UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-2168
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ACTIVA MUTUAL FUND TRUST
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(Exact name of registrant as specified in charter)
2905 Lucerne Dr. SE, Suite 200
Grand Rapids, Michigan 49546-7116
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(Address of principal executive offices) (Zip code)
Allan D. Engel, President, Secretary, and Treasurer Activa Mutual Fund
2905 Lucerne Dr SE, Suite 200
Grand Rapids, Michigan 49546-7116
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(Name and address of agent for service)
Registrant's telephone number, including area code: (616) 787-6288
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Date of fiscal year end: December 31
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Date of reporting period: June 30, 2004
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREHOLDERS.
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The attached Semiannual Report to Shareholders was mailed on August 30, 2004.
Activa
SEMIANNUAL REPORT
JUNE 30, 2004
ACTIVA MONEY MARKET FUND
Sub-Adviser: JP Morgan Investment
Management, Inc.
ACTIVA INTERMEDIATE BOND FUND
Sub-Adviser: McDonnell Investment
Management, LLC
ACTIVA VALUE FUND
Sub-Adviser: Wellington Management, Co. LLP
ACTIVA GROWTH FUND
Sub-Adviser: State Street Research &
Management Company
ACTIVA INTERNATIONAL FUND
Sub-Adviser: Nicholas-Applegate
Capital Management
A selection of stock, bond, and money market funds, managed by professional
advisers, which are designed to help investors meet their financial goals.
Activa Mutual Funds
ACTIVA Mutual Funds Semiannual Report
Contents
Page
SHAREHOLDER LETTER 1
ACTIVA MONEY MARKET FUND 2
ACTIVA INTERMEDIATE BOND FUND 3
ACTIVA VALUE FUND 4
ACTIVA GROWTH FUND 5
ACTIVA INTERNATIONAL FUND 6
ACTIVA OFFICERS AND TRUSTEES OF THE FUND 7
SCHEDULE OF INVESTMENTS
Activa Money Market Fund 9
Activa Intermediate Bond Fund 10
Activa Value Fund 13
Activa Growth Fund 18
Activa International Fund 22
Page
Statement of Assets and Liabilities 28
Statement of Operations 29
Statement of Changes in Net Assets 30
Notes to Financial Statements 32
Financial Highlights 36
Activa Mutual Funds
2905 Lucerne SE, Suite 200
Grand Rapids, Michigan 49546
(616) 787-6288 (800) 346-2670
www.activafunds.com
SEMIANNUAL REPORT
DEAR SHAREHOLDER:
I am pleased to provide you with the Semi-Annual Report to Shareholders for the
Activa Mutual Funds for the period ended June 30, 2004. The following pages
include the sub-advisers' management discussions and performance reviews for the
Funds.
During first six months of 2004 the U.S. and International stock markets posted
positive returns. Although early during the first quarter of 2004 we saw strong
positive returns, the markets in the second quarter mostly treaded water as
strength in the overall economy was offset by continued turmoil in Iraq,
prospects of rising interest rates and rising energy costs. The Dow Jones
Industrial Average finished the first half of the year up narrowly, 0.87%, and
the Standard & Poor's 500 Index finished stronger with a positive 3.44%, for the
same period. During the first six months the Lehman Brothers Aggregate Bond
Index was generally flat, ending the period up 0.10%, in expectation of any
increasing Federal Funds Rate. The Federal Reserve increased the rate a quarter
of a percent on June 30th as anticipated.
Mutual Fund investors continue to invest during this economic environment, with
net assets increasing 2.3% year to date 2004. Stock-funds have seen the largest
inflows in 2004 as net assets have increased over $200 billion since December of
2003, an increase of 7.2% year-to-date. Taxable Bond Funds grew slightly in the
second quarter, increasing only 0.04%; although, year-to-date taxable bond
assets have seen a net decrease, down 0.4%.
After the strong market recovery in 2003, investors are realizing that 2004 may
not be as robust. Although markets were mainly positive during the first
quarter, the second quarter was much more volatile. While it continues to be
difficult to predict market direction it is as important as ever for investors
to maintain and review their investment objectives and focal point of their
investment programs. Diversification among asset classes and the appropriate mix
of stock and bond investments may help weather market volatility.
Maintaining a diversified investment plan and using dollar cost averaging may
help investors achieve their goals. Dollar cost averaging involves investing a
certain amount of money in the same fund at the same time each month or quarter.
By investing the same dollar amount on a periodic basis in the same fund you may
pay a lower average cost per share. Although dollar cost averaging does not
guarantee a profit, it does encourage discipline, eliminate the need to decide
when to invest, and avoid the temptation to time the market. Activa Mutual Funds
can help you maintain an investment program by establishing an automatic
investment program from your bank account. You can choose the dollar amount
(minimum $50), time periods, and Funds you want to invest in. Call an Activa
Funds Shareholder Representative (1-800-346-2670) to further discuss dollar cost
averaging and how you can establish an automatic investment program.
To help investors determine their personal asset allocation and investment needs
the Activa Funds web-site offers a variety of financial calculators to help
investors develop a plan. Please visit our web site at www.activafunds.com to
access the financial calculators, and learn how you can develop a diversified
portfolio using the Activa Funds.
We here at Activa funds thank you for your support of our Fund family and we
will continue to make it our priority to bring you the highest level of quality
and service.
Sincerely,
/s/ Allan D. Engel
Allan D. Engel
President
ACTIVA Mutual Funds Semiannual Report 1
ACTIVA Money Market Fund -- JP Morgan Investment Management, Inc.
The Activa Money Market Fund, which seeks to provide preservation of principal,
returned 0.16% for the six-month period ended June 30, 2004.
HOW WAS THE FUND MANAGED?
Data released during the first quarter was mixed. On balance, they suggested
that the U.S. economy would continue growing near its trend rate of 4%. Although
corporate profits rose, companies were still reluctant to add new workers.
Consumer spending increased, fueled by tax refunds and the mortgage credit boom.
Core inflation rose slightly but without evidence of a meaningful uptrend. The
Federal Reserve Board indicated that it could be patient in maintaining an
accommodative stance.
By the second quarter, the economy had completed its transition from a
stimulus-dependent to a self-sustaining expansion. The key marker was
accelerated private employment growth, which was accompanied by an upswing in
pre-tax income growth. However, economic growth moderated and inflation
increased. The combination of renormalizing economic conditions and rising
inflation had a major effect on expectations for the Fed's monetary policy. In
June, the Fed raised interest rates by .25% to 1.25%, the first rate hike in
four years. Treasury yields rose and the LIBOR curve steepened as investors
anticipated significantly higher short-term interest rates in coming quarters.
During the first quarter, we targeted a weighted average maturity (WAM) of 70 to
75 days. In February, we extended our WAM by concentrating our purchases in
six-month maturities. We continued to add one- and three-month commercial paper
throughout the quarter to maintain our extended WAM and to keep our cash
positions low. In the second quarter, we maintained a target WAM of 60 to 65
days. In April and again in June, we took advantage of higher rates to purchase
13-month fixed-rate certificates of deposit. During May and June, we bought one-
and three-month commercial paper and increased our allocation to floating rate
notes. Toward the end of June, we purchased one- to two-week commercial paper,
awaiting the outcome of the June 30 Fed meeting.
2 ACTIVA Mutual Funds Semiannual Report
ACTIVA Intermediate Bond Fund-- McDonnell Investment Management, LLC
ECONOMIC REVIEW
The economic environment for the first half of 2004 was characterized by solid
global and US economic growth (with US real GDP expanding at nearly a 4% rate),
commodity price pressures, US budget and trade deficits, weaker US dollar and a
tighter Fed monetary policy. The underlying economic strength coupled with the
commodity price pressures contributed to weakness across the yield curve as
interest rates moved higher in anticipation of tighter monetary policy.
MARKET OVERVIEW
As we entered 2004 the fixed income market was focused on the prospects for
gains in employment in the current economic recovery. In our view, the pace of
job creation would be considered the final piece of the economic strength puzzle
and would determine the magnitude of the potential short-term rate increases by
the Federal Reserve Board. Robust employment growth began to appear late in the
first quarter and carried through the second quarter causing interest rates to
rise and bond prices to fall as expectations for short-term fed funds rate
increases rose.
As a result of the underlying economic strength, the Federal Reserve increased
the Fed Funds target rate to 1.25% at its June meeting. The increase in the
short term Fed Funds rate contributed to an overall flatter yield curve at the
end of the period. The yield difference from 2 year treasuries to 30 year
treasuries decreased from 3.25% as of December 31, 2003 to 2.61% as of June 30,
2004. Overall, the 2-year treasury yield increased from 1.82% on December 31,
2003 to 2.68% on June 30, 2004, while the 30-year treasury yield increased from
5.07% to 5.29% over the same period.
PORTFOLIO STRATEGY AND OVERVIEW
As of June 30, 2004, the Fund had a duration of approximately 4.4 years, which
was comparable to the 4.6 year duration of the Fund's benchmark, the Lehman
Brothers Aggregate Bond Index. With respect to relative sector weightings, the
Fund held overweight positions in the corporate and asset- and mortgage-backed
sectors. We believe the relative yield premiums offered by these sectors remain
attractive and present positive total return opportunities. In addition, we have
underweighted the middle of the yield curve relative to the benchmark in
anticipation of a less steep or flatter yield curve in a rising rate
environment. The Fund generated a total return of -0.23% for the first six
months of 2004, compared to the Bond Index return of +0.10% during the same
period. Detracting from the Fund's performance was the continued underweight in
treasury securities.
OUTLOOK AND SUMMARY
We believe the prospects for continued economic growth and concerns about
underlying price pressures will cause the Fed to continue to firm monetary
policy leading to additional increases in the Fed Funds rate. As of June 30,
2004, the futures market had priced in a year-end Fed Funds rate of
approximately 2.25%, a 1.00% increase from the June 30, 2004 level. While
geopolitical events or other factors certainly could cause the economic strength
to fizzle and short-circuit the anticipated degree of monetary tightening. The
Fed's last Federal Open Market Committee statement highlighted its belief that
monetary policy still would be accommodative at the 1.25% level. The question
for us will be when the Fed feels that the Fed Funds rate has moved to a neutral
stance, appropriately balancing the prospects for sustainable economic growth
and relative stable inflation. The challenge for us remains identifying the key
sectors, yield curve posture and securities that best fit this environment. We
expect to continue to meet these challenges through appropriate risk management
and our disciplined investment style.
ACTIVA Mutual Funds Semiannual Report 3
ACTIVA Value Fund -- Wellington Management Co., LLP
MARKET COMMENT
Broad-based indications of economic strength and continued growth in corporate
profits overshadowed investors' concerns regarding rising inflation, acts of
terrorism, and turmoil in Iraq during the six-month period ended June 30, 2004.
The Federal Reserve raised the target federal funds rate 25 basis points citing
the "solid pace" of output growth and improving labor markets.
All major indexes posted positive returns during the period. Small caps
outperformed large caps, as the Russell 2000 Index gained 7% versus 3% for the
Russell 1000 Index. Value slightly outperformed growth as the Russell 1000 Value
advanced 4% versus 3% for the Russell 1000 Growth. Within the Russell 1000 Value
Index, nine out of ten broad industry sectors posted positive returns. Energy
and Consumer Staples were the best performing sectors, while Consumer
Discretionary was the only sector to post negative results.
FUND REVIEW
The Activa Value Fund recorded positive performance of +2.4% for the six-month
period, but trailed the +3.9% return of the Russell 1000 Value index.
The Sub-Advisor uses fundamental, or "bottom-up," security analysis to focus on
stock selection within industries; rather than making significant sector bets,
industry weights are kept in line with those of the Russell 1000 Value Index. In
addition, the Sub-Adviser uses an internally-developed, quantitative analytical
approach to complement the fundamental research.
The Activa Value Fund underperformed its benchmark during the six-month period,
with the Fund's bottom-up investment approach producing positive
benchmark-relative results in only one of the ten broad market sectors. Stock
selection in the other nine sectors detracted from performance.
Year-to-date, stock selection within the Industrials sector was the biggest
detractor from benchmark-relative returns. Shares of American Power Conversion
fell after the company announced lower-than-expected earnings caused by
increased sales and marketing costs as it sought to boost market share. United
Technologies, an aerospace company, also fell as US government budget pressures
increase and defense programs come under greater scrutiny.
Within Information Technology, semiconductor stocks, Fairchild Semiconductor and
Novellus Systems, underperformed as investors feared that demand growth would
slow and the semiconductor cycle would not be as robust as had been expected.
In addition, relative performance was negatively impacted by the Fund's position
in King Pharmaceuticals. The stock fell on poor earnings due to an inventory
draw down and fears of generic competition.
On the positive side, a number of bank stocks within Financials dampened the
overall negative relative results. Shares of Bank One surged on news that Bank
One and J.P Morgan Chase agreed to merge, establishing the second largest
banking franchise in the United States, based on core deposits. Countrywide
Financial's successful efforts to gain market share and diversify revenues
spurred the shares' outperformance during a period of rising interest rates.
General Growth Properties benefited from strong performance of the Real Estate
industry earlier in the year. Finally, Bank of America continued to benefit from
the acquisition of FleetBoston Financial.
4 ACTIVA Mutual Funds Semiannual Report
ACTIVA Growth Fund -- State Street Research & Management Company
PERFORMANCE SUMMARY
In an environment where the market remained modestly positive, Large-Cap Growth
stocks have faired well, with the Russell 1000(R) Growth Index gaining 2.68% in
the first half of the year. Strong stock selection across several sectors,
including Consumer Discretionary, Conglomerates and Energy, drove relative and
absolute returns higher as the portfolio gained 2.74% during the same period.
Selection in Producer Durables and Technology modestly detracted from return
comparisons.
PORTFOLIO REVIEW
Strong stock-picking across several sectors, including Consumer Discretionary,
Conglomerates and Energy, contributed to the portfolio's performance during the
first half of 2004. Within the Consumer Discretionary sector, double digit gains
by Yahoo!, Harman International and Caesar's Entertainment have bolstered
portfolio returns. Yahoo!, an internet search-engine leader, continues to
generate enormous cash flow as internet advertising has begun to make up a
larger percentage of companies' advertising budgets. Caesar's, along with
portfolio holding International Game Technology, gained as gaming fundamentals
continue to improve. Our Energy exposure continues to be an area of strength
within the portfolio as our bottom-up selection process has led us to overweight
the sector. Year-to-date, the Energy sector has been the Russell 1000 Growth
Index's top performing segment. Additionally, our portfolio holdings within the
sector have faired particularly well, benefiting from elevated commodity prices
as higher coal prices boosted profit margins at Consol Energy and shares of EOG
Resources continue to benefit from high oil and natural gas prices.
In contrast, investor sentiment moved away from several holdings within the
semiconductor area, marginally detracting from the portfolio's performance.
Semiconductor holdings PMC-Sierra, Fairchild and Cypress Semiconductor all
declined since the end of last year. While margin issues at Cypress gave rise to
concerns for its shareholders, order cancellations at Fairchild contributed to a
declining stock-price. Additionally, within the Producer Durables sector, power
protection provider American Power Conversion posted double-digit declines as
the company missed first quarter street earnings estimates.
PORTFOLIO POSITIONING AND OUTLOOK
While equity markets ended the first half of the year modestly positive, markets
were choppy as investors attempted to reconcile strong corporate profits with
concerns surrounding rising interest rates, elevated oil prices and the
sustainability of economic recovery. With companies facing increasingly
difficult year-over-year earnings comparisons, an upcoming presidential election
and rising interest rates, it is likely that markets will remain volatile
through the second half of the year. In this environment, we continue to focus
on stock-specific fundamentals and continue to feel that solid bottom-up stock
selection will be critical in producing above-benchmark returns for our clients
over longer time periods.
As a result of our bottom-up selection process, we enter the second half the
year with an overweight, albeit less than at the end of 2003, in the Consumer
Discretionary sector. Within the Energy sector, we remain overweight as we
continued to believe stocks still offer significant upside, even with their
recent rally. The supply-demand dynamics for coal, natural gas and oil remain
compelling and should provide a boost to those stocks highly levered toward
energy commodity prices. Within Health Care, we continue to favor companies with
strong product pipelines and remain overweight within biotech, but underweight
to large-cap pharmaceutical companies. In Technology, sales of Cypress
Semiconductor, Fairchild Semiconductor and Texas Instruments lessened our
semiconductor weighting to a slight under weight. While we believe that upside
still may exist within the group, we are less confident than a few months ago
and have decreased our exposure to the segment.
Over the past several quarters, our bottom-up approach has resulted in a
portfolio with a cyclical tilt, levered to economic recovery. As the benefits of
recovery have begun to work through the markets and into stock prices, we have
been finding greater opportunity in more stable growth-oriented stocks. As a
result, the "bets" within the portfolio are more broad-based than they have been
over the last few quarters when the portfolio had a cyclical bias.
ACTIVA Mutual Funds Semiannual Report 5
ACTIVA International Fund -- Nicholas Applegate Capital Management
MARKET OVERVIEW
The portfolio has underperformed during the first half of 2004, returning 1.55%
versus the EAFE Index return of 4.86%. Performance has been closer to that of
the growth indexes, indicating that the growth style of the portfolio has been a
contributor to the underperformance.
International equities gained about 4.9% during the first half of 2004.
Virtually all of the appreciation occurred in the first quarter and most of that
came from Japan. The markets were essentially unchanged during the second
quarter as investors were forced to cope with rising interest rates, inflation,
unrelenting geopolitical tensions, fears of a slowdown in China's economy and
skyrocketing oil prices. On the positive side, corporate fundamentals have
continued to improve and economic indicators have steadily progressed. European
equities managed to post small gains during the second quarter. The economic
environment in Europe remains depressed, with high unemployment throughout much
of the region weighing down consumer spending. Companies have, however,
benefited from an increase in demand from outside the euro zone. For example,
German manufacturing orders jumped 2.5% in April with all categories showing
strength and foreign orders far outpacing domestic orders. As expected, net
exports were up, but domestic demand was weak. Unemployment remained unchanged
at 9%.
For the first half, value has outperformed growth in non-US stocks, with the
value benchmarks up about 6% versus growth at about 2%. The best performing
sectors in the first half included Utilities, Consumer Discretionary, Consumer
Staples, Energy and Industrials. Materials, Health Care and Financials lagged.
On a country basis, Japan was the strongest major country in the first half,
with the Japanese market up over 10%. All of Europe's largest economies,
including Switzerland, Germany, France, and the UK underperformed the overall
non-US marketplace.
PORTFOLIO SPECIFICS
Stock selection also detracted from results, particularly true in the Consumer
Discretionary and Industrials sectors. In Consumer Discretionary, poor
performers included George Wimpey, LG Electronics, Matsushita Electronics and
BskyB. Not owning Daimler Chrysler also hurt results as the stock was up 17% in
the second quarter. Industrials that underperformed included: Sumitomo Corp.,
Toppan Printing, Deutsche Post and Adecco. Being overweight Taiwan and S. Korea
hurt as China slowdown fears were a drag on many Asian markets. The portfolio
was a bit underweight in Japan which has also hurt this year.
Over the past several months, we have made several positioning changes in the
portfolio. We took profits from several of our wireless cellular positions. We
also cut back on a variety of technology companies with an emphasis on those in
Asia ex- Japan, reducing the overweight in these securities. These assets have
been redeployed in Consumer Discretionary stocks with an emphasis on European
media names where we believe the earnings growth potential has been overlooked
by the market.
MARKET OUTLOOK
The outlook for international equities remains reasonably optimistic. Corporate
fundamentals and economic growth are improving throughout the major regions of
the world. Asian economies, led by Japan, are now exhibiting broad based
strength in both the consumer and business segments. Leading economic indicators
in the US and Japan have been strong and suggest moderate growth going forward.
In Japan, recent Tankan surveys of business confidence have also been better
than economists had predicted. Unemployment has fallen and household spending is
up. The European economy, however, remains stagnant. Business and consumer
confidence remains weak and unemployment stubbornly high. Germany has been
particularly sluggish. We expect the European central bank to keep interest
rates at their present low levels. We expect the choppy markets seen in the last
several months to continue. Earnings season for international companies
commences in mid July, but expectations are high and the comparisons versus the
latter part of 2003 are more challenging. We expect earnings to remain strong,
but the rate of earnings growth may be peaking.
6 ACTIVA Mutual Funds Semiannual Report
ACTIVA Officers and Trustees of the Fund
The business affairs of the Fund are managed and under the direction of the
Board of Trustees ("Board"). The following information as of June 30, 2004
pertains to the Officers and Trustees of the Fund or the Advisor or both, and
includes their principal occupation during the past five years and their
compensation as Trustee:
NUMBER OF
PORTFOLIOS OTHER
IN FUND DIRECTOR-
TERM OF COMPLEX SHIPS
NAME AND OFFICE/LENGTH PRINCIPAL OCCUPATION OVERSEEN BY HELD BY
ADDRESS AGE OFFICE HELD OF TIME SERVED LAST FIVE YEARS DIRECTOR DIRECTOR
- ------------------------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEES
- -------------------
Allan D. Engel* 52 Trustee, President, Perpetual / 23 Vice President, Real Estate 5 None
2905 Lucerne SE, Secretary and Operations and Secretary-Activa
Suite 200 Treasurer of the Fund; Holdings Corp. Formerly, Sr.
Grand Rapids, President, and Manager, Investments and Real
Michigan Secretary of the Estate, Amway Corporation;
49546 Investment Adviser Director, President and Secretary
of Amway Management Company
(1981-1999); Trustee, Vice
President and Secretary, Amway
Mutual Fund (1981-1999); Vice
President and Assistant
Treasurer, Activa Mutual Fund
Trust (1999-2002).
James J. Rosloniec* 59 Trustee of the Fund Perpetual / 23 President & Chief Operating 5 None
2905 Lucerne SE Officer, JVA Enterprises, LLC.
Suite 200 President, Chief Executive Officer
Grand Rapids, Michigan and Director, Activa Holdings
49546 Corp. Formerly, Vice
President-Audit and Control,
Amway Corporation (1991-2000);
Director, Vice President and
Treasurer of Amway Management
Company (1984-1999); Trustee,
President and Treasurer, Amway
Mutual Fund, (1981-1999);
President and Treasurer, Activa
Mutual Fund Trust (1999-2002).
ADVISORY TRUSTEE
- ----------------
Joseph E. Victor, Jr. 56 Advisory Trustee of Perpetual / 3 President and Chief Executive 5 None
2905 Lucerne SE, the Fund Officer, Marker Net, Inc. (Crown
Suite 200 Independent Business Owner
Grand Rapids, affiliated with Quixtar, Inc.)
Michigan 49546
DISINTERESTED TRUSTEES
- ----------------------
Donald H. Johnson 73 Trustee of the Fund Perpetual / 11 Retired, Former Vice 5 None
2905 Lucerne SE, President-Treasurer,
Suite 200 SPX Corporation.
Grand Rapids,
Michigan 49546
Walter T. Jones 62 Trustee of the Fund Perpetual / 12 Retired, Former Senior Vice 5 None
936 Sycamore Ave. President-Chief Financial
Holland, Michigan Officer, Prince Corporation.
49424
Richard E. Wayman 69 Trustee of the Fund Perpetual / 6 Retired, Former Finance 5 None
24578 Rutherford Director, Amway Corporation.
Ramona, California
92065
ACTIVA Mutual Funds Semiannual Report 7
ACTIVA Officers and Trustees of the Fund continued
The following table summarizes Trustee compensation which was paid by Activa
Asset Management LLC during the six month period ended June 30, 2004 pursuant to
the Administration Agreement.
PENSION OR
RETIREMENT
BENEFITS
ACCRUED AS ESTIMATED ANNUAL TOTAL
NAME OF PERSON, TRUSTEE PART OF BENEFITS COMPENSATION
POSITION COMPENSATION FUND EXPENSES UPON RETIREMENT PAID TO TRUSTEES
INTERESTED TRUSTEES
Allan D. Engel*
Trustee $5,000 -0- -0- $5,000
James J. Rosloniec* $5,000 -0- -0- $5,000
Trustee
ADVISORY TRUSTEE
Joseph E. Victor, Jr. $5,000 -0- -0- $5,000
Advisory Trustee
DISINTERESTED TRUSTEES
Donald H. Johnson $5,000 -0- -0- $5,000
Trustee
Walter T. Jones $5,000 -0- -0- $5,000
Trustee
Richard E. Wayman $5,000 -0- -0- $5,000
Trustee
*Mssrs. Engel and Rosloniec are interested persons of the Fund. In addition, Mr.
Engel is an officer of the Fund, Investment Adviser and of Activa Holdings
Corp., which controls the Investment Adviser. Mr. Rosloniec is also an officer
of Activa Holdings Corp., and of JVA Enterprises, LLC, which may be deemed to
control Activa Holdings Corp.
The Officers serve without compensation from the Fund. Fees paid to all Trustees
during the six month period ended June 30, 2004, amounted to $30,000.
The Fund's Statement of Additional Information contains additional information
about the Fund's Trustees. It is available, without charge, by writing or
telephoning the Fund.
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available, without charge,
upon request, by calling (800) 346-2670 and it also appears in the Fund's
Statement of Additional Information which can be found on the Securities and
Exchange Commission's website at http://www.sec.gov.
8 ACTIVA Mutual Funds Semiannual Report
ACTIVA Schedule of Investments
MONEY MARKET FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
CERTIFICATES OF DEPOSIT 23.5%
CREDIT SUISSE FIRST BOSTON, FRN, 7/12/04 1,000,000 $ 1,000,070
ABN-AMRO BANK N.V.OSIT MODEL, CD, 1.11%, 9/7/04 500,000 500,000
BARCLAYS BANK PLC, CD, 1.09%, 8/25/04 1,000,000 1,000,004
SANTANDER CENTRAL HISPANO, CD, 1.12%, 8/11/04 1,000,000 1,000,022
BNP PARIBAS, CD, 1.36%, 9/10/04 1,000,000 1,000,000
COD ROYAL BANK OF SCOTLAND, FRN, 9/27/04 1,000,000 999,740
ROYAL BANK OF SCOTLAND GROUP, CD, 2.47%, 7/15/05 300,000 299,944
SOCIETE GENERALE, CD, 2.48%, 7/15/05 500,000 499,846
WEST LB AG, 1.27%, 10/14/04 1,000,000 1,000,312
-------------
7,299,938
-------------
COMMERCIAL PAPER 64.4%
DANSKE CORPORATION, DN, 1.07%, 9/17/04 500,000 498,841
MACQUARIE BANK LTD., DN, 1.23%, 7/21/04 1,000,000 999,317
NBNZ INTERNATIONAL, DN, 1.12%, 7/23/04 482,000 481,670
WELLS FARGO BANK MINNESOTA, FRN, 1.03%, 2/14/05 1,000,000 1,000,000
DEUTSCHE BANK AG, FRN, 10/8/04 1,000,000 1,000,000
AMSTERDAM FUNDING, DN, 1.24%, 7/22/04 1,000,000 999,277
AQUINAS FUNDING LLC, DN, 1.09%, 7/14/04 1,000,000 999,606
ATLANTIS ONE FUNDING, DN, 1.07%, 10/1/04 1,000,000 997,266
CBA (DELAWARE) FINANCE, INC., DN, 1.09%, 7/20/04 747,000 746,570
CANTABRIC FINANCE LLC, DN, 1.52%, 9/27/04 1,000,000 996,284
GEMINI SECURITIZATION CORP., DN, 1.45%, 7/1/04 499,000 499,000
GOVCO INCORPORATED, DN, 1.16%, 8/10/04 500,000 499,356
GRAMPIAN FUNDING, DN, 1.16%, 10/6/04 1,000,000 996,874
HSH NORBANK, DN, 1.21%, 7/14/04 1,000,000 999,561
K2 (USA) LLC, DN, 1.09%, 7/7/04 500,000 499,909
K2 (USA) LLC, DN, 1.09%, 8/17/04 500,000 499,288
LINKS FINANCE LLC, DN, 1.06%, 6/10/05 1,000,000 999,812
NBNZ INTERNATIONAL, DN, 1.26%, 9/1/04 1,000,000 997,821
NEW CENTER ASSET TRUST, DN, 1.46%, 7/1/04 1,000,000 1,000,000
SILVER TOWER US FUNDING, DN, 1.11%, 8/11/04 1,000,000 998,736
WEST LB AG, DN, 1.29%, 9/7/04 500,000 498,782
RWE AG, DN, 1.14%, 7/6/04 1,005,000 1,004,841
NATIONWIDE BUILDING SOCIETY, DN, 1.09%, 8/20/04 800,000 798,789
NETWORK RAIL CP FINANCE, DN, 1.24%, 10/22/04 1,000,000 996,092
-------------
20,007,692
-------------
FEDERAL HOME LOAN BANK 2.4%
FHLB, FRN, 9/20/04 750,000 749,886
-------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION 9.7%
FANNIE MAE, FRN, 7/30/04 1,000,000 999,940
FANNIE MAE, FRN, 9/10/04 1,000,000 999,887
FANNIE MAE, FRN, 9/10/04 1,000,000 1,000,000
-------------
2,999,827
-------------
TOTAL SHORT TERM OBLIGATIONS - 100% (Cost $31,057,343) $ 31,057,343
=============
ACTIVA Mutual Funds Semiannual Report 9
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments
INTERMEDIATE BOND FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
US TREASURY NOTES 10.0%
U.S. TREASURY NOTES, 6.875%, 5/15/06 2,500,000 $ 2,691,993
U.S. TREASURY NOTES, 2.625%, 11/15/06 14,000,000 13,912,500
-------------
16,604,493
-------------
US TREASURY BONDS 3.3%
U.S. TREASURY BONDS, 8.125%, 8/15/19 2,600,000 3,406,000
U.S. TREASURY BONDS, 5.25%, 11/15/28 725,000 710,529
US TREASURY INFLATION INDEX BOND (TIP), 3.88%, 4/15/29 900,000 1,312,754
-------------
5,429,283
-------------
US TREASURY STRIPS - PRINCIPAL ONLY 0.7%
STRIP PRINC, 5/15/18 2,340,000 1,117,373
-------------
FEDERAL HOME LOAN MORTGAGE 19.3%
FEDERAL GOVT LOAN MORTGAGE CORP., 5.00%, 7/1/34 3,250,000 3,137,264
FREDDIE MAC GOLD, 5.50%, 12/1/32 1,402,990 1,402,255
FREDDIE MAC, 8.00%, 3/1/30 621,317 674,905
FREDDIE MAC, 6.50%, 12/15/22 1,568,746 1,577,087
FREDDIE MAC, 4.25%, 6/15/05 7,000,000 7,140,000
FREDDIE MAC, 5.50%, 5/15/28 3,000,000 3,042,086
FREDDIE MAC, 5.00%, 4/15/18 2,250,000 2,201,911
FREDDIE MAC, 4.50%, 4/15/26 2,500,000 2,485,839
FREDDIE MAC, 4.00%, 5/15/23 4,750,000 4,790,882
FREDDIE MAC, 4.00%, 2/15/21 2,500,000 2,522,324
FREDDIE MAC, 4.00%, 5/15/24 3,000,000 3,012,180
-------------
31,986,733
-------------
FEDERAL NATIONAL MORTGAGE ASSOCIATION 19.1%
FANNIE MAE, 7.125%, 1/15/30 4,500,000 5,259,015
FANNIE MAE, 6.5%, 9/1/29 351,739 367,127
FANNIE MAE, 4.50%, 9/1/18 3,719,975 3,642,863
FANNIE MAE CL, 5.00%, 12/1/33 2,593,870 2,514,672
FANNIE MAE, 6.00%, 4/1/14 310,659 324,735
FANNIE MAE, 6.00%, 2/1/29 471,354 483,727
FANNIE MAE, 6.00%, 1/1/29 643,198 660,082
FANNIE MAE, 6.50%, 3/1/29 505,626 528,060
FANNIE MAE, 6.50%, 3/1/29 444,360 464,076
FANNIE MAE, 6.00%, 4/1/14 631,195 659,397
FANNIE MAE CL, 6.50%, 7/1/32 3,941,110 4,107,820
FANNIE MAE CL, 6.50%, 9/1/18 2,563,420 2,710,467
FANNIE MAE, 6.50%, 10/1/31 1,032,492 1,077,013
FANNIE MAE, 6.50%, 5/1/32 1,427,018 1,487,382
FANNIE MAE CL, 5.50%, 2/1/33 1,449,429 1,447,134
FANNIE MAE CL, 5.50%, 4/1/33 1,046,407 1,043,085
FANNIE MAE CL, 5.00%, 8/1/33 3,776,536 3,661,227
FANNIE MAE CL, 5.00%, 6/1/34 1,250,000 1,209,312
-------------
31,647,194
-------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION 8.1%
GOVERNMENT NATIONAL MORTGAGE ASSOC., 5.00%, 8/15/33 1,835,926 1,782,914
GOVERNMENT NATIONAL MORTGAGE ASSOC., 6.00%, 12/15/31 1,198,565 1,231,481
10 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (CONTINUED) 8.1%
GOVERNMENT NATIONAL MORTGAGE ASSOC., 7.00%, 11/15/31 630,007 $ 669,869
GOVERNMENT NATIONAL MORTGAGE ASSOC., 6.00%, 10/15/32 2,141,095 2,198,012
GOVERNMENT NATIONAL MORTGAGE ASSOC., 6.50%, 5/15/29 1,074,329 1,125,016
GOVERNMENT NATIONAL MORTGAGE ASSOC., 7.00%, 12/15/28 382,552 407,296
GOVERNMENT NATIONAL MORTGAGE ASSOC., 7.00%, 9/15/29 380,879 405,160
GOVERNMENT NATIONAL SINGLE FAMILY, 6.50%, 8/15/31 1,881,749 1,969,518
GOVERNMENT NATIONAL SINGLE FAMILY, 7.00%, 12/15/29 1,064,656 1,132,930
GOVERNMENT NATIONAL MORTGAGE ASSOC., 4.50%, 4/15/18 2,499,967 2,454,348
-------------
13,376,544
-------------
CORPORATE BONDS- 38.4%
AUTOMOTIVE 0.9%
FORD MOTOR CREDIT CO., 7.00%, 10/1/13 900,000 910,125
GENERAL MOTORS, 8.375%, 7/15/33 550,000 583,688
-------------
1,493,813
-------------
BANKING 7.2%
BANK OF AMERICA CORP., 3.875%, 1/15/08 1,500,000 1,498,800
FIRST DATA CORPORATION, 4.70%, 11/1/06 1,750,000 1,807,452
LEHMAN BROTHERS HOLDINGS, INC., 8.25%, 6/15/07 1,750,000 1,969,147
MELLON CAP II, 7.995%, 1/15/27 2,040,000 2,263,625
NATIONAL RURAL UTIL., 8.00%, 3/1/32 1,500,000 1,857,374
WELLS FARGO & CO., 5.90%, 5/21/06 2,500,000 2,628,125
-------------
12,024,523
-------------
BANKING AND FINANCIAL SERVICES 1.1%
GREENPOINT FINL., 3.20%, 6/6/08 1,900,000 1,821,950
-------------
BROADCASTING 2.0%
CLEAR CHANNEL, 5.00%, 3/15/12 1,250,000 1,218,078
COMCAST CORP., 6.50%, 1/15/15 1,000,000 1,038,423
LIBERTY MEDIA, 5.70%, 5/15/13 1,000,000 986,812
-------------
3,243,313
-------------
COMMERCIAL SERVICES 1.9%
ARAMARK SERVICES, INC., 7.00%, 7/15/06 1,550,000 1,652,688
CENDANT CORP., 7.375%, 1/15/13 1,300,000 1,452,369
-------------
3,105,057
-------------
DIVERSIFIED 1.0%
GENERAL ELECTRIC CAP. CORP., 3.125%, 4/1/09 1,725,000 1,638,750
-------------
ELECTRIC UTILITY 4.9%
AMERICAN ELECTRIC POWER, 5.375%, 3/15/10 1,150,000 1,176,415
ENTERGY GULF STS, 6.00%, 12/1/12 1,600,000 1,587,824
PACIFIC GAS & ELEC., 4.80%, 3/1/14 1,725,000 1,637,605
PECO ENERGY TRANSITION TRUST, 6.52%, 12/31/10 3,385,000 3,712,901
-------------
8,114,745
-------------
ENTERTAINMENT 1.1%
VIACOM, INC., 5.625%, 5/1/07 1,700,000 1,786,831
-------------
ACTIVA Mutual Funds Semiannual Report 11
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERMEDIATE BOND FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
FINANCIAL SERVICES 8.5%
CIT GROUP, INC., 7.375%, 4/2/07 1,800,000 $ 1,970,496
CAPITAL ONE BANK, 4.875%, 5/15/08 1,250,000 1,264,544
COUNTRYWIDE HOME LOAN, 5.50%, 2/1/07 2,500,000 2,613,020
DETROIT EDISON SECURITIZATION FUNDING LLC, 6.19%, 3/1/13 500,000 539,706
GENERAL MOTORS ACCEPT. CORP., 6.125%, 8/28/07 800,000 835,359
GOLDMAN SACHS CAPITAL I, 6.345%, 2/15/34 1,650,000 1,554,445
INTERNATIONAL LEASE FIN., 5.875%, 5/1/13 1,500,000 1,540,491
PSE&G TRANSITION FUNDING LLC, 6.45%, 3/15/13 1,450,000 1,586,822
VANDERBILT MORTGAGE FINANCE, 7.82%, 11/7/17 2,198,551 2,264,540
-------------
14,169,423
-------------
FOOD PRODUCTS 0.6%
KROGER CO., 5.50%, 2/1/13 1,000,000 998,942
-------------
FOREST PRODUCTS 0.7%
WEYERHAEUSER CO., 7.375%, 3/15/32 1,100,000 1,199,865
-------------
HEALTH CARE 1.0%
AETNA, INC., 7.375%, 3/1/06 1,500,000 1,599,375
-------------
OIL & EXPLOR PROD & SER 1.2%
PEMEX PROJECT FUNDING MASTER TR, 8.50%, 2/15/08 1,000,000 1,105,000
TRANSOCEAN SEDCO RIG, 7.375%, 4/15/18 750,000 847,411
-------------
1,952,411
-------------
PRINTING & PUBLISHING 1.0%
NEW AMERICA HOLDINGS, 7.375%, 10/17/08 1,595,000 1,757,146
-------------
RAILROADS 0.7%
BRIT. SKY BROADCA. BSY, 8.20%, 7/15/09 1,000,000 1,153,375
-------------
REAL ESTATE 0.6%
PULTE HOMES, INC., 6.375%, 5/15/33 1,100,000 1,012,000
-------------
TRANSPORTATION & SHIPPING 1.0%
FEDEX CORP., 6.875%, 2/15/06 1,500,000 1,589,317
-------------
TELECOMMUNICATIONS 3.0%
AOL TIME WARNER, 7.625%, 4/15/31 750,000 814,024
DEUTSCHE TELEKOM INT. FIN., 8.50%, 6/15/10 1,000,000 1,169,950
FRANCE TELECOM, 8.50%, 3/1/11 800,000 1,006,876
SPRINT CAPITAL CORP., 8.75%, 3/15/32 750,000 876,465
VERIZON GLOBAL FDG. CORP., 7.75%, 6/15/32 1,000,000 1,127,790
-------------
4,995,105
-------------
TOTAL CORPORATE BONDS 63,655,941
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS 1.1%
AMERICAN GENERAL FINANCE, 4.50%, 11/15/07 1,800,000 1,829,758
-------------
TOTAL FIXED INCOME - 100% (Cost $165,998,542) $ 165,647,319
=============
12 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments
VALUE FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
US TREASURY BILLS - 0.2% 0.2%
U.S. TREASURY BILLS 7/15/04 180,000 $ 179,919
-------------
TOTAL US TREASURY BILLS (Cost $179,935) 179,919
-------------
COMMON STOCKS - 99.8%
AEROSPACE 2.6%
UNITED TECHNOLOGIES 31,436 2,875,765
-------------
AUTOMOTIVE 0.9%
FORD MOTOR COMPANY 39,800 622,870
GENERAL MOTORS 8,800 409,992
-------------
1,032,862
-------------
AUTOMOTIVE PARTS & EQUIPMENT 0.2%
DANA CORP. 10,148 198,901
-------------
BANKING 16.6%
BANK OF AMERICA CORP. 67,865 5,742,736
CITIGROUP, INC. 121,672 5,657,748
COMERICA, INC. 19,160 1,051,501
HIBERNIA CORP. 52,319 1,271,352
KEYCORP 43,900 1,312,171
MBNA CORPORATION 19,600 505,484
NATIONAL CITY CORP. 12,800 448,128
SUN TRUST BANKS, INC. 8,600 558,914
UNIONBANCAL CORPORATION 26,609 1,500,748
WACHOVIA CORP. 10,843 482,513
-------------
18,531,295
-------------
BANKING & FINANCIAL SERVICES 1.3%
UBS AG-REGISTERED 20,172 1,433,422
-------------
BEVERAGES - DOMESTIC 0.9%
COCA-COLA COMPANY 7,100 358,408
COCA-COLA ENTERPRISES 23,500 681,265
-------------
1,039,673
-------------
BROADCASTING 1.2%
COX COMMUNICATIONS *47,400 1,317,246
-------------
BUILDING PRODUCTS 0.5%
SHERWIN-WILLIAMS & CO. 12,700 527,685
-------------
CHEMICALS 1.0%
PPG INDUSTRIES, INC. 5,000 312,450
ROHM & HAAS COMPANY 18,026 749,521
-------------
1,061,971
-------------
ACTIVA Mutual Funds Semiannual Report 13
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
VALUE FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
COMMERCIAL SERVICES 0.3%
CENDANT CORP. 14,812 $ 362,598
-------------
COMPUTER SOFTWARE 2.6%
DST SYSTEMS, INC. *7,000 336,630
MICROSOFT CORP. 90,000 2,570,400
-------------
2,907,030
-------------
COMPUTERS 0.4%
CITADEL BROADCASTING CORP. *33,800 492,466
-------------
CONSTRUCTION - DOMESTIC 0.6%
CENTEX CORPORATION 6,200 283,650
PULTE CORPORATION 7,900 411,037
-------------
694,687
-------------
CONSUMER GOODS & SERVICES 0.6%
COLGATE-PALMOLIVE 5,300 309,785
GILLETTE CO. 9,665 409,796
-------------
719,581
-------------
COSMETICS 0.7%
KIMBERLY-CLARK CORP. 11,200 737,856
-------------
DEFENSE 1.2%
GENERAL DYNAMICS 13,022 1,293,085
-------------
ELECTRIC UTILITY 4.6%
AMEREN CORPORATION 13,100 562,776
AMERICAN ELECTRIC POWER 23,400 748,800
CINERGY CORP. 12,764 485,032
ENTERGY CORP. 26,500 1,484,265
EXELON CORP. 53,960 1,796,328
-------------
5,077,201
-------------
ELECTRICAL & ELECTRONIC 0.4%
PUBLIC SERVICE ENTERPRISE GROUP, INC. 11,800 472,354
-------------
ELECTRICAL EQUIPMENT 3.6%
FAIRCHILD SEMICONDUCTOR INT'L. *14,669 240,132
GENERAL ELECTRIC & CO. 118,500 3,839,400
-------------
4,079,532
-------------
ELECTRONICS 2.2%
MOTOROLA, INC. 100,464 1,833,468
NATIONAL SEMICONDUCTOR CORP. *7,600 167,124
TEKTRONIX, INC. 12,000 408,240
-------------
2,408,832
-------------
14 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
VALUE FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
ENTERTAINMENT 0.5%
FOX ENTERTAINMENT GRP., INC. -A *19,900 $ 531,330
-------------
ENVIRONMENTAL SERVICES 0.2%
WASTE MANAGEMENT, INC. 8,800 269,720
-------------
FINANCIAL SERVICES 9.0%
AMBAC FINANCIAL GROUP, INC. 4,500 330,480
CAPITAL ONE FINANCIAL 17,538 1,199,249
COUNTRYWIDE CREDIT IND., INC. 16,360 1,149,290
FREDDIE MAC 19,557 1,237,958
FANNIE MAE 8,800 627,968
GOLDEN WEST FINANCIAL CORP. 16,823 1,789,126
ISTAR FINANCIAL, INC. 14,900 596,000
MERRILL LYNCH & CO. 31,064 1,676,835
MORGAN STANLEY DEAN WITTER DISCOVERY 27,833 1,468,747
-------------
10,075,653
-------------
HOME BUILDERS 1.8%
D.R. HORTON, INC. 6,600 187,440
KING PHARMACEUTICALS, INC. *52,997 606,816
LENNAR CORPROATION CLASS A 8,400 375,648
STANDARD-PACIFIC CORP. 16,300 803,590
-------------
1,973,494
-------------
INFORMATIONAL SERVICES 2.8%
AFFILIATED COMPUTER SERVICES *11,100 587,634
TIME WARNER *145,723 2,561,810
-------------
3,149,444
-------------
INSURANCE 6.6%
HARTFORD FINANCIAL SERVICES GROUP 25,500 1,752,870
MBIA, INC. 37,212 2,125,549
ST. PAUL COMPANIES 46,001 1,864,881
ACE LIMITED 22,500 951,300
XL CAPITAL LIMITED 8,590 648,201
-------------
7,342,801
-------------
MACHINERY & EQUIPMENT 0.4%
CATERPILLAR, INC. 5,000 397,200
-------------
METALS & MINING 0.4%
ALCOA, INC. 15,010 495,780
-------------
OFFICE/BUSINESS EQUIPMENT & SUPPLIES 2.9%
I.B.M. 26,120 2,302,478
PITNEY BOWES, INC. 13,500 597,375
XEROX CORP. *22,930 332,485
-------------
3,232,338
-------------
ACTIVA Mutual Funds Semiannual Report 15
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
VALUE FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
OIL/GAS - EQUIPMENT & SVCS 2.9%
CONOCOPHILLIPS 35,900 $ 2,738,811
MARATHON OIL CORP. 12,100 457,864
-------------
3,196,675
-------------
OIL & GAS EXPLOR PROD & SER 8.9%
ANADARKO PETROLEUM CORP. 6,200 363,320
CHEVRONTEXACO CORP. 34,628 3,258,841
DEVON ENERGY CORP. 19,842 1,309,572
EXXON MOBIL CORP. 86,464 3,839,866
KERR-MCGEE CORP. 11,700 629,109
UNOCAL CORP. 15,000 570,000
-------------
9,970,708
-------------
OIL & GAS TRANSMISSION 0.9%
UGI CORP. 30,900 991,890
-------------
PAPER PRODUCTS 3.2%
TEMPLE - INLAND, INC. 26,470 1,833,047
WEYERHAEUSER 27,571 1,740,282
-------------
3,573,329
-------------
PHARMACEUTICALS 2.6%
ABBOTT LABORATORIES 17,460 711,670
ICOS CORPORATION *20,400 608,736
MEDCO HEALTH SOLUTIONS *43,562 1,633,575
-------------
2,953,981
-------------
RAILROADS 1.9%
CANADIAN NATIONAL RAILWAY 48,471 2,112,851
-------------
RESTAURANTS 0.8%
MCDONALDS CORP. 35,100 912,600
-------------
RETAIL STORES 2.8%
FEDERATED DEPARTMENT STORES 36,008 1,767,993
FOOT LOCKER, INC. 21,323 519,002
GAP, INC. 34,800 843,900
-------------
3,130,895
-------------
REAL ESTATE INVESTMENT TRUST 0.3%
THORNBURG MORTGAGE, INC. 13,700 369,215
-------------
STEEL 0.7%
PRECISION CASTPARTS CORP. 15,300 836,757
-------------
TOBACCO 2.4%
ALTRIA GROUP, INC. 53,925 2,698,946
-------------
16 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
VALUE FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
TELECOMMUNICATIONS 5.4%
AT&T CORP. NEW 14,357 $ 210,043
CITIZENS COMMUNICATIONS COMPANY *43,405 525,200
LIBERTY MEDIA INTERNATIONAL *9,300 345,030
NEXTEL COMMUNICATIONS, INC., CLASS A *64,700 1,724,902
SPRINT CORP. 102,043 1,795,957
VERIZON COMMUNICATIONS 38,300 1,386,077
-------------
5,987,209
-------------
TOTAL COMMON STOCKS (Cost $101,983,341) 111,466,858
-------------
TOTAL INVESTMENTS - 100% (Cost $102,163,276) $ 111,646,777
=============
*Non-dividend producing as of June 30, 2004
At June 30, 2004, the Fund's open future contracts were as follows:
Number of Opening Face Market
Contracts Contract Type Amount Value
- -------------------------------------------------------------------------------------------------------------------
12 Standard & Poor's 500, 9/17/04 $668,662 $684,240
ACTIVA Mutual Funds Semiannual Report 17
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments
GROWTH FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
COMMERCIAL PAPER - 1.0% 1.0%
GOLDMAN SACHS GROUP, INC., DN, 7/6/04 313,000 $ 312,946
-------------
TOTAL COMMERCIAL PAPER (Cost $312,946) 312,946
-------------
COMMON STOCKS - 99.0%
APPAREL 1.0%
POLO RALPH LAUREN CORPORATION 8,900 306,605
-------------
BANKING 3.1%
CITIGROUP, INC. 12,410 577,065
MBNA CORPORATION 14,500 373,955
-------------
951,020
-------------
BEVERAGES - DOMESTIC 2.9%
COCA-COLA COMPANY 17,600 888,448
-------------
BIOTECHNOLOGY 0.5%
GENENTECH, INC. *2,900 162,980
-------------
BUSINESS SERVICES 1.5%
FIRST DATA CORP. 10,600 471,912
-------------
COMMUNICATIONS EQUIPMENT 2.4%
COMCAST CORPORATION NEW CLASS A SPECIAL *7,700 212,597
QUALCOMM, INC. 7,000 510,860
-------------
723,457
-------------
COMPUTER SOFTWARE 5.1%
MICROSOFT CORP. 36,420 1,040,155
ORACLE CORP. *45,200 539,236
-------------
1,579,391
-------------
COMPUTERS 7.6%
CISCO SYSTEMS, INC. *47,310 1,121,247
INTEL CORP. 38,680 1,067,568
ZEBRA TECHNOLOGIES CORPORATION *1,900 165,300
-------------
2,354,115
-------------
DRUGS 2.9%
IVAX CORP. *6,500 155,935
NOVARTIS AG - ADR 16,610 739,145
-------------
895,080
-------------
DATA PROCESSING & REPRODUCTION 0.5%
ALLIANCE DATA SYSTEMS CORP. *3,900 164,775
-------------
18 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
GROWTH FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
DEFENSE 1.4%
GENERAL DYNAMICS 4,200 $ 417,060
-------------
EDUCATION 1.1%
CAREER EDUCATION CORP. *7,300 332,588
-------------
ELECTRIC UTILITY 1.1%
CONSOL ENERGY, INC. 9,700 349,200
-------------
ELECTRICAL EQUIPMENT 3.4%
GENERAL ELECTRIC & CO. 32,175 1,042,470
-------------
ELECTRONICS 7.4%
EOG RESOURCES, INC. 13,800 823,998
HARMAN INTERNATIONAL INDUSTRIES 3,400 309,400
INTERNATIONAL GAME TECHNOLOGY 15,240 588,264
MILLIPORE CORP. *3,000 169,110
PMC - SIERRA, INC. *12,800 183,680
FLEXTRONICS INTERNATIONAL LTD. 13,200 210,540
-------------
2,284,992
-------------
ENTERTAINMENT 4.0%
CAESARS ENTERTAINMENT, INC. *33,500 502,500
WALT DISNEY COMPANY 21,300 542,937
INTERACTIVECORP *5,805 174,963
-------------
1,220,400
-------------
FINANCIAL SERVICES 5.4%
AMERICAN EXPRESS COMPANY 9,940 510,717
FANNIE MAE 3,200 228,352
GOLDMAN SACH GROUP, INC. 3,000 282,480
PROVIDIAN FINANCIAL CORP. *18,300 268,461
SLM CORP. 9,600 388,320
-------------
1,678,330
-------------
HOUSEHOLD PRODUCTS/WARES 1.3%
MANPOWER INCORPORATED 7,900 401,083
-------------
HOME FURNISHINGS 0.8%
BED, BATH AND BEYOND, INC. *6,200 238,390
-------------
HOTELS & LODGING 1.5%
MARRIOTT INTERNATIONAL CLASS-A 9,200 458,896
-------------
INDUSTRIAL GOODS & SERVICES 2.5%
CLOROX COMPANY 11,000 591,580
EXPEDITORS INTERNATIONAL 3,600 177,876
-------------
769,456
-------------
ACTIVA Mutual Funds Semiannual Report 19
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
GROWTH FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
INFORMATIONAL SERVICES 2.7%
YAHOO!, INC. *23,000 $ 835,590
-------------
INSURANCE 2.1%
AMERICAN INTERNATIONAL GROUP 9,040 644,371
-------------
INTERNET CONTENT 1.0%
JUNIPER NETWORKS, INC. *12,400 304,668
-------------
MEDICAL EQUIPMENT & SUPPLIES 6.8%
ALLERGAN, INC. 2,500 223,800
GUIDANT CORP. 8,300 463,804
JOHNSON & JOHNSON 6,410 357,037
TYCO INTERNATIONAL LTD. 21,700 719,138
ALCON, INC. 4,200 330,330
-------------
2,094,109
-------------
MEDICAL LABS & TESTING SERV. 1.1%
CHARLES RIVER LABORATORIES INTERNATIONAL, INC. *7,000 342,090
-------------
MEDICAL SERVICES 1.4%
UNITEDHEALTH GROUP, INC. 7,100 441,975
-------------
OIL & GAS EXPLOR PROD & SER 1.5%
BURLINGTON RESOURCES 4,800 173,664
NEWFIELD EXPLORATION CO. *5,300 295,422
-------------
469,086
-------------
PHARMACEUTICALS 11.0%
AMGEN, INC. *2,750 150,067
BIOGEN IDEC, INC. *8,200 518,650
CAREMARK RX, INC. *14,000 461,160
CHIRON CORPORATION *5,500 245,520
ELAN CORP PLC - SPONS ADR *7,700 190,498
MONSANTO COMPANY 8,700 334,950
PFIZER, INC. 43,214 1,481,376
-------------
3,382,221
-------------
PRINTING & PUBLISHING 2.4%
THE NEWS CORPORATION, LTD. - SPONSORED ADR 20,900 740,278
-------------
RESTAURANTS 0.8%
STARBUCKS CORP. *5,900 256,532
-------------
20 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
GROWTH FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
RETAIL STORES 4.3%
COACH, INC. *5,020 $ 226,854
NORDSTROM, INC. 6,200 264,182
STAPLES, INC. 11,000 322,410
TARGET CORP. 12,200 518,134
-------------
1,331,580
-------------
SECURITY BROKERS & DEALERS 0.6%
AMERITRADE HOLDING CORP. *15,400 174,790
-------------
SHOES - LEATHER 1.1%
NIKE INCORPORATED - CL B 4,400 333,300
-------------
TECHNOLOGY-SOFTWARE 4.1%
LINEAR TECHNOLOGY 14,200 560,474
SAP AKTIENGESELLSCHAFT 17,000 710,770
-------------
1,271,244
-------------
TELECOMMUNICATIONS 0.7%
RED HAT, INC. *9,800 225,106
-------------
TOTAL COMMON STOCKS (Cost $26,472,495) 30,537,588
-------------
TOTAL INVESTMENTS - 100% (Cost $26,785,441) $ 30,850,534
=============
*Non-dividend producing as of June 30, 2004
ACTIVA Mutual Funds Semiannual Report 21
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments
INTERNATIONAL FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
COMMON STOCKS - 100%
ADVERTISING 0.9%
AEGIS GROUP PLC 159,340 $ 259,344
-------------
AEROSPACE 0.9%
THALES SA 7,337 268,422
-------------
AUTOMOTIVE 1.8%
TOYOTA MOTOR 13,000 526,600
-------------
BANKING 3.9%
HSBC HOLDINGS 33,132 492,696
ROYAL BANK OF SCOTLAND 14,132 406,979
BANCO BILBAO 18,300 244,466
-------------
1,144,141
-------------
BANKING & FINANCIAL SERVICES 4.0%
SOCIETE GENERALE -A 4,187 355,824
SUMITOMO MITSUI FINANCIAL GROUP, INC. 68 466,151
UBS AG- REGISTERED 4,681 329,845
-------------
1,151,820
-------------
BEVERAGES - FOREIGN 1.1%
INTERCONTINENTAL HOTELS 29,779 314,575
-------------
BREWERY 1.1%
INTERBREW (BEL) 9,572 304,537
-------------
BIOTECHNOLOGY 1.6%
CELLTECH GROUP PLC *46,546 463,417
-------------
BROADCASTING 2.5%
BRITISH SKY BROADCASTING 30,700 346,295
TV FRANCAISE 11,899 374,807
-------------
721,102
-------------
BUILDING PRODUCTS 1.8%
HOLDERSBANK REG 9,376 509,826
-------------
BUSINESS SERVICES 2.5%
WPP GROUP PLC 14,282 145,042
VEDIOR N.V. *19,835 289,105
TOPPAN PRINTING 27,000 305,595
-------------
739,742
-------------
CHEMICALS 2.5%
SHIN ETSU CHEM 8,200 293,085
NOVARTIS AG-REG 9,723 428,933
-------------
722,018
-------------
22 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
COMMERCIAL SERVICES 1.0%
BOUYGUES 8,687 $ 290,860
-------------
COMPUTER SOFTWARE 2.2%
SAP AG 2,100 350,030
DASSAULT SYSTEMS SA (FFR) 6,419 297,627
-------------
647,657
-------------
COMPUTERS 1.0%
ASM LITHOGRAPHY HOLDING NV 17,700 302,847
-------------
CONSUMER GOODS & SERVICES 1.3%
FUJI PHOTO FILM 12,000 376,117
-------------
COSMETICS 2.4%
L'OREAL (FFR) 4,723 377,241
CHRISTIAN DIOR 5,116 330,826
-------------
708,067
-------------
CRUISE LINES 1.2%
CARNIVAL PLC 7,184 348,895
-------------
DATA PROCESSING & REPRODUCTION 1.1%
CANON, INC. 6,000 316,180
-------------
ELECTRICAL & ELECTRONIC 1.0%
CREDIT SUISSE 584,000 300,333
-------------
ELECTRONICS 5.8%
ATI TECHNOLOGIES, INC. *13,700 258,382
ELECTROCOMPONENTS PLC 28,154 182,274
KYOCERA CORPORATION 6,000 509,188
LG ELECTRONICS, INC. 8,090 383,671
MATSUSHITA ELECTRIC INDL. CO. 25,000 354,901
-------------
1,688,416
-------------
ENTERTAINMENT 1.4%
PEARSON PLC 33,290 404,488
-------------
FINANCIAL SERVICES 5.3%
MAN GROUP PLC 14,400 372,914
DAIWA SECURITIES 45,000 323,329
MIZUHO FINANCIAL GROUP 101 458,186
ING GROUP 16,800 396,531
-------------
1,550,960
-------------
ACTIVA Mutual Funds Semiannual Report 23
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
FOOD PRODUCTS 4.4%
DIAGEO PLC 37,092 $ 500,125
CADBURY'S SCHWEPPES 35,270 304,300
JPY AJINOMOTO CO., INC. 39,000 469,651
-------------
1,274,076
-------------
FOREIGN AGENCIES 0.8%
GREEK ORGANIZATION OF FOOTBALL PROGNOSTICS 12,380 233,764
-------------
HEALTH CARE 2.4%
ROCHE HOLDINGS 7,006 693,663
-------------
HOME BUILDERS 1.4%
GEORGE WIMPEY PLCITY 60,500 404,855
-------------
HOUSEHOLD PRODUCTS/WARES 1.2%
RECKITT BENSKISER 12,700 359,521
-------------
HOUSEWARES 0.8%
ASAHI GLASS COMPANY 22,000 228,841
-------------
INFORMATIONAL SERVICES 1.0%
TELENOR ASA 41,667 289,742
-------------
INSURANCE 0.9%
AXA 12,400 273,065
-------------
INTERNET CONTENT 0.7%
NHN CORP. 1,932 192,280
-------------
MACHINERY & EQUIPMENT 0.7%
ASM INTERNATIONAL *9,831 203,096
-------------
MANUFACTURING-CONSUMER GOODS 1.1%
CIE FINANCIERE RICHEMONT *12,177 317,940
-------------
MANUFACTURING - MISCELLANEOUS 1.4%
SIEMENS AG (REGD) 5,693 409,696
-------------
MATERIALS 1.1%
WMC RESOURCES LTD. 91,933 315,079
-------------
MERCHANDISING 0.9%
SYNTHES, INC. 2,210 251,898
-------------
NATURAL GAS UTILITY 1.6%
GAZPROM OAO MOSCOW ADR 4,000 114,800
TOKYO GAS CO. LTD. 100,000 354,672
-------------
469,472
-------------
24 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
OIL & GAS EXPLOR PROD & SER 5.6%
SAIPEM S.P.A. 22,600 $ 205,672
TOTAL S.A. 'B'(FFR) 1,671 318,575
LUKOIL HOLDING - ADR 1,600 168,320
ENTE NAZIONALE IDROC (ITL) 12,300 244,225
PETRO-CANADA 4,200 180,593
PETROLEO BRASILEIRO S.A. - ADR 6,500 182,455
PRECISION DRILLING CORP. *6,900 331,269
-------------
1,631,109
-------------
PHARMACEUTICALS 3.3%
MERCK KGAA 8,100 489,787
CHUGAI PHARMACEUTICAL CO. LTD. 21,100 331,056
TEVA PHARMACEUTICAL - SP ADR 1,900 127,851
-------------
948,694
-------------
PRINTING & PUBLISHING 1.2%
NEWS CORP. 39,023 344,686
-------------
PUBLISHING 1.4%
UNITED BUSINESS MEDIA 44,811 412,012
-------------
RETAIL STORES 3.4%
NEXT PLC 12,793 330,137
ESPRIT HOLDINGS LIMITED 63,500 284,129
ITO YOKADO COMPANY 9,000 385,190
-------------
999,456
-------------
RETAIL STORES - GROCERY 0.8%
TESCO ORD SP 49,500 239,008
-------------
REAL ESTATE 0.7%
MITSUBISHI ESTATE CO. LTD. (JP) 16,000 198,543
-------------
TECHNOLOGY 1.4%
UNITED MICROELECTRONICS CORP. LN 538,000 399,822
-------------
TECHNOLOGY-SOFTWARE 1.5%
ERICSSON (LM) TEL. CO. ADR *14,600 436,832
-------------
TOBACCO 1.0%
ALTADIS S.A. 9,687 299,357
-------------
TOYS 1.0%
NINTENDO 2,600 301,425
-------------
ACTIVA Mutual Funds Semiannual Report 25
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/04 (Unaudited)
% OF SHARES OR VALUE
SECURITY DESCRIPTION INVESTMENTS PAR VALUE (NOTE 2)
- ------------------------- ------------ ----------- -------------
TELECOMMUNICATIONS 7.6%
AMERICA MOVIL-SERIES L ADR 9,600 $ 349,152
COLT TELECOM GROUP PLC *146,103 212,628
VODAFONE 124,851 273,399
MM02 PLC *84,122 141,495
TELECOM ITALIA 42,300 239,824
DEUTSCHE TELEKOM *25,543 449,061
ALCATEL ALSTHOM *21,480 331,375
ADVANCED INFO SERVICE PUBLIC COMPANY LIMITED 92,600 206,105
-------------
2,203,039
-------------
TELECOMMUNICATIONS-SERVICES AND EQUIPMENT 1.7%
TELEKOM AUSTRIA AG 20,666 315,548
SK TELECOM 1,000 164,431
-------------
479,979
-------------
WHOLESALE DISTRIBUTION 0.7%
SUMITOMO CORPORATION 28,000 203,235
-------------
TOTAL COMMON STOCKS (Cost $26,607,274) 29,074,549
-------------
TOTAL INVESTMENTS - 100% (Cost $26,607,274) $ 29,074,549
=============
*Non-dividend producing as of June 30, 2004
26 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Schedule of Investments continued
INTERNATIONAL FUND - 6/30/04 (Unaudited)
At June 30, 2004 the breakdown by country was:
% OF MARKET ACTUAL
COUNTRY VALUE MARKET VALUE
- -------- ---------- -------------
Australia 2.3% $ 659,765
Austria 1.1% 315,548
Belgium 1.0% 304,537
Bermuda 1.0% 284,129
Brazil 0.6% 182,455
Canada 1.8% 511,862
China 0.9% 258,382
France 11.1% 3,218,620
Germany 5.8% 1,698,574
Greece 0.8% 233,764
Israel 0.4% 127,851
Italy 2.4% 689,721
Japan 22.0% 6,401,945
Republic of Korea 2.5% 740,383
Mexico 1.2% 349,152
Netherlands 4.1% 1,191,578
Norway 1.0% 289,742
Russian Federation 0.6% 168,320
Spain 1.8% 543,823
Sweden 1.5% 436,832
Switzerland 8.8% 2,532,106
Taiwan 2.4% 700,155
Thailand 0.7% 206,105
United Kingdom 23.8% 6,914,400
United States 0.4% 114,800
------------ -------------
100.0% $ 29,074,549
============ =============
ACTIVA Mutual Funds Semiannual Report 27
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Assets and Liabilities
MONEY MARKET INTERMEDIATE INTERNATIONAL
As of June 30, 2004 (Unaudited) FUND BOND FUND VALUE FUND GROWTH FUND FUND
------------- ------------- ------------- ------------- -------------
ASSETS
Investments at cost $31,057,343 $165,998,542 $102,163,276 $26,785,441 $26,607,274
------------- ------------- ------------- ------------- ------------
Investments at value 31,057,343 165,647,319 111,646,777 30,850,534 29,074,549
Cash 801 4,244,363 1,240,918 152,450 1,034,777
Foreign currency held at value
(cost $13,405) 13,392
Receivables:
Investments sold -- 1,268,328 -- -- 583,614
Investment income 26,805 1,649,182 148,984 19,635 45,963
Other assets 11,389 13,628 20,062 10,941 31,681
------------- ------------- ------------- ------------- ------------
Total Assets 31,096,338 172,822,820 113,056,741 31,033,560 30,783,976
------------- ------------- ------------- ------------- ------------
LIABILITIES
Payables:
Investments purchased -- 3,104,639 297,790 148,398 967,173
Income payable 9,122 -- -- -- --
Advisory fees 27,079 140,736 163,350 52,011 62,520
Transfer agent fees 1,983 244 37,923 825 496
12b-1 fees -- 63,097 38,769 11,285 11,033
Service fees 11,605 63,097 41,547 11,285 11,033
Other liabilities -- 6,319 -- -- 493
Accrued expenses 6,663 12,658 16,243 8,832 15,013
------------- ------------- ------------- ------------- ------------
Total Liabilities 56,452 3,390,790 595,622 232,636 1,067,761
------------- ------------- ------------- ------------- ------------
NET ASSETS $31,039,886 $169,432,030 $112,461,119 $30,800,924 $29,716,215
============= ============= ============= ============= ============
SHARES OUTSTANDING 31,055,397 16,846,404 15,559,344 4,726,993 4,123,336
============= ============= ============= ============= ============
NET ASSET VALUE PER SHARE $1.00 $10.06 $6.52 $7.21
Class A based on net assets of
$104,832,689 and 14,507,884
shares outstanding $7.23
Class R based on net assets of
$7,628,430 and 1,051,460
shares outstanding $7.26
28 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Operations
For the six month period ended June 30, 2004 (Unaudited)
MONEY MARKET INTERMEDIATE INTERNATIONAL
FUND BOND FUND VALUE FUND GROWTH FUND FUND
------------- ------------- ------------- ------------- ------------
INVESTMENT INCOME
Interest $174,083 $4,049,174 $10,406 $3,458 $1,129
Dividends -- -- 1,246,837 111,840 349,518
Miscellaneous 1,134 11,962 13,533 4,504 13,227
------------- ------------- ------------- ------------- ------------
Total Investment Income 175,217 4,061,136 1,270,776 119,802 363,874
------------- ------------- ------------- ------------- ------------
EXPENSES
Advisory fees 54,554 283,318 332,092 104,222 126,477
12b-1 fees -- 127,348 82,867 22,617 22,320
Service fees 23,380 127,348 87,251 22,617 22,320
Shareholder report 2,002 910 25,480 1,274 1,001
Fund accounting fees 19,656 33,619 34,762 20,930 26,804
Audit fees 8,190 8,190 8,190 8,190 8,190
Custodian fees 6,006 9,828 17,290 7,166 29,120
Insurance 598 3,332 2,629 577 558
Legal fees 4,368 4,368 6,188 4,368 4,368
Registration fees 910 3,822 2,466 728 728
Transfer agent fees 4,368 546 70,980 1,729 1,001
Transfer agent fees - Class R -- -- 5,846 -- --
------------- ------------- ------------- ------------- ------------
Total Expenses 124,032 602,629 676,041 194,418 242,887
------------- ------------- ------------- ------------- ------------
Net Investment Income (Loss) 51,185 3,458,507 594,735 (74,616) 120,987
------------- ------------- ------------- ------------- ------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS,
FOREIGN CURRENCY AND FUTURES CONTRACTS
Net realized gain (loss) from
security transactions -- 901,191 15,961,234 2,127,899 3,099,409
Net realized gain (loss) from
foreign currency transactions -- -- -- -- (105,467)
Net realized gain (loss) from
futures contracts -- -- 33,662 -- --
Changes in net unrealized
appreciation or
(depreciation) of investments
and foreign currency -- (4,860,768) (14,081,584) (1,258,205) (2,690,313)
------------- ------------- ------------- ------------- ------------
Net Gain (Loss) from Investments,
Foreign Currency and
Futures Contracts -- (3,959,577) 1,913,312 869,694 303,629
------------- ------------- ------------- ------------- ------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $51,185 ($501,070) $2,508,047 $795,078 $424,616
============= ============= ============= ============= ============
ACTIVA Mutual Funds Semiannual Report 29
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Changes in Net Assets
MONEY MARKET FUND INTERMEDIATE BOND FUND VALUE FUND
PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED
6/30/04 12/31/03 6/30/04 12/31/03 6/30/04 12/31/03
Increase (Decrease) in: (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
-------------------------- --------------------------- --------------------------
NET ASSETS FROM OPERATIONS
Net investment income (loss) $51,185 $158,193 $3,458,507 $7,726,526 $594,735 $1,476,725
Net realized gain (loss) on investments -- -- 901,191 4,210,993 15,994,896 (3,674,758)
Net increase (decrease) in unrealized
appreciation -- -- (4,860,768) (6,211,546) (14,081,584) 33,045,072
----------- ----------- ------------ ------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations 51,185 158,193 (501,070) 5,725,973 2,508,047 30,847,039
DISTRIBUTIONS TO SHAREHOLDERS
Net investment income:
Class A (51,185) (158,193) (3,290,641) (7,160,355) -- (1,438,340)
Class R -- -- -- -- -- (23,052)
Net realized gain from
investment transactions:
Class A -- -- -- (5,392,480) -- --
Class R -- -- -- -- -- --
----------- ----------- ------------ ------------ ------------ ------------
Total distributions to shareholders (51,185) (158,193) (3,290,641) (12,552,835) -- (1,461,392)
CAPITAL SHARE TRANSACTIONS
Net proceeds from sale of shares:
Class A 2,425,011 3,590,366 30,818 168,664 489,612 445,288
Class R -- -- -- -- 5,578,776 637,451
Net asset value of shares issued to
shareholders in reinvestment
of investment income and
realized gain from security
transactions:
Class A 50,968 172,625 3,290,093 12,550,220 -- 1,413,113
Class R -- -- -- -- -- 22,971
Payment for shares redeemed:
Class A (1,947,051) (9,421,279) (60,214) (91,774) (33,251,208) (5,822,991)
Class R -- -- -- -- (214,572) (388,785)
----------- ----------- ------------ ------------ ------------ ------------
Net increase (decrease)
in net assets
derived from capital
share transactions 528,928 (5,658,288) 3,260,697 12,627,110 (27,397,392) (3,692,953)
----------- ----------- ----------- ----------- ----------- -----------
Net Increase (Decrease) in Net Assets 528,928 (5,658,288) (531,014) 5,800,248 (24,889,345) 25,692,694
Net Assets, beginning of year or period 30,510,958 36,169,246 169,963,044 164,162,796 137,350,464 111,657,770
----------- ----------- ------------ ------------ ------------ ------------
Net Assets, end of year or period $31,039,886 $30,510,958 $169,432,030 $169,963,044 $112,461,119 $137,350,464
=========== =========== ============ ============ ============ ============
NET ASSETS CONSIST OF:
Capital $31,055,397 $30,526,469 $168,946,350 $165,685,652 $117,377,701 $144,775,094
Undistributed net investment
income (loss) -- -- 159,814 -- 522,357 --
Return of capital -- -- -- (8,051) -- (72,378)
Undistributed net realized gain
(loss) from investments (15,511) (15,511) 677,089 (224,103) (14,938,018) (30,932,914)
Unrealized appreciation
(depreciation) of investments
and foreign currency -- -- (351,223) 4,509,546 9,499,079 23,580,662
----------- ----------- ------------ ------------ ------------ ------------
$31,039,886 $30,510,958 $169,432,030 $169,963,044 $112,461,119 $137,350,464
=========== =========== ============ ============ ============ ============
TRANSACTIONS IN FUND SHARES
Shares sold:
Class A 2,425,011 3,590,366 2,970 15,817 64,474 74,730
Class R -- -- -- -- 770,392 105,917
Reinvested distributions:
Class A 50,968 172,625 321,858 1,197,717 -- 204,207
Class R -- -- -- -- -- 3,305
Shares redeemed:
Class A (1,947,051) (9,421,279) (5,900) (8,638) (4,698,176) (963,071)
Class R -- -- -- -- (29,919) (65,384)
----------- ----------- ------------ ------------ ------------ ------------
Net increase (decrease) in fund shares 528,928 (5,658,288) 318,928 1,204,896 (3,893,229) (640,296)
Shares outstanding, beginning of
year or period 30,526,469 36,184,757 16,527,476 15,322,580 19,452,573 20,092,869
----------- ----------- ------------ ------------ ------------ ------------
Shares outstanding, end of
year or period 31,055,397 30,526,469 16,846,404 16,527,476 15,559,344 19,452,573
=========== =========== ============ ============ ============ ============
30 ACTIVA Mutual Funds Semiannual Report
The accompanying notes are an integral part of these financial statements.
ACTIVA Statement of Changes in Net Assets continued
GROWTH FUND INTERNATIONAL FUND
PERIOD ENDED YEAR ENDED PERIOD ENDED YEAR ENDED
6/30/04 12/31/03 6/30/04 12/31/03
Increase (Decrease) in: (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
-------------------------- --------------------------
NET ASSETS FROM OPERATIONS
Net investment income (loss) ($74,616) ($119,798) $120,987 $117,078
Net realized gain (loss) on investments 2,127,899 (424,586) 2,993,942 1,453,644
Net increase (decrease) in unrealized appreciation (1,258,205) 7,181,253 (2,690,313) 5,561,455
----------- ----------- ----------- -----------
Net increase (decrease) in net assets resulting from operations 795,078 6,636,869 424,616 7,132,177
DISTRIBUTIONS TO SHAREHOLDERS Net investment income:
Class A -- -- -- (90,086)
Class R -- -- -- --
Net realized gain from investment transactions:
Class A -- -- -- --
Class R -- -- -- --
----------- ----------- ----------- -----------
Total distributions to shareholders -- -- -- (90,086)
CAPITAL SHARE TRANSACTIONS Net proceeds from sale of shares:
Class A 136,833 172,482 126,082 952,630
Class R -- -- -- --
Net asset value of shares issued to shareholders
in reinvestment of investment
income and realized gain from
security transactions:
Class A -- -- -- 90,083
Class R -- -- -- --
Payment for shares redeemed:
Class A (150,418) (109,318) (263,244) (893,102)
Class R -- -- -- --
----------- ----------- ----------- -----------
Net increase (decrease) in net assets derived from
capital share transactions (13,585) 63,164 (137,162) 149,611
----------- ----------- ----------- -----------
Net Increase (Decrease) in Net Assets 781,493 6,700,033 287,454 7,191,702
Net Assets, beginning of year or period 30,019,431 23,319,398 29,428,761 22,237,059
----------- ----------- ----------- -----------
Net Assets, end of year or period $30,800,924 $30,019,431 $29,716,215 $29,428,761
=========== =========== =========== ===========
NET ASSETS CONSIST OF:
Capital $37,639,904 $37,653,489 $35,339,310 $35,476,472
Undistributed net investment income (loss) (623,004) (548,387) (752,177) (767,698)
Return of capital -- -- -- --
Undistributed net realized gain (loss) from investments (10,281,069) (12,408,969) (7,342,360) (10,441,768)
Unrealized appreciation (depreciation) of investments and
foreign currency 4,065,093 5,323,298 2,471,442 5,161,755
----------- ----------- ----------- -----------
$30,800,924 $30,019,431 $29,716,215 $29,428,761
=========== =========== =========== ===========
TRANSACTIONS IN FUND SHARES
Shares sold:
Class A 21,374 29,961 17,613 157,871
Class R -- -- -- --
Reinvested distributions:
Class A -- -- -- 13,056
Class R -- -- -- --
Shares redeemed:
Class A (24,251) (19,669) (36,333) (147,844)
Class R -- -- -- --
----------- ----------- ----------- -----------
Net increase (decrease) in fund shares (2,877) 10,292 (18,720) 23,083
Shares outstanding, beginning of year or period 4,729,870 4,719,578 4,142,056 4,118,973
----------- ----------- ----------- -----------
Shares outstanding, end of year or period 4,726,993 4,729,870 4,123,336 4,142,056
=========== =========== =========== ===========
ACTIVA Mutual Funds Semiannual Report 31
The accompanying notes are an integral part of these financial statements.
ACTIVA Notes to Financial Statements
1. ORGANIZATION
Activa Mutual Fund Trust (Trust) was organized as a Delaware business trust on
February 2, 1998. The trust consists of five funds, each open-end management
investment companies registered under the Investment Company Act of 1940. The
funds are: the Activa Money Market Fund (Money Market Fund), the Activa
Intermediate Bond Fund (Intermediate Bond Fund), the Activa Value Fund (Value
Fund), the Activa Growth Fund (Growth Fund) and the Activa International Fund
(International Fund) collectively referred to as the Funds. The Value Fund is
the successor to Amway Mutual Fund.
2. SIGNIFICANT ACCOUNTING POLICIES
Investment Objectives
The Money Market Fund's investment objective is to seek a high level of current
income as is consistent with preservation of capital and liquidity. The Money
Market Fund invests in a broad spectrum of high quality U.S. dollar-denominated
money market securities, with the average weighted maturity of the securities
held not to exceed 90 days.
The Intermediate Bond Fund's investment objective is to seek a high level of
current income as is consistent with moderate risk of capital and maintenance of
liquidity. The Intermediate Bond Fund invests primarily in investment-grade debt
securities, with average maturity of three to ten years.
The Value Fund's investment objective is to seek long-term capital appreciation,
and invests primarily in common stocks of U.S. companies which are considered by
the investment manager to be undervalued.
The Growth Fund seeks long-term growth of capital, and invests primarily in
common stocks believed by the investment manager to have long-term growth
potential.
The International Fund seeks maximum long-term capital appreciation. The
International Fund invests primarily in common stocks of non-U.S. companies
which are believed by the investment manager to have potential for above-average
growth of earnings.
Classes of Shares
The Value Fund offers two classes of shares (Class A and Class R). The Class R
shares are offered to tax-exempt retirement and benefit plans of Alticor, Inc.
and its affiliates, and are not subject to any sales charges or 12b-1
distribution fees. Each share of Class A and Class R represents an equal
proportionate interest in the Value Fund and, generally, will have identical
voting, dividend, liquidation, and other rights and the same terms and
conditions. Each class will have exclusive voting rights with respect to matters
affecting only that class. Each class bears different distribution, shareholder
servicing and transfer agent expenses. Income, non-class specific expenses, and
realized and unrealized gains or losses on investments are allocated to each
class of shares based upon its relative net assets.
Security Valuation
Net asset values per share are calculated at the close of business on the New
York Stock Exchange, usually 4:00 PM Eastern time on each business day on which
that exchange is open. Investments in securities listed or admitted to trading
on a national securities exchange are valued at their last reported sale price
before the time of valuation. If a security is traded only in the
over-the-counter market, or if no sales have been reported for a listed security
on that day, it is valued at the mean between the current closing bid and ask
prices. Short-term securities maturing within 60 days are valued at amortized
cost, which approximates fair value. Portfolio debt securities with remaining
maturities greater than 60 days are valued by pricing agents approved by the
Board of Trustees. Foreign securities are converted to U.S. dollars using
exchange rates at the close of the New York Stock Exchange. Securities for which
market quotations are not readily available, including any restricted securities
(none at June 30, 2004), and other assets of the Funds are valued at fair market
value as determined by the Fund's Board of Trustees.
Derivative Transactions
The Funds (except the Money Market Fund) may trade in derivative contracts to
hedge portfolio holdings and for investment purposes. Hedging activities are
intended to reduce various risks associated with fluctuations in foreign
currency exchange rates. When entering into a forward currency contract, the
fund agrees to receive or deliver a fixed quantity of foreign currency for an
agreed-upon price on an agreed future date. These contracts are valued daily.
The fund's net equity in the contracts is included as unrealized gains or losses
in the statement of assets and liabilities. This unrealized gain or loss is the
difference between the forward foreign exchange rates at the dates of entry into
the contracts and the forward rates at the
32 ACTIVA Mutual Funds Semiannual Report
ACTIVA Notes to Financial Statements continued
reporting date. The current year change in unrealized gains and losses and
realized gains and losses are included in the statement of operations. These
instruments involve market risk, credit risk, or both kinds of risk, in excess
of the amount recognized in the statements of assets and liabilities. Risks
arise from the possible inability of counterparties to meet the terms of their
contracts and from movement in currency and security values and interest rates.
There were no foreign currency contracts outstanding at June 30, 2004.
Security Transactions
Security transactions are accounted for on the trade date. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Original issue discounts are accreted and premium is amortized on debt
securities to interest income over the life of a security with a corresponding
adjustment in the cost basis. Realized gains and losses from security
transactions and unrealized appreciation and depreciation of investments are
reported on a specific identification basis. Dividends and distributions to
shareholders are recorded by the Funds on the ex-dividend date.
Foreign Currency Translation
Investment securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at date of valuation.
Purchases and sales of investment securities and income and expense items
denominated in foreign currencies are translated into U.S. dollar amounts on the
respective dates of such transactions.
Net realized gains and losses from foreign currency and investment transactions
disclosed in the Statement of Operations consist of net gains and losses on
disposition of foreign currency, currency gains and losses realized between
trade and settlement dates on security transactions, and the difference between
the amount of net investment income accrued and the amount actually received in
U.S. dollars. Net unrealized foreign exchange gains and losses arise from
changes in fair values of assets and liabilities other than investments in
securities at period end, resulting from changes in exchange rates. The effects
of foreign currency exchange rates on foreign securities held are included in
net realized and unrealized gain or loss on investments.
Futures Contracts
The Funds may use futures contracts to manage its exposure to the stock and bond
markets. Buying futures tends to increase the fund's exposure to the underlying
instrument, while selling futures tends to decrease the fund's exposure to the
underlying instrument or hedge other fund investments. Futures contracts
involve, to varying degrees, risk of loss in excess of the futures variation
margin reflected in the Statement of Assets and Liabilities. The underlying face
amount at value of any open futures contracts at period end is shown at the end
of the schedule of investments. This amount reflects each contract's exposure to
the underlying instrument at period end. Losses may arise from changes in the
value of the underlying instruments or if the counterparties do not perform
under the contract's terms. Gains (losses) are realized upon the expiration or
closing of the futures contracts. Futures contracts are valued at the settlement
price established each day by the board of trade or exchange on which they are
traded.
Security Lending
The Funds lend portfolio securities from time to time in order to earn
additional income. The Funds receive collateral in the form of U.S. Treasury
obligations, letters of credit, and/or cash against the loaned securities, and
maintain collateral in an amount not less than 100% of the market value of the
loaned securities during the period of the loan. The market value of the loaned
securities is determined at the close of business of the Funds and any
additional required collateral is delivered to the Funds on the next business
day. If the borrower defaults on its obligation to return the securities loaned
because of insolvency or other reasons, the Funds could experience delays and
costs in recovering the securities loaned or in gaining access to the
collateral. At June 30, 2004, the value of the securities loaned and the
collateral received amounted to $42,053,260 and $42,890,507 respectively.
Income Taxes
It is the Funds' policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to make distributions of
income and capital gains sufficient to relieve it from substantially all federal
ACTIVA Mutual Funds Semiannual Report 33
ACTIVA Notes to Financial Statements continued
income taxes. Foreign taxes are provided for based on each fund's understanding
of the tax rules and rates that exist in the foreign markets in which it
invests.
Dividend Distributions
The Money Market Fund and Intermediate Bond Fund declare dividends daily and
monthly respectively, and distribute dividends monthly, and capital gains (if
any) are distributed annually. The Value Fund, Growth Fund and International
Fund declare and distribute dividends and capital gains (if any) annually.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles 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 increases and decreases in net
assets from operations during the reporting period. Actual results could differ
from those estimates.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
The Funds have entered into investment advisory agreements with Activa Asset
Management LLC (the Adviser), effective June 11, 1999. The Funds employ the
investment adviser to provide investment advice and manage on a regular basis
the investment portfolios for the Funds. Except when otherwise specifically
directed by the Funds, the Investment Adviser will make investment decisions on
behalf of the Funds and place all orders for the purchase and sale of portfolio
securities for the Funds' accounts. The Adviser shall be permitted to enter into
an agreement with another advisory organization (sub-adviser), whereby the
sub-adviser will provide all or part of the investment advice and services
required to manage the Funds' investment portfolios as provided for in these
agreements. In return for these services, the Funds pay the adviser an annual
rate as follows:
FUND % OF AVERAGE NET ASSETS
Money Market .35% until assets total $500 million; when assets
reach $500 million, .35% on first $100 million; .325% on
next $100 million; .30% on assets in excess of $200 million
Intermediate Bond .40% on first $50 million; .32% on next $100 million;
.24% on assets in excess of $150 million
Value .60% on first $100 million; .50% on assets in excess of
$100 million; the minimum annual fee shall be $350,000
plus .20%
Growth .70% on first $25 million; .65% on next $25 million; .60%
on assets in excess of $50 million
International .85% on first $50 million; .75% on assets in excess of
$50 million
As permitted by the above agreements, the Adviser has retained the following
sub-advisers:
FUND SUB-ADVISER
Money Market J.P. Morgan Investment
Management, Inc.
Intermediate Bond McDonnell Investment Management, LLC
Value Wellington Management Company, LLP
Growth State Street Research &
Management Company
International Nicholas-Applegate Capital Management
Pursuant to Rule 12b-1 under the Investment Company Act of 1940, the Money
Market Fund, Value Fund, Intermediate Bond Fund, Growth Fund and International
Fund have entered into a Plan and Agreement of Distribution with Activa Asset
Management LLC. Under the terms of the agreement, Activa Asset Management LLC
provides services in connection with distributing the Funds' shares (except
Value Fund Class R). For these services rendered, the Funds compensate Activa
Asset Management LLC monthly at a maximum annual rate of .25 of 1% of the
average net assets of the Fund. For the six month period ended June 30, 2004 the
Board of Trustees approved an annual rate of .15 of 1%, for all funds except the
Money Market Fund. Activa Asset Management LLC is not presently providing
services under the distribution plan on behalf of the Money Market Fund and is
receiving no such compensation.
The Funds have a transfer agency and dividend disbursing agency agreement with
Activa Asset Management LLC. Under these agreements, Activa Asset Management LLC
is the agent
34 ACTIVA Mutual Funds Semiannual Report
ACTIVA Notes to Financial Statements continued
for transfer of the Funds' shares and disbursement of the Funds' distributions.
For these services, The Money Market, Intermediate Bond, Value (Class A), Growth
and International Funds pay a monthly fee based upon $1.167 per account in
existence during the month. The transfer agent is compensated by the Value Fund
(Class R) at a monthly rate of 1/12 of .20% (.20% annually) of average net
assets.
On June 11, 1999 the Trust entered into an administrative agreement with Activa
Asset Management LLC. Under the terms of the agreement Activa Asset Management
LLC will act as administrator for the Funds. As administrator of the Funds,
Activa Asset Management LLC will furnish office space and office facilities,
equipment and personnel, pay the fees of all Trustees of the Trust, as well as
providing services relating to compliance, tax and financial service
requirements. For these services, the administrator will be compensated
quarterly by each fund at an annual rate of .15% of average daily net assets.
The original administrative agreement provided that the administrator would pay
the fees of all the Trustees of the Trust. On June 3, 2004 the agreement was
amended to provide that the Fund would pay the fees and expenses of its
Disinterested Trustees, and that the administrator would pay the salary and
related expenses of the Fund's Chief Compliance Officer.
On July 9, 1999 the Trust entered into a Fund Accounting Agreement with Bisys
Fund Services Ohio, Inc. (Fund Accountant). As stated in the agreement, the Fund
Accountant is responsible for the maintenance of books and records, performance
of daily accounting services, providing the Funds' management with monthly
financial statements and certain information necessary for meeting compliance
requirements. The Fund Accountant is compensated by each fund based upon an
annual fee of $35,000 for assets up to $100 million; $50,000 for assets between
$100 million and $1 billion; and $75,000 for assets in excess of $1 billion. In
addition, each fund will pay the Fund Accountant an annual fee of $2,500 for
portfolio accounting reports provided to investment adviser personnel through
internet access.
Two individuals and their families, which own (directly or indirectly) the
majority of the shares outstanding of the Trust, also indirectly own 100% of the
Adviser.
4. INVESTMENT TRANSACTIONS
At June 30, 2004, the cost of investments owned by the Value Fund was
$102,301,807 for federal income tax purposes. Aggregate gross unrealized
appreciation on securities in which there was an excess of market value over tax
cost was $10,799,556. Aggregate gross unrealized depreciation on securities in
which there was an excess of tax cost over market value was $1,454,586. Net
unrealized appreciation for tax purposes was $9,344,970, at June 30, 2004.
The unrealized appreciation (depreciation) at June 30, 2004 based upon cost of
both long-term and short-term securities for the funds that have elected an
October 31st year-end for federal income tax purposes were as follows:
Net Cost for
Gross Gross unrealized federal
unrealized unrealized appreciation income tax
Fund appreciation depreciation (depreciation) purposes
------------ ------------ -------------- ----------
Money Market N/A N/A N/A 31,057,343
Intermediate
Bond 2,204,537 2,555,759 (351,222) 165,998,542
Growth 4,193,847 641,018 3,552,829 27,297,705
International 2,805,561 383,097 2,422,464 26,652,085
5. RELATED PARTY TRANSACTION
A certain class of Independent Business Owners of Alticor, Inc. received part of
its Emerald profit-sharing bonus in common stock shares of the Value Fund or
Money Market Fund. On January 8, 2004, Alticor, Inc. purchased 8,811 Value Fund
shares valued at $62,908 (based upon the net asset value of $7.14 per share) and
1,711,697 Money Market Fund shares valued at $1,711,697 (based upon the net
asset value of $1.00 per share) and transferred the shares to these Independent
Business Owners.
On February 4, 2004 Jay Van Andel, a principal shareholder of the Activa Mutual
Fund, who owns all the outstanding securities of JVA Properties Corporation, the
General Partner for JVA Enterprises Limited Partnership redeemed $30,000,000
from the Activa Value Fund, via a redemption in kind, as part of a reallocation
of investment assets.
ACTIVA Mutual Funds Semiannual Report 35
ACTIVA Financial Highlights
MONEY MARKET FUND INTERMEDIATE BOND FUND
---------------------------- -------------------------------
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
6/30/04 12/31/03 6/30/04 12/31/03
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
---------- ---------- ---------- ----------
Net Asset Value, Beginning of Period $1.00 $1.00 $10.28 $10.71
Income from investment operations:
Net investment income (loss) -- 0.01 0.21 0.46
Net realized and unrealized gains (losses) on securities -- -- (0.23) (0.09)
---------- ---------- ---------- ----------
Total from investment operations -- 0.01 (0.02) 0.37
Less Distributions:
Dividends from net investment income -- 0.01 0.20 0.46
Dividends in excess of net investment income -- -- -- --
Distributions from capital gains -- -- -- 0.34
---------- ---------- ---------- ----------
Total Distributions -- 0.01 0.20 0.80
---------- ---------- ---------- ----------
Net Asset Value, End of Period $1.00 $1.00 $10.06 $10.28
Total Return * 0.16% 0.47% -0.23% 3.49%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $31,039,886 $30,510,958 $169,432,030 $169,963,044
Ratio of expenses to average net assets 0.4% 0.8% 0.4% 0.7%
Ratio of net income (loss) to average net assets 0.2% 0.5% 2.0% 4.6%
Portfolio turnover rate N/A N/A 36.7% 104.0%
* The period ended June 30, 2004 is not annualized but an aggregate total
return for the period.
36 ACTIVA Mutual Funds Semiannual Report
VALUE FUND - CLASS A VALUE FUND - CLASS R
---------------------------- ---------------------------
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
6/30/04 12/31/03 6/30/04 12/31/03
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
---------- ---------- ---------- ----------
Net Asset Value, Beginning of Period $7.06 $5.56 $7.09 $5.57
Income from investment operations:
Net investment income (loss) 0.04 0.08 0.04 0.07
Net realized and unrealized gains
(losses) on securities 0.13 1.50 0.13 1.52
---------- ---------- ---------- -------
Total from investment operations 0.17 1.58 0.17 1.59
Less Distributions:
Dividends from net investment income -- 0.08 -- 0.07
Dividends in excess of net investment income -- -- -- --
Distributions from capital gains -- -- -- --
---------- ---------- ---------- -------
Total Distributions -- 0.08 -- 0.07
---------- ---------- ---------- -------
Net Asset Value, End of Period $7.23 $7.06 $7.26 $7.09
Total Return * 2.41% 28.37% 2.40% 28.65%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $104,832,689 $135,146,120 $7,628,430 $2,204,343
Ratio of expenses to average net assets 0.6% 1.1% 0.5% 1.0%
Ratio of net income (loss) to average net assets 0.5% 1.2% 0.6% 1.3%
Portfolio turnover rate 71.4% 65.7% 71.4% 65.7%
GROWTH FUND INTERNATIONAL FUND
--------------------------- ----------------------------
PERIOD YEAR PERIOD YEAR
ENDED ENDED ENDED ENDED
6/30/04 12/31/03 6/30/04 12/31/03
Per share outstanding for each period (UNAUDITED) (AUDITED) (UNAUDITED) (AUDITED)
---------- ---------- ---------- ----------
Net Asset Value, Beginning of Period $6.35 $4.94 $7.10 $5.40
Income from investment operations:
Net investment income (loss) (0.02) (0.03) 0.03 0.02
Net realized and unrealized gains
(losses) on securities 0.19 1.44 0.08 1.70
------- ---------- ---------- ----------
Total from investment operations 0.17 1.41 0.11 1.72
Less Distributions:
Dividends from net investment income -- -- -- 0.02
Dividends in excess of net investment income -- -- -- --
Distributions from capital gains -- -- -- --
------- ---------- ---------- ----------
Total Distributions -- -- -- 0.02
------- ---------- ---------- ----------
Net Asset Value, End of Period $6.52 $6.35 $7.21 $7.10
Total Return * 2.68% 28.54% 1.55% 31.90%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period $30,800,924 $30,019,431 $29,716,215 $29,428,761
Ratio of expenses to average net assets 0.6% 1.4% 0.8% 1.7%
Ratio of net income (loss) to average net assets -0.2% -0.5% 0.4% 0.5%
Portfolio turnover rate 50.7% 101.0% 87.7% 188.0%
ACTIVA Mutual Funds Semiannual Report 37
Activa Mutual Funds
Activa Mutual Funds
2905 Lucerne SE, Suite 200
Grand Rapids, Michigan 49546
(616) 787-6288 (800) 346-2670
www.activafunds.com
Printed in U.S.A.
ITEM 2. CODE OF ETHICS.
Not applicable at this time.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable at this time.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable at this time.
ITEMS 5 - 6. (RESERVED)
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Municipal Funds - Not applicable to this registrant.
Non-Municipal Funds - Not applicable to this registrant.
ITEM 8. RESERVED.
ITEM 9. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, 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 (the "1940 Act") (17 CFR
270.30a-3(c))) are effective, as of a date within 90 days of the filing date of
this report that includes the disclosure required by this paragraph, based on
their evaluation of these controls and procedures required by Rule 30a-3(b)
under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under
the Exchange Act (17 CFR 240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR
270.30a-3(d)) that occurred during the registrant's last fiscal half-year (the
registrant's second fiscal half-year in the case of an annual report) that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 10. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Not applicable.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act (17
CFR 270.30a-2) in the exact form set forth below: Ex-99.CERT Attached hereto.
(c) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Section 906 of the Sarbanes-
Oxley Act of 2002. Ex-99.906 CERT Attached hereto.
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.
(Registrant) Activa Mutual Fund Trust
-----------------------------------------------------------
By (Signature and Title)* /s/ Allan D. Engel
----------------------------------------------
Allan D. Engel
President, Principal Executive Officer and
Principal Financial Officer
Date September 1, 2004
-------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)*
----------------------------------------------
Date
-------------------------------------------------------------------
By (Signature and Title)* /s/
----------------------------------------------
Date
-------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.