their yields to
fall at a time when they would ordinarily be rising.
So, contrary to expectations, Treasury bond yields went down, producing
price gains, while the rest of the bond market experienced rising yields and
lower prices.
[left margin]
"DURING THE FIRST HALF OF THE PERIOD, WE WERE OVERWEIGHT STOCKS AND
UNDERWEIGHT CASH, WHICH PROVED TO BE GOOD FOR FUND PERFORMANCE."
[pie chart - data below]
ASSET ALLOCATION
% OF FUND INVESTMENTS
AS OF MAY 31, 2000
U.S. BONDS 48%
U.S. STOCKS 33%
MONEY MARKET SECURITIES 10%
FOREIGN STOCKS 9%
See page 63 for the fund's neutral asset mix.
Investment terms are defined in the Glossary on pages 64-65.
* All fund returns referenced in this interview are for Investor Class shares.
6 1-800-345-2021
Strategic Conservative--Q&A
--------------------------------------------------------------------------------
(Continued)
DID YOU MAKE ANY OTHER ADJUSTMENTS TO STRATEGIC CONSERVATIVE'S BOND PORTFOLIO?
We extended the duration (a measure of price volatility as interest rates
change) of our Treasury holdings to take greater advantage of their price gains.
To keep our overall duration in line with that of the Lehman index, we shortened
the duration of our other holdings.
We also adopted a slightly more conservative position by reducing our
holdings of lower-rated corporate bonds. With the Fed raising interest rates to
slow the economy, we preferred to own high-quality bonds issued by stable,
well-known companies.
THE FUND NO LONGER OWNS ANY FOREIGN BONDS. WHY THE CHANGE?
As of the first of the year, we eliminated the fund's strategic weighting
in foreign bonds, which was typically around 5% of the portfolio. We found that
this slice of the portfolio increased the fund's overall risk level without a
measurable increase in performance. In other words, all it was giving us was
extra volatility, and that's the opposite of what a diversified fund like
Strategic Conservative is all about.
We may still invest in foreign bonds from time to time when we see
attractive opportunities, but it would likely be a very small part of the
portfolio.
LET'S SHIFT TO STRATEGIC CONSERVATIVE'S STOCK PORTFOLIO. HOW WAS IT POSITIONED?
We began the period with a heavy overweight in small- and mid-cap U.S.
stocks. We've started to look at the small- and mid-cap sectors as a single
entity, and we felt that the best investment opportunities were in this part of
the market. This was one of the reasons the fund performed so well--small- and
mid-cap stocks outperformed large-caps by a pretty wide margin during the
period (see the table on page 3).
But, as we mentioned in our annual report six months ago, we were
considering cutting back on our equity overweight after Y2K, and that's exactly
what we did. We began to gradually pare back our stock holdings in early 2000,
and by the end of the period we had brought the domestic stock portfolio back to
a neutral position.
WHAT ABOUT THE FUND'S FOREIGN STOCK HOLDINGS?
The changes we made followed the same pattern as for the domestic stock
portion. We were heavily overweight in foreign stocks coming into 2000, but then
we pared back to a more neutral position over the last few months.
In addition, we reduced our Japanese stock holdings and shifted some of
those assets back into Europe. Many of our Japanese stocks performed very well
in 1999, and we felt it prudent to trim our holdings, especially with the
economic pendulum swinging back toward weakness in early 2000.
LOOKING AHEAD, WHAT ARE YOUR PLANS FOR STRATEGIC CONSERVATIVE'S ASSET ALLOCATION
STRUCTURE?
As usual, we'll keep it close to the neutral asset mix of 45% bonds, 40%
stocks, and 15% cash to stay true to the fund's long-term investment goals.
Since the end of the period, however, we've been reducing the portfolio's
cash position a little and moving back to an overweight in stocks.
[right margin]
"WE ELIMINATED THE FUND'S STRATEGIC WEIGHTING IN FOREIGN BONDS BECAUSE WE FOUND
THAT THIS SLICE OF THE PORTFOLIO INCREASED THE FUND'S OVERALL RISK LEVEL
WITHOUT A MEASURABLE INCREASE IN PERFORMANCE."
FUND'S U.S. BONDS
AS OF MAY 31, 2000
NUMBER OF SECURITIES 111
WEIGHTED AVERAGE MATURITY 8.3 YRS
AVERAGE DURATION 5.0 YRS
[pie chart - data below]
% OF FUND'S U.S. BONDS
CORPORATE SECURITIES 28%
MORTGAGE-BACKED SECURITIES 27%
U.S. TREASURY SECURITIES 23%
U.S. GOVT. AGENCY SECURITIES 15%
ASSET-BACKED SECURITIES 6%
OTHER 1%
www.americancentury.com 7
Strategic Conservative--Q&A
--------------------------------------------------------------------------------
(Continued)
WHAT'S THE ATTRACTION OF STOCKS RIGHT NOW?
We think that the stock market is in a better position after weathering a
period of economic uncertainty. While we certainly don't expect to see the 25%
annual returns that the S&P 500 posted over the past five years, we do expect
greater stability and returns more in line with corporate earnings growth as we
move forward.
That said, we also believe that we're closer to the beginning than the end of
the shakeout among technology companies, and we're not sure how that will
ultimately play out.
CAN YOU TALK A LITTLE BIT MORE ABOUT THIS SHAKEOUT?
The decline in technology shares over the past few months has taken some of
the air out of the New Economy balloon, and investors are starting to take a
harder look at the long-term business plans and profitability of their
technology investments.
Prior to this year, venture capital for technology start-ups flowed freely,
and tech firms were going public at a rate of several per week. In the past six
months, however, the market for initial public offerings has dried up, and
venture capital has become increasingly hard to get.
As the tech sector continues to evolve, we expect to see a great deal of
consolidation. A large number of companies that were built on promises and
little else will likely be bought out or disappear completely. In the end,
though, we expect the survivors to be stronger and in a better position to be
successful and profitable companies over the long term.
WILL THIS HAVE ANY EFFECT ON YOUR INVESTMENT STRATEGY GOING FORWARD?
It won't change the way we look at technology stocks or equity investing in
general. Our stock portfolio managers have always emphasized high-quality
companies, whether they're technology-oriented firms or industrial
manufacturers. We'll continue to invest in technology companies that meet our
stringent investment guidelines.
HOW WILL YOU POSITION THE PORTFOLIO'S BOND HOLDINGS GOING FORWARD?
We intend to maintain our current neutral position in bonds. We're starting
to see evidence that the U.S. economy is slowing down, and that probably means
the Fed is finished raising interest rates for the time being. Although
inflation is higher than it has been in the past couple of years, it's still low
on a historical basis. These factors are generally positive for bonds.
We still favor a longer duration in our Treasury bond holdings and an
overweight in corporate bonds, which look very attractive after underperforming
the rest of the bond market over the past year or two. However, we'll be keeping
a close eye on the credit quality of our corporate holdings, sticking with those
that we think can remain financially sound during an economic slowdown.
[left margin]
FUND'S U.S. STOCKS
AS OF MAY 31, 2000
NUMBER OF COMPANIES 281
DIVIDEND YIELD 1.7%
PRICE/EARNINGS RATIO 19.4
TOP 5 U.S. STOCKS
% OF FUND'S % OF
U.S. STOCKS FUND
SUMMIT BANCORP. 2.4% 0.8%
SPRINT CORP. 2.3% 0.8%
GTE CORP. 2.1% 0.7%
BANK OF AMERICA CORP. 2.1% 0.7%
FIRST VIRGINIA BANKS, INC. 2.1% 0.7%
FUND'S FOREIGN STOCKS
AS OF MAY 31, 2000
NUMBER OF COMPANIES 104
DIVIDEND YIELD 0.9%
TOP 5 FOREIGN STOCKS
% OF FUND'S % OF
COUNTRY FOREIGN STOCKS FUND
ROYAL DUTCH
PETROLEUM CO.
NEW YORK SHARES NETHERLANDS 5.0% 0.4%
NORTEL NETWORKS
CORP. CANADA 3.7% 0.3%
VODAFONE AIRTOUCH
PLC ORD U.K. 3.2% 0.3%
BP AMOCO PLC ADR U.K. 2.9% 0.2%
SKANDIA FORSAKRINGS
AB ORD SWEDEN 2.8% 0.2%
[pie chart - data below]
% OF FUND'S FOREIGN STOCKS
EUROPE 78%
ASIA/PACIFIC 16%
AMERICAS (EXCLUDING U.S.) 6%
8 1-800-345-2021
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
COMMON STOCKS -- 41.7%
ALCOHOL(1)
700 Anheuser-Busch Companies, Inc. $ 54,250
------------
APPAREL & TEXTILES -- 0.1%
550 Kenneth Cole Productions, Inc.
Cl A(2) 18,391
3,300 Liz Claiborne, Inc. 129,731
------------
148,122
------------
BANKS -- 4.4%
39,150 Banca Intesa S.p.A. ORD 154,873
22,500 Bank of America Corp. 1,250,156
3,600 Barclays PLC ORD 93,775
5,000 Chase Manhattan Corp. 373,438
7,500 Citigroup Inc. 466,406
18,100 First Union Corp. 636,894
31,400 First Virginia Banks, Inc. 1,246,188
1,600 Fleet Boston Financial Corp. 60,500
47,200 KeyCorp 991,200
15,051 Nordic Baltic Holding AB ORD 99,912
1,700 Old Kent Financial Corp. 56,525
6,700 PNC Bank Corp. 337,512
2,700 Societe Generale Cl A ORD 156,174
50,900 Summit Bancorp. 1,460,194
4,200 UnionBanCal Corp. 143,850
5,900 Wachovia Corp. 407,838
------------
7,935,435
------------
CHEMICALS -- 1.1%
3,000 Dow Chemical Co. 321,188
4,800 du Pont (E.I.) de Nemours & Co. 235,200
12,600 Minnesota Mining &
Manufacturing Co. 1,080,450
8,300 Praxair, Inc. 348,600
------------
1,985,438
------------
CLOTHING STORES(1)
1,200 Gadzooks, Inc.(2) 17,100
------------
COMPUTER HARDWARE &
BUSINESS MACHINES -- 1.0%
200 Adaptec, Inc.(2) 3,944
700 Apple Computer, Inc.(2) 58,822
6,000 Dell Computer Corp.(2) 258,938
4,000 EMC Corp. (Mass.)(2) 465,250
2,000 Hewlett-Packard Co. 240,250
1,200 Network Appliances, Inc.(2) 77,438
800 Network Peripherals, Inc.(2) 14,225
600 Proxim, Inc.(2) 52,369
1,000 Sanmina Corp.(2) 63,656
2,900 Sun Microsystems, Inc.(2) 222,122
13,300 Xerox Corp. 360,762
------------
1,817,776
------------
Shares Value
--------------------------------------------------------------------------------
COMPUTER SOFTWARE -- 1.5%
1,300 Amdocs Ltd.(2) $ 80,519
4,000 Autodesk, Inc. 148,125
800 Business Objects S.A. ADR(2) 64,000
1,300 Computer Associates
International, Inc. 66,950
3,900 International Business Machines
Corp. 418,519
318 Intershop Communications
AG ORD(2) 129,069
500 Lernout & Hauspie Speech
Products N.V.(2) 20,922
3,600 Logica plc ORD 96,471
9,900 Microsoft Corp.(2) 619,059
11,300 Misys plc ORD 97,665
950 National Instruments Corp.(2) 34,408
2,000 Objective Systems
Integrators, Inc.(2) 14,719
2,200 ONYX Software Corp.(2) 37,606
8,100 Oracle Corp.(2) 581,681
600 SAP AG ADR 25,725
1,600 Tieto Corp. Cl B ORD 62,696
1,600 Veritas Software Corp.(2) 186,350
------------
2,684,484
------------
CONSTRUCTION & REAL PROPERTY(1)
300 Mastec, Inc.(2) 20,512
850 Quanta Services, Inc.(2) 41,650
------------
62,162
------------
CONSUMER DURABLES -- 0.3%
6,600 Assa Abloy AB Cl B ORD 127,388
3,900 Pier 1 Imports, Inc. 33,150
2,000 PIONEER CORP. ORD 60,988
7,000 Sharp Corporation ORD 125,869
84 Swatch Group AG (The)
Cl B ORD 103,103
1,300 Whirlpool Corp. 73,694
------------
524,192
------------
DEFENSE/AEROSPACE -- 0.6%
12,700 Boeing Co. 496,094
18,100 Lockheed Martin Corp. 443,450
200 Northrop Grumman Corp. 15,325
6,000 Raytheon Co. Cl B 140,625
------------
1,095,494
------------
DEPARTMENT STORES -- 0.6%
3,700 Ames Department Stores, Inc.(2) 43,822
7,800 May Department Stores Co. (The) 234,488
900 Pinault-Printemps-Redoute
SA ORD 194,176
1,300 Sears, Roebuck & Co. 48,019
10,800 Wal-Mart Stores, Inc. 622,350
------------
1,142,855
------------
See Notes to Financial Statements www.americancentury.com 9
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
DRUGS -- 1.9%
1,000 American Home Products Corp. $ 53,875
3,100 Amgen Inc.(2) 197,334
900 Aventis SA ORD 58,665
800 Biogen, Inc.(2) 43,575
10,100 Bristol-Myers Squibb Co. 556,131
900 Diversa Corp.(2) 19,688
3,100 Enzon, Inc.(2) 89,416
1,000 ILEX Oncology, Inc.(2) 24,969
1,400 IVAX Corp.(2) 52,675
1,400 Jones Pharma Inc. 51,056
300 MedImmune, Inc.(2) 46,603
1,400 Merck & Co., Inc. 104,475
99 Novartis AG ORD 146,523
1,241 Novo Nordisk A/S Cl B ORD 205,986
11,300 Pfizer, Inc. 503,556
1,700 Protein Design Labs, Inc.(2) 181,316
500 QLT PhotoTherapeutics Inc.(2) 24,500
6,000 Schering-Plough Corp. 290,250
1,000 Takeda Chemical Industries,
Ltd. ORD 68,125
1,500 Tanox, Inc.(2) 75,797
1,100 Titan Pharmaceuticals, Inc.(2) 27,912
5,400 Warner-Lambert Co. 659,475
------------
3,481,902
------------
ELECTRICAL EQUIPMENT -- 4.1%
1,100 Advanced Energy Industries, Inc.(2) 40,562
4,335 Alcatel Alsthom Compagnie
Generale ORD 240,408
1,700 ANTEC Corp.(2) 85,212
1,100 AVX Technology 63,044
3,500 Celestica Inc.(2) 162,969
1,500 CIENA Corp.(2) 179,578
18,900 Cisco Systems Inc.(2) 1,075,528
2,300 Comverse Technology, Inc.(2) 210,234
1,000 Corning Inc. 193,438
900 Credence Systems Corp.(2) 49,162
3,200 Digital Microwave Corp.(2) 89,300
500 E-Tek Dynamics, Inc.(2) 91,953
12,700 Ericsson (L.M.) Telephone
Co. ADR 259,953
3,059 Flextronics International
Ltd. ADR(2) 166,429
3,400 Glenayre Technologies, Inc.(2) 27,944
1,100 Harmonic Inc.(2) 49,122
14,000 Hitachi Ltd. ORD 173,102
900 Integrated Circuit Systems, Inc.(2) 10,912
9,684 JDS Uniphase Corp.(2) 852,192
1,300 KEMET Corp.(2) 87,344
200 Keyence Corporation ORD 59,783
1,600 KLA-Tencor Corporation(2) 79,250
1,600 Motorola, Inc. 150,000
6,000 Nokia Corp. Cl A ADR 312,000
10,400 Nortel Networks Corp. 564,850
Shares Value
--------------------------------------------------------------------------------
8,048 Phillips Electronics N.V. New
York Shares $ 355,621
11,000 Pinnacle Systems, Inc.(2) 262,969
3,900 Powerwave Technologies, Inc.(2) 211,209
100 Sagem SA New Shares ORD 117,742
1,700 Scientific-Atlanta, Inc. 95,838
1,500 Sensormatic Electronics Corp.(2) 23,531
1,800 Siemens AG ORD 264,641
900 Sony Corp. ORD 81,333
3,400 Tekelec, Inc.(2) 111,988
1,000 Tokyo Electron Ltd. ORD 136,250
1,900 Tollgrade Communications, Inc.(2) 125,756
20,000 Toshiba Corp. ORD 192,789
1,700 Vishay Intertechnology, Inc.(2) 120,275
3,200 Westell Technologies, Inc.(2) 52,900
------------
7,427,111
------------
ELECTRICAL UTILITIES -- 1.3%
1,200 AES Corp. (The)(2) 104,700
2,000 Calpine Corp.(2) 211,875
6,200 Florida Progress Corp. 307,675
23,800 FPL Group, Inc. 1,178,100
2,300 Minnesota Power & Light Co. 42,406
10,400 Niagara Mohawk Holdings Inc.(2) 152,750
2,400 Public Service Enterprise Group Inc. 89,400
2,700 Reliant Energy, Inc. 76,950
1,600 Southern Co. 41,500
2,400 Utilicorp United Inc. 47,100
------------
2,252,456
------------
ENERGY RESERVES & PRODUCTION -- 2.6%
5,000 Amerada Hess Corp. 331,875
3,000 Apache Corp. 182,625
8,200 BP Amoco Plc ADR 445,875
6,700 Burlington Resources Inc. 306,525
9,700 Chevron Corp. 896,644
10,112 Exxon Mobil Corp. 842,456
4,700 Kerr-McGee Corp. 280,531
5,900 Murphy Oil Corp. 382,762
12,200 Royal Dutch Petroleum Co.
New York Shares 761,738
3,900 Triton Energy Ltd.(2) 130,162
3,200 Union Pacific Resources 75,800
------------
4,636,993
------------
ENTERTAINMENT -- 0.2%
7,167 Viacom, Inc. Cl B(2) 444,354
------------
EQUITY REAL ESTATE INVESTMENT TRUST(1)
1,300 Pinnacle Holdings Inc.(2) 63,659
------------
FINANCIAL SERVICES -- 1.6%
2,000 American Express Co. 107,625
4,900 Countrywide Credit Industries, Inc. 150,675
1,100 Credit Suisse Group ORD 205,956
3,600 Fannie Mae 216,450
1,600 Federal Home Loan Mortgage
Corporation 71,200
10 1-800-345-2021 See Notes to Financial Statements
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
19,800 General Electric Co. (U.S.) $ 1,041,975
2,201 ING Groep N.V. ORD 131,962
34 Julius Baer Holding AG ORD 122,266
270 Marschollek Lautenschlaeger und
Partner AG ORD 95,194
1,500 Marsh & McLennan Companies,
Inc. 165,094
800 Providian Financial Corp. 71,150
16,600 Skandia Forsakrings AB ORD 425,964
------------
2,805,511
------------
FOOD & BEVERAGE -- 1.4%
55,961 Archer-Daniels-Midland Co. 668,034
10,278 Diageo plc ORD 88,062
4,300 IBP, Inc. 70,950
46,200 Interstate Bakeries Corp. 669,900
4,200 PepsiCo, Inc. 170,888
3,200 Quaker Oats Co. (The) 235,400
2,300 Suiza Foods Corp.(2) 103,212
55,600 Tyson Foods, Inc. Cl A 549,050
------------
2,555,496
------------
FOREST PRODUCTS & PAPER -- 0.1%
3,667 International Paper Co. 127,657
800 Temple-Inland Inc. 39,750
1,800 Weyerhaeuser Co. 89,325
------------
256,732
------------
GAS & WATER UTILITIES -- 0.8%
31,400 AGL Resources Inc. 522,025
52,362 Centrica plc ORD 189,808
1,100 Kinder Morgan, Inc. 35,888
1,300 Suez Lyonnaise des Eaux ORD 218,837
19,300 Washington Gas Light Co. 513,862
------------
1,480,420
------------
GOLD -- 0.1%
8,400 Barrick Gold Corp. 151,725
------------
GROCERY STORES(1)
1,700 Safeway Inc.(2) 78,412
------------
HEAVY ELECTRICAL EQUIPMENT -- 1.0%
2,861 ABB Ltd. ORD 356,265
400 C&D Technologies, Inc. 29,000
2,000 CommScope, Inc.(2) 77,250
16,900 Cooper Industries, Inc. 566,150
1,300 Cummins Engine Company, Inc. 42,331
13,000 Emerson Electric Co. 767,000
------------
1,837,996
------------
HEAVY MACHINERY(1)
1,300 Atlas Copco AB Cl A ORD 27,992
900 Atlas Copco AB Cl B ORD 20,082
------------
48,074
------------
HOME PRODUCTS -- 0.2%
1,800 Avon Products, Inc. 74,362
1,100 Colgate-Palmolive Co. 57,888
Shares Value
--------------------------------------------------------------------------------
2,000 Kao Corporation ORD $ 60,617
1,200 Procter & Gamble Co. (The) 79,800
------------
272,667
------------
HOTELS(1)
3,100 Park Place Entertainment Corp.(2) 39,106
------------
INDUSTRIAL PARTS -- 0.3%
264 Assa Abloy AB Cl B ORD(2) 5,096
700 Cymer, Inc.(2) 22,116
2,677 Illinois Tool Works Inc. 155,433
800 United Technologies Corp. 48,350
8,900 York International Corp. 232,512
------------
463,507
------------
INDUSTRIAL SERVICES -- 0.3%
4,600 Capita Group Plc ORD 103,011
5,300 Compass Group PLC ORD 59,462
1,600 Hertz Corp. Cl A 50,100
1,400 ISS A/S ORD(2) 101,720
6,800 Securitas AB Cl B ORD 158,939
------------
473,232
------------
INFORMATION SERVICES -- 1.3%
117 Adecco SA ORD 92,632
1,300 Automatic Data Processing, Inc. 71,419
1,400 BISYS Group, Inc. (The)(2) 92,094
213 Cap Gemini SA ORD 40,019
10,300 Ceridian Corp.(2) 248,488
8,400 CMG plc ORD 117,393
3,400 Computer Sciences Corp.(2) 326,188
2,600 Cysive, Inc.(2) 65,975
3,300 Diamond Technology Partners
Inc.(2) 208,931
7,100 Dun & Bradstreet Corp. (The) 218,325
1,500 Electronic Data Systems Corp. 96,469
1,500 eLoyalty Corp.(2) 22,406
2,900 First Data Corp. 162,581
5,700 Getronics N.V. ORD 95,685
13,400 Hays plc ORD 75,269
2,800 Proxicom, Inc.(2) 128,362
700 Sapient Corp.(2) 69,934
8,000 SEMA Group plc ORD 111,683
1,000 TenFold Corp.(2) 17,500
2,100 Valassis Communications, Inc.(2) 69,300
------------
2,330,653
------------
INTERNET -- 0.4%
6,700 America Online Inc.(2) 355,100
500 Digital Island(2) 9,172
1,200 GlobeSpan, Inc.(2) 106,088
1,700 Portal Software, Inc.(2) 68,372
599 Tiscali SpA ORD(2) 29,858
1,300 Verio Inc.(2) 74,181
1,200 Yahoo! Inc.(2) 135,638
------------
778,409
------------
See Notes to Financial Statements www.americancentury.com 11
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
LEISURE -- 0.2%
2,700 Eastman Kodak Co. $ 161,325
6,800 GTECH Holdings Corp.(2) 150,025
1,000 Polaroid Corp. 19,188
------------
330,538
------------
LIFE & HEALTH INSURANCE -- 0.2%
900 CIGNA Corp. 79,931
4,300 Lincoln National Corp. 166,625
6,900 Mediolanum SpA ORD 105,827
------------
352,383
------------
MEDIA -- 1.2%
3,600 Clear Channel Communications,
Inc.(2) 269,550
3,000 Comcast Corp. Cl A(2) 113,719
1,300 Cox Communications, Inc. Cl A(2) 57,362
6,700 Disney (Walt) Co. 282,656
987 EM.TV & Merchandising AG ORD 66,321
6 Fuji Television Network, Inc. ORD 91,204
500 General Motors Corp. Cl H(2) 49,219
2,900 Infinity Broadcasting Corp. Cl A(2) 91,712
6,267 Mediaset SpA ORD 97,291
1,221 Modern Times Group MTG
AB Cl B ORD(2) 54,830
8,900 Mondadori (Arnoldo) Editore
SpA ORD 205,169
3,800 News Corp. Ltd. (The) ADR 173,138
2,600 Pearson plc ORD 78,514
300 Radio One, Inc.(2) 21,488
200 Societe Television
Francaise 1 ORD 129,058
1,419 Sogecable, S.A. ORD(2) 52,684
1,700 UnitedGlobalCom Cl A(2) 81,547
900 Univision Communications
Inc. Cl A(2) 92,700
8,800 WPP Group plc ORD 107,166
------------
2,115,328
------------
MEDICAL PRODUCTS & SUPPLIES -- 0.7%
1,100 Aclara BioSciences, Inc.(2) 29,734
300 ArthroCare Corp.(2) 25,575
200 Aurora Biosciences Corp.(2) 9,481
1,600 Bard (C.R.), Inc. 73,000
5,900 Beckman Coulter Inc. 354,738
2,000 CONMED Corp.(2) 48,188
2,700 Guidant Corp.(2) 136,688
1,000 Hoya Corp. ORD 92,594
2,600 Johnson & Johnson 232,700
3,400 Medtronic, Inc. 175,525
700 MiniMed Inc.(2) 83,519
400 Nanogen, Inc.(2) 9,925
------------
1,271,667
------------
MEDICAL PROVIDERS & SERVICES -- 0.6%
30,300 HCA-The Healthcare Corp.(2) 818,100
3,800 Oxford Health Plans, Inc.(2) 80,869
Shares Value
--------------------------------------------------------------------------------
700 PacifiCare Health Systems, Inc.(2) $ 45,369
1,100 United HealthCare Corp. 82,019
------------
1,026,357
------------
MINING & METALS -- 0.2%
3,000 Alcoa Inc. 175,312
3,400 Maverick Tube Corp.(2) 119,531
------------
294,843
------------
MOTOR VEHICLES & PARTS -- 0.5%
6,300 Ford Motor Co. 305,944
600 General Motors Corp. 42,375
14,600 Superior Industries International, Inc. 407,888
2,000 Toyota Motor Corp. ORD 90,648
------------
846,855
------------
MULTI-INDUSTRY -- 0.4%
11,900 Hutchison Whampoa Limited
ORD 137,440
6,100 Tyco International Ltd. 287,081
2,627 Vivendi ORD 282,529
------------
707,050
------------
OIL SERVICES -- 0.6%
4,100 Baker Hughes Inc. 148,625
800 BJ Services Co.(2) 57,300
2,300 Ensco International Inc. 80,356
2,600 Global Marine Inc.(2) 73,612
1,000 Grant Prideco, Inc(2) 23,250
4,900 Key Energy Group, Inc.(2) 53,288
5,500 Marine Drilling Co., Inc.(2) 158,125
2,200 National-Oilwell, Inc.(2) 57,200
1,600 Patterson Energy, Inc.(2) 38,650
3,500 R&B Falcon Corp.(2) 82,031
4,800 Rowan Companies, Inc.(2) 149,100
800 Smith International, Inc.(2) 63,250
2,300 Transocean Sedco Forex, Inc. 113,131
800 Weatherford International, Inc.(2) 34,450
------------
1,132,368
------------
PROPERTY & CASUALTY INSURANCE -- 1.6%
10,100 Alleanza Assicurazioni ORD 116,558
11,300 Allstate Corp. 299,450
1,800 Ambac Financial Group, Inc. 90,675
2,650 American International Group, Inc. 298,291
1,248 Axa ORD 184,406
10,200 Chubb Corp. (The) 714,000
700 Everest Reinsurance Holdings, Inc. 23,800
34,000 Horace Mann Educators Corp. 578,000
9,800 MGIC Investment Corp. 485,712
6,600 Prudential Corporation PLC ORD 99,998
900 Radian Group Inc. 49,500
------------
2,940,390
------------
PUBLISHING -- 0.4%
846 Altran Technologies SA ORD 190,674
11,700 Banta Corp. 216,450
2,800 Deluxe Corp. 69,125
12 1-800-345-2021 See Notes to Financial Statements
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
1,300 Dow Jones & Co., Inc. $ 88,400
4,200 VNU N.V. ORD 214,853
------------
779,502
------------
RAILROADS -- 0.2%
6,700 Union Pacific Corp. 283,494
------------
RESTAURANTS -- 0.1%
1,900 Brinker International, Inc.(2) 53,794
2,400 Jack in the Box Inc.(2) 59,550
------------
113,344
------------
SECURITIES & ASSET MANAGEMENT -- 0.4%
13,900 Amvescap Plc ORD 182,598
279 Consors Discount Broker
AG ORD 26,131
5,800 Morgan Stanley Dean Witter & Co. 417,238
6,000 Nomura Securities Co., Ltd. ORD 137,362
------------
763,329
------------
SEMICONDUCTOR -- 2.1%
1,900 Applied Materials, Inc.(2) 158,709
900 ASM Lithography Holding N.V.
New York Shares(2) 32,147
1,800 Asyst Technologies, Inc.(2) 72,394
1,000 Brooks Automation, Inc.(2) 39,875
2,000 Canon, Inc. ORD 91,946
3,800 Cypress Semiconductor Corp.(2) 159,838
3,550 Exar Corp.(2) 243,730
2,200 Integrated Device Technology,
Inc.(2) 104,638
6,400 Intel Corp. 798,200
1,200 International Rectifier Corp.(2) 49,500
1,700 Kopin Corp.(2) 120,381
700 Kulicke & Soffa Industries, Inc.(2) 35,262
600 KYOCERA CORP. ORD 99,435
4,600 Lam Research Corp.(2) 147,919
1,600 Linear Technology Corp. 94,450
1,200 LSI Logic Corp.(2) 63,225
1,200 Maxim Integrated Products, Inc.(2) 76,088
1,300 National Semiconductor Corp.(2) 69,875
1,000 Pericom Semiconductor Corp.(2) 41,000
200 PMC-Sierra, Inc.(2) 30,656
1,000 Power Integrations, Inc.(2) 23,438
1,900 PRI Automation, Inc.(2) 97,672
2,200 REMEC, Inc.(2) 74,662
1,200 SanDisk Corp.(2) 69,862
2,000 Sawtek Inc.(2) 128,562
4,200 STMicroelectronics N.V. New
York Shares 251,475
600 Teradyne, Inc.(2) 51,600
5,000 Texas Instruments Inc. 361,250
1,500 Xilinx, Inc.(2) 114,141
------------
3,701,930
------------
SPECIALTY STORES -- 0.5%
700 Best Buy Co., Inc.(2) 44,800
2,200 Hennes & Mauritz AB Cl B ORD 55,717
Shares Value
--------------------------------------------------------------------------------
8,050 Home Depot, Inc. $ 392,941
1,900 NBTY, Inc.(2) 30,341
27,000 Office Depot, Inc.(2) 190,688
400 Ryohin Keikaku Co. Limited ORD 58,170
1,400 Zale Corp.(2) 53,200
------------
825,857
------------
TELEPHONE -- 3.1%
10,000 AT&T Corp. 346,875
2,200 Bell Atlantic Corp. 116,325
8,800 BellSouth Corp. 410,850
5,600 Century Telephone Enterprises, Inc. 151,200
2,512 COLT Telecom Group plc ORD(2) 88,763
850 Covad Communications Group,
Inc.(2) 20,214
1,921 Energis plc ORD(2) 73,088
19,800 GTE Corp. 1,252,350
3 Japan Telecom Co. Ltd. ORD 131,523
3,400 McLeodUSA Inc. Cl A(2) 68,106
1,200 NEXTLINK Communications,
Inc. Cl A(2) 84,112
631 NTL Inc.(2) 37,308
13,000 SBC Communications Inc. 567,938
4,425 Sonera Group Oyj ORD 224,708
22,600 Sprint Corp. 1,367,300
1,100 Tele Danmark A/S ORD 77,856
11,500 Telecom Italia SpA ORD 159,171
15,404 Telefonica S.A. ORD(2) 316,928
14,245 TeleWest Communications plc
ORD(2) 58,038
600 U S WEST, Inc. 43,200
1,484 United Pan-Europe
Communications NV ORD(2) 38,540
------------
5,634,393
------------
TOBACCO -- 0.3%
29,600 UST Inc. 492,100
------------
WIRELESS TELECOMMUNICATIONS -- 1.2%
1,600 ALLTEL Corp. 104,700
1,000 Audiovox Corp. Cl A(2) 18,906
12,798 Cable & Wireless plc ORD 213,747
26,000 China Telecom (Hong Kong)
Ltd. ORD(2) 194,354
6,000 LCC International, Inc. Cl A(2) 88,688
1,383 NetCom Systems AB Cl B ORD(2) 97,979
500 Nextel Communications, Inc.(2) 46,297
4 NTT Mobile Communications
Network, Inc. ORD 103,068
6,200 QUALCOMM Inc.(2) 411,331
4,200 Sprint PCS(2) 233,100
4,581 Telecel-Comunicacaoes Pessoais,
SA ORD 74,544
108,573 Vodafone AirTouch PLC ORD 496,026
------------
2,082,740
------------
TOTAL COMMON STOCKS 75,040,191
------------
(Cost $60,925,072)
See Notes to Financial Statements www.americancentury.com 13
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
U.S. TREASURY SECURITIES -- 11.0%
$4,800,000 U.S. Treasury Notes, 6.00%,
8/15/00 $ 4,801,502
1,500,000 U.S. Treasury Notes, 4.875%,
3/31/01 1,478,438
4,050,000 U.S. Treasury Notes, 6.625%,
7/31/01 4,044,938
1,600,000 U.S. Treasury Bonds, 9.25%,
2/15/16 2,040,501
1,000,000 U.S. Treasury Bonds, 8.75%,
5/15/17 1,237,500
3,650,000 U.S. Treasury Bonds, 7.875%,
2/15/21 4,268,219
1,000,000 U.S. Treasury Bonds, 5.25%,
2/15/29 873,750
1,000,000 U.S. Treasury Bonds, 6.25%,
5/15/30 1,031,875
------------
TOTAL U.S. TREASURY SECURITIES 19,776,723
------------
(Cost $19,755,782)
U.S. GOVERNMENT AGENCY SECURITIES -- 7.5%
1,100,000 FHLMC MTN, 6.50%, 1/19/01 1,096,291
700,000 FNMA, 7.25%, 5/25/01 700,963
2,600,000 FNMA, 5.25%, 1/15/03 2,474,789
2,600,000 FNMA, 7.125%, 2/15/05 2,574,393
2,300,000 FNMA, 7.25%, 1/15/10 2,264,976
650,000 FNMA, 7.125%, 1/15/30 633,587
2,500,000 FNMA MTN, 6.23%, 7/21/08 2,283,388
1,500,000 SLMA MTN, VRN, 6.49%,
6/6/00, resets weekly off the
3-month T-Bill rate plus 0.60%
with no caps 1,500,147
------------
TOTAL U.S. GOVERNMENT
AGENCY SECURITIES 13,528,534
------------
(Cost $13,823,014)
SOVEREIGN GOVERNMENTS & AGENCIES -- 0.3%
500,000 Province of Quebec, 7.50%,
9/15/29 477,542
------------
(Cost $494,395)
MORTGAGE-BACKED SECURITIES(3) -- 12.3%
397,475 FHLMC Pool #E68523, 6.50%,
12/1/12 378,664
1,085,876 FHLMC Pool #E00724, 7.00%,
6/1/14 1,052,043
27,471 FNMA Pool #343829, 6.50%,
4/1/11 26,210
512,426 FNMA Pool #341477, 6.50%,
5/1/11 488,909
171,586 FNMA Pool #346400, 6.50%,
5/1/11 163,711
Principal Amount Value
--------------------------------------------------------------------------------
$ 285,102 FNMA Pool #346779, 6.50%,
5/1/11 $ 272,018
146,832 FNMA Pool #369034, 6.50%,
2/1/12 139,839
248,176 FNMA Pool #377181, 6.50%,
4/1/12 236,357
544,215 FNMA Pool #378039, 6.50%,
5/1/12 518,298
700,000 FNMA REMIC, Series 1997-58,
Class PB PAC, 6.50%,
6/18/24 654,378
58,150 FNMA Pool #250576, 7.00%,
6/1/26 55,407
424,748 FNMA Pool #373510, 7.50%,
3/1/27 413,692
1,977,416 FNMA Pool #412562, 6.50%,
1/1/28 1,834,496
999,901 FNMA Pool #448031, 6.50%,
6/1/29 925,910
477,986 FNMA Pool #503915, 7.00%,
7/1/29 453,859
912,183 FNMA Pool #504748, 7.00%,
7/1/29 866,452
1,996,055 FNMA Pool #253112, 7.00%,
3/1/30 1,895,305
400,000 FNMA Pool #537234, 7.00%,
5/1/30 379,688
246,465 GNMA Pool #351417, 7.00%,
1/15/24 237,557
82,746 GNMA Pool #361446, 8.00%,
7/15/24 83,180
106,126 GNMA Pool #377238, 8.50%,
7/20/24 107,667
146,640 GNMA Pool #355903, 8.00%,
9/15/24 147,409
387,744 GNMA Pool #404303, 8.25%,
10/15/24 391,245
30,176 GNMA Pool #392995, 8.75%,
3/15/25 30,811
81,250 GNMA Pool #001991, 9.00%,
4/20/25 83,234
145,683 GNMA Pool #009297, 8.25%,
7/20/25 145,704
394,839 GNMA Pool #412177, 7.00%,
9/15/25 380,361
330,639 GNMA Pool #416856, 7.50%,
10/15/25 325,575
165,359 GNMA Pool #425081, 7.50%,
2/15/26 162,721
134,406 GNMA Pool #372335, 7.50%,
4/15/26 132,261
19,340 GNMA Pool #417549, 6.00%,
4/15/26 17,649
96,290 GNMA Pool #402680, 8.00%,
5/15/26 96,723
211,493 GNMA Pool #417068, 8.00%,
5/15/26 212,444
168,896 GNMA Pool #422006, 7.50%,
5/15/26 166,201
14 1-800-345-2021 See Notes to Financial Statements
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
$ 42,344 GNMA Pool #402682, 7.50%,
6/15/26 $ 41,669
551,638 GNMA Pool #431942, 8.25%,
7/15/26 556,475
77,282 GNMA Pool #002273, 9.00%,
8/20/26 79,141
550,525 GNMA Pool #456569, 7.50%,
11/15/27 541,582
1,178,485 GNMA Pool #457351, 7.00%,
12/15/27 1,132,401
535,728 GNMA Pool #404525, 6.50%,
2/15/28 501,562
473,888 GNMA Pool #436196, 6.50%,
2/15/28 443,666
48,743 GNMA Pool #463081, 6.50%,
2/15/28 45,635
394,832 GNMA Pool #256771, 6.50%,
3/15/28 369,651
319,761 GNMA Pool #461658, 6.50%,
3/15/28 299,368
371,358 GNMA Pool #462615, 6.50%,
3/15/28 347,675
3,292,305 GNMA Pool #466804, 6.50%,
4/15/28 3,082,338
45,581 GNMA Pool #474216, 6.50%,
4/15/28 42,674
438,623 GNMA Pool #433786, 6.00%,
5/15/28 398,653
415,909 GNMA Pool #481773, 6.00%,
7/15/28 378,009
464,522 GNMA Pool #473140, 6.00%,
10/15/28 422,192
------------
TOTAL MORTGAGE-BACKED SECURITIES 22,158,669
------------
(Cost $23,075,026)
ASSET-BACKED SECURITIES(3) -- 2.9%
600,000 Americredit Automobile
Receivables Trust, Series
1999 D, Class A3 SEQ, 7.02%,
12/12/05 593,217
400,000 Comed Transitional Funding Trust,
Series 1998-1, Class A6 SEQ,
5.63%, 6/25/09 360,414
1,200,000 GMAC Commercial Mortgage
Securities Inc., Series 1999 C1,
Class A2 SEQ, 6.18%,
5/15/33 1,070,188
190,755 Money Store (The) Home Equity
Trust, Series 1995 C, Class A9
SEQ, 6.375%, 9/15/11 190,129
500,000 Money Store (The) Home Equity
Trust, Series 1997 C, Class AF6
SEQ, 6.67%, 2/15/25 490,222
885,733 Morgan Stanley Capital I,
Series 1998 WF1, Class A1
SEQ, 6.25%, 7/15/07 848,381
634,316 Nationslink Funding Corp.,
Series 1998-2, Class A1 SEQ,
6.00%, 11/20/07 594,721
Principal Amount Value
--------------------------------------------------------------------------------
$1,000,000 Nationslink Funding Corp.,
Series 1999-1, Class A2 SEQ,
6.32%, 11/20/08 $ 907,867
64,168 Textron Financial Corp.
Receivables Trust, Series
1997 A, Class A, 6.05%,
3/16/09 (Acquired 9/18/97,
Cost $64,083)(4) 63,963
------------
TOTAL ASSET-BACKED SECURITIES 5,119,102
------------
(Cost $5,494,244)
CORPORATE BONDS -- 13.4%
BANKS -- 3.7%
1,500,000 Abbey National Treasury Services
PLC MTN, Series 1A, VRN,
6.25%, 7/24/00, resets
quarterly off the 3-month
LIBOR minus 0.07% with no
caps 1,498,902
800,000 Bank of America Corp., 7.80%,
2/15/10 780,071
1,000,000 Bank of America Corp., 6.125%,
7/15/04 939,297
1,200,000 Bank of America N.A., VRN,
6.52%, 8/3/00, resets
quarterly off the 3-month
LIBOR plus 0.02% with no
caps 1,199,341
885,000 Bank One Corp. MTN, Series H,
VRN, 6.14%, 6/6/00, resets
quarterly off the 3-month
LIBOR plus 0.02% with no
caps 885,000
550,000 Citigroup Inc., 7.125%, 5/15/06 530,828
500,000 First Bank System Inc., 7.625%,
5/1/05 492,864
350,000 Fleet Boston Financial Corp.,
5.75%, 1/15/09 298,479
------------
6,624,782
------------
DEFENSE/AEROSPACE -- 0.4%
800,000 Raytheon Co., 8.20%, 3/1/06
(Acquired 3/3/00, Cost
$806,528)(4) 794,158
------------
DEPARTMENT STORES -- 0.4%
700,000 Wal-Mart Stores, Inc., 6.875%,
8/10/09 669,081
------------
ELECTRICAL UTILITIES -- 0.7%
700,000 Cilcorp, Inc., 8.70%, 10/15/09 683,982
600,000 Southern Investments UK, 6.80%,
12/1/06 546,738
------------
1,230,720
------------
ENERGY RESERVES & PRODUCTION -- 0.4%
700,000 EOG Resources Inc., 6.70%,
11/15/06 648,650
------------
See Notes to Financial Statements www.americancentury.com 15
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
FINANCIAL SERVICES -- 1.4%
$1,800,000 Ford Motor Credit Co., 7.50%,
3/15/05 $ 1,767,893
800,000 General Motors Acceptance Corp.
MTN, VRN, 6.28%, 6/12/00,
resets quarterly off the 3-month
LIBOR plus 0.15% with no caps 798,570
------------
2,566,463
------------
FOOD & BEVERAGE -- 0.4%
800,000 Pepsi Bottling Group Inc.,
Series B, 7.00%, 3/1/29
(Acquired 3/3/99, Cost
$794,560)(4) 696,234
------------
FOREST PRODUCTS & PAPER -- 0.5%
850,000 Fort James Corp., 6.625%,
9/15/04 804,681
------------
GOLD -- 0.2%
300,000 Barrick Gold Corp., 7.50%,
5/1/07 285,155
------------
INDUSTRIAL PARTS -- 0.3%
650,000 Petroleum Geo-Services ASA,
6.625%, 3/30/08 565,097
------------
LIFE & HEALTH INSURANCE -- 0.2%
500,000 Conseco Inc., 6.40%, 6/15/01 377,500
------------
MEDIA -- 0.8%
300,000 British Sky Broadcasting, 6.875%,
2/23/09 252,954
400,000 Liberty Media Group, 8.25%,
2/1/30 (Acquired 1/26/00,
Cost $396,796)(4) 344,220
800,000 TCI Communications, Inc., 8.75%,
8/1/15 843,135
------------
1,440,309
------------
MOTOR VEHICLES & PARTS -- 0.9%
800,000 DaimlerChrysler AG, 7.125%,
3/1/02(5) 795,831
1,000,000 Ford Motor Co., 6.375%, 2/1/29 802,312
------------
1,598,143
------------
MULTI-INDUSTRY -- 0.6%
300,000 Hutchison Whampoa Financial,
Series B, 7.45%, 8/1/17
(Acquired 11/19/99, Cost
$274,113)(4) 260,394
900,000 Tyco International Group SA,
6.875%, 9/5/02 (Acquired
1/11/00, Cost $884,385)(4) 881,884
------------
1,142,278
------------
OIL REFINING -- 0.4%
800,000 USX Corp., 6.65%, 2/1/06 741,738
------------
SECURITIES & ASSET MANAGEMENT -- 0.6%
350,000 Lehman Brothers Holdings Inc.,
6.625%, 4/1/04 329,619
Principal Amount Value
--------------------------------------------------------------------------------
$ 800,000 Morgan Stanley Dean Witter & Co.,
7.125%, 1/15/03 $ 788,913
------------
1,118,532
------------
TELEPHONE -- 1.5%
800,000 GTE North Inc., Series H, 5.65%,
11/15/08 686,707
500,000 U S West Capital Funding Inc.,
6.125%, 7/15/02 485,158
800,000 WorldCom, Inc., 7.875%,
5/15/03 798,627
800,000 WorldCom, Inc., VRN, 6.94%,
8/17/00, resets quarterly off
the 3-month LIBOR plus 0.18%
with no caps (Acquired
5/11/00, Cost $800,352)(4) 800,019
------------
2,770,511
------------
TOTAL CORPORATE BONDS 24,074,032
------------
(Cost $25,308,830)
COMMERCIAL PAPER(6) -- 8.7%
BANKS -- 0.3%
500,000 Pemex Capital, Inc., 6.00%,
6/27/00 497,562
------------
CREDIT CARD & TRADE RECEIVABLES -- 0.7%
1,200,000 WCP Funding Inc., 6.07%,
6/7/00 (Acquired 4/11/00,
Cost $1,188,467)(4) 1,198,474
------------
ELECTRICAL EQUIPMENT -- 0.3%
600,000 Motorola, Inc., 6.13%, 7/6/00 596,090
------------
ENERGY RESERVES & PRODUCTION -- 1.3%
1,200,000 Chevron Transport Corp., 6.09%,
6/22/00 (Acquired 3/24/00,
Cost $1,181,730)(4) 1,195,234
1,200,000 Sand Dollar Funding LLC, 6.13%,
6/19/00 (Acquired 4/5/00,
Cost $1,184,675)(4) 1,195,883
------------
2,391,117
------------
FINANCIAL SERVICES -- 1.1%
1,200,000 Fortis Funding LLC, 6.10%,
6/23/00 (Acquired 4/5/00,
Cost $1,183,937)(4) 1,195,016
731,000 Windmill Funding Corp., 6.65%,
8/25/00 (Acquired 5/24/00,
Cost $718,442)(4) 719,408
------------
1,914,424
------------
FOOD & BEVERAGE -- 0.7%
1,200,000 Brown-Forman Corp., 6.63%,
8/16/00 (Acquired 5/15/00,
Cost $1,179,668)(4) 1,183,006
------------
INDUSTRIAL PARTS -- 0.5%
1,000,000 Invensys plc, 6.65%, 8/14/00
(Acquired 5/17/00, Cost
$983,560)(4) 986,214
------------
16 1-800-345-2021 See Notes to Financial Statements
Strategic Conservative--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
LIFE & HEALTH INSURANCE -- 1.3%
$1,200,000 Allianz of America Inc., 6.15%,
7/5/00 $ 1,192,399
1,200,000 Prudential Funding Corp., 6.09%,
6/5/00 1,198,908
------------
2,391,307
------------
PROPERTY & CASUALTY INSURANCE -- 0.7%
1,300,000 Aegon Funding Corp., 6.64%,
8/17/00 (Acquired 5/18/00,
Cost $1,278,420)(4) 1,281,345
------------
SECURITIES & ASSET MANAGEMENT -- 1.8%
1,000,000 Credit Suisse First Boston Inc.,
5.93%, 7/10/00 (Acquired
1/6/00, Cost $970,021)(4) 992,746
1,000,000 Merrill Lynch & Co., Inc., 6.65%,
8/23/00 984,519
1,200,000 Morgan Stanley Dean Witter & Co.,
6.10%, 6/20/00 1,195,667
------------
3,172,932
------------
TOTAL COMMERCIAL PAPER 15,612,471
------------
(Cost $15,617,820)
CERTIFICATES OF DEPOSIT -- 1.1%
1,000,000 Canadian Imperial Bank of
Commerce (New York), 6.11%,
6/16/00 999,782
1,000,000 Deutsche Bank AG, 6.00%,
6/15/00 999,718
------------
TOTAL CERTIFICATES OF DEPOSIT 1,999,500
------------
(Cost $2,000,004)
Principal Amount Value
--------------------------------------------------------------------------------
FORWARD COMMITMENTS -- 0.4%
$ 800,000 FNMA Purchase, 7.50%,
settlement 6/19/00 $ 788,498
------------
(Cost $783,750)
TEMPORARY CASH INVESTMENTS -- 0.7%
Repurchase Agreement, Merrill Lynch & Co.,
Inc., (U.S. Treasury obligations), in a joint
trading account at 6.25%, dated 5/31/00,
due 6/1/00 (Delivery value $1,300,226) 1,300,000
------------
(Cost $1,300,000)
TOTAL INVESTMENT SECURITIES -- 100.0% $179,875,262
============
(Cost $168,577,937)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
Contracts Settlement Unrealized
to Sell Date Value Gain
--------------------------------------------------------------------------------
33,749,200 JPY 6/30/00 $314,469 $3,795
======================================
(Value on Settlement Date $318,264)
Forward foreign currency exchange contracts appear at the end of the schedule of
investments. These contracts are designed to protect the fund's foreign
investments against declines in foreign currencies (also known as hedging). The
contracts are called "forward" because they allow the fund to exchange a foreign
currency for U.S. dollars on a specific date in the future--and at a prearranged
exchange rate.
NOTES TO SCHEDULE OF INVESTMENTS
ADR = American Depositary Receipt
FHLMC = Federal Home Loan Mortgage Corporation
FNMA = Federal National Mortgage Association
GNMA = Government National Mortgage Association
JPY = Japanese Yen
LIBOR = London Interbank Offered Rate
MTN = Medium Term Note
ORD = Foreign Ordinary Share
SLMA = Student Loan Marketing Association
VRN = Variable Rate Note. Interest reset date is indicated and used in
calculating the weighted average portfolio maturity. Rate shown is effective May
31, 2000.
resets = The frequency with which a security's coupon changes, based on current
market conditions or an underlying index. The more frequently a security resets,
the less risk the investor is taking that the coupon will vary significantly
from current market rates.
(1) Industry is less than 0.05% of total investment securities.
(2) Non-income producing.
(3) Final maturity indicated. Expected remaining maturity used for purposes of
calculating the weighted average portfolio maturity.
(4) Security was purchased under Rule 144A or Section 4(2) of the Securities
Act of 1933 or is a private placement and, unless registered under the Act
or exempted from registration, may only be sold to qualified institutional
investors. The aggregate value of restricted securities at May 31, 2000,
was $13,788,198 which represented 7.7% of net assets.
(5) Security, or a portion thereof, has been segregated at the custodian bank
for Forward Commitments.
(6) The rates for commercial paper are the yield to maturity at purchase.
See Notes to Financial Statements www.americancentury.com 17
Strategic Moderate--Performance
--------------------------------------------------------------------------------
<TABLE>
TOTAL RETURNS AS OF MAY 31, 2000
INVESTOR CLASS (INCEPTION 2/15/96) ADVISOR CLASS (INCEPTION 10/2/96)
LEHMAN LEHMAN
STRATEGIC AGGREGATE 3-MONTH U.S. STRATEGIC AGGREGATE 3-MONTH U.S.
MODERATE S&P 500 BOND INDEX T-BILL INDEX MODERATE S&P 500 BOND INDEX T-BILL INDEX
===================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6 MONTHS(1) 7.71% 2.88% 1.38% 2.80% 7.58% 2.88% 1.38% 2.80%
1 YEAR 18.70% 10.48% 2.11% 5.26% 18.61% 10.48% 2.11% 5.26%
===================================================================================================================
AVERAGE ANNUAL RETURNS
3 YEARS 14.70% 20.45% 5.73% 5.01% 14.42% 20.45% 5.73% 5.01%
LIFE OF FUND 13.58% 22.59%(2) 5.62%(2) 5.05%(2) 13.91% 23.76%(3) 6.05%(3) 5.04%(3)
(1) Returns for periods less than one year are not annualized.
(2) Since 2/29/96, the date nearest the class's inception for which data
are available.
(3) Since 9/30/96, the date nearest the class's inception for which data
are available.
</TABLE>
See pages 62-64 for more information about share classes, returns, and the
comparative indices.
[mountain graph - data below]
GROWTH OF $10,000 OVER LIFE OF FUND
Value on 5/31/00
S&P 500 $23,764
Strategic Moderate $17,404
Lehman Aggregate $12,615
3-Month T-Bill $12,337
Strategic Lehman 3-Month
Moderate S&P 500 Aggregate T-Bill
DATE VALUE VALUE VALUE VALUE
2/29/1996 $10,000 $10,000 $10,000 $10,000
3/31/1996 $10,081 $10,096 $9,930 $10,041
6/30/1996 $10,411 $10,549 $9,987 $10,168
9/30/1996 $10,650 $10,875 $10,171 $10,298
12/31/1996 $11,019 $11,781 $10,476 $10,426
3/31/1997 $10,824 $12,097 $10,418 $10,560
6/30/1997 $11,850 $14,210 $10,800 $10,694
9/30/1997 $12,709 $15,273 $11,159 $10,830
12/31/1997 $12,697 $15,712 $11,487 $10,969
3/31/1998 $13,817 $17,903 $11,666 $11,109
6/30/1998 $14,082 $18,494 $11,939 $11,248
9/30/1998 $13,012 $16,654 $12,444 $11,384
12/31/1998 $14,315 $20,201 $12,486 $11,506
3/31/1999 $14,310 $21,209 $12,424 $11,633
6/30/1999 $15,133 $22,707 $12,315 $11,764
9/30/1999 $14,912 $21,287 $12,398 $11,901
12/31/1999 $17,504 $24,455 $12,383 $12,052
3/31/2000 $18,493 $25,015 $12,657 $12,220
5/31/2000 $17,404 $23,764 $12,615 $12,337
$10,000 investment made 2/29/96
The graph at left shows the growth of a $10,000 investment over the life of the
fund, while the graph below shows the fund's year-by-year performance. The S&P
500, Lehman Aggregate Bond, and Three-Month U.S. Treasury Bill (T-Bill) indices
are provided for comparison in each graph. Strategic Moderate's total returns
include operating expenses (such as transaction costs and management fees) that
reduce returns, while the total returns of the indices do not. The graphs are
based on Investor Class shares only; performance for other classes will vary due
to differences in fee structures (see the Total Returns table above). Past
performance does not guarantee future results. Investment return and principal
value will fluctuate, and redemption value may be more or less than original
cost.
[bar graph - data below]
ONE-YEAR RETURNS OVER LIFE OF FUND (PERIODS ENDED MAY 31)
Strategic Lehman 3-Month
Moderate S&P 500 Aggregate T-Bill
DATE RETURN RETURN RETURN RETURN
5/31/96* 3.94% 5.04% -1.45% 1.25%
5/31/97 10.92% 29.48% 8.32% 5.17%
5/31/98 20.24% 30.68% 10.91% 5.16%
5/31/99 5.76% 21.04% 4.35% 4.62%
5/31/00 18.70% 10.48% 2.11% 5.26%
* From 2/29/96 (the date nearest the class's inception for which index data are
available) to 5/31/96.
18 1-800-345-2021
Strategic Moderate--Q&A
--------------------------------------------------------------------------------
An interview with Jeff Tyler and Brian Howell (pictured on page 6),
portfolio managers on the American Century Strategic Asset Allocation funds
management team.
HOW DID STRATEGIC MODERATE PERFORM DURING THE SIX MONTHS ENDED MAY 31, 2000?
The fund's performance was fairly strong and reflected its balanced
portfolio. For the six-month period, Strategic Moderate posted a total return of
7.71%.* (See the previous page for other fund performance information.)
THE FUND COMFORTABLY OUTPERFORMED THE S&P 500 (AS SHOWN ON THE PREVIOUS PAGE).
HOW DID THAT HAPPEN?
In part, we made some good asset allocation decisions. We usually make
modest adjustments to Strategic Moderate's neutral asset mix of 60% stocks, 30%
bonds, and 10% cash. During the first half of the period, we were overweight
stocks and underweight cash, which proved to be good for fund performance.
We also made some timely decisions within our stock and bond holdings that
enhanced the fund's return.
LET'S START WITH STOCKS. WHAT CHANGES DID YOU MAKE TO THIS PART OF THE
PORTFOLIO?
We began the period with a heavy overweight in small- and mid-cap U.S.
stocks. We've started to look at the small- and mid-cap sectors as a single
entity, and we felt that the best investment opportunities were in this part of
the market. This was a major reason why the fund performed so well--small- and
mid-cap stocks outperformed large-caps by a pretty wide margin during the period
(see the table on page 3).
But, as we mentioned in our annual report six months ago, we were
considering cutting back on our equity overweight after Y2K, and that's exactly
what we did. We began to gradually pare back our stock holdings in early 2000,
and by the end of the period we had brought the domestic stock portfolio back to
a neutral position.
CAN YOU GIVE SOME EXAMPLES OF STOCKS THAT HAD THE MOST SIGNIFICANT IMPACT ON
FUND PERFORMANCE?
Despite their volatility, technology stocks were the fund's best
performers. In particular, semiconductor companies were consistently strong and
even held up reasonably well when most tech stocks went into a tailspin in April
and May.
Electrical equipment companies--the fund's biggest industry holding--also
boosted fund performance, especially firms that manufacture components for
fiber-optic networks and wireless communications.
On the negative side, financial stocks, especially banks, were the
portfolio's weakest performers. Rising interest rates led to reduced lending
activity, and that in turn squeezed profit margins at many banks. Banks were
one of the portfolio's largest industry holdings, so they had a sizable impact
on fund performance.
LET'S SHIFT TO STRATEGIC MODERATE'S BOND PORTFOLIO. HOW WAS IT POSITIONED?
We did some rebalancing during the past six months to bring the bond
portion more in line with the sector weightings of the Lehman Aggregate Bond
Index. That meant cutting back a little on our corporate bond holdings and
adding more Treasury and government agency securities.
* All fund returns referenced in this interview are for Investor Class shares.
[right margin]
"A MAJOR REASON WHY THE FUND PERFORMED SO WELL WAS OUR HEAVY OVERWEIGHT IN
SMALL- AND MID-CAP U.S. STOCKS, WHICH OUTPERFORMED LARGE-CAPS BY A PRETTY WIDE
MARGIN."
[pie chart - data below]
ASSET ALLOCATION
% OF FUND INVESTMENTS
AS OF MAY 31, 2000
U.S. STOCKS 44%
U.S. BONDS 31%
FOREIGN STOCKS 14%
MONEY MARKET SECURITIES 11%
See page 63 for the fund's neutral asset mix.
Investment terms are defined in the Glossary on pages 64-65.
www.americancentury.com 19
Strategic Moderate--Q&A
--------------------------------------------------------------------------------
(Continued)
Treasury bonds performed very well during the period, so we extended the
duration (a measure of price volatility as interest rates change) of our
Treasury holdings to take greater advantage of their price gains. To keep our
overall duration in line with that of the Lehman index, we shortened the
duration of our other holdings.
We also adopted a slightly more conservative position by reducing our
holdings of lower-rated corporate bonds. With the Fed raising interest rates to
slow the economy, we preferred to own high-quality bonds issued by stable,
well-known companies.
THE FUND NO LONGER OWNS ANY FOREIGN BONDS. WHY THE CHANGE?
As of the first of the year, we eliminated the fund's strategic weighting in
foreign bonds, which was typically around 5% of the portfolio. We found that
this slice of the portfolio increased the fund's overall risk level without a
measurable increase in performance. In other words, all it was giving us was
extra volatility, and that's the opposite of what a diversified fund like
Strategic Moderate is all about.
We may still invest in foreign bonds from time to time when we see attractive
opportunities, but it would likely be a very small part of the portfolio.
WHAT ABOUT THE FUND'S FOREIGN STOCK HOLDINGS?
The changes we made followed the same pattern as for the domestic stock
portion. We were heavily overweight in foreign stocks coming into 2000, but then
we pared back to a more neutral position over the last few months.
In addition, we reduced our Japanese stock holdings and shifted some of those
assets back into Europe. Many of our Japanese stocks performed very well in
1999, and we felt it prudent to trim our holdings, especially with the economic
pendulum swinging back toward weakness in early 2000.
Unlike six months ago, when many of our biggest foreign holdings were in
Japan, the portfolio is now focused more on companies in Europe and Canada.
LOOKING AHEAD, WHAT ARE YOUR PLANS FOR STRATEGIC MODERATE'S ASSET ALLOCATION
STRUCTURE?
As usual, we'll keep it close to the neutral asset mix of 60% stocks, 30%
bonds, and 10% cash to stay true to the fund's long-term investment goals.
Since the end of the period, however, we've been reducing the portfolio's
cash position a little and moving back to an overweight in stocks.
[left margin]
FUND'S U.S. STOCKS
AS OF MAY 31, 2000
NUMBER OF COMPANIES 287
DIVIDEND YIELD 1.4%
PRICE/EARNINGS RATIO 21.4
TOP 5 U.S. STOCKS
% OF FUND'S % OF
U.S. STOCKS FUND
VIACOM, INC. CI B 1.0% 0.4%
HCA-THE HEALTHCARE CORP. 0.9% 0.4%
INTERNATIONAL BUSINESS
MACHINES CORP. 0.9% 0.4%
SBC COMMUNICATIONS INC. 0.9% 0.4%
EMERSON ELECTRIC CO. 0.9% 0.4%
FUND'S FOREIGN STOCKS
AS OF MAY 31, 2000
NUMBER OF COMPANIES 198
DIVIDEND YIELD 0.9%
TOP 5 FOREIGN STOCKS
% OF FUND'S % OF
COUNTRY FOREIGN STOCKS FUND
ROYAL DUTCH
PETROLEUM CO.
NEW YORK SHARES NETHERLANDS 2.8% 0.4%
VODAFONE AIRTOUCH
PLC ORD U.K. 2.3% 0.3%
SAMSUNG
ELECTRONICS ORD SOUTH KOREA 1.9% 0.3%
SKANDIA FORSAKRINGS
AB ORD SWEDEN 1.9% 0.3%
BP AMOCO PLC ADR U.K. 1.6% 0.2%
[pie chart - data below]
% OF FUND'S FOREIGN STOCKS
EUROPE 64%
ASIA/PACIFIC 22%
AMERICAS (EXCLUDING U.S.) 14%
20 1-800-345-2021
Strategic Moderate--Q&A
--------------------------------------------------------------------------------
(Continued)
WHAT'S THE ATTRACTION OF STOCKS RIGHT NOW?
We think that the stock market is in a better position after weathering a
period of economic uncertainty. While we certainly don't expect to see the 25%
annual returns that the S&P 500 posted over the past five years, we do expect
greater stability and returns more in line with corporate earnings growth as we
move forward.
That said, we also believe that we're closer to the beginning than the end
of the shakeout among technology companies, and we're not sure how that will
ultimately play out.
CAN YOU TALK A LITTLE BIT MORE ABOUT THIS SHAKEOUT?
The decline in technology shares over the past few months has taken some of
the air out of the New Economy balloon, and investors are starting to take a
harder look at the long-term business plans and profitability of their
technology investments.
Prior to this year, venture capital for technology start-ups flowed freely,
and tech firms were going public at a rate of several per week. In the past six
months, however, the market for initial public offerings has dried up, and
venture capital has become increasingly hard to get.
As the tech sector continues to evolve, we expect to see a great deal of
consolidation. A large number of companies that were built on promises and
little else will likely be bought out or disappear completely. In the end,
though, we expect the survivors to be stronger and in a better position to be
successful and profitable companies over the long term.
WILL THIS HAVE ANY EFFECT ON YOUR INVESTMENT STRATEGY GOING FORWARD?
It won't change the way we look at technology stocks or equity investing in
general. Our stock portfolio managers have always emphasized high-quality
companies, whether they're technology-oriented firms or industrial
manufacturers. We'll continue to invest in technology companies that meet our
stringent investment guidelines.
These standards also extend to our foreign stock holdings. Our foreign
equity managers are constantly monitoring technological developments overseas.
For example, wireless telecommunications are used to a much greater extent in
Europe and Japan than they are in the U.S. This heavy usage has created a class
of companies at the forefront of mobile computing and communication. We're
investing in the best of these companies because they will be the most likely to
benefit from the millions of people who shop, trade securities, do banking, and
book flights using only their mobile phones.
HOW WILL YOU POSITION THE PORTFOLIO'S BOND HOLDINGS GOING FORWARD?
We intend to maintain our current neutral position in bonds. We're starting
to see evidence that the U.S. economy is slowing down, and that probably means
the Fed is finished raising interest rates for the time being. Although
inflation is higher than it has been in the past couple of years, it's still low
on a historical basis. These factors are generally positive for bonds.
We still favor a longer duration in our Treasury bond holdings and an
overweight in corporate bonds. However, we'll be keeping a close eye on the
credit quality of our corporate holdings, sticking with those that we think can
remain financially sound during an economic slowdown.
[right margin]
"SINCE THE END OF THE PERIOD, WE'VE BEEN REDUCING THE PORTFOLIO'S CASH POSITION
A LITTLE AND MOVING BACK TO AN OVERWEIGHT IN STOCKS."
FUND'S U.S. BONDS
AS OF MAY 31, 2000
NUMBER OF SECURITIES 155
WEIGHTED AVERAGE MATURITY 8.1 YRS
AVERAGE DURATION 5.1 YRS
[pie chart - data below]
% OF FUND'S U.S. BONDS
CORPORATE SECURITIES 30%
U.S. TREASURY SECURITIES 26%
MORTGAGE-BACKED SECURITIES 22%
U.S. GOVT. AGENCY SECURITIES 17%
ASSET-BACKED SECURITIES 4%
OTHER 1%
www.americancentury.com 21
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
COMMON STOCKS -- 57.7%
ALCOHOL -- 0.1%
7,700 A-Ahram Beverages Co. GDR
(Acquired 4/14/00-4/17/00,
Cost $139,486)(1)(2) $ 136,868
3,300 Anheuser-Busch Companies, Inc. 255,750
6,800 Hite Brewery Co., Ltd. ORD(1) 219,743
------------
612,361
------------
APPAREL & TEXTILES -- 0.1%
88,000 Far Eastern Textile Ltd. ORD 142,811
2,200 Kenneth Cole Productions,
Inc. Cl A(1) 73,562
8,000 Liz Claiborne, Inc. 314,500
------------
530,873
------------
BANKS -- 5.1%
195,870 African Bank Investments
Limited ORD(1) 394,260
3,450 Alpha Credit Bank ORD 146,398
116,517 Banca Intesa S.p.A. ORD 460,929
22,200 Banco Rio de la Plata S.A.
Cl B ORD 146,098
58,600 Bank of America Corp. 3,255,972
11,000 Barclays PLC ORD 286,533
22,600 Chase Manhattan Corp. 1,687,938
35,300 Citigroup Inc. 2,195,219
40,300 First Union Corp. 1,418,056
71,100 First Virginia Banks, Inc. 2,821,781
7,000 Fleet Boston Financial Corp. 264,688
375,000 Grupo Financiero Bancomer, S.A.
de C.V. Cl O ORD(1) 191,357
177,000 Grupo Financiero Banorte S.A.
de C.V. Cl O ORD(1) 242,096
14,421 ICICI Bank Ltd. ADR(1) 221,723
108,700 KeyCorp 2,282,700
6,800 Komercni Banka a.s. ORD(1) 146,796
45,967 Nordic Baltic Holding AB ORD 305,141
8,000 Old Kent Financial Corp. 266,000
15,300 PNC Bank Corp. 770,738
8,300 Societe Generale Cl A ORD 480,090
115,900 Summit Bancorp. 3,324,881
17,100 UnionBanCal Corp. 585,675
13,500 Wachovia Corp. 933,188
28,580,750 Yapi ve Kredi Bankasi A.S. ORD 352,818
------------
23,181,075
------------
CHEMICALS -- 1.2%
7,100 BorsodChem Rt. ORD 235,583
10,200 Dow Chemical Co. 1,092,038
14,800 du Pont (E.I.) de Nemours & Co. 725,200
28,700 Minnesota Mining &
Manufacturing Co. 2,461,025
Shares Value
--------------------------------------------------------------------------------
1,700 Pannonplast Rt. ORD $ 38,320
18,600 Praxair, Inc. 781,200
------------
5,333,366
------------
CLOTHING STORES(3)
4,800 Gadzooks, Inc.(1) 68,400
------------
COMPUTER HARDWARE &
BUSINESS MACHINES -- 1.7%
800 Adaptec, Inc.(1) 15,775
3,000 Apple Computer, Inc.(1) 252,094
15,000 Asustek Computer Inc. ORD 151,412
27,100 Dell Computer Corp.(1) 1,169,534
17,300 EMC Corp. (Mass.)(1) 2,012,206
9,100 Hewlett-Packard Co. 1,093,138
29,000 Hon Hai Precision Industry ORD(1) 265,433
5,600 Network Appliances, Inc.(1) 361,375
2,800 Network Peripherals, Inc.(1) 49,788
2,200 Proxim, Inc.(1) 192,019
3,800 Sanmina Corp.(1) 241,894
12,900 Sun Microsystems, Inc.(1) 988,059
30,500 Xerox Corp. 827,312
------------
7,620,039
------------
COMPUTER SOFTWARE -- 2.7%
3,900 Amdocs Ltd.(1) 241,556
1,200 AudioCodes Ltd.(1) 87,638
8,500 Autodesk, Inc. 314,766
2,300 Business Objects S.A. ADR(1) 184,000
5,200 Check Point Software
Technologies Ltd.(1) 977,275
5,400 Computer Associates
International, Inc. 278,100
17,000 International Business Machines
Corp. 1,824,312
911 Intershop Communications
AG ORD 369,754
74,000 Ixchange Technology Holdings
Limited ORD(1) 143,633
2,000 Lernout & Hauspie Speech
Products N.V.(1) 83,688
11,100 Logica plc ORD 297,451
43,700 Microsoft Corp.(1)(4) 2,732,616
34,600 Misys plc ORD 299,044
5,400 National Instruments Corp.(1) 195,581
6,600 Objective Systems Integrators, Inc.(1) 48,572
9,700 ONYX Software Corp.(1) 165,809
35,800 Oracle Corp.(1) 2,570,888
1,700 SAP AG ADR 72,888
5,735 Softbank S.A. ORD 237,490
185,000 Softline Limited ORD(1) 183,530
4,700 Tieto Corp. Cl B ORD 184,169
7,400 Veritas Software Corp.(1) 861,869
------------
12,354,629
------------
CONSTRUCTION & REAL PROPERTY -- 0.2%
58,000 Cemex SA de CV Cl A ORD 245,926
1,100 Mastec, Inc.(1) 75,212
22 1-800-345-2021 See Notes to Financial Statements
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
34,006 Mostostal Zabrze - Holding S.A.
ORD $ 100,200
70,000 President Chain Store Corp. ORD 269,231
3,400 Quanta Services, Inc.(1) 166,600
------------
857,169
------------
CONSUMER DURABLES -- 0.3%
15,800 Pier 1 Imports, Inc. 134,300
6,000 PIONEER CORP. ORD 182,964
22,000 Sharp Corporation ORD 395,588
259 Swatch Group AG (The) Cl B ORD 317,900
5,700 Whirlpool Corp. 323,119
------------
1,353,871
------------
DEFENSE/AEROSPACE -- 0.6%
35,700 Boeing Co. 1,394,531
41,200 Lockheed Martin Corp. 1,009,400
1,000 Northrop Grumman Corp. 76,625
14,200 Raytheon Co. Cl B 332,812
------------
2,813,368
------------
DEPARTMENT STORES -- 1.0%
16,100 Ames Department Stores, Inc.(1) 190,684
4,300 Federated Department Stores,
Inc.(1) 165,550
17,100 May Department Stores Co. (The) 514,069
2,100 Pinault-Printemps-Redoute SA
ORD 453,076
6,100 Sears, Roebuck & Co. 225,319
95,000 Wal-Mart de Mexico SA de CV
Series V ORD(1) 195,907
46,800 Wal-Mart Stores, Inc. 2,696,850
------------
4,441,455
------------
DRUGS -- 3.1%
4,300 American Home Products Corp. 231,662
13,600 Amgen Inc.(1) 865,725
2,800 Aventis SA ORD 182,514
3,300 Biogen, Inc.(1) 179,747
27,700 Bristol-Myers Squibb Co. 1,525,231
3,100 Diversa Corp.(1) 67,812
11,800 Enzon, Inc.(1) 340,356
3,600 ILEX Oncology, Inc.(1) 89,888
6,400 IVAX Corp.(1) 240,800
6,300 Jones Pharma Inc. 229,753
1,400 MedImmune, Inc.(1) 217,481
6,600 Merck & Co., Inc. 492,525
302 Novartis AG ORD 446,969
3,786 Novo Nordisk A/S Cl B ORD 628,415
50,000 Pfizer, Inc. 2,228,125
7,000 Protein Design Labs, Inc.(1) 746,594
1,800 QLT PhotoTherapeutics Inc.(1) 88,200
3,173 Richter Gedeon Rt. ORD 186,475
26,900 Schering-Plough Corp. 1,301,288
4,000 Takeda Chemical Industries,
Ltd. ORD 272,500
5,900 Tanox, Inc.(1) 298,134
Shares Value
--------------------------------------------------------------------------------
4,300 Titan Pharmaceuticals, Inc.(1) $ 109,112
23,600 Warner-Lambert Co. 2,882,150
------------
13,851,456
------------
ELECTRICAL EQUIPMENT -- 6.4%
2,500 ADTRAN, Inc.(1) 154,141
4,700 Advanced Energy Industries, Inc.(1) 173,312
13,230 Alcatel Alsthom Compagnie
Generale ORD 733,701
6,600 ANTEC Corp.(1) 330,825
4,600 AVX Technology 263,638
10,300 Celestica Inc.(1) 479,594
5,800 CIENA Corp.(1) 694,369
83,300 Cisco Systems Inc.(1)(4) 4,740,291
7,700 Comverse Technology, Inc.(1) 703,828
4,300 Corning Inc. 831,781
3,000 Credence Systems Corp.(1) 163,875
12,100 Digital Microwave Corp.(1) 337,666
1,900 E-Tek Dynamics, Inc.(1) 349,422
125,300 Eastern Communications Co., Ltd.
Cl B ORD 124,298
38,800 Ericsson (L.M.) Telephone Co.
ADR 794,188
12,397 Flextronics International Ltd.
ADR(1) 674,474
1,300 Gilat Satellite Networks Ltd.(1) 105,097
14,900 Glenayre Technologies, Inc.(1) 122,459
4,400 Harmonic Inc.(1) 196,488
42,000 Hitachi Ltd. ORD 519,307
3,400 Integrated Circuit Systems, Inc.(1) 41,225
39,510 JDS Uniphase Corp.(1) 3,476,880
5,500 KEMET Corp.(1) 369,531
300 Keyence Corporation ORD 89,675
6,500 KLA-Tencor Corporation(1) 321,953
3,800 Motorola, Inc. 356,250
18,500 Nokia Corp. Cl A ADR 962,000
36,800 Nortel Networks Corp. 1,998,700
2,300 Orbotech Ltd.(1) 194,638
22,032 Phillips Electronics N.V. New
York Shares 973,539
43,200 Pinnacle Systems, Inc.(1) 1,032,750
15,300 Powerwave Technologies, Inc.(1) 828,591
200 Sagem SA New Shares ORD 235,483
4,589 Samsung Electronics ORD 1,251,361
7,900 Scientific-Atlanta, Inc. 445,362
5,900 Sensormatic Electronics Corp.(1) 92,556
5,200 Siemens AG ORD 764,519
2,700 Sony Corp. ORD 243,999
13,400 Tekelec, Inc.(1) 441,362
3,000 Tokyo Electron Ltd. ORD 408,750
7,700 Tollgrade Communications, Inc.(1) 509,644
59,000 Toshiba Corp. ORD 568,727
4,700 UTStarcom Inc.(1) 180,656
7,800 Vishay Intertechnology, Inc.(1) 551,850
12,400 Westell Technologies, Inc.(1) 204,988
------------
29,037,743
------------
See Notes to Financial Statements www.americancentury.com 23
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
ELECTRICAL UTILITIES -- 1.4%
4,800 AES Corp. (The)(1) $ 418,800
10,800 Calpine Corp.(1) 1,144,125
18,456,000 Companhia de Transmissao de
Energia Eletrica Paulista ORD(1) 73,946
5,207,000 Empresa Paulista de Transmissao
de Energia SA ORD 41,039
14,100 Florida Progress Corp. 699,712
54,200 FPL Group, Inc. 2,682,900
23,500 Niagara Mohawk Holdings Inc.(1) 345,156
11,800 Public Service Enterprise Group Inc. 439,550
13,900 Reliant Energy, Inc. 396,150
13,100 Utilicorp United Inc. 257,088
------------
6,498,466
------------
ENERGY RESERVES & PRODUCTION -- 3.0%
21,400 Amerada Hess Corp. 1,420,425
13,300 Apache Corp. 809,638
18,700 BP Amoco Plc ADR 1,016,812
15,300 Burlington Resources Inc. 699,975
22,200 Chevron Corp. 2,052,112
27,900 Exxon Mobil Corp. 2,324,419
22,500 Kerr-McGee Corp. 1,342,969
3,300 Lukoil Holding ADR 182,325
13,500 Murphy Oil Corp. 875,812
28,500 Royal Dutch Petroleum Co.
New York Shares 1,779,469
13,400 Surgutneftegaz ADR(1) 193,462
14,500 Triton Energy Ltd.(1) 483,938
15,300 Union Pacific Resources 362,419
------------
13,543,775
------------
ENTERTAINMENT -- 0.5%
76,900 Corporacion Interamericana de
Entretenimiento S.A.
Cl B ORD(1) 306,645
30,506 Viacom, Inc. Cl B(1) 1,891,372
------------
2,198,017
------------
EQUITY REAL ESTATE INVESTMENT
TRUST -- 0.1%
5,600 Pinnacle Holdings Inc.(1) 274,225
------------
FINANCIAL SERVICES -- 2.4%
8,400 American Express Co. 452,025
138,000 China Development Industrial
Bank ORD(1) 210,516
11,000 Coronation Holdings Limited ORD 176,500
11,100 Countrywide Credit Industries, Inc. 341,325
3,300 Credit Suisse Group ORD 617,867
14,600 Fannie Mae 877,825
6,600 Federal Home Loan Mortgage
Corporation 293,700
86,600 General Electric Co. (U.S.) 4,557,325
6,173 ING Groep N.V. ORD 370,106
106 Julius Baer Holding AG ORD 381,182
800 Marschollek Lautenschlaeger und
Partner AG ORD 282,056
Shares Value
--------------------------------------------------------------------------------
6,400 Marsh & McLennan Companies,
Inc. $ 704,400
3,700 Providian Financial Corp. 329,069
48,200 Skandia Forsakrings AB ORD 1,236,835
------------
10,830,731
------------
FOOD & BEVERAGE -- 1.6%
127,358 Archer-Daniels-Midland Co. 1,520,336
31,381 Diageo plc ORD 268,872
13,900 Hartwall Oyj Abp ORD 219,688
19,200 IBP, Inc. 316,800
105,200 Interstate Bakeries Corp. 1,525,400
18,700 PepsiCo, Inc. 760,856
14,300 Quaker Oats Co. (The) 1,051,944
9,700 Suiza Foods Corp.(1) 435,288
126,600 Tyson Foods, Inc. Cl A 1,250,175
------------
7,349,359
------------
FOREST PRODUCTS & PAPER -- 0.3%
8,600 Aracruz Celulose S.A. ADR 144,050
600 Chesapeake Corp. 19,612
8,858 International Paper Co. 308,369
3,400 Temple-Inland Inc. 168,938
5,850,000 Votorantim Celulose e Papel
SA ORD 186,224
7,600 Weyerhaeuser Co. 377,150
------------
1,204,343
------------
GAS & WATER UTILITIES -- 0.8%
71,600 AGL Resources Inc. 1,190,350
155,520 Centrica plc ORD 563,747
4,200 Kinder Morgan, Inc. 137,025
4,000 Suez Lyonnaise des Eaux ORD 673,344
43,300 Washington Gas Light Co. 1,152,862
------------
3,717,328
------------
GOLD -- 0.1%
17,700 Barrick Gold Corp. 319,706
------------
GROCERY STORES -- 0.1%
7,000 Grupo Gigante SA de CV ORD 10,679
7,500 Safeway Inc.(1) 345,938
------------
356,617
------------
HEAVY ELECTRICAL EQUIPMENT -- 1.0%
6,255 ABB Ltd. ORD(1) 778,901
1,100 C&D Technologies, Inc. 79,750
9,000 CommScope, Inc.(1) 347,625
38,300 Cooper Industries, Inc. 1,283,050
6,200 Cummins Engine Company, Inc. 201,888
29,700 Emerson Electric Co. 1,752,300
------------
4,443,514
------------
HEAVY MACHINERY(3)
3,800 Atlas Copco AB Cl A ORD 81,823
2,630 Atlas Copco AB Cl B ORD 58,684
------------
140,507
------------
24 1-800-345-2021 See Notes to Financial Statements
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
HOME PRODUCTS -- 0.3%
7,300 Avon Products, Inc. $ 301,581
4,900 Colgate-Palmolive Co. 257,862
7,000 Kao Corporation ORD 212,161
5,500 Procter & Gamble Co. (The) 365,750
10,300 Ralston Purina Co. 191,194
11,648,100 Trakya Cam Sanayii A.S. ORD(1) 153,251
------------
1,481,799
------------
HOTELS(3)
12,300 Park Place Entertainment Corp.(1) 155,288
------------
INDUSTRIAL PARTS -- 0.5%
20,176 Assa Abloy AB Cl B ORD(1) 389,420
2,600 Cymer, Inc.(1) 82,144
11,051 Illinois Tool Works Inc. 641,649
10,000 Maillis ORD 139,643
17,000 Tubos de Acero de Mexico,
SA ADR 229,500
3,400 United Technologies Corp. 205,488
21,300 York International Corp. 556,462
------------
2,244,306
------------
INDUSTRIAL SERVICES -- 0.3%
13,200 Capita Group Plc ORD 295,596
16,000 Compass Group PLC ORD 179,508
6,600 Hertz Corp. Cl A 206,662
4,000 ISS A/S ORD(1) 290,628
19,900 Securitas AB Cl B ORD 465,130
------------
1,437,524
------------
INFORMATION SERVICES -- 1.8%
348 Adecco SA ORD 275,521
5,700 Automatic Data Processing, Inc. 313,144
6,400 BISYS Group, Inc. (The)(1) 421,000
651 Cap Gemini SA ORD 122,311
22,400 Ceridian Corp.(1) 540,400
25,200 CMG plc ORD 352,180
7,800 Computer Sciences Corp.(1) 748,312
10,600 Cysive, Inc.(1) 268,975
32,000 Datacraft Asia Limited ORD 222,400
13,200 Diamond Technology Partners
Inc.(1) 835,725
40,000 Dimension Data Holdings Ltd.
ORD(1) 278,926
16,400 Dun & Bradstreet Corp. (The) 504,300
6,800 Electronic Data Systems Corp. 437,325
5,600 eLoyalty Corp.(1) 83,650
12,400 First Data Corp. 695,175
16,500 Getronics N.V. ORD 276,983
39,600 Hays plc ORD 222,438
7,665 Insung Information ORD 100,096
11,500 Proxicom, Inc.(1) 527,203
2,700 Sapient Corp.(1) 269,747
24,300 SEMA Group plc ORD 339,238
Shares Value
--------------------------------------------------------------------------------
4,500 TenFold Corp.(1) $ 78,750
9,500 Valassis Communications, Inc.(1) 313,500
------------
8,227,299
------------
INTERNET -- 0.7%
29,000 America Online Inc.(1) 1,537,000
2,000 Digital Island(1) 36,688
4,700 GlobeSpan, Inc.(1) 415,509
7,000 Portal Software, Inc.(1) 281,531
1,835 Tiscali SpA ORD(1) 91,468
5,000 Verio Inc.(1) 285,312
5,100 Yahoo! Inc.(1) 576,459
------------
3,223,967
------------
LEISURE -- 0.2%
6,100 Eastman Kodak Co. 364,475
15,800 GTECH Holdings Corp.(1) 348,588
3,800 Polaroid Corp. 72,912
------------
785,975
------------
LIFE & HEALTH INSURANCE -- 0.3%
3,900 CIGNA Corp. 346,369
18,500 Lincoln National Corp. 716,875
20,300 Mediolanum SpA ORD 311,347
------------
1,374,591
------------
MEDIA -- 1.7%
16,000 Clear Channel Communications,
Inc.(1) 1,198,000
13,200 Comcast Corp. Cl A(1) 500,362
6,000 Cox Communications, Inc. Cl A(1) 264,750
22,500 Disney (Walt) Co. 949,219
2,912 EM.TV & Merchandising AG ORD 195,669
19 Fuji Television Network, Inc. ORD 288,813
2,200 General Motors Corp. Cl H(1) 216,562
4,900 Grupo Televisa S.A. GDR(1) 272,869
12,600 Infinity Broadcasting Corp. Cl A(1) 398,475
18,538 Mediaset SpA ORD 287,790
3,634 Modern Times Group MTG
AB Cl B ORD(1) 163,188
19,200 Mondadori (Arnoldo) Editore
SpA ORD 442,611
11,600 News Corp. Ltd. (The) ADR 528,525
8,000 Pearson plc ORD 241,581
1,200 Radio One, Inc.(1) 85,950
700 Societe Television
Francaise 1 ORD 451,702
4,033 Sogecable, S.A. ORD(1) 149,735
5,400 TV Azteca SA DE CV ADR 50,962
6,500 UnitedGlobalCom Cl A(1) 311,797
4,100 Univision Communications
Inc. Cl A(1) 422,300
27,700 WPP Group plc ORD 337,329
------------
7,758,189
------------
See Notes to Financial Statements www.americancentury.com 25
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
MEDICAL PRODUCTS & SUPPLIES -- 1.1%
5,000 Aclara BioSciences, Inc.(1) $ 135,156
1,200 ArthroCare Corp.(1) 102,300
700 Aurora Biosciences Corp.(1) 33,184
7,000 Bard (C.R.), Inc. 319,375
13,300 Beckman Coulter Inc. 799,662
8,500 CONMED Corp.(1) 204,797
11,600 Guidant Corp.(1) 587,250
4,000 Hoya Corp. ORD 370,377
11,500 Johnson & Johnson 1,029,250
15,600 Medtronic, Inc. 805,350
2,900 MiniMed Inc.(1) 346,006
1,800 Nanogen, Inc.(1) 44,662
------------
4,777,369
------------
MEDICAL PROVIDERS & SERVICES -- 0.6%
69,500 HCA-The Healthcare Corp.(1) 1,876,500
15,900 Oxford Health Plans, Inc.(1) 338,372
2,600 PacifiCare Health Systems, Inc.(1) 168,512
5,300 United HealthCare Corp. 395,181
------------
2,778,565
------------
MINING & METALS -- 0.4%
8,600 Alcoa Inc. 502,562
950,000 Angang New Steel Co. Ltd.
Cl H ORD 74,366
7,209,000 Companhia Siderurgica Nacional
ORD 235,420
7,500 Companhia Vale do Rio Doce
Cl A ORD 187,294
3,900 Impala Platinum Holdings Limited
ORD 130,425
37,000 Iscor Limited ORD 82,988
13,100 Maverick Tube Corp.(1) 460,547
49,900 Siderca S.A.I.C. ORD 92,828
------------
1,766,430
------------
MOTOR VEHICLES & PARTS -- 0.6%
1,986,400 Brisa Bridgestone Sabanci Lastik
San. Ve Tic A.S. ORD 129,060
19,200 Ford Motor Co. 932,400
2,900 General Motors Corp. 204,812
5,700 North American Bus Industries
Rt. ORD(1) 112,244
33,200 Superior Industries International,
Inc. 927,525
6,000 Toyota Motor Corp. ORD 271,944
------------
2,577,985
------------
MULTI-INDUSTRY -- 0.6%
25,000 Citic Pacific Ltd. ORD 119,025
9,600 Compagnie Financiere Richemont
AG Depositary Receipts ORD(1) 236,851
8,276,200 Dogan Sirketler Grubu Holding
A.S. ORD 191,562
16,899 Elektrim Spolka Akcyjna
S.A. ORD(1) 219,168
43,700 Hutchison Whampoa Limited ORD 504,716
Shares Value
--------------------------------------------------------------------------------
12,600 Tyco International Ltd. $ 592,988
7,909 Vivendi ORD 850,597
------------
2,714,907
------------
OIL REFINING(3)
9,800 Polski Koncern Naftowy SA GDR
(Acquired 5/31/00, Cost
$92,424)(1)(2) 91,875
------------
OIL SERVICES -- 1.0%
9,400 Baker Hughes Inc. 340,750
3,300 BJ Services Co.(1) 236,362
9,700 Ensco International Inc. 338,894
10,000 Global Marine Inc.(1) 283,125
4,400 Grant Prideco, Inc.(1) 102,300
19,900 Key Energy Group, Inc.(1) 216,412
22,800 Marine Drilling Co., Inc.(1) 655,500
9,500 National-Oilwell, Inc.(1) 247,000
5,400 Patterson Energy, Inc.(1) 130,444
12,000 PetroChina Co. Ltd. ADR(1) 241,500
13,900 R&B Falcon Corp.(1) 325,781
16,800 Rowan Companies, Inc.(1) 521,850
2,900 Smith International, Inc.(1) 229,281
9,900 Transocean Sedco Forex, Inc. 486,956
3,700 Weatherford International, Inc.(1) 159,331
------------
4,515,486
------------
PROPERTY & CASUALTY INSURANCE -- 1.8%
3,000 Ace, Ltd.(1) 80,438
30,000 Alleanza Assicurazioni ORD 346,211
25,800 Allstate Corp. 683,700
8,100 Ambac Financial Group, Inc. 408,038
9,100 American International Group, Inc. 1,024,319
3,835 Axa ORD 566,666
23,200 Chubb Corp. (The) 1,624,000
2,200 Everest Reinsurance Holdings, Inc. 74,800
77,500 Horace Mann Educators Corp. 1,317,500
25,900 MGIC Investment Corp. 1,283,669
19,000 Prudential Corporation PLC ORD 287,874
4,200 Radian Group Inc. 231,000
------------
7,928,215
------------
PUBLISHING -- 0.5%
2,503 Altran Technologies SA ORD 564,134
26,300 Banta Corp. 486,550
12,400 Deluxe Corp. 306,125
5,800 Dow Jones & Co., Inc. 394,400
12,500 VNU N.V. ORD 639,443
------------
2,390,652
------------
RAILROADS -- 0.2%
15,400 Union Pacific Corp. 651,612
------------
RESTAURANTS -- 0.1%
7,900 Brinker International, Inc.(1) 223,669
9,800 Jack in the Box Inc.(1) 243,162
------------
466,831
------------
26 1-800-345-2021 See Notes to Financial Statements
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
SECURITIES & ASSET MANAGEMENT -- 0.6%
39,400 Amvescap Plc ORD $ 517,581
853 Consors Discount Broker
AG ORD(1) 79,892
22,000 Morgan Stanley Dean Witter & Co. 1,582,625
20,000 Nomura Securities Co., Ltd. ORD 457,874
------------
2,637,972
------------
SEMICONDUCTOR -- 3.7%
8,100 Applied Materials, Inc.(1) 676,603
2,800 ASM Lithography Holding N.V.
New York Shares(1) 100,012
110,000 ASM Pacific Technology
Limited ORD 389,605
7,300 Asyst Technologies, Inc.(1) 293,597
4,100 Brooks Automation, Inc.(1) 163,488
5,000 Canon, Inc. ORD 229,864
14,400 Cypress Semiconductor Corp.(1) 605,700
14,400 Exar Corp.(1) 988,650
13,540 Hyundai Electronics Industries
Co. ORD(1) 210,982
9,800 Integrated Device Technology, Inc.(1) 466,112
28,400 Intel Corp. 3,542,012
5,000 International Rectifier Corp.(1) 206,250
6,900 Kopin Corp.(1) 488,606
3,100 Kulicke & Soffa Industries, Inc.(1) 156,162
1,800 KYOCERA CORP. ORD 298,304
19,000 Lam Research Corp.(1) 610,969
6,400 Linear Technology Corp. 377,800
5,000 LSI Logic Corp.(1) 263,438
5,600 Maxim Integrated Products, Inc.(1) 355,075
380,900 Music Corporation ORD(1) 45,547
5,700 National Semiconductor Corp.(1) 306,375
4,000 Pericom Semiconductor Corp.(1) 164,000
700 PMC-Sierra, Inc.(1) 107,297
3,800 Power Integrations, Inc.(1) 89,062
7,400 PRI Automation, Inc.(1) 380,406
8,800 REMEC, Inc.(1) 298,650
4,600 SanDisk Corp.(1) 267,806
7,500 Sawtek Inc.(1) 482,109
12,300 STMicroelectronics N.V. New
York Shares 736,462
83,200 Taiwan Semiconductor
Manufacturing Co. Ltd. ORD(1) 423,966
2,600 Teradyne, Inc.(1) 223,600
22,000 Texas Instruments Inc. 1,589,500
126,000 United Microelectronics Corp.
ORD(1) 382,376
86,580 Winbond Electronics Corp. ORD(1) 261,342
6,800 Xilinx, Inc.(1) 517,438
------------
16,699,165
------------
SPECIALTY STORES -- 0.7%
3,300 Best Buy Co., Inc.(1) 211,200
9,720 Folli-Follie Abee ORD 214,663
6,500 Hennes & Mauritz AB Cl B ORD 164,618
35,300 Home Depot, Inc. 1,723,081
Shares Value
--------------------------------------------------------------------------------
7,500 NBTY, Inc.(1) $ 119,766
61,800 Office Depot, Inc.(1) 436,462
69,600 Profurn Limited ORD 38,026
1,200 Ryohin Keikaku Co. Limited ORD 174,511
6,000 Zale Corp.(1) 228,000
------------
3,310,327
------------
TELEPHONE -- 4.0%
32,100 AT&T Corp. 1,113,469
9,500 Bell Atlantic Corp. 502,312
29,300 BellSouth Corp. 1,367,944
11,800 Century Telephone Enterprises, Inc. 318,600
7,646 COLT Telecom Group plc ORD(1) 270,175
3,400 Covad Communications Group,
Inc.(1) 80,856
12,100 Embratel Participacoes S.A. ADR 253,344
5,867 Energis plc ORD(1) 223,220
53,500 GTE Corp. 3,383,875
7 Japan Telecom Co. Ltd. ORD 306,887
14,400 McLeodUSA Inc. Cl A(1) 288,450
5,100 NEXTLINK Communications,
Inc. Cl A(1) 357,478
1,681 NTL Inc.(1) 99,389
12,400 Rostelecom ADR 188,325
41,500 SBC Communications Inc. 1,813,031
3,100 SK Telecom Co., Ltd. ADR 124,194
800 SK Telecom Co., Ltd. ORD 272,687
13,430 Sonera Group Oyj ORD 681,994
58,300 Sprint Corp. 3,527,150
3,400 Tele Danmark A/S ORD 240,645
35,100 Telecom Italia SpA ORD 485,818
38,512 Telefonica S.A. ORD(1) 792,361
15,200 Telefonos de Mexico, S.A.
Cl L ADR 740,050
32,900 Telekomunikacja Polska S.A.
ORD (Acquired 2/17/00, Cost
$284,585)(2) 231,122
43,663 TeleWest Communications plc
ORD(1) 177,896
2,800 U S WEST, Inc. 201,601
4,518 United Pan-Europe
Communications NV ORD(1) 117,335
13,300 Magyar Tavkozlesi Rt. ORD(1) 92,338
------------
18,252,546
------------
TOBACCO -- 0.3%
67,500 UST Inc. 1,122,188
------------
WIRELESS TELECOMMUNICATIONS -- 1.9%
19,000 Advanced Info Service Public Co.
Limited ORD(1) 218,251
7,200 ALLTEL Corp. 471,150
3,500 Audiovox Corp. Cl A(1) 66,172
36,184 Cable & Wireless plc ORD 604,330
108,000 China Telecom (Hong Kong)
Ltd. ORD(1) 807,315
5,184 Egyptian Mobile Phone Network
ORD(1) 212,970
See Notes to Financial Statements www.americancentury.com 27
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares/Principal Amount Value
--------------------------------------------------------------------------------
1,800 Golden Telecom Inc.(1) $ 53,944
19,000 Grupo Iusacell S.A. de C.V.
Series L ADR(1) 251,750
3,330 Korea Telecom Corporation ORD 247,649
23,600 LCC International, Inc. Cl A(1) 348,838
4,224 NetCom Systems AB Cl B ORD(1) 299,250
2,300 Nextel Communications, Inc.(1) 212,966
12 NTT Mobile Communications
Network, Inc. ORD 309,204
22,500 QUALCOMM Inc.(1) 1,492,734
18,400 Sprint PCS(1) 1,021,200
13,800 Tele Centro Oeste Celular
Participacoes SA ADR 140,588
13,471 Telecel-Comunicacaoes Pessoais,
SA ORD 219,207
3,900 Telekomunikacja Polska S.A.
ORD(1) 27,420
5,400 Videsh Sanchar Nigam Ltd. GDR(1) 84,375
330,738 Vodafone AirTouch PLC ORD 1,511,008
------------
8,600,321
------------
TOTAL COMMON STOCKS 260,903,777
------------
(Cost $214,894,764)
PREFERRED STOCKS & RIGHTS -- 0.5%
BANKS -- 0.1%
46,000,000 Banco Bradesco SA ORD 311,800
------------
MINING & METALS -- 0.1%
53,000 Usinas Siderurgicas de Minas
Gerais S.A. Cl A ORD 232,711
------------
OIL SERVICES -- 0.2%
4,240,000 Petroleo Brasileiro S.A. ORD 989,023
------------
TELEPHONE -- 0.1%
15,090,586 Tele Norte Leste Participacoes
S.A. ORD 298,167
24,148 Tele Norte Leste Participacoes
S.A. Rights ORD(1) 76
------------
298,243
------------
WIRELESS TELECOMMUNICATIONS(3)
31,400,000 Telemig Celular Participacoes
SA ORD 91,339
------------
TOTAL PREFERRED STOCKS & RIGHTS 1,923,116
------------
(Cost $1,994,881)
U.S. TREASURY SECURITIES -- 8.1%
$6,700,000 U.S. Treasury Notes, 6.00%,
8/15/00 6,702,097
3,900,000 U.S. Treasury Notes, 4.875%,
3/31/01 3,843,938
1,925,000 U.S. Treasury Notes, 6.625%,
7/31/01 1,922,594
Principal Amount Value
--------------------------------------------------------------------------------
$4,400,000 U.S. Treasury Notes, 6.375%,
1/31/02 $ 4,373,877
2,000,000 U.S. Treasury Notes, 5.25%,
5/15/04 1,906,876
1,500,000 U.S. Treasury Notes, 5.875%,
11/15/04 1,459,220
500,000 U.S. Treasury Notes, 5.50%,
5/15/09 470,000
2,950,000 U.S. Treasury Bonds, 9.25%,
2/15/16 3,762,173
1,950,000 U.S. Treasury Bonds, 8.75%,
5/15/17 2,413,125
5,450,000 U.S. Treasury Bonds, 7.875%,
2/15/21 6,373,094
800,000 U.S. Treasury Bonds, 6.125%,
11/15/27 784,000
2,500,000 U.S. Treasury Bonds, 6.25%,
5/15/30 2,579,688
------------
TOTAL U.S. TREASURY SECURITIES 36,590,682
------------
(Cost $36,574,003)
U.S. GOVERNMENT AGENCY SECURITIES -- 4.2%
1,700,000 FHLMC MTN, 6.50%, 1/19/01 1,694,268
1,000,000 FNMA, 7.25%, 5/25/01 1,001,376
3,600,000 FNMA, 5.25%, 1/15/03 3,426,631
2,900,000 FNMA, 7.125%, 2/15/05 2,871,438
950,000 FNMA, 7.125%, 1/15/30 926,012
4,800,000 FNMA, Series B, 7.25%,
1/15/10 4,726,906
3,300,000 FNMA MTN, 6.23%, 7/21/08 3,014,072
1,500,000 SLMA MTN, VRN, 6.49%,
6/6/00, resets weekly off the
3-month T-Bill rate plus 0.60%
with no caps 1,500,147
------------
TOTAL U.S. GOVERNMENT
AGENCY SECURITIES 19,160,850
------------
(Cost $19,600,306)
U.S. GOVERNMENT AGENCY DISCOUNT NOTES(5) -- 1.1%
5,000,000 FNMA Discount Notes, 6.52%,
8/17/00 4,930,695
------------
(Cost $4,930,272)
SOVEREIGN GOVERNMENTS & AGENCIES -- 0.4%
1,500,000 Province of Quebec, 5.75%,
2/15/09 1,313,079
600,000 Province of Quebec, 7.50%,
9/15/29 573,050
------------
TOTAL SOVEREIGN GOVERNMENTS
& AGENCIES 1,886,129
------------
(Cost $1,892,752)
28 1-800-345-2021 See Notes to Financial Statements
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
MORTGAGE-BACKED SECURITIES(6) -- 6.2%
$ 198,738 FHLMC Pool #E68523, 6.50%,
12/1/12 $ 189,332
723,918 FHLMC Pool #E00724, 7.00%,
6/1/14 701,362
39,924 FHLMC Pool #C00465, 8.00%,
6/1/26 39,749
162,039 FHLMC Pool #D72306, 8.00%,
6/1/26 161,328
70,947 FHLMC Pool #D72431, 8.00%,
6/1/26 70,636
102,208 FHLMC Pool #D72499, 8.00%,
7/1/26 101,760
488,804 FHLMC Pool #C30257, 7.00%,
8/1/29 464,740
2,655,735 FHLMC Pool #C30060, 7.50%,
8/1/29 2,585,360
648,740 FNMA Pool #373899, 6.50%,
3/1/12 617,845
117,088 FNMA Pool #125477, 6.50%,
4/1/12 111,512
543,451 FNMA Pool #369085, 6.50%,
4/1/12 517,570
30,892 FNMA Pool #377181, 6.50%,
4/1/12 29,421
317,052 FNMA Pool #377379, 6.50%,
4/1/12 301,953
716,343 FNMA Pool #453124, 6.00%,
12/1/13 667,236
700,000 FNMA REMIC, Series 1997-58,
Class PB PAC, 6.50%, 6/18/24 654,378
139,992 FNMA Pool #341078, 7.00%,
5/1/26 133,389
232,601 FNMA Pool #250576, 7.00%,
6/1/26 221,629
424,748 FNMA Pool #373510, 7.50%,
3/1/27 413,692
945,721 FNMA Pool #412562, 6.50%,
1/1/28 877,368
982,204 FNMA Pool #492315, 6.50%,
4/1/29 909,523
3,444,936 FNMA Pool #492740, 6.00%,
5/1/29 3,095,709
999,901 FNMA Pool #448031, 6.50%,
6/1/29 925,910
1,095,601 FNMA Pool #484974, 6.50%,
6/1/29 1,014,529
955,971 FNMA Pool #503915, 7.00%,
7/1/29 907,719
364,873 FNMA Pool #504748, 7.00%,
7/1/29 346,581
2,075,812 FNMA Pool #252645, 6.50%,
8/1/29 1,922,206
2,994,083 FNMA Pool #253112, 7.00%,
3/1/30 2,842,957
124,016 GNMA Pool #397233, 9.50%,
2/20/25 128,128
Principal Amount Value
--------------------------------------------------------------------------------
$ 50,293 GNMA Pool #392995, 8.75%,
3/15/25 $ 51,352
81,250 GNMA Pool #001991, 9.00%,
4/20/25 83,234
180,348 GNMA Pool #416856, 7.50%,
10/15/25 177,587
114,461 GNMA Pool #421254, 7.50%,
11/15/25 112,708
24,462 GNMA Pool #373704, 6.00%,
4/15/26 22,324
25,886 GNMA Pool #421388, 6.00%,
4/15/26 23,624
182,889 GNMA Pool #416761, 7.50%,
6/15/26 179,971
550,525 GNMA Pool #456569, 7.50%,
11/15/27 541,582
841,775 GNMA Pool #457351, 7.00%,
12/15/27 808,858
939,052 GNMA Pool #449491, 7.50%,
12/15/27 923,797
399,495 GNMA Pool #461623, 6.50%,
1/15/28 374,018
549,685 GNMA Pool #450628, 6.50%,
3/15/28 514,629
1,410,988 GNMA Pool #466804, 6.50%,
4/15/28 1,321,002
415,249 GNMA Pool #454559, 6.00%,
5/15/28 377,409
415,502 GNMA Pool #474782, 6.00%,
5/15/28 377,639
311,178 GNMA Pool #403868, 6.50%,
5/15/28 291,332
59,662 GNMA Pool #403912, 6.50%,
5/15/28 55,857
55,814 GNMA Pool #465798, 6.50%,
5/15/28 52,255
478,078 GNMA Pool #475802, 6.00%,
7/15/28 434,513
491,199 GNMA Pool #438917, 6.00%,
8/15/28 446,438
------------
TOTAL MORTGAGE-BACKED SECURITIES 28,123,651
------------
(Cost $29,017,302)
ASSET-BACKED SECURITIES(6) -- 1.1%
900,000 Americredit Automobile
Receivables Trust, Series
1999 D, Class A3 SEQ, 7.02%,
12/12/05 889,826
500,000 BMW Vehicle Owner Trust, Series
1999 A, Class A3 SEQ, 6.41%,
4/25/03 494,072
300,000 Comed Transitional Funding Trust,
Series 1998-1, Class A6 SEQ,
5.63%, 6/25/09 270,310
900,000 GMAC Commercial Mortgage
Securities Inc., Series 1999 C1,
Class A2 SEQ, 6.18%,
5/15/33 802,641
See Notes to Financial Statements www.americancentury.com 29
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
$ 127,170 Money Store (The) Home Equity
Trust, Series 1995 C,
Class A9 SEQ, 6.375%,
9/15/11 $ 126,752
165,017 Money Store (The) Home Equity
Trust, Series 1997 C,
Class AF4 SEQ, 6.37%,
8/15/17 164,590
300,000 Money Store (The) Home Equity
Trust, Series 1997 C,
Class AF6 SEQ, 6.67%,
2/15/25 294,134
531,440 Morgan Stanley Capital I,
Series 1998 WF1,
Class A1 SEQ, 6.25%, 7/15/07 509,029
700,000 Morgan Stanley Capital I,
Series 1998-WF1, Class A2,
6.55%, 12/15/07 650,772
362,466 Nationslink Funding Corp.,
Series 1998-2, Class A1 SEQ,
6.00%, 11/20/07 339,841
300,000 Nationslink Funding Corp.,
Series 1999-1, Class A2 SEQ,
6.32%, 11/20/08 272,360
32,084 Textron Financial Corp. Receivables
Trust, Series 1997 A, Class A,
6.05%, 3/16/09 (Acquired
9/18/97, Cost $32,042)(2) 31,981
------------
TOTAL ASSET-BACKED SECURITIES 4,846,308
------------
(Cost $5,094,152)
CORPORATE BONDS -- 9.5%
AIRLINES -- 0.1%
500,000 Atlas Air, Inc., 10.75%, 8/1/05 507,500
------------
BANKS -- 1.4%
1,500,000 Abbey National Treasury Services
PLC MTN, Series 1A, VRN,
6.25%, 7/24/00, resets
quarterly off the 3-month
LIBOR minus 0.07% with no
caps 1,498,902
500,000 Bank of America Corp., 6.125%,
7/15/04 469,648
1,500,000 Bank of America Corp., 7.80%,
2/15/10 1,462,634
2,000,000 Bank of America N.A., VRN,
6.52%, 8/3/00, resets quarterly
off the 3-month LIBOR plus
0.02% with no caps 1,998,902
400,000 Citigroup Inc., 7.125%, 5/15/06 386,056
650,000 First Bank System Inc., 7.625%,
5/1/05 640,723
------------
6,456,865
------------
CHEMICALS -- 0.1%
500,000 Huntsman ICI Chemicals, 11.80%,
12/31/09(7) 155,000
Principal Amount Value
--------------------------------------------------------------------------------
$ 500,000 United Industries Corp., Series B,
9.875%, 4/1/09 (Acquired
8/16/99-2/1/00, Cost
$440,625)(2) $ 355,000
------------
510,000
------------
DEFENSE/AEROSPACE -- 0.4%
450,000 Alliant Energy Resources, 7.375%,
11/9/09 (Acquired 11/4/99,
Cost $453,501)(2) 431,951
1,200,000 Raytheon Co., 8.20%, 3/1/06
(Acquired 3/3/00, Cost
$1,209,792)(2) 1,191,236
------------
1,623,187
------------
DEPARTMENT STORES -- 0.3%
1,500,000 Wal-Mart Stores, Inc., 6.875%,
8/10/09 1,433,745
------------
ELECTRICAL EQUIPMENT -- 0.1%
250,000 Fisher Scientific International Inc.,
7.125%, 12/15/05 225,562
250,000 Fisher Scientific International Inc.,
9.00%, 2/1/08 223,750
250,000 Trench Electric & Trench Inc.,
10.25%, 12/15/07 176,250
------------
625,562
------------
ELECTRICAL UTILITIES -- 0.2%
700,000 Cilcorp, Inc., 8.70%, 10/15/09 683,982
300,000 Southern Investments UK, 6.80%,
12/1/06 273,369
------------
957,351
------------
ENERGY RESERVES & PRODUCTION -- 0.3%
250,000 Belco Oil & Gas Corp., 8.875%,
9/15/07 227,500
250,000 Belco Oil & Gas Corp., Series B,
10.50%, 4/1/06 252,500
1,100,000 EOG Resources Inc., 6.70%,
11/15/06 1,019,307
------------
1,499,307
------------
ENVIRONMENTAL SERVICES -- 0.1%
500,000 Allied Waste Industries, Inc.,
Series B, 10.00%, 8/1/09 397,500
------------
EQUITY REAL ESTATE INVESTMENT
TRUST -- 0.1%
400,000 Chelsea GCA Realty Partners,
7.25%, 10/21/07 356,760
300,000 Spieker Properties, Inc., 6.80%,
12/15/01 293,932
------------
650,692
------------
FINANCIAL SERVICES -- 1.0%
250,000 Associates Corp., N.A., 6.375%,
6/15/00 249,962
3,200,000 Ford Motor Credit Co., 7.50%,
3/15/05 3,142,922
30 1-800-345-2021 See Notes to Financial Statements
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
$1,200,000 General Motors Acceptance Corp.
MTN, VRN, 6.28%, 6/12/00,
resets quarterly off the 3-month
LIBOR plus 0.15% with no caps $ 1,197,854
------------
4,590,738
------------
FOOD & BEVERAGE -- 0.1%
600,000 Pepsi Bottling Group Inc.,
Series B, 7.00%, 3/1/29
(Acquired 3/3/99, Cost
$595,920)(2) 522,176
------------
FOREST PRODUCTS & PAPER -- 0.4%
600,000 Fort James Corp., 6.625%,
9/15/04 568,010
1,000,000 Repap New Brunswick, 10.625%,
4/15/05 900,000
250,000 Riverwood International, 10.875%,
4/1/08 233,125
------------
1,701,135
------------
GAS & WATER UTILITIES -- 0.1%
250,000 Azurix Corp., 10.375%, 2/15/07
(Acquired 2/28/00, Cost
$252,500)(2) 233,750
------------
GOLD -- 0.1%
300,000 Barrick Gold Corp., 7.50%,
5/1/07 285,155
------------
HOTELS -- 0.2%
500,000 Hollywood Casino Corp., 11.25%,
5/1/07 507,500
500,000 Venetian Casino/Las Vegas
Sands, 12.25%, 11/15/04 487,500
------------
995,000
------------
INDUSTRIAL PARTS -- 0.1%
700,000 Petroleum Geo-Services ASA,
6.625%, 3/30/08 608,566
------------
INTERNET -- 0.2%
500,000 Exodus Communications, Inc.,
10.75%, 12/15/09 496,250
500,000 PSINet Inc., Series B, 10.00%,
2/15/05 445,000
------------
941,250
------------
LEISURE -- 0.1%
250,000 Imax Corp., 7.875%, 12/1/05 228,125
------------
LIFE & HEALTH INSURANCE -- 0.2%
400,000 Aetna Services, Inc., 6.75%,
8/15/01 394,883
400,000 Conseco Inc., 6.40%, 6/15/01 302,000
------------
696,883
------------
MEDIA -- 0.9%
500,000 AMFM Inc., 8.00%, 11/1/08 501,250
300,000 British Sky Broadcasting, 6.875%,
2/23/09 252,954
Principal Amount Value
--------------------------------------------------------------------------------
$ 500,000 Charter Communications Holdings
LLC, 8.625%, 4/1/09
(Acquired 3/12/99, Cost
$498,475)(2) $ 420,000
1,500,000 CSC Holdings Inc., Series B,
8.125%, 7/15/09 1,411,890
250,000 Fox Family Worldwide Inc., 9.25%,
11/1/07 215,000
400,000 Liberty Media Group, 8.25%,
2/1/30 (Acquired 1/26/00,
Cost $396,796)(2) 344,220
500,000 RCN Corp., 11.35%, 10/15/07(8) 292,500
600,000 TCI Communications, Inc., 8.75%,
8/1/15 632,351
100,000 Tele-Communications Inc., 8.25%,
1/15/03 101,593
------------
4,171,758
------------
MINING & METALS(2)
250,000 Kaiser Aluminum & Chemical,
12.75%, 2/1/03 227,500
------------
MOTOR VEHICLES & PARTS -- 0.5%
1,300,000 DaimlerChrysler AG, 7.125%,
3/1/02 1,293,226
500,000 Oxford Automotive Inc., Series D,
10.125%, 6/15/07 (Acquired
2/25/00, Cost $475,000)(2) 470,000
500,000 Sonic Automotive, Inc., Series B,
11.00%, 8/1/08 457,500
------------
2,220,726
------------
MULTI-INDUSTRY -- 0.4%
300,000 Hutchison Whampoa Financial,
Series B, 7.45%, 8/1/17
(Acquired 11/19/99, Cost
$274,113)(2) 260,394
1,400,000 Tyco International Group SA,
6.875%, 9/5/02 (Acquired
1/11/00-3/8/00, Cost
$1,376,875)(2) 1,371,819
------------
1,632,213
------------
OIL REFINING -- 0.1%
600,000 USX Corp., 6.65%, 2/1/06 556,303
------------
OIL SERVICES -- 0.1%
400,000 Gulf Canada Resources Ltd.,
8.35%, 8/1/06 389,000
------------
SECURITIES & ASSET MANAGEMENT -- 0.3%
1,200,000 Morgan Stanley Dean Witter & Co.,
7.125%, 1/15/03 1,183,369
------------
SEMICONDUCTOR -- 0.1%
250,000 DII Group, Inc., 8.50%, 9/15/07
(Acquired 9/17/97, Cost
$250,000)(2) 253,750
------------
See Notes to Financial Statements www.americancentury.com 31
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
TELEPHONE -- 1.1%
$ 250,000 Covad Communications Group,
Inc., 12.00%, 2/15/10
(Acquired 1/21/00, Cost
$250,000)(2) $ 231,250
500,000 Global Crossing Holdings Ltd.,
9.625%, 5/15/08 477,500
550,000 GTE North Inc., Series H, 5.65%,
11/15/08 472,111
500,000 KPNQwest B.V., 8.125%, 6/1/09 457,500
500,000 Viatel, Inc., 11.25%, 4/15/08 390,000
500,000 Williams Communication Group
Inc., 10.875%, 10/1/09 503,750
1,200,000 WorldCom, Inc., 7.875%,
5/15/03 1,197,941
1,200,000 WorldCom, Inc., VRN, 6.94%,
8/17/00, resets quarterly off
the 3-month LIBOR plus 0.18%
with no caps (Acquired
5/11/00, Cost $1,200,528)(2) 1,200,029
------------
4,930,081
------------
THRIFTS -- 0.1%
500,000 Bay View Capital Corp., 9.125%,
8/15/02 387,500
------------
WIRELESS TELECOMMUNICATIONS -- 0.3%
250,000 AT&T Canada Inc., 7.76%,
6/15/08(8) 201,659
750,000 Nextel Communications, Inc.,
9.375%, 11/15/09 708,750
500,000 Telecorp PCS Inc., 10.48%,
4/15/09(8) 330,000
------------
1,240,409
------------
TOTAL CORPORATE BONDS 42,657,096
------------
(Cost $44,572,690)
COMMERCIAL PAPER(5) -- 5.6%
BANKS -- 0.1%
500,000 Pemex Capital, Inc., 6.00%,
6/27/00 497,562
------------
CREDIT CARD & TRADE RECEIVABLES -- 0.5%
2,000,000 WCP Funding Inc., 6.07%,
6/7/00 (Acquired 4/11/00,
Cost $1,980,778)(2) 1,997,456
------------
ENERGY RESERVES & PRODUCTION -- 0.8%
1,500,000 Chevron Transport Corp., 5.95%,
6/2/00 (Acquired 2/24/00,
Cost $1,475,456)(2) 1,499,452
2,000,000 Sand Dollar Funding LLC, 6.13%,
6/19/00 (Acquired 4/5/00,
Cost $1,974,458)(2) 1,993,138
------------
3,492,590
------------
Principal Amount Value
--------------------------------------------------------------------------------
FINANCIAL SERVICES -- 1.4%
$2,000,000 AIG Funding Corp., 6.02%,
6/5/00 $ 1,998,180
2,000,000 Fortis Funding LLC, 6.10%,
6/23/00 (Acquired 4/5/00,
Cost $1,973,228)(2) 1,991,694
1,120,000 General Electric Capital Corp.,
6.16%, 7/18/00 1,110,216
1,232,000 Metlife Funding Inc., 6.17%,
7/17/00 1,221,465
------------
6,321,555
------------
FOOD & BEVERAGE -- 0.4%
2,000,000 Brown-Forman Corp., 6.63%,
8/16/00 (Acquired 5/15/00,
Cost $1,966,113)(2) 1,971,676
------------
INDUSTRIAL PARTS -- 0.4%
2,000,000 Invensys plc, 6.33%, 7/27/00
(Acquired 4/28/00, Cost
$1,969,405)(2) 1,979,168
------------
LIFE & HEALTH INSURANCE -- 0.4%
2,000,000 Allianz of America Inc., 6.15%,
7/5/00 1,987,332
------------
PROPERTY & CASUALTY INSURANCE -- 0.5%
2,200,000 Aegon Funding Corp., 6.64%,
8/17/00 (Acquired 5/18/00,
Cost $2,163,480)(2) 2,168,430
------------
SECURITIES & ASSET MANAGEMENT -- 1.1%
1,500,000 Credit Suisse First Boston Inc.,
5.93%, 7/10/00 (Acquired
1/6/00, Cost $1,455,031)(2) 1,489,121
2,000,000 Merrill Lynch & Co., Inc., 6.65%,
8/23/00 1,969,038
1,500,000 Morgan Stanley Dean Witter &
Co., 6.10%, 6/20/00 1,494,584
------------
4,952,743
------------
TOTAL COMMERCIAL PAPER 25,368,512
------------
(Cost $25,378,251)
CERTIFICATES OF DEPOSIT -- 0.4%
2,000,000 Canadian Imperial Bank of
Commerce (New York), 6.11%,
6/16/00 1,999,564
------------
(Cost $2,000,008)
FORWARD COMMITMENTS -- 0.5%
2,400,000 FNMA Purchase, 7.50%,
settlement 6/19/00 2,365,493
------------
(Cost $2,351,250)
32 1-800-345-2021 See Notes to Financial Statements
Strategic Moderate--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENTS -- 4.7%
Repurchase Agreement, Merrill Lynch & Co.,
Inc., (U.S. Treasury obligations), in a joint
trading account at 6.25%, dated 5/31/00,
due 6/1/00 (Delivery value $21,303,698) $ 21,300,000
------------
(Cost $21,300,000)
TOTAL INVESTMENT SECURITIES -- 100.0% $452,055,873
============
(Cost $409,600,631)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
Contracts Settlement Unrealized
to Sell Date Value Gain
--------------------------------------------------------------------------------
103,325,400 JPY 6/30/00 $974,387 $11,618
=====================================
(Value on Settlement Date $986,005)
Forward foreign currency exchange contracts appear at the end of the schedule of
investments. These contracts are designed to protect the fund's foreign
investments against declines in foreign currencies (also known as hedging). The
contracts are called "forward" because they allow the fund to exchange a foreign
currency for U.S. dollars on a specific date in the future--and at a prearranged
exchange rate.
NOTES TO SCHEDULE OF INVESTMENTS
ADR = American Depositary Receipt
FHLMC = Federal Home Loan Mortgage Corporation
FNMA = Federal National Mortgage Association
GDR = Global Depositary Receipt
GNMA = Government National Mortgage Association
JPY = Japanese Yen
LIBOR = London Interbank Offered Rate
MTN = Medium Term Note
ORD = Foreign Ordinary Share
SLMA = Student Loan Marketing Association
VRN = Variable Rate Note. Interest reset date is indicated and used in
calculating the weighted average portfolio maturity. Rate shown is effective May
31, 2000.
resets = The frequency with which a security's coupon changes, based on current
market conditions or an underlying index. The more frequently a security resets,
the less risk the investor is taking that the coupon will vary significantly
from current market rates.
(1) Non-income producing.
(2) Security was purchased under Rule 144A or Section 4(2) of the Securities
Act of 1933 or is a private placement and, unless registered under the Act
or exempted from registration, may only be sold to qualified institutional
investors. The aggregate value of restricted securities at May 31, 2000,
was $22,867,556 which represented 5.1% of net assets.
(3) Industry is less than 0.05% of total investment securities.
(4) Security, or a portion thereof, has been segregated at the custodian bank
for forward commitments.
(5) The rates indicated are the yield to maturity at purchase.
(6) Final maturity indicated. Expected remaining maturity used for purposes of
calculating the weighted average portfolio maturity.
(7) Security is a zero-coupon bond. The yield to maturity at purchase is
indicated. Zero coupon securities are purchased at a substantial discount
from their value at maturity.
(8) Step-coupon security. Yield to maturity at purchase is indicated. These
securities become interest bearing at a predetermined rate and future date
and are purchased at a substantial discount from their value at maturity.
See Notes to Financial Statements www.americancentury.com 33
Strategic Aggressive--Performance
--------------------------------------------------------------------------------
<TABLE>
TOTAL RETURNS AS OF MAY 31, 2000
INVESTOR CLASS (INCEPTION 2/15/96) ADVISOR CLASS (INCEPTION 10/2/96)
LEHMAN LEHMAN
STRATEGIC AGGREGATE 3-MONTH U.S. STRATEGIC AGGREGATE 3-MONTH U.S.
AGGRESSIVE S&P 500 BOND INDEX T-BILL INDEX AGGRESSIVE S&P 500 BOND INDEX T-BILL INDEX
========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6 MONTHS(1) 10.87% 2.88% 1.38% 2.80% 10.78% 2.88% 1.38% 2.80%
1 YEAR 29.16% 10.48% 2.11% 5.26% 28.92% 10.48% 2.11% 5.26%
========================================================================================================================
AVERAGE ANNUAL RETURNS
3 YEARS 18.58% 20.45% 5.73% 5.01% 18.25% 20.45% 5.73% 5.01%
LIFE OF FUND 16.56% 22.59%(2) 5.62%(2) 5.05%(2) 17.07% 23.76%(3) 6.05%(3) 5.04%(3)
(1) Returns for periods less than one year are not annualized.
(2) Since 2/29/96, the date nearest the class's inception for which data
are available.
(3) Since 9/30/96, the date nearest the class's inception for which data
are available.
</TABLE>
See pages 62-64 for more information about share classes, returns, and the
comparative indices.
[mountain graph - data below]
GROWTH OF $10,000 OVER LIFE OF FUND
Value on 5/31/00
S&P 500 $23,764
Strategic Aggressive $19,444
Lehman Aggregate $12,615
3-Month T-Bill $12,337
Strategic Lehman 3-Month
Aggressive S&P 500 Aggregate T-Bill
DATE VALUE VALUE VALUE VALUE
2/29/1996 $10,000 $10,000 $10,000 $10,000
3/31/1996 $10,101 $10,096 $9,930 $10,041
6/30/1996 $10,524 $10,549 $9,987 $10,168
9/30/1996 $10,766 $10,875 $10,171 $10,298
12/31/1996 $11,068 $11,781 $10,476 $10,426
3/31/1997 $10,803 $12,097 $10,418 $10,560
6/30/1997 $12,062 $14,210 $10,800 $10,694
9/30/1997 $13,077 $15,273 $11,159 $10,830
12/31/1997 $12,864 $15,712 $11,487 $10,969
3/31/1998 $14,293 $17,903 $11,666 $11,109
6/30/1998 $14,614 $18,494 $11,939 $11,248
9/30/1998 $12,993 $16,654 $12,444 $11,384
12/31/1998 $14,640 $20,201 $12,486 $11,506
3/31/1999 $14,744 $21,209 $12,424 $11,633
6/30/1999 $15,765 $22,707 $12,315 $11,764
9/30/1999 $15,632 $21,287 $12,398 $11,901
12/31/1999 $19,594 $24,455 $12,383 $12,052
3/31/2000 $21,222 $25,015 $12,657 $12,220
5/31/2000 $19,444 $23,764 $12,615 $12,337
$10,000 investment made 2/29/96
The graph at left shows the growth of a $10,000 investment over the life of the
fund, while the graph below shows the fund's year-by-year performance. The S&P
500, Lehman Aggregate Bond, and Three-Month U.S. Treasury Bill (T-Bill) indices
are provided for comparison in each graph. Strategic Aggressive's total returns
include operating expenses (such as transaction costs and management fees) that
reduce returns, while the total returns of the indices do not. The graphs are
based on Investor Class shares only; performance for other classes will vary due
to differences in fee structures (see the Total Returns table above). Past
performance does not guarantee future results. Investment return and principal
value will fluctuate, and redemption value may be more or less than original
cost.
[bar graph - data below]
ONE-YEAR RETURNS OVER LIFE OF FUND (PERIODS ENDED MAY 31)
Strategic Lehman 3-Month
Aggressive S&P 500 Aggregate T-Bill
DATE RETURN RETURN RETURN RETURN
5/31/96* 5.44% 5.04% -1.45% 1.25%
5/31/97 10.55% 29.48% 8.32% 5.17%
5/31/98 22.62% 30.68% 10.91% 5.16%
5/31/99 5.32% 21.04% 4.35% 4.62%
5/31/00 29.16% 10.48% 2.11% 5.26%
* From 2/29/96 (the date nearest the class's inception for which index data are
available) to 5/31/96.
34 1-800-345-2021
Strategic Aggressive--Q&A
--------------------------------------------------------------------------------
An interview with Jeff Tyler and Brian Howell (pictured on page 6),
portfolio managers on the American Century Strategic Asset Allocation funds
management team.
HOW DID STRATEGIC AGGRESSIVE PERFORM DURING THE SIX MONTHS ENDED MAY 31, 2000?
The fund's performance was very strong given the market environment. For
the six-month period, Strategic Aggressive posted a total return of 10.87%.*
(See the previous page for other fund performance information.)
THE FUND OUTPERFORMED THE S&P 500 BY A WIDE MARGIN (AS SHOWN ON THE PREVIOUS
PAGE). HOW DID THAT HAPPEN?
In part, we made some good asset allocation decisions. We usually make
modest adjustments to Strategic Aggressive's neutral asset mix of 75% stocks,
20% bonds, and 5% cash. During the first half of the period, we were overweight
stocks and underweight bonds and cash, which proved to be good for fund
performance.
But the main reason why the fund performed so well was our heavy overweight
in small- and mid-cap U.S. stocks early in the six-month period. We've started
to look at the small- and mid-cap sectors as a single entity, and we felt that
the best investment opportunities were in this part of the market. Small- and
mid-cap stocks outperformed large-caps by a pretty wide margin during the period
(see the table on page 3).
WHAT OTHER CHANGES DID YOU MAKE TO THE FUND'S STOCK PORTFOLIO?
As we mentioned in our annual report six months ago, we were considering
cutting back on our equity overweight after Y2K, and that's exactly what we did.
We began to gradually pare back our stock holdings in early 2000, and by the end
of the period we had brought the domestic stock portfolio back to a neutral
position.
CAN YOU GIVE SOME EXAMPLES OF STOCKS THAT HAD THE MOST SIGNIFICANT IMPACT ON
FUND PERFORMANCE?
Despite their volatility, technology stocks were the fund's best
performers. Semiconductor companies, our second-largest industry holding, were
consistently strong and even held up reasonably well when most tech stocks went
into a tailspin in April and May. Stronger demand for personal computers,
cellular phones, and other electronic devices that require chips helped boost
these stocks.
Our biggest industry holding was electrical equipment companies, and the
top performers were those that manufacture components for fiber-optic networks
and wireless communications. Fiber-optic networks are the backbone of the
developing infrastructure for high-speed Internet access and data transmission,
and the use of cell phones and other hand-held wireless devices has exploded in
the past year.
On the negative side, financial stocks, especially banks, were the
portfolio's weakest performers. Rising interest rates led to reduced lending
activity, and that in turn squeezed profit margins at many banks. Banks were
among the portfolio's largest industry holdings, so they had a sizable impact on
fund performance.
WHAT ABOUT THE FUND'S FOREIGN STOCK HOLDINGS?
The changes we made followed the same pattern as for the domestic stock
portion. We were heavily overweight in foreign stocks coming into 2000, but
then we pared back to a more neutral position over the last few months.
* All fund returns referenced in this interview are for Investor Class shares.
[right margin]
"THE MAIN REASON WHY THE FUND PERFORMED SO WELL WAS OUR HEAVY OVERWEIGHT IN
SMALL- AND MID-CAP U.S. STOCKS, WHICH OUTPERFORMED LARGE-CAPS BY A PRETTY WIDE
MARGIN."
[pie chart - data below]
ASSET ALLOCATION
% OF FUND INVESTMENTS
AS OF MAY 31, 2000
U.S. STOCKS 55%
U.S. BONDS 21%
FOREIGN STOCKS 17%
MONEY MARKET SECURITIES 7%
See page 63 for the fund's neutral asset mix.
Investment terms are defined in the Glossary on pages 64-65.
www.americancentury.com 35
Strategic Aggressive--Q&A
--------------------------------------------------------------------------------
(Continued)
In addition, we reduced our Japanese stock holdings and shifted some of those
assets back into Europe. Many of our Japanese stocks performed very well in
1999, and we felt it prudent to trim our holdings, especially with the economic
pendulum swinging back toward weakness in early 2000.
Unlike six months ago, when many of our biggest foreign holdings were in
Japan, the portfolio is now focused more on companies in Europe and Canada.
LET'S SHIFT TO STRATEGIC AGGRESSIVE'S BOND PORTFOLIO. HOW WAS IT POSITIONED?
We did some rebalancing during the past six months to bring the bond portion
more in line with the sector weightings of the Lehman Aggregate Bond Index. That
meant cutting back a little on our corporate bond holdings and adding more
Treasury and government agency securities.
Treasury bonds performed very well during the period, so we extended the
duration (a measure of price volatility as interest rates change) of our
Treasury holdings to take greater advantage of their price gains. To keep our
overall duration in line with that of the Lehman index, we shortened the
duration of our other holdings.
We also adopted a slightly more conservative position by reducing our
holdings of lower-rated corporate bonds. With the Fed raising interest rates to
slow the economy, we preferred to own high-quality bonds issued by stable,
well-known companies.
THE FUND NO LONGER OWNS ANY FOREIGN BONDS. WHY THE CHANGE?
As of the first of the year, we eliminated the fund's strategic weighting in
foreign bonds, which was typically around 5% of the portfolio. We found that
this slice of the portfolio increased the fund's overall risk level without a
measurable increase in performance. In other words, all it was giving us was
extra volatility, and that's the opposite of what a diversified fund like
Strategic Aggressive is all about.
We may still invest in foreign bonds from time to time when we see attractive
opportunities, but it would likely be a very small part of the portfolio.
LOOKING AHEAD, WHAT ARE YOUR PLANS FOR STRATEGIC AGGRESSIVE'S ASSET ALLOCATION
STRUCTURE?
As usual, we'll keep it close to the neutral asset mix of 75% stocks, 20%
bonds, and 5% cash to stay true to the fund's long-term investment goals.
[left margin]
FUND'S U.S. STOCKS
AS OF MAY 31, 2000
NUMBER OF COMPANIES 289
DIVIDEND YIELD 1.1%
PRICE/EARNINGS RATIO 24.3
TOP 5 U.S. STOCKS
% OF FUND'S % OF
U.S. STOCKS FUND
JDS UNIPHASE CORP. 3.0% 1.7%
CISCO SYSTEMS INC. 2.5% 1.4%
GENERAL ELECTRIC CO. (U.S.) 2.4% 1.3%
INTEL CORP. 1.9% 1.0%
WARNER-LAMBERT CO. 1.7% 0.9%
FUND'S FOREIGN STOCKS
AS OF MAY 31, 2000
NUMBER OF COMPANIES 192
DIVIDEND YIELD 0.8%
TOP 5 FOREIGN STOCKS
% OF FUND'S % OF
COUNTRY FOREIGN STOCKS FUND
NORTEL NETWORKS
CORP. CANADA 3.8% 0.7%
VODAFONE AIRTOUCH
PLC ORD U.K. 2.3% 0.4%
ROYAL DUTCH
PETROLEUM CO.
NEW YORK SHARES NETHERLANDS 2.2% 0.4%
SAMSUNG ELECTRONICS
ORD SOUTH KOREA 1.9% 0.3%
SKANDIA FORSAKRINGS
AB ORD SWEDEN 1.9% 0.3%
[pie chart - data below]
% OF FUND'S FOREIGN STOCKS
EUROPE 62%
ASIA/PACIFIC 23%
AMERICAS (EXCLUDING U.S.) 15%
36 1-800-345-2021
Strategic Aggressive--Q&A
--------------------------------------------------------------------------------
(Continued)
Since the end of the period, however, we've been reducing the portfolio's
cash position a little and moving back to an overweight in stocks.
WHAT'S THE ATTRACTION OF STOCKS RIGHT NOW?
We think that the stock market is in a better position after weathering a
period of economic uncertainty. While we certainly don't expect to see the 25%
annual returns that the S&P 500 posted over the past five years, we do expect
greater stability and returns more in line with corporate earnings growth as we
move forward.
That said, we also believe that we're closer to the beginning than the end
of the shakeout among technology companies, and we're not sure how that will
ultimately play out.
CAN YOU TALK A LITTLE BIT MORE ABOUT THIS SHAKEOUT?
The decline in technology shares over the past few months has taken some of
the air out of the New Economy balloon, and investors are starting to take a
harder look at the long-term business plans and profitability of their
technology investments.
Prior to this year, venture capital for technology start-ups flowed freely,
and tech firms were going public at a rate of several per week. In the past six
months, however, the market for initial public offerings has dried up, and
venture capital has become increasingly hard to get.
As the tech sector continues to evolve, we expect to see a great deal of
consolidation. A large number of companies that were built on promises and
little else will likely be bought out or disappear completely. In the end,
though, we expect the survivors to be stronger and in a better position to be
successful and profitable companies over the long term.
WILL THIS HAVE ANY EFFECT ON YOUR INVESTMENT STRATEGY GOING FORWARD?
It won't change the way we look at technology stocks or equity investing in
general. Our stock portfolio managers have always emphasized high-quality
companies, whether they're technology-oriented firms or industrial
manufacturers. We'll continue to invest in technology companies that meet our
stringent investment guidelines.
These standards also extend to our foreign stock holdings. Our foreign
equity managers are constantly monitoring technological developments overseas.
For example, wireless telecommunications are used to a much greater extent in
Europe and Japan than they are in the U.S. This heavy usage has created a class
of companies at the forefront of mobile computing and communication. We're
investing in the best of these companies because they will be the most likely to
benefit from the millions of people who shop, trade securities, do banking, and
book flights using only their mobile phones.
HOW WILL YOU POSITION THE PORTFOLIO'S BOND HOLDINGS GOING FORWARD?
We intend to maintain our current neutral position in bonds. We're starting
to see evidence that the U.S. economy is slowing down, and that probably means
the Fed is finished raising interest rates for the time being. Although
inflation is higher than it has been in the past couple of years, it's still low
on a historical basis. These factors are generally positive for bonds.
[right margin]
"SINCE THE END OF THE PERIOD, WE'VE BEEN REDUCING THE PORTFOLIO'S CASH POSITION
A LITTLE AND MOVING BACK TO AN OVERWEIGHT IN STOCKS."
FUND'S U.S. BONDS
AS OF MAY 31, 2000
NUMBER OF SECURITIES 121
WEIGHTED AVERAGE MATURITY 8.0 YRS
AVERAGE DURATION 5.0 YRS
[pie chart - data below]
% OF FUND'S U.S. BONDS
CORPORATE SECURITIES 35%
U.S. TREASURY SECURITIES 21%
U.S. GOVT. AGENCY SECURITIES 21%
MORTGAGE-BACKED SECURITIES 19%
ASSET-BACKED SECURITIES 3%
OTHER 1%
www.americancentury.com 37
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
COMMON STOCKS & RIGHTS -- 72.0%
ALCOHOL -- 0.1%
6,300 A-Ahram Beverages Co. GDR
(Acquired 4/14/00-4/17/00,
Cost $114,165)(1)(2) $ 111,982
1,800 Anheuser-Busch Companies, Inc. 139,500
5,400 Hite Brewery Co., Ltd. ORD 174,502
------------
425,984
------------
APPAREL & TEXTILES -- 0.2%
71,000 Far Eastern Textile Ltd. ORD 115,222
4,150 Kenneth Cole Productions, Inc.
Cl A(1) 138,766
4,700 Liz Claiborne, Inc. 184,769
------------
438,757
------------
BANKS -- 5.1%
159,993 African Bank Investments Limited
ORD(1) 322,045
2,850 Alpha Credit Bank ORD 120,937
85,860 Banca Intesa S.p.A. ORD 339,653
17,400 Banco Rio de la Plata S.A.
Cl B ORD 114,509
34,101 Bank of America Corp. 1,894,737
8,300 Barclays PLC ORD 216,202
12,900 Chase Manhattan Corp. 963,469
25,400 Citigroup Inc. 1,579,562
24,400 First Union Corp. 858,575
42,600 First Virginia Banks, Inc. 1,690,688
4,800 Fleet Boston Financial Corp. 181,500
300,000 Grupo Financiero Bancomer, S.A.
de C.V. Cl O ORD 153,085
139,000 Grupo Financiero Banorte S.A.
de C.V. Cl O ORD(1) 190,120
11,324 ICICI Bank Ltd. ADR(1) 174,106
64,200 KeyCorp 1,348,200
5,400 Komercni Banka a.s. ORD(1) 116,574
34,539 Nordic Baltic Holding AB ORD 229,279
4,200 Old Kent Financial Corp. 139,650
9,000 PNC Bank Corp. 453,375
6,300 Societe Generale Cl A ORD 364,405
68,500 Summit Bancorp. 1,965,094
10,100 UnionBanCal Corp. 345,925
8,000 Wachovia Corp. 553,000
22,787,897 Yapi ve Kredi Bankasi A.S. ORD 281,308
------------
14,595,998
------------
CHEMICALS -- 1.1%
5,900 BorsodChem Rt. ORD 195,766
5,800 Dow Chemical Co. 620,962
8,700 du Pont (E.I.) de Nemours & Co. 426,300
16,900 Minnesota Mining &
Manufacturing Co. 1,449,175
Shares Value
--------------------------------------------------------------------------------
1,400 Pannonplast Rt. ORD $ 31,558
11,300 Praxair, Inc. 474,600
------------
3,198,361
------------
CLOTHING STORES(3)
8,100 Gadzooks, Inc.(1) 115,425
------------
COMPUTER HARDWARE &
BUSINESS MACHINES -- 2.2%
500 Adaptec, Inc.(1) 9,859
1,700 Apple Computer, Inc.(1) 142,853
12,000 Asustek Computer Inc. ORD 121,130
25,700 Dell Computer Corp.(1) 1,109,116
16,000 EMC Corp. (Mass.)(1) 1,861,000
5,400 Hewlett-Packard Co. 648,675
23,000 Hon Hai Precision Industry ORD(1) 210,516
6,200 Network Appliances, Inc.(1) 400,094
3,000 Network Peripherals, Inc.(1) 53,344
2,600 Proxim, Inc.(1) 226,931
6,200 Sanmina Corp.(1) 394,669
7,500 Sun Microsystems, Inc.(1) 574,453
18,500 Xerox Corp. 501,812
------------
6,254,452
------------
COMPUTER SOFTWARE -- 3.6%
2,800 Amdocs Ltd.(1) 173,425
1,000 AudioCodes Ltd.(1) 73,031
5,100 Autodesk, Inc. 188,859
1,700 Business Objects S.A. ADR(1) 136,000
4,000 Check Point Software
Technologies Ltd.(1) 751,750
3,100 Computer Associates
International, Inc. 159,650
14,800 International Business Machines
Corp. 1,588,225
611 Intershop Communications AG
ORD(1) 247,991
58,300 Ixchange Technology Holdings
Limited ORD(1) 113,159
3,800 Lernout & Hauspie Speech
Products N.V.(1) 159,006
8,500 Logica plc ORD 227,778
34,300 Microsoft Corp.(1)(4) 2,144,822
26,000 Misys plc ORD 224,715
5,600 National Instruments Corp.(1) 202,825
7,600 Objective Systems Integrators, Inc.(1) 55,931
11,900 ONYX Software Corp.(1) 203,416
30,800 Oracle Corp.(1) 2,211,825
1,300 SAP AG ADR 55,738
4,523 Softbank S.A. ORD 187,301
146,000 Softline Limited ORD(1) 144,840
3,200 Tieto Corp. Cl B ORD 125,392
6,700 Veritas Software Corp.(1) 780,341
------------
10,156,020
------------
CONSTRUCTION & REAL PROPERTY -- 0.3%
45,000 Cemex SA de CV Cl A ORD 190,804
1,800 Mastec, Inc.(1) 123,075
38 1-800-345-2021 See Notes to Financial Statements
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
28,706 Mostostal Zabrze - Holding S.A.
ORD $ 84,583
57,000 President Chain Store Corp. ORD 219,231
5,600 Quanta Services, Inc.(1) 274,400
------------
892,093
------------
CONSUMER DURABLES -- 0.4%
25,900 Pier 1 Imports, Inc. 220,150
5,000 PIONEER CORP. ORD 152,470
16,000 Sharp Corporation ORD 287,700
194 Swatch Group AG (The) Cl B ORD 238,118
3,300 Whirlpool Corp. 187,069
------------
1,085,507
------------
DEFENSE/AEROSPACE -- 0.6%
20,600 Boeing Co. 804,688
24,500 Lockheed Martin Corp. 600,250
700 Northrop Grumman Corp. 53,638
8,100 Raytheon Co. Cl B 189,844
------------
1,648,420
------------
DEPARTMENT STORES -- 1.1%
24,800 Ames Department Stores, Inc.(1) 293,725
10,000 May Department Stores Co. (The) 300,625
1,400 Pinault-Printemps-Redoute SA
ORD 302,051
3,400 Sears, Roebuck & Co. 125,588
80,000 Wal-Mart de Mexico SA de CV
Series V ORD(1) 164,974
34,000 Wal-Mart Stores, Inc. 1,959,250
------------
3,146,213
------------
DRUGS -- 4.2%
5,000 American Home Products Corp. 269,375
10,500 Amgen Inc.(1) 668,391
2,100 Aventis SA ORD 136,885
16,300 Bristol-Myers Squibb Co. 897,519
5,000 Diversa Corp.(1) 109,375
15,700 Enzon, Inc.(1) 452,847
5,700 ILEX Oncology, Inc.(1) 142,322
4,100 IVAX Corp.(1) 154,262
3,900 Jones Pharma Inc. 142,228
800 MedImmune, Inc.(1) 124,275
3,600 Merck & Co., Inc. 268,650
227 Novartis AG ORD 335,966
2,829 Novo Nordisk A/S Cl B ORD 469,569
40,800 Pfizer, Inc. 1,818,150
10,900 Protein Design Labs, Inc.(1) 1,162,553
3,200 QLT PhotoTherapeutics Inc.(1) 156,800
2,565 Richter Gedeon Rt. ORD 150,744
20,200 Schering-Plough Corp. 977,175
3,000 Takeda Chemical Industries, Ltd.
ORD 204,375
8,200 Tanox, Inc.(1) 414,356
7,200 Titan Pharmaceuticals, Inc.(1) 182,700
21,300 Warner-Lambert Co. 2,601,262
------------
11,839,779
------------
Shares Value
--------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT -- 9.5%
5,700 Advanced Energy Industries, Inc.(1) $ 210,188
9,885 Alcatel Alsthom Compagnie
Generale ORD 548,196
7,900 ANTEC Corp.(1) 395,988
2,800 AVX Technology 160,475
7,700 Celestica Inc.(1) 358,531
8,900 CIENA Corp.(1) 1,065,497
68,500 Cisco Systems Inc.(1) 3,898,078
4,700 Comverse Technology, Inc.(1) 429,609
2,500 Corning Inc. 483,594
2,500 Credence Systems Corp.(1) 136,562
18,200 Digital Microwave Corp.(1) 507,894
3,100 E-Tek Dynamics, Inc.(1) 570,109
98,000 Eastern Communications Co., Ltd.
Cl B ORD 97,216
29,000 Ericsson (L.M.) Telephone Co.
ADR 593,594
13,685 Flextronics International Ltd.
ADR(1) 744,550
1,000 Gilat Satellite Networks Ltd.(1) 80,844
17,500 Glenayre Technologies, Inc.(1) 143,828
5,000 Harmonic Inc.(1) 223,281
31,000 Hitachi Ltd. ORD 383,298
3,800 Integrated Circuit Systems, Inc.(1) 46,075
54,380 JDS Uniphase Corp.(1) 4,785,492
3,300 KEMET Corp.(1) 221,719
200 Keyence Corporation ORD 59,783
5,600 KLA-Tencor Corporation(1) 277,375
2,200 Motorola, Inc. 206,250
13,800 Nokia Corp. Cl A ADR 717,600
34,600 Nortel Networks Corp. 1,879,212
1,900 Orbotech Ltd.(1) 160,788
13,088 Phillips Electronics N.V. New
York Shares 578,326
51,100 Pinnacle Systems, Inc.(1) 1,221,609
17,700 Powerwave Technologies, Inc.(1) 958,566
200 Sagem SA New Shares ORD 235,483
3,501 Samsung Electronics ORD 954,677
6,200 Scientific-Atlanta, Inc. 349,525
9,600 Sensormatic Electronics Corp.(1) 150,600
3,900 Siemens AG ORD 573,389
1,900 Sony Corp. ORD 171,703
15,400 Tekelec, Inc.(1) 507,238
2,000 Tokyo Electron Ltd. ORD 272,500
8,900 Tollgrade Communications, Inc.(1) 589,069
44,000 Toshiba Corp. ORD 424,136
3,800 UTStarcom Inc.(1) 146,062
4,700 Vishay Intertechnology, Inc.(1) 332,525
14,600 Westell Technologies, Inc.(1) 241,356
------------
27,092,390
------------
ELECTRICAL UTILITIES -- 1.7%
7,900 AES Corp. (The)(1) 689,275
11,000 Calpine Corp.(1) 1,165,312
See Notes to Financial Statements www.americancentury.com 39
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
14,492,000 Companhia de Transmissao de
Energia Eletrica Paulista ORD(1) $ 58,063
4,088,000 Empresa Paulista de Transmissao
de Energia SA ORD 32,219
8,400 Florida Progress Corp. 416,850
32,200 FPL Group, Inc. 1,593,900
13,800 Niagara Mohawk Holdings Inc.(1) 202,688
6,000 Public Service Enterprise Group Inc. 223,500
6,900 Reliant Energy, Inc. 196,650
4,000 Southern Co. 103,750
8,400 Utilicorp United Inc. 164,850
------------
4,847,057
------------
ENERGY RESERVES & PRODUCTION -- 3.3%
11,800 Amerada Hess Corp. 783,225
8,000 Apache Corp. 487,000
11,300 BP Amoco Plc ADR 614,438
9,300 Burlington Resources Inc. 425,475
13,000 Chevron Corp. 1,201,688
20,016 Exxon Mobil Corp. 1,667,583
21,800 Kerr-McGee Corp. 1,301,188
2,600 Lukoil Holding ADR 143,650
8,100 Murphy Oil Corp. 525,488
17,400 Royal Dutch Petroleum Co. New
York Shares 1,086,412
10,500 Surgutneftegaz ADR(1) 151,594
23,200 Triton Energy Ltd.(1) 774,300
9,200 Union Pacific Resources 217,925
------------
9,379,966
------------
ENTERTAINMENT -- 0.6%
61,800 Corporacion Interamericana de
Entretenimiento S.A.
Cl B ORD(1) 246,433
23,889 Viacom, Inc. Cl B(1) 1,481,118
------------
1,727,551
------------
EQUITY REAL ESTATE
INVESTMENT TRUST -- 0.1%
6,000 Pinnacle Holdings Inc.(1) 293,812
------------
FINANCIAL SERVICES -- 3.0%
10,800 American Express Co. 581,175
113,000 China Development Industrial
Bank ORD(1) 172,379
9,000 Coronation Holdings Limited ORD 144,409
6,600 Countrywide Credit Industries, Inc. 202,950
2,400 Credit Suisse Group ORD 449,358
8,700 Fannie Mae 523,088
3,700 Federal Home Loan Mortgage
Corporation 164,650
71,200 General Electric Co. (U.S.) 3,746,900
3,739 ING Groep N.V. ORD 224,174
79 Julius Baer Holding AG ORD 284,088
600 Marschollek Lautenschlaeger und
Partner AG ORD 211,542
7,300 Marsh & McLennan Companies, Inc. 803,456
Shares Value
--------------------------------------------------------------------------------
2,200 Providian Financial Corp. $ 195,662
35,800 Skandia Forsakrings AB ORD 918,645
------------
8,622,476
------------
FOOD & BEVERAGE -- 1.7%
75,276 Archer-Daniels-Midland Co. 898,607
23,457 Diageo plc ORD 200,979
10,900 Hartwall Oyj Abp ORD 172,273
11,300 IBP, Inc. 186,450
62,600 Interstate Bakeries Corp. 907,700
17,200 PepsiCo, Inc. 699,825
8,200 Quaker Oats Co. (The) 603,212
7,600 Suiza Foods Corp.(1) 341,050
2,500 SYSCO Corp. 104,844
76,900 Tyson Foods, Inc. Cl A 759,388
------------
4,874,328
------------
FOREST PRODUCTS & PAPER -- 0.3%
6,900 Aracruz Celulose S.A. ADR 115,575
5,127 International Paper Co. 178,484
2,000 Temple-Inland Inc. 99,375
4,770,000 Votorantim Celulose e Papel
SA ORD 151,844
4,300 Weyerhaeuser Co. 213,388
------------
758,666
------------
GAS & WATER UTILITIES -- 0.9%
42,600 AGL Resources Inc. 708,225
114,655 Centrica plc ORD 415,615
6,700 Kinder Morgan, Inc. 218,588
3,000 Suez Lyonnaise des Eaux ORD 505,008
26,400 Washington Gas Light Co. 702,900
------------
2,550,336
------------
GOLD -- 0.1%
11,100 Barrick Gold Corp. 200,494
------------
GROCERY STORES -- 0.1%
5,000 Grupo Gigante SA de CV ORD(1) 7,628
4,400 Safeway Inc.(1) 202,950
------------
210,578
------------
HEAVY ELECTRICAL EQUIPMENT -- 1.0%
4,434 ABB Ltd. ORD 552,142
2,000 C&D Technologies, Inc. 145,000
4,800 CommScope, Inc.(1) 185,400
22,800 Cooper Industries, Inc. 763,800
3,300 Cummins Engine Company, Inc. 107,456
17,600 Emerson Electric Co. 1,038,400
------------
2,792,198
------------
HEAVY MACHINERY(3)
2,800 Atlas Copco AB Cl A ORD 60,291
2,100 Atlas Copco AB Cl B ORD 46,858
------------
107,149
------------
HOME PRODUCTS -- 0.4%
6,900 Avon Products, Inc. 285,056
3,100 Colgate-Palmolive Co. 163,138
40 1-800-345-2021 See Notes to Financial Statements
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
5,000 Kao Corporation ORD $ 151,543
3,000 Procter & Gamble Co. (The) 199,500
5,700 Ralston Purina Co. 105,806
9,528,900 Trakya Cam Sanayii A.S. ORD 125,369
------------
1,030,412
------------
HOTELS -- 0.1%
19,800 Park Place Entertainment Corp.(1) 249,975
------------
INDUSTRIAL PARTS -- 0.6%
13,800 Assa Abloy AB Cl B ORD 266,356
552 Assa Abloy AB Cl B New Shares
ORD(1) 10,654
4,100 Cymer, Inc.(1) 129,534
6,413 Illinois Tool Works Inc. 372,355
2,400 Ingersoll-Rand Co. 109,350
8,100 Maillis ORD 113,111
14,000 Tubos de Acero de Mexico,
SA ADR 189,000
1,700 United Technologies Corp. 102,744
12,400 York International Corp. 323,950
------------
1,617,054
------------
INDUSTRIAL SERVICES -- 0.4%
8,200 Capita Group Plc ORD 183,628
12,000 Compass Group PLC ORD 134,631
3,600 Hertz Corp. Cl A 112,725
3,000 ISS A/S ORD(1) 217,971
14,900 Securitas AB Cl B ORD 348,263
------------
997,218
------------
INFORMATION SERVICES -- 2.4%
259 Adecco SA ORD 205,057
3,200 Automatic Data Processing, Inc. 175,800
6,700 BISYS Group, Inc. (The)(1) 440,734
473 Cap Gemini SA ORD 88,868
14,000 Ceridian Corp.(1) 337,750
18,800 CMG plc ORD 262,738
4,600 Computer Sciences Corp.(1) 441,312
12,000 Cysive, Inc.(1) 304,500
26,000 Datacraft Asia Limited ORD 180,700
15,000 Diamond Technology Partners
Inc.(1) 949,688
32,000 Dimension Data Holdings Ltd.
ORD(1) 223,141
9,500 Dun & Bradstreet Corp. (The) 292,125
3,800 Electronic Data Systems Corp. 244,388
6,100 eLoyalty Corp.(1) 91,119
12,400 First Data Corp. 695,175
12,000 Getronics N.V. ORD 201,442
29,600 Hays plc ORD 166,267
6,156 Insung Information ORD 80,390
13,500 Proxicom, Inc.(1) 618,891
3,300 Sapient Corp.(1) 329,691
18,300 SEMA Group plc ORD 255,476
Shares Value
--------------------------------------------------------------------------------
5,700 TenFold Corp.(1) $ 99,750
6,000 Valassis Communications, Inc.(1) 198,000
------------
6,883,002
------------
INTERNET -- 1.0%
23,700 America Online Inc.(1) 1,256,100
2,200 Digital Island(1) 40,356
5,500 GlobeSpan, Inc.(1) 486,234
7,800 Portal Software, Inc.(1) 313,706
1,374 Tiscali SpA ORD(1) 68,489
5,500 Verio Inc.(1) 313,844
3,700 Yahoo! Inc.(1) 418,216
------------
2,896,945
------------
LEISURE -- 0.2%
3,600 Eastman Kodak Co. 215,100
9,200 GTECH Holdings Corp.(1) 202,975
5,700 Polaroid Corp. 109,369
------------
527,444
------------
LIFE & HEALTH INSURANCE -- 0.3%
2,200 CIGNA Corp. 195,388
10,200 Lincoln National Corp. 395,250
15,600 Mediolanum SpA ORD 239,262
------------
829,900
------------
MEDIA -- 2.4%
18,000 Clear Channel Communications,
Inc.(1) 1,347,750
7,600 Comcast Corp. Cl A(1) 288,088
3,500 Cox Communications, Inc. Cl A(1) 154,438
13,600 Disney (Walt) Co. 573,750
2,163 EM.TV & Merchandising AG ORD 145,341
13 Fuji Television Network, Inc. ORD 197,609
2,600 General Motors Corp. Cl H(1) 255,938
3,800 Grupo Televisa S.A. GDR(1) 211,612
14,200 Infinity Broadcasting Corp. Cl A(1) 449,075
13,838 Mediaset SpA ORD 214,826
2,682 Modern Times Group MTG AB
Cl B ORD(1) 120,437
12,500 Mondadori (Arnoldo) Editore
SpA ORD 288,158
8,700 News Corp. Ltd. (The) ADR 396,394
6,000 Pearson plc ORD 181,186
1,900 Radio One, Inc.(1) 136,088
600 Societe Television
Francaise 1 ORD 387,173
2,951 Sogecable, S.A. ORD(1) 109,563
4,300 TV Azteca SA DE CV ADR 40,581
10,700 UnitedGlobalCom Cl A(1) 513,266
4,800 Univision Communications Inc.
Cl A(1) 494,400
20,800 WPP Group plc ORD 253,301
------------
6,758,974
------------
See Notes to Financial Statements www.americancentury.com 41
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
MEDICAL PRODUCTS & SUPPLIES -- 1.5%
7,200 Aclara BioSciences, Inc.(1) $ 194,625
1,800 ArthroCare Corp.(1) 153,450
1,000 Aurora Biosciences Corp.(1) 47,406
4,000 Bard (C.R.), Inc. 182,500
8,000 Beckman Coulter Inc. 481,000
9,300 CONMED Corp.(1) 224,072
13,200 Guidant Corp.(1) 668,250
3,000 Hoya Corp. ORD 277,783
6,600 Johnson & Johnson 590,700
17,900 Medtronic, Inc. 924,088
4,500 MiniMed Inc.(1) 536,906
2,200 Nanogen, Inc.(1) 54,588
------------
4,335,368
------------
MEDICAL PROVIDERS & SERVICES -- 0.6%
40,400 HCA-The Healthcare Corp.(1) 1,090,800
13,700 Oxford Health Plans, Inc.(1) 291,553
3,000 United HealthCare Corp. 223,688
------------
1,606,041
------------
MINING & METALS -- 0.5%
5,100 Alcoa Inc. 298,031
750,000 Angang New Steel Co. Ltd.
Cl H ORD 58,710
5,898,000 Companhia Siderurgica Nacional
ORD 192,608
6,100 Companhia Vale do Rio Doce
Cl A ORD 152,333
3,200 Impala Platinum Holdings Limited
ORD 107,016
29,000 Iscor Limited ORD 65,044
14,300 Maverick Tube Corp.(1) 502,734
39,900 Siderca S.A.I.C. ORD 74,225
------------
1,450,701
------------
MOTOR VEHICLES & PARTS -- 0.6%
1,606,300 Brisa Bridgestone Sabanci Lastik
San. Ve Tic A.S. ORD 104,364
11,400 Ford Motor Co. 553,612
1,400 General Motors Corp. 98,875
4,700 North American Bus Industries Rt.
ORD(1) 92,552
2,700 PACCAR Inc. 113,231
19,700 Superior Industries International,
Inc. 550,369
4,000 Toyota Motor Corp. ORD 181,296
------------
1,694,299
------------
MULTI-INDUSTRY -- 0.8%
19,000 Citic Pacific Ltd. ORD 90,459
7,900 Compagnie Financiere Richemont
AG Depositary Receipts ORD 194,909
6,752,800 Dogan Sirketler Grubu Holding
A.S. ORD 156,301
13,433 Elektrim Spolka Akcyjna S.A.
ORD(1) 174,216
33,600 Hutchison Whampoa Limited ORD 388,065
Shares Value
--------------------------------------------------------------------------------
13,500 Tyco International Ltd. $ 635,344
5,790 Vivendi ORD 622,703
------------
2,261,997
------------
OIL REFINING(3)
7,900 Polski Koncern Naftowy SA GDR
(Acquired 5/31/00, Cost
$74,505)(2) 74,062
------------
OIL SERVICES -- 2.0%
5,600 Baker Hughes Inc. 203,000
5,700 BJ Services Co.(1) 408,262
5,400 Ensco International Inc. 188,662
15,600 Global Marine Inc.(1) 441,675
7,200 Grant Prideco, Inc.(1) 167,400
32,500 Key Energy Group, Inc.(1) 353,438
30,700 Marine Drilling Co., Inc.(1) 882,625
10,900 National-Oilwell, Inc.(1) 283,400
8,600 Patterson Energy, Inc.(1) 207,744
9,700 PetroChina Co. Ltd. ADR(1) 195,212
22,600 R&B Falcon Corp.(1) 529,688
23,000 Rowan Companies, Inc.(1) 714,438
5,000 Smith International, Inc.(1) 395,312
10,900 Transocean Sedco Forex, Inc. 536,144
5,400 Weatherford International, Inc.(1) 232,538
------------
5,739,538
------------
PROPERTY & CASUALTY INSURANCE -- 1.9%
4,700 Ace, Ltd.(1) 126,019
22,400 Alleanza Assicurazioni ORD 258,504
15,300 Allstate Corp. 405,450
5,200 Ambac Financial Group, Inc. 261,950
7,750 American International Group, Inc. 872,359
2,848 Axa ORD 420,825
13,800 Chubb Corp. (The) 966,000
4,200 Everest Reinsurance Holdings, Inc. 142,800
46,400 Horace Mann Educators Corp. 788,800
16,500 MGIC Investment Corp. 817,781
11,800 Prudential Corporation PLC ORD 178,785
2,600 Radian Group Inc. 143,000
------------
5,382,273
------------
PUBLISHING -- 0.5%
1,842 Altran Technologies SA ORD 415,156
15,300 Banta Corp. 283,050
6,400 Deluxe Corp. 158,000
3,400 Dow Jones & Co., Inc. 231,200
9,200 VNU N.V. ORD 470,630
------------
1,558,036
------------
RAILROADS -- 0.1%
9,000 Union Pacific Corp. 380,812
------------
RESTAURANTS -- 0.1%
4,400 Brinker International, Inc.(1) 124,575
5,500 Jack in the Box Inc.(1) 136,469
------------
261,044
------------
42 1-800-345-2021 See Notes to Financial Statements
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares Value
--------------------------------------------------------------------------------
SECURITIES & ASSET MANAGEMENT -- 0.6%
26,000 Amvescap Plc ORD $ 341,551
639 Consors Discount Broker AG ORD 59,849
13,200 Morgan Stanley Dean Witter & Co. 949,575
15,000 Nomura Securities Co., Ltd. ORD 343,405
------------
1,694,380
------------
SEMICONDUCTOR -- 5.6%
4,500 Applied Materials, Inc.(1) 375,891
2,100 ASM Lithography Holding N.V.
New York Shares(1) 75,009
88,000 ASM Pacific Technology Limited
ORD 311,684
8,700 Asyst Technologies, Inc.(1) 349,903
4,900 Brooks Automation, Inc.(1) 195,388
4,000 Canon, Inc. ORD 183,891
23,100 Cypress Semiconductor Corp.(1) 971,644
15,900 Exar Corp.(1) 1,091,634
11,100 Hyundai Electronics Industries
Co. ORD(1) 172,961
5,900 Integrated Device Technology, Inc.(1) 280,619
23,600 Intel Corp. 2,943,362
2,900 International Rectifier Corp.(1) 119,625
8,100 Kopin Corp.(1) 573,581
2,000 Kulicke & Soffa Industries, Inc.(1) 100,750
1,400 KYOCERA CORP. ORD 232,014
21,500 Lam Research Corp.(1) 691,359
6,800 Linear Technology Corp. 401,412
2,800 LSI Logic Corp.(1) 147,525
6,000 Maxim Integrated Products, Inc.(1) 380,438
307,000 Music Corporation ORD(1) 36,710
3,300 National Semiconductor Corp.(1) 177,375
4,900 Pericom Semiconductor Corp.(1) 200,900
1,100 PMC-Sierra, Inc.(1) 168,609
4,800 Power Integrations, Inc.(1) 112,500
9,200 PRI Automation, Inc.(1) 472,938
10,400 REMEC, Inc.(1) 352,950
7,100 SanDisk Corp.(1) 413,353
12,200 Sawtek Inc.(1) 784,231
9,000 STMicroelectronics N.V. New
York Shares 538,875
67,840 Taiwan Semiconductor
Manufacturing Co. Ltd. ORD 345,696
1,600 Teradyne, Inc.(1) 137,600
22,200 Texas Instruments Inc. 1,603,950
103,200 United Microelectronics Corp.
ORD(1) 313,184
67,710 Winbond Electronics Corp. ORD(1) 204,383
7,500 Xilinx, Inc.(1) 570,703
------------
16,032,647
------------
SPECIALTY STORES -- 0.9%
1,800 Best Buy Co., Inc.(1) 115,200
7,790 Folli-Follie Abee ORD 172,039
5,200 Hennes & Mauritz AB Cl B ORD 131,694
28,650 Home Depot, Inc. 1,398,478
13,200 NBTY, Inc.(1) 210,788
Shares Value
--------------------------------------------------------------------------------
35,900 Office Depot, Inc.(1) $ 253,544
55,700 Profurn Limited ORD 30,432
900 Ryohin Keikaku Co. Limited ORD 130,883
3,300 Zale Corp.(1) 125,400
------------
2,568,458
------------
TELEPHONE -- 4.4%
19,000 AT&T Corp. 659,062
7,700 Bell Atlantic Corp. 407,138
16,800 BellSouth Corp. 784,350
7,600 Century Telephone Enterprises, Inc. 205,200
5,712 COLT Telecom Group plc ORD(1) 201,836
3,750 Covad Communications Group,
Inc.(1) 89,180
10,000 Embratel Participacoes S.A. ADR 209,375
4,391 Energis plc ORD(1) 167,063
36,300 GTE Corp. 2,295,975
6 Japan Telecom Co. Ltd. ORD 263,046
10,700 Magyar Tavkozlesi Rt. ORD 74,287
15,900 McLeodUSA Inc. Cl A(1) 318,497
5,900 NEXTLINK Communications, Inc.
Cl A(1) 413,553
993 NTL Inc.(1) 58,711
9,700 Rostelecom ADR 147,319
23,900 SBC Communications Inc. 1,044,131
2,600 SK Telecom Co., Ltd. ADR 104,162
700 SK Telecom Co., Ltd. ORD 238,601
10,089 Sonera Group Oyj ORD 512,333
34,400 Sprint Corp. 2,081,200
2,600 Tele Danmark A/S ORD 184,023
26,300 Telecom Italia SpA ORD 364,017
22,621 Telefonica S.A. ORD(1) 465,414
11,500 Telefonos de Mexico, S.A. Cl L
ADR 559,906
26,300 Telekomunikacja Polska S.A.
ORD (Acquired 2/17/00, Cost
$227,495)(1)(2) 184,758
32,781 TeleWest Communications plc
ORD(1) 133,559
86 Telinfo NV-Strips ORD 1
1,600 U S WEST, Inc. 115,200
3,375 United Pan-Europe
Communications NV ORD(1) 87,650
------------
12,369,547
------------
TOBACCO -- 0.2%
40,100 UST Inc. 666,662
------------
WIRELESS TELECOMMUNICATIONS -- 2.7%
15,500 Advanced Info Service Public Co.
Limited ORD(1) 178,047
7,000 ALLTEL Corp. 458,062
5,700 Audiovox Corp. Cl A(1) 107,766
22,590 Cable & Wireless plc ORD 377,289
84,000 China Telecom (Hong Kong) Ltd.
ORD(1) 627,911
4,191 Egyptian Mobile Phone Network
ORD(1) 172,175
See Notes to Financial Statements www.americancentury.com 43
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Shares/Principal Amount Value
--------------------------------------------------------------------------------
1,400 Golden Telecom Inc.(1) $ 41,956
15,500 Grupo Iusacell S.A. de C.V.
Series L ADR(1) 205,375
2,690 Korea Telecom Corporation ORD 200,053
27,100 LCC International, Inc. Cl A(1) 400,572
3,175 NetCom Systems AB Cl B ORD(1) 224,934
1,200 Nextel Communications, Inc.(1) 111,112
9 NTT Mobile Communications
Network, Inc. ORD 231,903
26,200 QUALCOMM Inc.(1) 1,738,206
18,200 Sprint PCS(1) 1,010,100
10,500 Tele Centro Oeste Celular
Participacoes SA ADR 106,969
19,886 Tele Norte Leste Participacoes
S.A. Rights ORD(1) 63
9,552 Telecel-Comunicacaoes Pessoais,
SA ORD 155,435
3,000 Telekomunikacja Polska S.A. ORD 21,092
4,200 Videsh Sanchar Nigam Ltd. GDR 65,625
241,707 Vodafone AirTouch PLC ORD 1,104,261
------------
7,538,906
------------
TOTAL COMMON STOCKS & RIGHTS 204,659,705
------------
(Cost $165,041,572)
PREFERRED STOCKS -- 0.5%
BANKS -- 0.1%
37,030,000 Banco Bradesco SA ORD 250,999
------------
MINING & METALS -- 0.1%
43,000 Usinas Siderurgicas de Minas
Gerais S.A. Cl A ORD 188,804
------------
OIL SERVICES -- 0.2%
3,000,000 Petroleo Brasileiro S.A. ORD 699,780
------------
TELEPHONE -- 0.1%
12,039,306 Tele Norte Leste Participacoes
S.A. ORD 237,879
------------
WIRELESS TELECOMMUNICATIONS(3)
25,700,000 Telemig Celular Participacoes
SA ORD 74,759
------------
TOTAL PREFERRED STOCKS 1,452,221
------------
(Cost $1,546,476)
U.S. TREASURY SECURITIES -- 4.5%
$2,300,000 U.S. Treasury Notes, 6.00%,
8/15/00 2,300,720
400,000 U.S. Treasury Notes, 4.875%,
3/31/01 394,250
4,000,000 U.S. Treasury Notes, 6.375%,
1/31/02 3,976,252
500,000 U.S. Treasury Notes, 5.875%,
11/15/04 486,406
1,000,000 U.S. Treasury Bonds, 9.25%,
2/15/16 1,275,313
Principal Amount Value
--------------------------------------------------------------------------------
$2,500,000 U.S. Treasury Bonds, 7.875%,
2/15/21 $ 2,923,438
300,000 U.S. Treasury Bonds, 6.125%,
11/15/27 294,000
1,000,000 U.S. Treasury Bonds, 6.25%,
5/15/30 1, 031,875
------------
TOTAL U.S. TREASURY SECURITIES 12,682,254
------------
(Cost $12,614,126)
U.S. GOVERNMENT AGENCY SECURITIES -- 2.3%
400,000 FHLMC MTN, 6.50%, 1/19/01 398,651
300,000 FNMA, 7.25%, 5/25/01 300,413
1,200,000 FNMA, 5.25%, 1/15/03 1,142,210
1,200,000 FNMA, 7.125%, 2/15/05 1,188,181
350,000 FNMA, 7.125%, 1/15/30 341,162
1,000,000 FNMA MTN, 6.23%, 7/21/08 913,355
2,250,000 FNMA, Series B, 7.25%,
1/15/10 2,215,737
------------
TOTAL U.S. GOVERNMENT
AGENCY SECURITIES 6,499,709
------------
(Cost $6,639,856)
U.S. GOVERNMENT AGENCY DISCOUNT NOTES(5) -- 2.0%
590,000 FHLMC Discount Notes, 6.55%,
8/3/00 583,309
920,000 FHLMC Discount Notes, 6.55%,
8/17/00 907,248
4,200,000 FNMA Discount Notes, 6.32%,
6/1/00 4,200,000
------------
TOTAL U.S. GOVERNMENT
AGENCY DISCOUNT NOTES 5,690,557
------------
(Cost $5,689,611)
SOVEREIGN GOVERNMENTS & AGENCIES -- 0.3%
100,000 Province of Quebec, 8.80%,
4/15/03 103,512
700,000 Province of Quebec, 5.75%,
2/15/09 612,770
100,000 Province of Quebec, 7.50%,
9/15/29 95,508
518,000 United Mexican States
Recoverable Rights, 6/30/03 --
------------
TOTAL SOVEREIGN GOVERNMENTS
& AGENCIES 811,790
------------
(Cost $813,718)
MORTGAGE-BACKED SECURITIES(6) -- 3.5%
66,246 FHLMC Pool #E68523, 6.50%,
12/1/12 63,111
452,449 FHLMC Pool #E00724, 7.00%,
6/1/14 438,351
293,282 FHLMC Pool #C30257, 7.00%,
8/1/29 278,844
44 1-800-345-2021 See Notes to Financial Statements
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
$ 190,248 FNMA Pool #377181, 6.50%,
4/1/12 $ 181,188
58,150 FNMA Pool #250576, 7.00%,
6/1/26 55,407
424,748 FNMA Pool #373510, 7.50%,
3/1/27 413,692
343,899 FNMA Pool #412562, 6.50%,
1/1/28 319,043
245,249 FNMA Pool #482459, 7.00%,
1/1/29 232,954
982,204 FNMA Pool #492315, 6.50%,
4/1/29 909,523
1,496,607 FNMA Pool #498034, 6.00%,
5/1/29 1,344,890
740,230 FNMA Pool #252645, 6.50%,
8/1/29 685,455
1,050,515 FNMA Pool #252923, 6.50%,
12/1/29 972,779
998,028 FNMA Pool #253112, 7.00%,
3/1/30 947,652
400,000 FNMA Pool #537234, 7.00%,
5/1/30 379,688
150,000 FNMA REMIC, Series 1997-58,
Class PB PAC, 6.50%,
6/18/24 140,224
49,421 GNMA Pool #397233, 9.50%,
2/20/25 51,060
20,117 GNMA Pool #392995, 8.75%,
3/15/25 20,541
90,174 GNMA Pool #416856, 7.50%,
10/15/25 88,793
271,107 GNMA Pool #398509, 6.00%,
3/15/26 247,413
107,524 GNMA Pool #372335, 7.50%,
4/15/26 105,809
63,516 GNMA Pool #402682, 7.50%,
6/15/26 62,503
252,532 GNMA Pool #457351, 7.00%,
12/15/27 242,657
333,903 GNMA Pool #436194, 6.50%,
2/15/28 312,608
259,193 GNMA Pool #403770, 6.50%,
3/15/28 242,663
564,395 GNMA Pool #466804, 6.50%,
4/15/28 528,401
600,000 GNMA Pool #507542, 7.00%,
8/15/29 576,111
200,000 GNMA Pool #477038, 7.50%,
5/15/30 196,492
------------
TOTAL MORTGAGE-BACKED SECURITIES 10,037,852
------------
(Cost $10,296,359)
ASSET-BACKED SECURITIES(6) -- 0.6%
400,000 Americredit Automobile
Receivables Trust, Series
1999 D, Class A3 SEQ, 7.02%,
12/12/05 395,478
Principal Amount Value
--------------------------------------------------------------------------------
$ 300,000 CIT RV Trust, Series 1998 A,
Class A4 SEQ, 6.09%,
2/15/12 $ 289,178
100,000 Comed Transitional Funding Trust,
Series 1998-1, Class A6 SEQ,
5.63%, 6/25/09 90,104
300,000 GMAC Commercial Mortgage
Securities Inc., Series 1999 C1,
Class A2 SEQ, 6.18%,
5/15/33 267,547
200,000 Money Store (The) Home Equity
Trust, Series 1997 C, Class AF6
SEQ, 6.67%, 2/15/25 196,089
90,617 Nationslink Funding Corp.,
Series 1998-2, Class A1 SEQ,
6.00%, 11/20/07 84,960
200,000 Nationslink Funding Corp.,
Series 1999-1, Class A2 SEQ,
6.32%, 11/20/08 181,573
10,695 Textron Financial Corp.
Receivables Trust,
Series 1997 A, Class A, 6.05%,
3/16/09 (Acquired 9/18/97,
Cost $10,681)(2) 10,660
177,147 Morgan Stanley Capital I,
Series 1998 WF1, Class A1
SEQ, 6.25%, 7/15/07 169,676
------------
TOTAL ASSET-BACKED SECURITIES 1,685,265
------------
(Cost $1,776,567)
CORPORATE BONDS -- 7.3%
AIRLINES -- 0.2%
500,000 Atlas Air, Inc., 10.75%, 8/1/05 507,500
150,000 United Air Lines, 9.00%,
12/15/03 146,171
------------
653,671
------------
BANKS -- 0.7%
500,000 Abbey National Treasury Services
PLC MTN, Series 1A, VRN,
6.25%, 7/24/00, resets
quarterly off the 3-month
LIBOR minus 0.07% with
no caps 499,634
800,000 Bank of America Corp., 7.80%,
2/15/10 780,071
300,000 Bank of America N.A., VRN,
6.52%, 8/3/00, resets
quarterly off the 3-month
LIBOR plus 0.02% with no caps 299,835
300,000 Citigroup Inc., 7.125%, 5/15/06 289,542
------------
1,869,082
------------
CHEMICALS -- 0.3%
500,000 Huntsman ICI Chemicals, 11.80%,
12/31/09(7) 155,000
500,000 Lyondell Chemical Co., Series B,
9.875%, 5/1/07 483,750
See Notes to Financial Statements www.americancentury.com 45
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
$ 500,000 United Industries Corp., Series B,
9.875%, 4/1/09 (Acquired
8/16/99-2/1/00, Cost
$440,625)(2) $ 355,000
------------
993,750
------------
DEFENSE/AEROSPACE -- 0.2%
500,000 Raytheon Co., 8.20%, 3/1/06
(Acquired 3/3/00, Cost
$504,080)(2) 496,348
------------
DEPARTMENT STORES -- 0.2%
600,000 Wal-Mart Stores, Inc., 6.875%,
8/10/09 573,498
------------
ELECTRICAL EQUIPMENT -- 0.1%
250,000 Trench Electric & Trench Inc.,
10.25%, 12/15/07 176,250
------------
ELECTRICAL UTILITIES -- 0.1%
150,000 Cilcorp, Inc., 8.70%, 10/15/09 146,568
200,000 Southern Investments UK, 6.80%,
12/1/06 182,246
------------
328,814
------------
ENERGY RESERVES & PRODUCTION -- 0.3%
250,000 Belco Oil & Gas Corp., Series B,
10.50%, 4/1/06 252,500
500,000 EOG Resources Inc., 6.70%,
11/15/06 463,322
------------
715,822
------------
ENVIRONMENTAL SERVICES -- 0.1%
500,000 Allied Waste Industries, Inc.,
Series B, 10.00%, 8/1/09 397,500
------------
EQUITY REAL ESTATE
INVESTMENT TRUST -- 0.1%
275,000 Spieker Properties, Inc., 6.80%,
12/15/01 269,438
------------
FINANCIAL SERVICES -- 0.5%
110,000 Ford Motor Credit Co., 6.85%,
8/15/00 109,936
700,000 Ford Motor Credit Co., 7.50%,
3/15/05 687,514
400,000 General Motors Acceptance Corp.
MTN, VRN, 6.28%, 6/12/00,
resets quarterly off the 3-month
LIBOR plus 0.15% with
no caps 399,285
250,000 Nationwide Credit, Inc., Series A,
10.25%, 1/15/08 176,250
------------
1,372,985
------------
FOOD & BEVERAGE(3)
150,000 Pepsi Bottling Group Inc.,
Series B, 7.00%, 3/1/29
(Acquired 3/3/99, Cost
$148,980)(2) 130,544
------------
Principal Amount Value
--------------------------------------------------------------------------------
FOREST PRODUCTS & PAPER -- 0.5%
$ 150,000 Fort James Corp., 6.625%,
9/15/04 $ 142,002
750,000 Repap New Brunswick, 10.625%,
4/15/05 675,000
500,000 Riverwood International, 10.875%,
4/1/08 466,250
------------
1,283,252
------------
GAS & WATER UTILITIES -- 0.2%
500,000 Azurix Corp., 10.375%, 2/15/07
(Acquired 2/28/00, Cost
$505,000)(2) 467,500
------------
HEAVY ELECTRICAL EQUIPMENT -- 0.1%
350,000 Anixter International Inc., 8.00%,
9/15/03 338,905
------------
HOTELS -- 0.4%
500,000 Hollywood Casino Corp., 11.25%,
5/1/07 507,500
500,000 Venetian Casino/Las Vegas
Sands, 12.25%, 11/15/04 487,500
------------
995,000
------------
INDUSTRIAL PARTS(3)
100,000 Petroleum Geo-Services ASA,
6.625%, 3/30/08 86,938
------------
INTERNET -- 0.2%
500,000 PSINet Inc., Series B, 10.00%,
2/15/05 445,000
------------
LIFE & HEALTH INSURANCE -- 0.1%
100,000 Aetna Services, Inc., 6.75%,
8/15/01 98,721
200,000 Conseco Inc., 6.40%, 6/15/01 151,000
------------
249,721
------------
MEDIA -- 0.7%
250,000 AMFM Inc., 8.00%, 11/1/08 250,625
500,000 Charter Communications
Holdings LLC, 8.625%, 4/1/09
(Acquired 3/12/99, Cost
$498,475)(2) 420,000
600,000 CSC Holdings Inc., Series B,
8.125%, 7/15/09 564,756
100,000 Liberty Media Group, 8.25%,
2/1/30 (Acquired 1/26/00,
Cost $99,199)(2) 86,055
500,000 RCN Corp., 11.35%, 10/15/07(8) 292,500
150,000 TCI Communications, Inc., 8.75%,
8/1/15 158,088
100,000 Tele-Communications Inc., 8.25%,
1/15/03 101,593
------------
1,873,617
------------
MOTOR VEHICLES & PARTS -- 0.5%
600,000 DaimlerChrysler AG, 7.125%,
3/1/02 596,873
46 1-800-345-2021 See Notes to Financial Statements
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
$ 515,000 Oxford Automotive Inc., Series D,
10.125%, 6/15/07 (Acquired
2/15/00-2/25/00, Cost
$488,088)(2) $ 484,100
500,000 Sonic Automotive, Inc., Series B,
11.00%, 8/1/08 457,500
------------
1,538,473
------------
MULTI-INDUSTRY -- 0.2%
100,000 Hutchison Whampoa Financial,
Series B, 7.45%, 8/1/17
(Acquired 6/4/98 - 11/19/99,
Cost $91,371)(2) 86,798
600,000 Tyco International Group SA,
6.875%, 9/5/02 (Acquired
1/11/00 - 3/8/00, Cost
$590,755)(2) 587,923
------------
674,721
------------
OIL REFINING -- 0.1%
200,000 USX Corp., 6.65%, 2/1/06 185,434
------------
OIL SERVICES(3)
100,000 Gulf Canada Resources Ltd.,
8.35%, 8/1/06 97,250
------------
SECURITIES & ASSET MANAGEMENT -- 0.1%
400,000 Morgan Stanley Dean Witter & Co.,
7.125%, 1/15/03 394,456
------------
SEMICONDUCTOR -- 0.1%
250,000 DII Group, Inc., 8.50%, 9/15/07
(Acquired 9/17/97, Cost
$250,000)(2) 253,750
------------
TELEPHONE -- 0.9%
250,000 Covad Communications Group,
Inc., 12.00%, 2/15/10
(Acquired 1/21/00, Cost
$250,000)(2) 231,250
250,000 Global Crossing Holdings Ltd.,
9.625%, 5/15/08 238,750
150,000 GTE North Inc., Series H, 5.65%,
11/15/08 128,758
150,000 KPNQwest B.V., 8.125%, 6/1/09 137,250
500,000 Viatel, Inc., 11.25%, 4/15/08 390,000
500,000 Williams Communication Group
Inc., 10.875%, 10/1/09 503,750
500,000 WorldCom, Inc., 7.875%,
5/15/03 499,142
400,000 WorldCom, Inc., VRN, 6.94%,
8/17/00, resets quarterly off
the 3-month LIBOR plus 0.18%
with no caps (Acquired
5/11/00, Cost $400,176)(2) 400,010
------------
2,528,910
------------
THRIFTS -- 0.1%
500,000 Bay View Capital Corp., 9.125%,
8/15/02 387,500
------------
Principal Amount Value
--------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATIONS -- 0.3%
$ 250,000 AT&T Canada Inc., 7.76%,
6/15/08(8) $ 201,659
250,000 Nextel Communications, Inc.,
9.375%, 11/15/09 236,250
500,000 Nextel Partners Inc., 11.00%,
3/15/10 472,500
------------
910,409
------------
TOTAL CORPORATE BONDS 20,688,538
------------
(Cost $21,530,404)
COMMERCIAL PAPER(5) -- 1.5%
CREDIT CARD & TRADE RECEIVABLES -- 0.1%
300,000 WCP Funding Inc., 6.07%,
6/7/00 (Acquired 4/11/00,
Cost $297,117)(2) 299,618
------------
ENERGY RESERVES & PRODUCTION -- 0.1%
300,000 Chevron Transport Corp., 5.95%,
6/2/00 (Acquired 2/24/00,
Cost $295,091)(2) 299,890
------------
FINANCIAL SERVICES -- 0.3%
300,000 AIG Funding Corp., 6.02%,
6/5/00 299,727
300,000 Fortis Funding LLC, 6.10%,
6/23/00 (Acquired 4/5/00,
Cost $295,984)(2) 298,754
300,000 General Electric Capital Corp.,
6.55%, 7/12/00 297,713
------------
896,194
------------
FOOD & BEVERAGE -- 0.1%
300,000 Brown-Forman Corp., 6.63%,
8/16/00 (Acquired 5/15/00,
Cost $294,917)(2) 295,751
------------
INDUSTRIAL PARTS -- 0.1%
300,000 Invensys plc, 6.33%, 7/27/00
(Acquired 4/28/00, Cost
$295,411)(2) 296,875
------------
LIFE & HEALTH INSURANCE -- 0.3%
300,000 Allianz of America Inc., 6.09%,
6/16/00 (Acquired 3/20/00,
Cost $295,534)(2) 299,133
300,000 Allianz of America Inc., 6.15%,
7/5/00 298,100
300,000 Prudential Funding Corp., 6.09%,
6/5/00 299,727
------------
896,960
------------
PROPERTY & CASUALTY INSURANCE -- 0.2%
500,000 Aegon Funding Corp., 6.64%,
8/17/00 (Acquired 5/18/00,
Cost $491,700)(2) 492,825
------------
See Notes to Financial Statements www.americancentury.com 47
Strategic Aggressive--Schedule of Investments
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
Principal Amount Value
--------------------------------------------------------------------------------
SECURITIES & ASSET MANAGEMENT -- 0.3%
$ 500,000 Merrill Lynch & Co., Inc., 6.65%,
8/23/00 $ 492,260
300,000 Morgan Stanley Dean Witter & Co.,
6.10%, 6/20/00 298,917
------------
791,177
------------
TOTAL COMMERCIAL PAPER 4,269,290
------------
(Cost $4,270,496)
CERTIFICATES OF DEPOSIT -- 0.1%
350,000 Canadian Imperial Bank of
Commerce (New York), 6.11%,
6/16/00 349,924
------------
(Cost $350,001)
FORWARD COMMITMENTS -- 0.4%
1,200,000 FNMA Purchase, 7.50%,
settlement 6/19/00 1,182,746
------------
(Cost $1,175,625)
TEMPORARY CASH INVESTMENTS -- 5.0%
Repurchase Agreement, Merrill Lynch & Co.,
Inc., (U.S. Treasury obligations), in a joint
trading account at 6.25%, dated 5/31/00,
due 6/1/00 (Delivery value $14,102,448) $ 14,100,000
------------
(Cost $14,100,000)
TOTAL INVESTMENT SECURITIES -- 100.0% $284,109,851
============
(Cost $245,844,811)
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
Contracts Settlement Unrealized
to Sell Date Value Gain
-------------------------------------------------------------------------------
76,007,400 JPY 6/30/00 $708,224 $8,546
======================================
(Value on Settlement Date $716,770)
Forward foreign currency exchange contracts appear at the end of the schedule of
investments. These contracts are designed to protect the fund's foreign
investments against declines in foreign currencies (also known as hedging). The
contracts are called "forward" because they allow the fund to exchange a foreign
currency for U.S. dollars on a specific date in the future--and at a prearranged
exchange rate.
NOTES TO SCHEDULE OF INVESTMENTS
Notes to Schedule of Investments
ADR = American Depositary Receipt
FHLMC = Federal Home Loan Mortgage Corporation
FNMA = Federal National Mortgage Association
GDR = Global Depositary Receipt
GNMA = Government National Mortgage Association
JPY = Japanese Yen
LIBOR = London Interbank Offered Rate
MTN = Medium Term Note
ORD = Foreign Ordinary Share
resets = The frequency with which a security's coupon changes, based on current
market conditions or an underlying index. The more frequently a security resets,
the less risk the investor is taking that the coupon will vary significantly
from current market rates.
VRN = Variable Rate Note. Interest reset date is indicated and used in
calculating the weighted average portfolio maturity. Rate shown is effective May
31, 2000.
(1) Non-income producing.
(2) Security was purchased under Rule 144A or Section 4(2) of the Securities
Act of 1933 or is a private placement and, unless registered under the Act
or exempted from registration, may only be sold to qualified institutional
investors. The aggregate value of restricted securities at May 31, 2000,
was $6,663,586, which represented 2.4% of net assets.
(3) Industry is less than 0.05% of total investment securities.
(4) Security, or a portion thereof, has been segregated at the custodian bank
for Forward Commitments.
(5) Rates indicated are the yield to maturity at purchase.
(6) Final maturity indicated. Expected remaining maturity used for purposes of
calculating the weighted average portfolio maturity.
(7) Security is a zero-coupon bond. The yield to maturity at purchase is
indicated. Zero coupon securities are purchased at a substantial discount
from their value at maturity.
(8) Step-coupon security. Yield to maturity at purchase is indicated. These
securities become interest bearing at a predetermined rate and future date
and are purchased at a substantial discount from their value at maturity.
48 1-800-345-2021 See Notes to Financial Statements
<TABLE>
<CAPTION>
Statements of Assets and Liabilities
--------------------------------------------------------------------------------
This statement breaks down the fund's ASSETS (such as securities, cash, and
other receivables) and LIABILITIES (money owed for securities purchased,
management fees, and other liabilities) as of the last day of the reporting
period. Subtracting the liabilities from the assets results in the fund's NET
ASSETS. For each class of shares, the net assets divided by shares outstanding
is the share price, or NET ASSET VALUE PER SHARE. This statement also breaks
down the fund's net assets into capital (shareholder investments) and
performance (investment income and gains/losses).
STRATEGIC STRATEGIC STRATEGIC
ALLOCATION: ALLOCATION: ALLOCATION:
MAY 31, 2000 (UNAUDITED) CONSERVATIVE MODERATE AGGRESSIVE
ASSETS
<S> <C> <C> <C>
Investment securities, at value
(identified cost of $168,577,937,
$409,600,631, and $245,844,811,
respectively) (Note 3) .............. $179,875,262 $452,055,873 $284,109,851
Foreign currency holdings, at value
(identified cost of $0, $697,397,
and $469,221, respectively) ......... -- 693,090 466,472
Receivable for investments sold ....... 300,746 1,994,554 1,528,246
Receivable for forward
foreign currency contracts .......... 3,795 11,618 8,546
Dividends and interest receivable ..... 1,448,688 2,510,479 1,194,615
------------ ------------ ------------
181,628,491 457,265,614 287,307,730
------------ ------------ ------------
LIABILITIES
Disbursements in excess
of demand deposit cash .............. 150,060 1,743,458 69,587
Payable for investments purchased ..... 1,263,630 5,645,371 3,896,035
Accrued management fees (Note 2) ...... 148,729 413,422 281,851
Distribution fees payable (Note 2) .... 2,298 4,078 4,061
Service fees payable (Note 2) ......... 2,298 4,078 4,061
Payable for directors' fees
and expenses ........................ 94 229 150
Accrued expenses and
other liabilities ................... 450 1,253 1,986
------------ ------------ ------------
1,567,559 7,811,889 4,257,731
------------ ------------ ------------
Net Assets ............................ $180,060,932 $449,453,725 $283,049,999
============ ============ ============
NET ASSETS CONSIST OF:
Capital (par value and paid-in surplus) $160,797,149 $367,170,935 $217,931,400
Undistributed net investment income ... 1,089,113 1,974,278 1,231,213
Accumulated undistributed net
realized gain on investment
and foreign currency transactions ... 6,876,779 37,858,392 25,624,638
Net unrealized appreciation on
investments and translation
of assets and liabilities in
foreign currencies (Note 3) ......... 11,297,891 42,450,120 38,262,748
------------ ------------ ------------
$180,060,932 $449,453,725 $283,049,999
============ ============ ============
Investor Class, $0.01 Par Value
Net assets ............................ $168,942,291 $430,924,823 $263,076,647
Shares outstanding .................... 29,883,028 60,052,308 31,622,546
Net asset value per share ............. $ 5.65 $ 7.18 $ 8.32
Advisor Class, $0.01 Par Value
Net assets ............................ $ 11,118,641 $ 18,528,902 $ 19,973,352
Shares outstanding .................... 1,967,569 2,582,975 2,404,300
Net asset value per share ............. $ 5.65 $ 7.17 $ 8.31
</TABLE>
See Notes to Financial Statements www.americancentury.com 49
<TABLE>
<CAPTION>
Statements of Operations
--------------------------------------------------------------------------------
This statement shows how the fund's net assets changed during the reporting
period as a result of the fund's operations. In other words, it shows how much
money the fund made or lost as a result of dividend and interest income, fees
and expenses, and investment gains or losses.
FOR THE SIX MONTHS ENDED MAY 31, 2000 (UNAUDITED)
STRATEGIC STRATEGIC STRATEGIC
ALLOCATION: ALLOCATION: ALLOCATION:
CONSERVATIVE MODERATE AGGRESSIVE
INVESTMENT INCOME
Income:
<S> <C> <C> <C>
Interest ................................. $3,129,413 $5,326,051 $1,820,172
Dividends (net of foreign taxes
withheld of $11,117, $39,102,
and $27,404, respectively) ............. 597,617 1,621,352 974,645
-------------- --------------- --------------
3,727,030 6,947,403 2,794,817
-------------- --------------- --------------
Expenses (Note 2):
Management fees .......................... 879,045 2,390,322 1,542,086
Distribution fees -- Advisor Class ....... 11,645 22,973 20,293
Service fees -- Advisor Class ............ 11,645 22,973 20,293
Directors' fees and expenses ............. 511 1,233 761
-------------- --------------- --------------
902,846 2,437,501 1,583,433
-------------- --------------- --------------
Net investment income .................... 2,824,184 4,509,902 1,211,384
-------------- --------------- --------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN
CURRENCY (NOTE 3)
Net realized gain on:
Investments .............................. 8,770,247 41,670,262 27,390,438
Foreign currency transactions ............ 38,489 175,250 100,329
-------------- --------------- --------------
8,808,736 41,845,512 27,490,767
-------------- --------------- --------------
Change in net unrealized
appreciation on:
Investments .............................. (4,678,435) (16,685,340) (8,396,183)
Translation of assets and liabilities
in foreign currencies .................. 24,622 75,221 40,177
-------------- --------------- --------------
(4,653,813) (16,610,119) (8,356,006)
-------------- --------------- --------------
Net realized and unrealized gain
on investments and foreign currency ...... 4,154,923 25,235,393 19,134,761
-------------- --------------- --------------
Net Increase in Net Assets
Resulting from Operations .............. $6,979,107 $29,745,295 $20,346,145
============== =============== ==============
</TABLE>
50 1-800-345-2021 See Notes to Financial Statements
<TABLE>
<CAPTION>
Statements of Changes in Net Assets
--------------------------------------------------------------------------------
This statement shows how the fund's net assets changed over the past two
reporting periods. It details how much a fund grew or shrank as a result of
operations (as detailed on the previous page for the most recent period), income
and capital gain distributions, and shareholder investments and redemptions.
SIX MONTHS ENDED MAY 31, 2000 (UNAUDITED) AND YEAR ENDED NOVEMBER 30, 1999
STRATEGIC ALLOCATION: STRATEGIC ALLOCATION: STRATEGIC ALLOCATION:
Increase (Decrease) in CONSERVATIVE MODERATE AGGRESSIVE
Net Assets 2000 1999 2000 1999 2000 1999
OPERATIONS
<S> <C> <C> <C> <C> <C> <C>
Net investment income .......... $2,824,184 $5,655,649 $4,509,902 $6,270,107 $1,211,384 $1,776,191
Net realized gain on
investments and foreign
currency transactions ........ 8,808,736 5,117,097 41,845,512 8,548,239 27,490,767 9,119,092
Change in net unrealized
appreciation on investments
and translation of assets
and liabilities in
foreign currencies ...........(4,653,813) 4,525,537 (16,610,119) 37,133,255 (8,356,006) 30,214,139
------------ ------------ ------------ ------------ ------------ -----------
Net increase in net assets
resulting from operations .... 6,979,107 15,298,283 29,745,295 51,951,601 20,346,145 41,109,422
------------ ------------ ------------ ------------ ------------ -----------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income:
Investor Class ...............(2,504,678) (5,376,570) (3,716,805) (5,791,290) (1,910,467) (1,746,451)
Advisor Class ................ (122,200) (185,153) (138,907) (245,892) (101,910) (97,114)
From net realized gains on
investment transactions:
Investor Class ...............(5,383,843) (5,992,784) (9,774,558) (9,046,771) (8,806,307) (3,801,607)
Advisor Class ................ (281,260) (213,170) (417,334) (452,461) (602,407) (264,507)
------------ ------------ ------------ ------------ ------------ -----------
Decrease in net assets
from distributions .............(8,291,981) (11,767,677) (14,047,604) (15,536,414) (11,421,091) (5,909,679)
------------ ------------ ------------ ------------ ------------ -----------
CAPITAL SHARE TRANSACTIONS
(NOTE 4)
Net increase (decrease) in
net assets from capital
share transactions ........... 5,414,773 (15,137,581) 42,185,175 80,183,989 67,876,592 15,695,068
------------ ------------ ------------ ------------ ------------ -----------
Net increase (decrease)
in net assets ................ 4,101,899 (11,606,975) 57,882,866 116,599,176 76,801,646 50,894,811
NET ASSETS
Beginning of period ............175,959,033 187,566,008 391,570,859 274,971,683 206,248,353 155,353,542
------------ ------------ ------------ ------------ ------------ ------------
End of period .................$180,060,932 $175,959,033 $449,453,725 $391,570,859 $283,049,999 $206,248,353
============ ============ ============ ============ ============ ============
Undistributed
net investment income ..........$1,089,113 $891,807 $1,974,278 $1,320,088 $1,231,213 $2,032,206
============ ============ ============ ============ ============ ============
</TABLE>
See Notes to Financial Statements www.americancentury.com 51
Notes to Financial Statements
--------------------------------------------------------------------------------
MAY 31, 2000 (UNAUDITED)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION -- American Century Strategic Asset Allocations, Inc. (the
corporation) is registered under the Investment Company Act of 1940 the (1940
Act) as an open-end management investment company. Strategic Allocation:
Conservative Fund, Strategic Allocation: Moderate Fund and Strategic Allocation:
Aggressive Fund (the funds) are the funds currently issued by the corporation.
The funds are diversified under the 1940 Act. The funds' investment objective is
to provide as high a level of total return (capital appreciation plus dividend
and interest income) as is consistent with each fund's risk profile. The funds
seek to achieve this by diversifying investments among three asset classes --
equity securities, bonds and cash equivalent instruments, the mix of which will
depend on the risk profile of each fund. The following significant accounting
policies are in accordance with generally accepted accounting principles; these
policies may require the use of estimates by fund management.
MULTIPLE CLASS -- The funds are authorized to issue two classes of shares:
the Investor Class and the Advisor Class. The two classes of shares differ
principally in their respective shareholder servicing and distribution expenses
and arrangements. All shares of each fund represent an equal pro rata interest
in the assets of the class to which such shares belong, and have identical
voting, dividend, liquidation and other rights and the same terms and
conditions, except for class specific expenses and exclusive rights to vote on
matters affecting only individual classes.
SECURITY VALUATIONS -- Portfolio securities traded primarily on a principal
securities exchange are valued at the last reported sales price, or at the mean
of the latest bid and asked prices where no last sales price is available.
Securities traded over-the-counter are valued at the mean of the latest bid and
asked prices or, in the case of certain foreign securities, at the last reported
sales price, depending on local convention or regulation. Debt securities not
traded on a principal securities exchange are valued through a commercial
pricing service or at the mean of the most recent bid and asked prices. When
valuations are not readily available, securities are valued at fair value as
determined in accordance with procedures adopted by the Board of Directors.
SECURITY TRANSACTIONS -- Security transactions are accounted for as of the
trade date. Net realized gains and losses are determined on the identified cost
basis, which is also used for federal income tax purposes.
INVESTMENT INCOME -- Dividend income less foreign taxes withheld (if any) is
recorded as of the ex-dividend date. Interest income is recorded on the accrual
basis and includes accretion of discounts and amortization of premiums.
FOREIGN CURRENCY TRANSACTIONS -- All assets and liabilities initially
expressed in foreign currencies are translated into U.S. dollars at prevailing
exchange rates at period end. Purchases and sales of investment securities,
dividend and interest income, and certain expenses are translated at the rates
of exchange prevailing on the respective dates of such transactions. For assets
and liabilities, other than investments in securities, net realized and
unrealized gains and losses from foreign currency translations arise from
changes in currency exchange rates.
Net realized and unrealized foreign currency exchange gains or losses
occurring during the holding period of investment securities are a component of
realized gain (loss) on investments and unrealized appreciation (depreciation)
on investments, respectively.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS -- The funds may enter into
forward foreign currency exchange contracts to facilitate transactions of
securities denominated in a foreign currency or to hedge the fund's exposure to
foreign currency exchange rate fluctuations. The net U.S. dollar value of
foreign currency underlying all contractual commitments held by the funds and
the resulting unrealized appreciation or depreciation are determined daily using
prevailing exchange rates. The funds bear the risk of an unfavorable change in
the foreign currency exchange rate underlying the forward contract.
Additionally, losses may arise if the counterparties do not perform under the
contract terms.
REPURCHASE AGREEMENTS -- The funds may enter into repurchase agreements with
institutions that the funds' investment manager, American Century Investment
Management, Inc. (ACIM), has determined are creditworthy pursuant to criteria
adopted by the Board of Directors. Each repurchase agreement is recorded at
cost. The funds require that the collateral, represented by securities, received
in a repurchase transaction be transferred to the custodian in a manner
sufficient to enable the funds to obtain those securities in the event of a
default under the repurchase agreement. ACIM monitors, on a daily basis, the
securities transferred to ensure the value, including accrued interest, of the
securities under each repurchase agreement is equal to or greater than amounts
owed to the funds under each repurchase agreement.
JOINT TRADING ACCOUNT -- Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the funds, along with other registered
investment companies having management agreements with ACIM, may transfer
uninvested cash balances into a joint trading account. These balances are
invested in one or more repurchase agreements that are collateralized by U.S.
treasury or agency obligations.
INCOME TAX STATUS -- It is the funds' policy to distribute all net
investment income and net realized gains to shareholders and to otherwise
qualify as a regulated investment company under provisions of the Internal
Revenue Code. Accordingly, no provision has been made for federal or state
income taxes.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions to shareholders are recorded
on the ex-dividend date. Distributions from net investment income are declared
and paid quarterly, with the exception of those for Strategic Allocation:
Aggressive, which are declared and paid annually. Distributions from net
realized gains are declared and paid annually, usually in December, but the
funds may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code, in all events in a
manner consistent with provisions of the 1940 Act.
52 1-800-345-2021
Notes to Financial Statements
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
The character of distributions made during the year from net investment
income or net realized gains may differ from their ultimate characterization for
federal income tax purposes. These differences reflect the differing character
of certain income items and net realized gains and losses for financial
statement and tax purposes and may result in reclassification among certain
capital accounts.
ADDITIONAL INFORMATION -- Funds Distributor, Inc. (FDI) is a distributor of
the corporation. Certain officers of FDI are also officers of the corporation.
--------------------------------------------------------------------------------
2. TRANSACTIONS WITH RELATED PARTIES
The corporation has entered into a Management Agreement with ACIM, under
which ACIM provides each fund with investment advisory and management services
in exchange for a single, unified management fee per class. The Agreement
provides that all expenses of the funds, except brokerage commissions, taxes,
interest, expenses of those directors who are not considered "interested
persons" as defined in the 1940 Act (including counsel fees) and extraordinary
expenses, will be paid by ACIM. The fee is computed daily and paid monthly based
on each class's average daily closing net assets during the previous month. The
annual management fee for each class of the funds is as follows:
STRATEGIC STRATEGIC STRATEGIC
ALLOCATION: ALLOCATION: ALLOCATION:
CONSERVATIVE MODERATE AGGRESSIVE
INVESTOR ADVISOR INVESTOR ADVISOR INVESTOR ADVISOR
AVERAGE NET ASSETS
First $1 billion 1.00% 0.75% 1.10% 0.85% 1.20% 0.95%
Over $1 billion 0.90% 0.65% 1.00% 0.75% 1.10% 0.85%
The Board of Directors has adopted the Advisor Class Master Distribution and
Shareholder Services Plan (the plan), pursuant to Rule 12b-1of the 1940 Act. The
plan provides that the funds will pay ACIM an annual distribution fee equal to
0.25% and service fee equal to 0.25%. The fees are computed daily and paid
monthly based on the Advisor Class's average daily closing net assets during the
previous month. The distribution fee provides compensation for distribution
expenses incurred by financial intermediaries in connection with distributing
shares of the Advisor Class including, but not limited to, payments to brokers,
dealers, and financial institutions that have entered into sales agreements with
respect to shares of the funds. The service fee provides compensation for
shareholder and administrative services rendered by ACIM, its affiliates or
independent third party providers. Fees incurred under the plan during the six
months ended May 31, 2000, were $23,290 in Strategic Allocation: Conservative,
$45,946 in Strategic Allocation: Moderate, and $40,586 in Strategic Allocation:
Aggressive.
Effective March 13, 2000, American Century Investment Services, Inc. (ACIS),
became a distributor of the corporation.
Certain officers and directors of the corporation are also officers and/or
directors, and, as a group, controlling stockholders of American Century
Companies, Inc., the parent of the corporation's investment manager, ACIM, a
distributor of the corporation, ACIS, and the corporation's transfer agent,
American Century Services Corporation.
www.americancentury.com 53
Notes to Financial Statements
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
3. INVESTMENT TRANSACTIONS
Investment transactions, excluding short-term investments, for the six
months ended May 31, 2000, were as follows:
STRATEGIC STRATEGIC STRATEGIC
ALLOCATION: ALLOCATION: ALLOCATION:
CONSERVATIVE MODERATE AGGRESSIVE
PURCHASES
Investment Securities other than
U.S. Government & Agency
Obligations .................... $59,128,185 $222,325,385 $172,628,092
U.S. Government & Agency
Obligations .................... 39,870,168 80,296,692 38,740,614
PROCEEDS FROM SALES
Investment Securities other than
U.S. Government & Agency
Obligations .................... $75,834,862 $244,371,579 $145,744,366
U.S. Government & Agency
Obligations .................... 34,065,193 60,072,012 21,274,248
On May 31, 2000, the composition of unrealized appreciation and depreciation
of investment securities based on the aggregate cost of investments for federal
income tax purposes was as follows:
STRATEGIC STRATEGIC STRATEGIC
ALLOCATION: ALLOCATION: ALLOCATION:
CONSERVATIVE MODERATE AGGRESSIVE
Appreciation ..................... $16,996,919 $56,669,172 $48,224,637
Depreciation ..................... (7,624,210) (18,187,949) (11,814,265)
-------------- ------------- -------------
Net .............................. $9,372,709 $38,481,223 $36,410,372
============== ============= =============
Federal Tax Cost ................. $70,502,553 $413,574,650 $247,699,479
============== ============= =============
54 1-800-345-2021
Notes to Financial Statements
--------------------------------------------------------------------------------
(Continued)
MAY 31, 2000 (UNAUDITED)
--------------------------------------------------------------------------------
4. CAPITAL SHARE TRANSACTIONS
<TABLE>
<CAPTION>
Transactions in shares of the funds were as follows:
STRATEGIC ALLOCATION: STRATEGIC ALLOCATION: STRATEGIC ALLOCATION:
CONSERVATIVE MODERATE AGGRESSIVE
SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT
INVESTOR CLASS
<S> <C> <C> <C> <C> <C> <C>
Authorized shares ....... 100,000,000 100,000,000 100,000,000
============= ============= =============
Six months ended
May 31, 2000
Sold .................... 9,934,997 $56,859,997 14,940,066 $108,754,979 13,261,296 $113,785,363
Issued in reinvestment
of distributions ...... 1,378,468 7,708,845 1,902,444 13,398,698 1,334,072 10,667,439
Redeemed ................ (10,769,049) (61,473,317) (11,307,752) (81,845,102) (7,360,071) (62,518,369)
------------- -------------- ------------- -------------- ------------- -------------
Net increase ............ 544,416 $3,095,525 5,534,758 $40,308,575 7,235,297 $61,934,433
============= ============== ============= ============== ============= =============
Year ended
November 30, 1999
Sold .................... 13,801,866 $76,375,230 27,735,521 $177,453,631 11,259,728 $78,476,409
Issued in reinvestment
of distributions ...... 1,930,163 10,456,958 2,409,483 14,722,174 866,756 5,527,759
Redeemed ................ (18,765,683) (104,022,069) (17,697,620) (113,157,009) (9,933,120) (69,207,390)
------------- -------------- ------------- -------------- ------------- -------------
Net increase (decrease).. (3,033,654) $(17,189,881) 12,447,384 $79,018,796 2,193,364 $14,796,778
============= ============== ============= ============== ============= =============
ADVISOR CLASS
Authorized shares ....... 50,000,000 50,000,000 50,000,000
============= ============= =============
Six months ended
May 31, 2000
Sold .................... 690,242 $3,942,189 926,940 $6,782,546 995,040 $8,492,708
Issued in reinvestment
of distributions ...... 72,167 403,458 78,925 555,369 88,051 703,761
Redeemed ................ (353,839) (2,026,399) (743,596) (5,461,315) (379,562) (3,254,310)
------------- -------------- ------------- -------------- ------------- -------------
Net increase ............ 408,570 $2,319,248 262,269 $1,876,600 703,529 $5,942,159
============= ============== ============= ============== ============= =============
Year ended
November 30, 1999
Sold .................... 925,965 $5,066,512 1,326,437 $8,429,197 884,076 $6,136,284
Issued in reinvestment
of distributions ...... 73,462 398,320 114,335 697,838 56,668 361,429
Redeemed ................ (619,470) (3,412,532) (1,251,844) (7,961,842) (807,547) (5,599,423)
------------- -------------- ------------- -------------- ------------- -------------
Net increase ............ 379,957 $2,052,300 188,928 $1,165,193 133,197 $898,290
============= ============== ============= ============== ============= =============
</TABLE>
--------------------------------------------------------------------------------
5. BANK LOANS
The funds, along with certain other funds managed by ACIM, entered into an
unsecured $620,000,000 bank line of credit agreement with Chase Manhattan Bank.
The funds may borrow money for temporary or emergency purposes to fund
shareholder redemptions. Borrowings under the agreement bear interest at the
Federal Funds rate plus 0.50%. The funds did not borrow from the line during the
six months ended May 31, 2000.
www.americancentury.com 55
Strategic Conservative--Financial Highlights
--------------------------------------------------------------------------------
This table itemizes investment results and distributions on a per-share basis to
illustrate share price changes for each of the last five fiscal years (or less,
if the share class is not five years old). It also includes several key
statistics for each reporting period, including TOTAL RETURN, INCOME RATIO (net
investment income as a percentage of average net assets), EXPENSE RATIO
(operating expenses as a percentage of average net assets), and PORTFOLIO
TURNOVER (a gauge of the fund's trading activity).
<TABLE>
FOR A SHARE OUTSTANDING THROUGHOUT THE YEARS ENDED NOVEMBER 30 (EXCEPT AS NOTED)
Investor Class
2000(1) 1999 1998 1997 1996(2)
PER-SHARE DATA
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ... $ 5.69 $ 5.59 $ 5.55 $ 5.26 $ 5.00
----------- ----------- ----------- ----------- -----------
Income From Investment Operations
Net Investment Income(3) ............. 0.09 0.17 0.18 0.19 0.13
Net Realized and Unrealized Gain
on Investment Transactions ........... 0.15 0.28 0.31 0.36 0.22
----------- ----------- ----------- ----------- -----------
Total From Investment Operations ..... 0.24 0.45 0.49 0.55 0.35
----------- ----------- ----------- ----------- -----------
Distributions
From Net Investment Income ........... (0.09) (0.16) (0.19) (0.17) (0.09)
From Net Realized Gains on
Investment Transactions .............. (0.19) (0.19) (0.26) (0.09) --
----------- ----------- ----------- ----------- -----------
Total Distributions .................. (0.28) (0.35) (0.45) (0.26) (0.09)
----------- ----------- ----------- ----------- -----------
Net Asset Value, End of Period ......... $ 5.65 $ 5.69 $ 5.59 $ 5.55 $ 5.26
=========== =========== =========== =========== ===========
Total Return(4) ...................... 4.17% 8.47% 9.43% 10.87% 7.02%
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to
Average Net Assets ................... 1.00%(5) 1.00% 1.00% 1.00% 1.01%(5)
Ratio of Net Investment Income to
Average Net Assets ................... 3.19%(5) 3.01% 3.35% 3.48% 3.67%(5)
Portfolio Turnover Rate ................ 64% 105% 113% 124% 44%
Net Assets, End of Period
(in thousands) ....................... $ 168,942 $ 167,083 $ 180,970 $ 156,733 $ 33,110
</TABLE>
(1) Six months ended May 31, 2000 (unaudited).
(2) February 15, 1996 (inception) through November 30, 1996.
(3) Computed using average shares outstanding throughout the period.
(4) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(5) Annualized.
56 1-800-345-2021 See Notes to Financial Statements
Strategic Conservative--Financial Highlights
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR A SHARE OUTSTANDING THROUGHOUT THE YEARS ENDED NOVEMBER 30 (EXCEPT AS NOTED)
Advisor Class
2000(1) 1999 1998 1997 1996(2)
PER-SHARE DATA
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period .. $ 5.69 $ 5.59 $ 5.56 $ 5.26 $ 5.09
---------- ---------- ---------- ---------- ----------
Income From Investment Operations
Net Investment Income(3) ............ 0.08 0.15 0.17 0.17 0.03
Net Realized and Unrealized Gain
on Investment Transactions .......... 0.15 0.30 0.31 0.38 0.14
---------- ---------- ---------- ---------- ----------
Total From Investment Operations .... 0.23 0.45 0.48 0.55 0.17
---------- ---------- ---------- ---------- ----------
Distributions
From Net Investment Income .......... (0.08) (0.16) (0.19) (0.16) --
From Net Realized Gains on
Investment Transactions ............. (0.19) (0.19) (0.26) (0.09) --
---------- ---------- ---------- ---------- ----------
Total Distributions ................. (0.27) (0.35) (0.45) (0.25) --
---------- ---------- ---------- ---------- ----------
Net Asset Value, End of Period ........ $ 5.65 $ 5.69 $ 5.59 $ 5.56 $ 5.26
========== ========== ========== ========== ==========
Total Return(4) ..................... 4.05% 8.32% 9.06% 10.77% 3.34%
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to
Average Net Assets .................. 1.25%(5) 1.25% 1.25% 1.25% 1.25%(5)
Ratio of Net Investment Income to
Average Net Assets .................. 2.94%(5) 2.76% 3.10% 3.23% 3.25%(5)
Portfolio Turnover Rate ............... 64% 105% 113% 124% 44%
Net Assets, End of Period
(in thousands) ...................... $ 11,119 $ 8,876 $ 6,596 $ 4,253 $ 3,973
</TABLE>
(1) Six months ended May 31, 2000 (unaudited).
(2) October 2, 1996 (commencement of sale) through November 30, 1996.
(3) Computed using average shares outstanding throughout the period.
(4) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one
year are not annualized.
(5) Annualized.
See Notes to Financial Statements www.americancentury.com 57
Strategic Moderate--Financial Highlights
--------------------------------------------------------------------------------
This table itemizes investment results and distributions on a per-share basis to
illustrate share price changes for each of the last five fiscal years (or less,
if the share class is not five years old). It also includes several key
statistics for each reporting period, including TOTAL RETURN, INCOME RATIO (net
investment income as a percentage of average net assets), EXPENSE RATIO
(operating expenses as a percentage of average net assets), and PORTFOLIO
TURNOVER (a gauge of the fund's trading activity).
<TABLE>
FOR A SHARE OUTSTANDING THROUGHOUT THE YEARS ENDED NOVEMBER 30 (EXCEPT AS NOTED)
Investor Class
2000(1) 1999 1998 1997 1996(2)
PER-SHARE DATA
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ...... $6.89 $6.22 $5.98 $5.42 $5.00
--------- -------- -------- --------- --------
Income From Investment Operations
Net Investment Income(3) ................ 0.08 0.12 0.15 0.14 0.10
Net Realized and Unrealized Gain
on Investment Transactions .............. 0.46 0.88 0.45 0.56 0.39
--------- -------- -------- --------- --------
Total From Investment Operations ........ 0.54 1.00 0.60 0.70 0.49
--------- -------- -------- --------- --------
Distributions
From Net Investment Income .............. (0.07) (0.12) (0.16) (0.13) (0.07)
From Net Realized Gains on
Investment Transactions ................. (0.18) (0.21) (0.20) (0.01) --
--------- -------- -------- --------- --------
Total Distributions ..................... (0.25) (0.33) (0.36) (0.14) (0.07)
--------- -------- -------- --------- --------
Net Asset Value, End of Period ............ $7.18 $6.89 $6.22 $5.98 $5.42
========= ======== ======== ========= ========
Total Return(4) ......................... 7.71% 16.97% 10.32% 13.02% 9.91%
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to
Average Net Assets ......................1.10%(5) 1.10% 1.10% 1.10% 1.10%(5)
Ratio of Net Investment Income to
Average Net Assets ......................2.07%(5) 1.92% 2.38% 2.43% 2.52%(5)
Portfolio Turnover Rate ................... 77% 107% 127% 119% 78%
Net Assets, End of Period
(in thousands) ..........................$430,925 $375,592 $261,721 $201,384 $57,836
</TABLE>
(1) Six months ended May 31, 2000 (unaudited).
(2) February 15, 1996 (inception) through November 30, 1996.
(3) Computed using average shares outstanding throughout the period.
(4) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(5) Annualized.
58 1-800-345-2021 See Notes to Financial Statements
Strategic Moderate--Financial Highlights
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR A SHARE OUTSTANDING THROUGHOUT THE YEARS ENDED NOVEMBER 30 (EXCEPT AS NOTED)
Advisor Class
2000(1) 1999 1998 1997 1996(2)
PER-SHARE DATA
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ..... $6.89 $6.22 $5.98 $5.42 $5.24
-------- --------- -------- -------- --------
Income From Investment Operations
Net Investment Income(3) ............... 0.07 0.11 0.13 0.12 0.02
Net Realized and Unrealized Gain
on Investment Transactions ............. 0.45 0.88 0.45 0.56 0.16
-------- --------- -------- -------- --------
Total From Investment Operations ....... 0.52 0.99 0.58 0.68 0.18
-------- --------- -------- -------- --------
Distributions
From Net Investment Income ............. (0.06) (0.11) (0.14) (0.11) --
From Net Realized Gains
on Investment Transactions ............. (0.18) (0.21) (0.20) (0.01) --
-------- --------- -------- -------- --------
Total Distributions .................... (0.24) (0.32) (0.34) (0.12) --
-------- --------- -------- -------- --------
Net Asset Value, End of Period ........... $7.17 $6.89 $6.22 $5.98 $5.42
======== ========= ======== ======== ========
Total Return(4) ........................ 7.58% 16.66% 10.07% 12.72% 3.44%
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to
Average Net Assets ..................... 1.35%(5) 1.35% 1.35% 1.35% 1.35%(5)
Ratio of Net Investment Income to
Average Net Assets ..................... 1.82%(5) 1.67% 2.13% 2.18% 2.10%(5)
Portfolio Turnover Rate .................. 77% 107% 127% 119% 78%
Net Assets, End of Period
(in thousands) ......................... $18,529 $15,979 $13,251 $8,573 $7,566
</TABLE>
(1) Six months ended May 31, 2000 (unaudited).
(2) October 2, 1996 (commencement of sale) through November 30, 1996.
(3) Computed using average shares outstanding throughout the period.
(4) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one
year are not annualized.
(5) Annualized.
See Notes to Financial Statements www.americancentury.com 59
Strategic Aggressive--Financial Highlights
--------------------------------------------------------------------------------
This table itemizes investment results and distributions on a per-share basis to
illustrate share price changes for each of the last five fiscal years (or less,
if the share class is not five years old). It also includes several key
statistics for each reporting period, including TOTAL RETURN, INCOME RATIO (net
investment income as a percentage of average net assets), EXPENSE RATIO
(operating expenses as a percentage of average net assets), and PORTFOLIO
TURNOVER (a gauge of the fund's trading activity).
<TABLE>
<CAPTION>
FOR A SHARE OUTSTANDING THROUGHOUT THE YEARS ENDED NOVEMBER 30 (EXCEPT AS NOTED)
Investor Class
2000(1) 1999 1998 1997 1996(2)
PER-SHARE DATA
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ..... $7.91 $6.54 $6.25 $5.53 $5.00
-------- --------- -------- -------- --------
Income From Investment Operations
Net Investment Income(3) ............... 0.04 0.07 0.10 0.09 0.07
Net Realized and Unrealized Gain
on Investment Transactions ............. 0.80 1.55 0.49 0.67 0.46
-------- --------- -------- -------- --------
Total From Investment Operations ....... 0.84 1.62 0.59 0.76 0.53
-------- --------- -------- -------- --------
Distributions
From Net Investment Income ............. (0.08) (0.08) (0.09) (0.04) --
From Net Realized Gains
on Investment Transactions ............. (0.35) (0.17) (0.21) -- --
-------- --------- -------- -------- --------
Total Distributions .................... (0.43) (0.25) (0.30) (0.04) --
-------- --------- -------- -------- --------
Net Asset Value, End of Period ........... $8.32 $7.91 $6.54 $6.25 $5.53
======== ========= ======== ======== ========
Total Return(4) ........................ 10.87% 25.69% 9.93% 13.84% 10.60%
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to
Average Net Assets ..................... 1.20%(5) 1.20% 1.20% 1.20% 1.20%(5)
Ratio of Net Investment Income to
Average Net Assets ..................... 0.95%(5) 1.02% 1.49% 1.58% 1.72%(5)
Portfolio Turnover Rate .................. 70% 115% 134% 135% 64%
Net Assets, End of Period
(in thousands) ......................... $263,077 $192,831 $145,125 $109,497 $46,276
</TABLE>
(1) Six months ended May 31, 2000 (unaudited).
(2) February 15, 1996 (inception) through November 30, 1996.
(3) Computed using average shares outstanding throughout the period.
(4) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(5) Annualized.
60 1-800-345-2021 See Notes to Financial Statements
Strategic Aggressive--Financial Highlights
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FOR A SHARE OUTSTANDING THROUGHOUT THE YEARS ENDED NOVEMBER 30 (EXCEPT AS NOTED)
Advisor Class
2000(1) 1999 1998 1997 1996(2)
PER-SHARE DATA
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ...... $7.89 $6.52 $6.23 $5.53 $5.37
-------- --------- -------- -------- --------
Income From Investment Operations
Net Investment Income(3) ................ 0.03 0.05 0.08 0.07 0.01
Net Realized and Unrealized Gain
on Investment Transactions .............. 0.80 1.55 0.49 0.67 0.15
-------- --------- -------- -------- --------
Total From Investment Operations ........ 0.83 1.60 0.57 0.74 0.16
-------- --------- -------- -------- --------
Distributions
From Net Investment Income .............. (0.06) (0.06) (0.07) (0.04) --
From Net Realized Gains
on Investment Transactions .............. (0.35) (0.17) (0.21) -- --
-------- --------- -------- -------- --------
Total Distributions ..................... (0.41) (0.23) (0.28) (0.04) --
-------- --------- -------- -------- --------
Net Asset Value, End of Period ............ $8.31 $7.89 $6.52 $6.23 $5.53
======== ========= ======== ======== ========
Total Return(4) ......................... 10.78% 25.46% 9.66% 13.43% 2.98%
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to
Average Net Assets .....................1.45%(5) 1.45% 1.45% 1.45% 1.45%(5)
Ratio of Net Investment Income to
Average Net Assets ......................0.70%(5) 0.77% 1.24% 1.33% 1.31%(5)
Portfolio Turnover Rate ................... 70% 115% 134% 135% 64%
Net Assets, End of Period
(in thousands) ..........................$19,973 $13,417 $10,228 $8,095 $5,872
</TABLE>
(1) Six months ended May 31, 2000 (unaudited).
(2) October 2, 1996 (commencement of sale) through November 30, 1996.
(3) Computed using average shares outstanding throughout the period.
(4) Total return assumes reinvestment of dividends and capital gains
distributions, if any. Total returns for periods less than one
year are not annualized.
(5) Annualized.
See Notes to Financial Statements www.americancentury.com 61
Share Class and Retirement Account Information
--------------------------------------------------------------------------------
SHARE CLASSES
Three classes of shares are authorized for sale by the funds: Investor
Class, Advisor Class and Institutional Class.
INVESTOR CLASS shareholders do not pay any commissions or other fees for
purchase of fund shares directly from American Century. Investors who buy
Investor Class shares through a broker-dealer may be required to pay the
broker-dealer a transaction fee.
ADVISOR CLASS shares are sold through banks, broker-dealers, insurance
companies and financial advisors. Advisor Class shares are subject to a 0.50%
Rule 12b-1 service and distribution fee. Half of that fee is available to pay
for recordkeeping and administrative services, and half is available to pay for
distribution services provided by the financial intermediary through which the
Advisor Class shares are purchased. The total expense ratio of the Advisor Class
shares is 0.25% higher than the total expense ratio of the Investor Class
shares.
INSTITUTIONAL CLASS shares are available to endowments, foundations,
defined benefit pension plans or financial intermediaries serving these
investors. This class recognizes the relatively lower cost of serving
institutional customers and others who invest at least $5 million in an American
Century fund or at least $10 million in multiple funds. In recognition of the
larger investments and account balances and comparatively lower transaction
costs, the total expense ratio of the Institutional Class shares is 0.20% less
than the total expense ratio of the Investor Class shares. The Institutional
Class had not commenced as of May 31, 2000, for Strategic: Conservative,
Moderate, or Aggressive.
All classes of shares represent a pro rata interest in the funds and
generally have the same rights and preferences.
RETIREMENT ACCOUNT INFORMATION
As required by law, any distributions you receive from an IRA and certain
403(b) distributions [not eligible for rollover to an IRA or to another 403(b)
account] are subject to federal income tax withholding at the rate of 10% of the
total amount withdrawn, unless you elect not to have withholding apply. If you
don't want us to withhold on this amount, you may send us a written notice not
to have the federal income tax withheld. Your written notice is valid from the
date of receipt at American Century. Even if you plan to roll over the amount
you withdraw to another tax-deferred account, the withholding rate still applies
to the withdrawn amount unless we have received a written notice not to withhold
federal income tax prior to the withdrawal.
When you plan to withdraw, you may make your election by completing our
Exchange/Redemption form or an IRS Form W-4P. Call American Century for either
form. Your written election is valid from the date of receipt at American
Century. You may revoke your election at any time by sending a written notice
to us.
Remember, even if you elect not to have income tax withheld, you are liable
for paying income tax on the taxable portion of your withdrawal. If you elect
not to have income tax withheld or you don't have enough income tax withheld,
you may be responsible for payment of estimated tax. You may incur penalties
under the estimated tax rules if your withholding and estimated tax payments are
not sufficient.
62 1-800-345-2021
Background Information
--------------------------------------------------------------------------------
INVESTMENT PHILOSOPHY AND POLICIES
American Century offers 14 growth and income funds, including domestic
equity, balanced, asset allocation, and specialty funds.
STRATEGIC ALLOCATION: CONSERVATIVE emphasizes bonds and money market
securities to provide regular income and principal protection. The fund also
provides the potential for moderate long-term growth by investing a portion of
its assets in stocks.
STRATEGIC ALLOCATION: MODERATE emphasizes common stocks for their long-term
growth prospects, but it maintains a sizable stake in bonds and money market
securities to provide some income and increase overall price stability.
STRATEGIC ALLOCATION: AGGRESSIVE focuses primarily on common stocks as a
source of long-term growth, but it maintains a small portion of its assets in
bonds and money market securities to provide a modest amount of income and help
cushion the share price volatility of the stock portion.
The risk designations are relative only to the three Strategic Asset
Allocation funds and do not represent comparisons with any other investment.
The funds invest in both domestic and foreign securities. International
investing involves special risks, such as political instability and currency
fluctuations.
COMPARATIVE INDICES
The following indices are used in the report for fund performance
comparisons. They are not investment products available for purchase.
The S&P 500 is composed of 500 large-capitalization stocks traded on
domestic exchanges. It is considered a broad measure of large-company stock
performance.
The S&P MIDCAP 400 is composed of 400 mid-capitalization stocks traded on
domestic exchanges. It is considered a broad measure of mid-sized stock
performance.
The S&P SMALLCAP 600 is composed of 600 small-capitalization stocks traded
on domestic exchanges. It is considered a broad measure of small-company stock
performance.
The LEHMAN AGGREGATE BOND INDEX reflects the combined performance of
several Lehman bond indices, including the TREASURY BOND, CORPORATE BOND, and
MORTGAGE-BACKED SECURITIES indices.
The MORGAN STANLEY EUROPE, AUSTRALASIA, FAR EAST (EAFE(reg.tm)) INDEX is a
widely followed group of stocks from 22 countries (excluding the U.S.).
The THREE-MONTH U.S. TREASURY BILL INDEX is derived from secondary market
interest rates as published by the Federal Reserve Bank.
[right margin]
INVESTMENT TEAM LEADERS
Portfolio Managers
JEFF TYLER
BRIAN HOWELL
THE FUNDS' NEUTRAL
ASSET MIXES*
CON MOD AGG
STOCKS 40% 60% 75%
BONDS 45% 30% 20%
CASH
(MONEY MARKET
SECURITIES) 15% 10% 5%
* The funds' actual asset mixes will vary from the neutral mixes based on
investment performance. Fund managers regularly review the portfolios and
rebalance the asset mixes to stay within the funds' preset operating ranges.
www.americancentury.com 63
Glossary
--------------------------------------------------------------------------------
RETURNS
* TOTAL RETURN figures show the overall percentage change in the value of a
hypothetical investment in the fund and assume that all of the fund's
distributions are reinvested.
* AVERAGE ANNUAL RETURNS illustrate the annually compounded returns that would
have produced the fund's cumulative total returns if the fund's performance had
been constant over the entire period. Average annual returns smooth out
variations in a fund's return; they are not the same as fiscal year-by-year
results. For fiscal year-by-year total returns, please refer to the "Financial
Highlights" on pages 56-61.
STOCK PORTFOLIO STATISTICS
* NUMBER OF COMPANIES -- the number of different companies held by a fund on a
given date.
* DIVIDEND YIELD -- a percentage return calculated by dividing a company's
annual cash dividend by the current market value of the company's stock.
* PRICE/EARNINGS RATIO -- a stock value measurement calculated by dividing a
company's stock price by its earnings per share, with the result expressed as a
multiple instead of a percentage. (Earnings per share is calculated by dividing
a company's after-tax earnings by its outstanding shares.)
BOND PORTFOLIO STATISTICS
* NUMBER OF SECURITIES -- the number of different securities held by a fund on
a given date.
* WEIGHTED AVERAGE MATURITY (WAM) -- a measure of the sensitivity of a
fixed-income portfolio to interest rate changes. WAM indicates the average time
until the securities in the portfolio mature, weighted by dollar amount. The
longer the WAM, the more interest rate exposure and sensitivity the portfolio
has.
* AVERAGE DURATION -- another measure of the sensitivity of a fixed-income
portfolio to interest rate changes. Duration is a time-weighted average of the
interest and principal payments of the securities in a portfolio. As the
duration of a portfolio increases, so does the impact of a change in interest
rates on the value of the portfolio.
FIXED-INCOME SECURITY TYPES
* ASSET-BACKED SECURITIES -- debt securities that represent ownership in a
pool of receivables, such as credit card debt, auto loans, or mortgages.
* CORPORATE SECURITIES -- debt securities or instruments issued by
corporations. Short-term corporate securities are typically issued to raise cash
and cover current expenses in anticipation of future revenues; long-term
corporate securities are issued to finance capital expenditures, such as new
plant construction or equipment purchases.
* MORTGAGE-BACKED SECURITIES -- debt securities that represent ownership in
pools of mortgage loans. Most mortgage-backed securities are structured as
"pass-throughs"--the monthly payments of principal and interest on the mortgages
in the pool are collected by the bank that is servicing the mortgages and are
"passed through" to investors. While the payments of principal and interest are
considered secure (many are backed by government agency guarantees), the cash
flow is less certain than in other fixed-income investments. Mortgages that are
paid off early reduce future interest payments from the pool.
* U.S. GOVERNMENT AGENCY SECURITIES --debt securities issued by U.S.
government agencies (such as the Federal Home Loan Bank and the Federal Farm
Credit Bank). Some agency securities are backed by the full faith and credit of
the U.S. government, while others are guaranteed only by the issuing agency.
Government agency securities include discount notes (maturing in one year or
less) and medium-term notes, debentures, and bonds (maturing in three months to
50 years).
* U.S. TREASURY SECURITIES -- debt securities issued by the U.S. Treasury and
backed by the direct "full faith and credit" pledge of the U.S. government.
Treasury securities include bills (maturing in one year or less), notes
(maturing in two to ten years), and bonds (maturing in more than ten years).
64 1-800-345-2021
Glossary
--------------------------------------------------------------------------------
(Continued)
FUND CLASSIFICATIONS
Please be aware that the fund's category may change over time. Therefore, it
is important that you read a fund's prospectus or fund profile carefully before
investing to ensure its objectives, policies, and risk potential are consistent
with your needs.
INVESTMENT OBJECTIVE
The investment objective may be based on the fund's objective as stated in
its prospectus or fund profile, or the fund's categorization by independent
rating organizations based on its management style.
* CAPITAL PRESERVATION -- offers taxable and tax-free money market funds for
relative stability of principal and liquidity.
* INCOME -- offers funds that can provide current income and competitive
yields, as well as a strong and stable foundation and generally lower volatility
levels than stock funds.
* GROWTH & INCOME -- offers funds that emphasize both growth and income
provided by either dividend-paying equities or a combination of equity and
fixed-income securities.
* GROWTH -- offers funds with a focus on capital appreciation and long-term
growth, generally providing high return potential with corresponding high
price-fluctuation risk.
RISK
The classification of funds by risk category is based on quantitative
historical measures as well as qualitative prospective measures. It is not
intended to be a precise indicator of future risk or return levels. The degree
of risk within each category can vary significantly, and some fund returns have
historically been higher than more aggressive funds or lower than more
conservative funds.
* CONSERVATIVE -- these funds generally provide lower return potential with
either low or minimal price-fluctuation risk.
* MODERATE -- these funds generally provide moderate return potential with
moderate price-fluctuation risk.
* AGGRESSIVE -- these funds generally provide
high return potential with corresponding high price-fluctuation risk.
www.americancentury.com 65
Notes
--------------------------------------------------------------------------------
66 1-800-345-2021
Notes
--------------------------------------------------------------------------------
www.americancentury.com 67
Notes
--------------------------------------------------------------------------------
68 1-800-345-2021
[inside back cover]
===============================================================================
INVESTMENT OBJECTIVE - CAPITAL PRESERVATION
===============================================================================
RISK LEVEL - CONSERVATIVE
TAXABLE MONEY MARKETS TAX-FREE MONEY MARKETS
Premium Capital Reserve FL Municipal Money Market
Prime Money Market CA Municipal Money Market
Premium Government Reserve CA Tax-Free Money Market
Government Agency Tax-Free Money Market
Money Market
Capital Preservation
===============================================================================
INVESTMENT OBJECTIVE - INCOME
===============================================================================
RISK LEVEL - AGGRESSIVE
TAXABLE BONDS TAX-FREE BONDS
Target 2025* CA High-Yield Municipal
Target 2020* High-Yield Municipal
Target 2015*
Target 2010*
High-Yield
International Bond
RISK LEVEL - MODERATE
TAXABLE BONDS TAX-FREE BONDS
Long-Term Treasury CA Long-Term Tax-Free
Target 2005* Long-Term Tax-Free
Bond CA Insured Tax-Free
Premium Bond
RISK LEVEL - CONSERVATIVE
TAXABLE BONDS TAX-FREE BONDS
Intermediate-Term Bond CA Intermediate-Term Tax-Free
Intermediate-Term Treasury AZ Intermediate-Term Municipal
GNMA FL Intermediate-Term Municipal
Inflation-Adjusted Treasury Intermediate-Term Tax-Free
Limited-Term Bond CA Limited-Term Tax-Free
Target 2000* Limited-Term Tax-Free
Short-Term Government
Short-Term Treasury
===============================================================================
INVESTMENT OBJECTIVE - GROWTH AND INCOME
===============================================================================
RISK LEVEL - AGGRESSIVE
DOMESTIC EQUITY
Small Cap Quantitative
Small Cap Value
RISK LEVEL - MODERATE
ASSET ALLOCATION/BALANCED DOMESTIC EQUITY SPECIALTY
Strategic Allocation: Equity Growth Utilities
Aggressive Equity Index Real Estate
Balanced Large Cap Value
Strategic Allocation: Tax-Managed Value
Moderate Income & Growth
Strategic Allocation: Value
Conservative Equity Income
===============================================================================
INVESTMENT OBJECTIVE - GROWTH
===============================================================================
RISK LEVEL - AGGRESSIVE
DOMESTIC EQUITY SPECIALTY INTERNATIONAL
Veedot(reg.sm) Global Gold Emerging Markets
New Opportunities International Discovery
Giftrust(reg.tm) International Growth
Vista Global Growth
Heritage
Growth
Ultra(reg.tm)
Select
RISK LEVEL - MODERATE
SPECIALTY
Global Natural Resources
The investment objective may be based on the fund's objective as stated in its
prospectus or fund profile, or the fund's categorization by independent rating
organizations based on its management style.
The classification of funds by risk category is based on quantitative
historical measures as well as qualitative prospective measures. It is not
intended to be a precise indicator of future risk or return levels. The degree
of risk within each category can vary significantly, and some fund returns have
historically been higher than more aggressive funds or lower than more
conservative funds. Please be aware that a fund's category may change over time.
Therefore, it is important that you read a fund's prospectus or fund profile
carefully before investing to ensure its objectives, policies and risk potential
are consistent with your needs. For a definition of fund categories, see the
Glossary.
* While listed within the Income investment objective, the Target funds do not
pay current dividend income. Income dividends are distributed once a year in
December. The Target funds are listed in all three risk categories due to the
dramatic price volatility investors may experience during certain market
conditions. If held to their target dates, however, they can offer a
conservative, dependable way to invest for a specific time horizon.
Please call 1-800-345-2021 for a prospectus or profile on any American Century
fund. These documents contain important information including charges and
expenses, and you should read them carefully before you invest or send money.
[back cover]
Who we are
American Century offers investors more than 70 mutual funds that span the
investment spectrum. We currently manage $100 billion for roughly 2 million
individuals, institutions and corporations, with a range of services designed to
make investing easy and convenient.
For four decades, American Century has been a leader in performance, service
and innovation. From pioneering the use of computer technology in investing to
allowing investors to conduct transactions and receive financial advice over the
Internet, we have remained committed to building long-term relationships and to
helping investors achieve their dreams.
In a very real sense, investors put their future in our hands. With so much at
stake, our work continues to be guided by one central belief, shared by every
person at American Century: WE SUCCEED ONLY IF OUR INVESTORS SUCCEED.
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[american century logo(reg.sm)]
American
Century
P.O. BOX 419200
KANSAS CITY, MISSOURI 64141-6200
WWW.AMERICANCENTURY.COM
INVESTOR RELATIONS
1-800-345-2021 OR 816-531-5575
AUTOMATED INFORMATION LINE
1-800-345-8765
FAX: 816-340-7962
TELECOMMUNICATIONS DEVICE FOR THE DEAF
1-800-634-4113 OR 816-444-3485
BUSINESS, NOT-FOR-PROFIT, EMPLOYER-SPONSORED
RETIREMENT PLANS
1-800-345-3533
BANKS AND TRUST COMPANIES, BROKER-DEALERS,
FINANCIAL ADVISORS, INSURANCE COMPANIES
1-800-345-6488
AMERICAN CENTURY STRATEGIC ASSET ALLOCATIONS, INC.
INVESTMENT MANAGER
AMERICAN CENTURY INVESTMENT MANAGEMENT, INC.
KANSAS CITY, MISSOURI
THIS REPORT AND THE STATEMENTS IT CONTAINS ARE SUBMITTED FOR THE GENERAL
INFORMATION OF OUR SHAREHOLDERS. THE REPORT IS NOT AUTHORIZED FOR DISTRIBUTION
TO PROSPECTIVE INVESTORS UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE
PROSPECTUS.
American Century Investments PRSRT STD
P.O. Box 419200 U.S. POSTAGE PAID
Kansas City, MO 64141-6200 AMERICAN CENTURY
www.americancentury.com COMPANIES
0007 American Century Investment Services, Inc.
SH-SAN-21201 (c)2000 American Century Services Corporation
