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 NUMBERS 811-6618 FIRST INVESTORS EQUITY FUNDS (Exact name of registrant as specified in charter) 95 Wall Street New York, NY 10005 (Address of principal executive offices) (Zip code) Joseph I. Benedek First Investors Management Company, Inc. Raritan Plaza I Edison, NJ 08837-3620 1-732-855-2712 (Name and address of agent for service) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-212-858-8000 DATE OF FISCAL YEAR END: SEPTEMBER 30, 2006 DATE OF REPORTING PERIOD: MARCH 31, 2006 Item 1. Reports to Stockholders 		The semi-annual report to stockholders follows. [First Investors Logo] EQUITY FUNDS TOTAL RETURN VALUE BLUE CHIP GROWTH & INCOME ALL-CAP GROWTH MID-CAP OPPORTUNITY SPECIAL SITUATIONS FOCUSED EQUITY GLOBAL SEMI-ANNUAL REPORT March 31, 2006 Equity Market Overview FIRST INVESTORS EQUITY FUNDS Dear Investor: With a robust domestic economy as a backdrop, the U.S. stock market performed well during the reporting period. Smaller stocks were the strongest performers, as the Russell 2000 (a leading benchmark for small-cap stocks), and the S&P 400 Mid-Cap Index posted returns of 14.6% and 10.6%, respectively. Larger-cap stocks also posted solid results, with the S&P 500 Index advancing 5.4% during the reporting period. The economy sputtered to a 1.7% growth rate in the fourth quarter of 2005 following Hurricane Katrina, but came roaring back in the first quarter of 2006 at 4.8%, the strongest growth in over two years. The unemployment rate fell to a cycle low of 4.7% in January, and personal income and consumption showed strong growth despite some regional evidence of a softening housing market. Investment by corporations picked up substantially in the first quarter of 2006. Inflation moved lower during the reporting period as oil prices moderated. Excluding food and energy, the rate of inflation was stable at 2.1% over the past twelve months. Nonetheless, the Federal Reserve ("the Fed") was concerned that continued economic strength and high energy prices were a potential threat to price stability. Consequently, the Fed raised the benchmark federal funds rate four times from 3.75% to 4.75%. The Fed has now raised rates fifteen times since June 2004. The stock market's performance followed divergent paths over the reporting period. Stocks were lackluster during the last three months of 2005, as most major market indexes struggled to post low single digit gains. High energy prices placed a tax on businesses and consumers and the steady rise of short-term interest rates decelerated corporate and consumer borrowing. However, stocks surged forward in the first quarter of 2006, posting their best first quarter since 1999. Most major market indexes had solid gains and small-cap stocks led the rally. The Russell 2000 jumped nearly 14% and ended the quarter at a record high. Large caps also performed well, as the S&P 500 increased nearly 4% for the quarter to pull within reach of its all-time high, hit six years ago in January 2000. Much of the market's momentum can be traced to investors' anticipation that the Fed was nearly finished with its rate tightening campaign. Stock valuation levels appear reasonable, as corporate earnings continue to outperform expectations. Solid fundamentals and a stable interest rate environment are a prescription for better markets. Equity Market Overview (continued) FIRST INVESTORS EQUITY FUNDS Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ EDWIN D. MISKA Edwin D. Miska Director of Equities First Investors Management Company, Inc. May 1, 2006 This Market Overview is not part of the Funds' financial report and is submitted for the general information of the shareholders of the Funds. It is not authorized for distribution to prospective investors in the Funds, unless preceded or accompanied by an effective prospectus. The Market Overview reflects conditions through the end of the period as stated on the cover. Market conditions are subject to change. This Market Overview may not be relied upon as investment advice or an indication of current or future trading intent on behalf of any Fund. There are a variety of risks associated with investing in mutual funds. For stock funds, the risks include market risk (the risk that the entire stock market will decline because of an event such as a deterioration in the economy or a rise in interest rates), as well as special risks associated with investing in certain types of stock funds, such as small-cap, global and international funds. For bond funds, the risks include interest rate risk and credit risk. Interest rate risk is the risk that bonds will decrease in value as interest rates rise. As a general matter, longer-term bonds fluctuate more than shorter-term bonds in reaction to changes in interest rates. Credit risk is the risk that bonds will decline in value as the result of a decline in the credit rating of the bonds or the economy as a whole, or that the issuer will be unable to pay interest and/or principal when due. You should consult your prospectus for a precise explanation of the risks associated with your fund. Understanding Your Fund's Expenses FIRST INVESTORS EQUITY FUNDS As a mutual fund shareholder, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (on Class A shares only), contingent deferred sales charges on redemptions (on Class B shares only); and (2) ongoing costs, including advisory fees; distribution and service fees (12b-1); and other expenses. These examples are 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 examples are based on an investment of $1,000 in each Fund at the beginning of the period, October 1, 2005, and held for the entire six-month period ended March 31, 2006. The calculations assume that no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions. Actual Expense Example: These amounts help you to estimate the actual expenses that you paid over the period. The "Ending Account Value" shown is derived from the Fund's actual return, and the "Expenses Paid During Period" shows the dollar amount that would have been paid by an investor who started with $1,000 in the Fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid during the period. To estimate the expenses you paid on your account during this period simply divide your ending account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60), then multiply the result by the number given for your Fund under the heading "Expenses Paid During Period". Hypothetical Expense Example: These amounts provide information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio for Class A and Class B shares, 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 the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight and help you compare your ongoing costs only and do not reflect any transactional costs, such as front-end or contingent deferred sales charges (loads). Therefore, the hypothetical expense example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. Fund Expenses TOTAL RETURN FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ---------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,056.14 $7.28 Hypothetical (5% annual return before expenses) $1,000.00 $1,017.85 $7.14 - ---------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,051.93 $10.85 Hypothetical (5% annual return before expenses) $1,000.00 $1,014.36 $10.65 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.42% for Class A shares and 2.12% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived. Portfolio Composition TOP TEN SECTORS (BAR CHART DATA:) Financials 15.3% Consumer Discretionary 13.5% Information Technology 12.9% Industrials 12.6% Health Care 8.8% Mortgage-Backed Certificates 5.7% Energy 5.5% Consumer Staples 5.5% U.S. Government Agency Obligations 5.1% Materials 4.2% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments TOTAL RETURN FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--66.5% Consumer Discretionary--11.9% 64,800 Blockbuster, Inc. - Class "A" $257,256 $7 46,650 CBS Corporation - Class "B" 1,118,667 33 22,700 Claire's Stores, Inc. 824,237 24 61,500 Clear Channel Communications, Inc. 1,784,115 52 75,700 * Cost Plus, Inc. 1,294,470 38 70,700 Dollar General Corporation 1,249,269 36 61,000 * Eddie Bauer Holdings, Inc. 786,900 23 15,500 Genuine Parts Company 679,365 20 108,700 H&R Block, Inc. 2,353,355 69 33,300 * Helen of Troy, Ltd. 705,960 21 42,900 Home Depot, Inc. 1,814,670 53 16,900 J.C. Penney Company, Inc. (Holding Co.) 1,020,929 30 23,400 Jones Apparel Group, Inc. 827,658 24 45,900 Kenneth Cole Productions, Inc. - Class "A" 1,271,430 37 83,600 Leggett & Platt, Inc. 2,037,332 59 65,800 * Lincoln Educational Services Corporation 1,115,310 32 65,600 McDonald's Corporation 2,254,016 66 57,200 * Morgans Hotel Group Company 1,010,152 29 53,800 Movado Group, Inc. 1,241,704 36 67,300 Newell Rubbermaid, Inc. 1,695,287 49 79,500 Orient-Express Hotels, Ltd. 3,118,785 91 25,900 Polo Ralph Lauren Corporation - Class "A" 1,569,799 46 116,600 * Prestige Brands Holdings, Inc. 1,419,022 41 102,400 * Quiksilver, Inc. 1,419,264 41 74,500 RadioShack Corporation 1,432,635 42 7,100 Ross Stores, Inc. 207,249 6 56,800 Russell Corporation 783,840 23 25,500 Sherwin-Williams Company 1,260,720 37 36,900 * Steiner Leisure, Ltd. 1,494,450 43 21,200 * Tommy Hilfiger Corporation 349,164 10 27,150 * Viacom, Inc. - Class "B" 1,053,420 31 141,300 Westwood One, Inc. 1,559,952 45 - ---------------------------------------------------------------------------------------------------------------------- 41,010,382 1,194 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--3.8% 41,900 Altria Group, Inc. 2,969,034 86 59,300 Avon Products, Inc. 1,848,381 54 15,300 Coca-Cola Company 640,611 18 14,800 Kimberly-Clark Corporation 855,440 25 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) TOTAL RETURN FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples (continued) 88,800 Nu Skin Enterprises, Inc. - Class "A" $1,556,664 $45 15,300 PepsiCo, Inc. 884,187 26 23,100 Procter & Gamble Company 1,331,022 39 28,155 Tootsie Roll Industries, Inc. 824,098 24 27,500 Wal-Mart Stores, Inc. 1,299,100 38 27,700 WD-40 Company 854,545 25 - ---------------------------------------------------------------------------------------------------------------------- 13,063,082 380 - ---------------------------------------------------------------------------------------------------------------------- Energy--5.5% 12,200 Anadarko Petroleum Corporation 1,232,322 36 30,700 Chesapeake Energy Corporation 964,287 28 27,700 ConocoPhillips 1,749,255 51 35,700 ExxonMobil Corporation 2,172,702 63 5,093 Marathon Oil Corporation 387,934 11 24,600 Noble Corporation 1,995,060 58 5,000 * PHI, Inc. - Non Voting Shares 183,600 6 35,000 Sasol, Ltd. (ADR) 1,324,050 39 46,500 Suncor Energy, Inc. 3,581,430 104 18,300 * Swift Energy Company 685,518 20 37,300 * Transocean, Inc. 2,995,190 87 36,866 XTO Energy, Inc. 1,606,252 47 - ---------------------------------------------------------------------------------------------------------------------- 18,877,600 550 - ---------------------------------------------------------------------------------------------------------------------- Financials--10.6% 15,400 American Express Company 809,270 24 27,600 American International Group, Inc. 1,824,084 53 3,080 Ameriprise Financial, Inc. 138,785 4 18,600 Astoria Financial Corporation 575,856 17 60,706 Bank of America Corporation 2,764,551 81 47,000 Brookline Bancorp, Inc. 728,030 21 46,400 Citigroup, Inc. 2,191,472 64 61,500 Colonial BancGroup, Inc. 1,537,500 45 18,500 Endurance Specialty Holdings, Ltd. 602,175 18 15,400 Fannie Mae 791,560 23 47,700 JPMorgan Chase & Company 1,986,228 58 11,500 Lehman Brothers Holdings, Inc. 1,662,095 48 32,600 Merrill Lynch & Company, Inc. 2,567,576 75 48,300 Montpelier Re Holdings, Ltd. 787,290 23 27,700 Morgan Stanley 1,740,114 51 27,700 National City Corporation 966,730 28 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 69,900 New York Community Bancorp, Inc. $1,224,648 $36 76,900 NewAlliance Bancshares, Inc. 1,109,667 32 78,332 North Fork Bancorporation, Inc. 2,258,312 66 23,000 Plum Creek Timber Company, Inc. (REIT) 849,390 25 36,900 South Financial Group, Inc. 964,935 28 61,500 Sovereign Bancorp, Inc. 1,347,465 39 46,100 U.S. Bancorp 1,406,050 41 36,345 U.S.B. Holding Company, Inc. 833,754 24 30,900 Wachovia Corporation 1,731,945 50 33,800 Washington Mutual, Inc. 1,440,556 42 21,500 Wells Fargo & Company 1,373,205 40 - ---------------------------------------------------------------------------------------------------------------------- 36,213,243 1,056 - ---------------------------------------------------------------------------------------------------------------------- Health Care--8.2% 49,400 Abbott Laboratories 2,098,018 61 27,800 Aetna, Inc. 1,366,092 40 14,400 * Amgen, Inc. 1,047,600 31 31,000 * Andrx Corporation 735,940 21 8,126 Baxter International, Inc. 315,370 9 30,500 * Boston Scientific Corporation 703,025 21 27,500 * Charles River Laboratories International, Inc. 1,348,050 39 6,200 * Genentech, Inc. 523,962 15 41,900 Johnson & Johnson 2,481,318 72 15,300 * Laboratory Corporation of America Holdings 894,744 26 16,700 Medicis Pharmaceutical Corporation - Class "A" 544,420 16 15,400 Medtronic, Inc. 781,550 23 24,700 Merck & Company, Inc. 870,181 25 15,500 * Momenta Pharmaceuticals, Inc. 304,730 9 124,080 Pfizer, Inc. 3,092,074 90 26,100 Sanofi-Aventis (ADR) 1,238,445 36 12,400 Stryker Corporation 549,816 16 67,600 * Thermo Electron Corporation 2,507,284 73 23,000 * Triad Hospitals, Inc. 963,700 28 17,050 UnitedHealth Group, Inc. 952,413 28 23,200 * Waters Corporation 1,001,080 29 24,500 * WellPoint, Inc. 1,897,035 55 43,300 Wyeth 2,100,916 61 - ---------------------------------------------------------------------------------------------------------------------- 28,317,763 824 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) TOTAL RETURN FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials--9.9% 35,300 3M Company $2,671,857 $78 15,500 Alexander & Baldwin, Inc. 739,040 21 31,300 American Standard Companies, Inc. 1,341,518 39 28,300 * BE Aerospace, Inc. 710,896 21 52,300 Briggs & Stratton Corporation 1,849,851 54 22,100 Burlington Northern Santa Fe Corporation 1,841,593 54 155,300 Cendant Corporation 2,694,455 78 11,100 Eaton Corporation 809,967 24 47,800 * Gardner Denver, Inc. 3,116,560 91 15,300 Harsco Corporation 1,264,086 37 59,500 Honeywell International, Inc. 2,544,815 74 14,100 Illinois Tool Works, Inc. 1,357,971 39 87,900 Knoll, Inc. 1,874,028 55 18,300 Lockheed Martin Corporation 1,374,879 40 76,500 * Navigant Consulting, Inc. 1,633,275 48 27,600 Northrop Grumman Corporation 1,884,804 55 22,700 * Pike Electric Corporation 476,927 14 61,300 * Pinnacle Airlines Corporation 408,258 12 18,500 Pitney Bowes, Inc. 794,205 23 27,300 * TAL International Group , Inc. 658,203 19 46,700 Tyco International, Ltd. 1,255,296 36 44,900 United Technologies Corporation 2,602,853 76 - ---------------------------------------------------------------------------------------------------------------------- 33,905,337 988 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--12.6% 33,900 Amphenol Corporation - Class "A" 1,768,902 52 74,600 * Cisco Systems, Inc. 1,616,582 47 50,800 * Electronics for Imaging, Inc. 1,420,876 41 107,600 * EMC Corporation 1,466,588 43 85,700 * Entrust, Inc. 385,650 11 37,076 First Data Corporation 1,735,898 51 72,300 Hewlett-Packard Company 2,378,670 69 53,800 Intel Corporation 1,041,030 30 33,800 International Business Machines Corporation 2,787,486 81 15,500 * International Rectifier Corporation 642,165 19 18,000 * Lam Research Corporation 774,000 23 107,600 Microsoft Corporation 2,927,796 85 82,700 Motorola, Inc. 1,894,657 55 30,700 * NCI, Inc. - Class "A" 429,800 13 116,500 Nokia Corporation - Class "A" (ADR) 2,413,880 70 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 50,200 * OmniVision Technologies, Inc. $1,516,040 $44 56,300 * Openwave Systems, Inc. 1,214,954 35 34,200 * Palm, Inc. 792,072 23 83,000 * Paxar Corporation 1,624,310 47 39,100 * Polycom, Inc. 847,688 25 41,500 QUALCOMM, Inc. 2,100,315 61 9,400 * SanDisk Corporation 540,688 16 66,200 * Silicon Image, Inc. 682,522 20 131,700 * Smart Modular Technologies (WWH), Inc. 1,191,885 35 19,800 StarTek, Inc. 466,488 14 102,300 * Symantec Corporation 1,721,709 50 59,834 Taiwan Semiconductor Manufacturing Co., Ltd. (ADR) 601,930 18 29,200 * Tech Data Corporation 1,077,772 31 108,500 * TIBCO Software, Inc. 907,060 26 28,000 * Varian Semiconductor Equipment Associates, Inc. 786,240 23 91,300 * VeriSign, Inc. 2,190,287 64 55,000 Xilinx, Inc. 1,400,300 41 - ---------------------------------------------------------------------------------------------------------------------- 43,346,240 1,263 - ---------------------------------------------------------------------------------------------------------------------- Materials--2.8% 21,400 Ashland, Inc. 1,521,112 44 24,500 Dow Chemical Company 994,700 29 18,900 Freeport-McMoRan Copper & Gold, Inc. - Class "B" 1,129,653 33 37,500 Lubrizol Corporation 1,606,875 47 13,800 PPG Industries, Inc. 874,230 26 18,500 Praxair, Inc. 1,020,275 30 61,500 RPM International, Inc. 1,103,310 32 28,000 Temple-Inland, Inc. 1,247,400 36 - ---------------------------------------------------------------------------------------------------------------------- 9,497,555 277 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--.6% 50,600 AT&T, Inc. 1,368,224 40 23,000 Verizon Communications, Inc. 783,380 23 - ---------------------------------------------------------------------------------------------------------------------- 2,151,604 63 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) TOTAL RETURN FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Utilities--.6% 35,300 Atmos Energy Corporation $929,449 $27 23,000 Consolidated Edison, Inc. 1,000,500 29 - ---------------------------------------------------------------------------------------------------------------------- 1,929,949 56 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $181.249,201) 228,312,755 6,651 - ---------------------------------------------------------------------------------------------------------------------- CORPORATE BONDS--14.4% Aerospace/Defense--.1% $500M Precision Castparts Corp., 5.6%, 2013 492,663 14 - ---------------------------------------------------------------------------------------------------------------------- Automotive--.1% 350M DaimlerChrysler NA Holdings Corp., 6.5%, 2013 356,504 10 - ---------------------------------------------------------------------------------------------------------------------- Chemicals--.2% 698M Rohm & Haas Co., 7.4%, 2009 736,987 21 - ---------------------------------------------------------------------------------------------------------------------- Consumer Non-Durables--.3% 900M Clorox Co., 6.125%, 2011 920,975 27 - ---------------------------------------------------------------------------------------------------------------------- Financial--1.3% CIT Group, Inc.: 750M 7.75%, 2012 827,681 24 750M 5%, 2015 709,796 21 Ford Motor Credit Co.: 500M 6.5%, 2007 498,182 15 500M 7.75%, 2007 492,480 14 250M 6.625%, 2008 236,740 7 1,000M HSBC Finance Corp., 5%, 2015 945,551 28 885M SLM Corp., 5%, 2015 838,801 24 - ---------------------------------------------------------------------------------------------------------------------- 4,549,231 133 - ---------------------------------------------------------------------------------------------------------------------- Financial Services--1.8% 1,000M Lincoln National Corp., 6.5%, 2008 1,022,102 30 765M Marshall & Ilsley Bank, 5.2%, 2017 722,444 21 500M Merrill Lynch & Co., 4.79%, 2010 486,630 14 853M National City Bank of Kentucky, 6.3%, 2011 884,582 26 1,000M Nationsbank Corp., 7.8%, 2016 1,161,849 34 1,000M State Street Bank & Trust, 5.3%, 2016 978,170 28 737M Washington Mutual, Inc., 8.25%, 2010 802,797 23 - ---------------------------------------------------------------------------------------------------------------------- 6,058,574 176 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Food/Beverage/Tobacco--.6% Bottling Group, LLC: $950M 4.625%, 2012 $906,354 $26 200M 5%, 2013 194,215 6 1,000M Campbell Soup Co., 4.875%, 2013 957,319 28 - ---------------------------------------------------------------------------------------------------------------------- 2,057,888 60 - ---------------------------------------------------------------------------------------------------------------------- Food/Drug--.8% 600M Delhaize America, Inc., 8.125%, 2011 650,723 19 1,000M Kroger Co., 7.8%, 2007 1,030,088 30 996M Safeway, Inc., 7%, 2007 1,016,931 30 - ---------------------------------------------------------------------------------------------------------------------- 2,697,742 79 - ---------------------------------------------------------------------------------------------------------------------- Forest Products/Containers--.6% 1,100M International Paper Co., 6.75%, 2011 1,143,731 34 700M Weyerhaeuser Co., 6.75%, 2012 729,600 21 - ---------------------------------------------------------------------------------------------------------------------- 1,873,331 55 - ---------------------------------------------------------------------------------------------------------------------- Gaming/Leisure--.2% 750M MGM Mirage, Inc., 8.5%, 2010 806,250 23 - ---------------------------------------------------------------------------------------------------------------------- Health Care--.5% 1,000M HCA, Inc., 5.25%, 2008 987,808 29 800M Wyeth, 6.95%, 2011 849,058 25 - ---------------------------------------------------------------------------------------------------------------------- 1,836,866 54 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--.3% 900M International Business Machines Corp., 7.5%, 2013 1,012,316 30 - ---------------------------------------------------------------------------------------------------------------------- Manufacturing--1.0% 1,000M Dover Corp., 4.875%, 2015 950,197 28 1,000M Ingersoll-Rand Co., 4.75%, 2015 940,265 27 700M Newell Rubbermaid, Inc., 6.75%, 2012 727,855 21 900M United Technologies Corp., 7.125%, 2010 961,988 28 - ---------------------------------------------------------------------------------------------------------------------- 3,580,305 104 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) TOTAL RETURN FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Media-Broadcasting--.5% $750M Comcast Cable Communications, Inc., 7.125%, 2013 $795,167 $23 800M Cox Communications, Inc., 5.5%, 2015 757,256 22 - ---------------------------------------------------------------------------------------------------------------------- 1,552,423 45 - ---------------------------------------------------------------------------------------------------------------------- Media-Diversified--.6% 750M AOL Time Warner, Inc., 6.75%, 2011 778,656 23 500M Time Warner, Inc., 6.875%, 2018 519,532 15 705M Viacom, Inc., 8.625%, 2012 797,833 23 - ---------------------------------------------------------------------------------------------------------------------- 2,096,021 61 - ---------------------------------------------------------------------------------------------------------------------- Metals/Mining--.7% 1,000M Alcan, Inc., 5%, 2015 944,730 27 1,000M Alcoa, Inc., 6%, 2012 1,021,739 30 500M Thiokol Corp., 6.625%, 2008 510,677 15 - ---------------------------------------------------------------------------------------------------------------------- 2,477,146 72 - ---------------------------------------------------------------------------------------------------------------------- Real Estate Investment Trusts--1.1% 1,500M Boston Properties, Inc., 5%, 2015 1,408,442 41 700M EOP Operating LP, 8.1%, 2010 760,904 22 700M Mack-Cali Realty LP, 7.75%, 2011 756,569 22 800M Simon Property Group LP, 7.375%, 2018 883,325 26 - ---------------------------------------------------------------------------------------------------------------------- 3,809,240 111 - ---------------------------------------------------------------------------------------------------------------------- Retail-General Merchandise--.2% 500M Federated Department Stores, Inc., 7.45%, 2017 555,475 16 - ---------------------------------------------------------------------------------------------------------------------- Telecommunications--.4% 600M SBC Communications, Inc., 6.25%, 2011 616,331 18 600M Verizon New York, Inc., 6.875%, 2012 617,075 18 - ---------------------------------------------------------------------------------------------------------------------- 1,233,406 36 - ---------------------------------------------------------------------------------------------------------------------- Transportation--.8% Burlington Northern Santa Fe Corp.: 250M 6.75%, 2011 263,911 8 700M 4.875%, 2015 668,162 19 500M 8.125%, 2020 607,560 18 1,000M Union Pacific Corp., 7.375%, 2009 1,058,183 31 - ---------------------------------------------------------------------------------------------------------------------- 2,597,816 76 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Utilities--1.7% $1,000M Arizona Public Service Co., 5.5%, 2035 $868,721 $25 1,000M Carolina Power & Light, Inc., 5.15%, 2015 963,287 28 750M Consumers Energy Co., 6.375%, 2008 759,590 22 576M DPL, Inc., 6.875%, 2011 603,536 18 750M Duke Capital Corp., 8%, 2019 877,805 26 900M PP&L Capital Funding, Inc., 8.375%, 2007 925,783 27 900M Public Service Electric & Gas Co., 6.75%, 2016 972,083 28 - ---------------------------------------------------------------------------------------------------------------------- 5,970,805 174 - ---------------------------------------------------------------------------------------------------------------------- Waste Management--.6% Waste Management, Inc.: 1,000M 6.875%, 2009 1,040,491 31 1,000M 7%, 2028 1,073,680 31 - ---------------------------------------------------------------------------------------------------------------------- 2,114,171 62 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Corporate Bonds (cost $50,256,762) 49,386,135 1,439 - ---------------------------------------------------------------------------------------------------------------------- MORTGAGE-BACKED CERTIFICATES--5.7% Fannie Mae--4.8% 13,036M 5.5%, 4/1/33-8/1/35 12,745,336 371 1,176M 6.5%, 11/1/33 1,211,375 36 2,273M 7%, 3/1/32-8/1/32 2,367,010 69 - ---------------------------------------------------------------------------------------------------------------------- 16,323,721 476 - ---------------------------------------------------------------------------------------------------------------------- Freddie Mac--.9% 3,151M 6%, 9/1/32-10/1/35 3,154,564 92 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Mortgage-Backed Certificates (cost $19,802,284) 19,478,285 568 - ---------------------------------------------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCY OBLIGATIONS--5.0% Fannie Mae: 5,000M 5.4%, 2013 4,921,185 143 5,000M 6%, 2015 4,934,425 143 Federal Farm Credit Bank: 4,650M 4.94%, 2012 4,526,984 132 3,000M 5.33%, 2013 2,954,574 86 - ---------------------------------------------------------------------------------------------------------------------- Total Value of U.S. Government Agency Obligations (cost $17,640,030) 17,337,168 504 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Principal For Each Amount $10,000 of or Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- MUNICIPAL BONDS--3.1% $5,185M Hawkins TX, Indpt. Sch. Dist., 5%, 2031 $5,366,475 $156 2,000M Jefferson Cnty., AL, Ltd. Oblig. Sch. Wts., 5%, 2024 2,057,500 60 1,500M Nassau Cnty., NY, Tobacco Settlement Corp., 5.125%, 2046 1,452,135 42 1,500M Tobacco Settlement Fing. Corp., NJ, Rev. Bonds, 6.75%, 2039 1,678,125 49 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Municipal Bonds (cost $10,359,842) 10,554,235 307 - ---------------------------------------------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCKS--.5% Financials 15,400 Chubb Corp., 7%, 2006 - Series "B" 527,450 15 16,400 Hartford Financial Services Group, Inc., 6%, 2006 - Class "A" 1,174,650 34 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Convertible Preferred Stocks (cost $1,834,048) 1,702,100 49 - ---------------------------------------------------------------------------------------------------------------------- U.S. GOVERNMENT OBLIGATIONS--2.4% $8,500M U.S. Treasury Notes, 4.5%, 2016 (cost $8,463,821) 8,269,574 241 - ---------------------------------------------------------------------------------------------------------------------- PASS THROUGH CERTIFICATES--.2% Transportation 650M Continental Airlines, Inc., 8.388%, 2020 (cost $673,620) 622,609 18 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--2.1% 7,300M Freddie Mac, 4.53%, 4/3/06 (cost $7,298,160) 7,298,160 213 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $297,577,768) 99.9% 342,961,021 9,990 Other Assets, Less Liabilities .1 334,811 10 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $343,295,832 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts REIT Real Estate Investment Trust See notes to financial statements Fund Expenses VALUE FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ---------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,084.94 $7.49 Hypothetical (5% annual return before expenses) $1,000.00 $1,017.75 $7.24 - ---------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,080.88 $11.10 Hypothetical (5% annual return before expenses) $1,000.00 $1,014.26 $10.75 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.44% for Class A shares and 2.14% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Portfolio Composition TOP TEN SECTORS (BAR CHART DATA:) Financials 24.5% Consumer Discretionary 16.2% Consumer Staples 9.8% Industrials 8.4% Energy 8.4% Materials 7.6% Health Care 5.0% Information Technology 4.6% Telecommunication Services 4.3% Utilities 4.1% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments VALUE FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--92.1% Consumer Discretionary--16.3% 27,800 Autoliv, Inc. $1,572,924 $47 63,400 Bob Evans Farms, Inc. 1,883,614 56 34,300 CBS Corporation - Class "B" 822,514 25 91,500 Clear Channel Communications, Inc. 2,654,415 79 159,300 Dollar General Corporation 2,814,831 84 107,400 Family Dollar Stores, Inc. 2,856,840 85 46,200 Genuine Parts Company 2,024,946 61 45,600 H&R Block, Inc. 987,240 29 57,400 Home Depot, Inc. 2,428,020 73 28,400 J.C. Penney Company, Inc. (Holding Co.) 1,715,644 51 50,600 Jones Apparel Group, Inc. 1,789,722 53 47,700 Kenneth Cole Productions, Inc. - Class "A" 1,321,290 40 70,974 Kimball International, Inc. - Class "B" 1,067,449 32 72,600 Lee Enterprises, Inc. 2,416,854 72 101,400 Leggett & Platt, Inc. 2,471,118 74 23,100 Liz Claiborne, Inc. 946,638 28 24,400 Magna International, Inc. - Class "A" 1,846,836 55 105,200 McDonald's Corporation 3,614,672 108 30,000 Modine Manufacturing Company 885,000 26 78,100 Natuzzi SpA (ADR) 570,130 17 77,700 New York Times Company - Class "A" 1,966,587 59 42,500 Newell Rubbermaid, Inc. 1,070,575 32 63,100 Outback Steakhouse, Inc. 2,776,400 83 141,800 Pearson PLC (ADR) 1,963,930 59 82,100 Talbots, Inc. 2,206,027 66 109,600 Time Warner, Inc. 1,840,184 55 87,500 Tribune Company 2,400,125 72 127,500 Walt Disney Company 3,555,975 106 - ---------------------------------------------------------------------------------------------------------------------- 54,470,500 1,627 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--9.8% 75,600 Anheuser-Busch Companies, Inc. 3,233,412 97 71,400 Avon Products, Inc. 2,225,538 66 77,700 Coca-Cola Company 3,253,299 97 59,400 ConAgra Foods, Inc. 1,274,724 38 26,241 Del Monte Foods Company 311,218 9 45,200 Diageo PLC (ADR) 2,867,036 86 42,200 Estee Lauder Companies, Inc. - Class "A" 1,569,418 47 15,900 Fomento Economico Mexicano SA de CV (ADR) 1,457,394 44 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples (continued) 53,800 H.J. Heinz Company $2,040,096 $61 37,800 Kimberly-Clark Corporation 2,184,840 65 86,600 Kraft Foods, Inc. - Class "A" 2,624,846 78 52,500 Ruddick Corporation 1,276,275 38 135,400 Sara Lee Corporation 2,420,952 72 58,200 Tasty Baking Company 465,600 14 106,700 The Topps Company, Inc. 935,759 28 39,100 UST, Inc. 1,626,560 49 65,300 Wal-Mart Stores, Inc. 3,084,772 92 - ---------------------------------------------------------------------------------------------------------------------- 32,851,739 981 - ---------------------------------------------------------------------------------------------------------------------- Energy--8.4% 24,500 Anadarko Petroleum Corporation 2,474,745 74 42,900 BP PLC (ADR) 2,957,526 88 66,117 Chevron Corporation 3,832,802 114 51,400 ConocoPhillips 3,245,910 97 38,500 Diamond Offshore Drilling, Inc. 3,445,750 103 23,424 Kerr-McGee Corporation 2,236,524 67 54,400 Marathon Oil Corporation 4,143,648 124 49,200 Royal Dutch Shell PLC - Class "A" (ADR) 3,063,192 91 52,600 Tidewater, Inc. 2,905,098 87 - ---------------------------------------------------------------------------------------------------------------------- 28,305,195 845 - ---------------------------------------------------------------------------------------------------------------------- Financials--24.0% 45,300 A.G. Edwards, Inc. 2,258,658 68 14,600 ACE, Ltd. 759,346 23 15,700 Allstate Corporation 818,127 24 47,300 AmSouth Bancorporation 1,279,465 38 108,700 Amvescap PLC (ADR) 2,050,082 61 59,800 Aon Corporation 2,482,298 74 95,300 Aspen Insurance Holdings, Ltd. 2,350,098 70 35,100 Assured Guaranty, Ltd. 877,500 26 134,400 Bank Mutual Corporation 1,591,296 48 88,266 Bank of America Corporation 4,019,634 120 94,900 Bank of New York Company, Inc. 3,420,196 102 69,300 Brookfield Asset Management, Inc. - Class "A" 3,815,658 114 50,800 Brookline Bancorp, Inc. 786,892 24 17,728 Chubb Corporation 1,691,960 51 50,247 Cincinnati Financial Corporation 2,113,891 63 70,100 Citigroup, Inc. 3,310,823 99 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) VALUE FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 38,000 Comerica, Inc. $2,202,860 $66 56,900 Eagle Hospitality Properties Trust, Inc. 573,552 17 34,700 Erie Indemnity Company - Class "A" 1,826,608 55 24,800 FBL Financial Group, Inc. - Class "A" 854,360 26 78,400 Hudson City Bancorp, Inc. 1,041,936 31 30,200 IPC Holdings, Ltd. 847,110 25 35,600 Jefferson-Pilot Corporation 1,991,464 60 85,200 JPMorgan Chase & Company 3,547,728 106 52,100 KeyCorp 1,917,280 57 15,100 Lincoln National Corporation 824,309 25 42,200 Merrill Lynch & Company, Inc. 3,323,672 99 34,000 Montpelier Re Holdings, Ltd. 554,200 17 50,200 Morgan Stanley 3,153,564 94 111,400 NewAlliance Bancshares, Inc. 1,607,502 48 51,200 North Fork Bancorporation, Inc. 1,476,096 44 29,900 One Liberty Properties, Inc. (REIT) 592,917 18 50,900 Plum Creek Timber Company, Inc. (REIT) 1,879,737 56 30,100 PMI Group, Inc. 1,382,192 41 30,000 PNC Financial Services Group, Inc. 2,019,300 60 51,300 Protective Life Corporation 2,551,662 76 82,100 Regions Financial Corporation 2,887,457 86 15,800 State National Bancshares, Inc. 430,550 13 37,893 State Street Corporation 2,289,874 68 32,800 SunTrust Banks, Inc. 2,386,528 71 26,079 TD Banknorth, Inc. 765,419 23 54,000 Waddell & Reed Financial, Inc. - Class "A" 1,247,400 37 41,600 Wells Fargo & Company 2,656,992 79 - ---------------------------------------------------------------------------------------------------------------------- 80,458,19 32,403 - ---------------------------------------------------------------------------------------------------------------------- Health Care--5.0% 68,800 Abbott Laboratories 2,921,936 87 38,300 Biomet, Inc. 1,360,416 41 41,800 GlaxoSmithKline PLC (ADR) 2,186,558 65 55,000 Johnson & Johnson 3,257,100 97 33,000 Novartis AG (ADR) 1,829,520 55 131,500 Pfizer, Inc. 3,276,980 98 7,300 Sanofi-Aventis (ADR) 346,385 10 82,100 Schering-Plough Corporation 1,559,079 47 - ---------------------------------------------------------------------------------------------------------------------- 16,737,974 500 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials--8.5% 29,800 Adesa, Inc. $796,852 $24 2,600 Alexander & Baldwin, Inc. 123,968 4 27,800 Avery Dennison Corporation 1,625,744 49 25,500 Baldor Electric Company 863,685 26 102,700 Cendant Corporation 1,781,845 53 51,200 Dover Corporation 2,486,272 74 58,600 Federal Signal Corporation 1,084,100 32 44,400 General Dynamics Corporation 2,840,712 85 71,300 Honeywell International, Inc. 3,049,501 91 72,800 Masco Corporation 2,365,272 71 44,700 Norfolk Southern Corporation 2,416,929 72 37,800 Pall Corporation 1,178,982 35 52,600 Pitney Bowes, Inc. 2,258,118 67 16,300 SPX Corporation 870,746 26 17,600 Stewart & Stevenson Services, Inc. 642,048 19 72,400 Tyco International, Ltd. 1,946,112 58 108,400 Werner Enterprises, Inc. 1,991,308 60 - ---------------------------------------------------------------------------------------------------------------------- 28,322,194 846 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--4.6% 99,400 * Agile Software Corporation 758,422 23 46,000 Automatic Data Processing, Inc. 2,101,280 63 77,200 AVX Corporation 1,366,440 41 97,900 Hewlett-Packard Company 3,220,910 96 48,600 Intel Corporation 940,410 28 16,600 * Lexmark International Inc. - Class "A" 753,308 22 90,800 Methode Electronics, Inc. 988,812 30 57,500 Motorola, Inc. 1,317,325 39 92,800 Nokia Corporation - Class "A" (ADR) 1,922,816 57 59,100 * Planar Systems, Inc. 999,972 30 57,400 Woodhead Industries, Inc. 952,840 29 - ---------------------------------------------------------------------------------------------------------------------- 15,322,535 458 - ---------------------------------------------------------------------------------------------------------------------- Materials--7.6% 31,500 Air Products & Chemicals, Inc. 2,116,485 63 40,200 Albemarle Corporation 1,823,070 55 60,100 Alcoa, Inc. 1,836,656 55 106,830 Chemtura Corporation 1,258,457 38 56,600 Compass Minerals International, Inc. 1,414,434 42 63,800 Dow Chemical Company 2,590,280 77 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) VALUE FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Materials (continued) 71,100 Du Pont (E.I.) de Nemours & Company $3,001,131 $90 56,300 Glatfelter 1,031,979 31 59,500 Lubrizol Corporation 2,549,575 76 56,100 MeadWestvaco Corporation 1,532,091 46 73,830 Myers Industries, Inc. 1,180,542 35 146,000 Sappi, Ltd. (ADR) 2,153,500 64 83,900 Sonoco Products Company 2,841,693 85 4,723 Tronox, Inc. - Class "B" 80,248 2 - ---------------------------------------------------------------------------------------------------------------------- 25,410,141 759 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--4.1% 9,651 ALLTEL Corporation 624,902 19 76,600 AT&T, Inc. 2,071,264 62 61,500 BellSouth Corporation 2,130,975 64 60,400 CT Communications, Inc. 820,836 24 46,300 D&E Communications, Inc. 520,412 15 60,100 Nippon Telegraph and Telephone Corporation (ADR) 1,295,155 39 67,500 Sprint Nextel Corporation 1,744,200 52 24,000 Telephone & Data Systems, Inc. 946,560 28 24,000 Telephone & Data Systems, Inc. - Special Shares 906,000 27 73,828 Verizon Communications, Inc. 2,514,582 75 - ---------------------------------------------------------------------------------------------------------------------- 13,574,886 405 - ---------------------------------------------------------------------------------------------------------------------- Utilities--3.8% 34,250 American States Water Company 1,279,580 38 36,100 KeySpan Corporation 1,475,407 44 50,300 MDU Resources Group, Inc. 1,682,535 50 85,900 NiSource, Inc. 1,736,898 52 37,700 Northwest Natural Gas Company 1,337,973 40 40,300 ONEOK, Inc. 1,299,675 39 51,200 Southwest Gas Corporation 1,431,040 43 48,700 United Utilities PLC (ADR) 1,180,975 35 50,300 Vectren Corporation 1,326,914 40 - ---------------------------------------------------------------------------------------------------------------------- 12,750,997 381 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $238,939,468) 308,204,354 9,205 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCKS--.4% Financials 56,900 Lehman Brothers Holdings, Inc., 6.25%, 2007 - Series "GIS" (cost $1,446,983) $1,522,075 $45 - ---------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS--.4% Telecommunication Services--.2% 27,300 Verizon South, Inc., 7%, 2041 - Series "F" 689,052 21 - ---------------------------------------------------------------------------------------------------------------------- Utilities--.2% 25,200 Entergy Louisiana, Inc., 7.6%, 2032 637,056 19 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Preferred Stocks (cost $1,328,111) 1,326,108 40 - ---------------------------------------------------------------------------------------------------------------------- CORPORATE BONDS--.1% Utilities $500M Union Electric Co., 6.75%, 2008 (cost $499,569) 511,850 15 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--4.0% 5,500M Federal Home Loan Bank, 4.44%, 4/5/06 5,497,276 164 8,000M Freddie Mac, 4.53%, 4/3/06 7,997,984 239 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Short-Term U.S. Government Agency Obligations (cost $13,495,260) 13,495,260 403 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--3.1% 2,000M General Electric Capital Corp,, 4.72%, 4/3/06 1,999,475 60 8,200M Toyota Motor Credit Co., 4.75%, 4/6/06 8,194,587 245 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Short-Term Corporate Notes (cost $10,194,062) 10,194,062 305 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $265,903,453) 100.1% 335,253,709 10,013 Excess of Liabilities Over Other Assets (.1) (437,105) (13) - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $334,816,604 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts REIT Real Estate Investment Trust See notes to financial statements Fund Expenses BLUE CHIP FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ---------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,058.79 $7.60 Hypothetical (5% annual return before expenses) $1,000.00 $1,017.55 $7.44 - ---------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,054.91 $11.17 Hypothetical (5% annual return before expenses) $1,000.00 $1,014.06 $10.95 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.48% for Class A shares and 2.18% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived. Portfolio Composition TOP TEN SECTORS (BAR CHART DATA:) Financials 18.9% Information Technology 16.2% Industrials 13.0% Health Care 12.5% Consumer Staples 11.2% Consumer Discretionary 11.1% Energy 9.7% Materials 2.8% Telecommunication Services 2.7% Utilities 1.0% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments BLUE CHIP FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--99.3% Consumer Discretionary--11.1% 36,200 Best Buy Company, Inc. $2,024,666 $41 31,500 Carnival Corporation 1,492,155 30 81,300 CBS Corporation - Class "B" 1,949,574 40 51,400 Clear Channel Communications, Inc. 1,491,114 31 71,996 * Comcast Corporation - Class "A" 1,883,415 39 48,900 * Comcast Corporation - Special Class "A" 1,277,268 26 31,500 * eBay, Inc. 1,230,390 25 99,200 Gap, Inc. 1,853,056 38 55,000 H&R Block, Inc. 1,190,750 24 79,800 Hilton Hotels Corporation 2,031,708 42 135,700 Home Depot, Inc. 5,740,110 118 54,900 * Kohl's Corporation 2,910,249 60 48,700 Lowe's Companies, Inc. 3,138,228 64 101,100 McDonald's Corporation 3,473,796 71 158,600 News Corporation - Class "A" 2,634,346 54 33,100 NIKE, Inc. - Class "B" 2,816,810 58 73,800 Target Corporation 3,838,338 79 258,300 Time Warner, Inc. 4,336,857 89 52,800 TJX Companies, Inc. 1,310,496 27 49,800 Tribune Company 1,366,014 28 62,600 * Viacom, Inc. - Class "B" 2,428,880 50 139,400 Walt Disney Company 3,887,866 80 - ---------------------------------------------------------------------------------------------------------------------- 54,306,086 1,114 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--11.2% 74,600 Altria Group, Inc. 5,286,156 108 68,800 Anheuser-Busch Companies, Inc. 2,942,576 60 88,600 Avon Products, Inc. 2,761,662 57 142,900 Coca-Cola Company 5,983,223 123 72,400 Coca-Cola Enterprises, Inc. 1,472,616 30 27,000 Colgate-Palmolive Company 1,541,700 32 36,800 Costco Wholesale Corporation 1,993,088 41 95,600 CVS Corporation 2,855,572 59 25,600 Estee Lauder Companies, Inc. - Class "A" 952,064 20 32,900 General Mills, Inc. 1,667,372 34 25,800 Hershey Foods Corporation 1,347,534 28 55,800 Kimberly-Clark Corporation 3,225,240 66 104,100 PepsiCo, Inc. 6,015,939 123 130,040 Procter & Gamble Company 7,492,905 154 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) BLUE CHIP FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples (continued) 54,300 Walgreen Company $2,341,959 $48 146,100 Wal-Mart Stores, Inc. 6,901,764 141 - ---------------------------------------------------------------------------------------------------------------------- 54,781,370 1,124 - ---------------------------------------------------------------------------------------------------------------------- Energy--9.7% 39,600 BP PLC (ADR) 2,730,024 56 22,000 Burlington Resources, Inc. 2,022,020 41 172,200 Chevron Corporation 9,982,434 205 66,000 ConocoPhillips 4,167,900 86 231,000 ExxonMobil Corporation 14,058,660 288 37,300 Halliburton Company 2,723,646 56 42,100 Schlumberger, Ltd. 5,328,597 109 55,100 * Transocean, Inc. 4,424,530 91 29,200 Valero Energy Corporation 1,745,576 36 - ---------------------------------------------------------------------------------------------------------------------- 47,183,387 968 - ---------------------------------------------------------------------------------------------------------------------- Financials--19.0% 44,000 ACE, Ltd. 2,288,440 47 27,700 Allstate Corporation 1,443,447 30 89,500 American Express Company 4,703,225 97 121,600 American International Group, Inc. 8,036,544 165 17,900 Ameriprise Financial, Inc. 806,574 17 186,166 Bank of America Corporation 8,478,000 174 117,700 Bank of New York Company, Inc. 4,241,908 87 750 * Berkshire Hathaway, Inc. - Class "B" 2,259,000 46 43,100 Capital One Financial Corporation 3,470,412 71 16,900 Chubb Corporation 1,612,936 33 250,500 Citigroup, Inc. 11,831,115 243 28,600 Fannie Mae 1,470,040 30 40,500 Freddie Mac 2,470,500 51 16,900 Goldman Sachs Group, Inc. 2,652,624 54 170,968 JPMorgan Chase & Company 7,119,107 146 9,500 Lehman Brothers Holdings, Inc. 1,373,035 28 40,500 Marsh & McLennan Companies, Inc. 1,189,080 24 36,600 Mellon Financial Corporation 1,302,960 27 47,600 Merrill Lynch & Company, Inc. 3,748,976 77 80,300 Morgan Stanley 5,044,446 103 41,000 St. Paul Travelers Companies, Inc. 1,713,390 35 20,500 SunTrust Banks, Inc. 1,491,580 31 56,500 U.S. Bancorp 1,723,250 35 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 75,600 Wachovia Corporation $4,237,380 $87 70,200 Washington Mutual, Inc. 2,991,924 61 65,000 Wells Fargo & Company 4,151,550 85 18,400 Willis Group Holdings, Ltd. 630,384 13 - ---------------------------------------------------------------------------------------------------------------------- 92,481,827 1,897 - ---------------------------------------------------------------------------------------------------------------------- Health Care--12.5% 93,500 Abbott Laboratories 3,970,945 81 55,600 Aetna, Inc. 2,732,184 56 75,700 * Amgen, Inc. 5,507,175 113 39,500 Baxter International, Inc. 1,532,995 31 95,700 * Boston Scientific Corporation 2,205,885 45 147,200 Bristol-Myers Squibb Company 3,622,592 74 166,800 Johnson & Johnson 9,877,896 203 80,700 Medtronic, Inc. 4,095,525 84 69,600 Merck & Company, Inc. 2,452,008 50 89,300 Novartis AG (ADR) 4,950,792 101 367,060 Pfizer, Inc. 9,147,135 188 10,900 Sanofi-Aventis (ADR) 517,205 11 11,000 Stryker Corporation 487,740 10 36,800 Teva Pharmaceutical Industries, Ltd. (ADR) 1,515,424 31 26,400 * Triad Hospitals, Inc. 1,106,160 23 80,800 UnitedHealth Group, Inc. 4,513,488 93 60,100 Wyeth 2,916,052 60 - ---------------------------------------------------------------------------------------------------------------------- 61,151,201 1,254 - ---------------------------------------------------------------------------------------------------------------------- Industrials--13.0% 51,100 3M Company 3,867,759 79 36,600 Boeing Company 2,852,238 58 63,000 Caterpillar, Inc. 4,524,030 93 154,600 Cendant Corporation 2,682,310 55 33,000 Dover Corporation 1,602,480 33 38,100 Emerson Electric Company 3,186,303 65 409,000 General Electric Company 14,225,020 292 55,300 Honeywell International, Inc. 2,365,181 49 14,700 Illinois Tool Works, Inc. 1,415,757 29 24,800 ITT Industries, Inc. 1,394,256 29 56,100 Lockheed Martin Corporation 4,214,793 86 78,300 Masco Corporation 2,543,967 52 42,800 Northrop Grumman Corporation 2,922,812 60 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) BLUE CHIP FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials (continued) 164,900 Tyco International, Ltd. $4,432,512 $91 29,300 Union Pacific Corporation 2,735,155 56 37,400 United Parcel Service, Inc. - Class "B" 2,968,812 61 94,800 United Technologies Corporation 5,495,556 113 - ---------------------------------------------------------------------------------------------------------------------- 63,428,941 1,301 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--16.2% 37,400 Accenture, Ltd. - Class "A" 1,124,618 23 34,500 Analog Devices, Inc. 1,321,005 27 15,400 * Apple Computer, Inc. 965,888 20 77,100 Applied Materials, Inc. 1,350,021 28 27,000 Automatic Data Processing, Inc. 1,233,360 25 263,300 * Cisco Systems, Inc. 5,705,711 117 128,200 * Corning, Inc. 3,449,862 71 166,700 * Dell, Inc. 4,960,992 102 338,600 * EMC Corporation 4,615,118 95 93,200 First Data Corporation 4,363,624 89 110,900 Hewlett-Packard Company 3,648,610 75 320,200 Intel Corporation 6,195,870 127 71,700 International Business Machines Corporation 5,913,099 121 34,900 Maxim Integrated Products, Inc. 1,296,535 27 505,300 Microsoft Corporation 13,749,213 282 104,100 Motorola, Inc. 2,384,931 49 46,100 National Semiconductor Corporation 1,283,424 26 206,700 Nokia Corporation - Class "A" (ADR) 4,282,824 88 229,300 * Oracle Corporation 3,139,117 64 40,500 QUALCOMM, Inc. 2,049,705 42 98,791 * Symantec Corporation 1,662,653 34 109,900 Texas Instruments, Inc. 3,568,453 73 55,300 * Xerox Corporation 840,560 17 - ---------------------------------------------------------------------------------------------------------------------- 79,105,193 1,622 - ---------------------------------------------------------------------------------------------------------------------- Materials--2.8% 59,000 Alcoa, Inc. 1,803,040 37 40,822 Cemex SA de CV (ADR) 2,664,860 55 87,900 Dow Chemical Company 3,568,740 73 57,900 DuPont (E.I.) de Nemours & Company 2,443,959 50 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Materials (continued) 66,200 International Paper Company $2,288,534 $47 18,300 Newmont Mining Corporation 949,587 19 - ---------------------------------------------------------------------------------------------------------------------- 13,718,720 281 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--2.8% 145,800 AT&T, Inc. 3,942,432 81 206,366 Sprint Corporation 5,332,497 109 121,500 Verizon Communications, Inc. 4,138,290 85 - ---------------------------------------------------------------------------------------------------------------------- 13,413,219 275 - ---------------------------------------------------------------------------------------------------------------------- Utilities--1.0% 160,700 Duke Energy Corporation 4,684,405 96 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $358,670,934) 484,254,349 9,932 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--.8% $3,800M General Electric Capital Corp., 4.75%, 4/10/06 (cost $3,795,486) 3,795,486 78 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $362,466,420) 100.1% 488,049,835 10,010 Excess of Liabilities Over Other Assets (.1) (496,806) (10) - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $487,553,029 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements Fund Expenses GROWTH & INCOME FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ---------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,087.48 $7.23 Hypothetical (5% annual return before expenses) $1,000.00 $1,018.00 $6.99 - ---------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,083.47 $10.86 Hypothetical (5% annual return before expenses) $1,000.00 $1,014.51 $10.50 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.39% for Class A shares and 2.09% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Portfolio Composition TOP TEN SECTORS (BAR CHART DATA:) Information Technology 18.9% Consumer Discretionary 17.7% Financials 16.4% Industrials 14.7% Health Care 12.3% Energy 8.2% Consumer Staples 5.7% Materials 4.1% Telecommunication Services 0.9% Utilities 0.9% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments GROWTH & INCOME FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--99.0% Consumer Discretionary--17.7% 212,500 Blockbuster, Inc. - Class A $843,625 $11 150,000 CBS Corporation - Class B 3,597,000 48 75,000 Claire's Stores, Inc. 2,723,250 36 200,000 Clear Channel Communications, Inc. 5,802,000 78 245,602 * Cost Plus, Inc. 4,199,794 56 230,000 Dollar General Corporation 4,064,100 54 200,000 * Eddie Bauer Holdings, Inc. 2,580,000 35 50,000 Genuine Parts Company 2,191,500 29 350,000 H&R Block, Inc. 7,577,500 101 110,000 * Helen of Troy, Ltd. 2,332,000 31 140,000 Home Depot, Inc. 5,922,000 79 55,000 J.C. Penney Company, Inc. (Holding Co.) 3,322,550 45 75,000 Jones Apparel Group, Inc. 2,652,750 36 148,200 Kenneth Cole Productions, Inc. - Class A 4,105,140 55 270,000 Leggett & Platt, Inc. 6,579,900 88 212,200 * Lincoln Educational Services Corporation 3,596,790 48 210,000 McDonald's Corporation 7,215,600 97 182,500 * Morgans Hotel Group Company 3,222,950 43 175,000 Movado Group, Inc. 4,039,000 54 215,000 Newell Rubbermaid, Inc. 5,415,850 73 256,100 Orient-Express Hotels, Ltd. 10,046,803 134 85,000 Polo Ralph Lauren Corporation - Class A 5,151,850 69 375,600 * Prestige Brands Holdings, Inc. 4,571,052 61 325,000 * Quiksilver, Inc. 4,504,500 60 241,900 RadioShack Corporation 4,651,737 62 23,200 Ross Stores, Inc. 677,208 9 174,500 Russell Corporation 2,408,100 32 82,500 Sherwin-Williams Company 4,078,800 55 120,000 * Steiner Leisure Ltd. 4,860,000 65 71,300 * Tommy Hilfiger Corporation 1,174,311 16 87,500 * Viacom, Inc. - Class B 3,395,000 46 455,400 Westwood One, Inc. 5,027,616 67 - ---------------------------------------------------------------------------------------------------------------------- 132,530,276 1,773 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--5.7% 135,000 Altria Group, Inc. 9,566,100 128 200,000 Avon Products, Inc. 6,234,000 82 50,000 Coca-Cola Company 2,093,500 28 47,500 Kimberly-Clark Corporation 2,745,500 37 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments GROWTH & INCOME FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples (continued) 290,000 Nu Skin Enterprises, Inc. - Class A $5,083,700 $68 50,000 PepsiCo, Inc. 2,889,500 39 75,000 Procter & Gamble Company 4,321,500 58 91,764 Tootsie Roll Industries, Inc. 2,685,924 36 90,000 Wal-Mart Stores, Inc. 4,251,600 57 90,000 WD-40 Company 2,776,500 37 - ---------------------------------------------------------------------------------------------------------------------- 42,647,824 570 - ---------------------------------------------------------------------------------------------------------------------- Energy--8.2% 40,000 Anadarko Petroleum Corporation 4,040,400 54 100,000 Chesapeake Energy Corporation 3,141,000 42 90,000 ConocoPhillips 5,683,500 76 115,000 ExxonMobil Corporation 6,998,900 94 16,548 Marathon Oil Corporation 1,260,461 17 80,000 Noble Corporation 6,488,000 87 16,600 * PHI, Inc. - Non Voting Shares 609,552 8 115,000 Sasol, Ltd. (ADR) 4,350,450 58 150,000 Suncor Energy, Inc. 11,553,000 154 60,000 * Swift Energy Company 2,247,600 30 120,000 * Transocean, Inc. 9,636,000 129 120,000 XTO Energy, Inc. 5,228,400 70 - ---------------------------------------------------------------------------------------------------------------------- 61,237,263 819 - ---------------------------------------------------------------------------------------------------------------------- Financials--15.7% 50,000 American Express Company 2,627,500 35 90,000 American International Group, Inc. 5,948,100 80 10,000 Ameriprise Financial, Inc. 450,600 6 60,000 Astoria Financial Corporation 1,857,600 25 197,718 Bank of America Corporation 9,004,078 120 150,000 Brookline Bancorp, Inc. 2,323,500 31 150,000 Citigroup, Inc. 7,084,500 95 200,000 Colonial BancGroup, Inc. 5,000,000 67 60,000 Endurance Specialty Holdings, Ltd. 1,953,000 26 50,000 Fannie Mae 2,570,000 34 155,000 JPMorgan Chase & Company 6,454,200 86 37,500 Lehman Brothers Holdings, Inc. 5,419,875 72 105,000 Merrill Lynch & Company, Inc. 8,269,800 111 152,000 Montpelier Re Holdings, Ltd. 2,477,600 33 90,000 Morgan Stanley 5,653,800 76 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 90,000 National City Corporation $3,141,000 $42 230,000 New York Community Bancorp, Inc. 4,029,600 54 250,000 NewAlliance Bancshares, Inc. 3,607,500 48 255,000 North Fork Bancorporation, Inc. 7,351,650 98 75,000 Plum Creek Timber Company, Inc. (REIT) 2,769,750 37 120,000 South Financial Group, Inc. 3,138,000 42 200,000 Sovereign Bancorp, Inc. 4,382,000 59 150,000 U.S. Bancorp 4,575,000 61 117,570 U.S.B. Holding Company, Inc. 2,697,056 36 100,000 Wachovia Corporation 5,605,000 75 110,000 Washington Mutual, Inc. 4,688,200 63 70,000 Wells Fargo & Company 4,470,900 60 - ---------------------------------------------------------------------------------------------------------------------- 117,549,809 1,572 - ---------------------------------------------------------------------------------------------------------------------- Health Care--12.3% 160,000 Abbott Laboratories 6,795,200 91 90,000 Aetna, Inc. 4,422,600 59 46,700 * Amgen, Inc. 3,397,425 45 100,000 * Andrx Corporation 2,374,000 32 22,417 Baxter International, Inc. 870,004 12 100,000 * Boston Scientific Corporation 2,305,000 31 90,000 * Charles River Laboratories International, Inc. 4,411,800 59 20,000 * Genentech, Inc. 1,690,200 23 135,000 Johnson & Johnson 7,994,700 107 50,000 * Laboratory Corporation of America Holdings 2,924,000 39 53,800 Medicis Pharmaceutical Corporation - Class A 1,753,880 23 50,000 Medtronic, Inc. 2,537,500 34 80,000 Merck & Company, Inc. 2,818,400 38 50,000 * Momenta Pharmaceuticals, Inc. 983,000 13 400,000 Pfizer, Inc. 9,968,000 133 85,000 Sanofi-Aventis (ADR) 4,033,250 54 40,000 Stryker Corporation 1,773,600 24 220,000 * Thermo Electron Corporation 8,159,800 109 75,000 * Triad Hospitals, Inc. 3,142,500 42 55,000 UnitedHealth Group, Inc. 3,072,300 41 75,000 * Waters Corporation 3,236,250 43 80,000 * WellPoint, Inc. 6,194,400 83 140,000 Wyeth 6,792,800 91 - ---------------------------------------------------------------------------------------------------------------------- 91,650,609 1,226 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) GROWTH & INCOME FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials--14.7% 115,000 3M Company $8,704,350 $116 50,400 Alexander & Baldwin, Inc. 2,403,072 32 100,000 American Standard Companies, Inc. 4,286,000 57 89,500 * BE Aerospace, Inc. 2,248,240 30 170,000 Briggs & Stratton Corporation 6,012,900 80 72,500 Burlington Northern Santa Fe Corporation 6,041,425 81 500,000 Cendant Corporation 8,675,000 116 36,000 Eaton Corporation 2,626,920 35 155,000 * Gardner Denver, Inc. 10,106,000 135 50,000 Harsco Corporation 4,131,000 55 190,000 Honeywell International, Inc. 8,126,300 109 45,000 Illinois Tool Works, Inc. 4,333,950 58 282,600 Knoll, Inc. 6,025,032 81 60,000 Lockheed Martin Corporation 4,507,800 60 250,000 * Navigant Consulting, Inc. 5,337,500 71 90,000 Northrop Grumman Corporation 6,146,100 82 75,400 * Pike Electric Corporation 1,584,154 21 200,000 * Pinnacle Airlines Corporation 1,332,000 18 60,000 Pitney Bowes, Inc. 2,575,800 35 88,300 * TAL International Group , Inc. 2,128,913 29 150,000 Tyco International, Ltd. 4,032,000 54 145,000 United Technologies Corporation 8,405,650 113 - ---------------------------------------------------------------------------------------------------------------------- 109,770,106 1,468 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--18.8% 110,000 Amphenol Corporation - Class A 5,739,800 77 240,000 * Cisco Systems, Inc. 5,200,800 70 165,700 * Electronics for Imaging, Inc. 4,634,629 62 350,000 * EMC Corporation 4,770,500 64 300,000 * Entrust, Inc. 1,350,000 18 120,000 First Data Corporation 5,618,400 75 235,000 Hewlett-Packard Company 7,731,500 103 175,000 Intel Corporation 3,386,250 45 110,000 International Business Machines Corporation 9,071,700 121 50,000 * International Rectifier Corporation 2,071,500 28 60,000 * Lam Research Corporation 2,580,000 35 350,000 Microsoft Corporation 9,523,500 127 275,000 Motorola, Inc. 6,300,250 84 106,300 * NCI, Inc. - Class A 1,488,200 20 375,000 Nokia Corporation - Class A (ADR) 7,770,000 104 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 163,000 * OmniVision Technologies, Inc. $4,922,600 $66 185,000 * Openwave Systems, Inc. 3,992,300 53 120,000 * Palm, Inc. 2,779,200 37 270,000 * Paxar Corporation 5,283,900 71 125,000 * Polycom, Inc. 2,710,000 36 135,000 QUALCOMM, Inc. 6,832,350 91 30,000 * SanDisk Corporation 1,725,600 23 212,300 * Silicon Image, Inc. 2,188,813 29 400,000 * Smart Modular Technologies (WWH), Inc. 3,620,000 48 65,000 StarTek, Inc. 1,531,400 21 329,840 * Symantec Corporation 5,551,207 74 194,060 Taiwan Semiconductor Manufacturing Co., Ltd. (ADR) 1,952,244 26 95,000 * Tech Data Corporation 3,506,450 47 350,000 * TIBCO Software, Inc. 2,926,000 39 89,600 * Varian Semiconductor Equipment Associates, Inc. 2,515,968 34 295,000 * VeriSign, Inc. 7,077,050 95 175,000 Xilinx, Inc. 4,455,500 60 - ---------------------------------------------------------------------------------------------------------------------- 140,807,611 1,883 - ---------------------------------------------------------------------------------------------------------------------- Materials--4.1% 70,000 Ashland, Inc. 4,975,600 67 80,000 Dow Chemical Company 3,248,000 43 60,000 Freeport-McMoRan Copper & Gold, Inc. - Class B 3,586,200 48 122,100 Lubrizol Corporation 5,231,985 70 45,000 PPG Industries, Inc. 2,850,750 38 60,000 Praxair, Inc. 3,309,000 44 200,000 RPM International, Inc. 3,588,000 48 90,000 Temple-Inland, Inc. 4,009,500 54 - ---------------------------------------------------------------------------------------------------------------------- 30,799,035 412 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--.9% 165,000 AT&T, Inc. 4,461,600 60 75,000 Verizon Communications, Inc. 2,554,500 34 - ---------------------------------------------------------------------------------------------------------------------- 7,016,100 94 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) GROWTH & INCOME FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Utilities--.9% 115,400 Atmos Energy Corporation $3,038,482 $41 75,000 Consolidated Edison, Inc. 3,262,500 44 - ---------------------------------------------------------------------------------------------------------------------- 6,300,982 85 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $581,110,708) 740,309,615 9,902 - ---------------------------------------------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCKS--.7% Financials 50,000 Chubb Corp., 7%, 2006 - Series B 1,712,500 23 50,000 Hartford Financial Services Group, Inc., 6%, 2006 - Class A 3,581,250 48 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Convertible Preferred Stocks (cost $3,625,823) 5,293,750 71 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--.2% $1,500M ChevronTexaco Funding Corp., 4.71%, 4/13/06 (cost $1,497,644) 1,497,644 20 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $586,234,175) 99.90% 747,101,009 9,993 Other Assets, Less Liabilities 0.1 563,482 7 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.00% $747,664,491 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts REIT Real Estate Investment Trust See notes to financial statements Fund Expenses ALL-CAP GROWTH FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ---------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,090.71 $8.24 Hypothetical (5% annual return before expenses) $1,000.00 $1,017.05 $7.95 - ---------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,086.86 $11.86 Hypothetical (5% annual return before expenses) $1,000.00 $1,013.56 $11.45 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.58% for Class A shares and 2.28% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Portfolio Composition BY SECTOR (BAR CHART DATA:) Information Technology 29.5% Health Care 20.5% Financials 17.5% Industrials 12.0% Consumer Discretionary 8.8% Energy 6.0% Telecommunication Services 1.1% Materials 0.3% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments ALL-CAP GROWTH FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--95.5% Consumer Discretionary--8.8% 16,840 * California Pizza Kitchen, Inc. $546,458 $25 16,430 * Citi Trends, Inc. 653,257 29 39,670 D.R. Horton, Inc. 1,317,837 59 3,923 * GameStop Corporation - Class A 184,930 8 15,460 * GameStop Corporation - Class B 669,727 30 31,658 Geox SpA 421,422 19 15,800 * Gildan Activewear, Inc. 750,816 34 11,400 * Panera Bread Company - Class A 857,052 39 56,100 PETsMART, Inc. 1,578,654 71 21,300 Phillips Van-Heusen Corporation 813,873 37 34,420 * Pinnacle Entertainment, Inc. 969,611 44 10,540 * Pixar 676,036 30 291,700 * Sirius Satellite Radio, Inc. 1,481,836 67 64,530 Starwood Hotels & Resorts Worldwide, Inc. 4,370,617 197 49,200 * Univision Communications, Inc. - Class A 1,695,924 76 48,050 Walt Disney Company 1,340,114 60 28,500 Williams-Sonoma, Inc. 1,208,400 54 - ---------------------------------------------------------------------------------------------------------------------- 19,536,564 879 - ---------------------------------------------------------------------------------------------------------------------- Energy--5.9% 7,090 Arch Coal, Inc. 538,415 24 13,165 Cabot Oil & Gas Corporation - Class A 630,998 29 156,870 Cameco Corporation 5,647,320 254 25,200 GlobalSantaFe Corporation 1,530,900 69 33,820 Halliburton Company 2,469,536 111 3,770 Oil Service HOLDRs Trust 553,474 25 38,220 Petro-Canada 1,818,890 82 - ---------------------------------------------------------------------------------------------------------------------- 13,189,533 594 - ---------------------------------------------------------------------------------------------------------------------- Financials--17.5% 8,495 * Affiliated Managers Group, Inc. 905,652 41 16,220 * Arch Capital Group, Ltd. 936,543 42 9,010 Chicago Mercantile Exchange Holdings, Inc. - Class A 4,031,975 181 202,660 Countrywide Financial Corporation 7,437,622 335 53,400 * E*TRADE Financial Corporation 1,440,732 65 56,050 Franklin Resources, Inc. 5,282,152 238 11,400 Jones Lang LaSalle, Inc. 872,556 39 17,960 LaSalle Hotel Properties 736,360 33 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 45,610 Legg Mason, Inc. $5,716,301 $257 31,020 Moody's Corporation 2,216,689 100 22,040 * NASDAQ Stock Market, Inc. 882,482 40 13,080 National Financial Partners Corporation 739,282 33 27,940 Nuveen Investments, Inc. - Class A 1,345,311 60 16,290 * ProAssurance Corporation 847,080 38 49,510 UBS AG 5,444,615 245 - ---------------------------------------------------------------------------------------------------------------------- 38,835,352 1,747 - ---------------------------------------------------------------------------------------------------------------------- Health Care--20.5% 21,640 * Alkermes, Inc. 477,162 22 35,900 * Amgen, Inc. 2,611,725 118 14,590 * Amylin Pharmaceuticals, Inc. 714,180 32 148,250 AstraZeneca PLC (ADR) 7,446,597 335 18,200 * Cephalon, Inc. 1,096,550 49 19,340 * Covance, Inc. 1,136,225 51 21,800 * Coventry Health Care, Inc. 1,176,764 53 25,900 * DaVita, Inc. 1,559,439 70 38,220 * Digene Corporation 1,494,402 67 40,900 * Lincare Holdings, Inc. 1,593,464 72 36,300 Manor Care, Inc. 1,609,905 72 132,950 Medtronic, Inc. 6,747,213 304 32,000 Pharmaceutical Product Development, Inc. 1,107,520 50 73,150 Sanofi-Aventis (ADR) 3,470,968 156 163,810 Schering-Plough Corporation 3,110,752 140 40,010 * St. Jude Medical, Inc. 1,640,410 74 96,830 UnitedHealth Group, Inc. 5,408,924 243 12,330 * Vertex Pharmaceuticals, Inc. 451,155 20 34,520 * WellPoint, Inc. 2,672,884 120 - ---------------------------------------------------------------------------------------------------------------------- 45,526,239 2,048 - ---------------------------------------------------------------------------------------------------------------------- Industrials--12.0% 11,600 * American Reprographics Company 402,404 18 7,800 * Beacon Roofing Supply, Inc. 316,992 14 81,470 Boeing Company 6,348,957 286 14,100 Bucyrus International, Inc. 679,479 31 26,700 C. H. Robinson Worldwide, Inc. 1,310,703 59 23,980 * Corrections Corporation of America 1,083,896 49 47,800 Equifax, Inc. 1,780,072 80 14,900 Expeditors International of Washington, Inc. 1,287,211 58 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) ALL-CAP GROWTH FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials (continued) 19,100 Fluor Corporation $1,638,780 $74 72,940 General Dynamics Corporation 4,666,701 210 8,000 * IHS, Inc - Class A 218,800 10 7,560 * Jacobs Engineering Group, Inc. 655,754 29 21,975 * Kenexa Corporation 675,731 30 34,555 Knight Transportation, Inc. 682,461 31 24,550 * Resources Connection, Inc. 611,541 27 32,800 Robert Half International, Inc. 1,266,408 57 23,700 Rockwell Collins, Inc. 1,335,495 60 9,570 * Suntech Power Holdings Co., Ltd. 353,994 16 5,700 United Parcel Service, Inc. - Class B 452,466 20 25,830 UTI Worldwide, Inc. 816,228 37 - ---------------------------------------------------------------------------------------------------------------------- 26,584,073 1,196 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--29.4% 53,180 * Activision, Inc. 733,352 33 146,130 * Adobe Systems, Inc. 5,102,860 230 95,200 * Altera Corporation 1,964,928 88 32,640 * Apple Computer, Inc. 2,047,181 92 22,900 * Cognizant Technology Solutions Corporation - Class A 1,362,321 61 26,600 * Cognos, Inc. 1,034,740 47 123,610 * Electronic Arts, Inc. 6,763,939 304 28,800 * Equinix, Inc. 1,849,536 83 7,130 * F5 Networks, Inc. 516,854 23 59,410 * Foundry Networks, Inc. 1,078,886 48 10,500 * Google, Inc. - Class A 4,095,000 184 110,600 * HomeStore, Inc. 725,536 33 22,930 * International Rectifier Corporation 949,990 43 36,000 * Jabil Circuit, Inc. 1,542,960 69 33,100 Linear Technology Corporation 1,161,148 52 49,660 * Marvell Technology Group, Ltd. 2,686,606 121 179,480 Microsoft Corporation 4,883,651 220 19,500 MoneyGram International, Inc. 599,040 27 257,640 * Network Appliance, Inc. 9,282,769 418 26,900 * NVIDIA Corporation 1,540,294 69 91,090 * Opsware, Inc. 780,641 35 122,130 QUALCOMM, Inc. 6,180,999 278 63,990 * Red Hat, Inc. 1,790,440 81 8,800 * Redback Networks, Inc. 190,872 9 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 41,590 * SanDisk Corporation $2,392,257 $108 25,970 SAP AG (ADR) 1,410,690 63 45,390 * VeriFone Holdings, Inc. 1,374,863 62 30,200 * Zebra Technologies Corporation - Class A 1,350,544 61 - ---------------------------------------------------------------------------------------------------------------------- 65,392,897 2,942 - ---------------------------------------------------------------------------------------------------------------------- Materials--.3% 5,460 Martin Marietta Materials, Inc. 584,384 26 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--1.1% 50,700 * American Tower Corporation - Class A 1,537,224 69 3,800 * NeuStar, Inc. - Class A 117,800 5 54,020 * Syniverse Holdings, Inc. 853,516 39 - ---------------------------------------------------------------------------------------------------------------------- 2,508,540 113 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $178,062,615) 212,157,582 9,545 - ---------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT--4.2% $9,402M UBS Securities, 4.53%, dated 3/31/06, to be repurchased at $9,405,549 on 4/3/06 (collateralized by U.S. Treasury Bonds, 4.64%, 9/28/06, valued at $9,591,946) (cost $9,402,000) 9,402,000 423 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $187,464,615) 99.7% 221,559,582 9,968 Other Assets, Less Liabilities 0.3 710,062 32 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $222,269,644 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements Fund Expenses MID-CAP OPPORTUNITY FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ---------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,080.47 $7.62 Hypothetical (5% annual return before expenses) $1,000.00 $1,017.60 $7.39 - ---------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,076.75 $11.24 Hypothetical (5% annual return before expenses) $1,000.00 $1,014.11 $10.90 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.47% for Class A shares and 2.17% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived. Portfolio Composition TOP TEN SECTORS (BAR CHART DATA:) Health Care 16.9% Information Technology 15.9% Financials 14.0% Industrials 13.5% Consumer Discretionary 12.8% Energy 8.5% Consumer Staples 3.9% Other 3.8% Materials 3.6% Utilities 3.4% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments MID-CAP OPPORTUNITY FUND March 31, 2006 - -------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - -------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--98.1% Consumer Discretionary--12.9% 65,000 BorgWarner, Inc. $3,902,600 $75 70,000 * Chico's FAS, Inc. 2,844,800 55 140,000 Claire's Stores, Inc. 5,083,400 98 97,000 * Coach, Inc. 3,354,260 65 160,000 Dollar General Corporation 2,827,200 55 100,000 * Eddie Bauer Holdings, Inc. 1,290,000 25 115,000 * Helen of Troy, Ltd. 2,438,000 47 96,100 Kenneth Cole Productions, Inc. - Class "A" 2,661,970 51 120,000 Leggett & Platt, Inc. 2,924,400 57 30,000 M.D.C. Holdings, Inc. 1,929,300 37 155,000 * Morgans Hotel Group Company 2,737,300 53 150,000 Movado Group, Inc. 3,462,000 67 100,000 * Office Depot, Inc. 3,724,000 72 150,000 Orient-Express Hotels, Ltd. 5,884,500 114 157,500 * Pacific Sunwear of California, Inc. 3,490,200 68 55,000 Polo Ralph Lauren Corporation - Class "A" 3,333,550 64 260,000 * Prestige Brands Holdings, Inc. 3,164,200 61 85,000 Tiffany & Company 3,190,900 62 140,000 Tupperware Corporation 2,882,600 56 120,000 * Warnaco Group, Inc. - Class "A" 2,880,000 56 230,000 Westwood One, Inc. 2,539,200 49 - -------------------------------------------------------------------------------------------------------------------- 66,544,380 1,287 - -------------------------------------------------------------------------------------------------------------------- Consumer Staples--3.9% 62,500 Alberto-Culver Company 2,764,375 53 60,000 Altria Group, Inc. 4,251,600 82 135,000 * Constellation Brands, Inc. - Class "A" 3,381,750 65 100,000 * Dean Foods Company 3,883,000 75 132,000 * Elizabeth Arden, Inc. 3,078,240 60 100,000 Tootsie Roll Industries, Inc. 2,927,000 57 - -------------------------------------------------------------------------------------------------------------------- 20,285,965 392 - -------------------------------------------------------------------------------------------------------------------- Energy--8.5% 30,000 Anadarko Petroleum Corporation 3,030,300 59 125,000 Chesapeake Energy Corporation 3,926,250 76 50,000 EOG Resources, Inc. 3,600,000 70 55,000 GlobalSantaFe Corporation 3,341,250 65 82,500 * Grant Prideco, Inc. 3,534,300 68 100,000 Patterson-UTI Energy, Inc. 3,196,000 62 - -------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) MID-CAP OPPORTUNITY FUND March 31, 2006 - -------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - -------------------------------------------------------------------------------------------------------------------- Energy (continued) 50,000 Suncor Energy, Inc. $3,851,000 $74 70,000 * Swift Energy Company 2,622,200 51 85,000 Talisman Energy, Inc. 4,520,300 87 40,000 * Transocean, Inc. 3,212,000 62 100,000 * Weatherford International, Ltd. 4,575,000 88 110,000 XTO Energy, Inc. 4,792,700 93 - -------------------------------------------------------------------------------------------------------------------- 44,201,300 855 - -------------------------------------------------------------------------------------------------------------------- Financials--14.0% 65,000 A.G. Edwards, Inc. 3,240,900 63 37,500 Ambac Financial Group, Inc. 2,985,000 58 120,000 Aspen Insurance Holdings, Ltd. 2,959,200 57 30,000 Bear Stearns Companies, Inc. 4,161,000 80 60,000 Citigroup, Inc. 2,833,800 55 35,000 City National Corporation 2,687,650 52 135,000 Colonial BancGroup, Inc. 3,375,000 65 115,000 * Conseco, Inc. 2,854,300 55 90,000 Endurance Specialty Holdings, Ltd. 2,929,500 57 123,000 Hub International, Ltd. 3,446,460 67 175,000 Janus Capital Group, Inc. 4,054,750 78 22,500 Legg Mason, Inc. 2,819,925 55 180,000 NewAlliance Bancshares, Inc. 2,597,400 50 140,000 North Fork Bancorporation, Inc. 4,036,200 78 65,000 PMI Group, Inc. 2,984,800 58 70,000 Protective Life Corporation 3,481,800 67 150,000 Provident Financial Services, Inc. 2,715,000 53 50,000 Radian Group, Inc. 3,012,500 58 50,000 SAFECO Corporation 2,510,500 49 201,000 Sovereign Bancorp, Inc. 4,403,910 85 85,000 TD Banknorth, Inc. 2,494,750 48 135,000 Waddell & Reed Financial, Inc. - Class "A" 3,118,500 60 35,000 Zions Bancorporation 2,895,550 56 - -------------------------------------------------------------------------------------------------------------------- 72,598,395 1,404 - -------------------------------------------------------------------------------------------------------------------- Health Care--16.9% 100,000 Aetna, Inc. 4,914,000 95 135,000 * Aspreva Pharmaceuticals Corporation 3,360,150 65 47,500 Beckman Coulter, Inc. 2,592,075 50 82,500 Biomet, Inc. 2,930,400 57 110,000 * Caremark Rx, Inc. 5,409,800 105 - -------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - -------------------------------------------------------------------------------------------------------------------- Health Care (continued) 54,000 * Charles River Laboratories International, Inc. $2,647,080 $51 75,000 * Community Health Systems, Inc. 2,711,250 52 50,500 DENTSPLY International, Inc. 2,936,575 57 300,000 * Exelixis, Inc. 3,603,000 70 55,000 * Fisher Scientific International, Inc. 3,742,750 72 66,000 * Gilead Sciences, Inc. 4,106,520 79 85,000 * Henry Schein, Inc. 4,068,100 79 265,000 * Human Genome Sciences, Inc. 2,880,550 56 160,000 * Idenix Pharmaceuticals, Inc. 2,171,200 42 52,500 * Laboratory Corporation of America Holdings 3,070,200 59 65,000 * Medco Health Solutions, Inc. 3,719,300 72 120,000 Medicis Pharmaceutical Corporation - Class "A" 3,912,000 76 66,000 * Neurocrine Biosciences, Inc. 4,259,640 82 160,000 * Noven Pharmaceuticals, Inc. 2,881,600 56 200,000 Option Care, Inc. 2,828,000 55 130,000 * Thermo Electron Corporation 4,821,700 93 68,500 * Triad Hospitals, Inc. 2,870,150 55 175,000 * TriZetto Group, Inc. 3,078,250 60 75,000 * Waters Corporation 3,236,250 63 60,000 * WellPoint, Inc. 4,645,800 90 - -------------------------------------------------------------------------------------------------------------------- 87,396,340 1,691 - -------------------------------------------------------------------------------------------------------------------- Industrials--13.5% 80,000 American Standard Companies, Inc. 3,428,800 66 45,000 Avery Dennison Corporation 2,631,600 51 75,000 Briggs & Stratton Corporation 2,652,750 51 160,000 Chicago Bridge & Iron Company NV - NY Shares 3,840,000 74 65,000 * ChoicePoint, Inc. 2,908,750 56 41,000 FedEx Corporation 4,630,540 90 95,000 * Gardner Denver, Inc. 6,194,000 120 50,000 Harsco Corporation 4,131,000 80 65,000 IDEX Corporation 3,391,050 66 205,000 * K&F Industries Holdings, Inc. 3,403,000 66 186,500 Knoll, Inc. 3,976,180 77 47,500 L-3 Communications Holdings, Inc. 4,075,025 79 67,000 Manpower, Inc. 3,831,060 74 90,000 Masco Corporation 2,924,100 56 111,000 * Mobile Mini, Inc. 3,432,120 66 75,000 Northrop Grumman Corporation 5,121,750 99 95,000 Regal-Beloit Corporation 4,015,650 78 - -------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) MID-CAP OPPORTUNITY FUND March 31, 2006 - -------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - -------------------------------------------------------------------------------------------------------------------- Industrials (continued) 62,000 Rolls-Royce Group PLC (ADR) $2,462,708 $48 115,000 * Williams Scotsman International, Inc. 2,880,750 56 - -------------------------------------------------------------------------------------------------------------------- 69,930,833 1,353 - -------------------------------------------------------------------------------------------------------------------- Information Technology--15.9% 475,000 * Adaptec, Inc. 2,626,750 51 115,000 Amphenol Corporation - Class "A" 6,000,700 116 100,000 * Avocent Corporation 3,174,000 61 125,000 * Comverse Technology, Inc. 2,941,250 57 55,000 * DST Systems, Inc. 3,186,700 62 130,000 * Electronics for Imaging, Inc. 3,636,100 70 71,250 Fair Isaac Corporation 2,822,925 55 180,000 * Genesis Microchip, Inc. 3,067,200 59 220,000 * Ingram Micro, Inc. - Class "A" 4,400,000 85 90,000 * International Rectifier Corporation 3,728,700 72 115,000 Intersil Corporation - Class "A" 3,325,800 64 55,000 * Intuit, Inc. 2,925,450 57 140,000 * Manhattan Associates, Inc. 3,080,000 60 90,000 Maxim Integrated Products, Inc. 3,343,500 65 110,000 * McAfee, Inc. 2,676,300 52 85,000 * Novellus Systems, Inc. 2,040,000 39 190,000 * Palm, Inc. 4,400,400 85 160,000 * Paxar Corporation 3,131,200 61 215,000 * Polycom, Inc. 4,661,200 90 77,700 * Silicon Image, Inc. 801,087 15 375,000 * Smart Modular Technologies (WWH), Inc. 3,393,750 66 165,000 * Sybase, Inc. 3,484,800 67 230,000 * Tekelec 3,180,900 62 97,500 * Varian Semiconductor Equipment Associates, Inc. 2,737,800 53 140,000 * VeriSign, Inc. 3,358,600 65 - -------------------------------------------------------------------------------------------------------------------- 82,125,112 1,589 - -------------------------------------------------------------------------------------------------------------------- Materials--3.6% 80,000 Freeport-McMoRan Copper & Gold, Inc. - Class "B" 4,781,600 93 110,000 Louisiana-Pacific Corporation 2,992,000 58 80,000 Lubrizol Corporation 3,428,000 66 65,000 Praxair, Inc. 3,584,750 69 250,000 Sappi, Ltd. (ADR) 3,687,500 71 - -------------------------------------------------------------------------------------------------------------------- 18,473,850 357 - -------------------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - -------------------------------------------------------------------------------------------------------------------- Other--3.8% 45,000 iShares Russell Midcap Index Fund $4,260,150 $83 105,000 MidCap SPDR Trust - Series "1" 15,209,250 294 - -------------------------------------------------------------------------------------------------------------------- 19,469,400 377 - -------------------------------------------------------------------------------------------------------------------- Telecommunication Services--1.7% 225,000 Citizens Communications Company 2,985,750 58 100,000 Commonwealth Telephone Enterprises, Inc. 3,445,000 66 158,000 * NTELOS Holdings Corporation 2,213,580 43 - -------------------------------------------------------------------------------------------------------------------- 8,644,330 167 - -------------------------------------------------------------------------------------------------------------------- Utilities--3.4% 100,000 AGL Resources, Inc. 3,605,000 70 65,000 Consolidated Edison, Inc. 2,827,500 55 105,000 Equitable Resources, Inc. 3,833,550 74 90,000 SCANA Corporation 3,531,600 68 90,000 Wisconsin Energy Corporation 3,599,100 69 - -------------------------------------------------------------------------------------------------------------------- 17,396,750 336 - -------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $377,577,623) 507,066,655 9,808 - -------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--2.1% $4,000M Chevron Texaco Funding Corp., 4.71%, 4/13/06 3,993,718 77 2,800M General Electric Capital Corp., 4.60%, 4/5/06 2,798,567 54 4,100M Toyota Motor Credit Corp., 4.75%, 4/6/06 4,097,294 80 - -------------------------------------------------------------------------------------------------------------------- Total Value of Short-Term Corporate Notes (cost $10,889,579) 10,889,579 211 - -------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $388,467,202) 100.2% 517,956,234 10,019 Excess of Liabilities Over Other Assets (.2) (985,027) (19) - -------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $516,971,207 $10,000 ==================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements Fund Expenses SPECIAL SITUATIONS FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ---------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,113.51 $8.27 Hypothetical (5% annual return before expenses) $1,000.00 $1,017.10 $7.90 - ---------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,109.51 $11.94 Hypothetical (5% annual return before expenses) $1,000.00 $1,013.61 $11.40 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.57% for Class A shares and 2.27% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived. Portfolio Composition TOP TEN SECTORS (BAR CHART DATA:) Industrials 22.8% Information Technology 21.3% Consumer Discretionary 11.5% Consumer Staples 8.9% Health Care 8.8% Materials 6.9% Utilities 5.0% Energy 4.7% Telecommunication Services 4.2% Financials 3.9% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments SPECIAL SITUATIONS FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--97.8% Consumer Discretionary--11.5% 156,200 Catalina Marketing Corporation $3,608,220 $134 134,500 Dillard's, Inc. - Class "A" 3,502,380 130 107,800 Jackson Hewitt Tax Service, Inc. 3,404,324 126 271,700 Journal Communications, Inc. 3,369,080 125 71,325 Media General, Inc. - Class "A" 3,325,172 123 175,500 * Payless ShoeSource, Inc. 4,017,195 149 166,600 RadioShack Corporation 3,203,718 119 101,500 * Scholastic Corporation 2,716,140 100 266,400 * Tempur-Pedic International, Inc. 3,769,560 139 - ---------------------------------------------------------------------------------------------------------------------- 30,915,789 1,145 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--8.9% 204,700 Chiquita Brands International, Inc. 3,432,819 127 112,950 Church & Dwight Co., Inc. 4,170,114 155 162,900 Flower Foods, Inc. 4,838,130 179 117,600 Hormel Foods Corporation 3,974,880 147 89,300 Lancaster Colony Corporation 3,750,600 139 129,954 Tootsie Roll Industries, Inc. 3,803,753 141 - ---------------------------------------------------------------------------------------------------------------------- 23,970,296 888 - ---------------------------------------------------------------------------------------------------------------------- Energy--4.7% 145,700 * Denbury Resources, Inc. 4,614,319 171 209,300 * Parker Drilling Company 1,940,211 72 54,900 * Swift Energy Company 2,056,554 76 61,000 Tesoro Corporation 4,168,740 155 - ---------------------------------------------------------------------------------------------------------------------- 12,779,824 474 - ---------------------------------------------------------------------------------------------------------------------- Financials--3.9% 104,900 Calamos Asset Management, Inc. - Class "A" 3,923,260 145 64,200 Commerce Bancorp, Inc. 2,352,930 87 118,250 HCC Insurance Holdings, Inc. 4,115,100 153 - ---------------------------------------------------------------------------------------------------------------------- 10,391,290 385 - ---------------------------------------------------------------------------------------------------------------------- Health Care--8.8% 193,500 * AMN Healthcare Services, Inc. 3,622,320 134 142,100 * AmSurg Corporation 3,224,249 120 420,700 * BioScrip, Inc. 3,033,247 112 76,600 * Humana, Inc. 4,032,990 149 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) SPECIAL SITUATIONS FUND March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Health Care (continued) 60,600 * Lincare Holdings, Inc. $2,360,976 $88 102,200 * Magellan Health Services, Inc. 4,136,034 153 95,300 West Pharmaceutical Services, Inc. 3,308,816 123 - ---------------------------------------------------------------------------------------------------------------------- 23,718,632 879 - ---------------------------------------------------------------------------------------------------------------------- Industrials--22.7% 107,900 * Aviall, Inc. 4,108,832 152 60,000 Carlisle Companies, Inc. 4,908,000 182 115,200 CLARCOR, Inc. 4,101,120 152 57,400 Curtiss-Wright Corporation 3,799,880 141 70,000 HNI Corporation 4,130,000 153 58,800 * Jacobs Engineering Group, Inc. 5,100,312 189 86,200 John H. Harland Company 3,387,660 126 134,600 * Kansas City Southern, Inc. 3,324,620 123 88,200 * NCI Building Systems, Inc. 5,271,714 195 158,700 Stewart & Stevenson Services, Inc. 5,789,376 214 73,900 United Industrial Corporation 4,502,727 167 112,300 Wabtec Corporation 3,660,980 136 135,825 Watson Wyatt & Company Holdings - Class "A" 4,425,179 164 144,000 Woodward Governor Company 4,788,000 177 - ---------------------------------------------------------------------------------------------------------------------- 61,298,400 2,271 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--21.2% 161,650 * Avnet, Inc. 4,102,677 152 232,900 AVX Corporation 4,122,330 153 119,900 * Cabot Microelectronics Corporation 4,448,290 165 142,700 * Checkpoint Systems, Inc. 3,835,776 142 267,900 * Convergys Corporation 4,878,459 181 51,400 Imation Corporation 2,205,574 82 104,100 * Intergraph Corporation 4,336,806 161 124,900 * MEMC Electronic Materials, Inc. 4,611,308 171 177,200 MoneyGram International, Inc. 5,443,584 202 371,250 * Overland Storage, Inc. 3,370,950 125 82,000 * Rogers Corporation 4,467,360 164 190,425 Sabre Holdings Corporation - Class "A" 4,480,700 166 379,400 * Tyler Technologies, Inc. 4,173,400 155 101,400 * Varian Semiconductor Equipment Associates, Inc. 2,847,312 105 - ---------------------------------------------------------------------------------------------------------------------- 57,324,526 2,124 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Materials--6.9% 70,200 AptarGroup, Inc. $3,878,550 $144 126,800 Bowater, Inc. 3,750,744 139 98,500 Commercial Metals Company 5,268,765 195 89,400 Eagle Materials, Inc. 5,700,144 211 - ---------------------------------------------------------------------------------------------------------------------- 18,598,203 689 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--4.2% 105,300 CenturyTel, Inc. 4,119,336 152 399,200 * Premiere Global Services, Inc. 3,213,560 119 107,775 Telephone & Data Systems, Inc. - Special Shares 4,068,506 151 - ---------------------------------------------------------------------------------------------------------------------- 11,401,402 422 - ---------------------------------------------------------------------------------------------------------------------- Utilities--5.0% 124,500 Atmos Energy Corporation 3,278,085 121 261,800 * CMS Energy Corporation 3,390,310 126 191,500 Duquesne Light Holdings, Inc. 3,159,750 117 160,100 Pepco Holdings, Inc. 3,648,679 135 - ---------------------------------------------------------------------------------------------------------------------- 13,476,824 499 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $218,723,047) 263,875,186 9,776 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--2.0% $5,500M Federal Home Loan Bank, 4.63%, 4/3/06 (cost $5,498,585) 5,498,585 204 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $224,221,632) 99.8% 269,373,771 9,980 Other Assets, Less Liabilities .2 529,414 20 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $269,903,185 $10,000 ====================================================================================================================== * Non-income producing See notes to financial statements Fund Expenses FOCUSED EQUITY FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - -------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,042.63 $9.62 Hypothetical (5% annual return before expenses) $1,000.00 $1,015.51 $9.50 - -------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,038.42 $13.16 Hypothetical (5% annual return before expenses) $1,000.00 $1,012.02 $12.99 - -------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.89% for Class A shares and 2.59% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Portfolio Composition BY SECTOR (BAR CHART DATA:) Information Technology 20.0% Financials 18.2% Health Care 16.7% Industrials 12.6% Consumer Discretionary 9.1% Consumer Staples 8.8% Energy 8.8% Telecommunication Services 2.9% Materials 1.1% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments FOCUSED EQUITY FUND March 31, 2006 - --------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - --------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--98.9% Consumer Discretionary--9.2% 32,100 CBS Corporation - Class "B" $769,758 $136 12,800 Federated Department Stores, Inc. 934,400 166 14,600 Lowe's Companies, Inc. 940,824 167 6,600 NIKE, Inc. - Class "B" 561,660 99 66,800 Time Warner, Inc. 1,121,572 199 21,750 * Viacom, Inc. - Class "B" 843,900 150 - --------------------------------------------------------------------------------------------------------------------- 5,172,114 917 - --------------------------------------------------------------------------------------------------------------------- Consumer Staples--8.9% 22,300 Altria Group, Inc. 1,580,178 280 25,500 PepsiCo, Inc. 1,473,645 261 34,100 Procter & Gamble Company 1,964,842 349 - --------------------------------------------------------------------------------------------------------------------- 5,018,665 890 - --------------------------------------------------------------------------------------------------------------------- Energy--8.8% 35,100 ConocoPhillips 2,216,565 393 9,200 GlobalSantaFe Corporation 558,900 99 14,300 Noble Energy, Inc. 628,056 112 12,400 Schlumberger, Ltd. 1,569,468 278 - --------------------------------------------------------------------------------------------------------------------- 4,972,989 882 - --------------------------------------------------------------------------------------------------------------------- Financials--18.3% 21,100 ACE, Ltd. 1,097,411 195 14,520 American International Group, Inc. 959,627 170 49,300 Bank of America Corporation 2,245,122 398 35,800 Citigroup, Inc. 1,690,834 300 13,700 Golden West Financial Corporation 930,230 165 17,600 Merrill Lynch & Company, Inc. 1,386,176 246 17,000 State Street Corporation 1,027,310 182 9,100 UBS AG 1,000,727 177 - --------------------------------------------------------------------------------------------------------------------- 10,337,437 1,833 - --------------------------------------------------------------------------------------------------------------------- Health Care--16.8% 18,100 Abbott Laboratories 768,707 136 21,500 * Amgen, Inc. 1,564,125 277 17,800 Eli Lilly & Company 984,340 175 5,800 * Genzyme Corporation 389,876 69 - --------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FOCUSED EQUITY FUND March 31, 2006 - --------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - --------------------------------------------------------------------------------------------------------------------- Health Care (continued) 33,500 Medtronic, Inc. $1,700,125 $302 28,900 Sanofi-Aventis (ADR) 1,371,305 243 59,800 Schering-Plough Corporation 1,135,602 201 20,000 * WellPoint, Inc. 1,548,600 275 - --------------------------------------------------------------------------------------------------------------------- 9,462,680 1,678 - --------------------------------------------------------------------------------------------------------------------- Industrials--12.7% 12,200 Boeing Company 950,746 168 7,200 Caterpillar, Inc. 517,032 92 56,300 General Electric Company 1,958,114 347 13,300 Lockheed Martin Corporation 999,229 177 17,700 Textron, Inc. 1,653,003 293 31,100 Waste Management, Inc. 1,097,830 195 - --------------------------------------------------------------------------------------------------------------------- 7,175,954 1,272 - --------------------------------------------------------------------------------------------------------------------- Information Technology--20.2% 22,500 Analog Devices, Inc. 861,525 153 19,500 Automatic Data Processing, Inc. 890,760 158 56,300 * Cisco Systems, Inc. 1,220,021 216 50,700 * Corning, Inc. 1,364,337 242 19,400 * Dell, Inc. 577,344 102 65,200 * EMC Corporation 888,676 158 24,800 First Data Corporation 1,161,136 206 3,900 * Google, Inc. - Class "A" 1,521,000 270 106,200 Microsoft Corporation 2,889,702 512 - --------------------------------------------------------------------------------------------------------------------- 11,374,501 2,017 - --------------------------------------------------------------------------------------------------------------------- Materials--1.1% 2,900 Rio Tinto PLC (ADR) 600,300 107 - --------------------------------------------------------------------------------------------------------------------- Telecommunication Services--2.9% 63,121 Sprint Nextel Corporation 1,631,046 289 - --------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $48,290,968) 55,745,686 9,885 - --------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT--1.8% $1,030M UBS Securities, 4.53%, dated 3/31/06, to be repurchased at $1,030,389 on 4/3/06 (collateralized by U.S. Treasury Bonds, 6.625%, 2/15/27, valued at $1,051,205) (cost $1,030,000) $1,030,000 $182 - --------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $49,320,968) 100.7% 56,775,686 10,067 Excess of Liabilities Over Other Assets (.7) (376,789) (67) - --------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $56,398,897 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements Fund Expenses GLOBAL FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing these costs with costs of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples. - ----------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period (10/1/05) (3/31/06) (10/1/05-3/31/06)* - ----------------------------------------------------------------------------------------------- Expense Example - Class A Shares Actual $1,000.00 $1,077.35 $9.53 Hypothetical (5% annual return before expenses) $1,000.00 $1,015.76 $9.25 - ----------------------------------------------------------------------------------------------- Expense Example - Class B Shares Actual $1,000.00 $1,073.62 $13.13 Hypothetical (5% annual return before expenses) $1,000.00 $1,012.26 $12.74 - ----------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.84% for Class A shares and 2.54% for Class B shares, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). Portfolio Composition TOP TEN COUNTRIES (BAR CHART DATA:) United States 46.0% Japan 10.8% Switzerland 7.2% France 7.2% United Kingdom 6.9% Canada 3.8% Italy 2.7% Germany 2.5% Spain 1.8% Netherlands 1.7% Portfolio holdings and allocations are subject to change. Percentages are as of March 31, 2006, and are based on the total market value of investments. Portfolio of Investments GLOBAL FUND March 31, 2006 - --------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - --------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--97.6% United States--46.0% 29,800 Abbott Laboratories $1,265,606 $47 13,300 Abercrombie & Fitch Company - Class "A" 775,390 29 36,800 ACE, Ltd. 1,913,968 71 60,500 * Adobe Systems, Inc. 2,112,660 78 19,700 * Alkermes, Inc. 434,385 16 37,000 Altria Group, Inc. 2,621,820 97 42,500 * Amdocs, Ltd. 1,532,550 56 24,153 American International Group, Inc. 1,596,272 59 35,800 * Amgen, Inc. 2,604,450 96 37,100 Analog Devices, Inc. 1,420,559 52 79,300 Bank of America Corporation 3,611,322 133 20,800 Boeing Company 1,620,944 60 11,800 Caterpillar, Inc. 847,358 31 87,300 CBS Corporation - Class "B" 2,093,454 77 19,700 Chubb Corporation 1,880,168 69 92,800 * Cisco Systems, Inc. 2,010,976 74 59,049 Citigroup, Inc. 2,788,884 103 14,600 CNF, Inc. 729,124 27 39,400 ConocoPhillips 2,488,110 92 114,000 * Corning, Inc. 3,067,740 113 32,100 * Dell, Inc. 955,296 35 57,500 * E*TRADE Financial Corporation 1,551,350 57 34,300 Eli Lilly & Company 1,896,790 70 107,400 * EMC Corporation 1,463,862 54 43,500 ExxonMobil Corporation 2,647,410 98 31,700 Federated Department Stores, Inc. 2,314,100 85 34,300 First Data Corporation 1,605,926 59 31,400 * Fisher Scientific International, Inc. 2,136,770 79 22,600 Fluor Corporation 1,939,080 71 93,400 General Electric Company 3,248,452 120 24,300 * Genzyme Corporation 1,633,446 60 15,000 GlobalSantaFe Corporation 911,250 34 24,100 Golden West Financial Corporation 1,636,390 60 5,800 * Google, Inc. - Class "A" 2,262,000 83 17,300 * Health Net, Inc. 879,186 32 24,100 Lockheed Martin Corporation 1,810,633 67 24,900 Loews Corporation - Carolina Group 1,177,023 43 24,900 Lowe's Companies, Inc. 1,604,556 59 29,900 Market 2000+ Holders Trust 1,648,088 61 - --------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) GLOBAL FUND March 31, 2006 - --------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - --------------------------------------------------------------------------------------------------------------------- United States (continued) 12,900 Martin Marietta Materials, Inc. $1,380,687 $51 16,900 * MedImmune, Inc. 618,202 23 55,600 Medtronic, Inc. 2,821,700 104 29,100 Merrill Lynch & Company, Inc. 2,291,916 84 34,400 Michaels Stores, Inc. 1,292,752 48 31,600 Microchip Technology, Inc. 1,147,080 42 172,400 Microsoft Corporation 4,691,004 173 15,100 * National-Oilwell Varco, Inc. 968,212 36 30,700 Newmont Mining Corporation 1,593,023 59 46,000 Noble Energy, Inc. 2,020,320 74 18,400 Nuveen Investments - Class "A" 885,960 33 20,200 * Penn National Gaming, Inc. 852,036 31 40,600 PepsiCo, Inc. 2,346,274 86 7,200 Precision Castparts Corporation 427,680 16 56,300 Procter & Gamble Company 3,244,006 120 22,300 QUALCOMM, Inc. 1,128,603 42 111,500 Schering-Plough Corporation 2,117,385 78 16,500 Schlumberger, Ltd. 2,088,405 77 29,600 Simon Property Group, Inc. (REIT) 2,490,544 92 109,579 Sprint Nextel Corporation 2,831,521 104 28,100 State Street Corporation 1,698,083 63 35,800 Textron, Inc. 3,343,362 123 121,200 Time Warner, Inc. 2,034,948 75 34,600 United Technologies Corporation 2,005,762 74 24,300 * Univision Communications, Inc. - Class "A" 837,621 31 25,500 * Viacom, Inc. - Class "B" 989,400 36 86,400 Waste Management, Inc. 3,049,920 112 36,200 * WellPoint, Inc. 2,802,966 103 - --------------------------------------------------------------------------------------------------------------------- 124,736,720 4,597 - --------------------------------------------------------------------------------------------------------------------- Japan--10.7% 37,100 Canon, Inc. 2,449,436 90 6,700 Credit Saison Company, Ltd. 369,667 14 81,300 Daiichi Sankyo Company, Ltd. 1,850,076 68 52,800 Eisai Company, Ltd. 2,295,652 85 104,400 Matsui Securities Company, Ltd. 1,444,027 53 15,000 Mitsubishi Estate Company, Ltd. 354,691 13 612,000 Mitsubishi Heavy Industries, Ltd. 2,904,653 107 320 Mitsubishi Tokyo Financial Group, Inc. 4,876,888 180 447 Nippon Telegraph & Telephone Corporation 1,913,171 71 - --------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - --------------------------------------------------------------------------------------------------------------------- Japan (continued) 298,000 Obayashi Corporation $2,419,561 $89 35,650 Promise Company, Ltd. 2,151,267 79 68,300 Seven & I Holdings Company, Ltd. 2,697,500 99 219,000 Shinsei Bank, Ltd. 1,529,418 56 33,200 Sony Corporation 1,533,520 57 5,660 Takefuji Corporation 355,459 13 - --------------------------------------------------------------------------------------------------------------------- 29,144,986 1,074 - --------------------------------------------------------------------------------------------------------------------- Switzerland--7.2% 56,804 Credit Suisse Group - Registered 3,179,564 117 20,973 Nestle SA - Registered 6,210,775 229 11,200 UBS AG - Registered 1,231,664 46 64,100 UBS AG - Registered 7,023,851 259 8,227 * Zurich Financial Services AG - Registered 1,927,933 71 - --------------------------------------------------------------------------------------------------------------------- 19,573,787 722 - --------------------------------------------------------------------------------------------------------------------- France--7.2% 49,307 * Electricite de France 2,792,516 103 27,699 Essilor International SA 2,467,079 91 27,069 Lafarge SA 3,062,845 113 26,746 LVMH Moet Hennessy Louis Vuitton SA 2,618,476 97 42,287 PSA Peugeot Citroen 2,661,040 98 39,253 Sanofi-Aventis 3,728,926 137 8,072 Total SA 2,126,576 78 - --------------------------------------------------------------------------------------------------------------------- 19,457,458 717 - --------------------------------------------------------------------------------------------------------------------- United Kingdom--6.9% 68,751 AstraZeneca PLC 3,458,300 127 345,254 EMI Group PLC 1,515,112 56 80,237 Imperial Tobacco Group PLC 2,375,712 88 167,710 Kingfisher PLC 696,707 26 116,600 London Stock Exchange PLC 2,135,739 79 740,442 Old Mutual PLC 2,584,714 95 83,802 Reckitt Benckiser PLC 2,944,960 108 91,789 Xstrata PLC 2,966,123 109 - --------------------------------------------------------------------------------------------------------------------- 18,677,367 688 - --------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) GLOBAL FUND March 31, 2006 - --------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - --------------------------------------------------------------------------------------------------------------------- Canada--3.8% 61,700 Alcan, Inc. $2,825,845 $104 33,300 Cameco Corporation 1,198,800 44 34,100 EnCana Corporation 1,595,387 59 14,700 Inco, Ltd. 733,383 27 43,900 Inco, Ltd. 2,186,345 81 34,100 Talisman Energy, Inc. 1,811,106 67 - --------------------------------------------------------------------------------------------------------------------- 10,350,866 382 - --------------------------------------------------------------------------------------------------------------------- Italy--2.7% 609,042 Banca Intesa SpA 3,633,586 134 510,761 UniCredito Italiano SpA 3,686,968 136 - --------------------------------------------------------------------------------------------------------------------- 7,320,554 270 - --------------------------------------------------------------------------------------------------------------------- Germany--2.5% 24,530 E.ON AG 2,696,893 99 9,694 Muenchener Rueckversicherungs - Gesellschaft AG - Registered 1,373,729 51 12,397 SAP AG 2,689,912 99 - --------------------------------------------------------------------------------------------------------------------- 6,760,534 249 - --------------------------------------------------------------------------------------------------------------------- Spain--1.8% 229,416 Banco Bilbao Vizcaya Argentaria SA 4,780,772 176 - --------------------------------------------------------------------------------------------------------------------- Netherlands--1.7% 48,614 ABN AMRO Holding NV 1,455,467 54 94,844 Koninklijke (Royal) Philips Electronics NV 3,201,103 118 - --------------------------------------------------------------------------------------------------------------------- 4,656,570 172 - --------------------------------------------------------------------------------------------------------------------- Norway--1.6% 155,450 Statoil ASA 4,476,721 165 - --------------------------------------------------------------------------------------------------------------------- Finland--1.1% 141,550 Nokia OYJ 2,925,762 108 - --------------------------------------------------------------------------------------------------------------------- Brazil--.9% 52,100 Companhia Vale Do Rio Doce (ADR) 2,528,413 93 - --------------------------------------------------------------------------------------------------------------------- Taiwan--.8% 111,600 Chunghwa Telecom Company, Ltd. (ADR) 2,186,243 81 - --------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - --------------------------------------------------------------------------------------------------------------------- Ireland--.8% 38,500 * Ryanair Holdings PLC (ADR) $2,105,950 $78 - --------------------------------------------------------------------------------------------------------------------- Mexico--.7% 29,600 America Movil SA de CV (ADR) - Series "L" 1,014,096 37 311,200 Wal-Mart de Mexico SA de CV 832,762 31 - --------------------------------------------------------------------------------------------------------------------- 1,846,858 68 - --------------------------------------------------------------------------------------------------------------------- Russia--.6% 52,800 Mobile TeleSystems (ADR) 1,747,680 64 - --------------------------------------------------------------------------------------------------------------------- Australia--.6% 118,512 Santos, Ltd. 961,664 35 19,200 Woodside Petroleum, Ltd. (ADR) 622,644 23 - --------------------------------------------------------------------------------------------------------------------- 1,584,308 58 - --------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $219,383,889) 264,861,549 9,762 - --------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT--2.3% $6,115M UBS Securities, 4.53%, dated 3/31/06, to be repurchased at $6,117,308 on 4/3/06 (collateralized by U.S. Treasury Bonds, 4.64%, 9/28/06, valued at $6,239,013) (cost $6,115,000) 6,115,000 225 - --------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $225,498,889) 99.9% 270,976,549 9,987 Other Assets, Less Liabilities .1 349,352 13 - --------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $271,325,901 $10,000 ===================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts REIT Real Estate Investment Trust See notes to financial statements Portfolio of Investments (continued) GLOBAL FUND March 31, 2006 Sector diversification of the portfolio was as follows: - ------------------------------------------------------------------------------ Percentage Sector of Net Assets Value - ------------------------------------------------------------------------------ Diversified Financials 10.0% $27,107,431 Banks 9.3 25,210,811 Energy 8.8 23,916,605 Pharmaceuticals & Biotechnology 8.1 21,903,218 Capital Goods 7.6 20,567,485 Materials 6.4 17,276,664 Software & Services 5.5 14,894,052 Food, Beverage & Tobacco 5.4 14,731,604 Technology Hardware & Equipment 5.2 14,001,675 Insurance 4.2 11,276,784 Health Care Equipment & Services 4.1 11,107,701 Telecommunication Services 3.6 9,692,712 Media 2.7 7,470,535 Consumer Durables & Apparel 2.7 7,353,099 Retailing 2.5 6,683,505 Household & Personal Products 2.3 6,188,966 Utilities 2.0 5,489,409 Food & Staples Retailing 1.3 3,530,261 Commercial Services & Supplies 1.1 3,049,920 Real Estate 1.0 2,845,235 Transportation 1.0 2,835,074 Automobiles & Components 1.0 2,661,040 Semiconductors & Semiconductor Equipment 0.9 2,567,639 Pooled Vehicle 0.6 1,648,088 Consumer Services 0.3 852,036 Repurchase Agreement 2.3 6,115,000 - ------------------------------------------------------------------------------ Total Value of Investments 99.9 270,976,549 Other Assets, Less Liabilities .1 349,352 - ------------------------------------------------------------------------------ Net Assets 100.0% $271,325,901 ============================================================================== See notes to financial statements This page intentionally left blank. Statements of Assets and Liabilities FIRST INVESTORS EQUITY FUNDS March 31, 2006 - ---------------------------------------------------------------------------------------------------------------------------- TOTAL GROWTH & ALL-CAP RETURN VALUE BLUE CHIP INCOME GROWTH - ---------------------------------------------------------------------------------------------------------------------------- Assets Investments in securities: At identified cost $297,577,768 $265,903,453 $362,466,420 $586,234,175 $187,464,615 ============ ============ ============ ============ ============ At value (Note 1A) $342,961,021 $335,253,709 $488,049,835 $747,101,009 $221,559,582 Cash (overdraft) 871,559 (353,096) 10,080 674,821 2,347 Receivables: Investment securities sold 852,848 869,391 937,949 2,903,645 1,417,866 Dividends and interest 1,446,083 593,963 625,343 770,879 56,557 Shares sold 635,050 894,171 727,150 1,646,085 599,474 Forward currency contracts (Note 4) -- -- -- -- 46 Other assets 46,643 42,327 82,725 97,293 28,882 ------------ ------------ ------------ ------------ ------------ Total Assets 346,813,204 337,300,465 490,433,082 753,193,732 223,664,754 ------------ ------------ ------------ ------------ ------------ Liabilities Payables: Investment securities purchased 2,476,074 1,532,068 1,226,159 3,291,137 695,670 Shares redeemed 699,187 627,920 1,196,160 1,575,136 466,696 Dividends payable 17,724 15,754 2,522 5,110 -- Accrued advisory fees 215,700 209,832 306,314 452,762 139,334 Accrued shareholder servicing costs 79,100 80,034 136,542 174,352 68,506 Accrued expenses 29,587 18,253 12,356 30,744 24,904 ------------ ------------ ------------ ------------ ------------ Total Liabilities 3,517,372 2,483,861 2,880,053 5,529,241 1,395,110 ------------ ------------ ------------ ------------ ------------ Net Assets $343,295,832 $334,816,604 $487,553,029 $747,664,491 $222,269,644 ============ ============ ============ ============ ============ Net Assets Consist of: Capital paid in $303,110,443 $307,031,235 $465,941,090 $599,044,423 $176,820,079 Undistributed net investment income (loss) (268,576) 754,173 375,571 637,164 (854,534) Accumulated net realized gain (loss) on investments and foreign currency transactions (4,929,288) (42,319,060) (104,347,047) (12,883,930) 12,209,132 Net unrealized appreciation in value of investments and foreign currency transactions 45,383,253 69,350,256 125,583,415 160,866,834 34,094,967 ------------ ------------ ------------ ------------ ------------ Total $343,295,832 $334,816,604 $487,553,029 $747,664,491 $222,269,644 ============ ============ ============ ============ ============ Net Assets: Class A $305,326,202 $306,247,041 $437,648,885 $664,981,934 $197,035,808 Class B $37,969,630 $28,569,563 $49,904,144 $82,682,557 $25,233,836 Shares outstanding (Note 5): Class A 20,917,822 42,928,076 20,096,337 44,799,919 20,488,667 Class B 2,639,564 4,067,458 2,451,229 5,841,717 2,724,781 Net asset value and redemption price per share -- Class A $14.60 $7.13 $21.78 $14.84 $9.62 ============ ============ ============ ============ ============ Maximum offering price per share -- Class A (Net asset value/.9425)* $15.49 $7.56 $23.11 $15.75 $10.21 ============ ============ ============ ============ ============ Net asset value and offering price per share -- Class B (Note 5) $14.38 $7.02 $20.36 $14.15 $9.26 ============ ============ ============ ============ ============ Statements of Assets and Liabilities (continued) FIRST INVESTORS EQUITY FUNDS March 31, 2006 - ------------------------------------------------------------------------------------------------------------ MID-CAP SPECIAL FOCUSED OPPORTUNITY SITUATIONS EQUITY GLOBAL - ------------------------------------------------------------------------------------------------------------ Assets Investments in securities: At identified cost $388,467,202 $224,221,632 $49,320,968 $225,498,889 ============ ============ ============ ============ At value (Note 1A) $517,956,234 $269,373,771 $56,775,686 $270,976,549 Cash (overdraft) 210,857 147,084 6,191 64,627 Receivables: Investment securities sold 253,492 1,272,476 43,353 1,444,472 Dividends and interest 270,440 136,200 79,615 510,487 Shares sold 1,387,204 645,473 37,138 487,701 Forward currency contracts (Note 4) -- -- -- 5,437 Other assets 66,597 36,357 8,887 57,450 ------------ ------------ ------------ ------------ Total Assets 520,144,824 271,611,361 56,950,870 273,546,723 ------------ ------------ ------------ ------------ Liabilities Payables: Investment securities purchased 1,595,525 917,880 293,720 1,608,768 Shares redeemed 1,090,872 517,726 181,653 305,559 Dividends payable -- -- -- -- Accrued advisory fees 318,942 167,234 36,167 222,752 Accrued shareholder servicing costs 133,506 79,008 25,781 68,786 Accrued expenses 34,772 26,328 14,652 14,957 ------------ ------------ ------------ ------------ Total Liabilities 3,173,617 1,708,176 551,973 2,220,822 ------------ ------------ ------------ ------------ Net Assets $516,971,207 $269,903,185 $56,398,897 $271,325,901 ============ ============ ============ ============ Net Assets Consist of: Capital paid in $365,339,587 $223,623,093 $72,071,282 $215,053,462 Undistributed net investment income (loss) (1,289,234) (580,778) (124,263) (1,077,570) Accumulated net realized gain (loss) on investments and foreign currency transactions 23,431,822 1,708,731 (23,002,840) 11,869,744 Net unrealized appreciation in value of investments and foreign currency transactions 129,489,032 45,152,139 7,454,718 45,480,265 ------------ ------------ ------------ ------------ Total $516,971,207 $269,903,185 $56,398,897 $271,325,901 ============ ============ ============ ============ Net Assets: Class A $457,693,047 $249,038,411 $47,759,594 $256,584,481 Class B $59,278,160 $20,864,774 $8,639,303 $14,741,420 Shares outstanding (Note 5): Class A 15,443,440 10,942,587 5,272,970 33,821,140 Class B 2,180,416 1,004,480 999,207 2,105,400 Net asset value and redemption price per share -- Class A $29.64 $22.76 $9.06 $7.59 ============ ============ ============ ============ Maximum offering price per share -- Class A (Net asset value/.9425)* $31.45 $24.15 $9.61 $8.05 ============ ============ ============ ============ Net asset value and offering price per share -- Class B (Note 5) $27.19 $20.77 $8.65 $7.00 ============ ============ ============ ============ * On purchases of $100,000 or more, the sales charge is reduced. See notes to financial statements Statements of Operations FIRST INVESTORS EQUITY FUNDS Six Months Ended March 31, 2006 - ------------------------------------------------------------------------------------------------------------------------------- TOTAL GROWTH & ALL-CAP RETURN VALUE BLUE CHIP INCOME GROWTH - ------------------------------------------------------------------------------------------------------------------------------- Investment Income Dividends $1,877,265(a) $3,754,422(b) $4,546,195(c) $6,086,833(d) $674,877(e) Interest 2,955,905 479,202 139,428 38,006 186,006 ------------ ------------ ------------ ------------ ------------ Total income 4,833,170 4,233,624 4,685,623 6,124,839 860,883 ------------ ------------ ------------ ------------ ------------ Expenses (Notes 1 and 3): Advisory fees 1,392,367 1,158,209 1,946,049 2,549,639 777,301 Distribution plan expenses -- Class A 435,988 423,085 640,922 934,935 274,375 Distribution plan expenses -- Class B 188,488 136,480 253,814 405,241 121,816 Shareholder servicing costs 405,708 402,273 761,585 940,490 373,648 Professional fees 34,855 36,564 50,391 68,677 27,167 Custodian fees 16,722 13,361 15,430 22,679 9,607 Registration fees 39,345 33,089 32,645 35,889 36,560 Reports to shareholders 72,141 77,852 114,785 148,179 66,011 Trustees' fees 7,971 7,379 11,799 17,054 4,944 Other expenses 38,364 38,018 51,147 71,465 27,334 ------------ ------------ ------------ ------------ ------------ Total expenses 2,631,949 2,326,310 3,878,567 5,194,248 1,718,763 Less: Expenses waived (163,014) -- (163,014) -- -- Expenses paid indirectly (10,825) (8,935) (10,849) (10,200) (3,346) ------------ ------------ ------------ ------------ ------------ Net expenses 2,458,110 2,317,375 3,704,704 5,184,048 1,715,417 ------------ ------------ ------------ ------------ ------------ Net investment income (loss) 2,375,060 1,916,249 980,919 940,791 (854,534) ------------ ------------ ------------ ------------ ------------ Realized and Unrealized Gain on Investments and Foreign Currency Transactions (Note 2): Net realized gain (loss) on: Investments 5,736,181 6,507,895 8,276,458 18,477,085 17,405,507 Foreign currency transactions -- -- -- -- -- ------------ ------------ ------------ ------------ ------------ Net realized gain on investments and foreign currency transactions 5,736,181 6,507,895 8,276,458 18,477,085 17,405,507 ------------ ------------ ------------ ------------ ------------ Net unrealized appreciation of: Investments 9,859,667 17,376,775 17,872,669 40,288,791 1,216,185 Foreign currency transactions -- -- -- -- -- ------------ ------------ ------------ ------------ ------------ Net unrealized appreciation of investments and foreign currency transactions 9,859,667 17,376,775 17,872,669 40,288,791 1,216,185 ------------ ------------ ------------ ------------ ------------ Net gain on investments and foreign currency transactions 15,595,848 23,884,670 26,149,127 58,765,876 18,621,692 ------------ ------------ ------------ ------------ ------------ Net Increase in Net Assets Resulting from Operations $17,970,908 $25,800,919 $27,130,046 $59,706,667 $17,767,158 ============ ============ ============ ============ ============ (a) Net of $712 foreign taxes withheld (b) Net of $2,538 foreign taxes withheld (c) Net of $873 foreign taxes withheld (d) Net of $2,309 foreign taxes withheld (e) Net of $3,672 foreign taxes withheld Statements of Operations (continued) FIRST INVESTORS EQUITY FUNDS Six Months Ended March 31, 2006 - ----------------------------------------------------------------------------------------------------------- MID-CAP SPECIAL FOCUSED OPPORTUNITY SITUATIONS EQUITY GLOBAL - ----------------------------------------------------------------------------------------------------------- Investment Income Dividends $2,293,981(f) $1,200,274 $421,850 $1,702,587(g) Interest 166,275 218,518 19,654 139,525 ------------ ------------ ------------ ------------ Total income 2,460,256 1,418,792 441,504 1,842,112 ------------ ------------ ------------ ------------ Expenses (Notes 1 and 3): Advisory fees 1,965,860 1,174,309 213,289 1,272,278 Distribution plan expenses -- Class A 639,858 339,979 71,758 363,302 Distribution plan expenses -- Class B 285,686 100,063 45,191 70,883 Shareholder servicing costs 755,488 452,241 144,089 397,134 Professional fees 43,327 28,463 14,307 52,301 Custodian fees 14,000 13,699 3,406 81,442 Registration fees 34,689 33,845 36,060 38,621 Reports to shareholders 123,716 80,645 32,055 104,559 Trustees' fees 11,565 5,985 1,399 6,251 Other expenses 52,577 23,710 4,503 22,788 ------------ ------------ ------------ ------------ Total expenses 3,926,766 2,252,939 566,057 2,409,559 Less: Expenses waived (163,014) (249,315) -- -- Expenses paid indirectly (14,262) (4,054) (421) (1,392) ------------ ------------ ------------ ------------ Net expenses 3,749,490 1,999,570 565,636 2,408,167 ------------ ------------ ------------ ------------ Net investment income (loss) (1,289,234) (580,778) (124,132) (566,055) ------------ ------------ ------------ ------------ Realized and Unrealized Gain on Investments and Foreign Currency Transactions (Note 2): Net realized gain (loss) on: Investments 23,490,196 7,977,893 1,031,169 16,900,758 Foreign currency transactions -- -- -- (16,878) ------------ ------------ ------------ ------------ Net realized gain on investments and foreign currency transactions 23,490,196 7,977,893 1,031,169 16,883,880 ------------ ------------ ------------ ------------ Net unrealized appreciation of: Investments 15,922,589 20,027,058 1,416,454 2,994,491 Foreign currency transactions -- -- -- 3,021 ------------ ------------ ------------ ------------ Net unrealized appreciation of investments and foreign currency transactions 15,922,589 20,027,058 1,416,454 2,997,512 ------------ ------------ ------------ ------------ Net gain on investments and foreign currency transactions 39,412,785 28,004,951 2,447,623 19,881,392 ------------ ------------ ------------ ------------ Net Increase in Net Assets Resulting from Operations $38,123,551 $27,424,173 $2,323,491 $19,315,337 ============ ============ ============ ============ (f) Net of $6,130 foreign taxes withheld (g) Net of $64,454 foreign taxes withheld See notes to financial statements Statements of Changes in Net Assets FIRST INVESTORS EQUITY FUNDS - ------------------------------------------------------------------------------------------------------------- TOTAL RETURN VALUE -------------------------- -------------------------- 10/1/2005 to 10/1/2004 to 10/1/2005 to 10/1/2004 to 3/31/2006 9/30/2005 3/31/2006 9/30/2005 - ------------------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment income $2,375,060 $4,761,075 $1,916,249 $3,192,276 Net realized gain on investments 5,736,181 14,327,122 6,507,895 10,988,910 Net unrealized appreciation of investments 9,859,667 6,264,904 17,376,775 13,771,189 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 17,970,908 25,353,101 25,800,919 27,952,375 ------------ ------------ ------------ ------------ Dividends to Shareholders Net investment income -- Class A (2,273,596) (4,688,964) (1,689,863) (2,633,134) Net investment income -- Class B (165,522) (428,201) (65,282) (122,898) ------------ ------------ ------------ ------------ Total dividends (2,439,118) (5,117,165) (1,755,145) (2,756,032) ------------ ------------ ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 31,551,250 64,070,678 36,445,424 84,851,705 Reinvestment of dividends 2,238,215 4,613,539 1,658,949 2,574,863 Cost of shares redeemed (23,480,957) (36,254,876) (21,112,322) (27,688,829) ------------ ------------ ------------ ------------ 10,308,508 32,429,341 16,992,051 59,737,739 ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 2,252,029 5,259,203 2,733,727 6,026,435 Reinvestment of dividends 164,267 425,505 64,674 121,750 Cost of shares redeemed (4,050,093) (6,076,543) (3,292,566) (5,162,063) ------------ ------------ ------------ ------------ (1,633,797) (391,835) (494,165) 986,122 ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions 8,674,711 32,037,506 16,497,886 60,723,861 ------------ ------------ ------------ ------------ Net increase (decrease) in net assets 24,206,501 52,273,442 40,543,660 85,920,204 Net Assets Beginning of period 319,089,331 266,815,889 294,272,944 208,352,740 ------------ ------------ ------------ ------------ End of period $343,295,832 $319,089,331 $334,816,604 $294,272,944 ============ ============ ============ ============ Includes undistributed net investment income (deficit) of $(268,576) $(204,518) $754,173 $593,069 ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 2,214,949 4,699,343 5,364,098 13,262,294 Issued for dividends reinvested 155,828 336,103 240,401 396,159 Redeemed (1,647,048) (2,656,447) (3,094,704) (4,319,198) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding 723,729 2,378,999 2,509,795 9,339,255 ============ ============ ============ ============ Class B: Sold 160,674 393,326 408,875 960,339 Issued for dividends reinvested 11,610 31,456 9,530 19,022 Redeemed (288,191) (452,242) (491,646) (818,095) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding (115,907) (27,460) (73,241) 161,266 ============ ============ ============ ============ Statements of Changes in Net Assets (continued) FIRST INVESTORS EQUITY FUNDS - ------------------------------------------------------------------------------------------------------------ BLUE CHIP GROWTH & INCOME -------------------------- -------------------------- 10/1/2005 to 10/1/2004 to 10/1/2005 to 10/1/2004 to 3/31/2006 9/30/2005 3/31/2006 9/30/2005 - ------------------------------------------------------------------------------------------------------------ Increase (Decrease) in Net Assets From Operations Net investment income $980,919 $2,231,932 $940,791 $3,980,086 Net realized gain on investments 8,276,458 27,341,802 18,477,085 52,239,623 Net unrealized appreciation of investments 17,872,669 19,535,734 40,288,791 22,329,279 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 27,130,046 49,109,468 59,706,667 78,548,988 ------------ ------------ ------------ ------------ Dividends to Shareholders Net investment income -- Class A (605,787) (2,052,222) (1,111,737) (4,113,800) Net investment income -- Class B -- (179,271) -- (201,083) ------------ ------------ ------------ ------------ Total dividends (605,787) (2,231,493) (1,111,737) (4,314,883) ------------ ------------ ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 30,316,492 44,068,883 64,460,646 105,630,410 Reinvestment of dividends 600,572 2,028,913 1,101,487 4,067,634 Cost of shares redeemed (37,993,442) (80,924,729) (49,273,436) (76,352,083) ------------ ------------ ------------ ------------ (7,076,378) (34,826,933) 16,288,697 33,345,961 ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 2,602,926 3,947,403 5,836,423 8,233,185 Reinvestment of dividends -- 178,831 -- 200,260 Cost of shares redeemed (7,553,877) (18,447,695) (11,339,051) (20,089,693) ------------ ------------ ------------ ------------ (4,950,951) (14,321,461) (5,502,628) (11,656,248) ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions (12,027,329) (49,148,394) 10,786,069 21,689,713 ------------ ------------ ------------ ------------ Net increase (decrease) in net assets 14,496,930 (2,270,419) 69,380,999 95,923,818 Net Assets Beginning of period 473,056,099 475,326,518 678,283,492 582,359,674 ------------ ------------ ------------ ------------ End of period $487,553,029 $473,056,099 $747,664,491 $678,283,492 ============ ============ ============ ============ Includes undistributed net investment income (deficit) of $375,571 $439 $637,164 $808,110 ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 1,432,408 2,197,308 4,539,269 8,066,584 Issued for dividends reinvested 28,096 98,491 76,353 306,678 Redeemed (1,794,483) (4,035,467) (3,465,583) (5,827,638) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding (333,979) (1,739,668) 1,150,039 2,545,624 ============ ============ ============ ============ Class B: Sold 131,486 209,604 427,337 659,640 Issued for dividends reinvested -- 9,266 -- 15,843 Redeemed (381,469) (980,107) (834,785) (1,603,975) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding (249,983) (761,237) (407,448) (928,492) ============ ============ ============ ============ See notes to financial statements Statements of Changes in Net Assets FIRST INVESTORS EQUITY FUNDS - ------------------------------------------------------------------------------------------------------------- ALL-CAP GROWTH MID-CAP OPPORTUNITY -------------------------- -------------------------- 10/1/2005 to 10/1/2004 to 10/1/2005 to 10/1/2004 to 3/31/2006 9/30/2005 3/31/2006 9/30/2005 - ------------------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment income (loss) $(854,534) $(1,303,216) $(1,289,234) $(1,887,963) Net realized gain on investments 17,405,507 12,586,390 23,490,196 25,408,825 Net unrealized appreciation (depreciation) of investments 1,216,185 9,837,022 15,922,589 61,015,861 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 17,767,158 21,120,196 38,123,551 84,536,723 ------------ ------------ ------------ ------------ Distributions to Shareholders Net investment income -- Class A -- -- -- -- Net investment income -- Class B -- -- -- -- Net realized gains -- Class A -- -- (11,436,474) -- Net realized gains -- Class B -- -- (1,696,534) -- ------------ ------------ ------------ ------------ Total distributions -- -- (13,133,008) -- ------------ ------------ ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 25,279,153 41,188,051 49,190,120 99,735,632 Reinvestment of distributions -- -- 11,364,891 -- Cost of shares redeemed (13,466,738) (20,615,450) (35,507,650) (40,559,126) ------------ ------------ ------------ ------------ 11,812,415 20,572,601 25,047,361 59,176,506 ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 2,099,570 3,422,603 4,997,839 8,855,927 Reinvestment of distributions -- -- 1,688,114 -- Cost of shares redeemed (2,281,278) (2,944,226) (7,048,843) (8,824,631) ------------ ------------ ------------ ------------ (181,708) 478,377 (362,890) 31,296 ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions 11,630,707 21,050,978 24,684,471 59,207,802 ------------ ------------ ------------ ------------ Net increase (decrease) in net assets 29,397,865 42,171,174 49,675,014 143,744,525 Net Assets Beginning of period 192,871,779 150,700,605 467,296,193 323,551,668 ------------ ------------ ------------ ------------ End of period $222,269,644 $192,871,779 $516,971,207 $467,296,193 ============ ============ ============ ============ Includes undistributed net investment income (deficits) of $(854,534) $-- $(1,289,234) $-- ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 2,723,059 4,995,352 1,739,182 3,889,924 Issued for distributions reinvested -- -- 429,026 -- Redeemed (1,447,622) (2,484,476) (1,252,098) (1,578,469) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding 1,275,437 2,510,876 916,110 2,311,455 ============ ============ ============ ============ Class B: Sold 233,442 428,824 190,844 373,923 Issued for distributions reinvested -- -- 69,270 -- Redeemed (254,169) (366,968) (269,204) (370,530) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding (20,727) 61,856 (9,090) 3,393 ============ ============ ============ ============ Statements of Changes in Net Assets (continued) FIRST INVESTORS EQUITY FUNDS - ------------------------------------------------------------------------------------------------------------ SPECIAL SITUATIONS FOCUSED EQUITY -------------------------- -------------------------- 10/1/2005 to 10/1/2004 to 10/1/2005 to 10/1/2004 to 3/31/2006 9/30/2005 3/31/2006 9/30/2005 - ------------------------------------------------------------------------------------------------------------ Increase (Decrease) in Net Assets From Operations Net investment income (loss) $(580,778) $(1,629,311) $(124,132) $174,184 Net realized gain on investments 7,977,893 54,920,845 1,031,169 2,888,567 Net unrealized appreciation (depreciation) of investments 20,027,058 (9,477,244) 1,416,454 3,284,026 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 27,424,173 43,814,290 2,323,491 6,346,777 ------------ ------------ ------------ ------------ Dividends to Shareholders Net investment income -- Class A -- -- (56,977) (111,522) Net investment income -- Class B -- -- -- (5,816) ------------ ------------ ------------ ------------ Total dividends -- -- (56,977) (117,338) ------------ ------------ ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 16,927,913 28,756,884 2,846,927 4,675,073 Reinvestment of dividends -- -- 56,668 110,993 Cost of shares redeemed (16,785,150) (34,605,124) (5,133,480) (11,403,250) ------------ ------------ ------------ ------------ 142,763 (5,848,240) (2,229,885) (6,617,184) ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 1,422,482 1,950,974 415,621 638,285 Reinvestment of dividends -- -- -- 5,739 Cost of shares redeemed (3,469,278) (5,674,721) (1,464,200) (2,929,303) ------------ ------------ ------------ ------------ (2,046,796) (3,723,747) (1,048,579) (2,285,279) ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions (1,904,033) (9,571,987) (3,278,464) (8,902,463) ------------ ------------ ------------ ------------ Net increase (decrease) in net assets 25,520,140 34,242,303 (1,011,950) (2,673,024) Net Assets Beginning of period 244,383,045 210,140,742 57,410,847 60,083,871 ------------ ------------ ------------ ------------ End of period $269,903,185 $244,383,045 $56,398,897 $57,410,847 ============ ============ ============ ============ Includes undistributed net investment income (deficits) of $(580,778) $-- $(124,263) $56,846 ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 807,933 1,508,510 321,455 559,778 Issued for dividends reinvested -- -- 6,447 13,198 Redeemed (804,617) (1,823,381) (578,290) (1,366,256) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding 3,316 (314,871) (250,388) (793,280) ============ ============ ============ ============ Class B: Sold 73,334 111,825 49,321 79,352 Issued for dividends reinvested -- -- -- 709 Redeemed (180,528) (324,252) (173,290) (364,892) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding (107,194) (212,427) (123,969) (284,831) ============ ============ ============ ============ See notes to financial statements Statements of Changes in Net Assets FIRST INVESTORS EQUITY FUNDS - -------------------------------------------------------------------------------- GLOBAL -------------------------- 10/1/2005 to 10/1/2004 to 3/31/2006 9/30/2005 - -------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment income (loss) $(566,055) $29,227 Net realized gain on investments and foreign currency transactions 16,883,880 26,274,478 Net unrealized appreciation of investments and foreign currency transactions 2,997,512 15,303,113 ------------ ------------ Net increase in net assets resulting from operations 19,315,337 41,606,818 ------------ ------------ Dividends to Shareholders Net investment income -- Class A (511,515) -- Net investment income -- Class B -- -- ------------ ------------ Total dividends (511,515) -- ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 15,682,990 21,167,913 Reinvestment of dividends 455,744 -- Cost of shares redeemed (15,962,724) (30,999,052) ------------ ------------ 176,010 (9,831,139) ------------ ------------ Class B: Proceeds from shares sold 1,211,402 1,619,784 Cost of shares redeemed (1,958,286) (4,823,294) ------------ ------------ (746,884) (3,203,510) ------------ ------------ Net decrease from share transactions (570,874) (13,034,649) ------------ ------------ Net increase in net assets 18,232,948 28,572,169 Net Assets Beginning of period 253,092,953 224,520,784 ------------ ------------ End of period $271,325,901 $253,092,953 ============ ============ Includes undistributed net investment deficit of $(1,077,570) $-- ============ ============ *Shares Issued and Redeemed Class A: Sold 2,162,851 3,230,403 Issued for dividends reinvested 63,740 -- Redeemed (2,214,569) (4,739,544) ------------ ------------ Net increase (decrease) in Class A shares outstanding 12,022 (1,509,141) ============ ============ Class B: Sold 181,003 266,888 Redeemed (295,332) (800,150) ------------ ------------ Net decrease in Class B shares outstanding (114,329) (533,262) ============ ============ See notes to financial statements Notes to Financial Statements FIRST INVESTORS EQUITY FUNDS March 31, 2006 1. Significant Accounting Policies--First Investors Equity Funds, a Delaware statutory trust ("the Trust"), is registered under the Investment Company Act of 1940 ("the 1940 Act") as a diversified, open-end management investment company. The Trust operates as a series fund, issuing shares of beneficial interest in the Total Return Fund, Value Fund, Blue Chip Fund, Growth & Income Fund, All-Cap Growth Fund, Mid-Cap Opportunity Fund, Special Situations Fund, Focused Equity Fund and Global Fund (each a "Fund", collectively, "the Funds"), and accounts separately for the assets, liabilities and operations of each Fund. Focused Equity Fund is registered as a non-diversified series of the Trust. The objective of each Fund is as follows: Total Return Fund seeks high, long-term total investment return consistent with moderate investment risk. Value Fund seeks total return. Blue Chip Fund seeks high total investment return. Growth & Income Fund seeks long-term growth of capital and current income. All-Cap Growth Fund seeks long-term growth of capital. Mid-Cap Opportunity Fund seeks long-term capital growth. Special Situations Fund seeks long-term growth of capital. Focused Equity Fund seeks capital appreciation. Global Fund primarily seeks long-term capital growth and, secondarily, a reasonable level of current income. A. Security Valuation--Except as provided below, a security listed or traded on an exchange or the Nasdaq Stock Market is valued at its last sale price on the exchange or market where the security is principally traded, and lacking any sales, the security is valued at the mean between the closing bid and asked prices. Securities traded in the over-the-counter ("OTC") market (including securities listed on exchanges whose primary market is believed to be OTC) are valued at the mean between the last bid and asked prices based upon quotes furnished by a market maker for such securities. Securities may also be priced by a pricing service approved by the Trust's Board of Trustees ("the Board"). The pricing service considers security type, rating, market condition and yield data as well as market quotations, prices provided by market makers and other available information in determining value. Short-term debt securities that mature in 60 days or less are valued at amortized cost. The Funds monitor for significant events occurring after the close of foreign markets but prior to the close of trading on the New York Stock Exchange that could have a material Notes to Financial Statements (continued) FIRST INVESTORS EQUITY FUNDS March 31, 2006 impact on the value of any foreign securities that are held by the Funds. Examples of such events include natural disasters, political events, issuer-specific developments such as bankruptcies and significant fluctuations in securities markets. If the Funds' Valuation Committee decides that such events warrant using fair value estimates for foreign securities, it will take such events into consideration in determining the fair values of such securities. If market quotations or prices are not readily available or determined to be unreliable, the securities will be valued at fair value as determined in good faith pursuant to procedures adopted by the Board. For valuation purposes, where applicable, quotations of foreign securities in foreign currency are translated to U.S. dollar equivalents using the foreign exchange quotation in effect. B. Federal Income Taxes--No provision has been made for federal income taxes on net income or capital gains since it is the policy of each Fund to continue to comply with the special provisions of the Internal Revenue Code applicable to investment companies and to make sufficient distributions of income and capital gains (in excess of any available capital loss carryovers) to relieve it from all, or substantially all, such taxes. At September 30, 2005, capital loss carryovers were as follows: Year Capital Loss Carryovers Expire ------------------------------------------------------------------- Fund Total 2009 2010 2011 2012 - ---- ----- ---- ---- ---- ---- Total Return $ 8,563,719 $ -- $ -- $ 8,563,719 $ -- Value 48,807,852 -- 12,401,373 36,406,479 -- Blue Chip 103,865,283 -- 34,677,744 69,187,539 -- Growth & Income 26,077,239 -- -- 26,077,239 -- All-Cap Growth 4,730,580 -- -- 4,730,580 -- Special Situations 6,051,363 -- -- 6,051,363 -- Focused Equity 23,740,685 10,726,015 1,712,582 9,856,986 1,445,102 Global 4,588,793 -- -- 4,588,793 -- C. Distributions to Shareholders--Dividends from net investment income, if any, of Total Return Fund, Value Fund, Blue Chip Fund and Growth & Income Fund are declared and paid quarterly. Dividends from net investment income, if any, of All-Cap Growth Fund, Mid-Cap Opportunity Fund, Special Situations Fund, Focused Equity Fund and Global Fund are declared and paid annually. Distributions from net realized capital gains, if any, are normally declared and paid annually. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for capital loss carryforwards, deferral of wash sales losses, post-October capital losses, net operating losses and foreign currency transactions. D. Expense Allocation--Expenses directly charged or attributable to a Fund are paid from the assets of that Fund. General expenses of the Trust are allocated among and charged to the assets of each Fund on a fair and equitable basis, which may be based on the relative assets of each Fund or the nature of the services performed and relative applicability to each Fund. E. Repurchase Agreements--Securities pledged as collateral for repurchase agreements entered into by the All-Cap Growth Fund, Focused Equity Fund, and Global Fund are held by each Fund's custodian until maturity of the repurchase agreement. The agreements provide that the Funds will receive, as collateral, securities with a market value which will at all times be equal to at least 100% of the amount invested by the Funds. F. Use of Estimates--The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. G. Foreign Currency Translations--The accounting records of Global Fund are maintained in U.S. dollars. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated to U.S. dollars at the date of valuation. Purchases and sales of investment securities, dividend income and certain expenses are translated to U.S. dollars at the rates of exchange prevailing on the respective dates of such transactions. Global Fund does not isolate the portion of gains and losses on investments which is due to changes in foreign exchange rates from that which is due to changes in market prices of the investments. These changes are included with the net realized and unrealized gains and losses from investments. Net realized and unrealized gains and losses on foreign currency transactions include gains and losses from the sales of foreign currency and gains and losses on accrued foreign dividends and related withholding taxes. H. Other--Security transactions are accounted for on the date the securities are purchased or sold. Cost is determined, and gains and losses are based, on the identified cost basis for both financial statement and federal income tax purposes. Dividend income is recorded on the ex-dividend date. Interest income and estimated expenses are accrued daily. Bond discounts and premiums are accreted or amortized using the interest method. For the six months ended March 31, 2006, the Bank of Notes to Financial Statements (continued) FIRST INVESTORS EQUITY FUNDS March 31, 2006 New York, custodian of each Fund, other than Global Fund, has provided total credits in the amount of $47,608 against custodian charges based on the uninvested cash balances of these Funds. The Funds also reduced expenses through brokerage service arrangements. For the six months ended March 31, 2006, the Funds' expenses were reduced by $16,676 under these arrangements. 2. Security Transactions--For the six months ended March 31, 2006, purchases and sales of securities and long-term U.S. Government obligations (excluding U.S. Treasury bills, repurchase agreements, short-term securities and foreign currencies) were as follows: Long-Term U.S. Securities Government Obligations --------------------------- --------------------------- Cost of Proceeds Cost of Proceeds Fund Purchases from Sales Purchases from Sales - ---- ------------ ------------ ------------ ------------ Total Return $ 90,383,175 $ 85,081,462 $22,141,367 $11,775,033 Value 41,955,257 24,024,883 -- -- Blue Chip 21,755,629 33,409,512 -- -- Growth & Income 131,967,879 121,186,154 -- -- All-Cap Growth 121,046,050 110,640,809 -- -- Mid-Cap Opportunity 108,989,744 105,064,174 -- -- Special Situations 55,775,554 55,015,996 -- -- Focused Equity 20,175,479 24,247,943 -- -- Global 146,091,677 148,777,702 -- -- At March 31, 2006, aggregate cost and net unrealized appreciation of securities for federal income tax purposes were as follows: Gross Gross Net Aggregate Unrealized Unrealized Unrealized Fund Cost Appreciation Depreciation Appreciation - ---- ------------ ------------ ------------ ------------ Total Return $300,382,290 $ 54,195,090 $11,616,359 $42,578,731 Value 265,922,557 73,517,472 4,186,320 69,331,152 Blue Chip 371,224,642 127,129.273 10,304,080 116,825,193 Growth & Income 591,517,952 184,955,379 29,372,322 155,583,057 All-Cap Growth 187,930,410 37,059,555 3,430,383 33,629,172 Mid-Cap Opportunity 388,522,833 136,567,153 7,133,752 129,433,401 Special Situations 224,439,433 52,743,138 7,808,800 44,934,338 Focused Equity 49,614,292 8,170,766 1,009,372 7,161,394 Global 226,440,929 47,143,833 2,608,213 44,535,620 3. Advisory Fee and Other Transactions with Affiliates--Certain officers and trustees of the Trust are officers and directors of the Trust's investment adviser, First Investors Management Company, Inc. ("FIMCO"), its underwriter, First Investors Corporation ("FIC"), its transfer agent, Administrative Data Management Corp. ("ADM") and/or First Investors Federal Savings Bank, ("FIFSB"), custodian of the Funds' retirement accounts. Trustees of the Trust who are not "interested persons" of the Funds as defined in the 1940 Act are remunerated by the Funds. For the six months ended March 31, 2006, total trustees fees accrued by the Funds amounted to $74,347. The Investment Advisory Agreements provide as compensation to FIMCO, an annual fee, payable monthly, at the following rates: Total Return, Blue Chip and Mid-Cap Opportunity Funds--Through January 27, 2006, the rate was 1% on the first $200 million of each Fund's average daily net assets, .75% on the next $300 million, and declined by .03% on each $250 million thereafter, down to .66% on average daily net assets over $1 billion. Effective January 28, 2006, the rate was changed to .75% on the first $300 million of each Fund's average daily net assets, .72% on the next $200 million, .69% on the next $250 million, .66% on the next $500 million, declining by .02% on each $500 million thereafter, down to .60% on average daily net assets over $2.25 billion. During the period October 1, 2005 to January 27, 2006, FIMCO has waived 25% of the 1% annual fee on the first $200 million of each Fund's average daily net assets. Special Situations Fund--Through January 27, 2006, the rate was 1% on the first $200 million of the Fund's average daily net assets, .75% on the next $300 million, and declined by .03% on each $250 million thereafter, down to ..66% on average daily net assets over $1 billion. Effective January 28, 2006, the rate was changed to 1% on the first $200 million of the Fund's average daily net assets, .75% on the next $300 million, .72% on the next $250 million, .69% on the next $250 million, .66% on the next $500 million, and .64% on average daily net assets over $1.5 billion. During the period October 1, 2005 to March 31, 2006, FIMCO has waived 25% of the 1% annual fee on the first $200 million of the Fund's average daily net assets. Value, Growth & Income, All-Cap Growth, and Focused Equity Funds--Through January 27, 2006, the rate was .75% on the first $300 million of each Fund's average daily net assets, .72% on the next $200 million, .69% on the next $250 million and .66% on average daily net assets over $750 million. Effective January 28, 2006, the rate was changed to 75% on the first $300 million of each Fund's average daily net assets, .72% on the next $200 million, .69% on the next $250 million, .66% Notes to Financial Statements (continued) FIRST INVESTORS EQUITY FUNDS March 31, 2006 on the next $500 million, declining by .02% on each $500 million thereafter, down to .60% on average daily net assets over $2.25 billion. Global Fund--Through January 27, 2006, the rate was 1% on the first $250 million of the Fund's average daily net assets, and declined by .03% on each $250 million thereafter, down to .91% on average daily net assets over $750 million. Effective January 28, 2006, the rate was changed to .98% on the first $300 million of the Fund's average daily net assets, .95% on the next $300 million, .92% on the next $400 million, .90% on the next $500 million and .88% on average daily net assets over $1.5 billion. For the six months ended March 31, 2006, total advisory fees accrued to FIMCO by the Funds were $12,449,301 of which $738,357 was waived. For the six months ended March 31, 2006, FIC, as underwriter, received $9,710,454 in commissions from the sale of shares of the Funds, after allowing $28,171 to other dealers. Shareholder servicing costs included $3,487,109 in transfer agent fees accrued to ADM and $929,430 in retirement accounts custodian fees accrued to FIFSB. Pursuant to Distribution Plans adopted under Rule 12b-1 of the 1940 Act, each Fund is authorized to pay FIC a fee up to .30% of the average daily net assets of the Class A shares and 1% of the average daily net assets of the Class B shares on an annualized basis each fiscal year, payable monthly. The fee consists of a distribution fee and a service fee. The service fee is paid for the ongoing servicing of clients who are shareholders of that Fund. For the six months ended March 31, 2006, total distribution plan fees accrued to FIC by the Funds were $5,731,864. Wellington Management Company, LLP ("Wellington") serves as investment subadviser to All-Cap Growth Fund, Focused Equity Fund and Global Fund. Paradigm Capital Management, Inc. serves as investment subadviser to Special Situations Fund. The subadvisers are paid by FIMCO and not by the Funds. 4. Forward Currency Contracts--A forward currency contract is an obligation to purchase or sell a specific currency for an agreed-upon price at a future date. When a Fund purchases or sells foreign securities it customarily enters into a forward currency contract to minimize foreign exchange risk between the trade date and the settlement date of such transactions. The Fund could be exposed to risk if counter parties to the contracts are unable to meet the terms of their contracts or if the value of the foreign currency changes unfavorably. Forward currency contracts are "marked-to-market" daily at the applicable exchange rate and the resulting unrealized gains or losses are reflected in the Fund's assets. The following forward currency contracts were open at March 31, 2006: All-Cap Growth Fund: Contracts to Sell Unrealized Foreign Currency In Exchange for Settlement Date Gain (Loss) - ---------------------------- --------------- --------------- ---------- 10,633 Euro US$ 12,797 4/3/06 US$ (70) 23,255 Euro 28,759 4/4/06 116 --------------- ---------- $ 41,556 =============== Net Unrealized Gain on Forward Currency Contracts $ 46 ========== Global Fund: Contracts to Buy Unrealized Foreign Currency In Exchange for Settlement Date Gain (Loss) - ---------------------------- --------------- --------------- ---------- 96,253 Canadian Dollars US$ 82,172 4/3/06 US$ 335 3,632,709 Norwegian Krone 553,589 4/4/06 (63) --------------- ---------- $635,761 272 =============== ---------- Contracts to Sell Unrealized Foreign Currency In Exchange for Settlement Date Gain (Loss) - ---------------------------- --------------- --------------- ---------- 654,906 Hong Kong Dollar US$ 84,394 4/3/06 US$ (3) 91,083,776 Japanese Yen 776,040 4/3/06 4,078 18,945,209 Japanese Yen 161,656 4/4/06 1,090 --------------- ---------- $1,022,090 5,165 =============== ---------- Net Unrealized Gain on Forward Currency Contracts $5,437 ========== 5. Capital--The Trust is authorized to issue an unlimited number of shares of beneficial interest without par value. The Trust consists of the Funds listed on the cover page, each of which is a separate and distinct series of the Trust. Each Fund has designated two classes of shares, Class A shares and Class B shares (each, a "Class"). Each share of each Class has an equal beneficial interest in the assets, has identical voting, dividend, liquidation and other rights and is subject to the same terms and conditions except that expenses allocated to a Class may be borne solely by that Class as determined by the Trustees and a Class may have exclusive voting rights with respect to matters affecting only that Class. Class A and Class B shares have a public offering price that reflects different sales charges and expense levels. Class A shares are sold with an initial sales charge of up to 5.75% of the amount invested and together with the Class B shares are subject to distribution plan fees as described in Notes to Financial Statements (continued) FIRST INVESTORS EQUITY FUNDS March 31, 2006 Note 3. Class B shares are sold without an initial sales charge, but are generally subject to a contingent deferred sales charge which declines in steps from 4% to 0% over a six-year period. Class B shares automatically convert into Class A shares after eight years. Realized and unrealized gains or losses, investment income and expenses (other than distribution plan fees) are allocated daily to each class of shares based upon the relative proportion of net assets to each class. 6. Fund Reorganizations--At the close of business on January 27, 2006, First Investors Global Fund, Inc., First Investors Series Fund (Blue Chip, Special Situations and Total Return Funds) and First Investors Series Fund II, Inc. (All-Cap Growth, Focused Equity, Growth & Income, Mid-Cap Opportunity and Value Funds) were reorganized into corresponding series of the Trust pursuant to an Agreement and Plan of Conversion and Termination (the "Reorganizations") that was approved by each Fund's shareholders. The Reorganizations were accomplished through tax-free exchanges of shares, which had no impact on net assets, operations, and number of shares outstanding. This page intentionally left blank. Financial Highlights FIRST INVESTORS The following table sets forth the per share operating performance data for a share outstanding, total return, ratios to average net assets and other supplemental data for each fiscal year ended September 30, except as otherwise indicated. - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Realized Value, Net and Unrealized Total from Net Net Beginning Investment Gain (Loss) on Investment Investment Realized Total of Period Income Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- TOTAL RETURN FUND - ----------------- Class A - ------- 2001 $16.27 $ .26 $(2.86) $(2.60) $ .32 $1.07 $1.39 2002++ 12.28 .22 (1.59) (1.37) .32 -- .32 2003 10.59 .20 1.44 1.64 .21 -- .21 2004 12.02 .20 .96 1.16 .20 -- .20 2005 12.98 .23 .97 1.20 .25 -- .25 2006 (b) 13.93 .12 .66 .78 .11 -- .11 Class B - ------- 2001 16.05 .18 (2.84) (2.66) .21 1.07 1.28 2002++ 12.11 .15 (1.59) (1.44) .21 -- .21 2003 10.46 .09 1.44 1.53 .13 -- .13 2004 11.86 .12 .94 1.06 .12 -- .12 2005 12.80 .13 .95 1.08 .15 -- .15 2006 (b) 13.73 .07 .64 .71 .06 -- .06 - ----------------------------------------------------------------------------------------------------- VALUE FUND+++ - ----------------- Class A - ------- 2001 $ 8.60 $ .10 $(2.10) $(2.00) $ .11 $ .56 $ .67 2002++ 5.93 .11 (1.65) (1.54) .13 -- .13 2003 4.26 .08 .73 .81 .08 -- .08 2004 4.99 .07 .96 1.03 .07 -- .07 2005 5.95 .08 .65 .73 .07 -- .07 2006 (b) 6.61 .04 .52 .56 .04 -- .04 Class B - ------- 2001 8.47 .06 (2.07) (2.01) .06 .56 .62 2002++ 5.84 .07 (1.63) (1.56) .08 -- .08 2003 4.20 .05 .71 .76 .04 -- .04 2004 4.92 .03 .95 .98 .03 -- .03 2005 5.87 .04 .63 .67 .03 -- .03 2006 (b) 6.51 .02 .51 .53 .02 -- .02 - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed Net Asset -------------------- ---------------------- Value, Net Assets Net Net Portfolio End of Total End of Period Investment Investment Turnover Period Return* (in millions) Expenses Income Expenses Income Rate - ----------------------------------------------------------------------------------------------------------- TOTAL RETURN FUND - ----------------- Class A - ------- 2001 $12.28 (17.31)% $121 1.37% 2.02% 1.62% 1.77% 130% 2002++ 10.59 (11.44) 129 1.47 1.91 1.72 1.66 185 2003 12.02 15.58 177 1.52 1.72 1.77 1.47 80 2004 12.98 9.65 231 1.44 1.60 1.65 1.39 41 2005 13.93 9.25 281 1.40 1.69 1.57 1.52 52 2006 (b) 14.60 5.61 305 1.42+ 1.52+ 1.52+ 1.42+ 31 Class B - ------- 2001 12.11 (17.82) 19 2.07 1.32 2.32 1.07 130 2002++ 10.46 (12.09) 22 2.17 1.21 2.42 .96 185 2003 11.86 14.71 28 2.22 1.02 2.47 .77 80 2004 12.80 8.92 36 2.14 .90 2.35 .69 41 2005 13.73 8.49 38 2.10 .99 2.27 .82 52 2006 (b) 14.38 5.19 38 2.12+ .82+ 2.22+ .72+ 31 - ----------------------------------------------------------------------------------------------------------- VALUE FUND+++ - ----------------- Class A - ------- 2001 $ 5.93 (24.98)% $149 1.37% 1.47% N/A N/A 51% 2002++ 4.26 (26.34) 99 1.51 1.93 N/A N/A 40 2003 4.99 19.04 126 1.67 1.69 N/A N/A 198 2004 5.95 20.57 185 1.48 1.21 N/A N/A 11 2005 6.61 12.31 267 1.43 1.31 N/A N/A 17 2006 (b) 7.13 8.49 306 1.44+ 1.29+ N/A N/A 8 Class B - ------- 2001 5.84 (25.46) 26 2.07 .77 N/A N/A 51 2002++ 4.20 (26.94) 17 2.21 1.23 N/A N/A 40 2003 4.92 18.26 19 2.37 .99 N/A N/A 198 2004 5.87 19.91 23 2.18 .51 N/A N/A 11 2005 6.51 11.43 27 2.13 .61 N/A N/A 17 2006 (b) 7.02 8.09 29 2.14+ .59+ N/A N/A 8 - ----------------------------------------------------------------------------------------------------------- Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- BLUE CHIP FUND - -------------------- Class A - ------- 2001 $31.09 $ -- $(8.64) $(8.64) $.01 $3.30 $3.31 2002 19.14 (.03) (4.55) (4.58) -- -- -- 2003 14.56 -- 2.58 2.58 -- -- -- 2004 17.14 .01 1.54 1.55 -- -- -- 2005 18.69 .10 1.91 2.01 .10 -- .10 2006 (b) 20.60 .05 1.16 1.21 .03 -- .03 Class B - ------- 2001 30.21 (.16) (8.33) (8.49) -- 3.30 3.30 2002 18.42 (.16) (4.35) (4.51) -- -- -- 2003 13.91 (.11) 2.46 2.35 -- -- -- 2004 16.26 (.13) 1.48 1.35 -- -- -- 2005 17.61 .09 1.67 1.76 .07 -- .07 2006 (b) 19.30 (.03) 1.09 1.06 -- -- -- - ----------------------------------------------------------------------------------------------------- GROWTH & INCOME FUND - -------------------- Class A - ------- 2001 $16.61 $ .06 $(3.99) $(3.93) $.03 $1.49 $1.52 2002++ 11.16 .03 (2.31) (2.28) .05 -- .05 2003 8.83 .04 1.85 1.89 .04 -- .04 2004 10.68 .06 1.43 1.49 .03 -- .03 2005 12.14 .09 1.54 1.63 .10 -- .10 2006 (b) 13.67 .02 1.18 1.20 .03 -- .03 Class B - ------- 2001 16.17 (.01) (3.88) (3.89) -- 1.49 1.49 2002++ 10.79 (.04) (2.24) (2.28) -- -- -- 2003 8.51 (.03) 1.78 1.75 -- -- -- 2004 10.26 (.03) 1.39 1.36 -- -- -- 2005 11.62 (.04) 1.51 1.47 .03 -- .03 2006 (b) 13.06 (.05) 1.14 1.09 -- -- -- - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- BLUE CHIP FUND - -------------------- Class A - ------- 2001 $19.14 (30.88)% $445 1.35% (.02)% 1.43% (.10)% 117% 2002 14.56 (23.93) 333 1.48 (.17) 1.58 (.27) 144 2003 17.14 17.72 383 1.56 -- 1.68 (.12) 111 2004 18.69 9.04 414 1.47 .03 1.58 (.08) 94 2005 20.60 10.76 421 1.45 .54 1.56 .43 55 2006 (b) 21.78 5.88 438 1.48+ .48+ 1.54+ .42+ 5 Class B - ------- 2001 18.42 (31.33) 78 2.05 (.72) 2.13 (.80) 117 2002 13.91 (24.48) 57 2.18 (.87) 2.28 (.97) 144 2003 16.26 16.90 62 2.26 (.70) 2.38 (.82) 111 2004 17.61 8.30 61 2.17 (.67) 2.28 (.78) 94 2005 19.30 9.98 52 2.15 (.16) 2.26 (.27) 55 2006 (b) 20.36 5.49 50 2.18+ (.22)+ 2.24+ (.28)+ 5 - ----------------------------------------------------------------------------------------------------------- GROWTH & INCOME FUND - -------------------- Class A - ------- 2001 $11.16 (25.91)% $383 1.34% .47% N/A N/A 168% 2002++ 8.83 (20.53) 318 1.46 .33 N/A N/A 169 2003 10.68 21.49 400 1.52 .44 N/A N/A 70 2004 12.14 13.95 499 1.42 .53 N/A N/A 32 2005 13.67 13.43 597 1.38 .72 N/A N/A 42 2006 (b) 14.84 8.75 665 1.39+ .34+ N/A N/A 17 Class B - ------- 2001 10.79 (26.38) 82 2.04 (.23) N/A N/A 168 2002++ 8.51 (21.13) 65 2.16 (.37) N/A N/A 169 2003 10.26 20.56 76 2.22 (.26) N/A N/A 70 2004 11.62 13.26 83 2.12 (.17) N/A N/A 32 2005 13.06 12.65 82 2.08 .02 N/A N/A 42 2006 (b) 14.15 8.35 83 2.09+ (.36)+ N/A N/A 17 - ----------------------------------------------------------------------------------------------------------- Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- ALL-CAP GROWTH FUND - ------------------- Class A - ------- 2001(a) $10.00 $(.05) $(3.42) $(3.47) -- -- -- 2002 6.53 (.06) (1.14) (1.20) -- -- -- 2003 5.33 (.06) 1.48 1.42 -- -- -- 2004 6.75 (.07) 1.12 1.05 -- -- -- 2005 7.80 (.05) 1.07 1.02 -- -- -- 2006 (b) 8.82 (.03) .83 .80 -- -- -- Class B - ------- 2001(a) 10.00 (.08) (3.43) (3.51) -- -- -- 2002 6.49 (.10) (1.13) (1.23) -- -- -- 2003 5.26 (.09) 1.44 1.35 -- -- -- 2004 6.61 (.12) 1.10 .98 -- -- -- 2005 7.59 (.11) 1.04 .93 -- -- -- 2006 (b) 8.52 (.06) .80 .74 -- -- -- - ----------------------------------------------------------------------------------------------------- MID-CAP OPPORTUNITY FUND - ------------------------ Class A - ------- 2001 $26.66 (.05) $(7.67) $(7.72) -- $1.30 $1.30 2002 17.64 (.13) (1.73) (1.86) -- -- -- 2003 15.78 (.12) 3.52 3.40 -- -- -- 2004 19.18 (.09) 3.62 3.53 -- -- -- 2005 22.71 (.09) 5.62 5.53 -- -- -- 2006 (b) 28.24 (.06) 2.24 2.18 -- .78 .78 Class B - ------- 2001 25.54 (.18) (7.32) (7.50) -- 1.30 1.30 2002 16.74 (.24) (1.63) (1.87) -- -- -- 2003 14.87 (.23) 3.31 3.08 -- -- -- 2004 17.95 (.23) 3.38 3.15 -- -- -- 2005 21.10 (.26) 5.22 4.96 -- -- -- 2006 (b) 26.06 (.15) 2.06 1.91 -- .78 .78 - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- ALL-CAP GROWTH FUND - ------------------- Class A - ------- 2001(a) $ 6.53 (34.70)% $ 35 1.75%+ (.90)%+ 2.10%+ (1.25)%+ 84% 2002 5.33 (18.38) 44 1.75 (1.03) 1.98 (1.26) 138 2003 6.75 26.64 77 1.94 (1.15) 1.96 (1.17) 126 2004 7.80 15.56 130 1.68 (1.12) N/A N/A 75 2005 8.82 13.08 169 1.58 (.66) N/A N/A 91 2006 (b) 9.62 9.07 197 1.58+ (.74)+ N/A N/A 56 Class B - ------- 2001(a) 6.49 (35.10) 8 2.45+ (1.60)+ 2.80+ (1.95)+ 84 2002 5.26 (18.95) 9 2.45 (1.73) 2.68 (1.96) 138 2003 6.61 25.67 14 2.64 (1.85) 2.66 (1.87) 126 2004 7.59 14.83 20 2.38 (1.82) N/A N/A 75 2005 8.52 12.25 23 2.28 (1.36) N/A N/A 91 2006 (b) 9.26 8.69 25 2.28+ (1.44)+ N/A N/A 56 - ----------------------------------------------------------------------------------------------------------- MID-CAP OPPORTUNITY FUND - ------------------------ Class A - ------- 2001 $17.64 (30.34)% $109 1.51% (.27)% 1.76% (.52)% 123% 2002 15.78 (10.55) 131 1.70 (.82) 1.95 (1.07) 112 2003 19.18 21.55 192 1.73 (.80) 1.97 (1.04) 37 2004 22.71 18.41 277 1.56 (.46) 1.73 (.63) 40 2005 28.24 24.35 410 1.48 (.39) 1.61 (.52) 43 2006 (b) 29.64 8.05 458 1.47+ (.47)+ 1.54+ (.54)+ 22 Class B - ------- 2001 16.74 (30.84) 22 2.21 (.97) 2.46 (1.22) 123 2002 14.87 (11.17) 25 2.40 (1.52) 2.65 (1.77) 112 2003 17.95 20.71 35 2.43 (1.50) 2.67 (1.74) 37 2004 21.10 17.55 46 2.26 (1.16) 2.43 (1.33) 40 2005 26.06 23.51 57 2.18 (1.09) 2.31 (1.22) 43 2006 (b) 27.19 7.68 59 2.17+ (1.17)+ 2.24+ (1.24)+ 22 - ----------------------------------------------------------------------------------------------------------- Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- SPECIAL SITUATIONS FUND - -------------------------- Class A - ------- 2001 $31.82 $(.18) $(11.59) $(11.77) -- $4.89 $4.89 2002 15.16 (.19) (2.31) (2.50) -- -- -- 2003 12.66 (.17) 3.14 2.97 -- -- -- 2004 15.63 (.18) 1.39 1.21 -- -- -- 2005 16.84 (.12) 3.72 3.60 -- -- -- 2006 (b) 20.44 (.04) 2.36 2.32 -- -- -- Class B - ------- 2001 30.46 (.29) (11.00) (11.29) -- 4.89 4.89 2002 14.28 (.29) (2.15) (2.44) -- -- -- 2003 11.84 (.25) 2.93 2.68 -- -- -- 2004 14.52 (.30) 1.32 1.02 -- -- -- 2005 15.54 (.26) 3.44 3.18 -- -- -- 2006 (b) 18.72 (.11) 2.16 2.05 -- -- -- - ----------------------------------------------------------------------------------------------------- FOCUSED EQUITY FUND - ------------------- Class A - ------- 2001 $10.38 $(.03) $(2.63) $(2.66) $ -- -- $ -- 2002 7.72 (.07) (1.92) (1.99) -- -- -- 2003 5.73 (.02) 1.52 1.50 -- -- -- 2004 7.23 (.02) .62 .60 -- -- -- 2005 7.83 .03 .86 .89 .02 -- .02 2006 (b) 8.70 (.01) .38 .37 .01 -- .01 Class B - ------- 2001 10.26 (.09) (2.59) (2.68) -- -- -- 2002 7.58 (.13) (1.86) (1.99) -- -- -- 2003 5.59 (.07) 1.48 1.41 -- -- -- 2004 7.00 (.08) .61 .53 -- -- -- 2005 7.53 (.02) .82 .80 -- -- -- 2006 (b) 8.33 (.05) .37 .32 -- -- -- - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- SPECIAL SITUATIONS FUND - -------------------------- Class A - ------- 2001 $15.16 (42.86)% $164 1.54% (.94)% 1.75% (1.15)% 183% 2002 12.66 (16.49) 138 1.69 (1.24) 1.93 (1.48) 153 2003 15.63 23.46 169 1.80 (1.26) 2.05 (1.51) 111 2004 16.84 7.74 190 1.63 (1.08) 1.86 (1.31) 119 2005 20.44 21.38 224 1.60 (.64) 1.82 (.86) 112 2006 (b) 22.76 11.35 249 1.57+ (.42)+ 1.77+ (.62)+ 23 Class B - ------- 2001 14.28 (43.26) 21 2.24 (1.64) 2.45 (1.85) 183 2002 11.84 (17.09) 18 2.39 (1.94) 2.63 (2.18) 153 2003 14.52 22.63 20 2.50 (1.96) 2.75 (2.21) 111 2004 15.54 7.03 21 2.33 (1.78) 2.56 (2.01) 119 2005 18.72 20.46 21 2.30 (1.34) 2.52 (1.56) 112 2006 (b) 20.77 10.95 21 2.27+ (1.12)+ 2.47+ (1.32)+ 23 - ----------------------------------------------------------------------------------------------------------- FOCUSED EQUITY FUND - ------------------- Class A - ------- 2001 $ 7.72 (25.63)% $ 51 1.75% (.35)% N/A N/A 240% 2002 5.73 (25.78) 38 1.83 (.90) N/A N/A 150 2003 7.23 26.18 48 1.99 (.35) N/A N/A 49 2004 7.83 8.30 49 1.85 (.30) N/A N/A 39 2005 8.70 11.35 48 1.79 .41 N/A N/A 60 2006 (b) 9.06 4.26 48 1.89+ (.32)+ N/A N/A 36 Class B - ------- 2001 7.58 (26.12) 13 2.45 (1.05) N/A N/A 240 2002 5.59 (26.25) 9 2.53 (1.60) N/A N/A 150 2003 7.00 25.22 11 2.69 (1.05) N/A N/A 49 2004 7.53 7.57 11 2.55 (1.00) N/A N/A 39 2005 8.33 10.68 9 2.49 (.29) N/A N/A 60 2006 (b) 8.65 3.84 9 2.59+ (1.02)+ N/A N/A 36 - ----------------------------------------------------------------------------------------------------------- Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- GLOBAL FUND - ----------- Class A - ------- 2001 $8.11 $(.01) $(2.13) $(2.14) $ -- $ .76 $ .76 2002 5.21 (.01) (.96) (.97) -- -- -- 2003 4.24 (.01) .93 .92 -- -- -- 2004 5.16 (.01) .78 .77 -- -- -- 2005 5.93 -- 1.13 1.13 -- -- -- 2006 (b) 7.06 (.01) .56 .55 .02 -- .02 Class B - ------- 2001 7.80 (.06) (2.03) (2.09) -- .76 .76 2002 4.95 -- (.95) (.95) -- -- -- 2003 4.00 (.04) .88 .84 -- -- -- 2004 4.84 (.05) .73 .68 -- -- -- 2005 5.52 (.04) 1.04 1.00 -- -- -- 2006 (b) 6.52 (.04) .52 0.48 -- -- -- - ----------------------------------------------------------------------------------------------------- * Calculated without sales charges. ** Net of expenses waived or assumed by FIMCO (Note 3). + Annualized ++ Prior to October 1, 2001, the Total Return Fund, Value Fund and Growth & Income Fund did not amortize premiums on debt securities. The per share data and ratios prior to 2001 have not been restated. The cumulative effect of this accounting change had no impact on the net assets of the Funds. +++ Prior to December 31, 2002, known as Utilities Income Fund. (a) For the period October 25, 2000 (commencement of operations) to September 30, 2001. (b) For the period October 1, 2005 to March 31, 2006. See notes to financial statements - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- GLOBAL FUND - ----------- Class A - ------- 2001 $5.21 (28.87)% $234 1.77% (.21)% N/A N/A 116% 2002 4.24 (18.62) 173 1.87 (.35) N/A N/A 125 2003 5.16 21.70 192 1.98 (.19) N/A N/A 112 2004 5.93 14.92 209 1.86 (.13) N/A N/A 105 2005 7.06 19.06 239 1.78 .05 N/A N/A 104 2006 (b) 7.59 7.74 257 1.84+ (.40)+ N/A N/A 58 Class B - ------- 2001 4.95 (29.42) 18 2.47 (.91) N/A N/A 116 2002 4.00 (19.19) 14 2.57 (1.05) N/A N/A 125 2003 4.84 21.00 15 2.68 (.89) N/A N/A 112 2004 5.52 14.05 15 2.56 (.83) N/A N/A 105 2005 6.52 18.12 14 2.48 (.65) N/A N/A 104 2006 (b) 7.00 7.36 15 2.54+ (1.10)+ N/A N/A 58 - ----------------------------------------------------------------------------------------------------------- Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Trustees of First Investors Equity Funds We have audited the accompanying statements of assets and liabilities, including the portfolios of investments of the Total Return Fund, Value Fund, Blue Chip Fund, Growth & Income Fund, All-Cap Growth Fund, Mid-Cap Opportunity Fund, Special Situations Fund, Focused Equity Fund and Global Fund (each a series of First Investors Equity Funds), as of March 31, 2006, the related statements of operations, the statement of changes in net assets, and the financial highlights for each of the periods indicated thereon. These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Funds' internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds' internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of March 31, 2006, by correspondence with the custodian and brokers. Where brokers have not replied to our confirmation requests, we have carried out other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Total Return Fund, Value Fund, Blue Chip Fund, Growth & Income Fund, All-Cap Growth Fund, Mid-Cap Opportunity Fund, Special Situations Fund, Focused Equity Fund and Global Fund as of March 31, 2006, and the results of their operations, changes in their net assets, and their financial highlights for the periods presented, in conformity with accounting principles generally accepted in the United States of America. Tait, Weller & Baker LLP Philadelphia, Pennsylvania May 2, 2006 FIRST INVESTORS EQUITY FUNDS Trustees - ----------------------- Charles R. Barton, III Stefan L. Geiringer Robert M. Grohol Kathryn S. Head Arthur M. Scutro, Jr. James M. Srygley John T. Sullivan Robert F. Wentworth Officers - ----------------------- Kathryn S. Head President Larry R. Lavoie Chief Compliance Officer Joseph I. Benedek Treasurer Mark S. Spencer Assistant Treasurer Carol Lerner Brown Assistant Secretary FIRST INVESTORS EQUITY FUNDS Shareholder Information - ----------------------- Investment Adviser Custodian (Global Fund only) First Investors Management Company, Inc. Brown Brothers Harriman & Co. 95 Wall Street 40 Water Street New York, NY 10005 Boston, MA 02109 Subadviser Transfer Agent (Special Situations Fund only) Administrative Data Management Corp. Paradigm Capital Management, Inc. Raritan Plaza I - 8th Floor Nine Elk Street Edison, NJ 08837-3620 Albany, NY 12207 Independent Registered Subadviser Public Accounting Firm (All-Cap Growth Fund, Tait, Weller & Baker LLP Focused Equity Fund and 1818 Market Street Global Fund only) Philadelphia, PA 19103 Wellington Management Company, LLP 75 State Street Legal Counsel Boston, MA 02109 Kirkpatrick & Lockhart Nicholson Graham LLP Underwriter 1800 Massachusetts Avenue, N.W. First Investors Corporation Washington, DC 20036 95 Wall Street New York, NY 10005 Custodian The Bank of New York One Wall Street New York, NY 10286 It is the Funds' practice to mail only one copy of their annual and semi-annual reports to all family members who reside in the same household. Additional copies of the reports will be mailed if requested by any shareholder in writing or by calling 800-423-4026. The Funds will ensure that separate reports are sent to any shareholder who subsequently changes his or her mailing address. This report is authorized for distribution only to existing shareholders, and, if given to prospective shareholders, must be accompanied or preceded by the Trust's prospectus. The Statement of Additional Information includes additional information about the Trust's trustees and is available without charge, upon request in writing or by calling 800-423-4026. A description of the policies and procedures that the Funds use to vote proxies relating to a portfolio's securities is available, without charge, upon request by calling toll free 800-423-4026 or can be viewed online or downloaded from the EDGAR database on the Securities and Exchange Commission's ("SEC") internet website at http://www.sec.gov. In addition, information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, is available, without charge, upon request in writing or by calling 800-423-4026 and on the SEC's internet website at http://www.sec.gov. The Funds file their complete schedule of portfolio holdings with the SEC on Form N-Q for the first and third quarters of each fiscal year. The Funds' Form N-Q is available on the SEC's website at http://www.sec.gov; and may also be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330. The schedule of portfolio holdings is also available, without charge, upon request in writing or by calling 800-423-4026. NOTES NOTES NOTES NOTES Item 2. Code of Ethics 		 Not applicable Item 3. Audit Committee Financial Expert 		 Not applicable Item 4. Principal Accountant Fees and Services 		 Not applicable Item 5. Audit Committee of Listed Registrants 		 Not applicable Item 6. Schedule of Investments 		 Schedule of investments is included as part of 		 the report to stockholders filed under Item 1 		 of this Form. Item 7. Disclosure of Proxy Voting Policies & Procedures for Closed-End Management Investment Companies 		 Not applicable Item 8. Portfolio Managers of Closed-End Management Investment Companies 		 Not applicable Item 9. Purchases of Equity Securities by Closed-End Management 	 Investment Companies and Affiliated Purchasers 		 Not applicable Item 10. Submission of Matters to a Vote of Security Holders There were no material changes to the procedure by which shareholders may recommend nominees to the Registrant's Board of Trustees. Item 11. Controls and Procedures (a)	The Registrant's Principal Executive Officer and Principal Financial Officer have concluded that the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are effective, based on their evaluation of these disclosure controls and procedures as of a date within 90 days of the filing date of this report. (b)	There were no changes in the Registrant's internal control over financial reporting that occurred during the 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)	Code of Ethics - Not applicable (a)(2)	Certifications pursuant to Section 302 of the Sarbanes-Oxley Act 	of 2002 - Filed herewith (b)	Certifications pursuant to 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. First Investors Equity Funds (Registrant) By /S/ KATHRYN S. HEAD 	 Kathryn S. Head 	 President and Principal Executive Officer Date: June 7, 2006 	Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. First Investors Equity Funds (Registrant) By /S/ JOSEPH I. BENEDEK 	 Joseph I. Benedek 	 Treasurer and Principal Financial Officer Date: June 7, 2006