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 811-07705
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Phoenix Asset Trust
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(Exact name of registrant as specified in charter)
101 Munson Street
Greenfield, MA 01301-9668
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(Address of principal executive offices) (Zip code)
Kevin J. Carr, Esq.
Vice President, Chief Legal Officer, John H. Beers, Esq.
Counsel and Secretary for Registrant Vice President and Counsel
Phoenix Life Insurance Company Phoenix Life Insurance Company
One American Row One American Row
Hartford, CT 06103-2899 Hartford, CT 06130-2899
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(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 243-1574
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Date of fiscal year end: December 31
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Date of reporting period: June 30, 2006
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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, 100 F Street, NE,
Washington, DC 20549. 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 Report to Shareholders is attached herewith.
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JUNE 30, 2006
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SEMIANNUAL REPORT
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o PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
o PHOENIX RISING DIVIDENDS FUND
o PHOENIX SMALL-MID CAP FUND
TRUST NAME: PHOENIX ASSET TRUST WOULDN'T YOU RATHER
HAVE THIS DOCUMENT
? E-MAILED TO YOU?
Eligible shareholers can sign up for
[LOGO] PHOENIXFUNDS(SM) E-Delivery at PhoenixFunds.com
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Mutual funds are not insured by the FDIC; are not deposits or other
obligations of a bank and are not guaranteed by a bank; and are
subject to investment risks, including possible loss of the
principal invested.
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This report is not authorized for distribution to prospective investors in the
Phoenix Asset Trust unless preceded or accompanied by an effective Prospectus
which includes information concerning the sales charge, each Fund's record and
other pertinent information.
A MESSAGE FROM THE PRESIDENT
DEAR PHOENIXFUNDS SHAREHOLDER:
This semiannual report addresses the performance of your Phoenix mutual
fund for the six months ended June 30, 2006. It provides detailed information
about your fund's performance, portfolio holdings and transactions for the
period.
At Phoenix, our focus is on investment performance and serving the best
interests of our shareholders. We believe that mutual funds are among the most
effective vehicles for individual investors to gain access to a variety of
financial markets and for building diversified portfolios.
I am especially proud of how we have expanded our fund family over the
last year to offer access to even more money managers. Today, the PhoenixFunds
draw from the vast expertise of 16 different management teams--six Phoenix
affiliates and 10 outside subadvisers chosen for their complementary investment
capabilities.
These fund teams operate independently, conducting their research,
identifying opportunities in the markets they know best, and applying their
disciplined strategies to the portfolios they manage. We are confident in their
ability to navigate their funds through whatever market and economic changes lie
ahead.
When it comes to financial decisions, we recommend working with an
experienced financial advisor. If you haven't reviewed or rebalanced your
portfolio lately, this may be a good time to meet with your advisor and make
sure that your investments are still aligned with your financial goals.
Thank you for choosing PhoenixFunds to be part of your financial plan.
Sincerely yours,
/s/ Daniel T. Geraci
Daniel T. Geraci
President, PhoenixFunds
JULY 2006
1
TABLE OF CONTENTS
Glossary ..................................................................... 3
Phoenix CA Intermediate Tax-Free Bond Fund ................................... 4
Phoenix Rising Dividends Fund ................................................11
Phoenix Small-Mid Cap Fund ...................................................18
Notes to Financial Statements ................................................25
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PROXY VOTING PROCEDURES (FORM N-PX)
The Adviser votes proxies relating to portfolio securities in accordance with
procedures that have been approved by the Trust's Board of Trustees. You may
obtain a description of these procedures, along with information regarding how
the Funds voted proxies during the most recent 12-month period ended June 30,
2005, free of charge, by calling toll-free 1-800-243-1574. This information is
also available through the Securities and Exchange Commission's website at
http://www.sec.gov.
FORM N-Q INFORMATION
The Trust files a complete schedule of portfolio holdings with the Securities
and Exchange Commission (the "SEC") for the first and third quarters of each
fiscal year on Form N-Q. Form N-Q is available on the SEC's website at
http://www.sec.gov. Form N-Q may be reviewed and copied at the SEC's Public
Reference Room. Information on the operation of the SEC's Public Reference Room
can be obtained by calling toll-free 1-800-SEC-0330.
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2
GLOSSARY
ADR (AMERICAN DEPOSITARY RECEIPT)
Represents shares of foreign companies traded in U.S. dollars on U.S. exchanges
that are held by a bank or a trust. Foreign companies use ADRs in order to make
it easier for Americans to buy their shares.
AMBAC
American Municipal Bond Assurance Corporation
FGIC
Financial Guaranty Insurance Company
FNMA OR "FANNIE MAE"
Federal National Mortgage Association
FSA
Financial Security Assurance, Inc.
GNMA OR "GINNIE MAE"
Government National Mortgage Association
MBIA
Municipal Bond Insurance Association
SPONSORED ADR
An ADR which is issued with the cooperation of the company whose stock will
underlie the ADR. These shares carry all the rights of the common share such as
voting rights. ADRs must be sponsored to be able to trade on the NYSE.
XLCA
XL Capital Assurance
3
PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
ABOUT YOUR FUND'S EXPENSES (UNAUDITED)
We believe it is important for you to understand the impact of costs on
your investment. All mutual funds have operating expenses. As a shareholder of
the CA Intermediate Tax-Free Bond Fund, you incur ongoing costs, including
investment advisory fees and other expenses. Class X shares are sold without a
sales charge and do not incur distribution and service fees. 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. This example is based on an investment of $1,000 invested at the
beginning of the period and held for the entire six-month period.
ACTUAL EXPENSES
The first line of the accompanying table 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 entitled "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the accompanying table provides information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed rate of return of 5% per year before expenses,
which is not your Fund's actual return. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or
expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in your Fund and other funds. To do so, compare these
5% hypothetical examples with the 5% hypothetical examples that appear in the
shareholder reports of the other funds.
Please note that the expenses shown in the accompanying table are meant to
highlight your ongoing costs only and do not reflect any transactional costs.
Therefore, the second line of the accompanying table is useful in comparing
ongoing costs only, and will not help you determine the relative total costs of
owning different funds. If you have incurred transactional costs, your costs
could have been higher. The calculations assume no shares were bought or sold
during the period. Your actual costs may have been higher or lower, depending on
the amount of your investment and the timing of any purchases or redemptions.
CA Intermediate Beginning Ending Expenses Paid
Tax-Free Bond Fund Account Value Account Value During
Class X December 31, 2005 June 30, 2006 Period*
- ------------------------ ----------------- ------------- --------------
Actual $ 1,000.00 $ 999.20 $ 3.72
Hypothetical (5% return
before expenses) 1,000.00 1,021.03 3.77
* EXPENSES ARE EQUAL TO THE FUND'S CLASS X ANNUALIZED EXPENSE RATIO OF 0.75%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
YOU CAN FIND MORE INFORMATION ABOUT THE FUND'S EXPENSES IN THE FINANCIAL
STATEMENTS SECTION THAT FOLLOWS. FOR ADDITIONAL INFORMATION ON OPERATING
EXPENSES AND OTHER SHAREHOLDER COSTS REFER TO THE PROSPECTUS.
4
PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
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SECTOR WEIGHTINGS (UNAUDITED) 6/30/06
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As a percentage of total investments
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Water & Sewer Revenue 22%
General Obligation 17
General Revenue 16
Power Revenue 11
Pre-Refunded 8
Municipal Utility District Revenue 7
Development Revenue 6
Other 13
SCHEDULE OF INVESTMENTS
JUNE 30, 2006
(UNAUDITED)
PAR
VALUE
(000) VALUE
--------- ------------
MUNICIPAL BONDS(d)--98.6%
DEVELOPMENT REVENUE--5.4%
Los Angeles County Public Works Financing
Authority Series A 5.50%, 10/1/18
(FSA Insured) ...................................... $ 450 $ 480,708
Menlo Park Community Development Agency
Las Pulgas Community Development Project
5.375%, 6/1/16 ..................................... 250 255,043
Ontario Redevelopment Financing Authority
Project No. 1 6.90%, 8/1/10 (MBIA Insured) ......... 70 77,941
Ontario Redevelopment Financing Authority Project
No. 1 Center City & Cimarron 5.25%, 8/1/13
(MBIA Insured) ..................................... 500 532,970
Riverside County Redevelopment Agency
Jurupa Valley Project 5.25%, 10/1/17
(AMBAC Insured) .................................... 250 265,897
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1,612,559
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FACILITIES REVENUE--1.7%
California State Public Works Board Series C
5.25%, 11/1/20 ..................................... 500 519,930
GENERAL OBLIGATION--16.4%
Brea Olinda Unified School District Series A 6%,
8/1/15 (FGIC Insured) .............................. 150 170,306
California State 6.25%, 4/1/08 ..................... 825 857,885
California State 5.50%, 4/1/10 (MBIA Insured) ...... 200 211,084
PAR
VALUE
(000) VALUE
--------- ------------
GENERAL OBLIGATION--CONTINUED
California State Unrefunded Balance 2001
5.25%, 6/1/16 ...................................... $ 80 $ 81,255
Desert Community College District 5%,
8/1/18 (MBIA Insured) .............................. 990 1,040,044
Grossmont-Cuyamaca Community College
Series A 5%, 8/1/19 (MBIA Insured) ................. 250 259,483
Metropolitan Water District Southern California
Series A 5.25%, 3/1/11 (Unrefunded Balance) ........ 180 186,089
San Diego County Certificates of Participation
5.25%, 11/1/15 (AMBAC Insured) ..................... 960 1,017,408
Santa Ana Unified School District 5.70%,
8/1/22 (FGIC Insured) .............................. 400 429,164
Wiseburn School District Series A 5%,
8/1/17 (MBIA Insured) .............................. 580 611,546
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4,864,264
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GENERAL REVENUE--15.5%
California State Economic Recovery
Series C-5 3.88%, 7/1/23 (State Guaranteed)(c) ..... 1,000 1,000,000
California State Public Works Board Health
Services 5%, 11/1/17 (XLCA Insured) ................ 460 480,171
Commonwealth of Puerto Rico Public
Finance Corp. Series A 5.25%, 8/1/30
(AMBAC Insured)(c) ................................. 500 528,865
San Jose Financing Authority Convention Center
Project Series F 5%, 9/1/15 (MBIA Insured) ......... 1,000 1,044,200
See Notes to Financial Statements 5
PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
PAR
VALUE
(000) VALUE
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GENERAL REVENUE--CONTINUED
Santa Clara County Finance Authority VMC
Facility Project Series A 7.75%, 11/15/11
(AMBAC Insured) .................................... $ 400 $ 471,040
South Coast Air Quality Management Corp. 6%,
8/1/11 (AMBAC Insured) ............................. 1,000 1,083,290
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4,607,566
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HIGHER EDUCATION REVENUE--1.8%
University of California Series A 5%, 5/15/10
(AMBAC Insured) .................................... 500 521,140
MEDICAL REVENUE--1.2%
California Health Facilities Financing Authority
Series A 5%, 11/15/14 .............................. 250 258,375
San Joaquin County Certificates of Participation
General Hospital Project 5.25%, 9/1/12
(MBIA Insured) ..................................... 100 104,849
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363,224
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MUNICIPAL UTILITY DISTRICT REVENUE--7.3%
Los Angeles Water and Power Series A-A2 5%,
7/1/19 ............................................. 760 789,017
Sacramento Municipal Utility District Series O
5.25%, 8/15/10 (MBIA Insured) ...................... 500 527,120
Sacramento Municipal Utility District Series O
5.25%, 8/15/15 (MBIA Insured) ...................... 310 327,877
Sacramento Municipal Utility District Series P
5.25%, 8/15/17 (FSA Insured) ....................... 500 526,945
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2,170,959
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POWER REVENUE--11.3%
California State Department of Water Resource
Power Supply Series A 5.25%, 5/1/09
(MBIA Insured) ..................................... 1,000 1,036,200
City of Pasadena 5%, 6/1/17 (MBIA Insured) ......... 300 310,518
Los Angeles Department of Water & Power
Series A-A-3 5.25%, 7/1/18 ......................... 300 300,000
Northern California Power Agency Public Power
Hydroelectric Project No. 1 Series A 5%, 7/1/15
(MBIA Insured) ..................................... 1,000 1,031,250
Southern California Public Power Authority
Transmission Project Series B 5%, 7/1/12
(FSA Insured) ...................................... 635 671,970
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3,349,938
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PAR
VALUE
(000) VALUE
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PRE-REFUNDED--8.3%
California Educational Facilities Authority Chapman
University 5.375%, 10/1/16 Pre-refunded
10/1/06 @102 ....................................... $ 250 $ 255,887
Contra Costa County Home Mortgage 7.50%,
5/1/14 (GNMA Collateralized)(b) .................... 500 604,515
Cypress Residential Mortgage Series B 7.25%,
1/1/12 (Private Mortgage Insurance)(b) ............. 200 232,482
Duarte Redevelopment Agency Single Family
Mortgage Series A 6.875%, 11/1/11
(FNMA Collateralized)(b) ........................... 300 342,480
Modesto Wastewater Treatment Facilities 6%,
11/1/12 (MBIA Insured) ............................. 735 820,231
Stockton Housing Authority O'Connor Woods
Project Series A 5.60%, 3/20/28 Pre-refunded
9/20/17 @ 100 (GNMA Collateralized) ................ 200 200,776
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2,456,371
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TRANSPORTATION REVENUE--5.1%
Alameda Corridor Transportation Authority
Series A 5.125%, 10/1/16 (MBIA Insured) ............ 150 156,804
Alameda Corridor Transportation Authority
Series A 5.125%, 10/1/17 (MBIA Insured) ............ 125 130,438
Port of Oakland Series I 5.60%, 11/1/19
(MBIA Insured) ..................................... 1,000 1,041,920
San Francisco Bay Area Rapid Transit Financing
Authority 5.25%, 7/1/17 ............................ 180 185,848
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1,515,010
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VETERAN REVENUE--3.1%
State of California Veterans Bonds Series 5.15%,
12/1/14 ............................................ 895 926,039
WATER & SEWER REVENUE--21.5%
California State Department of Water Resources
Series T 5.125%, 12/1/12 ........................... 250 259,520
California State Department of Water Resources
Series W 5.50%, 12/1/13 (FSA-CR Insured) ........... 1,000 1,094,650
East Bay Municipal Utility District Water System
5.25%, 6/1/18 (MBIA Insured) ....................... 1,035 1,091,097
El Dorado Irrigation District Certificates of
Participation Series A 5.25%, 3/1/16
(FGIC Insured) ..................................... 365 387,893
Metropolitan Water District of Southern California
Series B 5%, 7/1/13 ................................ 500 529,305
6 See Notes to Financial Statements
PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
PAR
VALUE
(000) VALUE
--------- ------------
WATER & SEWER REVENUE--CONTINUED
Modesto Wastewater Series A 5%, 11/1/19
(FSA Insured) ...................................... $ 245 $ 256,696
Mountain View Shoreline Regional Park
Community Series A 5.50%, 8/1/21
(MBIA Insured) ..................................... 1,000 1,021,080
Redlands Financing Authority Series A 5%, 9/1/17
(FSA Insured) ...................................... 1,000 1,045,150
Sweetwater Water Authority 5.25%, 4/1/10
(AMBAC Insured) .................................... 165 169,108
Westlands Water District Certificates of
Participation 5.25%, 9/1/14 (MBIA Insured) ......... 500 535,985
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6,390,484
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TOTAL MUNICIPAL BONDS
(IDENTIFIED COST $29,531,101) 29,297,484
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TOTAL INVESTMENTS--98.6%
(IDENTIFIED COST $29,531,101) 29,297,484(a)
Other assets and liabilities, net--1.4% 413,142
------------
NET ASSETS--100.0% $ 29,710,626
============
(a) Federal Income Tax Information: Net unrealized depreciation of investment
securities is comprised of gross appreciation of $286,557 and gross
depreciation of $520,174 for federal income tax purposes. At June 30,
2006, the aggregate cost of securities for federal income tax purposes was
$29,531,101.
(b) Escrowed to maturity.
(c) Variable or step coupon security; interest rate shown reflects the rate
currently in effect.
(d) At June 30, 2006, the concentration of the Fund's investments by state or
territory determined as a percentage of net assets is as follows:
California 97%. At June 30, 2006, 80% of the securities in the portfolio
are backed by insurance of financial institutions and financial guaranty
assurance agencies. Insurers with a concentration greater than 10% of net
assets are as follows: MBIA 40%, FSA 14%, and AMBAC 14%.
See Notes to Financial Statements 7
PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2006
(UNAUDITED)
ASSETS
Investment securities at value
(Identified cost $29,531,101) $ 29,297,484
Cash 85,832
Receivables
Interest 412,271
Trustee retainer 4,890
Prepaid expenses 6,501
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Total assets 29,806,978
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LIABILITIES
Payables
Fund shares repurchased 176
Dividend distributions 54,932
Professional fee 16,454
Investment advisory fee 14,291
Financial agent fee 6,192
Transfer agent fee 2,061
Other accrued expenses 2,246
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Total liabilities 96,352
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NET ASSETS $ 29,710,626
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest $ 29,956,953
Undistributed net investment income 80
Accumulated net realized loss (12,790)
Net unrealized depreciation (233,617)
------------
NET ASSETS $ 29,710,626
============
Shares of beneficial interest outstanding,
No par value, unlimited authorization
(Net Assets $29,710,626) 2,872,539
Net asset value and offering price per share $10.34
STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2006
(UNAUDITED)
INVESTMENT INCOME
Interest $ 719,291
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Total investment income 719,291
------------
EXPENSES
Investment advisory fee 85,227
Financial agent fee 26,937
Transfer agent 7,527
Professional 15,314
Trustees 9,519
Registration 9,150
Printing 6,061
Custodian 3,051
Miscellaneous 6,828
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Total expenses 169,614
Less expenses reimbursed by investment adviser (41,058)
Custodian fees paid indirectly (716)
------------
Net expenses 127,840
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NET INVESTMENT INCOME (LOSS) 591,451
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NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on investments (12,332)
Net change in unrealized appreciation (depreciation) on
investments (572,829)
------------
NET GAIN (LOSS) ON INVESTMENTS (585,161)
------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS $ 6,290
============
8 See Notes to Financial Statements
PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months
Ended Year Ended
June 30, 2006 December 31,
(Unaudited) 2005
------------- --------------
FROM OPERATIONS
Net investment income (loss) $ 591,451 $ 1,282,877
Net realized gain (loss) (12,332) 69,727
Net change in unrealized appreciation (depreciation) (572,829) (865,137)
------------- --------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 6,290 487,467
------------- --------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income (597,592) (1,281,172)
Net realized short-term gains -- (50)
Net realized long-term gains (25,681) (44,454)
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DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (623,273) (1,325,676)
------------- --------------
FROM SHARE TRANSACTIONS
Proceeds from sales of shares (259,091 and 300,844 shares, respectively) 2,715,751 3,212,011
Net asset value of shares issued from reinvestment of distributions
(24,613 and 56,283 shares, respectively) 257,290 598,864
Cost of shares repurchased (819,465 and 502,660 shares, respectively) (8,562,100) (5,341,011)
------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (5,589,059) (1,530,136)
------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS (6,206,042) (2,368,345)
NET ASSETS
Beginning of period 35,916,668 38,285,013
------------- --------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF
$80 AND $6,221, RESPECTIVELY) $ 29,710,626 $ 35,916,668
============= ==============
See Notes to Financial Statements 9
PHOENIX CA INTERMEDIATE TAX-FREE BOND FUND
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
CLASS X
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SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 2006 --------------------------------------------------------------
(UNAUDITED) 2005 2004 2003 2002 2001
Net asset value, beginning of period $ 10.54 $ 10.77 $ 10.96 $ 10.93 $ 10.74 $ 10.83
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.18(1) 0.36(1) 0.37 0.41 0.46 0.47
Net realized and unrealized gain (loss) (0.19) (0.22) (0.04) 0.04 0.24 (0.02)
-------- -------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS (0.01) 0.14 0.33 0.45 0.70 0.45
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Dividends from net investment income (0.18) (0.36) (0.37) (0.41) (0.46) (0.47)
Distributions from net realized gains (0.01) (0.01) (0.15) (0.01) (0.05) (0.07)
-------- -------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.19) (0.37) (0.52) (0.42) (0.51) (0.54)
-------- -------- -------- -------- -------- --------
Change in net asset value (0.20) (0.23) (0.19) 0.03 0.19 (0.09)
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 10.34 $ 10.54 $ 10.77 $ 10.96 $ 10.93 $ 10.74
======== ======== ======== ======== ======== ========
Total return (0.08)%(2) 1.33% 3.04% 4.25% 6.60% 4.26%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 29,711 $ 35,917 $ 38,285 $ 39,368 $ 33,307 $ 34,422
RATIO OF EXPENSES TO AVERAGE NET ASSETS:
Net operating expenses 0.75%(3) 0.75% 0.75% 0.75% 0.75% 0.75%
Gross operating expenses 0.99%(3) 1.03% 0.98% 1.03% 0.98% 0.85%
Net investment income (loss) 3.47%(3) 3.37% 3.39% 3.72% 4.18% 4.38%
Portfolio turnover 14%(2) 36% 62% 33% 21% 61%
(1) Computed using average shares outstanding.
(2) Not annualized.
(3) Annualized.
10 See Notes to Financial Statements
PHOENIX RISING DIVIDENDS FUND
ABOUT YOUR FUND'S EXPENSES (UNAUDITED)
We believe it is important for you to understand the impact of costs on
your investment. All mutual funds have operating expenses. As a shareholder of
the Rising Dividends Fund, you incur two types of costs: (1) transaction costs,
including sales charges on purchases of Class A shares and contingent deferred
sales charges on Class B and Class C shares; and (2) ongoing costs, including
investment advisory fees; distribution and service fees; and other expenses.
Class X shares are sold without a sales charge and do not incur distribution and
service fees. These examples are 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. These examples are based on an
investment of $1,000 invested at the beginning of the period and held for the
entire six-month period.
ACTUAL EXPENSES
The first line of the accompanying 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 entitled "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the accompanying tables provides information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed rate of return of 5% per year before expenses,
which is not your Fund's actual return. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or
expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in your Fund and other funds. To do so, compare these
5% hypothetical examples with the 5% hypothetical examples that appear in the
shareholder reports of the other funds.
Please note that the expenses shown in the accompanying tables are meant
to highlight your ongoing costs only and do not reflect any transactional costs,
such as sales charges or contingent deferred sales charges. Therefore, the
second line of the accompanying tables 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 could have been higher. The calculations assume no shares were bought or
sold during the period. Your actual costs may have been higher or lower,
depending on the amount of your investment and the timing of any purchases or
redemptions.
Beginning Ending Expenses Paid
Rising Dividends Fund Account Value Account Value During
Class X December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 999.00 $ 5.40
Hypothetical (5% return
before expenses) 1,000.00 1,019.33 5.47
* EXPENSES ARE EQUAL TO THE FUND'S CLASS X ANNUALIZED EXPENSE RATIO OF 1.09%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Rising Dividends Fund Account Value Account Value During
Class A December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 997.70 $ 6.64
Hypothetical (5% return
before expenses) 1,000.00 1,018.07 6.73
* EXPENSES ARE EQUAL TO THE FUND'S CLASS A ANNUALIZED EXPENSE RATIO OF 1.34%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Rising Dividends Fund Account Value Account Value During
Class B December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 994.30 $ 10.33
Hypothetical (5% return
before expenses) 1,000.00 1,014.31 10.49
* EXPENSES ARE EQUAL TO THE FUND'S CLASS B ANNUALIZED EXPENSE RATIO OF 2.09%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Rising Dividends Fund Account Value Account Value During
Class C December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 994.30 $ 10.33
Hypothetical (5% return
before expenses) 1,000.00 1,014.31 10.49
* EXPENSES ARE EQUAL TO THE FUND'S CLASS C ANNUALIZED EXPENSE RATIO OF 2.09%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
YOU CAN FIND MORE INFORMATION ABOUT THE FUND'S EXPENSES IN THE FINANCIAL
STATEMENTS SECTION THAT FOLLOWS. FOR ADDITIONAL INFORMATION ON OPERATING
EXPENSES AND OTHER SHAREHOLDER COSTS REFER TO THE PROSPECTUS.
11
PHOENIX RISING DIVIDENDS FUND
- --------------------------------------------------------------------------------
SECTOR WEIGHTINGS (UNAUDITED) 6/30/06
- --------------------------------------------------------------------------------
As a percentage of total investments
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Financials 21%
Information Technology 15
Consumer Staples 15
Industrials 11
Energy 11
Health Care 10
Consumer Discretionary 7
Other 10
SCHEDULE OF INVESTMENTS
JUNE 30, 2006
(UNAUDITED)
SHARES VALUE
--------- ------------
DOMESTIC COMMON STOCKS--99.4%
AIR FREIGHT & LOGISTICS--1.9%
United Parcel Service, Inc. Class B ................ 21,600 $ 1,778,328
ASSET MANAGEMENT & CUSTODY BANKS--1.4%
State Street Corp. ................................. 23,000 1,336,070
COMMUNICATIONS EQUIPMENT--2.0%
Qualcomm, Inc. ..................................... 46,800 1,875,276
COMPUTER HARDWARE--4.3%
Diebold, Inc.(c) ................................... 40,000 1,624,800
International Business Machines Corp. .............. 30,610 2,351,460
------------
3,976,260
------------
DATA PROCESSING & OUTSOURCED SERVICES--2.0%
Automatic Data Processing, Inc. .................... 41,730 1,892,456
DEPARTMENT STORES--1.5%
Nordstrom, Inc. .................................... 38,100 1,390,650
DIVERSIFIED BANKS--4.4%
U.S. Bancorp ....................................... 47,000 1,451,360
Wells Fargo & Co. .................................. 38,680 2,594,654
------------
4,046,014
------------
DIVERSIFIED COMMERCIAL & PROFESSIONAL SERVICES--1.8%
Cintas Corp. ....................................... 42,000 1,669,920
ELECTRIC UTILITIES--1.5%
Southern Co. (The) ................................. 42,200 1,352,510
SHARES VALUE
--------- ------------
FOOTWEAR--2.0%
Nike, Inc. Class B ................................. 22,800 $ 1,846,800
HEALTH CARE EQUIPMENT--3.3%
Biomet, Inc. ....................................... 41,600 1,301,664
Medtronic, Inc. .................................... 37,800 1,773,576
------------
3,075,240
------------
HOUSEHOLD PRODUCTS--3.1%
Procter & Gamble Co. (The) ......................... 52,000 2,891,200
HYPERMARKETS & SUPER CENTERS--5.2%
Costco Wholesale Corp. ............................. 33,900 1,936,707
Wal-Mart Stores, Inc. .............................. 61,100 2,943,187
------------
4,879,894
------------
INDUSTRIAL CONGLOMERATES--6.4%
3M Co. ............................................. 26,200 2,116,174
General Electric Co. ............................... 116,860 3,851,706
------------
5,967,880
------------
INDUSTRIAL MACHINERY--1.6%
Illinois Tool Works, Inc. .......................... 32,240 1,531,400
INTEGRATED OIL & GAS--10.1%
Chevron Corp. ...................................... 34,500 2,141,070
ConocoPhillips ..................................... 49,000 3,210,970
Exxon Mobil Corp. .................................. 66,240 4,063,824
------------
9,415,864
------------
INTEGRATED TELECOMMUNICATION SERVICES--3.0%
AT&T, Inc. ......................................... 100,300 2,797,367
12 See Notes to Financial Statements
PHOENIX RISING DIVIDENDS FUND
SHARES VALUE
--------- ------------
INVESTMENT BANKING & BROKERAGE--2.7%
Morgan Stanley ..................................... 39,600 $ 2,503,116
LIFE & HEALTH INSURANCE--3.4%
AFLAC, Inc. ........................................ 36,500 1,691,775
MetLife, Inc. ...................................... 28,500 1,459,485
------------
3,151,260
------------
MOVIES & ENTERTAINMENT--1.5%
Walt Disney Co. (The) .............................. 47,600 1,428,000
MULTI-LINE INSURANCE--2.7%
American International Group, Inc. ................. 42,200 2,491,910
OIL & GAS EXPLORATION & PRODUCTION--1.1%
Apache Corp. ....................................... 14,500 989,625
OTHER DIVERSIFIED FINANCIAL SERVICES--5.3%
Bank of America Corp. .............................. 51,800 2,491,580
Citigroup, Inc. .................................... 50,200 2,421,648
------------
4,913,228
------------
PERSONAL PRODUCTS--1.7%
Avon Products, Inc. ................................ 50,300 1,559,300
PHARMACEUTICALS--7.2%
Abbott Laboratories ................................ 33,200 1,447,852
Johnson & Johnson .................................. 63,870 3,827,090
Wyeth .............................................. 32,000 1,421,120
------------
6,696,062
------------
PUBLISHING & PRINTING--2.0%
Gannett Co., Inc. .................................. 32,900 1,840,097
REGIONAL BANKS--1.5%
Synovus Financial Corp. ............................ 52,600 1,408,628
SEMICONDUCTORS--5.3%
Intel Corp. ........................................ 140,500 2,662,475
Linear Technology Corp. ............................ 67,900 2,273,971
------------
4,936,446
------------
SOFT DRINKS--4.9%
Coca-Cola Co. (The) ................................ 56,360 2,424,607
PepsiCo, Inc. ...................................... 34,900 2,095,396
------------
4,520,003
------------
SHARES VALUE
--------- ------------
SPECIALTY CHEMICALS--2.8%
Sigma-Aldrich Corp.(c) ............................. 35,200 $ 2,556,928
SYSTEMS SOFTWARE--1.8%
Microsoft Corp. .................................... 72,480 1,688,784
- -----------------------------------------------------------------------------
TOTAL DOMESTIC COMMON STOCKS
(IDENTIFIED COST $87,697,196) 92,406,516
- -----------------------------------------------------------------------------
TOTAL LONG TERM INVESTMENTS--99.4%
(IDENTIFIED COST $87,697,196) 92,406,516
- -----------------------------------------------------------------------------
SHORT-TERM INVESTMENTS--3.2%
MONEY MARKET MUTUAL FUNDS--2.6%
State Street Navigator Prime Plus (5.06% seven
day effective yield)(b) ............................ 2,411,494 2,411,494
PAR
VALUE
(000)
---------
COMMERCIAL PAPER(d)--0.6%
UBS Americas 5.27%, 7/3/06 ......................... $ 555 554,837
- -----------------------------------------------------------------------------
TOTAL SHORT-TERM INVESTMENTS
(IDENTIFIED COST $2,966,331) 2,966,331
- -----------------------------------------------------------------------------
TOTAL INVESTMENTS--102.6%
(IDENTIFIED COST $90,663,527) 95,372,847(a)
Other assets and liabilities, net--(2.6)% (2,408,752)
------------
NET ASSETS--100.0% $ 92,964,095
============
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $7,255,533 and gross
depreciation of $3,260,672 for federal income tax purposes. At June 30,
2006, the aggregate cost of securities for federal income tax purposes was
$91,377,986.
(b) Represents security purchased with cash collateral received for securities
on loan.
(c) All or a portion of security is on loan.
(d) The rate shown is the discount rate.
See Notes to Financial Statements 13
PHOENIX RISING DIVIDENDS FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2006
(UNAUDITED)
ASSETS
Investment securities at value,
including $2,359,327 of securities on loan
(Identified cost $90,663,527) $ 95,372,847
Cash 2,121
Receivables
Dividends 108,654
Fund shares sold 82,947
Trustee retainer 2,351
Prepaid expenses 20,237
------------
Total assets 95,589,157
------------
LIABILITIES
Payables
Fund shares repurchased 102,114
Upon return of securities loaned 2,411,494
Investment advisory fee 58,322
Professional fee 15,804
Transfer agent fee 13,803
Financial agent fee 9,612
Distribution and service fees 5,583
Other accrued expenses 8,330
------------
Total liabilities 2,625,062
------------
NET ASSETS $ 92,964,095
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest $ 99,811,996
Undistributed net investment income 247,733
Accumulated net realized loss (11,804,954)
Net unrealized appreciation 4,709,320
------------
NET ASSETS $ 92,964,095
============
CLASS X
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $78,655,169) 5,091,197
Net asset value and offering price per share $15.45
CLASS A
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $10,109,260) 655,907
Net asset value per share $15.41
Offering price per share $15.41/(1-5.75%) $16.35
CLASS B
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $2,233,394) 146,366
Net asset value and offering price per share $15.26
CLASS C
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $1,966,272) 128,787
Net asset value and offering price per share $15.27
STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2006
(UNAUDITED)
INVESTMENT INCOME
Dividends $ 1,078,016
Interest 25,465
Security lending 1,402
------------
Total investment income 1,104,883
------------
EXPENSES
Investment advisory fee 370,455
Service fees, Class A 14,242
Distribution and service fees, Class B 12,608
Distribution and service fees, Class C 10,981
Financial agent fee 46,006
Transfer agent 32,320
Registration 26,041
Printing 17,694
Professional 14,866
Trustees 12,071
Custodian 6,410
Miscellaneous 11,669
------------
Total expenses 575,363
Custodian fees paid indirectly (28)
------------
Net expenses 575,335
------------
NET INVESTMENT INCOME (LOSS) 529,548
------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on investments 1,063,480
Net change in unrealized appreciation (depreciation)
on investments (1,629,672)
------------
NET GAIN (LOSS) ON INVESTMENTS (566,192)
------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS $ (36,644)
============
14 See Notes to Financial Statements
PHOENIX RISING DIVIDENDS FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months
Ended Year Ended
June 30, 2006 December 31,
(Unaudited) 2005
------------- --------------
FROM OPERATIONS
Net investment income (loss) $ 529,548 $ 1,250,576
Net realized gain (loss) 1,063,480 5,582,035
Net change in unrealized appreciation (depreciation) (1,629,672) (8,998,282)
------------- --------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS (36,644) (2,165,671)
------------- --------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net investment income, Class X (327,856) (1,324,154)
Net investment income, Class A (28,816) (424,144)
Net investment income, Class B (1,909) (9,192)
Net investment income, Class C (1,715) (8,278)
------------- --------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (360,296) (1,765,768)
------------- --------------
FROM SHARE TRANSACTIONS
CLASS X
Proceeds from sales of shares (86,627 and 436,950 shares, respectively) 1,357,400 6,804,544
Net asset value of shares issued from reinvestment of distributions
(12,683 and 48,431 shares, respectively) 193,542 759,875
Cost of shares repurchased (487,175 and 1,059,956 shares, respectively) (7,606,839) (16,369,469)
------------- --------------
Total (6,055,897) (8,805,050)
------------- --------------
CLASS A
Proceeds from sales of shares (48,181 and 552,328 shares, respectively) 753,693 8,601,133
Net asset value of shares issued from reinvestment of distributions
(1,831 and 26,708 shares, respectively) 27,886 416,489
Cost of shares repurchased (226,464 and 3,101,744 shares, respectively) (3,555,710) (48,397,862)
------------- --------------
Total (2,774,131) (39,380,240)
------------- --------------
CLASS B
Proceeds from sales of shares (3,362 and 22,646 shares, respectively) 52,143 349,846
Net asset value of shares issued from reinvestment of distributions
(111 and 382 shares, respectively) 1,679 5,949
Cost of shares repurchased (36,356 and 33,260 shares, respectively) (561,995) (513,247)
------------- --------------
Total (508,173) (157,452)
------------- --------------
CLASS C
Proceeds from sales of shares (5,843 and 30,780 shares, respectively) 91,313 475,661
Net asset value of shares issued from reinvestment of distributions
(109 and 473 shares, respectively) 1,639 7,366
Cost of shares repurchased (32,964 and 74,357 shares, respectively) (511,411) (1,141,833)
------------- --------------
Total (418,459) (658,806)
------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (9,756,660) (49,001,548)
------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS (10,153,600) (52,932,987)
NET ASSETS
Beginning of period 103,117,695 156,050,682
------------- --------------
END OF PERIOD (INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF
$247,733 AND $78,481, RESPECTIVELY) $ 92,964,095 $ 103,117,695
============= ==============
See Notes to Financial Statements 15
PHOENIX RISING DIVIDENDS FUND
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
CLASS X
------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED DECEMBER 31,
JUNE 30,2006 -------------------------------------------------------------
(UNAUDITED) 2005 2004 2003 2002 2001
Net asset value, beginning of period $ 15.53 $ 15.95 $ 15.40 $ 13.03 $ 15.81 $ 17.97
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.09(2) 0.16(2) 0.20(2) 0.07(2) 0.06 0.05
Net realized and unrealized gain (loss) (0.11) (0.35) 0.53 2.33 (2.78) (2.03)
--------- -------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS (0.02) (0.19) 0.73 2.40 (2.72) (1.98)
--------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Dividends from net investment income (0.06) (0.23) (0.18) (0.03) (0.06) (0.05)
Distributions from net realized gain -- -- -- -- -- (0.13)
--------- -------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.06) (0.23) (0.18) (0.03) (0.06) (0.18)
--------- -------- -------- -------- -------- --------
Change in net asset value (0.08) (0.42) 0.55 2.37 (2.78) (2.16)
--------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 15.45 $ 15.53 $ 15.95 $ 15.40 $ 13.03 $ 15.81
========= ======== ======== ======== ======== ========
Total return (0.10)%(3) (1.19)% 4.76% 18.45% (17.25)% (11.03)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 78,655 $ 85,075 $ 96,558 $ 82,361 $ 77,263 $104,770
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.09%(4) 1.04% 1.04% 1.19% 1.04% 0.95%
Net investment income (loss) 1.15%(4) 1.04% 1.25% 0.53% 0.42% 0.30%
Portfolio turnover 27%(3) 33% 22% 26% 26% 32%
CLASS A
-------------------------------------------------------------------------
SIX MONTHS FROM INCEPTION
ENDED YEAR ENDED DECEMBER 31, AUGUST 30, 2002
JUNE 30, 2006 ------------------------------------ TO DECEMBER 31,
(UNAUDITED) 2005 2004 2003 2002
Net asset value, beginning of period $ 15.49 $ 15.91 $ 15.35 $ 13.02 $ 13.53
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.07(2) 0.12(2) 0.17(2) 0.05(2) --(5)
Net realized and unrealized gain (loss) (0.11) (0.35) 0.53 2.31 (0.51)
--------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS (0.04) (0.23) 0.70 2.36 (0.51)
--------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Dividends from net investment income (0.04) (0.19) (0.14) (0.03) --
--------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.04) (0.19) (0.14) (0.03) --
--------- -------- -------- -------- --------
Change in net asset value (0.08) (0.42) 0.56 2.33 (0.51)
--------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 15.41 $ 15.49 $ 15.91 $ 15.35 $ 13.02
========= ======== ======== ======== ========
Total return(1) (0.23)%(3) (1.43)% 4.61% 18.06% (3.77)%(3)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 10,109 $ 12,894 $ 53,369 $ 28,988 $ 4,012
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.34%(4) 1.29% 1.28% 1.44% 1.29%(4)
Net investment income (loss) 0.88%(4) 0.76% 1.09% 0.36% 0.17%(4)
Portfolio turnover 27%(3) 33% 22% 26% 26%(3)
(1) Sales charges are not reflected in the total return calculation.
(2) Computed using average shares outstanding.
(3) Not annualized.
(4) Annualized.
(5) Amount is less than $0.01.
16 See Notes to Financial Statements
PHOENIX RISING DIVIDENDS FUND
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
CLASS B
-------------------------------------------------------------------------
SIX MONTHS FROM INCEPTION
ENDED YEAR ENDED DECEMBER 31, AUGUST 30, 2002
JUNE 30, 2006 ------------------------------------ TO DECEMBER 31,
(UNAUDITED) 2005 2004 2003 2002
Net asset value, beginning of period $ 15.36 $ 15.76 $ 15.20 $ 12.98 $ 13.53
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.01(4) 0.01(4) 0.06(4) (0.06)(4) (0.01)
Net realized and unrealized gain (0.10) (0.36) 0.52 2.30 (0.54)
--------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS (0.09) (0.35) 0.58 2.24 (0.55)
--------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Dividends from net investment income (0.01) (0.05) (0.02) (0.02) --
--------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.01) (0.05) (0.02) (0.02) --
--------- -------- -------- -------- --------
Change in net asset value (0.10) (0.40) 0.56 2.22 (0.55)
--------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 15.26 $ 15.36 $ 15.76 $ 15.20 $ 12.98
========= ======== ======== ======== ========
Total return(1) (0.57)%(2) (2.22)% 3.80% 17.29% (4.07)%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 2,233 $ 2,754 $ 2,987 $ 1,717 $ 336
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.09%(3) 2.05% 2.04% 2.19% 2.04%(3)
Net investment income (loss) 0.14%(3) 0.05% 0.36% (0.47)% (0.58)%(3)
Portfolio turnover 27%(2) 33% 22% 26% 26%(2)
CLASS C
-------------------------------------------------------------------------
SIX MONTHS FROM INCEPTION
ENDED YEAR ENDED DECEMBER 31, AUGUST 30, 2002
JUNE 30, 2006 ------------------------------------ TO DECEMBER 31,
(UNAUDITED) 2005 2004 2003 2002
Net asset value, beginning of period $ 15.37 $ 15.77 $ 15.20 $ 12.98 $ 13.53
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) 0.01(4) 0.01(4) 0.05(4) (0.06)(4) (0.01)
Net realized and unrealized gain (0.10) (0.36) 0.54 2.30 (0.54)
--------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS (0.09) (0.35) 0.59 2.24 (0.55)
--------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Dividends from net investment income (0.01) (0.05) (0.02) (0.02) --
--------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.01) (0.05) (0.02) (0.02) --
--------- -------- -------- -------- --------
Change in net asset value (0.10) (0.40) 0.57 2.22 (0.55)
--------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 15.27 $ 15.37 $ 15.77 $ 15.20 $ 12.98
========= ======== ======== ======== ========
Total return(1) (0.57)%(2) (2.22)% 3.85% 17.24% (4.07)%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 1,966 $ 2,395 $ 3,137 $ 1,952 $ 575
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.09%(3) 2.05% 2.04% 2.19% 2.04%(3)
Net investment income (loss) 0.14%(3) 0.05% 0.32% (0.47)% (0.58)%(3)
Portfolio turnover 27%(2) 33% 22% 26% 26%(2)
(1) Sales charges are not reflected in the total return calculation.
(2) Not annualized.
(3) Annualized.
(4) Computed using average shares outstanding.
See Notes to Financial Statements 17
PHOENIX SMALL-MID CAP FUND
ABOUT YOUR FUND'S EXPENSES (UNAUDITED)
We believe it is important for you to understand the impact of costs on
your investment. All mutual funds have operating expenses. As a shareholder of
the Small-Mid Cap Fund, you incur two types of costs: (1) transaction costs,
including sales charges on purchases of Class A shares and contingent deferred
sales charges on Class B and Class C shares; and (2) ongoing costs, including
investment advisory fees; distribution and service fees; and other expenses.
Class X shares are sold without a sales charge and do not incur distribution and
service fees. These examples are 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. These examples are based on an
investment of $1,000 invested at the beginning of the period and held for the
entire six-month period.
ACTUAL EXPENSES
The first line of the accompanying 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 entitled "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the accompanying tables provides information about
hypothetical account values and hypothetical expenses based on the Fund's actual
expense ratio and an assumed rate of return of 5% per year before expenses,
which is not your Fund's actual return. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or
expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in your Fund and other funds. To do so, compare these
5% hypothetical examples with the 5% hypothetical examples that appear in the
shareholder reports of the other funds.
Please note that the expenses shown in the accompanying tables are meant
to highlight your ongoing costs only and do not reflect any transactional costs,
such as sales charges or contingent deferred sales charges. Therefore, the
second line of the accompanying tables 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 could have been higher. The calculations assume no shares were bought or
sold during the period. Your actual costs may have been higher or lower,
depending on the amount of your investment and the timing of any purchases or
redemptions.
Beginning Ending Expenses Paid
Small Mid-Cap Fund Account Value Account Value During
Class X December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 1,033.40 $ 6.15
Hypothetical (5% return
before expenses) 1,000.00 1,018.68 6.12
* EXPENSES ARE EQUAL TO THE FUND'S CLASS X ANNUALIZED EXPENSE RATIO OF 1.22%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Small Mid-Cap Fund Account Value Account Value During
Class A December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 1,032.30 $ 7.41
Hypothetical (5% return
before expenses) 1,000.00 1,017.42 7.38
* EXPENSES ARE EQUAL TO THE FUND'S CLASS A ANNUALIZED EXPENSE RATIO OF 1.47%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Small Mid-Cap Fund Account Value Account Value During
Class B December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 1,028.70 $ 11.17
Hypothetical (5% return
before expenses) 1,000.00 1,013.65 11.15
* EXPENSES ARE EQUAL TO THE FUND'S CLASS B ANNUALIZED EXPENSE RATIO OF 2.22%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
Beginning Ending Expenses Paid
Small Mid-Cap Fund Account Value Account Value During
Class C December 31, 2005 June 30, 2006 Period*
- ----------------------- ----------------- ------------- -------------
Actual $ 1,000.00 $ 1,028.60 $ 11.17
Hypothetical (5% return
before expenses) 1,000.00 1,013.65 11.15
* EXPENSES ARE EQUAL TO THE FUND'S CLASS C ANNUALIZED EXPENSE RATIO OF 2.22%,
WHICH INCLUDES WAIVED FEES AND REIMBURSED EXPENSES, IF APPLICABLE, MULTIPLIED
BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY THE NUMBER OF DAYS
(181) EXPENSES WERE ACCRUED IN THE MOST RECENT FISCAL HALF-YEAR, THEN DIVIDED
BY 365 TO REFLECT THE ONE-HALF YEAR PERIOD.
YOU CAN FIND MORE INFORMATION ABOUT THE FUND'S EXPENSES IN THE FINANCIAL
STATEMENTS SECTION THAT FOLLOWS. FOR ADDITIONAL INFORMATION ON OPERATING
EXPENSES AND OTHER SHAREHOLDER COSTS REFER TO THE PROSPECTUS.
18
PHOENIX SMALL-MID CAP FUND
- --------------------------------------------------------------------------------
SECTOR WEIGHTINGS (UNAUDITED) 6/30/06
- --------------------------------------------------------------------------------
As a percentage of total investments
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Financials 19%
Information Technology 19
Industrials 16
Consumer Discretionary 12
Energy 6
Materials 6
Consumer Staples 3
Other 19
SCHEDULE OF INVESTMENTS
JUNE 30, 2006
(UNAUDITED)
SHARES VALUE
--------- ------------
DOMESTIC COMMON STOCKS--98.9%
ADVERTISING--3.5%
Catalina Marketing Corp.(d) ........................ 146,010 $ 4,155,445
AIR FREIGHT & LOGISTICS--5.0%
Pacer International, Inc.(d) ....................... 183,000 5,962,140
APPLICATION SOFTWARE--8.8%
Fair Isaac Corp.(d) ................................ 146,585 5,322,501
Jack Henry & Associates, Inc.(d) ................... 265,815 5,225,923
------------
10,548,424
------------
ASSET MANAGEMENT & CUSTODY BANKS--4.7%
Eaton Vance Corp.(d) ............................... 228,508 5,703,560
DIVERSIFIED COMMERCIAL & PROFESSIONAL SERVICES--5.4%
Cintas Corp.(d) .................................... 53,565 2,129,745
Copart, Inc.(b)(d) ................................. 176,500 4,334,840
------------
6,464,585
------------
ELECTRONIC EQUIPMENT MANUFACTURERS--3.8%
Mettler-Toledo International, Inc.(b) .............. 75,000 4,542,750
ENVIRONMENTAL & FACILITIES SERVICES--2.3%
Stericycle, Inc.(b)(d) ............................. 43,400 2,825,340
GENERAL MERCHANDISE STORES--2.3%
99 Cents Only Stores(b)(d) ......................... 260,000 2,719,600
HEALTH CARE SERVICES--2.1%
Pediatrix Medical Group, Inc.(b) ................... 55,000 2,491,500
HOMEFURNISHING RETAIL--4.6%
Rent-A-Center, Inc.(b)(d) .......................... 221,250 5,500,275
SHARES VALUE
--------- ------------
HOUSEHOLD PRODUCTS--3.0%
Church & Dwight Co., Inc. .......................... 98,000 $ 3,569,160
INDUSTRIAL CONGLOMERATES--2.3%
Teleflex, Inc.(d) .................................. 50,610 2,733,952
INDUSTRIAL MACHINERY--3.1%
Donaldson Co., Inc.(d) ............................. 110,200 3,732,474
INSURANCE BROKERS--2.3%
Brown & Brown, Inc.(d) ............................. 95,600 2,793,432
IT CONSULTING & OTHER SERVICES--3.3%
SRA International, Inc. Class A(b)(d) .............. 148,000 3,941,240
LIFE & HEALTH INSURANCE--3.8%
StanCorp Financial Group, Inc. ..................... 89,000 4,530,990
OFFICE ELECTRONICS--2.2%
Zebra Technologies Corp. Class A(b)(d) ............. 79,300 2,708,888
OFFICE SERVICES & SUPPLIES--1.5%
Mine Safety Appliances Co. ......................... 45,000 1,809,000
OIL & GAS EQUIPMENT & SERVICES--7.0%
Universal Compression Holdings, Inc.(b) ............ 134,000 8,437,980
PAPER PACKAGING--4.1%
Bemis Co., Inc.(d) ................................. 162,944 4,989,345
PROPERTY & CASUALTY INSURANCE--3.3%
Cincinnati Financial Corp.(d) ...................... 85,674 4,027,535
REGIONAL BANKS--5.0%
UCBH Holdings, Inc.(d) ............................. 365,000 6,037,100
See Notes to Financial Statements 19
PHOENIX SMALL-MID CAP FUND
SHARES VALUE
--------- ------------
REINSURANCE--4.0%
Reinsurance Group of America, Inc.(d) .............. 98,600 $ 4,846,190
SEMICONDUCTORS--4.7%
Microchip Technology, Inc. ......................... 168,000 5,636,400
SPECIALIZED CONSUMER SERVICES--4.4%
Regis Corp.(d) ..................................... 147,000 5,234,670
SPECIALTY CHEMICALS--2.4%
Valspar Corp. (The)(d) ............................. 109,040 2,879,746
- -----------------------------------------------------------------------------
TOTAL DOMESTIC COMMON STOCKS
(IDENTIFIED COST $93,623,207) 118,821,721
- -----------------------------------------------------------------------------
TOTAL LONG TERM INVESTMENTS--98.9%
(IDENTIFIED COST $93,623,207) 118,821,721
- -----------------------------------------------------------------------------
SHORT-TERM INVESTMENTS--20.6%
MONEY MARKET MUTUAL FUNDS--19.6%
State Street Navigator Prime Plus (5.06%
seven day effective yield)(c) ...................... 23,512,756 23,512,756
PAR
VALUE
(000)
---------
COMMERCIAL PAPER(e)--1.0%
UBS Americas 5.27%, 7/3/06 ......................... $ 1,202 1,201,648
- -----------------------------------------------------------------------------
TOTAL SHORT-TERM INVESTMENTS
(IDENTIFIED COST $24,714,404) 24,714,404
- -----------------------------------------------------------------------------
TOTAL INVESTMENTS--119.5%
(IDENTIFIED COST $118,337,611) 143,536,125(a)
Other assets and liabilities, net--(19.5)% (23,437,902)
------------
NET ASSETS--100.0% $120,098,223
============
(a) Federal Income Tax Information: Net unrealized appreciation of investment
securities is comprised of gross appreciation of $26,460,357 and gross
depreciation of $1,261,843 for federal income tax purposes. At June 30,
2006, the aggregate cost of securities for federal income tax purposes was
$118,337,611.
(b) Non-income producing.
(c) Represents security purchased with cash collateral received for securities
on loan.
(d) All or a portion of security is on loan.
(e) The rate shown is the discount rate.
20 See Notes to Financial Statements
PHOENIX SMALL-MID CAP FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2006
(UNAUDITED)
ASSETS
Investment securities at value,
including $22,932,871 of securities on loan
(Identified cost $118,337,611) $143,536,125
Cash 1,677
Receivables
Investment securities sold 1,914,573
Fund shares sold 227,594
Dividends 71,595
Trustee retainer 938
Prepaid expenses 21,347
------------
Total assets 145,773,849
------------
LIABILITIES
Payables
Investment securities purchased 1,777,280
Fund shares repurchased 214,988
Upon return of securities loaned 23,512,756
Investment advisory fee 84,221
Transfer agent fee 27,510
Distribution and service fees 20,235
Financial agent fee 11,532
Other accrued expenses 27,104
------------
Total liabilities 25,675,626
------------
NET ASSETS $120,098,223
============
NET ASSETS CONSIST OF:
Capital paid in on shares of beneficial interest $ 81,987,009
Accumulated net investment loss (360,808)
Accumulated net realized gain 13,273,508
Net unrealized appreciation 25,198,514
------------
NET ASSETS $120,098,223
============
CLASS X
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $69,047,614) 3,233,451
Net asset value and offering price per share $21.35
CLASS A
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $35,289,567) 1,667,990
Net asset value per share $21.16
Offering price per share $21.16/(1-5.75%) $22.45
CLASS B
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $3,256,982) 158,205
Net asset value and offering price per share $20.59
CLASS C
Shares of beneficial interest outstanding, no par value,
unlimited authorization (Net Assets $12,504,060) 606,718
Net asset value and offering price per share $20.61
STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2006
(UNAUDITED)
INVESTMENT INCOME
Dividends $ 530,150
Interest 28,302
Security lending 11,588
------------
Total investment income 570,040
------------
EXPENSES
Investment advisory fee 554,769
Service fees, Class A 46,489
Distribution and service fees, Class B 18,538
Distribution and service fees, Class C 68,324
Financial agent fee 55,990
Transfer agent 84,990
Registration 27,199
Printing 25,415
Professional 14,963
Trustees 13,491
Custodian 7,380
Miscellaneous 13,300
------------
Total expenses 930,848
------------
NET INVESTMENT INCOME (LOSS) (360,808)
------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Net realized gain (loss) on investments 14,118,660
Net change in unrealized appreciation (depreciation)
on investments (9,245,380)
------------
NET GAIN (LOSS) ON INVESTMENTS 4,873,280
------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS $ 4,512,472
============
See Notes to Financial Statements 21
PHOENIX SMALL-MID CAP FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months
Ended Year Ended
June 30, 2006 December 31,
(Unaudited) 2005
------------- --------------
FROM OPERATIONS
Net investment income (loss) $ (360,808) $ (653,688)
Net realized gain (loss) 14,118,660 18,147,704
Net change in unrealized appreciation (depreciation) (9,245,380) (15,195,581)
------------- --------------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 4,512,472 2,298,435
------------- --------------
FROM DISTRIBUTIONS TO SHAREHOLDERS
Net realized long-term gains, Class X (2,085,738) --
Net realized long-term gains, Class A (1,067,445) --
Net realized long-term gains, Class B (104,741) --
Net realized long-term gains, Class C (381,369) --
------------- --------------
DECREASE IN NET ASSETS FROM DISTRIBUTIONS TO SHAREHOLDERS (3,639,293) --
------------- --------------
FROM SHARE TRANSACTIONS
CLASS X
Proceeds from sales of shares (229,271 and 477,066 shares, respectively) 5,092,883 9,519,100
Net asset value of shares issued from reinvestment of distributions
(80,431 and 0 shares, respectively) 1,669,761 --
Cost of shares repurchased (750,150 and 1,287,633 shares, respectively) (16,643,532) (25,745,311)
------------- --------------
Total (9,880,888) (16,226,211)
------------- --------------
CLASS A
Proceeds from sales of shares (197,372 and 847,062 shares, respectively) 4,353,232 16,653,578
Net asset value of shares issued from reinvestment of distributions
(42,355 and 0 shares, respectively) 871,248 --
Cost of shares repurchased (376,811 and 2,626,953 shares, respectively) (8,279,148) (52,735,024)
------------- --------------
Total (3,054,668) (36,081,446)
------------- --------------
CLASS B
Proceeds from sales of shares (9,000 and 70,155 shares, respectively) 192,759 1,363,205
Net asset value of shares issued from reinvestment of distributions
(4,404 and 0 shares, respectively) 88,158 --
Cost of shares repurchased (46,781 and 95,771 shares, respectively) (999,459) (1,863,646)
------------- --------------
Total (718,542) (500,441)
------------- --------------
CLASS C
Proceeds from sales of shares (72,846 and 128,207 shares, respectively) 1,544,505 2,482,794
Net asset value of shares issued from reinvestment of distributions
(13,401 and 0 shares, respectively) 268,551 --
Cost of shares repurchased (161,028 and 325,669 shares, respectively) (3,455,299) (6,363,844)
------------- --------------
Total (1,642,243) (3,881,050)
------------- --------------
INCREASE (DECREASE) IN NET ASSETS FROM SHARE TRANSACTIONS (15,296,341) (56,689,148)
------------- --------------
NET INCREASE (DECREASE) IN NET ASSETS (14,423,162) (54,390,713)
NET ASSETS
Beginning of period 134,521,385 188,912,098
------------- --------------
END OF PERIOD (INCLUDING ACCUMULATED NET INVESTMENT LOSS AND
UNDISTRIBUTED NET INVESTMENT INCOME OF $(360,808) AND $0, RESPECTIVELY) $ 120,098,223 $ 134,521,385
============= ==============
22 See Notes to Financial Statements
PHOENIX SMALL-MID CAP FUND
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
CLASS X
-------------------------------------------------------------------------------
SIX MONTHS
ENDED
JUNE 30, 2006 YEAR ENDED DECEMBER 31,
(UNAUDITED) ----------------------------------------------------------------
2005 2004 2003 2002 2001
Net asset value, beginning of period $ 21.31 $ 20.70 $ 18.17 $ 14.34 $ 17.70 $ 17.19
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (0.04)(4) (0.04)(4) (0.06)(4) (0.05)(4) (0.06) (0.01)
Net realized and unrealized gain (loss) 0.73 0.65 2.59 3.88 (3.30) 1.15
-------- -------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS 0.69 0.61 2.53 3.83 (3.36) 1.14
-------- -------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Dividends from net investment income -- -- -- -- -- (0.01)
Distributions from net realized gains (0.65) -- -- -- -- (0.62)
-------- -------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.65) -- -- -- -- (0.63)
-------- -------- -------- -------- -------- --------
Change in net asset value 0.04 0.61 2.53 3.83 (3.36) 0.51
-------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 21.35 $ 21.31 $ 20.70 $ 18.17 $ 14.34 $ 17.70
======== ======== ======== ======== ======== ========
Total return 3.34%(2) 2.95% 13.92% 26.71% (18.98)% 6.40%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 69,048 $ 78,290 $ 92,838 $103,269 $ 98,112 $ 95,138
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.22%(3) 1.17% 1.15% 1.26% 1.22% 1.17%
Net investment income (loss) (0.35)%(3) (0.18)% (0.32)% (0.35)% (0.38)% (0.14)%
Portfolio turnover 17%(2) 22% 16% 17% 16% 17%
CLASS A
----------------------------------------------------------------------
FROM INCEPTION
SIX MONTHS AUGUST 30,
ENDED YEAR ENDED DECEMBER 31, 2002 TO
JUNE 30, 2006 ---------------------------------------- DECEMBER 31,
(UNAUDITED) 2005 2004 2003 2002
Net asset value, beginning of period $ 21.15 $ 20.59 $ 18.12 $ 14.34 $ 15.29
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (0.07)(4) (0.09)(4) (0.10)(4) (0.09)(4) (0.02)
Net realized and unrealized gain (loss) 0.73 0.65 2.57 3.87 (0.93)
-------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS 0.66 0.56 2.47 3.78 (0.95)
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Distributions from net realized gains (0.65) -- -- -- --
-------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.65) -- -- -- --
-------- -------- -------- -------- --------
Change in net asset value 0.01 0.56 2.47 3.78 (0.95)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 21.16 $ 21.15 $ 20.59 $ 18.12 $ 14.34
======== ======== ======== ======== ========
Total return(1) 3.23%(2) 2.72% 13.63% 26.36% (6.21)%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 35,290 $ 38,170 $ 73,825 $ 39,656 $ 2,086
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 1.47%(3) 1.42% 1.41% 1.51% 1.47%(3)
Net investment income (loss) (0.60)%(3) (0.45)% (0.55)% (0.60)% 0.62%(3)
Portfolio turnover 17%(2) 22% 16% 17% 16%(2)
(1) Sales charges are not reflected in the total return calculation.
(2) Not annualized.
(3) Annualized.
(4) Computed using average shares outstanding.
See Notes to Financial Statements 23
PHOENIX SMALL-MID CAP FUND
FINANCIAL HIGHLIGHTS
(SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT THE INDICATED PERIOD)
CLASS B
----------------------------------------------------------------------
FROM INCEPTION
SIX MONTHS AUGUST 30,
ENDED YEAR ENDED DECEMBER 31, 2002 TO
JUNE 30, 2006 ---------------------------------------- DECEMBER 31,
(UNAUDITED) 2005 2004 2003 2002
Net asset value, beginning of period $ 20.67 $ 20.27 $ 17.94 $ 14.30 $ 15.29
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (0.14)(4) (0.23)(4) (0.24)(4) (0.20)(4) (0.02)
Net realized and unrealized gain (loss) 0.71 0.63 2.57 3.84 (0.97)
-------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS 0.57 0.40 2.33 3.64 (0.99)
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Distributions from net realized gains (0.65) -- -- -- --
-------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.65) -- -- -- --
-------- -------- -------- -------- --------
Change in net asset value (0.08) 0.40 2.33 3.64 (0.99)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 20.59 $ 20.67 $ 20.27 $ 17.94 $ 14.30
======== ======== ======== ======== ========
Total return(1) 2.87%(2) 1.97% 12.99% 25.45% (6.47)%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 3,257 $ 3,960 $ 4,404 $ 2,709 $ 626
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.22%(3) 2.19% 2.16% 2.26% 2.22%(3)
Net investment income (loss) (1.35)%(3) (1.19)% (1.31)% (1.35)% (1.37)%(3)
Portfolio turnover 17%(2) 22% 16% 17% 16%(2)
CLASS C
----------------------------------------------------------------------
FROM INCEPTION
SIX MONTHS AUGUST 30,
ENDED YEAR ENDED DECEMBER 31, 2002 TO
JUNE 30, 2006 ---------------------------------------- DECEMBER 31,
(UNAUDITED) 2005 2004 2003 2002
Net asset value, beginning of period $ 20.69 $ 20.30 $ 17.96 $ 14.31 $ 15.29
INCOME FROM INVESTMENT OPERATIONS
Net investment income (loss) (0.14)(4) (0.23)(4) (0.24)(4) (0.20)(4) (0.03)
Net realized and unrealized gain (loss) 0.71 0.62 2.58 3.85 (0.95)
-------- -------- -------- -------- --------
TOTAL FROM INVESTMENT OPERATIONS 0.57 0.39 2.34 3.65 (0.98)
-------- -------- -------- -------- --------
LESS DISTRIBUTIONS
Distributions from net realized gains (0.65) -- -- -- --
-------- -------- -------- -------- --------
TOTAL DISTRIBUTIONS (0.65) -- -- -- --
-------- -------- -------- -------- --------
Change in net asset value (0.08) 0.39 2.34 3.65 (0.98)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD $ 20.61 $ 20.69 $ 20.30 $ 17.96 $ 14.31
======== ======== ======== ======== ========
Total return(1) 2.86%(2) 1.92% 13.03% 25.59% (6.47)%(2)
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (thousands) $ 12,504 $ 14,102 $ 17,845 $ 12,565 $ 572
RATIO TO AVERAGE NET ASSETS OF:
Operating expenses 2.22%(3) 2.19% 2.16% 2.26% 2.22%(3)
Net investment income (loss) (1.35)%(3) (1.19)% (1.31)% (1.35)% (1.37)%(3)
Portfolio turnover 17%(2) 22% 16% 17% 16%(2)
(1) Sales charges are not reflected in the total return calculation.
(2) Not annualized.
(3) Annualized.
(4) Computed using average shares outstanding.
24 See Notes to Financial Statements
PHOENIX ASSET TRUST
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2006 (UNAUDITED)
1. ORGANIZATION
Phoenix Asset Trust (the "Trust") (formerly Phoenix-Kayne Funds) is
organized as a Delaware business trust and is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
Currently three Funds are offered for sale (each a "Fund") The Phoenix CA
Intermediate Tax-Free Bond Fund ("CA Bond Fund") is a non-diversified fund and
seeks income exempt from federal and California state personal income taxes. The
Phoenix Rising Dividends Fund ("Rising Dividends Fund") is a diversified fund
and seeks long-term capital appreciation, with dividend income as a secondary
consideration. The Phoenix Small-Mid Cap Fund ("Small-Mid Cap Fund") is a
diversified fund and seeks long-term capital appreciation, with dividend income
as a secondary consideration.
The Funds offer the following classes of shares for sale:
Class X Class A Class B Class C
------- ------- ------- -------
CA Bond Fund ....................... X -- -- --
Rising Dividends Fund .............. X X X X
Small-Mid Cap Fund ................. X X X X
Class X shares are sold without a sales charge. Class A shares are sold
with a front-end sales charge of up to 5.75%. Generally, Class A shares are not
subject to any charges by the funds when redeemed; however, a 1% contingent
deferred sales charge may be imposed on certain redemptions within one year on
purchases on which a finder's fee has been paid. Class B shares are sold with a
contingent deferred sales charge, which declines from 5% to zero depending on
the period of time the shares are held. Class C shares are sold with a 1%
contingent deferred sales charge if redeemed within one year of purchase.
Each class of shares has identical voting, dividend, liquidation and other
rights and the same terms and conditions, except that each class bears different
distribution and/or service expenses and has exclusive voting rights with
respect to its distribution plan. Class X bears no distribution and/or service
expenses. Income and expenses and realized and unrealized gains and losses of
each Fund are borne pro rata by the holders of each class of shares.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amount of increases and decreases in
net assets from operations during the reporting period. Actual results could
differ from those estimates.
A. SECURITY VALUATION:
Equity securities are valued at the official closing price (typically last
sale) on the exchange on which the securities are primarily traded, or if no
closing price is available, at the last bid price.
Debt securities are valued on the basis of broker quotations or valuations
provided by a pricing service, which utilizes information with respect to recent
sales, market transactions in comparable securities, quotations from dealers,
and various relationships between securities in determining value.
As required, some securities and assets may be valued at fair value as
determined in good faith by or under the direction of the Trustees.
Certain foreign common stocks may be fair valued in cases where closing
prices are not readily available or are deemed not reflective of readily
available market prices. For example, significant events (such as movement in
the U.S. securities market, or other regional and local developments) may occur
between the time that foreign markets close (where the security is principally
traded) and the time that the Fund calculates its net asset value (generally,
the close of the NYSE) that may impact the value of securities traded in these
foreign markets. In these cases, information from an external vendor may be
utilized to adjust closing market prices of certain foreign common stocks to
reflect their fair value. Because the frequency of significant events is not
predictable, fair valuation of certain foreign common stocks may occur on a
frequent basis.
Short-term investments having a remaining maturity of 60 days or less are
valued at amortized cost, which approximates market.
B. SECURITY TRANSACTIONS AND RELATED INCOME:
Security transactions are recorded on the trade date. Dividend income is
recorded on the ex-dividend date, or in the case of certain foreign securities,
as soon as the Fund is notified. Interest income is recorded on the accrual
basis. Each Fund amortizes premiums and accretes discounts using the effective
interest method. Realized gains and losses are determined on the identified cost
basis.
C. INCOME TAXES:
Each Fund is treated as a separate taxable entity. It is the policy of
each Fund in the Trust to comply with the requirements of the Internal Revenue
Code and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes or excise taxes
has been made.
The Trust may be subject to foreign taxes on income, gains on investments
or currency repatriation, a portion of which may be recoverable. Each Fund will
accrue such taxes and recoveries as applicable based upon current
interpretations of the tax rules and regulations that exist in the markets in
which they invest.
In June 2006, the Financial Accounting Standards Board (FASB) issued FASB
Interpretation 48 ("FIN 48"), "Accounting for Uncertainty in Income Taxes." This
standard defines the threshold for recognizing
25
PHOENIX ASSET TRUST
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2006 (UNAUDITED) (CONTINUED)
the benefits of tax-return positions in the financial statements as
"more-likely-than-not" to be sustained by the taxing authority and requires
measurement of a tax position meeting the more-likely-than-not criterion, based
on the largest benefit that is more than 50 percent likely to be realized. FIN
48 is effective as of the beginning of the first fiscal year beginning after
December 15, 2006 (January 1, 2007 for calendar-year companies), with early
application permitted if no interim financial statements have been issued. At
adoption, companies must adjust their financial statements to reflect only those
tax positions that are more likely-than-not to be sustained as of the adoption
date. As of June 30, 2006, the Funds have not completed their evaluation of the
impact that will result from adopting FIN 48.
D. DISTRIBUTIONS TO SHAREHOLDERS:
Distributions are recorded by each Fund on the ex-dividend date. For the
CA Bond Fund, income distributions are recorded daily. Income and capital gain
distributions are determined in accordance with income tax regulations which may
differ from accounting principles generally accepted in the United States of
America. These differences may include the treatment of non-taxable dividends,
market premium and discount, non-deductible expenses, expiring capital loss
carryovers, foreign currency gain or loss, gain or loss on futures contracts,
partnerships, operating losses and losses deferred due to wash sales. Permanent
book and tax basis differences relating to shareholder distributions will result
in reclassifications to capital paid in on shares of beneficial interest.
E. EXPENSES:
Expenses incurred by the Trust with respect to more than one Fund are
allocated in proportion to the net assets of each Fund, except where allocation
of direct expense to each Fund or an alternative allocation method can be more
appropriately made.
F. FOREIGN CURRENCY TRANSLATION:
Foreign securities and other assets and liabilities are valued using the
foreign currency exchange rate effective at the end of the reporting period.
Cost of investments is translated at the currency exchange rate effective at the
trade date. The gain or loss resulting from a change in currency exchange rates
between the trade and settlement date of a portfolio transaction is treated as a
gain or loss on foreign currency. Likewise, the gain or loss resulting from a
change in currency exchange rates between the date income is accrued and paid is
treated as a gain or loss on foreign currency. The Trust does not isolate that
portion of the results of operations arising from either changes in exchange
rates or in the market prices of securities.
G. FOREIGN SECURITY COUNTRY DETERMINATION:
A combination of the following criteria is used to assign the countries of
risk listed in the schedules of investments: country of incorporation, actual
building address, primary exchange on which the security is traded and country
in which the greatest percentage of company revenue is generated.
H. SECURITIES LENDING:
Certain Funds may loan securities to qualified brokers through an
agreement with State Street Bank and Trust (the "Custodian"). Under the terms of
the agreement, the Fund receives collateral with a market value not less than
100% of the market value of loaned securities. Collateral is adjusted daily in
connection with changes in the market value of securities on loan. Collateral
may consist of cash, securities issued or guaranteed by the U.S. Government or
its agencies and the sovereign debt of foreign countries. Cash collateral has
been invested in a short-term money market fund. Dividends earned on the
collateral and premiums paid by the borrower are recorded as income by the Fund
net of fees and rebates charged by the Custodian for its services in connection
with this securities lending program. Lending portfolio securities involves a
risk of delay in the recovery of the loaned securities or in the foreclosure on
collateral.
3. INVESTMENT ADVISORY FEE AND RELATED PARTY TRANSACTIONS
Kayne Anderson Rudnick Investment Management, LLC ("Kayne") (the
"Adviser") is the investment adviser to the Funds. Kayne is a wholly-owned
subsidiary of Phoenix Investment Partners, Ltd. ("PXP"). PXP is an indirect,
wholly-owned subsidiary of The Phoenix Companies, Inc. ("PNX"). As compensation
for its services to the Funds, the Adviser is entitled to a fee based upon the
following annual rates as a percentage of the average daily net assets of each
Fund:
CA Bond Fund ................................................ 0.50%
Rising Dividends Fund ....................................... 0.75%
Small-Mid Cap Fund .......................................... 0.85%
The Adviser has contractually agreed to reimburse the CA Bond Fund's total
annual operating expenses (excluding interest, taxes, and extraordinary
expenses) through April 30, 2007, so that such expenses do not exceed 0.75%. The
Adviser will not seek to recapture any operating expenses reimbursed under this
agreement.
As distributor of each Fund's shares, Phoenix Equity Planning Corporation
("PEPCO") an indirect wholly-owned subsidiary of PNX, has advised the Funds that
it retained net selling commissions and deferred sales charges for the
six-months (the "period") ended June 30, 2006, as follows:
Class A Class B Class C
Net Selling Deferred Deferred
Commissions Sales Charges Sales Charges
----------- ------------- -------------
Rising Dividends Fund ............ $240 $8,427 $ 80
Small-Mid Cap Fund ............... 878 6,575 2,615
26
PHOENIX ASSET TRUST
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2006 (UNAUDITED) (CONTINUED)
In addition, each Fund pays PEPCO distribution and/or service fees at an
annual rate of 0.25% for Class A shares, 1.00% for Class B shares and 1.00% for
Class C shares applied to the average daily net assets of each respective Class.
Under certain circumstances, shares of certain Phoenix Funds may be
exchanged for shares of the same class of certain other Phoenix Funds on the
basis of the relative net asset values per share at the time of the exchange. On
exchanges with share classes that carry a contingent deferred sales charge, the
CDSC schedule of the original shares purchased continues to apply.
As financial agent of the Trust, PEPCO receives a financial agent fee
equal to the sum of (1) the documented cost to PEPCO to provide oversight of the
performance of PFPC Inc. (subagent to PEPCO), plus (2) the documented cost of
fund accounting, tax services and related services provided by PFPC Inc. For the
period ended June 30, 2006, the Trust incurred financial agent fees totaling
$128,933.
PEPCO serves as the Trust's transfer agent with State Street Bank and
Trust Company serving as subtransfer agent. For the period ended June 30, 2006,
transfer agent fees were $124,837 as reported in the Statements of Operations,
of which PEPCO retained the following:
Transfer Agent
Fee Retained
--------------
Small-Mid Cap Fund ............................................. $4,746
At June 30, 2006, PNX and its affiliates, the retirement plans of PNX and
its affiliates, and Phoenix affiliated Funds held shares which aggregated the
following:
Aggregate
Net Asset
Shares Value
------- -----------
Rising Dividends Fund
Class B ...................................... 7,442 $ 113,565
Class C ...................................... 7,437 113,563
Small-Mid Cap Fund.............................. 1,806 37,186
4. PURCHASES AND SALES OF SECURITIES
Purchases and sales of securities (excluding U.S. Government and agency
securities and short-term securities) for the period ended June 30, 2006, were
as follows:
Purchases Sales
----------- -----------
CA Bond Fund ................................... $ 4,910,403 $10,236,415
Rising Dividends Fund .......................... 25,967,477 34,366,887
Small-Mid Cap Fund ............................. 22,381,260 42,183,097
There were no purchases or sales of long-term U.S. Government and agency
securities for the period ended June 30, 2006.
5. 10% SHAREHOLDERS
As June 30, 2006, certain Funds had individual shareholder accounts and/or
omnibus shareholder accounts (which are comprised of a group of individual
shareholders), which individually amounted to more than 10% of the total shares
outstanding of the fund as detailed below. The shareholders are not affiliated
with PNX.
% Shares
Outstanding
-----------
CA Bond Fund ............................................. 70.8%
Rising Dividends Fund .................................... 11.6
6. ASSET CONCENTRATIONS
Certain Funds may invest a high percentage of their assets in specific
sectors of the market in their pursuit of a greater investment return.
Fluctuations in these sectors of concentration may have a greater impact on a
Fund, positive or negative, than if a Fund did not concentrate its investments
in such sectors.
The CA Bond Fund invests primarily in California municipal securities and
is more susceptible to economic, political and other developments that may
adversely affect issuers of such securities than a more geographically
diversified fund. Such developments could result in certain adverse consequences
including impairing the market value and marketability of the securities, as
well as impairing the ability of certain issuers of California municipal
securities to pay principal and interest on their obligations. At June 30, 2006,
the CA Bond Fund was invested 96.8% in California municipal securities.
7. INDEMNIFICATIONS
Under the Funds' organizational documents, their trustees and officers are
indemnified against certain liabilities arising out of the performance of their
duties to the Funds. In addition, the Funds enter into contracts that contain a
variety of indemnifications. The Funds' maximum exposure under these
arrangements is unknown. However, the Funds have not had prior claims or losses
pursuant to these contracts and expect the risk of loss to be remote.
8. REGULATORY EXAMS
Federal and state regulatory authorities from time to time make inquiries
and conduct examinations regarding compliance by The Phoenix Companies, Inc. and
its subsidiaries (collectively "the Company") with securities and other laws and
regulations affecting their registered products. During 2004 and 2005, the
Boston District Office of the Securities and Exchange Commission ("SEC")
conducted an examination of the Company's investment company and investment
adviser affiliates. Following the examination, the staff of the Boston District
Office issued a deficiency letter noting perceived weaknesses in procedures for
monitoring trading to prevent market timing activity prior to 2004. The staff
requested the Company to conduct an analysis as to whether shareholders,
policyholders and contract holders who
27
PHOENIX ASSET TRUST
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2006 (UNAUDITED) (CONTINUED)
invested in the funds that may have been affected by undetected market timing
activity had suffered harm and to advise the staff whether the Company believes
reimbursement is necessary or appropriate under the circumstances. Market timing
is an investment technique involving frequent short-term trading of mutual fund
shares that is designed to exploit market movements or inefficiencies in the way
mutual fund companies price their shares. A third party was retained to assist
the Company in preparing the analysis. In 2005, based on the third party
analysis the Company notified the staff at the SEC Boston District Office that
reimbursements were not appropriate under the circumstances. The Company does
not believe that the outcome of this matter will be material to these financial
statements.
9. FEDERAL INCOME TAX INFORMATION
The Funds have capital loss carryovers which may be used to offset future
capital gains, as follows:
Expiration Year
2006 2010 2011 Total
-------- ---------- ---------- -----------
Rising Dividends Fund .. $ -- $6,937,638 $4,873,757 $11,811,395
Small-Mid Cap Fund ..... 838,736 -- -- 838,736
The Funds may not realize the benefit of these losses to the extent each
Fund does not realize gains on investments prior to the expiration of the
capital loss carryovers.
28
PHOENIX ASSET TRUST
101 Munson Street
Greenfield, MA 01301-9668
TRUSTEES
E. Virgil Conway
Harry Dalzell-Payne
Daniel T. Geraci
Francis E. Jeffries
Leroy Keith, Jr.
Marilyn E. LaMarche
Philip R. McLoughlin, Chairman
Geraldine M. McNamara
James M. Oates
Richard E. Segerson
Ferdinand L. J. Verdonck
OFFICERS
Daniel T. Geraci, President
George R. Aylward, Executive Vice President
Nancy G. Curtiss, Senior Vice President
Francis G. Waltman, Senior Vice President
Marc Baltuch, Vice President and Chief
Compliance Officer
W. Patrick Bradley, Chief Financial Officer
and Treasurer
Kevin J. Carr, Vice President, Counsel, Secretary and
Chief Legal Officer
INVESTMENT ADVISER
Kayne Anderson Rudnick Investment
Management, LLC
1800 Avenue of the Stars, 2nd Floor
Los Angeles, CA 90067-4212
PRINCIPAL UNDERWRITER
Phoenix Equity Planning Corporation
One American Row
Hartford, CT 06103-2899
TRANSFER AGENT
Phoenix Equity Planning Corporation
One American Row
Hartford, CT 06103-2899
CUSTODIAN
State Street Bank and Trust Company
P.O. Box 5501
Boston, MA 02206-5501
HOW TO CONTACT US
Mutual Fund Services 1-800-243-1574
Advisor Consulting Group 1-800-243-4361
Telephone Orders 1-800-367-5877
Text Telephone 1-800-243-1926
Web site PHOENIXFUNDS.COM
- --------------------------------------------------------------------------------
IMPORTANT NOTICE TO SHAREHOLDERS
The Securities and Exchange Commission has modified mailing regulations for
semiannual and annual shareholder fund reports to allow mutual fund companies to
send a single copy of these reports to shareholders who share the same mailing
address. If you would like additional copies, please call Mutual Fund Services
at 1-800-243-1574.
- --------------------------------------------------------------------------------
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---------------
PRESORTED
STANDARD
U.S. POSTAGE
PAID
Louisville, KY
Permit No. 1051
---------------
[LOGO] PHOENIXFUNDS(SM)
PHOENIX EQUITY PLANNING CORPORATION
P.O. Box 150480
Hartford, CT 06115-0480
For more information about Phoenix mutual funds,
please call your financial representative, contact us
at 1-800-243-1574 or visit PHOENIXFUNDS.COM.
NOT INSURED BY FDIC/NCUSIF OR ANY FEDERAL GOVERNMENT AGENCY.
NO BANK GUARANTEE. NOT A DEPOSIT. MAY LOSE VALUE.
PXP1739 8-06
BPD27038
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of trustees, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14A (17 CFR
240.14a-101), or this Item.
ITEM 11. 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 the 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
Securities Exchange Act of 1934, as amended (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 second
fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are 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) Phoenix Asset Trust
--------------------------------------------------------------------
By (Signature and Title)* /s/ George R. Aylward
-------------------------------------------------------
George R. Aylward, Executive Vice President
(principal executive officer)
Date September 5, 2006
---------------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ George R. Aylward
-------------------------------------------------------
George R. Aylward, Executive Vice President
(principal executive officer)
Date September 5, 2006
---------------------------------------------------------------------------
By (Signature and Title)* /s/ W. Patrick Bradley
------------------------------------------------------
W. Patrick Bradley, Chief Financial Officer
and Treasurer
(principal financial officer)
Date September 5, 2006
---------------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.