THE MARKMAN
MULTIFUNDS
SEMI-ANNUAL REPORT o JUNE 30, 1997 o (UNAUDITED)
April
May
June
Updates on
Conservative,
Moderate, and
Aggressive
Portfolios
Diversification: Your Airbag and Seatbelt in a Market Crash
<PAGE>
PRESIDENT'S MESSAGE
Dear Fellow Investors,
As you might imagine, folks around here are regularly asked, "What's the market
going to do?" Our standard answer seems, on the surface, to be a joke, but is
really quite serious: The market will do whatever will confound the maximum
number of investors.
<PAGE>
This was proved true once again in the second quarter. When we last wrote
to you, the markets were in the midst of a swoon that had many investors scared
and most market observers measuring the funeral shroud for the great `90s bull
market. But a funny thing happened on the way to this particular cemetery.
Literally, the day after the S&P 500 dipped into negative territory for the
year, an explosive rally began that, as I write this, still shows little sign of
abatement. And, unlike previous rallies over the past several years, this one
was broad based. Not just blue chips, but tech, small cap, and even battered
momentum funds soared.
Bottom line: It was the best quarter in funds in over six years, and the
MultiFunds' best quarter ever.
But for many investors -- including quite a few of you shareholders who have
called our offices lately -- this past quarter's "melt-up" has set off bells,
buzzers, and red warning lights of impending danger. As the Wall Street Journal
put it recently, "...fund investors happily toting up their second quarter gains
need to consider whether their portfolios -- and psyches -- are braced for ugly
scenarios such as an extended 25-40% bear market in U.S. stocks or a period of
several years of lackluster single digit gains."
- -- (WALL STREET JOURNAL, 7/3/97) The Wall Street Journal
<PAGE>
So the questions arise : What will happen to my MultiFund shares if the market
declines? What action will you take during a market correction?
How much risk am I currently assuming in my MultiFund investment?
I'll attempt to answer these questions as best I can, with the usual
caveats that no one can exactly predict the course of the markets and that, no
matter how good the analysis, it is an iffy proposition to project future
performance from historic statistics. What we can do is:
1. Revisit the conceptual foundations of our portfolios.
2. Analyze how our portfolios performed in down market conditions.
<PAGE>
First,
THE CONCEPTUAL FOUNDATION:
As you know, each of the Markman MultiFund Allocations is fully diversified and
actively managed. Our commitment to diversification ensures that each
allocation will (consistent with its risk parameters) span the range of large
and small U.S. stocks, foreign stocks, growth and value orientations, bonds, and
cash. The admitted drawback to this approach is that during periods when one
market or style is overwhelmingly strong (such as large cap U.S. growth stock in
recent years), diversification will act as a drag on upside performance.
Conversely, when the market declines, that same diversification may well
stabilize the portfolio, leading to superior relative returns.
Nice theory. But how does it play out in the real world of your portfolio?
Here are some eye-opening facts:
We went back to the beginning of this year and identified all the down days in
the market (as measured by the S&P 500). The average loss was .81%. We then did
the calculations to see what our MultiFund Allocations did on those days. The
Aggressive lost .37%, the Moderate lost .21%, and the Conservative lost only
.10%! We think that demonstrates excellent relative stability. But just adding
up and averaging isolated days may not tell the whole story. So we also looked
at how the Allocations did during the correction earlier this year. From
February 18 through April 11, the S&P 500 lost 9.7%. The Nasdaq lost 11.6%. Both
large caps and small caps were correcting. The bond market was declining
severely, and international markets were skittish in sympathy. Your portfolios,
however, held up much better. The Aggressive lost 5.5%, the Moderate 3.5%, and
the Conservative a mere 2.7%.
<PAGE>
We must be clear that this is not to be taken as any guarantee of future
performance.
We could do worse; we could do better. What is important is how these numbers
give you a real life, real-time sense of the potential volatility you are
exposed to.
So the answer to the question of what action we might take in a market decline
is somewhat addressed by the diversification moves we've already made. Of
course, the nature of any future decline is unknown, and no one can accurately
predict which areas will hold up best and which will decline the most. As events
unfold, we will likely hew to our basic diversification and actively manage
around the edges: a nip here, a tuck there. Wholesale changes are most unlikely.
Bottom line: We think all three portfolios are generating good upside
performance relative to their potential downside risk exposure. It's a tried and
true "sleep well at night" formula. We'll do the worrying. That's what you pay
us for.
/s/ Bob Markman
<PAGE>
THE MARKMAN MULTIFUNDS PERFORMANCE
Markman Aggressive Allocation Portfolio
Our major core positions in this portfolio remained fairly constant during the
quarter.
Under the lid as of 6/30/97
Often what a fund appears to be on the surface is different from what it
actually is in composition. To get a better understanding of the true nature of
the overall portfolio, we "unscrewed the tops" of each of the funds we own and
dumped the contents out on the table. Here's what the overall mix looked like.
PIE CHART:
U.S. STOCKS 69%
INTERNATIONAL STOCKS 21%
BONDS 1%
CASH 9%
...large cap technology stocks...will continue to be market leaders.
We did, however, shift some assets on the margin to reflect our increasingly
bullish view of the markets.
The defensively-oriented real estate holdings were eliminated. We also made
slight reductions in our value funds. These dollars were repositioned primarily
in PBHG Growth, Rydex Nova, and Rydex OTC.
By mid-April, the carnage in the momentum fund area had gotten so severe that we
concluded (for the first time since last summer) that the rewards finally
outweighed the risks. Gary Pilgrim, manager of the PBHG Growth Fund, is the
"dean" of aggressive momentum investors and was the logical person to tap as we
moved back into this sector. In hindsight, the timing could not have been
better.
Rydex OTC is a fund that mirrors the Nasdaq 100 Index. This index consists
primarily of larger technology companies and is weighted so that a small portion
(10 - 15 stocks) represents over 50% of the Index's movements. (In fact, Intel
and Microsoft alone represent over 30% of the Index.) This fund is a very
efficient and predictable way for us to participate in large cap technology
stocks which we believe will continue to be market leaders.
Rydex Nova is another index-oriented fund. This fund attempts to replicate 150%
of the movement of the S&P 500. Naturally, if the S&P 500 is moving up strongly,
Nova will be one of the few that is almost assured of beating the S&P 500.
So far, we've been very happy with the results created by adding these three new
"seasonings" to the mix.
<PAGE>
MARKMAN AGGRESSIVE ALLOCATION PORTFOLIO COMPARISON
<TABLE>
PUTTING IT IN PERSPECTIVE BAR CHARTS - GRAPHIC REPRESENTATION
BEHIND THE COMPARISON
<CAPTION>
Markman Aggressive S&P 500 Lipper Global
Allocation Portfolio Flexible Fund Index
<S> <C> <C> <C>
2ND QTR. 1997 11.2% 17.5% 8.1%
12 MOS ENDED 6/97 15.7% 34.7% 17.3%
SINCE INCEPTION* 23.3% 32.9% 17.8%
*From February 1, 1995 (annualized)
</TABLE>
<TABLE>
PORTFOLIO OF INVESTMENTS - MARKMAN AGGRESSIVE ALLOCATION PORTFOLIO -
JUNE 30, 1997 (UNAUDITED)
<CAPTION>
FUND SHARES MARKET VALUE % OF TOTAL STATUS+
<S> <C> <C> <C> <C>
VANGUARD U.S. GROWTH PORTFOLIO ..................................... 333,045 $9,281,971 11.3% +
OAKMARK SMALL CAP FUND* ............................................ 515,243 9,099,191 11.1% -
FRANKLIN MUTUAL EUROPEAN FUND....................................... 659,505 8,494,427 10.3% -
STEIN ROE GROWTH STOCK FUND ........................................ 224,789 7,514,681 9.1% +
PBHG GROWTH FUND* .................................................. 283,130 7,013,126 8.5% NEW
FRANKLIN MUTUAL SHARES FUND ........................................ 313,573 6,622,662 8.1% -
OAKMARK INTERNATIONAL FUND ......................................... 353,105 6,461,823 7.9% -
THE RYDEX SERIES NOVA FUND* ........................................ 233,258 5,222,639 6.4% NEW
YACKTMAN FUND ...................................................... 344,284 5,143,608 6.3% -
T. ROWE PRICE SCIENCE & TECHNOLOGY FUND* ........................... 152,357 4,642,325 5.7% +
THE RYDEX SERIES OTC FUND* ......................................... 205,598 4,463,543 5.4% NEW
AMERICAN CENTURY INTL. DISCOVERY FUND .............................. 480,631 4,171,878 5.0% -
T. ROWE PRICE BLUE CHIP FUND ....................................... 182,938 4,026,470 4.8% -
----------- -------
TOTAL INVESTMENTS (COST $71,395,968) ................................................ 82,158,344 99.9%
----------- -------
OTHER ASSETS AND LIABILITIES (NET) .................................................. 40,298 0.1%
----------- -------
NET ASSETS .......................................................................... $82,198,642 100.0%
=========== =======
*NON-INCOME PRODUCING SECURITY
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
</TABLE>
+ "+" means larger percentage than end of prior quarter, "-" means smaller
percentage than end of prior quarter, "new" means did not appear in prior
quarter.
<PAGE>
THE MARKMAN MULTIFUNDS PERFORMANCE
Markman Moderate Allocation Portfolio
As you know, the Moderate Allocation is the one in which we blend together what
we feel are the most compelling funds and concepts from the Conservative and
Aggressive Allocations.
Under the lid as of 6/30/97
Often what a fund appears to be on the surface is different from
what it actually is in composition. To get a better understanding
of the true nature of the overall portfolio, we "unscrewed the tops" of each of
the funds we own and dumped the contents out on the table. Here's what the
overall mix looked like.
PIECHART:
U.S. STOCKS 52%
INTERNATIONAL STOCKS 24%
BONDS 11%
CASH 13%
By doing this, we hope to create a portfolio with the lower risk/higher return
characteristics that will provide the most "comfortable" approach for the
majority of shareholders.
By definition, then, the Moderate Allocation will always be sensitive to
changes made in the Conservative and Aggressive Allocations. As the year
unfolded, our ongoing analysis pointed to the possibility that the Moderate
Allocation was leaning a bit too much to the cautious side. To rectify this
possible "imbalance," we added positions in Rydex OTC and Nova to the mix. We
believe this has added just the right amount of "oomph" to our basic core of
stable growth and income holdings.
<PAGE>
MARKMAN MODERATE ALLOCATION PORTFOLIO COMPARISON
<TABLE>
PUTTING IT IN PERSPECTIVE BAR CHARTS - GRAPHIC REPRESENTATION
BEHIND THE COMPARISON
<CAPTION>
Markman Moderate S&P 500 Lipper Flexible
Allocation Portfolio Fund Index
<S> <C> <C> <C>
2ND QTR. 1997 8.2% 17.5% 10.0%
12 MOS ENDED 6/97 15.5% 34.7% 18.4%
SINCE INCEPTION* 20.0% 32.9% 19.5%
</TABLE>
*From February 1, 1995 (annualized)
<TABLE>
PORTFOLIO OF INVESTMENTS - MARKMAN MODERATE ALLOCATION PORTFOLIO -
JUNE 30, 1997 (UNAUDITED)
<CAPTION>
FUND SHARES MARKET VALUE % OF TOTAL STATUS+
<S> <C> <C> <C> <C>
FRANKLIN MUTUAL DISCOVERY FUND ....................................... 587,530 $11,497,953 13.4% -
YACKTMAN FUND ........................................................ 731,836 10,933,627 12.8% -
NORTHEAST INVESTORS TRUST............................................. 953,640 10,909,646 12.7% -
FRANKLIN MUTUAL BEACON FUND .......................................... 743,608 10,841,811 12.7% -
JANUS WORLDWIDE FUND ................................................. 230,846 9,252,311 10.8% +
COHEN & STEERS REALTY SHARES ......................................... 170,060 8,018,312 9.4% -
THE RYDEX SERIES NOVA FUND* .......................................... 315,677 7,068,006 8.3% NEW
VANGUARD U.S. GROWTH PORTFOLIO ....................................... 209,326 5,833,912 6.8% -
OAKMARK INTERNATIONAL FUND ........................................... 293,819 5,376,895 6.3% -
THE RYDEX SERIES OTC FUND* ........................................... 182,740 3,967,275 4.6% NEW
THE ROBERTSON STEPHENS PARTNERS FUND ................................. 107,096 1,700,691 1.9% -
----------- ------
TOTAL INVESTMENTS (COST $75,244,364) .................................................. 85,400,439 99.7%
----------- ------
OTHER ASSETS AND LIABILITIES (NET) .................................................... 241,088 0.3%
----------- ------
NET ASSETS ............................................................................ $85,641,527 100.0%
=========== ======
*NON-INCOME PRODUCING SECURITY
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
+ "+" means larger percentage than end of prior quarter, "-" means smaller
percentage than end of prior quarter, "new" means did not appear in prior
quarter.
</TABLE>
<PAGE>
THE MARKMAN MULTIFUNDS PERFORMANCE
Markman Conservative Allocation Portfolio
Return achieved relative to risk taken is what many experienced market observers
look for.
Under the lid as of 6/30/97
Often what a fund appears to be on the surface is different from what it
actually is in composition. To get a better understanding of the true nature of
the overall portfolio, we "unscrewed the tops" of each of the funds we own and
dumped the contents out on the table. Here's what the overall mix looked like.
PIE CHART:
U.S. STOCKS 48%
INTL. STOCKS 10%
BONDS 25%
CASH 17%
This portfolio has produced the lowest returns of the three Markman MultiFunds,
yet I firmly believe it is the best of the allocations we've assembled and
managed.
Gross return is not the final word for all investors. Return achieved relative
to risk taken is what many experienced market observers look for. And from that
perspective, the Conservative Allocation has succeeded admirably. In the rough
of a seemingly "no-lose" bull market, that diamond is often overlooked. But
don't be misled -- it's in there.
Our increasingly positive market view led to some changes
this past quarter, the most significant of which was the replacement of the
defensive positions in Robertson Stephens Contrarian and Lindner Dividend with
Dodge & Cox Balanced. We believe these moves will enable us to generate a bit
more return potential without perceptibly increasing overall risk in the
portfolio.
<PAGE>
MARKMAN CONSERVATIVE ALLOCATION PORTFOLIO COMPARISON
<TABLE>
PUTTING IT IN PERSPECTIVE BAR CHARTS - GRAPHIC REPRESENTATION
BEHIND THE COMPARISON
<CAPTION>
Markman Conservative Lipper Balanced Lehman Int.
Allocation Portfolio Fund Index Govt. Bond Index
<S> <C> <C> <C>
2ND QTR. 1997 5.3% 10.7% 2.8%
12 MOS ENDED 6/97 12.7% 20.5% 6.8%
SINCE INCEPTION* 16.2% 19.9% 7.8%
*From February 1, 1995 (annualized)
</TABLE>
<TABLE>
PORTFOLIO OF INVESTMENTS - MARKMAN CONSERVATIVE ALLOCATION PORTFOLIO
- - JUNE 30, 1997 (UNAUDITED)
<CAPTION>
FUND SHARES MARKET VALUE % OF TOTAL STATUS+
<S> <C> <C> <C> <C>
NORTHEAST INVESTORS TRUST............................................. 579,147 $ 6,625,436 18.0% +
SOGEN INTERNATIONAL FUND, INC ........................................ 228,959 6,573,425 17.8% +
FRANKLIN MUTUAL QUALIFIED FUND ....................................... 265,992 4,912,880 13.3% -
DODGE & COX BALANCED FUND ............................................ 73,111 4,809,261 13.0% NEW
COHEN & STEERS REALTY SHARES ......................................... 83,376 3,931,180 10.7% +
THE MERGER FUND ...................................................... 242,719 3,597,098 9.8% -
YACKTMAN FUND ........................................................ 208,367 3,113,001 8.4% +
T. ROWE PRICE SMALL CAP VALUE FUND ................................... 121,478 2,643,360 7.2% +
----------- --------
TOTAL INVESTMENTS (COST $33,590,380) ................................................ 36,205,641 98.2%
----------- --------
OTHER ASSETS AND LIABILITIES (NET) .................................................. 665,213 1.8%
----------- --------
NET ASSETS .......................................................................... $36,870,854 100.0%
=========== ========
<FN>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
+ "+" means larger percentage than end of prior quarter, "-" means smaller
percentage than end of prior quarter, "new" means did not appear in prior
quarter.
</FN>
</TABLE>
<PAGE>
<TABLE>
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES - JUNE 30, 1997 (UNAUDITED)
<CAPTION>
ASSETS
CONSERVATIVE MODERATE AGGRESSIVE
ALLOCATION ALLOCATION ALLOCATION
PORTFOLIO PORTFOLIO PORTFOLIO
<S> <C> <C> <C>
INVESTMENTS IN SECURITIES:
AT ACQUISITION COST ..................................... $ 33,590,380 $ 75,244,364 $ 71,395,968
============ ============ ============
AT VALUE (NOTE 1) ....................................... $ 36,205,641 $ 85,400,439 $ 82,158,344
CASH ...................................................... 400,623 345,942 208,816
RECEIVABLE FOR SECURITIES SOLD ............................ -- -- --
RECEIVABLE FOR CAPITAL SHARES SOLD ........................ 308,252 15,400 39,429
DIVIDENDS RECEIVABLE ...................................... -- 43 58
OTHER ASSETS .............................................. 380 -- 8,725
------------ ------------ ------------
TOTAL ASSETS ............................................ $ 36,914,896 $ 85,761,824 $ 82,415,372
============ ============ ============
LIABILITIES
PAYABLE FOR CAPITAL SHARES REDEEMED ....................... $ 18,479 $ 56,464 $ 156,190
PAYABLE TO AFFILIATES (NOTE 3) ............................ 25,563 62,702 60,540
OTHER LIABILITIES ......................................... -- 1,131 --
------------ ------------ ------------
TOTAL LIABILITIES ....................................... $ 44,042 $ 120,297 $ 216,730
------------ ------------ ------------
NET ASSETS .............................................. $36,870,854 $ 85,641,527 $ 82,198,642
============ ============ ============
NET ASSETS
NET ASSETS CONSIST OF:
PAID-IN CAPITAL ........................................... $ 33,460,537 $ 74,195,537 $ 69,971,835
ACCUMULATED NET REALIZED GAINS FROM
SECURITY TRANSACTIONS ................................... 500,675 936,114 1,704,154
UNDISTRIBUTED NET INVESTMENT INCOME (LOSS) ................ 294,381 353,801 (239,723)
NET UNREALIZED APPRECIATION ON INVESTMENTS ................ 2,615,261 10,156,075 10,762,376
------------ ------------ ------------
NET ASSETS .............................................. $ 36,870,854 $ 85,641,527 $ 82,198,642
============ ============ ============
SHARES OF BENEFICIAL INTEREST OUTSTANDING (UNLIMITED
NUMBER OF SHARES AUTHORIZED, NO PAR VALUE)(NOTE 4) ...... 2,990,452 6,636,992 5,931,770
============ ============ ============
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING
PRICE PER SHARE (NOTE 1) ............................... $ 12.33 $ 12.90 $ 13.86
============ ============ ============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS - FOR THE SIX MONTH PERIOD ENDED JUNE 30, 1997 (UNAUDITED)
<CAPTION>
CONSERVATIVE MODERATE AGGRESSIVE
ALLOCATION ALLOCATION ALLOCATION
PORTFOLIO PORTFOLIO PORTFOLIO
<S> <C> <C> <C>
INVESTMENT INCOME
DIVIDEND INCOME ................................ $ 485,208 $ 735,105 $ 146,199
------------ ------------ ------------
EXPENSES
INVESTMENT ADVISORY FEES ....................... 185,412 374,583 379,204
INDEPENDENT TRUSTEES' FEES ..................... 6,750 6,750 6,750
------------ ------------ ------------
TOTAL EXPENSES (NOTE 3) ....................... 192,162 381,333 385,954
------------ ------------ ------------
NET INVESTMENT INCOME (LOSS) ................... 293,046 353,772 (239,755)
------------ ------------ ------------
REALIZED AND UNREALIZED GAINS ON INVESTMENTS
NET REALIZED GAINS FROM SECURITY TRANSACTIONS .. 618,027 1,130,697 1,709,257
CAPITAL GAIN DISTRIBUTIONS FROM OTHER
INVESTMENT COMPANIES .......................... 2,423 -- --
NET CHANGE IN UNREALIZED
APPRECIATION/DEPRECIATION ON INVESTMENTS ...... 1,909,406 7,994,079 8,429,711
------------ ------------ ------------
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS 2,529,856 9,124,776 10,138,968
------------ ------------ ------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ..... $ 2,822,902 $ 9,478,548 $ 9,899,213
============ ============ ============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS - FOR THE PERIODS ENDED JUNE 30, 1997
AND DECEMBER 31, 1996
<CAPTION>
CONSERVATIVE MODERATE
ALLOCATION PORTFOLIO ALLOCATION PORTFOLIO
SIX MONTHS SIX MONTHS
JUNE 30, 1997 YEAR ENDED JUNE 30, 1997 YEAR ENDED
FROM OPERATIONS: (UNAUDITED) DEC. 31, 1996 (UNAUDITED) DEC. 31, 1996
<S> <C> <C> <C> <C>
NET INVESTMENT INCOME (LOSS) ................... $ 293,046 $ 964,793 $ 353,772 $ 1,110,324
NET REALIZED GAINS FROM SECURITY TRANSACTIONS .. 618,027 612,693 1,130,697 1,942,355
CAPITAL GAIN DISTRIBUTIONS FROM OTHER
INVESTMENT COMPANIES ........................ 2,423 1,573,569 -- 3,505,633
NET CHANGE IN UNREALIZED APPRECIATION/
DEPRECIATION ON INVESTMENTS ................ 1,909,406 530,876 7,994,079 797,362
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ..... 2,822,902 3,681,931 9,478,548 7,355,674
------------ ------------ ------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS:
DIVIDENDS FROM NET INVESTMENT INCOME ........... -- (963,458) -- (1,110,295)
DISTRIBUTIONS IN EXCESS OF
NET INVESTMENT INCOME (NOTE 1) .............. -- (627,137) -- (860,538)
DISTRIBUTIONS FROM NET REALIZED GAINS .......... -- (1,678,900) -- (4,782,033)
------------ ------------ ------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS
TO SHAREHOLDERS ............................. -- (3,269,495) -- (6,752,866)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS (NOTE4):
PROCEEDS FROM SHARES SOLD ...................... 6,496,547 49,145,757 11,295,863 70,199,331
NET ASSET VALUE OF SHARES ISSUED IN REINVESTMENT
OF DISTRIBUTIONS TO SHAREHOLDERS ............ -- 3,199,781 -- 6,679,202
PAYMENTS FOR SHARES REDEEMED ................... (15,027,727) (20,031,002) (13,759,693) (37,842,170)
------------ ------------ ------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS ................. (8,531,180) 32,314,536 (2,463,830) 39,036,363
------------ ------------ ------------ ------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ........ (5,708,278) 32,726,972 7,014,718 39,639,171
NET ASSETS:
BEGINNING OF PERIOD ............................ 42,579,132 9,852,160 78,626,809 38,987,638
------------ ------------ ------------ ------------
END OF PERIOD .................................. $ 36,870,854 $ 42,579,132 $ 85,641,527 $ 78,626,809
============ ============ ============ ============
UNDISTRIBUTED NET
INVESTMENT INCOME (LOSS) .................... $ 294,381 -- $ 353,801 --
============ ============ ============ ============
<PAGE>
<CAPTION>
AGGRESSIVE
ALLOCATION PORTFOLIO
SIX MONTHS
JUNE 30, 1997 YEAR ENDED
FROM OPERATIONS: (UNAUDITED) DEC. 31, 1996
<S> <C> <C>
NET INVESTMENT INCOME (LOSS) ................... $ (239,755) $ 309,914
NET REALIZED GAINS FROM SECURITY TRANSACTIONS .. 1,709,257 1,705,972
CAPITAL GAIN DISTRIBUTIONS FROM OTHER
INVESTMENT COMPANIES ........................ -- 3,846,983
NET CHANGE IN UNREALIZED APPRECIATION/
DEPRECIATION ON INVESTMENTS ................ 8,429,711 2,238,283
------------ ------------
NET INCREASE IN NET ASSETS FROM OPERATIONS ..... 9,899,213 8,101,152
------------ ------------
FROM DISTRIBUTIONS TO SHAREHOLDERS:
DIVIDENDS FROM NET INVESTMENT INCOME ........... -- (309,882)
DISTRIBUTIONS IN EXCESS OF
NET INVESTMENT INCOME (NOTE 1) .............. -- (689,085)
DISTRIBUTIONS FROM NET REALIZED GAINS .......... -- (4,868,973)
------------ ------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS
TO SHAREHOLDERS ............................. -- (5,867,940)
------------ ------------
FROM CAPITAL SHARE TRANSACTIONS (NOTE4):
PROCEEDS FROM SHARES SOLD ...................... 7,713,404 80,691,707
NET ASSET VALUE OF SHARES ISSUED IN REINVESTMENT
OF DISTRIBUTIONS TO SHAREHOLDERS ............ -- 5,792,545
PAYMENTS FOR SHARES REDEEMED ................... (19,742,873) (46,714,062)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS ................. (12,029,469) 39,770,190
------------ ------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ........ (2,130,256) 42,003,402
NET ASSETS:
BEGINNING OF PERIOD ............................ 84,328,898 42,325,496
------------ ------------
END OF PERIOD .................................. $ 82,198,642 $ 84,328,898
============ ============
UNDISTRIBUTED NET
INVESTMENT INCOME (LOSS) .................... $ (239,723) --
============ ============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
</TABLE>
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS - MARKMAN CONSERVATIVE ALLOCATION
PORTFOLIO
Per share data for a share outstanding throughout
each period
<CAPTION>
SIX MONTHS ENDED YEAR ENDED PERIOD ENDED
JUNE 30, 1997 (UNAUDITED) DECEMBER 31, 1996 DEC. 31,1995 (A)
<S> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD ..................... $ 11.49 $ 10.97 $ 10.00
------------- ------------- -------------
INCOME FROM INVESTMENT OPERATIONS:
NET INVESTMENT INCOME ................................... 0.10 0.28 0.19
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS ........ 0.74 1.19 1.61
------------- ------------- -------------
TOTAL FROM INVESTMENT OPERATIONS ........................ 0.84 1.47 1.80
------------- ------------- -------------
LESS DISTRIBUTIONS
DIVIDENDS FROM NET INVESTMENT INCOME .................... -- (0.28) (0.19)
DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME ........ -- (0.18) (0.04)
DISTRIBUTIONS FROM NET REALIZED GAINS ................... -- (0.49) (0.60)
------------- ------------- -------------
TOTAL DISTRIBUTIONS ....................................... -- (0.95) (0.83)
------------- ------------- -------------
NET ASSET VALUE - END OF PERIOD ........................... $ 12.33 $ 11.49 $ 10.97
============= ============= =============
TOTAL RETURN .............................................. 7.31% 13.41% 18.00%
============= ============= =============
NET ASSETS - END OF PERIOD (000'S) ........................ $ 36,871 $ 42,579 $ 9,852
============= ============= =============
RATIO OF EXPENSES TO AVERAGE NET ASSETS ................... 0.95%(B) 0.95% 0.95%(B)
RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS ...... 1.45%(B) 3.21% 3.02%(B)
PORTFOLIO TURNOVER RATE ................................... 40%(B) 104% 176%
<CAPTION>
FINANCIAL HIGHLIGHTS - MARKMAN MODERATE ALLOCATION
PORTFOLIO
Per share data for a share outstanding throughout
each period
<S> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD ..................... $ 11.49 $ 11.31 $ 10.00
------------- ------------- -------------
INCOME FROM INVESTMENT OPERATIONS:
NET INVESTMENT INCOME ................................... 0.05 0.18 0.06
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS ........ 1.36 1.08 2.39
------------- ------------- -------------
TOTAL FROM INVESTMENT OPERATIONS ........................ 1.41 1.26 2.45
LESS DISTRIBUTIONS:
DIVIDENDS FROM NET INVESTMENT INCOME .................... -- (0.18) (0.06)
DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME ........ -- (0.14) (0.24)
DISTRIBUTIONS FROM NET REALIZED GAINS ................... -- (0.76) (0.84)
------------- ------------- -------------
TOTAL DISTRIBUTIONS ....................................... -- (1.08) (1.14)
------------- ------------- -------------
NET ASSET VALUE - END OF PERIOD ........................... $ 12.90 $ 11.49 $ 11.31
============= ============= =============
TOTAL RETURN .............................................. 12.27% 11.11% 24.50%
============= ============= =============
NET ASSETS - END OF PERIOD (000'S) ........................ $ 85,642 $ 78,627 $ 38,988
============= ============= =============
RATIO OF EXPENSES TO AVERAGE NET ASSETS ................... 0.95%(B) 0.95% 0.95%(B)
RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS ...... 0.88%(B) 1.34% 0.77%(B)
PORTFOLIO TURNOVER RATE ................................... 49%(B) 280% 141%
<CAPTION>
FINANCIAL HIGHLIGHTS - MARKMAN AGGRESSIVE ALLOCATION
PORTFOLIO
Per share data for a share outstanding throughout
each period
<S> <C> <C> <C>
NET ASSET VALUE - BEGINNING OF PERIOD ..................... $ 12.26 $ 11.79 $ 10.00
------------- ------------- -------------
INCOME FROM INVESTMENT OPERATIONS:
NET INVESTMENT INCOME (LOSS) ............................ (0.04) 0.05 0.01
NET REALIZED AND UNREALIZED GAINS ON INVESTMENTS ........ 1.64 1.34 3.11
------------- ------------- -------------
TOTAL FROM INVESTMENT OPERATIONS .......................... 1.60 1.39 3.12
------------- ------------- -------------
LESS DISTRIBUTIONS:
DIVIDENDS FROM NET INVESTMENT INCOME .................... -- (0.05) (0.01)
DISTRIBUTIONS IN EXCESS OF NET INVESTMENT INCOME ........ -- (0.11) (0.23)
DISTRIBUTIONS FROM NET REALIZED GAINS ................... -- (0.76) (1.09)
------------- ------------- -------------
TOTAL DISTRIBUTIONS ....................................... -- (0.92) (1.33)
------------- ------------- -------------
NET ASSET VALUE - END OF PERIOD ........................... $ 13.86 $ 12.26 $ 11.79
============= ============= =============
TOTAL RETURN .............................................. 13.05% 11.72% 31.21%
============= ============= =============
NET ASSETS - END OF PERIOD (000'S) ..................... $ 82,199 $ 84,329 $ 42,325
============= ============= =============
RATIO OF EXPENSES TO AVERAGE NET ASSETS ................... 0.95%(B) 0.95% 0.95%(B)
RATIO OF NET INVESTMENT INCOME (LOSS) TO
AVERAGE NET ASSETS ...................................... (0.59%)(B) 0.34% 0.15%(B)
PORTFOLIO TURNOVER RATE ................................... 107%(B) 340% 204%
<FN>
(A) Represents the period from the initial public offering of shares
(January 26, 1995) through December 31, 1995.
(B) Annualized.
</FN>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
NOTES TO FINANCIAL STATEMENTS - UNAUDITED
1. SIGNIFICANT ACCOUNTING POLICIES
Markman MultiFund Trust (the Trust) is registered under the Investment Company
Act of 1940, as amended (the 1940 Act), as an open-end non-diversified
management investment company. The Trust was organized as a Massachusetts
business trust on September 7, 1994. The Trust offers three series of shares to
investors: the Markman Conservative Allocation Portfolio, the Markman Moderate
Allocation Portfolio and the Markman Aggressive Allocation Portfolio
(collectively, the Funds). The Trust was capitalized on November 28, 1994, when
the Funds' investment adviser, Markman Capital Management, Inc. (the Adviser),
purchased the initial shares of each Fund at $10.00 per share. The public
offering of shares commenced on January 26, 1995. The Trust had no operations
prior to the public offering of shares except for the initial issuance of shares
to the Adviser.
The Markman Conservative Allocation Portfolio seeks to provide current income
and low to moderate growth of capital. The Markman Moderate Allocation Portfolio
seeks growth of capital and a reasonable level of current income. The Markman
Aggressive Allocation Portfolio seeks capital appreciation without regard to
current income.
THE FOLLOWING IS A SUMMARY OF THE TRUST'S SIGNIFICANT ACCOUNTING POLICIES:
SECURITIES VALUATION -- The Funds' portfolio securities are valued as of the
close of business of the regular session of trading on the New York Stock
Exchange (currently 4:00 p.m., Eastern time). Shares of open-end management
investment companies (mutual funds) in which the Funds invest are valued at
their respective net asset values as determined under the 1940 Act. Such mutual
funds value securities in their portfolios for which market quotations are
readily available at their current market value (generally the last reported
sale price) and all other securities and assets at fair value pursuant to
methods established in good faith by the Board of Trustees or Directors of the
underlying mutual fund. Money market funds generally value securities in their
portfolios on an amortized cost basis, which approximates market.
SHARE VALUATION -- The net asset value per share of each Fund is calculated
daily by dividing the total value of that Fund's assets, less liabilities, by
the number of shares outstanding, rounded to the nearest cent. The offering and
redemption price per share of each Fund are equal to the net asset value per
share.
INVESTMENT INCOME -- Dividend income is recorded on the
ex-dividend date. For financial reporting purposes, the Funds record
distributions of short-term and long-term capital gains made by mutual funds in
which the Funds invest as realized gains. For tax purposes, the short-term
portion of such distributions is treated as dividend income by the Funds.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions to shareholders arising from each
Fund's net investment income and net realized capital gains, if any, are
distributed at least once each year. Income distributions and capital gain
distributions are determined in accordance with income tax regulations, which
may differ from generally accepted accounting principles.
SECURITY TRANSACTIONS -- Security transactions are accounted for on the trade
date. Securities sold are valued on a specific identification basis.
ESTIMATES -- The preparation of financial statements in conformity with
generally accepted accounting principles ("GAAP") requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period.
Actual results could differ from those estimates.
FEDERAL INCOME TAX -- It is each Fund's policy to comply with the special
provisions of the Internal Revenue Code available to regulated investment
companies. As provided therein, in any fiscal year in which a Fund so qualifies
and distributes at least 90% of its taxable net income, the Fund (but not the
shareholders) will be relieved of federal income tax on the income distributed.
Accordingly, no provision for income taxes has been made.
In order to avoid imposition of the excise tax applicable to regulated
investment companies, it is also each Fund's intention to declare as dividends
in each calendar year at least 98% of its net investment income (earned during
the calendar year) and 98% of its net realized capital gains (earned during the
twelve months ended October 31) plus undistributed amounts from prior years.
Each of the Funds files a tax return annually using tax accounting methods
required under provisions of the Code which may differ from GAAP, the basis on
which these financial statements are prepared. The differences arise primarily
from the treatment of short-term gain distributions made by mutual funds in
which the Funds invest and the deferral of certain losses under federal income
tax regulations. Accordingly, the amount of net investment income and net
realized capital gain or losses reported in the financial statements may differ
from that reported in the Fund's tax return and, consequently, the character of
distributions to shareholders reported in the Statement of Changes in Net Assets
and the Financial Highlights may differ from that reported to shareholders for
federal income tax purposes. As a result of such differences, reclassifications
were made to the components of net assets to conform with generally accepted
accounting principles.
FEDERAL INCOME TAX
The following information is based upon the federal income tax cost of portfolio
investments of the Funds as of June 30, 1997:
<TABLE>
CONSERVATIVE MODERATE AGGRESSIVE
ALLOCATION ALLOCATION ALLOCATION
PORTFOLIO PORTFOLIO PORTFOLIO
<S> <C> <C> <C>
GROSS UNREALIZED APPRECIATION $ 2,676,026 $ 10,177,227 $ 10,828,000
GROSS UNREALIZED DEPRECIATION (60,765) (21,152) (65,624)
------------ ------------ ------------
NET UNREALIZED APPRECIATION $ 2,615,261 $ 10,156,075 $ 10,762,376
============ ============ ============
FEDERAL INCOME TAX COST
OF PORTFOLIO INVESTMENTS $ 33,590,380 $ 75,244,364 $ 71,395,968
============ ============ ============
</TABLE>
<PAGE>
2. INVESTMENT TRANSACTIONS
During the six months ended June 30, 1997, purchases and proceeds from sales and
maturities of portfolio securities, other than short-term investments, amounted
to $7,959,651 and $16,784,120, respectively, for the Markman Conservative
Allocation Portfolio, $19,518,016 and $21,323,450, respectively, for the Markman
Moderate Allocation Portfolio, and $42,883,840 and $54,392,823, respectively,
for the Markman Aggressive Allocation Portfolio.
3. TRANSACTIONS WITH AFFILIATES
The Chairman of the Board and President of the Trust is also the President of
Markman Capital Management, Inc. (the Adviser). Certain other trustees and
officers of the Trust are officers of the Adviser or of Countrywide Fund
Services, Inc. (CFS), the administrative services agent, shareholder servicing
and transfer agent, and accounting services agent for the Trust.
INVESTMENT ADVISORY AGREEMENT
The Funds' investments are managed by the Adviser pursuant to the terms of
an Investment Management Agreement. Each Fund pays the Adviser an investment
management fee, computed and accrued daily and paid monthly, at an annual rate
of .95% of average daily net assets. The Adviser pays all operating expenses of
the Funds except brokerage commissions, taxes, interest, fees and expenses of
independent trustees and any extraordinary expenses.
In addition, the Adviser is contractually obligated to reduce its investment
management fee in an amount equal to each Fund's allocable portion of the fees
and expenses of the Trust's independent trustees.
ADMINISTRATIVE, ACCOUNTING, AND TRANSFER AGENCY AGREEMENT
Under the terms of the Administration, Accounting, and Transfer Agency Agreement
between the Trust, the Adviser and CFS, CFS supplies non-investment related
statistical and research data, internal regulatory compliance services and
executive and administrative services for the Funds. CFS supervises the
preparation of tax returns, reports to shareholders of the Funds, reports to and
filings with the Securities and Exchange Commission and state securities
commissions and materials for meetings of the Board of Trustees, maintains the
records of each shareholder's account, answers shareholders' inquiries
concerning their accounts, processes purchases and redemptions of each Fund's
shares, acts as dividend and distribution disbursing agent and performs other
shareholder service functions, calculates the daily net asset value per share
and maintains the financial books and records of each Fund. For the performance
of these services, the Adviser, out of its investment management fee, pays CFS a
monthly base fee, an asset based fee, and a fee based on the number of
shareholder accounts. In addition, the Adviser pays out-of-pocket expenses
including, but not limited to, postage and supplies.
<PAGE>
4. FUND SHARE TRANSACTIONS
Proceeds and payments on capital shares as shown in the State ments of Changes
in Net Assets are the result of the following capital share transactions for the
periods ended June 30, 1996 and December 31, 1995:
<TABLE>
<CAPTION>
CONSERVATIVE MODERATE AGGRESSIVE
ALLOCATION ALLOCATION ALLOCATION
PORTFOLIO PORTFOLIO PORTFOLIO
<S> <C> <C> <C>
SIX MONTHS ENDED JUNE 30, 1997
(UNAUDITED):
SHARES SOLD 553,579 935,645 599,801
SHARES ISSUED IN REINVESTMENT OF
DISTRIBUTIONS TO SHAREHOLDERS -- -- --
LESS SHARES REDEEMED (1,269,923) (1,141,237) (1,547,372)
---------- ---------- ----------
NET DECREASE
IN SHARES OUTSTANDING (716,344) (205,592) (947,571)
SHARES OUTSTANDING,
BEGINNING OF PERIOD 3,706,796 6,842,584 6,879,341
---------- ---------- ----------
SHARES OUTSTANDING,
END OF PERIOD 2,990,452 6,636,992 5,931,770
========== ========== ==========
YEAR ENDED DECEMBER 31, 1996:
SHARES SOLD 4,224,322 5,984,900 6,577,451
SHARES ISSUED IN REINVESTMENT
OF DISTRIBUTIONS TO SHAREHOLDERS 278,484 581,306 472,475
LESS SHARES REDEEMED (1,694,000) (3,169,616) (3,759,415)
---------- ---------- ----------
NET INCREASE IN
SHARES OUTSTANDING 2,808,806 3,396,590 3,290,511
SHARES OUTSTANDING,
BEGINNING OF YEAR 897,990 3,445,994 3,588,830
---------- ---------- ----------
SHARES OUTSTANDING,
END OF YEAR 3,706,796 6,842,584 6,879,341
========== ========== ==========
</TABLE>
<PAGE>
FIRST CLASS
LOGO:
The Markman MultiFunds
6600 France Avenue So., Suite 565
Minneapolis, Minnesota 55435
Portfolio/Strategy
Update
To hear Bob Markman's weekly market overview and MultiFund activity report, dial
1-800-975-5463.
Prospectus
For copies of the Markman Prospectus, dial 1-800-395-4848.
PriceLine
Call anytime for up-to-the-minute net asset values at 1-800-536-8679.
HelpLine
For an application form, for assistance in completing an application, or for
general administrative questions, dial 1-800-707-2771.
OnLine
Bob's on the Internet!
Check for net asset values and more
at http://www.markman.com
Authorized for distribution only if preceded or accompanied by a current
prospectus.
100% NO-LOAD Mutual Fund Council
Investing in
The Markman MultiFunds
Investment forms may be ordered by calling 1-800-707-2771.
These forms are available:
o Account Application
o IRA Application
o IRA Transfer Request
o Dollar Cost Averaging Application
o Systematic Withdrawal Plan Request
o Automatic Investment Request
o Company Retirement Account
Application
o Company Retirement Plan Prototype
[includes Profit Sharing, Money Purchase, 401(k)]
o 403(b) Plan and Application
The minimum direct investment is $25,000. If you want to invest less than
$25,000, you may purchase The Markman MultiFunds through: Charles Schwab &
Company (1-800-266-5623), Jack White and Company (1-800-323-3263), Fidelity
Investments (1-800-544-7558), and Waterhouse Securities (1-800-934-4443), among
others. There is no transaction fee when you purchase the Markman MultiFunds
through these discount brokers.
For additional forms or answers to any questions just contact The Markman
MultiFunds (between the hours of 8:30 AM and 5:30 PM EST):
Toll-free: 1-800-707-2771
In Cincinnati: 513-629-2070
Investment Adviser
Markman Capital Management, Inc.
6600 France Ave. So., Suite 565
Minneapolis, Minnesota 55435
Telephone: 612-920-4848
Toll-free: 1-800-395-4848
Shareholder Services
c/o Countrywide Fund Services, Inc.
312 Walnut Street, 21st Floor
Cincinnati, Ohio 45202-3874
Telephone: 513-629-2070
Toll-free: 1-800-707-2771
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 1
<NAME> MARKMAN AGGRESSIVE ALLOCATION PORTFOLIO
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 71,395,968
<INVESTMENTS-AT-VALUE> 82,158,344
<RECEIVABLES> 39,487
<ASSETS-OTHER> 8,725
<OTHER-ITEMS-ASSETS> 208,816
<TOTAL-ASSETS> 82,415,372
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 216,730
<TOTAL-LIABILITIES> 216,730
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 69,971,835
<SHARES-COMMON-STOCK> 5,931,770
<SHARES-COMMON-PRIOR> 6,879,341
<ACCUMULATED-NII-CURRENT> (239,723)
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 1,704,154
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 10,762,376
<NET-ASSETS> 82,198,642
<DIVIDEND-INCOME> 146,199
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 385,954
<NET-INVESTMENT-INCOME> (239,755)
<REALIZED-GAINS-CURRENT> 1,709,257
<APPREC-INCREASE-CURRENT> 8,429,711
<NET-CHANGE-FROM-OPS> 9,899,213
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 599,801
<NUMBER-OF-SHARES-REDEEMED> 1,547,372
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (2,130,256)
<ACCUMULATED-NII-PRIOR> 32
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 5,103
<GROSS-ADVISORY-FEES> 379,204
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 385,954
<AVERAGE-NET-ASSETS> 81,915,122
<PER-SHARE-NAV-BEGIN> 12.26
<PER-SHARE-NII> (0.04)
<PER-SHARE-GAIN-APPREC> 1.64
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 13.86
<EXPENSE-RATIO> .95
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 2
<NAME> MARKMAN MODERATE ALLOCATION PORTFOLIO
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 75,244,364
<INVESTMENTS-AT-VALUE> 85,400,439
<RECEIVABLES> 15,443
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 345,942
<TOTAL-ASSETS> 85,761,824
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 120,297
<TOTAL-LIABILITIES> 120,297
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 74,195,537
<SHARES-COMMON-STOCK> 6,636,992
<SHARES-COMMON-PRIOR> 6,842,584
<ACCUMULATED-NII-CURRENT> 353,801
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 936,114
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 10,156,075
<NET-ASSETS> 85,641,527
<DIVIDEND-INCOME> 735,105
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 381,333
<NET-INVESTMENT-INCOME> 353,772
<REALIZED-GAINS-CURRENT> 1,130,697
<APPREC-INCREASE-CURRENT> 7,994,079
<NET-CHANGE-FROM-OPS> 9,478,548
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 935,645
<NUMBER-OF-SHARES-REDEEMED> 1,141,237
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 7,014,718
<ACCUMULATED-NII-PRIOR> 29
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 194,583
<GROSS-ADVISORY-FEES> 374,583
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 381,333
<AVERAGE-NET-ASSETS> 80,983,136
<PER-SHARE-NAV-BEGIN> 11.49
<PER-SHARE-NII> 0.05
<PER-SHARE-GAIN-APPREC> 1.36
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.90
<EXPENSE-RATIO> .95
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<SERIES>
<NUMBER> 3
<NAME> MARKMAN CONSERVATIVE ALLOCATION PORTFOLIO
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<INVESTMENTS-AT-COST> 33,590,380
<INVESTMENTS-AT-VALUE> 36,205,641
<RECEIVABLES> 308,252
<ASSETS-OTHER> 380
<OTHER-ITEMS-ASSETS> 400,623
<TOTAL-ASSETS> 36,914,896
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 44,042
<TOTAL-LIABILITIES> 44,042
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 33,460,537
<SHARES-COMMON-STOCK> 2,990,452
<SHARES-COMMON-PRIOR> 3,706,796
<ACCUMULATED-NII-CURRENT> 294,381
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 500,675
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 2,615,261
<NET-ASSETS> 36,870,854
<DIVIDEND-INCOME> 485,208
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 192,162
<NET-INVESTMENT-INCOME> 293,046
<REALIZED-GAINS-CURRENT> 620,450
<APPREC-INCREASE-CURRENT> 1,909,406
<NET-CHANGE-FROM-OPS> 2,822,902
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 553,579
<NUMBER-OF-SHARES-REDEEMED> 1,269,923
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (5,708,278)
<ACCUMULATED-NII-PRIOR> 1,335
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 119,775
<GROSS-ADVISORY-FEES> 185,412
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 192,162
<AVERAGE-NET-ASSETS> 40,758,931
<PER-SHARE-NAV-BEGIN> 11.49
<PER-SHARE-NII> 0.10
<PER-SHARE-GAIN-APPREC> 0.74
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 12.33
<EXPENSE-RATIO> .95
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
