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 811-1800
U.S. GLOBAL INVESTORS FUNDS
7900 CALLAGHAN ROAD
SAN ANTONIO, TX 78229
(Address of principal executive offices) (Zip code)
SUSAN B. MCGEE, ESQ.
7900 CALLAGHAN ROAD
SAN ANTONIO, TX 78229
(Name and address of agent for service)
Registrant's telephone number, including area code:
210-308-1234
Date of fiscal year end: JUNE 30, 2004
Date of reporting period: DECEMBER 31, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
U.S. GLOBAL INVESTORS FUNDS
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SEMI-ANNUAL REPORT
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DECEMBER 31, 2003
(UNAUDITED)
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TABLE OF CONTENTS
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LETTER TO SHAREHOLDERS 1
MANAGEMENT TEAMS' PERSPECTIVES 10
PORTFOLIOS OF INVESTMENTS 40
NOTES TO PORTFOLIOS OF INVESTMENTS 86
STATEMENTS OF ASSETS AND LIABILITIES 92
STATEMENTS OF OPERATIONS 96
STATEMENTS OF CHANGES IN NET ASSETS 100
NOTES TO FINANCIAL STATEMENTS 106
FINANCIAL HIGHLIGHTS 115
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NASDAQ SYMBOLS
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U.S. TREASURY SECURITIES CASH FUND USTXX
U.S. GOVERNMENT SECURITIES SAVINGS FUND UGSXX
NEAR-TERM TAX FREE FUND NEARX
TAX FREE FUND USUTX
ALL AMERICAN EQUITY FUND GBTFX
CHINA REGION OPPORTUNITY FUND USCOX
GLOBAL RESOURCES FUND PSPFX
WORLD PRECIOUS MINERALS FUND UNWPX
GOLD SHARES FUND USERX
[USGI Logo]
P.O. Box 781234
San Antonio, Texas 78278-1234
Tel 1*800*US*FUNDS
Fax 210*308*1217
www.usfunds.com
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U.S. GLOBAL INVESTORS FUNDS
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DEAR SHAREHOLDER
Dear Shareholder,
Every asset class has its day in the sun, and for [PHOTO OF FRANK E. HOLMES]
the past year we have managed funds in the
strongest-performing asset classes: natural resource
stocks, and emerging markets in China and Eastern
Europe. By maintaining performance in these sectors,
we have experienced strong asset growth and become
widely recognized as leaders in managing natural-resource-based
companies. As a result of strong asset inflows--and the introduction
in 2002 of a small-account fee--our expense ratios have fallen.
Lower expense ratios translate to lower relative costs to our fund
shareholders--that means you!
To give just two examples, below are charts demonstrating asset
growth and expense ratios for the Gold Shares Fund(1) and World
Precious Minerals Fund.(1)
Gold Shares Fund(1)
[Graphic: Bar graph created from data points in following table.]
Average Net Assets Expense Ratio
FY 2001 $22,363,139 5.79%
FY 2002 $31,979,028 3.57%
FY 2003 $44,267,624 2.64%
YTD Thru Dec 31, 2003* $63,624,590 1.95%
*This expense ratio is based on the six-month period ended December
31, 2003. Expense ratios are annualized for periods of less than one
year. Net assets at December 31, 2003 are $86 million.
1
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U.S. GLOBAL INVESTORS FUNDS
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WORLD PRECIOUS MINERALS FUND(1)
[Graphic: Bar graph created from data points in following table.]
Average Net Assets Expense Ratio
FY 2001 $44,311,987 2.86%
FY 2002 $56,483,612 2.27%
FY 2003 $86,849,436 1.92%
YTD Thru Dec 31, 2003* $184,334,298 1.40%
*This expense ratio is based on the six-month period ended December
31, 2003. Expense ratios are annualized for periods of less than one
year. Net assets at December 31, 2003 are $288 million.
Now look at these funds' growth of $10,000 over the same time
period:
GROWTH OF $10,000
[Graphic: Line graph created from data points in following table.]
Date Gold Shares Fund World Precious Minerals
6/30/2000 $10,000.00 $10,000.00
7/31/2000 $9,041.10 $8,942.46
8/31/2000 $9,589.04 $9,300.16
9/29/2000 $8,972.60 $8,351.48
10/31/2000 $8,082.19 $7,465.01
11/30/2000 $8,219.18 $7,387.25
12/31/2000 $8,938.36 $7,886.47
1/31/2001 $8,835.62 $7,808.39
2/28/2001 $9,041.10 $7,792.77
3/30/2001 $8,219.18 $7,277.42
4/30/2001 $9,315.07 $7,964.55
5/31/2001 $9,726.03 $8,276.89
6/30/2001 $9,691.78 $8,245.66
7/31/2001 $8,972.60 $7,777.15
8/31/2001 $9,212.33 $7,886.47
9/30/2001 $9,589.04 $8,339.36
10/31/2001 $9,452.05 $8,230.04
11/30/2001 $9,383.56 $8,183.19
12/31/2001 $9,931.51 $8,479.91
1/31/2002 $11,575.34 $9,963.50
2/28/2002 $13,253.42 $10,916.12
3/31/2002 $15,136.99 $12,696.44
4/30/2002 $16,643.84 $14,023.86
5/31/2002 $22,054.79 $19,739.60
6/30/2002 $18,082.19 $16,288.29
7/31/2002 $13,356.16 $11,712.58
8/31/2002 $15,445.21 $13,336.72
9/30/2002 $15,890.41 $13,430.42
10/31/2002 $13,698.63 $11,650.11
11/30/2002 $13,835.62 $11,775.05
12/31/2002 $18,013.70 $15,553.71
1/31/2003 $18,458.90 $16,147.00
2/28/2003 $17,294.52 $15,553.71
3/31/2003 $16,198.63 $14,655.77
4/30/2003 $15,479.45 $14,270.93
5/31/2003 $17,226.03 $15,313.19
6/30/2003 $17,739.73 $15,633.89
7/31/2003 $18,664.38 $16,644.08
8/31/2003 $21,712.33 $19,514.30
9/30/2003 $22,671.23 $21,021.56
10/31/2003 $26,198.63 $25,719.75
11/30/2003 $31,130.14 $29,968.96
12/31/2003 $30,096.65 $29,971.74
The following charts demonstrate the performance of our Gold Shares
and World Precious Minerals Funds as compared to their benchmark
indexes, as well as to the S&P 500 Total Return Index, over the past
three and five years.
2
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U.S. GLOBAL INVESTORS FUNDS
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THREE-YEAR SNAPSHOT
[Graphic: Line graph created from data points in following table.]
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Date Gold Shares Fund Philadelphia Stock Exchange
Gold & Silver Index
12/31/00 $10,000.00 $10,000.00
01/31/01 9,885.06 9,503.99
02/28/01 10,114.94 10,213.97
03/30/01 9,195.40 9,253.06
04/30/01 10,421.46 10,723.59
05/31/01 10,881.23 11,112.62
06/30/01 10,842.91 10,357.91
07/31/01 10,038.31 10,320.95
08/31/01 10,306.51 11,001.75
09/30/01 10,727.97 11,241.00
10/31/01 10,574.71 10,606.89
11/30/01 10,498.08 10,225.64
12/31/01 11,111.11 10,587.43
01/31/02 12,950.19 11,929.59
02/28/02 14,827.59 12,674.58
03/31/02 16,934.87 13,789.15
04/30/02 18,620.69 14,386.31
05/31/02 24,674.33 16,385.92
06/30/02 20,229.89 13,900.02
07/31/02 14,942.53 11,775.92
08/31/02 17,279.69 13,510.99
09/30/02 17,777.78 13,565.45
10/31/02 15,325.67 12,340.01
11/30/02 15,478.93 12,328.34
12/31/02 20,153.26 14,930.95
01/31/03 20,651.34 14,977.63
02/28/03 19,348.66 14,003.11
03/31/03 18,122.61 13,016.92
04/30/03 17,318.01 12,701.81
05/31/03 19,272.03 14,289.05
06/30/03 19,846.74 15,298.58
07/31/03 20,881.23 15,779.03
08/31/03 24,291.19 17,700.84
09/30/03 25,363.98 17,724.18
10/31/03 29,310.34 19,078.00
11/30/03 34,827.59 21,330.48
12/31/03 $ 33,671.35 $21,170.98
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FIVE-YEAR SNAPSHOT
[Graphic: Line graph created from data points in following table.]
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Date Gold Shares Fund Philadelphia Stock Exchange
Gold & Silver Index
12/31/98 $10,000.00 $10,000.00
01/29/99 9,554.97 9,736.80
02/26/99 9,345.55 9,321.23
03/31/99 9,293.19 9,198.09
04/30/99 10,340.31 11,300.60
05/28/99 8,717.28 9,368.94
06/30/99 8,952.88 10,301.68
07/30/99 8,376.96 9,676.77
08/31/99 8,821.99 10,364.78
09/30/99 11,230.37 12,353.39
10/29/99 10,052.36 10,704.94
11/30/99 9,633.51 10,318.61
12/31/99 9,738.22 10,461.75
01/31/00 8,560.21 9,231.95
02/29/00 8,612.57 9,198.09
03/31/00 7,958.12 8,696.32
04/28/00 7,329.84 8,426.97
05/31/00 7,329.84 8,662.46
06/30/00 7,643.98 8,897.95
07/31/00 6,910.99 7,826.69
08/31/00 7,329.84 8,056.03
09/29/00 6,858.64 7,683.55
10/31/00 6,178.01 6,752.35
11/30/00 6,282.72 7,246.42
12/31/00 6,832.46 7,912.88
01/31/01 6,753.93 7,520.39
02/28/01 6,910.99 8,082.19
03/30/01 6,282.72 7,321.84
04/30/01 7,120.42 8,485.45
05/31/01 7,434.55 8,793.29
06/30/01 7,408.38 8,196.09
07/31/01 6,858.64 8,166.85
08/31/01 7,041.88 8,705.56
09/30/01 7,329.84 8,894.87
10/31/01 7,225.13 8,393.10
11/30/01 7,172.77 8,091.43
12/31/01 7,591.62 8,377.71
01/31/02 8,848.17 9,439.74
02/28/02 10,130.89 10,029.24
03/31/02 11,570.68 10,911.19
04/30/02 12,722.51 11,383.72
05/31/02 16,858.64 12,965.98
06/30/02 13,821.99 10,998.92
07/31/02 10,209.42 9,318.15
08/31/02 11,806.28 10,691.09
09/30/02 12,146.60 10,734.19
10/31/02 10,471.20 9,764.51
11/30/02 10,575.92 9,755.27
12/31/02 13,769.63 11,814.68
01/31/03 14,109.95 11,851.62
02/28/03 13,219.90 11,080.50
03/31/03 12,382.20 10,300.14
04/30/03 11,832.46 10,050.79
05/31/03 13,167.54 11,306.76
06/30/03 13,560.21 12,105.59
07/31/03 14,267.02 12,485.76
08/31/03 16,596.86 14,006.46
09/30/03 17,329.84 14,024.93
10/31/03 20,026.18 15,096.20
11/30/03 23,795.81 16,878.56
12/31/03 $23,005.82 $16,752.35
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The average annual performance for the periods ended December 31, 2003 were:
One Year Three Year Five Year Ten Year
Gold Shares Fund 67.08% 49.88% 18.12% (9.99)%
Philadelphia Stock Exchange Gold &
Silver Index 41.79% 28.40% 10.87% (1.90)%
3
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THREE-YEAR SNAPSHOT
[Graphic: Line graph created from data points in following table.]
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Date WORLD PRECIOUS MINERALS FUND TORONTO STOCK EXCHANGE
GOLD & PRECIOUS MINERALS INDEX
12/31/00 $10,000.00 $10,000.00
01/31/01 9,900.99 9,410.67
02/28/01 9,881.19 9,832.58
03/30/01 9,227.72 9,048.69
04/30/01 10,099.01 10,435.58
05/31/01 10,495.05 10,659.94
06/30/01 10,455.45 10,345.08
07/31/01 9,861.39 10,173.63
08/31/01 10,000.00 10,774.63
09/30/01 10,574.26 11,858.36
10/31/01 10,435.64 10,970.78
11/30/01 10,376.24 10,596.77
12/31/01 10,752.48 11,019.30
01/31/02 12,633.66 12,306.05
02/28/02 13,841.58 12,868.53
03/31/02 16,099.01 13,420.41
04/30/02 17,782.18 14,334.96
05/31/02 25,029.70 16,694.98
06/30/02 20,653.47 14,548.52
07/31/02 14,851.49 11,735.25
08/31/02 16,910.89 13,307.62
09/30/02 17,029.70 13,220.27
10/31/02 14,772.28 12,028.79
11/30/02 14,930.69 11,813.32
12/31/02 19,722.02 14,050.23
01/31/03 20,474.30 14,288.57
02/28/03 19,722.02 13,343.14
03/31/03 18,583.43 12,565.75
04/30/03 18,095.46 12,405.35
05/31/03 19,417.04 13,797.53
06/30/03 19,823.68 14,173.69
07/31/03 21,104.60 14,415.27
08/31/03 24,744.02 16,646.26
09/30/03 26,655.23 16,299.69
10/31/03 32,612.50 17,825.02
11/30/03 38,000.47 20,623.37
12/31/03 $38,004.00 $20,056.65
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FIVE-YEAR SNAPSHOT
[Graphic: Line graph created from data points in following table.]
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Date WORLD PRECIOUS MINERALS FUND TORONTO STOCK EXCHANGE
GOLD & PRECIOUS MINERALS INDEX
12/31/98 $10,000.00 $10,000.00
01/29/99 9,573.56 9,738.12
02/26/99 9,371.00 9,162.87
03/31/99 9,179.10 8,929.05
04/30/99 10,277.19 10,525.75
05/28/99 8,400.85 8,713.44
06/30/99 8,304.90 9,278.55
07/30/99 7,835.82 8,695.57
08/31/99 8,166.31 8,989.39
09/30/99 10,287.85 11,320.83
10/29/99 9,232.41 9,723.31
11/30/99 8,827.29 9,140.14
12/31/99 8,731.34 8,747.44
01/31/00 7,750.53 7,757.89
02/29/00 7,878.46 7,551.53
03/31/00 7,281.45 7,080.35
04/28/00 6,918.98 7,374.56
05/31/00 6,705.76 7,652.50
06/30/00 6,855.01 7,816.56
07/31/00 6,130.06 6,909.77
08/31/00 6,375.27 7,200.88
09/29/00 5,724.95 6,992.56
10/31/00 5,117.27 6,250.27
11/30/00 5,063.97 6,911.01
12/31/00 5,406.18 7,508.92
01/31/01 5,352.66 7,066.40
02/28/01 5,341.95 7,383.20
03/30/01 4,988.68 6,794.59
04/30/01 5,459.71 7,835.99
05/31/01 5,673.82 8,004.46
06/30/01 5,652.41 7,768.04
07/31/01 5,331.25 7,639.29
08/31/01 5,406.18 8,090.58
09/30/01 5,716.64 8,904.34
10/31/01 5,641.70 8,237.87
11/30/01 5,609.58 7,957.03
12/31/01 5,812.99 8,274.30
01/31/02 6,829.99 9,240.52
02/28/02 7,483.01 9,662.87
03/31/02 8,703.42 10,077.28
04/30/02 9,613.37 10,764.00
05/31/02 13,531.52 12,536.13
06/30/02 11,165.64 10,924.37
07/31/02 8,028.99 8,811.90
08/31/02 9,142.34 9,992.58
09/30/02 9,206.57 9,926.99
10/31/02 7,986.16 9,032.32
11/30/02 8,071.81 8,870.53
12/31/02 10,662.09 10,550.20
01/31/03 11,068.78 10,729.17
02/28/03 10,662.09 10,019.26
03/31/03 10,046.54 9,435.52
04/30/03 9,782.74 9,315.08
05/31/03 10,497.21 10,360.45
06/30/03 10,717.05 10,642.91
07/31/03 11,409.53 10,824.31
08/31/03 13,377.07 12,499.54
09/30/03 14,410.30 12,239.31
10/31/03 17,630.91 13,384.66
11/30/03 20,543.75 15,485.92
12/31/03 $20,545.66 $15,060.38
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The average annual performance for the periods ended December 31, 2003 were:
One Year Three Year Five Year Ten Year
World Precious Minerals Fund 92.70% 56.05% 15.48% 1.61%
Toronto Stock Exchange Gold &
Precious Minerals Index 42.75% 26.11% 8.53% (3.25)%
4
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U.S. GLOBAL INVESTORS FUNDS
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THREE-YEAR SNAPSHOT
[Graphic: Line graph created from data points in following table:
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Date Gold Shares Fund World Precious Minerals Fund S&P 500 Total Return Index
12/31/00 $10,000.00 $10,000.00 $10,000.00
01/31/01 9,885.06 9,900.99 10,354.79
02/28/01 10,114.94 9,881.19 9,410.62
03/30/01 9,195.40 9,227.72 8,814.45
04/30/01 10,421.46 10,099.01 9,499.43
05/31/01 10,881.23 10,495.05 9,563.08
06/30/01 10,842.91 10,455.45 9,330.32
07/31/01 10,038.31 9,861.39 9,238.47
08/31/01 10,306.51 10,000.00 8,660.13
09/30/01 10,727.97 10,574.26 7,960.80
10/31/01 10,574.71 10,435.64 8,112.61
11/30/01 10,498.08 10,376.24 8,734.89
12/31/01 11,111.11 10,752.48 8,811.42
01/31/02 12,950.19 12,633.66 8,682.83
02/28/02 14,827.59 13,841.58 8,515.38
03/31/02 16,934.87 16,099.01 8,835.64
04/30/02 18,620.69 17,782.18 8,299.95
05/31/02 24,674.33 25,029.70 8,238.80
06/30/02 20,229.89 20,653.47 7,651.88
07/31/02 14,942.53 14,851.49 7,055.45
08/31/02 17,279.69 16,910.89 7,101.77
09/30/02 17,777.78 17,029.70 6,329.96
10/31/02 15,325.67 14,772.28 6,887.10
11/30/02 15,478.93 14,930.69 7,292.47
12/31/02 20,153.26 19,722.02 6,864.05
01/31/03 20,651.34 20,474.30 6,684.24
02/28/03 19,348.66 19,722.02 6,583.94
03/31/03 18,122.61 18,583.43 6,647.87
04/30/03 17,318.01 18,095.46 7,195.46
05/31/03 19,272.03 19,417.04 7,574.56
06/30/03 19,846.74 19,823.68 7,671.19
07/31/03 20,881.23 21,104.60 7,806.45
08/31/03 24,291.19 24,744.02 7,958.69
09/30/03 25,363.98 26,655.23 7,874.17
10/31/03 29,310.34 32,612.50 8,319.62
11/30/03 34,827.59 38,000.47 8,392.81
12/31/03 $ 33,671.35 $38,004.00 $ 8,832.97
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FIVE-YEAR SNAPSHOT
Graphic: Line graph created from data points in following table
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Date Gold Shares Fund World Precious Minerals Fund S&P 500 Total Return Index
12/31/98 $10,000.00 $10,000.00 $10,000.00
01/29/99 9,554.97 9,573.56 10,418.16
02/26/99 9,345.55 9,371.00 10,094.38
03/31/99 9,293.19 9,179.10 10,498.24
04/30/99 10,340.31 10,277.19 10,904.79
05/28/99 8,717.28 8,400.85 10,647.27
06/30/99 8,952.88 8,304.90 11,238.18
07/30/99 8,376.96 7,835.82 10,887.27
08/31/99 8,821.99 8,166.31 10,833.41
09/30/99 11,230.37 10,287.85 10,536.42
10/29/99 10,052.36 9,232.41 11,203.18
11/30/99 9,633.51 8,827.29 11,430.92
12/31/99 9,738.22 8,731.34 12,104.15
01/31/00 8,560.21 7,750.53 11,496.01
02/29/00 8,612.57 7,878.46 11,278.40
03/31/00 7,958.12 7,281.45 12,381.69
04/28/00 7,329.84 6,918.98 12,009.23
05/31/00 7,329.84 6,705.76 11,762.84
06/30/00 7,643.98 6,855.01 12,052.83
07/31/00 6,910.99 6,130.06 11,864.39
08/31/00 7,329.84 6,375.27 12,601.34
09/29/00 6,858.64 5,724.95 11,936.08
10/31/00 6,178.01 5,117.27 11,885.62
11/30/00 6,282.72 5,063.97 10,948.56
12/31/00 6,832.46 5,406.18 11,002.15
01/31/01 6,753.93 5,352.66 11,392.49
02/28/01 6,910.99 5,341.95 10,353.71
03/30/01 6,282.72 4,988.68 9,697.79
04/30/01 7,120.42 5,459.71 10,451.41
05/31/01 7,434.55 5,673.82 10,521.44
06/30/01 7,408.38 5,652.41 10,265.36
07/31/01 6,858.64 5,331.25 10,164.30
08/31/01 7,041.88 5,406.18 9,528.00
09/30/01 7,329.84 5,716.64 8,758.59
10/31/01 7,225.13 5,641.70 8,925.61
11/30/01 7,172.77 5,609.58 9,610.26
12/31/01 7,591.62 5,812.99 9,694.45
01/31/02 8,848.17 6,829.99 9,552.98
02/28/02 10,130.89 7,483.01 9,368.74
03/31/02 11,570.68 8,703.42 9,721.10
04/30/02 12,722.51 9,613.37 9,131.73
05/31/02 16,858.64 13,531.52 9,064.45
06/30/02 13,821.99 11,165.64 8,418.71
07/31/02 10,209.42 8,028.99 7,762.51
08/31/02 11,806.28 9,142.34 7,813.47
09/30/02 12,146.60 9,206.57 6,964.31
10/31/02 10,471.20 7,986.16 7,577.28
11/30/02 10,575.92 8,071.81 8,023.28
12/31/02 13,769.63 10,662.09 7,551.92
01/31/03 14,109.95 11,068.78 7,354.09
02/28/03 13,219.90 10,662.09 7,243.75
03/31/03 12,382.20 10,046.54 7,314.08
04/30/03 11,832.46 9,782.74 7,916.55
05/31/03 13,167.54 10,497.21 8,333.65
06/30/03 13,560.21 10,717.05 8,439.96
07/31/03 14,267.02 11,409.53 8,588.77
08/31/03 16,596.86 13,377.07 8,756.27
09/30/03 17,329.84 14,410.30 8,663.28
10/31/03 20,026.18 17,630.91 9,153.36
11/30/03 23,795.81 20,543.75 9,233.89
12/31/03 $23,005.82 $20,545.66 $9,718.16
- -----------------------------------------------------------------------------------------------------------------------------------
The average annual performance for the periods ended December 31,
2003 were:
One Year Three Year Five Year Ten Year
Gold Shares Fund 67.08% 49.88% 18.12% (9.99)%
World Precious Minerals Fund 92.70% 56.05% 15.48% 1.61%
S&P 500 Total Return Index 28.68% (4.05)% (0.57)% 11.07%
This really has been a great year, and the next 12 months look
promising to us as well. We are entering the final stretch of the
presidential election cycle. What does that mean for investors?
5
- --------------------------------------------------------------------
U.S. GLOBAL INVESTORS FUNDS
- --------------------------------------------------------------------
Historically, wars, recessions and bear markets have occurred during
the first half of presidential terms--and bull markets during the
second. This is partly because sitting presidents do everything they
can to stimulate the economy when election time draws near.
President George W. Bush is now entering his fourth year in office.
With the situation in Iraq still uncertain, he has implemented tax
credits designed to kick-start the economy, and so far it seems to
be working.
The presidential election cycle is the subject of one of our latest
research papers, available online at www.usfunds.com/cycle. (You can
also obtain a printed copy by calling one of our representatives at
1-800-US-FUNDS.) This report contains the results of extensive
research, some of which may surprise you. For example, did you know
that the only severe stock-market loss in a pre-presidential-
election year was in 1931, during the Great Depression? These and
other exciting facts are covered in our special report, and we
encourage you to get a free copy. There is no guarantee that this
cycle will repeat itself, but with interest rates remaining at
45-year lows and consumer spending rising in response to tax
credits, we believe the odds are in our favor. The chart below shows
that, historically, the first two quarters of an election year tend
to be the weakest, while the third and fourth quarters are the
strongest.
Dow Jones Industrials Cycle Composite
Graphic: Line graph created from data points in following table:
Based on weekly data
1/16//1900 - 12/31/2003
Trend is more important than level
January 0.00
0.40
0.85
0.90
0.85
February 0.20
0.40
0.43
0.20
March 0.80
1.00
1.40
0.90
April 1.10
1.20
1.10
0.70
0.50
May -0.20
-0.10
-0.30
0.40
June 0.70
0.75
0.70
0.90
July 1.60
1.70
1.60
2.20
2.80
August 3.00
3.10
3.20
3.65
September 3.55
3.50
3.55
3.30
October 3.15
3.60
4.05
3.90
4.40
November 5.40
5.80
6.30
5.70
December 6.00
6.40
7.40
Lines represent cumulative year-to-date percent gains
Source: Ned Davis Research
6
- --------------------------------------------------------------------
U.S. GLOBAL INVESTORS FUNDS
- --------------------------------------------------------------------
Another free report we've published is entitled "The Wisdom of Diversification"
(reprinted on the page following this letter and also on the Web at
www.usfunds.com/wisdom). It comprises a chart, which is similar in appearance to
the periodic table of elements we all had to study in chemistry class. But
instead of elements, the chart displays asset classes and the way they have
fluctuated over a 20-year time period. The purpose of the chart is to
demonstrate why you need a well-balanced, diversified portfolio. By allocating
your assets among a variety of categories, you protect yourself from
unpredictable shifts in the market. In other words, you avoid putting all your
eggs in one basket.
To keep your portfolio diversified, we recommend rebalancing at least once a
year, using your age to determine what percentage to put into fixed-income
investments. (For example, if you are 60 years old, 60 percent should be in
fixed-income.) A good time to rebalance is on your birthday or between Christmas
and New Year's Eve.
There are many exciting developments afoot at U.S. Global Investors. I thank you
for investing in our funds and look forward to the days ahead.
Sincerely,
/s/ Frank Holmes
- ------------------------------------------
Frank E. Holmes
Chairman, Chief Investment Officer and CEO
U.S. Global Investors, Inc.
(1) Gold funds may be susceptible to adverse economic, political or regulatory
developments due to concentrating in a single theme. The price of gold is
subject to substantial price fluctuations over short periods of time and may be
affected by unpredicted international monetary and political policies. We
suggest investing no more than 3% to 5% of your portfolio in gold or gold
stocks.
As of 12/31/03, the Gold Shares Fund's annualized performance for the 1-, 5- and
10-year periods is 67.08%, 18.12% and -9.99%.
7
- --------------------------------------------------------------------
U.S. GLOBAL INVESTORS FUNDS
- --------------------------------------------------------------------
As of 12/31/03, the World Precious Minerals Fund's annualized
performance for the 1-, 5- and 10-year periods is 92.70%, 15.48% and
1.61%.
As of 12/31/03, the Philadelphia Stock Exchange Gold & Silver
Index's annualized performance for the 1-, 5- and 10-year periods is
41.79%, 10.87% and -1.90%. The Philadelphia Stock Exchange Gold &
Silver Index is a capitalization-weighted index which includes the
leading companies involved in the mining of gold and silver. These
are not total returns. These returns reflect simple appreciation
only and do not show the effect of dividend reinvestment.
As of 12/31/03, the Toronto Stock Exchange Gold & Precious Minerals
Index's annualized performance for the 1-, 5- and 10-year periods is
42.75%, 8.53% and -3.25%. The Toronto Stock Exchange Gold & Precious
Minerals Index is a capitalization-weighted index designed to
measure the performance of the gold and precious minerals sector of
the TSX 300 Index. These are not total returns. These returns
reflect simple appreciation only and do not show the effect of
dividend reinvestment.
As of 12/31/03, the S&P 500 Total Return Index's annualized
performance for the 1-, 5- and 10-year periods is 28.68%, -0.57% and
11.07%. The S&P 500 Total Return Index is a widely recognized
capitalization-weighted index of 500 common stock prices in U.S.
companies.
The Dow Jones Industrial Average is a price-weighted average of 30
blue chip stocks that are generally leaders in their industry.
Please keep in mind that high double-digit and triple-digit returns
are highly unusual and cannot be sustained. Recent returns were
achieved during favorable market conditions for these asset classes
and countries, especially within the gold sector. Performance data
quoted represent past performance and investment return and
principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than
their original cost.
For more complete information about any U.S. Global fund, including
charges and expenses, obtain a prospectus by visiting us at
www.usfunds.com or call 1-800-US-FUNDS (1-800-873-8637). Read it
carefully before you invest or send money. Distributed by U.S.
Global Brokerage, Inc.
8
- --------------------------------------------------------------------
U.S. GLOBAL INVESTORS FUNDS
- --------------------------------------------------------------------
The Wisdom of Diversification
Take a moment to study this chart. As you can see, not one investment category
has performed consistently over the 20-year period. For example, in 1984, the
gold sector was the worst performer. By 1987, it was the best. Fast-forward to
1999, when, at the peak of the dot-com boom, small-cap growth stocks were the
best performers. The next year they hit rock bottom. This is why you need a
well-balanced, diversified portfolio. By allocating your assets among a variety
of categories, you protect yourself from unpredictable shifts in the market. In
other words, you avoid putting all your eggs in one basket.
[Graphics: The Wisdom of Diversification Table]
Ranking of Investment Categories from Best to Worst Over the Last 20 Years
BEST
PERFORMERS
^ ----------------------------------------------------------------------------------------------------------------------
| 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994
| ----------------------------------------------------------------------------------------------------------------------
|
| Bond Int'l Gold Gold Small Gold Bond Small Small Gold Int'l
| Value Growth Value
| ----------------------------------------------------------------------------------------------------------------------
| Large Gold Gold Int'l Int'l Large Large Mid Large Int'l Large
| Value Growth Growth Cap Value Growth
| ----------------------------------------------------------------------------------------------------------------------
| Int'l Mid Bond Large Large Mid Mid Small Mid Small Small
| Cap Growth Value Cap Cap Value Cap Value Value
| ----------------------------------------------------------------------------------------------------------------------
| Small Large Large Large Mid Large Large Large Bond Large Large
| Value Growth Value Value Cap Value Value Growth Value Value
| ----------------------------------------------------------------------------------------------------------------------
| Mid Bond Mid Mid Small Small Small Large Small Bond Small
| Cap Cap Cap Growth Growth Growth Value Growth Growth
| ----------------------------------------------------------------------------------------------------------------------
| Large Large Large Bond Large Bond Gold Bond Large Mid Mid
| Growth Value Growth Growth Growth Cap Cap
| ----------------------------------------------------------------------------------------------------------------------
| Small Small Small Small Bond Small Small Int'l Gold Small Bond
| Growth Value Value Value Value Value Growth
| ----------------------------------------------------------------------------------------------------------------------
| Gold Small Small Small Gold Int'l Int'l Gold Int'l Large Gold
WORST Growth Growth Growth Growth
PERFORMERS ----------------------------------------------------------------------------------------------------------------------
BEST
PERFORMERS
^ --------------------------------------------------------------------------------------------
| 1995 1996 1997 1998 1999 2000 2001 2002 2003
| --------------------------------------------------------------------------------------------
| Large Large Large Large Small Small Small Gold Small
| Value Growth Value Growth Growth Value Value Growth
| --------------------------------------------------------------------------------------------
| Large Large Mid Int'l Large Bond Gold Bond Small
| Growth Value Cap Growth Value
| --------------------------------------------------------------------------------------------
| Small Small Small Mid Int'l Mid Bond Small Gold
| Growth Value Value Cap Cap Value
| --------------------------------------------------------------------------------------------
| Mid Mid Large Large Mid Large Mid Mid Int'l
| Cap Cap Growth Value Cap Value Cap Cap
| --------------------------------------------------------------------------------------------
| Bond Small Bond Bond Large Gold Large Large Mid
| Growth Value Value Value Cap
| --------------------------------------------------------------------------------------------
| Small Gold Small Small Small Int'l Small Int'l Large
| Value Growth Growth Value Growth Value
| ---------------------------------------------------------------------------------------------
| Gold Int'l Int'l Small Bond Large Large Large Large
| Value Growth Growth Growth Growth
| ---------------------------------------------------------------------------------------------
| Int'l Bond Gold Gold Gold Small Int'l Small Bond
| Growth Growth
WORST ---------------------------------------------------------------------------------------------
PERFORMERS
Source: Steele Systems, Inc. Toronto Stock Exchange and Bloomberg.
9
- --------------------------------------------------------------------
MONEY MARKET FUNDS
- --------------------------------------------------------------------
MANAGEMENT TEAM'S PERSPECTIVE
INTRODUCTION
The U.S. Treasury Securities Cash Fund seeks to obtain a high level
of current income while maintaining the highest degree of safety of
principal and liquidity. The U.S. Government Securities Savings Fund
seeks to achieve a consistently high yield with safety of principal.
PERFORMANCE
- --------------------------------------------------------------------
U.S. TREASURY SECURITIES CASH FUND As of December 31, 2003
- --------------------------------------------------------------------
7-Day Yield 0.05%
---------------------------------------------------------------
7-Day Effective Yield 0.05%
---------------------------------------------------------------
Weighted Average Days to Maturity 56
- --------------------------------------------------------------------
- --------------------------------------------------------------------
U.S. GOVERNMENT SECURITIES SAVINGS FUND As of December 31, 2003
- --------------------------------------------------------------------
7-Day Yield 0.61%
---------------------------------------------------------------
7-Day Effective Yield 0.61%
---------------------------------------------------------------
Weighted Average Days to Maturity 60
- --------------------------------------------------------------------
An investment in either the U.S. Government Securities Savings Fund
or the U.S. Treasury Securities Cash Fund is not insured or
guaranteed by the Federal Deposit Insurance Corporation (FDIC) or by
any other government agency. Although the funds seek to preserve the
value of your investments at $1.00 per share, it is possible to lose
money by investing in the funds.
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
In the third quarter of 2003, the economic data generally showed
improving economic fundamentals. Second quarter GDP growth was
revised up to 3.3 percent from original expectations of around 1.5
percent. This allowed the third quarter to get off to a better start
than many anticipated and demonstrated that the recovery was gaining
momentum. In mid-July, Federal Reserve (Fed) Chairman Alan Greenspan
gave his semi-annual congressional testimony and was generally
upbeat on the economy. He also downplayed the likelihood of the use
of "unconventional" measures of monetary policy. Due to this shift
in Fed expectations during the third quarter, bonds experienced
significant volatility, with yields finishing
10
- --------------------------------------------------------------------
MONEY MARKET FUNDS
- --------------------------------------------------------------------
the quarter higher than where they began. After the economy began
showing signs of a soft spot in September, it came roaring back in
October and November. The October and November employment reports
indicated good growth in jobs; initial jobless claims data was
consistently below 400,000. The Fed met in late October and again in
December but did not take any rate action. The Fed also maintained a
constructive outlook on inflation and the economy. A rebound in
manufacturing has been a key driver for growth in the fourth
quarter, as the consumer side has slowed. Third quarter GDP was
revised higher to 8.2 percent, which makes it the strongest quarter
in about 20 years. The yields on the three-month T-Bill rose 2 basis
points to 0.87 percent and yields on the six-month T-Bills were up 3
basis points at 0.97 percent. The Fed is expected to remain
sidelined for the foreseeable future, as they appear comfortable
with the growth and inflation outlook.
INVESTMENT HIGHLIGHTS
The U.S. Government Securities Savings Fund outperformed the Lipper
government-only money market funds for the six months ending
December 31, 2003, returning 0.32 percent versus 0.18 percent
respectively. The U.S. Treasury Securities Cash Fund underperformed
the Lipper treasury money market funds for the six months ending
December 31, 2003, returning 0.04 percent versus 0.16 percent
respectively. However, this particular fund has other features for
investors besides yield, since it offers unlimited free checking.
For much of the period, the U.S. Government Securities Savings Fund
took a laddered approach by buying fixed-rate securities across the
money market spectrum. The fund also reduced its exposure to
floating-rate securities. The fund averaged over the six-month
period a weighted average maturity of 68 days, which was longer than
the peer group average. Yields generally moved higher over this time
with one-year agency bond yields increasing by about 25 to 30 basis
points, while very short term maturities were unchanged. The fund
took advantage of these progressively higher yields by selectively
extending its ladder out through the end of 2004. The U.S. Treasury
Securities Cash Fund followed a similar laddered strategy, averaging
over the six-month period a weighted average maturity of 62 days.
The fund took advantage of short term trading opportunities to add
to positions.
CURRENT OUTLOOK
A year ago the belief was that the next move from the Fed would be
to raise interest rates. The Fed ended up cutting rates by 25 basis
points in
11
- --------------------------------------------------------------------
MONEY MARKET FUNDS
- --------------------------------------------------------------------
June, primarily driven by deflation concerns. Here we are again: the
consensus expectation in the market is for the Fed to raise interest
rates as early as June and by as much as 75 to 100 basis points by
December 2004. These expectations appear too aggressive, as the Fed
appears committed to reflating the economy and actually increasing
inflation. This is also a presidential election year, and
historically the Fed has shied away from making changes before the
election; they don't want to appear to be favoring one candidate
over another. It currently appears unlikely the economy will
generate enough inflation or create enough jobs to force the Fed's
hand before the elections, so it appears any rate increases will
most likely be after the presidential elections in November.
Because of the current low-interest-rate environment, we believe
many investors will seek higher-yielding investments, such as
tax-free municipal bond funds.
12
- --------------------------------------------------------------------
TAX FREE FUNDS
- --------------------------------------------------------------------
MANAGEMENT TEAM'S PERSPECTIVE
INTRODUCTION
The Tax Free and Near-Term Tax Free Funds seek to provide a high
level of current income that is exempt from federal income taxation
and to preserve capital. The Near-Term Tax Free Fund maintains a
weighted average maturity of less than five years, while the Tax
Free Fund generally maintains a longer weighted average maturity.
PERFORMANCE
- ------------------------------------------------------------------------
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------
[Graphic: Line graph created from data points in following tabl]
- --------------------------------------------------------------------------------
Date Near-Term Tax Free Fund Lehman 3 Year Municipal
Bond Index
12/31/93 $10,000.00 $10,000.00
01/31/94 10,065.06 10,080.66
02/28/94 9,962.54 9,986.56
03/31/94 9,803.51 9,866.32
04/29/94 9,822.30 9,924.57
05/31/94 9,860.00 9,970.87
06/30/94 9,869.46 9,973.86
07/29/94 9,954.95 10,056.76
08/31/94 9,983.53 10,092.61
09/30/94 9,973.97 10,067.22
10/31/94 9,954.79 10,042.57
11/30/94 9,925.94 10,024.65
12/30/94 9,993.52 10,067.96
01/31/95 10,061.31 10,151.61
02/28/95 10,119.58 10,258.40
03/31/95 10,187.82 10,350.26
04/28/95 10,217.18 10,385.36
05/31/95 10,325.25 10,544.44
06/30/95 10,364.70 10,569.83
07/31/95 10,424.09 10,681.11
08/31/95 10,473.73 10,764.75
09/29/95 10,503.63 10,795.37
10/31/95 10,543.64 10,846.90
11/30/95 10,613.93 10,916.36
12/29/95 10,644.17 10,961.17
01/31/96 10,725.27 11,047.05
02/29/96 10,725.27 11,049.29
03/29/96 10,674.25 11,022.41
04/30/96 10,674.25 11,035.85
05/31/96 10,684.52 11,045.56
06/28/96 10,746.40 11,111.28
07/31/96 10,808.52 11,173.26
08/30/96 10,839.70 11,189.69
09/30/96 10,912.73 11,257.66
10/31/96 10,986.04 11,336.07
11/29/96 11,101.68 11,442.12
12/31/96 11,101.68 11,447.35
01/31/97 11,144.09 11,497.39
02/28/97 11,205.83 11,553.40
03/31/97 11,131.05 11,493.65
04/30/97 11,185.74 11,542.94
05/30/97 11,290.17 11,637.04
06/30/97 11,375.52 11,705.75
07/31/97 11,565.29 11,844.66
08/29/97 11,505.45 11,821.51
09/30/97 11,613.52 11,905.90
10/31/97 11,663.92 11,958.93
11/28/97 11,701.30 11,993.28
12/31/97 11,823.71 12,074.68
01/30/98 11,918.92 12,154.59
02/27/98 11,913.37 12,179.99
03/31/98 11,908.91 12,199.40
04/30/98 11,893.26 12,182.97
05/29/98 12,022.29 12,295.74
06/30/98 12,060.56 12,336.82
07/31/98 12,096.83 12,381.63
08/31/98 12,233.39 12,501.87
09/30/98 12,352.19 12,581.03
10/30/98 12,346.46 12,642.27
11/30/98 12,364.84 12,672.89
12/31/98 12,371.75 12,703.51
01/29/99 12,480.44 12,818.52
02/26/99 12,450.28 12,832.71
03/31/99 12,460.75 12,843.91
04/30/99 12,500.46 12,883.50
05/28/99 12,465.31 12,864.82
06/30/99 12,344.30 12,787.90
07/30/99 12,403.25 12,851.38
08/31/99 12,365.38 12,867.07
09/30/99 12,399.83 12,915.61
10/29/99 12,377.20 12,917.10
11/30/99 12,446.49 12,973.86
12/31/99 12,421.31 12,952.95
01/31/00 12,405.66 12,976.10
02/29/00 12,446.73 13,017.18
03/31/00 12,550.96 13,084.39
04/28/00 12,518.12 13,085.89
05/31/00 12,504.70 13,099.33
06/30/00 12,671.27 13,265.12
07/31/00 12,788.02 13,372.63
08/31/00 12,900.24 13,473.66
09/29/00 12,894.05 13,477.55
10/31/00 12,977.28 13,553.97
11/30/00 13,034.63 13,608.37
12/31/00 13,227.27 13,759.92
01/31/01 13,365.31 13,968.77
02/28/01 13,394.29 14,023.41
03/30/01 13,481.48 14,121.98
04/30/01 13,424.40 14,101.35
05/31/01 13,533.84 14,229.80
06/30/01 13,584.91 14,293.17
07/31/01 13,706.54 14,410.34
08/31/01 13,852.99 14,558.29
09/30/01 13,891.65 14,632.57
10/31/01 13,989.86 14,727.74
11/30/01 13,899.10 14,680.71
12/31/01 13,837.99 14,666.70
01/31/02 14,023.19 14,852.97
02/28/02 14,140.92 14,964.36
03/31/02 13,927.10 14,741.39
04/30/02 14,171.95 14,958.09
05/31/02 14,239.31 15,044.85
06/30/02 14,351.90 15,174.23
07/31/02 14,472.71 15,292.59
08/31/02 14,604.52 15,390.47
09/30/02 14,798.09 15,512.05
10/31/02 14,661.62 15,426.73
11/30/02 14,625.40 15,431.36
12/31/02 14,833.76 15,653.57
01/31/03 14,856.66 15,703.67
02/28/03 14,993.08 15,804.17
03/31/03 14,990.37 15,785.20
04/30/03 15,050.06 15,827.82
05/31/03 15,259.43 15,949.70
06/30/03 15,209.02 15,924.18
07/31/03 14,912.76 15,780.86
08/31/03 15,015.37 15,861.34
09/30/03 15,299.22 16,099.26
10/31/03 15,226.36 16,023.60
11/30/03 15,271.84 16,039.62
12/31/03 15,324.31 16,073.30
- --------------------------------------------------------------------------------
- ------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2003
- ------------------------------------------------------------------------
Six Month One Year Five Year Ten Year
Near-Term Tax Free Fund 0.76% 3.31% 4.37% 4.36%
----------------------------------------------------------------------
Lehman 3-Year Municipal Bond
Index 0.94% 2.68% 4.82% 4.86%
Performance data quoted represent past performance. Investment return
and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
The graph and table do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
The Lehman Brothers 3-Year Municipal Bond Index is a total return
benchmark designed for municipal assets. The index includes bonds with
a minimum credit rating of BAA3, are issued as part of a deal of at
least 50 million, have an amount outstanding of at least 5 million and
have a maturity of two to four years.
The Adviser has agreed to limit the fund's total operating expenses to
.45% for the year ended June 30, 2004.
- ------------------------------------------------------------------------
13
- ------------------------------------------------------------------------
TAX FREE FUNDS
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
TAX FREE FUND
- ------------------------------------------------------------------------
[Graphics: Line graph created from data points in the following table]
- --------------------------------------------------------------------------------
Tax Free Fund Lehman 10-Year Municipal Bond Fund
Date
12/31/93 $10,000.00 $10,000.00
01/31/94 10,106.21 10,122.74
02/28/94 9,884.73 9,845.40
03/31/94 9,513.74 9,469.51
04/29/94 9,546.89 9,573.66
05/31/94 9,638.53 9,650.08
06/30/94 9,596.65 9,608.47
07/29/94 9,748.18 9,769.86
08/31/94 9,798.91 9,807.63
09/30/94 9,679.93 9,675.74
10/31/94 9,492.13 9,534.42
11/30/94 9,260.62 9,354.14
12/30/94 9,476.18 9,522.62
01/31/95 9,737.23 9,769.27
02/28/95 9,947.01 10,045.73
03/31/95 10,078.70 10,181.45
04/28/95 10,105.16 10,193.85
05/31/95 10,361.99 10,517.22
06/30/95 10,317.52 10,451.72
07/31/95 10,371.12 10,605.14
08/31/95 10,469.72 10,749.12
09/29/95 10,541.74 10,817.87
10/31/95 10,668.31 10,942.67
11/30/95 10,804.50 11,089.61
12/29/95 10,904.80 11,157.47
01/31/96 10,968.89 11,270.47
02/29/96 10,913.72 11,224.15
03/29/96 10,784.46 11,084.59
04/30/96 10,756.66 11,045.35
05/31/96 10,765.97 11,014.37
06/28/96 10,859.42 11,119.11
07/31/96 10,953.20 11,225.62
08/30/96 10,953.20 11,225.92
09/30/96 11,085.62 11,341.28
10/31/96 11,180.53 11,484.67
11/29/96 11,352.10 11,717.17
12/31/96 11,323.39 11,664.36
01/31/97 11,361.84 11,710.38
02/28/97 11,456.44 11,820.73
03/31/97 11,348.85 11,662.29
04/30/97 11,445.21 11,748.15
05/30/97 11,589.86 11,914.56
06/30/97 11,720.38 12,046.15
07/31/97 12,011.18 12,384.56
08/29/97 11,909.27 12,264.48
09/30/97 12,039.39 12,419.97
10/31/97 12,096.24 12,485.76
11/28/97 12,167.34 12,543.59
12/31/97 12,352.21 12,741.57
01/30/98 12,460.19 12,882.90
02/27/98 12,443.98 12,882.01
03/31/98 12,431.78 12,873.16
04/30/98 12,379.73 12,802.35
05/29/98 12,580.59 13,020.09
06/30/98 12,623.79 13,067.89
07/31/98 12,664.15 13,088.84
08/31/98 12,863.62 13,316.32
09/30/98 13,015.94 13,514.30
10/30/98 12,971.96 13,520.20
11/30/98 13,031.87 13,560.62
12/31/98 13,045.59 13,602.81
01/29/99 13,198.45 13,811.11
02/26/99 13,111.09 13,687.19
03/31/99 13,133.53 13,680.11
04/30/99 13,170.02 13,716.70
05/28/99 13,053.72 13,620.51
06/30/99 12,798.69 13,367.36
07/30/99 12,824.72 13,457.06
08/31/99 12,660.33 13,407.49
09/30/99 12,655.96 13,452.63
10/29/99 12,451.80 13,357.63
11/30/99 12,603.86 13,503.67
12/31/99 12,467.75 13,433.45
01/31/00 12,341.74 13,378.57
02/29/00 12,515.33 13,483.61
03/31/00 12,848.17 13,745.91
04/28/00 12,747.69 13,676.87
05/31/00 12,642.31 13,595.73
06/30/00 12,999.61 13,965.13
07/31/00 13,185.81 14,158.86
08/31/00 13,388.76 14,377.82
09/29/00 13,288.60 14,312.00
10/31/00 13,459.62 14,458.42
11/30/00 13,568.69 14,536.34
12/31/00 13,932.08 14,878.89
01/31/01 14,059.47 15,070.96
02/28/01 14,082.95 15,096.25
03/30/01 14,206.58 15,224.97
04/30/01 14,022.21 15,036.35
05/31/01 14,166.94 15,200.02
06/30/01 14,275.27 15,290.42
07/31/01 14,480.74 15,501.12
08/31/01 14,724.08 15,763.85
09/30/01 14,659.12 15,743.20
10/31/01 14,834.07 15,937.52
11/30/01 14,652.43 15,731.23
12/31/01 14,462.89 15,566.30
01/31/02 14,722.64 15,860.50
02/28/02 14,913.56 16,087.30
03/31/02 14,584.60 15,755.91
04/30/02 14,911.03 16,121.44
05/31/02 14,987.68 16,197.21
06/30/02 15,157.66 16,398.06
07/31/02 15,338.11 16,616.15
08/31/02 15,496.74 16,832.16
09/30/02 15,809.93 17,234.45
10/31/02 15,549.78 16,920.79
11/30/02 15,457.72 16,782.03
12/31/02 15,765.10 17,149.56
01/31/03 15,714.33 17,058.67
02/28/03 15,915.21 17,353.78
03/31/03 15,898.64 17,362.46
04/30/03 16,003.44 17,490.94
05/31/03 16,378.86 17,991.18
06/30/03 16,292.79 17,904.83
07/31/03 15,656.54 17,152.82
08/31/03 15,789.59 17,300.34
09/30/03 16,223.51 17,883.36
10/31/03 16,126.09 17,747.45
11/30/03 16,243.33 17,939.12
12/31/03 16,346.48 18,129.27
- --------------------------------------------------------------------------------
- ------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2003
- ------------------------------------------------------------------------
Six Month One Year Five Year Ten Year
Tax Free Fund 0.33% 3.69% 4.61% 5.03%
----------------------------------------------------------------------
Lehman 10-Year Municipal
Bond Index 1.25% 5.71% 5.91% 6.13%
Performance data quoted represent past performance. Investment return
and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
The graph and table do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
The Lehman Brothers 10-Year Municipal Bond Index is a total return
benchmark designed for long-term municipal assets. The index includes
bonds with a minimum credit rating of BAA3, are issued as part of a
deal of at least 50 million, have an amount outstanding of at least 5
million and have a maturity of 8 to 12 years.
The Adviser has agreed to limit the fund's total operating expenses to
.70% for the year ended June 30, 2004.
- ------------------------------------------------------------------------
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
Municipals have maintained their momentum over the past six months,
with returns ranging between about 50 basis points to 175 basis
points. Returns were as you would expect, with the long end of the
curve posting the best performance, while the short end lagged.
During the past six months, yields rose across the board. The short
end of the yield curve saw increases by as much as 25 basis points
while long-term municipals saw yield increases of about 15 basis
points. The Bond Buyer 40 Municipal Bond Index,(1) which represents
long-term municipal bonds, increased by
14
- ------------------------------------------------------------------------
TAX FREE FUNDS
- ------------------------------------------------------------------------
14 basis points, from approximately 4.66 percent to 4.80 percent.
Volatility was high, with a brutal sell-off in July--in retrospect,
this created an excellent opportunity to buy--only to rally steadily
from August through December, approaching the levels last seen in
early July. Of the sectors of the municipal market, the tobacco and
airline sectors had the largest impact on performance. The
industrial development sector, which includes tobacco bonds, and the
high-yield sector, which includes airlines, both experienced total
returns in excess of 6 percent, much greater than the approximately
1.5 percent gain for the municipal market as a whole. Municipal
supply remained robust, capping off a record year, but demand from
investors was just as strong. The Fed left interest rates unchanged
and appears comfortable with the growth and inflation outlook.
INVESTMENT HIGHLIGHTS
The Near-Term Tax Free Fund posted a 0.76 percent return in the past
six months, compared to 1.09 percent for the Lipper
Short-Intermediate Municipal Debt Funds peer group. The Tax Free
Fund returned 0.33 percent for the past six months compared to 1.38
percent for the Lipper General Municipal Debt Funds peer group.
In the past six months, industrial development and hospital bonds
were the best revenue bond performers, while education and water and
sewer issues lagged. The industrial development sector was driven by
tobacco-backed bonds, which outperformed the second-best-performing
hospital group by 4 percent. The Tax Free Fund was conservatively
positioned due to the ambiguous interest rate outlook.
On a maturity basis, the fund was underweight compared to its
benchmark and took less interest rate risk, which was unfavorable to
overall total return. The fund's lack of exposure to risky airline
and tobacco-backed bonds caused its performance to lag the
performance of its peer group who invested in these bonds, as these
two sectors were by far the best performers over the past six
months. The Near-Term Tax Free Fund's shorter maturity structure was
not as much of an issue, as maturities are more uniform across the
peer group.
Both funds followed a similar strategy of reducing interest rate
exposure throughout the past six months and adding to lower quality
credits with higher yields. The funds ended the year with a balanced
portfolio from both a credit and interest-rate standpoint. Both
funds maintained a diverse mix of issuers, credit, sector and
geographic locale.
15
- ------------------------------------------------------------------------
TAX FREE FUND
- ------------------------------------------------------------------------
CURRENT OUTLOOK
The economic outlook is for a transition from a recovering economy
into a full-blown expansion. But at the same time, inflation has
been remarkably tame. Before committing to a more aggressive
strategy, we will wait for more confirmation from the economic and
inflation data that will trigger the Fed to move. The Fed appears to
be on hold for at least the next six months, possibly not even until
2005.
(1)The Bond Buyer Municipal Bond Index is based on prices for 40
long-term municipal bonds. The index is calculated by taking
price estimates from Standard & Poor's Securities Evaluations for
the 40 bonds, converting them to fit a standard 6 percent coupon,
averaging the converted prices, and multiplying the result by a
smoothing coefficient that compensates for the changes made twice
a month in the index's composition.
- ------------------------------------------------------------------------
MUNICIPAL BOND RATINGS December 31, 2003
(BASED ON TOTAL INVESTMENTS)
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------
AAA 37.23%
---------------------------------------------------------------
AA 32.37%
---------------------------------------------------------------
A 17.68%
---------------------------------------------------------------
BBB 9.20%
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
TAX FREE FUND
- ------------------------------------------------------------------------
AAA 40.12%
---------------------------------------------------------------
AA 36.13%
---------------------------------------------------------------
A 14.51%
---------------------------------------------------------------
BBB 8.62%
- ------------------------------------------------------------------------
16
- ------------------------------------------------------------------------
ALL AMERICAN EQUITY FUND
- ------------------------------------------------------------------------
MANAGEMENT TEAM'S PERSPECTIVE
INTRODUCTION
The principal objective of the All American Equity Fund is to seek
capital appreciation by investing primarily in a broadly diversified
portfolio of domestic common stocks. The fund invests in
large-capitalization stocks, while retaining the flexibility to seek
out promising small- and mid-cap stock opportunities. The fund seeks
capital appreciation and does not emphasize income.
PERFORMANCE
- ------------------------------------------------------------------------
ALL AMERICAN EQUITY FUND
- ------------------------------------------------------------------------
[Graphics: Line Graph Created from the data points in the following tabel]
- --------------------------------------------------------------------------------
All American Equity Fund S&P 500 Total Return Index
Date
12/31/93 $10,000.00 $10,000.00
01/31/94 10,255.56 10,339.97
02/28/94 10,075.72 10,059.33
03/31/94 9,583.53 9,620.77
04/29/94 9,750.32 9,744.14
05/31/94 9,650.25 9,904.05
06/30/94 9,345.25 9,661.28
07/29/94 9,666.02 9,978.53
08/31/94 9,972.42 10,387.64
09/30/94 9,689.95 10,133.63
10/31/94 9,781.32 10,361.30
11/30/94 9,382.18 9,983.88
12/30/94 9,468.74 10,132.05
01/31/95 9,636.96 10,394.81
02/28/95 9,908.27 10,799.91
03/31/95 10,157.87 11,118.58
04/28/95 10,458.08 11,445.98
05/31/95 10,807.41 11,903.46
06/30/95 11,025.74 12,179.95
07/31/95 11,305.78 12,583.87
08/31/95 11,256.36 12,615.50
09/29/95 11,739.56 13,147.89
10/31/95 11,772.69 13,100.90
11/30/95 12,208.92 13,676.02
12/29/95 12,391.14 13,939.44
01/31/96 12,773.35 14,413.89
02/29/96 12,911.83 14,547.52
03/29/96 13,011.53 14,687.56
04/30/96 13,200.59 14,904.10
05/31/96 13,612.06 15,288.47
06/28/96 13,706.59 15,346.80
07/31/96 13,232.03 14,668.76
08/30/96 13,416.27 14,978.19
09/30/96 14,097.41 15,821.24
10/31/96 14,389.01 16,257.60
11/29/96 15,403.97 17,486.46
12/31/96 15,151.63 17,139.98
01/31/97 16,191.57 18,210.79
02/28/97 16,208.99 18,353.53
03/31/97 15,583.87 17,599.73
04/30/97 16,644.95 18,650.08
05/30/97 17,583.60 19,785.55
06/30/97 18,323.44 20,671.98
07/31/97 19,446.00 22,316.80
08/29/97 18,446.22 21,066.57
09/30/97 19,288.72 22,220.32
10/31/97 18,696.58 21,478.22
11/28/97 19,435.30 22,472.50
12/31/97 19,743.09 22,858.44
01/30/98 20,130.45 23,111.27
02/27/98 21,387.86 24,778.16
03/31/98 22,378.29 26,047.02
04/30/98 22,718.80 26,309.08
05/29/98 22,390.24 25,856.88
06/30/98 23,327.54 26,907.16
07/31/98 23,255.40 26,620.64
08/31/98 20,207.18 22,771.90
09/30/98 21,492.00 24,230.68
10/30/98 22,848.06 26,201.65
11/30/98 24,276.44 27,789.68
12/31/98 25,437.10 29,391.06
01/29/99 26,342.47 30,620.08
02/26/99 25,548.72 29,668.45
03/31/99 26,205.42 30,855.44
04/30/99 26,852.16 32,050.33
05/28/99 26,410.64 31,293.45
06/30/99 27,873.26 33,030.21
07/30/99 26,933.37 31,998.85
08/31/99 26,584.80 31,840.54
09/30/99 25,773.12 30,967.67
10/29/99 27,325.49 32,927.32
11/30/99 27,724.50 33,596.68
12/31/99 29,153.43 35,575.39
01/31/00 27,697.66 33,788.00
02/29/00 27,102.69 33,148.40
03/31/00 29,483.83 36,391.11
04/28/00 28,755.28 35,296.41
05/31/00 27,931.71 34,572.23
06/30/00 28,632.38 35,424.55
07/31/00 27,865.55 34,870.71
08/31/00 29,716.08 37,036.69
09/29/00 27,504.32 35,081.40
10/31/00 26,503.01 34,933.09
11/30/00 23,534.42 32,178.98
12/31/00 23,670.24 32,336.48
01/31/01 23,872.55 33,483.74
02/28/01 20,967.38 30,430.64
03/30/01 19,480.00 28,502.84
04/30/01 21,278.90 30,717.81
05/31/01 21,157.36 30,923.62
06/30/01 20,626.60 30,170.98
07/31/01 20,156.34 29,873.97
08/31/01 18,640.15 28,003.81
09/30/01 17,813.95 25,742.43
10/31/01 18,024.87 26,233.31
11/30/01 19,111.87 28,245.57
12/31/01 19,160.55 28,493.02
01/31/02 18,511.59 28,077.22
02/28/02 18,057.31 27,535.74
03/31/02 18,884.74 28,571.34
04/30/02 17,943.75 26,839.12
05/31/02 19,201.11 26,641.39
06/30/02 17,197.44 24,743.47
07/31/02 14,926.08 22,814.84
08/31/02 15,201.89 22,964.63
09/30/02 13,863.41 20,468.85
10/31/02 14,552.93 22,270.44
11/30/02 14,609.71 23,581.26
12/31/02 14,066.21 22,195.91
01/31/03 13,879.63 21,614.46
02/28/03 13,652.50 21,290.16
03/31/03 13,855.30 21,496.86
04/30/03 14,901.75 23,267.57
05/31/03 15,566.93 24,493.47
06/30/03 15,534.48 24,805.93
07/31/03 15,915.75 25,243.29
08/31/03 16,459.25 25,735.60
09/30/03 16,232.11 25,462.30
10/31/03 17,448.91 26,902.70
11/30/03 18,073.54 27,139.40
12/31/03 18,471.03 28,562.71
- --------------------------------------------------------------------------------
- ------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2003
- ------------------------------------------------------------------------
Six Month One Year Five Year Ten Year
All American Equity Fund 18.90% 31.31% (6.20)% 6.32%
----------------------------------------------------------------------
S&P 500 Total Return Index 15.14% 28.68% (0.57)% 11.07%
Performance data quoted represent past performance. Investment return
and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
The graph and table do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
The S&P 500 Total Return Index is a widely recognized
capitalization-weighted index of 500 common stock prices in U.S.
companies.
The Adviser has agreed to limit the fund's total operating expenses to
1.75% for the year ended June 30, 2004.
- ------------------------------------------------------------------------
17
- ------------------------------------------------------------------------
ALL AMERICAN EQUITY FUND
- ------------------------------------------------------------------------
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
Developed economies across the globe finally experienced the rebound
seemingly astute academics and investors had predicted for the past
several years. The song and dance from investment strategists over
the last few years has been that the back half of the year would
improve from the conditions prevalent during the first two quarters
of the year. Those past calls on the markets never quite
materialized as investors wished. The second half of 2003 changed
that trend and proved correct the old adage that "even a broken
clock will be correct at some point in time."
Much to the delight of investors, economic reports painted the
picture of an improving economy entering 2004. General trends
witnessed by the market included falling jobless claims, GDP growth
of 8.2 percent in the third quarter and signs of a turnaround in the
manufacturing sector. The strengthening manufacturing sector offers
the most promising outlook for an economy that has relied solely on
consumer pocketbooks for almost three years.
Our firm entered 2003 looking to take advantage of the effects of
the presidential election cycle on our economy and markets. We were
not disappointed. History tells us that the third year of a
president's term tends to be the best for stock returns. This is the
effect of the incumbent's reelection efforts, which include generous
spending programs and easy monetary policy. George W. Bush followed
historical patterns by spending enormous amounts on missions ranging
from the war in Iraq to recent talk of an increased space
exploration budget. The President supplemented his spending packages
with a federal income tax cut and a cut in dividend tax rates. The
markets reacted in kind to the appearance of an improving economy,
gaining close to 30 percent in 2003.
INVESTMENT HIGHLIGHTS
The fund finished the six-month period ending December 31, 2003 with
a return of 18.90 percent. The fund outperformed the S&P 500 Total
Return Index by over 3 percent during the second half of 2003. The
benchmark S&P 500 Total Return Index ended the same six-month period
with a gain of 15.14 percent.
The past six months were dominated by cyclical sectors in the
market. Gains were notably concentrated in the fourth quarter
following several months of summer consolidation.
Basic materials stocks led the market higher over the past six
months in spite of strong energy prices that continued to plague
margins. The sector
18
- ------------------------------------------------------------------------
ALL AMERICAN EQUITY FUND
- ------------------------------------------------------------------------
was up almost 30 percent during the second half of the year. The
gains in materials can largely be tied to investor expectations for
an improving economy, which would improve volume sales and
eventually lead to pricing power for most companies.
The diverse metals and mining industry group was the highlight of
the market, with gains of more than 84 percent during the same
period. Base and precious metal commodity price gains outdistanced
all expectations, driven largely by strong Chinese consumption,
which tightened the supply markets.
The technology sector also enjoyed a strong rally in the second half
of 2003. The sector was up close to 25 percent over that time
period. Semiconductors, electronic manufacturing services and
communications equipment all enjoyed stock price gains that outpaced
the market. Increased demand and higher utilization rates were cited
as important factors improving sentiment. The pickup in performance
of capital spending industries is very encouraging for the economy
in 2004.
Defensive sectors lagged the broader market during the second half
of the year. Consumer staples, utilities, healthcare and
telecommunications all struggled to notch any gains. With regard to
investor interest, the demarcation of performance between these four
defensive sectors of the market and the remaining cyclical groups is
dramatic and telling.
CURRENT OUTLOOK
U.S. Global Investors continues to believe the presidential election
cycle will be a strong force in the economy through at least our
fiscal year end of June 2004. As this is being printed, the
Democratic presidential candidates are jockeying for position in the
primaries around the country to face the incumbent president. The
President's policies of cutting taxes, while sharply increasing
spending, will definitely leave him open for attack from his
opponent. With that in mind, we believe the president will continue
doing his best to keep American voters happy through strong
financial markets and liberal spending policies.
It is our opinion that cyclical market sectors will continue to
offer investors the most capital appreciation potential over the
next six months. Our expectation is founded on continued low
interest rates with little impetus from the Federal Reserve to move
them higher until late 2004 and higher earnings revisions from the
market. We continue to favor basic materials, energy, industrials
and information technology.
19
- ------------------------------------------------------------------------
ALL AMERICAN EQUITY FUND
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2003
- ------------------------------------------------------------------------
WHEATON RIVER MINERALS LTD. 2.87%
METAL & MINERAL MINING
---------------------------------------------------------------
FREEPORT-MCMORAN COPPER & GOLD, INC. 2.81%
METAL & MINERAL MINING
---------------------------------------------------------------
CISCO SYSTEMS, INC. 2.49%
COMPUTER & OFFICE EQUIPMENT
---------------------------------------------------------------
CITIGROUP, INC. 2.04%
FINANCIAL SERVICES
---------------------------------------------------------------
GENERAL ELECTRIC CO. 1.99%
HOUSEHOLD APPLIANCES
---------------------------------------------------------------
ENERPLUS RESOURCES FUND 1.96%
OIL & GAS ROYALTY TRUSTS
---------------------------------------------------------------
UCBH HOLDINGS, INC. 1.93%
BANKS
---------------------------------------------------------------
MICROSOFT CORP. 1.81%
DATA PROCESSING & SOFTWARE
---------------------------------------------------------------
LEGG MASON, INC. 1.61%
FINANCIAL SERVICES
---------------------------------------------------------------
TEXAS INSTRUMENTS, INC. 1.59%
ELECTRONICS & COMPONENTS
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS December 31, 2003
- ------------------------------------------------------------------------
FINANCIAL SERVICES 9.73%
METAL & MINERAL MINING 9.71%
BANKS 6.98%
ELECTRONICS & COMPONENTS 6.40%
DATA PROCESSING & SOFTWARE 5.26%
20
- ---------------------------------------------------------------------------
CHINA REGION OPPORTUNITY FUND
- ---------------------------------------------------------------------------
MANAGEMENT TEAM'S PERSPECTIVE
INTRODUCTION
The China Region Opportunity Fund seeks to achieve capital
appreciation by focusing on the economic growth in the greater China
region, including China, Hong Kong, Singapore, Korea, Taiwan and
other Asian countries. The fund emphasizes a long-term growth
approach over current income.
PERFORMANCE
- ---------------------------------------------------------------------------
CHINA REGION OPPORTUNITY FUND
- ---------------------------------------------------------------------------
[Graphics: Line chart created from data points on the following table]
- --------------------------------------------------------------------------------
Date China Region IFC Emerging Mkts Morgan Stanley Capital
Opportunity Fund Investable Total China Index Far East ex Japan
02/10/94 $10,000.00 10,000.00 $10,000.00
02/28/94 9,465.73 9,499.49 9,551.08
03/31/94 8,155.24 7,780.03 8,490.13
04/29/94 8,094.61 7,383.05 8,869.29
05/31/94 8,417.99 7,811.94 9,236.91
06/30/94 7,852.07 6,846.73 8,810.82
07/29/94 8,267.47 7,713.08 9,290.36
08/31/94 8,774.06 8,243.17 10,031.62
09/30/94 8,834.85 8,451.00 9,852.95
10/31/94 8,662.41 8,348.25 10,033.37
11/30/94 7,698.79 7,095.04 9,063.76
12/30/94 7,191.63 6,089.36 8,827.13
01/31/95 6,430.88 5,174.75 7,870.07
02/28/95 6,735.18 5,760.10 8,654.74
03/31/95 6,714.89 5,854.28 8,671.05
04/28/95 6,441.02 5,129.60 8,571.18
05/31/95 7,019.19 5,897.87 9,601.52
06/30/95 6,846.75 5,744.53 9,444.68
07/31/95 7,072.58 6,009.19 9,578.68
08/31/95 6,990.46 5,728.96 9,108.18
09/29/95 6,939.14 5,604.42 9,254.15
10/31/95 6,692.41 5,293.06 9,101.13
11/30/95 6,312.05 4,787.11 8,993.15
12/29/95 6,178.40 4,538.02 9,428.35
01/31/96 6,642.56 5,160.74 10,279.74
02/29/96 6,766.33 5,308.63 10,229.73
03/29/96 6,580.67 5,028.41 10,292.74
04/30/96 6,549.73 4,966.14 10,562.24
05/31/96 6,621.93 5,098.47 10,441.52
06/28/96 6,704.44 5,082.90 10,216.98
07/31/96 6,621.03 4,942.79 9,463.10
08/30/96 6,631.46 5,145.17 9,787.08
09/30/96 6,662.74 5,121.82 10,021.83
10/31/96 6,683.69 5,075.11 9,821.01
11/29/96 7,207.49 5,549.93 10,371.41
12/31/96 7,898.91 6,389.04 10,294.10
01/31/97 7,877.95 6,333.00 10,430.05
02/28/97 8,097.95 6,509.69 10,458.58
03/31/97 7,982.71 6,302.64 9,861.28
04/30/97 8,454.13 7,219.58 9,595.14
05/30/97 8,894.13 7,121.51 10,061.65
06/30/97 9,009.36 7,205.57 10,313.79
07/31/97 9,679.83 8,320.23 10,344.53
08/29/97 9,795.06 9,643.50 8,425.13
09/30/97 9,239.83 7,651.59 8,349.90
10/31/97 7,018.92 6,274.62 6,298.96
11/28/97 6,337.98 4,963.03 5,888.33
12/31/97 6,125.32 4,863.39 5,612.00
01/30/98 4,784.09 3,457.62 5,127.85
02/27/98 6,114.76 4,755.97 8,803.44
03/31/98 6,114.76 4,464.86 6,128.88
04/30/98 5,618.40 3,914.53 5,486.21
05/29/98 4,984.74 3,636.65 4,621.67
06/30/98 4,319.41 3,234.22 4,105.39
07/31/98 3,654.07 2,512.65 3,981.03
08/31/98 3,009.85 1,952.21 3,354.65
09/30/98 3,654.07 2,601.39 3,707.66
10/30/98 4,150.43 2,583.48 4,712.38
11/30/98 4,277.16 2,621.62 5,133.05
12/31/98 4,087.07 2,388.11 5,197.41
01/29/99 3,576.18 2,084.53 5,020.07
02/26/99 3,554.90 2,102.44 4,922.54
03/31/99 3,938.06 2,204.41 5,458.13
04/30/99 4,757.60 2,833.35 6,711.58
05/28/99 4,640.52 2,755.51 6,400.84
06/30/99 5,939.02 3,771.31 7,500.11
07/30/99 5,641.00 3,620.30 7,199.74
08/31/99 5,672.93 3,674.79 7,310.05
09/30/99 5,374.92 3,489.53 6,718.43
10/29/99 5,321.70 3,484.08 7,034.68
11/30/99 5,896.44 4,462.52 7,730.04
12/31/99 6,364.75 4,901.53 8,284.71
01/31/00 6,396.68 4,940.45 8,095.96
02/29/00 6,822.42 6,195.22 7,661.11
03/31/00 7,088.51 6,234.14 8,004.52
04/28/00 6,364.75 5,308.63 7,343.35
05/31/00 6,024.17 5,370.90 6,737.02
06/30/00 6,503.12 6,188.22 7,041.35
07/31/00 6,535.05 6,111.93 6,779.25
08/31/00 6,396.68 5,990.50 6,687.44
09/29/00 5,864.51 5,323.42 5,906.68
10/31/00 5,342.99 5,075.89 5,438.96
11/30/00 5,055.62 4,370.67 5,161.70
12/31/00 5,163.11 4,455.52 5,146.77
01/31/01 5,378.69 4,948.24 5,835.14
02/28/01 5,109.22 4,661.79 5,548.94
03/30/01 5,066.10 4,196.31 4,941.16
04/30/01 5,270.90 4,728.73 4,948.61
05/31/01 5,443.37 5,011.29 4,900.15
06/30/01 5,303.24 5,098.47 4,788.81
07/31/01 4,861.30 4,421.27 4,597.80
08/31/01 4,484.04 3,550.25 4,514.99
09/30/01 3,977.43 3,382.89 3,790.90
10/31/01 4,128.34 3,432.71 3,980.55
11/30/01 4,419.37 3,670.90 4,522.80
12/31/01 4,484.04 3,658.44 4,931.32
01/31/02 4,591.83 3,396.90 5,129.93
02/28/02 4,537.94 3,459.17 5,137.94
03/31/02 4,764.29 3,627.31 5,500.99
04/30/02 4,893.64 3,726.16 5,566.06
05/31/02 4,882.86 3,749.51 5,438.33
06/30/02 4,721.18 3,656.88 5,138.84
07/31/02 4,408.59 3,508.99 4,940.50
08/31/02 4,246.90 3,442.05 4,822.76
09/30/02 3,891.20 3,190.63 4,266.07
10/31/02 3,923.54 3,164.16 4,492.69
11/30/02 4,106.78 3,301.94 4,713.16
12/31/02 3,934.31 3,199.19 4,386.41
01/31/03 4,052.88 3,371.22 4,438.16
02/28/03 4,052.88 3,299.60 4,220.30
03/31/03 3,880.42 3,172.73 4,017.99
04/30/03 3,901.98 3,183.62 4,145.27
05/31/03 4,343.91 3,563.48 4,483.38
06/30/03 4,494.82 3,795.44 4,736.07
07/31/03 4,915.20 4,159.73 5,130.89
08/31/03 5,292.46 4,421.27 5,493.14
09/30/03 5,464.92 4,452.40 5,506.49
10/31/03 6,402.69 5,104.69 5,969.03
11/30/03 6,585.93 5,204.33 5,873.55
12/31/03 7,126.40 5,885.42 6,174.88
- ------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2003
- ---------------------------------------------------------------------------
Six Month One Year Five Year Inception
China Region Opportunity
Fund (Inception 02/10/94) 58.55% 81.13% 11.75% (3.37)%
-------------------------------------------------------------------------
Hang Seng Composite Index 38.70% 50.52% n/a n/a
-------------------------------------------------------------------------
Morgan Stanley Capital Far
East Free ex Japan Index* 30.38% 40.77% 3.51% (4.76)%
-------------------------------------------------------------------------
IFC Emerging Markets Invest-
able Total China Index 55.07% 83.97% 19.77% (5.22)%
<FN>
*These are not total returns. These returns reflect simple appreciation
only and do not reflect dividend reinvestment.
Performance data quoted represent past performance. Investment return and
principal value of an investment will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than their original
cost.
The graph and table do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
The Hang Seng Composite Index is a market-capitalization weighted index
that comprises the top 200 companies listed on the Stock Exchange of Hong
Kong, based on average market capitalization for the twelve months. The
index commenced January 2000; it is not included in the graph as data is
not available for the entire period since fund inception. The Morgan
Stanley Capital Far East Free ex Japan Index is an index in a series
representing both the developed and the emerging markets for a particular
region. The IFC Emerging Markets Investable Total China Index represents
the S&P China Investable Total Return series. The term "investable"
indicates that the stocks and the weights in the S&P Index represents the
amount that the foreign institutional investors might buy by the virtue
of the foreign institutional restrictions, plus factoring in minimum
market capitalization and liquidity screens.
- ---------------------------------------------------------------------------
</FN>
21
- ---------------------------------------------------------------------------
CHINA REGION OPPORTUNITY FUND
- ---------------------------------------------------------------------------
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
China's economy continued to grow rapidly in the second half of
2003. December export growth hit a record high of 50.7 percent.
Import growth was also impressive, jumping 47.4 percent, indicating
strong domestic demand. For the calendar 2003 year, China's GDP grew
9.1 percent.
Basic materials and energy were the two hottest sectors as booming
Chinese demand supported commodities prices. In Hong Kong, positive
policy changes helped the retail and property sectors. China opened
access to Hong Kong for mainlanders, which meant improved demand for
the retailers. Also, opening up residential property purchases in
Hong Kong to mainlanders lifted the property development sector
higher.
Tension between China and Taiwan worsened due to talks on the
referendum law in Taiwan. The fear was that Taiwan would use the
referendum law as a way to declare independence from China. China
warned that war would result if these were the first steps towards
independence.
On the other hand, improvements were seen in the relationship with
North Korea. After talks by six countries in China at the end of
August, North Korea invited U.S. nuclear experts to visit its main
nuclear complex this year. The move by North Korea could signal its
willingness to allow more extensive inspections in the future.
INVESTMENT HIGHLIGHTS
For the six-month period ending December 31, 2003, the fund provided
a total return of 58.55 percent. The fund successfully outperformed
its benchmark, the Hang Seng Composite Index, which gained 38.70
percent for the same period, and was listed within the Wall Street
Journal's top 50 best performers for the year ended December 31,
2003. Leading the region was the Thailand market, which advanced
67.30 percent. In China, the two Chinese B shares markets went in
different directions as the Shenzhen market gained 27.58 percent
while the Shanghai market lost 4.94 percent.
During the period, we focused the fund's investments on broad themes
we saw unfolding in China, which included China's growing demand for
commodities and energy, growing discretionary demand from rising
income levels and continued strong exports. We added securities that
benefited from these trends. Recent economic reports reaffirm our
view on the strong domestic economy in China. We also sought to take
advantage of China's strong export growth by adding exporters and
port operation companies in the portfolio.
22
- ---------------------------------------------------------------------------
CHINA REGION OPPORTUNITY FUND
- ---------------------------------------------------------------------------
In terms of country allocation, we increased our exposure to Chinese
companies to capture the fast-growing economy in China. Countries
that saw less exposure included Korea, due to weak economic numbers,
and Singapore for the same reason. We use quantitative models to
guide our cash-flow investment decisions; thus, there will be times
when we are fully invested or have a short-term larger cash
position.
As for sector allocation, good demand from semiconductor companies
and a seasonally strong period caused us to increase our technology
exposure. Positive policy changes prompted us to increase our
exposure to the housing stocks. With the Olympics coming up in 2008
in Beijing, China, and the continued need for infrastructure
improvements, we maintained our position in industrials.
CURRENT OUTLOOK
We continue to believe that China will drive the region's economic
growth. However, we remain on the outlook for signs that China is
starting to overheat or that the government is taking steps to slow
down the country's growth. For now, we remain positive on the basic
materials and energy sectors. Other risks include the Taiwan
presidential election, which will happen this March, and the
possible comeback of SARS.
23
- --------------------------------------------------------------------
CHINA REGION OPPORTUNITY FUND
- --------------------------------------------------------------------
- --------------------------------------------------------------------
PORTFOLIO PROFILE December 31, 2003
- --------------------------------------------------------------------
Country Distribution (based on domicile) % of Investments
---------------------------------------------------------------
People's Republic of China 37.52%
---------------------------------------------------------------
Hong Kong 19.65%
---------------------------------------------------------------
United States 18.92%
---------------------------------------------------------------
Canada 8.77%
---------------------------------------------------------------
United Kingdom 5.41%
---------------------------------------------------------------
Taiwan 3.38%
---------------------------------------------------------------
Other Foreign 6.35%
- --------------------------------------------------------------------
24
- -----------------------------------------------------------------------
CHINA REGION OPPORTUNITY FUND
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2003
- -----------------------------------------------------------------------
HSBC HOLDINGS PLC 4.56%
BANKING & FINANCIAL SERVICES
---------------------------------------------------------------
ALUMINUM CORPORATION OF CHINA LTD. 2.36%
NATURAL RESOURCES
---------------------------------------------------------------
CAPITAL ALLIANCE GROUP, INC. 2.14%
EDUCATION
---------------------------------------------------------------
CHINA PETROLEUM & CHEMICAL CORPORATION 2.10%
OIL & GAS EXTRACTION
---------------------------------------------------------------
PETROCHINA CO., LTD. 2.09%
OIL & GAS EXTRACTION
---------------------------------------------------------------
CITIC INTERNATIONAL FINANCIAL HOLDINGS LTD. 2.05%
BANKING & FINANCIAL SERVICES
---------------------------------------------------------------
LI & FUNG LTD. 2.03%
APPAREL
---------------------------------------------------------------
SINOPEC ZHENHAI REFINING AND CHEMICAL CO., LTD. 1.96%
CHEMICALS & ALLIED PRODUCTS
---------------------------------------------------------------
ANHUI CONCH CEMENT COMPANY LTD. 1.95%
BUILDING MATERIALS
---------------------------------------------------------------
CHINA MERCHANTS HOLDINGS INTERNATIONAL COMPANY LTD. 1.73%
CONGLOMERATES
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS December 31, 2003
- -----------------------------------------------------------------------
NATURAL RESOURCES 14.03%
BANKING & FINANCIAL SERVICES 11.32%
ELECTRONIC EQUIPMENT 8.07%
OIL & GAS EXTRACTION 6.68%
CHEMICALS & ALLIED PRODUCTS 5.29%
25
- -----------------------------------------------------------------------
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------
MANAGEMENT TEAM'S PERSPECTIVE
INTRODUCTION
The Global Resources Fund is a diversified natural resources fund
with the principal objective of achieving long-term growth of
capital, while providing protection against inflation and monetary
instability. The fund invests in companies involved in the
exploration, production and processing of petroleum, natural gas,
industrial commodities, metals, minerals, paper and forest products
and can invest in any part of the world.
PERFORMANCE
- -----------------------------------------------------------------------
GLOBAL RESOURCES FUND - GROWTH OF $10,000 OVER FIVE YEARS
- -----------------------------------------------------------------------
[Graphics: Line Chart created with data points from the table below}
- -----------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date Global Resources Fund S&P 500 Total Return Index S&P Energy and Materials Index
12/31/98 $10,000.00 $10,000.00 10,000.00
01/29/99 9,505.81 10,418.16 9,419.80
02/26/99 9,418.60 10,094.38 9,417.49
03/31/99 10,348.84 10,498.24 10,454.89
04/30/99 12,063.95 10,904.79 12,273.67
05/28/99 11,482.56 10,647.27 11,794.15
06/30/99 11,656.98 11,238.18 12,049.25
07/30/99 11,686.05 10,887.27 12,098.63
08/31/99 11,540.70 10,833.41 12,104.22
09/30/99 11,133.72 10,536.42 11,657.00
10/29/99 10,901.16 11,203.18 11,616.91
11/30/99 10,930.23 11,430.92 11,721.76
12/31/99 11,453.49 12,104.15 12,125.50
01/31/00 11,075.58 11,496.01 11,557.78
02/29/00 10,465.12 11,278.40 10,755.60
03/31/00 11,598.84 12,381.69 11,866.22
04/28/00 11,424.42 12,009.23 11,641.25
05/31/00 12,005.81 11,762.84 12,351.19
06/30/00 11,279.07 12,052.83 11,563.70
07/31/00 11,075.58 11,864.39 11,400.97
08/31/00 12,296.51 12,601.34 12,078.15
09/29/00 12,267.44 11,936.08 11,992.83
10/31/00 11,802.33 11,885.62 12,170.21
11/30/00 11,220.93 10,948.56 11,845.50
12/31/00 12,674.42 11,002.15 12,849.52
01/31/01 12,267.44 11,392.49 12,480.46
02/28/01 12,063.95 10,353.71 12,366.42
03/30/01 11,889.53 9,697.79 12,069.46
04/30/01 12,965.12 10,451.41 13,311.72
05/31/01 12,819.77 10,521.44 13,536.38
06/30/01 11,656.98 10,265.36 12,726.37
07/31/01 11,191.86 10,164.30 12,585.45
08/31/01 10,784.88 9,528.00 12,260.68
09/30/01 10,087.21 8,758.59 11,272.72
10/31/01 10,755.81 8,925.61 11,607.69
11/30/01 10,843.02 9,610.26 11,715.47
12/31/01 10,959.30 9,694.45 12,070.11
01/31/02 10,988.37 9,552.98 11,978.95
02/28/02 11,598.84 9,368.74 12,538.23
03/31/02 12,674.42 9,721.10 13,253.47
04/30/02 13,459.30 9,131.73 12,590.88
05/31/02 16,191.86 9,064.45 12,844.61
06/30/02 14,331.40 8,418.71 12,744.03
07/31/02 11,133.72 7,762.51 11,181.52
08/31/02 11,686.05 7,813.47 11,175.12
09/30/02 11,453.49 6,964.31 10,071.14
10/31/02 10,697.67 7,577.28 10,431.42
11/30/02 11,104.65 8,023.28 11,079.76
12/31/02 12,908.42 7,551.92 10,942.22
01/31/03 13,650.28 7,354.09 10,582.34
02/28/03 13,917.35 7,243.75 10,656.16
03/31/03 13,442.56 7,314.08 10,751.84
04/30/03 13,412.89 7,916.55 11,021.46
05/31/03 14,985.64 8,333.65 11,791.18
06/30/03 15,252.71 8,439.96 11,737.21
07/31/03 15,994.57 8,588.77 11,815.02
08/31/03 18,012.44 8,756.27 12,440.52
09/30/03 18,962.02 8,663.28 12,057.71
10/31/03 22,107.52 9,153.36 12,463.97
11/30/03 23,858.32 9,233.89 12,584.44
12/31/03 $25,760.16 $9,718.16 14,189.71
26
- -------------------------------------------------------------------------
GLOBAL RESOURCES FUND
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
GLOBAL RESOURCES FUND - GROWTH OF $10,000 OVER TEN YEARS
- -------------------------------------------------------------------------
[Graphics: Line Chart created from data points listed in table below:}
- ------------------------------------------------------------------------------------------------------------------------------------
Date Global Resources Fund S&P 500 Total Return Index S&P Energy and Materials Index
12/31/93 10,000.00 10,000.00 $10,000.00
01/31/94 10,476.92 10,339.97 10,572.32
02/28/94 10,107.69 10,059.33 10,276.66
03/31/94 9,523.08 9,620.77 9,841.87
04/29/94 9,307.69 9,744.14 10,160.92
05/31/94 9,307.69 9,904.05 10,370.81
06/30/94 8,830.77 9,661.28 10,101.26
07/29/94 9,092.31 9,978.53 10,589.95
08/31/94 9,369.23 10,387.64 10,750.26
09/30/94 9,738.46 10,133.63 10,558.15
10/31/94 9,584.62 10,361.30 11,050.49
11/30/94 9,030.77 9,983.88 10,432.04
12/30/94 9,030.77 10,132.05 10,463.90
01/31/95 8,559.74 10,394.81 10,484.97
02/28/95 8,657.19 10,799.91 10,977.61
03/31/95 8,900.83 11,118.58 11,551.83
04/28/95 9,144.47 11,445.98 11,816.92
05/31/95 9,258.16 11,903.46 12,280.63
06/30/95 9,355.62 12,179.95 12,111.66
07/31/95 9,615.50 12,583.87 12,489.23
08/31/95 9,761.68 12,615.50 12,211.45
09/29/95 9,729.19 13,147.89 12,422.50
10/31/95 9,290.65 13,100.90 12,201.83
11/30/95 9,388.10 13,676.02 12,832.45
12/29/95 9,842.89 13,939.44 13,374.55
01/31/96 10,205.00 14,413.89 13,627.50
02/29/96 10,320.22 14,547.52 13,700.23
03/29/96 10,896.31 14,687.56 14,423.17
04/30/96 11,538.24 14,904.10 14,702.14
05/31/96 11,719.29 15,288.47 14,796.73
06/28/96 11,488.86 15,346.80 14,673.66
07/31/96 10,995.07 14,668.76 14,170.49
08/30/96 11,390.10 14,978.19 14,500.73
09/30/96 11,850.97 15,821.24 15,086.78
10/31/96 12,410.60 16,257.60 15,765.60
11/29/96 13,068.99 17,486.46 16,529.64
12/31/96 13,200.66 17,139.98 16,440.37
01/31/97 13,685.43 18,210.79 17,137.53
02/28/97 12,939.63 18,353.53 16,787.31
03/31/97 12,846.41 17,599.73 17,151.75
04/30/97 12,510.80 18,650.08 17,401.65
05/30/97 13,704.08 19,785.55 18,620.53
06/30/97 13,666.79 20,671.98 19,292.59
07/31/97 14,822.78 22,316.80 20,705.16
08/29/97 15,643.16 21,066.57 19,993.17
09/30/97 17,022.89 22,220.32 21,010.68
10/31/97 16,127.93 21,478.22 20,069.77
11/28/97 13,536.27 22,472.50 19,896.59
12/31/97 12,837.09 22,858.44 19,769.73
01/30/98 11,312.95 23,111.27 18,979.10
02/27/98 11,570.55 24,778.16 20,247.34
03/31/98 11,549.08 26,047.02 21,179.47
04/30/98 11,248.55 26,309.08 21,939.45
05/29/98 10,239.62 25,856.88 21,280.34
06/30/98 9,595.61 26,907.16 20,838.01
07/31/98 8,844.28 26,620.64 19,484.64
08/31/98 7,427.48 22,771.90 17,192.64
09/30/98 8,221.75 24,230.68 19,202.52
10/30/98 8,522.28 26,201.65 19,561.43
11/30/98 8,286.15 27,789.68 19,873.78
12/31/98 7,892.64 29,391.06 19,512.77
01/29/99 7,502.59 30,620.08 18,380.64
02/26/99 7,433.76 29,668.45 18,376.14
03/31/99 8,167.96 30,855.44 20,400.38
04/30/99 9,521.64 32,050.33 23,949.34
05/28/99 9,062.76 31,293.45 23,013.66
06/30/99 9,200.43 33,030.21 23,511.42
07/30/99 9,223.37 31,998.85 23,607.78
08/31/99 9,108.65 31,840.54 23,618.68
09/30/99 8,787.44 30,967.67 22,746.04
10/29/99 8,603.89 32,927.32 22,667.81
11/30/99 8,626.83 33,596.68 22,872.40
12/31/99 9,039.82 35,575.39 23,660.21
01/31/00 8,741.55 33,788.00 22,552.43
02/29/00 8,259.73 33,148.40 20,987.15
03/31/00 9,154.54 36,391.11 23,154.28
04/28/00 9,016.88 35,296.41 22,715.30
05/31/00 9,475.75 34,572.23 24,100.58
06/30/00 8,902.16 35,424.55 22,563.99
07/31/00 8,741.55 34,870.71 22,246.44
08/31/00 9,705.19 37,036.69 23,567.81
09/29/00 9,682.24 35,081.40 23,401.34
10/31/00 9,315.15 34,933.09 23,747.46
11/30/00 8,856.27 32,178.98 23,113.86
12/31/00 10,003.46 32,336.48 25,072.97
01/31/01 9,682.24 33,483.74 24,352.83
02/28/01 9,521.64 30,430.64 24,130.32
03/30/01 9,383.98 28,502.84 23,550.87
04/30/01 10,232.89 30,717.81 25,974.85
05/31/01 10,118.18 30,923.62 26,413.23
06/30/01 9,200.43 30,170.98 24,832.68
07/31/01 8,833.33 29,873.97 24,557.71
08/31/01 8,512.12 28,003.81 23,923.98
09/30/01 7,961.47 25,742.43 21,996.21
10/31/01 8,489.17 26,233.31 22,649.83
11/30/01 8,558.00 28,245.57 22,860.13
12/31/01 8,649.78 28,493.02 23,552.13
01/31/02 8,672.72 28,077.22 23,374.26
02/28/02 9,154.54 27,535.74 24,465.56
03/31/02 10,003.46 28,571.34 25,861.19
04/30/02 10,622.94 26,839.12 24,568.30
05/31/02 12,779.65 26,641.39 25,063.40
06/30/02 11,311.25 24,743.47 24,867.13
07/31/02 8,787.44 22,814.84 21,818.25
08/31/02 9,223.37 22,964.63 21,805.75
09/30/02 9,039.82 20,468.85 19,651.59
10/31/02 8,443.28 22,270.44 20,354.58
11/30/02 8,764.50 23,581.26 21,619.67
12/31/02 10,188.15 22,195.91 21,351.30
01/31/03 10,773.67 21,614.46 20,649.08
02/28/03 10,984.46 21,290.16 20,793.12
03/31/03 10,609.72 21,496.86 20,979.81
04/30/03 10,586.30 23,267.57 21,505.92
05/31/03 11,827.62 24,493.47 23,007.85
06/30/03 12,038.41 24,805.93 22,902.56
07/31/03 12,623.93 25,243.29 23,054.38
08/31/03 14,216.56 25,735.60 24,274.90
09/30/03 14,966.03 25,462.30 23,527.93
10/31/03 17,448.66 26,902.70 24,320.66
11/30/03 18,830.50 27,139.40 24,555.72
12/31/03 20,331.55 28,562.71 27,688.07
- ------------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2003
- -------------------------------------------------------------------------
Six Month One Year Five Year Ten Year
Global Resources Fund 68.89% 99.56% 20.82% 7.35%
-----------------------------------------------------------------------
S&P 500 Total Return Index 15.14% 28.68% (0.57)% 11.07%
-----------------------------------------------------------------------
S&P Energy and Materials
Index 20.90% 29.68% 7.25% 10.72%
Performance data quoted represent past performance. Investment return
and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
The graph and table do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
The S&P 500 Total Return Index is a widely recognized
capitalization-weighted index of 500 common stock prices in U.S.
companies.
The S&P Energy and Materials Index is a combination of the S&P Energy
Index and the S&P Materials Index calculated on a 70% and 30%
weighting, respectively, with monthly rebalancing of weights.
- -------------------------------------------------------------------------
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
The global economy experienced continued growth in the final six
months of 2003. Following years of disappointing second-half
economic growth, world economies gave investors reason to believe
that sustainable growth may continue in the near future. Highlights
from the global markets include above 8 percent GDP growth in China
supported by double-digit percentage gains in industrial production,
rising momentum in India's economy, and growth in the developed
economies of Europe, Japan and
27
- -------------------------------------------------------------------------
GLOBAL RESOURCES FUND
- -------------------------------------------------------------------------
the United States. Consumers also appear to be gaining faith in
their local economies according to confidence reports.
China remains one of the most important factors in the recent
commodity market rallies. In some instances, the growth in demand
for commodities has come completely from Chinese buyers. The country
is experiencing world-leading industrial production growth as the
country prepares for the Olympic games in 2008 and their complete
entrance into the World Trade Organization. Worker migration is also
playing a significant role in China's construction boom. Rural
Chinese citizens are moving to the urban Chinese centers to take
advantage of the large relative wage differences. This is causing
housing demand to increase dramatically and leaving builders short
of supply.
U.S. Global Investors entered 2003 with three specific investment
themes for the calendar year: the weakening U.S. dollar relative to
global currencies, strong growth in commodity demand from Asia,
especially China, and the positive effects of the presidential
election cycle on the U.S. economy. The benefits for the Global
Resources Fund were slow to take hold early in the year, but the
outcomes of our work were in full bloom during the second half of
2003. On a trade-weighted basis, the U.S. dollar declined more than
8 percent in value over the final two quarters of the year, and
China experienced dramatic economic growth that was unrivaled in
the world markets. Domestically, George W. Bush's reelection
campaign was silently under way with massive spending plans and
tax cuts in place. The result is an improving U.S. economy.
INVESTMENT HIGHLIGHTS
For the six-month period ending December 31, 2003, the fund had a
return of 68.89 percent. In comparison, the S&P 500 Energy Index and
the S&P 500 Basic Materials Index rose by 16.51 percent and 30.88
percent, respectively. The broader S&P 500 Total Return Index gained
15.14 percent over the same period. The fund's strong performance
relative to its benchmark and peer group is best attributed to the
investment team's process of analyzing commodity price movements and
relative value in equities and looking for growth outside the U.S.
market.
Energy prices experienced their normal seasonal pattern during the
second half of the year, with price declines during the shoulder
season of demand. With regards to energy, the most interesting
aspect of the past six months was the high absolute level of prices
that were persistent during the entire period. Crude oil prices rose
slightly less than 10 percent to finish the semi-annual period at
$32.50 per barrel West Texas Intermediate (WTI). Prices dipped to
$27 per barrel in mid-September but quickly
28
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GLOBAL RESOURCES FUND
- -------------------------------------------------------------------------
rallied back above $30. Natural gas prices experienced a similar
pattern, dipping below $5/mcf during the inventory-build season,
only to finish flat for the period.
Investors were undoubtedly surprised by the resilience in pricing,
but were still unwilling to pay for what they perceived to be
unsustainable profitability at exploration and production companies.
We were aware of this psychological effect in the market and took
advantage of the opportunity by buying energy stocks in
mid-November. The portfolio team felt energy stocks would start to
receive attention when analysts were forced to revise higher their
price forecasts for 2004. Our expectations were fulfilled in
December, as the energy sector was the best performing group.
Metals and mining stocks were the highlight of the third and fourth
quarters of 2003. The group led the market, gaining 84 percent. Gold
prices rallied from below $350 per ounce to break the
psychologically-important $400 level. The falling dollar was gold
bullion's best friend over the last two quarters, trading with a
strong inverse correlation. Base metals also enjoyed strong gains,
with platinum breaking above $800 per ounce, copper above $1 per
pound and nickel prices notching strong gains to close above $7 per
pound. The stocks that were exposed to these commodities reacted in
kind, giving us solid gains.
The utilities sector continues to be underweighted in the fund, due
to opportunities we see elsewhere. We are interested and invested in
several companies that are involved in the trend to increase imports
of liquefied natural gas. We believe liquefied natural gas (LNG) is
the only option, aside from sustainable high prices, that will solve
the natural gas supply shortage we are experiencing in the United
States.
CURRENT OUTLOOK
U.S. Global Investors believes we are in a secular bull market for
essentially all commodities. The increase in demand will continue to
come from Asia and other developing countries, while demand from
developed economies such as the U.S. and Europe will add to the
tightening market. The risks to this viewpoint are a slowdown in
Asian economic growth brought on by government intervention, rising
interest rates or terrorist events that could slow the perception of
a rebounding global economy.
29
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GLOBAL RESOURCES FUND
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
TOP 10 EQUITY* HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2003
- -------------------------------------------------------------------------
NORTHERN ORION RESOURCES, INC. 2.51%
GOLD & COPPER MINING
---------------------------------------------------------------
WHEATON RIVER MINERALS LTD. 2.23%
GOLD & COPPER MINING
---------------------------------------------------------------
PIONEER NATURAL RESOURCES CO. 1.59%
OIL & GAS EXPLORATION & PRODUCTION - SENIOR
---------------------------------------------------------------
ENERGY SAVINGS INCOME FUND 1.55%
GAS DISTRIBUTION
---------------------------------------------------------------
BONAVISTA ENERGY TRUST 1.47%
OIL & GAS ROYALTY TRUSTS
---------------------------------------------------------------
EOG RESOURCES, INC. 1.46%
OIL & GAS EXPLORATION & PRODUCTION - SENIOR
---------------------------------------------------------------
ENERPLUS RESOURCES FUND 1.38%
OIL & GAS ROYALTY TRUSTS
---------------------------------------------------------------
DEVON ENERGY CORP. 1.29%
OIL & GAS EXPLORATION & PRODUCTION - SENIOR
---------------------------------------------------------------
PETROCHINA CO. LTD. 1.29%
INTEGRATED OIL & GAS
---------------------------------------------------------------
CNOOC LTD. 1.26%
OIL & GAS EXPLORATION & PRODUCTION - SENIOR
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS December 31, 2003
- -------------------------------------------------------------------------
OIL & GAS EXPLORATION & PRODUCTION - SENIOR 10.69%
OIL & GAS ROYALTY TRUSTS 10.51%
GOLD MINING 7.84%
OIL & GAS EQUIPMENT & SERVICES 6.56%
GOLD & COPPER MINING 6.38%
*Includes convertible debentures.
30
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GLOBAL RESOURCES FUND
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
PORTFOLIO PROFILE December 31, 2003
- -------------------------------------------------------------------------
Country Distribution (based on domicile) % of Investments
---------------------------------------------------------------
Canada 44.63%
---------------------------------------------------------------
United States 42.89%
---------------------------------------------------------------
People's Republic of China 3.79%
---------------------------------------------------------------
United Kingdom 2.55%
---------------------------------------------------------------
Hong Kong 1.26%
---------------------------------------------------------------
Other Foreign 4.88%
- -------------------------------------------------------------------------
31
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GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
MANAGEMENT TEAM'S PERSPECTIVE
INTRODUCTION
The World Precious Minerals and Gold Shares Funds pursue an
objective of long-term capital growth through investments in gold
and precious metal companies. The Gold Shares Fund also pursues
current income as a secondary objective and focuses on established,
gold-producing mines. The World Precious Minerals Fund focuses on
equity securities of companies principally engaged in the
exploration, mining, and processing of precious minerals such as
gold, silver, platinum, and diamonds. Although the fund has greater
latitude to invest its assets in different precious minerals, it
currently remains focused on the gold sector.
PERFORMANCE
- -------------------------------------------------------------------------
WORLD PRECIOUS MINERALS FUND
- -------------------------------------------------------------------------
[Graphics: Line Chart created from data points from the table below:]
- --------------------------------------------------------------------------------
WORLD PRECIOUS TORONTO STOCK EXCHANGE
Date MINERALS FUND GOLD & PRECIOUS MINERALS
12/31/93 $ 10,000.00 $10,000.00
01/31/94 10,345.61 10,077.56
02/28/94 9,807.37 9,455.26
03/31/94 9,824.36 9,650.85
04/29/94 9,036.83 8,529.89
05/31/94 9,467.42 9,176.08
06/30/94 8,855.52 8,541.93
07/29/94 8,866.86 8,481.31
08/31/94 9,274.79 8,957.71
09/30/94 9,830.03 10,102.64
10/31/94 9,291.78 9,145.30
11/30/94 8,118.98 7,896.94
12/30/94 8,305.95 8,471.14
01/31/95 7,431.64 7,439.96
02/28/95 7,590.60 7,927.88
03/31/95 8,464.91 9,014.85
04/28/95 8,697.69 9,052.99
05/31/95 8,680.65 9,390.83
06/30/95 8,975.88 9,476.38
07/31/95 9,367.61 9,474.92
08/31/95 9,623.09 9,620.60
09/29/95 9,617.41 9,764.81
10/31/95 8,629.56 8,563.28
11/30/95 9,367.61 9,464.96
12/29/95 9,628.77 9,454.38
01/31/96 11,184.36 10,859.42
02/29/96 11,485.26 11,255.78
03/29/96 12,098.41 11,329.97
04/30/96 12,473.12 11,227.26
05/31/96 13,744.84 11,933.99
06/28/96 11,990.54 10,040.14
07/31/96 11,683.97 10,075.47
08/30/96 12,751.31 10,619.73
09/30/96 12,376.60 10,061.34
10/31/96 12,052.99 10,223.95
11/29/96 11,859.96 10,498.88
12/31/96 11,507.97 10,217.34
01/31/97 10,865.30 9,779.64
02/28/97 11,970.45 10,453.33
03/31/97 10,540.96 8,457.37
04/30/97 10,024.43 7,801.13
05/30/97 10,564.99 8,418.86
06/30/97 9,579.96 7,453.13
07/31/97 9,123.49 7,453.33
08/29/97 9,339.71 7,318.29
09/30/97 9,736.13 8,121.85
10/31/97 8,102.43 6,641.84
11/28/97 6,426.68 4,934.87
12/31/97 6,780.45 5,524.87
01/30/98 7,364.24 5,786.24
02/27/98 6,975.05 5,637.94
03/31/98 7,449.38 6,062.54
04/30/98 7,759.51 6,477.79
05/29/98 6,658.83 5,526.19
06/30/98 5,995.99 5,126.72
07/31/98 5,576.39 4,419.89
08/31/98 4,360.17 3,340.21
09/30/98 6,020.31 5,309.17
10/30/98 5,941.26 5,400.27
11/30/98 5,545.98 5,021.68
12/31/98 5,711.39 4,771.88
01/29/99 5,467.83 4,646.92
02/26/99 5,352.15 4,372.42
03/31/99 5,242.55 4,260.84
04/30/99 5,869.70 5,022.76
05/28/99 4,798.06 4,157.95
06/30/99 4,743.26 4,427.62
07/30/99 4,475.34 4,149.43
08/31/99 4,664.10 4,289.64
09/30/99 5,875.79 5,402.17
10/29/99 5,272.99 4,639.85
11/30/99 5,041.61 4,361.57
12/31/99 4,986.81 4,174.18
01/31/00 4,426.63 3,701.97
02/29/00 4,499.70 3,603.50
03/31/00 4,158.72 3,378.66
04/28/00 3,951.70 3,519.05
05/31/00 3,829.92 3,651.68
06/30/00 3,915.16 3,729.97
07/31/00 3,501.12 3,297.26
08/31/00 3,641.16 3,436.18
09/29/00 3,269.74 3,336.77
10/31/00 2,922.67 2,982.56
11/30/00 2,892.23 3,297.86
12/31/00 3,087.68 3,583.17
01/31/01 3,057.11 3,372.00
02/28/01 3,051.00 3,523.18
03/30/01 2,849.23 3,242.30
04/30/01 3,118.25 3,739.25
05/31/01 3,240.54 3,819.64
06/30/01 3,228.31 3,706.82
07/31/01 3,044.88 3,645.38
08/31/01 3,087.68 3,860.73
09/30/01 3,264.99 4,249.05
10/31/01 3,222.20 3,931.02
11/30/01 3,203.85 3,797.00
12/31/01 3,320.02 3,948.40
01/31/02 3,900.87 4,409.47
02/28/02 4,273.84 4,611.01
03/31/02 4,970.86 4,808.76
04/30/02 5,490.57 5,136.46
05/31/02 7,728.38 5,982.09
06/30/02 6,377.13 5,212.98
07/31/02 4,585.67 4,204.94
08/31/02 5,221.55 4,768.34
09/30/02 5,258.23 4,737.05
10/31/02 4,561.21 4,310.12
11/30/02 4,610.12 4,232.91
12/31/02 6,089.53 5,034.43
01/31/03 6,321.82 5,119.83
02/28/03 6,089.53 4,781.07
03/31/03 5,737.97 4,502.52
04/30/03 5,587.30 4,445.05
05/31/03 5,995.37 4,943.89
06/30/03 6,120.92 5,078.67
07/31/03 6,516.43 5,165.23
08/31/03 7,640.17 5,964.64
09/30/03 8,230.29 5,840.46
10/31/03 10,069.70 6,387.00
11/30/03 11,733.34 7,389.70
12/31/03 11,734.43 7,186.64
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2003
- -------------------------------------------------------------------------
Six Month One Year Five Year Ten Year
World Precious Minerals Fund 91.71% 92.70% 15.48% 1.61%
-----------------------------------------------------------------------
Toronto Stock Exchange Gold
& Precious Minerals Index* 41.51% 42.75% 8.53% (3.25)%
<FN>
*These are not total returns. These returns reflect simple appreciation
only and do not reflect dividend reinvestment.
Performance data quoted represent past performance. Investment return
and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
The graph and table do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
The Toronto Stock Exchange Gold & Precious Minerals Index is a
capitalization-weighted index designed to measure the performance of
the gold and precious minerals sector of the TSX 300 Index.
- -------------------------------------------------------------------------
</FN>
32
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GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
GOLD SHARES FUND
- -------------------------------------------------------------------------
[Graphics: Line Chart was created using data points from the table below]:
- --------------------------------------------------------------------------------
Date Gold Shares Fund Philadelphia Stock Exchange
Gold & Silver Index
12/31/93 $10,000.00 $10,000.00
01/31/94 8,993.06 9,994.69
02/28/94 8,437.50 9,733.15
03/31/94 8,333.33 10,135.70
04/29/94 8,576.39 8,674.85
05/31/94 8,298.61 9,121.37
06/30/94 8,715.28 8,737.02
07/29/94 9,031.56 8,471.69
08/31/94 10,015.54 8,984.91
09/30/94 11,210.38 10,024.26
10/31/94 10,612.96 8,900.77
11/30/94 9,277.55 7,785.61
12/30/94 9,734.40 8,288.23
01/31/95 7,452.35 7,382.31
02/28/95 7,880.23 7,871.28
03/31/95 8,236.80 9,246.46
04/28/95 7,844.57 8,864.38
05/31/95 7,630.63 9,097.11
06/30/95 7,737.60 9,111.52
07/31/95 8,352.27 8,998.56
08/31/95 8,316.11 9,298.76
09/29/95 8,243.80 9,415.51
10/31/95 6,978.30 8,125.24
11/30/95 7,050.62 9,181.26
12/29/95 7,122.93 9,128.95
01/31/96 8,701.73 10,692.90
02/29/96 8,444.71 10,921.08
03/29/96 7,967.40 10,903.65
04/30/96 8,004.12 10,872.56
05/31/96 8,224.42 11,287.24
06/28/96 6,829.20 9,382.15
07/31/96 6,754.97 9,426.88
08/30/96 6,717.86 9,442.04
09/30/96 6,124.01 8,731.71
10/31/96 6,012.67 8,763.55
11/29/96 5,604.40 9,111.52
12/31/96 5,307.48 8,850.73
01/31/97 4,776.73 8,354.18
02/28/97 5,459.12 9,283.60
03/31/97 4,700.91 7,893.26
04/30/97 4,321.80 7,115.46
05/30/97 4,397.63 7,907.66
06/30/97 3,654.58 7,247.37
07/31/97 3,732.34 7,423.24
08/29/97 3,771.21 7,495.26
09/30/97 3,693.46 8,301.11
10/31/97 2,877.01 6,664.39
11/28/97 2,216.07 5,368.81
12/31/97 2,262.73 5,624.29
01/30/98 2,262.73 5,683.42
02/27/98 2,064.24 5,719.81
03/31/98 2,103.94 6,191.34
04/30/98 2,223.03 6,665.91
05/29/98 1,786.36 5,663.71
06/30/98 1,504.52 5,437.04
07/31/98 1,516.42 4,769.92
08/31/98 1,167.09 3,706.31
09/30/98 1,627.58 5,684.94
10/30/98 1,591.85 5,715.26
11/30/98 1,492.61 5,379.43
12/31/98 1,516.42 4,925.33
01/29/99 1,448.94 4,795.69
02/26/99 1,417.18 4,591.01
03/31/99 1,409.24 4,530.36
04/30/99 1,568.03 5,565.92
05/28/99 1,321.91 4,614.51
06/30/99 1,357.64 5,073.91
07/30/99 1,270.30 4,766.13
08/31/99 1,337.79 5,105.00
09/30/99 1,703.00 6,084.45
10/29/99 1,524.36 5,272.53
11/30/99 1,460.85 5,082.25
12/31/99 1,476.73 5,152.76
01/31/00 1,298.09 4,547.04
02/29/00 1,306.03 4,530.36
03/31/00 1,206.79 4,283.22
04/28/00 1,111.52 4,150.56
05/31/00 1,111.52 4,266.55
06/30/00 1,159.15 4,382.53
07/31/00 1,048.00 3,854.90
08/31/00 1,111.52 3,967.86
09/29/00 1,040.06 3,784.40
10/31/00 936.85 3,325.75
11/30/00 952.73 3,569.10
12/31/00 1,036.09 3,897.35
01/31/01 1,024.18 3,704.04
02/28/01 1,048.00 3,980.74
03/30/01 952.73 3,606.25
04/30/01 1,079.76 4,179.36
05/31/01 1,127.39 4,330.98
06/30/01 1,123.42 4,036.84
07/31/01 1,040.06 4,022.44
08/31/01 1,067.85 4,287.77
09/30/01 1,111.52 4,381.02
10/31/01 1,095.64 4,133.88
11/30/01 1,087.70 3,985.29
12/31/01 1,151.21 4,126.30
01/31/02 1,341.76 4,649.38
02/28/02 1,536.27 4,939.73
03/31/02 1,754.61 5,374.12
04/30/02 1,929.27 5,606.85
05/31/02 2,556.49 6,386.17
06/30/02 2,096.00 5,417.33
07/31/02 1,548.18 4,589.49
08/31/02 1,790.33 5,265.71
09/30/02 1,841.94 5,286.94
10/31/02 1,587.88 4,809.34
11/30/02 1,603.76 4,804.79
12/31/02 2,088.06 5,819.12
01/31/03 2,139.67 5,837.31
02/28/03 2,004.70 5,457.51
03/31/03 1,877.67 5,073.16
04/30/03 1,794.30 4,950.34
05/31/03 1,996.76 5,568.95
06/30/03 2,056.30 5,962.40
07/31/03 2,163.49 6,149.65
08/31/03 2,516.79 6,898.64
09/30/03 2,627.94 6,907.74
10/31/03 3,036.82 7,435.37
11/30/03 3,608.46 8,313.24
12/31/03 3,488.66 8,251.08
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2003
- -------------------------------------------------------------------------
Six Month One Year Five Year Ten Year
Gold Shares Fund 69.66% 67.08% 18.12% (9.99)%
----------------------------------------------------------------------
Philadelphia Stock Exchange
Gold & Silver Index* 38.39% 41.79% 10.87% (1.90)%
<FN>
*These are not total returns. These returns reflect simple
appreciation only and do not reflect dividend reinvestment.
Performance data quoted represent past performance. Investment return
and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their
original cost.
The graph and table do not reflect the deduction of taxes that a
shareholder would pay on fund distributions or the redemption of fund
shares.
The Philadelphia Stock Exchange Gold & Silver Index is a
capitalization-weighted index which includes the leading companies
involved in the mining of gold and silver.
- -------------------------------------------------------------------------
</FN>
33
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GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
[Graphics: Gold Critical Drivers chart]
- ---------------------------------------------------------------------------
Cause Effect Rammifications
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
War on Deficit Spending Weaker U.S. Higher Gold
Terrorism $450B Currency Prices
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Deflation 40-7ear Low in Rising Money Higher Gold
Fears Interest Rates Supply Prices
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Low Gold Cuts in Falling Higher Gold
Prices Exploration Production Prices
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
Low Interest Hedging Less Supply Higher Gold
Rates Curtailed Prices
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
China Trade Foreign Reserve Higher Gold
Surplus Gold Exposure Prices
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
China Shanghai Gold Increased Higher Gold
Exchange Demand & Prices
Liquidity
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
China Rural Domestic Income Increase Higher Gold
Policy for 800 Million Prices
Chinese
- ---------------------------------------------------------------------------
INVESTMENT HIGHLIGHTS
For the six months ending December 31, 2003, the World Precious
Minerals Fund returned 91.71 percent and the Gold Shares Fund
returned a gain of 69.66 percent. The Toronto Stock Exchange Gold &
Precious Minerals Index, World Precious Minerals Fund's benchmark,
gained 41.51 percent, while the Philadelphia Stock Exchange Gold &
Silver Index, Gold Shares Fund's benchmark, returned 38.39 percent.
Spot gold rose to $415.45, up $69.05 or 19.93 percent for the same
period. In contrast, the S&P 500 Total Return Index posted a
positive return of 15.14 percent while the U.S. Trade-Weighted
Dollar Index(1) has fallen 8.24 percent over the last six months.
Over the same period, the yield on the 90-day Treasury Bill edged up
7 basis points to finish at 0.92 percent.
We have made several critical investment decisions, which generated
superior relative performance:
1. We focused on mid-cap unhedged gold producers.
2. We also concentrated our investments in companies which produced
two metals; i.e., copper-gold porphyry producers like Wheaton
River Minerals Ltd.;(2) which has demonstrated over 500 percent
growth in
34
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GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
cash flow on a year-over-year basis for the past year; Northgate
Exploration Ltd.;(3) Northern Orion Resources, Inc.;(4) and Bema
Gold Corp.(5)
3. We invested in companies reflecting the three critical growth
drivers:
(a) increasing revenues
(b) increasing production
(c) increasing cash flow
4. We looked for undervalued junior gold companies with inexpensive
resource ounces in the ground.
5. We wanted to own companies whereby a rising gold price would
greatly increase their reserve base and net asset value.
6. We searched for companies which were undervalued on a relative
peer group basis for several fundamental metrics; i.e., ounce per
share, production per share, net asset value per share, cash flow
multiples.
CURRENT OUTLOOK
The gold market in China has shown a good follow-through in investor
interest after repealing the 50-year ban on gold ownership by
individuals in December of 2002. Several IPO's of local gold mining
companies in China were met with enthusiastic demand as the first two
issues were on average over 1000-times oversubscribed. Later in the year,
the broker sponsoring the third IPO had to print an additional 1.3
million application forms after running out of the first 1.2
million. In October, the Hong Kong edition of China Daily contained
comments from the Bank of China's gold business expert, saying it
would be safe and feasible for China to swap some foreign exchange
reserves for gold. It was also mentioned that local consumers could
pour $36 billion into gold, equivalent to 2,950 tonnes, or more than
one year of supply.
India continues to move forward with its gold deregulation plans.
There are now four national-level multi-commodity exchanges in
India, and trading in gold started in October after a 41-year ban.
There are also independent proposals to allow banks to offer
gold-backed investments to their clients, whereby the client would
deposit funds and receive gold at the maturity of the deposit
period. Late in the year, it was forecast that India's industrial
production might grow 20 percent faster than expected after record
harvests boosted incomes. This should fuel some incremental demand
for gold. Last year's crop production was very poor and had a
noticeable effect on gold demand. Both China and India are
responsible for about 28 percent of annual gold demand.
35
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GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
Exchange-traded gold funds that invest only in bullion may also be a
significant factor going forward. Gold Bullion Ltd.,(6) first listed
in Australia, had its debut listing in London during December. Plans
to list the investment vehicle in Paris, Hong Kong and the United
States are moving forward. At this point it is difficult to judge
the impact of this new product on the gold market, but it certainly
facilitates the ownership of physical gold by individuals and
institutional buyers. Also, of note, a recent Fortune magazine
article mentioned that Warren Buffett caused a stir by telling
readers that for the first time in 72 years, Berkshire Hathaway
Inc.(7) was investing in foreign currencies. One can only speculate
whether that includes gold. In the past, Mr. Buffett has taken up a
large position in silver.
Threats we are monitoring include: the potential liquidation of the
net-long gold futures position on the COMEX (the leading U.S. market
for metals futures and futures options), a sustainable reversal in
the U.S. dollar, rising U.S. interest rates, a significant economic
slowdown in China, profit-taking in the junior gold sector once
private placement shares are cleared for trading and the fact that
we have had three good quarters in a row in the gold market, which
may indicate it is due for a correction.
We continue to warn investors not to chase performance but to use
gold modestly as a 5 to 10 percent portion of their asset allocation
model. We also encourage investors to rebalance their portfolio once
per year to capture the swings in gold stocks. It is our job to
search for those companies which we believe will grow their reserves
and production profiles faster than their peers, thereby generating
superior relative peer group performance.
(1)The U.S. Trade-Weighted Dollar Index provides a general
indication of the international value of the U.S. dollar.
(2)This security comprised 7.83 percent of the total net assets of
the World Precious Minerals Fund and 10.93 percent of the total
net assets of the Gold Shares Fund as of December 31, 2003.
(3)This security comprised 2.11 percent of the total net assets of
the World Precious Minerals Fund and 3.15 percent of the total
net assets of the Gold Shares Fund as of December 31, 2003.
(4)This security comprised 5.30 percent of the total net assets of
the World Precious Minerals Fund and 4.34 percent of the total
net assets of the Gold Shares Fund as of December 31, 2003.
(5)This security comprised 5.85 percent of the total net assets of
the World Precious Minerals Fund and 8.75 percent of the total
net assets of the Gold Shares Fund as of December 31, 2003.
(6)This security comprised 0.03 percent of the total net assets of
the World Precious Minerals Fund and 0.05 percent of the total
net assets of the Gold Shares Fund as of December 31, 2003.
(7)Neither the World Precious Minerals Fund nor the Gold Shares Fund
held this security at December 31, 2003.
36
- -------------------------------------------------------------------------
GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
WORLD PRECIOUS MINERALS FUND
- -------------------------------------------------------------------------
TOP 10 EQUITY* HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2003
- -------------------------------------------------------------------------
WHEATON RIVER MINERALS LTD. 7.92%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
BEMA GOLD CORP. 5.92%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
NORTHERN ORION RESOURCES, INC. 5.36%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
PLACER DOME, INC. 4.20%
SENIOR GOLD PRODUCERS
---------------------------------------------------------------
BOLIVAR GOLD CORP. 3.23%
GOLD/MINERAL EXPLORATION & DEVELOPMENT
---------------------------------------------------------------
RIO NARCEA GOLD MINES LTD. 2.94%
GOLD/MINERAL EXPLORATION & DEVELOPMENT
---------------------------------------------------------------
NEWMONT MINING CORP. 2.90%
SENIOR GOLD PRODUCERS
---------------------------------------------------------------
IAMGOLD CORP. 2.84%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
APOLLO GOLD CORP. 2.75%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
GOLDCORP, INC. 2.15%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS December 31, 2003
- -------------------------------------------------------------------------
INTERMEDIATE & JUNIOR GOLD PRODUCERS 38.42%
GOLD/MINERAL EXPLORATION & DEVELOPMENT 25.96%
SENIOR GOLD PRODUCERS 10.64%
METAL & MINERAL MINING 7.97%
DIAMOND MINING & EXPLORATION 2.22%
*Includes convertible debentures.
37
- -------------------------------------------------------------------------
GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
GOLD SHARES FUND
- -------------------------------------------------------------------------
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2003
- -------------------------------------------------------------------------
WHEATON RIVER MINERALS LTD. 11.12%
GOLD MINING
---------------------------------------------------------------
BEMA GOLD CORP. 8.90%
GOLD MINING
---------------------------------------------------------------
ASHANTI GOLDFIELDS CO. LTD. 5.76%
GOLD MINING
---------------------------------------------------------------
PLACER DOME, INC. 4.91%
GOLD MINING
---------------------------------------------------------------
GOLDCORP, INC. 4.57%
GOLD MINING
---------------------------------------------------------------
NORTHERN ORION RESOURCES, INC. 4.42%
GOLD MINING
---------------------------------------------------------------
APOLLO GOLD CORP. 4.18%
GOLD MINING
---------------------------------------------------------------
NEWMONT MINING CORP. 3.45%
GOLD MINING
---------------------------------------------------------------
NORTHGATE EXPLORATION LTD. 3.20%
GOLD MINING
---------------------------------------------------------------
RIO NARCEA GOLD MINES LTD. 3.18%
GOLD MINING
- -------------------------------------------------------------------------
- -------------------------------------------------------------------------
TOP 5 INDUSTRIES BASED ON TOTAL INVESTMENTS December 31, 2003
- -------------------------------------------------------------------------
GOLD MINING 76.52%
METAL & MINERAL MINING 3.06%
MERCHANT BANKING 2.12%
DIAMOND MINING & EXPLORATION 1.07%
DIAMONDS & GOLD RETAIL 0.40%
38
- -------------------------------------------------------------------------
GOLD AND PRECIOUS MINERALS FUNDS
- -------------------------------------------------------------------------
WORLD PRECIOUS MINERALS FUND
- -------------------------------------------------------------------------
PORTFOLIO PROFILE December 31, 2003
- -------------------------------------------------------------------------
Country Distribution (based on domicile) % of Investments
---------------------------------------------------------------
Canada 71.65%
---------------------------------------------------------------
United States 17.85%
---------------------------------------------------------------
United Kingdom 2.90%
---------------------------------------------------------------
Austria 1.91%
---------------------------------------------------------------
Other Foreign 5.69%
- -------------------------------------------------------------------------
GOLD SHARES FUND
- -------------------------------------------------------------------------
PORTFOLIO PROFILE December 31, 2003
- -------------------------------------------------------------------------
Country Distribution (based on domicile) % of Investments
---------------------------------------------------------------
Canada 59.91%
---------------------------------------------------------------
United States 23.64%
---------------------------------------------------------------
Ghana 5.76%
---------------------------------------------------------------
South Africa 4.83%
---------------------------------------------------------------
Other Foreign 5.86%
- -------------------------------------------------------------------------
39
U.S. TREASURY SECURITIES CASH FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
UNITED STATES
GOVERNMENT COUPON MATURITY PRINCIPAL
OBLIGATIONS 58.02% RATE DATE AMOUNT VALUE
UNITED STATES
TREASURY BILLS 24.71%
- ------------------------------------------------------------------------------------
Yield 0.93% 01/02/04 $ 20,000,000 $ 20,000,000
Yield 0.87% 04/15/04 10,000,000 9,974,867
------------
29,974,867
UNITED STATES
TREASURY NOTES 33.31%
- ------------------------------------------------------------------------------------
3.00% 02/29/04 10,000,000 10,030,862
7.25% 05/15/04 10,000,000 10,224,544
2.88% 06/30/04 10,000,000 10,081,065
2.13% 08/31/04 10,000,000 10,060,310
------------
40,396,781
- ------------------------------------------------------------------------------------
TOTAL UNITED STATES
GOVERNMENT OBLIGATIONS 70,371,648
- ------------------------------------------------------------------------------------
(cost $70,371,648)
REPURCHASE AGREEMENTS 41.83%
Joint Tri-Party Repurchase
Agreements, 12/31/03,
collateralized by U.S.
Treasury securities held in
joint tri-party repurchase
accounts:
0.85% Credit Suisse First
Boston, repurchase price
$29,734,010 0.85% 01/02/04 29,732,606 29,732,606
0.84% UBS Financial Services,
Inc., repurchase price
$21,000,980 0.84% 01/02/04 21,000,000 21,000,000
- ------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENTS 50,732,606
- ------------------------------------------------------------------------------------
(cost $50,732,606)
- ------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.85% 121,104,254
- ------------------------------------------------------------------------------------
(cost $121,104,254)
Other assets and liabilities,
net 0.15% 176,653
------------
NET ASSETS 100% $121,280,907
------------
See notes to portfolios of investments and notes to financial
statements.
40
U.S. GOVERNMENT SECURITIES SAVINGS FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
UNITED STATES
GOVERNMENT AND AGENCY COUPON MATURITY PRINCIPAL
OBLIGATIONS 99.83% RATE DATE AMOUNT VALUE
FEDERAL FARM CREDIT BANK 0.53%
- ------------------------------------------------------------------------------------
Fixed Rates:
5.10% 04/26/04 $2,500,000 $ 2,531,263
FEDERAL HOME LOAN BANK 90.36%
- ------------------------------------------------------------------------------------
Discount Notes:
Yield 1.03% 01/02/04 36,561,000 36,561,000
Yield 0.75% 01/05/04 50,000,000 49,996,875
Yield 0.99% 01/07/04 30,000,000 29,995,881
Yield 1.03% 01/09/04 20,000,000 19,995,994
Yield 1.02% 01/16/04 43,274,000 43,256,815
Yield 1.06% 01/23/04 30,000,000 29,981,509
Yield 1.05% 01/30/04 20,000,000 19,983,589
Yield 1.03% 02/04/04 30,000,000 29,971,583
Yield 1.03% 02/18/04 15,000,000 14,979,829
Yield 1.00% 02/23/04 12,178,000 12,160,410
Yield 1.06% 03/05/04 26,644,000 26,594,794
Yield 1.02% 03/10/04 10,000,000 9,980,733
Fixed Rates:
6.49% 01/08/04 5,000,000 5,004,391
3.75% 02/13/04 14,365,000 14,409,713
5.25% 02/13/04 11,275,000 11,329,204
6.02% 03/22/04 2,000,000 2,021,222
3.75% 04/15/04 5,000,000 5,037,191
4.88% 05/14/04 2,000,000 2,026,910
5.90% 06/02/04 500,000 509,604
3.38% 06/15/04 4,000,000 4,037,142
6.57% 06/18/04 6,500,000 6,660,448
4.75% 06/28/04 500,000 508,542
7.36% 07/01/04 925,000 952,829
4.63% 08/13/04 6,750,000 6,883,918
6.25% 08/13/04 7,095,000 7,308,963
1.20% 08/20/04 5,000,000 5,000,000
1.36% 09/03/04 5,000,000 4,999,066
1.40% 09/17/04 5,000,000 5,000,391
6.78% 09/17/04 500,000 518,840
1.25% 09/22/04 5,000,000 5,000,000
1.41% 11/12/04 5,000,000 5,000,000
6.25% 11/15/04 3,780,000 3,935,887
6.50% 11/15/04 2,000,000 2,086,766
1.53% 11/19/04 5,000,000 5,000,000
See notes to portfolios of investments and notes to financial
statements.
41
U.S. GOVERNMENT SECURITIES SAVINGS FUND
- ----------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------------
UNITED STATES
GOVERNMENT AND AGENCY COUPON MATURITY PRINCIPAL
OBLIGATIONS RATE DATE AMOUNT VALUE
FEDERAL HOME LOAN BANK (CONT'D)
- ----------------------------------------------------------------------------------
1.63% 12/08/04 $5,000,000 $ 5,000,000
------------
431,690,039
STUDENT LOAN MARKETING
ASSOCIATION 8.94%
- ----------------------------------------------------------------------------------
Discount Notes:
Yield 0.75% 01/05/04 18,689,000 18,687,832
Yield 0.98% 01/06/04 20,000,000 19,997,822
Fixed Rates:
3.38% 07/15/04 4,000,000 4,042,522
------------
42,728,176
- ----------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.83% 476,949,478
- ----------------------------------------------------------------------------------
(cost $476,949,478)
Other assets and liabilities,
net 0.17% 791,300
------------
NET ASSETS 100% $477,740,778
------------
------------
See notes to portfolios of investments and notes to financial
statements.
42
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS 95.58% RATE DATE AMOUNT VALUE
ALABAMA 1.38%
- ------------------------------------------------------------------------------------
DCH Health Care Authority Facilities
Revenue 5.00% 06/01/09 $250,000 $ 271,015
ARIZONA 2.83%
- ------------------------------------------------------------------------------------
Arizona State Transportation Board,
Series A 5.00% 07/01/09 300,000 335,565
Maricopa County, Arizona Unified School
District, GO 4.85% 07/01/11 200,000 221,826
----------
557,391
ARKANSAS 2.13%
- ------------------------------------------------------------------------------------
Arkansas State Community Water System
Public Water Authority Revenue 2.40% 10/01/05 200,000 200,396
Little Rock Arkansas Health Facilities
Board Hospital Revenue 6.80% 11/01/05 200,000 218,836
----------
419,232
CALIFORNIA 8.67%
- ------------------------------------------------------------------------------------
Association of Bay Area Governments
(ABAG) Finance Authority, Series C 4.00% 03/01/08 100,000 101,663
California State, GO 6.40% 02/01/06 500,000 548,545
California State, Series G, GO 5.50% 06/01/11 170,000 188,856
Chino Basin Regional Financing Authority
Revenue 7.00% 08/01/06 250,000 283,440
Modesto Irrigation District Financing
Authority Revenue Domestic Water
Project, Series C 5.75% 09/01/15 200,000 218,382
Santa Clara County Financing Authority
Revenue 4.00% 08/01/06 350,000 368,252
----------
1,709,138
COLORADO 3.92%
- ------------------------------------------------------------------------------------
Adams & Arapahoe Counties Joint School
District, Series C, GO 5.75% 12/01/07 100,000 112,989
Colorado Springs Sales & Use Tax Revenue 5.00% 12/01/11 200,000 221,464
Platte River Power Authority Revenue,
Series FF 5.00% 06/01/07 400,000 437,068
----------
771,521
CONNECTICUT 3.37%
- ------------------------------------------------------------------------------------
Bridgeport, Series A, GO 6.00% 03/01/06 200,000 217,920
Connecticut State, Series C, GO 5.00% 12/15/08 400,000 447,092
----------
665,012
See notes to portfolios of investments and notes to financial
statements.
43
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
DELAWARE 3.35%
- ------------------------------------------------------------------------------------
Delaware State, Series A, GO 4.25% 03/01/09 $400,000 $ 432,932
Delaware Transportation Authority System
Revenue 5.50% 07/01/08 200,000 226,242
----------
659,174
DISTRICT OF COLUMBIA 0.86%
- ------------------------------------------------------------------------------------
District of Columbia, Unrefunded,
Series B 5.50% 06/01/09 150,000 170,145
FLORIDA 4.67%
- ------------------------------------------------------------------------------------
Florida State Board of Education Capital
Outlay, Series B, GO 5.25% 06/01/11 175,000 194,199
Hillsborough County Industrial
Development Authority Hospital Revenue 3.50% 10/01/09 205,000 200,404
Jacksonville Transportation Authority,
GO 6.50% 07/01/07 280,000 321,306
JEA Electric System Revenue, Series 3B 4.00% 10/01/12 200,000 204,380
----------
920,289
GEORGIA 5.48%
- ------------------------------------------------------------------------------------
Atlanta Development Authority Revenue,
Series A 5.25% 07/01/12 375,000 407,977
Coweta County School District, GO 4.00% 08/01/06 175,000 184,669
Georgia Municipal Electric Authority
Power Revenue, Series A 5.30% 01/01/07 100,000 109,886
Marietta Georgia Development Authority
Revenue 3.00% 09/15/08 375,000 376,976
----------
1,079,508
ILLINOIS 1.21%
- ------------------------------------------------------------------------------------
Chicago Water Revenue (ZCB) 0.00% 11/01/08 275,000 238,120
INDIANA 1.29%
- ------------------------------------------------------------------------------------
Indianapolis, Indiana Local Public
Improvement Bond Bank, Series D 6.60% 02/01/07 225,000 254,941
IOWA 1.09%
- ------------------------------------------------------------------------------------
Iowa Finance Authority Hospital Facility
Revenue, Trinity Regional Hospital
Project 5.15% 07/01/04 210,000 214,194
KENTUCKY 1.45%
- ------------------------------------------------------------------------------------
Kentucky Infrastructure Authority
Revenue, Series K 3.00% 08/01/05 280,000 284,956
LOUISIANA 1.13%
- ------------------------------------------------------------------------------------
Shreveport, Louisiana, Series A, GO 5.25% 05/01/10 200,000 223,070
See notes to portfolios of investments and notes to financial
statements.
44
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
MARYLAND 2.11%
- ------------------------------------------------------------------------------------
Baltimore County, GO Unlimited Tax 5.00% 06/01/05 $165,000 $ 173,600
Maryland State Economic Development
Corporation Student Housing Revenue,
Frostburg State University Project 3.25% 10/01/04 240,000 241,615
----------
415,215
MASSACHUSETTS 1.23%
- ------------------------------------------------------------------------------------
Massachusetts State Health & Educational
Facilities Authority Revenue, Series D 5.00% 10/01/07 135,000 134,128
Massachusetts State, Series C, GO 4.625% 10/01/08 100,000 109,167
----------
243,295
MICHIGAN 0.69%
- ------------------------------------------------------------------------------------
Detroit, Michigan Local Development
Financial Authority, Series A 5.20% 05/01/10 130,000 136,590
MISSISSIPPI 3.06%
- ------------------------------------------------------------------------------------
Mississippi Development Bank Special
Obligation 3.25% 11/01/07 300,000 304,197
Mississippi Hospital Equipment &
Facilities Authority Revenue 3.45% 04/01/07 300,000 299,352
----------
603,549
NEVADA 2.65%
- ------------------------------------------------------------------------------------
Nevada State Municipal Bond Bank Project
#51, Series A, GO 5.10% 01/01/08 250,000 267,190
Washoe County Gas & Water Facilities,
Revenue 6.30% 12/01/14 250,000 254,612
----------
521,802
NEW JERSEY 3.13%
- ------------------------------------------------------------------------------------
Jersey City, GO 6.00% 10/01/05 110,000 118,409
New Jersey State 5.125% 05/01/10 250,000 282,355
Washington Township Board of Education,
GO 5.10% 02/01/08 200,000 216,810
----------
617,574
NEW MEXICO 0.61%
- ------------------------------------------------------------------------------------
New Mexico State Highway Commission
Revenue 3.75% 06/15/06 115,000 120,671
NEW YORK 9.18%
- ------------------------------------------------------------------------------------
Hempstead Township, Series B, GO
Unlimited Tax 5.375% 11/15/10 120,000 134,030
New York City Transitional Financial
Authority Revenue, Series A 5.25% 11/01/08 225,000 252,967
See notes to portfolios of investments and notes to financial
statements.
45
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
NEW YORK (CONT'D)
- ------------------------------------------------------------------------------------
New York, New York, Series B 5.25% 08/01/09 $200,000 $ 221,262
New York, New York, Series C 3.50% 08/01/07 300,000 309,765
New York State, GO 5.00% 03/01/08 250,000 276,060
New York State, Local Highway & Bridge,
Series A 5.375% 04/01/10 200,000 225,986
New York State, Medical Care Facilities
Financial Agency Revenue, Series D 5.10% 02/15/06 250,000 270,345
Schenectady Metroplex Development
Authority Revenue, Series A 5.00% 12/15/12 110,000 119,404
----------
1,809,819
NORTH CAROLINA 0.99%
- ------------------------------------------------------------------------------------
North Carolina Eastern Municipal Power
Agency Revenue, Refunding, Series A 5.60% 01/01/10 175,000 194,142
OHIO 3.82%
- ------------------------------------------------------------------------------------
Dayton Ohio City School District,
Series D 4.00% 12/01/09 500,000 536,875
Ohio State Higher Education, Series B,
GO 4.25% 11/01/07 200,000 215,470
----------
752,345
OREGON 1.81%
- ------------------------------------------------------------------------------------
Clackamas County Hospital Facilities
Authority Revenue 5.00% 05/01/07 200,000 215,428
Oregon State Department Transportation
Highway 5.00% 11/15/09 125,000 140,610
----------
356,038
PUERTO RICO 1.06%
- ------------------------------------------------------------------------------------
Puerto Rico Commonwealth Highway &
Transportation Authority Revenue,
Series F 5.00% 07/01/05 200,000 209,494
SOUTH CAROLINA 1.89%
- ------------------------------------------------------------------------------------
Horry County Hospitality Fee Special
Obligation 5.00% 04/01/10 200,000 221,976
South Carolina State Public Service
Commission Authority Revenue, Series C 4.50% 01/01/04 150,000 150,000
----------
371,976
TENNESSEE 1.58%
- ------------------------------------------------------------------------------------
Shelby County Tennessee Health
Educational & Housing Facilities Board
Revenue 5.15% 07/01/07 300,000 311,715
See notes to portfolios of investments and notes to financial
statements.
46
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
TEXAS 12.53%
- ------------------------------------------------------------------------------------
Arlington Refunded, Series A 5.00% 08/15/08 $200,000 $ 222,672
Austin Utility System Revenue, Series A 5.375% 11/15/05 200,000 204,632
Bexar County Refunded, GO 5.40% 06/15/12 200,000 215,230
Gulf Coast Industrial Development
Authority Pollution Control Revenue 4.95% 07/01/07 385,000 424,840
Killeen, Texas Independent School
District System, GO 5.00% 02/15/09 400,000 439,124
San Antonio Water System Revenue 5.00% 05/15/13 100,000 109,188
Texas State Affordable Housing Corp. 4.00% 11/01/06 315,000 318,169
Texas State Water Development Board
Revenue, Series A 5.125% 07/15/09 290,000 313,922
Texas Turnpike Authority Revenue 5.00% 06/01/08 200,000 220,996
----------
2,468,773
UTAH 1.11%
- ------------------------------------------------------------------------------------
Utah Transit Authority Sales Tax &
Transportation Revenue 4.90% 12/15/09 200,000 219,406
WASHINGTON 3.42%
- ------------------------------------------------------------------------------------
Clark County, Washington School
District, GO Unlimited 5.125% 12/01/11 100,000 113,145
Washington State, Series A, GO 5.25% 07/01/09 500,000 561,460
----------
674,605
WISCONSIN 1.88%
- ------------------------------------------------------------------------------------
Milwaukee, Wisconsin, Series L, GO 4.60% 12/15/13 150,000 165,806
Wisconsin Health & Educational
Facilities Authority Revenue 5.20% 06/01/05 200,000 204,308
----------
370,114
- ------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS 18,834,829
- ------------------------------------------------------------------------------------
(cost $18,332,172)
See notes to portfolios of investments and notes to financial
statements.
47
NEAR-TERM TAX FREE FUND
- ------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
REPURCHASE AGREEMENT 3.49% RATE DATE AMOUNT VALUE
Joint Tri-Party Repurchase Agreement,
Credit Suisse First Boston, 12/31/03,
0.85%, due 01/02/04, repurchase price
$687,524, collateralized by U.S.
Treasury securities held in a joint
tri-party repurchase
account (cost $687,492) 0.85% 01/02/04 $687,492 $ 687,492
- ------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.07% 19,522,321
- ------------------------------------------------------------------------------------
(cost $19,019,664)
Other assets and liabilities, net 0.93% 184,005
-----------
NET ASSETS 100% $19,706,326
-----------
-----------
See notes to portfolios of investments and notes to financial
statements.
48
TAX FREE FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS 98.58% RATE DATE AMOUNT VALUE
ALABAMA 5.91%
- -------------------------------------------------------------------------------------
Alabama Public School & College
Authority, Series B 5.00% 12/01/20 $1,350,000 $ 1,415,516
Birmingham GO Unlimited, Series A 5.50% 04/01/13 1,000,000 1,152,930
-----------
2,568,446
ARIZONA 4.28%
- -------------------------------------------------------------------------------------
Arizona State Transportation Board
Highway Revenue, Series B 5.25% 07/01/21 1,415,000 1,523,601
Salt River Project Agricultural
Improvement & Power District Electric
System Revenue 6.00% 01/01/07 300,000 335,079
-----------
1,858,680
ARKANSAS 1.40%
- -------------------------------------------------------------------------------------
Arkansas State Community Water System
Public Water Authority Revenue 2.40% 10/01/05 300,000 300,594
Gravette Arkansas School District, GO
Unlimited, Series B 4.00% 06/01/09 290,000 306,153
-----------
606,747
CALIFORNIA 5.72%
- -------------------------------------------------------------------------------------
California State, GO Unlimited 5.00% 12/01/06 690,000 740,598
California State, GO Unlimited 5.125% 06/01/23 300,000 300,618
San Jose, California Library Parks &
Public Safety Projects 5.00% 09/01/28 400,000 410,504
University of California Revenue,
Series K 5.00% 09/01/21 1,000,000 1,035,700
-----------
2,487,420
COLORADO 3.74%
- -------------------------------------------------------------------------------------
Denver, Colorado City & County School
District #1, GO Unlimited 5.00% 12/01/23 410,000 423,530
Platte River Power Authority Revenue,
Series FF 5.00% 06/01/07 1,100,000 1,201,937
-----------
1,625,467
CONNECTICUT 0.51%
- -------------------------------------------------------------------------------------
Hartford County Metropolitan District 8.25% 05/01/04 215,000 219,861
FLORIDA 5.09%
- -------------------------------------------------------------------------------------
Florida Board of Education Capital
Outlay, GO Unlimited Tax, Refunding,
Series A 6.625% 06/01/07 505,000 527,331
Florida State Board of Education,
Series A 5.00% 06/01/18 1,000,000 1,070,770
See notes to portfolios of investments and notes to financial
statements.
49
TAX FREE FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
FLORIDA (CONT'D)
- -------------------------------------------------------------------------------------
North Broward, Florida Hospital
District Revenue 4.70% 01/15/06 $ 595,000 $ 614,248
-----------
2,212,349
GEORGIA 4.02%
- -------------------------------------------------------------------------------------
Atlanta Development Authority Revenue 5.25% 07/01/22 500,000 521,635
Atlanta Development Authority Revenue,
Series A 5.25% 07/01/12 550,000 598,367
Georgia Municipal Electric Authority
Power Revenue, Series A 5.30% 01/01/07 200,000 219,772
Marietta Georgia Development Authority
Revenue 3.35% 09/15/10 410,000 408,987
-----------
1,748,761
ILLINOIS 6.34%
- -------------------------------------------------------------------------------------
Chicago, Illinois Motor Fuel Tax
Revenue 5.375% 01/01/14 1,000,000 1,146,530
Du Page County, Refunding 5.60% 01/01/21 490,000 563,039
Illinois Development Financing
Authority Hospital Revenue, Adventist
Health Systems 5.65% 11/15/24 435,000 442,164
Illinois Development Financing
Authority Revenue Presbyterian Home
Lake Project, Series B 6.25% 09/01/17 250,000 276,810
Illinois Regional Transportation
Authority Revenue, Series A 7.20% 11/01/20 250,000 326,085
-----------
2,754,628
IOWA 1.22%
- -------------------------------------------------------------------------------------
Polk County Revenue Catholic Health
Initiatives, Series A 5.125% 12/01/11 500,000 532,430
KANSAS 2.61%
- -------------------------------------------------------------------------------------
Kansas State Development Finance
Authority Hospital Revenue, Series Z 5.00% 12/15/12 500,000 547,705
University of Kansas Hospital Authority
Health Facilities Revenue 5.625% 09/01/27 570,000 587,647
-----------
1,135,352
KENTUCKY 1.81%
- -------------------------------------------------------------------------------------
Kentucky Infrastructure Authority
Revenue, Series K 3.00% 08/01/05 350,000 356,195
Louisville & Jefferson County Regional
Airport Authority, Series B 5.00% 07/01/14 400,000 431,364
-----------
787,559
See notes to portfolios of investments and notes to financial
statements.
50
TAX FREE FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
LOUISIANA 0.87%
- -------------------------------------------------------------------------------------
Opelousas Louisiana General Hospital
Authority Revenue 4.60% 10/01/11 $ 375,000 $ 375,979
MARYLAND 1.52%
- -------------------------------------------------------------------------------------
Maryland State Economic Development
Corporation Student Housing Revenue,
Salisbury University Project 4.00% 06/01/12 360,000 345,377
Maryland State Health & Higher
Educational Facilities Authority
Revenue 5.75% 07/01/21 300,000 316,413
-----------
661,790
MASSACHUSETTS 1.17%
- -------------------------------------------------------------------------------------
Massachusetts State Authority Revenue,
Series A 5.00% 07/01/27 500,000 507,760
MICHIGAN 5.58%
- -------------------------------------------------------------------------------------
Belding Area Schools, Refunding 5.00% 05/01/18 390,000 409,403
Detroit, Michigan Local Development
Financing Authority, Refunding,
Series A 5.375% 05/01/18 300,000 304,845
Michigan State Hospital Finance
Authority Revenue 4.90% 05/15/13 500,000 532,555
St. Clair County, GO 4.50% 04/01/15 1,115,000 1,179,213
-----------
2,426,016
MISSISSIPPI 3.68%
- -------------------------------------------------------------------------------------
Mississippi Development Bank, GO
Unlimited 6.00% 12/01/08 400,000 452,068
Mississippi State, GO Unlimited,
Series A 5.375% 12/01/11 1,000,000 1,147,270
-----------
1,599,338
MISSOURI 1.03%
- -------------------------------------------------------------------------------------
St. Louis Airport Development Program,
Series A 5.00% 07/01/11 400,000 445,684
NEW JERSEY 4.32%
- -------------------------------------------------------------------------------------
New Jersey Health Care Facilities
Financing Authority Revenue 4.375% 07/01/10 460,000 490,300
New Jersey State Transportation
Authority, Series A 5.00% 06/15/13 315,000 338,798
Somerset Hills School District, GO
Unlimited 4.00% 03/15/14 1,015,000 1,048,434
-----------
1,877,532
NEW MEXICO 0.48%
- -------------------------------------------------------------------------------------
New Mexico State Highway Commission
Revenue 3.75% 06/15/06 200,000 209,862
See notes to portfolios of investments and notes to financial
statements.
51
TAX FREE FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
NEW YORK 6.37%
- -------------------------------------------------------------------------------------
Albany Parking Authority Revenue 5.00% 07/15/09 $ 400,000 $ 430,444
New York, GO Unlimited, Series G 5.00% 08/01/05 1,000,000 1,051,360
New York, GO Unlimited, Series H 5.25% 03/15/14 450,000 479,646
New York, GO Unlimited, Series J 5.00% 05/15/12 250,000 266,265
Tobacco Settlement Financing Corp.,
Series B 5.00% 06/01/08 500,000 542,685
-----------
2,770,400
NORTH CAROLINA 1.28%
- -------------------------------------------------------------------------------------
North Carolina Eastern Municipal Power
Agency Revenue, Refunding, Series A 5.60% 01/01/10 500,000 554,690
OHIO 4.59%
- -------------------------------------------------------------------------------------
Cleveland, Ohio, GO 5.50% 12/01/13 1,000,000 1,160,530
Ohio State Mental Health Facilities
Revenue 5.50% 06/01/15 300,000 335,538
Olentangy Local School District, GO
Limited Tax, Series A 6.25% 12/01/15 240,000 255,936
South Euclid Special Assessment, GO
Limited Tax 6.70% 12/01/14 200,000 243,746
-----------
1,995,750
PENNSYLVANIA 3.87%
- -------------------------------------------------------------------------------------
Chester County Health & Educational
Facilities Authority Revenue 5.00% 05/15/08 250,000 276,318
Delaware Valley, Pennsylvania Regional
Financing Authority Local Government
Revenue, Series A 5.50% 08/01/28 1,000,000 1,133,560
Philadelphia Hospital & Higher
Educational Facilities Authority
Revenue 4.95% 06/15/06 265,000 272,160
-----------
1,682,038
PUERTO RICO 2.37%
- -------------------------------------------------------------------------------------
Puerto Rico Commonwealth Public
Improvement, GO Unlimited 5.50% 07/01/17 610,000 713,645
Puerto Rico Electric Power Authority
Revenue, Series II 5.125% 07/01/26 300,000 316,344
-----------
1,029,989
RHODE ISLAND 2.51%
- -------------------------------------------------------------------------------------
North Providence, GO Unlimited Tax,
Series A 6.05% 07/01/13 500,000 579,405
Rhode Island State Health & Educational
Building Corporation Revenue 6.50% 08/15/32 500,000 511,275
-----------
1,090,680
See notes to portfolios of investments and notes to financial
statements.
52
TAX FREE FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
SOUTH CAROLINA 0.59%
- -------------------------------------------------------------------------------------
South Carolina Jobs Economic
Development Authority Revenue 5.00% 11/01/23 $ 250,000 $ 256,990
TEXAS 8.51%
- -------------------------------------------------------------------------------------
Austin Utility System Revenue, Series A 5.375% 11/15/05 300,000 306,948
Austin, Texas, GO 5.00% 09/01/16 565,000 597,431
Bexar County, GO Limited Tax 5.00% 06/15/18 500,000 526,850
Clear Lake City Water Authority, GO
Unlimited 5.00% 03/01/18 500,000 522,985
San Antonio Water Revenue System 5.00% 05/15/25 300,000 306,810
Texas Turnpike Authority Revenue 5.00% 06/01/08 1,300,000 1,436,474
-----------
3,697,498
UTAH 0.76%
- -------------------------------------------------------------------------------------
Weber County School District, Series A 5.15% 06/15/08 300,000 328,341
VERMONT 0.67%
- -------------------------------------------------------------------------------------
Vermont Educational & Health Buildings
Financing Agency Revenue, Vermont Law
School Project, Series A 5.375% 01/01/23 300,000 290,091
VIRGINIA 2.53%
- -------------------------------------------------------------------------------------
Fairfax County, Virginia, GO Unlimited,
Series A 5.00% 06/01/07 1,000,000 1,100,970
WASHINGTON 3.23%
- -------------------------------------------------------------------------------------
King & Snohomish Counties' School
District, Series C 5.00% 06/15/10 250,000 278,568
Washington State, GO Unlimited,
Series A 5.625% 07/01/17 1,000,000 1,125,420
-----------
1,403,988
- -------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS 42,843,086
- -------------------------------------------------------------------------------------
(cost $41,376,570)
See notes to portfolios of investments and notes to financial
statements.
53
TAX FREE FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COUPON MATURITY PRINCIPAL
REPURCHASE AGREEMENT 0.61% RATE DATE AMOUNT VALUE
Joint Tri-Party Repurchase Agreement,
Credit Suisse First Boston, 12/31/03,
0.85%, due 01/02/04, repurchase price
$266,136, collateralized by U.S.
Treasury securities held in a
joint tri-party repurchase
account (cost $266,123) 0.85% 01/02/04 $ 266,123 $ 266,123
- -------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.19% 43,109,209
- -------------------------------------------------------------------------------------
(cost $41,642,693)
Other assets and liabilities, net 0.81% 352,364
-----------
NET ASSETS 100% $43,461,573
-----------
-----------
See notes to portfolios of investments and notes to financial
statements.
54
ALL AMERICAN EQUITY FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS 93.57% SHARES VALUE
ADVERTISING 1.00%
- -------------------------------------------------------------------------------------
Harris Interactive, Inc. 6,000 $ 49,800*
Omnicom Group, Inc. 1,800 157,194
-----------
206,994
AGRICULTURE PRODUCTS 0.47%
- -------------------------------------------------------------------------------------
Archer Daniels Midland Co. 6,400 97,408*
BANKS 6.84%
- -------------------------------------------------------------------------------------
Bank of America Corp. 2,800 225,204
Commerce Bancorp, Inc. 3,600 189,648*
National Commerce Financial Corp. 3,600 98,208
New York Community Bancorp, Inc. 6,133 233,361
SouthTrust Corp. 3,000 98,190
UCBH Holdings, Inc. 10,000 389,700
Wells Fargo & Co. 3,000 176,670
-----------
1,410,981
BEVERAGES 1.19%
- -------------------------------------------------------------------------------------
Anheuser-Busch Companies, Inc. 2,000 105,360
PepsiCo, Inc. 3,000 139,860
-----------
245,220
BIOTECHNOLOGY 1.32%
- -------------------------------------------------------------------------------------
Amgen, Inc. 4,400 271,920*
CHEMICALS & ALLIED PRODUCTS 1.78%
- -------------------------------------------------------------------------------------
Dow Chemical Co. 2,800 116,396
E.I. du Pont de Nemours and Co. 2,300 105,547
Millennium Chemicals, Inc. 11,500 145,820
-----------
367,763
COMPUTER & OFFICE EQUIPMENT 3.42%
- -------------------------------------------------------------------------------------
Cisco Systems, Inc. 20,700 502,803*
Dell Inc. 2,240 76,070
Sun Microsystems, Inc. 28,000 125,720
-----------
704,593
COMPUTER SERVICES 1.65%
- -------------------------------------------------------------------------------------
Affiliated Computer Services, Inc. 4,400 239,624*
EarthLink, Inc. 10,000 100,000*
-----------
339,624
See notes to portfolios of investments and notes to financial
statements.
55
ALL AMERICAN EQUITY FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
CONSTRUCTION 2.01%
- -------------------------------------------------------------------------------------
Chicago Bridge & Iron Company N.V., ADR 7,000 $ 202,300
Dycom Industries, Inc. 6,000 160,920*
M.D.C. Holdings, Inc. 800 51,600
-----------
414,820
CONSULTING 1.40%
- -------------------------------------------------------------------------------------
Accenture Ltd., Class A 4,200 110,544*
Tetra Tech, Inc. 7,200 178,992*
-----------
289,536
COSMETICS 0.98%
- -------------------------------------------------------------------------------------
Avon Products, Inc. 2,000 134,980
The Estee Lauder Companies, Inc., Class A 1,700 66,742
-----------
201,722
DATA PROCESSING & SOFTWARE 5.15%
- -------------------------------------------------------------------------------------
eFunds Corp. 9,000 156,150*
First Data Corp. 6,000 246,540
Microsoft Corp. 13,300 366,282
NetScreen Technologies, Inc. 10,100 249,975*
Stockgroup Information Systems, Inc. 150,000 44,250*
-----------
1,063,197
E-COMMERCE/SERVICES 0.59%
- -------------------------------------------------------------------------------------
InterActiveCorp. 3,600 122,148*
EDUCATION 0.85%
- -------------------------------------------------------------------------------------
Apollo Group, Inc., Class A 1,800 122,400*
Leapfrog Enterprises, Inc. 2,000 53,060*
-----------
175,460
ELECTRONICS & COMPONENTS 6.27%
- -------------------------------------------------------------------------------------
Analog Devices, Inc. 2,500 114,125*
Comtech Telecommunications Corp. 3,400 98,158*
Intel Corp. 8,560 275,632
Jabil Circuit, Inc. 3,400 96,220*
Novellus Systems, Inc. 4,400 185,020*
Silicon Laboratories, Inc. 1,000 43,220*
STMicroelectronics N.V. 4,000 108,040*
Texas Instruments, Inc. 10,900 320,242
TiVo, Inc. 7,000 51,800*
-----------
1,292,457
See notes to portfolios of investments and notes to financial
statements.
56
ALL AMERICAN EQUITY FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
FINANCIAL SERVICES 9.53%
- -------------------------------------------------------------------------------------
American Express Co. 4,600 $ 221,858
Capital One Financial Corp. 1,900 116,451
Citigroup, Inc. 8,500 412,590
Countrywide Financial Corp. 2,000 151,700
Digital Insight Corp. 5,500 136,950*
J.P. Morgan Chase & Co. 4,700 172,631
Legg Mason, Inc. 4,200 324,156
Lehman Brothers Holdings, Inc. 2,000 154,440
Morgan Stanley Dean Witter & Co. 3,200 185,184
The Charles Schwab Corp. 7,600 89,984
-----------
1,965,944
FORESTRY 0.43%
- -------------------------------------------------------------------------------------
Louisiana-Pacific Corp. 5,000 89,400*
GAMING 0.66%
- -------------------------------------------------------------------------------------
Scientific Games Corp., Class A 8,000 136,080*
HEALTHCARE DISTRIBUTORS 2.53%
- -------------------------------------------------------------------------------------
AmerisourceBergen Corp., Class A 4,000 224,600
Cardinal Health, Inc. 3,000 183,480
Express Scripts, Inc. 1,700 112,931*
-----------
521,011
HEALTHCARE EQUIPMENT & FACILITIES 1.71%
- -------------------------------------------------------------------------------------
Medtronic, Inc. 2,800 136,108
VCA Antech, Inc. 7,000 216,860*
-----------
352,968
HOUSEHOLD APPLIANCES 1.95%
- -------------------------------------------------------------------------------------
General Electric Co. 13,000 402,740
HUMAN RESOURCES 0.53%
- -------------------------------------------------------------------------------------
Labor Ready, Inc. 8,400 110,040*
INSURANCE 2.97%
- -------------------------------------------------------------------------------------
ACE Ltd. 4,000 165,680
American International Group, Inc. 2,200 145,816
ProAssurance Corp. 3,000 96,450*
The Chubb Corp. 3,000 204,300
-----------
612,246
See notes to portfolios of investments and notes to financial
statements.
57
ALL AMERICAN EQUITY FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
INVESTMENT TRUSTS 1.82%
- -------------------------------------------------------------------------------------
KCP Income Fund 10,000 $ 94,380
Technology Select Sector SPDR Fund 13,800 281,244
-----------
375,624
MANAGED HEALTH CARE 1.08%
- -------------------------------------------------------------------------------------
Pacificare Health Systems, Inc. 1,000 67,600
UnitedHealth Group, Inc. 1,400 81,452
WellPoint Health Networks, Inc. 750 72,743*
-----------
221,795
MANUFACTURING 2.88%
- -------------------------------------------------------------------------------------
3M Co. 1,400 119,042*
Caterpillar, Inc. 1,200 99,624
Illinois Tool Works, Inc. 1,400 117,474
Ingersoll-Rand Co., Class A 2,200 149,336
Joy Global, Inc. 2,200 57,530
Oshkosh Truck Corp. 1,000 51,030*
-----------
594,036
METAL & MINERAL MINING 8.46%
- -------------------------------------------------------------------------------------
Aber Diamond Corp. 2,000 72,734*
Alcoa, Inc. 3,400 129,200
Apollo Gold Corp., Warrants (March 2004) 78,125 53,906*
Bema Gold Corp., Warrants (October 2007) 50,000 126,484*
Freeport-McMoRan Copper & Gold, Inc., Class B 8,350 351,786
Inco Ltd. 3,000 119,460*
Kinross Gold Corp., Warrants (December 2007) 100,000 91,285*
Phelps Dodge Corp. 1,300 98,917*
United States Steel Corp. 3,500 122,570
Wheaton River Minerals Ltd., Warrants (May 2007) 325,000 579,430*
-----------
1,745,772
OIL & GAS DRILLING 2.03%
- -------------------------------------------------------------------------------------
Nabors Industries, Inc. 4,000 166,000*
Patterson-UTI Energy, Inc. 5,000 164,600*
Precision Drilling Corp. 2,000 87,360*
-----------
417,960
OIL & GAS EXPLORATION & PRODUCTION 2.55%
- -------------------------------------------------------------------------------------
Burlington Resources, Inc. 1,000 55,380*
Chesapeake Energy Corp. 8,000 108,640
Devon Energy Corp. 1,000 57,260*
See notes to portfolios of investments and notes to financial
statements.
58
ALL AMERICAN EQUITY FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
OIL & GAS EXPLORATION & PRODUCTION (CONT'D)
- -------------------------------------------------------------------------------------
EOG Resources, Inc. 2,300 $ 106,191*
Galaxy Energy Corp. 39,500 103,095*
Pioneer Natural Resources Co. 3,000 95,790*
-----------
526,356
OIL & GAS FIELD SERVICES 0.70%
- -------------------------------------------------------------------------------------
Key Energy Services, Inc. 14,000 144,340*
OIL & GAS ROYALTY TRUSTS 2.44%
- -------------------------------------------------------------------------------------
Enerplus Resources Fund 13,000 395,720
San Juan Basin Royalty Trust 5,000 108,450
-----------
504,170
PAPER PRODUCTS 1.21%
- -------------------------------------------------------------------------------------
Georgia-Pacific Corp. 5,000 153,350
Sappi Ltd., Sponsored ADR 7,000 95,690*
-----------
249,040
PHARMACEUTICALS 4.17%
- -------------------------------------------------------------------------------------
Eli Lilly & Co. 3,100 218,023
Johnson & Johnson 3,700 191,142
Pfizer, Inc. 8,675 306,488
Wyeth 3,400 144,330
-----------
859,983
RESTAURANTS 0.95%
- -------------------------------------------------------------------------------------
Applebee's International, Inc. 4,000 157,080
Starbucks Corp. 1,200 39,672*
-----------
196,752
RETAIL 4.53%
- -------------------------------------------------------------------------------------
Best Buy Co., Inc. 1,300 67,912
Claire's Stores, Inc. 8,400 158,256
Pacific Sunwear of California, Inc. 2,500 52,800*
The Finish Line, Inc., Class A 5,900 176,823*
Tractor Supply Co. 3,100 120,559*
Urban Outfitters, Inc. 2,800 103,740*
Wal-Mart Stores, Inc. 4,780 253,579
-----------
933,669
See notes to portfolios of investments and notes to financial
statements.
59
ALL AMERICAN EQUITY FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
SHIPPING 0.67%
- -------------------------------------------------------------------------------------
Union Pacific Corp. 2,000 $ 138,960
SHOES 0.37%
- -------------------------------------------------------------------------------------
K-Swiss, Inc., Class A 3,200 76,992
TELECOMMUNICATIONS 1.08%
- -------------------------------------------------------------------------------------
Stream Communications Network, Inc. 190,000 222,300*
TOYS 0.39%
- -------------------------------------------------------------------------------------
Hasbro, Inc. 3,800 80,864*
UTILITIES 1.39%
- -------------------------------------------------------------------------------------
El Paso Corp. 7,000 57,330
Kinder Morgan Energy Partners, L.P. 2,500 123,175
Sempra Energy 3,500 105,210
-----------
285,715
WHOLESALE & DISTRIBUTION 1.62%
- -------------------------------------------------------------------------------------
Costco Wholesale Corp. 3,000 111,540*
SYSCO Corp. 6,000 223,380
-----------
334,920
- -------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 19,303,520
- -------------------------------------------------------------------------------------
(cost $15,778,121)
PREFERRED STOCK 1.05%
METAL & MINERAL MINING 1.05%
- -------------------------------------------------------------------------------------
Freeport-McMoRan Copper & Gold, Inc., Depositary
Shares representing 0.05 shares of Gold-Denominated
Preferred Stock (cost $179,850) 5,000 216,500
- -------------------------------------------------------------------------------------
TOTAL SECURITIES 19,520,020
- -------------------------------------------------------------------------------------
See notes to portfolios of investments and notes to financial
statements.
60
ALL AMERICAN EQUITY FUND
- -------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -------------------------------------------------------------------------------------
PRINCIPAL
REPURCHASE AGREEMENT 3.31% AMOUNT VALUE
Joint Tri-Party Repurchase Agreement, Credit Suisse
First Boston, 12/31/03, 0.85%, due 01/02/04,
repurchase price $682,566, collateralized by U.S.
Treasury securities held in a joint tri-party
repurchase account (cost $682,534) $682,534 $ 682,534
- -------------------------------------------------------------------------------------
TOTAL INVESTMENTS 97.93% 20,202,554
- -------------------------------------------------------------------------------------
(cost $16,640,505)
Other assets and liabilities, net 2.07% 427,119
-----------
NET ASSETS 100% $20,629,673
-----------
-----------
See notes to portfolios of investments and notes to financial
statements.
61
CHINA REGION OPPORTUNITY FUND
- --------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- --------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS 87.33% SHARES VALUE
AIRLINES 0.85%
- --------------------------------------------------------------------------------------
Cathay Pacific Airways Ltd. 240,000 $ 455,965
APPAREL 2.18%
- --------------------------------------------------------------------------------------
Kingmaker Footwear Holdings Ltd. 192,000 85,938*
Li & Fung Ltd. 630,000 1,079,247
-----------
1,165,185
AUTOMOBILE 1.68%
- --------------------------------------------------------------------------------------
Brilliance China Automotive Holdings Ltd., ADR 4,400 249,480*
Denway Motors Ltd. 616,000 650,613
-----------
900,093
BANKING & FINANCIAL SERVICES 11.24%
- --------------------------------------------------------------------------------------
CITIC International Financial Holdings Ltd. 2,000,000 1,088,392
Endeavour Mining Capital Corp. 25,000 78,908*
Hong Kong Exchanges & Clearing Ltd. 290,000 627,532
HSBC Holdings plc 153,700 2,425,149
SE Global Equities Corp. 367,500 150,675*
Standard Chartered plc 14,000 227,210
The Bank of East Asia Ltd. 250,000 766,382*
Wing Hang Bank Ltd. 110,000 654,581
-----------
6,018,829
BEVERAGES 0.98%
- --------------------------------------------------------------------------------------
Tsingtao Brewery Company Ltd., H shares 450,000 527,451*
BUILDING MATERIALS 1.93%
- --------------------------------------------------------------------------------------
Anhui Conch Cement Company Ltd., H shares 800,000 1,035,582*
CHEMICALS & ALLIED PRODUCTS 5.25%
- --------------------------------------------------------------------------------------
Sinopec Beijing Yanhua Petrochemical Co., Ltd.,
H shares 2,200,000 850,105*
Sinopec Shanghai Petrochemical Co., Ltd., H shares 1,500,000 666,559
Sinopec Yizheng Chemical Fibre Co., Ltd., H shares 1,004,000 253,465
Sinopec Zhenhai Refining and Chemical Co., Ltd.,
H shares 1,200,000 1,043,310
-----------
2,813,439
COMMERCIAL SERVICES 0.10%
- --------------------------------------------------------------------------------------
China Fire Safety Enterprise Group Holdings Ltd. 800,000 54,613*
See notes to portfolios of investments and notes to financial
statements.
62
CHINA REGION OPPORTUNITY FUND
- --------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- --------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
COMPUTER & OFFICE EQUIPMENT 0.80%
- --------------------------------------------------------------------------------------
Acer, Inc., GDR, 144A 12,621 $ 94,026
Hon Hai Precision Industry Co., Ltd., Sponsored GDR 42,000 333,900*
-----------
427,926
CONGLOMERATES 3.22%
- --------------------------------------------------------------------------------------
China Merchants Holdings International Company, Ltd. 699,000 918,345
First Pacific Co., Ltd. 500,000 109,483*
Hutchison Whampoa Ltd. 28,000 205,571
Shanghai Industrial Holdings Ltd. 215,005 488,789
-----------
1,722,188
EDUCATION 2.13%
- --------------------------------------------------------------------------------------
Capital Alliance Group, Inc. 1,673,332 1,139,158*+
ELECTRONIC EQUIPMENT 8.02%
- --------------------------------------------------------------------------------------
ASM Pacific Technology Ltd. 191,000 833,991
AU Optronics Corp., Sponsored ADR 15,000 178,800*
Nam Tai Electronics, Inc. 8,000 224,640
Samsung Electronics, GDR Non-Voting Shares, 144A 3,380 339,690
Samsung Electronics, GDR Voting Shares, 144A 1,800 338,400*
Skyworth Digital Holdings Ltd. 1,300,000 324,843*
ST Assembly Test Service Ltd. 250,000 312,077*
Taiwan Semiconductor Manufacturing Co., Ltd.,
Sponsored ADR 63,380 649,011*
Techtronic Industries Company, Ltd. 198,000 548,318
United Microelectronics Corporation, Sponsored ADR 110,000 544,500*
Yageo Corp. 1 2*
-----------
4,294,272
FOOD 1.19%
- --------------------------------------------------------------------------------------
COFCO International Ltd. 994,000 640,155
HOTELS 0.48%
- --------------------------------------------------------------------------------------
The Hong Kong & Shanghai Hotels Ltd. 440,000 255,031*
INTERNET 0.35%
- --------------------------------------------------------------------------------------
Asia Broadband, Inc. 1,500,000 186,000*+
INVESTMENT TRUSTS 4.53%
- --------------------------------------------------------------------------------------
iShares MSCI Australia Index Fund 5,600 74,816
iShares MSCI Hong Kong Index Fund 55,000 550,000
iShares MSCI Japan Index Fund 33,000 318,120
iShares MSCI Malaysia Index Fund 49,000 316,050*
See notes to portfolios of investments and notes to financial
statements.
63
CHINA REGION OPPORTUNITY FUND
- --------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- --------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
INVESTMENT TRUSTS (CONT'D)
- --------------------------------------------------------------------------------------
iShares MSCI Singapore (Free) Index Fund 64,000 $ 384,000*
iShares MSCI South Korea Index Fund 15,000 375,600*
iShares MSCI Taiwan Index Fund 36,000 404,640*
-----------
2,423,226
MACHINERY 1.23%
- --------------------------------------------------------------------------------------
Chen Hsong Holdings Ltd. 352,000 276,567
China Yuchai International Ltd. 8,400 257,040*
Ocean Grand Holdings Ltd. 340,000 123,716*
-----------
657,323
NATURAL RESOURCES 13.93%
- --------------------------------------------------------------------------------------
Aluminum Corporation of China Ltd., H shares 1,650,000 1,253,904*
Apac Minerals, Inc. 250,000 133,447*
Apac Minerals, Inc. (RS) 57,500 29,158*
Apac Minerals, Inc., Warrants (March 2004) 100,000 9,283*
Apac Minerals, Inc., Warrants (March 2004) (RS) 28,750 0*
Bema Gold Corp. 100,000 372,877*
Caledon Resources Corp. plc 900,000 224,677*
China Broadband Corp. 1,117,600 894,080*
China NetTV Holdings, Inc. 350,000 161,000*
China NetTV Holdings, Inc. (RS) 500,000 207,000*
China NetTV Holdings, Inc., Warrants (September 2006)
(RS) 500,000 171,000*
Entree Gold, Inc., Units (RS) 200,000 275,558*
Freeport-McMoRan Copper & Gold, Inc., Class B 4,000 168,520
High River Gold Mines Ltd. 100,000 150,853*
Ivanhoe Energy, Inc. 10,000 37,520*
Jiangxi Copper Co., Ltd. 1,150,000 629,528
Olympus Pacific Minerals, Inc. (RS) 500,000 180,057*
Olympus Pacific Minerals, Inc., Warrants (March 2004)
(RS) 250,000 16,633*
Oriel Resources plc (RS) 167,000 44,668*
Silk Road Resources Ltd., Special Warrants (RS) 260,000 385,982*
Sino Gold Ltd. 70,000 152,818*
SKN Resources Ltd. 5,000 18,760*
Spur Ventures, Inc. 537,950 686,665*
TVI Pacific, Inc. 500,000 83,163*
TVI Pacific, Inc., Units (RS) 1,185,714 305,452*
Yanzhou Coal Mining Co., Ltd., H shares 860,000 869,554*
-----------
7,462,157
OFFICE SUPPLIES 0.00%
- --------------------------------------------------------------------------------------
China First Pencil Co., Ltd., B shares 1 0*
Daying Modern Agricultural Co. 1 0*
-----------
0
See notes to portfolios of investments and notes to financial
statements.
64
CHINA REGION OPPORTUNITY FUND
- --------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- --------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
OIL & GAS EXTRACTION 6.64%
- --------------------------------------------------------------------------------------
China Oilfield Services Ltd., H shares 1,200,000 $ 425,052*
China Petroleum & Chemical Corporation, H shares 2,500,000 1,118,982*
CNOOC Ltd., ADR 22,500 898,200
PetroChina Co., Ltd., ADR 19,500 1,112,475
-----------
3,554,709
PHARMACEUTICALS 0.21%
- --------------------------------------------------------------------------------------
Dragon Pharmaceuticals, Inc. 120,000 111,600*
PUBLISHING 0.38%
- --------------------------------------------------------------------------------------
Lingo Media, Inc. 1,056,800 201,116*+
REAL ESTATE DEVELOPERS 3.79%
- --------------------------------------------------------------------------------------
Cheung Kong Holdings Ltd. 22,886 181,290
China Overseas Land & Investment Ltd. 3,500,000 640,155
Hang Lung Group Ltd. 300,000 374,819
Henderson Land Development Co., Ltd. 96,000 424,125
Sun Hung Kai Properties Ltd. 49,852 410,952
-----------
2,031,341
RETAIL 1.58%
- --------------------------------------------------------------------------------------
Digital China Holdings Ltd. 810,000 271,261*
Esprit Holdings Ltd. 140,000 465,239
Sa Sa International Holdings Ltd. 400,000 110,771
Shanghai Friendship Group, Inc., Co., B shares 1 1
-----------
847,272
SHIPPING & CONTAINERS 3.52%
- --------------------------------------------------------------------------------------
China International Marine Containers (Group) Co.,
Ltd., B shares 365,088 698,787*
China Shipping Development Co., Ltd., H shares 1,140,000 836,967*
Cosco Pacific Ltd. 265,000 348,157
-----------
1,883,911
SOFTWARE 1.05%
- --------------------------------------------------------------------------------------
Travelsky Technology Ltd., H shares 525,000 561,262
STEEL MANUFACTURING 3.69%
- --------------------------------------------------------------------------------------
Angang New Steel Company Ltd., H shares 1,400,000 757,366*
Maanshan Iron & Steel Company Ltd., H shares 1,900,000 630,172*
POSCO, ADR 17,400 591,078
-----------
1,978,616
See notes to portfolios of investments and notes to financial
statements.
65
CHINA REGION OPPORTUNITY FUND
- --------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- --------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
TELECOMMUNICATIONS 3.46%
- --------------------------------------------------------------------------------------
China Mobile (Hong Kong) Ltd., ADR 30,000 $ 465,900
China Telecom Corp., Ltd. 1,200,000 490,742
China Unicom Ltd. 118,000 110,192
Philippine Long Distance Telephone Co., ADR 45,000 783,900*
-----------
1,850,734
THERAPEUTICS 0.13%
- --------------------------------------------------------------------------------------
Tong Ren Tang Technologies Company Ltd., H shares 40,000 70,327*
TRANSPORTATION 1.43%
- --------------------------------------------------------------------------------------
Zhejiang Expressway Co., Ltd., H shares 1,088,000 763,755
UTILITIES 1.36%
- --------------------------------------------------------------------------------------
Hong Kong & China Gas Co., Ltd. 221,693 338,375
Huaneng Power International, Inc., ADR 5,600 388,696
-----------
727,071
- --------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 46,760,307
- --------------------------------------------------------------------------------------
(cost $36,640,149)
PRINCIPAL
REPURCHASE AGREEMENT 12.01% AMOUNT
Joint Tri-Party Repurchase Agreement, Credit Suisse
First Boston, 12/31/03, 0.85%, due 01/02/04,
repurchase price $6,429,504, collateralized by
U.S. Treasury securities held in a joint
tri-party repurchase account (cost $6,429,200) $6,429,200 6,429,200
- --------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.34% 53,189,507
- --------------------------------------------------------------------------------------
(cost $43,069,349)
Other assets and liabilities, net 0.66% 353,982
-----------
NET ASSETS 100% $53,543,489
-----------
-----------
See notes to portfolios of investments and notes to financial
statements.
66
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS 85.79% SHARES VALUE
ALUMINUM 0.53%
- -----------------------------------------------------------------------------------------
Alcoa, Inc. 30,000 $ 1,140,000*
COAL 0.57%
- -----------------------------------------------------------------------------------------
Arch Coal, Inc. 20,000 623,400*
Yanzhou Coal Mining Co., Ltd., H shares 600,000 606,666
------------
1,230,066
COPPER 2.30%
- -----------------------------------------------------------------------------------------
Amerigo Resources Ltd. 640,000 990,214*
Aur Resources, Inc. 150,000 783,275*
First Quantum Minerals Ltd. 60,500 658,519*
Jiangxi Copper Co., Ltd. 2,500,000 1,368,540
Phelps Dodge Corp. 15,000 1,141,350*
------------
4,941,898
DATA PROCESSING & SOFTWARE 0.02%
- -----------------------------------------------------------------------------------------
Stockgroup Information Systems, Inc. 150,000 44,250*
DIAMOND MINING & EXPLORATION 1.35%
- -----------------------------------------------------------------------------------------
Aber Diamond Corp. 70,000 2,545,701*
Diagem International Resource Corp. 500,000 119,909*
Diagem International Resource Corp., Warrants (July
2004) 500,000 0*
Diamond Fields International Ltd. (RS) 112,000 68,362*
Diamonds North Resources Ltd. 75,000 63,242*
Diamonds North Resources Ltd., Warrants (March 2005) 75,000 16,826*
Metalex Ventures Ltd. (RS) 30,000 51,812*
Tahera Corporation 200,000 44,095*
------------
2,909,947
DIVERSIFIED CHEMICALS 3.69%
- -----------------------------------------------------------------------------------------
Dow Chemical Co. 46,300 1,924,691
E.I. du Pont de Nemours and Co. 25,300 1,161,017
FMC Corp. 50,000 1,706,500*
Georgia Gulf Corp. 50,000 1,444,000*
Imperial Chemical Industries plc, ADR 120,000 1,718,400
------------
7,954,608
DIVERSIFIED EXPLORATION & PRODUCTION 1.11%
- -----------------------------------------------------------------------------------------
BHP Billiton Ltd., ADR 70,000 1,278,200
Rio Tinto plc, Sponsored ADR 10,000 1,113,100
------------
2,391,300
See notes to portfolios of investments and notes to financial
statements.
67
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
SHARES VALUE
ELECTRICITY GENERATION 1.05%
- -----------------------------------------------------------------------------------------
Great Lakes Hydro Income Fund 80,000 $ 1,073,144
Northland Power Income Fund 130,000 1,190,732
------------
2,263,876
FERROCHROME 0.00%
- -----------------------------------------------------------------------------------------
Zimasco Consolidated Enterprises Ltd. (RS) 22,000 4,840
FINANCIAL SERVICES 0.09%
- -----------------------------------------------------------------------------------------
GMP Capital Corp. 15,000 193,556*
FOREST PRODUCTS 0.65%
- -----------------------------------------------------------------------------------------
Louisiana-Pacific Corp. 69,700 1,246,236*
West Fraser Timber Co., Ltd. 5,500 161,683
------------
1,407,919
GAS DISTRIBUTION 2.30%
- -----------------------------------------------------------------------------------------
Energy Savings Income Fund 158,000 3,440,761
Sempra Energy 50,000 1,503,000
------------
4,943,761
GOLD & COPPER MINING 6.48%
- -----------------------------------------------------------------------------------------
European Minerals Corp., Units (RS) 338,250 321,337*
Freeport-McMoRan Copper & Gold, Inc., Class B 20,000 842,600
Ivanhoe Mines Ltd. 35,000 278,884*
Northern Orion Resources, Inc. 1,997,200 4,758,733*
Northern Orion Resources, Inc., Warrants (March 2005) 250,000 34,425*
Northern Orion Resources, Inc., Warrants (May 2008) 615,200 770,993*
Northgate Exploration Ltd. 100,000 206,552*
Northgate Exploration Ltd., Warrants (December 2006) 745,000 518,702*
Taseko Mines Ltd. 380,000 632,035*
Taseko Mines Ltd., Units (RS) 250,000 652,342*
Wheaton River Minerals Ltd. 1,335,000 3,996,790*
Wheaton River Minerals Ltd., Warrants (May 2007) 340,700 607,970*
Wheaton River Minerals Ltd., Warrants (August 2008) 225,000 322,013*
------------
13,943,376
GOLD & NICKEL MINING 1.21%
- -----------------------------------------------------------------------------------------
Rio Narcea Gold Mines Ltd. 811,000 2,509,573*
Rio Narcea Gold Mines Ltd., Warrants (September 2008) 112,500 104,437*
------------
2,614,010
See notes to portfolios of investments and notes to financial
statements.
68
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
SHARES VALUE
GOLD MINING 7.99%
- -----------------------------------------------------------------------------------------
Agnico-Eagle Mines Ltd., Warrants (November 2007) 10,000 $ 28,000*
Apac Minerals, Inc. 310,000 165,474*
Apac Minerals, Inc. (RS) 86,000 43,610*
Apac Minerals, Inc., Warrants (March 2004) 100,000 9,283*
Apac Minerals, Inc., Warrants (March 2004) (RS) 43,000 0*
Apollo Gold Corp. 425,000 973,195*
Apollo Gold Corp., Warrants (March 2004) 78,125 53,906*
Ashanti Goldfields Co. Ltd., Warrants (April 2004) 40,000 401,600*
Ashanti Goldfields Co. Ltd., Warrants (October 2004) 40,000 401,600*
Ashanti Goldfields Co. Ltd., Warrants (April 2005) 40,000 401,600*
Bema Gold Corp. 540,000 2,013,552*
Bema Gold Corp., Warrants (June 2004) 117,500 256,334*
Bema Gold Corp., Warrants (October 2007) 125,000 316,211*
Bolivar Gold Corp. 810,800 1,354,835*
Bolivar Gold Corp., Warrants (March 2008) 180,000 176,846*
Bolivar Gold Corp., Warrants (August 2008) 250,000 174,061*
Caledon Resources Corp. plc 1,000,000 249,641*
China NetTV Holdings, Inc. 350,000 161,000*
China NetTV Holdings, Inc. (RS) 500,000 207,000*
China NetTV Holdings, Inc., Warrants (September 2005)
(RS) 500,000 171,000*
Corona Gold Ltd. 50,000 376*
Dumont Nickel, Inc. (RS) 500,000 216,803*
Dumont Nickel, Inc., Warrants (April 2004) (RS) 250,000 64,403*
Entree Gold, Inc., Units (RS) 160,000 220,446*
Glencairn Gold Corp. 100,000 81,228*
Glencairn Gold Corp. (RS) 300,000 231,501*
Glencairn Gold Corp., Units (RS) 500,000 406,142*
Glencairn Gold Corp., Warrants (February 2005) (RS) 150,000 44,095*
Goldcorp, Inc. 30,000 478,505
Goldcorp, Inc., Warrants (April 2007) 5,000 57,500*
Herald Resources Ltd. 100,000 57,213*
High River Gold Mines Ltd. 200,000 301,706*
IAMGOLD Corp. 16,000 111,647
Kinross Gold Corp., Warrants (December 2007) 135,000 123,235*
Metallica Resources, Inc., Units (RS) 400,000 767,416*
Nevada Pacific Gold Ltd. 7,568 6,733*
Nevada Pacific Gold Ltd. (RS) 432,432 365,476*
Nevada Pacific Gold Ltd., Warrants (April 2004) (RS) 216,216 111,232*
Nevsun Resources Ltd., Warrants (May 2005) 50,000 201,911*
New Sleeper Gold Corp. (RS) 200,000 154,721*
Olympus Pacific Minerals, Inc. (RS) 500,000 180,056*
Olympus Pacific Minerals, Inc., Warrants (March 2004)
(RS) 250,000 16,633*
Oriel Resources plc (RS) 500,000 133,736*
Placer Dome, Inc. 90,000 1,611,900
Planet Exploration, Inc. (RS) 160,000 190,492*
Planet Exploration, Inc., Warrants (December 2005) (RS) 160,000 0*
See notes to portfolios of investments and notes to financial
statements.
69
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD MINING (CONT'D)
- -----------------------------------------------------------------------------------------
Randgold Resources Ltd., ADR 40,000 $ 1,092,000*
Silk Road Resources Ltd., Special Warrants (RS) 265,000 393,405*
Sino Gold Ltd. 250,000 545,780*
St. Andrew Goldfields Ltd. 500,000 100,569*
Stingray Resources, Inc., Units (RS) 120,000 122,632*
Strongbow Resources, Inc. 100,000 48,737*
TVI Pacific, Inc. 1,000,000 166,325*
TVI Pacific, Inc., Units (RS) 2,371,428 610,904*
UGL Enterprises Ltd., Units (RS) 100,000 63,204*
U.S. Gold Corp. 200,000 164,000*
X-Cal Resources Ltd. 140,500 89,127*
X-Cal Resources Ltd., Warrants (May 2004) 200,000 40,227*
Yamana Gold, Inc. 25,000 59,954*
Yamana Gold, Inc., Warrants (July 2008) 12,500 22,725*
------------
17,213,443
INDEPENDENT POWER PRODUCERS 0.56%
- -----------------------------------------------------------------------------------------
Calpine Corp. 250,000 1,202,500*
INTEGRATED OIL & GAS 2.59%
- -----------------------------------------------------------------------------------------
Occidental Petroleum Corp. 30,000 1,267,200
PetroChina Co. Ltd., ADR 50,000 2,852,500
Sasol Ltd., Sponsored ADR 75,000 1,086,750*
YPF Sociedad Anonima, Sponsored ADR 10,000 370,200*
------------
5,576,650
IODINE 0.03%
- -----------------------------------------------------------------------------------------
Atamaca Minerals Corp. 111,000 55,816*
IRON ORE 0.49%
- -----------------------------------------------------------------------------------------
Labrador Iron Ore Royalty Trust 75,000 1,053,069
MERCHANT BANKING 0.40%
- -----------------------------------------------------------------------------------------
Endeavour Mining Capital Corp. 153,000 482,915*
Endeavour Mining Capital Corp. (RS) 120,000 378,757*
Endeavour Mining Capital Corp., Warrants (November
2008) (RS) 60,000 0*
------------
861,672
MINING EQUIPMENT & SERVICES 0.74%
- -----------------------------------------------------------------------------------------
Dynatec Corp. 600,000 816,926*
Joy Global, Inc. 30,000 784,500
------------
1,601,426
See notes to portfolios of investments and notes to financial
statements.
70
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
NICKEL 1.61%
- -----------------------------------------------------------------------------------------
Canico Resource Corp. 25,000 $ 252,388*
Inco Ltd. 40,000 1,592,800*
LionOre Mining International Ltd. 200,000 1,233,126*
WMC Resources Ltd., ADR 22,700 388,170*
------------
3,466,484
OIL & GAS DRILLING 2.34%
- -----------------------------------------------------------------------------------------
ENSCO International, Inc. 30,000 815,100
Ensign Resource Service Group, Inc. 70,000 1,115,538
Nabors Industries, Inc. 25,000 1,037,500*
Patterson-UTI Energy, Inc. 26,000 855,920*
Precision Drilling Corp. 12,000 524,160*
Rowan Companies, Inc. 30,000 695,100*
------------
5,043,318
OIL & GAS EQUIPMENT & SERVICES 6.74%
- -----------------------------------------------------------------------------------------
BJ Services Co. 20,000 718,000*
CCS Income Trust 70,000 1,651,646
China Oilfield Services Ltd. 1,500,000 531,315*
Key Energy Services, Inc. 75,000 773,250*
Lone Star Technologies, Inc. 50,000 799,000*
Maverick Tube Corp. 50,000 962,500*
National Oilwell, Inc. 40,000 894,400*
Oil Service HOLDRs Trust 40,000 2,480,000
Peak Energy Services Ltd. 210,000 576,722*
Schlumberger Ltd. 20,000 1,094,400
ShawCor Ltd. 100,000 1,206,050
Smith International, Inc. 30,000 1,245,600*
Total Energy Services Ltd. 200,000 719,452*
Weatherford International Ltd. 24,000 864,000*
------------
14,516,335
OIL & GAS EXPLORATION & PRODUCTION - JUNIOR 5.94%
- -----------------------------------------------------------------------------------------
Adobe Ventures, Inc. (RS) 1,000,000 648,513*+
Case Resources, Inc. 1,400,000 1,245,503*
Cavell Energy Corp. 300,000 473,446*
Cheniere Energy, Inc. 50,000 585,000*
China Broadband Corp. 2,259,800 1,807,840*+
Choice Resources Corp. 750,000 440,955*
Choice Resources Corp., Special Warrants (RS) 100,000 59,568*
Compton Petroleum Corp. 250,000 1,160,407*
Eastshore Energy Ltd., Class A 50,000 121,843*
Eastshore Energy Ltd., Class A (RS) 150,000 347,252*
Endev Energy, Inc. 417,900 792,059*
See notes to portfolios of investments and notes to financial
statements.
71
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
OIL & GAS EXPLORATION & PRODUCTION - JUNIOR (CONT'D)
- -----------------------------------------------------------------------------------------
Endev Energy, Inc. (RS) 100,000 $ 180,056*
Galaxy Energy Corp. 39,500 103,095*
Hawk Energy Corp., Special Warrants (RS) 100,000 209,453*
High Point Resources, Inc. 300,000 598,770*
Ivanhoe Energy, Inc. 35,000 131,319*
Kensington Energy Ltd. 606,600 666,361*
Kensington Energy Ltd. (RS) 150,000 156,539*
Ketch Resources Ltd. 160,000 1,113,991*
Luke Energy Ltd. 100,000 136,154*
Mustang Resources, Inc. 77,900 271,187*
Mustang Resources, Inc. (RS) 100,000 330,716*
Olympia Energy, Inc. 350,000 839,361*
Tempest Energy Corp., Class A 82,300 372,456*
------------
12,791,844
OIL & GAS EXPLORATION & PRODUCTION - SENIOR 10.98%
- -----------------------------------------------------------------------------------------
Burlington Resources, Inc. 50,000 2,769,000
Chesapeake Energy Corp. 200,000 2,716,000
China Petroleum & Chemical Corp., ADR 60,000 2,664,600
CNOOC Ltd., ADR 70,000 2,794,400
Devon Energy Corp. 50,000 2,863,000
EOG Resources, Inc. 70,000 3,231,900
Oao Gazprom, Sponsored ADR 40,000 1,036,000
Pioneer Natural Resources Co. 110,000 3,512,300
Progress Energy Ltd. 125,000 1,201,505
Ultra Petroleum Corp. 35,000 861,699*
------------
23,650,404
OIL & GAS PIPELINES 1.79%
- -----------------------------------------------------------------------------------------
El Paso Corp. 150,000 1,228,500
Kinder Morgan Energy Partners, L.P. 16,000 788,320
The Williams Companies, Inc. 100,000 982,000
TransCanada Corp. 40,000 862,724
------------
3,861,544
OIL & GAS ROYALTY TRUSTS 10.80%
- -----------------------------------------------------------------------------------------
Acclaim Energy Trust 300,000 2,784,977
Bonavista Energy Trust 200,000 3,247,592
Canadian Oil Sands Trust 50,000 1,767,300*
Enerplus Resources Fund 100,000 3,043,996
Bonterra Energy Income Trust 50,000 599,544
Focus Energy Trust 200,000 2,320,814
Harvest Energy Trust 120,500 1,311,596
Paramount Energy Trust 200,000 1,807,140
See notes to portfolios of investments and notes to financial
statements.
72
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
OIL & GAS ROYALTY TRUSTS (CONT'D)
- -----------------------------------------------------------------------------------------
Petrofund Energy Trust 127,000 $ 1,836,442
San Juan Basin Royalty Trust 100,000 2,169,000
Vermillion Energy Trust 200,000 2,373,419
------------
23,261,820
PLATINUM GROUP METALS 2.07%
- -----------------------------------------------------------------------------------------
African Minerals, Special Warrants (RS) 12,500 75,000*
Anooraq Resources Corp. 350,000 601,091*
Anooraq Resources Corp., Units (RS) 350,000 571,036*
Aquarius Platinum Ltd. (RS) 6,862 31,015
Impala Platinum Holdings Ltd. 3,300 286,308
Osmium Holdings S.A. (RS) 104 10,400
South Atlantic Ventures Ltd. 195,000 848,548*
South Atlantic Ventures Ltd., Warrants (December 2004) 25,000 65,273*
Southern African Resources plc 3,500,000 1,045,372
SouthernEra Resources Ltd. (RS) 200,000 829,304*
SouthernEra Resources Ltd., Warrants (November 2008)
(RS) 100,000 92,833*
------------
4,456,180
POLYMETALLIC 0.62%
- -----------------------------------------------------------------------------------------
Altius Minerals Corp. 200,000 355,858*
Altius Minerals Corp., Warrants (April 2004) 100,000 23,208*
America Mineral Fields, Inc. 100,000 96,701*
Farallon Resources Ltd. 100,000 55,700*
Farallon Resources Ltd., Warrants (April 2004) 100,000 24,755*
FNX Mining Co., Inc. 50,000 337,292*
Wolfden Resources, Inc. 100,000 438,634*
------------
1,332,148
POTASH & AGRICULTURAL FERTILIZERS 0.32%
- -----------------------------------------------------------------------------------------
Spur Ventures, Inc. 537,950 686,665*
PROPANE DISTRIBUTION 0.92%
- -----------------------------------------------------------------------------------------
Superior Plus Income Fund 100,000 1,985,070
PULP & PAPER 2.05%
- -----------------------------------------------------------------------------------------
Aracruz Celulose S.A., ADR 25,000 876,000
Georgia-Pacific Corp. 35,000 1,073,450
Sappi Ltd., Sponsored ADR 100,000 1,367,000
Tembec, Inc. 150,000 1,094,264
------------
4,410,714
See notes to portfolios of investments and notes to financial
statements.
73
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
SHIPPING & CONTAINERS 0.01%
- -----------------------------------------------------------------------------------------
Frontline Ltd. 1,000 $ 25,470
SILVER MINING 0.09%
- -----------------------------------------------------------------------------------------
Pan American Silver Corp., Warrants (February 2008) 27,000 193,834*
SOAP & CLEANING PRODUCTS 0.44%
- -----------------------------------------------------------------------------------------
KCP Income Fund 100,000 943,798
SPECIALTY CHEMICALS 2.73%
- -----------------------------------------------------------------------------------------
Acetex Corp. 220,000 1,124,976*
Eastman Chemical Co. 40,000 1,581,200
Hercules, Inc. 125,000 1,525,000*
Millennium Chemicals, Inc. 100,000 1,268,000
Sinopec Yizheng Chemical Fibre Co., Ltd., H shares 1,500,000 378,683
------------
5,877,859
STEEL 1.00%
- -----------------------------------------------------------------------------------------
Algoma Steel, Inc. 200,000 1,090,782*
United States Steel Corp. 30,000 1,050,600
------------
2,141,382
URANIUM 0.64%
- -----------------------------------------------------------------------------------------
Cameco Corp. 20,000 1,156,539
Denison Energy, Inc. 47,500 220,477*
------------
1,377,016
ZINC 0.55%
- -----------------------------------------------------------------------------------------
Breakwater Resources Ltd. 500,000 247,553*
Breakwater Resources Ltd. (RS) 500,000 235,176*
Noranda Income Fund 76,500 688,864
------------
1,171,593
- -----------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 184,741,461
- -----------------------------------------------------------------------------------------
(cost $150,384,779)
PREFERRED STOCK 0.08%
GOLD & COPPER MINING 0.08%
- -----------------------------------------------------------------------------------------
Freeport-McMoRan Copper & Gold, Inc., Depositary Shares
representing 0.05 shares of Gold-Denominated
Preferred Stock (cost $143,873) 4,000 173,200
See notes to portfolios of investments and notes to financial
statements.
74
GLOBAL RESOURCES FUND
- -----------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------------------
PURCHASED OPTION 0.01% CONTRACTS VALUE
GOLD & SILVER MINING 0.01%
- -----------------------------------------------------------------------------------------
Philadelphia Stock Exchange Gold & Silver Index, Strike
Price 75, Put, Expiration Mar. 2004 (cost $93,750) 1,250 $ 15,625
RIGHTS 0.00% SHARES
AGRICULTURAL CHEMICALS 0.00%
- -----------------------------------------------------------------------------------------
IMC Global, Inc., Rights (June 2009) 3,800 0
(cost $0)
PRINCIPAL
CONVERTIBLE DEBENTURES 0.10% AMOUNT
GOLD MINING 0.07%
- -----------------------------------------------------------------------------------------
Bolivar Gold Corp. (RS) $ 250,000 139,249
OIL & GAS EXPLORATION & PRODUCTION - JUNIOR 0.03%
- -----------------------------------------------------------------------------------------
Catalina Energy Corp. (RS) 100,000 67,690
- -----------------------------------------------------------------------------------------
TOTAL CONVERTIBLE DEBENTURES 206,939
- -----------------------------------------------------------------------------------------
(cost $255,608)
- -----------------------------------------------------------------------------------------
TOTAL SECURITIES 185,137,225
- -----------------------------------------------------------------------------------------
REPURCHASE AGREEMENT 16.79%
Joint Tri-Party Repurchase Agreement, Credit Suisse
First Boston, 12/31/03, 0.85%, due 01/02/04,
repurchase price $36,169,220, collateralized by
U.S. Treasury securities held in a joint tri-party
repurchase account (cost $36,167,512) 36,167,512 36,167,512
- -----------------------------------------------------------------------------------------
TOTAL INVESTMENTS 102.77% 221,304,737
- -----------------------------------------------------------------------------------------
(cost $187,045,522)
Other assets and liabilities, net (2.77)% (5,967,492)
------------
NET ASSETS 100% $215,337,245
------------
------------
See notes to portfolios of investments and notes to financial
statements.
75
WORLD PRECIOUS MINERALS FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS 87.12% SHARES VALUE
CHEMICALS & ALLIED PRODUCTS 0.76%
- ---------------------------------------------------------------------------------------
Acetex Corp. 430,000 $ 2,198,816*
DATA PROCESSING & SOFTWARE 0.10%
- ---------------------------------------------------------------------------------------
Stockgroup Information Systems, Inc. 1,000,000 295,000*+
DIAMOND MINING & EXPLORATION 2.20%
- ---------------------------------------------------------------------------------------
Aber Diamond Corp. 75,000 2,727,536*
Diagem International Resource Corp. 1,650,000 395,699*
Diagem International Resource Corp., Warrants (July
2004) 1,500,000 0*
Diamond Fields International Ltd. 288,000 184,922*
Diamond Fields International Ltd. (RS) 512,000 312,512*
Diamonds North Resources Ltd. 1,850,000 1,559,974*+
Diamonds North Resources Ltd., Warrants (March 2005) 300,000 67,304*
JML Resources Ltd. 73,400 11,924*
Metalex Ventures Ltd. (RS) 70,000 120,895*
SouthernEra Resources Ltd. (RS) 200,000 829,304*
SouthernEra Resources Ltd., Warrants (November 2008)
(RS) 100,000 92,833*
Superior Diamonds, Inc. 60,000 35,276*
------------
6,338,179
DIAMONDS & GOLD RETAIL 0.35%
- ---------------------------------------------------------------------------------------
Tiffany & Co. 22,500 1,017,000
FINANCIAL SERVICES 0.38%
- ---------------------------------------------------------------------------------------
GMP Capital Corp. 85,000 1,096,817*
GOLD/MINERAL EXPLORATION & DEVELOPMENT 25.45%
- ---------------------------------------------------------------------------------------
African Minerals, Special Warrants (RS) 112,500 675,000*
Amarc Resources Ltd., Units (RS) 454,545 354,100*
American Gold Capital Corp. 232,500 467,644*
AMT International Mining Corp. 1,000,000 13,151*
Anooraq Resources Corp. 2,000,000 3,434,804*+
Anooraq Resources Corp., Units (RS) 650,000 1,060,496*+
Apac Minerals, Inc. 740,000 395,003*
Apac Minerals, Inc., Warrants (March 2004) 300,000 27,850*
Atikwa Minerals Corp. 1,333,333 144,406*+
Atikwa Minerals Corp., Warrants (July 2005) 1,333,333 0*
BacTech Enviromet Corp. 100,000 77,360*
Bendigo Mining NL 2,000,000 301,120*
Bolivar Gold Corp. 4,105,000 6,859,397*+
Bolivar Gold Corp., Warrants (April 2004) 250,000 371,330*
Bolivar Gold Corp., Warrants (March 2008) 720,000 707,384*
Bolivar Gold Corp., Warrants (August 2008) 1,250,000 870,305*
See notes to portfolios of investments and notes to financial
statements.
76
WORLD PRECIOUS MINERALS FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD/MINERAL EXPLORATION & DEVELOPMENT (CONT'D)
- ---------------------------------------------------------------------------------------
Caledon Resources Corp. plc 5,700,000 $ 1,422,954*
Candente Resource Corp. 10,000 8,896*
Candente Resource Corp. (RS) 190,000 160,581*
Candente Resource Corp., Warrants (June 2005) (RS) 95,000 0*
Canyon Resources Corp. 400,000 1,516,000*
Chesapeake Gold Corp. 250,000 831,625*
Chilean Gold Ltd. (RS) 500,000 0*
Coeur d' Alene Mines Corp. 100,000 578,000*
Continental Precious Minerals, Inc. 200,000 51,058*
Corona Gold Ltd. 812,500 6,116*
Dumont Nickel, Inc. (RS) 1,500,000 650,408*
Dumont Nickel, Inc., Warrants (April 2004) (RS) 750,000 193,208*
Dynatec Corp. 480,000 653,541*
ECU Silver Mining, Inc. 900,000 187,986*
European Minerals Corp., Units (RS) 800,000 760,000*
Farallon Resources Ltd. 1,040,000 579,275*
Farallon Resources Ltd., Warrants (April 2004) 900,000 222,798*
First Point Minerals Corp. 1,000,000 263,026*
First Point Minerals Corp., Warrants (May 2004) 100,000 0*
Gabriel Resources Ltd. 350,000 1,326,732*
Gallery Gold Ltd. 900,000 203,256*
Glencairn Gold Corp. 200,000 162,457*
Glencairn Gold Corp. (RS) 1,200,000 926,005*
Glencairn Gold Corp., Units (RS) 1,200,000 974,742*
Glencairn Gold Corp., Warrants (February 2005) (RS) 600,000 176,382*
Gold Reserve, Inc. 200,000 974,742*
Gold Summit Corp. 200,000 69,624*
Gold Summit Corp., Warrants (April 2004) 100,000 0*
Great Basin Gold Ltd. 1,000,000 2,630,256*
Great Basin Gold Ltd., Warrants (January 2004) 300,000 371,330*
Herald Resources Ltd. 1,625,000 929,708*
High River Gold Mines Ltd. 1,000,000 1,508,529*
Inca Pacific Resources, Inc. 100,000 18,566*
Inca Pacific Resources, Inc. (RS) 900,000 158,744*
Inca Pacific Resources, Inc., Warrants (November
2006) (RS) 900,000 0*
International Uranium Corp. 800,000 984,025*
Ivanhoe Mines Ltd. 375,000 2,988,048*
Ivanhoe Mines Ltd. 50,000 398,000*
MAG Silver Corp. 25,000 44,869*
Metallic Ventures, Inc. 100,000 591,808*
Metallica Resources, Inc. 100,000 170,967*
Metallica Resources, Inc., Units (RS) 950,000 1,822,612*
Minefinders Corporation Ltd. 250,000 2,050,052*
Moss Lake Gold Mines Ltd. 2,250,000 417,746*+
Navigator Exploration Corp. 1,554,500 505,079*+
Nevada Pacific Gold Ltd. 239,730 213,275*+
See notes to portfolios of investments and notes to financial
statements.
77
WORLD PRECIOUS MINERALS FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD/MINERAL EXPLORATION & DEVELOPMENT (CONT'D)
- ---------------------------------------------------------------------------------------
Nevada Pacific Gold Ltd. (RS) 2,270,270 $ 1,918,748*+
Nevada Pacific Gold Ltd., Warrants (April 2004) (RS) 1,135,135 583,967*
New Bullet Group, Inc., Units (RS) 425,000 143,678*
New Sleeper Gold Corp. (RS) 300,000 232,081*
Northcott Gold, Inc., Special Warrants (RS) 4,000,000 1,250,145*
Odyssey Resources Ltd. 1,000,000 293,970*
Odyssey Resources Ltd., Warrants (April 2004) 1,000,000 100,569*
Olympus Pacific Minerals, Inc. (RS) 1,000,000 360,113*
Olympus Pacific Minerals, Inc., Warrants (March 2004)
(RS) 500,000 33,265*
Orezone Resources, Inc. 1,000,000 982,478*
Pacific North West Capital Corp. 693,966 526,118*
Pacific North West Capital Corp., Warrants (August
2004) 333,333 97,990*
Pacific Rim Mining Corp. 2,500,000 2,750,145*
Planet Exploration, Inc. (RS) 300,000 357,173*
Planet Exploration, Inc., Warrants (December 2005)
(RS) 300,000 0*
QGX Ltd. 325,000 1,508,529*
Radius Explorations Ltd. 600,000 686,961*
Red Back Mining NL 640,569 356,843*
Rio Narcea Gold Mines Ltd. 2,550,000 7,890,767*
Rio Narcea Gold Mines Ltd., Warrants (September 2008) 537,500 498,975*
Rockwell Ventures, Inc. 1,100,000 119,135*
Romarco Minerals, Inc. 2,150,000 640,351*+
Rubicon Minerals Corp. 200,000 221,251*
Rubicon Minerals Corp., Warrants (February 2005) 100,000 13,925*
SKN Resources Ltd. 8,500 31,892*
Solitario Resources Corp. 230,000 311,376*
Southern African Resources plc 8,300,000 2,479,024*
Southwestern Resources Corp. 10,000 308,668*
St. Andrew Goldfields Ltd. 2,050,000 412,331*
St. Andrew Goldfields Ltd., Warrants (December 2004) 1,000,000 0*
Stingray Resources, Inc., Units (RS) 300,000 306,580*+
Stratagold Corp. 625,000 203,071*
Stratagold Corp., Warrants (April 2004) 312,500 0*
Strongbow Resources, Inc. 500,000 243,685*
TVI Pacific, Inc. 1,000,000 166,325*
TVI Pacific, Inc., Units (RS) 2,371,428 610,904*
U.S. Gold Corp. 800,000 656,000*
Verena Minerals Corp., Units (RS) 1,000,000 157,815*
Western Exploration & Development Ltd., 144A, Special
Warrants (RS) 600,000 30,000*
X-Cal Resources Ltd. 1,500,000 951,534*
X-Cal Resources Ltd., Warrants (May 2004) 1,500,000 301,706*
Yukon, Inc., Special Warrants (RS) 200,000 200,000*
------------
73,400,464
See notes to portfolios of investments and notes to financial
statements.
78
WORLD PRECIOUS MINERALS FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
INTERMEDIATE & JUNIOR GOLD PRODUCERS 37.99%
- ---------------------------------------------------------------------------------------
Agnico-Eagle Mines Ltd., Warrants (November 2007) 235,000 $ 658,000*
Apollo Gold Corp. 3,213,500 7,358,496*+
Apollo Gold Corp., Warrants (March 2004) 703,125 485,156*
Apollo Gold Corp., Warrants (December 2006) 333,500 0*
Bema Gold Corp. 2,610,000 9,732,101*
Bema Gold Corp., Warrants (October 2007) 2,826,250 7,149,528*
Cambior, Inc. 300,000 926,005*
Compania de Minas Buenaventura S.A., ADR 58,000 1,640,240
Eldorado Gold Corp. 500,000 1,566,549*
Emperor Mines Ltd. 700,000 368,872*
Glamis Gold Ltd. 300,000 5,135,961*
Goldcorp, Inc. 200,000 3,190,036
Goldcorp, Inc., Warrants (April 2007) 40,000 460,000*
Goldcorp, Inc., Warrants (May 2009) 133,500 2,478,629*
Golden Star Resources Ltd., Warrants (July 2004) 150,000 814,606*
Hecla Mining Co. 350,000 2,901,500*
IAMGOLD Corp. 1,160,000 8,094,380
Kenor ASA 1,500,000 1,120,427*
Kinross Gold Corp., Warrants (December 2007) 2,721,000 2,483,874*
Miramar Mining Corp. 650,000 1,684,524*
Northern Orion Resources, Inc. 5,267,900 12,551,837*+
Northern Orion Resources, Inc., Warrants (March 2005) 2,000,000 275,403*
Northern Orion Resources, Inc., Warrants (May 2008) 1,964,200 2,461,613*
Northgate Exploration Ltd. 2,000,000 4,131,049*
Northgate Exploration Ltd., Warrants (December 2006) 3,119,500 1,942,124*
Queenstake Resources Ltd. 1,300,000 744,208*
Randgold Resources Ltd., ADR 132,500 3,617,250*
Resolute Mining Ltd. 1,000,000 978,640*
Resolute Mining Ltd., Warrants (June 2005) 278,333 113,146*
Sino Gold Ltd. 530,000 1,157,054*
Troy Resources NL 208,800 275,073
Wheaton River Minerals Ltd. 5,145,000 15,403,357*
Wheaton River Minerals Ltd., Warrants (May 2007) 3,299,800 5,886,388*
Wheaton River Minerals Ltd., Warrants (August 2008) 900,000 1,288,052*
Yamana Gold, Inc. 150,000 359,726*
Yamana Gold, Inc., Warrants (July 2008) 75,000 136,348*
------------
109,570,152
INVESTMENT TRUSTS 0.04%
- ---------------------------------------------------------------------------------------
Gold Bullion Ltd. 2,000 84,253*
Royal Gold, Inc. 2,000 41,860
------------
126,113
See notes to portfolios of investments and notes to financial
statements.
79
WORLD PRECIOUS MINERALS FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
MERCHANT BANKING 1.56%
- ---------------------------------------------------------------------------------------
Endeavour Mining Capital Corp. 808,000 $ 2,550,296*+
Endeavour Mining Capital Corp. (RS) 614,000 1,937,972*+
Endeavour Mining Capital Corp., Warrants (April 2004)
(RS) 307,000 0*
------------
4,488,268
METAL & MINERAL MINING 7.89%
- ---------------------------------------------------------------------------------------
AfriOre Ltd. (RS) 1,000,000 690,829*
AfriOre Ltd., Warrants (March 2005) (RS) 500,000 51,445*
Amerigo Resources Ltd. 1,235,000 1,910,803*+
Amerigo Resources Ltd., Warrants (April 2004) 500,000 696,244*
Amerigo Resources Ltd., Warrants (June 2005) 537,500 561,347*
Aquarius Platinum Ltd. 50,000 297,356
Aquarius Platinum Ltd. (RS) 60,045 271,392*
Arizona Star Resource Corp. 100,000 394,538*
Breakwater Resources Ltd. (RS) 1,000,000 470,352*
Campbell Resources, Inc. 50,000 36,359*
Corriente Resources, Inc. 440,000 1,123,274*
FNX Mining Co., Inc. 275,000 1,855,104*
Jiangxi Copper Co., Ltd. 4,000,000 2,189,663
North American Tungsten Corp., Ltd. 900,000 73,106*
Northern Dynasty Minerals Ltd. 500,000 2,224,113*
Oriel Resources plc (RS) 1,000,000 267,472*
Osmium Holdings S.A. (RS) 891 89,100*
Pan American Silver Corp., Warrants (February 2008) 263,000 1,888,090*
Perilya Ltd. 100,000 91,842*
South Atlantic Ventures Ltd. 650,000 2,828,492*+
South Atlantic Ventures Ltd., Warrants (December
2004) 75,000 195,819*
Tahera Corporation 800,000 176,382*
Taseko Mines Ltd. 2,500,000 4,158,125*
Trend Mining Co. 100,000 29,000*
UGL Enterprises Ltd., Units (RS) 200,000 126,407*+
Zimasco Consolidated Enterprises Ltd. (RS) 192,500 42,350
------------
22,739,004
OIL & GAS EXTRACTION 0.86%
- ---------------------------------------------------------------------------------------
BlackRock Ventures, Inc. 500,000 1,605,230*
Choice Resources Corp. 321,500 189,023*
Choice Resources Corp., Special Warrants (RS) 250,000 148,919*
Galaxy Energy Corp. 135,000 352,350*
Ivanhoe Energy, Inc. 50,000 187,599*
------------
2,483,121
See notes to portfolios of investments and notes to financial
statements.
80
WORLD PRECIOUS MINERALS FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
SENIOR GOLD PRODUCERS 9.54%
- ---------------------------------------------------------------------------------------
Ashanti Goldfields Co. Ltd., GDR 65,000 $ 847,600*
Ashanti Goldfields Co. Ltd., Warrants (April 2004) 146,667 1,472,537*
Ashanti Goldfields Co. Ltd., Warrants (October 2004) 146,667 1,472,537*
Ashanti Goldfields Co. Ltd., Warrants (April 2005) 146,666 1,472,527*
Freeport-McMoRan Copper & Gold, Inc., Class B 72,575 3,057,585
Newmont Mining Corp. 170,000 8,263,700
Placer Dome, Inc. 610,000 10,925,100
------------
27,511,586
- ---------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 251,264,520
- ---------------------------------------------------------------------------------------
(cost $143,573,724)
PRINCIPAL
CONVERTIBLE DEBENTURES 0.22% AMOUNT
GOLD/MINERAL EXPLORATION & DEVELOPMENT 0.22%
- ---------------------------------------------------------------------------------------
Bolivar Gold Corp. (RS) $ 750,000 417,746*
St. Andrew Goldfields Ltd. 150,000 224,345*
------------
642,091
- ---------------------------------------------------------------------------------------
TOTAL CONVERTIBLE DEBENTURES 642,091
- ---------------------------------------------------------------------------------------
(cost $670,587)
PREFERRED STOCK 0.40% SHARES
SENIOR GOLD PRODUCER 0.40%
- ---------------------------------------------------------------------------------------
Freeport-McMoRan Copper & Gold, Inc., Depositary
Shares representing 0.05 shares of Gold-Denominated
Preferred Stock (cost $953,085) 26,500 1,147,450
PURCHASED OPTIONS 0.58% CONTRACTS
SENIOR GOLD PRODUCERS 0.58%
- ---------------------------------------------------------------------------------------
Barrick Gold Corp., Strike Price 25, Call, Expiration
Jan. 2005 (premium $339,593) 2,600 572,000*
Philadelphia Stock Exchange Gold & Silver Index,
Strike Price 75, Put, Expiration Mar. 2004 (premium
$298,000) 4,000 50,000*
See notes to portfolios of investments and notes to financial
statements.
81
WORLD PRECIOUS MINERALS FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
PURCHASED OPTIONS CONTRACTS VALUE
SENIOR GOLD PRODUCERS (CONT'D)
- ---------------------------------------------------------------------------------------
Placer Dome, Inc., Strike Price 15, Call, Expiration
Jan. 2005 (premium $332,403) 2,600 $ 1,066,000*
------------
1,688,000
- ---------------------------------------------------------------------------------------
TOTAL PURCHASED OPTIONS 1,688,000
- ---------------------------------------------------------------------------------------
(cost $969,996)
- ---------------------------------------------------------------------------------------
TOTAL SECURITIES 254,742,061
- ---------------------------------------------------------------------------------------
PRINCIPAL
REPURCHASE AGREEMENT 10.57% AMOUNT
Joint Tri-Party Repurchase Agreement, Credit Suisse
First Boston, 12/31/03, 0.85%, due 01/02/04,
repurchase price $30,480,527, collateralized
by U.S. Treasury securities held in a
joint tri-party repurchase
account (cost $30,479,088) $30,479,088 30,479,088
- ---------------------------------------------------------------------------------------
TOTAL INVESTMENTS 98.89% 285,221,149
- ---------------------------------------------------------------------------------------
(cost $176,646,480)
Other assets and liabilities, net 1.11% 3,199,637
------------
NET ASSETS 100% $288,420,786
------------
------------
See notes to portfolios of investments and notes to financial
statements.
82
GOLD SHARES FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS 80.27% SHARES VALUE
DIAMOND MINING & EXPLORATION 1.05%
- ---------------------------------------------------------------------------------------
Aber Diamond Corp. 22,000 $ 800,077*
Diamond Fields International Ltd. (RS) 176,000 107,426*
-----------
907,503
DIAMONDS & GOLD RETAIL 0.39%
- ---------------------------------------------------------------------------------------
Tiffany & Co. 7,500 339,000
FINANCIAL SERVICES 0.15%
- ---------------------------------------------------------------------------------------
GMP Capital Corp. 10,000 129,037*
GOLD MINING 73.53%
- ---------------------------------------------------------------------------------------
Agnico-Eagle Mines Ltd., Warrants (November 2007) 100,000 280,000*
Apollo Gold Corp. 1,450,000 3,320,311*+
Apollo Gold Corp., Warrants (March 2004) 312,500 215,625*
Apollo Gold Corp., Warrants (December 2006) 166,500 0*
Ashanti Goldfields Co. Ltd., GDR 35,000 456,400*
Ashanti Goldfields Co. Ltd., Warrants (April 2004) 146,668 1,472,547*
Ashanti Goldfields Co. Ltd., Warrants (October 2004) 146,666 1,472,527*
Ashanti Goldfields Co. Ltd., Warrants (April 2005) 146,666 1,472,527*
Bema Gold Corp. 1,000,000 3,728,774*
Bema Gold Corp., Warrants (October 2007) 1,501,950 3,799,463*
Cambior, Inc. 150,000 463,002*
Cambior, Inc., Warrants (August 2008) 75,000 101,536*
Compania de Minas Buenaventura S.A., ADR 18,400 520,352
Freeport-McMoRan Copper & Gold, Inc., Class B 30,875 1,300,764
Glamis Gold Ltd. 100,000 1,711,988*
Glencairn Gold Corp. 100,000 81,228*
Glencairn Gold Corp. (RS) 500,000 385,835*
Glencairn Gold Corp., Units (RS) 300,000 243,685*
Glencairn Gold Corp., Warrants (February 2005) (RS) 250,000 73,492*
Gold Fields Ltd., ADR 130,000 1,812,200
Goldcorp, Inc. 130,000 2,073,523
Goldcorp, Inc., Warrants (April 2007) 21,000 241,500*
Goldcorp, Inc., Warrants (May 2009) 83,500 1,550,304*
Harmony Gold Mining Co. Ltd., ADR 100,000 1,623,000
Hecla Mining Co. 100,000 829,000
IAMGOLD Corp. 380,000 2,651,610
Ivanhoe Mines Ltd. 180,000 1,434,263*
Kenor ASA 750,000 560,214*
Kinross Gold Corp., Warrants (December 2007) 1,413,000 1,289,862*
Newmont Mining Corp. 60,000 2,916,600
Northern Orion Resources, Inc. 1,190,000 2,835,416*
Northern Orion Resources, Inc., Warrants (May 2008) 720,000 902,332*
Northgate Exploration Ltd. 1,000,000 2,065,524*
See notes to portfolios of investments and notes to financial
statements.
83
GOLD SHARES FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD MINING (CONT'D)
- ---------------------------------------------------------------------------------------
Northgate Exploration Ltd., Warrants (December 2006) 1,039,000 $ 643,427*
Pacific Rim Mining Corp. 400,000 440,025*
Placer Dome, Inc. 200,000 3,581,978
Queenstake Resources Ltd. 600,000 343,480*
Randgold Resources Ltd., ADR 62,500 1,706,250*
Rio Narcea Gold Mines Ltd. 825,000 2,552,895*
Rio Narcea Gold Mines Ltd., Warrants (September 2008) 150,000 139,249*
Sino Gold Ltd. 150,000 327,468*
Wheaton River Minerals Ltd. 1,600,000 4,790,160*
Wheaton River Minerals Ltd., Warrants (May 2007) 1,947,000 3,360,886*
Wheaton River Minerals Ltd., Warrants (August 2008) 700,000 1,250,919*
Yamana Gold, Inc. 75,000 179,863*
Yamana Gold, Inc., Warrants (July 2008) 37,500 68,174*
-----------
63,270,178
INVESTMENT TRUST 0.05%
- ---------------------------------------------------------------------------------------
Gold Bullion Ltd. 1,000 42,127*
MERCHANT BANKING 2.09%
- ---------------------------------------------------------------------------------------
Endeavour Mining Capital Corp. 324,000 1,022,644*
Endeavour Mining Capital Corp. (RS) 245,000 773,295*
Endeavour Mining Capital Corp., Warrants (April 2004)
(RS) 122,500 0*
-----------
1,795,939
METAL & MINERAL MINING 3.01%
- ---------------------------------------------------------------------------------------
Impala Platinum Holdings Ltd. 7,500 650,701
Inco Ltd. 12,500 497,750*
Pan American Silver Corp., Warrants (February 2008) 122,000 875,844*
South Atlantic Ventures Ltd. 100,000 435,153*
South Atlantic Ventures Ltd., Warrants (December 2004) 50,000 130,546*
-----------
2,589,994
- ---------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 69,073,778
- ---------------------------------------------------------------------------------------
(cost $35,147,410)
PREFERRED STOCK 0.63%
GOLD MINING 0.63%
- ---------------------------------------------------------------------------------------
Freeport-McMoRan Copper & Gold, Inc., Depositary
Shares representing 0.05 shares of Gold-Denominated
Preferred Stock (cost $449,618) 12,500 541,250
See notes to portfolios of investments and notes to financial
statements.
84
GOLD SHARES FUND
- ---------------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2003
- ---------------------------------------------------------------------------------------
PURCHASED OPTIONS 1.04% CONTRACTS VALUE
GOLD MINING 1.04%
- ---------------------------------------------------------------------------------------
Barrick Gold Corp., Strike Price 25, Call, Expiration
Jan. 2005 (premium $182,857) 1,400 $ 308,000
Philadelphia Stock Exchange Gold & Silver Index,
Strike Price 75, Put, Expiration Mar. 2004 (premium
$178,987) 1,250 15,625
Placer Dome, Inc., Strike Price 15, Call, Expiration
Jan. 2005 (premium $93,750) 1,400 574,000
-----------
897,625
- ---------------------------------------------------------------------------------------
TOTAL PURCHASED OPTIONS 897,625
- ---------------------------------------------------------------------------------------
(cost $455,594)
- ---------------------------------------------------------------------------------------
TOTAL SECURITIES 70,512,653
- ---------------------------------------------------------------------------------------
PRINCIPAL
REPURCHASE AGREEMENT 16.33% AMOUNT
Joint Tri-Party Repurchase Agreement, Credit Suisse
First Boston, 12/31/03 0.85%, due 01/02/04, repurchase
price $14,049,869, collateralized by U.S. Treasury
securities held in a joint tri-party repurchase
account (cost $14,049,206) $14,049,206 14,049,206
- ---------------------------------------------------------------------------------------
TOTAL INVESTMENTS 98.27% 84,561,859
- ---------------------------------------------------------------------------------------
(cost $50,101,828)
Other assets and liabilities, net 1.73% 1,485,484
-----------
NET ASSETS 100% $86,047,343
-----------
-----------
See notes to portfolios of investments and notes to financial
statements.
85
- -----------------------------------------------------------------------------
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------
LEGEND
* Non-income producing security GO General Obligation Bond
+ Affiliated company (see following) RS Restricted Security (see following)
ADR American Depositary Receipt SPDR Standard & Poor's Depositary Receipt
GDR Global Depositary Receipt ZCB Zero Coupon Bond
GENERAL
The yields reflect the effective yield from the date of purchase.
Variable Rate Notes have periodic reset features, which effectively
shorten the maturity dates and reset the interest rates as tied to
various interest-bearing instruments. Rates shown are current rates
at December 31, 2003.
Securities with a 144A designation are exempt from registration
under Rule 144A of the Securities Act of 1933.
JOINT TRI-PARTY REPURCHASE AGREEMENTS (SEE ALSO NOTE 1 TO
FINANCIAL STATEMENTS)
The terms of the joint tri-party repurchase agreements and the
securities held as collateral at December 31, 2003 were:
Credit Suisse First Boston repurchase agreement, 12/31/03, 0.85%, due 01/02/04:
Total principal amount: $125,194,204; Total repurchase price: $125,200,116
Collateral:
$60,935,000 U.S. Treasury Note, 5.875%, 11/15/04
$44,948,000 U.S. Treasury Bond, 3.625%, 04/15/28
(total collateral market value, including accrued interest, of
$127,698,360)
UBS Financial Services, Inc. repurchase agreement, 12/31/03, 0.84%, due
01/02/04:
Total principal amount: $21,000,000; Total repurchase price: $21,000,980
Collateral:
$15,625,000 U.S. Treasury Bonds, interest rate range 5.25% - 14.00%,
maturity date range 11/15/04 - 02/15/31
$1,827,000 U.S. Treasury Notes, interest rate range 4.625% - 7.25%,
maturity date range 02/15/04 - 08/15/11
(total collateral market value, including accrued interest,
of $21,425,354)
Other mutual funds managed by U.S. Global Investors, Inc.
participate in the tri-party joint repurchase agreements. Each owns
an undivided interest in the accounts.
86
- -----------------------------------------------------------------------------
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------
AFFILIATED COMPANIES - INDICATED IN PORTFOLIO OF INVESTMENTS AS "+"
The Investment Company Act of 1940 defines affiliates as companies
in which the Fund owns at least 5% of the outstanding voting
securities. The following is a summary of transactions with each
affiliated company during the six-month period ended December 31,
2003.
SHARES OF AFFILIATED COMPANIES
JUNE 30, 2003 ADDITIONS REDUCTIONS DECEMBER 31, 2003
CHINA REGION OPPORTUNITY FUND
- ------------------------------------------------------------------------------------------------
Asia Broadband, Inc. 1,500,000 -- -- 1,500,000(a)
Capital Alliance Group Inc. 1,200,000 873,332 (400,000) 1,673,332
Lingo Media, Inc. 1,056,800 -- -- 1,056,800
At December 31, 2003, the value of investments in affiliated
companies was $1,340,274, representing 2.50% of net assets, and the
total cost was $802,511. Net realized gains on transactions were
$149,499, and there was no income earned for the period.
SHARES OF AFFILIATED COMPANIES
JUNE 30, 2003 ADDITIONS REDUCTIONS DECEMBER 31, 2003
GLOBAL RESOURCES FUND
- ----------------------------------------------------------------------------------------------
Adobe Ventures, Inc. -- 1,000,000 -- 1,000,000
China Broadband Corp. -- 2,259,800 -- 2,259,800
At December 31, 2003, the value of investments in affiliated
companies was $2,456,353, representing 1.14% of net assets, and the
total cost was $1,067,012. There was no net realized gains/losses on
transactions and there was no income earned for the period.
SHARES OF AFFILIATED COMPANIES
JUNE 30, 2003 ADDITIONS REDUCTIONS DECEMBER 31, 2003
WORLD PRECIOUS MINERALS FUND
- -------------------------------------------------------------------------------------------------
Amerigo Resources Ltd. 1,225,000 60,000 (50,000) 1,235,000(a)
Anooraq Resources Corp. 1,750,000 1,450,000 (550,000) 2,650,000
Apollo Gold Corp. 4,050,400 138,500 (975,400) 3,213,500(a)
Atikwa Minerals Corp. -- 1,333,333 -- 1,333,333(b)
Bolivar Gold Corp. 1,695,000 2,909,400 (499,400) 4,105,000(a)
Diamonds North Resources Ltd. 1,300,000 550,000 -- 1,850,000
Endeavour Mining Capital Corp. 662,000 1,309,000 (549,000) 1,422,000
First Step Ventures Corp. 1,333,333 -- (1,333,333) --(a)(b)
Moss Lake Gold Mines Ltd. 2,250,000 -- -- 2,250,000
Navigator Exploration Corp. 1,554,500 -- -- 1,554,500(a)
Nevada Pacific Gold Ltd. -- 2,510,000 -- 2,510,000
Northern Orion Resources, Inc. 2,460,000 3,007,900 (200,000) 5,267,900(a)
Romarco Minerals, Inc. 2,173,500 -- (23,500) 2,150,000
South Atlantic Ventures Ltd. 300,000 398,900 (48,900) 650,000
Stingray Resources, Inc. -- 300,000 -- 300,000
Stockgroup Information Systems,
Inc. 2,000,000 -- (1,000,000) 1,000,000(a)
UGL Enterprises Ltd. -- 200,000 -- 200,000
At December 31, 2003, the value of investments in affiliated
companies was $17,139,547, representing 5.94% of net assets, and the
total cost was $9,696,049. Net realized gains on transactions were
$2,538,795 and there was no income earned for the period.
87
- -----------------------------------------------------------------------------
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------
SHARES OF AFFILIATED COMPANIES
JUNE 30, 2003 ADDITIONS REDUCTIONS DECEMBER 31, 2003
GOLD SHARES FUND
- -------------------------------------------------------------------------------------------------
Apollo Gold Corp. 2,064,500 17,500 (632,000) 1,450,000(a)
At December 31, 2003, there were no investments in affiliated
companies. Net realized gains on transactions were $743,645, and
there was no income earned for the period.
<FN>
(a) At December 31, 2003, the company is no longer defined as an
affiliate, although it was an affiliated company during the
period.
(b) During the period, shares of First Step Ventures Corp. were
converted to shares of Atikwa Minerals Corp.
</FN>
RESTRICTED SECURITIES - INDICATED IN PORTFOLIO OF INVESTMENTS AS
"RS"
The following securities are subject to legal restrictions on their
resale. The issuer bears the cost of registration, if any, involved
in the disposition of these securities. Many of the securities
listed below were acquired in non-U.S. private placements with a
regulatory four-month hold period from closing date.
ACQUISITION COST PER
SECURITY DATE SHARE
CHINA REGION OPPORTUNITY FUND
- -------------------------------------------------------------
COMMON STOCKS AND WARRANTS
Apac Minerals, Inc. 10/31/03 $1.14
Apac Minerals, Inc., Warrants
(March 2004) 10/31/03 $0.00
China NetTV Holdings, Inc. 10/06/03 $0.04
China NetTV Holdings, Inc.,
Warrants (September 2006) 10/06/03 $0.02
Entree Gold, Inc., Units 10/16/03 $0.76
Olympus Pacific Minerals 09/18/03 $0.22
Olympus Pacific Minerals,
Warrants (March 2004) 09/18/03 $0.00
Oriel Resources plc 12/16/03 $0.26
Silk Road Resources Ltd.,
Special Warrants 12/15/03 $0.76
TVI Pacific, Inc., Units 10/24/03 $0.05
At December 31, 2003, the total cost of restricted securities was
$662,815, and the total value was $1,615,508, representing 3.02% of
net assets.
GLOBAL RESOURCES FUND
- ------------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
Adobe Ventures, Inc. 12/05/03 $0.40
African Minerals, Special Warrants 07/09/03 $6.00
Anooraq Resources Corp., Units 12/22/03 $1.58
Apac Minerals, Inc. 10/31/03 $1.14
Apac Minerals, Inc., Warrants (March 2004) 10/31/03 $0.00
Aquarius Platinum Ltd. 03/05/03 $5.68
Breakwater Resources Ltd. 09/23/03 $0.26
China NetTV Holdings, Inc. 10/06/03 $0.04
China NetTV Holdings, Inc., Warrants (September 2005) 10/06/03 $0.02
Choice Resources Corp., Special Warrants 12/20/02 $0.32
Diamond Fields International Ltd. 11/04/03 $0.45
88
- -----------------------------------------------------------------------------
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------
ACQUISITION COST PER
SECURITY DATE SHARE
GLOBAL RESOURCES FUND (CONT'D)
- ------------------------------------------------------------------------------------------
Dumont Nickle, Inc. 09/29/03 $0.12
Dumont Nickle, Inc., Warrants (April 2004) 09/29/03 $0.00
Eastshore Energy Ltd., Class A 11/17/03 $1.71
Endeavour Mining Capital Corp. 10/27/03 $2.63
Endeavour Mining Capital Corp., Warrants (November 2008) 10/27/03 $0.00
Endev Energy, Inc. 08/27/03 $1.28
Entree Gold, Inc., Units 10/16/03 $0.76
European Minerals Corp., Units 12/24/03 $0.80
Glencairn Gold Corp. 09/09/03 $0.29
Glencairn Gold Corp., Units 11/18/03 $0.65
Glencairn Gold Corp., Warrants (February 2005) 09/09/03 $0.09
Hawk Energy Corp., Special Warrants 10/16/03 $1.52
Kensington Energy Ltd. 11/06/03 $0.94
Metalex Ventures Ltd. 11/25/03 $2.36
Metallica Resources, Inc., Units 12/01/03 $1.69
Mustang Resources, Inc. 12/05/03 $3.37
Nevada Pacific Gold Ltd. 08/28/03 $0.25
Nevada Pacific Gold Ltd., Warrants (April 2004) 08/28/03 $0.03
New Sleeper Gold Corp. 12/29/03 $0.76
Olympus Pacific Minerals, Inc. 09/18/03 $0.22
Olympus Pacific Minerals, Inc., Warrants (March 2004) 09/18/03 $0.00
Oriel Resources plc 12/16/03 $0.26
Osmium Holdings S.A. 10/22/96-01/29/98 $987.07
Planet Exploration, Inc. 12/09/03 $1.07
Planet Exploration, Inc., Warrants (December 2005) 12/09/03 $0.00
Silk Road Resources Ltd., Special Warrants 12/15/03 $0.76
SouthernEra Resources Ltd. 10/29/03 $4.89
SouthernEra Resources Ltd., Warrants (November 2008) 10/29/03 $0.00
Stingray Resources, Inc., Units 12/15/03 $0.76
Taseko Mines Ltd., Units 12/05/03 $0.46
TVI Pacific, Inc., Units 10/24/03 $0.05
UGL Enterprises Ltd., Units 12/09/03 $0.46
Zimasco Consolidated Enterprises Ltd. 06/15/95-09/30/99 $3.73
CONVERTIBLE DEBENTURES
Bolivar Gold Corp. 11/21/03 $0.77
Catalina Energy Corp. 12/06/02 $0.64
At December 31, 2003, the total cost of restricted securities was
$5,912,863, and the total value was $10,176,157, representing 4.73%
of net assets.
WORLD PRECIOUS MINERALS FUND
- ------------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
African Minerals, Special Warrants 07/09/03 $6.00
AfriOre Ltd. 09/11/03 $0.46
AfriOre Ltd., Warrants (March 2005) 09/11/03 $0.03
Amarc Resources Ltd., Units 12/19/03 $0.41
Anooraq Resources Corp., Units 12/22/03 $1.58
89
- -----------------------------------------------------------------------------
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------
ACQUISITION COST PER
SECURITY DATE SHARE
WORLD PRECIOUS MINERALS FUND (CONT'D)
- -----------------------------------------------------------------------------------------
Aquarius Platinum Ltd. 03/05/03 $5.68
Breakwater Resources Ltd. 09/23/03 $0.26
Candente Resources Corp. 12/05/03 $0.80
Candente Resources Corp., Warrants (June 2005) 12/05/03 $0.00
Chilean Gold Ltd. 01/17/97 $1.10
Choice Resources Corp., Special Warrants 12/20/02 $0.32
Diamond Fields International Ltd. 11/04/03 $0.45
Dumont Nickle, Inc. 09/29/03 $0.12
Dumont Nickle, Inc., Warrants (April 2004) 09/29/03 $0.00
Endeavour Mining Capital Corp. 10/27/03 $2.63
Endeavour Mining Capital Corp., Warrants (April 2004) 10/27/03 $0.00
European Minerals Corp., Units 12/24/03 $0.80
Glencairn Gold Corp. 09/09/03 $0.29
Glencairn Gold Corp., Units 11/18/03 $0.65
Glencairn Gold Corp., Warrants (February 2005) 09/09/03 $0.09
Inca Pacific Resources, Inc. 11/18/03 $0.15
Inca Pacific Resources, Inc., Warrants (November
2006) 11/18/03 $0.00
Metalex Ventures Ltd. 11/25/03 $2.36
Metallica Resources, Inc., Units 12/01/03 $1.69
Nevada Pacific Gold Ltd. 08/28/03 $0.25
Nevada Pacific Gold Ltd., Warrants (April 2004) 08/28/03 $0.03
New Bullet Group, Inc., Units 12/17/03 $0.27
New Sleeper Gold Corp. 12/29/03 $0.76
Northcott Gold, Inc., Special Warrants 10/09/03 $0.07
Olympus Pacific Minerals, Inc. 09/18/03 $0.22
Olympus Pacific Minerals, Inc., Warrants (March 2004) 09/18/03 $0.00
Oriel Resources plc 12/16/03 $0.26
Osmium Holdings S.A. 10/22/96-01/29/98 $1,280.75
Planet Exploration, Inc. 12/09/03 $1.07
Planet Exploration, Inc., Warrants (December 2005) 12/09/03 $0.00
SouthernEra Resources Ltd. 10/29/03 $4.89
SouthernEra Resources Ltd., Warrants (November 2008) 10/29/03 $0.00
Stingray Resources, Inc., Units 12/15/03 $0.76
TVI Pacific, Inc., Units 10/24/03 $0.05
UGL Enterprises Ltd., Units 12/09/03 $0.46
Verena Minerals Corp., Units 10/30/03 $0.11
Western Exploration & Development Ltd., 144A,
Special Warrants 08/14/97 $0.50
Yukon, Inc., Special Warrants 10/27/03 $1.00
Zimasco Consolidated Enterprises Ltd. 06/15/95-09/30/99 $3.73
CONVERTIBLE DEBENTURE
Bolivar Gold Corp. 11/21/03 $0.77
At December 31, 2003, the total cost of restricted securities was
$16,015,352, and the total value was $19,966,275, representing 6.92%
of net assets.
90
- -----------------------------------------------------------------------------
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2003
- -----------------------------------------------------------------------------
ACQUISITION COST PER
SECURITY DATE SHARE
GOLD SHARES FUND
- ------------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
Diamond Fields International Ltd. 11/04/03 $0.45
Endeavour Mining Capital Corp. 10/27/03 $2.63
Endeavour Mining Capital Corp., Warrants (April 2004) 10/27/03 $0.00
Glencairn Gold Corp. 09/09/03 $0.29
Glencairn Gold Corp., Units 11/18/03 $0.65
Glencairn Gold Corp., Warrants (February 2005) 09/09/03 $0.09
At December 31, 2003, the total cost of restricted securities was
$1,084,760, and the total value was $1,583,733, representing 1.84%
of net assets.
91
- -----------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)
- -----------------------------------------------------------------------------
U.S. TREASURY
SECURITIES
CASH FUND
Investments, at identified cost $121,104,254
============
ASSETS
- ---------------------------------------------------------------------------
Investments, at value:
Securities $ 70,371,648
Repurchase agreements 50,732,606
Cash --
Receivables:
Investments sold 45,427,228
Interest 417,906
Capital shares sold 5,976,061
From adviser --
Other assets 50,608
- ---------------------------------------------------------------------------
TOTAL ASSETS 172,976,057
- ---------------------------------------------------------------------------
LIABILITIES
- ---------------------------------------------------------------------------
Payables:
Investments purchased 50,732,606
Capital shares redeemed 814,422
Adviser and affiliates 71,726
Dividends and distributions 10,118
Accounts payable and accrued expenses 66,278
Due to custodian --
- ---------------------------------------------------------------------------
TOTAL LIABILITIES 51,695,150
- ---------------------------------------------------------------------------
NET ASSETS $121,280,907
============
NET ASSETS CONSIST OF:
- ---------------------------------------------------------------------------
Paid-in capital $121,304,499
Accumulated undistributed net investment income (loss) (5,120)
Accumulated net realized loss on investments (18,472)
Net unrealized appreciation of investments --
------------
Net assets applicable to capital shares outstanding $121,280,907
============
Capital shares outstanding, an unlimited number of no
par shares authorized 121,354,047
============
NET ASSET VALUE, PUBLIC OFFERING PRICE, REDEMPTION PRICE,
PER SHARE $ 1.00
============
See accompanying notes to financial statements.
92
- -----------------------------------------------------------------------------
December 31, 2003
- -----------------------------------------------------------------------------
U.S. GOVERNMENT
SECURITIES NEAR-TERM TAX FREE
SAVINGS FUND TAX FREE FUND FUND
Investments, at identified cost $476,949,478 $19,019,664 $41,642,693
============ =========== ===========
ASSETS
- -------------------------------------------------------------------------------------------------
Investments, at value:
Securities $476,949,478 $18,834,829 $42,843,086
Repurchase agreements -- 687,492 266,123
Cash -- -- 451,711
Receivables:
Investments sold 69,685,000 678,511 279,421
Interest 1,292,162 259,269 536,265
Capital shares sold 723,169 19,244 2,131
From adviser -- 3,550 --
Other assets 20,911 897 1,570
- -------------------------------------------------------------------------------------------------
TOTAL ASSETS 548,670,720 20,483,792 44,380,307
- -------------------------------------------------------------------------------------------------
LIABILITIES
- -------------------------------------------------------------------------------------------------
Payables:
Investments purchased 68,681,845 687,492 717,834
Capital shares redeemed 1,726,086 10,263 15,429
Adviser and affiliates 146,523 -- 16,736
Dividends and distributions 276,919 49,835 135,792
Accounts payable and accrued expenses 97,301 29,876 32,943
Due to custodian 1,268 -- --
- -------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 70,929,942 777,466 918,734
- -------------------------------------------------------------------------------------------------
NET ASSETS $477,740,778 $19,706,326 $43,461,573
============ =========== ===========
NET ASSETS CONSIST OF:
- -------------------------------------------------------------------------------------------------
Paid-in capital $478,436,335 $19,324,721 $42,384,928
Accumulated undistributed net investment
income (loss) 404,082 11,734 24,749
Accumulated net realized loss on investments (1,099,639) (132,786) (414,620)
Net unrealized appreciation of investments -- 502,657 1,466,516
------------ ----------- -----------
Net assets applicable to capital shares
outstanding $477,740,778 $19,706,326 $43,461,573
============ =========== ===========
Capital shares outstanding, an
unlimited number of no par shares
authorized 477,987,428 1,779,793 3,481,561
============ =========== ===========
NET ASSET VALUE, PUBLIC OFFERING PRICE
REDEMPTION PRICE, PER SHARE $ 1.00 $ 11.07 $ 12.48
============ =========== ===========
93
- ---------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)
- ---------------------------------------------------------------------------
ALL AMERICAN CHINA REGION
EQUITY FUND OPPORTUNITY FUND
Investments, at identified cost $16,640,505 $43,069,349
=========== ===========
ASSETS
- ----------------------------------------------------------------------------------
Investments, at value:
Securities of unaffiliated issuers $19,520,020 $45,420,033
Securities of affiliated issuers -- 1,340,274
Repurchase agreements 682,534 6,429,200
Cash 15,150 --
Foreign currencies (cost $0, $13,566,
$418,200 $0, $282,859) -- 12,049
Receivables:
Investments sold 1,530,803 6,110,015
Dividends 21,582 70,324
Interest 32 1,391
Capital shares sold 8,467 1,053,485
Unrealized appreciation on foreign
currency exchange contracts - Note
1 G -- --
Other assets 593 368
- ----------------------------------------------------------------------------------
TOTAL ASSETS 21,779,181 60,437,139
- ----------------------------------------------------------------------------------
LIABILITIES
- ----------------------------------------------------------------------------------
Payables:
Investments purchased 1,072,287 6,664,221
Capital shares redeemed 20,338 17,221
Adviser and affiliates 14,754 58,301
Accounts payable and accrued expenses 42,129 22,417
Due to custodian -- 131,490
Unrealized depreciation on foreign
currency exchange contracts - Note
1 G -- --
- ----------------------------------------------------------------------------------
TOTAL LIABILITIES 1,149,508 6,893,650
- ----------------------------------------------------------------------------------
NET ASSETS $20,629,673 $53,543,489
=========== ===========
NET ASSETS CONSIST OF:
- ----------------------------------------------------------------------------------
Paid-in capital $20,292,782 $59,416,291
Accumulated net investment loss (43,546) (473,077)
Accumulated net realized loss on
investments and foreign currencies (3,181,625) (15,515,471)
Net unrealized appreciation of investments
and other assets and liabilities
denominated in foreign currencies 3,562,062 10,115,746
----------- -----------
Net assets applicable to capital shares
outstanding $20,629,673 $53,543,489
=========== ===========
Capital shares outstanding, an
unlimited number of no par shares
authorized 905,837 8,158,276
=========== ===========
NET ASSET VALUE, PUBLIC OFFERING PRICE,
REDEMPTION PRICE, PER SHARE $ 22.77 $ 6.56
=========== ===========
See accompanying notes to financial statements.
94
- ---------------------------------------------------------------------------
December 31, 2003
- ---------------------------------------------------------------------------
GLOBAL RESOURCES WORLD PRECIOUS GOLD SHARES
FUND MINERALS FUND FUND
Investments, at identified cost $187,045,522 $176,646,480 $ 50,101,828
============ ============ ============
ASSETS
- -------------------------------------------------------------------------------------------------------
Investments, at value:
Securities of unaffiliated issuers $182,680,872 $237,602,314 $ 70,512,653
Securities of affiliated issuers 2,456,353 17,139,747 --
Repurchase agreements 36,167,512 30,479,088 14,049,206
Cash 637,233 489,235 --
Foreign currencies (cost $0, $13,566,
$418,200, $0, $282,859) 421,500 -- 286,762
Receivables:
Investments sold 28,154,352 35,952,991 16,577,784
Dividends 329,287 47,998 15,345
Interest 2,611 10,014 663
Capital shares sold 12,572,711 5,863,400 1,194,663
Unrealized appreciation on foreign
currency exchange contracts - Note 1 G 18,705 5,893 --
Other assets 432 3,258 1,737
- -------------------------------------------------------------------------------------------------------
TOTAL ASSETS 263,441,568 327,593,938 102,638,813
- -------------------------------------------------------------------------------------------------------
LIABILITIES
- -------------------------------------------------------------------------------------------------------
Payables:
Investments purchased 47,758,834 34,097,921 14,964,998
Capital shares redeemed 158,999 4,739,680 1,352,320
Adviser and affiliates 164,143 271,506 61,316
Accounts payable and accrued expenses 21,926 29,197 67,274
Due to custodian -- 33,918 144,321
Unrealized depreciation on foreign
currency exchange contracts - Note 1 G 421 930 1,241
- -------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 48,104,323 39,173,152 16,591,470
- -------------------------------------------------------------------------------------------------------
NET ASSETS $215,337,245 $288,420,786 $ 86,047,343
============ ============ ============
NET ASSETS CONSIST OF:
- -------------------------------------------------------------------------------------------------------
Paid-in capital $192,730,867 $247,618,526 $181,244,578
Accumulated net investment loss (3,100,701) (32,515,326) (715,581)
Accumulated net realized loss on investments
and foreign currencies (8,510,636) (35,259,956) (128,974,137)
Net unrealized appreciation of investments
and other assets and liabilities
denominated in foreign currencies 34,217,715 108,577,542 34,492,483
------------ ------------ ------------
Net assets applicable to capital shares
outstanding $215,337,245 $288,420,786 $ 86,047,343
============ ============ ============
Capital shares outstanding, an
unlimited number of no par value
shares authorized 25,181,847 17,314,523 9,825,529
============ ============ ============
NET ASSET VALUE, PUBLIC OFFERING
PRICE, REDEMPTION PRICE, PER SHARE $ 8.55 $ 16.66 $ 8.76
============ ============ ============
95
- ---------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (UNAUDITED)
- ---------------------------------------------------------------------------
U.S. TREASURY
SECURITIES
CASH FUND
NET INVESTMENT INCOME
INCOME:
- ---------------------------------------------------------------------------
Interest and other $649,458
--------
TOTAL INCOME 649,458
EXPENSES:
- ---------------------------------------------------------------------------
Management fee 316,403
Transfer agent fees and expenses 122,315
Accounting service fees and expenses 20,219
Professional fees 22,801
Custodian fees 66,163
Shareholder reporting 39,152
Registration fees 14,562
Trustee fees and expenses 9,200
Miscellaneous 27,626
-------
Total expenses before reductions 638,441
Expenses offset - Note 1 J (6)
Expenses reimbursed - Note 2 (28,023)
-------
NET EXPENSES 610,412
- ---------------------------------------------------------------------------
NET INVESTMENT INCOME 39,046
- ---------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
LOSS ON INVESTMENTS
Net realized loss from securities --
Net change in unrealized depreciation of investments --
- ---------------------------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS --
- ---------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $39,046
=======
See accompanying notes to financial statements.
96
- ------------------------------------------------------------------------------
For the Six Months Ended December 31, 2003
- ------------------------------------------------------------------------------
U.S. GOVERNMENT
SECURITIES NEAR-TERM TAX FREE
SAVINGS FUND TAX FREE FUND FUND
NET INVESTMENT INCOME
INCOME:
- --------------------------------------------------------------------------------------------------
Interest and other $2,669,088 $339,393 $986,956
---------- -------- --------
TOTAL INCOME 2,669,088 339,393 986,956
EXPENSES:
- --------------------------------------------------------------------------------------------------
Management fee 1,115,279 53,567 186,582
Transfer agent fees and expenses 263,138 7,848 10,452
Accounting service fees and expenses 34,093 20,219 20,219
Professional fees 25,310 17,091 17,275
Custodian fees 48,624 7,617 9,553
Shareholder reporting 68,097 2,460 3,140
Registration fees 23,787 8,835 7,687
Trustee fees and expenses 9,200 9,200 9,200
Miscellaneous 60,839 2,172 3,268
---------- -------- --------
Total expenses before reductions 1,648,367 129,009 267,376
Expenses offset - Note 1 J -- (5) (41)
Expenses reimbursed - Note 2 (499,582) (80,795) (93,192)
---------- -------- --------
NET EXPENSES 1,148,785 48,209 174,143
- --------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 1,520,303 291,184 812,813
- --------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
LOSS ON INVESTMENTS
Net realized loss from securities (2,426) (55,742) (76,361)
Net change in unrealized depreciation of
investments -- (128,069) (704,881)
- --------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS (2,426) (183,811) (781,242)
- --------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTS FROM OPERATIONS $1,517,877 $107,373 $ 31,571
========== ======== ========
97
- -------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (UNAUDITED)
- -------------------------------------------------------------------------------
ALL AMERICAN CHINA REGION
EQUITY FUND OPPORTUNITY FUND
NET INVESTMENT INCOME
INCOME:
- ----------------------------------------------------------------------------------
Dividends $ 125,587 $ 207,293
Foreign taxes withheld on dividends (3,961) (4,567)
---------- -----------
Net dividends 121,626 202,726
Interest and other (net of foreign taxes
withheld $0, $871, $0, $0, $0) 4,138 21,736
---------- -----------
TOTAL INCOME 125,764 224,462
EXPENSES:
- ----------------------------------------------------------------------------------
Management fee 72,562 168,958
Transfer agent fees and expenses 52,700 29,791
Accounting service fees and expenses 20,219 21,393
Professional fees 29,007 23,957
Custodian fees 13,199 29,755
Shareholder reporting 13,948 9,076
Registration fees 6,957 6,180
Trustee fees and expenses 9,200 9,200
Miscellaneous 7,323 6,290
---------- -----------
Total expenses before reductions 225,115 304,600
Expenses offset - Note 1 J (38) (89)
Expenses reimbursed - Note 2 (55,767) --
---------- -----------
NET EXPENSES 169,310 304,511
- ----------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS) (43,546) (80,049)
- ----------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Realized gain (loss) from:
Securities 490,800 371,119
Foreign currency transactions (257) (7,995)
---------- -----------
NET REALIZED GAIN 490,543 363,124
---------- -----------
Net change in unrealized appreciation
(depreciation) of:
Investments 2,901,771 11,079,379
Other assets and liabilities
denominated in foreign currencies 13 (4,414)
---------- -----------
NET UNREALIZED APPRECIATION 2,901,784 11,074,965
- ----------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS 3,392,327 11,438,089
- ----------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $3,348,781 $11,358,040
========== ===========
See accompanying notes to financial statements.
98
- -----------------------------------------------------------------------------------------------------------
For the Six Months Ended December 31, 2003
- -----------------------------------------------------------------------------------------------------------
GLOBAL RESOURCES WORLD PRECIOUS GOLD SHARES
FUND MINERALS FUND FUND
NET INVESTMENT INCOME
INCOME:
- -----------------------------------------------------------------------------------------------------------
Dividends $ 728,977 $ 225,330 $ 164,423
Foreign taxes withheld on dividends (87,155) (12,985) (7,015)
----------- ------------ -----------
Net dividends 641,822 212,345 157,408
Interest and other (net of foreign taxes
withheld $0, $871, $0, $0, $0) 55,101 121,573 30,748
----------- ------------ -----------
TOTAL INCOME 696,923 333,918 188,156
EXPENSES:
- -----------------------------------------------------------------------------------------------------------
Management fee 311,362 902,103 241,200
Transfer agent fees and expenses 34,654 128,236 167,650
Accounting service fees and expenses 25,495 44,105 27,800
Professional fees 40,901 62,820 45,054
Custodian fees 35,569 83,268 43,505
Shareholder reporting 11,735 36,076 60,581
Registration fees 6,277 11,160 11,125
Trustee fees and expenses 9,200 9,200 9,200
Miscellaneous 8,843 24,512 21,462
----------- ------------ -----------
Total expenses before reductions 484,036 1,301,480 627,577
Expenses offset - Note 1 J (171) (359) (89)
Expenses reimbursed - Note 2 -- -- --
----------- ------------ -----------
NET EXPENSES 483,865 1,301,121 627,488
- -----------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS) 213,058 (967,203) (439,332)
- -----------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN ON
INVESTMENTS
Realized gain (loss) from:
Securities 613,935 12,543,141 7,655,710
Foreign currency transactions (167,662) (232,097) (6,608)
----------- ------------ -----------
NET REALIZED GAIN 446,273 12,311,044 7,649,102
----------- ------------ -----------
Net change in unrealized appreciation
(depreciation) of:
Investments 30,818,707 99,558,815 25,039,112
Other assets and liabilities
in foreign currencies (40,556) 3,214 31,889
----------- ------------ -----------
NET UNREALIZED APPRECIATION 30,778,151 99,562,029 25,071,001
- -----------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS 31,224,424 111,873,073 32,720,103
- -----------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $31,437,482 $110,905,870 $32,280,771
=========== ============ ===========
99
- -----------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- -----------------------------------------------------------------------------------------
U.S. TREASURY SECURITIES
CASH FUND
-------------------------------------
SIX MONTHS ENDED
DECEMBER 31, 2003 YEAR ENDED
(UNAUDITED) JUNE 30, 2003
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- -----------------------------------------------------------------------------------------
Net investment income $ 39,046 $ 680,359
Net realized gain (loss) -- (285)
Net unrealized appreciation (depreciation) -- --
------------ ------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 39,046 680,074
DISTRIBUTIONS TO SHAREHOLDERS:
- -----------------------------------------------------------------------------------------
From net investment income (47,110) (751,704)
------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (47,110) (751,704)
FROM CAPITAL SHARE TRANSACTIONS:
- -----------------------------------------------------------------------------------------
Proceeds from shares sold 444,964,400 863,618,552
Distributions reinvested 34,790 710,363
------------ ------------
444,999,190 864,328,915
Cost of shares redeemed (447,589,497) (875,308,077)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS FROM
CAPITAL SHARE TRANSACTIONS (2,590,307) (10,979,162)
- -----------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (2,598,371) (11,050,792)
- -----------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 123,879,278 134,930,070
- -----------------------------------------------------------------------------------------
END OF PERIOD $121,280,907 $123,879,278
- -----------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(loss), end of period $ (5,120) $ 2,944
============ ============
CAPITAL SHARE ACTIVITY
- -----------------------------------------------------------------------------------------
Shares sold 444,964,400 863,618,552
Shares reinvested 34,790 710,363
Shares redeemed (447,589,497) (875,308,077)
------------ ------------
NET SHARE ACTIVITY (2,590,307) (10,979,162)
============ ============
See accompanying notes to financial statements.
100
- --------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT SECURITIES
SAVINGS FUND NEAR-TERM TAX FREE FUND
--------------------------------------- ---------------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, 2003 YEAR ENDED DECEMBER 31, 2003 YEAR ENDED
(UNAUDITED) JUNE 30, 2003 (UNAUDITED) JUNE 30, 2003
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- --------------------------------------------------------------------------------------------------------------------------------
Net investment income $ 1,520,303 $ 6,615,154 $ 291,184 $ 476,265
net realized gain (loss) (2,426) (9,319) (55,742) 35,407
Net unrealized appreciation
(depreciation) -- -- (128,069) 395,074
------------ ------------ ----------- -----------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 1,517,877 6,605,835 107,373 906,746
DISTRIBUTIONS TO SHAREHOLDERS:
- -------------------------------------------------------------------------------------------------------------------------------
From net investment income (1,597,019) (6,815,829) (289,844) (478,091)
------------ ------------ ----------- -----------
TOTAL DISTRIBUTIONS TO
SHAREHOLDERS (1,597,019) (6,815,829) (289,844) (478,091)
FROM CAPITAL SHARE TRANSACTIONS:
- -------------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 154,660,309 335,896,920 5,161,055 17,450,837
Distributions reinvested 1,292,610 6,670,375 218,744 441,277
------------ ------------ ----------- -----------
155,952,919 342,567,295 5,379,799 17,892,114
Cost of shares redeemed (207,962,246) (504,370,898) (7,469,789) (6,093,639)
------------ ------------ ----------- -----------
NET INCREASE (DECREASE) IN
NET ASSETS FROM CAPITAL SHARE
TRANSACTIONS (52,009,327) (161,803,603) (2,089,990) 11,798,475
- -------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (52,088,469) (162,013,597) (2,272,461) 12,227,130
- -------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 529,829,247 691,842,844 21,978,787 9,751,657
- -------------------------------------------------------------------------------------------------------------------------------
END OF PERIOD $477,740,778 $529,829,247 $19,706,326 $21,978,787
- -------------------------------------------------------------------------------------------------------------------------------
Accumulated undistributed net investment
income (loss), end of period $ 404,082 $ 480,798 $ 11,734 $ 10,394
============ ============ =========== ===========
CAPITAL SHARE ACTIVITY
- -------------------------------------------------------------------------------------------------------------------------------
Shares sold 154,660,309 335,896,920 466,437 1,581,563
Shares reinvested 1,292,610 6,670,375 19,854 40,016
Shares redeemed (207,962,246) (504,370,898) (678,924) (551,304)
------------ ------------ ----------- -----------
NET SHARE ACTIVITY (52,009,327) (161,803,603) (192,633) 1,070,275
============ ============ =========== ===========
101
- ------------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------
TAX FREE FUND
---------------------------------------
SIX MONTHS ENDED
DECEMBER 31, 2003 YEAR ENDED
(UNAUDITED) JUNE 30, 2003
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- ------------------------------------------------------------------------------------------
Net investment income (loss) $ 812,813 $ 1,213,285
Net realized gain (loss) (76,361) 152,900
Net unrealized appreciation (depreciation) (704,881) 1,440,495
------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 31,571 2,806,680
DISTRIBUTIONS TO SHAREHOLDERS:
- ------------------------------------------------------------------------------------------
From net investment income (809,054) (1,213,917)
------------ -----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (809,054) (1,213,917)
FROM CAPITAL SHARE TRANSACTIONS:
- ------------------------------------------------------------------------------------------
Proceeds from shares sold 12,569,039 49,605,702
Distributions reinvested 629,069 1,098,784
Paid-in capital portion of short-term trading
fee -- --
------------ -----------
13,198,108 50,704,486
Cost of shares redeemed (24,241,742) (18,712,637)
------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS (11,043,634) 31,991,849
- ------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (11,821,117) 33,584,612
- ------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 55,282,690 21,698,078
- ------------------------------------------------------------------------------------------
END OF PERIOD $ 43,461,573 $55,282,690
- ------------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(loss), end of period $ 24,749 $ 20,990
============ ===========
CAPITAL SHARE ACTIVITY
- ------------------------------------------------------------------------------------------
Shares sold 1,018,000 4,005,999
Shares reinvested 51,072 88,017
Shares redeemed (1,957,914) (1,505,744)
------------ -----------
NET SHARE ACTIVITY (888,842) 2,588,272
============ ===========
See accompanying notes to financial statements.
102
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
CHINA REGION
ALL AMERICAN EQUITY FUND OPPORTUNITY FUND
--------------------------------------- ---------------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, 2003 YEAR ENDED DECEMBER 31, 2003 YEAR ENDED
(UNAUDITED) JUNE 30, 2003 (UNAUDITED) JUNE 30, 2003
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- --------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) $ (43,546) $ (21,087) $ (80,049) $ (62,507)
Net realized gain (loss) 490,543 (1,452,818) 363,124 (992,220)
Net unrealized appreciation
(depreciation) 2,901,784 (487,063) 11,074,965 413,867
----------- ----------- ----------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS 3,348,781 (1,960,968) 11,358,040 (640,860)
DISTRIBUTIONS TO SHAREHOLDERS:
- --------------------------------------------------------------------------------------------------------------------------------
From net investment income -- -- (389,832) --
----------- ----------- ----------- -----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS -- -- (389,832) --
FROM CAPITAL SHARE TRANSACTIONS:
- --------------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 2,933,554 4,900,381 45,433,814 12,455,142
Distributions reinvested -- -- 375,803 --
Paid-in capital portion of
short-term trading fee 975 1,748 94,107 31,567
----------- ----------- ----------- -----------
2,934,529 4,902,129 45,903,724 12,486,709
Cost of shares redeemed (3,987,511) (5,320,669) (16,143,088) (11,033,754)
----------- ----------- ----------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS FROM CAPITAL SHARE
TRANSACTIONS (1,052,982) (418,540) 29,760,636 1,452,955
- --------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 2,295,799 (2,379,508) 40,728,844 812,095
- --------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 18,333,874 20,713,382 12,814,645 12,002,550
- --------------------------------------------------------------------------------------------------------------------------------
END OF PERIOD $20,629,673 $18,333,874 $53,543,489 $12,814,645
- --------------------------------------------------------------------------------------------------------------------------------
Accumulated undistributed net investment
income (loss), end of period $ (43,546) $ -- $ (473,077) $ (3,196)
=========== =========== =========== ===========
CAPITAL SHARE ACTIVITY
- --------------------------------------------------------------------------------------------------------------------------------
Shares sold 143,507 276,632 7,870,387 3,269,404
Shares reinvested -- -- 58,903 --
Shares redeemed (195,091) (296,261) (2,843,545) (2,939,535)
----------- ----------- ----------- -----------
NET SHARE ACTIVITY (51,584) (19,629) 5,085,745 329,869
=========== =========== =========== ===========
103
- -----------------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- -----------------------------------------------------------------------------------------
GLOBAL RESOURCES FUND
-------------------------------------
SIX MONTHS ENDED
DECEMBER 31, 2003 YEAR ENDED
(UNAUDITED) JUNE 30, 2003
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
- ------------------------------------------------------------------------------------------
Net investment income (loss) $ 213,058 $ (145,113)
Net realized gain (loss) 446,273 21,597
Net unrealized appreciation (depreciation) 30,778,151 707,173
------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 31,437,482 583,657
DISTRIBUTIONS TO SHAREHOLDERS:
- ------------------------------------------------------------------------------------------
From net investment income (2,895,600) (230,003)
------------ -----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (2,895,600) (230,003)
FROM CAPITAL SHARE TRANSACTIONS:
- ------------------------------------------------------------------------------------------
Proceeds from shares sold 191,978,570 9,565,719
Distributions reinvested 2,804,886 216,460
Paid-in capital portion of short-term trading
fee 13,254 9,913
------------ -----------
194,796,710 9,792,092
Cost of shares redeemed (22,885,554) (10,161,261)
------------ -----------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS 171,911,156 (369,169)
- ------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 200,453,038 (15,515)
- ------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 14,884,207 14,899,722
- ------------------------------------------------------------------------------------------
END OF PERIOD $215,337,245 $14,884,207
- ------------------------------------------------------------------------------------------
Accumulated undistributed net investment loss, end
of period $ (3,100,701) $ (418,159)
============ ===========
CAPITAL SHARE ACTIVITY
- ------------------------------------------------------------------------------------------
Shares sold 24,985,206 2,089,242
Shares reinvested 340,812 51,172
Shares redeemed (3,038,172) (2,270,820)
------------ -----------
NET SHARE ACTIVITY 22,287,846 (130,406)
============ ===========
See accompanying notes to financial statements.
104
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
WORLD PRECIOUS
MINERALS FUND GOLD SHARES FUND
------------------------------------- -------------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, 2003 YEAR ENDED DECEMBER 31, 2003 YEAR ENDED
(UNAUDITED) JUNE 30, 2003 (UNAUDITED) JUNE 30, 2003
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS:
- -------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) $ (967,203) $ (1,000,567) $ (439,332) $ (877,419)
Net realized gain (loss) 12,311,044 4,176,697 7,649,102 (1,333,628)
Net unrealized appreciation
(depreciation) 99,562,029 (6,590,466) 25,071,001 134,090
------------ ------------ ----------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM OPERATIONS 110,905,870 (3,414,336) 32,280,771 (2,076,957)
DISTRIBUTIONS TO SHAREHOLDERS:
- --------------------------------------------------------------------------------------------------------------------------
From net investment income (28,067,072) (2,305,012) (247,151) --
------------ ------------ ----------- -----------
TOTAL DISTRIBUTIONS TO
SHAREHOLDERS (28,067,072) (2,305,012) (247,151) --
FROM CAPITAL SHARE TRANSACTIONS:
- --------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 442,060,474 617,471,740 114,213,315 108,006,550
Distributions reinvested 26,655,112 2,200,668 232,435 --
Paid-in capital portion of
short-term trading fee 641,138 1,402,876 208,576 207,077
------------ ------------ ----------- -----------
469,356,724 621,075,284 114,654,326 108,213,627
Cost of shares redeemed (370,987,080) (605,187,869) (106,360,155) (113,328,412)
------------ ------------ ----------- -----------
NET INCREASE (DECREASE) IN NET
ASSETS FROM CAPITAL SHARE
TRANSACTIONS 98,369,644 15,887,415 8,294,171 (5,114,785)
- --------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 181,208,442 10,168,067 40,327,791 (7,191,742)
- --------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 107,212,344 97,044,277 45,719,552 52,911,294
- --------------------------------------------------------------------------------------------------------------------------
END OF PERIOD $288,420,786 $107,212,344 $86,047,343 $45,719,552
- --------------------------------------------------------------------------------------------------------------------------
Accumulated undistributed net investment
loss, end of period $(32,515,326) $ (3,481,051) $ (715,581) $ (29,098)
============ ============ =========== ===========
CAPITAL SHARE ACTIVITY
- --------------------------------------------------------------------------------------------------------------------------
Shares sold 32,250,690 68,090,367 16,559,673 22,960,311
Shares reinvested 1,746,731 231,893 28,802 --
Shares redeemed (27,678,523) (66,629,273) (15,589,741) (24,159,232)
------------ ------------ ----------- -----------
NET SHARE ACTIVITY 6,318,898 1,692,987 998,734 (1,198,921)
============ ============ =========== ===========
105
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
NOTE 1: SIGNIFICANT ACCOUNTING POLICIES
U.S. Global Investors Funds (Trust) is organized as a Massachusetts
business trust, consisting of nine separate funds (funds), as
follows: U.S. Treasury Securities Cash, U.S. Government Securities
Savings, Near-Term Tax Free, Tax Free, All American Equity, China
Region Opportunity, Global Resources, World Precious Minerals and
Gold Shares. The Trust is an open-end management investment company
registered under the Investment Company Act of 1940, as amended.
All funds are diversified with the exception of China Region
Opportunity, Global Resources, World Precious Minerals and Gold
Shares.
The following is a summary of significant accounting policies
consistently followed by the funds in the preparation of their
financial statements. The policies are in conformity with
accounting principles generally accepted in the United States.
A. SECURITY VALUATIONS
The funds value investments traded on national or international
securities exchanges or over-the-counter at the last sales price
reported by the security's primary exchange at the time of daily
valuation. Securities for which no sale was reported are valued at
the mean between the last reported bid and asked prices or using
quotes provided by principal market makers. Short-term investments
with effective maturities of sixty days or less at the date of
purchase and investments of U.S. Treasury Securities Cash and U.S.
Government Securities Savings Funds are valued at amortized cost,
which approximates market value. An independent pricing service
values municipal securities and long-term U.S. Government
obligations using a system based on such factors as credit rating,
maturity, coupon and type of security to determine fair value.
B. FAIR VALUED SECURITIES
Securities for which market quotations are not readily available or
which are subject to legal restrictions are valued at their fair
value as determined in good faith under consistently applied
procedures under the general supervision of the Board of Trustees.
The following factors are generally considered in determining fair
value: nature and duration of any trading restrictions, trading
volume, market values of unrestricted shares of the same or similar
class, investment management's judgment regarding the market
experience of the issuer, financial status and other operational
and market factors affecting the issuer, issuer's management,
quality of the underlying property based on review of independent
geological studies, the extent of the fund's investment in the
trading securities of the issuer; and other relevant matters. The
fair values may differ from what would have been used had a broader
market for these securities existed.
For securities traded on international exchanges, if events which
may materially affect the value of the fund's securities occur
after the close of the primary
106
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
exchange and before the fund's net asset value is next determined then
those securities will be valued at their fair value as determined in good
faith under the supervision of the Board of Trustees.
C. SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are accounted for on trade date. Realized
gains and losses from security transactions are determined on an
identified-cost basis. Dividend income is recorded on the
ex-dividend date, except that certain dividends from foreign
securities where the ex-dividend date may have passed are recorded
as soon as the funds are informed of the ex-dividend data in the
exercise of reasonable diligence. Interest income, which may
include original issue discount, is recorded on an accrual basis.
Discounts and premiums on securities purchased are accreted and
amortized, respectively, on a yield-to-maturity basis as
adjustments to interest income.
The funds may purchase securities on a when-issued or
delayed-delivery basis and segregate the liquid assets on their
books to collateralize the obligation until trade settlement. Such
investments are accounted for in the same manner as marketable
portfolio securities.
The equity funds may invest in private placements and initial
public offerings (IPOs), the volatility of which may significantly
affect performance. There is no guarantee that these high-risk
investments will affect a fund's performance in the same way in the
future.
Each fund may temporarily loan securities up to 10% of its total
assets to brokers, dealers or other financial institutions in
exchange for a negotiated lender's fee. These fees are recorded as
securities lending income. The loans are collateralized by cash,
U.S. government securities, high quality money market instruments
or other securities that are maintained at all times in an amount
at least equal to the current market value of the loaned
securities, plus a margin depending on the types of securities
loaned. The market value of the loaned securities is determined at
the close of business of the fund and any additional required
collateral is delivered to the fund on the next business day. In
the event of default or bankruptcy by the borrower, retention of
the collateral may be subject to legal proceedings. The securities
lending agreement was terminated in fiscal 2003. There were no
securities on loan at December 31, 2003.
D. REPURCHASE AGREEMENTS
The funds may enter into repurchase agreements with recognized
financial institutions or registered broker-dealers and, in all
instances, hold as collateral, underlying securities with a value
exceeding the total repurchase price, including accrued interest.
The funds use joint tri-party repurchase agreements with other
funds under common management where uninvested cash is collectively
invested in
107
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
repurchase agreements, and each participating fund owns an undivided
interest in the account.
E. OPTIONS
Some funds may write or purchase options on securities to manage
their exposure to stock or commodity markets as well as
fluctuations in interest and currency conversion rates. Written
options include a risk of loss in excess of the option premium. The
use of options carries the risk of a change in value of the
underlying instruments, an illiquid secondary market, or that the
counterparty may fail to perform its obligations. The option
premium is the basis for recognition of unrealized or realized gain
or loss on the option. The cost of securities acquired or the
proceeds from securities sold through the exercise of the option is
adjusted by the amount of the premium. There were no written
options open at December 31, 2003.
Purchase option transactions during the six months ended December
31, 2003 were as follows:
WORLD PRECIOUS
GLOBAL RESOURCES FUND MINERALS FUND GOLD SHARES FUND
---------------------------------------------------------------------------------------
NUMBER OF PREMIUMS NUMBER OF PREMIUMS NUMBER OF PREMIUMS
CONTRACTS PAID/(RECEIVED) CONTRACTS PAID/(RECEIVED) CONTRACTS PAID/(RECEIVED)
Options outstanding
at June 30, 2003 200 $ 38,583 21,550 $ 2,514,891 11,650 $1,460,779
Options purchased 1,250 93,750 4,000 298,000 1,250 93,750
Options sold (200) (38,583) (9,600) (1,428,395) (5,400) (897,035)
Options expired -- -- (6,750) (414,500) (3,450) (201,900)
----- -------- ------ ----------- ------ ----------
Options outstanding
at December 31, 2003 1,250 $ 93,750 9,200 $ 969,996 4,050 $ 455,594
===== ======== ====== =========== ====== ==========
F. FOREIGN CURRENCY TRANSACTIONS
Some funds may invest in securities of foreign issuers. The
accounting records of these funds are maintained in U.S. dollars.
At each net asset value determination date, the value of assets and
liabilities denominated in foreign currencies are translated into
U.S. dollars using the current exchange rate. Security
transactions, income and expenses are converted to U.S. dollars at
the prevailing rate of exchange on the date of the event. The
effect of changes in foreign exchange rates on foreign denominated
securities is included with the net realized and unrealized gain or
loss on securities. Other unrealized foreign currency gains or
losses are reported separately.
G. FORWARD FOREIGN CURRENCY CONTRACTS
The funds may enter into forward foreign currency contracts to lock
in the U.S. dollar cost of purchase and sale transactions. A
forward foreign currency contract is a commitment to purchase or
sell a foreign currency at a future date at a negotiated rate.
These contracts are valued daily, and the fund's net equity
therein, representing unrealized gain or loss on the contracts as
measured by the
108
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
difference between the forward foreign exchange rates at the dates of entry
into the contracts and the forward rates at the reporting, is included in
the statement of assets and liabilities. Realized and unrealized gains and
losses are included in the statement of operations. Risks may arise upon
entering into these contracts from the potential inability of
counterparties to meet the terms of the contract and from unanticipated
movements in the value of foreign currencies relative to the U.S. dollar.
Open forward foreign currency contracts at December 31, 2003 were:
FOREIGN IN EXCHANGE SETTLEMENT UNREALIZED UNREALIZED
FUND CONTRACT CURRENCY FOR USD DATE VALUE APPRECIATION (DEPRECIATION)
------------------------------------------------------------------------------------------------------------------------
Global Resources
PURCHASES:
Canadian Dollar 1,188,486 $ 911,346 12/31/03 $ 919,418 $ 8,072 $ --
Canadian Dollar 880,000 681,115 12/31/03 680,772 -- (343)
Canadian Dollar 1,730,433 1,328,038 01/02/04 1,338,671 10,633 --
Canadian Dollar 200,000 154,799 01/02/04 154,721 -- (78)
--------- ---------- ---------- ------- -------
3,998,919 3,075,298 3,093,582 18,705 (421)
World Precious Minerals
PURCHASES:
Canadian Dollar 99,264 $ 76,117 12/31/03 $ 76,791 $ 674 $ --
Canadian Dollar 2,090,000 1,617,647 12/31/03 1,616,834 -- (813)
Canadian Dollar 849,375 651,861 01/02/04 657,080 5,219 --
Canadian Dollar 300,000 232,198 01/07/04 232,081 -- (117)
--------- ---------- ---------- ------- -------
3,338,639 2,577,823 2,582,786 5,893 (930)
Gold Shares
SALES:
Canadian Dollar 198,200 $ 152,087 12/31/03 $ 153,328 $ -- $(1,241)
H. FEDERAL INCOME TAXES
The funds intend to continue to comply with the requirements of
Subchapter M of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of their
taxable income to shareholders. Accordingly, no provision for
federal income taxes is required.
I. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
The funds record dividends and distributions to shareholders on the
ex-dividend date. Distributions are determined in accordance with
income tax regulations, which may differ from accounting principles
generally accepted in the United States. Accordingly, periodic
reclassifications are made within the funds' capital accounts to
reflect income and gains available for distribution under income
tax regulations.
The funds generally make distributions at least annually. The U.S.
Treasury Securities Cash and U.S. Government Securities Savings
Funds accrue dividends, on a daily basis with payment monthly. Tax
Free and Near-Term Tax Free pay monthly dividends. Dividends and
distributions payable at period end are processed for reinvestment
on the following business day.
109
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
J. EXPENSES
Each fund bears expenses incurred specifically on its behalf plus
an allocation of its share of Trust level expenses. Expense offset
arrangements have been made with the funds' custodian so the
custodian fees may be paid indirectly by credits earned on the
funds' cash balances. Such deposit arrangements are an alternative
to overnight investments.
K. SHORT-TERM TRADING (REDEMPTION) FEES
Shares held in the All American Equity Fund less than 30 days are
subject to a short-term trading fee equal to 0.10% of the proceeds
of the redeemed shares. Shares held in the China Region Opportunity
Fund less than 180 days are subject to a short-term trading fee
equal to 1.00% of the proceeds of the redeemed shares. Shares held
in the Global Resources, World Precious Minerals and Gold Shares
Funds held less than 30 days are subject to a short-term trading
fee equal to 0.25% of the proceeds of the redeemed shares. These
fees, which are retained by the funds, are accounted for as an
addition to paid-in capital.
L. USE OF ESTIMATES IN FINANCIAL STATEMENT PREPARATION
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that affect
the reported amounts 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 period. Actual results could differ from those
estimates.
NOTE 2: RELATED PARTY TRANSACTIONS
U.S. Global Investors, Inc. (Adviser), under an investment advisory
agreement with the Trust in effect through February 28, 2005,
furnishes management and investment advisory services and, subject
to the supervision of the Trustees, directs the investments of each
fund according to its investment objectives, policies and
limitations. The Adviser also furnishes all necessary office
facilities, business equipment and personnel for administering the
affairs of the Trust. Frank E. Holmes, a trustee of the funds, is
the controlling owner of the Adviser.
110
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
For the services of the Adviser, each fund pays a management fee
based upon its net assets. Fees are accrued daily and paid monthly.
The contractual management fee for each fund is:
ANNUAL PERCENTAGE OF
FUND AVERAGE DAILY NET ASSETS
--------------------------------------------------------------------
Gold Shares, All American .75% of the first $250,000,000 and
Equity and Tax Free .50% of the excess
U.S. Treasury Securities Cash .50% of the first $250,000,000 and
and U.S. Government Securities .375% of the excess
Savings
World Precious Minerals and 1.00% of the first $250,000,000 and
Global Resources .50% of the excess
Near-Term Tax Free 0.50%
China Region Opportunity 1.25%
The Adviser has voluntarily agreed to reimburse specific funds so
that their total operating expenses will not exceed certain annual
percentages of average net assets. The expenses for the six months
ended December 31, 2003 were voluntarily limited as follows: U.S.
Government Securities Savings at 0.45%, Near-Term Tax Free at 0.45%,
Tax Free at 0.70% and All American Equity at 1.75%. In addition,
the Adviser has contractually limited total fund operating expenses
to not exceed 0.45% for the U.S. Government Securities Savings
Fund, 0.45% for the Near-Term Tax Free Fund, 0.70% for the Tax Free
Fund and 1.75% for the All American Equity Fund on an annualized
basis through June 30, 2004, and until such later date as the
Adviser determines.
The Adviser has also voluntarily agreed to waive fees and/or
reimburse U.S. Treasury Securities Cash Fund and U.S. Government
Securities Savings Fund to the extent necessary to maintain the
fund's yield at a certain level as determined by the Adviser
(Minimum Yield). The Adviser may recapture any fees waived and/or
expenses reimbursed within three years after the end of the fiscal
year of such waiver and/or reimbursement to the extent that such
recapture would not cause the fund's yield to fall below the
Minimum Yield. For the six months ended December 31, 2003, fees
waived and/or expenses reimbursed as a result of this agreement
were $28,023 and $0 for the U.S. Treasury Securities Cash Fund and
the U.S. Government Securities Savings Fund, respectively. These
amounts are recoverable by the Adviser through June 30, 2007.
United Shareholder Services, Inc. (USSI), a wholly-owned subsidiary
of the Adviser, is the transfer agent for the funds. Each fund pays
an annual fee based on its number of shareholder accounts for
transfer agency services. Certain account fees are paid directly by
shareholders to the transfer agent, which, in turn, reduces its
charge to the funds. Brown Brothers Harriman & Co. serves as the
custodian,
111
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
fund accounting and administration service agent with a fee
structure based primarily on average net assets of the funds.
Additionally, the Adviser was reimbursed for in-house legal and
internal administration services pertaining to each fund during the
six months ended December 31, 2003, in the amounts of $116,483 and
$16,004, respectively.
During the six months ended December 31, 2003, A & B Mailers, Inc.,
a wholly-owned subsidiary of the Adviser, was paid $152,320 for
mailing services provided to the funds.
The five independent Trustees receive compensation for serving on
the Board. The Chairman and members of special committees receive
additional compensation. Trustees are also reimbursed for
out-of-pocket expenses incurred while attending meetings. Frank E.
Holmes receives no compensation from the funds for serving on the
Board.
NOTE 3: INVESTMENT ACTIVITY
Purchases and sales of long-term securities for the six months
ended December 31, 2003, are summarized as follows:
FUND PURCHASES SALES
----------------------------------------------------------------------
Near-Term Tax Free $ 2,556,107 $ 4,086,384
Tax Free 6,249,728 13,976,917
All American Equity 8,147,151 9,105,857
China Region Opportunity 30,018,077 6,083,966
Global Resources 142,293,358 3,578,888
World Precious Minerals 133,354,294 81,194,485
Gold Shares 27,222,138 31,737,134
U.S. Treasury Securities Cash and U.S. Government Securities
Savings held only short-term investments. The funds neither
purchased nor sold long-term U.S. government securities during the
period.
Investments in foreign issuers as a percent of total investments at
December 31, 2003 were: 81.08% of China Region Opportunity, 57.11%
of Global Resources, 82.15% of World Precious Minerals and 76.36%
of Gold Shares.
112
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
NOTE 4: TAX INFORMATION
The following table presents the income tax basis of the securities
owned at December 31, 2003, and the tax basis components of net
unrealized appreciation or depreciation:
GROSS GROSS NET UNREALIZED
AGGREGATE UNREALIZED UNREALIZED APPRECIATION
FUND TAX COST APPRECIATION DEPRECIATION (DEPRECIATION)
------------------------------------------------------------------------------------------
U.S. Treasury Securities Cash $121,104,254 $ -- $ -- $ --
U.S. Government Securities
Savings 476,949,478 -- -- --
Near-Term Tax Free 19,019,664 516,466 (13,809) 502,657
Tax Free 41,642,693 1,513,536 (47,020) 1,466,516
All American Equity 16,640,505 3,892,902 (330,853) 3,562,049
China Region Opportunity 43,069,349 11,537,227 (1,417,069) 10,120,158
Global Resources 187,045,522 35,179,673 (920,458) 34,259,215
World Precious Minerals 176,646,480 115,350,602 (6,775,933) 108,574,669
Gold Shares 50,101,828 34,663,771 (203,740) 34,460,031
All distributions paid during the six months ended December 31,
2003, as shown on the Statements of Changes in Net Assets, are
taxable as ordinary income to shareholders.
Net realized capital loss carryforwards, for federal income tax
purposes, may be used to offset current or future capital gains
until expiration. The funds' tax-basis capital gains and losses are
determined only at the end of each fiscal year. The loss
carryforwards and related expiration dates for each fund, as of
June 30, 2003, are as follows:
LOSS EXPIRATION
FUND CARRYFORWARDS DATE
-------------------------------------------------------------------------------------
U.S. Treasury Securities Cash $ 18,472 2007 - 2011
U.S. Government Securities Savings 1,087,560 2004 - 2005
Near-Term Tax Free 77,044 2008 - 2009
Tax Free 338,259 2009
All American Equity 3,391,251 2010 - 2011
China Region Opportunity 14,881,948 2004 - 2011
Global Resources 8,949,840 2007 - 2011
World Precious Minerals 46,759,906 2007 - 2010
Gold Shares 136,323,572 2004 - 2011
113
- ----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2003
- ----------------------------------------------------------------------------
POST OCTOBER 31, 2002 POST OCTOBER 31, 2002
FUND CAPITAL LOSSES CURRENCY LOSS DEFERRAL
--------------------------------------------------------------------------------
U.S. Government Securities
Savings $ 9,653 $ --
All American Equity 212,876 --
China Region Opportunity 917,197 2,477
World Precious Minerals 355,549 --
Gold Shares -- 3,855
The amounts above, in accordance with tax rules, are deemed to have
occurred on July 1, 2003.
NOTE 5: RISKS OF CONCENTRATIONS
China Region Opportunity may be exposed to risks not typically
associated with investments in the United States, due to
concentration of investments in foreign issuers in the region.
These investments present risks resulting from disruptive political
or economic conditions and the potential imposition of adverse
governmental laws or currency exchange restrictions affecting the
area.
The investment policies of Gold Shares and World Precious Minerals
present unique risks to their respective portfolios' values. The
prices of gold and other precious metals may be subject to
fluctuations caused by international monetary and political
developments including trade or currency restrictions, currency
devaluation and revaluation, and social and political conditions
within a country. Fluctuations in the prices of gold and other
precious metals will affect the market values of the securities
held by these funds.
NOTE 6: CREDIT ARRANGEMENTS
Each of the U.S. Global Investors Funds, along with other funds
under common management, has a revolving credit facility with Brown
Brothers Harriman & Co. (BBH). Borrowings of each fund are
collateralized by any or all of the securities held by BBH as the
fund's custodian. Interest on borrowings is charged at the current
overnight Federal Funds Rate plus 2%. Each fund has a maximum
borrowing limit of 10% of qualified assets. The aggregate
borrowings by all the funds under the agreement cannot exceed
$10,000,000 at any one time. There were no borrowings under the
revolving credit facility at December 31, 2003.
NOTE 7: SHARES OF BENEFICIAL INTEREST
At December 31, 2003, individual shareholders holding more than 5%
of outstanding shares comprised 6.28% of the Near-Term Tax Free
Fund and 52.33% of the Tax Free Fund.
114
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -----------------------------------------------------------------------------
U.S. TREASURY SECURITIES CASH FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income --(a) .01 .01 .05 .04 .04
Net realized and unrealized gain -- -- -- -- -- --
-------- -------- -------- -------- -------- --------
Total from investment activities --(a) .01 .01 .05 .04 .04
-------- -------- -------- -------- -------- --------
Distributions from net investment income --(a) (.01) (.01) (.05) (.04) (.04)
- ------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (b) .04% .57% 1.43% 4.59% 4.49% 3.92%
Ratios to Average Net Assets (c):
Net investment income .06% .52% 1.43% 4.62% 4.33% 3.87%
Total expenses 1.00% .97% 1.00% 1.06% 1.04% 1.01%
Expenses reimbursed or offset (.04)% -- -- -- -- --
Net expenses .96% .97% 1.00% 1.06% 1.04% 1.01%
Net assets, end of period (in thousands) $121,281 $123,879 $134,930 $130,832 $137,172 $155,767
U.S. GOVERNMENT SECURITIES SAVINGS FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income --(a) .01 .02 .05 .05 .05
Net realized and unrealized gain --(a) -- -- -- -- --
-------- -------- -------- -------- -------- --------
Total from investment activities -- .01 .02 .05 .05 .05
-------- -------- -------- -------- -------- --------
Distributions from net investment income --(a) (.01) (.02) (.05) (.05) (.05)
- ------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (b) .32% 1.09% 2.20% 5.42% 5.44% 4.90%
Ratios to Average Net Assets (c):
Net investment income .60% 1.08% 2.20% 5.41% 5.26% 4.78%
Total expenses .65% .61% .59% .60% .60% .61%
Expenses reimbursed or offset (.20)% (.16)% (.14)% (.20)% (.20)% (.30)%
Net expenses .45% .45% .45% .40% .40% .31%
Net assets, end of period (in thousands) $477,741 $529,829 $691,843 $782,242 $755,140 $790,148
<FN>
(a)The per share amount does not round to a full penny.
(b)Total returns for periods less than one year are not annualized.
Assumes investment at the net asset value at the beginning of the
period, reinvestment of all distributions and a complete
redemption of the investment at the net asset value at the end of
the period.
(c)Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as
discussed in the notes to the financial statements. These amounts
would decrease the net investment income ratio had such
reductions not occurred.
See accompanying notes to financial statements.
</FN>
115
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -----------------------------------------------------------------------------
NEAR-TERM TAX FREE FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $11.14 $10.81 $10.61 $10.31 $10.47 $10.64
- ------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income .16 .32 .40 .43 .44 .42
Net realized and unrealized gain
(loss) (.08) .32 .19 .30 (.17) (.17)
------- ------- ------ ------ ------ ------
Total from investment activities .08 .64 .59 .73 .27 .25
------- ------- ------ ------ ------ ------
Distributions from net investment income (.15) (.31) (.39) (.43) (.43) (.42)
- ------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $11.07 $11.14 $10.81 $10.61 $10.31 $10.47
- ------------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (a) .76% 5.97% 5.65% 7.21% 2.65% 2.35%
Ratios to Average Net Assets (b):
Net investment income 2.72% 2.83% 3.73% 4.15% 4.10% 3.93%
Total expenses 1.20% 1.44% 2.63% 2.72% 2.45% 2.25%
Expenses reimbursed or offset (.75)% (.94)% (2.01)% (2.02)% (1.75)% (1.55)%
Net expenses .45% .50% .62% .70% .70% .70%
Portfolio turnover rate 13% 20% 19% 23% 24% 38%
Net assets, end of period (in thousands) $19,706 $21,979 $9,752 $6,035 $5,222 $7,411
TAX FREE FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $12.65 $12.18 $11.95 $11.38 $11.80 $12.20
- ----------------------------------------------------------------------------------------------------
Investment Activities
Net investment income .22 .42 .50 .53 .56 .55
Net realized and unrealized gain
(loss) (.18) .48 .23 .57 (.39) (.37)
------- ------- ------- ------- ------- -------
Total from investment activities .04 .90 .73 1.10 .17 .18
------- ------- ------- ------- ------- -------
Distributions
From net investment income (.21) (.43) (.50) (.53) (.55) (.55)
From net realized gains -- -- -- -- (.04) (.03)
------- ------- ------- ------- ------- -------
Total distributions (.21) (.43) (.50) (.53) (.59) (.58)
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.48 $12.65 $12.18 $11.95 $11.38 $11.80
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (a) .33% 7.49% 6.18% 9.81% 1.57% 1.39%
Ratios to Average Net Assets (b):
Net investment income 3.27% 3.34% 4.13% 4.50% 4.80% 4.54%
Total expenses 1.07% 1.22% 1.56% 1.53% 1.53% 1.45%
Expenses reimbursed or offset (.37)% (.52)% (.86)% (.83)% (.83)% (.75)%
Net expenses .70% .70% .70% .70% .70% .70%
Portfolio turnover rate 13% 26% 22% 19% 16% 42%
Net assets, end of period (in thousands) $43,462 $55,283 $21,698 $20,248 $18,380 $24,042
<FN>
(a)Total returns for periods less than one year are not annualized.
Assumes investment at the net asset value at the beginning of the
period, reinvestment of all distributions and a complete
redemption of the investment at the net asset value at the end of
the period.
(b)Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as
discussed in the notes to the financial statements. These amounts
would decrease the net investment income ratio had such
reductions not occurred.
See accompanying notes to financial statements.
</FN>
116
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -----------------------------------------------------------------------------
ALL AMERICAN EQUITY FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $19.15 $21.20 $25.44 $45.18 $44.78 $38.80
- ----------------------------------------------------------------------------------------------------
Investment Activities
Net investment income (loss) (.05) (.03) (.03) .08 .33 .26
Net realized and unrealized gain
(loss) 3.67 (2.02) (4.20) (11.42) .90 7.10
------- ------- ------- ------- ------- -------
Total from investment activities 3.62 (2.05) (4.23) (11.34) 1.23 7.36
------- ------- ------- ------- ------- -------
Distributions
From net investment income -- -- (.01) (.08) (.33) (.26)
From net realized gains -- -- -- (8.32) (.50) (1.12)
------- ------- ------- ------- ------- -------
Total distributions -- -- (.01) (8.40) (.83) (1.38)
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $22.77 $19.15 $21.20 $25.44 $45.18 $44.78
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (a) 18.90% (9.67)% (16.62)% (27.96)% 2.72% 19.49%
Ratios to Average Net Assets (b):
Net investment income (loss) (.45)% (.12)% (.12)% .25% .28% .66%
Total expenses 2.33% 2.56% 2.19% 1.69% 1.53% 1.56%
Expenses reimbursed or offset (.58)% (1.06)% (.73)% (.69)% (.53)% (.56)%
Net expenses 1.75% 1.50% 1.46% 1.00% 1.00% 1.00%
Portfolio turnover rate 45% 119% 75% 85% 21% 25%
Net assets, end of period (in thousands) $20,630 $18,334 $20,713 $26,942 $44,038 $53,202
CHINA REGION OPPORTUNITY FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $4.17 $4.38 $4.92 $6.11 $5.58 $4.09
- ----------------------------------------------------------------------------------------------------
Investment Activities
Net investment loss (.01) (.02) (.04) (.04) (.02) (.03)
Net realized and unrealized gain
(loss) 2.45 (.19) (.50) (1.09) .55 1.55
------- ------- ------- ------- ------- -------
Total from investment activities 2.44 (.21) (.54) (1.13) .53 1.52
------- ------- ------- ------- ------- -------
Distributions
From net investment income (.05) -- -- (.06) -- (.03)
------- ------- ------- ------- ------- -------
Total distributions (.05) -- -- (.06) -- (.03)
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $6.56 $4.17 $4.38 $4.92 $6.11 $5.58
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding accounts fees) (a) 58.55% (4.79)% (10.98)% (18.45)% 9.50% 37.50%
Ratios to Average Net Assets (b):
Net investment loss (.59)% (.60)% (.83)% (.56)% (.40)% (1.18)%
Total expenses 2.25% 3.91% 3.54% 3.04% 3.10% 4.41%
Expenses reimbursed or offset -- -- -- -- -- --
Net expenses 2.25% 3.91% 3.54% 3.04% 3.10% 4.41%
Portfolio turnover rate 25% 44% 29% 4% 40% 13%
Net assets, end of period (in thousands) $53,543 $12,815 $12,003 $15,123 $21,273 $29,156
<FN>
(a)Total returns for periods less than one year are not annualized.
Assumes investment at the net asset value at the beginning of the
period, reinvestment of all distributions and a complete
redemption of the investment at the net asset value at the end of
the period.
(b)Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as
discussed in the notes to the financial statements. These amounts
would decrease the net investment income ratio had such
reductions not occurred.
See accompanying notes to financial statements.
</FN>
117
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -----------------------------------------------------------------------------
GLOBAL RESOURCES FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $5.14 $4.93 $4.01 $3.88 $4.01 $4.47
- ----------------------------------------------------------------------------------------------------
Investment Activities
Net investment income (loss) .15 (.05) (.06) (.06) (.08) (.07)
Net realized and unrealized gain
(loss) 3.39 .35 .98 .19 (.05) (.15)
-------- ------- ------- ------- ------- -------
Total from investment activities 3.54 .30 .92 .13 (.13) (.22)
-------- ------- ------- ------- ------- -------
Distributions
From net investment income (.13) (.09) -- -- -- --
From net realized gains -- -- -- -- -- (.24)
-------- ------- ------- ------- ------- -------
Total distributions (.13) (.09) -- -- -- (.24)
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $8.55 $5.14 $4.93 $4.01 $3.88 $4.01
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (a) 68.89% 6.43% 22.94% 3.35% (3.24)% (4.12)%
Ratios to Average Net Assets (b):
Net investment income (loss) .68% (1.38)% (1.57)% (1.47)% (1.87)% (1.83)%
Total expenses 1.55% 3.75% 3.83% 3.61% 3.79% 4.34%
Expenses reimbursed or offset -- -- -- -- -- --
Net expenses 1.55% 3.75% 3.83% 3.61% 3.79% 4.34%
Portfolio turnover rate 6% 101% 96% 65% 55% 153%
Net assets, end of period (in
thousands) $215,337 $14,884 $14,900 $11,887 $13,530 $16,964
WORLD PRECIOUS MINERALS FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $9.75 $10.43 $5.28 $6.43 $7.79 $9.86
- -----------------------------------------------------------------------------------------------------
Investment Activities
Net investment income (loss) .29 (.05) (.07) (.10) (.01) .02
Net realized and unrealized gain
(loss) 8.48 (.38) 5.22 (1.03) (1.35) (2.08)
-------- -------- ------- ------- ------- --------
Total from investment activities 8.77 (.43) 5.15 (1.13) (1.36) (2.06)
-------- -------- ------- ------- ------- --------
Distributions
From net investment income (1.86) (.25) -- (.02) -- (.01)
-------- -------- ------- ------- ------- --------
Total distributions (1.86) (.25) -- (.02) -- (.01)
- -----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $16.66 $9.75 $10.43 $5.28 $6.43 $7.79
- -----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (a) 91.71% (4.02)% 97.54% (17.54)% (17.46)% (20.89)%
Ratios to Average Net Assets (b):
Net investment income (loss) (1.04)% (1.36)% (1.32)% (1.51)% (1.41)% .27%
Total expenses 1.40% 1.92% 2.27% 2.86% 2.50% 2.18%
Expenses reimbursed or offset -- -- -- -- -- (.06)%
Net expenses 1.40% 1.92% 2.27% 2.86% 2.50% 2.12%
Portfolio turnover rate 49% 141% 104% 68% 93% 252%
Net assets, end of period (in
thousands) $288,421 $107,212 $97,044 $42,455 $57,019 $96,057
<FN>
(a)Total returns for periods less than one year are not annualized.
Assumes investment at the net asset value at the beginning of the
period, reinvestment of all distributions and a complete
redemption of the investment at the net asset value at the end of
the period.
(b)Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as
discussed in the notes to the financial statements. These amounts
would decrease the net investment income ratio had such
reductions not occurred.
See accompanying notes to financial statements.
</FN>
118
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- -----------------------------------------------------------------------------
GOLD SHARES FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2003
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/03 2003 2002 2001 2000 1999
NET ASSET VALUE, BEGINNING OF PERIOD $5.18 $5.28 $2.83 $2.92 $3.42 $3.79
- -----------------------------------------------------------------------------------------------------
Investment Activities
Net investment loss (.04) (.10) (.06) (.09) (.15) (.11)
Net realized and unrealized gain (loss) 3.65 -- 2.51 -- (.35) (.26)
------- ------- ------- ------- ------- -------
Total from investment activities 3.61 (.10) 2.45 (.09) (.50) (.37)
------- ------- ------- ------- ------- -------
Distributions
From net investment income (.03) -- -- -- -- --
------- ------- ------- ------- ------- -------
Total distributions (.03) -- -- -- -- --
- -----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $8.76 $5.18 $5.28 $2.83 $2.92 $3.42
- -----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding accounts fees) (a) 69.66% (1.89)% 86.57% (3.08)% (14.62)% (9.76)%
Ratios to Average Net Assets (b):
Net investment loss (1.37)% (1.98)% (1.99)% (2.93)% (3.98)% (2.88)%
Total expenses 1.95% 2.64% 3.57% 5.79% 5.74% 5.59%
Expenses reimbursed or offset -- -- -- -- -- (.35)%
Net expenses 1.95% 2.64% 3.57% 5.79% 5.74% 5.24%
Portfolio turnover rate 47% 138% 164% 95% 82% 388%
Net assets, end of period (in thousands) $86,047 $45,720 $52,911 $22,231 $25,836 $38,286
<FN>
(a)Total returns for periods less than one year are not annualized.
Assumes investment at the net asset value at the beginning of the
period, reinvestment of all distributions and a complete
redemption of the investment at the net asset value at the end of
the period.
(b)Ratios are annualized for periods of less than one year. Expenses
reimbursed or offset reflect reductions to total expenses, as
discussed in the notes to the financial statements. These amounts
would decrease the net investment income ratio had such
reductions not occurred.
See accompanying notes to financial statements.
</FN>
119
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ITEM 2. CODE OF ETHICS.
Required only in annual report on Form N-CSR.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Required only in annual report on Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Required only in annual report on Form N-CSR.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Required only in annual report on Form N-CSR.
ITEM 6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) The registrant"s president and treasurer have determined 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 date of this report.
(b) There was no change in the registrant's internal control over financial
reporting that occurred in the registrant's first fiscal half-year that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 10. EXHIBITS.
(a) Not applicable.
(b) Certifications of principal executive officer and principal financial
officer of the registrant as required by Rule 30a-2 under the Investment
Company Act of 1940.
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.
U.S. GLOBAL INVESTORS FUNDS
By: /s/Frank E. Holmes
------------------
Frank E. Holmes
President, Chief Executive Officer
Date: March 10, 2004
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/Frank E. Holmes
------------------
Frank E. Holmes
President, Chief Executive Officer
Date: March 10, 2004
By: /s/Tracy C. Peterson
--------------------
Tracy C. Peterson
Treasurer
Date: March 10, 2004
EXHIBIT INDEX
(b) (1) Certifications of principal executive officer and principal
financial officer as required by Rule 30a-2 under the Investment
Company Act of 1940.
(b) (2) Certifications of principal executive officer and principal
financial officer as required by Section 906 of the Sarbanes-Oxley Act
of 2002.