VISTA
- ---------------------------
CAPITAL ADVANTAGE
- ---------------------------
MANAGED BY CHASE MANHATTAN
- ---------------------------
April 1996
Dear Vista Capital Advantage Contract Owner:
Enclosed is the February 29, 1996 Semi-Annual Report of the Mutual Fund
Variable Annuity Trust, whose portfolios serve as the underlying investments
for the Vista Capital Advantage variable annuity.
The table below shows the six-month, twelve-month and since inception results
of the accounts in the Vista Capital Advantage variable annuity at fiscal
year-end and quarter-end. The trailing six-month figures shown below are
slightly different from those appearing in the enclosed report because they
reflect the deduction of insurance fees associated with your contract. These
fees include mortality and expense risk charges, which pay for benefits such
as your contract's Family Protection feature.
<TABLE>
<CAPTION>
Average Annual Total Return(1)
- ------------------------------------- --------------------------------------------------------------------
At Fiscal Year-end (2/29/96) At Quarter-end (3/31/96)
Trailing 6 Since Trailing 12 Since
Portfolio (Inception Date) months(2) Inception months Inception
- ------------------------------------- --------------- ------------ --------------- --------------
<S> <C> <C> <C> <C>
Growth and Income (3/13/95) 10.44% 26.22% 24.91% 27.05%
Capital Growth (3/13/95) 9.10% 28.94% 30.23% 32.78%
International Equity (3/13/95) 1.53% 11.12% 10.39% 13.19%
Asset Allocation (3/13/95) 7.39% 17.54% 16.65% 17.50%
U.S. Treasury Income (7/13/95) 2.42% 1.92% N/A 0.76%
Money Market (6/2/95)(3) 1.91% 2.90% N/A 3.20%
7-day curent yield as of 3/31/96: 3.42%
</TABLE>
On the reverse side of this letter, you will find an additional table which,
in accordance with Securities and Exchange Commissions regulations, shows
results of the most recently completed calendar quarter after the deduction
of all charges, including withdrawal charges(4) and the annual contract
administration charge. Withdrawal Charges, where applicable, apply only to
withdrawals in excess of 10% during the first seven years after each
investment. Of course, you may withdraw 100% of earnings at any time, free of
surrender charge.(5)
Your Vista Capital Advantage variable annuity represents a unique combination
of professional money management and tax advantages. It is designed to
contribute to your plans for a financially secure future.
If you have any questions, please call your investment representative or
1-800-90-VISTA.
Sincerely,
/s/ Fergus Reid
Fergus Reid
Chairman
<PAGE>
Average Annual Total Return
(If You Surrendered Your Policy)
<TABLE>
<CAPTION>
At Quarter-end (3/31/96)
Portfolio (Inception Date) Trailing 12 months Since Inception
- ----------------------------------------- ------------------- ------------------
<S> <C> <C>
Growth and Income (3/13/95) 18.91% 22.35%
Capital Growth (3/13/95) 24.23% 28.09%
International Equity (3/13/95) 4.39% 8.46%
Asset Allocation (3/13/95) 10.65% 12.78%
U.S. Treasury Income (7/13/95) N/A -5.24%
Money Market (6/2/95) N/A N/A
7-day curent yield as of 3/31/96: 3.42%
</TABLE>
(1) These figures reflect the average change in unit value for the period and
do not include the deduction of Withdrawal Charges.
(2) These figures reflect the change in unit value for the past 6 months, and
do not include the deduction of the annual contract charge or Withdrawal
Charges.
(3) There can be no assurance that the underlying fund will be able to
maintain a stable net asset value of $1.00 per share and fund shares
themselves are not insured or guaranteed by the U.S. Government.
(4) The Withdrawal Charge schedule in states other than NY is as follows: 6%,
6%, 5%, 5%, 4%, 3% 2%, 0%.
(5) A 10% Federal tax penalty may apply to withdrawals before age 59-1/2.
Performance data quoted in this letter represents past performance and is no
guarantee of future results. An investor's return and principal value will
fluctuate. An investor's units, when redeemed, may be worth more or less than
their original investment. This material is authorized for public
distribution only when accompanied or preceded by a prospectus for Vista
Capital Advantage.
The distributor of Vista Capital Advantage (VCA) is Vista Fund Distributors,
Inc., which is unaffiliated with the Chase Manhattan Bank, Anchor National
Life Insurance Company or First SunAmerica Life Insurance Company. Chase
Manhattan is the portfolio advisor, administrator and custodian of the
underlying investment options. VCA is issued by Anchor National Life
Insurance Company or First SunAmerica Life Insurance Company (in New York).
-----------------------------------------------------------------------------
Investments in Vista Capital Advantage are not deposits, or guaranteed or
endorsed by, Chase, and are not insured by the FDIC, Federal Reserve Board or
any other government agency. Investments in Vista Capital Advantage,
including the underlying variable investment options, involve risk, including
possible loss of principal.
-----------------------------------------------------------------------------
<PAGE>
[logo]
S E M I-A N N U A L R E P O R T
F E B R U A R Y 2 9, 1 9 9 6
VISTA
-----------------
CAPITAL ADVANTAGE
-----------------
MANAGED BY CHASE MANHATTAN
Mutual Fund Variable Annuity Trust
Distributed by Vista Fund Distributors, Inc.
This report must be accompanied or preceded by a current prospectus for Vista
Capital Advantage
<PAGE>
page 2
[logo] TABLE OF CONTENTS
Letter from the Chairman..................3
Performance & Commentary
Growth and Income .......................4
Capital Growth...........................4
International Equity ....................5
Asset Allocation ........................5
U.S. Treasury Income ....................6
Money Market ............................6
Portfolio of Investments
Growth and Income .......................7
Capital Growth...........................8
International Equity..................9-10
Asset Allocation .......................11
U.S. Treasury Income ...................12
Money Market............................13
Mutual Fund Variable Annuity Trust
Statement of Assets & Liabilities ......14
Statement of Operations ................15
Statement of Changes in Net Assets ..16-17
Selected Per Share Data and Ratios ..18-19
Notes to Financial Statements ........20-22
The financial information in this report has been taken from the
books and records of the portfolios without examination by
independent accountants who express no opinion thereto.
INVESTMENTS IN VISTA CAPITAL ADVANTAGE ARE NOT INSURED BY THE FDIC, FEDERAL
RESERVE BOARD OR ANY OTHER GOVERNMENT AGENCY AND ARE NOT DEPOSITS OF,
ENDORSED BY, OR GUARANTEED BY, CHASE. INVESTMENTS IN VISTA CAPITAL ADVANTAGE,
INCLUDING THE UNDERLYING VARIABLE INVESTMENT OPTIONS, ARE SUBJECT TO RISK,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
<PAGE>
page 3
LETTER FROM THE CHAIRMAN [logo]
DEAR INVESTOR:
We are pleased to present this Semi-Annual Report on the six variable
annuity portfolios in the Mutual Fund Variable Annuity Trust that
underly your Vista Capital Advantage variable annuity for the six-month
period ended February 29, 1996.
As you'll see in this report, most financial markets benefited from a
generally positive economic climate for investing over the past six
months. To help you monitor your portfolios' performance, we've
included commentary summarizing the major events in the financial
markets that affected your investment in addition to their total return
performance for the period under review.
U.S. STOCK AND BOND MARKETS CONTINUE TO CLIMB
Most U.S. financial markets flourished in a positive economic climate
for investing. Stock prices remained strong, sparked by investors who
flocked to purchase equities on optimism about a prolonged bull market.
What's more, investors believed economic growth would remain solid and
inflation would continue to be moderate.
Bond market investors also benefited during the period under review as
bond prices pushed higher and yields continued to move lower. But, late
in the period under review, bond yields reversed course, moving higher
on volatility in the wake of stronger-than-anticipated economic growth.
ECONOMIC CLIMATE BENEFITS INTERNATIONAL MARKETS
During the period under review, the European stock markets generally
benefited as most economies continued to show tepid growth with
moderate inflation. The Japanese market also rallied in reaction to the
government's pursuit of a looser monetary policy and a weaker yen.
Meanwhile, markets in Southeast Asia and Latin America rebounded from
somewhat depressed levels, benefiting from lower interest rates and
increased global liquidity.
As always, we appreciate the confidence you have placed in Vista and
look forward to helping you achieve your financial goals in the years
ahead. If you have any questions about your portfolio--or its recent
performance--please do not hesitate to call your investment
representative or 1-800-90-VISTA.
Sincerely,
/s/ Fergus Reid
Fergus Reid
Chairman
<PAGE>
page 4
[logo] PERFORMANCE & COMMENTARY
GROWTH & INCOME PORTFOLIO
objective:
seeks long-term capital
appreciation and dividend
income through diversified
holdings of common stocks.
pursues a "contrary opinion"
approach, selecting common
stocks that are currently out
of favor with investors.
GROWTH AND INCOME PORTFOLIO
The U.S. equity market, as represented by the Dow Jones Industrial Average
and S&P 500, continued to register new highs during the period under review,
boosting the performance of the Growth and Income Portfolio. Contributing to
the Portfolio's returns was the management team's emphasis on stocks in the
capital goods, financial and consumer sectors, which generally performed
well. Your Portfolio achieved an 11.22%* total return for the six months
ended February 29, 1996.
From August 31, 1995, through February 29, 1996, the U.S. equity market
continued to push higher, building on the momentum begun earlier in 1995.
Stock prices remained strong, sparked by investors who flocked to purchase
equities on optimism about a prolonged bull market.
This optimism was based primarily on the view that the economic environment
would continue to benefit from the stock market's performance. For instance,
investors believed that economic growth would remain solid and inflation
would continue to be moderate. Stocks were also expected to benefit from
solid corporate earnings growth based on stable consumer demand and better
inventory and pricing. Other factors expected to contribute to improved
corporate earnings were the following: the results of prior restructuring
efforts, cost management and a profusion of merger and acquisition activity.
Going forward, we continue to see volatility in the U.S. equity market in
1996. Within this environment, portfolio management will continue to look for
opportunities to buy stocks that are attractively priced but take profits in
issues that have already performed strongly.
CAPITAL GROWTH PORTFOLIO
The Capital Growth Portfolio performed strongly during the six-month period
ended February 29, 1996, as the U.S. stock market continued to rally. From
August 31, 1995, through February 29, 1996, the Portfolio achieved a 9.89%*
total return.
Your Portfolio benefited from the management team's decision to participate
in such diverse sectors as energy, financial, health care and utilities.
Other pockets of opportunity were found in the small- and mid-capitalization
areas. For example, following the broad-based sell-off in technology stocks,
the Portfolio management team was able to buy shares of the best technology
companies at relatively depressed prices.
The U.S. equity market continued its positive performance during the period
under review. Stock prices remained strong as enthusiastic investors
continued to enter the market in droves. For the most part, investors
expected the economy to continue to grow while inflation remained under
control. Stocks were also expected to benefit from solid corporate earnings
growth based on the following: stable consumer demand; better inventory and
pricing; the results of prior restructuring efforts; and merger and
acquisition activity.
Looking ahead, within an overall volatile environment for U.S. equities, we
see strong long-term prospects for growth in both small- and medium-sized
companies.
CAPITAL GROWTH PORTFOLIO
objective:
seeks long-term capital growth
primarily through diversified
holdings in common stocks.
*Total return figures do not include the effect of any insurance or
withdrawal charges.
<PAGE>
page 5
PERFORMANCE & COMMENTARY [logo]
INTERNATIONAL EQUITY
PORTFOLIO
objective:
seeks long-term growth
of capital and income by
investing in equity securities
of established foreign companies
and foreign subsidiaries of
U.S. companies participating
in foreign economies with
prospects for growth.
international investing is subject to
special risks, including currency
fluctuations and differences in
accounting and taxation standards
and political instability.
INTERNATIONAL EQUITY PORTFOLIO
The International Equity Portfolio had a total return of 2.22%* for the six
months ended February 29, 1996, in an overall positive, yet sometimes
volatile, period for the overseas equity markets. November and December 1995
were especially difficult for the Portfolio, which did not fully participate
in the substantial year-end rally in Japan.
During the period under review, the European stock markets generally
benefited as economies continued to show below-trend growth with moderate
inflation. European equities registered gains in most markets, buoyed by
lower interest rates and higher corporate earnings. An uncertain political
climate in some European markets remains an unsettling factor; however, in a
global context, these markets offer value and we remain positive about the
region.
In Japan, the stock market continued to rebound from June 1995 lows as the
government aggressively pursued a looser monetary policy and actively
intervened in the foreign exchange markets to weaken the yen. Japan also
benefited from the increase in consumer demand, the expansion of corporate
profit margins in the better pricing environment and the progress made to
address the country's debt situation.
During the last six months, the developing markets of Southeast Asia and
Latin America rebounded from somewhat depressed levels, benefiting from lower
interest rates and increased global liquidity. The economies of Mexico and
Argentina began to show signs of improvement, which should help the regional
economies in Latin America. Meanwhile, the Southeast Asian economies
continued to remain stable.
Looking ahead, we are comfortable with our positions in the international
equity markets. In our opinion, the interest rate environment appears
conducive to overseas stocks.
ASSET ALLOCATION PORTFOLIO
The Asset Allocation Portfolio benefited from strong performances overall in
the U.S. stock and bond markets for the six months ended February 29, 1996.
Your Portfolio achieved an 8.11%* total return during this period.
The yield curve for the 30-year Treasury bond shifted dramatically lower
during 1995, dropping to 5.96% by year-end. However, in anticipation of this
decline, we increased the average maturity of the Portfolio's holdings. In
early 1996, the fixed income markets became more volatile as the market
reacted to stronger-than-expected growth, a Federal government shutdown and
the unwinding of leveraged trades. These factors caused the yield on the
30-year Treasury bond to rise from 5.96% at the end of 1995 to 6.48% at the
end of February 1996.
Meanwhile, the U.S. equity market continued to push higher, building on the
momentum begun in early 1995. Stock prices remained strong sparked by
investors who flocked to purchase equities on optimism about a prolonged bull
market. Investors' enthusiasm was fueled by the belief that the U.S. economy
would remain solid and inflation would stay moderate, which should boost the
stock market's performance. Stocks were also expected to benefit from solid
corporate earnings growth in the wake of stable consumer demand and better
inventory and pricing. Other factors expected to contribute to improved
corporate earnings were as follows: the results of prior restructuring
efforts, cost management and a profusion of merger and acquisition activity.
Going forward, we expect volatility to remain a factor in the short term,
although the economic environment should continue to support stock and bond
prices.
ASSET ALLOCATION PORTFOLIO
objective:
seeks a combination of long-term
capital growth and current income
by investing in common stocks,
convertible securities and
government and corporate
fixed-income obligations.
*Total return figures do not include the effect of any insurance or
withdrawal charges.
<PAGE>
page 6
[logo] PERFORMANCE & COMMENTARY
U.S. TREASURY INCOME PORTFOLIO
Investors in the U.S. bond market benefited during the period under review as
bond prices pushed higher and yields continued to move lower. For the six
months ended February 29, 1996, the U.S. Treasury Income Portfolio had a
total return of 3.16%.*
During the course of 1995, the yield on the 30-year Treasury bond fell from
7.89% to 5.96%, providing a total return in excess of 30%, and the yield
curve shifted dramatically lower. Expecting this steeper yield curve, we
increased the average maturity of the Portfolio's holdings.
In early 1996, the fixed income markets were off to a rocky start as market
participants had to deal with indications of stronger- than-anticipated
growth, a Federal government shutdown and the unwinding of leveraged trades.
The yield on the 30-year Treasury bond rose from 5.96% at the end of 1995 to
6.48% at the end of February 1996.
Going forward, we expect the U.S. economy to continue to be bumpy over the
short term, but generally positive for bonds as inflation remains under
control and economic growth continues on its steady--although slow--course.
U.S. TREASURY INCOME PORTFOLIO
objective:
seeks current income as
well as preservation of investors'
principal by investing at least 65%
of its assets in debt obligations
backed by the full faith and credit
of the U.S. government.
shares of the portfolio are neither
insured nor guaranteed by the U.S.
government or any other entity.
MONEY MARKET PORTFOLIO
objective:
seeks to preserve capital and
maintain liquidity while offering
investors the opportunity for
maximum current income.
invests in obligations issued or
guaranteed by U.S. banks,
securities issued by the U.S. government or
its agencies, dollar-
denominated commercial paper and
obligations of foreign
governments.
there is no assurance that the
underlying portfolio will maintain
an NAV of $1.00 per share, nor is
it insured or guaranteed by the
U.S. government.
MONEY MARKET PORTFOLIO
For the sixth-month period ended February 29, 1996, the Money Market
Portfolio's total return was 2.63%.
From August 31 through mid-December 1995, yields on money market instruments
remained relatively steady as the Federal Reserve left short-term rates
unchanged--in sharp contrast to a more significant drop for long-term bond
yields. But, a rate cut in mid-December 1995 and a follow-up rate cut at the
end of January 1996 caused steady declines in money market yields through the
end of February 1996.
At the end of February, most economists believed the Federal Reserve would
not cut rates substantially for the rest of the year, although rate increases
were considered possible in 1997. Based on a projected slow growth rate for
the U.S. economy for the rest of the year, inflation is expected to remain
moderate and under control.
The Money Market Portfolio's 7-day current yield was 3.39% as of February 29,
1996.
*Total return figures do not include the effect of any insurance or
withdrawal charges.
<PAGE>
page 7
GROWTH & INCOME PORTFOLIO [logo]
Portfolio of Investments February 29, 1996 (Unaudited)
LONG-TERM INVESTMENTS 82.2%
COMMON STOCK 76.3%
Issuer Shares $ Value $ Subtotal
AEROSPACE 1.7%
Allied-Signal, Inc. 600 33,375
United Technologies, Corp. 400 43,000 76,375
------------
AIRLINES 1.0%
AMR Corp. * 500 43,875 43,875
------------
AUTOMOTIVE 3.1%
Chrysler Corp. 717 40,421
Echlin, Inc. 1,000 33,875
TRW Inc. 800 69,300 143,596
------------
BANKING 5.7%
Bank of New York Company, Inc. 800 41,500
Citicorp 1,000 78,000
First Bank System Inc. 500 28,813
NationsBank Corp. 1,000 73,750
Norwest Corp. 1,100 40,150 262,213
------------
BROADCASTING 0.5%
U.S. West Media Group* 1,100 22,962 22,962
------------
CHEMICALS 2.2%
Air Products and Chemicals, Inc. 700 37,275
duPont (EI) deNemours 800 61,200 98,475
------------
COMPUTER SOFTWARE 0.6%
General Motors Corp., Class E 500 28,562 28,562
------------
COMPUTERS/COMPUTER HARDWARE 4.7%
Apple Computer, Inc. 800 22,000
Compaq Computer* 1,500 75,938
International Business Machines
Corp. 300 36,787
SCI Systems, Inc.* 900 33,356
Sun Microsystems, Inc.* 900 47,250 215,331
------------
CONSTRUCTION MACHINERY 0.7%
Caterpillar Inc. 500 33,438 33,438
------------
CONSUMER PRODUCTS 3.0%
Adidas AG* 1,500 48,018
Philip Morris Companies, Inc. 600 59,400
Whirlpool Corp. 500 27,812 135,230
------------
ELECTRONICS/ELECTRICAL EQUIPMENT 4.1%
General Motors Class H 1,500 85,875
Hewlett-Packard Co. 400 40,300
Texas Instruments 1,200 59,850 186,025
------------
ENTERTAINMENT 0.9%
Time Warner, Inc. 1,000 42,750 42,750
------------
FINANCIAL SERVICES 1.1%
Federal National Mortgage Assoc. 1,600 50,600 50,600
------------
FOOD/BEVERAGE PRODUCTS 3.0%
CPC International, Inc. 500 34,625
PepsiCo., Inc. 1,200 75,900
Unilever NV, NY Shares 200 26,900 137,425
------------
HEALTH CARE 4.6%
Baxter International Inc. 1,000 45,750
Beverly Enterprises* 2,700 32,738
Columbia/HCA Healthcare Corp. 700 38,325
Humana, Inc.* 900 22,050
Tenet Healthcare Corp.* 3,200 71,600 210,463
------------
HOTELS 0.7%
Bristol Hotel Co.* 1,200 32,250 32,250
------------
INSURANCE 3.6%
American International Group 350 33,819
Chubb Corp. 500 48,563
Highlands Insurance Group* 110 2,241
Mid Ocean, Ltd. (Bermuda) 1,000 39,000
Providian Corp. 900 41,625 165,248
------------
MANUFACTURING 3.2%
Case Corp. 1,400 74,375
Johnson Controls 600 43,050
Varity Corp.* 800 30,200 147,625
------------
METALS/MINING 2.2%
Aluminum Co. of America (ALCOA) 700 39,725
Inco, Ltd. 1,000 31,875
Phelps Dodge Corp. 500 30,562 102,162
------------
OIL & GAS 6.6%
Amoco Corp. 500 34,750
Halliburton Company 1,100 60,362
Mobil Corp. 500 54,813
Panhandle Eastern Corp. 2,200 62,975
Phillips Petroleum Co. 700 24,500
Smith International * 1,500 30,562
Williams Companies, Inc. 700 33,250 301,212
------------
PAPER/FOREST PRODUCTS 1.4%
Champion International Corp. 700 28,000
Willamette Industries 700 36,750 64,750
------------
PHARMACEUTICALS 1.6%
American Home Products Corp. 500 49,250
Glaxo Wellcome Plc 900 24,637 73,887
------------
PRINTING & PUBLISHING 1.0%
Harcourt General, Inc. 1,000 43,375 43,375
------------
RESTAURANTS/FOOD SERVICES 0.8%
Wendy's International, Inc. 1,900 34,437 34,437
------------
RETAILING 6.7%
American Stores Co. 1,000 29,125
Circuit City Stores, Inc. 1,500 44,438
Dayton-Hudson Corp. 1,000 74,375
Kroger Co.* 2,000 74,250
May Department Stores 900 41,963
MSC Industrial Direct Co., Inc.* 1,500 41,625 305,776
------------
SHIPPING/TRANSPORTATION 2.3%
Canadian National Railway Co.* 2,500 43,125
CSX Corp. 1,400 62,825 105,950
------------
STEEL 0.9%
USX-US Steel Group, Inc. 1,200 39,300 39,300
------------
TELECOMMUNICATIONS 2.9%
AT&T Corp. 900 57,263
GTE Corp. 800 34,300
U S West, Inc. 1,200 39,300 130,863
------------
TOYS & GAMES 1.6%
Mattel, Inc. 2,200 73,150 73,150
------------
UTILITIES 3.9%
CMS Energy Corp. 1,400 42,525
FPL Group Inc. 1,600 71,400
Nipsco Industries Inc. 1,000 37,750
Pinnacle West Capital Corp. 1,000 28,375 180,050
------------
TOTAL COMMON STOCK
(COST $2,867,933)
3,487,355
------------
CONVERTIBLE PREFERRED STOCK 3.1%
FINANCIAL SERVICES
International Paper Capital Corp.,
5.25%# 800 36,680
St. Paul Capital LLC, 6.00%, 5/31/25
Series 500 29,375
OIL & GAS
Enron Corp., 6.25% Exchange Notes,
12/13/98 3,000 74,625 74,625
------------
TOTAL CONVERTIBLE PREFERRED STOCK
(COST $130,250) 140,680
------------
Principal
Amount (USD)
CONVERTIBLE CORPORATE BONDS & NOTES 2.8%
FINANCIAL
American Travellers Corp., 6.5%, due
10/1/05 $55,000 76,725
MANUFACTURING
Waban Inc., 6.5%, due 7/1/02 50,000 52,500
TOTAL CONVERTIBLE CORPORATE BONDS &
NOTES (Cost $103,774) 129,225
----------
TOTAL LONG-TERM INVESTMENTS (Cost
$3,101,957) 3,757,260
----------
SHORT-TERM INVESTMENTS 16.9%
COMMERCIAL PAPER
(COST $770,000)
Household Finance, 5.25%,
due 3/1/96 770,000 770,000 770,000
----------
TOTAL INVESTMENTS
(COST $3,871,957) 99.1% $4,527,260
==========
*Non-income producing securities. See NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 8
[logo] CAPITAL GROWTH PORTFOLIO
Portfolio of Investments February 29, 1996 (Unaudited)
LONG-TERM INVESTMENTS 84.0%
COMMON STOCK 84.0%
Issuer Shares $ Value $ Subtotal
AGRICULTURE 2.3%
AGCO Corp. 4,200 113,925 113,925
----------
BANKING 1.7%
Standard Federal Bancorporation, 2,000 82,750 82,750
----------
BUSINESS SERVICES 2.9%
Pittston Services Group 6,000 140,250 140,250
----------
CHEMICALS 1.9%
Cabot Corp. 1,500 90,750 90,750
----------
COMPUTER SOFTWARE 1.8%
Reynolds & Reynolds, Inc., Class A 2,300 87,113 87,113
----------
COMPUTERS/COMPUTER HARDWARE 6.3%
Comdisco, Inc. 4,550 93,275
Gateway 2000 Inc.,* 4,000 118,000
SCI Systems, Inc.* 2,500 92,656 303,931
----------
CONSUMER PRODUCTS 7.9%
Danaher Corp. 2,400 81,600
First Brands Corp. 4,000 107,000
INTERCO, Inc.* 6,000 54,750
Lancaster Colony Corp. 1,500 56,625
Toro Co. 2,500 83,750 383,725
----------
DIVERSIFIED 1.6%
Harnischfeger Industries, Inc. 2,000 75,750 75,750
----------
ELECTRONICS/ELECTRICAL EQUIPMENT 12.4%
ADT Ltd. * 6,000 88,500
Elsag Bailey Process Automation
N.V.* 2,500 53,750
Esterline Technologies Corp.* 5,000 111,250
Lam Research Corp.* 2,500 92,188
Microchip Technology, Inc.* 2,500 69,375
Teradyne Inc.* 4,000 81,500
Varian Associates, Inc. 2,000 104,000 600,563
----------
ENTERTAINMENT 2.2%
Bally Enterainment Corp. * 7,000 108,500 108,500
----------
FINANCIAL SERVICES 3.9%
Advanta Corp., Class A 2,000 95,500
Green Tree Financial Corp. 3,000 94,875 190,375
----------
FOOD/BEVERAGE PRODUCTS 1.7%
Coca-Cola Enterprises, Inc. 3,000 85,125 85,125
----------
HEALTH CARE 3.7%
Integrated Health Services, Inc. 3,500 77,438
Ornda Healthcorp * 4,000 102,500 179,938
----------
HOTELS/OTHER LODGING 1.1%
Bristol Hotel Co.* 2,000 53,750 53,750
----------
INSURANCE 6.9%
Mid Ocean, Ltd. (Bermuda) 2,700 105,300
Reliastar Financial Corp. 1,900 91,200
Transatlantic Holdings, Inc. 2,000 140,500 337,000
----------
MANUFACTURING 1.7%
Kennametal Inc. 2,500 80,937 80,937
----------
METALS/MINING 2.0%
Alumax, Inc. * 2,700 97,538 97,538
----------
OIL & GAS 2.1%
Smith International * 5,000 101,875 101,875
----------
PAPER/FOREST PRODUCTS 1.8%
Boise Cascade Corp. 2,500 88,125 88,125
----------
PHARMACEUTICALS 2.9%
Parexel International Corp.* 4,000 142,000 142,000
----------
REAL ESTATE INVESTMENT TRUST 3.2%
Oasis Residential, Inc. 6,600 156,750 156,750
----------
RETAILING 3.4%
Dillard Department Stores, Inc.,
Class A 3,000 93,750
MSC Industrial Direct Co., Inc.* 2,500 69,375 163,125
----------
SHIPPING / TRANSPORTATION 2.8%
GATX Corp. 1,800 80,775
Pittston Burlington Group 3,000 56,250 137,025
----------
STEEL 1.9%
AK Steel Holding Corp. 2,500 90,312 90,312
----------
TEXTILE MILL PRODUCTS 1.8%
Springs Industries, Inc., Class A 2,000 86,500 86,500
----------
UTILITIES 2.1%
Portland General Corp. 3,300 101,062 101,062
----------
TOTAL COMMON STOCK
(COST $3,457,981) 4,078,694
----------
Principal
Amount (USD)
SHORT-TERM INVESTMENTS 17.1%
COMMERCIAL PAPER
Household Finance, 5.25%, due 3/1/96
(COST $827,000) 827,000 827,000 827,000
----------
TOTAL INVESTMENTS
(COST $4,284,981) 101.1% $4,905,694
==========
*Non-income producing securities. See NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 9
INTERNATIONAL EQUITY PORTFOLIO [logo]
Portfolio of Investments February 29, 1996 (Unaudited)
LONG-TERM INVESTMENTS 91.6%
COMMON STOCK 91.6%
Issuer Shares $ Value $ Subtotal
BELGIUM 0.3%
BANKING
Kredietbank NV 25 6,881 6,881
------------
FRANCE 5.1%
BANKING
Societe Generale de Paris 176 20,089
BROADCASTING & PUBLISHING
TV Francaise (TF1) 192 20,544
COMPUTER SOFTWARE/SERVICES
Group Axime * 121 13,139
CONSUMER PRODUCTS
SEITA 571 22,783
FINANCIAL SERVICES
Cetelem Group * 125 26,303
PHARMACEUTICALS
Roussel-Uclaf 91 19,329
UTILITIES
Cie Generale Des Eaux 149 14,937
Total France 137,124
------------
GERMANY 6.8%
AIRLINES
Lufthansa 221 34,587
AUTOMOTIVE
Volkswagen AG 65 24,735
CHEMICALS
Bayer AG 56 17,097
CONSUMER PRODUCTS
Adidas AG, ADS * 1,133 36,271
Adidas AG * 17 1,089
MACHINERY
Mannesmann AG 63 22,537
OIL & GAS
VEBA AG 622 29,300
RETAILING
Asko Deutsche Kaufhaus AG 34 18,169
Total Germany 183,785
------------
HONG KONG 6.7%
BANKING
HSBC Holdings PLC 1,000 16,041
DIVERSIFIED
Hutchison Whampoa 7,000 44,370
FINANCIAL SERVICES
Guoco Group Ltd. * 2,000 10,659
REAL ESTATE
Henderson Land Development
Company, Ltd. 3,000 21,732
New World Development
Company, Ltd. 5,000 24,384
Swire Pacific, Ltd, Class A * 4,500 39,293
UTILITIES
China Light & Power Co. 5,000 23,414
Total Hong Kong 179,893
------------
INDONESIA 1.2%
TELECOMMUNICATIONS
PT Telekomunikasi Indonesia, ADR * 1,000 31,375 31,375
------------
IRELAND 1.9%
BANKING
Bank of Ireland 4,092 28,210
INSURANCE
Irish Life Plc 5,615 21,678
Total Ireland 49,888
------------
ITALY 2.3%
TELECOMMUNICATIONS
Telecom Italia Mobile SpA, 33,938 62,313 62,313
------------
JAPAN 32.0%
AEROSPACE
Ishikawajima-Harima Heavy Industries 4,000 17,320
AUTOMOTIVE
Nissan Motor Co, Ltd., 10,000 77,465
Toyota Motor Corp. 3,000 64,808
BANKING
Mitsui Trust & Banking 5,000 51,389
BUSINESS SERVICES
Ricoh Corp. Ltd 3,000 32,261
ELECTRICAL & ELECTRONIC
EQUIPMENT
Mitsubishi Electric Corp. 10,000 73,278
Rohm Company 1,000 59,478
FINANCIAL SERVICES
New Japan Securities * 1,000 5,881
Nikko Securities Co. Ltd. 5,000 56,624
MANUFACTURING
NTN Corp. 8,000 53,521
PACKAGING
Tomoku Co. Ltd. 10,000 53,102
Toto Ltd. 2,000 27,788
PAPER/FOREST PRODUCTS
Mitsubishi Paper Mills 4,000 24,933
RETAILING
Tokyu Department Store 4,000 25,276
Tokyu Corp. 13,000 94,271
TEXTILES
Toray Industries, Inc. 2,000 12,962
TOYS
Bandai Co. Limited 2,000 78,607
WHOLESALING
Itochu Corp. 8,000 53,597
Total Japan 862,561
------------
MALAYSIA 2.4%
FINANCIAL SERVICES
DCB Holdings Bhd 21,000 63,886 63,886
------------
NETHERLANDS 5.6%
APPLIANCES & HOUSEHOLD DURABLES
Philips Gloeilampen 822 34,238
BROADCASTING & PUBLISHING
Verenigde Nederlandse Uitgevbedri
Verigd Bezit (Vnu) 1,820 29,769
CHEMICALS
Akzo Nobel 251 27,945
FINANCIAL SERVICES
International Nederlanden Groep NV * 426 28,312
TELECOMMUNICATIONS
Royal PTT Nederland NV 797 32,033
Total Netherlands 152,297
------------
SPAIN 2.5%
BUSINESS SERVICES
Prosegur, CIA de Seguridad SA * 595 21,656
OIL/GAS
Repsol SA 600 21,935
UTILITIES
Iberdrola S.A. 2,373 23,415
Total Spain 67,006
------------
SWEDEN 2.9%
MACHINERY & ENGINEERING
EQUIPMENT
Atlas Copco AB 1,471 25,517
Svedala Industri AB Free 994 30,654
TELECOMMUNICATIONS
Telefonaktiebolaget LM Ericsson, 'B'
Shares 1,000 21,720
Total Sweden
77,891
------------
SWITZERLAND 3.7%
PHARMACEUTICALS
Ciba-Geigy AG (Registered Shares) 45 40,243
Roche Holding AG 4 31,129
Sandoz AG (Registered Shares) 31 29,147
Total Switzerland 100,519
------------
THAILAND 3.6%
BANKING
Bangkok Bank Public Company, Ltd. 4,800 43,429
Siam City Bank Public Co. Ltd. 27,000 29,732
TELECOMMUNICATIONS
Loxley Company Ltd (Foreign) 1,400 24,778
Total Thailand 97,939
------------
UNITED KINGDOM 14.6%
AUTOMOTIVE
Kwik-Fit Holdings PLC 2,479 7,482
BROADCASTING
General Cable PLC * 5,797 16,163
CHEMICALS
BTP PLC 1,500 6,802
CONSTRUCTION
Berkeley Group PLC 969 8,387
George Wimpey PLC 3,189 6,766
CONSUMER PRODUCTS
B.A.T. Industries PLC * 1,469 12,862
ENGINEERING SERVICES
Barratt Developments PLC 2,102 8,099
Senior Engineering Group Plc 8,865 14,464
FOOD/BEVERAGE PRODUCTS
Allied Domecq PLC 1,698 13,475
Associated British Foods PLC 3,463 21,009
Unigate PLC 1,000 6,810
Wolverhampton & Dudley
Breweries, PLC 832 7,979
HOTELS/OTHER LODGING
Greenalls Group PLC 1,280 11,256
Insurance
General Accident PLC 1,924 18,938
Lloyds Abbey Life Group 1,962 15,329
MACHINERY & ENGINEERING
EQUIPMENT
Powerscreen International Plc 2,726 16,788
MANUFACTURING
Cookson Group PLC 2,576 12,194
OIL/GAS
Enterprise Oil PLC 2,284 13,402
PACKAGING
David S. Smith (Holdings) PLC 2,675 12,499
*Non-income producing securities. See NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 10
[logo] INTERNATIONAL EQUITY PORTFOLIO
Portfolio of Investments February 29, 1996 (Unaudited)
Issuer Shares $ Value $ Subtotal
RESTAURANTS/FOOD SERVICES
Compass Group PLC 1,044 7,781
RETAILING
Great Universal Stores PLC 1,210 12,313
SHIPPING/TRANSPORTATION
British Airport Authority PLC * 1,036 7,761
Ocean Group PLC 1,119 6,645
Transport Development Group PLC 2,210 7,279
TELECOMMUNICATIONS
British Telecommunications PLC 3,465 19,763
UTILITIES
Anglian Water PLC 1,086 9,438
East Midlands Electricity PLC * 980 10,847
London Electricity PLC 1,835 20,757
National Grid Group PLC * 1 3
National Power PLC 4,372 23,309
Severn Trent PLC 1,008 9,574
South West Water PLC * 986 7,417
Southern Electricity PLC * 637 8,283
Thames Water PLC 1,399 11,408
Total United Kingdom 393,282
------------
TOTAL COMMON STOCK
(COST $2,286,115) 2,466,640
------------
WARRANTS 0.0%
MALAYSIA
DIVERSIFIED
IOI Corp., Bhd (Cost $1,065) 11,750 1,060
------------
Total Long-term Investments 2,467,700
(Cost $2,287,180) ------------
Principal
Amount (USD)
SHORT-TERM INVESTMENTS 5.5%
COMMERCIAL PAPER
UNITED STATES
Household Finance, 5.38%,
due 3/1/96,
(Cost $149,000) $149,000 149,000 149,000
------------
TOTAL INVESTMENTS
(COST $2,436,180) 97.1% $2,616,700
============
*Non-income producing securities. See NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 11
ASSET ALLOCATION PORTFOLIO [logo]
Portfolios of Investments February 29, 1996 (Unaudited)
LONG-TERM INVESTMENTS 91.8%
COMMON STOCK 56.2%
Issuer Shares $ Value $Subtotal
BROADCASTING 0.5%
U.S. West Media Group* 700 14,613
------------
AEROSPACE 1.3%
Allied-Signal, Inc. 300 16,688
United Technologies, Corp. 200 21,500
38,188
------------
AIRLINES 0.9%
AMR Corp.* 300 26,325 26,325
------------
AUTOMOTIVE 2.4%
Chrysler Corp. 409 23,057
Echlin, Inc. 500 16,938
TRW Inc. 400 34,650
74,645
------------
BANKING 4.3%
Bank of New York Company, Inc. 400 20,750
Citicorp 500 39,000
First Bank System Inc. 300 17,288
NationsBank Corp. 500 36,875
Norwest Corp. 500 18,250 132,163
------------
CHEMICALS 1.5%
Air Products and Chemicals, Inc. 300 15,975
duPont (EI) deNemours 400 30,600 46,575
------------
COMPUTER SOFTWARE 0.9%
General Motors Corp., Class E 500 28,563 28,563
------------
COMPUTERS/COMPUTER HARDWARE 3.4%
Apple Computer, Inc. 400 11,000
Compaq Computer* 700 35,438
International Business Machines
Corp. 100 12,263
SCI Systems, Inc.* 500 18,531
Sun Microsystems, Inc.* 500% 26,250 103,482
------------
CONSTRUCTION MACHINERY 0.4%
Caterpillar Inc. 200 13,375 13,375
------------
CONSUMER PRODUCTS 2.1%
Adidas AG* 700 22,408
Philip Morris Companies, Inc. 300 29,700
Whirlpool Corp. 200 11,125 63,233
------------
ELECTRONICS / ELECTRICAL
EQUIPMENT 2.9%
General Motors Class H 700 40,075
Hewlett-Packard Co. 200 20,150
Texas Instruments 600 29,925 90,150
------------
ENTERTAINMENT 0.7%
Time Warner, Inc. 500 21,375 21,375
------------
FINANCIAL SERVICES 0.8%
Federal National Mortgage Assoc. 800 25,300 25,300
------------
FOOD/BEVERAGE PRODUCTS 2.1%
CPC International, Inc. 200 13,850
PepsiCo., Inc. 600 37,950
Unilever NV, NY Shares 100 13,450 65,250
------------
HEALTH CARE 3.2%
Baxter International Inc. 500 22,875
Beverly Enterprises* 1,200 14,550
Columbia/HCA Healthcare Corp. 300 16,425
Humana, Inc.* 500 12,250
Tenet Healthcare Corp.,* 1,500 33,563 99,663
------------
HOTELS/OTHER LODGING 0.5%
Bristol Hotel Co.* 600 16,125 16,125
------------
INSURANCE 2.9%
American International Group 300 28,988
Chubb Corp. 200 19,425
Highlands Insurance Group* 60 1,223
Mid Ocean, Ltd. (Bermuda) 500 19,500
Providian Corp. 400 18,500
87,636
------------
MANUFACTURING 2.4%
Case Corp. 700 37,188
Johnson Controls 300 21,525
Varity Corp.* 400 15,100 73,813
------------
METALS/MINING 1.5%
Aluminum Co. of
America (ALCOA) 300 17,025
Inco, Ltd. 500 15,937
Phelps Dodge Corp. 200 12,225
45,187
------------
OIL & GAS 5.0%
Amoco Corp. 200 13,900
Halliburton Company 600 32,925
Mobil Corp. 300 32,887
Panhandle Eastern Corp. 1,200 34,350
Phillips Petroleum Co. 300 10,500
Smith International * 700 14,262
Williams Companies, Inc. 300 14,250 153,074
------------
PAPER/FOREST PRODUCTS 1.2%
Champion International Corp. 400 16,000
Willamette Industries 400 21,000 37,000
------------
PHARMACEUTICALS 1.4%
American Home Products Corp. 300 29,550
Glaxo Wellcome Plc 500 13,687 43,237
------------
PRINTING & PUBLISHING 0.7%
Harcourt General, Inc. 500 21,687 21,687
------------
RESTAURANTS/FOOD SERVICES 0.5%
Wendy's International, Inc. 800 14,500 14,500
------------
RETAILING 4.7%
American Stores Co. 400 11,650
Circuit City Stores, Inc. 800 23,700
Dayton-Hudson Corp. 500 37,187
Kroger Co.* 1,100 40,837
May Department Stores 400 18,650
MSC Industrial Direct Co., Inc.* 500 13,875 145,899
---------- ------------
SHIPPING/TRANSPORTATION 1.4%
CSX Corp. 600 26,925
Canadian National Railway Co.* 1,000 17,250 44,175
------------
STEEL 0.5%
USX-US Steel Group, Inc. 500 16,375 16,375
------------
TELECOMMUNICATIONS 2.1%
AT&T Corp., 400 25,450
GTE Corp. 400 17,150
U S West, Inc. 700 22,925 65,525
------------
TOYS & GAMES 1.2%
Mattel, Inc. 1,000 36,575 36,575
------------
UTILITIES 2.8%
CMS Energy Corp. 600 18,225
FPL Group Inc. 800 35,700
Nipsco Industries Inc. 500 18,875
Pinnacle West Capital Corp. 400 11,350 84,150
------------
TOTAL COMMON STOCK
(Cost $1,416,350 1,727,858
------------
CONVERTIBLE PREFERRED STOCK 2.9%
FINANCIAL SERVICES
St. Paul Capital LLC, 6.00%, 5/31/25
Series 700 41,125
INDUSTRIAL
International Paper Capital Corp.,
5.25%# 400 18,340
OIL & GAS
Enron Corp., 6.25% Exchange Notes,
12/13/98, ACE 1,200 29,850
TOTAL CONVERTIBLE PREFERRED STOCK
(Cost $81,100) 89,315
------------
Principal
Amount (USD)
Convertible Corporate Bonds 2.8%
INSURANCE
American Travellers Corp., 6.5%,
due 10/1/95 25,000 34,875
MANUFACTURING
Waban Inc., 6.5%, due 7/1/02 50,000 52,500
TOTAL CONVERTIBLE CORPORATE BONDS
(Cost $73,774) 87,375
------------
NON-CONVERTIBLE CORPORATE BONDS 3.9%
FINANCE
General Electric Credit Corp.,
9.18%, due 12/30/08 100,000 119,461 119,461
(Cost $121,109) ------------
U.S. GOVERNMENT AND AGENCY
OBLIGATIONS 26.0%
U.S. Treasury Note, 5.625%, due
2/15/06 200,000 192,688
U.S. Treasury Note, 6.125%, due
9/30/00 100,000 101,516
U.S. Treasury Note, 6.5%, due
8/15/05 90,000 92,067
U.S. Treasury Bond, 8.5%, due
2/15/20 125,000 152,577
Federal Home Loan Bank, 7.54%, due
2/13 250,000 259,140
Total U.S. Government and Agency
Obligations 797,988
(Cost $792,821) ------------
TOTAL LONG-TERM INVESTMENTS
(Cost $2,485,154) 2,821,997
SHORT-TERM INVESTMENTS 7.4%
COMMERCIAL PAPER
Household Finance Corp., 5.375%, due
3/1/96 229,000 229,000 229,000
(Cost $229,000) ------------
TOTAL INVESTMENTS
(Cost $2,714,154) 99.2% $3,050,997
============
*Non-income producing securities. SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 12
[logo] U.S. TREASURY INCOME PORTFOLIO
Portfolio of Investments February 29, 1996 (Unaudited)
LONG-TERM INVESTMENTS 87.5%
<TABLE>
<CAPTION>
Issuer Principal
Amount $ $ Value
<S> <C> <C> <C>
U.S. GOVERNMENT OBLIGATIONS 28.1%
U.S. Treasury Bond 10.75%, due 8/15/05 60,000 79,435
U.S. Treasury Bond 8.50%, due 2/15/20 400,000 488,248
U.S. Treasury Note 6.50%, due 8/15/05 175,000 179,020
------------
TOTAL U.S. GOVERNMENT OBLIGATIONS (Cost $748,908) 746,703
------------
U.S. GOVERNMENT AGENCY OBLIGATIONS 15.6%
Federal Farm Credit Bank,
Medium Term Note 7.51%, due 2/13/98 200,000 207,188
Federal Home Loan Bank 7.54%, due 2/13/98 200,000 207,312
------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $404,875) 414,500
------------
U.S. GOVERNMENT AGENCY SPONSORED OBLIGATIONS 7.7%
Student Loan Marketing Association 7%, due 3/3/98
(Cost $199,634) 200,000 205,532
------------
MORTGAGE PASS-THROUGH CERTIFICATES 36.1%
Government National Mortgage
Association, Pool #3547, 6.5%, due 3/15/94
(Cost $906,013) 994,369 958,631
------------
TOTAL LONG-TERM INVESTMENTS (Cost $2,259,430) 2,325,366
------------
SHORT-TERM INVESTMENTS 12.5%
U.S. GOVERNMENT OBLIGATIONS 5.8%
U.S. Treasury Bill, 4.84%, due 4/18/96 25,000 24,839
U.S. Treasury Bill 4.985%, due 4/18/96 130,000 129,136
------------
TOTAL U.S. GOVERNMENT OBLIGATIONS (Cost $153,975) 153,975
------------
U.S. GOVERNMENT AGENCY SPONSORED OBLIGATIONS 6.7%
Federal National Mortgage
Association 5.11%, due 3/22/96 180,000 179,463
(Cost $179,463) ------------
TOTAL SHORT-TERM INVESTMENTS (Cost $333,438) 333,438
------------
TOTAL INVESTMENTS (Cost $2,592,868) 100.0% 2,658,804
============
</TABLE>
See NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 13
MONEY MARKET PORTFOLIO [logo]
Portfolio of Investments February 29, 1996 (Unaudited)
<TABLE>
<CAPTION>
Principal
Issuer Amount $ $ Value
<S> <C> <C> <C>
U.S GOVERNMENT AGENCY DISCOUNT NOTE
OBLIGATION 35.4%
Federal Home Loan Mortgage Corp.,
(Cost $861,623) due 3/4/96 862,000 861,623
------------
CORPORATE BONDS & NOTES 30.3%
Continental Bank Corp. 9.875%, due 6/15/96,
(Bank of America) 250,000 252,691
Ford Motor Credit Corp. 8.00%, due 12/1/96, 100,000 102,062
International Lease Finance 7.90%, due 10/1/96, 125,000 126,414
NCNB Corp. 8.5%, due 11/1/96, 250,000 254,232
------------
735,399
------------
TOTAL CORPORATE BONDS & NOTES
(Cost $735,399)
FLOATING RATE NOTES 32.9%
Avco Financial Services 5.53%, due 3/1/96 250,000 249,995
Student Loan Marketing Association 5.14%, due 3/5/96 300,000 299,825
General Electric Capital Corp. 5.46%, due 3/1/96 250,000 250,000
------------
799,820
------------
TOTAL FLOATING RATE NOTES
(Cost 799,820)
TOTAL INVESTMENTS 98.6% 2,396,842
============
(Cost 2,396,842)**
</TABLE>
** The cost of securities is substantially the same for federal income tax
purposes.
Floating Rate Notes: The maturity date shown is the next interest rest date;
the rate shown is the rate in effect at February 29, 1996.
# = Security may only be sold to institutional buyers.
* = Non-income producing securities.
ACES = Automatic CM Exchange Securities
ADS = American Depository Security
See NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 14
[logo] STATEMENT OF ASSETS AND LIABILITIES
FEBRUARY 29, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
U.S.
Growth Capital Intl. Asset Treasury Money
& Income Growth Equity Allocation Income Market
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
-------- -------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Investment securities, at value (Note
1) $4,527,260 $4,905,694 $2,616,700 $3,050,997 $2,658,804 $2,396,842
Cash 603 337 145 332 808
Foreign Currency (Cost $42,760) -- -- 42,655 -- -- --
Receivables:
Open forward foreign currency
contracts -- -- 11,243 -- -- --
Investment securities sold -- 84,880 19,130 -- -- --
Dividends and Interest 12,047 1,641 6,150 15,349 15,949 25,986
Expense reimbursement from
Distributor 6,985 2,951 39,555 14,689 3,297 21,945
Shares of beneficial interest sold 37,850 32,488 -- 8,860 -- --
-------- -------- -------- -------- -------- ----------
TOTAL ASSETS 4,584,745 5,027,991 2,735,578 3,090,227 2,678,050 2,445,581
-------- -------- -------- -------- -------- ----------
LIABILITIES:
Payable for investment securities
purchased -- 155,971 13,762 -- -- --
Payable for shares of beneficial
interest redeemed 51 2,047 -- 8 354 7
Payable for open forward foreign
currency contracts -- -- 2,445 -- -- --
Other liabilities -- 299 -- -- 5,101 88
Accrued liabilities: (Note 2)
Custody fees 3,336 3,097 3,007 2,290 1,650 2,573
Other 11,331 12,417 22,478 12,447 12,362 12,492
-------- -------- -------- -------- -------- ----------
TOTAL LIABILITIES 14,718 173,831 41,692 14,745 19,467 15,160
-------- -------- -------- -------- -------- ----------
NET ASSETS:
Paid in capital 3,447,785 3,485,369 2,317,023 2,466,543 2,455,934 2,430,421
Accumulated undistributed net
investment income (loss) 12,204 6,263 (1,851) 13,960 26,286 6
Accumulated net realized gain (loss)
on investment transactions 454,735 741,815 189,612 258,136 110,428 (6)
Net unrealized
appreciation/depreciation of
investments and forward foreign
currency transactions 655,303 620,713 189,102 336,843 65,935 --
-------- -------- -------- -------- -------- ----------
NET ASSETS APPLICABLE TO INVESTORS'
BENEFICIAL INTERESTS $4,570,027 $4,854,160 $2,693,886 $3,075,482 $2,658,583 $2,430,421
======== ======== ======== ======== ======== ==========
Shares of beneficial interest
outstanding
(no par value; unlimited number of
shares authorized) 375,043 381,994 254,900 282,969 277,466 2,430,412
Net asset value, redemption price per
share and maximum offering price per
share $ 12.19 $ 12.71 $ 10.57 $ 10.87 $ 9.58 $ 1.00
Cost of investments $3,871,957 $4,284,981 $2,436,180 $2,714,154 $2,592,868 $2,396,842
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 15
[logo}
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED FEBRUARY 29, 1996 (UNAUDITED)
<TABLE>
<CAPTION>
U.S.
Growth Capital Intl. Asset Treasury Money
& Income Growth Equity Allocation Income Market
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
<S> <C> <C> <C> <C> <C> <C>
-------- -------- -------- -------- -------- ----------
INVESTMENT INCOME (NOTE 1C):
Interest $ 24,841 $ 20,512 $ 4,512 $ 69,573 $151,109 $123,984
Dividends 48,237 32,805 30,378 24,206 -- --
Foreign taxes withheld -- (113) (5,677) -- -- --
-------- -------- -------- -------- -------- ----------
TOTAL INVESTMENT INCOME 73,078 53,204 29,213 93,779 151,109 123,984
-------- -------- -------- -------- -------- ----------
EXPENSES:
Investment advisory fees (Note 2) 16,860 17,952 17,928 12,817 11,186 5,348
Administration fees (Note 2) 1,405 1,496 1,120 1,165 1,119 1,070
Sub-administration fees (Note 2) 4,215 4,488 3,362 3,496 3,356 3,209
Accounting fees -- -- 28,373 -- -- --
Custodian fees 12,056 8,177 4,800 12,698 4,005 3,168
Professional fees 17,234 18,509 21,000 19,084 13,746 16,444
Registration costs 79 79 80 79 79 85
Trustees fees 168 178 165 138 132 127
Miscellaneous expenses 2,738 2,937 9,789 2,498 3,233 9,887
-------- -------- -------- -------- -------- ----------
TOTAL EXPENSES 54,755 53,816 86,617 51,975 36,856 39,338
-------- -------- -------- -------- -------- ----------
Less fees waived by the Advisor,
Administrator & Sub-Administrator
(Note 2E) 22,480 23,936 22,410 17,478 15,661 9,627
Less amounts borne by VFD (Note 2) 6,985 2,951 39,555 14,689 3,297 17,945
-------- -------- -------- -------- -------- ----------
NET EXPENSES 25,290 26,929 24,652 19,808 17,898 11,766
-------- -------- -------- -------- -------- ----------
NET INVESTMENT INCOME 47,788 26,275 4,561 73,971 133,211 112,218
-------- -------- -------- -------- -------- ----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON:
Investment transactions 461,366 715,224 249,184 265,518 121,838 (6)
Foreign currency transactions -- -- (9,594) -- -- --
CHANGE IN NET UNREALIZED
APPRECIATION/
DEPRECIATION ON:
Investments 33,086 (219,466) (183,209) 2,395 (48,671) --
Foreign currency contracts and
foreign currency translations -- -- (1,867) -- -- --
-------- -------- -------- -------- -------- ----------
Net realized and unrealized gain
(loss) 494,452 495,758 54,514 267,913 73,167 (6)
-------- -------- -------- -------- -------- ----------
Net increase in net assets from
operations $542,240 $ 522,033 $ 59,075 $341,884 $206,378 $112,212
======== ======== ======== ======== ======== ==========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 16
[logo] STATEMENT OF CHANGES IN NET ASSETS (UNAUDITED)
<TABLE>
<CAPTION>
Growth and Income Capital Growth International Equity
Portfolio Portfolio Portfolio
------------------- ------------------- --------------------
09/01/95 03/01/95* 09/01/95 03/01/95* 09/01/95 03/01/95*
through through through through through through
02/29/96 08/31/95 02/29/96 08/31/95 02/29/96 08/31/95
-------- ------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 47,788 $ 59,617 $ 26,275 $ 29,126 $ 4,561 $ 50,982
Net realized gain (loss) on investment
and foreign currency transactions 461,366 72,703 715,224 100,990 239,590 18,895
Change in net unrealized
appreciation/depreciation on
investments
and foreign currency translations 33,086 622,216 (219,466) 840,179 (185,076) 374,178
----------- ---------- ----------- ---------- ----------- ----------
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 542,240 754,536 522,033 970,295 59,075 444,055
----------- ---------- ----------- ---------- ----------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (95,201) -- (49,138) -- (57,394) --
Net realized gain on investment
transactions (79,334) -- (74,399) -- (68,873) --
----------- ---------- ----------- ---------- ----------- ----------
(174,535) -- (123,537) -- (126,267) --
----------- ---------- ----------- ---------- ----------- ----------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTERESTS:
Proceeds from shares sold 788,111 5,493,551 1,017,252 5,359,497 153,755 5,037,711
Reinvestment of distributions 174,535 -- 123,537 -- 126,267 --
Payment for shares redeemed: (3,006,940) (1,471) (3,013,702) (1,215) (3,000,490) (220)
----------- ---------- ----------- ---------- ----------- ----------
NET INCREASE (DECREASE) FROM
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS: (2,044,294) 5,492,080 (1,872,913) 5,358,282 (2,720,468) 5,037,491
----------- ---------- ----------- ---------- ----------- ----------
NET INCREASE (DECREASE) IN NET ASSETS (1,676,589) 6,246,616 (1,474,417) 6,328,577 (2,787,660) 5,481,546
NET ASSETS:
Beginning of period 6,246,616 -- 6,328,577 -- 5,481,546 --
=========== ========== =========== ========== =========== ==========
END OF PERIOD $ 4,570,027 $6,246,616 $ 4,854,160 $6,328,577 $ 2,693,886 $5,481,546
=========== ========== =========== ========== =========== ==========
</TABLE>
* Commencement of operations.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 17
[logo]
<TABLE>
<CAPTION>
U.S. Treasury
Asset Allocation Income Money Market
Portfolio Portfolio Portfolio
------------------- ------------------- --------------------
09/01/95 03/01/95* 09/01/95 03/01/95* 09/01/95 03/01/95*
through through through through through through
02/29/96 08/31/95 02/29/96 08/31/95 02/29/96 08/31/95
-------- ------- -------- ------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income $ 73,971 $ 102,855 $ 133,211 $ 162,500 $ 112,218 $ 141,356
Net realized gain (loss) on investment
and foreign currency transactions 265,518 81,344 121,838 69,608 (6) 134
Change in net unrealized
appreciation/depreciation on
investments
and foreign currency translations 2,395 334,448 (48,671) 114,606 -- --
----------- ---------- ----------- ---------- ----------- ----------
INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 341,884 518,647 206,378 346,714 112,212 141,490
----------- ---------- ----------- ---------- ----------- ----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (162,866) -- (269,425) -- -- --
Net realized gain on investment
transactions (88,726) -- (81,018) -- (112,346) (141,356)
----------- ---------- ----------- ---------- ----------- ----------
(251,592) -- (350,443) -- (112,346) (141,356)
----------- ---------- ----------- ---------- ----------- ----------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Proceeds from shares sold 188,497 5,027,177 71,287 5,043,986 334,753 5,295,109
Reinvestment of distributions 251,592 -- 350,443 -- 112,287 141,356
Payment for shares redeemed: (3,000,633) (90) (3,009,000) (782) (3,438,837) (14,247)
----------- ---------- ----------- ---------- ----------- ----------
NET INCREASE (DECREASE) FROM
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS: (2,560,544) 5,027,087 (2,587,270) 5,043,204 (2,991,797) 5,422,218
----------- ---------- ----------- ---------- ----------- ----------
NET INCREASE (DECREASE) IN NET ASSETS (2,470,252) 5,545,734 (2,731,335) 5,389,918 (2,991,931) 5,422,352
NET ASSETS:
Beginning of period 5,545,734 -- 5,389,918 -- 5,422,352 --
----------- ---------- ----------- ---------- ----------- ----------
END OF PERIOD $ 3,075,482 $5,545,734 $ 2,658,583 $5,389,918 $ 2,430,421 $5,422,352
=========== ========== =========== ========== =========== ==========
</TABLE>
* Commencement of operations.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 18
[logo] SELECTED DATA AND RATIOS
FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING
THROUGHOUT EACH PERIOD INDICATED (Unaudited)
<TABLE>
<CAPTION>
Growth and Income Capital Growth International Equity
Portfolio Portfolio Portfolio
------------------ ------------------ --------------------
09/01/95 03/01/95* 09/01/95 03/01/95* 09/01/95 03/01/95*
through through through through through through
02/29/96 08/31/95 02/29/96 08/31/95 02/29/96 08/31/95
------- ------- ------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period $11.48 $10.00 $11.90 $10.00 $10.89 $10.00
------- ------- ------- ------- ------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.223 0.110 0.104 0.055 0.020 0.101
Net Gains or Losses in Securities (both
realized and unrealized) 1.032 1.370 1.063 1.845 0.210 0.789
------- ------- ------- ------- ------- ---------
TOTAL FROM INVESTMENT OPERATIONS 1.255 1.480 1.167 1.900 0.230 0.890
------- ------- ------- ------- ------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income 0.300 -- 0.142 -- 0.320 --
Distributions from capital gains 0.250 -- 0.215 -- 0.230 --
------- ------- ------- ------- ------- ---------
Total Distributions 0.550 -- 0.357 -- 0.550 --
------- ------- ------- ------- ------- ---------
NET ASSET VALUE, END OF PERIOD $12.19 $11.48 $12.71 $11.90 $10.57 $10.89
------- ------- ------- ------- ------- ---------
TOTAL RETURN + 11.22% 14.80% 9.89% 19.00% 2.22% 8.90%
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (000 omitted) $4,570 $6,247 $4,854 $6,329 $2,694 $5,482
RATIOS TO AVERAGE NET ASSETS:#
RATIO OF EXPENSES 0.90% 0.90% 0.90% 0.90% 1.10% 1.09%
RATIO OF NET INVESTMENT INCOME 1.71% 2.14% 0.88% 1.04% .20% 1.92%
RATIO OF EXPENSES WITHOUT WAIVERS AND
ASSUMPTION OF EXPENSES 1.96% 1.80% 1.80% 1.80% 3.89% 2.90%
RATIO OF NET INVESTMENT INCOME WITHOUT
WAIVERS AND ASSUMPTION OF EXPENSES 0.65% 1.24% (0.02%) 0.14% (2.59%) 0.11%
PORTFOLIO TURNOVER RATE 22% 32% 54% 28% 80% 75%
</TABLE>
* Commencement of operations. + Total return figures do not include the
effect of any insurance or withdrawal charges.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 19
[logo]
<TABLE>
<CAPTION>
U.S. Treasury
Asset Allocation Income Money Market
Portfolio Portfolio Portfolio
------------------ ------------------ --------------------
09/01/95 03/01/95* 09/01/95 03/01/95* 09/01/95 03/01/95*
through through through through through through
02/29/96 08/31/95 02/29/96 08/31/95 02/29/96 08/31/95
------- ------- ------- ------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Perio $11.04 $10.00 $ 10.69 $10.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income 0.515 0.205 0.906 0.322 0.026 0.028
Net Gains or Losses in Securities (both
realized and unrealized) 0.350 0.835 (0.541) 0.368 -- --
------- ------- ------- ------- ------- ---------
TOTAL FROM INVESTMENT OPERATIONS 0.865 1.040 0.365 0.690 0.026 0.028
------- ------- ------- ------- ------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income 0.670 -- 1.134 -- 0.026 0.028
Distributions from capital gains 0.365 -- 0.341 -- -- --
------- ------- ------- ------- ------- ---------
Total Distributions 1.035 -- 1.475 -- 0.026 0.028
------- ------- ------- ------- ------- ---------
NET ASSET VALUE, END OF PERIOD $10.87 $11.04 $ 9.58 $10.69 $ 1.00 $ 1.00
======= ======= ======= ======= ======= =========
TOTAL RETURN + 8.11% 10.40% 3.16% 6.90% 2.63% 2.79%
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (000 omitted) $3,075 $5,546 $ 2,659 $5,390 $2,430 $5,422
RATIOS TO AVERAGE NET ASSETS:#
RATIO OF EXPENSES 0.85% 0.85% 0.80% 0.80% 0.55% 0.55%
RATIO OF NET INVESTMENT INCOME 3.19% 3.86% 5.99% 6.19% 5.26% 5.46%
RATIO OF EXPENSES WITHOUT WAIVERS AND
ASSUMPTION OF EXPENSES 2.24% 1.65% 1.51% 1.62% 1.84% 1.21%
RATIO OF NET INVESTMENT INCOME WITHOUT
WAIVERS AND ASSUMPTION OF 1.80% 3.06% 5.28% 5.37% 3.97% 4.80%
PORTFOLIO TURNOVER RATE 33% 45% 61% 46% -- --
</TABLE>
* Commencement of operations. + Total return figures do not include the
effect of any insurance or withdrawal charges. # Short periods have been
annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
page 20
[logo] NOTES TO FINANCIAL STATEMENTS (Unaudited)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES--Mutual Fund Variable
Annuity Trust (the "Trust") was organized on April 14, 1994 as a
Massachusetts business trust, and is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment
company. The Trust was established to provide a funding medium for
variable annuity contracts issued by life insurance companies. Shares of
the Trust are issued only to insurance company separate accounts in
connection with the variable annuity contracts. The Trust issues six
separate series of shares (the "Portfolio(s)") each of which represents
a separately managed portfolio of securities with its own investment
objectives. The Portfolios are the Growth and Income Portfolio ("GIP"),
Capital Growth Portfolio ("CGP"), International Equity Portfolio
("IEP"), Asset Allocation Portfolio ("AAP"), U.S. Treasury Income
Portfolio ("USTIP"), and Money Market Portfolio ("MMP").
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts and disclosures in the
financial statements. Actual results could differ from those estimates.
THE FOLLOWING IS A SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES FOLLOWED
BY THE PORTFOLIOS:
A. Valuation of Investments--Equity securities and options are valued
at the last sale price on the exchange on which they are primarily
traded, including the NASDAQ National Market. Securities for which
sale prices are not available and other over-the-counter
securities are valued at the last quoted bid price. Bonds and
other fixed income securities (other than short-term
obligations), including listed issues, are valued on the basis of
valuations furnished by a pricing service. In making such
valuations, the pricing service utilizes both dealer-supplied
valuations and electronic data processing techniques that take
into account appropriate factors such as institutional-sized
trading in similar groups of securities, yield, quality, coupon
rate, maturity, type of issue, trading characteristics and other
market data, without exclusive reliance upon quoted prices.
Short-term obligations are valued at amortized cost if acquired
with fewer than 61 days to maturity, or at value, based on quoted
exchange or over-the-counter prices, until the 61st day prior to
maturity and thereafter by amortizing the value on the 61st day to
par at maturity. Portfolio securities for which there are no such
quotations or valuations are valued at fair value as determined in
good faith by or at the direction of the Trustees.
B. Security Transactions and Investment Income-- Investment
transactions are accounted for on the trade date (the date the
order to buy or sell is executed). Securities gains and losses are
calculated on the identified cost basis. Interest income is
accrued as earned. Dividend income is recorded on the ex-dividend
date.
C. Repurchase agreements--It is the portfolios' policy that all
repurchase agreements are fully collateralized by U.S. Treasury
and Government agency securities. All collateral is held by the
Trust's custodian bank, sub-custodian or a bank with which the
custodian bank has entered into a sub-custodian agreement or is
segregated in the Federal Reserve Book Entry System. In connection
with transactions in repurchase agreements, if the seller defaults
and the value of the collateral declines, or if the seller enters
into an insolvency proceeding, realization of the collateral by
the Trust may be delayed or limited.
D. Foreign Currency Translations--The books and records of the
Portfolios are maintained in U.S. dollars. Foreign currency
amounts are translated into U.S. dollars at the official exchange
rates, or at the mean of the current bid and asked prices of such
currencies against the U.S. dollar last quoted by a major bank on
the following basis:
(1) Market value of investment securities, other assets and
liabilities: at the closing rate of exchange at the balance
sheet date.
(2) Purchases and sales of investment securities and income and
expenses: at the rates of exchange prevailing on the
respective dates of such transactions.
Reported realized foreign exchange gains or losses arise
from disposition of foreign currency, currency gains or
losses realized between the trade and settlement dates on
securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding
taxes recorded on the portfolios' books on the transaction
date and the U.S. dollar equivalent of the amounts actually
received or paid. Unrealized foreign exchange gains and
losses arise from changes (due to the changes in the
exchange rate) in the value of foreign currency and other
assets and liabilities denominated in foreign currencies
which are held at period end.
E. Forward Foreign Currency Exchange Contracts--A forward currency
contract is an obligation to purchase or sell a specific currency
for an agreed price at a future date. Each day the forward contract
is open, changes in the value of the contract are recognized as
unrealized gains or losses by "marking to market." When the forward
contract is closed, or the delivery of the currency is made or
taken, the portfolio records a realized gain or loss equal to the
difference between the proceeds from (or cost of) the closing
transaction and the portfolio's basis in the contract. The
portfolios are subject to off balance sheet risk to the extent of
the value of the contract for purchases of currency and in an
unlimited amount for sales of currency.
<PAGE>
page 21
NOTES TO FINANCIAL STATEMENTS (Unaudited) [logo]
F. Federal Income Tax Status--It is the Trust's policy to comply
individually for each portfolio with the requirements of the
Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
G. Dividends and Distributions to Shareholders--The portfolios record
dividends and distributions to its shareholders on the record date.
The amount of dividends and distributions from net investment
income and net realized capital gains are determined in accordance
with federal income tax regulations which may differ from generally
accepted accounting principles. These differences are either
considered temporary or permanent in nature. To the extent these
differences are permanent in nature, such amounts are reclassified
within the capital accounts based on their federal tax-basis
treatment. The difference arises due to different book and tax
treatments for net realized gains (losses) on foreign currency
transactions. Dividends and distributions which exceed net
investment income and net realized capital gains for financial
reporting purposes but not for tax purposes are reported as
dividends in excess of net investment income or distributions in
excess of net realized capital gains. To the extent they exceed net
investment income and net realized capital gains for tax purposes,
they are reported as distributions of paid-in-capital.
H. Expenses--Direct expenses of a portfolio are charged to the
respective Portfolio and general Trust expenses are allocated on
the basis of relative net assets or on another reasonable basis.
2. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
A. Investment Advisory Fees--The Chase Manhattan Bank, N.A.
("Chase"), a direct wholly-owned subsidiary of the Chase Manhattan
Corporation, is the Portfolios' investment adviser (the "Adviser")
and custodian (the "Custodian"). The Adviser manages the assets of
the portfolios pursuant to an Advisory Agreement and, for such
services, is paid an annual fee computed daily and paid monthly
based on an annual rate equal to 0.80% of the International Equity
Portfolio's, 0.60% of the Capital Growth and Growth and Income
Portfolios', 0.55% of the Asset Allocation Portfolio's, 0.50% of
the Treasury Income Portfolio's and 0.25% of the Money Market
Portfolio's average daily net assets. The Adviser voluntarily
waived all its fees.
B. Administration Fee--Pursuant to an Administration Agreement, Chase
(the "Administrator") provides certain administration services to
the portfolios. For these services, the Administrator receives from
each Portfolio a fee computed at an annual rate equal to 0.05% of
the respective portfolio's average daily net assets. The
Administrator voluntarily waived all of its fees.
C. Sub-Administration Fees--Pursuant to a Sub-administration
Agreement, Vista Fund Distributors, Inc. ("VFD" or the
"Sub-administrator"), an indirect wholly-owned subsidiary of BISYS
Group Inc., provides certain sub-administration services to the
Portfolios, including providing officers, clerical staff and office
space for an annual fee of 0.15% of the average daily net assets of
each portfolio. The Sub-administrator voluntarily waived all of
its fees.
D. Waivers of Fees--For the six months period ended February 29,
1996, the Administrator, Advisor and Sub-administrator voluntarily
waived fees and the Sub-administrator assumed expenses for the
portfolios as follows:
<TABLE>
<CAPTION>
U.S.
Growth Capital Intl. Asset Treasury Money
& Income Growth Equity Allocation Income Market
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
-------- -------- -------- -------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Administration $ 1,405 $ 1,496 $ 1,120 $ 1,165 $ 1,119 $1,070
Advisory 16,860 17,952 17,928 12,817 11,186 5,348
Sub-administration 4,215 4,488 3,362 3,496 3,356 3,209
------ ------ ------ ------ ------ --------
TOTAL WAIVERS $22,480 $23,936 $22,410 $17,478 $15,661 $9,627
------ ------ ------ ------ ------ --------
</TABLE>
The Sub-administrator voluntarily assumed certain expenses of the
funds:
<TABLE>
<CAPTION>
<S> <C>
Growth and Income Portfolio $ 6,985
Capital Growth Portfolio 2,951
International Equity Portfolio 39,555
Asset Allocation Portfolio 14,689
U.S. Treasury Income Portfolio 3,297
Money Market Portfolio 17,945
</TABLE>
<PAGE>
page 22
[logo] NOTES TO FINANCIAL STATEMENTS (Unaudited)
E. Other--Chase provides portfolio custody and fund accounting
services for all of the portfolios, with the exception of the IEP
for which it provides only the custody services. Compensation for
such services from Chase are presented in the Statement of
Operations as Custodian fees.
During the year ended August 31, 1995, the Trust adopted an
unfunded non-contributory defined benefit pension plan covering all
independent directors of the Trust who have served as an
independent director of the Trust or any of the other Vista funds
for at least five years at the time of retirement. Benefits under
this plan are based on compensation and years of service.
Management has determined that the accrual for prior service costs
is not material.
In August 1995, Chemical Banking Corporation ("Chemical") and The
Chase Manhattan Corporation announced that they had entered into a
merger agreement which occurred on March 31, 1996. The subsequent
merger of The Chase Manhattan Bank, N.A. with and into Chemical
Bank is expected to occur prior to December 1996, at which time
Chemical Bank will assume the Chase Manhattan name.
3. INVESTMENT TRANSACTIONS Purchases and sales of investments (excluding
short-term investments) were as follows:
<TABLE>
<CAPTION>
U.S.
Growth Capital Intl. Asset Treasury
& Income Growth Equity Allocation Income
Portfolio Portfolio Portfolio Portfolio Portfolio
--------- --------- --------- -------- -----------
<S> <C> <C> <C> <C> <C>
SECURITIES TRANSACTIONS:
Purchases (Excluding
U.S. Government) $1,048,196 $2,766,465 $3,037,996 $ 628,814 --
Sales (Excluding
U.S. Government) 3,246,532 5,056,029 5,995,169 1,856,113 --
Purchases of U.S. Govt. -- -- -- 597,503 $2,297,281
Sales of U.S. Govt. -- -- -- 1,295,559 4,734,484
</TABLE>
4. FEDERAL INCOME TAX MATTERS For Federal income tax purposes, the cost and
unrealized appreciation/ (depreciation) in value of the investment
securities at February 29, 1996 are as follows:
<TABLE>
<CAPTION>
U.S.
Growth Capital Intl. Asset Treasury Money
& Income Growth Equity Allocation Income Market
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
--------- --------- --------- --------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Aggregate cost $3,871,957 $4,284,981 $2,436,180 $2,714,154 $2,592,868 $2,396,842
--------- --------- --------- --------- --------- -----------
Gross unrealized
appreciation $ 712,457 $ 677,365 $ 215,371 $ 369,526 $ 70,325 --
Gross unrealized
depreciation (57,154) (56,652) (35,851) (32,683) (4,390) --
--------- --------- --------- --------- --------- -----------
Net unrealized
appreciation/
(depreciation) $ 655,303 $ 620,713 $ 179,520 $ 336,843 $ 65,935 --
========= ========= ========= ========= ========= ===========
</TABLE>
<PAGE>
page 23
NOTES TO FINANCIAL STATEMENTS (Unaudited) [logo]
5. TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST Transactions in shares of
beneficial interest for the periods presented were as follows:
<TABLE>
<CAPTION>
Growth Capital Intl.
& Income Growth Equity
Portfolio Portfolio Portfolio
--------------- --------------- -----------------
09/01/95 03/01/95* 09/01/95 03/01/95* 09/01/95 03/01/95*
through through through through through through
02/29/96 08/31/95 02/29/96 08/31/95 02/29/96 08/31/95
------ ----- ------ ----- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Shares sold 65,542 544,409 83,725 531,860 14,517 503,579
Shares issued in re-
investment of distributions 15,050 -- 10,004 -- 12,206 --
Shares redeemed (249,828) (130) (243,490) (105) (275,382) (20)
------ ----- ------ ----- ------ -------
Net increase (decrease)
in Trust shares outstanding (169,236) 544,279 (149,761) 531,755 (248,659) 503,559
------ ----- ------ ----- ------ -------
Outstanding shares at:
Beginning of period 544,279 -- 531,755 -- 503,559 --
------ ----- ------ ----- ------ -------
End of period 375,043 544,279 381,994 531,755 254,900 503,559
====== ===== ====== ===== ====== =======
</TABLE>
<TABLE>
<CAPTION>
Asset U.S. Treasury
Allocation Income Money Market
Portfolio Portfolio Portfolio
--------------- --------------- -----------------
09/01/95 03/01/95* 09/01/95 03/01/95* 09/01/95 03/01/95*
through through through through through through
02/29/96 08/31/95 02/29/96 08/31/95 02/29/96 08/31/95
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Shares sold 17,315 502,546 7,014 504,106 334,753 5,295,101
Shares issued in re-
investment of distributions 23,832 -- 35,888 -- 112,287 141,356
Shares redeemed (260,716) (8) (269,469) (73) (3,438,839) (14,246)
-------- -- -------- --- ---------- -------
Net increase (decrease)
in Trust shares outstanding (219,569) 502,538 (226,567) 504,033 (2,991,799) 5,422,211
-------- ------- -------- ------- ---------- ---------
Outstanding shares at:
Beginning of period 502,538 -- 504,033 -- 5,422,211 --
------- ------- ------- ------- --------- ---------
End of period 282,969 502,538 277,466 504,033 2,430,412 5,422,211
======= ======= ======= ======= ========= =========
</TABLE>
* Commencement of operations.
6. OPEN FORWARD FOREIGN CURRENCY CONTRACTS The following forward foreign
currency contracts were held by the International Equity Portfolio at
February 29, 1996:
<TABLE>
<CAPTION>
Net
Delivery Unrealized
Value Market Gain
(Local Cost Settlement Value (Loss)
Currency (USD) Date USD USD
--------- ------- -------- ------- ----------
<S> <C> <C> <C> <C> <C>
PURCHASES
DEM 150,000 $102,302 04/17/96 $102,380 $ 78
DEM 165,000 114,335 04/17/96 112,618 (1,717)
JPY 16,000,000 153,440 03/22/96 152,712 (728)
----- -----
$370,077 $367,710
----- -----
Sales
DEM 315,000 $219,925 04/17/96 $214,998 $ 4,927
DEM 55,000 37,613 05/15/96 37,595 18
JPY 16,000,000 158,290 03/22/96 152,712 5,578
JPY 5,000,000 48,538 04/17/96 47,896 642
----- -----
$464,366 $453,201
----- -----
</TABLE>
DEM -- German Deutschemark
JPY -- Japanese Yen
USD -- United States Dollar
<PAGE>
(C)The Chase Manhattan Bank, 1996 Vista Investment Services
VCA-3 496
