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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-03752
THE MANAGERS FUNDS
(Exact name of registrant as specified in charter)
800 Connecticut Avenue, Norwalk, Connecticut | 06854 | |
(Address of principal executive offices) | (Zip code) |
Managers Investment Group LLC
800 Connecticut Avenue, Norwalk, Connecticut 06854
(Name and address of agent for service)
Registrant’s telephone number, including area code: (203) 299-3500
Date of fiscal year end: | DECEMBER 31 |
Date of reporting period: | JANUARY 1, 2005 – JUNE 30, 2005 (Semi-Annual Shareholder Report) |
Table of Contents
Item 1. | REPORTS TO SHAREHOLDERS |
Table of Contents
Managers Funds
June 30, 2005
• | Managers Special Equity Fund |
Table of Contents
Letter to Shareholders | 1 | |
About Your Fund’s Expenses | 2 | |
Average Annual Total Returns | 3 | |
Fund Snapshots | 4 | |
Schedule of Portfolio Investments | 5 | |
Financial Statements | ||
9 | ||
Fund’s balance sheet, net asset value (NAV) per share computation and cumulative undistributed amount | ||
10 | ||
Detail of sources of income, Fund expenses, and realized and unrealized gains (losses) during the fiscal period | ||
11 | ||
Detail of changes in Fund assets for the past two fiscal periods | ||
Financial Highlights | ||
Historical net asset values per share, distributions, total returns, expense ratios, turnover ratios and net assets | 12 | |
Notes to Financial Statements | ||
Accounting and distribution policies, details of agreements and transactions with Fund management and description of certain investment risks | 13 | |
Annual Renewal of Investment Advisory Agreements | 16 |
Nothing contained herein is to be considered an offer, sale, or solicitation of an offer to buy shares of The Managers Funds. Such offering is made only by Prospectus, which includes details as to offering price and other material information.
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Dear Fellow Shareholder:
Over the past six months the Managers Funds family has taken a number of steps forward. Since we joined with two of our Affiliates early this year to form Managers Investment Group LLC, we have expanded the fund family, received a nationally recognized award, and added Web site improvements that we hope make it much easier for you to get information about your investments in our Funds.
We added the Managers AMG TimesSquare Mid Cap Growth Fund on March 4 and the Managers AMG TimesSquare Small Cap Growth Fund on April 11, both subadvised by TimesSquare Capital Management. TimesSquare is widely respected by financial advisors and retirement plan consultants, and we are pleased to add these two funds to our fund family.
I am also pleased to report that in March, Managers Funds was named Best Fixed Income Group in the smaller fund family category by Lipper, the mutual fund research and analysis company. The Lipper Fund Awards 2005 recognize fund families that deliver consistently strong relative performance for their funds’ shareholders. In the fixed income asset class, Managers Funds competed with 78 other eligible smaller fund groups to win the award.
The Managers Funds cited by the Lipper Fund Award are: Managers Bond (Long-Term Bond), Managers Fixed Income (Intermediate-Term Bond), Managers Global Bond (World Bond), Managers High Yield (High Yield Bond), Managers Intermediate Duration Government (Short-Term Government Bond) and Managers Short Duration Government (Ultra-short Bond).
Finally, if you have not visited our Web site recently, I urge you to do so. We have noticed an increase in traffic to the site, no doubt driven by the clean and clear look as well as the simplified access to fund information now available at www.managersinvest.com. If you invest with us directly, or through our ManagersChoice® program, I recommend that you sign up for account access so that you can have your account information readily available at any time. On our home page you will see a link to Access Your Account, which has information about how you can get started.
Please do visit our Web site if you have questions about your Funds, or call us toll free at 1-800-835-3879. Thank you for your continuing confidence in Managers Funds.
Respectfully,
Peter M. Lebovitz
President
The Managers Funds
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Table of Contents
About Your Fund’s Expenses (unaudited)
As a shareholder of a Fund, you may incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other Fund expenses. This Fund incurs only ongoing costs. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.
Actual Expenses
The first line of the table below provides information about the actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. 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 in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. 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 the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of 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), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Six Months Ended June 30, 2005 | Beginning Account 1/1/2004 | Ending Account 6/30/2005 | Expenses Paid During the Period* | ||||||
Managers Special Equity Fund | |||||||||
Actual | $ | 1,000 | $ | 980 | $ | 6.98 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,018 | $ | 7.11 | |||
Managers Special Equity Fund - I Shares | |||||||||
Actual | $ | 1,000 | $ | 981 | $ | 5.87 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019 | $ | 5.98 |
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by 181 (the number of days in the most recent fiscal half-year), then divided by 365. |
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Managers Special Equity Fund- All periods ended June 30, 2005 (unaudited)
Average Annual Total Returns | ||||||||||||||||||||
Six Months | 1 Year | 3 Years | 5 Years | 10 Years | Since Inception | Inception Date | ||||||||||||||
Special Equity | (1.98 | )% | 7.58 | % | 11.46 | % | (0.05 | )% | 12.32 | % | 13.59 | % | Jun. ’84 | |||||||
Special Equity - I Class | (1.87 | )% | 7.83 | % | — | — | — | 10.78 | % | May ’04 |
The performance data shown represents past performance, which is not a guarantee of future results. Current performance may be higher or lower than the performance data quoted. The investment return and principal value of an investment in the Funds will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. For performance information through the most recent month end please call (800) 835-3879 or visit our web site at www.managersinvest.com.
The listed returns on the Fund are net of expenses. All returns are in U.S. dollars($). Returns for periods greater than one year are annualized. From time to time the Fund’s advisor has waived fees or reimbursed expenses, which may have resulted in higher returns.
In choosing a Fund, investors should carefully consider the amount they plan to invest, their investment objectives, the Fund’s investment objectives, risks, charges and expenses before investing. For this and other information, please call (800) 835-3879 or visit our website at www.managersinvest.com for a free prospectus. Read it carefully before investing or sending money. Distributed by Managers Distributors, Inc., member NASD.
3
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As a percentage of Net Assets at June 30, 2005
Managers Special Equity Fund
Top Ten Holdings (out of 303 securities) | % Fund | ||
Toys “R” Us, Inc.* | 2.3 | % | |
Reliant Resources, Inc.* | 2.1 | ||
ITT Educational Services, Inc.* | 1.7 | ||
MI Developments, Inc., Class A* | 1.6 | ||
Dillard’s, Inc., Class A* | 1.5 | ||
Meristar Hospitality Corp.* | 1.2 | ||
FelCor Lodging Trust, Inc.* | 1.2 | ||
AK Steel Holding Corp.* | 0.9 | ||
ATMI, Inc. | 0.9 | ||
Downey Financial Corp. | 0.8 | ||
Top Ten as a Group | 14.2 | % | |
* | Top Ten Holding at December 31, 2004 |
Portfolio Breakdown | |||
Consumer Discretionary | 22.3 | % | |
Industrials | 17.2 | ||
Information Technology | 16.5 | ||
Financials | 15.8 | ||
Health Care | 10.5 | ||
Materials | 4.3 | ||
Utilities | 3.5 | ||
Energy | 2.3 | ||
Telecommunication Services | 0.6 | ||
Cash and other equivalents | 7.0 | ||
100 | % | ||
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June 30, 2005
Schedule of Portfolio Investments (unaudited) | Special Equity |
Security Description | Shares | Value | ||||
Common Stocks - 93.0% | ||||||
Consumer Discretionary - 22.3% | ||||||
ADVO, Inc.* | 290,233 | 2 | $ | 9,243,921 | ||
Aftermarket Technology Corp.* | 461,400 | 8,042,202 | ||||
American Eagle Outfitters, Inc. | 125,400 | 2 | 3,843,510 | |||
AnnTaylor Stores Corp.* | 665,500 | 2 | 16,158,340 | |||
Applebee’s International, Inc. | 388,125 | 10,281,431 | ||||
Beasley Broadcasting Group, Inc.* | 237,000 | 3,434,130 | ||||
Beazer Homes USA, Inc. | 481,975 | 2 | 27,544,871 | |||
Big 5 Sporting Goods Corp.* | 367,800 | 2 | 10,438,164 | |||
Big Lots, Inc.* | 757,152 | 2 | 10,024,692 | |||
Borders Group, Inc. | 551,300 | 13,953,403 | ||||
CBRL Group, Inc. | 501,230 | 2 | 19,477,798 | |||
Children’s Place Retail Stores, Inc.* | 340,950 | 2 | 15,912,137 | |||
Coldwater Creek, Inc.* | 795,100 | 2 | 19,805,941 | |||
COX Radio, Inc., Class A* | 368,600 | 2 | 5,805,450 | |||
Dillard’s, Inc., Class A | 2,296,200 | 2 | 53,777,003 | |||
Drew Industries, Inc.* | 220,000 | 9,988,000 | ||||
Duckwall-ALCO Stores, Inc.* | 200,000 | 4,296,000 | ||||
Emmis Communications Corp., Class A* | 703,069 | 2 | 12,423,226 | |||
Fleetwood Enterprises, Inc.* | 501,200 | 2 | 5,087,180 | |||
GameStop Corp.* | 183,300 | 2 | 5,995,743 | |||
Gaylord Entertainment Co., Class A* | 161,233 | 2 | 7,495,722 | |||
Genesco, Inc.* | 359,650 | 2 | 13,339,419 | |||
Getty Images, Inc.* | 134,200 | 2 | 9,965,692 | |||
Gildan Activewear, Inc., Class A* | 390,800 | 2 | 10,297,580 | |||
Goody’s Family Clothing, Inc. | 290,900 | 2,145,388 | ||||
Gymboree Corp.* | 1,291,900 | 17,647,354 | ||||
Hot Topic, Inc.* | 831,500 | 2 | 15,898,280 | |||
IMPCO Technologies, Inc.* | 399,400 | 2 | 1,921,114 | |||
Insight Communications Co., Inc., Class A* | 698,400 | 2 | 7,717,320 | |||
Journal Communications, Inc. | 411,000 | 6,904,800 | ||||
Kerzner International, Ltd.* | 348,300 | 2 | 19,835,685 | |||
La Quinta Corp.* | 845,000 | 2 | 7,883,850 | |||
Linens ‘N Things, Inc.* | 218,800 | 2 | 5,176,808 | |||
M. D. C. Holdings, Inc. | 189,590 | 2 | 15,593,778 | |||
Meritage Homes Corp.* | 331,500 | 2 | 26,354,250 | |||
Pacific Sunwear of California, Inc.* | 354,000 | 8,138,460 | ||||
Pier 1 Imports, Inc. | 236,800 | 2 | 3,360,192 | |||
Proquest Co.* | 392,700 | 2 | 12,876,633 | |||
Ross Stores, Inc. | 930,000 | 2 | 26,886,300 | |||
Ruby Tuesday, Inc. | 510,900 | 2 | 13,232,310 | |||
Ryland Group, Inc., The | 294,200 | 2 | 22,320,954 | |||
Saks, Inc. | 1,023,000 | 2 | 19,406,310 | |||
Salem Communications Corp., Class A* | 482,900 | 9,580,736 | ||||
School Specialty, Inc.* | 362,594 | 2 | 16,860,621 | |||
Source Interlink Companies, Inc.* | 321,100 | 2 | 3,972,007 | |||
Sports Authority, Inc.* | 417,700 | 2 | 13,282,860 | |||
Standard-Pacific Corp. | 285,500 | 2 | 25,109,725 | |||
Steak n Shake Co., The* | 204,800 | 3,813,376 | ||||
Talbots, Inc. | 236,800 | 7,688,896 | ||||
Tempur-Pedic International, Inc.* | 571,700 | 2 | 12,680,306 | |||
Texas Roadhouse, Inc., Class A* | 324,255 | 2 | 11,267,861 | |||
The Wet Seal, Inc., Class A* | 366,700 | 2,488,060 | ||||
Timberland Co.* | 233,900 | 2 | 9,056,608 | |||
TJX Cos., Inc. | 160,000 | 2 | 3,896,000 | |||
Toll Brothers, Inc.* | 150,000 | 2 | 15,232,500 | |||
Toys “R” Us, Inc.* | 3,100,000 | 82,088,000 | ||||
Visteon Corp. | 4,395,300 | 2 | 26,503,659 | |||
Total Consumer Discretionary | 783,452,556 | |||||
Energy - 2.3% | ||||||
Comstock Resources, Inc.* | 233,200 | 2 | 5,897,628 | |||
Houston Exploration Co.* | 217,700 | 11,548,985 | ||||
Key Energy Services, Inc.* | 648,300 | 7,818,498 | ||||
Newfield Exploration Co.* | 320,800 | 12,796,712 | ||||
OMI Corp. | 64,000 | 2 | 1,216,640 | |||
Overseas Shipholding Group, Inc. | 102,000 | 6,084,300 | ||||
Pogo Producing Co. | 484,200 | 2 | 25,139,664 | |||
Stone Energy Corp.* | 184,800 | 2 | 9,036,720 | |||
Total Energy | 79,539,147 | |||||
Financials - 15.8% | ||||||
Alabama National Bancorp | 64,400 | 2 | 4,209,828 | |||
American Financial Group, Inc. | 155,300 | 2 | 5,205,656 | |||
American National Insurance Co. | 68,950 | 7,907,876 | ||||
AmerUs Group, Co. | 284,000 | 2 | 13,646,200 | |||
Aspen Insurance Holdings, Ltd. | 357,500 | 9,852,700 | ||||
BankUnited Financial Corp.* | 601,088 | 2 | 16,253,420 | |||
Banner Corp. | 217,740 | 6,098,897 | ||||
Brown & Brown, Inc. | 265,100 | 2 | 11,913,594 | |||
Chicago Mercantile Exchange Holdings, Inc. | 67,700 | 2 | 20,005,350 | |||
Chittenden Corp. | 495,625 | 2 | 13,481,000 | |||
Clark, Inc.* | 400,700 | 5,742,031 | ||||
Commercial Capital Bancorp, Inc. | 360,900 | 2 | 6,030,639 | |||
Conseco, Inc.* | 494,500 | 2 | 10,789,990 | |||
Delphi Financial Group, Inc., Class A | 305,700 | 13,496,655 | ||||
Downey Financial Corp. | 393,380 | 2 | 28,795,416 | |||
F.N.B. Corp. | 116,000 | 2 | 2,279,400 | |||
FelCor Lodging Trust, Inc.* | 2,900,000 | 2 | 41,992,000 | |||
Fifth Third Bancorp | 315,724 | 2 | 13,010,986 | |||
Harbor Florida Bancshares, Inc. | 224,900 | 2 | 8,420,256 | |||
Hibernia Corp., Class A | 816,500 | 27,091,470 | ||||
Hilb, Rogal & Hamilton Co. | 305,500 | 2 | 10,509,200 | |||
Hudson United Bancorp | 41,100 | 2 | 1,483,710 |
The accompanying notes are an integral part of these financial statements.
5
Table of Contents
Managers Special Equity Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Special Equity |
Security Description | Shares | Value | ||||
Financials (continued) | ||||||
International Securities Exchange, Inc.* | 174,800 | 2 | $ | 4,389,228 | ||
Investment Technology Group, Inc.* | 471,100 | 9,902,522 | ||||
iStar Financial, Inc. | 347,500 | 14,452,525 | ||||
Jefferies Group, Inc. | 240,050 | 2 | 9,095,495 | |||
MCG Capital Corp. | 700,978 | 2 | 11,972,704 | |||
Meristar Hospitality Corp.*4 | 5,024,600 | 43,211,560 | ||||
MI Developments, Inc., Class A | 1,804,700 | 2 | 56,938,284 | |||
National Western Life Insurance Co., Class A* | 12,000 | 2,326,680 | ||||
Prime Group Realty Trust * | 786,800 | 5,680,696 | ||||
Prosperity Bancshares, Inc. | 301,700 | 8,631,637 | ||||
Provident Bankshares Corp. | 223,865 | 2 | 7,143,532 | |||
Reinsurance Group of America, Inc. | 272,200 | 2 | 12,660,022 | |||
Scottish Annuity & Life Holdings, Ltd. | 507,900 | 2 | 12,311,496 | |||
St. Joe Co., The | 111,500 | 2 | 9,091,710 | |||
Sterling Financial Corp.* | 531,737 | 2 | 19,886,964 | |||
Triad Guaranty, Inc.* | 103,482 | 2 | 5,214,458 | |||
U.S.I. Holdings Corp.* | 798,501 | 2 | 10,284,693 | |||
Webster Financial Corp. | 279,800 | 2 | 13,063,862 | |||
Westcorp, Inc. | 349,600 | 2 | 18,326,032 | |||
Total Financials | 552,800,374 | |||||
Health Care - 10.5% | ||||||
AMERIGROUP Corp.* | 557,425 | 2 | 22,408,485 | |||
Amsurg Corp.* | 102,100 | 2,827,149 | ||||
Apria Healthcare Group, Inc.* | 210,900 | 7,305,576 | ||||
Arthrocare Corp.* | 668,079 | 2 | 23,342,680 | |||
Centene Corp.* | 748,500 | 2 | 25,134,630 | |||
Cepheid, Inc.* | 701,500 | 5,149,010 | ||||
Charles River Laboratories International, Inc.* | 398,516 | 2 | 19,228,397 | |||
Da Vita, Inc.* | 351,600 | 2 | 15,990,768 | |||
DexCom, Inc.* | 206,700 | 2 | 2,581,683 | |||
Eclipsys Corp.* | 225,900 | 2 | 3,178,413 | |||
Emageon, Inc.* | 181,450 | 2,542,115 | ||||
ev3, Inc.* | 94,800 | 2 | 1,317,720 | |||
First Horizon Pharmaceutical Corp.* | 946,800 | 2 | 18,027,072 | |||
Fisher Scientific International, Inc.* | 60,000 | 2 | 3,894,000 | |||
Gen-Probe, Inc.* | 258,800 | 9,376,324 | ||||
Harvard Bioscience, Inc.* | 776,700 | 2,438,838 | ||||
IMS Health, Inc. | 820,081 | 20,313,406 | ||||
Intuitive Surgical, Inc.* | 348,525 | 16,255,206 | ||||
Kyphon, Inc.* | 142,800 | 2 | 4,968,012 | |||
LCA-Vision, Inc.* | 124,800 | 2 | 6,047,808 | |||
LifeCell Corp. | 248,800 | 2 | 3,933,528 | |||
Lifepoint Hospitals, Inc.* | 361,400 | 18,257,927 | ||||
Lincare Holdings, Inc.* | 212,100 | 2 | 8,662,164 | |||
Medicines Co.* | 327,660 | 7,663,967 | ||||
NeoPharm, Inc.* | 358,100 | 2 | 3,577,419 | |||
NitroMed, Inc.* | 138,900 | 2 | 2,701,605 | |||
Owens & Minor, Inc. | 213,300 | 2 | 6,900,255 | |||
Par Pharmaceutical Co., Inc. | 280,500 | 2 | 8,922,705 | |||
Priority Healthcare Corp., Class B* | 229,122 | 2 | 5,810,534 | |||
Resmed, Inc.* | 209,950 | 2 | 13,854,601 | |||
Techne Corp.* | 146,200 | 2 | 6,712,042 | |||
Telik, Inc.* | 238,200 | 2 | 3,873,132 | |||
Thoratec Corp.* | 522,400 | 2 | 8,013,616 | |||
Triad Hospitals, Inc.* | 451,264 | 24,657,065 | ||||
United Therapeutics Corp.* | 268,100 | 2 | 12,922,420 | |||
Universal Health Services, Inc., Class B | 170,000 | 2 | 10,570,600 | |||
VCA Antech, Inc.* | 123,550 | 2 | 2,996,088 | |||
WellCare Health Plans, Inc.* | 163,300 | 5,798,783 | ||||
Total Health Care | 368,155,743 | |||||
Industrials - 17.2% | ||||||
AAR Corp.* | 259,200 | 4,072,032 | ||||
Acuity Brands, Inc. | 433,253 | 2 | 11,130,270 | |||
Air France | 948,178 | 14,421,787 | ||||
Airtran Holdings, Inc.* | 1,664,500 | 2 | 15,363,335 | |||
Alaska Airgroup, Inc.* | 615,000 | 2 | 18,296,250 | |||
Albany International Corp. | 307,200 | 2 | 9,864,192 | |||
Asset Acceptance Capital Corp.* | 362,900 | 2 | 9,402,739 | |||
Axsys Technologies, Inc.* | 346,650 | 6,118,719 | ||||
BE Aerospace, Inc.* | 582,500 | 2 | 9,104,475 | |||
Brink’s Co., The | 420,241 | 15,128,676 | ||||
Bucyrus International, Inc. | 344,400 | 13,080,312 | ||||
Builders FirstSource, Inc.* | 197,300 | 2 | 3,196,260 | |||
Carlisle Co., Inc. | 140,300 | 2 | 9,628,789 | |||
CNF, Inc. | 105,600 | 4,741,440 | ||||
Continental Airlines, Inc.* | 877,900 | 2 | 11,658,512 | |||
CoStar Group, Inc.* | 412,530 | 2 | 17,986,308 | |||
Crane Co. | 461,100 | 2 | 12,126,930 | |||
Cuno, Inc.* | 94,100 | 6,722,504 | ||||
Curtiss-Wright Corp. | 133,700 | 2 | 7,213,115 | |||
De Vry, Inc.* | 658,200 | 2 | 13,098,180 | |||
Dycom Industries, Inc.* | 943,200 | 2 | 18,684,792 | |||
EGL, Inc.* | 263,500 | 2 | 5,354,320 | |||
EnerSys * | 395,100 | 5,385,213 | ||||
First Advantage Corp.* | 152,300 | 3,550,113 | ||||
Flowserve Corp.* | 245,200 | 2 | 7,419,752 | |||
Hudson Highland Group, Inc.* | 443,200 | 6,909,488 | ||||
Insituform Technologies, Inc.* | 594,800 | 2 | 9,534,644 | |||
Interpool, Inc. | 424,300 | 9,071,534 | ||||
ITT Educational Services, Inc.* | 1,139,700 | 2 | 60,882,773 |
The accompanying notes are an integral part of these financial statements.
6
Table of Contents
Managers Special Equity Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Special Equity |
Security Description | Shares | Value | ||||
Industrials (continued) | ||||||
Jacuzzi Brands, Inc.* | 683,300 | $ | 7,331,809 | |||
JetBlue Airways Corp.* | 570,300 | 2 | 11,656,932 | |||
JLG Industries, Inc. | 388,600 | 2 | 10,678,728 | |||
Joy Global, Inc. | 261,000 | 2 | 8,766,990 | |||
Knoll, Inc. | 193,025 | 2 | 3,302,658 | |||
Laidlaw International, Inc.* | 559,100 | 13,474,310 | ||||
Lydall, Inc.* | 234,000 | 2,017,080 | ||||
Mercury Computer Systems, Inc.* | 388,300 | 10,627,771 | ||||
NCI Building Systems, Inc.* | 277,300 | 2 | 9,095,440 | |||
Nuco2, Inc.* | 69,300 | 1,778,931 | ||||
Overnite Corp. | 164,880 | 7,086,542 | ||||
Pacer International, Inc.* | 397,600 | 2 | 8,663,704 | |||
Portfolio Recovery Associates, Inc.* | 506,400 | 2 | 21,278,927 | |||
Precision Castparts Corp. | 80,100 | 6,239,790 | ||||
Royal Group Technologies Ltd.* | 780,000 | 8,541,000 | ||||
Ryder System, Inc. | 183,800 | 2 | 6,727,080 | |||
Sea Containers, Ltd., Class A | 795,900 | 12,710,523 | ||||
Sea Containers, Ltd., Class B | 13,890 | 220,018 | ||||
Sequa Corp., Class A* | 99,600 | 2 | 6,590,532 | |||
Sequa Corp., Class B* | 38,300 | 2,548,865 | ||||
Shaw Group Inc., The* | 509,600 | 10,961,496 | ||||
Steelcase, Inc. | 826,900 | 2 | 11,452,565 | |||
Swift Transportation Co., Inc.* | 421,000 | 2 | 9,805,090 | |||
Tecumseh Products Co., Class B | 168,700 | 4,662,531 | ||||
Thomas & Betts Corp.* | 653,500 | 18,454,840 | ||||
Trinity Industries, Inc. | 13,500 | 2 | 432,405 | |||
United Stationers, Inc.* | 237,200 | 2 | 11,646,520 | |||
URS Corp.* | 350,150 | 13,078,103 | ||||
Volt Information Sciences, Inc.* | 69,350 | 1,645,676 | ||||
Washington Group International, Inc.* | 97,150 | 2 | 4,966,308 | |||
Watson Wyatt & Co. | 338,900 | 8,686,007 | ||||
York International Corp. | 237,200 | 2 | 9,013,600 | |||
Total Industrials | 603,290,225 | |||||
Information Technology - 16.5% | ||||||
3Com Corp.* | 4,368,600 | 2 | 15,901,704 | |||
Actel Corp.* | 642,700 | 8,933,530 | ||||
Aladdin Knowledge Systems, Ltd.* | 310,100 | 6,369,454 | ||||
Anaren Microwave, Inc.*4 | 1,057,900 | 13,911,385 | ||||
Applied Films Corp.* | 296,800 | 2 | 7,598,080 | |||
aQuantive, Inc.* | 852,800 | 2 | 15,111,616 | |||
ASM International NV* | 319,100 | 2 | 5,073,690 | |||
ATMI, Inc.* | 1,051,400 | 2 | 30,501,113 | |||
AudioCodes, Ltd.* | 1,276,300 | 2 | 12,699,185 | |||
Audiovox Corp., Class A* | 256,900 | 3,981,950 | ||||
Avid Technology, Inc.* | 394,500 | 2 | 21,018,960 | |||
Belden CDT, Inc. | 490,100 | 2 | 10,390,120 | |||
Benchmark Electronics, Inc.* | 407,600 | 2 | 12,399,192 | |||
Centra Software, Inc.* | 321,400 | 642,800 | ||||
CheckFree Corp.* | 80,700 | 2 | 2,748,642 | |||
Checkpoint Systems, Inc.* | 401,200 | 2 | 7,101,240 | |||
Cogent, Inc.* | 42,300 | 2 | 1,207,665 | |||
Cognizant Technology Solutions Corp.* | 356,986 | 2 | 16,824,750 | |||
CommScope, Inc.* | 537,900 | 2 | 9,364,839 | |||
CTS Corp. | 929,800 | 11,427,242 | ||||
Digitas, Inc.* | 630,500 | 7,194,005 | ||||
ECI Telecommunications, Ltd. | 743,300 | 2 | 6,169,390 | |||
eFunds Corp.* | 480,626 | 2 | 8,646,462 | |||
Electronics for Imaging, Inc.* | 442,681 | 2 | 9,314,008 | |||
Equinix, Inc.* | 330,300 | 2 | 14,315,202 | |||
Exfo Electro-Optical Engineering, Inc.* | 1,893,100 | 2 | 8,216,054 | |||
F5 Networks, Inc.* | 271,600 | 2 | 12,829,026 | |||
Fairchild Semiconductor International, Inc.* | 1,223,700 | 2 | 18,049,575 | |||
FARO Technologies, Inc.* | 241,000 | 2 | 6,569,660 | |||
Formfactor, Inc.* | 40,000 | 2 | 1,056,800 | |||
Global Payments, Inc. | 121,400 | 2 | 8,230,920 | |||
Hyperion Solutions Corp.* | 173,700 | 6,989,688 | ||||
Identix, Inc.* | 2,885,100 | 2 | 14,512,053 | |||
infoUSA, Inc.* | 356,600 | 4,172,220 | ||||
Intevac, Inc.*4 | 1,047,900 | 10,971,513 | ||||
Ixia, Inc.* | 263,275 | 2 | 5,118,066 | |||
Kanbay International, Inc.* | 224,500 | 5,188,195 | ||||
Keithley Instruments, Inc. | 500,000 | 7,705,000 | ||||
Komag, Inc. | 100,200 | 2,842,674 | ||||
Lionbridge Technologies, Inc.* | 741,400 | 2 | 5,026,692 | |||
MEMC Electronic Materials, Inc.* | 828,600 | 2 | 13,067,022 | |||
Mentor Graphics Corp.* | 731,500 | 2 | 7,497,875 | |||
MRO Software, Inc.* | 584,900 | 8,545,389 | ||||
Nanometrics, Inc.* | 235,800 | 2 | 2,945,142 | |||
Netgear, Inc.* | 233,100 | 2 | 4,335,660 | |||
Netscout Systems, Inc.* | 842,600 | 5,552,734 | ||||
Parametric Technology Corp.* | 1,100,200 | 2 | 7,019,276 | |||
Park Electrochemical Corp. | 264,300 | 6,660,360 | ||||
PowerDsine Ltd.* | 485,900 | 4,859,000 | ||||
Powerwave Technologies, Inc.* | 815,100 | 2 | 8,330,322 | |||
Reynolds & Reynolds Co., The, Class A | 115,000 | 2 | 3,108,450 | |||
RightNow Technologies, Inc.* | 536,200 | 2 | 6,445,124 | |||
Rogers Corp.* | 153,400 | 2 | 6,220,370 | |||
Salesforce.com, Inc.* | 703,500 | 2 | 14,407,680 | |||
ScanSource, Inc.* | 114,100 | 2 | 4,899,454 | |||
SERENA Software, Inc.* | 486,500 | 2 | 9,389,450 | |||
SupportSoft, Inc.* | 498,100 | 2,585,139 | ||||
Symmetricom, Inc.* | 521,500 | 2 | 5,407,955 | |||
SYNNEXCorp.* | 327,400 | 5,732,774 |
The accompanying notes are an integral part of these financial statements.
7
Table of Contents
Managers Special Equity Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Special Equity |
Security Description | Shares | Value | |||||
Information Technology (continued) | |||||||
Synopsys, Inc.* | 170,000 | 2 | $ | 2,833,900 | |||
Take-Two Interactive Software, Inc.* | 266,700 | 2 | 6,787,515 | ||||
TALX Corp.* | 198,350 | 5,734,299 | |||||
Terayon Communication Systems, Inc.* | 3,712,300 | 11,471,007 | |||||
Trident Microsystems, Inc.* | 895,875 | 2 | 20,327,404 | ||||
Varian Semiconductor Equipment Associates, Inc.* | 255,700 | 2 | 9,460,900 | ||||
Vishay Intertechnology, Inc.* | 713,900 | 2 | 8,473,993 | ||||
Witness Systems, Inc.* | 235,600 | 4,294,988 | |||||
Woodhead Industries, Inc. | 434,000 | 5,472,740 | |||||
Total Information Technology | 578,190,282 | ||||||
Materials - 4.3% | |||||||
Airgas, Inc. | 705,000 | 2 | 17,392,350 | ||||
AK Steel Holding Corp.4* | 4,929,400 | 2 | 31,597,454 | ||||
Cytec Industries, Inc. | 360,900 | 2 | 14,363,820 | ||||
Longview Fibre Co. | 659,900 | 2 | 13,560,945 | ||||
Lubrizol Corp. | 439,000 | 2 | 18,442,390 | ||||
RTI International Metals, Inc.* | 68,000 | 2,135,880 | |||||
Scotts Co., The, Class A* | 144,300 | 2 | 10,275,603 | ||||
Spartech Corp. | 590,500 | 2 | 10,510,900 | ||||
Stillwater Mining Co.* | 1,168,900 | 2 | 8,673,238 | ||||
Symyx Technologies, Inc.* | 735,000 | 2 | 20,565,300 | ||||
Wheeling-Pittsburgh Corp.* | 202,954 | 2 | 3,121,433 | ||||
Total Materials | 150,639,313 | ||||||
Telecommunication Services - 0.6% | |||||||
General Communication, Inc., Class A* | 878,100 | 2 | 8,666,847 | ||||
RADWARE, Ltd.* | 287,900 | 5,205,232 | |||||
Syniverse Holdings, Inc. | 537,900 | 7,530,600 | |||||
Total Telecommunication Services | 21,402,679 | ||||||
Utilities - 3.5% | |||||||
Avista Corp. | 1,202,200 | 22,348,898 | |||||
Reliant Resources, Inc.* | 5,991,000 | 2 | 74,168,580 | ||||
Sierra Pacific Resources Corp.* | 2,124,900 | 2 | 26,455,005 | ||||
Total Utilities | 122,972,483 | ||||||
Total Common Stocks | 3,260,442,802 | ||||||
Warrants - 0.0% | |||||||
Air France, ADR | 861,980 | 362,032 | |||||
Other Investment Companies - 31.2%1 | |||||||
AIM Liquid Assets Portfolio Institutional Class Shares, 3.13% | 20,428,197 | 20,428,197 | |||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 830,843,746 | 830,843,746 | |||||
JPMorgan Prime Money Market Fund, Institutional Class Shares, 3.04% | 119,212,789 | 119,212,739 | |||||
Vanguard Prime Money Market Fund, 2.90% | 120,541,186 | 120,541,186 | |||||
Total Other Investment Companies | 1,091,025,868 | ||||||
Total Investments - 124.2% | 4,351,830,702 | ||||||
Other Assets, less Liabilities - (24.2)% | (847,260,164 | ) | |||||
Net Assets - 100.0% | $ | 3,504,570,538 |
Based on the approximate cost of investments of $3,643,986,423 for Federal income tax purposes at June 30, 2005, the aggregate gross unrealized appreciation and depreciation were $799,277,077 and $91,432,798, respectively, resulting in net unrealized appreciation of investments of $707,844,279.
* | Non-income-producing securities. |
1 | Yield shown for an investment company represents the June 30, 2005, seven-day average yield, which refers to the sum of the previous seven days’ dividends paid, expressed as an annual percentage. |
2 | Some or all of these shares were out on loan to various brokers as of June 30, 2005, amounting to a market value of $811,266,068, or approximately 23.1% of net assets. |
3 | Collateral received from brokers for securities lending was invested in this short-term investment. |
4 | Affiliated Company – See Note 6 in the Notes to Financial Statements. |
The accompanying notes are an integral part of these financial statements.
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Statement of Assets and Liabilities
June 30, 2005 (unaudited)
Managers Special Equity Fund | ||||
Assets: | ||||
Investments at value (including securities on loan valued at $830,843,746) | $ | 4,351,830,702 | ||
Receivable for investments sold | 25,510,186 | |||
Receivable for Fund shares sold | 1,888,862 | |||
Dividends, interest and other receivables | 1,890,322 | |||
Prepaid expenses | 102,485 | |||
Total assets | 4,381,222,557 | |||
Liabilities: | ||||
Payable for Fund shares repurchased | 2,010,155 | |||
Payable upon return of securities loaned | 830,843,746 | |||
Payable for investments purchased | 38,617,323 | |||
Accrued expenses: | ||||
Investment advisory and management fees | 2,606,862 | |||
Administrative fees | 724,128 | |||
Other | 1,849,805 | |||
Total liabilities | 876,652,019 | |||
Net Assets | $ | 3,504,570,538 | ||
Net Assets | $ | 3,119,409,502 | ||
Shares outstanding | 35,200,744 | |||
Net asset value, offering and redemption price per share | $ | 88.62 | ||
I Class Shares: | ||||
Net Assets | $ | 385,161,036 | ||
Shares outstanding | 4,335,043 | |||
Net asset value, offering and redemption price per share | $ | 88.85 | ||
Net Assets Represent: | ||||
Paid-in capital | $ | 2,700,229,041 | ||
Undistributed net investment loss | (12,056,151 | ) | ||
Accumulated net realized gain from investments, futures and foreign currency transactions | 87,492,423 | |||
Net unrealized appreciation of investments, futures and foreign currency contracts and translations | 728,905,225 | |||
Net Assets | $ | 3,504,570,538 | ||
* Investments at cost | $ | 3,622,925,477 |
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For the six months ended June 30, 2005 (unaudited)
Managers Special Equity Fund | ||||
Investment Income: | ||||
Dividend income | $ | 11,286,857 | ||
Foreign withholding tax | (93,319 | ) | ||
Securities lending fees | 528,390 | |||
Total investment income | 11,721,928 | |||
Expenses: | ||||
Investment management fees | 15,718,182 | |||
Administrative fees | 4,366,162 | |||
Transfer agent | 4,101,012 | |||
Custodian | 304,108 | |||
Professional fees | 191,106 | |||
Trustees fees and expenses | 75,526 | |||
Registration fees | 51,867 | |||
Miscellaneous | 187,010 | |||
Total expenses before offsets | 24,994,973 | |||
Fee waiver | (28,665 | ) | ||
Expense reductions | (529,661 | ) | ||
Net expenses | 24,436,647 | |||
Net investment loss | (12,714,719 | ) | ||
Net Realized and Unrealized Gain (Loss): | ||||
Net realized gain on investment transactions | 143,939,532 | |||
Net unrealized depreciation of investments | (207,205,273 | ) | ||
Net realized and unrealized loss | (63,265,741 | ) | ||
Net Decrease in Net Assets Resulting from Operations | $ | (75,980,460 | ) | |
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Statement of Changes in Net Assets
For the six months ended June 30, 2005, (unaudited) and for the year ended December 31,
Managers Special Equity Fund | ||||||||
2005 | 2004 | |||||||
Increase (Decrease) in Net Assets | ||||||||
From Operations: | ||||||||
Net investment loss | $ | (12,714,719 | ) | $ | (22,980,406 | ) | ||
Net realized gain on investments | 143,939,532 | 347,977,454 | ||||||
Net unrealized appreciation (depreciation) of investments | (207,205,273 | ) | 156,903,987 | |||||
Net increase (decrease) in net assets resulting from operations | (75,980,460 | ) | 481,901,035 | |||||
From Capital Share Transactions: | ||||||||
Managers Shares: | ||||||||
Proceeds from sale of shares | 446,404,641 | 303,268,419 | ||||||
Cost of shares repurchased | (669,426,417 | ) | (1,287,267,301 | ) | ||||
Net decrease from capital share transactions | (223,021,776 | ) | (983,998,882 | ) | ||||
I Class Shares | ||||||||
Proceeds from sale of shares | 151,377,290 | 971,313,866 | ||||||
Cost of shares repurchased | (36,817,223 | ) | (59,521,580 | ) | ||||
Net increase from capital share transactions | 114,560,067 | 911,792,286 | ||||||
Net decrease in net assets | (108,461,710 | ) | (72,206,596 | ) | ||||
Total increase (decrease) in net assets | (184,442,170 | ) | 409,694,439 | |||||
Net Assets: | ||||||||
Beginning of period | 3,689,012,708 | 3,279,318,270 | ||||||
End of period | $ | 3,504,570,538 | $ | 3,689,012,708 | ||||
End of period undistributed net investment income (loss) | $ | (12,056,151 | ) | $ | 658,568 | |||
Share Transactions: | ||||||||
Managers Shares: | ||||||||
Sale of shares | 5,131,170 | 12,009,151 | ||||||
Shares repurchased | (7,697,519 | ) | (16,026,228 | ) | ||||
Net decrease in shares | (2,566,349 | ) | (4,017,077 | ) | ||||
I Class Shares: | ||||||||
Sale of shares | 1,732,638 | 3,770,486 | ||||||
Shares repurchased | (423,437 | ) | (744,644 | ) | ||||
Net increase in shares | 1,309,201 | 3,025,842 | ||||||
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For a share outstanding throughout the six months ended June 30, 2005, (unaudited) and each year ended December 31,
Managers Special Equity Fund - Managers Class | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 90.42 | $ | 78.48 | $ | 55.08 | $ | 70.59 | $ | 76.82 | $ | 91.42 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment loss | (0.32 | ) | (0.56 | ) | (0.43 | ) | (0.34 | ) | (0.18 | ) | (0.12 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (1.48 | ) | 12.50 | 23.83 | (15.17 | ) | (6.05 | ) | (2.71 | ) | ||||||||||||||
Total from investment operations | (1.80 | ) | 11.94 | 23.40 | (15.51 | ) | (6.23 | ) | (2.83 | ) | ||||||||||||||
Less Distributions to | ||||||||||||||||||||||||
Net realized gain (loss) on investments | — | — | — | — | — | (11.77 | ) | |||||||||||||||||
Net Asset Value, End of Period | $ | 88.62 | $ | 90.42 | $ | 78.48 | $ | 55.08 | $ | 70.59 | $ | 76.82 | ||||||||||||
Total Return 1 | (1.98 | )%2 | 15.18 | % | 42.50 | % | (21.98 | )% | (8.07 | )% | (2.56 | )% | ||||||||||||
Ratio of net expenses to average net assets 1 | 1.42 | %3 | 1.40 | % | 1.43 | % | 1.31 | % | 1.29 | % | 1.26 | % | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.45 | %3,4 | 1.45 | %4 | 1.46 | %4 | 1.32 | % | 1.30 | % | 1.26 | % | ||||||||||||
Ratio of net investment loss to average net assets | (0.75 | )%3 | (0.69 | )% | (0.72 | )% | (0.56 | )% | (0.27 | )% | (0.16 | )% | ||||||||||||
Portfolio turnover | 50 | %2 | 68 | % | 64 | % | 67 | % | 62 | % | 69 | % | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 3,119,410 | $ | 3,415,003 | $ | 3,279,318 | $ | 2,020,821 | $ | 2,295,234 | $ | 2,132,376 | ||||||||||||
For a share outstanding throughout each period shown
Managers Special Equity Fund - I Class | ||||||||
For the six months (unaudited) | For the period* ended December 31, 2004 | |||||||
Net Asset Value, Beginning of Period | $ | 90.56 | $ | 78.91 | ||||
Income from Investment Operations: | ||||||||
Net investment loss | (0.20 | ) | (0.21 | ) | ||||
Net realized and unrealized gain (loss) on investments | (1.51 | ) | 11.86 | |||||
Total from investment operations | (1.71 | ) | 11.65 | |||||
Net Asset Value, End of Period | $ | 88.85 | $ | 90.56 | ||||
Total Return 1 | (1.87 | )%2 | 14.75 | %2 | ||||
Ratio of net expenses to average net assets 1 | 1.19 | %3 | 1.20 | %3 | ||||
Ratio of total expenses to average net assets 1 | 1.22 | %3,4 | 1.26 | %3,4 | ||||
Ratio of net investment loss to average net assets | (0.39 | )%3 | (0.49 | )%3 | ||||
Portfolio turnover | 50 | %2 | 68 | %2 | ||||
Net assets at end of period (000’s omitted) | $ | 385,161 | $ | 274,010 | ||||
* | Commencement of operations was May 3, 2004. |
1 | See Note l(c) of “Notes to Financial Statements.” |
2 | Not Annualized. |
3 | Annualized. |
4 | Excludes the impact of fee waivers and expense offsets such as brokerage credits, but includes non-reimbursable expenses such as interest and taxes. (See Note 1c to the Notes to Financial Statements.) |
12
Table of Contents
Notes to Financial Statements (unaudited)
June 30, 2005
(1) Summary of Significant Accounting Policies
The Managers Funds (the “Trust”) is an open-end management investment company organized as a Massachusetts business trust and registered under the Investment Company Act of 1940, as amended (the “1940 Act”). Currently, the Trust is comprised of a number of investment series. Included in this report is the Managers Special Equity Fund (the “Fund”).
Special Equity offers both Managers Class shares and I Class shares. The I Class shares, which are designed primarily for institutional investors that meet certain administrative and servicing criteria, have a minimum investment of $2,500,000. Managers Class shares are offered to all other investors. Each class represents interest in the same assets of Special Equity and the classes are identical except for class specific expenses related to shareholder activity. Investment income, realized and unrealized capital gains and losses, the common expenses of Special Equity, and certain Fund level expense reductions, if any, are allocated on a pro rata basis to each class based on the relative net assets of each class to the total net assets of Special Equity. Both classes have equal voting privileges except that each class has exclusive voting rights with respect to its services and/or distribution plan.
The Fund’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting periods. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements:
(a) Valuation of Investments
Equity securities traded on a domestic or international securities exchange are generally valued at the last quoted sale price, or, lacking any sales, at the last quoted bid price. Over-the-counter securities are valued at the Nasdaq Official Closing Price, if one is available. Lacking any sales, over-the-counter securities, are valued at the last quoted bid price. Under certain circumstances, the value of a Fund investment may be based on an evaluation of its fair value, pursuant to procedures established by and under the general supervision of the Board of Trustees of the Fund. A Fund may use the fair value of a portfolio security to calculate its NAV when, for example, (1) market quotations are not readily available because a portfolio security is not traded in a public market or the principal market in which the security trades is closed, (2) trading in a portfolio security is suspended and not resumed prior to the time as of which the Fund calculates its NAV, (3) the Investment Manager determines that a market quotation is inaccurate, or (4) where a significant event affecting the value of a portfolio security is determined to have occurred between the time of the market quotation provided for a portfolio security and the time as of which the Fund calculates its NAV. The Manager monitors intervening events that may affect the value of securities held in each Fund’s portfolio and, in accordance with procedures adopted by the Funds’ Trustees, will adjust the prices of securities traded in foreign markets, as appropriate, to reflect the impact of events occurring subsequent to the close of such markets but prior to the time each Fund’s NAV is calculated. Fixed-income securities are valued based on valuations furnished by independent pricing services that utilize matrix systems, which reflect such factors as security prices, yields, maturities and ratings, and are supplemented by dealer and exchange quotations. Short-term investments having a remaining maturity of 60 days or less are valued at amortized cost, which approximates market value. Investments in other regulated investment companies are valued at their end of day net asset value per share except iShares or other ETF’s, which are valued the same as equity securities. Securities (including derivatives) for which market quotations are not readily available are valued at fair value, as determined in good faith, and pursuant to procedures adopted by the Board of Trustees of the Trust.
Investments in certain securities such as preferred stocks are valued on the basis of valuations provided by dealers or by a pricing service which uses information with respect to transactions in such securities, various relationships between securities in determining value.
(b) Security Transactions
Security transactions are accounted for as of the trade date. Realized gains and losses on securities sold are determined on the basis of identified cost.
The Fund had certain portfolio trades directed to a broker under a brokerage recapture program. For the period ended June 30, 2005, under this arrangement the total amount by which the cost of the Fund’s securities were reduced or proceeds on sales increased was $246,255.
(c) Investment Income and Expenses
Dividend income is recorded on the ex-dividend date except certain dividends from foreign securities where the ex-dividend date may have passed. These dividends are recorded as soon as the Trust is informed of the ex-dividend date. Dividend income on foreign securities is recorded net of any withholding tax. Interest income, which includes amortization of premium and accretion of discount on debt securities, is accrued as earned. Non-cash dividends included in dividend income, if any, are reported at the fair market value of the securities received. Other income and expenses are recorded on an accrual basis. Expenses that cannot be directly attributed to a fund are apportioned among the Funds in the Trust and in some cases other affiliated funds based upon their relative average net assets or number of shareholders.
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Table of Contents
Notes to Financial Statements (continued)
The Fund had certain portfolio trades directed to various brokers who paid a portion of the Fund’s expenses. For the period ended June 30, 2005, under this arrangement the Fund’s expenses were reduced and the impact on the expense ratio was $524,231 or 0.01%.
The Fund has a “balance credit” arrangement with The Bank of New York (“BNY”), the Fund’s custodian, whereby the Fund is credited with an interest factor equal to 1% below the effective 90-day T-Bill rate for account balances left uninvested overnight. This credit serves to reduce the custody expense that would otherwise be charged to the Fund. For the six months ended June 30, 2005, the custodian expense was reduced $5,430 under this arrangement.
Managers Investment Group, LLC (formerly The Managers Funds LLC) (the “Investment Manager”) had agreed to waive a portion of its fee or reimburse expenses of Special Equity commensurate with the reduction in the fee paid to Essex Investment Management Company LLC (“Essex”) (subadvisor to Special Equity from December 19, 2003 to January 17, 2005), which was 0.10% of the average daily net assets of the portion of the Fund managed by Essex in excess of $100 million. From January 1, 2005 to January 17, 2005 the amount waived equaled $28,665. On January 18, 2005, Essex was replaced with Veredus Asset Management, and the Investment Manager discontinued waiving a portion of its fee.
Total returns and net investment income for the Fund would have been lower had certain expenses not been offset.
(d) Dividends and Distributions
Dividends resulting from net investment income, if any, normally will be declared and paid annually. Distributions of capital gains, if any, will be made on an annual basis and when required for Federal excise tax purposes. Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from generally accepted accounting principles. These differences are primarily due to differing treatments for losses deferred due to wash sales, equalization accounting for tax purposes, foreign currency and market discount transactions. Permanent book and tax basis differences, if any, relating to shareholder distributions will result in reclassifications to paid-in capital.
(e) Federal Taxes
The Fund intends to comply with the requirements under Subchapter M of the Internal Revenue Code of 1986, as amended, to distribute substantially all of its taxable income and gains to its shareholders and to meet certain diversification and income requirements with respect to investment companies. Therefore, no provision for Federal income or excise tax is included in the accompanying financial statements.
(f) Capital Loss Carryovers
As of June 30, 2005, the Fund had an accumulated net realized capital loss carryover from securities transactions for Federal income tax purposes of $34,727,595 expiring December 31, 2010.
(g) Capital Stock
The Trust’s Declaration of Trust authorizes for each series the issuance of an unlimited number of shares of beneficial interest, without par value. The Fund records sales and repurchases of its capital stock on the trade date. Dividends and distributions to shareholders are recorded on the ex-dividend date.
At June 30, 2005, certain unaffiliated shareholders, specifically omnibus accounts, individually held greater than 10% of the outstanding shares of the Fund: Special Equity Managers Class shares - one owns 23%; Special Equity I Class shares – three own 42%.
(2) Agreements and Transactions with Affiliates
The Trust has entered into an Investment Management Agreement under which the Investment Manager provides or oversees investment management services to the Fund. The Investment Manager selects subadvisors for the Fund (subject to Trustee approval), allocates assets among subadvisors and monitors the subadvisor’s investment programs and results. The Fund’s investment portfolio is managed by portfolio managers who serve pursuant to Subadvisory Agreements with the Investment Manager. Investment management fees are paid directly by the Fund to the Investment Manager based on average daily net assets. The annual investment management fee rate, as a percentage of average daily net assets for the six months ended June 30, 2005 was 0.90%.
The Trust has entered into an Administration and Shareholder Servicing Agreement under which Managers Investment Group LLC serves as the Fund’s administrator (the “Administrator”) and is responsible for all aspects of managing the Fund’s operations, including administration and shareholder services to the Fund, its shareholders, and certain institutions, such as bank trust departments, broker-dealers and registered investment advisers, that advise or act as an intermediary with the Fund’s shareholders. During the period ended June 30, 2005, the Fund paid a fee to the Administrator at the rate of 0.25% per annum of the Fund’s average daily net assets.
The aggregate annual retainer paid to each independent Trustee for all Trusts in the Fund Family is $52,000, plus $2,000 for each meeting attended. The Trustees’ fees and expenses are allocated amongst all of the Funds for which Managers Investment Group
14
Table of Contents
Notes to Financial Statements (continued)
LLC serves as the Advisor based on the relative net assets of such Funds. The Independent Chairman of the Trusts receives an additional payment of $5,000 per year. The “Trustee fees and expenses” shown in the financial statements represents the Fund’s allocated portion of the total fees and expenses paid by the Fund and other affiliated funds in the Trust and in the complex.
The Fund is distributed by Managers Distributors, Inc. (“MDI”), a wholly-owned subsidiary of Managers Investment Group LLC. Certain Trustees and Officers of the Fund are Officers and/or Directors of the Investment Manager, AMG and/or MDI. Managers Distributors, Inc. (the “Distributor”) serves as the principal underwriter for the Fund. The Distributor is a registered broker-dealer and member of the National Association of Securities Dealers, Inc. (“NASD”). Shares of the Fund will be continuously offered and will be sold by brokers, dealers or other financial intermediaries who have executed selling agreements with the Distributor. The Distributor bears all the expenses of providing services pursuant to an Underwriting Agreement, including the payment of the expenses relating to the distribution of Prospectuses for sales purposes and any advertising or sales literature.
(3) Purchases and Sales of Securities
Purchases and sales of securities, excluding short-term securities, for the six months ended June 30, 2005, were $1,617,875,639 and $1,770,865,264, respectively. There were no purchases or sales of U.S. Government securities.
(4) Portfolio Securities Loaned
The Fund may participate in a securities lending program offered by BNY providing for the lending of equities, corporate bonds and government securities to qualified brokers. Collateral on all securities loaned is accepted in cash and/or government securities. Collateral is maintained at a minimum level of 102% of the market value, plus interest, if applicable, of investments on loan. Collateral received in the form of cash is invested temporarily in institutional money market funds or other short-term investments by BNY. Earnings of such temporary cash investments are divided between BNY, as a fee for its services under the program, and the Fund loaning the security, according to agreed-upon rates.
(5) Commitments and Contingencies
In the normal course of business, the Fund may enter into contracts and agreements that contain a variety of representations and warranties, which provide general indemnifications. The maximum exposure to the Fund under these arrangements is unknown, as this would involve future claims that may be against the Fund that have not yet occurred. However, based on experience, the Fund expects the risks of loss to be remote.
(6) Transactions with Affiliated Companies
An affiliated company is a company that is directly or indirectly controlled by a related party or a company in which a fund has ownership of at least 5% of the voting securities. Transactions during the six months ended June 30, 2005, with companies which are or were affiliates are as follows:
Summary of Transactions with Affiliated Companies - Special Equity
Affiliate | Purchase Cost | Sales Cost | Dividend Income | Market Value | ||||||||
AK Steel Holding Corp. | $ | 18,203,786 | $ | 28,775,398 | $ | — | $ | 31,597,454 | ||||
Anaren Microwave, Inc. | — | — | — | 13,911,385 | ||||||||
Intevac, Inc. | 2,443,507 | 1,650,653 | — | 10,971,513 | ||||||||
Meristar Hospitality Corp. | — | — | — | 43,211,560 | ||||||||
Totals | $ | 20,647,293 | $ | 30,426,051 | $ | — | $ | 99,691,912 | ||||
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Annual Renewal of Investment Advisory Agreements (unaudited)
On June 3, 2005, the Board of Trustees, including a majority of the Trustees that are not “interested persons” of the Trust (the “Independent Trustees”), approved the Investment Management Agreement with Managers Investment Group LLC (the “Investment Manager”) for the Fund and the Subadvisory Agreement for each of the Subadvisors except Veredus, which Subadvisory Agreement had been previously approved by the Board of Trustees in January 2005. The Independent Trustees were separately represented by independent counsel in connection with their consideration of the approval of these agreements. In considering the Investment Management and Subadvisory Agreements, the Trustees reviewed a variety of materials relating to the Fund, the Investment Manager and each Subadvisor, including comparative performance, fee and expense information for an appropriate peer group of similar mutual funds (the “Peer Group”), performance information for the relevant benchmark index (the “Fund Benchmark”) and other information regarding the nature, extent and quality of services provided by the Investment Manager and the Subadvisors under their respective agreements. The Trustees also took into account performance, fee and expense information regarding the Fund provided to them on a quarterly basis throughout the year. Prior to voting, the Independent Trustees (a) reviewed the foregoing information with their independent legal counsel and with management; (b) received materials from their independent legal counsel discussing the legal standards applicable to their consideration of the Investment Management Agreement and the Subadvisory Agreements; and (c) met with their independent legal counsel in private sessions at which no representatives of management were present.
Nature, extent and quality of services. In considering the nature, extent and quality of the services provided by the Investment Manager, the Trustees reviewed information relating to the Investment Manager’s operations and personnel. Among other things, the Investment Manager provided financial information, biographical information on its supervisory and professional staff and descriptions of its organizational and management structure. The Trustees also took into account information provided periodically throughout the previous year by the Investment Manager relating to the performance of its duties with respect to the Fund and the Trustees’ familiarity with the Investment Manager’s management through Board meetings, discussions and reports. In the course of their deliberations regarding the Investment Management Agreement, the Trustees evaluated, among other things: (a) the quality of the search, selection and monitoring services performed by the Investment Manager in overseeing the portfolio management responsibilities of the Subadvisors; (b) the Investment Manager’s ability to supervise the Fund’s other service providers; and (c) the Investment Manager’s compliance programs. The Trustees also took into account the financial condition of the Investment Manager with respect to its ability to provide the services required under the Investment Management Agreement.
The Trustees also reviewed information relating to each Subadvisor’s operations, personnel, and the investment philosophy, strategies and techniques (for each Subadvisor, its “Investment Strategy”) used in managing the portion of the Fund for which the Subadvisor has portfolio management responsibility. Among other things, the Trustees reviewed biographical information on portfolio management and other professional staff, information regarding each Subadvisor’s organizational and management structure and each Subadvisor’s brokerage policies and practices. The Trustees considered specific information provided regarding the experience of the individual or individuals at each Subadvisor with portfolio management responsibility for the portion of the Fund managed by the Subadvisor, including the information set forth in the Fund’s prospectus. The Trustees also noted information provided by the Investment Manager regarding the manner in which each Subadvisor’s Investment Strategy complements those utilized by the Fund’s other Subadvisors. In the course of their deliberations, the Trustees evaluated, among other things: (a) the services rendered by each Subadvisor in the past; (b) the qualifications and experience of the Subadvisor’s personnel; and (c) the Subadvisor’s compliance programs. The Trustees also took into account the financial condition of the Subadvisor with respect to its ability to provide the services required under the Subadvisory Agreement.
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was below, below, below and above, respectively, the median performance of the Peer Group and was above, below, below and above, respectively, the performance of the Fund Benchmark, which is the Russell 2000 Index. The Trustees also noted management’s discussion of the Fund’s growth bias and the market environment during relevant time periods. Furthermore, the Trustees noted that the Investment Manager had taken action to replace one of the Fund’s Subadvisors in January 2005 to improve the performance of the Fund. The Trustees also took into account the Investment Strategies of the Fund’s Subadvisors relative to the investment strategies of the Fund’s Peer Group. The Trustees concluded that the Fund’s performance was satisfactory in light of all factors considered.
Subadvisor Performance. As noted above, the Board considered the Fund’s performance during relevant time periods as compared to the Fund’s Peer Group and noted that the Board reviews on a quarterly basis detailed information about the Fund’s performance results, portfolio composition and Investment Strategies, including with respect to the portion of the Fund managed by each Subadvisor. The Board noted the Investment Manager’s expertise and resources in monitoring the performance, investment style and risk adjusted performance of each Subadvisor. The Board also noted each Subadvisor’s long-term performance record
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Annual Renewal of Investment Advisory Agreements (continued)
with respect to the Fund. The Board was mindful of the Investment Manager’s focus on each Subadvisor’s performance with respect to the Fund and the explanations of management regarding the factors that contributed to the short-term performance of the Fund.
Advisory Fees and Profitability. In considering the reasonableness of the advisory fee charged by the Investment Manager for managing the Fund, the Trustees noted that the Investment Manager, and not the Fund, is responsible for paying the fees charged by the Fund’s Subadvisors and, therefore, that the fees paid to the Investment Manager cover the reasonable cost of providing portfolio management services as well as the reasonable cost of providing search, selection and monitoring services in operating a “manager-of-managers” complex of mutual funds. The Trustees concluded that, in light of the additional high quality supervisory services provided by the Investment Manager and the fact that the subadvisory fees are paid out of the advisory fee, the advisory fee payable by the Fund to the Investment Manager can reasonably be expected to exceed the median advisory fee for the Peer Group, which consists mostly of funds that do not operate with a manager-of-managers structure. The Trustees noted that the Fund’s advisory fee and total expenses as of March 31, 2005 were higher than the average and lower than the average, respectively, for the Fund’s Peer Group. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisors, the Fund’s performance, and the considerations noted above with respect to the Subadvisors and the Investment Manager, the Fund’s advisory fees are reasonable.
In considering the reasonableness of the advisory fee payable to the Investment Manager, the Trustees reviewed information provided by the Investment Manager setting forth all revenues and other benefits, both direct and indirect, received by the Investment Manager and its affiliates attributable to managing the Fund, the cost of providing such services and the resulting profitability to the Investment Manager and its affiliates from these relationships. The Trustees also noted the current asset levels of the Fund and the impact on profitability of any future growth of assets of the Fund. In this regard, the Trustees noted that the Investment Manager has recommended the appointment of additional Subadvisors in response to material increases in the assets of the Fund, that the Fund currently has five Subadvisors, each managing a portion of the Fund’s portfolio, and that the Investment Manager’s oversight and supervisory responsibilities with respect to the Fund have increased with the size of the Fund and the number of Subadvisors. The Trustees also noted that the subadvisory fees are paid by the Investment Manager out of its advisory fee. Based on the foregoing, the Trustees concluded that the Investment Manager is not realizing material benefits from economies of scale that would warrant adjustments to the advisory fee at this time. With respect to economies of scale, the Trustees also noted that as the Fund’s assets increase over time, the Fund may realize other economies of scale to the extent that the increase in assets is proportionally greater than the increase in certain other expenses.
Subadvisory Fees and Profitability. In considering the reasonableness of the fee payable by the Investment Manager to each Sub-advisor (other than Skyline, which is an affiliate of the Investment Manager), the Trustees relied on the ability of the Investment Manager to negotiate the terms of each Subadvisory Agreement at arm’s length as part of the manager-of-managers structure, noting that the Investment Manager is not affiliated with these Subadvisors. In addition, the Trustees noted that the subadvisory fees are paid by the Investment Manager out of its advisory fee. Accordingly, the cost of services to be provided by each Subadvisor and the profitability to each Subadvisor of its relationship with the Fund were not material factors in the Trustees’ deliberations. For similar reasons, and based on the current size of the portion of the Fund managed by each Subadvisor, the Trustees concluded that the effect of any economies of scale being realized by the Subadvisors was not a material factor in the Trustees’ deliberations at this time.
In considering the reasonableness of the fee payable by the Investment Manager to Skyline, the Trustees noted that Skyline is an affiliate of the Investment Manager. The Trustees also noted that the fee payable by the Investment Manager to Skyline under its Subadvisory Agreement is identical to the fee payable to each of the other Subadvisors of the Fund, none of which is an affiliate of the Investment Manager. The Trustees also noted that the subadvisory fee is paid by the Investment Manager out of the advisory fee. Accordingly, the cost of services to be provided by Skyline and the profitability to Skyline of its relationship with the Fund were not material factors in the Trustees’ deliberations. For similar reasons, and based on the current size of the portion of the Fund managed by each Subadvisor, the Trustees concluded that the effect of any economies of scale being realized by Skyline was not a material factor in the Trustees’ deliberations at this time.
After consideration of the foregoing, the Trustees also reached the following conclusions regarding the Investment Management Agreement and the Subadvisory Agreements with each of the Subadvisors, in addition to those conclusions discussed above: (a) the Investment Manager and each Subadvisor have demonstrated that they possess the capability and resources to perform the duties required of them under the Investment Management Agreement and the applicable Subadvisory Agreements; (b) each Subadvisor’s Investment Strategy is appropriate for pursuing the Fund’s investment objectives; (c) each Subadvisor is reasonably likely to execute its Investment Strategy consistently over time; and (d) the Investment Manager and each Subadvisor maintain appropriate compliance programs.
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Annual Renewal of Investment Advisory Agreements (continued)
Based on all of the above-mentioned factors and their related conclusions, with no single factor or conclusion being determinative and with each Trustee not necessarily attributing the same weight to each factor, the Trustees concluded that approval of the Investment Management Agreement and each Subadvisory Agreement would be in the interests of the Fund and its shareholders. Accordingly, on June 3, 2005 the Trustees, including a majority of the Independent Trustees, voted to approve the Investment Management Agreement and the Subadvisory Agreement for each of the Fund Subadvisors except Veredus (whose Subadvisory Agreement was approved in January 2005).
Approval of Subadvisory Agreement with Veredus on January 13. 2005
At a meeting held on January 13, 2005, the Trustees, including all of the Independent Trustees of the Trust, voted to approve the Subadvisory Agreement with Veredus (the “Veredus Agreement”). The Independent Trustees were separately represented by independent counsel in connection with their consideration of the approval of the Veredus Agreement. In considering the Veredus Agreement for the Fund, the Trustees reviewed and considered a variety of materials relating to the Fund, the Investment Manager and Veredus, including comparative performance of similarly managed investment companies, performance information for non-mutual fund accounts managed by Veredus and the relevant benchmark indices, the nature and quality of services to be provided by Veredus under the Veredus Agreement, and information regarding the investment strategies and portfolio management team of Veredus.
In considering the nature, extent and quality of services to be provided by Veredus under the Veredus Agreement, the Trustees reviewed information provided by Veredus relating to its operations and personnel. Among other things, in considering the qualifications and experience of Veredus’ portfolio management team, the Trustees reviewed biographical information on portfolio managers and other professional staff at Veredus, as well as information regarding the organizational and management structure of the firm. In the course of their deliberations, the Trustees noted the substantial investment experience of Messrs. Weber, McCurdy and Mercer as the portfolio managers responsible for the management of the Fund’s assets, as well as Veredus’ broad research and analytical resources. The Trustees also took into account the financial condition and structure of Veredus with respect to its ability to provide the services required under the Veredus Agreement.
The Trustees also evaluated (i) Veredus’ growth-based investment philosophy, (ii) the appropriateness of Veredus’ Investment Strategy for pursuing the Fund’s investment objective, (iii) the consistency of Veredus’ adherence to the Investment Strategy in managing accounts of its other advisory clients that had hired Veredus to employ the Investment Strategy, (iv) Veredus’ brokerage policies and practices, and (v) Veredus’ compliance programs, including those related to personal investing. The Trustees considered these factors in determining that the Investment Strategy would be compatible with the investment objective of the Fund, as well as complementary with the investment strategies and techniques of the other Subadvisors to the Fund. In this context, the Trustees also reviewed information provided in May 2004 in connection with the approval of the Management Agreement and other Subadvisory Agreements relating to the Fund, including comparative information with respect to the advisory and subadvisory fees of the Fund, as well as relevant updates to that information provided in the interim.
The Trustees reviewed Veredus’ performance in employing its Investment Strategy by reviewing performance information for other investment accounts managed by Veredus in a manner consistent with the Investment Strategy. In their review of this performance, the Trustees noted that the performance (net of fees) of a composite investment portfolio managed by Veredus outperformed the Russell 2000 Growth Index for 10 of the 15 years from 1990 through 2004. The Trustees also considered this performance information in light of the recent performance of the Fund and the performance of Essex Investment Management Company, LLC (“Essex”), the Subadvisor being replaced by Veredus, in managing its portion of the Fund.
In considering the cost of services to be provided by Veredus under the Veredus Agreement and the profitability to Veredus of its relationship with the Fund, the Trustees relied on the ability of the Manager to negotiate the Veredus Agreement and the fees thereunder at arm’s length in view of the Fund’s manager-of-managers structure and the lack of affiliation or other material business relationships between the Manager and Veredus. The Trustees noted that the fee waiver of the Manager of 0.10% with respect to the portion of the Fund managed by Essex in excess of $100 million would terminate, but also noted that the fees payable to Veredus under the Veredus Agreement are identical to those paid to other Subadvisors to the Fund. For similar reasons, and based on the amount of Fund assets to be managed by Veredus, the Trustees did not consider any potential economies of scale in Veredus’ management of the Fund to be a material factor in their consideration at this time.
After consideration of the foregoing factors, the Trustees reached the following conclusions regarding the Veredus Agreement, among others: (a) Veredus is qualified to manage the portion of the Fund’s assets to be assigned to it in accordance with the Fund’s investment objective and policies; (b) Veredus maintains appropriate compliance programs; (c) Veredus’ Investment
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Annual Renewal of Investment Advisory Agreements (continued)
Strategy is appropriate for pursuing the Fund’s investment objective and is complementary to the strategies of the other Subadvisors to the Fund; (d) Veredus is reasonably likely to execute its Investment Strategy consistently over time; and (e) the Fund’s advisory fees are reasonable in relation to those of similar funds and to the services to be provided by Veredus.
Based on the foregoing, the Trustees, including all of the Independent Trustees, concluded that the approval of the Veredus Agreement is in the interests of the Fund and its shareholders.
19
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Administrator
Managers Investment Group LLC
800 Connecticut Avenue
Norwalk, Connecticut 06854
(203) 299-3500 or (800) 835-3879
Distributor
Managers Distributors, Inc.
800 Connecticut Avenue
Norwalk, Connecticut 06854
(203) 299-3500 or (800) 835-3879
Custodian
The Bank of New York
2 Hanson Place
Brooklyn, New York 11217
Legal Counsel
Goodwin Procter LLP
Exchange Place
Boston, Massachusetts 02109-2881
Transfer Agent
PFPC, Inc.
Attn: Managers
P.O. Box 9769
Providence, Rhode Island 02940
(800) 548-4539
For ManagersChoice Only
Managers Funds
PFPC, Inc. c/o Wrap Services
P.O. Box 9847
Providence, Rhode Island 02940
(800) 358-7668
Trustees
Jack W. Aber
William E. Chapman, II
Edward J. Kaier
Peter M. Lebovitz
William J. Nutt
Steven J. Paggioli
Eric Rakowski
Thomas R. Schneeweis
Table of Contents
MANAGERSAND MANAGERS AMG EQUITY FUNDS
CAPITAL APPRECIATION
Bramwell Capital Management, Inc.
Essex Investment Management Co., LLC
EMERGING MARKETS EQUITY
Rexiter Capital Management Limited
ESSEX AGGRESSIVE GROWTH
ESSEX LARGE CAP GROWTH
ESSEX SMALL/MICRO CAP GROWTH
Essex Investment Management Co., LLC
FIRST QUADRANT TAX-MANAGED EQUITY
First Quadrant, L.P.
INSTITUTIONAL MICRO-CAP
Kern Capital Management LLC
INTERNATIONAL EQUITY
Bernstein Investment Research and Management
Lazard Asset Management, LLC
Wellington Management Company LLP
INTERNATIONAL GROWTH
Wellington Management Company LLP
MICRO-CAP
Kern Capital Management LLC
MID-CAP
Chicago Equity Partners, LLC
REAL ESTATE SECURITIES
Urdang Securities Management, Inc.
RENAISSANCE LARGE-CAP EQUITY
Renaissance Investment Management
RORER MID-CAP
RORER LARGE-CAP
Rorer Asset Management, LLC
SMALL CAP
TimesSquare Capital Management, LLC
SMALL COMPANY
Kalmar Investment Advisers, Inc.
SPECIAL EQUITY
Donald Smith & Co., Inc.
Kern Capital Management LLC
Skyline Asset Management, L.P.
Veredus Asset Management LLC
Westport Asset Management, Inc.
STRUCTURED CORE
First Quadrant, L.P.
SYSTEMATIC VALUE
Systematic Financial Management, L.P.
TIMESSQUARE MID CAP GROWTH
TIMESSQUARE SMALL CAP GROWTH
TimesSquare Capital Management, LLC
VALUE
Armstrong Shaw Associates Inc.
Osprey Partners Investment Mgmt., LLC
20
Oak Associates, Ltd.
MANAGERS BALANCED FUNDS
BALANCED
Chicago Equity Partners, LLC
Loomis, Sayles & Company L.P.
GLOBAL
333 Global Advisers*
Armstrong Shaw Associates Inc.
Bernstein Investment Research and Management
First Quadrant, L.P.
Kern Capital Management LLC
Northstar Capital Management, Inc.
Wellington Management Company LLP
MANAGERS FIXED INCOME FUNDS
BOND (MANAGERS)
Loomis, Sayles & Company L.P.
BOND (MANAGERS FREMONT)
Pacific Investment Management Co. LLC
CALIFORNIA INTERMEDIATE TAX-FREE
Evergreen Investment Management Co., LLC
FIXED INCOME
Loomis, Sayles & Company L.P.
GLOBAL BOND
Loomis, Sayles & Company L.P.
HIGH YIELD
J.P. Morgan Investment Management Inc.
INTERMEDIATE DURATION GOVERNMENT
Smith Breeden Associates, Inc.
MONEY MARKET (MANAGERS)
JPMorgan Investment Advisors Inc.
MONEY MARKET (FREMONT)
333 Global Advisers*
SHORT DURATION GOVERNMENT
Smith Breeden Associates, Inc.
* | A division of Managers Investment Group LLC |
This report is prepared for the Fund’s shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by an effective prospectus. To receive a free copy of the prospectus or Statement of Additional Information, which includes additional information about Fund Trustees, please contact us by calling 800.835.3879. Distributed by Managers Distributors, Inc., member NASD.
A description of the policies and procedures each Fund uses to vote its proxies is available: (i) without charge, upon request, by calling 800.835.3879, or (ii) on the Securities and Exchange Commission’s (SEC) Web site at www.sec.gov. For information regarding each Fund’s proxy voting record for the 12-month period ended June 30, call 800.835.3879 or visit the SEC Web site at www.sec.gov.
The Funds file their complete schedule of portfolio holdings with the 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 website at www.sec.gov. A Funds’ Forms N-Q 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 800.SEC.0330. For a complete list of the Funds’ portfolio holdings, view the most recent monthly holdings report, semi-annual report, or annual report at www.managersinvest.com.
SAR002-0506
www.managersinvest.com | ![]() |
Table of Contents
Managers Funds
June 30, 2005
• | Managers Value Fund |
• | Managers Capital Appreciation Fund |
• | Managers Small Company Fund |
• | Managers International Equity Fund |
• | Managers Emerging Markets Fund |
• | Managers Bond Fund |
• | Managers Global Bond Fund |
Table of Contents
1 | ||
2 | ||
3 | ||
4 | ||
Equity Funds’ top ten holdings, industry weightings and country breakdown at June 30, 2005 | ||
8 | ||
9 | ||
11 | ||
13 | ||
16 | ||
18 | ||
22 | ||
25 | ||
Financial Statements | ||
26 | ||
Funds’ balance sheet, net asset value (NAV) per share computation and cumulative undistributed amount | ||
28 | ||
Detail of sources of income, Fund expenses, and realized and unrealized gains (losses) during the fiscal period | ||
30 | ||
Detail of changes in Fund assets for the past two fiscal periods | ||
33 | ||
Historical net asset values per share, distributions, total returns, expense ratios, turnover ratios and net assets for each Fund | ||
37 | ||
Accounting and distribution policies, details of agreements and transactions with Fund management and description of certain investment risks | ||
Annual Renewal of Investment Advisory Agreements | 42 |
Nothing contained herein is to be considered an offer, sale, or solicitation of an offer to buy shares of The Managers Funds. Such offering is made only by Prospectus, which includes details as to offering price and other material information.
Table of Contents
Dear Fellow Shareholder:
Over the past six months the Managers Funds family has taken a number of steps forward. Since we joined with two of our Affiliates early this year to form Managers Investment Group LLC, we have expanded the fund family, received a nationally recognized award, and added Web site improvements that we hope make it much easier for you to get information about your investments in our Funds.
We added the Managers AMG TimesSquare Mid Cap Growth Fund on March 4 and the Managers AMG TimesSquare Small Cap Growth Fund on April 11, both subadvised by TimesSquare Capital Management. TimesSquare is widely respected by financial advisors and retirement plan consultants, and we are pleased to add these two funds to our fund family.
I am also pleased to report that in March, Managers Funds was named Best Fixed Income Group in the smaller fund family category by Lipper, the mutual fund research and analysis company. The Lipper Fund Awards 2005 recognize fund families that deliver consistently strong relative performance for their funds’ shareholders. In the fixed income asset class, Managers Funds competed with 78 other eligible smaller fund groups to win the award.
The Managers Funds cited by the Lipper Fund Award are: Managers Bond (Long-Term Bond), Managers Fixed Income (Intermediate-Term Bond), Managers Global Bond (World Bond), Managers High Yield (High Yield Bond), Managers Intermediate Duration Government (Short-Term Government Bond) and Managers Short Duration Government (Ultra-short Bond).
Finally, if you have not visited our Web site recently, I urge you to do so. We have noticed an increase in traffic to the site, no doubt driven by the clean and clear look as well as the simplified access to fund information now available at www.managersinvest.com. If you invest with us directly, or through our ManagersChoice® program, I recommend that you sign up for account access so that you can have your account information readily available at any time. On our home page you will see a link to Access Your Account, which has information about how you can get started.
Please do visit our Web site if you have questions about your Funds, or call us toll free at 1-800-835-3879. Thank you for your continuing confidence in Managers Funds.
Respectfully,
Peter M. Lebovitz
President
The Managers Funds
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As a shareholder of a Fund, you may incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments; redemption fees; and exchange fees; and (2) ongoing costs, including management fees; distribution (12b-l) fees; and other Fund expenses. These Funds incur only ongoing costs. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.
Actual Expenses
The first line of the table below provides information about the actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. 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 in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. 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 the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of 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), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Six Months Ended June 30, 2005 | Beginning Account 12/31/2004 | Ending Account 6/30/2005 | Expenses Paid Period* | ||||||
Managers Value Fund | |||||||||
Actual | $ | 1,000 | $ | 1,023 | $ | 5.92 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019 | $ | 5.91 | |||
Managers Capital Appreciation Fund | |||||||||
Actual | $ | 1,000 | $ | 969 | $ | 6.25 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,018 | $ | 6.40 | |||
Managers Small Company Fund | |||||||||
Actual | $ | 1,000 | $ | 988 | $ | 7.15 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,018 | $ | 7.25 | |||
Managers International Equity Fund | |||||||||
Actual | $ | 1,000 | $ | 972 | $ | 7.33 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,017 | $ | 7.50 | |||
Managers Emerging Markets | |||||||||
Actual | $ | 1,000 | $ | 1,042 | $ | 9.26 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,016 | $ | 9.15 | |||
Managers Bond Fund | |||||||||
Actual | $ | 1,000 | $ | 1,013 | $ | 4.94 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,020 | $ | 4.96 | |||
Managers Global Bond Fund | |||||||||
Actual | $ | 1,000 | $ | 967 | $ | 5.80 | |||
Hypothetical (5% return before expenses) | $ | 1,000 | $ | 1,019 | $ | 5.96 |
* | Expenses are equal to the Fund’s annualized expense ratio multiplied by the average account value over the period, multiplied by 181 (the number of days in the most recent fiscal half-year), then divided by 365. |
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The Managers Funds Performance
All periods ended June 30, 2005 (unaudited)
Six Months | 1 Year | Average Annual Total Returns | Inception Date | |||||||||||||||||
3 Years | 5 Years | 10 Years | Since Inception | |||||||||||||||||
The Managers Funds: | ||||||||||||||||||||
Equity Funds: | ||||||||||||||||||||
Value | 2.32 | % | 11.22 | % | 8.27 | % | 5.07 | % | 9.85 | % | 11.74 | % | Oct. ’84 | |||||||
Capital Appreciation | (3.14 | )% | 1.41 | % | 2.94 | % | (13.96 | )% | 8.02 | % | 11.68 | % | Jun. ’84 | |||||||
Small Company | (1.16 | )% | 5.03 | % | 11.99 | % | 0.52 | % | — | 0.47 | % | Jun. ‘00 | ||||||||
International Equity | (2.85 | )% | 10.28 | % | 7.73 | % | (2.02 | )% | 5.36 | % | 9.65 | % | Dec. ’85 | |||||||
Emerging Markets Equity | 4.18 | % | 32.83 | % | 22.95 | % | 8.20 | % | — | 9.86 | % | Feb. ’98 | ||||||||
Income Funds: | ||||||||||||||||||||
Bond | 1.28 | % | 7.21 | % | 7.83 | % | 8.39 | % | 7.83 | % | 9.78 | % | Jun. ’84 | |||||||
Global Bond | (3.26 | )% | 7.39 | % | 12.07 | % | 8.15 | % | 5.04 | % | 5.81 | % | Mar. ’94 |
The performance data shown represents past performance, which is not a guarantee of future results. Current performance may be higher or lower than the performance data quoted. The investment return and principal value of an investment in the Funds will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. For performance information through the most recent month end please call (800) 835-3879 or visit our web site at www.managersinvest.com.
The listed returns on the Fund are net of expenses. All returns are in U.S. dollars($). Returns for periods greater than one year are annualized. From time to time the Fund’s advisor has waived fees or reimbursed expenses, which may have resulted in higher returns.
In choosing a Fund, investors should carefully consider the amount they plan to invest, their investment objectives, the Fund’s investment objectives, risks, charges and expenses before investing. For this and other information, please call (800) 835-3879 or visit our website at www.managersinvest.com for a free prospectus. Read it carefully before investing or sending money. Distributed by Managers Distributors, Inc., member NASD.
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As a Percentage of Net Assets at June 30, 2005
Managers Value Fund
Top Ten Holdings (out of 69 securities) | % Fund | ||
MBNA Corp. | 2.4 | % | |
Fannie Mae Co.* | 2.2 | ||
Citigroup, Inc.* | 2.2 | ||
Cendant Corp.* | 2.1 | ||
ConocoPhillips Co. | 2.1 | ||
MBIA, Inc. | 2.1 | ||
Comcast Corp., Special Class A* | 2.1 | ||
Pfizer, Inc.* | 2.1 | ||
Hewlett-Packard Co. | 2.0 | ||
Time Warner Co., Inc. | 2.0 | ||
Top Ten as a Group | 21.3 | % | |
* | Top Ten Holding at December 31, 2004 |
Portfolio Breakdown | % Fund | ||
Financials | 30.2 | % | |
Consumer Discretionary | 22.8 | ||
Industrials | 10.9 | ||
Health Care | 10.6 | ||
Energy | 8.9 | ||
Information Technology | 5.5 | ||
Telecommunication Services | 3.4 | ||
Consumer Staples | 2.2 | ||
Utilities | 1.5 | ||
Materials | 1.3 | ||
Cash and other equivalents | 2.7 | ||
100 | % | ||
Managers Capital Appreciation Fund
Top Ten Holdings (out of 115 securities) | % Fund | ||
General Electric Co. | 3.4 | % | |
Shlumberger, Ltd.* | 2.1 | ||
Genentech, Inc. | 1.7 | ||
Caremark Rx, Inc. | 1.6 | ||
J.C. Penney Co., Inc., Holding Co. | 1.6 | ||
3M Co.* | 1.5 | ||
Intel Corp. | 1.4 | ||
Microsoft Corp.* | 1.4 | ||
Cisco Systems, Inc.* | 1.3 | ||
Walt Disney Co., The | 1.3 | ||
Top Ten as a Group | 17.3 | % | |
* | Top Ten Holding at December 31, 2004 |
Portfolio Breakdown | % Fund | ||
Consumer Discretionary | 18.4 | % | |
Health Care | 17.9 | ||
Information Technology | 17.5 | ||
Industrials | 15.2 | ||
Energy | 9.3 | ||
Financials | 8.3 | ||
Consumer Staples | 7.1 | ||
Materials | 2.6 | ||
Cash and other equivalents | 3.7 | ||
100 | % | ||
Managers Small Company Fund
Top Ten Holdings (out of 88 securities) | % Fund | ||
Ultra Petroleum Corp.* | 2.4 | % | |
Covance, Inc.* | 2.1 | ||
Insight Enterprises, Inc.* | 2.1 | ||
Respironics, Inc. | 2.0 | ||
Red Robin Gourmet Burgers, Inc. | 1.9 | ||
United Surgical Partners International, Inc. | 1.8 | ||
GameStop Corp. | 1.7 | ||
Laureate Education, Inc.* | 1.7 | ||
Acxiom Corp.* | 1.7 | ||
Coldwater Creek, Inc. | 1.6 | ||
Top Ten as a Group | 19.0 | % | |
* | Top Ten Holding at December 31, 2004 |
Portfolio Breakdown | % Fund | ||
Information Technology | 21.9 | % | |
Consumer Discretionary | 20.0 | ||
Industrials | 20.0 | ||
Health Care | 14.0 | ||
Energy | 7.7 | ||
Consumer Staples | 1.9 | ||
Materials | 1.2 | ||
Financials | 0.4 | ||
Cash and other equivalents | 12.9 | ||
100 | % | ||
4
Table of Contents
Fund Snapshots (continued)
As a Percentage of Net Assets at June 30, 2005
Managers International Equity Fund
Top Ten Holdings (out of 203 securities) | % Fund | ||
ING Groep NV | 1.2 | % | |
Au Optronics Corp., Sponsored ADR | 1.2 | ||
EnCana Corp. | 1.1 | ||
Koninklijke Ahold N.V. | 1.1 | ||
Total SA* | 1.1 | ||
BP PLC* | 1.0 | ||
Roche Holding AG | 1.0 | ||
Sumitomo Mitsui Financial Group, Inc. | 1.0 | ||
Renault SA | 1.0 | ||
Petro-Canada | 1.0 | ||
Top Ten as a Group | 10.7 | % | |
* | Top Ten Holding at December 31, 2004 |
Portfolio Breakdown | % Fund | ||
Financials | 27.4 | % | |
Consumer Discretionary | 12.3 | ||
Information Technology | 11.2 | ||
Energy | 9.9 | ||
Materials | 9.7 | ||
Consumer Staples | 8.1 | ||
Industrials | 7.9 | ||
Health Care | 5.6 | ||
Telecommunication Services | 3.3 | ||
Utilities | 3.0 | ||
Cash and other equivalents | 1.6 | ||
100 | % | ||
Managers Emerging Markets Equity Fund
Top Ten Holdings (out of 74 securities) | % Fund | ||
Turkiye Is Bankasi (Isbank)* | 2.2 | % | |
Petroleo Brasileiro S.A., Sponsored ADR* | 2.2 | ||
Samsung Electronics, Ltd., GDR representing 1/2 voting shares * | 2.1 | ||
Terkcell Iletisim Hizmetleri A.S.* | 2.0 | ||
Grupo Financiero Banorte S.A. de C.V.* | 2.0 | ||
Companhia Energetica de Minas Gerais | 1.9 | ||
Sanlam, Ltd.* | 1.9 | ||
Kookmin Bank, Sponsored ADR | 1.9 | ||
Richter Gedeon Rt | 1.9 | ||
Alfa, S.A. | 1.7 | ||
Top Ten as a Group | 19.8 | % | |
* | Top Ten Holding at December 31, 2004 |
Portfolio Breakdown | % Fund | ||
Financials | 20.3 | % | |
Telecommunication Services | 14.7 | ||
Industrials | 13.8 | ||
Information Technology | 12.0 | ||
Materials | 9.5 | ||
Energy | 7.9 | ||
Consumer Discretionary | 6.5 | ||
Consumer Staples | 4.0 | ||
Utilities | 2.5 | ||
Health Care | 2.2 | ||
Cash and other equivalents | 6.6 | ||
100 | % | ||
5
Table of Contents
Fund Snapshots (continued)
Summary of Investments by Country
Country | Managers International Equity Fund* | MSCI EAFE Index | ||||
Japan | 15.3 | % | 21.8 | % | ||
United Kingdom | 17.2 | 25.0 | ||||
France | 11.1 | 9.7 | ||||
Germany | 7.5 | 6.8 | ||||
Canada | 8.2 | 0.0 | ||||
Hong Kong | 4.9 | 1.8 | ||||
South Korea | 3.6 | 0.0 | ||||
Netherlands | 5.4 | 4.9 | ||||
Switzerland | 5.5 | 6.7 | ||||
Italy | 1.8 | 4.0 | ||||
Sweden | 2.0 | 2.4 | ||||
Spain | 2.0 | 3.9 | ||||
Ireland | 0.8 | 0.8 | ||||
Luxembourg | 0.9 | 0.0 | ||||
Singapore | 1.9 | 0.9 | ||||
Taiwan | 3.8 | 0.0 | ||||
South Africa | 1.0 | 0.0 | ||||
Brazil | 1.1 | 0.0 | ||||
Belgium | 0.7 | 1.3 | ||||
United States | 1.1 | 0.0 | ||||
Greece | 0.2 | 0.6 | ||||
Mexico | 0.8 | 0.0 | ||||
Australia | 1.2 | 5.5 | ||||
India | 0.3 | 0.0 | ||||
Russia | 0.1 | 0.0 | ||||
Norway | 0.0 | 0.7 | ||||
Hungary | 0.3 | 0.0 | ||||
Peru | 0.2 | 0.0 | ||||
Finland | 0.9 | 1.5 | ||||
Indonesia | 0.0 | 0.0 | ||||
China | 0.2 | 0.0 | ||||
Portugal | 0.0 | 0.3 | ||||
Denmark | 0.0 | 0.8 | ||||
Turkey | 0.0 | 0.0 | ||||
Venezuela | 0.0 | 0.0 | ||||
Austria | 0.0 | 0.4 | ||||
New Zealand | 0.0 | 0.2 |
Summary of Investments by Country
Country | Managers Emerging Markets Equity Fund* | MSCI EMF Index | ||||
South Korea | 13.0 | % | 16.6 | % | ||
Taiwan | 9.8 | 17.7 | ||||
Brazil | 11.5 | 9.5 | ||||
India | 8.9 | 5.9 | ||||
Malaysia | 8.7 | 3.6 | ||||
South Africa | 4.6 | 10.0 | ||||
Mexico | 5.2 | 6.0 | ||||
Russia | 7.1 | 4.3 | ||||
Turkey | 5.4 | 1.9 | ||||
Thailand | 3.2 | 2.1 | ||||
Indonesia | 2.5 | 1.7 | ||||
China | 2.7 | 7.6 | ||||
Hong Kong | 2.8 | 0.0 | ||||
Israel | 1.3 | 2.7 | ||||
Poland | 0.0 | 1.7 | ||||
United Kingdom | 1.5 | 0.0 | ||||
Hungary | 1.9 | 1.5 | ||||
Czech Republic | 1.6 | 0.8 | ||||
Venezuela | 1.1 | 0.1 | ||||
United States | 3.4 | 0.0 | ||||
Argentina | 1.5 | 0.0 | ||||
Chile | 1.5 | 1.9 | ||||
Supranational & Other | 0.0 | 1.6 | ||||
Colombia | 0.4 | 0.2 | ||||
Egypt | 0.0 | 0.8 | ||||
Jordan | 0.0 | 0.3 | ||||
Morocco | 0.0 | 0.2 | ||||
Pakistan | 0.0 | 0.3 | ||||
Peru | 0.0 | 0.5 | ||||
Philippines | 0.4 | 0.5 | ||||
Australia | 0.0 | 0.0 | ||||
Austria | 0.0 | 0.0 | ||||
Belgium | 0.0 | 0.0 | ||||
Spain | 0.0 | 0.0 | ||||
Sweden | 0.0 | 0.0 | ||||
Switzerland | 0.0 | 0.0 | ||||
Canada | 0.0 | 0.0 |
* | As a percent of total market value of common stocks on June 30, 2005. |
6
Table of Contents
Fund Snapshots (continued)
As a Percentage of Net Assets at June 30, 2005
Managers Bond Fund
Top Ten Holdings (out of 131 securities) | % Fund | ||
USTN, 2.750%, 06/30/06 | 11.6 | % | |
USTN, 3.000%, 02/15/08 | 5.8 | ||
USTN, 2.750%, 07/31/06 | 4.3 | ||
USTN, 1.625%, 02/28/06 | 3.5 | ||
USTN, 1.875%, 12/31/05 | 3.2 | ||
USTN, 2.500%, 09/30/06 | 2.9 | ||
USTN, 1.625%, 10/31/05 | 2.0 | ||
FNMA, 2.375, 02/15/07 | 2.0 | ||
Mexican Government, 9.000%, 12/20/12 | 1.9 | ||
FNMA, Pool 734652, 4.000%, 10/01/18 | 1.8 | ||
Top Ten as a Group | 39.0 | % | |
Portfolio Breakdown | % Fund | ||
U.S. Treasury Notes | 37.0 | % | |
Industrials | 18.7 | ||
U.S. Government Agency Obligations | 12.6 | ||
Finance | 9.7 | ||
Foreign Government | 3.7 | ||
Utilities | 3.3 | ||
Asset-Backed Securities | 1.9 | ||
Preferred Stock | 0.9 | ||
Cash and other equivalents | 12.2 | ||
100 | % | ||
Managers Global Bond Fund
Top Ten Holdings (out of 124 securities) | % Fund | ||
KfW International Finance Inc., 2.050%, 09/21/09 | 3.7 | % | |
FNMA, 1.750%, 03/26/08 | 3.4 | ||
Spanish Government, 3.600%, 01/31/09 | 3.1 | ||
Bundes Obligation, Series 139, 4.000%, 02/16/07 | 2.9 | ||
Singapore Government, 4.625%, 07/01/10 | 2.8 | ||
Republic of Italy, 0.375%, 10/10/06 | 2.8 | ||
Hypothekenbank in Essen AG, 5.250%, 01/22/08 | 2.7 | ||
Republic of Poland, 1.020%, 06/09/09 | 2.4 | ||
U.K. Treasury, 5.000%, 03/07/12 | 2.3 | ||
Netherlands Government SA, 5.500%, 01/15/28 | 2.2 | ||
Top Ten as a Group | 28.3 | % | |
Portfolio Breakdown | % Fund | ||
Foreign Government | 44.6 | % | |
Finance | 18.5 | ||
Industrials | 14.7 | ||
U.S. Government Agency Obligations | 6.1 | ||
U.S. Treasury Notes | 5.7 | ||
Utilities | 2.5 | ||
Asset-Backed Securities | 1.7 | ||
Other MBS | 0.9 | ||
Cash and other equivalents | 5.3 | ||
100 | % | ||
7
Table of Contents
June 30, 2005
Schedule of Portfolio Investments (unaudited) | Value |
Security Description | Shares | Value | |||||
Common Stocks - 97.3% | |||||||
Consumer Discretionary - 22.8% | |||||||
Claire’s Stores, Inc. | 52,400 | $ | 1,260,220 | ||||
Clear Channel Communications, Inc. | 36,600 | 2 | 1,132,038 | ||||
Comcast Corp., Special Class A* | 81,000 | 2,425,950 | |||||
Dollar Tree Stores, Inc.* | 86,800 | 2 | 2,083,200 | ||||
Gannett Co., Inc. | 14,750 | 1,049,168 | |||||
Gap, Inc., The | 84,000 | 2 | 1,659,000 | ||||
Hughes Supply, Inc. | 41,400 | 2 | 1,163,340 | ||||
Jones Apparel Group, Inc. | 47,500 | 2 | 1,474,400 | ||||
Lear Corp. | 61,900 | 2 | 2,251,922 | ||||
Liberty Media Corp.* | 136,700 | 1,392,973 | |||||
Mattel, Inc. | 78,000 | 1,427,400 | |||||
Office Depot, Inc.* | 86,000 | 1,964,240 | |||||
Pulte Homes, Inc. | 19,650 | 2 | 1,655,513 | ||||
Rent-A-Center, Inc.* | 60,000 | 1,397,400 | |||||
Ruby Tuesday, Inc. | 45,200 | 2 | 1,170,680 | ||||
Time Warner Co., Inc.* | 138,400 | 2,312,663 | |||||
Yum! Brands, Inc. | 16,880 | 2 | 879,110 | ||||
Total Consumer Discretionary | 26,699,217 | ||||||
Consumer Staples - 2.2% | |||||||
CVS Corp. | 63,400 | 1,843,038 | |||||
Unilever NV | 10,500 | 680,715 | |||||
Total Consumer Staples | 2,523,753 | ||||||
Energy - 8.9% | |||||||
BP, PLC. Sponsored ADR | 10,100 | 630,038 | |||||
ChevronTexaco Corp. | 73,400 | 4,104,528 | |||||
ConocoPhillips Co. | 43,196 | 2,483,338 | |||||
Devon Energy Corp. | 37,800 | 1,915,704 | |||||
Transocean, Inc.* | 23,900 | 1,289,883 | |||||
Total Energy | 10,423,491 | ||||||
Financials - 30.2% | |||||||
ACE, Ltd. | 33,050 | 1,482,293 | |||||
Allstate Corp., The | 29,800 | 1,780,550 | |||||
American International Group, Inc. | 65,200 | 3,788,120 | |||||
Bank of America Corp. | 37,350 | 1,703,534 | |||||
Chubb Corp. | 17,230 | 2 | 1,475,060 | ||||
Citigroup, Inc. | 97,241 | 4,495,451 | |||||
Fannie Mae Co. | 70,370 | 2 | 4,109,608 | ||||
Goldman Sachs Group, Inc. | 20,800 | 2,122,016 | |||||
Hartford Financial Services Group, Inc. | 20,300 | 1,518,034 | |||||
MBIA, Inc. | 41,000 | 2 | 2,431,710 | ||||
MBNA Corp. | 107,600 | 2,814,816 | |||||
Merrill Lynch & Co., Inc. | 47,600 | 2,618,476 | |||||
Morgan Stanley Co. | 28,720 | 1,506,938 | |||||
Regions Financial Corp. | 25,726 | 2 | 871,597 | ||||
St. Paul Travelers Companies, Inc., The | 31,930 | 2 | 1,262,193 | ||||
Washington Mutual, Inc. | 33,800 | 1,375,322 | |||||
Total Financials | 35,355,718 | ||||||
Health Care - 10.6% | |||||||
Abbott Laboratories Co. | 34,800 | 1,705,548 | |||||
Cardinal Health, Inc. | 24,600 | 2 | 1,416,468 | ||||
GlaxoSmithKline PLC, Sponsored ADR | 42,000 | 2 | 2,037,420 | ||||
HCA, Inc. | 26,280 | 2 | 1,489,288 | ||||
Health Management Associates, Inc. | 34,500 | 2 | 903,210 | ||||
Pfizer, Inc. | 118,200 | 3,259,956 | |||||
WellPoint, Inc.* | 22,200 | 1,546,008 | |||||
Total Health Care | 12,357,898 | ||||||
Industrials - 10.9% | |||||||
Career Education Corp.* | 36,200 | 2 | 1,325,282 | ||||
Cendant Corp. | 111,470 | 2,493,584 | |||||
Emerson Electric Co. | 25,700 | 1,609,591 | |||||
General Dynamics Corp. | 11,700 | 1,281,618 | |||||
General Electric Co. | 47,775 | 1,655,404 | |||||
Honeywell International, Inc. | 32,400 | 2 | 1,186,812 | ||||
Pitney Bowes, Inc. | 38,100 | 1,659,255 | |||||
United Technologies Corp. | 29,200 | 1,499,420 | |||||
Total Industrials | 12,710,966 | ||||||
Information Technology - 5.5% | |||||||
First Data Corp. | 28,690 | 1,151,616 | |||||
Hewlett-Packard Co. | 100,111 | 2,353,610 | |||||
Nokia Corp., Sponsored ADR | 103,300 | 1,718,912 | |||||
Xerox Corp.* | 84,400 | 2 | 1,163,876 | ||||
Total Information Technology | 6,388,014 | ||||||
Materials - 1.3% | |||||||
E.I. du Pont de Nemours & Co., Inc. | 35,500 | 2 | 1,526,855 | ||||
Telecommunication Services - 3.4% | |||||||
Nextel Communications, Inc.* | 61,000 | 1,970,910 | |||||
Verizon Communications, Inc. | 57,745 | 2 | 1,995,090 | ||||
Total Telecommunication Services | 3,966,000 | ||||||
Utilities - 1.5% | |||||||
Exelon Corp. | 34,900 | 1,791,417 | |||||
Total Common Stocks | 113,743,329 | ||||||
Other Investment Companies - 30.0%1 | |||||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 31,819,569 | 31,819,569 | |||||
JPMorgan Prime Money Market Fund, Institutional Class Shares, 3.04% | 3,248,316 | 3,248,316 | |||||
Total Short-Term Investments | 35,067,885 | ||||||
Total Investments - 127.3% | 148,811,214 | ||||||
Other Assets, less Liabilities - (127.3)% | (31,924,178 | ) | |||||
Net Assets - 100.0% | $ | 116,887,036 |
The accompanying notes are an integral part of these financial statements.
8
Table of Contents
Managers Capital Appreciation Fund
June 30, 2005
Schedule of Portfolio Investments (unaudited) | Capital Appreciation |
Security Description | Shares | Value | ||||
Common Stocks - 96.3% | ||||||
Consumer Discretionary - 18.4% | ||||||
Bed Bath & Beyond, Inc.* | 26,500 | $ | 1,107,170 | |||
Brunswick Corp. | 37,800 | 2 | 1,637,496 | |||
Carnival Corp. | 32,600 | 2 | 1,778,330 | |||
Cheesecake Factory, Inc., The * | 20,000 | 2 | 694,600 | |||
Coach, Inc.* | 5,000 | 167,850 | ||||
D.R. Horton, Inc. | 24,933 | 937,730 | ||||
Getty Images, Inc.* | 6,300 | 2 | 467,838 | |||
Harrah’s Entertainment, Inc. | 9,800 | 706,286 | ||||
Home Depot, Inc. | 20,000 | 778,000 | ||||
J.C. Penney Co., Inc., Holding Co. | 30,000 | 2 | 1,577,400 | |||
Kohl’s Corp. | 5,000 | 279,550 | ||||
Lowe’s Co., Inc. | 22,000 | 2 | 1,280,840 | |||
News Corp., Inc., Class A | 65,100 | 1,053,318 | ||||
Nike, Inc., Class B | 10,500 | 2 | 909,300 | |||
Royal Caribbean Cruises, Ltd. | 12,000 | 2 | 580,320 | |||
Staples, Inc. | 69,350 | 1,478,542 | ||||
Target Corp. | 5,000 | 272,050 | ||||
Viacom, Inc., Class B | 20,300 | 650,006 | ||||
Walt Disney Co., The | 51,900 | 1,306,842 | ||||
Yum! Brands, Inc. | 10,000 | 2 | 520,800 | |||
Total Consumer Discretionary | 18,184,268 | |||||
Consumer Staples - 7.1% | ||||||
Brown-Forman Corp. | 8,000 | 483,680 | ||||
Bunge, Ltd. | 9,000 | 2 | 570,600 | |||
Hershey Foods Corp. | 10,000 | 621,000 | ||||
Kellogg Co. | 12,000 | 2 | 533,280 | |||
PepsiCo, Inc. | 11,000 | 593,230 | ||||
Procter & Gamble Co. | 42,000 | 2 | 2,215,500 | |||
Walgreen Co. | 25,000 | 2 | 1,149,750 | |||
Wal-Mart Stores, Inc. | 19,000 | 915,800 | ||||
Total Consumer Staples | 7,082,840 | |||||
Energy - 9.3% | ||||||
ConocoPhillips Co. | 12,000 | 689,880 | ||||
Devon Energy Corp. | 10,000 | 506,800 | ||||
ENSCO International, Inc. | 21,700 | 2 | 775,775 | |||
EOG Resources, Inc. | 10,000 | 2 | 568,000 | |||
ExxonMobil Corp. | 12,000 | 689,640 | ||||
Halliburton Co. | 24,800 | 1,185,936 | ||||
Newfield Exploration Co.* | 14,000 | 558,460 | ||||
Noble Corp.* | 10,000 | 2 | 615,100 | |||
Patterson-UTI Energy, Inc. | 10,000 | 2 | 278,300 | |||
Schlumberger, Ltd. | 37,200 | 2 | 2,824,968 | |||
Weatherford International, Ltd.* | 10,000 | 2 | 579,800 | |||
Total Energy | 9,272,659 | |||||
Financials - 8.3% | ||||||
American International Group, Inc. | 21,300 | 1,237,530 | ||||
Bear Stearns Co., Inc., The | 7,500 | 2 | 779,550 | |||
Blackrock, Inc. | 9,300 | 748,185 | ||||
Chicago Mercantile Exchange Holdings, Inc. | 3,000 | 2 | 886,500 | |||
Citigroup, Inc. | 21,500 | 993,945 | ||||
Goldman Sachs Group, Inc. | 10,200 | 2 | 1,040,604 | |||
Investors Financial Services Corp. | 14,700 | 2 | 555,954 | |||
Merrill Lynch & Co., Inc. | 11,900 | 654,619 | ||||
Wells Fargo & Co. | 21,400 | 1,317,812 | ||||
Total Financials | 8,214,699 | |||||
Health Care - 17.9% | ||||||
Amgen, Inc.* | 10,000 | 604,600 | ||||
Beckman Coulter, Inc. | 7,500 | 476,775 | ||||
Caremark Rx, Inc.* | 36,200 | 1,611,624 | ||||
Fisher Scientific International, Inc.* | 10,600 | 2 | 687,940 | |||
Genentech, Inc.* | 20,600 | 2 | 1,653,768 | |||
Gilead Sciences, Inc.* | 38,100 | 1,676,019 | ||||
Kyphon, Inc.* | 25,000 | 2 | 869,750 | |||
McKesson Corp. | 24,200 | 2 | 1,083,918 | |||
Medtronic, Inc. | 20,000 | 1,035,800 | ||||
Novartis AG, Sponsored ADR | 37,900 | 1,797,976 | ||||
Roche Holdings, Ltd., Sponsored ADR* | 8,000 | 506,440 | ||||
Stryker Corp. | 26,000 | 1,236,560 | ||||
Teva Pharmaceutical Industries, Ltd., Sponsored ADR | 38,200 | 1,189,548 | ||||
UnitedHealth Group, Inc. | 20,000 | 1,042,800 | ||||
Zimmer Holdings, Inc.* | 29,700 | 2 | 2,262,249 | |||
Total Health Care | 17,735,767 | |||||
Industrials - 15.2% | ||||||
3M Co. | 20,000 | 1,446,000 | ||||
Canadian Pacific Railway Ltd. | 24,000 | 828,240 | ||||
Caterpillar, Inc. | 7,000 | 2 | 667,170 | |||
Cummins, Inc. | 12,200 | 2 | 910,242 | |||
Emerson Electric Co. | 17,000 | 1,064,710 | ||||
General Electric Co. | 96,100 | 3,329,865 | ||||
Illinois Tool Works, Inc. | 13,500 | 2 | 1,075,680 | |||
Ingersoll-Rand Co., Class A | 6,000 | 428,100 | ||||
ITT Industries, Inc. | 11,000 | 2 | 1,073,930 | |||
Jacobs Engineering Group, Inc.* | 10,000 | 2 | 562,600 | |||
PACCAR, Inc. | 8,000 | 544,000 | ||||
Parker Hannifin Corp. | 7,500 | 465,075 | ||||
Robert Half International, Inc. | 30,000 | 2 | 749,100 | |||
United Parcel Service, Inc., Class B | 17,700 | 1,224,132 | ||||
UTI Worldwide, Inc. | 10,100 | 2 | 703,162 | |||
Total Industrials | 15,072,006 | |||||
Information Technology - 17.5% | ||||||
Applied Materials, Inc.* | 26,900 | 2 | 435,242 | |||
Autodesk, Inc. | 25,000 | 859,250 | ||||
Cisco Systems, Inc.* | 118,700 | 2,268,357 | ||||
Dell, Inc.* | 51,600 | 2,038,716 | ||||
Electronic Arts, Inc.* | 9,800 | 2 | 554,778 | |||
EMC Corp.* | 87,000 | 1,192,770 | ||||
Google Inc.* | 1,000 | 2 | 294,150 | |||
Intel Corp. | 79,300 | 2,066,558 | ||||
Linear Technology Corp. | 12,000 | 2 | 440,280 |
The accompanying notes are an integral part of these financial statements.
9
Table of Contents
Managers Capital Appreciation Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Capital Appreciation |
Security Description | Shares | Value | |||||
Information Technology (continued) | |||||||
Marvell Technology Group Ltd.* | 8,400 | 2 | $ | 319,536 | |||
Microsoft Corp. | 100,900 | 2,506,356 | |||||
Molex, Inc. | 22,500 | 528,300 | |||||
Nokia Corp., Sponsored ADR | 25,000 | 416,000 | |||||
Qualcomm, Inc. | 11,000 | 363,110 | |||||
SAP Aktiengesellschaft Systems, Sponsored ADR | 25,000 | 1,082,500 | |||||
Texas Instruments, Inc. | 20,000 | 2 | 561,400 | ||||
VeriSign, Inc.* | 19,100 | 549,316 | |||||
Yahoo!, Inc.* | 25,600 | 887,040 | |||||
Total Information Technology | 17,363,659 | ||||||
Materials - 2.6% | |||||||
Arch Coal, Inc. | 12,000 | 2 | 653,640 | ||||
Peabody Energy Corp. | 14,000 | 728,560 | |||||
Praxair, Inc. | 25,000 | 1,165,000 | |||||
Total Materials | 2,547,200 | ||||||
Total Common Stocks | 95,473,098 | ||||||
Other Investment Companies - 26.8%l | |||||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 23,343,286 | 23,343,286 | |||||
JPMorgan Prime Money Market Fund, Institutional Class Shares, 3.04% | 3,178,045 | 3,178,045 | |||||
Total Other Investment Companies | 26,521,331 | ||||||
Total Investments - 123.1% | 121,994,429 | ||||||
Other Assets, less Liabilities - (23.1)% | (22,903,543 | ) | |||||
Net Assets - 100.0% | $ | 99,090,886 |
The accompanying notes are an integral part of these financial statements.
10
Table of Contents
June 30, 2005
Schedule of Portfolio Investments (unaudited) | Small Company |
Security Description | Shares | Value | ||||
Common Stocks - 87.1% | ||||||
Consumer Discretionary - 20.0% | ||||||
BJ’s Restaurants, Inc.* | 3,775 | $ | 76,784 | |||
Coldwater Creek, Inc.* | 19,087 | 2 | 475,457 | |||
Cost Plus, Inc.* | 8,175 | 203,884 | ||||
Fred’s, Inc. | 10,645 | 2 | 176,494 | |||
GameStop Corp.* | 16,100 | 2 | 526,631 | |||
Gentex Corp. | 13,950 | 2 | 253,890 | |||
Getty Images, Inc.* | 3,050 | 2 | 226,492 | |||
Harman International Industries, Inc. | 1,775 | 144,414 | ||||
Insight Enterprises, Inc.* | 31,575 | 2 | 637,183 | |||
MarineMax, Inc.* | 3,225 | 100,781 | ||||
Michaels Stores, Inc. | 9,200 | 2 | 380,604 | |||
O’Reilly Automotive, Inc.* | 7,400 | 2 | 220,594 | |||
Penn National Gaming, Inc.* | 11,150 | 406,975 | ||||
PEP Boys-Manny, Moe & Jack, Inc. | 14,800 | 2 | 200,392 | |||
PETsMART, Inc. | 11,700 | 355,095 | ||||
Red Robin Gourmet Burgers, Inc.* | 9,225 | 2 | 571,766 | |||
Ruby Tuesday, Inc. | 13,025 | 2 | 337,348 | |||
TBC Corp.* | 13,825 | 2 | 375,072 | |||
Tractor Supply Co.* | 9,650 | 473,815 | ||||
Total Consumer Discretionary | 6,143,671 | |||||
Consumer Staples - 1.9% | ||||||
Central European Distribution Corp.* | 3,075 | 2 | 114,790 | |||
Performance Food Group Co.* | 15,575 | 470,521 | ||||
Total Consumer Staples | 585,311 | |||||
Energy - 7.7% | ||||||
Core Laboratories N.V. * | 7,650 | 205,173 | ||||
Delta Petroleum Corp.* | 13,250 | 2 | 187,090 | |||
Duvernay Oil Corp. | 5,325 | 141,752 | ||||
Niko Resources, Ltd. | 6,925 | 326,167 | ||||
Parallel Petroleum Corp.* | 13,175 | 116,599 | ||||
Tidewater, Inc. | 8,025 | 2 | 305,913 | |||
Ultra Petroleum Corp.* | 23,900 | 2 | 725,604 | |||
Whiting Petroleum Corp.* | 9,825 | 2 | 356,746 | |||
Total Energy | 2,365,044 | |||||
Financials - 0.4% | ||||||
Boston Private Financial Holdings, Inc. | 4,475 | 2 | 112,770 | |||
Health Care - 14.0% | ||||||
Barr Laboratories, Inc.* | 8,362 | 407,563 | ||||
Connetics Corp.* | 9,500 | 2 | 167,580 | |||
Covance, Inc.* | 14,650 | 657,345 | ||||
Luminex Corp.* | 11,450 | 112,668 | ||||
Martek Biosciences Corp.* | 4,550 | 2 | 172,673 | |||
PSS World Medical, Inc.* | 29,875 | 371,944 | ||||
Resmed, Inc.* | 6,825 | 450,382 | ||||
Respironics, Inc.* | 16,625 | 600,329 | ||||
Salix Pharmaceuticals, Ltd.* | 12,625 | 2 | 222,958 | |||
Sonosite, Inc.* | 8,550 | 265,392 | ||||
The Cooper Companies, Inc. | 5,300 | 322,558 | ||||
United Surgical Partners | ||||||
International, Inc.* | 10,550 | 549,443 | ||||
Total Health Care | 4,300,835 | |||||
Industrials - 20.0% | ||||||
Actuant Corp., Class A* | 6,635 | 2 | 318,082 | |||
Aeroflex, Inc.* | 37,300 | 313,320 | ||||
Carlisle Co., Inc. | 6,100 | 418,642 | ||||
Chicago Bridge & Iron Co. N.V. | 16,650 | 2 | 380,619 | |||
ChoicePoint, Inc.* | 10,050 | 402,503 | ||||
CoStar Group, Inc.* | 3,600 | 156,960 | ||||
DeVry, Inc.* | 15,075 | 2 | 299,993 | |||
Donaldson Co., Inc. | 7,150 | 2 | 216,860 | |||
ElkCorp. | 8,400 | 239,820 | ||||
Hewitt Associates, Inc., Class A* | 11,900 | 2 | 315,469 | |||
Intermagnetics General Corp.* | 8,300 | 255,308 | ||||
Laureate Education, Inc.* | 10,950 | 2 | 524,067 | |||
Mobile Mini, Inc.* | 10,750 | 2 | 370,660 | |||
MSC Industrial Direct Co., Class A | 13,750 | 464,063 | ||||
Navigant Consulting, Inc.* | 13,650 | 2 | 241,059 | |||
NCI Building Systems, Inc.* | 6,900 | 2 | 226,320 | |||
Pentair, Inc. | 10,300 | 2 | 440,942 | |||
Providence Service Corp.* | 3,775 | 93,733 | ||||
Si International, Inc.* | 6,825 | 204,477 | ||||
UTI Worldwide, Inc. | 3,625 | 2 | 252,373 | |||
Total Industrials | 6,135,270 | |||||
Information Technology - 21.9% | ||||||
Acxiom Corp. | 24,900 | 519,911 | ||||
Alliance Data Systems Corp.* | 8,350 | 338,676 | ||||
ATMI, Inc.* | 9,200 | 2 | 266,892 | |||
Avocent Corp.* | 17,575 | 2 | 459,410 | |||
Benchmark Electronics, Inc.* | 14,025 | 426,641 | ||||
Ceridian Corp.* | 18,650 | 2 | 363,302 | |||
Digitas, Inc.* | 20,425 | 233,049 | ||||
Emulex Corp.* | 10,600 | 2 | 193,556 | |||
Excel Technology, Inc.* | 5,400 | 131,220 | ||||
Fair Isaac Corp. | 6,293 | 229,695 | ||||
FARO Technologies, Inc.* | 4,650 | 2 | 126,759 | |||
FEI Co.* | 11,050 | 2 | 252,051 | |||
International Rectifier Corp.* | 7,425 | 354,321 | ||||
MAXIMUS, Inc.* | 8,100 | 285,848 | ||||
MPS Group, Inc.* | 20,475 | 192,875 | ||||
OPNET Technologies, Inc.* | 9,050 | 73,305 | ||||
Polycom, Inc.* | 16,950 | 252,725 | ||||
Progress Software Corp.* | 12,500 | 376,875 | ||||
Radisys Corp.* | 5,350 | 86,403 | ||||
Rogers Corp.* | 8,625 | 349,745 | ||||
Silicon Image, Inc.* | 18,550 | 2 | 190,323 | |||
Tekelec* | 19,350 | 2 | 325,080 | |||
Tessera Technologies, Inc.* | 9,150 | 2 | 305,701 | |||
Tollgrade Communications, Inc.* | 10,300 | 77,250 | ||||
UNOVA, Inc.* | 10,625 | 2 | 282,944 | |||
Total Information Technology | 6,694,557 |
The accompanying notes are an integral part of these financial statements.
11
Table of Contents
Managers Small Company Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Small Company |
Security Description | Shares | Value | ||||
Materials - 1.2% | ||||||
MacDermid, Inc. | 12,100 | $ | 377,036 | |||
Total Common Stocks | 26,714,494 | |||||
Other Investment Companies - 36.3%1 | ||||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 7,161,929 | 7,161,929 | ||||
JPMorgan Prime Money Market Fund, Institutional Class Shares, 3.04% | 3,982,060 | 3,982,060 | ||||
Total Other Investment Companies | 11,143,989 | |||||
Total Investments - 123.4% | 37,858,483 | |||||
Other Assets, less Liabilities - (23.4)% | (7,187,633 | ) | ||||
Net Assets - 100.0% | $ | 30,670,850 |
The accompanying notes are an integral part of these financial statements.
12
Table of Contents
Managers International Equity Fund
June 30, 2005
Schedule of Portfolio Investments (unaudited) | International Equity |
Security Description | Shares | Value | ||||
Common Stocks - 98.4% | ||||||
Consumer Discretionary - 12.3% | ||||||
Adidas - Salomon AG (Germany) | 6,956 | $ | 1,163,212 | |||
British Sky Broadcasting PLC (United Kingdom) | 72,665 | 683,824 | ||||
Carphone Warehouse Group, The (United Kingdom) | 429,519 | 1,412,148 | ||||
Continental AG (Germany) | 25,800 | 1,851,015 | ||||
EMI Group PLC (United Kingdom) | 424,930 | 1,928,513 | ||||
Esprit Holdings Limited (Hong Kong) | 215,500 | 2 | 1,553,514 | |||
George Wimpey PLC (United Kingdom) | 89,700 | 704,095 | ||||
Grupo Televisa S. A. (Mexico) | 25,100 | 1,558,459 | ||||
Honda Motor Co., Ltd. (Japan) | 38,800 | 1,907,367 | ||||
Hyundai Motor Co., Ltd. (South Korea) | 10,200 | 562,432 | ||||
Intercontinental Hotels Group, PLC (United Kingdom) | 40,218 | 506,673 | ||||
Kesa Electricals PLC (United Kingdom) | 42,816 | 213,827 | ||||
LVMH Moet Hennessy Louis Vuitton SA (France) | 4,541 | 349,738 | ||||
Matsushita Electric Industrial Co., Ltd. (Japan) | 27,000 | 408,437 | ||||
Nissan Motor Co., Ltd. (Japan) | 17,900 | 177,120 | ||||
Pearson PLC (United Kingdom) | 61,953 | 728,030 | ||||
Publicis Groupe (France) | 11,771 | 2 | 346,411 | |||
Renault SA (France) | 23,200 | 2,038,537 | ||||
RONA Inc. (Canada)* | 26,700 | 538,011 | ||||
SES GLOBAL (France) | 107,216 | 1,612,970 | ||||
Shanghai Forte Land Company Ltd. (Hong Kong)* | 224,000 | 58,096 | ||||
Swatch Group AG (Switzerland) | 2,564 | 359,195 | ||||
Swatch Group AG, The (Switzerland) | 43,810 | 1,249,661 | ||||
Vivendi Universal SA (France) | 56,759 | 1,779,468 | ||||
Whitbread PLC (United Kingdom) | 53,742 | 914,070 | ||||
Wolters Kluwer NV (Netherlands) | 40,200 | 767,625 | ||||
Total Consumer Discretionary | 25,372,448 | |||||
Consumer Staples - 8.1% | ||||||
British American Tobacco PLC (United Kingdom) | 53,400 | 1,028,878 | ||||
Carrefour SA (France) | 14,680 | 710,252 | ||||
Delhaize Le Lion (Belgium) | 23,300 | 1,396,138 | ||||
Diageo PLC (United Kingdom) | 83,646 | 1,231,031 | ||||
Foster’s Group, Ltd. (Australia) | 200,700 | 812,251 | ||||
Groupe Danone (France) | 2,285 | 200,285 | ||||
Imperial Tobacco Group PLC (United Kingdom) | 26,084 | 701,243 | ||||
Japan Tobacco, Inc. (Japan) | 125 | 1,663,280 | ||||
Koninklijke Ahold N.V. (Netherlands)* | 390,178 | 3,197,747 | ||||
L’Oreal SA (France) | 9,000 | 644,681 | ||||
Pernod-Ricard (France) | 8,345 | 2 | 1,332,698 | |||
Reckitt Benckiser PLC (United Kingdom) | 21,772 | 639,821 | ||||
Royal Numico NV (Netherlands)* | 17,446 | 696,872 | ||||
Seven-Eleven Japan Co., Ltd. (Japan) | 34,000 | 941,680 | ||||
Tate & Lyle PLC (United Kingdom) | 76,200 | 650,065 | ||||
Tesco PLC (United Kingdom) | 95,400 | 543,724 | ||||
Yamazaki Baking Co., Ltd. (Japan) | 47,000 | 404,735 | ||||
Total Consumer Staples | 16,795,381 | |||||
Energy - 9.9% | ||||||
BP PLC (United Kingdom) | 397,200 | 4,132,491 | ||||
China Petroleum and Chemical Corp., Class H (Hong Kong) | 924,000 | 2 | 360,060 | |||
EnCana Corp. (Canada) | 78,768 | 3,108,146 | ||||
Eni S.p.A. (Italy) | 123,838 | 3,183,285 | ||||
MOL Magyar Olaj-es Gazipari Rt. (Hungary) | 8,500 | 712,566 | ||||
Oao Gazprom-Sponsored ADR (Russia) | 6,000 | 2 | 215,415 | |||
Petro-Canada (Canada) | 31,300 | 2,038,027 | ||||
Petroleo Brasileiro SA, Sponsored ADR (Brazil) | 22,400 | 2 | 1,031,296 | |||
Repsol YPF, S.A. (Spain) | 59,300 | 2 | 1,505,538 | |||
Royal Dutch Petroleum Co. (Netherlands) | 22,600 | 1,469,807 | ||||
Talisman Energy, Inc. (Canada) | 14,300 | 535,900 | ||||
Total SA (France) | 9,288 | 2 | 2,174,250 | |||
Total Energy | 20,466,781 | |||||
Financials - 27.4% | ||||||
Aiful Corp. (Japan) | 19,550 | 1,454,879 | ||||
Allianz AG (Germany) | 4,100 | 468,987 | ||||
Assurances Generales de France (France) | 21,500 | 1,757,469 | ||||
Aviva PLC (United Kingdom) | 126,100 | 1,400,779 | ||||
Banco Bilbao Vizcaya Argentaria SA (Spain) | 75,962 | 2 | 1,167,621 | |||
Bank of East Asia, Ltd. (Hong Kong) | 302,000 | 889,268 | ||||
Bank of Nova Scotia (Canada) | 49,928 | 2 | 1,652,581 | |||
Bayerische Vereinsbank AG (Germany)* | 39,541 | 1,025,619 | ||||
BNP Paribas SA (France) | 13,4002 | 915,593 | ||||
CapitaLand Ltd. (Singapore) | 230,000 | 323,596 | ||||
China Overseas Land & Investment Ltd. (Hong Kong) | 952,000 | 175,416 | ||||
Credit Agricole SA (France) | 5,800 | 146,598 | ||||
Credit Suisse Group (Switzerland)* | 61,855 | 2,425,326 | ||||
Daiwa Securities Group, Inc. (Japan) | 104,000 | 639,090 | ||||
DBS Group Holdings, Ltd. (Singapore) | 122,000 | 1,031,309 | ||||
Depfa Bank PLC (Ireland) | 58,000 | 930,911 | ||||
Deutsche Boerse AG (Germany) | 12,436 | 2 | 967,184 | |||
Deutsche Postbank AG (Germany) | 7,900 | 2 | 386,875 | |||
Efg Eurobank Ergasias (Greece) | 16,560 | 509,647 | ||||
Hang Seng Bank, Ltd. (Hong Kong) | 75,800 | 1,030,899 |
The accompanying notes are an integral part of these financial statements.
13
Table of Contents
Managers International Equity Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | International Equity |
Security Description | Shares | Value | ||||
Financials (continued) | ||||||
HBOS PLC (United Kingdom) | 109,200 | $ | 1,679,612 | |||
HDFC Bank Ltd. (India) | 15,700 | 227,300 | ||||
Henderson Land Development Co., Ltd. (Hong Kong) | 241,000 | 1,147,928 | ||||
Hong Kong Exchanges & Clearing, Ltd. (Hong Kong) | 216,000 | 556,979 | ||||
ING Groep NV (Netherlands) | 89,117 | 2,505,865 | ||||
Japan Retail Fund Investment Corp. (Japan) | 76 | 652,583 | ||||
Kennedy-Wilson Japan (Japan) | 57 | 2 | 159,920 | |||
KK DaVinci Advisors (Japan)* | 78 | 222,078 | ||||
Kookmin Bank (South Korea) | 40,074 | 1,810,346 | ||||
Macquarie Airports (Australia) | 446,540 | 1,213,254 | ||||
Manulife Financial Corp. (Canada) | 35,100 | 2 | 1,676,764 | |||
Mitsubishi Estate Co., Ltd. (Japan) | 125,000 | 1,368,998 | ||||
Mitsubishi Tokyo Financial Group, Inc. (Japan) | 148 | 1,248,709 | ||||
Mitsui Fudosan Co., Ltd. (Japan) | 120,000 | 1,339,496 | ||||
Muenchener Rueckversicherungs AG (Germany) | 12,200 | 1,293,585 | ||||
Nikko Cordial Corp. (Japan) | 87,000 | 2 | 380,471 | |||
Nomura Holdings, Inc. (Japan) | 104,000 | 1,236,700 | ||||
NTT Urban Development Corp. (Japan) | 22 | 89,929 | ||||
ORIX Corp. (Japan) | 11,100 | 1,658,945 | ||||
Promise Co., Ltd. (Japan) | 12,700 | 811,521 | ||||
Royal Bank of Scotland Group PLC (United Kingdom) | 66,100 | 1,991,030 | ||||
Shinhan Financial Group Co., Ltd. (South Korea) | 24,090 | 621,357 | ||||
Shinsei Bank, Ltd. (Japan) | 124,000 | 666,086 | ||||
Societe Generale (France) | 13,900 | 2 | 1,410,086 | |||
Standard Chartered, PLC. (United Kingdom) | 135,882 | 2,476,615 | ||||
Sumitomo Mitsui Financial Group, Inc. (Japan) | 314 | 2,113,431 | ||||
Sumitomo Realty & Development Co., Ltd. (Japan) | 127,000 | 1,415,352 | ||||
Sun Hung Kai Properties, Ltd. (Hong Kong) | 117,000 | 1,150,414 | ||||
UBS AG (Switzerland) | 17,250 | 1,345,146 | ||||
UFJ Holdings, Inc. (Japan)* | 138 | 714,578 | ||||
Unibail (France) | 7,990 | 2 | 1,025,374 | |||
Zurich Financial Services AG (Switzerland) | 6,157 | 1,056,380 | ||||
Total Financials | 56,566,479 | |||||
Health Care - 5.6% | ||||||
AstraZeneca PLC (United Kingdom) | 21,041 | 867,835 | ||||
Eisai Co., Ltd. (Japan) | 22,200 | 744,378 | ||||
Essilor International SA (France) | 16,868 | 1,150,916 | ||||
GlaxoSmithKline PLC (United Kingdom) | 77,000 | 1,861,369 | ||||
Merck KGaA (Germany) | 15,768 | 1,257,427 | ||||
Roche Holding AG (Switzerland) | 16,912 | 2,134,572 | ||||
Sanofi-Synthelabo SA (France) | 24,525 | 2 | 2,009,371 | |||
Schering AG (Germany) | 14,279 | 879,751 | ||||
Taisho Pharmaceutical Co., Ltd. (Japan) | 34,000 | 660,682 | ||||
Total Health Care | 11,566,301 | |||||
Industrials - 7.9% | ||||||
ABB, Ltd. (Switzerland)* | 154,500 | 998,699 | ||||
British Airways PLC (United Kingdom)* | 44,312 | 208,001 | ||||
Canadian National Railway Co. (Canada) | 12,200 | 2 | 704,030 | |||
Canadian Pacific Railway Ltd. (Canada) | 22,200 | 2 | 768,336 | |||
Capita Group PLC (United Kingdom) | 226,409 | 1,489,275 | ||||
Dai Nippon Printing Co., Ltd. (Japan) | 42,000 | 673,964 | ||||
European Aeronautic Defense and Space Co. (Netherlands) | 64,161 | 2,036,557 | ||||
FANUC, Ltd. (Japan) | 7,300 | 462,202 | ||||
Hutchison Whampoa, Ltd. (Hong Kong) | 120,000 | 1,079,734 | ||||
Kuehne & Nagel International AG (Switzerland) | 3,845 | 815,859 | ||||
Macquarie Infrastructure Group (Australia) | 130,100 | 410,444 | ||||
MAN AG (Germany) | 18,400 | 2 | 762,253 | |||
Mitsubishi Corp. (Japan) | 47,000 | 636,200 | ||||
RT Group PLC (United Kingdom)* | 360,539 | 25,850 | ||||
Ryanair Holdings PLC (Ireland)* | 16,400 | 2 | 735,376 | |||
Siemens AG (Germany) | 9,000 | 654,850 | ||||
SNC-Lavalin Group, Inc. (Canada) | 12,000 | 672,110 | ||||
Tostem Inax Holding Corp. (Japan) | 32,000 | 541,132 | ||||
Vinci S.A. (France)* | 17,582 | 2 | 1,461,732 | |||
Yamato Transport Co., Ltd. (Japan) | 75,000 | 1,038,005 | ||||
Total Industrials | 16,174,609 | |||||
Information Technology - 11.2% | ||||||
Au Optronics Corp., Sponsored ADR (Taiwan) | 147,900 | 2 | 2,505,426 | |||
Canon, Inc. (Japan) | 37,900 | 2 | 1,988,303 | |||
Chi Mei Optoelectronics Corp., GDR (Taiwan) (a) | 123,700 | 1,928,928 | ||||
Compal Electronics, Inc. (Taiwan) | 149,454 | 2 | 743,354 | |||
Dassault Systemes SA (France) | 23,556 | 1,139,097 | ||||
Ericsson (LM), Class B (Sweden) | 851,000 | 2,716,122 | ||||
Flextronics International, Ltd. (Singapore)* | 64,500 | 2 | 852,045 | |||
Keyence Corp. (Japan) | 4,500 | 1,004,082 | ||||
LG.Philips LCD Co., Ltd. (South Korea)* | 33,730 | 1,555,228 | ||||
Nippon Electric Glass Co., Ltd. (Japan) | 56,000 | 841,153 |
The accompanying notes are an integral part of these financial statements.
14
Table of Contents
Managers International Equity Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | International Equity |
Security Description | Shares | Value | |||||
Information Technology (continued) | |||||||
Nokia Corp., Sponsored ADR (Finland) | 95,900 | 2 | $ | 1,595,776 | |||
Research In Motion, Ltd. (Canada)* | 10,400 | 2 | 767,000 | ||||
Samsung Electronics Co., Ltd. (South Korea) | 1,860 | 881,740 | |||||
SAP AG (Germany) | 8,367 | 2 | 1,451,008 | ||||
Taiwan Semiconductor Manufacturing Co., Ltd., Sponsored ADR | 298,165 | 2,719,262 | |||||
Tom Tom NV (Netherlands)* | 19,278 | 423,368 | |||||
Total Information Technology | 23,111,892 | ||||||
Materials - 9.7% | |||||||
Alcan, Inc. (Canada) | 40,304 | 1,210,305 | |||||
Aracruz Celulose SA (Brazil) | 25,500 | 2 | 886,125 | ||||
Arcelor (Luxembourg) | 93,200 | 1,818,966 | |||||
Bayer AG (Germany) | 29,596 | 985,132 | |||||
BOC Group PLC (United Kingdom) | 46,378 | 832,516 | |||||
China Shenhua Energy Co., Ltd. (China) | 359,000 | 346,378 | |||||
Cia de Minas Buenaventura SA (Peru) | 17,200 | 395,428 | |||||
Compania Vale do Rio Doce - ADR (Brazil) | 13,600 | 398,208 | |||||
Gold Fields, Ltd. (South Africa) | 65,500 | 2 | 745,963 | ||||
Goldcorp, Inc. (Canada) | 56,000 | 891,117 | |||||
Harmony Gold Mining Co., Ltd. (South Africa) | 28,670 | 247,653 | |||||
HeidelbergCement AG (Germany) | 12,766 | 919,427 | |||||
Impala Platinum Holdings, Ltd. (South Africa) | 47,800 | 2 | 1,069,004 | ||||
JFE Holdings, Inc. (Japan) | 49,100 | 1,207,831 | |||||
Meridian Gold, Inc. (Canada)* | 48,900 | 878,347 | |||||
Placer Dome, Inc. (Canada) | 86,900 | 1,330,319 | |||||
POSCO (South Korea) | 7,600 | 1,324,855 | |||||
Rio Tinto PLC (United Kingdom) | 21,933 | 668,153 | |||||
Svenska Cellulosa AB (Sweden) | 45,900 | 1,467,006 | |||||
Syngenta AG (Switzerland)* | 10,240 | 1,048,029 | |||||
Xstrata PLC (United Kingdom) | 67,590 | 1,300,640 | |||||
Total Materials | 19,971,402 | ||||||
Telecommunication Services - 3.3% | |||||||
Bharti Tele-Ventures Ltd. (India)* | 59,200 | 330,131 | |||||
France Telecom SA (France)* | 20,593 | 2 | 599,544 | ||||
Singapore Telecommunications, Inc. (Singapore) | 1,071,857 | 1,755,715 | |||||
Sk Telecom Co., Ltd. (South Korea) | 3,700 | 650,695 | |||||
Vodafone Group PLC (United Kingdom) | 1,384,950 | 3,368,583 | |||||
Total Telecommunication Services | 6,704,668 | ||||||
Utilities - 3.0% | |||||||
CLP Holdings, Ltd. (Hong Kong) | 193,000 | 1,105,491 | |||||
E.ON AG (Germany) | 8,700 | 772,644 | |||||
Endesa, S.A. (Spain) | 65,900 | 2 | 1,532,444 | ||||
Enel SpA (Italy) | 58,400 | 2 | 509,850 | ||||
Hong Kong & China Gas Co., Ltd. (Hong Kong) | 527,000 | 1,069,042 | |||||
National Grid Transco PLC (United Kingdom) | 126,900 | 1,227,013 | |||||
Total Utilities | 6,216,484 | ||||||
Total Common Stocks | 202,946,445 | ||||||
Other Investment Companies - 17.9%l | |||||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 35,990,692 | 35,990,692 | |||||
JPMorgan Prime Money Market Fund, Institutional Class Shares, 3.04% | 950,825 | 950,825 | |||||
Total Short-Term Investments | 36,941,517 | ||||||
Total Investments - 116.3% | 239,887,962 | ||||||
Other Assets, less Liabilities - (16.3)% | (33,689,712 | ) | |||||
Net Assets - 100.0% | $ | 206,198,250 |
The accompanying notes are an integral part of these financial statements.
15
Table of Contents
Managers Emerging Markets Equity Fund
June 30, 2005
Schedule of Portfolio Investments (unaudited) | Emerging Markets |
Security Description | Shares | Value | ||||
Common Stocks - 93.4% | ||||||
Consumer Discretionary - 6.5% | ||||||
Astra International Tbk PT (Indonesia)* | 655,000 | $ | 849,633 | |||
Consorcio ARA, S.A. de C.V. (Mexico)* | 330,000 | 1,138,733 | ||||
Genting Berhad (Malaysia) | 239,600 | 1,190,425 | ||||
Hankook Tire Co., Ltd. (South Korea) | 100,000 | 1,207,321 | ||||
Land and Houses PCL (Thailand) | 3,500,000 | 573,668 | ||||
Total Consumer Discretionary | 4,959,780 | |||||
Consumer Staples - 4.0% | ||||||
Cia Brasileira de Distribuicao Grupo Pao de Acucar (Brazil) | 31,000 | 616,590 | ||||
IOI Corp., Berhad (Malaysia) | 476,000 | 1,313,845 | ||||
IOI Oleochemical Industries Berhad (Malaysia) | 416 | 1,056 | ||||
Shinsegae Co., Ltd. (South Korea) | 3,500 | 1,099,066 | ||||
Total Consumer Staples | 3,030,557 | |||||
Energy - 7.9% | ||||||
China Petroleum and Chemical Corp., Class H (Hong Kong) | 2,665,000 | 1,038,484 | ||||
LUKOIL Holdings, ADR (Russia) | 30,800 | 1,132,824 | ||||
Oil & Natural Gas Corp., Ltd. (India) | 52,000 | 1,217,413 | ||||
Petroleo Brasileiro S.A., Sponsored ADR (Brazil) | 31,600 | 2 | 1,647,308 | |||
Surgutneftegaz Sponsored ADR (Russia) | 26,000 | 2 | 969,800 | |||
Total Energy | 6,005,829 | |||||
Financials - 20.3% | ||||||
Bancolombia S.A. (Colombia) | 19,200 | 307,008 | ||||
Bank Hapoalim, Ltd. (Israel) | 320,000 | 1,004,716 | ||||
Fubon Financial Holding Co., Ltd. (Taiwan) | 939,000 | 913,348 | ||||
Grupo Financiero Banorte S.A. de C.V. (Mexico) | 227,000 | 1,495,028 | ||||
Haci Omer Sabanci Holding AS (Turkey) | 240,000 | 913,642 | ||||
ICICI Bank Ltd. (India) | 22,204 | 214,312 | ||||
ICICI Bank Ltd., Sponsored ADR (India) | 38,000 | 830,300 | ||||
Kookmin Bank, Sponsored ADR (South Korea) | 31,257 | 2 | 1,424,694 | |||
Public Bank Berhad (Malaysia)* | 550,000 | 969,737 | ||||
Samsung Fire & Marine Insurance Co., Ltd. (South Korea) | 9,300 | 747,529 | ||||
Sanlam, Ltd. (South Africa) | 820,000 | 1,438,337 | ||||
Savings Bank of The Russian Federation (Russia) | 16,000 | 1,056,000 | ||||
Shinhan Financial Group Co., Ltd. (South Korea) | 37,000 | 954,347 | ||||
SM Investments Corp. (Philippines)* | 71,560 | 326,291 | ||||
SM Prime Holdings, Inc. (Philippines) | 800 | 107 | ||||
Turkiye Is Bankasi (Isbank) (Turkey) | 287,500 | 1,658,263 | ||||
Uniao de Bancos Brasileiros SA (Brazil) | 29,000 | 2 | 1,119,980 | |||
Total Financials | 15,373,639 | |||||
Health Care - 2.2% | ||||||
Ranbaxy Laboratories, Ltd., GDR (India) | 12,230 | 297,495 | ||||
Richter Gedeon Rt (Hungary) | 9,565 | 1,404,709 | ||||
Total Health Care | 1,702,204 | |||||
Industrials - 13.8% | ||||||
Alfa, S.A. (Mexico) | 233,000 | 1,321,221 | ||||
Barloworld, Ltd. (South Africa) | 80,000 | 1,136,257 | ||||
China Shipping Development Co., Ltd. (China) | 1,600,000 | 2 | 1,206,050 | |||
Daelim Industrial Co., Ltd. (South Korea) | 17,700 | 937,655 | ||||
Daewoo Shipbuilding & Marine Engineering Co., Ltd. (South Korea) | 50,000 | 965,396 | ||||
EVA Airways Corp. (Taiwan)* | 1,881,000 | 908,888 | ||||
Malaysia International Shipping Corporation Berhad (Malaysia) | 260,000 | 1,224,737 | ||||
Reliance Industries, Ltd., Sponsored GDR (a) (India) | 34,456 | 2 | 1,003,014 | |||
Sime Darby Berhad (Malaysia) | 750,000 | 1,144,737 | ||||
Tam S.A. (Brazil)* | 83,000 | 590,121 | ||||
Total Industrials | 10,438,076 | |||||
Information Technology - 12.0% | ||||||
Advanced Semiconductor Engineering, Inc. (Taiwan)* | 1,374,584 | 1,024,138 | ||||
Compal Electronics, Inc. (Taiwan) | 1,070,000 | 1,061,089 | ||||
Hon Hai Precision Industry Co., Ltd. (Taiwan) | 251,849 | 1,307,869 | ||||
Hynix Semiconductor, Inc. (South Korea)* | 46,000 | 745,413 | ||||
Samsung Electronics Co., Ltd., GDR, (a) (South Korea) | 6,670 | 1,594,088 | ||||
Satyam Computer Services Ltd., ADR (India) | 44,900 | 1,167,400 | ||||
Taiwan Semiconductor Manufacturing Co., Ltd. (Taiwan) | 958 | 1,670 | ||||
Taiwan Semiconductor Manufacturing Co., Ltd., Sponsored ADR | 126,000 | 1,149,117 | ||||
United Microelectronics Corp. (Taiwan)* | 1,438,000 | 1,050,936 | ||||
Total Information Technology | 9,101,720 | |||||
Materials - 9.5% | ||||||
Anglo American PLC (United Kingdom)* | 50,000 | 1,169,729 | ||||
Braskem SA (Brazil) | 120,000 | 1,002,075 |
The accompanying notes are an integral part of these financial statements.
16
Table of Contents
Managers Emerging Markets Equity Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Emerging Markets |
Security Description | Shares | Value | |||||
Materials (continued) | |||||||
Compania Vale do Rio Doce – ADR (Brazil) | 42,000 | 2 | $ | 1,229,760 | |||
Formosa Chemicals & Fibre Corp. (Taiwan) | 600 | 1,164 | |||||
GMK Norilsk Nickel, Sponsored ADR (Russia) | 18,500 | 2 | 1,121,100 | ||||
Hindalco Ind., Ltd., Sponsored GDR, (a) (India) | 31,500 | 2 | 869,945 | ||||
Sappi Ltd. (South Africa) | 82,143 | 2 | 900,591 | ||||
Siam Cement Public Co., Ltd., The (Thailand) | 155,000 | 906,063 | |||||
Total Materials | 7,200,427 | ||||||
Telecommunication Services - 14.7% | |||||||
Advanced Information Services PCL (Thailand) | 410,000 | 2 | 968,740 | ||||
Bharti Tele-Ventures, Ltd. (India)* | 193,000 | 1,076,270 | |||||
Cesky Telecom a.s. (Czech Republic) | 63,300 | 1,185,864 | |||||
China Telecom Corp., Ltd., Class H (China) | 3,504,000 | 1,250,991 | |||||
Compania Anonima Nacional Telefonos de Venezuela, ADR | 43,200 | 818,208 | |||||
Mobile Telesystems, Sponsored ADR (Russia) | 33,000 | 1,110,450 | |||||
Tele Norte Leste Participacoes S.A. (Brazil) | 64,000 | 1,065,600 | |||||
Telecom Argentina Stet France Telecom S.A., Sponsored ADR | 95,000 | 1,134,300 | |||||
Telekomunikasi Indonesia Tbk P (Indonesia) | 2,000,000 | 1,033,719 | |||||
Turkcell Iletisim Hizmet AS (Turkey) | 315,331 | 1,545,367 | |||||
Total Telecommunication Services | 11,189,509 | ||||||
Utilities - 2.5% | |||||||
Empresa Nacional de Electricidad SA/Chile, ADR (Chile) | 45,000 | 2 | 1,120,500 | ||||
Tenaga Nasional Berhad (Malaysia) | 275,000 | 759,868 | |||||
Total Utilities | 1,880,368 | ||||||
Total Common Stocks | 70,882,109 | ||||||
Preferred Stock - 3.4% | |||||||
Companhia Energetica de Minas Gerais (Brazil) | 46,000,000 | 1,445,353 | |||||
Hyundai Motor Co. (South Korea) | 36,560 | 1,214,088 | |||||
Total Preferred Stock | 2,659,441 | ||||||
Other Investment Companies - 14.3%1 | |||||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 10,280,769 | 10,280,769 | |||||
JPMorgan Prime Money Market Fund, Institutional Class Shares, 3.04% | 543,233 | 543,233 | |||||
Total Other Investment Companies | $ | 10,824,002 | |||||
Total Investments - 111.1% | 84,365,552 | ||||||
Other Assets, less Liabilities - (11.1)% | (8,453,941 | ) | |||||
Net Assets - 100.0% | $ | 75,911,611 |
The accompanying notes are an integral part of these financial statements.
17
Table of Contents
June 30, 2005
Schedule of Portfolio Investments (unaudited) | Bond |
Security Description | Principal Amount | Value | |||||||
Corporate Bonds - 33.6% | |||||||||
Asset-Backed Securities - 1.9% | |||||||||
Bank of America-First Union National Bank Commercial Mortgage, Series 2001-3, 5.460%, 05/17/10 | $ | 1,500,000 | $ | 1,580,292 | |||||
Community Program Loan Trust, Series 87-A, Class A4, 4.500%, 10/01/18 | 207,096 | 206,926 | |||||||
Community Program Loan Trust, Series 87-A, Class A5, 4.500%, 04/01/29 | 3,225,000 | 3,090,845 | |||||||
Continental Airlines, Inc., 6.648%, 09/15/17 | 1,616,179 | 1,594,806 | |||||||
Total Asset-Backed Securities | 6,472,869 | ||||||||
Finance - 9.7% | |||||||||
ASIF Global Financial, 2.380%, 02/26/09 (a) | SGD | 5,800,000 | 3,441,721 | ||||||
Barclays Capital Corp., 4.100%, 02/22/10 (a) 7 | THB | 109,000,000 | 2,636,629 | ||||||
Barclays Capital Corp., 4.160%, 02/22/10 (a) 7 | THB | 25,000,000 | 602,856 | ||||||
Cerro Negro Finance Ltd., 7.900%, 12/01/20 (a) | 500,000 | 457,500 | |||||||
Citibank N.A., 15.000%, 07/02/10 (a) 7 | BRL | 2,000,000 | 876,185 | ||||||
Citigroup, Inc., 3.500%, 02/01/08 | 2,020,000 | 1,991,524 | |||||||
EOP Operating LP, 6.750%, 02/15/12 | 500,000 | 550,399 | |||||||
General Electric Capital Corp., 6.625%, 02/04/10 | NZD | 3,500,000 | 2,444,154 | ||||||
General Motors Acceptance Corp., 3.700%, 03/20/07 | 1,500,000 | 1,454,754 | |||||||
General Motors Acceptance Corp., 5.625%, 05/15/09 | 500,000 | 2 | 468,247 | ||||||
General Motors Acceptance Corp., 7.500%, 12/01/06 | NZD | 1,000,000 | 661,463 | ||||||
GMAC International Finance BV, 8.000%, 03/14/07 | NZD | 950,000 | 637,511 | ||||||
GMAC, 6.125%, 01/22/08 | 2,000,000 | 2 | 1,936,036 | ||||||
GMAC, 6.875%, 09/15/11 | 250,000 | 230,772 | |||||||
GMAC, 7.000%, 12/07/05 | GBP | 250,000 | 447,754 | ||||||
Highwoods Properties, Inc., 7.500%, 04/15/18 | 2,250,000 | 2,519,674 | |||||||
Inter-American Development Bank, 0.000%, 05/11/09 4 | BRL | 6,500,000 | 1,562,037 | ||||||
International Bank for Reconstruction & Development, 0.000%, 08/20/07 4,7 | NZD | 4,800,000 | 2,921,147 | ||||||
JPMorgan Chase & Co., 4.000%, 02/01/08 | 1,000,000 | 994,911 | |||||||
JPMorgan Chase & Co., 0.000%, 05/17/10 (a) 4,7 | BRL | 3,600,000 | 808,810 | ||||||
Morgan Stanley & Co., Inc., 3.625%, 04/01/08 | 2,100,000 | 2,067,444 | |||||||
New Plan Excel Realty Trust, 5.875%, 06/15/07 | 1,250,000 | 1,287,863 | |||||||
NiSource Finance Corp., 6.150%, 03/01/13 | 1,250,000 | 1,350,805 | |||||||
SLM Corp., 6.500%, 06/15/10 | NZD | 500,000 | 345,553 | ||||||
Spieker Properties, Inc., 7.350%, 12/01/17 | 250,000 | 294,752 | |||||||
Total Finance | 32,990,501 | ||||||||
Industrials - 18.7% | |||||||||
Abitibi-Consolidated, Inc., 7.500%, 04/01/28 | 500,000 | 433,750 | |||||||
Altria Group, Inc., 7.000%, 11/04/13 | 1,500,000 | 2 | 1,678,649 | ||||||
America Movil, S.A. de C.V., 4.125%, 03/01/09 | 3,000,000 | 2,937,642 | |||||||
American Airlines, Inc., Series 01-2, 6.978%, 04/01/11 | 1,814,636 | 1,874,695 | |||||||
American Airlines, Inc., 8.608%, 04/01/11 | 125,000 | 2 | 117,203 | ||||||
American President, Ltd., 8.000%, 01/15/24 | 250,000 | 262,500 | |||||||
Arrow Electronics, Inc., 6.875%, 07/01/13 | 500,000 | 549,708 | |||||||
Bausch & Lomb, Inc., 7.125%, 08/01/28 | 500,000 | 561,639 | |||||||
Bowater, Inc., 6.500%, 06/15/13 | 500,000 | 2 | 493,750 | ||||||
Chiron Corp., 1.625%, 08/01/33 | 4,735,000 | 4,391,713 | |||||||
Cia Brasileira de Bebida, 8.750%, 09/15/13 | 3,795,000 | 2 | 4,387,959 | ||||||
Clear Channel Communications, 4.250%, 05/15/09 | 1,500,000 | 1,445,502 | |||||||
Clear Channel Communications, 5.750%, 01/15/13 | 500,000 | 488,555 | |||||||
Continental Airlines, Inc., Series 991A, 6.545%, 02/02/19 | 4,283,537 | 4,288,170 | |||||||
Continental Airlines, Inc., Series 01-1, 6.703%, 06/15/21 | 403,287 | 393,724 |
The accompanying notes are an integral part of these financial statements.
18
Table of Contents
Managers Bond Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Bond |
Security Description | Principal Amount | Value | |||||
Industrials (continued) | |||||||
Continental Airlines, Inc., 6.795%, 08/02/20 | $ | 57,768 | $ | 48,230 | |||
Continental Airlines, Inc., Series 99-2, 7.256%, 03/15/20 | 367,387 | 370,317 | |||||
Corning, Inc., 6.850%, 03/01/29 | 3,400,000 | 3,513,509 | |||||
Delphi Corp., 7.125%, 05/01/29 | 1,950,000 | 2 | 1,345,500 | ||||
Devon Energy Corp., 4.900%, 08/15/08 | 1,250,000 | 1,404,688 | |||||
Devon Energy Corp., 4.950%, 08/15/08 | 1,692,000 | 2 | 1,901,385 | ||||
Dillards, Inc., 7.000%, 12/01/28 | 225,000 | 208,125 | |||||
Foot Locker, Inc., 8.500%, 01/15/22 | 570,000 | 625,575 | |||||
Ford Motor Co., 6.375%, 02/01/29 | 2,500,000 | 1,927,555 | |||||
General Motors Corp., 6.750%, 05/01/28 | 500,000 | 366,250 | |||||
Georgia-Pacific Corp., 7.250%, 06/01/28 | 500,000 | 535,000 | |||||
Georgia-Pacific Corp., 7.750%, 11/15/29 | 925,000 | 1,039,469 | |||||
HCA, Inc., 5.750, 03/15/14 | 2,500,000 | 2 | 2,488,960 | ||||
HCA, Inc., 6.250%, 02/15/13 | 1,940,000 | 1,982,899 | |||||
HCA, Inc., 7.050%, 12/01/27 | 1,600,000 | 1,605,408 | |||||
HCA, Inc., 7.580%, 09/15/25 | 125,000 | 131,794 | |||||
Hutchison Whampoa International, Ltd., 5.450%, 11/24/10 (a) | 2,225,000 | 2,298,950 | |||||
International Paper Co., 4.000%, 04/01/10 | 1,000,000 | 966,407 | |||||
International Paper Co., 4.250%, 01/15/09 | 1,000,000 | 987,062 | |||||
Kellwood Co., 7.625%, 10/15/17 7 | 250,000 | 268,476 | |||||
Lowe’s Co., Inc., 6.875%, 02/15/28 | 500,000 | 620,292 | |||||
MacMillan Bloedel Ltd., 7.700%, 02/15/26 | 1,350,000 | 1,615,824 | |||||
Motorola, Inc., 5.800%, 10/15/08 | 250,000 | 260,997 | |||||
Motorola, Inc., 7.625%, 11/15/10 | 375,000 | 429,084 | |||||
Motorola, Inc., 8.000%, 11/01/11 | 1,075,000 | 1,267,295 | |||||
Pemex Project Funding Master Trust, 8.625%, 12/01/23 (a) | 950,000 | 1,154,250 | |||||
Penney (JC), Co., 7.125%, 11/15/23 | 33,000 | 35,805 | |||||
PF Export Rec Master Trust, 6.436%, 06/01/15 (a) | 806,927 | 827,447 | |||||
Raytheon Co., 7.000%, 11/01/28 | 1,500,000 | 1,837,761 | |||||
Raytheon Co., 7.200%, 08/15/27 | 800,000 | 998,933 | |||||
Samsung Electronics Co., Ltd., 7.700%, 10/01/27 (a) | 1,800,000 | 1,935,614 | |||||
Schering-Plough Corp., 5.300%, 12/01/13 | 1,500,000 | 1,590,377 | |||||
Teck Cominco Ltd., 7.000%, 09/15/12 | 1,000,000 | 1,116,660 | |||||
Telekom Malaysia Berhad, 7.875%, 08/01/25 (a) | 250,000 | 322,000 | |||||
US West Communications, Inc., 7.250%, 09/15/25 | 500,000 | 467,500 | |||||
Williams Co., Inc., Series A, 7.500%, 01/15/31 | 1,000,000 | 1,082,500 | |||||
Total Industrials | 63,883,057 | ||||||
Utilities - 3.3% | |||||||
Coastal Corp., 6.950%, 06/01/28 | 300,000 | 262,500 | |||||
Constellation Energy Group, Inc., 4.550%, 06/15/15 | 1,675,000 | 1,617,229 | |||||
El Paso Corp., 6.750%, 05/15/09 | 250,000 | 2 | 250,000 | ||||
El Paso Corp., 7.000%, 05/15/11 | 500,000 | 498,750 | |||||
Empresa Nacional de Electricidad SA, 8.625%, 08/01/15 | 300,000 | 2 | 358,503 | ||||
Empresa Nacional de Electricidad, Yankee, 7.875%, 02/01/27 | 2,900,000 | 3,208,067 | |||||
Enersis SA, Yankee, 7.400%, 12/01/16 | 225,000 | 244,631 | |||||
MidAmerican Energy Holdings, 5.875%, 10/01/12 | 750,000 | 796,663 | |||||
Southern Natural Gas Co., 7.350%, 02/15/31 | 1,000,000 | 1,063,782 | |||||
Tenaga Nasional Berhad, 7.500%, 11/01/25 (a) | 2,000,000 | 2 | 2,405,490 | ||||
Transocean, Inc., 7.375%, 04/15/18 | 500,000 | 616,223 | |||||
Total Utilities | 11,321,838 | ||||||
Total Corporate Bonds | 114,668,265 |
The accompanying notes are an integral part of these financial statements.
19
Table of Contents
Managers Bond Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Bond |
Security Description | Principal Amount | Value | |||||||
Foreign Government and Agency Obligations - 3.7% | |||||||||
British Columbia, Province of, 6.000%, 06/09/08 | CAD | $ | 560,000 | $ | 494,590 | ||||
Kommunekredit, 5.000%, 06/07/06 | NOK | 1,600,000 | 250,346 | ||||||
Manitoba, Province of, 5.750%, 06/02/08 | CAD | 3,800,000 | 3,331,360 | ||||||
Mexican Government, 9.000%, 12/20/12 | MXN | 71,000,000 | 6,476,698 | ||||||
Mexico Government, 7.500%, 01/14/12 | 1,250,000 | 1,417,500 | |||||||
Ontario Province, 5.900%, 03/08/06 | CAD | 585,000 | 487,893 | ||||||
Province of Alberta, Series CS, Sinking Fund, 5.930%, 09/16/16 | CAD | 201,318 | 183,571 | ||||||
Total Foreign Government and Agency Obligations | 12,641,958 | ||||||||
U.S. Government and Agency Obligations - 49.6% | |||||||||
U.S. Government Agency Obligations - 12.6% | |||||||||
FHLMC, 2.875%, 09/01/05 | 3,500,000 | 3,495,541 | |||||||
FHLMC, 3.220%, 06/20/07 | SGD | 500,000 | 302,667 | ||||||
FHLMC, Gold, 5.000%, 12/01/31 | 262,724 | 263,337 | |||||||
FHLMC, 5.250%, 01/01/06 | 3,300,000 | 3,324,958 | |||||||
FHLMC, 5.500%, 09/15/11 | 5,090,000 | 5,474,804 | |||||||
FNMA, 2.290%, 02/19/09 | SGD | 3,800,000 | 2,257,407 | ||||||
FNMA, 2.375%, 02/15/07 | 7,000,000 | 2 | 6,846,224 | ||||||
FNMA, 3.250%, 01/15/08 | 3,000,000 | 2 | 2,958,714 | ||||||
FNMA, 4.000%, 10/01/18 | 5,691,590 | 5,583,097 | |||||||
FNMA, 4.000%, 10/01/18 | 6,103,768 | 5,987,418 | |||||||
FNMA, 5.000%, 01/15/07 | 3,200,000 | 2 | 3,258,218 | ||||||
FNMA, 5.250%, 04/15/07 | 3,200,000 | 3,278,445 | |||||||
FNMA, 6.000%, 07/01/29 | 32,319 | 33,218 | |||||||
Total U.S. Government Agency Obligations | 43,064,048 | ||||||||
U.S. Treasury Notes - 37.0% | |||||||||
USTN, 1.625%, 09/30/05 | 3,500,000 | 2 | 3,486,739 | ||||||
USTN, 1.625%, 10/31/05 | 7,000,000 | 6,962,263 | |||||||
USTN, 1.625%, 02/28/06 | 12,000,000 | 2 | 11,857,968 | ||||||
USTN, 1.875%, 12/31/05 | 11,000,000 | 2 | 10,917,071 | ||||||
USTN, 2.375%, 08/15/06 | 985,000 | 2 | 972,149 | ||||||
USTN, 2.500%, 09/30/06 | 10,000,000 | 2 | 9,867,190 | ||||||
USTN, 2.750%, 06/30/06 | 40,000,000 | 2 | 39,692,200 | ||||||
USTN, 2.750%, 07/31/06 | 14,785,000 | 14,659,668 | |||||||
USTN, 3.000%, 02/15/08 | 20,000,000 | 2 | 19,675,780 | ||||||
USTN, 3.250%, 08/15/08 | 5,000,000 | 2 | 4,937,695 | ||||||
USTN, 3.500%, 11/15/06 | 3,400,000 | 2 | 3,396,148 | ||||||
Total U.S. Treasury Notes | 126,424,871 | ||||||||
Total U.S. Government and Agency Obligations | 169,488,919 | ||||||||
Preferred Stock - 0.9% | |||||||||
Entergy Louisiana, Inc., 4.440% | 226 | 19,796 | |||||||
Entergy New Orleans, Inc., 4.750% | 482 | 44,781 | |||||||
Entergy New Orleans, Inc., 5.560% | 100 | 10,875 | |||||||
Newell Financial Trust I, 5.250% | 32,000 | 1,396,000 | |||||||
Travelers Property Casualty Corp., 4.500% | 66,175 | 1,480,997 | |||||||
Union Electric Co., 3.500% | 350 | 25,769 | |||||||
Wisconsin Electric Power Co., 3.600% | 3,946 | 236,760 | |||||||
Total Preferred Stock | 3,214,978 |
The accompanying notes are an integral part of these financial statements.
20
Table of Contents
Managers Bond Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Bond |
Security Description | Shares | Value | ||||
Other Investment Companies - 23.8%1 | ||||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 43,688,765 | $ | 43,688,765 | |||
JPMorgan Prime Money Market Fund, Institutional Class Shares, 3.04% | 37,674,885 | 37,674,885 | ||||
Total Other Investment Companies | 81,363,650 | |||||
Total Investments - 111.6% | 381,377,770 | |||||
Other Assets, less Liabilities - (11.6)% | (39,845,367 | ) | ||||
Net Assets - 100.0% | $ | 341,532,403 |
The accompanying notes are an integral part of these financial statements.
21
Table of Contents
June 30, 2005
Schedule of Portfolio Investments (unaudited) | Global Bond |
Security Description | Principal Amount | Value | ||||||
Foreign Government and Agency Obligations - 44.6% | ||||||||
Foreign Government - 44.6% | ||||||||
Belgium Government Bond, 3.750%, 03/28/09 | EUR | 415,000 | $ | 527,828 | ||||
Brazil, Republic of, 8.000%, 04/15/14 | USD | 79,162 | 2 | 81,085 | ||||
Bundes Immobil, 4.625%, 09/27/12 | EUR | 525,000 | 701,790 | |||||
Bundes Obligation, 3.250%, 04/17/09 (a) | EUR | 525,000 | 657,297 | |||||
Bundes Obligation, Series 139, 4.000%, 02/16/07 | EUR | 890,000 | 1,111,110 | |||||
Canada Government, 0.700%, 03/20/06 | JPY | 19,000,000 | 172,193 | |||||
Colombia, Republic of, 8.125%, 05/21/24 | USD | 140,000 | 139,650 | |||||
Denmark, Kingdom of, 6.000%, 11/15/09 | DKK | 2,320,000 | 433,239 | |||||
Development Bank of Japan, 2.875%, 12/20/06 | JPY | 30,000,000 | 281,926 | |||||
Federal Republic of Brazil, 8.750%, 02/04/25 | USD | 105,000 | 108,150 | |||||
Irish Government, 4.600%, 04/18/16 | EUR | 610,000 | 835,059 | |||||
Kingdom of Denmark, 4.000%, 08/15/08 | DKK | 1,465,000 | 250,829 | |||||
Kingdom of Spain, 3.100%, 09/20/06 | JPY | 30,000,000 | 280,800 | |||||
Mexican Government, 9.000%, 12/20/12 | MXN | 2,000,000 | 182,443 | |||||
Netherlands Government SA, 5.500%, 01/15/28 | EUR | 560,000 | 871,772 | |||||
Ontario Province, 5.700%, 12/01/08 | CAD | 305,000 | 269,213 | |||||
Province of Saskatchewan, 5.750%, 03/05/29 | CAD | 120,000 | 113,371 | |||||
Queensland Treasury Corp., 8.000%, 09/14/07 | AUD | 955,000 | 769,034 | |||||
Republic of Deutschland, Series 02, 5.000%, 01/04/12 | EUR | 360,000 | 493,779 | |||||
Republic of Italy, 0.375%, 10/10/06 | JPY | 119,000,000 | 1,078,654 | |||||
Republic of Italy, 3.800%, 03/27/08 | JPY | 20,000,000 | 198,288 | |||||
Republic of Poland, 1.020%, 06/09/09 | JPY | 100,000,000 | 914,177 | |||||
Republic of South Africa, 5.250%, 05/16/13 | EUR | 350,000 | 465,125 | |||||
Singapore Government, 3.625%, 07/01/11 | SGD | 660,000 | 418,845 | |||||
Singapore Government, 4.625%, 07/01/10 | SGD | 1,665,000 | 1,095,048 | |||||
Spain, Government of, 3.600%, 01/31/09 | EUR | 945,000 | 1,194,764 | |||||
Swedish Government, 5.250%, 03/15/11 | SEK | 5,550,000 | 813,280 | |||||
Swedish Government, 6.500%, 05/05/08 | SEK | 3,145,000 | 452,562 | |||||
U.K. Treasury, 5.000%, 03/07/12 | GBP | 470,000 | 885,500 | |||||
U.K. Treasury, 6.250%, 11/25/10 | GBP | 185,000 | 366,715 | |||||
United Mexican States, 4.250%, 06/16/15 | EUR | 250,000 | 300,483 | |||||
United Mexican States, Series 6Rg, 6.750%, 06/06/06 | JPY | 18,000,000 | 172,122 | |||||
USTB, 5.000%, 03/07/25 | GBP | 360,000 | 713,064 | |||||
Total Foreign Government and Agency Obligations | 17,349,195 | |||||||
Corporate Bonds - 37.4% | ||||||||
Asset-Backed Securities - 1.7% | ||||||||
DaimlerChrysler Auto Trust, Class A4, Series 2005-A, 3.740%, 02/08/10 | USD | 340,000 | 337,552 | |||||
Honda Auto Receivables Owner Trust, Class A4, Series 2005-1, 3.820%, 05/21/10 | USD | 330,000 | 327,810 | |||||
Total Asset-Backed Securities | 665,362 | |||||||
Finance - 18.5% | ||||||||
Arcel Finance Ltd., 7.048%, 09/01/11 (a) | USD | 105,000 | 108,526 | |||||
Barclays Capital Corp., 4.100%, 02/22/10 (a) 7 | THB | 8,000,000 | 193,514 | |||||
Barclays Capital Corp., 4.160%, 02/22/10 (a) 7 | THB | 7,000,000 | 168,800 | |||||
Cerro Negro Finance Ltd., 7.900%, 12/01/20 (a) | USD | 65,000 | 59,475 | |||||
CIT Group Inc., 5.500%, 12/01/14 | GBP | 80,000 | 146,910 | |||||
Citibank N.A., 15.000%, 07/02/10 (a) 7 | BRL | 900,000 | 394,283 | |||||
Couche-Tard US/Finance, 7.500%, 12/15/13 | USD | 160,000 | 168,000 | |||||
Depfa ACS Bank, 0.750%, 09/22/08 | JPY | 40,000,000 | 367,878 |
The accompanying notes are an integral part of these financial statements.
22
Table of Contents
Managers Global Bond Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Global Bond |
Security Description | Principal Amount | Value | ||||||
Finance (continued) | ||||||||
European Investment Bank, 3.000%, 09/20/06 | JPY | 30,000,000 | $ | 280,203 | ||||
Federal Farm Credit Bank, 3.250%, 06/15/07 | USD | 600,000 | 593,302 | |||||
Ford Credit of Canada Ltd., 7.250%, 12/07/07 | GBP | 25,000 | 44,466 | |||||
Ford Motor Credit Co., 5.700%, 01/15/10 | USD | 30,000 | 27,670 | |||||
GMAC International Finance BV, 8.000%, 03/14/07 | NZD | 160,000 | 107,370 | |||||
Hypothekenbank in Essen AG, 5.250%, 01/22/08 | EUR | 810,000 | 1,053,607 | |||||
Inter-American Development Bank, 1.900%, 07/08/09 | JPY | 40,000,000 | 386,003 | |||||
International Bank for Reconstruction & Development, 2.000%, 02/18/08 | JPY | 20,000,000 | 188,731 | |||||
Japan Bank for International Cooperation., 0.350%, 03/19/08 | JPY | 18,000,000 | 163,741 | |||||
KfW International Finance, Inc., 1.750%, 03/23/10 | JPY | 20,000,000 | 192,538 | |||||
KfW International Finance, Inc., 2.050%, 09/21/09 | JPY | 148,000,000 | 1,434,877 | |||||
MBNA Europe Funding, PLC, 6.500%, 03/27/07 | EUR | 50,000 | 64,600 | |||||
Morgan Stanley Co., Series EMTN, 5.375%, 11/14/13 | GBP | 120,000 | 220,498 | |||||
Muenchener Hypothekenbank eG, 5.000%, 01/16/12 | EUR | 30,000 | 40,972 | |||||
NGG Finance, PLC., 6.125%, 08/23/11 | EUR | 55,000 | 77,442 | |||||
Nordic Investment Bank, 5.250%, 04/20/06 | SEK | 2,000,000 | 262,975 | |||||
Qwest Capital Funding, Inc., 7.250%, 02/15/11 | USD | 75,000 | 2 | 71,813 | ||||
Russell Corp., 9.250%, 05/01/10 | USD | 55,000 | 58,025 | |||||
RWE Finance B.V, 6.125%, 10/26/12 | EUR | 55,000 | 79,479 | |||||
Simon Property Group, L.P., 4.825%, 03/18/10 | USD | 180,000 | 183,156 | |||||
SLM Corp., 6.500%, 06/15/10 | NZD | 85,000 | 58,745 | |||||
Total Finance | 7,197,599 | |||||||
Industrials - 14.7% | ||||||||
AGCO Corp., 6.875%, 04/15/14 | EUR | 120,000 | 152,905 | |||||
America Movil, S.A. de C.V., 4.125%, 03/01/09 | USD | 135,000 | 132,194 | |||||
American Standard, Inc., 7.125%, 06/01/06 | EUR | 75,000 | 94,431 | |||||
American Standard, Inc., 8.250%, 06/01/09 | GBP | 50,000 | 98,137 | |||||
ASIF Global, 2.380%, 02/26/09 (a) | SGD | 500,000 | 296,700 | |||||
Avenor Inc., 10.850%, 11/30/14 | CAD | 165,000 | 158,030 | |||||
Bavaria S.A., 8.875%, 11/01/10 (a) | USD | 60,000 | 66,090 | |||||
Canadian Pacific Railway, Ltd., 4.900%, 06/15/10 | CAD | 195,000 | 167,024 | |||||
Casino Guichard-Perrach S.A., 4.750%, 07/21/11 | EUR | 170,000 | 213,960 | |||||
Corning Inc., 6.750%, 09/15/13 | USD | 125,000 | 135,069 | |||||
DaimlerChrysler N.A. Holdings Corp., 4.875%, 06/15/10 | USD | 95,000 | 94,563 | |||||
Del Monte Foods Co., 6.750%, 02/15/15 (a) | USD | 150,000 | 2 | 153,000 | ||||
Deutsche Telekom, 5.250%, 05/20/08 | EUR | 60,000 | 78,082 | |||||
Diageo Capital Beverages, 3.875%, 01/06/09 | EUR | 65,000 | 82,090 | |||||
Enterprise Products Operating L.P., 4.950%, 06/01/10 | USD | 90,000 | 90,423 | |||||
EOP Operating LP, 4.650%, 10/01/10 | USD | 320,000 | 2 | 319,239 | ||||
Fisher Scientific International, Inc., 6.125%, 07/01/15 (a) | USD | 145,000 | 145,181 | |||||
Hanarotelecom, Inc., 7.000%, 02/01/12 (a) | USD | 50,000 | 49,624 | |||||
HCA, Inc., 5.250%, 11/06/08 | USD | 150,000 | 149,816 | |||||
Hutchison Whampoa International, Ltd., 7.450%, 11/24/33 (a) | USD | 80,000 | 2 | 94,127 | ||||
Lubrizol Corp., The, 4.625%, 10/01/09 | USD | 160,000 | 160,020 | |||||
Lucent Technologies, Inc., 6.450%, 03/15/29 | USD | 115,000 | 2 | 102,925 | ||||
McDonald’s Corp., 3.628%, 10/10/10 | SGD | 250,000 | 155,190 | |||||
MGM MIRAGE, 6.000%, 10/01/09 | USD | 180,000 | 180,900 | |||||
News America Holdings, 8.625%, 02/07/14 7 | AUD | 350,000 | 2 | 286,278 | ||||
Pearson PLC, 6.125%, 02/01/07 | EUR | 35,000 | 44,789 | |||||
Pemex Project Funding Master Trust, 7.875%, 02/01/09 | USD | 325,000 | 355,063 | |||||
Phillips-Van Heusen Corp., 7.250%, 02/15/11 | USD | 70,000 | 2 | 73,500 |
The accompanying notes are an integral part of these financial statements.
23
Table of Contents
Managers Global Bond Fund
June 30, 2005
Schedule of Portfolio Investments (continued) | Global Bond |
Security Description | Principal Amount | Value | |||||||
Industrials (continued) | |||||||||
Quest Corp., 7.875%, 09/01/11 | USD | 75,000 | $ | 78,188 | |||||
Rogers Wireless Communications, Inc., 6.375%, 03/01/14 | USD | 70,000 | 71,225 | ||||||
Rogers Wireless Inc., 7.625%, 12/15/11 | CAD | 115,000 | 100,935 | ||||||
Shaw Communications, Inc., 7.500%, 11/20/13 | CAD | 175,000 | 156,591 | ||||||
Sing Telecommunications, 6.000%, 11/21/11 | EUR | 50,000 | 70,327 | ||||||
Smithfield Foods, Inc., 7.000%, 08/01/11 | USD | 145,000 | 152,613 | ||||||
Stena AB, 7.000%, 12/01/16 | USD | 85,000 | 78,837 | ||||||
Stena AB, 7.500%, 11/01/13 | USD | 75,000 | 73,875 | ||||||
Telecom Italia SPA., 4.950%, 09/30/14 (a) | USD | 180,000 | 178,226 | ||||||
The Premcor Refining Group, Inc., 6.750%, 02/01/11 | USD | 135,000 | 145,800 | ||||||
Vale Overseas Limited., 8.250%, 01/17/34 | USD | 50,000 | 55,000 | ||||||
Williams Co., Inc., 7.875%, 09/01/21 | USD | 90,000 | 102,375 | ||||||
WPP Group, PLC. 6.000%, 06/18/08 | EUR | 50,000 | 66,275 | ||||||
Xerox Corp., 6.875%, 08/15/11 | USD | 140,000 | 2 | 148,400 | |||||
XTO Energy, Inc., 5.300%, 06/30/15 | USD | 100,000 | 2 | 101,913 | |||||
Total Industrials | 5,709,930 | ||||||||
Utilities - 2.5% | |||||||||
Carolina Power & Light Co., 5.150%, 04/01/15 | USD | 140,000 | 144,933 | ||||||
Empresa Nacional de Electricidad, Yankee, 7.875%, 02/01/27 | USD | 100,000 | 110,623 | ||||||
Enersis SA, Yankee, 7.400%, 12/01/16 | USD | 80,000 | 86,980 | ||||||
Pioneer Natural Resources Co., 6.500%, 01/15/08 | USD | 60,000 | 62,227 | ||||||
Scottish Power, 6.625%, 01/14/10 | GBP | 90,000 | 173,824 | ||||||
Tennessee Valley Authority, 5.375%, 11/13/08 | USD | 360,000 | 376,196 | ||||||
Total Utilities | 954,783 | ||||||||
Total Corporate Bonds | 14,527,674 | ||||||||
U.S. Government and Agency Obligations - 12.7% | |||||||||
U.S. Government and Agency Obligations - 6.1% | |||||||||
Federal Farm Credit Bank, 4.125%, 04/15/09 | USD | 185,000 | 186,174 | ||||||
Federal Farm Credit Banks Funding Corp., 3.375%, 07/15/08 | USD | 650,000 | 640,256 | ||||||
FNMA, 1.750%, 03/26/08 | JPY | 140,000,000 | 1,317,896 | ||||||
FNMA, 2.290%, 02/19/09 | SGD | 400,000 | 237,622 | ||||||
Total U.S. Agency | 2,381,948 | ||||||||
U.S. Treasury - 5.7% | |||||||||
USTB, 4.000%, 02/15/15 | USD | 75,000 | 2 | 75,267 | |||||
USTN, 2.500%, 10/31/06 | USD | 710,000 | 2 | 699,905 | |||||
USTN, 3.250%, 08/15/08 | USD | 615,000 | 2 | 607,336 | |||||
USTN, 5.750%, 08/15/10 | USD | 750,000 | 2 | 819,697 | |||||
Total U.S. Treasury | 2,202,205 | ||||||||
Other MBS - 0.9% | |||||||||
Permanent Financing PLC, 5.100%, 06/11/07 | EUR | 275,000 | 350,624 | ||||||
Total U.S. Government and Agency Obligations | 4,934,777 | ||||||||
Shares | |||||||||
Other Investment Companies - 11.6%1 | |||||||||
Bank of New York Institutional Cash Reserves Fund, 3.32%3 | 2,977,802 | 2,977,802 | |||||||
JPMorgan Prime Money Market, Institutional Class Shares, 3.04% | 1,526,522 | 1,526,522 | |||||||
Total Other Investment Companies | 4,504,324 | ||||||||
Total Investments - 106.3% | 41,315,970 | ||||||||
Other Assets, less Liabilities - (6.3)% | (2,445,211 | ) | |||||||
Net Assets - 100.0% | $ | 38,870,759 |
The accompanying notes are an integral part of these financial statements.
24
Table of Contents
Notes to Schedules of Portfolio Investments (unaudited)
The following footnotes and abbreviations should be read in conjunction with each of the Schedules of Portfolio Investments previously presented in this report.
At June 30, 2005, the cost of securities for Federal income tax purposes and the gross aggregate unrealized appreciation and/or depreciation based on tax cost were approximately:
Fund | Cost | Appreciation | Depreciation | Net | |||||||||
Value | $ | 130,082,383 | $ | 20,621,145 | $ | (1,892,314 | ) | $ | 18,728,831 | ||||
Capital Appreciation | 113,621,153 | 10,465,533 | (2,092,257 | ) | 8,373,276 | ||||||||
Small Company | 31,322,854 | 7,465,060 | (929,431 | ) | 6,535,629 | ||||||||
International Equity | 210,342,560 | 34,770,987 | (5,225,585 | ) | 29,545,402 | ||||||||
Emerging Markets | 70,309,614 | 15,595,129 | (1,539,191 | ) | 14,055,938 | ||||||||
Bond | 373,851,105 | 10,083,002 | (2,556,337 | ) | 7,526,665 | ||||||||
Global Bond | 40,561,497 | 1,387,776 | (633,303 | ) | 754,473 |
* | Non-income-producing security |
(a) | Security exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions exempt from registration, normally to qualified buyers. At June 30, 2005, the value of these securities amounted to the following: |
Fund | Market Value | % of Net Assets | ||||
International Equity | $ | 1,928,928 | 0.9 | % | ||
Emerging Markets | 3,467,047 | 4.6 | % | |||
Bond | 17,767,452 | 5.2 | % | |||
Global Bond | 2,564,843 | 6.6 | % |
1 | Yield shown for an investment company represents its June 30, 2005, seven-day average yield, which refers to the sum of the previous seven days’ dividends paid, expressed as an annual percentage. |
2 | Some or all of these shares were out on loan to various brokers as of June 30, 2005, amounting to: |
Fund | Market Value | % of Net Assets | ||||
Value | $ | 31,241,498 | 26.7 | % | ||
Capital Appreciation | 23,908,921 | 24.1 | % | |||
Small Company | 6,968,599 | 22.7 | % | |||
International Equity | 34,377,020 | 16.7 | % | |||
Emerging Markets | 9,990,188 | 13.2 | % | |||
Bond | 94,553,797 | 27.7 | % | |||
Global Bond | 3,409,253 | 8.8 | % |
3 | Collateral received from brokers for securities lending was invested in these short-term investments. |
4 | Zero coupon security. |
5 | Affiliated Company – See Note 10 in the Notes to Financial Statements. |
6 | When Issued Security. |
7 | Security is Illiquid. |
Investments Definitions and Abbreviations:
ADR/GDR: | ADR after the name of a holding stands for American Depositary Receipt, representing ownership of foreign securities on deposit with a domestic custodian bank; a GDR (Global Depositary Receipt) is comparable, but foreign securities are held on deposit in a non-U.S. bank. The value of the ADR/GDR securities is determined or significantly influenced by trading on exchanges not located in the United States or Canada. Sponsored ADR/GDRs are initiated by the underlying foreign company. |
FHLMC: Federal Home Loan Mortgage Corp. | USTB: United States Treasury Bond | |
FNMA: Federal National Mortgage Association | USTN: United States Treasury Note | |
GNMA: Government National Mortgage Association | GMAC: General Motors Acceptance Corp. |
Registered shares: A security whose owner has been recorded with its issuer or issuer’s registrar.
Abbreviations have been used throughout the portfolios to indicate amounts shown in currencies other than the U.S. dollar (USD):
AUD: Australian Dollar | GBP: British Pound | SEK: Swedish Krone | CHF: Swiss Franc | |||
CAD: Canadian Dollar | MXN: Mexican Peso | SGD: Singapore Dollar | ||||
DKK: Danish Krone | BRL: Brazilian Real | NZD: New Zealand Dollar | ||||
EUR: euro | NOK: Norwegian Krone | JPY: Japanese Yen |
25
Table of Contents
Statements of Assets and Liabilities
June 30, 2005 (unaudited)
Managers Fund | Managers Capital Appreciation Fund | Managers Small Company Fund | |||||||||
Assets: | |||||||||||
Investments at value (including securities on loan valued at $31,241,498, $23,908,921, $6,968,599, $34,377,020, $9,990,188, $94,553,797, $3,409,253, respectively) * | $ | 148,811,214 | $ | 121,994,429 | $ | 37,858,483 | |||||
Foreign currency** | — | — | — | ||||||||
Receivable for investments sold | — | 848,546 | 47,501 | ||||||||
Receivable for Fund shares sold | 159,043 | 301,040 | 41,788 | ||||||||
Receivable for open forward foreign currency contracts | — | — | — | ||||||||
Dividends, interest and other receivables | 124,950 | 60,426 | 11,257 | ||||||||
Prepaid expenses | 11,960 | 7,555 | 14,019 | ||||||||
Total assets | 149,107,167 | 123,211,996 | 37,973,048 | ||||||||
Liabilities: | |||||||||||
Payable for Fund shares repurchased | 192,141 | — | 87,469 | ||||||||
Payable upon return of securities loaned | 31,819,569 | 23,343,286 | 7,161,929 | ||||||||
Payable for investments purchased | — | 553,548 | — | ||||||||
Payable for open forward foreign currency contracts | — | — | — | ||||||||
Accrued expenses: | |||||||||||
Investment advisory and management fees | 71,817 | 65,738 | 22,170 | ||||||||
Administrative fees | 23,939 | 20,543 | 6,158 | ||||||||
Other | 112,665 | 137,995 | 24,472 | ||||||||
Total liabilities | 32,220,131 | 24,121,110 | 7,302,198 | ||||||||
Net Assets | $ | 116,887,036 | $ | 99,090,886 | $ | 30,670,850 | |||||
Shares outstanding | 3,841,967 | 3,821,891 | 2,996,240 | ||||||||
Net asset value, offering and redemption price per share | $ | 30.42 | $ | 25.93 | $ | 10.24 | |||||
Net Assets Represent: | |||||||||||
Paid-in capital | $ | 89,962,543 | $ | 248,549,117 | $ | 31,610,059 | |||||
Undistributed net investment income (loss) | 528,254 | (103,157 | ) | (131,725 | ) | ||||||
Accumulated net realized gain (loss) from investments, futures and foreign currency transactions | 6,849,666 | (157,981,561 | ) | (7,417,155 | ) | ||||||
Net unrealized appreciation of investments, futures and foreign currency contracts and translations | 19,546,573 | 8,626,487 | 6,609,671 | ||||||||
Net Assets | $ | 116,887,036 | $ | 99,090,886 | $ | 30,670,850 | |||||
* Investments at cost | $ | 129,264,641 | $ | 113,367,942 | $ | 31,248,811 | |||||
** Foreign currency at cost |
The accompanying notes are an integral part of these financial statements.
26
Table of Contents
Statements of Assets and Liabilities
June 30, 2005 (unaudited)
Managers Fund | Managers Fund | Managers Bond Fund | Managers Bond Fund | |||||||||||
Assets: | ||||||||||||||
Investments at value (including securities on loan valued at $31,241,498, $23,908,921, $6,968,599, $34,377,020, $9,990,188, $94,553,797, $3,409,253, respectively) * | $ | 239,887,962 | $ | 84,365,552 | $ | 381,377,770 | $ | 41,315,970 | ||||||
Foreign currency** | 1,479,918 | 1,888,806 | 4,763 | 5,280 | ||||||||||
Receivable for investments sold | 1,667,701 | 2,084,770 | — | 456,431 | ||||||||||
Receivable for Fund shares sold | 199,939 | 206,046 | 587,921 | 179,738 | ||||||||||
Receivable for open forward foreign currency contracts | 362,354 | — | — | 2,517,822 | ||||||||||
Dividends, interest and other receivables | 558,546 | 272,575 | 3,994,601 | 497,894 | ||||||||||
Prepaid expenses | 15,456 | 13,015 | 24,038 | 10,222 | ||||||||||
Total assets | 244,171,876 | 88,830,764 | 385,989,093 | 44,983,357 | ||||||||||
Liabilities: | ||||||||||||||
Payable for Fund shares repurchased | 273,441 | 86,323 | 439,121 | 14,328 | ||||||||||
Payable upon return of securities loaned | 35,990,692 | 10,280,769 | 43,688,765 | 2,977,802 | ||||||||||
Payable for investments purchased | 745,805 | 2,376,322 | — | 567,931 | ||||||||||
Payable for open forward foreign currency contracts | 360,499 | — | — | 2,475,288 | ||||||||||
Accrued expenses: | ||||||||||||||
Investment advisory and management fees | 153,666 | 70,290 | 163,754 | 21,196 | ||||||||||
Administrative fees | 42,685 | 15,280 | 68,580 | 6,292 | ||||||||||
Other | 406,838 | 90,169 | 96,470 | 49,761 | ||||||||||
Total liabilities | 37,973,626 | 12,919,153 | 44,456,690 | 6,112,598 | ||||||||||
Net Assets | $ | 206,198,250 | $ | 75,911,611 | $ | 341,532,403 | $ | 38,870,759 | ||||||
Shares outstanding | 4,510,380 | 4,415,096 | 13,956,895 | 1,795,032 | ||||||||||
Net asset value, offering and redemption price per share | $ | 45.72 | $ | 17.19 | $ | 24.47 | $ | 21.65 | ||||||
Net Assets Represent: | ||||||||||||||
Paid-in capital | $ | 289,819,848 | $ | 56,851,167 | $ | 331,101,008 | $ | 36,560,288 | ||||||
Undistributed net investment income (loss) | 1,756,909 | 465,632 | (409,333 | ) | 773,230 | |||||||||
Accumulated net realized gain (loss) from investments, futures and foreign currency transactions | (116,114,517 | ) | 4,296,006 | 3,035,395 | 750,506 | |||||||||
Net unrealized appreciation of investments, futures and foreign currency contracts and translations | 30,736,010 | 14,298,806 | 7,805,333 | 786,735 | ||||||||||
Net Assets | $ | 206,198,250 | $ | 75,911,611 | $ | 341,532,403 | $ | 38,870,759 | ||||||
* Investments at cost | $ | 209,175,119 | $ | 70,037,811 | $ | 373,574,577 | $ | 40,558,850 | ||||||
** Foreign currency at cost | 1,480,920 | 1,920,197 | 4,810 | 5,351 |
The accompanying notes are an integral part of these financial statements.
27
Table of Contents
For the six months ended June 30, 2005 (unaudited)
Managers Value Fund | Managers Capital Appreciation Fund | |||||||
Investment Income: | ||||||||
Dividend income | $ | 1,075,508 | $ | 514,204 | ||||
Interest income | 88,925 | — | ||||||
Foreign withholding tax | (11,981 | ) | (9,232 | ) | ||||
Securities lending fees | 11,892 | 9,804 | ||||||
Total investment income | 1,164,344 | 514,776 | ||||||
Expenses: | ||||||||
Investment management fees | 456,733 | 390,886 | ||||||
Administrative fees | 152,244 | 122,152 | ||||||
Transfer agent | 23,759 | 36,818 | ||||||
Professional fees | 22,566 | 19,483 | ||||||
Custodian | 20,615 | 20,692 | ||||||
Registration fees | 9,256 | 6,389 | ||||||
Trustees fees and expenses | 3,088 | 1,759 | ||||||
Miscellaneous | 12,075 | 11,021 | ||||||
Total expenses before offsets | 700,336 | 609,200 | ||||||
Expense (reimbursement)/recoupment | 27,401 | 22,668 | ||||||
Expense reductions | (7,330 | ) | (13,935 | ) | ||||
Net expenses | 720,407 | 617,933 | ||||||
Net investment income (loss) | 443,937 | (103,157 | ) | |||||
Net Realized and Unrealized Gain (Loss): | ||||||||
Net realized gain on investment transactions | 7,626,777 | 3,850,356 | ||||||
Net realized loss on futures contracts | — | — | ||||||
Net realized gain (loss) on foreign currency contracts and transactions | — | — | ||||||
Net unrealized depreciation of investments | (4,495,698 | ) | (6,039,451 | ) | ||||
Net unrealized appreciation of futures contracts | — | — | ||||||
Net unrealized appreciation (depreciation) of foreign currency contracts and translations | — | — | ||||||
Net realized and unrealized gain (loss) | 3,131,079 | (2,189,095 | ) | |||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 3,575,016 | $ | (2,292,252 | ) | |||
The accompanying notes are an integral part of these financial statements.
28
Table of Contents
Statements of Operations
For the six months ended June 30, 2005 (unaudited)
Managers Small Company Fund | Managers International Equity Fund | Managers Markets Equity Fund | Managers Bond Fund | Managers Bond Fund | ||||||||||||||||
Investment Income: | ||||||||||||||||||||
Dividend income | $ 60,957 | $ | 3,562,030 | $ | 1,087,549 | $ | 70,963 | $ | — | |||||||||||
Interest income | — | 52,956 | — | 6,186,046 | 650,377 | |||||||||||||||
Foreign withholding tax | (199 | ) | (362,571 | ) | (111,910 | ) | — | — | ||||||||||||
Securities lending fees | 6,117 | 102,192 | 16,623 | 42,744 | 4,972 | |||||||||||||||
Total investment income | 66,875 | 3,354,607 | 992,262 | 6,299,753 | 655,349 | |||||||||||||||
Expenses: | ||||||||||||||||||||
Investment management fees | 123,269 | 972,995 | 393,909 | 919,488 | 129,616 | |||||||||||||||
Administrative fees | 34,241 | 270,276 | 85,632 | 367,795 | 37,033 | |||||||||||||||
Transfer agent | 6,797 | 81,274 | 21,651 | 101,191 | 19,145 | |||||||||||||||
Professional fees | 12,161 | 23,449 | 18,376 | 29,546 | 25,826 | |||||||||||||||
Custodian | 11,829 | 102,196 | 37,058 | 32,240 | 15,220 | |||||||||||||||
Registration fees | 4,390 | 8,860 | 7,053 | 12,743 | 5,676 | |||||||||||||||
Trustees fees and expenses | 970 | 5,137 | 1,948 | 8,165 | 859 | |||||||||||||||
Miscellaneous | 1,743 | 50,437 | 39,033 | 27,312 | 2,637 | |||||||||||||||
Total expenses before offsets | 195,400 | 1,514,624 | 604,660 | 1,498,480 | 236,012 | |||||||||||||||
Expense (reimbursement)/recoupment | 3,200 | 141,842 | 23,774 | (41,959 | ) | (15,638 | ) | |||||||||||||
Expense reductions | — | (36,283 | ) | — | (46 | ) | — | |||||||||||||
Net expenses | 198,600 | 1,620,183 | 628,434 | 1,456,475 | 220,374 | |||||||||||||||
Net investment income (loss) | (131,725 | ) | 1,734,424 | 363,828 | 4,843,278 | 434,975 | ||||||||||||||
Net Realized and Unrealized Gain (Loss): | ||||||||||||||||||||
Net realized gain on investment transactions | 601,833 | 12,420,339 | 3,719,878 | 2,877,588 | 366,077 | |||||||||||||||
Net realized loss on futures contracts | — | (47,141 | ) | — | — | — | ||||||||||||||
Net realized gain (loss) on foreign currency contracts and transactions | — | 50,643 | (35,127 | ) | (133,951 | ) | 138,540 | |||||||||||||
Net unrealized depreciation of investments | (683,221 | ) | (20,690,032 | ) | (1,229,543 | ) | (3,424,009 | ) | (2,196,941 | ) | ||||||||||
Net unrealized appreciation of futures contracts | — | 1,108 | — | — | — | |||||||||||||||
Net unrealized appreciation (depreciation) of foreign currency contracts and translations | — | (60,345 | ) | (36,253 | ) | (6,523 | ) | 34,059 | ||||||||||||
Net realized and unrealized gain (loss) | (81,388 | ) | (8,325,428 | ) | 2,418,955 | (686,895 | ) | (1,658,265 | ) | |||||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | (213,113 | ) | $ | (6,591,004 | ) | $ | 2,782,783 | $ | 4,156,383 | $ | (1,223,290 | ) | |||||||
The accompanying notes are an integral part of these financial statements.
29
Table of Contents
Statements of Changes in Net Assets
For the six months ended June 30, 2005, (unaudited) and for the year ended December 31, 2004
Managers Value Fund | Managers Capital Appreciation Fund | |||||||||||||||
2005 | 2004 | 2005 | 2004 | |||||||||||||
Increase (Decrease) in Net Assets From Operations: | ||||||||||||||||
Net investment income (loss) | $ | 443,937 | $ | 676,312 | $ | (103,157 | ) | $ | (267,972 | ) | ||||||
Net realized gain on investments, futures and foreign currency transactions | 7,626,777 | 5,860,848 | 3,850,356 | 5,023,588 | ||||||||||||
Net unrealized appreciation (depreciation) of investments and foreign currency translations | (4,495,698 | ) | 7,766,982 | (6,039,451 | ) | 145,527 | ||||||||||
Net increase (decrease) in net assets resulting from operations | 3,575,016 | 14,304,142 | (2,292,252 | ) | 4,901,143 | |||||||||||
Distributions to Shareholders: | ||||||||||||||||
From net investment income | — | (600,552 | ) | — | — | |||||||||||
From net realized gain on investments | — | — | — | — | ||||||||||||
Total distributions to shareholders | — | (600,552 | ) | — | — | |||||||||||
From Capital Share Transactions: | ||||||||||||||||
Proceeds from sale of shares | 25,927,344 | 44,358,223 | 18,930,120 | 24,179,731 | ||||||||||||
Reinvestment of dividends and distributions | — | 583,933 | — | — | ||||||||||||
Cost of shares repurchased | (32,162,530 | ) | (39,818,512 | ) | (15,894,352 | ) | (41,636,068 | ) | ||||||||
Net increase (decrease) from capital share transactions | (6,235,186 | ) | 5,123,644 | 3,035,768 | (17,456,337 | ) | ||||||||||
Total increase (decrease) in net assets | (2,660,170 | ) | 18,827,234 | 743,516 | (12,555,194 | ) | ||||||||||
Net Assets: | ||||||||||||||||
Beginning of period | 119,547,206 | 100,719,972 | 98,347,370 | 110,902,564 | ||||||||||||
End of period | $ | 116,887,036 | $ | 119,547,206 | $ | 99,090,886 | $ | 98,347,370 | ||||||||
End of period undistributed net investment income (loss) | $ | 528,254 | $ | 84,317 | $ | (103,157 | ) | $ | — | |||||||
Share Transactions: | ||||||||||||||||
Sale of shares | 908,999 | 1,627,365 | 766,327 | 956,706 | ||||||||||||
Reinvested shares | — | 19,674 | — | — | ||||||||||||
Shares repurchased | (1,088,656 | ) | (1,463,608 | ) | (617,595 | ) | (1,638,915 | ) | ||||||||
Net increase (decrease) in shares | (179,657 | ) | 183,431 | 148,732 | (682,209 | ) | ||||||||||
The accompanying notes are an integral part of these financial statements.
30
Table of Contents
Statements of Changes in Net Assets
For the six months ended June 30, 2005, (unaudited) and for the year ended December 31, 2004
Managers Small Company Fund | Managers International Equity Fund | Managers Emerging Markets Equity Fund | ||||||||||||||||||||||
2005 | 2004 | 2005 | 2004 | 2005 | 2004 | |||||||||||||||||||
Increase (Decrease) in Net Assets From Operations: | ||||||||||||||||||||||||
Net investment income (loss) | $ | (131,725 | ) | $ | (226,293 | ) | $ | 1,734,424 | $ | 1,374,228 | $ | 363,828 | $ | 307,009 | ||||||||||
Net realized gain on investments, futures and foreign currency transactions | 601,833 | 1,060,845 | 12,423,841 | 33,967,766 | 3,684,751 | 5,418,097 | ||||||||||||||||||
Net unrealized appreciation (depreciation) of investments and foreign currency translations | (683,221 | ) | 2,135,788 | (20,749,269 | ) | (2,335,520 | ) | (1,265,796 | ) | 6,510,946 | ||||||||||||||
Net increase (decrease) in net assets resulting from operations | (213,113 | ) | 2,970,340 | (6,591,004 | ) | 33,006,474 | 2,782,783 | 12,236,052 | ||||||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||
From net investment income | — | — | — | (1,540,373 | ) | — | (225,163 | ) | ||||||||||||||||
From net realized gain on investments | — | — | — | — | — | (1,936,391 | ) | |||||||||||||||||
Total distributions to shareholders | — | — | — | (1,540,373 | ) | — | (2,161,554 | ) | ||||||||||||||||
From Capital Share Transactions: | ||||||||||||||||||||||||
Proceeds from sale of shares | 6,548,026 | 10,890,027 | 19,072,415 | 45,879,177 | 21,956,331 | 41,188,851 | ||||||||||||||||||
Reinvestment of dividends and distributions | — | — | 1,244,967 | — | 2,118,388 | |||||||||||||||||||
Cost of shares repurchased | (3,292,863 | ) | (4,981,576 | ) | (40,343,729 | ) | (111,140,448 | ) | (12,394,168 | ) | (26,542,734 | ) | ||||||||||||
Net increase (decrease) from capital share transactions | 3,255,163 | 5,908,451 | (21,271,314 | ) | (64,016,304 | ) | 9,562,163 | 16,764,505 | ||||||||||||||||
Total increase (decrease) in net assets | 3,042,050 | 8,878,791 | (27,862,318 | ) | (32,550,203 | ) | 12,344,946 | 26,839,003 | ||||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Beginning of period | 27,628,800 | 18,750,009 | 234,060,568 | 266,610,771 | 63,566,665 | 36,727,662 | ||||||||||||||||||
End of period | $ | 30,670,850 | $ | 27,628,800 | $ | 206,198,250 | $ | 234,060,568 | $ | 75,911,611 | $ | 63,566,665 | ||||||||||||
End of period undistributed net investment income (loss) | $ | (131,725 | ) | $ | — | $ | 1,756,909 | $ | 22,485 | $ | 465,632 | $ | 101,804 | |||||||||||
Share Transactions: | ||||||||||||||||||||||||
Sale of shares | 661,309 | 1,155,515 | 414,113 | 1,093,874 | 1,306,624 | 2,854,814 | ||||||||||||||||||
Reinvested shares | — | — | — | 26,483 | — | 130,443 | ||||||||||||||||||
Shares repurchased | (330,817 | ) | (530,122 | ) | (878,371 | ) | (2,628,151 | ) | (744,167 | ) | (1,902,280 | ) | ||||||||||||
Net increase (decrease) in shares | 330,492 | 625,393 | (464,258 | ) | (1,507,794 | ) | 562,457 | 1,082,977 | ||||||||||||||||
The accompanying notes are an integral part of these financial statements.
31
Table of Contents
Statements of Changes in Net Assets (continued)
For the six months ended June 30, 2005, (unaudited) and for the year ended December 31, 2004
Managers Bond Fund | Managers Global Bond Fund | |||||||||||||||
2005 | 2004 | 2005 | 2004 | |||||||||||||
Increase (Decrease) in Net Assets From Operations: | ||||||||||||||||
Net investment income | $ | 4,843,278 | $ | 7,869,572 | $ | 434,975 | $ | 889,798 | ||||||||
Net realized gain on investments, futures and foreign currency transactions | 2,743,637 | 2,905,771 | 504,617 | 2,509,405 | ||||||||||||
Net unrealized appreciation (depreciation) of investments and foreign currency translations | (3,430,532 | ) | 116,939 | (2,162,882 | ) | (394,129 | ) | |||||||||
Net increase (decrease) in net assets resulting from operations | 4,156,383 | 10,892,282 | (1,223,290 | ) | 3,005,074 | |||||||||||
Distributions to Shareholders: | ||||||||||||||||
From net investment income | (5,288,411 | ) | (9,201,004 | ) | — | (2,005,510 | ) | |||||||||
From net realized gain on investments | — | (1,786,138 | ) | — | (917,446 | ) | ||||||||||
Total distributions to shareholders | (5,288,411 | ) | (10,987,142 | ) | — | (2,922,956 | ) | |||||||||
From Capital Share Transactions: | ||||||||||||||||
Proceeds from sale of shares | 130,186,053 | 148,437,567 | 8,493,919 | 17,122,093 | ||||||||||||
Reinvestment of dividends and distributions | 4,906,703 | 10,270,433 | — | 2,901,332 | ||||||||||||
Cost of shares repurchased | (51,638,350 | ) | (79,044,208 | ) | (4,853,507 | ) | (15,959,002 | ) | ||||||||
Net increase from capital share transactions | 83,454,406 | 79,663,792 | 3,640,412 | 4,064,423 | ||||||||||||
Total increase in net assets | 82,322,378 | 79,568,932 | 2,417,122 | 4,146,541 | ||||||||||||
Net Assets: | ||||||||||||||||
Beginning of period | 259,210,025 | 179,641,093 | 36,453,637 | 32,307,096 | ||||||||||||
End of period | $ | 341,532,403 | $ | 259,210,025 | $ | 38,870,759 | $ | 36,453,637 | ||||||||
End of period undistributed net investment income (loss) | $ | (409,333 | ) | $ | 35,800 | $ | 773,230 | $ | 338,255 | |||||||
Share Transactions: | ||||||||||||||||
Sale of shares | 5,325,134 | 6,055,078 | 387,356 | 759,922 | ||||||||||||
Reinvested shares | 201,177 | 421,611 | — | 129,755 | ||||||||||||
Shares repurchased | (2,112,927 | ) | (3,242,568 | ) | (221,069 | ) | (716,810 | ) | ||||||||
Net increase in shares | 3,413,384 | 3,234,121 | 166,287 | 172,867 | ||||||||||||
The accompanying notes are an integral part of these financial statements.
32
Table of Contents
For a share outstanding throughout the six months ended June 30, 2005, (unaudited) and each year ended December 31,
Managers Value Fund | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 29.73 | $ | 26.24 | $ | 20.69 | $ | 27.45 | $ | 27.73 | $ | 27.50 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment income | 0.12 | 0.17 | 0.11 | 0.15 | 0.09 | 0.17 | ||||||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.57 | 3.47 | 5.56 | (6.65 | ) | 0.70 | 2.45 | |||||||||||||||||
Total from investment operations | 0.69 | 3.64 | 5.67 | (6.50 | ) | 0.79 | 2.62 | |||||||||||||||||
Less Distributions to Shareholders from: | ||||||||||||||||||||||||
Net investment income | — | (0.15 | ) | (0.12 | ) | (0.16 | ) | (0.08 | ) | (0.17 | ) | |||||||||||||
Net realized gain on investments | — | — | — | (0.10 | ) | (0.99 | ) | (2.22 | ) | |||||||||||||||
Total distributions to shareholders | — | (0.15 | ) | (0.12 | ) | (0.26 | ) | (1.07 | ) | (2.39 | ) | |||||||||||||
Net Asset Value, End of Period | $ | 30.42 | $ | 29.73 | $ | 26.24 | $ | 20.69 | $ | 27.45 | $ | 27.73 | ||||||||||||
Total Return1 | 2.32 | %2 | 13.87 | % | 27.39 | % | (23.79 | )% | 2.92 | % | 9.80 | % | ||||||||||||
Ratio of net expenses to average net assets 1 | 1.18 | %3 | 1.22 | % | 1.27 | % | 1.28 | % | 1.25 | % | 1.30 | % | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.15 | %3,5 | 1.38 | %5 | 1.42 | %5 | 1.35 | % | 1.35 | % | 1.38 | % | ||||||||||||
Ratio of net investment income to average net assets | 0.73 | %3 | 0.62 | % | 0.59 | % | 0.60 | % | 0.43 | % | 0.61 | % | ||||||||||||
Portfolio turnover | 26 | %2 | 39 | % | 40 | % | 53 | % | 147 | % | 153 | % | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 116,887 | $ | 119,547 | $ | 100,720 | $ | 48,001 | $ | 63,628 | $ | 57,300 | ||||||||||||
Managers Capital Appreciation Fund | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 26.77 | $ | 25.46 | $ | 20.36 | $ | 29.29 | $ | 42.79 | $ | 61.12 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment loss | (0.03 | ) | (0.07 | ) | (0.16 | ) | (0.28 | ) | (0.25 | ) | (0.42 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.81 | ) | 1.38 | 5.26 | (8.65 | ) | (13.25 | ) | (13.25 | ) | ||||||||||||||
Total from investment operations | (0.84 | ) | 1.31 | 5.10 | (8.93 | ) | (13.50 | ) | (13.67 | ) | ||||||||||||||
Less Distributions to Shareholders from: | ||||||||||||||||||||||||
Net realized gain on investments | — | — | — | — | — | (4.66 | ) | |||||||||||||||||
Net Asset Value, End of Period | $ | 25.93 | $ | 26.77 | $ | 25.46 | $ | 20.36 | $ | 29.29 | $ | 42.79 | ||||||||||||
Total Return 1 | (3.14 | )%2 | 5.14 | % | 25.05 | % | (30.49 | )% | (31.55 | )% | (22.20 | )% | ||||||||||||
Ratio of net expenses to average net assets 1 | 1.26 | %3 | 1.34 | % | 1.33 | % | 1.39 | % | 1.34 | % | 1.23 | % | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.25 | %3,5 | 1.47 | %5 | 1.52 | %5 | 1.43 | % | 1.40 | % | 1.26 | % | ||||||||||||
Ratio of net investment loss to average net assets | (0.21 | )%3 | (0.26 | )% | (0.67 | )% | (1.07 | )% | (0.75 | )% | (0.82 | )% | ||||||||||||
Portfolio turnover | 53 | %2 | 79 | % | 109 | % | 141 | % | 265 | % | 306 | % | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 99,091 | $ | 98,347 | $ | 110,903 | $ | 107,545 | $ | 186,876 | $ | 286,515 | ||||||||||||
33
Table of Contents
Financial Highlights
For a share outstanding throughout the six months ended June 30, 2005, (unaudited) and each year ended December 31,
Managers Small Company Fund | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000* | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 10.36 | $ | 9.19 | $ | 6.40 | $ | 8.16 | $ | 9.29 | $ | 10.00 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment loss | (0.04 | ) | (0.08 | ) | (0.09 | ) | (0.13 | ) | (0.07 | ) | (0.01 | ) | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.08 | ) | 1.25 | 2.88 | (1.63 | ) | (1.06 | ) | (0.70 | ) | ||||||||||||||
Total from investment operations | (0.12 | ) | 1.17 | 2.79 | (1.76 | ) | (1.13 | ) | (0.71 | ) | ||||||||||||||
Net Asset Value, End of Period | $ | 10.24 | $ | 10.36 | $ | 9.19 | $ | 6.40 | $ | 8.16 | $ | 9.29 | ||||||||||||
Total Return 1 | (1.16 | )%2 | 12.73 | % | 43.59 | % | (21.57 | )% | (12.16 | )% | (7.10 | )%2 | ||||||||||||
Ratio of net expenses to average net assets 1 | 1.45 | %3 | 1.45 | % | 1.45 | % | 1.40 | % | 1.30 | % | 1.30 | %3 | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.43 | %3,5 | 1.43 | %5 | 1.50 | % | 1.70 | % | 1.71 | % | 1.72 | %3 | ||||||||||||
Ratio of net investment loss to average net assets | (0.96 | )%3 | (1.05 | )% | (1.20 | )% | (1.17 | )% | (0.92 | )% | (0.45 | )%3 | ||||||||||||
Portfolio turnover | 10 | %2 | 18 | % | 48 | % | 134 | % | 95 | % | 55 | %2 | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 30,671 | $ | 27,629 | $ | 18,750 | $ | 12,610 | $ | 26,764 | $ | 25,705 | ||||||||||||
* Commencement of operations was June 19, 2000. |
| |||||||||||||||||||||||
Managers International Equity Fund | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 47.05 | $ | 41.13 | $ | 31.22 | $ | 37.61 | $ | 49.38 | $ | 58.71 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment income | 0.39 | 0.27 | 0.34 | 0.19 | 0.20 | 4 | 0.27 | |||||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.72 | ) | 5.96 | 10.04 | (6.48 | ) | (11.72 | )4 | (5.38 | ) | ||||||||||||||
Total from investment operations | (1.33 | ) | 6.23 | 10.38 | (6.29 | ) | (11.52 | ) | (5.11 | ) | ||||||||||||||
Less Distributions to Shareholders from: | ||||||||||||||||||||||||
Net investment income | — | (0.31 | ) | (0.47 | ) | (0.10 | ) | (0.25 | ) | (0.24 | ) | |||||||||||||
Net realized gain on investments | — | — | — | — | — | (3.98 | ) | |||||||||||||||||
Total distributions to shareholders | — | (0.31 | ) | (0.47 | ) | (0.10 | ) | (0.25 | ) | (4.22 | ) | |||||||||||||
Net Asset Value, End of Period | $ | 45.72 | $ | 47.05 | $ | 41.13 | $ | 31.22 | $ | 37.61 | $ | 49.38 | ||||||||||||
Total Return 1 | (2.85 | )%2 | 15.17 | % | 33.21 | % | (16.71 | )% | (23.35 | )% | (8.46 | )% | ||||||||||||
Ratio of net expenses to average net assets 1 | 1.50 | %3 | 1.62 | % | 1.72 | % | 1.54 | % | 1.45 | % | 1.41 | % | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.40 | %3,5 | 1.70 | %5 | 1.73 | % | 1.56 | % | 1.46 | % | 1.42 | % | ||||||||||||
Ratio of net investment income to average net assets | 1.60 | %3 | 0.57 | % | 0.70 | % | 0.54 | % | 0.46 | %4 | 0.42 | % | ||||||||||||
Portfolio turnover | 44 | %2 | 93 | % | 80 | % | 132 | % | 108 | % | 99 | % | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 206,198 | $ | 234,061 | $ | 266,611 | $ | 362,561 | $ | 560,602 | $ | 656,630 | ||||||||||||
34
Table of Contents
Financial Highlights
For a share outstanding throughout the six months ended June 30, 2005, (unaudited) and each year ended December 31,
Managers Emerging Markets Equity Fund | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 16.50 | $ | 13.26 | $ | 8.80 | $ | 9.56 | $ | 9.63 | $ | 14.67 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment income (loss) | 0.08 | 0.08 | 0.01 | 0.03 | (0.01 | ) | (0.04 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.61 | 3.74 | 4.50 | (0.79 | ) | (0.04 | ) | (3.90 | ) | |||||||||||||||
Total from investment operations | 0.69 | 3.82 | 4.51 | (0.76 | ) | (0.05 | ) | (3.94 | ) | |||||||||||||||
Less Distributions to Shareholders from: | ||||||||||||||||||||||||
Net investment income | — | (0.06 | ) | (0.05 | ) | — | — | — | ||||||||||||||||
Net realized gain on investments | — | (0.52 | ) | — | — | (0.02 | ) | (1.10 | ) | |||||||||||||||
Total distributions to shareholders | — | (0.58 | ) | (0.05 | ) | — | (0.02 | ) | (1.10 | ) | ||||||||||||||
Net Asset Value, End of Period | $ | 17.19 | $ | 16.50 | $ | 13.26 | $ | 8.80 | $ | 9.56 | $ | 9.63 | ||||||||||||
Total Return 1 | 4.18 | %2 | 28.85 | % | 51.20 | % | (7.95 | )% | (0.57 | )% | (26.69 | )% | ||||||||||||
Ratio of net expenses to average net assets 1 | 1.83 | %3 | 1.85 | % | 1.99 | % | 1.97 | % | 1.94 | % | 1.98 | % | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.77 | %3,5 | 1.87 | %5 | 1.97 | %5 | 2.18 | % | 2.36 | % | 2.48 | % | ||||||||||||
Ratio of net investment income (loss) to average net assets | 1.06 | %3 | 0.67 | % | 0.08 | % | 0.32 | % | (0.09 | )% | (0.34 | )% | ||||||||||||
Portfolio turnover | 19 | %2 | 58 | % | 79 | % | 68 | % | 69 | % | 40 | % | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 75,912 | $ | 63,567 | $ | 36,728 | $ | 22,211 | $ | 15,202 | $ | 12,390 | ||||||||||||
Managers Bond Fund | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 24.58 | $ | 24.58 | $ | 23.44 | $ | 22.32 | $ | 21.75 | $ | 21.45 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment income | 0.05 | 0.80 | 1.08 | 1.24 | 1.44 | 1.49 | ||||||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.08 | ) | 0.30 | 1.40 | 1.12 | 0.60 | 0.48 | |||||||||||||||||
Total from investment operations | (0.03 | ) | 1.10 | 2.48 | 2.36 | 2.04 | 1.97 | |||||||||||||||||
Less Distributions to Shareholders from: | ||||||||||||||||||||||||
Net investment income | (0.08 | ) | (0.93 | ) | (1.11 | ) | (1.24 | ) | (1.45 | ) | (1.50 | ) | ||||||||||||
Net realized gain on investments | — | (0.17 | ) | (0.23 | ) | — | (0.02 | ) | (0.17 | ) | ||||||||||||||
Total distributions to shareholders | (0.08 | ) | (1.10 | ) | (1.34 | ) | (1.24 | ) | (1.47 | ) | (1.67 | ) | ||||||||||||
Net Asset Value, End of Period | $ | 24.47 | $ | 24.58 | $ | 24.58 | $ | 23.44 | $ | 22.32 | $ | 21.75 | ||||||||||||
Total Return 1 | 1.28 | %2 | 5.14 | % | 10.77 | % | 10.98 | % | 9.64 | % | 9.44 | % | ||||||||||||
Ratio of net expenses to average net assets 1 | 0.99 | %3 | 0.99 | % | 0.99 | % | 1.00 | % | 1.18 | % | 1.19 | % | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.02 | %3,5 | 1.06 | %5 | 1.09 | %5 | 1.17 | % | 1.18 | % | 1.20 | % | ||||||||||||
Ratio of net investment income to average net assets | 3.29 | %3 | 3.65 | % | 4.50 | % | 5.55 | % | 6.45 | % | 6.91 | % | ||||||||||||
Portfolio turnover | 8 | %2 | 16 | % | 73 | % | 24 | % | 16 | % | 10 | % | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 341,532 | $ | 259,210 | $ | 179,641 | $ | 128,341 | $ | 66,817 | $ | 51,383 | ||||||||||||
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Table of Contents
Financial Highlights
For a share outstanding throughout the six months ended June 30, 2005, (unaudited) and each year ended December 31,
Managers Global Bond Fund | ||||||||||||||||||||||||
June 30, 2005 | 2004 | 2003 | 2002 | 2001 | 2000 | |||||||||||||||||||
Net Asset Value, Beginning of Period | $ | 22.38 | $ | 22.19 | $ | 20.58 | $ | 17.97 | $ | 18.98 | $ | 19.44 | ||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||
Net investment income | 0.22 | 0.65 | 0.80 | 0.81 | 0.57 | 4 | 0.72 | |||||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.95 | ) | 1.49 | 3.43 | 2.57 | (1.33 | )4 | (1.06 | ) | |||||||||||||||
Total from investment operations | (0.73 | ) | 2.14 | 4.23 | 3.38 | (0.76 | ) | (0.34 | ) | |||||||||||||||
Less Distributions to Shareholders from: | ||||||||||||||||||||||||
Net investment income | — | (1.34 | ) | (2.09 | ) | (0.55 | ) | — | (0.12 | ) | ||||||||||||||
Net realized gain on investments | — | (0.61 | ) | (0.53 | ) | (0.22 | ) | (0.25 | ) | — | ||||||||||||||
Total distributions to shareholders | — | (1.95 | ) | (2.62 | ) | (0.77 | ) | (0.25 | ) | (0.12 | ) | |||||||||||||
Net Asset Value, End of Period | $ | 21.65 | $ | 22.38 | $ | 22.19 | $ | 20.58 | $ | 17.97 | $ | 18.98 | ||||||||||||
Total Return 1 | (3.26 | )%2 | 9.62 | % | 20.69 | % | 18.85 | % | (4.10 | )% | (1.62 | )% | ||||||||||||
Ratio of net expenses to average net assets 1 | 1.19 | %3 | 1.29 | % | 1.68 | % | 1.55 | % | 1.45 | % | 1.47 | % | ||||||||||||
Ratio of total expenses to average net assets 1 | 1.28 | %3,5 | 1.49 | %5 | 1.68 | % | 1.56 | % | 1.46 | % | 1.50 | % | ||||||||||||
Ratio of net investment income to average net assets | 2.35 | %3 | 2.73 | % | 3.48 | % | 4.01 | % | 2.87 | %4 | 4.07 | % | ||||||||||||
Portfolio turnover | 32 | %2 | 130 | % | 152 | % | 220 | % | 244 | % | 176 | % | ||||||||||||
Net assets at end of period (000’s omitted) | $ | 38,871 | $ | 36,454 | $ | 32,307 | $ | 19,746 | $ | 19,879 | $ | 22,723 | ||||||||||||
The following notes should be read in conjunction with the Financial Highlights of the Funds presented on the preceding pages.
1 | See Note l(c) of “Notes to Financial Statements.” |
2 | Not Annualized. |
3 | Annualized. |
4 | Effective January 1, 2001, the Trust adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began amortizing premium and discount on all debt securities, as required. The effect of this change during the year ended December 31, 2001 on International Equity, Intermediate Bond and Global Bond was to decrease net investment income and increase net realized and unrealized gain (loss) per share by $0.01, $0.04 and $0.04, respectively. The effect of this change on the remaining Funds was not significant. Without this change the ratio of net investment income to average net assets for the year ended December 31, 2001 for International Equity and Global Bond would have been 0.46% and 3.08%, respectively. Per share data, ratios and supplemental data for prior periods have not been restated to reflect this change. |
5 | Excludes the impact of expense (reimbursement)/recoupment and expense offsets such as brokerage credits, but includes non-reimbursable expenses such as interest and taxes. (See Note 1c to the Notes to Financial Statements.) |
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Notes to Financial Statements (unaudited)
June 30, 2005
(1) Summary of Significant Accounting Policies
The Managers Funds (the “Trust”) is an open-end management investment company organized as a Massachusetts business trust and registered under the Investment Company Act of 1940, as amended (the “1940 Act”). Currently, the Trust is comprised of a number of investment series. Included in this report are the Managers Value Fund (“Value”), Managers Capital Appreciation Fund (“Capital Appreciation”), Managers Small Company Fund (“Small Company”), Managers International Equity Fund (“International Equity”), Managers Emerging Markets Equity Fund (“Emerging Markets Equity”), Managers Bond Fund (“Bond”) and Managers Global Bond Fund (“Global Bond”), collectively the “Funds.”
The Funds’ financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting periods. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements:
(a) Valuation of Investments
Equity securities traded on a domestic or international securities exchange are generally valued at the last quoted sale price, or, lacking any sales, at the last quoted bid price. Over-the-counter securities are valued at the Nasdaq Official Closing Price, if one is available. Lacking any sales, over-the-counter securities, are valued at the last quoted bid price. Under certain circumstances, the value of a Fund investment may be based on an evaluation of its fair value, pursuant to procedures established by and under the general supervision of the Board of Trustees of the Fund. A Fund may use the fair value of a portfolio security to calculate its NAV when, for example, (1) market quotations are not readily available because a portfolio security is not traded in a public market or the principal market in which the security trades is closed, (2) trading in a portfolio security is suspended and not resumed prior to the time as of which the Fund calculates its NAV, (3) where a significant event affecting the value of a portfolio security is determined to have occurred between the time of the market quotation provided for a portfolio security and the time as of which the Fund calculates its NAV, (4) a security’s price has remained unchanged over an extended period of time (often referred to as a “stale price”), or (5) the Investment Manager determines that a market quotation is inaccurate. The Manager monitors intervening events that may affect the value of securities held in each Fund’s portfolio and, in accordance with procedures adopted by the Funds’ Trustees, will adjust the prices of securities traded in foreign markets, as appropriate, to reflect the impact of events occurring subsequent to the close of such markets but prior to the time each Fund’s NAV is calculated. Fixed-income securities are valued based on valuations furnished by independent pricing services that utilize matrix systems, which reflect such factors as security prices, yields, maturities and ratings, and are supplemented by dealer and exchange quotations. Short-term investments having a remaining maturity of 60 days or less are valued at amortized cost, which approximates market value. Investments in other regulated investment companies are valued at their end of day net asset value per share except iShares or other ETF’s, which are valued the same as equity securities. Securities (including derivatives) for which market quotations are not readily available are valued at fair value, as determined in good faith, and pursuant to procedures adopted by the Board of Trustees of the Trust.
Investments in certain mortgage-backed, stripped mortgage-backed, preferred stocks, convertible securities and other debt securities not traded on an organized market, are valued on the basis of valuations provided by dealers or by a pricing service which uses information with respect to transactions in such securities, various relationships between securities and yield to maturity in determining value.
(b) Security Transactions
Security transactions are accounted for as of the trade date. Realized gains and losses on securities sold are determined on the basis of identified cost. The Funds had certain portfolio trades directed to a broker under a brokerage recapture program. For the six months ended June 30, 2005, under these arrangements the total amount by which the cost of the Funds’ securities were reduced or proceeds on sales increased were as follows: Value - $11,431; Capital Appreciation - $52,088; and International Equity - $23,134.
(c) Investment Income and Expenses
Dividend income is recorded on the ex-dividend date except certain dividends from foreign securities where the ex-dividend date may have passed. These dividends are recorded as soon as the Trust is informed of the ex-dividend date. Dividend income on foreign securities is recorded net of any withholding tax. Interest income, which includes amortization of premium and accretion of discount on debt securities, is accrued as earned. Non-cash dividends included in dividend income, if any, are reported at the fair market value of the securities received. Other income and expenses are recorded on an accrual basis. Expenses that cannot be directly attributed to a fund are apportioned among the Funds in the Trust and in some cases other affiliated funds based upon their relative average net assets or number of shareholders.
The following Funds had certain portfolio trades directed to various brokers who paid a portion of such Fund’s expenses. For the six months ended June 30, 2005, under these arrangements the amount by which the Funds’ expenses were reduced and the impact on the expense ratios were as follows: Value -$7,330 or 0.01%; Capital Appreciation – $13,837 or 0.03%; and International Equity - $36,214 or 0.03%.
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Notes to Financial Statements (continued)
In addition, each of the Funds has a “balance credit” arrangement with The Bank of New York (“BNY”), the Funds’ custodian, whereby each Fund is credited with an interest factor equal to 1% below the effective 90-day T-Bill rate for account balances left uninvested overnight. These credits serve to reduce custody expenses that would otherwise be charged to each Fund. For the six months ended June 30, 2005, the custodian expense was reduced as follows: Capital Appreciation – $98; International Equity - $69; and Bond - $46.
Effective May 1, 2004, Managers Investment Group LLC (formerly The Managers Funds LLC) (the “Investment Manager”), a subsidiary of Affiliated Managers Group, Inc. (“AMG”) and the Investment Manager for the Funds, has contractually agreed, through at least May 1, 2006, to waive fees and pay or reimburse expenses of Small Company, Bond and Global Bond to the extent that the total annual operating expenses (exclusive of brokerage, interest, taxes and extraordinary expenses) of the Fund exceed 1.45%, 0.99% and 1.19%, respectively, of each Fund’s average daily net assets. The Investment Manager has also contractually agreed to waive fees on Value, Capital Appreciation, International Equity and Emerging Markets Equity to the extent that the total annual operating expenses (exclusive of brokerage, interest, taxes and extraordinary expenses) of the Fund exceed 1.19%, 1.29%, 1.55% and 1.79%, respectively, of each Fund’s average daily net assets, provided that the amount of fees waived, paid or reimbursed does not exceed 0.25% per annum of each Fund’s average daily net assets.
Each Fund may be obligated to repay the Investment Manager such amounts waived, paid or reimbursed in future years provided that the repayment occurs within three (3) years after the waiver or reimbursement and that such repayment would not cause the Fund’s expenses in any such year to exceed the previously stated percentages of that Fund’s average daily net assets. For the six months ended June 30, 2005, the following Funds made such repayments to the Investment Manager in the following amounts: Value - $27,401; Capital Appreciation - $22,668; Small Company - $3,200; International Equity - $141,842; and Emerging Markets Equity - $23,774. At June 30, 2005, the cumulative amount of reimbursement by the Manager subject to repayment for Value, Capital Appreciation, Small Company, Bond and Global Bond equaled $122,782, $91,196, $29,174, $493,453 and $83,737, respectively.
Total returns and net investment income for the Funds would have been lower had certain expenses not been offset.
(d) Dividends and Distributions
Dividends resulting from net investment income, if any, normally will be declared and paid annually for Global Bond and the Equity Funds. Dividends resulting from net investment income, if any, normally will be declared and paid monthly for Bond. Distributions of capital gains, if any, will be made on an annual basis and when required for Federal excise tax purposes. Income and capital gain distributions are determined in accordance with Federal income tax regulations, which may differ from generally accepted accounting principles. These differences are primarily due to differing treatments for losses deferred due to wash sales, equalization accounting for tax purposes, foreign currency and market discount transactions. Permanent book and tax basis differences, if any, relating to shareholder distributions will result in reclassifications to paid-in capital.
(e) Federal Taxes
Each Fund intends to comply with the requirements under Subchapter M of the Internal Revenue Code of 1986, as amended, to distribute substantially all of its taxable income and gains to its shareholders and to meet certain diversification and income requirements with respect to investment companies. Therefore, no provision for Federal income or excise tax is included in the accompanying financial statements.
Additionally, based on the Fund’s understanding of the tax rules and rates related to income, gains and transactions for the foreign jurisdictions in which it invests, the Fund will provide for foreign taxes, and where appropriate, deferred foreign taxes.
(f) Capital Loss Carryovers
As of June 30, 2005, the following Funds had accumulated net realized capital loss carryovers from securities transactions for Federal income tax purposes as shown in the following chart. These amounts may be used to offset realized capital gains, if any, through the expiration dates listed.
Fund | Capital Loss Carryover Amount | Expires December 31, | |||
Capital Appreciation | $ | 117,690,624 30,988,593 12,899,489 | 2009 2010 2011 | ||
Small Company | | 6,244,667 1,700,278 | 2009 2010 | ||
International Equity | | 19,754,298 92,266,533 16,171,901 | 2009 2010 2011 |
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Notes to Financial Statements (continued)
(g) Capital Stock
The Trust’s Declaration of Trust authorizes for each series the issuance of an unlimited number of shares of beneficial interest, without par value. Each Fund records sales and repurchases of its capital stock on the trade date. Dividends and distributions to shareholders are recorded on the ex-dividend date.
At June 30, 2005, certain unaffiliated shareholders, specifically omnibus accounts, individually held greater than 10% of the outstanding shares of the following Funds: Value – one owns 19%; Capital Appreciation - one owns 15%; International Equity - three own 37%; Emerging Markets Equity – two own 51%; Bond - two own 35%.
(h) Repurchase Agreements
Each Fund may enter into repurchase agreements provided that the value of the underlying collateral, including accrued interest, will be equal to or exceed the value of the repurchase agreement during the term of the agreement. The underlying collateral for all repurchase agreements is held in safekeeping by the Fund’s custodian or at the Federal Reserve Bank.
If the seller defaults and the value of the collateral declines, or if bankruptcy proceedings commence with respect to the seller of the security, realization of the collateral by the Fund may be delayed or limited.
(i) Foreign Currency Translation
The books and records of the Funds are maintained in U.S. dollars. The value of investments, assets and liabilities denominated in currencies other than U.S. dollars are translated into U.S. dollars based upon current foreign exchange rates. Purchases and sales of foreign investments, income and expenses are converted into U.S. dollars based on currency exchange rates prevailing on the respective dates of such transactions. Net realized and unrealized gain (loss) on foreign currency transactions represent: (1) foreign exchange gains and losses from the sale and holdings of foreign currencies; (2) gains and losses between trade date and settlement date on investment securities transactions and forward foreign currency exchange contracts; and (3) gains and losses from the difference between amounts of interest and dividends recorded and the amounts actually received.
In addition, the Funds do not isolate the net realized and unrealized gain or loss resulting from changes in exchange rates from the fluctuations resulting from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.
(2) Agreements and Transactions with Affiliates
The Trust has entered into an Investment Management Agreement under which the Investment Manager provides or oversees investment management services to the Funds. The Investment Manager selects subadvisors for each Fund (subject to Trustee approval), allocates assets among subadvisors and monitors the subadvisors’ investment programs and results. Each Fund’s investment portfolio is managed by portfolio managers who serve pursuant to Subadvisory Agreements with the Investment Manager.
Investment management fees are paid directly by each Fund to the Investment Manager based on average daily net assets. The annual investment management fee rates, as a percentage of average daily net assets for the six months ended June 30, 2005, were as follows:
Fund | Investment Management Fee | ||
Value | 0.75 | % | |
Capital Appreciation | 0.80 | % | |
Small Company | 0.90 | % | |
International Equity | 0.90 | % | |
Emerging Markets Equity | 1.15 | % | |
Bond | 0.625 | % | |
Global Bond | 0.70 | % |
The Trust has entered into an Administration and Shareholder Servicing Agreement (“Administration Agreement”) under which Managers Investment Group LLC serves as each Fund’s administrator (the “Administrator”) and is responsible for all aspects of managing the Funds’ operations, including administration and shareholder services to each Fund, its shareholders, and certain institutions, such as bank trust departments, broker-dealers and registered investment advisers, that advise or act as an intermediary with the Funds’ shareholders. Under the terms of the Administration Agreement, each of the Funds, except Global Bond, pay a fee to the Administrator at the rate of 0.25% per annum of the Fund’s average daily net assets. Global Bond pays a fee to the Administrator at the rate of 0.20% per annum of the Fund’s average daily net assets.
The aggregate annual retainer paid to each Independent Trustee for all Trusts in the fund is $52,000, plus $2,000 for each meeting attended. The Trustees’ fees and expenses are allocated amongst all of the Funds for which Managers Investment Group LLC serves as the Advisor based on the relative net assets of such Funds. The Independent Chairman of the Trust receives an additional payment of $5,000 per year. The “Trustee fees and expenses” shown in the financial statements represents the Fund’s allocated portion of the total fees and expenses paid by the Fund and other affiliated funds in the Trust and in the complex.
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Table of Contents
Notes to Financial Statements (continued)
The Funds are distributed by Managers Distributors, Inc. (the “Distributor”), a wholly-owned subsidiary of Managers Investment Group LLC. Certain Trustees and Officers of the Funds are Officers and/or Directors of the Investment Manager, AMG and/or the Distributor. The Distributor serves as the principal underwriter for each Fund. The Distributor is a registered broker-dealer and member of the National Association of Securities Dealers, Inc. (“NASD”). Shares of each Fund will be continuously offered and will be sold by brokers, dealers or other financial intermediaries who have executed selling agreements with the Distributor. The Distributor bears all the expenses of providing services pursuant to an Underwriting Agreement, including the payment of the expenses relating to the distribution of Prospectuses for sales purposes and any advertising or sales literature.
(3) Purchases and Sales of Securities
Purchases and sales of securities, excluding short-term securities, for the six months ended June 30, 2005, were as follows:
Long-Term Securities | U.S. Government Securities | |||||||||||
Fund | Purchases | Sales | Purchases | Sales | ||||||||
Value | $ | 31,284,142 | $ | 36,998,498 | N/A | N/A | ||||||
Capital Appreciation | 51,051,969 | 51,787,755 | N/A | N/A | ||||||||
Small Company | 3,147,853 | 2,619,657 | N/A | N/A | ||||||||
International Equity | 94,072,690 | 114,536,642 | N/A | N/A | ||||||||
Emerging Markets Equity | 21,064,866 | 12,893,901 | N/A | N/A | ||||||||
Bond | 23,111,773 | 20,194,732 | $ | 52,141,873 | $ | 2,656,303 | ||||||
Global Bond | 13,431,700 | 7,768,358 | 2,035,891 | 3,635,135 |
(4) Portfolio Securities Loaned
The Funds may participate in a securities lending program offered by BNY providing for the lending of equities, corporate bonds and government securities to qualified brokers. Collateral on all securities loaned is accepted in cash and/or government securities. Collateral is maintained at a minimum level of 102% of the market value, plus interest, if applicable, of investments on loan. Collateral received in the form of cash is invested temporarily in institutional money market funds or other short-term investments by BNY. Earnings of such temporary cash investments are divided between BNY, as a fee for its services under the program, and the Fund loaning the security, according to agreed-upon rates.
(5) Commitments and Contingencies
In the normal course of business, the Funds may enter into contracts and agreements that contain a variety of representations and warranties, which provide general indemnifications. The maximum exposure to the Funds under these arrangements is unknown, as this would involve future claims that may be against the Funds that have not yet occurred. However, based on experience, the Funds expect the risks of loss to be remote.
(6) Risks Associated with Collateralized Mortgage Obligations (“CMOs”)
The net asset value of Funds may be sensitive to interest rate fluctuations because the Funds may hold several instruments, including CMOs and other derivatives, whose values can be significantly impacted by interest rate movements. CMOs are obligations collateralized by a portfolio of mortgages or mortgage-related securities. Payments of principal and interest on the mortgage are passed through to the holder of the CMOs on the same schedule as they are received, although certain classes of CMOs have priority over others with respect to the receipt of prepayments on the mortgages.
Therefore, the investment in CMOs may be subject to a greater or lesser risk of prepayment than other types of mortgage-related securities. CMOs may have a fixed or variable rate of interest.
(7) Forward Commitments
Certain transactions, such as futures and forward transactions, dollar roll agreements, or purchases of when-issued or delayed delivery securities may have a similar effect on a Fund’s net asset value as if the Fund had created a degree of leverage in its portfolio. However, if a Fund enters into such a transaction, the Fund will establish a segregated account with its custodian in which it will maintain cash, U.S. government securities or other liquid securities equal in value to its obligations in respect to such transaction. Securities and other assets held in the segregated account may not be sold while the transaction is outstanding, unless other suitable assets are substituted.
(8) Forward Foreign Currency Contracts
International Equity, Emerging Markets Equity, Bond and Global Bond invest in forward foreign currency exchange contracts to manage currency exposure. These investments may involve greater market risk than the amounts disclosed in the Funds’ financial statements.
A forward foreign currency exchange contract is an agreement between a Fund and another party to buy or sell a currency at a set price at a future date. The market value of the contract will fluctuate with changes in currency exchange rates. The contract is marked-to-market daily, and the change in market value is recorded as an unrealized gain or loss. Gain or loss on the purchase or sale of contracts having the same settlement date, amount and counter party is realized on the date of offset, otherwise gain or loss is realized on settlement date.
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Notes to Financial Statements (continued)
The Funds, except Value, Capital Appreciation, and Small Company, may invest in non-U.S. dollar denominated instruments subject to limitations, and enter into forward foreign currency exchange contracts to facilitate transactions in foreign securities and to protect against a possible loss resulting from an adverse change in the relationship between the U.S. dollar and such foreign currency. Risks may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar.
Open forward foreign currency exchange contracts (in U.S. Dollars) at June 30, 2005 were as follows:
Foreign Currency | Settlement Date | Current Value (Receivable Amount) | Contract Value (Payable Amount) | Unrealized Gain/Loss | ||||||||||||
International Equity | ||||||||||||||||
Canadian Dollar | Short | 07/05/05 | $ | (109,836 | ) | $ | (109,893 | ) | $ | (57 | ) | |||||
Swiss Franc | Long | 07/01/05 | 148,152 | 148,025 | (127 | ) | ||||||||||
euro-dollar Contracts | Short | 07/05/05 | (198,293 | ) | (198,437 | ) | (144 | ) | ||||||||
euro-dollar Contracts | Long | 07/01/05 | 24,759 | 24,841 | 82 | |||||||||||
Pound Sterling | Short | 07/05/05 | (227,136 | ) | (225,035 | ) | 2,101 | |||||||||
Total | $ | (362,354 | ) | $ | (360,499 | ) | $ | 1,855 | ||||||||
Global Bond | ||||||||||||||||
euro-dollar Contracts | Short | 07/05/05 | $ | (1,644,373 | ) | $ | (1,616,217 | ) | $ | 28,156 | ||||||
euro-dollar Contracts | Short | 09/08/05 | (458,555 | ) | (459,488 | ) | (933 | ) | ||||||||
euro-dollar Contracts | Long | 07/06/05 | 59,126 | 59,212 | 86 | |||||||||||
euro-dollar Contracts | Long | 09/08/05 | 454,260 | 455,225 | 965 | |||||||||||
Australian Dollar | Short | 08/31/05 | (1,067,492 | ) | (1,061,155 | ) | 6,337 | |||||||||
Japanese Yen | Long | 07/06/05 | 190,778 | 191,093 | 315 | |||||||||||
New Zealand Dollar | Short | 08/12/05 | (170,258 | ) | (162,802 | ) | 7,456 | |||||||||
Swedish Krona | Long | 07/06/05 | 118,692 | 118,844 | 152 | |||||||||||
Total | $ | (2,517,822 | ) | $ | (2,475,288 | ) | $ | 42,534 | ||||||||
(9) Futures Contracts Held or Issued for Purposes other than Trading
International Equity uses Equity Index futures contracts to a limited extent, with the objective of maintaining exposure to equity stock markets while maintaining liquidity. The Fund may purchase or sell futures contracts to achieve a desired level of investment, whether to accommodate portfolio turnover or cash flows from capital shares transactions. There are certain risks associated with futures contracts. Prices may not move as expected or a Fund may not be able to close out the contract when it desires to do so, resulting in losses.
Futures are valued at their quoted daily settlement prices. The aggregate principal amounts of the contracts are not recorded in the financial statements. Fluctuations in the value of the contracts are recorded in the Statement of Assets as an asset (liability) and in the Statement of Operations as unrealized appreciation (depreciation) until the contracts are closed, when they are recorded as realized gains (losses) on futures or forward currency contracts. The Fund had the following open futures contracts as of June 30, 2005: Long - 3-month Eurodollar, 15 contracts, expiring September 2005 with an unrealized gain of $9,604.
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Annual Renewal of Investment Advisory Agreements (unaudited)
On June 3, 2005, the Board of Trustees, including a majority of the Trustees that are not “interested persons” of the Trust (the “Independent Trustees”), approved the Investment Management Agreement with Managers Investment Group LLC (the “Investment Manager”) for each of the Funds identified below and the Subadvisory Agreement for each of the Subadvisors except Lazard, which Subadvisory Agreement had been previously approved by the Board of Trustees in March 2005. The Independent Trustees were separately represented by independent counsel in connection with their consideration of the approval of these agreements. In considering the Investment Management and Subadvisory Agreements, the Trustees reviewed a variety of materials relating to each Fund, the Investment Manager and each Subadvisor, including comparative performance, fee and expense information for an appropriate peer group of similar mutual funds (each, a “Peer Group”), performance information for relevant benchmark indices (each, a “Fund Benchmark”) and other information regarding the nature, extent and quality of services provided by the Investment Manager and the Subadvisors under their respective agreements. The Trustees also took into account performance, fee and expense information regarding each Fund provided to them on a quarterly basis throughout the year. Prior to voting, the Independent Trustees: (a) reviewed the foregoing information with their independent legal counsel and with management; (b) received materials from their independent legal counsel discussing the legal standards applicable to their consideration of the Investment Management Agreement and the Subadvisory Agreements; and (c) met with their independent legal counsel in private sessions at which no representatives of management were present.
Nature, extent and quality of services. In considering the nature, extent and quality of the services provided by the Investment Manager, the Trustees reviewed information relating to the Investment Manager’s operations and personnel. Among other things, the Investment Manager provided financial information, biographical information on its supervisory and professional staff and descriptions of its organizational and management structure. The Trustees also took into account information provided periodically throughout the previous year by the Investment Manager relating to the performance of its duties with respect to the Funds and the Trustees’ familiarity with the Investment Manager’s management through Board meetings, discussions and reports. In the course of their deliberations regarding the Investment Management Agreement, the Trustees evaluated, among other things: (a) the quality of the search, selection and monitoring services performed by the Investment Manager in overseeing the portfolio management responsibilities of the Subadvisors; (b) the Investment Manager’s ability to supervise each of the Fund’s other service providers; and (c) the Investment Manager’s compliance programs. The Trustees also took into account the financial condition of the Investment Manager with respect to its ability to provide the services required under the Investment Management Agreement and to maintain contractual expense limitations for the Funds.
For each Fund, the Trustees also reviewed information relating to each Subadvisor’s operations, personnel, and the investment philosophy, strategies and techniques (for each Subadvisor, its “Investment Strategy”) used in managing the Fund or the portion of the Fund for which the Subadvisor has portfolio management responsibility. Among other things, the Trustees reviewed biographical information on portfolio management and other professional staff, information regarding each Subadvisor’s organizational and management structure and each Subadvisor’s brokerage policies and practices. The Trustees considered specific information provided regarding the experience of the individual or individuals at each Subadvisor with portfolio management responsibility for the portion of the Fund managed by the Subadvisor, including the information set forth in the Fund’s prospectus. With respect to those Funds managed with multiple Subadvisors, the Trustees also noted information provided by the Investment Manager regarding the manner in which each Subadvisor’s Investment Strategy complements those utilized by the Fund’s other Subadvisors. In the course of their deliberations, the Trustees evaluated, among other things: (a) the services rendered by each Subadvisor in the past; (b) the qualifications and experience of the Subadvisor’s personnel; and (c) the Subadvisor’s compliance programs. The Trustees also took into account the financial condition of the Subadvisor with respect to its ability to provide the services required under the Subadvisory Agreement and, with respect to those Funds for which the Investment Manager has undertaken to implement expense limitations, the Subadvisor’s willingness to participate in such undertaking by waiving all or a portion of the Subadvisor’s fees.
Subadvisor Performance. As noted above, the Board considered each Fund’s performance during relevant time periods as compared to the Fund’s Peer Group and noted that the Board reviews on a quarterly basis detailed information about the Fund’s performance results, portfolio composition and Investment Strategies, including with respect to the portion of the Fund managed by each Subadvisor. The Board noted the Investment Manager’s expertise and resources in monitoring the performance, investment style and risk adjusted performance of each Subadvisor. The Board also noted each Subadvisor’s long-term performance record with respect to the Fund. The Board was mindful of the Investment Manager’s focus on each Subadvisor’s performance with respect to the Fund and the explanations of management regarding the factors that contributed to the short-term performance of the Fund.
Advisory Fees and Profitability. In considering the reasonableness of the advisory fee charged by the Investment Manager for managing each Fund, the Trustees noted that the Investment Manager, and not the Fund, is responsible for paying the fees charged by the Fund’s Subadvisors and, therefore, that the fees paid to the Investment Manager cover the reasonable cost of
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Annual Renewal of Investment Advisory Agreements (continued)
providing portfolio management services as well as the reasonable cost of providing search, selection and monitoring services in operating a “manager-of-managers” complex of mutual funds. The Trustees concluded that, in light of the additional high quality supervisory services provided by the Investment Manager and the fact that the subadvisory fees are paid out of the advisory fee, the advisory fee payable by each Fund to the Investment Manager can reasonably be expected to exceed the median advisory fee for the Peer Group, which consists mostly of funds that do not operate with a manager-of-managers structure. In this regard, the Trustees also considered the fact that the total expense ratio of most Funds is below the average of their Peer Groups.
In considering the reasonableness of the advisory fee payable to the Investment Manager, the Trustees also reviewed information provided by the Investment Manager setting forth all revenues and other benefits, both direct and indirect, received by the Investment Manager and its affiliates attributable to managing each Fund and all Funds as a group, the cost of providing such services and the resulting profitability to the Investment Manager and its affiliates from these relationships. The Trustees also noted the current and potential asset levels of each Fund and the willingness of the Investment Manager to waive fees and pay expenses for certain of the Funds from time to time as a means of limiting the total expenses of the smaller Funds. In this regard, the Trustees noted that, unlike the typical mutual fund that is managed by a single investment adviser, the Funds operate in a manager-of-managers structure and, as a Fund grows in size, it is common practice for the Investment Manager to recommend the selection of an additional Subadvisor to manage a portion of the Fund’s portfolio. The Trustees also noted that the subadvisory fees are paid by the Investment Manager out of its advisory fee. The Trustees further noted that, because of this practice, the Investment Manager’s oversight and supervisory responsibilities with respect to the Funds can be expected to increase with the size of the Funds. Based on the foregoing, the Trustees concluded that the Investment Manager is not realizing material benefits from economies of scale that would warrant adjustments to the advisory fees for any Fund at this time. With respect to economies of scale, the Trustees also noted that as a Fund’s assets increase over time, the Fund may realize other economies of scale to the extent that the increase in assets is proportionally greater than the increase in certain other expenses.
Subadvisory Fees and Profitability. In considering the reasonableness of the fee payable by the Investment Manager to each Sub-advisor (other than Essex, which is an affiliate of the Investment Manager), the Trustees relied on the ability of the Investment Manager to negotiate the terms of the Subadvisory Agreement at arm’s length as part of the manager-of-managers structure, noting that the Subadvisor is not affiliated with the Investment Manager. In addition, the Trustees noted that the subadvisory fees are paid by the Investment Manager out of its advisory fee. Accordingly, the cost of services to be provided by the Subadvisor and the profitability to the Subadvisor of its relationship with the Fund were not material factors in the Trustees’ deliberations. For similar reasons, and based on the current size of the portion of the Fund managed by the Subadvisor, the Trustees concluded that any economies of scale being realized by the Subadvisor was not a material factor in the Trustees’ deliberations at this time.
In considering the reasonableness of the fee payable by the Investment Manager to Essex, which is a Subadvisor of Managers Capital Appreciation Fund, the Trustees noted that Essex is an affiliate of the Investment Manager. The Trustees also noted that the fee payable by the Investment Manager to Essex under its Subadvisory Agreement is identical to the fee payable to the Fund’s other Subadvisor, which is not an affiliate of the Investment Manager. The Trustees also noted that the subadvisory fee is paid by the Investment Manager out of the advisory fee. Accordingly, the cost of services to be provided by Essex and the profitability to Essex of its relationship with the Fund were not material factors in the Trustees’ deliberations. For similar reasons, and based on the current size of the portion of the Fund managed by the Subadvisor, the Trustees concluded that any economies of scale being realized by Essex was not a material factor in the Trustees’ deliberations at this time.
In addition to the foregoing, the Trustees considered the specific factors and related conclusions set forth below with respect to each Fund.
Managers Capital Appreciation Fund
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was below, below, below and above, respectively, the median performance of the Peer Group and that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was below the performance for all periods of the Fund Benchmark, which is the S&P 500 Index. The Trustees took into account management’s discussion of the reasons for the Fund’s performance, including that the market environment in recent years has been particularly difficult in light of the Fund’s focus on smaller capitalization growth companies. In addition, the Trustees noted that the Fund’s longer-term performance has been satisfactory and that (a) the Investment Manager had taken action in 2003 to improve the performance of the Fund by changing one of the Fund’s Subadvisors and (b) one of the Fund’s Subadvisors had undertaken organizational and personnel changes in 2005 designed to improve performance. The Trustees concluded that appropriate action is being taken to address the Fund’s performance.
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Advisory Fees. The Trustees noted that the Fund’s advisory fee and total expenses (net of applicable expense waivers/ reimbursements) as of March 31, 2005 were higher than the average and lower than the average, respectively, for the Peer Group and that the Investment Manager has contractually agreed through May 1, 2006 to limit the Fund’s net annual operating expenses to 1.29%, provided that the amount waived may not exceed 0.25%. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisors, the foregoing expense limitation and the considerations noted above with respect to the Subadvisors and the Investment Manager, the Fund’s advisory fees are reasonable.
Managers Value Fund
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was above, below, above and above, respectively, the median performance of the Peer Group and the performance of the Fund Benchmark, which is the S&P 500 Index. The Trustees concluded that the Fund’s performance has been satisfactory in light of all factors considered.
Advisory Fees. The Trustees noted that the Fund’s advisory fee and total expenses (net of applicable expense waivers/ reimbursements) as of March 31, 2005 were higher than the average and lower than the average, respectively, for the Peer Group and that the Investment Manager has contractually agreed through May 1, 2006 to limit the Fund’s net annual operating expenses to 1.19%, provided that the amount waived may not exceed 0.25%. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisors, the Fund’s performance, the foregoing expense limitation and the considerations noted above with respect to the Subadvisors and the Investment Manager, the Fund’s advisory fees are reasonable.
Managers Bond Fund
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was above the median performance of the Peer Group and the performance of the Fund Benchmark, which is the Lehman Brothers Government/Credit Index, for all periods. The Trustees concluded that the Fund’s performance has been satisfactory.
Advisory Fees. The Trustees noted that the Fund’s advisory fee and total expenses (net of applicable expense waivers/ reimbursements) as of March 31, 2005 were both higher than the average for the Peer Group and that the Investment Manager has contractually agreed through May 1, 2006 to limit the Fund’s net annual operating expenses to 0.99%. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisor, the Fund’s performance, the foregoing expense limitation and the considerations noted above with respect to the Subadvisor and the Investment Manager, the Fund’s advisory fees are reasonable.
Managers Emerging Markets Equity Fund
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year, 3-year and 5-year periods ended March 31, 2005 and for the period from inception of the Fund in February 1998 through March 31, 2005 was above the median performance of the Peer Group for such periods. The Trustees also noted that the Fund’s performance for the 1-year, 3-year and 5-year periods ended March 31, 2005 and for the period from inception of the Fund through March 31, 2005 was below, below, above and above, respectively, the Fund Benchmark, which is the MSCI EMF Index. The Trustees concluded that the Fund’s performance has been satisfactory.
Advisory Fees. The Trustees noted that the Fund’s advisory fee and total expenses (net of applicable expense waivers/ reimbursements) as of March 31, 2005 were both higher than the average for the Peer Group and that the Investment Manager has contractually agreed through May 1, 2006 to limit the Fund’s net annual operating expenses to 1.79%, provided that the amount waived may not exceed 0.25%. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisor, the Fund’s performance, the foregoing expense limitation and the considerations noted above with respect to the Subadvisor and the Investment Manager, the Fund’s advisory fees are reasonable.
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Annual Renewal of Investment Advisory Agreements (continued)
Managers Small Company Fund
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year and 3-year periods ended March 31, 2005 and for the period from inception of the Fund in June 2000 through March 31, 2005 was below the median performance of the Peer Group and the performance of the Fund Benchmark, which is the Russell 2000 Index. The Trustees concluded that, in light of the market environment during the relevant time periods and the Investment Strategy pursued by the Fund’s Subadvisor, which focus on small capitalization growth companies, the Fund’s performance has been satisfactory.
Advisory Fees. The Trustees noted that the Fund’s advisory fee and total expenses (net of applicable expense waivers/ reimbursements) as of March 31, 2005 were higher than the average and lower than the average, respectively, for the Peer Group and that the Investment Manager has contractually agreed through May 1, 2006 to limit the Fund’s net annual operating expenses to 1.45%. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisor, the Fund’s performance, the foregoing expense limitation and the considerations noted above with respect to the Subadvisor and the Investment Manager, the Fund’s advisory fees are reasonable.
Managers Global Bond Fund
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was below, above, above and below, respectively, the median performance of the Peer Group and the performance of the Fund Benchmark, which is the Lehman Brothers Global Aggregate Index. The Trustee’s further noted management’s discussion of the Fund’s performance. The Trustees concluded that the Fund’s performance has been satisfactory in light of all factors considered.
Advisory Fees. The Trustees noted that the Fund’s advisory fee and total expenses (net of applicable expense waivers/ reimbursements) as of March 31, 2005 were both higher than the average for the Peer Group and that the Investment Manager has contractually agreed through May 1, 2006 to limit the Fund’s net annual operating expenses to 1.19%. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisor, the Fund’s performance, the foregoing expense limitation and the considerations noted above with respect to the Subadvisor and the Investment Manager, the Fund’s advisory fees are reasonable.
Managers International Equity Fund
Fund Performance. The Trustees noted that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was below, below, above and below, respectively, the median performance of the Peer Group and that the Fund’s performance for the 1-year, 3-year, 5-year and 10-year periods ended March 31, 2005 was below, below, below and above, respectively, the performance of the Fund Benchmark, which is the MSCI EAFE Index. The Trustees noted the favorable long-term performance of the Fund. In addition, the Trustees noted that the Investment Manager had taken action to hire new Subadvisors for the Fund in 2002 and 2004 to improve the performance of the Fund. The Trustees concluded that appropriate action is being taken to address the Fund’s performance.
Advisory Fees. The Trustees noted that the Fund’s advisory fee and total expenses (net of applicable expense waivers/ reimbursements) as of March 31, 2005 were both higher than the average for the Peer Group and that the Investment Manager has contractually agreed through May 1, 2006 to limit the Fund’s net annual operating expenses to 1.55%, provided that the amount waived may not exceed 0.25%. The Trustees concluded that, in light of the nature, extent and quality of the services provided by the Investment Manager and the Subadvisors, the Fund’s performance, the foregoing expense limitation and the considerations noted above with respect to the Subadvisors and the Investment Manager, the Fund’s advisory fees are reasonable.
After consideration of the foregoing, the Trustees also reached the following conclusions regarding the Investment Management Agreement and each Subadvisory Agreement, in addition to those conclusions discussed above: (a) the Investment Manager and each Subadvisor have demonstrated that they possess the capability and resources to perform the duties required of them under the Investment Management Agreement and the applicable Subadvisory Agreements; (b) each Subadvisor’s Investment Strategy is appropriate for pursuing the applicable Fund’s investment objectives, and in the case of a Fund with multiple subadvisors, complements the Investment Strategies of the Fund’s other Subadvisors; (c) each Subadvisor is reasonably likely to execute its Investment Strategy consistently over time; and (d) the Investment Manager and each Subadvisor maintain appropriate compliance programs.
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Annual Renewal of Investment Advisory Agreements (continued)
Based on all of the above-mentioned factors and related conclusions, with no single factor or conclusion being determinative and with each Trustee not necessarily attributing the same weight to each factor, the Trustees concluded that approval of each Investment Management Agreement and each Subadvisory Agreement would be in the interests of each Fund and its shareholders. Accordingly, on June 3, 2005 the Trustees, including a majority of the Independent Trustees, voted to approve the Investment Management Agreement and the Subadvisory Agreements for each Fund.
Managers International Equity Fund: Approval of Subadvisory Agreement with Lazard on March 4, 2005
On September 15, 2003, the Investment Manager entered into a Subadvisory Agreement with Lazard with respect to the Fund (the “Predecessor Lazard Agreement”). At the time, Lazard was a wholly-owned subsidiary of Lazard Frères & Co. LLC, which was a wholly-owned subsidiary of Lazard Group Finance LLC (“Lazard Group”). In connection with the initial public offering of securities of each of Lazard Group and Lazard Ltd., Lazard Group’s parent entity, on May 4, 2005 Lazard and its affiliates entered into a series of restructuring transactions (the “Restructuring”). To the extent that the Restructuring could be deemed to be a technical “assignment,” as defined under the Investment Company Act of 1940, as amended (the “1940 Act”, and the Investment Advisers Act of 1940, as amended, of the Predecessor Lazard Agreement, the Restructuring would cause the Predecessor Lazard Agreement, to terminate automatically pursuant to its terms, as required by Section 15(b) of the 1940 Act. For Lazard to be able to continue serving as a Subadvisor of the Fund after completion of the Restructuring, it would be necessary for the Investment Manager to enter into a new Subadvisory Agreement with Lazard (the “Lazard Agreement”). Accordingly, in March 2005 the Investment Manager requested that the Board of Trustees of the Trust approve the Lazard Agreement to replace Predecessor Lazard Agreement effective upon the completion of the Restructuring. The terms of the Lazard Agreement are substantially the same as the Predecessor Lazard Agreement.
At a meeting held on March 4, 2005, the Trustees, including a majority of the Independent Trustees, voted to approve the Lazard Agreement with respect to the Fund. The Independent Trustees were separately represented by independent counsel in connection with their consideration of the approval of the Lazard Agreement. In considering the Lazard Agreement, the Trustees reviewed and considered a variety of materials relating to the Fund and Lazard, including: comparative performance information for similarly managed funds and relevant benchmark indices; the nature, extent and quality of services to be provided by Lazard under the Lazard Agreement; and information regarding the Investment Strategy and portfolio management team of Lazard.
In considering the nature, extent and quality of services to be provided by Lazard under the Lazard Agreement, the Trustees reviewed information provided by Lazard relating to its operations and personnel. Among other things, in discussing the qualifications and experience of Lazard’s portfolio management team, the Trustees reviewed biographical information on the portfolio managers and other professional staff at Lazard, as well as information regarding the organizational and management structure of the firm. The Trustees also took into account the financial condition and structure of Lazard with respect to its ability to provide the services required under the Lazard Agreement.
The Trustees also evaluated (i) Lazard’s investment focus on long-term investment themes, (ii) the appropriateness of Lazard’s Investment Strategy for pursuing the Fund’s investment objective, (iii) the consistency of Lazard’s adherence to the Investment Strategy in managing accounts of its other advisory clients that had hired Lazard to employ the Investment Strategy, (iv) Lazard’s brokerage policies and practices, and (v) Lazard’s compliance programs, including those related to personal investing. The Trustees considered these factors, with a particular focus on the portfolio management team’s prior experience in managing a portion of the Fund’s investment portfolio, in determining that the Investment Strategy would be compatible with the investment objective of the Fund, as well as complementary with the investment strategies and techniques of the other Subadvisors to the Fund. In this context, the Trustees also considered certain information received in connection with, and their deliberations with respect to, their renewal of the investment management agreement with the Investment Manager and the other subadvisory agreements with respect to the Fund in May 2004, including comparative information with respect to the advisory and subadvisory fees of the Fund, as well as relevant updates to that information provided in the interim.
In considering the cost of services to be provided by Lazard under the Lazard Agreement and the profitability to Lazard of its relationship with the Fund, the Trustees relied on the ability of the Investment Manager to negotiate the Lazard Agreement and the fees thereunder at arm’s length in view of the Fund’s manager-of-managers structure and the lack of affiliation or other material business relationships between the Manager and Lazard. As a consequence, the cost of services to be provided by Lazard and the profitably to Lazard of its relationship with the Fund were not material factors in the Trustees’ deliberations. For similar reasons, and based on the amount of Fund assets to be managed by Lazard, the Trustees did not consider the potential economies of scale in Lazard’s management of the Fund to be material factors in their consideration at this time.
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Annual Renewal of Investment Advisory Agreements (continued)
After consideration of the foregoing factors, the Trustees also reached the following conclusions regarding the Lazard Agreement and Lazard, among others: (a) Lazard is qualified to manage the Fund’s assets assigned to it in accordance with the Fund’s investment objective and policies; (b) Lazard maintains appropriate compliance programs; (c) Lazard’s Investment Strategy is appropriate for pursuing the Fund’s investment objective and is complementary to the strategies of the other subadvisors to the Fund; (d) Lazard is reasonably likely to execute its Investment Strategy consistently over time; and (e) the Fund’s subadvisory fees to be paid by Lazard are reasonable in relation to those of similar funds and to the services to be provided by Lazard.
Based on all of the above-mentioned factors and their related conclusions, with no single factor or conclusion being determinative and with each Trustee not necessarily attributing the same weight to each factor, the Trustees concluded that approval of the Lazard Agreement would be in the interests of the Fund and its shareholders. Accordingly, on March 4, 2005 the Trustees unanimously voted to approve the Lazard Agreement.
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Administrator
Managers Investment Group LLC
800 Connecticut Avenue
Norwalk, Connecticut 06854
(203) 299-3500 or (800) 835-3879
Distributor
Managers Distributors, Inc.
800 Connecticut Avenue
Norwalk, Connecticut 06854
(203) 299-3500 or (800) 835-3879
Custodian
The Bank of New York
2 Hanson Place
Brooklyn, NY 11217
Legal Counsel
Goodwin Procter LLP
Exchange Place
Boston, Massachusetts 02109-2881
Transfer Agent
PFPC, Inc.
Attn: Managers
P.O. Box 9769
Providence, Rhode Island 02940
(800) 548-4539
For ManagersChoice Only
Managers Funds
PFPC, Inc. c/o Wrap Services
P.O. Box 9847
Providence, Rhode Island 02940
(800) 358-7668
Trustees
Jack W. Aber
William E. Chapman, II
Edward J. Kaier
Peter M. Lebovitz
William J. Nutt
Steven J. Paggioli
Eric Rakowski
Thomas R. Schneeweis
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MANAGERSAND MANAGERS AMG EQUITY FUNDS
CAPITAL APPRECIATION
Bramwell Capital Management, Inc.
Essex Investment Management Co., LLC
EMERGING MARKETS EQUITY
Rexiter Capital Management Limited
ESSEX AGGRESSIVE GROWTH
ESSEX LARGE CAP GROWTH
ESSEX SMALL/MICRO CAP GROWTH
Essex Investment Management Co., LLC
FIRST QUADRANT TAX-MANAGED EQUITY
First Quadrant, L.P.
INSTITUTIONAL MICRO-CAP
Kern Capital Management LLC
INERNATIONAL EQUITY
Bernstein Investment Research and Management
Lazard Asset Management, LLC
Wellington Management Company LLP
INTERNATIONAL GROWTH
Wellington Management Company LLP
MICRO-CAP
Kern Capital Management LLC
MID-CAP
Chicago Equity Partners, LLC
REAL ESTATE SECURITIES
Urdang Securities Management, Inc.
RENAISSANCE LARGE-CAP EQUITY
Renaissance Investment Management
RORER MID-CAP
RORER LARGE-CAP
Rorer Asset Management, LLC
SMALL CAP
TimesSquare Capital Management, LLC
SMALL COMPANY
Kalmar Investment Advisers, Inc.
SPECIAL EQUITY
Donald Smith & Co., Inc.
Kern Capital Management LLC
Skyline Asset Management, L.P.
Veredus Asset Management LLC
Westport Asset Management, Inc.
STRUCTURED CORE
First Quadrant, L.P.
SYSTEMATIC VALUE
Systematic Financial Management, L.P.
TIMESSQUARE MID CAP GROWTH
TIMESSQUARE SMALL CAP GROWTH
TimesSquare Capital Management, LLC
VALUE
Armstrong Shaw Associates Inc.
Osprey Partners Investment Mgmt., LLC
20
Oak Associates, Ltd.
MANAGERS BALANCED FUNDS
BALANCED
Chicago Equity Partners, LLC
Loomis, Sayles & Company L.P.
GLOBAL
333 Global Advisers*
Armstrong Shaw Associates Inc.
Bernstein Investment Research and Management
First Quadrant, L.P.
Kern Capital Management LLC
Northstar Capital Management, Inc.
Wellington Management Company LLP
MANAGERS FIXED INCOME FUNDS
BOND (MANAGERS)
Loomis, Sayles & Company L.P.
BOND (MANAGERS FREMONT)
Pacific Investment Management Co. LLC
CALIFORNIA INTERMEDIATE TAX-FREE
Evergreen Investment Management Co., LLC
FIXED INCOME
Loomis, Sayles & Company L.P.
GLOBAL BOND
Loomis, Sayles & Company L.P.
HIGH YIELD
J.P. Morgan Investment Management Inc.
INTERMEDIATE DURATION GOVERNMENT
Smith Breeden Associates, Inc.
MONEY MARKET (MANAGERS)
JPMorgan Investment Advisors Inc.
MONEY MARKET (FREMONT)
333 Global Advisers*
SHORT DURATION GOVERNMENT
Smith Breeden Associates, Inc.
* | A division of Managers Investment Group LLC |
This report is prepared for the Fund’s shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by an effective prospectus. To receive a free copy of the prospectus or Statement of Additional Information, which includes additional information about Fund Trustees, please contact us by calling 800.835.3879. Distributed by Managers Distributors, Inc., member NASD.
A description of the policies and procedures each Fund uses to vote its proxies is available: (i) without charge, upon request, by calling 800.835.3879, or (ii) on the Securities and Exchange Commission’s (SEC) Web site at www.sec.gov. For information regarding each Fund’s proxy voting record for the 12-month period ended June 30, call 800.835.3879 or visit the SEC Web site at www.sec.gov.
The Funds file their complete schedule of portfolio holdings with the 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 website at www.sec.gov. A Funds’ Forms N-Q 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 800.SEC.0330. For a complete list of the Funds’ portfolio holdings, view the most recent monthly holdings report, semi-annual report, or annual report at www.managersinvest.com.
SAR002-0506
www.managersinvest.com | ![]() |
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Item 2. | CODE OF ETHICS |
Not applicable for the semi-annual shareholder report.
Item 3. | AUDIT COMMITTEE FINANCIAL EXPERT |
Not applicable for the semi-annual shareholder report.
Item 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES |
Not applicable for the semi-annual shareholder report.
Item 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS |
Not applicable.
Item 6. | SCHEDULE OF INVESTMENTS |
Not applicable.
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 COMPANIES AND AFFILIATED PURCHASERS |
Not applicable.
Item 10. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS |
Not applicable.
Item 11. | CONTROLS AND PROCEDURES |
(a) | Disclosure Controls and Procedures. The Principal Executive and Financial Officers concluded that the Registrant’s Disclosure Controls and Procedures are effective based on their evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing of this report. |
(b) | Internal Controls. There were no significant changes in the Registrant’s internal controls or in other factors that could significantly affect these controls subsequent to the date of our evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. |
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Item 12. | EXHIBITS |
(a) | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Filed herewith. |
(b) | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Filed herewith. |
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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.
THE MANAGERS FUNDS | ||
By: | /s/ PETER M. LEBOVITZ | |
Peter M. Lebovitz, President | ||
Date: | September 6, 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/ PETER M. LEBOVITZ | |
Peter M. Lebovitz, President | ||
Date: | September 6, 2005 |
By: | /s/ BRUCE M. ARONOW | |
Bruce M. Aronow, Chief Financial Officer | ||
Date: | September 6, 2005 |