UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21591
---------------------------------------------
AMERICAN CENTURY ASSET ALLOCATION PORTFOLIOS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
4500 MAIN STREET, KANSAS CITY, MISSOURI 64111
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(Address of principal executive offices) (Zip code)
DAVID C. TUCKER, ESQ., 4500 MAIN STREET, 9TH FLOOR, KANSAS CITY, MISSOURI 64111
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: 816-531-5575
----------------------------
Date of fiscal year end: JULY 31
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Date of reporting period: JANUARY 31, 2005
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ITEM 1. REPORTS TO STOCKHOLDERS.
[front cover]
American Century Investments
SEMIANNUAL REPORT
[photo of man and woman]
JANUARY 31, 2005
My Retirement 2015 Portfolio
My Retirement 2025 Portfolio
My Retirement 2035 Portfolio
My Retirement 2045 Portfolio
My Retirement Income Portfolio
[american century investments logo and text logo]
Table of Contents
Our Message to You . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
MY RETIREMENT 2015 PORTFOLIO
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . . 3
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
MY RETIREMENT 2025 PORTFOLIO
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . . 6
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
MY RETIREMENT 2035 PORTFOLIO
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . . 9
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
MY RETIREMENT 2045 PORTFOLIO
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . .12
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
MY RETIREMENT INCOME PORTFOLIO
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . .15
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Shareholder Fee Examples . . . . . . . . . . . . . . . . . . . . . . . . . . .17
FINANCIAL STATEMENTS
Statement of Assets and Liabilities . . . . . . . . . . . . . . . . . . . . . 21
Statement of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Statement of Changes in Net Assets . . . . . . . . . . . . . . . . . . . . . .25
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . 27
Financial Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
OTHER INFORMATION
Share Class Information . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . .54
The opinions expressed in each of the Portfolio Commentaries reflect those of
the portfolio management team as of the date of the report, and do not
necessarily represent the opinions of American Century or any other person in
the American Century organization. Any such opinions are subject to change at
any time based upon market or other conditions and American Century disclaims
any responsibility to update such opinions. These opinions may not be relied
upon as investment advice and, because investment decisions made by American
Century funds are based on numerous factors, may not be relied upon as an
indication of trading intent on behalf of any American Century fund. Security
examples are used for representational purposes only and are not intended as
recommendations to purchase or sell securities. Performance information for
comparative indices and securities is provided to American Century by third
party vendors. To the best of American Century's knowledge, such information is
accurate at the time of printing.
Our Message
[photo of James E. Stowers III and James E. Stowers, Jr.]
JAMES E. STOWERS III WITH JAMES E. STOWERS, JR.
We are pleased to provide you with the semiannual report for the My Retirement
Portfolios for the period ended January 31, 2005.
This report contains information that can help you monitor your investment.
You'll find details about your fund's return and holdings as well as data and
analysis that provide insight into the market conditions affecting the fund's
performance.
Through our Web site, americancentury.com, we provide the views of our senior
investment officers, and other communications about investments, portfolio
strategy, and the markets. We also have many informative resources available in
the Education & Planning section of our site to help you with your investment
strategy.
Your next shareholder report for these funds will be the annual report dated
July 31, 2005, available in approximately six months.
As always, we deeply appreciate your investment with American Century
Investments.
Sincerely,
/s/James E. Stowers, Jr.
James E. Stowers, Jr.
FOUNDER
/s/James E. Stowers III
James E. Stowers III
CHAIRMAN OF THE BOARD
- ------
1
My Retirement 2015 Portfolio - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 6.80% 8/31/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 8.87% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.86% --
- --------------------------------------------------------------------------------
Institutional Class 6.85% 8/31/04
- --------------------------------------------------------------------------------
Advisor Class 6.62% 8/31/04
- --------------------------------------------------------------------------------
R Class 6.53% 8/31/04
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
2
My Retirement 2015 Portfolio - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on August 31, 2004, through January 31, 2005, My Retirement
2015 returned 6.80%*. This return reflected the positive performance of the
portfolio's equity, fixed-income, and money market components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the five months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 8.87%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small-cap stocks outperformed large-cap issues, while growth and value stocks
were mixed--value surpassed growth among large-cap stocks, while growth came out
ahead in the smaller-cap segment of the market.
Bonds produced modest gains during the five-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.86%. The best
performers were corporate bonds, particularly high-yield corporate bonds, and
mortgage-backed securities.
Foreign stocks and bonds both outpaced their respective domestic markets.
Money market rates increased as the Federal Reserve raised short-term interest
rates three times during the five-month period, boosting the three-month
Treasury bill yield from 1.59% to 2.51%.
PORTFOLIO STRATEGY
My Retirement 2015 seeks the highest total return consistent with its target
asset mix of 53% stocks, 42% bonds, and 5% cash equivalents. The portfolio is a
"fund of funds," which means it invests in other American Century mutual funds
to achieve its investment objective and target asset allocation. (See the
following page for a list of the underlying funds in the portfolio.)
The portfolio's target asset allocation, which features a diversified mix of
asset classes and investment styles, will be adjusted annually. In general, the
allocation to stocks will go down and the allocations to bonds and cash will
increase each year until 2015, when the portfolio's asset mix will become fixed
and match that of My Retirement Income (see page 15).
An investment in My Retirement 2015 entails some risks, including those
associated with investing in stocks, bonds, and foreign securities. The value of
the portfolio's shares will fluctuate over time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Equity Funds 44.9%
- --------------------------------------------------------------------------------
International Equity Funds 8.3%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 53.2%
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 36.8%
- --------------------------------------------------------------------------------
International Fixed Income Funds 5.0%
- --------------------------------------------------------------------------------
TOTAL FIXED INCOME EXPOSURE 41.8%
- --------------------------------------------------------------------------------
Money Market Funds 5.0%
- --------------------------------------------------------------------------------
*All fund returns referenced in this commentary are for Investor Class shares.
Not annualized.
- ------
3
My Retirement 2015 Portfolio - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST GAIN (LOSS) RECEIVED(1) VALUE
- --------------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.9%
- --------------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 44.8%
- -------------------------------------------
61,215 Income & Growth Fund
Institutional Class $ 1,805,134 -- -- $ 8,189 $ 1,829,716
- -------------------------------------------
262,297 Large Company Value Fund
Institutional Class 1,641,981 -- -- 9,223 1,665,586
- -------------------------------------------
33,668 Real Estate Fund
Institutional Class 819,788 -- -- 32,124 769,987
- -------------------------------------------
33,733 Small Company Fund
Institutional Class 327,931 -- -- 7,413 338,679
- -------------------------------------------
46,098 Ultra Fund
Institutional Class(3) 1,312,388 -- -- -- 1,333,154
- -------------------------------------------
107,995 Value Fund
Institutional Class 820,785 -- -- 54,967 784,044
- -------------------------------------------
47,275 Vista Fund
Institutional Class(3) 656,153 -- -- -- 684,542
- --------------------------------------------------------------------------------------------------------------
7,384,160 -- -- 111,916 7,405,708
- --------------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 36.8%
- -------------------------------------------
472,986 Diversified Bond Fund
Institutional Class 4,860,791 -- -- 55,438 4,852,837
- -------------------------------------------
92,083 High-Yield Fund
Institutional Class 607,318 -- -- 6,759 605,906
- -------------------------------------------
53,938 Inflation-Adjusted Bond Fund
Institutional Class 607,128 -- -- 4,671 609,499
- --------------------------------------------------------------------------------------------------------------
6,075,237 -- -- 66,868 6,068,242
- --------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 8.3%
- -------------------------------------------
52,885 Emerging Markets Fund
Institutional Class 328,135 -- -- 1,445 350,628
- -------------------------------------------
114,299 International Growth Fund
Institutional Class 984,946 -- -- 6,987 1,011,546
- --------------------------------------------------------------------------------------------------------------
1,313,081 -- -- 8,432 1,362,174
- --------------------------------------------------------------------------------------------------------------
INTERNATIONAL FIXED INCOME FUNDS -- 5.0%
- -------------------------------------------
56,900 International Bond Fund
Institutional Class 820,443 -- -- 15,077 823,912
- --------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 5.0%
- -------------------------------------------
821,122 Premium Money Market Fund
Investor Class 821,122 -- -- 2,282 821,122
- --------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.9%
(Cost $16,414,043) $16,414,043 -- -- $204,575 16,481,158
- -------------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.1% 16,567
- ------------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $16,497,725
- ------------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period August 31, 2004 (fund inception) through January 31, 2005, is shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
4
My Retirement 2025 Portfolio - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 8.00% 8/31/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 8.87% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.86% --
- --------------------------------------------------------------------------------
Institutional Class 8.06% 8/31/04
- --------------------------------------------------------------------------------
Advisor Class 7.91% 8/31/04
- --------------------------------------------------------------------------------
R Class 7.74% 8/31/04
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
5
My Retirement 2025 Portfolio - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on August 31, 2004, through January 31, 2005, My Retirement
2025 returned 8.00%*. This return reflected the positive performance of the
portfolio's equity, fixed-income, and money market components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the five months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 8.87%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small-cap stocks outperformed large-cap issues, while growth and value stocks
were mixed--value surpassed growth among large-cap stocks, while growth came out
ahead in the smaller-cap segment of the market. Foreign stocks, led by emerging
markets, outpaced domestic shares.
Bonds produced modest gains during the five-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.86%. The best
performers were corporate bonds, particularly high-yield corporate bonds, and
mortgage-backed securities.
Money market rates increased as the Federal Reserve raised short-term interest
rates three times during the five-month period, boosting the three-month
Treasury bill yield from 1.59% to 2.51%.
PORTFOLIO STRATEGY
My Retirement 2025 seeks the highest total return consistent with its target
asset mix of 67% stocks, 28% bonds, and 5% cash equivalents. The portfolio is a
"fund of funds," which means it invests in other American Century mutual funds
to achieve its investment objective and target asset allocation. (See the
following page for a list of the underlying funds in the portfolio.)
The portfolio's target asset allocation, which features a diversified mix of
asset classes and investment styles, will be adjusted annually. In general, the
allocation to stocks will go down and the allocations to bonds and cash will
increase each year until 2025, when the portfolio's asset mix will become fixed
and match that of My Retirement Income (see page 15).
An investment in My Retirement 2025 entails some risks, including those
associated with investing in stocks, bonds, and foreign equities. The value of
the portfolio's shares will fluctuate over time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Equity Funds 55.0%
- --------------------------------------------------------------------------------
International Equity Funds 12.3%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 67.3%
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 27.7%
- --------------------------------------------------------------------------------
Money Market Funds 5.0%
- --------------------------------------------------------------------------------
*All fund returns referenced in this commentary are for Investor Class shares.
Not annualized.
- ------
6
My Retirement 2025 Portfolio - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST GAIN (LOSS) RECEIVED(1) VALUE
- --------------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.9%
- --------------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 54.9%
- -------------------------------------------
211,917 Equity Growth Fund
Institutional Class $ 4,493,113 $ 8,496 $ 9 $ 11,137 $ 4,594,362
- -------------------------------------------
716,207 Large Company Value Fund
Institutional Class 4,493,794 8,480 4 21,302 4,547,914
- -------------------------------------------
76,099 Real Estate Fund
Institutional Class 1,871,228 3,684 (109) 65,357 1,740,384
- -------------------------------------------
154,362 Small Company Fund
Institutional Class 1,497,535 2,829 7 29,461 1,549,794
- -------------------------------------------
157,291 Ultra Fund
Institutional Class(3) 4,492,651 8,515 -- -- 4,548,856
- -------------------------------------------
246,812 Value Fund
Institutional Class 1,872,179 3,674 (132) 114,812 1,791,855
- -------------------------------------------
134,448 Vista Fund
Institutional Class(3) 1,871,787 3,542 6 -- 1,946,807
- --------------------------------------------------------------------------------------------------------------
20,592,287 39,220 (215) 242,069 20,719,972
- --------------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 27.7%
- -------------------------------------------
814,741 Diversified Bond Fund
Institutional Class 8,388,463 15,995 (146) 89,880 8,359,242
- -------------------------------------------
158,403 High-Yield Fund
Institutional Class 1,048,265 1,992 (8) 11,166 1,042,292
- -------------------------------------------
92,865 Inflation-Adjusted Bond Fund
Institutional Class 1,048,038 2,018 (22) 7,538 1,049,375
- --------------------------------------------------------------------------------------------------------------
10,484,766 20,005 (176) 108,584 10,450,909
- --------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 12.3%
- -------------------------------------------
179,835 Emerging Markets Fund
Institutional Class 1,123,238 2,154 (22) 4,302 1,192,306
- -------------------------------------------
388,431 International Growth Fund
Institutional Class 3,370,099 6,449 (78) 20,727 3,437,614
- --------------------------------------------------------------------------------------------------------------
4,493,337 8,603 (100) 25,029 4,629,920
- --------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 5.0%
- -------------------------------------------
1,868,948 Premium Money Market Fund
Investor Class 1,872,481 3,533 -- 5,019 1,868,948
- --------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.9%
(Cost $37,371,510) $37,442,871 $71,361 $(491) $380,701 37,669,749
- -------------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.1% 30,877
- ------------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $37,700,626
- ------------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period August 31, 2004 (fund inception) through January 31, 2005, is shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
7
My Retirement 2035 Portfolio - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 9.33% 8/31/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 8.87% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.86% --
- --------------------------------------------------------------------------------
Institutional Class 9.50% 8/31/04
- --------------------------------------------------------------------------------
Advisor Class 9.25% 8/31/04
- --------------------------------------------------------------------------------
R Class 9.17% 8/31/04
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
8
My Retirement 2035 Portfolio - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on August 31, 2004, through January 31, 2005, My Retirement
2035 returned 9.33%*. This return reflected the positive performance of the
portfolio's equity, fixed-income, and money market components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the five months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 8.87%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small-cap stocks outperformed large-cap issues, while growth and value stocks
were mixed--value surpassed growth among large-cap stocks, while growth came out
ahead in the smaller-cap segment of the market. Foreign stocks, led by emerging
markets, outpaced domestic shares.
Bonds produced modest gains during the five-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.86%. The best
performers were corporate bonds, particularly high-yield corporate bonds, and
mortgage-backed securities.
Money market rates increased as the Federal Reserve raised short-term interest
rates three times during the five-month period.
PORTFOLIO STRATEGY
My Retirement 2035 seeks the highest total return consistent with its target
asset mix of 80% stocks, 18% bonds, and 2% cash equivalents. The portfolio is a
"fund of funds," which means it invests in other American Century mutual funds
to achieve its investment objective and target asset allocation. (See the
following page for a list of the underlying funds in the portfolio.)
The portfolio's target asset allocation, which features a diversified mix of
asset classes and investment styles, will be adjusted annually. In general, the
allocation to stocks will go down and the allocations to bonds and cash will
increase each year until 2035, when the portfolio's asset mix will become fixed
and match that of My Retirement Income (see page 15).
An investment in My Retirement 2035 entails some risks, including those
associated with investing in stocks, bonds, and foreign equities. The value of
the portfolio's shares will fluctuate over time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Equity Funds 64.9%
- --------------------------------------------------------------------------------
International Equity Funds 15.4%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 80.3%
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 17.7%
- --------------------------------------------------------------------------------
Money Market Funds 2.0%
- --------------------------------------------------------------------------------
*All fund returns referenced in this commentary are for Investor Class shares.
Not annualized.
- ------
9
My Retirement 2035 Portfolio - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST LOSS RECEIVED(1) VALUE
- --------------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.9%
- --------------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 64.8%
- -------------------------------------------
51,644 Equity Growth Fund
Institutional Class $1,107,700 $ 16,452 $ (73) $ 2,820 $1,119,642
- -------------------------------------------
174,969 Large Company Value Fund
Institutional Class 1,108,578 16,374 (3) 5,360 1,111,053
- -------------------------------------------
16,063 Real Estate Fund
Institutional Class 394,818 6,214 (347) 13,984 367,361
- -------------------------------------------
32,205 Small Company Fund
Institutional Class 316,316 4,825 (130) 6,774 323,338
- -------------------------------------------
38,426 Ultra Fund
Institutional Class(3) 1,107,369 16,503 (101) -- 1,111,280
- -------------------------------------------
72,350 Value Fund
Institutional Class 554,038 9,328 (1,135) 34,122 525,261
- -------------------------------------------
39,416 Vista Fund
Institutional Class(3) 553,728 8,263 (61) -- 570,744
- --------------------------------------------------------------------------------------------------------------
5,142,547 77,959 (1,850) 63,060 5,128,679
- --------------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 17.7%
- -------------------------------------------
109,283 Diversified Bond Fund
Institutional Class 1,140,066 17,107 (262) 11,917 1,121,244
- -------------------------------------------
21,255 High-Yield Fund
Institutional Class 142,201 2,108 -- 1,445 139,858
- -------------------------------------------
12,427 Inflation-Adjusted Bond Fund
Institutional Class 141,961 2,121 (1) 1,001 140,425
- --------------------------------------------------------------------------------------------------------------
1,424,228 21,336 (263) 14,363 1,401,527
- --------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 15.4%
- -------------------------------------------
62,686 Emerging Markets Fund
Institutional Class 395,725 5,941 (92) 1,666 415,608
- -------------------------------------------
90,545 International Growth Fund
Institutional Class 791,650 11,821 (126) 5,370 801,323
- --------------------------------------------------------------------------------------------------------------
1,187,375 17,762 (218) 7,036 1,216,931
- --------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 2.0%
- -------------------------------------------
156,019 Premium Money Market Fund
Investor Class 158,359 2,340 -- 401 156,019
- --------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.9%
(Cost $7,793,112) $7,912,509 $119,397 $(2,331) $84,860 7,903,156
- -------------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.1% 8,770
- ------------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $7,911,926
- ------------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period August 31, 2004 (fund inception) through January 31, 2005, is shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
10
My Retirement 2045 Portfolio - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 10.07% 8/31/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 8.87% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.86% --
- --------------------------------------------------------------------------------
Institutional Class 10.12% 8/31/04
- --------------------------------------------------------------------------------
Advisor Class 9.89% 8/31/04
- --------------------------------------------------------------------------------
R Class 9.81% 8/31/04
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
11
My Retirement 2045 Portfolio - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on August 31, 2004, through January 31, 2005, My Retirement
2045 returned 10.07%*. This return reflected the positive performance of the
portfolio's equity, fixed-income, and money market components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the five months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 8.87%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small-cap stocks outperformed large-cap issues, while growth and value stocks
were mixed--value surpassed growth among large-cap stocks, while growth came out
ahead in the smaller-cap segment of the market. Foreign stocks, led by emerging
markets, outpaced domestic shares.
Bonds produced modest gains during the five-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.86%. The best
performers were corporate bonds, particularly high-yield corporate bonds, and
mortgage-backed securities.
Money market rates increased as the Federal Reserve raised short-term interest
rates three times during the five-month period.
PORTFOLIO STRATEGY
My Retirement 2045 seeks the highest total return consistent with its target
asset mix of 85% stocks, 13% bonds, and 2% cash equivalents. The portfolio is a
"fund of funds," which means it invests in other American Century mutual funds
to achieve its investment objective and target asset allocation. (See the
following page for a list of the underlying funds in the portfolio.)
The portfolio's target asset allocation, which features a diversified mix of
asset classes and investment styles, will be adjusted annually. In general, the
allocation to stocks will go down and the allocations to bonds and cash will
increase each year until 2045, when the portfolio's asset mix will become fixed
and match that of My Retirement Income (see page 15).
An investment in My Retirement 2045 entails some risks, including those
associated with investing in stocks, bonds, and foreign equities. The value of
the portfolio's shares will fluctuate over time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Equity Funds 69.8%
- --------------------------------------------------------------------------------
International Equity Funds 15.5%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 85.3%
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 12.7%
- --------------------------------------------------------------------------------
Money Market Funds 2.0%
- --------------------------------------------------------------------------------
*All fund returns referenced in this commentary are for Investor Class shares.
Not annualized.
- ------
12
My Retirement 2045 Portfolio - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST LOSS RECEIVED(1) VALUE
- --------------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 100.0%
- --------------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 69.8%
- -------------------------------------------
63,633 Equity Growth Fund
Institutional Class $1,355,745 $ 27,648 $ (198) $ 4,474 $1,379,563
- -------------------------------------------
214,752 Large Company Value Fund
Institutional Class 1,356,581 27,641 (266) 8,661 1,363,675
- -------------------------------------------
17,876 Real Estate Fund
Institutional Class 451,240 9,372 (176) 21,822 408,824
- -------------------------------------------
46,270 Small Company Fund
Institutional Class 451,746 9,261 (93) 12,363 464,551
- -------------------------------------------
47,178 Ultra Fund
Institutional Class(3) 1,355,375 27,635 (205) -- 1,364,388
- -------------------------------------------
86,460 Value Fund
Institutional Class 678,024 14,198 (491) 58,391 627,700
- -------------------------------------------
48,373 Vista Fund
Institutional Class(3) 677,642 13,889 (122) -- 700,441
- --------------------------------------------------------------------------------------------------------------
6,326,353 129,644 (1,551) 105,711 6,309,142
- --------------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 15.5%
- -------------------------------------------
86,968 Emerging Markets Fund
Institutional Class 542,421 11,035 (62) 2,888 576,598
- -------------------------------------------
93,332 International Growth Fund
Institutional Class 813,711 16,554 (96) 6,943 825,988
- --------------------------------------------------------------------------------------------------------------
1,356,132 27,589 (158) 9,831 1,402,586
- --------------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 12.7%
- -------------------------------------------
89,441 Diversified Bond Fund
Institutional Class 940,223 19,111 (100) 12,847 917,664
- -------------------------------------------
17,401 High-Yield Fund
Institutional Class 117,310 2,399 (1) 1,434 114,499
- -------------------------------------------
10,185 Inflation-Adjusted Bond Fund
Institutional Class 117,072 2,428 (4) 1,087 115,091
- --------------------------------------------------------------------------------------------------------------
1,174,605 23,938 (105) 15,368 1,147,254
- --------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 2.0%
- ------------------------------------------
177,226 Premium Money Market Fund
Investor Class 180,877 3,651 -- 560 177,226
- --------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 100.0%
(Cost $8,853,145) $9,037,967 $184,822 $(1,814) $131,470 9,036,208
- -------------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES(4) 3,479
- ------------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $9,039,687
- ------------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period August 31, 2004 (fund inception) through January 31, 2005, is shown.
(3) Non-income producing.
(4) Category is less than 0.05% of total net assets.
See Notes to Financial Statements.
- ------
13
My Retirement Income Portfolio - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 5.00% 8/31/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 8.87% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.86% --
- --------------------------------------------------------------------------------
Institutional Class 5.06% 8/31/04
- --------------------------------------------------------------------------------
Advisor Class 4.92% 8/31/04
- --------------------------------------------------------------------------------
R Class 4.75% 8/31/04
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
14
My Retirement Income Portfolio - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on August 31, 2004, through January 31, 2005, My Retirement
Income returned 5.00%*. This return reflected the positive performance of the
portfolio's fixed-income, equity, and money market components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the five months
covered by this report. Bonds produced modest gains; the Lehman Brothers U.S.
Aggregate Index, a broad bond market measure, returned 1.86%. The best
performers were corporate bonds, particularly high-yield corporate bonds, and
mortgage-backed securities. Foreign bonds outpaced the domestic market.
The stock market registered solid gains during the five-month period, with the
broad Russell 3000 Index returning 8.87%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small-cap stocks outperformed large-cap issues, while growth and value stocks
were mixed--value surpassed growth among large-cap stocks, while growth came out
ahead in the smaller-cap segment of the market.
Money market rates increased as the Federal Reserve raised short-term interest
rates three times during the five-month period, boosting the three-month
Treasury bill yield from 1.59% to 2.51%.
PORTFOLIO STRATEGY
My Retirement Income seeks current income, with capital appreciation as a
secondary objective, by investing in a diversified mix of asset classes and
investment styles. The portfolio is a "fund of funds," which means it invests in
other American Century mutual funds to achieve its investment objectives and
target asset allocation. (See the following page for a list of the underlying
funds in the portfolio.)
The portfolio's target asset allocation is 55% bonds, 35% stocks, and 10% cash
equivalents. This target asset mix is expected to remain fixed over time. The
portfolio's asset mix is reviewed quarterly and rebalanced if necessary to
maintain the target allocation.
Although this is the most conservative My Retirement Portfolio, it nonetheless
entails some risks, including those associated with investing in bonds, stocks,
and foreign securities. The value of the portfolio's shares will fluctuate over
time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 44.8%
- --------------------------------------------------------------------------------
International Fixed Income Funds 10.1%
- --------------------------------------------------------------------------------
TOTAL FIXED INCOME EXPOSURE 54.9%
- --------------------------------------------------------------------------------
Domestic Equity Funds 35.1%
- --------------------------------------------------------------------------------
Money Market Funds 10.0%
- --------------------------------------------------------------------------------
*All fund returns referenced in this commentary are for Investor Class shares.
Not annualized.
- ------
15
My Retirement Income Portfolio - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST LOSS RECEIVED(1) VALUE
- --------------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.9%
- --------------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 44.7%
- -------------------------------------------
308,680 Diversified Bond Fund
Institutional Class $3,212,596 $ 37,140 $ (377) $ 41,363 $3,167,056
- -------------------------------------------
60,182 High-Yield Fund
Institutional Class 401,346 4,630 (13) 5,041 395,998
- -------------------------------------------
35,254 Inflation-Adjusted Bond Fund
Institutional Class 401,115 4,685 (36) 3,494 398,370
- --------------------------------------------------------------------------------------------------------------
4,015,057 46,455 (426) 49,898 3,961,424
- --------------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 35.1%
- -------------------------------------------
30,193 Income & Growth Fund
Institutional Class 891,217 10,463 (69) 4,391 902,470
- -------------------------------------------
120,787 Large Company Value Fund
Institutional Class 758,387 8,756 (53) 4,689 766,997
- -------------------------------------------
18,081 Real Estate Fund
Institutional Class 445,323 5,509 (234) 19,808 413,512
- -------------------------------------------
13,768 Small Company Fund
Institutional Class 133,420 1,607 (32) 3,393 138,231
- -------------------------------------------
15,600 Ultra Fund
Institutional Class(3) 444,973 5,297 (40) -- 451,152
- -------------------------------------------
34,643 Value Fund
Institutional Class 267,421 3,304 (197) 20,636 251,508
- -------------------------------------------
12,798 Vista Fund
Institutional Class(3) 177,825 2,137 (25) -- 185,315
- --------------------------------------------------------------------------------------------------------------
3,118,566 37,073 (650) 52,917 3,109,185
- --------------------------------------------------------------------------------------------------------------
INTERNATIONAL FIXED INCOME FUNDS -- 10.1%
- -------------------------------------------
61,537 International Bond Fund
Institutional Class 891,845 10,464 (187) 17,598 891,056
- --------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 10.0%
- -------------------------------------------
882,274 Premium Money Market Fund
Investor Class 892,476 10,202 -- 2,734 882,274
- --------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.9%
(Cost $8,813,750) $8,917,944 $104,194 $(1,263) $123,147 8,843,939
- -------------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.1% 11,544
- ------------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $8,855,483
- ------------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period August 31, 2004 (fund inception) through January 31, 2005, is shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
16
Shareholder Fee Examples (Unaudited)
Fund shareholders may incur two types of costs: (1) transaction costs, including
sales charges (loads) on purchase payments and redemption/exchange fees; and (2)
ongoing costs, including management fees; distribution and service (12b-1) fees;
and other fund expenses. This example is intended to help you understand your
ongoing costs (in dollars) of investing in your fund and to compare these costs
with the ongoing cost of investing in other mutual funds. As a shareholder in
the underlying American Century funds, your fund will indirectly bear its pro
rata share of the expenses incurred by the underlying funds. These expenses are
not included in the fund's annualized expense ratio used to calculate the
expense estimate in this example. If they were, the estimate of expenses you
paid during the period would be higher.
The example is based on an investment of $1,000 made at the beginning of the
period and held for the entire period from August 1, 2004 to January 31, 2005
(except as noted).
ACTUAL EXPENSES
The table provides information about actual account values and actual expenses
for each class. You may use the information, together with the amount you
invested, to estimate the expenses that you paid over the period. First,
identify the share class you own. Then simply divide your account value by
$1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then
multiply the result by the number under the heading "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century fund, or Institutional
Class shares of the American Century Diversified Bond Fund, in an American
Century account (i.e., not a financial intermediary or retirement plan account),
American Century may charge you a $12.50 semiannual account maintenance fee if
the value of those shares is less than $10,000. We will redeem shares
automatically in one of your accounts to pay the $12.50 fee. In determining your
total eligible investment amount, we will include your investments in all
PERSONAL ACCOUNTS (including American Century Brokerage accounts) registered
under your Social Security number. PERSONAL ACCOUNTS include individual
accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell
Education Savings Accounts and IRAs (including traditional, Roth, Rollover,
SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you
have only business, business retirement, employer-sponsored or American Century
Brokerage accounts, you are currently not subject to this fee. We will not
charge the fee as long as you choose to manage your accounts exclusively online.
If you are subject to the Account Maintenance Fee, your account value could be
reduced by the fee amount.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The table also provides information about hypothetical account values and
hypothetical expenses based on the actual expense ratio of each class of your
fund and an assumed rate of return of 5% per year before expenses, which is not
the actual return of a
(continued)
- ------
17
Shareholder Fee Examples (Unaudited)
fund's share class. The hypothetical account values and expenses may not be used
to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in your fund and other funds. To do so, compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of the
other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads) or redemption/exchange fees. Therefore, the table is useful in
comparing ongoing costs only, and will not help you determine the relative total
costs of owning different funds. In addition, if these transactional costs were
included, your costs would have been higher.
- --------------------------------------------------------------------------------
EXPENSES PAID
BEGINNING ENDING DURING PERIOD(1) ANNUALIZED
ACCOUNT VALUE ACCOUNT VALUE 8/1/04 - EXPENSE
8/1/04 1/31/05 1/31/05 RATIO(1)
- --------------------------------------------------------------------------------
MY RETIREMENT 2015 PORTFOLIO SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
ACTUAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,068.00(2) $0.87(3) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,068.50(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,066.20(2) $1.95(3) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,065.30(2) $3.03(3) 0.70%
- --------------------------------------------------------------------------------
HYPOTHETICAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,024.20(4) $1.02(4) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,025.21(4) $0.00(4) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,022.94(4) $2.29(4) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,021.68(4) $3.57(4) 0.70%
- --------------------------------------------------------------------------------
(1) Expenses are equal to the class's annualized expense ratio listed in the
table above, multiplied by the average account value over the period,
multiplied by 184, the number of days in the most recent fiscal half-year,
divided by 365, to reflect the one-half year period. The fees and expenses
of the underlying American Century funds in which the fund invests are not
included in the class's annualized expense ratio.
(2) Ending account values based on actual returns from August 31, 2004 (fund
inception) through January 31, 2005.
(3) Expenses are equal to the class's annualized expense ratio listed in the
table above, multiplied by the average account value over the period,
multiplied by 153, the number of days in the period from August 31, 2004
(fund inception) through January 31, 2005, divided by 365, to reflect the
period ended. Had the class been available for the full period, the expenses
paid during the period would have been higher. The fees and expenses of the
underlying American Century funds in which the fund invests are not included
in the class's annualized expense ratio.
(4) Ending account value and expenses paid during the period assumes each class
had been available throughout the entire period and are calculated using
each class's annualized expense ratio listed in the table above.
(continued)
- ------
18
Shareholder Fee Examples (Unaudited)
- --------------------------------------------------------------------------------
EXPENSES PAID
BEGINNING ENDING DURING PERIOD(1) ANNUALIZED
ACCOUNT VALUE ACCOUNT VALUE 8/1/04 - EXPENSE
8/1/04 1/31/05 1/31/05 RATIO(1)
- --------------------------------------------------------------------------------
MY RETIREMENT 2025 PORTFOLIO SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
ACTUAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,080.00(2) $0.87(3) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,080.60(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,079.10(2) $1.96(3) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,077.40(2) $3.05(3) 0.70%
- --------------------------------------------------------------------------------
HYPOTHETICAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,024.20(4) $1.02(4) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,025.21(4) $0.00(4) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,022.94(4) $2.29(4) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,021.68(4) $3.57(4) 0.70%
- --------------------------------------------------------------------------------
MY RETIREMENT 2035 PORTFOLIO SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
ACTUAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,093.30(2) $0.88(3) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,095.00(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,092.50(2) $1.97(3) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,091.70(2) $3.07(3) 0.70%
- --------------------------------------------------------------------------------
HYPOTHETICAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,024.20(4) $1.02(4) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,025.21(4) $0.00(4) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,022.94(4) $2.29(4) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,021.68(4) $3.57(4) 0.70%
- --------------------------------------------------------------------------------
(1) Expenses are equal to the class's annualized expense ratio listed in the
table above, multiplied by the average account value over the period,
multiplied by 184, the number of days in the most recent fiscal half-year,
divided by 365, to reflect the one-half year period. The fees and expenses
of the underlying American Century funds in which the fund invests are not
included in the class's annualized expense ratio.
(2) Ending account values based on actual returns from August 31, 2004 (fund
inception) through January 31, 2005.
(3) Expenses are equal to the class's annualized expense ratio listed in the
table above, multiplied by the average account value over the period,
multiplied by 153, the number of days in the period from August 31, 2004
(fund inception) through January 31, 2005, divided by 365, to reflect the
period ended. Had the class been available for the full period, the expenses
paid during the period would have been higher. The fees and expenses of the
underlying American Century funds in which the fund invests are not included
in the class's annualized expense ratio.
(4) Ending account value and expenses paid during the period assumes each class
had been available throughout the entire period and are calculated using
each class's annualized expense ratio listed in the table above.
(continued)
- ------
19
Shareholder Fee Examples (Unaudited)
- --------------------------------------------------------------------------------
EXPENSES PAID
BEGINNING ENDING DURING PERIOD(1) ANNUALIZED
ACCOUNT VALUE ACCOUNT VALUE 8/1/04 - EXPENSE
8/1/04 1/31/05 1/31/05 RATIO(1)
- --------------------------------------------------------------------------------
MY RETIREMENT 2045 PORTFOLIO SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
ACTUAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,100.70(2) $0.88(3) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,101.20(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,098.90(2) $1.98(3) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,098.10(2) $3.08(3) 0.70%
- --------------------------------------------------------------------------------
HYPOTHETICAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,024.20(4) $1.02(4) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,025.21(4) $0.00(4) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,022.94(4) $2.29(4) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,021.68(4) $3.57(4) 0.70%
- --------------------------------------------------------------------------------
MY RETIREMENT INCOME PORTFOLIO SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
ACTUAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,050.00(2) $0.86(3) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,050.60(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,049.20(2) $1.93(3) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,047.50(2) $3.00(3) 0.70%
- --------------------------------------------------------------------------------
HYPOTHETICAL
- --------------------------------------------------------------------------------
Investor Class $1,000 $1,024.20(4) $1.02(4) 0.20%
- --------------------------------------------------------------------------------
Institutional Class $1,000 $1,025.21(4) $0.00(4) 0.00%
- --------------------------------------------------------------------------------
Advisor Class $1,000 $1,022.94(4) $2.29(4) 0.45%
- --------------------------------------------------------------------------------
R Class $1,000 $1,021.68(4) $3.57(4) 0.70%
- --------------------------------------------------------------------------------
(1) Expenses are equal to the class's annualized expense ratio listed in the
table above, multiplied by the average account value over the period,
multiplied by 184, the number of days in the most recent fiscal half-year,
divided by 365, to reflect the one-half year period. The fees and expenses
of the underlying American Century funds in which the fund invests are not
included in the class's annualized expense ratio.
(2) Ending account values based on actual returns from August 31, 2004 (fund
inception) through January 31, 2005.
(3) Expenses are equal to the class's annualized expense ratio listed in the
table above, multiplied by the average account value over the period,
multiplied by 153, the number of days in the period from August 31, 2004
(fund inception) through January 31, 2005, divided by 365, to reflect the
period ended. Had the class been available for the full period, the expenses
paid during the period would have been higher. The fees and expenses of the
underlying American Century funds in which the fund invests are not included
in the class's annualized expense ratio.
(4) Ending account value and expenses paid during the period assumes each class
had been available throughout the entire period and are calculated using
each class's annualized expense ratio listed in the table above.
- ------
20
Statement of Assets and Liabilities
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------
2015 2025 2035
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investment securities in affiliates,
at value (cost of $16,414,043,
$37,371,510 and $7,793,112,
respectively) $16,481,158 $37,669,749 $7,903,156
- ------------------------------------
Cash 2,219 3,142 988
- ------------------------------------
Receivable for capital shares sold -- -- 5,000
- ------------------------------------
Distributions receivable
from affiliates 16,472 30,814 3,698
- --------------------------------------------------------------------------------
16,499,849 37,703,705 7,912,842
- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Accrued administrative fees 2,120 3,075 913
- ------------------------------------
Service and distribution
fees payable 4 4 3
- --------------------------------------------------------------------------------
2,124 3,079 916
- --------------------------------------------------------------------------------
NET ASSETS $16,497,725 $37,700,626 $7,911,926
================================================================================
NET ASSETS CONSIST OF:
- --------------------------------------------------------------------------------
Capital (par value and
paid-in surplus) $16,397,611 $37,273,669 $7,774,077
- ------------------------------------
Accumulated undistributed net
investment income (loss) (27,765) 1,918 (1,604)
- ------------------------------------
Undistributed net realized gain
on investment transactions 60,764 126,800 29,409
- ------------------------------------
Net unrealized appreciation
on investments 67,115 298,239 110,044
- --------------------------------------------------------------------------------
$16,497,725 $37,700,626 $7,911,926
================================================================================
INVESTOR CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $14,677,118 $21,297,123 $6,476,720
- ------------------------------------
Shares outstanding 1,398,355 1,997,702 599,542
- ------------------------------------
Net asset value per share $10.50 $10.66 $10.80
- --------------------------------------------------------------------------------
INSTITUTIONAL CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $1,799,879 $16,387,669 $1,424,287
- ------------------------------------
Shares outstanding 171,426 1,536,841 131,815
- ------------------------------------
Net asset value per share $10.50 $10.66 $10.81
- --------------------------------------------------------------------------------
ADVISOR CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $15,401 $10,445 $5,463
- ------------------------------------
Shares outstanding 1,468 980 506
- ------------------------------------
Net asset value per share $10.49 $10.66 $10.80
- --------------------------------------------------------------------------------
R CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $5,327 $5,389 $5,456
- ------------------------------------
Shares outstanding 508 506 505
- ------------------------------------
Net asset value per share $10.49 $10.65 $10.80
- --------------------------------------------------------------------------------
See Notes to Financial Statements. (continued)
- ------
21
Statement of Assets and Liabilities
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------
2045 INCOME
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investment securities in affiliates, at value
(cost of $8,853,145 and $8,813,750, respectively) $9,036,208 $8,843,939
- --------------------------------------------------
Cash 594 1,045
- --------------------------------------------------
Distributions receivable from affiliates 3,392 11,453
- --------------------------------------------------------------------------------
9,040,194 8,856,437
- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Accrued administrative fees 503 951
- --------------------------------------------------
Service and distribution fees payable 4 3
- --------------------------------------------------------------------------------
507 954
- --------------------------------------------------------------------------------
NET ASSETS $9,039,687 $8,855,483
================================================================================
NET ASSETS CONSIST OF:
- --------------------------------------------------------------------------------
Capital (par value and paid-in surplus) $8,807,271 $8,800,746
- --------------------------------------------------
Accumulated net investment loss (1,348) (5,760)
- --------------------------------------------------
Undistributed net realized gain
on investment transactions 50,701 30,308
- --------------------------------------------------
Net unrealized appreciation on investments 183,063 30,189
- --------------------------------------------------------------------------------
$9,039,687 $8,855,483
================================================================================
INVESTOR CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $3,437,223 $6,079,422
- --------------------------------------------------
Shares outstanding 316,300 590,158
- --------------------------------------------------
Net asset value per share $10.87 $10.30
- --------------------------------------------------------------------------------
INSTITUTIONAL CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $5,591,475 $2,765,577
- --------------------------------------------------
Shares outstanding 514,375 268,406
- --------------------------------------------------
Net asset value per share $10.87 $10.30
- --------------------------------------------------------------------------------
ADVISOR CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $5,496 $5,245
- --------------------------------------------------
Shares outstanding 506 509
- --------------------------------------------------
Net asset value per share $10.86 $10.30
- --------------------------------------------------------------------------------
R CLASS, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Net assets $5,493 $5,239
- --------------------------------------------------
Shares outstanding 506 509
- --------------------------------------------------
Net asset value per share $10.86 $10.29
- --------------------------------------------------------------------------------
See Notes to Financial Statements.
- ------
22
Statement of Operations
FOR THE PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
2015 2025 2035
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
INCOME:
- ------------------------------------
Income distributions from
underlying funds -- affiliates $143,811 $253,410 $ 53,120
- --------------------------------------------------------------------------------
EXPENSES:
- ------------------------------------
Administrative fees 4,995 6,023 2,219
- ------------------------------------
Service and distribution fees:
- ------------------------------------
Advisor Class 6 6 6
- ------------------------------------
R Class 11 11 11
- ------------------------------------
Directors' fees and expenses 22 46 10
- --------------------------------------------------------------------------------
5,034 6,086 2,246
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME 138,777 247,324 50,874
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON AFFILIATES
- --------------------------------------------------------------------------------
NET REALIZED GAIN (LOSS) ON:
- ------------------------------------
Sale of investment in
underlying funds -- (491) (2,331)
- ------------------------------------
Capital gain distributions received
from underlying funds 60,764 127,291 31,740
- --------------------------------------------------------------------------------
60,764 126,800 29,409
- --------------------------------------------------------------------------------
CHANGE IN NET UNREALIZED
APPRECIATION ON INVESTMENTS 67,115 298,239 110,044
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN 127,879 425,039 139,453
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $266,656 $672,363 $190,327
================================================================================
*August 31, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements. (continued)
- ------
23
Statement of Operations
FOR THE PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
2045 INCOME
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
INCOME:
- --------------------------------------------------
Income distributions from
underlying funds -- affiliates $ 78,955 $ 91,576
- --------------------------------------------------------------------------------
EXPENSES:
- --------------------------------------------------
Administrative fees 832 2,455
- --------------------------------------------------
Service and distribution fees:
- --------------------------------------------------
Advisor Class 6 5
- --------------------------------------------------
R Class 11 11
- --------------------------------------------------
Directors' fees and expenses 15 14
- --------------------------------------------------------------------------------
864 2,485
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME 78,091 89,091
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON AFFILIATES
- --------------------------------------------------------------------------------
NET REALIZED GAIN (LOSS) ON:
- --------------------------------------------------
Sale of investment in underlying funds (1,814) (1,263)
- --------------------------------------------------
Capital gain distributions received
from underlying funds 52,515 31,571
- --------------------------------------------------------------------------------
50,701 30,308
- --------------------------------------------------------------------------------
CHANGE IN NET UNREALIZED
APPRECIATION ON INVESTMENTS 183,063 30,189
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN 233,764 60,497
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $311,855 $149,588
================================================================================
*August 31, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements.
- ------
24
Statement of Changes in Net Assets
PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
INCREASE IN NET ASSETS 2015 2025 2035
- --------------------------------------------------------------------------------
OPERATIONS
- --------------------------------------------------------------------------------
Net investment income $ 138,777 $ 247,324 $ 50,874
- --------------------------------------
Net realized gain 60,764 126,800 29,409
- --------------------------------------
Change in net unrealized appreciation 67,115 298,239 110,044
- --------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 266,656 672,363 190,327
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
- --------------------------------------------------------------------------------
From net investment income:
- --------------------------------------
Investor Class (151,449) (95,759) (47,246)
- --------------------------------------
Institutional Class (14,925) (149,519) (5,110)
- --------------------------------------
Advisor Class (86) (66) (63)
- --------------------------------------
R Class (82) (62) (59)
- --------------------------------------------------------------------------------
Decrease in net assets
from distributions (166,542) (245,406) (52,478)
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
- --------------------------------------------------------------------------------
Net increase in net assets from
capital share transactions 16,397,611 37,273,669 7,774,077
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS 16,497,725 37,700,626 7,911,926
NET ASSETS
- --------------------------------------------------------------------------------
Beginning of period -- -- --
- --------------------------------------------------------------------------------
End of period $16,497,725 $37,700,626 $7,911,926
================================================================================
Accumulated undistributed net
investment income (loss) $(27,765) $1,918 $(1,604)
================================================================================
*August 31, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements. (continued)
- ------
25
Statement of Changes in Net Assets
PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
INCREASE IN NET ASSETS 2045 INCOME
- --------------------------------------------------------------------------------
OPERATIONS
- --------------------------------------------------------------------------------
Net investment income $ 78,091 $ 89,091
- --------------------------------------------------
Net realized gain 50,701 30,308
- --------------------------------------------------
Change in net unrealized appreciation 183,063 30,189
- --------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 311,855 149,588
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
- --------------------------------------------------------------------------------
From net investment income:
- --------------------------------------------------
Investor Class (11,611) (67,418)
- --------------------------------------------------
Institutional Class (67,702) (27,244)
- --------------------------------------------------
Advisor Class (65) (96)
- --------------------------------------------------
R Class (61) (93)
- --------------------------------------------------------------------------------
Decrease in net assets from distributions (79,439) (94,851)
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
- --------------------------------------------------------------------------------
Net increase in net assets from
capital share transactions 8,807,271 8,800,746
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS 9,039,687 8,855,483
NET ASSETS
- --------------------------------------------------------------------------------
Beginning of period -- --
- --------------------------------------------------------------------------------
End of period $9,039,687 $8,855,483
================================================================================
Accumulated net investment loss $(1,348) $(5,760)
================================================================================
*August 31, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements.
- ------
26
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION -- American Century Asset Allocation Portfolios, Inc. (the
corporation) is registered under the Investment Company Act of 1940 (the 1940
Act), as amended, as an open-end management investment company. My Retirement
2015 Portfolio (2015), My Retirement 2025 Portfolio (2025), My Retirement 2035
Portfolio (2035), My Retirement 2045 Portfolio (2045), and My Retirement Income
Portfolio (Income) (collectively, the funds) are five funds in a series issued
by the corporation. The funds operate as "fund of funds," meaning that
substantially all of the funds' assets will be invested in other funds in the
American Century family of funds (the underlying funds). Because the funds
directly invest in a relatively small number of underlying funds, they are not
diversified as defined in the 1940 Act. However, the underlying funds are
generally diversified and so indirectly provide broad exposure to a large number
of securities. The funds' (except for Income) investment objectives are to seek
the highest total return consistent with their respective asset mix. The
investment objective of Income is to seek current income. Capital appreciation
is a secondary objective of Income. The funds pursue their objectives by
investing in underlying funds that represent a variety of asset classes and
investment styles. For each fund with a target year, the target asset mix will
be adjusted annually in a step-like fashion. In general, as the target year
approaches, the allocation to stocks will decrease and the allocation to bonds
and money market instruments will increase. When a fund reaches its most
conservative planned target asset allocation, which is expected to occur on
approximately November 30 of the year before the target year, its target asset
mix will become fixed and will match that of Income. The funds incepted on
August 31, 2004. The following is a summary of the funds' significant accounting
policies.
MULTIPLE CLASS -- The funds are authorized to issue the Investor Class,
Institutional Class, Advisor Class and R Class. The share classes differ
principally in their respective shareholder servicing and distribution expenses
and arrangements. All shares of each fund represent an equal pro rata interest
in the net assets of the class to which such shares belong, and have identical
voting, dividend, liquidation and other rights and the same terms and
conditions, except for class specific expenses and exclusive rights to vote on
matters affecting only individual classes. Income, non-class specific expenses,
realized and unrealized capital gains and losses of the funds are allocated to
each class of shares based on their relative net assets.
UNDERLYING FUNDS -- Each fund's assets are allocated among underlying funds that
represent major asset classes, including equity securities (stocks),
fixed-income securities (bonds) and cash-equivalent instruments (money markets),
based on each fund's target allocation. A brief description of each of the
underlying funds follows.
DOMESTIC EQUITY FUNDS
ULTRA seeks long-term capital growth. It uses a growth investment strategy and
generally invests in larger U.S. companies.
EQUITY GROWTH seeks long-term capital growth. It uses a quantitative investment
strategy to construct an optimized portfolio drawn primarily from the 1,500
largest publicly traded U.S. companies without regard to dividend yield.
INCOME & GROWTH seeks long-term capital growth with income as a secondary
objective. It uses a quantitative investment strategy to construct an optimized
portfolio drawn primarily from the 1,500 largest publicly traded U.S. companies.
Income & Growth's managers also attempt to create a dividend yield for the fund
that exceeds that of the S&P 500 Index.
LARGE COMPANY VALUE seeks long-term capital growth with income as a secondary
objective. It uses a value investment strategy and invests primarily in larger
U.S. companies.
VISTA seeks long-term capital growth. It uses a growth investment strategy and
generally invests in medium-sized and smaller U.S. companies.
VALUE seeks long-term capital growth with income as a secondary objective. It
uses a value investment strategy and invests primarily in U.S. companies of all
sizes.
SMALL COMPANY seeks long-term capital growth. It uses a quantitative investment
strategy and invests primarily in smaller U.S. companies.
REAL ESTATE seeks long-term capital appreciation with income as a secondary
objective. It invests primarily in equity securities issued by real estate
investment trusts and companies engaged in the real estate industry.
INTERNATIONAL EQUITY FUNDS
INTERNATIONAL GROWTH seeks capital growth. It uses a growth investment strategy
and invests primarily in securities of companies located in developed countries
other than the United States.
EMERGING MARKETS seeks capital growth. It uses a growth investment strategy and
invests primarily in securities of companies located in emerging
(continued)
- ------
27
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
market countries and companies that derive a significant portion of their
business from emerging market countries.
DOMESTIC FIXED INCOME FUNDS
DIVERSIFIED BOND seeks a high level of income by investing primarily in high-
and medium-grade non-money market debt securities. These securities, which may
be payable in U.S. or foreign currencies, may include corporate bonds and notes,
government securities and securities backed by mortgages or other assets.
HIGH-YIELD seeks high current income by investing in a diversified portfolio of
high-yield corporate bonds and other debt securities.
INFLATION-ADJUSTED BOND seeks to provide total return and inflation protection
consistent with investment in inflation-indexed securities.
INTERNATIONAL FIXED INCOME FUNDS
INTERNATIONAL BOND seeks high total return by investing in high-quality,
non-dollar-denominated government and corporate debt securities outside the
United States.
MONEY MARKET FUNDS
PREMIUM MONEY MARKET seeks to earn the highest level of current income while
preserving the value of shareholder investments by investing in high-quality,
cash-equivalent securities.
SECURITY VALUATIONS -- Investments in the underlying funds are valued at their
reported net asset value. The underlying funds have specific valuation policies.
If the underlying funds determine that the market price of a security is not
readily available, or that the specific valuation methods do not reflect the
security's fair value, such security is valued at its fair value as determined
by, or in accordance with procedures adopted by, the Board of Directors or its
designee if such fair value determination would materially impact an underlying
fund's net asset value.
SECURITY TRANSACTIONS -- Security transactions are accounted for as of trade
date. Net realized gains and losses are determined on the identified cost basis,
which is also used for federal income tax purposes.
INVESTMENT INCOME -- Income and capital gains distributions, if any, from the
underlying funds are recorded as of ex-dividend date. Long-term capital gain
distributions, if any, from the underlying funds are a component of realized
gain (loss).
EXPENSES -- The expenses included in the accompanying financial statements
reflect the expenses of each fund and do not include any expenses associated
with the underlying funds.
INCOME TAX STATUS -- It is each fund's policy to distribute substantially all
net investment income and net realized gains to shareholders and otherwise
qualify as a regulated investment company under provisions of the Internal
Revenue Code. Accordingly, no provision has been made for federal or state
income taxes.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions to shareholders are recorded on
the ex-dividend date. Distributions from net investment income, if any, are
generally declared and paid annually for 2015, 2025, 2035, and 2045.
Distributions from net investment income, if any, are generally declared and
paid quarterly for Income. Distributions from net realized gains, if any, are
generally declared and paid annually for all funds.
USE OF ESTIMATES -- The financial statements are prepared in conformity with
accounting principles generally accepted in the United States of America, which
may require management to make certain estimates and assumptions at the date of
the financial statements. Actual results could differ from these estimates.
2. FEES AND TRANSACTIONS WITH RELATED PARTIES
ADMINISTRATIVE FEES -- The corporation has entered into a Management Agreement
with American Century Investment Management, Inc. (ACIM), under which ACIM
provides the funds with shareholder services in exchange for an administrative
fee (the fee). The fee is computed and accrued daily based on the daily net
assets of each specific class of shares of each fund and paid monthly in
arrears. The rate of the fee for the Investor, Advisor and R Classes of the
funds is 0.20%. There is no administrative fee for the Institutional Class.
DISTRIBUTION FEES -- The Board of Directors of the corporation has adopted a
separate Master Distribution and Individual Shareholder Services
(continued)
- ------
28
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
2. FEES AND TRANSACTIONS WITH RELATED PARTIES (CONTINUED)
Plan for the Advisor and R Classes (collectively, the plans), pursuant to Rule
12b-1 of the 1940 Act. The plans provide that the Advisor Class and R Class will
pay American Century Investments Services, Inc. (ACIS) 0.25% and 0.50%,
respectively. The fees are computed and accrued daily based on each class's
daily net assets and paid monthly in arrears. These fees are used to pay for
distribution services and shareholder services. Fees incurred under the plans
during the period ended January 31, 2005, are detailed in the Statement of
Operations.
MANAGEMENT FEES -- Each fund also will indirectly realize its pro rata share of
the fees and expenses of the underlying funds in which it invests. These fees
and expenses are already reflected in the valuation of the underlying funds.
RELATED PARTIES -- Certain officers and directors of the corporation are also
officers and/or directors, and, as a group, controlling stockholders of American
Century Companies, Inc. (ACC), the parent of the corporation's investment
advisor, ACIM, the distributor of the corporation, ACIS, and the corporation's
transfer agent, American Century Services, LLC. The directors of the corporation
are also directors of some underlying funds and therefore those underlying funds
may be deemed to be under common control with the corporation. The officers of
the corporation are also officers of all the underlying funds. ACIM or American
Century Global Investment Management, Inc., a wholly-owned subsidiary of ACIM,
serves as the investment advisor for the underlying funds.
3. INVESTMENT TRANSACTIONS
Investment transactions, excluding short-term investments, for the period ended
January 31, 2005, were as follows:
- --------------------------------------------------------------------------------
2015 2025 2035 2045 INCOME
- --------------------------------------------------------------------------------
Purchases $16,414,043 $37,442,871 $7,912,509 $9,037,967 $8,917,944
- --------------------------------------------------------------------------------
Proceeds
from sales -- $70,870 $117,066 $183,008 $102,931
- --------------------------------------------------------------------------------
4. CAPITAL SHARE TRANSACTIONS
The corporation is authorized to issue 3,000,000,000 shares. Transactions in
shares of the funds were as follows:
- --------------------------------------------------------------------------------
2015 2025
- --------------------------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT
- --------------------------------------------------------------------------------
INVESTOR CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 1,412,203 $14,714,307 2,026,052 $21,450,717
- -------------------------
Issued in reinvestment
of distributions 14,145 148,666 8,808 93,984
- -------------------------
Redeemed (27,993) (294,308) (37,158) (394,462)
- --------------------------------------------------------------------------------
Net increase 1,398,355 $14,568,665 1,997,702 $21,150,239
================================================================================
INSTITUTIONAL CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 176,753 $1,864,427 1,563,348 $16,391,693
- -------------------------
Issued in reinvestment
of distributions 1,419 14,925 14,013 149,519
- -------------------------
Redeemed (6,746) (70,582) (40,520) (432,901)
- --------------------------------------------------------------------------------
Net increase 171,426 $1,808,770 1,536,841 $16,108,311
================================================================================
(1) August 31, 2004 (fund inception) through January 31, 2005.
(continued)
- ------
29
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
4. CAPITAL SHARE TRANSACTIONS (CONTINUED)
- --------------------------------------------------------------------------------
2015 2025
- --------------------------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT
- --------------------------------------------------------------------------------
ADVISOR CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 1,460 $15,005 974 $ 9,995
- -------------------------
Issued in reinvestment
of distributions 8 86 6 66
- --------------------------------------------------------------------------------
Net increase 1,468 $15,091 980 $10,061
================================================================================
R CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 500 $5,003 500 $4,996
- -------------------------
Issued in reinvestment
of distributions 8 82 6 62
- --------------------------------------------------------------------------------
Net increase 508 $5,085 506 $5,058
================================================================================
- --------------------------------------------------------------------------------
2035 2045
- --------------------------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT
- --------------------------------------------------------------------------------
INVESTOR CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 633,506 $6,709,557 322,245 $3,490,609
- -------------------------
Issued in reinvestment
of distributions 4,053 43,813 1,055 11,489
- -------------------------
Redeemed (38,017) (408,633) (7,000) (72,597)
- --------------------------------------------------------------------------------
Net increase 599,542 $6,344,737 316,300 $3,429,501
================================================================================
INSTITUTIONAL CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 132,524 $1,426,779 531,250 $5,551,068
- -------------------------
Issued in reinvestment
of distributions 473 5,110 6,217 67,702
- -------------------------
Redeemed (1,182) (12,667) (23,092) (251,132)
- --------------------------------------------------------------------------------
Net increase 131,815 $1,419,222 514,375 $5,367,638
================================================================================
ADVISOR CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 500 $4,998 500 $5,003
- -------------------------
Issued in reinvestment
of distributions 6 63 6 65
- --------------------------------------------------------------------------------
Net increase 506 $5,061 506 $5,068
================================================================================
R CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED
JANUARY 31, 2005(1)
- -------------------------
Sold 500 $4,998 500 $5,003
- -------------------------
Issued in reinvestment
of distributions 5 59 6 61
- --------------------------------------------------------------------------------
Net increase 505 $5,057 506 $5,064
================================================================================
(1) August 31, 2004 (fund inception) through January 31, 2005.
(continued)
- ------
30
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
4. CAPITAL SHARE TRANSACTIONS (CONTINUED)
- --------------------------------------------------------------------------------
INCOME
- --------------------------------------------------------------------------------
SHARES AMOUNT
- --------------------------------------------------------------------------------
INVESTOR CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED JANUARY 31, 2005(1)
- ---------------------------------------------------
Sold 622,504 $6,373,989
- ---------------------------------------------------
Issued in reinvestment of distributions 6,432 66,384
- ---------------------------------------------------
Redeemed (38,778) (398,518)
- --------------------------------------------------------------------------------
Net increase 590,158 $6,041,855
================================================================================
INSTITUTIONAL CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED JANUARY 31, 2005(1)
- ---------------------------------------------------
Sold 278,293 $2,850,962
- ---------------------------------------------------
Issued in reinvestment of distributions 2,637 27,244
- ---------------------------------------------------
Redeemed (12,524) (129,502)
- --------------------------------------------------------------------------------
Net increase 268,406 $2,748,704
================================================================================
ADVISOR CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED JANUARY 31, 2005(1)
- ---------------------------------------------------
Sold 500 $4,999
- ---------------------------------------------------
Issued in reinvestment of distributions 9 96
- --------------------------------------------------------------------------------
Net increase 509 $5,095
================================================================================
R CLASS
- --------------------------------------------------------------------------------
PERIOD ENDED JANUARY 31, 2005(1)
- ---------------------------------------------------
Sold 500 $4,999
- ---------------------------------------------------
Issued in reinvestment of distributions 9 93
- --------------------------------------------------------------------------------
Net increase 509 $5,092
================================================================================
(1) August 31, 2004 (fund inception) through January 31, 2005.
(continued)
- ------
31
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
5. FEDERAL TAX INFORMATION
The character of distributions made during the year from net investment income
or net realized gains may differ from their ultimate characterization for
federal income tax purposes. These differences reflect the differing character
of certain income items and net realized gains and losses for financial
statement and tax purposes, and may result in reclassification among certain
capital accounts on the financial statements.
As of January 31, 2005, the federal tax cost of investments was as follows:
- ------------------------------------------------------------------------------------------
2015 2025 2035 2045 INCOME
- ------------------------------------------------------------------------------------------
Federal tax cost
of investments $16,414,043 $37,372,023 $7,795,468 $8,854,493 $8,814,641
==========================================================================================
Gross tax appreciation
of investments $163,023 $ 519,104 $152,075 $255,251 $ 78,191
- ----------------------
Gross tax depreciation
of investments (95,908) (221,378) (44,387) (73,536) (48,893)
- ------------------------------------------------------------------------------------------
Net tax appreciation
of investments $ 67,115 $ 297,726 $107,688 $181,715 $ 29,298
==========================================================================================
The difference between book-basis and tax-basis cost and unrealized appreciation
(depreciation) is attributable primarily to the tax deferral of losses on wash
sales. The cost of investments for federal income tax purposes was the same as
the cost for financial statement purposes for 2015.
6. OTHER INFORMATION
The funds do not invest in the underlying funds for the purpose of exercising
management or control; however, investments by the funds within their investment
strategies may represent a significant portion of the underlying funds net
assets.
As of January 31, 2005, the funds did not own a significant percentage of total
outstanding shares of the underlying funds.
- ------
32
My Retirement 2015 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INVESTOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.22
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.46
- --------------------------------------------------------------------------------
Total From Investment Operations 0.68
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.18)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.50
================================================================================
TOTAL RETURN(3) 6.80%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.20%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 5.07%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 0%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $14,677
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
33
My Retirement 2015 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INSTITUTIONAL
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.26
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.43
- --------------------------------------------------------------------------------
Total From Instestment Operations 0.69
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.19)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.50
================================================================================
TOTAL RETURN(3) 6.85%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 5.27%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 0%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $1,800
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
34
My Retirement 2015 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
ADVISOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.17
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.49
- --------------------------------------------------------------------------------
Total From Investment Operations 0.66
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.17)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.49
================================================================================
TOTAL RETURN(3) 6.62%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.45%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.82%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 0%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $15
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
35
My Retirement 2015 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
R
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.17
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.48
- --------------------------------------------------------------------------------
Total From Investment Operations 0.65
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.16)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.49
================================================================================
TOTAL RETURN(3) 6.53%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.70%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.57%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 0%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
36
My Retirement 2025 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INVESTOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.15
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.65
- --------------------------------------------------------------------------------
Total From Investment Operations 0.80
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.14)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.66
================================================================================
TOTAL RETURN(3) 8.00%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.20%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.01%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 1%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $21,297
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
37
My Retirement 2025 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INSTITUTIONAL
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.21
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.60
- --------------------------------------------------------------------------------
Total From Investment Operations 0.81
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.15)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.66
================================================================================
TOTAL RETURN(3) 8.06%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.21%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 1%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $16,388
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
38
My Retirement 2025 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
ADVISOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.14
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.65
- --------------------------------------------------------------------------------
Total From Investment Operations 0.79
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.13)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.66
================================================================================
TOTAL RETURN(3) 7.91%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.45%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 3.76%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 1%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $10
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
39
My Retirement 2025 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
R
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.14
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.63
- --------------------------------------------------------------------------------
Total From Investment Operations 0.77
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.12)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.65
================================================================================
TOTAL RETURN(3) 7.74%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.70%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 3.51%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 1%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
40
My Retirement 2035 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INVESTOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.19
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.74
- --------------------------------------------------------------------------------
Total From Investment Operations 0.93
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.13)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.80
================================================================================
TOTAL RETURN(3) 9.33%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.20%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.15%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 4%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $6,477
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
41
My Retirement 2035 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INSTITUTIONAL
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.19
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.76
- --------------------------------------------------------------------------------
Total From Investment Operations 0.95
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.14)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.81
================================================================================
TOTAL RETURN(3) 9.50%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.35%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 4%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $1,424
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
42
My Retirement 2035 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
ADVISOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.14
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.79
- --------------------------------------------------------------------------------
Total From Investment Operations 0.93
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.13)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.80
================================================================================
TOTAL RETURN(3) 9.25%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.45%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 3.90%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 4%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
43
My Retirement 2035 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
R
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.13
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.79
- --------------------------------------------------------------------------------
Total From Investment Operations 0.92
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.12)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.80
================================================================================
TOTAL RETURN(3) 9.17%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.70%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 3.65%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 4%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
44
My Retirement 2045 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INVESTOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.15
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.86
- --------------------------------------------------------------------------------
Total From Investment Operations 1.01
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.14)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.87
================================================================================
TOTAL RETURN(3) 10.07%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.20%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.44%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 5%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $3,437
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
45
My Retirement 2045 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INSTITUTIONAL
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.23
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.78
- --------------------------------------------------------------------------------
Total From Investment Operations 1.01
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.14)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.87
================================================================================
TOTAL RETURN(3) 10.12%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.64%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 5%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5,591
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
46
My Retirement 2045 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
ADVISOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.14
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.85
- --------------------------------------------------------------------------------
Total From Investment Operations 0.99
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.13)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.86
================================================================================
TOTAL RETURN(3) 9.89%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.45%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.19%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 5%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
47
My Retirement 2045 Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
R
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.13
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.85
- --------------------------------------------------------------------------------
Total From Investment Operations 0.98
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.12)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.86
================================================================================
TOTAL RETURN(3) 9.81%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.70%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 3.94%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 5%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
48
My Retirement Income Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INVESTOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.22
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.28
- --------------------------------------------------------------------------------
Total From Investment Operations 0.50
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.20)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.30
================================================================================
TOTAL RETURN(3) 5.00%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.20%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 5.31%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 3%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $6,079
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
49
My Retirement Income Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
INSTITUTIONAL
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.25
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.26
- --------------------------------------------------------------------------------
Total From Investment Operations 0.51
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.21)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.30
================================================================================
TOTAL RETURN(3) 5.06%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 5.51%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 3%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $2,766
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
50
My Retirement Income Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
ADVISOR
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.19
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.30
- --------------------------------------------------------------------------------
Total From Investment Operations 0.49
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.19)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.30
================================================================================
TOTAL RETURN(3) 4.92%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.45%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 5.06%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 3%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
51
My Retirement Income Portfolio - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
R
CLASS
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- --------------------------------------------------------
Net Investment Income(2) 0.18
- --------------------------------------------------------
Net Realized and Unrealized Gain 0.30
- --------------------------------------------------------------------------------
Total From Investment Operations 0.48
- --------------------------------------------------------------------------------
Distributions
- --------------------------------------------------------
From Net Investment Income (0.19)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.29
================================================================================
TOTAL RETURN(3) 4.75%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.70%(4)
- --------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.81%(4)
- --------------------------------------------------------
Portfolio Turnover Rate 3%
- --------------------------------------------------------
Net Assets, End of Period (in thousands) $5
- --------------------------------------------------------------------------------
(1) August 31, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized. The total return of the classes may not precisely reflect the
class expense differences because of the impact of calculating the net asset
values to two decimal places. If net asset values were calculated to three
decimal places, the total return differences would more closely reflect the
class expense differences. The calculation of net asset values to two
decimal places is made in accordance with SEC guidelines and does not result
in any gain or loss of value between one class and another.
(4) Annualized.
See Notes to Financial Statements.
- ------
52
Share Class Information
Four classes of shares are authorized for sale by the funds: Investor Class,
Institutional Class, Advisor Class and R Class. The total expense ratios of
Advisor and R Class shares are higher than that of Investor Class shares; the
total expense ratio of Institutional Class shares is lower than that of Investor
Class shares.
INVESTOR CLASS shares are available for purchase in two ways: 1) directly from
American Century without any commissions or other fees; or 2) through a
broker-dealer, which may require payment of a transaction fee to the broker.
INSTITUTIONAL CLASS shares are available to large investors such as endowments,
foundations, and retirement plans, and to financial intermediaries serving these
investors. This class recognizes the relatively lower cost of serving
institutional customers and others who invest at least $5 million ($3 million
for endowments and foundations) in an American Century fund or at least $10
million in multiple funds. In recognition of the larger investments and account
balances and comparatively lower transaction costs, the total expense ratio of
Institutional Class shares is 0.20% less than the total expense ratio of
Investor Class shares.
ADVISOR CLASS shares are sold primarily through institutions such as investment
advisors, banks, broker-dealers, insurance companies, and financial advisors.
Advisor Class shares are subject to a 0.25% annual Rule 12b-1 service and
distribution fee. The total expense ratio of Advisor Class shares is 0.25%
higher than the total expense ratio of Investor Class shares.
R CLASS shares are sold primarily through employer-sponsored retirement plans
and through institutions such as investment advisors, banks, broker-dealers, and
insurance companies. R Class shares are subject to a 0.50% annual Rule 12b-1
service and distribution fee.
All classes of shares represent a pro rata interest in the funds and generally
have the same rights and preferences.
- ------
53
Additional Information
RETIREMENT ACCOUNT INFORMATION
As required by law, any distributions you receive from an IRA or certain 403(b),
457 and qualified plans [those not eligible for rollover to an IRA or to another
qualified plan] are subject to federal income tax withholding, unless you elect
not to have withholding apply. Tax will be withheld on the total amount
withdrawn even though you may be receiving amounts that are not subject to
withholding, such as nondeductible contributions. In such case, excess amounts
of withholding could occur. You may adjust your withholding election so that a
greater or lesser amount will be withheld.
If you don't want us to withhold on this amount, you must notify us to not
withhold the federal income tax. Even if you plan to roll over the amount you
withdraw to another tax-deferred account, the withholding rate still applies to
the withdrawn amount unless we have received notice not to withhold federal
income tax prior to the withdrawal. You may notify us in writing or in certain
situations by telephone or through other electronic means. You have the right to
revoke your withholding election at any time and any election you make may
remain in effect until revoked by filing a new election.
Remember, even if you elect not to have income tax withheld, you are liable for
paying income tax on the taxable portion of your withdrawal. If you elect not to
have income tax withheld or you don't have enough income tax withheld, you may
be responsible for payment of estimated tax. You may incur penalties under the
estimated tax rules if your withholding and estimated tax payments are not
sufficient.
State tax will be withheld if, at the time of your distribution, your address is
within one of the mandatory withholding states and you have federal income tax
withheld. State taxes will be withheld from your distribution in accordance with
the respective state rules.
PROXY VOTING GUIDELINES
American Century Investment Management, Inc., the funds' investment advisor, is
responsible for exercising the voting rights associated with the securities
purchased and/or held by the funds. A description of the policies and procedures
the advisor uses in fulfilling this responsibility is available without charge,
upon request, by calling 1-800-345-2021. It is also available on American
Century's Web site at americancentury.com and on the Securities and Exchange
Commission's Web site at sec.gov. Because the funds had not commenced operations
as of the most recent 12-month period ended June 30, information regarding how
the investment advisor voted proxies is not available.
(continued)
- ------
54
Additional Information
QUARTERLY PORTFOLIO DISCLOSURE
The funds file their complete schedule of portfolio holdings with the Securities
and Exchange Commission (SEC) for the first and third quarters of each fiscal
year on Form N-Q. The funds' Forms N-Q are available on the SEC's Web site at
sec.gov, and may be reviewed and copied at the SEC's Public Reference Room in
Washington, DC. Information on the operation of the Public Reference Room may be
obtained by calling 1-800-SEC-0330. The funds also make their complete schedule
of portfolio holdings for the most recent quarter of their fiscal year available
on their Web site at americancentury.com and, upon request, by calling
1-800-345-2021.
INDEX DEFINITIONS
The following indices are used to illustrate investment market, sector, or style
performance or to serve as fund performance comparisons. They are not investment
products available for purchase.
The LEHMAN BROTHERS U.S. AGGREGATE INDEX represents securities that are taxable,
registered with the Securities and Exchange Commission, and U.S.
dollar-denominated. The index covers the U.S. investment-grade fixed-rate bond
market, with index components for government and corporate securities, mortgage
pass-through securities, and asset-backed securities.
The RUSSELL 3000(reg.tm) INDEX measures the performance of the 3,000 largest
U.S. companies based on total market capitalization, which represents
approximately 98% of the investable U.S. equity market. As of the latest
reconstitution, the average market capitalization was approximately $4 billion;
the median market capitalization was approximately $700 million. The index had a
total market capitalization range of approximately $309 billion to $128 million.
- ------
55
Notes
- ------
56
[inside back cover - blank]
[back cover]
CONTACT US
AMERICANCENTURY.COM
AUTOMATED INFORMATION LINE:
1-800-345-8765
INVESTOR SERVICES REPRESENTATIVE:
1-800-345-2021 or 816-531-5575
BUSINESS, NOT-FOR-PROFIT,
EMPLOYER-SPONSORED RETIREMENT PLANS:
1-800-345-3533
BANKS AND TRUST COMPANIES, BROKER-DEALERS,
FINANCIAL ADVISORS, INSURANCE COMPANIES:
1-800-345-6488
TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-634-4113 or 816-444-3485
AMERICAN CENTURY ASSET ALLOCATION PORTFOLIOS, INC.
INVESTMENT MANAGER:
American Century Investment Management, Inc.
Kansas City, Missouri
THIS REPORT AND THE STATEMENTS IT CONTAINS ARE SUBMITTED FOR THE GENERAL
INFORMATION OF OUR SHAREHOLDERS. THE REPORT IS NOT AUTHORIZED FOR DISTRIBUTION
TO PROSPECTIVE INVESTORS UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE
PROSPECTUS.
The American Century Investments logo, American Century and American Century
Investments are service marks of American Century Proprietary Holdings, Inc.
American Century Investment Services, Inc., Distributor
0503 (c)2005 American Century Proprietary Holdings, Inc.
SH-SAN-42276N All rights reserved.
[front cover]
American Century Investments
SEMIANNUAL REPORT
[photo of man and woman]
JANUARY 31, 2005
One Choice Portfolio: Very Conservative
One Choice Portfolio: Conservative
One Choice Portfolio: Moderate
One Choice Portfolio: Aggressive
One Choice Portfolio: Very Aggressive
[american century investments logo and text logo]
Table of Contents
Our Message to You . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ONE CHOICE PORTFOLIO: VERY CONSERVATIVE
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . . 3
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
ONE CHOICE PORTFOLIO: CONSERVATIVE
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . . 6
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
ONE CHOICE PORTFOLIO: MODERATE
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . . 9
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ONE CHOICE PORTFOLIO: AGGRESSIVE
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . .12
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ONE CHOICE PORTFOLIO: VERY AGGRESSIVE
Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Portfolio Commentary . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
Types of Investments in Portfolio . . . . . . . . . . . . . . . . . . . . .15
Schedule of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Shareholder Fee Examples . . . . . . . . . . . . . . . . . . . . . . . . . . .17
FINANCIAL STATEMENTS
Statement of Assets and Liabilities . . . . . . . . . . . . . . . . . . . . . 19
Statement of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Statement of Changes in Net Assets . . . . . . . . . . . . . . . . . . . . . .23
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . 25
Financial Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
OTHER INFORMATION
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
The opinions expressed in each of the Portfolio Commentaries reflect those of
the portfolio management team as of the date of the report, and do not
necessarily represent the opinions of American Century or any other person in
the American Century organization. Any such opinions are subject to change at
any time based upon market or other conditions and American Century disclaims
any responsibility to update such opinions. These opinions may not be relied
upon as investment advice and, because investment decisions made by American
Century funds are based on numerous factors, may not be relied upon as an
indication of trading intent on behalf of any American Century fund. Security
examples are used for representational purposes only and are not intended as
recommendations to purchase or sell securities. Performance information for
comparative indices and securities is provided to American Century by third
party vendors. To the best of American Century's knowledge, such information is
accurate at the time of printing.
Our Message
[photo of James E. Stowers III and James E. Stowers, Jr.]
JAMES E. STOWERS III WITH JAMES E. STOWERS, JR.
We are pleased to provide you with the semiannual report for the One Choice
Portfolios for the period ended January 31, 2005.
This report contains information that can help you monitor your investment.
You'll find details about your fund's return and holdings as well as data and
analysis that provide insight into the market conditions affecting the fund's
performance.
Through our Web site, americancentury.com, we provide the views of our senior
investment officers, and other communications about investments, portfolio
strategy, and the markets. We also have many informative resources available in
the Education & Planning section of our site to help you with your investment
strategy.
Your next shareholder report for these funds will be the annual report dated
July 31, 2005, available in approximately six months.
As always, we deeply appreciate your investment with American Century
Investments.
Sincerely,
/s/James E. Stowers, Jr.
James E. Stowers, Jr.
FOUNDER
/s/James E. Stowers III
James E. Stowers III
CHAIRMAN OF THE BOARD
- ------
1
One Choice Portfolio: Very Conservative - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 3.35% 9/30/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 7.22% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.59% --
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
2
One Choice Portfolio: Very Conservative - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on September 30, 2004, through January 31, 2005, One Choice
Portfolio: Very Conservative returned 3.35%. This return reflected the positive
performance of the portfolio's fixed-income, equity, and money market
components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the four months
covered by this report. Bonds produced modest gains; the Lehman Brothers U.S.
Aggregate Index, a broad bond market measure, returned 1.59%. The best
performers were corporate bonds and mortgage-backed securities. Foreign bonds
outpaced the domestic market.
The stock market registered solid gains during the four-month period, with the
broad Russell 3000 Index returning 7.22%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small- and mid-cap stocks outperformed large-cap issues, while growth and value
stocks were mixed--value surpassed growth among large-cap stocks, while growth
came out ahead in the small- and mid-cap segments of the market.
Money market rates increased as the Federal Reserve raised short-term interest
rates twice during the period, boosting the three-month Treasury bill yield from
1.71% to 2.51%.
PORTFOLIO STRATEGY
One Choice Portfolio: Very Conservative seeks the highest total return
consistent with its neutral asset mix of 50% bonds, 25% stocks, and 25% cash
equivalents. The portfolio is a "fund of funds," which means it invests in other
American Century mutual funds to achieve its investment objective and neutral
asset mix. (See the following page for a list of the underlying funds in the
portfolio.)
The portfolio's neutral asset mix, which features a diversified blend of asset
classes and investment styles, generally represents its long-term asset
allocation strategy. However, we may make adjustments to the neutral asset mix
to take advantage of opportunities that we believe will help the portfolio
better meet its investment objective.
Although this portfolio is expected to have the least short-term price
volatility of the One Choice Portfolios, it nonetheless entails some risks,
including those associated with investing in bonds, stocks, and foreign
securities.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 40.4%
- --------------------------------------------------------------------------------
International Fixed Income Funds 9.9%
- --------------------------------------------------------------------------------
TOTAL FIXED INCOME EXPOSURE 50.3%
- --------------------------------------------------------------------------------
Money Market Funds 25.1%
- --------------------------------------------------------------------------------
Domestic Equity Funds 24.6%
- --------------------------------------------------------------------------------
- ------
3
One Choice Portfolio: Very Conservative - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- -----------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST GAIN (LOSS) RECEIVED(1) VALUE
- -----------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.8%
- -----------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 40.2%
- ----------------------------------------
158,587 Diversified Bond Fund
Investor Class $1,711,386 $ 82,015 $ (750) $18,616 $1,627,103
- -----------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 25.1%
- ----------------------------------------
1,013,283 Prime Money Market Fund
Investor Class 1,064,058 50,776 -- 2,724 1,013,283
- -----------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 24.6%
- ----------------------------------------
9,223 Equity Growth Fund
Investor Class 208,761 14,064 (238) 588 199,770
- ----------------------------------------
5,164 Growth Fund
Investor Class 104,129 6,689 (85) 29 98,891
- ----------------------------------------
50,169 Large Company Value Fund
Investor Class 366,205 54,804 (34) 2,032 318,572
- ----------------------------------------
3,341 Real Estate Fund
Investor Class 82,952 2,206 (110) -- 76,342
- ----------------------------------------
4,059 Small Company Fund
Investor Class 41,494 1,081 (35) -- 40,671
- ----------------------------------------
27,530 Value Fund
Investor Class 240,457 34,381 (3,300) 16,240 199,593
- ----------------------------------------
4,167 Vista Fund
Investor Class(3) 93,648 38,144 444 -- 59,505
- -----------------------------------------------------------------------------------------------------------
1,137,646 151,369 (3,358) 18,889 993,344
- -----------------------------------------------------------------------------------------------------------
INTERNATIONAL FIXED INCOME FUNDS -- 9.9%
- ----------------------------------------
27,568 International Bond Fund
Investor Class 418,457 23,649 (472) 8,090 398,909
- -----------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.8%
(Cost $4,023,738) $4,331,547 $307,809 $(4,580) $48,319 4,032,639
- ----------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.2% 7,960
- ---------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $4,040,599
- ---------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period September 30, 2004 (fund inception) through January 31, 2005, is
shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
4
One Choice Portfolio: Conservative - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 4.78% 9/30/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 7.22% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.59% --
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
5
One Choice Portfolio: Conservative - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on September 30, 2004, through January 31, 2005, One Choice
Portfolio: Conservative returned 4.78%. This return reflected the positive
performance of the portfolio's fixed-income, equity, and money market
components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the four months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 7.22%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small- and mid-cap stocks outperformed large-cap issues, while growth and value
stocks were mixed--value surpassed growth among large-cap stocks, while growth
came out ahead in the small- and mid-cap segments of the market.
Bonds produced modest gains during the four-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.59%. The best
performers were corporate bonds and mortgage-backed securities.
Foreign stocks and bonds both outpaced their respective domestic markets.
Money market rates increased as the Federal Reserve raised short-term interest
rates twice during the period, boosting the three-month Treasury bill yield from
1.71% to 2.51%.
PORTFOLIO STRATEGY
One Choice Portfolio: Conservative seeks the highest total return consistent
with its neutral asset mix of 45% stocks, 45% bonds, and 10% cash equivalents.
The portfolio is a "fund of funds," which means it invests in other American
Century mutual funds to achieve its investment objective and neutral asset mix.
(See the following page for a list of the underlying funds in the portfolio.)
The portfolio's neutral asset mix, which features a diversified blend of asset
classes and investment styles, generally represents its long-term asset
allocation strategy. However, we may make adjustments to the neutral asset mix
to take advantage of opportunities that we believe will help the portfolio
better meet its investment objective.
An investment in One Choice Portfolio: Conservative entails some risks,
including those associated with investing in bonds, stocks, and foreign
securities. The value of the portfolio's shares will fluctuate over time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 37.4%
- --------------------------------------------------------------------------------
International Fixed Income Funds 7.9%
- --------------------------------------------------------------------------------
TOTAL FIXED INCOME EXPOSURE 45.3%
- --------------------------------------------------------------------------------
Domestic Equity Funds 38.7%
- --------------------------------------------------------------------------------
International Equity Funds 5.9%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 44.6%
- --------------------------------------------------------------------------------
Money Market Funds 10.1%
- --------------------------------------------------------------------------------
- ------
6
One Choice Portfolio: Conservative - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- -----------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST GAIN (LOSS) RECEIVED(1) VALUE
- -----------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.9%
- -----------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 38.6%
- ----------------------------------------
61,377 Equity Growth Fund
Investor Class $ 1,324,092 $ 25,530 $(136) $ 3,533 $ 1,329,426
- ----------------------------------------
36,307 Growth Fund
Investor Class 698,533 11,849 (73) 182 695,279
- ----------------------------------------
254,979 Large Company Value Fund
Investor Class 1,619,130 26,106 (24) 8,587 1,619,116
- ----------------------------------------
12,355 Real Estate Fund
Investor Class 298,887 -- -- -- 282,312
- ----------------------------------------
22,519 Small Company Fund
Investor Class 224,253 -- -- -- 225,640
- ----------------------------------------
137,439 Value Fund
Investor Class 1,071,454 28,372 (3,212) 76,733 996,433
- ----------------------------------------
41,452 Vista Fund
Investor Class(3) 666,323 103,891 (304) -- 591,935
- -----------------------------------------------------------------------------------------------------------
5,902,672 195,748 (3,749) 89,035 5,740,141
- -----------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 37.4%
- ----------------------------------------
541,181 Diversified Bond Fund
Investor Class 5,623,850 58,574 (846) 61,720 5,552,516
- -----------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 10.1%
- ----------------------------------------
1,495,543 Prime Money Market Fund
Investor Class 1,510,734 15,192 -- 3,600 1,495,543
- -----------------------------------------------------------------------------------------------------------
INTERNATIONAL FIXED INCOME FUNDS -- 7.9%
- ----------------------------------------
81,497 International Bond Fund
Investor Class 1,190,200 10,713 (78) 18,836 1,179,262
- -----------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 5.9%
- ----------------------------------------
99,752 International Growth Fund
Investor Class 1,091,133 242,932 3,979 7,266 881,808
- -----------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.9%
(Cost $14,795,430) $15,318,589 $523,159 $(694) $180,457 14,849,270
- ----------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.1% 21,397
- ---------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $14,870,667
- ---------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period September 30, 2004 (fund inception) through January 31, 2005, is
shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
7
One Choice Portfolio: Moderate - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 6.65% 9/30/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 7.22% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.59% --
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
8
One Choice Portfolio: Moderate - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on September 30, 2004, through January 31, 2005, One Choice
Portfolio: Moderate returned 6.65%. This return reflected the positive
performance of the portfolio's equity, fixed-income, and money market
components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the four months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 7.22%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small- and mid-cap stocks outperformed large-cap issues, while growth and value
stocks were mixed--value surpassed growth among large-cap stocks, while growth
came out ahead in the small- and mid-cap segments of the market.
Bonds produced modest gains during the four-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.59%. The best
performers were corporate bonds, particularly high-yield corporate bonds, and
mortgage-backed securities.
Foreign stocks and bonds both outpaced their respective domestic markets.
Money market rates increased as the Federal Reserve raised short-term interest
rates twice during the period, boosting the three-month Treasury bill yield from
1.71% to 2.51%.
PORTFOLIO STRATEGY
One Choice Portfolio: Moderate seeks the highest total return consistent with
its neutral asset mix of 63% stocks, 31% bonds, and 6% cash equivalents. The
portfolio is a "fund of funds," which means it invests in other American Century
mutual funds to achieve its investment objective and neutral asset mix. (See the
following page for a list of the underlying funds in the portfolio.)
The portfolio's neutral asset mix, which features a diversified blend of asset
classes and investment styles, generally represents its long-term asset
allocation strategy. However, we may make adjustments to the neutral asset mix
to take advantage of opportunities that we believe will help the portfolio
better meet its investment objective.
An investment in One Choice Portfolio: Moderate entails some risks, including
those associated with investing in stocks, bonds, and foreign securities. The
value of the portfolio's shares will fluctuate over time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Equity Funds 49.7%
- --------------------------------------------------------------------------------
International Equity Funds 14.0%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 63.7%
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 27.3%
- --------------------------------------------------------------------------------
International Fixed Income Funds 3.0%
- --------------------------------------------------------------------------------
TOTAL FIXED INCOME EXPOSURE 30.3%
- --------------------------------------------------------------------------------
Money Market Funds 6.0%
- --------------------------------------------------------------------------------
- ------
9
One Choice Portfolio: Moderate - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- -----------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST GAIN (LOSS) RECEIVED(1) VALUE
- -----------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.6%
- -----------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 49.6%
- ----------------------------------------
244,193 Equity Growth Fund
Investor Class $ 5,214,680 $ -- $ -- $ 11,891 $ 5,289,220
- ----------------------------------------
136,876 Growth Fund
Investor Class 2,609,751 -- -- 582 2,621,175
- ----------------------------------------
492,325 Large Company Value Fund
Investor Class 3,102,107 -- -- 13,250 3,126,264
- ----------------------------------------
27,661 Real Estate Fund
Investor Class 667,156 -- -- -- 632,054
- ----------------------------------------
67,163 Small Company Fund
Investor Class 667,306 -- -- -- 672,973
- ----------------------------------------
250,239 Value Fund
Investor Class 1,955,439 79,343 (9,064) 103,812 1,814,233
- ----------------------------------------
162,688 Vista Fund
Investor Class(3) 2,433,277 193,329 (2,587) -- 2,323,185
- -----------------------------------------------------------------------------------------------------------
16,649,716 272,672 (11,651) 129,535 16,479,104
- -----------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 27.1%
- ----------------------------------------
783,353 Diversified Bond Fund
Investor Class 8,040,002 -- -- 69,342 8,037,202
- ----------------------------------------
151,288 High-Yield Fund
Investor Class 998,937 -- -- 8,313 995,475
- -----------------------------------------------------------------------------------------------------------
9,038,939 -- -- 77,655 9,032,677
- -----------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 13.9%
- ----------------------------------------
206,496 Emerging Markets Fund
Investor Class 1,477,324 203,368 4,086 5,912 1,354,614
- ----------------------------------------
371,764 International Growth Fund
Investor Class 3,231,562 -- -- 15,880 3,286,394
- -----------------------------------------------------------------------------------------------------------
4,708,886 203,368 4,086 21,792 4,641,008
- -----------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 6.0%
- ----------------------------------------
2,002,192 Prime Money Market Fund
Investor Class 2,002,192 -- -- 4,097 2,002,192
- -----------------------------------------------------------------------------------------------------------
INTERNATIONAL FIXED INCOME FUNDS -- 3.0%
- ----------------------------------------
68,284 International Bond Fund
Investor Class 992,256 -- -- 15,088 988,069
- -----------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.6%
(Cost $32,915,949) $33,391,989 $476,040 $ (7,565) $248,167 33,143,050
- ----------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.4% 128,246
- ---------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $33,271,296
- ---------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period September 30, 2004 (fund inception) through January 31, 2005, is
shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
10
One Choice Portfolio: Aggressive - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 7.45% 9/30/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 7.22% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.59% --
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
11
One Choice Portfolio: Aggressive - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on September 30, 2004, through January 31, 2005, One Choice
Portfolio: Aggressive returned 7.45%. This return reflected the positive
performance of the portfolio's equity, fixed-income, and money market
components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the four months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 7.22%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small- and mid-cap stocks outperformed large-cap issues, while growth and value
stocks were mixed--value surpassed growth among large-cap stocks, while growth
came out ahead in the small- and mid-cap segments of the market. Foreign stocks,
led by emerging markets, outpaced domestic shares.
Bonds produced modest gains during the four-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.59%. The best
performers were corporate bonds, particularly high-yield corporate bonds, and
mortgage-backed securities.
Money market rates increased as the Federal Reserve raised short-term interest
rates twice during the period.
PORTFOLIO STRATEGY
One Choice Portfolio: Aggressive seeks the highest total return consistent with
its neutral asset mix of 78% stocks, 20% bonds, and 2% cash equivalents. The
portfolio is a "fund of funds," which means it invests in other American Century
mutual funds to achieve its investment objective and neutral asset mix. (See the
following page for a list of the underlying funds in the portfolio.)
The portfolio's neutral asset mix, which features a diversified blend of asset
classes and investment styles, generally represents its long-term asset
allocation strategy. However, we may make adjustments to the neutral asset mix
to take advantage of opportunities that we believe will help the portfolio
better meet its investment objective.
An investment in One Choice Portfolio: Aggressive entails some risks, including
those associated with investing in stocks, bonds, and foreign equities. The
value of the portfolio's shares will fluctuate over time.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Equity Funds 59.7%
- --------------------------------------------------------------------------------
International Equity Funds 19.1%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 78.8%
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 19.2%
- --------------------------------------------------------------------------------
Money Market Funds 2.0%
- --------------------------------------------------------------------------------
- ------
12
One Choice Portfolio: Aggressive - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- -----------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST GAIN (LOSS) RECEIVED(1) VALUE
- -----------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 99.9%
- -----------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 59.7%
- ----------------------------------------
147,995 Equity Growth Fund
Investor Class $ 3,164,016 $ 2,046 $ (36) $ 7,014 $ 3,205,571
- ----------------------------------------
165,851 Growth Fund
Investor Class 3,168,723 2,015 (1) 686 3,176,047
- ----------------------------------------
294,733 Large Company Value Fund
Investor Class 1,858,732 1,184 (8) 8,000 1,871,555
- ----------------------------------------
18,460 Real Estate Fund
Investor Class 447,133 -- -- -- 421,811
- ----------------------------------------
50,572 Small Company Fund
Investor Class 503,190 -- -- -- 506,731
- ----------------------------------------
144,507 Value Fund
Investor Class 1,209,134 125,657 (13,873) 70,537 1,047,676
- ----------------------------------------
209,847 Vista Fund
Investor Class(3) 3,044,417 144,566 (2,657) -- 2,996,615
- -----------------------------------------------------------------------------------------------------------
13,395,345 275,468 (16,575) 86,237 13,226,006
- -----------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 19.2%
- ----------------------------------------
306,331 Diversified Bond Fund
Investor Class 3,151,650 6,882 (80) 29,701 3,142,956
- ----------------------------------------
168,919 High-Yield Fund
Investor Class 1,116,643 693 2 9,748 1,111,487
- -----------------------------------------------------------------------------------------------------------
4,268,293 7,575 (78) 39,449 4,254,443
- -----------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 19.0%
- ----------------------------------------
224,676 Emerging Markets Fund
Investor Class 1,468,701 78,746 282 5,872 1,473,875
- ----------------------------------------
310,800 International Growth Fund
Investor Class 2,753,618 51,349 (155) 14,629 2,747,472
- -----------------------------------------------------------------------------------------------------------
4,222,319 130,095 127 20,501 4,221,347
- -----------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 2.0%
- ----------------------------------------
447,346 Prime Money Market Fund
Investor Class 447,623 276 -- 963 447,346
- -----------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 99.9%
(Cost $21,920,166) $22,333,580 $413,414 $(16,526) $147,150 22,149,142
- ----------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES -- 0.1% 16,133
- ---------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $22,165,275
- ---------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period September 30, 2004 (fund inception) through January 31, 2005, is
shown.
(3) Non-income producing.
See Notes to Financial Statements.
- ------
13
One Choice Portfolio: Very Aggressive - Performance
TOTAL RETURNS AS OF JANUARY 31, 2005
- --------------------------------------------------------------------------------
SINCE INCEPTION
INCEPTION(1) DATE
- --------------------------------------------------------------------------------
INVESTOR CLASS 8.65% 9/30/04
- --------------------------------------------------------------------------------
RUSSELL 3000 INDEX 7.22% --
- --------------------------------------------------------------------------------
LEHMAN BROTHERS U.S. AGGREGATE INDEX 1.59% --
- --------------------------------------------------------------------------------
(1) Returns for periods less than one year are not annualized.
Data presented reflect past performance. Past performance is no guarantee of
future results. Current performance may be higher or lower than the performance
shown. Investment return and principal value will fluctuate, and redemption
value may be more or less than original cost. To obtain performance data current
to the most recent month end, please call 1-800-345-2021 or visit
americancentury.com. As interest rates rise, bond values will decline.
Data assumes reinvestment of dividends and capital gains, and none of the charts
reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. Returns for the indices are
provided for comparison. The fund's total returns include operating expenses
such as administrative fees that reduce returns, while the total returns of the
indices do not.
An investment in a money market fund is neither insured nor guaranteed by the
FDIC or any other government agency. Yields will fluctuate, and although the
underlying money market fund seeks to preserve the value of an investment at $1
per share, it is possible to lose money by investing in the underlying fund.
- ------
14
One Choice Portfolio: Very Aggressive - Portfolio Commentary
PORTFOLIO MANAGERS: JEFF TYLER AND GINA SANCHEZ
PERFORMANCE SUMMARY
From its inception on September 30, 2004, through January 31, 2005, One Choice
Portfolio: Very Aggressive returned 8.65%. This return primarily reflected the
positive performance of the portfolio's equity holdings, as well as its modest
fixed-income and money market components.
MARKET ENVIRONMENT
The financial markets posted generally positive results during the four months
covered by this report. The stock market registered solid gains, with the broad
Russell 3000 Index returning 7.22%. Falling oil prices and a decisive
presidential election helped produce a sharp stock market rally in late 2004,
though the market gave back some of those gains in early 2005.
Small- and mid-cap stocks outperformed large-cap issues, while growth and value
stocks were mixed--value surpassed growth among large-cap stocks, while growth
came out ahead in the small- and mid-cap segments of the market. Foreign stocks,
led by emerging markets, outpaced domestic shares.
Bonds produced modest gains during the four-month period; the Lehman Brothers
U.S. Aggregate Index, a broad bond market measure, returned 1.59%. The best
performers were corporate bonds and mortgage-backed securities.
Money market rates increased as the Federal Reserve raised short-term interest
rates twice during the period.
PORTFOLIO STRATEGY
One Choice Portfolio: Very Aggressive seeks the highest total return consistent
with its neutral asset mix of 95% stocks, 3% bonds, and 2% cash equivalents. The
portfolio is a "fund of funds," which means it invests in other American Century
mutual funds to achieve its investment objective and neutral asset mix. (See the
following page for a list of the underlying funds in the portfolio.)
The portfolio's neutral asset mix, which features a diversified blend of asset
classes and investment styles, generally represents its long-term asset
allocation strategy. However, we may make adjustments to the neutral asset mix
to take advantage of opportunities that we believe will help the portfolio
better meet its investment objective.
An investment in One Choice Portfolio: Very Aggressive entails some risks,
including those associated with investing in domestic and foreign stocks. The
portfolio is expected to have the greatest short-term price volatility of the
One Choice Portfolios.
We appreciate your investment in this new fund and hope it will be an important
part of your portfolio.
TYPES OF INVESTMENTS IN PORTFOLIO
- --------------------------------------------------------------------------------
% OF FUND
INVESTMENTS
AS OF
1/31/05
- --------------------------------------------------------------------------------
Domestic Equity Funds 72.9%
- --------------------------------------------------------------------------------
International Equity Funds 23.1%
- --------------------------------------------------------------------------------
TOTAL EQUITY EXPOSURE 96.0%
- --------------------------------------------------------------------------------
Domestic Fixed Income Funds 2.0%
- --------------------------------------------------------------------------------
Money Market Funds 2.0%
- --------------------------------------------------------------------------------
- ------
15
One Choice Portfolio: Very Aggressive - Schedule of Investments
JANUARY 31, 2005 (UNAUDITED)
- -----------------------------------------------------------------------------------------------------------
PURCHASE SALES REALIZED DISTRIBUTIONS
SHARES COST COST LOSS RECEIVED(1) VALUE
- -----------------------------------------------------------------------------------------------------------
MUTUAL FUNDS(2) -- 100.0%
- -----------------------------------------------------------------------------------------------------------
DOMESTIC EQUITY FUNDS -- 72.9%
- ----------------------------------------
67,702 Equity Growth Fund
Investor Class $1,477,902 $ 31,063 $ (680) $ 3,601 $ 1,466,424
- ----------------------------------------
75,899 Growth Fund
Investor Class 1,478,167 30,918 (554) 353 1,453,466
- ----------------------------------------
136,130 Large Company Value Fund
Investor Class 876,005 18,276 (321) 4,044 864,426
- ----------------------------------------
6,901 Real Estate Fund
Investor Class 169,822 2,868 (116) -- 157,688
- ----------------------------------------
20,968 Small Company Fund
Investor Class 212,436 3,524 (92) -- 210,099
- ----------------------------------------
68,267 Value Fund
Investor Class 553,659 39,344 (4,518) 32,818 494,936
- ----------------------------------------
95,788 Vista Fund
Investor Class(3) 1,398,938 76,682 (1,747) -- 1,367,853
- -----------------------------------------------------------------------------------------------------------
6,166,929 202,675 (8,028) 40,816 6,014,892
- -----------------------------------------------------------------------------------------------------------
INTERNATIONAL EQUITY FUNDS -- 23.1%
- ----------------------------------------
96,712 Emerging Markets Fund
Investor Class 632,000 32,824 (65) 2,376 634,431
- ----------------------------------------
144,049 International Growth Fund
Investor Class 1,276,090 28,079 (521) 6,406 1,273,393
- -----------------------------------------------------------------------------------------------------------
1,908,090 60,903 (586) 8,782 1,907,824
- -----------------------------------------------------------------------------------------------------------
DOMESTIC FIXED INCOME FUNDS -- 2.0%
- ----------------------------------------
16,350 Diversified Bond Fund
Investor Class 217,333 49,807 (580) 2,148 167,751
- -----------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS -- 2.0%
- ----------------------------------------
167,269 Prime Money Market Fund
Investor Class 170,690 3,421 -- 368 167,269
- -----------------------------------------------------------------------------------------------------------
TOTAL INVESTMENT SECURITIES -- 100.0%
(Cost $8,146,236) $8,463,042 $316,806 $(9,194) $52,114 8,257,736
- ----------------------------------------======================================================-------------
OTHER ASSETS AND LIABILITIES(4) 3,731
- ---------------------------------------- -------------
TOTAL NET ASSETS -- 100.0% $8,261,467
- ---------------------------------------- =============
NOTES TO SCHEDULE OF INVESTMENTS
(1) Distributions received includes distributions from net investment income
and capital gains from underlying funds.
(2) Investments are funds within the American Century family of funds, of which
certain funds may be deemed to be under common control because of the same
board of directors. A summary of transactions for each security during the
period September 30, 2004 (fund inception) through January 31, 2005, is
shown.
(3) Non-income producing.
(4) Category is less than 0.05% of total net assets.
See Notes to Financial Statements.
- ------
16
Shareholder Fee Examples (Unaudited)
Fund shareholders may incur two types of costs: (1) transaction costs, including
sales charges (loads) on purchase payments and redemption/exchange fees; and (2)
ongoing costs, including management fees; distribution and service (12b-1) fees;
and other fund expenses. This example is intended to help you understand your
ongoing costs (in dollars) of investing in your fund and to compare these costs
with the ongoing cost of investing in other mutual funds. As a shareholder in
the underlying American Century funds, your fund will indirectly bear its pro
rata share of the expenses incurred by the underlying funds. These expenses are
not included in the fund's annualized expense ratio used to calculate the
expense estimate in this example. If they were, the estimate of expenses you
paid during the period would be higher.
The example is based on an investment of $1,000 made at the beginning of the
period and held for the entire period from August 1, 2004 to January 31, 2005
(except as noted).
ACTUAL EXPENSES
The table provides information about actual account values and actual expenses
for each class. You may use the information, together with the amount you
invested, to estimate the expenses that you paid over the period. First,
identify the share class you own. Then simply divide your account value by
$1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then
multiply the result by the number under the heading "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century fund, or Institutional
Class shares of the American Century Diversified Bond Fund, in an American
Century account (i.e., not a financial intermediary or retirement plan account),
American Century may charge you a $12.50 semiannual account maintenance fee if
the value of those shares is less than $10,000. We will redeem shares
automatically in one of your accounts to pay the $12.50 fee. In determining your
total eligible investment amount, we will include your investments in all
PERSONAL ACCOUNTS (including American Century Brokerage accounts) registered
under your Social Security number. PERSONAL ACCOUNTS include individual
accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell
Education Savings Accounts and IRAs (including traditional, Roth, Rollover,
SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you
have only business, business retirement, employer-sponsored or American Century
Brokerage accounts, you are currently not subject to this fee. We will not
charge the fee as long as you choose to manage your accounts exclusively online.
If you are subject to the Account Maintenance Fee, your account value could be
reduced by the fee amount.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The table also provides information about hypothetical account values and
hypothetical expenses based on the actual expense ratio of each class of your
fund and an assumed rate of return of 5% per year before expenses, which is not
the actual return of a
(continued)
- ------
17
Shareholder Fee Examples (Unaudited)
fund's share class. The hypothetical account values and expenses may not be used
to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in your fund and other funds. To do so, compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of the
other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads) or redemption/exchange fees. Therefore, the table is useful in
comparing ongoing costs only, and will not help you determine the relative total
costs of owning different funds. In addition, if these transactional costs were
included, your costs would have been higher.
- --------------------------------------------------------------------------------
EXPENSES PAID
BEGINNING ENDING DURING PERIOD(1) ANNUALIZED
ACCOUNT VALUE ACCOUNT VALUE 8/1/04 - EXPENSE
8/1/04 1/31/05 1/31/05 RATIO(1)
- --------------------------------------------------------------------------------
ONE CHOICE PORTFOLIO: VERY CONSERVATIVE INVESTOR CLASS SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
Actual $1,000 $1,033.50(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Hypothetical $1,000 $1,025.21(4) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
ONE CHOICE PORTFOLIO: CONSERVATIVE INVESTOR CLASS SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
Actual $1,000 $1,047.80(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Hypothetical $1,000 $1,025.21(4) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
ONE CHOICE PORTFOLIO: MODERATE INVESTOR CLASS SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
Actual $1,000 $1,066.50(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Hypothetical $1,000 $1,025.21(4) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
ONE CHOICE PORTFOLIO: AGGRESSIVE INVESTOR CLASS SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
Actual $1,000 $1,074.50(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Hypothetical $1,000 $1,025.21(4) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
ONE CHOICE PORTFOLIO: VERY AGGRESSIVE INVESTOR CLASS SHAREHOLDER FEE EXAMPLE
- --------------------------------------------------------------------------------
Actual $1,000 $1,086.50(2) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
Hypothetical $1,000 $1,025.21(4) $0.00(3) 0.00%
- --------------------------------------------------------------------------------
(1) Expenses are equal to the class's annualized expense ratio listed in the
table above, multiplied by the average account value over the period,
multiplied by 184, the number of days in the most recent fiscal half-year,
divided by 365, to reflect the one-half year period. The fees and expenses
of the underlying American Century funds in which the fund invests are not
included in the class's annualized expense ratio.
(2) Ending account values based on actual returns from September 30, 2004 (fund
inception) through January 31, 2005.
(3) The fund did not have any annual operating expenses during the period and
is not expected to have any other than the expenses of the underlying funds.
(4) Ending account values assume the classes had been available throughout the
entire period.
- ------
18
Statement of Assets and Liabilities
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------
VERY
CONSERVATIVE CONSERVATIVE MODERATE
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investment securities in
affiliates, at value (cost of
$4,023,738, $14,795,430 and
$32,915,949, respectively) $4,032,639 $14,849,270 $33,143,050
- -----------------------------------
Cash 54 68 --
- -----------------------------------
Receivable for capital
shares sold 3,094 7,267 106,731
- -----------------------------------
Distributions receivable
from affiliates 4,812 14,062 23,678
- --------------------------------------------------------------------------------
4,040,599 14,870,667 33,273,459
- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Disbursements in excess of
demand deposit cash -- -- 2,163
- --------------------------------------------------------------------------------
NET ASSETS $4,040,599 $14,870,667 $33,271,296
================================================================================
CAPITAL SHARES, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Outstanding 399,330 1,446,457 3,160,563
================================================================================
NET ASSET VALUE PER SHARE $10.12 $10.28 $10.53
================================================================================
NET ASSETS CONSIST OF:
- --------------------------------------------------------------------------------
Capital (par value and
paid-in surplus) $4,049,587 $14,802,779 $33,011,814
- -----------------------------------
Accumulated net investment loss (25,307) (37,570) (32,262)
- -----------------------------------
Undistributed net realized gain
on investment transactions 7,418 51,618 64,643
- -----------------------------------
Net unrealized appreciation
on investments 8,901 53,840 227,101
- --------------------------------------------------------------------------------
$4,040,599 $14,870,667 $33,271,296
================================================================================
See Notes to Financial Statements. (continued)
- ------
19
Statement of Assets and Liabilities
JANUARY 31, 2005 (UNAUDITED)
- --------------------------------------------------------------------------------
VERY
AGGRESSIVE AGGRESSIVE
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investment securities in affiliates,
at value (cost of $21,920,166 and
$8,146,236, respectively) $22,149,142 $8,257,736
- ---------------------------------------------
Cash 57 73
- ---------------------------------------------
Receivable for capital shares sold 3,533 3,095
- ---------------------------------------------
Distributions receivable from affiliates 12,543 563
- --------------------------------------------------------------------------------
NET ASSETS $22,165,275 $8,261,467
================================================================================
CAPITAL SHARES, $0.01 PAR VALUE
- --------------------------------------------------------------------------------
Outstanding 2,084,008 767,178
================================================================================
NET ASSET VALUE PER SHARE $10.64 $10.77
================================================================================
NET ASSETS CONSIST OF:
- --------------------------------------------------------------------------------
Capital (par value and paid-in surplus) $21,915,881 $8,141,805
- ---------------------------------------------
Accumulated net investment loss (10,730) (2,486)
- ---------------------------------------------
Undistributed net realized gain on
investment transactions 31,148 10,648
- ---------------------------------------------
Net unrealized appreciation on investments 228,976 111,500
- --------------------------------------------------------------------------------
$22,165,275 $8,261,467
================================================================================
See Notes to Financial Statements.
- ------
20
Statement of Operations
FOR THE PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
VERY
CONSERVATIVE CONSERVATIVE MODERATE
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
INCOME:
- -----------------------------------
Income distributions from
underlying funds -- affiliates $36,321 $128,145 $175,959
- --------------------------------------------------------------------------------
EXPENSES:
- -----------------------------------
Directors' fees and expenses 6 17 28
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME 36,315 128,128 175,931
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON AFFILIATES
- --------------------------------------------------------------------------------
NET REALIZED GAIN (LOSS) ON:
- -----------------------------------
Sale of investments in
underlying funds (4,580) (694) (7,565)
- -----------------------------------
Capital gain distributions received
from underlying funds 11,998 52,312 72,208
- --------------------------------------------------------------------------------
7,418 51,618 64,643
- --------------------------------------------------------------------------------
CHANGE IN NET UNREALIZED
APPRECIATION ON INVESTMENTS 8,901 53,840 227,101
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN 16,319 105,458 291,744
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $52,634 $233,586 $467,675
================================================================================
*September 30, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements. (continued)
- ------
21
Statement of Operations
FOR THE PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
VERY
AGGRESSIVE AGGRESSIVE
- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
INCOME:
- ---------------------------------------------
Income distributions from
underlying funds -- affiliates $ 99,476 $ 32,272
- --------------------------------------------------------------------------------
EXPENSES:
- ---------------------------------------------
Directors' fees and expenses 20 8
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME 99,456 32,264
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON AFFILIATES
- --------------------------------------------------------------------------------
NET REALIZED GAIN (LOSS) ON:
- ---------------------------------------------
Sale of investments in underlying funds (16,526) (9,194)
- ---------------------------------------------
Capital gain distributions received
from underlying funds 47,674 19,842
- --------------------------------------------------------------------------------
31,148 10,648
- --------------------------------------------------------------------------------
CHANGE IN NET UNREALIZED
APPRECIATION ON INVESTMENTS 228,976 111,500
- --------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN 260,124 122,148
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $359,580 $154,412
================================================================================
*September 30, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements.
- ------
22
Statement of Changes in Net Assets
PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
VERY
INCREASE IN NET ASSETS CONSERVATIVE CONSERVATIVE MODERATE
- --------------------------------------------------------------------------------
OPERATIONS
- --------------------------------------------------------------------------------
Net investment income $ 36,315 $ 128,128 $ 175,931
- ------------------------------------
Net realized gain 7,418 51,618 64,643
- ------------------------------------
Change in net
unrealized appreciation 8,901 53,840 227,101
- --------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 52,634 233,586 467,675
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
- --------------------------------------------------------------------------------
From net investment income (61,622) (165,698) (208,193)
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
- --------------------------------------------------------------------------------
Proceeds from shares sold 4,293,233 15,480,497 34,215,001
- ------------------------------------
Proceeds in reinvestment
of distributions 61,113 163,770 197,770
- ------------------------------------
Payments for shares redeemed (304,759) (841,488) (1,400,957)
- --------------------------------------------------------------------------------
Net increase in net assets from
capital share transactions 4,049,587 14,802,779 33,011,814
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS 4,040,599 14,870,667 33,271,296
NET ASSETS
- --------------------------------------------------------------------------------
Beginning of period -- -- --
- --------------------------------------------------------------------------------
End of period $4,040,599 $14,870,667 $33,271,296
================================================================================
Accumulated net investment loss $(25,307) $(37,570) $(32,262)
================================================================================
TRANSACTIONS IN SHARES OF THE FUND
- --------------------------------------------------------------------------------
Sold 423,449 1,512,148 3,275,575
- ------------------------------------
Issued in reinvestment
of distributions 6,045 15,946 18,835
- ------------------------------------
Redeemed (30,164) (81,637) (133,847)
- --------------------------------------------------------------------------------
Net increase in shares of the fund 399,330 1,446,457 3,160,563
================================================================================
*September 30, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements. (continued)
- ------
23
Statement of Changes in Net Assets
PERIOD ENDED JANUARY 31, 2005* (UNAUDITED)
- --------------------------------------------------------------------------------
VERY
INCREASE IN NET ASSETS AGGRESSIVE AGGRESSIVE
- --------------------------------------------------------------------------------
OPERATIONS
- --------------------------------------------------------------------------------
Net investment income $ 99,456 $ 32,264
- ---------------------------------------------
Net realized gain 31,148 10,648
- ---------------------------------------------
Change in net unrealized appreciation 228,976 111,500
- --------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 359,580 154,412
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
- --------------------------------------------------------------------------------
From net investment income (110,186) (34,750)
- --------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
- --------------------------------------------------------------------------------
Proceeds from shares sold 22,334,758 8,852,457
- ---------------------------------------------
Proceeds in reinvestment of distributions 109,534 34,434
- ---------------------------------------------
Payments for shares redeemed (528,411) (745,086)
- --------------------------------------------------------------------------------
Net increase in net assets from
capital share transactions 21,915,881 8,141,805
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS 22,165,275 8,261,467
NET ASSETS
- --------------------------------------------------------------------------------
Beginning of period -- --
- --------------------------------------------------------------------------------
End of period $22,165,275 $8,261,467
================================================================================
Accumulated net investment loss $(10,730) $(2,486)
================================================================================
TRANSACTIONS IN SHARES OF THE FUND
- --------------------------------------------------------------------------------
Sold 2,123,929 833,966
- ---------------------------------------------
Issued in reinvestment of distributions 10,324 3,203
- ---------------------------------------------
Redeemed (50,245) (69,991)
- --------------------------------------------------------------------------------
Net increase in shares of the fund 2,084,008 767,178
================================================================================
*September 30, 2004 (fund inception) through January 31, 2005.
See Notes to Financial Statements.
- ------
24
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION -- American Century Asset Allocation Portfolios, Inc. (the
corporation) is registered under the Investment Company Act of 1940 (the 1940
Act), as amended, as an open-end management investment company. One Choice
Portfolio: Very Conservative (Very Conservative), One Choice Portfolio:
Conservative (Conservative), One Choice Portfolio: Moderate (Moderate), One
Choice Portfolio: Aggressive (Aggressive), One Choice Portfolio: Very Aggressive
(Very Aggressive) (collectively, the funds) are five funds in a series issued by
the corporation. The funds operate as "fund of funds," meaning that
substantially all of the funds' assets will be invested in other funds in the
American Century family of funds (the underlying funds). Because the funds
directly invest in a relatively small number of underlying funds, they are not
diversified as defined in the 1940 Act. However, the underlying funds are
generally diversified and so indirectly provide broad exposure to a large number
of securities. The funds' investment objectives are to seek the highest total
return consistent with their respective asset mix. The funds pursue their
objectives by investing in underlying funds that represent a variety of asset
classes and investment styles. Generally, more conservative funds emphasize
investments in bonds and cash equivalents while more aggressive funds emphasize
investments in stocks. The funds incepted on September 30, 2004. The corporation
is authorized to issue 3,000,000,000 shares. The following is a summary of the
funds' significant accounting policies.
UNDERLYING FUNDS -- Each fund's assets are allocated among underlying funds that
represent major asset classes, including equity securities (stocks),
fixed-income securities (bonds) and cash-equivalent instruments (money markets).
A brief description of each of the underlying funds follows.
DOMESTIC EQUITY FUNDS
GROWTH seeks long-term capital growth. It uses a growth investment strategy and
generally invests in larger U.S. companies.
VISTA seeks long-term capital growth. It uses a growth investment strategy and
generally invests in medium-sized and smaller U.S. companies.
EQUITY GROWTH seeks long-term capital growth. It uses a quantitative investment
strategy to construct an optimized portfolio drawn primarily from the 1,500
largest publicly traded U.S. companies without regard to dividend yield.
SMALL COMPANY seeks long-term capital growth. It uses a quantitative investment
strategy and invests primarily in smaller U.S. companies.
REAL ESTATE seeks long-term capital appreciation with income as a secondary
objective. It invests primarily in equity securities issued by real estate
investment trusts and companies engaged in the real estate industry.
LARGE COMPANY VALUE seeks long-term capital growth with income as a secondary
objective. It uses a value investment strategy and invests primarily in larger
U.S. companies.
VALUE seeks long-term capital growth with income as a secondary objective. It
uses a value investment strategy and invests primarily in U.S. companies of all
sizes.
INTERNATIONAL EQUITY FUNDS
INTERNATIONAL GROWTH seeks capital growth. It uses a growth investment strategy
and invests primarily in securities of companies located in developed countries
other than the United States.
EMERGING MARKETS seeks capital growth. It uses a growth investment strategy and
invests primarily in securities of companies located in emerging market
countries and companies that derive a significant portion of their business from
emerging market countries.
DOMESTIC FIXED INCOME FUNDS
DIVERSIFIED BOND seeks a high level of income by investing primarily in high-
and medium-grade non-money market debt securities. These securities, which may
be payable in U.S. or foreign currencies, may include corporate bonds and notes,
government securities and securities backed by mortgages or other assets.
HIGH-YIELD seeks high current income by investing in a diversified portfolio of
high-yield corporate bonds and other debt securities.
INTERNATIONAL FIXED INCOME FUNDS
INTERNATIONAL BOND seeks high total return by investing in high-quality,
non-dollar-denominated government and corporate debt securities outside the
United States.
MONEY MARKET FUNDS
PRIME MONEY MARKET seeks to earn the highest level of current income while
preserving the value of shareholder investments by investing in high-quality,
cash-equivalent securities.
(continued)
- ------
25
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
SECURITY VALUATIONS -- Investments in the underlying funds are valued at their
reported net asset value. The underlying funds have specific valuation policies.
If the underlying funds determine that the market price of a security is not
readily available, or that the specific valuation methods do not reflect the
security's fair value, such security is valued at its fair value as determined
by, or in accordance with procedures adopted by, the Board of Directors or its
designee if such fair value determination would materially impact an underlying
fund's net asset value.
SECURITY TRANSACTIONS -- Security transactions are accounted for as of trade
date. Net realized gains and losses are determined on the identified cost basis,
which is also used for federal income tax purposes.
INVESTMENT INCOME -- Income and capital gains distributions, if any, from the
underlying funds are recorded as of ex-dividend date. Long-term capital gain
distributions, if any, from the underlying funds are a component of realized
gain (loss).
INCOME TAX STATUS -- It is each fund's policy to distribute substantially all
net investment income and net realized gains to shareholders and otherwise
qualify as a regulated investment company under provisions of the Internal
Revenue Code. Accordingly, no provision has been made for federal or state
income taxes.
DISTRIBUTIONS TO SHAREHOLDERS -- Distributions to shareholders are recorded on
the ex-dividend date. Distributions from net investment income, if any, are
generally declared and paid quarterly for Very Conservative, Conservative, and
Moderate. Distributions from net investment income, if any, are generally
declared and paid annually for Aggressive and Very Aggressive. Distributions
from net realized gains, if any, are generally declared and paid annually for
all funds.
USE OF ESTIMATES -- The financial statements are prepared in conformity with
accounting principles generally accepted in the United States of America, which
may require management to make certain estimates and assumptions at the date of
the financial statements. Actual results could differ from these estimates.
2. FEES AND TRANSACTIONS WITH RELATED PARTIES
MANAGEMENT FEES -- Each fund will indirectly realize its pro rata share of the
fees and expenses of the underlying funds in which it invests. These fees and
expenses are already reflected in the valuation of the underlying funds.
RELATED PARTIES -- Certain officers and directors of the corporation are also
officers and/or directors, and, as a group, controlling stockholders of American
Century Companies, Inc. (ACC), the parent of the corporation's investment
advisor, American Century Investment Management, Inc. (ACIM), the distributor of
the corporation, American Century Investment Services, Inc. (ACIS), and the
corporation's transfer agent, American Century Services, LLC (ACS). The
directors of the corporation are also directors of some underlying funds and
therefore those underlying funds may be deemed to be under common control with
the corporation. The officers of the corporation are also officers of all the
underlying funds. ACIM or American Century Global Investment Management, Inc., a
wholly-owned subsidiary of ACIM, serves as the investment advisor for the
underlying funds.
3. INVESTMENT TRANSACTIONS
Investment transactions, excluding short-term investments, for the period ended
January 31, 2005, were as follows:
- --------------------------------------------------------------------------------
VERY VERY
CONSERVATIVE CONSERVATIVE MODERATE AGGRESSIVE AGGRESSIVE
- --------------------------------------------------------------------------------
Purchases $4,331,547 $15,318,589 $33,391,989 $22,333,580 $8,463,042
- --------------------------------------------------------------------------------
Proceeds
from sales $303,229 $522,465 $468,475 $396,888 $307,612
- --------------------------------------------------------------------------------
(continued)
- ------
26
Notes to Financial Statements
JANUARY 31, 2005 (UNAUDITED)
4. FEDERAL TAX INFORMATION
The character of distributions made during the period from net investment income
or net realized gains may differ from their ultimate characterization for
federal income tax purposes. These differences reflect the differing character
of certain income items and net realized gains and losses for financial
statement and tax purposes, and may result in reclassification among certain
capital accounts on the financial statements.
As of January 31, 2005, the federal tax cost of investments was as follows:
VERY VERY
CONSERVATIVE CONSERVATIVE MODERATE AGGRESSIVE AGGRESSIVE
- --------------------------------------------------------------------------------------------
Federal tax cost
of investments $4,028,784 $14,800,214 $32,927,600 $21,937,033 $8,155,576
============================================================================================
Gross tax appreciation
of investments $ 21,180 $129,401 $ 331,927 $293,460 $135,795
- -----------------------
Gross tax depreciation
of investments (17,325) (80,345) (116,477) (81,351) (33,635)
- --------------------------------------------------------------------------------------------
Net tax appreciation
of investments $ 3,855 $ 49,056 $ 215,450 $212,109 $102,160
============================================================================================
The difference between book-basis and tax-basis cost and unrealized appreciation
(depreciation) is attributable primarily to the tax deferral of losses on wash
sales.
5. OTHER INFORMATION
The funds do not invest in the underlying funds for the purpose of exercising
management or control; however, investments by the funds within their investment
strategies may represent a significant portion of the underlying funds' net
assets.
As of January 31, 2005, the funds did not own a significant percentage of the
total outstanding shares of the underlying funds.
- ------
27
One Choice Portfolio: Very Conservative - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- ---------------------------------------------------------------
Net Investment Income(2) 0.17
- ---------------------------------------------------------------
Net Realized and Unrealized Gain 0.16
- --------------------------------------------------------------------------------
Total From Investment Operations 0.33
- --------------------------------------------------------------------------------
Distributions
- ---------------------------------------------------------------
From Net Investment Income (0.21)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.12
================================================================================
TOTAL RETURN(3) 3.35%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- ---------------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 5.10%(4)
- ---------------------------------------------------------------
Portfolio Turnover Rate 15%
- ---------------------------------------------------------------
Net Assets, End of Period (in thousands) $4,041
- --------------------------------------------------------------------------------
(1) September 30, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(4) Annualized.
See Notes to Financial Statements.
- ------
28
One Choice Portfolio: Conservative - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- ---------------------------------------------------------------
Net Investment Income(2) 0.19
- ---------------------------------------------------------------
Net Realized and Unrealized Gain 0.29
- --------------------------------------------------------------------------------
Total From Investment Operations 0.48
- --------------------------------------------------------------------------------
Distributions
- ---------------------------------------------------------------
From Net Investment Income (0.20)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.28
================================================================================
TOTAL RETURN(3) 4.78%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- ---------------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 5.52%(4)
- ---------------------------------------------------------------
Portfolio Turnover Rate 8%
- ---------------------------------------------------------------
Net Assets, End of Period (in thousands) $14,871
- --------------------------------------------------------------------------------
(1) September 30, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(4) Annualized.
See Notes to Financial Statements.
- ------
29
One Choice Portfolio: Moderate - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- ---------------------------------------------------------------
Net Investment Income(2) 0.14
- ---------------------------------------------------------------
Net Realized and Unrealized Gain 0.52
- --------------------------------------------------------------------------------
Total From Investment Operations 0.66
- --------------------------------------------------------------------------------
Distributions
- ---------------------------------------------------------------
From Net Investment Income (0.13)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.53
================================================================================
TOTAL RETURN(3) 6.65%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- ---------------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 4.07%(4)
- ---------------------------------------------------------------
Portfolio Turnover Rate 4%
- ---------------------------------------------------------------
Net Assets, End of Period (in thousands) $33,271
- --------------------------------------------------------------------------------
(1) September 30, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(4) Annualized.
See Notes to Financial Statements.
- ------
30
One Choice Portfolio: Aggressive - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- ---------------------------------------------------------------
Net Investment Income(2) 0.12
- ---------------------------------------------------------------
Net Realized and Unrealized Gain 0.62
- --------------------------------------------------------------------------------
Total From Investment Operations 0.74
- --------------------------------------------------------------------------------
Distributions
- ---------------------------------------------------------------
From Net Investment Income (0.10)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.64
================================================================================
TOTAL RETURN(3) 7.45%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- ---------------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 3.26%(4)
- ---------------------------------------------------------------
Portfolio Turnover Rate 4%
- ---------------------------------------------------------------
Net Assets, End of Period (in thousands) $22,165
- --------------------------------------------------------------------------------
(1) September 30, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(4) Annualized.
See Notes to Financial Statements.
- ------
31
One Choice Portfolio: Very Aggressive - Financial Highlights
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD INDICATED
- --------------------------------------------------------------------------------
2005(1)
- --------------------------------------------------------------------------------
PER-SHARE DATA
- --------------------------------------------------------------------------------
Net Asset Value, Beginning of Period $10.00
- --------------------------------------------------------------------------------
Income From Investment Operations
- ---------------------------------------------------------------
Net Investment Income(2) 0.10
- ---------------------------------------------------------------
Net Realized and Unrealized Gain 0.76
- --------------------------------------------------------------------------------
Total From Investment Operations 0.86
- --------------------------------------------------------------------------------
Distributions
- ---------------------------------------------------------------
From Net Investment Income (0.09)
- --------------------------------------------------------------------------------
Net Asset Value, End of Period $10.77
================================================================================
TOTAL RETURN(3) 8.65%
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------
Ratio of Operating Expenses to Average Net Assets 0.00%(4)
- ---------------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets 2.74%(4)
- ---------------------------------------------------------------
Portfolio Turnover Rate 9%
- ---------------------------------------------------------------
Net Assets, End of Period (in thousands) $8,261
- --------------------------------------------------------------------------------
(1) September 30, 2004 (fund inception) through January 31, 2005 (unaudited).
(2) Computed using average shares outstanding throughout the period.
(3) Total return assumes reinvestment of net investment income and capital gains
distributions, if any. Total returns for periods less than one year are not
annualized.
(4) Annualized.
See Notes to Financial Statements.
- ------
32
Additional Information
RETIREMENT ACCOUNT INFORMATION
As required by law, any distributions you receive from an IRA or certain 403(b),
457 and qualified plans [those not eligible for rollover to an IRA or to another
qualified plan] are subject to federal income tax withholding, unless you elect
not to have withholding apply. Tax will be withheld on the total amount
withdrawn even though you may be receiving amounts that are not subject to
withholding, such as nondeductible contributions. In such case, excess amounts
of withholding could occur. You may adjust your withholding election so that a
greater or lesser amount will be withheld.
If you don't want us to withhold on this amount, you must notify us to not
withhold the federal income tax. Even if you plan to roll over the amount you
withdraw to another tax-deferred account, the withholding rate still applies to
the withdrawn amount unless we have received notice not to withhold federal
income tax prior to the withdrawal. You may notify us in writing or in certain
situations by telephone or through other electronic means. You have the right to
revoke your withholding election at any time and any election you make may
remain in effect until revoked by filing a new election.
Remember, even if you elect not to have income tax withheld, you are liable for
paying income tax on the taxable portion of your withdrawal. If you elect not to
have income tax withheld or you don't have enough income tax withheld, you may
be responsible for payment of estimated tax. You may incur penalties under the
estimated tax rules if your withholding and estimated tax payments are not
sufficient.
State tax will be withheld if, at the time of your distribution, your address is
within one of the mandatory withholding states and you have federal income tax
withheld. State taxes will be withheld from your distribution in accordance with
the respective state rules.
PROXY VOTING GUIDELINES
American Century Investment Management, Inc., the funds' investment advisor, is
responsible for exercising the voting rights associated with the securities
purchased and/or held by the funds. A description of the policies and procedures
the advisor uses in fulfilling this responsibility is available without charge,
upon request, by calling 1-800-345-2021. It is also available on American
Century's Web site at americancentury.com and on the Securities and Exchange
Commission's Web site at sec.gov. Because the funds had not commenced operations
as of the most recent 12-month period ended June 30, information regarding how
the investment advisor voted proxies is not available.
(continued)
- ------
33
Additional Information
QUARTERLY PORTFOLIO DISCLOSURE
The funds file their complete schedule of portfolio holdings with the Securities
and Exchange Commission (SEC) for the first and third quarters of each fiscal
year on Form N-Q. The funds' Forms N-Q are available on the SEC's Web site at
sec.gov, and may be reviewed and copied at the SEC's Public Reference Room in
Washington, DC. Information on the operation of the Public Reference Room may be
obtained by calling 1-800-SEC-0330. The funds also make their complete schedule
of portfolio holdings for the most recent quarter of their fiscal year available
on their Web site at americancentury.com and, upon request, by calling
1-800-345-2021.
INDEX DEFINITIONS
The following indices are used to illustrate investment market, sector, or style
performance or to serve as fund performance comparisons. They are not investment
products available for purchase.
The LEHMAN BROTHERS U.S. AGGREGATE INDEX represents securities that are taxable,
registered with the Securities and Exchange Commission, and U.S.
dollar-denominated. The index covers the U.S. investment-grade fixed-rate bond
market, with index components for government and corporate securities, mortgage
pass-through securities, and asset-backed securities.
The RUSSELL 3000(reg.tm) INDEX measures the performance of the 3,000 largest
U.S. companies based on total market capitalization, which represents
approximately 98% of the investable U.S. equity market. As of the latest
reconstitution, the average market capitalization was approximately $4 billion;
the median market capitalization was approximately $700 million. The index had a
total market capitalization range of approximately $309 billion to $128 million.
- ------
34
Notes
- ------
35
Notes
- ------
36
[inside back cover - blank]
[back cover]
CONTACT US
AMERICANCENTURY.COM
AUTOMATED INFORMATION LINE:
1-800-345-8765
INVESTOR SERVICES REPRESENTATIVE:
1-800-345-2021 or 816-531-5575
BUSINESS, NOT-FOR-PROFIT,
EMPLOYER-SPONSORED RETIREMENT PLANS:
1-800-345-3533
BANKS AND TRUST COMPANIES, BROKER-DEALERS,
FINANCIAL ADVISORS, INSURANCE COMPANIES:
1-800-345-6488
TELECOMMUNICATIONS DEVICE FOR THE DEAF:
1-800-634-4113 or 816-444-3485
AMERICAN CENTURY ASSET ALLOCATION PORTFOLIOS, INC.
INVESTMENT MANAGER:
American Century Investment Management, Inc.
Kansas City, Missouri
THIS REPORT AND THE STATEMENTS IT CONTAINS ARE SUBMITTED FOR THE GENERAL
INFORMATION OF OUR SHAREHOLDERS. THE REPORT IS NOT AUTHORIZED FOR DISTRIBUTION
TO PROSPECTIVE INVESTORS UNLESS PRECEDED OR ACCOMPANIED BY AN EFFECTIVE
PROSPECTUS.
The American Century Investments logo, American Century and American Century
Investments are service marks of American Century Proprietary Holdings, Inc.
American Century Investment Services, Inc., Distributor
0503 (c)2005 American Century Proprietary Holdings, Inc.
SH-SAN-42277N All rights reserved.
ITEM 2. CODE OF ETHICS.
Not applicable for semiannual report filings.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable for semiannual report filings.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable for semiannual report filings.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
The schedule of investments is included as part of the report to stockholders
filed under Item 1 of this Form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant's board has adopted procedures by which shareholders may
recommend nominees to the board.
The Governance Committee of the board is responsible for identifying, evaluating
and recommending qualified candidates for election to the board. While the
Governance Committee largely considers nominees from searches that it conducts,
the Committee will consider candidates submitted by shareholders. Any
shareholder wishing to submit a candidate for consideration should send the
following information to the Corporate Secretary, American Century Funds, 4500
Main Street, Kansas City, MO 64111-7709:
Shareholder's name, the fund name and number of fund shares owned and length of
period held;
Name, age and address of the candidate;
A detailed resume describing among other things the candidate's educational
background, occupation, employment history, financial knowledge and expertise
and material outside commitments (e.g., memberships on other boards and
committees, charitable foundations, etc.);
Any other information relating to the candidate that is required to be disclosed
in solicitations of proxies for election of directors in an election contest
pursuant to Regulation 14A under the Securities Exchange Act of 1934;
Number of fund shares owned by the candidate and length of time held;
A supporting statement which (i) describes the candidate's reasons for seeking
election to the Board of Directors and (ii) documents his/her ability to satisfy
the director qualifications described in the board's policy;
A signed statement from the candidate confirming his/her willingness to serve on
the Board of Directors.
The Corporate Secretary will promptly forward such materials to the Governance
Committee chairman. The Corporate Secretary also will maintain copies of such
materials for future reference by the Governance Committee when filling board
positions.
Shareholders may submit potential director candidates at any time pursuant to
these procedures. The Governance Committee will consider such candidates if a
vacancy arises or if the board decides to expand its membership, and at such
other times as the Governance Committee deems necessary or appropriate.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial
officer have concluded that the registrant's disclosure controls and
procedures (as defined in Rule 30a-3(c) under the Investment Company
Act of 1940) are effective based on their evaluation of these controls
and procedures as of a date within 90 days of the filing date of this
report.
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940) that occurred during the registrant's second
fiscal quarter of the period covered by this report that have
materially affected, or are reasonably likely to materially affect,
the registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable for semiannual report filings.
(a)(2) Separate certifications by the registrant's principal executive
officer and principal financial officer, pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment
Company Act of 1940, are filed and attached hereto as Exhibit
99.302CERT.
(a)(3) Not applicable.
(b) A certification by the registrant's chief executive officer and chief
financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, is furnished and attached hereto as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: AMERICAN CENTURY ASSET ALLOCATION PORTFOLIOS, INC.
By: /s/ William M. Lyons
-------------------------------------------------------
Name: William M. Lyons
Title: President
Date: March 31, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ William M. Lyons
-------------------------------------------------------
Name: William M. Lyons
Title: President
(principal executive officer)
Date: March 31, 2005
By: /s/ Maryanne L. Roepke
-------------------------------------------------------
Name: Maryanne L. Roepke
Title: Sr. Vice President, Treasurer, and
Chief Accounting Officer
(principal financial officer)
Date: March 31, 2005
