SEPTEMBER 30, 2007
RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
ESSENTIAL PORTFOLIO FUNDS
ESSENTIAL PORTFOLIO CONSERVATIVE FUND
ESSENTIAL PORTFOLIO MODERATE FUND
ESSENTIAL PORTFOLIO AGGRESSIVE FUND
This report and the financial statements contained herein are submitted for the general information of our shareholders. The
report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus.
Distributed by Rydex Distributors, Inc.
TABLE OF CONTENTS
LETTER TO OUR SHAREHOLDERS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
ABOUT SHAREHOLDERS’ FUND EXPENSES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3
FUND PROFILES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5
SCHEDULES OF INVESTMENTS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7
STATEMENTS OF ASSETS AND LIABILITIES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10
STATEMENTS OF OPERATIONS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
11
STATEMENTS OF CHANGES IN NET ASSETS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12
FINANCIAL HIGHLIGHTS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14
NOTES TO FINANCIAL STATEMENTS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15
OTHER INFORMATION
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
21
INFORMATION ON BOARD OF TRUSTEES AND OFFICERS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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1
LETTER TO OUR SHAREHOLDERS
DEAR SHAREHOLDER:
The second and third quarters of 2007 represented one of the most challenging environments for investors in recent
memory. The major market averages started off the period by setting new highs only to dramatically change course
in a four-week period from mid-July to mid-August by staging a gut-wrenching decline. From there, equity markets
embarked on a spectacular rally, retracing almost all of their earlier losses by the end of September. During this
period, global credit markets seized up, and interest rates on super-safe U.S. Treasury securities fell while interest
rates on everything else rose. Investors were right to ask what was happening.
What was happening was that the democratization of credit and its dispersion throughout the global financial
system was showing its nastier side. Reckless home lending practices here in the U.S. found their way into
financial markets across the globe through an array of highly engineered securities with acronyms such as CDOs,
CLOs and CMOs. Regardless of the moniker, the common thread was that by over-collateralizing low-quality
debt, as if by alchemy, vast pools of low-quality mortgages could be transformed from junk status into AAA
fixed-income securities.
Hedge funds purchased vast quantities of these structured products and leveraged this seemingly secure income
stream in order to maximize returns. The problem was that Wall Street did not fully take into account how much the
creditworthiness of home buyers had deteriorated in an era of loose underwriting standards. As rising defaults
began to eat into collateral, rating agencies rushed to downgrade large swaths of the mortgage-backed bond
market, sparking a stampede for the door.
Hedge funds were unable to meet redemption requests as investors backed away from credit exposure of all kinds.
A classic credit squeeze began to unfold as buyers disappeared and lenders, not knowing where subprime risk
resided, refused to lend.
With hedge funds failing and credit markets beginning to shut down, central banks stepped in to restore order to
the credit markets. Unfortunately, this backfired and the equity markets recoiled. Midcaps, international stocks,
energy, materials and consumer discretionary stocks all declined by double digit rates as investors attempted to limit
their exposure to the global financial system and to the U.S. consumer who looked to be going into shock.
In this environment, short-term rates came screaming down and credit spreads exploded wider as investors ran for
the safety of short maturity government debt.
The events of August ushered in the most profound development of the period—a change in monetary policy by
the Federal Reserve (“Fed”). For the first time in four years, the Fed cut the benchmark Fed Funds target rate. Given
the events leading up to this, the Fed’s September move was not unanticipated. What was a surprise, however, was
the magnitude of the move. The central bank dropped the Fed Funds rate by a half-point to 4.75%.
With that, the markets exploded in a massive rally that brought the averages almost back to where they had
started the quarter. Moreover, all the sectors that had been pummeled during the previous four weeks led the way
higher. Having suffered through the roughest market in years, investment managers were determined not to miss
the rebound.
One of the investment themes that strongly reasserted itself after the July-August sell-off was global growth. With
economic growth in the U.S. slowing, investors are favoring sectors—such as energy, technology and basic
materials—that derive much of their revenues and profits from overseas. For investors who had the fortitude to
maintain their exposure to Rydex sector funds representing those areas over the last six months, they were
handsomely rewarded with strong double digit-returns.
We also think it is very reasonable to assume that equity market volatility will be with us for some time. Low volatility
strategies as represented by the Rydex Absolute Return Strategies, Hedged Equity and Managed Futures Strategy
Funds should provide a nice offset to the more dynamic global growth theme.
We appreciate the trust you have placed in our firm’s quality and integrity by investing with us.
Sincerely,
David Reilly, CFA
Director of Portfolio Strategies
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
ABOUT SHAREHOLDERS’ FUND EXPENSES (Unaudited)
All mutual funds have operating expenses and it is important for our shareholders to understand the
impact of costs on their investments. Shareholders of a Fund incur two types of costs: (i) transaction costs,
including sales charges (loads) on purchase payments, reinvested dividends, or other distributions;
redemption fees; and exchange fees; and (ii) ongoing costs, including management fees, administrative
services, and shareholder reports, among others. These ongoing costs, or operating expenses, are
deducted from a fund’s gross income and reduce the investment return of the fund.
A fund’s expenses are expressed as a percentage of its average net assets, which is known as the expense
ratio. The following examples are intended to help investors understand the ongoing costs (in dollars) of
investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000 made at the beginning of the period and held for
the entire six-month period beginning March 31, 2007 and ending September 30, 2007.
The following tables illustrate a Fund’s costs in two ways:
Table 1. Based on actual Fund return. This section helps investors estimate the actual expenses paid
over the period. The “Ending Account Value” shown is derived from the Fund’s actual return, and the
fourth column shows the dollar amount that would have been paid by an investor who started with
$1,000 in the Fund. Investors may use the information here, together with the amount invested, to
estimate the expenses paid over the period. Simply divide the Fund’s 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
provided under the heading “Expenses Paid During Period.”
Table 2. Based on hypothetical 5% return. This section is intended to help investors compare a Fund’s
cost with those of other mutual funds. The table provides information about hypothetical account val-
ues and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return
of 5% per year 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 paid during
the period. The example is useful in making comparisons because the U.S. Securities and Exchange
Commission (the “SEC”) requires all mutual funds to calculate expenses based on the 5% return.
Investors can assess a Fund’s costs by comparing this hypothetical example with the hypothetical
examples that appear in shareholder reports of other funds.
Certain retirement plans such as IRA, SEP, Roth IRA and 403(b) accounts are charged an annual $15
maintenance fee. Upon liquidating a retirement account, a $15 account-closing fee will be taken from
the proceeds of the redemption.
The calculations above assume no shares were bought or sold during the period. Actual costs may have
been higher or lower, depending on the amount of investment and the timing of any purchases or
redemptions.
Note that the expenses shown in the table are meant to highlight and help compare ongoing costs only
and do not reflect any transactional costs which may be incurred by a Fund.
More information about a Fund’s expenses, including annual expense ratios for the past five years, can be
found in the Financial Highlights section of this report. For additional information on operating expenses
and other shareholder costs, please refer to the appropriate Fund prospectus.
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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3
ABOUT SHAREHOLDERS’ FUND EXPENSES (Unaudited) (concluded)
Beginning
Ending
Expenses
Expense
Account Value
Account Value
Paid During
Ratio†
March 31, 2007
September 30, 2007
Period*
Table 1. Based on actual Fund return
Essential Portfolio Conservative Fund
A-Class
0.01%
$1,000.00
$1,035.51
$0.06
C-Class
0.76%
1,000.00
1,030.99
3.85
H-Class
0.01%
1,000.00
1,035.48
0.05
Essential Portfolio Moderate Fund
A-Class
0.01%
1,000.00
1,042.61
0.07
C-Class
0.76%
1,000.00
1,039.05
3.89
H-Class
0.01%
1,000.00
1,042.61
0.07
Essential Portfolio Aggressive Fund
A-Class
0.01%
1,000.00
1,055.45
0.06
C-Class
0.76%
1,000.00
1,051.86
3.91
H-Class
0.01%
1,000.00
1,055.39
0.06
Table 2. Based on hypothetical 5% return
Essential Portfolio Conservative Fund
A-Class
0.01%
1,000.00
1,025.02
0.05
C-Class
0.76%
1,000.00
1,021.21
3.86
H-Class
0.01%
1,000.00
1,025.02
0.05
Essential Portfolio Moderate Fund
A-Class
0.01%
1,000.00
1,025.02
0.05
C-Class
0.76%
1,000.00
1,021.21
3.86
H-Class
0.01%
1,000.00
1,025.02
0.05
Essential Portfolio Aggressive Fund
A-Class
0.01%
1,000.00
1,025.02
0.05
C-Class
0.76%
1,000.00
1,021.21
3.86
H-Class
0.01%
1,000.00
1,025.02
0.05
of days in the most recent fiscal half-year, then divided by 365.
* Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by the number
† Does not include expenses of the underlying funds in which the Funds invest, and is annualized.
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
FUND PROFILES (Unaudited)
ESSENTIAL PORTFOLIO CONSERVATIVE FUND
OBJECTIVE:
To primarily seek preservation of capital and, secondarily, to seek long-term growth of capital.
Industry Diversification (Market Exposure as % of Net Assets)
Inception Dates:
100%
A-Class
June 30, 2006
C-Class
June 30, 2006
Money Market Fund
H-Class
June 30, 2006
80%
Ten Largest Holdings (% of Total Net Assets)
Alternative Investment Funds
Rydex Series Funds — Government Long
60%
Bond 1.2x Strategy Fund
21.0%
International Equity Fund
Rydex Series Funds — U.S. Government
Money Market Fund
17.6%
40%
Rydex Series Funds — Europe 1.25x
Fixed-Income Fund
Strategy Fund
12.8%
Rydex Series Funds — Absolute Return
Domestic Equity Funds
20%
Strategies Fund
10.7%
Rydex Series Funds — Large-Cap
Value Fund
7.2%
Essential Portfolio Conservative Fund
0%
Rydex Series Funds — Commodities
Strategy Fund
5.1%
Rydex Series Funds — Mid-Cap
“Industry Diversification (Market Exposure as % of Net Assets)” excludes
Growth Fund
4.3%
any temporary cash investments.
Rydex Series Funds — Real Estate Fund
3.4%
Rydex Series Funds — Sector Rotation Fund
3.4%
Rydex Series Funds — Small-Cap
Growth Fund
2.6%
Top Ten Total
88.1%
“Ten Largest Holdings” exclude any temporary
cash or derivative investments.
ESSENTIAL PORTFOLIO MODERATE FUND
OBJECTIVE:
To primarily seek growth of capital and, secondarily, to seek preservation of capital.
Industry Diversification (Market Exposure as % of Net Assets)
Inception Dates:
100%
A-Class
June 30, 2006
C-Class
June 30, 2006
Alternative Investment Funds
H-Class
June 30, 2006
80%
Ten Largest Holdings (% of Total Net Assets)
Rydex Series Funds — Japan 1.25x
60%
International Equity Funds
Strategy Fund
13.5%
Rydex Series Funds — Europe 1.25x
Fixed-Income Fund
Strategy Fund
13.0%
40%
Rydex Series Funds — OTC Fund
11.2%
Rydex Series Funds — Government Long
20%
Domestic Equity Funds
Bond 1.2x Strategy Fund
8.3%
Rydex Series Funds — Commodities
Strategy Fund
8.1%
Rydex Series Funds — Absolute Return
0%
Strategies Fund
5.9%
Essential Portfolio Moderate Fund
Value Fund
5.3%
Rydex Series Funds — Large-Cap
Rydex Series Funds — Nova Fund
5.3%
“Industry Diversification (Market Exposure as % of Net Assets)” excludes
Rydex Series Funds — Real Estate Fund
5.2%
any temporary cash investments.
Rydex Series Funds — Mid-Cap Growth Fund
4.4%
Grand Total
80.2%
“Ten Largest Holdings” exclude any temporary
cash or derivative investments.
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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5
FUND PROFILES (Unaudited) (concluded)
ESSENTIAL PORTFOLIO AGGRESSIVE FUND
OBJECTIVE:
To primarily seek growth of capital.
Industry Diversification (Market Exposure as % of Net Assets)
Inception Dates:
100%
A-Class
June 30, 2006
C-Class
June 30, 2006
Alternative Investment Funds
H-Class
June 30, 2006
80%
Ten Largest Holdings (% of Total Net Assets)
International Equity Funds
Rydex Series Funds — Japan 1.25x
60%
Strategy Fund
15.8%
Fixed-Income Fund
Rydex Dynamic Funds — OTC 2x
Strategy Fund
14.1%
40%
Rydex Dynamic Funds — S&P 500 2x
Strategy Fund
10.2%
Domestic Equity Funds
20%
Rydex Series Funds — Europe 1.25x
Strategy Fund
8.4%
Rydex Series Funds — Commodities
Strategy Fund
7.4%
Essential Portfolio Aggressive Fund
0%
Rydex Series Funds — Real Estate Fund
6.5%
Rydex Series Funds — Government Long
Bond 1.2x Strategy Fund
4.9%
“Industry Diversification (Market Exposure as % of Net Assets)” excludes
Rydex Series Funds — Mid-Cap Growth Fund
3.9%
any temporary cash investments.
Rydex Series Funds — Sector Rotation Fund
3.8%
Rydex Series Funds — Russell 2000® 1.5x
Strategy Fund
3.7%
Top Ten Total
78.7%
“Ten Largest Holdings” exclude any temporary
cash or derivative investments.
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
SCHEDULE OF INVESTMENTS (Unaudited)
September 30, 2007
ESSENTIAL PORTFOLIO CONSERVATIVE FUND
VALUE
MARKET
SHARES
(NOTE 1)
MUTUAL FUNDS† 98.8%
Rydex Series Funds —
Government Long Bond 1.2x
Strategy Fund
204,285
$
2,159,287
Rydex Series Funds —
U.S. Government Money
Market Fund
1,803,033
1,803,033
Rydex Series Funds — Europe
1.25x Strategy Fund
47,820
1,313,132
Rydex Series Funds — Absolute
Return Strategies Fund
40,726
1,102,855
Rydex Series Funds — Large-Cap
Value Fund
22,345
734,690
Rydex Series Funds —
Commodities Strategy Fund
19,594
525,898
Rydex Series Funds — Mid-Cap
Growth Fund
13,547
436,890
Rydex Series Funds — Real
Estate Fund
9,318
354,187
Rydex Series Funds — Sector
Rotation Fund
21,024
347,738
Rydex Series Funds — Small-Cap
Growth Fund*
7,815
265,252
Rydex Series Funds — Multi-Cap
Core Equity Fund
14,284
243,403
Rydex Series Funds — Mid-Cap
Value Fund
6,827
240,037
Rydex Series Funds — Hedged
Equity Fund
7,969
213,579
Rydex Series Funds — Large-Cap
Growth Fund*
7,232
207,114
Rydex Series Funds — Small-Cap
Value Fund
6,269
198,365
Total Mutual Funds
(Cost $9,699,901)
10,145,460
Total Investments 98.8%
(Cost $9,699,901)
$ 10,145,460
Other Assets in Excess
of Liabilities – 1.2%
$
124,615
Net Assets – 100.0%
$ 10,270,075
* Non-Income Producing Security.
† Affiliated Funds—A Class shares
See Notes to Financial Statements.
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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7
SCHEDULE OF INVESTMENTS (Unaudited)
September 30, 2007
ESSENTIAL PORTFOLIO MODERATE FUND
VALUE
MARKET
SHARES
(NOTE 1)
MUTUAL FUNDS† 98.9%
Rydex Series Funds — Japan 1.25x
Strategy Fund
292,211
$
6,703,331
Rydex Series Funds — Europe
1.25x Strategy Fund
235,864
6,476,822
Rydex Series Funds —
OTC Fund*
414,731
5,557,389
Rydex Series Funds — Government
Long Bond 1.2x Strategy Fund
388,835
4,109,983
Rydex Series Funds — Commodities
Strategy Fund
150,271
4,033,267
Rydex Series Funds — Absolute
Return Strategies Fund
108,081
2,926,821
Rydex Series Funds — Large-Cap
Value Fund
80,623
2,650,880
Rydex Series Funds — Nova Fund
81,860
2,629,346
Rydex Series Funds — Real
Estate Fund
67,975
2,583,715
Rydex Series Funds — Mid-Cap
Growth Fund
68,390
2,205,580
Rydex Series Funds — Sector
Rotation Fund
107,694
1,781,254
Rydex Series Funds — Mid-Cap
Value Fund
38,838
1,365,550
Rydex Series Funds — Small-Cap
Growth Fund*
40,127
1,361,906
Rydex Series Funds — Russell
2000® 1.5x Strategy Fund
26,464
981,287
Rydex Series Funds — Large-Cap
Growth Fund*
34,074
975,867
Rydex Series Funds — Multi-Cap
Core Equity Fund
56,882
969,264
Rydex Series Funds — Small-Cap
Value Fund
29,990
948,886
Rydex Series Funds — Hedged
Equity Fund
32,880
881,193
Total Mutual Funds
(Cost $46,149,723)
49,142,341
Total Investments 98.9%
(Cost $46,149,723)
$ 49,142,341
Other Assets in Excess
of Liabilities – 1.1%
$
522,041
Net Assets – 100.0%
$ 49,664,382
* Non-Income Producing Security.
† Affiliated Funds—A Class shares
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
See Notes to Financial Statements.
SCHEDULE OF INVESTMENTS (Unaudited)
September 30, 2007
ESSENTIAL PORTFOLIO AGGRESSIVE FUND
VALUE
MARKET
SHARES
(NOTE 1)
MUTUAL FUNDS† 98.9%
Rydex Series Funds — Japan 1.25x
Strategy Fund
199,846
$
4,584,477
Rydex Dynamic Funds — OTC 2x
Strategy Fund*
133,427
4,101,558
Rydex Dynamic Funds — S&P 500
2x Strategy Fund
56,038
2,961,057
Rydex Series Funds — Europe
1.25x Strategy Fund
89,501
2,457,704
Rydex Series Funds —
Commodities Strategy Fund
80,633
2,164,200
Rydex Series Funds — Real
Estate Fund
50,081
1,903,568
Rydex Series Funds —
Government Long Bond 1.2x
Strategy Fund
134,865
1,425,527
Rydex Series Funds — Mid-Cap
Growth Fund
35,345
1,139,882
Rydex Series Funds — Sector
Rotation Fund
66,353
1,097,482
Rydex Series Funds — Russell
2000® 1.5x Strategy Fund
29,268
1,085,266
Rydex Series Funds — Small-Cap
Value Fund
31,643
1,001,197
Rydex Series Funds — Small-Cap
Growth Fund*
28,927
981,771
Rydex Series Funds — Absolute
Return Strategies Fund
32,534
881,024
Rydex Series Funds — Mid-Cap
Value Fund
20,325
714,631
Rydex Series Funds — Large-Cap
Growth Fund*
20,083
575,173
Rydex Series Funds — Hedged
Equity Fund
21,343
571,986
Rydex Series Funds — Multi-Cap
Core Equity Fund
33,444
569,877
Rydex Series Funds — Large-Cap
Value Fund
17,286
568,359
Total Mutual Funds
(Cost $26,354,669)
28,784,739
Total Investments 98.9%
(Cost $26,354,669)
$ 28,784,739
Other Assets in Excess
of Liabilities – 1.1%
$
318,431
Net Assets – 100.0%
$ 29,103,170
* Non-Income Producing Security.
† Affiliated Funds—A Class shares
See Notes to Financial Statements.
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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9
STATEMENTS OF ASSETS AND LIABILITIES (Unaudited)
September 30, 2007
Essential
Essential
Essential
Conservative
Moderate
Aggressive
Portfolio
Portfolio
Portfolio
Fund
Fund
Fund
ASSETS
Investments in Underlying Funds at Value* (Notes 1 and 2)
$10,145,460
$49,142,341
$28,784,739
Cash
23,854
435,321
89,084
Receivable for Securities Sold (Note 1)
128,000
100,000
250,000
Receivable for Fund Shares Sold
14,685
16,973
24,051
Investment Income Receivable (Note 1)
10,320
9,531
3,457
Total Assets
10,322,319
49,704,166
29,151,331
LIABILITIES
Payable for Securities Purchased (Note 1)
10,921
10,709
3,866
Payable for Fund Shares Redeemed
40,454
22,656
41,724
Distribution and Service Fees Payable (Note 3)
869
6,344
1,780
Custody Fees Payable
—
75
791
Total Liabilities
52,244
39,784
48,161
NET ASSETS
$10,270,075
$49,664,382
$29,103,170
NET ASSETS CONSIST OF
Paid-In Capital
$ 9,875,740
$47,630,947
$28,289,699
Undistributed Net Investment Income
70,296
4,886
16,601
Accumulated Net Realized Loss on Investments
(121,520)
(964,069)
(1,633,200)
Net Unrealized Appreciation on Investments
445,559
2,992,618
2,430,070
NET ASSETS
$10,270,075
$49,664,382
$29,103,170
A-Class
$ 2,103,464
$11,870,489
$13,915,082
C-Class
3,845,374
28,342,689
8,028,580
H-Class
4,321,237
9,451,204
7,159,508
SHARES OUTSTANDING
A-Class
189,876
1,078,118
1,281,983
C-Class
350,237
2,597,442
746,892
H-Class
389,588
858,256
659,432
NET ASSET VALUES
A-Class
$11.08
$11.01
$10.85
A-Class Maximum Offering Price**
11.63
11.56
11.39
C-Class
10.98
10.91
10.75
H-Class
11.09
11.01
10.86
* The cost of investments is $9,699,901, $46,149,723, and $26,354,669, respectively.
** Net asset value adjusted for the maximum sales charge of 4.75% of offering price.
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
See Notes to Financial Statements.
STATEMENTS OF OPERATIONS (Unaudited)
Period Ended September 30, 2007
Portfolio
Essential
Essential
Essential
Conservative
Moderate
Aggressive
Portfolio
Portfolio
Fund
Fund
Fund
INVESTMENT INCOME
Dividends from Underlying Funds (Note 1)
$
66,917
$
98,552
$
46,493
Total Income
66,917
98,552
46,493
EXPENSES
Distribution & Service Fees (Note 3):
C-Class
13,229
90,526
28,706
Custody Fees
424
3,140
1,910
Total Expenses
13,653
93,666
30,616
Net Investment Income
53,264
4,886
15,877
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS (NOTE 1)
Net Realized Loss on:
Affiliated Investment Securities
(96,882)
(748,950)
(998,491)
Total Net Realized Loss
(96,882)
(748,950)
(998,491)
Net Change in Unrealized Appreciation (Depreciation) on:
Affiliated Investment Securities
293,810
2,432,120
2,279,973
Net Change in Unrealized Appreciation (Depreciation)
293,810
2,432,120
2,279,973
Net Gain on Investments
196,928
1,683,170
1,281,482
Net Increase in Net Assets from Operations
$ 250,192
$1,688,056
$1,297,359
See Notes to Financial Statements.
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
|
11
STATEMENTS OF CHANGES IN NET ASSETS
Essential Portfolio
Essential Portfolio
Conservative Fund
Moderate Fund
Period
Period
Period
Period
Ended
Ended
Ended
Ended
September 30,
March 31,
September 30,
March 31,
2007†
2007*
2007†
2007*
FROM OPERATIONS
Net Investment Income
$
53,264
$
39,396
$
4,886
$
232,930
Net Realized Gain (Loss) on Investments
(96,882)
4,459
(748,950)
589,445
Net Change in Unrealized Appreciation (Depreciation)
on Investments
293,810
151,749
2,432,120
560,498
Net Increase in Net Assets from Operations
250,192
195,604
1,688,056
1,382,873
Distributions to Shareholders from: (Note 1)**
Net Investment Income
A-Class
—
(4,908)
—
(43,427)
C-Class
—
(13,417)
—
(115,401)
H-Class
—
(20,629)
—
(75,440)
Realized Gain on Investments
A-Class
—
—)
—
(139,703)
C-Class
—
—)
—
(371,242)
H-Class
—
—)
—
(242,691)
Total Distributions to Shareholders
—
(38,954)
—
(987,904)
SHARE TRANSACTIONS
Proceeds from Shares Purchased
A-Class
1,406,283
922,583
3,963,725
9,638,247
C-Class
2,359,292
3,683,969
11,821,807
19,780,346
H-Class
3,903,029
5,576,370
7,978,842
13,553,148
Redemption Fees Collected
A-Class
1,345
1,182
749
3,538
C-Class
3,050
3,237
1,633
6,693
H-Class
3,669
4,476
769
5,726
Value of Shares Purchased through Dividend Reinvestment
A-Class
—
4,090
—
155,723
C-Class
—
12,328
—
464,693
H-Class
—
20,356
—
289,437
Cost of Shares Redeemed
A-Class
(126,559)
(170,672)
(2,263,980)
(182,346)
C-Class
(1,417,144)
(942,760)
(2,874,250)
(1,849,883)
H-Class
(3,333,261)
(2,051,630)
(7,546,203)
(5,367,057)
Net Increase in Net Assets From Share Transactions
2,799,704
7,063,529
11,083,092
36,498,265
Net Increase in Net Assets
3,049,896
7,220,179
12,771,148
36,893,234
NET ASSETS—BEGINNING OF PERIOD
7,220,179
—
36,893,234
—
NET ASSETS—END OF PERIOD
$10,270,075
$ 7,220,179
$49,664,382
$36,893,234
Undistributed Net Investment Income—End of Period
$
70,296
$
17,032
$
4,886
$
—
* Since the commencement of operations: June 30, 2006.
distributions from realized gains.
** For financial reporting purposes, certain distributions from net investment income for federal income tax purposes have been reclassified to
† Unaudited
12
|
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
See Notes to Financial Statements.
Essential Portfolio
Aggressive Fund
Period
Period
Ended
Ended
September 30,
March 31,
2007†
2007*
$
15,877
$
215,923
(998,491)
837,488
2,279,973
150,097
1,297,359
1,203,508
—
(107,051)
—
(45,811)
—
(63,061)
—
(698,818)
—
(299,049)
—
(411,659)
—
(1,625,449)
3,641,338
14,864,958
3,243,150
7,563,157
3,937,513
9,529,259
3,703
5,833
1,829
4,046
1,753
4,647
—
187,981
—
323,184
—
467,626
(4,229,996)
(977,024)
(2,086,338)
(1,287,560)
(3,584,329)
(3,386,978)
928,623
27,299,129
2,225,982
26,877,188
26,877,188
—
$29,103,170
$26,877,188
$
16,601
$
724
See Notes to Financial Statements.
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
|
13
FINANCIAL HIGHLIGHTS
This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.
RATIOS TO
Net Realized
AVERAGE NET ASSETS:
NET ASSET
Net
and
Net Increase
Distributions
Distributions
Net
NET ASSET
Net
Net Assets,
BEGINNING
Income
Gains on
Value Resulting
Investment
Realized
Total
Fees
Net Asset
END OF
Investment
Total
Income
Turnover
Period (000’s
VALUE,
Investment
Unrealized
in Net Asset
from Net
from Net
Redemption
Increase in
VALUE,
Total
Investment
Portfolio
End of
Period Ended
OF PERIOD
(Loss)†
Investments
from Operations
Income***
Gains***
Distributions
Collected
Value
PERIOD
Return†††
Expenses††
(Loss)
Rate
omitted)
September 30, 2007D
$10.70
$ .08
$
.29
$ .37
$ —
$ —
$ —
$ .01
$ .38
$11.08
3.55%
0.01%**
1.50%**
56%
$
2,103
Essential Portfolio Conservative Fund A-Class
March 31, 2007*
10.00
.20
.56
.76
(.09)
—
(.09)
.03
.70
10.70
7.94%
0.01%**
2.47%**
105%
782
September 30, 2007D
10.65
Essential Portfolio Conservative Fund C-Class
.04
.28
.32
—
—
—
.01
.33
10.98
3.10%
0.76%**
0.70%**
56%
3,845
March 31, 2007*
10.00
.08
.63
.71
(.09)
—
(.09)
.03
.65
10.65
7.44%
0.76%**
1.05%**
105%
2,804
September 30, 2007D
10.71
.08
.29
.37
—
—
—
.01
.38
11.09
3.55%
0.01%**
1.44%**
56%
4,321
Essential Portfolio Conservative Fund H-Class
March 31, 2007*
10.00
.15
.62
.77
(.09)
—
(.09)
.03
.71
10.71
8.04%
0.01%**
1.93%**
105%
3,634
Essential Portfolio Moderate Fund A-Class
March 31, 2007*
10.00
.18
.79
.97
(.10)
(.32)
(.42)
.01
.56
10.56
9.90%
—**
2.26%**
66%
9,719
September 30, 2007D
10.56
.02
.43
.45
—
—
—
—§
.45
11.01
4.26%
0.01%**
0.42%**
49%
11,870
Essential Portfolio Moderate Fund C-Class
March 31, 2007*
10.00
September 30, 2007D
10.50
(.02)
.43
.41
—
—
—
—§
.41
10.91
3.90%
0.76%**
(0.32)%**
49%
28,343
.11
.80
.91
(.10)
(.32)
(.42)
.01
.50
10.50
9.29%
0.75%**
1.34%**
66%
18,551
September 30, 2007D
10.56
.02
.43
.45
—
—
—
—§
.45
11.01
4.26%
0.01%**
0.40%**
49%
9,451
Essential Portfolio Moderate Fund H-Class
March 31, 2007*
10.00
.18
.79
.97
(.10)
(.32)
(.42)
.01
.56
10.56
9.90%
—**
2.32%**
66%
8,623
September 30, 2007D
10.28
.02
.55
.57
—
—
—
—§
.57
10.85
5.54%
0.01%**
0.29%**
44%
13,915
Essential Portfolio Aggressive Fund A-Class
March 31, 2007*
10.00
.24
.77
1.01
(.10)
(.64)
(.74)
.01
.28
10.28
10.37%
—**
3.11%**
92%
13,854
September 30, 2007D
10.22
(.02)
Essential Portfolio Aggressive Fund C-Class
.55
.53
—
—
—
—§
.53
10.75
5.19%
0.76%**
(0.46)%**
44%
8,029
March 31, 2007*
10.00
(.03)
.98
.95
(.10)
(.64)
(.74)
.01
.22
10.22
9.76%
0.75%**
(0.34)%**
92%
6,537
Essential Portfolio Aggressive Fund H-Class
March 31, 2007*
10.00
.15
.87
1.02
(.10)
(.64)
(.74)
.01
.29
10.29
10.48%
—**
1.94%**
92%
6,486
September 30, 2007D
10.29
.02
.55
.57
—
—
—
—§
.57
10.86
5.54%
0.01%**
0.29%**
44%
7,160
** Annualized
* Since the commencement of operations: June 30, 2006.
† Calculated using the average daily shares outstanding for the period.
*** For financial reporting purposes, certain distributions from net investment income for federal income tax purposes have been reclassified to distributions from realized gains.
†† Does not include expenses of the underlying funds in which the Funds invest.
§ Less than $.01 per share.
††† Total investment return does not reflect the impact of any applicable sales charges and has not been annualized.
D Unaudited
NOTES TO FINANCIAL STATEMENTS (Unaudited)
1.
Organization and Significant Accounting Policies
A. Traditional open-end investment companies (“Mutual
Organization
Funds”) are valued at their Net Asset Value (the “NAV”)
The Rydex Series Funds (the “Trust”) is registered with
as of the close of business, usually 4:00 p.m. on the val-
the SEC under the Investment Company Act of 1940
uation date. Exchange Traded Funds (“ETFs”) and
(the “1940 Act”) as a non-diversified, open-ended
closed-end investment companies are valued at the last
investment company, and is authorized to issue an
quoted sales price.
unlimited number of no par value shares. The Trust
B. Securities transactions are recorded on the trade
offers five separate classes of shares, Investor Class
date for financial reporting purposes. Realized gains
Shares, Advisor Class Shares, A-Class Shares, C-Class
and losses from securities transactions are recorded
Shares, and H-Class Shares. C-Class Shares have a 1%
using the identified cost basis. Dividend income is
contingent deferred sales charge (“CDSC”) if shares are
recorded on the ex-dividend date, net of applicable
redeemed within 12 months of purchase. Sales of
taxes withheld by foreign countries. Interest income,
shares of each Class are made without a front-end sales
including amortization of premiums and accretion of
charge at the net asset value per share, with the excep-
discount, is accrued on a daily basis.
tion of A-Class Shares. A-Class Shares are sold at net
asset value, plus the applicable front-end sales charge.
C. Interest and dividend income, most expenses, all
realized gains and losses, and all unrealized gains and
losses are allocated to the Classes based upon the
The sales charge varies depending on the amount pur-
value of the outstanding shares in each Class. Certain
chased, but will not exceed 4.75%. A-Class Share pur-
chases of $1 million or more are exempt from the
front-end sales charge but have a 1% CDSC if shares
costs, such as distribution fees relating to A-Class
are redeemed within 18 months of purchase.
Shares and H-Class Shares and service and distribution
fees related to C-Class Shares, are charged directly to
At September 30, 2007, the Trust consisted of fifty-
specific Classes. In addition, certain expenses have
three separate Funds: twenty-two Benchmark Funds,
been allocated to the individual Funds in the Trust on a
one Money Market Fund, seventeen Sector Funds, ten
pro rata basis upon the respective aggregate net assets
Alternative Strategy Funds and three Essential Portfolio
of each Fund included in the Trust.
D. Distributions of net investment income and net real-
Funds. This report covers the three Essential Portfolio
Funds (the “Funds”), while the Benchmark Funds, the
Money Market Fund, the Sector Funds, and the
ized capital gains are recorded on the ex-dividend date
Alternative Strategy Funds are contained in separate
and are determined in accordance with income tax reg-
reports. Each Essential Portfolio Fund is a “fund of
ulations, which may differ from U.S. generally accepted
funds,” which means that each Fund seeks to achieve
accounting principles. These differences are primarily
its investment objective by investing primarily in other
due to differing treatments for items such as deferral of
Rydex mutual funds (the “underlying funds”) instead of
wash sales and post-October losses. Net investment
income and loss, net realized gains and losses, and net
assets are not affected by these differences.
individual securities. At September 30, 2007, only A-
Class, C-Class and H-Class Shares had been issued by
the Funds. All share classes of the funds are subject to
E. The preparation of financial statements in conformity
a 1% redemption fee when shares are redeemed within
with U.S. generally accepted accounting principles
30 days of purchase.
requires management to make estimates and assump-
tions that affect the reported amount of assets and lia-
bilities and disclosure of contingent assets and liabilities
Rydex Investments provides advisory, transfer agent
and administrative services, and accounting services to
the Trust. Rydex Distributors, Inc. (the “Distributor”)
at the date of the financial statements and the reported
acts as principal underwriter for the Trust. Both Rydex
amounts of revenues and expenses during the reporting
Investments and the Distributor are affiliated entities.
period. Actual results could differ from these estimates.
2.
Financial Instruments
As part of their investment strategies, the underlying
Significant Accounting Policies
funds may utilize short sales and a variety of derivative
The following significant accounting policies are in con-
instruments, including options, futures, options on
formity with U.S. generally accepted accounting princi-
futures, structured notes, and swap agreements. These
ples and are consistently followed by the Trust. All time
investments involve, to varying degrees, elements of
references are based on Eastern Time. The information
market risk and risks in excess of the amounts reflected
contained in these notes may not apply to every Fund
in the underlying funds’ NAVs.
in the Trust.
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
|
15
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
Throughout the normal course of business, the underly-
notes an underlying fund invests in which may make it
ing funds enter into contracts that contain a variety of
difficult for that underlying fund to sell the structured
representations and warranties which provide general
notes it holds at an acceptable price or to accurately
indemnifications. The underlying funds’ maximum
value them. In addition, structured notes are subject to
exposure under these arrangements is unknown, as this
the risk that the counterparty to the instrument, or
would involve future claims that may be made against
issuer, might not pay interest when due or repay princi-
the underlying funds and/or their affiliates that have
pal at maturity of the obligation. Although the Trust will
not yet occurred. However, based on experience, the
not invest in any structured notes unless Rydex
underlying funds expect the risk of loss to be remote.
Investments believes that the issuer is creditworthy, an
amount expected to be received in the event of the
Short sales are transactions in which an underlying fund
underlying fund does bear the risk of loss of the
default or bankruptcy of the issuer.
sells an equity or fixed income security it does not own.
If the security sold short decreases in price between
the times the underlying fund sells the security and
The use of swaps involves risks that are different from
closes its short position, that underlying fund will real-
those associated with ordinary portfolio securities trans-
ize a gain on the transaction. Conversely, if the security
actions. Swap agreements may be considered to be
increases in price during the period, that underlying
illiquid. Although the Trust will not enter into any swap
fund will realize a loss on the transaction. The risk of
agreement unless Rydex Investments believes that the
such price increases is the principal risk of engaging in
other party to the transaction is creditworthy, the
short sales. Short dividends or interest expense is a
underlying funds bear the risk of loss of the amount
cost associated with the investment objective of short
expected to be received under a swap agreement in
sales transactions, rather than an operational cost asso-
the event of the default or bankruptcy of the agree-
ciated with the day-to-day management of any mutual
ment counterparty.
fund.
There are several risks associated with credit default
The risk associated with purchasing options is limited to
swaps. Credit default swaps involve the exchange of a
the premium originally paid. The risk in writing a cov-
fixed-rate premium for protection against the loss in
ered call option is that an underlying fund may forego
value of an underlying debt instrument in the event of
the opportunity for profit if the market price of the
a defined credit event (such as payment default or
underlying security increases and the option is exer-
bankruptcy). Under the terms of the swap, one party
cised. The risk in writing a covered put option is that an
acts as a “guarantor,” receiving a periodic payment
underlying fund may incur a loss if the market price of
that is a fixed percentage applied to a notional princi-
the underlying security decreases and the option is
pal amount. In return, the party agrees to purchase the
exercised. In addition, there is the risk that an underly-
notional amount of the underlying instrument, at par, if
ing fund may not be able to enter into a closing trans-
a credit event occurs during the term of the swap. An
action because of an illiquid secondary market or, for
underlying fund may enter into credit default swaps in
over-the-counter options, because of the counterparty’s
which that underlying fund or its counterparty act as
inability to perform.
guarantors. By acting as the guarantor of a swap, that
the underlying instrument, including liquidity and loss
There are several risks in connection with the use of
underlying fund assumes the market and credit risk of
futures contracts. Risks may be caused by an imperfect
correlation between movements in the price of the
of value.
instruments and the price of the underlying securities.
In conjunction with the use of short sales, options,
In addition, there is the risk that an underlying fund
futures, options on futures, and swap agreements, the
may not be able to enter into a closing transaction
underlying funds are required to maintain collateral in
because of an illiquid secondary market.
various forms. The underlying funds use, where appro-
There are several risks associated with the use of struc-
priate, depending on the financial instrument utilized
tured notes. Structured securities are leveraged,
and the broker involved, margin deposits at the broker,
thereby providing an exposure to the underlying
cash and/or securities segregated at the custodian
benchmark of three times the face amount and increas-
bank, discount notes, or the repurchase agreements
ing the volatility of each note relative to the change in
allocated to each underlying fund.
the underlying linked financial instrument. A highly liq-
The risks inherent in the use of structured notes,
uid secondary market may not exist for the structured
options, short sales, futures contracts, options on
16
|
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
futures contracts, and swap agreements, include i)
suant to Rule 12b-1 under the 1940 Act, as amended. If
adverse changes in the value of such instruments; ii)
a Service Provider provides distribution or shareholder
imperfect correlation between the price of the instru-
services, the Distributor will, in turn, pay the Service
ments and movements in the price of the underlying
Provider for the services it provides at an annual rate
securities, indices, or futures contracts; iii) the possible
not to exceed 0.25% of the average daily net assets of
absence of a liquid secondary market for any particular
a Fund.
instrument at any time; and iv) the potential of counter-
party default.
The Funds have adopted a Distribution and
Shareholder Services Plan applicable to its C-Class
The Trust has established strict counterparty credit
Shares that allows the Funds to pay annual distribution
guidelines and enters into transactions only with finan-
and service fees of 0.75% of the Funds’ C-Class Shares
cial institutions of investment grade or better.
average daily net assets. The annual 0.25% service fee
3.
Fees And Other Transactions With Affiliates
compensates the shareholder’s financial advisor for pro-
Rydex Investments manages the investment and the
viding on-going services to the shareholder. The annual
reinvestment of the assets of each of the Funds in
0.50% distribution fee reimburses the Distributor for
accordance with the investment objectives, policies,
paying the shareholder’s financial advisor an ongoing
sales commission. The Distributor advances the first
and limitations of each Fund, however, the Funds do
year’s service and distribution fees to the financial advi-
not pay Rydex Investments a management fee. As part
sor. The Distributor retains the service and distribution
of its agreement with the Trust, Rydex Investments will
pay all expenses of the Funds, including the cost of
fees on accounts with no authorized dealer of record.
transfer agency, fund administration, audit and other
During the period ended September 30, 2007, the
services, excluding interest expense, taxes (expected to
Distributor retained sales charges of $370,341 relating
be de minimis), brokerage commissions and other
to sales of A-Class Shares of the Trust.
expenses connected with the execution of portfolio
Certain officers and trustees of the Trust are also offi-
transactions, short dividend expenses, and extraordi-
cers of Rydex Investments.
4.
Federal Income Tax Information
nary expenses.
Each Fund indirectly bears a proportionate share of the
The Funds intend to comply with the provisions of
total operating expenses (including investment man-
agement, shareholder servicing, custody, transfer
Subchapter M of the Internal Revenue Code and will
agency, audit and other underlying fund expenses) of
distribute substantially all net investment income and
the underlying funds in which the Fund invests. In addi-
capital gains to shareholders. Therefore, no Federal
tion, some underlying funds charge redemption fees if
income tax provision has been recorded.
a shareholder, including a Fund, redeems shares before
Income and capital gain distributions are determined in
the end of the Funds’ requisite holding period.
accordance with Federal income tax regulations, which
Therefore, if a Fund sells shares of an underlying fund
may differ from U.S. generally accepted accounting
that is subject to a redemption fee, that Fund will be
principles. These differences are primarily due to differ-
responsible for paying the redemption fee to the
ing treatments for derivatives, foreign currency transac-
underlying fund.
tions, losses deferred due to wash sales, losses
deferred due to post-October losses, and excise tax
Rydex Investments provides transfer agent, accounting
regulations.
services and administrative services to the Funds.
However, the related fees are paid by Rydex
Permanent book and tax basis differences, if any, will
Investments, as noted above.
result in reclassifications. This includes reclasses due to
The Funds have not adopted a Distribution Plan and a
net operating losses, non-deductible expenses, differ-
ences in the treatment of certain investments, and the
Shareholder Services Plan with respect to A-Class
utilization of earnings and profits distributed to the
Shares and H-Class Shares. Instead, the Funds invest in
shareholders on redemption of shares as part of the
underlying funds that have a distribution plan that
allows the underlying funds to pay distribution fees to
dividends paid deduction for income tax purposes.
These reclassifications have no effect on net assets or
the Distributor and other firms that provide distribution
services (“Service Providers”). The underlying funds will
net asset values per share.
pay distribution fees to the Distributor at an annual rate
At September 30, 2007, the cost of securities for
not to exceed 0.25% of average daily net assets, pur-
Federal income tax purposes, the aggregate gross
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
|
17
NOTES TO FINANCIAL STATEMENTS (Unaudited) (continued)
unrealized gain for all securities for which there was an excess of value over tax cost and the aggregate gross unrealized
loss for all securities for which there was an excess of tax cost over value, were as follows:
Tax
Tax
Net
Tax
Unrealized
Unrealized
Unrealized
Fund
Cost
Gain
Loss
Gain
Essential Portfolio Conservative Fund
$
9,808,058
$
370,203
$
(32,801)
$
337,402
Essential Portfolio Moderate Fund
46,889,741
2,628,257
(375,657)
2,252,600
Essential Portfolio Aggressive Fund
26,837,123
2,252,419
(304,803)
1,947,616
5.
Securities Transactions
During the period ended September 30, 2007, the cost of purchases and proceeds from sales of investment securities,
excluding short-term and temporary cash investments, were:
Essential Portfolio
Essential Portfolio
Essential Portfolio
Conservative Fund
Moderate Fund
Aggressive Fund
Purchases
$7,855,479
$33,745,339
$14,267,667
Sales
$4,994,995
$22,443,332
$13,243,765
18
|
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
NOTES TO FINANCIAL STATEMENTS (continued)
6.
Share Transactions
The Trust is authorized to distribute an unlimited number of no par value shares. Transactions in shares for the periods presented were:
Shares Purchased
Purchased through
Net Shares
Dividend Reinvestment
Shares Redeemed
Purchased (Redeemed)
September 30,
Period Ended
Period Ended
March 31,
September 30,
Period Ended
Period Ended
March 31,
September 30,
Period Ended
Period Ended
March 31,
September 30,
Period Ended
Period Ended
March 31,
2007†
2007*
2007†
2007*
2007†
2007*
2007†
2007*
Essential Portfolio Conservative Fund
A-Class
C-Class
128,423
88,762
—
391
(11,621)
(16,079)
116,802
73,074
H-Class
357,705
218,157
532,377
352,492
—
—
1,942
1,181
(307,403)
(131,298)
(195,033)
(90,295)
50,302
86,859
263,378
Essential Portfolio Moderate Fund
339,286
A-Class
C-Class
1,099,087
366,190
1,899,090
922,952
—
—
15,148
45,380
(208,777)
(268,277)
(177,838)
(17,395)
830,810
157,413
1,766,632
920,705
Essential Portfolio Aggressive Fund
H-Class
731,407
1,302,388
—
28,155
(689,789)
(513,905)
41,618
816,638
A-Class
342,147
1,423,819
—
18,742
(407,186)
(95,539)
(65,039)
1,347,022
C-Class
H-Class
373,529
309,072
914,707
734,083
—
—
46,623
32,351
(344,643)
(201,573)
(330,784)
(127,041)
107,499
28,886
630,546
639,393
† Unaudited
* Since the commencement of operations: June 30, 2006.
NOTES TO FINANCIAL STATEMENTS (Unaudited) (concluded)
7.
New Accounting Pronouncements
On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB Interpretation No. 48 “Accounting
for Uncertainty in Income Taxes” (FIN 48). FIN 48 provides guidance for how uncertain tax positions should be recog-
nized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions
taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether the tax positions
are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the
more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is
required for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective
date. Recent SEC guidance allows implementing FIN 48 in fund net asset value calculations as late as a fund’s last net
asset value calculation in the first required financial statement reporting period. Management adopted FIN 48 on
September 28, 2007. There was no material impact to the financial statements or disclosures thereto as a result of the
adoption of this pronouncement.
On September 15, 2006, the FASB released Statement of Financial Accounting Standard No. 157 (“FAS 157”) Fair Value
Measurement which provided enhanced guidance for using fair value to measure assets and liabilities. The standard
requires companies to provide expanded information about the assets and liabilities measured at fair value and the
potential effect of these fair valuations on an entity’s financial performance. The standard does not expand the use of fair
value in any new circumstances, but provides clarification on acceptable fair valuation methods and applications.
Adoption of FAS 157 is required for fiscal years beginning after November 15, 2007. The standard is not expected to
materially impact the Funds’ financial statements.
8.
Acquisition of Rydex Investments and the Distributor
On June 28, 2007, Rydex NV, Inc. and Security Benefit Corporation (“Security Benefit”) entered into an agreement pur-
suant to which Rydex Investments, together with several other Rydex entities, will be acquired by Security Benefit, a
financial services firm that provides a broad variety of financial programs to investors in the advisor, banking, education,
government, institutional, and qualified plan markets (the “Transaction”). Upon completion of the Transaction, Rydex
Investments and the Distributor will be wholly-owned subsidiaries of Security Benefit. While the Transaction will have no
material impact on the Funds or their shareholders, it will result in a change of control of Rydex Investments, which in
turn will cause the termination of the investment advisory agreement between Rydex Investments and the Funds.
As a result, a Special Meeting of Shareholders (the “Meeting”) of the Funds was held on October 4, 2007, for the pur-
pose of asking shareholders of record to approve a new investment advisory agreement between Rydex Investments
and the Funds under substantially the same terms as the previous investment advisory agreement (the “New
Agreement”). If approved by shareholders, the New Agreement will take effect upon the closing of the Transaction,
which is currently anticipated to occur in the 4th Quarter of 2007. Shareholders of the Funds will receive additional, and
more detailed, information about the Transaction as that information becomes available.
The Transaction will have no impact on the day-to-day operations of Rydex Investments, the fees payable to Rydex
Investments under the New Agreement, or the persons responsible for the management of the Funds. Thus, the
Transaction should have no impact on the Funds’ shareholders.
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
OTHER INFORMATION (Unaudited)
Proxy Voting Information
A description of the policies and procedures that the Trust uses to determine how to vote proxies relating to securities
held in the Funds’ portfolios is available, without charge and upon request, by calling 1-800-820-0888. This information
is also available from the EDGAR database on the SEC’s website at http://www.sec.gov.
Information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month
period ended June 30 is available without charge, upon request, by calling 1-800-820-0888. This information is also
available from the EDGAR database on the SEC’s website at http://www.sec.gov.
Quarterly Portfolio Schedules Information
The Trust files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year
on Form N-Q which is available on the SEC’s website at http://www.sec.gov. The Funds’ Forms N-Q may be reviewed
and copied at the SEC’s Public Reference Room in Washington, DC, and that information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330. Copies of the portfolio holdings are also available to
shareholders, without charge and upon request, by calling 1-800-820-0888.
Rydex Investments Board Review and Approval of the Investment Advisory Agreement
The Investment Company Act of 1940 (the “1940 Act”) requires that the initial approval of, as well as the continuation
of, a fund’s investment advisory agreement be specifically approved by the vote of a majority of the trustees who are
not parties to the investment advisory agreement or “interested persons” of any party (the “Independent Trustees”),
cast in person at a meeting called for the purpose of voting on such approval. In connection with such approvals, the
fund’s trustees must request and evaluate, and the investment adviser is required to furnish, such information as may be
reasonably necessary to evaluate the terms of the advisory agreement. In addition, the Securities and Exchange
Commission (the “SEC”) takes the position that, as part of their fiduciary duties with respect to fund fees, fund boards
are required to evaluate the material factors applicable to a decision to approve an investment advisory agreement.
Consistent with these responsibilities, the Rydex Series Funds Board of Trustees (the “Board”) generally calls and holds
one meeting each year that is dedicated to considering whether to renew the investment advisory agreements between
Rydex Series Funds (the “Trust”) and PADCO Advisors, Inc., which does business under the name Rydex Investments
(“Rydex Investments”), (the “Current Agreements”) with respect to existing funds in the Trust, including the funds dis-
cussed in this Semi-Annual Report (each a “Fund” and collectively, the “Funds”), and to reviewing certain other agree-
ments pursuant to which Rydex Investments provides investment advisory services to certain other registered
investment companies. In preparation for the meeting, the Board requests and reviews a wide variety of materials pro-
vided by Rydex Investments, including information about Rydex Investments’ affiliates, personnel and operations. The
Board also receives data provided by third parties. This information is in addition to the detailed information about the
Funds that the Board reviews during the course of each year, including information that relates to Fund operations and
performance. The Board also receives a memorandum from Fund counsel regarding the responsibilities of the Board for
the approval of investment advisory agreements. In addition, the Independent Trustees receive advice from independ-
ent counsel to the Independent Trustees, meet in executive session outside the presence of fund management, and
participate in question and answer sessions with representatives of Rydex Investments.
At a Special Meeting of the Board held on July 10, 2007, and subsequently, during the Board’s regular quarterly meet-
ing held on August 27 and 28, 2007 (the “Annual Renewal Meeting” and together with the July 10, 2007 Meeting, the
“Meetings”), the Board considered and voted in favor of new investment advisory agreements for Rydex Series Funds
(each, a “New Agreement” and collectively, the “New Agreements”), which, subject to their approval by each Fund’s
shareholders, will enable Rydex Investments to continue to serve as investment adviser to each Fund after the comple-
tion of the acquisition of Rydex Investments’ parent, Rydex Holdings, Inc. (the “Transaction”). During the Annual
Renewal Meeting, the Board also considered and approved the selection of Rydex Investments and the continuance of
the Current Agreements for an additional one-year period or until the closing of the Transaction, based on its review of
qualitative and quantitative information provided by Rydex Investments.
Board Considerations in Approving the New Agreements and the Continuation of the Current Agreements
In preparation for the Annual Renewal Meeting, the Board requested and received written materials from Rydex
Investments about: (a) the quality of Rydex Investments’ investment management and other services; (b) Rydex
Investments’ investment management personnel; (c) Rydex Investments’ operations and financial condition; (d) Rydex
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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OTHER INFORMATION (Unaudited) (continued)
Investments’ brokerage practices (including any soft dollar arrangements) and investment strategies; (e) the level of the
advisory fees that Rydex Investments charges the Funds compared with the fees it charges to comparable mutual funds
or accounts; (f) each Fund’s overall fees and operating expenses compared with similar mutual funds; (g) the level of
Rydex Investments’ profitability from its Fund-related operations; (h) Rydex Investments’ compliance systems; (i) Rydex
Investments’ policies on and compliance procedures for personal securities transactions; (j) Rydex Investments’ reputa-
tion, expertise and resources in the financial markets; and (k) Fund performance compared with similar mutual funds.
Certain of these considerations are discussed in more detail below.
In its deliberations at the Annual Renewal Meeting, the Board did not identify any single piece of information that was
all-important or controlling. Based on the Board’s deliberations and its evaluation of the information referenced above
and described in more detail below, the Board, including all of the Independent Trustees, unanimously: (a) concluded
that terms of the Current Agreements and New Agreements were fair and reasonable; (b) concluded that Rydex
Investments’ fees were reasonable in light of the services that Rydex Investments provides to the Funds; (c) agreed to
renew each Current Agreement for an additional one-year term; and (d) agreed to approve the New Agreements for an
initial term of two years.
In approving the New Agreements and the continuation of the Current Agreements at the Annual Renewal Meeting, the
Board, including the Independent Trustees advised by independent counsel, considered the factors discussed below.
Nature, Extent And Quality Of Services Provided By Rydex Investments
At the Annual Renewal Meeting, the Board reviewed the scope of services to be provided by Rydex Investments
under each Current Agreement and noted that there would be no significant differences between the scope of serv-
ices required to be provided by Rydex Investments for the past year and the scope of services required to be pro-
vided by Rydex Investments for the upcoming year. In reviewing the scope of services provided to the Funds by Rydex
Investments, the Board reviewed and discussed Rydex Investments’ investment experience, noting that Rydex
Investments and its affiliates have committed significant resources over time to the support of the Funds. The Board
also considered Rydex Investments’ compliance program and its compliance record with respect to the Funds. In that
regard, the Board noted that Rydex Investments provides information regarding the portfolio management and com-
pliance to the Board on a periodic basis in connection with regularly scheduled meetings of the Board. In addition to
the above considerations, the Board reviewed and considered Rydex Investments’ investment processes and strate-
gies, and matters related to Rydex Investments’ portfolio transaction policies and procedures. With respect to those
Funds that invest in unaffiliated ETFs in reliance on exemptive orders pursuant to Section 12(d)(1), the Board consid-
ered and determined that the advisory fees charged under the Current Agreements are based on services provided
that will be in addition to, rather than duplicative of, the services provides under the investment advisory agreement
of any ETF in which the Funds are invested. In particular, the Board recognized that Rydex Investments must manage
a Fund’s investment in an unaffiliated ETF in the same manner as other investments in the Fund’s portfolio in order to
ensure that the Fund achieves its investment objective. Thus, a Fund’s investment in an unaffiliated ETF does not alle-
viate Rydex Investments’ duties and responsibilities as investment adviser to the Fund. The Board also noted the sub-
stantial volume of portfolio trades and shareholder transaction activity, in general, processed by Rydex Investments
due to the unlimited exchange policy of the majority of the Funds. The Board further noted that the Funds have con-
sistently met their investment objectives since their respective inception dates. Based on this review, the Board con-
cluded that the nature, extent, and quality of services to be provided by Rydex Investments to the Funds under the
Current Agreements were appropriate and continued to support the Board’s original selection of Rydex Investments
as investment adviser to the Funds.
Fund Expenses And Performance Of The Funds And Rydex Investments
At the Annual Renewal Meeting, the Board reviewed statistical information prepared by Rydex Investments regarding
the expense ratio components, including actual advisory fees, waivers/reimbursements, and gross and net total
expenses of each Fund in comparison with the same information for other funds registered under the 1940 Act deter-
mined by Rydex Investments to comprise each Fund’s applicable peer group. Because few funds seek to provide
unlimited exchange privileges similar to those of the majority of the Funds, each Fund’s applicable peer group is gen-
erally limited to the funds of two unaffiliated mutual fund families. In addition, the Board reviewed statistical informa-
tion prepared by Rydex Investments relating to the performance of each Fund, as well as each Fund’s ability to
successfully track its benchmark over time, and a comparison of each Fund’s performance to funds with similar invest-
ment objectives for the same periods and to appropriate indices/benchmarks, in light of total return, yield and market
22
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
OTHER INFORMATION (Unaudited) (continued)
trends. The Board further noted that despite the unique nature of the Funds, the peer fund information presented to
the Board was meaningful because the peer funds’ investment objectives and strategies were closely aligned with
those of the Funds. The Board noted that most of the Funds either outperformed their peer funds or performed in
line with them over relevant periods. The Board also noted that the investment advisory fees for the Funds were
equivalent to those of their peers and that the overall expenses for the Funds were only slightly higher than the total
expenses of the peer funds, due in part to differing share classes and distribution fees. Based on this review, the
Board concluded that the investment advisory fees and expense levels and the historical performance of the Funds, as
managed by Rydex Investments, as compared to the investment advisory fees and expense levels and performance of
the peer funds, were satisfactory for the purposes of approving the continuance of the Current Agreements.
Costs Of Services Provided To The Funds And Profits Realized By Rydex Investments And Its Affiliates
At the Annual Renewal Meeting, the Board reviewed information about the profitability of the Funds to Rydex
Investments based on the advisory fees payable under the Current Agreements for the last calendar year. Rydex
Investments also presented the Board with material discussing its methodology for determining the level of advisory
fees assessable to the Funds. The Board analyzed the Funds’ expenses, including the investment advisory fees paid to
Rydex Investments. The Board also reviewed information regarding direct revenue received by Rydex Investments and
ancillary revenue received by Rydex Investments and/or its affiliates in connection with the services provided to the
Funds by Rydex Investments (as discussed below) and/or its affiliates. The Board also discussed Rydex Investments’
profit margin as reflected in Rydex Investments’ profitability analysis and reviewed information regarding economies of
scale (as discussed below). Based on this review, the Board concluded that the profits to be realized by Rydex
Investments and its affiliates under the Current Agreements and from other relationships between the Funds and
Rydex Investments and/or its affiliates, if any, were within the range the Board considered reasonable and appropriate.
Economies Of Scale
In connection with its review of the Funds’ profitability analysis at the Annual Renewal Meeting, the Board reviewed
information regarding economies of scale or other efficiencies that may result from increases in the Funds’ asset levels.
The Board noted that neither the Current Agreements nor the New Agreements for the Funds provided for any
breakpoints in the investment advisory fees as a result of increases in the asset levels of the Funds. The Board also
noted that though Rydex Investments’ assets under management were significant, the amount is spread among more
than 100 Funds. Further limiting the realization of economies of scale, is the ability of shareholders of many of the
Funds to engage in unlimited trading. The Board also reviewed and considered Rydex Investments’ historic profitabil-
ity as investment adviser to the Funds and determined that reductions in advisory fees or additions of breakpoints
were not warranted at this juncture. Based on this review, the Board, recognizing its responsibility to consider this
issue at least annually, determined that the economies of scale, if any, were de minimis.
Other Benefits To Rydex Investments And/Or Its Affiliates
At the Annual Renewal Meeting, in addition to evaluating the services provided by Rydex Investments, the Board also
considered the nature, extent, quality and cost of the administrative, distribution, and shareholder services performed
by Rydex Investments’ affiliates under separate agreements. The Board noted that Rydex Investments reports its use
of soft dollars to the Board on a quarterly basis, as well as any portfolio transactions on behalf of the Funds placed
through an affiliate of the Funds or Rydex Investments pursuant to Rule 17e-1 under the 1940 Act. Based on its
review, the Board concluded that the nature and quality of the services provided by Rydex Investments’ affiliates to
each Trust will benefit the Funds’ shareholders, and that any ancillary benefits would not be disadvantageous to the
Funds’ shareholders, particularly in light of the Board’s view that the Funds’ shareholders benefit from investing in a
fund that is part of a large family of funds offering a variety of investment strategies and services.
Additional Considerations in Approving the New Agreements
On June 18, 2007, the Trustees met with representatives of Security Benefit and the management of Rydex Investments
for the purpose of learning more about Security Benefit and the proposed Transaction. Immediately following the
announcement that Rydex and Security Benefit entered into a purchase and sale agreement, the Trustees requested
that Rydex Investments provide the Board with additional information pertaining to the effect of the proposed change
of control on Rydex Investments’ personnel and operations and the terms of the New Agreements. Rydex Investments
presented its response to the Board’s request for additional information prior to and at a Special Meeting of the Boards
of Trustees held on July 10, 2007. Rydex Investments provided the Board with oral and written information to help the
Board evaluate the impact of the change of control on Rydex Investments, Rydex Investments’ ability to continue to
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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23
OTHER INFORMATION (Unaudited) (concluded)
provide investment advisory services to the Funds under the New Agreements, and informed the Board that the con-
tractual rate of Rydex Investments’ fees will not change under the New Agreements. Rydex Investments also affirmed
that the terms of the New Agreements were the same in all material respects to those of the Current Agreements.
The Trustees deliberated on the approval of each New Agreement in light of the information provided. The Board
determined that the terms of the New Agreements set forth materially similar rights, duties and obligations on Rydex
Investments with regard to the services to be provided to the Trusts, and provided at least the same level of protection
to each Trust, the Funds and the Funds’ shareholders as the Current Agreements. The Board also noted that Rydex
Investments’ fee for its services to the Funds under the New Agreements would be the same as its fees under the
Current Agreements. The Board further noted that all considerations, determinations and findings related to the
approval of the continuation of the Current Agreements, as discussed above, were equally relevant to their approval of
the New Agreements, along with the additional factors relevant to the proposed change of control discussed below.
Nature, Extent And Quality Of Services Provided By The Advisor
The Board noted that Rydex Investments was taking appropriate steps to maintain its associates through the closing
of the Transaction by, in part, keeping them informed of the potential Transaction and awarding key personnel with
incentives to emphasize their value to Rydex Investments. As a result of these efforts, it is anticipated that the key
investment and management personnel servicing the Funds will remain with Rydex Investments following the
Transaction and that the investment and management services provided to the Funds by Rydex Investments will not
change. The Board also considered Rydex Investments’ and Security Benefit’s representations to the Board that
Security Benefit intends for Rydex Investments to continue to operate following the closing of the Transaction in much
the same manner as it operates today, and that the Transaction should have no impact on the day-to-day operations
of Rydex Investments, or the persons responsible for the management of the Funds. Based on this review, the Board
concluded that the range and quality of services provided by Rydex Investments to the Funds were appropriate and
were expected to continue under the New Agreements, and that there was no reason to expect the consummation of
the Transaction to have any adverse effect on the services provided by Rydex Investments and its affiliates or the
future performance of the Funds.
Fund Expenses
The Board also considered the fact that the fees payable to Rydex Investments and other expenses of the Funds
would be the same under the New Agreements as they are under the Current Agreements, and on this basis, the
Board concluded that these fees and expenses continued to be satisfactory for the purposes of approving the New
Agreements. More detailed information regarding the fees under each New Agreement is contained in the Proxy
Statement and accompanying materials dated September 6, 2007.
Costs Of Services Provided To The Funds And Profits Realized By Rydex Investments And Its Affiliates
Because Rydex Investments’ fees under the New Agreements are the same as those assessed under the Current
Agreements, the Board concluded that the profits to be realized by Rydex Investments and its respective affiliates
under the New Agreements and from other relationships between the Funds and Rydex Investments, if any, should
remain within the range the Board considered reasonable and appropriate. The Board further noted that, although it
is not possible to predict how the Transaction may affect Rydex Investments’ future profitability from its relationship
with the Funds, this matter would be given further consideration on an annual basis going forward.
Economies Of Scale
The Board further considered the potential economies of scale that may result from the Transaction, and concluded
that the extent of such economies of scale could not be predicted in advance of the closing of the Transaction.
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THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
INFORMATION ON BOARD OF TRUSTEES AND OFFICERS (Unaudited)
A Board of Trustees oversees all Rydex Investments, in which its members have no stated term of service, and continue to serve
after election until resignation. The Statement of Additional Information includes further information about Fund Trustees and
Officers, and can be obtained without charge by calling 1-800-820-0888.
All Trustees and Officers may be reached c/o Rydex Investments, 9601 Blackwell Rd., Suite 500, Rockville, MD 20850.
TRUSTEES AND OFICERS
Length of Service
Name, Position and
As Trustee
Number of
–––––––––––––––––––––
Year of Birth
––––––––––––––––––––––––––––––––
(Year Began)
––––––––––——––––––
Funds Overseen
Carl G. Verboncoeur*
Rydex Series Funds – 2004
141
Trustee, President (1952)
Rydex Variable Trust – 2004
Rydex Dynamic Funds – 2004
Rydex ETF Trust – 2004
Principal Occupations During Past Five Years: Chief Executive Officer and Treasurer of Rydex Specialized Products, LLC (2005
to present); Chief Executive Officer of Rydex Investments and Rydex Distributors, Inc. (2003 to present); Executive Vice President
of Rydex Investments (2000 to 2003)
Michael P. Byrum*
Rydex Series Funds – 2005
141
Trustee, Vice President
Rydex Variable Trust – 2005
(1970)
Rydex Dynamic Funds – 2005
Rydex ETF Trust – 2005
Principal Occupations During Past Five Years: Secretary of Rydex Specialized Products, LLC (2005 to present); Vice President
of Rydex Series Funds (1997 to present); Vice President of Rydex Variable Trust (1998 to present); Vice President of Rydex
Dynamic Funds (1999 to present); Vice President of Rydex ETF Trust (2002 to present); President and Trustee of Rydex Capital
Partners SPhinX Fund (2003 to 2006); President of Rydex Investments (2004 to present); Chief Operating Officer of Rydex
Investments and Rydex Distributors, Inc. (2003 to 2004)
INDEPENDENT TRUSTEES
Name, Position and
Length of Service As Trustee
Number of
–––––––––––––––––––––
Year of Birth
––––––––––––––––––––––––––––––––
(Year Began)
––––––––––——––––––
Funds Overseen
John O. Demaret
Rydex Series Funds – 1997
133
Trustee, Chairman of the
Rydex Variable Trust – 1998
Board (1940)
Rydex Dynamic Funds – 1999
Rydex ETF Trust – 2003
Principal Occupations During Past Five Years: Retired
Corey A. Colehour
Rydex Series Funds – 1993
133
Trustee (1945)
Rydex Variable Trust – 1998
Rydex Dynamic Funds – 1999
Rydex ETF Trust – 2003
Principal Occupations During Past Five Years: Retired (2006 to present); Owner and President of Schield Management
Company, registered investment adviser (2005 to 2006); Senior Vice President of Marketing and Co-Owner of Schield
Management Company, registered investment adviser (1985 to 2005)
J. Kenneth Dalton
Rydex Series Funds – 1995
133
Trustee (1941)
Rydex Variable Trust – 1998
Rydex Dynamic Funds – 1999
Rydex ETF Trust – 2003
Principal Occupations During Past Five Years: Mortgage Banking Consultant and Investor, The Dalton Group
THE RYDEX SERIES FUNDS SEMI-ANNUAL REPORT
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25
INFORMATION ON BOARD OF TRUSTEES AND OFFICERS (Unaudited) (concluded)
Name, Position and
Length of Service As Trustee
Number of
–––––––––––––––––––––
Year of Birth
Rydex Series Funds – 2005
––––––––––––––––––––––––––––––––
(Year Began)
––––––––––——––––––
Funds Overseen
Werner E. Keller
133
Trustee (1940)
Rydex Variable Trust – 2005
Rydex Dynamic Funds – 2005
Rydex ETF Trust – 2005
Principal Occupations During Past Five Years: Retired (2001 to present); Chairman, Centurion Capital Management (1991
to 2001)
Thomas F. Lydon, Jr.
Rydex Series Funds – 2005
133
Trustee (1960)
Rydex Variable Trust – 2005
Rydex Dynamic Funds – 2005
Rydex ETF Trust – 2005
Principal Occupations During Past Five Years: President, Global Trends Investments
Patrick T. McCarville
Rydex Series Funds – 1997
133
Trustee (1942)
Rydex Variable Trust – 1998
Rydex Dynamic Funds – 1999
Rydex ETF Trust – 2003
Principal Occupations During Past Five Years: Founder and Chief Executive Officer, Par Industries, Inc.
Roger Somers
Rydex Series Funds – 1993
133
Trustee (1944)
Rydex Variable Trust – 1998
Rydex Dynamic Funds – 1999
Rydex ETF Trust – 2003
Principal Occupations During Past Five Years: Owner, Arrow Limousine
EXECUTIVE OFFICERS
Name, Position and
Principal Occupations
–––––––––––––––––––––
Year of Birth
–––––––––––––––––––––––––––
During Past Five Years
Nick Bonos*
Chief Financial Officer of Rydex Specialized Products, LLC (2005 to
Vice President and Treasurer (1963)
present); Vice President and Treasurer of Rydex Series Funds,
Rydex Variable Trust, Rydex Dynamic Funds, and Rydex ETF Trust
(2003 to present); Senior Vice President of Rydex Investments
(2003 to present); Vice President and Treasurer of Rydex Capital
Partners SPhinX Fund (2003 to 2006); Vice President of Accounting
of Rydex Investments (2000 to 2003)
Joanna M. Haigney*
Chief Compliance Officer of Rydex Series Funds, Rydex Variable
Chief Compliance Officer and
Trust, and Rydex Dynamic Funds (2004 to present); Secretary of
Secretary (1966)
Rydex Series Funds, Rydex Variable Trust, and Rydex Dynamic
Funds (2000 to present); Secretary of Rydex ETF Trust (2002 to
present); Vice President of Compliance of Rydex Investments
(2000 to present); Secretary of Rydex Capital Partners SPhinX
Fund (2003 to 2006)
Joseph Arruda*
Assistant Treasurer of Rydex Series Funds, Rydex Variable Trust,
Assistant Treasurer (1966)
Rydex Dynamic Funds, Rydex ETF Trust (2006 to present); Vice
President of Rydex Investments (2004 to present); Director of
Accounting of Rydex Investments (2003 to 2004); Vice President of
Mutual Funds, State Street Bank & Trust (2000 to 2003)
Paula Billos*
Controller of Rydex Series Funds, Rydex Variable Trust, Rydex
Controller (1974)
Dynamic Funds, Rydex ETF Trust (2006 to present); Director of
Fund Administration of Rydex Investments (2001 to present)
this person is affiliated with Rydex Investments.
* Officers of the Fund are deemed to be “interested persons” of the Trust, within the meaning of Section 2(a)(19) of the 1940 Act, inasmuch as
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9601 Blackwell Road, Suite 500
Rockville, MD 20850
www.rydexinvestments.com
800-820-0888
RSEP-SEMI-0907x0308
