Form N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-3489
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The Wright Managed Equity Trust
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(Exact Name of Registrant as Specified in Charter)
Eaton Vance Management
Two International Place, Boston, Massachusetts 02110
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(Address of Principal Executive Offices)
Janet E. Sanders
Eaton Vance Management,Two International Place, Boston, Massachusetts 02110
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(Name and Address of Agent for Services)
(617) 482-8260
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(Registrant's Telephone Number)
December 31
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Date of Fiscal Year End
June 30, 2009
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Date of Reporting Period
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ITEM 1. REPORTS TO STOCKHOLDERS
THE WRIGHT MANAGED BLUE CHIP INVESTMENT FUNDS
SEMI-ANNUAL REPORT
JUNE 30, 2009
THE WRIGHT MANAGED EQUITY TRUST
o Wright Selected Blue Chip Equities Fund
o Wright Major Blue Chip Equities Fund
o Wright International Blue Chip Equities Fund
THE WRIGHT MANAGED INCOME TRUST
o Wright Total Return Bond Fund
o Wright Current Income Fund
THE WRIGHT MANAGED BLUE CHIP INVESTMENT FUNDS CONSIST OF THREE EQUITY FUNDS FROM
THE WRIGHT MANAGED EQUITY TRUST AND TWO FIXED INCOME FUNDS FROM THE WRIGHT
MANAGED INCOME TRUST. EACH OF THE FIVE FUNDS HAVE DISTINCT INVESTMENT OBJECTIVES
AND POLICIES. THEY CAN BE USED INDIVIDUALLY OR IN COMBINATION TO ACHIEVE
VIRTUALLY ANY OBJECTIVE. FURTHER, AS THEY ARE ALL "NO-LOAD" FUNDS (NO
COMMISSIONS OR SALES CHARGES), PORTFOLIO ALLOCATION STRATEGIES CAN BE ALTERED AS
DESIRED TO MEET CHANGING MARKET CONDITIONS OR CHANGING REQUIREMENTS WITHOUT
INCURRING ANY SALES CHARGES.
APPROVED WRIGHT INVESTMENT LIST
Securities selected for investment in these funds are chosen mainly from a list
of "investment grade" companies maintained by Wright Investors' Service
("Wright" or the "Adviser"). Over 31,000 global companies (covering 63
countries) in Wright's database are screened as new data becomes available to
determine any eligible additions or deletions to the list. The qualifications
for inclusion as "investment grade" are companies that meet Wright's Quality
Rating criteria. This rating includes fundamental criteria for investment
acceptance, financial strength, profitability & stability and growth. In
addition, securities, which are not included in Wright's "investment grade"
list, may also be selected from companies in the fund's specific benchmark (up
to 20% of the market value of the portfolio) in order to achieve broad
diversification. Different quality criteria may apply for the different funds.
For example, the companies in the Major Blue Chip Fund would require a higher
Investment Acceptance rating than the companies in the Selected Blue Chip Fund.
THREE EQUITY FUNDS
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WSBC) (the Fund) seeks to enhance total
investment return through price appreciation plus income. The Fund's portfolio
is characterized as a blend of growth and value stocks. The market
capitalization of the companies is typically between $1-$10 billion at the time
of the Fund's investment. The Adviser seeks to outperform the Standard & Poor's
400 Index (S&P 400) by selecting stocks using fundamental company analysis and
company specific criteria such as valuation and earnings trends. The portfolio
is then diversified across industries and sectors.
WRIGHT MAJOR BLUE CHIP EQUITIES FUND (WMBC) (the Fund) seeks to enhance total
investment return through price appreciation plus income by providing a broadly
diversified portfolio of equities of larger well-established companies with
market values of $10 billion or more. The Adviser seeks to outperform the
Standard & Poor's 500 Index (S&P 500) by selecting stocks, using fundamental
company analysis and company specific criteria such as valuation and earnings
trends. The portfolio is then diversified across industries and sectors.
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND (WIBC) (the Fund) seeks total
return consisting of price appreciation plus income by investing in a broadly
diversified portfolio of equities of well-established, non-U.S. companies. The
Fund may buy common stocks traded on the securities exchange of the country in
which the company is based or it may purchase American Depositary Receipts
(ADR's) traded in the United States. The portfolio is denominated in U.S.
dollars and investors should understand that fluctuations in foreign exchange
rates may impact the value of their investment. The Adviser seeks to outperform
the MSCI Developed World ex U.S. Index by selecting stocks using fundamental
company analysis and company-specific criteria such as valuation and earnings
trends. The portfolio is then diversified across industries, sectors and
countries.
TWO FIXED-INCOME FUNDS
WRIGHT TOTAL RETURN BOND FUND (WTRB) (the Fund) is a diversified portfolio of
investment grade government and corporate bonds and other debt securities of
varying maturities which, in the Adviser's opinion, will achieve the portfolio
objective of best total return (i.e. the total of ordinary income plus capital
appreciation). Accordingly, investment selections and maturities may differ
depending on the particular phase of the interest rate cycle. Dividends are
accrued daily and paid monthly. The Fund's benchmark is the Barclays Capital
U.S. Aggregate Bond Index.
WRIGHT CURRENT INCOME FUND (WCIF) (the Fund) may be invested in a variety of
securities and may use a number of strategies, including GNMAs, to produce a
high level of income with reasonable stability of principal. The Fund reinvests
all principal payments. Dividends are accrued daily and paid monthly. The Fund's
benchmark is the Barclays Capital GNMA Backed Bond Index.
TABLE OF CONTENTS
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INVESTMENT OBJECTIVES................................inside front & back cover
LETTER TO SHAREHOLDER........................................................2
MANAGEMENT DISCUSSION........................................................4
FUND EXPENSES................................................................9
BOARD OF TRUSTEES ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENT......57
IMPORTANT NOTICES REGARDING PRIVACY, DELIVERY OF SHAREHOLDER DOCUMENTS,
PORTFOLIO HOLDINGS AND PROXY VOTING.......................................58
FINANCIAL STATEMENTS
THE WRIGHT MANAGED EQUITY TRUST
WRIGHT SELECTED BLUE CHIP EQUITIES FUND
Portfolio of Investments..................11
Statement of Assets and Liabilities.......14
Statement of Operations...................14
Statements of Changes in Net Assets.......15
Financial Highlights......................16
WRIGHT MAJOR BLUE CHIP EQUITIES FUND
Portfolio of Investments..................17
Statement of Assets and Liabilities.......20
Statement of Operations...................20
Statements of Changes in Net Assets.......21
Financial Highlights......................22
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND
Portfolio of Investments..................23
Statement of Assets and Liabilities.......26
Statement of Operations...................26
Statements of Changes in Net Assets.......27
Financial Highlights......................28
NOTES TO FINANCIAL STATEMENTS...............29
THE WRIGHT MANAGED INCOME TRUST
WRIGHT TOTAL RETURN BOND FUND
Portfolio of Investments..................36
Statement of Assets and Liabilities.......41
Statement of Operations...................41
Statements of Changes in Net Assets.......42
Financial Highlights......................43
WRIGHT CURRENT INCOME FUND
Portfolio of Investments..................44
Statement of Assets and Liabilities.......48
Statement of Operations...................48
Statements of Changes in Net Assets.......49
Financial Highlights......................50
NOTES TO FINANCIAL STATEMENTS...............51
LETTER TO SHAREHOLDERS
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July 2009
Dear Shareholders:
The second quarter of 2009 saw the best stock market returns for any
quarter since 1998, as the global economic nosedive started to show signs of
reversing. For the S&P 500, which had a total return of nearly 16%, each month
of the quarter had a positive return - although as is often the case early in a
bull market, the monthly returns diminished as investors put distance between
themselves and the March 9 bottom: April, +9.6%; May, +5.6%; June, +0.2%. On an
equal-weighted basis, the average second-quarter return for the S&P 500
constituents was 25%, the best result in at least 20 years. This disparity
between the S&P 500 benchmark and the equal-weighted S&P 500 points up the
superior performance of smaller-cap stocks during the second quarter. Foreign
stocks were also generally ahead of the U.S. stock market, especially after the
dollar's 7% depreciation in the quarter.
In the economy, the most recent data suggest that recovery will not
proceed in a straight line. (When does it ever?) As bad as the global economic
slump has been, though, the combined effects of massive economic stimulus,
pent-up demand, balance sheet repair, and the mere passage of time are putting
in place the stuff of recovery. At midyear, the recession is now 18 months in
duration, the longest since the 1930s and on a par with the recessions of
1973-74 and 1981-82 in severity. Our view is that the recession's end will come
in 2009's third or fourth quarter. This would put the stock market's March
bottom some four to eight months ahead of the start of economic recovery, a lead
that is consistent with the historical record of stocks as a leading economic
indicator.
Money market liquidity continues to normalize, and the credit market
has moved in the direction of normalcy as well. Although spreads have tightened
some, yield spreads on corporate securities relative to Treasurys remain
elevated. While wide spreads on the one hand mean that bond investors do not
entirely endorse the rally in stock prices, they also provide an investment
opportunity for fixed-income and balanced account investors. Credit woes were
the proximate cause of the bear market of 2007-09, much as credit excesses
created the real estate bubble preceding it, so the return of the credit market
to good health is a necessary condition for the current stock market rally to be
sustained, in our view. In the aggregate, nonfinancial corporations have shown a
fair amount of fiscal discipline in an age of excess; the outstanding debt of
nonfinancial corporate business was 51% of GDP at the end of March, up from 47%
in 2000 - easily the smallest increase of any major sector of the U.S. economy.
It stands to reason that deleveraging throughout the economy might act as a
governor on GDP growth in the near to intermediate term, which suggests credit
rating downgrades may stay heavy. Further down the road, stronger corporate
balance sheets should make for less risk for investors in credit, even as the
Treasury yield curve rises with the massive government borrowing to come.
At its June high, the S&P 500 had risen 40% off the March bottom, one
of the steepest market rallies in more than 50 years. At first glance, the speed
of the market's climb might seem inappropriate given the still considerable
difficulties facing the economy. But in view of the stock market's role as
discounting mechanism for the economy and corporate profits, and given the fact
that we have now endured two major bear markets in the space of nine years, the
rally no longer looks so strange. Might we fall back to and below the market's
March lows? That eventuality is a very low probability, in our view. Should
worse come to worst, of course, even a repeat of the Great Depression cannot be
ruled out. But liquidity (improved), credit (improved) and volatility (reduced)
suggest otherwise, as does the occasional economic indictor - e.g., May's
surprisingly good rise in durable goods orders. Investors are clearly more
inclined to take risks this year, which explains how emerging markets
outdistanced developed markets and how high yield bonds have led in the credit
markets.
The fact that investors are less averse to risk also helps explain the
dollar's 7% decline against a basket of foreign currencies during the second
quarter and why Treasurys were the weakest sector of the bond market. These
results were no doubt also influenced by the gaping federal deficit, which put a
net $175 billion of new Treasurys onto the market during Q2 ($340 billion in new
issuance less $165 billion of Treasurys purchased by the Federal Reserve (the
"Fed") as part of its open market operations). Despite the Fed's program of
buying Treasurys, Agencys and Mortgages, 10-year Treasury bond yields increased
87 basis points during the quarter and rates on two-year T-notes rose 31 basis
points, an increase restrained by the Federal Reserve's commitment to holding
short-term interest rates low for "an extended period." With big trade and
budget deficits looming for years to come, the value of the dollar will probably
be subject to gradual erosion against the major foreign currencies. We also see
some modest downside to Treasury bond prices ahead, although the growing supply
of government bonds should be partly offset by shrinking supply on the private
side of the economy.
Wright forecasts that the 2008-09 recession will end in this year's
second half. We also believe that the economic recovery will take some time
before it pushes GDP back to its trend growth rate of 2.5%. Inventory
rebuilding, a recovery of sorts in housing, and the release of pent-up consumer
demand will be driven by the cumulative effects of two years of aggressive
monetary and fiscal policy stimuli that should become increasingly apparent as
2009 winds down. The risk of rising inflation is minimal for the short to
intermediate term since, as noted three months ago, there is too much slack in
world resource utilization to get too excited about inflation in 2009 or 2010.
As decades of excessive use of debt throughout the U.S. economy are
unwound, a period of GDP and earnings growth below the economy's long-term norms
seems a reasonable expectation. Does it follow that stock returns will likewise
be below normal? Perhaps so, but the legacy of two major bear markets in one
decade is that return expectations for stocks have been beaten down. Stock
prices dramatically overshot corporate earnings in the violent decline seen late
last year and early in 2009, much as they overshot on the upside nine years
earlier. We would not be surprised if over the next several years stocks produce
above-average investment returns in real terms. If you have any questions or
suggestions on how we can better serve your investment and wealth management
needs, please let us know.
Sincerely,
s/s Peter M.Donovsn
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Peter M. Donovan
Chairman & CEO
MANAGEMENT DISCUSSION
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EQUITY FUNDS
THE SECOND QUARTER OF 2009 WAS THE BEST QUARTER FOR EQUITIES IN MORE THAN 10
YEARS. TO PUT THE S&P 500'S 16% RETURN FOR THE QUARTER IN PERSPECTIVE, THE RALLY
THAT BEGAN IN MARCH FOLLOWED A BEAR MARKET THAT TOOK THE S&P 500 DOWN 57% FROM
ITS 2007 PEAK - A PLUNGE WHICH MOST INVESTORS DON'T NEED TO BE REMINDED OF. THE
IMPROVED CONFIDENCE THAT THE STOCK MARKET RALLY REFLECTED WAS NOT BASED JUST ON
WISHFUL THINKING. REPORTS OF IMPROVEMENT IN THE FINANCIAL CONDITION OF THE
BANKING SECTOR HELPED KICK OFF THE RALLY. LATER IN THE QUARTER, SOME FINANCIAL
INSTITUTIONS BEGAN TO PAY BACK THE TARP FUNDS LOANED TO THEM BY THE GOVERNMENT
TO BOLSTER CONFIDENCE IN THE BANKING SYSTEM. THE MARKETS RESPONDED POSITIVELY TO
THE FED'S PURCHASES OF TREASURY AND MORTGAGE SECURITIES TO ADD LIQUIDITY TO THE
FINANCIAL MARKETS. AT THE SAME TIME IT WAS DOING THIS, THE FED WAS ABLE TO
WITHDRAW SOME OF THE LIQUIDITY IT HAD PROVIDED TO SUPPORT THE SHORT-TERM CREDIT
MARKETS - AN INDICATION THAT THE FUNCTIONING OF THE FINANCIAL MARKETS WAS MOVING
TOWARD NORMAL - AND REDUCE ITS DIRECT LENDING TO BANKS. THE BANKRUPTCIES OF
CHRYSLER AND GENERAL MOTORS DIDN'T PUT MUCH OF AN OBSTACLE IN THE STOCK MARKET'S
WAY, PERHAPS REFLECTING RELIEF THAT THE "WILL THEY OR WON'T THEY" QUESTION WAS
FINALLY RESOLVED. WHILE CONFIDENCE IN THE FINANCIAL SYSTEM WAS GROWING, ECONOMIC
DATA BEGAN TO SHOW THE FIRST MODEST "GREEN SHOOTS" OF RECOVERY, SIGNS THAT
EMPLOYMENT, HOUSING AND MANUFACTURING, THOUGH NOT YET ON AN UPSWING, MAY BE
STABILIZING.
AT ITS PEAK ON JUNE 12, THE S&P 500 WAS UP 40% IN PRICE IN THE THREE MONTHS FROM
ITS MARCH LOW. AS IMPRESSIVE AS IT WAS, THE S&P 500'S 16% RETURN FOR THE SECOND
QUARTER OF 2009 WAS OUTDONE BY NASDAQ'S 20% RETURN; THE DOW LAGGED BUT WAS STILL
IN DOUBLE-DIGITS WITH A 12% RETURN FOR THE QUARTER. THEIR STRONG SHOWINGS IN Q2
WERE ENOUGH TO PUT THE S&P 500 AND NASDAQ IN POSITIVE TERRITORY FOR THE YEAR TO
DATE, WITH RETURNS OF 3.2% AND 16.4%, RESPECTIVELY; THE DOW ENDED THE HALF STILL
ABOUT 2% BEHIND FOR THE YEAR. IN A SIGN OF GROWING CONFIDENCE, INVESTORS WERE
PARTIAL TO SMALLER STOCKS IN Q2, WITH THE S&P MIDCAP 400 JUMPING NEARLY 19% FOR
THE QUARTER WHILE THE SMALLCAP 600 ADDED 21%. THE MIDCAPS WERE AHEAD OF THE S&P
500'S 3.2% RETURN FOR THE FIRST SIX MONTHS OF 2009 WITH AN 8.5% GAIN, WHILE THE
SMALLCAPS LAGGED WITH A RETURN OF LESS THAN 1% YEAR TO DATE. THE STRENGTH OF THE
STOCK MARKET FROM ITS MARCH LOW WAS BROAD BASED. FINANCIAL STOCKS, BEATEN DOWN
THE MOST DURING THE BEAR MARKET, INCREASED BY NEARLY 35% IN PRICE IN THE
APRIL-JUNE QUARTER. INTERNATIONAL STOCK MARKETS IN THE AGGREGATE OUTPERFORMED
THE S&P 500 IN THE SECOND QUARTER OF 2009. THE MSCI WORLD EX U.S. STOCK MARKET
INDEX RETURNED 17% IN LOCAL CURRENCIES IN THE QUARTER. IN A REVERSAL OF THE
STRONG DOLLAR EFFECT IN 2008 AND THE FIRST QUARTER, Q2'S DOLLAR DEPRECIATION
AGAINST THE CURRENCIES IN THE MSCI WORLD EX U.S. INDEX BENEFITTED THE RETURN TO
DOLLAR-BASED INVESTORS. THE MSCI WORLD EX U.S. INDEX RETURNED NEARLY 26% IN
DOLLAR TERMS IN Q2, BRINGING ITS YEAR-TO-DATE GAIN TO 9.3%, NEARLY TRIPLE THE
RETURN OF THE S&P 500. THE MSCI'S EMERGING MARKETS INDEX RETURNED 35% IN DOLLARS
IN Q2.
AT ABOUT 14 TIMES EXPECTED NEXT 12 MONTHS' EARNINGS AT JUNE 30, THE S&P 500'S
P/E MULTIPLE WAS BELOW THE AVERAGE OF THE LAST 20 YEARS EVEN AFTER THE SECOND
QUARTER'S RALLY IN STOCK PRICES. HOWEVER, WE THINK INVESTORS MAY BE CAUTIOUS
ABOUT PUSHING MULTIPLES UP SIGNIFICANTLY IN THE NEAR TERM; THE FIRM PROSPECT OF
EARNINGS GROWTH MAY HAVE TO BE THE DRIVER IF THE RECENT MARKET RALLY IS TO
CONTINUE. THE GOOD NEWS IS THAT CORPORATE PROFIT EXPECTATIONS APPEARED TO
STABILIZE AS THE SECOND QUARTER WOUND DOWN. CURRENT EXPECTATIONS ARE FOR S&P 500
PROFIT COMPARISONS TO TURN POSITIVE IN THE FOURTH QUARTER OF 2009 AND FOR GROWTH
OF BETTER THAN 25% IN 2010 (WHICH WOULD STILL LEAVE PROFITS BELOW THEIR 2007
LEVEL). ALTHOUGH THE STOCK MARKET MAY HAVE TO TAKE A BREATHER AT SOME POINT TO
DIGEST RECENT GAINS, STOCKS COULD GENERATE CLOSE TO A DOUBLE-DIGIT RETURN OVER
THE COMING 12 MONTHS ON TOP OF RECENT GAINS, IF ECONOMIC AND CORPORATE TRENDS
DEVELOP AS WE EXPECT. MARKET VOLATILITY IS LIKELY TO REMAIN HIGH FOR SOME TIME,
HOWEVER.
2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999
Total Return 6 Mos. Year Year Year Year Year Year Year Year Year Year
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Wright Selected Blue Chip
Equities Fund (WSBC) 7.9% -39.8% 11.6% 3.8% 11.1% 15.7% 30.1% -17.0% -10.2% 10.8% 5.8%
Wright Major Blue Chip
Equities Fund (WMBC) -1.3% -34.9% 6.0% 11.6% 6.2% 12.4% 23.2% -24.5% -16.9% -12.5% 24.0%
Wright International Blue Chip
Equities Fund (WIBC) 9.2% -47.7% 5.5% 28.5% 21.1% 17.7% 32.0% -14.5% -24.2% -17.6% 34.3%
WRIGHT SELECTED BLUE CHIP EQUITIES FUND
The S&P MidCap 400 outperformed the S&P 500 in the first half of 2009 with a
smaller loss in the first quarter and a bigger gain in the second. After
outperforming the S&P MidCap 400 benchmark in the first quarter, the Wright
Selected Blue Chip Equities Fund (WSBC), which is a mid-cap blend fund, lagged
in the second, with a 17.2% return compared to the 18.8% return from the S&P
MidCaps for the quarter. WSBC's first-half return of 7.9% compared to 8.5% for
the MidCaps and 3.2% for the S&P 500. In the first quarter of 2009, the key
factor in WSBC's outperformance was its positioning in the financial sector,
i.e., its slight underweight in the worst-performing sector of the index and the
smaller loss of its financial holdings compared to those in the index. In the
second quarter, stock selection in the financial sector was the biggest
detractor from WSBC's relative performance as the Fund's holdings, after
performing better in Q1, staged less of a recovery compared to the benchmark in
Q2. Stock selection in energy and consumer discretionary was also negative in
Q2, while all other sectors contributed positively to performance. WSBC's
shortfall compared to the benchmark for all of the first half reflects lagging
performance in health care and consumer discretionary selections for the first
and second quarters combined. Western Digital +37%, Health Management Associates
+91% and Energen +37% were among the most positive contributors to Fund
performance in Q2, while Axciom -26%, Raymond James -12% and Terra Industries
- -13% lagged. Western Digital +131%, Health Management +176% and Energen +37%
were also among the leaders in the first six months of the year, while JetBlue
- -40% and insurance companies Stancorp -31% and W. R. Berkley -30% lagged. In the
aggregate, WSBC companies have a lower forward P/E multiple than those in the
MidCap 400 with similar expected earnings growth. WSBC continues to be biased to
the larger companies in the index and its holdings have better historic earnings
growth, return on equity and cash growth than the index constituents. WIS
continues to advise diversity in investment portfolios as the best way to
navigate difficult economic times.
WRIGHT MAJOR BLUE CHIP EQUITIES FUND
The Wright Major Blue Equities Chip Fund (WMBC) is managed as a blend of the
large-cap growth and value stocks in the S&P 500 Composite, selected with a bias
toward the higher-quality issues in the index. The WMBC Fund lagged the S&P 500
in the first half of 2009, losing a bit more in the first quarter and not
rebounding as strongly in the second. For the second quarter of 2009, WMBC
returned 13.8% compared to 15.9% for the S&P 500. For the first six months of
the year, WMBC lost 1.3% compared to a 3.2% positive return for the benchmark.
In the first quarter of 2009, the main reason for WMBC's underperformance
compared to the benchmark was its relative overweight position in financial
stocks, which were the worst-performing group in the index for the period. The
overweight position in financials, which led the S&P 500 in Q2, was a plus for
the second quarter, but the Fund's financial holdings did not recover as much as
some of the lower-quality financial issues included in the S&P 500. As investors
took on more risk and were willing to buy lower-quality issues in the second
quarter, WMBC's high-quality stock selections in the technology and consumer
discretionary sectors also lagged S&P constituents in those groups. The
preference of investors for smaller stocks also worked against the Fund, which
is weighted toward the more substantial holdings in the index. On the plus side,
WMBC had a strong showing in its health care selections for the quarter. For the
entire first half, underperformance of stock selections in the technology,
financial and consumer discretionary sectors held back the Fund's performance
relative to the S&P 500. Looking at individual issues, in the second quarter
Apple +36%, Express Scripts +49% and Bank of America +94% were among the top
contributors to WMBC's performance, while Wal-Mart -6.5%, Gamestop -21% and
Apollo Group -24% lagged. For the first half, tech stocks such as IBM +25%,
Apple +67% and Oracle +21% were big contributors; the two biggest detractors
from performance were financial stocks Wells Fargo -16% and MetLife -14%. The
recovery in stocks since March was driven by rising P/E multiples. In our view,
the firm prospect of improving earnings growth will be necessary to take stocks
much higher. With its bias toward the higher-quality issues in the S&P 500 and
an attractive valuation, WMBC is well positioned to take advantage of an
environment in which fundamentals are more important than they were in Q2. At
mid-year 2009, WMBC holdings in the aggregate were priced at lower current and
forward P/E multiples than the S&P 500 despite better historic earnings growth
and similar forecast earnings growth.
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND
After lagging the S&P 500 in 2008 and the first quarter of 2009, the MSCI World
ex U.S. index significantly outperformed the S&P 500 in the second quarter of
2009, both in local currencies (+17%) and with an extra boost from depreciation
of the dollar. The Wright International Blue Chip Equities Fund (WIBC) had a
bigger loss than the MSCI benchmark in Q1, but essentially made up the loss in
Q2 with a 28.5% return compared to 25.9% for the benchmark. For the first half
of 2009, WIBC returned 9.2% compared to the MSCI index's 9.3%. In the first
quarter of 2009, WIBC's relative performance was hurt by technical factors
stemming from foreign markets being closed on December 31, 2008 while U.S.
markets were open. In addition, a weak performance in financial stocks hurt the
Fund's performance in Q1. In the second quarter, however, the Fund was helped by
being overweight in financials as they recovered around the globe. Of the five
top contributors to the Fund's outperformance in Q2, four were financial stocks:
Barclays, Swiss Re, Banco Santander and Toronto Dominion Bank. In addition, the
Fund was also overweight in cyclical sectors in Q2, with good relative showings
coming from materials and consumer discretionary stocks in addition to
financials. Lagging stocks in the quarter included Fanuc, Mazda Motor, Nintendo
and Roche Holdings. During the first half of the year, WIBC increased its
holdings in European and Latin American companies that sell to Asian markets and
also added to Chinese and Indian holdings to respond to signs of improving
growth in Asia. In addition to following strict quality standards in selecting
its holdings, WIBC offers attractive value. In the aggregate, its holdings are
priced at significant discounts to the MSCI World ex U.S. index in terms of
current and forward price/earnings, price/cash and price/book value ratios. We
continue to see the inclusion of international stocks as likely to enhance
returns in diversified investment portfolios.
FIXED-INCOME FUNDS
THE BARCLAYS CAPITAL U.S. AGGREGATE BOND INDEX RETURNED 1.8% IN THE SECOND
QUARTER, BRINGING ITS YEAR-TO-DATE RETURN TO 1.9%. TREASURY YIELDS ROSE IN BOTH
THE FIRST AND SECOND QUARTERS OF 2009 BUT INVESTORS IN DIVERSIFIED FIXED-INCOME
PORTFOLIOS BENEFITTED FROM SPREADS TIGHTENING ON NON-TREASURY SECTORS,
PARTICULARLY IN THE SECOND QUARTER. THE IMPROVED CONFIDENCE THAT THESE MARKET
MOVES REFLECTED WAS BASED ON INDICATIONS OF IMPROVEMENT IN THE HEALTH AND
LIQUIDITY OF THE FINANCIAL SYSTEM AS WELL AS ECONOMIC DATA SUGGESTING THAT THE
RATE OF DECLINE IN THE ECONOMY WAS SLOWING. THE FED KEPT ITS FED FUNDS TARGET
RATE NEAR ZERO, THOUGH IT DID NOTE AFTER ITS JUNE POLICY MEETING THAT THE PACE
OF ECONOMIC CONTRACTION WAS SLOWING. THE LOW FED FUNDS RATE ACTED AS AN ANCHOR
AT THE SHORT END OF THE YIELD CURVE, BUT AT THE LONGER END, A NUMBER OF FACTORS
COMBINED TO SEND RATES HIGHER. INFLATION EXPECTATIONS (THE DIFFERENCE BETWEEN
NOMINAL TREASURY YIELDS AND TIPS YIELDS) ROSE, ALTHOUGH CURRENTLY INFLATION
REMAINS UNDER CONTROL. SOME OF THE SELL-OFF OF LONGER TREASURYS WAS A RESULT OF
INVESTORS BECOMING MORE WILLING TO TAKE ON RISK AS CONFIDENCE IN THE ECONOMY AND
THE FINANCIAL SYSTEM IMPROVED. TREASURY YIELDS ALSO ROSE AS A RESULT OF
INVESTORS' ANTICIPATION OF MASSIVE NEW TREASURY BOND ISSUANCE TO FUND BALLOONING
DEFICITS. FED PURCHASES OF TREASURY BONDS ARE LIKELY TO PROVE A RELATIVELY
MODEST OFFSET TO THIS NEW SUPPLY.
IN THE FIRST HALF OF 2009, THE YIELD ON THE 10-YEAR TREASURY ROSE ABOUT 130
BASIS POINTS TO 3.5% AT MID YEAR AFTER BRUSHING UP AGAINST 4.0%. THREE-MONTH
RATES WERE ABOUT 0.2% AS THE SECOND QUARTER ENDED, WHILE TWO-YEAR YIELDS WERE AT
1.1%, UP ABOUT 35 BASIS POINTS SINCE THE END OF 2008. (THIS STEEPENING OF THE
YIELD CURVE IS GOOD FOR THE PROFITABILITY OF THE FINANCIAL SECTOR, BUT IT WORKS
AGAINST THE FED'S EFFORTS TO KEEP MORTGAGE RATES LOW.) THE BARCLAYS AGGREGATE'S
POSITIVE RETURN IN THE SECOND QUARTER CAME DESPITE LOSSES FROM TREASURY BONDS.
TREASURYS LOST 3.0% IN THE QUARTER AND 4.3% YEAR TO DATE, WITH THE BIGGEST
LOSSES AT THE LONG END OF THE YIELD CURVE - E.G., MORE THAN 9% FOR TREASURYS
LONGER THAN 20 YEARS IN THE SECOND QUARTER ALONE. RETURNS FROM GOVERNMENT AGENCY
ISSUES AND MORTGAGE-BACKED ISSUES WERE MODESTLY POSITIVE. THE MAJOR CONTRIBUTION
TO THE AGGREGATE'S RETURN IN THE FIRST HALF OF 2009 CAME FROM CORPORATE BONDS
(8.3% FOR INVESTMENT-GRADE CORPORATES, ALL DUE TO THE SECOND QUARTER'S 10%
RETURN), ASSET-BACKED SECURITIES (7.6% IN Q2, 16% FOR THE HALF) AND COMMERCIAL
MORTGAGES (12% FOR THE QUARTER, 10% FOR THE HALF). THIS MIX OF RETURNS REFLECTED
THE IMPROVED CONFIDENCE THAT SENT STOCKS HIGHER IN THE SECOND QUARTER OF 2009;
IT ALSO REFLECTS HOW OVERSOLD THESE SPREAD SECTORS HAD BECOME IN 2008.
THE FED HAS INDICATED THAT IT WILL KEEP INTEREST RATES LOW "FOR AN EXTENDED
PERIOD" IN ORDER TO STIMULATE GROWTH. ALSO WORKING TO KEEP INTEREST RATES LOW IN
THE SHORT TERM ARE LOW RATES OF CAPACITY UTILIZATION AROUND THE GLOBE AND
MODERATE WAGE INCREASES. THIS WILL SERVE TO OFFSET THE INFLATIONARY IMPACT OF
LIQUIDITY BEING PUMPED INTO THE FINANCIAL SYSTEM IN THE SHORT RUN. ON THE OTHER
HAND, THE TREASURY'S NEED TO ISSUE LARGE AMOUNTS OF DEBT TO FUND THE STIMULUS
AND RESCUE PACKAGES WILL BE PUTTING UPWARD PRESSURE ON RATES. WE EXPECT THAT
TREASURY YIELDS WON'T BE MUCH DIFFERENT AT THE END OF 2009 THAN THEY ARE TODAY,
BUT RATES COULD EDGE HIGHER AS 2010 PROGRESSES. WE EXPECT SPREAD TIGHTENING ON
NON-TREASURY SECTORS TO OFFSET THE EFFECTS OF MODESTLY HIGHER TREASURY YIELDS,
ALLOWING THE BARCLAYS CAPITAL AGGREGATE INDEX TO PROVIDE A POSITIVE RETURN THAT
EXCEEDS THE INFLATION RATE OVER THE COMING 12 MONTHS. WE CONTINUE TO RECOMMEND
HOLDING A MIX OF ASSET CLASSES IN LONG-TERM INVESTMENT PORTFOLIOS.
2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999
Total Return 6 Mos. Year Year Year Year Year Year Year Year Year Year
-------------------------------------------------------------------------------------------------------------------
Wright Total Return Bond Fund
(WTRB) 5.3% 1.7% 5.6% 3.3% 1.5% 3.5% 3.3% 9.0% 5.0% 10.6% -3.9%
Wright Current Income Fund
(WCIF) 3.1% 6.1% 5.8% 3.9% 1.8% 3.3% 1.7% 7.7% 7.2% 10.3% 0.5%
WRIGHT TOTAL RETURN BOND FUND
The U.S. bond market had a modestly positive return in the first half of 2009 as
the Barclays Capital U.S. Aggregate bond index returned 1.9%, behind the S&P
500's 3.2%. The Wright Total Return Bond Fund (WTRB), a diversified bond fund,
was ahead of the Barclays Capital Aggregate in both the first and second
quarters of 2009. For the second quarter, WTRB returned 4.6% compared to 1.8%
for the Barclays U.S. Aggregate index. For the half, WTRB returned 5.3% compared
to 1.9% for the Barclays benchmark. For June, the WTRB had a yield of 4.9%
calculated according to SEC guidelines. Dividends paid by this Fund may be more
or less than implied by this yield. WTRB's duration position had a positive
impact on performance in the first half of 2009. The low level of Treasury
yields as the year began prompted a move to a slightly short duration compared
to the Barclays benchmark in anticipation of a move to higher yields, which did
take place. In the first quarter, the yield on the 10-year Treasury bond rose by
45 basis points, and in the second it moved higher by more than 80 basis points.
At the end of June, the Fund's duration was still slightly short compared to the
benchmark. For some time, WTRB has been positioned to benefit from a steepening
yield curve and this also worked to the Fund's advantage in both the first and
second quarters of 2009. Being overweight in mortgage-backed and asset-backed
securities helped Fund performance during the first quarter since both of these
sectors performed better than the Barclays Aggregate index and also outperformed
Treasury bonds for the period. In the second quarter, overweight positions in
corporate bonds, commercial mortgages, and asset-backed securities gave a
significant boost to performance as these sectors significantly outperformed the
Treasury and Agency sectors, where WTRB was underweighted. At the end of the
second quarter, WTRB was essentially neutral in mortgage-backed securities
compared to the index, but remained overweight in corporate bonds, commercial
mortgage-backed securities and asset-backed securities in anticipation that
further spread tightening in these sectors will be a major source of return in
the near term.
WRIGHT CURRENT INCOME FUND
In the first half of 2009, the mortgage-backed sector of the bond market
returned 2.9%, outperforming the Barclays Capital U.S. Aggregate bond index
(1.9%). The Wright Current Income Fund (WCIF) is managed to be primarily
invested in GNMA issues (mortgage-based securities, known as Ginnie Maes,
guaranteed by the full faith and credit of the U.S. government) and other
mortgage-based securities. WCIF is actively managed to maximize income and
minimize principal fluctuation. In the first quarter of 2009, WCIF performed in
line with the 2.1% return for the Barclays Capital GNMA bond index. In Q2, the
Fund outperformed with a 1.1% return compared to 0.3% for the benchmark. For the
first half of 2009, WCIF returned 3.1% compared to 2.4% for the Barclays GNMA
index. In June, WCIF had a yield of 4.7% as calculated by SEC guidelines.
Dividends paid by this Fund may be more or less than implied by this yield. In
addition to its holdings in Ginnie Maes (about 58% of assets at June 30), WCIF
also held mortgage-backed securities backed by Fannie Mae (FNMA) and Freddie Mac
(FHLMC). FNMA and FHLMC issues performed in line with GNMAs in the first
quarter, but outperformed in the second, contributing to the Fund's positive
showing in that period. The Fund also had a small position (about 3%) in
non-agency mortgages. The Fund's selection of mortgages in the aggregate had a
longer duration than the Barclays benchmark in the first and second quarters.
The Fund also was overweight in higher coupon issues in order to generate more
income. The Fund's holdings of higher coupon, well-seasoned bonds contributed to
the Fund's having less negative convexity than the Barclays index, which
resulted in a more stable duration and benefited performance in the first half,
a period of volatile interest rates.
THE VIEWS EXPRESSED THROUGHOUT THIS REPORT ARE THOSE OF THE PORTFOLIO
MANAGERS AND ARE CURRENT ONLY THROUGH THE END OF THE PERIOD OF THE REPORT AS
STATED ON THE COVER. THESE VIEWS ARE SUBJECT TO CHANGE AT ANY TIME BASED
UPON MARKET OR OTHER CONDITIONS, AND THE INVESTMENT ADVISER DISCLAIMS ANY
RESPONSIBILITY TO UPDATE SUCH VIEWS. THESE VIEWS MAY NOT BE RELIED ON AS
INVESTMENT ADVICE AND, BECAUSE INVESTMENT DECISIONS FOR A FUND ARE BASED ON
MANY FACTORS, MAY NOT BE RELIED ON AS AN INDICATION OF TRADING INTENT ON
BEHALF OF ANY OF THE WRIGHT MANAGED INVESTMENT FUNDS.
U.S. SECURITIES MARKETS -------------------------------------------------------
The Dow Jones Industrial Average chart shows the point changes in the average
which consists of 30 major NYSE industrial companies and is a price-weighted
arithmetic average, with the divisor adjusted for stock splits. The yield
chart shows the basis point changes in the U.S. Treasury bond which is the
benchmark U.S. Treasury bond with a maturity of 10 years.
The following plotting points are used for comparison in the mountain charts.
Date Dow Jones U.S. 10 Year
Industrial Average Treasury Bond Yield
12/31/99 11,497.12 6.44%
12/31/00 10,786.85 5.11%
12/31/01 10,021.50 5.00%
12/31/02 8,341.63 3.82%
12/31/03 10,453.92 4.25%
12/31/04 10,783.01 4.22%
12/31/05 10,717.50 4.39%
12/31/06 12,463.15 4.71%
12/31/07 13,264.82 4.03%
12/31/08 8,776.39 2.24%
06/30/09 8,447.00 3.53%
FUND EXPENSES
- -------------------------------------------------------------------------------
EXAMPLE:
As a shareholder of a fund, you incur two types of costs: (1) transaction costs,
including sales charges (loads) on purchases and redemption fees (if
applicable); and (2) ongoing costs including management fees; distribution or
service fees; and other fund expenses. This example is intended to help you
understand your ongoing costs (in dollars) of investing in a fund and to compare
these costs with the ongoing costs of investing in other mutual funds. The
example is based on an investment of $1,000 invested at the beginning of the
period and held for the entire period (January 1, 2009 - June 30, 2009).
ACTUAL EXPENSES:
The first line of the tables shown on the following page 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 that
you paid over the period. Simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the
result by the number in the first line under the heading entitled "Expenses Paid
During Period" to estimate the expenses you paid on your account during this
period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES:
The second line of the tables provides information about hypothetical account
values and hypothetical expenses based on the actual Fund expense ratio and an
assumed rate of return of 5% per year (before expenses), which is not the actual
return of the Fund. The hypothetical account values and expenses may not be used
to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in your Fund and other funds. To do so, compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of the
other funds.
Please note that the expenses shown in the tables are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads) or redemption fees (if payable). Therefore, the second line of
the tables is useful in comparing ongoing costs only, and will not help you
determine the relative total costs of owning different funds. In addition, if
these transactional costs were included, your costs would be higher.
WRIGHT SELECTED BLUE CHIP EQUITIES FUND
Expenses Paid
Beginning Ending During Period*
Account Value Account Value (1/1/09-
(1/1/09) (6/30/09) 6/30/09)
- -------------------------------------------------------------------
Actual Fund Shares $1,000.00 $1,079.20 $6.70
- -------------------------------------------------------------------
Hypothetical (5% return per year before expenses)
Fund Shares $1,000.00 $1,018.30 $6.51
*Expenses are equal to the Fund's annualized expense ratio of 1.30% multiplied
by the average account value over the period, multiplied by 181/365 (to
reflect the one-half year period). The example assumes that the $1,000 was
invested at the net asset value per share determined at the close of business
on December 31, 2008.
WRIGHT MAJOR BLUE CHIP EQUITIES FUND
Expenses Paid
Beginning Ending During Period*
Account Value Account Value (1/1/09-
(1/1/09) (6/30/09) 6/30/09)
- -------------------------------------------------------------------
Actual Fund Shares $1,000.00 $987.40 $6.41
- -------------------------------------------------------------------
Hypothetical (5% return per year before expenses)
Fund Shares $1,000.00 $1,018.30 $6.51
*Expenses are equal to the Fund's annualized expense ratio of 1.30% multiplied
by the average account value over the period, multiplied by 181/365 (to
reflect the one-half year period). The example assumes that the $1,000 was
invested at the net asset value per share determined at the close of business
on December 31, 2008.
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND
Expenses Paid
Beginning Ending During Period*
Account Value Account Value (1/1/09-
(1/1/09) (6/30/09) 6/30/09)
- -------------------------------------------------------------------
Actual Fund Shares $1,000.00 $1,091.60 $8.30
- -------------------------------------------------------------------
Hypothetical (5% return per year before expenses)
Fund Shares $1,000.00 $1,016.90 $8.00
*Expenses are equal to the Fund's annualized expense ratio of 1.60% multiplied
by the average account value over the period, multiplied by 181/365 (to
reflect the one-half year period). The example assumes that the $1,000 was
invested at the net asset value per share determined at the close of business
on December 31, 2008.
WRIGHT TOTAL RETURN BOND FUND
Expenses Paid
Beginning Ending During Period*
Account Value Account Value (1/1/09-
(1/1/09) (6/30/09) 6/30/09)
- -------------------------------------------------------------------
Actual Fund Shares $1,000.00 $1,052.90 $3.56**
- -------------------------------------------------------------------
Hypothetical (5% return per year before expenses)
Fund Shares $1,000.00 $1,021.30 $3.51**
* Expenses are equal to the Fund's annualized expense ratio of 0.70%
multiplied by the average account value over the period, multiplied by
181/365 (to reflect the one-half year period). The example assumes that the
$1,000 was invested at the net asset value per share determined at the close
of business on December 31, 2008.
**Absent a voluntary expense limitation by the investment adviser and/or
principal underwriter of the fund, expenses would be higher.
WRIGHT CURRENT INCOME FUND
Expenses Paid
Beginning Ending During Period*
Account Value Account Value (1/1/09-
(1/1/09) (6/30/09) 6/30/09)
- -------------------------------------------------------------------
Actual Fund Shares $1,000.00 $1,031.40 $4.68**
- -------------------------------------------------------------------
Hypothetical (5% return per year before expenses)
Fund Shares $1,000.00 $1,020.20 $4.66**
* Expenses are equal to the Fund's annualized expense ratio of 0.93%
multiplied by the average account value over the period, multiplied by
181/365 (to reflect the one-half year period). The example assumes that the
$1,000 was invested at the net asset value per share determined at the close
of business on December 31, 2008.
**Absent a voluntary expense limitation by the investment adviser and/or
principal underwriter of the fund, expenses would be higher.
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WSBC)
- ------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS - AS OF JUNE 30, 2009 (UNAUDITED)
Shares Value
EQUITY INTERESTS - 100.8%
AEROSPACE & DEFENSE -- 0.4%
Alliant Techsystems, Inc. * 665 $ 54,769
------------
AUTOMOBILES & COMPONENTS -- 0.9%
Advance Auto Parts, Inc. 2,750 $ 114,098
------------
BANKS -- 3.0%
Bank of Hawaii Corp. 3,260 $ 116,806
Commerce Bancshares, Inc. 2,079 66,175
Cullen/Frost Bankers, Inc. 715 32,976
SVB Financial Group * 6,075 165,361
Wilmington Trust Corp. 1,950 26,637
------------
$ 407,955
------------
CAPITAL GOODS -- 4.0%
AGCO Corp. * 6,630 $ 192,734
SPX Corp. 4,420 216,448
Thomas & Betts Corp. * 4,505 130,014
------------
$ 539,196
------------
CHEMICALS -- 0.3%
Cytec Industries, Inc. 2,145 $ 39,940
------------
COMMERCIAL SERVICES & SUPPLIES -- 4.4%
Charles River Laboratories
International * 3,475 $ 117,281
FirstMerit Corp. 2 34
Global Payments, Inc. 4,385 164,262
Harsco Corp. 2,235 63,251
Manpower, Inc. 3,770 159,622
Navigant Consulting, Inc. * 7,070 91,344
------------
$ 595,794
------------
COMMUNICATIONS EQUIPMENT -- 0.4%
CommScope, Inc. * 2,210 $ 58,035
------------
COMPUTERS & PERIPHERALS -- 3.5%
Jack Henry & Associates, Inc. 4,530 $ 93,997
Western Digital Corp. * 14,120 374,180
------------
$ 468,177
------------
CONSUMER DURABLES & APPAREL -- 1.0%
Herman Miller, Inc. 9,125 $ 139,978
------------
CONSUMER PRODUCTS -- 1.6%
John Wiley & Sons, Inc. - Class A 1,480 $ 49,210
Priceline.com, Inc. * 1,505 167,883
------------
$ 217,093
------------
DIVERSIFIED FINANCIALS -- 3.3%
Eaton Vance Corp. 4,495 $ 120,241
Raymond James Financial, Inc. 9,862 169,725
SEI Investments Co. 8,810 158,933
------------
$ 448,899
------------
EDUCATION -- 1.7%
Career Education Corp. * 1,910 $ 47,540
DeVry, Inc. 1,690 84,567
ITT Educational Services, Inc. * 980 98,647
------------
$ 230,754
------------
ELECTRONIC EQUIPMENT & INSTRUMENTS-- 8.1%
Ametek, Inc. 3,395 $ 117,399
Arrow Electronics, Inc. * 7,820 166,097
Avnet, Inc. * 7,845 164,980
Hubbell, Inc. 4,465 143,148
Ingram Micro, Inc. - Class A* 3,140 54,950
Lincoln Electric Holdings, Inc. 2,475 89,199
Pentair, Inc. 4,910 125,794
Synopsys, Inc. * 2,790 54,433
Tech Data Corp. * 2,260 73,925
Vishay Intertechnology, Inc. * 14,725 99,983
------------
$ 1,089,908
------------
ENERGY -- 10.1%
Cimarex Energy Co. 3,790 $ 107,408
Cliffs Natural Resources, Inc. 1,895 46,371
Denbury Resources, Inc. * 7,945 117,030
Energen Corp. 6,770 270,123
FMC Technologies, Inc. * 7,190 270,200
Forest Oil Corp. * 7,140 106,529
Helmerich & Payne, Inc. 3,290 101,562
Patterson-UTI Energy, Inc. 5,895 75,810
Superior Energy Services, Inc. * 5,970 103,102
Tidewater, Inc. 2,370 101,602
UGI Corp. 2,590 66,019
------------
$ 1,365,756
------------
FOOD, BEVERAGE & TOBACCO -- 2.0%
Corn Products International, Inc. 2,315 $ 62,019
PepsiAmericas, Inc. 4,500 120,645
Ralcorp Holdings, Inc. * 1,330 81,023
------------
$ 263,687
------------
HEALTH CARE EQUIPMENT & SERVICES-- 6.7%
Community Health Systems, Inc. * 3,345 $ 84,461
Health Management Associates,
Inc. - Class A* 17,065 84,301
LifePoint Hospitals, Inc. * 7,645 200,681
Lincare Holdings, Inc. * 11,930 280,594
Service Corp. International 6,810 37,319
STERIS Corp. 3,955 103,147
WellCare Health Plans, Inc. * 6,335 117,134
------------
$ 907,637
------------
HOUSEHOLD & PERSONAL PRODUCTS -- 2.5%
Church & Dwight Co., Inc. 2,535 $ 137,676
NetFlix, Inc. * 2,645 109,344
Tupperware Brands Corp. 3,455 89,899
------------
$ 336,919
------------
INSURANCE -- 8.3%
American Financial Group, Inc. 5,195 $ 112,108
Everest Re Group, Ltd. 1,735 124,174
Hanover Insurance Group, Inc. 800 30,488
HCC Insurance Holdings, Inc. 12,450 298,925
Protective Life Corp. 3,715 42,500
Reinsurance Group of America, Inc. 2,485 86,751
StanCorp Financial Group, Inc. 6,215 178,246
W.R. Berkley Corp. 11,237 241,258
------------
$ 1,114,450
------------
MACHINERY -- 0.8%
IDEX Corp. 1,415 $ 34,766
Wabtec Corp. 2,310 74,313
------------
$ 109,079
------------
MATERIALS -- 9.2%
Airgas, Inc. 3,330 $ 134,965
Carpenter Technology Corp. 1,255 26,116
Crane Co. 3,010 67,153
FMC Corp. 1,635 77,335
Joy Global, Inc. 3,140 112,161
Kennametal, Inc. 950 18,221
Lubrizol Corp. 3,570 168,897
Matthews International Corp. - Class A 1,755 54,616
Minerals Technologies, Inc. 1,345 48,447
Reliance Steel & Aluminum Co. 2,720 104,421
Sonoco Products Co. 3,955 94,722
Steel Dynamics, Inc. 5,620 82,783
Terra Industries, Inc. 4,270 103,419
Timken Co. 5,935 101,370
Worthington Industries, Inc. 2,935 37,539
------------
$ 1,232,165
------------
PHARMACEUTICALS & BIOTECHNOLOGY -- 3.0%
Endo Pharmaceuticals Holdings, Inc. * 7,235 $ 129,651
Omnicare, Inc. 1,780 45,853
Perrigo Co. 6,400 177,792
Pharmaceutical Product Development, Inc. 2,360 54,799
------------
$ 408,095
------------
REAL ESTATE -- 3.5%
Federal Realty Investment Trust (REIT) 1,310 $ 67,491
Jones Lang LaSalle, Inc. 2,245 73,479
NVR, Inc. * 305 153,229
Omega Healthcare Investors, Inc. (REIT) 3,540 54,941
Toll Brothers, Inc. * 3,770 63,977
UDR, Inc. 5,366 55,430
------------
$ 468,547
------------
RETAILING -- 8.4%
Aeropostale, Inc. * 3,197 $ 109,561
BJ's Wholesale Club, Inc. * 3,940 126,986
Dick's Sporting Goods, Inc. * 4,375 75,250
Dollar Tree, Inc. * 6,715 282,701
Guess?, Inc. 1,480 38,154
Phillips-Van Heusen Corp. 3,140 90,087
Regis Corp. 7,865 136,930
Rent-A-Center, Inc. * 2,465 43,951
Ross Stores, Inc. 5,720 220,792
------------
$ 1,124,412
------------
SOFTWARE & SERVICES -- 7.2%
Acxiom Corp. * 10,700 $ 94,481
Alliance Data Systems Corp. * 3,360 138,398
Ansys, Inc. * 4,715 146,919
DST Systems, Inc. * 1,190 43,971
F5 Networks, Inc. * 2,720 94,085
Mantech International Corp. - Class A* 1,645 70,801
McAfee, Inc. * 3,495 147,454
Sybase, Inc. * 7,385 231,446
------------
$ 967,555
------------
TELECOMMUNICATION SERVICES -- 0.5%
Syniverse Holdings, Inc. * 3,770 $ 60,433
------------
TRANSPORTATION -- 2.2%
AirTran Holdings, Inc. * 26,005 $ 160,971
Con-way, Inc. 1,300 45,903
JetBlue Airways Corp. * 20,835 88,965
------------
$ 295,839
------------
UTILITIES -- 3.8%
MDU Resources Group, Inc. 14,503 $ 275,122
Oneok, Inc. 8,080 238,279
------------
$ 513,401
------------
TOTAL EQUITY INTERESTS - 100.8%
(identified cost, $15,740,287) $ 13,572,571
OTHER ASSETS, LESS LIABILITIES - (0.8)% (107,043)
------------
NET ASSETS - 100.0% $ 13,465,528
============
REIT - Real Estate Investment Trust
* Non-income-producing security.
See notes to financial statements
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WSBC)
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
ASSETS:
Investments, at value
(identified cost $15,740,287) (Note 1A) $ 13,572,571
Cash 825
Receivable for fund shares sold 1,033
Dividends receivable 13,155
Prepaid expenses 20,779
------------
Total assets $ 13,608,363
------------
LIABILITIES:
Demand note payable (Note 8) $ 123,000
Payable for fund shares reacquired 3,440
Accrued expenses and other liabilities 16,395
------------
Total liabilities $ 142,835
------------
NET ASSETS $ 13,465,528
============
NET ASSETS CONSIST OF:
Paid-in capital $ 17,312,400
Accumulated net realized loss on investments (1,690,741)
Accumulated undistributed net
investment income 11,585
Unrealized depreciation of investments (2,167,716)
------------
Net assets applicable to outstanding shares $ 13,465,528
============
SHARES OF BENEFICIAL INTEREST OUTSTANDING 2,059,539
============
NET ASSET VALUE, OFFERING PRICE,
AND REDEMPTION PRICE PER SHARE
OF BENEFICIAL INTEREST $ 6.54
============
See notes to financial statements
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
INVESTMENT INCOME (Note 1C)
Dividend income $ 86,286
Other Income 7,617
------------
Total investment income $ 93,903
------------
Expenses -
Investment adviser fee (Note 3) $ 37,877
Administrator fee (Note 3) 7,575
Compensation of Trustees who are not employees
of the investment adviser or administrator 6,427
Custodian fee (Note 1F) 29,376
Distribution expenses (Note 4) 15,782
Transfer and dividend disbursing agent fees 12,711
Printing 1,617
Shareholder communications 2,369
Audit services 16,040
Legal services 1,500
Registration costs 8,386
Miscellaneous 2,839
------------
Total expenses $ 142,499
------------
Deduct -
Waiver and/or reimbursement by the principal
underwriter and/or investment adviser
(Note 3 and 4) $ (60,167)
Reduction of custodian fee (Note 1F) (14)
------------
Total deductions $ (60,181)
------------
Net expenses $ 82,318
------------
Net investment income $ 11,585
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investment transactions $ (270,852)
Net change in unrealized appreciation
(depreciation) on investments 1,233,168
------------
Net realized and unrealized gain on
investments $ 962,316
------------
Net increase in net assets from operations $ 973,901
============
See notes to financial statements
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WSBC)
- -------------------------------------------------------------------------------
Six Months Ended Year Ended,
STATEMENTS OF CHANGES IN NET ASSETS June 30, 2009 December 31, 2008
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
INCREASE (DECREASE) IN NET ASSETS:
From operations -
Net investment income (loss) $ 11,585 $ (27,533)
Net realized loss on investment transactions (270,852) (1,371,940)
Net change in unrealized appreciation (depreciation) on investments 1,233,168 (6,810,349)
-------------- --------------
Net increase (decrease) in net assets from operations $ 973,901 $ (8,209,822)
-------------- --------------
Distributions to shareholders (Note 2) -
From net realized gains $ -- $ (1,863,251)
-------------- --------------
Total distributions $ -- $ (1,863,251)
-------------- --------------
Net decrease in net assets from fund share transactions (Note 6) $ (872,181) $ (486,111)
-------------- --------------
Net increase (decrease) in net assets $ 101,720 $(10,559,184)
NET ASSETS:
At beginning of period 13,363,808 23,922,992
-------------- --------------
At end of period $ 13,465,528 $ 13,363,808
============== ==============
ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME
INCLUDED IN NET ASSETS AT END OF PERIOD $ 11,585 $ --
============== ==============
See notes to financial statements
WRIGHT SELECTED BLUE CHIP EQUITIES FUND (WSBC)
- ------------------------------------------------------------------------------
Six Months
Ended June 30 Year Ended December 31,
- -----------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 2009 (3) 2008(3) 2007(3) 2006(3) 2005 2004
- -----------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Net asset value, beginning of period $ 6.060 $ 11.100 $ 12.270 $ 13.030 $ 13.226 $ 11.870
--------- --------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income (loss(1) $ 0.005 $ (0.013) $ (0.013) $ (0.034) $ (0.053) $ (0.028)
Net realized and unrealized gain (loss) 0.475 (4.121) 1.340 0.529 1.476 1.884
--------- --------- --------- --------- --------- ---------
Total income (loss) from
investment operations $ 0.480 $ (4.134) $ 1.327 $ 0.495 $ 1.423 $ 1.856
--------- --------- --------- --------- --------- ---------
Less distributions:
From net investment income $ - $ - $ (0.016) $ - $ - $ -
From net realized gains - (0.906) (2.481) (1.255) (1.619) (0.500)
--------- --------- --------- --------- --------- ---------
Total distributions $ - $ (0.906) $ (2.497) $ (1.255) $ (1.619) $ (0.500)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 6.540 $ 6.060 $ 11.100 $ 12.270 $ 13.030 $ 13.226
========= ========= ========= ========= ========= =========
Total Return(2) 7.92%(5) (39.81)% 11.59% 3.77% 11.09% 15.73%
========= ========= ========= ========= ========= =========
Ratios/Supplemental Data(1):
Net assets, end of period (000 omitted) $ 13,466 $ 13,364 $ 23,923 $ 38,352 $ 47,652 $ 43,498
Ratios (As a percentage of average daily net assets):
Net expenses 1.30%(4) 1.26% 1.26% 1.26% 1.27% 1.26%
Net expenses after custodian fee reduction 1.30%(4) 1.25% 1.25% 1.25% 1.25% 1.25%
Net investment income (loss) 0.18%(4) (0.15)% (0.10)% (0.27)% (0.18)% (0.23)%
Portfolio turnover rate 13%(5) 72% 67% 66% 110% 69%
- ---------------------------------------------------------------------------------------------------------------------------------
(1) For the six months ended June 30, 2009 and for the years ended December 31,
2008, 2007, 2006, 2005 and 2004, the operating expenses of the Fund were
reduced by a waiver of fees and/or an allocation of expenses to the
principal underwriter and/or investment adviser. Had such action not been
undertaken, net investment loss per share and the ratios would have been as
follows:
2009 2008 2007 2006 2005 2004
- ----------------------------------------------------------------------------------------------------------------------------------
Net investment loss per share $ (0.023) $ (0.068) $ (0.064) $ (0.058) $ (0.111) $ (0.050)
========= ========= ========= ========= ========= =========
Ratios (As a percentage of average daily net assets):
Expenses 2.25%(4) 1.90% 1.66% 1.46% 1.45% 1.44%
========= ========= ========= ========= ========= =========
Expenses after custodian fee reduction 2.25%(4) 1.89% 1.66% 1.44% 1.43% 1.43%
========= ========= ========= ========= ========= =========
Net investment loss (0.77)%(4) (0.79)% (0.51)% (0.46)% (0.38)% (0.41)%
========= ========= ========= ========= ========= =========
- ---------------------------------------------------------------------------------------------------------------------------------
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the reinvestment date.
(3) Certain per share amounts are based on average shares outstanding.
(4) Annualized.
(5) Not annualized.
See notes to financial statements
WRIGHT MAJOR BLUE CHIP EQUITIES FUND (WMBC)
- ------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS - AS OF JUNE 30, 2009 (UNAUDITED)
Shares Value
EQUITY INTERESTS - 99.8%
AEROSPACE -- 2.8%
General Dynamics Corp. 5,295 $ 293,290
Goodrich Corp. 1,455 72,707
Honeywell International, Inc. 6,400 200,960
Northrop Grumman Corp. 5,250 239,820
Raytheon Co. 4,010 178,164
------------
$ 984,941
------------
AUTOMOBILES & COMPONENTS -- 0.3%
Cooper Industries, Ltd. - Class A 3,420 $ 106,191
------------
BANKS -- 4.3%
Bank of America Corp. 35,915 $ 474,078
Bank of New York Mellon Corp. 12,270 359,634
Hudson City Bancorp, Inc. 15,490 205,862
M&T Bank Corp. 2,705 137,766
Wells Fargo & Co. 12,610 305,918
------------
$ 1,483,258
------------
CAPITAL GOODS -- 3.8%
Caterpillar, Inc. 4,725 $ 156,114
General Electric Co. 11,970 140,288
Illinois Tool Works, Inc. 3,495 130,503
Lockheed Martin Corp. 8,860 714,559
Parker Hannifin Corp. 4,435 190,528
------------
$ 1,331,992
------------
COMMERCIAL SERVICES & SUPPLIES -- 0.2%
RR Donnelley & Sons Co. 5,380 $ 62,516
------------
COMMUNICATIONS EQUIPMENT -- 2.2%
Cisco Systems, Inc. * 14,490 $ 270,093
Harris Corp. 8,460 239,926
L-3 Communications Holdings, Inc. 3,595 249,421
------------
$ 759,440
------------
COMPUTERS & PERIPHERALS -- 10.0%
Affiliated Computer Services,
Inc. - Class A* 4,900 $ 217,658
Apple, Inc. * 4,590 653,754
Hewlett-Packard Co. 34,490 1,333,038
International Business Machines Corp. 12,330 1,287,499
------------
$ 3,491,949
------------
CONSTRUCTION & ENGINEERING -- 0.7%
Fluor Corp. 4,700 $ 241,063
------------
DIVERSIFIED FINANCIALS -- 4.6%
American Express Co. 8,855 $ 205,790
Ameriprise Financial, Inc. 2,760 66,985
Capital One Financial Corp. 8,275 181,057
Discover Financial Services 19,325 198,468
Federated Investors, Inc. - Class B 7,060 170,075
Goldman Sachs Group, Inc. (The) 1,450 213,788
JP Morgan Chase & Co. 4,560 155,542
Morgan Stanley 2,790 79,543
PNC Financial Services Group, Inc. 8,305 322,317
------------
$ 1,593,565
------------
ELECTRONICS -- 0.6%
Altera Corp. 4,445 $ 72,364
Emerson Electric Co. 4,260 138,024
------------
$ 210,388
------------
ENERGY -- 13.2%
Anadarko Petroleum Corp. 6,205 $ 281,645
Chesapeake Energy Corp. 6,355 126,020
Chevron Corp. 17,685 1,171,631
ConocoPhillips Co. 7,720 324,703
ENSCO International, Inc. 1,980 69,043
Exxon Mobil Corp. 19,000 1,328,290
National Oilwell Varco, Inc. * 7,185 234,662
Noble Energy, Inc. 2,150 126,785
Occidental Petroleum Corp. 11,130 732,465
Questar Corp. 2,775 86,192
Tesoro Corp. 4,645 59,131
Valero Energy Corp. 3,325 56,159
------------
$ 4,596,726
------------
ENTERTAINMENT & LEISURE -- 0.9%
Hasbro, Inc. 3,585 $ 86,900
Walt Disney Co. (The) 10,090 235,400
------------
$ 322,300
------------
FOOD, BEVERAGE & TOBACCO -- 3.9%
Altria Group, Inc. 42,400 $ 694,936
Archer-Daniels-Midland Co. 8,305 222,325
Molson Coors Brewing Co. - Class B 4,370 184,982
Philip Morris International, Inc. 5,555 242,309
------------
$ 1,344,552
------------
HEALTH CARE EQUIPMENT & SERVICES-- 6.1%
Aetna, Inc. 4,645 $ 116,357
Baxter International, Inc. 3,265 172,915
Express Scripts, Inc. * 7,475 513,906
Humana, Inc. * 5,540 178,721
Laboratory Corp. of America Holdings * 2,465 167,102
Medtronic, Inc. 14,070 490,902
WellPoint, Inc. * 9,280 472,259
------------
$ 2,112,162
------------
HEAVY MACHINERY -- 0.3%
Dover Corp. 3,640 $ 120,448
------------
HOTELS, RESTAURANTS & LEISURE -- 2.3%
McDonald's Corp. 14,155 $ 813,771
------------
HOUSEHOLD DURABLES -- 2.9%
Fortune Brands, Inc. 2,435 $ 84,592
KB HOME 6,935 94,871
Procter & Gamble Co. 15,235 778,508
Stanley Works (The) 1,645 55,667
------------
$ 1,013,638
------------
INSURANCE -- 4.6%
Chubb Corp. 12,445 $ 496,307
Genworth Financial, Inc. - Class A* 15,300 106,947
MetLife, Inc. 12,105 363,271
Progressive Corp. * 5,610 84,767
Torchmark Corp. 3,150 116,676
Travelers Cos, Inc. (The) 5,450 223,668
Unum Group 13,115 208,004
------------
$ 1,599,640
------------
MATERIALS -- 1.6%
CF Industries Holdings, Inc. 3,205 $ 237,618
Nucor Corp. 7,130 316,786
------------
$ 554,404
------------
MEDIA -- 1.6%
Comcast Corp. - Class A 14,715 $ 213,220
Interpublic Group of Cos., Inc. * 14,775 74,614
Omnicom Group, Inc. 3,770 119,056
Time Warner Cable, Inc. 4,810 152,333
------------
$ 559,223
------------
METALS -- 0.2%
United States Steel Corp. 1,985 $ 70,944
------------
PHARMACEUTICALS & BIOTECHNOLOGY -- 9.8%
Amgen, Inc. * 12,040 $ 637,398
Biogen Idec, Inc. * 3,410 153,962
Forest Labs * 6,385 160,327
Johnson & Johnson 18,595 1,056,196
McKesson Corp. 2,675 117,700
Pfizer, Inc. 61,555 923,325
Watson Pharmaceuticals, Inc. * 10,870 366,210
------------
$ 3,415,118
------------
REAL ESTATE -- 0.3%
HCP, Inc. (REIT) 4,290 $ 90,905
------------
RETAILING -- 5.3%
Big Lots, Inc. * 9,065 $ 190,637
CVS/Caremark Corp. 7,870 250,817
eBay, Inc. * 3,205 54,902
Family Dollar Stores, Inc. 3,080 87,164
GameStop Corp. - Class A* 5,140 113,131
RadioShack Corp. 5,745 80,200
Sherwin-Williams Co. 6,635 356,631
Staples, Inc. 6,530 131,710
TJX Cos., Inc. 7,780 244,759
Wal-Mart Stores, Inc. 7,040 341,018
------------
$ 1,850,969
------------
SEMICONDUCTOR EQUIPMENT & PRODUCTS-- 0.6%
QLogic Corp. * 16,045 $ 203,451
------------
SOFTWARE & SERVICES -- 8.2%
BMC Software, Inc. * 9,130 $ 308,503
CA, Inc. 14,700 256,221
Computer Sciences Corp. * 2,175 96,352
Compuware Corp. * 16,310 111,887
Google, Inc. - Class A* 585 246,630
Microsoft Corp. 34,195 812,815
Oracle Corp. 46,890 1,004,384
------------
$ 2,836,792
------------
TELECOMMUNICATION SERVICES -- 3.6%
AT&T, Inc. 22,715 $ 564,241
CenturyTel, Inc. 4,250 130,475
Verizon Communications, Inc. 18,585 571,117
------------
$ 1,265,833
------------
TRANSPORTATION -- 2.1%
Burlington Northern Santa Fe Corp. 6,305 $ 463,670
Norfolk Southern Corp. 7,300 274,991
------------
$ 738,661
------------
UTILITIES -- 2.8%
Entergy Corp. 4,020 $ 311,630
Exelon Corp. 9,345 478,558
Public Service Enterprise Group, Inc. 5,415 176,691
------------
$ 966,879
------------
TOTAL EQUITY INTERESTS - 99.8%
(identified cost, $39,308,970) $ 34,741,719
OTHER ASSETS, LESS LIABILITIES - 0.2% 68,632
------------
NET ASSETS - 100.0% $ 34,810,351
------------
REIT - Real Estate Investment Trust
* Non-income-producing security.
See notes to financial statements
WRIGHT MAJOR BLUE CHIP EQUITIES FUND (WMBC)
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
ASSETS:
Investments, at value
(identified cost $39,308,970) (Note 1A) $ 34,741,719
Cash 961
Receivable for fund shares sold 37,073
Dividends receivable 43,448
Tax reclaims receivable 171
Prepaid expenses 20,253
------------
Total assets $ 34,843,625
------------
LIABILITIES:
Demand note payable (Note 8) $ 4,000
Payable for fund shares reacquired 8,381
Accrued expenses and other liabilities 20,893
------------
Total liabilities $ 33,274
------------
NET ASSETS $ 34,810,351
============
NET ASSETS CONSIST OF:
Paid-in capital $ 61,253,469
Accumulated net realized loss on investments (22,081,288)
Accumulated undistributed net investment
income 205,421
Unrealized depreciation of investments (4,567,251)
------------
Net assets applicable to outstanding shares $ 34,810,351
============
SHARES OF BENEFICIAL INTEREST OUTSTANDING 3,776,877
============
NET ASSET VALUE, OFFERING PRICE,
AND REDEMPTION PRICE PER SHARE
OF BENEFICIAL INTEREST $ 9.22
============
See notes to financial statements
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
INVESTMENT INCOME (Note 1C)
Dividend income $ 412,584
------------
Expenses -
Investment adviser fee (Note 3) $ 95,223
Administrator fee (Note 3) 19,045
Compensation of Trustees who are not employees
of the investment adviser or administrator 6,425
Custodian fee (Note 1F) 36,549
Distribution expenses (Note 4) 39,676
Transfer and dividend disbursing agent fees 12,269
Printing 2,562
Shareholder communications 2,587
Audit services 16,659
Legal services 1,961
Registration costs 8,933
Miscellaneous 2,634
------------
Total expenses $ 244,523
------------
Deduct -
Waiver and/or reimbursement by the principal
underwriter and/or investment adviser
(Note 3 and 4) $ (37,440)
Reduction of custodian fee (Note 1F) (33)
------------
Total deductions $ (37,473)
------------
Net expenses $ 207,050
------------
Net investment income $ 205,534
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investment transactions $(4,456,766)
Net change in unrealized appreciation (depreciation
on investments 3,991,429
------------
Net realized and unrealized loss
on investments $ (465,337)
------------
Net decrease in net assets from operations $ (259,803)
============
See notes to financial statements
WRIGHT MAJOR BLUE CHIP EQUITIES FUND (WMBC)
- -------------------------------------------------------------------------------
Six Months Ended Year Ended,
STATEMENTS OF CHANGES IN NET ASSETS June 30, 2009 December 31, 2008
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
INCREASE (DECREASE) IN NET ASSETS:
From operations -
Net investment income $ 205,534 $ 390,585
Net realized loss on investment transactions (4,456,766) (2,313,558)
Net change in unrealized appreciation (depreciation) on investments 3,991,429 (17,276,483)
-------------- --------------
Net decrease in net assets from operations $ (259,803) $(19,199,456)
-------------- --------------
Distributions to shareholders (Note 2) -
From net investment income $ (7,774) $ (399,235)
-------------- --------------
Total distributions $ (7,774) $ (399,235)
-------------- --------------
Net increase (decrease) in net assets from fund share transactions (Note 6) $ 2,594,344 $ (5,667,495)
-------------- --------------
Net increase (decrease) in net assets $ 2,326,767 $(25,266,186)
NET ASSETS:
At beginning of period 32,483,584 57,749,770
-------------- --------------
At end of period $ 34,810,351 $ 32,483,584
============== ==============
ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME
INCLUDED IN NET ASSETS AT END OF PERIOD $ 205,421 $ 7,661
============== ==============
See notes to finanxial statements
WRIGHT MAJOR BLUE CHIP EQUITIES FUND (WMBC)
- -------------------------------------------------------------------------------
Six Months
Ended June 30 Year Ended December 31,
- --------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 2009(3) 2008(3) 2007(3) 2006(3) 2005 2004
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Net asset value, beginning of period $ 9.340 $ 14.520 $ 13.790 $ 12.420 $ 11.780 $ 10.530
--------- --------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income(1) $ 0.055 $ 0.104 $ 0.091 $ 0.062 $ 0.077 $ 0.053
Net realized and unrealized gain (loss) (0.173) (5.169) 0.728 1.374 0.651 1.247
--------- --------- --------- --------- --------- ---------
Total income (loss) from
investment operations $ (0.118) $ (5.065) $ 0.819 $ 1.436 $ 0.728 $ 1.300
--------- --------- --------- --------- --------- ---------
Less distributions:
From net investment income $ (0.002) $ (0.115) $ (0.089) $ (0.066) $ (0.088) $ (0.050)
--------- --------- --------- --------- --------- ---------
Total distributions $ (0.002) $ (0.115) $ (0.089) $ (0.066) $ (0.088) $ (0.050)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 9.220 $ 9.340 $ 14.520 $ 13.790 $ 12.420 $ 11.780
========= ========= ========= ========= ========= =========
Total Return(2) (1.26)%(5) (34.85)% 5.96% 11.57% 6.20% 12.36%
========= ========= ========= ========= ========= =========
Ratios/Supplemental Data(1):
Net assets, end of period (000 omitted) $ 34,810 $ 32,484 $ 57,750 $ 63,276 $ 66,742 $ 65,503
Ratios (As a percentage of average daily net assets):
Net expenses 1.30%(4) 1.26% 1.26% 1.26% 1.26% 1.25%
Net expenses after custodian fee reduction 1.30%(4) 1.25% 1.25% 1.25% 1.25% 1.25%
Net investment income 1.29%(4) 0.86% 0.63% 0.48% 0.66% 0.49%
Portfolio turnover rate 23%(5) 58% 55% 97% 82% 74%
- --------------------------------------------------------------------------------------------------------------------------------
(1) For the six months ended June 30, 2009 and for the years ended December 31,
2008, 2007, 2006, 2005 and 2004, the operating expenses of the Fund were
reduced by a waiver of fees and/or an allocation of expenses to the
principal underwriter and/or investment adviser. Had such action not been
undertaken, net investment income per share and the ratios would have been
as follows:
2009 2008 2007 2006 2005 2004
- --------------------------------------------------------------------------------------------------------------------------------
Net investment income per share $ 0.045 $ 0.091 $ 0.088 $ 0.062 $ 0.077 $ 0.050
========= ========= ========= ========= ========= =========
Ratios (As a percentage of average daily net assets):
Expenses 1.54%(4) 1.37% 1.28% 1.28% 1.26% 1.28%
========= ========= ========= ========= ========= =========
Expenses after custodian fee reduction 1.54%(4) 1.36% 1.27% 1.27% 1.25% 1.28%
========= ========= ========= ========= ========= =========
Net investment income 1.06%(4) 0.75% 0.61% 0.46% 0.66% 0.46%
========= ========= ========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the reinvestment date.
(3) Certain per share amounts are based on average shares outstanding.
(4) Annualized.
(5) Not annualized.
See notes to financial statements
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND (WIBC)
- -------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS - AS OF JUNE 30, 2009 (UNAUDITED)
Shares Value
EQUITY INTERESTS - 99.3%
AUSTRALIA -- 2.4%
BHP Billiton, Ltd. 31,041 $ 871,302
BlueScope Steel, Ltd. 209,140 427,770
Sims Metal Management, Ltd. 8,093 173,449
------------
$ 1,472,521
------------
AUSTRIA -- 0.2%
Wienerberger AG (1)* 9,363 $ 115,965
------------
CANADA -- 9.6%
Canadian National Railway Co. 16,240 $ 698,767
Canadian Natural Resources, Ltd. 2,774 146,158
CGI Group, Inc. - Class A* 66,772 594,500
Encana Corp. (1) 17,041 846,217
Husky Energy, Inc. (1) 18,631 521,864
Methanex Corp. 14,435 175,380
Nexen, Inc. 13,869 301,778
Petro-Canada 10,093 390,388
Potash Corp. of Saskatchewan, Inc. 4,401 411,129
Research In Motion, Ltd. * 7,822 556,872
Teck Cominco, Ltd. - Class B 13,235 211,400
Toronto-Dominion Bank 21,801 1,128,017
------------
$ 5,982,470
------------
CHINA -- 0.2%
China Railway Group, Ltd. * 161,000 $ 129,422
------------
DENMARK -- 0.3%
A. P. Moller-Maersk A/S - Series B 32 $ 191,667
------------
FINLAND -- 0.9%
Nokia Oyj 36,660 $ 536,837
------------
FRANCE -- 11.9%
AXA (Actions Ordinaires) (1) 20,530 $ 385,584
BNP Paribas 13,242 859,043
Casino Guichard-Perrachon SA 11,843 798,187
Compagnie Generale des Etablissements
Michelin - Class B (1) 3,534 201,277
France Telecom SA 11,289 255,886
Groupe Danone (1) 21,697 1,070,644
Renault SA * 7,546 276,994
Sanofi-Aventis 10,560 620,178
Schneider Electric SA 3,842 292,622
Societe Generale de France
(Actions Ord.) 7,531 410,756
Total SA 19,174 1,034,897
Vallourec SA 4,351 528,087
Vinci SA 4,891 219,429
Vivendi 8,912 212,944
Zodiac Aerospace (1) 8,419 273,494
------------
$ 7,440,022
------------
GERMANY -- 5.9%
BASF AG (Stammaktie) 17,918 $ 712,009
Deutsche Bank AG (Stammaktie) (1) 10,365 627,989
E.On AG (Stammaktie) 22,890 809,730
K+S AG 4,422 248,287
MAN AG 4,026 246,777
Muenchener Rueckversicherungs-
Gesellschaft AG 2,892 390,192
Porsche AG (Preferred Stock) 2,577 172,779
Salzgitter AG 1,101 96,397
Siemens AG 3,517 242,512
ThyssenKrupp AG 5,215 129,399
------------
$ 3,676,071
------------
HONG KONG -- 5.0%
BOC Hong Kong Holdings, Ltd. 141,000 $ 247,067
Cheung Kong Holdings, Ltd. 35,000 402,384
CLP Holdings, Ltd. (Ordinary) 172,000 1,140,741
Henderson Land Development Co., Ltd. 75,000 427,255
Hong Kong Exchanges & Clearing, Ltd. 26,400 411,497
Sun Hung Kai Properties, Ltd. 40,000 499,610
------------
$ 3,128,554
------------
INDIA -- 0.3%
Tata Motors, Ltd. (1)* 18,718 $ 159,477
------------
ITALY -- 2.6%
Eni SpA (Azioni Ordinarie) 67,798 $ 1,602,383
------------
JAPAN -- 17.3%
Aisin Seiki Co., Ltd. (1) 16,400 $ 356,097
Astellas Pharma, Inc. 34,000 1,205,161
Canon, Inc. (1) 8,300 271,835
Denso Corp. 8,800 226,191
Fanuc, Ltd. 3,900 313,665
Honda Motor Co., Ltd. 25,200 694,740
Itochu Corp. 61,000 424,854
Makita Corp. 30,800 745,380
Mazda Motor Corp. 122,000 312,318
Mitsubishi Corp. 24,900 461,431
Mitsubishi Gas Chemical Co., Inc. 26,000 142,281
Mitsui & Co., Ltd. 30,000 356,325
Mitsui OSK Lines, Ltd. 130,000 844,795
Nintendo Company, Ltd. 1,100 303,602
Nippon Electric Glass Co., Ltd. 27,000 302,783
Nippon Steel Corp. * 86,000 329,792
Nippon Yusen Kabushiki Kaisha 160,000 691,506
Nissan Motor Co., Ltd. * 78,300 475,554
Sankyo Co., Ltd. 5,700 304,244
Sumitomo Corp. (1) 71,900 731,780
Sysmex Corp. (1) 5,850 212,209
Tokai Rika Co., Ltd. (1) 22,600 360,485
Tokyo Electron, Ltd. 6,500 314,609
Toyota Motor Corp. 11,000 418,407
------------
$ 10,800,044
------------
NETHERLANDS -- 1.7%
ING Groep NV (Aandeel) 47,747 $ 480,326
Koninklijke (Royal) KPN NV 44,035 605,242
------------
$ 1,085,568
------------
NORWAY -- 1.0%
StatoilHydro ASA (1) 19,064 $ 374,968
Telenor Group ASA * 33,776 259,491
------------
$ 634,459
------------
SINGAPORE -- 2.6%
DBS Group Holdings, Ltd. 35,000 $ 285,349
Jardine Cycle & Carriage, Ltd. 69,000 915,328
Overseas-Chinese Banking Corp., Ltd. 88,000 406,149
------------
$ 1,606,826
------------
SPAIN -- 8.0%
Acciona SA (1) 2,396 $ 294,402
Banco Bilbao Vizcaya Argentaria SA (1)30,837 386,687
Banco Santander SA 102,002 1,224,706
EDP Renovaveis SA * 20,931 214,320
Iberdrola Renovables SA * 80,313 366,679
Mapfre SA 105,237 342,457
Repsol YPF SA (Accion) (1) 13,511 302,082
Telefonica SA 82,718 1,870,314
------------
$ 5,001,647
------------
SWEDEN -- 1.6%
AB SKF - Series B 35,925 $ 440,493
Peab AB 38,921 159,244
TeliaSonera AB 74,831 391,161
------------
$ 990,898
------------
SWITZERLAND -- 10.0%
ABB, Ltd. 15,538 $ 244,025
Adecco SA 7,116 296,143
Credit Suisse Group AG 13,944 635,945
Holcim, Ltd. 3,335 189,205
Logitech International SA * 14,195 196,437
Nestle SA 27,914 1,050,288
Novartis AG 12,264 496,627
Roche Holding AG 4,567 620,243
Swiss Re AG 34,317 1,134,065
Syngenta AG 558 129,424
Zurich Financial Services
(Inhaberaktie) 6,846 1,204,841
------------
$ 6,197,243
------------
UNITED ARAB EMIRATES -- 0.6%
Dragon Oil PLC * 66,789 $ 399,819
------------
UNITED KINGDOM -- 17.2%
Anglo American PLC (Ordinary) 14,345 $ 416,610
AstraZeneca PLC 31,785 1,397,876
Barclays PLC (Ordinary) 335,556 1,563,887
BG Group PLC 10,824 181,464
BHP Billiton PLC 36,514 820,215
BP PLC 86,914 683,896
British American Tobacco PLC 13,012 358,504
Carnival PLC * 12,761 337,718
GlaxoSmithKline PLC 32,470 571,361
HSBC Holdings PLC 143,028 1,183,617
Man Group PLC 148,483 678,568
Next PLC 8,687 210,158
Rio Tinto PLC 11,531 399,736
Royal Dutch Shell PLC 36,226 910,393
Sage Group PLC (The) 40,217 117,958
Unilever PLC 8,695 203,908
Vodafone Group PLC 227,216 438,551
WPP PLC 39,414 261,745
------------
$ 10,736,165
------------
TOTAL EQUITY INTERESTS - 99.3%
(identified cost, $66,582,607) $ 61,888,058
------------
RIGHTS - 0.1%
Casino Guichard-Perrachon SA,
Expires 7/10/09 * 12,176 $ 46,966
------------
Total RIGHTS - 0.1%
(identified cost, $44,731) $ 46,966
------------
SHORT-TERM INVESTMENTS - 10.1%
State Street Navigator Securities
Lending Prime Portfolio, 0.66%(2) 6,274,660 $ 6,274,660
------------
TOTAL SHORT-TERM INVESTMENTS - 10.1%
(identified cost, $6,274,660) $ 6,274,660
------------
TOTAL INVESTMENTS - 109.5%
(identified cost, $72,901,998) $ 68,209,684
OTHER ASSETS, LESS LIABILITIES - (9.5)% (5,903,045)
------------
NET ASSETS - 100.0% $ 62,306,639
============
* Non-income-producing security.
(1) All or a portion on these securities were on loan at June 30, 2009.
(2) The amount invested in State Street Navigator Securities Lending Prime
Portfolio represents cash collateral received for securities on loan as of
June 30, 2009. Other Assets, Less Liabilities includes an equal and
offsetting liability of the Fund to repay collateral amounts upon the return
of loaned securities.
Portfolio Composition By Sector
-------------------------------
% of net assets at 6/30/09
Financials...........................24.8%
Industrials..........................13.0%
Energy...............................12.5%
Consumer Discretionary...............10.5%
Other................................39.2%
See notes to financial statements
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND (WIBC)
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
ASSETS:
Investments, at value including $5,904,885 of
securities loaned (identified cost $72,901,998)
(Note 1A) $ 68,209,684
Foreign currency, at value (cost 94,864)
(Note 1A) 94,864
Cash 10,300
Receivable for fund shares sold 33,200
Dividends receivable 134,403
Tax reclaims receivable 125,821
Prepaid expenses 21,995
------------
Total assets $ 68,630,267
------------
LIABILITIES:
Demand note payable (Note 8) $ 10,000
Payable for fund shares reacquired 11,372
Collateral for securities loaned 6,274,660
Accrued expenses and other liabilities 27,596
------------
Total liabilities $ 6,323,628
------------
NET ASSETS $ 62,306,639
============
NET ASSETS CONSIST OF:
Paid-in capital $121,285,722
Accumulated net realized loss on investments
and foreign currency (55,376,863)
Accumulated undistributed net
investment income 1,047,321
Unrealized depreciation of
investments and foreign currency (4,649,541)
------------
Net assets applicable to outstanding shares $ 62,306,639
============
SHARES OF BENEFICIAL INTEREST OUTSTANDING 5,280,128
============
NET ASSET VALUE, OFFERING PRICE,
AND REDEMPTION PRICE PER SHARE
OF BENEFICIAL INTEREST $ 11.80
============
See notes to financial statements
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
INVESTMENT INCOME (Note 1C)
Dividend income (net of foreign
taxes, 161,283) $ 1,381,476
Income from securities lending 70,152
Other income 53,821
------------
Total Investment Income $ 1,505,449
------------
Expenses -
Investment adviser fee (Note 3) $ 231,510
Administrator fee (Note 3) 49,196
Compensation of Trustees who are not employees
of the investment adviser or administrator 6,376
Custodian fee (Note 1F) 28,189
Distribution expenses (Note 4) 72,398
Transfer and dividend disbursing agent fees 21,639
Printing 4,241
Interest expense 4,585
Shareholder communications 6,505
Audit services 14,119
Legal services 3,025
Registration costs 10,806
Miscellaneous 5,560
------------
Total expenses $ 458,149
------------
Deduct -
Reduction of custodian fee (Note 1F) $ (21)
------------
Total deductions $ (21)
------------
Net expenses $ 458,128
------------
Net investment income $ 1,047,321
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss -
Investment transactions $(19,383,576)
Foreign currency transactions (10,114)
------------
Net realized loss $(19,393,690)
------------
Change in unrealized appreciation
(depreciation)
Investments $ 22,846,051
Foreign currency 5,105
------------
Net change in unrealized appreciation
(depreciation) $ 22,851,156
------------
Net realized and unrealized gain on
investments $ 3,457,466
------------
Net increase in net assets from
operations $ 4,504,787
============
See notes to financial statements
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND (WIBC)
- -------------------------------------------------------------------------------
Six Months Ended Year Ended,
STATEMENTS OF CHANGES IN NET ASSETS June 30, 2009 December 31, 2008
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
INCREASE (DECREASE) IN NET ASSETS:
From operations -
Net investment income $ 1,047,321 $ 3,554,025
Net realized loss on investment and foreign currency transactions (19,393,690) (34,680,086)
Net change in unrealized appreciation (depreciation) of investments and
foreign currency 22,851,156 (46,890,575)
--------------- --------------
Net increase (decrease) in net assets from operations $ 4,504,787 $(78,016,636)
--------------- --------------
Distributions to shareholders (Note 2) -
From net investment income $ -- $ (3,451,012)
From net realized gains -- (4,298,181)
Tax return of capital -- (48,984)
--------------- --------------
Total distributions $ -- (7,798,177)
--------------- --------------
Net decrease in net assets from fund share transactions (Note 6) $ (9,343,682) $(30,647,579)
--------------- --------------
Net decrease in net assets $ (4,838,895) $(116,462,392)
NET ASSETS:
At beginning of period 67,145,534 183,607,926
--------------- --------------
At end of period $ 62,306,639 $ 67,145,534
=============== ==============
ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME
INCLUDED IN NET ASSETS AT END OF PERIOD $ 1,047,321 $ --
=============== ==============
See notes to financial statements
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND (WIBC)
- -------------------------------------------------------------------------------
Six Months
Ended June 30 Year Ended December 31,
- --------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 2009(1) 2008(1) 2007(1) 2006(1) 2005(1) 2004
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Net asset value, beginning of period $ 10.810 $ 22.470 $ 22.830 $ 18.060 $ 15.070 $12.890
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income $ 0.184 $ 0.483 $ 0.434 $ 0.255 $ 0.129 $ 0.128
Net realized and unrealized gain (loss) 0.806 (11.002) 0.755 4.859 3.028 2.140
---------- ---------- ---------- ---------- ---------- ----------
Total income (loss) from investment
operations $ 0.990 $ (10.519) $ 1.189 $ 5.114 $ 3.157 $ 2.268
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
From net investment income $ -- $ (0.575) $ (0.491) $ (0.320) $ (0.167) $(0.088)
From net realized gains -- (0.558) (1.058) (0.024) - -
Tax return of capital -- (0.008) - - - -
---------- ---------- ---------- ---------- ---------- ----------
Total distributions $ -- $ (1.141) $ (1.549) $ (0.344) $ (0.167) $(0.088)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value, end of period $ 11.800 $ 10.810 $ 22.470 $ 22.830 $ 18.060 $15.070
========== ========== ========== ========== ========== ==========
Total Return(2) 9.16%(4) (47.74)% 5.50% 28.49% 21.13% 17.71%
========== ========== ========== ========== ========== ==========
Ratios/Supplemental data:
Net assets, end of period (000 omitted) $ 62,307 $ 67,146 $ 183,608 $ 218,201 $ 109,897 $ 62,266
Ratios (As a percentage of average daily net assets):
Net expenses 1.58%(3) 1.54% 1.49% 1.46% 1.66% 1.72%
Net expenses after custodian fee reduction 1.58%(3) 1.53% 1.47% 1.37% 1.62% 1.71%
Net investment income 3.62%(3) 2.71% 1.82% 1.26% 0.81% 0.97%
Portfolio turnover rate 36%(4) 82% 138% 116% 99% 121%
- --------------------------------------------------------------------------------------------------------------------------------
(1) Certain per share amounts are based on average shares outstanding.
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the reinvestment date.
(3) Annualized.
(4) Not annualized.
See notes to financial statements
WRIGHT MANAGED EQUITY TRUST
- ------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies
---------------------------------
The Wright Managed Equity Trust (the Trust), issuer of Wright Select Blue Chip
Equities Fund (WSBC) series, Wright Major Blue Chip Equities Fund (WMBC) series,
and Wright International Blue Chip Equities Fund (WIBC) series (collectively,
the Funds), is registered under the Investment Company Act of 1940, as amended
(the 1940 Act), as a diversified, open-end management investment company. The
Funds seek to provide total return consisting of price appreciation and current
income.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
policies are in conformity with accounting principles generally accepted in the
United States of America.
A. Investment Valuations -Equity securities listed on a U.S. securities exchange
generally are valued at the last sale price on the day of valuation or, if no
sales took place on such date, at the mean between the closing bid and asked
prices therefore on the exchange where such securities are principally traded.
Equity securities listed on the NASDAQ Global or Global Select Market generally
are valued at the NASDAQ official closing price. Unlisted or listed securities
for which closing sales prices or closing quotations are not available are
valued at the mean between the latest available bid and asked prices or, in the
case of preferred equity securities that are not listed or traded in the
over-the-counter market, by a third party pricing service. Investments in
open-end mutual funds are valued at net asset value. Short-term debt securities
with a remaining maturity of sixty days or less are generally valued at
amortized cost, which approximates market value. If short-term debt securities
are acquired with a remaining maturity of more than sixty days, they will be
valued by a third party pricing service. Foreign securities and currencies are
valued in U.S. dollars, based on foreign currency exchange rate quotations
supplied by a third party pricing service. The pricing service uses a
proprietary model to determine the exchange rate. Inputs to the model include
reported trades and implied bid/ask spreads. The daily valuation of
exchange-traded foreign securities generally is determined as of the close of
trading on the principal exchange on which such securities trade. Events
occurring after the close of trading on foreign exchanges are monitored by the
investment adviser and may result in adjustments to the valuation of foreign
securities to more accurately reflect their fair value as of the close of
regular trading on the New York Stock Exchange. Investments for which valuations
or market quotations are not readily available or are deemed unreliable are
valued at fair value using methods determined in good faith by or at the
direction of the Trustees of the Fund in a manner that most fairly reflects the
security's value, or the amount that the Fund might reasonably expect to receive
for the security upon its current sale in the ordinary course. Each such
determination is based on a consideration of all relevant factors, which are
likely to vary from one pricing context to another. These factors may include,
but are not limited to, the type of security, the existence of any contractual
restrictions on the security's disposition, the price and extent of public
trading in similar securities of the issuer or of comparable companies,
quotations or relevant information obtained from broker-dealers or other market
participants, information obtained from the issuer, analysts, and/or the
appropriate stock exchange (for exchange-traded securities), an analysis of the
company's financial condition, and an evaluation of the forces that influence
the issuer and the market(s) in which the security is purchased and sold.
B. Investment Transactions - Investment transactions for financial statement
purposes are accounted for on a trade date basis. Realized gains and losses on
investments sold are determined on the basis of identified cost.
C. Income - Dividend income is recorded on the ex-dividend date for dividends
received in cash and/or securities. However, if the ex-dividend date has passed,
certain dividends from foreign securities are recorded as the Fund is informed
of the ex-dividend date. Withholding taxes on foreign dividends and capital
gains have been provided for in accordance with the Funds' understanding of
applicable countries' tax rules and rates. Interest income is recorded on the
basis of interest accrued, adjusted for amortization of premium and accretion of
discount.
D. Federal Taxes - Each Fund's policy is to comply with the provisions of the
Internal Revenue Code (the Code) applicable to regulated investment companies
and to distribute to shareholders each year substantially all of its taxable
income and all or substantially all of its net realized capital gains.
Accordingly, no provision for federal income or excise tax is necessary. At
December 31, 2008, WSBC, WMBC and WIBC, for federal income tax purposes, had
capital loss carryovers of $640,031, $15,844,437 and $18,850,926, respectively,
which will reduce the Fund's taxable income arising from future net realized
gain on investment transactions, if any, to the extent permitted by the Code,
and thus will reduce the amount of the distributions to shareholders, which
would otherwise be necessary to relieve the Fund of any liability for federal
income or excise tax. Pursuant to the Code, such capital loss carryovers will
expire as follows:
December 31, WSBC WMBC WIBC
- -------------------------------------------------------------------------------
2010 $ - $ 12,738,080 $ -
2011 - 2,230,768 -
2016 640,031 875,589 18,850,926
- -------------------------------------------------------------------------------
Additionally, at December 31, 2008, WSBC, WMBC and WIBC had net capital losses
of $593,005, $1,749,806 and $12,196,103, respectively, attributable to security
transactions incurred after October 31, 2008. These net capital losses are
treated as arising on the first day of the Funds' taxable year ending December
31, 2009.
As of June 30, 2009, the Funds had no uncertain tax positions that would require
financial statement recognition, de-recognition, or disclosure. Each of the
Funds' federal tax returns filed in the 3-year period ended December 31, 2008
remains subject to examination by the Internal Revenue Service.
E. Expenses - The majority of expenses of the Trust are directly identifiable to
an individual Fund. Expenses which are not readily identifiable to a specific
Fund are allocated taking into consideration, among other things, the nature and
type of expense and the relative size of the Funds.
F. Expense Reduction - State Street Bank & Trust Company (SSBT) serves as
custodian to the Funds. Pursuant to the custodian agreement, SSBT receives a fee
reduced by credits which are determined based on the average daily cash balance
the Funds maintain with SSBT. All credit balances, if any, used to reduce each
Fund's custodian fees are reported as a reduction of expenses in the Statement
of Operations.
G. Foreign Currency Translation -- Investment valuations, other assets, and
liabilities initially expressed in foreign currencies are translated each
business day into U.S. dollars based upon current exchange rates. Purchases and
sales of foreign investment securities and income and expenses denominated in
foreign currencies are translated into U.S. dollars based upon currency exchange
rates in effect on the respective dates of such transactions. Recognized gains
or losses on investment transactions attributable to changes in foreign currency
exchange rates are recorded for financial statement purposes as net realized
gains and losses on investments. That portion of unrealized gains and losses on
investments that results from fluctuations in foreign currency exchange rates is
not separately disclosed.
H. Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements and
the reported amounts of income and expense during the reporting period. Actual
results could differ from those estimates.
I. Indemnifications - Under each Fund's organizational documents, its officers
and Trustees may be indemnified against certain liabilities and expenses arising
out of the performance of their duties to the Funds, and shareholders are
indemnified against personal liability for the obligations of the Funds.
Additionally, in the normal course of business, the Funds enter into agreements
with service providers that may contain indemnification clauses. Each Fund's
maximum exposure under these arrangements is unknown as this would involve
future claims that may be made against the Funds that have not yet occurred.
J. Interim Financial Statements - The interim financial statements relating to
June 30, 2009 and for the six months then ended have not been audited by an
independent registered public accounting firm, but in the opinion of the Funds'
management, reflect all adjustments, consisting only of normal recurring
adjustments, necessary for the fair presentation of the financial statements.
2. Distributions to Shareholders
-----------------------------
It is the present policy of the Trust to make annual distributions of all or
substantially all of the net investment income of the Funds and to distribute
annually all or substantially all of the net realized capital gains (reduced by
available capital loss carryforwards from prior years, if any) of the Funds.
Distributions to shareholders are recorded on the ex-dividend date. Shareholders
may reinvest income and capital gain distributions in additional shares of the
same Fund at the net asset value as of the ex-dividend date or, at the election
of the shareholder, receive distributions in cash. The Funds distinguish between
distributions on a tax basis and a financial reporting basis. Accounting
principles generally accepted in the United States of America require that only
distributions in excess of tax basis earnings and profits be reported in the
financial statements as a return of capital. Permanent differences between book
and tax accounting relating to distributions are reclassified to paid-in
capital. For tax purposes, distributions from short-term capital gains are
considered to be from ordinary income.
3. Investment Adviser Fee and Other Transactions with Affiliates
-------------------------------------------------------------
The investment adviser fee is earned by Wright Investor Services, Inc. (Wright)
as compensation for investment advisory services rendered to the Funds. For
WIBC, the fee is computed at an annual rate of 0.80% of its average daily net
assets up to $100 million and at reduced rates as net assets exceed that level,
and is payable monthly. For WSBC and WMBC, the fee is computed at an annual rate
of 0.60% of their average daily net assets up to $100 million and at reduced
rates as net assets exceed that level, and is payable monthly. For the six
months ended June 30, 2009, the fee and the effective annual rate, as a
percentage of average daily net assets for each of the Funds were as follows:
Fund Investment Adviser Fee Effective Annual Rate
----------------------------------------------------------------
WSBC $ 37,877 0.60%
WMBC 95,223 0.60%
WIBC 231,510 0.80%
- ------------------------------------------------------------------------------
The administrator fee is earned by Eaton Vance Management (Eaton Vance) for
administering the business affairs of each Fund. The fee is computed at an
annual rate of 0.17% of WIBC's average daily net assets up to $100 million and
0.07% of average daily net assets over $100 million. The fee is computed at an
annual rate of 0.12% of WSBC's and WMBC's average daily net assets up to $100
million and 0.07% of average daily net assets over $100 million. For the six
months ended June 30, 2009, the administrator fee for WSBC, WMBC and WIBC
amounted to $7,575, $19,045 and $49,196, respectively. Wright also waived and/or
reimbursed expenses for WSBC and WMBC (see Note 4).
Certain of the Trustees and officers of the Trust are Trustees or officers of
the above organizations and/or of the Funds' principal underwriter. Except as to
Trustees of the Trust who are not employees of Eaton Vance or Wright, Trustees
and officers receive remuneration for their services to the Trust out of the
fees paid to Eaton Vance and Wright.
4. Distribution and Service Plans
--------------------------------
The Trust has in effect a Distribution Plan (the Plan) pursuant to Rule 12b-1 of
the 1940 Act. The Plan provides that each Fund will pay Wright Investors'
Service Distributors, Inc. (WISDI), the principal underwriter, a wholly-owned
subsidiary of The Winthrop Corporation and an affiliate of Wright, a
distribution fee of 0.25% of the average daily net assets of each Fund for
distribution services and facilities provided to the Funds by WISDI.
Distribution fees paid or accrued to WISDI for the six months ended June 30,
2009 for WSBC, WMBC and WIBC were $15,782, $39,676 and $72,398, respectively. In
addition, the Trustees have adopted a service plan (the Service Plan) which
allows the Funds to reimburse the principal underwriter for payments to
intermediaries for providing account administration and personal and account
maintenance services to their customers who are beneficial owners of each Fund's
shares. The combined amount of service fees payable under the Service Plan and
Rule 12b-1 distribution fees may not exceed 0.25% annually of each Fund's
average daily net assets. For the six months ended June 30, 2009, the Funds did
not accrue or pay any service fees. Pursuant to an Expense Limitation Agreement,
Wright and WISDI have agreed to waive all or a portion of their fees and
reimburse expenses to the extent that total annual operating expenses after
custodian fee reductions, if any, exceed 1.40% (1.25% prior to May 1, 2009) of
the average daily net assets of each of WSBC and WMBC through April 30, 2010.
Thereafter, the waiver and reimbursement may be changed or terminated at any
time. Pursuant to this agreement, Wright and WISDI waived and/or reimbursed
expenses in the aggregate of $60,167 and $37,440 for WSBC and WMBC,
respectively.
5. Investment Transactions
-------------------------
Purchases and sales of investments, other than short-term obligations, were as
follows:
Six Months Ended June 30, 2009
----------------------------------------------------------
WSBC WMBC WIBC
- ----------------------------------------------------------------------------------------------------------------------
Purchases $ 1,700,115 $ 10,322,144 $ 21,239,404
================ ================ ================
Sales $ 1,984,619 $ 7,195,289 $ 28,921,383
================ ================ ================
- -----------------------------------------------------------------------------------------------------------------------
6. Shares of Beneficial Interest
------------------------------
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follows:
Six Months Ended Year Ended
June 30, 2009 (Unaudited) December 31, 2009
------------------------- -----------------
Shares Amount Shares Amount
- --------------------------------------------------------------------------------------------------------------------------------
WRIGHT SELECTED BLUE CHIP EQUITIES FUND
Sold 106,182 $ 643,597 427,666 $ 2,870,659
Issued to shareholders in payment of distributions declared - - 192,784 1,704,210
Redemptions (251,746) (1,515,778) (571,344) (5,060,980)
------------ ---------------- ------------ ----------------
Net increase (decrease) (145,564 $ (872,181) 49,106 $ (486,111)
============ ================ ============ ================
WRIGHT MAJOR BLUE CHIP EQUITIES FUND
Sold 724,559 $ 6,222,542 604,845 $ 7,164,833
Issued to shareholders in payment of distributions declared 846 6,203 34,851 314,669
Redemptions (427,519) (3,634,401) (1,138,917) (13,146,997)
------------ ---------------- ------------ ----------------
Net increase (decrease) 297,886 $ 2,594,344 (499,221) $ (5,667,495)
============ ================ ============ ================
WRIGHT INTERNATIONAL BLUE CHIP EQUITIES FUND
Sold 487,176 $ 4,879,779 1,072,677 $ 19,169,564
Issued to shareholders in payment of distributions declared - - 435,264 6,310,860
Redemptions (1,418,143) (14,223,541) (3,468,134) (56,133,850)
Redemption fees - 80 - 5,847
------------ ---------------- ------------ ----------------
Net decrease (930,967) $ (9,343,682) (1,960,193) $ (30,647,579)
============ ================ ============ ================
- --------------------------------------------------------------------------------------------------------------------------------
7. Federal Income Tax Basis of Investments
---------------------------------------
The cost and unrealized appreciation (depreciation) of the investment securities
owned at June 30, 2009, as determined on a federal income tax basis, were as
follows:
Six Months Ended June 30, 2009
-----------------------------------------------------------------
WSBC WMBC WIBC
- --------------------------------------------------------------------------------------------------------------------
Aggregate cost $ 15,927,140 $ 39,339,249 $ 77,838,142
================ ================ ================
Gross unrealized appreciation $ 813,234 $ 2,400,131 $ 1,068,254
Gross unrealized depreciation (3,167,803) (6,997,661) (10,696,712)
---------------- ---------------- ----------------
Net unrealized depreciation $ (2,354,569) $ (4,597,530) $ (9,628,458)
================ ================ =================
- --------------------------------------------------------------------------------------------------------------------------------
8. Line of Credit
--------------
The Funds participate with other funds managed by Wright in a committed $10
million unsecured line of credit agreement with a bank. The Funds may
temporarily borrow from the line of credit to satisfy redemption requests or
settle investment transactions. Interest is charged to each Fund based on its
borrowings at an amount above the Federal Funds rate. In addition, a fee
computed at an annual rate of 0.10% on the average daily unused portion of the
$10 million line of credit is allocated among the participating funds at the end
of each quarter. At June 30, 2009, WSBC, WMBC and WIBC had a balance outstanding
pursuant to this line of credit of $123,000, $4,000 and $10,000, respectively,
at an interest rate of 1.28%.
The average borrowings and average interest rate (annualized) for the six months
ended June 30, 2009 were as follows:
WSBC WMBC WIBC
- -------------------------------------------------------------------------------
Average borrowings $ 35,234 $ 1,575 $ 319,928
Average interest rate 1.2% 1.3% 1.1%
- -------------------------------------------------------------------------------
9. Risks Associated With Foreign Investments
-----------------------------------------
Investing in securities issued by companies whose principal business activities
are outside the United States may involve significant risks not present in
domestic investments. For example, there is generally less publicly available
information about foreign companies, particularly those not subject to the
disclosure and reporting requirements of the U.S. securities laws. Certain
foreign issuers are generally not bound by uniform accounting, auditing, and
financial reporting requirements and standards of practice comparable to those
applicable to domestic issuers. Investments in foreign securities also involve
the risk of possible adverse changes in investment or exchange control
regulations, expropriation or confiscatory taxation, limitation on the removal
of funds or other assets of the Funds, political or financial instability or
diplomatic and other developments which could affect such investments. Foreign
stock markets, while growing in volume and sophistication, are generally not as
developed as those in the United States, and securities of some foreign issuers
(particularly those located in developing countries) may be less liquid and more
volatile than securities of comparable U.S. companies. In general, there is less
overall governmental supervision and regulation of foreign securities markets,
broker-dealers and issuers than in the United States.
10. Securities Lending Agreement
----------------------------
The Wright International Blue Chip Fund has established a securities lending
agreement with SSBT as securities lending agent in which the Fund lends
portfolio securities to a broker in exchange for collateral consisting of cash
in an amount at least equal to the market value of the securities on loan. Cash
collateral is invested in State Street Navigator Securities Lending Prime
Portfolio (the Portfolio). The Fund earns interest on the amount invested in the
Portfolio, but it must pay the broker a loan rebate fee computed as a varying
percentage of the collateral received. The loan rebate fee paid by the Fund
amounted to $10,017 for the six months ended June 30, 2009. At June 30, 2009,
the value of the securities loaned and the value of the collateral amounted to
$5,904,885 and $6,274,660, respectively. In the event of counterparty default,
the Fund is subject to potential loss if it is delayed or prevented from
exercising its right to dispose of the collateral. The Fund bears risk in the
event that invested collateral is not sufficient to meet obligations due on
loans. The Fund has the right under the securities lending agreement to recover
the securities from the borrower on demand.
11. Fair Value Measurements
-----------------------
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 157 (FAS 157), "Fair Value Measurements", established a three-tier hierarchy
to prioritize the assumptions, referred to as inputs, used in valuation
techniques to measure fair value. The three-tier hierarchy of inputs is
summarized in the three broad levels listed below.
o Level 1 - quoted prices in active markets for identical investments
o Level 2 - other significant observable inputs (including quoted prices
for similar investments, interest rates, prepayment speeds, credit risk, etc.)
o Level 3 - significant unobservable inputs (including a fund's own
assumptions in determining the fair value of investments)
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
At June 30, 2009, the inputs used in valuing each Fund's investments, which are
carried at value, were as follows:
WSBC
Quoted Prices in
Active Markets for Significant Other Significant
Assets Description Identical Assets Observable Inputs Unobservable Inputs Total
(Level 1) (Level 2) (Level 3)
- --------------------------------------------------------------------------------------------------------------------------------
Total Investments $13,572,571 $ - $ - $13,572,571
------------------------------------------------------------------------------------------------
WMBC
Quoted Prices in
Active Markets for Significant Other Significant
Asset Description Identical Assets Observable Inputs Unobservable Inputs Total
(Level 1) (Level 2) (Level 3)
- --------------------------------------------------------------------------------------------------------------------------------
Total Investments $34,741,719 $ - $ - $34,741,719
------------------------------------------------------------------------------------------------
WIBC
Quoted Prices in
Active Markets for Significant Other Significant
Assset Description Identical Assets Observable Inputs Unobservable Inputs Total
(Level 1) (Level 2) (Level 3)
------------------------------------------------------------------------------------------------
Common Stocks $61,935,024 $ - $ - $61,935,024
------------------------------------------------------------------------------------------------
Short-Term Investments 6,274,660 $ - $ - 6,274,660
------------------------------------------------------------------------------------------------
Total Investments $68,209,684 $ - $ - $68,209,684
- --------------------------------------------------------------------------------------------------------------------------------
The level classification by major category of investments is the same as the
category presentation in the Portfolio of Investments.
The Fund held no investments or other financial instruments as of December 31,
2008 whose fair value was determined using Level 3 inputs.
12. Review for Subsequent Events
----------------------------
In connection with the preparation of the financial statements of the Funds as
of and for the six months ended June 30, 2009, events and transactions
subsequent to June 30, 2009 through August 18, 2009, the date the financial
statements were issued, have been evaluated by the Funds' management for
possible adjustment and/or disclosure. Management has not identified any
subsequent events requiring financial statement disclosure as of the date these
financial statements were issued.
WRIGHT TOTAL RETURN BOND FUND (WTRB)
- -------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS - AS OF JUNE 30, 2009 (UNAUDITED)
Face Coupon Maturity
Amount Description Rate Date Value
- --------------------------------------------------------------------------------------------------------------------------------
ASSET-BACKED SECURITIES - 3.4%
$ 155,000 AEP Texas Central Transition Funding LLC,
Series 2006-A, Class A2 4.980% 07/01/13 $ 162,223
270,000 Citibank Credit Card Issuance Trust,
Series 2009-A1, Class A1 2.069% (1) 03/17/14 272,370
145,000 Harley-Davidson Motorcycle Trust,
Series 2009-1, Class A4 4.550% 01/01/17 146,224
180,000 PSE&G Transition Funding LLC,
Series 2001-1, Class A7 6.750% 06/15/16 200,486
------------
Total Asset-Backed Securities (identified cost, $762,104) $ 781,303
------------
COMMERCIAL MORTGAGE-BACKED SECURITIES - 7.6%
$ 220,000 Citigroup Commercial Mortgage Trust
Series 2004-C2, Class A5 4.733% 10/15/41 $ 187,277
285,000 CS First Boston Mortgage Securities Corp.,
Series 2003-C3, Class A5 3.936% 05/15/38 257,736
330,000 JPMorgan Chase Commercial Mortgage Securities Corp.,
Series 2004-C3, Class A5 4.878% 01/15/42 277,568
265,000 Lehman Brothers UBS, Series 2006-C6, Class A4 5.372% 09/15/39 215,546
270,000 Merrill Lynch Mortgage Trust, Series 2005-LC1,
Class A4 5.291% 01/12/44 229,317
420,000 Merrill Lynch/Countrywide Commercial Mortgage Trust,
Series 2006-2, Class A4 5.909% (1) 06/12/46 346,303
108,214 Salomon Brothers Mortgage Securities VII,
Series 2002-KEY2, Class A2 4.467% 03/18/36 107,285
128,991 Wells Fargo Mortgage Backed Securities Trust,
Series 2004-K, Class 1A2 4.472% 07/25/34 116,198
------------
Total Commercial Mortgage-Backed Securities (identified cost, $1,977,800) $ 1,737,230
------------
NON-AGENCY MORTGAGE-BACKED SECURITIES - 0.3%
$ 227,900 First Horizon Alternative Mortgage Securities,
Series 2005-AA10, Class 1A2 5.700% (1) 12/25/35 $ 76,215
------------
Total Non-Agency Mortgage-Backed Securities (identified cost, $227,900) $ 76,215
------------
CORPORATE BONDS - 37.3%
AEROSPACE -- 0.5%
- -----------------
$ 115,000 Lockheed Martin Corp. 8.200% 12/01/09 $ 117,958
AUTOMOBILE -- 0.5%
- ------------------
$ 110,000 PACCAR, Inc. 6.875% 02/15/14 $ 120,589
BANKS & MISCELLANEOUS FINANCIAL-- 5.1%
- --------------------------------------
$ 60,000 American Express Credit Corp. 7.300% 08/20/13 $ 62,438
115,000 Citigroup, Inc. 6.125% 11/21/17 100,986
110,000 Credit Suisse USA, Inc. 6.125% 11/15/11 117,836
115,000 Goldman Sachs Group, Inc. (The) 6.150% 04/01/18 112,148
235,000 HSBC Finance Corp. 6.375% 10/15/11 240,425
110,000 JPMorgan Chase & Co. 6.300% 04/23/19 110,841
125,000 Merrill Lynch & Co., Inc. 6.050% 05/16/16 112,076
100,000 Morgan Stanley 5.300% 03/01/13 101,370
55,000 PNC Funding Corp. 2.300% 06/22/12 55,487
55,000 SunTrust Banks, Inc. 6.000% 09/11/17 49,872
110,000 Wells Fargo & Co. 4.375% 01/31/13 111,038
CABLE TV-- 1.2%
- ---------------
$ 100,000 Comcast Cable Communications Holdings 5.875% 02/15/18 $ 101,538
125,000 Time Warner, Inc. 5.875% 11/15/16 123,370
50,000 Time Warner Cable, Inc. 8.250% 04/01/19 56,828
CHEMICALS -- 0.5%
- -------------------
$ 100,000 Lubrizol Corp. 8.875% 02/01/19 $ 116,369
COMMUNICATIONS EQUIPMENT-- 0.6%
- -------------------------------
$ 140,000 Harris Corp. 5.000% 10/01/15 $ 132,229
COMPUTERS & PERIPHERALS-- 0.7%
- ------------------------------
$ 30,000 Dell, Inc. 5.625% 04/15/14 $ 31,717
105,000 International Business Machines Corp. 7.625% 10/15/18 125,720
DIVERSIFIED FINANCIALS-- 5.4%
- -----------------------------
$ 240,000 Ameriprise Financial, Inc. 5.350% 11/15/10 $ 239,636
55,000 Capital One Financial Corp. 7.375% 05/23/14 56,773
110,000 Daimler Finance North America LLC 6.500% 11/15/13 111,924
225,000 General Electric Capital Corp. 6.750% 03/15/32 202,537
90,000 Genworth Global Funding Trusts 5.200% 10/08/10 87,715
245,000 International Lease Finance Corp. 5.875% 05/01/13 185,722
110,000 John Deere Capital Corp. 5.250% 10/01/12 116,281
210,000 National Rural Utilities Cooperative Finance Corp. 7.250% 03/01/12 229,509
DIVERSIFIED MANUFACTURING-- 0.8%
- --------------------------------
$ 110,000 Honeywell International, Inc. 3.875% 02/15/14 $ 112,515
55,000 Tyco International Finance SA 8.500% 01/15/19 61,085
ELECTRIC UTILITIES-- 3.6%
- -------------------------
$ 115,000 American Electric Power 5.250% 06/01/15 $ 113,016
110,000 Consolidated Edison Co. of New York, Inc. 7.125% 12/01/18 125,180
90,000 Dominion Resources, Inc. 6.300% 03/15/33 90,122
100,000 Duke Cap Corp. 7.500% 10/01/09 101,136
115,000 FPL Group Capital, Inc. 7.300% (1) 09/01/67 97,892
55,000 Hawaiian Electric Industries, Inc. 6.141% 08/15/11 56,412
50,000 Pacific Gas & Electric Co. 8.250% 10/15/18 61,120
115,000 PSI Energy, Inc. 5.000% 09/15/13 119,018
60,000 Public Service Electric & Gas Co. 5.300% 05/01/18 62,809
FOOD - RETAIL-- 0.8%
- --------------------
$ 115,000 Kraft Foods, Inc. 6.000% 02/11/13 $ 122,615
50,000 Safeway, Inc. 6.500% 03/01/11 52,975
FOOD, BEVERAGE & TOBACCO-- 2.8%
- -------------------------------
$ 55,000 Altria Group, Inc. 9.700% 11/10/18 $ 63,154
115,000 Coca-Cola Co. (The) 3.625% 03/15/14 116,433
55,000 ConAgra Foods, Inc. 5.875% 04/15/14 58,370
55,000 Diageo Capital PLC 7.375% 01/15/14 62,291
55,000 General Mills, Inc. 6.000% 02/15/12 59,249
40,000 PepsiAmericas, Inc. 4.375% 02/15/14 40,332
100,000 PepsiCo, Inc. 7.900% 11/01/18 121,869
105,000 Philip Morris International, Inc. 6.875% 03/17/14 118,594
HOUSEHOLD & PERSONAL PRODUCTS-- 0.5%
- ------------------------------------
$ 115,000 Avon Products, Inc. 5.625% 03/01/14 $ 121,680
INSURANCE -- 2.2%
- -----------------
$ 130,000 Fund American Cos., Inc. 5.875% 05/15/13 $ 122,562
125,000 MetLife, Inc. 5.000% 06/15/15 119,245
55,000 Principal Financial Group, Inc. 8.875% 05/15/19 57,835
200,000 St. Paul Travelers 5.500% 12/01/15 205,035
MEDIA -- 0.4%
- --------------
$ 95,000 McGraw-Hill Cos. Inc. (The) 5.900% 11/15/17 $ 91,096
MEDICAL -- 2.8%
- ----------------
$ 245,000 Bristol-Myers Squibb Co. 5.875% 11/15/36 $ 253,133
40,000 McKesson Corp. 6.500% 02/15/14 42,719
100,000 Medtronic, Inc. 4.500% 03/15/14 103,695
115,000 WellPoint, Inc. 5.875% 06/15/17 112,727
115,000 Wyeth 5.500% 02/01/14 123,202
MINING -- 0.4%
- --------------
$ 80,000 Barrick Gold Financeco LLC 6.125% 09/15/13 $ 85,921
OIL & GAS-- 3.9%
- ----------------
$ 105,000 Baker Hughes, Inc. 7.500% 11/15/18 $ 123,174
110,000 Canadian Natural Resources, Ltd. 5.700% 05/15/17 111,408
120,000 EnCana Corp. 5.900% 12/01/17 123,220
80,000 Halliburton Co. 6.700% 09/15/38 86,095
35,000 Marathon Oil Corp. 6.500% 02/15/14 37,454
100,000 Sempra Energy 6.000% 02/01/13 102,300
50,000 Smith International, Inc. 9.750% 03/15/19 57,848
170,000 TransCanada Pipelines, Ltd. 6.500% 08/15/18 185,269
55,000 Valero Energy Corp. 9.375% 03/15/19 62,749
RETAIL -- 0.5%
- --------------
$ 120,000 Home Depot, Inc. 5.200% 03/01/11 $ 124,263
SEMICONDUCTOR EQUIPMENT & PRODUCTS-- 0.8%
- -----------------------------------------
$ 165,000 Applied Materials, Inc. 7.125% 10/15/17 $ 171,665
TELECOMMUNICATIONS -- 2.7%
- --------------------------
$ 110,000 AT&T Wireless Services, Inc. 5.800% 02/15/19 $ 111,888
70,000 British Telecom PLC 9.625% 12/15/30 77,792
100,000 Deutsche Telekom International Finance BV 8.500% 06/15/10 105,191
120,000 France Telecom SA 7.750% 03/01/11 129,835
175,000 Verizon Global Funding Corp. 7.750% 12/01/30 195,973
TRANSPORTATION -- 0.6%
- ----------------------
$ 125,000 Burlington Northern Santa Fe Corp. 5.650% 05/01/17 $ 127,782
------------
Total Corporate Bonds (identified cost, $8,342,588) $ 8,519,875
------------
CONVERTIBLE BONDS - 0.8%
- ------------------------
$ 125,000 National City Corp. 4.000% 02/01/11 $ 123,438
65,000 Transocean, Inc. 1.500% 12/15/37 59,881
------------
Total Convertible Bonds (identified cost, $170,505) $ 183,319
------------
U.S. GOVERNMENT INTERESTS - 48.8%
AGENCY MORTGAGE-BACKED SECURITIES -- 35.0%
- ------------------------------------------
$ 240,940 FHLMC Gold Pool #A32600 5.500% 05/01/35 $ 249,596
57,007 FHLMC Gold Pool #C01646 6.000% 09/01/33 59,921
45,077 FHLMC Gold Pool #C27663 7.000% 06/01/29 48,981
144,549 FHLMC Gold Pool #C47318 7.000% 09/01/29 159,752
324,477 FHLMC Gold Pool #C66878 6.500% 05/01/32 347,856
216,139 FHLMC Gold Pool #C91046 6.500% 05/01/27 231,393
73,97 FHLMC Gold Pool #D66753 6.000% 10/01/23 76,477
12,357 FHLMC Gold Pool #E00903 7.000% 10/01/15 13,177
308,016 FHLMC Gold Pool #G01035 6.000% 05/01/29 324,626
203,595 FHLMC Gold Pool #G02478 5.500% 12/01/36 210,592
245,298 FHLMC Gold Pool #H19018 6.500% 08/01/37 260,257
131,667 FHLMC Gold Pool #N30514 5.500% 11/01/28 135,286
346,451 FHLMC Gold Pool #P00024 7.000% 09/01/32 372,955
25,907 FHLMC Gold Pool #P50031 7.000% 08/01/18 28,125
49,766 FHLMC Gold Pool #P50064 7.000% 09/01/30 54,027
115,923 FHLMC Pool #1B1291 4.998% (1) 11/01/33 119,269
530,861 FHLMC Pool #1G0233 4.998% (1) 05/01/35 549,916
101,968 FHLMC Pool #781071 5.193% (1) 11/01/33 105,827
81,000 FHLMC Pool #781804 5.054% (1) 07/01/34 83,674
41,394 FHLMC Pool #781884 5.134% (1) 08/01/34 42,871
97,373 FHLMC Pool #782862 4.999% (1) 11/01/34 100,617
301,343 FHLMC Series 1983, Class Z 6.500% 12/15/23 320,557
245,311 FHLMC Series 2044, Class PE 6.500% 04/15/28 259,728
127,414 FNMA Pool #253057 8.000% 12/01/29 139,484
32,906 FNMA Pool #254845 4.000% 07/01/13 33,616
33,223 FNMA Pool #254863 4.000% 08/01/13 33,817
24,135 FNMA Pool #479477 6.000% 01/01/29 25,527
21,234 FNMA Pool #489357 6.500% 03/01/29 22,870
24,431 FNMA Pool #535332 8.500% 04/01/30 26,680
43,033 FNMA Pool #545782 7.000% 07/01/32 47,405
38,248 FNMA Pool #597396 6.500% 09/01/31 41,111
60,799 FNMA Pool #725866 4.500% 09/01/34 60,960
146,775 FNMA Pool #738630 5.500% 11/01/33 152,324
376,189 FNMA Pool #745467 5.774% (1) 04/01/36 394,445
515,932 FNMA Pool #745755 5.000% 12/01/35 527,520
190,595 FNMA Pool #747529 4.500% 10/01/33 191,248
671,330 FNMA Pool #781893 4.500% 11/01/31 677,722
60,955 FNMA Pool #809888 4.500% 03/01/35 61,059
138,252 FNMA Pool #906455 5.978% (1) 01/01/37 144,329
195,805 GNMA Pool #374892 7.000% 02/15/24 212,979
41,482 GNMA Pool #376400 6.500% 02/15/24 44,277
61,211 GNMA Pool #379982 7.000% 02/15/24 66,580
180,910 GNMA Pool #393347 7.500% 02/15/27 198,443
67,386 GNMA Pool #410081 8.000% 08/15/25 74,490
35,560 GNMA Pool #427199 7.000% 12/15/27 38,780
14,411 GNMA Pool #436214 6.500% 02/15/13 15,404
100,338 GNMA Pool #448490 7.500% 03/15/27 110,062
50,886 GNMA Pool #458762 6.500% 01/15/28 54,967
62,531 GNMA Pool #460726 6.500% 12/15/27 67,345
15,976 GNMA Pool #488924 6.500% 11/15/28 17,257
14,844 GNMA Pool #510706 8.000% 11/15/29 16,793
67,365 GNMA Pool #581536 5.500% 06/15/33 70,012
141,689 GNMA II Pool #2630 6.500% 08/20/28 152,636
6,423 GNMA II Pool #2909 8.000% 04/20/30 7,245
16,202 GNMA II Pool #2972 7.500% 09/20/30 17,678
6,011 GNMA II Pool #2973 8.000% 09/20/30 6,780
64,474 GNMA II Pool #3095 6.500% 06/20/31 69,407
U.S. GOVERNMENT AGENCIES-- 3.7%
- -------------------------------
$ 225,000 Citigroup, Inc. (FDIC guaranteed) 2.875% 12/09/11 $ 231,591
200,000 Federal National Mortgage Association 6.250% 05/15/29 235,512
145,000 JPMorgan Chase & Co. (FDIC guaranteed) 3.125% 12/01/11 150,082
210,000 Regions Bank (FDIC guaranteed) 3.250% 12/09/11 218,016
U.S. TREASURIES-- 10.1%
- -----------------------
$ 220,000 U.S. Treasury Notes 4.375% 12/15/10 $ 231,576
180,000 U.S. Treasury Notes 5.000% 08/15/11 194,738
950,000 U.S. Treasury Notes 3.875% 02/15/13 1,013,012
100,000 U.S. Treasury Notes 4.250% 11/15/13 108,094
950,000 U.S. Treasury Strip 0.000% 02/15/18 683,392
150,000 U.S. Treasury Strip 0.000% 02/15/27 68,013
------------
Total U.S. Government Interests (identified cost, $10,762,099) $11,110,758
------------
TOTAL INVESTMENTS (identified cost, $22,242,996)-- 98.2% $22,408,700
OTHER ASSETS, LESS LIABILITIES-- 1.8% 417,955
------------
NET ASSETS-- 100.0% $22,826,655
============
FDIC - Federal Deposit Insurance Corporation
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
GNMA - Government National Mortgage Association
(1) Adjustable rate security. Rate shown is the rate at period end.
See notes to financial statements
WRIGHT TOTAL RETURN BOND FUND (WTRB)
- -----------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2009 (Unaudited)
- ------------------------------------------------------------------------------
ASSETS:
Investments, at value
(identified cost $22,242,996) (Note 1A) $ 22,408,700
Cash 271,087
Receivable for investments sold 642,704
Receivable for fund shares sold 47,329
Interest receivable 216,102
Prepaid expenses 17,892
------------
Total assets $ 23,603,814
------------
LIABILITIES:
Payable for investments purchased $ 734,377
Payable for fund shares reacquired 8,988
Distributions payable 17,284
Accrued expenses and other liabilities 16,510
------------
Total liabilities $ 777,159
------------
NET ASSETS $ 22,826,655
============
NET ASSETS CONSIST OF:
Paid-in capital $ 25,110,860
Accumulated net realized loss on
investments (2,397,603)
Accumulated distributions in excess of
net investment income (52,306)
Unrealized appreciation of investments 165,704
------------
Net assets applicable to outstanding shares $ 22,826,655
============
SHARES OF BENEFICIAL INTEREST OUTSTANDING 1,856,297
============
NET ASSET VALUE, OFFERING PRICE, AND
REDEMPTION PRICE PER SHARE OF
BENEFICIAL INTEREST $ 12.30
============
See notes to financial statements
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
INVESTMENT INCOME (Note 1C)
Interest income $ 636,680
------------
Expenses -
Investment adviser fee (Note 3) $ 50,772
Administrator fee (Note 3) 7,898
Compensation of Trustees who are not employees
of the investment adviser or administrator 9,752
Custodian fee (Note 1F) 35,262
Distribution expenses (Note 4) 28,207
Transfer and dividend disbursing agent fees 9,833
Printing 454
Shareholder communications 1,446
Audit services 16,264
Legal services 437
Registration costs 12,419
Miscellaneous 3,508
------------
Total expenses $ 176,252
------------
Deduct -
Waiver and/or reimbursement by the principal
underwriter and/or investment adviser
(Note 3 and 4) $ (97,267)
Reduction of custodian fee (Note 1F) (8)
------------
Total deductions $ (97,275)
------------
Net expenses $ 78,977
------------
Net investment income $ 557,703
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized loss on investment transactions $ (254,766)
Net change in unrealized appreciation
(depreciation) on investments $ 853,716
------------
Net realized and unrealized gain on
investments $ 598,950
------------
Net increase in net assets from operations $ 1,156,653
============
See notes to financial statements
WRIGHT TOTAL RETURN BOND FUND (WTRB)
- ------------------------------------------------------------------------------
Six Months Ended Year Ended,
STATEMENTS OF CHANGES IN NET ASSETS June 30, 2009 December 31, 2008
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
INCREASE (DECREASE) IN NET ASSETS:
From operations -
Net investment income $ 557,703 $ 1,114,134
Net realized gain (loss) on investment transactions (254,766) 224,053
Net change in unrealized appreciation (depreciation) on investments 853,716 (922,629)
-------------- --------------
Net increase in net assets from operations $ 1,156,653 $ 415,558
-------------- --------------
Distributions to shareholders (Note 2) -
From net investment income $ (593,701) $ (1,166,826)
-------------- --------------
Total distributions $ (593,701) $ (1,166,826)
-------------- --------------
Net decrease in net assets from fund share transactions (Note 6) $ (998,700) $ (975,127)
-------------- --------------
Net decrease in net assets $ (435,748) $ (1,726,395)
NET ASSETS:
At beginning of period 23,262,403 24,988,798
-------------- --------------
At end of period $ 22,826,655 $ 23,262,403
============== ==============
ACCUMULATED DISTRIBUTIONS IN EXCESS OF NET INVESTMENT
INCOME INCLUDED IN NET ASSETS AT END OF PERIOD $ (52,306) $ (16,308)
============== ==============
See notes to financial statements
WRIGHT TOTAL RETURN BOND FUND (WTRB)
- -------------------------------------------------------------------------------
Six Months
Ended June 30 Year Ended December 31,
-----------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 2009(3) 2008(3) 2007(3) 2006 2005 2004
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Net asset value, beginning of period $ 11.990 $ 12.390 $ 12.290 $ 12.430 $ 12.770 $ 12.870
--------- --------- --------- --------- --------- ---------
Income (loss) from investment operations:
Net investment income(1) $ 0.295 $ 0.573 $ 0.558 $ 0.483 $ 0.465 $ 0.453
Net realized and unrealized gain (loss) 0.329 (0.373) 0.115 (0.082) (0.271) (0.011)
--------- --------- --------- --------- --------- ---------
Total income from investment operations $ 0.624 $ 0.200 $ 0.673 $ 0.401 $ 0.194 $ 0.442
--------- --------- --------- --------- --------- ---------
Less distributions:
From net investment income $ (0.314) $ (0.600) $ (0.573) $ (0.541) $ (0.534) $ (0.542)
--------- --------- --------- --------- --------- ---------
Total distributions $ (0.314) $ (0.600) $ (0.573) $ (0.541) $ (0.534) $ (0.542)
--------- --------- --------- --------- --------- ---------
Net asset value, end of period $ 12.300 $ 11.990 $ 12.390 $ 12.290 $ 12.430 $ 12.770
========= ========= ========= ========= ========= =========
Total Return(2) 5.29%(5) 1.69% 5.64% 3.34% 1.54% 3.52%
========= ========= ========= ========= ========= =========
Ratios/Supplemental Data(1):
Net assets, end of period (000 omitted) $ 22,827 $ 23,262 $ 24,989 $ 30,866 $ 41,288 $ 38,213
Ratios (As a percentage of average
daily net assets):
Net expenses 0.70%(4) 0.71% 0.87% 0.99% 0.98% 0.96%
Net expenses after custodian fee reduction 0.70%(4) 0.70% 0.85% 0.95% 0.95% 0.95%
Net investment income 4.94%(4) 4.73% 4.56% 3.96% 3.66% 3.58%
Portfolio turnover rate 33%(5) 125% 119% 90% 86% 64%
- --------------------------------------------------------------------------------------------------------------------------------
(1) For the six months ended June 30, 2009 and for the years ended December 31,
2008, 2007, 2006, 2005 and 2004, the operating expenses of the Fund were
reduced by a waiver of fees and/or an allocation of expenses to the
principal underwriter and/or investment adviser. Had such action not been
undertaken, net investment income per share and the ratios would have been
as follows:
2009 2008 2007 2006 2005 2004
- --------------------------------------------------------------------------------------------------------------------------------
Net investment income per share $ 0.243 $ 0.475 $ 0.490 $ 0.453 $ 0.439 $ 0.429
========= ========= ========= ========= ========= =========
Ratios (As a percentage of average daily net assets):
Expenses 1.56%(4) 1.52% 1.41% 1.23% 1.18% 1.18%
========= ========= ========= ========= ========= =========
Expenses after custodian fee reduction 1.56%(4) 1.51% 1.38% 1.19% 1.15% 1.17%
========= ========= ========= ========= ========= =========
Net investment income 4.08%(4) 3.93% 4.03% 3.72% 3.46% 3.36%
========= ========= ========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the reinvestment date.
(3) Certain per share amounts are based on average shares outstanding.
(4) Annualized.
(5) Not annualized.
See notes to financial statements
WRIGHT CURRENT INCOME FUND (WCIF)
- -------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS - AS OF JUNE 30, 2009 (UNAUDITED)
Face Coupon Maturity
Amount Description Rate Date Value
- --------------------------------------------------------------------------------------------------------------------------------
NON-AGENCY MORTGAGE-BACKED SECURITIES -- 2.8%
$ 208,493 Bear Stearns Adj. Rate Mortgage Trust,
Series 2003-4, Class 3A1 4.966%(1) 07/25/33 $ 189,012
664,842 Chase Mortgage Finance Corporation,
Series 2003-S13, Class A16 5.000% 11/25/33 577,757
431,621 Countrywide Home Loans, Series 2006-J1, Class 3A1 6.000% 02/25/36 313,898
------------
Total Non-Agency Mortgage-Backed Securities (identified cost, $1,252,099)-- 2.8% $ 1,080,667
------------
AGENCY MORTGAGE-BACKED SECURITIES -- 96.3%
$ 35,273 FHLMC Gold Pool #C00548 7.000% 08/01/27 $ 38,503
107,502 FHLMC Gold Pool #C00778 7.000% 06/01/29 116,813
178,560 FHLMC Gold Pool #C47318 7.000% 09/01/29 197,340
299,487 FHLMC Gold Pool #C90580 6.000% 09/01/22 316,104
73,587 FHLMC Gold Pool #D81642 7.500% 08/01/27 80,328
137,514 FHLMC Gold Pool #D82572 7.000% 09/01/27 150,105
73,887 FHLMC Gold Pool #E00678 6.500% 06/01/14 77,656
77,050 FHLMC Gold Pool #E00721 6.500% 07/01/14 80,990
71,662 FHLMC Gold Pool #E81704 8.500% 05/01/15 81,635
397,297 FHLMC Gold Pool #E88471 7.500% 01/01/17 424,027
120,029 FHLMC Gold Pool #E90181 6.500% 06/01/17 127,179
534,437 FHLMC Gold Pool #G02478 5.500% 12/01/36 552,803
184,524 FHLMC Pool #2176 OJ 7.000% 08/15/29 195,787
105,105 FHLMC Pool #2201 C 8.000% 11/15/29 113,602
225,209 FHLMC Pool #2259 ZM 7.000% 10/15/30 242,228
83,060 FHLMC Pool #845830 4.800%(1) 07/01/24 85,126
187,842 FHLMC Series 4, Class D 8.000% 12/25/22 203,540
307,846 FHLMC Series 15, Class L 7.000% 07/25/23 330,175
106,961 FHLMC Series 23, Class KZ 6.500% 11/25/23 115,029
714,384 FNMA Pool #252034 7.000% 09/01/28 780,304
82,396 FNMA Pool #254305 6.500% 05/01/22 88,656
10,040 FNMA Pool #254505 5.000% 11/01/09 10,153
141,597 FNMA Pool #255068 6.000% 01/01/24 149,550
876,250 FNMA Pool #256600 5.500% 02/01/27 910,350
201,548 FNMA Pool #313953 7.000% 12/01/17 221,520
166,828 FNMA Pool #532204 7.000% 02/01/20 183,087
75,087 FNMA Pool #535131 6.000% 03/01/29 79,417
114,201 FNMA Pool #535817 7.000% 04/01/31 125,177
403,127 FNMA Pool #673315 5.500% 11/01/32 418,744
1,368,858 FNMA Pool #725027 5.000% 11/01/33 1,400,673
757,771 FNMA Pool #725419 4.500% 10/01/33 760,368
62,040 FNMA Pool #733750 6.310% 10/01/32 66,193
474,725 FNMA Pool #735861 6.500% 09/01/33 511,006
235,408 FNMA Pool #745630 5.500% 01/01/29 245,705
910,908 FNMA Pool #756831 5.000% 12/01/18 953,976
284,114 FNMA Pool #801357 5.500% 08/01/34 295,121
304,061 FNMA Pool #813839 6.000% 11/01/34 320,838
405,004 FNMA Pool #871394 7.000% 04/01/21 429,974
388,173 FNMA Pool #888129 5.500% 02/01/37 401,573
636,022 FNMA Pool #888339 4.500% 04/01/37 637,109
1,158,618 FNMA Series 2002-T4, Class A2 7.000% 12/25/41 1,240,684
272,075 FNMA Series 2003-W3, Class 2A5 5.356% 06/25/42 281,164
367,266 FNMA Series G93-5, Class Z 6.500% 02/25/23 396,010
94,849 GNMA I Pool #448970 8.000% 08/15/27 107,048
411,204 GNMA I Pool #487108 6.000% 04/15/29 432,648
715,679 GNMA I Pool #503405 6.500% 04/15/29 772,626
253,405 GNMA I Pool #509930 5.500% 06/15/29 263,918
419,360 GNMA I Pool #509965 5.500% 06/15/29 436,757
163,147 GNMA I Pool #623190 6.000% 12/15/23 171,651
568,173 GNMA I Pool #675363 6.000% 01/15/35 593,896
1,516,769 GNMA I Pool #697850 5.000% 02/15/39 1,549,948
463,943 GNMA I Pool #704107 5.000% 12/15/23 486,215
277,245 GNMA I Pool #780492 7.000% 09/15/24 301,424
154,133 GNMA I Pool #782375 6.000% 06/15/18 164,276
26,293 GNMA II Pool #723 7.500% 01/20/23 28,767
2,991 GNMA II Pool #1596 9.000% 04/20/21 3,233
37,364 GNMA II Pool #2268 7.500% 08/20/26 40,819
130,779 GNMA II Pool #2442 6.500% 06/20/27 140,887
4,632 GNMA II Pool #2855 8.500% 12/20/29 5,161
214,264 GNMA II Pool #3284 5.500% 09/20/32 221,415
511,675 GNMA II Pool #3388 4.500% 05/20/33 513,391
109,958 GNMA II Pool #3401 4.500% 06/20/33 110,326
166,121 GNMA II Pool #3554 4.500% 05/20/34 166,449
843,969 GNMA II Pool #3556 5.500% 05/20/34 871,214
481,820 GNMA II Pool #3689 4.500% 03/20/35 482,112
214,159 GNMA II Pool #4149 7.500% 05/20/38 229,136
901,607 GNMA II Pool #4308 5.000% 12/20/38 913,863
486,476 GNMA II Pool #4412 5.000% 04/20/39 494,609
165,645 GNMA II Pool #575787 5.760% 03/20/33 171,593
127,039 GNMA II Pool #601255 6.310% 01/20/33 134,927
108,010 GNMA II Pool #608120 6.310% 01/20/33 114,717
312,370 GNMA II Pool #610116 5.760% 04/20/33 323,586
71,773 GNMA II Pool #610143 5.760% 06/20/33 74,350
309,044 GNMA II Pool #612121 5.760% 07/20/33 320,141
332,937 GNMA II Pool #648541 6.000% 10/20/35 346,201
88,504 GNMA II Pool #81161(1) 5.500% 11/20/34 90,771
1,285 GNMA Pool #176992 8.000% 11/15/16 1,404
2,025 GNMA Pool #177784 8.000% 10/15/16 2,211
10,060 GNMA Pool #192357 8.000% 04/15/17 11,025
4,617 GNMA Pool #194057 8.500% 04/15/17 5,014
2,175 GNMA Pool #194287 9.500% 03/15/17 2,383
1,124 GNMA Pool #196063 8.500% 03/15/17 1,220
6,247 GNMA Pool #211231 8.500% 05/15/17 6,783
1,191 GNMA Pool #212601 8.500% 06/15/17 1,293
1,638 GNMA Pool #220917 8.500% 04/15/17 1,779
5,769 GNMA Pool #223348 10.000% 08/15/18 6,302
5,405 GNMA Pool #228308 10.000% 01/15/19 5,905
2,524 GNMA Pool #230223 9.500% 04/15/18 2,770
3,607 GNMA Pool #260999 9.500% 09/15/18 3,958
5,124 GNMA Pool #263439 10.000% 02/15/19 5,571
1,338 GNMA Pool #265267 9.500% 08/15/20 1,472
1,624 GNMA Pool #266983 10.000% 02/15/19 1,766
756 GNMA Pool #286556 9.000% 03/15/20 821
2,005 GNMA Pool #301366 8.500% 06/15/21 2,175
4,398 GNMA Pool #302933 8.500% 06/15/21 4,772
10,384 GNMA Pool #308792 9.000% 07/15/21 11,268
1,806 GNMA Pool #314222 8.500% 04/15/22 1,955
3,279 GNMA Pool #315187 8.000% 06/15/22 3,595
10,221 GNMA Pool #315754 8.000% 01/15/22 11,206
24,804 GNMA Pool #319441 8.500% 04/15/22 26,856
7,590 GNMA Pool #325165 8.000% 06/15/22 8,321
8,619 GNMA Pool #335950 8.000% 10/15/22 9,450
164,601 GNMA Pool #346987 7.000% 12/15/23 178,926
66,419 GNMA Pool #352001 6.500% 12/15/23 70,594
24,971 GNMA Pool #352110 7.000% 08/15/23 27,144
48,018 GNMA Pool #368238 7.000% 12/15/23 52,197
47,736 GNMA Pool #372379 8.000% 10/15/26 52,671
57,419 GNMA Pool #396537 7.490% 03/15/25 62,925
42,925 GNMA Pool #399726 7.490% 05/15/25 47,041
131,061 GNMA Pool #399788 7.490% 09/15/25 143,628
29,026 GNMA Pool #399958 7.490% 02/15/27 31,829
28,574 GNMA Pool #399964 7.490% 04/15/26 31,321
59,296 GNMA Pool #410215 7.500% 12/15/25 65,003
6,703 GNMA Pool #414736 7.500% 11/15/25 7,348
36,240 GNMA Pool #420707 7.000% 02/15/26 39,507
19,873 GNMA Pool #421829 7.500% 04/15/26 21,790
10,851 GNMA Pool #431036 8.000% 07/15/26 11,973
14,493 GNMA Pool #431612 8.000% 11/15/26 15,991
28,992 GNMA Pool #438004 7.490% 11/15/26 31,779
8,216 GNMA Pool #442190 8.000% 12/15/26 9,065
14,151 GNMA Pool #449176 6.500% 07/15/28 15,286
22,397 GNMA Pool #462623 6.500% 03/15/28 24,194
254,674 GNMA Pool #471369 5.500% 05/15/33 264,682
22,211 GNMA Pool #475149 6.500% 05/15/13 23,743
136,964 GNMA Pool #489377 6.375% 03/15/29 146,886
37,440 GNMA Pool #524811 6.375% 09/15/29 40,152
27,536 GNMA Pool #538314 7.000% 02/15/32 29,898
262,642 GNMA Pool #595606 6.000% 11/15/32 276,092
30,557 GNMA Pool #602377 4.500% 06/15/18 31,893
36,324 GNMA Pool #603377 4.500% 01/15/18 37,912
166,545 GNMA Pool #616829 5.500% 01/15/25 176,461
467,597 GNMA Pool #624600 6.150% 01/15/34 492,306
97,430 GNMA Pool #640940 5.500% 05/15/35 101,015
90,588 GNMA Pool #658267 6.500% 02/15/22 96,701
1,981,678 GNMA Pool #711856 5.500% 04/15/39 2,044,534
46,922 GNMA Pool #780429 7.500% 09/15/26 51,444
159,477 GNMA Pool #780977 7.500% 12/15/28 174,887
404,181 GNMA Pool #781120 7.000% 12/15/29 441,342
1,057,952 GNMA Series 1999-4, Class ZB 6.000% 02/20/29 1,131,571
257,213 GNMA Series 1999-25, Class TB 7.500% 07/16/29 280,794
397,045 GNMA Series 2000-14, Class PD 7.000% 02/16/30 428,396
334,026 GNMA Series 2001-4, Class PM 6.500% 03/20/31 357,081
189,310 GNMA Series 2002-7, Class PG 6.500% 01/20/32 201,604
418,760 GNMA Series 2002-22, Class GF 6.500% 03/20/32 448,790
288,641 GNMA Series 2002-40, Class UK 6.500% 06/20/32 309,465
230,082 GNMA Series 2002-45, Class QE 6.500% 06/20/32 246,317
1,588,814 GNMA Series 2002-47, Class PG 6.500% 07/16/32 1,704,460
427,616 Vendee Mortgage Trust, Series 1996-1, Class 1Z 6.750% 02/15/26 456,771
347,925 Vendee Mortgage Trust, Series 1998-1, Class 2E 7.000% 09/15/27 376,229
------------
Total Agency Mortgage-Backed Securities (identified cost, $35,659,038) $36,967,310
------------
TOTAL INVESTMENTS (identified cost, $36,911,137)-- 99.1% $38,047,977
------------
OTHER ASSETS, LESS LIABILITIES-- 0.9% 337,282
------------
NET ASSETS-- 100.0% $38,385,259
============
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
GNMA - Government National Mortgage Association
(1) Adjustable rate security. Rate shown is the rate at period end.
See notes to financial statements
WRIGHT CURRENT INCOME FUND (WCIF)
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
June 30, 2009 (Unaudited)
- ------------------------------------------------------------------------------
ASSETS:
Investments, at value
(identified cost $36,911,137) (Note 1A) $ 38,047,977
Cash 1,427,082
Receivable for investments sold 2,213,372
Receivable for fund shares sold 25,591
Interest receivable 183,440
Prepaid expenses 22,825
------------
Total assets $ 41,920,287
------------
LIABILITIES:
Payable for investments purchased $ 3,450,969
Payable for fund shares reacquired 13,989
Distributions payable 54,267
Accrued expenses and other liabilities 15,803
------------
Total liabilities $ 3,535,028
------------
NET ASSETS $ 38,385,259
============
NET ASSETS CONSIST OF:
Paid-in capital $ 38,068,570
Accumulated net realized loss on investments (1,059,055)
Accumulated undistributed net
investment income 238,904
Unrealized appreciation of investments 1,136,840
------------
Net assets applicable to outstanding shares $ 38,385,259
============
SHARES OF BENEFICIAL INTEREST OUTSTANDING 3,928,854
============
NET ASSET VALUE, OFFERING PRICE, AND
REDEMPTION PRICE PER SHARE OF
BENEFICIAL INTEREST $ 9.77
============
See notes to financial statements
STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 2009 (Unaudited)
- -------------------------------------------------------------------------------
INVESTMENT INCOME (Note 1C)
Interest income $ 1,234,986
Other income 2,386
------------
Total investment income $ 1,237,372
------------
Expenses -
Investment adviser fee (Note 3) $ 87,825
Administrator fee (Note 3) 17,565
Compensation of Trustees who are not employees
of the investment adviser or administrator 9,751
Custodian fee (Note 1F) 35,263
Distribution expenses (Note 4) 48,792
Transfer and dividend disbursing agent fees 10,085
Printing 1,495
Shareholder communications 2,214
Audit services 19,020
Legal services 1,405
Registration costs 9,540
Miscellaneous 3,991
------------
Total expenses $ 246,946
------------
Deduct -
Waiver and/or reimbursement by the principal
underwriter and/or investment adviser
(Note 3 and 4) $ (64,713)
Reduction of custodian fee (Note 1F) (38)
------------
Total deductions $ (64,751)
------------
Net expenses $ 182,195
------------
Net investment income $ 1,055,177
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain on investment
transactions $ 438,827
Net change in unrealized appreciation
(depreciation)
on investments (278,317)
------------
Net realized and unrealized gain
on investments $ 160,510
------------
Net increase in net assets from operations $ 1,215,687
============
See notes to financial statements
WRIGHT CURRENT INCOME FUND (WCIF)
- -------------------------------------------------------------------------------
Six Months Ended Year Ended,
STATEMENTS OF CHANGES IN NET ASSETS June 30, 2009 December 31, 2008
--------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
INCREASE (DECREASE) IN NET ASSETS:
From operations -
Net investment income $ 1,055,177 $ 1,845,902
Net realized gain (loss) on investment transactions 438,827 (20,196)
Net change in unrealized appreciation (depreciation) on investments (278,317) 476,154
-------------- --------------
Net increase in net assets from operations $ 1,215,687 $ 2,301,860
-------------- --------------
Distributions to shareholders (Note 2)
From net investment income $ (936,009) $ (1,894,445)
-------------- --------------
Total distributions $ (936,009) $ (1,894,445)
-------------- --------------
Net decrease in net assets from fund share transactions (Note 6) $ (700,628) $ (1,300,367)
-------------- --------------
Net decrease in net assets $ (420,950) $ (892,952)
NET ASSETS:
At beginning of period 38,806,209 39,699,161
-------------- --------------
At end of period $ 38,385,259 $ 38,806,209
============== ==============
ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME INCLUDED
IN NET ASSETS AT END OF PERIOD $ 238,904 $ 119,736
============== ==============
See notes to financial statements
WRIGHT CURRENT INCOME FUNd (WCIF)
- -------------------------------------------------------------------------------
Six Months
Ended June 30 Year Ended December 31,
-----------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS 2009(3) 2008(3) 2007(3) 2006 2005 2004
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Net asset value, beginning of period $ 9.700 $ 9.590 $ 9.510 $ 9.610 $ 9.890 $ 10.490
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from investment operations:
Net investment income(1) $ 0.262 $ 0.447 $ 0.455 $ 0.427 $ 0.400 $ 0.447
Net realized and unrealized gain (loss) 0.040 0.122 0.078 (0.063) (0.230) (0.112)
---------- ---------- ---------- ---------- ---------- ----------
Total income from investment operations $ 0.302 $ 0.569 $ 0.533 $ 0.364 $ 0.170 $ 0.335
---------- ---------- ---------- ---------- ---------- ----------
Less distributions:
From net investment income $ (0.232) $ (0.459) $ (0.444) $ (0.447) $ (0.430) $ (0.482)
From net realized gains - - (0.009) (0.017) (0.020) (0.453)
---------- ---------- ---------- ---------- ---------- ----------
Total distributions $ (0.232) $ (0.459) $ (0.453) $ (0.464) $ (0.450) $ (0.935)
---------- ---------- ---------- ---------- ---------- ----------
Net asset value, end of period $ 9.770 $ 9.700 $ 9.590 $ 9.510 $ 9.610 $ 9.890
========== ========== ========== ========== ========== ==========
Total Return(2) 3.14%(5) 6.10% 5.77% 3.92% 1.76% 3.29%
========== ========== ========== ========== ========== ==========
Ratios/Supplemental Data(1):
Net assets, end of period (000 omitted) $ 38,385 $ 38,806 $ 39,699 $ 40,474 $ 33,861 $ 35,013
Ratios (As a percentage of average daily net assets):
Net expenses 0.93%(4) 0.96% 0.96% 0.96% 0.97% 0.97%
Net expenses after custodian fee reduction 0.93%(4) 0.95% 0.95% 0.95% 0.95% 0.95%
Net investment income 5.41%(4) 4.66% 4.80% 4.47% 4.12% 4.29%
Portfolio turnover rate 38%(5) 57% 47% 75% 103% 27%
- --------------------------------------------------------------------------------------------------------------------------------
(1) For the six months ended June 30, 2009 and for the years ended December 31,
2008, 2007, 2006, 2005 and 2004, the operating expenses of the Fund were
reduced by a waiver of fees and/or an allocation of expenses to the
principal underwriter and/or investment adviser. Had such action not been
undertaken, net investment income per share and the ratios would have been
as follows:
2009 2008 2007 2006 2005 2004
- --------------------------------------------------------------------------------------------------------------------------------
Net investment income per share $ 0.246 $ 0.420 $ 0.429 $ 0.391 $ 0.369 $ 0.410
========== ========== ========== ========== ========== ==========
Ratios (As a percentage of average daily net assets):
Expenses 1.27%(4) 1.24% 1.23% 1.31% 1.30% 1.28%
========== ========== ========== ========== ========== ==========
Expenses after custodian fee reduction 1.27%(4) 1.23% 1.22% 1.30% 1.28% 1.25%
========== ========== ========== ========== ========== ==========
Net investment income 5.07%(4) 4.38% 4.52% 4.13% 3.80% 3.99%
========== ========== ========== ========== ========== ==========
- --------------------------------------------------------------------------------------------------------------------------------
(2) Total return is calculated assuming a purchase at the net asset value on
the first day and a sale at the net asset value on the last day of each
period reported. Dividends and distributions, if any, are assumed to be
reinvested at the net asset value on the reinvestment date.
(3) Certain per share amounts are based on average shares outstanding.
(4) Annualized.
(5) Not annualized.
See notes to financial statements
WRIGHT MANAGED INCOME TRUST
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies
-------------------------------
The Wright Managed Income Trust (the Trust), issuer of Wright Total Return Bond
Fund (WTRB) series and Wright Current Income Fund (WCIF) series (collectively,
the Funds), is registered under the Investment Company Act of 1940, as amended
(the 1940 Act), as a diversified, open-end management investment company. WTRB
seeks a superior rate of total return, consisting of a high level of income plus
price appreciation. WCIF seeks a high level of current income consistent with
moderate fluctuations of principal.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
policies are in conformity with accounting principles generally accepted in the
United States of America.
A. Investment Valuations - Debt obligations, including listed securities and
securities for which quotations are readily available, will normally be valued
on the basis of reported trades or market quotations provided by third party
pricing services, when in the services' judgment, these prices are
representative of the securities' market values. For debt securities where
market quotations are not readily available, the pricing services will use
various techniques that consider factors including, but not limited to, prices
or yields of securities with similar characteristics, benchmark yields,
broker/dealer quotes, issuer spreads, as well as industry and economic events.
Short-term debt securities with a remaining maturity of sixty days or less are
generally valued at amortized cost, which approximates market value. If
short-term debt securities are acquired with a remaining maturity of more than
sixty days, they will be valued by a pricing service as described above.
Investments for which valuations or market quotations are not readily available
or are deemed unreliable are valued at fair value using methods determined in
good faith by or at the direction of the Trustees of the Funds in a manner that
most fairly reflects the security's value, or the amount that the Fund might
reasonably expect to receive for the security upon its current sale in the
ordinary course. Each such determination is based on a consideration of all
relevant factors, which are likely to vary from one pricing context to another.
These factors may include, but are not limited to, the type of security, the
existence of any contractual restrictions on the security's disposition, the
price and extent of public trading in similar securities of the issuer or of
comparable companies, quotations or relevant information obtained from
broker-dealers or other market participants, information obtained from the
issuer, analysts, and/or the appropriate stock exchange (for exchange-traded
securities), an analysis of the company's financial condition, and an evaluation
of the forces that influence the issuer and the market(s) in which the security
is purchased and sold.
B. Investment Transactions - Investment transactions for financial statement
purposes are accounted for on a trade date basis. Realized gains and losses on
investments sold are determined on the basis of identified cost.
C. Interest Income - Interest income is recorded on the basis of interest
accrued, adjusted for amortization of premium or accretion of discount.
D. Federal Taxes - Each Fund's policy is to comply with the provisions of the
Internal Revenue Code (the Code) applicable to regulated investment companies
and to distribute to shareholders each year substantially all of its net
investment income, and all or substantially all of its net realized capital
gains. Accordingly, no provision for federal income or excise tax is necessary.
At December 31, 2008, WTRB and WCIF, for federal income tax purposes, had
capital loss carryovers of $2,067,378 and $1,302,373, respectively, which will
reduce the respective Fund's taxable income arising from future net realized
gain on investments, if any, to the extent permitted by the Code, and thus will
reduce the amount of the distributions to shareholders which would otherwise be
necessary to relieve the respective Fund of any liability for federal income or
excise tax. Pursuant to the Code, such capital loss carryovers will expire as
follows:
December 31, WTRB WCIF
- -------------------------------------------------------------------------------
2010 $ 508,606 $ -
2011 - 476,275
2012 - 469,640
2013 270,953 196,117
2014 1,088,772 -
2015 199,047 160,341
- -------------------------------------------------------------------------------
Additionally, at December 31, 2008, WCIF had net capital losses of $98,225
attributable to security transactions incurred after October 31, 2008. These net
capital losses are treated as arising on the first day of the Fund's taxable
year ending December 31, 2009.
A capital loss carryover of $1,302,373, included in WCIF's amount in the table
above, is available to the Fund as a result of the reorganization of Wright U.S.
Government Near Term Fund on December 9, 2006. Utilization of this capital loss
carryover may be limited in accordance with certain income tax regulations.
As of June 30, 2009, the Funds had no uncertain tax positions that would require
financial statement recognition, de-recognition, or disclosure. Each of the
Fund's federal tax returns filed in the 3-year period ended December 31, 2008
remains subject to examination by the Internal Revenue Service.
E. Expenses - The majority of expenses of the Trust are directly identifiable to
an individual Fund. Expenses which are not readily identifiable to a specific
Fund are allocated taking into consideration, among other things, the nature and
type of expense and the relative size of the Funds.
F. Expense Reduction - State Street Bank & Trust Company (SSBT) serves as
custodian to the Funds. Pursuant to the custodian agreement, SSBT receives a fee
reduced by credits which are determined based on the average daily cash balance
the Funds maintain with SSBT. All credit balances, if any, used to reduce the
Funds' custodian fees are reported as a reduction of expenses in the Statements
of Operations.
G. Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements and
the reported amounts of income and expense during the reporting period. Actual
results could differ from those estimates.
H. Indemnifications - Under the Trust's organizational documents, its officers
and Trustees may be indemnified against certain liabilities and expenses arising
out of the performance of their duties to the Funds, and shareholders are
indemnified against personal liability for the obligations of the Funds.
Additionally, in the normal course of business, the Funds enter into agreements
with service providers that may contain indemnification clauses. Each Fund's
maximum exposure under these arrangements is unknown as this would involve
future claims that may be made against the Funds that have not yet occurred.
I. Interim Financial Statements - The interim financial statements relating to
June 30, 2009 and for the six months then ended have not been audited by an
independent registered public accounting firm, but in the opinion of the Trust's
management reflect all adjustments, consisting only of normal recurring
adjustments, necessary for the fair presentation of the financial statements.
2. Distributions to Shareholders
------------------------------
The net investment income of each Fund is determined daily, and substantially
all of the net investment income so determined is declared daily as a dividend
to shareholders of record at the time of declaration. Distributions are
generally paid monthly. Distributions of net realized capital gains (reduced by
available capital loss carryforwards from prior years, if any) are made at least
annually. Shareholders may reinvest income and capital gain distributions in
additional shares of the same Fund at the net asset value as of the reinvestment
date or, at the election of the shareholder, receive distributions in cash. The
Funds distinguish between distributions on a tax basis and a financial reporting
basis. Accounting principles generally accepted in the United States of America
require that only distributions in excess of tax basis earnings and profits be
reported in the financial statements as a return of capital. Permanent
differences between book and tax accounting relating to distributions are
reclassified to paid-in capital.
3. Investment Adviser Fee and Other Transactions With Affiliates
---------------------------------------------------------------
The investment adviser fee is earned by Wright Investors' Service, Inc. (Wright)
as compensation for investment advisory services rendered to the Funds. The fee
is computed at an annual rate of 0.45% of the average daily net assets for WTRB
and WCIF up to $100 million and at reduced rates as net assets exceed that
level, and is payable monthly. For the year ended December 31, 2008, the fee and
the effective annual rate as a percentage of average daily net assets for each
of the Funds were as follows:
Fund Investment Adviser Fee Effective Annual Rate
-------------------------------------------------------------------
WTRB $ 50,772 0.45%
WCIF 87,825 0.45%
- ------------------------------------------------------------------------------
The administrator fee is earned by Eaton Vance Management (Eaton Vance) for
administering the business affairs of each Fund and is computed at an annual
rate of 0.07% of the average daily net assets up to $100 million for WTRB and an
annual rate of 0.09% of the average daily net assets up to $100 million for
WCIF, and at reduced rates as net assets exceed that level. For the six months
ended June 30, 2009, the administrator fee for WTRB and WCIF amounted to $7,898
and $17,565, respectively. Wright also waived and/or reimbursed expenses for
WTRB and WCIF (see Note 4).
Certain of the Trustees and officers of the Trust are Trustees or officers of
the above organizations and/or the Funds' principal underwriter. Except as to
Trustees of the Trust who are not employees of Eaton Vance or Wright, Trustees
and officers receive remuneration for their services to the Trust out of the
fees paid to Eaton Vance and Wright.
4. Distribution Plans and Service Plans
--------------------------------------
The Trust has in effect a Distribution Plan (the Plan) pursuant to Rule 12b-1 of
the 1940 Act. The Plan provides that each Fund will pay Wright Investors'
Service Distributors, Inc. (WISDI), the principal underwriter, a wholly-owned
subsidiary of The Winthrop Corporation and an affiliate of Wright, a
distribution fee of 0.25% per annum of the average daily net assets of each Fund
for distribution services and facilities provided to each Fund by WISDI.
Distribution fees paid or accrued to WISDI for the six months ended June 30,
2009 for WTRB and WCIF amounted to $28,207 and $48,792, respectively. In
addition, the Trustees have adopted a service plan (the Service Plan) which
allows the Funds to reimburse the principal underwriter for payments to
intermediaries for providing account administration and personal and account
maintenance services to their customers who are beneficial owners of each Fund's
shares. The combined amount of service fees payable under the Service Plan and
Rule 12b-1 distribution fees may not exceed 0.25% annually of each Fund's
average daily net assets. For the six months ended June 30, 2009, the Funds did
not accrue or pay any service fees. Pursuant to an Expense Limitation Agreement,
Wright and WISDI have agreed to waive all or a portion of their fees and
reimburse expenses to the extent that total annual operating expenses after
custodian fee reductions, if any, exceed 0.95% and 1.00% of the average daily
net assets of WTRB and WCIF, respectively, through April 30, 2010. Thereafter,
the waiver and reimbursement may be changed or terminated at any time. Prior to
May 1, 2009, Wright and WISDI had agreed to waive all or a portion of their fees
and reimburse expenses to the extent that total annual operating expenses after
custodian fee reductions, if any, exceeded 0.95% of the average daily net assets
of WCIF. In addition, Wright and WISDI have voluntarily agreed to further limit
the total annual operating expenses after custodian fee reductions, if any, of
WTRB to 0.70% and of WCIF, effective May 1, 2009, to 0.90% of its average daily
net assets. Such voluntary limitation may be terminated at any time. Pursuant to
this agreement and voluntary limitation, Wright and WISDI waived and/or
reimbursed expenses in the aggregate of $97,267 and $64,713 for WTRB and WCIF,
respectively.
5. Investment Transactions
-----------------------------
Purchases and sales (including maturities and paydowns) of investments, other
than short-term obligations, were as follows:
Six Months Ended June 30, 2009
--------------------------------
WTRB WCIF
- --------------------------------------------------------------------------------------------------------------------------------
Purchases -
Non-U.S. Government & Agency Obligations $ 3,161,070 $ -
---------------- ----------------
U.S. Government & Agency Obligations $ 4,254,551 $ 14,740,168
---------------- ----------------
Sales -
Non-U.S. Government & Agency Obligations $ 2,044,316 $ 165,443
---------------- ----------------
U.S. Government & Agency Obligations $ 6,321,565 $ 14,933,761
---------------- ----------------
- --------------------------------------------------------------------------------------------------------------------------------
6. Shares of Beneficial Interest
------------------------------
The Declaration of Trust permits the Trustees to issue an unlimited number of
full and fractional shares of beneficial interest (without par value).
Transactions in Fund shares were as follows:
Six Months Ended Year Ended
June 30, 2009 (Unaudited) December 31, 2008
------------------------- -----------------
Shares Amount Shares Amount
- --------------------------------------------------------------------------------------------------------------------------------
Wright Total Return Bond Fund--
Sold 138,634 $ 1,670,478 496,389 $ 5,923,634
Issued to shareholders in payment of distributions declared 40,503 487,788 77,959 940,667
Redemptions (263,075) (3,156,966) (650,751) (7,839,428)
------------ --------------- ------------ ---------------
Net decrease (83,938) $ (998,700) (76,403) $ (975,127)
============ =============== ============ ===============
Wright Current Income Fund--
Sold 536,016 $ 5,224,961 902,053 $ 8,661,740
Issued to shareholders in payment of distributions declared 62,602 610,788 131,890 1,262,992
Redemptions (669,692) (6,536,377) (1,174,591) (11,225,099)
------------ --------------- ------------ ---------------
Net decrease (71,074) $ (700,628) (140,648) $ (1,300,367)
============ =============== ============ ===============
7. Federal Income Tax Basis of Investments
----------------------------------------
The cost and unrealized appreciation (depreciation) of the investment securities
owned at June 30, 2009, as computed on a federal income tax basis, were as
follows:
WTRB WCIF
- --------------------------------------------------------------------------------------------------------------------------------
Aggregate cost $ 22,339,502 $ 36,827,446
================ ================
Gross unrealized appreciation $ 736,651 $ 1,425,892
Gross unrealized depreciation (667,453) (205,361)
---------------- ----------------
Net unrealized appreciation (depreciation) $ 69,198 $ 1,220,531
================ ================
- --------------------------------------------------------------------------------------------------------------------------------
8. Line of Credit
--------------
The Funds participate with other funds managed by Wright in a committed $10
million unsecured line of credit agreement with a bank. The Funds may
temporarily borrow from the line of credit to satisfy redemption requests or
settle investment transactions. Interest is charged to each Fund based on its
borrowings at an amount above the Federal Funds rate. In addition, a fee
computed at an annual rate of 0.10% on the average daily unused portion of the
$10 million line of credit is allocated among the participating funds at the end
of each quarter. At June 30, 2009, there were no outstanding balances pursuant
to this line of credit.
The average borrowings and average interest rate for the six months ended June
30, 2009 were as follows:
WTRB WCIF
- -------------------------------------------------------------------------------
Average borrowings $ 1,061 $ -
Average interest rate 1.0% -
- -------------------------------------------------------------------------------
9. Fair Value Measurements
-------------------------
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 157 (FAS 157), "Fair Value Measurements" established a three-tier hierarchy
to prioritize the assumptions, referred to as inputs, used in valuation
techniques to measure fair value. The three-tier hierarchy of inputs is
summarized in the three broad levels listed below.
o Level 1 - quoted prices in active markets for identical investments
o Level 2 - other significant observable inputs (including quoted prices
for similar investments, interest rates, prepayment speeds, credit risk, etc.)
o Level 3 - significant unobservable inputs (including a fund's own
assumptions in determining the fair value of investments)
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.
At June 30, 2009, the inputs used in valuing each Fund's investments, which are
carried at value, were as follows:
WTRB
Quoted Prices in
Active Markets for Significant Other Significant
Asset Description Identical Assets Observable Inputs Unobservable Inputs Total
(Level 1) (Level 2) (Level 3)
- --------------------------------------------------------------------------------------------------------------------------------
Total Investments $ - $22,408,700 $ - $22,408,700
- --------------------------------------------------------------------------------------------------------------------------------
WCIF
Quoted Prices in
Active Markets for Significant Other Significant
Asset Description Identical Assets Observable Inputs Unobservable Inputs Total
(Level 1) (Level 2) (Level 3)
- --------------------------------------------------------------------------------------------------------------------------------
Total Investments $ - $38,047,977 $ - $38,047,977
- --------------------------------------------------------------------------------------------------------------------------------
The Funds held no investments or other financial instruments as of December 31,
2008 whose fair value was determined using Level 3 inputs.
The level classification by major category of investments is the same as the
category presentation in the Portfolio of Investments.
10. Review for Subsequent Events
------------------------------
In connection with the preparation of the financial statements of the Funds as
of and for the six months ended June 30, 2009, events and transactions
subsequent to June 30, 2009 through August 18, 2009, the date the financial
statements were issued, have been evaluated by the Funds' management for
possible adjustment and/or disclosure. Management has not identified any
subsequent events requiring financial statement disclosure as of the date these
financial statements were issued.
BOARD OF TRUSTEES
ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENT
IN EVALUATING THE INVESTMENT ADVISORY CONTRACTS, THE INDEPENDENT TRUSTEES
MET SEPARATELY FROM THE INTERESTED TRUSTEES AND REVIEWED AND CONSIDERED
MATERIALS FURNISHED BY WRIGHT, INCLUDING INFORMATION REGARDING WRIGHT, ITS
AFFILIATES AND PERSONNEL, OPERATIONS AND FINANCIAL CONDITION. THE INDEPENDENT
TRUSTEES DISCUSSED WITH REPRESENTATIVES OF WRIGHT THE PORTFOLIO MANAGEMENT AND
OPERATIONS OF THE FUNDS AND THE CAPABILITIES OF WRIGHT TO PROVIDE ADVISORY AND
OTHER SERVICES TO EACH FUND. THE INDEPENDENT TRUSTEES CONSIDERED, AMONG OTHER
THINGS, THE FOLLOWING:
EQUITY FUNDS AND INCOME FUNDS
- -----------------------------
o Whether the advisory arrangements are fair and reasonable relative to
possible alternative arrangements. The Trustees concluded that the
advisory fees paid by the Funds are reasonable.
o Whether advisory services are being provided as agreed to. The Trustees
concluded that the services being provided by the adviser are as agreed
to in the advisory contract.
o Whether compensation paid by a Fund to the adviser is fair and
reasonable in relation to the services provided and the charges by
other advisers for similar services. The Trustees concluded that the
compensation paid by the Funds to the adviser is in the average range
of compensation charged by other advisers for similar services and is
reasonable.
o Fees and expense ratios compared to similar funds. The Trustees
concluded that the expense ratios of the Funds are lower than the
average for similar funds.
o Performance and relationship of fees and performance. The Trustees
concluded that in most cases the performance results of the Funds were
at least in the mid-range of similar funds while their expense ratios
were generally lower.
o Analysis of each Fund's profitability to the adviser. The Trustees
concluded that the profitability to the adviser of each Fund was
reasonable and not excessive.
o The adviser's financial condition and the overall organization of the
adviser.
o Sales and redemption data. The Trustees reviewed the information which
had been provided to them relating to sales and redemptions and
Wright's marketing strategies to try to increase assets under
management.
o The economic outlook and the general investment outlook in the relevant
investment markets. The Trustees have received a presentation on the
overall economic outlook and investment outlook of both equity and
income markets at each Board meeting.
o The resources devoted to compliance efforts undertaken by the adviser
and the record of compliance with investment policies and restrictions
and with policies on personal securities transactions. The Trustees
have approved and met separately with the Funds' Chief Compliance
Officer.
Additional Considerations for Equity Funds
- --------------------------------------------
o The allocation of brokerage and any benefits received by the adviser as
a result of brokerage allocation. The Trustees reviewed the Trading
Analysis included in the material provided in advance of the meeting.
The Independent Trustees' Committee did not consider any single factor as
controlling in their consideration of the renewal of the Investment Advisory
Contracts, nor are the considerations described above all encompassing. Based on
their consideration of all factors which they considered material, and with the
assistance of independent counsel, the Independent Trustees' Committee concluded
that the renewal of the Investment Advisory Contracts with its current fee
structure is in the interests of the shareholders.
IMPORTANT NOTICES REGARDING PRIVACY, DELIVERY OF
SHAREHOLDER DOCUMENTS, PORTFOLIO HOLDINGS AND PROXY VOTING
WRIGHT MANAGED INVESTMENT FUNDS
WRIGHT INVESTORS' SERVICE, INC.
WRIGHT INVESTORS' SERVICE DISTRIBUTORS, INC.
EATON VANCE MANAGEMENT
PRIVACY POLICY
-------------------
Wright is committed to ensuring your financial privacy. Each of the above
financial institutions has the following policy in effect with respect to
nonpublic personal information about its customers:
o The only such information we collect is information received from
customers, through application forms or otherwise, and information which
we necessarily receive in connection with your Wright fund transactions.
o We will not disclose this information to anyone except as required or
permitted by law. Such disclosure includes that made to other companies
such as transfer agents and their employees and to our employees, in each
case as necessary to service your account.
o We have adopted policies and procedures (including physical, electronic
and procedural safeguards) that are designed to protect the
confidentiality of this information.
For more information about Wright's privacy policies please feel free to
call 1-800-888-9471.
Important Notice Regarding Delivery of Shareholders Documents
---------------------------------------------------------------
The Securities and Exchange Commission permits funds to deliver only one
copy of shareholder documents, including prospectuses, proxy statements and
shareholder reports, to fund investors with multiple accounts at the same
residential or post office box address. This practice is often called
"householding" and it helps eliminate duplicate mailings to shareholders.
Wright, or your financial adviser, may household the mailing of your
documents indefinitely unless you instruct Wright, or your financial adviser,
otherwise.
If you would prefer that your Wright documents not be householded, please
contact Wright at 1-800-888-9471, or your financial adviser.
Your instructions that householding not apply to delivery of your Wright
documents will be effective within 30 days of receipt by Wright or your
financial adviser.
Portfolio Holdings
------------------------
In accordance with rules established by the SEC, the funds send semi-annual
and annual reports to shareholders that contain a complete list of portfolio
holdings as of the end of the second and fourth quarters, respectively, within
60 days of quarter-end and after filing with the SEC. The funds also disclose
complete portfolio holdings as of the end of the first and third fiscal quarters
on Form N-Q, which is filed with the SEC within 60 days of quarter-end. The
funds' complete portfolio holdings as reported in annual and semi-annual reports
and on Form N-Q are available for viewing on the SEC website at
http://www.sec.gov and may be reviewed and copied at the SEC's public reference
room (information on the operation and terms of usage of the SEC public
reference room is available at http://sec.gov/info/edgar/prrules.htm or by
calling 1-800-SEC-0330). After filing, the funds' portfolio holdings as reported
in annual and semi-annual reports are also available on Wright's website at
www.wisi.com and are available upon request at no additional cost by contacting
Wright at 1-800-888-9471.
Proxy Voting Policies and Procedures
--------------------------------------------
From time to time funds are required to vote proxies related to the
securities held by the funds. The Wright Managed Funds vote proxies according to
a set of policies and procedures approved by the Funds' Board. You may obtain a
description of these policies and procedures and information on how the Funds
voted proxies relating to portfolio securities during the most recent 12-month
period ended June 30 without charge, upon request, by calling 1-800-888-9471.
This description is also available on the Securities and Exchange Commissions
website at http://www.sec.gov.
WRIGHT INVESTORS' SERVICE DISTRIBUTORS, INC.
440 Wheelers Farms Road, Milford, CT 06461
SEMI-ANNUAL REPORT
OFFICERS AND TRUSTEES OF THE FUNDS
Peter M. Donovan, President and Trustee
A. M. Moody III, Vice President and Trustee
Judith R. Corchard, Vice President
James J. Clarke, Trustee
Dorcas R. Hardy, Trustee
Richard E. Taber, Trustee
Janet E. Sanders, Secretary
Barbara E. Campbell, Treasurer
ADMINISTRATOR
Eaton Vance Management
Two International Place
Boston, Massachusetts 02110
INVESTMENT ADVISER
Wright Investors' Service, Inc.
440 Wheelers Farms Road
Milford, Connecticut 06461
PRINCIPAL UNDERWRITER
Wright Investors' Service Distributors, Inc.
440 Wheelers Farms Road
Milford, Connecticut 06461
(800) 888-9471
e-mail: wright@wisi.com
CUSTODIAN
State Street Bank and Trust Company
200 Clarendon Street
Boston, Massachusetts 02116
TRANSFER AND DIVIDEND DISBURSING AGENT
Atlantic Fund Administration, LLC
P.O. Box 588
Portland, ME 04112
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of a mutual fund unless
accompanied or preceded by a Fund's current prospectus.
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics applicable to its Principal
Executive Officer and Principal Financial Officer. The registrant undertakes to
provide a copy of such code of ethics to any person upon request, without
charge, by calling 1-800-888-9471.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The registrant's Board has designated James J. Clarke, an independent
trustee, as its audit committee financial expert. Mr.Clarke is the Principal of
Clarke Consulting, a financial management and strategic planning firm.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not required in filing.
ITEMS 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not required in Filing
ITEM 6. SCHEDULE OF INVESTMENTS
Please see schedule of investments contained in the Report to Stockholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
Not required in Filing.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES
Not required in Filing
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not required in Filing
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders may
recommend nominees to the registrant's board of directors/trustees.
ITEM 11. CONTROLS AND PROCEDURES
a) It is the conclusion of the registrant's principal executive officer and
principal financial officer that the effectiveness of the registrant's current
disclosure controls and procedures (such disclosure controls and procedures
having been evaluated within 90 days of the date of this filing) provide
reasonable assurance that the information required to be disclosed by the
registrant has been recorded, processed, summarized and reported within the time
period specified in the Commission's rules and forms and that the information
required to be disclosed by the registrant has been accumulated and communicated
to the registrant's principal executive officer and principal financial officer
in order to allow timely decisions regarding required disclosure.
(b) There have been no significant changes in the registrant's internal controls
or in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.
ITEM 12. EXHIBITS
(a) (1) Registrant's Code of Ethics - Not applicable (please see Item 2).
(a) (2) Treasurer's and President's Section 302 certification.
(b) Combined 906 certification.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
The Wright Managed Equity Trust(On behalf of Wright Selected Blue Chip Equities
- -------------------------------------------------------------------------------
Fund, Wright Major Blue Chip Equities Fund and Wright International Blue Chip
- -------------------------------------------------------------------------------
Equities Fund)
- ---------------
By: /s/ Peter M. Donovan
---------------------
Peter M. Donovan
President
Date: August 18,2009
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/ Barbara E. Campbell
------------------------
Barbara E. Campbell
Treasurer
Date: August 19,2009
By: /s/ Peter M. Donovan
---------------------
Peter M. Donovan
President
Date: August 18,2008