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, 2006
Date of reporting period: DECEMBER 31, 2005
ITEM 1. REPORTS TO STOCKHOLDERS.
U.S. GLOBAL INVESTORS FUNDS
SEMI-ANNUAL REPORT
DECEMBER 31, 2005
(UNAUDITED)
TABLE OF CONTENTS
LETTER TO SHAREHOLDERS 1
MANAGEMENT TEAMS' PERSPECTIVES 6
EXPENSE EXAMPLE 40
PORTFOLIOS OF INVESTMENTS 42
NOTES TO PORTFOLIOS OF INVESTMENTS 86
STATEMENTS OF ASSETS AND LIABILITIES 90
STATEMENTS OF OPERATIONS 94
STATEMENTS OF CHANGES IN NET ASSETS 98
NOTES TO FINANCIAL STATEMENTS 104
FINANCIAL HIGHLIGHTS 115
ADDITIONAL INFORMATION 120
NASDAQ SYMBOLS
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
U.S. GLOBAL INVESTORS FUNDS
DEAR SHAREHOLDER
As we complete the first six months of the fiscal
year for the U.S. Global Investors Funds series,
we are pleased with the performance of our funds.
All nine of the Investors Funds finished 2005 in [PHOTO]
positive territory with all five equity funds
having impressive double-digit returns, especially
the gold and natural resources funds, and we have
several category leaders.
MORNINGSTAR LISTED THE GLOBAL RESOURCES FUND (PSPFX) #1 FOR ALL
FUNDS FOR THE THREE-YEAR AND FIVE-YEAR PERIODS.
Morningstar recognized the Global Resources Fund (PSPFX) for its top
performance as of year-end. The Global Resources Fund is ranked #1
out of 10,366 domestic stock funds for the three-year total
annualized return and #1 out of 8,905 domestic stock funds for the
five-year total annualized return as of December 31, 2005.
LIPPER RANKED THREE U.S. GLOBAL INVESTORS FUNDS #1 IN THEIR
CATEGORIES.
The Global Resources Fund (PSPFX) ranked #1 in the Natural Resource
Funds Category, and the World Precious Minerals Fund (UNWPX) ranked
#1 in the Gold Oriented Funds Category for the three- and five-year
time periods. In addition, Lipper ranked the China Region
Opportunity Fund (USCOX) as #1 in the China Region Funds Category
for the one- and three-year time periods. All rankings are for the
time period ending December 31, 2005.
ONE OF THE MOST POWERFUL HISTORICAL INTERRELATIONSHIP SYSTEMS IS
BETWEEN OIL AND GOLD.
We are in a great secular bull market for commodities, and gold is
of particular importance because of its relationship to oil. Oil
exporting countries, such as Russia and Saudi Arabia, have the
potential to earn over $700 billion from selling oil. Many of those
petro-dollars have been diversified into gold as an asset class. In
November 2005, the Russian government announced that its gold
reserves as a portion of its overall reserves may be doubled in
2006, increasing from 5 to 10 percent. Russia already has 500 tons
of gold in reserve, and doubling its reserve in gold would consume
annual gold output for approximately three years. This announcement
helped the price of gold rapidly move to over $500 an ounce. With
the global economy continuing to grow rapidly, the demand for gold,
oil and precious metals is now exceeding the supply and is projected
to continue to grow well beyond 2006.
1
U.S. GLOBAL INVESTORS FUNDS
These drivers have helped the Global Resources Fund (PSPFX), World
Precious Minerals Fund (UNWPX) and Gold Shares Fund (USERX) deliver
impressive annualized total returns from 30 to nearly 50 percent, as
of December 31, 2005.
[Performance Chart]
- -------------------------------------------------------------------------------------
* Annualized Total Return
Ticker One-Year Three-Year Total Five-Year Ten-Year
Symbol Total Return Return* Total Return* Total Return*
PSPFX 48.97% 57.03% 31.59% 14.89%
UNWPX 30.89% 36.52% 38.07% 4.88%
USERX 32.80% 27.54% 33.12% (4.84%)
Performance data quoted above is historical. Past performance is no guarantee
of future results. Current performance may be higher or lower than the
performance data quoted. The principal value and investment return of an
investment will fluctuate so that your shares, when redeemed, may be worth
more or less than their original cost. Obtain performance data current to
the most recent month-end at www.usfunds.com or 1-800-US-FUNDS, option 5.
Please keep in mind that high double-digit returns are highly unusual and
cannot be sustained. Recent returns were achieved during favorable market
conditions, especially within the natural resources and gold sectors.
- -------------------------------------------------------------------------------
While some periods have been volatile at times, we believe that the
gold and natural resource markets will continue to offer investors
exceptional investment opportunities. However, we always like to
remind investors that according to Roger Gibson's best-selling book,
"Asset Allocation. Balancing Financial Risk," it is important to
diversify between different asset classes. Mr. Gibson recommends
that investors should consider allocating equally between the four
major asset classes including fixed income, domestic equities,
global equities and hard assets (commodities, real estate, precious
minerals, etc.). Investors should limit their hard assets exposure
to 25 percent of their portfolio in natural resource stocks and
mutual funds and rebalance every year. In addition, Mr. Gibson
recommends that investors should also maintain 25 percent of their
portfolio in international stocks and mutual funds.
We are still bullish on the China region because of government
policies for peace and prosperity. China is spending much of its
resources on its infrastructure, much of it being directed to the
rural areas, highways and ports. Technology is also fairly bullish
in this region, a driver that is particularly good for both Taiwan
and Korea since their economies are concentrated in electronics. The
PC replacement cycle is a catalyst that we think will positively
affect the China region. Microsoft's new operating system, Vista,
may cause an increase among consumers and businesses to upgrade
their computers, requiring newer parts. Apple is beginning to use
the flash memory that Intel and Micron (a China region-based
provider of advanced semiconductor solutions) are working
cooperatively to create. These are good indicators that the demand
for technology is probably somewhat sustainable.
2
U.S. GLOBAL INVESTORS FUNDS
As you already know, high double digit returns are not always what
the markets deliver, so it is important that we circle back and
remind investors of an important investment cycle and a few
strategies that we have talked about in the past.
It is also important we revisit how markets perform differently
during certain years of a Presidential election cycle. Historically,
the first two years of a Presidential cycle (which we are in) tend
to be the roughest due to the President pushing his toughest or most
controversial policies early in his term. Stimulating policies are
usually saved for the third and fourth years of a term to help the
President gain approval for the upcoming elections. The chart below
shows how George W. Bush's second term in office and the past
performance of the S&P 500 during the last 13 Presidential cycles
correspond almost identically. Notice that prior to the 24th month,
the market again starts to rally.
PRESIDENTIAL CYCLE ON CYCLE COMPARISON
S&P 500 Monthly Closing Price, Through =100
[Presidential Cycle on Cycle Comparison Graph]
Month Value Month# Normalized value Month # Value GW Bush
(in cycle) S&P Index Value
31-Jan-06 1280.08 1 108.3647
30-Dec-05 1,248.29 12 105.6736 48 136.4888
30-Nov-05 1249.48 11 105.7743 47 135.3369
31-Oct-05 1207.01 10 102.179 46 133.4098
30-Sep-05 1228.81 9 104.0245 45 132.4815
31-Aug-05 1220.33 8 103.3066 44 132.3413
31-Jul-05 1231.23 7 104.2293 43 131.1343
30-Jun-05 1191.33 6 100.8516 42 130.8638
31-May-05 1191.5 5 100.866 41 128.6756
2-May-05 1198.78 5 101.4823 40 129.2244
1-Apr-05 1156.85 4 97.93273 39 128.3805
1-Mar-05 1180.59 3 99.94243 38 127.2166
1-Feb-05 1203.6 2 101.8903 37 126.6793
3-Jan-05 1181.27 1 100 36 126.8812
1-Dec-04 1211.92 12 88.7197 35 122.4237
1-Nov-04 1173.82 11 85.93056 34 121.4518
1-Oct-04 1130.2 10 82.73732 33 124.2562
1-Sep-04 1114.58 9 81.59384 32 125.1559
2-Aug-04 1104.24 8 80.83689 31 123.7268
1-Jul-04 1101.72 7 80.65241 30 122.1418
1-Jun-04 1140.84 6 83.51623 29 119.4683
3-May-04 1120.68 5 82.0404 28 119.2493
1-Apr-04 1107.3 4 81.0609 27 115.5354
1-Mar-04 1126.21 3 82.44522 26 112.6319
2-Feb-04 1144.94 2 83.81637 25 111.6695
2-Jan-04 1131.13 1 82.8054 24 106.7919
1-Dec-03 1111.92 12 81.39911 23 104.8595
3-Nov-03 1058.2 11 77.46649 22 101.3989
1-Oct-03 1050.71 10 76.91818 21 98.47699
2-Sep-03 995.97 9 72.91089 20 99.70706
1-Aug-03 1008.01 8 73.79229 19 101.1586
1-Jul-03 990.31 7 72.49654 18 100.8077
2-Jun-03 974.5 6 71.33916 17 102.1378
1-May-03 963.59 5 70.54048 16 102.4944
1-Apr-03 916.92 4 67.12396 15 102.8664
3-Mar-03 848.18 3 62.09179 14 101.5782 108.3647
3-Feb-03 841.15 2 61.57715 13 100.9828 105.6736
2-Jan-03 855.7 1 62.64229 12 102.1685 105.7743
2-Dec-02 879.82 12 64.40802 11 101.7056 102.179
1-Nov-02 936.31 11 68.54342 10 100.4451 104.0245
1-Oct-02 885.76 10 64.84286 9 99.53432 103.3066
3-Sep-02 815.28 9 59.68331 8 100.7208 104.2293
1-Aug-02 916.07 8 67.06173 7 102.5551 100.8516
1-Jul-02 911.62 7 66.73597 6 100.9249 100.866
3-Jun-02 989.82 6 72.46067 5 101.6825 101.4823
1-May-02 1067.14 5 78.12095 4 100.2676 97.93273
1-Apr-02 1076.92 4 78.8369 3 99.11031 99.94243
1-Mar-02 1147.39 3 83.99572 2 99.12434 101.8903
1-Feb-02 1106.73 2 81.01917 1 100 100
2-Jan-02 1130.2 1 82.73732
3-Dec-01 1148.08 12 84.04624
1-Nov-01 1139.45 11 83.41447
1-Oct-01 1059.78 10 77.58216
4-Sep-01 1040.94 9 76.20296
1-Aug-01 1133.58 8 82.98475
2-Jul-01 1211.23 7 88.66919
1-Jun-01 1224.38 6 89.63185
1-May-01 1255.82 5 91.93344
2-Apr-01 1249.46 4 91.46785
1-Mar-01 1160.33 3 84.94301
1-Feb-01 1239.94 2 90.77093
2-Jan-01 1366.01 1 100
1-Dec-00 1320.28 12 167.9404
1-Nov-00 1314.95 11 167.2624
2-Oct-00 1429.4 10 181.8205
1-Sep-00 1436.51 9 182.7249
1-Aug-00 1517.68 8 193.0498
3-Jul-00 1430.83 7 182.0024
1-Jun-00 1454.6 6 185.0259
1-May-00 1420.6 5 180.7011
3-Apr-00 1452.43 4 184.7499
1-Mar-00 1498.58 3 190.6202
1-Feb-00 1366.42 2 173.8094
3-Jan-00 1394.46 1 177.3761
1-Dec-99 1469.25 12 186.8894
1-Nov-99 1388.91 11 176.6701
1-Oct-99 1362.93 10 173.3655
1-Sep-99 1282.71 9 163.1614
2-Aug-99 1320.41 8 167.9569
1-Jul-99 1328.72 7 169.0139
1-Jun-99 1372.71 6 174.6095
3-May-99 1301.84 5 165.5948
1-Apr-99 1335.18 4 169.8357
1-Mar-99 1286.37 3 163.627
1-Feb-99 1238.33 2 157.5163
4-Jan-99 1279.64 1 162.7709
1-Dec-98 1229.23 12 156.3588
2-Nov-98 1163.63 11 148.0144
1-Oct-98 1098.67 10 139.7515
1-Sep-98 1017.01 9 129.3643
3-Aug-98 957.28 8 121.7666
1-Jul-98 1120.67 7 142.5499
1-Jun-98 1133.84 6 144.2251
1-May-98 1090.82 5 138.7529
1-Apr-98 1111.75 4 141.4152
2-Mar-98 1101.75 3 140.1432
2-Feb-98 1049.34 2 133.4766
2-Jan-98 980.28 1 124.6922
1-Dec-97 970.43 12 123.4392
3-Nov-97 955.4 11 121.5274
1-Oct-97 914.62 10 116.3402
2-Sep-97 947.28 9 120.4946
1-Aug-97 899.47 8 114.4131
1-Jul-97 954.31 7 121.3888
2-Jun-97 885.14 6 112.5903
1-May-97 848.28 5 107.9017
1-Apr-97 801.34 4 101.9309
3-Mar-97 757.12 3 96.3061
3-Feb-97 790.82 2 100.5928
2-Jan-97 786.16 1 100
2-Dec-96 740.74 12 168.8181
1-Nov-96 757.02 11 172.5284
1-Oct-96 705.27 10 160.7343
3-Sep-96 687.33 9 156.6457
1-Aug-96 651.99 8 148.5915
1-Jul-96 639.95 7 145.8476
3-Jun-96 670.63 6 152.8397
1-May-96 669.12 5 152.4956
1-Apr-96 654.17 4 149.0884
1-Mar-96 645.5 3 147.1124
1-Feb-96 640.43 2 145.957
2-Jan-96 636.02 1 144.9519
1-Dec-95 615.93 12 140.3733
1-Nov-95 605.37 11 137.9666
2-Oct-95 581.5 10 132.5266
1-Sep-95 584.41 9 133.1898
1-Aug-95 561.88 8 128.0551
3-Jul-95 562.06 7 128.0961
1-Jun-95 544.75 6 124.1511
1-May-95 533.4 5 121.5643
3-Apr-95 514.71 4 117.3048
1-Mar-95 500.71 3 114.1141
1-Feb-95 487.39 2 111.0784
3-Jan-95 470.42 1 107.2109
1-Dec-94 459.27 12 104.6698
1-Nov-94 453.69 11 103.3981
3-Oct-94 472.35 10 107.6508
1-Sep-94 462.71 9 105.4538
1-Aug-94 475.49 8 108.3664
1-Jul-94 458.26 7 104.4396
1-Jun-94 444.27 6 101.2512
2-May-94 456.5 5 104.0385
4-Apr-94 450.91 4 102.7645
1-Mar-94 445.77 3 101.5931
1-Feb-94 467.14 2 106.4634
3-Jan-94 481.61 1 109.7612
1-Dec-93 466.45 12 106.3061
1-Nov-93 461.79 11 105.2441
1-Oct-93 467.83 10 106.6206
1-Sep-93 458.93 9 104.5923
2-Aug-93 463.56 8 105.6475
1-Jul-93 448.13 7 102.1309
1-Jun-93 450.53 6 102.6779
3-May-93 450.19 5 102.6004
1-Apr-93 440.19 4 100.3213
1-Mar-93 451.67 3 102.9377
1-Feb-93 443.38 2 101.0484
4-Jan-93 438.78 1 100
1-Dec-92 435.71 12 158.9718
2-Nov-92 431.35 11 157.3811
1-Oct-92 418.68 10 152.7583
1-Sep-92 417.8 9 152.4372
3-Aug-92 414.03 8 151.0617
1-Jul-92 424.21 7 154.776
1-Jun-92 408.14 6 148.9127
1-May-92 415.35 5 151.5433
1-Apr-92 414.95 4 151.3974
2-Mar-92 403.69 3 147.2891
3-Feb-92 412.7 2 150.5765
2-Jan-92 408.78 1 149.1462
2-Dec-91 417.09 12 152.1782
1-Nov-91 375.22 11 136.9016
1-Oct-91 392.45 10 143.1881
3-Sep-91 387.86 9 141.5134
1-Aug-91 395.43 8 144.2754
1-Jul-91 387.81 7 141.4952
3-Jun-91 371.16 6 135.4203
1-May-91 389.83 5 142.2322
1-Apr-91 375.34 4 136.9454
1-Mar-91 375.22 3 136.9016
1-Feb-91 367.07 2 133.9281
2-Jan-91 343.93 1 125.4853
3-Dec-90 330.22 12 120.4831
1-Nov-90 322.22 11 117.5642
1-Oct-90 304 10 110.9165
4-Sep-90 306.05 9 111.6645
1-Aug-90 322.56 8 117.6883
2-Jul-90 356.15 7 129.9438
1-Jun-90 358.02 6 130.6261
1-May-90 361.23 5 131.7973
2-Apr-90 330.8 4 120.6947
1-Mar-90 339.94 3 124.0295
1-Feb-90 331.89 2 121.0924
2-Jan-90 329.08 1 120.0671
1-Dec-89 353.4 12 128.9405
1-Nov-89 345.99 11 126.2369
2-Oct-89 340.36 10 124.1827
1-Sep-89 349.15 9 127.3898
1-Aug-89 351.45 8 128.229
3-Jul-89 346.08 7 126.2697
1-Jun-89 317.98 6 116.0172
1-May-89 320.52 5 116.944
3-Apr-89 309.64 4 112.9743
1-Mar-89 294.87 3 107.5854
1-Feb-89 288.86 2 105.3926
3-Jan-89 297.47 1 100
1-Dec-88 277.72 12 154.6067
1-Nov-88 273.7 11 152.3688
3-Oct-88 278.97 10 155.3026
1-Sep-88 271.91 9 151.3723
1-Aug-88 261.52 8 145.5882
1-Jul-88 272.02 7 151.4335
1-Jun-88 273.5 6 152.2574
2-May-88 262.16 5 145.9444
4-Apr-88 261.33 4 145.4824
1-Mar-88 258.89 3 144.124
1-Feb-88 267.82 2 149.0954
4-Jan-88 257.07 1 143.1108
1-Dec-87 247.08 12 137.5494
2-Nov-87 230.3 11 128.208
1-Oct-87 251.79 10 140.1715
1-Sep-87 321.83 9 179.1627
3-Aug-87 329.8 8 183.5996
1-Jul-87 318.66 7 177.398
1-Jun-87 304 6 169.2368
1-May-87 290.1 5 161.4986
1-Apr-87 288.36 4 160.53
2-Mar-87 291.7 3 162.3894
2-Feb-87 284.2 2 158.2141
2-Jan-87 274.08 1 152.5803
1-Dec-86 242.17 12 134.816
3-Nov-86 249.22 11 138.7407
1-Oct-86 243.98 10 135.8236
2-Sep-86 231.32 9 128.7758
1-Aug-86 252.93 8 140.8061
1-Jul-86 236.12 7 131.448
2-Jun-86 250.84 6 139.6426
1-May-86 247.35 5 137.6997
1-Apr-86 235.52 4 131.114
3-Mar-86 238.9 3 132.9956
3-Feb-86 226.92 2 126.3263
2-Jan-86 211.78 1 117.8979
2-Dec-85 211.28 12 117.6196
1-Nov-85 202.17 11 112.548
1-Oct-85 189.82 10 105.6728
3-Sep-85 182.08 9 101.3639
1-Aug-85 188.63 8 105.0103
1-Jul-85 190.92 7 106.2851
3-Jun-85 191.85 6 106.8029
1-May-85 189.55 5 105.5225
1-Apr-85 179.83 4 100.1113
1-Mar-85 180.66 3 100.5734
1-Feb-85 181.18 2 100.8629
2-Jan-85 179.63 1 100
3-Dec-84 167.24 12 129.093
1-Nov-84 163.58 11 126.2679
1-Oct-84 166.09 10 128.2053
4-Sep-84 166.1 9 128.213
1-Aug-84 166.68 8 128.6607
2-Jul-84 150.66 7 116.2949
1-Jun-84 153.18 6 118.2401
1-May-84 150.55 5 116.21
2-Apr-84 160.05 4 123.543
1-Mar-84 159.18 3 122.8715
1-Feb-84 157.06 2 121.235
3-Jan-84 163.41 1 126.1366
1-Dec-83 164.93 12 127.3099
1-Nov-83 166.4 11 128.4446
3-Oct-83 163.55 10 126.2447
1-Sep-83 166.07 9 128.1899
1-Aug-83 164.4 8 126.9008
1-Jul-83 162.56 7 125.4805
1-Jun-83 167.64 6 129.4018
2-May-83 162.39 5 125.3493
4-Apr-83 164.43 4 126.924
1-Mar-83 152.96 3 118.0702
1-Feb-83 148.06 2 114.2879
3-Jan-83 145.3 1 112.1575
1-Dec-82 140.64 12 108.5604
1-Nov-82 138.53 11 106.9317
1-Oct-82 133.72 10 103.2188
1-Sep-82 120.42 9 92.95253
2-Aug-82 119.51 8 92.2501
1-Jul-82 107.09 7 82.66306
1-Jun-82 109.61 6 84.60826
3-May-82 111.88 5 86.36048
1-Apr-82 116.44 4 89.88036
1-Mar-82 111.96 3 86.42223
1-Feb-82 113.11 2 87.30992
4-Jan-82 120.4 1 92.93709
1-Dec-81 122.55 12 94.59668
2-Nov-81 126.35 11 97.52991
1-Oct-81 121.89 10 94.08723
1-Sep-81 116.18 9 89.67966
3-Aug-81 122.79 8 94.78194
1-Jul-81 130.92 7 101.0575
1-Jun-81 131.21 6 101.2814
1-May-81 132.59 5 102.3466
1-Apr-81 132.81 4 102.5164
2-Mar-81 136 3 104.9788
2-Feb-81 131.27 2 101.3277
2-Jan-81 129.55 1 100
1-Dec-80 135.76 12 133.0589
3-Nov-80 140.52 11 137.7242
1-Oct-80 127.47 10 124.9338
2-Sep-80 125.46 9 122.9638
1-Aug-80 122.38 8 119.9451
1-Jul-80 121.67 7 119.2492
2-Jun-80 114.24 6 111.9671
1-May-80 111.24 5 109.0268
1-Apr-80 106.29 4 104.1752
3-Mar-80 102.09 3 100.0588
1-Feb-80 113.66 2 111.3986
2-Jan-80 114.16 1 111.8887
3-Dec-79 107.94 12 105.7924
1-Nov-79 106.16 11 104.0478
1-Oct-79 101.82 10 99.79418
4-Sep-79 109.32 9 107.145
1-Aug-79 109.32 8 107.145
2-Jul-79 103.81 7 101.7446
1-Jun-79 102.91 6 100.8625
1-May-79 99.08 5 97.10869
2-Apr-79 101.76 4 99.73537
1-Mar-79 101.59 3 99.56875
1-Feb-79 96.28 2 94.3644
2-Jan-79 99.93 1 97.94178
1-Dec-78 96.11 12 94.19778
1-Nov-78 94.7 11 92.81584
2-Oct-78 93.15 10 91.29668
1-Sep-78 102.54 9 100.4999
1-Aug-78 103.29 8 101.2349
3-Jul-78 100.68 7 98.67686
1-Jun-78 95.53 6 93.62932
1-May-78 97.24 5 95.3053
3-Apr-78 96.83 4 94.90346
1-Mar-78 89.21 3 87.43507
1-Feb-78 87.04 2 85.30824
3-Jan-78 89.25 1 87.47427
1-Dec-77 95.1 12 93.20788
1-Nov-77 94.83 11 92.94325
3-Oct-77 92.34 10 90.50279
1-Sep-77 96.53 9 94.60943
1-Aug-77 96.77 8 94.84465
1-Jul-77 98.85 7 96.88327
1-Jun-77 100.48 6 98.48084
2-May-77 96.12 5 94.20759
1-Apr-77 98.44 4 96.48143
1-Mar-77 98.42 3 96.46182
1-Feb-77 99.82 2 97.83397
3-Jan-77 102.03 1 100
1-Dec-76 107.46 12 92.61398
1-Nov-76 102.1 11 87.99448
1-Oct-76 102.9 10 88.68396
1-Sep-76 105.24 9 90.70068
2-Aug-76 102.91 8 88.69258
1-Jul-76 103.44 7 89.14936
1-Jun-76 104.28 6 89.87331
3-May-76 100.18 5 86.33974
1-Apr-76 101.64 4 87.59803
1-Mar-76 102.77 3 88.57192
2-Feb-76 99.71 2 85.93467
2-Jan-76 100.86 1 86.9258
1-Dec-75 90.19 12 77.7299
3-Nov-75 91.24 11 78.63484
1-Oct-75 89.04 10 76.73877
2-Sep-75 83.87 9 72.28303
1-Aug-75 86.88 8 74.87719
1-Jul-75 88.75 7 76.48884
2-Jun-75 95.19 6 82.03913
1-May-75 91.15 5 78.55727
1-Apr-75 87.3 4 75.23916
3-Mar-75 83.36 3 71.84349
3-Feb-75 81.59 2 70.31802
2-Jan-75 76.98 1 66.34491
2-Dec-74 68.56 12 59.08817
1-Nov-74 69.97 11 60.30337
1-Oct-74 73.9 10 63.69042
3-Sep-74 63.54 9 54.7617
1-Aug-74 72.15 8 62.18219
1-Jul-74 79.31 7 68.35301
3-Jun-74 86 6 74.11876
1-May-74 87.28 5 75.22193
1-Apr-74 90.31 4 77.83332
1-Mar-74 93.98 3 80.99629
1-Feb-74 96.22 2 82.92683
2-Jan-74 96.57 1 83.22848
3-Dec-73 97.55 12 84.07308
1-Nov-73 95.96 11 82.70275
1-Oct-73 108.29 10 93.32931
4-Sep-73 108.43 9 93.44997
1-Aug-73 104.25 8 89.84745
2-Jul-73 108.22 7 93.26898
1-Jun-73 104.26 6 89.85607
1-May-73 104.95 5 90.45075
2-Apr-73 106.97 4 92.19167
1-Mar-73 111.52 3 96.11307
1-Feb-73 111.68 2 96.25097
2-Jan-73 116.03 1 100
1-Dec-72 118.05 12 114.6005
1-Nov-72 116.67 11 113.2608
2-Oct-72 111.58 10 108.3196
1-Sep-72 110.55 9 107.3197
1-Aug-72 111.09 8 107.8439
3-Jul-72 107.39 7 104.252
1-Jun-72 107.14 6 104.0093
1-May-72 109.53 5 106.3295
3-Apr-72 107.67 4 104.5238
1-Mar-72 107.2 3 104.0676
1-Feb-72 106.57 2 103.456
3-Jan-72 103.94 1 100.9028
1-Dec-71 102.09 12 99.10688
1-Nov-71 93.99 11 91.24357
1-Oct-71 94.23 10 91.47656
1-Sep-71 98.34 9 95.46646
2-Aug-71 99.03 8 96.1363
1-Jul-71 95.58 7 92.78711
1-Jun-71 98.7 6 95.81594
3-May-71 99.63 5 96.71877
1-Apr-71 103.95 4 100.9125
1-Mar-71 100.31 3 97.3789
1-Feb-71 96.75 2 93.92292
4-Jan-71 95.88 1 93.07834
1-Dec-70 92.15 12 89.45733
2-Nov-70 87.2 11 84.65198
1-Oct-70 83.25 10 80.8174
1-Sep-70 84.3 9 81.83671
3-Aug-70 81.52 8 79.13795
1-Jul-70 78.05 7 75.76934
1-Jun-70 72.72 6 70.59509
1-May-70 76.55 5 74.31317
1-Apr-70 81.52 4 79.13795
2-Mar-70 89.63 3 87.01097
2-Feb-70 89.5 2 86.88477
2-Jan-70 85.02 1 82.53568
1-Dec-69 92.06 12 89.36996
3-Nov-69 93.81 11 91.06883
1-Oct-69 97.12 10 94.28211
2-Sep-69 93.12 9 90.39899
1-Aug-69 95.51 8 92.71915
1-Jul-69 91.83 7 89.14668
2-Jun-69 97.71 6 94.85487
1-May-69 103.46 5 100.4369
1-Apr-69 103.69 4 100.6601
3-Mar-69 101.51 3 98.54383
3-Feb-69 98.13 2 95.2626
2-Jan-69 103.01 1 100
2-Dec-68 103.86 12 118.6158
1-Nov-68 108.37 11 123.7666
1-Oct-68 103.41 10 118.1019
3-Sep-68 102.67 9 117.2567
1-Aug-68 98.86 8 112.9054
1-Jul-68 97.74 7 111.6263
3-Jun-68 99.58 6 113.7277
1-May-68 98.68 5 112.6999
1-Apr-68 97.46 4 111.3065
1-Mar-68 90.2 3 103.0151
1-Feb-68 89.36 2 102.0557
2-Jan-68 92.24 1 105.3449
1-Dec-67 96.47 12 110.1759
1-Nov-67 94 11 107.355
2-Oct-67 93.3 10 106.5555
1-Sep-67 96.71 9 110.45
1-Aug-67 93.64 8 106.9438
3-Jul-67 94.75 7 108.2115
1-Jun-67 90.64 6 103.5176
1-May-67 89.08 5 101.736
3-Apr-67 94.01 4 107.3664
1-Mar-67 90.2 3 103.0151
1-Feb-67 86.78 2 99.10918
3-Jan-67 86.61 1 98.91503
1-Dec-66 80.33 12 91.7428
1-Nov-66 80.45 11 91.87985
3-Oct-66 80.2 10 91.59434
1-Sep-66 76.56 9 87.43719
1-Aug-66 77.1 8 88.05391
1-Jul-66 83.6 7 95.47739
1-Jun-66 84.74 6 96.77935
2-May-66 86.13 5 98.36683
1-Apr-66 91.06 4 103.9973
1-Mar-66 89.23 3 101.9073
1-Feb-66 91.22 2 104.18
3-Jan-66 92.88 1 106.0758
1-Dec-65 92.43 12 105.5619
1-Nov-65 91.61 11 104.6254
1-Oct-65 92.42 10 105.5505
1-Sep-65 89.96 9 102.741
2-Aug-65 87.17 8 99.55459
1-Jul-65 85.25 7 97.36181
1-Jun-65 84.12 6 96.07127
3-May-65 88.42 5 100.9822
1-Apr-65 89.11 4 101.7702
1-Mar-65 86.16 3 98.4011
1-Feb-65 87.43 2 99.85153
4-Jan-65 87.56 1 100
1-Dec-64 84.75 12 137.1803
2-Nov-64 84.42 11 136.6462
1-Oct-64 84.86 10 137.3584
1-Sep-64 84.18 9 136.2577
3-Aug-64 81.83 8 132.4539
1-Jul-64 83.18 7 134.639
1-Jun-64 81.69 6 132.2273
1-May-64 80.37 5 130.0906
1-Apr-64 79.46 4 128.6177
2-Mar-64 78.98 3 127.8407
3-Feb-64 77.8 2 125.9307
2-Jan-64 77.04 1 124.7006
2-Dec-63 75.02 12 121.4309
1-Nov-63 73.23 11 118.5335
1-Oct-63 74.01 10 119.7961
3-Sep-63 71.7 9 116.057
1-Aug-63 72.5 8 117.3519
1-Jul-63 69.13 7 111.8971
3-Jun-63 69.37 6 112.2855
1-May-63 70.8 5 114.6002
1-Apr-63 69.8 4 112.9815
1-Mar-63 66.57 3 107.7533
1-Feb-63 64.29 2 104.0628
2-Jan-63 66.2 1 107.1544
3-Dec-62 63.1 12 102.1366
1-Nov-62 62.26 11 100.777
1-Oct-62 56.52 10 91.48592
4-Sep-62 56.27 9 91.08126
1-Aug-62 59.12 8 95.6944
2-Jul-62 58.23 7 94.2538
1-Jun-62 54.75 6 88.62091
1-May-62 59.63 5 96.51991
2-Apr-62 65.24 4 105.6005
1-Mar-62 69.55 3 112.5769
1-Feb-62 69.96 2 113.2405
2-Jan-62 68.84 1 111.4276
1-Dec-61 71.55 12 115.8142
1-Nov-61 71.32 11 115.4419
2-Oct-61 68.62 10 111.0715
1-Sep-61 66.73 9 108.0123
1-Aug-61 68.07 8 110.1813
3-Jul-61 66.76 7 108.0609
1-Jun-61 64.64 6 104.6293
1-May-61 66.56 5 107.7371
3-Apr-61 65.31 4 105.7138
1-Mar-61 65.06 3 105.3092
1-Feb-61 63.44 2 102.687
3-Jan-61 61.78 1 100
1-Dec-60 58.11 12 129.9419
1-Nov-60 55.54 11 124.195
3-Oct-60 53.39 10 119.3873
1-Sep-60 53.52 9 119.678
1-Aug-60 56.96 8 127.3703
1-Jul-60 55.51 7 124.1279
1-Jun-60 56.92 6 127.2809
2-May-60 55.83 5 124.8435
1-Apr-60 54.37 4 121.5787
1-Mar-60 55.34 3 123.7478
1-Feb-60 56.12 2 125.4919
4-Jan-60 55.61 1 124.3515
1-Dec-59 59.89 12 133.9222
2-Nov-59 58.28 11 130.322
1-Oct-59 57.52 10 128.6225
1-Sep-59 56.88 9 127.1914
3-Aug-59 59.6 8 133.2737
1-Jul-59 60.51 7 135.3086
1-Jun-59 58.47 6 130.7469
1-May-59 58.68 5 131.2165
1-Apr-59 57.59 4 128.7791
2-Mar-59 55.44 3 123.9714
2-Feb-59 55.41 2 123.9043
2-Jan-59 55.45 1 123.9937
1-Dec-58 55.21 12 123.4571
3-Nov-58 52.48 11 117.3524
1-Oct-58 51.33 10 114.7809
2-Sep-58 50.06 9 111.941
1-Aug-58 47.75 8 106.7755
1-Jul-58 47.19 7 105.5233
2-Jun-58 45.24 6 101.1628
1-May-58 44.09 5 98.59123
1-Apr-58 43.44 4 97.13775
3-Mar-58 42.1 3 94.14132
3-Feb-58 40.84 2 91.32379
2-Jan-58 41.7 1 93.24687
2-Dec-57 39.99 12 89.42308
1-Nov-57 41.72 11 93.29159
1-Oct-57 41.06 10 91.81574
3-Sep-57 42.42 9 94.85689
1-Aug-57 45.22 8 101.1181
1-Jul-57 47.91 7 107.1333
3-Jun-57 47.37 6 105.9258
1-May-57 47.43 5 106.0599
1-Apr-57 45.74 4 102.2809
1-Mar-57 44.11 3 98.63596
1-Feb-57 43.26 2 96.73524
2-Jan-57 44.72 1 100
3-Dec-56 46.67 12 180.1931
1-Nov-56 45.08 11 174.0541
1-Oct-56 45.58 10 175.9846
4-Sep-56 45.35 9 175.0965
1-Aug-56 47.51 8 183.4363
2-Jul-56 49.39 7 190.695
1-Jun-56 46.97 6 181.3514
1-May-56 45.2 5 174.5174
2-Apr-56 48.38 4 186.7954
1-Mar-56 48.48 3 187.1815
1-Feb-56 45.34 2 175.0579
3-Jan-56 43.82 1 169.1892
1-Dec-55 45.48 12 175.5985
1-Nov-55 45.51 11 175.7143
3-Oct-55 42.34 10 163.4749
1-Sep-55 43.67 9 168.61
1-Aug-55 43.18 8 166.7181
1-Jul-55 43.52 7 168.0309
1-Jun-55 41.03 6 158.417
2-May-55 37.91 5 146.3707
1-Apr-55 37.96 4 146.5637
1-Mar-55 36.58 3 141.2355
1-Feb-55 36.76 2 141.9305
3-Jan-55 36.63 1 141.4286
1-Dec-54 35.98 12 138.9189
1-Nov-54 34.24 11 132.2008
1-Oct-54 31.68 10 122.3166
1-Sep-54 32.31 9 124.749
2-Aug-54 29.83 8 115.1737
1-Jul-54 30.88 7 119.2278
1-Jun-54 29.21 6 112.7799
3-May-54 29.19 5 112.7027
1-Apr-54 28.26 4 109.112
1-Mar-54 26.94 3 104.0154
1-Feb-54 26.15 2 100.9653
4-Jan-54 26.08 1 100.695
1-Dec-53 24.81 12 95.79151
2-Nov-53 24.76 11 95.59846
1-Oct-53 24.54 10 94.74903
1-Sep-53 23.35 9 90.15444
3-Aug-53 23.32 8 90.03861
1-Jul-53 24.75 7 95.55985
1-Jun-53 24.14 6 93.20463
1-May-53 24.54 5 94.74903
1-Apr-53 24.62 4 95.05792
2-Mar-53 25.29 3 97.64479
2-Feb-53 25.9 2 100
2-Jan-53 26.38
1-Dec-52 26.57
3-Nov-52 25.66
1-Oct-52 24.52
2-Sep-52 24.54
1-Aug-52 25.03
1-Jul-52 25.4
2-Jun-52 24.96
1-May-52 23.86
1-Apr-52 23.32
3-Mar-52 24.37
1-Feb-52 23.26
2-Jan-52 24.14
3-Dec-51 23.77
1-Nov-51 22.88
1-Oct-51 22.94
4-Sep-51 23.26
1-Aug-51 23.28
2-Jul-51 22.4
1-Jun-51 20.96
1-May-51 21.52
2-Apr-51 22.43
1-Mar-51 21.48
1-Feb-51 21.8
2-Jan-51 21.66
1-Dec-50 20.43
1-Nov-50 19.51
2-Oct-50 19.53
1-Sep-50 19.45
1-Aug-50 18.42
3-Jul-50 17.84
1-Jun-50 17.69
1-May-50 18.78
3-Apr-50 17.96
1-Mar-50 17.29
1-Feb-50 17.22
3-Jan-50 17.05
Source: Bloomberg
PRESIDENTIAL ELECTION CYCLES DO NOT FAVOR ANY POLITICAL PARTY - THE
ECONOMIC STIMULATING POLICIES WORK FOR REPUBLICANS AND DEMOCRATS
ALIKE.
Understanding the Presidential election cycle may help you manage
your expectations better with the markets.
EMOTIONAL MANAGEMENT
We believe that chasing performance or trying to guess tops and
bottoms in prices is financially unhealthy. The ABC Investment
Plan(R), which is a dollar-cost averaging plan, allows you to better
manage volatility and maintain a disciplined investment approach even
when prices decline for several months because you are buying when
prices are on sale. The idea is
3
U.S. GLOBAL INVESTORS FUNDS
to invest a fixed-dollar amount into a particular investment on a regular
schedule, regardless of the share price. The money you invest generates
earnings through interest and dividends. In turn, these earnings are
compounded when reinvested by generating additional earnings. To set up your
own dollar cost averaging plan, ask one of our Investor Representatives
about our ABC Investment Plan(R).
Mr. Gibson also stresses the importance of rebalancing between the
four asset classes. Rebalancing allows you to take advantage of
swings in the market. We recommend rebalancing your portfolio
annually; usually at year-end or on some other date you may
remember, like your birthday. Rebalancing allows you to take profits
when certain sectors have appreciated and take advantage of a buying
opportunity in down sectors.
THE EASIEST WAY TO REBALANCE YOUR INVESTMENTS PERIODICALLY IS BY
EXCHANGING BETWEEN U.S. GLOBAL INVESTORS' FAMILY OF 13 NO-LOAD
MUTUAL FUNDS.
U.S. Global Investors seeks to educate shareholders with respect
to market cycles, global trends and the benefits of diversification,
mean reversion and rebalancing. Our model emphasizes informing and
educating investors on a consistent basis regarding the critical
drivers that are impacting the different asset classes. We believe
performance sells itself, and what is more important for investors
is a balanced, timely and insightful perspective of what drives
performance.
Sincerely,
/s/ Frank Holmes
Frank E. Holmes
Chairman, CEO and Chief Investment Officer
U.S. Global Investors, Inc.
Please consider carefully the fund's investment objectives, risks,
charges and expenses. For this and other important information,
obtain a fund prospectus by visiting www.usfunds.com or by calling
1-800-US-FUNDS (1-800-873-8637). Read it carefully before investing.
Distributed by U.S. Global Brokerage, Inc.
A program of regular investing doesn't assure a profit or protect
against loss in a declining market. You should evaluate your ability
to continue in such a program in view of the possibility that you
may have to redeem fund shares in periods of declining share prices
as well as in periods of rising prices. Diversification does not
protect an investor from market risks and does not assure a profit.
Foreign and emerging market investing involves special risks such as
currency fluctuation and less public disclosure, as well as economic
and political risk. Gold funds may be susceptible to adverse
4
U.S. GLOBAL INVESTORS FUNDS
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. The S&P 500 Stock Index is a
widely recognized capitalization-weighted index of 500 common stock prices
in U.S. companies. Holdings in the U.S. Global Investors Fund series as a
percentage of net assets as of 12/31/05: Microsoft (0.00%); Apple: All
American Equity Fund (2.11%); Intel (0.00%); Micron (0.00%). Morningstar
disclosure: The funds were ranked among distinctive portfolios only by
Morningstar's Principia and excluded index funds. According to Morningstar's
Principia ranking for domestic stock funds, the Global Resources Fund
(PSPFX) ranked #31 out of 11,842 funds, #1 out of 10,366 funds, #1 out of
8,905 funds, and #168 out of 4,619 funds for the 1-, 3-, 5- and 10-year
periods ending December 31, 2005, respectively. Lipper disclosure: For the
year ending December 31, 2005, the Global Resources Fund (PSPFX) ranked #27
out of 96, #1 out of 74, #1 out of 60, and #13 out of 29 natural resource
funds for total return for the 1-, 3-, 5- and 10-year periods, respectively.
The World Precious Minerals Fund (UNWPX) ranked #31 out of 52, #1 out of 46,
#1 out of 34, and #17 out of 24 gold oriented funds for total return for the
1-, 3-, 5-, and 10-year periods ending December 31, 2005, respectively. The
China Region Opportunity Fund (USCOX) ranked #1 out of 34, #1 out of 22, #2
out of 22, and #3 out of 6 China region funds for total return for the
1-, 3-, 5-, and 10-year periods ending December 31, 2005, respectively.
NOTE ON COMPARATIVE INDICES: An index, such as the S&P 500 Index, the
Lehman Municipal Bond Indices, etc., has no expenses; therefore, its
performance does not reflect the expenses and costs associated with
the active management of an actual portfolio, such as custody,
accounting, legal and compliance expenses and trading costs.
5
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, 2005
7-Day Yield 2.78%
---------------------------------------------------------------
7-Day Effective Yield 2.82%
---------------------------------------------------------------
Weighted Average Days to Maturity 42
U.S. GOVERNMENT SECURITIES SAVINGS FUND As of December 31, 2005
7-Day Yield 3.52%
---------------------------------------------------------------
7-Day Effective Yield 3.58%
---------------------------------------------------------------
Weighted Average Days to Maturity 45
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
The Federal Reserve (Fed) continued its path of "normalizing"
interest rates for the past six months. Over the past eighteen
months, the Fed has raised interest rates 13 times, bringing the Fed
Funds rate to 4.25 percent at the end of December 2005. The economy
continued to show solid economic growth even in the face of two
devastating hurricanes. Gross Domestic Product (GDP) growth in the
last six months of 2005 should end up in the 4 percent range, which
is solid economic growth for the largest economy in the world.
Employment gains have been less robust but are still improving.
Inflation expectations spiked after a hurricane induced supply shock
but fell sharply by the end of the year as core inflation indicators
remain contained. Over the past six months, the Fed raised interest
rates by one percent and short-term bond yields moved up in-line
6
MONEY MARKET FUNDS
with the rate increases, with yields on the three-month T-Bill
rising 95 basis points to 4.04 percent and yields on the six-month
T-Bills moving up 103 basis points to 4.29 percent. One-year agency
discount note yields moved up 96 basis points to 4.67 percent.
INVESTMENT HIGHLIGHTS
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 averaged a weighted average maturity
of 53 days, which was longer than the peer group average. This
proved beneficial as the Fed took a measured approach to rate
increases, meeting market expectations. The fund took advantage of
these progressively higher yields by selectively extending its
ladder through 2005 and 2006. The U.S. Treasury Securities Cash Fund
followed a similar laddered strategy, averaging a weighted average
maturity of 38 days. The fund took advantage of relatively high
overnight rates, keeping the weighted average maturity lower than
the U.S. Government Securities Savings Fund.
CURRENT OUTLOOK
The Fed is eighteen months into this interest rate cycle and is
nearing the end of its tightening campaign. Core inflation measures
remain contained, and economic growth has been relatively robust,
but early indicators appear to signal an economic slowdown ahead.
Numerous indicators show that the housing market is finally
beginning to slow, which has been a driver of consumption. The
personal savings rate has been negative for the last six months, and
equity market returns have been lackluster. These indicators point
to a consumer slowdown during 2006. GDP growth is likely to slow
from the current 3.5 - 4.0 percent range to the 2.5 percent range
for 2006. Worldwide growth has been unexpectedly strong but is also
likely to slow as we move through 2006. Current expectations are for
the Fed to raise interest rates to 4.75 percent by the first quarter
of 2006 and then pause and assess the situation.
7
TAX FREE FUNDS
MANAGEMENT TEAM'S PERSPECTIVE
INTRODUCTION
Our Tax Free Fund and Near-Term Tax Free Fund 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 will maintain a
weighted average maturity of less than five years, while the Tax
Free Fund will generally maintain a longer weighted average
maturity.
PERFORMANCE GRAPHS
NEAR-TERM TAX FREE FUND
[Near-Term Tax Free Fund Graph]
Lehman 3-Year
Near-Term Municipal
Date Tax Free Fund Bond Index
12/29/95 $ 10,000.00 $ 10,000.00
01/31/96 $ 10,076.19 $ 10,078.35
02/29/96 $ 10,076.19 $ 10,080.40
03/29/96 $ 10,028.25 $ 10,055.87
04/30/96 $ 10,028.25 $ 10,068.13
05/31/96 $ 10,037.91 $ 10,076.99
06/28/96 $ 10,096.04 $ 10,136.95
07/31/96 $ 10,154.40 $ 10,193.50
08/30/96 $ 10,183.69 $ 10,208.49
09/30/96 $ 10,252.30 $ 10,270.49
10/31/96 $ 10,321.17 $ 10,342.03
11/29/96 $ 10,429.82 $ 10,438.78
12/31/96 $ 10,429.82 $ 10,443.55
01/31/97 $ 10,469.66 $ 10,489.20
02/28/97 $ 10,527.66 $ 10,540.30
03/31/97 $ 10,457.41 $ 10,485.79
04/30/97 $ 10,508.79 $ 10,530.76
05/30/97 $ 10,606.90 $ 10,616.61
06/30/97 $ 10,687.09 $ 10,679.29
07/31/97 $ 10,865.37 $ 10,806.02
08/29/97 $ 10,809.16 $ 10,784.90
09/30/97 $ 10,910.69 $ 10,861.89
10/31/97 $ 10,958.03 $ 10,910.27
11/28/97 $ 10,993.15 $ 10,941.61
12/31/97 $ 11,108.16 $ 11,015.87
01/30/98 $ 11,197.60 $ 11,088.78
02/27/98 $ 11,192.39 $ 11,111.94
03/31/98 $ 11,188.20 $ 11,129.66
04/30/98 $ 11,173.49 $ 11,114.67
05/29/98 $ 11,294.71 $ 11,217.55
06/30/98 $ 11,330.67 $ 11,255.02
07/31/98 $ 11,364.75 $ 11,295.90
08/31/98 $ 11,493.04 $ 11,405.60
09/30/98 $ 11,604.65 $ 11,477.82
10/30/98 $ 11,599.27 $ 11,533.69
11/30/98 $ 11,616.53 $ 11,561.63
12/31/98 $ 11,623.03 $ 11,589.56
01/29/99 $ 11,725.14 $ 11,694.49
02/26/99 $ 11,696.80 $ 11,707.43
03/31/99 $ 11,706.64 $ 11,717.65
04/30/99 $ 11,743.95 $ 11,753.76
05/28/99 $ 11,710.93 $ 11,736.73
06/30/99 $ 11,597.24 $ 11,666.55
07/30/99 $ 11,652.62 $ 11,724.47
08/31/99 $ 11,617.04 $ 11,738.77
09/30/99 $ 11,649.40 $ 11,783.06
10/29/99 $ 11,628.14 $ 11,784.42
11/30/99 $ 11,693.24 $ 11,836.21
12/31/99 $ 11,669.59 $ 11,817.13
01/31/00 $ 11,654.89 $ 11,838.25
02/29/00 $ 11,693.47 $ 11,875.72
03/31/00 $ 11,791.39 $ 11,937.04
04/28/00 $ 11,760.54 $ 11,938.41
05/31/00 $ 11,747.93 $ 11,950.67
06/30/00 $ 11,904.42 $ 12,101.93
07/31/00 $ 12,014.11 $ 12,200.00
08/31/00 $ 12,119.54 $ 12,292.18
09/29/00 $ 12,113.72 $ 12,295.72
10/31/00 $ 12,191.91 $ 12,365.44
11/30/00 $ 12,245.79 $ 12,415.08
12/31/00 $ 12,426.77 $ 12,553.34
01/31/01 $ 12,556.46 $ 12,743.88
02/28/01 $ 12,583.68 $ 12,793.72
03/30/01 $ 12,665.59 $ 12,883.65
04/30/01 $ 12,611.98 $ 12,864.83
05/31/01 $ 12,714.78 $ 12,982.01
06/30/01 $ 12,762.76 $ 13,039.83
07/31/01 $ 12,877.04 $ 13,146.72
08/31/01 $ 13,014.62 $ 13,281.70
09/30/01 $ 13,050.94 $ 13,349.47
10/31/01 $ 13,143.21 $ 13,436.29
11/30/01 $ 13,057.94 $ 13,393.38
12/31/01 $ 13,000.53 $ 13,380.60
01/31/02 $ 13,174.52 $ 13,550.53
02/28/02 $ 13,285.13 $ 13,652.16
03/31/02 $ 13,084.25 $ 13,448.75
04/30/02 $ 13,314.28 $ 13,646.44
05/31/02 $ 13,377.56 $ 13,725.59
06/30/02 $ 13,483.34 $ 13,843.63
07/31/02 $ 13,596.84 $ 13,951.61
08/31/02 $ 13,720.68 $ 14,040.90
09/30/02 $ 13,902.53 $ 14,151.83
10/31/02 $ 13,774.32 $ 14,073.99
11/30/02 $ 13,740.29 $ 14,078.21
12/31/02 $ 13,936.04 $ 14,280.94
01/31/03 $ 13,957.56 $ 14,326.64
02/28/03 $ 14,085.71 $ 14,418.33
03/31/03 $ 14,083.17 $ 14,401.03
04/30/03 $ 14,139.25 $ 14,439.91
05/31/03 $ 14,335.95 $ 14,551.10
06/30/03 $ 14,288.59 $ 14,527.82
07/31/03 $ 14,010.25 $ 14,397.06
08/31/03 $ 14,106.65 $ 14,470.49
09/30/03 $ 14,373.33 $ 14,687.55
10/31/03 $ 14,304.88 $ 14,618.52
11/30/03 $ 14,347.60 $ 14,633.13
12/31/03 $ 14,396.90 $ 14,663.86
01/31/04 $ 14,454.12 $ 14,715.19
02/29/04 $ 14,587.06 $ 14,840.27
03/31/04 $ 14,545.27 $ 14,800.20
04/30/04 $ 14,354.13 $ 14,650.72
05/31/04 $ 14,293.78 $ 14,593.58
06/30/04 $ 14,317.44 $ 14,619.85
07/31/04 $ 14,416.32 $ 14,726.57
08/31/04 $ 14,568.28 $ 14,881.20
09/30/04 $ 14,600.07 $ 14,897.57
10/31/04 $ 14,633.25 $ 14,939.28
11/30/04 $ 14,573.39 $ 14,867.57
12/31/04 $ 14,649.39 $ 14,925.56
01/31/05 $ 14,669.44 $ 14,906.15
02/28/05 $ 14,635.94 $ 14,861.44
03/31/05 $ 14,535.24 $ 14,812.39
04/30/05 $ 14,636.18 $ 14,887.94
05/31/05 $ 14,676.65 $ 14,914.73
06/30/05 $ 14,710.46 $ 14,990.80
07/31/05 $ 14,676.57 $ 14,956.32
08/31/05 $ 14,717.34 $ 15,005.68
09/30/05 $ 14,751.40 $ 15,013.18
10/31/05 $ 14,717.26 $ 14,990.66
11/30/05 $ 14,758.33 $ 15,004.15
12/31/05 $ 14,792.65 $ 15,056.67
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2005
Six Month One Year Five Year Ten Year
Near-Term Tax Free Fund 0.56% 0.98% 3.55% 3.99%
----------------------------------------------------------------------
Lehman 3-Year Municipal Bond
Index 0.44% 0.88% 3.70% 4.17%
Performance data quoted above is historical. Past performance is no
guarantee of future results. Current performance may be higher or
lower than the performance data quoted. 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
0.45% through November 1, 2006.
8
TAX FREE FUNDS
TAX FREE FUND
[Tax Free Fund Graph]
Lehman 10-Year
Municipal
Date Tax Free Fund Bond Index
12/29/95 $ 10,000.00 $ 10,000.00
01/31/96 $ 10,058.77 $ 10,101.28
02/29/96 $ 10,008.19 $ 10,059.76
03/29/96 $ 9,889.64 $ 9,934.68
04/30/96 $ 9,864.16 $ 9,899.51
05/31/96 $ 9,872.69 $ 9,871.75
06/28/96 $ 9,958.39 $ 9,965.62
07/31/96 $ 10,044.39 $ 10,061.09
08/30/96 $ 10,044.39 $ 10,061.35
09/30/96 $ 10,165.82 $ 10,164.75
10/31/96 $ 10,252.86 $ 10,293.26
11/29/96 $ 10,410.19 $ 10,501.64
12/31/96 $ 10,383.86 $ 10,454.30
01/31/97 $ 10,419.12 $ 10,495.56
02/28/97 $ 10,505.87 $ 10,594.46
03/31/97 $ 10,407.21 $ 10,452.45
04/30/97 $ 10,495.57 $ 10,529.41
05/30/97 $ 10,628.22 $ 10,678.55
06/30/97 $ 10,747.91 $ 10,796.49
07/31/97 $ 11,014.58 $ 11,099.80
08/29/97 $ 10,921.13 $ 10,992.17
09/30/97 $ 11,040.45 $ 11,131.53
10/31/97 $ 11,092.59 $ 11,190.50
11/28/97 $ 11,157.78 $ 11,242.33
12/31/97 $ 11,327.32 $ 11,419.77
01/30/98 $ 11,426.34 $ 11,546.44
02/27/98 $ 11,411.47 $ 11,545.64
03/31/98 $ 11,400.29 $ 11,537.71
04/30/98 $ 11,352.55 $ 11,474.24
05/29/98 $ 11,536.75 $ 11,669.40
06/30/98 $ 11,576.37 $ 11,712.24
07/31/98 $ 11,613.37 $ 11,731.01
08/31/98 $ 11,796.29 $ 11,934.89
09/30/98 $ 11,935.97 $ 12,112.33
10/30/98 $ 11,895.64 $ 12,117.62
11/30/98 $ 11,950.59 $ 12,153.85
12/31/98 $ 11,963.17 $ 12,191.67
01/29/99 $ 12,103.34 $ 12,378.36
02/26/99 $ 12,023.24 $ 12,267.29
03/31/99 $ 12,043.81 $ 12,260.95
04/30/99 $ 12,077.27 $ 12,293.74
05/28/99 $ 11,970.62 $ 12,207.53
06/30/99 $ 11,736.75 $ 11,980.64
07/30/99 $ 11,760.63 $ 12,061.03
08/31/99 $ 11,609.87 $ 12,016.61
09/30/99 $ 11,605.86 $ 12,057.07
10/29/99 $ 11,418.64 $ 11,971.92
11/30/99 $ 11,558.09 $ 12,102.81
12/31/99 $ 11,433.27 $ 12,039.88
01/31/00 $ 11,317.71 $ 11,990.69
02/29/00 $ 11,476.90 $ 12,084.83
03/31/00 $ 11,782.13 $ 12,319.92
04/28/00 $ 11,689.98 $ 12,258.04
05/31/00 $ 11,593.34 $ 12,185.32
06/30/00 $ 11,921.00 $ 12,516.40
07/31/00 $ 12,091.75 $ 12,690.03
08/31/00 $ 12,277.86 $ 12,886.28
09/29/00 $ 12,186.02 $ 12,827.28
10/31/00 $ 12,342.84 $ 12,958.52
11/30/00 $ 12,442.86 $ 13,028.35
12/31/00 $ 12,776.10 $ 13,335.37
01/31/01 $ 12,892.93 $ 13,507.51
02/28/01 $ 12,914.45 $ 13,530.18
03/30/01 $ 13,027.83 $ 13,645.54
04/30/01 $ 12,858.75 $ 13,476.49
05/31/01 $ 12,991.47 $ 13,623.19
06/30/01 $ 13,090.82 $ 13,704.20
07/31/01 $ 13,279.24 $ 13,893.05
08/31/01 $ 13,502.39 $ 14,128.52
09/30/01 $ 13,442.82 $ 14,110.01
10/31/01 $ 13,603.25 $ 14,284.18
11/30/01 $ 13,436.68 $ 14,099.28
12/31/01 $ 13,262.87 $ 13,951.46
01/31/02 $ 13,501.07 $ 14,215.14
02/28/02 $ 13,676.14 $ 14,418.42
03/31/02 $ 13,374.48 $ 14,121.40
04/30/02 $ 13,673.82 $ 14,449.02
05/31/02 $ 13,744.12 $ 14,516.93
06/30/02 $ 13,899.99 $ 14,696.94
07/31/02 $ 14,065.47 $ 14,892.41
08/31/02 $ 14,210.93 $ 15,086.01
09/30/02 $ 14,498.14 $ 15,446.56
10/31/02 $ 14,259.58 $ 15,165.44
11/30/02 $ 14,175.15 $ 15,041.08
12/31/02 $ 14,457.03 $ 15,370.48
01/31/03 $ 14,410.47 $ 15,289.02
02/28/03 $ 14,594.68 $ 15,553.52
03/31/03 $ 14,579.49 $ 15,561.29
04/30/03 $ 14,675.60 $ 15,676.45
05/31/03 $ 15,019.87 $ 16,124.79
06/30/03 $ 14,940.94 $ 16,047.39
07/31/03 $ 14,357.48 $ 15,373.40
08/31/03 $ 14,479.49 $ 15,505.61
09/30/03 $ 14,877.41 $ 16,028.15
10/31/03 $ 14,788.07 $ 15,906.34
11/30/03 $ 14,895.58 $ 16,078.13
12/31/03 $ 14,990.17 $ 16,248.56
01/31/04 $ 15,079.06 $ 16,316.80
02/29/04 $ 15,295.85 $ 16,603.98
03/31/04 $ 15,221.00 $ 16,509.33
04/30/04 $ 14,861.36 $ 16,053.68
05/31/04 $ 14,816.44 $ 16,063.31
06/30/04 $ 14,754.35 $ 16,116.32
07/31/04 $ 14,888.70 $ 16,337.11
08/31/04 $ 15,100.52 $ 16,694.89
09/30/04 $ 15,163.13 $ 16,783.38
10/31/04 $ 15,266.52 $ 16,917.64
11/30/04 $ 15,139.40 $ 16,726.47
12/31/04 $ 15,310.23 $ 16,923.85
01/31/05 $ 15,417.02 $ 17,067.70
02/28/05 $ 15,339.81 $ 16,960.17
03/31/05 $ 15,243.62 $ 16,810.92
04/30/05 $ 15,451.72 $ 17,137.05
05/31/05 $ 15,542.24 $ 17,251.87
06/30/05 $ 15,606.58 $ 17,351.93
07/31/05 $ 15,549.62 $ 17,204.44
08/31/05 $ 15,689.25 $ 17,414.34
09/30/05 $ 15,597.56 $ 17,257.61
10/31/05 $ 15,520.91 $ 17,126.45
11/30/05 $ 15,593.97 $ 17,232.63
12/31/05 $ 15,735.61 $ 17,389.45
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2005
Six Month One Year Five Year Ten Year
Tax Free Fund 0.83% 2.78% 4.25% 4.63%
----------------------------------------------------------------------
Lehman 10-Year Municipal
Bond Index 0.22% 2.75% 5.45% 5.68%
Performance data quoted above is historical. Past performance is no
guarantee of future results. Current performance may be higher or
lower than the performance data quoted. 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
0.70% through November 1, 2006.
PERFORMANCE COMMENTARY
The Near-Term Tax Free Fund and the Tax Free Fund outperformed their
respective benchmark indices, the Lehman 3-year Municipal Bond Index
and the Lehman 10-year Municipal Bond Index, respectively, for the
six-month and one-year periods ended December 31, 2005. The Lehman
Municipal Bond Indices have no expenses; therefore, their
performance does not reflect the expenses and costs associated with
the active management of an actual portfolio, such as custody,
accounting, legal and compliance expenses and trading costs.
9
TAX FREE FUNDS
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
Municipals rallied strongly during the first six months of 2005 but have
struggled over the past six months. The municipal yield curve rose across
the board and flattened considerably. Yields on 1 year municipals rose about
50 basis points, while 30 year municipal yields rose by about 10 basis
points. Bond yields were driven higher by rising inflation concerns after
the energy price spikes witnessed after Hurricanes Katrina and Rita. Energy
prices receded and did not filter down into core inflation indicators, which
allowed bonds to post a modest rally during the last six weeks of 2005. Over
the past six months, economic data was surprisingly strong, and the Fed
continued to increase interest rates four times for a total of 100 basis
points over that time. The best performing municipal sector over the past
six months was the industrial development sector. The sector is leveraged to
volatile tobacco-backed municipals, which received favorable court rulings
over the past year. The housing and hospital sector also posted strong
performance during this time. The high yield portion of the municipal
market, which is tied to airline-backed bonds also posted very strong
returns over the past six months.
INVESTMENT HIGHLIGHTS
STRENGTHS
* The Tax Free Fund maintained an overweight position in long dated
municipals, which significantly outperformed over the past six
months.
* The Tax Free Fund was also significantly overweight in the
medical/hospital sector which was the second best performing
sector over the past six months.
* During the last three months of 2005, the Near-Term Tax Free Fund
increased exposure to intermediate term municipal (5-10 years),
which outperformed.
WEAKNESSES
* In the past six months, both funds were underweight in California
municipals, which outperformed.
* The funds' lack of exposure to risky airline and tobacco-backed
bonds was detrimental to performance, as these two sectors were by
far the best performers over the past twelve months.
* The funds' conservative credit profile detracted from performance
as lower rated credits generally outperformed the market.
10
TAX FREE FUNDS
CURRENT OUTLOOK
OPPORTUNITIES
* Market sentiment remains negative, as many still believe bond
yields must move higher. This likely remains a contrarian
indicator and provides an opportunity to extend maturity on market
weakness.
* With the strong performance of high-yield related securities, odds
favor a reversal, so issues with higher-quality credit may
outperform over the next year.
* The market and the Fed appear to have diverging views on the
market and the economy. This increases both the likelihood of a
volatile market and buying opportunities.
THREATS
* Inflation has remained contained. If commodity prices remain
strong, inflation remains a threat to the market.
* A stronger than expected global economy could pose a threat to
long dated municipals.
* If the Fed were to continue raising interest rates to 5 percent or
more, this would be negative for municipals across the board.
11
TAX FREE FUNDS
NEAR-TERM TAX FREE FUND
MUNICIPAL BOND RATINGS
(BASED ON TOTAL MUNICIPAL BONDS) December 31, 2005
[Near-Term Tax Free Fund Pie Graph]
AA 31.07%
A 13.40%
BBB 5.48%
B 0.70%
CCC 1.30%
AAA 48.05%
TAX FREE FUND
MUNICIPAL BOND RATINGS
(BASED ON TOTAL MUNICIPAL BONDS) December 31, 2005
[Tax Free Fund Pie Graph]
AA 19.28%
A 29.27%
BBB 7.85%
AAA 43.60%
12
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 individual stock opportunities. The fund seeks capital
appreciation and does not emphasize income.
PERFORMANCE GRAPH
ALL AMERICAN EQUITY FUND
[All American Equity Fund Graph]
All American S&P
Date Equity Fund 500 Index
12/29/1995 $ 10,000.00 $ 10,000.00
1/31/1996 $ 10,308.45 $ 10,340.36
2/29/1996 $ 10,420.21 $ 10,436.23
3/29/1996 $ 10,500.67 $ 10,536.69
4/30/1996 $ 10,653.24 $ 10,692.03
5/31/1996 $ 10,985.32 $ 10,967.78
6/28/1996 $ 11,061.60 $ 11,009.62
7/31/1996 $ 10,678.62 $ 10,523.20
8/30/1996 $ 10,827.31 $ 10,745.19
9/30/1996 $ 11,377.01 $ 11,349.98
10/31/1996 $ 11,612.33 $ 11,663.02
11/29/1996 $ 12,431.44 $ 12,544.59
12/31/1996 $ 12,227.79 $ 12,296.03
1/31/1997 $ 13,067.05 $ 13,064.22
2/28/1997 $ 13,081.11 $ 13,166.61
3/31/1997 $ 12,576.62 $ 12,625.85
4/30/1997 $ 13,432.94 $ 13,379.35
5/30/1997 $ 14,190.46 $ 14,193.93
6/30/1997 $ 14,787.53 $ 14,829.84
7/31/1997 $ 15,693.47 $ 16,009.82
8/29/1997 $ 14,886.62 $ 15,112.92
9/30/1997 $ 15,566.54 $ 15,940.61
10/31/1997 $ 15,088.66 $ 15,408.24
11/28/1997 $ 15,684.83 $ 16,121.52
12/31/1997 $ 15,933.23 $ 16,398.39
1/30/1998 $ 16,245.83 $ 16,579.76
2/27/1998 $ 17,260.60 $ 17,775.57
3/31/1998 $ 18,059.90 $ 18,685.84
4/30/1998 $ 18,334.71 $ 18,873.83
5/29/1998 $ 18,069.55 $ 18,549.43
6/30/1998 $ 18,825.98 $ 19,302.89
7/31/1998 $ 18,767.76 $ 19,097.35
8/31/1998 $ 16,307.76 $ 16,336.31
9/30/1998 $ 17,344.65 $ 17,382.82
10/30/1998 $ 18,439.02 $ 18,796.77
11/30/1998 $ 19,591.77 $ 19,936.00
12/31/1998 $ 20,528.45 $ 21,084.82
1/29/1999 $ 21,259.11 $ 21,966.50
2/26/1999 $ 20,618.53 $ 21,283.81
3/31/1999 $ 21,148.51 $ 22,135.34
4/30/1999 $ 21,670.45 $ 22,992.54
5/28/1999 $ 21,314.12 $ 22,449.57
6/30/1999 $ 22,494.50 $ 23,695.50
7/30/1999 $ 21,735.98 $ 22,955.61
8/31/1999 $ 21,454.67 $ 22,842.05
9/30/1999 $ 20,799.63 $ 22,215.85
10/29/1999 $ 22,052.44 $ 23,621.69
11/30/1999 $ 22,374.45 $ 24,101.88
12/31/1999 $ 23,527.63 $ 25,521.39
1/31/2000 $ 22,352.78 $ 24,239.13
2/29/2000 $ 21,872.63 $ 23,780.29
3/31/2000 $ 23,794.27 $ 26,106.57
4/28/2000 $ 23,206.32 $ 25,321.25
5/31/2000 $ 22,541.67 $ 24,801.73
6/30/2000 $ 23,107.13 $ 25,413.17
7/31/2000 $ 22,488.28 $ 25,015.86
8/31/2000 $ 23,981.70 $ 26,569.70
9/29/2000 $ 22,196.76 $ 25,167.00
10/31/2000 $ 21,388.67 $ 25,060.60
11/30/2000 $ 18,992.93 $ 23,084.84
12/31/2000 $ 19,102.55 $ 23,197.82
1/31/2001 $ 19,265.82 $ 24,020.86
2/28/2001 $ 16,921.26 $ 21,830.60
3/30/2001 $ 15,720.91 $ 20,447.62
4/30/2001 $ 17,172.67 $ 22,036.61
5/31/2001 $ 17,074.58 $ 22,184.25
6/30/2001 $ 16,646.24 $ 21,644.32
7/31/2001 $ 16,266.73 $ 21,431.25
8/31/2001 $ 15,043.13 $ 20,089.62
9/30/2001 $ 14,376.36 $ 18,467.33
10/31/2001 $ 14,546.57 $ 18,819.48
11/30/2001 $ 15,423.82 $ 20,263.05
12/31/2001 $ 15,463.10 $ 20,440.57
1/31/2002 $ 14,939.37 $ 20,142.28
2/28/2002 $ 14,572.76 $ 19,753.83
3/31/2002 $ 15,240.51 $ 20,496.75
4/30/2002 $ 14,481.11 $ 19,254.08
5/31/2002 $ 15,495.83 $ 19,112.23
6/30/2002 $ 13,878.82 $ 17,750.69
7/31/2002 $ 12,045.77 $ 16,367.11
8/31/2002 $ 12,268.35 $ 16,474.57
9/30/2002 $ 11,188.16 $ 14,684.12
10/31/2002 $ 11,744.62 $ 15,976.56
11/30/2002 $ 11,790.45 $ 16,916.93
12/31/2002 $ 11,351.82 $ 15,923.09
1/31/2003 $ 11,201.25 $ 15,505.97
2/28/2003 $ 11,017.95 $ 15,273.32
3/31/2003 $ 11,181.61 $ 15,421.61
4/30/2003 $ 12,026.13 $ 16,691.89
5/31/2003 $ 12,562.95 $ 17,571.34
6/30/2003 $ 12,536.76 $ 17,795.50
7/31/2003 $ 12,844.45 $ 18,109.25
8/31/2003 $ 13,283.08 $ 18,462.43
9/30/2003 $ 13,099.77 $ 18,266.37
10/31/2003 $ 14,081.76 $ 19,299.70
11/30/2003 $ 14,585.85 $ 19,469.50
12/31/2003 $ 14,906.63 $ 20,490.57
1/31/2004 $ 14,952.46 $ 20,866.67
2/29/2004 $ 15,148.86 $ 21,156.71
3/31/2004 $ 15,037.57 $ 20,837.53
4/30/2004 $ 14,193.05 $ 20,510.41
5/31/2004 $ 14,369.81 $ 20,791.88
6/30/2004 $ 14,749.52 $ 21,196.17
7/31/2004 $ 13,911.55 $ 20,494.65
8/31/2004 $ 13,878.82 $ 20,577.55
9/30/2004 $ 14,310.89 $ 20,800.41
10/31/2004 $ 14,526.93 $ 21,118.19
11/30/2004 $ 15,404.18 $ 21,972.66
12/31/2004 $ 15,659.50 $ 22,720.36
1/31/2005 $ 15,286.34 $ 22,166.55
2/28/2005 $ 15,842.80 $ 22,633.03
3/31/2005 $ 15,580.94 $ 22,232.24
4/30/2005 $ 15,044.11 $ 21,810.60
5/31/2005 $ 15,652.95 $ 22,504.58
6/30/2005 $ 16,019.56 $ 22,536.52
7/31/2005 $ 16,641.49 $ 23,374.62
8/31/2005 $ 16,602.21 $ 23,161.35
9/30/2005 $ 17,309.24 $ 23,348.94
10/31/2005 $ 16,785.51 $ 22,959.69
11/30/2005 $ 17,499.09 $ 23,828.08
12/31/2005 $ 17,518.61 $ 23,836.25
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2005
Six Month One Year Five Year Ten Year
All American Equity Fund 9.36% 11.87% (1.72)% 5.76%
----------------------------------------------------------------------
S&P 500 Index 5.77% 4.91% 0.54% 9.06%
Performance data quoted above is historical. Past performance is no
guarantee of future results. Current performance may be higher or
lower than the performance data quoted. 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 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% through November 1, 2006.
13
ALL AMERICAN EQUITY FUND
PERFORMANCE COMMENTARY
The All American Equity Fund outperformed the S&P 500 Index for the
six-month and one-year periods ended December 31, 2005.
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
Critical drivers that drove the market higher include the following:
* Terrorism remained a concern as a series of coordinated attacks on
London's subway and bus systems greeted the Group of Eight in
London for a summit meeting.
* The Fed increased the Fed Funds rate four times to finish the year
at 4.25 percent.
* The House of Representatives approved CAFTA, which is intended to
facilitate trade between the U.S. and Central America.
* Hurricanes Katrina and Rita caused massive damage to the Gulf
Coast, estimated at more than $200 billion. Plans to rebuild the
city of New Orleans were made as President Bush pledged one of the
largest reconstruction efforts ever undertaken.
Inflation caused a scare in September of 2005 as the consumer price
index (CPI) on a year-over-year basis spiked to 4.7 percent from 3.6
percent in August. The time period ended with CPI at 3.4 percent.
Excluding food and energy, CPI moved in a far more narrow range of
2.0 percent to 2.2 percent.
The job situation improved slightly as the unemployment rate fell to
4.9 percent at the end of the six-month time period from 5.0 percent
at the start of it.
On the political front, President Bush's approval ratings hit an
all-time low in September as no clear strategy for winning the war
or withdrawal from Iraq had been presented. Tom Delay, the House
majority leader, was indicted and charged with conspiracy and money
laundering. I. Lewis Libby was indicted and charged with obstruction
of justice, perjury and making false statements during an
investigation into the disclosure of the identity of a covert CIA
officer. The Democratic Party won gubernatorial elections in
Virginia and New Jersey.
14
ALL AMERICAN EQUITY FUND
INVESTMENT HIGHLIGHTS
STRENGTHS
* The materials sector was the best performing sector during the
six-month time period. Steel, gold and other metals hit new highs
on declining inventories and continued strong demand from China.
* Energy was the second best performing sector. Hurricanes Katrina
and Rita caused damage in the Gulf Coast and caused a spike in
energy prices.
* Railroad stocks also performed well as loadings and shipments
remained strong, and the rail companies were able to pass on
higher energy costs to their customers.
WEAKNESSES
* The telecom sector was the worst performing sector during the time
period. Verizon Communications, Inc.'s(1) purchase of MCI, Inc.(1)
drove that stock lower as did their spending plans to introduce
Fiber to the Home (FTTH) technology.
* The auto companies hit new lows over fears about bankruptcies,
healthcare costs and competition from China.
* Healthcare facilities were poor performers as the problems over
bad debts have not been resolved as cleanly as first thought.
CURRENT OUTLOOK
OPPORTUNITIES
* Stock selection will be the key to performance over the next 12
months. Our model of looking for revenue and earnings acceleration
will help pick the fastest growing companies.
* Our use of oscillators will allow for timely accumulation of stock
as well as opportune profit taking.
* A Goldilocks economy could propel the market higher as growth
resumes with little inflation.
15
ALL AMERICAN EQUITY FUND
WEAKNESSES
* A global slowdown could weigh on the equity markets.
* Trade tensions between the U.S. and China may mount as we move
closer to resolution on takeovers and currency revaluation.
* Home prices could fall in the face of higher interest rates.
(1)The fund did not hold this security as of December 31, 2005.
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2005
GOLDCORP, INC. 6.25%
GOLD MINING
---------------------------------------------------------------
UNITEDHEALTH GROUP, INC. 2.39%
MEDICAL - HMO
---------------------------------------------------------------
APPLE COMPUTER, INC. 2.22%
COMPUTERS
---------------------------------------------------------------
BURLINGTON NORTHERN SANTA FE CORP. 2.18%
TRANSPORTATION
---------------------------------------------------------------
GOOGLE, INC. 2.13%
INTERNET
---------------------------------------------------------------
INTUITIVE SURGICAL, INC. 2.11%
MEDICAL - PRODUCTS
---------------------------------------------------------------
HOLOGIC, INC. 1.95%
MEDICAL - PRODUCTS
---------------------------------------------------------------
FRANKLIN RESOURCES, INC. 1.93%
INVESTMENT ADVISERS
---------------------------------------------------------------
ADVANCED MICRO DEVICES, INC. 1.89%
ELECTRONICS & COMPONENTS
---------------------------------------------------------------
PORTALPLAYER, INC. 1.82%
ELECTRONICS & COMPONENTS
16
ALL AMERICAN EQUITY FUND
PORTFOLIO ALLOCATION BY INDUSTRY SECTOR
BASED ON TOTAL INVESTMENTS December 31, 2005
[All American Pie Graph]
Industrials 11.6%
Consumer Discretion 10.1%
Materials 9.0%
Energy 6.5%
Cash Equivalent 5.8%
Other 4.3%
Information Technology 25.0%
Health Care 14.2%
Financial Services 13.5%
17
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 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 GRAPH
CHINA REGION OPPORTUNITY FUND
[China Region Fund Graph]
IFC Emerging
Morgan Stanley Markets
China Region Capital Far East Investable
Opportunity Free ex Total
Date Fund Japan Index China Index
12/31/1995 $ 10,000.00 $ 10,000.00 $ 10,000.00
1/31/1996 $ 10,751.25 $ 10,903.02 $ 11,372.21
2/29/1996 $ 10,951.59 $ 10,849.97 $ 11,698.11
3/29/1996 $ 10,651.09 $ 10,916.80 $ 11,080.62
4/30/1996 $ 10,601.00 $ 11,202.65 $ 10,943.40
5/31/1996 $ 10,717.86 $ 11,074.60 $ 11,234.99
6/28/1996 $ 10,851.42 $ 10,836.45 $ 11,200.69
7/31/1996 $ 10,716.41 $ 10,036.86 $ 10,891.94
8/30/1996 $ 10,733.29 $ 10,380.49 $ 11,337.91
9/30/1996 $ 10,783.91 $ 10,629.47 $ 11,286.45
10/31/1996 $ 10,817.83 $ 10,416.47 $ 11,183.53
11/29/1996 $ 11,665.62 $ 11,000.24 $ 12,229.85
12/31/1996 $ 12,784.70 $ 10,918.24 $ 14,078.90
1/31/1997 $ 12,750.79 $ 11,062.44 $ 13,955.40
2/28/1997 $ 13,106.86 $ 11,092.70 $ 14,344.77
3/31/1997 $ 12,920.35 $ 10,459.19 $ 13,888.51
4/30/1997 $ 13,683.36 $ 10,176.91 $ 15,909.09
5/30/1997 $ 14,395.51 $ 10,671.71 $ 15,692.97
6/30/1997 $ 14,582.02 $ 10,939.13 $ 15,878.22
7/31/1997 $ 15,667.20 $ 10,971.74 $ 18,334.48
8/29/1997 $ 15,853.71 $ 8,935.96 $ 21,250.43
9/30/1997 $ 14,955.05 $ 8,856.17 $ 16,861.06
10/31/1997 $ 11,360.41 $ 6,680.88 $ 13,826.76
11/28/1997 $ 10,258.28 $ 6,245.35 $ 10,936.54
12/31/1997 $ 9,914.08 $ 5,952.27 $ 10,716.98
1/30/1998 $ 7,743.24 $ 5,438.76 $ 7,619.21
2/27/1998 $ 9,896.99 $ 6,675.72 $ 10,480.27
3/31/1998 $ 9,896.99 $ 6,500.48 $ 9,838.77
4/30/1998 $ 9,093.60 $ 5,818.85 $ 8,626.07
5/29/1998 $ 8,068.01 $ 4,901.88 $ 8,013.72
6/30/1998 $ 6,991.14 $ 4,354.31 $ 7,126.93
7/31/1998 $ 5,914.26 $ 4,222.40 $ 5,536.88
8/31/1998 $ 4,871.57 $ 3,558.04 $ 4,301.89
9/30/1998 $ 5,914.26 $ 3,932.46 $ 5,732.42
10/30/1998 $ 6,717.64 $ 4,998.10 $ 5,692.97
11/30/1998 $ 6,922.76 $ 5,444.27 $ 5,777.02
12/31/1998 $ 6,615.08 $ 5,512.54 $ 5,262.44
1/29/1999 $ 5,788.20 $ 5,324.45 $ 4,593.48
2/26/1999 $ 5,753.75 $ 5,221.00 $ 4,632.93
3/31/1999 $ 6,373.91 $ 5,789.07 $ 4,857.63
4/30/1999 $ 7,700.37 $ 7,118.51 $ 6,243.57
5/28/1999 $ 7,510.88 $ 6,788.94 $ 6,072.04
6/30/1999 $ 9,612.54 $ 7,954.86 $ 8,310.46
7/30/1999 $ 9,130.19 $ 7,636.28 $ 7,977.70
8/31/1999 $ 9,181.87 $ 7,753.27 $ 8,097.77
9/30/1999 $ 8,699.52 $ 7,125.77 $ 7,689.54
10/29/1999 $ 8,613.39 $ 7,461.20 $ 7,677.53
11/30/1999 $ 9,543.64 $ 8,198.73 $ 9,833.62
12/31/1999 $ 10,301.62 $ 8,787.02 $ 10,801.03
1/31/2000 $ 10,353.30 $ 8,586.83 $ 10,886.79
2/29/2000 $ 11,042.37 $ 8,125.62 $ 13,651.80
3/31/2000 $ 11,473.04 $ 8,489.84 $ 13,737.56
4/28/2000 $ 10,301.62 $ 7,788.59 $ 11,698.11
5/31/2000 $ 9,750.36 $ 7,145.50 $ 11,835.33
6/30/2000 $ 10,525.56 $ 7,468.28 $ 13,636.36
7/31/2000 $ 10,577.24 $ 7,190.29 $ 13,468.27
8/31/2000 $ 10,353.30 $ 7,092.90 $ 13,200.69
9/29/2000 $ 9,491.96 $ 6,264.81 $ 11,730.70
10/31/2000 $ 8,647.84 $ 5,768.73 $ 11,185.25
11/30/2000 $ 8,182.72 $ 5,474.66 $ 9,631.22
12/31/2000 $ 8,356.71 $ 5,458.83 $ 9,818.18
1/31/2001 $ 8,705.63 $ 6,188.93 $ 10,903.95
2/28/2001 $ 8,269.48 $ 5,885.39 $ 10,272.73
3/30/2001 $ 8,199.70 $ 5,240.75 $ 9,247.00
4/30/2001 $ 8,531.17 $ 5,248.65 $ 10,420.24
5/31/2001 $ 8,810.31 $ 5,197.26 $ 11,042.88
6/30/2001 $ 8,583.51 $ 5,079.17 $ 11,234.99
7/31/2001 $ 7,868.22 $ 4,876.57 $ 9,742.71
8/31/2001 $ 7,257.60 $ 4,788.74 $ 7,823.33
9/30/2001 $ 6,437.63 $ 4,020.74 $ 7,454.55
10/31/2001 $ 6,681.88 $ 4,221.90 $ 7,564.32
11/30/2001 $ 7,152.93 $ 4,797.02 $ 8,089.19
12/31/2001 $ 7,257.60 $ 5,230.31 $ 8,061.75
1/31/2002 $ 7,432.07 $ 5,440.97 $ 7,485.42
2/28/2002 $ 7,344.83 $ 5,449.46 $ 7,622.64
3/31/2002 $ 7,711.20 $ 5,834.52 $ 7,993.14
4/30/2002 $ 7,920.56 $ 5,903.54 $ 8,210.98
5/31/2002 $ 7,903.11 $ 5,768.07 $ 8,262.44
6/30/2002 $ 7,641.42 $ 5,450.42 $ 8,058.32
7/31/2002 $ 7,135.48 $ 5,240.05 $ 7,732.42
8/31/2002 $ 6,873.79 $ 5,115.18 $ 7,584.91
9/30/2002 $ 6,298.06 $ 4,524.72 $ 7,030.87
10/31/2002 $ 6,350.40 $ 4,765.08 $ 6,972.56
11/30/2002 $ 6,646.99 $ 4,998.92 $ 7,276.16
12/31/2002 $ 6,367.85 $ 4,652.37 $ 7,049.74
1/31/2003 $ 6,559.76 $ 4,707.25 $ 7,428.82
2/28/2003 $ 6,559.76 $ 4,476.18 $ 7,271.01
3/31/2003 $ 6,280.62 $ 4,261.61 $ 6,991.42
4/30/2003 $ 6,315.51 $ 4,396.60 $ 7,015.44
5/31/2003 $ 7,030.80 $ 4,755.21 $ 7,852.49
6/30/2003 $ 7,275.05 $ 5,023.22 $ 8,363.64
7/31/2003 $ 7,955.45 $ 5,441.98 $ 9,166.38
8/31/2003 $ 8,566.07 $ 5,826.19 $ 9,742.71
9/30/2003 $ 8,845.20 $ 5,840.35 $ 9,811.32
10/31/2003 $ 10,363.02 $ 6,330.95 $ 11,248.71
11/30/2003 $ 10,659.61 $ 6,229.68 $ 11,468.27
12/31/2003 $ 11,534.37 $ 6,549.27 $ 12,969.13
1/31/2004 $ 11,604.71 $ 6,972.45 $ 12,948.54
2/29/2004 $ 12,255.27 $ 7,223.08 $ 13,753.00
3/31/2004 $ 11,850.87 $ 7,059.77 $ 12,617.50
4/30/2004 $ 10,655.23 $ 6,631.88 $ 10,881.65
5/31/2004 $ 10,602.48 $ 6,449.68 $ 11,598.63
6/30/2004 $ 10,303.57 $ 6,375.90 $ 11,586.62
7/31/2004 $ 10,198.07 $ 6,185.10 $ 11,706.69
8/31/2004 $ 10,285.99 $ 6,486.70 $ 11,696.40
9/30/2004 $ 10,989.30 $ 6,696.34 $ 12,590.05
10/31/2004 $ 11,006.89 $ 6,720.62 $ 12,195.54
11/30/2004 $ 11,710.20 $ 7,290.60 $ 13,355.06
12/31/2004 $ 12,019.96 $ 7,481.40 $ 13,049.74
1/31/2005 $ 11,624.09 $ 7,524.60 $ 12,797.60
2/28/2005 $ 12,685.74 $ 7,945.27 $ 13,787.31
3/31/2005 $ 12,289.87 $ 7,557.42 $ 13,070.33
4/30/2005 $ 12,073.94 $ 7,461.55 $ 13,109.78
5/31/2005 $ 11,912.00 $ 7,603.35 $ 13,207.55
6/30/2005 $ 12,361.84 $ 7,760.17 $ 13,751.29
7/31/2005 $ 12,811.69 $ 8,235.35 $ 14,682.68
8/31/2005 $ 12,739.72 $ 7,935.53 $ 14,742.71
9/30/2005 $ 13,441.48 $ 8,316.29 $ 15,557.46
10/31/2005 $ 12,631.75 $ 7,790.30 $ 13,881.65
11/30/2005 $ 13,207.56 $ 8,337.79 $ 14,806.17
12/31/2005 $ 14,265.31 $ 8,817.55 $ 15,236.71
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2005
Six Month One Year Five Year Ten Year
China Region Opportunity
Fund 15.40% 18.68% 11.28% 3.61%
-----------------------------------------------------------------------
Hang Seng Composite Index 7.83% 10.27% n/a n/a
-----------------------------------------------------------------------
Morgan Stanley Capital Far
East Free ex Japan Index* 13.63% 17.86% 10.05% (1.25)%
-----------------------------------------------------------------------
IFC Emerging Markets
Investable Total China
Index 10.80% 16.76% 9.18% 4.30%
<FN>
* These are not total returns. These returns reflect simple
appreciation only and do not reflect dividend reinvestment.
Performance data quoted above is historical. Past performance is no
guarantee of future results. Current performance may be higher or lower
than the performance data quoted. 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 it had less than ten years of data. 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>
18
CHINA REGION OPPORTUNITY FUND
PERFORMANCE COMMENTARY
The China Region Opportunity Fund outperformed the Hang Seng
Composite Index, the Morgan Stanley Capital Far East Free ex Japan
Index, and the IFC Emerging Markets Investable Total China Index for
the six-month and one-year periods ended December 31, 2005.
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
Critical drivers for the period include:
* China revalued its currency and pegged the Yuan to a basket of
currencies instead of the U.S. Dollar solely.
* CNOOC Ltd.(1) was blocked from buying Unocal Corp.(2) despite a
higher offer to shareholders.
* China's trade surplus hit record levels placing more pressure on
them to make further moves on their currency.
* South Korea's national pride took a hit as Dr. Hwang Woo-suk
admitted that some of his research regarding cloning was
fabricated.
With CNOOC having been blocked from buying Unocal, China's oil
companies still expect some concerns as they continue their
asset-buying sprees. China continued to report strong GDP growth and
even reported that their overall economy is much larger than at
first measured.
South Korea ended 2005 as the best performing country in Asia as
consumer confidence improved and new plans to increase domestic
purchases of stock were put into place. In addition, inflation was
fairly tame despite a pick-up in manufacturing activity.
Hong Kong was restrained by higher interest rates. As the Hong Kong
Dollar is pegged to the U.S. Dollar, Hong Kong had to match interest
rate hikes undertaken by the Fed. This caused financial stocks to
underperform during the time period.
Taiwan was mostly unchanged during the six-month time period, but
the markets did pick up during the last three months of 2005 as
strong demand for consumer electronics during the holiday seasons
benefited many Taiwan electronics companies.
INVESTMENT HIGHLIGHTS
STRENGTHS
* The fund benefited from its exposure to the Korean markets, the
best performing market during the time period.
* The fund was overweight in the oil and resources sector, which was
the second best performing sector in the HSCI.
19
CHINA REGION OPPORTUNITY FUND
* The fund was underweight in the consumer goods sector, the worst
performing sector in the HSCI.
* The fund continued to benefit from its exposure to technology
stocks including Taiwan and Korea, which benefited from strong
demand for consumer electronics such as iPods and flat screen
televisions.
WEAKNESSES
* The China B share markets performed poorly, particularly in the
last three months of the time period, as the government decided to
unwind some non-tradable shares.
CURRENT OUTLOOK
OPPORTUNITIES
* The long-term growth outlook remains intact. A slowdown in China's
growth would be better to achieve a soft landing or no landing
scenario. However, that seems unlikely prior to Beijing's hosting
of the Summer Olympic Games in 2008.
* There appears to be improved relations between Taiwan and the
Mainland. The less tension there, the better the outlook for the
Taiwan markets.
THREATS
* Relations between the U.S. and China may be hurt by the record
trade deficits recorded in 2005 as well as China's dealings with
other countries in an attempt to satisfy their appetite for
natural resources.
* A revaluation of the Chinese currency could hurt the employment
situation in China as many of the jobs there are export dependent.
A stronger currency could hurt exports.
* Kim Jong Il remains a threat so long as he remains the leader of
North Korea. There seldom appears to be any rationale for some of
his rhetoric or actions.
(1)This security comprised 1.37 percent of the total net assets of
the fund as of December 31, 2005.
(2)The fund did not hold this security as of December 31, 2005.
20
CHINA REGION OPPORTUNITY FUND
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2005
BIG SKY ENERGY CORP. 5.14%
OIL & GAS EXPLORATION & PRODUCTION
---------------------------------------------------------------
KOOKMIN BANK 4.06%
BANKS
---------------------------------------------------------------
HON HAI PRECISION INDUSTRY CO., LTD. 3.03%
ELECTRONICS & COMPONENTS
---------------------------------------------------------------
CHINA MOBILE (HONG KONG) LTD. 2.89%
CELLULAR TELECOMMUNICATIONS
---------------------------------------------------------------
TAIWAN SEMICONDUCTOR MANUFACTURING CO., LTD. 2.69%
SEMICONDUCTORS
---------------------------------------------------------------
HYUNDAI MOTOR CO. 2.61%
AUTOMOBILE
---------------------------------------------------------------
ALUMINUM CORPORATION OF CHINA LTD. 2.48%
METAL - ALUMINUM
---------------------------------------------------------------
CHINA LIFE INSURANCE CO., LTD. 2.40%
INSURANCE
---------------------------------------------------------------
CHINA MERCHANTS HOLDINGS INTERNATIONAL CO., LTD. 2.35%
DIVERSIFIED OPERATIONS
---------------------------------------------------------------
CHINA OVERSEAS LAND & INVESTMENT LTD. 2.33%
REAL ESTATE COMPANIES
21
CHINA REGION OPPORTUNITY FUND
PORTFOLIO PROFILE December 31, 2005
Country Distribution* % of Investments
---------------------------------------------------------------
Korea, Republic Of 20.26%
---------------------------------------------------------------
United States 17.67%
---------------------------------------------------------------
Hong Kong 15.46%
---------------------------------------------------------------
Taiwan 12.77%
---------------------------------------------------------------
Canada 11.30%
---------------------------------------------------------------
People's Republic of China 9.80%
---------------------------------------------------------------
Bermuda 4.36%
---------------------------------------------------------------
Japan 3.19%
---------------------------------------------------------------
Other Foreign 5.19%
---------------------------------------------------------------
* Country distribution shown is based on domicile and not
intended to conform to the China region definition in the
prospectus.
22
CHINA REGION OPPORTUNITY FUND
PORTFOLIO ALLOCATION BY INDUSTRY SECTOR
BASED ON TOTAL INVESTMENTS December 31, 2005
[China Region Pie Graph]
Industrials 9.9%
Energy 9.6%
Consumer Discretion 11.2%
Cash Equivalent 5.8%
Telecommunications 2.9%
Other 6.5%
Financials 20.3%
Information Technology 20.3%
Materials 13.5%
23
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, transportation, and processing of
petroleum, natural gas, industrial commodities, metals, minerals,
paper and forest products and can invest in any part of the world.
PERFORMANCE GRAPH
GLOBAL RESOURCES FUND
[Global Resources Fund Graph - 10 year]
Global S&P 500 S&P Energy &
Date Resources Fund Index Materials Index
12/31/1995 $ 10,000.00 $ 10,000.00 $ 10,000.00
1/31/1996 $ 10,367.89 $ 10,340.36 $ 10,189.13
2/29/1996 $ 10,484.95 $ 10,436.23 $ 10,243.51
3/29/1996 $ 11,070.23 $ 10,536.69 $ 10,784.05
4/30/1996 $ 11,722.41 $ 10,692.03 $ 10,992.63
5/31/1996 $ 11,906.35 $ 10,967.78 $ 11,063.35
6/28/1996 $ 11,672.24 $ 11,009.62 $ 10,971.34
7/31/1996 $ 11,170.57 $ 10,523.20 $ 10,595.12
8/30/1996 $ 11,571.91 $ 10,745.19 $ 10,842.04
9/30/1996 $ 12,040.13 $ 11,349.98 $ 11,280.22
10/31/1996 $ 12,608.70 $ 11,663.02 $ 11,787.76
11/29/1996 $ 13,277.59 $ 12,544.59 $ 12,359.03
12/31/1996 $ 13,411.37 $ 12,296.03 $ 12,292.28
1/31/1997 $ 13,903.88 $ 13,064.22 $ 12,813.54
2/28/1997 $ 13,146.17 $ 13,166.61 $ 12,551.68
3/31/1997 $ 13,051.46 $ 12,625.85 $ 12,824.17
4/30/1997 $ 12,710.49 $ 13,379.35 $ 13,011.03
5/30/1997 $ 13,922.82 $ 14,193.93 $ 13,922.37
6/30/1997 $ 13,884.94 $ 14,829.84 $ 14,424.86
7/31/1997 $ 15,059.38 $ 16,009.82 $ 15,481.02
8/29/1997 $ 15,892.85 $ 15,112.92 $ 14,948.67
9/30/1997 $ 17,294.61 $ 15,940.61 $ 15,709.46
10/31/1997 $ 16,385.36 $ 15,408.24 $ 15,005.94
11/28/1997 $ 13,752.34 $ 16,121.52 $ 14,876.46
12/31/1997 $ 13,041.99 $ 16,398.39 $ 14,781.61
1/30/1998 $ 11,493.53 $ 16,579.76 $ 14,190.46
2/27/1998 $ 11,755.24 $ 17,775.57 $ 15,138.71
3/31/1998 $ 11,733.43 $ 18,685.84 $ 15,835.66
4/30/1998 $ 11,428.10 $ 18,873.83 $ 16,403.88
5/29/1998 $ 10,403.06 $ 18,549.43 $ 15,911.08
6/30/1998 $ 9,748.78 $ 19,302.89 $ 15,580.35
7/31/1998 $ 8,985.45 $ 19,097.35 $ 14,568.45
8/31/1998 $ 7,546.03 $ 16,336.31 $ 12,854.75
9/30/1998 $ 8,352.98 $ 17,382.82 $ 14,357.51
10/30/1998 $ 8,658.31 $ 18,796.77 $ 14,625.87
11/30/1998 $ 8,418.41 $ 19,936.00 $ 14,859.40
12/31/1998 $ 8,018.62 $ 21,084.82 $ 14,589.48
1/29/1999 $ 7,622.35 $ 21,966.50 $ 13,743.00
2/26/1999 $ 7,552.42 $ 21,283.81 $ 13,739.64
3/31/1999 $ 8,298.34 $ 22,135.34 $ 15,253.14
4/30/1999 $ 9,673.62 $ 22,992.54 $ 17,906.65
5/28/1999 $ 9,207.42 $ 22,449.57 $ 17,207.06
6/30/1999 $ 9,347.28 $ 23,695.50 $ 17,579.23
7/30/1999 $ 9,370.59 $ 22,955.61 $ 17,651.28
8/31/1999 $ 9,254.04 $ 22,842.05 $ 17,659.43
9/30/1999 $ 8,927.70 $ 22,215.85 $ 17,006.96
10/29/1999 $ 8,741.22 $ 23,621.69 $ 16,948.47
11/30/1999 $ 8,764.53 $ 24,101.88 $ 17,101.44
12/31/1999 $ 9,184.11 $ 25,521.39 $ 17,690.48
1/31/2000 $ 8,881.08 $ 24,239.13 $ 16,862.20
2/29/2000 $ 8,391.58 $ 23,780.29 $ 15,691.86
3/31/2000 $ 9,300.66 $ 26,106.57 $ 17,312.20
4/28/2000 $ 9,160.80 $ 25,321.25 $ 16,983.98
5/31/2000 $ 9,627.00 $ 24,801.73 $ 18,019.74
6/30/2000 $ 9,044.25 $ 25,413.17 $ 16,870.85
7/31/2000 $ 8,881.08 $ 25,015.86 $ 16,633.42
8/31/2000 $ 9,860.10 $ 26,569.70 $ 17,621.39
9/29/2000 $ 9,836.79 $ 25,167.00 $ 17,496.92
10/31/2000 $ 9,463.83 $ 25,060.60 $ 17,755.71
11/30/2000 $ 8,997.63 $ 23,084.84 $ 17,281.98
12/31/2000 $ 10,163.13 $ 23,197.82 $ 18,746.78
1/31/2001 $ 9,836.79 $ 24,020.86 $ 18,208.34
2/28/2001 $ 9,673.62 $ 21,830.60 $ 18,041.98
3/30/2001 $ 9,533.76 $ 20,447.62 $ 17,608.72
4/30/2001 $ 10,396.23 $ 22,036.61 $ 19,421.11
5/31/2001 $ 10,279.68 $ 22,184.25 $ 19,748.88
6/30/2001 $ 9,347.28 $ 21,644.32 $ 18,567.12
7/31/2001 $ 8,974.32 $ 21,431.25 $ 18,361.53
8/31/2001 $ 8,647.99 $ 20,089.62 $ 17,887.70
9/30/2001 $ 8,088.55 $ 18,467.33 $ 16,446.32
10/31/2001 $ 8,624.68 $ 18,819.48 $ 16,935.03
11/30/2001 $ 8,694.61 $ 20,263.05 $ 17,092.27
12/31/2001 $ 8,787.84 $ 20,440.57 $ 17,609.67
1/31/2002 $ 8,811.15 $ 20,142.28 $ 17,476.68
2/28/2002 $ 9,300.66 $ 19,753.83 $ 18,292.63
3/31/2002 $ 10,163.13 $ 20,496.75 $ 19,336.13
4/30/2002 $ 10,792.50 $ 19,254.08 $ 18,369.45
5/31/2002 $ 12,983.63 $ 19,112.23 $ 18,739.63
6/30/2002 $ 11,491.80 $ 17,750.69 $ 18,592.88
7/31/2002 $ 8,927.70 $ 16,367.11 $ 16,313.26
8/31/2002 $ 9,370.59 $ 16,474.57 $ 16,303.92
9/30/2002 $ 9,184.11 $ 14,684.12 $ 14,693.28
10/31/2002 $ 8,578.06 $ 15,976.56 $ 15,218.90
11/30/2002 $ 8,904.39 $ 16,916.93 $ 16,164.79
12/31/2002 $ 10,350.77 $ 15,923.09 $ 15,964.13
1/31/2003 $ 10,945.64 $ 15,505.97 $ 15,439.09
2/28/2003 $ 11,159.79 $ 15,273.32 $ 15,546.78
3/31/2003 $ 10,779.08 $ 15,421.61 $ 15,686.38
4/30/2003 $ 10,755.28 $ 16,691.89 $ 16,079.74
5/31/2003 $ 12,016.41 $ 17,571.34 $ 17,202.72
6/30/2003 $ 12,230.56 $ 17,795.50 $ 17,123.99
7/31/2003 $ 12,825.43 $ 18,109.25 $ 17,237.51
8/31/2003 $ 14,443.48 $ 18,462.43 $ 18,150.07
9/30/2003 $ 15,204.92 $ 18,266.37 $ 17,591.57
10/31/2003 $ 17,727.18 $ 19,299.70 $ 18,184.29
11/30/2003 $ 19,131.07 $ 19,469.50 $ 18,360.04
12/31/2003 $ 20,656.08 $ 20,490.57 $ 20,702.06
1/31/2004 $ 20,221.22 $ 20,866.67 $ 20,589.16
2/29/2004 $ 21,284.22 $ 21,156.71 $ 21,557.20
3/31/2004 $ 21,839.88 $ 20,837.53 $ 21,339.19
4/30/2004 $ 19,713.88 $ 20,510.41 $ 21,284.85
5/31/2004 $ 19,738.04 $ 20,791.88 $ 21,527.31
6/30/2004 $ 20,269.54 $ 21,196.17 $ 22,639.67
7/31/2004 $ 20,366.17 $ 20,494.65 $ 23,029.69
8/31/2004 $ 20,414.49 $ 20,577.55 $ 23,002.04
9/30/2004 $ 23,337.75 $ 20,800.41 $ 24,624.61
10/31/2004 $ 24,038.37 $ 21,118.19 $ 24,685.77
11/30/2004 $ 27,058.26 $ 21,972.66 $ 26,321.14
12/31/2004 $ 26,938.11 $ 22,720.36 $ 26,068.55
1/31/2005 $ 27,117.52 $ 22,166.55 $ 26,325.91
2/28/2005 $ 32,500.02 $ 22,633.03 $ 30,391.68
3/31/2005 $ 32,115.55 $ 22,232.24 $ 29,386.09
4/30/2005 $ 29,654.98 $ 21,810.60 $ 27,677.72
5/31/2005 $ 29,988.19 $ 22,504.58 $ 27,948.58
6/30/2005 $ 32,474.39 $ 22,536.52 $ 28,937.57
7/31/2005 $ 34,627.38 $ 23,374.62 $ 30,574.66
8/31/2005 $ 36,934.17 $ 23,161.35 $ 31,366.19
9/30/2005 $ 40,035.51 $ 23,348.94 $ 32,767.58
10/31/2005 $ 36,575.34 $ 22,959.69 $ 30,674.71
11/30/2005 $ 37,856.88 $ 23,828.08 $ 31,729.04
12/31/2005 $ 40,130.12 $ 23,836.25 $ 32,129.57
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2005
Six Month One Year Five Year Ten Year
Global Resources Fund 23.57% 48.97% 31.59% 14.89%
-----------------------------------------------------------------------
S&P 500 Index 5.77% 4.91% 0.54% 9.06%
-----------------------------------------------------------------------
S&P Energy and Materials
Index 11.03% 23.25% 11.37% 12.37%
Performance data quoted above is historical. Past performance is no
guarantee of future results. Current performance may be higher or lower
than the performance data quoted. 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 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.
24
GLOBAL RESOURCES FUND
PERFORMANCE COMMENTARY
The Global Resources Fund outperformed the S&P 500 Index and the S&P
Energy and Materials Index for the six-month, one-year, five-year
and ten-year periods ended December 31, 2005.
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED
THE FUND
Critical drivers for the six-month period included:
* Strong global demand, particularly from China, helped drive the
Reuters/Jeffries CRB Futures Price Index(1) to record levels.
* Institutional fund buying for commodities accelerated in the past
six months, as investors seek higher returns and diversification
from financial assets and the inflationary effects of a
depreciating U.S. Dollar.
* Historically low spare production capacity and rising emerging
market demand for crude oil continues to amplify geo-political
tensions in oil exporting countries, which supports higher oil
prices.
* The devastating impact of Hurricanes Katrina and Rita, which
destroyed much of New Orleans and crippled energy production from
the Gulf of Mexico, has prompted one of the largest reconstruction
efforts in U.S. history, with costs estimated to be as high as
$200 billion.
* The Fed continued to tighten monetary policy in the second half of
2005; raising the benchmark Fed Funds rate four times to finish
the year at 4.25 percent.
* Congress passed the $286 billion Highway Bill in the third
quarter, further driving the demand for raw materials and
industrial equipment.
The economy slowed in the fourth quarter as GDP fell to just 1.1
percent after posting a very strong gain of 4.1 percent in the prior
quarter. The report also brought to an end a string of ten
consecutive quarters of at least 3 percent growth. Further, the
economy's decline in the fourth quarter may point towards a more
sustained period of moderate growth, as higher interest rates and
rising energy costs may have finally dampened household consumption.
However, there are expectations for a rebound in the first quarter
due to recent strength in employment data, an increase in December's
durable goods orders and healthy manufacturing (PMI) data reported
earlier in the quarter. Interestingly, slower output in the fourth
quarter was also met with an increase in inflation. The core
personal consumption expenditures (PCE) index, which is the Fed's
preferred measure of inflation, jumped to 2.2 percent, above the
acceptable 1-2 percent target previously outlined by incoming Fed
Chairman Ben Bernanke. Additionally, the CPI spiked in September and
October to critically high levels of 4.7 percent and 4.3 percent,
respectively. All of
25
GLOBAL RESOURCES FUND
these factors could set the stage for further rate increases by the Fed well
into 2006, but at this point, most economists still view the rise in
inflation as transitory and within manageable levels.
Strong economic development in emerging countries such as Brazil,
Russia, India and China in particular, account for nearly 24 percent
of global GDP and continues to be the engine of growth for the
worldwide economy. These aforementioned "BRIC" economies grew by an
average of 6.7 percent in 2005 or nearly double the U.S. economy's
3.5 percent over the same period. Moreover, China's economic growth
seems to have accelerated in 2005 with domestic GDP climbing to a
recently revised 9.9 percent, which exceeded most forecasts at the
start of the year calling for sub-9 percent growth. Accordingly,
China's Industrial Production and Fixed Asset Investment levels,
which are key benchmarks for commodities, remained at robust levels
of approximately 16 percent and 26 percent, respectively, through
the first nine months of 2005.
INVESTMENT HIGHLIGHTS
STRENGTHS
* The fund benefited from a 19 percent increase in the price of gold
during the period with the Philadelphia Stock Exchange Gold &
Silver Index(2) gaining nearly 40 percent.
* Base metal inventories declined globally, driving prices for
Copper ($2.01/lb), Aluminum ($1.04/lb) and Zinc ($0.90/lb) to new
52-week highs. As a result, the S&P/TSX Metals & Mining Index(3)
gained 35 percent.
* Natural gas stocks helped fund performance during the period due
to strong New York Mercantile Exchange (NYMEX) prices that reached
$15 per thousand cubic feet on fears that winter storage would be
inadequate.
* Oil prices gained another 8 percent over the past two quarters
from $56.50 a barrel to $61.04 a barrel; the AMEX Oil Index(4)
increased 12 percent.
* A decline in the U.S. Dollar enhanced Canadian equity performance
as the S&P/TSX Capped Energy Trust Index(5) in U.S. Dollar terms,
outperformed the Canadian dollar return by 7.1 percent.
* The fund maintained a large position in oil service and equipment
stocks; this sector gained 25% during the period due to a rising
rig count, higher day-rates and improving margins.
26
GLOBAL RESOURCES FUND
WEAKNESSES
* Oil and gas operating costs were estimated to have increased by 20
percent annually in the third quarter, which compressed profit
margins and weighed on quarterly earnings reports.
* New capacity expansions in the second half of the year were
constrained by labor issues, transportation bottlenecks,
permitting delays, equipment shortages and higher capital costs.
* Despite a strong recovery in ethylene pricing, chemical stocks
could not gain traction during the period as the industry was
struggling with plant outages on the gulf coast and rising
feedstock costs.
* The fund did not fully participate in the strong rally for steel
stocks during the period, mainly due to rapidly growing steel
capacity in China, which could have weakened prices.
* Poor industry fundamentals limited the fund's exposure to forest
and paper stocks, which outperformed briefly in the second half
due to merger and acquisition activity.
CURRENT OUTLOOK
OPPORTUNITIES
* Despite significantly higher crude oil prices, the International
Energy Agency (IEA) forecasts global demand growth to increase by
2.2 percent or 1.8 million barrels a day in 2006.
* According to the U.S. Interior Department, a total of 108
low-producing oil and gas offshore platforms were destroyed by
Hurricanes Rita and Katrina, while some of the other 53 heavily
damaged platforms could be offline well into next year, further
constraining oil and gas supply from the Gulf of Mexico.
* Refining margins should remain strong this year due to very high
utilization rates necessary to meet rising demand, a heavy
maintenance turnaround season and the introduction of stricter low
sulfur requirements, which would limit imports.
* Copper fundamentals remain favorable despite calls for a surplus
in capacity in 2006. Production shortfalls should continue, in our
opinion, due to labor shortages, union issues, permitting delays
and equipment constraints.
* The International Lead and Zinc Study Group said in their 2005
survey they see strong zinc demand from China (9 percent), India
(9.2 percent) and Korea (6.4 percent) being offset by declines in
the United States and Europe. Total demand in 2006 is forecast to
rise by 5.7 percent to 11.12 million metric tons.
27
GLOBAL RESOURCES FUND
* Coal inventories at U.S. utilities should end the year at the
lowest level in decades, further supporting strong pricing for the
next several years.
* According to a recent industry survey, oil and gas exploration and
production (E&P) spending growth will exceed last year's record
levels, with expenditures expected to rise by about 15 percent in
2006 vs. 2005.
THREATS
* There is a risk that the new Fed Chairman Ben Bernanke could
become overly aggressive and raise short term interest too much,
which would negatively impact U.S. housing/consumption and China's
export led economy.
* China's economy could also slow down due to excessive speculation
in real estate investment, which would suppress demand for
commodities and other capital goods.
* Junior energy and mining exploration companies whose prospects are
heavily dependent on new projects, may experience significant
production delays due to constraints for raw materials, equipment
(trucks, pumps and tires), skilled labor and engineers.
* Rising commodity prices and higher corporate profits are garnering
more attention from labor unions and developing countries who are
demanding higher wages and stronger production sharing contracts
and increased tax rates. In fact, in some countries such as
Bolivia, newly-elected president Evo Morales has pledged to
nationalize the country's natural gas industry.
(1)The Reuters/Jeffries CRB Futures Price Index is an arithmetic
average of commodity futures prices with monthly rebalancing.
(2)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.
(3)The S&P/TSX Metals & Mining Index is a modified
capitalization-weighted index, whose equity weights are capped at
25 percent and index constituents are derived from a subset stock
pool of S&P/TSX Composite Index stocks.
(4)The AMEX Oil Index is a price-weighted index of the leading
companies involved in the exploration, production, and
development of petroleum.
(5)The S&P/TSX Capped Energy Trust Index is a modified-market cap
weighted index and represents a subset of the broad-based
composite Index, in this case the Energy GICS sector of the
income trust marketplace. Each constituent energy income trust
will have its relative weight capped at 25 percent.
28
GLOBAL RESOURCES FUND
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2005
PETROLEO BRASILEIRO S.A. 2.87%
OIL & GAS - INTEGRATED
---------------------------------------------------------------
VALERO ENERGY CORP. 2.76%
OIL & GAS REFINING & MARKETING
---------------------------------------------------------------
WHITE NILE LTD. 2.74%
OIL & GAS EXPLORATION & PRODUCTION - JUNIOR
---------------------------------------------------------------
NATIONAL-OILWELL, INC. 2.04%
OIL & GAS EQUIPMENT & SERVICES
---------------------------------------------------------------
SUNOCO, INC. 2.00%
OIL & GAS REFINING & MARKETING
---------------------------------------------------------------
SILVER WHEATON CORP. 1.81%
SILVER MINING
---------------------------------------------------------------
GOLDCORP, INC. 1.73%
GOLD MINING
---------------------------------------------------------------
GRANT PRIDECO, INC. 1.52%
OIL & GAS EQUIPMENT & SERVICES
---------------------------------------------------------------
TECK COMINCO LTD. 1.49%
GENERAL METAL & MINERAL MINING
---------------------------------------------------------------
NORTHERN ORION RESOURCES, INC. 1.49%
GOLD & COPPER MINING
PORTFOLIO PROFILE December 31, 2005
Country Distribution* % of Investments
---------------------------------------------------------------
Canada 46.94%
---------------------------------------------------------------
United States 40.16%
---------------------------------------------------------------
United Kingdom 4.13%
---------------------------------------------------------------
Brazil 2.87%
---------------------------------------------------------------
Bermuda 2.49%
---------------------------------------------------------------
Other Foreign 3.41%
---------------------------------------------------------------
* Country distribution shown is based on domicile and the
locale of company operations may be different.
29
GLOBAL RESOURCES FUND
PORTFOLIO ALLOCATION BY INDUSTRY SECTOR
BASED ON TOTAL INVESTMENTS December 31, 2005
[Global Resources Fund Pie Graph]
Cash Equivalent 4.0%
Oil & Gas Exploration & Production 18.5%
Oil & Gas Equipment & Services 15.1%
Oil & Gas - Integrated 12.5%
Oil & Gas Royalty Trusts 9.1%
Oil & Gas Drilling 7.7%
Metals & Mining 16.1%
Gold 11.4%
Other Basic Materials 2.9%
Other Sectors 2.7%
Energy:
Oil & Gas Exploration & Production 18.5%
Oil & Gas Equipment & Services 15.1%
Oil & Gas - Integrated (includes 12.5%
Refining and Marketing)
Oil & Gas Royalty Trusts 9.1%
Oil & Gas Drilling 7.7%
Total Energy 62.9%
Basic Materials:
Metals & Mining (includes Copper, 16.1%
Platinum Group Metals, Zinc, Nickel
and Coal)
Gold (includes Gold Mining, Silver 11.4%
Mining and Gold & Copper Mining)
Other Basic Materials 2.9%
Total Basic Materials 30.4%
Other Sectors 2.7%
Cash Equivalent 4.0%
-----
Total Investments 100.0%
=====
30
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 GRAPHS
WORLD PRECIOUS MINERALS FUND
[World Precious Minerals Fund Graph]
World Precious S&P 500 AMEX Gold
Date Minerals Fund Index BUGS Index*
12/31/1995 $10,000.00 $10,000.00 $10,000.00
1/31/1996 $11,615.57 $10,340.36 $12,082.57
2/29/1996 $11,928.07 $10,436.23 $12,406.63
3/29/1996 $12,564.86 $10,536.69 $12,084.34
4/30/1996 $12,954.01 $10,692.03 $12,294.30
5/31/1996 $14,274.76 $10,967.78 $12,670.71
6/28/1996 $12,452.83 $11,009.62 $10,874.55
7/31/1996 $12,134.43 $10,523.20 $10,571.66
8/30/1996 $13,242.92 $10,745.19 $10,822.80
9/30/1996 $12,853.77 $11,349.98 $10,081.75
10/31/1996 $12,517.69 $11,663.02 $ 9,856.50
11/29/1996 $12,317.22 $12,544.59 $ 9,901.19
12/31/1996 $11,951.65 $12,296.03 $ 9,568.90
1/31/1997 $11,284.20 $13,064.22 $ 9,235.43
2/28/1997 $12,431.96 $13,166.61 $10,638.71
3/31/1997 $10,947.36 $12,625.85 $ 9,423.04
4/30/1997 $10,410.91 $13,379.35 $ 8,413.81
5/30/1997 $10,972.31 $14,193.93 $ 8,910.78
6/30/1997 $ 9,949.31 $14,829.84 $ 8,633.18
7/31/1997 $ 9,475.24 $16,009.82 $ 8,572.60
8/29/1997 $ 9,699.80 $15,112.92 $ 8,520.26
9/30/1997 $10,111.50 $15,940.61 $ 9,216.02
10/31/1997 $ 8,414.81 $15,408.24 $ 7,173.44
11/28/1997 $ 6,674.46 $16,121.52 $ 5,871.90
12/31/1997 $ 7,041.87 $16,398.39 $ 5,658.41
1/30/1998 $ 7,648.16 $16,579.76 $ 5,739.58
2/27/1998 $ 7,243.97 $17,775.57 $ 5,897.19
3/31/1998 $ 7,736.58 $18,685.84 $ 6,434.75
4/30/1998 $ 8,058.68 $18,873.83 $ 6,929.95
5/29/1998 $ 6,915.56 $18,549.43 $ 5,831.32
6/30/1998 $ 6,227.16 $19,302.89 $ 5,357.29
7/31/1998 $ 5,791.38 $19,097.35 $ 4,775.04
8/31/1998 $ 4,528.27 $16,336.31 $ 3,578.78
9/30/1998 $ 6,252.42 $17,382.82 $ 5,248.49
10/30/1998 $ 6,170.32 $18,796.77 $ 4,913.25
11/30/1998 $ 5,759.81 $19,936.00 $ 4,598.01
12/31/1998 $ 5,931.59 $21,084.82 $ 3,979.30
1/29/1999 $ 5,678.64 $21,966.50 $ 3,958.13
2/26/1999 $ 5,558.49 $21,283.81 $ 3,914.02
3/31/1999 $ 5,444.67 $22,135.34 $ 3,765.22
4/30/1999 $ 6,096.00 $22,992.54 $ 4,550.96
5/28/1999 $ 4,983.04 $22,449.57 $ 3,869.91
6/30/1999 $ 4,926.13 $23,695.50 $ 4,111.04
7/30/1999 $ 4,647.89 $22,955.61 $ 3,941.66
8/31/1999 $ 4,843.92 $22,842.05 $ 4,148.68
9/30/1999 $ 6,102.33 $22,215.85 $ 5,088.51
10/29/1999 $ 5,476.29 $23,621.69 $ 4,682.11
11/30/1999 $ 5,235.99 $24,101.88 $ 4,422.16
12/31/1999 $ 5,179.07 $25,521.39 $ 4,353.94
1/31/2000 $ 4,597.30 $24,239.13 $ 3,871.67
2/29/2000 $ 4,673.18 $23,780.29 $ 3,953.42
3/31/2000 $ 4,319.06 $26,106.57 $ 3,659.94
4/28/2000 $ 4,104.05 $25,321.25 $ 3,466.45
5/31/2000 $ 3,977.58 $24,801.73 $ 3,357.64
6/30/2000 $ 4,066.11 $25,413.17 $ 3,429.98
7/31/2000 $ 3,636.10 $25,015.86 $ 2,917.13
8/31/2000 $ 3,781.55 $26,569.70 $ 2,980.65
9/29/2000 $ 3,395.80 $25,167.00 $ 2,748.93
10/31/2000 $ 3,035.35 $25,060.60 $ 2,271.95
11/30/2000 $ 3,003.74 $23,084.84 $ 2,478.39
12/31/2000 $ 3,206.73 $23,197.82 $ 2,409.57
1/31/2001 $ 3,174.98 $24,020.86 $ 2,804.80
2/28/2001 $ 3,168.63 $21,830.60 $ 3,237.66
3/30/2001 $ 2,959.08 $20,447.62 $ 2,924.19
4/30/2001 $ 3,238.48 $22,036.61 $ 3,299.42
5/31/2001 $ 3,365.47 $22,184.25 $ 3,687.00
6/30/2001 $ 3,352.77 $21,644.32 $ 3,724.05
7/31/2001 $ 3,162.28 $21,431.25 $ 3,575.25
8/31/2001 $ 3,206.73 $20,089.62 $ 3,877.55
9/30/2001 $ 3,390.87 $18,467.33 $ 4,223.37
10/31/2001 $ 3,346.42 $18,819.48 $ 3,991.65
11/30/2001 $ 3,327.38 $20,263.05 $ 3,761.69
12/31/2001 $ 3,448.02 $20,440.57 $ 3,834.62
1/31/2002 $ 4,051.27 $20,142.28 $ 4,473.33
2/28/2002 $ 4,438.62 $19,753.83 $ 5,072.63
3/31/2002 $ 5,162.51 $20,496.75 $ 5,810.74
4/30/2002 $ 5,702.26 $19,254.08 $ 6,323.00
5/31/2002 $ 8,026.34 $19,112.23 $ 8,317.94
6/30/2002 $ 6,623.00 $17,750.69 $ 7,465.74
7/31/2002 $ 4,762.46 $16,367.11 $ 6,313.59
8/31/2002 $ 5,422.86 $16,474.57 $ 7,565.72
9/30/2002 $ 5,460.96 $14,684.12 $ 7,406.93
10/31/2002 $ 4,737.06 $15,976.56 $ 6,515.91
11/30/2002 $ 4,787.86 $16,916.93 $ 6,818.21
12/31/2002 $ 6,324.31 $15,923.09 $ 8,534.96
1/31/2003 $ 6,565.55 $15,505.97 $ 8,474.39
2/28/2003 $ 6,324.31 $15,273.32 $ 7,772.75
3/31/2003 $ 5,959.20 $15,421.61 $ 7,276.95
4/30/2003 $ 5,802.72 $16,691.89 $ 7,333.41
5/31/2003 $ 6,226.51 $17,571.34 $ 8,323.24
6/30/2003 $ 6,356.91 $17,795.50 $ 8,789.63
7/31/2003 $ 6,767.67 $18,109.25 $ 9,647.71
8/31/2003 $ 7,934.73 $18,462.43 $11,397.40
9/30/2003 $ 8,547.60 $18,266.37 $11,488.56
10/31/2003 $10,457.93 $19,299.70 $12,713.05
11/30/2003 $12,185.71 $19,469.50 $14,610.95
12/31/2003 $12,186.84 $20,490.57 $14,287.48
1/31/2004 $11,309.04 $20,866.67 $12,681.88
2/29/2004 $11,806.46 $21,156.71 $13,221.20
3/31/2004 $12,837.88 $20,837.53 $13,873.43
4/30/2004 $10,036.22 $20,510.41 $10,514.62
5/31/2004 $10,365.40 $20,791.88 $11,758.51
6/30/2004 $10,006.96 $21,196.17 $11,112.16
7/31/2004 $ 9,524.17 $20,494.65 $10,942.19
8/31/2004 $ 9,933.81 $20,577.55 $12,197.26
9/30/2004 $11,469.97 $20,800.41 $13,608.19
10/31/2004 $11,733.31 $21,118.19 $13,738.75
11/30/2004 $12,830.56 $21,972.66 $13,935.19
12/31/2004 $12,304.59 $22,720.36 $12,664.24
1/31/2005 $11,665.29 $22,166.55 $11,854.97
2/28/2005 $12,868.67 $22,633.03 $12,663.65
3/31/2005 $12,266.98 $22,232.24 $11,872.02
4/30/2005 $10,612.33 $21,810.60 $10,470.51
5/31/2005 $10,574.72 $22,504.58 $10,926.31
6/30/2005 $11,657.77 $22,536.52 $11,854.38
7/31/2005 $11,725.46 $23,374.62 $11,572.66
8/31/2005 $12,439.97 $23,161.35 $12,114.92
9/30/2005 $14,199.91 $23,348.94 $14,420.40
10/31/2005 $13,011.57 $22,959.69 $13,105.92
11/30/2005 $14,312.73 $23,828.08 $14,317.47
12/31/2005 $16,104.98 $23,836.25 $16,285.36
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2005
Six Month One Year Five Year Ten Year
World Precious Minerals Fund 38.15% 30.89% 38.07% 4.88%
------------------------------------------------------------------------
S&P 500 Index 5.77% 4.91% 0.54% 9.06%
------------------------------------------------------------------------
AMEX Gold BUGS Index* 37.38% 28.59% 46.48% 4.99%
<FN>
*These are not total returns. These returns reflect simple appreciation
only and do not reflect dividend reinvestment.
Performance data quoted above is historical. Past performance is no
guarantee of future results. Current performance may be higher or lower
than the performance data quoted. 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 Index is a widely recognized capitalization-weighted index
of 500 common stock prices in U.S. companies. The AMEX Gold BUGS Index
is a modified equal-dollar weighted index of companies involved in major
gold mining that do not hedge their gold production beyond 1 1/2 years.
</FN>
31
GOLD AND PRECIOUS MINERALS FUND
GOLD SHARES FUND
[Gold Shares Fund Graph]
Gold Shares S&P 500 Philadelphia Stock Exchange
Date Fund Index Gold & Silver Index
12/29/1995 $10,000.00 $10,000.00 $10,000.00
1/31/1996 $12,216.49 $10,340.36 $11,713.99
2/29/1996 $11,855.67 $10,436.23 $11,973.28
3/29/1996 $11,185.57 $10,536.69 $11,961.44
4/30/1996 $11,237.11 $10,692.03 $11,930.29
5/31/1996 $11,546.39 $10,967.78 $12,408.28
6/28/1996 $ 9,587.63 $11,009.62 $10,315.87
7/31/1996 $ 9,483.42 $10,523.20 $10,371.04
8/30/1996 $ 9,431.31 $10,745.19 $10,397.32
9/30/1996 $ 8,597.60 $11,349.98 $ 9,615.12
10/31/1996 $ 8,441.28 $11,663.02 $ 9,652.67
11/29/1996 $ 7,868.11 $12,544.59 $10,054.01
12/31/1996 $ 7,451.26 $12,296.03 $ 9,772.10
1/31/1997 $ 6,706.13 $13,064.22 $ 9,225.77
2/28/1997 $ 7,664.15 $13,166.61 $10,259.71
3/31/1997 $ 6,599.68 $12,625.85 $ 8,729.27
4/30/1997 $ 6,067.45 $13,379.35 $ 7,871.58
5/30/1997 $ 6,173.90 $14,193.93 $ 8,764.61
6/30/1997 $ 5,130.72 $14,829.84 $ 8,039.07
7/31/1997 $ 5,239.89 $16,009.82 $ 8,242.28
8/29/1997 $ 5,294.47 $15,112.92 $ 8,329.17
9/30/1997 $ 5,185.30 $15,940.61 $ 9,224.68
10/31/1997 $ 4,039.08 $15,408.24 $ 7,408.34
11/28/1997 $ 3,111.18 $16,121.52 $ 5,984.97
12/31/1997 $ 3,176.68 $16,398.39 $ 6,271.34
1/30/1998 $ 3,176.68 $16,579.76 $ 6,337.27
2/27/1998 $ 2,898.02 $17,775.57 $ 6,381.85
3/31/1998 $ 2,953.76 $18,685.84 $ 6,911.84
4/30/1998 $ 3,120.95 $18,873.83 $ 7,443.99
5/29/1998 $ 2,507.91 $18,549.43 $ 6,334.01
6/30/1998 $ 2,112.21 $19,302.89 $ 6,081.81
7/31/1998 $ 2,128.93 $19,097.35 $ 5,339.41
8/31/1998 $ 1,638.50 $16,336.31 $ 4,153.90
9/30/1998 $ 2,284.98 $17,382.82 $ 6,371.46
10/30/1998 $ 2,234.82 $18,796.77 $ 6,410.82
11/30/1998 $ 2,095.49 $19,936.00 $ 6,043.36
12/31/1998 $ 2,128.93 $21,084.82 $ 5,534.58
1/29/1999 $ 2,034.19 $21,966.50 $ 5,388.91
2/26/1999 $ 1,989.61 $21,283.81 $ 5,160.48
3/31/1999 $ 1,978.46 $22,135.34 $ 5,100.08
4/30/1999 $ 2,201.38 $22,992.54 $ 6,273.59
5/28/1999 $ 1,855.85 $22,449.57 $ 5,214.11
6/30/1999 $ 1,906.01 $23,695.50 $ 5,733.20
7/30/1999 $ 1,783.40 $22,955.61 $ 5,385.43
8/31/1999 $ 1,878.14 $22,842.05 $ 5,828.83
9/30/1999 $ 2,390.87 $22,215.85 $ 6,947.16
10/29/1999 $ 2,140.08 $23,621.69 $ 6,021.59
11/30/1999 $ 2,050.91 $24,101.88 $ 5,814.26
12/31/1999 $ 2,073.20 $25,521.39 $ 5,894.92
1/31/2000 $ 1,822.41 $24,239.13 $ 5,201.97
2/29/2000 $ 1,833.56 $23,780.29 $ 5,220.90
3/31/2000 $ 1,694.23 $26,106.57 $ 4,940.95
4/28/2000 $ 1,560.47 $25,321.25 $ 4,787.92
5/31/2000 $ 1,560.47 $24,801.73 $ 4,941.51
6/30/2000 $ 1,627.35 $25,413.17 $ 5,077.00
7/31/2000 $ 1,471.30 $25,015.86 $ 4,465.78
8/31/2000 $ 1,560.47 $26,569.70 $ 4,628.09
9/29/2000 $ 1,460.16 $25,167.00 $ 4,415.10
10/31/2000 $ 1,315.26 $25,060.60 $ 3,880.03
11/30/2000 $ 1,337.55 $23,084.84 $ 4,181.57
12/31/2000 $ 1,454.59 $23,197.82 $ 4,567.16
1/31/2001 $ 1,437.87 $24,020.86 $ 4,340.62
2/28/2001 $ 1,471.30 $21,830.60 $ 4,691.60
3/30/2001 $ 1,337.55 $20,447.62 $ 4,251.57
4/30/2001 $ 1,515.89 $22,036.61 $ 4,927.25
5/31/2001 $ 1,582.77 $22,184.25 $ 5,116.46
6/30/2001 $ 1,577.19 $21,644.32 $ 4,770.10
7/31/2001 $ 1,460.16 $21,431.25 $ 4,753.12
8/31/2001 $ 1,499.17 $20,089.62 $ 5,088.07
9/30/2001 $ 1,560.47 $18,467.33 $ 5,199.88
10/31/2001 $ 1,538.18 $18,819.48 $ 4,907.84
11/30/2001 $ 1,527.04 $20,263.05 $ 4,742.53
12/31/2001 $ 1,616.21 $20,440.57 $ 4,912.28
1/31/2002 $ 1,883.72 $20,142.28 $ 5,535.00
2/28/2002 $ 2,156.80 $19,753.83 $ 5,901.53
3/31/2002 $ 2,463.32 $20,496.75 $ 6,424.12
4/30/2002 $ 2,708.54 $19,254.08 $ 6,702.33
5/31/2002 $ 3,589.09 $19,112.23 $ 7,653.66
6/30/2002 $ 2,942.61 $17,750.69 $ 6,495.20
7/31/2002 $ 2,173.52 $16,367.11 $ 5,502.67
8/31/2002 $ 2,513.48 $16,474.57 $ 6,361.28
9/30/2002 $ 2,585.93 $14,684.12 $ 6,387.72
10/31/2002 $ 2,229.25 $15,976.56 $ 5,810.68
11/30/2002 $ 2,251.54 $16,916.93 $ 5,805.18
12/31/2002 $ 2,931.46 $15,923.09 $ 7,041.72
1/31/2003 $ 3,003.91 $15,505.97 $ 7,063.74
2/28/2003 $ 2,814.43 $15,273.32 $ 6,646.83
3/31/2003 $ 2,636.09 $15,421.61 $ 6,184.03
4/30/2003 $ 2,519.05 $16,691.89 $ 6,036.81
5/31/2003 $ 2,803.28 $17,571.34 $ 6,800.24
6/30/2003 $ 2,886.88 $17,795.50 $ 7,282.95
7/31/2003 $ 3,037.35 $18,109.25 $ 7,513.52
8/31/2003 $ 3,533.36 $18,462.43 $ 8,458.50
9/30/2003 $ 3,689.41 $18,266.37 $ 8,474.67
10/31/2003 $ 4,263.44 $19,299.70 $ 9,124.97
11/30/2003 $ 5,065.97 $19,469.50 $10,210.09
12/31/2003 $ 4,897.79 $20,490.57 $10,136.92
1/31/2004 $ 4,344.27 $20,866.67 $ 8,909.75
2/29/2004 $ 4,506.41 $21,156.71 $ 9,320.65
3/31/2004 $ 4,942.51 $20,837.53 $ 9,809.63
4/30/2004 $ 3,796.34 $20,510.41 $ 7,663.68
5/31/2004 $ 4,103.85 $20,791.88 $ 8,411.82
6/30/2004 $ 3,913.76 $21,196.17 $ 8,082.50
7/31/2004 $ 3,684.52 $20,494.65 $ 8,151.08
8/31/2004 $ 3,885.80 $20,577.55 $ 8,898.88
9/30/2004 $ 4,444.91 $20,800.41 $ 9,577.58
10/31/2004 $ 4,500.82 $21,118.19 $ 9,721.49
11/30/2004 $ 4,841.87 $21,972.66 $10,048.03
12/31/2004 $ 4,582.51 $22,720.36 $ 9,357.02
1/31/2005 $ 4,363.23 $22,166.55 $ 8,614.13
2/28/2005 $ 4,666.85 $22,633.03 $ 9,340.97
3/31/2005 $ 4,374.47 $22,232.24 $ 8,865.56
4/30/2005 $ 3,800.95 $21,810.60 $ 7,904.54
5/31/2005 $ 3,885.30 $22,504.58 $ 8,178.41
6/30/2005 $ 4,312.62 $22,536.52 $ 8,817.70
7/31/2005 $ 4,346.36 $23,374.62 $ 8,610.18
8/31/2005 $ 4,638.74 $23,161.35 $ 9,100.06
9/30/2005 $ 5,302.22 $23,348.94 $10,745.84
10/31/2005 $ 4,976.10 $22,959.69 $10,129.23
11/30/2005 $ 5,386.56 $23,828.08 $10,925.50
12/31/2005 $ 6,085.50 $23,836.25 $12,215.73
AVERAGE ANNUAL PERFORMANCE For the Periods Ended
December 31, 2005
Six Month One Year Five Year Ten Year
Gold Shares Fund 41.11% 32.80% 33.12% (4.84)%
-------------------------------------------------------------------------
S&P 500 Index 5.77% 4.91% 0.54% 9.06%
-------------------------------------------------------------------------
Philadelphia Stock Exchange
Gold & Silver Index 38.54% 30.55% 21.72% 2.02%
Performance data quoted above is historical. Past performance is no
guarantee of future results. Current performance may be higher or lower
than the performance data quoted. 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 Index is a widely recognized capitalization-weighted index of
500 common stock prices in U.S. companies. 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.
PERFORMANCE COMMENTARY
The World Precious Minerals Fund outperformed the S&P 500 Index and
the AMEX Gold BUGS Index for the six-month and one-year periods
ended December 31, 2005. The Gold Shares Fund outperformed the S&P
500 Index and the Philadelphia Stock Exchange Gold & Silver Index
for the six-month, one-year and five-year periods ended December 31,
2005.
32
GOLD AND PRECIOUS MINERALS FUNDS
SIX MONTHS IN REVIEW - ECONOMIC AND POLITICAL ISSUES THAT AFFECTED THE FUND
Critical drivers for the six-months include:
* Major gold producers are reporting a declining production profile.
* Total production costs are climbing due to currency effects,
higher labor cost, rising G&A, higher royalties at higher gold
prices, and bigger exploration budgets.
* Resource and reserve quality have fallen. Despite that greater
volumes of ore have been processed at the mines; the average grade
of the ore has fallen close to 20 percent over the last five
years.
* Declining production combined with higher cost has lowered the
profitability of the gold industry, particularly when investors
have been looking for higher profits to be achieved.
* Venezuela, Mongolia, and Russia announced, proposed or implemented
changes regarding natural resource investments within their
borders, thus making it more difficult for foreign companies to
develop mineral deposits in these regions.
* Investment demand for gold has grown substantially over the last
six months despite the rise in price to $517.00; a gain of 18.71
percent. For the streetTRACKS Gold Trust(1) exchange-traded fund
(ETF), assets invested in gold have climbed by 76.2 percent to
$4.34 billion in the last six months.
INVESTMENT HIGHLIGHTS
STRENGTHS
* Spot gold closed at $517.00, up $81.50 or 18.71 percent over the
last 6-months while copper rose to $2.04 per pound, a gain of
54.93 percent for the same period.
* Despite the U.S. Trade-Weighted Dollar Index(2) rising 2.22
percent over the past six months, gold remained very strong. A
gold trader at RBC Capital Markets commented that gold is now
trading on its own merits, not so much as a hedge on the Dollar
but, as another alternative to currencies.
* At the London Bullion Market Association's Precious Metals
Conference held in November, Maria Gueguina, Head of External
Reserves Management for the Russian Central bank, made a statement
that they want to raise their gold holdings to 10 percent of their
reserves.
33
GOLD AND PRECIOUS MINERALS FUNDS
WEAKNESSES
* Although gold bullion was strong, the share price performance of
the gold mining shares lacked their typical 3-to-1 leverage factor
to price changes in gold.
* A continued trend in quarter-over-quarter rising costs profiled in
the gold industry is offsetting any profit growth from a higher
gold price for gold producers and has hurt returns.
* Lihir Gold Ltd.,(3) Australia's second largest listed gold stock,
announced they had sold forward 480,000 ounces of gold to finance
an expansion and clean up the existing hedge book. Although, this
represents slightly more than one day's world production of gold,
at about 310,000 ounces, if other producers jump back on the
forward sales bandwagon, the gold market could weaken as supplies
are brought forward.
CURRENT OUTLOOK
OPPORTUNITIES
* Unofficially, hunting season for gold stocks opened in December
with four takeover announcements hitting the market in one day as
senior and mid-tier gold producers sought to take advantage of
cheap valuations currently prevalent in the junior gold stocks.
There had been several takeouts announced earlier in the quarter,
but the valuation gap between the junior and senior gold stocks
persisted for most of 2005. With higher gold prices in 2006, we
expect there will be a drive to acquire more junior companies with
good projects.
* A recent study released by M. Murenbeeld & Associates Inc. that
examined the length of gold cycles going back to the 1800's found
that the average length of a decline was just over 19 years with
the most recent decline being 21 years. The average rising period
for gold has been just over 25 years with the most recent period,
1970 to 1980, being only 10 years in length. We may be just four
years into the current cycle.
* Besides the success of the streetTRACKS Gold Trust(1) ETF over the
last six months, another catalyst for gold in the coming year will
be more Asian buying. At the end of December, the Shanghai Branch
of the Industrial Bank of China launched individual gold passbook
trading accounts.
34
GOLD AND PRECIOUS MINERALS FUNDS
THREATS
* Rising energy prices and reagent costs such as cyanide could
continue to be a drag on gold company earnings in 2006.
* One of the surprises of 2006, as phrased by Richard Bernstein at
Merrill Lynch, could be that the new Federal Reserve Chairman Ben
Bernanke could raise interest rates higher and for longer than the
markets are currently anticipating.
* The gold contango has widened from to 350 b.p. to more than 450
b.p. over the past six months, making forward sales of gold more
attractive, but we have not seen any momentum shift to forward
selling at this time.
(1)This security comprised 0.64 percent of the total net assets of
the World Precious Minerals Fund and 0.95 percent of the total
net assets of the Gold Shares Fund as of December 31, 2005.
(2)The U.S. Trade-Weighted Dollar Index provides a general
indication of the international value of the U.S. dollar.
(3)This security comprised 0.42 percent of the total net assets of
the World Precious Minerals Fund and 0.93 percent of the total
net assets of the Gold Shares Fund as of December 31, 2005.
35
WORLD PRECIOUS MINERALS FUND
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2005
GOLDCORP, INC. 13.00%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
NORTHERN ORION RESOURCES, INC. 8.14%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
BOLIVAR GOLD CORP. 4.45%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
SILVER WHEATON CORP. 3.91%
METAL & MINERAL MINING
---------------------------------------------------------------
RANDGOLD RESOURCES LTD. 3.71%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
MERIDIAN GOLD, INC. 2.59%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
GOLD FIELDS LTD. 2.27%
SENIOR GOLD PRODUCERS
---------------------------------------------------------------
LUNDIN MINING CORP. 2.01%
METAL & MINERAL MINING
---------------------------------------------------------------
MEXGOLD RESOURCES, INC. 1.76%
INTERMEDIATE & JUNIOR GOLD PRODUCERS
---------------------------------------------------------------
AFRICAN PLATINUM PLC 1.73%
GOLD/MINERAL EXPLORATION & DEVELOPMENT
36
GOLD AND PRECIOUS MINERALS FUNDS
GOLD SHARES FUND
TOP 10 EQUITY HOLDINGS BASED ON TOTAL INVESTMENTS December 31, 2005
GOLDCORP, INC. 21.12%
GOLD MINING
---------------------------------------------------------------
NORTHERN ORION RESOURCES, INC. 8.05%
GOLD MINING
---------------------------------------------------------------
FREEPORT-MCMORAN COPPER & GOLD, INC. 6.48%
GOLD MINING
---------------------------------------------------------------
GOLD FIELDS LTD. 5.17%
GOLD MINING
---------------------------------------------------------------
MERIDIAN GOLD, INC. 5.14%
GOLD MINING
---------------------------------------------------------------
SILVER WHEATON CORP. 4.60%
METAL & MINERAL MINING
---------------------------------------------------------------
RANDGOLD RESOURCES LTD. 4.12%
GOLD MINING
---------------------------------------------------------------
NORTHGATE MINERALS CORP. 3.41%
GOLD MINING
---------------------------------------------------------------
NEWMONT MINING CORP. 3.12%
GOLD MINING
---------------------------------------------------------------
BEMA GOLD CORP. 3.02%
GOLD MINING
37
GOLD AND PRECIOUS MINERALS FUNDS
WORLD PRECIOUS MINERALS FUND
PORTFOLIO PROFILE December 31, 2005
Country Distribution* % of Investments
---------------------------------------------------------------
Canada 75.34%
---------------------------------------------------------------
United States 11.02%
---------------------------------------------------------------
United Kingdom 7.10%
---------------------------------------------------------------
South Africa 2.26%
---------------------------------------------------------------
Australia 1.73%
---------------------------------------------------------------
Other Foreign 2.55%
---------------------------------------------------------------
* Country distribution shown is based on domicile and the
locale of company operations may be different.
GOLD SHARES FUND
PORTFOLIO PROFILE December 31, 2005
Country Distribution* % of Investments
---------------------------------------------------------------
Canada 64.59%
---------------------------------------------------------------
United States 22.24%
---------------------------------------------------------------
South Africa 7.14%
---------------------------------------------------------------
United Kingdom 4.12%
---------------------------------------------------------------
Other Foreign 1.91%
---------------------------------------------------------------
* Country distribution shown is based on domicile and the
locale of company operations may be different.
38
GOLD AND PRECIOUS MINERALS FUNDS
WORLD PRECIOUS MINERALS FUND
PORTFOLIO ALLOCATION BY INDUSTRY December 31, 2005
BASED ON TOTAL INVESTMENTS
[World Precious Minerals Fund Pie Graph]
Intermediate & Junior Gold Producers 48.4%
Gold/Mineral Exploration & Development 22.4%
Metal & Mineral Mining 10.0%
Senior Gold Producers 6.5%
Cash Equivalent 5.0%
Other 7.7%
GOLD SHARES FUND
PORTFOLIO ALLOCATION BY INDUSTRY December 31, 2005
BASED ON TOTAL INVESTMENTS
[Gold Shares Fund Pie Graph]
Gold Royalty Company 2.9%
Cash Equivalent 7.1%
Metal & Mineral Mining 8.9%
Gold Mining 77.6%
Other 3.5%
39
EXPENSE EXAMPLE (UNAUDITED) December 31, 2005
As a shareholder of the funds, you incur two types of costs: (1)
transaction costs, including short-term trading fees and exchange
fees; and (2) ongoing costs, including management fees and other
fund expenses. This example is intended to help you understand your
ongoing costs (in dollars) of investing in other mutual funds.
The example is based on an investment of $1,000 invested at the
beginning of the period and held for the entire period as indicated
below.
* ACTUAL EXPENSES. The first line of the following table for each
fund provides information about actual account values and actual
expenses. You may use the information in this line, together with
the amount you invested, to estimate the expenses you paid over
the period. Simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then
multiply the result by the number in the first line under the
heading "Expenses Paid During Period" to estimate the expenses you
paid on your account during this period.
* HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. The second line of
the following table for each fund provides information about
hypothetical account values and hypothetical expenses based on the
fund's actual expense ratio and an assumed rate of return of 5
percent per year before expenses, which is not the fund's actual
return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you
paid for the period. You may use this information to compare the
ongoing costs of investing in these funds and other funds. To do
so, compare this 5 percent hypothetical example with the 5 percent
hypothetical examples that appear in the shareholder reports of
other funds.
Please note that the expenses shown in the table are meant to
highlight your ongoing costs only and do not reflect any direct or
transactional costs, such as small account, exchange or short-term
trading fees. Therefore, the second line of the table is useful in
comparing ongoing costs only, and will not help you determine the
relative total costs of owning different funds. In addition, if
these direct or transactional costs were included, your costs would
have been higher.
40
EXPENSE EXAMPLE (UNAUDITED) December 31, 2005
- ------------------------------------------------------------------------------------
SIX MONTHS ENDED DECEMBER 31, 2005
BEGINNING ENDING EXPENSES
ACCOUNT VALUE ACCOUNT VALUE PAID DURING
JULY 1, 2005 DECEMBER 31, 2005 PERIOD*
- ------------------------------------------------------------------------------------
U.S. TREASURY SECURITIES CASH FUND
Based on Actual Fund Return $1,000.00 $1,012.70 $ 5.17
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,020.06 $ 5.19
- ------------------------------------------------------------------------------------
U.S. GOVERNMENT SECURITIES SAVINGS
FUND
Based on Actual Fund Return $1,000.00 $1,016.00 $ 2.29
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,022.94 $ 2.29
- ------------------------------------------------------------------------------------
NEAR-TERM TAX FREE FUND
Based on Actual Fund Return $1,000.00 $1,005.60 $ 2.29
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,022.92 $ 2.31
- ------------------------------------------------------------------------------------
TAX FREE FUND
Based on Actual Fund Return $1,000.00 $1,008.30 $ 3.55
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,021.67 $ 3.58
- ------------------------------------------------------------------------------------
ALL AMERICAN EQUITY FUND
Based on Actual Fund Return $1,000.00 $1,093.60 $ 9.23
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,016.38 $ 8.89
- ------------------------------------------------------------------------------------
CHINA REGION OPPORTUNITY FUND
Based on Actual Fund Return $1,000.00 $1,154.00 $13.14
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,013.01 $12.28
- ------------------------------------------------------------------------------------
GLOBAL RESOURCES FUND
Based on Actual Fund Return $1,000.00 $1,235.70 $ 5.47
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,020.32 $ 4.94
- ------------------------------------------------------------------------------------
WORLD PRECIOUS MINERALS FUND
Based on Actual Fund Return $1,000.00 $1,381.50 $ 8.16
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,018.35 $ 6.92
- ------------------------------------------------------------------------------------
GOLD SHARES FUND
Based on Actual Fund Return $1,000.00 $1,411.10 $10.45
Based on Hypothetical 5% Yearly
Return $1,000.00 $1,016.53 $ 8.74
- ------------------------------------------------------------------------------------
<FN>
*These calculations are based on expenses incurred in the most
recent fiscal half-year. The funds' annualized six-month expense
ratios for the six-month period ended December 31, 2005, were 1.02%,
0.45%, 0.45%, 0.70%, 1.75%, 2.42%, 0.97%, 1.36% and 1.72%,
respectively, for the 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 Funds. The dollar amounts shown as
"Expenses Paid" are equal to the annualized expense ratio multiplied
by the average account value over the period, multiplied by 184, the
number of days in the most recent fiscal half-year, then divided by
365 days in the current fiscal year.
</FN>
41
U.S. TREASURY SECURITIES CASH FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
UNITED STATES
GOVERNMENT COUPON MATURITY PRINCIPAL
OBLIGATIONS 54.88% RATE DATE AMOUNT VALUE
UNITED STATES TREASURY BILLS 36.48%
- ------------------------------------------------------------------------------------
Yield 3.53% 01/05/06 $ 10,000,000 $ 9,996,078
Yield 3.08% 01/12/06 10,000,000 9,990,589
Yield 3.99% 04/20/06 10,000,000 9,879,191
Yield 4.08% 06/01/06 10,000,000 9,828,867
------------
39,694,725
UNITED STATES TREASURY NOTES 18.40%
- ------------------------------------------------------------------------------------
1.875% 01/31/06 10,000,000 9,989,370
4.625% 05/15/06 10,000,000 10,024,106
------------
20,013,476
- ------------------------------------------------------------------------------------
TOTAL UNITED STATES GOVERNMENT OBLIGATIONS 59,708,201
- ------------------------------------------------------------------------------------
(cost $59,708,201)
REPURCHASE AGREEMENTS 43.94%
Joint Tri-Party Repurchase
Agreements, 12/30/05,
collateralized by U.S.
Treasury securities held in
joint tri-party repurchase
accounts:
3.45% Morgan Stanley Dean
Witter, repurchase price
$25,822,989 3.45% 01/03/06 25,813,094 25,813,094
3.40% UBS Financial Services,
Inc., repurchase price
$22,008,311 3.40% 01/03/06 22,000,000 22,000,000
- ------------------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENTS 47,813,094
- ------------------------------------------------------------------------------------
(cost $47,813,094)
- ------------------------------------------------------------------------------------
TOTAL INVESTMENTS 98.82% 107,521,295
- ------------------------------------------------------------------------------------
(cost $107,521,295)
Other assets and liabilities, net 1.18% 1,283,628
------------
NET ASSETS 100% $108,804,923
------------
See notes to portfolios of investments and notes to financial statements.
42
U.S. GOVERNMENT SECURITIES SAVINGS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
UNITED STATES
GOVERNMENT AND AGENCY COUPON MATURITY PRINCIPAL
OBLIGATIONS 99.73% RATE DATE AMOUNT VALUE
FEDERAL FARM CREDIT BANK 27.66%
- ------------------------------------------------------------------------------------
Discount Notes:
Yield 4.08% 01/04/06 $ 20,000,000 $ 19,993,200
Yield 4.01% 01/11/06 10,000,000 9,988,861
Yield 4.15% 01/13/06 3,105,000 3,100,705
Yield 3.66% 01/26/06 5,000,000 4,987,291
Yield 3.70% 01/31/06 5,000,000 4,984,583
Yield 3.88% 05/15/06 5,000,000 4,927,789
Fixed Rates:
1.70% 01/03/06 1,100,000 1,099,890
1.75% 01/05/06 4,490,000 4,488,946
2.99% 01/11/06 1,000,000 999,846
2.00% 01/23/06 1,000,000 999,134
2.48% 02/06/06 1,350,000 1,348,667
1.85% 03/03/06 1,670,000 1,664,975
2.00% 03/08/06 1,090,000 1,086,782
1.93% 03/15/06 1,900,000 1,893,563
4.90% 03/21/06 5,000,000 5,008,423
5.40% 03/22/06 1,000,000 1,002,008
2.60% 03/29/06 2,000,000 1,995,107
3.65% 04/04/06 2,045,000 2,045,500
2.00% 04/19/06 1,000,000 994,616
5.40% 05/10/06 3,755,000 3,773,101
2.35% 05/12/06 7,150,000 7,099,879
2.60% 05/19/06 2,800,000 2,789,581
3.65% 05/23/06 3,975,000 3,967,591
2.17% 06/12/06 1,425,000 1,410,896
5.50% 06/15/06 1,990,000 2,002,127
2.13% 07/17/06 5,000,000 4,936,320
4.05% 08/11/06 3,000,000 2,999,453
2.80% 08/16/06 2,000,000 1,980,059
2.60% 09/07/06 6,000,000 5,921,297
2.90% 09/29/06 2,500,000 2,472,174
------------
111,962,364
FEDERAL HOME LOAN BANK 72.07%
- ------------------------------------------------------------------------------------
Discount Notes:
Yield 3.51% 01/03/06 161,732,000 161,700,488
Yield 3.97% 01/04/06 17,928,000 17,922,067
Yield 4.18% 01/13/06 25,965,000 25,928,865
Yield 4.08% 01/18/06 10,000,000 9,980,733
Yield 4.16% 01/20/06 8,900,000 8,880,459
See notes to portfolios of investments and notes to financial statements.
43
U.S. GOVERNMENT SECURITIES SAVINGS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
UNITED STATES
GOVERNMENT AND AGENCY COUPON MATURITY PRINCIPAL
OBLIGATIONS RATE DATE AMOUNT VALUE
FEDERAL HOME LOAN BANK (CONT'D)
- -------------------------------------------------------------------------------------
Fixed Rates:
1.75% 01/10/06 $ 2,100,000 $ 2,098,897
1.89% 01/23/06 1,000,000 998,610
2.13% 02/10/06 5,000,000 4,988,847
2.00% 02/13/06 9,400,000 9,376,589
4.00% 02/23/06 2,500,000 2,498,391
2.50% 02/24/06 3,300,000 3,293,739
5.13% 03/06/06 6,100,000 6,109,303
2.50% 03/15/06 2,500,000 2,494,507
2.55% 05/17/06 5,000,000 4,974,506
2.45% 05/19/06 1,925,000 1,913,578
2.65% 05/26/06 2,500,000 2,481,235
6.09% 06/02/06 1,000,000 1,005,816
2.10% 06/12/06 5,000,000 4,947,735
3.75% 06/30/06 3,000,000 2,996,914
3.25% 07/21/06 4,000,000 3,984,899
2.75% 07/28/06 4,000,000 3,972,864
2.50% 08/14/06 4,350,000 4,299,905
2.70% 09/29/06 2,000,000 1,970,726
3.00% 11/06/06 1,585,000 1,563,212
Step Coupon:
3.25% 11/24/06 1,400,000 1,391,264
------------
291,774,149
- ------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.73% 403,736,513
- ------------------------------------------------------------------------------------
(cost $403,736,513)
Other assets and liabilities,
net 0.27% 1,105,113
------------
NET ASSETS 100% $404,841,626
------------
See notes to portfolios of investments and notes to financial statements.
44
NEAR-TERM TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS 94.06% RATE DATE AMOUNT VALUE
ALABAMA 1.64%
- --------------------------------------------------------------------------------------
DCH Health Care Authority Facilities
Revenue 5.00% 06/01/09 $ 250,000 $ 262,097
ARIZONA 3.26%
- --------------------------------------------------------------------------------------
Arizona State Transportation Board,
Series A 5.00% 07/01/09 300,000 315,462
Maricopa County, Arizona Unified School
District, GO 4.85% 07/01/11 200,000 206,372
-----------
521,834
CALIFORNIA 6.63%
- --------------------------------------------------------------------------------------
Association of Bay Area Governments
(ABAG) Finance Authority, Series C 4.00% 03/01/08 100,000 100,365
California State, GO 6.40% 02/01/06 500,000 501,135
Chino Basin Regional Financing
Authority Revenue 7.00% 08/01/06 250,000 255,250
San Diego, California Community College
District, GO Unlimited, (ZCB) 0.00% 05/01/15 300,000 203,073
-----------
1,059,823
COLORADO 3.21%
- --------------------------------------------------------------------------------------
Adams & Arapahoe Counties Joint School
District, Series C, GO 5.75% 12/01/07 100,000 104,180
Platte River Power Authority Revenue,
Series FF 5.00% 06/01/07 400,000 409,140
-----------
513,320
CONNECTICUT 2.98%
- --------------------------------------------------------------------------------------
Bridgeport, Series A, GO 6.00% 03/01/06 200,000 200,852
Connecticut State, Series D, GO
Unlimited 5.375% 11/15/18 250,000 275,317
-----------
476,169
DELAWARE 1.31%
- --------------------------------------------------------------------------------------
Delaware Transportation Authority
System Revenue 5.50% 07/01/08 200,000 210,088
DISTRICT OF COLUMBIA 1.00%
- --------------------------------------------------------------------------------------
District of Columbia, Unrefunded,
Series B 5.50% 06/01/09 150,000 159,696
FLORIDA 4.25%
- --------------------------------------------------------------------------------------
Florida State Board of Education
Capital Outlay, Series B, GO 5.25% 06/01/11 175,000 183,818
Hillsborough County Industrial
Development Authority Hospital
Revenue 3.50% 10/01/09 205,000 202,938
See notes to portfolios of investments and notes to financial statements.
45
NEAR-TERM TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
FLORIDA (CONT'D)
- --------------------------------------------------------------------------------------
Jacksonville Transportation
Authority, GO 6.50% 07/01/07 $ 280,000 $ 293,037
-----------
679,793
GEORGIA 4.18%
- --------------------------------------------------------------------------------------
Atlanta Development Authority Revenue,
Series A 5.25% 07/01/12 375,000 390,244
Coweta County School District, GO 4.00% 08/01/06 175,000 175,773
Georgia Municipal Electric Authority
Power Revenue, Series A 5.30% 01/01/07 100,000 101,979
-----------
667,996
ILLINOIS 6.03%
- --------------------------------------------------------------------------------------
Chicago Water Revenue (ZCB) 0.00% 11/01/08 275,000 249,001
Illinois Finance Authority Revenue,
Refunding 5.00% 07/01/16 390,000 421,500
Western Illinois, University and
College Revenue 3.50% 04/01/13 300,000 294,711
-----------
965,212
INDIANA 3.69%
- --------------------------------------------------------------------------------------
Indiana State Finance Authority
Revenue, Refunding 4.00% 05/01/12 350,000 357,241
Indianapolis, Indiana Local Public
Improvement Bond Bank, Series D 6.60% 02/01/07 225,000 232,704
-----------
589,945
IOWA 1.99%
- --------------------------------------------------------------------------------------
Ames, Iowa Hospital Revenue, Refunding 5.00% 06/15/15 300,000 318,549
KANSAS 1.27%
- --------------------------------------------------------------------------------------
Kansas State Development Finance
Authority Revenue 4.00% 10/01/15 200,000 202,732
MASSACHUSETTS 1.49%
- --------------------------------------------------------------------------------------
Massachusetts State Health &
Educational Facilities Authority
Revenue, Series D 5.00% 10/01/07 135,000 135,146
Massachusetts State, Series C, GO 4.625% 10/01/08 100,000 103,147
-----------
238,293
MICHIGAN 2.03%
- --------------------------------------------------------------------------------------
Detroit, Michigan Local Development
Financial Authority, Series A 5.20% 05/01/10 130,000 133,289
See notes to portfolios of investments and notes to financial statements.
46
NEAR-TERM TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
MICHIGAN (CONT'D)
- --------------------------------------------------------------------------------------
Michigan Municipal Board Authority
Revenue 3.00% 11/01/09 $ 200,000 $ 191,232
-----------
324,521
MISSISSIPPI 3.68%
- --------------------------------------------------------------------------------------
Mississippi Development Bank Special
Obligation 3.25% 11/01/07 300,000 292,212
Mississippi Hospital Equipment &
Facilities Authority Revenue 3.45% 04/01/07 300,000 296,595
-----------
588,807
NEVADA 3.19%
- --------------------------------------------------------------------------------------
Nevada State Municipal Bond Bank
Project #51, Series A, GO 5.10% 01/01/08 250,000 250,000
Washoe County Gas & Water Facilities
Revenue 6.30% 12/01/14 250,000 260,627
-----------
510,627
NEW JERSEY 4.79%
- --------------------------------------------------------------------------------------
Brigantine, New Jersey School
Improvements, GO Unlimited 3.50% 01/15/13 300,000 296,496
New Jersey State 5.125% 05/01/10 250,000 266,255
Washington Township Board of Education,
GO 5.10% 02/01/08 200,000 203,864
-----------
766,615
NEW YORK 10.38%
- --------------------------------------------------------------------------------------
Hempstead Township, Series B, GO
Unlimited Tax 5.375% 11/15/10 120,000 125,806
New York City Transitional Financial
Authority Revenue, Series A 5.25% 11/01/08 225,000 236,534
New York, New York, Series B 5.25% 08/01/09 200,000 211,170
New York, New York, Series C 3.50% 08/01/07 300,000 300,588
New York State, GO 5.00% 03/01/08 250,000 258,658
New York State, Local Highway & Bridge,
Series A 5.375% 04/01/10 200,000 210,422
Schenectady Metroplex Development
Authority Revenue, Series A 5.00% 12/15/12 110,000 114,956
Tobacco Settlement Financing Corp.,
Series B 4.00% 06/01/07 200,000 201,574
-----------
1,659,708
NORTH CAROLINA 1.14%
- --------------------------------------------------------------------------------------
North Carolina Eastern Municipal Power
Agency Revenue, Refunding, Series A 5.60% 01/01/10 175,000 182,133
OHIO 1.27%
- --------------------------------------------------------------------------------------
Ohio State Higher Education, Series B,
GO 4.25% 11/01/07 200,000 203,184
See notes to portfolios of investments and notes to financial statements.
47
NEAR-TERM TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
OREGON 2.10%
- --------------------------------------------------------------------------------------
Clackamas County Hospital Facilities
Authority Revenue 5.00% 05/01/07 $ 200,000 $ 203,964
Oregon State Department Transportation
Highway 5.00% 11/15/09 125,000 132,268
-----------
336,232
SOUTH CAROLINA 4.47%
- --------------------------------------------------------------------------------------
Horry County Hospitality Fee Special
Obligation 5.00% 04/01/10 200,000 210,022
Jasper County School District, GO
Unlimited 4.00% 03/01/15 195,000 198,590
Spartanburg County School District 3.875% 04/01/12 300,000 305,907
-----------
714,519
TENNESSEE 1.22%
- --------------------------------------------------------------------------------------
Shelby County Tennessee Health
Educational & Housing Facilities
Board Revenue 5.15% 07/01/07 300,000 194,931
TEXAS 13.92%
- --------------------------------------------------------------------------------------
Arlington Refunding, Series A 5.00% 08/15/08 200,000 208,026
Bexar County Refunded, GO 5.40% 06/15/12 200,000 201,804
Gulf Coast Industrial Development
Authority Pollution Control Revenue 4.95% 07/01/07 385,000 393,986
Killeen, Texas Independent School
District, GO Unlimited, Prerefunded 5.00% 02/15/09 310,000 320,459
Killeen, Texas Independent School
District, GO Unlimited, Unrefunded 5.00% 02/15/09 90,000 92,944
Rowlett, Texas, GO Unlimited, Refunding 4.00% 02/15/16 300,000 297,036
San Antonio Water System Revenue 5.00% 05/15/13 100,000 106,065
Texas State Affordable Housing Corp. 4.00% 11/01/06 110,000 105,104
Texas State Water Development Board
Revenue, Series A 5.125% 07/15/09 290,000 292,819
Texas Turnpike Authority Revenue 5.00% 06/01/08 200,000 207,466
-----------
2,225,709
UTAH 1.30%
- --------------------------------------------------------------------------------------
Utah Transit Authority Sales Tax &
Transportation Revenue 4.90% 12/15/09 200,000 208,044
WASHINGTON 0.67%
- --------------------------------------------------------------------------------------
Clark County, Washington School
District, GO Unlimited 5.125% 12/01/11 100,000 108,100
See notes to portfolios of investments and notes to financial statements.
48
NEAR-TERM TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
WISCONSIN 0.97%
- --------------------------------------------------------------------------------------
Milwaukee, Wisconsin, Series L, GO 4.60% 12/15/13 $ 150,000 $ 155,426
- --------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS 15,044,103
- --------------------------------------------------------------------------------------
(cost $15,097,598)
REPURCHASE AGREEMENT 4.47%
Joint Tri-Party Repurchase Agreement,
Morgan Stanley Dean Witter, 12/30/05,
3.45%, due 01/03/06, repurchase price
$715,207, collateralized by U.S.
Treasury securities held in a joint
tri-party repurchase account
(cost $714,933) 3.45% 01/03/06 714,933 714,933
- --------------------------------------------------------------------------------------
TOTAL INVESTMENTS 98.53% 15,759,036
- --------------------------------------------------------------------------------------
(cost $15,812,531)
Other assets and liabilities, net 1.47% 234,321
-----------
NET ASSETS 100% $15,993,357
-----------
See notes to portfolios of investments and notes to financial statements.
49
TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS 96.41% RATE DATE AMOUNT VALUE
ALABAMA 4.57%
- -------------------------------------------------------------------------------------
Alabama 21st Century Authority Tobacco
Settlement Revenue 5.75% 12/01/19 $ 275,000 $ 291,912
Alabama State, GO Unlimited, Series A 4.625% 09/01/22 375,000 386,606
-----------
678,518
CALIFORNIA 6.35%
- -------------------------------------------------------------------------------------
California State, GO Unlimited 5.00% 02/01/25 320,000 332,915
Campbell, California Union High School
District, GO Unlimited 4.75% 08/01/34 300,000 303,996
San Diego, California Community College
District, GO Unlimited (ZCB) 0.00% 05/01/15 450,000 304,609
-----------
941,520
COLORADO 1.05%
- -------------------------------------------------------------------------------------
Colorado Health Facility Authority
Revenue 5.00% 09/01/16 150,000 156,282
FLORIDA 6.56%
- -------------------------------------------------------------------------------------
Florida Board of Education Capital
Outlay, GO Unlimited Tax, Refunding,
Series A 6.625% 06/01/07 165,000 167,958
Florida Board of Education, GO
Unlimited, Refunding, Series C 4.50% 06/01/28 300,000 301,476
St. Lucie County Florida Sales Tax
Revenue 5.25% 10/01/23 465,000 503,390
-----------
972,824
GEORGIA 6.42%
- -------------------------------------------------------------------------------------
Atlanta Development Authority Revenue 5.25% 07/01/22 500,000 524,625
Chatham County Hospital Authority
Revenue, Series A 5.50% 01/01/34 405,000 428,583
-----------
953,208
ILLINOIS 10.81%
- -------------------------------------------------------------------------------------
Du Page County, Refunding 5.60% 01/01/21 490,000 556,464
Illinois Development Financing
Authority Hospital Revenue, Adventist
Health Systems 5.65% 11/15/24 435,000 474,263
Illinois Development Financing
Authority Revenue, Presbyterian Home
Lake Project, Series B 6.25% 09/01/17 250,000 259,257
Illinois Regional Transportation
Authority Revenue, Series A 7.20% 11/01/20 250,000 313,865
-----------
1,603,849
See notes to portfolios of investments and notes to financial statements.
50
TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
IOWA 2.04%
- -------------------------------------------------------------------------------------
Davenport, Iowa, GO Unlimited, Series A 4.375% 06/01/20 $ 300,000 $ 302,196
KANSAS 9.39%
- -------------------------------------------------------------------------------------
Kansas State Development Finance
Authority Hospital Revenue, Series Z 5.00% 12/15/12 500,000 531,725
Kansas State Development Finance
Authority Revenue 4.00% 10/01/15 250,000 253,415
University of Kansas Hospital Authority
Health Facilities Revenue 5.625% 09/01/27 570,000 607,842
-----------
1,392,982
MARYLAND 2.16%
- -------------------------------------------------------------------------------------
Maryland State Health & Higher
Educational Facilities Authority
Revenue 5.75% 07/01/21 300,000 321,066
MICHIGAN 4.12%
- -------------------------------------------------------------------------------------
Detroit, Michigan Local Development
Financing Authority, Refunding,
Series A 5.375% 05/01/18 300,000 306,696
Macomb County Building Authority, GO
Limited 4.50% 11/01/23 300,000 304,029
-----------
610,725
MISSOURI 2.88%
- -------------------------------------------------------------------------------------
St. Louis Airport Development Program,
Prerefunded, Series A 5.00% 07/01/11 235,000 250,529
St. Louis Airport Development Program,
Unrefunded, Series A 5.00% 07/01/11 165,000 177,091
-----------
427,620
NEW JERSEY 5.40%
- -------------------------------------------------------------------------------------
New Jersey Health Care Facilities
Financing Authority Revenue 4.375% 07/01/10 460,000 470,631
New Jersey State Transportation
Authority, Series A 5.00% 06/15/13 315,000 331,245
-----------
801,876
NEW YORK 5.00%
- -------------------------------------------------------------------------------------
New York, GO Unlimited, Prerefunded,
Series H 5.25% 03/15/14 445,000 474,811
New York, GO Unlimited, Unrefunded,
Series H 5.25% 03/15/14 5,000 5,249
New York, GO Unlimited, Series J 5.00% 05/15/12 250,000 261,815
-----------
741,875
See notes to portfolios of investments and notes to financial statements.
51
TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
OHIO 3.59%
- -------------------------------------------------------------------------------------
Ohio State Mental Health Facilities
Revenue 5.50% 06/01/15 $ 300,000 $ 324,546
South Euclid Special Assessment, GO
Limited Tax 6.70% 12/01/14 185,000 208,758
-----------
533,304
PENNSYLVANIA 3.54%
- -------------------------------------------------------------------------------------
Chester County Health & Educational
Facilities Authority Revenue 5.00% 05/15/08 250,000 259,050
Philadelphia Hospital & Higher
Educational Facilities Authority
Revenue 4.95% 06/15/06 265,000 265,390
-----------
524,440
PUERTO RICO 2.15%
- -------------------------------------------------------------------------------------
Puerto Rico Electric Power Authority
Revenue, Series II 5.125% 07/01/26 300,000 319,059
RHODE ISLAND 3.74%
- -------------------------------------------------------------------------------------
Rhode Island State Health & Educational
Building Corporation Revenue 6.50% 08/15/32 500,000 554,195
SOUTH CAROLINA 1.73%
- -------------------------------------------------------------------------------------
South Carolina Jobs Economic
Development Authority Revenue 5.00% 11/01/23 250,000 256,357
TEXAS 7.47%
- -------------------------------------------------------------------------------------
Austin, Texas, GO 5.00% 09/01/16 565,000 582,662
Duncanville, Texas Independent School
District, GO Unlimited, Series B 5.25% 02/15/32 500,000 526,090
-----------
1,108,752
UTAH 2.08%
- -------------------------------------------------------------------------------------
Weber County School District, GO
Unlimited, Prerefunded, Series A 5.15% 06/15/08 110,000 112,924
Weber County School District, GO
Unlimited, Unrefunded, Series A 5.15% 06/15/08 190,000 194,942
-----------
307,866
VERMONT 2.05%
- -------------------------------------------------------------------------------------
Vermont Educational & Health Buildings
Financing Agency Revenue, Vermont Law
School Project, Series A 5.375% 01/01/23 300,000 303,591
See notes to portfolios of investments and notes to financial statements.
52
TAX FREE FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COUPON MATURITY PRINCIPAL
MUNICIPAL BONDS RATE DATE AMOUNT VALUE
WASHINGTON 3.31%
- -------------------------------------------------------------------------------------
King & Snohomish Counties' School
District, Series C 5.00% 06/15/10 $ 250,000 $ 261,828
Spokane County Washington School
District, GO Unlimited 5.05% 06/01/22 255,000 229,605
-----------
491,433
- -------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS 14,303,538
- -------------------------------------------------------------------------------------
(cost $13,673,152)
REPURCHASE AGREEMENT 2.61%
Joint Tri-Party Repurchase Agreement,
Morgan Stanley Dean Witter, 12/30/05,
3.45%, due 01/03/06, repurchase price
$387,409, collateralized by U.S.
Treasury securities held in a joint
tri-party repurchase account
(cost $387,261) 3.45% 01/03/06 387,261 387,261
- -------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.02% 14,690,799
- -------------------------------------------------------------------------------------
(cost $14,060,413)
Other assets and liabilities, net 0.98% 145,838
-----------
NET ASSETS 100% $14,836,637
-----------
See notes to portfolios of investments and notes to financial statements.
53
ALL AMERICAN EQUITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS 89.63% SHARES VALUE
AIRLINES 0.66%
- ---------------------------------------------------------------------------------------
SkyWest, Inc. 5,000 $ 134,300
APPAREL 1.05%
- ---------------------------------------------------------------------------------------
Gildan Activewear, Inc. 5,000 214,250*
APPLICATIONS SOFTWARE 1.33%
- ---------------------------------------------------------------------------------------
Red Hat, Inc. 10,000 272,400*
BEVERAGES 0.87%
- ---------------------------------------------------------------------------------------
PepsiCo, Inc. 3,000 177,240
CABLE TV 0.14%
- ---------------------------------------------------------------------------------------
Stream Communications Network, Inc. 190,000 28,500*
COMMERCIAL SERVICES 2.00%
- ---------------------------------------------------------------------------------------
Iron Mountain, Inc. 5,000 211,100*
Quanta Services, Inc. 15,000 197,550*
-----------
408,650
COMPUTERS 2.67%
- ---------------------------------------------------------------------------------------
Apple Computer, Inc. 6,000 431,340*
Hewlett-Packard Co. 4,000 114,520
-----------
545,860
COMPUTERS - HARDWARE & SOFTWARE 1.46%
- ---------------------------------------------------------------------------------------
Intergraph Corp. 6,000 298,860*
COMPUTERS - MEMORY DEVICES 2.23%
- ---------------------------------------------------------------------------------------
EMC Corp. 15,000 204,300*
SanDisk Corp. 4,000 251,280*
-----------
455,580
DATA PROCESSING & SOFTWARE 1.02%
- ---------------------------------------------------------------------------------------
Global Payments, Inc. 4,500 209,745
DISTRIBUTION/WHOLESALE 1.17%
- ---------------------------------------------------------------------------------------
Watsco, Inc. 4,000 239,240
E-COMMERCE / SERVICES 0.89%
- ---------------------------------------------------------------------------------------
Blue Nile, Inc. 4,500 181,395*
See notes to portfolios of investments and notes to financial statements.
54
ALL AMERICAN EQUITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
ELECTRIC - INTEGRATED 0.96%
- ---------------------------------------------------------------------------------------
Edison International 4,500 $ 196,245
ELECTRONICS & COMPONENTS 6.04%
- ---------------------------------------------------------------------------------------
Advanced Micro Devices, Inc. 12,000 367,200*
Broadcom Corp., Class A 5,000 235,750*
Jabil Circuit, Inc. 7,500 278,175*
PortalPlayer, Inc. 12,500 354,000*
-----------
1,235,125
ENGINEERING SERVICES 0.98%
- ---------------------------------------------------------------------------------------
McDermott International, Inc. 4,500 200,745*
FINANCIAL SERVICES 7.06%
- ---------------------------------------------------------------------------------------
Charles Schwab Corp. 7,000 102,690
Digital Insight Corp. 9,000 288,180*
E*TRADE Financial Corp. 15,000 312,900*
JPMorgan Chase & Co. 7,500 297,675
optionsXpress Holdings, Inc. 5,000 122,750
PNC Financial Services Group, Inc. 2,500 154,575
State Street Corp. 3,000 166,320
-----------
1,445,090
GOLD MINING 6.62%
- ---------------------------------------------------------------------------------------
Bema Gold Corp., Warrants (October 2007) 25,000 37,962*
Goldcorp, Inc., Warrants (March 2007), Class C 118,000 490,971*
Goldcorp, Inc., Warrants (May 2007), Class A 138,000 574,186*
Goldcorp, Inc., Warrants (August 2008), Class B 50,000 152,275*
Virginia Gold Mines, Inc. 10,000 99,944*
-----------
1,355,338
HOTELS 1.22%
- ---------------------------------------------------------------------------------------
Choice Hotels International, Inc. 6,000 250,560
INDEX FUND 3.37%
- ---------------------------------------------------------------------------------------
Biotech HOLDRs Trust 1,000 200,590
iShares MSCI Japan Index Fund 15,000 202,800
Nasdaq-100 Index Tracking Stock 4,000 161,680
SPDR Trust Series 1 1,000 124,510
-----------
689,580
See notes to portfolios of investments and notes to financial statements.
55
ALL AMERICAN EQUITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
INSURANCE 4.06%
- ---------------------------------------------------------------------------------------
Brown & Brown, Inc. 6,000 $ 183,240
Loews Corp. 3,000 284,550
Philadelphia Consolidated Holding Corp. 1,500 145,035*
ProAssurance Corp. 4,500 218,880*
-----------
831,705
INTERNET 2.19%
- ---------------------------------------------------------------------------------------
Google, Inc., Class A 1,000 414,860*
Stockgroup Information Systems, Inc. 110,000 33,000*
-----------
447,860
INVESTMENT ADVISERS 2.35%
- ---------------------------------------------------------------------------------------
Franklin Resources, Inc. 4,000 376,040
National Financial Partners Corp. 2,000 105,100
-----------
481,140
MACHINERY 1.67%
- ---------------------------------------------------------------------------------------
JLG Industries, Inc. 7,500 342,450
MANUFACTURING 2.81%
- ---------------------------------------------------------------------------------------
General Electric Co. 7,000 245,350
Trinity Industries, Inc. 7,500 330,525
-----------
575,875
MARKETING 1.48%
- ---------------------------------------------------------------------------------------
aQuantive, Inc. 12,000 302,880*
MEDIA 0.43%
- ---------------------------------------------------------------------------------------
Martha Stewart Living Omnimedia, Inc., Class A 5,000 87,150*
MEDICAL - DRUGS 1.68%
- ---------------------------------------------------------------------------------------
Cardinal Health, Inc. 5,000 343,750
MEDICAL - HMO 2.28%
- ---------------------------------------------------------------------------------------
UnitedHealth Group, Inc. 7,500 466,050
MEDICAL - PRODUCTS 6.22%
- ---------------------------------------------------------------------------------------
Hologic, Inc. 10,000 379,200*
Intuitive Surgical, Inc. 3,500 410,445*
Quality Systems, Inc. 3,000 230,280
See notes to portfolios of investments and notes to financial statements.
56
ALL AMERICAN EQUITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
MEDICAL - PRODUCTS (CONT'D)
- ---------------------------------------------------------------------------------------
Syneron Medical Ltd. 8,000 $ 254,000*
-----------
1,273,925
METAL - IRON 0.86%
- ---------------------------------------------------------------------------------------
Cleveland-Cliffs, Inc. 2,000 177,140
NON-FERROUS METALS 1.05%
- ---------------------------------------------------------------------------------------
USEC, Inc. 18,000 215,100
OIL & GAS DRILLING 1.93%
- ---------------------------------------------------------------------------------------
Atlas America, Inc. 1,500 90,330*
ENSCO International, Inc. 2,000 88,700
Todco, Class A 2,000 76,120
Transocean, Inc. 2,000 139,380*
-----------
394,530
OIL & GAS EQUIPMENT & SERVICES 1.15%
- ---------------------------------------------------------------------------------------
Mitcham Industries, Inc. 6,000 104,820*
RPC, Inc. 5,000 131,700
-----------
236,520
OIL & GAS EXPLORATION & PRODUCTION 1.20%
- ---------------------------------------------------------------------------------------
Petrohawk Energy Corp. 8,000 105,760*
Ultra Petroleum Corp. 2,500 139,500*
-----------
245,260
OIL & GAS FIELD SERVICES 0.88%
- ---------------------------------------------------------------------------------------
Cal Dive International, Inc. 5,000 179,450*
OIL & GAS REFINING & MARKETING 1.01%
- ---------------------------------------------------------------------------------------
Valero Energy Corp. 4,000 206,400
PHARMACEUTICALS 0.88%
- ---------------------------------------------------------------------------------------
Amylin Pharmaceuticals, Inc. 4,500 179,640*
PHARMACY SERVICES 1.66%
- ---------------------------------------------------------------------------------------
Express Scripts, Inc. 2,000 167,600*
Omnicare, Inc. 3,000 171,660
-----------
339,260
See notes to portfolios of investments and notes to financial statements.
57
ALL AMERICAN EQUITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
REAL ESTATE INVESTMENT TRUST 0.77%
- ---------------------------------------------------------------------------------------
U-Store-It Trust 7,500 $ 157,875
RESTAURANTS 0.88%
- ---------------------------------------------------------------------------------------
Ruth's Chris Steak House, Inc. 10,000 181,000*
RETAIL 5.00%
- ---------------------------------------------------------------------------------------
Brown Shoe Company, Inc. 4,000 169,720
Payless ShoeSource, Inc. 11,000 276,100*
The Dress Barn, Inc. 4,000 154,440*
The Pantry, Inc. 6,000 281,940*
Wal-Mart Stores, Inc. 3,000 140,400
-----------
1,022,600
RETIREMENT & AGED CARE 0.92%
- ---------------------------------------------------------------------------------------
American Retirement Corp. 7,500 188,475*
TRANSPORTATION 2.76%
- ---------------------------------------------------------------------------------------
Burlington Northern Santa Fe Corp. 6,000 424,920
UTI Worldwide, Inc. 1,500 139,260
-----------
564,180
WIRELESS EQUIPMENT 1.77%
- ---------------------------------------------------------------------------------------
Motorola, Inc. 16,000 361,440
- ---------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 18,340,358
- ---------------------------------------------------------------------------------------
(cost $16,034,936)
PRINCIPAL
REPURCHASE AGREEMENT 5.53% AMOUNT
Joint Tri-Party Repurchase Agreement, Morgan Stanley
Dean Witter, 12/30/05, 3.45%, due 01/03/06, repurchase
price $1,132,628, collateralized by U.S. Treasury
securities held in a joint tri-party repurchase
account (cost $1,132,194) $1,132,194 1,132,194
- ---------------------------------------------------------------------------------------
TOTAL INVESTMENTS 95.16% 19,472,552
- ---------------------------------------------------------------------------------------
(cost $17,167,130)
Other assets and liabilities, net 4.84% 989,410
-----------
NET ASSETS 100% $20,461,962
-----------
See notes to portfolios of investments and notes to financial statements.
58
CHINA REGION OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS 92.97%
SHARES VALUE
ADVERTISING 1.36%
- ----------------------------------------------------------------------------------------
Focus Media Holding Ltd., ADR 15,000 $ 506,550*
AGRICULTURE 0.56%
- ----------------------------------------------------------------------------------------
Chaoda Modern Agriculture Ltd. 500,000 207,967
AIRLINES 0.47%
- ----------------------------------------------------------------------------------------
Cathay Pacific Airways Ltd. 100,000 175,401
AUDIO & VIDEO PRODUCTS 0.14%
- ----------------------------------------------------------------------------------------
Skyworth Digital Holdings Ltd. 600,000 52,717
AUTOMOBILE 3.42%
- ----------------------------------------------------------------------------------------
Hyundai Motor Co. 10,000 961,938
Toyota Motor Corp., Sponsored ADR 3,000 313,860
-----------
1,275,798
BANKS 4.92%
- ----------------------------------------------------------------------------------------
Kookmin Bank, Sponsored ADR 20,000 1,494,200
Mitsubishi UFJ Financial Group, Inc., ADR 25,000 342,250
-----------
1,836,450
BUILDING MATERIALS 1.32%
- ----------------------------------------------------------------------------------------
Anhui Conch Cement Co., Ltd., H Shares 400,000 492,671
CELLULAR TELECOMMUNICATIONS 2.85%
- ----------------------------------------------------------------------------------------
China Mobile (Hong Kong) Ltd., H shares 225,000 1,063,531
CHEMICALS - AGRICULTURAL 1.48%
- ----------------------------------------------------------------------------------------
Spur Ventures, Inc. 500,000 553,339*
COAL 0.89%
- ----------------------------------------------------------------------------------------
Western Canadian Coal Corp. 110,000 331,231*
COMPUTERS 4.55%
- ----------------------------------------------------------------------------------------
Acer, Inc. 290,000 728,887
Lenovo Group Ltd. 700,000 322,751
Lite-On Technology Corp. 475,000 647,583
-----------
1,699,221
See notes to portfolios of investments and notes to financial statements.
59
CHINA REGION OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
CONTAINERS 0.53%
- ----------------------------------------------------------------------------------------
China International Marine Containers (Group) Co., Ltd.,
B shares 246,282 $ 198,521
DISTRIBUTION/WHOLESALE 2.68%
- ----------------------------------------------------------------------------------------
Esprit Holdings Ltd. 100,000 710,633
Li & Fung Ltd. 150,000 289,219
-----------
999,852
DIVERSIFIED MINERALS 0.47%
- ----------------------------------------------------------------------------------------
Caledon Resources plc 875,000 50,751*
Erdene Gold, Inc. 100,000 89,221*
New Pacific Metals Corp. 100,000 35,173*
-----------
175,145
DIVERSIFIED OPERATIONS 3.36%
- ----------------------------------------------------------------------------------------
China Merchants Holdings International Co., Ltd. 400,000 866,689
First Pacific Co., Ltd. 1,000,000 386,914
-----------
1,253,603
ELECTRONICS & COMPONENTS 9.62%
- ----------------------------------------------------------------------------------------
AU Optronics Corp., ADR 50,000 750,500
Canon, Inc., Sponsored ADR 4,500 264,735
Hon Hai Precision Industry Co., Ltd. 203,275 1,114,718
LG Electronics, Inc. 7,500 662,135
MediaTek, Inc. 40,000 471,606
Samsung Electronics Co., Ltd. 500 325,754
Yageo Corp. 1 2*
-----------
3,589,450
FINANCIAL SERVICES 8.01%
- ----------------------------------------------------------------------------------------
Daewoo Securities Co., Ltd. 30,000 551,656*
Hong Kong Exchanges & Clearing Ltd. 200,000 829,287
Korea Investment Holdings Co., Ltd. 15,000 637,667
Singapore Exchange Ltd. 100,000 174,368
Woori Finance Holdings Co., Ltd. 40,000 794,859
-----------
2,987,837
FOOD & BEVERAGES 0.69%
- ----------------------------------------------------------------------------------------
China Mengniu Dairy Co., Ltd. 300,000 259,233
GAS DISTRIBUTION 0.58%
- ----------------------------------------------------------------------------------------
Hong Kong & China Gas Co., Ltd. 101,693 216,406
See notes to portfolios of investments and notes to financial statements.
60
CHINA REGION OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD MINING 2.15%
- ----------------------------------------------------------------------------------------
China NetTV Holdings, Inc. 500,000 $ 95,000*
Entree Gold, Inc. 300,000 445,245*
Olympus Pacific Minerals, Inc. 340,500 105,160*
Silk Road Resources Ltd. 260,000 156,136*
-----------
801,541
INDEX FUND 3.70%
- ----------------------------------------------------------------------------------------
iShares MSCI Japan Index Fund 25,000 338,000
iShares MSCI Singapore (Free) Index Fund 20,000 158,000
iShares MSCI South Korea Index Fund 10,000 447,500
iShares MSCI Taiwan Index Fund 35,000 436,800
-----------
1,380,300
INSURANCE 2.37%
- ----------------------------------------------------------------------------------------
China Life Insurance Co., Ltd., H shares 1,000,000 883,455*
INTERNET 1.69%
- ----------------------------------------------------------------------------------------
Asia Broadband, Inc. 1,004,945 170,841*
Tencent Holdings Ltd. 200,000 214,093
Tom Online, Inc., ADR 12,500 247,750*
-----------
632,684
MACHINERY 2.69%
- ----------------------------------------------------------------------------------------
Doosan Heavy Industries and Construction Co., Ltd. 20,000 750,371
Kubota Corp., Sponsored ADR 6,000 255,000
-----------
1,005,371
MACHINERY TOOLS & RELATED PRODUCTS 0.64%
- ----------------------------------------------------------------------------------------
Techtronic Industries Co., Ltd. 100,000 237,952
MEDIA 2.00%
- ----------------------------------------------------------------------------------------
Sun New Media, Inc. 182,750 747,447*
MEDICAL - DRUGS 0.77%
- ----------------------------------------------------------------------------------------
Hanmi Pharmaceutical Co., Ltd. 2,100 288,581
METAL - ALUMINUM 3.37%
- ----------------------------------------------------------------------------------------
Aluminum Corporation of China Ltd., H Shares 1,200,000 913,118
Global Alumina Products Corp. 190,000 324,900*
Global Alumina Products Corp., Warrants (January 2006) 100,000 21,000*
-----------
1,259,018
See notes to portfolios of investments and notes to financial statements.
61
CHINA REGION OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
METAL - COPPER 1.06%
- ----------------------------------------------------------------------------------------
Continental Minerals Corp. 200,000 $ 291,683*
Toledo Mining Corp. plc 45,240 102,238*
-----------
393,921
NON-FERROUS METALS 0.23%
- ----------------------------------------------------------------------------------------
Sterling Group Ventures, Inc. 512,800 87,176*
Sterling Group Ventures, Inc., Warrants (February 2006) 500,000 0*
-----------
87,176
OIL & GAS - INTEGRATED 1.94%
- ----------------------------------------------------------------------------------------
PetroChina Co., Ltd., ADR 7,500 614,700
PTT plc 20,000 110,230
-----------
724,930
OIL & GAS EXPLORATION & PRODUCTION 7.50%
- ----------------------------------------------------------------------------------------
Big Sky Energy Corp. 1,000,000 1,730,000*
Big Sky Energy Corp. (RS) 100,000 164,350*
CNOOC Ltd., ADR 7,500 509,775
CNPC Hong Kong Ltd. 750,000 165,406
PTT Exploration and Production plc 20,000 230,216
-----------
2,799,747
PRECIOUS METALS 0.79%
- ----------------------------------------------------------------------------------------
Golden China Resources Corp. 267,000 71,008*
TVI Pacific, Inc. 2,285,714 225,503*
-----------
296,511
PUBLISHING 0.31%
- ----------------------------------------------------------------------------------------
Lingo Media, Inc. 790,000 115,215*
REAL ESTATE COMPANIES 4.79%
- ----------------------------------------------------------------------------------------
Capitaland Ltd. 150,000 310,255
Cheung Kong Holdings Ltd. 60,000 616,355
China Overseas Land & Investment Ltd. 2,000,000 857,661
Daying Modern Agricultural Co. 1 0*
United Overseas Land Ltd. 1,500 2,264
-----------
1,786,535
RETAIL 1.17%
- ----------------------------------------------------------------------------------------
China First Pencil Co., Ltd., B shares 1 0*
Shanghai Friendship Group, Inc., Co., B shares 2 1
See notes to portfolios of investments and notes to financial statements.
62
CHINA REGION OPPORTUNITY FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
RETAIL (CONT'D)
- ----------------------------------------------------------------------------------------
Shinsegae Co., Ltd. 1,000 $ 437,963
-----------
437,964
SCHOOLS 2.14%
- ----------------------------------------------------------------------------------------
Capital Alliance Group, Inc. 1,548,332 796,979*
SEMICONDUCTORS 4.15%
- ----------------------------------------------------------------------------------------
Hynix Semiconductor, Inc. 16,000 558,379*
Taiwan Semiconductor Manufacturing Co., Ltd., Sponsored
ADR 100,000 991,000
-----------
1,549,379
SILVER MINING 1.61%
- ----------------------------------------------------------------------------------------
Silvercorp Metals, Inc. 100,000 450,392*
Silvercorp Metals, Inc., Warrants (February 2006) 144A 50,000 150,131*
-----------
600,523
- ----------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 34,700,152
- ----------------------------------------------------------------------------------------
(cost $27,562,571)
PRINCIPAL
REPURCHASE AGREEMENT 5.72% AMOUNT
Joint Tri-Party Repurchase Agreement, Morgan Stanley
Dean Witter, 12/30/05, 3.45%, due 01/03/06,
repurchase price $2,133,486, collateralized by U.S.
Treasury securities held in a joint tri-party
repurchase account (cost $2,132,668) $2,132,668 2,132,668
- ----------------------------------------------------------------------------------------
TOTAL INVESTMENTS 98.69% 36,832,820
- ----------------------------------------------------------------------------------------
(cost $29,695,239)
Other assets and liabilities, net 1.31% 490,111
-----------
NET ASSETS 100% $37,322,931
-----------
See notes to portfolios of investments and notes to financial statements.
63
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS 93.20% SHARES VALUE
ALUMINUM 1.97%
- --------------------------------------------------------------------------------------------
Alcan, Inc. 200,000 $ 8,190,000
Alcoa, Inc. 200,000 5,914,000
Global Alumina Products Corp. 800,000 1,368,000*
Global Alumina Products Corp., Warrants (January 2006) 400,000 84,000*
------------
15,556,000
BUILDING MATERIALS 0.12%
- --------------------------------------------------------------------------------------------
Florida Rock Industries, Inc. 20,000 981,200
CHEMICALS - AGRICULTURAL 0.41%
- --------------------------------------------------------------------------------------------
Potash Corporation of Saskatchewan, Inc. 40,000 3,208,800
CHEMICALS - DIVERSIFIED 1.14%
- --------------------------------------------------------------------------------------------
E.I. du Pont de Nemours and Co. 75,000 3,187,500
NOVA Chemicals Corp. 173,800 5,804,920
------------
8,992,420
COAL 4.90%
- --------------------------------------------------------------------------------------------
Arch Coal, Inc. 110,000 8,745,000
Coalcorp Mining, Inc. 3,040,000 1,486,553*+
Coalcorp Mining, Inc., Warrants (March 2006) 550,000 0*
Coalcorp Mining, Inc., Warrants (September 2007) (RS) 500,000 0*
CONSOL Energy, Inc. 130,000 8,473,400
Fording Canadian Coal Trust 140,000 4,835,205
Macarthur Coal Ltd. 675,000 2,550,698
NEMI Northern Energy & Mining, Inc. 1,514,460 1,961,854*
Peabody Energy Corp. 110,000 9,066,200
Western Canadian Coal Corp. 410,000 1,234,590*
Western Canadian Coal Corp., Warrants (June 2006) 145,000 250,032*
------------
38,603,532
COPPER 1.70%
- --------------------------------------------------------------------------------------------
African Copper plc 1,530,000 1,248,956*
Amerigo Resources Ltd. 761,600 1,528,884
Constellation Copper Corp. 5,166,900 6,205,688*
Revett Minerals, Inc. 1,879,500 1,209,304*
Tenke Mining Corp. 410,000 3,218,376*
------------
13,411,208
DATA PROCESSING & SOFTWARE 0.01%
- --------------------------------------------------------------------------------------------
Stockgroup Information Systems, Inc. 153,000 45,900*
See notes to portfolios of investments and notes to financial statements.
64
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
DIAMOND MINING & EXPLORATION 0.04%
- --------------------------------------------------------------------------------------------
Diamond Fields International Ltd. 112,000 $ 16,334*
Diamond Fields International Ltd., Warrants (November
2006) 112,000 0*
Diamonds North Resources Ltd. 150,000 111,955*
Metalex Ventures Ltd. 30,000 19,302*
Vaaldiam Resources Ltd. 250,000 144,769*
------------
292,360
FINANCIAL SERVICES 1.74%
- --------------------------------------------------------------------------------------------
Dundee Wealth Management, Inc. 550,000 4,760,863
GMP Capital Trust 473,600 7,280,841
Jovian Capital Corp. 2,008,500 1,654,150*
------------
13,695,854
FORESTRY 0.28%
- --------------------------------------------------------------------------------------------
TimberWest Forest Corp. 170,000 2,245,957
GAS & PROPANE DISTRIBUTION 0.96%
- --------------------------------------------------------------------------------------------
Energy Savings Income Fund 220,000 3,584,095
ONEOK, Inc. 150,000 3,994,500
------------
7,578,595
GENERAL METAL & MINERAL MINING 3.74%
- --------------------------------------------------------------------------------------------
Altius Minerals Corp. 100,000 367,177*
Atacama Minerals Corp. 500,000 364,603*
Breakwater Resources Ltd., Warrants (January 2009) 2,115,000 453,610*
Central African Mining & Exploration Co., plc 2,245,000 491,913*
European Nickel plc 350,000 166,914*
Farallon Resources Ltd. 130,000 69,146*
First Point Minerals Corp. 2,000 214*
HudBay Minerals, Inc. 625,000 3,158,109*
HudBay Minerals, Inc., Warrants (December 2009) 16,383,000 1,405,482*
International Molybdenum plc 1,971,670 864,045*
International Molybdenum plc, Warrants (July 2010) 958,335 144,108*
JSC MMC Norilsk Nickel, ADR 20,000 1,900,000
Labrador Iron Ore Royalty Trust 150,000 3,443,572
LionOre Mining International Ltd. 175,000 743,148*
Lundin Mining Corp. 88,125 1,273,887*
Precious Metals Australia Ltd. 1,000,000 1,063,937*
Sterling Group Ventures, Inc. 525,700 89,369*
Sterling Group Ventures, Inc., Warrants (February
2006) 500,000 0*
Teck Cominco Ltd., Class B 220,000 11,711,062
Titanium Resources Group Ltd. 1,000,000 970,981*
Toledo Mining Corp. plc 345,200 780,115*
See notes to portfolios of investments and notes to financial statements.
65
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
GENERAL METAL & MINERAL MINING (CONT'd)
- --------------------------------------------------------------------------------------------
Zimasco Consolidated Enterprises Ltd. (RS) 22,000 $ 4,840*
------------
29,466,232
GOLD & COPPER MINING 2.67%
- --------------------------------------------------------------------------------------------
Continental Minerals Corp. 200,000 291,683*
European Minerals Corp. 368,250 309,600*
European Minerals Corp., Warrants (December 2008) 169,125 39,174*
Fortress Minerals Corp. 200,000 185,304*
Ivanhoe Mines Ltd. 490,000 3,510,059*
Northern Dynasty Minerals Ltd. 410,000 2,163,171*
Northern Dynasty Minerals Ltd., Warrants (September
2006) 400,000 394,630*
Northern Orion Resources, Inc. 3,107,900 10,105,017*
Northern Orion Resources, Inc., Warrants (May 2008) 816,100 1,435,255*
Northern Orion Resources, Inc., Warrants (February
2010) 175,000 105,092*
Northgate Minerals Corp. 1,130,000 2,064,856*
Northgate Minerals Corp., Warrants (December 2006) 861,000 184,661*
Taseko Mines Ltd. 250,000 304,551*
Taseko Mines Ltd., Warrants (September 2006) 500,000 0*
------------
21,093,053
GOLD MINING 5.09%
- --------------------------------------------------------------------------------------------
Agnico-Eagle Mines Ltd., Warrants (November 2007) 15,000 66,150*
Bema Gold Corp., Warrants (October 2007) 429,000 651,422*
Bolivar Gold Corp. 2,432,500 6,114,378*
Bolivar Gold Corp., Warrants (March 2008) 455,300 753,853*
Bolivar Gold Corp., Warrants (August 2008) 388,700 426,831*
Caledon Resources plc 1,470,000 85,262*
Cambior, Inc., Warrants (August 2008) 32,000 23,335*
Century Mining Corp. 36,585 12,241*
Century Mining Corp., Warrants (March 2007) 500,000 0*
China NetTV Holdings, Inc. 649,750 123,452*
Corona Gold Ltd. 50,000 367*
Crowflight Minerals, Inc. 1,160,000 213,958*
Dumont Nickel, Inc. 500,000 47,184*
Entree Gold, Inc. 495,000 734,654*
Glencairn Gold Corp. 700,000 258,225*
Glencairn Gold Corp., Warrants (November 2008) 345,000 29,597*
Gold Fields Ltd. 50,000 881,009
Gold Fields Ltd., Sponsored ADR 60,000 1,057,800
Goldcorp, Inc. 260,000 5,792,865
Goldcorp, Inc., Warrants (March 2007), Class C 478,950 1,992,800*
Goldcorp, Inc., Warrants (April 2007) 6,500 143,000*
Goldcorp, Inc., Warrants (May 2007), Class A 526,750 2,191,685*
Goldcorp, Inc., Warrants (August 2008), Class B 1,119,100 3,408,231*
Goldcorp, Inc., Warrants (May 2009) 1,400 41,941*
See notes to portfolios of investments and notes to financial statements.
66
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD MINING (CONT'D)
- ------------------------------------------------------------------------------------------
Great Basin Gold Ltd. 49,000 $ 75,780*
International Royalty Corp. 480,000 1,441,256*
IAMGOLD Corp. 280,000 2,200,317
Kinross Gold Corp., Warrants (December 2007) 145,000 53,489*
Medoro Resources Ltd. 908,000 62,317*
Metallic Ventures Gold, Inc. 10,000 17,844*
Metallica Resources, Inc. 276,000 509,072*
Metallica Resources, Inc., Warrants (December 2008) 200,000 96,942*
Mexgold Resources, Inc. 310,000 1,297,817*
Mexgold Resources, Inc., Warrants (March 2006) 150,000 306,267*
Moss Lake Gold Mines Ltd. 3,000 437*
Nevada Pacific Gold Ltd. 371,648 286,950*
New Sleeper Gold Corp. 200,000 58,337*
New Sleeper Gold Corp., Warrants (December 2008) 100,000 0*
Olympus Pacific Minerals, Inc. 485,000 149,788*
Pacific Ridge Exploration Ltd. 125,000 6,434*
Pacific Rim Mining Corp. 105,000 78,749*
Planet Exploration, Inc. 160,000 43,924*
QGX Ltd. 380,000 1,369,193*
Radius Gold, Inc. 9,600 5,271*
Randgold Resources Ltd., ADR 20,000 322,600*
Red Back Mining, Inc. 820,000 1,920,474*
Red Back Mining, Inc., Warrants (July 2007) 150,000 93,939*
Ridge Mining plc 575,000 348,329*
Rio Narcea Gold Mines Ltd., Warrants (September 2008) 217,500 28,922*
Royal Roads Corp. 1,510,000 129,541*
Silk Road Resources Ltd. 265,000 159,139*
Stingray Resources, Inc. 125,000 64,342*
TLC Ventures Corp. 208,300 232,308*
TVI Pacific, Inc. 4,821,428 475,670*
Vedron Gold, Inc. 10,991 4,102*
Virginia Gold Mines, Inc. 100,000 999,442*
Wolfden Resources, Inc. 691,800 2,195,908*
X-Cal Resources Ltd. 412,500 92,009*
------------
40,177,149
INDUSTRIAL GASES 0.17%
- --------------------------------------------------------------------------------------------
Praxair, Inc. 25,000 1,324,000
INVESTMENT COMPANY 0.80%
- --------------------------------------------------------------------------------------------
ASA Bermuda Ltd. 115,000 6,326,150
INVESTMENT TRUST 0.57%
- --------------------------------------------------------------------------------------------
streetTRACKS Gold Trust 87,500 4,513,250*
See notes to portfolios of investments and notes to financial statements.
67
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
MINING EQUIPMENT & SERVICES 1.45%
- --------------------------------------------------------------------------------------------
Dynatec Corp. 4,428,700 $ 4,597,201*
Joy Global, Inc. 170,000 6,800,000
------------
11,397,201
OIL & GAS - INTEGRATED 7.40%
- --------------------------------------------------------------------------------------------
ConocoPhillips 150,000 8,727,000
Novy Neft II Limited 60,000 1,785,300*
Petro-Canada 190,000 7,617,100
PetroChina Co., Ltd., ADR 85,000 6,966,600
Petroleo Brasileiro S.A., ADR 350,000 22,529,500
Suncor Energy, Inc. 170,000 10,732,100
------------
58,357,600
OIL & GAS DRILLING 7.35%
- --------------------------------------------------------------------------------------------
Diamond Offshore Drilling, Inc. 100,000 6,956,000
Global Santa Fe Corp. 85,000 4,092,750
Helmerich & Payne, Inc. 65,000 4,024,150
High Arctic Energy Services Trust 103,700 1,143,178
Leader Energy Services Ltd. 512,000 1,861,919*
Nabors Industries, Ltd. 80,000 6,060,000*
Precision Drilling Trust 200,000 6,585,167
Rowan Companies, Inc. 230,000 8,197,200
Savanna Energy Services Corp. 120,000 2,944,280*
Todco, Class A 200,750 7,640,545*
Transocean, Inc. 50,000 3,484,500*
Trinidad Energy Services Income Trust 365,000 4,953,717
------------
57,943,406
OIL & GAS EQUIPMENT & SERVICES 14.37%
- --------------------------------------------------------------------------------------------
Basic Energy Services, Inc. 10,000 199,500*
Cal Dive International, Inc. 80,000 2,871,200*
Calfrac Well Services Ltd. 229,500 7,934,500
Global Industries Ltd. 300,000 3,405,000*
Grant Prideco, Inc. 270,000 11,912,400*
GulfMark Offshore, Inc. 140,000 4,146,800*
Halliburton Co. 120,000 7,435,200
Hornbeck Offshore Services, Inc. 230,000 7,521,000*
Hyduke Energy Services, Inc., Units (RS) 525,000 1,382,254*
McDermott International, Inc. 255,000 11,375,550*
National-Oilwell, Inc. 255,000 15,988,500*
Oil States International, Inc. 185,000 5,860,800*
Producers Oilfield Services, Inc. 400,000 3,174,195*
Saxon Energy Services, Inc. 750,000 3,506,627*
Saxon Energy Services, Inc. (RS) 360,000 1,599,176*
See notes to portfolios of investments and notes to financial statements.
68
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
OIL & GAS EQUIPMENT & SERVICES (Cont'd)
- --------------------------------------------------------------------------------------------
Saxon Energy Services, Inc., Warrants (April 2006) 187,500 $ 0*
Saxon Energy Services, Inc., Warrants (November 2006)
(RS) 180,000 0*
Tidewater, Inc. 100,000 4,446,000
Trican Well Service Ltd. 173,250 8,323,253*
Weatherford International Ltd. 245,958 8,903,680*
W-H Energy Services, Inc. 100,000 3,308,000*
------------
113,293,635
OIL & GAS EXPLORATION & PRODUCTION - JUNIOR 9.83%
- --------------------------------------------------------------------------------------------
Anderson Energy Ltd. 50,000 332,433*
Bankers Petroleum Ltd. 2,650,000 3,205,508*
Bankers Petroleum Ltd., Warrants (November 2009) 2,212,000 1,613,006*
Big Sky Energy Corp. 2,614,650 4,523,344*
Big Sky Energy Corp. (RS) 1,000,000 1,643,500*
BlackRock Ventures, Inc. 500,000 4,932,870*
Choice Resources Corp. 1,773,000 1,551,461*
Choice Resources Corp., Warrants (March 2006) 1,000,000 17,158*
Duvernay Oil Corp. 125,000 4,743,062*
Energy XXI Acquisition Corp. 424,000 2,234,480*
Energy XXI Acquisition Corp., Warrants (October 2009) 790,000 442,400*
Galleon Energy, Inc., Class A 120,000 2,522,198*
Gastar Exploration Ltd. 200,000 729,207*
Gastar Exploration Ltd. (RS) 600,000 2,056,363*
Grove Energy Ltd. 1,000,000 566,208
Grove Energy Ltd., Warrants (April 2006) 600,000 133,831*
Innova Exploration Ltd. 400,000 2,333,462*
Pacific Stratus Energy Ltd. 7,183,000 1,725,424*+
Pacific Stratus Energy Ltd., Warrants (August 2006) 1,500,000 0*
Pacific Stratus Energy Ltd., Warrants (July 2007) 1,600,000 0*
Pan-Ocean Energy Corp., Ltd. 152,000 3,520,782*
PetroWorld Corp. 2,000,000 1,340,025*+
PetroWorld Corp., Warrants (July 2010) 1,000,000 0*
Real Resources, Inc. 175,000 3,738,258*
Synenco Energy, Inc., Class A, Voting Shares 348,000 5,087,222*
Tanganyika Oil Co., Ltd. 200,000 1,494,445*
Tyner Resources Ltd. 890,000 878,051*
Tyner Resources Ltd., Warrants (May 2007) 425,000 54,690
Valkyries Petroleum Corp. 700,000 4,197,658*
White Nile Ltd. 13,002,000 21,450,804*+
Zenas Energy Corp. (RS) 100,000 427,873*
------------
77,495,723
OIL & GAS EXPLORATION & PRODUCTION - SENIOR 8.24%
- --------------------------------------------------------------------------------------------
Carrizo Oil & Gas, Inc. 162,700 4,020,317*
EnCana Corp. 230,000 10,380,565
See notes to portfolios of investments and notes to financial statements.
69
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
OIL & GAS EXPLORATION & PRODUCTION - SENIOR (CONT'D)
- -----------------------------------------------------------------------------------------
Goodrich Petroleum Corp. 380,000 $ 9,557,000*
Southwestern Energy Co. 260,000 9,344,400*
Talisman Energy, Inc. 100,000 5,284,605
Warren Resources, Inc. 390,000 6,169,800*
Western Gas Resources, Inc. 115,000 5,415,350
Whiting Petroleum Corp. 150,000 6,000,000*
XTO Energy, Inc. 200,000 8,788,000
------------
64,960,037
OIL & GAS REFINING & MARKETING 4.74%
- --------------------------------------------------------------------------------------------
Sunoco, Inc. 200,000 15,676,000
Valero Energy Corp. 420,000 21,672,000
------------
37,348,000
OIL & GAS ROYALTY TRUSTS 9.10%
- --------------------------------------------------------------------------------------------
Acclaim Energy Trust 365,000 5,933,814
ARC Energy Trust 115,000 2,613,434
Bonavista Energy Trust 265,000 8,661,691
Canadian Oil Sands Trust 50,000 5,404,710
Daylight Energy Trust 325,000 3,465,663
Enerplus Resources Fund 140,000 6,717,206
Esprit Energy Trust 510,000 5,889,075
Fairborne Energy Trust 5,500 77,854
Focus Energy Trust 200,000 4,412,988
Harvest Energy Trust 300,000 9,571,484
Penn West Energy Trust 210,000 6,844,164
Progress Energy Trust 100,000 1,472,998
San Juan Basin Royalty Trust 127,400 5,552,092
Sequoia Oil & Gas Trust 295,000 5,129,885
------------
71,747,058
PLATINUM GROUP METALS 0.59%
- --------------------------------------------------------------------------------------------
African Minerals, Special Warrants (RS) 12,500 75,000*
African Platinum plc 6,550,000 2,504,572*
Anooraq Resources Corp. 750,000 527,603*
Aquarius Platinum Ltd. 6,862 55,385
Atikwa Minerals Corp. 40,000 1,544*
Beartooth Platinum Corp. 2,180,000 271,179*
Eastern Platinum Ltd. 794,500 920,152*
Eastern Platinum Ltd., Warrants (March 2006) 250,000 0*
Eastern Platinum Ltd., Warrants (April 2008) 57,500 16,772*
Osmium Holdings S.A. (RS) 104 10,400*
Platinum Group Metals Ltd. 239,700 302,285*
See notes to portfolios of investments and notes to financial statements.
70
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
PLATINUM GROUP METALS (CONT'D)
- --------------------------------------------------------------------------------------------
SouthernEra Resources Ltd., Warrants (November 2006) 100,000 $ 3,860*
------------
4,688,752
POTASH & AGRICULTURAL FERTILIZERS 0.06%
- --------------------------------------------------------------------------------------------
Spur Ventures, Inc. 435,000 481,405*
POWER TECHNOLOGY 0.00%
- --------------------------------------------------------------------------------------------
Dynex Power, Inc. 660,000 36,803*
Dynex Power, Inc., Warrants (August 2006) 330,000 0*
------------
36,803
SILVER MINING 2.14%
- --------------------------------------------------------------------------------------------
Pan American Silver Corp., Warrants (February 2008) 54,900 533,622*
Silver Wheaton Corp. 428,300 2,480,183*
Silver Wheaton Corp., Units 1,365,000 8,899,755*
Silver Wheaton Corp., Warrants (August 2009) 3,529,250 1,998,288*
Silver Wheaton Corp., Warrants (November 2009) 1,755,000 828,079*
Silvercorp Metals, Inc. 65,000 292,755*
Silvercorp Metals, Inc. (RS) 400,000 1,711,663*
Silvercorp Metals, Inc., Warrants (September 2006)
(RS) 200,000 106,035*
------------
16,850,380
STEEL 0.59%
- --------------------------------------------------------------------------------------------
Russel Metals, Inc. 250,000 4,686,227
URANIUM 1.03%
- --------------------------------------------------------------------------------------------
Khan Resources, Inc., Special Warrants (RS) 400,000 343,156*
UMC Energy plc 1,000,000 455,416*+
UMC Energy plc, Warrants (January 2007) 500,000 0*
UrAsia Energy Ltd. 1,408,600 2,622,281*
Western Prospector Group Ltd. 1,102,000 4,726,976*
------------
8,147,829
- --------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 734,945,716
- --------------------------------------------------------------------------------------------
(cost $582,725,170)
PRINCIPAL
CONVERTIBLE DEBENTURES 0.68% AMOUNT
COAL 0.32%
- --------------------------------------------------------------------------------------------
Coalcorp Mining, Inc., 1.00%, maturity 9/22/06 $ 2,500,000 2,500,000
See notes to portfolios of investments and notes to financial statements.
71
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
PRINCIPAL
CONVERTIBLE DEBENTURES AMOUNT
GOLD MINING 0.06%
- --------------------------------------------------------------------------------------------
Bolivar Gold Corp., 6.00%, maturity 12/04/08 CAD $ 250,000 $ 220,493
Century Mining Corp., 10.00%, maturity 12/31/06 CAD 285,000 244,498
------------
464,991
OIL & GAS EXPLORATION & PRODUCTION - JUNIOR 0.30%
- --------------------------------------------------------------------------------------------
1078352 Alberta Ltd., 10.00%, maturity 12/15/07
(RS) CAD 1,000,000 857,891
Gastar Exploration Ltd., 9.75%, maturity 11/12/09 1,500,000 1,500,000
------------
2,357,891
- --------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE DEBENTURES 5,322,882
- --------------------------------------------------------------------------------------------
(cost $5,101,504)
PURCHASED OPTIONS 1.52% CONTRACTS
CHEMICALS - DIVERSIFIED 0.08%
- --------------------------------------------------------------------------------------------
Lyondell Chemical Co., Strike Price 30, Call,
Expiration Jan. 2007 (premium $470,482) 1,500 202,500
The Dow Chemical Co., Strike Price 45, Call,
Expiration Jan. 2007 (premium $411,990) 1,000 410,000
------------
612,500
COAL 0.29%
- --------------------------------------------------------------------------------------------
Peabody Energy Corp., Strike Price 70, Call,
Expiration Jan. 2007 (premium $2,075,749) 1,000 2,280,000
GENERAL METAL & MINERAL MINING 0.03%
- --------------------------------------------------------------------------------------------
Inco Ltd., Strike Price 50, Call, Expiration Jan. 2007
(premium $228,403) 571 216,980
GOLD MINING 0.01%
- --------------------------------------------------------------------------------------------
Philadelphia Stock Exchange Gold & Silver Index,
Strike Price 115, Put, Expiration Jan. 2006 (premium
$231,625) 1,000 30,000
Philadelphia Stock Exchange Gold & Silver Index,
Strike Price 90, Put, Expiration Mar. 2006 (premium
$243,168) 2,200 55,000
------------
85,000
INDEX FUND 0.71%
- --------------------------------------------------------------------------------------------
Energy Select Sector SPDR Fund, Strike Price 40, Put,
Expiration Jan. 2007 (premium $237,000) 1,000 117,500
See notes to portfolios of investments and notes to financial statements.
72
GLOBAL RESOURCES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
PURCHASED OPTIONS 1.52% CONTRACTS VALUE
INDEX FUND (CONT'D)
- --------------------------------------------------------------------------------------------
Energy Select Sector SPDR Fund, Strike Price 45, Call,
Expiration Jan. 2006 (premium $623,000) 1,000 $ 570,000
Oil Service HOLDRS Trust, Strike Price 110, Call,
Expiration Jan. 2007 (premium $3,327,589) 1,663 4,955,740
------------
5,643,240
OIL & GAS DRILLING 0.26%
- --------------------------------------------------------------------------------------------
Transocean, Inc., Strike Price 60, Call, Expiration
Jan. 2008 (premium $1,344,530) 1,000 2,070,000
OIL & GAS REFINING & MARKETING 0.14%
- --------------------------------------------------------------------------------------------
Tesoro Corp., Strike Price 50, Call, Expiration Jan.
2008 (premium $996,641) 500 1,087,500
- --------------------------------------------------------------------------------------------
TOTAL PURCHASED OPTIONS 11,995,220
- --------------------------------------------------------------------------------------------
(cost $10,190,177)
- --------------------------------------------------------------------------------------------
TOTAL SECURITIES 752,263,818
- --------------------------------------------------------------------------------------------
PRINCIPAL
REPURCHASE AGREEMENT 4.02% AMOUNT
Joint Tri-Party Repurchase Agreement, Morgan Stanley
Dean Witter, 12/30/05, 3.45%, due 01/03/06,
repurchase price $31,743,834, collateralized by
U.S. Treasury securities held in a joint tri-party
repurchase account (cost $31,731,670) $31,731,670 31,731,670
- --------------------------------------------------------------------------------------------
TOTAL INVESTMENTS 99.42% 783,995,488
- --------------------------------------------------------------------------------------------
(cost $629,748,521)
Other assets and liabilities, net 0.58% 4,571,386
------------
NET ASSETS 100% $788,566,874
------------
See notes to portfolios of investments and notes to financial statements.
73
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS 93.99% SHARES VALUE
DATA PROCESSING & SOFTWARE 0.09%
- ---------------------------------------------------------------------------------------------
Stockgroup Information Systems, Inc. 1,050,000 $ 315,000*
DIAMOND MINING & EXPLORATION 2.01%
- ---------------------------------------------------------------------------------------------
Aber Diamond Corp. 87,000 3,207,129
Diagem International Resource Corp. 800,000 58,337*
Diamond Fields International Ltd. 1,296,000 189,010*
Diamond Fields International Ltd., Warrants
(November 2006) 512,000 0*
Diamonds North Resources Ltd. 2,227,000 1,662,154*+
Metalex Ventures Ltd. 70,000 45,039*
Shore Gold, Inc. 175,000 1,153,005*
Tahera Diamond Corp. 800,000 480,419*
Vaaldiam Resources Ltd. 760,000 440,098*
------------
7,235,191
ENERGY - ALTERNATIVE SOURCES 0.00%
- ---------------------------------------------------------------------------------------------
Altek Power Corp. 18,000 2,162*
FINANCIAL SERVICES 2.15%
- ---------------------------------------------------------------------------------------------
Dundee Wealth Management, Inc. 291,000 2,518,929
GMP Capital Trust 192,300 2,956,304
Jovian Capital Corp. 2,000,000 1,647,150*
NETeller plc 50,000 631,567*
------------
7,753,950
GOLD ROYALTY COMPANY 0.06%
- ---------------------------------------------------------------------------------------------
Royal Gold, Inc. 6,000 208,380
GOLD/MINERAL EXPLORATION & DEVELOPMENT 22.44%
- ---------------------------------------------------------------------------------------------
African Minerals, Special Warrants (RS) 112,500 675,000*
African Platinum plc 16,260,000 6,217,456*
AfriOre Ltd. 1,590,000 3,860,250*
Alamos Gold, Inc. 575,000 3,240,896*
Amarc Resources Ltd. 509,545 126,769*
American Gold Capital Corp. 200,000 154,420*
Amerix Precious Metals Corp. 445,000 148,887*
AMT International Mining Corp. 1,000,000 14,584*
Anooraq Resources Corp. 2,714,100 1,909,288*
Atikwa Minerals Corp. 1,583,333 61,125*
Bendigo Mining NL 1,201,000 1,454,036*
Caledon Resources plc 18,890,000 1,095,640*+
Candente Resource Corp. 215,000 123,579*
Central African Gold plc 4,015,000 310,499*
Central African Mining & Exploration Co., plc 2,025,000 443,708*
See notes to portfolios of investments and notes to financial statements.
74
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD/MINERAL EXPLORATION & DEVELOPMENT (CONT'D)
- ------------------------------------------------------------------------------------------
Chilean Gold Ltd. (RS) 500,000 $ 0*
Coalcorp Mining, Inc. 522,500 255,501*
Continental Minerals Corp. 690,000 1,006,305*
Continental Precious Minerals, Inc. 200,000 145,841*
Corona Gold Ltd. 812,500 5,962*
Corriente Resources, Inc. 440,000 1,570,282*
Dumont Nickel, Inc. 1,575,000 148,630*
Eastern Platinum Ltd. 3,314,825 3,839,072*
Eastern Platinum Ltd., Warrants (March 2006) 500,000 0*
Eastern Platinum Ltd., Warrants (April 2008) 312,500 91,151*
ECU Silver Mining, Inc. 930,000 351,049*
Erdene Gold, Inc. 403,500 360,005*
European Minerals Corp. 956,000 803,740*
European Minerals Corp., Warrants (December 2008) 413,500 95,779*
European Nickel plc 400,000 190,759*
EXMIN Resources, Inc. 1,065,000 137,048*
EXMIN Resources, Inc., Warrants (February 2007) 500,000 0*
Farallon Resources Ltd. 2,241,000 1,191,970*
First Point Minerals Corp. 1,100,000 117,960*
Fortress Minerals Corp. 125,500 116,278*
Gabriel Resources Ltd. 216,700 527,970*
Gold Reserve, Inc. 250,000 723,040*
Gold Summit Corp. 317,000 74,787*
Golden China Resources Corp. 1,525,000 405,568*
Golden Odyssey Mining, Inc. 1,255,000 236,864*+
Grandview Gold, Inc. (RS) 400,000 329,430*
Grandview Gold, Inc., Warrants (August 2006) (RS) 200,000 0*
Great Basin Gold Ltd. 1,350,000 2,084,674*
Inca Pacific Resources, Inc. 160,000 62,454*
Inca Pacific Resources, Inc., Warrants (November 2006) 900,000 0*
International Molybdenum plc 1,105,000 484,244*
Ivanhoe Mines Ltd. 742,000 5,315,203*
Latitude Resources plc 3,000,000 277,116*
Laurion Gold, Inc., Special Warrants 1,500,000 25,737*
Medoro Resources Ltd. 700,000 48,042*
Metallic Ventures Gold, Inc. 1,175,000 2,096,684*
Metallic Ventures Gold, Inc., Warrants (March 2009) 50,000 7,507*
Metallica Resources, Inc. 315,000 581,006*
Metallica Resources, Inc., Warrants (December 2008) 540,000 261,742*
Moto Goldmines Ltd. 290,500 882,228*
Moto Goldmines Ltd., Warrants (August 2007) 137,500 34,208*
Nevsun Resources Ltd. 50,000 90,079*
New Sleeper Gold Corp. 895,000 261,056*
New Sleeper Gold Corp., Warrants (December 2008) 150,000 0*
Northern Dynasty Minerals Ltd. 542,700 2,863,299*
Northern Dynasty Minerals Ltd., Warrants
(September 2006) 100,000 98,657*
See notes to portfolios of investments and notes to financial statements.
75
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD/MINERAL EXPLORATION & DEVELOPMENT (CONT'D)
- ---------------------------------------------------------------------------------------------
NovaGold Resources, Inc. 10,000 $ 90,164*
Odyssey Resources Ltd. 1,240,000 101,060*
Olympus Pacific Minerals, Inc. 762,000 235,337*
Osmium Holdings S.A. (RS) 891 89,100*
Oxus Gold plc 250,000 336,191*
Pacific North West Capital Corp. 1,520,466 391,318*
Pan American Silver Corp. 10,000 188,300*
Pan American Silver Corp., Warrants (February 2008) 277,950 2,701,646*
Peru Copper Corp. 225,600 625,134*
Peru Copper Corp., Warrants (March 2006) 160,375 133,457*
Planet Exploration, Inc. 310,000 85,103*
Platinum Group Metals Ltd. 425,000 535,967*
Platte River Gold, Special Warrants (RS) 595,000 1,190,000*
QGX Ltd. 848,000 3,055,463*
Radius Gold, Inc. 735,700 403,936*
Ridge Mining plc 1,180,000 714,831*
Romarco Minerals, Inc. 2,271,000 331,206*+
Romarco Minerals, Inc. (RS) 5,682,353 789,723*+
Romarco Minerals, Inc., Warrants (September 2007) (RS) 5,682,353 0*
Rubicon Minerals Corp. 210,000 180,157*
Silvercorp Metals, Inc. 851,500 3,835,092*
Silvercorp Metals, Inc., Warrants (February 2006) 144A 400,000 1,201,047*
Solitario Resources Corp. 257,700 400,152*
Southwestern Resources Corp. 35,000 405,654*
St. Andrew Goldfields Ltd. 4,800,000 638,270*
Stingray Resources, Inc. 300,000 154,420*
Stratagold Corp. 1,137,500 751,405*
Strongbow Exploration, Inc. 810,000 291,854*
Sydney Resource Corp. 600,000 236,778*
Sydney Resources Corp., Warrants (March 2006) 300,000 0*
Tenke Mining Corp. 241,400 1,894,917*
TLC Ventures Corp. 644,700 719,007*
UGL Enterprises Ltd. 210,000 65,757*
Vedron Gold, Inc. 4,942,379 1,844,409*+
Verena Minerals Corp. 1,000,000 167,289*
Victoria Resources Corp. 90,000 45,554*
Western Exploration & Development Ltd., 144A, Special
Warrants (RS) 600,000 30,000*
Western Prospector Group Ltd. 803,000 3,444,430*
White Knight Resource Ltd. 1,315,000 1,929,095*
Wolfden Resources, Inc. 620,000 1,968,001*
X-Cal Resources Ltd. 2,418,000 539,339*
Yilgarn Mining Ltd. 19,026 2,722*
------------
80,778,349
See notes to portfolios of investments and notes to financial statements.
76
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
INTERMEDIATE & JUNIOR GOLD PRODUCERS 47.82%
- ---------------------------------------------------------------------------------------------
Agnico-Eagle Mines Ltd., Warrants (November 2007) 622,100 $ 2,744,577*
Apollo Gold Corp. 810,950 180,884*
Apollo Gold Corp., Warrants (December 2006) 333,500 0*
Bema Gold Corp., Warrants (October 2007) 3,984,460 6,050,267*
Bolivar Gold Corp. 4,417,500 11,103,912*
Bolivar Gold Corp., Warrants (March 2008) 1,175,000 1,945,481*
Bolivar Gold Corp., Warrants (August 2008) 2,108,900 2,315,783*
Bolivar Gold Corp., Warrants (March 2009) 1,000 335*
Cambior, Inc. 1,114,500 3,109,461*
Cambior, Inc., Warrants (October 2006) 145,000 24,879*
Cambior, Inc., Warrants (August 2008) 420,785 306,839*
Century Mining Corp. 361,883 121,077*
Century Mining Corp., Warrants (March 2007) 500,000 0*
Coeur d'Alene Mines Corp. 150,000 600,000*
Desert Sun Mining Corp. 70,000 171,750*
Desert Sun Mining Corp., Warrants (November 2008) 85,000 80,213*
Dynatec Corp. 3,745,200 3,887,695*
Emperor Mines Ltd. 980,000 266,058*
Frontier Pacific Mining Corp. 1,232,000 211,384*
Frontier Pacific Mining Corp., Warrants (April 2006) 200,000 0*
Gallery Gold Ltd. 900,000 310,376*
Glamis Gold Ltd. 30,000 824,134*
Glencairn Gold Corp. 3,088,500 1,139,326*
Glencairn Gold Corp., Warrants (November 2008) 1,321,500 113,370*
Goldcorp, Inc., Warrants (March 2007), Class C 3,748,150 15,595,185*
Goldcorp, Inc., Warrants (April 2007) 144,700 3,183,400*
Goldcorp, Inc., Warrants (May 2007), Class A 3,402,825 14,158,368*
Goldcorp, Inc., Warrants (August 2008), Class B 3,523,110 10,729,671*
Goldcorp, Inc., Warrants (May 2009) 104,800 3,139,550*
Golden Star Resources Ltd., Warrants (February 2007) 27,500 15,807*
Hecla Mining Co. 280,000 1,136,800*
Herald Resources Ltd. 1,000,000 480,606*
High River Gold Mines Ltd. 530,000 672,929*
IAMGOLD Corp. 457,000 3,591,232
Kingsgate Consolidated Ltd. 50,000 168,763
Kinross Gold Corp. 85,000 783,168*
Kinross Gold Corp., Warrants (December 2007) 2,745,000 1,012,611*
Leviathan Resources Ltd. 166,666 125,960*
LionOre Mining International Ltd. 205,570 868,204*
Meridian Gold, Inc. 427,000 9,337,504*
Mexgold Resources, Inc. 1,391,400 5,825,104*
Mexgold Resources, Inc., Warrants (March 2006) 250,000 510,445*
Moss Lake Gold Mines Ltd. 2,390,500 348,634*+
Nevada Pacific Gold Ltd. 2,986,835 2,306,140*+
Northern Orion Resources, Inc. 7,422,000 24,131,843*
Northern Orion Resources, Inc., Warrants (May 2008) 2,887,550 5,078,263*
See notes to portfolios of investments and notes to financial statements.
77
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
Northern Orion Resources, Inc., Warrants (February
2010) 176,500 $ 105,992*
Northgate Minerals Corp. 1,612,000 2,945,618*
Northgate Minerals Corp., Warrants (December 2006) 3,827,600 820,915*
Pacific Rim Mining Corp. 5,030,100 3,771,617*+
Randgold Resources Ltd., ADR 829,325 13,377,012*
Red Back Mining, Inc. 1,181,900 2,768,058*
Red Back Mining, Inc., Warrants (July 2007) 150,000 93,939*
Resolute Mining Ltd. 1,278,333 1,083,363*
Rio Narcea Gold Mines Ltd., Warrants (September 2008) 1,108,750 147,434*
Sino Gold Ltd. 680,000 1,746,325*
Troy Resources NL 208,800 493,327
TVI Pacific, Inc. 8,218,356 810,802*
Yamana Gold, Inc. 801,286 5,293,100*
------------
172,165,490
INVESTMENT TRUST 0.64%
- ---------------------------------------------------------------------------------------------
streetTRACKS Gold Trust 45,000 2,321,100*
METAL & MINERAL MINING 10.00%
- ---------------------------------------------------------------------------------------------
Amerigo Resources Ltd. 1,917,600 3,849,512
Aquarius Platinum Ltd. 110,045 888,201
Beartooth Platinum Corp. 2,076,500 258,304*
Breakwater Resources Ltd. 545,000 317,934*
Breakwater Resources Ltd., Warrants (January 2009) 955,000 204,821*
Constellation Copper Corp. 900,000 1,080,942*
HudBay Minerals, Inc. 235,000 1,187,449*
HudBay Minerals, Inc., Warrants (December 2009) 13,510,000 1,159,010*
International Royalty Corp. 100,000 300,262*
JSC MMC Norilsk Nickel, ADR 20,000 1,900,000
Lundin Mining Corp. 499,845 7,225,486*
North American Tungsten Corp., Ltd. 1,100,000 1,340,025*
Revett Minerals, Inc. 1,405,000 904,002*
Silver Wheaton Corp. 770,000 4,458,886*
Silver Wheaton Corp., Units 825,000 5,378,973*
Silver Wheaton Corp., Warrants (August 2009) 6,201,250 3,511,195*
Silver Wheaton Corp., Warrants (November 2009) 1,551,500 732,059*
SouthernEra Resources Ltd., Warrants (November 2006) 100,000 3,861*
Taseko Mines Ltd. 500,000 609,102*
Toledo Mining Corp. plc 260,200 588,024*
Valhalla Uranium Ltd. 172,344 60,067*
Zimasco Consolidated Enterprises Ltd. (RS) 192,500 42,350*
------------
36,000,465
See notes to portfolios of investments and notes to financial statements.
78
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
OIL & GAS EXPLORATION & PRODUCTION - JUNIOR 1.91%
- ---------------------------------------------------------------------------------------------
Aberdeen International, Inc., Units (RS) 1,000,000 $ 651,997*
Bankers Petroleum Ltd., Warrants (November 2009) 13,000 9,480*
Big Sky Energy Corp. 2,407,450 4,164,889*
Big Sky Energy Corp. (RS) 500,000 821,750*
BlackRock Ventures, Inc. 35,000 345,301*
White Nile Ltd. 543,000 895,846*
------------
6,889,263
OIL & GAS EXTRACTION 0.39%
- ---------------------------------------------------------------------------------------------
Choice Resources Corp. 606,000 530,279*
Pacific Stratus Energy Ltd. 3,625,000 870,759*
Pacific Stratus Energy Ltd., Warrants (August 2006) 562,500 0*
Pacific Stratus Energy Ltd., Warrants (July 2007) 850,000 0*
------------
1,401,038
OIL & GAS ROYALTY TRUSTS 0.48%
- ---------------------------------------------------------------------------------------------
ARC Energy Trust 5,000 113,628
Bonavista Energy Trust 5,000 163,428
Harvest Energy Trust 45,233 1,443,156
------------
1,720,212
SENIOR GOLD PRODUCERS 6.00%
- ---------------------------------------------------------------------------------------------
Barrick Gold Corp. 50,000 1,393,500
Freeport-McMoRan Copper & Gold, Inc., Class B 71,200 3,830,560
Gold Fields Ltd. 150,000 2,643,026
Gold Fields Ltd., Sponsored ADR 311,000 5,482,930
Lihir Gold Ltd. 950,000 1,519,596*
Newmont Mining Corp. 100,000 5,340,000
Placer Dome, Inc. 60,000 1,375,800
------------
21,585,412
- ---------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 338,376,012
- ---------------------------------------------------------------------------------------------
(cost $227,043,959)
See notes to portfolios of investments and notes to financial statements.
79
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
PRINCIPAL
CONVERTIBLE DEBENTURES 0.59% AMOUNT VALUE
INTERMEDIATE & JUNIOR GOLD PRODUCERS 0.59%
- ---------------------------------------------------------------------------------------------
Bolivar Gold Corp., 6.00%, maturity 12/04/08 CAD $ 750,000 $ 661,479
Century Mining Corp., 10.00%, maturity 12/31/06 CAD 1,685,000 1,445,545
------------
2,107,024
- ---------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE DEBENTURES 2,107,024
- ---------------------------------------------------------------------------------------------
(cost $1,803,801)
PURCHASED OPTIONS 0.51% CONTRACTS
INTERMEDIATE & JUNIOR GOLD PRODUCERS 0.01%
- ---------------------------------------------------------------------------------------------
Goldcorp, Inc., Strike Price 20, Put, Expiration Apr.
2006 (premium $52,500) 400 32,000
SENIOR GOLD PRODUCERS 0.50%
- ---------------------------------------------------------------------------------------------
Freeport McMoRan Copper & Gold, Inc., Strike Price 40,
Call, Expiration Jan. 2006 (premium $84,104) 200 290,000
Freeport McMoRan Copper & Gold, Inc., Strike Price 45,
Put, Expiration Feb. 2006 (premium $89,975) 750 37,500
Freeport McMoRan Copper & Gold, Inc., Strike Price 50,
Put, Expiration Jan. 2006 (premium $71,050) 350 19,250
Gold Fields Ltd., Strike Price 15, Put, Expiration
Apr. 2006 (premium $102,000) 750 37,500
Newmont Mining Corp., Strike Price 45, Put, Expiration
Jun. 2006 (premium $142,275) 500 50,000
Philadelphia Stock Exchange Gold & Silver Index,
Strike Price 115, Put, Expiration Jan. 2006 (premium
$162,138) 700 21,000
Philadelphia Stock Exchange Gold & Silver Index,
Strike Price 90, Put, Expiration Mar. 2006 (premium
$485,315) 4,000 100,000
Placer Dome, Inc., Strike Price 15, Call, Expiration
Jun. 2006 (premium $842,742) 1,400 1,113,000
Placer Dome, Inc., Strike Price 17.50, Call,
Expiration Jan. 2007 (premium $29,600) 200 116,000
Placer Dome, Inc., Strike Price 25, Call, Expiration
Jan. 2006 (premium $422,911) 3,610 18,050
------------
1,802,300
- ---------------------------------------------------------------------------------------------
TOTAL PURCHASED OPTIONS 1,834,300
- ---------------------------------------------------------------------------------------------
(cost $2,484,610)
- ---------------------------------------------------------------------------------------------
TOTAL SECURITIES 342,317,336
- ---------------------------------------------------------------------------------------------
See notes to portfolios of investments and notes to financial statements.
80
WORLD PRECIOUS MINERALS FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
PRINCIPAL
REPURCHASE AGREEMENT 4.98% AMOUNT VALUE
Joint Tri-Party Repurchase Agreement, Morgan Stanley
Dean Witter, 12/30/05, 3.45%, due 01/03/06,
repurchase price $17,946,370, collateralized by U.S.
Treasury securities held in a joint tri-party
repurchase account (cost $17,939,493) $ 17,939,493 $ 17,939,493
- ---------------------------------------------------------------------------------------------
TOTAL INVESTMENTS 100.07% 360,256,829
- ---------------------------------------------------------------------------------------------
(cost $249,271,863)
Other assets and liabilities, net (0.07)% (237,753)
------------
NET ASSETS 100% $360,019,076
------------
See notes to portfolios of investments and notes to financial statements.
81
GOLD SHARES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS 91.67% SHARES VALUE
DIAMOND MINING & EXPLORATION 0.90%
- ----------------------------------------------------------------------------------------
Aber Diamond Corp. 22,000 $ 810,998
Diamond Fields International Ltd. 284,000 41,419*
Diamond Fields International Ltd., Warrants (November
2006) 176,000 0*
-----------
852,417
FINANCIAL SERVICES 1.33%
- ----------------------------------------------------------------------------------------
Dundee Wealth Management, Inc. 75,000 649,209
GMP Capital Trust 40,000 614,936
-----------
1,264,145
GOLD MINING 76.20%
- ----------------------------------------------------------------------------------------
Agnico-Eagle Mines Ltd. 96,400 1,903,769
Agnico-Eagle Mines Ltd., Warrants (November 2007) 221,100 975,051*
Apollo Gold Corp. 101,500 22,640*
Apollo Gold Corp., Warrants (December 2006) 166,500 0*
Barrick Gold Corp. 20,000 557,400
Bema Gold Corp. 50,000 144,555*
Bema Gold Corp., Warrants (October 2007) 1,812,940 2,752,888*
Bolivar Gold Corp. 135,000 339,339*
Bolivar Gold Corp., Warrants (March 2008) 200,000 331,146*
Bolivar Gold Corp., Warrants (August 2008) 10,000 10,981*
Cambior, Inc. 424,400 1,184,716*
Cambior, Inc., Warrants (October 2006) 43,300 7,429*
Cambior, Inc., Warrants (August 2008) 269,115 196,240*
Century Mining Corp. 69,706 23,322*
DRDGOLD Ltd., Sponsored ADR 100,000 144,000
Freeport-McMoRan Copper & Gold, Inc., Class B 100,000 5,380,000
Glamis Gold Ltd. 45,000 1,235,003*
Glencairn Gold Corp. 177,000 65,294*
Glencairn Gold Corp., Warrants (November 2008) 88,500 7,592*
Gold Fields Ltd. 50,000 881,009
Gold Fields Ltd., ADR 226,000 3,984,380
Goldcorp, Inc., Warrants (March 2007), Class C 2,325,000 9,673,787*
Goldcorp, Inc., Warrants (April 2007) 72,900 1,603,800*
Goldcorp, Inc., Warrants (May 2007), Class A 950,000 3,952,730*
Goldcorp, Inc., Warrants (August 2008), Class B 772,490 2,352,627*
Goldcorp, Inc., Warrants (May 2009) 88,000 2,636,263*
Golden Star Resources Ltd., Warrants (February 2007) 5,000 2,874*
Harmony Gold Mining Co., Ltd., Sponsored ADR 140,000 1,827,000*
Hecla Mining Co. 90,000 365,400*
IAMGOLD Corp. 150,000 1,178,741
Ivanhoe Mines Ltd. 188,000 1,346,716*
Kinross Gold Corp. 110,000 1,013,512*
Kinross Gold Corp., Warrants (December 2007) 1,244,000 458,903*
Lihir Gold Ltd. 550,000 879,766*
See notes to portfolios of investments and notes to financial statements.
82
GOLD SHARES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
COMMON STOCKS AND WARRANTS SHARES VALUE
GOLD MINING (CONT'D)
- -------------------------------------------------------------------------------------------
Meridian Gold, Inc. 222,000 $ 4,854,779*
Nevada Pacific Gold Ltd. 68,500 52,889*
Newmont Mining Corp. 55,000 2,937,000
Northern Orion Resources, Inc. 1,902,500 6,185,752*
Northern Orion Resources, Inc., Warrants (May 2008) 860,350 1,513,076*
Northern Orion Resources, Inc., Warrants (February 2010) 15,000 9,008*
Northgate Minerals Corp. 1,638,000 2,993,128*
Northgate Minerals Corp., Warrants (December 2006) 1,252,900 268,712*
Placer Dome, Inc. 10,000 229,297
Randgold Resources Ltd., ADR 244,630 3,945,882*
Rio Narcea Gold Mines Ltd., Warrants (September 2008) 251,750 33,476*
Yamana Gold, Inc. 280,752 1,854,579*
-----------
72,316,451
GOLD ROYALTY COMPANY 2.97%
- ----------------------------------------------------------------------------------------
Royal Gold, Inc. 81,000 2,813,130
INVESTMENT TRUST 0.95%
- ----------------------------------------------------------------------------------------
streetTRACKS Gold Trust 17,500 902,650*
METAL & MINERAL MINING 9.01%
- ----------------------------------------------------------------------------------------
Coeur d'Alene Mines Corp. 100,000 400,000*
JSC MMC Norilsk Nickel, ADR 10,000 950,000
Lundin Mining Corp. 110,430 1,596,316*
Pan American Silver Corp., Warrants (February 2008) 122,650 1,192,146*
Silver Wheaton Corp. 382,250 2,213,518*
Silver Wheaton Corp., Units 200,000 1,303,993
Silver Wheaton Corp., Warrants (August 2009) 1,368,000 774,572*
Silver Wheaton Corp., Warrants (November 2009) 250,000 117,960*
-----------
8,548,505
OIL & GAS ROYALTY TRUSTS 0.31%
- ----------------------------------------------------------------------------------------
Harvest Energy Trust 5,000 159,525
ARC Energy Trust 2,500 56,814
Bonavista Energy Trust 2,500 81,714
-----------
298,053
- ----------------------------------------------------------------------------------------
TOTAL COMMON STOCKS AND WARRANTS 86,995,351
- ----------------------------------------------------------------------------------------
(cost $53,083,898)
See notes to portfolios of investments and notes to financial statements.
83
GOLD SHARES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
PREFERRED STOCK 0.67% SHARES VALUE
GOLD MINING 0.67%
- ----------------------------------------------------------------------------------------
Freeport-McMoRan Copper & Gold, Inc., Depositary Shares
representing 0.05 shares of Gold - Denominated
Preferred Stock (cost $449,619) 12,500 $ 640,000
PRINCIPAL
CONVERTIBLE DEBENTURE 0.27% AMOUNT
GOLD MINING 0.27%
- -----------------------------------------------------------------------------------------
Century Mining Corp., 10.00%, maturity 12/31/06
(cost $219,772) CAD $ 300,000 257,367
PURCHASED OPTIONS 1.15% CONTRACTS
GOLD MINING 1.15%
- ----------------------------------------------------------------------------------------
Freeport McMoRan Copper & Gold, Inc., Strike Price 40,
Call, Expiration Jan. 2006 (premium $42,052) 100 145,000
Freeport McMoRan Copper & Gold, Inc., Strike Price 45,
Put, Expiration Feb. 2006 (premium $54,940) 500 25,000
Freeport McMoRan Copper & Gold, Inc., Strike Price 50,
Put, Expiration Jan. 2006 (premium $57,600) 300 16,500
Glamis Gold Ltd., Strike Price 20, Put, Expiration Feb.
2006 (premium $40,400) 400 6,000
Gold Fields Ltd., Strike Price 15, Put, Expiration Apr.
2006 (premium $217,360) 1,750 87,500
Goldcorp, Inc., Strike Price 20, Put, Expiration Apr.
2006 (premium $24,938) 190 15,200
Harmony Gold Mining Co., Ltd., Strike Price 12.50, Put,
Expiration Feb. 2006 (premium $90,590) 1,000 67,500
Harmony Gold Mining Co., Ltd., Strike Price 17.50, Call,
Expiration Jan. 2008 (premium $127,770) 500 130,000
Meridian Gold, Inc., Strike Price 17.50, Put, Expiration
Apr. 2006 (premium $51,000) 500 18,750
Meridian Gold, Inc., Strike Price 20, Put, Expiration
Apr. 2006 (premium $106,000) 500 50,000
Newmont Mining Corp., Strike Price 45, Put, Expiration
Jun. 2006 (premium $142,275) 500 50,000
Philadelphia Stock Exchange Gold & Silver Index, Strike
Price 115, Put, Expiration Jan. 2006 (premium $69,487) 300 9,000
Philadelphia Stock Exchange Gold & Silver Index, Strike
Price 90, Put, Expiration Mar. 2006 (premium $160,093) 1,500 37,500
Placer Dome, Inc., Strike Price 15, Call, Expiration
Jun. 2006 (premium $326,388) 500 397,500
See notes to portfolios of investments and notes to financial statements.
84
GOLD SHARES FUND
PORTFOLIO OF INVESTMENTS (UNAUDITED) December 31, 2005
PURCHASED OPTIONS CONTRACTS VALUE
GOLD MINING (CONT'D)
- -----------------------------------------------------------------------------------------
Placer Dome, Inc., Strike Price 17.50, Call, Expiration
Jan. 2007 (premium $7,400) 50 $ 29,000
Placer Dome, Inc., Strike Price 25, Call, Expiration
Jan. 2006 (premium $58,563) 500 2,500
-----------
1,086,950
- ----------------------------------------------------------------------------------------
TOTAL PURCHASED OPTIONS 1,086,950
- ----------------------------------------------------------------------------------------
(cost $1,576,856)
- ----------------------------------------------------------------------------------------
TOTAL SECURITIES 88,979,668
- ----------------------------------------------------------------------------------------
PRINCIPAL
REPURCHASE AGREEMENT 7.18% AMOUNT
Joint Tri-Party Repurchase Agreement, Morgan Stanley
Dean Witter, 12/30/05, 3.45%, due 01/03/06,
repurchase price $6,816,655, collateralized by
U.S. Treasury securities held in a joint tri-party
repurchase account (cost $6,814,043) $6,814,043 6,814,043
- ----------------------------------------------------------------------------------------
TOTAL INVESTMENTS 100.94% 95,793,711
- ----------------------------------------------------------------------------------------
(cost $62,144,188)
Other assets and liabilities, net (0.94)% (892,269)
-----------
NET ASSETS 100% $94,901,442
-----------
See notes to portfolios of investments and notes to financial statements.
85
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2005
LEGEND
* Non-income producing security GO General Obligation Bond
+ Affiliated company (see following) RS Restricted Security (see following)
ADR American 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, 2005.
Securities with a 144A designation are exempt from registration
under Rule 144A of the Securities Act of 1933.
JOINT TRI-PARTY REPURCHASE AGREEMENTS
The terms of the joint tri-party repurchase agreements and the
securities held as collateral at December 31, 2005 were:
Morgan Stanley Dean Witter repurchase agreement, 12/30/05, 3.45%, due 01/03/06:
Total principal amount: $132,487,417; Total repurchase price: $132,538,204
Collateral:
$96,652,000 U.S. Treasury Bond, 8.125%, 05/15/21
(total collateral market value, including accrued interest,
of $135,137,873)
UBS Financial Services, Inc. repurchase agreement, 12/30/05, 3.40%,
due 01/03/06:
Total principal amount: $22,000,000; Total repurchase price: $22,008,311
Collateral:
$13,720,000 U.S. Treasury Bonds, interest rate range 5.25% - 13.875%,
maturity date range 02/15/06 - 05/15/30
$3,932,000 U.S. Treasury Notes, interest rate range 1.50% - 6.875%,
maturity date range 02/15/06 - 08/15/15
(total collateral market value, including accrued interest,
of $22,440,632)
Other mutual funds managed by U.S. Global Investors, Inc. participate in the
joint tri-party repurchase agreements. Each owns an undivided interest in
the accounts.
86
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2005
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 period ended December 31, 2005.
SHARES OF AFFILIATED COMPANIES
JUNE 30, 2005 ADDITIONS REDUCTIONS DECEMBER 31, 2005
GLOBAL RESOURCES FUND
- ---------------------------------------------------------------------------------------------------
Coalcorp Mining, Inc. (formerly Adobe
Ventures, Inc.) 2,140,000 900,000 -- 3,040,000
Pacific Stratus Energy Ltd. 3,000,000 4,183,000 -- 7,183,000
PetroWorld Corp. -- 2,000,000 -- 2,000,000
UMC Energy plc (formerly Uranium
Mining Corp plc) -- 1,000,000 -- 1,000,000
White Nile Ltd. 12,772,000 390,000 (160,000) 13,002,000
At December 31, 2005, the value of investments in affiliated
companies was $26,458,222, representing 3.36% of net assets, and the
total cost was $7,844,331. Net realized gains on transactions were
$329,000, and there was no income earned for the period.
SHARES OF AFFILIATED COMPANIES
JUNE 30, 2005 ADDITIONS REDUCTIONS DECEMBER 31, 2005
WORLD PRECIOUS MINERALS FUND
- -------------------------------------------------------------------------------------------------
Caledon Resources plc 18,175,000 790,000 (75,000) 18,890,000
Corona Gold Ltd. 812,500 -- -- 812,500(a)
Diamonds North Resources Ltd. 2,207,000 170,000 (150,000) 2,227,000
Endeavour Mining Capital Corp. 1,484,100 -- (1,484,100) --(a)
Golden Odyssey Mining, Inc. -- 1,255,000 -- 1,255,000
Laurion Gold, Inc. 3,438,000 3,067,000 (6,505,000) --(a)
Moss Lake Gold Mines Ltd. 2,318,000 106,500 (34,000) 2,390,500
Nevada Pacific Gold Ltd. 3,892,335 64,500 (970,000) 2,986,835
Northern Orion Resources, Inc. 7,336,900 285,100 (200,000) 7,422,000(a)
Pacific Rim Mining Corp. 5,049,500 90,600 (110,000) 5,030,100
Romarco Minerals, Inc. 2,251,000 5,702,353 -- 7,953,353
Vedron Gold, Inc. 2,578,500 3,053,879 (690,000) 4,942,379
At December 31, 2005, the value of investments in affiliated
companies was $12,386,387 representing 3.44% of net assets, and the
total cost was $11,170,613. Net realized gains on transactions were
$1,921,291, and there was $43,480 of income earned for the period.
(a) At December 31, 2005, the company is no longer defined as an
affiliate, although it was an affiliated company during the
period.
87
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2005
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.
ACQUISITION COST PER
DATE SHARE
CHINA REGION OPPORTUNITY FUND
- ------------------------------------------------------------------------------------------
COMMON STOCKS
Big Sky Energy Corp. 03/01/05 $0.50
At December 31, 2005, the total cost of restricted securities was
$50,000, and the total value was $164,350, representing 0.44% of net
assets.
ACQUISITION COST PER
DATE SHARE
GLOBAL RESOURCES FUND
- ------------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
African Minerals, Special Warrants 07/09/03 $6.00
Big Sky Energy Corp. 03/01/05 $0.50
Coalcorp Mining, Inc. (formerly Adobe Ventures,
Inc.), Warrants (September 2007) 09/29/05 $0.24
Gastar Exploration Ltd. 06/16/05 $2.67
Hyduke Energy Services, Inc., Units 12/13/05 $2.00
Khan Resources, Inc., Special Warrants 03/24/05 $0.82
Osmium Holdings S.A. 10/22/96-01/29/98 $987.07
Saxon Energy Services, Inc. 11/11/05 $4.11
Saxon Energy Services, Inc., Warrants (November
2006) 11/11/05 $0.00
Silvercorp Metals, Inc. 09/08/05 $2.71
Silvercorp Metals, Inc., Warrants (September 2006) 09/08/05 $0.00
Zenas Energy Corp. 10/12/05 $4.78
Zimasco Consolidated Enterprises Ltd. 06/15/95-09/30/99 $3.73
CONVERTIBLE DEBENTURE
1078352 Alberta Ltd. 12/07/04 $0.83
At December 31, 2005, the total cost of restricted securities was
$7,730,969, and the total value was $10,218,151, representing 1.30%
of net assets.
88
NOTES TO PORTFOLIOS OF INVESTMENTS (UNAUDITED) December 31, 2005
ACQUISITION COST PER
DATE SHARE
WORLD PRECIOUS MINERALS FUND
- ------------------------------------------------------------------------------------------
COMMON STOCKS AND WARRANTS
Aberdeen International, Inc., Units 12/23/05 $0.69
African Minerals, Special Warrants 07/09/03 $6.00
Big Sky Energy Corp. 03/01/05 $0.50
Chilean Gold Ltd. 01/17/97 $1.10
Grandview Gold, Inc. 08/30/05 $1.05
Grandview Gold, Inc., Warrants (August 2006) 08/30/05 $0.00
Osmium Holdings S.A. 10/22/96-01/29/98 $1,280.75
Platte River Gold, Special Warrants 03/01/04-06/07/04 $1.50
Romarco Minerals, Inc. 09/06/05 $0.14
Romarco Minerals, Inc., Warrants (September 2007) 09/06/05 $0.00
Western Exploration & Development Ltd., 144A,
Special Warrants 08/14/97 $0.50
Zimasco Consolidated Enterprises Ltd. 06/15/95-09/30/99 $3.73
At December 31, 2005, the total cost of restricted securities was
$6,443,134, and the total value was $4,619,350, representing 1.28%
of net assets.
89
STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)
U.S. TREASURY
SECURITIES
CASH FUND
Investments, at identified cost $107,521,295
============
ASSETS
- ---------------------------------------------------------------------------
Investments, at value:
Securities $ 59,708,201
Repurchase Agreements 47,813,094
Cash --
Receivables:
Investments sold --
Interest 147,618
Capital shares sold 2,650,589
From adviser --
Other assets 36,761
- ---------------------------------------------------------------------------
TOTAL ASSETS 110,356,263
- ---------------------------------------------------------------------------
LIABILITIES
- ---------------------------------------------------------------------------
Payables:
Capital shares redeemed 1,373,348
Adviser and affiliates 107,879
Dividends and distributions 5,087
Accounts payable and accrued expenses 65,026
- ---------------------------------------------------------------------------
TOTAL LIABILITIES 1,551,340
- ---------------------------------------------------------------------------
NET ASSETS $108,804,923
============
NET ASSETS CONSIST OF:
- ---------------------------------------------------------------------------
Paid-in capital $108,823,409
Accumulated undistributed net investment income
(distributions in excess of net investment income) (15)
Accumulated net realized loss on investments and foreign
currencies (18,471)
Net unrealized appreciation (depreciation) of investments
and other assets and liabilities denominated in
foreign currencies --
------------
Net assets applicable to capital shares outstanding $108,804,923
============
Capital shares outstanding, an unlimited number of no
par shares authorized 108,878,206
============
NET ASSET VALUE, PUBLIC OFFERING PRICE, REDEMPTION PRICE,
PER SHARE $ 1.00
============
See accompanying notes to financial statements.
90
December 31, 2005
U.S. GOVERNMENT
SECURITIES NEAR-TERM TAX FREE
SAVINGS FUND TAX FREE FUND FUND
Investments, at identified cost $403,736,513 $15,812,531 $14,060,413
============ =========== ===========
ASSETS
- ------------------------------------------------------------------------------------------------------------------
Investments, at value:
Securities $403,736,513 $15,044,103 $14,303,538
Repurchase Agreements -- 714,933 387,261
Cash 291,260 -- --
Receivables:
Investments sold -- 370,943 --
Interest 989,609 203,330 183,657
Capital shares sold 1,895,493 1,396 704
From adviser -- 6,621 4,225
Other assets 31,066 2,925 4,589
- ------------------------------------------------------------------------------------------------------------------
TOTAL ASSETS 406,943,941 16,344,251 14,883,974
- ------------------------------------------------------------------------------------------------------------------
LIABILITIES
- ------------------------------------------------------------------------------------------------------------------
Payables:
Capital shares redeemed 1,867,932 298,659 --
Adviser and affiliates 119,749 -- --
Dividends and distributions 18,250 7,474 5,131
Accounts payable and accrued expenses 96,384 44,761 42,206
- ------------------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 2,102,315 350,894 47,337
- ------------------------------------------------------------------------------------------------------------------
NET ASSETS $404,841,626 $15,993,357 $14,836,637
============ =========== ===========
NET ASSETS CONSIST OF:
- ------------------------------------------------------------------------------------------------------------------
Paid-in capital $404,457,814 $16,234,592 $14,955,375
Accumulated undistributed net investment income
(distributions in excess of net investment income) 395,891 16,241 27,316
Accumulated net realized loss on investments and foreign
currencies (12,079) (203,981) (776,441)
Net unrealized appreciation (depreciation) of investments
and other assets and liabilities denominated in
foreign currencies -- (53,495) 630,387
------------ ----------- -----------
Net assets applicable to capital shares outstanding $404,841,626 $15,993,357 $14,836,637
============ =========== ===========
Capital shares outstanding, an unlimited number of no
par shares authorized 405,086,815 7,454,687 1,217,685
============ =========== ===========
NET ASSET VALUE, PUBLIC OFFERING PRICE, REDEMPTION PRICE,
PER SHARE $ 1.00 $ 2.15 $ 12.18
============ =========== ===========
91
STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)
ALL AMERICAN CHINA REGION
EQUITY FUND OPPORTUNITY FUND
Investments, at identified cost $17,167,130 $29,695,239
=========== ===========
ASSETS
- ----------------------------------------------------------------------------------
Investments, at value:
Securities of unaffiliated issuers $18,340,358 $34,700,152
Securities of affiliated issuers -- --
Repurchase Agreements 1,132,194 2,132,668
Cash 867 8,873
Foreign currencies (cost $95,526, $0,
$673,326, $0, and $0) 95,526 --
Receivables:
Investments sold 1,044,368 391,494
Dividends 11,704 2,374
Interest 217 409
Capital shares sold 1,601 235,702
Unrealized appreciation on foreign
currency exchange contracts - 1 G -- --
Other assets 11,515 17,379
- ----------------------------------------------------------------------------------
TOTAL ASSETS 20,638,350 37,489,051
- ----------------------------------------------------------------------------------
LIABILITIES
- ----------------------------------------------------------------------------------
Payables:
Investments purchased 95,526 4,150
Capital shares redeemed 22,856 42,922
Adviser and affiliates 17,184 45,866
Dividends and distributions -- 723
Accounts payable and accrued expenses 40,707 72,438
Due to custodian -- --
Unrealized depreciation on foreign
currency exchange contracts - 1 G 115 21
- ----------------------------------------------------------------------------------
TOTAL LIABILITIES 176,388 166,120
- ----------------------------------------------------------------------------------
NET ASSETS $20,461,962 $37,322,931
=========== ===========
NET ASSETS CONSIST OF:
- ----------------------------------------------------------------------------------
Paid-in capital $17,353,636 $38,615,277
Distributions in excess of net investment
income (69,746) (1,868,544)
Accumulated net realized gain (loss) on
investments and foreign currencies 872,726 (6,560,832)
Net unrealized appreciation of investments
and other assets and liabilities
denominated in foreign currencies 2,305,346 7,137,030
----------- -----------
Net assets applicable to capital shares
outstanding $20,461,962 $37,322,931
=========== ===========
Capital shares outstanding, an
unlimited number of no par shares
authorized 781,733 4,830,912
=========== ===========
NET ASSET VALUE, PUBLIC OFFERING PRICE,
REDEMPTION PRICE, PER SHARE $ 26.18 $ 7.73
=========== ===========
See accompanying notes to financial statements.
92
December 31, 2005
GLOBAL RESOURCES WORLD PRECIOUS GOLD SHARES
FUND MINERALS FUND FUND
Investments, at identified cost $629,748,521 $249,271,863 $ 62,144,188
============ ============ =============
ASSETS
- ----------------------------------------------------------------------------------------------------------
Investments, at value:
Securities of unaffiliated issuers $725,805,596 $329,930,949 $ 88,979,668
Securities of affiliated issuers 26,458,222 12,386,387 --
Repurchase Agreements 31,731,670 17,939,493 6,814,043
Cash 13,892 -- --
Foreign currencies (cost $95,526, $0,
$673,326, $0, and $0) 677,349 -- --
Receivables:
Investments sold 11,596,222 5,330,265 564,593
Dividends 1,293,554 73,905 18,437
Interest 65,833 59,679 7,864
Capital shares sold 4,328,883 998,632 485,534
Unrealized appreciation on foreign
currency exchange contracts - 1 G 4,816 227 --
Other assets 63,333 49,587 43,101
- ----------------------------------------------------------------------------------------------------------
TOTAL ASSETS 802,039,370 366,769,124 96,913,240
- ----------------------------------------------------------------------------------------------------------
LIABILITIES
- ----------------------------------------------------------------------------------------------------------
Payables:
Investments purchased 11,901,327 3,898,684 1,347,600
Capital shares redeemed 930,049 1,387,618 348,662
Adviser and affiliates 515,855 288,898 69,689
Dividends and distributions 11,997 278 --
Accounts payable and accrued expenses 106,058 195,660 92,813
Due to custodian -- 972,787 151,761
Unrealized depreciation on foreign
currency exchange contracts - 1 G 7,210 6,123 1,273
- ----------------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 13,472,496 6,750,048 2,011,798
- ----------------------------------------------------------------------------------------------------------
NET ASSETS $788,566,874 $360,019,076 $ 94,901,442
============ ============ =============
NET ASSETS CONSIST OF:
- ----------------------------------------------------------------------------------------------------------
Paid-in capital $631,203,545 $261,746,616 $ 164,306,193
Distributions in excess of net investment
income (16,390,763) (27,413,717) (992,247)
Accumulated net realized gain (loss) on
investments and foreign currencies 19,520,736 14,717,263 (102,060,668)
Net unrealized appreciation of investments
and other assets and liabilities
denominated in foreign currencies 154,233,356 110,968,914 33,648,164
------------ ------------ -------------
Net assets applicable to capital shares
outstanding $788,566,874 $360,019,076 $ 94,901,442
============ ============ =============
Capital shares outstanding, an
unlimited number of no par shares
authorized 55,186,347 17,717,561 8,868,655
============ ============ =============
NET ASSET VALUE, PUBLIC OFFERING PRICE,
REDEMPTION PRICE, PER SHARE $ 14.29 $ 20.32 $ 10.70
============ ============ =============
See accompanying notes to financial statements.
93
STATEMENTS OF OPERATIONS (UNAUDITED)
U.S. TREASURY
SECURITIES
CASH FUND
NET INVESTMENT INCOME
INCOME:
- ---------------------------------------------------------------------------
Interest and other $2,071,168
EXPENSES:
- ---------------------------------------------------------------------------
Management fee 293,780
Transfer agent fees and expenses 94,896
Accounting service fees and expenses 16,518
Professional fees 29,050
Custodian fees 43,317
Shareholder reporting 37,104
Registration fees 13,768
Trustee fees and expenses 11,511
Miscellaneous 16,639
----------
Total expenses before reductions 556,583
Expenses offset - Note 1 J (1,111)
Expenses reimbursed - Note 2 --
Net recouped fees - Note 2 45,136
----------
NET EXPENSES 600,608
- ---------------------------------------------------------------------------
NET INVESTMENT INCOME 1,470,560
- ---------------------------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS
Realized gain (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 $1,470,560
==========
See accompanying notes to financial statements.
94
For the Six Months Ended December 31, 2005
U.S. GOVERNMENT
SECURITIES NEAR-TERM TAX FREE
SAVINGS FUND TAX FREE FUND FUND
NET INVESTMENT INCOME
INCOME:
- --------------------------------------------------------------------------------------------------------------
Interest and other $7,372,602 $ 297,408 $ 500,427
EXPENSES:
- --------------------------------------------------------------------------------------------------------------
Management fee 924,007 43,597 83,610
Transfer agent fees and expenses 190,569 7,250 8,160
Accounting service fees and expenses 35,673 24,483 23,771
Professional fees 36,162 26,660 26,728
Custodian fees 39,115 6,676 7,198
Shareholder reporting 58,811 2,568 2,976
Registration fees 17,738 8,345 7,034
Trustee fees and expenses 11,511 11,511 11,511
Miscellaneous 26,402 4,051 5,365
---------- --------- ---------
Total expenses before reductions 1,339,988 135,141 176,353
Expenses offset - Note 1 J (52) (84) (159)
Expenses reimbursed - Note 2 (420,367) (95,828) (98,176)
Net recouped fees - Note 2 -- -- --
---------- --------- ---------
NET EXPENSES 919,569 39,229 78,018
- --------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 6,453,033 258,179 422,409
- --------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS
Realized gain (loss) from securities -- (46,736) 73,639
Net change in unrealized depreciation of:
Investments -- (137,698) (385,479)
- --------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS -- (184,434) (311,840)
- --------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $6,453,033 $ 73,745 $ 110,569
========== ========= =========
See accompanying notes to financial statements.
95
STATEMENTS OF OPERATIONS (UNAUDITED)
ALL AMERICAN CHINA REGION
EQUITY FUND OPPORTUNITY FUND
NET INVESTMENT INCOME
INCOME:
- ----------------------------------------------------------------------------------
Dividends from unaffiliated issuers $ 74,402 $ 216,877
Dividends from affiliated issuers -- --
Foreign taxes withheld on dividends (1,460) (7,714)
---------- ----------
Net dividends 72,942 209,163
Interest and other 33,340 53,642
---------- ----------
TOTAL INCOME 106,282 262,805
EXPENSES:
- ----------------------------------------------------------------------------------
Management fee 75,444 207,730
Transfer agent fees and expenses 43,993 49,811
Accounting service fees and expenses 16,882 25,952
Professional fees 34,412 40,104
Custodian fees 12,036 35,791
Shareholder reporting 14,051 13,392
Registration fees 7,146 8,063
Trustee fees and expenses 11,511 11,511
Miscellaneous 9,010 10,824
---------- ----------
Total expenses before reductions 224,485 403,178
Expenses offset - Note 1 J (462) (195)
Expenses reimbursed - Note 2 (47,995) --
---------- ----------
NET EXPENSES 176,028 402,983
- ----------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS) (69,746) (140,178)
- ----------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Realized gain (loss) from:
Securities of unaffiliated issuers 1,482,869 3,174,437
Securities of affiliated issuers -- --
Foreign currency transactions (145) (34,442)
Written Options -- --
---------- ----------
NET REALIZED GAIN 1,482,724 3,139,995
---------- ----------
Net change in unrealized appreciation
(depreciation) of:
Investments 359,874 1,799,691
Other assets and liabilities
denominated in foreign currencies (77) 7,663
---------- ----------
NET UNREALIZED APPRECIATION 359,797 1,807,354
- ----------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS 1,842,521 4,947,349
- ----------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $1,772,775 $4,807,171
========== ==========
See accompanying notes to financial statements.
96
For the Six Months Ended December 31, 2005
GLOBAL RESOURCES WORLD PRECIOUS GOLD SHARES
FUND MINERALS FUND FUND
NET INVESTMENT INCOME
INCOME:
- -----------------------------------------------------------------------------------------------------------
Dividends from unaffiliated issuers $ 6,469,229 $ 620,030 $ 278,309
Dividends from affiliated issuers -- 43,480 --
Foreign taxes withheld on dividends (767,308) (46,168) (8,142)
------------ ------------ -----------
Net dividends 5,701,921 617,342 270,167
Interest and other 1,432,735 520,678 203,817
------------ ------------ -----------
TOTAL INCOME 7,134,656 1,138,020 473,984
EXPENSES:
- -----------------------------------------------------------------------------------------------------------
Management fee 2,303,679 1,394,074 305,843
Transfer agent fees and expenses 471,633 266,158 158,633
Accounting service fees and expenses 167,360 95,101 34,464
Professional fees 60,277 76,922 59,162
Custodian fees 158,522 124,699 35,507
Shareholder reporting 50,308 52,905 56,906
Registration fees 29,122 15,981 10,804
Trustee fees and expenses 11,511 11,511 11,511
Miscellaneous 24,776 40,739 27,312
------------ ------------ -----------
Total expenses before reductions 3,277,188 2,078,090 700,142
Expenses offset - Note 1 J (20,236) (3,683) (599)
Expenses reimbursed - Note 2 -- -- --
------------ ------------ -----------
NET EXPENSES 3,256,952 2,074,407 699,543
- -----------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS) 3,877,704 (936,387) (225,559)
- -----------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS
Realized gain (loss) from:
Securities of unaffiliated issuers 40,758,807 24,069,361 5,647,940
Securities of affiliated issuers 329,000 1,921,291 --
Foreign currency transactions (315,913) (168,455) (50,463)
Written Options -- -- 59,616
------------ ------------ -----------
NET REALIZED GAIN 40,771,894 25,822,197 5,657,093
------------ ------------ -----------
Net change in unrealized appreciation
(depreciation) of:
Investments 83,014,146 75,327,318 22,431,623
Other assets and liabilities
denominated in foreign currencies (19,957) (31,702) (1,523)
------------ ------------ -----------
NET UNREALIZED APPRECIATION 82,994,189 75,295,616 22,430,100
- -----------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS 123,766,083 101,117,813 28,087,193
- -----------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $127,643,787 $100,181,426 $27,861,634
============ ============ ===========
See accompanying notes to financial statements.
97
STATEMENTS OF CHANGES IN NET ASSETS
U.S. TREASURY SECURITIES
CASH FUND
-------------------------------------
SIX MONTHS ENDED
DECEMBER 31, 2005 YEAR ENDED
(UNAUDITED) JUNE 30, 2005
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- -----------------------------------------------------------------------------------------
Net investment income $ 1,470,560 $ 1,286,744
Net realized gain (loss) -- --
Net unrealized depreciation -- --
------------ ------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS 1,470,560 1,286,744
DISTRIBUTIONS TO SHAREHOLDERS:
- -----------------------------------------------------------------------------------------
From net investment income (1,472,075) (1,284,803)
------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (1,472,075) (1,284,803)
FROM CAPITAL SHARE TRANSACTIONS:
- -----------------------------------------------------------------------------------------
Proceeds from shares sold 392,869,206 885,364,783
Distributions reinvested 1,423,376 1,241,293
------------ ------------
394,292,582 886,606,076
Cost of shares redeemed (409,544,244) (875,124,840)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS (15,251,662) 11,481,236
- -----------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (15,253,177) 11,483,177
- -----------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 124,058,100 112,574,923
- -----------------------------------------------------------------------------------------
END OF PERIOD $108,804,923 $124,058,100
- -----------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(distributions in excess of net investment
income), end of period $ (15) $ 1,500
============ ============
CAPITAL SHARE ACTIVITY
- -----------------------------------------------------------------------------------------
Shares sold 392,869,206 885,364,783
Shares reinvested 1,423,376 1,241,293
Shares redeemed (409,544,244) (875,124,840)
------------ ------------
NET SHARE ACTIVITY (15,251,662) 11,481,236
============ ============
See accompanying notes to financial statements.
98
U.S. GOVERNMENT SECURITIES
SAVINGS FUND NEAR-TERM TAX FREE FUND
------------------------------------- ------------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, 2005 YEAR ENDED DECEMBER 31, 2005 YEAR ENDED
(UNAUDITED) JUNE 30, 2005 (UNAUDITED) JUNE 30, 2005
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- ---------------------------------------------------------------------------------------------------------------------------------
Net investment income $ 6,453,033 $ 7,220,102 $ 258,179 $ 525,000
Net realized gain (loss) -- 10,041 (46,736) (5,056)
Net unrealized depreciation -- -- (137,698) (26,783)
------------- ------------- ----------- -----------
NET INCREASE IN NET ASSETS FROM
OPERATIONS 6,453,033 7,230,143 73,745 493,161
DISTRIBUTIONS TO SHAREHOLDERS:
- ---------------------------------------------------------------------------------------------------------------------------------
From net investment income (6,446,910) (7,229,289) (253,872) (525,088)
------------- ------------- ----------- -----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (6,446,910) (7,229,289) (253,872) (525,088)
FROM CAPITAL SHARE TRANSACTIONS:
- ---------------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 142,332,405 282,004,726 1,578,396 5,862,192
Distributions reinvested 6,342,983 7,102,469 215,587 462,629
------------- ------------- ----------- -----------
148,675,388 289,107,195 1,793,983 6,324,821
Cost of shares redeemed (155,818,603) (318,850,857) (4,326,287) (6,260,222)
------------- ------------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS (7,143,215) (29,743,662) (2,532,304) 64,599
- ---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (7,137,092) (29,742,808) (2,712,431) 32,672
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 411,978,718 441,721,526 18,705,788 18,673,116
- ---------------------------------------------------------------------------------------------------------------------------------
END OF PERIOD $ 404,841,626 $ 411,978,718 $15,993,357 $18,705,788
- ---------------------------------------------------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(distributions in excess of net investment
income), end of period $ 395,891 $ 389,768 $ 16,241 $ 11,934
============= ============= =========== ===========
CAPITAL SHARE ACTIVITY
- --------------------------------------------------------------------------------------------------------------------------------
Shares sold 142,332,405 282,004,726 732,118 2,682,173
Shares reinvested 6,342,983 7,102,469 100,032 211,912
Shares redeemed (155,818,603) (318,850,857) (2,005,038) (2,865,075)
------------- ------------- ----------- -----------
NET SHARE ACTIVITY (7,143,215) (29,743,662) (1,172,888) 29,010
============= ============= =========== ===========
See accompanying notes to financial statements.
99
STATEMENTS OF CHANGES IN NET ASSETS
TAX FREE FUND
---------------------------------------
SIX MONTHS ENDED
DECEMBER 31, 2005 YEAR ENDED
(UNAUDITED) JUNE 30, 2005
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- ------------------------------------------------------------------------------------------
Net investment income (loss) $ 422,409 $ 940,910
Net realized gain 73,639 154,365
Net unrealized appreciation (depreciation) (385,479) 488,415
------------ ------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS 110,569 1,583,690
DISTRIBUTIONS TO SHAREHOLDERS:
- ------------------------------------------------------------------------------------------
From net investment income (421,304) (938,868)
From net capital gains -- --
------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (421,304) (938,868)
FROM CAPITAL SHARE TRANSACTIONS:
- ------------------------------------------------------------------------------------------
Proceeds from shares sold 3,482,623 4,959,533
Distributions reinvested 388,103 867,531
Proceeds from short-term trading fees -- --
------------ ------------
3,870,726 5,827,064
Cost of shares redeemed (11,156,323) (12,205,425)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS (7,285,597) (6,378,361)
- ------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (7,596,332) (5,733,539)
- ------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 22,432,969 28,166,508
- ------------------------------------------------------------------------------------------
END OF PERIOD $ 14,836,637 $ 22,432,969
- ------------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(distributions in excess of net investment
income), end of period $ 27,316 $ 26,211
============ ============
CAPITAL SHARE ACTIVITY
- ------------------------------------------------------------------------------------------
Shares sold 284,630 403,159
Shares reinvested 31,818 70,591
Shares redeemed (917,432) (986,794)
------------ ------------
NET SHARE ACTIVITY (600,984) (513,044)
============ ============
See accompanying notes to financial statements.
100
CHINA REGION
ALL AMERICAN EQUITY FUND OPPORTUNITY FUND
-------------------------------------- ---------------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, 2005 YEAR ENDED DECEMBER 31, 2005 YEAR ENDED
(UNAUDITED) JUNE 30, 2005 (UNAUDITED) JUNE 30, 2005
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) $ (69,746) $ (17,399) $ (140,178) $ (174,051)
Net realized gain 1,482,724 1,502,686 3,139,995 1,467,778
Net unrealized appreciation (depreciation) 359,797 73,894 1,807,354 4,486,129
----------- ----------- ----------- -----------
NET INCREASE IN NET ASSETS FROM
OPERATIONS 1,772,775 1,559,181 4,807,171 5,779,856
DISTRIBUTIONS TO SHAREHOLDERS:
- ------------------------------------------------------------------------------------------------------------------------------------
From net investment income -- -- (909,532) (727,576)
From net capital gains (455,916) -- -- --
----------- ----------- ----------- -----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (455,916) -- (909,532) (727,576)
FROM CAPITAL SHARE TRANSACTIONS:
- ------------------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 1,420,140 3,408,040 6,615,233 9,341,110
Distributions reinvested 446,686 -- 876,930 697,792
Proceeds from short-term trading fees 390 1,380 7,472 60,238
----------- ----------- ----------- -----------
1,867,216 3,409,420 7,499,635 10,099,140
Cost of shares redeemed (1,975,176) (5,689,533) (4,585,052) (19,730,277)
----------- ----------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS (107,960) (2,280,113) 2,914,583 (9,631,137)
- ------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 1,208,899 (720,932) 6,812,222 (4,578,857)
- ------------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 19,253,063 19,973,995 30,510,709 35,089,566
- ------------------------------------------------------------------------------------------------------------------------------------
END OF PERIOD $20,461,962 $19,253,063 $37,322,931 $30,510,709
- ------------------------------------------------------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(distributions in excess of net investment
income), end of period $ (69,746) $ -- $(1,868,544) $ (818,834)
=========== =========== =========== ===========
CAPITAL SHARE ACTIVITY
- ------------------------------------------------------------------------------------------------------------------------------------
Shares sold 54,821 149,151 908,351 1,423,522
Shares reinvested 16,768 -- 115,690 105,248
Shares redeemed (76,643) (248,836) (635,779) (3,070,853)
----------- ----------- ----------- -----------
NET SHARE ACTIVITY (5,054) (99,685) 388,262 (1,542,083)
=========== =========== =========== ===========
101
STATEMENTS OF CHANGES IN NET ASSETS
GLOBAL RESOURCES FUND
-------------------------------------
SIX MONTHS ENDED
DECEMBER 31, 2005 YEAR ENDED
(UNAUDITED) JUNE 30, 2005
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- -----------------------------------------------------------------------------------------
Net investment income (loss) $ 3,877,704 $ 2,595,704
Net realized gain 40,771,894 38,599,722
Net unrealized appreciation (depreciation) 82,994,189 58,957,966
------------- -------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS 127,643,787 100,153,392
DISTRIBUTIONS TO SHAREHOLDERS:
- -----------------------------------------------------------------------------------------
From net investment income (16,043,181) (7,961,606)
From net capital gains (53,477,271) (6,887,607)
------------- -------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (69,520,452) (14,849,213)
FROM CAPITAL SHARE TRANSACTIONS:
- -----------------------------------------------------------------------------------------
Proceeds from shares sold 375,437,681 584,409,388
Distributions reinvested 65,860,313 14,127,634
Proceeds from short-term trading fees 47,934 78,875
------------- -------------
441,345,928 598,615,897
Cost of shares redeemed (199,085,826) (331,310,682)
------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS 242,260,102 267,305,215
- -----------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 300,383,437 352,609,394
- -----------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 488,183,437 135,574,043
- -----------------------------------------------------------------------------------------
END OF PERIOD $ 788,566,874 $ 488,183,437
- -----------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(distributions in excess of net investment
income), end of period $ (16,390,763) $ (4,225,286)
============= =============
CAPITAL SHARE ACTIVITY
- -----------------------------------------------------------------------------------------
Shares sold 26,049,980 50,711,235
Shares reinvested 4,615,299 1,353,225
Shares redeemed (14,003,342) (29,694,876)
------------- -------------
NET SHARE ACTIVITY 16,661,937 22,369,584
============= =============
See accompanying notes to financial statements.
102
WORLD PRECIOUS
MINERALS FUND GOLD SHARES FUND
------------------------------------- -------------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, 2005 YEAR ENDED DECEMBER 31, 2005 YEAR ENDED
(UNAUDITED) JUNE 30, 2005 (UNAUDITED) JUNE 30, 2005
INCREASE (DECREASE)
IN NET ASSETS
FROM OPERATIONS:
- ----------------------------------------------------------------------------------------------------------------------------------
Net investment income (loss) $ (936,387) $ (2,705,134) $ (225,559) $ (776,404)
Net realized gain 25,822,197 40,347,602 5,657,093 7,821,039
Net unrealized appreciation (depreciation) 75,295,616 (2,155,120) 22,430,100 (432,535)
------------- ------------- ------------- -------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS 100,181,426 35,487,348 27,861,634 6,612,100
DISTRIBUTIONS TO SHAREHOLDERS:
- ----------------------------------------------------------------------------------------------------------------------------------
From net investment income (11,327,580) (7,944,295) (1,018,347) (428,417)
From net capital gains (6,323,156) -- -- --
------------- ------------- ------------- -------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS (17,650,736) (7,944,295) (1,018,347) (428,417)
FROM CAPITAL SHARE TRANSACTIONS:
- ----------------------------------------------------------------------------------------------------------------------------------
Proceeds from shares sold 268,855,860 678,942,013 123,825,747 188,220,324
Distributions reinvested 16,536,899 7,470,390 941,813 393,191
Proceeds from short-term trading fees 566,595 1,362,092 273,772 397,737
------------- ------------- ------------- -------------
285,959,354 687,774,495 125,041,332 189,011,252
Cost of shares redeemed (276,783,410) (693,856,608) (120,799,273) (198,110,589)
------------- ------------- ------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS
FROM CAPITAL SHARE TRANSACTIONS 9,175,944 (6,082,113) 4,242,059 (9,099,337)
- ----------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS 91,706,634 21,460,940 31,085,346 (2,915,654)
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
Beginning of period 268,312,442 246,851,502 63,816,096 66,731,750
- ----------------------------------------------------------------------------------------------------------------------------------
END OF PERIOD $ 360,019,076 $ 268,312,442 $ 94,901,442 $ 63,816,096
- ----------------------------------------------------------------------------------------------------------------------------------
Accumulated undistributed net investment income
(distributions in excess of net investment
income), end of period $ (27,413,717) $ (15,149,750) $ (992,247) $ 251,659
============= ============= ============= =============
CAPITAL SHARE ACTIVITY
- ----------------------------------------------------------------------------------------------------------------------------------
Shares sold 15,528,567 44,715,320 14,254,381 24,910,192
Shares reinvested 851,979 460,566 91,795 48,363
Shares redeemed (15,975,482) (45,905,829) (13,801,382) (26,162,376)
------------- ------------- ------------- -------------
NET SHARE ACTIVITY 405,064 (729,943) 544,794 (1,203,821)
============= ============= ============= =============
103
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
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 a 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 a Fund's securities occur after
the close of the primary exchange
104
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
and before a 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. The Funds may
use a systematic fair value model provided by an independent third
party to value international securities.
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 a fund is 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.
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 agreement accounts with
other funds under common management where uninvested cash is
collectively invested in 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 failure of
the counterparty 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
105
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
amount of the premium. There were no written options open at
December 31, 2005.
Transactions in options purchased during the six months ended
December 31, 2005, 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, 2005 700 $ 81,743 6,565 $1,162,855 1,495 $ 318,959
Options purchased 25,716 21,376,232 8,850 1,947,995 8,540 1,526,108
Options sold (13,982) (11,267,798) (2,555) (626,240) (945) (268,211)
Options expired -- -- -- -- -- --
-------- ------------ ------ ---------- ----- ----------
Options outstanding
at December 31,
2005 12,434 $ 10,190,177 12,860 $2,484,610 9,090 $1,576,856
======== ============ ====== ========== ===== ==========
Transactions in written call options during the six months ended
December 31, 2005, were as follows:
GOLD SHARES FUND
---------------------------
NUMBER OF PREMIUMS
CONTRACTS PAID/(RECEIVED)
Options outstanding at June 30, 2005 -- $ --
Options written 225 59,616
Options terminated in closing purchase transactions (225) (59,616)
Options expired -- --
Options exercised -- --
---- --------
Options outstanding at December 31, 2005 -- $ --
==== ========
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 prevailing exchange rate. Security
transactions, income and expenses are converted at the prevailing
rate of exchange on the respective dates of the transaction. 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 or to
defend the portfolio against currency fluctuations. 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 difference between the forward foreign exchange rates at the
dates of entry into the contracts and the
106
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
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, 2005 were:
FOREIGN IN EXCHANGE SETTLEMENT UNREALIZED UNREALIZED
FUND CONTRACT CURRENCY FOR USD DATE VALUE APPRECIATION (DEPRECIATION)
-------------------------------------------------------------------------------------------------------------------------
All American Equity
SALES:
Canadian Dollar $ 21,000 $ 17,987 01/03/06 $ 18,016 $ -- $ (29)
Canadian Dollar 31,850 27,281 01/03/06 27,324 -- (43)
Canadian Dollar 31,855 27,285 01/03/06 27,328 -- (43)
---------- ---------- ---------- ------ -------
84,705 72,553 72,668 -- (115)
China Region Opportunity
SALES:
Canadian Dollar 15,534 13,305 01/17/06 13,326 -- (21)
Global Resources
PURCHASES:
British Pound 31,209 53,754 01/03/06 53,634 -- (120)
British Pound 1,737 3,000 01/03/06 2,985 -- (15)
British Pound 36,600 63,116 01/03/06 62,898 -- (218)
---------- ---------- ---------- ------ -------
69,546 119,870 119,517 -- (353)
SALES:
Canadian Dollar 2,740,694 2,347,490 01/03/06 2,351,215 -- (3,725)
Canadian Dollar 787,146 674,793 01/03/06 675,285 -- (492)
Canadian Dollar 491,995 426,894 01/12/06 422,078 4,816 --
Canadian Dollar 1,261,650 1,079,717 01/18/06 1,082,357 -- (2,640)
---------- ---------- ---------- ------ -------
5,281,485 4,528,894 4,530,935 4,816 (6,857)
World Precious Minerals
SALES:
Canadian Dollar 1,529,241 1,309,842 01/03/06 1,311,921 -- (2,079)
Canadian Dollar 856,525 734,269 01/03/06 734,805 -- (536)
Canadian Dollar 501,915 427,890 01/06/06 430,588 -- (2,698)
Canadian Dollar 228,000 194,789 01/17/06 195,599 -- (810)
British Pound 35,829 61,590 01/03/06 61,573 17 --
British Pound 35,396 61,040 01/03/06 60,830 210 --
---------- ---------- ---------- ------ -------
3,186,906 2,789,420 2,795,316 227 (6,123)
Gold Shares
SALES:
Canadian Dollar 75,944 65,048 01/03/06 65,152 -- (104)
Canadian Dollar 167,305 142,630 01/06/06 143,529 -- (899)
Canadian Dollar 76,000 64,930 01/17/06 65,200 -- (270)
---------- ---------- ---------- ------ -------
319,249 272,608 273,881 -- (1,273)
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.
107
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
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.
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 Fund held less than 30 days are subject to
a short-term trading fee equal to 0.25% of the proceeds of the
redeemed shares. Shares held in the World Precious Minerals and
Gold Shares Funds less than 30 days are subject to a short-term
trading fee equal to 0.50% 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, 2007,
furnishes management and
108
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
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.
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 period
ended December 31, 2005, 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 November 01, 2006, 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 year ended June 30, 2004, fees waived and/or
expenses reimbursed as a result of this agreement were $45,136 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. The U.S. Treasury
Securities Cash
109
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
Fund reimbursed the Adviser the previously waived amount of $45,136
during the six months ended December 31, 2005.
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, 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 the Funds during the
six months ended December 31, 2005, in the amounts of $116,483 and
$19,428, respectively.
During the six months ended December 31, 2005, A & B Mailers, Inc.,
a wholly-owned subsidiary of the Adviser, was paid $165,935 for
mailing services provided to the Funds.
The 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
Cost of purchases and proceeds from sales of long-term securities
for the six months ended December 31, 2005, are summarized as
follows:
FUND PURCHASES SALES
----------------------------------------------------------------------
Near-Term Tax Free $ 2,574,868 $ 4,725,019
Tax Free 2,695,617 9,619,755
All American Equity 33,471,625 34,721,305
China Region Opportunity 28,797,935 27,233,292
Global Resources 637,957,642 426,062,649
World Precious Minerals 67,098,711 76,532,234
Gold Shares 20,139,840 22,010,659
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.
Fair valued securities which were primarily composed of restricted
securities, as a percentage of net assets at December 31, 2005,
were 1.04% of China Region
110
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
Opportunity, 3.28% of Global Resources, 3.91% of World Precious Minerals
and 1.65% of Gold Shares.
Investments in foreign issuers as a percent of total investments at
December 31, 2005, were: 82.33% of China Region Opportunity, 59.84% of
Global Resources, 88.98% of World Precious Minerals and 77.76% of Gold
Shares.
NOTE 4: TAX INFORMATION
The following table presents the income tax basis of the securities
owned at December 31, 2005, 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 $107,521,295 $ -- $ -- $ --
U.S. Government Securities
Savings 403,736,513 -- -- --
Near-Term Tax Free 15,812,531 126,761 (180,256) (53,495)
Tax Free 14,060,413 630,386 -- 630,386
All American Equity 17,167,130 2,768,376 (462,954) 2,305,422
China Region Opportunity 29,695,239 7,868,160 (730,579) 7,137,581
Global Resources 629,748,521 161,567,723 (7,320,756) 154,246,967
World Precious Minerals 249,271,863 128,069,088 (17,084,122) 110,984,966
Gold Shares 62,144,188 35,821,761 (2,172,238) 33,649,523
As of June 30, 2005, the components of distributable earnings on a
tax basis were as follows:
UNDISTRIBUTED UNDISTRIBUTED UNDISTRIBUTED NET UNREALIZED
TAX EXEMPT ORDINARY LONG-TERM APPRECIATION
FUND INCOME INCOME CAPITAL GAINS (DEPRECIATION)
------------------------------------------------------------------------------------------
U.S. Treasury Securities
Cash $ -- $ 5,746 $ -- $ --
U.S. Government Securities
Savings -- 401,746 -- --
Near-Term Tax Free -- 17,634 -- 84,203
Tax Free 12,909 18,961 -- 1,015,867
All American Equity -- -- -- 1,911,068
China Region Opportunity -- 835,848 -- 3,650,266
Global Resources -- 30,142,003 7,775,842 61,322,149
World Precious Minerals -- 11,527,187 -- 7,009,770
Gold Shares -- 1,223,845 -- 10,043,528
The differences between book-basis and tax-basis unrealized
appreciation (depreciation) for China Region Opportunity, Global
Resources, World Precious Minerals and Gold Shares are attributable
primarily to the tax deferral of losses on wash sales and passive
foreign investment companies (PFIC).
111
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
The tax character of distributions paid during the six months ended
December 31, 2005, were as follows:
TAX-EXEMPT ORDINARY LONG-TERM
FUND INCOME INCOME CAPITAL GAINS TOTAL
----------------------------------------------------------------------------------------
U.S. Treasury Securities Cash $ -- $1,472,075 $ -- $ 1,472,075
U.S. Government Securities
Savings -- 6,446,910 -- 6,446,910
Near-Term Tax Free 213,836 40,036 -- 253,872
Tax Free 374,106 47,198 -- 421,304
All American Equity -- -- 455,916 455,916
China Region Opportunity -- 909,532 -- 909,532
Global Resources -- 59,079,652 10,440,800 69,520,452
World Precious Minerals -- 12,189,828 5,460,908 17,650,736
Gold Shares -- 1,018,347 -- 1,018,347
The tax character of distributions paid during the fiscal year
ended June 30, 2005, were as follows:
TAX-EXEMPT ORDINARY LONG-TERM
FUND INCOME INCOME CAPITAL GAINS TOTAL
----------------------------------------------------------------------------------------
U.S. Treasury Securities Cash $ -- $1,284,803 $ -- $ 1,284,803
U.S. Government Securities
Savings -- 7,229,289 -- 7,229,289
Near-Term Tax Free 490,494 34,594 -- 525,088
Tax Free 893,128 45,740 -- 938,868
All American Equity -- -- -- --
China Region Opportunity -- 727,576 -- 727,576
Global Resources -- 9,712,693 5,136,520 14,849,213
World Precious Minerals -- 7,944,295 -- 7,944,295
Gold Shares -- 428,417 -- 428,417
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, 2005, are as follows:
EXPIRATION DATE
FUND 2006 2007 2008 2009
-------------------------------------------------------------------------------------
U.S. Treasury Securities Cash $ -- $ 7,527 $ 10,657 $ --
U.S. Government Securities
Savings -- -- -- --
Near-Term Tax Free -- -- 17,590 59,454
Tax Free -- -- -- 338,259
All American Equity -- -- -- --
China Region Opportunity -- 1,396,956 4,657,144 3,347,272
Global Resources -- -- -- --
World Precious Minerals -- -- -- --
Gold Shares 49,313,088 50,050,196 2,931,501 4,098,335
112
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
EXPIRATION DATE
FUND 2010 2011 2012 2013 TOTAL
-------------------------------------------------------------------------------------
U.S. Treasury Securities
Cash $ -- $ 287 $ -- $ -- $ 18,471
U.S. Government
Securities Savings -- -- 12,079 -- 12,079
Near-Term Tax Free -- -- 46,218 33,686 156,948
Tax Free -- -- 90,567 421,236 850,062
All American Equity -- 119,602 -- -- 119,602
China Region Opportunity 193,867 80,860 -- -- 9,676,099
Global Resources -- -- -- -- --
World Precious Minerals 2,795,187 -- -- -- 2,795,187
Gold Shares -- 1,122,291 -- -- 107,515,411
POST OCTOBER 31, 2004 POST OCTOBER 31, 2004
FUND CAPITAL LOSS DEFERRAL CURRENCY LOSS DEFERRAL
--------------------------------------------------------------------------------
Near-Term Tax Free 297 --
Tax Free 18 --
The amounts above, in accordance with tax rules, are deemed to have
occurred on July 1, 2005.
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, 2005.
113
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) December 31, 2005
NOTE 7: SHARES OF BENEFICIAL INTEREST
At December 31, 2005, individual shareholders holding more than 5%
of outstanding shares comprised 8.25% of the Tax Free Fund. In
addition, the Adviser held 5.21% of the Near-Term Tax Free Fund.
NOTE 8: NEAR-TERM TAX FREE FUND STOCK SPLIT
Effective as of the close of business on January 3, 2005, Near-Term
Tax Free Fund instituted a 5-for-1 stock split. All capital share
activity and per share data for Near-Term Tax Free Fund for the
previous periods presented in these financial statements has been
adjusted to reflect the stock split.
114
FINANCIAL HIGHLIGHTS
U.S. TREASURY SECURITIES CASH FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income .01 .01 --(a) .01 .01 .05
Net realized and unrealized gain -- -- -- -- -- --
-------- -------- -------- -------- -------- --------
Total from investment activities .01 .01 --(a) .01 .01 .05
-------- -------- -------- -------- -------- --------
Distributions from net investment income (.01) (.01) --(a) (.01) (.01) (.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) 1.27% 1.12% .08% .57% 1.43% 4.59%
Ratios to Average Net Assets (c):
Net investment income 2.50% 1.11% .07% .52% 1.43% 4.62%
Total expenses .95% .97% 1.00% .97% 1.00% 1.06%
Expenses reimbursed or offset --(d) --(d) (.04)% --(d) --(d) --(d)
Net recouped fees .07% -- -- -- -- --
Net expenses 1.02% .97% .96% .97% 1.00% 1.06%
NET ASSETS, END OF PERIOD (IN THOUSANDS) $108,805 $124,058 $112,575 $123,879 $134,930 $130,832
U.S. GOVERNMENT SECURITIES SAVINGS FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- -----------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income .02 .02 .01 .01 .02 .05
Net realized and unrealized gain -- -- -- -- -- --
-------- -------- -------- -------- -------- --------
Total from investment activities .02 .02 .01 .01 .02 .05
-------- -------- -------- -------- -------- --------
Distributions from net investment income (.02) (.02) (.01) (.01) (.02) (.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) 1.60% 1.70% .63% 1.09% 2.20% 5.42%
Ratios to Average Net Assets (c):
Net investment income 3.16% 1.67% .61% 1.08% 2.20% 5.41%
Total expenses .66% .65% .65% .61% .59% .60%
Expenses reimbursed or offset (.21)% (.20)% (.20)% (.16)% (.14)% (.20)%
Net expenses .45% .45% .45% .45% .45% .40%
NET ASSETS, END OF PERIOD (IN THOUSANDS) $404,842 $411,979 $441,722 $529,829 $691,843 $782,242
<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.
(d) Ratio does not round to 0.01%.
</FN>
See accompanying notes to financial statements.
115
FINANCIAL HIGHLIGHTS
NEAR-TERM TAX FREE FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005* 2004* 2003* 2002* 2001*
NET ASSET VALUE, BEGINNING OF PERIOD $2.17 $2.17 $2.23 $2.16 $2.12 $2.06
- --------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income .03 .07 .06 .06 .08 .09
Net realized and unrealized gain
(loss) (.02) (.01) (.06) .07 .04 .06
------- ------- ------- ------- ------ ------
Total from investment activities .01 .06 .00 .13 .12 .15
------- ------- ------- ------- ------ ------
Distributions from net investment
income (.03) (.06) (.06) (.06) (.08) (.09)
- --------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $2.15 $2.17 $2.17 $2.23 $2.16 $2.12
- --------------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (a) .56% 2.75% .20% 5.97% 5.65% 7.21%
Ratios to Average Net Assets (b):
Net investment income 2.96% 2.79% 2.73% 2.83% 3.73% 4.15%
Total expenses 1.55% 1.49% 1.25% 1.44% 2.63% 2.72%
Expenses reimbursed or offset (1.10)% (1.04)% (.80)% (.94)% (2.01)% (2.02)%
Net expenses .45% .45% .45% .50% .62% .70%
Portfolio turnover rate 16% 5% 21% 20% 19% 23%
NET ASSETS, END OF PERIOD (IN THOUSANDS) $15,993 $18,706 $18,673 $21,979 $9,752 $6,035
TAX FREE FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $12.33 $12.08 $12.65 $12.18 $11.95 $11.38
- ----------------------------------------------------------------------------------------------------
Investment Activities
Net investment income .26 .44 .43 .42 .50 .53
Net realized and unrealized gain
(loss) (.16) .25 (.58) .48 .23 .57
------- ------- ------- ------- ------- -------
Total from investment activities .10 .69 (.15) .90 .73 1.10
------- ------- ------- ------- ------- -------
Distributions
From net investment income (.25) (.44) (.42) (.43) (.50) (.53)
------- ------- ------- ------- ------- -------
Total distributions (.25) (.44) (.42) (.43) (.50) (.53)
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.18 $12.33 $12.08 $12.65 $12.18 $11.95
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees)
(a) .83% 5.78% (1.25)% 7.49% 6.18% 9.81%
Ratios to Average Net Assets (b):
Net investment income 3.79% 3.50% 3.22% 3.34% 4.13% 4.50%
Total expenses 1.58% 1.47% 1.09% 1.22% 1.56% 1.53%
Expenses reimbursed or offset (.88)% (.77)% (.39)% (.52)% (.86)% (.83)%
Net expenses .70% .70% .70% .70% .70% .70%
Portfolio turnover rate 14% 40% 54% 26% 22% 19%
NET ASSETS, END OF PERIOD (IN THOUSANDS) $14,837 $22,433 $28,167 $55,283 $21,698 $20,248
<FN>
* The values shown for Near-Term Tax Free Fund for the current period
and prior periods have been adjusted to reflect the 5-for-1 stock
split, which was effective on January 3, 2005.
(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.
</FN>
See accompanying notes to financial statements.
116
FINANCIAL HIGHLIGHTS
ALL AMERICAN EQUITY FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $24.47 $22.53 $19.15 $21.20 $25.44 $45.18
- ----------------------------------------------------------------------------------------------------
Investment Activities
Net investment income (loss) (.09) (.02) (.11) (.03) (.03) .08
Net realized and unrealized gain
(loss) 2.39 1.96 3.49 (2.02) (4.20) (11.42)
------- ------- ------- ------- ------- -------
Total from investment activities 2.30 1.94 3.38 (2.05) (4.23) (11.34)
------- ------- ------- ------- ------- -------
Distributions
From net investment income -- -- -- -- (.01) (.08)
From net realized gains (.59) -- -- -- -- (8.32)
------- ------- ------- ------- ------- -------
Total distributions (.59) -- -- -- (.01) (8.40)
Short-Term Trading Fees* (a) -- -- -- -- -- --
- ----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $26.18 $24.47 $22.53 $19.15 $21.20 $25.44
- ----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (b) 9.36% 8.61% 17.65% (9.67)% (16.62)% (27.96)%
Ratios to Average Net Assets (c):
Net investment income (loss) (.69)% (.09)% (.49)% (.12)% (.12)% .25%
Total expenses 2.23% 2.44% 2.31% 2.56% 2.19% 1.69%
Expenses reimbursed or offset (.48)% (.69)% (.56)% (1.06)% (.73)% (.69)%
Net expenses 1.75% 1.75% 1.75% 1.50% 1.46% 1.00%
Portfolio turnover rate 184% 262% 96% 119% 75% 85%
NET ASSETS, END OF PERIOD (IN THOUSANDS) $20,462 $19,253 $19,974 $18,334 $20,713 $26,942
CHINA REGION OPPORTUNITY FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $6.87 $5.86 $4.17 $4.38 $4.92 $6.11
- --------------------------------------------------------------------------------------------------------------
Investment Activities
Net investment loss (.02) (.06) --* (.02) (.04) (.04)
Net realized and unrealized gain
(loss) 1.07 1.22 1.69 (.20) (.51) (1.11)
------- ------- ------- ------- ------- -------
Total from investment activities 1.05 1.16 1.69 (.22) (.55) (1.15)
------- ------- ------- ------- ------- -------
Distributions
From net investment income (.19) (.16) (.05) -- -- (.06)
------- ------- ------- ------- ------- -------
Total distributions (.19) (.16) (.05) -- -- (.06)
Short-Term Trading Fees* --(a) .01 .05 .01 .01 .02
- --------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $7.73 $6.87 $5.86 $4.17 $4.38 $4.92
- --------------------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (b) 15.40% 19.98% 41.63% (4.79)% (10.98)% (18.45)%
Ratios to Average Net Assets (c):
Net investment income (loss) (.84)% (.54)% .05% (.60)% (.83)% (.56)%
Total expenses 2.42% 2.56% 2.25% 3.91% 3.54% 3.04%
Expenses reimbursed or offset (d) -- -- -- -- -- --
Net expenses 2.42% 2.56% 2.25% 3.91% 3.54% 3.04%
Portfolio turnover rate 90% 136% 126% 44% 29% 4%
NET ASSETS, END OF PERIOD (IN THOUSANDS) $37,323 $30,511 $35,090 $12,815 $12,003 $15,123
<FN>
* Based on average monthly shares outstanding.
(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.
(d) Ratio does not round to 0.01%.
</FN>
See accompanying notes to financial statements.
117
FINANCIAL HIGHLIGHTS
GLOBAL RESOURCES FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $12.67 $8.39 $5.14 $4.93 $4.01 $3.88
- ------------------------------------------------------------------------------------------------------------------
Investment Activities
Net investment income (loss) .13 .25 .12 (.05) (.06) (.06)
Net realized and unrealized gain 2.86 4.67 3.26 .35 .98 .19
-------- -------- -------- ------- ------- -------
Total from investment activities 2.99 4.92 3.38 .30 .92 .13
-------- -------- -------- ------- ------- -------
Distributions
From net investment income (.32) (.34) (.13) (.09) -- --
From net realized gains (1.05) (.30) -- -- -- --
-------- -------- -------- ------- ------- -------
Total distributions (1.37) (.64) (.13) (.09) -- --
Short-Term Trading Fees* (a) -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $14.29 $12.67 $8.39 $5.14 $4.93 $4.01
- ------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (b) 23.57% 60.21% 65.73% 6.43% 22.94% 3.35%
Ratios to Average Net Assets (c):
Net investment income (loss) 1.16% .91% .74% (1.38)% (1.57)% (1.47)%
Total expenses .98% 1.30% 1.54% 3.75% 3.83% 3.61%
Expenses reimbursed or offset (.01)% --(d) --(d) --(d) --(d) --(d)
Net expenses .97% 1.30% 1.54% 3.75% 3.83% 3.61%
Portfolio turnover rate 71% 116% 140% 101% 96% 65%
NET ASSETS, END OF PERIOD (IN
THOUSANDS) $788,567 $488,183 $135,574 $14,884 $14,900 $11,887
WORLD PRECIOUS MINERALS FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $15.50 $13.68 $9.75 $10.43 $5.28 $6.43
- ---------------------------------------------------------------------------------------------------------------
Investment Activities
Net investment loss (.01) (.22) (.17)* (.05) (.07) (.10)
Net realized and unrealized gain (loss) 5.84 2.42 5.85 (.52) 5.18 (1.04)
-------- -------- -------- -------- ------- --------
Total from investment activities 5.83 2.20 5.68 (.57) 5.11 (1.14)
-------- -------- -------- -------- ------- --------
Distributions
From net investment income (.67) (.46) (1.86) (.25) -- (.02)
From net realized gains (.37)
-------- -------- -------- -------- ------- --------
Total distributions (1.04) (.46) (1.86) (.25) -- (.02)
Short-Term Trading Fees* .03 .08 .11 .14 .04 .01
- ---------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $20.32 $15.50 $13.68 $9.75 $10.43 $5.28
- ---------------------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account
fees) (b) 38.15% 16.50% 57.42% (4.02)% 97.54% (17.54)%
Ratios to Average Net Assets (c):
Net investment loss (.61)% (1.01)% (1.15)% (1.36)% (1.32)% (1.51)%
Total expenses 1.36% 1.48% 1.47% 1.92% 2.27% 2.86%
Expenses reimbursed or offset (d) -- -- -- -- -- --
Net expenses 1.36% 1.48% 1.47% 1.92% 2.27% 2.86%
Portfolio turnover rate 24% 55% 65% 141% 104% 68%
NET ASSETS, END OF PERIOD (IN
THOUSANDS) $360,019 $268,312 $246,852 $107,212 $97,044 $42,455
<FN>
* Based on average monthly shares outstanding.
(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.
(d) Ratio does not round to 0.01%.
</FN>
See accompanying notes to financial statements.
118
FINANCIAL HIGHLIGHTS
GOLD SHARES FUND
FOR A CAPITAL SHARE OUTSTANDING DURING THE SIX MONTHS ENDED DECEMBER 31, 2005
(UNAUDITED) AND EACH YEAR ENDED JUNE 30,
12/05 2005 2004 2003 2002 2001
NET ASSET VALUE, BEGINNING OF PERIOD $7.67 $7.00 $5.18 $5.28 $2.83 $2.92
- -----------------------------------------------------------------------------------------------------
Investment Activities
Net investment loss (.02) (.11) (.10) (.10) (.06) (.09)
Net realized and unrealized gain (loss) 3.14 .79 1.91 (.02) 2.48 (.01)
------- ------- ------- ------- ------- -------
Total from investment activities 3.12 .68 1.81 (.12) 2.42 (.10)
------- ------- ------- ------- ------- -------
Distributions
From net investment income (.12) (.05) (.03) -- -- --
------- ------- ------- ------- ------- -------
Total distributions (.12) (.05) (.03) -- -- --
Short-Term Trading Fees* .03 .04 .04 .02 .03 .01
- -----------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $10.70 $7.67 $7.00 $5.18 $5.28 $2.83
- -----------------------------------------------------------------------------------------------------
TOTAL RETURN (excluding account fees) (a) 41.11% 10.19% 35.57% (1.89)% 86.57% (3.08)%
Ratios to Average Net Assets (b):
Net investment loss (.55)% (1.13)% (1.45)% (1.98)% (1.99)% (2.93)%
Total expenses 1.72% 1.97% 1.93% 2.64% 3.57% 5.79%
Expenses reimbursed or offset (c) -- -- -- -- -- --
Net expenses 1.72% 1.97% 1.93% 2.64% 3.57% 5.79%
Portfolio turnover rate 28% 66% 85% 138% 164% 95%
NET ASSETS, END OF PERIOD (IN THOUSANDS) $94,901 $63,816 $66,732 $45,720 $52,911 $22,231
<FN>
* Based on average monthly shares outstanding.
(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.
(c) Ratio does not round to 0.01%.
</FN>
See accompanying notes to financial statements.
119
ADDITIONAL INFORMATION (UNAUDITED)
PROXY VOTING
A description of the policies and procedures that the Funds use to
determine how to vote proxies relating to portfolio securities is
available without charge, upon request, by calling 1-800-US-FUNDS
(1-800-873-8637). It also appears in the Funds' statement of
additional information (Form 485B), which can be found on the SEC's
website at www.sec.gov.
Information regarding how the Funds voted proxies relating to
portfolio securities during the most recent 12-month period ended
June 30 is available without charge, upon request, by calling
1-800-US-FUNDS (1-800-873-8637) or accessing the Funds' Form N-PX
on the SEC's website at www.sec.gov.
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULES
The Funds provide complete lists of holdings four times in each
fiscal year, at the quarter-ends. For the second and fourth
quarters, the lists appear in the Funds' semi-annual and annual
reports to shareholders. For the first and third quarters, the
Funds file the lists with the SEC on Form N-Q. Shareholders can
look up the Funds' Forms N-Q on the SEC's website at www.sec.gov.
You may also visit or call the SEC's Public Room in Washington,
D.C. (1-202-942-8090) or send a request plus a duplicating fee to
the SEC, Public Reference Section, Washington, DC 20549-0102 or by
electronic request at the following e-mail address:
publicinfo@sec.gov.
120
NOTES
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<Page>
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. SCHEDULE OF INVESTMENTS.
Not applicable. The complete schedule of investments is included in Item 1 of
this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASE OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 11. 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 second fiscal quarter of the
period covered by this report that has materially affected, or is
reasonably likely to materially affect, the registrant's internal control
over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Required only in annual report on Form N-CSR.
(a)(2) Certifications of principal executive officer and principal financial
officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002.
(b) Certifications of principal executive officer and principal financial
officer pursuant to section 906 of the Sarbanes-Oxley Act of 2002.
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 8, 2006
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 8, 2006
By: /s/ Catherine A. Rademacher
-----------------------------------
Catherine A. Rademacher
Treasurer
Date: March 8, 2006
EXHIBIT INDEX
(a)(2) Certifications of principal executive officer and principal financial
officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
(b) Certifications of principal executive officer and principal financial
officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002