UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------
FORM N-CSR
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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
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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
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GLOBAL FUND
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Class A
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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 -- -- --
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* 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
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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
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Class A
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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
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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