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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: 811-05127
Advance Capital I, Inc.
(Exact name of registrant as specified in charter)
One Towne Square, Suite 444
Southfield, Michigan 48076
(Address of principal executive offices) (Zip code)
Robert J. Cappelli, President
Advance Capital I, Inc.
One Towne Square, Suite 444
Southfield, Michigan 48076
(Name and Address of agent for service)
Registrant's telephone number, including area code: (248) 350-8543
Date of fiscal year end: December 31
Date of reporting period: June 30, 2010
Form N-CSR is to be used by management investment companies to file
reports with the Commission not later than 10 days after the transmission
to stockholders of any report that is required to be transmitted to
stockholders under Rule 30e-1 under the Investment Company Act of 1940
(17 CFR 270.30e-1). The Commission may use the information provided on
Form N-CSR in its regulatory, disclosure review, inspection, and
policymaking roles.
A registrant is required to disclose the information specified by
Form N-CSR, and the Commission will make this information public. A
registrant is not required to respond to the collection of information
contained in Form N-CSR unless the Form displays current valid Office of
Management and Budget ("OMB") control number. Please direct comments
concerning the accuracy of the information collection burden estimate and
any suggestions for reducing the burden to Secretary, Securities and
Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609.
The OMB has reviewed this collection of information under the clearance
requirements of 44 U.S.C. 3507.
Item 1. Report to Shareholders.
ADVANCE CAPITAL I
[LOGO]
AN INVESTMENT COMPANY
WITH FOUR FUNDS
Semi-Annual Report
June 30, 2010
Table of Contents
1 A Letter to Our Shareholders
3 Financial Highlights
11 Equity Growth Fund
16 Balanced Fund
24 Retirement Income Fund
29 Core Equity Fund
31 Statements of Assets and Liabilities
32 Statements of Operations
33 Statements of Changes in Net Assets
35 Notes to Financial Statements
40 Additional Information
Advance Capital's Pledge:
We understand that investing in any mutual fund is a leap of faith. We
recognize that trust, integrity and honesty are just a few of the attributes
you should expect from any financial organization. Our commitment to you is
to hold true to these standards by putting your interests first at all times.
We will work hard each and every day to provide you with quality service as
well as our best long-term investment advice. We pledge to maintain the
highest standards of TRUST, INTEGRITY & HONESTY in all of our dealings with
you.
Sincerely,
Advance Capital I, Inc. Board of Directors, Management and Staff
Dear Shareholders,
Six Month Review
While the economy and capital markets have
moderated from the extremes of the past few
years, the fallout from the credit crisis continues
to reverberate through the global financial system.
The U.S. economy continues to show faint signs
of recovery while businesses and consumers are
getting back to their normal lives. Still, serious
problems remain in the economy for our elected
leaders to tackle, including high unemployment,
low economic growth, high deficits and increasing
liabilities of unfunded government programs.
We remain confident, however, that true to our
nation's history and character, we will collectively
solve these complex issues over time. However,
this could have a toll on the economy and capital
markets as events unfold.
To begin, Gross Domestic Product (GDP) rebounded
in the first half of the year, posting a 2.7 percent
annualized growth rate. Yet, the nation's unemployment
rate is stubbornly high at 9.5 percent at the
end of June. While it has declined slightly, there has
been an estimated 8 million jobs lost in this down
turn with many more under employed or simply
discouraged from actively looking for work. During
this period, worker productivity has increased as
existing employees work harder and smarter. Still,
wage growth remains stagnant in this tougher
environment as many companies were forced to cut
pay and benefits to stay afloat. For consumers, this
scenario is quite challenging. The combined impact
of moderate wage growth, falling home values,
volatile financial markets and high unemployment
has left consumers exhausted. Gone are the heydays
of easy credit and excessive borrowing, and
in its place is a more frugal consumer trying to live
within his means, pay down debt and build up savings.
Since consumer spending accounts for about
70 percent of economic growth, this scenario does
not bode well for the economy in the near-term.
The federal government has stepped in to try and
fill this spending gap left by consumers. Through
various initiatives, the government has added
billions in stimulus programs while the Federal
Reserve has purchased financial assets to ensure the
markets remain liquid. Since these initiatives were
enacted, it is estimated that the federal government
has pumped $2-$3 trillion into the economy and
the Federal Reserve has purchased more than $1
trillion in financial securities. These efforts have
stabilized the economy and financial markets.
The tricky part will be unwinding these programs
without too much disruption or negative economic
consequence. In addition to these efforts, a sweeping
financial regulations bill was signed into law
in late July. This bill is the biggest overhaul of the
financial regulatory system since the aftermath of
the Great Depression. The purpose of the bill is to
prevent the type of financial meltdown witnessed
during the credit crisis, create a consumer protection
bureau and develop a framework for liquidation
of "too big to fail" institutions. While still early,
the market appears to have embraced these efforts.
Capital Market Performance
The uncertainty and volatility in the economy led
to an erratic return environment in the capital
markets. Through the first six months, the S&P 500
Index fell 6.6 percent while the Nasdaq Composite
was off 6.6 percent. In the S&P 500 Index, Construction,
Residential REIT and Auto Manufacturers
were the top performing sectors, while Specialty
Consumer, Aluminum and Agriculture sectors
were on the bottom. The first quarter brought
optimism that the economy and investor sentiment
were improving. During the second quarter, the
softer economic data prompted some investors to
reduce risk and seek higher quality investments.
This environment led to higher volatility in stocks
during the first half of the year.
In the fixed income markets, investors were perplexed
as to the direction of inflation and growth.
In the early part of the year, the prospects of higher
inflation appeared evident as economic activity
picked up. By the second quarter, weaker economic
data pointed to subdued growth and evidence that
deflation was the more immediate concern. As this
-1-
scenario unfolded, investors favored higher quality
investment grade and government backed debt
securities.
For the six month period ended June 30th, the
Advance Capital I Equity Growth Fund declined 2.7
percent as compared to the Lipper Mid Cap Growth
Index which declined 3.3 percent. The Balanced
Fund, with its 60-40 mix of stocks and bonds
posted a decline of 1.5 percent, compared to the
Lipper Balanced Index which fell 2.7 percent. The
Core Equity Fund declined 5.6 percent, compared
to the S&P 500 Index which was off 6.6 percent.
The Retirement Income Fund increased 6.0 percent,
compared to the Morningstar Intermediate Bond
average which returned 5.2 percent.
Remainder of the Year
Although the economy has stabilized and is growing
at a positive pace, there are headwinds which
need to be resolved before a full-blown economic
recovery can take hold. First, high paying, skilled
jobs are needed to bring down the nation's elevated
unemployment rate and enable consumers to pay off
debts and contribute to growth. Second, the severely
depressed housing market and declining home
prices of the last few years needs to abate. The strain
on financial institutions and homeowners under this
scenario has been a drag on growth and very socially
disruptive. Next, a strategy is needed to bring down
the ballooning federal and state budget defi cits
without too much pressure on taxpayers. Finally,
European debt problems have to be resolved with
concrete plans to reduce spending without further
international bailouts. Addressing these issues takes
resolve by our leaders and time to strategize and
implement the necessary changes.
While the problems are large, it is apparent that
steps are being taken to set a course to try to solve
them. The unknown is how taxpayers and investors
will react as this unfolds. Congress recently passed
the new financial reform bill and there is growing
pressure on lawmakers to get the federal budget
under control. Fixing these problems will not be
easy or without pain, but inaction could have much
more dire consequences. Hopefully, Congress can
follow in the footsteps of corporate America which
has done a great job of cutting expenses, increasing
liquidity and doing more with less.
In this uncertain environment, the capital markets
are expected to remain volatile as investors digest
economic data and look for signs of improvement.
Still, equity valuations are quite reasonable and
corporate earnings are improving. With short-term
interest rates near zero, investors should continue to
seek higher return on their invested capital without
taking excessive risk. This scenario should bode well
for high quality, proven companies with reasonable
growth, positive free-cash flow and protected
products. As the healing process continues in the
economy and companies regroup, stock and bond
returns should trend higher through the rest of the
year.
As always, we remind investors to stay disciplined
and focused on the long-term. We thank you for
your continued confidence and look forward to providing
you with service and results designed to meet
or exceed your long term investment objectives. If
you have questions or if we can be of service, please
call. Our toll-free number is (800) 345-4783.
/s/ Robert J. Cappelli /s/ Christopher M. Kostiz
Robert J. Cappelli Christopher M. Kostiz
President President
Advance Capital I, Inc. Advance Capital Management, Inc.
-2-
ADVANCE CAPITAL I - EQUITY GROWTH FUND (Retail Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Years Ended December 31
June 30, ----------------------------------------------------------------
2010 2009 2008 2007 2006 2005
Net asset value, beginning of year $18.52 $12.87 $24.11 $24.87 $25.42 $24.61
Income (Loss) from investment operations (a)
Net investment income (loss) (0.01) 0.02 0.00 (0.03) (0.03) (0.10)
Net realized and unrealized gain (loss)
on investments (0.49) 5.66 (11.22) 3.05 2.43 2.56
--------------------------------------------------------------------------
Total from investment operations (0.50) 5.68 (11.22) 3.02 2.40 2.46
Less distributions
Net investment income 0.00 (0.03) 0.00 0.00 0.00 0.00
Net realized gain on investments 0.00 0.00 (0.02) (3.78) (2.76) (1.65)
Return of capital 0.00 0.00 0.00 0.00 (0.19) 0.00
--------------------------------------------------------------------------
Total distributions 0.00 (0.03) (0.02) (3.78) (2.95) (1.65)
--------------------------------------------------------------------------
Net asset value, end of period $18.02 $18.52 $12.87 $24.11 $24.87 $25.42
==========================================================================
Total Return (2.70%) (c) 44.14% (46.53%) 12.05% 9.39% 9.94%
Ratios and Supplemental Data
Net assets, end of period (in thousands) $89,351 $98,960 $83,981 $220,726 $210,179 $196,254
Ratio of expenses to average net assets 1.07% (b) 1.13% 1.06% 1.01% 1.01% 1.00%
Ratio of net investment income (loss)
to average net assets (0.09%) (b) 0.12% (0.02%) (0.10%) (0.10%) (0.39%)
Portfolio turnover rate 13% (c) 27% 27% 33% 38% 30%
(a) Per share amounts presented are based on average shares outstanding.
(b) Annualized
(c) Not Annualized
See Notes to Financial Statements
-3-
ADVANCE CAPITAL I - BALANCED FUND (Retail Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Years Ended December 31
June 30, ----------------------------------------------------------------
2010 2009 2008 2007 2006 2005
Net asset value, beginning of year $14.05 $11.80 $17.66 $18.38 $17.92 $17.96
Income (Loss) from investment operations (a)
Net investment income 0.16 0.38 0.38 0.38 0.39 0.37
Net realized and unrealized gain (loss)
on investments (0.37) 2.25 (5.84) 0.72 1.37 0.47
--------------------------------------------------------------------------
Total from investment operations (0.21) 2.63 (5.46) 1.10 1.76 0.84
Less distributions
Net investment income (0.16) (0.38) (0.39) (0.38) (0.29) (0.37)
Net realized gain on investments 0.00 0.00 (0.01) (1.44) (0.90) (0.51)
Return of capital 0.00 0.00 0.00 0.00 (0.11) 0.00
--------------------------------------------------------------------------
Total distributions (0.16) (0.38) (0.40) (1.82) (1.30) (0.88)
--------------------------------------------------------------------------
Net asset value, end of period $13.68 $14.05 $11.80 $17.66 $18.38 $17.92
==========================================================================
Total Return (1.52%) (c) 22.79% (31.33%) 6.00% 9.91% 4.79%
Ratios and Supplemental Data
Net assets, end of period (in thousands) $170,236 $189,125 $200,199 $400,214 $397,635 $377,837
Ratio of expenses to average net assets 1.06% (b) 1.12% 1.04% 0.97% 0.93% 0.93%
Ratio of net investment income
to average net assets 2.27% (b) 3.03% 2.48% 1.97% 2.14% 2.08%
Portfolio turnover rate 18% (c) 48% 41% 36% 35% 30%
(a) Per share amounts presented are based on average shares outstanding.
(b) Annualized
(c) Not Annualized
See Notes to Financial Statements
-4-
ADVANCE CAPITAL I - RETIREMENT INCOME FUND (Retail Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- --------------------------------------------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Years Ended December 31
June 30, ----------------------------------------------------------------
2010 2009 2008 2007 2006 2005
Net asset value, beginning of year $8.23 $7.46 $9.45 $9.68 $9.85 $10.16
Income (Loss) from investment operations (a)
Net investment income 0.22 0.45 0.52 0.54 0.54 0.53
Net realized and unrealized gain (loss)
on investments 0.27 0.79 (1.98) (0.23) (0.16) (0.30)
--------------------------------------------------------------------------
Total from investment operations 0.49 1.24 (1.46) 0.31 0.38 0.23
Less distributions
Net investment income (0.22) (0.47) (0.53) (0.54) (0.54) (0.54)
Return of capital 0.00 0.00 0.00 0.00 (0.01) 0.00
--------------------------------------------------------------------------
Total distributions (0.22) (0.47) (0.53) (0.54) (0.55) (0.54)
--------------------------------------------------------------------------
Net asset value, end of period $8.50 $8.23 $7.46 $9.45 $9.68 $9.85
==========================================================================
Total Return 6.05% (c) 17.13% (16.03%) 3.33% 3.97% 2.28%
Ratios and Supplemental Data
Net assets, end of period (in thousands) $309,496 $319,349 $340,834 $406,932 $402,076 $408,458
Ratio of expenses to average net assets 0.85% (b) 0.91% 0.83% 0.78% 0.76% 0.74%
Ratio of net investment income
to average net assets 5.33% (b) 5.81% 6.07% 5.69% 5.57% 5.34%
Portfolio turnover rate 34% (c) 58% 58% 51% 62% 56%
(a) Per share amounts presented are based on average shares outstanding.
(b) Annualized
(c) Not Annualized
See Notes to Financial Statements
-5-
ADVANCE CAPITAL I - CORE EQUITY FUND (Retail Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- ---------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Years Ended December 31
June 30, -----------------------------
2010 2009 2008
Net asset value, beginning of year $8.62 $6.51 $10.00
Income (Loss) from investment operations (a)
Net investment income 0.03 0.05 0.06
Net realized and unrealized gain (loss)
on investments (0.51) 2.11 (3.49)
---------------------------------------
Total from investment operations (0.48) 2.16 (3.43)
Less distributions
Net investment income 0.00 (0.05) (0.06)
---------------------------------------
Total distributions 0.00 (0.05) (0.06)
---------------------------------------
Net asset value, end of period $8.14 $8.62 $6.51
=======================================
Total Return (5.57%) (c) 33.19% (34.35%)
Ratios and Supplemental Data
Net assets, end of period (in thousands) $8,784 $9,768 $8,469
Ratio of expenses to average net assets 1.40% (b,d) 1.44% (d) 1.39% (d)
Ratio of expenses to average net assets 1.28% (b,e) 1.31% (e) 1.28% (e)
Ratio of net investment income
to average net assets 0.64% (b) 0.66% 0.66%
Portfolio turnover rate 19% (c) 33% 68%
(a) Per share amounts presented are based on average shares outstanding.
(b) Annualized
(c) Not Annualized
(d) Before waivers
(e) Net of waivers
See Notes to Financial Statements
-6-
ADVANCE CAPITAL I - EQUITY GROWTH FUND (Institutional Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- -------------------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Periods Ended December 31
June 30, ---------------------------------------
2010 2009 2008 2007 (a)
Net asset value, beginning of period $18.49 $12.81 $24.16 $27.28
Income (Loss) from investment operations (b)
Net investment income 0.02 0.06 0.06 0.02
Net realized and unrealized gain (loss)
on investments (0.50) 5.65 (11.39) 0.64
----------------------------------------------------
Total from investment operations (0.48) 5.71 (11.33) 0.66
Less distributions
Net investment income 0.00 (0.03) 0.00 0.00
Net realized gain on investments 0.00 0.00 (0.02) (3.78)
----------------------------------------------------
Total distributions 0.00 (0.03) (0.02) (3.78)
----------------------------------------------------
Net asset value, end of period $18.01 $18.49 $12.81 $24.16
====================================================
Total Return (2.60%)(d) 44.58% (46.89%) 2.34%(d)
Ratios and Supplemental Data
Net assets, end of period (in thousands) $145 $141 $92 $118
Ratio of expenses to average net assets 0.82% (c) 0.88% 0.80% 0.77% (c)
Ratio of net investment income
to average net assets 0.16% (c) 0.36% 0.31% 0.12% (c)
Portfolio turnover rate 13% (d) 27% 27% 33%
(a) For the period May 4, 2007, commencement of operations,
to December 31, 2007.
(b) Per share amounts presented are based on average shares outstanding.
(c) Annualized
(d) Not Annualized
See Notes to Financial Statements
-7-
ADVANCE CAPITAL I - BALANCED FUND (Institutional Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- -------------------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Periods Ended December 31
June 30, ---------------------------------------
2010 2009 2008 2007 (a)
Net asset value, beginning of period $14.01 $11.77 $17.66 $19.43
Income (Loss) from investment operations (b)
Net investment income 0.18 0.41 0.42 0.29
Net realized and unrealized gain (loss)
on investments (0.37) 2.24 (5.87) (0.33)
----------------------------------------------------
Total from investment operations (0.19) 2.65 (5.45) (0.04)
Less distributions
Net investment income (0.18) (0.41) (0.43) (0.29)
Net realized gain on investments 0.00 0.00 (0.01) (1.44)
----------------------------------------------------
Total distributions (0.18) (0.41) (0.44) (1.73)
----------------------------------------------------
Net asset value, end of period $13.64 $14.01 $11.77 $17.66
====================================================
Total Return (1.40%)(d) 23.06% (31.33%) (0.22%)(d)
Ratios and Supplemental Data
Net assets, end of period (in thousands) $135 $139 $117 $175
Ratio of expenses to average net assets 0.81%(c) 0.87% 0.79% 0.74% (c)
Ratio of net investment income
to average net assets 2.51%(c) 3.24% 2.79% 2.25% (c)
Portfolio turnover rate 18%(d) 48% 41% 36%
(a) For the period May 4, 2007, commencement of operations, to
December 31, 2007.
(b) Per share amounts presented are based on average shares outstanding.
(c) Annualized
(d) Not Annualized
See Notes to Financial Statements
-8-
ADVANCE CAPITAL I - RETIREMENT INCOME FUND (Institutional Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- -------------------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Periods Ended December 31
June 30, ---------------------------------------
2010 2009 2008 2007 (a)
Net asset value, beginning of period $8.23 $7.46 $9.45 $9.71
Income (Loss) from investment operations (b)
Net investment income 0.23 0.47 0.55 0.36
Net realized and unrealized gain (loss)
on investments 0.27 0.79 (1.99) (0.25)
----------------------------------------------------
Total from investment operations 0.50 1.26 (1.44) 0.11
Less distributions
Net investment income (0.23) (0.49) (0.55) (0.37)
----------------------------------------------------
Total distributions (0.23) (0.49) (0.55) (0.37)
----------------------------------------------------
Net asset value, end of period $8.50 $8.23 $7.46 $9.45
====================================================
Total Return 6.18%(d) 17.42% (15.82%) 1.19%(d)
Ratios and Supplemental Data
Net assets, end of period (in thousands) $2,741 $1,664 $1,841 $3,508
Ratio of expenses to average net assets 0.60%(c) 0.66% 0.58% 0.56%(c)
Ratio of net investment income
to average net assets 5.53%(c) 6.07% 6.26% 5.92%(c)
Portfolio turnover rate 34%(d) 58% 58% 51%
(a) For the period May 4, 2007, commencement of operations, to
December 31, 2007.
(b) Per share amounts presented are based on average shares outstanding.
(c) Annualized
(d) Not Annualized
See Notes to Financial Statements
-9-
ADVANCE CAPITAL I - CORE EQUITY FUND (Institutional Shares)
FINANCIAL HIGHLIGHTS
SELECTED PER-SHARE DATA AND RATIOS
(For a Share Outstanding Throughout Each Period)
- ---------------------------------------------------------------------------------------------
(Unaudited)
Six Months
Ended Periods Ended December 31
June 30, -----------------------------
2010 2009 2008
Net asset value, beginning of year $8.67 $6.51 $10.00
Income (Loss) from investment operations (a)
Net investment income 0.04 0.07 0.07
Net realized and unrealized gain (loss)
on investments (0.52) 2.14 (3.48)
-------------------------------------------
Total from investment operations (0.48) 2.21 (3.41)
Less distributions
Net investment income 0.00 (0.05) (0.08)
-------------------------------------------
Total distributions 0.00 (0.05) (0.08)
-------------------------------------------
Net asset value, end of period $8.19 $8.67 $6.51
===========================================
Total Return (5.54%)(c) 33.95% (34.14%)
Ratios and Supplemental Data
Net assets, end of period (in thousands) $358 $379 $0 (d)
Ratio of expenses to average net assets 1.15%(b,e) 1.17%(e) 1.16%(e)
Ratio of expenses to average net assets 1.03%(b,f) 1.04%(f) 1.05%(f)
Ratio of net investment income
to average net assets 0.89%(b) 0.89% 0.79%
Portfolio turnover rate 19%(c) 33% 68%
(a) Per share amounts presented are based on average shares outstanding.
(b) Annualized
(c) Not Annualized
(d) Amount rounds to zero
(e) Before waivers
(f) Net of waivers
See Notes to Financial Statements
-10-
ADVANCE CAPITAL I - EQUITY GROWTH FUND
SUMMARY OF PORTFOLIO HOLDINGS (Unaudited)
JUNE 30, 2010
[EDGAR REFERENCE - PIE CHART FOR SUMMARY OF PORTFOLIO
HOLDINGS AS OF JUNE 30, 2010]
Technology 15.4%
Financial 8.9%
Consumer Cyclical 13.2%
Communications 8.2%
Consumer Non-Cyclical 24.5%
Energy 7.1%
Cash & Other Assets 2.5%
Utilities 0.8%
Basic Materials 4.9%
Industrial 14.5%
Top Ten Holdings*
Coach, Inc. 0.83%
Avon Products, Inc. 0.83%
Precision Castparts Corp. 0.82%
Lorillard, Inc. 0.79%
Cognizant Technology 0.77%
McCormick & Co., Inc. 0.73%
Intuit, Inc. 0.72%
Ross Stores, Inc. 0.70%
McDermott International, Inc. 0.68%
Paychex, Inc. 0.67%
* Percentages based on Total Net Assets
-11-
ADVANCE CAPITAL I - EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
BASIC MATERIALS - 4.9%
Agnico-Eagle Mines Ltd 7,100 $ 431,538
Air Products & Chemicals, Inc. 2,200 142,582
Albemarle Corp. 4,300 170,753
Carpenter Technology Corp. 6,800 223,244
CF Industries Holdings, Inc. 4,100 260,145
Cliffs Natural Resources, Inc. 6,700 315,972
Compass Minerals 5,900 414,652
Ecolab, Inc. 13,100 588,321
Eldorado Gold Corp. 14,600 262,216
Intrepid Potash, Inc.* 5,800 113,506
Sherwin-Williams Co. 5,700 394,383
Sigma-Aldrich Corp. 5,600 279,048
Sociedad Quimica - ADR 12,100 394,581
United States Steel Corp. 3,200 123,360
Vulcan Materials Co. 5,400 236,682
COMMUNICATIONS - 8.2%
Akamai Technologies, Inc.* 10,100 409,757
Atheros Communications, Inc.* 4,600 126,684
Cablevision Systems Corp. 10,300 247,303
Central European Media* 4,300 85,570
Crown Castle International* 8,100 301,806
CTC Media, Inc.* 9,600 138,624
Ctrip.com International Ltd - ADR* 3,600 135,216
Discovery Communications* 15,100 467,043
Equinix, Inc.* 2,000 162,440
Expedia, Inc. 13,300 249,774
Factset Research Systems 6,100 408,639
F5 Networks, Inc.* 3,200 219,424
JDS Uniphase Corp.* 13,700 134,808
Juniper Networks, Inc.* 20,500 467,810
Leap Wireless International* 11,200 145,376
Liberty Media Corp - Starz* 3,200 165,888
Liberty Media Corp - Interactive* 27,700 290,850
McAfee, Inc.* 16,000 491,520
McGraw-Hill Cos., Inc. 15,800 444,612
MetroPCS Communications* 24,500 200,655
NeuStar, Inc.* 6,500 134,030
NII Holdings, Inc.* 5,400 175,608
Omnicom Group, Inc. 3,700 126,910
priceline.com, Inc.* 2,400 423,696
Rackspace Hosting, Inc.* 8,500 155,890
SBA Communications Corp.* 11,500 391,115
Sina Corp.* 4,400 155,144
Symantec Corp.* 9,900 137,412
VeriSign, Inc.* 13,300 353,115
CONSUMER, CYCLICAL - 13.2%
Advance Auto Parts, Inc. 3,300 $ 165,594
AutoZone, Inc.* 1,100 212,542
Bed Bath & Beyond, Inc.* 14,000 519,120
Big Lots, Inc.* 4,100 131,569
CarMax, Inc.* 24,100 479,590
Chipotle Mexican Grill, Inc.* 2,000 273,620
Choice Hotels International 7,500 226,575
Coach, Inc. 20,400 745,620
Copart, Inc.* 5,200 186,212
Dick's Sporting Goods, Inc.* 8,100 201,609
Dollar General Corp.* 7,200 198,360
Dollar Tree, Inc.* 6,900 287,247
DreamWorks Animation SKG* 7,400 211,270
Family Dollar Stores, Inc. 6,500 244,985
Fastenal Co. 8,500 426,615
Gap, Inc. 7,000 136,220
Hyatt Hotels Corp.* 4,000 148,360
International Game Tech. 27,100 425,470
KB Home 4,000 44,000
Lennar Corp. 8,500 118,235
Madison Square Garden, Inc.* 4,325 85,073
Marriott International, Inc. 17,380 520,357
Mattel, Inc. 20,800 440,128
Men's Wearhouse, Inc. 6,337 116,347
O'Reilly Automotive, Inc.* 8,300 394,748
PACCAR, Inc. 3,500 139,545
Panera Bread Co.* 4,400 331,276
PetSmart, Inc. 4,800 144,816
Pulte Group, Inc.* 11,077 91,718
Ross Stores, Inc. 11,800 628,822
Royal Caribbean Cruises Ltd* 7,200 163,944
Skywest, Inc. 14,300 174,746
Southwest Airlines Co. 14,500 161,095
Staples, Inc. 7,800 148,590
Starwood Hotels & Resorts 8,000 331,440
Tiffany & Co. 9,200 348,772
Tim Hortons, Inc. 7,400 236,800
Toll Brothers, Inc.* 7,800 127,608
Tractor Supply Co. 3,500 213,395
Urban Outfitters, Inc.* 8,700 299,193
WABCO Holdings, Inc.* 4,600 144,808
Williams-Sonoma, Inc. 6,500 161,330
WMS Industries, Inc.* 5,100 200,175
WW Grainger, Inc. 5,000 497,250
Wynn Resorts Ltd 4,000 305,080
See Notes to Financial Statements
-12-
ADVANCE CAPITAL I - EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
CONSUMER, NON-CYCLICAL - 24.5%
Alberto-Culver Co. 6,700 $ 181,503
Alexion Pharmaceuticals, Inc.* 6,600 337,854
American Medical Systems* 7,500 165,900
American Reprographics Co.* 10,200 89,046
AmerisourceBergen Corp. 6,500 206,375
Apollo Group, Inc.* 8,329 353,733
Arthrocare Corp.* 6,600 202,290
Avon Products, Inc. 28,000 742,000
Biogen Idec, Inc.* 3,100 147,095
BioMarin Pharmaceutical, Inc.* 6,700 127,032
Brown-Forman Corp. 8,425 482,163
Bruker Corp.* 14,600 177,536
Campbell Soup Co. 10,600 379,798
CareFusion Corp.* 10,100 229,270
Cephalon, Inc.* 4,400 249,700
Charles River Laboratories* 4,700 160,787
Church & Dwight Co., Inc. 6,500 407,615
CIGNA Corp. 3,800 118,028
Clorox Co. 8,700 540,792
Community Health Systems* 6,400 216,384
Corporate Executive Board 5,500 144,485
Covance, Inc.* 2,500 128,300
CR Bard, Inc. 7,200 558,216
DaVita, Inc.* 6,000 374,640
Dendreon Corp.* 4,900 158,417
DENTSPLY International, Inc. 8,800 263,208
DeVry, Inc. 7,300 383,177
Education Management Corp.* 7,900 120,475
Edwards Lifesciences Corp.* 6,400 358,528
Elan Corp PLC - ADR* 19,700 88,650
Equifax, Inc. 5,400 151,524
Genpact Ltd* 8,900 138,217
Gen-Probe, Inc.* 3,100 140,802
Global Payments, Inc. 5,200 190,008
Henry Schein, Inc.* 6,700 367,830
Hershey Co. 6,200 297,166
Hertz Global Holdings, Inc.* 27,600 261,096
Hewitt Associates, Inc.* 4,600 158,516
Hologic, Inc.* 10,100 140,693
Humana, Inc.* 3,800 173,546
Human Genome Sciences, Inc.* 8,700 197,142
IDEXX Laboratories, Inc.* 6,400 389,760
Illumina, Inc.* 8,800 383,064
Intuitive Surgical, Inc.* 1,200 378,744
Iron Mountain, Inc. 9,900 222,354
CONSUMER, NON-CYCLICAL - 24.5% (continued)
ITT Educational Services, Inc.* 2,500 $ 207,550
JM Smucker Co. 3,700 222,814
Laboratory Corp of America* 6,100 459,635
Life Technologies Corp.* 8,400 396,900
Lincare Holdings, Inc. 4,800 156,048
Lorillard, Inc. 7,400 532,652
Manpower, Inc. 3,200 138,176
Masimo Corp.* 4,500 107,145
McCormick & Co., Inc. 17,200 652,912
Mead Johnson Nutrition Co. 5,000 250,600
Monster Worldwide, Inc.* 10,000 116,500
Moody's Corp. 17,600 350,592
Myriad Genetics, Inc.* 7,200 107,640
New Oriental Education - ADR* 1,700 158,423
Patterson Cos., Inc. 5,500 156,915
Paychex, Inc. 22,987 596,972
Perrigo Co. 2,900 171,303
QIAGEN NV* 8,400 161,448
Quanta Services, Inc.* 19,700 406,805
Quest Diagnostics, Inc. 10,622 528,657
Regeneron Pharmaceuticals* 5,700 127,224
ResMed, Inc.* 2,700 164,187
Ritchie Bros Auctioneers, Inc. 16,600 302,452
Robert Half International, Inc. 10,500 247,275
SEI Investments Co. 7,800 158,808
Shire PLC - ADR 3,400 208,692
St Jude Medical, Inc.* 7,100 256,239
Strayer Education, Inc. 900 187,101
Techne Corp. 4,400 252,780
Universal Health Services, Inc. 4,100 156,415
Varian Medical Systems, Inc.* 5,600 292,768
Verisk Analytics, Inc.* 6,200 185,380
Vertex Pharmaceuticals, Inc.* 10,770 354,333
VistaPrint NV* 4,700 223,203
Warner Chilcott PLC* 4,100 93,685
Western Union Co. 37,100 553,161
Whole Foods Market, Inc.* 12,500 450,250
Zimmer Holdings, Inc.* 3,200 172,960
ENERGY - 7.1%
Arch Coal, Inc. 9,397 186,155
Atlas Energy, Inc.* 5,200 140,764
Cabot Oil & Gas Corp. 4,500 140,940
Cameron International Corp.* 14,400 468,288
Cobalt International Energy* 9,900 73,755
Concho Resources, Inc.* 9,600 531,168
See Notes to Financial Statements
-13-
ADVANCE CAPITAL I - EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
ENERGY - 7.1% (continued)
Consol Energy, Inc. 3,800 $ 128,288
Continental Resources, Inc.* 4,600 205,252
Core Laboratories 2,800 413,308
Diamond Offshore Drilling, Inc. 3,700 230,103
Dresser-Rand Group, Inc.* 5,400 170,370
Dril-Quip, Inc.* 3,100 136,462
First Solar, Inc.* 1,800 204,894
FMC Technologies, Inc.* 9,200 484,472
Forest Oil Corp.* 8,000 218,880
Massey Energy Co. 3,300 90,255
Murphy Oil Corp. 3,600 178,380
Nabors Industries Ltd* 7,300 128,626
Newfield Exploration Co.* 3,300 161,238
Oceaneering International, Inc.* 4,800 215,520
Peabody Energy Corp. 12,900 504,777
Range Resources Corp. 5,800 232,870
SandRidge Energy, Inc.* 9,100 53,053
Southwestern Energy Co.* 5,000 193,200
Tetra Technologies, Inc.* 16,000 145,280
Ultra Petroleum Corp.* 6,200 274,350
Walter Energy, Inc. 6,800 413,780
FINANCIAL - 8.9%
AON Corp. 6,900 256,128
Arch Capital Group Ltd* 2,900 216,050
Artio Global Investors, Inc. 4,300 67,682
Assurant, Inc. 4,300 149,210
Axis Capital Holdings Ltd 5,700 169,404
CBOE Holdings, Inc.* 10,300 335,265
City National Corp. 2,500 128,075
Eaton Vance Corp. 10,700 295,427
Federal Realty Investment 6,000 421,620
Federated Investors, Inc. 6,300 130,473
Fifth Third Bancorp 13,100 160,999
First Horizon National Corp.* 13,952 159,747
Forest City Enterprises, Inc.* 14,100 159,612
HCC Insurance Holdings, Inc. 6,400 158,464
Interactive Brokers Group, Inc.* 8,800 146,080
IntercontinentalExchange, Inc.* 4,900 553,847
Janus Capital Group, Inc. 23,700 210,456
KeyCorp 21,100 162,259
Lazard Ltd 9,900 264,429
Marshall & Ilsley Corp. 28,000 201,040
Northern Trust Corp. 11,000 513,700
NYSE Euronext 10,900 301,167
optionsXpress Holdings, Inc.* 11,200 176,288
FINANCIAL - 8.9% (continued)
Popular, Inc.* 78,999 $ 211,717
Principal Financial Group, Inc. 9,400 220,336
Public Storage 5,700 501,087
Regions Financial Corp. 20,800 136,864
RenaissanceRe Holdings Ltd 3,300 185,691
SLM Corp.* 16,100 167,279
SVB Financial Group* 3,700 152,551
TCF Financial Corp. 10,200 169,422
TD Ameritrade Holding Corp.* 27,900 426,870
Waddell & Reed Financial, Inc. 5,300 115,964
WR Berkley Corp. 7,100 187,866
Zions Bancorporation 7,000 150,990
INDUSTRIAL - 14.5%
Alliant Techsystems, Inc.* 1,900 117,914
AMETEK, Inc. 9,400 377,410
Amphenol Corp. 7,700 302,456
Bucyrus International, Inc. 2,800 132,860
CH Robinson Worldwide, Inc. 10,000 556,600
CLARCOR, Inc. 4,700 166,944
Cogent, Inc.* 17,000 153,170
Cooper Industries PLC 5,200 228,800
Cummins, Inc. 4,500 293,085
Cymer, Inc.* 4,800 144,192
Dolby Laboratories, Inc.* 6,800 426,292
Donaldson Co., Inc. 6,900 294,285
Elbit Systems Ltd 2,900 145,812
Empresa Brasileira - ADR 7,900 165,505
Expeditors International 14,400 496,944
FLIR Systems, Inc.* 5,600 162,904
Flowserve Corp. 2,900 245,920
Fluor Corp. 13,200 561,000
Foster Wheeler AG* 11,000 231,660
General Cable Corp.* 6,600 175,890
Gentex Corp. 6,900 124,062
Goodrich Corp. 6,300 417,375
Graco, Inc. 5,000 140,950
Harsco Corp. 5,000 117,500
IDEX Corp. 4,925 140,707
II-VI, Inc.* 4,500 133,335
Itron, Inc.* 2,200 136,004
ITT Corp. 1,900 85,348
Jabil Circuit, Inc. 12,200 162,260
Joy Global, Inc. 6,600 330,594
Landstar System, Inc. 8,600 335,314
McDermott International, Inc.* 28,300 612,978
See Notes to Financial Statements
-14-
ADVANCE CAPITAL I - EQUITY GROWTH FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
INDUSTRIAL - 14.5% (continued)
Mettler-Toledo International, Inc.* 3,100 $ 346,053
National Instruments Corp. 8,550 271,719
Pall Corp. 6,800 233,716
Precision Castparts Corp. 7,100 730,732
Republic Services, Inc. 10,750 319,598
Rockwell Automation, Inc. 3,900 191,451
Rockwell Collins, Inc. 7,500 398,475
Roper Industries, Inc. 4,600 257,416
Stericycle, Inc.* 5,300 347,574
Terex Corp.* 7,100 133,054
TransDigm Group, Inc.* 3,500 178,605
Trimble Navigation Ltd* 14,800 414,400
Valmont Industries, Inc. 2,600 188,916
Wabtec Corp. 3,800 151,582
Waste Connections, Inc.* 5,300 184,917
Waters Corp.* 5,600 362,320
Zebra Technologies Corp.* 5,800 147,146
TECHNOLOGY - 15.4%
Adobe Systems, Inc.* 5,400 142,722
Altera Corp. 20,000 496,200
Analog Devices, Inc. 14,600 406,756
ANSYS, Inc.* 8,200 332,674
Autodesk, Inc.* 12,300 299,628
BMC Software, Inc.* 11,800 408,634
Broadcom Corp. 6,000 197,820
CA, Inc. 16,300 299,920
Cerner Corp.* 5,200 394,628
Check Point Software* 5,500 162,140
Citrix Systems, Inc.* 8,300 350,509
Cognizant Technology* 10,612 531,236
Computer Sciences Corp. 3,400 153,850
Dun & Bradstreet Corp. 1,900 127,528
Electronic Arts, Inc.* 11,100 159,840
Fairchild Semiconductor* 11,600 97,556
Fidelity National Information 6,900 185,058
Fiserv, Inc.* 3,900 178,074
GT Solar International, Inc.* 19,400 108,640
Informatica Corp.* 7,400 176,712
Intersil Corp. 10,000 121,100
COMMON STOCK AND
SHORT-TERM INVESTMENTS SHARES VALUE
- --------------------------------------------------------
TECHNOLOGY - 15.4% (continued)
Intuit, Inc.* 18,500 $ 643,245
Jack Henry & Associates, Inc. 5,900 140,892
KLA-Tencor Corp. 4,200 117,096
Lam Research Corp.* 6,700 255,002
Linear Technology Corp. 17,000 472,770
Logitech International* 13,500 181,035
Marvell Technology Group* 30,100 474,376
Maxim Integrated Products, Inc. 11,300 189,049
MEMC Electronic Materials, Inc.* 17,300 170,924
Microchip Technology, Inc. 13,057 362,201
MICROS Systems, Inc.* 9,500 302,765
MSCI, Inc.* 9,800 268,520
National Semiconductor Corp. 26,600 358,036
NetApp, Inc.* 15,300 570,843
Nuance Communications, Inc.* 15,800 236,210
NVIDIA Corp.* 48,300 493,143
ON Semiconductor Corp.* 26,600 169,708
QLogic Corp.* 12,600 209,412
Red Hat, Inc.* 14,000 405,160
Rovi Corp.* 9,500 360,145
Salesforce.com, Inc.* 3,600 308,952
Seagate Technology* 27,800 362,512
Silicon Laboratories, Inc.* 5,700 231,192
Solera Holdings, Inc. 6,700 242,540
Synopsys, Inc.* 6,800 141,916
Varian Semiconductor* 11,700 335,322
Xilinx, Inc. 19,600 495,096
UTILITIES - 0.8%
Calpine Corp.* 26,600 338,352
NRG Energy, Inc.* 18,900 400,869
-------------
TOTAL COMMON STOCK - 97.5%
(Cost $88,166,434) 87,268,369
SHORT-TERM INVESTMENTS - 0.7%
Fifth Third Inst. Money Mkt Fund, 0.13% Yield
(Cost $653,643) 653,643
-------------
TOTAL INVESTMENTS IN SECURITIES - 98.2%
(Cost $88,820,078) 87,922,012
OTHER ASSETS LESS LIABILITIES - 1.8% 1,574,030
-------------
TOTAL NET ASSETS - 100.0% $ 89,496,042
=============
*Securities are non-income producing
ADR - American Depository Receipt
See Notes to Financial Statements
-15-
ADVANCE CAPITAL I - BALANCED FUND
SUMMARY OF PORTFOLIO HOLDINGS (Unaudited)
JUNE 30, 2010
[EDGAR REFERENCE - PIE CHART FOR SUMMARY OF PORTFOLIO
HOLDINGS AS OF JUNE 30, 2010]
Large-Cap Stocks 33.0%
Investment Grade 29.5%
Mid-Cap Stocks 27.9%
Mortgage-Backed 6.8%
Cash & Other Assets 2.8%
Top Equity Holdings*
Chevron Corp. 1.28%
JPMorgan Chase & Co. 1.01%
AT&T, Inc. 0.81%
Wells Fargo & Co 0.77%
Exxon Mobil Corp. 0.77%
Top Fixed Income Holdings*
Consumers Energy Co. 6.700% 2019 1.41%
Michigan Bell Telephone Co. 7.850% 2022 1.40%
Comcast Holdings Corp. 10.625% 2012 1.37%
PSEG Power, LLC 5.500% 2015 1.30%
National Rural Utilities
Cooperative 10.375% 2018 1.22%
* Percentages based on Total Net Assets
-16-
ADVANCE CAPITAL I - BALANCED FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
BASIC MATERIALS - 3.6%
Agnico-Eagle Mines Ltd 8,200 $ 498,396
Air Products & Chemicals, Inc. 4,100 265,721
Albemarle Corp. 1,500 59,565
BHP Billiton Ltd - ADR 7,300 452,527
Carpenter Technology Corp. 10,600 347,998
CF Industries Holdings, Inc. 1,500 95,175
Cliffs Natural Resources, Inc. 2,100 99,036
Compass Minerals 2,200 154,616
Ecolab, Inc. 4,500 202,095
Eldorado Gold Corp. 22,300 400,508
Freeport-McMoRan 6,100 360,693
Intrepid Potash, Inc.* 2,200 43,054
Monsanto Co. 4,000 184,880
Nucor Corp. 4,800 183,744
Potash Corp of Saskatchewan 2,000 172,480
Praxair, Inc. 3,100 235,569
Rio Tinto PLC - ADR 6,700 292,120
Sherwin-Williams Co. 9,600 664,224
Sigma-Aldrich Corp. 1,800 89,694
Sociedad Quimica - ADR 15,100 492,411
United States Steel Corp. 1,500 57,825
Vale SA - ADR 14,700 357,945
Vulcan Materials Co. 6,700 293,661
Weyerhaeuser Co. 5,100 179,520
COMMUNICATIONS - 5.0%
Akamai Technologies, Inc.* 3,600 146,052
America Movil - ADR 5,000 237,500
AT&T, Inc. 52,700 1,274,813
Atheros Communications, Inc.* 1,700 46,818
Cablevision Systems Corp. 13,900 333,739
Central European Media* 1,900 37,810
Cisco Systems, Inc.* 13,300 283,423
Crown Castle International* 3,200 119,232
CTC Media, Inc.* 4,000 57,760
Ctrip.com International Ltd - ADR* 1,800 67,608
Discovery Communications* 5,300 163,929
Equinix, Inc.* 700 56,854
Expedia, Inc. 4,900 92,022
Factset Research Systems 2,200 147,378
F5 Networks, Inc.* 1,200 82,284
JDS Uniphase Corp.* 6,400 62,976
Juniper Networks, Inc.* 7,400 168,868
Leap Wireless International* 4,300 55,814
Liberty Media Corp - Starz* 1,200 62,208
Liberty Media Corp - Interactive* 54,200 569,100
McAfee, Inc.* 4,800 147,456
COMMUNICATIONS - 5.0% (continued)
McGraw-Hill Cos., Inc. 24,000 $ 675,360
MetroPCS Communications* 8,400 68,796
NeuStar, Inc.* 2,400 49,488
NII Holdings, Inc.* 2,000 65,040
Omnicom Group, Inc. 8,200 281,260
priceline.com, Inc.* 700 123,578
QUALCOMM, Inc. 5,800 190,472
Rackspace Hosting, Inc.* 3,100 56,854
SBA Communications Corp.* 4,000 136,040
Sina Corp.* 1,600 56,416
Symantec Corp.* 17,300 240,124
Time Warner, Inc. 16,266 470,250
Time Warner Cable, Inc. 6,700 348,936
VeriSign, Inc.* 4,500 119,475
Verizon Communications, Inc. 25,700 720,114
Walt Disney Co. 23,900 752,850
CONSUMER, CYCLICAL - 6.4%
Advance Auto Parts, Inc. 1,200 60,216
AutoZone, Inc.* 400 77,288
Bed Bath & Beyond, Inc.* 5,300 196,524
Big Lots, Inc.* 1,600 51,344
CarMax, Inc.* 8,700 173,130
Carnival Corp. 9,600 290,304
Chipotle Mexican Grill, Inc.* 600 82,086
Choice Hotels International 2,700 81,567
Coach, Inc. 7,000 255,850
Copart, Inc.* 1,600 57,296
CVS Caremark Corp. 8,300 243,356
Dick's Sporting Goods, Inc.* 3,100 77,159
Dollar General Corp.* 2,500 68,875
Dollar Tree, Inc.* 2,850 118,646
DreamWorks Animation SKG* 2,100 59,955
Family Dollar Stores, Inc. 2,300 86,687
Fastenal Co. 3,300 165,627
Gap, Inc. 14,400 280,224
Home Depot, Inc. 42,900 1,204,203
Hyatt Hotels Corp.* 1,500 55,635
International Game Tech. 9,000 141,300
KB Home 1,500 16,500
Lennar Corp. 16,900 235,079
Madison Square Garden, Inc.* 1,600 31,472
Marriott International, Inc. 6,375 190,868
Mattel, Inc. 28,500 603,060
McDonald's Corp. 9,600 632,352
Men's Wearhouse, Inc. 2,475 45,441
NIKE, Inc. 4,200 283,710
See Notes to Financial Statements
-17-
ADVANCE CAPITAL I - BALANCED FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
CONSUMER, CYCLICAL - 6.4% (continued)
O'Reilly Automotive, Inc.* 3,100 $ 147,436
PACCAR, Inc. 12,300 490,401
Panera Bread Co.* 1,500 112,935
PetSmart, Inc. 1,900 57,323
Pulte Group, Inc.* 4,060 33,617
Ross Stores, Inc. 4,000 213,160
Royal Caribbean Cruises Ltd* 2,600 59,202
Skywest, Inc. 5,200 63,544
Southwest Airlines Co. 27,400 304,414
Staples, Inc. 2,800 53,340
Starwood Hotels & Resorts 15,800 654,594
Tiffany & Co. 3,300 125,103
Tim Hortons, Inc. 2,700 86,400
TJX Cos., Inc. 7,000 293,650
Toll Brothers, Inc.* 2,700 44,172
Tractor Supply Co. 1,100 67,067
Urban Outfitters, Inc.* 3,200 110,048
WABCO Holdings, Inc.* 1,600 50,368
Walgreen Co. 9,500 253,650
Wal-Mart Stores, Inc. 16,400 788,348
Williams-Sonoma, Inc. 2,000 49,640
WMS Industries, Inc.* 1,900 74,575
WW Grainger, Inc. 5,600 556,920
Wynn Resorts Ltd 1,200 91,524
Yum! Brands, Inc. 5,500 214,720
CONSUMER, NON-CYCLICAL - 12.5%
Abbott Laboratories 5,075 237,409
Aetna, Inc. 6,700 176,746
Alberto-Culver Co. 2,500 67,725
Alexion Pharmaceuticals, Inc.* 2,700 138,213
Altria Group, Inc. 20,700 414,828
American Medical Systems* 2,700 59,724
American Reprographics Co.* 4,000 34,920
AmerisourceBergen Corp. 2,400 76,200
Amgen, Inc.* 6,900 362,940
Apollo Group, Inc.* 3,145 133,568
Arthrocare Corp.* 2,100 64,365
Automatic Data Processing 9,800 394,548
Avon Products, Inc. 17,500 463,750
Baxter International, Inc. 4,400 178,816
Biogen Idec, Inc.* 900 42,705
BioMarin Pharmaceutical, Inc.* 3,500 66,360
Brown-Forman Corp. 7,425 424,933
Bruker Corp.* 5,200 63,232
Campbell Soup Co. 11,800 422,794
CareFusion Corp.* 2,900 65,830
CONSUMER, NON-CYCLICAL - 12.5% (continued)
Cephalon, Inc.* 1,700 $ 96,475
Charles River Laboratories* 1,500 51,315
Church & Dwight Co., Inc. 2,400 150,504
CIGNA Corp. 9,200 285,752
Clorox Co. 7,400 459,984
Coca-Cola Co. 10,300 516,236
Colgate-Palmolive Co. 3,300 259,908
Community Health Systems* 2,100 71,001
Corporate Executive Board 2,100 55,167
Covance, Inc.* 1,000 51,320
CR Bard, Inc. 5,600 434,168
DaVita, Inc.* 1,950 121,758
Dendreon Corp.* 1,800 58,194
DENTSPLY International, Inc. 3,100 92,721
DeVry, Inc. 2,500 131,225
Diageo PLC - ADR 5,800 363,892
Education Management Corp.* 3,000 45,750
Edwards Lifesciences Corp.* 2,200 123,244
Elan Corp PLC - ADR* 8,700 39,150
Equifax, Inc. 2,200 61,732
General Mills, Inc. 7,600 269,952
Genpact Ltd* 4,100 63,673
Gen-Probe, Inc.* 800 36,336
Genzyme Corp.* 4,300 218,311
GlaxoSmithKline PLC - ADR 5,400 183,654
Global Payments, Inc. 1,600 58,464
Henry Schein, Inc.* 2,400 131,760
Hershey Co. 2,200 105,446
Hertz Global Holdings, Inc.* 9,900 93,654
Hewitt Associates, Inc.* 1,400 48,244
Hologic, Inc.* 3,700 51,541
Human Genome Sciences, Inc.* 3,300 74,778
Humana, Inc.* 1,100 50,237
IDEXX Laboratories, Inc.* 2,300 140,070
Illumina, Inc.* 2,600 113,178
Intuitive Surgical, Inc.* 500 157,810
Iron Mountain, Inc. 3,912 87,864
ITT Educational Services, Inc.* 800 66,416
JM Smucker Co. 1,400 84,308
Johnson & Johnson 16,500 974,490
Kellogg Co. 4,900 246,470
Kimberly-Clark Corp. 6,800 412,284
Laboratory Corp of America* 2,400 180,840
Life Technologies Corp.* 3,400 160,650
Lincare Holdings, Inc. 1,800 58,518
Lorillard, Inc. 7,800 561,444
See Notes To Financial Statements
-18-
ADVANCE CAPITAL I - BALANCED FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
CONSUMER, NON-CYCLICAL - 12.5% (continued)
Manpower, Inc. 1,100 $ 47,498
Masimo Corp.* 1,600 38,096
McCormick & Co., Inc. 13,100 497,276
McKesson Corp. 11,500 772,340
Mead Johnson Nutrition Co. 1,800 90,216
Medtronic, Inc. 7,100 257,517
Merck & Co., Inc. 12,100 423,137
Monster Worldwide, Inc.* 3,400 39,610
Moody's Corp. 16,500 328,680
Myriad Genetics, Inc.* 2,800 41,860
New Oriental Education - ADR* 700 65,233
Patterson Cos., Inc. 2,300 65,619
Paychex, Inc. 16,393 425,726
PepsiCo, Inc. 6,600 402,270
Perrigo Co. 1,200 70,884
Pfizer, Inc. 21,186 302,112
Philip Morris International, Inc. 16,500 756,360
Procter & Gamble Co. 15,500 929,690
QIAGEN NV* 2,500 48,050
Quanta Services, Inc.* 7,000 144,550
Quest Diagnostics, Inc. 7,988 397,563
Regeneron Pharmaceuticals* 2,200 49,104
ResMed, Inc.* 1,000 60,810
Ritchie Bros Auctioneers, Inc. 5,800 105,676
Robert Half International, Inc. 3,600 84,780
SEI Investments Co. 2,800 57,008
Shire PLC - ADR 1,500 92,070
St Jude Medical, Inc.* 2,400 86,616
Strayer Education, Inc. 300 62,367
Sysco Corp. 7,800 222,846
Techne Corp. 1,400 80,430
Teva Pharmaceutical - ADR 4,000 207,960
UnitedHealth Group, Inc. 8,600 244,240
Universal Health Services, Inc. 1,400 53,410
Varian Medical Systems, Inc.* 2,000 104,560
Verisk Analytics, Inc.* 2,300 68,770
Vertex Pharmaceuticals, Inc.* 3,950 129,955
VistaPrint NV* 1,400 66,486
Warner Chilcott PLC* 1,600 36,560
WellPoint, Inc.* 10,200 499,086
Western Union Co. 33,100 493,521
Whole Foods Market, Inc.* 4,500 162,090
Zimmer Holdings, Inc.* 5,100 275,655
ENERGY - 7.2%
Apache Corp. 2,300 193,637
Arch Coal, Inc. 3,759 74,466
ENERGY - 7.2% (continued)
Atlas Energy, Inc.* 1,700 $ 46,019
Baker Hughes, Inc. 5,600 232,792
Cabot Oil & Gas Corp. 1,400 43,848
Cameron International Corp.* 5,600 182,112
Chevron Corp. 32,042 2,174,370
Cobalt International Energy* 3,600 26,820
Concho Resources, Inc.* 3,600 199,188
ConocoPhillips 8,700 427,083
Consol Energy, Inc. 1,400 47,264
Continental Resources, Inc.* 1,700 75,854
Core Laboratories 1,100 162,371
Devon Energy Corp. 3,200 194,944
Diamond Offshore Drilling, Inc. 7,200 447,768
Dresser-Rand Group, Inc.* 2,000 63,100
Dril-Quip, Inc.* 1,100 48,422
EOG Resources, Inc. 2,600 255,762
Exxon Mobil Corp. 22,802 1,301,310
First Solar, Inc.* 500 56,915
FMC Technologies, Inc.* 3,300 173,778
Forest Oil Corp.* 12,900 352,944
Hess Corp. 4,000 201,360
Massey Energy Co. 1,500 41,025
Murphy Oil Corp. 5,400 267,570
Nabors Industries Ltd* 2,700 47,574
Newfield Exploration Co.* 5,500 268,730
Occidental Petroleum Corp. 6,100 470,615
Oceaneering International, Inc.* 1,800 80,820
Peabody Energy Corp. 14,100 551,733
Range Resources Corp. 1,600 64,240
Royal Dutch Shell PLC - ADR 21,200 1,064,664
SandRidge Energy, Inc.* 3,500 20,405
Schlumberger Ltd 12,960 717,206
Southwestern Energy Co.* 1,700 65,688
Tetra Technologies, Inc.* 5,700 51,756
Total SA - ADR 16,000 714,240
Ultra Petroleum Corp.* 6,700 296,475
Walter Energy, Inc. 7,700 468,545
FINANCIAL - 9.3%
Aflac, Inc. 6,600 281,622
AON Corp. 10,100 374,912
Arch Capital Group Ltd* 4,800 357,600
Artio Global Investors, Inc. 1,600 25,184
Assurant, Inc. 1,200 41,640
AvalonBay Communities, Inc. 2,294 214,191
Axis Capital Holdings Ltd 2,000 59,440
Bank of America Corp. 14,400 206,928
See Notes to Financial Statements
-19-
ADVANCE CAPITAL I - BALANCED FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
FINANCIAL - 9.3% (continued)
Bank of New York 18,171 $ 448,642
BB&T Corp. 16,500 434,115
CBOE Holdings, Inc.* 3,600 117,180
Chubb Corp. 10,900 545,109
Citigroup, Inc.* 86,600 325,616
City National Corp. 5,800 297,134
CME Group, Inc. 1,400 394,170
Eaton Vance Corp. 4,100 113,201
Equity Residential 7,200 299,808
Essex Property Trust, Inc. 3,000 292,620
Federal Realty Investment 5,400 379,458
Federated Investors, Inc. 12,500 258,875
Fifth Third Bancorp 22,700 278,983
First Horizon National Corp.* 5,361 61,387
Forest City Enterprises, Inc.* 5,200 58,864
HCC Insurance Holdings, Inc. 10,700 264,932
Interactive Brokers Group, Inc.* 3,100 51,460
IntercontinentalExchange, Inc.* 1,700 192,151
Janus Capital Group, Inc. 9,100 80,808
JPMorgan Chase & Co. 46,800 1,713,348
KeyCorp 36,800 282,992
Lazard Ltd 3,200 85,472
Marshall & Ilsley Corp. 51,400 369,052
Northern Trust Corp. 8,900 415,630
NYSE Euronext 18,700 516,681
optionsXpress Holdings, Inc.* 4,300 67,682
PNC Financial Services Group 10,800 610,200
Popular, Inc.* 28,899 77,449
Principal Financial Group, Inc. 3,200 75,008
Progressive Corp. 13,900 260,208
Public Storage 4,000 351,640
Regions Financial Corp. 62,900 413,882
RenaissanceRe Holdings Ltd 5,600 315,112
Simon Property Group, Inc. 3,058 246,934
SLM Corp.* 29,200 303,388
State Street Corp. 5,800 196,156
SunTrust Banks, Inc. 9,300 216,690
SVB Financial Group* 1,300 53,599
TCF Financial Corp. 3,800 63,118
TD Ameritrade Holding Corp.* 8,800 134,640
Travelers Cos., Inc. 9,300 458,025
US Bancorp 34,528 771,701
Waddell & Reed Financial, Inc. 2,200 48,136
Wells Fargo & Co. 51,260 1,312,256
WR Berkley Corp. 2,300 60,858
Zions Bancorporation 1,900 40,983
INDUSTRIAL - 8.0%
3M Co. 4,700 $ 371,253
Alliant Techsystems, Inc.* 4,200 260,652
AMETEK, Inc. 3,500 140,525
Amphenol Corp. 2,800 109,984
Boeing Co. 11,540 724,135
Bucyrus International, Inc. 800 37,960
Caterpillar, Inc. 6,800 408,476
CH Robinson Worldwide, Inc. 3,600 200,376
CLARCOR, Inc. 1,700 60,384
Cogent, Inc.* 4,100 36,941
Cooper Industries PLC 11,800 519,200
CSX Corp. 8,800 436,744
Cummins, Inc. 1,500 97,695
Cymer, Inc.* 1,600 48,064
Dolby Laboratories, Inc.* 2,300 144,187
Donaldson Co., Inc. 2,500 106,625
Elbit Systems Ltd 1,100 55,308
Emerson Electric Co. 17,200 751,468
Empresa Brasileira - ADR 12,800 268,160
Expeditors International 5,500 189,805
FLIR Systems, Inc.* 2,200 63,998
Flowserve Corp. 3,600 305,280
Fluor Corp. 5,100 216,750
Foster Wheeler AG* 4,700 98,982
General Cable Corp.* 2,500 66,625
General Dynamics Corp. 5,900 345,504
Gentex Corp. 3,400 61,132
Goodrich Corp. 6,500 430,625
Graco, Inc. 2,100 59,199
Harsco Corp. 1,700 39,950
Honeywell International, Inc. 7,600 296,628
IDEX Corp. 2,025 57,854
II-VI, Inc.* 2,100 62,223
Illinois Tool Works, Inc. 8,600 355,008
Itron, Inc.* 800 49,456
ITT Corp. 5,300 238,076
Jabil Circuit, Inc. 4,800 63,840
Joy Global, Inc. 10,500 525,945
Landstar System, Inc. 3,200 124,768
Lockheed Martin Corp. 3,100 230,950
McDermott International, Inc.* 21,600 467,856
Mettler-Toledo International, Inc.* 1,200 133,956
National Instruments Corp. 2,550 81,039
Northrop Grumman Corp. 4,000 217,760
Pall Corp. 1,900 65,303
See Notes to Financial Statements
-20-
ADVANCE CAPITAL I - BALANCED FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
INDUSTRIAL - 8.0% (continued)
Precision Castparts Corp. 2,600 $ 267,592
Republic Services, Inc. 25,050 744,737
Rockwell Automation, Inc. 6,300 309,267
Rockwell Collins, Inc. 2,800 148,764
Roper Industries, Inc. 1,600 89,536
Stericycle, Inc.* 2,000 131,160
Terex Corp.* 3,000 56,220
TransDigm Group, Inc.* 1,300 66,339
Trimble Navigation Ltd* 5,400 151,200
Union Pacific Corp. 10,800 750,708
United Parcel Service, Inc. 7,100 403,919
United Technologies Corp. 7,200 467,352
Valmont Industries, Inc. 900 65,394
Wabtec Corp. 1,600 63,824
Waste Connections, Inc.* 1,800 62,802
Waters Corp.* 2,100 135,870
Zebra Technologies Corp.* 1,700 43,129
TECHNOLOGY - 6.2%
Accenture PLC 12,600 486,990
Adobe Systems, Inc.* 2,000 52,860
Altera Corp. 7,700 191,037
Analog Devices, Inc. 13,600 378,896
ANSYS, Inc.* 3,000 121,710
Autodesk, Inc.* 4,400 107,184
BMC Software, Inc.* 3,400 117,742
Broadcom Corp. 2,200 72,534
CA, Inc. 6,400 117,760
Cerner Corp.* 1,900 144,191
Check Point Software* 1,800 53,064
Citrix Systems, Inc.* 3,200 135,136
Cognizant Technology* 3,836 192,030
Computer Sciences Corp. 6,100 276,025
Dell, Inc.* 15,100 182,106
Dun & Bradstreet Corp. 900 60,408
Electronic Arts, Inc.* 3,200 46,080
EMC Corp.* 25,400 464,820
Fairchild Semiconductor* 3,800 31,958
Fidelity National Information 2,400 64,368
Fiserv, Inc.* 1,650 75,339
GT Solar International, Inc.* 9,500 53,200
Informatica Corp.* 2,700 64,476
Intel Corp. 50,500 982,225
International Business Machines 7,400 913,752
Intersil Corp. 3,600 43,596
Intuit, Inc.* 6,700 232,959
Jack Henry & Associates, Inc. 2,300 54,924
TECHNOLOGY - 6.2% (continued)
KLA-Tencor Corp. 1,600 $ 44,608
Lam Research Corp.* 2,200 83,732
Linear Technology Corp. 14,400 400,464
Logitech International* 4,300 57,663
Marvell Technology Group* 11,100 174,936
Maxim Integrated Products, Inc. 3,100 51,863
MEMC Electronic Materials, Inc.* 6,400 63,232
Microchip Technology, Inc. 12,612 349,857
MICROS Systems, Inc.* 3,300 105,171
Microsoft Corp. 47,700 1,097,577
MSCI, Inc.* 3,600 98,640
National Semiconductor Corp. 24,000 323,040
NetApp, Inc.* 5,300 197,743
Nuance Communications, Inc.* 5,500 82,225
NVIDIA Corp.* 14,000 142,940
ON Semiconductor Corp.* 12,900 82,302
Oracle Corp. 10,900 233,914
QLogic Corp.* 3,900 64,818
Red Hat, Inc.* 5,100 147,594
Rovi Corp.* 3,400 128,894
Salesforce.com, Inc.* 1,400 120,148
Seagate Technology* 11,100 144,744
Silicon Laboratories, Inc.* 2,200 89,232
Solera Holdings, Inc. 2,500 90,500
Synopsys, Inc.* 2,700 56,349
Texas Instruments, Inc. 9,200 214,176
Varian Semiconductor* 3,900 111,774
Xilinx, Inc. 6,700 169,242
UTILITIES - 2.7%
Calpine Corp.* 10,800 137,376
Consolidated Edison, Inc. 7,200 310,320
Duke Energy Corp. 24,500 392,000
Entergy Corp. 4,000 286,480
Exelon Corp. 7,550 286,674
NextEra Energy, Inc. 5,700 277,932
NRG Energy, Inc.* 17,000 360,570
Pepco Holdings, Inc. 14,400 225,792
Pinnacle West Capital Corp. 6,600 239,976
Progress Energy, Inc. 10,300 403,966
SCANA Corp. 15,600 557,856
Southern Co. 19,300 642,304
TECO Energy, Inc. 15,800 238,106
------------
TOTAL COMMON STOCK - 60.9%
(Cost $100,402,216) $ 103,670,682
------------
* Securities are non-income producing
ADR - American Depository Receipt
See Notes to Financial Statements
-21-
ADVANCE CAPITAL I - BALANCED FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
Principal
Fixed Income Securities Coupon Maturity Amount Value
- ----------------------------------------------------------------------------------------------
BASIC MATERIALS - 2.0%
ArcelorMittal 6.125 06/01/2018 $ 1,000,000 $ 1,045,880
Barrick Gold Corp. 6.950 04/01/2019 1,500,000 1,798,559
BHP Billiton Finance USA Ltd 7.250 03/01/2016 500,000 595,348
COMMUNICATIONS - 5.5%
British Telecommunications PLC 9.875 12/15/2030 1,000,000 1,220,419
Cisco Systems, Inc. 4.450 01/15/2020 1,000,000 1,055,624
Comcast Holdings Corp. 10.625 07/15/2012 2,000,000 2,327,522
Michigan Bell Telephone Co. 7.850 01/15/2022 2,000,000 2,387,190
Verizon New Jersey, Inc. 8.000 06/01/2022 650,000 790,320
Vodafone Group PLC 5.375 01/30/2015 1,500,000 1,637,889
CONSUMER, CYCLICAL - 0.6%
Macy's Retail Holdings, Inc. 7.450 09/15/2011 1,000,000 1,040,000
CONSUMER, NON-CYCLICAL - 2.8%
Genentech, Inc. 4.750 07/15/2015 1,000,000 1,106,434
Pfizer, Inc. 7.200 03/15/2039 1,500,000 1,971,869
Roche Holdings, Inc.^ 6.000 03/01/2019 1,500,000 1,747,340
ENERGY - 3.7%
ConocoPhillips 6.500 02/01/2039 1,000,000 1,207,619
Marathon Oil Canada Corp. 8.375 05/01/2012 1,350,000 1,499,461
Shell International Finance 4.300 09/22/2019 1,000,000 1,031,984
Statoil ASA 7.500 10/01/2016 1,000,000 1,229,711
TransCanada PipeLines Ltd 7.125 01/15/2019 1,000,000 1,215,536
FINANCIAL - 5.2%
Berkshire Hathaway Finance 5.400 05/15/2018 1,000,000 1,110,676
CitiFinancial, Inc. 6.625 06/01/2015 1,250,000 1,336,441
General Electric Capital Corp. 5.625 05/01/2018 1,000,000 1,062,714
Goldman Sachs Group, Inc. 5.950 01/18/2018 1,000,000 1,038,713
HSBC Finance Corp. 6.375 11/27/2012 1,000,000 1,079,939
Morgan Stanley 5.950 12/28/2017 1,000,000 1,012,660
National Rural Utilities Cooperative 10.375 11/01/2018 1,500,000 2,080,008
GOVERNMENT - 2.6%
Federal Home Loan Banks 5.375 05/15/2019 1,000,000 1,152,813
Federal Home Loan Banks 4.125 12/13/2019 1,000,000 1,047,188
Federal Home Loan Banks 4.125 03/13/2020 1,000,000 1,052,813
Federal National Mortgage 4.600 06/05/2018 1,000,000 1,110,313
INDUSTRIAL - 2.4%
Boeing Co. 4.875 02/15/2020 1,000,000 1,101,048
Burlington Northern Santa Fe LLC 5.750 03/15/2018 1,000,000 1,123,104
Clark Equipment Co. 8.000 05/01/2023 500,000 561,238
United Parcel Service of America 8.375 04/01/2020 1,000,000 1,379,906
MORTGAGE SECURITIES - 4.2%
Chase Mortgage Finance Corp. 6.500 05/25/2036 977,678 716,225
Countrywide Alternative Loan 6.000 06/25/2037 1,483,134 189,787
See Notes to Financial Statements
-22-
ADVANCE CAPITAL I - BALANCED FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
Fixed Income Securities Principal
and Short-Term Investments Coupon Maturity Amount Value
- ----------------------------------------------------------------------------------------------
MORTGAGE SECURITIES - 4.2% (continued)
Fannie Mae Pool 7.000 04/01/2033 $ 496,116 $ 553,675
Freddie Mac Gold Pool 6.500 06/01/2024 459,480 508,452
Freddie Mac Gold Pool 7.000 10/01/2031 715,321 812,724
Freddie Mac Gold Pool 6.500 02/01/2032 837,834 932,011
Freddie Mac Gold Pool 6.500 08/01/2032 542,007 602,932
Freddie Mac Gold Pool 6.500 12/01/2032 838,313 939,610
Freddie Mac Gold Pool 6.500 04/01/2033 376,727 419,309
Lehman Mortgage Trust 6.000 09/25/2036 1,018,318 444,385
MASTR Asset Securitization Trust 6.250 05/25/2036 579,411 515,184
Residential Asset Securitization 6.500 06/25/2037 1,358,388 565,792
TECHNOLOGY - 0.7%
Oracle Corp. 5.750 04/15/2018 1,000,000 1,157,674
UTILITIES - 6.6%
Commonwealth Edison Co. 5.800 03/15/2018 1,000,000 1,129,899
Consumers Energy Co. 6.700 09/15/2019 2,000,000 2,392,542
Entergy Gulf States, Inc. 5.250 08/01/2015 806,000 807,060
Illinois Power Co. 9.750 11/15/2018 1,000,000 1,312,885
Michigan Consolidated Gas Co. 8.250 05/01/2014 1,050,000 1,233,148
PSEG Power LLC 5.500 12/01/2015 2,000,000 2,211,350
South Carolina Electric & Gas Co. 6.500 11/01/2018 1,000,000 1,194,676
United Utilities PLC 5.375 02/01/2019 1,000,000 1,018,651
----------------
TOTAL FIXED-INCOME SECURITIES - 36.3%
(Cost $61,391,766) 61,816,250
SHORT-TERM INVESTMENTS - 0.5%
Fifth Third Institutional Money Market Fund, 0.13% Yield
(Cost $949,257) 949,257
----------------
TOTAL INVESTMENTS IN SECURITIES - 97.7%
(Cost $162,743,239) 166,436,189
OTHER ASSETS LESS LIABILITIES - 2.3% 3,934,741
----------------
TOTAL NET ASSETS - 100.0% $ 170,370,930
================
^Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities are considered liquid and may be resold
in transactions exempt from registration. At June 30, 2010, the
aggregate market value of these securities amounted to $1,747,340
or 1.03% of net assets.
See Notes to Financial Statements
-23-
ADVANCE CAPITAL I - RETIREMENT INCOME FUND
SUMMARY OF PORTFOLIO HOLDINGS (Unaudited)
JUNE 30, 2010
[EDGAR REFERENCE - PIE CHART FOR SUMMARY OF PORTFOLIO
HOLDINGS AS OF JUNE 30, 2010]
Investment Grade 55.5%
High Yield 21.1%
Government Agency 14.8%
Common Stock 3.9%
Cash & Other Assets 1.0%
Mortgage-Backed 3.7%
Top Ten Holdings*
Federal Home Loan Banks 5.365% 2024 1.48%
Carolina Power & Light Co. 8.625% 2021 1.33%
WellPoint, Inc. 5.875% 2017 1.25%
Wal-Mart Stores, Inc. 6.750% 2023 1.20%
Statoil Asa 7.500% 2016 1.19%
AstraZeneca PLC 6.450% 2037 1.17%
Consumers Energy Co. 6.700% 2019 1.15%
Michigan Bell Telephone Co. 7.850% 2022 1.15%
Federal Home Loan Banks 5.625% 2021 1.14%
Roche Holdings, Inc. 6.000% 2019 1.12%
* Percentages based on Total Net Assets
-24-
ADVANCE CAPITAL I - RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
Principal
Fixed Income Securities Coupon Maturity Amount Value
- ----------------------------------------------------------------------------------------------
BASIC MATERIALS - 5.6%
ArcelorMittal 6.125 06/01/2018 $ 2,500,000 $ 2,614,702
Barrick Gold Corp. 6.950 04/01/2019 2,500,000 2,997,598
Freeport-McMoRan 8.250 04/01/2015 3,000,000 3,255,000
Newmont Mining Corp. 5.125 10/01/2019 3,000,000 3,214,581
Steel Dynamics, Inc. 7.375 11/01/2012 3,000,000 3,105,000
Teck Resources Ltd 9.750 05/15/2014 2,000,000 2,363,632
COMMUNICATIONS - 10.0%
Cisco Systems, Inc. 4.450 01/15/2020 3,000,000 3,166,872
Comcast Cable Communications 8.500 05/01/2027 1,000,000 1,236,296
Comcast Holdings Corp. 10.625 07/15/2012 1,500,000 1,745,642
GTE Corp. 8.750 11/01/2021 1,500,000 1,965,807
Liberty Media LLC 5.700 05/15/2013 3,000,000 3,067,500
Michigan Bell Telephone Co. 7.850 01/15/2022 3,000,000 3,580,785
News America Holdings, Inc. 8.500 02/23/2025 2,300,000 2,846,289
Qwest Corp. 7.625 06/15/2015 3,000,000 3,210,000
TW, Inc. 9.150 02/01/2023 2,000,000 2,692,610
Verizon New Jersey, Inc. 8.000 06/01/2022 1,000,000 1,215,877
Viacom, Inc. 6.250 04/30/2016 3,000,000 3,402,744
Virgin Media Secured Finance* 6.500 01/15/2018 3,000,000 2,947,500
CONSUMER, CYCLICAL - 4.1%
GameStop Corp. 8.000 10/01/2012 3,000,000 3,082,500
Royal Caribbean Cruises Ltd 7.250 06/15/2016 3,000,000 2,932,500
Wal-Mart Stores, Inc. 6.750 10/15/2023 3,000,000 3,743,238
Wynn Las Vegas LLC 6.625 12/01/2014 2,000,000 2,005,000
Wynn Las Vegas LLC 6.625 12/01/2014 1,000,000 1,002,500
CONSUMER, NON-CYCLICAL - 8.7%
AstraZeneca PLC 6.450 09/15/2037 3,000,000 3,635,408
Corrections Corp of America 7.750 06/01/2017 3,000,000 3,112,500
HCA, Inc. 9.250 11/15/2016 3,000,000 3,180,000
Pfizer, Inc. 7.200 03/15/2039 2,500,000 3,286,448
Procter & Gamble Co. 4.700 02/15/2019 3,000,000 3,287,370
Roche Holdings, Inc.* 6.000 03/01/2019 3,000,000 3,494,679
UnitedHealth Group, Inc. 5.375 03/15/2016 3,000,000 3,260,277
WellPoint, Inc. 5.875 06/15/2017 3,500,000 3,899,217
ENERGY - 8.9%
Chesapeake Energy Corp. 7.250 12/15/2018 3,155,000 3,257,538
ConocoPhillips 6.500 02/01/2039 2,000,000 2,415,238
Husky Energy, Inc. 6.200 09/15/2017 2,575,000 2,903,037
Pride International, Inc. 7.375 07/15/2014 2,000,000 1,992,500
Shell International Finance 4.300 09/22/2019 3,000,000 3,095,952
Statoil ASA 7.500 10/01/2016 3,000,000 3,689,133
Sunoco, Inc. 5.750 01/15/2017 2,500,000 2,526,488
See Notes to Financial Statements
-25-
ADVANCE CAPITAL I - RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
Principal
Fixed Income Securities Coupon Maturity Amount Value
- ----------------------------------------------------------------------------------------------
ENERGY - 8.9% (continued)
TransCanada PipeLines Ltd 7.125 01/15/2019 $ 2,000,000 $ 2,431,072
Ultramar Diamond Shamrock 7.200 10/15/2017 2,250,000 2,451,836
Weatherford International, Inc. 6.350 06/15/2017 3,000,000 3,161,652
FINANCIAL - 19.5%
Berkshire Hathaway Finance 5.400 05/15/2018 3,000,000 3,332,031
Citigroup, Inc. 6.125 11/21/2017 2,000,000 2,088,620
Fairfax Financial Holdings Ltd 7.750 06/15/2017 3,000,000 3,075,000
Farmers Insurance Exchange* 8.625 05/01/2024 2,000,000 2,227,328
General Electric Capital Corp. 6.750 03/15/2032 3,000,000 3,228,711
Goldman Sachs Group, Inc. 6.150 04/01/2018 3,000,000 3,142,551
Hospitality Properties Trust 5.625 03/15/2017 1,000,000 957,467
Host Hotels & Resorts LP 6.875 11/01/2014 3,500,000 3,491,250
HSBC USA Capital Trust II* 8.380 05/15/2027 1,000,000 999,826
HSBC Finance Corp. 6.375 11/27/2012 1,000,000 1,079,939
Icahn Enterprises LP* 7.750 01/15/2016 3,000,000 2,917,500
Invesco Ltd 5.375 02/27/2013 2,000,000 2,086,119
JPMorgan Chase & Co. 4.950 03/25/2020 3,000,000 3,117,750
Merrill Lynch & Co., Inc. 6.875 04/25/2018 3,000,000 3,200,343
MetLife, Inc. 6.750 06/01/2016 1,000,000 1,131,349
Morgan Stanley 5.950 12/28/2017 3,000,000 3,037,980
National Rural Utilities Cooperative 10.375 11/01/2018 2,500,000 3,466,680
Nationsbank Corp. 10.200 07/15/2015 1,000,000 1,199,281
New England Mutual Life Insurance 7.875 02/15/2024 1,650,000 1,879,437
Omega Healthcare Investors, Inc. 7.000 04/01/2014 3,000,000 2,992,500
Security Benefit Life Insurance* 8.750 05/15/2016 2,000,000 1,745,000
Travelers Property Casualty Corp. 7.750 04/15/2026 2,000,000 2,590,672
UBS AG 3.875 01/15/2015 2,000,000 1,990,100
Union Planters Corp. 7.750 03/01/2011 2,604,000 2,640,089
Wachovia Corp. 5.750 02/01/2018 3,000,000 3,286,644
GOVERNMENT - 10.2%
Chicago Board of Education 6.138 12/01/2039 1,000,000 1,035,280
City of New York, NY 5.676 10/01/2034 2,000,000 1,900,880
Federal Farm Credit Bank 4.670 02/27/2018 3,000,000 3,322,500
Federal Farm Credit Bank 5.050 08/01/2018 1,000,000 1,130,938
Federal Home Loan Banks 5.375 05/15/2019 2,640,000 3,043,425
Federal Home Loan Banks 4.125 12/13/2019 3,000,000 3,141,563
Federal Home Loan Banks 4.125 03/13/2020 3,000,000 3,158,438
Federal Home Loan Banks 5.625 06/11/2021 3,000,000 3,531,563
Federal Home Loan Banks 5.375 09/30/2022 2,000,000 2,332,500
Federal Home Loan Banks 5.375 08/15/2024 1,000,000 1,161,250
Federal Home Loan Banks 5.365 09/09/2024 4,000,000 4,597,500
Federal Home Loan Banks 5.750 06/12/2026 2,000,000 2,371,250
Federal National Mortgage 4.600 06/05/2018 1,000,000 1,110,313
See Notes to Financial Statements
-26-
ADVANCE CAPITAL I - RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
Principal
Fixed Income Securities Coupon Maturity Amount Value
- ----------------------------------------------------------------------------------------------
INDUSTRIAL - 5.0%
Case New Holland, Inc. 7.750 09/01/2013 $ 2,500,000 $ 2,556,250
Caterpillar, Inc. 6.050 08/15/2036 2,000,000 2,300,976
Clark Equipment Co. 8.000 05/01/2023 500,000 561,238
Federal Express Corp. 9.650 06/15/2012 1,047,000 1,189,947
Gulfmark Offshore, Inc. 7.750 07/15/2014 2,375,000 2,256,250
Koninklijke Philips Electronics 7.250 08/15/2013 1,000,000 1,148,028
L-3 Communications Corp. 5.875 01/15/2015 3,000,000 2,962,500
United Parcel Service of America 8.375 04/01/2020 2,000,000 2,759,812
MORTGAGE SECURITIES - 8.2%
Banc of America Alternative Loan 6.000 11/25/2046 1,172,519 588,317
Banc of America Funding Corp. 6.000 03/25/2037 1,800,674 714,520
Banc of America Mortgage 6.000 05/25/2037 1,922,211 741,729
Chase Mortgage Finance Corp. 6.500 05/25/2036 1,729,322 1,266,861
Countrywide Alternative Loan 5.500 09/25/2035 1,552,926 911,917
Countrywide Alternative Loan 6.250 07/25/2036 718,264 212,917
Countrywide Alternative Loan 6.000 07/25/2036 443,376 92,066
Countrywide Alternative Loan 6.000 12/25/2036 960,934 442,117
Countrywide Alternative Loan 6.000 05/25/2037 1,881,334 313,880
Countrywide Alternative Loan 6.000 05/25/2037 1,623,862 174,807
Countrywide Alternative Loan 6.000 06/25/2037 2,224,701 284,682
Countrywide Home Loan Mortgage 5.750 05/25/2037 1,385,260 624,140
Credit Suisse Mortgage Capital 6.500 03/25/2036 618,752 354,595
Credit Suisse Mortgage Capital 6.250 06/25/2036 1,772,886 818,963
Fannie Mae Pool 7.000 02/01/2032 1,095,274 1,240,011
Fannie Mae Pool 7.000 03/01/2032 1,052,002 1,189,533
Fannie Mae Pool 7.000 04/01/2033 775,977 866,004
Freddie Mac Gold Pool 6.500 06/01/2024 1,072,119 1,186,389
Freddie Mac Gold Pool 7.000 10/01/2031 1,220,755 1,386,980
Freddie Mac Gold Pool 6.500 02/01/2032 1,341,845 1,492,677
Freddie Mac Gold Pool 7.000 05/01/2032 1,723,695 1,960,419
Freddie Mac Gold Pool 6.500 08/01/2032 722,676 803,909
Freddie Mac Gold Pool 6.500 04/01/2033 1,130,182 1,257,928
Freddie Mac Gold Pool 7.000 09/01/2033 338,618 382,362
Freddie Mac Gold Pool 6.500 10/01/2038 2,270,090 2,491,438
Lehman Mortgage Trust 6.408 04/25/2036 1,327,602 986,293
Lehman Mortgage Trust 6.000 09/25/2036 1,875,356 818,389
Lehman Mortgage Trust 6.323 06/25/2037 929,750 93,528
MASTR Alternative Loans Trust 6.500 12/25/2033 191,086 178,890
Merrill Lynch Mortgage Investors 6.250 10/25/2036 2,055,061 824,412
Residential Asset Securitization 6.500 06/25/2037 2,443,659 1,017,826
TECHNOLOGY - 2.0%
Oracle Corp. 5.750 04/15/2018 3,000,000 3,473,022
Xerox Corp. 7.625 06/15/2013 2,500,000 2,543,800
See Notes to Financial Statements
-27-
ADVANCE CAPITAL I - RETIREMENT INCOME FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
Fixed Income Securities, Common Stock Shares/
and Short-Term Investments Coupon Maturity Principal Value
- ----------------------------------------------------------------------------------------------
UTILITIES - 12.5%
AES Corp.* 8.750 05/15/2013 $ 1,256,000 $ 1,274,839
Calpine Construction Finance Co.* 8.000 06/01/2016 3,000,000 3,067,500
Carolina Power & Light Co. 8.625 09/15/2021 3,000,000 4,141,779
Commonwealth Edison Co. 6.150 09/15/2017 2,155,000 2,473,410
Consumers Energy Co. 6.700 09/15/2019 3,000,000 3,588,813
Duke Energy Corp. 5.050 09/15/2019 3,000,000 3,198,972
Entergy Louisiana LLC 5.090 11/01/2014 2,500,000 2,504,600
Illinois Power Co. 9.750 11/15/2018 2,000,000 2,625,770
PSEG Power LLC 5.500 12/01/2015 2,000,000 2,211,350
CenterPoint Energy Houston 9.150 03/15/2021 2,300,000 3,093,546
Sempra Energy 6.500 06/01/2016 3,000,000 3,442,494
South Carolina Electric & Gas Co. 6.500 11/01/2018 2,000,000 2,389,352
Southern Co Capital Funding, Inc. 5.750 11/15/2015 2,000,000 2,028,794
United Utilities PLC 5.375 02/01/2019 3,000,000 3,055,953
-----------------
TOTAL FIXED INCOME SECURITIES - 94.7%
(Cost $299,089,361) 295,783,579
COMMON STOCK - 3.9%
Altria Group, Inc. 103,400 2,072,136
Johnson & Johnson 33,300 1,966,698
Kimberly-Clark Corp. 34,700 2,103,861
Kraft Foods, Inc. 70,800 1,982,400
PepsiCo, Inc. 32,400 1,974,780
Procter & Gamble Co. 33,700 2,021,326
-----------------
TOTAL COMMON STOCK - 3.9%
(Cost $12,865,590) 12,121,201
SHORT-TERM INVESTMENTS - 0.0%
Fifth Third Institutional Money Market Fund, 0.13% Yield
(Cost $79,374) 79,374
-----------------
TOTAL INVESTMENTS IN SECURITIES - 98.6%
(Cost $312,034,325) 307,984,154
OTHER ASSETS LESS LIABILITIES - 1.4% 4,252,810
-----------------
TOTAL NET ASSETS - 100.0% $ 312,236,964
=================
*Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities are considered
liquid and may be resold in transactions exempt from
registration. At June 30, 2010, the aggregate market value
of these securities amounted to $18,674,172 or 5.98% of
net assets.
See Notes to Financial Statements
-28-
ADVANCE CAPITAL I - CORE EQUITY FUND
SUMMARY OF PORTFOLIO HOLDINGS (Unaudited)
JUNE 30, 2010
[EDGAR REFERENCE - PIE CHART FOR SUMMARY OF PORTFOLIO
HOLDINGS AS OF JUNE 30, 2010]
Technology 14.6%
Financial 19.5%
Consumer Cyclical 3.5%
Communications 18.0%
Consumer Non-Cyclical 18.9%
Energy 11.0%
Cash & Other Assets 3.3%
Basic Materials 1.8%
Industrial 9.4%
Top Ten Holdings*
Liberty Media Corp-Capital 4.34%
Berkshire Hathaway, Inc. 3.75%
Johnson & Johnson 3.55%
Wal-Mart Stores, Inc. 3.51%
International Business Machines 3.10%
Conoco Phillips 2.91%
Altria Group, Inc. 2.85%
Microsoft Corp. 2.80%
Northrop Grumman Corp. 2.73%
JPMorgan Chase & Co. 2.72%
* Percentages based on Total Net Assets
-29-
ADVANCE CAPITAL I - CORE EQUITY FUND
PORTFOLIO OF INVESTMENTS (Unaudited)
JUNE 30, 2010
COMMON STOCK SHARES VALUE
- --------------------------------------------------------
BASIC MATERIALS - 1.8%
Freeport-McMoRan 1,620 $ 95,791
Mosaic Co. 1,735 67,630
COMMUNICATIONS - 18.0%
AT&T, Inc. 8,785 212,509
Cisco Systems, Inc.* 10,485 223,435
Harris Corp. 3,005 125,158
Liberty Media Corp - Starz* 4,633 240,175
Liberty Media Corp - Capital* 9,455 396,259
Symantec Corp.* 16,680 231,518
Time Warner, Inc. 7,431 214,830
CONSUMER, CYCLICAL - 3.5%
Wal-Mart Stores, Inc. 6,670 320,627
CONSUMER, NON-CYCLICAL - 18.9%
Altria Group, Inc. 12,975 260,019
Eli Lilly & Co. 5,465 183,077
Forest Laboratories, Inc.* 5,490 150,591
Johnson & Johnson 5,485 323,944
Kimberly-Clark Corp. 2,535 153,697
Kraft Foods, Inc. 6,545 183,260
Pfizer, Inc. 15,345 218,820
Philip Morris International, Inc. 2,655 121,705
UnitedHealth Group, Inc. 4,955 140,722
ENERGY - 11.0%
Apache Corp. 1,010 85,032
Chevron Corp. 3,610 244,975
ConocoPhillips 5,420 266,068
Devon Energy Corp. 1,430 87,116
National Oilwell Varco, Inc. 3,300 109,131
Noble Corp.* 3,370 104,167
Valero Energy Corp. 5,895 105,992
FINANCIAL - 19.5%
ACE Ltd 4,450 229,086
American Express Co. 3,055 121,283
Bank of America Corp. 15,410 221,442
Berkshire Hathaway, Inc.* 4,291 341,950
Citigroup, Inc.* 34,605 130,115
HCC Insurance Holdings, Inc. 4,980 123,305
JPMorgan Chase & Co. 6,795 248,765
COMMON STOCK AND
SHORT-TERM INVESTMENTS SHARES VALUE
- --------------------------------------------------------
FINANCIAL - 19.5% (continued)
Loews Corp. 6,650 $ 221,511
Travelers Cos., Inc. 2,870 141,348
INDUSTRIAL - 9.4%
Boeing Co. 3,030 190,132
Foster Wheeler AG* 4,055 85,398
General Dynamics Corp. 2,840 166,310
L-3 Communications Holdings 2,405 170,370
Northrop Grumman Corp. 4,580 249,335
TECHNOLOGY - 14.6%
Check Point Software* 5,810 171,279
Computer Sciences Corp. 3,475 157,244
EMC Corp.* 12,965 237,259
International Business Machines 2,295 283,387
Microsoft Corp. 11,110 255,641
Oracle Corp. 10,695 229,515
-------------
TOTAL COMMON STOCK - 96.7%
(Cost $9,384,031) 8,840,923
SHORT-TERM INVESTMENTS - 3.0%
Fifth Third Inst. Money Mkt Fund, 0.13% Yield
(Cost $274,141) 274,141
-------------
TOTAL INVESTMENTS IN SECURITIES - 99.7%
(Cost $9,658,172) 9,115,064
OTHER ASSETS LESS LIABILITIES - 0.3% 26,656
-------------
TOTAL NET ASSETS - 100.0% $ 9,141,720
=============
*Securities are non-income producing
See Notes to Financial Statements
-30-
ADVANCE CAPITAL I, INC.
STATEMENTS OF ASSETS AND LIABILITIES (Unaudited)
JUNE 30, 2010
EQUITY BALANCED RETIREMENT CORE EQUITY
GROWTH FUND FUND INCOME FUND FUND
--------------- ------------- ------------- --------------
ASSETS
Investments in securities at value $ 87,922,012 $ 166,436,189 $ 307,984,154 $ 9,115,064
(Cost $88,820,078; $162,743,239;
$312,034,325; $9,658,172,
respectively)
Cash 8,693 5,108 0 0
Receivables
Dividends and interest 48,298 990,582 4,023,557 12,628
Securities sold 537,631 1,963,205 1,267,687 0
Capital shares receivable 515 2,218 36,597 11,640
Note receivable from adviser 1,663,846 1,749,298 57,799 0
Prepaid expenses 10,625 13,047 16,776 4,678
-------------- ------------- ------------- -------------
Total assets 90,191,620 171,159,647 313,386,570 9,144,010
LIABILITIES
Accounts payable and accrued
expenses 16,018 30,959 45,228 2,290
Securities purchased 676,545 750,267 1,038,644 0
Capital shares payable 3,015 2,500 23,000 0
Distributions payable 0 4,991 42,734 0
-------------- ------------- ------------- -------------
Total liabilities 695,578 788,717 1,149,606 2,290
-------------- ------------- ------------- -------------
Net assets $ 89,496,042 $ 170,370,930 $ 312,236,964 $ 9,141,720
============== ============= ============= =============
NET ASSETS
Retail shares
Net assets 89,351,011 170,235,519 309,496,263 8,784,041
Number of shares outstanding 4,958,227 12,444,694 36,431,317 1,079,387
Net asset value $ 18.02 $ 13.68 $ 8.50 $ 8.14
============== ============= ============= =============
Institutional shares
Net assets 145,031 135,411 2,740,701 357,679
Number of shares outstanding 8,051 9,925 322,478 43,674
Net asset value $ 18.01 $ 13.64 $ 8.50 $ 8.19
============== ============= ============= =============
Net assets consist of
Paid-in capital 111,595,044 225,492,235 377,567,147 11,877,484
Accumulated undistributed net
investment income (loss) (46,245) 0 0 32,286
Accumulated net realized
loss on investments (21,154,691) (58,814,255) (61,280,012) (2,224,942)
Net unrealized appreciation
(depreciation)
in value of investments (898,066) 3,692,950 (4,050,171) (543,108)
-------------- ------------- ------------- -------------
Net assets $ 89,496,042 $ 170,370,930 $ 312,236,964 $ 9,141,720
============== ============= ============= =============
See Notes to Financial Statement
-31-
ADVANCE CAPITAL I, INC.
STATEMENTS OF OPERATIONS (Unaudited)
SIX MONTHS ENDED JUNE 30, 2010
EQUITY BALANCED RETIREMENT CORE EQUITY
GROWTH FUND FUND INCOME FUND FUND
--------------- ------------- ------------- --------------
INVESTMENT INCOME
Interest $ 3,007 $ 1,838,502 $ 9,629,159 $ 199
Interest from adviser 58,586 61,595 2,035 0
Dividends 418,640 1,165,939 127,130 95,376
--------------- ------------- ------------- --------------
Total investment income 480,233 3,066,036 9,758,324 95,575
EXPENSES
Investment advisory fees 343,510 641,699 783,388 39,685
Distribution fees - Retail Class 122,495 229,002 388,826 11,922
Transfer agent and shareholder
reporting costs 31,745 55,209 93,215 9,072
Custodian fees 8,048 11,887 11,036 3,971
Directors fees and expenses 6,665 12,535 21,244 658
Professional fees 8,570 16,499 28,667 865
Registration and filing fees 3,937 4,448 5,114 3,066
Other operating expenses 1,508 2,994 5,434 163
--------------- ------------- ------------- --------------
Total expenses 526,478 974,273 1,336,924 69,402
Less: Waiver from adviser 0 0 0 (6,113)
--------------- ------------- ------------- --------------
Net expenses 526,478 974,273 1,336,924 63,289
NET INVESTMENT INCOME (LOSS) (46,245) 2,091,763 8,421,400 32,286
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on
investments 4,134,361 2,094,475 3,663,244 (57,886)
Net change in unrealized gain
(loss) on investments (6,350,314) (6,534,945) 6,437,648 (514,920)
---------------- ------------- ------------- --------------
NET GAIN (LOSS) ON INVESTMENTS (2,215,953) (4,440,470) 10,100,892 (572,806)
---------------- ------------- ------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ (2,262,198) $ (2,348,707) $ 18,522,292 $ (540,520)
================ ============== ============== ===============
See Notes to Financial Statements
-32-
ADVANCE CAPITAL I, INC.
STATEMENTS OF CHANGES IN NET ASSETS
EQUITY GROWTH FUND BALANCED FUND
(Unaudited) (Unaudited)
Six months Year Six months Year
ended ended ended ended
June 30, December 31, June 30, December 31,
2010 2009 2010 2009
--------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss) $ (46,245) $ 100,974 $ 2,091,763 $ 5,593,839
Net realized gain (loss) on investments 4,134,361 (8,563,064) 2,094,475 (20,703,829)
Net change in unrealized gain (loss)
on investments (6,350,314) 39,707,704 (6,534,945) 51,619,116
--------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from operations (2,262,198) 31,245,614 (2,348,707) 36,509,126
Distributions to Shareholders:
Net investment income
Retail shares 0 (161,087) (2,089,983) (5,676,145)
Institutional shares 0 (230) (1,780) (4,080)
--------------------------------------------------------------------
Total distributions to shareholders 0 (161,317) (2,091,763) (5,680,225)
Share Transactions:
Retail shares
Net proceeds from sale of shares 2,018,081 6,211,196 5,245,573 11,827,699
Reinvestment of distributions 0 157,883 2,054,120 5,591,098
Cost of shares reacquired (9,369,043) (22,433,720) (21,752,237) (59,299,141)
--------------------------------------------------------------------
Net change (7,350,962) (16,064,641) (14,452,544) (41,880,344)
--------------------------------------------------------------------
Institutional shares
Net proceeds from sale of shares 7,900 31,090 0 0
Reinvestment of distributions 0 230 1 2
Cost of shares reacquired 0 (23,551) 0 0
--------------------------------------------------------------------
Net change 7,900 7,769 1 2
--------------------------------------------------------------------
Net decrease derived from share transactions (7,343,062) (16,056,872) (14,452,543) (41,880,342)
NET ASSETS
Beginning of year 99,101,302 84,073,877 189,263,943 200,315,384
--------------------------------------------------------------------
End of period $ 89,496,042 $ 99,101,302 $ 170,370,930 $ 189,263,943
=====================================================================
NUMBER OF SHARES
Retail shares
Sold 103,492 413,293 363,271 953,744
Shares issued from reinvestment of distributions 0 8,525 144,863 455,411
Reacquired (488,923) (1,604,811) (1,523,632) (4,909,138)
---------------------------------------------------------------------
Net change (385,431) (1,182,993) (1,015,498) (3,499,983)
---------------------------------------------------------------------
Institutional shares
Sold 411 1,937 0 0
Shares issued from reinvestment of distributions 0 12 0 0
Reacquired 0 (1,529) 0 0
---------------------------------------------------------------------
Net change 411 420 0 0
---------------------------------------------------------------------
Net decrease in shares outstanding (385,020) (1,182,573) (1,015,498) (3,499,983)
Outstanding:
Beginning of year 5,351,298 6,533,871 13,470,117 16,970,100
---------------------------------------------------------------------
End of period 4,966,278 5,351,298 12,454,619 13,470,117
=====================================================================
See Notes to Financial Statements
-33-
ADVANCE CAPITAL I, INC.
STATEMENTS OF CHANGES IN NET ASSETS
RETIREMENT INCOME FUND CORE EQUITY FUND
(Unaudited) (Unaudited)
Six months Year Six months Year
ended ended ended ended
June 30, December 31, June 30, December 31,
2010 2009 2010 2009
--------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $ 8,421,400 $ 19,072,140 $ 32,286 $ 58,974
Net realized gain (loss) on investments 3,663,244 (9,380,663) (57,886) (829,180)
Net change in unrealized gain (loss) on investments 6,437,648 41,919,561 (514,920) 3,354,602
--------------------------------------------------------------------
Net increase (decrease) in net
assets resulting from operations 18,522,292 51,611,038 (540,520) 2,584,396
Distributions to Shareholders:
Net investment income
Retail shares (8,357,237) (19,717,218) 0 (56,786)
Institutional shares (64,163) (103,973) 0 (2,188)
--------------------------------------------------------------------
Total distributions to shareholders (8,421,400) (19,821,191) 0 (58,974)
Share Transactions:
Retail shares
Net proceeds from sale of shares 8,254,342 24,166,159 594,104 923,983
Reinvestment of distributions 8,170,758 19,345,674 0 49,804
Cost of shares reacquired (36,311,162) (96,634,621) (1,058,480) (2,123,586)
--------------------------------------------------------------------
Net change (19,886,062) (53,122,788) (464,376) (1,149,799)
--------------------------------------------------------------------
Institutional shares
Net proceeds from sale of shares 1,112,000 0 0 300,000
Reinvestment of distributions 0 2,204 0 2,188
Cost of shares reacquired (102,898) (331,579) 0 0
--------------------------------------------------------------------
Net change 1,009,102 (329,375) 0 302,188
--------------------------------------------------------------------
Net decrease derived from share transactions (18,876,960) (53,452,163) (464,376) (847,611)
NET ASSETS
Beginning of year 321,013,032 342,675,348 10,146,616 8,468,805
--------------------------------------------------------------------
End of period $ 312,236,964 $ 321,013,032 $ 9,141,720 $ 10,146,616
====================================================================
Accumulated Undistributed
Net Investment Income $ 0 $ 0 $ 32,286 $ 0
====================================================================
NUMBER OF SHARES
Retail shares
Sold 986,611 3,128,915 66,988 128,387
Shares issued from reinvestment of distributions 972,958 2,470,138 0 5,777
Reacquired (4,341,718) (12,494,358) (120,278) (302,300)
--------------------------------------------------------------------
Net change (2,382,149) (6,895,305) (53,290) (168,136)
--------------------------------------------------------------------
Institutional shares
Sold 132,585 0 0 43,415
Shares issued from reinvestment of distributions 0 297 0 253
Reacquired (12,273) (45,066) 0 0
--------------------------------------------------------------------
Net change 120,312 (44,769) 0 43,668
--------------------------------------------------------------------
Net decrease in shares outstanding (2,261,837) (6,940,074) (53,290) (124,468)
Outstanding:
Beginning of year 39,015,632 45,955,706 1,176,351 1,300,819
--------------------------------------------------------------------
End of period 36,753,795 39,015,632 1,123,061 1,176,351
====================================================================
See Notes to Financial Statements
-34-
NOTES TO FINANCIAL STATEMENTS (Unaudited)
Note 1. ORGANIZATION OF THE COMPANY
Advance Capital I, Inc. (the "COMPANY") is a Maryland Corporation organized
on March 6, 1987 that commenced operations on August 5, 1987. The COMPANY is
registered under the Investment Company Act of 1940, as amended, as
an open-end, diversified management investment company (a mutual fund)
offering shares in the following portfolios: Equity Growth Fund, Balanced
Fund, Retirement Income Fund and the Core Equity Fund (collectively
the "Funds"). Advance Capital Management, Inc. ("MANAGEMENT" or "Adviser")
(a wholly owned subsidiary of Advance Capital Group, Inc.) is the COMPANY's
investment adviser.
The Funds offer Retail Class shares and Institutional Class shares, each of
which has equal rights and voting privileges with respect to the Fund in
general and exclusive voting rights on matters that affect that class alone.
The two share classes have different fees and expenses ("class-specific fees
and expenses"), primarily due to different arrangements for distribution.
Differences in class-specific fees and expenses will result in differences in
net investment income and, therefore, the payment of different per-share
dividends by each class.
Under the COMPANY's organizational documents, its officers and directors are
indemnified against certain liabilities arising out of the performance of
their duties to the Funds. In addition, in the normal course of business, the
Funds enter into contracts with their vendors and others that provide for
general indemnifications. The Funds' maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the
Funds. However, based on experience, the Funds expect that risk of loss to be
remote.
Note 2. ACCOUNTING POLICIES
The preparation of financial statements in accordance 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 and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of increases
and decreases in net assets from operations during the reporting period.
Actual results could differ from these estimates.
The following is a summary of significant accounting policies followed
by the COMPANY.
SECURITY VALUATION
Equity securities for which exchange quotations are readily available are
valued at the last quoted market price at the time the valuations are made
and debt securities are valued using prices furnished by an independent third
party pricing service. The independent third party pricing service may use a
matrix, formula or other objective method that considers the effect of market
indices, yield curves and other specific adjustments to determine market
price. When reliable market quotations are not readily available or are
considered unreliable, securities are priced at their fair value, determined
according to procedures adopted by the Board of Directors, which may include
using an independent pricing service. Fair value procedures may also be used
if the COMPANY determines that a significant event has occurred between the
time at which a market price is determined but prior to the time at which a
fund's net asset value is calculated. Money market instruments or short-term
debt held by the Funds with a remaining maturity of sixty days or less are
valued at amortized cost which approximates value.
FAIR VALUE MEASUREMENT
As described above, the Funds utilize various methods to measure the fair
value of their investments on a recurring basis. Generally accepted
accounting principles ("GAAP") establish a hierarchy that prioritizes
inputs to valuation methods.
-35-
Note 2. ACCOUNTING POLICIES (Continued)
The three levels of the fair value hierarchy are described below:
Level 1 - quoted prices in active markets for identical securities
Level 2 - other significant observable inputs (including quoted
prices for similar securities, interest rates, prepayment
speeds, credit risk, etc.)
Level 3 - significant unobservable inputs (including the Funds' 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.
The following is a summary of the inputs used to value each Fund's
investments as of June 30, 2010:
Equity Balanced Retirement Core
Valuation Inputs Growth Fund Fund Income Fund Equity Fund
- ------------------------------------------------------------------------------------------------------
Level 1 - Quoted Prices:
Common Stock* $ 87,268,369 $ 103,670,682 $ 12,121,201 $ 8,840,923
Short-Term Investments 653,643 949,257 79,374 274,141
Level 2 - Other Significant
Observable Inputs:
Fixed Income Securities* 0 61,816,250 295,783,579 0
Level 3 - Significant
Unobservable Inputs:
Fixed Income Securities* 0 0 0 0
- ------------------------------------------------------------------------------------------------------
Total Market Value
of Investments $ 87,922,012 $ 166,436,189 $ 307,984,154 $ 9,115,064
- ------------------------------------------------------------------------------------------------------
* Please refer to the Schedule of Investments to view common stock and
fixed income securities segregated by industry type.
The following is a reconciliation of the Level 3 investments in fixed
income securities for the period ended June 30, 2010:
Equity Balanced Retirement Core
Valuation Inputs Growth Fund Fund Income Fund Equity Fund
- ------------------------------------------------------------------------------------------------------
Balance as of 12/31/09 $0 $0 $530,000 $0
Accrued discounts/premiums 0 0 0 0
Realized gain/loss 0 0 0 0
Change in unrealized appreciation (depreciation) 0 0 1,170,000 0
Net purchases (sales) 0 0 0 0
Transfers in to (out of) level 3 to level 2** 0 0 (1,700,000) 0
- ------------------------------------------------------------------------------------------------------
Balance as of 6/30/10 $0 $0 $0 $0
- ------------------------------------------------------------------------------------------------------
** Transfers made during the period ending June 30, 2010 resulted from inputs
with a higher priority in the fair value hierarchy becoming available.
-36-
Note 2. ACCOUNTING POLICIES (Continued)
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES
Income, fees and expenses of the COMPANY (other than class-specific fees and
expenses) and realized and unrealized gains and losses are allocated on a
daily basis to each class of shares or Fund based upon their relative net
assets. Class-specific fees and expenses are charged directly to the
respective share class. Fund-specific fees and expenses are charged
directly to the respective Fund.
FEDERAL INCOME TAXES
It is each Fund's policy to meet the requirements to qualify each year as a
registered investment company under Subchapter M of the Internal Revenue
Code. Each Fund intends to distribute all of its taxable income to its
shareholders. Therefore, no federal income tax provision is provided. Capital
losses are available to offset future capital gains, if any.
As of and during the period June 30, 2010, there is no tax liability resulting
from unrecognized tax benefits related to uncertain tax positions taken or
expected to be taken in future tax returns. The Funds are also not aware of
any tax positions for which it is reasonably possible that the total amounts
of unrecognized tax benefits will significantly change in the next twelve
months. Differences between tax positions taken in a tax return and amounts
recognized in the financial statements will generally result in an increase
in a liability for taxes payable (or a reduction of a tax refund receivable),
including the recognition of any related interest and penalties as an
operating expense. During the period, the Funds did not incur any interest or
penalties. The Funds are not subject to examination by U.S. federal tax
authorities for tax years before 2006.
DIVIDENDS
Income dividends in the Balanced Fund and Retirement Income Fund are declared
daily, except on Saturdays, Sundays and holidays and are paid monthly on the
last business day of the month. Income dividends in the Equity Growth Fund
and Core Equity Fund, if any, are declared annually and paid on the last
business day of the year. Capital gain distributions, if any, are declared
annually and paid in December. Dividends to shareholders are recorded on
the ex-dividend date.
The amount of distributions from net investment income and net realized gains
are determined in accordance with federal income tax regulations which may
differ from generally accepted accounting principles. These "book/tax"
differences are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts are
reclassified within the composition of net assets based on their federal
tax-basis treatment; temporary differences do not require a reclassification.
OTHER
Security transactions are accounted for on the trade date, the date the order
to buy or sell is executed. Interest income is recorded on the accrual basis.
Dividend income is recorded on the ex-dividend date. Premium and discount on
fixed income securities are amortized using the effective interest method.
Realized gains and losses on security transactions are determined on the
specific identification method for book and tax purposes. Paydown gains and
losses on mortgage-backed and asset-backed securities are recorded as
adjustments to interest income in the Statement of Operations. Net investment
losses, for which no carryover is permitted, are offset against paid in
capital. MANAGEMENT has evaluated subsequent events through the date the
financial statements were issued.
Note 3. TRANSACTIONS WITH AFFILIATES
T. Rowe Price Associates, Inc. ("TRPA") serves as sub-adviser for that
portion of the portfolio of assets of the Equity Growth Fund and Balanced Fund
which are determined by MANAGEMENT to be invested in common stocks. Seizert
Capital Partners, LLC ("Seizert") serves as sub-adviser for the Core Equity
Fund. Advance Capital Services, Inc. ("SERVICES") (also a wholly owned
subsidiary of Advance Capital Group, Inc.) is the distributor of the COMPANY's
shares. Advance Capital Group, Inc. ("GROUP") is the COMPANY's Administrator,
Transfer Agent and Dividend Disbursing Agent. For services provided by
MANAGEMENT, the COMPANY pays a fee on an annual basis equal to .70% of the
average daily net assets for the first $500 million and .65% of the average
daily
-37-
net assets exceeding $500 million of the Equity Growth and Balanced Funds and
..50% of the average daily net assets for the first $500 million and .45% of
the average daily net assets exceeding $500 million of the Retirement Income
Fund and .80% of the average daily net assets of the Core Equity Fund. For its
services, TRPA is paid a fee by MANAGEMENT on an annual basis equal to .20% of
the average daily net assets of the Equity Growth Fund and that portion of the
Balanced Fund invested in common stocks for the first $100 million of assets
managed and .15% of the average daily net assets exceeding $100 million. For
its services, Seizert is paid a fee by MANAGEMENT on an annual basis equal to
..40% of the average daily net assets of the Core Equity Fund. GROUP provides
administrative, transfer agent and dividend disbursing agent services to the
COMPANY. The COMPANY will compensate SERVICES for expenses incurred in
connection with the distribution of Retail Class shares of the Equity Growth,
Balanced, Retirement Income and Core Equity, at .25% of each fund's average
daily net assets.
The COMPANY was charged investment advisory fees of $1,808,282 by MANAGEMENT
for the six months ended June 30, 2010. The COMPANY was charged distribution
fees of $752,245 by SERVICES for Retail Class shares for the six months ended
June 30, 2010.
Certain officers and directors of GROUP, MANAGEMENT, and SERVICES, are also
officers and directors of the COMPANY. Director's fees are only paid to
independent directors and consist of a $16,400 annual retainer. The Chairman
of the Board receives an additional 50% in compensation.
Note 4. NOTE RECEIVABLE FROM ADVISER
During October 2008, the COMPANY determined it had incorrectly valued the
securities purchased with the cash collateral received from the securities
lending program resulting in an overstatement of net assets. Reimbursements
to the funds impacted by this error are represented as receivables from the
Adviser. The receivables were established as unsecured promissory notes. The
terms of the notes include payment over 7 years at an interest rate of 3.5%
above the prime rate, reset from time to time as the prime rate changes,
with interest and principal payable over 84 monthly installments. The
effective date of the notes is January 1, 2009. The notes may be repaid in
full or in part at any time without penalty.
Note 5. INVESTMENT PORTFOLIO TRANSACTIONS
The cost of purchases and proceeds from sales of investments, other than
short-term obligations and U.S. Government securities, for the six months
ended June 30, 2010 were as follows:
Equity Balanced Retirement Core
Growth Fund Fund Income Fund Equity Fund
--------------------------------------------------------
Purchases $11,999,640 $32,859,630 $105,875,822 $1,810,299
Sales 19,414,672 46,764,425 121,692,642 2,031,753
At June 30, 2010, the gross unrealized net appreciation and depreciation
of securities for financial reporting purposes consisted of the following:
Equity Balanced Retirement Core
Growth Fund Fund Income Fund Equity Fund
------------------------------------------------------
Unrealized Appreciation $14,725,135 $16,044,964 $15,268,020 $556,513
Unrealized Depreciation (15,623,201) (12,352,014) (19,318,191) (1,099,621)
------------------------------------------------------
Net Unrealized
Appreciation/
(Depreciation)* ($898,066) $3,692,950 ($4,050,171) ($543,108)
*The differences between book basis and tax basis unrealized appreciation is
attributable primarily to tax deferral of losses on wash sales.
-38-
Note 6. AUTHORIZED SHARES
The COMPANY has one billion authorized shares of common stock, par value of
$.001 per share. Each of the COMPANY's three portfolios has 150 million
shares authorized for Retail Class shares and 100 million shares authorized
for Institutional Class shares.
Note 7. FEDERAL INCOME TAX INFORMATION
The tax characteristics of distributions paid to shareholders during the
period ended June 30, 2010 and the year ended December 31, 2009 were
as follows:
Distributions Total
Six months ended Paid From Long Term Return Of Distributions
June 30, 2010 Ordinary Income Capital Gain Capital Paid
- --------------------------------------------------------------------------------------------
Equity Growth Fund $0 $0 $0 $0
Balanced Fund 2,091,763 0 0 2,091,763
Retirement Income Fund 8,421,400 0 0 8,421,400
Core Equity Fund 0 0 0 0
Distributions Total
Year Ended Paid From Long Term Return Of Distributions
December 31, 2009 Ordinary Income Capital Gain Capital Paid
- --------------------------------------------------------------------------------------------
Equity Growth Fund $161,317 $0 $0 $161,317
Balanced Fund 5,680,225 0 0 5,680,225
Retirement Income Fund 19,821,191 0 0 19,821,191
Core Equity Fund 58,974 0 0 58,974
Note 8. NEW ACCOUNTING PRONOUNCEMENTS
In January 2010, the Financial Accounting Standards Board issued an Accounting
Standards Update that will require reporting entities to make new disclosures
about information on purchases, sales, issuances, and settlements in the roll
forward of activity in level 3 fair value measurements. The new and revised
disclosures are effective for interim and annual periods beginning after
December 15, 2010. At this time, MANAGEMENT is evaluating the implications
of this change and its impact on the financial statements has not been
determined.
-39-
ADDITIONAL INFORMATION (UNAUDITED)
RESULTS OF ANNUAL SHAREHOLDER VOTE
An Annual Meeting of Shareholders of the COMPANY was held at the Sheraton
Detroit Novi, 21111 Haggerty Road, Novi, Michigan, on August 6, 2010,
for the following purposes:
1. To elect five Directors to hold office until the next Annual Meeting of
Shareholders or until their successors have been elected and qualified.
Directors Elected at Meeting Votes For
- ---------------------------- ---------
Joseph A. Ahern 29,375,674
Susan Burns 29,309,978
Robert J. Cappelli 29,443,670
Janice Loichle 29,295,515
Thomas L. Saeli 29,335,943
2. To ratify the selection of Cohen Fund Audit Services, Ltd. as independent
registered public accountants of the COMPANY for the fiscal year ending
December 31, 2010.
Votes For: 29,124,208
Votes Against: 76,885
Votes to Abstain: 642,557
MANAGEMENT OF THE FUND
Advance Capital I, Inc. is managed by a Board of Directors. The Directors are
responsible for managing the company's business affairs and for exercising all
the company's powers except those reserved for the shareholders. Officers and
Directors of the COMPANY, their addresses, and principal occupations during
the last five years, are as follows:
- -----------------------------------------------------------------------------------------------------------------------------
Number of Other
Position(s) & Year Principal Occupations Portfolios Directorships
Name and Address Office(s) Elected* During Past 5 Years Overseen Held **
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
"INTERESTED" DIRECTORS***
- -----------------------------------------------------------------------------------------------------------------------------
Robert J. Cappelli Director and 2004 President and Treasurer, Advance 4 None
One Towne Square President Capital I, Inc. and Advance
Suite 444 Capital Group, Inc.; Vice President
Southfield, MI 48076 Treasurer 1987 & Treasurer, Advance Capital
Age 58 Services, Inc. and Advance Capital
Management, Inc.
- -----------------------------------------------------------------------------------------------------------------------------
"NOT-INTERESTED" DIRECTORS
- -----------------------------------------------------------------------------------------------------------------------------
Joseph A. Ahern Director 1995 Attorney; President and 4 None
One Towne Square Shareholder; Ahern Fluery since
Suite 444 Independent 2005 March 2009; President and
Southfield, MI 48076 Chairman Shareholder; Stark, Reagan, P.C.,
Age 52 from prior to 2005 until March
2009 (law firms)
- -----------------------------------------------------------------------------------------------------------------------------
Susan E. Burns Director 2008 President, St. John Health 4 None
One Towne Square Foundation since July 2008;
Suite 444 President, Wayne State University
Southfield, MI 48076 Foundation and Vice President,
Age 48 Development and Alumni Affairs
from prior to 2005 until July 2008
- -----------------------------------------------------------------------------------------------------------------------------
-40-
MANAGEMENT OF THE FUND (Continued)
- -----------------------------------------------------------------------------------------------------------------------------
Number of Other
Position(s) & Year Principal Occupations Portfolios Directorships
Name and Address Office(s) Elected* During Past 5 Years Overseen Held**
- -----------------------------------------------------------------------------------------------------------------------------
Janice E. Loichle Director 2001 Retired; Former Vice President, 4 None
One Towne Square Chief Integration Officer and Chief
Suite 444 of Local Exchange Operations, XO
Southfield, MI 48076 Communications, Inc. (formerly
Age 62 NEXTLINK Communications);
President, NEXTLINK Solutions
(telecommunications)
- -----------------------------------------------------------------------------------------------------------------------------
Thomas L. Saeli Director 2000 Chief Executive Officer, Noble 4 Noble
One Towne Square International, Ltd., March 2006 International,
Suite 444 to April 2009; Vice President- Ltd. (2006 to
Southfield, MI 48076 Corporate Development, Lear 2009); Ultralife
Age 53 Corporation, from prior to 2005 Corporation (2010
until March 2006 (automotive to date)
suppliers)
- -----------------------------------------------------------------------------------------------------------------------------
OTHER OFFICERS
- -----------------------------------------------------------------------------------------------------------------------------
Christopher M. Kostiz Vice President 2003 Vice President, Advance Capital 4 None
One Towne Square I, Inc.; President and Senior
Suite 444 Portfolio Manager, Advance Capital
Southfield, MI 48076 Management, Inc.
Age 42
- -----------------------------------------------------------------------------------------------------------------------------
Kathy J. Harkleroad Vice President, 1996 Vice President, Chief Compliance 4 None
One Towne Square Chief Compliance Officer and Secretary, Advance
Suite 444 Officer and Capital I, Inc. and Advance Capital
Southfield, MI 48076 Secretary Group, Inc.; Marketing Director,
Age 57 Advance Capital Services, Inc.
- -----------------------------------------------------------------------------------------------------------------------------
Julie A. Katynski Vice President 2003 Vice President and Assistant 4 None
One Towne Square and Assistant Secretary, Advance Capital I, Inc.
Suite 444 Secretary and Advance Capital Group, Inc.;
Southfield, MI 48076 Controller, Advance Capital Group,
Age 44 Inc.
- -----------------------------------------------------------------------------------------------------------------------------
*There is no set term of office for Directors and Officers. The Independent
Directors have adopted a retirement policy, which calls for the retirement
of Directors in the year in which they reach the age of 70.
**This column includes only directorships of companies required to register
or file reports with the Commission under the Securities Exchange Act of
1934 (that is, "public companies") or other investment companies registered
under the 1940 Act.
***Officers of the Funds are "interested persons" as defined in the Investment
Company Act of 1940.
-41-
EXPENSE EXAMPLES:
As a shareholder of the Funds, you incur ongoing costs, including management
fees; distribution (and/or service)12b-1 fees; and other Fund expenses. This
example is intended to help you understand your ongoing costs (in dollars)
of investing in the Funds 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 from January 1, 2010 through
June 30, 2010.
ACTUAL EXPENSES
The table below provides information about actual account values and actual
expenses. You may use the information below, 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
table under the heading entitled "Expenses Paid During Period" to
estimate the expenses you paid on your account during the period.
Beginning Ending Expense Paid Expense Ratio
Account Value Account Value During Period* During Period
1/1/10 6/30/10 1/1/10 - 6/30/10 1/1/10 - 6/30/10
- -------------------------------------------------------------------------------------------
Equity Growth Fund
Retail shares $1,000.00 $973.00 $5.23 1.07%
Institutional shares 1,000.00 974.00 4.01 0.82%
- -------------------------------------------------------------------------------------------
Balanced Fund
Retail shares $1,000.00 $984.80 $5.22 1.06%
Institutional shares 1,000.00 986.00 3.99 0.81%
- -------------------------------------------------------------------------------------------
Retirement Income Fund
Retail shares $1,000.00 $1,060.50 $4.34 0.85%
Institutional shares 1,000.00 1,061.80 3.07 0.60%
- -------------------------------------------------------------------------------------------
Core Equity Fund
Retail shares $1,000.00 $944.30 $6.17 1.28%
Institutional shares 1,000.00 944.60 4.97 1.03%
*Expenses are equal to the average account value times each Fund's
annualized expense ratio multiplied by the number of days in the
most recent fiscal half-year divided by the number of days in the
fiscal year.
-42-
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The table below provides information about the hypothetical values and
hypothetical expenses based on each Funds' actual expense ratio and an
assumed rate of return of 5% per year before expenses, which is not the
Fund's actual return. The hypothetical account values and expenses may
not be used to estimate the actual ending account balance or expenses
you paid for the period. You may use this information to compare this
5% hypothetical example with the 5% hypothetical examples that appear
in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight
your ongoing costs only. Therefore, the table is useful in comparing
ongoing costs only, and will not help you determine the relative total
costs of owning different funds.
Beginning Ending Expense Paid Expense Ratio
Account Value Account Value During Period* During Period
1/1/10 6/30/10 1/1/10 - 6/30/10 1/1/10 - 6/30/10
- -------------------------------------------------------------------------------------------
Equity Growth Fund
Retail shares $1,000.00 $1,019.49 $5.36 1.07%
Institutional shares 1,000.00 1,020.73 4.11 0.82%
- -------------------------------------------------------------------------------------------
Balanced Fund
Retail shares $1,000.00 $1,019.54 $5.31 1.06%
Institutional shares 1,000.00 1,020.78 4.06 0.81%
- -------------------------------------------------------------------------------------------
Retirement Income Fund
Retail shares $1,000.00 $1,020.58 $4.26 0.85%
Institutional shares 1,000.00 1,021.82 3.01 0.60%
- -------------------------------------------------------------------------------------------
Core Equity Fund
Retail shares $1,000.00 $1,018.45 $6.41 1.28%
Institutional shares 1,000.00 1,019.69 5.16 1.03%
*Expenses are equal to the average account value times each Fund's annualized
expense ratio multiplied by the number of days in the most recent fiscal
half-year divided by the number of days in the fiscal year.
PROXY VOTING
The policies and procedures that Advance Capital I, Inc. uses to determine how
to vote proxies relating to portfolio securities is available on the SEC's
website at www.sec.gov. Information on how the Funds voted proxies relating to
portfolio securities during the 12 month period ended June 30, 2010 is
available at (1) without charge, upon request, by calling (800) 345-4783, and
(2) on the SEC's website at www.sec.gov.
QUARTERLY PORTFOLIO SCHEDULE
The Funds file with the SEC a complete schedule of its portfolio holdings as
of the close of the first and third quarters of its fiscal year, on
"Form N-Q". These filings are available on the SEC's website at www.sec.gov
and may be reviewed and copied at the SEC's Public Reference Room in
Washington, D.C. (Call 1-800-SEC-0330 for information on the operation of
the Public Reference Room.) This information is also available without
charge ,upon request, by calling (800) 345-4783.
-43-
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Advance Capital I, Inc.
Investment Advisor: Semi-Annual Report
Advance Capital Management, Inc. June 30, 2010
One Towne Square, Suite 444
Southfield, Michigan 48076
Sub-Advisors:
(Equity Growth and Balanced Funds)
T. Rowe Price Associates, Inc.
100 East Pratt Street
Baltimore, Maryland 21202
(Core Equity Fund)
Seizert Capital Partners, LLC
185 West Oakland
Birmingham, MI 48009
Distributor:
Advance Capital Services, Inc.
P.O. Box 3144
Southfield, Michigan 48037
Administrator and Transfer Agent: AN INVESTMENT COMPANY
Advance Capital Group, Inc. WITH FOUR FUNDS
P.O. Box 3144
Southfield, Michigan 48037 Equity Growth Fund
Balanced Fund
Custodian: Retirement Income Fund
Fifth Third Bank Core Equity Fund
38 Fountain Square Plaza
Cincinnati, Ohio 45263
Officers:
Robert J. Cappelli, President & Treasurer
Christopher M. Kostiz, Vice President
Kathy J. Harkleroad, Vice President,
Chief Compliance Officer & Secretary
Julie A. Katynski, Vice President & Assistant Secretary
Board of Directors:
Joseph A. Ahern
Susan E. Burns
Robert J. Cappelli
Janice E. Loichle
Thomas L. Saeli
Item 2. Code of Ethics.
Not applicable for the semi-annual report.
Item 3. Audit Committee Financial Expert.
Not applicable for the semi-annual report.
Item 4. Principal Accountant Fees and Services.
Not applicable for the semi-annual report.
Item 5. Audit Committee of Listed Registrant.
Not applicable because registrant's shares are not listed for
trading on a national securities exchange.
Item 6. Schedule of Investments.
Schedule I - Investments in securities of unaffiliated issuers
is included as part of the report to shareholders filed under
Item 1 of this Form.
Item 7. Disclosure of Proxy Voting Policies and Procedures for
Closed-end Management Investment Companies.
Not applicable for open-end investment companies.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable for open-end investment companies.
Item 9. Purchases of Equity Securities by Closed-End Management
Investment Company and Affiliated Purchasers.
Not applicable for open-end investment companies.
Item 10. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 11. Controls and Procedures.
(a) The Company maintains a system of disclosure controls and
procedures that are designed to provide reasonable assurance that
information required to be disclosed in its reports filed or submitted
under the Investment Company Act of 1940, as amended (the "1940 Act"),
is recorded, processed, summarized and reported within the time periods
specified in the SEC's rules and forms, and that such information is
accumulated and communicated to management to allow timely decisions
regarding required disclosures. The Company's principal executive officer
and principal financial officer, or persons performing similar functions,
have concluded that the registrant's disclosure controls and procedures
(as defined in Rule 30a-3(c) under the 1940 Act) are effective, based on
their evaluation of the disclosure controls and procedures as of
June 30, 2010, a date that is within 90 days of the filing date of this
report.
(b) There were no significant changes in the registrant's internal control
over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d))) that occurred during the registrant's second fiscal
quarter of the period covered by this report that has materially affected, or
is reasonably likely to materially affect, the registrant's internal control
over financial reporting.
Item 12. Exhibits.
(a)(1) Not applicable.
(a)(2) Certification pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
(a)(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
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.
ADVANCE CAPITAL I, INC.
By: /S/ Robert J. Cappelli
---------------------------------------------
Robert J. Cappelli, President & Treasurer
Date: August 24, 2010
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 on the
dates indicated.
By: /S/ Robert J. Cappelli
---------------------------------------------
Robert J. Cappelli, President & Treasurer
Date: August 24, 2010
By: /S/ Christopher M. Kostiz
--------------------------------------------
Christopher M. Kostiz, Vice President
Date: August 24, 2010