THE HUDSON RIVER TRUST
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Annual Report
December 31, 1995
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MARKET CONDITIONS
1995 was a banner year for the U.S. financial markets. The Dow Jones Industrial
Average rose above 5,000, while the S&P 500 index advanced by more than 37%.
The bond market was stimulated by a near 2% drop in long-term rates and the
Lehman Aggregate Bond Index, a broad based bond market index posted over an 18%
return.
The rally in the bond market was prompted by last year's tightening by the
Federal Reserve, which slowed economic growth while keeping inflation low. At
the start of the year, inflation was in the 4%-4.5% range and market watchers
anticipated that it would fall to 3.5% by year-end. Instead, we are moving
toward 1996 with inflation at a relatively stable 2.5% level.
This shift caused the 30-year bond yield to drop from approximately 8% to 6%
during 1995- a significant drop for a 12-month period. The combination of a
benign inflation outlook and lower interest rates led to excellent performance
in all sectors of the fixed-income market.
In 1995, the bond market was also encouraged by the increasing prospects of
decreasing or even eliminating the Federal budget deficit. Although the budget
debate continues, an agreement is expected and would be extremely important as a
step toward substantial progress in cutting the budget, even if more ambitious
Republican plans are not met.
Falling interest rates, low inflation and good corporate earnings created a
near-ideal environment for stocks in 1995. The strongest areas of the stock
market were technology, which benefited from very rapid industry growth;
financial services, which benefited from the drop in rates; and health care,
which benefited from the failure of reform legislation.
The surprise in the stock market this year was that, in a market environment
with little power to raise prices and tepid sales growth, corporations continued
to expand margins and record good profits. The excellent performance of the S&P
500 was driven by larger capitalization, blue chip stocks; which advanced well
ahead of the general market. Indices like the Russell 2000, which represent
smaller capitalization stocks, also posted strong performance, but were unable
to keep pace with the S&P 500.
Foreign stock markets, which outperformed the U.S. market throughout 1994, could
not keep pace with the U.S. rally in 1995. The European markets came closest -
the MSCI European Index was up more than 20% for 1995, with 8% in currency gains
against the U.S. dollar. The Japanese equity market was up only 0.7% in 1995,
pulled down by a weak yen, while developing markets were down 7% for the year.
Looking forward, we expect that U.S economic growth will remain modest. As we
enter 1996, wrangling over the budget has caused interest rates to rise and, in
the near term, the bond market should remain in a wider trading range until
there is a resolution. Market participants are frustrated given the lack of
economic data, but there seems to be little risk of excessive economic growth.
With few inflationary pressures on the horizon, we expect the Federal Reserve to
cut interest rates further in order to stimulate consumer expenditures and
investment. If our forecast proves correct, the result should be further gains
in U.S. bond prices.
It will be difficult for U.S. companies to maintain the strong level of profit
growth seen in 1995 with nominal GDP growth (real growth plus inflation) below
5%. We suspect that the stock market will hit weakness at some point during the
year as more realistic profit forecasts are built into stock prices and that
1996 will see foreign markets begin to catch up with the U.S. However, we
believe that 1996 should bring moderate growth in both the economy and the stock
market, albeit at rates much more modest than in 1995.
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THE EQUITY SERIES:
GROWTH & INCOME PORTFOLIO
Paul Rissman
Vice President
Investment experience:
7 years
W. Theodore Kuck
Vice President
Investment experience:
22 years
The stock market reached new highs in 1995, with the S&P 500 up more than 37%
for the year. The market benefited from the almost 2% drop in long-term
interest rates, which caused price/earnings ratios to rise. Substantial
improvements in efficiency throughout the year helped companies to increase
profits even as sales growth declined.
The Growth & Income Portfolio posted a gain of more than 24% for 1995.
Although a strong return in absolute terms, this was well below the performance
of the S&P 500. The Portfolio's conservative focus on blue chip, high dividend
paying equity holdings prevented us from fully participating in the market
rally. The Portfolio also underperformed its unmanaged benchmark, comprised of
75% S&P 500 and 25% Value Line Convertible Index. In strong markets such as
the one we experienced in 1995, higher-yielding stocks and convertible bonds
can not keep pace with the averages.
However, we continue to believe that convertible bonds make excellent
investments over the long term. In purchasing a convertible bond, one gives up
some price appreciation in the future in exchange for a higher dividend. When
the equity market is very strong, potential for price appreciation is given up
very quickly, and it takes time for this to be offset by the extra income from
higher dividends. In a flat to declining market, convertible bonds are
excellent performers because of their interest payments. We have increased our
positions in the credit sensitive and energy sectors, where earnings are
relatively independent of the economic cycle.
Looking forward, we believe it will be very difficult for U.S. companies to
maintain profit growth in 1996. Nominal GDP growth (real growth plus
inflation) is below 5%. Maintaining profit growth in this environment could
result in layoffs, which in turn could lead to even slower growth in consumer
spending. We suspect that the market will hit weakness at some point in 1996
as more realistic profit forecasts are built into stock prices.
INVESTMENT OBJECTIVE
High total return through a combination of current income and capital
appreciation
INVESTMENT POLICY
Primarily income-producing common stocks and securities convertible into common
stocks
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $98.1 million
Number of Issues 85
ASSET MIX DISTRIBUTION
Short-Term & Cash 23.2%
Convertibles 16.5%
Preferred Stock 5.6%
Common Stock 54.7%
LARGEST HOLDINGS
Bank of New York Co.*
This large New York-based commercial bank has expanded regionally
by acquiring local and suburban banks and is a growing presence in retail-
oriented banking.
Philip Morris Cos., Inc.
The largest cigarette company in the U.S. (Marlboro), second-largest
brewer (Miller Brewing Co.) and largest U.S. food processor (Kraft
General Foods, Inc.)
Mobil Corp.
A worldwide integrated petroleum company and leading maker of chemicals with an
aggressive exploration program to develop frontier
oil fields.
NYNEX Corp.
Operates the fifth largest local exchange telephone business in the U.S.,
serving the majority of customers in New York State and the New England states.
Bristol-Myers Squibb Co.
Major pharmaceutical and consumer goods manufacturer. Products include
pharmaceutical, beauty aids and infant formula, marketed under the Clairol,
Nuprin, Ban and Bufferin brand names.
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Cincinnati Bell, Inc.
Provides telephone service in southwestern Ohio and parts of Kentucky and
Indiana. It also engages in unregulated telecommunications
related businesses.
*Includes convertibles
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THE EQUITY SERIES:
EQUITY INDEX PORTFOLIO
Judith Maglio
Vice President
Investment experience:
25 years
The rally of the equity market in 1995 resulted in strong performance for the
S&P 500, and consequently for the Equity Index Portfolio. In 1995, the Equity
Index Portfolio (after expenses) posted returns closely in line with those of
the S&P 500.
The Equity Index Fund is the only passively managed portfolio within the Hudson
River Trust. Using a stratified sampling technique, the Portfolio is
constructed to track the investment results of the S&P 500 Index before
expenses without holding all 500 issues. It also seeks to keep its risk level
consistent with that of the S&P 500. Because the goal of the Index is to track
the S&P 500, it will remain fully invested in common stocks.
As of December 31, the Portfolio held 454 of the 500 issues in the S&P 500
Index. Stocks are selected to mirror the market capitalization and industry
weightings of the S&P 500.
INVESTMENT OBJECTIVE
Total return before expenses that approximates the total return performance of
the Standard & Poor's Corporation 500 Index, including reinvestment of
dividends, at a risk level consistent with that of the Index.
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $165.8 million
Number of Issues 454
LARGEST HOLDINGS
General Electric Co.
GE's business products include aircraft engines, appliances and
broadcasting, lighting and financial services.
AT&T Corp.
The largest U.S. long-distance telephone company. It also manufactures
telecommunications equipment and computers and provides financial services.
Exxon Corp.
A major world crude oil and natural gas exploration, production, transportation
and marketing company. It also explores for and mines coal and other minerals,
and makes and sells petrochemicals.
Coca-Cola Co.
The world's largest soft-drink company - it makes soft drink
concentrates and syrups - and has a sizable fruit juice business -
especially orange juice.
Merck & Co., Inc.
The largest pharmaceutical company in the world. Entered the
managed care market through acquisition of Medco Containment Systems, the
leading mail-order drug marketer in the United States.
Philip Morris Cos., Inc.
The largest cigarette company in the U.S. (Marlboro), second-largest brewer
(Miller Brewing Co.) and largest U.S. food processor (Kraft General Foods,
Inc.).
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THE EQUITY SERIES:
COMMON STOCK PORTFOLIO
Tyler Smith
Senior Vice President
Investment experience:
32 years
1995 was one of the best years ever for the U.S. stock market. It was the
Federal Reserve's tightening of monetary policy in 1994 that kept inflation in
check and allowed for an easing of interest rates in 1995. Combined with good
corporate earnings, this created a near-ideal environment for stocks.
As the year progressed, it became more and more apparent that the pace of
economic growth was slowing. This resulted in a narrowing of market
leadership, with blue chip consumer stocks, considered to be relatively
insulated from the economic cycle, advancing well ahead of the general market.
As these stocks are heavily represented in the stock market averages, funds
which typically invest in a broader mix of companies had a difficult time
matching the performance of the Dow Jones and Standards and Poors averages.
The Common Stock Portfolio did well through the summer months, but lagged later
in the year as its large technology holdings came under selling pressure. We
have shifted emphasis within this sector away from personal computer related
stocks and toward computer networking companies, which are profiting from the
extraordinary growth of the Internet. We think that the market's selling of
these stocks will run its course and that they will do well in 1996. The
Portfolio also continues to stress financial stocks.
Clearly, 1995 market performance was well above trends and is unlikely to be
matched in 1996. With interest rates low and inflation under control, we do
not see significant downside risk. The economic expansion hasn't produced
excesses that require a recession to correct. 1996 should bring moderate
growth in both the economy and the stock market, albeit at rates much more
modest than in 1995.
INVESTMENT OBJECTIVE
Long-term growth of its capital and increase income
INVESTMENT POLICY
Primarily common stock and other equity-type
instruments
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $4.9 billion
Number of Issues 102
ASSET MIX DISTRIBUTION
Preferred Stock 0.9%
Convertibles 0.5%
Short-Term and Cash 2.6%
Common Stock 96.0%
LARGEST HOLDINGS
Cisco Systems, Inc.
Leading provider of equipment and systems used to interconnect and manage
computer networks.
American International Group, Inc.
One of the world's leading insurance organizations providing insurance and
other financial services in 130 countries and territories.
Travelers Group, Inc.
This company offers diverse financial services, including investment
services, insurance and consumer lending.
Mannesmann AG (ADR)
Manufactures steel tubes, machinery and auto components and engages in
industrial plant engineering. Mannesmann also operates Germany's second private
mobile phone network.
Loews Corp.
A widely diversified conglomerate deriving most of its revenue from life and
property-casualty insurance and cigarettes through its holdings CNA Insurance
and Lorillard tobacco.
Motorola, Inc.
One of the leading suppliers of semiconductors, paging equipment and cellular
mobile telecommunications systems. Also produces government and industrial
electronics and automotive equipment.
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THE EQUITY SERIES:
GLOBAL PORTFOLIO
Ronald Simcoe
Vice President
Investment experience:
18 years
The U.S. equity market had an exceptional 1995 compared to international
markets, with the S&P 500 Index rising more than 37%. During the year, the
European markets gained 21.5%, of which 8% represented currency gains. Japan
was up 0.7% despite Yen weakness, which reduced performance by 4%. Developing
markets lagged, falling 7% for the year. The Global Portfolio slightly
underperformed the Morgan Stanley Capital World Index, primarily because of the
Portfolio's modest underweighting of the strong U.S. market.
Currency volatility was a major factor in global performance for 1995 as the
U.S. dollar experienced a roller coaster ride, particularly against the Yen.
From January to April, the dollar weakened dramatically, which reduced earnings
for most non-dollar based companies. Because of dollar weakness, the goods and
services of non-dollar based companies became more expensive in the competitive
global marketplace. Strengthening of the dollar occurred as the year
progressed, following settlement of the U.S./Japan trade dispute and
intervention by major central banks (particularly the U.S. and Japan).
For the year, growth stocks performed exceptionally well due to continuous
interest rate reductions which began at the end of the first quarter. The
central banks of developed countries have all adopted monetary policies
designed to turn around the decelerating growth rates of their economies.
As we enter 1996, we expect ongoing global interest rate reductions. We will
also see better sales and earnings comparisons for European and Japanese
manufacturers against dollar-based competitors. Japan offers the greatest
potential for positive earnings surprises in the new year. Year-end valuation
measures indicate that the U.S. stock market is expensive relative to
international markets; growth stocks are expensive; and cyclical stocks appear
attractive. We are modestly rebalancing the Portfolio by selling highly-valued
growth companies and replacing them with quasi-cyclical stocks.
INVESTMENT OBJECTIVE
Long-term growth of capital
INVESTMENT POLICY
Primarily equity securities of non-United States companies as well as United
States issuers
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $686.1 million
Number of Issues 392
Number of Countries Represented 33
DISTRIBUTION OF EQUITY INVESTMENTS BY GLOBAL REGION
Other European Countries 13.8%
Canada 0.8%
New Zealand & Australia 1.6%
Short-Term & Cash 13.5%
Scandinavia 3.3%
Japan 20.0%
Southeast Asia 3.4%
Latin America 1.0%
United Kingdom 8.2%
United States 34.4%
LARGEST EQUITY HOLDINGS
Cisco Systems, Inc.
Leading provider of equipment and systems used to interconnect and manage
computer networks.
Travelers Group, Inc.
This company offers diverse financial services, including investment services,
insurance and consumer lending.
SGL Carbon AG
German producer of carbon electrodes for electric steel furnaces.
Filtronic Comtek PLC
Major British producer of cellular telephone infrastructure
components.
American International Group, Inc.
One of the world's leading insurance organizations providing insurance and
other financial services in 130 countries and
territories.
Philip Morris Cos., Inc.
The largest cigarette company in the U.S. (Marlboro), second-largest
brewer (Miller Brewing Co.) and largest U.S. food processor (Kraft
General Foods, Inc.)
Please refer to the prospectus for a description of the risks involved in
international investing, including currency, economic and political risks, as
well as differences in accounting.
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THE EQUITY SERIES:
INTERNATIONAL PORTFOLIO
Ronald Simcoe
Vice President
Investment experience:
18 years
The International Portfolio, established on April 3, 1995, posted double-digit
returns through the end of 1995, outperforming its unmanaged benchmark, the
MSCI EAFE Index. The International Portfolio has grown rapidly from a base of
$5 million to $28.7 million at year-end.
The Portfolio's strong performance was driven by ownership of growth stocks,
which experienced strong gains in a falling interest rate environment. Our
overweight positions in capital goods and technology stocks also helped
performance. Beginning in the second quarter of 1995, we benefited from
currency hedges against the Japanese Yen.
As we enter 1996, we expect continued global interest rate declines and we
believe foreign markets will perform well relative to the U.S. We should see
better sales and earnings comparisons for European and Japanese manufacturers
against their dollar-based competitors. Year-end historic valuation measures
indicate that the U.S. stock market is expensive relative to international
markets; growth stocks are expensive; and cyclical stocks appear attractive.
The Portfolio experienced a large surge in cash inflow at the end of 1995.
This cash will be expeditiously invested in January 1996. We plan to add to
our holdings in both Japan and the U.K., which are the largest international
markets. Quasi-cyclical issues are expected to be the major investment theme.
We also plan to rebuild significant hedges on European currencies since we
believe the dollar will strengthen further in early 1996.
INVESTMENT OBJECTIVE
Long-term growth of capital
INVESTMENT POLICY
Primarily equity securities selected principally to permit
participation in non-United States companies with prospects for growth.
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $28.7 million
Number of Issues 222
Number of Countries Represented 30
DISTRIBUTION OF EQUITY INVESTMENTS BY GLOBAL REGION
New Zealand & Australia 2.9%
Canada 0.7%
Japan 31.0%
Short-Term & Cash 37.6%
United Kingdom 6.1%
Scandinavia 4.0%
Southeast Asia 2.9%
Other European Countries 13.6%
Latin America 1.2%
LARGEST EQUITY HOLDINGS
SGL Carbon AG
German producer of carbon electrodes for electric steel furnaces.
Rohm Co. Ltd.
Japanese producer of specialized semi-conductor devices,
particularly known for customized linear integrated circuits.
Nichei Co. Ltd.
Japanese financial company which lends primarily to medium
and small domestic corporations.
Aegon N.V.
Major Dutch property and casualty insurance company with
significant U.S. share in Japan.
Nippon Television Network
Nationwide television broadcaster holding top-ranked audience share in Japan.
Cochlear Ltd.
Australian specialist manufacturer of hearing aids for people
with severe hearing disabilities.
Please refer to the prospectus for a description of the risks involved in
international investing, including currency, economic and political risks, as
well as differences in accounting.
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THE EQUITY SERIES:
AGGRESSIVE STOCK PORTFOLIO
Alden Stewart
Executive Vice President
Investment experience:
24 years
Randall Haase
Senior Vice President
Investment experience:
8 years
The U.S. equity markets saw a historic rally in 1995, with the Standard & Poors
and Dow Jones averages rising to record highs. The blue-chip consumer stocks
that drive the S&P 500 advanced well ahead of the general market. However,
indices like the Russell 2000, which represents smaller capitalization stocks,
were unable to keep pace with the S&P 500. The Aggressive Stock Portfolio
posted strong returns in 1995, outperforming its unmanaged market benchmark,
comprised of 50% S&P 400 (Mid-Cap) Index and 50% Russell 2000 Index.
Our overweight position in energy services, and particularly offshore drilling,
helped boost Portfolio performance. Having significantly reduced technology
holdings during the fall, the Portfolio avoided the repercussions of the market
sell-off in technology stocks in the fourth quarter.
As we enter 1996, we continue to favor energy, health care, retail and
technology stocks. Reflecting these themes, newer positions in the Portfolio
include Diamond Offshore Drilling, the largest owner of semi-submersible
offshore rigs. We have also added a position in Healthsouth, the country's
largest provider of inpatient and outpatient rehabilitation. We eliminated our
large position in Viacom during the summer due to slowdowns in both the video
industry and Viacom's theatrical division.
We believe interest rates should remain flat as long as moderate economic
activity continues. It is likely that the Federal Reserve will lower the
federal funds rate again sometime in the next few months to prevent the economy
from slowing further. We remain focused on small to medium-sized growth
companies that continue to build their franchises and have the potential to
expand market share in their respective industries.
INVESTMENT OBJECTIVE
Long-term growth of capital
INVESTMENT POLICY
Primarily common stocks and other equity-type securities issued by quality
small- and intermediate-sized companies with strong growth prospects and in
covered options on those securities
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $2.7 billion
Number of Issues 76
ASSET MIX DISTRIBUTION
Short-Term and Cash 4.6%
Common Stock 95.4%
LARGEST HOLDINGS
CNAFinancial Corp.
One of the largest property-casualty and life insurers in the United States.
Telephone & Data Systems, Inc.
Owns and operates local phone companies primarily in rural areas and is a
leading owner and operator of cellular telephone systems through its majority
ownership of U.S. Cellular.
Federated Department Stores, Inc.
One of the largest department store operators with 355 stores and over $15
billion in sales.
Nine West Group, Inc.
One of the leading manufacturers of women's footwear in the United States. The
company sells their products through department stores as well as their own
retail stores.
Mannesmann AG (ADR)
Manufactures steel tubes, machinery and auto components and engages in
industrial plant engineering. Mannesmann also operates Germany's second private
mobile phone network.
Diamond Offshore Drilling
One of the largest operators of semi-submersible offshore drilling rigs in the
world.
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THE ASSET ALLOCATION SERIES:
CONSERVATIVE INVESTORS PORTFOLIO
Robert G. Heisterberg
Senior Vice President
Investment experience:
35 years
Both the equity and fixed-income markets saw significant rallies in 1995. The
S&P 500 index rose more than 37% in 1995, while long-term interest rates
dropped by nearly 2%. With this sharp drop in interest rates, the Conservative
Investors Portfolio easily recovered last year's decline and went on to post a
strong double-digit return. The Portfolio underperformed its unmanaged
benchmark, which represents 70% Lehman Brothers Treasury Bond Index and 30%
S&P 500; mostly due to a conservative asset mix, with only 12% invested in
stocks. However, with returns of more than 20% for the year, the Portfolio
posted strong performance in absolute terms while maintaining a low risk
profile.
Performance in the fixed-income portion of the Portfolio was above benchmark,
largely due to a longer-than-average maturity and the drop in long-term
interest rates. The performance of the Portfolio's equity holdings was fairly
close to that of the S&P 500 due to our emphasis on consumer non-cyclical and
financial stocks. These sectors were not hurt by slower-than-expected economic
growth.
Our asset mix remains conservative, with 78% of the Portfolio invested in
fixed-income investments, 12% in stocks and 10% in cash. The stock market is
at record highs on many value measures and we do not believe that a
conservative investor should have substantial exposure to stocks at these
levels. On the fixed-income side, we are maintaining an average maturity of
12.5 years, which is slightly longer than benchmark, because of the
disappointing Christmas selling season.
We suspect that the economy will be off to a weak start in 1996 and that bond
prices will be firm. Portfolio quality remains very high, so that any credit
quality concerns created by the economic slowdown should not affect the
Portfolio's performance.
INVESTMENT OBJECTIVE
High total return without, in the investment adviser's
opinion, undue risk to principal
INVESTMENT POLICY
Diversified mix of publicly traded equity and debt securities
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $252.1 million
Number of Issues 46
Average Quality* AA+
ASSET MIX DISTRIBUTION
Common Stock 11.6%
Short-Term and Cash 10.4%
Bonds 78.0%
LARGEST EQUITY HOLDINGS
Bank of New York Co.
This large New York-based commercial bank has expanded regionally
by acquiring local and suburban banks and is a growing presence in
retail-oriented banking.
Philip Morris Cos., Inc.
The largest cigarette company in the U.S. (Marlboro), second-largest
brewer (Miller Brewing Co.) and largest U.S. food processor (Kraft
General Foods, Inc.)
General Electric Co.
GE's business products include aircraft engines, appliances and
broadcasting, lighting and financial services.
Medtronic, Inc.
The world's leading producer of implantable cardiac pacemakers, this company
also makes related support systems, artificial heart valves and neurological
devices and has one of the world's largest medical device sales forces.
Gillette Corp.
The leading company in razors and blades with over 60% of the domestic market,
along with important market positions in toiletries, writing instruments and
small appliances.
Pfizer, Inc.
Major multinational pharmaceutical company. Markets products under
the Visine, Ben-Gay and Procardia brand names.
We vary the portion of assets invested in each type of security in accordance
with our evaluation of economic conditions, the general level of common stock
prices, anticipated interest rates and other relevant considerations.
*The Average Quality represents a weighted average of the Portfolio's fixed
income holdings, excluding cash, using the Standard & Poor's rating scale.
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THE ASSET ALLOCATION SERIES:
BALANCED PORTFOLIO
Robert G. Heisterberg
Senior Vice President
Investment experience:
35 years
The economic environment of slow growth, subdued inflation and declining
interest rates provided the backdrop for an excellent year in the financial
markets. The stock market was propelled by strong corporate profits and a
sharp drop in interest rates. In addition, strong cash flow into U.S. equity
mutual funds continued. In 1995, the S&P 500 gained more than 37%, led by the
performance of large capitalization stocks. The bond market also racked up
double-digit returns, but was unable to match the equity market. As expected,
this generally caused balanced funds to underperform pure equity funds in 1995.
During the first two months of 1995, conservative corporate positioning and a
shift in Federal Reserve monetary policy detracted from the performance of the
Portfolio's bond component, although it went on to outperform the market during
the rest of 1995. We are maintaining a longer-than-average duration versus the
Lehman Government/Corporate Index in response to the continued slow growth of
the economy.
The equity component of the Balanced Portfolio emphasizes growth at a
reasonable price across the capitalization spectrum. The excellent performance
of the S&P 500 was driven by larger capitalization, blue chip stocks; which
advanced well ahead of the general market. Indices representing smaller
capitalization stocks also posted strong performance, but were unable to keep
pace with the S&P 500. The Balanced Portfolio holds high quality, leading
companies and is broadly diversified across industry lines. We continue to
focus on the stocks of those companies, in any industry, whose earnings growth
is reliable, steady and much faster than that of the stock market in general.
The Portfolio's asset mix as of year-end was 55.1% in stocks and convertible
securities, 37.8% in bonds and 7.1% in cash. We believe the Portfolio's stock
holdings have the potential for strong earnings improvements in 1996.
However, there are risks in the stock market if the U.S. economy strays from
its non-inflationary growth path. Given our forecast for the economy and
financial markets, we do not anticipate any major shifts in the asset mix in
the near future.
INVESTMENT OBJECTIVE
High return through both appreciation of capital and
current income
INVESTMENT POLICY
Diversified portfolio of publicly traded equity and debt securities and short-
term money market instruments
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $1.5 billion
Number of Equity Issues 156
Average Quality* AA
Average Maturity 9.2 years
ASSET MIX DISTRIBUTION
Short-Term and Cash 7.1%
Bonds 37.8%
Convertibles 3.0%
Preferred Stock 1.0%
Common Stock 51.1%
Please refer to the prospectus for a description of the risks involved in
international investing, including currency, economic and political risks, as
well as differences in accounting.
LARGEST EQUITY HOLDINGS
Philip Morris Cos., Inc.**
The largest cigarette company in the U.S. (Marlboro), second-largest
brewer (Miller Brewing Co.) and largest U.S. food processor (Kraft
General Foods, Inc.)
Travelers Group, Inc.
This company offers diverse financial services, including investment
services, insurance and consumer lending.
Monsanto Co.
Diversified chemical company with significant exposure in the
agricultural and pharmaceutical businesses.
Pepsico, Inc.
A global consumer products company in the soft drink, snack
(Frito-Lay) and restaurant businesses.
AT&T Corp.
The largest U.S. long-distance telephone company. It also manufactures
telecommunications equipment and computers and provides financial services.
Ceridian Corp.
An information services company with three main businesses: payroll processing,
systems integration and media sampling services.
We vary the portion of assets invested in each type of security in accordance
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with our evaluation of economic conditions, the general level of common stock
prices, anticipated interest rates and other relevant considerations.
* The Average Quality represents a weighted average of the Portfolio's fixed
income holdings, excluding cash, using the Standard & Poor's rating scale.
** Includes convertibles
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THE ASSET ALLOCATION SERIES:
GROWTH INVESTORS PORTFOLIO
Robert G. Heisterberg
Senior Vice President
Investment experience:
35 years
1995 was an excellent year for the financial markets - the S&P 500 index rose
more than 37%, while long-term interest rates dropped by nearly 2%. Although
the Growth Investors Portfolio underperformed its unmanaged benchmark, which
represents 70% S&P 500 and 30% Lehman Brothers Government/Corporate Bond Index,
it ended the year with strong double-digit performance. 1995 was a difficult
year for managers to keep up with benchmarks such as the S&P 500, considering
that the blue-chip companies that make up these indices significantly
outperformed the average stock. However, the Growth Investors Portfolio
outperformed its managed benchmark, the Lipper Flexible Portfolio Average, and
we believe that our rate of return is competitive with other balanced and asset
allocation funds.
The performance of the Portfolio's equity holdings was fairly close to that of
the S&P 500 due to our emphasis on consumer non-cyclical and financial stocks.
These sectors were not hurt by slower-than-expected economic growth. On the
fixed-income side, we maintained a longer than average maturity throughout the
year, which helped to boost performance. The Portfolio also benefited from the
drop in long-term interest rates and the good performance of the high-yield
sector. Foreign markets significantly lagged the U.S. market in 1995.
Although we had reduced our foreign equity holdings, our 6% exposure did weigh
down performance slightly.
We are maintaining our current asset mix, comprised of 53% in stocks, 37% in
fixed-income investments and 10% in cash. It will be difficult for U.S.
companies to maintain profit growth in 1996 and we suspect that the stock
market will hit weakness at some point during the year as more realistic profit
forecasts are built into stock prices. If profits begin to weaken, the
Portfolio's asset mix will be adjusted by selling companies with disappointing
profits. We also believe that 1996 will see foreign markets start to catch up
with the U.S. market, and have begun to gradually increase our exposure to
international stocks.
Please refer to the prospectus for a description of the risks involved in
international investing, including currency,
economic and political risks, as well as differences in accounting.
INVESTMENT OBJECTIVE
Highest total return consistent with the investment adviser's
determination of reasonable risk
INVESTMENT POLICY
Diversified mix of publicly traded equity and fixed income
securities, including at times common stocks appropriate for investment by the
Aggressive Stock Portfolio and at times fixed income securities appropriate for
the High Yield Portfolio.
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $896.1 million
Number of Issues 375
Average Quality, Investment Grade* AAA
Average Quality, High Yield* B+
ASSET MIX DISTRIBUTION
High Yield Bonds 3.9%
Short-Term and Cash 9.9%
Bonds 32.9%
Convertibles 0.1%
International Stock 6.3%
Common Stock 46.9%
LARGEST EQUITY HOLDINGS
Philip Morris Cos., Inc.
The largest cigarette company in the U.S. (Marlboro), second-largest brewer
(Miller Brewing Co.) and largest U.S. food processor (Kraft General Foods,
Inc.)
Bank of New York Co.
This large New York-based commercial bank has expanded regionally
by acquiring local and suburban banks and is a growing presence in retail-
oriented banking.
Pfizer, Inc.
Major multinational pharmaceutical company. Markets products under the Visine,
Ben-Gay and Procardia brand names.
General Reinsurance Corp.
Largest property-casualty reinsurer in the United States. Other subsidiaries
are engaged in property-casualty reinsurance overseas and in other financial
services.
Medtronic, Inc.
The world's leading producer of implantable cardiac pacemakers, this company
also makes related support systems, artificial heart valves and neurological
devices and has one of the world's largest medical device sales forces.
Gillette Corp.
The leading company in razors and blades with over 60% of the domestic market,
along with important market positions in toiletries, writing instruments and
small appliances.
We vary the portion of assets invested in each type of security in accordance
with our evaluation of economic conditions, the general level of common stock
prices, anticipated interest rates and other relevant considerations.
* The Average Quality represents a weighted average of the Portfolio's fixed
income holdings, excluding cash, using the Standard & Poor's rating scale.
A10
<PAGE>
THE FIXED INCOME SERIES:
MONEY MARKET PORTFOLIO
Raymond Papera
Vice President
Investment experience:
14 years
Fluctuating market conditions, and shifts in Federal Reserve policy, kept money
market fund managers on their toes in 1995. The Money Market Portfolio
outperformed its managed benchmark, the Lipper Money Market Mutual Funds
Average, and matched the performance of the 3-Month Treasury Bill for the year.
As 1995 opened, the Federal Reserve Board raised the Fed Funds rate to 6.00%.
It was the seventh tightening authorized by the Fed in a twelve-month period,
and we maintained a short average maturity to take advantage of any further
rate hikes. As the first quarter of 1995 came to an end, it appeared that
inflation was being held in check. Second-quarter data indicated a slowdown in
growth, which in turn caused us to shift strategy toward a more neutral stance,
and an average duration. It became clear that the short-term yield curve was
beginning to flatten out.
When the Fed announced a 25-basis-point easing in early July, it marked the
first time since 1989 that we saw a tightening and an easing in the same year.
Within the money market, as short-term interest rates began to rise above long-
term rates -- a rare situation known as an inverted yield curve -- the
Portfolio extended its average maturity to maintain competitive performance
yield.
Weak economic data continued to flow in during the third and fourth quarter,
and the lack of a federal budget agreement may have delayed additional interest
rate easings. Finally, in December, the Fed authorized another reduction in the
Funds rate, which closed the year at the 5.50% level. We responded by further
extending the Portfolio's average maturity, which was up to 58 days at the end
of 1995. According to the Fed, the December easing was based on a decline in
inflation expectations. This, combined with one of the most disappointing
holiday retail seasons since World War II, indicates that the economy will
probably remain sluggish as we enter 1996. In anticipation of further declines
in yields for now, we plan to maintain a relatively high average fund maturity.
INVESTMENT OBJECTIVE
High level of current income, preserve its assets and
maintain liquidity
INVESTMENT POLICY
Primarily high-quality U.S. dollar denominated money
market instruments
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $386.7 million
Number of Issues 50
Average Maturity 59 days
The Money Market Portfolio is neither guaranteed nor insured by the U.S.
Government. There can be no assurance that the
Portfolio will be able to maintain a stable net asset value.
ASSET MIX DISTRIBUTION
Commercial Paper 71.4%
Short-Term & Cash 1.0%
Bank Notes 3.8%
Variable Rate Securities 10.2%
Banker's Acceptances 5.1%
Certificates of Deposit 8.5%
DISTRIBUTION OF ASSETS BY MATURITY
91+ days 10.6%
61-90 days 26.7%
1-30 days 24.9%
31-60 days 37.8%
A11
<PAGE>
THE FIXED INCOME SERIES:
INTERMEDIATE GOVERNMENT SECURITIES PORTFOLIO
Patricia J. Young
Senior Vice President
Investment experience:
14 years
Paul A. Ullman
Vice President
Investment experience:
13 years
U.S. bonds provided extraordinary returns in 1995. The ground work for the
rally was laid by last year's tightening by the Federal Reserve, which slowed
economic growth to near trend levels while keeping inflation low. The
Intermediate Government Securities Portfolio posted strong returns in 1995,
slightly underperforming its unmanaged benchmark, the Lehman Intermediate
Government Bond Index.
While the U.S. economy slowed in the first half of 1995, growth improved in the
third quarter due to larger-than-expected increases in residential housing,
government spending and business inventories. However, fourth quarter economic
growth was less robust. Retail sales remained weak and gains in real
disposable income slowed while personal debt levels continued to escalate.
Growth also remained sluggish in the manufacturing sector.
A rally at year-end was sparked by the benign inflation outlook and the
possibility of a federal government deficit package. Broad price indices such
as the Consumer and Producer Price Indices rose only modestly and labor costs
remained under control.
The Portfolio's performance improved against its benchmark as 1995 progressed.
The first quarter was the most difficult period, as we started the year with a
bearish outlook for the bond market. However, we subsequently repositioned
the Portfolio to benefit from a positive market environment. The Portfolio was
invested in a combination of mortgage-backed and Treasury securities. We
varied our weighting in fixed-rate mortgages in response to the outlook for
pre-payments and the level of market volatility.
We expect that U.S. economic growth will remain modest. Wrangling over the
budget has caused interest rates to increase and, in the near term, the market
should remain in a wider trading range until there is a resolution. Market
participants are frustrated given the lack of economic data, but there seems to
be little risk of excessive economic growth. With few inflationary pressures on
the horizon, we expect the Federal Reserve to cut interest rates further in
order to stimulate consumer expenditures and investment. If our forecast
proves correct, the result should be further gains in U.S. bond prices.
INVESTMENT OBJECTIVE
High current income consistent with relative stability
of principal
INVESTMENT POLICY
Primarily debt securities issued or guaranteed as to principal and interest by
the U.S. Government or any of its agencies
or instrumentalities
The Portfolio's investments will each have a final maturity of not more than
ten years or a duration not exceeding that of a ten-year Treasury note.
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $71.8 million
Number of Issues 18
Average Quality Gov't
Average Duration* 2.6 years
*As to mortgages average life
The Intermediate Government Securities Portfolio is neither guaranteed nor
insured by the U.S. Government.
ASSET MIX DISTRIBUTION
Mortgage-Backed Securities 47.3%
CMOs 12.8%
Short-Term & Cash 8.1%
Other 4.6%
Treasuries 21.4%
Agencies 5.8%
DISTRIBUTION OF ASSETS BY DURATION*
Over 7 Years 9.1%
5-7 Years 12.3%
3-5 Years 18.0%
1-3 Years 21.5%
0-1 Year 39.1%
A12
<PAGE>
THE FIXED INCOME SERIES:
QUALITY BOND PORTFOLIO
Matthew Bloom
Vice President
Investment experience:
14 years
The fixed-income markets saw excellent performance throughout 1995. As the
year began, the economy was operating at full capacity and growing rapidly. By
the second quarter, it was apparent that the increase in interest rates in 1994
and early 1995, and declining inflationary pressures, had succeeded in slowing
growth to the more sustainable path it has since followed.
Although the Federal Reserve moved to tighten monetary policy in February by
raising the Federal Funds rate, we then saw a switch in policy as the Federal
Funds rate was reduced in July and again in December. These changes in policy
were reactions to the growth rate of the economy during 1995. As the rally in
the fixed-income markets progressed, cash levels in the Portfolio were reduced
by decreasing its exposure to long-term bonds and buying more shorter-term
bonds.
We were overweighted in the corporate bond market, attracted by enhanced yields
and the improving credit quality of corporations as the recovery continued.
Interestingly, within the corporate arena, lower-quality bonds fared better as
a whole - mostly because when the economy is positive and inflation is low,
investors don't worry as much about credit quality. This contributed to the
Quality Bond Portfolio underperforming its unmanaged benchmark, the Lehman
Aggregate Bond Index, despite the Portfolio's strong returns.
The Portfolio also invested in US dollar-denominated securities issued by non-
U.S. issuers (Yankee bonds), where credit and risk characteristics presented
opportunities. During the second half of 1995, the Portfolio took advantage of
greater returns available overseas by investing in European government bonds.
The currency risk of these investments was fully hedged back into U.S. dollars.
The Portfolio maintained an underweight position in mortgages in 1995. Fears
about volatility and a possible drop in interest rates, along with an awareness
of the increasing ease with which homeowners can refinance their mortgages, led
to concern that mortgage-backed securities would underperform.
Looking forward, we believe that the outlook remains positive for fixed-income
securities, although lower interest rates suggest that total returns in 1996
may be lower than in 1995.
INVESTMENT OBJECTIVE
High current income consistent with preservation of capital
INVESTMENT POLICY
Primarily investment grade fixed income securities
The Portfolio reserves the right to invest in convertible
debt securities, preferred stocks and dividend-paying
common stocks.
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $157.4 million
Number of Issues 18
Average Quality* AA+
Average Duration** 4.8 years
* The Average Quality represents a weighted average of the Portfolio's
holdings, excluding cash, using the Standard & Poor's rating scale.
** As to mortgages average life
Please refer to the prospectus for a description of the risks involved in
international investing, including currency,
economic and political risks, as well as differences in accounting.
ASSET MIX DISTRIBUTION
Short-Term & Cash 3.2%
Foreign Bonds 7.8%
Mortgage-Backed Securities 8.4%
Yankee Corporate Bonds 9.1%
Domestic Corporate Bonds 20.6%
Government Bonds 50.9%
DISTRIBUTION OF ASSETS BY DURATION**
7-10 Years 9.6%
4-7 Years 7.0%
2-4 Years 50.5%
Over 10 Years 14.3%
0-1 Year 3.2%
1-2 Years 15.4%
A13
<PAGE>
THE FIXED INCOME SERIES:
HIGH YIELD PORTFOLIO
Wayne Tappe
Vice President
Investment experience:
12 years
The high yield market saw stellar returns in 1995. The market benefited from
an extremely robust equity market, declining interest rates and very strong
high-yield mutual fund inflows of $10.7 billion. However, high yield bonds
underperformed many other markets including equities and emerging markets. The
high yield market also absorbed approximately $47.2 billion in new issues -
second only to $60.2 billion in 1993. Most of the new issuance has been used
to fund growth and infrastructure in the cable and telecommunications sectors,
which accounted for about one third of 1995's issues.
The High Yield Portfolio did exceptionally well in 1995, outperforming its
managed benchmark, the Lipper High Current Yield Bond Funds Average. It was
also one of the few funds that was able to outperform the Merrill Lynch Master
High Yield Index, the Portfolio's unmanaged benchmark. In 1995, the Portfolio
focused on media and telecommunications credits. As the year progressed, we
shifted out of most cyclicals, particularly paper and auto-related companies.
Given the signs of continued slowing of the economy and fears of a recession,
the Portfolio increased its credit quality by adding more BB names and
decreasing exposure to CCCs. Our emerging markets investments performed well
in 1995. Many new foreign bonds, which were extremely cheap relative to high
yield spreads, have paid handsome dividends in 1995.
It will be extremely difficult to match last year's returns in 1996. It is
unlikely that a clear set of signals will appear. We expect a sluggish economy
accompanied by declining interest rates. A thirst for yield should not only
attract assets from other fixed income classes to the high yield market, it
should enhance the rate of inflows from high grade funds and pension funds.
INVESTMENT OBJECTIVE
High return by maximizing current income and, to the extent consistent with
that objective, capital appreciation
INVESTMENT POLICY
Primarily a diversified mix of high yield, fixed income securities involving
greater volatility of price and risk of principal and income than high-quality
fixed income securities
The medium and lower quality debt securities in which the Portfolio may invest
are known as "junk bonds."
PORTFOLIO SUMMARY, AS OF DECEMBER 31, 1995
Net Assets $118.1 million
Number of Issues 70
Average Quality* B
Average Duration 4.9 years
* The Average Quality represents a weighted average of the Portfolio's
holdings, including cash, using the Standard & Poor's rating scale.
** Includes cash
Please refer to the prospectus for a description of the risks involved in
international investing, including currency, economic and political risks, as
well as differences in accounting. Keep in mind that bonds offering the
potential for higher yields generally involve a greater degree of credit risk.
ASSET MIX DISTRIBUTION
Cash and Equivalents 7.0%
Foreign Bonds 12.9%
Corporate Bonds 80.1%
DISTRIBUTION OF ASSETS** BY QUALITY
BB-B 92.1%
CCC and below 0.5%
AAA-BBB 7.4%
A14
<PAGE>
HUDSON RIVER TRUST
NOTES ON PERFORMANCE
The chart on the next page shows the performance of The Hudson River Trust
Portfolios together with comparative benchmarks, including both unmanaged
market indices and universes of managed portfolios. The Portfolios' annualized
net rates of return are based on the percentage change in the net asset value
with dividends and capital gains reinvested. Returns are net of investment
management fees and expenses of the Trust. These rates are not representative
of the actual return you would receive under a policy. No policyowner can
invest directly in the Trust. Changes in policy values depend not only on the
investment performance of the Trust, but also on the insurance and
administrative charges, applicable sales charges and the mortality and expense
risk charge applicable under a policy. These policy charges effectively reduce
the dollar amount of any net gains and increase the dollar amount of any net
losses. All performance shown is annualized, unless otherwise noted.
THE BENCHMARKS
Market indices are not subject to any charges for investment advisory fees
typically associated with a managed portfolio. Comparisons with these
benchmarks, therefore, are of limited use. We include them because they are
widely known and may help you to understand the universe of securities from
which each Portfolio is likely to select its holdings.
Portfolio Inception Dates and Comparative Benchmarks:
Growth & Income: October 1, 1993; 25% Value Line Convertibles Index and 75%
Standard & Poor's 500 Index (25% Value Line Conv./75% S&P 500).
Equity Index: March 1, 1994; S&P 500.
Common Stock: January 13, 1976; S&P 500.
Global: August 27, 1987; Morgan Stanley Capital International World Index (MSCI
World).
International: April 1, 1995; Morgan Stanley International Europe, Australia,
Far East Index (MSCI EAFE).
Aggressive Stock: January 27, 1986; 50% Russell 2000/50% S&P Mid Cap.
Conservative Investors: October 2, 1989; 70% Lehman Treasury Bond Composite
Index and 30% S&P 500
(70% Lehman Treas./30% S&P 500).
Balanced: January 27, 1986; 50% Lehman Government/Corporate Bond Index and 50%
S&P 500
(50% Lehman Corp./50% S&P 500).
Growth Investors: October 2, 1989; 30% Lehman Government/Corporate Bond Index
and 70% S&P 500
(30% Lehman Corp./70% S&P 500).
Money Market: July 13, 1981; Salomon Brothers Three-Month T-Bill Index (3-Month
T-Bill).
Intermediate Government Securities: April 1, 1991; Lehman Intermediate
Government Bond Index
(Lehman Intermediate Gov't).
Quality Bond: October 1, 1993; Lehman Aggregate Bond Index (Lehman Aggregate).
High Yield: January 2, 1987; Merrill Lynch High Yield Master Index (Merrill
Lyncg High Yield).
The S&P 500 benchmark includes reinvested dividends. The Lipper Mutual Funds
Survey (Lipper) records the performance of over 7000 mutual funds. According to
Lipper Analytical Services, Inc., the data are presented net of investment
management fees, direct operating expenses, and, for funds with Rule 12b-1
plans, asset-based sales charges. Lipper data provide a more accurate picture
of Trust performance relative to other funds underlying life insurance products
than the market indices.
A15
<PAGE>
HUDSON RIVER TRUST
ANNUALIZED RATES OF RETURN FOR PERIODS ENDING DECEMBER 31, 1995
<TABLE>
<CAPTION>
ONE THREE FIVE TEN FIFTEEN SINCE
PORTFOLIO YEAR YEARS YEARS YEARS YEARS INCEPTION
<S> <C> <C> <C> <C> <C> <C>
THE EQUITY SERIES:
GROWTH & INCOME ................ 24.07 -- -- -- -- 9.66
LIPPER GROWTH & INCOME ......... 30.82 -- -- -- -- 13.47
25% VALUE LINE CONV./75% S&P 500 34.93 -- -- -- -- 15.45
EQUITY INDEX ................... 36.48 -- -- -- -- 19.11
LIPPER S&P 500 INDEX AVG ....... 36.84 -- -- -- -- 18.92
S&P 500 ........................ 37.54 -- -- -- -- 19.89
COMMON STOCK ................... 32.45 17.40 18.16 15.16 14.37% 14.78
LIPPER GROWTH EQUITY ........... 30.79 12.45 16.01 12.95 12.81 14.79
S&P 500 ........................ 37.54 15.30 16.57 14.87 14.79 14.24
GLOBAL ......................... 18.81 18.20 16.49 -- -- 11.36
LIPPER GLOBAL .................. 16.05 13.96 12.28 -- -- 7.87
MSCI WORLD ..................... 20.72 15.83 11.74 -- -- 6.75
INTERNATIONAL .................. -- -- -- -- -- 11.29*
LIPPER INTERNATIONAL ........... -- -- -- -- -- 10.32*
MSCI EAFE ...................... -- -- -- -- -- 9.17*
AGGRESSIVE STOCK ............... 31.63 13.92 21.75 -- -- 20.02
LIPPER SMALL COMPANY GROWTH .... 31.55 14.77 20.78 -- -- 13.42
50% RUSSELL 2000/50% S&P MID-CAP 29.69 13.67 20.16 -- -- 13.58
THE ASSET ALLOCATION SERIES:
CONSERVATIVE INVESTORS ......... 20.40 8.55 10.15 -- -- 9.65
LIPPER FLEXIBLE PORTFOLIO ...... 25.08 10.80 12.85 -- -- 10.28
70% LEHMAN TREAS./30% S&P 500 .. 24.11 10.41 11.73 -- -- 10.55
BALANCED ....................... 19.75 7.34 11.17 -- -- 12.08
LIPPER BALANCED ................ 25.16 10.73 13.04 -- -- 11.34
50% LEHMAN CORP./50% S&P 500 ... 28.39 12.01 13.39 -- -- 12.74
GROWTH INVESTORS ............... 26.37 12.15 17.13 -- -- 16.05
LIPPER FLEXIBLE PORTFOLIO ...... 25.08 10.80 12.85 -- -- 10.28
30% LEHMAN CORP./70% S&P 500 ... 32.05 13.35 14.70 -- -- 11.97
THE FIXED INCOME SERIES:
MONEY MARKET ................... 5.74% 4.24% 4.48% 6.02% -- 7.42%
LIPPER MONEY MARKET ............ 5.37 3.89 4.12 5.64 -- 7.15
3-MONTH T-BILL ................. 5.74 4.34 4.47 5.77 -- 7.09
INTERMEDIATE GOV'T SECURITIES .. 13.33 6.22 -- -- -- 7.63
LIPPER INTERMEDIATE GOVERNMENT . 15.75 6.56 -- -- -- 8.03
LEHMAN INTERMEDIATE GOVERNMENT . 14.41 6.74 -- -- -- 8.17
QUALITY BOND ................... 17.02 -- -- -- -- 4.54
LIPPER CORPORATE DEBT A-RATED .. 18.45 -- -- -- -- 5.38
LEHMAN AGGREGATE ............... 18.47 -- -- -- -- 6.46
HIGH YIELD ..................... 19.92 12.81 14.95 -- -- 10.20
LIPPER HIGH YIELD .............. 16.44 10.18 16.58 -- -- 8.98
MASTER HIGH YIELD .............. 19.91 11.57 17.17 -- -- 11.28
</TABLE>
*Unannualized
Each of the Trust's Portfolios has a different investment objective it seeks to
achieve by following a separate investment policy*. There is no guarantee that
these objectives will be attained. The objectives and policies of each Portfolio
will affect its return and its risks. Performance figures do not reflect the
cost of insurance and if they did the performance quoted would be lower.
Contract values may increase or decrease with investment experience, and reflect
certain contract charges and deductions. Keep in mind as you review past
performance that it is no estimate or indication of future results. Neither the
Money Market Portfolio nor the Intermediate Government Securities Portfolio is
guaranteed or insured by the U.S. Government.
*Not all Portfolios are available in all separate accounts.
A16
<PAGE>
HUDSON RIVER TRUST
GROWTH OF A $10,000 INVESTMENT
The charts shown in these pages illustrate the total value of an assumed
investment in each portfolio
of the Hudson River Trust, except the Money Market Portfolio. The periods
illustrated are from the inception dates shown for each portfolio through
December 31, 1995 (for the Common Stock Portfolio, for the ten years ended
December 31, 1995). The results assume the reinvestment of dividends and
capital gains. Results should not be considered representative of future gains
or losses.
The total value shown for the Hudson River Trust Portfolios reflects management
fees and operating expenses of the portfolio only. They have not been adjusted
for charges and expenses associated with life insurance policies or annuity
contracts. Rates of return on insurance policies and annuity contracts will be
lower because of the deduction of contract-related charges.
Information on these pages constitutes part of the annual report of The Hudson
River Trust and is not intended for separate use.
A table of rates of return for the Hudson River Trust Portfolios and their
comparative benchmarks, as well as additional information regarding the
benchmarks, can be found on the two previous pages of this report.
GROWTH OF A $10,000 INVESTMENT
AS OF DECEMBER 31, 1995
GROWTH & INCOME PORTFOLIO
INVESTED ON OCTOBER 1, 1993 (INCEPTION)
SINCE INCEPTION 10/1/93
<TABLE>
<CAPTION>
GROWTH & LIPPER G&I 75% S&P500/
INCOME S&P500 AVG 25% V LINE CONV
---------- --------- ------------ ---------------
<S> <C> <C> <C> <C>
10/1/93 $10,000 $10,000 $10,000 $10,000
12/31/93 $ 9,975 $10,232 $10,230 $10,170
12/31/94 $ 9,917 $10,366 $10,148 $10,136
12/31/95 $12,305 $14,257 $13,271 $13,584
</TABLE>
Growth & Income Portfolio
December 31, 1995 $12,305
EQUITY INDEX PORTFOLIO
INVESTED ON MARCH 1, 1994 (INCEPTION)
SINCE INCEPTION 3/1/94
<TABLE>
<CAPTION>
EQUITY INDEX S&P 500 LIPPER S&P
-------------- --------- ------------
<S> <C> <C> <C>
3/1/94 $10,000 $ 10,000 $ 10,000
12/31/94 $10,108 $ 10,072 $ 10,038
12/31/95 $13,796 $ 13,852 $ 13,736
</TABLE>
Equity Index Portfolio
December 31, 1995 $13,796*
*The indices and the portfolio produced
substantially similar returns.
A17
<PAGE>
HUDSON RIVER TRUST
GROWTH OF A $10,000 INVESTMENT
AS OF DECEMBER 31, 1995
These charts are not adjusted for charges and expenses associated with life
insurance and annuity contracts.
COMMON STOCK PORTFOLIO
INVESTED ON JANUARY 1, 1986 (TEN YEARS AGO)
<TABLE>
<CAPTION>
COMMON STOCK LIPPER GROWTH
PORTFOLIO S&P500 EQUITY AVG
-------------- --------- ---------------
<S> <C> <C> <C>
12/31/85 $10,000 $10,000 $10,000
12/31/86 $11,734 $11,867 $11,465
12/31/87 $12,612 $12,490 $11,840
12/31/88 $15,442 $14,558 $13,501
12/31/89 $19,394 $19,163 $17,180
12/31/90 $17,821 $18,567 $16,364
12/31/91 $24,574 $24,212 $22,541
12/31/92 $25,363 $26,054 $24,351
12/31/93 $31,662 $28,674 $27,183
12/31/94 $30,984 $29,051 $26,608
12/31/95 $41,038 $39,955 $35,184
</TABLE>
Common Stock Portfolio
December 31, 1995 $41,038
GLOBAL PORTFOLIO
INVESTED ON AUGUST 27, 1987 (INCEPTION)
SINCE INCEPTION 8/27/87
<TABLE>
<CAPTION>
GLOBAL LIPPER
PORTFOLIO MSCI GLOBAL
----------- --------- ---------
<S> <C> <C> <C>
8/27/87 $10,000 $10,000 $ 10,000
12/31/87 $ 8,673 $ 8,808 $ 8,012
12/31/88 $ 9,617 $11,326 $ 9,208
12/31/89 $12,189 $12,549 $ 11,515
12/31/90 $11,448 $ 9,638 $ 10,373
12/31/91 $14,939 $10,843 $ 12,550
12/31/92 $14,867 $ 9,558 $ 12,506
12/31/93 $19,639 $12,707 $ 16,623
12/31/94 $20,666 $13,731 $ 16,008
12/31/95 $24,444 $15,317 $ 18,852
</TABLE>
Global Portfolio
December 31, 1995 $24,444
<PAGE>
AGGRESSIVE STOCK PORTFOLIO
INVESTED ON JANUARY 27,1986 (INCEPTION)
SINCE INCEPTION 1/27/86
<TABLE>
<CAPTION>
AGGRESSIVE STOCK 50% S&P 500/ S&P400 MID 50% S&P MID/ LIPPER SMALL
PORTFOLIO 50%NASDAQ CAP RUSSELL 2000 50% RUSS 2000 GRO AVG S&P500
---------------- -------------- ------------ -------------- --------------- -------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
1/27/86 $10,000 $10,000 $10,000 $10,000 $ 10,000 $10,000 $10,000
12/31/86 $13,588 $11,095 $11,430 $10,403 $ 10,917 $10,696 $11,800
12/31/87 $14,580 $11,094 $11,197 $ 9,487 $ 10,325 $10,250 $12,420
12/31/88 $14,746 $12,871 $13,533 $11,861 $ 12,686 $12,322 $14,477
12/31/89 $21,160 $16,192 $18,343 $13,790 $ 15,996 $15,340 $19,056
12/31/90 $22,888 $14,625 $17,405 $11,104 $ 14,138 $13,592 $18,463
12/31/91 $42,769 $20,644 $26,124 $16,217 $ 20,985 $20,717 $24,076
12/31/92 $41,413 $22,946 $29,236 $19,202 $ 24,038 $23,283 $25,978
12/31/93 $48,356 $25,759 $33,316 $22,828 $ 27,888 $27,353 $28,513
12/31/94 $46,510 $25,540 $32,122 $22,411 $ 27,100 $27,248 $28,889
12/31/95 $61,225 $35,411 $42,064 $28,787 $ 35,193 $36,282 $39,731
</TABLE>
Aggressive Stock Portfolio
December 31, 1995 $61,225
A18
<PAGE>
HUDSON RIVER TRUST
GROWTH OF A $10,000 INVESTMENT
AS OF DECEMBER 31, 1995
These charts are not adjusted for charges and expenses associated with life
insurance and annuity contracts.
CONSERVATIVE INVESTORS PORTFOLIO
INVESTED ON OCTOBER 2, 1989 (INCEPTION)
SINCE INCEPTION 10/2/89
<TABLE>
<CAPTION>
CONSERVATIVE 70% LEH TSY/ LIPPER
INVESTORS PORT 30% S&P500 FLEXIBLE LEHMAN TSY
-------------- -------------- ---------- ------------
<S> <C> <C> <C> <C>
10/2/89 $10,000 $10,000 $10,000 $10,000
12/31/89 $10,309 $10,328 $10,063 $10,380
12/31/90 $10,969 $10,849 $10,087 $11,077
12/31/91 $13,144 $12,962 $12,677 $12,770
12/31/92 $13,905 $13,912 $13,595 $13,692
12/31/93 $15,402 $15,372 $15,452 $15,154
12/31/94 $14,771 $15,070 $15,177 $14,641
12/31/95 $17,785 $18,736 $18,781 $17,329
</TABLE>
Conservative Investors Portfolio
December 31, 1995 $17,785*
*The indices and the portfolio produced
substantially similar returns.
BALANCED PORTFOLIO
INVESTED ON JANUARY 27, 1986 (INCEPTION)
SINCE INCEPTION 1/27/86
<TABLE>
<CAPTION>
BALANCED 50% S&P500/ LIPPER
PORTFOLIO S&P500 50% LEH G/C BAL AVG
----------- --------- ------------- ---------
<S> <C> <C> <C> <C>
1/27/86 $10,000 $10,000 $10,000 $10,000
12/31/86 $12,907 $11,800 $11,647 $11,433
12/31/87 $12,796 $12,420 $12,086 $11,691
12/31/88 $14,494 $14,477 $13,553 $13,102
12/31/89 $19,239 $19,056 $16,725 $15,616
12/31/90 $18,282 $18,463 $17,039 $15,555
12/31/91 $25,826 $24,076 $21,088 $19,498
12/31/92 $25,100 $25,978 $22,690 $21,034
12/31/93 $28,183 $28,513 $25,068 $23,540
12/31/94 $25,992 $28,889 $24,867 $22,947
12/31/95 $31,041 $39,731 $32,260 $28,884
</TABLE>
Balanced Portfolio
December 31, 1995 $31,041
<PAGE>
GROWTH INVESTORS PORTFOLIO
INVESTED ON OCTOBER 2, 1989 (INCEPTION)
SINCE INCEPTION 10/2/89
<TABLE>
<CAPTION>
GROWTH 70% S&P500/ LIPPER
INVESTORS 30% LEH G/C FLEXIBLE S&P500
------------ ------------ --------- ---------
<S> <C> <C> <C> <C>
10/2/89 $10,000 $10,000 $10,000 $10,000
12/31/89 $10,399 $10,252 $10,063 $10,205
12/31/90 $11,503 $10,284 $10,087 $ 9,888
12/31/91 $17,129 $12,935 $12,677 $12,894
12/31/92 $17,974 $13,918 $13,595 $13,875
12/31/93 $20,717 $15,358 $15,452 $15,270
12/31/94 $20,066 $15,337 $15,177 $15,471
12/31/95 $25,357 $20,278 $18,781 $21,277
</TABLE>
Growth Investors Portfolio
December 31, 1995 $25,357
A19
<PAGE>
HUDSON RIVER TRUST
GROWTH OF A $10,000 INVESTMENT
AS OF DECEMBER 31, 1995
These charts are not adjusted for charges and expenses associated with life
insurance and annuity contracts.
INTERMEDIATE GOVERNMENT SECURITIES PORTFOLIO
INVESTED ON APRIL 1, 1991 (INCEPTION)
SINCE INCEPTION 4/1/91
<TABLE>
<CAPTION>
INTER GOV'T LEHMAN INT LIPPER INT
SECURITIES PORT GOV'T BOND GOV'T BOND
--------------- ------------ ------------
<S> <C> <C> <C>
4/1/91 $10,000 $10,000 $10,000
12/31/91 $11,207 $11,165 $11,211
12/31/92 $11,835 $11,939 $11,897
12/31/93 $13,087 $12,914 $12,936
12/31/94 $12,514 $12,689 $12,436
12/31/95 $14,182 $14,517 $14,474
</TABLE>
Intermediate Government Securities Portfolio
December 31, 1995 $14,182*
*The indices and the portfolio produced
substantially similar returns
QUALITY BOND PORTFOLIO
INVESTED ON OCTOBER 1, 1993 (INCEPTION)
SINCE INCEPTION 10/1/93
<TABLE>
<CAPTION>
QUALITY BOND LIPPER CORP
PORTFOLIO LEHMAN AGG DEBT A RATED
-------------- ------------ --------------
<S> <C> <C> <C>
10/1/93 $10,000 $10,000 $10,000
12/31/93 $ 9,949 $10,006 $ 9,958
12/31/94 $ 9,442 $ 9,714 $ 9,499
12/31/95 $11,050 $11,509 $11,251
</TABLE>
Quality Bond Portfolio
December 31, 1995 $11,050*
*The indices and the portfolio produced
substantially similar returns
HIGH YIELD PORTFOLIO
INVESTED ON JANUARY 2, 1987 (INCEPTION)
SINCE INCEPTION 1/2/87
<TABLE>
<CAPTION>
HIGH YIELD MERRILL LYNCH LIPPER HIGH
PORTFOLIO HIGH YLD MAST CURRENT YIELD
------------ --------------- ---------------
<S> <C> <C> <C>
1/2/87 $10,000 $10,000 $10,000
12/31/87 $10,468 $10,467 $10,207
12/31/88 $11,488 $11,877 $11,522
12/31/89 $12,078 $12,379 $11,380
12/31/90 $11,944 $11,841 $10,178
12/31/91 $14,868 $15,935 $13,875
12/31/92 $16,698 $18,829 $16,312
12/31/93 $20,564 $22,065 $19,369
12/31/94 $19,993 $21,808 $18,667
12/31/95 $23,975 $26,150 $21,826
</TABLE>
High Yield Portfolio
December 31, 1995 $23,975
A20
<PAGE>
Section B
The Hudson River Trust
Financial Statements
December 31, 1995
<PAGE>
THE HUDSON RIVER TRUST
STATEMENTS OF ASSETS AND LIABILITIES
December 31, 1995
<TABLE>
<CAPTION>
INTERMEDIATE
GOVERNMENT GROWTH AND
MONEY MARKET SECURITIES QUALITY BOND HIGH YIELD INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
ASSETS:
Investments at value (Cost:
Money Market Portfolio--$382,846,598;
Intermediate Government Securities
Portfolio--$74,723,960; Quality Bond
Portfolio--$149,681,749; High Yield
Portfolio--$110,787,784; Growth and
Income Portfolio--$86,427,597; Equity
Index Portfolio--$142,183,170; Common
Stock Portfolio--$3,900,452,197;
Global Portfolio--$603,019,021;
International Portfolio--$28,252,263;
Aggressive Stock
Portfolio--$2,162,160,335;
Conservative Investors
Portfolio--$233,830,095; Balanced
Portfolio--$1,383,682,049; Growth
Investors Portfolio-- $760,456,806)
(Notes 1 and 3) ....................... $383,012,005 $76,370,937 $153,826,664 $112,882,893 $ 97,536,248
Cash ................................... 116,470 16,517 47,771 30,052 18,113
Foreign cash ........................... -- -- -- -- --
Receivable for securities sold ......... -- 3,597,770 -- 7,298,266 88,427
Deposits received for securities
lending ............................... -- 6,643,688 20,985,500 18,254,850 1,066,750
Receivable from Separate Accounts for
Trust shares sold ..................... 3,238,781 1,098,522 445,411 1,039,727 1,148,914
Unrealized appreciation of forward
currency contracts (Notes 1 and 3) ... -- -- 24,934 -- --
Dividends, interest and other
receivables ........................... 490,991 405,766 3,187,876 2,196,225 311,126
-------------- -------------- -------------- -------------- -------------
Total assets ........................ 386,858,247 88,133,200 178,518,156 141,702,013 100,169,578
-------------- -------------- -------------- -------------- -------------
LIABILITIES:
Options written at value (Premiums
received: Common Stock Portfolio--
$31,689,532)(Notes 1 and 3) ........... -- -- -- -- --
Payable to custodian ................... -- -- -- -- --
Payable for securities purchased ...... -- 9,666,046 -- 5,246,556 994,457
Payable for securities loaned .......... -- 6,643,688 20,985,500 18,254,850 1,066,750
Payable to Separate Accounts for Trust
shares redeemed ....................... -- -- -- -- --
Unrealized depreciation of forward
currency contracts (Notes 1 and 3) ... -- -- -- -- --
Variation margin payable on futures
contracts ............................. -- -- -- -- --
Investment advisory fees payable ...... 112,296 27,477 67,731 50,288 41,007
Trustees' fees payable ................. 20,075 3,841 1,778 2,958 575
Accrued expenses ....................... 34,930 12,323 20,300 18,778 13,968
-------------- -------------- -------------- -------------- -------------
Total liabilities ................... 167,301 16,353,375 21,075,309 23,573,430 2,116,757
-------------- -------------- -------------- -------------- -------------
NET ASSETS ............................. $386,690,946 $71,779,825 $157,442,847 $118,128,583 $ 98,052,821
============== ============== ============== ============== =============
COMPONENTS OF NET ASSETS (NOTE 1):
Paid in capital ....................... $386,427,732 $79,487,800 $159,028,166 $117,138,948 $ 87,432,803
Accumulated undistributed
(overdistributed) net investment
income ............................... 97,807 22,777 63,771 22,557 10,278
Accumulated net realized loss ......... -- (9,377,729) (5,823,240) (1,128,031) (498,911)
Unrealized appreciation of investments
and foreign currency denominated
assets and liabilities ............... 165,407 1,646,977 4,174,150 2,095,109 11,108,651
-------------- -------------- -------------- -------------- -------------
NET ASSETS ............................. $386,690,946 $71,779,825 $157,442,847 $118,128,583 $ 98,052,821
============== ============== ============== ============== =============
Shares outstanding (Note 4) ............ 38,057,162 7,577,459 16,383,900 12,254,186 8,380,234
============== ============== ============== ============== =============
Net asset value, offering and
redemption price per share (Note 1) .. $ 10.16 $ 9.47 $ 9.61 $ 9.64 $ 11.70
============== ============== ============== ============== =============
</TABLE>
See Notes to Financial Statements.
1
<PAGE>
<TABLE>
<CAPTION>
AGGRESSIVE CONSERVATIVE GROWTH
EQUITY INDEX COMMON STOCK GLOBAL INTERNATIONAL STOCK INVESTORS BALANCED INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- -------------- -------------- -------------- --------------- -------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
$163,208,624 $4,875,871,045 $678,407,015 $29,176,683 $2,675,322,143 $248,258,573 $1,504,511,537 $ 878,864,009
1,037,577 13,990,895 324,618 -- 4,389,240 297,764 4,810,822 2,626,146
-- 1,025 6,342,916 403,458 -- -- -- 1,374,231
-- 1,157,500 1,818,300 95,798 19,636,221 -- 3,050,337 3,264,186
476,000 18,344,700 34,167,000 375,100 65,963,300 93,741,041 160,627,359 181,639,018
1,888,033 9,683,756 2,459,258 -- 8,490,410 432,486 128,251 4,468,726
-- -- -- 19,961 -- -- -- --
290,725 7,207,381 1,317,515 12,870 304,278 3,250,877 13,905,148 8,351,971
- -------------- -------------- -------------- --------------- -------------- -------------- -------------- ---------------
166,900,959 4,926,256,302 724,836,622 30,083,870 2,774,105,592 345,980,741 1,687,033,454 1,080,588,287
- -------------- -------------- -------------- --------------- -------------- -------------- -------------- ---------------
-- 18,316,250 -- -- -- -- -- --
-- -- -- 23,755 -- -- -- --
549,349 8,035,250 3,671,218 961,083 6,430,077 -- 2,659,384 2,298,845
476,000 18,344,700 34,167,000 375,100 65,963,300 93,741,041 160,627,359 181,639,018
-- -- -- 14,769 -- -- -- --
-- -- 432,014 -- -- -- -- 54,671
10,362 -- -- -- -- -- -- --
43,814 1,365,761 281,382 17,216 954,156 107,793 442,263 362,330
851 129,332 6,774 76 39,395 3,140 35,388 8,958
35,302 388,009 137,841 8,008 203,815 27,772 127,332 90,605
- -------------- -------------- -------------- --------------- -------------- -------------- -------------- ---------------
1,115,678 46,579,302 38,696,229 1,400,007 73,590,743 93,879,746 163,891,726 184,454,427
- -------------- -------------- -------------- --------------- -------------- -------------- -------------- ---------------
$165,785,281 $4,879,677,000 $686,140,393 $28,683,863 $2,700,514,849 $252,100,995 $1,523,141,728 $ 896,133,860
============== ============== ============== =============== ============== ============== ============== ===============
$144,880,868 $3,916,746,349 $612,649,654 $27,831,272 $2,191,338,507 $237,609,491 $1,402,865,274 $ 778,073,456
(851) 8,246,095 455,586 6,487 (4,129) 63,026 86,599 105,968
(123,990) (34,107,750) (1,942,133) (98,401) (3,981,337) -- (639,633) (397,563)
21,029,254 988,792,306 74,977,286 944,505 513,161,808 14,428,478 120,829,488 118,351,999
- -------------- -------------- -------------- --------------- -------------- -------------- -------------- ---------------
$165,785,281 $4,879,677,000 $686,140,393 $28,683,863 $2,700,514,849 $252,100,995 $1,523,141,728 $ 896,133,860
============== ============== ============== =============== ============== ============== ============== ===============
12,630,306 296,135,981 43,590,992 2,637,866 75,690,902 21,883,284 90,899,832 50,677,525
============== ============== ============== =============== ============== ============== ============== ===============
$ 13.13 $ 16.48 $ 15.74 $ 10.87 $ 35.68 $ 11.52 $ 16.76 $ 17.68
============== ============== ============== =============== ============== ============== ============== ===============
</TABLE>
2
<PAGE>
THE HUDSON RIVER TRUST
STATEMENTS OF OPERATIONS
Year Ended December 31, 1995
<TABLE>
<CAPTION>
INTERMEDIATE
GOVERNMENT GROWTH AND
MONEY MARKET SECURITIES QUALITY BOND HIGH YIELD INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- -------------- ------------- ------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Income** (Note 1):
Dividends (including $3,791,511 and
$1,543,363 from affiliated companies
for the Common Stock and Aggressive
Stock Portfolios, respectively) ....... $ -- $ -- $ -- $ -- $ 1,276,889
Interest ............................... 19,759,375 3,998,091 9,694,417 10,449,665 1,026,456
-------------- -------------- -------------- ------------- ------------
Total income .......................... 19,759,375 3,998,091 9,694,417 10,449,665 2,303,345
-------------- -------------- -------------- ------------- ------------
Expenses (Note 2):
Investment advisory fee ................ 1,320,130 295,954 790,598 521,901 338,067
Custody fees ........................... 22,774 15,839 13,115 22,425 13,338
Printing and mailing expenses .......... 57,615 10,178 25,013 16,215 10,005
Professional fees ...................... 19,063 11,811 11,787 9,663 7,914
SEC registration fees .................. 11,190 -- -- 231 258
Trustees' fees ......................... 10,439 2,099 4,591 3,028 1,784
Miscellaneous .......................... 5,834 2,472 2,456 2,160 2,075
-------------- -------------- -------------- ------------- ------------
Total expenses ........................ 1,447,045 338,353 847,560 575,623 373,441
-------------- -------------- -------------- ------------- ------------
NET INVESTMENT INCOME .................... 18,312,330 3,659,738 8,846,857 9,874,042 1,929,904
-------------- -------------- -------------- ------------- ------------
REALIZED AND UNREALIZED GAIN (LOSS)
(NOTES 1 AND 3):
Realized Gain (Loss):
On securities (including $13,347,567,
$9,375, $(12,968,115) and
$(22,075,146) from affiliated
companies for the Common Stock,
Global, Aggressive Stock and Balanced
Portfolios, respectively) ............. -- 1,061,357 3,271,727 1,037,899 (78,675)
On options written ..................... -- -- -- -- --
On foreign currency transactions ...... -- -- 40,304 -- --
On futures contracts ................... -- -- -- -- --
-------------- -------------- -------------- ------------- ------------
Realized gain (loss)--net ............... -- 1,061,357 3,312,031 1,037,899 (78,675)
-------------- -------------- -------------- ------------- ------------
Change in Unrealized
Appreciation/Depreciation:
On securities .......................... 145,252 2,579,005 10,322,173 6,108,056 11,348,703
On options written ..................... -- -- -- -- --
On foreign currency transactions ...... -- -- 29,235 -- --
On futures contracts ................... -- -- -- -- --
-------------- -------------- -------------- ------------- ------------
Unrealized appreciation--net ............ 145,252 2,579,005 10,351,408 6,108,056 11,348,703
-------------- -------------- -------------- ------------- ------------
REALIZED AND UNREALIZED GAIN--NET ....... 145,252 3,640,362 13,663,439 7,145,955 11,270,028
-------------- -------------- -------------- ------------- ------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS .............................. $18,457,582 $7,300,100 $22,510,296 $17,019,997 $13,199,932
============== ============== ============== ============= ============
</TABLE>
- ------------
* For the Period from April 3, 1995 (Commencement of Operations) to
December 31, 1995.
** Net of foreign taxes withheld on dividends of $10,201, $381,313,
$615,845, $8,121, $130,466, $34,870 and $84,420 for the Equity Index,
Common Stock, Global, International, Aggressive Stock, Balanced and
Growth Investors Portfolios, respectively, and on interest of $84 and
$82 for the Global and Growth Investors Portfolios, respectively.
See Notes to Financial Statements.
3
<PAGE>
<TABLE>
<CAPTION>
AGGRESSIVE CONSERVATIVE GROWTH
EQUITY INDEX COMMON STOCK GLOBAL INTERNATIONAL STOCK INVESTORS BALANCED INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO* PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 2,080,947 $ 62,582,054 $ 7,426,190 $ 55,208 $ 9,527,352 $ 524,570 $ 10,938,202 $ 5,787,751
180,058 6,975,119 5,799,137 172,902 7,494,955 12,303,070 42,020,343 21,516,203
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
2,261,005 69,557,173 13,225,327 228,110 17,022,307 12,827,640 52,958,545 27,303,954
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
295,735 14,946,487 2,957,363 73,079 10,210,784 1,156,344 5,237,550 3,584,538
91,943 94,352 318,608 6,405 28,372 36,859 36,724 92,632
13,110 719,153 94,530 1,035 379,328 36,225 248,055 114,540
8,698 174,480 25,957 4,912 94,703 14,048 66,613 31,069
-- -- 149 -- 2,380 -- -- --
2,527 134,132 17,290 192 72,027 6,525 47,299 20,690
1,129 55,633 8,355 32 31,203 2,868 18,844 8,582
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
413,142 16,124,237 3,422,252 85,655 10,818,797 1,252,869 5,655,085 3,852,051
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
1,847,863 53,432,936 9,803,075 142,455 6,203,510 11,574,771 47,303,460 23,451,903
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
746,923 219,787,101 18,939,519 117,369 346,368,084 11,270,671 64,616,058 19,808,245
-- 36,109,107 -- -- -- -- -- --
-- 6,565,318 (1,134,719) 149,406 -- -- -- 285,771
396,452 -- -- -- -- -- -- --
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
1,143,375 262,461,526 17,804,800 266,775 346,368,084 11,270,671 64,616,058 20,094,016
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
21,460,414 832,566,741 72,201,148 924,420 262,696,319 16,138,395 144,740,180 114,934,096
-- 12,585,703 -- -- -- -- -- --
-- 444 (95,099) 20,085 -- -- -- (234)
3,800 -- -- -- -- -- -- --
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
21,464,214 845,152,888 72,106,049 944,505 262,696,319 16,138,395 144,740,180 114,933,862
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
22,607,589 1,107,614,414 89,910,849 1,211,280 609,064,403 27,409,066 209,356,238 135,027,878
- -------------- -------------- ------------- --------------- -------------- -------------- -------------- -------------
$24,455,452 $1,161,047,350 $99,713,924 $1,353,735 $615,267,913 $38,983,837 $256,659,698 $158,479,781
============== ============== ============= =============== ============== ============== ============== =============
</TABLE>
4
<PAGE>
THE HUDSON RIVER TRUST
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
INTERMEDIATE GOVERNMENT
MONEY MARKET PORTFOLIO SECURITIES PORTFOLIO
-------------------------------- -------------------------------
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
--------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income ................................ $ 18,312,330 $ 11,408,342 $ 3,659,738 $ 7,088,044
Realized gain (loss)--net ............................ -- -- 1,061,357 (10,439,086)
Change in unrealized appreciation/depreciation of
investments and foreign currency denominated assets
and liabilities--net ................................ 145,252 (9,847) 2,579,005 (2,940,993)
--------------- --------------- -------------- ---------------
Net increase (decrease) in net assets from operations 18,457,582 11,398,495 7,300,100 (6,292,035)
--------------- --------------- -------------- ---------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS (NOTE 1):
Dividends from net investment income ................. (18,199,892) (11,411,476) (3,633,574) (7,088,604)
Dividends in excess of net investment income ........ -- -- -- --
Distributions from realized gains .................... -- -- -- --
Distributions in excess of realized gains ............ -- -- -- --
Tax return of capital distributions .................. -- -- -- --
--------------- --------------- -------------- ---------------
Decrease in net assets from dividends and
distributions ....................................... (18,199,892) (11,411,476) (3,633,574) (7,088,604)
--------------- --------------- -------------- ---------------
SHARE TRANSACTIONS (NOTES 1 AND 4):
Shares sold .......................................... 394,575,427 355,157,130 29,533,754 33,872,981
Shares issued in connection with the substitution of
the Short-Term World Income Portfolio ............... -- -- -- 2,582,814
Shares issued in reinvestment of dividends and
distributions ....................................... 18,199,892 11,411,476 3,633,574 7,088,604
Shares redeemed ...................................... (351,733,059) (289,624,991) (13,571,893) (140,156,888)
--------------- --------------- -------------- ---------------
Net increase (decrease) in net assets derived from
share transactions .................................. 61,042,260 76,943,615 19,595,435 (96,612,489)
--------------- --------------- -------------- ---------------
INCREASE (DECREASE) IN NET ASSETS ..................... 61,299,950 76,930,634 23,261,961 (109,993,128)
NET ASSETS, BEGINNING OF PERIOD ....................... 325,390,996 248,460,362 48,517,864 158,510,992
--------------- --------------- -------------- ---------------
NET ASSETS, END OF PERIOD* ............................ $ 386,690,946 $ 325,390,996 $ 71,779,825 $ 48,517,864
=============== =============== ============== ===============
</TABLE>
- ------------
* Including accumulated undistributed (overdistributed) net investment
income of $97,807 and $(14,631) for the Money Market Portfolio and
$22,777 and $(3,387) for the Intermediate Government Securities
Portfolio and $63,771 and $683,882 for the Quality Bond Portfolio and
$22,557 and $(6,358) for the High Yield Portfolio and $10,278 and $(69)
for the Growth and Income Portfolio and $(851) and $(113) for the
Equity Index Portfolio as of December 31, 1995 and December 31, 1994,
respectively.
** Commencement of Operations.
See Notes to Financial Statements.
5
<PAGE>
<TABLE>
<CAPTION>
GROWTH AND INCOME
QUALITY BOND PORTFOLIO HIGH YIELD PORTFOLIO PORTFOLIO EQUITY INDEX PORTFOLIO
- ------------------------------ ------------------------------ ---------------------------- -------------------------------
MARCH 1, 1994**
YEAR ENDED TO
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994 1995 1994 1995 1994
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 8,846,857 $ 8,721,547 $ 9,874,042 $ 6,297,910 $ 1,929,904 $ 422,647 $ 1,847,863 $ 644,079
3,312,031 (10,171,031) 1,037,899 (1,709,091) (78,675) (409,119) 1,143,375 110,383
10,351,408 (4,533,902) 6,108,056 (6,485,505) 11,348,703 (250,229) 21,464,214 (434,960)
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
22,510,296 (5,983,386) 17,019,997 (1,896,686) 13,199,932 (236,701) 24,455,452 319,502
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
(8,729,254) (7,694,742) (9,874,042) (6,297,910) (1,919,557) (422,714) (1,841,475) (644,216)
-- -- (385,462) (85,166) -- -- -- --
-- -- -- -- -- -- (1,143,375) (110,383)
-- -- -- -- -- -- (84,099) (46,993)
-- (627,091) -- -- -- -- (123) --
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
(8,729,254) (8,321,833) (10,259,504) (6,383,076) (1,919,557) (422,714) (3,069,072) (801,592)
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
18,946,820 33,996,457 46,607,272 30,003,628 57,426,026 31,788,696 153,767,030 39,737,348
-- -- -- -- -- -- -- --
8,729,254 8,321,833 10,259,504 6,383,076 1,919,557 422,714 3,069,072 801,592
(11,589,738) (5,269,742) (19,393,315) (21,380,848) (4,095,508) (1,485,659) (49,185,409) (3,308,642)
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
16,086,336 37,048,548 37,473,461 15,005,856 55,250,075 30,725,751 107,650,693 37,230,298
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
29,867,378 22,743,329 44,233,954 6,726,094 66,530,450 30,066,336 129,037,073 36,748,208
127,575,469 104,832,140 73,894,629 67,168,535 31,522,371 1,456,035 36,748,208 --
- -------------- -------------- -------------- -------------- ------------- ------------- -------------- ---------------
$157,442,847 $127,575,469 $118,128,583 $ 73,894,629 $98,052,821 $31,522,371 $165,785,281 $36,748,208
============== ============== ============== ============== ============= ============= ============== ===============
</TABLE>
6
<PAGE>
THE HUDSON RIVER TRUST
STATEMENTS OF CHANGES IN NET ASSETS (Concluded)
<TABLE>
<CAPTION>
INTERNATIONAL
COMMON STOCK PORTFOLIO GLOBAL PORTFOLIO PORTFOLIO
------------------------------ ------------------------------ ------------------
YEAR ENDED YEAR ENDED APRIL 3, 1995**
DECEMBER 31, DECEMBER 31, TO
1995 1994 1995 1994 DECEMBER 31,1995
-------------- -------------- -------------- -------------- ------------------
<S> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM
OPERATIONS:
Net investment income ................. $ 53,432,936 $ 47,048,382 $ 9,803,075 $ 3,875,457 $ 142,455
Realized gain (loss)--net ............. 262,461,526 194,537,213 17,804,800 8,257,708 266,775
Change in unrealized
appreciation/depreciation of
investments and foreign currency
denominated assets and
liabilities--net ..................... 845,152,888 (317,116,958) 72,106,049 (6,372,853) 944,505
-------------- -------------- -------------- -------------- -----------------
Net increase (decrease) in net assets
from operations ...................... 1,161,047,350 (75,531,363) 99,713,924 5,760,312 1,353,735
-------------- -------------- -------------- -------------- -----------------
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS (NOTE 1):
Dividends from net investment income . (53,432,936) (47,048,382) (9,500,310) (3,755,996) (142,455)
Dividends in excess of net investment
income ............................... (6,567,658) (1,675,372) -- -- (240,038)
Distributions from realized gains .... (262,461,526) (187,473,461) (17,804,800) (8,257,708) (118,651)
Distributions in excess of realized
gains ................................ (8,497,379) -- (1,081,237) (134,077) --
Tax return of capital distributions .. -- (1,707,109) (546,316) (395,364) --
-------------- -------------- -------------- -------------- -----------------
Decrease in net assets from dividends
and distributions .................... (330,959,499) (237,904,324) (28,932,663) (12,543,145) (501,144)
-------------- -------------- -------------- -------------- -----------------
SHARE TRANSACTIONS (NOTES 1 AND 4):
Shares sold ........................... 509,750,491 520,896,037 229,097,991 302,129,663 29,365,420
Shares issued in reinvestment of
dividends and distributions .......... 330,959,499 237,904,324 28,932,663 12,543,145 501,144
Shares redeemed ....................... (257,365,702) (104,247,444) (64,369,805) (27,448,676) (2,035,292)
-------------- -------------- -------------- -------------- -----------------
Net increase (decrease) in net assets
derived from share transactions ..... 583,344,288 654,552,917 193,660,849 287,224,132 27,831,272
-------------- -------------- -------------- -------------- -----------------
INCREASE (DECREASE) IN NET ASSETS ..... 1,413,432,139 341,117,230 264,442,110 280,441,299 28,683,863
NET ASSETS, BEGINNING OF PERIOD ....... 3,466,244,861 3,125,127,631 421,698,283 141,256,984 --
-------------- -------------- -------------- -------------- -----------------
NET ASSETS, END OF PERIOD* ............. $4,879,677,000 $3,466,244,861 $686,140,393 $421,698,283 $28,683,863
============== ============== ============== ============== =================
</TABLE>
- ------------
* Including accumulated undistributed (overdistributed) net investment
income of $8,246,095 and $3,552,516 for the Common Stock Portfolio and
$455,586 and $215,631 for the Global Portfolio and $(4,129) and $12,105
for the Aggressivie Stock Portfolio and $63,026 and $(1,522) for the
Conservative Investors Portfolio and $86,599 and $(26,573) for the
Balanced Portfolio and $105,968 and $146,879 for the Growth Investors
Portfolio, as of December 31, 1995 and December 31, 1994, respectively,
and $6,487 for the International Portfolio, as of December 31, 1995.
** Commencement of Operations.
See Notes to Financial Statements.
7
<PAGE>
<TABLE>
<CAPTION>
CONSERVATIVE INVESTORS
AGGRESSIVE STOCK PORTFOLIO PORTFOLIO BALANCED PORTFOLIO GROWTH INVESTORS PORTFOLIO
- ------------------------------ ------------------------------ ------------------------------ ------------------------------
YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31, YEAR ENDED DECEMBER 31,
1995 1994 1995 1994 1995 1994 1995 1994
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 6,203,510 $ 2,046,981 $ 11,574,771 $ 7,840,102 $ 47,303,460 $ 38,893,215 $ 23,451,903 $ 12,859,008
346,368,084 (44,726,592) 11,270,671 (9,714,278) 64,616,058 (18,710,641) 20,094,016 (7,561,554)
262,696,319 (7,416,655) 16,138,395 (3,628,013) 144,740,180 (133,794,748) 114,933,862 (17,401,140)
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
615,267,913 (50,096,266) 38,983,837 (5,502,189) 256,659,698 (113,612,174) 158,479,781 (12,103,686)
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
(6,203,510) (2,006,386) (11,510,223) (7,847,155) (47,099,230) (38,893,215) (23,451,903) (12,859,008)
(43,012) -- -- -- -- (2,417,748) (429,740) (323,341)
(300,293,392) -- (1,556,393) -- (41,562,533) -- (11,896,371) --
-- -- -- -- -- -- -- --
-- (49,382) -- -- -- (202,506) -- --
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
(306,539,914) (2,055,768) (13,066,616) (7,847,155) (88,661,763) (41,513,469) (35,778,014) (13,182,349)
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
843,611,785 691,803,895 50,112,293 72,545,380 55,178,023 163,763,699 264,281,654 240,852,053
306,539,914 2,055,768 13,066,616 7,847,155 88,661,763 41,513,469 35,778,014 13,182,349
(590,529,129) (366,875,063) (10,686,445) (7,769,739) (118,515,605) (84,972,287) (19,105,124) (14,738,042)
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
559,622,570 326,984,600 52,492,464 72,622,796 25,324,181 120,304,881 280,954,544 239,296,360
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
868,350,569 274,832,566 78,409,685 59,273,452 193,322,116 (34,820,762) 403,656,311 214,010,325
1,832,164,280 1,557,331,714 173,691,310 114,417,858 1,329,819,612 1,364,640,374 492,477,549 278,467,224
- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------
$2,700,514,849 $1,832,164,280 $252,100,995 $173,691,310 $1,523,141,728 $1,329,819,612 $896,133,860 $492,477,549
============== ============== ============== ============== ============== ============== ============== ==============
</TABLE>
8
<PAGE>
THE HUDSON RIVER TRUST
MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
EFFECTIVE
PRINCIPAL VALUE ANNUAL
AMOUNT NOTE 1 YIELD*
- --------------------------------------- ------------ ------------ -----------
<S> <C> <C> <C>
SHORT-TERM DEBT SECURITIES:
BANK NOTES
Suntrust Bank
Due 02/29/96 .......................... $ 4,500,000 $ 4,509,944 5.61%
Wachovia Bank N. Carolina
Due 11/07/96 .......................... 10,050,000 10,194,519 5.40
------------
TOTAL BANK NOTES (3.8%) .............. 14,704,463
------------
BANKERS' ACCEPTANCES
Bank of Tokyo:
Due 02/05/96 .......................... 4,000,000 3,977,019 5.85
Due 03/05/96 .......................... 10,000,000 9,898,800 5.79
Corestates National Bank
Due 04/23/96 .......................... 2,800,000 2,750,984 5.77
Mitsubishi Bank Ltd.-N.Y.:
Due 02/06/96 .......................... 1,900,000 1,888,268 6.13
Due 02/20/96 .......................... 1,150,000 1,140,283 6.14
------------
TOTAL BANKERS' ACCEPTANCES (5.1%) .. 19,655,354
------------
CERTIFICATES OF DEPOSIT
Mitsubishi Bank Ltd.-N.Y.
Due 02/29/96 .......................... 9,000,000 9,001,838 6.08
Norinchuckin Bank Ltd.:
Due 03/11/96 .......................... 10,000,000 10,007,979 5.62
Due 03/14/96 .......................... 5,000,000 5,004,387 5.62
National Westminster Bank-U.S.A.
Due 01/22/96 .......................... 9,000,000 9,001,473 5.71
------------
TOTAL CERTIFICATES OF DEPOSIT (8.5%)
33,015,677
------------
COMMERCIAL PAPER
Alpha Finance Corp.:
Due 02/27/96 .......................... 5,500,000 5,451,235 5.66
Due 03/15/96 .......................... 5,000,000 4,943,633 5.60
American Express Credit Corp.
Due 04/09/96 .......................... 7,000,000 6,896,110 5.55
ASCC Commercial Paper:
Due 02/01/96 .......................... 4,000,000 3,980,127 5.66
Due 02/20/96 .......................... 10,000,000 9,921,856 5.66
ASI Funding Corp.
Due 02/02/96 .......................... 17,300,000 17,211,606 5.65
Beta Finance, Inc.
Due 02/02/96 .......................... 7,900,000 7,859,635 5.65
Campbell Soup Co.
Due 02/06/96 .......................... 8,055,000 8,009,001 5.66
Chemical Banking Corp.
Due 03/21/96 .......................... 10,000,000 9,878,367 5.60
Crosby Head Funding
Due 01/25/96 .......................... 15,000,000 14,940,417 5.75
Ciesco LP
Due 01/18/96 .......................... 2,300,000 2,293,263 5.80
Dynamic Funding Corp.
Due 01/25/96 .......................... 2,400,000 2,398,886 5.81
Equipment Funding, Inc.
Due 02/07/96 .......................... 4,800,000 4,771,868 5.66
ESC Securitization, Inc.
Due 02/01/96 .......................... 10,000,000 9,950,408 5.65
Ford Motor Credit Co.:
Due 02/13/96 .......................... 8,000,000 7,945,800 5.67
Due 02/28/96 .......................... 7,000,000 6,937,583 5.60
</TABLE>
9
<PAGE>
THE HUDSON RIVER TRUST
MONEY MARKET PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
EFFECTIVE
PRINCIPAL ANNUAL
AMOUNT VALUE (NOTE 1) YIELD*
- ------------------------------------------------------ ------------ -------------- -----------
<S> <C> <C> <C>
SHORT-TERM DEBT SECURITIES (Continued):
Greenwich Funding:
Due 02/09/96 ......................................... $ 7,000,000 $ 6,956,791 5.67%
Due 02/21/96 ......................................... 200,000 198,407 5.66
International Securitization:
Due 01/12/96 ......................................... 11,870,000 11,845,911 5.87
Due 03/28/96 ......................................... 6,000,000 5,920,790 5.60
Merrill Lynch & Co., Inc.:
Due 01/31/96 ......................................... 4,700,000 4,677,231 5.70
Due 03/29/96 ......................................... 11,000,000 10,854,250 5.56
Morgan Stanley Group, Inc.:
Due 01/02/96 ......................................... 9,500,000 9,495,551 5.87
Due 02/12/96 ......................................... 4,200,000 4,172,023 5.70
Norwest Corp.
Due 02/26/96 ......................................... 15,000,000 14,869,258 5.66
Preferred Receivables Funding
Due 01/05/96 ......................................... 3,634,000 3,630,578 5.90
Premium Funding
Due 03/08/96 ......................................... 17,000,000 16,825,027 5.63
Progress Funding Corp.
Due 01/16/96 ......................................... 15,300,000 15,260,263 5.74
Ranger Funding Corp.:
Due 02/09/96 ......................................... 8,000,000 7,950,709 5.66
Due 02/27/96 ......................................... 9,200,000 9,118,429 5.66
Sumitomo Corp. of America
Due 03/13/96 ......................................... 10,000,000 9,889,617 5.63
Triple A Funding:
Due 01/12/96 ......................................... 5,300,000 5,289,244 5.87
Due 02/05/96 ......................................... 4,500,000 4,474,979 5.66
Working Capital Management Corp.
Due 01/16/96 ......................................... 11,343,000 11,313,540 5.74
--------------
TOTAL COMMERCIAL PAPER (71.4%) ...................... 276,132,393
--------------
VARIABLE RATE LIBOR
American Express Centerian
Due 06/14/96 ......................................... 10,000,000 10,000,821 5.93
Boatmen's First National Bank
Due 02/14/96 ......................................... 10,000,000 10,002,636 5.85
CS First Boston, Inc.
Due 03/29/96 ......................................... 9,500,000 9,500,000 5.90
Goldman Sachs & Co.
Due 01/08/96 ......................................... 10,000,000 10,000,661 5.93
--------------
TOTAL VARIABLE RATE LIBOR (10.2%) ................... 39,504,118
--------------
TOTAL INVESTMENTS IN SHORT-TERM DEBT SECURITIES (99.0%)
(Amortized Cost $382,846,598) ........................ 383,012,005
CASH AND RECEIVABLES LESS LIABILITIES (1.0%) ......... 3,678,941
--------------
NET ASSETS (100.0%) ................................... $386,690,946
==============
</TABLE>
- ------------
* Based on market values at the close of business on December 31, 1995.
See Notes to Financial Statements.
10
<PAGE>
THE HUDSON RIVER TRUST
INTERMEDIATE GOVERNMENT SECURITIES PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
- -----------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES:
CREDIT SENSITIVE
ASSET BACKED (4.4%)
Main Place Funding
6.108% Floater, 10/25/00 (a) ... $ 3,200,000 $ 3,201,344
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (12.8%)
Federal Home Loan Bank
7.61%, 04/25/02 ................. 3,598,143 3,653,807
Federal Home Loan
Mortgage Corp.
6.24%, 07/15/97 ................. 3,141,534 3,185,704
Federal National
Mortgage Association
6.494% Floater, 09/25/21(a) .... 2,342,645 2,345,574
-------------
9,185,085
-------------
MORTGAGE RELATED (47.3%)
Federal Home Loan
Mortgage Corp.
7.0%, 12/13/10 .................. 5,900,000 6,010,625
9.5%, 01/01/20 .................. 5,016 5,336
Federal National
Mortgage Association:
11.5%, 06/01/20 ................. 1,337,162 1,524,366
7.89%, 09/01/22 ................. 2,092,514 2,160,522
7.634%, 01/01/23 ................ 2,211,914 2,245,093
8.5%, 01/01/25 .................. 1,076,333 1,122,751
8.5%, 02/01/25 .................. 162,665 169,681
8.5%, 03/01/25 .................. 227,120 236,915
8.5%, 04/01/25 .................. 7,361,742 7,679,217
8.5%, 05/01/25 .................. 547,607 571,223
8.5%, 07/01/25 .................. 168,787 176,066
8.5%, 10/01/25 .................. 350,967 366,103
7.978%, 05/01/27 ................ 1,923,022 1,987,925
Government National
Mortgage Association:
8.0%, 06/15/23 .................. 1,092,453 1,137,518
8.0%, 11/15/23 .................. 335,521 349,362
8.0%, 07/15/24 .................. 338,856 352,834
8.0%, 09/15/24 .................. 401,187 417,736
8.0%, 10/15/24 .................. 351,141 365,627
8.0%, 11/15/24 .................. 336,632 350,519
8.0%, 03/15/25 .................. 351,297 365,788
8.0%, 04/15/25 .................. 350,227 364,674
8.0%, 05/15/25 .................. 1,030,733 1,073,251
8.0%, 05/17/25 .................. 703,872 732,908
11.0%, 01/15/10 ................. 271,488 305,086
11.0%, 02/15/10 ................. 838,925 942,748
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES
(Continued):
11.0%, 03/15/10 ................. $ 970,714 $ 1,090,844
11.0%, 04/15/10 ................. 88,062 98,961
11.0%, 05/15/10 ................. 1,723 1,937
11.0%, 06/15/10 ................. 284,991 320,260
11.0%, 07/15/10 ................. 580,569 652,418
11.0%, 08/15/10 ................. 289,092 324,868
11.0%, 09/15/10 ................. 377,531 424,253
-------------
33,927,415
-------------
U.S. GOVERNMENT AGENCIES (27.2%)
Resolution Funding S.T.R.I.P.S.
Zero Coupon Deb., 04/15/99 ..... 5,000,000 4,195,950
U.S. Treasury:
11.875% Bond, 11/15/03 .......... 6,300,000 8,806,221
5.875% Note, 11/15/05 ........... 6,350,000 6,492,875
-------------
19,495,046
-------------
TOTAL CREDIT SENSITIVE (91.7%) . 65,808,890
-------------
TOTAL LONG-TERM DEBT SECURITIES (91.7%)
(Amortized Cost $64,190,415) ... 65,808,890
-------------
SHORT-TERM DEBT SECURITIES:
U.S. GOVERNMENT (14.6%)
Federal Home Loan Mortgage Corp.
5.75%, due 01/02/96 ............. 10,500,000 10,494,969
-------------
TOTAL SHORT-TERM DEBT SECURITIES (14.6%)
(Amortized Cost $10,494,969) ... 10,494,969
-------------
NUMBER OF
CONTRACTS (B)
-------------
OPTIONS PURCHASED:
U.S. 10 Year Treasury Note
February 115 Call * ............. 81 67,078
-------------
TOTAL OPTIONS PURCHASED (0.1%)
(Premiums Paid $38,576) ......... 67,078
-------------
TOTAL INVESTMENTS (106.4%)
(Amortized Cost $74,723,960) ... 76,370,937
LIABILITIES IN EXCESS OF CASH AND
RECEIVABLES (- 6.4%) ............ (4,591,112)
-------------
NET ASSETS (100.0%) .............. $71,779,825
=============
</TABLE>
- ------------
* Non-income producing.
(a) Interest rate shown on floating rate securities represents the rate at
December 31, 1995.
(b) One contract relates to 100 shares.
See Notes to Financial Statements.
11
<PAGE>
THE HUDSON RIVER TRUST
QUALITY BOND PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------- ------------- --------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES:
BUSINESS SERVICES
PRINTING, PUBLISHING &
BROADCASTING (8.3%)
Tele-Communications, Inc.
8.75%, 08/01/15 ............... $ 5,600,000 $ 6,208,552
Time Warner, Inc.
9.15%, 02/01/23 ............... 6,000,000 6,804,240
--------------
TOTAL BUSINESS SERVICES (8.3%) 13,012,792
--------------
CONSUMER NONCYCLICALS (3.5%)
FOODS
Borden, Inc.
Zero Coupon, 05/22/97+ ........ 6,000,000 5,493,000
--------------
CREDIT SENSITIVE
BANKS (3.6%)
St. George Bank Ltd.
7.15%, 10/15/05+ .............. 5,500,000 5,692,830
--------------
FINANCIAL SERVICES (5.7%)
Commercial Credit Co.
6.125%, 12/01/05 .............. 3,155,000 3,124,709
Prudential Insurance
8.3%, 07/01/25+ ............... 5,400,000 5,796,738
--------------
8,921,447
--------------
FOREIGN GOVERNMENT (13.3%)
Deutschland Republic
6.875%, 05/12/05 .............. 8,300,000 6,141,583
Italy Global Bond
6.875%, 09/27/23 .............. 3,000,000 2,929,650
Government of Spain
12.25%, 03/25/00 .............Esp 675,000,000 6,108,746
Province of Quebec
7.5%, 07/15/23 ................ $ 5,500,000 5,765,760
--------------
20,945,739
--------------
MORTGAGE RELATED (8.4%)
Federal National Mortgage
Association
6.0%, 12/01/09 ................ 13,423,998 13,289,759
--------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES (Continued):
UTILITY -- ELECTRIC (3.1%)
GG1B Funding Corp.
7.43%, 01/15/11 ............... $ 4,926,622 $ 4,934,702
--------------
U.S. GOVERNMENT (50.9%)
Federal Farmers Credit
7.64% Medium Term Note,
02/03/98 ...................... 5,000,000 5,223,000
Federal Home Loan Bank
5.725%, 06/15/98 .............. 20,000,000 20,164,000
U.S. Treasury:
5.625% Note, 06/30/97 ......... 13,500,000 13,588,587
7.125% Note, 09/30/99 ......... 24,050,000 25,485,473
6.75% Note, 04/30/00 .......... 13,640,000 14,356,100
6.875% Bond, 08/15/25 ......... 1,170,000 1,319,906
--------------
80,137,066
--------------
TOTAL CREDIT SENSITIVE (85.0%) 133,921,543
--------------
TOTAL LONG-TERM DEBT SECURITIES (96.8%)
(Amortized Cost $148,282,420) 152,427,335
--------------
SHORT-TERM DEBT SECURITIES:
U.S. GOVERNMENT (0.9%)
Federal Home Loan Mortgage
Corp. 5.75%, due 01/02/96 .... 1,400,000 1,399,329
--------------
TOTAL SHORT-TERM DEBT SECURITIES (0.9%)
(Amortized Cost $1,399,329) .. 1,399,329
--------------
TOTAL INVESTMENTS (97.7%)
(Amortized Cost $149,681,749) 153,826,664
CASH AND RECEIVABLES
LESS LIABILITIES (2.3%) ....... 3,616,183
--------------
NET ASSETS (100.0%) ............ $157,442,847
==============
</TABLE>
ESP
- ------------
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
See Notes to Financial Statements.
12
<PAGE>
THE HUDSON RIVER TRUST
HIGH YIELD PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ------------------------------- ------------ -----------
<S> <C> <C>
COMMON STOCKS:
BUSINESS SERVICES (0.0%)
PRINTING, PUBLISHING &
BROADCASTING
Pegasus Media &
Communications--Warrants* .... 150 $ 45,000
-----------
CONSUMER CYCLICALS
APPAREL, TEXTILE (0.0%)
AVI Holdings, Inc.--Warrants*+ 3,300 16,500
-----------
RETAIL--GENERAL (0.0%)
Eye Care Centers of America--
Warrants* ..................... 3,000 30,000
-----------
TOTAL CONSUMER CYCLICALS (0.0%) 46,500
-----------
CONSUMER NONCYCLICALS
HOSPITAL SUPPLIES & SERVICES (0.1%)
Wright Medical Techonolgy,
Inc.--Warrants* ............... 412 67,980
-----------
SOAPS & TOILETRIES (0.1%)
Renaissance Cosmetics--
Warrants*+ .................... 2,000 45,000
-----------
TOTAL CONSUMER NONCYCLICALS (0.2%) 112,980
-----------
TOTAL COMMON STOCKS (0.2%)
(Cost $201,480) ............... 204,480
-----------
PRINCIPAL
AMOUNT
------------
LONG-TERM DEBT SECURITIES:
BASIC MATERIALS
CHEMICALS (7.7%)
Buckeye Cellulos Corp.
8.5%, 12/15/05 ................ $1,000,000 1,032,500
G-I Holdings
Zero Coupon Sr. Disc. Note,
10/01/98 ...................... 2,000,000 1,550,000
Harris Chemical
10.75%, 10/15/03 .............. 2,000,000 1,830,000
Pioneer Americas Corp.
13.375%, 04/01/05 ............. 1,500,000 1,567,500
Sherritt Gordon
9.75%, 04/01/03 ............... 2,000,000 2,130,000
Trans Resources, Inc.
11.875% Sr. Sub. Note Series
B, 07/01/02 ................... 1,000,000 915,000
-----------
9,025,000
-----------
METALS & MINING (4.2%)
Great Lakes Carbon Corp.
10.0%, 01/01/06 ............... 2,000,000 2,050,000
Interlake Corp.
12.0%, 11/15/01 ............... 1,500,000 1,515,000
International Wire Group
11.75%, 06/01/05 .............. 1,500,000 1,440,000
-----------
5,005,000
-----------
PAPER (9.0%)
Crown Paper Co.
11.0%, 09/01/05 ............... 1,500,000 1,312,500
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
<S> <C> <C>
- -------------------------------- ------------ ---------------------------
LONG-TERM DEBT SECURITIES (CONTINUED):
Indah Kiat International Finance
11.875%, 06/15/02 .............. $1,500,000 $ 1,515,000
Rapp International Finance:
11.5%, 12/15/00 ................ 1,500,000 1,492,500
13.25%, 12/15/05 ............... 1,000,000 986,250
Repap New Brunswick
9.875%, 07/15/00 ............... 1,000,000 1,002,500
Sweetheart Cup
10.5%, 09/01/03 ................ 2,250,000 2,266,875
Williamhouse Regency of
Delaware, Inc.
13.0%, 11/15/05+ ............... 2,000,000 2,075,000
---------------------------
10,650,625
---------------------------
STEEL (0.8%)
Algoma Steel
12.375%, 07/15/05 .............. 1,000,000 900,000
---------------------------
TOTAL BASIC MATERIALS (21.7%) . 25,580,625
---------------------------
BUSINESS SERVICES
PRINTING, PUBLISHING &
BROADCASTING (7.7%)
Act III Broadcasting, Inc.
10.25%, 12/15/05 ............... 2,000,000 2,035,000
Continental Cablevision
8.3%, 05/15/06+ ................ 3,000,000 3,011,250
Fundy Cable Ltd.
11.0%, 11/15/05 ................ 2,500,000 2,600,000
Pegasus Media & Communications
12.5%, 07/01/05 ................ 1,500,000 1,485,000
---------------------------
9,131,250
---------------------------
TRUCKING, SHIPPING (4.5%)
Penn Traffic Co.
8.625%, 12/15/03 ............... 2,500,000 2,225,000
Stena AB
10.5%, 12/15/05 ................ 3,000,000 3,060,000
---------------------------
5,285,000
---------------------------
TOTAL BUSINESS SERVICES (12.2%) 14,416,250
---------------------------
CAPITAL GOODS
AEROSPACE (0.9%)
Howmet Corp.
10.0%, 12/01/03+ ............... 1,000,000 1,040,000
---------------------------
MACHINERY (3.0%)
Monarch Acquisition
12.5%, 07/01/03 ................ 1,500,000 1,590,000
Specialty Equipment Cos., Inc.
11.375%, 12/01/03 .............. 2,000,000 2,030,000
---------------------------
3,620,000
---------------------------
TOTAL CAPITAL GOODS (3.9%) .... 4,660,000
---------------------------
CONSUMER CYCLICALS
APPAREL, TEXTILE (6.6%)
Apparel Ventures, Inc.
12.25%, 12/31/00 ............... 900,000 706,500
CMI Industries
9.5%, 10/01/03 ................. 2,000,000 1,620,000
</TABLE>
13
<PAGE>
THE HUDSON RIVER TRUST
HIGH YIELD PORTFOLIO
PORTFOLIO OF INVESTMENTS (CONTINUED)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES (CONTINUED):
Hosiery Corp. of America
14.25%, 08/01/02 (b) ........... $1,500,000 $ 1,612,500
Ithaca Industries
11.125%, 12/15/02 .............. 1,500,000 600,000
PT Polysindo Eka Perkasa
13.0%, 06/01/01 ................ 2,175,000 2,251,125
Tultex Corp.
10.625%, 03/15/05 .............. 1,000,000 1,025,000
-------------
7,815,125
-------------
HOUSEHOLD FURNITURE, APPLIANCES (1.3%)
Crain Industries
13.5%, 08/15/05+ ............... 1,500,000 1,515,000
-------------
LEISURE RELATED (0.9%)
Premier Parks, Inc.
12.0%, 08/15/03+ ............... 1,000,000 1,035,000
-------------
RETAIL--GENERAL (5.4%)
Eye Care Centers of America
12.0%, 10/01/03 ................ 3,000,000 2,790,000
Florist Transworld
14.0%, 12/15/01 (b) ............ 1,500,000 1,635,000
Tag-Heuer International SA
12.0%, 12/15/05+ ............... 2,000,000 2,000,000
-------------
6,425,000
-------------
TOTAL CONSUMER CYCLICALS (14.2%) 16,790,125
-------------
CONSUMER NONCYCLICALS
FOODS (2.9%)
Carr-Gottstein Foods Co.
12.0%, 11/15/05+ ............... 1,500,000 1,515,000
Specialty Foods Corp.
11.125%, 10/01/02 .............. 2,000,000 1,940,000
-------------
3,455,000
-------------
CONTAINERS (2.2%)
MVE, Inc.
12.5%, 02/15/02 ................ 1,500,000 1,500,000
Riverwood International
11.25% Sr. Sub. Deb., 06/15/02 1,000,000 1,085,000
-------------
2,585,000
-------------
SOAPS & TOILETRIES (1.9%)
Revlon Worldwide
Zero Coupon, 03/15/98 .......... 3,000,000 2,227,500
-------------
TOTAL CONSUMER NONCYCLICALS (7.0%) 8,267,500
-------------
CREDIT SENSITIVE
BANKS (1.3%)
Firstbank Puerto Rico
7.625%, 12/15/05 ............... 1,500,000 1,483,125
-------------
FINANCIAL SERVICES (3.2%)
Tembec Finance Corp.
9.875%, 09/30/05 ............... 1,750,000 1,736,875
Trizec Finance Ltd.
10.875%, 10/15/05 .............. 2,000,000 2,050,000
-------------
3,786,875
-------------
GENERAL OBLIGATIONS (1.7%)
Paxson Communications Corp.
11.625%, 10/01/02+ ............. 2,000,000 2,030,000
-------------
FOREIGN GOVERNMENT (3.2%)
Bulgaria Discount Bonds
6.75% Floating Rate Series A,
07/28/24 (a) ................... $2,000,000 $ 1,062,500
Republic of Ecuador
6.813% Floating Rate,
02/28/25 (a) ................... 1,500,000 757,500
Republic of Poland
3.25% Floating Rate,
10/27/14 (a) ................... 3,000,000 1,946,250
-------------
3,766,250
-------------
UTILITY--ELECTRIC (1.3%)
California Energy
9.875%, 06/30/03 ............... 1,500,000 1,575,000
-------------
UTILITY--GAS (1.8%)
Bridas Corp.
12.5%, 11/15/99 ................ 2,100,000 2,079,000
-------------
UTILITY--TELEPHONE (2.5%)
Telewest Communications PLC
9.625%, 10/01/06 ............... 3,000,000 3,030,000
-------------
TOTAL CREDIT SENSITIVE (15.0%) 17,750,250
-------------
ENERGY
OIL--DOMESTIC (3.6%)
Clark USA, Inc.
10.875%, 12/01/05+ ............. 1,500,000 1,575,000
Gulf Canada Resources Ltd.
9.625%, 07/01/05 ............... 1,000,000 1,055,000
Kelley Oil & Gas
13.5%, 06/15/99 ................ 2,000,000 1,600,000
-------------
TOTAL ENERGY (3.6%) ............ 4,230,000
-------------
TECHNOLOGY
OFFICE EQUIPMENT SERVICES (0.9%)
Graphic Controls Corp.
12.0%, 09/15/05 ................ 1,000,000 1,035,000
-------------
TELECOMMUNICATIONS (11.9%)
Clearnet Communications
14.75%, 12/15/05 (b)(c) ........ 4,000,000 2,080,000
Communication & Power Corp.
12.0%, 08/01/05+ ............... 1,000,000 1,027,500
EZ Communications, Inc.
9.75%, 12/01/05 ................ 1,500,000 1,507,500
Fonorola, Inc.
12.5%, 08/15/02 ................ 1,000,000 1,050,000
Galaxy Telecom L.P.
12.375%, 10/01/05 .............. 1,500,000 1,496,250
IXC Communications, Inc.
13.0%, 10/01/05+ ............... 2,000,000 2,145,000
Lenfest Communications
8.375%, 11/01/05 ............... 2,000,000 2,007,500
Nextel Communications
9.75%, 08/15/04 (c) ............ 1,500,000 813,750
Rogers Cablesystems Ltd.
10.0%, 12/01/07 ................ 1,840,000 1,982,600
-------------
14,110,100
-------------
TOTAL TECHNOLOGY (12.8%) ...... 15,145,100
-------------
</TABLE>
14
<PAGE>
THE HUDSON RIVER TRUST
HIGH YIELD PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- --------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES (CONTINUED):
DIVERSIFIED
MISCELLANEOUS (2.4%)
Cabot Safety Corp.
12.5%, 07/15/05 ................ $1,000,000 $ 1,060,000
Jordan Industries
10.375%, 08/01/03 .............. 2,000,000 1,780,000
-------------
TOTAL DIVERSIFIED (2.4%) ...... 2,840,000
-------------
TOTAL LONG-TERM DEBT SECURITIES (92.8%)
(Amortized Cost $107,587,741) . 109,679,850
-------------
SHORT-TERM DEBT SECURITIES:
U.S. GOVERNMENT (2.6%)
Federal Home Loan Mortgage Corp.
5.75%, due 01/02/96 ............ $3,000,000 $ 2,998,563
---------------------------
TOTAL SHORT-TERM DEBT SECURITIES (2.6%)
(Amortized Cost $2,998,563) ... 2,998,563
---------------------------
TOTAL INVESTMENTS (95.6%)
(Cost/Amortized Cost $110,787,784) 112,882,893
CASH AND RECEIVABLES
LESS LIABILITIES (4.4%) ........ 5,245,690
---------------------------
NET ASSETS (100.0%) ............. $118,128,583
===========================
</TABLE>
- ------------
* Non-income producing.
+ Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may only be resold to qualified
institutional buyers.
(a) Interest rate shown on floating rate securities represents the rate at
December 31, 1995.
(b) Consists of more than one class of securities traded together as a
unit; generally bonds with attached stocks or warrants.
(c) Debt security initially issued in zero coupon form which converts to
coupon form at a specific rate and date.
See Notes to Financial Statements.
15
<PAGE>
THE HUDSON RIVER TRUST
GROWTH & INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- ----------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS (1.5%)
Avery Dennison Corp. ............ 15,000 $ 751,875
Dow Chemical Co. ................ 5,000 351,875
Dupont (E.I.) de Nemours & Co. . 5,000 349,375
-----------
TOTAL BASIC MATERIALS (1.5%) .. 1,453,125
-----------
ENVIRONMENTAL CONTROL (1.1%)
Johnson Controls, Inc. .......... 15,000 1,031,250
-----------
PRINTING, PUBLISHING &
BROADCASTING (1.2%)
Jostens, Inc. ................... 50,000 1,212,500
-----------
PROFESSIONAL SERVICES (0.7%)
GATX Corp. ...................... 15,000 729,375
-----------
TOTAL BUSINESS SERVICES (3.0%) 2,973,125
-----------
CAPITAL GOODS
AEROSPACE (1.0%)
Northrop Grumman Corp. .......... 15,000 960,000
-----------
BUILDING MATERIALS &
FOREST PRODUCTS (1.8%)
Weyerhaeuser Co. ................ 40,000 1,730,000
-----------
ELECTRICAL EQUIPMENT (1.5%)
General Electric Co. ............ 20,000 1,440,000
-----------
MACHINERY (1.0%)
Deere & Co. ..................... 30,000 1,057,500
-----------
TOTAL CAPITAL GOODS (5.3%) .... 5,187,500
-----------
CONSUMER CYCLICALS
AUTO RELATED (1.0%)
Dana Corp. ...................... 35,000 1,023,750
-----------
RETAIL--GENERAL (0.8%)
Sears Roebuck & Co. ............. 20,000 780,000
-----------
TOTAL CONSUMER CYCLICALS (1.8%) 1,803,750
-----------
CONSUMER NONCYCLICALS
FOODS (2.0%)
Heinz (H.J.) Co. ................ 60,000 1,987,500
-----------
DRUGS (2.2%)
Bristol-Myers Squibb Co. ........ 25,000 2,146,875
-----------
HOSPITAL SUPPLIES & SERVICES (1.5%)
Baxter International, Inc. ..... 35,000 1,465,625
-----------
RETAIL--FOOD (0.4%)
Kroger Co.* ..................... 9,574 359,025
-----------
SOAPS & TOILETRIES (1.8%)
Clorox Co. ...................... 25,000 1,790,625
-----------
TOBACCO (2.8%)
Philip Morris Cos., Inc. ........ 25,000 2,262,500
UST, Inc. ....................... 15,000 500,625
-----------
2,763,125
-------------
TOTAL CONSUMER NONCYCLICALS (10.7%) 10,512,775
-------------
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- -----------
<S> <C> <C>
COMMON STOCKS (Continued):
CREDIT SENSITIVE
BANKS (4.0%)
Bank of New York Co. ............ 45,000 $ 2,193,750
First Bank Systems .............. 35,000 1,736,875
-----------
3,930,625
-----------
FINANCIAL SERVICES (2.3%)
American Express Co. ............ 40,000 1,655,000
MBNA Corp. ...................... 15,000 553,125
-----------
2,208,125
-----------
INSURANCE (0.6%)
Saint Paul Cos., Inc. ........... 10,000 556,250
-----------
UTILITY--ELECTRIC (5.4%)
Duke Power Co. .................. 30,000 1,421,250
Houston Industries, Inc. ........ 60,000 1,455,000
Portland General Corp. .......... 30,000 873,750
Teco Energy, Inc. ............... 60,000 1,537,500
-----------
5,287,500
-----------
UTILITY--GAS (1.9%)
Consolidated Natural Gas Co. ... 40,000 1,815,000
-----------
UTILITY--TELEPHONE (6.3%)
Ameritech Corp. ................. 35,000 2,065,000
Cincinnati Bell, Inc. ........... 60,000 2,085,000
NYNEX Corp. ..................... 40,000 2,160,000
-----------
6,310,000
-----------
TOTAL CREDIT SENSITIVE (20.5%) 20,107,500
-----------
ENERGY
COAL & GAS PIPELINES (2.5%)
MCN CORP. 50,000 1,162,500
WILLIAMS COS., INC. 30,000 1,316,250
-----------
2,478,750
-----------
OIL--INTERNATIONAL (3.9%)
Exxon Corp. ..................... 20,000 1,602,500
Mobil Corp. ..................... 20,000 2,240,000
-----------
3,842,500
-----------
OIL--SUPPLIES & CONSTRUCTION (0.5%)
Halliburton Co. ................. 10,000 506,250
-----------
RAILROADS (2.4%)
Burlington Northern Santa Fe ... 4,148 323,544
Norfolk Southern Corp. .......... 25,000 1,984,375
-----------
2,307,919
-----------
TOTAL ENERGY (9.3%) ............ 9,135,419
-----------
TECHNOLOGY
OFFICE EQUIPMENT (2.1%)
Xerox Corp. ..................... 15,000 2,055,000
-----------
ELECTRONICS (0.5%)
National Semiconductor Corp.* .. 19,223 427,712
-----------
TOTAL TECHNOLOGY (2.6%) ........ 2,482,712
-------------
TOTAL COMMON STOCKS (54.7%)
(Cost $45,015,363) ............. 53,655,906
--------------
</TABLE>
16
<PAGE>
THE HUDSON RIVER TRUST
GROWTH & INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- -----------
<S> <C> <C>
PREFERRED STOCKS:
BASIC MATERIALS
METALS & MINING (0.3%)
Reynolds Metals Co.
7.0% Conv., 12/31/97 ........... 5,300 $ 268,312
-----------
PAPER (0.1%)
James River Corp.
9.0% Conv. ..................... 6,600 154,275
-----------
TOTAL BASIC MATERIALS (0.4%) .. 422,587
-----------
BUSINESS SERVICES (0.4%)
PRINTING, PUBLISHING &
BROADCASTING
Cablevision Systems
8.5% Conv. ..................... 12,900 351,525
-----------
CAPITAL GOODS (0.7%)
ELECTRICAL EQUIPMENT
Westinghouse Electric Corp.
1.3% Conv. *+ .................. 40,400 641,350
-----------
CONSUMER CYCLICALS (0.5%)
AIRLINES
Continental Air Finance Trust
8.5% Conv.*+ ................... 9,000 481,500
-----------
CONSUMER NONCYCLICALS
DRUGS (0.0%)
Gensia Pharmaceuticals, Inc.
$3.75 Conv. + .................. 1,800 26,100
-----------
HOSPITAL SUPPLIES & SERVICES (0.5%)
FHP International Corp.
5.0% Conv. Series A ............ 15,900 423,338
-----------
TOTAL CONSUMER NONCYCLICALS (0.5%) 449,438
-----------
CREDIT SENSITIVE
BANKS (0.9%)
First Chicago NBD Corp.
5.75% Conv. Series B ........... 7,600 509,200
Jefferson-Pilot Corp.
7.25% Conv. .................... 4,600 336,375
-----------
845,575
-----------
FINANCIAL SERVICES (0.5%)
Allstate Corp.
$2.30 Conv. .................... 7,000 287,000
First USA, Inc.
6.25% Conv. .................... 5,500 217,250
-----------
504,250
-----------
INSURANCE (0.4%)
Travelers Group, Inc.
5.5% Conv. Series B ............ 4,400 383,900
-----------
UTILITY--TELEPHONE (0.7%)
LCI International
5.0% Conv. ..................... 12,800 684,800
-----------
TOTAL CREDIT SENSITIVE (2.5%) . 2,418,525
-----------
ENERGY (0.3%)
OIL--DOMESTIC
ENRON Corp.
6.25% Conv.* ................... 14,700 352,800
-----------
PREFERRED STOCKS (Continued):
TECHNOLOGY (0.3%)
TELECOMMUNICATIONS
MFS Communications Co., Inc.
8.0% Conv.* .................... 7,200 $ 350,550
-----------
TOTAL PREFERRED STOCKS (5.6%)
(Cost $5,100,065) .............. 5,468,275
-----------
<PAGE>
PRINCIPAL
AMOUNT
LONG-TERM DEBT SECURITIES:
BUSINESS SERVICES
ENVIRONMENTAL CONTROL (1.2%)
Thermo Electron Corp.:
5.0% Euro Conv., 04/15/01 ..... $500,000 846,250
4.25% Euro Conv., 01/01/03+ ... 300,000 328,125
-----------
1,174,375
-----------
PROFESSIONAL SERVICES (2.0%)
Career Horizons, Inc.
7.0% Conv., 11/01/02+ .......... 280,000 318,500
Danka Business Systems
6.75% Conv., 04/01/02 .......... 470,000 665,638
First Financial Management Corp.
5.0% Conv., 12/15/99 ........... 605,000 981,613
-----------
1,965,751
-----------
TOTAL BUSINESS SERVICES (3.2%) 3,140,126
-----------
CAPITAL GOODS
MACHINERY (1.6%)
Dovatron International
6.0% Conv., 10/15/02+ ......... 300,000 321,000
Solectron Corp.
Zero Coupon Conv. Sub. Note,
05/05/12 ....................... 930,000 853,274
Titan Wheel International, Inc.
4.75% Conv., 12/01/00 .......... 315,000 416,194
-----------
TOTAL CAPITAL GOODS (1.6%) .... 1,590,468
-----------
CONSUMER CYCLICALS
FOOD SERVICES, LODGING (0.8%)
HFS, INC.
4.5% CONV., 10/01/99 365,000 843,150
--------------
RETAIL--GENERAL (0.9%)
Federated Department Stores,
Inc.
5.0% Conv., 10/01/03 ........... 375,000 375,000
Lowes Cos., Inc.
3.0% Conv., 07/22/03 ........... 380,000 495,425
-----------
870,425
-----------
TOTAL CONSUMER CYCLICALS (1.7%) 1,713,575
-----------
CONSUMER NONCYCLICALS
HOSPITAL SUPPLIES & SERVICES (2.0%)
Healthsouth Corp.
5.0% Conv., 04/01/01 ........... 390,000 629,850
Integrated Health Services, Inc.
5.75% Conv., 01/01/01+ ......... 735,000 739,593
Omnicare, Inc.
5.75% Conv., 10/01/03 .......... 205,000 636,013
-----------
TOTAL CONSUMER NONCYCLICALS (2.0%) 2,005,456
-----------
</TABLE>
17
<PAGE>
THE HUDSON RIVER TRUST
GROWTH & INCOME PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ---------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES (Continued):
CREDIT SENSITIVE
BANKS (0.3%)
Bank of New York Co.
7.5% Conv., 08/15/01 ............. $ 135,000 $ 336,656
---------------
FINANCIAL SERVICES (0.7%)
Medaphis Corp.
6.5% Conv., 01/01/00+ ............ 241,000 640,759
---------------
UTILITY--TELEPHONE (1.0%)
Worldcom, Inc.
5.0% Conv., 08/15/03 ............. 895,000 948,700
-------------
TOTAL CREDIT SENSITIVE (2.0%) ... 1,926,115
-------------
TECHNOLOGY
ELECTRONICS (4.1%)
Altera Corp.
5.75% Conv. Sub. Note, 06/15/02+ 405,000 471,825
Cypress Semiconductor
3.15% Conv., 03/15/01+ ........... 285,000 289,988
General Instrument Corp.
5.0% Conv., 06/15/00 ............. 290,000 322,625
Integrated Device Technology, Inc.
5.5% Conv., 06/01/02 ............. 550,000 449,625
Lam Research Corp.
6.0% Conv. Sub. Deb., 05/01/03 .. 300,000 557,250
LSI Logic Corp.
5.5% Conv., 03/15/01+ ............ 125,000 339,219
Motorola, Inc.
Zero Coupon Conv., 09/27/13 ..... 150,000 114,375
Sanmina Corporation
5.5% Conv., 08/15/02+ ............ 625,000 683,594
3Com Corp.
10.25% Conv., 11/01/01+ .......... 495,000 790,763
-------------
4,019,264
-------------
<PAGE>
LONG-TERM DEBT SECURITIES (Continued):
TELECOMMUNICATIONS (1.9%)
Intelcom Group, Inc.
7.0% Conv., 10/30/98 ............. $ 387,000 $ 332,820
Bay Networks, Inc.
5.25% Conv., 05/15/03+ ........... 720,000 779,400
U.S. Cellular Corp.
Zero Coupon Conv., 06/15/15 ..... 2,035,000 717,336
-------------
1,829,556
-------------
TOTAL TECHNOLOGY (6.0%) .......... 5,848,820
-------------
TOTAL LONG-TERM DEBT SECURITIES (16.5%)
(Amortized Cost $14,124,662) .... 16,224,560
-------------
SHORT-TERM DEBT SECURITIES:
U.S. GOVERNMENT (22.7%)
Federal Home Loan Bank
5.54%, due 01/03/96 .............. 13,600,000 13,591,628
Federal Home Loan Mortgage Corp.
5.75%, due 01/02/96 .............. 8,600,000 8,595,879
-------------
TOTAL U.S. GOVERNMENT (22.7%) ... 22,187,507
-------------
TOTAL SHORT-TERM DEBT SECURITIES (22.7%)
(Amortized Cost $22,187,507) .... 22,187,507
-------------
TOTAL INVESTMENTS (99.5%)
(Cost/Amortized Cost $86,427,597) 97,536,248
CASH AND RECEIVABLES
LESS LIABILITIES (0.5%) .......... 516,573
-------------
NET ASSETS (100.0%) ............... $98,052,821
=============
</TABLE>
- ------------
* Non-income producing.
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
See Notes to Financial Statements.
18
<PAGE>
THE HUDSON RIVER TRUST
EQUITY INDEX PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ---------------------------------- ------------ --------------------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS (2.4%)
Air Products & Chemicals, Inc. ... 3,800 $ 200,450
Avery Dennison Corp. .............. 1,800 90,225
Dow Chemical Co. .................. 9,200 647,450
Dupont (E.I.) de Nemours & Co. ... 19,000 1,327,625
Eastman Chemical Company .......... 2,800 175,350
Ecolab, Inc. ...................... 2,500 75,000
FMC Corp.* ........................ 1,200 81,150
Goodrich (B.F.) Co. ............... 1,200 81,750
Grace (W.R.) & Co. ................ 3,200 189,200
Hercules, Inc. .................... 3,800 214,225
Millipore Corp. ................... 2,000 82,250
Monsanto Co. ...................... 4,000 490,000
Nalco Chemical Co. ................ 2,700 81,338
Rohm & Haas Co. ................... 2,300 148,062
Union Carbide Corp. ............... 4,500 168,750
--------------------------
4,052,825
--------------------------
CHEMICALS--SPECIALTY (0.3%)
Great Lakes Chemical Corp. ........ 2,200 158,400
Morton International, Inc. ........ 4,800 172,200
Raychem Corp. ..................... 1,500 85,312
Sigma Aldrich ..................... 1,700 84,150
--------------------------
500,062
--------------------------
METALS & MINING (1.3%)
Alcan Aluminium Ltd. .............. 7,800 242,775
Aluminum Co. of America ........... 6,200 327,825
Asarco, Inc. ...................... 2,100 67,200
Barrick Gold Corp. ................ 11,700 308,588
Cyprus Amax Minerals Co. .......... 3,000 78,375
Engelhard Corp. ................... 4,950 107,663
Freeport-McMoRan Copper & Gold,
Inc. (Class B) ................... 7,000 196,875
Homestake Mining Co. .............. 4,100 64,063
Inco Ltd. ......................... 4,100 136,325
Newmont Mining Corp. .............. 2,948 133,397
Phelps Dodge Corp. ................ 2,300 143,175
Placer Dome, Inc. ................. 7,900 190,587
Reynolds Metals Co. ............... 2,100 118,912
Santa Fe Pacific Gold Corp. ...... 5,920 71,780
--------------------------
2,187,540
--------------------------
PAPER (1.4%)
Boise Cascade Corp. ............... 2,300 79,637
Champion International Corp. ..... 3,300 138,600
Federal Paper Board, Inc. ......... 1,400 72,625
Georgia Pacific Corp. ............. 3,000 205,875
International Paper Co. ........... 8,700 329,512
James River Corp. ................. 2,800 67,550
Kimberly Clark Corp. .............. 9,322 771,395
Mead Corp. ........................ 1,800 94,050
Moore Corp. Ltd. .................. 4,400 81,950
Stone Container Corp. ............. 5,500 79,063
Temple Inland, Inc. ............... 1,900 83,838
Union Camp Corp. .................. 2,300 109,538
Westvaco Corp. .................... 3,300 91,575
Willamette Industries, Inc. ...... 1,800 101,250
--------------------------
2,306,458
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ---------------------------------- ------------ --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
--------------------------
STEEL (0.3%)
Bethlehem Steel Corp.* ............ 5,800 $ 81,200
Nucor Corp. ....................... 3,000 171,375
USX-U.S. Steel Group .............. 2,900 89,175
Worthington Industries, Inc. ..... 4,100 85,331
--------------------------
427,081
--------------------------
TOTAL BASIC MATERIALS (5.7%) .... 9,473,966
--------------------------
BUSINESS SERVICES
ENVIRONMENTAL CONTROL (0.5%)
Browning-Ferris Industries, Inc. . 7,300 215,350
Johnson Controls, Inc. ............ 1,300 89,375
WMX Technologies, Inc. ............ 16,600 495,925
--------------------------
800,650
--------------------------
PRINTING, PUBLISHING &
BROADCASTING (2.5%)
Capital Cities ABC, Inc. .......... 5,300 653,887
Comcast Corp. (Class A) SPL ...... 8,200 149,137
Deluxe Corp. ...................... 2,800 81,200
Donnelley (R.R.) & Sons Co. ...... 5,300 208,687
Dow Jones & Co., Inc. ............. 3,300 131,588
Dun & Bradstreet Corp. ............ 5,800 375,550
Gannett Co. ....................... 4,800 294,600
Jostens, Inc. ..................... 2,892 70,131
King World Productions, Inc.* .... 1,800 69,975
Knight-Ridder, Inc. ............... 1,600 100,000
McGraw-Hill Companies, Inc. ...... 1,700 148,113
New York Times Co. ................ 3,300 97,763
Tele-Communications, Inc.
(Class A)* ....................... 22,400 445,200
Time Warner, Inc. ................. 13,200 499,950
Times Mirror Co. (Class A) ........ 3,600 121,950
Tribune Co. ....................... 2,200 134,475
Viacom, Inc. (Class A)* ........... 1,000 45,875
Viacom, Inc. (Class B)* ........... 11,400 540,075
--------------------------
4,168,156
--------------------------
PROFESSIONAL SERVICES (0.2%)
Block (H&R), Inc. ................. 3,400 137,700
Interpublic Group Cos., Inc. ..... 2,400 104,100
Service Corp. International ...... 3,400 149,600
--------------------------
391,400
--------------------------
TRUCKING, SHIPPING (0.2%)
Federal Express Corp.* ............ 2,000 147,750
Laidlaw, Inc. (Class B) ........... 3,300 33,825
Roadway Services, Inc. ............ 1,600 78,200
Ryder System, Inc. ................ 3,300 81,675
--------------------------
341,450
--------------------------
TOTAL BUSINESS SERVICES (3.4%) ... 5,701,656
--------------------------
CAPITAL GOODS
AEROSPACE (2.2%)
Boeing Co. ........................ 11,600 909,150
General Dynamics Corp. ............ 2,000 118,250
Lockheed Martin Corporation ...... 6,804 537,516
Loral Corp. ....................... 5,800 205,175
McDonnell Douglas Corp. ........... 3,800 349,600
Northrop Grumman Corp. ............ 1,700 108,800
Raytheon Co. ...................... 8,300 392,175
</TABLE>
19
<PAGE>
THE HUDSON RIVER TRUST
EQUITY INDEX PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ---------------------------------- ------------ --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Rockwell International Corp. ..... 7,400 $ 391,275
TRW, Inc. ......................... 2,100 162,750
United Technologies Corp. ......... 4,200 398,475
--------------------------
3,573,166
--------------------------
BUILDING & CONSTRUCTION (0.0%)
Centex Corp. ...................... 1,900 66,025
--------------------------
BUILDING MATERIALS & FOREST
PRODUCTS (0.7%)
Armstrong World Industries, Inc. . 1,100 68,200
Crane Co. ......................... 2,100 77,437
Louisiana Pacific Corp. ........... 3,700 89,725
Masco Corp. ....................... 5,200 163,150
Owens Corning Fiberglass Corp. ... 1,700 76,288
PPG Industries, Inc. .............. 7,000 320,250
Sherwin Williams Co. .............. 2,600 105,950
Weyerhaeuser Co. .................. 6,900 298,425
--------------------------
1,199,425
--------------------------
ELECTRICAL EQUIPMENT (3.1%)
Emerson Electric Co. .............. 7,700 629,475
General Electric Co. .............. 57,700 4,154,400
Grainger (W.W.), Inc. ............. 1,700 112,625
Thomas & Betts Corp. .............. 1,100 81,125
Westinghouse Electric Corp. ...... 13,400 221,100
--------------------------
5,198,725
--------------------------
MACHINERY (1.4%)
Caterpillar, Inc. ................. 6,800 399,500
Cooper Industries, Inc. ........... 3,700 135,975
Cummins Engine, Inc. .............. 1,800 66,600
Deere & Co. ....................... 8,900 313,725
Dover Corp. ....................... 3,900 143,812
Fluor Corp. ....................... 2,700 178,200
Foster Wheeler Corp. .............. 1,800 76,500
General Signal Corp. .............. 2,400 77,700
Harnischfeger Industries Corp. ... 2,400 79,800
Illinois Tool Works, Inc. ......... 4,000 236,000
Ingersoll Rand Co. ................ 3,500 122,938
Pall Corp. ........................ 3,900 104,813
Parker Hannifin Corp. ............. 2,500 85,625
Timken Co. ........................ 2,000 76,500
Varity Corp.* ..................... 2,000 74,250
--------------------------
2,171,938
--------------------------
TOTAL CAPITAL GOODS (7.4%) ...... 12,209,279
--------------------------
CONSUMER CYCLICALS
AIRLINES (0.3%)
AMR Corp.* ........................ 2,700 200,475
Delta Air Lines, Inc. ............. 1,800 132,975
Southwest Airlines Co. ............ 4,600 106,950
--------------------------
440,400
--------------------------
APPAREL, TEXTILE (0.5%)
Fruit of the Loom, Inc.* .......... 3,200 78,000
Liz Claiborne, Inc. ............... 2,600 72,150
National Service Industries, Inc. 2,400 77,700
Nike, Inc. ........................ 4,700 327,237
Reebok International, Ltd. ........ 2,900 81,925
Russell Corp. ..................... 2,600 $ 72,150
VF Corp. .......................... 2,000 105,500
--------------------------
814,662
--------------------------
AUTO RELATED (0.5%)
Cooper Tire & Rubber Co. .......... 2,600 64,025
Dana Corp. ........................ 3,400 99,450
Eaton Corp. ....................... 2,500 134,062
Echlin, Inc. ...................... 2,100 76,650
Genuine Parts Co. ................. 4,200 172,200
Goodyear Tire & Rubber Co. ........ 5,100 231,413
Snap-On Tools Corp. ............... 1,800 81,450
--------------------------
859,250
--------------------------
AUTOS & TRUCKS (1.9%)
Chrysler Corp. .................... 13,000 719,875
Ford Motor Co. .................... 36,400 1,055,600
General Motors Corp. .............. 25,400 1,343,025
Paccar, Inc. ...................... 1,700 71,613
--------------------------
3,190,113
--------------------------
FOOD SERVICES, LODGING (0.8%)
Harrah's Entertainment, Inc.* .... 3,500 84,875
Marriott International, Inc. ..... 4,200 160,650
McDonald's Corp. .................. 24,000 1,083,000
Wendy's International, Inc. ...... 3,300 70,125
--------------------------
1,398,650
--------------------------
HOUSEHOLD FURNITURE, APPLIANCES (0.4%)
Black & Decker Corp. .............. 2,500 88,125
Maytag Corp. ...................... 3,700 74,925
Newell Co. ........................ 4,900 126,787
Premark International, Inc. ...... 2,100 106,313
Rubbermaid, Inc. .................. 5,500 140,250
Stanley Works ..................... 1,400 72,100
Whirlpool Corp. ................... 2,400 127,800
Zenith Electronics Corp.* ......... 1,205 8,284
--------------------------
744,584
--------------------------
LEISURE RELATED (1.5%)
American Greetings Corp. .......... 2,800 77,350
Brunswick Corp. ................... 3,600 86,400
CUC International, Inc.* .......... 5,700 194,513
Disney (Walt) Co. ................. 17,500 1,032,500
Fleetwood Enterprises, Inc. ...... 2,900 74,675
Hasbro, Inc. ...................... 3,000 93,000
Hilton Hotels Corp. ............... 1,500 92,250
ITT Corp. ......................... 4,000 212,000
Mattel, Inc. ...................... 7,675 236,006
U.S. West Media Group* ............ 16,100 305,900
--------------------------
2,404,594
--------------------------
PHOTO & OPTICAL (0.6%)
Allergan, Inc. .................... 2,300 74,750
Bausch & Lomb, Inc. ............... 2,000 79,250
Eastman Kodak Co. ................. 11,600 777,200
Polaroid Corp. .................... 1,500 71,062
--------------------------
1,002,262
--------------------------
RETAIL--GENERAL (3.9%)
Charming Shoppes, Inc. . ........... 3,600 10,350
Circuit City Stores, Inc. ......... 3,300 91,163
</TABLE>
20
<PAGE>
THE HUDSON RIVER TRUST
EQUITY INDEX PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ---------------------------------- ------------ --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Dayton Hudson Corp. ............... 2,500 $ 187,500
Dillard Department Stores ......... 3,700 105,450
Federated Department Stores, Inc.* 6,900 189,750
Gap, Inc. ......................... 4,900 205,800
Harcourt General, Inc. ............ 2,500 104,688
Home Depot, Inc. .................. 16,400 785,150
K-Mart Corp. ...................... 13,200 95,700
Limited, Inc. ..................... 12,300 213,712
Lowes Cos., Inc. .................. 5,500 184,250
May Department Stores Co. ......... 8,500 359,125
Melville Corp. .................... 3,600 110,700
Mercantile Stores, Inc. ........... 1,700 78,625
Nordstrom, Inc. ................... 2,700 109,350
Penney (J.C.), Inc. ............... 7,800 371,475
Pep Boys Manny, Moe & Jack ........ 3,100 79,438
Price/Costco, Inc.* ............... 6,700 102,175
Rite Aid Corp. .................... 2,900 99,325
Sears Roebuck & Co. ............... 13,400 522,600
Tandy Corp. ....................... 2,100 87,150
Toys R Us, Inc.* .................. 9,500 206,625
Wal-Mart Stores, Inc. ............. 78,900 1,765,387
Walgreen Co. ...................... 8,500 253,937
Woolworth Corp. ................... 5,500 71,500
--------------------------
6,390,925
--------------------------
TOTAL CONSUMER CYCLICALS (10.4%) 17,245,440
--------------------------
CONSUMER NONCYCLICALS
BEVERAGES (3.5%)
Anheuser Busch, Inc. .............. 8,900 595,188
Brown Forman Corp. (Class B) ..... 2,400 87,600
Coca-Cola Co. ..................... 43,000 3,192,750
Pepsico, Inc. ..................... 27,000 1,508,625
Seagram Ltd. ...................... 13,000 450,125
--------------------------
5,834,288
--------------------------
CONTAINERS (0.1%)
Bemis, Inc. ....................... 3,100 79,438
Crown Cork & Seal, Inc.* .......... 2,800 116,900
--------------------------
196,338
--------------------------
FOODS (2.7%)
Archer Daniels Midland Co. ........ 18,566 334,188
Campbell Soup Co. ................. 8,600 516,000
ConAgra, Inc. ..................... 8,400 346,500
CPC International, Inc. ........... 5,000 343,125
Darden Restaurants, Inc. .......... 6,700 79,562
General Mills, Inc. ............... 5,400 311,850
Heinz (H.J.) Co. .................. 12,550 415,719
Hershey Foods Corp. ............... 2,700 175,500
Kellogg Co. ....................... 7,500 579,375
Pioneer Hi Bred
International, Inc. .............. 2,900 161,313
Quaker Oats Co. ................... 4,600 158,700
Ralston Purina Group .............. 3,600 224,550
Sara Lee Corp. .................... 16,500 525,937
Whitman Corp. ..................... 3,600 83,700
Wrigley (Wm.), Jr. Co. ............ 3,800 199,500
--------------------------
4,455,519
--------------------------
DRUGS (6.1%)
ALZA Corp. (Class A)* ............. 3,200 $ 79,200
American Home Products Corp. ..... 10,600 1,028,200
Amgen, Inc.* ...................... 9,000 534,375
Bristol-Myers Squibb Co. .......... 17,300 1,485,637
Lilly (Eli) & Co. ................. 20,000 1,125,000
Merck & Co., Inc. ................. 42,200 2,774,650
Pfizer, Inc. ...................... 21,400 1,348,200
Pharmacia & Upjohn, Inc. .......... 17,090 662,238
Schering Plough Corp. ............. 12,600 689,850
Warner-Lambert Co. ................ 4,600 446,775
--------------------------
10,174,125
--------------------------
HOSPITAL SUPPLIES & SERVICES (3.9%)
Abbott Laboratories, Inc. ......... 27,100 1,131,425
Bard (C.R.), Inc. ................. 2,400 77,400
Baxter International, Inc. ........ 9,400 393,625
Becton Dickinson & Co. ............ 2,200 165,000
Beverly Enterprises, Inc.* ........ 6,400 68,000
Biomet, Inc. ...................... 4,200 75,075
Boston Scientific Corp.* .......... 5,500 269,500
Columbia/HCA Healthcare Corp. .... 15,100 766,325
Humana, Inc.* ..................... 5,500 150,563
Johnson and Johnson ............... 22,000 1,883,750
Mallinckrodt, Inc. ................ 2,600 94,575
Manor Care, Inc. .................. 2,200 77,000
Medtronic, Inc. ................... 7,900 441,412
Saint Jude Medical, Inc.* ......... 2,250 96,750
Tenet Healthcare Corporation* .... 6,800 141,100
United Healthcare Corp. ........... 5,900 386,450
U.S. Healthcare, Inc. ............. 5,200 241,800
--------------------------
6,459,750
--------------------------
RETAIL--FOOD (0.7%)
Albertsons, Inc. .................. 8,700 286,012
American Stores Co. ............... 4,800 128,400
Giant Food, Inc. (Class A) ........ 2,400 75,600
Kroger Co.* ....................... 4,000 150,000
Supervalu, Inc. ................... 2,400 75,600
Sysco Corp. ....................... 6,300 204,750
Winn Dixie Stores, Inc. ........... 5,200 191,750
--------------------------
1,112,112
--------------------------
SOAPS & TOILETRIES (2.6%)
Avon Products, Inc. ............... 2,400 180,900
Clorox Co. ........................ 1,700 121,763
Colgate Palmolive Co. ............. 4,800 337,200
Gillette Corp. .................... 15,300 797,512
International Flavors &
Fragrances, Inc. ................. 3,800 182,400
Procter & Gamble Co. .............. 23,700 1,967,100
Unilever N.V. ..................... 5,500 774,125
--------------------------
4,361,000
--------------------------
TOBACCO (2.1%)
American Brands, Inc. ............. 6,600 294,525
Loews Corp. ....................... 4,100 321,338
</TABLE>
21
<PAGE>
THE HUDSON RIVER TRUST
EQUITY INDEX PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ---------------------------------- ------------ --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Philip Morris Cos., Inc. .......... 29,100 $ 2,633,550
UST, Inc. ......................... 6,500 216,937
--------------------------
3,466,350
--------------------------
TOTAL CONSUMER NONCYCLICALS (21.7%) 36,059,482
--------------------------
CREDIT SENSITIVE
BANKS (6.2%)
Ahmanson (H.F.) & Co. ............. 4,000 106,000
Banc One Corp. .................... 13,500 509,625
Bank of Boston Corp. .............. 3,800 175,750
Bank of New York Co. .............. 6,600 321,750
BankAmerica Corp. ................. 12,800 828,800
Bankers Trust New York Corp. ..... 2,700 179,550
Barnett Banks, Inc. ............... 3,200 188,800
Boatmen's Bancshares, Inc. ........ 4,100 167,588
Chase Manhattan Corp. ............. 6,000 363,750
Chemical Banking Corp. ............ 8,600 505,250
Citicorp .......................... 14,500 975,125
Comerica, Inc. .................... 3,900 156,487
CoreStates Financial Corp. ........ 4,800 181,800
First Bank Systems ................ 4,600 228,275
First Chicago NBD Corp. ........... 10,849 428,535
First Fidelity BankCorp. .......... 2,700 203,513
First Interstate Bancorp. ......... 2,600 354,900
First Union Corp. ................. 5,900 328,188
Golden West Financial Corp. ...... 2,000 110,500
Great Western Financial Corp. .... 4,600 117,300
KeyCorp. .......................... 7,800 282,750
Mellon Bank Corp. ................. 5,000 268,750
Morgan (J.P.) & Co., Inc. ......... 6,400 513,600
National City Corp. ............... 4,800 159,000
NationsBank Corp. ................. 9,300 647,513
Norwest Corp. ..................... 12,100 399,300
PNC Bank Corp. .................... 11,800 380,550
Republic New York Corp. ........... 1,800 111,825
Suntrust Banks, Inc. .............. 3,900 267,150
U.S. Bancorp. ..................... 5,100 171,487
Wachovia Corp. .................... 5,900 269,925
Wells Fargo & Co. ................. 1,600 345,600
--------------------------
10,248,936
--------------------------
FINANCIAL SERVICES (1.6%)
American Express Co. .............. 16,700 690,963
Beneficial Corp. .................. 1,800 83,925
Dean Witter Discover & Co. ........ 5,800 272,600
Fleet Financial Group, Inc. ...... 8,779 357,744
Household International, Inc. .... 3,300 195,113
MBNA Corp. ........................ 5,100 188,063
Merrill Lynch & Co., Inc. ......... 6,000 306,000
Morgan Stanley Group, Inc. ........ 2,600 209,625
Salomon, Inc. ..................... 3,500 124,250
Transamerica Corp. ................ 2,300 167,612
--------------------------
2,595,895
--------------------------
INSURANCE (3.5%)
Aetna Life & Casualty Co. ......... 3,900 270,075
Alexander & Alexander
Services, Inc. ................... 3,700 70,300
Allstate Corp. .................... 15,238 $ 626,663
American General Corp. ............ 7,000 244,125
American International
Group, Inc. ...................... 16,150 1,493,875
Chubb Corp. ....................... 3,000 290,250
CIGNA Corp. ....................... 2,500 258,125
General Re Corp. .................. 2,800 434,000
ITT Hartford Group, Inc. .......... 4,000 193,500
Jefferson-Pilot Corp. ............. 2,400 111,600
Lincoln National Corp. Industries 3,400 182,750
Marsh & McLennan Cos., Inc. ...... 2,400 213,000
Providian Corp. ................... 3,100 126,325
Safeco Corp. ...................... 4,300 148,350
Saint Paul Cos., Inc. ............. 2,900 161,313
Torchmark Corp. ................... 2,300 104,075
Travelers Group, Inc. ............. 10,900 685,337
UNUM Corp. ........................ 2,500 137,500
USF&G Corp. ....................... 4,600 77,625
--------------------------
5,828,788
--------------------------
MORTGAGE RELATED (1.0%)
Federal Home Loan
Mortgage Corp. ................... 6,200 517,700
Federal National Mortgage
Association ...................... 9,300 1,154,362
--------------------------
1,672,062
--------------------------
UTILITY--ELECTRIC (3.5%)
American Electric Power, Inc. .... 6,300 255,150
Baltimore Gas & Electric Co. ..... 5,000 142,500
Carolina Power & Light Co. ........ 5,300 182,850
Central & South West Corp. ........ 6,500 181,188
Cinergy Corp. ..................... 5,113 156,586
Consolidated Edison Co.
N.Y., Inc. ....................... 8,000 256,000
Detroit Edison Co. ................ 5,000 172,500
Dominion Resources, Inc. .......... 5,900 243,375
Duke Power Co. .................... 7,000 331,625
Entergy Corp. ..................... 7,800 228,150
FPL Group, Inc. ................... 6,300 292,162
General Public Utilities Corp. ... 3,800 129,200
Houston Industries, Inc. .......... 9,000 218,250
Niagara Mohawk Power Co. .......... 7,900 76,037
Northern States Power Co. ......... 2,300 112,987
Ohio Edison Co. ................... 5,200 122,200
Pacific Gas & Electric Co. ........ 14,500 411,438
Pacificorp. ....................... 9,700 206,125
Peco Energy Co. ................... 7,600 228,950
PP&L Resources, Inc. .............. 5,900 147,500
Public Service Enterprise Group .. 8,400 257,250
SCE Corp. ......................... 15,200 269,800
Southern Co. ...................... 22,700 558,988
Texas Utilities Co. ............... 7,700 316,662
Unicom Corporation ................ 7,300 239,075
Union Electric Co. ................ 3,500 146,125
--------------------------
5,882,673
--------------------------
</TABLE>
22
<PAGE>
THE HUDSON RIVER TRUST
EQUITY INDEX PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ---------------------------------- ------------ --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
UTILITY--GAS (0.4%)
Columbia Gas System, Inc.* ........ 1,700 $ 74,587
Consolidated Natural Gas Co. ..... 3,200 145,200
ENRON Corp. ....................... 8,600 327,875
Nicor, Inc. ....................... 3,000 82,500
--------------------------
630,162
--------------------------
UTILITY--TELEPHONE (7.4%)
Alltel Corp. ...................... 6,500 191,750
Ameritech Corp. ................... 18,900 1,115,100
AT&T Corp. ........................ 54,000 3,496,500
Bell Atlantic Corp. ............... 14,900 996,438
BellSouth Corp. ................... 33,900 1,474,650
GTE Corp. ......................... 33,200 1,460,800
NYNEX Corp. ....................... 14,500 783,000
Pacific Telesis Group ............. 14,600 490,925
SBC Communications, Inc. .......... 20,700 1,190,250
Sprint Corp. ...................... 11,900 474,512
U.S. West Communications Group ... 16,000 572,000
--------------------------
12,245,925
--------------------------
TOTAL CREDIT SENSITIVE (23.6%) ... 39,104,441
--------------------------
ENERGY
COAL & GAS PIPELINES (0.8%)
Burlington Resources, Inc. ........ 4,100 160,925
Coastal Corp. ..................... 3,600 134,100
Enserch Corp. ..................... 4,400 71,500
Pacific Enterprises, Ltd. ......... 2,900 81,925
Panhandle Eastern Corp. ........... 5,100 142,162
Praxair, Inc. ..................... 4,700 158,038
Sonat, Inc. ....................... 2,800 99,750
Tenneco, Inc. ..................... 6,200 307,675
Williams Cos., Inc. ............... 3,500 153,563
--------------------------
1,309,638
--------------------------
OIL--DOMESTIC (2.1%)
Amerada Hess Corp. ................ 3,200 169,600
Amoco Corp. ....................... 16,800 1,207,500
Ashland, Inc. ..................... 2,200 77,275
Atlantic Richfield Co. ............ 5,500 609,125
Kerr McGee Corp. .................. 1,700 107,950
Louisiana Land & Exploration Corp. 1,900 81,463
Occidental Petroleum Corp. ........ 10,300 220,162
Oryx Energy Co.* .................. 5,500 73,563
Pennzoil Co. ...................... 1,700 71,825
Phillips Petroleum Co. ............ 8,900 303,712
Santa Fe Energy Resources,
Inc.* ............................ 2,800 26,950
Sun, Inc. ......................... 2,782 76,157
Unocal Corp. ...................... 8,400 244,650
USX-Marathon Group ................ 10,200 198,900
--------------------------
3,468,832
--------------------------
OIL--INTERNATIONAL (5.6%)
Chevron Corp. ..................... 22,300 1,170,750
Exxon Corp. ....................... 42,200 3,381,275
Mobil Corp. ....................... 13,500 1,512,000
Royal Dutch Petroleum Co. (ADR) .. 18,300 $ 2,582,588
Texaco, Inc. ...................... 8,900 698,650
--------------------------
9,345,263
--------------------------
OIL--SUPPLIES & CONSTRUCTION (0.7%)
Baker Hughes, Inc. ................ 4,800 117,000
Dresser Industries, Inc. .......... 6,200 151,125
Halliburton Co. ................... 3,700 187,312
McDermott International, Inc. .... 4,200 92,400
Schlumberger, Ltd. ................ 8,200 567,850
Western Atlas, Inc.* .............. 1,600 80,800
--------------------------
1,196,487
--------------------------
RAILROADS (1.0%)
Burlington Northern Santa Fe ..... 4,851 378,378
Conrail, Inc. ..................... 2,700 189,000
CSX Corp. ......................... 7,200 328,500
Norfolk Southern Corp. ............ 4,300 341,312
Union Pacific Corp. ............... 7,000 462,000
--------------------------
1,699,190
--------------------------
TOTAL ENERGY (10.2%) ............. 17,019,410
--------------------------
TECHNOLOGY
ELECTRONICS (3.3%)
Advanced Micro Devices, Inc. ..... 4,100 67,650
AMP, Inc. ......................... 7,400 283,975
Applied Materials, Inc.* .......... 6,000 236,250
Cisco Systems, Inc.* .............. 9,300 694,012
Harris Corp. ...................... 1,400 76,475
ITT Industries, Inc. .............. 4,000 96,000
Intel Corp. ....................... 28,100 1,594,675
LSI Logic Corp.* .................. 4,300 140,825
Micron Technology, Inc. ........... 7,000 277,375
Motorola, Inc. .................... 20,100 1,145,700
National Semiconductor Corp.* .... 3,800 84,550
Perkin Elmer Corp. ................ 1,800 67,950
Texas Instruments, Inc. ........... 6,400 331,200
Tyco International, Ltd. .......... 5,200 185,250
3Com Corp.* ....................... 5,500 256,438
--------------------------
5,538,325
--------------------------
OFFICE EQUIPMENT (3.4%)
Amdahl Corp.* ..................... 5,900 50,150
Apple Computer, Inc. .............. 4,100 130,688
Ceridian Corp.* ................... 1,800 74,250
Compaq Computer Corp.* ............ 9,000 432,000
Digital Equipment Corp.* .......... 5,000 320,625
Hewlett-Packard Co. ............... 17,500 1,465,625
Honeywell, Inc. ................... 4,300 209,087
International Business Machines
Corp. ............................ 19,400 1,779,950
Pitney Bowes, Inc. ................ 5,200 244,400
Sun Microsystems, Inc.* ........... 6,400 292,000
Tandem Computers, Inc.* ........... 6,600 70,125
Unisys Corp.* ..................... 3,200 18,000
Xerox Corp. ....................... 3,700 506,900
--------------------------
5,593,800
--------------------------
</TABLE>
23
<PAGE>
THE HUDSON RIVER TRUST
EQUITY INDEX PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- ---------------------------------- ------------ --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
OFFICE EQUIPMENT SERVICES (2.6%)
Autodesk, Inc. .................... 2,000 $ 68,500
Automatic Data Processing, Inc. .. 4,900 363,825
Computer Associates International,
Inc. ............................. 8,200 466,375
Computer Sciences Corp.* .......... 1,800 126,450
First Data Corp. .................. 7,500 501,562
Microsoft Corp.* .................. 20,000 1,755,000
Novell, Inc.* ..................... 12,000 171,000
Oracle Corp.* ..................... 14,850 629,269
Silicon Graphics, Inc.* ........... 5,200 143,000
--------------------------
4,224,981
--------------------------
TELECOMMUNICATIONS (1.2%)
AirTouch Communications, Inc.* ... 16,900 477,425
Andrew Corp.* ..................... 2,050 78,412
Cabletron Systems, Inc.* .......... 2,400 194,400
Cox Communications, Inc.
(Class A)* ....................... 95 1,853
DSC Communications Corp.* ......... 3,900 143,813
MCI Communications Corp. .......... 23,200 606,100
Northern Telecommunications Ltd. . 8,700 374,100
Tellabs, Inc.* .................... 3,000 111,000
--------------------------
1,987,103
--------------------------
TOTAL TECHNOLOGY (10.5%) ......... 17,344,209
--------------------------
DIVERSIFIED
MISCELLANEOUS (1.4%)
Alco Standard Corp. ............... 3,600 164,250
Allied Signal, Inc. ............... 9,700 460,750
Corning, Inc. ..................... 7,200 230,400
Dial Corp. ........................ 3,200 94,800
Minnesota Mining & Manufacturing
Co. .............................. 14,400 954,000
Ogden Corp. ....................... 3,500 $ 74,812
Teledyne, Inc. .................... 3,100 79,438
Textron, Inc. ..................... 2,900 195,750
--------------------------
TOTAL DIVERSIFIED (1.4%) ......... 2,254,200
--------------------------
TOTAL COMMON STOCKS (94.3%)
(Cost $135,386,614) .............. 156,412,083
--------------------------
PREFERRED STOCKS:
DIVERSIFIED (0.0%)
MISCELLANEOUS
Teledyne, Inc.
$1.2 Series E .................... 24 345
--------------------------
TOTAL PREFERRED STOCKS (0.0%)
(Cost $360) ...................... 345
--------------------------
PRINCIPAL
AMOUNT
------------
SHORT-TERM DEBT SECURITIES:
U.S. GOVERNMENT
Federal Home Loan Bank
5.54%, due 01/03/96 .............. $4,000,000 3,997,538
Federal Home Loan Mortgage Corp.
5.75%, due 01/02/96 .............. 2,800,000 2,798,658
--------------------------
TOTAL U.S. GOVERNMENT (4.1%) .... 6,796,196
--------------------------
TOTAL SHORT-TERM DEBT SECURITIES (4.1%)
(Amortized Cost $6,796,196) ..... 6,796,196
--------------------------
TOTAL INVESTMENTS (98.4%)
(Cost/Amortized Cost $142,183,170) 163,208,624
CASH AND RECEIVABLES
LESS LIABILITIES (1.6%) .......... 2,576,657
--------------------------
NET ASSETS (100.0%) ............... $165,785,281
==========================
</TABLE>
<PAGE>
Financial Futures Contracts outstanding at December 31, 1995:
<TABLE>
<CAPTION>
EXPIRATION NUMBER OF ORIGINAL VALUE AT UNREALIZED
DESCRIPTION DATE CONTRACTS VALUE 12/31/95 APPRECIATION
- ---------------------- ------------ -------------- ------------ ------------ --------------
<S> <C> <C> <C> <C> <C>
LONG S & P 500 INDEX* 3/96 20 $6,180,700 $6,184,500 $3,800
</TABLE>
- ------------
* Non-income producing.
See Notes to Financial Statements.
24
<PAGE>
THE HUDSON RIVER TRUST
COMMON STOCK PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- --------------------------------- ------------- --------------------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS (1.6%)
Grace (W.R.) & Co. ............... 397,000 $ 23,472,625
Monsanto Co. ..................... 446,000 54,635,000
--------------------------
78,107,625
--------------------------
CHEMICALS--SPECIALTY (1.3%)
Great Lakes Chemical Corp. ...... 893,900 64,360,800
--------------------------
TOTAL BASIC MATERIALS (2.9%) ... 142,468,425
--------------------------
BUSINESS SERVICES
PRINTING, PUBLISHING &
BROADCASTING (6.5%)
Chris Craft Industries, Inc.
(Class B)*++ .................... 1,223,733 52,926,452
Comcast Corp. (Class A) SPL ..... 411,800 7,489,613
Donnelley (R.R.) & Sons Co. ..... 2,172,200 85,530,375
Grupo Televisa SA (ADR)(a) ...... 450,000 10,125,000
Liberty Media Group (Class A)* .. 1,424,309 38,278,303
Tele-Communications, Inc. (Class
A)* ............................. 5,697,236 113,232,565
Time Warner, Inc. ................ 310,600 11,763,975
--------------------------
TOTAL BUSINESS SERVICES (6.5%) . 319,346,283
--------------------------
CAPITAL GOODS
AEROSPACE (0.2%)
General Motors Corp. (Class H) .. 225,600 11,082,600
--------------------------
BUILDING MATERIALS & FOREST
PRODUCTS (0.1%)
Louisiana Pacific Corp. .......... 200,000 4,850,000
--------------------------
ELECTRICAL EQUIPMENT (0.8%)
Westinghouse Electric Corp. ..... 2,300,000 37,950,000
--------------------------
TOTAL CAPITAL GOODS (1.1%) ..... 53,882,600
--------------------------
CONSUMER CYCLICALS
APPAREL, TEXTILE (0.1%)
Stride Rite Corp. ................ 393,300 2,949,750
--------------------------
AUTOS & TRUCKS (0.6%)
Chrysler Corp. ................... 293,509 16,253,060
General Motors Corp. ............. 244,700 12,938,513
--------------------------
29,191,573
--------------------------
FOOD SERVICES, LODGING (0.1%)
McDonald's Corp. ................. 153,000 6,904,125
--------------------------
LEISURE RELATED (2.2%)
ITT Corporation .................. 1,987,600 105,342,800
--------------------------
PHOTO & OPTICAL (2.4%)
Eastman Kodak Co. ................ 1,737,700 116,425,900
--------------------------
RETAIL--GENERAL (5.6%)
Home Depot, Inc. ................. 1,724,000 82,536,500
Lowes Cos., Inc. ................. 2,401,400 80,446,900
Sears Roebuck & Co. .............. 2,795,500 109,024,500
Talbots, Inc. .................... 70,000 2,012,500
Tandy Corp. ...................... 52,500 2,178,750
--------------------------
276,199,150
--------------------------
TOTAL CONSUMER CYCLICALS (11.0%) 537,013,298
--------------------------
COMMON STOCKS (Continued):
CONSUMER NONCYCLICALS
DRUGS (3.9%)
Amgen, Inc.* ..................... 270,000 $ 16,031,250
Astra AB, Series A ............... 1,350,000 53,859,632
Merck & Co., Inc. ................ 1,018,000 66,933,500
Pfizer, Inc. ..................... 852,000 53,676,000
--------------------------
190,500,382
--------------------------
HOSPITAL SUPPLIES & SERVICES (3.4%)
Abbott Laboratories, Inc. ........ 1,210,000 50,517,500
Columbia/HCA
Healthcare Corp. ................ 505,320 25,644,990
United Healthcare Corp. .......... 1,188,500 77,846,750
U.S. Healthcare, Inc. ............ 207,150 9,632,475
--------------------------
163,641,715
--------------------------
TOBACCO (6.5%)
Loews Corp. ...................... 2,077,500 162,824,062
Philip Morris Cos., Inc. ......... 1,738,300 157,316,150
--------------------------
320,140,212
--------------------------
TOTAL CONSUMER NONCYCLICALS (13.8%) 674,282,309
--------------------------
CREDIT SENSITIVE
BANKS (0.3%)
Grupo Financiero Banamex Series
L* .............................. 19,600 28,758
NationsBank Corp. ................ 224,000 15,596,000
--------------------------
15,624,758
--------------------------
FINANCIAL SERVICES (2.6%)
American Express Co. ............. 1,260,000 52,132,500
Dean Witter Discover & Co. ...... 179,983 8,459,200
Fleet Financial Group, Inc. ..... 855,861 34,876,336
Student Loan Marketing
Association ..................... 441,000 29,050,875
--------------------------
124,518,911
--------------------------
INSURANCE (15.6%)
Allstate Corp.(a) ................ 2,546,647 104,730,858
American International
Group, Inc. ..................... 2,540,050 234,954,625
Berkley (W.R.) Corp. ............. 233,143 12,531,436
ITT Hartford Group, Inc. ......... 1,949,500 94,307,063
Progressive Corp. ................ 1,116,100 54,549,388
TIG Holdings, Inc. ............... 1,283,300 36,574,050
Travelers Group, Inc. ............ 3,532,766 222,122,662
--------------------------
759,770,082
--------------------------
MORTGAGE RELATED (0.6%)
Federal National Mortgage
Association ..................... 230,000 28,548,750
--------------------------
REAL ESTATE (3.8%)
AMLI Residential Property Trust . 138,500 2,770,000
CBL & Associates Properties++ ... 1,097,200 23,864,100
Columbus Realty Trust ............ 360,000 6,975,000
Essex Property Trust, Inc.++ .... 365,000 7,026,250
First Industrial Realty Trust ... 254,500 5,726,250
</TABLE>
25
<PAGE>
THE HUDSON RIVER TRUST
COMMON STOCK PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- --------------------------------- ------------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Gables Residential Trust ......... 314,000 $ 7,182,750
JDN Realty Corporation ........... 126,600 2,832,675
Macerich Co. ..................... 717,500 14,350,000
Manufactured Home Communities ... 338,000 5,915,000
Paragon Group, Inc. .............. 217,800 3,784,275
Regency Realty Corp.++ ........... 768,700 13,260,075
Shurgard Storage Centers, Inc. .. 169,000 4,563,000
Simon Property Group, Inc. ...... 1,493,000 36,391,875
Spieker Properties, Inc. ......... 1,307,200 32,843,400
Summit Properties, Inc. .......... 549,100 10,913,363
Walden Residential
Properties, Inc. ................ 235,000 4,905,625
--------------------------
183,303,638
--------------------------
UTILITY--GAS (0.2%)
Renaissance Energy Ltd.* ......... 455,000 11,328,769
--------------------------
UTILITY--TELEPHONE (0.1%)
BellSouth Corp. .................. 10,824 470,844
Telefonos de Mexico, L(a) ........ 150,000 4,781,250
--------------------------
5,252,094
--------------------------
TOTAL CREDIT SENSITIVE (23.2%) . 1,128,347,002
--------------------------
ENERGY
OIL--INTERNATIONAL (0.1%)
YPF Sociedad Anonima (ADR) ...... 171,000 3,697,875
--------------------------
OIL-- SUPPLIES & CONSTRUCTION (0.9%)
Western Atlas, Inc.* ............. 829,300 41,879,650
--------------------------
RAILROADS (1.8%)
Canadian National Railway* ...... 407,500 6,112,500
Conrail, Inc. .................... 34,000 2,380,000
Southern Pacific Rail Corp.* .... 60,300 1,447,200
Union Pacific Corp. .............. 1,200,000 79,200,000
--------------------------
89,139,700
--------------------------
TOTAL ENERGY (2.8%) ............. 134,717,225
--------------------------
TECHNOLOGY
ELECTRONICS (20.8%)
Applied Materials, Inc.* ......... 100,000 3,937,500
Bay Networks, Inc.*(a) ........... 1,021,900 42,025,638
Cisco Systems, Inc.*(a) .......... 3,613,000 269,620,125
EMC Corp.* ....................... 3,377,900 51,935,213
General Instrument Corp.* ........ 2,861,800 66,894,575
ITT Industries, Inc. ............. 1,949,500 46,788,000
Intel Corp.(a) ................... 2,161,800 122,682,150
Micron Technology, Inc.(a) ...... 864,500 34,255,813
Motorola, Inc.(a) ................ 2,868,600 163,510,200
National Semiconductor Corp.*(a) 3,039,400 67,626,650
Texas Instruments, Inc.(a) ...... 1,610,000 83,317,500
3Com Corp.*(a) ................... 1,325,200 61,787,450
--------------------------
1,014,380,814
--------------------------
OFFICE EQUIPMENT SERVICES (4.6%)
General Motors Corp. (Class E) .. 1,460,000 75,920,000
Microsoft Corp.* ................. 270,000 23,692,500
Oracle Corp.*(a) ................. 2,589,000 109,708,875
Silicon Graphics, Inc.* .......... 530,000 14,575,000
--------------------------
223,896,375
--------------------------
TELECOMMUNICATIONS (9.7%)
AirTouch Communications, Inc.* .. 3,549,600 $ 100,276,200
Cabletron Systems, Inc.* ......... 371,700 30,107,700
DSC Communications Corp.*(a) .... 1,776,300 65,501,063
Mannesmann AG (ADR) .............. 600,700 191,022,600
MCI Communications Corp. ......... 1,386,000 36,209,250
Newbridge Networks Corp.* ........ 290,000 11,998,750
Nokia Corp. (ADR) ................ 484,000 18,815,500
Northern Telecommunications Ltd. 102,500 4,407,500
Rogers Cantel Mobile
Commmunications, Inc. (Class B)
(ADR)* .......................... 275,000 7,287,500
Vodafone Group PLC (ADR) ......... 250,000 8,812,500
--------------------------
474,438,563
--------------------------
TOTAL TECHNOLOGY (35.1%) ........ 1,712,715,752
--------------------------
DIVERSIFIED
MISCELLANEOUS (0.5%)
Anixter International, Inc.* .... 847,434 15,783,458
Hanson PLC (ADR)--Warrants (Class
B)* ............................. 51,320,479 4,811,295
--------------------------
TOTAL DIVERSIFIED (0.5%) ........ 20,594,753
--------------------------
TOTAL COMMON STOCKS (96.9%)
(Cost $3,747,892,690) ........... 4,723,367,647
--------------------------
PREFERRED STOCKS:
CONSUMER CYCLICALS (0.5%)
AUTOS & TRUCKS
Chrysler Corp.
$4.625 Conv., Series A+ ......... 175,700 26,706,400
--------------------------
TOTAL PREFERRED STOCKS (0.5%)
(Cost $22,386,080) .............. 26,706,400
--------------------------
ELECTRONICS (0.5%)
General Instrument Corp.
5.0% Conv., 06/15/00 ............ $22,130,000 24,619,625
3Com Corp.
10.25% Conv., 11/01/01+ ......... 900,000 1,437,750
--------------------------
TOTAL TECHNOLOGY (0.5%) ......... 26,057,375
--------------------------
TOTAL LONG-TERM DEBT SECURITIES (0.5%)
(Amortized Cost $30,433,804) ... 26,057,375
--------------------------
SHORT-TERM DEBT SECURITIES:
COMMERCIAL PAPER
Corporate Asset Funding Co., Inc.
5.9%, due 01/02/96 .............. 11,700,000 11,694,248
Ciesco LP
5.8%, due 01/02/96 .............. 10,000,000 9,995,167
Goldman Sachs & Co.
5.9%, due 01/02/96 .............. 25,000,000 24,987,708
</TABLE>
26
<PAGE>
THE HUDSON RIVER TRUST
COMMON STOCK PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
3----------------------------- ------------------ --------------------------
<S> <C> <C>
SHORT-TERM DEBT SECURITIES (CONTINUED):
International Securitization:
6.0%, due 01/03/96 .......... $25,000,000 $ 24,983,333
6.0%, due 01/04/96 .......... 25,000,000 24,979,167
--------------------------
TOTAL COMMERCIAL PAPER (2.0%) 96,639,623
--------------------------
TIME DEPOSITS (0.0%)
Harris Trust & Savings
5.875%, due 01/02/96 ........ 3,100,000 3,100,000
--------------------------
TOTAL SHORT-TERM DEBT SECURITIES (2.0%)
(Amortized Cost $99,739,623) 99,739,623
--------------------------
TOTAL INVESTMENTS (99.9%)
(Cost/Amortized Cost $3,900,452,197) 4,875,871,045
--------------------------
NUMBEROF
CONTRACTS(B)
OPTIONS WRITTEN**:
Allstate Corp.
January Call 39.625* ........ 2,000 (396,400)
Bay Networks, Inc.
March 40.50 Call* ........... 2,500 (1,442,500)
Cisco Systems, Inc.:
January 78.25 Call* ......... 2,500 (537,500)
January 78.50 Call* ......... 400 (74,800)
February 79.75 Call* ........ 1,000 (266,400)
February 80 Call* ........... 2,000 (722,000)
DSC Communications Corp.:
January 38 Call* ............ 1,000 (224,000)
February 38.375 Call* ....... 2,000 (415,400)
March 34.75 Call* ........... 1,500 (781,500)
Grupo Televisa S.A. (ADR)
January Call 18.375* ........ 2,000 (852,000)
Intel Corp.:
January 58.625 Call* ........ 1,000 (85,000)
January 59.50 Call* ......... 2,000 (82,000)
March 59.375 Call* .......... 2,500 (825,000)
March 60.75 Call* ........... 1,500 (468,750)
March 61 Call* .............. 2,000 (484,000)
March 62.50 Call* ........... 1,500 (271,500)
</TABLE>
<TABLE>
<CAPTION>
NUMBER OF VALUE
CONTRACTS (B) (NOTE 1)
- ----------------------------- ------------- ----------------------------
<S> <C> <C>
OPTIONS WRITTEN** (CONTINUED):
Micron Technology, Inc.
March 45.625 Call* .......... 1,500 $ (464,850)
Motorola, Inc.:
February 61 Call* ........... 2,000 (386,000)
February 65.75 Call* ........ 1,000 (37,000)
March 58.375 Call* .......... 3,000 (1,077,000)
March 60.375 Call* .......... 2,500 (627,500)
March 61.625 Call* .......... 2,500 (557,500)
March 61.746 Call* .......... 2,500 (475,000)
National Semiconductor Corp.:
January 24.875 Call* ........ 1,000 (5,000)
February 22.5 Call* ......... 2,500 (417,250)
February 24.875 Call * ..... 2,000 (128,800)
March 22.50 Call* ........... 2,000 (425,000)
Oracle Corp.:
January 38.125 Call* ........ 2,000 (870,000)
January 40 Call* ............ 2,000 (670,000)
January 44.25 Call* ......... 1,500 (247,650)
February 45.50 Call* ........ 2,000 (414,000)
February 46.75 Call* ........ 1,500 (258,000)
February 47 Call* ........... 1,500 (242,850)
March 43.75 Call* ........... 2,500 (827,500)
March 43.875 Call* .......... 1,500 (452,700)
March 44.50 Call* ........... 1,000 (312,500)
Telefonos de Mexico, L
January Call 30.875* ........ 1,500 (223,500)
Texas Instruments, Inc.:
February 52.75 Call* ........ 1,500 (589,500)
February 60.375 Call* ....... 2,000 (276,000)
3Com Corp.
January 47 Call* ............ 2,000 (402,400)
----------------------------
TOTAL OPTIONS WRITTEN (- 0.4%)
(Premiums Received $31,689,532) (18,316,250)
----------------------------
CASH AND RECEIVABLES
LESS LIABILITIES (0.5%) .... 22,122,205
----------------------------
NET ASSETS (100.0%) .......... $4,879,677,000
============================
</TABLE>
* Non-income producing.
** Covered call option contracts written in connection with securities
held.
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
++ Affiliated company as defined under the Investment Company Act of 1940
(see Note 5).
(a) Partially held as collateral on outstanding written call options.
(b) One contract relates to 100 shares.
See Notes to Financial Statements.
27
<PAGE>
THE HUDSON RIVER TRUST
GLOBAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- --------------------------------- ------------------------- --------------------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS (2.4%)
Bayer AG ......................... 6,000 $ 1,593,139
Dainippon Ink & Chemical, Inc. .. 198,000 922,402
Freeport-McMoRan, Inc. ........... 70,000 2,590,000
Grace (W.R.) & Co. ............... 32,400 1,915,650
Indo Gulf Fertilisers (GDR) ..... 150,000 195,000
Ishihara Sangyo Ltd.* ............ 590,000 1,914,286
Monsanto Co. ..................... 21,500 2,633,750
Nippon Sanso Corp. ............... 10,000 48,039
Riken Vinyl Industries Co. Ltd. . 9,000 82,809
Sanyo Chemicals .................. 37,000 351,545
Sekisui Chemical Co. Ltd. ........ 150,000 2,208,232
Shin-Etsu Chemical Ltd. .......... 23,000 476,707
Showa Denko K.K.* ................ 100,000 313,801
Tessenderlo Chemie ............... 2,300 813,377
--------------------------
16,058,737
--------------------------
CHEMICALS--SPECIALTY (2.0%)
Great Lakes Chemical Corp. ...... 42,400 3,052,800
SGL Carbon AG*+ .................. 120,000 9,371,405
UCAR International, Inc.* ........ 40,000 1,350,000
--------------------------
13,774,205
--------------------------
METALS & MINING (0.4%)
Biron Corp.* ..................... 40,000 13,379
Hoganas AB, Series B+ ............ 5,000 146,035
Johnson Matthey PLC .............. 50,000 406,240
Western Mining Corp. ............. 200,000 1,284,336
Westralian Sands Ltd. ............ 280,000 749,196
--------------------------
2,599,186
--------------------------
PAPER (0.8%)
Asia Pacific Resources
Internationl Holdings Ltd.
(Class A)* ...................... 70,000 332,500
Chuoh Pack Industries Ltd. ...... 5,000 36,320
Enso-Gutzeit, Series R ........... 124,000 826,709
Fletcher Forestry Shares ......... 17,026 24,265
Grupo Industrial Durango (ADR)* . 70,000 463,750
Mayr-Melnhof Karton Aktien+ ..... 24,000 1,201,117
Norske Skogindustrier A.S. 'A'
Free ............................ 10,000 293,856
Oji Paper ........................ 265,000 2,397,191
--------------------------
5,575,708
--------------------------
STEEL (0.9%)
Acerinox S.A. .................... 6,000 605,884
British Steel .................... 700,000 1,769,825
Hitachi Metals Ltd. .............. 17,000 212,397
SSAB Svenskt Stal (Class B) ..... 70,000 706,084
Sumitomo Metal Industries* ...... 950,000 2,879,903
--------------------------
6,174,093
--------------------------
TOTAL BASIC MATERIALS (6.5%) ... 44,181,929
--------------------------
BUSINESS SERVICES
ENVIRONMENTAL CONTROL (0.9%)
Powerscreen International ........ 640,000 3,852,680
Tomra Systems .................... 329,000 2,598,892
--------------------------
6,451,572
--------------------------
PRINTING, PUBLISHING &
BROADCASTING (4.3%)
Capital Radio PLC* ............... 20,000 $ 165,603
Carlton Communications PLC ...... 240,000 3,601,634
Donnelley (R.R.) & Sons Co. ..... 100,700 3,965,063
Elsevier ......................... 280,000 3,733,182
Liberty Media Group (Class A)* .. 73,250 1,968,594
Mirror Group Newspapers PLC ..... 300,000 820,248
Nippon Television Network ........ 15,950 4,263,632
Oriental Press Group ............. 1,000,000 303,912
Reed International ............... 70,000 1,067,876
Sunshine Broadcasting Network ... 90,000 113,717
Tele-Communications, Inc.
(Class A)* ...................... 278,000 5,525,250
Time Warner, Inc. ................ 10,000 378,750
Toppan Printing Co. .............. 11,000 144,891
TVI Televisao Independente* ..... 4,700 21,827
United Newspapers PLC ............ 50,000 431,096
Ver Ned Uitgevers ................ 20,000 2,745,060
Wolters Kluwer ................... 3,000 283,727
--------------------------
29,534,062
--------------------------
PROFESSIONAL SERVICES (0.7%)
Apcoa Parking AG* ................ 21,100 1,390,335
Asatsu, Inc. ..................... 35,000 1,471,186
Automated Security Holdings* .... 153,125 64,228
Blenheim Exhibition Group ........ 25,000 97,094
Randstadt Holdings N.V. .......... 20,000 907,128
Secom Co. ........................ 7,000 486,780
WPP Group PLC .................... 250,000 636,935
--------------------------
5,053,686
--------------------------
TRUCKING, SHIPPING (0.8%)
Autostrade Conc E Costr-Priv .... 180,000 197,234
Brambles Industries Ltd. ......... 100,000 1,114,875
Irish Continental Group .......... 200,442 1,507,626
Kawasaki Kisen* .................. 460,000 1,461,308
Western Bulk Shipping+ ........... 94,500 432,964
Yamato Transport ................. 35,000 416,949
--------------------------
5,130,956
--------------------------
TOTAL BUSINESS SERVICES (6.7%) 46,170,276
--------------------------
CAPITAL GOODS
BUILDING & CONSTRUCTION (2.6%)
Bam Groep Holdings ............... 1,000 57,319
BBC Brown Boveri ................. 3,000 3,483,535
Bufete Industrial S.A. (ADS)* ... 20,000 300,000
Fomento de Construcciones Y
Contratas S.A. .................. 9,000 688,842
Fukuda Corp. ..................... 60,000 543,341
Japan Industrial Land* ........... 8,000 307,603
Kanamoto Co. Ltd. ................ 30,800 399,729
Kaneshita Construction ........... 129,000 1,736,659
Kvaerner AS (Series A)* .......... 11,000 434,465
Macmahon Holdings Ltd. ........... 2,000,000 981,090
Metacorp Berhard* ................ 20,000 51,975
Nanno Construction Co. Ltd.* .... 21,000 235,932
National House Industrial ........ 49,000 896,949
Paul Y.-ITC Construction ......... 500,000 96,347
Paul Y.-ITC
Construction--Warrants* ......... 100,000 3,130
</TABLE>
28
<PAGE>
THE HUDSON RIVER TRUST
GLOBAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- --------------------------------- ------------------------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Penta Ocean Construction ......... 28,000 $ 216,949
PS Corp. ......................... 109,100 1,986,518
Royal Plastics Group Ltd.*+ ..... 70,000 1,012,413
Sacos Corp. ...................... 25,200 512,542
Sekisui House--Warrants* ......... 20 4,500
Sho Bond Construction ............ 31,800 1,068,726
Suido Kiko Kaisha ................ 39,000 338,063
Toda Construction ................ 140,000 1,213,559
Wesco, Inc. ...................... 37,300 903,148
--------------------------
17,473,334
--------------------------
BUILDING MATERIALS & FOREST
PRODUCTS (0.8%)
Advan Co.* ....................... 21,000 549,153
BPB Industries PLC ............... 200,000 938,314
Lafarge Canada ................... 7,000 128,794
Lafarge Corp. .................... 33,000 2,128,706
Louisiana Pacific Corp. .......... 47,000 1,139,750
Macmillan Bloedel Ltd. ........... 35,000 432,518
Nichiha .......................... 17,000 385,278
--------------------------
5,702,513
--------------------------
ELECTRICAL EQUIPMENT (1.1%)
Kinden Corp. ..................... 5,000 85,230
Omron Corp. ...................... 102,000 2,351,186
Vae Eisenbahnsys ................. 4,183 352,362
Westinghouse Electric Corp. ..... 295,000 4,867,500
--------------------------
7,656,278
--------------------------
MACHINERY (3.0%)
Asahi Diamond Industry Co. Ltd. . 9,000 126,392
BT Industries AB*+ ............... 76,500 823,477
Construcciones Auxiliar Ferro ... 9,425 333,537
Fag Kugelfischer Georg Schaefer* 2,000 256,598
IHC Caland* ...................... 63,500 2,136,362
Kalmar Industries AB+ ............ 70,000 1,153,974
Keppel Corp. ..................... 120,000 1,068,929
Keyence Corp. .................... 32,000 3,688,135
Kurita Water Industries .......... 15,000 399,516
Mitsubishi Heavy Industries Ltd. 450,000 3,586,924
Namura Shipbuilding .............. 15,000 82,809
Nippon Seiko K.K. ................ 108,000 784,504
Siebe PLC ........................ 150,000 1,850,219
SMC Corp. ........................ 45,900 3,320,803
Yaskawa Electric Corp.* .......... 191,000 900,891
--------------------------
20,513,070
--------------------------
TOTAL CAPITAL GOODS (7.5%) ..... 51,345,195
--------------------------
CONSUMER CYCLICALS
AIRLINES (0.9%)
Air New Zealand Limted 'B' Shares 250,000 849,875
British Airways .................. 270,000 1,954,614
KLM .............................. 100,000 3,513,876
--------------------------
6,318,365
--------------------------
APPAREL, TEXTILE (0.2%)
Adidas AG*+ ...................... 7,900 415,891
Chargeurs SA ..................... 4,400 877,121
--------------------------
1,293,012
--------------------------
AUTOS & TRUCKS (1.0%)
Honda Motor Corp. ................ 201,000 $ 4,146,538
Mitsubishi Motors Corp. .......... 86,000 700,494
Toyota Motor Co. ................. 40,000 848,426
Volvo AB (Series B) .............. 50,500 1,033,984
--------------------------
6,729,442
--------------------------
AUTO RELATED (1.5%)
Autoliv AB ....................... 30,000 1,752,414
Autoliv AB (ADS)*+ ............... 11,850 688,781
Exedy Corp. ...................... 18,600 295,438
Kasai Kogyo Co. .................. 3,000 13,511
Mabuchi Motor .................... 55,400 3,444,726
Michelin (CGDE), (Class B) ...... 40,000 1,597,219
Minebea Co. ...................... 227,000 1,903,942
NGK Spark Plug Co. ............... 31,000 390,315
Pacific Dunlop ................... 22,300 52,210
--------------------------
10,138,556
--------------------------
FOOD SERVICES, LODGING (0.2%)
AAPC Limited ..................... 1,500,000 813,858
Cafe de Coral .................... 100,000 22,761
International Fast Food Corp.* .. 8,000 4,250
McDonald's Corp. ................. 7,000 315,875
QPQ Corporation* ................. 32,700 61,313
QPQ Corporation--Warrants* ...... 32,700 15,328
--------------------------
1,233,385
--------------------------
HOUSEHOLD FURNITURE, APPLIANCES (1.4%)
Alpine Electronics ............... 40,000 674,092
Atag Holdings .................... 3,800 250,956
Industrie Natuzzi (ADR) .......... 60,000 2,722,500
Matsushita Electric Industries .. 100,000 1,627,118
Morishita Co. Ltd. ............... 11,000 98,015
Nippon Electric Glass ............ 138,000 2,619,661
Noritz Co. ....................... 22,000 357,966
Philips Electronics .............. 30,000 1,084,068
Philips Electronics N.V. (ADR) .. 3,000 107,625
--------------------------
9,542,001
--------------------------
LEISURE RELATED (1.7%)
Cinar Films, Inc. (Class B)* .... 48,000 726,000
Helicopter Line Ltd. ............. 600,000 1,294,425
ITT Corp. ........................ 99,500 5,273,500
Nelvana Limited*+++ .............. 135,800 1,889,495
Rank Organisation PLC ............ 100,000 723,931
Skis Rossignol ................... 280 76,827
Thorn EMI ........................ 25,000 589,165
Turner Broadcasting Systems
(Class B) ....................... 43,000 1,118,000
--------------------------
11,691,343
--------------------------
PHOTO & OPTICAL (0.7%)
Eastman Kodak Co. ................ 59,300 3,973,100
Luxottica Group (ADR) ............ 20,000 1,170,000
--------------------------
5,143,100
--------------------------
RETAIL--GENERAL (4.7%)
Asda/Mfi ......................... 500,000 858,309
Centros Comerciales Pryca S.A. .. 80,000 1,675,605
Chiyoda Co.* ..................... 40,800 948,378
Daiichi Corp. .................... 5,000 118,160
Doshisha Co.* .................... 42,000 1,492,881
</TABLE>
29
<PAGE>
THE HUDSON RIVER TRUST
GLOBAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- --------------------------------- ------------------------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Eidensha Co. Ltd. ................ 59,000 $ 742,857
Fu Hui Jewellery* ................ 900,000 34,918
Homac Corp. ...................... 29,000 513,995
Home Centers Ltd.* ............... 142,800 946,050
Home Depot, Inc. ................. 97,000 4,643,875
Home Wide Corp., Inc. ............ 2,000 23,632
Lowes Cos., Inc. ................. 126,300 4,231,050
Matsuyadenki Co. Industries ..... 25,000 295,400
MFI Furniture PLC ................ 200,000 498,674
Morrison (Wm.) Supermarkets ..... 240,000 529,433
Nissen Corp. Ltd. ................ 55,360 1,297,542
Paris Miki, Inc.* ................ 23,400 840,814
Pinault Printemps ................ 2,000 399,509
Rinascente ....................... 175,000 1,059,061
Sato Corp. ....................... 48,000 1,259,855
Sears Roebuck & Co. .............. 124,300 4,847,700
Shimamura Co. Ltd. ............... 46,500 1,796,949
Swank International Manufacturing 1,400,000 161,138
Talbots, Inc. .................... 45,000 1,293,750
Tandy Corp. ...................... 5,300 219,950
Warehouse Group Ltd. ............. 156,250 414,723
Xebio Co. ........................ 33,400 1,180,726
--------------------------
32,324,934
--------------------------
TOTAL CONSUMER CYCLICALS (12.3%) 84,414,138
--------------------------
CONSUMER NONCYCLICALS
BEVERAGES (0.7%)
Grand Metropolitan ............... 300,000 2,162,472
Lion Nathan Ltd. ................. 800,000 1,908,950
Panamerican Beverages ............ 30,000 960,000
--------------------------
5,031,422
--------------------------
FOODS (0.5%)
Fyffes PLC* ...................... 800,000 1,382,677
Nestle AG ........................ 500 552,860
NV (Verenigde Bed) Nutricia*+ ... 2,900 234,520
Shriram Industrial Enterprises
Ltd. (GDR)+ ..................... 165,000 536,250
Shriram Industrial Enterprises
Ltd.--Warrants* ................. 55,000 550
Viscofan Envoltura ............... 75,000 888,828
--------------------------
3,595,685
--------------------------
DRUGS (5.0%)
Amgen, Inc.* ..................... 14,000 831,250
Astra AB (Series A) .............. 60,000 2,393,762
Cochlear Ltd.*+ .................. 50,400 108,633
Merck KGAA*+ ..................... 65,000 2,664,993
Merck & Co., Inc. ................ 48,000 3,156,000
Novo-Nordisk AS .................. 22,900 3,133,741
Pfizer, Inc. ..................... 42,000 2,646,000
Roche Holdings AG Genusscheine .. 800 6,325,823
Sankyo Co. ....................... 101,000 2,269,443
Santen Pharmaceutical Co. ........ 137,000 3,104,891
Taisho Pharmaceutical ............ 35,000 691,526
Takeda Chemical Industries ...... 35,000 576,271
Yamanouchi Pharmaceutical ........ 82,000 1,763,099
Zeneca Group PLC ................. 220,000 4,258,454
--------------------------
33,923,886
--------------------------
HOSPITAL SUPPLIES & SERVICES (0.9%)
Abbott Laboratories, Inc. ........ 58,500 $ 2,442,375
Healthsource, Inc.* .............. 33,000 1,188,000
Patriot American Hospitality .... 24,000 618,000
Quest Medical, Inc.* ............. 164,543 1,707,134
Scandinavian Mobility
International*+ ................. 13,700 328,085
Tamro Group ...................... 10,000 43,910
--------------------------
6,327,504
--------------------------
RETAIL-- FOOD (0.4%)
Casino Guichard-Perrachon* ...... 29,200 848,358
Ministop Co. Ltd. ................ 4,000 115,061
Seven-Eleven Japan Ltd. .......... 25,000 1,762,712
York-Benimaru Co. ................ 5,000 191,283
--------------------------
2,917,414
--------------------------
SOAPS & TOILETRIES (0.2%)
McBride PLC*+ .................... 400,000 1,211,730
--------------------------
TOBACCO (2.2%)
Loews Corp. ...................... 94,800 7,429,950
Philip Morris Cos., Inc. ......... 83,500 7,556,750
--------------------------
14,986,700
--------------------------
TOTAL CONSUMER NONCYCLICALS (9.9%) 67,994,341
--------------------------
CREDIT SENSITIVE
BANKS (3.4%)
Advance Bank of Australia ........ 89,000 713,089
Akita Bank ....................... 86,000 675,506
Asahi Bank Ltd. .................. 59,000 742,857
Banco Latinoamericano de
Exportaciones, S.A. ............. 60,000 2,790,000
Banco Osorno Y La Union (ADR) ... 15,000 208,125
Banco Popular .................... 6,000 1,104,615
Bancomer B Local* ................ 1,000,000 278,678
Bankgesellschaft Berliner* ...... 6,500 1,658,822
Bankinter--Banco Interc Espana* . 4,500 437,007
Barclays Bank .................... 200,000 2,296,073
Fokus Bank* ...................... 58,000 313,842
Grupo Financiero Banorte (Class
B)* ............................. 143,000 133,084
Hachijuni Bank ................... 87,000 960,581
Hock Hua Bank .................... 180,000 510,296
HSBC Holding PLC ................. 140,000 2,118,332
Mitsubishi Bank .................. 58,000 1,365,036
Mitsubishi Trust & Banking ...... 165,000 2,748,668
Nordbanken AB*+ .................. 38,000 657,908
Overseas Chinese Bank ............ 81,000 1,013,574
Overseas Union Bank Ltd. ......... 220,400 1,519,194
Schweiz Bankverein ............... 500 204,073
Sparbanken Sverige AB*+ .......... 10,000 121,916
Toho Bank ........................ 86,000 620,533
United Overseas Bank ............. 6,000 57,688
Yamanashi Chuo Bank .............. 34,000 339,177
--------------------------
23,588,674
--------------------------
FINANCIAL SERVICES (3.5%)
American Express Co. ............. 28,400 1,175,050
Americredit Corp.* ............... 296,700 4,042,537
</TABLE>
30
<PAGE>
THE HUDSON RIVER TRUST
GLOBAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- --------------------------------- ------------------------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Capital One Financial Corp. ..... 70,000 $ 1,671,250
Credit Local de France ........... 30,000 2,404,416
Credit Saison Co. ................ 28,900 688,562
Hong Leong Finance ............... 160,000 454,719
Invesco .......................... 400,000 1,575,249
JCG Holdings ..................... 142,000 103,757
Mercury Finance Co. .............. 100,950 1,337,588
MS Financial, Inc.* .............. 101,000 694,375
Nichiei Co. Ltd. ................. 40,000 2,983,050
Promise Co. Ltd. ................. 35,000 1,684,746
Sanyo Shinpan Finance Co. Ltd. .. 22,800 1,876,998
Union Acceptance Corp.
(Class A)* ...................... 63,800 893,200
Yamaichi Securities .............. 330,000 2,566,489
--------------------------
24,151,986
--------------------------
INSURANCE (7.2%)
Acceptance Industries Cos., Inc.* 75,100 1,117,113
Aegon N.V. ....................... 120,000 5,308,196
Allstate Corp. ................... 96,008 3,948,329
American International Group,
Inc. ............................ 86,250 7,978,125
Corporacion Mapfre Cia Inter .... 44,340 2,477,760
Fortes Amev N.V. ................. 50,000 3,348,774
ITT Hartford Group, Inc. ......... 93,000 4,498,875
Koa Fire & Marine ................ 97,000 593,743
PennCorp Financial Group, Inc. .. 75,700 2,223,688
Progressive Corp. ................ 55,000 2,688,125
PMI Group, Inc. .................. 4,000 181,000
Travelers Group, Inc. ............ 162,900 10,242,338
Twentieth Century Industries* ... 211,000 4,193,625
--------------------------
48,799,691
--------------------------
MORTGAGE RELATED (0.2%)
Federal National Mortgage
Association ..................... 12,000 1,489,500
--------------------------
REAL ESTATE (3.0%)
AMLI Residential Property Trust . 32,000 640,000
CBL & Associates Properties ..... 21,700 471,975
Cheung Kong Holdings ............. 160,000 974,588
Chubu Sekiwa Real Estate ......... 23,000 356,416
Daibiru Corp. .................... 23,000 260,630
Essex Property Trust, Inc. ...... 32,800 631,400
First Industrial Realty Trust ... 62,000 1,395,000
Gables Residential Trust ......... 32,000 732,000
Highwoods Properties, Inc. ...... 49,000 1,384,250
Hong Kong Land Holding ........... 703,000 1,300,539
JP Realty, Inc. .................. 87,300 1,909,687
Macerich Co. ..................... 109,700 2,194,000
Mitsubishi Estate Co. ............ 92,000 1,149,443
Saul Centers, Inc. ............... 16,000 218,000
Shurgard Storage Centers, Inc.
(Class A) ....................... 22,000 594,000
Spieker Properties, Inc. ......... 37,700 947,213
Storage USA, Inc. ................ 48,000 1,566,000
Summit Properties ................ 102,000 2,027,250
Sun Communities, Inc. ............ 41,000 1,081,375
Tucker Properties Corp. .......... 54,900 480,375
--------------------------
20,314,141
--------------------------
UTILITY--ELECTRIC (0.8%)
Chilectra S.A. ................... 5,000 $ 247,500
Enersis S.A. (ADR) ............... 45,000 1,282,500
EVN .............................. 2,000 274,513
Hidroelectrica del Cantabrico ... 14,000 483,917
Powergen PLC ..................... 100,000 827,239
Veba AG .......................... 60,000 2,552,034
--------------------------
5,667,703
--------------------------
UTILITY--TELEPHONE (1.5%)
Empresas Telex-Chile S.A. (ADR) . 45,000 466,875
Kon PTT Nederland+ ............... 50,000 1,816,126
Nippon Telegraph & Telephone
Corp. ........................... 32 258,789
PT Indonesian Satellite (ADR) ... 40,000 1,460,000
Stet-Societa Finanziaria
Telefonica (ADR) ................ 64,000 180,961
Tele Danmark AS, (B Shares) ..... 53,000 2,891,562
Telefonica de Espana SA .......... 50,000 691,310
Telephone & Data Systems, Inc. .. 61,700 2,437,150
--------------------------
10,202,773
--------------------------
TOTAL CREDIT SENSITIVE (19.6%) 134,214,468
--------------------------
ENERGY
OIL--DOMESTIC (0.0%)
XCL Corp.* ....................... 850,000 318,750
--------------------------
OIL--INTERNATIONAL (1.6%)
Ampolex Ltd.* .................... 155,000 338,699
Aran Energy PLC* ................. 1,400,000 1,674,673
Canadian Occidental .............. 5,000 163,750
ENI Spa* ......................... 666,000 2,327,700
Omv AG ........................... 40,000 3,468,572
Repsol SA ........................ 70,000 2,289,966
Yukong Ltd. (GDR)*+ .............. 35,000 315,000
Yukong Ltd. (GDS)* ............... 4,194 72,893
--------------------------
10,651,253
--------------------------
OIL--SUPPLIES & CONSTRUCTION (0.2%)
Coflexip (ADR) ................... 70,117 1,323,458
--------------------------
RAILROADS (1.1%)
Canadian National Railway* ...... 50,000 750,000
Conrail, Inc. .................... 32,000 2,240,000
Union Pacific Corp. .............. 71,000 4,686,000
--------------------------
7,676,000
--------------------------
UTILITY--GAS (0.1%)
Renaissance Energy Ltd.* ......... 23,000 572,663
--------------------------
TOTAL ENERGY (3.0%) ............. 20,542,124
--------------------------
TECHNOLOGY
ELECTRONICS (9.4%)
ASM Lithography Holding N.V.* ... 16,000 553,249
Austria Mikro Systeme
International+ .................. 72 11,666
Aval Data* ....................... 37,000 695,206
Bay Networks, Inc.* .............. 83,050 3,415,431
Cisco Systems, Inc.* ............. 160,000 11,940,000
EMC Corp.* ....................... 208,000 3,198,000
Futaba Corp. ..................... 12,000 549,734
General Instrument Corp.* ........ 97,600 2,281,400
GP Batteries International ...... 850,000 2,048,500
</TABLE>
31
<PAGE>
THE HUDSON RIVER TRUST
GLOBAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- --------------------------------- ------------------------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
GP Batteries
International--Rights* .......... 12,500 $ 6,250
Hirose Electric Co. Ltd. ......... 31,400 1,806,450
Hoya Corp. ....................... 85,000 2,922,518
Intel Corp. ...................... 57,000 3,234,750
ITT Industries Inc ............... 93,000 2,232,000
Kyocera Corp. .................... 27,00 2,005,714
Micron Technology, Inc. .......... 34,500 1,367,063
Motorola, Inc. ................... 56,400 3,214,800
National Semiconductor Corp.* ... 156,000 3,471,000
NEC Corp. ........................ 320,000 3,905,085
Nikon Corp. ...................... 119,000 1,613,559
Rohm Co. Ltd. .................... 70,000 3,952,542
TDK Corp. ........................ 55,000 2,807,264
Texas Instruments, Inc. .......... 57,000 2,949,750
Tokyo Electron ................... 85,000 3,292,978
3Com Corp.* ...................... 28,500 1,328,813
--------------------------
64,803,722
--------------------------
OFFICE EQUIPMENT (1.0%)
Canon, Inc. ...................... 200,000 3,622,276
Fujitsu Ltd. ..................... 30,000 334,140
Ricoh Elemex Corp. ............... 22,000 317,482
Sterling Software, Inc.* ......... 42,000 2,619,750
--------------------------
6,893,648
--------------------------
OFFICE EQUIPMENT SERVICES (1.7%)
Accugraph Corp. (Class A)* ...... 6,200 16,572
General Motors Corp. (Class E) .. 89,000 4,628,000
Getronics N.V. ................... 10,000 467,271
Istar Internet, Inc.*+ ........... 12,500 117,855
Microsoft Corp.* ................. 13,000 1,140,750
Misys PLC* ....................... 125,000 1,106,869
Oracle Corp.* .................... 100,000 4,237,500
--------------------------
11,714,817
--------------------------
TELECOMMUNICATIONS (5.8%)
AirTouch Communications, Inc.* .. 178,000 5,028,500
BCE Mobile Communications, Inc.* 16,000 540,442
Bell Cablemedia PLC (ADR)* ...... 49,300 788,800
Cabletron Systems, Inc.* ......... 25,400 2,057,400
Cellular Communications Puerto
Rico, Inc.* ..................... 7,600 210,900
Cox Communications, Inc.
(Class A)* ...................... 72,000 1,404,000
DSC Communications Corp.* ........ 55,600 2,050,250
Filtronic Comtek PLC ............. 1,210,000 9,323,486
Hong Kong Telecommunications Ltd. 680,000 1,213,579
Mannesmann AG .................... 7,000 2,228,149
MCI Communications Corp. ......... 59,000 1,541,375
Memc Electronic Materials* ...... 49,500 1,614,938
Newbridge Networks Corp.* ........ 36,000 1,489,500
Nihon Dempa Kogyo ................ 94,000 2,103,051
Rogers Cantel Mobile
Communications, Inc. (Class B)* 20,000 527,260
Rogers Cantel Mobile
Commmunications, Inc.
(Class B) (ADR)* ................ 63,900 1,693,350
Tokyo Broadcasting System ........ 108,000 1,778,208
Total Access Communication*+ .... 473,000 $ 3,074,500
U.S. Cellular Corp.* ............. 35,600 1,201,500
--------------------------
39,869,188
--------------------------
TOTAL TECHNOLOGY (17.9%) ........ 123,281,375
--------------------------
DIVERSIFIED
MISCELLANEOUS (1.4%)
Alba ............................. 9,300 571,738
BTR PLC .......................... 200,000 1,022,203
Crean (James) PLC--Units ......... 385,000 1,201,441
Hanson PLC ....................... 500,000 1,495,244
Indonesia Fund, Inc.* ............ 25,000 253,125
International UNP Holdings* ..... 450,000 151,587
International UNP
Holdings--Warrants* ............. 225,000 10,858
Pittston Services Group .......... 56,000 1,757,000
Taiwan Fund ...................... 40,000 820,000
Tomkins PLC ...................... 500,000 2,190,435
--------------------------
TOTAL DIVERSIFIED (1.4%) ........ 9,473,631
--------------------------
TOTAL COMMON STOCKS (84.8%)
(Cost $508,790,513) ............. 581,617,477
--------------------------
PREFERRED STOCKS:
TECHNOLOGY
ELECTRONICS (0.5%)
Korea Electric Power (ADR) ...... 120,000 3,180,000
--------------------------
TELECOMMUNICATIONS (0.2%)
Nokia Oy Cum ..................... 44,000 1,729,744
--------------------------
TOTAL TECHNOLOGY (0.7%) ......... 4,909,744
--------------------------
TOTAL PREFERRED STOCKS (0.7%)
(Cost $3,183,006) ............... 4,909,744
--------------------------
PRINCIPAL
AMOUNT
LONG-TERM DEBT SECURITIES:
CAPITAL GOODS (0.1%)
BUILDING & CONSTRUCTION
Boskalis Westminster
5.25% Conv., 06/01/00 ........... $1,500,000 911,178
--------------------------
TECHNOLOGY
ELECTRONICS (0.9%)
Altera Corp.
5.75% Sub. Conv. Note, 06/15/02+ 825,000 961,125
3Com Corp.
10.25% Conv., 11/01/01+ ......... 3,000,000 4,792,500
--------------------------
TOTAL TECHNOLOGY (0.9%) .......... 5,753,625
--------------------------
DIVERSIFIED (0.0%)
MISCELLANEOUS
Brierley Investment Ltd.
9.0% Sub. Conv. Note, 06/30/98 . 27,900 20,793
--------------------------
TOTAL LONG-TERM DEBT SECURITIES (1.0%)
(Amortized Cost $5,858,307) .... 6,685,596
--------------------------
</TABLE>
32
<PAGE>
THE HUDSON RIVER TRUST
GLOBAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ----------------------------- ------------ -------------
<S> <C> <C>
SHORT-TERM DEBT SECURITIES:
BANKERS' ACCEPTANCES (0.6%)
Bank of Tokyo
6.12%, due 01/29/96 ......... $ 4,000,000 $ 3,979,600
-------------
CERTIFICATES OF DEPOSIT
Mitsubishi Bank Ltd.-N.Y.
6.0%, due 01/10/96 .......... 10,000,000 10,000,000
6.0%, due 02/29/96 .......... 10,000,000 10,002,042
Norinchuckin Bank Ltd.
5.86%, due 03/14/96 ......... 5,000,000 5,004,387
Societe Generale Bank
5.77%, due 04/22/96 ......... 5,000,000 5,000,931
-------------
TOTAL CERTIFICATES OF DEPOSIT (4.4%) 30,007,360
-------------
COMMERCIAL PAPER
Alamo Funding
5.75%, due 02/02/96 ......... 1,000,000 994,569
Allianz of America Financial
5.66%, due 02/09/96 ......... 3,040,000 3,020,404
Briarcliff Capital Corp.
5.69%, due 02/01/96 ......... 11,002,000 10,944,616
Corporate Asset Funding Co., Inc.
5.9%, due 01/02/96 .......... 5,200,000 5,197,443
SHORT-TERM DEBT SECURITIES (Continued):
Dynamic Funding Corp.
6.1%, due 01/02/96 .......... $ 7,300,000 $ 7,296,289
Equipment Funding, Inc.
5.87%, due 02/07/96 ......... 6,100,000 6,061,209
Ford Motor Credit Co.
5.67%, due 02/09/96 ......... 4,000,000 3,974,170
Hanson PLC
5.7%, due 01/26/96 .......... 750,000 746,794
International Securitization
6.0%, due 01/03/96 .......... 10,500,000 10,493,000
Morgan Stanley Group, Inc.
6.08%, due 01/02/96 ......... 2,480,000 2,478,744
-------------
TOTAL COMMERCIAL PAPER (7.4%) 51,207,238
-------------
TOTAL SHORT-TERM DEBT SECURITIES (12.4%)
(Amortized Cost $85,187,195) 85,194,198
-------------
TOTAL INVESTMENT (98.9%)
(Cost/Amortized Cost $603,019,021) 678,407,015
CASH AND RECEIVABLES
LESS LIABILITIES (1.1%) .... 7,733,378
-------------
NET ASSETS (100.0%) .......... $686,140,393
=============
</TABLE>
* Non-income producing.
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
++ Affiliated company as defined under the Investment Company Act of 1940
(see Note 5).
See Notes to Financial Statements.
33
<PAGE>
THE HUDSON RIVER TRUST
INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS:
AUSTRALIA
Advance Bank of Australia ...... 6,000 $ 48,073
Cochlear Ltd.*+ ................. 97,300 209,724
Guiness Peat Group* ............. 12,000 6,422
Gwalia Consolidated ............. 5,000 8,547
Novus Petroleum Ltd.* ........... 50,000 60,203
Oil Search Ltd. ................. 20,000 17,243
Plutonic Resources .............. 10,000 47,568
Qantas Airways Ltd. ............. 30,000 49,946
Villa World Ltd. ................ 50,000 36,419
Westralian Sands Ltd. ........... 14,000 37,460
--------------------------
TOTAL AUSTRALIA (1.8%) ......... 521,605
--------------------------
AUSTRIA (0.2%)
Omv AG .......................... 600 52,029
--------------------------
CANADA
Accugraph Corp. (Class A)* ..... 5,000 13,365
Cinar Films, Inc. (Class B)* ... 1,000 15,125
Istar Internet, Inc.*+ .......... 16,000 150,854
Nelvana Limited*+ ............... 1,000 13,914
Quality Dino Entertainment Ltd.* 3,000 8,625
--------------------------
TOTAL CANADA (0.7%) ............ 201,883
--------------------------
CHILE (0.1%)
Enersis S.A. (ADR) .............. 1,000 28,500
--------------------------
DENMARK
Novo-Nordisk AS ................. 350 47,896
Scandinavian Mobility
International*+ ................ 6,000 143,686
Tele Danmark AS, (B Shares) .... 2,000 109,116
--------------------------
TOTAL DENMARK (1.0%) ........... 300,698
--------------------------
FRANCE
Casino Guichard-Perrachon* ..... 2,202 63,976
Coflexip (ADR) .................. 3,000 56,625
Credit Local de France .......... 1,000 80,147
Michelin (CGDE), (Class B) ..... 900 35,937
Pernod-Ricard ................... 2,000 113,801
--------------------------
TOTAL FRANCE (1.2%) ............ 350,486
--------------------------
GERMANY
Adidas AG*+ ..................... 3,300 173,727
Apcoa Parking AG* ............... 800 52,714
Bayer AG ........................ 100 26,552
Merck KGAA*+ .................... 1,000 41,000
Schwarz Pharma AG* .............. 1,000 49,368
SGL Carbon AG*+ ................. 3,000 234,285
Skw Trostberg ................... 1,000 21,211
Turbon International AG* ........ 1,500 44,451
Veba AG ......................... 2,500 106,335
--------------------------
TOTAL GERMANY (2.6%) ........... 749,643
--------------------------
HONG KONG
Amoy Properties ................. 50,000 49,790
Ek Chor China Motorcycle Co. ... 3,000 34,875
Guangzhou Investment ............ 200,000 38,280
Hong Kong Telecommunications
Ltd. ........................... 12,000 21,416
HSBC Holding PLC ................ 5,000 75,655
COMMON STOCKS (Continued):
Jardine International
Holdings Ltd. .................. 32,000 $ 36,417
--------------------------
TOTAL HONG KONG (0.9%) ......... 256,433
--------------------------
INDONESIA
Asia Pacific Resources
International Holdings Ltd.
(Class A)* ..................... 1,000 4,750
PT Indonesian Satellite (ADR) .. 1,500 54,750
--------------------------
TOTAL INDONESIA (0.2%) ......... 59,500
--------------------------
IRELAND
Crean (James) PLC--Units ........ 5,000 15,603
Fyffes PLC* ..................... 40,000 69,134
--------------------------
TOTAL IRELAND (0.3%) ........... 84,737
--------------------------
ISRAEL (0.3%)
Home Centers Ltd.* .............. 11,400 75,525
--------------------------
ITALY
Editoriale La Repubblica* ...... 40,000 35,769
ENI Spa* ........................ 30,000 104,850
Industrie Natuzzi (ADR) ......... 1,700 77,138
Rinascente ...................... 10,000 60,518
Telecom Italia .................. 10,000 15,555
Telecom Italia Mobile Spa* ..... 10,000 17,601
--------------------------
TOTAL ITALY (1.1%) ............. 311,431
--------------------------
JAPAN
Advan Co.* ...................... 3,000 78,450
Akita Bank ...................... 8,000 62,838
Alpine Electronics .............. 5,000 84,262
Aoki Marine* .................... 4,000 31,574
Asahi Bank Ltd. ................. 3,000 37,772
Asahi Diamond Industry Co. Ltd. 5,000 70,218
Asatsu, Inc. .................... 2,000 84,068
Aval Data* ...................... 1,000 18,789
Canon, Inc. ..................... 8,000 144,891
Chiyoda Co.* .................... 5,500 127,845
Coco's Japan Co. Ltd. ........... 1,000 11,041
Credit Saison Co. ............... 6,000 142,954
Dai-Ichi Corp. .................. 1,500 35,448
Doshisha Co.* ................... 4,000 142,179
Eidensha Co. Ltd. ............... 6,000 75,545
Fujitsu Ltd. .................... 3,000 33,414
Futaba Corp. .................... 1,000 45,811
Hachijuni Bank .................. 2,000 22,082
Hankyu Corp. .................... 25,000 136,804
Hirose Electric Co. Ltd. ........ 3,000 172,591
Hitachi Metals Ltd. ............. 6,000 74,964
Home Wide Corp, Inc. ............ 1,000 11,816
Honda Motor Corp. ............... 9,000 185,666
Hoya Corp. ...................... 4,000 137,530
I-Net Corporation* .............. 4,000 75,545
Ishihara Sangyo Ltd.* ........... 25,000 81,114
Japan Industrial Land* .......... 4,000 153,801
Kaneshita Construction .......... 4,000 53,850
Kawasaki Kisen* ................. 20,000 63,535
Keyence Corp. ................... 1,800 207,459
Koa Fire & Marine ............... 31,000 189,753
Kurita Water Industries ......... 1,000 26,634
</TABLE>
34
<PAGE>
THE HUDSON RIVER TRUST
INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Kyocera Corp. ................... 1,000 $ 74,286
Mabuchi Motor ................... 2,200 136,794
Matsushita Electric Industries . 2,000 32,542
Minebea Co. ..................... 12,000 100,649
Ministop Co. Ltd. ............... 1,000 28,765
Mitsubishi Bank ................. 3,000 70,605
Mitsubishi Estate Co. ........... 3,000 37,482
Mitsubishi Heavy Industries Ltd. 25,000 199,274
Mitsubishi Trust & Banking ..... 5,000 83,293
Mitsui Home Co. Ltd. ............ 3,000 47,942
Nanno Construction Co. Ltd.* ... 6,000 67,409
NEC Corp. ....................... 12,000 146,441
NGK Spark Plug Co. .............. 3,000 37,772
Nichiei Co. Ltd. ................ 3,000 223,729
Nichiha ......................... 3,000 67,990
Nikon Corp. ..................... 4,000 54,237
Nippon Electric Glass ........... 6,000 113,898
Nippon Kanzai Co. ............... 1,000 30,896
Nippon Paper Industries ......... 7,000 48,610
Nippon Seiko K.K. ............... 9,000 65,375
Nippon Telegraph &
Telephone Corp. ................ 10 80,872
Nippon Television Network ...... 800 213,850
Nissen Corp. Ltd. ............... 3,300 77,346
Ohmoto Gumi* .................... 1,000 24,697
Oji Paper ....................... 4,000 36,184
Omron Corp. ..................... 7,000 161,356
Oriental Construction Co. ...... 4,000 85,230
Paris Miki, Inc.* ............... 3,500 125,763
PCA Corporation* ................ 2,000 83,293
Penta Ocean Construction ........ 3,000 23,245
Promise Co. Ltd. ................ 2,500 120,339
PS Corp. ........................ 5,000 91,041
Rohm Co. Ltd. ................... 4,000 225,860
Sankyo Co. ...................... 9,000 202,228
Santen Pharmaceutical Co. ...... 7,000 158,644
Sanyo Shinpan Finance Co. Ltd. . 2,500 205,811
Sato Corp. ...................... 2,000 52,494
Secom Co. ....................... 1,000 69,540
Sekisui Chemical Co. Ltd. ...... 6,000 88,329
Seven-Eleven Japan Ltd. ......... 1,000 70,508
Shimamura Co. Ltd. .............. 3,000 115,932
Sho Bond Construction ........... 3,000 100,823
Shohkoh Fund* ................... 1,000 185,956
SMC Corp. ....................... 900 65,114
Sumitomo Metal Industries* ..... 55,000 166,731
Taisho Pharmaceutical ........... 10,000 197,579
TDK Corp. ....................... 3,000 153,123
Teijin Ltd. ..................... 2,000 10,228
Toda Construction ............... 8,000 69,346
Toho Bank ....................... 3,000 21,646
Tokyo Broadcasting System ...... 12,000 197,579
Tokyo Electron .................. 3,000 116,223
Toppan Printing Co. ............. 10,000 131,719
Wesco, Inc. ..................... 2,500 60,533
Xebio Co. ....................... 4,000 141,404
Yamaichi Securities ............. 13,000 101,104
Yamanashi Chuo Bank ............. 5,000 49,879
Yamanouchi Pharmaceutical ...... 4,000 86,005
Yaskawa Electric Corp.* ......... 18,000 84,901
York-Benimaru Co. ............... 2,200 $ 84,165
Yorozu Corp.* ................... 3,000 54,625
--------------------------
TOTAL JAPAN (31.0%) ............ 8,879,477
--------------------------
MALAYSIA
Guinness Anchor BHD ............. 6,000 11,245
Hock Hua Bank ................... 7,000 19,845
MBF Capital BHD ................. 30,000 30,358
Metacorp BHD* ................... 13,333 34,648
Peladang Kimia BHD* ............. 5,000 12,797
Pelangi BHD ..................... 19,000 18,404
Road Builder Holdings* .......... 10,000 34,650
--------------------------
TOTAL MALAYSIA (0.6%) .......... 161,947
--------------------------
MEXICO (0.3%)
Panamerican Beverages ........... 3,000 96,000
--------------------------
NETHERLANDS
Aegon N.V. ...................... 5,000 221,175
Elsevier ........................ 12,000 159,994
Fortis Amev N.V. ................ 800 53,580
IHC Caland* ..................... 4,000 134,574
KLM ............................. 2,000 70,278
Kon PTT Nederland+ .............. 3,000 108,967
NV (Verenigde Bed) Nutricia*+ .. 1,000 80,869
Philips Electronics N.V. ........ 500 18,067
Ver Ned Uitgevers ............... 500 68,627
--------------------------
TOTAL NETHERLANDS (3.2%) ...... 916,131
--------------------------
NEW ZEALAND
Air New Zealand Limted 'B'
Shares ......................... 10,000 33,995
Fisher & Paykel ................. 20,000 60,799
Helicopter Line Ltd. ............ 15,000 32,361
Lion Nathan Ltd. ................ 15,000 35,793
Warehouse Group Ltd. ............ 60,000 159,253
--------------------------
TOTAL NEW ZEALAND (1.1%) ...... 322,201
--------------------------
NORWAY
C. Tybring-Gjedde AS* ........... 1,300 24,646
Elkjop Norge AS* ................ 2,000 49,608
Fokus Bank* ..................... 1,500 8,117
Kvaerner AS (Series A)* ......... 500 19,748
Merkantildata AS ................ 10,000 112,171
Petroleum Geo-Services (ADR)* .. 2,000 50,000
Tomra Systems ................... 18,000 142,188
--------------------------
TOTAL NORWAY (1.4%) ............ 406,478
--------------------------
PANAMA (0.6%)
Banco Latinoamericano de
Exportaciones, S.A. ............ 4,000 186,000
--------------------------
PERU (0.2%)
Banco Wiese Limitado (ADS) ..... 10,000 62,500
--------------------------
SINGAPORE
GP Batteries International ..... 30,000 72,300
Overseas Chinese Bank ........... 1,000 12,513
Overseas Union Bank Ltd. ........ 3,000 20,679
--------------------------
TOTAL SINGAPORE (0.4%) ......... 105,492
--------------------------
SPAIN
Banco de Valencia ............... 12,000 167,890
Banco Popular ................... 200 36,821
Bankinter--Banco Interc Espana* 1,000 97,113
</TABLE>
35
<PAGE>
THE HUDSON RIVER TRUST
INTERNATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Centros Comerciales Pryca S.A. . 3,650 $ 76,449
Construcciones Auxiliar Ferro .. 500 17,694
Corporacion Mapfre Cia Inter ... 2,700 150,879
Cubiertas* ...................... 2,000 110,610
Fomento de Construcciones Y
Contratas S.A. ................. 1,200 91,846
Hidroelectrica del Cantabrico .. 4,000 138,260
Repsol SA ....................... 3,000 98,141
Telefonica de Espana ............ 3,000 41,479
Viscofan Envoltura .............. 2,500 29,628
--------------------------
TOTAL SPAIN (3.7%) ............. 1,056,810
--------------------------
SWEDEN
Astra AB (Series B) ............. 2,000 79,190
Autoliv AB (ADS) ................ 1,200 70,097
BT Industries AB*+ .............. 8,500 91,497
Kalmar Industries AB+ ........... 4,000 65,941
Nordbanken AB*+ ................. 5,800 100,418
--------------------------
TOTAL SWEDEN (1.4%) ............ 407,143
--------------------------
SWITZERLAND
BBC Brown Boveri ................ 70 81,282
Roche Holdings AG Genusscheine . 10 79,073
--------------------------
TOTAL SWITZERLAND (0.6%) ...... 160,355
--------------------------
THAILAND (0.4%)
Total Access Communication*+ ... 16,000 104,000
--------------------------
UNITED KINGDOM
Aran Energy PLC* ................ 30,000 35,886
Barclays Bank ................... 10,000 114,804
British Airways ................. 10,000 72,393
Capital Radio PLC* .............. 10,000 82,802
Carlton Communications PLC ..... 10,000 150,068
Filtronic Comtek PLC ............ 2,000 15,411
Grand Metropolitan .............. 12,000 86,499
Hanson PLC ...................... 16,000 47,848
McBride PLC*+ ................... 20,000 60,587
Mirror Group Newspapers PLC .... 10,000 27,342
Misys PLC* ...................... 10,000 88,550
Morrison (Wm.) Supermarkets .... 80,000 176,478
Powergen PLC (ADR) .............. 3,000 24,817
Powerscreen International ...... 30,000 180,593
Rank Organisation PLC ........... 8,000 57,915
Reed International .............. 6,000 91,532
Tate & Lyle PLC ................. 12,000 87,990
Tomkins PLC ..................... 25,000 109,522
WPP Group PLC ................... 30,000 76,432
Zeneca Group PLC ................ 4,000 77,426
--------------------------
TOTAL UNITED KINGDOM (5.8%) ... 1,664,895
--------------------------
TOTAL COMMON STOCKS (61.1%)
(Cost $16,634,981) ............. 17,521,899
--------------------------
PREFERRED STOCKS:
FINLAND (0.4%)
Nokia Corp. (ADR) ................ 3,000 $ 116,625
------------
GERMANY (0.5%)
Fielmann AG DEM5 ................. 2,600 134,519
------------
SOUTH KOREA (0.3%)
Korea Electric Power (ADR) ...... 3,000 79,500
------------
TOTAL PREFERRED STOCKS (1.2%)
(Cost $295,547) ................. 330,644
------------
PRINCIPAL
AMOUNT
-----------
LONG-TERM DEBT SECURITIES:
NETHERLANDS (0.1%)
Boskalis Westminster
5.25% Conv., 06/01/00 ........... $50,000 30,373
------------
TOTAL LONG-TERM DEBT SECURITIES (0.1%)
(Amortized Cost $27,968) ........ 30,373
------------
SHORT-TERM DEBT SECURITIES:
U.S. GOVERNMENT
Federal Home Loan Bank
5.54%, due 01/03/96 ............. 6,000,000 5,996,307
Federal Home Loan Mortgage Corp.
5.75%, due 01/02/96 ............. 5,300,000 5,297,460
------------
TOTAL U.S. GOVERNMENT (39.3%) .. 11,293,767
------------
TOTAL SHORT-TERM DEBT SECURITIES (39.3%)
(Amortized Cost $11,293,767) ... 11,293,767
------------
TOTAL INVESTMENTS (101.7%)
(Cost/Amortized Cost $28,252,263) 29,176,683
LIABILITIES IN EXCESS OF CASH AND
RECEIVABLES (-1.7%) ............. (492,820)
------------
NET ASSETS (100.0%) .............. $28,683,863
============
</TABLE>
MARKET SECTOR DIVERSIFICATION
As a Percentage of Total Equity
Investments
Basic Materials ........ 4.9%
Business Services ...... 9.6
Capital Goods .......... 14.4
Consumer Cyclicals .... 18.4
Consumer Non-Cyclicals 12.8
Credit Sensitive ....... 21.7
Energy ................. 3.1
Technology ............. 14.1
Diversified ............ 1.0
-------
100.0%
=======
- ------------
* Non-income producing.
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
See Notes to Financial Statements.
36
<PAGE>
THE HUDSON RIVER TRUST
AGGRESSIVE STOCK PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- ---------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS--SPECIALTY (1.4%)
Cytec Industries, Inc.* ......... 242,200 $ 15,107,225
UCAR International, Inc.* ...... 698,200 23,564,250
---------------
38,671,475
---------------
METALS & MINING (0.7%)
Newmont Mining Corp. ............ 440,000 19,910,000
---------------
TOTAL BASIC MATERIALS (2.1%) .. 58,581,475
---------------
BUSINESS SERVICES
ENVIRONMENTAL CONTROL (1.8%)
USA Waste Services, Inc.* ...... 2,508,600 47,349,825
---------------
PRINTING, PUBLISHING &
BROADCASTING (2.4%)
Infinity Broadcasting Corp.
(Class A)* ..................... 1,531,500 57,048,375
Playboy Enterprises, Inc.
(Class B)*++ ................... 931,200 7,798,800
---------------
64,847,175
---------------
PROFESSIONAL SERVICES (0.5%)
Loewen Group, Inc. .............. 558,700 14,142,094
---------------
TRUCKING, SHIPPING (2.2%)
TNT Freightways Corp. ........... 480,550 9,671,069
Xtra Corp.++ .................... 1,186,300 50,417,750
---------------
60,088,819
---------------
TOTAL BUSINESS SERVICES (6.9%) 186,427,913
---------------
CONSUMER CYCLICALS
AIRLINES (5.1%)
America West Airlines, Inc.
(Class B)* ..................... 1,565,100 26,606,700
Delta Air Lines, Inc. ........... 257,000 18,985,875
Northwest Airlines Corp.
(Class A)* ..................... 624,200 31,834,200
Southwest Airlines Co. .......... 852,200 19,813,650
USAir Group, Inc.* .............. 2,968,200 39,328,650
---------------
136,569,075
---------------
APPAREL, TEXTILE (3.8%)
Jones Apparel Group* ............ 375,700 14,793,188
Nine West Group, Inc.*++ ........ 2,341,600 87,810,000
---------------
102,603,188
---------------
FOOD SERVICES, LODGING (3.8%)
Extended Stay America, Inc. * .. 480,300 13,208,250
HFS, Inc.* ...................... 653,600 53,431,800
Host Marriott Corp. * ........... 2,798,100 37,074,825
---------------
103,714,875
---------------
HOUSEHOLD FURNITURE, APPLIANCES (1.8%)
Industrie Natuzzi (ADR) ......... 1,081,300 49,063,988
---------------
LEISURE RELATED (4.8%)
Ascent Entertainment Group,
Inc.* .......................... 374,000 5,890,500
Heritage Media Corp.
(Class A)* ..................... 692,850 17,754,281
ITT Corp. ....................... 1,049,300 55,612,900
Mirage Resorts, Inc.* ........... 787,300 27,161,850
Sierra On-line, Inc.* ........... 772,900 22,220,875
---------------
128,640,406
---------------
COMMON STOCKS (Continued):
PHOTO & OPTICAL (0.2%)
Luxottica Group (ADR) ........... 93,700 $ 5,481,450
---------------
RETAIL--GENERAL (10.4%)
Bed Bath & Beyond, Inc.* ........ 1,336,800 51,884,550
Federated Department Stores,
Inc.* .......................... 3,730,500 102,588,750
Office Depot, Inc.* ............. 2,823,025 55,754,744
Office Max, Inc.* ............... 2,807,300 62,813,337
Staples, Inc.* .................. 375,800 9,160,125
---------------
282,201,506
---------------
TOTAL CONSUMER CYCLICALS (29.9%) 808,274,488
---------------
CONSUMER NONCYCLICALS
DRUGS (3.8%)
Amgen, Inc.* .................... 419,900 24,931,563
Biogen, Inc.* ................... 354,000 21,771,000
Centocor, Inc.* ................. 1,111,600 34,320,650
Cephalon, Inc.* ................. 464,500 18,928,375
Pharmacyclics, Inc.* ............ 173,000 2,422,000
---------------
102,373,588
---------------
HOSPITAL SUPPLIES & SERVICES (12.7%)
Apria Healthcare Group, Inc.* .. 1,217,380 34,390,985
Boston Scientific Corp.* ........ 849,700 41,635,300
Healthsouth Corp.* .............. 1,974,900 57,518,962
Healthwise of America, Inc.*++ . 946,135 36,899,265
Manor Care, Inc. ................ 695,200 24,332,000
Saint Jude Medical, Inc.* ...... 759,150 32,643,450
Summit Technology, Inc.* ........ 551,950 18,628,313
Sun Healthcare Group, Inc.*++ .. 2,555,700 34,501,950
Surgical Care Affiliates, Inc. . 1,819,800 61,873,200
---------------
342,423,425
---------------
TOTAL CONSUMER NONCYCLICALS (16.5%) 444,797,013
---------------
CREDIT SENSITIVE
INSURANCE (6.5%)
CNA Financial Corp.* ............ 1,102,600 125,145,100
ITT Hartford Group, Inc. ........ 1,049,300 50,759,887
---------------
175,904,987
---------------
UTILITY--TELEPHONE (4.4%)
Telephone & Data Systems, Inc.++ 2,981,100 117,753,450
---------------
TOTAL CREDIT SENSITIVE (10.9%) 293,658,437
---------------
ENERGY
OIL--DOMESTIC (1.0%)
Diamond Shamrock, Inc. .......... 424,400 10,981,350
Snyder Oil Corp. ................ 1,229,300 14,905,262
---------------
25,886,612
---------------
OIL--SUPPLIES & CONSTRUCTION (10.1%)
Arethusa (Off-Shore) Ltd. ...... 754,800 21,134,400
Diamond Offshore Drilling, Inc.* 1,960,900 66,180,375
Global Marine, Inc.* ............ 6,292,600 55,060,250
Noble Drilling Corp.* ........... 3,875,300 34,877,700
Reading & Bates Corp.* .......... 2,518,600 37,779,000
Rowan Cos., Inc.* ............... 4,133,400 40,817,325
Sonat Offshore Drilling, Inc. .. 354,700 15,872,825
---------------
271,721,875
---------------
TOTAL ENERGY (11.1%) ........... 297,608,487
---------------
</TABLE>
37
<PAGE>
THE HUDSON RIVER TRUST
AGGRESSIVE STOCK PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- ---------------
<S> <C> <C>
COMMON STOCKS (Continued):
TECHNOLOGY
ELECTRONICS (3.3%)
Applied Materials, Inc. * ...... 276,400 $ 10,883,250
Bay Networks, Inc.* ............. 353,350 14,531,519
ITT Industries, Inc. ............ 1,049,300 25,183,200
Parametric Technology Corp.* ... 564,600 37,545,900
---------------
88,143,869
---------------
OFFICE EQUIPMENT (0.9%)
Dell Computer Corp.* ............ 318,800 11,038,450
Storage Technology Corp.* ...... 585,600 13,981,200
---------------
25,019,650
---------------
OFFICE EQUIPMENT SERVICES (2.7%)
Hummingbird Communications Ltd.* 112,300 4,548,150
Informix Corp.* ................. 1,727,300 51,819,000
Sybase, Inc. * .................. 442,300 15,922,800
---------------
72,289,950
---------------
TELECOMMUNICATIONS (10.0%)
American Satellite
Network--Warrants * ............ 49,450 0
Andrew Corp.* ................... 577,400 22,085,550
Ascend Communications, Inc. * .. 185,600 15,056,800
Cellular Communications, Inc.
(Class A) ...................... 605,329 30,115,118
DSC Communications Corp. * ..... 521,300 19,222,937
Mannesmann AG (ADR) ............. 243,600 77,464,800
Millicom International Cellular
S.A.* .......................... 1,140,215 34,776,557
Tellabs, Inc. * ................. 498,900 18,459,300
U.S. Cellular Corp.* ............ 1,043,000 35,201,250
Vanguard Cellular Systems, Inc.
(Class A)* ..................... 981,550 19,876,388
---------------
272,258,700
---------------
TOTAL TECHNOLOGY (16.9%) ...... 457,712,169
---------------
DIVERSIFIED (1.1%)
MISCELLANEOUS
Pittston Services Group ......... 925,600 29,040,700
---------------
TOTAL COMMON STOCKS (95.4%)
(Cost $2,062,941,937) .......... 2,576,100,682
---------------
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ----------------------------- ------------ --------------
SHORT-TERM DEBT SECURITIES:
BANKERS' ACCEPTANCES (0.0%)
Bank of Tokyo
6.12%, due 02/05/96 ......... $ 1,000,000 $ 993,710
--------------
CERTIFICATES OF DEPOSIT
Mitsubishi Bank Ltd.-N.Y.:
6.0%, due 01/10/96 .......... 10,000,000 10,000,000
6.0%, due 02/29/96 .......... 15,000,000 15,003,063
--------------
TOTAL CERTIFICATES OF DEPOSIT (0.9%) 25,003,063
--------------
COMMERCIAL PAPER
Ciesco LP
5.8%, due 01/04/96 .......... 500,000 499,597
Equipment Funding, Inc.
5.87%, due 02/07/96 ......... 9,100,000 9,042,132
Hanson PLC
5.68%, due 02/08/96 ......... 7,300,000 7,253,929
International Securitization
6.0%, due 01/04/96 .......... 25,000,000 24,979,167
Ranger Funding Corp.
5.69%, due 02/09/96 ......... 7,000,000 6,954,638
Sheffield Receivables Corp.
5.73%, due 01/19/96 ......... 1,500,000 1,495,225
--------------
TOTAL COMMERCIAL PAPER (1.9%) 50,224,688
--------------
TIME DEPOSITS (0.9%)
Harris Trust & Savings
5.875%, due 01/02/96 ........ 23,000,000 23,000,000
--------------
TOTAL SHORT-TERM DEBT SECURITIES (3.7%)
(Amortized Cost $99,218,398) 99,221,461
--------------
TOTAL INVESTMENTS (99.1%)
(Cost/Amortized Cost $2,162,160,335) 2,675,322,143
CASH AND RECEIVABLES
LESS LIABILITIES (0.9%) .... 25,192,706
--------------
NET ASSETS (100.0%) .......... $2,700,514,849
==============
</TABLE>
- ------------
* Non-income producing.
++ Affiliated company as defined under the Investment Company Act of 1940
(see Note 5).
See Notes to Financial Statements.
38
<PAGE>
THE HUDSON RIVER TRUST
CONSERVATIVE INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- ---------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS (0.6%)
Air Products & Chemicals, Inc. 4,000 $ 211,000
Hercules, Inc. ................. 25,000 1,409,375
------------
1,620,375
------------
METALS & MINING (0.3%)
Aluminum Co. of America ........ 12,000 634,500
------------
TOTAL BASIC MATERIALS (0.9%) . 2,254,875
------------
BUSINESS SERVICES (0.4%)
PROFESSIONAL SERVICES
Reynolds & Reynolds Co. ........ 25,000 971,875
------------
CAPITAL GOODS
ELECTRICAL EQUIPMENT (0.7%)
General Electric Co. ........... 25,000 1,800,000
------------
MACHINERY (0.2%)
Deere & Co. .................... 12,000 423,000
------------
TOTAL CAPITAL GOODS (0.9%) ... 2,223,000
------------
CONSUMER CYCLICALS
FOOD SERVICES, LODGING (0.4%)
McDonald's Corp. ............... 25,000 1,128,125
------------
PHOTO & OPTICAL (0.3%)
Eastman Kodak Co. .............. 10,000 670,000
------------
RETAIL--GENERAL (0.1%)
Rite Aid Corp. ................. 8,300 284,275
------------
TOTAL CONSUMER CYCLICALS (0.8%) 2,082,400
------------
CONSUMER NONCYCLICALS
BEVERAGES (0.6%)
Coca-Cola Co. .................. 20,000 1,485,000
------------
FOODS (0.2%)
IBP, Inc. ...................... 12,000 606,000
------------
DRUGS (0.6%)
Pfizer, Inc. ................... 25,000 1,575,000
------------
HOSPITAL SUPPLIES & SERVICES (0.7%)
Medtronic, Inc. ................ 30,000 1,676,250
------------
SOAPS & TOILETRIES (0.7%)
Gillette Corp. ................. 32,100 1,673,213
------------
TOBACCO (0.8%)
Philip Morris Cos., Inc. ...... 21,000 1,900,500
UST, Inc. ...................... 6,000 200,250
------------
2,100,750
------------
TOTAL CONSUMER NONCYCLICALS (3.6%) 9,116,213
------------
CREDIT SENSITIVE
BANKS (1.4%)
Bank of New York Co. ........... 40,000 1,950,000
Citicorp ....................... 15,000 1,008,750
First Bank Systems, Inc. ...... 10,000 496,250
------------
3,455,000
------------
FINANCIAL SERVICES (0.2%)
American Express Co. ........... 15,000 620,625
------------
INSURANCE (0.9%)
AFLAC, Inc. .................... 15,000 650,625
General Reinsurance Corp. ..... 10,000 1,550,000
------------
2,200,625
------------
COMMON STOCKS (Continued):
UTILITY--GAS (0.2%)
ENRON Corp. .................... 15,000 $ 571,875
------------
UTILITY--TELEPHONE (1.1%)
Ameritech Corp. ................ 20,000 1,180,000
NYNEX Corp. .................... 28,800 1,555,200
------------
2,735,200
------------
TOTAL CREDIT SENSITIVE (3.8%) 9,583,325
------------
ENERGY
OIL--DOMESTIC (0.3%)
Amoco Corp. .................... 12,000 862,500
------------
OIL--INTERNATIONAL (0.5%)
Mobil Corp. .................... 10,000 1,120,000
------------
TOTAL ENERGY (0.8%) ........... 1,982,500
------------
TECHNOLOGY (0.2%)
ELECTRONICS
Molex, Inc. .................... 14,000 444,500
------------
DIVERSIFIED (0.1%)
MISCELLANEOUS
Allied Signal, Inc. ............ 8,000 380,000
------------
TOTAL COMMON STOCKS (11.5%)
(Cost $20,755,754) ........... 29,038,688
------------
PRINCIPAL
AMOUNT
------------
LONG-TERM DEBT SECURITIES:
BUSINESS SERVICES
PRINTING, PUBLISHING &
BROADCASTING (5.7%)
Tele-Communications, Inc.
8.0%, 08/01/05 ................ $ 6,475,000 6,873,147
Time Warner Entertainment
8.375%, 03/15/23 .............. 7,000,000 7,535,570
------------
TOTAL BUSINESS SERVICES (5.7%) 14,408,717
------------
CREDIT SENSITIVE
BANKS (3.9%)
Abbey National PLC
6.69%, 10/17/05 ............... 3,500,000 3,632,405
Chemical Banking Corp.
8.625% Sub. Deb., 05/01/02 ... 5,500,000 6,220,390
------------
9,852,795
------------
FINANCIAL SERVICES (3.1%)
Lehman Brothers Holdings
8.75%, 03/15/05 ............... 6,800,000 7,732,280
------------
INSURANCE (2.8%)
Prudential Insurance Co.
8.1%, 07/15/15+ ............... 6,800,000 7,165,840
------------
MORTGAGE RELATED (10.7%)
Federal National Mortgage
Association:
6.0%, 11/01/08 ................ 3,853,201 3,814,669
6.0%, 11/01/10 ................ 17,548,890 17,373,401
Premier Auto Trust
7.15%, 02/04/99 ............... 5,650,000 5,780,628
------------
26,968,698
------------
</TABLE>
39
<PAGE>
THE HUDSON RIVER TRUST
CONSERVATIVE INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------- ------------ -------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES
(Continued):
FOREIGN GOVERNMENT (2.2%)
Generalitat de Catalunya
6.375%, 12/15/07 .............. $ 5,500,000 $ 5,534,012
-------------
U.S. GOVERNMENT (49.6%)
U.S. Treasury:
5.5% Note, 11/15/98 ........... 27,000,000 27,194,049
7.75% Note, 12/31/99 .......... 5,000,000 5,428,125
6.125% Note, 09/30/00 ......... 20,000,000 20,625,000
5.75% Note, 10/31/00 .......... 11,765,000 11,945,145
6.375% Note, 08/15/02 ......... 7,800,000 8,194,875
6.5% Note, 08/15/05 ........... 16,005,000 17,050,319
6.875% Bond, 08/15/25 ......... 30,665,000 34,593,947
-------------
125,031,460
-------------
TOTAL CREDIT SENSITIVE (72.3%) 182,285,085
-------------
TOTAL LONG-TERM DEBT SECURITIES (78.0%)
(Amortized Cost $190,548,258) 196,693,802
-------------
SHORT-TERM DEBT SECURITIES:
COMMERCIAL PAPER
Alamo Funding
5.7%, Due 02/02/96 ............ $ 3,000,000 $ 2,983,850
-------------
ESC Securitization, Inc.
5.8%, Due 02/01/96 ............ 10,000,000 9,946,833
-------------
TOTAL COMMERCIAL PAPER (5.1%) 12,930,683
-------------
U.S. GOVERNMENT (3.9%)
Federal Home Loan Mortgage
Corp.
5.75%, Due 01/02/96 ............ 9,600,000 9,595,400
-------------
TOTAL SHORT-TERM DEBT SECURITIES (9.0%)
(Amortized Cost $22,526,083) . 22,526,083
-------------
TOTAL INVESTMENTS (98.5%)
(Cost/Amortized Cost $233,830,095) 248,258,573
CASH AND RECEIVABLES
LESS LIABILITIES (1.5%) ....... 3,842,422
-------------
NET ASSETS (100.0%) ............ $252,100,995
=============
</TABLE>
- ------------
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
See Notes to Financial Statements.
40
<PAGE>
THE HUDSON RIVER TRUST
BALANCED PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- -------------------------------- ------------ -------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS (3.0%)
Freeport-McMoRan, Inc. .......... 107,500 $ 3,977,500
Hercules, Inc. .................. 140,000 7,892,500
IMC Global, Inc. ................ 260,000 10,627,500
Monsanto Co. .................... 193,000 23,642,500
-------------
46,140,000
-------------
CHEMICALS--SPECIALTY (1.0%)
Morton International, Inc. ..... 150,000 5,381,250
UCAR International, Inc.* ...... 170,000 5,737,500
Wellman, Inc. ................... 176,500 4,015,375
-------------
15,134,125
-------------
METALS & MINING (0.2%)
Alumax, Inc.* ................... 96,900 2,967,562
Nord Resources Corp.* ........... 26,078 58,676
-------------
3,026,238
-------------
PAPER (0.2%)
Champion International Corp. ... 71,000 2,982,000
-------------
STEEL (0.0%)
Lukens, Inc. .................... 20,000 575,000
-------------
TOTAL BASIC MATERIALS (4.4%) .. 67,857,363
-------------
BUSINESS SERVICES
ENVIRONMENTAL CONTROL (0.1%)
WMX Technologies, Inc. .......... 70,000 2,091,250
-------------
PRINTING, PUBLISHING &
BROADCASTING (3.0%)
Cablevision System Corp.
(Class A)* ..................... 152,500 8,273,125
Clear Channel Communications,
Inc.* .......................... 243,000 10,722,375
Comcast Corp. (Class A) SPL .... 355,000 6,456,563
Infinity Broadcasting Corp.
(Class A)* ..................... 140,500 5,233,625
Liberty Media Group (Class A)* . 381,000 10,239,375
Tele-Communications, Inc.
(Class A)* ..................... 255,000 5,068,125
Tele-Communications
International, Inc.* ........... 10,000 227,500
-------------
46,220,688
-------------
PROFESSIONAL SERVICES (0.2%)
Ideon Group, Inc. ............... 260,700 2,639,587
-------------
TRUCKING, SHIPPING (0.2%)
Sea Containers Ltd. ............. 98,800 1,716,650
-------------
TOTAL BUSINESS SERVICES (3.5%) 52,668,175
-------------
CAPITAL GOODS
AEROSPACE (0.3%)
Boeing Co. ...................... 40,000 3,135,000
Coltec Industries, Inc.* ........ 200,000 2,325,000
-------------
5,460,000
-------------
BUILDING & CONSTRUCTION (0.2%)
American Standard Companies,
Inc.* .......................... 100,000 2,800,000
-------------
BUILDING MATERIALS
& FOREST PRODUCTS (0.2%)
Martin Marietta Materials, Inc. 150,000 3,093,750
-------------
ELECTRICAL EQUIPMENT (0.2%)
General Electric Co. ............ 40,000 2,880,000
-------------
MACHINERY (0.4%)
Solectron Corp.* ................ 141,500 6,243,688
-------------
TOTAL CAPITAL GOODS (1.3%) .... 20,477,438
-------------
COMMON STOCKS (Continued):
CONSUMER CYCLICALS
AIRLINES (0.3%)
Northwest Airlines Corp.
(Class A)* ..................... 75,000 $ 3,825,000
-------------
AUTOS & TRUCKS (0.4%)
Autozone, Inc.* ................. 210,000 6,063,750
-------------
FOOD SERVICES, LODGING (0.9%)
John Q. Hammons Hotels, Inc.
(Class A)* ..................... 300,000 2,775,000
La Quinta Motor Inns, Inc. ..... 120,000 3,285,000
McDonald's Corp. ................ 160,000 7,220,000
-------------
13,280,000
-------------
HOUSEHOLD FURNITURE, APPLIANCES (0.1%)
First Brands Corporation ........ 38,600 1,838,325
-------------
LEISURE RELATED (2.3%)
Carnival Corp. .................. 310,000 7,556,250
Cyrk, Inc.* ..................... 212,800 2,074,800
Disney (Walt) Co. ............... 145,000 8,555,000
Gaylord Entertainment Co.
(Class A) ...................... 216,930 6,019,807
ITT Corp. ....................... 214,600 11,373,800
-------------
35,579,657
-------------
PHOTO & OPTICAL (0.3%)
Eastman Kodak Co. ............... 62,000 4,154,000
-------------
RETAIL--GENERAL (0.6%)
Fingerhut Companies, Inc. ...... 484,200 6,718,275
Payless Cashways, Inc.* ......... 435,000 1,848,750
Tandy Corp. ..................... 35,000 1,452,500
-------------
10,019,525
-------------
TOTAL CONSUMER CYCLICALS (4.9%) 74,760,257
-------------
CONSUMER NONCYCLICALS
BEVERAGES (1.5%)
Coca-Cola Co. ................... 80,000 5,940,000
Pepsico, Inc. ................... 315,000 17,600,625
-------------
23,540,625
-------------
DRUGS (4.1%)
Biogen, Inc.* ................... 40,000 2,460,000
Centocor, Inc.* ................. 136,500 4,214,437
Lilly (Eli) & Co. ............... 89,500 5,034,375
Merck & Co., Inc. ............... 215,000 14,136,250
Pharmacia & Upjohn, Inc. ........ 157,330 6,096,538
Pfizer, Inc. .................... 150,000 9,450,000
Schering Plough Corp. ........... 160,000 8,760,000
Warner-Lambert Co. .............. 124,100 12,053,213
-------------
62,204,813
-------------
HOSPITAL SUPPLIES & SERVICES (2.6%)
Amsco International, Inc.* ..... 189,700 2,821,787
Columbia/HCA Healthcare Corp. .. 260,000 13,195,000
Guidant Corp. ................... 60,000 2,535,000
Healthsource, Inc.* ............. 200,000 7,200,000
Summit Technology, Inc.* ........ 80,000 2,700,000
United Healthcare Corp. ......... 120,000 7,860,000
U.S. Healthcare, Inc. ........... 80,000 3,720,000
-------------
40,031,787
-------------
RETAIL--FOOD (0.1%)
Kroger Co.* ..................... 31,992 1,199,700
-------------
SOAPS & TOILETRIES (0.9%)
Gillette Corp. .................. 265,000 13,813,125
-------------
</TABLE>
41
<PAGE>
THE HUDSON RIVER TRUST
BALANCED PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ------------ -------------
<S> <C> <C>
COMMON STOCKS (Continued):
TOBACCO (3.2%)
Loews Corp. ..................... 130,000 $ 10,188,750
Philip Morris Cos., Inc. ........ 425,000 38,462,500
-------------
48,651,250
-------------
TOTAL CONSUMER NONCYCLICALS (12.4%) 189,441,300
-------------
CREDIT SENSITIVE
BANKS (0.6%)
NationsBank Corp. ............... 140,000 9,747,500
-------------
FINANCIAL SERVICES (1.2%)
Household International, Inc. .. 50,000 2,956,250
MBNA Corp. ...................... 185,000 6,821,875
Merrill Lynch & Co., Inc. ...... 165,000 8,415,000
-------------
18,193,125
-------------
INSURANCE (6.0%)
Aetna Life & Casualty Co. ...... 117,900 8,164,575
American International
Group, Inc. .................... 130,000 12,025,000
CNA Financial Corp.* ............ 15,400 1,747,900
General Re Corp. ................ 32,000 4,960,000
ITT Hartford Group, Inc. ........ 164,700 7,967,362
Life Re Corp. ................... 205,500 5,137,500
MGIC Investment Corp. ........... 80,000 4,340,000
NAC Re Corp. .................... 100,000 3,600,000
PMI Group, Inc. ................. 110,000 4,977,500
TIG Holdings, Inc. .............. 240,000 6,840,000
Transatlantic Holdings, Inc. ... 80,100 5,877,338
Travelers Group, Inc. ........... 422,000 26,533,250
-------------
92,170,425
-------------
UTILITY--GAS (0.7%)
ENRON Corp. ..................... 295,000 11,246,875
-------------
UTILITY--TELEPHONE (2.2%)
AT&T Corp. ...................... 250,000 16,187,500
Telefonos de Mexico, L .......... 150,000 4,781,250
Telephone & Data Systems, Inc. . 271,600 10,728,200
-------------
31,696,950
-------------
TOTAL CREDIT SENSITIVE (10.7%) 163,054,875
-------------
ENERGY
OIL--DOMESTIC (1.2%)
Atlantic Richfield Co. .......... 35,000 3,876,250
Tom Brown, Inc.* ................ 120,000 1,755,000
Louis Dreyfus Natural Gas Corp.* 245,400 3,711,675
Louisiana Land & Exploration
Corp. .......................... 94,200 4,038,825
Occidental Petroleum Corp. ..... 203,700 4,354,088
-------------
17,735,838
-------------
OIL--SUPPLIES & CONSTRUCTION (0.3%)
Smith International, Inc.* ..... 180,000 4,230,000
-------------
RAILROADS (0.3%)
Union Pacific Corp. ............. 73,000 4,818,000
-------------
TOTAL ENERGY (1.8%) ............ 26,783,838
-------------
TECHNOLOGY
ELECTRONICS (4.4%)
Altera Corp.* ................... 85,000 4,228,750
Applied Materials, Inc.* ........ 275,500 10,847,812
Bay Networks, Inc.* ............. 151,500 6,230,438
Cisco Systems, Inc.* ............ 120,000 8,955,000
General Instrument Corp.* ...... 221,300 5,172,888
Intel Corp. ..................... 215,000 12,201,250
ITT Industries, Inc. ............ 209,600 5,030,400
COMMON STOCKS (Continued):
Lam Research Corp.* ............. 55,000 $ 2,516,250
Motorola, Inc. .................. 40,000 2,280,000
National Semiconductor Corp.* .. 257,620 5,732,045
3Com Corp.* ..................... 70,000 3,263,750
-------------
66,458,583
-------------
OFFICE EQUIPMENT (1.9%)
Ceridian Corp.* ................. 342,800 14,140,500
Compaq Computer Corp.* .......... 235,000 11,280,000
Compuware Corp.* ................ 226,400 4,188,400
-------------
29,608,900
-------------
OFFICE EQUIPMENT SERVICES (1.8%)
First Data Corp. ................ 100,000 6,687,500
General Motors Corp. (Class E) . 130,000 6,760,000
Informix Corp.* ................. 40,000 1,200,000
Microsoft Corp.* ................ 45,000 3,948,750
Oracle Corp.* ................... 205,000 8,686,875
-------------
27,283,125
-------------
TELECOMMUNICATIONS (2.9%)
AirTouch Communications, Inc.* . 321,800 9,090,850
Commnet Cellular, Inc.* ......... 80,000 2,310,000
Cox Communications, Inc.
(Class A)* ..................... 410,000 7,995,000
Glenayre Technologies, Inc.* ... 45,000 2,801,250
MCI Communications Corp. ........ 477,500 12,474,687
Millicom International Cellular
S.A.* .......................... 14,800 451,400
Scientific Atlanta, Inc. ........ 339,800 5,097,000
Tellabs, Inc.* .................. 90,000 3,330,000
-------------
43,550,187
-------------
TOTAL TECHNOLOGY (11.0%) ...... 166,900,795
-------------
DIVERSIFIED
MISCELLANEOUS (1.1%)
Alco Standard Corp. ............. 160,000 7,300,000
Allied Signal, Inc. ............. 190,000 9,025,000
-------------
TOTAL DIVERSIFIED (1.1%) ...... 16,325,000
-------------
TOTAL COMMON STOCKS (51.1%)
(Cost $682,448,018) ............ 778,269,041
-------------
PREFERRED STOCKS:
BASIC MATERIALS
METALS & MINING (0.1%)
Reynolds Metals Co.
7.0% Conv., 12/31/97 ........... 20,700 1,047,937
-------------
PAPER (0.0%)
James River Corp.
9.0% Conv. ..................... 19,300 451,138
-------------
TOTAL BASIC MATERIALS (0.1%) .. 1,499,075
-------------
CAPITAL GOODS (0.1%)
ELECTRICAL EQUIPMENT
Westinghouse Electric Corp.
$1.3 Conv.+ .................... 123,100 1,954,212
-------------
CONSUMER CYCLICALS (0.1%)
AIRLINES
Continental Air Finance Trust
8.5% Conv.+ .................... 28,200 1,508,700
-------------
CONSUMER NONCYCLICALS (0.1%)
HOSPITAL SUPPLIES & SERVICES
FHP International Corp.
5.0% Conv. Series A ............ 46,700 1,243,388
-------------
</TABLE>
42
<PAGE>
THE HUDSON RIVER TRUST
BALANCED PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ------------ -------------
<S> <C> <C>
PREFERRED STOCKS (Continued):
CREDIT SENSITIVE
BANKS (0.1%)
First Chicago NBD Corp.
5.75% Conv. Series B ........... 28,300 $ 1,896,100
-------------
FINANCIAL SERVICES (0.1%)
Allstate Corp.
$2.3 Conv. ..................... 22,000 902,000
First USA
$6.25% Conv. ................... 31,200 1,232,400
-------------
2,134,400
-------------
INSURANCE (0.1%)
Travelers Group, Inc.
5.5% Conv. Series B ............ 16,100 1,404,725
-------------
UTILITY--TELEPHONE (0.2%)
LCI International, Inc.
5.0% Conv. ..................... 55,000 2,942,500
-------------
TOTAL CREDIT SENSITIVE (0.5%) . 8,377,725
-------------
ENERGY (0.1%)
OIL--DOMESTIC
ENRON Corp.
6.25% Conv.* ................... 42,100 1,010,400
-------------
TOTAL PREFERRED STOCKS (1.0%)
(Cost $13,943,336) ............. 15,593,500
-------------
PRINCIPAL
AMOUNT
------------
LONG-TERM DEBT SECURITIES:
BUSINESS SERVICES
ENVIRONMENTAL CONTROL (0.2%)
Thermo Electron Corp.
5.0% Euro Conv., 04/15/01 ..... $ 2,115,000 3,579,638
-------------
PRINTING, PUBLISHING &
BROADCASTING (2.6%)
Tele-Communications, Inc.
10.125%, 04/15/22 .............. 17,325,000 21,706,146
Time Warner Entertainment Co.
8.375%, 03/15/23 ............... 16,350,000 17,600,939
-------------
39,307,085
-------------
PROFESSIONAL SERVICES (0.4%)
Career Horizons, Inc.
7.0% Conv., 11/01/02+ .......... 805,000 915,688
Danka Business Systems PLC
6.75% Conv., 04/01/02 .......... 1,600,000 2,266,000
First Financial Management Corp.
5.0% Conv., 12/15/99 ........... 1,815,000 2,944,838
-------------
6,126,526
-------------
TOTAL BUSINESS SERVICES (3.2%) 49,013,249
-------------
CAPITAL GOODS
MACHINERY (0.4%)
Solectron Corp.
Zero Coupon Conv. Sub. Note,
05/05/12 ....................... 4,050,000 3,715,875
Titan Wheel International, Inc.
4.75% Conv., 12/01/00 .......... 1,425,000 1,882,781
-------------
TOTAL CAPITAL GOODS (0.4%) .... 5,598,656
-------------
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ---------------------------------- ------------- --------------
LONG-TERM DEBT SECURITIES
(Continued):
CONSUMER CYCLICALS
FOOD SERVICES, LODGING (0.1%)
HFS, Inc.
4.5% Conv., 10/01/99 ............. $ 735,000 $1,697,850
--------------
RETAIL--GENERAL (0.2%)
Federated Department Stores, Inc.
5.0% Conv., 10/01/03 ............. 1,110,000 1,110,000
Lowes Cos., Inc.
3.0% Conv., 07/22/03 ............. 1,165,000 1,518,868
--------------
2,628,868
--------------
TOTAL CONSUMER CYCLICALS (0.3%) 4,326,718
--------------
CONSUMER NONCYCLICALS
DRUGS (0.1%)
Genzyme Corp.
6.75% Conv., 10/01/01 ............ 910,000 1,131,812
--------------
HOSPITAL SUPPLIES & SERVICES (0.3%)
Healthsouth Corp.
5.0% Conv., 04/01/01 ............. 1,150,000 1,857,250
Integrated Health Services
5.75% Conv., 01/01/01+ ........... 2,245,000 2,259,031
Omnicare, Inc.
5.75% Conv., 10/01/03 ............ 155,000 480,888
--------------
4,597,169
--------------
TOTAL CONSUMER NONCYCLICALS (0.4%) 5,728,981
--------------
CREDIT SENSITIVE
BANKS (0.6%)
Abbey National PLC
6.69%, 10/17/05 .................. 8,750,000 9,081,013
--------------
FINANCIAL SERVICES (4.6%)
Commercial Credit Co.
6.125%, 12/01/05 ................. 10,000,000 9,903,990
Farmers Insurance Exchange
8.5%, 08/01/04 ................... 19,750,000 20,758,633
Lehman Brothers Holdings, Inc.
8.5%, 05/01/07 ................... 19,000,000 21,320,280
Liberty Mutual Insurance Co.
8.5%, 05/15/25 ................... 14,375,000 15,998,800
Medaphis Corp.
6.5% Conv., 01/01/00+ ............ 840,000 2,233,350
--------------
70,215,053
--------------
FOREIGN GOVERNMENT (1.3%)
Italy Global Bond
6.875%, 09/27/23 ................. 20,000,000 19,531,000
--------------
MORTGAGE RELATED (2.9%)
Federal National Mortgage
Association
6.0%, 06/01/09 ................... 46,326,416 45,214,582
--------------
U.S. GOVERNMENT (24.7%)
U.S. Treasury
5.625% Note, 06/30/97 ............ 68,000,000 68,446,212
7.25% Note, 02/15/98 ............. 42,800,000 44,498,606
5.875% Note, 08/15/98 ............ 25,000,000 25,390,625
7.75% Note, 12/31/99 ............. 50,400,000 54,715,500
7.75% Note, 01/31/00 ............. 56,000,000 60,847,470
6.75% Note, 04/30/00 ............. 35,600,000 37,469,000
5.75% Note, 10/31/00 ............. 45,000,000 45,689,040
</TABLE>
43
<PAGE>
THE HUDSON RIVER TRUST
BALANCED PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ---------------------------------- ------------- --------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES
(Continued):
6.5% Note, 08/15/05 .............. $13,730,000 $ 14,626,734
7.625% Bond, 02/15/25 ............ 6,755,000 8,253,766
6.875% Bond, 08/15/25 ............ 14,000,000 15,793,750
--------------
375,730,703
--------------
UTILITY--ELECTRIC (1.1%)
GG1B Funding Corp.
7.43%, 01/15/11 .................. 17,612,675 17,641,560
--------------
UTILITY--TELEPHONE (0.2%)
Worldcom, Inc.
5.0% Conv., 08/15/03 ............. 2,345,000 2,485,700
--------------
TOTAL CREDIT SENSITIVE (35.4%) .. 539,899,611
--------------
TECHNOLOGY
ELECTRONICS (0.8%)
Altera Corp.
5.75% Conv. Sub. Note, 06/15/02+ 1,165,000 1,357,225
Cypress Semiconductor Corp.
3.15% Conv., 03/15/01+ ........... 855,000 869,963
Integrated Device Technology, Inc.
5.5% Conv., 06/01/02 ............. 1,630,000 1,332,525
LSI Logic Corp.
5.5% Conv., 03/15/01+ ............ 595,000 1,614,681
Lam Research Corp.
6.0% Conv. Sub. Deb., 05/01/03 .. 1,005,000 1,866,788
Motorola, Inc.
Zero Coupon Conv., 09/27/13 ..... 455,000 346,938
Sanmina Corporation
5.5% Conv., 08/15/02+ ............ 1,815,000 1,985,156
3Com Corp.
10.25% Conv., 11/01/01+ .......... 1,415,000 2,260,463
--------------
11,633,739
--------------
TELECOMMUNICATIONS (0.3%)
Bay Networks, Inc.
5.25% Conv., 05/15/03+ ........... 2,055,000 2,224,538
U.S. Cellular Corp.
Zero Coupon Conv. 06/15/15 ....... 7,120,000 2,509,800
--------------
4,734,338
--------------
TOTAL TECHNOLOGY (1.1%) .......... 16,368,077
--------------
TOTAL LONG-TERM DEBT SECURITIES (40.8%)
(Amortized Cost $597,595,463) ... 620,935,292
--------------
SHORT-TERM DEBT SECURITIES:
CERTIFICATES OF DEPOSIT
Mitsubishi Bank Ltd.--N.Y.
6.0%, due 02/29/96 ............... $15,000,000 $ 15,003,063
Norinchuckin Bank Ltd.
5.84%, due 03/11/96 .............. 15,000,000 15,011,969
National Westminster Bank--USA
5.81%, due 01/22/96 .............. 6,000,000 6,000,000
--------------
TOTAL CERTIFICATES OF DEPOSIT (2.4%) 36,015,032
--------------
COMMERCIAL PAPER
Alamo Funding
5.75%, due 02/02/96 .............. 5,000,000 4,972,847
ASI Funding Corp.:
5.715%, due 02/02/96 ............. 5,000,000 4,973,012
5.73%, due 02/02/96 .............. 2,500,000 2,486,471
Corporate Asset Funding Co., Inc.
5.9%, due 01/02/96 ............... 8,100,000 8,096,018
General Electric Capital Corp.
5.58%, due 03/08/96 .............. 5,000,000 4,948,729
Greenwich Funding
5.72%, due 02/09/96 .............. 14,400,000 14,306,192
Hanson PLC
5.7%, due 01/26/96 ............... 7,500,000 7,467,938
Province of British Columbia
5.61%, due 03/15/96 .............. 1,500,000 1,483,090
Riverwood Funding Corp.
5.7%, due 02/13/96 ............... 5,000,000 4,964,375
--------------
TOTAL COMMERCIAL PAPER (3.5%) 53,698,672
--------------
TOTAL SHORT-TERM DEBT SECURITIES (5.9%)
(Amortized Cost $89,695,232) .... 89,713,704
--------------
TOTAL INVESTMENTS (98.8%)
(Cost/Amortized Cost $1,383,682,049) 1,504,511,537
CASH AND RECEIVABLES
LESS LIABILITIES (1.2%) .......... 18,630,191
--------------
NET ASSETS (100.0%) ............... $1,523,141,728
==============
</TABLE>
- ------------
* Non-income producing.
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
See Notes to Financial Statements.
44
<PAGE>
THE HUDSON RIVER TRUST
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS:
BASIC MATERIALS
CHEMICALS (2.3%)
Air Products & Chemicals, Inc. . 60,000 $ 3,165,000
Bayer AG ........................ 500 132,762
Dainippon Ink & Chemical, Inc. . 20,000 93,172
Hercules, Inc. .................. 300,000 16,912,500
Indo Gulf Fertilisers (GDR) .... 50,000 65,000
Ishihara Sangyo Ltd.* ........... 88,000 285,521
Sanyo Chemicals ................. 4,000 38,005
Sekisui Chemical Co. Ltd. ...... 19,000 279,709
--------------------------
20,971,669
--------------------------
CHEMICALS--SPECIALTY (0.2%)
SGL Carbon AG*+ ................. 15,000 1,171,426
UCAR International, Inc.* ...... 8,000 270,000
--------------------------
1,441,426
--------------------------
METALS & MINING (1.0%)
Aluminum Co. of America ......... 160,000 8,460,000
Biron Corp.* .................... 80,000 26,757
Gwalia Consolidated ............. 95,800 163,768
--------------------------
8,650,525
--------------------------
PAPER (0.1%)
Asia Pacific Resources
International Holdings Ltd.
(Class A)* ..................... 5,000 23,750
Enso-Gutzeit, Series R .......... 30,000 200,010
Fletcher Forestry Shares ........ 4,256 6,066
Grupo Industrial Durango (ADR)* 12,000 79,500
Mayr-Melnhof Karten Aktien+ .... 1,500 75,070
Nippon Paper Industries ......... 26,000 180,552
Oji Paper ....................... 30,000 271,380
--------------------------
836,328
--------------------------
STEEL (0.1%)
Acerinox S.A. ................... 500 50,490
British Steel ................... 50,000 126,416
Hitachi Metals Ltd. ............. 15,000 187,409
SSAB Svenskt Stal (Class B) .... 20,000 201,738
Sumitomo Metal Industries* ..... 140,000 424,407
--------------------------
990,460
--------------------------
TOTAL BASIC MATERIALS (3.7%) .. 32,890,408
--------------------------
BUSINESS SERVICES
ENVIRONMENTAL CONTROL (0.2%)
Powerscreen International ...... 65,000 391,288
Tomra Systems ................... 120,000 947,924
--------------------------
1,339,212
--------------------------
PRINTING, PUBLISHING &
BROADCASTING (0.3%)
Carlton Communications PLC ..... 20,000 300,136
Elsevier ........................ 45,000 599,976
Mirror Group Newspapers PLC .... 40,000 109,366
Nippon Television Network ...... 1,880 502,547
Oriental Press Group ............ 200,000 60,782
Reed International .............. 10,000 152,554
Sunshine Broadcasting Network .. 27,000 34,115
Toppan Printing Co. ............. 35,000 461,017
COMMON STOCKS (Continued):
United Newspapers PLC ........... 10,000 $ 86,219
Ver Ned Uitgevers ............... 2,500 343,133
--------------------------
2,649,845
--------------------------
PROFESSIONAL SERVICES (1.2%)
Apcoa Parking AG* ............... 3,000 197,678
Asatsu, Inc. .................... 7,600 319,458
Automated Security Holdings* ... 51,041 21,409
Randstadt Holdings N.V. ......... 3,000 136,069
Reynolds & Reynolds Co. ......... 260,000 10,107,500
Secom Co. ....................... 1,000 69,540
WPP Group PLC ................... 50,000 127,387
--------------------------
10,979,041
--------------------------
TRUCKING, SHIPPING (0.1%)
Autostrade Conc E Costr-Priv ... 30,000 32,872
Brambles Industries Ltd. ........ 15,000 167,231
Irish Continental Group ......... 30,000 225,645
Kawasaki Kisen* ................. 85,000 270,024
Western Bulk Shipping+ .......... 31,500 144,321
Yamato Transport ................ 4,000 47,651
--------------------------
887,744
--------------------------
TOTAL BUSINESS SERVICES (1.8%) 15,855,842
--------------------------
CAPITAL GOODS
BUILDING & CONSTRUCTION (0.4%)
BBC Brown Boveri ................ 350 406,412
Bufete Industrial S.A. (ADS)* .. 2,700 40,500
Chloride Group .................. 230,000 83,073
Fomento de Construcciones Y
Contratas S.A. ................. 500 38,269
Fukuda Corp. .................... 12,000 108,668
Japan Industrial Land* .......... 6,000 230,702
Kanamoto--Rights* ............... 200 0
Kanamoto Co. Ltd. ............... 2,200 28,552
Kaneshita Construction .......... 18,000 242,324
Kvaerner AS (Series A)* ......... 500 19,748
Macmahon Holdings Ltd. .......... 700,000 343,382
Nanno Construction Co. Ltd.* ... 20,000 224,697
National House Industrial ...... 3,000 54,915
Oriental Construction Co. ...... 4,000 85,230
Paul Y.-ITC Construction ........ 400,000 77,077
Paul Y.-ITC Construction--
Warrants* ...................... 80,000 2,478
Penta Ocean Construction ........ 20,000 154,964
PS Corp. ........................ 14,000 254,915
Royal Plastics Group Ltd.*+ .... 10,000 144,630
Sho Bond Construction ........... 9,000 302,470
Toda Construction ............... 24,000 208,039
Wesco, Inc. ..................... 7,500 181,598
--------------------------
3,232,643
--------------------------
BUILDING MATERIALS
& FOREST PRODUCTS (0.1%)
Advan Co.* ...................... 7,000 183,051
C.I. Holdings BHD ............... 21,000 74,418
Lafarge Canada .................. 3,000 55,198
Lafarge Corp. ................... 3,300 212,871
Nichiha ......................... 11,000 249,298
--------------------------
774,836
--------------------------
</TABLE>
45
<PAGE>
THE HUDSON RIVER TRUST
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
ELECTRICAL EQUIPMENT (1.7%)
General Electric Co. ............ 200,000 $14,400,000
Omron Corp. ..................... 15,000 345,763
Vae Eisenbahnsys ................ 1,633 137,559
--------------------------
14,883,322
--------------------------
MACHINERY (1.0%)
Asahi Diamond Industry Co. Ltd. 5,000 70,218
Construcciones Auxiliar Ferro .. 3,000 106,166
Deere & Co. ..................... 180,000 6,345,000
Fag Kugelfischer Georg Schaefer* 400 51,320
IHC Caland* ..................... 10,000 336,435
Kalmar Industries AB+ ........... 12,000 197,824
Keppel Corp. .................... 18,000 160,339
Keyence Corp. ................... 4,500 518,644
Kurita Water Industries ......... 3,000 79,903
Mitsubishi Heavy Industries Ltd. 60,000 478,257
Nippon Seiko K.K. ............... 31,000 225,182
SMC Corp. ....................... 6,000 434,092
Yaskawa Electric Corp.* ......... 55,000 259,419
--------------------------
9,262,799
--------------------------
TOTAL CAPITAL GOODS (3.2%) .... 28,153,600
--------------------------
CONSUMER CYCLICALS
AIRLINES (0.4%)
Air New Zealand Limted 'B'
Shares ......................... 50,000 169,975
British Airways ................. 40,000 289,572
Delta Air Lines, Inc. ........... 40,000 2,955,000
KLM ............................. 14,000 491,943
--------------------------
3,906,490
--------------------------
APPAREL, TEXTILE (0.1%)
Adidas AG*+ ..................... 12,400 652,791
Teijin Ltd. ..................... 9,000 46,024
--------------------------
698,815
--------------------------
AUTOS & TRUCKS (0.1%)
Honda Motor Corp. ............... 32,000 660,145
Toyota Motor Co. ................ 5,000 106,053
Volvo AB (Series B) ............. 5,000 102,375
--------------------------
868,573
--------------------------
AUTO RELATED (0.1%)
Autoliv AB ...................... 3,000 175,241
Autoliv AB (ADS)*+ .............. 3,000 174,375
Mabuchi Motor ................... 7,000 435,254
Minebea Co. ..................... 32,000 268,397
NGK Spark Plug Co. .............. 8,000 100,726
Pacific Dunlop .................. 10,000 23,412
--------------------------
1,177,405
--------------------------
FOOD SERVICES, LODGING (2.4%)
AAPC Limited .................... 400,000 217,029
Marriott International, Inc. ... 240,000 9,180,000
McDonald's Corp. ................ 260,000 11,732,500
QPQ Corporation* ................ 16,400 30,750
QPQ Corporation--Warrants* ..... 16,400 7,688
--------------------------
21,167,967
--------------------------
HOUSEHOLD FURNITURE, APPLIANCES (0.2%)
Alpine Electronics .............. 15,000 $ 252,785
Atag Holdings ................... 800 52,833
Industrie Natuzzi (ADR) ......... 8,000 363,000
Maax, Inc.* ..................... 22,000 161,107
Matsushita Electric Industries . 13,000 211,525
Nippon Electric Glass ........... 20,000 379,661
Noritz Co. ...................... 1,000 16,271
Philips Electronics ............. 3,500 126,475
Philips Electronics N.V. (ADR) . 3,000 107,625
--------------------------
1,671,282
--------------------------
LEISURE RELATED (1.0%)
Cinar Films, Inc. (Class B)* ... 25,000 378,125
CUC International, Inc.* ........ 240,000 8,190,000
Helicopter Line Ltd. ............ 70,000 151,016
Nelvana Limited*+ ............... 18,000 250,449
Rank Organisation PLC ........... 20,000 144,786
Skis Rossignol .................. 100 27,438
--------------------------
9,141,814
--------------------------
PHOTO & OPTICAL (1.0%)
Eastman Kodak Co. ............... 140,000 9,380,000
--------------------------
RETAIL--GENERAL (1.5%)
Centros Comerciales Pryca S.A. . 11,350 237,726
Chiyoda Co.* .................... 10,000 232,446
Consolidated Stores Corp.* ..... 40,000 870,000
Dollar General Corp. ............ 100,000 2,075,000
Doshisha Co.* ................... 14,000 497,627
Eidensha Co. Ltd. ............... 12,000 151,090
Eye Care Centers of
America--Warrants* ............. 500 5,000
Fu Hui Jewellery * .............. 382,000 14,821
Homac Corp. ..................... 1,100 19,496
Matsuyadenki Co. Industries .... 7,000 82,712
Morrison (Wm.) Supermarkets .... 10,000 22,060
Nissen Corp. Ltd. ............... 7,700 180,475
Office Depot, Inc.* ............. 120,000 2,370,000
Paris Miki, Inc.* ............... 10,700 384,475
Rinascente ...................... 13,000 78,673
Rite Aid Corp. .................. 160,000 5,480,000
Sato Corp. ...................... 7,000 183,729
Shimamura Co. Ltd. .............. 7,000 270,508
Swank International
Manufacturing .................. 400,000 46,039
Xebio Co. ....................... 6,000 212,107
--------------------------
13,413,984
--------------------------
TOTAL CONSUMER CYCLICALS (6.8%) 61,426,330
--------------------------
CONSUMER NONCYCLICALS
BEVERAGES (1.5%)
Coca-Cola Co. ................... 180,000 13,365,000
Grand Metropolitan .............. 42,000 302,746
Lion Nathan Ltd. ................ 80,000 190,895
Panamerican Beverages ........... 2,000 64,000
--------------------------
13,922,641
--------------------------
FOODS (1.0%)
Fyffes PLC* ..................... 100,000 172,835
IBP, Inc. ....................... 160,000 8,080,000
</TABLE>
46
<PAGE>
THE HUDSON RIVER TRUST
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
NV (Verenigde Bed) Nutricia*+ .. 2,600 $ 210,259
Shriram Industrial Enterprises
Ltd. (GDR)+ .................... 24,000 78,000
Shriram Industrial
Enterprises Ltd.--Warrants* ... 8,000 80
Viscofan Envoltura .............. 9,000 106,659
--------------------------
8,647,833
--------------------------
CONTAINERS (0.3%)
Sealed Air Corp.* ............... 80,000 2,250,000
--------------------------
DRUGS (2.9%)
Astra AB (Series A) ............. 15,000 598,440
Cochlear Ltd.*+ ................. 162,100 349,394
Merck KGAA*+ .................... 6,000 245,999
Novo-Nordisk AS ................. 2,500 342,111
Pfizer, Inc. .................... 350,000 22,050,000
Roche Holdings AG Genusscheine . 80 632,582
Sankyo Co. ...................... 20,000 449,395
Sankyo Co.--Rights* ............. 3,300 0
Santen Pharmaceutical Co. ...... 20,000 453,269
Schwarz Pharma AG* .............. 2,000 98,734
Taisho Pharmaceutical ........... 16,000 316,126
Takeda Chemical Industries ..... 3,000 49,395
Yamanouchi Pharmaceutical ...... 14,000 301,017
Zeneca Group PLC ................ 30,000 580,698
--------------------------
26,467,160
--------------------------
HOSPITAL SUPPLIES & SERVICES (4.0%)
Cardinal Health, Inc. ........... 120,000 6,570,000
Healthcare Compare Corp.* ...... 160,000 6,960,000
Medtronic, Inc. ................. 380,000 21,232,500
Scandinavian Mobility
International*+ ................ 27,600 660,959
Tamro Group ..................... 20,000 87,821
Wright Medical Technology,
Inc.--Warrants* ................ 206 33,990
--------------------------
35,545,270
--------------------------
RETAIL--FOOD (0.1%)
Casino Guichard-Perrachon* ..... 4,002 116,272
Seven-Eleven Japan Ltd. ......... 5,000 352,542
York-Benimaru Co. ............... 1,000 38,257
--------------------------
507,071
--------------------------
SOAPS & TOILETRIES (2.3%)
Gillette Corp. .................. 400,000 20,850,000
McBride PLC*+ ................... 60,000 181,760
--------------------------
21,031,760
--------------------------
TOBACCO (2.8%)
Philip Morris Cos., Inc. ........ 260,000 23,530,000
UST, Inc. ....................... 60,000 2,002,500
--------------------------
25,532,500
--------------------------
TOTAL CONSUMER NONCYCLICALS (14.9%) 133,904,235
--------------------------
CREDIT SENSITIVE
BANKS (5.3%)
Advance Bank of Australia ...... 40,000 320,489
Akita Bank ...................... 10,000 78,547
Asahi Bank Ltd. ................. 6,000 75,545
Banco Latinoamericano de
Exportaciones, S.A. ............ 9,500 $ 441,750
Banco Osorno Y La Union (ADR) .. 16,000 222,000
Banco Popular ................... 1,200 220,923
Bancomer B Local* ............... 50,000 13,934
Bank of New York Co. ............ 480,000 23,400,000
Bankgesellschaft Berliner* ..... 300 76,561
Barclays Bank ................... 30,000 344,411
Citicorp. ....................... 200,000 13,450,000
First Bank Systems .............. 140,000 6,947,500
Fokus Bank* ..................... 8,000 43,289
Grupo Financiero Bancorte (Class
B)* ............................ 18,000 16,752
Hock Hua Bank ................... 30,000 85,049
HSBC Holding PLC ................ 20,000 302,619
International Bank of Asia ..... 270,000 128,322
Mitsubishi Bank ................. 11,000 258,886
Mitsubishi Trust & Banking ..... 22,000 366,489
Nordbanken AB*+ ................. 6,200 107,343
Overseas Chinese Bank ........... 5,000 62,566
Overseas Union Bank Ltd. ........ 22,000 151,644
Schweiz Bankverein .............. 270 110,199
Toho Bank ....................... 10,000 72,155
Yamanashi Chuo Bank ............. 8,000 79,806
--------------------------
47,376,779
--------------------------
FINANCIAL SERVICES (0.8%)
American Express Co. ............ 120,000 4,965,000
Credit Local de France .......... 3,500 280,515
Credit Saison Co. ............... 15,000 357,385
Hong Leong Finance .............. 50,000 142,100
Invesco ......................... 60,000 236,287
JCG Holdings .................... 60,000 43,841
Nichiei Co. Ltd. ................ 6,000 447,458
Promise Co. Ltd. ................ 6,000 288,814
Sanyo Shinpan Finance Co. Ltd. . 4,500 370,460
Yamaichi Securities ............. 50,000 388,862
--------------------------
7,520,722
--------------------------
INSURANCE (3.4%)
Aegon N.V. ...................... 15,000 663,525
AFLAC, Inc. ..................... 160,000 6,940,000
Corporacion Mapfre Cia Inter ... 7,100 396,755
Fortis Amev N.V. ................ 6,800 455,433
General Re Corp. ................ 140,000 21,700,000
Koa Fire & Marine ............... 30,000 183,632
--------------------------
30,339,345
--------------------------
REAL ESTATE (0.1%)
Cheung Kong Holdings ............ 30,000 182,735
Chubu Sekiwa Real Estate ........ 4,000 61,985
Daibiru Corp. ................... 7,000 79,322
Hong Kong Land Holding .......... 100,000 184,998
Mitsubishi Estate Co. ........... 11,000 137,433
--------------------------
646,473
--------------------------
UTILITY--ELECTRIC (0.1%)
Enersis S.A. (ADR) .............. 6,000 171,000
EVN ............................. 1,000 137,256
</TABLE>
47
<PAGE>
THE HUDSON RIVER TRUST
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Hidroelectrica del Cantabrico .. 2,000 $ 69,131
Powergen PLC (ADR) .............. 1,250 42,500
Veba AG ......................... 9,000 382,805
--------------------------
802,692
--------------------------
UTILITY--GAS (0.7%)
ENRON Corp. ..................... 160,000 6,100,000
--------------------------
UTILITY--TELEPHONE (2.1%)
Cincinnati Bell, Inc. ........... 70,000 2,432,500
Kon PTT Nederland+ .............. 7,000 254,258
Nippon Telegraph & Telephone
Corp. .......................... 33 266,877
NYNEX Corp. ..................... 280,100 15,125,400
PT Indonesian Satellite (ADR) .. 6,000 219,000
Stet-Societa Finanziaria
Telefonica (ADR) ............... 30,000 84,826
Tele Danmark AS, (B Shares) .... 8,000 436,462
Telefonica de Espana SA ......... 12,000 165,915
--------------------------
18,985,238
--------------------------
TOTAL CREDIT SENSITIVE (12.5%) 111,771,249
--------------------------
ENERGY
OIL--DOMESTIC (1.1%)
Amoco Corp. ..................... 140,000 10,062,500
XCL Corp. * ..................... 200,000 75,000
--------------------------
10,137,500
--------------------------
OIL--INTERNATIONAL (1.2%)
Ampolex Ltd.* ................... 15,000 32,777
Canadian Occidental ............. 3,000 98,250
ENI Spa* ........................ 91,000 318,049
Mobil Corp. ..................... 80,000 8,960,000
Omv AG .......................... 5,000 433,572
Repsol SA ....................... 10,000 327,138
Yukong Ltd. (GDS)* .............. 838 14,559
Yukong Ltd. (GDR)*+ ............. 7,000 63,000
--------------------------
10,247,345
--------------------------
OIL--SUPPLIES & CONSTRUCTION (0.0%)
Coflexip (ADR) .................. 11,000 207,628
--------------------------
RAILROADS (0.2%)
Hankyu Corp. .................... 24,000 131,332
Illinois Central Corp. .......... 40,000 1,535,000
--------------------------
1,666,332
--------------------------
TOTAL ENERGY (2.5%) ............ 22,258,805
--------------------------
TECHNOLOGY
ELECTRONICS (3.9%)
Applied Materials, Inc.* ........ 100,000 3,937,500
ASM Lithography Holding N.V.* .. 1,500 51,867
Austria Mikro Systeme
International+ ................. 1,660 268,973
Aval Data* ...................... 8,000 150,315
Futaba Corp. .................... 1,000 45,811
GP Batteries International ..... 143,000 344,630
GP Batteries
International--Rights* ......... 5,750 2,875
Hirose Electric Co. Ltd. ........ 4,000 230,121
Hoya Corp. ...................... 10,000 343,826
Kyocera Corp. ................... 4,000 297,143
Linear Technology Corp. ......... 160,000 $ 6,280,000
Molex, Inc. ..................... 180,000 5,715,000
NEC Corp. ....................... 40,000 488,136
Nikon Corp. ..................... 16,000 216,949
Rohm Co. Ltd. ................... 9,000 508,184
TDK Corp. ....................... 8,000 408,329
Tokyo Electron .................. 10,000 387,409
Tyco International, Ltd. ........ 240,000 8,550,000
3Com Corp.* ..................... 150,000 6,993,750
--------------------------
35,220,818
--------------------------
OFFICE EQUIPMENT (0.9%)
Canon, Inc. ..................... 30,000 543,341
Fujitsu Ltd. .................... 4,000 44,552
Ricoh Elemex Corp. .............. 5,000 72,155
Sun Microsystems, Inc.* ......... 160,000 7,300,000
--------------------------
7,960,048
--------------------------
OFFICE EQUIPMENT SERVICES (1.7%)
Accugraph Corp. (Class A)* ..... 30,000 80,187
Getronics N.V. .................. 3,000 140,181
Istar Internet, Inc.*+ .......... 38,000 358,281
Merkantildata A/S ............... 10,000 112,171
Misys PLC* ...................... 20,000 177,099
Oracle Corp.* ................... 140,000 5,932,500
Paychex, Inc. ................... 160,000 7,980,000
--------------------------
14,780,419
--------------------------
TELECOMMUNICATIONS (0.9%)
ADC Telecommunications, Inc.* .. 140,000 5,110,000
BCE Mobile Communications, Inc.* 4,000 135,111
Bell Cablemedia PLC (ADR)* ..... 7,000 112,000
Cellular Communications Puerto
Rico, Inc.* .................... 3,600 99,900
Filtronic Comtek PLC ............ 170,000 1,309,911
Hong Kong Telecommunications
Ltd. ........................... 80,000 142,774
Mannesmann AG ................... 1,000 318,307
Rogers Cantel Mobile
Communications, Inc.
(Class B)* ..................... 6,000 158,178
Tokyo Broadcasting System ...... 21,000 345,763
Total Access Communication*+ ... 96,000 624,000
--------------------------
8,355,944
--------------------------
TOTAL TECHNOLOGY (7.4%) ........ 66,317,229
--------------------------
DIVERSIFIED
MISCELLANEOUS (0.4%)
Alba ............................ 2,000 122,955
Allied Signal, Inc. ............. 60,000 2,850,000
Austral Enterprises BHD ......... 33,333 59,324
Austral Enterprises BHD--Rights* 6,666 0
Crean (James) PLC--Units ........ 40,000 124,825
Hanson PLC ...................... 60,000 179,429
Indonesia Fund, Inc.* ........... 4,000 40,500
International UNP Holdings* .... 143,000 48,171
International UNP
Holdings--Warrants* ............ 125,000 6,032
</TABLE>
48
<PAGE>
THE HUDSON RIVER TRUST
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
NUMBER OF VALUE
SHARES (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
COMMON STOCKS (Continued):
Taiwan Fund ..................... 5,000 $ 102,500
Tomkins PLC ..................... 70,000 306,661
--------------------------
TOTAL DIVERSIFIED (0.4%) ...... 3,840,397
--------------------------
TOTAL COMMON STOCKS (53.2%)
(Cost $372,256,316) ............ 476,418,095
--------------------------
PREFERRED STOCKS:
CONSUMER CYCLICALS (0.0%)
RETAIL--GENERAL
Fielmann AG ..................... 4,200 217,300
--------------------------
TECHNOLOGY (0.1%)
TELECOMMUNICATIONS
Nokia Oy Cum .................... 12,000 471,748
--------------------------
TOTAL PREFERRED STOCKS (0.1%)
(Cost $298,990) ................ 689,048
--------------------------
PRINCIPAL
AMOUNT
-----------
LONG-TERM DEBT SECURITIES:
BASIC MATERIALS
CHEMICALS (0.4%)
Buckeye Cellulos Corp. 8.5%,
12/15/05 ....................... $ 500,000 516,250
G-I Holdings
Zero Coupon Sr. Disc. Note,
10/01/98 ....................... 1,000,000 775,000
Harris Chemical
10.75%, 10/15/03 ............... 500,000 457,500
Pioneer Americas Corp.
13.375%, 04/01/05 .............. 500,000 522,500
Sherritt Gordon
9.75%, 04/01/03 ................ 1,000,000 1,065,000
--------------------------
3,336,250
--------------------------
METALS & MINING (0.1%)
Great Lakes Carbon Corp.
10.0%, 01/01/06 ................ 500,000 512,500
International Wire Group
11.75%, 06/01/05 ............... 500,000 480,000
--------------------------
992,500
--------------------------
PAPER (0.4%)
Crown Paper Co.
11.0%, 09/01/05 ................ 500,000 437,500
Rapp International Finance
11.5%, 12/15/00 ................ 500,000 497,500
Repap New Brunswick
9.875%, 07/15/00 ............... 500,000 501,250
Repap Wisconsin
9.25%, 02/01/02 ................ 1,000,000 950,000
Williamhouse--Regency of
Delaware, Inc.
12.0%, 11/15/05+ ............... 1,000,000 1,037,500
--------------------------
3,423,750
--------------------------
STEEL (0.0%)
Algoma Steel
12.375%, 07/15/05 .............. 500,000 450,000
--------------------------
TOTAL BASIC MATERIALS (0.9%) .. 8,202,500
--------------------------
COMMON STOCKS (Continued)
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------- ------------ -------------
LONG-TERM DEBT SECURITIES
(Continued):
BUSINESS SERVICES
PRINTING, PUBLISHING & BROADCASTING (0.4%)
Act III Broadcasting, Inc.
10.25%, 12/15/05 .............. $ 500,000 $ 508,750
Continental Cablevision
8.3%, 05/15/06+ ............... 1,500,000 1,505,625
Fundy Cable Ltd.
11.0%, 11/15/05 ............... 500,000 520,000
Pegasus Media & Communications
12.5%, 07/01/05 ............... 500,000 495,000
-------------
3,029,375
-------------
TRUCKING, SHIPPING (0.2%)
Penn Traffic Co.
8.625%, 12/15/03 .............. 1,000,000 890,000
Stena AB
10.5%, 12/15/05 ............... 1,000,000 1,020,000
-------------
1,910,000
-------------
TOTAL BUSINESS SERVICES (0.6%) 4,939,375
-------------
CAPITAL GOODS
AEROSPACE (0.1%)
Howmet Corp.
10.0%, 12/01/03+ .............. 500,000 520,000
-------------
BUILDING & CONSTRUCTION (0.1%)
Boskalis Westminster
5.25% Conv., 06/01/00 ......... 900,000 546,707
-------------
MACHINERY (0.1%)
Specialty Equipment Cos., Inc.
11.375%, 12/01/03 ............. 1,000,000 1,015,000
-------------
TOTAL CAPITAL GOODS (0.3%) ... 2,081,707
-------------
CONSUMER CYCLICALS
APPAREL, TEXTILE (0.2%)
CMI Industries
9.5%, 10/01/03 ................ 1,000,000 810,000
Ithaca Industries
11.125%, 12/15/02 ............. 500,000 200,000
Tultex Corp.
10.625%, 03/15/05 ............. 500,000 512,500
-------------
1,522,500
-------------
HOUSEHOLD FURNITURE, APPLIANCES (0.0%)
Crain Industries 13.5%,
08/15/05+ ..................... 500,000 505,000
-------------
RETAIL--GENERAL (0.1%)
Eye Care Centers of America
12.0%, 10/01/03 ............... 500,000 465,000
Tag-Heuer International SA
12.0%, 12/15/05+ .............. 500,000 500,000
-------------
965,000
-------------
TOTAL CONSUMER CYCLICALS (0.3%) 2,992,500
-------------
CONSUMER NONCYCLICALS
FOODS (0.1%)
Carr-Gottstein Foods Co.
12.0%, 11/15/05+ .............. 500,000 505,000
Specialty Foods Corp.
11.125%, 10/01/02 ............. 500,000 485,000
-------------
990,000
-------------
</TABLE>
49
<PAGE>
THE HUDSON RIVER TRUST
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (Continued)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- -------------------------------- ----------- --------------------------
<S> <C> <C>
LONG-TERM DEBT SECURITIES
(Continued):
CONTAINERS (0.0%)
MVE, Inc.
12.5%, 02/15/02 ............... $ 500,000 $ 500,000
-------------
SOAPS & TOILETRIES (0.1%)
Revlon Worldwide
Zero Coupon, 03/15/98 ......... 1,000,000 742,500
-------------
TOTAL CONSUMER NONCYCLICALS (0.2%) 2,232,500
-------------
CREDIT SENSITIVE
BANKS (0.1%)
Firstbank Puerto Rico
7.625%, 12/15/05 .............. 500,000 494,375
-------------
FINANCIAL SERVICES (0.2%)
Tembec Finance Corp.
9.875%, 09/30/05 .............. 1,000,000 992,500
Trizec Finance Ltd.
10.875%, 10/15/05 ............. 1,000,000 1,025,000
-------------
2,017,500
-------------
GENERAL OBLIGATIONS (0.1%)
Paxson Communications Corp.
11.625%, 10/01/02+ ............ 1,000,000 1,015,000
-------------
REAL ESTATE (0.1%)
Scotsman Group
9.5%, 12/15/00 ................ 1,000,000 1,010,000
-------------
U.S. GOVERNMENT (33.1%)
U.S. Treasury:
5.625% Note, 06/30/97 ......... 27,200,000 27,378,486
7.25% Note, 02/15/98 .......... 30,200,000 31,398,547
7.75% Note, 12/31/99 .......... 16,780,000 18,216,788
6.75% Note, 04/30/00 .......... 31,250,000 32,890,625
6.125% Note, 09/30/00 ......... 25,000,000 25,781,250
6.5% Note, 08/15/05 ........... 46,190,000 49,206,761
6.875% Bond, 08/15/25 ......... 98,440,000 111,052,625
-------------
295,925,082
-------------
UTILITY--ELECTRIC (0.1%)
California Energy
9.875%, 06/30/03 .............. 1,000,000 1,050,000
-------------
UTILITY--TELEPHONE (0.1%)
Telewest Communications PLC
9.625%, 10/01/06 .............. 1,000,000 1,010,000
-------------
TOTAL CREDIT SENSITIVE (33.8%) 302,521,957
-------------
ENERGY
OIL--DOMESTIC (0.1%)
Clark USA, Inc.
10.875%, 12/01/05+ ............ 500,000 525,000
Gulf Canada Resources Ltd.
9.625%, 07/01/05 .............. 500,000 527,500
-------------
TOTAL ENERGY (0.1%) ........... 1,052,500
-------------
TECHNOLOGY
TELECOMMUNICATIONS (0.7%)
Cai Wireless Systems, Inc.
12.25%, 09/15/02 .............. 500,000 533,750
Century Communications
9.5% Sr. Note, 03/01/05 ....... $ 500,000 $ 516,250
Clearnet Communications
14.75%, 12/15/05 (a)(b) ....... 1,000,000 520,000
Communication & Power Corp.
12.0%, 08/01/05+ .............. 500,000 513,750
EZ Communications, Inc.
9.75%, 12/01/05 ............... 1,000,000 1,005,000
Fonorola, Inc.
12.5%, 08/15/02 ............... 500,000 525,000
Lenfest Communications
8.375%, 11/01/05 .............. 1,000,000 1,003,750
Nextel Communications
9.75%, 08/15/04 (b) ........... 1,500,000 813,750
Rogers Cablesystems Ltd.
10.0%, 12/01/07 ............... 500,000 538,750
-------------
TOTAL TECHNOLOGY (0.7%) ...... 5,970,000
-------------
DIVERSIFIED
MISCELLANEOUS (0.0%)
Brierley Investment Ltd.
9.0% Sub. Conv. Note, 06/30/98 14,000 10,434
Jordan Industries
10.375%, 08/01/03 ............. 500,000 445,000
-------------
TOTAL DIVERSIFIED (0.0%) ..... 455,434
-------------
TOTAL LONG-TERM DEBT SECURITIES (36.9%)
(Amortized Cost $316,597,087) 330,448,473
-------------
SHORT-TERM DEBT SECURITIES:
BANK NOTES (0.8%)
NationsBank Corp. 7.03%, due
02/09/96 ...................... 7,500,000 7,508,514
-------------
CERTIFICATES OF DEPOSIT (1.1%)
Mitsubishi Bank Ltd.-N.Y.
6.0%, due 02/29/96 ............ 10,000,000 10,002,042
-------------
COMMERCIAL PAPER (5.4%)
Alamo Funding
5.74%, due 02/08/96 ........... 5,000,000 4,968,111
Allianz of America Financial
5.66%, due 02/09/96 ........... 3,300,000 3,278,728
Beta Finance, Inc.
5.68%, due 02/02/96 ........... 5,300,000 5,271,568
Ciesco LP
5.8%, due 01/04/96 ............ 9,500,000 9,492,347
Dynamic Funding Corp.
6.08%, due 01/02/96 ........... 5,300,000 5,297,315
Hanson PLC
5.7%, due 01/26/96 ............ 6,600,000 6,571,785
Premium Funding
5.75%, due 02/09/96 ........... 10,000,000 9,934,514
5.67%, due 03/08/96 ........... 3,370,000 3,335,314
-------------
TOTAL COMMERCIAL PAPER (5.4%) 48,149,682
-------------
</TABLE>
50
<PAGE>
THE HUDSON RIVER TRUST
GROWTH INVESTORS PORTFOLIO
PORTFOLIO OF INVESTMENTS (Concluded)
December 31, 1995
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- -------------------------------- ----------- ----------------
<S> <C> <C>
SHORT-TERM DEBT SECURITIES
(Continued):
TIME DEPOSITS (0.2%)
Harris Trust & Savings
5.875%, due 01/02/96 ......... $1,800,000 $ 1,800,000
-------------
U.S. GOVERNMENT (0.4%)
Federal Home Loan Mortgage
Corp.
5.75%, due 01/02/96 .......... 3,850,000 3,848,155
-------------
TOTAL SHORT-TERM DEBT SECURITIES (7.9%)
(Amortized Cost $71,304,413) 71,308,393
-------------
TOTAL INVESTMENTS (98.1%)
(Cost/Amortized Cost $760,456,806) 878,864,009
CASH AND RECEIVABLES
LESS LIABILITIES (1.9%) ..... 17,269,851
-------------
NET ASSETS (100.0%) ........... $896,133,860
=============
</TABLE>
* Non-income producing.
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may only be resold to qualified institutional
buyers.
(a) Consists of more than one class of securities traded together as a
unit; generally bonds with attached stocks or warrants.
(b) Debt security initially issued in zero coupon form which converts to
coupon form at a specific rate and date.
See Notes to Financial Statements.
51
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS
December 31, 1995
1. Organization and Significant Accounting Policies
The Hudson River Trust (Trust) (successor to The Hudson River Fund, Inc.,
a Maryland corporation organized in 1984) was formed as a Massachusetts
business trust on July 10, 1987 and is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment
company. The Trust has thirteen Portfolios (Portfolios) currently in
operation: Money Market, Intermediate Government Securities, Quality Bond,
High Yield, Growth and Income, Equity Index, Common Stock, Global,
International, Aggressive Stock, Conservative Investors, Balanced and Growth
Investors. The investment objectives of each Portfolio are as follows:
Money Market Portfolio -- High level of current income, preserve its
assets and maintain liquidity. The Portfolio pursues this objective by
investing in primarily high quality U.S. dollar denominated money market
instruments.
Intermediate Government Securities Portfolio -- High current income
consistent with relative stability of principal through investment primarily
in debt securities issued or guaranteed as to principal and interest by the
U.S. Government or any of its agencies or instrumentalities.
Quality Bond Porfolio -- High current income consistent with preservation
of capital by investing primarily in investment grade fixed income
securities. The Portfolio reserves the right to invest in convertible debt
securities, preferred stocks and dividend-paying common stocks.
High Yield Portfolio -- High return by maximizing current income and, to
the extent consistent with that objective, capital appreciation. The
Portfolio pursues this objective by investing primarily in a diversified mix
of high yield, fixed income securities involving greater volatility of price
and risk of principal and income than high quality fixed income securities.
The medium and lower quality debt securities in which the Portfolio may
invest are known as "junk bonds."
Growth and Income Portfolio -- High total return through a combination of
current income and capital appreciation by investing primarily
income-producing common stocks and securities convertible into common stocks.
Equity Index Portfolio -- Total return before expenses that approximates
the total return performance of the Standard & Poor's Corporation 500 Index,
including reinvestment of dividends, at a risk level consistent with that of
the Index.
Common Stock Portfolio -- Long-term growth of its capital and increase
income. The Portfolio pursues this objective by investing primarily in common
stock and other equity-type instruments.
Global Portfolio -- Long-term growth of capital. The Portfolio pursues
this objective by investing primarily in equity securities of non-United
States companies as well as United States issuers.
International Portfolio -- Long-term growth of capital by investing
primarily in a diversified portfolio of equity securities selected
principally to permit participation in non-United States companies with
prospects for growth.
Aggressive Stock Portfolio -- Long-term growth of capital. The Portfolio
pursues this objective by investing primarily in common stocks and other
equity-type securities issued by quality small and intermediate sized
companies with strong growth prospects.
Conservative Investors Portfolio -- High total return without, in the
investment adviser's opinion, undue risk to principal. The Portfolio pursues
this objective by investing in a diversified mix of publicly traded equity
and debt securities.
Balanced Portfolio -- High return through both appreciation of capital and
current income. The Portfolio pursues this objective by investing in a
diversified portfolio of publicly traded equity and debt securities and
short-term money market instruments.
52
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
Growth Investors Portfolio -- Highest total return consistent with the
investment adviser's determination of reasonable risk. The Portfolio pursues
this objective by investing in a diversified mix of publicly traded equity
and fixed income securities, including at times common stocks issued by
intermediate and small-sized companies and at times fixed income securities
that are medium and lower equity debt securities known as "junk bonds."
Shares of the Trust are offered to separate accounts of The Equitable Life
Assurance Society of the United States (Equitable), a wholly-owned subsidiary
of The Equitable Companies Incorporated, Equitable Variable Life Insurance
Company (Equitable Variable), a wholly-owned subsidiary of the Equitable, and
to separate accounts of other insurance companies unaffiliated with Equitable
and Equitable Variable. Effective December 10, 1993 and December 14, 1994,
the Board of Trustees approved the establishment of the Equity Index and
International Portfolios, respectively. The Equity Index and International
Portfolios commenced operations on March 1, 1994 and April 3, 1995,
respectively, at an initial share value of $10.
On September 15, 1993, the Trustees approved an application for an order
of approval and exemption under the Investment Company Act of 1940 for filing
with the Securities and Exchange Commission (SEC) for the substitution of
shares of the Intermediate Government Securities Portfolio for shares of the
Short-Term World Income Portfolio (STWIP) (Substitution). On February 22,
1994, 289,703 shares of STWIP with a value of $2,582,814 (including no
unrealized appreciation or depreciation) were substituted for 254,893 shares
of Intermediate Government Securities Portfolio with a net asset value at the
date of substitution of $10.13 per share.
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. Actual results
could differ from those estimates.
The following is a summary of the significant accounting policies of the
Trust:
Stocks listed on national securities exchanges and certain
over-the-counter issues traded on the NASDAQ national market system are
valued at the last sale price, or, if there is no sale, at the latest
available bid price. Other unlisted stocks are valued at their last sale
price or, if no reported sale during the day, at a bid price estimated by a
broker.
Convertible preferred stocks listed on national securities exchanges are
valued as of their last sale price or, if there is no sale, at the latest
available bid price.
Convertible bonds and unlisted convertible preferred stocks are valued at
bid prices obtained from one or more of the major dealers in such securities.
Where there is a discrepancy between dealers, values may be adjusted based on
recent premium spreads to the underlying common stocks.
Mortgage backed and asset backed securities are valued at prices obtained
from a bond pricing service where available, or at a bid price obtained from
one or more of the major dealers in such securities. If a quoted price is
unavailable, an equivalent yield or yield spread quotes will be obtained from
a broker and converted to a price.
Purchased options, including options on futures, are valued at their last
bid price. Written options are valued at their last asked price.
Long-term corporate bonds are valued at prices obtained from a bond
pricing service of a major dealer in bonds when such prices are available;
however, when such prices are not available, such bonds are valued at a bid
price estimated by a broker.
U.S. Treasury securities and other obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities are valued at
representative quoted prices.
53
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
Foreign securities not traded directly, or in American Depository Receipt
(ADR) or similar form in the United States, are valued at representative
quoted prices in the currency of the country of origin.
Except for the Money Market Portfolio, short-term debt securities which
mature in 60 days or less are valued at amortized cost, which approximates
market value. Short-term debt securities which mature in more than 60 days
are valued at representative quoted prices. Short-term debt securities held
in the Money Market Portfolio are valued at representative quoted prices
regardless of the length of maturity.
Futures and forward contracts are valued at their last sale price or, if
there is no sale, at the latest available bid price.
Other securities, including restricted securities, and assets for which
market quotations are not readily available or for which valuation cannot be
provided, are valued at "fair value" as determined in good faith by the
Valuation Committee of the Board of Trustees.
Securities transactions are recorded on the trade date net of brokerage
fees, commissions, and transfer fees.
Interest income (including amortization of premium and discount on
securities using the effective yield method) is accrued daily. Dividend
income is recorded on the ex-dividend date.
Realized gains and losses on the sale of investments are computed on the
basis of the identified cost of the related investments sold.
The Board of Trustees has approved the lending of Portfolio securities,
through it's custodian bank Chase Manhattan Bank, N.A. (Chase) acting as
lending agent, to certain broker-dealers in exchange for negotiated lenders'
fees. Any such loan of portfolio securities will be continuously secured by
collateral at least equal to the value of the security loaned. All loans will
be collateralized in the form of cash or U.S. Government securities. Chase
will indemnify the Portfolios from any loss resulting from a borrower's
failure to return a loaned security when due. At December 31, 1995, the value
of securities loaned and cash collateral received were as follows:
<TABLE>
<CAPTION>
VALUE OF CASH
SECURITIES COLLATERAL
PORTFOLIO LOANED RECEIVED
- ---------------------------------- ------------- -------------
<S> <C> <C>
Intermediate Government Securities $ 6,492,875 $ 6,643,688
Quality Bond ...................... 19,809,132 20,985,500
High Yield ........................ 17,898,413 18,254,850
Growth and Income ................. 1,179,525 1,066,750
Equity Index ...................... 462,625 476,000
Common Stock ...................... 18,258,363 18,344,700
Global ............................ 32,200,575 34,167,000
International ..................... 355,466 375,100
Aggressive Stock .................. 65,958,738 65,963,300
Conservative Investors ............ 90,882,271 93,741,041
Balanced .......................... 155,564,647 160,627,359
Growth Investors .................. 175,250,230 181,639,018
</TABLE>
At December 31, 1995, the Growth and Income Portfolio had on loan a
security having a value of $843,150 and collateralized at $726,350.
Subsequent to year end, the Portfolio was furnished with additional
collateral to meet the minimum requirement until the security was returned.
Chase invests the cash collateral and retains a portion of the interest
earned. During the year ended December 31, 1995, the Intermediate Government
Securities, Quality Bond, High Yield, Growth and Income,
54
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
Equity Index, Common Stock, Global, International, Aggressive Stock,
Conservative Investors, Balanced and Growth Investors Portfolios received
$11,432, $8,015, $5,001, $459, $244, $8,519, $20,716, $189, $22,717, $72,882,
$117,251 and $120,212, respectively, of security loan fees, net of rebates
paid. Such net fees are included in interest income in the accompanying
Statements of Operations.
The books and records of the Trust are kept in U.S. dollars. Foreign
currency amounts are translated into U.S. dollars at the bid price last
quoted by a composite list of major U.S. banks at the following dates:
(i) market value of investment securities, other assets and
liabilities--at the valuation date.
(ii) purchase and sales of investment securities, income and expenses--at
the date of such transactions.
The Portfolios do not isolate that portion of the results of operations
resulting from changes in foreign exchange rates on investments from the
fluctuations arising from changes in market prices of securities held. Such
fluctuations are included with the net realized and unrealized gain or loss
from investments.
Net currency gains or losses realized and unrealized as a result of
differences between interest or dividends and withholding taxes recorded on
the Portfolio's books and the U.S. dollar equivalent amount actually received
or paid are presented under foreign currency transactions in the realized and
unrealized gains and losses section of the Statements of Operations.
The Trust intends to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute
substantially all of its net investment income and net realized capital gains
to shareholders of each Portfolio. Therefore, no Federal income tax provision
is required. Dividends from net investment income are declared and
distributed quarterly; dividends from net realized short-term and long-term
capital gains are declared and distributed annually to the shareholders of
the Portfolios to which such gains are attributable. All dividends are
reinvested in additional full and fractional Shares of the related
Portfolios. All dividends are distributed on a tax basis and as such, the
amounts may differ from financial statement investment income and realized
capital gains.
Options Written:
All Portfolios (except for the Money Market and Equity Index Portfolios)
may write (sell) covered options as a hedge to provide protection against
adverse movements in the price of securities in the portfolio or to enhance
investment performance. When a Portfolio writes an option, an amount equal to
the premium received by the Portfolio is recorded as a liability and is
subsequently adjusted on a daily basis to the current market price of the
option written. Premiums received from writing options which expire
unexercised are recognized as gains on the expiration date. In writing
options, a Portfolio must assume that the option may be exercised at any time
prior to the expiration of its obligation as a writer, and that in such
circumstances the net proceeds of the sale or cost of purchase of the
underlying securities pursuant to the call or put option may be substantially
below or above the prevailing market price. A Portfolio also has the
additional risk of not being able to enter into a closing purchase
transaction if a liquid secondary market does not exist and bears the risk of
unfavorable changes in the price of the financial instruments underlying the
options.
Futures and Forward Contracts:
Futures and forward contracts are agreements to buy or sell a security for
a set price in the future. A Portfolio may buy or sell futures and forward
contracts for the purpose of protecting its portfolio securities against
future changes in interest rates which might adversely affect the value of
the Portfolio's securities or the price of securities that it intends to
purchase at a later date. Initial margin deposits are made upon entering into
futures contracts and can be either in cash or treasury securities. During
the period the futures and forward contracts are open, changes in the market
price of the contract are recognized as unrealized gains or losses by
"marking-to-market" at the end of each trading day. Variation margin payments
on futures contracts are received or made, depending upon whether unrealized
gains or losses are incurred. When the contract is closed, the Portfolio
records a realized gain or loss equal to the difference between the proceeds
from (or cost of) the
55
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
closing transactions and the Portfolio's basis in the contract. Should
interest rates move unexpectedly, the Portfolio may not achieve the
anticipated benefits of the futures and forward contracts and may incur a
loss. The use of futures and forward contracts transactions involves the risk
of imperfect correlation in movements in the price of futures and forward
contracts, interest rates and the underlying hedged assets.
Limitations on Market and Credit Risk:
Written options, futures and forward contracts involve elements of both
market and credit risk in excess of the amounts reflected in the Statements
of Assets and Liabilities. The contract amounts of these written options,
futures and forward contracts reflect the extent of the Portfolio's exposure
to off-balance sheet risk. The Portfolio bears the market risk which arises
from any changes in security values. The credit risk for futures contracts is
limited to failure of the exchange or board of trade which acts as the
counterparty to the Portfolio's futures transactions. Forward contracts are
done directly with the counterparty and not through an exchange and can be
terminated only by agreement of both parties to the contract. There is no
daily margin settlement and the Portfolio is exposed to the risk of default
by the counterparty.
Statement of Position 93-2:
For the year ended December 31, 1995, in conformity with Statement of
Position 93-2 Determination, Disclosure and Financial Statement Presentation
of Income, Capital Gain, and Return of Capital Distributions by Investment
Companies, the reclassification arising from current book/tax differences
resulted in increases (decreases) to the components of net assets as follows:
<TABLE>
<CAPTION>
EQUITY
QUALITY BOND HIGH YIELD INDEX COMMON STOCK GLOBAL
PORTFOLIO PORTFOLIO PORTFOLIO PORTOFLIO PORTFOLIO
------------ ------------ ----------- -------------- ------------
<S> <C> <C> <C> <C> <C>
Paid-in capital ..................... $(198,410) $ (10,868) $ (123) $ (1,132,224) $(546,316)
Undistributed (overdistributed) net
investment income .................. (737,714) 414,377 (7,126) 11,261,237 483,506
Accumulated net realized gain (loss) 936,124 (403,509) 7,249 (10,129,013) 62,810
</TABLE>
<TABLE>
<CAPTION>
AGGRESSIVE CONSERVATIVE GROWTH
INTERNATIONAL STOCK INVESTORS BALANCED INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
--------------- ------------ -------------- ------------ -----------
<S> <C> <C> <C> <C> <C>
Paid-in capital ................ $ -- $(790,113) $(875) $(172,395) $ (2,453)
Undistributed (overdistributed)
net investment income ......... 246,525 26,778 -- (91,058) 388,829
Accumulated net realized gain
(loss) ........................ (246,525) 763,335 875 263,453 (386,376)
</TABLE>
56
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
2. Management of the Trust
Alliance Capital Management L.P. (Alliance), a publicly traded limited
partnership, indirectly majority- owned by Equitable, is the investment
adviser. The investment advisory fees are as follows:
<TABLE>
<CAPTION>
DAILY AVERAGE NET ASSETS
--------------------------------
FIRST NEXT OVER
$350 MILLION $400 MILLION $750 MILLION
---------------- ---------------- ----------------
<S> <C> <C> <C>
Common Stock, Money Market and Balanced Portfolios ....... .40% .375% .35%
Aggressive Stock and Intermediate Government Securities ..
Portfolios ............................................... .50% .475% .45%
High Yield, Global, Conservative Investors and Growth
Investors Portfolios ..................................... .55% .525% .50%
FIRST NEXT OVER
$500 MILLION $500 MILLION $1 BILLION
---------------- ---------------- ----------------
Quality Bond and Growth and Income Portfolios ............. .55% .525% .50%
FIRST NEXT OVER
$750 MILLION $750 MILLION $1.5 BILLION
---------------- ---------------- ----------------
Equity Index Portfolio .................................... .35% .30% .25%
FIRST NEXT OVER
$500 MILLION $1 BILLION $1.5 BILLION
---------------- ---------------- ----------------
International Portfolio ................................... .90% .85% .80%
</TABLE>
3. Investment Transactions
Investment security transactions, excluding short-term debt securities,
for the Intermediate Government Securities, Quality Bond, High Yield, Growth
and Income, Equity Index, Common Stock, Global, Aggressive Stock,
Conservative Investors, Balanced and Growth Investors Portfolios for the year
ended December 31, 1995 and for the International Portfolio for the period
from April 3, 1995 (commencement of operations) through December 31, 1995,
were as follows:
<TABLE>
<CAPTION>
INTER-
MEDIATE
GOVERNMENT GROWTH AND
SECURITIES QUALITY BOND HIGH YIELD INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
COST OF PURCHASES:
Stocks and long-term corporate debt
securities ........................... $ -- $145,468,402 $349,218,590 $74,232,273
U.S. Government securities ............ 154,192,900 418,925,017 -- --
NET PROCEEDS OF SALES AND REDEMPTIONS:
Stocks and long-term corporate debt
securities ........................... -- 112,473,992 314,920,743 30,977,163
U.S. Government securities ............ 122,356,378 398,895,012 -- --
</TABLE>
<TABLE>
<CAPTION>
EQUITY INDEX COMMON STOCK GLOBAL INTERNATIONAL
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
COST OF PURCHASES:
Stocks and long-term corporate debt
securities ........................... $106,032,562 $2,806,308,707 $471,497,571 $21,099,670
U.S. Government securities ............ -- -- -- --
NET PROCEEDS OF SALES AND REDEMPTIONS:
Stocks and long-term corporate debt
securities ........................... 7,753,855 2,516,145,081 308,510,791 4,258,544
U.S. Government securities ............ -- -- -- --
</TABLE>
57
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
<TABLE>
<CAPTION>
AGGRESSIVE CONSERVATIVE GROWTH
STOCK INVESTORS BALANCED INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
COST OF PURCHASES:
Stocks and long-term corporate debt
securities ........................... $2,872,849,009 $148,743,299 $1,434,884,249 $437,048,382
U.S. Government securities ............ -- 461,237,646 1,084,635,596 520,328,525
NET PROCEEDS OF SALES AND REDEMPTIONS:
Stocks and long-term corporate debt
securities ........................... 2,669,746,113 122,077,033 1,357,040,743 318,090,192
U.S. Government securities ............ -- 387,824,935 871,984,286 303,579,157
</TABLE>
No activity is shown for the Money Market Portfolio since it trades
exclusively in short-term debt securities.
Transactions in options written for the year ended December 31, 1995 are
summarized as follows:
<TABLE>
<CAPTION>
COMMON STOCK
PORTFOLIO
---------------------------
NUMBER OF PREMIUMS
CONTRACTS RECEIVED
----------- --------------
<S> <C> <C>
Options outstanding--January 1, 1995 ............... 11,000 $ 4,512,479
Options written .................................... 372,200 129,355,157
Options terminated in closing purchase transactions (129,200) (44,663,530)
Options expired .................................... (79,900) (23,860,121)
Options exercised .................................. (101,700) (33,654,453)
----------- --------------
Options outstanding -- December 31, 1995 .......... 72,400 $ 31,689,532
=========== ==============
</TABLE>
The Portfolios (except for the Money Market, Intermediate Government
Securities and Equity Index Portfolios) may enter into forward currency
contracts in order to hedge their exposure to changes in foreign currency
exchange rates on its foreign securities holdings. A forward contract is a
commitment to purchase or sell a foreign currency at a future date at a
negotiated forward rate. The gain or loss arising from the difference between
the original contracts and the closing of such contracts is included in
realized gains or losses from foreign currency transactions. At December 31,
1995, the Quality Bond, Global, International and Growth Investors Portfolios
had outstanding forward currency contracts to buy/sell foreign currencies as
follows:
<TABLE>
<CAPTION>
CONTRACT COST ON U.S. $ UNREALIZED
AMOUNT ORIGINATION CURRENT APPRECIATION/
QUALITY BOND PORTFOLIO: (000'S) DATE VALUE (DEPRECIATION)
- ---------------------------------- ---------- ------------- ------------ ---------------
<S> <C> <C> <C> <C>
FOREIGN CURRENCY SALE CONTRACTS
Deutsche Marks, expiring 01/08/96 8,561 $6,203,531 $6,086,607 $116,924
Spanish Pesetas, expiring 01/08/96 800,056 6,400,394 6,492,384 (91,990)
---------------
$ 24,934
===============
</TABLE>
58
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
<TABLE>
<CAPTION>
CONTRACT COST ON U.S. $ UNREALIZED
AMOUNT ORIGINATION CURRENT APPRECIATION/
GLOBAL PORTFOLIO: (000'S) DATE VALUE (DEPRECIATION)
- ---------------------------------------- ----------- ------------- ------------ ---------------
<S> <C> <C> <C> <C>
FOREIGN CURRENCY BUY CONTRACTS
Japanese Yen, expiring 01/18/96-03/13/96 753,065 $ 7,582,760 $ 7,438,184 $(144,576)
FOREIGN CURRENCY SALE CONTRACTS
Deutsche Marks, expiring 01/18/96 ...... 10,025 6,546,793 6,768,498 (221,705)
Japanese Yen, expiring 01/18/96-03/13/96 1,425,065 14,834,482 14,318,282 516,200
Netherland Guilders, expiring 01/18/96 . 29,464 16,569,996 17,151,929 (581,933)
---------------
$(432,014)
===============
</TABLE>
<TABLE>
<CAPTION>
CONTRACT COST ON U.S. $ UNREALIZED
AMOUNT ORIGINATION CURRENT APPRECIATION/
INTERNATIONAL PORTFOLIO: (000'S) DATE VALUE (DEPRECIATION)
- ---------------------------------- ---------- ------------- --------- ---------------
<S> <C> <C> <C> <C>
FOREIGN CURRENCY BUY CONTRACTS
Deutsche Marks, expiring 01/02/96 7 $ 4,927 $ 4,938 $ 11
Japanese Yen, expiring 03/13/96 .. 29,200 297,824 290,316 (7,508)
Spanish Pesetas, expiring 01/02/96 1,970 16,201 16,207 6
FOREIGN CURRENCY SALE CONTRACTS
Deutsche Marks, expiring 01/18/96 53 34,332 35,508 (1,176)
Japanese Yen, expiring 03/13/96 .. 68,400 717,938 690,204 27,734
Netherland Guilders, expiring
01/18/96-04/18/96 ................ 1,156 721,696 720,802 894
---------------
$19,961
===============
</TABLE>
<TABLE>
<CAPTION>
CONTRACT COST ON U.S. $ UNREALIZED
AMOUNT ORIGINATION CURRENT APPRECIATION/
GROWTH INVESTORS PORTFOLIO: (000'S) DATE VALUE (DEPRECIATION)
- --------------------------------- ---------- ------------- ----------- ---------------
<S> <C> <C> <C> <C>
FOREIGN CURRENCY BUY CONTRACTS
British Pounds, expiring 01/02/96 46 $ 71,711 $ 71,897 $ 186
Japanese Yen, expiring 03/13/96 . 160,000 1,645,911 1,597,774 (48,137)
FOREIGN CURRENCY SALE CONTRACTS
Deutsche Marks, expiring 01/18/96 581 379,142 392,130 (12,988)
Japanese Yen, expiring 03/13/96 . 270,000 2,832,888 2,723,950 108,938
Netherland Guilders,
expiring 01/18/96 ............... 5,054 2,943,441 3,046,111 (102,670)
---------------
$ (54,671)
===============
</TABLE>
As of December 31, 1995, the gross unrealized appreciation (depreciation)
of investments based on the aggregate cost of investments for Federal income
tax purposes was as follows:
<TABLE>
<CAPTION>
INTER-
MEDIATE
GOVERNMENT GROWTH AND
MONEY MARKET SECURITIES QUALITY BOND HIGH YIELD INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- ------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Aggregate gross unrealized appreciation $ 165,407 $ 1,641,323 $ 3,827,546 $ 3,680,822 $11,613,177
Aggregate gross unrealized depreciation -- (22,848) -- (1,660,205) (528,849)
-------------- ------------- -------------- -------------- -------------
Net unrealized appreciation ............. $ 165,407 $ 1,618,475 $ 3,827,546 $ 2,020,617 $11,084,328
============== ============= ============== ============== =============
Federal income tax cost of investments . $382,846,598 $74,752,462 $149,999,118 $110,862,276 $86,451,920
============== ============= ============== ============== =============
</TABLE>
59
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
<TABLE>
<CAPTION>
EQUITY INDEX COMMON STOCK GLOBAL INTERNATIONAL
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C>
Aggregate gross unrealized appreciation $ 22,610,639 $1,084,158,519 $ 99,390,461 $ 1,200,611
Aggregate gross unrealized depreciation (1,705,375) (108,346,750) (25,331,986) (364,080)
-------------- -------------- -------------- ---------------
Net unrealized appreciation ............. $ 20,905,264 $ 975,811,769 $ 74,058,475 $ 836,531
-------------- -------------- -------------- ---------------
Federal income tax cost of investments . $142,303,360 $3,900,059,276 $604,348,540 $28,340,152
============== ============== ============== ===============
</TABLE>
<TABLE>
<CAPTION>
AGGRESSIVE CONSERVATIVE GROWTH
STOCK INVESTORS BALANCED INVESTORS
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Aggregate gross unrealized appreciation $ 564,697,749 $ 14,448,758 $ 141,484,133 $123,642,423
Aggregate gross unrealized depreciation (56,646,411) (20,280) (21,819,284) (5,622,923)
-------------- -------------- -------------- --------------
Net unrealized appreciation ............. $ 508,051,338 $ 14,428,478 $ 119,664,849 $118,019,500
============== ============== ============== ==============
Federal income tax cost of investments . $2,167,270,805 $233,830,095 $1,384,846,688 $760,844,509
============== ============== ============== ==============
</TABLE>
The Growth and Income Portfolio had net capital loss carryforwards of
$474,588 (of which $2,753 expires in the year 2001, $281,737 expires in the
year 2002 and $190,098 expires in the year 2003), the High Yield Portfolio
had net capital loss carryforwards of $1,100,531 (of which $1,059,564 expires
in the year 2002 and $40,967 expires in the year 2003), the Intermediate
Government Securities and Quality Bond Portfolios had net capital loss
carryforwards of $9,349,227 and $5,388,947, respectively, which all expire in
the year 2002. To the extent the above losses are used to offset future
capital gains, it is probable that the gains so offset will not be
distributed to shareholders.
4. Capital Share Transactions
At December 31, 1995, there was an unlimited number of shares of
beneficial interest (Shares), without par value, available for issuance by
the Board of Trustees. Shares are divided into thirteen classes, one class
for each Portfolio.
60
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Continued)
December 31, 1995
Transactions in Shares were as follows:
<TABLE>
<CAPTION>
INTERMEDIATE
GOVERNMENT
MONEY MARKET SECURITIES
PORTFOLIO PORTFOLIO
---------- ---------
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
-------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
Shares sold ..... 38,608,910 34,864,688 3,178,905 3,505,801
Shares issued in
connection with
the
substitution of
the Short-Term
World Income
Portfolio ...... -- -- -- 254,893
Shares issued in
reinvestment
of dividends
and
distributions . 1,793,866 1,126,391 391,277 764,978
-------------- -------------- ------------- --------------
Total shares
issued ......... 40,402,776 35,991,079 3,570,182 4,525,672
Shares redeemed (34,441,594) (28,439,024) (1,464,671) (14,777,456)
-------------- -------------- ------------- --------------
Net increase
(decrease) ..... 5,961,182 7,552,055 2,105,511 (10,251,784)
============== ============== ============= ==============
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
QUALITY BOND HIGH YIELD
PORTFOLIO PORTFOLIO
-------------------------- ----------------------------
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
------------- ----------- ------------- -------------
<S> <C> <C> <C> <C>
Shares sold ..... 2,039,780 3,600,969 4,920,577 3,096,529
Shares issued in
connection with
the
substitution of
the Short-Term
World Income
Portfolio ...... -- -- -- --
Shares issued in
reinvestment
of dividends
and
distributions . 941,017 931,997 1,087,864 687,436
------------- ----------- ------------- -------------
Total shares
issued ......... 2,980,797 4,532,966 6,008,441 3,783,965
Shares redeemed (1,231,693) (572,547) (2,047,031) (2,156,031)
------------- ----------- ------------- -------------
Net increase
(decrease) ..... 1,749,104 3,960,419 3,961,410 1,627,934
============= =========== ============= =============
</TABLE>
<TABLE>
<CAPTION>
GROWTH AND
INCOME EQUITY INDEX
PORTFOLIO PORTFOLIO
-------------------- -----------------------------
FOR THE PERIOD
FROM
YEAR ENDED YEAR ENDED MARCH 1, 1994*
DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
1995 1994 1995 1994
--------- --------- ------------ --------------
<S> <C> <C> <C> <C>
Shares sold ..... 5,330,789 3,211,395 12,811,615 3,972,324
Shares issued in
reinvestment
of dividends
and
distributions . 173,344 43,243 243,074 81,699
--------- --------- ------------ ---------------
Total shares
issued ......... 5,504,133 3,254,638 13,054,689 4,054,023
Shares redeemed (375,025) (149,828) (4,148,263) (330,143)
--------- --------- ------------ ---------------
Net increase ... 5,129,108 3,104,810 8,906,426 3,723,880
========= ========= ============ ===============
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
COMMON STOCK GLOBAL INTERNATIONAL
PORTFOLIO PORTFOLIO PORTFOLIO
------------------------- ------------------------ -----------------
FOR THE PERIOD
YEAR ENDED YEAR ENDED FROM
DECEMBER 31, DECEMBER 31, APRIL 3, 1995* TO
1995 1994 1995 1994 DECEMBER 31, 1995
------------ ----------- ----------- ----------- ------------------
<S> <C> <C> <C> <C> <C>
Shares sold ..... 32,314,046 35,758,326 15,621,046 21,053,323 2,781,575
Shares issued in
reinvestment
of dividends
and
distributions . 20,247,043 17,645,138 1,875,847 898,514 46,457
------------ ----------- ----------- ----------- -----------------
Total shares
issued ......... 52,561,089 53,403,464 17,496,893 21,951,837 2,828,032
Shares redeemed (15,886,663) (7,202,598) (4,317,611) (1,911,754) (190,166)
------------ ----------- ----------- ----------- -----------------
Net increase ... 36,674,426 46,200,866 13,179,282 20,040,083 2,637,866
============ =========== =========== =========== =================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONSERVATIVE
AGGRESSIVE STOCK INVESTORS
PORTFOLIO PORTFOLIO
------------------------------ ------------------------
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
-------------- -------------- ----------- -----------
<S> <C> <C> <C> <C>
Shares sold ........ 24,290,758 23,071,977 4,574,632 6,795,540
Shares issued in
reinvestment
of dividends and
distributions ..... 8,689,767 69,084 1,178,017 760,857
-------------- -------------- ----------- -----------
Total shares issued 32,980,525 23,141,061 5,752,649 7,556,397
Shares redeemed ... (17,101,621) (12,173,721) (983,364) (730,909)
-------------- -------------- ----------- -----------
Net increase ....... 15,878,904 10,967,340 4,769,285 6,825,488
============== ============== =========== ===========
</TABLE>
(RESTUBBED TABLE CONTINUED FROM ABOVE)
<TABLE>
<CAPTION>
GROWTH
BALANCED INVESTORS
PORTFOLIO PORTFOLIO
---------------------------- ---------------------------
YEAR ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
1995 1994 1995 1994
------------- ------------- ------------- ------------
<S> <C> <C> <C> <C>
Shares sold ........ 3,451,513 10,355,446 16,117,087 15,839,742
Shares issued in
reinvestment
of dividends and
distributions ..... 5,393,327 2,742,085 2,104,190 886,613
------------- ------------- ------------- ------------
Total shares issued 8,844,840 13,097,531 18,221,277 16,726,355
Shares redeemed ... (7,393,399) (5,497,701) (1,144,340) (960,533)
------------- ------------- ------------- ------------
Net increase ....... 1,451,441 7,599,830 17,076,937 15,765,822
============= ============= ============= ============
</TABLE>
* Commencement of operations.
61
<PAGE>
THE HUDSON RIVER TRUST
NOTES TO FINANCIAL STATEMENTS--(Concluded)
December 31, 1995
5. Transactions with Affiliated Companies
An affiliated company is a company in which the fund has ownership of at
least 5% of the voting securities. Investments in companies which are
affiliates as of December 31, 1995 are summarized as follows:
<TABLE>
<CAPTION>
PORTFOLIO AFFILIATES COST MARKET VALUE
- ------------ -------------------------------------- -------------- -------------
<S> <C> <C> <C>
Common CBL & Associates Properties ........... $ 21,426,856 $ 23,864,100
Stock Chris Craft Industries, Inc. (Class B) 13,002,923 52,926,452
Essex Property Trust, Inc. ............ 7,083,100 7,026,250
Regency Realty Corp. .................. 14,600,607 13,260,075
-------------- -------------
$ 56,113,486 $ 97,076,877
============== =============
Global Nelvana Limited ....................... $ 1,348,650 $ 1,889,495
============== =============
Aggressive Healthwise of America, Inc. ........... $ 21,053,273 $ 36,899,265
Stock Nine West Group, Inc. ................. 71,622,521 87,810,000
Playboy Enterprises, Inc. (Class B) .. 7,372,639 7,798,800
Sun Healthcare Group, Inc. ............ 60,385,694 34,501,950
Telephone & Data Systems, Inc. ....... 115,178,270 117,753,450
Xtra Corp. ............................ 56,821,377 50,417,750
-------------- -------------
$332,433,774 $335,181,215
============== =============
</TABLE>
62
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS
December 31, 1995
SELECTED DATA FOR A PORTFOLIO SHARE OUTSTANDING THROUGHOUT EACH PERIOD(C)
MONEY MARKET PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------------------------
1995 1994 1993* 1992 1991
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) $10.14 $10.12 $10.11 $10.13 $10.17
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................... 0.57 0.41 0.30 0.37 0.61
Net realized and unrealized loss on
investments ............................ -- -- -- (0.01) --
---------- ---------- ---------- ---------- ----------
Total from investment operations ....... 0.57 0.41 0.30 0.36 0.61
---------- ---------- ---------- ---------- ----------
LESS DIVIDENDS:
Dividends from net investment income ... (0.55) (0.39) (0.29) (0.38) (0.65)
---------- ---------- ---------- ---------- ----------
Total dividends ......................... (0.55) (0.39) (0.29) (0.38) (0.65)
---------- ---------- ---------- ---------- ----------
Net asset value, end of period ........... $10.16 $10.14 $10.12 $10.11 $10.13
========== ========== ========== ========== ==========
Total return (d) ......................... 5.74% 4.02% 3.00% 3.57% 6.20%
========== ========== ========== ========== ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ....... $386,691 $325,391 $248,460 $268,584 $302,395
Ratio of expenses to average net assets . 0.44% 0.42% 0.42% 0.43% 0.43%
Ratio of net investment income to average
net assets .............................. 5.53% 4.01% 2.91% 3.63% 5.96%
</TABLE>
INTERMEDIATE GOVERNMENT SECURITIES PORTFOLIO(E):
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, APRIL 1, 1991 TO
----------------------------------------------- DECEMBER 31,
1995 1994 1993* 1992 1991
----------- --------- ---------- ---------- ------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) .............. $ 8.87 $10.08 $10.53 $10.73 $10.00
----------- --------- ---------- ---------- ----------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................................ 0.58 0.65 0.59 0.60 0.52
Net realized and unrealized gain (loss) on
investments .......................................... 0.57 (1.08) 0.51 (0.02) 0.66
----------- --------- ---------- ---------- ----------------
Total from investment operations ..................... 1.15 (0.43) 1.10 0.58 1.18
----------- --------- ---------- ---------- ----------------
LESS DISTRIBUTIONS:
Dividends from net investment income ................. (0.55) (0.78) (0.68) (0.60) (0.34)
Distributions from realized gains .................... -- -- (0.87) (0.18) (0.11)
----------- --------- ---------- ---------- ----------------
Total dividends and distributions .................... (0.55) (0.78) (1.55) (0.78) (0.45)
----------- --------- ---------- ---------- ----------------
Net asset value, end of period ........................ $ 9.47 $ 8.87 $10.08 $10.53 $10.73
=========== ========= ========== ========== ================
Total return (d) ...................................... 13.33% (4.37)% 10.58% 5.53% 12.10%
=========== ========= ========== ========== ================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ..................... $71,780 $48,518 $158,511 $293,587 $241,290
Ratio of expenses to average net assets ............... 0.57% 0.56% 0.53% 0.52% 0.43%
Ratio of net investment income to average net assets . 6.15% 6.75% 5.43% 5.63% 4.88%
Portfolio turnover rate ............................... 255% 133% 254% 316% 174%
</TABLE>
63
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS -- (Continued)
December 31, 1995
QUALITY BOND PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, OCTOBER 1, 1993
---------------------- TO DECEMBER 31,
1995 1994 1993
---------- ---------- -----------------
<S> <C> <C> <C>
Net asset value, beginning of period (a) .............. $8.72 $ 9.82 $10.00
---------- ---------- -----------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................................ 0.57 0.66 0.11
Net realized and unrealized gain (loss) on investments
and foreign currency transactions ................... 0.88 (1.16) (0.16)
---------- ---------- -----------------
Total from investment operations ..................... 1.45 (0.50) (0.05)
---------- ---------- -----------------
LESS DISTRIBUTIONS:
Dividends from net investment income ................. (0.56) (0.55) (0.12)
Distributions in excess of realized gains ............ -- -- (0.01)
Tax return of capital distributions .................. -- (0.05) --
---------- ---------- -----------------
Total dividends and distributions .................... (0.56) (0.60) (0.13)
---------- ---------- -----------------
Net asset value, end of period ........................ $9.61 $ 8.72 $ 9.82
========== ========== =================
Total return (d) ...................................... 17.02% (5.10)% (0.51)%
========== ========== =================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ..................... $157,443 $127,575 $104,832
Ratio of expenses to average net assets ............... 0.59% 0.59% 0.69%(b)
Ratio of net investment income to average net assets .. 6.13% 7.17% 4.62%(b)
Portfolio turnover rate ............................... 411% 222% 77%
</TABLE>
HIGH YIELD PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------------
1995 1994 1993* 1992 1991
------------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) .... $ 8.91 $10.08 $ 9.15 $ 8.96 $ 7.97
------------- --------- --------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ....................... 0.98 0.89 0.94 0.89 0.89
Net realized and unrealized gain (loss) on
investments ................................ 0.73 (1.17) 1.10 0.19 0.99
------------- --------- --------- --------- ---------
Total from investment operations ............ 1.71 (0.28) 2.04 1.08 1.88
------------- --------- --------- --------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income ....... (0.94) (0.88) (0.92) (0.89) (0.89)
Dividends in excess of net investment income (0.04) (0.01) -- -- --
Distributions from realized gains ........... -- -- (0.19) -- --
------------- --------- --------- --------- ---------
Total dividends and distributions ........... (0.98) (0.89) (1.11) (0.89) (0.89)
------------- --------- --------- --------- ---------
Net asset value, end of period ............... $ 9.64 $8.91 $10.08 $ 9.15 $ 8.96
============= ========= ========= ========= =========
Total return (d) ............................. 19.92% (2.79)% 23.15% 12.31% 24.46%
============= ========= ========= ========= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ............ $118,129 $73,895 $67,169 $47,687 $45,066
Ratio of expenses to average net assets ..... 0.60% 0.61% 0.63% 0.60% 0.61%
Ratio of net investment income to average net
assets ...................................... 10.34% 9.23% 9.52% 9.58% 10.31%
Portfolio turnover rate ...................... 350% 248% 280% 177% 187%
</TABLE>
64
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS -- (Continued)
December 31, 1995
GROWTH AND INCOME PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, OCTOBER 1, 1993
---------------------- TO DECEMBER 31,
1995 1994 1993
---------- ---------- -----------------
<S> <C> <C> <C>
Net asset value, beginning of period (a) ............... $ 9.70 $ 9.95 $10.00
--------- --------- -----------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................................. 0.33 0.31 0.03
Net realized and unrealized gain (loss) on investments 1.97 (0.36) (0.06)
--------- --------- -----------------
Total from investment operations ...................... 2.30 (0.05) (0.03)
--------- --------- -----------------
LESS DISTRIBUTIONS:
Dividends from net investment income .................. (0.30) (0.20) (0.02)
Dividends in excess of net investment income ......... -- -- (0.00)
Tax return of capital distributions ................... -- -- (0.00)
--------- --------- -----------------
Total dividends and distributions ..................... (0.30) (0.20) (0.02)
--------- --------- -----------------
Net asset value, end of period ......................... $11.70 $ 9.70 $ 9.95
========= ========= =================
Total return (d) ....................................... 24.07% (0.58)% (0.25)%
========= ========= =================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ...................... $98,053 $31,522 $1,456
Ratio of expenses to average net assets ................ 0.60% 0.78% 2.70%(b)
Ratio of net investment income to average net asset ... 3.11% 3.13% 1.12%(b)
Portfolio turnover rate ................................ 65% 52% 48%
</TABLE>
EQUITY INDEX PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED MARCH 1, 1994 TO
DECEMBER 31, 1995 DECEMBER 31, 1994
----------------- -----------------
<S> <C> <C>
Net asset value, beginning of period (a) ............... $ 9.87 $10.00
----------------- -----------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................................ 0.26 0.20
Net realized and unrealized gain (loss) on investments 3.32 (0.09)
----------------- -----------------
Total from investment operations ..................... 3.58 0.11
----------------- -----------------
LESS DISTRIBUTIONS:
Dividends from net investment income ................. (0.22) (0.20)
Distributions of realized gains ...................... (0.09) (0.03)
Distributions in excess of realized gains ............ (0.01) (0.01)
----------------- -----------------
Total dividends and distributions .................... (0.32) (0.24)
----------------- -----------------
Net asset value, end of period ......................... $13.13 $ 9.87
================= =================
Total return (d) ....................................... 36.48% 1.08%
================= =================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ...................... $165,785 $36,748
Ratio of expenses to average net assets ................ 0.48% 0.49%(b)
Ratio of net investment income to average net assets .. 2.16% 2.42%(b)
Portfolio turnover rate ................................ 9% 7%
</TABLE>
65
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS--(Continued)
December 31, 1995
COMMON STOCK PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------------
1995 1994 1993* 1992 1991
--------------- --------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of
period (a) ..................... $ 13.36 $ 14.65 $ 13.49 $ 14.18 $ 11.22
--------------- --------------- --------------- --------------- ---------------
INCOME FROM INVESTMENT
OPERATIONS:
Net investment income ......... 0.20 0.20 0.23 0.24 0.32
Net realized and unrealized
gain (loss) on
investments and foreign
currency
transactions ................. 4.12 (0.51) 3.10 0.20 3.91
--------------- --------------- --------------- --------------- ---------------
Total from investment
operations ................... 4.32 (0.31) 3.33 0.44 4.23
--------------- --------------- --------------- --------------- ---------------
LESS DISTRIBUTIONS:
Dividends from net investment
income ....................... (0.20) (0.19) (0.23) (0.24) (0.29)
Dividends in excess of net
investment
income ....................... (0.02) (0.01) (0.00) -- --
Distributions from realized
gains ........................ (0.95) (0.77) (1.94) (0.89) (0.98)
Distributions in excess of
realized gains ............... (0.03) -- -- -- --
Tax return of capital
distributions ................ -- (0.01) -- -- --
--------------- --------------- --------------- --------------- ---------------
Total dividends and
distributions ................ (1.20) (0.98) (2.17) (1.13) (1.27)
--------------- --------------- --------------- --------------- ---------------
Net asset value, end of period .. $ 16.48 $ 13.36 $ 14.65 $ 13.49 $ 14.18
=============== =============== =============== =============== ===============
Total return (d) ................ 32.45% (2.14)% 24.84% 3.22% 37.90%
=============== =============== =============== =============== ===============
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) $4,879,677 $3,466,245 $3,125,128 $2,307,292 $2,126,402
Ratio of expenses to average net
assets ........................ 0.38% 0.38% 0.38% 0.38% 0.40%
Ratio of net investment income to
average net assets ............ 1.27% 1.40% 1.55% 1.73% 2.32%
Portfolio turnover rate ......... 61% 52% 82% 71% 90%
</TABLE>
66
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS -- (Continued)
December 31, 1995
GLOBAL PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------
1995 1994 1993* 1992 1991
------------ ------------ ------------ --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) . $ 13.87 $ 13.62 $ 11.41 $ 11.64 $ 9.76
------------ ------------ ------------ --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................... 0.26 0.20 0.08 0.14 0.22
Net realized and unrealized gain (loss)
on investments and foreign currency
transactions ............................ 2.32 0.52 3.58 (0.20) 2.74
------------ ------------ ------------ --------- ---------
Total from investment operations ........ 2.58 0.72 3.66 (0.06) 2.96
------------ ------------ ------------ --------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income .... (0.25) (0.17) (0.15) (0.11) (0.23)
Distributions from realized gains ....... (0.42) (0.28) (1.30) (0.06) (0.85)
Distributions in excess of realized gains (0.03) (0.00) (0.00) -- --
Tax return of capital distributions ..... (0.01) (0.02) -- -- --
------------ ------------ ------------ --------- ---------
Total dividends and distributions ....... (0.71) (0.47) (1.45) (0.17) (1.08)
------------ ------------ ------------ --------- ---------
Net asset value, end of period ............ $ 15.74 $ 13.87 $ 13.62 $ 11.41 $ 11.64
============ ============ ============ ========= =========
Total return (d) .......................... 18.81% 5.23% 32.09% (0.50)% 30.54%
============ ============ ============ ========= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ........ $686,140 $421,698 $141,257 $49,171 $39,487
Ratio of expenses to average net assets .. 0.61% 0.69% 0.84% 0.70% 0.75%
Ratio of net investment income to average
net assets ............................... 1.76% 1.41% 0.62% 1.20% 1.94%
Portfolio turnover rate ................... 67% 71% 150% 216% 267%
</TABLE>
INTERNATIONAL PORTFOLIO:
<TABLE>
<CAPTION>
APRIL 3, 1995 TO
DECEMBER 31, 1995
-----------------
<S> <C>
Net asset value, beginning of period (a) ............. $ 10.00
-----------------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .............................. 0.14
Net realized and unrealized gain on investments .... 0.98
-----------------
Total from investment operations ................... 1.12
-----------------
LESS DISTRIBUTIONS:
Dividends from net investment income ............... (0.07)
Dividends in excess of net investment income ....... (0.13)
Distributions of realized gains .................... (0.05)
-----------------
Total dividends and distributions .................. (0.25)
-----------------
Net asset value, end of period ....................... $ 10.87
=================
Total return (d) ..................................... 11.29%
=================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) .................... $28,684
Ratio of expenses to average net assets .............. 1.03%(b)
Ratio of net investment income to average net assets 1.71%(b)
Portfolio turnover rate .............................. 56%
</TABLE>
67
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS -- (Continued)
December 31, 1995
AGGRESSIVE STOCK PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------------------------------------------
1995 1994 1993* 1992 1991
-------------- -------------- --------------- -------------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period
(a) ................................... $ 30.63 $31.89 $ 29.81 $ 33.82 $ 19.37
-------------- -------------- --------------- -------------- -----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................. 0.10 0.04 0.09 0.17 0.12
Net realized and unrealized gain
(loss) on investments ................ 9.54 (1.26) 4.91 (1.25) 16.68
-------------- -------------- --------------- -------------- -----------
Total from investment operations ..... 9.64 (1.22) 5.00 (1.08) 16.80
-------------- -------------- --------------- -------------- -----------
LESS DISTRIBUTIONS:
Dividends from net investment income (0.10) (0.04) (0.09) (0.18) (0.10)
Distributions from realized gains .... (4.49) -- (2.75) (2.75) (2.25)
Distributions in excess of realized
gains ................................ -- -- (0.07) -- --
Tax return of capital distributions .. -- (0.00) (0.01) -- --
-------------- -------------- --------------- -------------- -----------
Total dividends and distributions. ... (4.59) (0.04) (2.92) (2.93) (2.35)
-------------- -------------- --------------- -------------- -----------
Net asset value, end of period ......... $ 35.68 $ 30.63 $ 31.89 $ 29.81 $ 33.82
============== ============== =============== ============== ===========
Total return (d) ....................... 31.63% (3.81)% 16.77% (3.16)% 86.87%
============== ============== =============== ============== ===========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ..... $2,700,515 $1,832,164 $1,557,332 $1,210,576 $959,257
Ratio of expenses to average net assets 0.49% 0.49% 0.49% 0.50% 0.51%
Ratio of net investment income to
average net assets .................... 0.28% 0.12% 0.28% 0.57% 0.40%
Portfolio turnover rate ................ 127% 92% 89% 68% 117%
</TABLE>
CONSERVATIVE INVESTORS PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------
1995 1994 1993* 1992 1991
----------- ----------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period (a) $ 10.15 $ 11.12 $ 10.94 $ 11.29 $ 10.23
----------- ----------- ----------- --------- ---------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income .................. 0.60 0.55 0.52 0.64 0.69
Net realized and unrealized gain
(loss) on investments ................. 1.43 (1.00) 0.65 (0.01) 1.28
----------- ----------- ----------- --------- ---------
Total from investment operations ...... 2.03 (0.45) 1.17 0.63 1.97
----------- ----------- ----------- --------- ---------
LESS DISTRIBUTIONS:
Dividends from net investment income . (0.59) (0.52) (0.50) (0.62) (0.66)
Dividends in excess of net investment
income ................................. -- -- (0.00) -- --
Distributions from realized gains ..... (0.07) -- (0.49) (0.36) (0.25)
----------- ----------- ----------- --------- ---------
Total dividends and distributions ..... (0.66) (0.52) (0.99) (0.98) (0.91)
----------- ----------- ----------- --------- ---------
Net asset value, end of period .......... $ 11.52 $ 10.15 $ 11.12 $ 10.94 $ 11.29
=========== =========== =========== ========= =========
Total return (d) ........................ 20.40% (4.10)% 10.76% 5.64 % 19.80%
=========== =========== =========== ========= =========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ...... $252,101 $173,691 $114,418 $70,675 $50,279
Ratio of expenses to average net assets 0.59% 0.59% 0.60% 0.61% 0.64%
Ratio of net investment income to
average net assets ..................... 5.48% 5.22% 4.49% 5.77% 6.45%
Portfolio turnover rate ................. 287% 228% 178% 136% 171%
</TABLE>
68
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS -- (Continued)
December 31, 1995
BALANCED PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------------------------------
1995 1994 1993* 1992 1991
-------------- ------------- ------------- ------------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period
(a) ................................... $14.87 $16.67 $16.19 $18.48 $14.40
-------------- ------------- ------------- ------------- -----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................. 0.54 0.45 0.50 0.56 0.60
Net realized and unrealized gain
(loss) on investments ................ 2.36 (1.78) 1.46 (1.11) 5.23
-------------- ------------- ------------- ------------- -----------
Total from investment operations ..... 2.90 (1.33) 1.96 (0.55) 5.83
-------------- ------------- ------------- ------------- -----------
LESS DISTRIBUTIONS:
Dividends from net investment income (0.54) (0.44) (0.50) (0.55) (0.55)
Dividends in excess of net investment
income ................................ -- (0.03) -- -- --
Distributions from realized gains .... (0.47) -- (0.95) (1.19) (1.20)
Distributions in excess of realized
gains ................................ -- -- (0.03) -- --
Tax return of capital distributions .. -- (0.00) -- -- --
-------------- ------------- ------------- ------------- -----------
Total dividends and distributions .... (1.01) (0.47) (1.48) (1.74) (1.75)
-------------- ------------- ------------- ------------- -----------
Net asset value, end of period ......... $16.76 $14.87 $16.67 $16.19 $18.48
============== ============= ============= ============= ===========
Total return (d) ....................... 19.75% (8.02)% 12.28% (2.85)% 41.25%
============== ============= ============= ============= ===========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ..... $1,523,142 $1,329,820 $1,364,640 $1,076,670 $964,262
Ratio of expenses to average net assets 0.40% 0.39% 0.39% 0.40% 0.41%
Ratio of net investment income to
average net assets .................... 3.33% 2.87% 2.99% 3.30% 3.60%
Portfolio turnover rate ................ 186% 115% 99% 91% 159%
</TABLE>
GROWTH INVESTORS PORTFOLIO:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------------------------
1995 1994 1993* 1992 1991
------------ ------------ ------------ ------------ ----------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period
(a) ................................... $ 14.66 $ 15.61 $ 14.69 $ 15.17 $ 11.03
------------ ------------ ------------ ------------ ----------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income ................ 0.57 0.50 0.43 0.44 0.41
Net realized and unrealized gain
(loss) on investments and foreign
currency transactions .............. 3.24 (0.98) 1.79 0.28 4.93
------------ ------------ ------------ ------------ ----------
Total from investment operations ..... 3.81 (0.48) 2.22 0.72 5.34
------------ ------------ ------------ ------------ ----------
LESS DISTRIBUTIONS:
Dividends from net investment income . (0.54) (0.46) (0.42) (0.41) (0.37)
Dividends in excess of net investment
income ............................. (0.01) (0.01) -- -- --
Distributions from realized gains .... (0.24) -- (0.88) (0.79) (0.83)
------------ ------------ ------------ ------------ ----------
Total dividends and distributions .... (0.79) (0.47) (1.30) (1.20) (1.20)
------------ ------------ ------------ ------------ ----------
Net asset value, end of period ......... $ 17.68 $ 14.66 $ 15.61 $ 14.69 $ 15.17
============ ============ ============ ============ ==========
Total return (d) ....................... 26.37% (3.15)% 15.26% 4.85% 48.83%
============ ============ ============ ============ ==========
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's) ..... $896,134 $492,478 $278,467 $148,650 $84,338
Ratio of expenses to average net assets 0.56% 0.59% 0.62% 0.60% 0.66%
Ratio of net investment income to
average net assets ................... 3.43% 3.32% 2.71% 3.00% 3.03%
Portfolio turnover rate ................ 107% 131% 118% 129% 139%
</TABLE>
69
<PAGE>
THE HUDSON RIVER TRUST
FINANCIAL HIGHLIGHTS--(Concluded)
December 31, 1995
* Prior to July 22, 1993, Equitable Capital Management Corporation
(Equitable Capital) served as the investment adviser to the Trust. On
July 22, 1993, Alliance Capital Management L.P. acquired the business
and substantialy all of the assets of Equitable Capital and became the
investment adviser to the Trust.
(a) Date as of which funds were first allocated to the Portfolios are as
follows:
Common Stock Portfolio--June 16, 1975
Money Market Portfolio--July 13, 1981
Balanced Portfolio--January 27, 1986
Aggressive Stock Portfolio--January 27, 1986
High Yield Portfolio--January 2, 1987
Global Portfolio--August 27, 1987
Conservative Investors Portfolio--October 2, 1989
Growth Investors Portfolio--October 2, 1989
Intermediate Government Securities Portfolio--April 1, 1991
Quality Bond Portfolio--October 1, 1993
Growth and Income Portfolio--October 1, 1993
Equity Index Portfolio--March 1, 1994
International Portfolio--April 3, 1995
(b) Annualized.
(c) Net investment income and capital changes per share are based upon
monthly average shares outstanding.
(d) Total return is calculated assuming an initial investment made at the
net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Total return calculated for a
period of less than one year is not annualized.
(e) On February 22, 1994, shares of the Intermediate Government Securities
Portfolio of the Trust were substituted for shares of the Trust's
Short-Term World Income Portfolio.
70
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Trustees
of The Hudson River Trust
In our opinion, the accompanying statements of assets and liabilities,
including the portfolios of investments, and the related statements of
operations and of changes in net assets and financial highlights present
fairly, in all material respects, the financial position of the Money Market
Portfolio, Intermediate Government Securities Portfolio, Quality Bond
Portfolio, High Yield Portfolio, Growth and Income Portfolio, Equity Index
Portfolio, Common Stock Portfolio, Global Portfolio, International Portfolio,
Aggressive Stock Portfolio, Conservative Investors Portfolio, Balanced
Portfolio and Growth Investors Portfolio (constituting The Hudson River
Trust, hereafter referred to as the "Trust") at December 31, 1995, the
results of each of their operations for the year or indicated period then
ended, the changes in each of their net assets and the financial highlights
for each of the periods presented, in conformity with generally accepted
accounting principles. These financial statements and financial highlights
(hereafter referred to as "financial statements") are the responsibility of
the Trust's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with generally accepted auditing standards
which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities at December 31, 1995 by
correspondence with the custodian and brokers and the application of
alternative auditing procedures where confirmations from brokers were not
received, provide a reasonable basis for the opinion expressed above. The
financial highlights for the year ended December 31, 1992 and for each of the
periods indicated prior thereto, were audited by other independent
accountants whose report dated February 10, 1993, expressed an unqualified
opinion on those financial statements.
PRICE WATERHOUSE LLP
1177 Avenue of the Americas
New York, New York 10036
February 8, 1996
71
