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 811-07582
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The Valiant Fund
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(Exact name of registrant as specified in charter)
221 Pensacola Boulevard, Venice, FL, 34285
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(Address of principal executive offices) (Zip code)
Denis R. Curcio
221 Pensacola Boulevard, Venice, FL, 34285
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(Name and address of agent for service)
Registrant's telephone number, including area code: 800-242-9340
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Date of fiscal year end: 8/31/05
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Date of reporting period: 2/28/05
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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 STOCKHOLDERS.
THE VALIANT FUND
SEMI-ANNUAL REPORT
FEBRUARY 28, 2005
THE VALIANT FUND
Semi-Annual Report - February 28, 2005
Table of Contents
PAGE
----
Fees and Expenses Table 1
U.S. TREASURY MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments 3
Statement of Assets and Liabilities 4
Statement of Operations 4
Statements of Changes in Net Assets 5
Financial Highlights 6
GENERAL MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments 8
Statement of Assets and Liabilities 11
Statement of Operations 11
Statements of Changes in Net Assets 12
Financial Highlights 13
TAX-EXEMPT MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments 15
Statement of Assets and Liabilities 17
Statement of Operations 17
Statements of Changes in Net Assets 18
Financial Highlights 19
Notes to Financial Statements 20
Management of the Trust 26
Fees and Expenses (unaudited)
As a shareholder of the Valiant Fund, you incur advisory fees and
distribution(12b-1) fees. All other Fund expenses are paid by the advisor. This
example is intended to help you understand your ongoing costs (in dollars) of
investing in the Fund and to compare these costs with the ongoing costs of
investing in other mutual funds.
The example is based on an investment of $1,000 invested at the beginning of the
period and held through the six months ended February 28, 2005.
ACTUAL EXPENSES
The first line for each share class in the following tables provides information
about actual account values and actual expenses. You may use the information in
this line, together with the amount you invested, to estimate the expenses that
you paid over the period. Simply divide your account value by $1,000 (for
example, an $8,600 account value divided by $1,000 = 8.6), then multiply the
result by the number in the first line under the heading "Expenses Paid During
the Six-Month Period" to estimate the expenses you paid on your account during
this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line for each share class in the following tables provides
information about hypothetical account values and hypothetical expenses based on
the Porfolios' actual expense ratio and an assumed rate of return of 5% per year
before expenses, which is not the Portfolios' actual return. The hypothetical
account values and expenses may not be used to estimate the actual ending
account balance or expenses you paid for the period. You may use this
information to compare the ongoing costs of investing in the Funds and other
funds. To do so, compare this 5% hypothetical example with the 5% hypothetical
examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the tables are meant to highlight your
ongoing costs only, and do not reflect any transactional costs such as sales
charges (loads). Therefore the second line for each share class in the table is
useful in comparing ongoing costs only, and will not help you determine the
relative total costs of owning different funds. In addition, if these
transactional costs were included, your costs would have been higher.
- -------------------------------------------------------------------------------------------------------------------------
BEGINNING ENDING ANNUALIZED
ACCOUNT ACCOUNT EXPENSE RATIO EXPENSES PAID
VALUE VALUE BASED ON THE DURING THE
09/01/04 02/28/05 SIX-MONTH PERIOD SIX-MONTH PERIOD*
- -------------------------------------------------------------------------------------------------------------------------
U.S. TREASURY MONEY MARKET PORTFOLIO - CLASS A
Actual $1,000.00 $1,008.86 0.20% $1.00
Hypothetical (5% return before expenses) $1,000.00 $1,023.80 0.20% $1.00
- -------------------------------------------------------------------------------------------------------------------------
U.S. TREASURY MONEY MARKET PORTFOLIO - CLASS B
Actual $1,000.00 $1,007.67 0.45% $2.24
Hypothetical (5% return before expenses) $1,000.00 $1,022.56 0.45% $2.26
- -------------------------------------------------------------------------------------------------------------------------
U.S. TREASURY MONEY MARKET PORTFOLIO - CLASS D
Actual $1,000.00 $1,006.42 0.70% $3.48
Hypothetical (5% return before expenses) $1,000.00 $1,021.32 0.70% $3.51
- -------------------------------------------------------------------------------------------------------------------------
1
Fees and Expenses continued (unaudited)
- -------------------------------------------------------------------------------------------------------------------------
U.S. TREASURY MONEY MARKET PORTFOLIO - CLASS E
Actual $1,000.00 $1,004.93 1.00% $4.97
Hypothetical (5% return before expenses) $1,000.00 $1,019.84 1.00% $5.01
- -------------------------------------------------------------------------------------------------------------------------
GENERAL MONEY MARKET PORTFOLIO - CLASS A
Actual $1,000.00 $1,009.41 0.20% $1.00
Hypothetical (5% return before expenses) $1,000.00 $1,023.80 0.20% $1.00
- -------------------------------------------------------------------------------------------------------------------------
GENERAL MONEY MARKET PORTFOLIO - CLASS B
Actual $1,000.00 $1,008.12 0.45% $2.24
Hypothetical (5% return before expenses) $1,000.00 $1,022.56 0.45% $2.26
- -------------------------------------------------------------------------------------------------------------------------
GENERAL MONEY MARKET PORTFOLIO - CLASS D
Actual $1,000.00 $1,006.91 0.70% $3.48
Hypothetical (5% return before expenses) $1,000.00 $1,021.32 0.70% $3.51
- -------------------------------------------------------------------------------------------------------------------------
GENERAL MONEY MARKET PORTFOLIO - CLASS E
Actual $1,000.00 $1,005.42 1.00% $4.97
Hypothetical (5% return before expenses) $1,000.00 $1,019.84 1.00% $5.01
- -------------------------------------------------------------------------------------------------------------------------
TAX-EXEMPT MONEY MARKET PORTFOLIO - CLASS A
Actual $1,000.00 $1,006.98 0.20% $1.00
Hypothetical (5% return before expenses) $1,000.00 $1,023.80 0.20% $1.00
- -------------------------------------------------------------------------------------------------------------------------
TAX-EXEMPT MONEY MARKET PORTFOLIO - CLASS B
Actual $1,000.00 $1,005.70 0.45% $2.24
Hypothetical (5% return before expenses) $1,000.00 $1,022.56 0.45% $2.26
- -------------------------------------------------------------------------------------------------------------------------
* EXPENSES FOR EACH PORTFOLIO ARE CALCULATED USING THE PORTFOLIO'S ANNUALIZED
EXPENSE RATIO FOR EACH FUND, WHICH REPRESENTS THE ONGOING EXPENSES AS A
PERCENTAGE OF NET ASSETS FOR THE SIX-MONTHS ENDED 02/28/05. EXPENSES ARE
CALCULATED BY MULTIPLYING THE ANNUALIZED EXPENSE RATIO BY THE AVERAGE ACCOUNT
VALUE FOR THE PERIOD; THEN MULTIPLYING THE RESULT BY THE NUMBER OF DAYS IN THE
MOST RECENT FISCAL HALF-YEAR; AND THEN DIVIDING THAT RESULT BY THE NUMBER OF
DAYS IN THE CALENDAR YEAR. EXPENSE RATIOS FOR THE MOST RECENT FISCAL HALF-YEAR
MAY DIFFER FROM EXPENSE RATIOS BASED ON THE ONE-YEAR DATA IN THE FINANCIAL
HIGHLIGHTS.
2
VALIANT U.S. TREASURY MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments
February 28, 2005 (unaudited)
MATURITY PRINCIPAL
RATE DATE AMOUNT VALUE
------ --------- ----------- ------------
U.S. TREASURY OBLIGATIONS - 55.4%
U.S. TREASURY BILLS(C) - 43.5%
2.16% 3/3/2005 $75,000,000 $ 74,991,000
2.20 4/14/2005 15,000,000 14,960,034
2.29 5/5/2005 10,000,000 9,959,149
2.53 6/2/2005 10,000,000 9,935,417
------------
109,845,600
------------
U.S. TREASURY NOTES - 11.9%
1.625 3/31/2005 10,000,000 10,002,604
1.625 4/30/2005 15,000,000 14,998,556
1.625 2/28/2006 5,000,000 4,931,465
------------
29,932,625
------------
TOTAL U.S. TREASURY OBLIGATIONS (AMORTIZED COST $139,778,225) 139,778,225
------------
REPURCHASE AGREEMENTS - 44.7%
Bank of America, Inc., 2.61%, due 3/1/05, with a
maturity value of $30,002,175
(Collateralized by a 0.00% GNMA Bond valued at $30,600,001
with maturity date 7/20/2034) 30,000,000 30,000,000
Citigroup, Inc., 2.60%, due 3/1/05, with a
maturity value of $30,002,167
(Collateralized by a 4.50% GNMA bond valued at $30,600,000
with maturity date 1/20/2032) 30,000,000 30,000,000
J.P. Morgan Chase & Co., 2.62%, due 3/1/05, with a
maturity value of $22,601,645
(Collateralized by various 3.75% - 5.70% GNMA bonds valued
at $23,055,970 with maturity dates 2/20/2034 - 4/15/2042) 22,600,000 22,600,000
UBS Paine Webber, 2.59%, due 3/1/05, with a
maturity value of $30,002,158
(Collateralized by various 4.00% - 9.00% GNMA bonds valued
at $30,601,229 with maturity dates 5/15/2009 - 2/15/2035) 30,000,000 30,000,000
------------
TOTAL REPURCHASE AGREEMENTS (AMORTIZED COST $112,600,000) 112,600,000
------------
INVESTMENT OF CASH COLLATERAL FOR SECURITIES LOANED - 10.4%
Bank of New York Institutional Cash Reserves Fund
(AMORTIZED COST $26,271,521)* (B) 26,271,521
TOTAL INVESTMENTS (AMORTIZED COST $278,649,746) (A) - 110.5% 278,649,746
LIABILITIES IN EXCESS OF OTHER ASSETS - (10.5%) (26,481,255)
------------
TOTAL NET ASSETS - 100% $252,168,491
============
- ----------
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
(b) At February 28, 2005, the total market value of the fund's securities on
loan is $25,902,775 and the total market value of the collateral held by
the fund is $26,271,521 (See Note 5)
(c) Interest rate represents yield to maturity at purchase.
* Money market mutual fund registered under the Investment Company Act of
1940, as amended, and advised by Bank of New York.
GNMA - Government National Mortgage Association
VALIANT U.S. TREASURY MONEY MARKET PORTFOLIO
U.S. Treasury Obligation 55.4%
Repurchase Agreements 44.7
Investment of Cash Collateral For Securities Loaned 10.4
-----
110.5
Liabilities In Excess of Other Assets (10.5)
-----
100.0%
=====
See notes to financial statements.
3
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
FEBRUARY 28, 2005 (UNAUDITED)
ASSETS:
Investments at value (cost $278,649,746) $166,049,746
(including securities loaned valued at $25,902,775)
Repurchase agreements 112,600,000
------------
Total investments 278,649,746
Cash 1,164
Receivables:
Securities sold 197,941,764
Capital shares 390,941
Interest 200,032
Other assets 5,039
------------
TOTAL ASSETS 477,188,686
LIABILITIES:
Payables:
Securities purchased $187,586,500
Liability for securities loaned-Note 5 26,271,521
Capital shares 10,675,103
Dividends 352,389
Accrued expenses and other liabilities:
Investment manager 39,953
Distribution and shareholder servicing 94,729
------------
TOTAL LIABILITIES 225,020,195
------------
NET ASSETS $252,168,491
============
COMPOSITION OF NET ASSETS:
Capital $252,420,154
Over distributed net investment income (3,230)
Accumulated net realized loss from
investment transactions (248,433)
------------
NET ASSETS $252,168,491
============
Class A Shares
Net assets $ 1,519,274
Shares outstanding 1,519,987
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class B Shares
Net assets $ 62,776,806
Shares outstanding 62,844,798
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class D Shares
Net assets $176,655,559
Shares outstanding 176,826,794
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class E Shares
Net assets $ 11,216,852
Shares outstanding 11,228,574
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS ENDED FEBRUARY 28, 2005 (UNAUDITED)
INVESTMENT INCOME:
Interest $ 2,731,295
Securities lending income - net 16,194
------------
TOTAL INVESTMENT INCOME 2,747,489
EXPENSES:
Investment manager $ 281,651
Distribution and shareholder servicing:
Class A Shares 560
Class B Shares 135,961
Class D Shares 473,284
Class E Shares 57,299
Trustees fees 7,234
------------
Total expenses before contractual
fee reimbursements 955,989
Contractual fee reimbursements (46,640)
------------
NET EXPENSES 909,349
------------
NET INVESTMENT INCOME 1,838,140
------------
NET REALIZED GAIN FROM INVESTMENT TRANSACTIONS 21
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 1,838,161
============
See notes to financial statements.
4
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE
FEBRUARY 28, 2005 YEAR ENDED
(UNAUDITED) AUGUST 31, 2004
----------------- -----------------
INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income $ 1,838,140 $ 1,971,634
Net realized gain from investment transactions 21 406
----------------- -----------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 1,838,161 1,972,040
----------------- -----------------
DIVIDENDS:
Net investment income:
Class A Shares (3,069) (32,008)
Class B Shares (595,829) (843,776)
Class D Shares (1,217,745) (1,073,808)
Class E Shares (69,111) (22,042)
----------------- -----------------
TOTAL DIVIDENDS TO SHAREHOLDERS (1,885,754) (1,971,634)
----------------- -----------------
DECREASE IN NET ASSETS FROM CAPITAL TRANSACTIONS (50,299,043) (145,889,098)
----------------- -----------------
NET DECREASE IN NET ASSETS (50,346,636) (145,888,692)
NET ASSETS:
Beginning of period 302,515,127 448,403,819
----------------- -----------------
End of period (including over distributed net
investment income of $3,230 at February 28, 2005
and undistributed net investment income of $47,615
at August 31, 2004) $ 252,168,491 $ 302,515,127
================= =================
See notes to financial statements.
5
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS A SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.009 0.009 0.012 0.021 0.05 0.06
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.009) (0.009) (0.012) (0.021) (0.05) (0.06)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (A) 0.88% 0.92% 1.22% 2.05% 5.30% 5.66%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 1,519 $ 339 $ 7,159 $ 7,260 $ 10,355 $ 15,725
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.56%(b) 0.55% 0.55% 0.55% 0.55% 0.55%
Ratio of expenses to average net assets 0.20%(b) 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of net investment income to average
net assets 1.90%(b) 0.87% 1.21% 2.12% 5.13% 5.55%
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS B SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.008 0.007 0.010 0.018 0.05 0.05
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.008) (0.007) (0.010) (0.018) (0.05) (0.05)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (A) 0.76% 0.67% 0.96% 1.80% 5.04% 5.39%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 62,777 $ 89,633 $126,617 $146,246 $117,213 $ 41,893
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.56%(b) 0.55% 0.55% 0.55% 0.55% 0.55%
Ratio of expenses to average net assets 0.45%(b) 0.45% 0.45% 0.45% 0.45% 0.45%
Ratio of net investment income to average
net assets 1.50%(b) 0.65% 0.95% 1.77% 4.44% 5.20%
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes
reinvestment of dividends. Total returns for periods less than one full
year are not annualized.
(b) Annualized.
See notes to financial statements.
6
THE VALIANT FUND
U.S. TREASURY MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS D SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.006 0.004 0.008 0.015 0.05 0.05
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.006) (0.004) (0.008) (0.015) (0.05) (0.05)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (A) 0.64% 0.42% 0.71% 1.54% 4.77% 5.13%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $176,656 $197,640 $286,191 $325,896 $339,659 $269,929
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.71%(b) 0.70% 0.70% 0.70% 0.70% 0.70%
Ratio of expenses to average net assets 0.70%(b) 0.70% 0.70% 0.70% 0.70% 0.70%
Ratio of net investment income to average
net assets 1.25%(b) 0.41% 0.71% 1.54% 4.55% 5.04%
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS E SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.005 0.001* 0.005 0.013 0.04 0.05
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.005) (0.001) * (0.005) (0.013) (0.04) (0.05)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (A) 0.49% 0.12% 0.41% 1.24% 4.46% 4.82%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 11,217 $ 14,903 $ 28,437 $105,257 $220,850 $141,693
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 1.01%(b) 1.00% 1.00% 1.00% 1.00% 1.00%
Ratio of expenses to average net assets 1.00%(b) 1.00% 1.00% 1.00% 1.00% 1.00%
Ratio of net investment income to average
net assets 0.93%(b) 0.10% 0.48% 1.32% 4.19% 5.31%
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes
reinvestment of dividends. Total returns for periods less than one full
year are not annualized.
(b) Annualized.
See notes to financial statements.
7
VALIANT GENERAL MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments
February 28, 2005 (unaudited)
MATURITY PRINCIPAL
RATE DATE AMOUNT VALUE
-------- ---------- ------------ ------------
COMMERCIAL PAPER - 53.9%
BANKING - 6.7%
Banco Bilbao Vizcaya 2.16% 4/19/2005 $ 15,000,000 $ 14,946,917
Depfa Bank Europe PLC 2.75 5/17/2005 25,000,000 24,852,951
------------
39,799,868
------------
BROKER / DEALERS - 2.6%
Goldman Sachs Group, Inc. 2.63 3/1/05 15,000,000 15,000,000
------------
EDUCATION - 1.9%
Johns Hopkins University 2.65 4/19/05 11,300,000 11,300,000
------------
FINANCE - 17.7%
Bear Stearns Cos., Inc. 2.54 3/24/05 20,000,000 19,967,545
Govco, Inc. 2.59 4/5/2005 20,000,000 19,949,639
National Australia Funding 2.52 3/23/05 20,000,000 19,969,139
Sigma Finance, Inc. 2.59 4/7/05 20,000,000 19,946,761
UBS Finance Delaware LLC 2.59 3/1/05 25,000,000 25,000,000
------------
104,833,084
------------
SPECIAL PURPOSE ENTITY - 25.0%
Clipper Receivables Corp. 2.60 3/1/05 25,000,000 25,000,000
Delaware Funding Corp. 2.53 3/22/2005 25,000,000 24,963,104
FCAR Owner Trust 2.53 3/24/2005 20,000,000 19,967,672
Lockhart Funding LLC 2.58 3/24/2005 20,000,000 19,967,033
Market Street Funding 2.53 3/17/2005 20,000,000 19,977,511
NATC California LLC 2.60 4/18/2005 15,000,000 14,948,000
Steamboat Funding Corp. 2.54 3/15/2005 23,305,000 23,281,928
------------
148,105,248
------------
TOTAL COMMERCIAL PAPER (AMORTIZED COST $319,038,200) 319,038,200
------------
CORPORATE OBLIGATIONS - 11.4%
FINANCIAL SERVICES - 2.4%
Bank of America 2.55 3/3/2005 10,000,000 10,000,000
Labelle Capital Funding LLC* 2.70 3/3/2005 1,125,000 1,125,000
Wyoming Steel Investment * 2.70 3/3/2005 3,375,000 3,375,000
------------
14,500,000
------------
FOOD - 0.2%
Jacksons Food Stores, Inc.* 2.70 3/3/2005 918,000 918,000
------------
HEALTH SERVICES - 1.1.%
Gastroenterology Associates, LLC 2.69 3/3/2005 2,720,000 2,720,000
Louisiana Endoscopy Floater 2.69 3/3/2005 1,930,000 1,930,000
Riverview Medical Office Building* 2.68 3/3/2005 800,000 800,000
------------
5,450,000
------------
LEISURE - 0.8%
Commonwealth Country Club, Ltd.* 2.68 3/3/2005 3,240,000 3,240,000
Sandusky Yacht Club* 2.70 3/3/2005 1,205,000 1,205,000
------------
4,445,000
------------
REAL ESTATE - 3.3%
208 Associates LLC* 2.70 3/3/2005 925,000 925,000
Aztec Properties LLC* 2.70 3/3/2005 2,083,000 2,083,000
CMW Real Estate LLC* 2.68 3/3/2005 2,255,000 2,255,000
El Dorado Enterprises of Miami FL* 2.72 3/3/2005 2,000,000 2,000,000
El Dorado Enterprises of Miami FL* 2.67 3/3/2005 9,865,000 9,865,000
G & J Properties II* 2.70 3/3/2005 965,000 965,000
Ordeal Properties LLC* 2.70 3/3/2005 1,450,000 1,450,000
------------
19,543,000
------------
See notes to financial statements.
8
VALIANT GENERAL MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments
February 28, 2005 (unaudited)
MATURITY PRINCIPAL
RATE DATE AMOUNT VALUE
-------- ---------- ------------ ------------
SPECIAL PURPOSE ENTITY - 3.6%
Approach Partnership* 2.70% 3/3/05 $ 1,070,000 $ 1,070,000
Barry-Wehmiller Group* 2.70 3/3/05 1,180,000 1,180,000
Best One Tire & Service* 2.70 3/3/05 900,000 900,000
Butler County, Surgical Properties* 2.70 3/3/05 1,400,000 1,400,000
Chuo Mubea Suspen Compon* 2.70 3/3/05 400,000 400,000
Exal Corp.* 2.70 3/3/2005 1,500,000 1,500,000
FE LLC* 2.65 3/3/2005 1,000,000 1,000,000
GCG Portage LLC 2.75 3/3/2005 1,235,000 1,235,000
ISO Building LLC* 2.70 3/3/2005 1,000,000 1,000,000
K. C. Jordan & Associates* 2.70 3/3/2005 725,000 725,000
Michigan Equity Group* 2.70 3/3/2005 1,375,000 1,375,000
MMR Development Co.* 2.70 3/3/2005 1,080,000 1,080,000
Physicians Center LP* 2.69 3/3/2005 3,570,000 3,570,000
Taylor Steel, Inc.* 2.70 3/3/2005 2,235,000 2,235,000
United Transportation Union* 2.70 3/3/2005 1,125,000 1,125,000
Village Enterprises* 2.70 3/3/2005 1,000,000 1,000,000
Wellington Green LLC* 2.70 3/3/2005 1,780,000 1,780,000
------------
22,575,000
------------
TOTAL CORPORATE OBLIGATIONS (AMORTIZED COST $67,431,000) 67,431,000
------------
CERTIFICATE OF DEPOSIT - 3.4%
BANKING - 3.4%
Citibank 2.45 3/21/2005 20,000,000 20,000,000
------------
TOTAL CERTIFICATE OF DEPOSIT (AMORTIZED COST $20,000,000) 20,000,000
------------
MUNICIPAL NOTES AND BONDS - 5.2%
ALABAMA - 3.1%
Auburn Taxable Revenue, Series B* 2.61 3/3/2005 6,000,000 6,000,000
Meadow Brook* 2.69 3/3/2005 12,170,000 12,170,000
------------
18,170,000
------------
ILLINOIS - 0.7%
Upper Illinois River Valley Development Authority* 2.70 3/3/2005 4,595,000 4,595,000
------------
MICHIGAN - 0.3%
Michigan City Industrial Economic Development Revenue* 2.70 3/3/2005 1,605,000 1,605,000
------------
NEW YORK - 0.6%
Baird Properties LLC* 2.79 3/3/2005 2,110,000 2,110,000
IHA Capital Development Corp.* 2.70 3/3/2005 1,500,000 1,500,000
------------
3,610,000
------------
OHIO - 0.5%
Hopkins Waterhouse LLC* 2.68 3/3/2005 910,000 910,000
Mercer County, HealthCare Facilities* 2.72 3/3/2005 1,960,000 1,960,000
------------
2,870,000
------------
TOTAL MUNICIPAL NOTES AND BONDS (AMORTIZED COST $30,850,000) 30,850,000
------------
UNITED STATES GOVERNMENT AGENCY - 1.7%
Federal Home Loan Bank 3.25 8/15/2005 5,000,000 5,020,819
Federal National Mortgage Association 1.75 5/23/2005 5,000,000 5,000,000
------------
TOTAL UNITED STATES GOVERNMENT AGENCY (AMORTIZED COST $10,020,819) 10,020,819
------------
See notes to financial statements.
9
VALIANT GENERAL MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments
February 28, 2005 (unaudited)
MATURITY PRINCIPAL
RATE DATE AMOUNT VALUE
-------- ---------- ------------ ------------
REPURCHASE AGREEMENT - 24.5%
Bank of America, Inc., 2.61%, due 3/01/05,
with a maturity value of $145,410,542
(Collateralized by various 0.00% - 5.50% GNMA bonds valued at
$148,308,001 with maturity dates 9/26/2023 - 2/20/2035) $145,400,000 $145,400,000
TOTAL REPURCHASE AGREEMENTS (AMORTIZED COST $145,400,000) 145,400,000
------------
TOTAL INVESTMENTS (AMORTIZED COST $592,740,019) (A) - 100.1% 592,740,019
LIABILITIES IN EXCESS OF OTHER ASSETS - (0.1%) (540,770)
------------
TOTAL NET ASSETS - 100% $592,199,249
============
- ----------
* Variable rate investment. Securities payable on demand at par including
accrued interest (usually within seven days notice) and unconditionally
secured as to principal and interest by letters of credit or other credit
support agreements from major banks. The interest rates are adjustable and
are based on bank prime rates or other interest rate adjustment indeces.
The rate shown represents the rate in effect at February 28, 2005. The
maturity date shown reflects next rate change date.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
GNMA - Government National Mortgage Association
LLC - Limited Liability Corporation
LP - Limited Partnership
PLC - Public Limited Company
SA - Sociedad Anonyma (French, Spanish)
VALIANT GENERAL MONEY MARKET PORTFOLIO
Commercial Paper 53.9%
Corporate Obligations 11.4
Certificate of Deposit 3.4
Municipal Notes and Bonds 5.2
United States Government Agency 1.7
Repurchase Agreement 24.5
-----
100.1
Liabilities In Excess of Other Assets (0.1)
-----
100.0%
=====
See notes to financial statements.
10
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
FEBRUARY 28, 2005 (UNAUDITED)
ASSETS:
Investments, at value (cost $592,740,019) $447,340,019
Repurchase agreements 145,400,000
------------
Total investments 592,740,019
Cash 59,728
Receivables:
Securities sold 188,929,285
Capital shares 6,656,952
Interest 427,455
Other assets 5
------------
TOTAL ASSETS 788,813,444
LIABILITIES:
Payables:
Securities Purchased $195,396,396
Dividends 892,087
Capital shares 202,940
Accrued expenses and other liabilities:
Investment manager 79,447
Distribution and shareholder servicing 43,325
------------
TOTAL LIABILITIES 196,614,195
------------
NET ASSETS $592,199,249
============
COMPOSITION OF NET ASSETS:
Capital $592,281,670
Accumulated net realized loss from
investment transactions (82,421)
------------
NET ASSETS $592,199,249
============
Class A Shares
Net assets $500,658,240
Shares outstanding 500,722,660
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class B Shares
Net assets $ 34,572
Shares outstanding 34,581
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class D Shares
Net assets $ 54,152,194
Shares outstanding 54,159,557
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class E Shares
Net assets $ 37,354,243
Shares outstanding 37,364,872
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS ENDED FEBRUARY 28, 2005 (UNAUDITED)
INVESTMENT INCOME:
Interest $ 4,775,459
------------
TOTAL INVESTMENT INCOME 4,775,459
EXPENSES:
Investment manager $ 450,907
Distribution and shareholder servicing:
Class A Shares 613,326
Class B Shares 6,320
Class D Shares 143,303
Class E Shares 163,640
Trustees fees 8,732
------------
Total expenses before contractual
fee reimbursements 1,386,228
Contractual fee waivers and
expense reimbursements (623,863)
------------
NET EXPENSES 762,365
------------
NET INVESTMENT INCOME 4,013,094
------------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ 4,013,094
============
See notes to financial statements.
11
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE
FEBRUARY 28, 2005 YEAR ENDED
(UNAUDITED) AUGUST 31, 2004
----------------- -----------------
INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income $ 4,013,094 $ 4,041,705
Net realized loss from investment transactions -- (1,354)
----------------- -----------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 4,013,094 4,040,351
----------------- -----------------
DIVIDENDS:
Net investment income:
Class A Shares (3,371,388) (3,564,854)
Class B Shares (26,591) (45,082)
Class D Shares (397,200) (333,462)
Class E Shares (217,914) (98,307)
----------------- -----------------
TOTAL DIVIDENDS TO SHAREHOLDERS (4,013,093) (4,041,705)
----------------- -----------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL TRANSACTIONS 224,046,757 (139,806,527)
----------------- -----------------
NET INCREASE (DECREASE) IN NET ASSETS 224,046,758 (139,807,881)
NET ASSETS:
Beginning of period 368,152,491 507,960,372
----------------- -----------------
End of period $ 592,199,249 $ 368,152,491
================= =================
See notes to financial statements.
12
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS A SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.009 0.010 0.013 0.022 0.05 0.06
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.009) (0.010) (0.013) (0.022) (0.05) (0.06)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (A) 0.94% 1.01% 1.29% 2.24% 5.52% 5.97%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $500,658 $256,923 $364,392 $357,676 $380,513 $394,118
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.56%(b) 0.55% 0.55% 0.55% 0.55% 0.55%
Ratio of expenses to average net assets 0.20%(b) 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of net investment income to average
net assets 1.93%(b) 0.99% 1.28% 2.22% 5.36% 5.89%
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS B SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.008 0.008 0.010 0.019 0.05 0.06
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.008) (0.008) (0.010) (0.019) (0.05) (0.06)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (A) 0.81% 0.76% 1.04% 1.98% 5.25% 5.71%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 35 $ 5,064 $ 10,620 $ 15,719 $ 9,169 $ 4,793
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.55%(b) 0.50% 0.55% 0.55% 0.55% 0.55%
Ratio of expenses to average net assets 0.45%(b) 0.45% 0.45% 0.45% 0.45% 0.45%
Ratio of net investment income to average
net assets 1.47%(b) 0.74% 1.03% 1.91% 4.91% 5.61%
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes
reinvestment of dividends. Total returns for periods less than one full
year are not annualized.
(b) Annualized.
See notes to financial statements.
13
THE VALIANT FUND
GENERAL MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS D SHARES
- --------------------------------------------------------------------------------
FOR THE FOR THE PERIOD
SIX MONTHS ENDED FOR THE YEAR ENDED AUGUST 31, SEPTEMBER 27, 1999
FEBRUARY 28, 2005 ----------------------------------------------- TO AUGUST 31, 2000
(UNAUDITED) 2004 2003 2002 2001 (A)
----------------- -------- -------- -------- -------- ------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.007 0.005 0.007 0.016 0.05 0.05
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.007) (0.005) (0.007) (0.016) (0.05) (0.05)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (B) 0.69% 0.50% 0.79% 1.73% 4.99% 5.10%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 54,152 $ 59,116 $ 74,943 $ 40,662 $ 16,861 $ 10,121
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.70%(c) 0.70% 0.70% 0.70% 0.70% 0.70%(c)
Ratio of expenses to average net assets 0.70%(c) 0.70% 0.70% 0.70% 0.70% 0.70%(c)
Ratio of net investment income to average
net assets 1.39%(c) 0.50% 0.73% 1.55% 4.81% 5.53%(c)
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS E SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.005 0.002 0.005 0.014 0.05 0.05
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.005) (0.002) (0.005) (0.014) (0.05) (0.05)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (B) 0.54% 0.20% 0.49% 1.42% 4.68% 5.13%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 37,354 $ 47,050 $ 58,005 $ 83,742 $ 99,984 $ 89,270
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 1.00%(c) 1.00% 1.00% 1.00% 1.00% 1.00%
Ratio of expenses to average net assets 1.00%(c) 1.00% 1.00% 1.00% 1.00% 1.00%
Ratio of net investment income to average
net assets 1.07%(c) 0.20% 0.51% 1.45% 4.23% 5.18%
(a) Commencement of operations.
(b) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes
reinvestment of dividends. Total returns for periods less than one full
year are not annualized.
(c) Annualized.
See notes to financial statements.
14
VALIANT TAX-EXEMPT MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments
February 28, 2005 (unaudited)
MATURITY PRINCIPAL
RATE DATE AMOUNT VALUE
-------- ---------- ------------ ------------
COMMERCIAL PAPER - 15.9%
FLORIDA - 14.7%
City of Gainesville 1.85% 3/2/2005 $ 5,000,000 $ 5,000,000
Jacksonville Health Facility 1.85 4/5/2005 5,000,000 5,000,000
Sarasota County Public Hospital, LOC Suntrust Bank 1.92 3/1/2005 4,050,000 4,050,000
Sunshine State, Series A 1.92 3/1/2005 2,000,000 2,000,000
Sunshine State, Series H 1.97 4/4/2005 5,000,000 5,000,000
------------
21,050,000
------------
PENNSYLVANIA -1.2%
Delaware County 1.75 3/3/2005 1,700,000 1,700,000
------------
TOTAL COMMERCIAL PAPER (AMORTIZED COST $22,750,000) 22,750,000
------------
MUNICIPAL BONDS AND NOTES - 20.8%
FLORIDA - 6.0%
Brevard County School District 3.00 6/30/2005 5,000,000 5,022,494
Orange County Industrial Development Authority 1.75 4/1/2005 1,500,000 1,500,000
Palm Beach County School Distric 3.00 9/28/2005 2,000,000 2,014,770
------------
8,537,264
------------
ILLINOIS - 3.5%
State of Illinois 3.00 6/3/2005 5,000,000 5,012,050
------------
INDIANA - 2.8%
Plainfield Community High School Building Corp 2.65 10/31/2005 4,000,000 4,000,000
------------
KANSAS - 2.1%
Wyandotte County-Kansas City Unified Governmen 2.80 11/1/2005 3,000,000 3,015,699
------------
LOUISIANA - 1.4%
Plaquemines LA Port Harbor and Terminal District Port Facility
Revenue, Project 1.08 3/15/2005 2,000,000 2,000,000
------------
TEXAS - 3.2%
Houston Independent School District 1.73 6/15/2005 3,000,000 3,000,000
Richardson Independent School District 1.10 4/1/2005 1,500,000 1,500,000
------------
4,500,000
------------
OTHER TERRITORIES - 1.8%
Puttable Floating Option Tax-Exempt Receipt 1.90 6/16/2005 2,620,000 2,620,000
------------
TOTAL MUNICIPAL BONDS AND NOTES (AMORTIZED COST $29,685,013) 29,685,013
------------
VARIABLE MUNICIPAL BONDS* - 61.5%
FLORIDA - 58.3%
ABN AMRO Munitops Certificate Trust 1.90 3/2/2005 3,650,000 3,650,000
Broward County, HFA, Multi-Family, LOC Bank On 1.85 3/2/2005 2,600,000 2,600,000
Collier County, Health Care Facilities IDR 1.85 3/3/2005 5,900,000 5,900,000
Collier County, Health Care Facilities IDR 1.86 3/4/2005 5,000,000 5,000,000
Collier County, Health Care Facilities IDR, LOC Fifth Third Ban 1.86 3/4/2005 1,900,000 1,900,000
Florida HFA, Buena Vista, Multi-Famil 1.80 3/2/2005 1,000,000 1,000,000
Florida HFA, Multi-Family, LOC Credit Suisse First Bosto 1.91 3/2/2005 2,400,000 2,400,000
Florida Housing Finance Corp., Charleston, Series I-A,
Multi-Family Revenu 1.87 3/3/2005 2,375,000 2,375,000
Florida Housing Finance Corp., Cypress Lake, Multi-Family Revenu 1.87 3/3/2005 3,500,000 3,500,000
Florida State Municipal Power Agency Revenue, Stanton Projec 1.87 3/2/2005 1,000,000 1,000,000
Halifax Hospital Medical Center, Health Care Facilities Revenu 1.88 3/2/2005 1,200,000 1,200,000
JEA District Energy System Revenue, Series A 1.82 3/3/2005 3,900,000 3,900,000
Jacksonville Economic Development Commission Health Care
Facilities Revenue, Series 1.85 3/3/2005 2,000,000 2,000,000
Jacksonville Health Facilities Authority Hospital Revenu 1.83 3/2/2005 2,400,000 2,400,000
Lakeland Energy Systems Revenue, Series A 1.86 3/2/2005 3,000,000 3,000,000
Marion County Hospital District Revenue 1.89 3/2/2005 5,375,000 5,375,000
Orlando Utilities Commission Water & Electric Revenue, Series B 1.83 3/2/2005 2,500,000 2,500,000
Orlando Utilities Commission Water & Electric Revenue, Series A 1.86 3/2/2005 4,000,000 4,000,000
Palm Beach County Revenue, Norton Gallery, Inc. Projec 1.89 3/2/2005 4,000,000 4,000,000
See notes to financial statements.
15
VALIANT TAX-EXEMPT MONEY MARKET PORTFOLIO
Schedule of Portfolio Investments
February 28, 2005 (unaudited)
MATURITY PRINCIPAL
RATE DATE AMOUNT VALUE
-------- ---------- ------------ ------------
VARIABLE MUNICIPAL BONDS* (CONTINUED)
FLORIDA (CONTINUED)
Palm Beach County Florida Revenue Bond 1.80% 3/3/2005 $ 2,500,000 $ 2,500,000
Polk County School Board COP, Series A 1.85 3/3/2005 2,000,000 2,000,000
Polk County Utility System Revenue 1.89 3/3/2005 3,495,000 3,495,000
Port Orange Palmer College Project Revenue 1.87 3/3/2005 8,500,000 8,500,000
St. Johns County, HFA Multi-Family 1.88 3/2/2005 7,600,000 7,600,000
Tampa Health Care Facilities Revenue (Lifelink Foundation, Inc.
Project 1.87 3/2/2005 1,500,000 1,500,000
------------
83,295,000
------------
PUERTO RICO - 3.2%
Puerto Rico Electric Power Authority 1.83 3/2/2005 3,000,000 3,000,000
Commonwealth Infrastructure Financing Authorit 1.86 3/3/2005 1,495,000 1,495,000
------------
4,495,000
------------
TOTAL VARIABLE MUNICIPAL BONDS (AMORTIZED COST $87,790,000) 87,790,000
------------
TOTAL INVESTMENTS (AMORTIZED COST $140,225,013) (A) - 98.2% 140,225,013
OTHER ASSETS LESS LIABILITIES - 1.8% 2,605,481
------------
TOTAL NET ASSETS - 100% $142,830,494
============
- ----------
* Variable rate investment. Securities payable on demand at par including
accrued interest (usually within seven days notice) and unconditionally
secured as to principal and interest by letters of credit or other credit
support agreements from major banks . The interest rates are adjustable
and are based on bank prime rates or other interest rate adjustment
indices. The rate shown represents the rate in effect at February 28,
2005. The maturity date shown reflects next rate change date
(a) Cost and value for federal income tax and financial reporting purposes are
the same
COP - Certificates of Participation
HFA - Housing Finance Authorit
IDR - Industrial Development Revenue
LOC - Letter of Credit
TAN - Tax Anticipation Note
VALIANT TAX-EXEMPT MONEY MARKET PORTFOLIO
Commercial Paper 15.9%
Variable Municipal Bonds 61.5
Municipal Bonds and Notes 20.8
-----
98.2
Other Assets less Liabilities 1.8
-----
100.0%
=====
See notes to financial statements.
16
THE VALIANT FUND
TAX-EXEMPT MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
FEBRUARY 28, 2005 (UNAUDITED)
ASSETS:
Investments, at value (cost $140,225,013) $140,225,013
Receivables:
Interest 360,972
Securities sold 7,902,829
Capital shares 1,284,903
Other assets 773
------------
TOTAL ASSETS 149,774,490
------------
LIABILITIES:
Payables:
Due to custodian $ 1,035,440
Securities purchased 5,012,050
Capital shares 670,399
Dividends 199,236
Accrued expenses and other liabilities:
Investment manager 24,167
Distribution and shareholder servicing 2,704
------------
TOTAL LIABILITIES 6,943,996
------------
NET ASSETS $142,830,494
============
COMPOSITION OF NET ASSETS:
Capital $142,977,742
Accumulated net realized loss from
investment transactions (147,248)
------------
NET ASSETS $142,830,494
============
Class A Shares
Net Assets $132,390,356
Shares outstanding 132,528,212
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
Class B Shares
Net Assets $ 10,440,139
Shares outstanding 10,449,530
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
============
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
FOR THE SIX MONTHS ENDED FEBRUARY 28, 2005 (UNAUDITED)
INVESTMENT INCOME:
Interest $ 1,529,985
------------
TOTAL INVESTMENT INCOME 1,529,985
EXPENSES:
Investment manager $ 188,452
Distribution and shareholder servicing:
Class A Shares 309,208
Class B Shares 20,583
Trustees fees 4,033
------------
Total expenses before contractual
fee reimbursements 522,276
Contractual fee waivers and
expense reimbursements (319,122)
------------
NET EXPENSES 203,154
------------
NET INVESTMENT INCOME 1,326,831
------------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS $ 1,326,831
============
See notes to financial statements.
17
THE VALIANT FUND
TAX-EXEMPT MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE
FEBRUARY 28, 2005 YEAR ENDED
(UNAUDITED) AUGUST 31, 2004
----------------- -----------------
INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income $ 1,326,831 $ 1,333,815
----------------- -----------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS 1,326,831 1,333,815
----------------- -----------------
DIVIDENDS:
Net investment income:
Class A Shares (1,260,000) (1,297,979)
Class B Shares (66,831) (35,836)
Class D Shares -- --
----------------- -----------------
TOTAL DIVIDENDS TO SHAREHOLDERS (1,326,831) (1,333,815)
----------------- -----------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL TRANSACTIONS 5,242,373 (4,930,918)
----------------- -----------------
NET INCREASE (DECREASE) IN NET ASSETS 5,242,373 (4,930,918)
NET ASSETS:
Beginning of period 137,588,121 142,519,039
----------------- -----------------
End of period $ 142,830,494 $ 137,588,121
================= =================
See notes to financial statements.
18
THE VALIANT FUND
TAX-EXEMPT MONEY MARKET PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS A SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE YEARS ENDED AUGUST 31,
FEBRUARY 28, 2005 ------------------------------------------------------------
(UNAUDITED) 2004 2003 2002 2001 2000
----------------- -------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
INVESTMENT ACTIVITIES
Net investment income 0.007 0.008 0.014 0.015 0.03 0.04
-------- -------- -------- -------- -------- --------
DIVIDENDS
Net investment income (0.007) (0.008) (0.014) (0.015) (0.03) (0.04)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
TOTAL RETURN (A) 0.70% 0.83% 1.03% 1.49% 3.42% 3.67%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $132,390 $123,388 $142,519 $174,104 $141,464 $207,183
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.55%(b) 0.55% 0.55% 0.55% 0.55% 0.55%
Ratio of expenses to average net assets 0.20%(b) 0.20% 0.20% 0.20% 0.20% 0.20%
Ratio of net investment income to average
net assets 1.43%(b) 0.83% 1.02% 1.47% 3.39% 3.57%
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS B SHARES
- --------------------------------------------------------------------------------
FOR THE
SIX MONTHS ENDED FOR THE PERIOD
FEBRUARY 28, 2005 FEBRUARY 25, 2004(C)
(UNAUDITED) TO AUGUST 31, 2004
----------------- -------------------
NET ASSET VALUE, BEGINNING OF PERIOD $ 1.000 $ 1.000
-------- --------
INVESTMENT ACTIVITIES
Net investment income 0.006 0.003
DIVIDENDS
Net investment income (0.006) (0.003)
-------- --------
NET ASSET VALUE, END OF PERIOD $ 1.000 $ 1.000
======== ========
TOTAL RETURN (A) 0.57% 0.31%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $ 10,440 $ 14,200
Ratio of expenses to average net assets,
before fee waivers and / or expense
reimbursements 0.55%(b) 0.55%(b)
Ratio of expenses to average net assets 0.45%(b) 0.45%(b)
Ratio of net investment income to average
net assets 1.14%(b) 0.60%(b)
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes
reinvestment of dividends. Total returns for periods less than one full
year are not annualized.
(b) Annualized.
(c) Commencement of share class.
See notes to financial statements.
19
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2005 (UNAUDITED)
1. ORGANIZATION:
The U.S. Treasury Money Market Portfolio, General Money Market
Portfolio, Tax-Exempt Money Market Portfolio, and U.S. Treasury Income
Portfolio are separate portfolios of The Valiant Fund. The Valiant Fund
(the "Trust") is a Massachusetts business trust, organized on January 29,
1993 and is registered under the Investment Company Act of 1940, as
amended (the "Act"), as an open-end management investment company. The
Trust is authorized to offer five classes of shares: Class A, Class B,
Class C (has not commenced operations), Class D and Class E. The five
classes are identical, except as to the services offered to, and the
expenses borne, by each class. This report covers U.S. Treasury Money
Market Portfolio, General Money Market Portfolio, and Tax-Exempt Money
Market Portfolio (referred to individually as a "Portfolio" and
collectively as the "Portfolios") for the six months ending February 28,
2005. A separate report is issued for the U.S. Treasury Income Portfolio
for the six months ending February 28, 2005.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies
followed by the Portfolios in the preparation of their financial
statements. The policies are in conformity with generally accepted
accounting principles in the United States of America. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of income and expenses
for the period. Actual results could differ from those estimates.
SECURITY VALUATION:
Investments of the Portfolios are valued at amortized cost, which
approximates value. Under the amortized cost method, discount or premium,
if any, is accreted or amortized, respectively, on a straight-line basis
to the maturity of the security.
SECURITIES TRANSACTIONS AND RELATED INCOME:
Securities transactions are recorded on trade date. Security gains
and losses are calculated on the identified cost basis. Interest income is
recognized on the accrual basis and includes, where applicable, the
amortization or accretion of a premium or a discount.
REPURCHASE AGREEMENTS:
Each Portfolio may enter into repurchase agreements with an entity
whose creditworthiness has been reviewed and found satisfactory by the
Portfolios' Sub-Advisor, Reich & Tang Asset Management L.P. The repurchase
price generally equals the price paid by a Portfolio plus interest
negotiated on the basis of current short-term rates, which may be more or
less than the rate on the underlying portfolio securities. The seller,
under a repurchase agreement, is required to maintain the appropriate
collateral levels held pursuant to the agreement, with a market value
equal to or greater than the repurchase price (including accrued
interest). Collateral subject to repurchase agreements is held by the
Portfolios' custodian, either physically or in book entry form.
EXPENSE ALLOCATION:
Expenses directly attributable to a Portfolio are charged to that
Portfolio. Trust expenses are allocated proportionately among each
Portfolio within the Trust in relation to the net assets of each Portfolio
or another reasonable basis. Expenses specific to a class are charged to
that class.
20
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 2005
DIVIDENDS TO SHAREHOLDERS:
The Portfolios' declare all net investment income daily as dividends
to their shareholders and distribute such dividends monthly. Additional
dividends are also paid to the Portfolios' shareholders to the extent
necessary to avoid the federal excise tax on certain undistributed income
and net realized gains of registered investment companies.
The amount of dividends from net investment income and net realized gains
are determined in accordance with U.S. income tax regulations, which may
differ from the U.S. generally accepted accounting principles. These
"book/tax" differences are either considered temporary or permanent in
nature. To the extent these differences are permanent in nature, such
amounts are reclassified among the components of net assets; temporary
differences do not require reclassification.
FEDERAL TAXES:
Each Portfolio is a separate taxable entity for federal tax
purposes. Each Portfolio has qualified and intends to qualify each year as
a "regulated investment company" under Subchapter M of the Internal
Revenue Code, as amended, and distribute substantially all of its taxable
net investment income and net realized gains, if any, to their
shareholders. Accordingly, no provision for federal income excise tax is
required.
3. RELATED PARTY TRANSACTIONS:
INVESTMENT ADVISER:
Integrity Management & Research, Inc. (the "Manager"), a wholly
owned subsidiary of Integrity Investments, Inc., serves as the Investment
Adviser to the Trust. The Trust pays the Manager a fee, computed daily and
paid monthly, at the annual rate of 0.20% of the average daily net assets
of each Portfolio.
Under terms of the Management Agreement, all expenses incurred by
the Portfolios are paid directly by the Manager, except for distribution
and shareholder servicing fees, Trustee fees and other miscellaneous
non-recurring fees.
CUSTODIAN:
The Bank of New York, ("Custodian") is the Custodian for each
Portfolio under custodian agreements with respect to each Portfolio.
The Bank of New York also provides fund accounting and
administrative services pursuant to a Fund Accounting Agreement Dated
September 1, 2001 (the "Fund Accounting Agreement") between the Trust and
The Bank of New York. The Fund Accounting Agreement's provisions for
termination, limitation of liability and indemnification are similar to
the Trust's Administration Agreement. Under the Fund Accounting Agreement,
The Bank of New York maintains all Trust books and records required under
Rule 31a-1 under the Investment Company Act of 1940, as amended, performs
daily accounting services and provides additional fund reporting and
record keeping services.
21
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 2005
DISTRIBUTION AND SHAREHOLDER SERVICING PLAN:
Integrity Investments, Inc. (the "Distributor"), an affiliate of the
manager, acts as exclusive distributor of the Trust's shares. The Trust
has adopted distribution and shareholder servicing plans for each class of
shares offered (together, the "Plans") pursuant to Rule 12b-1 of the 1940
Act. For its services, the Distributor is authorized to receive a fee,
computed daily and paid monthly, based on the average daily net assets of
each class, at the following annual percentage rates: CLASS FEE RATE Class
A Shares 0.35% Class B Shares 0.35 Class C Shares 0.65 Class D Shares 0.50
Class E Shares 0.80
EXPENSE LIMITATIONS:
The Portfolios' Adviser and Distributor have contractually agreed to
reimburse expenses and waive certain distribution fees necessary to limit
total expenses to the following rates until December 31, 2005:
CLASS EXPENSE LIMITATION
----- ------------------
Class A Shares 0.20%
Class B Shares 0.45
Class C Shares 0.85
Class D Shares 0.70
Class E Shares 1.00
FEE REIMBURSEMENTS:
Expenses reimbursed and fees waived by the Adviser and Distributor
are set forth on each Portfolio's Statement of Operations.
For the six months ending February 28, 2005, the Adviser and
Distributor waived $46,640 of fees and expenses for the U.S. Treasury
Money Market Portfolio. These expenses related to $560 of fees
attributable to Class A, $38,846 attributable to Class B, and all Trustees
fees of $7,234 incurred by the Portfolio during the year.
For the six months ending February 28, 2005, the Adviser and
Distributor waived $623,863 of fees and expenses for the General Money
Market Portfolio. These expenses related to $613,326 of fees attributable
to Class A, $1,805 attributable to Class B, and all Trustees fees of
$8,732 incurred by the Portfolio during the year.
For the six months ending February 28, 2005, the Adviser and
Distributor waived $319,122 of fees and expenses for the Tax-Exempt Money
Market Portfolio. These expenses related to $309,208 of fees attributable
to Class A, $5,881 attributable to Class B, and all Trustees fees of
$4,033 incurred by the Portfolio during the year.
22
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 2005
4. CAPITAL SHARE TRANSACTIONS:
Each class is authorized to issue an unlimited number of shares with
no par value. Transactions in capital and shares of beneficial interest by
class for the Portfolios for the six months ended February 28, 2005 and
year ended August 31,2004 are listed below (amounts represent shares and
dollars):
U.S. TREASURY MONEY MARKET GENERAL MONEY MARKET TAX-EXEMPT MONEY MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
---------------------------------- ---------------------------------- ----------------------------------
FOR THE FOR THE FOR THE FOR THE FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
FEBRUARY 28, 2005 AUGUST 31, 2004 FEBRUARY 28, 2005 AUGUST 31, 2004 FEBRUARY 28, 2005 AUGUST 31, 2004
---------------------------------- ---------------------------------- ----------------------------------
CLASS A SHARES:
Issued 1,974,640 5,702,303 1,205,839,874 1,952,747,763 439,345,509 667,041,719
Reinvested 50 63 364 478 7 8
Redeemed (792,952) (12,525,863) (962,089,341) (2,060,220,432) (430,339,196) (686,186,122)
---------------------------------- ---------------------------------- ----------------------------------
Net increase (decrease)
in Class A Shares 1,181,738 (6,823,497) 243,750,897 (107,472,191) 9,006,320 (19,144,395)
---------------------------------- ---------------------------------- ----------------------------------
CLASS B SHARES:
Issued 169,866,176 373,802,150 12,999,995 36,476,675 10,358,875 26,356,643
Reinvested 36,304 37,383 39 -- 3,366 --
Redeemed (196,747,948) (410,825,366) (18,030,176) (42,034,706) (14,126,188) (12,143,166)
---------------------------------- ---------------------------------- ----------------------------------
Net increase (decrease)
in Class B Shares (26,845,468) (36,985,833) (5,030,142) (5,558,031) (3,763,947) 14,213,477
---------------------------------- ---------------------------------- ----------------------------------
CLASS D SHARES:
Issued 133,381,465 658,004,478 17,083,436 44,941,959 -- --
Reinvested -- -- 7,289 13,940 -- --
Redeemed (154,330,715) (746,546,357) (22,062,237) (60,779,354) -- --
---------------------------------- ---------------------------------- ----------------------------------
Net decrease
in Class D Shares (20,949,250) (88,541,879) (4,971,512) (15,823,455) -- --
---------------------------------- ---------------------------------- ----------------------------------
CLASS E SHARES:
Issued 18,568,819 111,848,476 72,440,632 56,739,821 -- --
Reinvested 5 1 306 2 -- --
Redeemed (22,254,887) (125,386,366) (82,143,424) (67,692,673) -- --
---------------------------------- ---------------------------------- ----------------------------------
Net decrease in
Class E Shares (3,686,063) (13,537,889) (9,702,486) (10,952,850) -- --
---------------------------------- ---------------------------------- ----------------------------------
NET INCREASE
(DECREASE) IN SHARE
TRANSACTIONS (50,299,043) (145,889,098) 224,046,757 (139,806,527) 5,242,373 (4,930,918)
================================== ================================== ==================================
23
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 2005
5. SECURITIES LENDING:
Under an agreement with the Custodian, the Portfolios can lend their
securities to approved brokers, dealers and other financial institutions.
The Portfolios also continue to receive interest on the securities loaned.
Loans are collateralized by cash, in an amount at least equal to the
market value of the securities loaned plus accrued interest. The cash
collateral is received and is invested in a money market account with the
Custodian. A portion of the income generated by the investment of the
collateral, net of any rebates paid by the Custodian to borrowers, is
remitted to the Custodian as lending agent, and the remainder is paid to
the Portfolios. Generally, in the event of counterparty default, the
Portfolios have the right to use the collateral to offset losses incurred.
For the six months ending February 28, 2005, the Treasury Money Market
Portfolio includes $25,902,775 of U.S. Treasury obligations on loan
collateralized by $26,271,521 invested in Bank of New York Institutional
Cash Reserves Fund. There were no outstanding securities on loan for
General Money Market Portfolio and Tax-Exempt Portfolio.
6. CONCENTRATION OF CREDIT RISK:
As of February 28, 2005, approximately 79.0% of the Tax-Exempt Money
Market Portfolio was invested in obligations of political subdivisions of
the State of Florida and, accordingly, is subject to the credit risk
associated with the non-performance of such issuers. Approximately 93.8%
of these investments are further secured, as to principal and interest, by
credit enhancements such as letters of credit, municipal bond insurance,
and guarantees issued by financial institutions.
7. FEDERAL TAX INFORMATION:
All of the dividends paid for the six months ended February 28, 2005
and the year ended August 31, 2004 by the General Money Market Portfolio
and the U.S. Treasury Money Market Portfolio are ordinary income for
federal income tax purposes.
During the six months ended February 28, 2005 and the year ended August
31, 2004, all of the distributions paid by the Tax-Exempt Money Market
Portfolio have been designated tax-exempt income distributions.
Undistributed net investment income differs from financial statement and
tax purposes primarily due to the timing of dividend payments.
For federal income tax purposes, the following Portfolios have capital
loss carryforwards as of August 31, 2004, which are available to offset
future realized gains, if any:
NAME AMOUNT EXPIRES
-------------------------- ----------------------------
U.S. Treasury Money Market $ 229,819 2008
21,859 2009
------------
$ 251,678
============
General Money Market $ 29,268 2005
51,799 2008
------------
$ 81,067
============
Tax-Exempt Money Market $ 1,943 2005
12,059 2006
2,545 2008
42,330 2009
------------
$ 58,877
============
24
THE VALIANT FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FEBRUARY 28, 2005
Capital losses incurred after October 31 ("post-October" losses) within
the taxable year are deemed to arise on the first business day of the fund's
next taxable year. The Fund indicated incurred and will elect to defer net
capital losses noted during 2004. The General Money Market Fund will defer
post-October losses in the amount of $1,354.
25
MANAGEMENT OF THE TRUST
The trustees and officers of the Trust and their principal occupations during
the past five years are as follows:
RICHARD F. CURCIO PRESIDENT, TRUSTEE, CHAIRMAN OF THE BOARD
Founded Integrity Investments, Inc. (a broker/dealer) and Integrity Management &
Research, Inc.(an investment adviser) in 1992, and is currently President and
Director of each. Senior Vice President/Regional Manager for Fidelity
Institutional Services Company from 1987 to 1992. Associated with Fidelity
Distributors from 1979 to 1992.
JOHN S. CULBERTSON TRUSTEE
Retired. Trust Consultant with Fidelity Investments Institutional Services Co.
from 1990 to 1993.
RUFUS C. CUSHMAN JR. TRUSTEE
Retired. Money Manager with Fidelity Management & Research Corp. From 1968
through 1994.
H. WILLIS DAY TRUSTEE
Retired. Former Senior Vice President of Southeast Bank, FLA, N.A.
ROGER F. DUMAS TRUSTEE
Private investor since 1987.
KENNETH J. PHELPS TRUSTEE
President, Principal and Director of Reliance Trust Company, Atlanta, GA since
1992. Chairman, Chief Executive Officer and Director, C&S/Sovran Trust Company,
Inc. from 1987 to 1992.
DENIS R. CURCIO VICE PRESIDENT, SECRETARY AND TREASURER
Mr. Curcio joined Integrity Investments, Inc. the distributor of The Valiant
Fund in June of 1998 after graduating from Jacksonville University with a BS in
Finance. Aged 28, Denis is responsible for oversight and administration of The
Valiant Fund.
26
BRENDEN R. CURCIO VICE PRESIDENT
Mr. Curcio joined Integrity Investments, Inc., the distributor of The Valiant
Fund in June of 1994 after graduating from Stetson University with a BBA in
Finance. Aged 33, Brenden is responsible for institutional sales of The Valiant
Fund in the Northeast and Midwest.
PROXY VOTING POLICIES AND PROCEDURES
You may obtain a description of the Trusts' proxy voting policies and
procedures, without charge, upon request, by calling Integrity Investments, Inc.
at 1-800-828-2176 or by going to the Securities and Exchange Commission's
website at www.sec.gov.
Information regarding how the Trust voted proxies relating to portfolio
securities, if applicable, during the most recent 12-month period ended June 30,
is also available, without charge and upon request, by calling Integrity
Investments, Inc. at 1-800-828-2176 or accessing the Trusts' Form N-PX on the
Securities and Exchange Commission's website at www.sec.gov. Proxy Voting
Policies and Procedures
QUARTERLY PORTFOLIOS
The Trust files its complete schedule of portfolio holdings with the Commission
for the first and third quarters of each fiscal year on Form N-Q. The Trust's
Forms N-Q are available on the Commission's website at www.sec.gov. The Trust's
Forms N-Q may also be reviewed and copied at the Commission's Public Reference
Room in Washington, DC; information on the operation of the Public Reference
Room may be obtained by calling (800)-SEC-0330.
27
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THE VALIANT FUND
U.S. TREASURY INCOME PORTFOLIO
SEMI-ANNUAL REPORT
FEBRUARY 28, 2005
THE VALIANT FUND
U.S. TREASURY INCOME PORTFOLIO
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
FEBRUARY 28, 2005 *(UNAUDITED)
ASSETS:
Cash $ 985
----------
TOTAL ASSETS 985
LIABILITIES:
Accrued expenses and other liabilities:
Investment manager $ 364
----------
TOTAL LIABILITIES 364
----------
NET ASSETS $ 621
==========
COMPOSITION OF NET ASSETS:
Capital $ 622
Undistributed net investment income 84
Accumulated net realized loss from
investment transactions (85)
----------
NET ASSETS $ 621
==========
Class A Shares
Net Assets $ 621
Shares outstanding 622
Net Asset Value, Offering Price and
Redemption Price per share $ 1.00
==========
* The portfolio has been inactive since 2001.
1
THE VALIANT FUND
U.S. TREASURY INCOME PORTFOLIO
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS, CLASS A SHARES
- --------------------------------------------------------------------------------
For the six
months ended
February 28, For the years ended 1999 (F)
2005(a) --------------------------------------------------------
(unaudited) 2004(b) 2003(c) 2002(d) 2001(e) 2000(f)
----------- ------- ------- ------- ------- -------
Net Asset Value, Beginning of Period $1.000 $1.000 $1.000 $1.000 $ 1.00 $ 1.00
------ ------ ------ ------ ------ ------
Investment Activities
Net investment income -- -- -- -- 0.01 0.01
Net realized gain from investment transactions -- -- -- -- -- --
------ ------ ------ ------ ------ ------
Total from investment activities -- -- -- -- 0.01 0.01
------ ------ ------ ------ ------ ------
Dividends
Net investment income -- -- -- -- (0.01) (0.01)
------ ------ ------ ------ ------ ------
Total dividends -- -- -- -- (0.01) (0.01)
------ ------ ------ ------ ------ ------
Net Asset Value, End of Period $1.000 $1.000 $1.000 $1.000 $ 1.00 $ 1.00
====== ====== ====== ====== ====== ======
Total Return -- -- -- -- 0.68%(g) 0.51%(g)
Ratios/Supplementary Data:
Net Assets at end of period (000) $ 1 $ 1 $ 1 $ 1 $ 1 $ 1
Ratio of expenses to average net assets -- -- -- -- 0.20%(h) 0.20%(h)
Ratio of net investment income to average net assets -- -- -- -- 5.11%(h) 4.21%(h)
* Less than $0.005 per share.
(a) The Portfolio did not operate during the six months ended February 28,
2005.
(b) The Portfolio did not operate during the year ended August 31, 2004.
(c) The Portfolio did not operate during the year ended August 31, 2003.
(d) The Portfolio did not operate during the year ended August 31, 2002.
(e) The Portfolio operated from December 6, 2000 to January 24, 2001.
(f) The Portfolio operated from December 7, 1999 to January 19, 2000.
(g) Not Annualized.
(h) Annualized.
2
THE VALIANT FUND
U.S. TREASURY INCOME PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
FEBRUARY 28, 2005 (UNAUDITED)
1. ORGANIZATION:
The Valiant Fund (the "Trust") is a Massachusetts business trust,
organized on January 29, 1993 and is registered under the Investment
Company Act of 1940, as amended (the "Act"), as an open-end management
investment company. A separate annual report is issued for the U.S.
Treasury Money Market Portfolio, General Money Market Portfolio and
Tax-Exempt Money Market Portfolio. This report covers the U.S. Treasury
Income Portfolio (hereinafter referred to as "Portfolio") for the six
months ending February 28, 2005, during which period the portfolio did not
conduct operations. As the Portfolio did not have any operations during
the six months ended February 28,2005 or the year ended August 31, 2004, a
Statement of Operations and Statement of Changes in Net Assets has not
been presented.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies
followed by the Portfolio in the preparation of its financial statements.
The policies are in conformity with generally accepted accounting
principles in the United States of America. The preparation of financial
statements requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for
the period. Actual results could differ from those estimates.
SECURITY VALUATION:
Investments of the Portfolio are valued at amortized cost, which
approximates value. Under the amortized cost method, discount or premium,
if any, is accreted or amortized, respectively, on a straight-line basis
to the maturity of the security. During the six months ending February 28,
2005, the Portfolio did not engage in any investment activities.
SECURITIES TRANSACTIONS AND RELATED INCOME:
Securities transactions are recorded on trade date. Security gains
and losses are calculated on the identified cost basis. Interest income is
recognized on the accrual basis and includes, where applicable, the
amortization or accretion of a premium or a discount. During the six
months ending February 28, 2005, the Portfolio did not engage in any
investment activities nor did it receive any related income.
EXPENSE ALLOCATION:
Expenses directly attributable to a portfolio are specifically
identified and charged. Trust expenses are allocated proportionately among
each of the Portfolios within the Trust in relation to the net assets of
each portfolio or another reasonable basis. Expenses specific to a class
are charged to that class. There were no expenses incurred by the
Portfolio during the past six months.
CAPITAL SHARE TRANSACTIONS:
The Portfolio is authorized to issue an unlimited number of shares
with no par value. No capital transactions occurred during the year.
3
MANAGEMENT OF THE TRUST
The trustees and officers of the Trust and their principal occupations during
the past five years are as follows:
RICHARD F. CURCIO PRESIDENT, TRUSTEE, CHAIRMAN OF THE BOARD
Founded Integrity Investments, Inc. (a broker/dealer) and Integrity Management &
Research, Inc.(an investment adviser) in 1992, and is currently President and
Director of each. Senior Vice President/Regional Manager for Fidelity
Institutional Services Company from 1987 to 1992. Associated with Fidelity
Distributors from 1979 to 1992.
JOHN S. CULBERTSON TRUSTEE
Retired. Trust Consultant with Fidelity Investments Institutional Services Co.
from 1990 to 1993.
RUFUS C. CUSHMAN JR. TRUSTEE
Retired. Money Manager with Fidelity Management & Research Corp. From 1968
through 1994.
H. WILLIS DAY TRUSTEE
Retired. Former Senior Vice President of Southeast Bank, FLA, N.A.
ROGER F. DUMAS TRUSTEE
Private investor since 1987.
KENNETH J. PHELPS TRUSTEE
President, Principal and Director of Reliance Trust Company, Atlanta, GA since
1992. Chairman, Chief Executive Officer and Director, C&S/Sovran Trust Company,
Inc. from 1987 to 1992.
DENIS R. CURCIO VICE PRESIDENT, SECRETARY AND TREASURER
Mr. Curcio joined Integrity Investments, Inc. the distributor of The Valiant
Fund in June of 1998 after graduating from Jacksonville University with a BS in
Finance. Aged 28, Denis is responsible for oversight and administration of The
Valiant Fund.
4
BRENDEN R. CURCIO VICE PRESIDENT
Mr. Curcio joined Integrity Investments, Inc., the distributor of The Valiant
Fund in June of 1994 after graduating from Stetson University with a BBA in
Finance. Aged 33, Brenden is responsible for institutional sales of The Valiant
Fund in the Northeast and Midwest.
PROXY VOTING POLICIES AND PROCEDURES
You may obtain a description of the Trusts' proxy voting policies and
procedures, without charge, upon request, by calling Integrity Investments, Inc.
at 1-800-828-2176 or by going to the Securities and Exchange Commission's
website at www.sec.gov.
Information regarding how the Trust voted proxies relating to portfolio
securities, if applicable, during the most recent 12-month period ended June 30,
is also available, without charge and upon request, by calling Integrity
Investments, Inc. at 1-800-828-2176 or accessing the Trusts' Form N-PX on the
Securities and Exchange Commission's website at www.sec.gov.
QUARTERLY PORTFOLIOS
The Trust files its complete schedule of portfolio holdings with the Commission
for the first and third quarters of each fiscal year on Form N-Q. The Trust's
Forms N-Q are available on the Commission's website at www.sec.gov. The Trust's
Forms N-Q may also be reviewed and copied at the Commission's Public Reference
Room in Washington, DC; information on the operation of the Public Reference
Room may be obtained by calling (800)-SEC-0330.
5
ITEM 2. CODE OF ETHICS.
Not applicable with semi annual filing.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable with semi annual filing.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable with semi annual filing.
ITEM 5: AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable with semi annual filing.
ITEM 6. SCHEDULE OF INVESTMENTS.
The Schedule of Investments is included as a part of the report to shareholders
filed under Item 1 of this Form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASE OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
None.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
None.
ITEM 11. CONTROLS AND PROCEDURES.
a) Based on their evaluation on May 3, 2005, the President (principal
executive officer) and the Treasurer (principal financial officer) of the
Valiant Fund (the "Fund") believe that there were no significant
deficiencies in the design or operation of the internal controls of the
Fund or Integrity Investments Inc. ("II"), the investment adviser, and
The Bank of New York ("BNY"), administrator of the Fund, including
disclosure controls and procedures (as defined in Rule 30a-2(c) under the
Investment Company Act of 1940) that adversely affected the ability of
the Fund, or II, or BNY, on behalf of the Fund, to record, process,
summarize, and report the subject matter contained in this Report, and
the President and Treasurer of the Fund have identified no material
weaknesses in such internal controls on behalf of the Fund. There was no
fraud, whether or not material, involving officers or employees of II, or
BNY, or the Fund who have a significant role in the Fund's internal
controls, including disclosure controls and procedures (as defined in
Rule 30a-2(c) under the Investment Company Act of 1940) that has come to
the attention of the Adviser or the officers of the Fund, including its
President and Treasurer.
b) There were no significant changes in the Fund and the II's internal
controls, including disclosure controls and procedures (as defined in
Rule 30a-2(c) under the Investment Company Act of 1940) that apply to the
Fund or in other factors with respect to the Fund that could have
significantly affected the Fund's or the II's internal controls during
the period covered by this Form N-CSR, and no corrective actions with
regard to significant deficiencies or material weaknesses were taken by
the Fund or the RI during such period.
ITEM 11. EXHIBITS.
(a)(1) Not applicable with semi annual filing.
(a)(2) Certification of principal executive officer and principal financial
officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
(b) Certification of principal executive officer and principal financial
officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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) The Valiant Fund
By (Signature and Title) /s/ Richard F. Curcio
---------------------
Richard F. Curcio, Chairman of the Board and President
Date May 5, 2005
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) /s/ Richard F. Curcio
---------------------
Richard F. Curcio, Chairman of the Board and President
Date May 5, 2005
By (Signature and Title) /s/ Denis R. Curcio
-------------------
Denis R. Curcio, Treasurer
Date May 5, 2005