1838 INVESTMENT ADVISORS FUNDS, N-30D, 2000-01-05

1838 INVESTMENT ADVISORS FUNDS
N-30D, 2000-01-05

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1838 INTERNATIONAL EQUITY FUND

- --------------------------------------------------------------------------------

FELLOW SHAREHOLDER:

Crisis, what crisis? September 1998, a little over a year ago, the equity
markets around the world were depressed due to economic and financial crises in
Asia, Russia and Latin America. Yet, at the end of October 1999, the Morgan
Stanley Capital International Europe, Australia and Far East Index (the "EAFE")
stood near its highest level ever, after returning 23% in U.S. dollars in 12
months. Markets that were hit hardest during the crisis recovered the fastest:
The emerging markets index returned 45.4% during this fiscal year of our Fund,
and the emerging markets of Asia did even better at 67.4%. At present, news from
around the world is predominantly about how industrial production and economic
growth is above expectations -- albeit with some exceptions in Asia, Latin
America and Eastern Europe.

Your Fund's net asset value per share, taking into account the distributions
made in December 1998, rose 29.1% during the year ending October 31, 1999, 6.1%
above the EAFE benchmark of 23.4%. Considering the volatility of the equity
markets during this period, we are happy to be able to report these results. A
year ago, it would have seemed prudent to hold some cash in the portfolio,
emphasize European equities, and within industries, emphasize generally
defensive industries such as utilities. The result of such an investment
approach would have provided a stable return of close to zero and thus have
resulted in missing out on the tremendous rally in primarily Asian stock markets
and in the more cyclical industries. Our investment style of managing fully
invested portfolios with at all times broad regional and industry
diversification requires us to identify quality regional leaders whenever and
where ever in the world regardless of market sentiment. Thus we made some of our
largest capital gains in two Japanese consumer finance companies, Takefuji and
Aiful earlier this year, while foreign investors poured money into this market.
However, we were late in investing in Japanese banks- which we considered to be
suffering from overcapacity in the industry, terrible balance sheets and
generally uninspiring management- and did not benefit from the rally caused by
large scale consolidation in the industry. We also received an especially large
performance boost from Korean holdings like Pohang Iron & Steel and Korea
Electric Power, and in the telecomunications area, Vodafone in the UK, Nokia in
Finland, Mannesmann in Germany and China Telecom in Hong Kong/China.

New names in the Fund's portfolio include Nortel Networks (with Lucent and
Ericsson in the global top three of telecommunications equipment producers),
Deutsche Bank (leading European bank which acquired Bankers Trust), Murata
Manufacturing and NEC in Japan (both leading electronic components
manufacturers), Cifra (Mexican WalMart affiliate), and DBS and Singapore
Airlines (Singapore's leading bank and airline). All have the quality management
teams, balance sheets and market positions in place that should enable them to
grow company earnings substantially over the next years.

Creating shareholder value is increasingly the top priority of management of
overseas companies, which should benefit all of us as shareholders of this Fund.
Continuing improvement in economic growth, as forecasted by the IMF, OECD and
many leading economists, should boost sales and earnings for most companies,
particularly since inflationary pressures appear to remain subdued. At this
time, the biggest risk for the stock markets overseas seems to be the
possibility of rising interest rates in the U.S. However, lower equity
valuations overseas in combination with generally lower bond yields and
potential for further company earnings growth could well support international
equity markets, should the US markets lose steam.

1
<PAGE>

1838 INTERNATIONAL EQUITY FUND

- --------------------------------------------------------------------------------

International Equity Fund
Comparison of Change in Value of $10,000 Investment*

Average Annual Total Returns
for the Periods Ended
October 31, 1999
- --------------------------------------------------------------------------------

Final Value of a
1 Year Since Inception $10,000 Investment
------ --------------- ------------------
Fund 29.10% 12.80% $16,675
EAFE 23.03% 9.81% 14,882

In the printed version there appears a line graph with
the following plot points depicted:

1838 International
Equity Fund EAFE
------------------ ----
3-Aug-95 10000 10000
Oct-95 9610 9544
Oct-96 10485 10544
Oct-97 12082 11032
Oct-98 12916 12096
Oct-99 16675 14882

* Past performance of the Fund is not predictive of future performance. The 1838
International Equity Fund commenced operations on August 3, 1995. The values
shown reflect a hypothetical initial investment of $10,000 with distributions
reinvested. Returns may be higher due to 1838 Investment Advisors, Inc.
maintenance of the Fund's expenses. Please bear in mind that investing in
foreign securities involves special risks such as currency fluctuation, less
extensive regulation of foreign brokers and possible political instability.
The EAFE is an unmanaged index representing the market value weighted price of
1,100 stocks of the major stock exchanges in Europe, Australia and the Far
East without any associated expenses and the returns assume reinvestment of
all distributions. You cannot invest directly in an index. Please read the
prospectus carefully before investing. Distributed by MBIA Capital Management
Corporation. See Financial Highlights on page 23.

Sincerely,

/s/ Hans van den Berg
---------------------
Hans van den Berg
Vice President & Portfolio Manager

2
<PAGE>

1838 INTERNATIONAL EQUITY FUND

SCHEDULE OF INVESTMENTS OCTOBER 31, 1999
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Value
Shares (Note 2)
--------- -----------
<S> <C> <C> <C>
COMMON STOCK -- 99.21%
AUSTRALIA -- 0.83%
Woodside Petroleum Ltd. Oil & Gas........................... 120,000 $ 722,698
-----------
FINLAND -- 2.14%
Nokia Corp. - Sponsored ADR Information Technology Hardware..... 16,000 1,849,000
-----------
FRANCE -- 8.93%
Accor SA Leisure, Entertainment & Hotels..... 2,500 562,329
AXA, Inc. Insurance........................... 8,500 1,198,077
Cap Gemini SA Software & Computer Services........ 7,000 1,059,491
Lafarge Construction & Building Materials... 7,670 737,655
Schlumberger, Ltd. Oil & Gas Services.................. 14,000 847,875
Societe Generale (A Shares) Banks............................... 7,834 1,704,476
Total SA (B Shares) Oil & Gas........................... 12,000 1,620,769
-----------
7,730,672
-----------
GERMANY -- 7.05%
Adidas-Salomon AG Household Goods & Textiles.......... 8,500 614,673
DaimlerChrysler AG Automobiles......................... 7,135 554,746
Deutsche Bank AG Banks............................... 15,400 1,103,931
Henkel KGAA Chemicals........................... 12,000 708,850
Karstadt AG General Retailers................... 18,000 813,538
Mannesmann AG Telecommunication Services.......... 10,000 1,571,369
SAP AG - Sponsored ADR Software & Computer Services........ 20,000 731,250
-----------
6,098,357
-----------
HONG KONG -- 2.41%
China Telecom HK Ltd.
- Sponsored ADR * Telecommunication Services.......... 15,000 1,012,500
HSBC Holdings plc Banks............................... 67,404 808,987
Huaneng Power Int'l., Inc.
- Sponsored ADR Electricity......................... 22,000 266,750
-----------
2,088,237
-----------
IRELAND -- 2.09%
Allied Irish Banks - Sponsored ADR Banks............................... 33,000 827,063
Elan Corp. plc - Sponsored ADR * Pharmaceuticals..................... 38,000 978,500
-----------
1,805,563
-----------
</TABLE>

See notes to financial statements.

3
<PAGE>

1838 INTERNATIONAL EQUITY FUND

SCHEDULE OF INVESTMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 2)
--------- -----------
ITALY -- 3.98%
<S> <C> <C> <C>
ENI SPA - Sponsored ADR Oil & Gas........................... 15,000 $ 881,250
TIM SPA Telecommunication Services 200,000 1,248,686
Unicredito Italiano RNC Banks............................... 75,000 261,720
Unicredito Italiano SPA Banks............................... 225,000 1,052,396
-----------
3,444,052
-----------

JAPAN -- 27.76%
Advantest Corp. Information Technology Hardware..... 12,900 1,940,686
Aiful Corp. Specialty & Other Finance........... 13,200 2,049,061
Bank of Tokyo-Mitsubishi Ltd. Banks............................... 55,000 910,694
Fanuc Ltd. Electronic & Electrical Equipment... 21,000 1,629,935
Fujitsu Support and Service Software & Computer Services........ 4,000 1,123,036
Hitachi Ltd. Electronic & Electrical Equipment 70,000 755,941
Honda Motor Co. Ltd. Automobiles......................... 22,000 927,559
Hoya Corp. Health.............................. 15,000 1,077,999
KAO Corp. Personal Care & Household Products.. 80,000 2,437,716
Minebea Co. Ltd. Electronic & Electrical Equipment... 100,000 1,346,301
Murata Manufacturing Co. Ltd. Information Technology Hardware..... 8,000 1,027,213
NEC Corporation Information Technology Hardware..... 65,000 1,314,201
Nippon Telegraph & Telephone Telecommunication Services.......... 80 1,226,524
Nomura Securities Co. Ltd. Specialty & Other Finance........... 70,000 1,154,370
Takeda Chemicals Industries Pharmaceuticals..................... 30,000 1,721,924
Takefuji Corporation Speciality & Other Finance.......... 12,000 1,552,319
TDK Corp. Household Goods & Textiles.......... 8,000 782,675
Tokio Marine & Fire Insurance Insurance........................... 80,000 1,046,378
-----------
24,024,532
-----------

MEXICO -- 1.08%
Cifra SA de CV ADR * General Retailers................... 60,000 936,828
-----------

NETHERLANDS -- 5.90%
Akzo Nobel Chemicals........................... 22,000 946,689
ASM Lithography Holding NV * Information Technology Hardware..... 15,000 1,089,375
ING Groep, NV Banks............................... 20,669 1,218,328
Philips Electronics - NY Shares Electronic & Electrical Equipment... 9,200 956,225
Unilever NV - NY Shares Food Producers & Processors......... 13,392 893,079
-----------
5,103,696
-----------
PORTUGAL -- 0.94%
BPI-SGPS SA - Reg. Shares Specialty & Other Finance........... 202,945 810,585
-----------
</TABLE>

See notes to financial statements.

4
<PAGE>

1838 INTERNATIONAL EQUITY FUND

SOUTH KOREA -- 2.61%
Pohang Iron & Steel Steel & Other Materials............. 7,000 840,350
SK Telecom Co. Ltd. Telecommunication Services.......... 1,229 1,419,062
-----------
2,259,412
-----------

SPAIN -- 3.29%
Argentaria SA Banks............................... 30,000 665,335
Banco Santander Central Hispano SA Banks............................... 2,748 28,508
Endesa - Sponsored ADR Electricity......................... 40,000 797,500
Telefonica SA - Sponsored ADR Telecommunication Services.......... 27,237 1,360,148
-----------
2,851,419
-----------

SWEDEN -- 3.79%
ABB Ltd.* Engineering & Machinery............. 11,195 1,112,950
Electrolux AB (B Series) Household Goods & Textiles.......... 57,000 1,134,714
Svenska Cellulosa AB (B Shares) Forestry & Paper.................... 38,500 1,037,484
-----------
3,285,148
-----------

SWITZERLAND -- 5.90%
Adecco SA - Registered Shares Support Services.................... 2,500 1,516,046
Nestle SA - Sponsored ADR Food Procedurers & Processors....... 11,300 1,090,147
Roche Holding AG Genuss Pharmaceuticals..................... 90 1,080,921
Zurich Allied AG Insurance........................... 2,500 1,415,961
-----------
5,103,075
-----------

UNITED KINGDOM -- 16.81%
Barratt Developments plc Construction & Building Materials... 200,000 774,505
Bass plc Beverages........................... 60,000 654,719
BP Amoco Oil & Gas........................... 261,059 2,531,667
British Aerospace plc Aerospace & Defence................. 174,889 1,025,937
Imperial Chemical Industries plc Chemicals........................... 85,000 847,320
Kingfisher plc General Retailers................... 88,647 968,042
Lloyds TSB Group plc Banks............................... 57,196 789,303
Misys plc Software & Computer Services........ 125,706 1,050,951
Pearson plc Media & Photography................. 40,000 891,993
Prudential Corporation plc Life Assurance...................... 65,000 1,018,055
</TABLE>

See notes to financial statements.

5
<PAGE>

1838 INTERNATIONAL EQUITY FUND

SCHEDULE OF INVESTMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 2)
--------- -----------
UNITED KINGDOM -- (CONTINUED)
<S> <C> <C> <C>
Rentokil Initial plc Support Services.................... 100,000 $ 333,103
Royal Bank of Scotland Group plc Banks............................... 50,302 1,153,917
TI Group plc Engineering & Machinery............. 158,000 1,068,160
Vodafone Group plc - Sponsored ADR Telecommunication Services.......... 30,000 1,438,125
-----------
14,545,797
-----------

UNITED STATES -- 1.43%
Nortel Networks Corp. Information Technology Hardware..... 20,000 1,238,750
-----------

TOTAL COMMON STOCKS (Cost $66,658,641)............................................ 85,861,155

SHORT-TERM INVESTMENT -- 0.35%
A.I.M. Liquid Asset Portfolio (Cost $303,390)................................... 303,390 303,390
-----------

TOTAL INVESTMENTS (Cost $66,962,031)+ -- 99.56%................................... $86,164,545

OTHER ASSETS AND LIABILITIES, NET -- 0.44%........................................ 382,481
-----------

NET ASSETS -- 100.00%............................................................. $86,547,026
===========
</TABLE>

<TABLE>
<S> <C>
MARKET SECTOR DIVERSIFICATION (UNAUDITED)
As a Percentage of Total Common Stocks
Resources -- 7.69% Utilities -- 1.24%
Basic Industries -- 6.86% Information Technology -- 14.47%
General Industries -- 9.20% Financials -- 25.49%
Cyclical Consumer Goods -- 4.68% -- Banks -- 13.56%
Non-Cyclical Consumer Goods -- 11.57% -- Insurance -- 4.26%
Cyclical Services -- 8.00% -- Life Assurance -- 1.19%
Non-Cyclical Services -- 10.80% -- Specialty & Other -- 6.48%
</TABLE>

* Non-income producing.

+ The cost for federal income tax purposes was $66,962,031. At October 31, 1999,
net unrealized appreciation was $19,202,514. This consisted of aggregate gross
unrealized appreciation for all securities in which there was an excess of
market value over tax cost of $24,388,985, and aggregate gross unrealized
depreciation for all securities in which there was an excess of tax cost over
market value of $5,186,471.

ADR -- American Depository Receipt

See notes to financial statements.

6
<PAGE>

1838 SMALL CAP EQUITY FUND

- --------------------------------------------------------------------------------

FELLOW SHAREHOLDER:

Fiscal 1999 proved to be a challenging year for the 1838 Small Cap Equity Fund.
The Fund declined 4.3% versus a 14.9% increase for the Russell 2000 Index and
0.7% increase for the Russell 2000 Value Index benchmarks. Overall, the year was
marked by the continuation of trends that were established during the latter
half of calendar 1998 -namely that technology and Internet-related stocks, as
well as large capitalization stocks, provided the dominant and driving factors
for stock appreciation. The investment backdrop was characterized by several key
factors, including high market volatility, fear of rising interest rates, and
investor preference for large cap liquid investments, as well as an obsession
with technology and the Internet.

Small cap, low P/E investing generated disappointing results over the last
fiscal year. The key to successful investments over the last year was to own
stocks with high market capitalizations and high, or infinite, P/E ratios. Small
cap, low P/E stocks generated the worst returns, while small cap, high P/E
stocks performed strongly. Specifically those companies with an infinite P/E
ratio appreciated 65%, on average. Technology, notably the Internet, and energy
and telecommunications stocks provided the greatest contribution to the Russell
2000 Index and Russell 2000 Value Index benchmark's fiscal year performance. The
stocks within these sectors, generally, carry high P/E multiples, and are
therefore not permissible for investment under the Small Cap Fund's investment
discipline. Additionally, the Small Cap Equity Fund attempts to invest in a
reasonably diversified (by industry) group of companies in order to reflect to
some degree the economy as a whole. That strategy, as such, was not successful
during the fiscal year 1999.

Small Cap Equity Fund
Comparison of Change in Value of $10,000 Investment*

Average Annual Total Returns for the
Periods Ended October 31, 1999
- -------------------------------------------------------------------------------

Since Final Value of a
1 Year Inception $10,000 Investment
------ --------- ------------------
Fund (4.29)% 2.01% $10,695
Russell
2000
Index 14.87% 7.29% 12,678

In the printed version there appears a line graph with
the following plot points depicted:

1838 Small Cap Russell
Equity Fund 2000 Index
-------------- ----------
17-Jun-96 10000 10000
Oct-96 9570 9680
Oct-97 13197 12519
Oct-98 11174 11037
Oct-99 10695 12678

* Past performance of the Fund is not predictive of future performance. The 1838
Small Cap Equity Fund commenced operations on June 17, 1996. The values shown
reflect a hypothetical initial investment of $10,000 with distributions
reinvested. Returns may be higher due to 1838 Investment Advisors, Inc.
maintenance of the Fund's expenses. Please bear in mind that investing in
small companies' stocks can involve higher risk and volatility than those of
larger companies. The Russell 2000 Index is an unmanaged stock market index
without any associated expenses and the return assumes reinvestment of all
dividends. You cannot invest directly in an index. Please read the prospectus
carefully before investing. Distributed by MBIA Capital Management
Corporation. See Financial Highlights on page 24.

7
<PAGE>

1838 SMALL CAP EQUITY FUND

- --------------------------------------------------------------------------------

Within the Fund's portfolio, the best performing stocks resided in the broad
consumer cyclical sector, and included Harrah's Entertainment, Ames Department
Stores, BJ's Wholesale Club, and Universal Electronics. The technology sector
also contributed positively, with the largest gains coming from AVX, Symantec,
Black Box, and Burr Brown. Brylane, The Learning Company, Holophane, Lone Star
Industries and World Color Press were acquired. The greatest negative impact
resided within the Financial Services, Basic Materials, and Health Care sectors.
Financial Services, and insurance companies in particular, underperformed due to
an uncharacteristically difficult property/casualty environment. Basic Materials
stocks, in spite of their inexpensive valuations, performed poorly in the face
of a potential economic slowdown which never occurred. Lastly, nursing home
stocks suffered as these companies struggled to operate within new proposed
payment guidelines. For the most part, these positions have been eliminated from
the Fund's portfolio, and replaced by others having more encouraging
fundamentals.

As of October 1999, the average P/E multiple of the stocks contained within the
Fund's portfolio was less than half that of the popular small cap benchmarks.
Additionally, these stocks displayed superior historical relative earnings
growth, ROE, and stronger balance sheets. We remain confident that the valuation
metrics and investment process of the 1838 Small Cap Equity Fund offers
compelling risk/reward characteristics for our shareholders.

<TABLE>
<CAPTION>
1838 Small Cap Russell 2000 Russell 2000 S&P 500
Equity Fund Index Value Index Index
-------------- ------------ ------------ -------
<S> <C> <C> <C> <C>
Portfolio P/E....................................... 12.8x 25.7x 17.5x 29.6x
EPS Growth 5 Years.................................. 21.6% 14.0% 10.9% 15.0%
Return on Equity*................................... 15.6% 11.8% 10.3% 23.3%
Debt/Capital........................................ 35.4% 38.4% 48.0% 44.4%
</TABLE>

* The number above represents the average return on equity for the
trailing twelve month period ending October 31, 1999.

Looking forward into the Fund's fiscal year 2000, the economy, now passing
beyond its one hundredth consecutive month of expansion, continues to look
solid. Buoyed by a confident consumer, contained inflationary pressures and
interest rates, productivity improvements driven by advances in technology and a
gradual improvement in international economies, we are comfortable with a real
GDP growth rate in the 3% area. Importantly, an improvement in business activity
on a worldwide basis should provide the impetus for stronger results in a wider
array of domestic companies that may have labored under intense pricing
pressures from foreign sources pricing more for survival than profitability.

The stock market's narrow focus has been the source of a high degree of
frustration for the 1838 Small Cap Equity team. Over the last ten years, our
investment discipline has provided patient long-term investors with strong
returns. We continue to adhere to our low P/E value investment process believing
that the market, over time, rewards those companies with sound fundamentals with
appropriate stock price appreciation.

Sincerely,

/s/ Edwin B. Powell
-----------------------------
Edwin B. Powell
Vice President & Portfolio Manager

8
<PAGE>
1838 SMALL CAP EQUITY FUND

SCHEDULE OF INVESTMENTS OCTOBER 31, 1999
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Value
Shares (Note 2)
--------- -----------
<S> <C> <C>
COMMON STOCK -- 93.91%

BASIC INDUSTRIES -- 13.13%
AptarGroup, Inc........................................................................ 29,000 $ 779,375
Building Materials Holding Corp.*...................................................... 36,915 408,372
D.R. Horton Inc........................................................................ 36,700 433,519
Engle Homes Inc........................................................................ 18,100 183,263
IVEX Packaging Corp.................................................................... 28,600 269,912
OM Group, Inc.......................................................................... 13,000 487,500
Quanex Corp............................................................................ 21,800 472,788
Southdown, Inc......................................................................... 11,100 536,269
Toll Brothers Inc.*.................................................................... 21,900 383,250
UCAR International Inc.*............................................................... 25,900 506,669
US Can Corp.*.......................................................................... 26,365 514,118
Velcro Inds. NV........................................................................ 43,000 542,875
-----------
5,517,910
-----------

CAPITAL GOODS -- 0.95%
Alliant Techsystems Inc................................................................ 6,500 399,750
-----------

CONSUMER CYCLICAL -- 21.49%
American Woodmark Corp................................................................. 13,400 298,150
BJ's Wholesale Club Inc................................................................ 14,900 459,106
Furniture Brands International Inc.*................................................... 42,400 821,500
Harrah's Entertainment, Inc.*.......................................................... 35,500 1,027,281
Interim Services Inc.*................................................................. 25,400 417,513
Mandalay Resort Group*................................................................. 38,600 718,925
Mohawk Industries*..................................................................... 22,400 513,800
R.H. Donnelley Corp.................................................................... 25,800 486,975
Sun International Hotels Ltd.*......................................................... 15,400 311,850
Tropical Sportswear International Corp.*............................................... 32,600 647,925
Unifi, Inc.*........................................................................... 58,500 702,000
United Stationers, Inc.*............................................................... 18,900 481,950
Westpoint Stevens, Inc................................................................. 28,300 535,931
Wolverine World Wide, Inc.............................................................. 48,100 493,025
Zale Corp.*............................................................................ 26,675 1,117,016
-----------
9,032,947
-----------
</TABLE>

See notes to financial statements.

9
<PAGE>
1838 SMALL CAP EQUITY FUND

ENERGY -- 4.26%
Oceaneering International*............................................................. 29,900 405,519
Seacor Smit Inc.*...................................................................... 13,200 603,900
Tidewater Inc.......................................................................... 26,100 783,000
-----------
1,792,419
-----------

FINANCIAL -- 24.53%
Allmerica Financial Corp............................................................... 8,200 468,938
Amcore Financial, Inc.................................................................. 8,200 193,725
Brandywine Realty Trust................................................................ 16,500 277,406
Chelsea GCA Realty, Inc................................................................ 15,200 471,200
Chittenden Corp........................................................................ 21,000 648,375
Colonial Bancgroup Inc................................................................. 79,900 953,806
Cullen/Frost Bankers, Inc.............................................................. 25,600 739,200
Dime Community Bancshares.............................................................. 26,300 530,931
Everest Reinsurance Holdings........................................................... 24,725 636,669
FPIC Insurance Group, Inc.*............................................................ 10,700 169,862
Heller Financial, Inc.................................................................. 29,900 710,125
Hudson United Bancorp.................................................................. 30,500 958,844
LaSalle Re Holdings Ltd................................................................ 22,300 288,506
Pacific Gulf Properties, Inc........................................................... 16,600 336,150
Penn Treaty American Corp.*............................................................ 15,700 282,600
Peoples Heritage Financial Group....................................................... 46,200 877,800
Reinsurance Group of America........................................................... 29,700 987,525
Riggs National Corp.................................................................... 24,255 366,857
State Auto Financial Corp.............................................................. 27,100 311,650
United Security Bancorp................................................................ 7,319 102,467
-----------
10,312,636
-----------

HEALTHCARE -- 6.13%
Amerisource Health (A shares).......................................................... 27,800 $ 417,000
Apria Healthcare Group Inc............................................................. 44,900 709,981
Del Global Technologies Corp.*......................................................... 40,300 332,475
Trigon Healthcare, Inc.*............................................................... 16,300 462,513
Varian Medical Systems, Inc.*.......................................................... 31,100 655,044
-----------
2,577,013
-----------
</TABLE>

See notes to financial statements.

10
<PAGE>

1838 SMALL CAP EQUITY FUND

SCHEDULE OF INVESTMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Value
Shares (Note 2)
--------- -----------
TECHNOLOGY -- 11.46%
<S> <C> <C>
AVX Corp............................................................................... 28,700 $ 1,148,000
Autodesk, Inc.......................................................................... 18,600 348,750
Benchmark Electronics.................................................................. 22,300 356,800
Black Box Corp.*....................................................................... 10,300 522,725
Burr-Brown Corp.*...................................................................... 14,018 551,083
Ciber Inc.*............................................................................ 26,300 429,019
Oak Industries Inc.*................................................................... 7,590 311,190
Sterling Software, Inc.*............................................................... 32,500 712,967
Symantec Corp.*........................................................................ 9,200 439,300
-----------
4,819,834
-----------

TRANSPORTATION -- 4.95%
America West Holdings Corp.*........................................................... 31,200 645,450
Indigo Aviation AB*.................................................................... 25,500 179,297
Rollins Truck Leasing Corp............................................................. 62,150 598,194
Sea Containers Ltd..................................................................... 22,500 658,125
-----------
2,081,066
-----------
TOTAL COMMON STOCKS (Cost $41,577,150)............................................... 39,482,819

SHORT-TERM INVESTMENT -- 4.70%
SEI Daily Income Trust Prime Obligation (Cost $1,976,664).............................. 1,976,664 1,976,664
-----------

TOTAL INVESTMENTS (Cost $43,553,814)+ -- 98.61%............................................ $41,459,483

OTHER ASSETS AND LIABILITIES, NET -- 1.39%................................................. 586,343
-----------

NET ASSETS -- 100%......................................................................... $42,045,826
===========
</TABLE>

* Non-income producing security.

+ The cost for federal income tax purposes was $43,644,050. At October 31, 1999,
net unrealized depreciation was $2,184,567. This consisted of aggregate gross
unrealized appreciation for all securities for which there was an excess of
market value over tax cost of $3,862,439, and aggregate gross unrealized
depreciation for all securities for which there was an excess of tax cost over
market value of $6,047,006.

See notes to financial statements.

11
<PAGE>

1838 FIXED INCOME FUND

- --------------------------------------------------------------------------------

TO THE SHAREHOLDER:

"Through the looking glass" is a theme reflecting activity in the fixed income
markets during 1999. In 1998, fears over Asian contagion led to a flight to
quality in treasury securities and away from the "spread sectors" (corporate,
mortgage and asset backed bonds). In 1999, contagion fears subsided and more
flowed back to spread sectors. In 1998, the Fed eased rates and the 30 year U.S.
Treasury rallied to an historic low of 4.75%. In 1999, the Fed began tightening
rates propelling the same U.S. Treasury yield north of 6%. The impact of higher
yields has caused total returns to suffer as price decreases offset the benefits
of coupon inflows. On the positive side, our analysis indicates that rates are
not likely to spike much further. Despite the challenge of higher rates, the
Fund outperformed the Lehman Aggregate Bond Index (the "Lehman Aggregate Index")
by 26 basis points, with a total return of 0.79% for fiscal year 1999. The
outperformance resulted from our asset allocation over-weighting in corporate
bonds, which bested other sectors in return. We were also able to take advantage
of an active new issue calendar of cheap offerings.

Going forward, we expect the economy to continue on its stable growth path with
inflation remaining within acceptable ranges. In this scenario, spread product
should continue to outperform U.S. Treasuries and we expect to maintain our
overweight to advantage this view.

The Fund's exposures compared to the Lehman Aggregate Index at October 31,1999
were as follows:
<TABLE>
<CAPTION>
1838
Fixed Lehman
Income Aggregate
Fund Index
--------- -----------
<S> <C> <C>
Corporate Bonds....................................................... 30% 20%
Mortgage-Backed....................................................... 34% 34%
Asset-Backed.......................................................... 6% 3%
Agencies.............................................................. 11% 8%
Treasuries............................................................ 17% 35%
</TABLE>

The total return for the 1838 Fixed Income Fund for the fiscal year ended
October 31, 1999, was 0.79% versus 0.53% for the Lehman Aggregate Index.
Inception-to-date (September 1997 through October 1999, annualized), the Fund
returned 4.51% versus the Lehman Aggregate Index at 5.89%.

12
<PAGE>

1838 FIXED INCOME FUND

- --------------------------------------------------------------------------------

Fixed Income Fund
Comparison of Change in Value of $10,000 Investment*

Average Annual Total Returns
for the Periods Ended
October 31, 1999
- --------------------------------------------------------------------------------

Since Final Value of a
1 Year Inception $10,000 Investment
------ --------- ------------------
Fund 0.79% 4.51% $10,999

Lehman
Aggregate
Bond Index 0.53% 5.89% 11,316

In the printed version there appears a line graph with
the following plot points depicted:

1838 Fixed Fund Lehman Aggregate
--------------- ----------------
2-Sept-97 10000 10000
Oct-97 10270 10295
Oct-98 10913 11257
Oct-99 10999 11316

* Past performance of the Fund is not predictive of future performance. The 1838
Fixed Income Fund commenced operations on September 2, 1997. The values shown
reflect a hypothetical initial investment of $10,000 with distributions
reinvested. Returns may be higher due to 1838 Investment Advisors, Inc.
maintenance of the Fund's expenses. The Lehman Aggregate Index is an unmanaged
index which consists of more than 14,750 bond issues spread over the
investment grade bond universe and does not have any associated expenses and
the returns assume reinvestment of all interest income. You cannot invest in
an index. Please read the prospectus carefully before investing. Distributed
by MBIA Capital Management Corporation. See Financial Highlights on page 25.

Sincerely,

/s/ Clifford D. Corso
---------------------------
Clifford D. Corso
Vice President & Portfolio Manager

13
<PAGE>

1838 FIXED INCOME FUND

SCHEDULE OF INVESTMENTS OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>

Moody's/S&P Principal Value
Rating Amount (Note 2)
----------- ----------- ----------
<S> <C> <C> <C>
CORPORATE BONDS -- 29.92%
FINANCIAL -- 19.30%
Abbey National PLC, 7.95%, 10/26/29 .................................... Aa3/AA- $1,400,000 $ 1,428,928
Associates Corp. of N.A., 6.50%, 10/15/02 .............................. Aa3/AA- 1,800,000 1,788,611
General Motors Acceptance Corp., 5.35%, 12/07/01 ....................... A2/A 2,800,000 2,730,832
Goldman Sachs Group Inc., 6.65%, 05/15/09 .............................. A1/A+ 1,755,000 1,669,609
Ford Motor Credit Corp., 7.20%, 06/15/07 ............................... A1/A 1,150,000 1,150,647
Norwest Financial Inc., 7.875%, 02/15/02 ............................... Aa3/A+ 1,400,000 1,431,942
Paine Webber Group, 5.83%, 01/25/01 .................................... Baa1/BBB+ 3,000,000 2,960,463
PNC Funding Corp., 6.125%, 09/01/03 .................................... A3/BBB+ 1,300,000 1,262,461
Suntrust Banks Inc., 6.00%, 02/15/26 ................................... A2/A 1,500,000 1,409,883
U.S. Bancorp., 8.09%, 11/15/26 ......................................... A1/BBB+ 600,000 588,942
Westdeutsche Landesbank NY, 6.05%, 01/15/09 ............................ Aa1/AA+ 1,930,000 1,764,786
-----------
18,187,104
-----------
INDUSTRIAL & MISCELLANEOUS -- 3.19%
Rohm & Haas Co., 7.85%, 07/15/29, 144A* ................................ A3/A- 1,230,000 1,257,053
Safeway Inc., 7.50%, 09/15/09 .......................................... Baa2/BBB 1,740,000 1,745,986
-----------
3,003,039
-----------
UTILITIES -- 7.43%
AT&T Corporation, 6.50%, 09/15/02 ...................................... A1/AA- 1,600,000 1,593,971
Edison International Inc., 6.875%, 09/15/04 ............................ A2/A- 1,800,000 1,785,190
Sprint Capital Corp., 6.875%, 11/15/28 ................................. Baa1/BBB+ 1,830,000 1,674,368
WorldCom, Inc., 6.40%, 08/15/05 ........................................ A3/A- 2,000,000 1,943,048
-----------
6,996,577
-----------
TOTAL CORPORATE BONDS (Cost $28,578,066) .......................................................... 28,186,720
-----------
ASSET BACKED SECURITIES -- 5.59%
Bear Stearns CMS, Ser. 1999-WF2, Cl. A2, 7.08%, 06/15/09 ............... Aaa/AAA 1,850,000 1,844,838
Citibank Credit Card Master Trust, Ser. 1999-2 Cl. A, 5.875%,
03/10/11 ............................................................. Aaa/AAA 2,410,000 2,242,746
Comed Transitional Funding Trust, Ser. 1998-1 Cl. A2, 5.29%,
06/25/03 ............................................................. Aaa/AAA 1,200,000 1,181,976
-----------
TOTAL ASSET BACKED SECURITIES (Cost $5,456,147) ................................................... 5,269,560
-----------
MORTGAGE BACKED SECURITIES -- 33.54%
FGLMC, Pool #C30260, 7.50%, 08/01/29 ................................... Aaa/AAA 1,292,534 1,298,161
FHLMC, Pool #G10557, 6.50%, 07/01/11 ................................... Aaa/AAA 1,682,137 1,656,385
FHLMC, Ser. T-8, Cl. A6, 7.00%, 01/15/19 ............................... Aaa/AAA 1,000,000 995,170
FHLMC, Pool #C80342, 6.50%, 09/01/25 ................................... Aaa/AAA 1,180,544 1,139,603
FNMA, Pool #250890, 7.00%, 04/01/04 .................................... Aaa/AAA 1,115,196 1,117,096
FNMA, Pool #303728, 6.00%, 01/01/11 .................................... Aaa/AAA 1,521,980 1,471,433
FNMA, Pool #190275, 8.00%, 11/01/26 .................................... Aaa/AAA 1,787,755 1,822,686
FNMA, Pool #481429, 6.00%, 01/01/29 .................................... Aaa/AAA 1,979,391 1,846,021
FNMA, Pool #487830, 6.00%, 03/01/29 .................................... Aaa/AAA 3,664,698 3,416,301
FNMA, Pool #TBA, 7.50%, 11/01/29 ....................................... Aaa/AAA 4,500,000 4,467,656
</TABLE>

See notes to financial statements.
14

<PAGE>

1838 FIXED INCOME FUND

SCHEDULE OF INVESTMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Moody's/S&P Principal Value
Rating Amount (Note 2)
----------- ---------- -----------
<S> <C> <C> <C>
MORTGAGE BACKED SECURITIES (CONTINUED)
GNMA, Pool #780374, 7.50%, 12/15/23..................................... Aaa/AAA $1,009,316 $ 1,015,860
GNMA, Pool #2038, 8.50%, 07/20/25....................................... Aaa/AAA 115,214 119,634
GNMA, Pool #417239, 7.00%, 02/15/26..................................... Aaa/AAA 1,917,345 1,882,167
GNMA, Pool #443623, 6.50%, 02/15/28..................................... Aaa/AAA 1,981,526 1,894,503
GNMA, Pool #462556, 6.50%, 02/15/28..................................... Aaa/AAA 2,709,299 2,591,125
GNMA, Pool #448178, 6.50%, 03/15/28..................................... Aaa/AAA 194,388 185,909
GNMA, Pool #491223, 7.00%, 03/15/29..................................... Aaa/AAA 3,038,061 2,980,939
GNMA, Pool #509609, 7.00%, 07/15/29..................................... Aaa/AAA 1,735,480 1,702,849
-----------
TOTAL MORTGAGE BACKED SECURITIES (Cost $32,278,369)................................................ 31,603,498
-----------
TAXABLE MUNICIPAL BOND -- 1.81%
Alameda, CA Corridor Trans. Auth. (MBIA), 6.60% 10/01/29
(Cost $1,894,941)..................................................... Aaa/AAA 1,900,000 1,703,219
-----------
U.S. GOVERNMENT AGENCY OBLIGATIONS** -- 11.04%
FFCB, 6.22%, 10/12/04................................................................. 1,500,000 1,481,794
FHLB, 6.30%, 06/03/09................................................................. 1,250,000 1,212,506
FHLMC, 6.25%, 10/15/02................................................................ 4,000,000 3,995,280
FHLMC, 6.30%, 06/01/04................................................................ 1,560,000 1,529,661
FHLMC, 6.45%, 04/29/09................................................................ 2,300,000 2,186,944
-----------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $10,532,374)........................................ 10,406,185
-----------
U.S. TREASURY OBLIGATIONS** -- 16.52%
U.S. Treasury Note, 6.25%, 08/31/02................................................... 100,000 100,906
U.S. Treasury Note, 5.50%, 07/31/01................................................... 3,200,000 3,183,002
U.S. Treasury Note, 6.00%, 08/15/04................................................... 3,500,000 3,507,658
U.S. Treasury Note, 6.00%, 08/15/09................................................... 5,930,000 5,922,587
U.S. Treasury Bond, 5.25%, 02/15/29................................................... 3,290,000 2,845,850
-----------
TOTAL U.S. TREASURY OBLIGATIONS (Cost $15,480,372)................................................. 15,560,003
-----------
<CAPTION>
Shares
----------
<S> <C> <C>
SHORT-TERM INVESTMENT -- 0.28%
SEI Daily Income Trust Prime Obligation (Cost $266,968)............................... 266,968 266,968
-----------
TOTAL INVESTMENTS (Cost $94,487,237)+ -- 98.70%.......................................................... 92,996,153
OTHER ASSETS AND LIABILITIES, NET -- 1.30%............................................................... 1,224,573
-----------
NET ASSETS -- 100%....................................................................................... $94,220,726
===========
</TABLE>

* Resale restricted to institutional buyers.

** While no ratings are shown for U.S. Government Agency Obligations and U.S.
Treasury Obligations, they are considered to be of the highest quality,
comparable to Moody's AAA rating and S&P's Aaa rating.

+ The cost for federal income tax purposes was $94,539,652. At October 31,
1999, net unrealized depreciation was $1,543,499. This consisted of aggregate
gross unrealized appreciation for all securities for which there was an
excess of market value over tax cost of $268,491, and aggregate gross
unrealized depreciation for all securities for which there was an excess of
tax cost over market value of $1,811,990.

TBA -- Securities purchased on a forward commitment basis with an approximate
principal amount and no definitive maturity date. The actual principal
and maturity date will be determined upon settlement.

See notes to financial statements.
15
<PAGE>

1838 LARGE CAP EQUITY FUND

- --------------------------------------------------------------------------------

TO THE SHAREHOLDER:

The management of the 1838 Large Cap Equity Fund (the "Fund") is pleased to
report the commencement of operations of the Fund and the activity for the
period ended October 31, 1999.

PERFORMANCE REVIEW

The Fund commenced operations on September 29, 1999 with an initial net asset
value ("NAV") of $10.00 per share. The NAV increased to $10.61 as of October 31,
1999 which made the total return for the Fund since inception 6.10%. During the
same period, the benchmark for the Fund, the Standard & Poor's 500 Index* ("S&P
500") had a total return of 7.65%. Although the Fund lagged behind the S&P 500
by 1.55% for the period ending October 31, 1999, by November 17, 1999 the Fund's
total return had surpassed the S&P 500 by 0.52%. As of November 17, 1999, the
Fund's NAV had risen to $11.20, which represented a total return since inception
of 12.00% versus the S&P 500's total return for the same period of 11.48%.

The preceding performance discussion covers a very short period of time but the
investment philosophy implemented by 1838 Investment Advisors, Inc., the Fund's
advisor, has been tested over many years. The Fund's current prospectus contains
the historical performance of a composite of segregated accounts that were
managed with substantially similar objectives, policies and strategies as those
of the Fund. We believe that historical performance stated in the prospectus
demonstrates that the adviser has been able to consistently stay ahead of the
S&P 500.

INVESTMENT STRATEGY AND ECONOMIC OUTLOOK

This year has marked a continuation of the multiyear trend favoring technology
stocks, as the sector produced a 33.7% return versus 12.1% for the S&P 500
year-to-date through October. One cannot escape the news surrounding internet
stocks, initial public offerings (IPO's), along with reports of significant
technology breakthroughs which will enhance our lifestyle and economy. The pace
has been torrid!

1838's Large Cap Equity Fund adheres to a policy which keeps the portfolio
invested in each of the economic sectors at approximately an S&P 500 weight,
and, needless to say, the product has benefited from its exposure to technology.
More importantly, we focus our efforts on superior stock selection in each
sector, rather than trying to guess which area will be the next big winner (or
loser.) Our focus in technology is on having investments in leading companies
across the spectrum of productivity, while minimizing our exposure to the risks
in one single product. We are careful to diversify the Fund's holdings and keep
position sizes constrained such that they can add meaningfully to performance,
but are not so large as to damage the returns in the event of a serious
dislocation.

* The S&P 500 Index is an unmanaged, capitalization-weighted index of five
hundred publicly traded stocks without any associated expenses and the returns
assume reinvestment of all dividends.

16
<PAGE>

1838 LARGE CAP EQUITY FUND

- --------------------------------------------------------------------------------

We look forward to providing our investors with updates describing market
conditions and analysis, on which sectors and stocks are adding to performance,
and those, which are not.

We invite your questions and comments and thank you for your investment in the
Fund. We look forward to reviewing our investment outlook and strategy with you
in our next report to shareholders.

Sincerely,

/s/ George W. Gephart, Jr.
---------------------------------
George W. Gephart, Jr.
Vice President & Portfolio Manager

17
<PAGE>

1838 LARGE CAP EQUITY FUND

SCHEDULE OF INVESTMENTS OCTOBER 31, 1999
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Value
Shares (Note 2)
------ ----------
<S> <C> <C>
COMMON STOCK -- 97.44%

BASIC INDUSTRIES -- 10.98%
Avery Dennison Corp........................................................................ 1,600 $ 100,000
E. I. Dupont de Nemours & Co............................................................... 1,200 77,325
General Electric Co........................................................................ 1,300 176,231
Illinois Tool Works........................................................................ 1,300 95,225
Tyco International Ltd..................................................................... 2,300 91,856
----------
540,637
----------

CONSUMER CYCLICAL -- 12.36%
Carnival Corp.............................................................................. 2,000 89,000
Ford Motor Co.............................................................................. 1,900 104,262
Interpublic Group of Cos................................................................... 2,200 89,375
McDonalds Corp............................................................................. 2,200 90,750
Staples Inc.*.............................................................................. 5,700 126,469
Wal-Mart Stores Inc........................................................................ 1,900 108,537
----------
608,393
----------

CONSUMER STAPLES -- 7.41%
Anheuser-Busch Cos., Inc................................................................... 1,000 71,813
Estee Lauder Cos........................................................................... 2,300 107,238
Proctor & Gamble Co........................................................................ 1,200 125,850
Safeway Inc.*.............................................................................. 1,700 60,031
----------
364,932
----------

ENERGY -- 6.87%
Chevron Corp............................................................................... 1,000 91,312
Mobil Corp................................................................................. 1,500 144,750
Schlumberger Ltd........................................................................... 1,100 66,619
Transocean Offshore, Inc................................................................... 1,300 35,344
----------
338,025
----------

FINANCIAL -- 14.98%
American International Group............................................................... 2,000 205,875
Associates First Capital Corp.............................................................. 2,700 98,550
Citigroup Inc.............................................................................. 3,000 162,375
Fifth Third Bancorp........................................................................ 1,400 103,337
Wells Fargo Co............................................................................. 3,500 167,563
----------
737,700
----------
</TABLE>

See notes to financial statements.
18
<PAGE>

1838 LARGE CAP EQUITY FUND

SCHEDULE OF INVESTMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Value
Shares (Note 2)
HEALTHCARE -- 8.31% ------ ----------
<S> <C> <C>
Medtronic Inc.............................................................................. 3,900 $ 135,037
Merck & Co., Inc........................................................................... 1,300 103,431
Pharmacia & Upjohn Inc..................................................................... 1,600 86,300
Schering-Plough Corp....................................................................... 1,700 84,150
----------
408,918
----------

TECHNOLOGY -- 24.40%
America Online*............................................................................ 700 90,781
Applied Materials*......................................................................... 900 80,831
Cisco Systems*............................................................................. 2,600 192,400
Dell Computer*............................................................................. 2,400 96,300
EMC Corp.*................................................................................. 1,600 116,800
Intel Corp................................................................................. 1,900 147,131
Microsoft*................................................................................. 2,300 212,894
Oracle Corp.*.............................................................................. 1,600 76,100
Sun Microsystems Inc.*..................................................................... 1,100 116,394
Texas Instruments Inc...................................................................... 800 71,800
----------
1,201,431
----------

TELECOMMUNICATIONS -- 12.13%
Bell Atlantic Corp......................................................................... 1,400 90,912
MCI Worldcom Inc.*......................................................................... 2,200 188,788
SBC Communications......................................................................... 3,900 198,658
Sprint Corp................................................................................ 1,600 118,900
----------
597,258
----------
TOTAL COMMON STOCKS (Cost $4,553,443).......................................................... 4,797,294
SHORT-TERM INVESTMENT -- 1.09%
SEI Daily Income Trust Prime Obligation (Cost $53,707)..................................... 53,707 53,707
----------
TOTAL INVESTMENTS (Cost $4,607,150)+ -- 98.53%................................................. $4,851,001
OTHER ASSETS AND LIABILITIES, NET -- 1.47%..................................................... 72,294
----------
NET ASSETS -- 100%............................................................................. $4,923,295
==========
</TABLE>

* Non-income producing security.

+ The cost for federal income tax purposes was $4,607,150. At October 31, 1999,
net unrealized appreciation was $243,851. This consisted of aggregate gross
unrealized appreciation for all securities for which there was an excess of
market value over tax cost of $295,356, and aggregate gross unrealized
depreciation for all securities for which there was an excess of tax cost over
market value of $51,505.

See notes to financial statements.
19
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

STATEMENTS OF ASSETS AND LIABILITIES OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
International Small Cap Fixed Income Large Cap
Equity Fund Equity Fund Fund Equity Fund
<S> <C> <C> <C> <C>
-----------------------------------------------------------
ASSETS:
Investments, at value (identified cost $66,962,031,
$43,553,814, $94,487,237 and $4,607,150, respectively)
(Note 2).................................................. $86,164,545 $41,459,483 $ 92,996,153 $4,851,001
Receivables:
Dividends and interest.................................... 103,124 27,058 905,206 3,377
Investment securities sold................................ 3,693,331 1,376,620 9,752,108 70,180
Reimbursement due from advisor............................ -- -- -- 8,759
Other assets................................................ 20,302 996 617 --
-----------------------------------------------------------
Total assets.......................................... 89,981,302 42,864,157 103,654,084 4,933,317
-----------------------------------------------------------
LIABILITIES:
Management fees due to adviser (Note 4)..................... 53,850 26,953 6,136 --
Due to affiliates (Note 4).................................. 14,645 8,367 12,654 6,466
Payable for investment securities purchased................. 3,314,283 752,631 9,374,705 --
Other accrued expenses...................................... 51,498 30,380 39,863 3,556
-----------------------------------------------------------
Total liabilities..................................... 3,434,276 818,331 9,433,358 10,022
-----------------------------------------------------------
NET ASSETS.................................................. $86,547,026 $42,045,826 $ 94,220,726 $4,923,295
===========================================================
NET ASSETS CONSIST OF:
Par value of shares of beneficial interest (par $0.001)..... $ 5,939 $ 4,281 $ 9,605 $ 464
Additional capital paid-in.................................. 62,667,820 47,894,070 97,146,404 4,660,462
Undistributed net investment income......................... 7,585 -- 220,204 3,799
Accumulated realized gain (loss) on investments............. 4,661,312 (3,758,194) (1,664,403) 14,719
Net unrealized appreciation (depreciation) on:
Investments............................................... 19,202,514 (2,094,331) (1,491,084) 243,851
Translation of assets and liabilities in foreign
currencies.............................................. 1,856 -- -- --
-----------------------------------------------------------
NET ASSETS.................................................. $86,547,026 $42,045,826 $ 94,220,726 $4,923,295
===========================================================
Shares of beneficial interest outstanding................... 5,938,529 4,280,597 9,604,582 463,944
-----------------------------------------------------------
NET ASSET VALUE, offering and redemption price per share
(Net assets/Outstanding shares of beneficial interest).... $ 14.57 $ 9.82 $ 9.81 $ 10.61
===========================================================
</TABLE>

See notes to financial statements.

20
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

STATEMENTS OF OPERATIONS FOR THE PERIOD ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
International Small Cap Fixed Income Large Cap
Equity Fund Equity Fund Fund Equity Fund+
<S> <C> <C> <C> <C>
-------------------------------------------------------------
INVESTMENT INCOME:
Dividends.................................................. $ 1,065,713 $ 374,403 -- $ 2,232
Interest................................................... 105,409 69,186 $5,016,642 3,390
Foreign taxes withheld..................................... (191,725) -- -- --
-------------------------------------------------------------
Total Investment Income................................ 979,397 443,589 5,016,642 5,622
-------------------------------------------------------------
EXPENSES:
Investment advisory fees (Note 4).......................... 554,632 352,199 418,704 1,580
Administration fee (Note 4)................................ 41,285 21,322 37,358 1,315
Accounting fee (Note 4).................................... 30,220 20,225 21,982 3,507
Custodian fees............................................. 47,663 10,433 9,318 500
Transfer agency fees....................................... 12,666 12,666 12,666 1,808
Trustees' fees (Note 4).................................... 13,098 8,188 14,613 300
Audit and tax fees......................................... 17,693 12,635 12,657 1,238
Legal fees................................................. 23,259 21,086 26,877 500
Registration fees.......................................... 19,140 17,590 26,072 778
Reports to shareholders.................................... 14,990 9,431 15,728 418
Amortization of organizational costs (Note 2).............. 25,853 -- -- --
Other...................................................... 8,940 3,773 17,616 218
-------------------------------------------------------------
Total expenses......................................... 809,439 489,548 613,591 12,162
Advisory fees waived (Note 4)........................ -- -- (99,887) (1,580)
Reimbursement from adviser (Note 4).................. -- -- -- (8,759)
-------------------------------------------------------------
Total expenses, net............................... 809,439 489,547 513,704 1,823
-------------------------------------------------------------
Net investment income (loss)............................. 169,958 (45,959) 4,502,938 3,799
-------------------------------------------------------------

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCY:
Net realized gain (loss) from:
Investment transactions................................ 4,664,281 (3,154,069) (1,593,120) 14,719
Foreign currency transactions.......................... (168,139) -- -- --
-------------------------------------------------------------
Total net realized gain (loss)......................... 4,496,142 (3,154,069) (1,593,120) 14,719
-------------------------------------------------------------
Change in unrealized appreciation (depreciation) of:
Investments............................................ 13,869,059 797,122 (2,308,516) 243,851
Translation of assets and liabilities in foreign
currencies........................................... (2,205) -- -- --
-------------------------------------------------------------
Total change in unrealized appreciation
(depreciation)....................................... 13,866,854 797,122 (2,308,516) 243,851
-------------------------------------------------------------
Net gain (loss) on investments and foreign currency.... 18,362,996 (2,356,947) (3,901,636) 258,570
-------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................... $18,532,954 $(2,402,906) $ 601,302 $ 262,369
=============================================================
</TABLE>

+ The Large Cap Equity Fund commenced operations on September 29, 1999.

See notes to financial statements.

21
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
International Small Cap Fixed Income Large Cap
Equity Fund Equity Fund Fund Equity Fund+
<S> <C> <C> <C> <C>
------------------------------------------------------------
FOR THE PERIOD ENDED OCTOBER 31, 1999
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)............................. $ 169,958 $ (45,959) $ 4,502,938 $ 3,799
Net realized gain (loss) from investment and foreign
currency transactions.................................. 4,496,142 (3,154,069) (1,593,120) 14,719
Change in unrealized appreciation (depreciation) of
investments and foreign currency....................... 13,866,854 797,122 (2,308,516) 243,851
------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations............................................... 18,532,954 (2,402,906) 601,302 262,369
------------------------------------------------------------
Distributions to shareholders:
Net investment income.................................... -- -- (4,282,734) --
Net realized gains....................................... (4,289,722) -- -- --
------------------------------------------------------------
Total distributions.................................... (4,289,722) -- (4,282,734) --
------------------------------------------------------------
Increase in net assets from Fund share transactions (Note
5)....................................................... 14,428,889 5,815,832 26,178,864 4,660,926
------------------------------------------------------------
Increase in net assets..................................... 28,672,121 3,412,926 22,497,432 4,923,295

NET ASSETS:
Beginning of period...................................... 57,874,905 38,632,900 71,723,294 --
------------------------------------------------------------
End of period............................................ $86,547,026 $42,045,826 $ 94,220,726 4,923,295
============================================================
FOR THE YEAR ENDED OCTOBER 31, 1998
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)............................. $ 55,124 $ (48,758) $ 3,187,767
Net realized gain (loss) from investment and foreign
currency transactions.................................. 3,215,802 (684,440) (71,283)
Change in unrealized appreciation (depreciation) of
investments and foreign currency....................... 371,928 (6,586,969) 526,819
--------------------------------------------
Net increase (decrease) in net assets resulting from
operations............................................... 3,642,854 (7,320,167) 3,643,303
--------------------------------------------
Distributions to shareholders:
Net investment income.................................... (17,086) -- (3,369,397)
Return of capital........................................ -- -- (236,732)
Net realized gains....................................... (2,857,635) (2,137,768) (92,049)
--------------------------------------------
Total distributions.................................... (2,874,721) (2,137,768) (3,698,178)
--------------------------------------------
Increase in net assets from Fund share transactions (Note
5)....................................................... 6,061,174 19,168,298 39,241,000
--------------------------------------------
Increase in net assets..................................... 6,829,307 9,710,363 39,186,125

NET ASSETS:
Beginning of year........................................ 51,045,598 28,922,537 32,537,169
--------------------------------------------
End of year.............................................. $57,874,905 $38,632,900 $ 71,723,294
============================================
</TABLE>

+ The Large Cap Equity Fund commenced operations on September 29, 1999.

See notes to the financial statements.

22
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

The following table includes selected data for a share outstanding throughout
each fiscal year or period and other performance information derived from the
financial statements. It should be read in conjunction with the financial
statements and notes thereto.

INTERNATIONAL EQUITY FUND

<TABLE>
<CAPTION>
For the Fiscal Year or Period Ended October 31,
-----------------------------------------------------------------------------
1999 1998 1997 1996 1995+
<S> <C> <C> <C> <C> <C> <C>
-----------------------------------------------------------------------------
NET ASSET VALUE -- BEGINNING OF YEAR......... $ 12.08 $ 11.99 $ 10.44 $ 9.61 $ 10.00
-----------------------------------------------------------------------------
INVESTMENT OPERATIONS:
Net investment income...................... 0.03 0.01 0.02 0.07 0.02
Net realized and unrealized gain (loss) on
investments and foreign currency
transactions............................. 3.34 0.75 1.57 0.80 (0.41)
-----------------------------------------------------------------------------
Total from investment operations....... 3.37 0.76 1.59 0.87 (0.39)
-----------------------------------------------------------------------------
DISTRIBUTIONS:
From net investment income................. -- -- (0.04) (0.04) --
From net realized gain on investments...... (0.88) (0.67) -- -- --
-----------------------------------------------------------------------------
Total distributions.................... (0.88) (0.67) (0.04) (0.04) --
-----------------------------------------------------------------------------
NET ASSET VALUE -- END OF YEAR............... $ 14.57 $ 12.08 $ 11.99 $ 10.44 $ 9.61
=============================================================================
TOTAL RETURN................................. 29.10% 6.90% 15.23% 9.11% (3.90)%**

Ratios (to average net assets)/Supplemental
Data:
Expenses (net of fee waivers)............ 1.09% 1.13% 1.25% 1.25% 1.25%*
Expenses (excluding fee waivers)......... N/A N/A 1.44% 1.80% 2.60%*
Net investment income.................... 0.23% 0.10% 0.28% 0.70% 1.02%*
Portfolio turnover rate...................... 48.71% 166.77% 92.33% 59.11% 42.21%*
Net assets, end of period (in 000's)......... $ 86,547 $ 57,875 $ 51,046 $ 41,209 $16,764
</TABLE>

<TABLE>
<S> <C>
+ The International Equity Fund commenced operations on August 3, 1995.
* Annualized.
** Total return not annualized.
</TABLE>

See notes to financial statements.

23
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

SMALL CAP EQUITY FUND
<TABLE>
<CAPTION>
For the Fiscal Year or Period Ended October 31,
---------------------------------------------------------------------------
1999 1998 1997 1996+
<S> <C> <C> <C> <C>
---------------------------------------------------------------------------
NET ASSET VALUE - BEGINNING OF YEAR.............. $ 10.26 $ 13.08 $ 9.57 $ 10.00
---------------------------------------------------------------------------
INVESTMENT OPERATIONS:
Net investment loss............................ (0.01) (0.01) (0.02) (0.02)
Net realized and unrealized gain (loss) on
investments and foreign currency
transactions................................. (0.43) (1.86) 3.62 (0.41)
---------------------------------------------------------------------------
Total from investment operations........... (0.44) (1.87) 3.60 (0.43)
---------------------------------------------------------------------------
Distributions:
From net investment income..................... -- -- -- --
From net realized gain on investments.......... -- (0.95) (0.09) --
---------------------------------------------------------------------------
Total distributions........................ -- (0.95) (0.09) --
---------------------------------------------------------------------------
NET ASSET VALUE - END OF YEAR.................... $ 9.82 $ 10.26 $ 13.08 $ 9.57
===========================================================================
TOTAL RETURN..................................... (4.29)% (15.33)% 37.81% (4.30)%**
Ratios (to average net assets)/Supplemental Data:
Expenses (net of fee waivers)................ 1.04% 1.10% 1.25% 1.25%*
Expenses (excluding fee waivers)............. N/A N/A 1.84% 4.63%*
Net investment income........................ (0.10)% (0.13)% (0.27)% (0.52)%*
Portfolio turnover rate.......................... 91.33% 42.64% 67.66% 94.38%*
Net assets, end of period (in 000's)............. $ 42,046 $ 38,633 $ 28,923 $ 5,428
</TABLE>

<TABLE>
<S> <C>
+ The Small Cap Equity Fund commenced operations on June 17, 1996.
* Annualized.
** Total return not annualized.
</TABLE>

See notes to financial statements.

<PAGE>

1838 INVESTMENT ADVISORS FUNDS

FINANCIAL HIGHLIGHTS -- CONTINUED
- --------------------------------------------------------------------------------

FIXED INCOME FUND

<TABLE>
<CAPTION>
For the Fiscal Year
or Period Ended October 31,
-----------------------------------------
1999 1998 1997+
<S> <C> <C> <C>
-----------------------------------------

NET ASSET VALUE - BEGINNING OF YEAR...................................... $ 10.24 $ 10.27 $ 10.00
-----------------------------------------
INVESTMENT OPERATIONS:
Net investment income.................................................. 0.53 0.54 0.06
Net realized and unrealized gain (loss) on investments................. (0.45) 0.08 0.21
-----------------------------------------
Total from investment operations................................... 0.08 0.62 0.27
-----------------------------------------
Distributions:
From net investment income............................................. (0.51) (0.59) --
Return of capital...................................................... -- (0.04) --
From net realized gain on investments.................................. -- (0.02) --
-----------------------------------------
Total distributions................................................ (0.51) (0.65) --
-----------------------------------------
NET ASSET VALUE - END OF YEAR............................................ $ 9.81 $ 10.24 $ 10.27
=========================================

TOTAL RETURN............................................................. 0.79% 6.26% 2.70%**
Ratios (to average net assets)/Supplemental Data:
Expenses (net of fee waivers)(1)....................................... 0.61% 0.75% 0.75%
Expenses (excluding fee waivers)....................................... 0.73% 0.88% 2.12%*
Net investment income.................................................. 5.35% 5.60% 5.83%*
Portfolio turnover rate.................................................. 834.18% 92.65% 39.12%*
Net assets, end of period (in 000's)..................................... $ 94,221 $ 71,723 $ 32,537
</TABLE>

<TABLE>
<S> <C>
+ The Fixed Income Fund commenced operations on September 2, 1997.
* Annualized.
** Total return not annualized.
(1) Effective January 1, 1999, the Fund's investment adviser, 1838
Investment Advisors, Inc., voluntarily agreed to waive its fees
and/or reimburse the Fund so the total operating expenses do not
exceed 0.60% of average daily net assets.

</TABLE>

See notes to financial statements.

25
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

FINANCIAL HIGHLIGHTS -- CONTINUED
- --------------------------------------------------------------------------------

The following table includes selected data for a share outstanding throughout
the period and other performance information derived from the financial
statements. It should be read in conjunction with the financial statements and
notes thereto.

LARGE CAP EQUITY FUND

<TABLE>
<CAPTION>
For the
Period Ended
October 31, 1999+
-----------------
<S> <C>
NET ASSET VALUE - BEGINNING OF PERIOD............... $ 10.00
-----------------
INVESTMENT OPERATIONS:
Net investment income............................. 0.01
Net realized and unrealized gain on investments... 0.60
-----------------
Total from investment operations.............. 0.61
-----------------
NET ASSET VALUE - END OF PERIOD..................... $ 10.61
=================
TOTAL RETURN........................................ 6.10%**
RATIOS (TO AVERAGE NET ASSETS)/SUPPLEMENTAL DATA:
Expenses (net of fee waivers)..................... 0.75%*
Expenses (excluding fee waivers).................. 4.98%*
Net investment income............................. 1.55%*
Portfolio turnover rate............................. 5.58%
Net assets, end of period (in 000's)................ $ 4,923
</TABLE>

<TABLE>
<S> <C>
+ The Large Cap Equity Fund commenced operations on September 29, 1999.
* Annualized.
** Total return not annualized.
</TABLE>

See notes to financial statements.

26
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 1 -- DESCRIPTION OF THE FUNDS

The 1838 Investment Advisors Funds (the "Trust") was organized as a
Delaware series business trust on December 9, 1994, and is an open-end,
management investment company registered under the Investment Company Act
of 1940, as amended (the "1940 Act"). The Trust's Agreement and
Declaration of Trust permits the Trustees to issue an unlimited number of
shares of beneficial interest. The Trust consists of five Funds: the 1838
International Equity Fund, the 1838 Small Cap Equity Fund, the 1838 Fixed
Income Fund, the 1838 Large Cap Equity Fund and the 1838 Special Equity
Fund (each a "Fund" and collectively, the "Funds"). Each of the Funds,
except the 1838 Special Equity Fund, is diversified. The investment
objectives of each Fund are set forth below.

The 1838 International Equity Fund (the "International Fund"), the first
of the series currently offered by the Trust, commenced operation on
August 3, 1995. The Fund's investment objective is capital appreciation,
with a secondary objective of income. The Fund seeks to achieve its
objective by investing at least 65% of its total assets in a diversified
portfolio of equity securities of issuers located in countries other than
the United States.

The 1838 Small Cap Equity Fund (the "Small Cap Fund") commenced operations
on June 17, 1996. The Fund's investment objective is long-term growth. The
Fund seeks to achieve its objective by investing at least 65% of its total
assets in the common stock of U.S. companies with market capitalizations
of $2 billion or less (small cap), which are believed to be undervalued
and have good prospects for capital appreciation.

The 1838 Fixed Income Fund (the "Fixed Income Fund") commenced operations
on September 2, 1997. The Fund's investment objective is maximum current
income, with a secondary objective of growth. The Fund seeks to achieve
its objective by investing, under normal circumstances, at least 65% of
its assets in a diversified portfolio of fixed income securities.

The 1838 Large Cap Equity Fund (the "Large Cap Fund") commenced operations
on September 29, 1999. The Fund's investment objective is long-term total
return. The Fund will seek to achieve its objective by investing at least
90% of its total assets in the common stock of U.S. companies with market
capitalizations greater than $5 billion.

The 1838 Special Equity Fund has not commenced operations as of October
31, 1999. The Fund's investment objective is high total return. The Fund
will seek to achieve its objective by investing at least 90% of its total
assets in a select portfolio of the common stock of U.S. companies with
market capitalizations greater than $5 billion.

NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES

Security Valuation. Each Fund's securities except investments with
remaining maturities of 60 days or less, are valued at the last quoted
sales price on the security's principal exchange on that day. If there are
no sales of the relevant security on such day, the security will be valued
at the mean between the closing bid and asked price on that day, if any.
Debt securities having a maturity of 60 days or less are valued at
amortized cost. Securities for which market quotations are not readily
available and all other assets will be valued at their respective fair
value

<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED)

as determined in good faith by, or under procedures established by, the
Board of Trustees. As of October 31, 1999, there were no securities valued
by, or under procedures established by, the Board of Trustees.

Federal Income Taxes. Each Fund is treated as a separate entity and
intends to qualify as a "regulated investment company" under Subchapter M
of the Internal Revenue Code of 1986 and to distribute all of its taxable
income to its shareholders. Therefore, no federal income or excise tax
provision is required.

Dividends and Capital Gain Distributions. Distributions of net investment
income and net realized gains are determined in accordance with income tax
regulations that may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments for foreign
currency transactions for the International Fund. The Fixed Income Fund
distributes net investment income monthly. All other distributions by each
Fund will be made annually in December. Additional distributions may be
made by each Fund to the extent necessary.

Deferred Organizational Costs. Costs incurred by the International Fund
in connection with the initial registration and public offering of shares
have been deferred and are being amortized on a straight-line basis over a
five-year period beginning on the date that the Fund commenced operations.

Foreign Currency Translations. The books and records of the International
Fund are maintained in U.S. dollars. Foreign currency amounts are
translated into U.S. dollars on the following basis:

(i) market value of investment securities, assets and
liabilities at the daily rates of exchange, and

(ii) purchases and sales of investment securities, dividend and
interest income and certain expenses at the rates of
exchange prevailing on the respective dates of such
transactions.

The International Fund does 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.

Reported net realized foreign exchange gains or losses arise from sales
and maturities of short-term securities, sales of foreign currencies,
currency gains or losses realized between the trade and settlement dates
on securities transactions, the difference between the amounts of
dividends, interest, and foreign withholding taxes recorded on the
International Fund's books, and the U.S. dollar equivalent of the amounts
actually received or paid. Net unrealized foreign exchange gains and
losses arise from changes in the value of assets and liabilities, other
than investments in securities, resulting from changes in exchange rates.

Forward Foreign Currency Exchange Contracts. In connection with portfolio
purchases and sales of securities denominated in a foreign currency, the
International Fund may enter into forward foreign currency exchange
contracts ("FFCEC"). Additionally, the International Fund may enter into
these contracts to hedge certain foreign currency assets. Foreign currency
exchange contracts are recorded at fair value. Certain risks may arise
upon entering into these contracts from the potential inability of
counterparties to meet the terms of their contracts. Realized gains or
losses arising from such transactions are included in net realized gain
(loss) from foreign currency transactions. There are no FFCEC outstanding
at October 31, 1999.

28
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED)

Use of Estimates in the Preparation of Financial Statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and
assumptions that may affect the reported amounts of assets and liabilities
at the date of the financial statements and the reported amounts of
revenue and expenses during the reporting period. Actual results could
differ from those estimates.

Other. Investment security transactions are accounted for on a trade date
basis. The specific identification method is utilized for determining
realized gain or loss on investments for both financial and federal income
tax reporting purposes. Dividend income and distributions to shareholders
are recorded on the ex-dividend date. Interest income is recorded on an
accrual basis.

NOTE 3 -- PURCHASES AND SALES OF INVESTMENT SECURITIES

During the fiscal year ended October 31, 1999, purchases and sales of
investment securities, other than short-term investments, were as follows:

<TABLE>
<CAPTION>
International Small Cap Fixed Income Large Cap
Fund Fund Fund Fund
------------- ----------- ------------ ----------
<S> <C> <C> <C> <C>
Purchases......................... $47,507,674 $48,446,318 $718,213,146 $4,636,816
Sales............................. 34,962,504 41,094,218 691,813,751 98,092
</TABLE>

Purchases and sales of U.S. Government securities, during the fiscal year
ended October 31, 1999, were as follows:

<TABLE>
<CAPTION>
International Small Cap Fixed Income Large Cap
Fund Fund Fund Fund
------------- ----------- ------------ ----------
<S> <C> <C> <C> <C>
Purchases......................... $ -- $ -- $340,048,618 $9,868,894
Sales............................. -- -- 345,756,903 9,869,160
</TABLE>

NOTE 4 -- ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES

The Trust, on behalf of each Fund, employs 1838 Investment Advisors, Inc.
(the "Investment Advisor"), a direct, wholly-owned subsidiary of MBIA,
Inc., and registered investment adviser under the 1940 Investment Advisor
Act, to furnish investment advisory services to the Funds pursuant to an
Investment Advisory Agreement with the Trust. The Investment Advisor
supervises the investment of the assets of the Trust in accordance with
each Fund's investment objective, policies and restrictions.

The Trust pays the Investment Advisor a monthly fee at the following
annual rates of each Fund's average daily net assets: 0.75% for the
International Fund, 0.75% for the Small Cap Fund, 0.50% for the Fixed
Income Fund and 0.65% for the Large Cap Fund. The Investment Advisor has
voluntarily agreed to waive its advisory fee and/or reimburse each Fund
monthly to the extent that the total operating expenses (excluding taxes,
extraordinary expenses, brokerage commissions and interest) will exceed
the following annual rates of each Fund's average daily net assets: 1.25%
for the International Fund, 1.25% for the Small Cap Fund, 0.60% for the

29
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 4 -- ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES -- (CONTINUED)

Fixed Income Fund (effective January 1, 1999) and 0.75% for Large Cap
Fund. This undertaking may be rescinded at any time in the future.

The following table summarizes the advisory fees, waivers and
reimbursements incurred by the Trust for the fiscal year ended October 31,
1999:

<TABLE>
<CAPTION>
Gross Advisory Fee Net Advisor
Advisory Fee Waiver Advisory Fee Reimbursement
------------ ------------ ------------ -------------
<S> <C> <C> <C> <C>
International Fund..................... $554,632 $ -0- $554,632 $ -0-
Small Cap Fund......................... 352,199 -0- 352,199 -0-
Fixed Income Fund...................... 418,704 99,887 318,817 -0-
Large Cap Fund......................... 1,580 1,580 -0- 8,759
</TABLE>

Effective August 1, 1999, 1838 Investment Advisors, Inc. ("1838") also
serves as Administrator to the Trust pursuant to an Administration
Agreement with the Trust on behalf of each Fund. As Administrator, 1838 is
responsible for services such as financial reporting, compliance
monitoring and corporate management. Effective September 27, 1999, the
Trust pays 1838 a monthly asset-based fee at the annual rate of 0.06% of
each Fund's average daily net assets, with a minimum annual fee per Fund
of $15,000. For the period August 1, 1999 to September 26, 1999, the Trust
paid 1838 the same fee rate in effect with the previous Administrator,
Declaration Service Company, Inc. ("DSC"). Prior to August 1, 1999, DSC
received a monthly asset-based fee from the Trust at the annual rate of
0.04% of the Trust's average daily net assets between $50 and $100
million; 0.02% of such assets in excess of $100 million to $200 million;
and 0.01% of such assets in excess of $200 million. Each Fund paid its
pro-rata portion based upon its portion of the Trust's average daily net
assets. DSC also received fixed annual administration fees of $27,500 from
the International Fund and $20,000 from the Small Cap Fund and Fixed
Income Fund. For the period November 1, 1998 through July 31, 1999, DSC's
administration fees amounted to $31,061, $15,000 and $27,834, for the
International Fund, the Small Cap Fund and the Fixed Income Fund,
respectively. For the period August 1, 1999 through October 31, 1999,
1838's administration fees amounted to $10,224, $6,322 and $9,524, for the
International Fund, the Small Cap Fund, and the Fixed Income Fund,
respectively. 1838's administration fee from the Large Cap Fund for the
period September 29, 1999 to October 31, 1999 amounted to $1,315.

Effective August 1, 1999, MBIA Municipal Investors Services Corporation
("MBIA MISC"), a direct, wholly-owned subsidiary of MBIA, Inc., serves as
Accounting Agent to the Trust. As Accounting Agent, MBIA MISC determines
each Fund's net asset value per share and provides accounting services to
the Funds pursuant to an Accounting Services Agreement with the Trust.
Effective September 27, 1999, the Small Cap Fund, the Fixed Income Fund
and the Large Cap Fund pay MBIA MISC a monthly asset-based fee at the
annual rate of $40,000, plus 0.03% of each Fund's average daily net assets
in excess of $50 million. The International Fund pays at the annual rate
of $60,000, plus 0.03% of average daily net assets in excess of $50
million. For the period August 1, 1999 to September 26, 1999, the Trust
paid MBIA MISC the same fee rate in effect with the previous Accounting
Agent, DSC. Prior to August 1, 1999, DSC served as Accounting Agent to the
Trust and was paid an annual fee of $25,000 for the International Fund and
$17,500 for the Small Cap Fund and the Fixed Income Fund. For the

30
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 4 -- ADVISORY FEE AND OTHER TRANSACTIONS WITH AFFILIATES -- (CONTINUED)

period November 1, 1998 through July 31, 1999, DSC's accounting fees
amounted to $18,750, $13,125 and $13,125, for the International Fund, the
Small Cap Fund and the Fixed Income Fund, respectively. For the period
August 1, 1999 through October 31, 1999, MBIA MISC accounting fees
amounted to $11,470, $7,100 and $8,857, for the International Fund, the
Small Cap Fund, and the Fixed Income Fund, respectively. MBIA MISC
accounting fee from the Large Cap Fund for the period September 29, 1999
to October 31, 1999 amounted to $3,507.

Effective August 1, 1999, MBIA Capital Management Corporation (the
"distributor"), a direct, wholly-owned subsidiary of MBIA, Inc., entered
into a Distribution Agreement with the Trust to assist in securing
purchasers for shares of each Fund. The distributor also directly or
through its affiliates, provides investor support services. The
distributor receives no compensation for distributing the Funds' shares,
except for reimbursement of its out-of-pocket expenses. Prior to August 1,
1999, Declaration Distributors, Inc. ("DDI") had been engaged pursuant to
a Distribution Agreement with the Trust as distributor of the Funds. DDI
received no compensation from the Funds for distribution of shares of the
Funds.

Effective August 1, 1999, MBIA MISC also serves as the Fund's transfer
agent pursuant to a Transfer Agency Agreement with the Trust. For these
services, effective September 27, 1999, MBIA MISC receives an annual fee
of $20,000 per Fund and is reimbursed for out-of-pocket expenses. For the
period August 1, 1999 to September 26, 1999, the Trust paid MBIA MISC the
same fee rate in effect with the previous transfer agent, DSC. Prior to
August 1, 1999, DSC served as transfer agent and the Trust paid an annual
fee of $12,000 per Fund. For the period November 1, 1998 through July 31,
1999, DSC's transfer agent fees amounted to $9,000 for each Fund. For the
period August 1, 1999 through October 31, 1999, MBIA MISC's transfer agent
fees amounted to $3,666 for each Fund. MBIA MISC's transfer agent fee from
the Large Cap Fund for the period September 29, 1999 to October 31, 1999
amounted to $1,808.

The Trustees of the Trust who are "interested persons" of the Trust, the
Investment Advisor or its affiliates and all personnel of the Trust or the
Investment Advisor performing services related to research, statistical
and investment activities are paid by the Investment Advisor or its
affiliates.

31
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 5 -- FUND SHARE TRANSACTIONS

At October 31, 1999, there were an unlimited number of shares of
beneficial interest with a $0.001 par value, authorized. The following
table summarizes the activity in shares of each Fund:

INTERNATIONAL FUND

<TABLE>
<CAPTION>
For the Fiscal Year For the Fiscal Year
Ended October 31, 1999 Ended October 31, 1998
------------------------- -------------------------
Shares Amount Shares Amount
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Shares sold............................................. 1,088,189 $13,964,098 586,353 $ 7,038,369
Shares issued to shareholders in reinvestment
of distributions...................................... 315,651 3,926,698 234,719 2,586,605
Shares redeemed......................................... (254,808) (3,461,907) (289,378) (3,563,800)
--------- ----------- --------- -----------
Net increase............................................ 1,149,032 $14,428,889 531,694 $ 6,061,174
=========== ===========
Shares outstanding:
Beginning of year.................................. 4,789,497 4,257,803
--------- ---------
End of year........................................ 5,938,529 4,789,497
========= =========
</TABLE>

SMALL CAP FUND

<TABLE>
<CAPTION>
For the Fiscal Year For the Fiscal Year
Ended October 31, 1999 Ended October 31, 1998
------------------------- -------------------------
Shares Amount Shares Amount
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Shares sold............................................. 1,040,098 $11,026,968 1,563,530 $19,341,335
Shares issued to shareholders in reinvestment
of distributions...................................... -- -- 167,292 1,995,798
Shares redeemed......................................... (526,249) (5,211,136) (175,962) (2,168,835)
--------- ----------- --------- -----------
Net increase............................................ 513,849 $ 5,815,832 1,554,860 $19,168,298
=========== ===========
Shares outstanding:
Beginning of year.................................. 3,766,748 2,211,888
--------- ---------
End of year........................................ 4,280,597 3,766,748
========= =========
</TABLE>

32
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 5 -- FUND SHARE TRANSACTIONS -- (CONTINUED)
FIXED INCOME FUND

<TABLE>
<CAPTION>
For the Fiscal Year For the Fiscal Year
Ended October 31, 1999 Ended October 31, 1998
------------------------- -------------------------
Shares Amount Shares Amount
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Shares sold............................................. 2,618,322 $26,346,425 4,099,344 $41,981,069
Shares issued to shareholders in reinvestment
of distributions...................................... 387,326 3,867,673 326,222 3,334,313
Shares redeemed......................................... (405,513) (4,035,234) (590,184) (6,074,382)
--------- ----------- --------- -----------
Net increase............................................ 2,600,135 $26,178,864 3,835,382 $39,241,000
=========== ===========
Shares outstanding:
Beginning of year.................................. 7,004,447 3,169,065
--------- ---------
End of year........................................ 9,604,582 7,004,447
========= =========
</TABLE>

LARGE CAP FUND

<TABLE>
<CAPTION>
For the Period
Ended October 31,1999
-------------------------
Shares Amount
--------- -----------
<S> <C> <C>
Shares sold............................................. 471,281 $ 4,733,341
Shares issued to shareholders in reinvestment
of distributions...................................... -- --
Shares redeemed......................................... (7,337) (72,415)
--------- -----------
Net increase............................................ 463,944 $ 4,660,926
===========
Shares outstanding:
Beginning of period................................ 0
---------
End of period...................................... 463,944
=========
</TABLE>

NOTE 6 -- CONCENTRATION OF RISKS

The International Fund invests in securities of foreign issuers in various
countries. These investments may involve certain considerations and risks
not typically associated with investments in the U.S., as a result of,
among other factors, the possibility of future political and economical
developments and the level of government supervision and regulation of
securities markets in the various countries.

33
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

NOTES TO THE FINANCIAL STATEMENTS -- CONTINUED OCTOBER 31, 1999
- --------------------------------------------------------------------------------

NOTE 7 -- CAPITAL LOSS CARRYOVERS

The following table shows the capital loss carryovers available to offset
possible future capital gains for the following Funds:

<TABLE>
<CAPTION>
Fund Amount Expiration Date
- ---- ---------- ---------------
<S> <C> <C>
Small Cap Fund................................ $ 600,456 10/31/2006
3,067,502 10/31/2007

Fixed Income Fund............................. 71,283 10/31/2006
1,540,705 10/31/2007
</TABLE>

- -------------------------------------------------------------------------------

Shareholder Information (Unaudited)

- --------------------------------------------------------------------------

The 1838 International Equity Fund paid distributions of $0.875446 per share
from net long-term capital gains during the fiscal year ended October 31, 1999.
Pursuant to section 852 of the Internal Revenue Code, the 1838 International
Equity Fund designated $4,289,722 as capital gain distributions for the fiscal
year ended October 31, 1999.

34
<PAGE>

1838 INVESTMENT ADVISORS FUNDS

REPORT OF INDEPENDENT ACCOUNTANTS OCTOBER 31, 1999
- --------------------------------------------------------------------------------

TO THE SHAREHOLDERS AND BOARD OF TRUSTEES
OF 1838 INVESTMENT ADVISORS FUNDS

In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of International Equity Fund, Small
Cap Equity Fund, Fixed Income Fund and Large Cap Equity Fund (constituting 1838
Investment Advisors Funds, hereafter referred to as the "Fund") at October 31,
1999, and the results of each of their operations, the changes in each of their
net assets and the financial highlights for each of the periods indicated, in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Fund'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 October 31, 1999 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.

PRICEWATERHOUSECOOPERS LLP
1177 Avenue of the Americas
New York, New York 10036
December 10, 1999

35
<PAGE>

INVESTMENT ADVISER
AND ADMINISTRATOR
-------------

1838 INVESTMENT ADVISORS, INC.
FIVE RADNOR CORPORATE CENTER
SUITE 320
100 MATSONFORD ROAD
RADNOR, PA 19087

DISTRIBUTOR
-------------

MBIA CAPITAL MANAGEMENT CORPORATION
113 KING STREET
ARMONK, NY 10504

ACCOUNTING AND
TRANSFER AGENT
-------------

MBIA MUNICIPAL INVESTORS SERVICE CORPORATION
113 KING STREET
ARMONK, NY 10504

CUSTODIAN
-------------

FIRST UNION NATIONAL BANK
123 S. BROAD STREET
PHILADELPHIA, PA 19101

LEGAL COUNSEL
-------------

PEPPER HAMILTON LLP
3000 TWO LOGAN SQUARE
EIGHTEENTH & ARCH STREETS
PHILADELPHIA, PA 19103

AUDITORS
-------------

PRICEWATERHOUSECOOPERS LLP
1177 AVENUE OF THE AMERICAS
NEW YORK, NY 10036

1838
INVESTMENT ADVISORS FUNDS

INTERNATIONAL EQUITY FUND
SMALL CAP EQUITY FUND
FIXED INCOME FUND
LARGE CAP EQUITY FUND

ANNUAL REPORT
OCTOBER 31, 1999

AR 10/99