UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM N-CSR
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CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
INVESTMENT COMPANY ACT FILE NUMBER 811-01911
SCHRODER CAPITAL FUNDS (DELAWARE)
(Exact name of registrant as specified in charter)
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875 Third Avenue, 22nd Floor
New York, NY 10022
(Address of principal executive offices) (Zip code)
Schroder Capital Funds (Delaware)
P.O. Box 8507
Boston, MA 02266
(Name and address of agent for service)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-800-464-3108
DATE OF FISCAL YEAR END: OCTOBER 31, 2007
DATE OF REPORTING PERIOD: OCTOBER 31, 2007
ITEM 1. REPORTS TO STOCKHOLDERS.
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SCHRODER MUTUAL FUNDS
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OCTOBER 31, 2007 ANNUAL REPORT
Schroder North American Equity Fund
Schroder International Diversified Value Fund
Schroder U.S. Opportunities Fund
Schroder U.S. Small and Mid Cap Opportunities Fund
Schroder International Alpha Fund
Schroder Emerging Market Equity Fund
Schroder Enhanced Income Fund
Schroder Strategic Bond Fund
Schroder Total Return Fixed Income Fund
Schroder Municipal Bond Fund
Schroder Short-Term Municipal Bond Fund
[LOGO] SCHRODERS
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SCHRODER MUTUAL FUNDS
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December 14, 2007
Dear Shareholder:
We are pleased to provide the Annual Report to shareholders of the Schroder
Mutual Funds, which covers the fiscal year ended October 31, 2007. The Report
includes information designed to help you understand the status of your
investment -- the Management Discussion and Analysis prepared by each portfolio
manager explains how they put your money to work in various markets; the
Schedules of Investments give you a point-in-time picture of the holdings in
your fund; and additional information includes a detailed breakdown of other
financial information. We encourage you to read the Report and thank you for
making Schroders part of your financial plan.
The one-year period under review offered investors in most asset classes
positive returns, despite volatility in international equity and fixed income
markets and the ongoing problems in the subprime markets. Long-term
fundamentals, however, remained relatively favorable to equities as global
interest rate levels overall stayed fairly benign and valuations were not
stretched. Global equity markets enjoyed strong support for the majority of the
one-year period, helping the MSCI World Index record a fifth consecutive year of
gains while inflows to emerging markets remained strong. Investors, however,
have turned cautious -- as seen by the severity of the market correction
beginning over the summer and continued volatility. Markets rebounded somewhat,
yet this summer's credit concerns continue to cast a pall.
Among some of the key macro trends in the markets over the past year: mergers
and acquisitions ("M&A") activity stayed high while good global market
performance also drove up equity prices through October. However, the U.S.
housing market as affected by concerns regarding the subprime lending market
interest rates, the specter of potential inflation, ongoing turmoil in the
Middle East and higher oil prices have all combined to raise concerns about the
global economy's future growth.
Asia continues to be a bright spot, where China and Korea are powering economic
growth. The Eurozone is now firmly entrenched in the current global expansion
and is still being led primarily by a robust Germany, which has created over
half a million new jobs over the last year. The French, too, have joined the
action, reporting improved production statistics. The UK economy remains buoyant
with retail sales positive and the housing market just beginning to show signs
of significant cooling. This has increased the likelihood that the Bank of
England will cut interest rate cuts in the coming year.
Liquidity flows and M&A activity were strong for the majority of the year under
review. Despite lingering subprime credit concerns, M&A activity has continued
into the second half of 2007 and international activity spiked, with
cross-border deals accounting for roughly 40% of transactions in 2007.
It's possible to draw some parallels between what is going on in the global
economy today and events in Japan almost twenty years ago. After the Japanese
boom came to an abrupt halt in 1989, the Bank of Japan cut interest rates which
fell over the next ten years to practically zero in a desperate attempt to
resuscitate growth -- the economy effectively came unstuck as even these low
interest rates failed to revive activity. Confidence had been lost.
The U.S. central bank, the Federal Reserve (the "Fed"), has clearly been taking
notes and has already taken appropriate action to try and avoid a similar
situation in the U.S. The Japanese stock market crash showed that in a so-called
"credit crunch" scenario interest rates need to be cut quickly and aggressively.
The speed and size of cuts have historically proved to be crucial in restoring
investor confidence quickly. It would seem that the Fed has learned from this
with rate cuts on September 18, October 31 and December 11. The September 18 cut
was larger than many expected and had the desired effect -- investors were
reassured and the markets responded positively.
It appears, though, that problems in the housing market will impact U.S.
consumer spending which until very recently had held steady. As property prices
fall and energy prices rise, we've begun to see a drag on consumer spending,
further contributing to the U.S. slowdown. It remains to be seen whether the
Fed's December 11 rate cut will limit the impact of the slowdown.
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1
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SCHRODER MUTUAL FUNDS
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While economic activity in the U.S. and globally is slowing we are not overly
pessimistic about the outlook for the global economy. While forecasts for 2008
U.S. growth have been significantly trimmed, global growth forecasts have only
been modestly reduced. With problems in the U.S. largely concentrated in the
domestic housing market, the export businesses of Europe and Asia have not
suffered too dramatically as a result.
As the U.S. dollar plumbs new lows against the euro and the pound, there is, in
fact, evidence that now clearly shows a significant degree of de-coupling from
the U.S., with demand both from within Europe and also the fast-growing Asian
economies helping offset the effects of a slowing U.S. economy. The appearance
of this de-coupling pattern is a significant development over the past year.
While no one expects Europe to remain immune to an all-out U.S. recession, there
are in fact some trends that help explain Europe's performance against a
sluggish U.S. A study of changes in Eurozone export data over the last few years
proves illuminating. In 2001 exports to 'emerging' Europe and all of Asia
ex-Japan added together was just 1.6 times the volume of trade with the U.S.
After 2003, however, exports to both Asia and Eastern Europe became more
important than trade with the U.S. The most recent data shows that Eurozone
exports to emerging Europe -- including Russia and Turkey -- and Asia are now
2.6 times higher than those to the U.S.
Our overall outlook for 2008 remains cautiously optimistic. While we expect a
slowdown, both globally and in the U.S., we do not see the current conditions as
the start of a more significant downturn in growth. Although one can never
predict with absolute certainty, we believe that the economy will move into a
period of moderate but continued positive growth with controlled inflation and
U.S. interest rates falling in the first half of 2008. That said, we are
cautiously optimistic about the prospects for global growth; while we do not
think recession is likely, it is difficult to say what could happen to global
growth should the U.S. fall into a full-blown recession.
In this type of environment, we believe that the investor who maintains a
diversified portfolio -- both across asset classes and geographic borders --
should be able to weather the bumpy periods better than those who have high
concentrations in one or two sectors. We encourage you to consult with your
financial advisor to ascertain whether your current mix of investments is
suitable for your long-term objectives.
Again, we thank you for including Schroders in your financial plan and we look
forward to our continued relationship.
Sincerely,
/s/ Mark A. Hemenetz
Mark A. Hemenetz, CFA
President
1. PLEASE NOTE THAT STOCK AND SECTOR ATTRIBUTION IS MORE MEANINGFUL OVER LONGER
TIME PERIODS.
2. THE VIEWS EXPRESSED IN THE FOLLOWING REPORT WERE THOSE OF EACH RESPECTIVE
FUND'S PORTFOLIO MANAGEMENT TEAM AS OF THE DATE SPECIFIED, AND MAY NOT REFLECT
THE VIEWS OF THE PORTFOLIO MANAGERS ON THE DATE THIS ANNUAL REPORT IS PUBLISHED
OR ANY TIME THEREAFTER. THESE VIEWS ARE INTENDED TO ASSIST SHAREHOLDERS OF THE
FUNDS IN UNDERSTANDING THEIR INVESTMENT IN THE FUNDS AND DO NOT CONSTITUTE
INVESTMENT ADVICE; INVESTORS SHOULD CONSULT THEIR OWN INVESTMENT PROFESSIONALS
AS TO THEIR INDIVIDUAL INVESTMENT PROGRAMS. CERTAIN SECURITIES DESCRIBED IN
THESE REPORTS MAY NO LONGER BE HELD BY THE FUNDS AND THEREFORE NO LONGER APPEAR
IN THE SCHEDULES OF INVESTMENTS AS OF OCTOBER 31, 2007.
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2
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SCHRODER NORTH AMERICAN EQUITY FUND
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MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
In the 12 months ended October 31, 2007, the Schroder North American Equity Fund
(the "Fund") rose 15.08% (Investor Shares) and 14.66% (Advisor Shares), compared
to the FTSE North American Index (the "Index"), a broad-based basket of North
American stocks, which rose 16.74%. For the same 12-month period, the S&P 500
Index increased 14.56%.
MARKET BACKGROUND
North American equity markets performed well in the review period as a whole,
supported by the broadly favorable macroeconomic environment, strong corporate
profits growth and merger and acquisitions activity. Volatility increased
markedly in the latter part of the period, however, in response to the
escalating subprime mortgage crisis. The Federal Reserve cut U.S. interest rates
twice in an attempt to ease fears of a global credit crunch and markets rallied
in response, although concerns over the outlook for the U.S. economy, and the
consumer in particular, remained.
The materials and energy sectors were the best performing sectors as commodity
prices rose supported by continued Chinese growth. The technology sector also
outperformed as the market anticipated resilient demand. The utilities,
industrials and telecommunications sectors produced above-Index returns while
consumer discretionary and financials stocks were weakest, reflecting the
uncertain outlook for U.S. consumer spending and the problems in the subprime
mortgage sector which forced several high profile investment banks to announce
large write-downs in their third quarter results.
PORTFOLIO REVIEW
The Fund's portfolio consists of numerous small stock positions diversified
across sectors and industries. Sector positions are kept within narrow limits
compared to the Index as part of the risk management process; in general,
activity over the past 12 months resulted in a reduction to risky, high beta
stocks including consumer-sensitive stocks, select financials and energy
equipment companies, and an increase to the Fund's telecommunications exposure.
The Fund's managers retained a cautious stance towards the U.S. consumer,
favoring consumer staple stocks such as beverages and food retailers, and added
to the technology sector as good value emerged among large-cap semiconductor and
IT services stocks.
The Fund benefited from good positioning within the consumer discretionary
sector through its underweighting of poorly performing retailers (MACYS, HOME
DEPOT) and holdings in stocks such as SHAW COMMUNICATIONS and GARMIN, the
navigation device maker. The Fund also outperformed the Index in the
telecommunications sector, where several good quality stocks with high
profitability were found. Relative returns were weak in the energy, financials
and utilities sectors, and the Fund underperformed the Index overall. Within the
energy sector, a preference for large integrated oil companies over high beta
energy equipment stocks proved detrimental as the latter outperformed, while in
the financials sector holdings in banks and real estate stocks were also weak.
Underweight positions in strongly-performing utilities (ENTERGY, CONSTELLATION
ENERGY) detracted from performance in the review period, as did several
underweight positions in large cap industrials and technology stocks.
OUTLOOK
We believe that the market remains vulnerable to continued problems in the
credit market. Attention is likely to remain focused on whether the weakness in
the housing market will be reflected in consumer demand, which is the driver of
the U.S. economy. The strongest returns during the recent market turmoil have
come from those sectors perceived as least vulnerable to an anemic domestic U.S.
economy and those companies that can profit from a weaker U.S. exchange rate and
resilience in emerging markets. The Fund remains highly diversified with an
emphasis on stocks offering what we believe is good value, high quality and
positive momentum.
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3
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SCHRODER NORTH AMERICAN EQUITY FUND
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COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER NORTH AMERICAN EQUITY FUND -- INVESTOR OR ADVISOR SHARES
VS. THE STANDARD & POOR'S (S&P) 500 INDEX, AND THE FTSE
NORTH AMERICAN (NA) INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder North Schroder North
American Equity Fund, American Equity Fund, S&P 500 FTSE NA
Investor Shares Advisor Shares Index Index
9/17/03 $10,000 $10,000 $10,000 $10,000
10/31/03 10,280 10,278 10,262 10,278
10/31/04 11,348 11,309 11,228 11,331
10/31/05 12,536 12,460 12,207 12,552
10/31/06 14,547 14,410 14,202 14,696
10/31/07 16,740 16,523 16,270 17,156
The FTSE North American Index is a market capitalization value weighted
composite index of over 700 U.S. and Canadian companies and reflects the
reinvestment of dividends. The S&P 500 Index is a market capitalization value
weighted composite index of 500 large capitalization U.S. companies and reflects
the reinvestment of dividends.
PERFORMANCE INFORMATION
One Year Annualized
Ended Since
October 31, 2007 Inception
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Schroder North American Equity Fund --
Investor Shares ............................ 15.08% 13.32%(a)
Advisor Shares ............................. 14.66% 12.96%(b)
(a) The Investor Shares commenced operations on September 17, 2003.
(b) The Advisor Shares commenced operations on March 31, 2006. The performance
information provided in the line graph and the performance information table for
periods prior to March 31, 2006 reflects the performance of the Investor Shares
of the Fund, adjusted to reflect the distribution fees paid by Advisor Shares.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RESULTS
REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS. THE VALUE OF AN
INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL FLUCTUATE AND
REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY % OF INVESTMENTS
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Exxon Mobil 3.4%
General Electric 2.7
Microsoft 2.2
Procter & Gamble 1.6
Bank of America 1.5
SECTOR ALLOCATION
SECTOR % OF INVESTMENTS
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Manufacturing 46.8%
Finance, Insurance and Real Estate 21.2
Transportation, Communications, Electric, Gas and Sanitary
Services 10.2
Services 9.0
Retail Trade 5.5
Mining 4.0
Wholesale Trade 1.7
Agriculture, Forestry and Fishing 1.1
Construction 0.1
Short-Term Investment 0.4
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4
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SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
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MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
In the 12 months ended October 31, 2007, the Schroder International Diversified
Value Fund (the "Fund") rose 31.56% (Investor Shares) and 31.31% (Advisor
Shares), compared to the Morgan Stanley Capital International EAFE Index (the
"Index"), a broad-based basket of international stocks, which rose 24.92% during
this same period.
MARKET BACKGROUND
International equity markets produced strong gains in the review period,
supported by the initially favorable macroeconomic environment with strong
corporate profits growth and merger and acquisitions activity. Volatility
increased markedly in the latter part of the period, however, in response to the
escalating subprime mortgage crisis in the U.S. The Federal Reserve cut U.S.
interest rates twice in an attempt to ease fears of a global credit crunch and
markets rallied in response, although concerns over the outlook for the U.S.
economy, and the consumer in particular, remained.
The materials sector outperformed in the year, reflecting an expectation that
the strong demand for commodities from Asian emerging markets would continue.
Telecommunications stocks also performed strongly as investors began to
recognize the value that had become apparent in the sector. The industrials,
utilities, consumer staples and energy sectors produced above-index returns.
Consumer discretionary, technology and financials stocks did comparatively
poorly while performance of the healthcare sector was under pressure from the
familiar problems of generic competition and weak new drug pipelines.
PORTFOLIO REVIEW
Continental Europe has been a good source of value over the past 12 months and
the Pacific ex-Japan weight has declined following profit-taking after strong
relative performance. Recent sector-level activity has included sales of
strongly performing industrials (particularly marine stocks in the Pacific
ex-Japan region) and profit-taking in several integrated oil holdings following
strong gains. Over the period as a whole the Fund added to the energy sector as
we do not believe that valuations are fully reflecting the strong moves in oil
prices. The Fund also increased holdings in the telecommunications sector, which
we continue to believe offers good value.
The Fund produced strong gains in the review period and significantly
outperformed the Index. Performance was strongest in the Pacific region, with
positive contributions from marine, real estate and steel stocks in the Pacific
ex-Japan and the Fund's low exposure to Japanese financials relative to the
Index. The Fund also benefited from its exposure to the emerging markets, which
significantly outperformed developed markets in the year, as well as benefiting
from its holdings in Canadian stocks.
The Fund outperformed the Index in the majority of sectors. Of particular note
were oil and gas stocks in continental Europe, the Pacific and emerging markets;
industrials holdings, particularly in the Pacific ex-Japan region; and
telecommunications stocks in all markets except the UK and Japan. The Fund's
comparatively low weight in the healthcare sector versus market cap weighted
indices also added value in the review period.
OUTLOOK
The market remains vulnerable to continued poor news coverage as the problems in
the credit market unravel. Attention is likely to remain focused on the U.S.
economy, especially for signs of the effect on American consumers of falling
house prices, and whether emerging markets can decouple from the U.S. and
support global growth. We do not attempt to predict the market's next move but,
rather, position the Fund to deliver superior long-term returns. Through our
research, we believe that this can be achieved with a long-run value bias,
together with its non-market cap approach to stock weighting and unconstrained,
bottom-up sector and country weights.
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5
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SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
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COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND -- INVESTOR OR ADVISOR SHARES
VS. THE MORGAN STANLEY CAPITAL INTERNATIONAL (MSCI) EAFE INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Schroder
International International
Diversified Diversified
Value Fund, Value Fund,
Investor Shares Advisor Shares MSCI EAFE Index
8/30/06 $10,000 $10,000 $10,000
10/31/06 10,540 10,530 10,407
10/31/07 13,867 13,827 13,000
The MSCI EAFE Index is a market weighted index composed of companies
representative of the market structure of certain developed market countries in
Europe, Australia, Asia and the Far East, and reflects dividends reinvested net
of non-recoverable withholding tax.
PERFORMANCE INFORMATION
One Year Annualized
Ended Since
October 31, 2007 Inception (a)
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Schroder International Diversified Value Fund --
Investor Shares ................................. 31.56% 32.25%
Advisor Shares .................................. 31.31% 31.93%
(a) From commencement of Fund operations on August 30, 2006.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY* % OF INVESTMENTS
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Telenor 0.5%
BCE 0.5
Belgacom 0.5
Renault 0.5
Outokupu 0.5
* Excludes any Short-Term Investments.
GEOGRAPHIC ALLOCATION
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[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
% of Investments
Continental Europe 45.0%
United Kingdom 14.8
Japan 13.0
Emerging Markets 10.4
Pacific ex-Japan 10.1
North America 5.9
Short-Term Investment 0.8
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6
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SCHRODER U.S. OPPORTUNITIES FUND
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MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
In the 12 months ended October 31, 2007, the Schroder U.S. Opportunities Fund
(the "Fund") rose 20.02% (Investor Shares) and 19.76% (Advisor Shares), compared
to the Russell 2000 Index (the "Index"), a broad-based basket of stocks with
characteristics similar to the Fund's portfolio, which rose 9.27%.
The Fund's outperformance of the Index was driven by strong stock selection. In
particular, stock selection in the materials and processing, financial services
and energy sectors contributed to performance. Stock selection detracted in only
two sectors: producer durable and consumer staples.
MARKET BACKGROUND
The year was favorable for small cap stocks. Small companies generally produced
strong returns over this time as the Federal Reserve reduced interest rates
0.75% over the year to 4.50% as of the end of October and held out the
possibility of another rate cut in the future. Despite the market turmoil around
the subprime mortgage crisis and housing market correction which intensified in
August, overall economic and market conditions -- such robust growth over the
past two quarters in the U.S. economy -- were favorable for investors.
PORTFOLIO REVIEW
During the twelve-month period the Fund performed well, with stock selection
adding value in eight out of ten sectors. Strong contributors to outperformance
were SHAW GROUP (provider of piping systems, engineering, procurement and
construction services) and PERINI (a construction services company), both of
which announced strong earnings results and gave positive guidance for 2007.
DRESSER-RAND GROUP (a manufacturer of equipment solutions to the oil and gas
industries) also added significant value to the portfolio. All of these
companies have exposure to the energy market and therefore benefited from the
steep rise in oil prices over the past twelve months.
Within financial services, the Fund's holding in CONSECO hurt performance.
CONSECO announced weaker-than-expected earnings after investment losses tripled
over the period and expenses grew significantly. TALBOTS (a specialty retailer,
cataloger and e-tailor of apparel for women) reported a decline in store sales
- -- this had the most negative impact on the portfolio.
OUTLOOK
We believe that U.S. economic growth will continue along at a slower rate well
into next year, reflecting a rise in the household savings rate and a moderation
in retail sales growth. This slowdown should limit inflation risk. The housing
market continues to be a concern, with the number of new starts declining and
the inventory of unsold homes growing. The impact of this slowdown, combined
with high oil and gas prices, threatens consumer spending, especially with
savings ratios already at historically low levels. Although consumers have so
far remained resilient, we believe that they will eventually cut back on
discretionary spending. Corporate balance sheets, however, are on the whole
quite healthy -- profits are good and companies are increasingly focused on
generating returns for shareholders.
We believe that our fundamental-based research process will continue to be able
to identify stocks selling at discounts to their fair values in what we believe
has become a stockpicker's market -- a market that we believe will not
necessarily reward broad ownership of sectors or industries, but rather
individual securities.
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7
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SCHRODER U.S. OPPORTUNITIES FUND
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COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER U.S. OPPORTUNITIES FUND -- INVESTOR OR ADVISOR SHARES
VS. THE RUSSELL 2000 INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder U.S. Schroder U.S.
Opportunities Fund, Opportunities Fund,
Investor Shares Advisor Shares Russell 2000 Index
10/31/97 $10,000 $10,000 $10,000
10/31/98 8,406 8,382 8,816
10/31/99 9,155 9,109 10,127
10/31/00 12,884 12,787 11,890
10/31/01 13,310 13,176 10,380
10/31/02 11,991 11,841 9,179
10/31/03 15,844 15,605 13,159
10/31/04 19,173 18,835 14,703
10/31/05 21,332 20,903 16,479
10/31/06 25,954 25,385 19,771
10/31/07 31,150 30,401 21,604
The Russell 2000 Index is a market capitalization weighted broad based index of
2,000 small capitalization U.S. companies.
PERFORMANCE INFORMATION
One Year Ended Five Years Ended Ten Years Ended
October 31, 2007 October 31, 2007 October 31, 2007
---------------- ---------------- ----------------
Schroder U.S. Opportunities Fund (a)(b) --
Investor Shares .......................... 20.02% 21.04%(c) 12.03%(c)
Advisor Shares ........................... 19.76% 20.76%(c)(d) 11.76%(c)(d)
(a) The portfolio manager primarily responsible for making investment decisions
for the Fund assumed this responsibility effective January 2, 2003. The
performance results for periods prior to January 2, 2003 were achieved by the
Fund under a different portfolio manager.
(b) Effective May 1, 2006, the combined advisory and administrative fees of the
Fund increased to 1.00% per annum. If the Fund had paid such higher fees during
prior periods, the returns of the Fund would have been lower.
(c) Average annual total return.
(d) The Advisor Shares commenced operations on May 15, 2006. The performance
information provided in the line graph and the performance information table for
periods prior to May 15, 2006 reflects the performance of the Investor Shares of
the Fund, adjusted to reflect the distribution fees paid by Advisor Shares.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND/OR REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY* % OF INVESTMENTS
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Dresser-Rand Group 1.9%
Scientific Games Class A 1.7
Reinsurance Group of America 1.5
Perrigo 1.5
Informatia 1.5
* Excludes any Short-Term Investments.
SECTOR ALLOCATION
SECTOR % OF INVESTMENTS
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Technology 14.7%
Financial Services 14.5
Health Care 14.4
Consumer Discretionary 14.1
Other Energy 9.0
Materials & Processing 8.2
Producer Durables 6.8
Utilities 4.0
Autos & Transportation 2.4
Consumer Staples 0.2
Short-Term Investment 11.7
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8
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SCHRODER U.S. SMALL AND MID CAP OPPORTUNITIES FUND
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MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
In the 12 months ended October 31, 2007, the Schroder U.S. Small and Mid Cap
Opportunities Fund (the "Fund") rose 22.60% (Investor Shares) and 22.48%
(Advisor Shares), compared to the Russell 2500 Index (the "Index"), a
broad-based basket of stocks with characteristics similar to the Fund's
portfolio, which rose 12.71%.
MARKET BACKGROUND
Overall, U.S. small and mid cap stocks performed strongly during the one-year
period under review. Volatility in the U.S. market continued during the third
quarter from the sharp correction in August while the Federal Reserve reduced
interest rates 0.75% over the year to 4.50% as of the end of October. Despite
the market turmoil around the subprime mortgage crisis and housing market
correction that took hold in August, overall economic and market conditions --
such as robust growth over the past two quarters in the U.S. economy -- were
favorable for investors.
PORTFOLIO REVIEW
During the period under review, the Fund benefited from particularly good stock
selection in the materials and processing, financial services and energy
sectors. The Fund's holdings in the producer durables and consumer staples
sectors detracted the most from relative performance.
At the stock level, the most positive contributor was DRESSER-RAND GROUP (a
manufacturer of equipment solutions to the oil and gas industries), which
consistently beat Wall Street's earnings estimates. Rising margins and high
demand for rotating equipment, after-market parts and services has been driving
up the stock price over the twelve-month period.
The most significant detractors were TALBOTS (a specialty retailer, cataloger
and e-tailor of apparel for women.), which declined due to a drop in store
sales, and ADVANCED MEDICAL OPTICS (develops and manufactures medical devices
for the eye), which weakened when the company recalled its contact lens care
solution product.
OUTLOOK
We believe that U.S. economic growth will continue along at a slower rate well
into next year, reflecting a rise in the household savings rate and a moderation
in retail sales growth. This slowdown should limit inflation risk. The housing
market continues to be a concern, with the number of new starts declining and
the inventory of unsold homes growing. The impact of this slowdown, combined
with high oil and gas prices, threatens consumer spending, especially with
savings ratios already at historically low levels. Although consumers have so
far remained resilient, we believe that they will eventually cut back on
discretionary spending. Corporate balance sheets, however, are on the whole
quite healthy -- profits are good and companies are increasingly focused on
generating returns for shareholders.
We believe that our fundamental-based research process will continue to identify
stocks selling at discounts to their fair values in what we believe has become a
stockpicker's market -- a market that will not likely reward broad ownership of
sectors or industries, but rather individual securities.
- --------------------------------------------------------------------------------
9
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALL AND MID CAP OPPORTUNITIES FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER U.S. SMALL AND MID CAP OPPORTUNITIES FUND -- INVESTOR OR ADVISOR
SHARES VS. THE RUSSELL 2500 INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder U.S. Schroder U.S.
Small and Mid Cap Small and Mid Cap
Opportunities Fund, Opportunities Fund,
Investor Shares Advisor Shares Russell 2500 Index
3/31/06 $10,000 $10,000 $10,000
10/31/06 10,250 10,230 10,077
10/31/07 12,567 12,530 11,357
The Russell 2500 Index is a market capitalization weighted broad based index
measuring the performance of the 2500 smallest companies in the Russell 3000
Index, which represents approximately 20% of the total market capitalization of
the Russell 3000 Index.
PERFORMANCE INFORMATION
One Year Annualized
Ended Since
October 31, 2007 Inception(a)
---------------- ------------
Schroder U.S. Small and Mid Cap Opportunities Fund --
Investor Shares .................................. 22.60% 15.52%
Advisor Shares ................................... 22.48% 15.31%
(a) From commencement of Fund operations on March 31, 2006.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY* % OF INVESTMENTS
- --------------------------------------------------------------------------------
Dresser-Rand Group 2.8%
DaVita 2.6
Barr Pharmaceuticals 2.6
Amdocs 2.5
VeriSign 2.5
* Excludes any Short-Term Investments.
SECTOR ALLOCATION
SECTOR % OF INVESTMENTS
- --------------------------------------------------------------------------------
Technology 16.1%
Consumer Discretionary 14.6
Financial Services 14.5
Materials & Processing 13.7
Health Care 13.6
Other Energy 8.6
Producer Durables 5.1
Utilities 4.5
Consumer Staples 0.5
Autos & Transportation 0.4
Short-Term Investment 8.4
- --------------------------------------------------------------------------------
10
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL ALPHA FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
In the fiscal year ended October 31, 2007, the Schroder International Alpha Fund
("the Fund") rose 27.38% (Investor Shares) and 26.92% (Advisor Shares), compared
to the Morgan Stanley Capital International EAFE Index (the "Index"), a
broad-based basket of international stocks, which rose 24.92%.
During the period, the energy, industrial, telecommunication and consumer staple
sectors contributed the most to the Fund's returns. The Fund's holdings in
emerging markets and Canada added most value from a regional perspective, while
the Fund also benefited from its underweight in Japan. Continental Europe and
the financials sector, meanwhile, detracted most from performance.
MARKET BACKGROUND
International equity markets moved higher over the past year. Volatility
increased, however, as a result of concerns over the U.S. subprime segment, the
potential impact on global liquidity and the possible slowdown in the U.S.
economy. Liquidity flows and corporate activity were in abundance for the
majority of the period, however, at least until the summer when the seriousness
of the U.S. subprime fallout began to emerge. Market sentiment improved somewhat
as the period drew to a close amidst hopes that the Federal Reserve (the "Fed")
would reduce interest rates to avoid a recession. Emerging economies
demonstrated resilience to problems affecting the U.S., and companies --
especially in Asia -- benefited from improving domestic consumption and
government spending. Other dominant themes during the period included rising
commodity prices and a weakening U.S. dollar.
PORTFOLIO REVIEW
From a regional perspective, the Fund's holdings in emerging markets and Canada
and its underweight in Japan contributed significantly to outperformance of the
Index. By sector, the Fund's holdings in telecommunications (especially emerging
market stocks such as CHINA UNICOM and AMERICA MOVIL), energy (including BG
GROUP, VENTURE PRODUCTION and Canadian firms NIKO RESOURCES and SUNCOR),
industrial (such as DAEWOO SHIPBUILDING & MARINE ENGINEERING) and consumer
staples (including SABMILLER and TESCO) contributed strongly to performance.
U.K. mining company RIO TINTO also performed well, having benefited from strong
global demand for copper and iron ore. Another global theme that supported Fund
returns involved China's growth story. DONGFENG MOTOR GROUP, INDUSTRIAL &
COMMERCIAL BANK OF CHINA and GOLDEN EAGLE RETAIL GROUP are examples of companies
that gained on investor-and consumer-led demand.
Holdings in the financials sector detracted the most from performance. U.K.
mortgage lender NORTHERN ROCK was a casualty of the worldwide "credit crunch" as
its business model suffered from the effective closing down of the inter-bank
lending market. Japanese banks such as ORIX and SUMITOMO MITSUI FINANCIAL GROUP
also underperformed, partly due to exposure to U.S. subprime-related losses and
also from stubbornly sluggish loan growth in Japan. Department store group
TAKASHIMAYA suffered a similar fate as Japanese consumer spending failed to
improve in the period.
OUTLOOK
We believe that U.S. economic growth will continue to slow -- likely more than
initially predicted -- but that the U.S. economy will avoid recession. While the
Fed's rate-setting committee says that it sees rising inflation as being as much
of a threat as slowing economic growth, the vice-chairman of the Fed
subsequently hinted that further rate reductions might be necessary. We believe
that inflation should return to target levels in the medium term with the impact
of moderating growth eventually filtering through to the rest of the economy.
At the same time, central banks elsewhere are evaluating inflation pressures,
with growth in European and Asian economies still quite robust. Employment
continues to fall in Germany, for instance. Despite short-term inflation
pressure in the UK, the Bank of England recently gave a strong indication that
it plans to cut interest rates in 2008.
In Asia, barring export-driven economies such as Taiwan, demand is coming mainly
from domestic sources. Economic growth, therefore, should be less affected by a
slowdown in the U.S. economy -- the only question here is the extent of this
decoupling from the U.S. We believe that China and India will continue to
benefit from trends in urbanization and increased domestic wealth as well as
infrastructure spending on such projects as roads, rail networks, water and
waste treatment facilities and power generation plants.
- --------------------------------------------------------------------------------
11
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL ALPHA FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
We also believe that climate change will play an important role not just in the
coming year but for decades to come. It is now widely accepted that mitigating
and solving the global warming crisis is not simply a matter of building a few
windfarms. Rather, a worldwide transformation in the way people conduct their
daily lives and businesses run their operations is needed. Companies that either
help mitigate the impact of climate change or help adapt to changes that are
already potentially inevitable should be increasingly rewarded in the market.
Examples within the Fund include companies that stand to benefit from greater
demand for hybrid-powered cars, renewable energy sources and ways to improve
crop yields.
Above all, we continue to invest in what we believe are high-quality growth
companies that we consider undervalued by the market and demonstrate strong
competitive advantages. We believe that this disciplined philosophy will
continue to reward the Fund's investors.
- --------------------------------------------------------------------------------
12
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL ALPHA FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER INTERNATIONAL ALPHA FUND -- INVESTOR OR ADVISOR SHARES
VS. THE MORGAN STANLEY CAPITAL INTERNATIONAL (MSCI) EAFE INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Schroder
International International
Alpha Fund, Alpha Fund,
Investor Shares Advisor Shares MSCI EAFE Index
10/31/97 $10,000 $10,000 $10,000
10/31/98 10,382 10,356 10,964
10/31/99 12,647 12,587 13,489
10/31/00 13,662 13,560 13,098
10/31/01 10,252 10,149 9,833
10/31/02 8,488 8,388 8,534
10/31/03 10,412 10,259 10,840
10/31/04 11,798 11,600 12,883
10/31/05 14,092 13,814 15,213
10/31/06 18,300 17,917 19,400
10/31/07 23,311 22,741 24,234
The MSCI EAFE Index is a market weighted index composed of companies
representative of the market structure of certain developed market countries in
Europe, Australia, Asia and the Far East, and reflects dividends reinvested net
of non-recoverable withholding tax.
PERFORMANCE INFORMATION
One Year Ended Five Years Ended Ten Years Ended
October 31, 2007 October 31, 2007 October 31, 2007
---------------- ---------------- ----------------
Schroder International Alpha Fund (a) --
Investor Shares ......................... 27.38% 22.39%(b) 8.83%(b)
Advisor Shares .......................... 26.92% 22.08%(b)(c) 8.56%(b)(c)
(a) Effective April 1, 2006, the combined advisory and administrative fees of
the Fund increased to 0.975% per annum. If the Fund had paid such higher fees
during prior periods, the returns of the Fund would have been lower.
(b) Average annual total return.
(c) The Advisor Shares commenced operations on May 15, 2006. The performance
information provided in the line graph and the performance information table for
periods prior to May 15, 2006 reflects the performance of the Investor Shares of
the Fund, adjusted to reflect the distribution fees paid by Advisor Shares.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY % OF INVESTMENTS
- --------------------------------------------------------------------------------
Rio Tinto 3.4%
BG Group 2.9
Nestle 2.8
Siemens 2.8
Groupe Danone 2.7
GEOGRAPHIC ALLOCATION
- --------------------------------------------------------------------------------
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
% of investments
Continental Europe 36.4%
United Kingdom 25.7
Japan 12.4
Pacific ex-Japan 12.2
Emerging Markets 9.3
North America 3.5
Short-Term Investment 0.5
- --------------------------------------------------------------------------------
13
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKET EQUITY FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
In the 12 months ended October 31, 2007, the Schroder Emerging Market Equity
Fund ("the Fund") rose 70.50% (Investor Shares) and 70.09% (Advisor Shares),
compared to the Morgan Stanley Capital International Emerging Markets Index (the
"Index"), a broad-based basket of international stocks, which rose 67.83% during
the same period.
MARKET BACKGROUND
Global emerging equity markets delivered excellent returns over the period
although market conditions were volatile. For most of the period, generally
buoyant investor confidence and continued evidence of strong economic growth in
many of these countries supported performance. Emerging markets did, however,
experience a sharp correction at the end of February/early March against a
background of a broad sell-off in global equity markets. Emerging markets then
rallied strongly over the next few months as investor sentiment improved. At the
end of July and into August these markets again fell sharply due to investor
concerns about problems in the U.S. housing and credit markets and their
potential effect on the global economy. This was followed by interest rate
reductions from the U.S. Federal Reserve, helping investor confidence to recover
to some extent, and emerging markets rallied (although there was further
volatility towards the end of the period).
Peru delivered the strongest returns, with this commodity-related market gaining
from the strength of copper and gold prices. Brazil also delivered very strong
returns, with the market benefiting from strong investor interest, while the
country's central bank continued its monetary easing policy. Elsewhere in Latin
America, the Argentine and Mexican markets made good progress in absolute terms,
although performance was significantly behind the Index. Energy shortages and
inflation in Argentina weighed on investors' minds, while in Mexico the central
bank raised interest rates. Mexico is also perceived to be particularly
vulnerable to any marked slowdown in the U.S.
In Asia, China delivered the best returns and was also among the strongest
performing global emerging markets. The relaxation of regulations allowing
mainland investors to buy Hong Kong-listed shares helped to boost the MSCI China
Index. Furthermore, the Chinese economy continues to grow at a rapid rate
despite monetary tightening. Indian and Indonesian markets also outperformed the
Index by a considerable margin, with the Indian economy enjoying strong growth.
The Taiwanese market made good progress in absolute terms, although it was
significantly behind the Index. This market remains particularly vulnerable to a
sharp slowdown in the U.S. economy.
Turkey was the best performer among the Europe, Middle East and Africa ("EMEA")
markets. The country's central bank surprised investors with an interest rate
reduction and, with real rates at a high level, more cuts are expected. Domestic
political developments were also broadly positive. The Czech market also
outperformed the Index. Russia made strong progress in absolute terms but
returns trailed the Index. This was largely due to underperformance in the
energy sector. Domestic economic growth, however, remains robust.
PORTFOLIO REVIEW
The Fund outperformed its benchmark Index during the one year under review. The
Fund's country allocation and stock selection were both positive. The Fund's
overweight position to Brazil and its underweight position in Mexico added the
most value. This was partially offset by an overweight to Russia and country
allocation to Thailand, which were the largest negative contributors to
performance. The cash position in the Fund also detracted from returns. Stock
selection in China, Brazil, Argentina and South Africa added the most value.
This was partially offset by stock selection in India, Korea and Turkey which
detracted somewhat from performance.
Brazil is the Fund's largest overweight as compared to the Index due to what we
believe are reasonable valuations, strong economic growth and robust company
earnings. The Fund is also overweight Thailand, due to an improving economic
outlook and attractive valuations. Russia remains the largest overweight market
in the EMEA region. The economy continues to perform strongly and valuations are
attractive. The Fund is also overweight Turkey. India and Mexico are the Fund's
largest underweight positions. Although the Indian economy is strong we believe
that the market is too expensive. In Mexico the economic outlook is uncertain
and sensitivity to a slowdown in the U.S. is high. The Fund also remains
underweight Israel as compared to the Index.
- --------------------------------------------------------------------------------
14
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKET EQUITY FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
OUTLOOK
We believe that the long-term outlook for global emerging markets remains
positive. Emerging market growth is holding up well despite slowing growth for
the global economy. Emerging markets should be able to sustain high growth rates
due to stronger intra-regional trade and increasing domestic demand against a
backdrop of huge structural improvements. We believe that emerging markets are
likely to continue delivering growth well above developed markets. However, in
the near term the Fund will maintain a moderately cautious stance. Although the
emerging economies have decoupled from the U.S. to some extent, they still
remain vulnerable to a global recession and the outlook for global emerging
markets would be upset if sentiment shifts towards a hard landing view on the
U.S. economy. We believe that emerging markets are now fully valued and, given
the likelihood of further interest rate cuts in the U.S., are likely to be
driven by liquidity and momentum rather than fundamentals in the near term. This
is most evident in markets such as China and India.
We expect to maintain the Fund's basic approach of investing across a wide
spectrum of countries and stocks, providing investors with a diversified
exposure to global emerging markets, gaining returns from both country and stock
selection in a low volatility, risk controlled manner. We are confident that
this approach can pay off as we believe that emerging market economies will
continue to offer premium growh rates compared to the developed world.
- --------------------------------------------------------------------------------
15
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKET EQUITY FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER EMERGING MARKET EQUITY FUND -- INVESTOR OR ADVISOR SHARES
VS. THE MORGAN STANLEY CAPITAL INTERNATIONAL (MSCI) EMERGING MARKETS INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Emerging Schroder Emerging
Market Equity Fund, Market Equity Fund, MSCI Emerging
Investor Shares Advisor Shares Markets Index
3/31/06 $10,000 $10,000 $10,000
10/31/07 10,549 10,531 10,510
10/31/07 17,986 17,912 17,639
The MSCI Emerging Markets Index is an unmanaged market capitalization index of
companies representative of the market structure of emerging countries in
Europe, the Middle East, Africa, Latin America and Asia. The Index reflects
actual buyable opportunities for the non-domestic investor by taking into
account local market restrictions on share ownership by foreigners.
PERFORMANCE INFORMATION
One Year Annualized
Ended Since
October 31, 2007 Inception(a)
---------------- ------------
Schroder Emerging Market Equity Fund --
Investor Shares ........................... 70.50% 44.89%
Advisor Shares ............................ 70.09% 44.50%
(a) From commencement of Fund operations on March 31, 2006.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY* % OF INVESTMENTS
- --------------------------------------------------------------------------------
China Mobile 4.1%
OAO Gazprom ADR 4.1
CNOOC 3.4
Cia Vale do Rio Doce ADR 2.8
Petroleo Brasileiro ADR 2.3
* Excludes any Short-Term Investments.
GEOGRAPHIC ALLOCATION
- --------------------------------------------------------------------------------
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
% of Investments
Asia/Far East 55.3%
Latin America 15.9
Europe 15.0
Africa 7.5
Mid-East 3.0
North America 0.6
Short-Term Investment 2.7
- --------------------------------------------------------------------------------
16
- --------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
During the 12 months ended October 31, 2007, the Schroder Enhanced Income Fund
("the Fund") rose 3.37% (Investor Shares) and 3.11% (Advisor Shares), compared
to the LIBOR 3-Month USD Fixed Index (the "Index"), a widely used measure of
short-term debt returns, which rose 5.33%.
Widening asset-backed and mortgage-backed securities ("ABS" and "MBS") spreads
dominated portfolio returns during the 12-month reporting period. The Fund was
not directly impacted by the near collapse of several mortgage hedge funds in
mid-June but overall performance trailed the Index during the reporting period,
primarily due to spread widening in the MBS and ABS space and, to a lesser
extent, the high level of cash yielding below LIBOR.
MARKET BACKGROUND
In the past 12 months, the broad U.S. bond market (up 5.38%, as measured by the
Lehman U.S. Aggregate Bond Index) under-performed the stock market (up 14.56%,
as measured by the S&P 500 Index). The bond market remained steady for the first
six months of the year as the Federal Reserve (the "Fed") held the Fed funds
rate constant at 5.25%. Economic news was mixed over the period and the market
responded daily to updates. The second half of the year, however, brought with
it the subprime market crisis, the credit crunch and an unprecedented level of
volatility to the markets. Bond markets were seriously rattled by
housing-related problems and widespread risk reductions as the U.S. home lending
market distress accelerated sharply in July. Risk aversion became the theme of
the rest of the period under review as the fear of rising defaults caused
liquidity for subprime ABS to dry up while at the same time investors leaving
the asset class forced liquidations and put further downward pressure on prices.
The Fed responded with two interest rate cuts, bringing the Fed funds rate to
4.50%, where it remains as of this writing.
PORTFOLIO REVIEW
Overall performance trailed the Index during the one-year reporting period. In
the fourth quarter of 2006, as our concerns over the U.S. housing market
increased, we reduced our exposure in the credit sector. Our remaining holdings
suffered as market values declined to account for heightened concerns about
credit risks. Portfolio credit quality was upgraded significantly early in 2007
and, because the Fund's evaluation and purchases are based on proprietary credit
research, not external ratings, portfolio credit quality was not materially hurt
by further declines in the market for lower-rated sub-prime securities. Cash and
liquidity was built up in the first part of 2007 through August. The Fund began
reducing cash in September and October by buying the highest rated and most
liquid ABS. Yield spreads over LIBOR for these bonds is currently about 100
basis points compared to 10 to 20 basis points earlier in 2007. The Fed's
interest rate cuts have helped the Fund's performance.
OUTLOOK
The Fund's strategy is squarely centered on security selection within the
highest rated investment areas to provide liquidity and current income
consistent with the preservation of capital. Since we believe that credit and
liquidity curves will steepen, we continue to focus only on the most senior
bonds. We expect the current trend of risk avoidance to continue as investor
focus increasingly shifts from financial liquidity issues to weakness in the
broader economy, maintaining downward pressure on credit and securitized
markets. While we expect some recovery from the very rapid declines of the past
few months, the Fund's near-term strategy is to retain very high liquidity
levels and to opportunistically purchase senior AAA-rated securities when there
are forced sellers in the market.
Recent bank asset write-downs and closures of several large cash funds in Europe
and the U.S. highlight the ongoing environment of risk avoidance and reduced
liquidity, but are positive signs that efforts are being made to recapitalize
and repair balance sheets.
- --------------------------------------------------------------------------------
17
- --------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER ENHANCED INCOME FUND -- INVESTOR OR ADVISOR SHARES
VS. THE LIBOR 3-MONTH USD FIXED INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Enhanced Schroder Enhanced LIBOR
Income Fund, Income Fund, 3-Month USD
Investor Shares Advisor Shares Fixed Index
12/31/04 $10,000 $10,000 $10,000
10/31/05 10,218 10,197 10,288
10/31/06 10,696 10,645 10,809
10/31/07 11,057 10,976 11,385
The LIBOR 3-Month USD Fixed Index is a broad-based basket of U.S. debt
securities.
PERFORMANCE INFORMATION
One Year Annualized
Ended Since
October 31, 2007 Inception (a)
---------------- -------------
Schroder Enhanced Income Fund --
Investor Shares ........................... 3.37% 3.61%
Advisor Shares ............................ 3.11% 3.34%
(a) From commencement of Fund operations on December 31, 2004.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY % OF INVESTMENTS
- --------------------------------------------------------------------------------
Citigroup Funding 4.981%, 11/13/07 4.8%
Bank of America 4.790%, 11/19/07 4.8
Barclays Capital 5.149%, 11/28/07 4.8
Toyota Motor Credit 4.630%, 11/15/07 4.4
General Electric Capital 4.709%, 12/12/07 4.4
SECTOR ALLOCATION
SECTOR % OF INVESTMENTS
- --------------------------------------------------------------------------------
Collateralized Mortgage Obligations 37.4%
Commercial Paper 26.7
Mortgage-Backed Obligations 17.7
U.S. Government Mortgage-
Backed Obligations 14.9
Asset-Backed Securities 2.6
Corporate Obligations 0.2
Short-Term Investment 0.5
- --------------------------------------------------------------------------------
18
- --------------------------------------------------------------------------------
SCHRODER STRATEGIC BOND FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
During the 12 months ended October 31, 2007, the Schroder Strategic Bond Fund
("the Fund") rose 4.13% (Investor Shares) and 3.98% (Advisor Shares), compared
to the Lehman U.S. Aggregate Bond Index (the "Index"), a broad-based basket of
U.S. debt securities, which rose 5.38%. As a further measure of comparison, the
LIBOR 3-Month USD Fixed Index, a widely used measure of short-term debt returns,
rose 5.33%.
MARKET BACKGROUND
One of the best-performing sectors in fixed income during the first six months
under review was high yield -- investors continued to seek ways to maximize
their returns and were given confidence to buy this asset class by the very
supportive economic environment. However, returns on government bonds and
investment grade corporate securities came under pressure from rising interest
rates and accelerating inflation. Bonds that offered investors enhanced
coupon-payment protection, such as mortgage-backed securities ("MBS") or
asset-backed securities, performed better in this environment. Before the
eruption of volatility prompted by the collapse in the subprime sector of the
U.S. housing market, the outlook for global fixed income markets was centered on
the stretched valuations in the credit markets and the low levels of yields
within the global government bond sector. However, this view was destroyed as
the subprime mortgage situation in the U.S. progressed -- mortgage rates rose,
liquidity was withdrawn and housing prices declined.
As the period under review progressed, debt markets seesawed as the market's
outlook for the global economy swung from hope to gloom. The U.S. Federal
Reserve (the "Fed") cut interest rates by an exceptional 50 basis points at the
end of September and bond markets fell back over the next couple of weeks as
investors scaled down their concerns about the credit crisis and moved back into
riskier asset classes. However, by mid-October worries about banks' exposure to
risky investments were revived. The U.S.'s largest bank, Citigroup, announced a
big decline in profits and huge write-downs linked to areas such as subprime
mortgages and leveraged loans. This was enough to spark a new rally in
government markets and a sell-off in credit markets. The trend intensified as
other leading U.S. banks also announced bleak earnings statements. The Fed then
cut interest rates by another quarter point on the last day of October.
PORTFOLIO REVIEW
During the one-year period under review the Fund maintained a predominantly
defensive duration position. The robust growth environment and potential for
increased inflationary pressures prompted a low level of interest rate risk in
the Fund. The Fund had a relatively high allocation to U.S. MBS, made in line
with our policy of generating excess return through investment in high quality
instruments offering incremental return. As we held a negative view on the
direction of yields, we increased the allocation to MBS and, by early June, held
a defensive U.S. Treasury position. In effect, the Fund was long MBS and short
U.S. Treasury bonds. The short duration component was a positive contributor to
performance until yields fell sharply in July and over the one-year period under
review ultimately detracted from returns.
The Fund's position in the U.S. was countered by a long position in Japanese
government bonds. This position positively contributed to performance. Other
positive contributors to performance over the period were the Fund's long
duration position to Eurozone government bonds.
OUTLOOK
The volatility that has characterized bond markets during recent months is
likely to persist in the near term as investors remain wary of the ultimate
impact of subprime issues. In this environment we remain cautious on credit
exposure and continue to position the portfolio for a slowing global economy.
From a macro level, the Fund's strategy is focused on government duration at the
front end of global yield curves.
We believe that the Fund's benchmark-agnostic, total return investment approach
will allow us to focus on flexible, best-ideas investment in a broad geographic
range of markets and sectors. When combined with a risk management mentality
that diversifies investments across a range of strategies, we believe that the
Fund is positioned to perform well in the current economic environment.
- --------------------------------------------------------------------------------
19
- --------------------------------------------------------------------------------
SCHRODER STRATEGIC BOND FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER STRATEGIC BOND FUND -- INVESTOR OR ADVISOR SHARES
VS. THE LEHMAN U.S. AGGREGATE BOND INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Strategic Schroder Strategic Lehman U.S.
Bond Fund, Bond Fund, Aggregate
Investor Shares Advisor Shares Bond Index
6/30/06 $10,000 $10,000 $10,000
10/31/06 10,127 10,111 10,449
10/31/07 10,546 10,514 11,011
The Lehman U.S. Aggregate Bond Index comprises government securities,
mortgage-backed securities, asset-backed securities and corporate securities to
simulate the universe of bonds in the market.
PERFORMANCE INFORMATION
One Year Annualized
Ended Since
October 31, 2007 Inception (a)
---------------- -------------
Schroder Strategic Bond Fund --
Investor Shares .......................... 4.13% 4.07%
Advisor Shares ........................... 3.98% 3.83%
(a) From commencement of Fund operations on June 30, 2006.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY* % OF INVESTMENTS
- --------------------------------------------------------------------------------
U.S. Treasury Bond 5.125%, 5/15/16 11.3%
FNMA TBA 5.000%, 11/25/22 6.2
FNMA 5.000%, 1/01/22 6.1
FHLMC Gold 5.000%, 5/01/37 5.3
U.S. Treasury Note 4.625%, 7/31/12 5.1
SECTOR ALLOCATION
SECTOR % OF INVESTMENTS
- --------------------------------------------------------------------------------
Commercial Paper 22.6%
U.S. Government Mortgage-
Backed Obligations 20.1
U.S. Treasury Obligations 18.0
Foreign Bonds 14.3
Corporate Obligations 7.2
Mortgage-Backed Obligations 5.4
Collateralized Mortgage Obligations 0.4
Short-Term Investment 12.0
* Excludes any Short-Term Investments.
- --------------------------------------------------------------------------------
20
- --------------------------------------------------------------------------------
SCHRODER TOTAL RETURN FIXED INCOME FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
During the 12 months ended October 31, 2007, the Schroder Total Return Fixed
Income Fund ("the Fund") rose 4.90% (Investor Shares) and 4.53% (Advisor
Shares), compared to the Lehman U.S. Aggregate Bond Index (the "Index"), a
broad-based basket of U.S. debt securities, which rose 5.38%.
Overall performance trailed the Index during the 12-month reporting period due
to the Fund's short duration position relative to the Index, which held back
returns as bond prices rose. The Fund's less-than-benchmark exposure to
corporate bonds helped performance at the beginning of the review period as risk
aversion in the markets spiked considerably. The Fund's strategy of owning fewer
Treasuries in favor of both residential and commercial mortgage-backed
securities helped boost performance. The Fund's overweight position in corporate
sectors that did well and underweight position in those that did poorly also
helped to drive performance, as did the Fund's exposure to the yield curve
during a period of yield curve steepening.
MARKET BACKGROUND
In the past 12 months, the broad U.S. bond market (up 5.38%, as measured by the
Lehman U.S. Aggregate Bond Index) under-performed the stock market (up 14.56%,
as measured by the S&P 500 Index). The bond market remained steady for the first
six months of the year as the Federal Reserve (the "Fed") held the Fed funds
rate constant at 5.25%. Economic news was mixed over the period and the market
responded daily to updates. Bond investors pulled back from riskier parts of the
market and demanded greater compensation via wider yield spreads, despite
continued risk taking as evident by high mergers and acquisitions levels. The
second half of the year, however, brought with it the subprime market crisis,
the credit crunch and an unprecedented level of volatility to the markets. Bond
markets were seriously rattled by housing-related problems and widespread risk
reductions as the U.S. home lending market distress accelerated sharply in July.
Risk aversion become the theme of the rest of the period under review as the
fear of rising defaults caused liquidity for subprime ABS to dry up while at the
same time investors leaving the asset class forced liquidations and put further
downward pressure on prices. The Fed responded with two interest rate cuts,
bringing the Fed funds rate to 4.50%, where it remains as of this writing.
PORTFOLIO REVIEW
In the first six months of the year the Fund outperformed the Index by
maintaining a neutral duration stance (that is to say, the Fund's portfolio was
roughly equally sensitive to interest rate changes as the Index), while reducing
risk to preserve gains from an overweight to corporate bonds toward the end of
2006. Importantly, much of the corporate reductions came from cutting lower
rated (BBB and high yield) issuers prior to the spike in risk aversion and
accompanying spread widening towards the end of February. In the last six months
of the reporting period the Fund underperformed the Index. The primary positive
contributor to performance was the Fund's exposure to the steepening yield
curve, with an overweight to the five-year maturity area and an underweight to
30-year maturities. Performance was brought down, however, by a large
underweight in agency debentures and security selection within corporates,
particularly in the financials sector.
OUTLOOK
We expect the current trend of risk avoidance to continue as investor focus
increasingly shifts from financial liquidity issues to weakness in the broader
economy, maintaining downward pressure on credit markets. We believe that
consumer spending will decelerate markedly in conjunction with weakening housing
data showing that home prices have indeed decoupled from income. In the
corporate sector, particularly in financials, the fall in earnings estimates
leads us to believe that the credit issues have not abated and therefore expect
additional repricing of risky assets as leverage unwinds.
We therefore maintain our conservative strategic view and expect the Fund to
maintain its defensive posture and further reduce credit exposure, particularly
in financials, during any bouts of strength and liquidity. We do, however,
believe the velocity at which the yield curve has steepened appears to have gone
to far and have booked profits on our overweight to 5-year maturities and
underweight to 30-year Treasuries.
- --------------------------------------------------------------------------------
21
- --------------------------------------------------------------------------------
SCHRODER TOTAL RETURN FIXED INCOME FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER TOTAL RETURN FIXED INCOME FUND -- INVESTOR OR ADVISOR SHARES
VS. THE LEHMAN U.S. AGGREGATE BOND INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Total Return Schroder Total Return Lehman U.S.
Fixed Income Fund, Fixed Income Fund, Aggregate
Investor Shares Advisor Shares Bond Index
12/31/04 $10,000 $10,000 $10,000
10/31/05 10,150 10,130 10,102
10/31/06 10,648 10,592 10,627
10/31/07 11,170 11,072 11,198
The Lehman U.S. Aggregate Bond Index is a widely used measure of short-term debt
returns. It is not managed.
PERFORMANCE INFORMATION
One Year Annualized
Ended Since
October 31, 2007 Inception (a)
---------------- -------------
Schroder Total Return Fixed Income Fund --
Investor Shares .......................... 4.90% 3.98%
Advisor Shares ........................... 4.53% 3.66%
(a) From commencement of Fund operations on December 31, 2004.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 5 HOLDINGS
SECURITY % OF INVESTMENTS
- --------------------------------------------------------------------------------
U.S. Treasury Note 4.000%, 8/31/09 9.3%
U.S. Treasury Note 4.250%, 9/30/12 6.6
GNMA 6.000%, 9/20/37 5.2
Deutsche Bank 4.790%, 11/01/07 4.6
Barcalys Capital 5.149%, 11/28/07 3.9
SECTOR ALLOCATION
SECTOR % OF INVESTMENTS
- --------------------------------------------------------------------------------
U.S. Government Mortgage-
Backed Obligations 25.8%
U.S. Treasury Obligations 20.3
Commercial Paper 17.6
Corporate Obligations 14.8
Collateralized Mortgage Obligations 12.1
Mortgage-Backed Obligations 7.0
Asset-Backed Securities 0.2
Short-Term Investment 2.2
- --------------------------------------------------------------------------------
22
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
PERFORMANCE
In the 12 months ended October 31, 2007, the Schroder Municipal Bond Fund (the
"Fund") rose 2.45% (Investor Shares) and 2.19% (Advisor Shares), compared to the
Lehman 5-Year Municipal Bond Index (the "Index"), a broad-based basket of
intermediate-term municipal debt securities, which rose 3.78%. Because of the
relative price underperformance of the shares, the 30-day SEC Yield for the
Fund's Investor Shares rose to 4.16% at year-end (3.91% for Advisor Shares),
well above the Lipper average yield of 3.29% for intermediate municipal debt
funds.
We believe the Fund's underperformance relative to the benchmark can be
attributed to three things. First, the benchmark consists of maturities in the
four- to six-year range. This was the strongest performing part of the yield
curve during the third quarter. Since the Fund consists of securities with
maturities across the yield curve, performance was not in line with the Index.
Second, the Fund suffered from the markdown of its Radian Assurance insured
issues. Radian is a AA-rated insurer and was twice re-confirmed by Moody's and
S&P, although its exposure to corporate and mortgage guarantees has left
investors concerned about its credit rating. The third driver of performance has
been the purchase of Percent of LIBOR notes (PLNs). These bonds were marked down
in the third quarter due to the involvement of Merrill Lynch, Citibank, and JP
Morgan, who act as counterparties on the energy contracts. All of these issuers
carry AA ratings. As these companies disclosed write-downs associated with
asset-backed securities (ABS) and structured investment vehicle (SIV) losses,
however, the PLNs widened out consistently with their corporate debt. We are
optimistic about the future of Merrill Lynch, Citibank, and JP Morgan, and we
believe that these bonds will improve beyond the current period of financial
concerns.
MARKET BACKGROUND
In the one-year period, the broad U.S. bond market (up 5.38%, as measured by the
Lehman U.S. Aggregate Bond Index) under-performed the stock market (up 14.56%,
as measured by the S&P 500 Index). The municipal bond market, meanwhile,
underper-formed the taxable markets. The Lehman Municipal Bond Index (which
contains tax-exempt municipal bonds with maturities across the yield curve)
returned 2.91% for the one-year period while the Lehman U.S. Aggregate Bond
Index (comprised of taxable securities) returned 5.38% for the period.
The bond market remained steady for the first six months of the year as the
Federal Reserve (the "Fed") held the Fed funds rate constant at 5.25%. Economic
news was mixed over the period and the market responded daily to updates. The
second half of the year, however, brought with it the subprime market crisis,
the credit crunch and an unprecedented level of volatility to the markets. The
Fed responded with two interest rate cuts, bringing the Fed funds rate to 4.50%,
where it remains as of this writing.
Over the year, rates across the Treasury curve fell significantly on the short
end and remained fairly constant at the long end. The yield on the 2-year
Treasury fell by 0.71% -- from 4.65% to 3.94% during the reporting period. The
yield on the 10-year Treasury fell by 0.05% from 4.60% to 4.55%. On the long end
of the yield curve, the 30-year Treasury yield increased from 4.71% to 4.75%, or
0.04% during the same time period.
The yield on a 2-year AAA-rated municipal bond fell 0.12% -- from 3.50% to
3.38%. In contrast, the AAA-rated yield on a 30-year municipal bond rose 0.14%
from 4.21% to 4.35%.
PORTFOLIO REVIEW
In the one year under consideration, the Fund underperformed the Index due to
our wide spread of maturities rather than a single, five-year bullet maturity,
the impact of Radian Assurance, and the downward pricing of PLN's. More than 60%
of the municipal bonds brought to market this year were insured. The Fund's
exposure to insured bonds is substantially below that level, however, and is
broadly diversified among insurers.
A good example of the Fund's focus on credit enhancement through selecting
issues we believe to have high credit quality was its purchase of a AAA-rated
TRAVIS COUNTY HEALTH FACILITY DEVELOPMENT tax-exempt bond with an effective
maturity of January 2018 due to a sinking fund schedule. The Fund purchased the
bond at a 4.65% tax-free yield. The bond has been escrowed to maturity and is
backed by U.S. government securities. The tax-free yield on a AAA-rated
municipal bond available in the market on the same day as the TRAVIS COUNTY
purchase was 3.85%, according to the Bloomberg national municipal scale. This is
typical of the bonds the Fund holds -- many are secured by third-party
guarantees through insurance, a corporate guaranty, underlying mortgages, a bank
letter of credit, or secured by U.S. Treasuries or a federal government agency.
- --------------------------------------------------------------------------------
23
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 3, 2007)
One bond that underperformed during the period was OZARK CENTRE, TRANSPORTATION
DEVELOPMENT DISTRICT, a revenue bond backed by transportation sales tax revenue.
The bond has an effective maturity of November 2011.
OUTLOOK
We will continue to stick to our discipline, which seeks to add value through
bottom-up security selection and diversification while seeking to exploit the
inefficiencies in the municipal bond market, which is highly fragmented in
nature and geographically dispersed. Due to these inefficiencies, we have been
able to find what we believe is high relative value in tax-exempt municipals
with high credit quality and expect to continue to invest in these types of
securities while at the same time maintaining duration close to the benchmark.
- --------------------------------------------------------------------------------
24
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER MUNICIPAL BOND FUND -- INVESTOR OR ADVISOR SHARES
VS. THE LEHMAN 5-YEAR MUNICIPAL BOND INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Municipal Schroder Municipal Lehman 5-Year
Bond Fund, Bond Fund, Municipal
Investor Shares Advisor Shares Bond Index
12/31/03 $10,000 $10,000 $10,000
10/31/04 10,353 10,321 10,246
10/31/05 10,575 10,527 10,294
10/31/06 11,142 11,064 10,692
10/31/07 11,415 11,306 11,096
The Lehman 5-Year Municipal Bond Index is a rules-based, market-value-weighted
unmanaged index of debt obligations issued by municipalities with an approximate
maturity of five years.
PERFORMANCE INFORMATION
One Year Ended Annualized
October 31, 2007 Since Inception(a)
---------------- ------------------
Schroder Municipal Bond Fund --
Investor Shares ..................... 2.45% 3.51%
Advisor Shares ...................... 2.19% 3.25%
(a) From commencement of Fund operations on December 31, 2003.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 10 STATES
STATE % OF INVESTMENTS
- --------------------------------------------------------------------------------
Pennsylvania 13.1%
Texas 7.1
California 7.0
Illinois 6.8
Florida 5.9
STATE % OF INVESTMENTS
- --------------------------------------------------------------------------------
Ohio 5.8%
Colorado 5.5
Arizona 5.4
New Jersey 5.1
Missouri 4.6
- --------------------------------------------------------------------------------
25
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 1, 2007)
PERFORMANCE
In the 12 months ended October 31, 2007, the Schroder Short-Term Municipal Bond
Fund (the "Fund") rose 2.96% (Investor Shares) and 2.70% (Advisor Shares),
compared to the Lehman 1-Year Municipal Bond Index (the "Index"), a broad-based
basket of short-term municipal debt securities, which rose 3.82%. Because of the
relative price underperformance of the shares, the 30-day SEC Yield for the
Fund's Investor Shares rose to 4.07% at year-end (3.82% for Advisor Shares),
well above the Lipper average yield of 3.32% for short municipal debt funds.
We believe the Fund's underperformance of its benchmark can be attributed to
several occurrences in the market. First, the Fund suffered from the markdown of
its Radian Assurance insured issues. Radian is a AA-rated security and was twice
re-confirmed by Moody's and S&P, although its exposure to corporate and mortgage
guarantees has left investors concerned about its credit rating. Another driver
of performance has been the purchase of Percent of LIBOR notes (PLNs). These
bonds were marked down in the third quarter due to the involvement of Merrill
Lynch, Citibank, and JP Morgan, who act as counterparties on the energy
contracts. All of these issuers carry AA ratings. As these companies disclosed
write-downs associated with asset-backed securities (ABS) and structured
investment vehicle (SIV) losses, however, the PLNs widened out consistently with
their corporate debt. We are optimistic about the future of Merrill Lynch,
Citibank, and JP Morgan, and we believe that these bonds will improve beyond the
current period of financial concerns.
MARKET BACKGROUND
In the one-year period, the broad U.S. bond market (up 5.38%, as measured by the
Lehman U.S. Aggregate Bond Index) under-performed the stock market (up 14.56%,
as measured by the S&P 500 Index). The municipal bond market, meanwhile,
underper-formed the taxable markets. The Lehman Municipal Bond Index (which
contains tax-exempt municipal bonds with maturities across the yield curve)
returned 2.91% for the one-year period while the Lehman U.S. Aggregate Bond
Index (comprised of taxable securities) returned 5.38% for the period.
The bond market remained steady for the first six months of the year as the
Federal Reserve (the "Fed") held the Fed funds rate constant at 5.25%. Economic
news was mixed over the period and the market responded daily to updates. The
second half of the year, however, brought with it the subprime market crisis,
the credit crunch and an unprecedented level of volatility to the markets. The
Fed responded with two interest rate cuts, bringing the Fed funds rate to 4.50%,
where it remains as of this writing.
Over the year, rates across the Treasury curve fell significantly on the short
end and remained fairly constant at the long end. The yield on the 2-year
Treasury fell by 0.71% -- from 4.65% to 3.94% during the reporting period. The
yield on the 10-year Treasury fell by 0.05% from 4.60% to 4.55%. On the long end
of the yield curve, the 30-year Treasury yield increased from 4.71% to 4.75%, or
0.04% during the same time period.
The yield on a 2-year AAA-rated municipal bond fell 0.12% -- from 3.50% to
3.38%. In contrast, the AAA-rated yield on a 30-year municipal bond rose 0.14%
from 4.21% to 4.35%.
PORTFOLIO REVIEW
In the one-year period ended October 31, 2007, the Fund underperformed the Index
due to the downward pricing of PLNs and the negative impact of Radian Insurance.
More than 60% of the municipal bonds brought to market this year were insured.
The Fund's exposure to insured bonds is substantially below that level, however,
and is broadly diversified among insurers.
A good example of the Fund's focus on credit enhancement through selecting
issues we believe to have high credit quality was its purchase of a AAA-rated
FLORIDA STATE BOARD OF EDUCATION tax-exempt bond with a stated maturity of May
2008. The Fund purchased the bond at a 4.00% tax-free yield. The bond has been
escrowed to maturity and is backed by U.S. government securities. The tax-free
yield on an AAA-rated municipal bond available in the market on the same day as
the Florida purchase was 3.43%, according to the Bloomberg national municipal
scale. This is typical of the bonds the Fund holds -- most are secured by
third-party guarantees through insurance, a corporate guaranty, underlying
mortgages, a bank letter of credit, or secured by U.S. Treasuries or a federal
government agency.
One bond that underperformed during the period was FREEPORT, a tax-exempt
general obligation security with an August 1, 2008, stated maturity. The village
of Freeport, NY, has pledged its full faith and credit to back this bond, and
all taxable property within the village is subject to AD VALOREM taxes without
limitation. This bond is A-rated.
- --------------------------------------------------------------------------------
26
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
MANAGEMENT DISCUSSION AND ANALYSIS (AS OF DECEMBER 1, 2007)
During the year ended October 31, the Fund maintained a duration similar to the
Index's. Return is generated by purchasing higher-yielding municipal securities
that we believe are undervalued. The Fund maintains a diversified maturity
range, which helps limit the effect when any one segment of the yield curve is
hurt by rising rates.
OUTLOOK
We will continue to stick to our discipline, which seeks to add value through
bottom-up security selection and diversification while seeking to exploit the
inefficiencies in the municipal bond market, which is highly fragmented in
nature and geographically dispersed. Due to these inefficiencies, we have been
able to find what we believe is high relative value in tax-exempt municipals
that are pre-funded and collateralized and expect to continue to invest in these
types of securities.
- --------------------------------------------------------------------------------
27
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN THE VALUE OF A $10,000 INVESTMENT IN
THE SCHRODER SHORT-TERM MUNICIPAL BOND FUND -- INVESTOR AND ADVISOR SHARES
VS. THE LEHMAN 1-YEAR MUNICIPAL BOND INDEX.
[THE FOLLOWING TABLE WAS REPRESENTED BY A LINE GRAPH IN THE PRINTED MATERIAL.]
Schroder Short-Term Schroder Short-Term Lehman 1-Year
Municipal Bond Fund, Municipal Bond Fund, Municipal
Investor Shares Advisor Shares Bond Index
12/31/03 $10,000 $10,000 $10,000
10/31/04 10,126 10,105 10,102
10/31/05 10,376 10,328 10,221
10/31/06 10,788 10,711 10,532
10/31/07 11,107 11,000 10,934
The Lehman 1-Year Municipal Bond Index is a rules-based, market-value-weighted
index of debt obligations issued by municipalities with short-term maturities.
PERFORMANCE INFORMATION
One Year Ended Annualized
October 31, 2007 Since Inception(a)
---------------- ------------------
Schroder Short-Term Municipal Bond Fund --
Investor Shares .......................... 2.96% 2.78%
Advisor Shares ........................... 2.70% 2.52%
(a) From commencement of Fund operations on December 31, 2003.
"TOTAL RETURN" IS CALCULATED INCLUDING REINVESTMENT OF ALL DIVIDENDS AND
DISTRIBUTIONS. RESULTS DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER
WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND SHARES. RETURNS FOR
CERTAIN PERIODS REFLECT FEE WAIVERS AND/OR REIMBURSEMENTS IN EFFECT FOR THAT
PERIOD; ABSENT FEE WAIVERS AND REIMBURSEMENTS, PERFORMANCE WOULD HAVE BEEN
LOWER. RESULTS REPRESENT PAST PERFORMANCE AND DO NOT INDICATE FUTURE RESULTS.
THE VALUE OF AN INVESTMENT IN THE FUND AND THE RETURN ON INVESTMENT BOTH WILL
FLUCTUATE AND REDEMPTION PROCEEDS MAY BE HIGHER OR LOWER THAN AN INVESTOR'S
ORIGINAL COST.
TOP 10 STATES
STATE % OF INVESTMENTS
- --------------------------------------------------------------------------------
Pennsylvania 12.1%
Virginia 7.8
Colorado 7.8
New Jersey 7.3
Illinois 6.9
STATE % OF INVESTMENTS
- --------------------------------------------------------------------------------
Kansas 5.4%
Texas 5.2
Arkansas 5.2
Wisconsin 4.4
Missouri 3.6
- --------------------------------------------------------------------------------
28
- --------------------------------------------------------------------------------
SCHRODER NORTH AMERICAN EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
COMMON STOCK - 99.7%
BERMUDA - 1.7%
50,576 Accenture Class A 1,974,993
34,838 ACE 2,111,531
8,800 Allied World Assurance Holdings 421,608
14,934 Arch Capital Group (1) 1,116,615
7,800 Aspen Insurance Holdings 213,408
35,767 Axis Capital Holdings 1,421,381
22,174 Covidien 922,438
12,700 Endurance Specialty Holdings 497,967
12,800 Max Capital Group 362,112
47,744 Nabors Industries (1) 1,340,652
7,600 PartnerRe 632,700
2,090 Platinum Underwriters Holdings 75,240
14,900 RenaissanceRe Holdings 869,266
23,400 XL Capital Class A 1,683,630
--------------
Total Bermuda 13,643,541
--------------
CANADA - 7.2%
21,597 Alimentation Couche Tard Class B 469,838
10,500 AltaGas Income Trust 298,188
24,997 ARC Energy Trust 566,055
5,900 Astral Media 281,589
19,325 Bank of Nova Scotia 1,095,158
9,000 Barrick Gold 400,551
5,550 Bell Aliant Regional
Communications (1) (2) (3) 185,961
15,200 Bonavista Energy Trust (1) 513,002
39,260 Brookfield Asset
Management Class A 1,605,429
22,000 Canaccord Capital 438,275
65,869 Canadian National Railway 3,698,631
8,896 Canadian Natural Resources 740,563
12,800 Canadian Pacific Railway 901,710
10,213 Canadian Tire Class A 940,457
42,666 EnCana 2,988,474
12,345 Enerplus Resources Fund 597,251
26,100 Ensign Energy Services 469,894
75,832 Gerdau Ameristeel 1,028,282
14,700 Gildan Activewear (1) 673,705
23,500 Goldcorp 827,493
33,022 Great-West Lifeco 1,305,204
14,630 Harvest Energy Trust 415,346
20,200 Husky Energy 942,467
26,767 IGM Financial 1,558,596
11,717 Industrial Alliance Insurance
& Financial Services 493,413
87,452 Manulife Financial 4,095,055
13,800 Mullen Group Income Fund 263,219
21,856 National Bank of Canada 1,265,689
22,739 Penn West Energy Trust 725,759
Shares Value $
- -------------- --------------
50,936 Petro-Canada 2,941,625
12,100 Peyto Energy Trust (1) 239,769
3,300 Potash Corp. of Saskatchewan 411,232
44,794 Power Corp. of Canada 1,923,337
37,371 Power Financial 1,667,577
29,195 Precision Drilling Trust 532,731
9,281 PrimeWest Energy Trust 259,775
12,600 Progress Energy Trust (1) 157,951
32,784 Research In Motion (1) 4,090,618
53,684 Rogers Communications Class B 2,738,527
38,986 Royal Bank of Canada 2,315,116
13,300 Saputo 816,716
60,158 Shaw Communications Class B 1,681,645
7,400 ShawCor 308,954
40,200 Sino-Forest (1) 1,070,069
38,500 Sun Life Financial 2,239,340
7,907 Suncor Energy 866,779
35,900 Talisman Energy 782,899
2,079 Teck Cominco Class B 104,225
26,423 Teck Cominco Class B 1,321,150
13,944 Toronto-Dominion Bank 1,054,259
13,800 Trinidad Energy Services
Income Trust 169,630
11,800 Vermilion Energy Trust (1) 492,657
26,800 Yellow Pages Income Fund 406,104
--------------
Total Canada 58,377,939
--------------
CAYMAN ISLANDS - 0.6%
14,672 Garmin (1) 1,575,773
13,800 Herbalife 608,442
83,611 Seagate Technology 2,327,730
4,100 Sina (1) 235,053
--------------
Total Cayman Islands 4,746,998
--------------
PUERTO RICO - 0.0%
13,086 Popular 138,057
--------------
UNITED STATES - 90.2%
APPAREL & ACCESSORY STORES - 0.4%
14,341 Abercrombie & Fitch Class A 1,135,807
36,900 American Eagle Outfitters 877,482
7,100 Jos. A. Bank Clothiers (1) 207,391
27,104 Limited Brands 596,559
3,500 Nordstrom 138,040
--------------
2,955,279
AUTOMOTIVE DEALERS &
GASOLINE SERVICE STATIONS - 0.1%
2,473 Autozone (1) 307,666
--------------
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 29
- --------------------------------------------------------------------------------
SCHRODER NORTH AMERICAN EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
AUTOMOTIVE REPAIR, SERVICES
& PARKING - 0.1%
16,776 Ryder System 802,732
5,300 Wright Express (1) 205,110
--------------
1,007,842
BUILDING CONSTRUCTION
GENERAL CONTRACTORS - 0.0%
800 NVR (1) 380,600
--------------
BUILDING MATERIALS,
HARDWARE, GARDEN SUPPLY
& MOBILE HOME DEALERS - 0.7%
76,746 Home Depot 2,418,267
80,747 Lowe's 2,171,287
22,472 Sherwin-Williams 1,436,410
--------------
6,025,964
BUSINESS SERVICES - 6.3%
15,686 Adobe Systems (1) 751,359
16,426 Affiliated Computer Services
Class A (1) 832,141
7,900 Alliance Data Systems (1) 635,160
8,400 Allis-Chalmers Energy (1) 147,588
36,300 Automatic Data Processing 1,799,028
12,000 Cerner (1) 714,720
39,438 Check Point Software
Technologies (1) 996,204
13,400 Citrix Systems (1) 576,066
9,934 DST Systems (1) 841,509
35,920 eBay (1) 1,296,712
14,500 EPIQ Systems (1) 281,155
11,837 Equifax 455,725
18,100 Fidelity National
Information Services 834,772
8,700 Getty Images (1) 245,775
12,840 Google Class A (1) 9,077,880
7,065 Imergent (1) 170,408
10,600 Jack Henry & Associates 309,732
5,900 Mastercard Class A 1,118,345
494,351 Microsoft 18,197,060
4,464 MicroStrategy Class A (1) 438,945
11,500 NAVTEQ (1) 887,800
29,100 NCR (1) 802,869
24,366 Omnicom Group 1,242,179
318,740 Oracle (1) 7,066,466
30,300 Total System Services 907,788
15,920 United Online 280,192
--------------
50,907,578
CHEMICALS & ALLIED PRODUCTS - 10.4%
62,240 Abbott Laboratories 3,399,549
14,034 Air Products & Chemicals 1,373,227
60,783 Amgen (1) 3,532,100
131,351 Bristol-Myers Squibb 3,939,216
Shares Value $
- -------------- --------------
40,658 Colgate-Palmolive 3,100,986
77,430 Dow Chemical 3,487,447
20,927 Eastman Chemical 1,393,529
50,400 EI du Pont de Nemours 2,495,304
82,996 Eli Lilly 4,494,233
13,106 Genentech (1) 971,548
62,731 Gilead Sciences (1) 2,897,545
179,206 Johnson & Johnson 11,678,855
42,613 Lyondell Chemical 2,021,987
127,028 Merck 7,400,651
390,921 Pfizer 9,620,566
2,837 PharMerica (1) 45,250
24,125 PPG Industries 1,803,102
16,736 Praxair 1,430,593
189,059 Procter & Gamble 13,143,382
31,400 Rohm & Haas 1,629,032
20,621 Schering-Plough 629,353
3,600 SurModics (1) 204,264
7,000 United Therapeutics (1) 479,080
23,000 Valspar 575,690
17,400 Westlake Chemical 426,996
36,231 Wyeth 1,761,914
--------------
83,935,399
COMMUNICATIONS - 4.4%
52,089 Alltel 3,706,132
297,686 AT&T 12,440,298
14,500 Brightpoint (1) 234,900
30,796 CenturyTel 1,356,564
68,729 Citizens Communications 904,474
38,151 Clear Channel Communications 1,440,963
41,470 Comcast Class A (1) 872,944
29,759 Comcast Special Class A (1) 621,070
19,200 CTC Media (1) 481,728
33,700 DIRECTV Group (1) 892,376
9,756 EchoStar Communications
Class A (1) 477,654
58,063 Sprint Nextel 992,877
19,700 USA Mobility 308,108
202,878 Verizon Communications 9,346,589
40,896 Viacom Class B (1) 1,688,596
--------------
35,765,273
DEPOSITORY INSTITUTIONS - 8.1%
260,175 Bank of America 12,561,249
61,924 Bank of New York Mellon 3,024,987
37,187 Capital One Financial 2,439,095
287,372 Citigroup 12,040,887
33,788 Comerica 1,577,224
36,357 Fifth Third Bancorp 1,137,247
18,504 Huntington Bancshares 331,407
42,782 IndyMac Bancorp 574,134
207,163 JPMorgan Chase 9,736,661
48,200 Keycorp 1,371,290
32,436 National City 786,573
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 30
- --------------------------------------------------------------------------------
SCHRODER NORTH AMERICAN EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
11,946 Northern Trust 898,459
20,600 Pacific Capital Bancorp 427,038
28,500 PNC Financial Services Group 2,056,560
36,618 Regions Financial 993,080
21,300 SunTrust Banks 1,546,380
53,100 TCF Financial 1,209,087
52,164 U.S. Bancorp 1,729,758
17,281 UnionBanCal 933,347
127,576 Wachovia 5,834,051
129,699 Wells Fargo 4,411,063
--------------
65,619,577
EATING & DRINKING PLACES - 0.9%
25,244 Darden Restaurants 1,085,492
76,710 McDonald's 4,579,587
38,853 Yum! Brands 1,564,610
--------------
7,229,689
EDUCATIONAL SERVICES - 0.2%
21,568 Apollo Group Class A (1) 1,709,480
--------------
ELECTRIC & OTHER ELECTRICAL EQUIPMENT - 8.2%
23,360 Analog Devices 781,626
31,200 Arris Group (1) 358,800
269,287 Cisco Systems (1) 8,902,628
17,600 Cypress Semiconductor (1) 643,280
32,100 Emcore (1) 346,359
61,254 Emerson Electric 3,201,746
11,800 Energizer Holdings (1) 1,230,740
540,027 General Electric 22,227,511
3,400 Harman International Industries 286,280
37,904 Harris 2,295,466
350,285 Intel 9,422,666
10,500 Lincoln Electric Holdings 758,625
29,029 Linear Technology 958,538
20,486 Maxim Integrated Products 555,171
32,531 Microchip Technology 1,079,053
172,113 Motorola 3,234,003
46,721 National Semiconductor 1,174,566
106,815 Qualcomm 4,564,205
18,600 Smart Modular
Technologies WWH (1) 164,424
103,886 Texas Instruments 3,386,684
9,882 Whirlpool 782,457
--------------
66,354,828
ELECTRIC, GAS & SANITARY SERVICES - 3.2%
32,357 Alliant Energy 1,294,280
35,866 American Electric Power 1,729,100
14,800 Black Hills 657,416
46,303 Consolidated Edison 2,180,408
38,465 DTE Energy 1,907,864
29,500 Edison International 1,715,425
42,702 Exelon 3,534,872
1,700 Markwest Hydrocarbon 102,816
33,200 Mirant (1) 1,406,352
Shares Value $
- -------------- --------------
981 NiSource 20,062
13,100 PNM Resources 327,631
39,410 Progress Energy 1,891,680
24,600 Public Service Enterprise Group 2,351,760
28,622 Republic Services 978,586
59,940 Southern 2,197,400
60,500 TECO Energy 1,018,215
61,990 Waste Management 2,255,816
--------------
25,569,683
ENGINEERING, ACCOUNTING & RESEARCH
MANAGEMENT - 0.6%
37,600 Celgene (1) 2,481,600
11,300 Lifecell (1) 497,878
38,642 Paychex 1,614,463
--------------
4,593,941
FABRICATED METAL PRODUCTS - 0.9%
9,758 Alliant Techsystems (1) 1,077,185
17,288 Ball 857,139
16,189 Commercial Metals 508,011
23,000 Fortune Brands 1,926,710
44,900 Illinois Tool Works 2,570,974
--------------
6,940,019
FOOD & KINDRED PRODUCTS - 4.8%
133,665 Altria Group 9,748,189
28,214 Anheuser-Busch 1,446,814
15,873 Archer-Daniels-Midland 567,936
44,700 Campbell Soup 1,653,006
154,774 Coca-Cola 9,558,842
19,100 Corn Products International 812,514
19,900 Flowers Foods 436,606
10,444 Hormel Foods 380,997
9,100 JM Smucker 486,213
41,323 Kellogg 2,181,441
31,580 Kraft Foods Class A 1,055,088
22,174 Pepsi Bottling Group 955,256
97,191 PepsiCo 7,164,921
68,302 Sara Lee 1,129,715
23,411 Wm. Wrigley Jr. 1,443,756
--------------
39,021,294
FOOD STORES - 0.5%
86,600 Kroger 2,545,174
71,964 Starbucks (1) 1,919,999
--------------
4,465,173
FURNITURE & FIXTURES - 0.2%
3,200 Kinetic Concepts (1) 192,320
18,900 Leggett & Platt 367,227
40,443 Masco 973,867
--------------
1,533,414
GENERAL MERCHANDISE STORES - 1.4%
15,938 Costco Wholesale 1,071,990
18,772 JC Penney 1,055,737
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 31
- --------------------------------------------------------------------------------
SCHRODER NORTH AMERICAN EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
60,620 TJX 1,753,736
161,389 Wal-Mart Stores 7,296,397
--------------
11,177,860
HEALTH SERVICES - 0.4%
6,100 Amedisys (1) 258,945
9,400 Amsurg (1) 248,630
16,323 Coventry Health Care (1) 984,440
25,600 Express Scripts (1) 1,615,360
6,200 Nighthawk Radiology Holdings (1) 145,948
--------------
3,253,323
HOLDING & OTHER
INVESTMENT OFFICES - 1.1%
17 Berkshire Hathaway Class A (1) 2,252,500
9,629 Boston Properties REIT 1,043,206
6,200 Colonial Properties Trust REIT 194,246
9,200 Gramercy Capital REIT 242,604
51,500 Host Hotels & Resorts REIT 1,141,240
17,700 iStar Financial REIT 540,027
23,424 Kimco Realty REIT 972,565
7,400 Ramco-Gershenson
Properties REIT 211,714
15,904 Simon Property Group REIT 1,655,765
5,122 Vornado Realty Trust REIT 572,230
--------------
8,826,097
HOME FURNITURE, FURNISHINGS
& EQUIPMENT STORES - 0.1%
10,865 Best Buy 527,170
--------------
HOTELS, ROOMING HOUSES,
CAMPS & OTHER LODGING - 0.3%
22,900 Marriott International Class A 941,419
7,500 Wynn Resorts (1) 1,210,725
--------------
2,152,144
INDUSTRIAL & COMMERCIAL MACHINERY/
COMPUTER EQUIPMENT - 6.8%
48,535 3M 4,191,483
20,663 American Standard 770,110
37,087 Apple (1) 7,044,676
152,037 Applied Materials 2,952,558
46,483 Caterpillar 3,468,097
14,456 Cummins 1,734,142
7,500 Cymer (1) 318,750
19,097 Deere 2,958,125
117,380 Dell (1) 3,591,828
17,816 Eaton 1,649,405
37,375 EMC (1) 948,951
162,926 Hewlett-Packard 8,420,016
89,916 International Business Machines 10,441,046
29,400 Lam Research (1) 1,475,880
12,077 Lexmark International Class A (1) 507,113
3,000 Lufkin Industries 178,380
25,320 Smith International 1,672,386
Shares Value $
- -------------- --------------
16,800 Stanley Works 966,840
37,800 Teradata (1) 1,078,434
41,639 Western Digital (1) 1,079,283
--------------
55,447,503
INSURANCE AGENTS, BROKERS
& SERVICE - 0.3%
26,900 Hartford Financial Services Group 2,610,107
--------------
INSURANCE CARRIERS - 4.0%
47,300 Aetna 2,656,841
34,700 Aflac 2,178,466
29,649 Allstate 1,553,607
6,417 American Financial Group 191,868
127,523 American International Group 8,049,252
40,600 Chubb 2,166,010
10,000 CNA Financial 396,300
15,529 HCC Insurance Holdings 464,162
24,423 Humana (1) 1,830,504
4,400 Lincoln National 274,428
17,094 MetLife 1,176,922
18,397 MGIC Investment 356,166
9,494 Nationwide Financial
Services Class A 509,353
11,000 Odyssey Re Holdings 408,980
37,700 PMI Group 604,331
6,600 Prudential Financial 638,352
10,720 Selective Insurance Group 260,603
4,700 Transatlantic Holdings 350,291
44,119 Travelers 2,303,453
79,012 UnitedHealth Group 3,883,440
4,000 WellCare Health Plans (1) 96,760
10,948 WellPoint (1) 867,410
31,985 WR Berkley 962,429
--------------
32,179,928
MEASURING, ANALYZING &
CONTROLLING INSTRUMENTS - 2.3%
9,300 Alcon 1,415,553
39,689 Baxter International 2,381,737
21,512 Becton Dickinson 1,795,392
2,300 Intuitive Surgical (1) 751,801
2,400 Kyphon (1) 170,112
64,857 Medtronic 3,076,816
9,800 MTS Systems 436,002
9,600 Rockwell Automation 661,248
7,911 Rockwell Collins 591,822
44,639 St. Jude Medical (1) 1,818,146
28,300 Stryker (1) 2,009,300
12,597 Thermo Fisher Scientific (1) 740,830
9,800 Waters (1) 754,404
47,423 Xerox (1) 827,057
18,053 Zimmer Holdings (1) 1,254,503
--------------
18,684,723
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 32
- --------------------------------------------------------------------------------
SCHRODER NORTH AMERICAN EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
METAL MINING - 0.8%
18,092 Freeport-McMoRan
Copper & Gold 2,129,066
34,951 Newmont Mining 1,777,608
15,888 Southern Copper 2,219,554
--------------
6,126,228
MISCELLANEOUS MANUFACTURING - 0.1%
22,174 Tyco International 912,904
--------------
MISCELLANEOUS RETAIL - 1.3%
16,572 Amazon.com (1) 1,477,394
12,331 Big 5 Sporting Goods 220,108
123,706 CVS Caremark 5,167,200
19,700 Dick's Sporting Goods (1) 657,389
34,786 Office Depot (1) 652,586
26,237 PetSmart 785,798
5,300 Suburban Propane Partners LP 255,195
43,259 Walgreen 1,715,219
--------------
10,930,889
MOTION PICTURES - 0.9%
30,030 News Corp. Class A 650,750
234,697 Time Warner 4,285,567
67,440 Walt Disney 2,335,447
--------------
7,271,764
MOTOR FREIGHT TRANSPORTATION
& WAREHOUSING - 0.6%
10,737 JB Hunt Transport Services 297,630
63,504 United Parcel Service Class B 4,769,150
--------------
5,066,780
NON-DEPOSITORY CREDIT
INSTITUTIONS - 1.5%
17,452 American Capital Strategies 757,591
78,530 American Express 4,786,404
24,400 AmeriCredit (1) 344,284
29,802 CIT Group 1,050,222
38,027 Discover Financial Services (1) 733,921
71,797 Fannie Mae 4,095,301
18,300 KKR Financial Holdings LLC 285,663
--------------
12,053,386
OIL & GAS EXTRACTION - 2.8%
30,267 Anadarko Petroleum 1,786,358
11,300 Apache 1,173,053
56,586 BJ Services 1,425,401
13,400 Brigham Exploration (1) 98,758
14,400 Complete Production Services (1) 286,560
27,004 Devon Energy 2,522,174
13,200 Diamond Offshore Drilling 1,494,636
22,000 ENSCO International 1,220,780
7,800 GlobalSantaFe 632,034
2,502 Halliburton 98,629
6,300 Hercules Offshore (1) 170,352
Shares Value $
- -------------- --------------
13,800 Newfield Exploration (1) 742,992
14,311 Noble Energy 1,095,364
18,505 Occidental Petroleum 1,277,770
19,064 Patterson-UTI Energy 380,136
21,900 Petroquest Energy (1) 282,510
46,169 Schlumberger 4,458,540
7,400 Superior Well Services (1) 150,960
27,181 Weatherford International (1) 1,764,319
25,000 XTO Energy 1,659,500
--------------
22,720,826
PETROLEUM REFINING - 7.0%
133,721 Chevron 12,236,809
106,353 ConocoPhillips 9,035,751
302,004 Exxon Mobil 27,781,348
34,738 Hess 2,487,588
55,819 Marathon Oil 3,300,577
13,800 Tesoro 835,314
19,784 Valero Energy 1,393,387
--------------
57,070,774
PIPELINES, EXCEPT NATURAL GAS - 0.0%
5,100 TEPPCO Partners LP 205,326
--------------
PRIMARY METAL INDUSTRIES - 0.9%
143,691 Corning 3,487,381
9,982 Mueller Industries 358,953
16,365 Nucor 1,014,957
23,200 United States Steel 2,503,280
--------------
7,364,571
PRINTING, PUBLISHING &
ALLIED INDUSTRIES - 0.4%
10,584 EW Scripps Class A 476,386
26,444 Gannett 1,121,490
12,130 Idearc 327,267
14,197 McGraw-Hill 710,418
14,896 Tribune 450,753
--------------
3,086,314
RAILROAD TRANSPORTATION - 0.1%
12,616 Burlington Northern Santa Fe 1,099,484
--------------
REAL ESTATE - 0.0%
13,813 CB Richard Ellis Group
Class A (1) 336,761
--------------
RUBBER & PLASTIC - 0.0%
7,000 Tupperware Brands 252,700
--------------
SECURITY & COMMODITY BROKER,
DEALERS EXCHANGES & SERVICES - 2.3%
86,300 E*Trade Financial (1) 961,382
12,400 Evercore Partners Class A 321,532
17,100 Franklin Resources 2,217,528
9,876 Goldman Sachs Group 2,448,458
43,460 Lehman Brothers Holdings 2,752,756
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 33
- --------------------------------------------------------------------------------
SCHRODER NORTH AMERICAN EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
46,575 Merrill Lynch 3,074,882
74,454 Morgan Stanley 5,007,776
9,170 Nuveen Investments Class A 594,216
17,509 T Rowe Price Group 1,124,778
--------------
18,503,308
TRANSPORTATION BY AIR - 0.0%
10,200 Republic Airways Holdings (1) 217,158
--------------
TRANSPORTATION EQUIPMENT - 3.0%
53,569 Boeing 5,281,368
2,700 General Dynamics 245,592
24,742 Goodrich 1,723,528
28,314 Harley-Davidson 1,458,171
56,360 Honeywell International 3,404,708
34,201 Lockheed Martin 3,763,478
39,918 Paccar 2,217,844
15,400 Tenneco (1) 471,394
70,177 United Technologies 5,374,856
--------------
23,940,939
WATER TRANSPORTATION - 0.1%
16,700 Tidewater 912,989
--------------
WHOLESALE TRADE NON-DURABLE
GOODS - 1.4%
34,029 AmerisourceBergen 1,603,106
27,800 Cardinal Health 1,891,234
17,500 Endo Pharmaceuticals Holdings (1) 512,750
21,800 Medco Health Solutions (1) 2,057,484
45,088 Nike Class B 2,987,531
70,234 Sysco 2,408,324
--------------
11,460,429
WHOLESALE TRADE-DURABLE
GOODS - 0.3%
6,982 Anixter International (1) 501,657
19,266 Arrow Electronics (1) 770,255
20,092 Avnet (1) 838,238
--------------
2,110,150
--------------
Total United States 730,825,234
--------------
TOTAL COMMON STOCK
(Cost $692,325,166) 807,731,769
--------------
Principal
Amount $ Value $
- -------------- --------------
SHORT-TERM
INVESTMENT - 0.4%
3,009,479 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 3,009,479
--------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $3,009,479) 3,009,479
--------------
TOTAL INVESTMENTS - 100.1%
(Cost $695,334,645) 810,741,248
--------------
OTHER ASSETS LESS
LIABILITIES - (0.1)% (610,885)
--------------
NET ASSETS - 100.0% $ 810,130,363
==============
(1) Denotes non-income producing security.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally to qualified institutions. On October 31, 2007, the
value of these securities amounted to $185,961, representing less than
0.1% of the net assets of the Fund.
(3) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $185,961 representing less than 0.1% of the net
assets of the Fund. Security is fair valued. (See Note 2 in Notes to
Financial Statements.)
LLC -- Limited Liability Company
LP -- Limited Partnership
REIT -- Real Estate Investment Trust
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 34
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
COMMON STOCK - 98.1%
AUSTRALIA - 6.6%
16,687 Abacus Property Group (3) 30,212
8,802 Amcor (3) 57,778
6,337 Aspen Group (3) 15,895
3,670 Ausdrill (2) 8,662
4,841 BlueScope Steel (3) 48,269
4,387 Boral (3) 27,870
10,757 Centro Retail Group (3) 16,124
1,973 City Pacific (3) 7,152
19,599 Commonwealth Property
Office Fund (3) 28,996
1,424 Crane Group (3) 22,435
8,624 CSR (3) 27,517
21,909 DB RREEF Trust (3) 42,904
16,376 Futuris (3) 32,530
4,139 Goodman Fielder (3) 8,148
5,918 Hastings Diversified
Utilities Fund (3) 19,097
16,510 ING Industrial Fund (3) 43,251
19,042 ING Office Fund (3) 32,097
335 Macquarie Airports
Management (3) 1,376
14,837 Macquarie CountryWide Trust (3) 27,928
14,897 Macquarie DDR Trust (3) 16,368
21,040 Macquarie Office Trust (3) 32,272
2,959 McPherson's (3) 9,172
3,790 Minara Resources (3) 23,326
4,452 Mirvac Real Estate
Investment Trust (3) 5,903
3,901 OneSteel (3) 25,198
11,656 Pacific Brands (3) 37,687
1,841 Port Bouvard (3) 3,893
7,963 Qantas Airways (3) 44,024
6,832 Ridley (3) 7,270
10,664 Rubicon America Trust (3) 9,351
3,828 Santos (3) 50,510
992 Spotless Group (3) 4,152
123 Stockland (3) 1,033
2 Stockland (1) 17
14,080 Telstra (3) 61,604
7,449 Tishman Speyer Office Fund (3) 15,231
2,681 Westfield Group (3) 54,800
2,306 Zinifex (3) 36,482
--------------
936,534
AUSTRIA - 0.9%
159 Agrana Beteiligungs (3) 16,625
587 OMV (3) 44,079
2,101 Telekom Austria (3) 60,504
--------------
121,208
BELGIUM - 3.5%
3 Banque Nationale de Belgique (3) 14,438
98 Befimmo REIT (3) 10,686
Shares Value $
- -------------- --------------
121 Bekaert (3) 16,704
1,441 Belgacom (3) 69,062
70 Cofinimmo REIT (3) 13,164
656 Cumerio (3) 27,797
545 Delhaize Group (3) 51,973
1,843 Dexia (3) 59,345
1,113 Euronav (3) 33,149
627 Fortis (1) (3) 20,139
378 Gimv (3) 26,273
136 Intervest Offices REIT (3) 5,272
298 KBC Groep (3) 41,889
683 Mobistar (3) 61,881
205 Solvay (3) 31,218
66 Wereldhave Belgium REIT (3) 5,490
--------------
488,480
BERMUDA - 0.1%
1,355 Catlin Group (3) 14,173
--------------
BRAZIL - 1.1%
600 Banco Nossa Caixa 10,673
500 Brasil Telecom Participacoes ADR 37,195
500 Cia de Saneamento Basico do
Estado de Sao Paulo ADR 26,010
800 CPFL Energia 17,632
1,200 Gerdau ADR 37,320
1,400 Tele Norte Leste
Participacoes ADR 30,520
--------------
159,350
BRITISH VIRGIN ISLANDS - 0.0%
5,357 Livermore Investments Group 4,148
--------------
CANADA - 5.8%
3,400 Amerigo Resources 9,908
400 Atco Class I 26,915
981 Baytex Energy Trust 21,013
1,600 BCE 69,938
1,600 Bell Aliant Regional
Communications 53,610
800 Biovail 16,081
800 Cinram International Income Fund 11,105
1,100 Emera 23,872
900 Empire Class A 52,549
532 Enerplus Resources Fund 25,738
500 Fording Canadian Coal Trust 18,343
1,442 GAZ Metro LP 24,448
2,040 Gerdau Ameristeel 27,662
1,000 InnVest REIT 12,599
600 Laurentian Bank of Canada 27,784
300 Magna International Class A 28,490
600 Manitoba Telecom Services 29,882
1,700 Methanex 51,971
1,000 Mullen Group Income Fund 19,074
3,000 Norbord 25,432
800 Northbridge Financial 31,366
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 35
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
800 Phoenix Technology Income Fund 6,782
1,000 Power Corp. of Canada 42,937
400 Precision Drilling Trust 7,299
1,400 Provident Energy Trust 18,529
600 Quebecor World 5,849
1,100 Rothmans 28,768
2,200 Superior Plus Income Fund 29,001
1,600 Total Energy Services Trust 11,343
1,400 TransForce Income Fund 15,681
700 Vicwest Income Fund 7,826
300 West Fraser Timber 10,205
2,200 Yellow Pages Income Fund 33,337
--------------
825,337
CHILE - 0.1%
200 Administradora de Fondos
de Pensiones Provida ADR (1) 7,940
--------------
CHINA - 0.6%
26,000 China Petroleum & Chemical
Class H (3) 41,399
34,000 China Telecom Class H (3) 29,399
7,000 People's Food Holdings (1) (3) 6,389
4,500 Weiqiao Textile Class H (3) 8,479
--------------
85,666
DENMARK - 0.5%
1,050 D/S Torm (1) (3) 44,130
300 TrygVesta (3) 23,911
--------------
68,041
FINLAND - 2.0%
630 Elcoteq (3) 4,109
1,430 Huhtamaki (3) 20,523
400 Kesko B Shares (3) 24,029
1,514 Neste Oil (3) 54,565
1,807 Outokumpu (3) 67,810
1,242 PKC Group (3) 19,124
600 Rautaruukki (3) 34,582
2,248 Stora Enso R Shares (3) 41,472
905 UPM-Kymmene (3) 20,332
--------------
286,546
FRANCE - 7.9%
1,300 Air France-KLM (3) 49,613
1,241 AXA (3) 55,747
572 BNP Paribas (3) 63,403
440 Bongrain (3) 51,769
684 Bouygues (3) 66,021
535 Casino Guichard-Perrachon (3) 59,913
462 CNP Assurances (3) 59,037
138 Compagnie Plastic-Omnium (3) 8,953
1,393 Credit Agricole (3) 55,195
201 Esso Ste Anonyme Francaise (3) 64,750
946 Etablissements Maurel et Prom (3) 21,000
1,617 France Telecom (3) 59,804
Shares Value $
- -------------- --------------
2,487 Natixis (3) 55,308
463 Nexity (3) 30,912
479 Peugeot (3) 44,651
254 Pierre & Vacances (3) 33,413
478 Rallye (3) 36,740
403 Renault (3) 68,074
318 Societe Generale (3) 53,729
169 Ste Industrielle d'Aviation
Latecoere (3) 5,247
781 TOTAL (3) 63,031
949 Valeo (3) 52,252
1,387 Vivendi (3) 62,685
--------------
1,121,247
GERMANY - 6.3%
48 Allianz (3) 10,823
187 Allianz (1) (3) 42,113
220 AMB Generali Holding (3) 34,503
420 BASF (3) 58,150
765 Bayerische Motoren Werke (3) 51,201
525 DaimlerChrysler (3) 57,443
440 Deutsche Bank (1) (3) 58,510
2,001 Deutsche Lufthansa (3) 59,083
1,794 Deutsche Post (3) 54,369
2,929 Deutsche Telekom (3) 60,140
277 E.ON (3) 54,160
926 Hannover Rueckversicherung (3) 48,884
906 IKB Deutsche Industriebank (3) 18,860
455 Indus Holding (3) 16,999
285 Koenig & Bauer (3) 9,959
848 Leoni (3) 53,791
269 Muenchener Rueckversicherungs (3) 51,643
573 Norddeutsche Affinerie (3) 23,841
478 RWE (3) 65,307
125 Schlott Gruppe (3) 3,565
256 Sixt (3) 13,790
691 ThyssenKrupp (3) 46,030
--------------
893,164
GREECE - 0.2%
1,320 Heracles General Cement (3) 33,924
--------------
GUERNSEY - 0.1%
5,219 ISIS Property Trust 2 (3) 11,081
--------------
HONG KONG - 1.5%
14,000 CCT Telecom Holdings (3) 2,485
36,822 Champion Technology Holdings (3) 8,193
7,500 CLP Holdings (3) 50,687
2,000 Guoco Group (3) 30,794
7,000 HongKong Electric Holdings (3) 35,989
12,000 Hung Hing Printing Group (3) 6,186
22,000 Lerado Group Holdings (3) 1,826
3,000 Orient Overseas International (3) 30,972
2,781 Prosperity Minerals Holdings (3) 9,984
18,000 Public Financial Holdings (3) 11,753
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 36
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
24,000 Silver Grant International (3) 5,250
16,000 Sinolink Worldwide Holdings (3) 5,436
14,000 TPV Technology (3) 9,428
5,000 Varitronix International (3) 3,745
--------------
212,728
HUNGARY - 0.0%
38 MOL Hungarian Oil & Gas (3) 5,889
--------------
INDIA - 0.1%
800 Mahanagar Telephone
Nigam ADR (1) 7,360
--------------
IRELAND - 0.5%
753 FBD Holdings (3) 27,041
1,959 Irish Life & Permanent (3) 44,530
--------------
71,571
ISRAEL - 0.8%
3,959 Bank Hapoalim (3) 21,929
4,582 Bank Leumi Le-Israel (3) 22,060
5,521 Bezeq Israeli Telecommunication (3) 9,839
573 Blue Square-Israel (1) (3) 7,862
46 Delek Group (3) 11,346
265 Discount Investment (3) 8,293
232 IDB Development (3) 9,292
133 IDB Holding (1) (3) 4,642
5,619 Migdal Insurance &
Financial Holdings (3) 10,664
743 Partner Communications (3) 14,105
--------------
120,032
ITALY - 5.9%
7,695 AEM (3) 32,458
2,604 Alleanza Assicurazioni (3) 35,302
3,453 Banca Popolare di Milano (1) (3) 54,408
291 Banco di Sardegna (3) 7,861
1,371 Banco Popolare 32,911
2,182 Caltagirone (1) (3) 23,250
8,978 Cofide (3) 16,476
5,057 Cremonini (3) 15,539
5,016 Enel (1) (3) 60,150
1,705 ENI (3) 62,262
1,189 ERG (3) 24,621
1,754 Ergo Previdenza (3) 10,347
1,078 Fondiaria (3) 52,494
7,679 Intesa Sanpaolo (1) (3) 60,925
204 Italmobiliare (3) 25,127
3,269 KME Group (1) (3) 9,218
1,746 Milano Assicurazioni (3) 14,596
3,113 Navigazione Montanari (3) 15,790
171 Pirelli & C Real Estate (3) 8,479
6,859 Premuda (3) 17,278
3,710 Snam Rete Gas (3) 24,021
21,228 Telecom Italia (3) 66,527
15,045 Terna Rete Elettrica Nazionale (3) 58,978
Shares Value $
- -------------- --------------
1,861 Unione di Banche Italiane (3) 51,888
13,810 Unipol (3) 51,910
--------------
832,816
JAPAN - 13.0%
3,500 Aeon Credit Service (3) 53,857
3,000 Arnest One (3) 17,025
14 Asset Managers (3) 23,892
800 Chugoku Electric Power (3) 15,757
2,000 Daihatsu Motor (3) 21,363
8,000 Daikyo (1) (3) 27,517
4,000 Dainippon Screen
Manufacturing (1) (3) 23,787
1,000 Daio Paper (3) 8,311
1,000 Denki Kogyo (3) 7,074
1,900 Duskin (3) 32,190
44 Dynacity (3) 2,546
9,000 Fuji Heavy Industries (3) 46,788
4,000 Fujitsu (3) 31,414
500 Fuyo General Lease (3) 16,566
2,000 Godo Steel (3) 6,955
2 Grandy House (3) 709
360 Gulliver International (3) 20,574
600 Hakuto (3) 8,233
2,000 Hanwa (3) 10,223
800 Hitachi Capital (3) 10,633
2,000 Hodogaya Chemical (3) 6,010
1,000 Hokkaido Electric Power (3) 21,584
4,000 Hokkaido Gas (3) 10,318
900 Honda Motor (3) 33,709
4,000 Ichiken (3) 10,419
900 Japan Electronic Materials (3) 9,927
1,200 Japan Medical Dynamic
Marketing (3) 3,989
1,000 Joshin Denki (3) 7,137
600 Kaga Electronics (3) 8,814
1,700 Kansai Electric Power (3) 38,292
2,000 Kasai Kogyo (3) 6,278
700 Kojima (3) 4,245
200 Kyoshin Technosonic (3) 1,502
1,600 Kyushu Electric Power (3) 39,020
300 Mitsubishi UFJ Lease & Finance (3) 10,395
5,000 Mitsui Trust Holdings (3) 40,016
600 Muto Seiko (3) 5,271
1,100 NAC (3) 10,699
3,000 Nakayama Steel Works (3) 7,230
700 NEC Leasing (3) 12,376
1,000 Nippon Denwa Shisetsu (3) 3,234
3,000 Nippon Formula Feed
Manufacturing (3) 4,825
3,000 Nippon Light Metal (3) 6,191
6,000 Nippon Mining Holdings (3) 56,762
15 Nippon Paper Group (3) 44,923
12 Nippon Telegraph & Telephone (3) 54,932
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 37
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
2,000 Nipro (3) 38,167
5,000 Nissan Motor (3) 57,376
2,000 Nissan Shatai (3) 16,117
6,000 Nissin Sugar Manufacturing (1) (3) 12,089
700 Nittan Valve 4,612
39 NTT DoCoMo (3) 56,753
11,000 Obayashi (3) 55,443
2 Okinawa Cellular Telephone (3) 5,859
1,000 Oriental Yeast (3) 5,343
2,000 Pacific Industrial (3) 10,113
500 Poplar (3) 3,361
29 Resona Holdings (3) 51,977
500 Ricoh Leasing (3) 11,682
3,000 San-Ai Oil (3) 12,875
2,000 Sanden (3) 12,023
1,200 Sanoh Industrial (3) 9,950
1,900 Sega Sammy Holdings (3) 26,239
600 Shinhokoku Steel (3) 3,458
3,400 Showa Shell Sekiyu (3) 40,039
6,000 Sumikin Bussan (3) 25,411
8 Tact Home (3) 4,522
4,000 Taihei Kogyo (3) 20,798
1,100 Taiho Kogyo (3) 16,493
13,000 Taisei (3) 39,121
660 Takefuji (3) 16,892
4,000 Takisawa Machine Tool (3) 7,672
2,000 Tayca (3) 5,928
2,000 TBK (3) 8,640
2,000 Tobu Store (3) 6,815
1,100 Tohoku Electric Power (3) 23,249
2,000 Tokai (3) 7,819
1,000 Tokai Lease (3) 1,703
5,000 Tokai Tokyo Securities (3) 26,948
1,700 Tokyo Electric Power (3) 43,147
7,000 Tokyo Gas (3) 31,214
4,000 Tomoku (3) 8,409
5,000 Tonichi Carlife Group (1) 7,023
5,000 Toppan Printing (3) 48,792
3,000 Toshiba TEC (3) 19,236
3,000 Tosho Printing (3) 7,733
4,500 Towa Real Estate
Development (1) (3) 11,743
6,000 Toyo Ink Manufacturing (3) 20,491
1,700 Toyota Auto Body (3) 27,470
400 Toyota Motor (3) 22,903
1,700 Unipres (3) 13,762
2,000 UNY (3) 17,344
200 USC (3) 2,749
1,000 Yachiyo Industry (3) 12,840
1,800 Yamaha Motor (3) 51,411
300 Yorozu (3) 4,237
--------------
1,839,503
Shares Value $
- -------------- --------------
LIECHTENSTEIN - 0.2%
225 Liechtenstein Landesbank (3) 21,631
--------------
MALAYSIA - 0.5%
4,300 Hong Leong Financial Group (3) 7,737
9,700 Padiberas Nasional (1) (3) 6,283
6,200 Petronas Dagangan (3) 16,600
4,000 Shell Refining (3) 13,850
2,000 Telekom Malaysia (1) (3) 6,147
14,000 Titan Chemicals (3) 6,583
14,500 YTL Power International (1) (3) 10,477
--------------
67,677
MEXICO - 0.1%
1,600 Alfa Class A 10,815
2,500 Grupo Continental (1) 5,868
--------------
16,683
NETHERLANDS - 4.7%
2,705 Aegon (3) 56,081
1,247 Corporate Express (3) 13,961
863 Grontmij (3) 40,535
1,122 Heineken Holding (3) 66,568
1,496 Imtech (1) (3) 46,426
1,161 ING Groep (3) 52,482
253 KAS Bank (3) 9,548
447 Koninklijke (3) 25,393
461 Nieuwe Steen
Investments Funds (3) 12,994
2,430 OCE (3) 48,961
1,363 Royal Dutch Shell A Shares (3) 59,770
1,419 Royal Dutch Shell B Shares (3) 61,899
3,333 Royal KPN (3) 62,938
2,249 SNS Reaal (3) 54,075
2,302 Trader Classified Media Class A 434
446 Vastned Offices/Industrial (3) 15,830
235 Vastned Retail REIT (3) 20,227
105 Wereldhave (3) 12,544
--------------
660,666
NEW ZEALAND - 0.4%
4,151 Air New Zealand (3) 6,818
2,955 Fisher & Paykel Appliances
Holdings (3) 8,024
1,497 Fletcher Building (3) 13,747
7,801 ING Property Trust (3) 6,806
1,780 Steel & Tube Holdings (3) 6,051
2,607 Telecom Corp. of New Zealand (3) 8,753
--------------
50,199
NORWAY - 3.1%
9,000 ABG Sundal Collier (3) 25,057
480 Aker A Shares (3) 34,786
1,000 Aker Yards (3) 16,649
1,900 BW Gas (3) 25,847
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 38
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
800 Cermaq (3) 12,328
1,900 DnB NOR (3) 31,509
1,200 Frontline (3) 54,307
900 Leroy Seafood Group (3) 19,175
1,400 Norsk Hydro (3) 20,597
2,000 Norske Skogindustrier (3) 22,142
1,100 Sparebanken Midt-Norge (3) 15,784
250 Sparebanken Nord-Norge (3) 6,509
1,067 Sparebanken Rogaland (3) 13,749
1,907 Statoil (3) 65,011
3,100 Telenor (3) 73,043
--------------
436,493
PHILIPPINES - 0.3%
5,000 First Gen (3) 7,005
400 Globe Telecom (3) 15,804
200 Philippine Long Distance
Telephone ADR 13,720
24,400 Universal Robina (3) 8,408
--------------
44,937
POLAND - 0.4%
280 KGHM Polska Miedz (3) 15,288
4,052 Telekomunikacja Polska (3) 38,420
--------------
53,708
PORTUGAL - 0.6%
3,931 Portugal Telecom (1) (3) 52,773
554 PT Multimedia Servicos de
Telecomunicacoes (1) (3) 7,542
1,886 Semapa-Sociedade de
Investimento e Gestao (3) 30,756
--------------
91,071
RUSSIA - 0.1%
48 LUKOIL ADR 4,344
200 Vimpel-Communications ADR (1) 6,614
--------------
10,958
SINGAPORE - 1.1%
17,000 Beyonics Technology (1) (3) 5,170
8,000 HTL International Holdings (3) 4,366
1,000 Jardine Cycle & Carriage (3) 14,664
6,000 Jurong Technologies
Industrial (1) (3) 2,904
8,000 Kim Eng Holdings (1) (3) 12,825
16,800 MobileOne (1) (3) 24,476
3,733 Singapore Airlines (3) 50,969
6,000 Singapore Petroleum (3) 34,271
--------------
149,645
SOUTH AFRICA - 1.1%
3,056 African Bank Investments (3) 17,176
481 Astral Foods (1) (3) 9,878
1,003 JD Group (3) 9,672
1,227 Liberty Group (1) (3) 18,123
Shares Value $
- -------------- --------------
449 Liberty Holdings (1) (3) 16,746
6,245 Metropolitan Holdings (3) 15,390
4,750 Nampak (3) 15,958
219 Nedbank Group (3) 4,852
5,751 Pick'n Pay Holdings (1) (3) 13,748
1,129 Telkom (3) 31,042
--------------
152,585
SOUTH KOREA - 2.5%
160 Cambridge Members (3) 5,162
310 GS Holdings (3) 22,263
121 GS Home Shopping (3) 10,325
190 Hyundai Motor (3) 15,105
160 INTOPS (3) 6,568
810 Korea Electric Power (3) 35,823
450 Korea Gas (3) 33,698
1,200 KT ADR 28,224
790 KT Freetel (3) 29,128
122 LG (3) 11,169
650 LG Dacom 21,125
72 LS Cable (3) 11,127
210 Pusan City Gas (3) 6,256
250 S-Oil (3) 22,716
220 SK Energy (1) 50,583
1,200 SK Telecom ADR 36,972
580 SL (3) 5,436
1,020 Tae Kyung Industrial (3) 5,306
--------------
356,986
SPAIN - 1.3%
1,900 Banco Santander
Central Hispano (3) 41,557
4,100 Mapfre (3) 19,341
1,567 Repsol (1) (3) 61,915
1,982 Telefonica (3) 65,634
--------------
188,447
SWEDEN - 3.7%
750 Axfood (3) 26,527
600 Bilia A Shares (3) 9,748
1,950 Boliden (3) 34,577
2,300 Brostrom B Shares (3) 23,195
1,000 D Carnegie (3) 22,209
2,000 Electrolux Series B (3) 38,867
1,700 Fabege (3) 20,313
600 Haldex (3) 12,367
300 Holmen B Shares (3) 11,840
1,600 Investor B Shares (3) 39,776
2,500 Klovern (3) 10,282
2,200 Kungsleden (3) 31,514
1,300 NCC B Shares (3) 32,489
1,400 Ratos B Shares (3) 41,322
1,800 Securitas B Shares (3) 22,780
900 Svenska Cellulosa B Shares (3) 15,908
6,000 TeliaSonera (3) 59,218
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 39
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
800 Trelleborg B Shares (3) 20,467
2,500 Volvo A Shares (1) (3) 48,762
--------------
522,161
SWITZERLAND - 2.4%
119 Baloise Holding (1) (3) 12,676
112 Basler Kantonalbank (3) 11,005
554 Ciba Specialty Chemicals (3) 27,603
391 Credit Suisse Group (3) 26,430
32 Georg Fischer (3) 24,080
32 Helvetia Holding (3) 11,634
15 Schweizerische National-
Versicherungs-Gesellschaft (3) 11,787
120 Swiss Life Holding (3) 33,227
524 Swiss Reinsurance (3) 49,278
159 Swisscom (3) 58,866
70 Valora Holding (3) 17,844
189 Zurich Financial Services (3) 57,080
--------------
341,510
TAIWAN - 2.4%
25,750 China Steel (3) 36,566
12,000 Chung Hung Steel (1) (3) 6,791
15,400 Chunghwa Telecom (3) 29,652
1,210 Chunghwa Telecom ADR 23,232
2,000 Compal Communications (1) (3) 5,108
30,150 Compal Electronics (3) 38,527
9,100 Coretronic (3) 14,158
880 Eclat Textile (3) 515
23,000 Far EasTone
Telecommunications (3) 28,598
14,000 Inotera Memories (3) 13,430
13,198 King Yuan Electronics (3) 8,842
15,109 Mitac International (3) 19,743
34,599 Nanya Technology (3) 21,930
11,218 POU Chen (1) (3) 10,755
45,040 Powerchip Semiconductor (3) 20,962
32,000 ProMOS Technologies (1) (3) 9,131
4,000 Quanta Computer (1) (3) 6,730
16,000 Taiwan Mobile (3) 21,597
22,309 United Microelectronics 14,636
25,000 Walsin Lihwa (3) 13,592
--------------
344,495
THAILAND - 0.2%
4,400 Advanced Info Service (3) 11,676
40,800 Land & Houses (3) 10,073
1,600 Siam Cement (3) 12,410
--------------
34,159
TURKEY - 0.7%
1,700 Aksa Akrilik Kimya Sanayii (3) 4,689
762 Anadolu Efes Biracilik
Ve Malt (1) (3) 9,429
1,198 Arcelik (3) 9,259
2,011 Bolu Cimento (1) (3) 4,467
Shares Value $
- -------------- --------------
5,879 Dogan Sirketler
Grubu Holdings (3) 13,139
1,178 Ford Otomotiv Sanayi (3) 13,948
922 Mardin Cimento (1) (3) 5,686
1,695 Sarkuysan Elektrolitik Bakir (3) 5,131
794 Tupras Turkiye Petrol Rafine (3) 22,734
1,511 Usas Ucak Servisi (3) 3,573
--------------
92,055
UNITED KINGDOM - 14.8%
3,046 Acertec (3) 7,274
2,246 Alliance & Leicester (3) 36,951
699 Anglo American (3) 48,612
3,076 Antofagasta (3) 53,803
2,273 Armor Group International (3) 2,626
2,470 Arriva (3) 43,217
1,061 AstraZeneca (3) 52,239
3,710 Aviva (3) 58,442
4,290 Barclays (3) 54,286
6,061 Beazley Group (3) 21,843
5,184 BP (3) 67,431
5,557 Brit Insurance Holdings (3) 37,612
4,763 British Energy Group (1) (3) 52,895
920 British Polythene Industries (3) 6,409
8,960 BT Group (3) 60,892
9,886 Chaucer Holdings (3) 24,096
2,439 Chesnara (3) 8,908
8,987 Christian Salvesen 17,048
6,947 Clinton Cards (3) 9,819
1,081 Close Brothers Group (3) 17,324
3,788 Davis Service Group (3) 43,029
1,586 Dawson Holdings 3,643
3,792 Drax Group (3) 53,387
4,005 DS Smith (3) 19,299
16,747 DSG International (3) 45,224
11,047 FKI (3) 21,378
11,188 Friends Provident (3) 42,941
940 GlaxoSmithKline (3) 24,140
2,893 HBOS (3) 52,724
6,340 Highway Insurance Holdings (3) 10,359
4,920 Hiscox (3) 29,451
7,327 HMV Group (3) 19,218
6,218 Home Retail Group (3) 56,520
2,718 HSBC Holdings (3) 53,879
1,029 Investec (3) 12,493
5,329 Jessops (3) 1,111
525 John Menzies (3) 6,230
1,666 Johnson Service Group 5,074
1,191 Kelda Group (3) 23,555
7,722 Kesa Electricals (3) 51,260
3,685 Kingfisher (3) 15,164
11,027 Kingston Communications (3) 15,275
2,822 Ladbrokes (3) 24,243
18,146 Legal & General Group (3) 52,965
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 40
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL DIVERSIFIED VALUE FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
4,730 Lloyds TSB Group (3) 53,721
5,484 London Scottish Bank (3) 9,481
4,741 Melrose (3) 18,850
238 Mondi 2,206
95 Mondi Ltd. (1) 929
3,995 Northern Rock (3) 15,476
15,332 Old Mutual (3) 58,840
2,744 Paragon Group (3) 13,591
10,545 Pendragon (3) 14,799
4,395 Rexam (3) 49,659
1,452 Robert Wiseman Dairies (3) 14,222
4,649 Royal Bank of Scotland Group (3) 50,200
1,536 RPC Group 8,933
1,973 ScS Upholstery (3) 7,707
1,872 Severn Trent (3) 56,554
11,304 Signet Group (3) 21,315
5,810 Stagecoach Group (3) 32,809
400 Stolt-Nielsen (3) 11,746
4,370 Tate & Lyle (3) 39,649
11,098 Taylor Woodrow (3) 57,401
1,931 TDG (3) 9,442
11,659 Tomkins (3) 54,019
3,038 TT electronics (3) 9,373
946 United Utilities (3) 14,380
15,968 Vodafone Group (3) 62,911
1,706 Wolseley (3) 29,666
24,233 Woolworths Group (3) 10,745
--------------
2,092,913
--------------
TOTAL COMMON STOCK
(Cost $12,203,686) 13,875,717
--------------
PREFERRED STOCK - 1.3%
BRAZIL - 1.1%
2,300 Investimentos Itau 17,323
6,000 Klabin 25,059
700 Metalurgica Gerdau 28,224
500 Petroleo Brasileiro 20,868
700 Telemar Norte Leste ADR (1) 27,333
400 Usinas Siderurgicas de
Minas Gerais Class A 31,397
--------------
150,204
CHILE - 0.0%
1,269 Embotelladora Andina Class A (1) 3,866
--------------
GERMANY - 0.2%
918 ProSiebenSat.1 Media (3) 27,152
--------------
TOTAL PREFERRED STOCK
(Cost $100,354) 181,222
--------------
Principal
Amount $ Value $
- -------------- --------------
SHORT-TERM
INVESTMENT - 0.8%
108,009 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 108,009
--------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $108,009) 108,009
--------------
TOTAL INVESTMENTS - 100.2%
(Cost $12,412,049) 14,164,948
--------------
OTHER ASSETS LESS
LIABILITIES - (0.2)% (26,178)
--------------
NET ASSETS - 100.0% $ 14,138,770
==============
(1) Denotes non-income producing security.
(2) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $8,662 representing 0.1% of the net assets of the
Fund.
(3) Security is fair valued. (See Note 2 in Notes to Financial Statements.)
ADR -- American Depositary Receipts
LP -- Limited Partnership
Ltd. -- Limited
REIT -- Real Estate Investment Trust
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 41
- --------------------------------------------------------------------------------
SCHRODER U.S. OPPORTUNITIES FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Shares Value $
- ------------- --------------
COMMON STOCK - 87.1%
AUTOS & TRANSPORTATION - 2.4%
73,000 Horizon Lines Class A 2,296,580
34,700 Kansas City Southern (1) 1,342,543
48,200 Republic Airways Holdings (1) 1,026,178
85,300 Seaspan 2,722,776
-------------
7,388,077
CONSUMER DISCRETIONARY - 14.1%
62,900 Ambassadors Group 1,142,893
34,300 Bright Horizons
Family Solutions (1) 1,330,840
281,300 Central Garden & Pet (1) 2,331,977
83,800 Central Garden &
Pet Class A (1) 697,216
69,900 Children's Place (1) 1,789,440
87,600 Clear Channel Outdoor
Holdings Class A (1) 2,226,792
66,800 Diamond Management &
Technology Consultants 713,424
110,800 Geo Group (1) 3,504,604
21,000 Heidrick & Struggles
International (1) 907,620
31,600 Home Inns & Hotels
Management ADR (1) 1,391,348
41,800 LKQ (1) 1,611,808
43,200 Pinnacle Entertainment (1) 1,261,440
52,100 Regis 1,750,560
94,300 Rent-A-Center (1) 1,508,800
14,579 Ritchie Brothers Auctioneers 1,090,947
147,700 Scientific Games Class A (1) 5,339,355
51,100 Sonic (1) 1,266,258
51,000 Standard Parking (1) 2,187,900
13,600 Talbots 200,056
55,500 THQ (1) 1,503,495
128,900 Valueclick (1) 3,504,791
31,300 Viad 1,109,272
85,900 Waste Connections (1) 2,904,279
45,400 Watson Wyatt Worldwide Class A 2,164,218
-------------
43,439,333
CONSUMER STAPLES - 0.2%
34,200 Flowers Foods 750,348
-------------
FINANCIAL SERVICES - 13.4%
114,850 Annaly Capital
Management REIT 1,962,787
61,864 Apollo Investment (2) 1,286,771
45,063 Argo Group International
Holdings (1) 1,920,134
79,000 Bank of Hawaii 4,199,640
40,400 Berkshire Hills Bancorp 1,125,948
264,500 Conseco (1) 4,176,455
31,243 Cullen/Frost Bankers 1,661,503
101,420 CVB Financial 1,188,642
Shares Value $
- ------------- --------------
33,900 Digital Realty Trust 1,491,261
105,200 Euronet Worldwide (1) 3,369,556
72,750 H&E Equipment Services (1) 1,282,583
60,608 Health Care REIT 2,684,328
21,500 Investment Technology Group (1) 900,850
74,400 Investors Real Estate Trust REIT 807,240
96,200 National Retail Properties REIT 2,438,670
146,300 Online Resources (1) 1,353,275
47,185 PennantPark Investment 616,236
83,100 Reinsurance Group of America 4,747,503
19,800 SVB Financial Group (1) 1,025,442
64,400 Westamerica Bancorporation 3,096,352
-------------
41,335,176
HEALTH CARE - 14.3%
33,200 Amsurg (1) 878,140
86,200 Array Biopharma (1) 965,440
6,400 athenahealth (1) 244,672
308,000 Bruker BioSciences (1) 3,187,800
97,300 Cepheid (1) 2,518,124
67,300 Cooper 2,826,600
60,700 Dialysis Corp. of America (1) 564,510
81,000 DJO (1) 4,045,950
45,400 Haemonetics (1) 2,333,106
36,668 Immucor (1) 1,182,543
192,800 Lexicon Pharmaceuticals (1) 696,008
71,900 Luminex (1) 1,146,086
62,600 Medicis Pharmaceutical Class A 1,858,594
62,700 Nastech Pharmaceutical (1) 854,601
37,400 Northstar Neuroscience (1) 495,550
194,300 Perrigo 4,606,853
62,400 PolyMedica 3,304,704
31,900 Psychiatric Solutions (1) 1,263,240
166,300 Salix Pharmaceuticals (1) 1,945,710
58,000 Sirona Dental Systems (1) 1,951,120
66,300 Sirtris Pharmaceuticals (1) 1,124,448
94,400 Skilled Healthcare
Group Class A (1) 1,546,272
172,800 Sun Healthcare Group (1) 2,790,720
1,300 Trans1 (1) 32,500
34,000 Volcano (1) 581,060
30,400 West Pharmaceutical Services 1,256,736
-------------
44,201,087
MATERIALS & PROCESSING - 8.2%
49,400 Airgas 2,493,218
33,100 Albany International Class A 1,241,250
24,900 Brush Engineered Materials (1) 1,202,670
84,500 Cabot 2,958,345
23,300 Clean Harbors (1) 1,147,059
32,100 FMC 1,845,750
40,000 Interface Class A 765,200
41,300 Koppers Holdings 1,850,240
72,300 Pan American Silver (1) 2,395,299
10,700 Perini (1) 613,645
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 42
- --------------------------------------------------------------------------------
SCHRODER U.S. OPPORTUNITIES FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Shares Value $
- ------------- --------------
30,400 Schnitzer Steel Industries Class A 2,008,528
38,100 Shaw Group (1) 2,842,260
69,409 ShawCor 2,897,864
59,451 Yamana Gold (1) 892,954
-------------
25,154,282
OTHER ENERGY - 9.0%
9,500 Arena Resources (1) 346,845
44,700 CARBO Ceramics 2,007,924
88,600 Concho Resources (1) 1,726,814
53,638 Denbury Resources (1) 3,035,911
154,800 Dresser-Rand Group (1) 5,990,760
23,595 Exterran Holdings (1) 1,986,699
51,700 FMC Technologies (1) 3,134,571
89,419 Galleon Energy Class A (1) 1,363,505
21,000 Ormat Technologies 1,132,530
11,400 Parallel Petroleum (1) 233,358
104,300 St. Mary Land & Exploration 4,418,148
59,746 Willbros Group (1) 2,286,479
-------------
27,663,544
PRODUCER DURABLES - 6.8%
33,200 Actuant Class A 2,290,136
201,100 Arris Group (1) 2,312,650
63,900 ESCO Technologies (1) 2,644,821
124,100 FEI (1) 3,600,141
37,950 IDEX 1,344,189
20,600 Manitowoc 1,014,756
116,000 MTC Technologies (1) 2,121,640
103,100 Tektronix 3,902,335
95,600 Veeco Instruments (1) 1,727,492
-------------
20,958,160
TECHNOLOGY - 14.7%
113,300 Aspen Technology (1) 1,975,952
27,400 CommScope (1) 1,292,458
4,600 Constant Contact (1) 114,540
49,300 CSG Systems International (1) 1,012,129
20,500 DRS Technologies 1,177,520
191,500 Emulex (1) 4,147,890
62,400 F5 Networks (1) 2,248,272
126,600 Gartner (1) 2,772,540
61,000 Genesis Microchip (1) 450,180
45,900 GeoEye (1) 1,437,129
178,500 GSI Technology (1) 526,575
264,000 Informatica (1) 4,509,120
86,700 Interwoven (1) 1,230,273
96,100 IPG Photonics (1) 1,829,744
43,200 Mantech International Class A (1) 1,717,632
107,700 Microsemi (1) 2,865,897
131,560 Parametric Technology (1) 2,512,796
193,300 QLogic (1) 3,001,949
94,000 RightNow Technologies (1) 1,881,880
220,800 SonicWALL (1) 2,283,072
32,000 Standard Microsystems (1) 1,248,000
Shares Value $
- ------------- --------------
100,800 Syniverse Holdings (1) 1,682,352
119,800 TAC Acquisition (3) 7,487
118,300 Vishay Intertechnology (1) 1,489,397
143,500 Volterra Semiconductor (1) 1,763,615
-------------
45,178,399
UTILITIES - 4.0%
52,300 Consolidated
Communications Holdings 1,041,293
147,600 Mediacom
Communications Class A (1) 848,700
54,700 NorthWestern 1,508,626
151,600 Paetec Holdings (1) 2,039,020
43,350 PNM Resources 1,084,184
55,600 Portland General Electric 1,565,140
69,500 Time Warner Telecom Class A (1) 1,615,180
17,600 UIL Holdings 619,168
65,300 Unisource Energy 2,071,316
-------------
12,392,627
-------------
TOTAL COMMON STOCK
(Cost $218,401,166) 268,461,033
-------------
INVESTMENT COMPANY - 1.0%
37,800 iShares Russell 2000 Index Fund 3,111,696
-------------
TOTAL INVESTMENT COMPANY
(Cost $2,969,595) 3,111,696
-------------
Principal
Amount $
- -------------
SHORT-TERM
INVESTMENT - 11.6%
35,884,575 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 35,884,575
-------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $35,884,575) 35,884,575
-------------
TOTAL INVESTMENTS - 99.7%
(Cost $257,255,336) 307,457,304
-------------
OTHER ASSETS LESS
LIABILITIES - 0.3% 803,866
-------------
NET ASSETS - 100.0% $ 308,261,170
=============
(1) Denotes non-income producing security.
(2) Business development company.
(3) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $7,487 representing less than 0.1% of the net
assets of the Fund.
ADR -- American Depositary Receipts
REIT -- Real Estate Investment Trust
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 43
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALL AND MID CAP OPPORTUNITIES FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Shares Value $
- ------------- --------------
COMMON STOCK - 91.5%
AUTO & TRANSPORTATION - 0.4%
1,300 Wabtec 48,789
-------------
CONSUMER DISCRETIONARY - 14.5%
4,300 Cheesecake Factory (1) 96,449
8,200 Corrections Corp. of America (1) 231,978
400 Heidrick & Struggles
International (1) 17,288
1,900 Lamar Advertising Class A 101,574
1,000 Meredith 62,250
2,100 Regis 70,560
5,000 Republic Services 170,950
700 Ritchie Brothers Auctioneers 52,381
4,400 Ross Stores 118,888
4,400 Scientific Games Class A (1) 159,060
700 Talbots 10,297
5,700 Valueclick (1) 154,983
8,600 VeriSign (1) 293,174
3,100 Watson Wyatt Worldwide Class A 147,777
-------------
1,687,609
CONSUMER STAPLES - 0.5%
2,400 Constellation Brands Class A (1) 60,288
-------------
FINANCIAL SERVICES - 14.5%
500 AllianceBernstein Holding LP 42,715
4,000 Annaly Capital Management REIT 68,360
1,000 Assurant 58,440
3,900 Bank of Hawaii 207,324
2,200 Checkfree (1) 104,566
4,900 Conseco (1) 77,371
3,200 Cullen/Frost Bankers 170,176
900 Dun & Bradstreet 87,165
2,100 Genpact (1) 33,600
2,100 Global Payments 99,876
3,500 Health Care REIT 155,015
4,800 Reinsurance Group of America 274,224
1,000 SVB Financial Group (1) 51,790
3,000 Westamerica Bancorporation 144,240
3,600 WR Berkley 108,324
-------------
1,683,186
HEALTH CARE - 13.6%
1,400 Advanced Medical Optics (1) 38,430
2,000 Amylin Pharmaceuticals (1) 90,040
5,200 Barr Pharmaceuticals (1) 298,064
4,700 DaVita (1) 306,393
2,500 Gen-Probe (1) 175,050
4,000 IMS Health 100,840
800 Invitrogen (1) 72,696
3,000 Medicis Pharmaceutical Class A 89,070
2,100 Millipore (1) 163,065
5,600 Perrigo 132,776
500 Techne (1) 32,620
2,000 West Pharmaceutical Services 82,680
-------------
1,581,724
Shares Value $
- ------------- --------------
MATERIALS & PROCESSING - 13.7%
1,500 Aber Diamond 65,895
600 Agnico-Eagle Mines 34,134
5,800 Albemarle 277,008
1,300 Cabot 45,513
8,800 Crown Holdings (1) 218,240
500 Fluor 79,000
2,800 FMC 161,000
2,400 Jacobs Engineering Group (1) 209,160
1,700 Lubrizol 115,396
2,900 Pan American Silver (1) 96,077
5,200 ShawCor 217,103
4,470 Yamana Gold (1) 67,139
-------------
1,585,665
OTHER ENERGY - 8.6%
1,700 Cameron International (1) 165,512
3,800 Concho Resources (1) 74,062
3,100 Denbury Resources (1) 175,460
8,300 Dresser-Rand Group (1) 321,210
5,800 Range Resources 260,594
-------------
996,838
PRODUCER DURABLES - 5.1%
4,200 Dover 193,200
4,450 IDEX 157,619
6,500 Tektronix 246,025
-------------
596,844
TECHNOLOGY - 16.1%
3,500 Adtran 84,245
8,600 Amdocs (1) 295,840
2,100 Amphenol Class A 92,967
16,600 Brocade Communications
Systems (1) 157,866
1,500 CommScope (1) 70,755
1,900 DRS Technologies 109,136
9,100 Emulex (1) 197,106
3,200 F5 Networks (1) 115,296
1,000 Harris 60,560
3,400 Integrated Device Technology (1) 45,662
5,800 Intersil Class A 175,972
3,500 IPG Photonics (1) 66,640
6,400 Parametric Technology (1) 122,240
11,900 QLogic (1) 184,807
4,800 SAIC (1) 94,608
-------------
1,873,700
UTILITIES - 4.5%
10,100 Citizens Communications 132,916
4,900 PNM Resources 122,549
5,500 Portland General Electric 154,825
4,900 Time Warner Telecom Class A (1) 113,876
-------------
524,166
-------------
TOTAL COMMON STOCK
(Cost $8,959,561) 10,638,809
-------------
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 44
- --------------------------------------------------------------------------------
SCHRODER U.S. SMALL AND MID CAP OPPORTUNITIES FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- ------------- --------------
SHORT-TERM
INVESTMENT - 8.4%
971,193 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 971,193
-------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $971,193) 971,193
-------------
TOTAL INVESTMENTS - 99.9%
(Cost $9,930,754) 11,610,002
-------------
OTHER ASSETS LESS
LIABILITIES - 0.1% 7,555
-------------
NET ASSETS - 100.0% $ 11,617,557
=============
(1) Denotes non-income producing security.
LP -- Limited Partnership
REIT -- Real Estate Investment Trust
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 45
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL ALPHA FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Shares Value $
- ------------- --------------
COMMON STOCK - 95.6%
BRAZIL - 2.2%
7,816 Unibanco - Uniao de Bancos
Brasileiros GDR 1,235,241
-------------
CANADA - 3.5%
9,171 Niko Resources 1,028,178
26,161 Nova Chemicals 951,410
-------------
1,979,588
CHINA - 4.7%
15,913 Alibaba.com (1) 27,719
1,410,000 Dongfeng Motor Group
Class H (4) 1,300,164
1,409,000 Industrial & Commercial
Bank of China Class H (4) 1,345,780
-------------
2,673,663
DENMARK - 2.0%
25,896 Danske Bank (4) 1,146,786
-------------
FRANCE - 9.6%
22,678 AXA (4) 1,018,729
8,173 Cie de Saint-Gobain (4) 880,917
17,774 Groupe Danone (4) 1,529,929
45,746 Natixis (4) 1,017,346
15,575 Suez (1) (4) 1,016,257
-------------
5,463,178
GERMANY - 9.9%
14,545 Adidas (4) 970,277
6,561 Deutsche Bank (1) (4) 872,462
53,863 Deutsche Telekom (4) 1,105,953
8,479 Linde (4) 1,074,550
11,663 Siemens (4) 1,581,638
-------------
5,604,880
GREECE - 1.7%
25,357 EFG Eurobank Ergasias (4) 989,572
-------------
HONG KONG - 3.4%
252,000 Shangri-La Asia (4) 804,257
78,000 Swire Pacific Class A (4) 1,114,007
-------------
1,918,264
JAPAN - 12.3%
247,000 Ebara (4) 1,165,895
28,000 Honda Motor (4) 1,048,739
23,900 Sony (4) 1,180,592
64,600 Sumitomo Electric Industries (4) 1,046,119
97 Sumitomo Mitsui
Financial Group (4) 794,731
110,000 Toray Industries (4) 849,354
44,900 Ushio (1) (4) 926,851
-------------
7,012,281
Shares Value $
- ------------- --------------
NETHERLANDS - 1.5%
20,062 Koninklijke Philips Electronics (4) 830,111
-------------
SINGAPORE - 4.1%
78,784 Jardine Strategic Holdings (4) 1,316,138
173,000 Keppel Land (1) (4) 1,000,948
-------------
2,317,086
SOUTH KOREA - 3.5%
16,359 Daewoo Shipbuilding &
Marine Engineering (4) 1,039,561
1,559 Samsung Electronics (4) 961,704
-------------
2,001,265
SWITZERLAND - 11.6%
3,457 Nestle (4) 1,597,139
26,074 Novartis (4) 1,387,348
6,832 Roche Holding (4) 1,167,230
66,644 STMicroelectronics (4) 1,141,931
5,440 Syngenta (4) 1,316,242
-------------
6,609,890
UNITED KINGDOM - 25.6%
49,681 Barclays (4) 628,667
87,280 BG Group (4) 1,617,943
66,098 Bunzl (4) 996,595
43,032 Northern Rock (4) 166,698
96,052 Rexam (4) 1,085,288
20,383 Rio Tinto (4) 1,911,061
92,891 Rolls-Royce Group (4) 1,041,940
3,757,504 Rolls-Royce Group B Shares 8,593
88,462 Royal Bank of Scotland Group (4) 955,212
33,038 SABMiller (4) 994,960
238,492 Sage Group (4) 1,203,262
138,102 Tesco (4) 1,404,599
84,737 Venture Production (4) 1,401,369
81,745 WPP Group (4) 1,118,155
-------------
14,534,342
-------------
TOTAL COMMON STOCK
(Cost $47,488,834) 54,316,147
-------------
EQUITY-LINKED
WARRANTS (2) - 3.6%
INDIA - 3.6%
72,702 Satyam Computer Services,
Expires 10/13/10 (1) (3) 884,291
235,809 Infrastructure Development
Finance Company
Expires 8/04/08 (1) (3) 1,156,643
-------------
TOTAL EQUITY-LINKED
WARRANTS
(Cost $1,535,715) 2,040,934
-------------
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 46
- --------------------------------------------------------------------------------
SCHRODER INTERNATIONAL ALPHA FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- ------------- --------------
SHORT-TERM INVESTMENT - 0.5%
276,936 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 276,936
-------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $276,936) 276,936
-------------
TOTAL INVESTMENTS - 99.7%
(Cost $49,301,485) 56,634,017
-------------
OTHER ASSETS LESS
LIABILITIES - 0.3% 157,457
-------------
NET ASSETS - 100.0% $ 56,791,474
=============
(1) Denotes non-income producing security.
(2) Securities are not readily marketable.
(3) Security exempt from registration under Rule 144A of the Securities Act of
1933. This security may be resold in transactions exempt from registration
normally to qualified institutions. On October 31, 2007, the value of
these securities amounted to $2,040,934, representing 3.6% of the net
assets of the Fund.
(4) Security is fair valued. (See Note 2 in Notes to Financial Statements.)
GDR -- Global Depositary Receipts
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 47
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKET EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
COMMON STOCK - 82.6%
BERMUDA - 0.3%
1,300 Credicorp 96,629
--------------
BRAZIL - 9.5%
10,800 All America Latina Logistica 171,181
2,700 B2W Companhia Global
Do Varejo (1) 145,878
11,000 Banco Bradesco ADR 375,650
7,900 Cia de Concessoes Rodoviarias 145,369
2,300 Empresa Brasileira de
Aeronautica ADR 112,171
1,009 MRV Engenharia e Participacoes (1) 21,007
9,400 Petroleo Brasileiro ADR 781,986
16,700 Tim Participacoes 115,925
2,500 Tim Participacoes ADR 116,000
3,400 Unibanco - Uniao de Bancos
Brasileiros GDR 537,336
898 Usinas Siderurgicas de
Minas Gerais 75,426
19,400 Weg 295,147
--------------
2,893,076
CHINA - 7.5%
324,000 China Construction
Bank Class H (4) 368,351
206,000 Dongfeng Motor Group
Class H (4) 189,953
2,400 Focus Media Holding ADR (1) 148,800
122,000 Golden Eagle Retail Group (4) 126,758
681,000 Industrial & Commercial
Bank of China Class H (4) 650,445
12,000 Parkson Retail Group (4) 136,961
700 PetroChina ADR (1) 183,820
33,500 Ping An Insurance
Group Class H (4) 468,940
--------------
2,274,028
COLOMBIA - 1.0%
25,700 Almacenes Exito
GDR (1) (2) (4) (5) 198,445
3,038 BanColombia ADR 111,646
--------------
310,091
EGYPT - 1.7%
4,451 Commercial International
Bank GDR 62,294
4,846 Orascom Hotels &
Development (1) (4) 63,651
104,946 Telecom Egypt (4) 378,710
--------------
504,655
HONG KONG - 9.8%
12,000 Beijing Enterprises Holdings (4) 74,644
69,000 China Mengniu Dairy (4) 293,127
61,000 China Mobile (4) 1,261,106
Shares Value $
- -------------- --------------
62,000 China Overseas Land
& Investment (4) 148,406
480,000 CNOOC (4) 1,037,354
222,000 Denway Motors (4) 156,662
--------------
2,971,299
HUNGARY - 0.8%
479 MOL Hungarian Oil & Gas (4) 74,236
731 Richter Gedeon (1) (4) 159,459
--------------
233,695
INDIA - 1.1%
1,700 ICICI Bank ADR 118,048
2,539 Infosys Technologies ADR 129,336
4,948 Mahindra & Mahindra GDR 94,931
--------------
342,315
INDONESIA - 1.6%
169,500 Bank Rakyat Indonesia (4) 146,470
300,000 Semen Gresik Persero (4) 206,718
99,000 Telekomunikasi Indonesia (4) 118,948
--------------
472,136
ISRAEL - 0.5%
54,753 Israel Discount Bank
Class A (1) (4) 139,861
--------------
MALAYSIA - 1.8%
86,200 AMMB Holdings (4) 109,845
38,200 Bumiputra-Commerce Holdings (4) 132,931
90,100 Genting (4) 224,395
32,000 SP Setia (4) 75,374
--------------
542,545
PHILIPPINES - 0.5%
25,200 First Philippine Holdings (1) (4) 50,596
1,600 Globe Telecom (4) 63,213
82,700 Robinsons Land (4) 40,162
--------------
153,971
RUSSIA - 11.4%
11,359 Comstar United
Telesystems GDR (1) (4) 139,555
5,700 LUKOIL ADR 515,850
850 MMC Norilsk Nickel ADR 262,650
4,400 Mobile Telesystems ADR 365,200
24,693 OAO Gazprom ADR (4) 1,234,532
1,078 Sberbank GDR (4) 535,605
6,722 Severstal GDR 159,984
3,550 TMK GDR 157,940
954 Uralkali GDR (1) 23,945
2,000 Vimpel-Communications ADR (1) 66,140
--------------
3,461,401
SOUTH AFRICA - 7.4%
5,261 AngloGold Ashanti (4) 247,225
13,449 Aveng (4) 133,390
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 48
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKET EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
5,101 Exxaro Resources (4) 83,285
16,183 FirstRand (4) 64,698
6,532 Gold Fields (4) 118,504
6,803 Group Five (4) 67,970
9,148 Impala Platinum Holdings (4) 347,227
9,544 MTN Group (4) 186,922
6,770 Naspers, N Shares (4) 216,265
10,868 Raubex Group (4) 60,275
19,911 Sanlam (1) (4) 73,425
6,074 Sasol (4) 311,922
12,629 Standard Bank Group (4) 230,224
4,374 Telkom (4) 120,261
--------------
2,261,593
SOUTH KOREA - 16.1%
1,282 Daelim Industrial (4) 281,844
3,156 Daewoo Shipbuilding &
Marine Engineering (4) 200,554
1,120 GS Engineering & Construction (4) 237,390
3,380 GS Holdings (4) 242,739
1,618 Hyundai Department Store (4) 226,446
1,434 Kookmin Bank (4) 117,317
2,529 Kookmin Bank ADR 206,594
16,660 Korea Exchange Bank (4) 275,671
2,918 LG Chem (4) 364,804
1,130 LG.Philips LCD (1) (4) 62,454
417 Lotte Shopping (4) 195,715
296 MegaStudy (4) 109,274
859 NHN (1) (4) 276,328
554 Orion (4) 177,093
409 POSCO (4) 298,389
12,130 Pusan Bank (4) 217,827
432 Samsung Electronics (4) 266,489
1,458 Samsung Electronics GDR (2) (4) 446,084
1,031 Samsung Fire &
Marine Insurance (4) 286,951
2,749 Samsung Heavy Industries (4) 166,039
291 Shinsegae (4) 229,381
--------------
4,885,383
TAIWAN - 6.4%
36,043 Advanced Semiconductor
Engineering ADR 216,979
9,802 AU Optronics ADR 212,998
9,742 Cathay Financial Holding GDR 251,668
210 China Steel GDR 5,911
13,084 Far EasTone
Telecommunications GDR 242,902
41,476 HON HAI Precision
Industry GDR 629,821
36,417 Taiwan Semiconductor
Manufacturing ADR 387,841
--------------
1,948,120
Shares Value $
- -------------- --------------
THAILAND - 3.8%
6,500 Banpu (4) 86,202
9,800 Banpu NVDR (4) 129,122
461,300 Land & Houses (4) 113,885
41,300 PTT Exploration &
Production (1) (4) 198,620
175,800 Siam Commercial Bank 489,196
53,100 Thai Oil (4) 151,328
--------------
1,168,353
TURKEY - 1.1%
14,189 KOC Holding (1) (4) 78,421
3,647 Otokar Otobus Karoseri Sanayi (4) 67,633
18,612 Turkiye Garanti Bankasi (4) 173,447
--------------
319,501
UNITED STATES - 0.3%
700 Southern Copper 97,790
--------------
TOTAL COMMON STOCK
(Cost $17,467,678) 25,076,442
--------------
PREFERRED STOCK - 5.6%
BRAZIL - 5.4%
9,800 Bradespar 306,976
26,780 Cia Vale do Rio Doce ADR 845,445
1,404,004 Eletropaulo Metropolitana
Eletricidade de Sao Paul (1) 108,425
16,412 Lojas Americanas 191,206
3,000 Ultrapar Participacoes 120,819
800 Usinas Siderurgicas de
Minas Gerais Class A 62,794
--------------
1,635,665
RUSSIA - 0.2%
1,100 Surgutneftegaz ADR 72,600
--------------
TOTAL PREFERRED STOCK
(Cost $925,057) 1,708,265
--------------
EQUITY-LINKED
WARRANTS (3) - 6.0%
CHINA - 0.6%
25,166 Shenzhen Development
Bank, Expires 1/02/09 (1) 163,164
--------------
SOUTH KOREA - 0.4%
165 Shinsegae, Expires 1/10/08 (2) 129,191
--------------
TAIWAN - 4.1%
40,016 Catcher Technology,
Expires 11/29/10 (2) 273,440
218,704 Chinatrust Financial
Holding, Expires 1/29/09 (1) (2) 159,282
99,687 Far Eastern Textile,
Expires 3/10/10 (2) 131,624
70,527 Formosa Chemicals &
Fibre, Expires 4/18/08 (2) 189,295
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 49
- --------------------------------------------------------------------------------
SCHRODER EMERGING MARKET EQUITY FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Shares Value $
- -------------- --------------
193 Largan Precision,
Expires 2/12/09 (1) (2) 2,393
11,897 Largan Precision,
Expires 9/12/08 (1) (2) 144,646
1,657 Largan Precision,
Expires 9/17/08 (1) (2) 20,146
179,765 Taiwan Cement,
Expires 1/20/09 (2) 304,702
15,327 TSRC, Expires
10/29/10 (1) (2) (4) (5) 23,963
--------------
1,249,491
UNITED ARAB EMIRATES - 0.9%
207,003 Air Arabia, Expires 8/13/10 (1) (2) 95,842
68,905 Aldar Properties,
Expires 1/12/10 (1) (2) 183,150
--------------
278,992
--------------
TOTAL EQUITY-LINKED
WARRANTS
(Cost $1,456,903) 1,820,838
--------------
INDEX-LINKED
WARRANTS (3) - 3.1%
INDIA - 1.3%
2,385 MSCI Daily Total Return
Net Emerging Markets India
Local, Expires 8/17/08 (1) (2) 32,317
125 MSCI Daily Total Return
Net Emerging Markets India
USD, Expires 10/25/08 (1) (4) (5) 78,399
478 MSCI Daily Total Return
Net Emerging Markets India
USD, Expires 4/20/08
(1) (2) (4) (5) 299,799
--------------
410,515
MALAYSIA - 0.3%
1,250 MSCI Daily Total Return
Malaysia Local, Expires
3/16/08 (1) (2) (4) (5) 98,370
--------------
TURKEY - 1.5%
322 MSCI Daily Total Return Net
Emerging Markets Turkey
USD, Expires 6/16/08
(1) (2) (4) (5) 117,245
360 MSCI Daily Total Return Net
Emerging Markets Turkey
USD, Expires 10/08/08 (1) (2) (4) (5) 131,082
278 MSCI Daily Total Return Net
Emerging Markets Turkey USD,
Expires 3/28/08 (1) (4) (5) 101,224
Shares Value $
- -------------- --------------
253 MSCI Daily Total Return Net
Emerging Markets Turkey USD,
Expires 5/05/08 (1) (2) (4) (5) 92,121
--------------
441,672
--------------
TOTAL INDEX-LINKED
WARRANTS
(Cost $750,060) 950,557
--------------
COLLECTIVE INVESTMENT
TRUST - 0.1%
CAYMAN ISLANDS - 0.1%
1,025 Dragon Capital-Vietnam
Growth Fund 37,700
--------------
TOTAL COLLECTIVE
INVESTMENT TRUST
(Cost $32,544) 37,700
--------------
Principal
Amount $
- --------------
SHORT-TERM
INVESTMENT - 2.7%
807,656 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 807,656
--------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $807,656) 807,656
--------------
TOTAL INVESTMENTS - 100.1%
(Cost $21,439,898) 30,401,458
--------------
OTHER ASSETS LESS
LIABILITIES - (0.1)% (33,097)
--------------
NET ASSETS - 100.0% $ 30,368,361
==============
(1) Denotes non-income producing security.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. This security may be resold in transactions exempt from registration
normally to qualified institutions. On October 31, 2007, the value of
these securities amounted to $3,073,137, representing 10.1% of the net
assets of the Fund.
(3) Securities are not readily marketable.
(4) Security is fair valued. (See Note 2 in Notes to Financial Statements.)
(5) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $1,140,648 representing 3.8% of the net assets of
the Fund.
ADR -- American Depositary Receipts
GDR -- Global Depositary Receipts
MSCI -- Morgan Stanley Capital International
NVDR -- Non-Voting Depositary Receipt
USD -- United States Dollar
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 50
- --------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
COLLATERALIZED MORTGAGE
OBLIGATIONS - 37.6%
1,277,652 American Home Mortgage Assets,
Series 2006-2, Class 1A1 (1)
5.893%, 9/25/46 1,249,704
1,586,280 American Home Mortgage
Investment Trust, Series 2005-1,
Class 1A1 (1)
5.093%, 6/25/45 1,545,674
149,906 American Home Mortgage
Investment Trust, Series 2005-SD1,
Class 2A1 (1) (2)
5.373%, 11/25/25 147,547
720,076 American Home Mortgage
Investment Trust, Series 2006-2,
Class 4A (1)
5.053%, 2/25/36 670,776
261,342 Banc of America Mortgage
Securities, Series 2003-K,
Class 2A2 (1)
4.474%, 12/25/33 266,738
306,358 Bayview Commercial Asset
Trust, Series 2004-3,
Class A1 (1) (2)
5.243%, 1/25/35 297,241
595,867 Bear Stearns Alternative Trust,
Series 2004-3, Class A1 (1)
5.193%, 4/25/34 588,052
782,011 Citigroup Mortgage Loan Trust,
Series 2003-UP3, Class A1
7.000%, 9/25/33 799,838
513,138 Citigroup Mortgage Loan Trust,
Series 2003-UP3, Class A2
7.000%, 9/25/33 527,760
835,457 Citigroup Mortgage Loan Trust,
Series 2004-2, Class 1A2 (2)
9.250%, 8/25/33 867,400
529,876 Citigroup Mortgage Loan Trust,
Series 2005-1, Class 3A1
6.500%, 4/25/35 539,365
327,348 Countrywide Alternative Loan
Trust, Series 2005-14, Class 2A1 (1)
5.083%, 5/25/35 324,604
3,078,041 Countrywide Alternative Loan
Trust, Series 2005-51, Class 3A2A (1)
6.223%, 11/20/35 3,030,884
1,494,813 Countrywide Alternative Loan
Trust, Series 2005-56, Class 2A3 (1)
6.433%, 11/25/35 1,486,405
1,345,330 Countrywide Alternative Loan
Trust, Series 2005-65CB, Class 1A7
5.500%, 1/25/36 1,344,921
Principal
Amount $ Value $
- -------------- --------------
73,611 Countrywide Alternative Loan
Trust, Series 2005-J4,
Class 1A1 (1)
5.163%, 7/25/35 72,274
243,483 Countrywide Alternative Loan
Trust, Series 2005-J4, Class 1A4 (1)
5.213%, 7/25/35 240,462
779,705 Countrywide Alternative Loan
Trust, Series 2006-HY12, Class A4 (1)
5.253%, 8/25/36 778,988
2,297,834 Countrywide Alternative Loan
Trust, Series 2006-J1, Class 1A6
5.500%, 2/25/36 2,290,785
916,371 Countrywide Alternative Loan
Trust, Series 2006-OA10, Class 1A1 (1)
5.893%, 8/25/46 905,060
402,771 Countrywide Home Loans,
Series 2005-11, Class 4A1 (1)
5.143%, 4/25/35 394,639
939,511 Deutsche Alt-A Securities,
Series 2006-AB1, Class A2A (1)
5.500%, 2/25/36 938,210
2,544,663 Greenpoint Mortgage Funding
Trust, Series 2005-AR5, Class 4A1 (1)
6.933%, 11/25/45 2,566,928
1,048,265 Harborview Mortgage Loan Trust,
Series 2005-12, Class 2A11 (1)
6.933%, 10/19/35 1,075,431
1,274,473 Impac CMB Trust, Series 2005-1,
Class 1A1 (1)
5.133%, 4/25/35 1,256,316
1,141,765 Impac CMB Trust, Series 2005-3,
Class A1 (1)
5.113%, 8/25/35 1,122,666
369,573 Impac CMB Trust, Series 2005-4,
Class 1A2 (1)
5.213%, 5/25/35 364,134
225,163 Impac Secured Assets, Series 2005-2,
Class A1M (1)
5.263%, 3/25/36 221,199
1,386,367 Indymac Index Mortgage Loan
Trust, Series 2006-AR9, Class 3A1 (1)
5.997%, 6/25/36 1,394,771
20,954,853 Lehman Brothers Small Balance
Commercial IO, Series 2005-1A,
Class A (2) (3) (7)
0.850%, 2/25/30 288,129
138,579 Master Adjustable Rate Mortgages
Trust, Series 2004-9, Class 2A1 (1)
5.253%, 11/25/34 136,264
324,068 Master Specialized Loan Trust,
Series 2006-2, Class A (1) (2)
5.133%, 2/25/36 312,235
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 51
- --------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
668,826 Residential Accredit Loans,
Series 2005-Q01, Class A2 (1)
6.483%, 8/25/35 666,004
1,960,967 Residential Accredit Loans,
Series 2005-Q02, Class A1 (1)
6.293%, 9/25/45 1,943,142
54,789 Structured Adjustable Rate
Mortgage, Series 2005-19X1,
Class A1 (2)
5.400%, 10/28/10 54,721
1,948,174 Structured Asset Mortgage
Investments, Series 2005-AR7,
Class 5A1 (1)
6.393%, 3/25/46 1,942,086
2,306,409 Structured Asset Mortgage
Investments, Series 2005-AR8,
Class A2 (1)
6.413%, 2/25/36 2,299,202
447,102 Structured Asset Securities,
Series 2005-GEL2, Class A (1)
5.153%, 4/25/35 430,587
955,200 Washington Mutual,
Series 2005-AR13, Class A1A2 (1)
6.383%, 10/25/45 947,588
2,851,962 Washington Mutual,
Series 2006-AR5, Class A1A (1)
5.923%, 6/25/46 2,802,164
1,330,396 Washington Mutual,
Series 2006-AR7, Class 1A (1)
5.913%, 7/25/46 1,307,374
426,500 Washington Mutual,
Series 2006-AR7, Class 2A (1)
5.913%, 7/25/46 419,020
1,443,478 Wells Fargo Mortgage-Backed
Securities, Series 2006-AR10,
Class 5A2 (1)
5.597%, 7/25/36 1,443,671
412,310 WMALT Mortgage Pass-Through
Certificates, Series 2005-5,
Class CB1 (1)
5.273%, 7/25/35 406,795
--------------
TOTAL COLLATERALIZED
MORTGAGE OBLIGATIONS
(Cost $43,485,977) 42,707,754
--------------
COMMERCIAL PAPER (5) - 26.8%
5,500,000 Bank of America
4.790%, 11/19/07 5,486,882
5,500,000 Barclays Capital
5.149%, 11/28/07 5,478,942
5,500,000 Citigroup Funding
4.981%, 11/13/07 5,490,925
5,000,000 General Electric Capital
4.709%, 12/12/07 4,973,350
Principal
Amount $ Value $
- -------------- --------------
5,000,000 Toyota Motor Credit
4.630%, 11/15/07 4,991,017
4,000,000 UBS Finance
5.350%, 11/07/07 3,996,460
--------------
TOTAL COMMERCIAL PAPER
(Cost $30,417,576) 30,417,576
--------------
MORTGAGE-BACKED
OBLIGATIONS - 17.8%
283,290 AAA Trust, Series 2005-1A,
Class 2A1 (1) (2)
5.099%, 2/27/35 277,796
84,630 Aames Mortgage Trust,
Series 2002-2, Class B (3) (4)
6.770%, 3/25/33 62,567
123,048 Ace Securities, Series 2004-FM1,
Class M2 (1) (3)
6.748%, 9/25/33 109,780
1,560,117 American Home Mortgage Assets,
Series 2006-3, Class 1A1 (1)
5.903%, 10/25/46 1,534,278
205,000 Ameriquest Mortgage Securities,
Series 2003-AR1, Class M3 (1) (3)
7.331%, 1/25/33 186,864
33,608 Asset-Backed Funding Certificates,
Series 2003-OPT1, Class M3 (1) (3)
6.773%, 9/25/32 31,688
1,090,913 Bayview Commercial Asset Trust,
Series 2005-3A, Class A1 (1) (2)
5.193%, 11/25/35 1,051,636
1,048,821 Bayview Commercial Asset Trust,
Series 2005-4A, Class A1 (1) (2)
5.173%, 1/25/36 1,006,868
742,973 Bear Stearns Asset-Backed Securities,
Series 2006-SD4, Class 3A1 (1)
5.913%, 10/25/36 676,105
382,131 CDC Mortgage Capital Trust,
Series 2003-HE3, Class M2 (1) (3)
6.623%, 11/25/33 354,812
1,387,947 Countrywide Alternative Loan
Trust, Series 2007-8CB, Class A1
5.500%, 5/25/37 1,380,521
50,708 Countrywide Asset-Backed
Certificates, Series 2005-17,
Class 4A2A (1)
5.133%, 5/25/36 49,884
53,379 Countrywide Asset-Backed
Certificates, Series 2006-11,
Class 1AF1 (1)
4.993%, 9/25/46 53,141
26,042 Countrywide Asset-Backed Certificates,
Series 2006-SD2, Class 2A1A (1) (2)
5.043%, 11/25/36 25,985
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 52
- --------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
230,774 Countrywide Asset-Backed Securities,
Series 2006-QH1, Class A1A (1) (2)
5.073%, 9/25/36 229,266
206,258 First National Loan Corporation Trust,
Series 2005-1, Class M2 (1)
5.303%, 5/25/35 194,406
46,129 Fremont NIM Trust,
Series 2005-B (2) (3) (7)
5.500%, 4/25/35 16,145
460,000 GMAC Mortgage Corporation
Loan Trust, Series 2004-HE2,
Class M1 (1)
3.950%, 10/25/33 429,921
853,192 Greenpoint Mortgage Funding
Trust, Series 2006-HE1, Class AX (1)
5.280%, 3/12/37 835,025
205,706 GRMT Mortgage Loan Trust,
Series 2001-1A, Class A5 (2)
6.650%, 7/20/31 205,093
21,904 Home Equity Asset Trust,
Series 2003-1, Class M3 (1) (3)
7.473%, 6/25/33 19,919
1,005,000 Impac Secured Assets Corporation,
Series 2006-3, Class A5M (1)
5.073%, 11/25/36 983,579
1,298,078 Indymac Index Mortgage Loan
Trust, Series 2006-AR13,
Class A1 (1)
6.079%, 7/25/36 1,306,485
536,182 Lake Country Mortgage Loan
Trust, Series 2005-HE1,
Class A2 (1) (2)
5.253%, 12/25/32 532,421
610,000 Master Asset-Backed Securities
Trust, Series 2006-FRE1,
Class A2 (1)
4.993%, 12/25/35 603,167
12,334 Master Asset-Backed Securities
NIM Trust, Series 2005-C10A,
Class N1 (2) (3) (6) (7)
4.750%, 5/26/35 603
593 Master Asset-Backed Securities
NIM Trust, Series 2005-CI9A,
Class N1 (2) (3) (7)
4.940%, 3/26/35 410
58,640 Master Asset-Backed Securities
NIM Trust, Series
2005-OPT1 (1) (2) (3) (7)
4.956%, 5/26/10 53,949
2,126 Master Asset-Backed Securities
NIM Trust, Series 2006-C15A,
Class N1 (2) (3) (7)
6.280%, 1/26/36 1,807
15,779 Option One Mortgage Loan
Trust, Series 2002-3, Class M2 (1)
6.568%, 8/25/32 12,944
Principal
Amount $ Value $
- -------------- --------------
8,454 Option One Mortgage Loan
Trust, Series 2002-3, Class M3 (1) (3)
7.648%, 8/25/32 3,214
160,782 Option One Mortgage Loan
Trust, Series 2003-1, Class M2 (1)
7.798%, 2/25/33 118,101
37,415 Option One Mortgage Loan
Trust, Series 2003-3, Class M2 (1)
6.473%, 6/25/33 33,230
518,636 Provident Bank Home Equity
Loan Trust, Series 1999-3, Class A3 (1)
5.263%, 1/25/31 510,287
2,321,058 Residential Accredit Loans,
Series 2007-QS5, Class A1
5.500%, 3/25/37 2,314,918
155,833 Sharps SP I LLC NIM Trust,
Series 2005-AS1N, Class NA (2) (3) (7)
7.380%, 9/25/35 15,583
26,559 Sharps SP I LLC NIM Trust,
Series 2005-HE4N, Class N (2) (3) (7)
5.250%, 7/25/35 8,615
206,869 Soundview Home Equity Loan
Trust, Series 2003-2, Class A2 (1)
5.514%, 11/25/33 197,697
1,300,000 Soundview Home Equity Loan
Trust, Series 2006-WF1, Class A2 (4)
5.645%, 10/25/36 1,280,929
1,412,696 Structured Asset Securities
Corporation, Series 2002-RM1,
Class A (1) (2)
5.523%, 10/25/37 1,410,930
219,742 Terwin Mortgage Trust,
Series 2006-4SL, Class A1 (1) (2)
4.500%, 5/25/37 208,248
1,918,439 Wells Fargo Mortgage-Backed
Securities, Series 2005-AR9,
Class 2A1 (1)
4.367%, 5/25/35 1,908,940
--------------
TOTAL MORTGAGE-BACKED
OBLIGATIONS
(Cost $20,813,694) 20,237,757
--------------
U.S. GOVERNMENT MORTGAGE-
BACKED OBLIGATIONS - 15.0%
FHLMC (1)
3,442,393 5.712%, 8/01/34 3,478,073
589,982 5.292%, 10/01/35 600,742
FNMA (1)
579,235 7.490%, 10/01/36 591,286
1,863,667 7.476%, 11/01/36 1,902,220
3,833,354 7.475%, 7/01/36 3,896,113
488,615 7.460%, 4/01/36 498,028
808,046 7.431%, 10/01/36 823,697
591,538 7.385%, 9/01/36 602,422
187,167 7.289%, 8/01/36 190,093
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 53
- --------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
1,171,934 6.985%, 10/01/35 1,201,818
1,017,715 6.949%, 11/01/35 1,043,600
2,208,299 4.115%, 4/01/34 2,197,682
--------------
TOTAL U.S. GOVERNMENT
MORTGAGE-BACKED
OBLIGATIONS
(Cost $17,073,668) 17,025,774
--------------
ASSET-BACKED SECURITIES - 2.6%
68,110 Amortizing Residential Collateral
Trust, Series 2002-BC1, Class M1 (1)
5.723%, 1/25/32 58,266
400,242 Aspen Funding I, Ltd., Series 2002-1A,
Class A1L (1) (2)
5.853%, 7/10/37 360,218
11,538 Countrywide Asset-Backed Certificates,
Series 2003-1, Class B (1) (3)
10.755%, 9/25/32 8,152
104,955 Countrywide Asset-Backed
Certificates, Series 2003-1,
Class M1 (1)
5.998%, 4/25/33 86,555
96,310 Countrywide Asset-Backed
Certificates, Series 2003-3, Class 3A (1)
5.143%, 11/25/33 94,608
115,667 Countrywide Asset-Backed
Certificates, Series 2004-SD3,
Class A2 (1) (2)
5.423%, 9/25/34 109,973
9,625 Countrywide Asset-Backed
Certificates, Series 2005-2N,
Class N (2) (3) (7)
4.500%, 8/25/36 8,942
480,000 Countrywide Asset-Backed
Certificates, Series 2005-5,
Class M4 (1)
5.673%, 10/25/35 436,474
65,480 Countrywide Asset-Backed
Certificates, Series 2005-9N,
Class N (2) (3) (6) (7)
5.500%, 10/25/36 9,822
51,316 Countrywide Asset-Backed
Certificates, Series 2005-
AB5N (2) (3) (7)
6.000%, 12/29/36 25,754
329,340 Countrywide Home Equity
Loan Trust, Series 2003-C, Class A (1)
5.361%, 5/15/29 324,545
64,499 Credit Suisse First Boston
Mortgage Securities,
Series 2005-AGE1, Class A1 (1)
5.013%, 2/25/32 64,479
Principal
Amount $ Value $
- -------------- --------------
9,579 GSAMP Trust, Series 2004-
WFN (2) (3) (6) (7)
5.000%, 10/25/34 1,437
493,185 Lehman XS Trust,
Series 2006-12N, A1A1 (1)
4.953%, 8/25/46 489,755
108,646 Saco I Trust, Series 2005-2,
Class A (1) (2)
5.073%, 4/25/35 99,916
54,178 Structured Asset Investment
Loan Trust, Series 2003-BC1,
Class M2 (1) (3)
7.648%, 1/25/33 51,867
99,741 Structured Asset Investment
Loan Trust, Series 2003-BC11,
Class M4 (1) (3)
7.873%, 10/25/33 44,271
111,237 Structured Asset Investment
Loan Trust, Series 2003-BC2,
Class M1 (1)
5.793%, 4/25/33 102,873
160,000 Structured Asset Investment
Loan Trust, Series 2003-BC7,
Class M1 (1)
5.623%, 7/25/33 157,049
63,810 Structured Asset Investment
Loan Trust, Series 2004-1,
Class M4 (1) (3)
7.623%, 2/25/34 19,693
405,364 Wachovia Loan Trust,
Series 2005-SD1, Class A (1) (2)
5.233%, 5/25/35 392,930
--------------
TOTAL ASSET-BACKED
SECURITIES
(Cost $3,308,497) 2,947,579
--------------
CORPORATE OBLIGATION - 0.2%
300,000 Twin Reefs Pass-Through (1) (2)
6.120%, 12/10/09 258,807
--------------
TOTAL CORPORATE
OBLIGATION
(Cost $300,381) 258,807
--------------
SHORT-TERM INVESTMENT- 0.5%
588,983 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 588,983
--------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $588,983) 588,983
--------------
TOTAL INVESTMENTS - 100.5%
(Cost $115,988,776) 114,184,230
--------------
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 54
- --------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Value $
--------------
OTHER ASSETS LESS
LIABILITIES - (0.5)% (600,646)
--------------
NET ASSETS - 100.0% $ 113,583,584
==============
(1) Variable Rate Security -- Rate disclosed is as of October 31, 2007.
(2) Security exempt from registration under Rule 144A of the Securities Act of
1933. This security may be resold in transactions exempt from registration
normally to qualified institutions. On October 31, 2007, the value of
these securities amounted to $8,280,427, representing 7.3% of the net
assets of the Fund.
(3) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $1,324,023, representing 1.2% of the net assets of
the Fund.
(4) Step Bond -- Coupon rate increases in increments to maturity. Rate
disclosed is as of October 31, 2007.
(5) The rate shown represents the security's effective yield at time of
purchase.
(6) Security is fair valued. (See Note 2 in Notes to Financial Statements.)
(7) Security considered restricted. (See Note 2 in Notes to Financial
Statements.)
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
IO -- Interest Only Security - principal amount represents notional amount.
LLC -- Limited Liability Company
Ltd. -- Limited
NIM -- Net Interest Margin
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 55
- --------------------------------------------------------------------------------
SCHRODER STRATEGIC BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Principal
Amount (a) Value $
---------- ------------
COMMERCIAL PAPER (5) - 26.2%
Bank Nederlandse Gemeenten
1,000,000 4.910%, 11/02/07 999,864
1,000,000 4.485%, 12/03/07 996,153
1,000,000 European Investment Bank
4.650%, 11/02/07 999,872
KFW International Finance
1,000,000 4.690%, 11/02/07 999,870
1,000,000 4.440%, 12/03/07 996,191
Rabobank
1,000,000 4.880%, 11/02/07 999,865
1,000,000 4.569%, 12/03/07 996,080
1,000,000 Republic of Austria
4.310%, 12/03/07 996,302
1,000,000 Reseau Ferre
4.850%, 11/02/07 999,866
------------
TOTAL COMMERCIAL PAPER
(Cost $8,984,063) 8,984,063
------------
U.S. GOVERNMENT MORTGAGE-
BACKED OBLIGATIONS - 23.3%
1,000,000 FFCB (2)
4.374%, 11/05/07 999,510
3,669 FHLMC
5.500%, 7/01/37 3,612
2,185,272 FHLMC Gold
5.000%, 5/01/37 2,098,182
2,476,036 FNMA
5.000%, 1/01/22 2,438,108
2,500,000 FNMA TBA
5.000%, 11/25/22 2,461,328
------------
TOTAL U.S. GOVERNMENT
MORTGAGE-BACKED
OBLIGATIONS
(Cost $7,913,212) 8,000,740
------------
U.S. TREASURY
OBLIGATIONS (6) - 20.9%
4,270,000 U.S. Treasury Bonds
5.125%, 5/15/16 4,481,498
U.S. Treasury Notes
200,000 4.750%, 8/15/17 204,469
80,000 4.750%, 2/15/37 79,981
1,985,000 4.625%, 7/31/12 2,025,319
110,000 4.250%, 9/30/12 110,464
270,000 4.125%, 8/31/12 269,810
------------
TOTAL U.S. TREASURY
OBLIGATIONS
(Cost $7,076,673) 7,171,541
------------
Principal
Amount (a) Value $
---------- ------------
FOREIGN BONDS - 16.6%
100,000 Credit Suisse
8.000%, 2/22/10 99,755
EGP 950,000 Egypt Treasury Bill (2)
7.100%, 1/15/08 170,140
120,000 Export Import Bank of Ukraine
7.650%, 9/07/11 121,860
EUR 140,000 German Treasury Bill (2)
3.755%, 12/12/07 201,953
EUR 310,000 Kingdom of Morocco
5.000%, 7/08/08 450,627
100,000 Majapahit Holding
7.250%, 10/17/11 101,866
MYR 2,350,000 Malaysian Government
3.869%, 4/13/10 711,509
MXP 8,610,000 Mexican Fixed Rate Bond
10.000%, 12/05/24 974,908
EUR 60,000 NXP Funding LLC (3)
7.482%, 10/15/13 81,055
62,813 Republic of Argentina Series V
7.000%, 3/28/11 60,128
BRL 297,000 Republic of Brazil
10.250%, 1/10/28 172,372
200,000 RSHB Capital
6.875%, 11/29/10 203,013
SEK 12,145,000 Swedish Government
5.500%, 10/08/12 2,016,579
VTB Capital Series E, MTN (3)
EUR 170,000 5.350%, 3/13/09 243,079
EUR 70,000 4.250%, 2/15/16 96,113
------------
TOTAL FOREIGN BONDS
(Cost $5,612,836) 5,704,957
------------
CORPORATE
OBLIGATIONS (6) - 8.3%
140,000 Adaro Finance
8.500%, 12/08/10 149,760
25,000 AGY Holdings (4)
11.000%, 11/15/14 24,750
50,000 AK Steel
7.750%, 6/15/12 51,250
25,000 American Media Operation Series B
10.250%, 5/01/09 24,000
75,000 Avnet
6.625%, 9/15/16 77,683
20,000 Belden
7.000%, 3/15/17 20,400
20,000 Broadview Networks Holdings (4)
11.375%, 9/01/12 21,300
45,000 Buffalo Thunder Development
Authority (4)
9.375%, 12/15/14 42,300
100,000 Centercredit International (4)
8.625%, 1/30/14 87,500
60,000 Chesapeake Energy
7.000%, 8/15/14 60,600
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 56
- --------------------------------------------------------------------------------
SCHRODER STRATEGIC BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount (a) Value $
---------- ------------
70,000 Claymont Steel
8.875%, 2/15/15 66,150
35,000 CRC Health
10.750%, 2/01/16 37,275
20,000 Dynegy Holdings (4)
7.750%, 6/01/19 18,875
77,486 Elwood Energy LLC
8.159%, 7/05/26 79,797
100,000 Empire Capital Resources (4)
9.375%, 12/15/11 107,250
Enterprise Products Operations (3)
45,000 8.375%, 8/01/66 46,915
40,000 7.034%, 1/15/68 36,828
95,000 Erac USA Finance (4)
7.000%, 10/15/37 93,775
10,000 Ford Motor
7.450%, 7/16/31 7,900
Freeport-McMoRan
60,000 8.375%, 4/01/17 65,850
10,000 8.250%, 4/01/15 10,825
25,000 General Cable (3)
7.606%, 4/01/15 24,813
200,000 Goldman Sachs Group
6.750%, 10/01/37 201,399
25,000 Hornbeck Offshore Service Series B
6.125%, 12/01/14 23,938
430,000 HSBC Holdings
6.500%, 9/15/37 427,425
50,000 Lyondell Chemical
6.875%, 6/15/17 55,250
55,000 MarkWest Energy Partners
8.500%, 7/15/16 55,275
40,000 Mosaic (4)
7.375%, 12/01/14 42,500
35,000 Neff
10.000%, 6/01/15 25,375
25,000 Nevada Power Series O
6.500%, 5/15/18 26,151
20,000 NRG Energy
7.375%, 1/15/17 19,950
25,000 Penske Auto Group
7.750%, 12/15/16 24,438
75,000 Petroplus Finance (4)
7.000%, 5/01/17 70,875
30,000 PNA Group
10.750%, 9/01/16 30,825
15,000 Residential Capital LLC (3)
7.800%, 11/21/08 12,656
10,000 Reynolds American
7.625%, 6/01/16 10,869
30,000 RSC Equipment Rental
9.500%, 12/01/14 28,987
45,000 San Pasqual Casino (4)
8.000%, 9/15/13 45,675
Principal
Amount (a) Value $
---------- ------------
Seagate Technology Holding
45,000 6.800%, 10/01/16 44,437
20,000 6.375%, 10/01/11 19,950
15,000 Senior Housing Trust REIT
8.625%, 1/15/12 16,275
20,000 Snoqualmie (4)
9.125%, 2/01/15 19,750
30,000 Spansion LLC (3) (4)
8.746%, 6/01/13 28,575
35,000 Stallion Oilfield (4)
9.750%, 2/01/15 33,250
55,000 Stena
7.500%, 11/01/13 55,000
300,000 Stingray Pass Through Trust (4)
5.902%, 1/12/15 222,383
50,000 Sunstate Equipment (4)
10.500%, 4/01/13 48,250
20,000 Teppco Partners (3)
7.000%, 6/01/67 18,118
25,000 Vitamin Shoppe (3)
13.058%, 11/15/12 26,250
55,000 Williams Series A
7.500%, 1/15/31 58,300
------------
TOTAL CORPORATE
OBLIGATIONS
(Cost $2,942,737) 2,847,922
------------
MORTGAGE-BACKED
OBLIGATIONS - 6.2%
370,000 Bear Stearns Commercial Mortgage
Securities, Series 2006-T22,
Class A4 (3)
5.466%, 4/12/38 370,960
766,255 Countrywide Alternative Loan
Trust, Series 2007-25, Class 1A2
6.500%, 11/25/37 761,226
EUR 81,246 Gracechurch Card PLC,
Series 2006-A, Class A1 (3)
6.707%, 10/15/12 115,547
56,261 Master Asset-Backed Securities
NIM Trust, Series 2006-CI23,
Class N1 (1) (4) (7)
7.250%, 8/25/36 6,751
8,648 Meritage Mortgage Loan Trust,
Series 2004-1, Class B1 (1) (3) (4) (7)
10.381%, 7/25/34 134
11,014 New Century Home Equity Loan
Trust, Series 2003-3, Class M5 (3) (7)
7.205%, 7/25/33 3,058
28,000 Park Place Securities, Series 2004-
WCW1, Class N8 (3) (7)
8.373%, 9/25/34 19,883
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 57
- --------------------------------------------------------------------------------
SCHRODER STRATEGIC BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount (a) Value $
---------- ------------
47,865 Sharps SP I LLC NIM Trust,
Series 2006-HE3N,
Class NA (1) (4) (7)
6.400%, 6/25/36 1,915
870,000 Wachovia Bank Commercial
Mortgage Trust, Series 2007-C30,
Class A5
5.342%, 12/15/43 850,448
------------
TOTAL MORTGAGE-BACKED
OBLIGATIONS
(Cost $2,220,416) 2,129,922
------------
COLLATERALIZED MORTGAGE
OBLIGATION - 0.4%
160,000 Morgan Stanley Capital I,
Series 2003-T11, Class A3
4.850%, 6/13/41 158,887
------------
TOTAL COLLATERALIZED
MORTGAGE OBLIGATION
(Cost $156,368) 158,887
------------
SHORT-TERM INVESTMENT - 13.9%
4,760,871 JPMorgan Chase Bank,
N.A. Time Deposit (Nassau),
4.44% 4,760,871
------------
TOTAL SHORT-TERM INVESTMENT
(Cost $4,760,871) 4,760,871
------------
TOTAL INVESTMENTS - 115.8%
(Cost $39,667,176) 39,758,903
------------
OTHER ASSETS LESS
LIABILITIES - (15.8)% (5,437,193)
------------
NET ASSETS - 100.0% $ 34,321,710
============
(a) Principal amount denominated in U.S. dollars unless otherwise indicated.
(1) Security considered restricted. (See Note 2 in Notes to Financial
Statements.)
(2) Zero Coupon Security -- Rate disclosed is the effective yield at time of
purchase.
(3) Variable Rate Security -- Rate disclosed is as of October 31, 2007.
(4) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally to qualified institutions. On October 31, 2007, the
value of these securities amounted to $915,808, representing 2.7% of the
net assets of the Fund.
(5) The rate shown represents the security's effective yield at time of
purchase.
(6) Security, or portion of security, has been pledged as collateral on open
derivative positions and mortgage dollar rolls.
(7) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $31,741 representing 0.1% of the net assets of the
Fund.
BRL -- Brazilian Real
CZK -- Czech Koruna
EGP -- Egyptian Pound
EUR -- Euro
Euribor -- Euro Inter-Bank Offered Rate
FFCB -- Federal Farm Credit Bank
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
GBP -- British Pound Sterling
LLC -- Limited Liability Company
LIBOR -- London InterBank Offered Rate
MTN -- Medium Term Note
MXP -- Mexican New Peso
MYR -- Malaysian Ringgit
NIM -- Net Interest Margin
PLC -- Public Limited Company
PLZ -- Polish Zloty
PRIBOR -- Prague InterBank Offered Rate
REIT -- Real Estate Investment Trust
SEK -- Swedish Krona
TBA -- To Be Announced
USD -- United States Dollar
WIBOR -- Warsaw InterBank Offered Rate
- --------------------------------------------------------------------------------
FUTURES CONTRACTS:
The Fund had the following futures contracts outstanding as of October 31, 2007:
NET
NUMBER UNREALIZED
OF EXPIRATION APPRECIATION
CONTRACTS VALUE DATE (DEPRECIATION)
- --------------------------------------------------------------------------------
LONG:
3-Month
Euribor 74 $ 25,616,498 Mar-08 $ (32,677)
U.S. Treasury
5 Year Note 103 11,056,406 Dec-07 42,700
Euro-Bund 7 1,149,275 Dec-07 9,355
U.S. Treasury
10 Year Note 4 440,063 Dec-07 4,682
---------
24,060
SHORT:
Euro-Bobl 14 2,184,565 Dec-07 6,383
Euro-Schatz 1 149,521 Dec-07 254
U.S. Treasury
5 Year Note 3 322,031 Dec-07 (1,293)
U.S. Treasury
10 Year Note 27 2,970,422 Dec-07 16,586
U.S. Long
Bond 10 1,125,938 Dec-07 (19,233)
---------
2,697
---------
$ 26,757
=========
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 58
- --------------------------------------------------------------------------------
SCHRODER STRATEGIC BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
- --------------------------------------------------------------------------------
FORWARD FOREIGN CURRENCY CONTRACTS:
The Fund had the following forward foreign currency contracts outstanding at
October 31, 2007:
NET UNREALIZED
SETTLEMENT APPRECIATION
DATE CURRENCY TO DELIVER CURRENCY TO RECEIVE (DEPRECIATION)
- --------------------------------------------------------------------------------
1/11/08 USD 139,942 EUR 98,000 $ 2,150
11/26/07 USD 709,390 MYR 2,370,000 2,416
1/11/08 EUR 359,037 USD 509,000 (11,575)
1/11/08 EUR 1,079,228 USD 1,530,000 (34,794)
11/26/07 MYR 2,370,000 USD 701,495 (10,311)
1/11/08 SEK 13,000,000 USD 2,036,232 (13,594)
1/11/08 MXP 10,660,000 USD 988,873 (6,590)
---------
$ (72,298)
=========
A summary of the outstanding Credit Default Swap agreements held by the Fund at
October 31, 2007 is as follows:
NET UNREALIZED
EXPIRATION NOTIONAL APPRECIATION
DESCRIPTION DATE AMOUNT (DEPRECIATION)
- ------------------------------------------------------------------------------------------------------------------------------
Fund pays quarterly 0.085% (0.34% per annum) times notional amount of Altria
Group, Inc. 7.00% 11/4/13. Upon a defined credit event the Fund receives
notional amount and makes delivery of a defined deliverable obligation.
(Counterparty: Morgan Stanley) 9/20/12 $ 125,000 $ (208)
Fund pays quarterly 0.0875% (0.35% per annum) times notional amount of CDX IG
Index Series 8. Upon a defined credit event the Fund receives notional amount
and makes delivery of a defined deliverable obligation. (Counterparty: Morgan
Stanley) 6/20/12 $ 100,000 (810)
Fund pays quarterly 0.13% (0.52% per annum) times notional amount of CenturyTel,
Inc. 7.875% 8/15/12. Upon a defined credit event the Fund receives notional
amount and makes delivery of a defined deliverable obligation. (Counterparty:
Royal Bank of Scotland) 9/20/12 $ 115,000 (436)
Fund receives quarterly payment of 0.14125% (0.565% per annum) times notional
amount of Fiat Finance & Trade 6.625% 2/15/13. Upon a defined credit event the
Fund pays notional amount and takes receipt of a defined deliverable
obligation. (Counterparty: Lehman Brothers) 9/20/12 EUR 125,000 154
Fund receives quarterly payment of 1.5625% (6.25% per annum) times notional
amount of Ford Motor Company 6.50% 8/1/18. Upon a defined credit event the
Fund pays notional amount and takes receipt of a defined deliverable
obligation. (Counterparty: JP Morgan) 9/20/08 $ 100,000 3,268
Fund receives quarterly 1.0375% (4.15% per annum) times notional amount of
General Motors Corp. 7.125% 7/15/13. Upon a defined credit event the Fund pays
notional amount and takes receipt of a defined deliverable obligation.
(Counterparty: Lehman Brothers) 9/20/08 $ 150,000 2,293
Fund pays quarterly 0.9375% (3.75% per annum) times notional amount of iTraxx
Europe Crossover 5 Year Index Series 8. Upon a defined credit event the Fund
receives notional amount and makes delivery of a defined deliverable
obligation. (Counterparty: JP Morgan) 12/20/12 EUR 250,000 12,111
Fund receives quarterly 0.7875% (3.15% per annum) times notional amount of
Nordic Telephone Company Holdings 8.25% 5/1/16. Upon a defined credit event
the Fund pays notional amount and takes receipt of a defined deliverable
obligation. (Counterparty: Lehman Brothers) 9/20/12 EUR 35,000 359
Fund receives semi-annually 1.135% (2.27% per annum) times notional amount of
Republic of Argentina 8.28% 12/31/33. Upon a defined credit event the Fund
pays notional amount and takes receipt of a defined deliverable obligation.
(Counterparty: JP Morgan) 11/20/11 $ 53,000 (1,491)
Fund receives semi-annually 1.765% (3.53% per annum) times notional amount of
Republic of Argentina 8.28% 12/31/33. Upon a defined credit event the Fund
pays notional amount and takes receipt of a defined deliverable obligation.
(Counterparty: Lehman Brothers) 10/20/12 $ 310,000 110
Fund receives quarterly 0.17% (0.68% per annum) times notional amount of
Reynolds American Inc. 7.625% 6/1/16. Upon a defined credit event the Fund
pays notional amount and takes receipt of a defined deliverable obligation.
(Counterparty: Morgan Stanley) 6/20/12 $ 75,000 299
Fund receives quarterly 0.9375% (3.75% per annum) times notional amount of
Univision Communications Inc. 7.85% 7/15/11. Upon a defined credit event the
Fund pays notional amount and takes receipt of a defined deliverable
obligation. (Counterparty: Lehman Brothers) 9/20/08 $ 150,000 2,886
-------
$18,535
=======
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 59
- --------------------------------------------------------------------------------
SCHRODER STRATEGIC BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
A summary of the outstanding Interest Rate Swap agreements held by the Fund at
October 31, 2007 is as follows:
NET UNREALIZED
EXPIRATION NOTIONAL APPRECIATION
DESCRIPTION DATE AMOUNT (DEPRECIATION)
- ---------------------------------------------------------------------------------------------------------------------------------
Receive fixed rate of 3.85% and pay floating rate based on 6-month CZK PRIBOR.
(Counterparty: JP Morgan) 10/24/09 CZK 120,230,000 $(11,147)
Receive fixed rate of 4.225% and pay floating rate based on 6-month CZK PRIBOR.
(Counterparty: JP Morgan) 10/18/12 CZK 43,790,000 10,038
Receive floating rate based on 6-month CZK PRIBOR and pay fixed rate of 4.32%.
(Counterparty: JP Morgan) 10/24/17 CZK 22,400,000 3,689
Receive fixed rate of 5.9125% and pay floating rate based on 6-month GBP LIBOR.
(Counterparty: Royal Bank of Scotland) 10/11/09 GBP 6,380,000 33,494
Receive floating rate based on 6-month GBP LIBOR and pay fixed rate of 5.475%.
(Counterparty: Royal Bank of Scotland) 10/11/17 GBP 1,240,000 (13,209)
Receive floating rate based on 6-month PLZ WIBOR and pay fixed rate of 5.705%.
(Counterparty: JP Morgan) 10/18/12 PLZ 6,280,000 (12,731)
--------
$ 10,134
========
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 60
- --------------------------------------------------------------------------------
SCHRODER TOTAL RETURN FIXED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
U.S. GOVERNMENT MORTGAGE-
BACKED OBLIGATIONS - 27.4%
FHLMC
415,091 6.500%, 7/01/32 427,596
2,407,745 5.500%, 6/01/37 2,346,343
FHLMC Gold
31,831 6.000%, 12/01/28 32,267
296,718 5.500%, 12/01/34 292,756
667,022 5.000%, 7/01/33 641,970
2,223,494 5.000%, 8/01/33 2,139,987
2,313 5.000%, 5/01/37 2,221
312,220 4.500%, 3/01/19 302,323
64 FHLMC IO (3)
565.200%, 1/15/22 783
FNMA
145,585 7.500%, 12/01/29 154,435
18,287 7.000%, 12/01/10 18,487
38,682 6.000%, 12/01/28 39,244
180,336 6.000%, 12/01/28 182,958
314,382 6.000%, 10/01/29 318,802
319,384 5.500%, 10/01/32 315,699
368,365 5.500%, 1/01/33 364,114
2,902,422 5.500%, 7/01/33 2,868,286
1,187,525 5.500%, 7/01/34 1,172,744
1,629,048 5.000%, 1/01/22 1,604,094
720,038 4.500%, 10/01/33 672,584
125,000 4.250%, 5/15/09 124,787
GNMA
34,556 8.000%, 11/15/17 36,463
24,028 8.000%, 6/15/26 25,567
160,187 7.000%, 9/15/23 168,890
3,951,037 6.000%, 9/20/37 3,990,070
559,118 5.500%, 1/15/34 556,128
264,777 5.500%, 9/20/34 261,955
701,168 5.500%, 1/15/35 697,207
--------------
TOTAL U.S. GOVERNMENT
MORTGAGE-BACKED
OBLIGATIONS
(Cost $19,643,264) 19,758,760
--------------
U.S. TREASURY
OBLIGATIONS (4) - 21.5%
U.S. Treasury Notes
1,945,000 4.750%, 8/15/17 1,988,459
1,180,000 4.750%, 2/15/37 1,179,724
5,009,000 4.250%, 9/30/12 5,031,701
230,000 4.250%, 8/15/14 229,569
7,110,000 4.000%, 8/31/09 7,117,224
--------------
TOTAL U.S. TREASURY
OBLIGATIONS
(Cost $15,481,654) 15,546,677
--------------
Principal
Amount $ Value $
- -------------- --------------
COMMERCIAL PAPER (5) - 18.7%
3,000,000 Barclays Capital
5.149%, 11/28/07 2,988,514
2,500,000 Citigroup Funding
4.981%, 11/13/07 2,495,875
3,500,000 Deutsche Bank
4.790%, 11/01/07 3,500,000
3,000,000 General Electric Capital
4.750%, 12/12/07 2,983,873
1,500,000 UBS Finance
5.308%, 11/07/07 1,498,683
--------------
TOTAL COMMERCIAL PAPER
(Cost $13,466,945) 13,466,945
--------------
CORPORATE OBLIGATIONS - 15.7%
370,000 American Capital Strategy
6.850%, 8/01/12 381,217
145,000 American General Finance MTN
5.750%, 9/15/16 142,377
45,000 Assured Guaranty
7.000%, 6/01/34 48,759
345,000 Assured Guaranty, Series A (2)
6.400%, 12/15/66 339,283
70,000 Avnet
6.625%, 9/15/16 72,504
85,000 BBVA International (1) (2)
5.919%, 4/18/17 78,477
285,000 BellSouth
4.750%, 11/15/12 280,410
165,000 Burlington North Santa Fe
6.150%, 5/01/37 163,557
100,000 Centercredit International (1)
8.625%, 1/30/14 87,500
100,000 Chukchansi Economic Development (1) (2)
8.859%, 11/15/12 100,500
160,000 Cisco Systems
5.500%, 2/22/16 160,885
295,000 Citigroup
5.125%, 2/14/11 295,447
190,000 Cleveland Electric Illumination
5.700%, 4/01/17 186,016
345,000 Colonial Realty LP
5.500%, 10/01/15 324,062
200,000 Colorado Interstate Gas
6.800%, 11/15/15 208,635
320,000 Corp. Andina de Fomento
5.750%, 1/12/17 315,622
280,000 Credit Suisse USA
5.500%, 8/16/11 283,471
100,000 CSX
6.150%, 5/01/37 95,368
85,000 Enterprise Products Operations (2)
8.375%, 8/01/66 88,617
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 61
- --------------------------------------------------------------------------------
SCHRODER TOTAL RETURN FIXED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
205,000 Erac USA Finance (1)
7.000%, 10/15/37 202,356
60,000 FTI Consulting
7.625%, 6/15/13 62,100
125,000 Gaz Capital (1)
6.212%, 11/22/16 123,562
175,000 General Electric Capital MTN
5.625%, 9/15/17 177,038
165,000 General Electric Capital MTN, Series A
5.875%, 2/15/12 170,066
75,000 Gerdau Ameristeel
10.375%, 7/15/11 79,313
Goldman Sachs Group
300,000 6.750%, 10/01/37 302,098
260,000 5.450%, 11/01/12 261,834
115,000 Greif
6.750%, 2/01/17 114,712
480,000 GTL Trade Finance (1)
7.250%, 10/20/17 486,114
135,000 Health Care REIT
6.200%, 6/01/16 130,401
155,000 Hospitality Property Trust REIT
5.625%, 3/15/17 145,472
500,000 HSBC Holdings
6.500%, 9/15/37 497,006
100,000 Icici Bank Limited (1)
6.625%, 10/03/12 100,905
105,000 Industrial Bank of Korea (1) (2)
4.000%, 5/19/14 103,492
215,000 ITC Holdings (1)
5.875%, 9/30/16 215,443
155,000 JC Penney
7.400%, 4/01/37 166,022
70,000 Korea Development Bank
3.875%, 3/02/09 68,723
380,000 Lehman Brothers Holdings
6.500%, 7/19/17 383,388
185,000 Lehman Brothers Holdings MTN
5.250%, 2/06/12 182,681
240,000 Magellan Misdstream Partners
6.400%, 5/01/37 238,894
125,000 Nevada Power
5.875%, 1/15/15 126,019
255,000 NXP Funding LLC
7.875%, 10/15/14 250,219
245,000 Oneok Partners LP
6.150%, 10/01/16 248,434
100,000 Petroplus Finance (1)
6.750%, 5/01/14 95,500
250,000 Ras Laffan Liquefied Natural Gas II (1)
5.298%, 9/30/20 241,975
185,000 Residential Capital LLC (2)
7.800%, 11/21/08 156,094
260,000 Reynolds America
7.250%, 6/15/37 277,730
Principal
Amount $ Value $
- -------------- --------------
195,000 Reynolds American
7.625%, 6/01/16 211,949
125,000 Safeway
6.350%, 8/15/17 129,638
280,000 Senior Housing Trust REIT
8.625%, 1/15/12 303,800
300,000 Stingray Pass Through Trust (1)
5.902%, 1/12/15 222,383
200,000 UBS AG Stamford Connecticut
5.875%, 7/15/16 208,614
220,000 Unicredito Luxemburg Finance (1) (2)
5.584%, 1/13/17 215,956
Ventas Realty REIT LP
80,000 7.125%, 6/01/15 82,000
60,000 6.500%, 6/01/16 59,550
270,000 Xerox
5.500%, 5/15/12 270,348
Yum! Brands
170,000 6.875%, 11/15/37 170,407
170,000 6.250%, 3/15/18 170,713
--------------
TOTAL CORPORATE OBLIGATIONS
(Cost $11,374,808) 11,305,656
--------------
COLLATERALIZED MORTGAGE
OBLIGATIONS - 12.8%
1,550,000 Bear Stearns Commercial Mortgage
Securities, Series 2004-PWR3,
Class A4
4.715%, 2/11/41 1,491,714
870,000 Bear Stearns Commercial Mortgage
Securities, Series 2005-T18,
Class A4 (2)
4.933%, 2/13/42 836,030
274,794 Citigroup Mortgage Loan Trust,
Series 2003-1, Class WA2
6.500%, 6/25/31 278,681
465,549 Citigroup Mortgage Loan Trust,
Series 2003-UP3, Class A2
7.000%, 9/25/33 478,815
422,469 Citigroup Mortgage Loan Trust,
Series 2005-1, Class 3A1
6.500%, 4/25/35 430,035
2,025,307 Countrywide Alternative Loan Trust,
Series 2005-65CB, Class 1A7
5.500%, 1/25/36 2,024,691
1,930,563 Countrywide Alternative Loan Trust,
Series 2007-25, Class 1A2
6.500%, 11/25/37 1,917,894
1,255,000 Morgan Stanley Capital I,
Series 2003-T11, Class A3
4.850%, 6/13/41 1,246,270
520,000 Morgan Stanley Capital I,
Series 2004-T15, Class A4 (2)
5.270%, 6/13/41 515,022
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 62
- --------------------------------------------------------------------------------
SCHRODER TOTAL RETURN FIXED INCOME FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
22,798 Salomon Brothers Mortgage Securities
VII, Series 2001-CPB1, Class A (2)
7.552%, 12/25/30 22,714
--------------
TOTAL COLLATERALIZED
MORTGAGE OBLIGATIONS
(Cost $9,210,714) 9,241,866
--------------
MORTGAGE-BACKED
OBLIGATIONS - 7.5%
27,135 Fremont NIM Trust,
Series 2005-B (1) (3) (6)
5.500%, 4/25/35 9,497
26,177 Home Equity Asset Trust,
Series 2003-1, Class B2 (2) (3)
9.755%, 6/25/33 1,506
1,410,000 Merrill Lynch Mortgage Trust,
Series 2002-MW1, Class A4
5.619%, 7/12/34 1,428,543
1,330,000 Merrill Lynch Mortgage Trust,
Series 2004-BPC1, Class A3 (2)
4.467%, 10/12/41 1,295,595
800,000 Merrill Lynch Mortgage Trust,
Series 2006-C1, Class A3 (2)
5.659%, 5/12/39 808,777
18,934 Option One Mortgage Loan Trust,
Series 2002-3, Class M2 (2)
6.568%, 8/25/32 15,533
87,809 Residential Accredit Loans,
Series 1999-QS4, Class A1
6.250%, 3/25/14 87,453
53,727 Structured Asset Investment Loan
Trust, Series 2003-BC11,
Class M4 (2) (3)
7.873%, 10/25/33 23,847
29,626 Structured Asset Investment Loan
Trust, Series 2004-1, Class M4 (2) (3)
7.623%, 2/25/34 9,143
1,780,000 Wachovia Bank Commercial Mortgage
Trust, Series 2005-C19, Class A5
4.661%, 5/15/44 1,724,234
--------------
TOTAL MORTGAGE-BACKED
OBLIGATIONS
(Cost $5,424,300) 5,404,128
--------------
ASSET-BACKED SECURITIES - 0.2%
37,324 Hedged Mutual Fund Fee Trust,
Series 2003-1A, Class 2 (1) (2) (3) (6)
5.220%, 11/30/10 37,138
106,312 Hedged Mutual Fund Fee Trust,
Series 2003-2, Class 2 (1) (2) (3) (6)
4.840%, 3/02/11 105,780
--------------
TOTAL ASSET-BACKED
SECURITIES
(Cost $143,464) 142,918
--------------
Principal
Amount $ Value $
- -------------- --------------
SHORT-TERM INVESTMENT - 2.4%
1,726,245 JPMorgan Chase Bank, N.A.
Time Deposit (Nassau), 4.44% 1,726,245
--------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $1,726,245) 1,726,245
--------------
TOTAL INVESTMENTS - 106.2%
(Cost $76,471,394) 76,593,195
--------------
OTHER ASSETS LESS
LIABILITIES - (6.2)% (4,482,696)
--------------
NET ASSETS - 100.0% $ 72,110,499
==============
(1) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally to qualified institutions. On October 31, 2007, the
value of these securities amounted to $2,426,578, representing 3.4% of the
net assets of the Fund.
(2) Variable Rate Security -- Rate disclosed is as of October 31, 2007.
(3) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $187,694 representing 0.3% of the net assets of the
Fund.
(4) Security, or portion of the security, has been pledged as collateral on
mortgage dollar rolls.
(5) The rate shown represents the security's effective yield at time of
purchase.
(6) Security considered restricted. (See Note 2 in notes to Financial
Statements.)
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
GNMA -- Government National Mortgage Association
IO -- Interest Only Security
LLC -- Limited Liability Company
LP -- Limited Partnership
MTN -- Medium Term Note
NIM -- Net Interest Margin
REIT -- Real Estate Investment Trust
- --------------------------------------------------------------------------------
FUTURES CONTRACTS:
The Fund had the following futures contracts outstanding as of October 31, 2007:
NUMBER NET UNREALIZED
OF EXPIRATION APPRECIATION
CONTRACTS VALUE DATE (DEPRECIATION)
- --------------------------------------------------------------------------------
LONG:
U.S. Treasury
5 Year Note 114 $12,237,188 Dec-07 $ 50,729
SHORT:
U.S. Long Bond 3 335,246 Dec-07 (2,535)
--------
$ 48,194
========
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 63
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
MUNICIPAL BONDS - 97.4%
ALABAMA - 0.9%
Alabama Private Colleges &
Universities Facilities RB,
Tuskegee University Project,
Assured Guaranty
2,000,000 4.750%, 9/01/26 2,028,760
470,000 4.000%, 9/01/13 476,011
425,000 3.950%, 9/01/12 429,760
250,000 Crenshaw County, Industrial
Development Board RB, Sister
Schuberts Project, AMT,
Pre-Refunded @ 100,
(LOC: AmSouth Bank
of Alabama) (1) (2) (3) (4)
5.600%, 3/01/08 250,763
775,000 Jefferson County, Limited
Obligation School RB Warrants,
Series A
5.250%, 1/01/15 834,458
630,000 Jefferson County, Multi-Family
Housing Authority RB Warrants,
Mitchell Investments, Series A,
(LOC: Regions Bank)
5.400%, 9/01/12 643,293
1,300,000 Montgomery, Educational Building
Authority RB, Faulkner
University Project, RADIAN
5.250%, 10/01/32 1,310,062
--------------
5,973,107
ARIZONA - 5.3%
12,000,000 Arizona Health Facilities, Banner
Health RB, Series B (6)
4.315%, 1/01/37 11,154,480
275,000 Phoenix, Industrial Development
Authority RB, Hacienda
Sunnyslope Project, Series A,
AMT, GNMA
4.350%, 7/20/15 277,137
20,000,000 Phoenix, Industrial Development
Authority RB, Series 2007-3,
AMT, GNMA, FNMA, FHLMC
5.625%, 5/01/39 20,955,400
180,000 Pinal County, Industrial
Development Authority RB,
Florence West Prison, Series B, ACA (8)
5.250%, 10/01/08 180,679
1,175,000 Scottsdale, Industrial Authority,
Memorial Hospitals, AMBAC, ETM
5.500%, 9/01/12 1,236,370
1,170,000 State Health Facilities Authority
RB, Phoenix Baptist Hospital
& Medical Center, MBIA, ETM
6.250%, 9/01/11 1,209,452
Principal
Amount $ Value $
- -------------- --------------
760,000 Tucson & Pima County,
Industrial Development
Authority RB, Series B, AMT,
GNMA, FNMA, FHLMC
4.600%, 12/01/30 773,596
--------------
35,787,114
ARKANSAS - 3.8%
570,000 Baxter County, Hospital Revenue
Authority RB, Refunding &
Improvement Project, Series A
5.375%, 9/01/14 578,915
4,240,000 Cabot, Sales & Use Tax RB, XLCA
4.300%, 12/01/31 4,291,855
340,000 Centerton, Sales & Use Tax RB
4.500%, 3/01/35 327,046
1,000,000 Drew County, Industrial
Development RB, JP Price
Lumber Project, Series B,
ADFA, AMT
5.000%, 2/01/16 1,029,140
2,730,000 Fayetteville, Sales & Use Tax RB,
Capital Improvement,
Series A, FSA
3.000%, 11/01/20 2,381,789
Heber Springs, Sales & Use
Tax RB, CIFG
1,240,000 4.700%, 6/01/30 1,249,536
1,205,000 4.650%, 6/01/27 1,214,628
1,000,000 Howard County, Sales & Use
Tax RB, RADIAN
4.250%, 6/01/47 852,340
1,300,000 Little Rock, Library Construction
GO, Series A
4.250%, 3/01/23 1,286,350
10,015,000 Magnolia, Sales & Use Tax RB, CIFG
4.500%, 8/01/37 9,633,128
250,000 Pine Bluff, Industrial Development RB,
Weyerhaeuser Project
5.500%, 11/01/07 250,000
370,000 Scott County, Sales & Use Tax RB,
Correctional Facility Improvements
5.000%, 8/01/36 370,599
745,000 Springdale, Sales & Use Tax RB, MBIA
4.000%, 7/01/16 755,519
1,680,000 Stuttgart, Sales & Use Tax RB,
AMBAC
4.200%, 10/01/31 1,672,406
--------------
25,893,251
CALIFORNIA - 6.9%
700,000 Benicia, Unified School District
GO, Series B, MBIA (5)
4.589%, 8/01/18 412,692
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 64
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
California Health Facilities Funding
Authority RB, California-Nevada-
Methodist Project
360,000 5.000%, 7/01/14 379,141
375,000 5.000%, 7/01/15 395,475
395,000 5.000%, 7/01/16 416,559
825,000 4.250%, 7/01/11 828,523
85,000 California Statewide Communities
Development Authority COP,
Kaiser Remarket, FSA, ETM
5.300%, 12/01/15 88,147
8,390,000 Contra Costa Home Mortgage
Finance RB, Multi-Family Housing,
MBIA, ETM (5)
6.481%, 9/01/17 4,407,854
90,000 Delta County Home Mortgage
Finance RB, Single-Family
Mortgage-Backed Securities,
Series A, AMT, MBIA, GNMA, FNMA
5.350%, 6/01/24 91,121
575,000 Folsom, Public Financing Authority,
Special Tax Revenue, Sub-Series B
3.850%, 9/01/08 574,390
8,000,000 Gardena COP, Series B, RADIAN (8)
6.800%, 7/01/36 8,082,960
804,092 Knightsen School District RB,
Flexfund Program
4.500%, 8/01/17 814,014
Long Beach, Financial Authority
RB, Natural Gas Purification,
Series B (6)
3,940,000 5.270%, 11/15/27 3,841,500
5,750,000 5.250%, 11/15/26 5,606,250
3,000,000 5.230%, 11/15/25 2,925,000
3,045,000 Los Angeles, Community
Redevelopment Agency RB,
Pooled Financing, Series M,
RADIAN (8)
6.100%, 9/01/16 3,124,079
490,000 Los Angeles, Multi-Family Housing
RB, Colorado Terrace Project,
Series H, AMT, GNMA
4.350%, 11/20/12 496,287
3,490,000 Manteca, Financing Authority
Sewer RB, Series B, MBIA
5.000%, 12/01/33 3,501,657
487,998 Mountain Valley Unified School
District RB, Flexfund Program
4.250%, 5/01/22 486,358
2,544,967 Oak Grove, Unified School District
RB, Flexfund Program
4.750%, 8/01/27 2,541,888
1,591,003 Palo Verde Unified School District
COP, Flexfund Program
4.800%, 9/01/27 1,612,275
Principal
Amount $ Value $
- -------------- --------------
1,525,064 Paso Robles Unified School
District RB, Flexfund Program
4.300%, 5/01/22 1,525,049
25,000 Placer County, Water Agency
RB, Middle Fork Project
3.750%, 7/01/12 24,819
45,000 Sacramento County, Sacramento
Main Detention Center COP,
MBIA, ETM
5.500%, 6/01/10 46,302
10,000 Sacramento County, Sanitation
Authority RB, ETM
5.125%, 12/01/10 10,012
153,000 San Bernardino County,
Transportation Authority RB,
Series A, FGIC, ETM
6.000%, 3/01/10 157,244
175,000 Southern California, Public Power
Authority RB, Palo Verde Project,
Series A, ETM
5.000%, 7/01/17 175,210
3,430,000 Stockton, United Christian Schools
COP, Mandatory Put,
(LOC: Pacific Capital Bank) (1) (7)
4.300%, 10/01/33 3,430,000
545,000 Valley Center, Unified School
District GO, Capital Appreciation,
Series A, MBIA (5)
4.521%, 9/01/17 321,817
--------------
46,316,623
COLORADO - 5.5%
3,870,000 Adonea, Metropolitan District
No. 2 RB, Series B,
(LOC: Compass Bank)
4.375%, 12/01/15 3,906,649
Aspen Grove Business Improvement
District GO, RADIAN
410,000 5.500%, 12/01/12 433,579
450,000 5.500%, 12/01/14 480,955
505,000 5.000%, 12/01/16 522,877
1,115,000 4.750%, 12/01/21 1,098,085
1,390,000 4.625%, 12/01/25 1,323,600
335,000 Aspen Grove Business Improvement
District GO, Supplemental B
Interest Coupons, RADIAN
3.880%, 12/01/07 333,992
590,000 Beacon Point, Metropolitan
District RB, Series B,
(LOC: Compass Bank)
4.375%, 12/01/15 595,157
1,000,000 Colorado Educational & Cultural
Facilities Authority RB, Avenue
Maria School Project, RADIAN
4.850%, 12/01/25 981,070
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 65
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
3,020,000 Colorado Educational & Cultural
Facilities Authority RB, Charter
School-Bromley East Project,
Series A, Pre-Refunded @ 100 (2)
7.250%, 9/15/11 3,416,103
2,000,000 Colorado Health Facilities Authority
RB, Portercare Adventist Health,
Pre-Refunded @ 101 (2)
6.500%, 11/15/11 2,237,500
100,000 Denver City & County COP,
Series A, MBIA, Pre-Refunded @ 100 (2)
5.000%, 5/01/08 100,767
5,000,000 Denver Health & Hospital
Authority RB, Series B (6)
4.839%, 12/01/33 4,525,000
25,000 Denver, City & County Airport RB,
Series D, AMT
7.750%, 11/15/13 27,505
1,450,000 High Plains, Metropolitan
District RB, (LOC: Compass Bank)
4.375%, 12/01/15 1,473,664
500,000 Interlocken Metropolitan District GO,
Series A, RADIAN
5.750%, 12/15/11 522,620
1,450,000 Maher Ranch, Metropolitan District
No. 4, GO, RADIAN
4.625%, 12/01/17 1,445,896
Southlands, Metropolitan
District No. 1 GO,
Pre-Refunded @ 100 (2)
4,400,000 7.125%, 12/01/14 5,322,152
1,175,000 7.000%, 12/01/14 1,413,008
600,000 State Educational & Cultural Facilities
Authority RB, Charter School,
Littleton, CIFG
4.300%, 1/15/26 570,396
415,000 State Educational & Cultural Facilities
Authority RB, Charter School,
Peak to Peak, XLCA
3.000%, 8/15/09 409,327
365,000 State Educational & Cultural Facilities
Authority RB, Parker Core Charter
School, XLCA
3.500%, 11/01/14 356,853
2,000,000 State Health Facilities Authority RB,
Catholic Health, Series A, ETM
5.500%, 3/01/22 2,138,580
1,590,000 State Health Facilities Authority RB,
Poudre Valley Health Care, Series F
5.000%, 3/01/25 1,560,967
30,000 State Health Facility Authority RB,
Series A, ETM
5.350%, 11/01/16 30,491
Principal
Amount $ Value $
- -------------- --------------
Teller County, COP, Assured Guaranty
400,000 5.000%, 12/01/24 422,264
120,000 4.550%, 12/01/18 122,189
310,000 4.500%, 12/01/17 316,302
300,000 4.400%, 12/01/16 305,505
150,000 4.150%, 12/01/13 151,038
190,000 3.500%, 12/01/09 190,034
180,000 3.150%, 12/01/07 179,939
--------------
36,914,064
CONNECTICUT - 0.5%
50,000 Greenwich, New Public Housing
Authority RB
5.250%, 5/01/08 50,462
35,000 State Health & Educational
Facilities RB, Danbury
Hospital, ETM
7.875%, 7/01/09 36,489
2,000,000 State Health & Educational Facilities
RB, Saint Francis Hospital Medical
Center, Series D, RADIAN
5.500%, 7/01/17 2,103,780
1,100,000 State Resource Recovery Authority
RB, Middle Connecticut System,
Series A, MBIA,
Pre-Refunded @ 100 (2)
5.500%, 11/15/08 1,112,793
--------------
3,303,524
DELAWARE - 0.8%
New Castle County, Newark
Charter School Income Project RB
365,000 5.000%, 9/01/17 365,234
1,000,000 5.000%, 9/01/22 969,380
255,000 4.750%, 9/01/13 255,112
150,000 4.750%, 9/01/15 148,830
825,000 State Economic Development
Authority RB, Delmarva
Power & Light, Series D, AMT
5.650%, 7/01/28 853,562
State Housing Authority RB,
Single-Family Mortgage,
Series D-2 (8) (12)
90,000 5.000%, 1/01/09 89,843
510,000 5.000%, 7/01/09 509,102
560,000 5.000%, 7/01/10 558,236
1,915,000 Wilmington, Multi-Family Housing
RB, Market Street Mews,
GNMA, AMT
5.450%, 9/20/22 1,960,232
--------------
5,709,531
DISTRICT OF COLUMBIA - 0.2%
500,000 District of Columbia GO,
Series B, FSA, ETM
5.500%, 6/01/14 519,595
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 66
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
585,000 District of Columbia RB, Enterprise
Zone-819 7th Street, AMT,
Mandatory Put, (LOC: Branch
Banking & Trust) (7)
3.600%, 10/01/24 580,495
Hospital RB, Medlantic Healthcare
Group, Series A, MBIA, ETM
100,000 5.750%, 8/15/14 101,169
410,000 5.750%, 8/15/26 414,707
--------------
1,615,966
FLORIDA - 5.8%
6,235,000 Capital Projects Finance Authority
RB, Genridge on Palmer Ranch,
Series A, Pre-Refunded @102 (2)
8.000%, 6/01/12 7,449,204
1,300,000 Collier County, Industrial
Development Authority RB,
Naples Community Hospital
Project, Mandatory Put,
(LOC: Bank of America NA) (7)
4.650%, 10/01/34 1,308,840
394,783 Dade County, Single-Family
Housing Finance Authority RB,
Series B-1, AMT, GNMA, FNMA
6.100%, 4/01/27 409,765
475,000 Florida State, Jacksonville
Transportation Authority GO, ETM
9.200%, 1/01/15 594,372
Gulf Breeze, Local Government
RB, FGIC, Mandatory Put (6) (7)
1,135,000 4.000%, 12/01/20 1,126,669
600,000 4.000%, 12/01/20 591,426
2,275,000 Highlands County, Health Facilities
Authority RB, Adventist Health
System, Series D,
Pre-Refunded @ 100 (2)
5.375%, 11/15/13 2,478,226
500,000 Hillsborough County School Board
COP, Series B, MBIA
5.000%, 7/01/18 524,355
140,000 Jacksonville, Electric Authority RB, ETM
5.375%, 7/01/12 146,163
10,000 Jacksonville, Electric Authority RB,
Third Installment, ETM
6.800%, 7/01/12 10,812
125,000 Jacksonville, Health Facilities RB,
Daughters of Charity, MBIA,
ETM (1) (3) (4)
5.000%, 11/15/15 125,139
1,255,000 Manatee County, Housing Finance
Authority RB, Series A, GNMA,
FNMA, FHLMC, AMT (12)
4.550%, 9/01/17 1,252,703
Principal
Amount $ Value $
- -------------- --------------
485,000 Miami Special RB, MBIA (5)
12.680%, 1/01/15 321,536
6,150,000 Miami-Dade County, Expressway
Authority RB, FGIC,
Pre-Refunded @ 101 (2)
6.375%, 7/01/10 6,653,746
Miami-Dade County, Public Service RB,
Unincorporated Municipal Service
Area, Public Improvements,
Series A, XLCA
280,000 4.750%, 4/01/27 282,957
1,115,000 4.700%, 4/01/26 1,124,422
1,110,000 4.625%, 4/01/24 1,114,584
675,000 4.600%, 4/01/23 678,564
8,045,000 Orange County, Health Facilities
Authority RB, Adventist Health
System, Pre-Refunded @ 101 (2)
5.625%, 11/15/12 8,848,937
60,000 Orange County, Tourist
Division RB, AMBAC, ETM
6.000%, 10/01/16 60,292
1,060,000 Orange County, Tourist
Division RB, Series A, AMBAC, ETM
6.250%, 10/01/13 1,123,250
1,300,000 Osceola County, School Board
COP, Series A, AMBAC,
Pre-Refunded @ 101 (2)
5.250%, 6/01/12 1,403,168
315,000 Pinellas County, Housing Finance
Authority RB, Multi-County Program,
Series A-3, AMT, GNMA, FNMA
4.000%, 3/01/25 314,518
120,000 Tampa, Allegany Health System
RB, Saint Anthony, MBIA, ETM
5.125%, 12/01/15 120,785
65,000 Tampa, Allegany Health System
RB, Saint Joseph, MBIA, ETM
5.125%, 12/01/23 65,425
340,000 Tampa, Allegany Health System
RB, Saint Mary's, MBIA, ETM
5.125%, 12/01/23 342,309
100,000 Vero Beach, Electric RB, MBIA, ETM
6.500%, 12/01/07 100,229
850,000 Volusia County, Educational
Facilities Authority RB, Embry Riddle,
RADIAN (6)
5.000%, 10/15/25 854,411
--------------
39,426,807
GEORGIA - 0.5%
2,060,000 Cobb County, Kennestone
Hospital Authority RB,
Capital Appreciation Certificates,
Series 86A, MBIA, ETM (5)
6.159%, 8/01/15 1,288,077
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 67
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
Crisp County Cordele Industrial
Development Authority RB,
Cavalier Industries Project, AMT,
(LOC: First Commercial Bank)
75,000 5.250%, 4/01/09 75,026
100,000 5.150%, 4/01/08 100,030
45,000 Fulco, Hospital Authority RB,
Saint Joseph Hospital, ETM
5.375%, 10/01/09 45,068
40,000 Gwinnett County, Water & Sewer RB,
MBIA, ETM
6.100%, 3/01/08 40,345
1,770,000 Kennesaw, Urban Redevelopment
Agency RB, City Hall Expansion Project
3.950%, 1/01/19 1,773,682
490,000 Municipal Electric Authority
Power RB, Capital Appreciation,
Series Q, MBIA (5)
6.785%, 1/01/12 375,928
--------------
3,698,156
IDAHO - 0.0%
5,000 Idaho Falls, Electric Revenue
Authority RB, ETM
6.750%, 4/01/09 5,133
145,000 State Housing & Finance Association
RB, Single-Family Mortgage,
Series D, Class III, AMT
5.400%, 7/01/21 147,583
--------------
152,716
ILLINOIS - 6.8%
3,000,000 Bartlett, Quarry Redevelopment
TA, Elopment Project (8)
5.600%, 1/01/23 3,020,550
4,460,000 Bolingbrook, Sales Tax RB (5)
1.277%, 1/01/15 4,555,667
1,180,000 Bolingbrook, Special Services Areas
Special Tax, Reference 2001-1-2-3
& 2002-1, MBIA
4.000%, 3/01/18 1,162,076
560,000 Calhoun & Greene Counties,
Community School District No. 40, GO
4.700%, 1/01/16 567,000
1,000,000 Cary, Special Tax, Special Service
Area No. 2, RADIAN
4.400%, 3/01/16 1,000,390
1,750,000 Chicago, Increment Allocation
Revenue, Diversey Narragansett
Project COP
7.460%, 2/15/26 1,822,503
2,000,000 Chicago, Kingsbury Redevelopment
Project TAN, Series A
6.570%, 2/15/13 2,035,660
Principal
Amount $ Value $
- -------------- --------------
1,000,000 Chicago, Lake Shore East SA
6.750%, 12/01/32 1,049,750
Cook County, School District
No. 159 GO, FSA (5)
315,000 4.644%, 12/01/12 259,881
525,000 4.453%, 12/01/11 450,923
350,000 4.062%, 12/01/09 324,527
3,500,000 Cortland, Special Tax, Sheaffer
Systems Project (1)
5.500%, 3/01/17 3,451,070
825,000 Granite City, Industrial
Development Authority RB,
Carron Industry Project, AMT,
(LOC: First Bank)
4.875%, 4/01/17 799,648
1,205,000 Huntley, Special Tax, Special
Service Area No. 10, Assured Guaranty
5.100%, 3/01/29 1,255,803
1,000,000 Huntley, Special Tax, Special
Service Area No. 7, Assured Guaranty
5.100%, 3/01/28 1,042,930
1,235,000 Huntley, Special Tax, Special
Service Area No. 8, Assured Guaranty
4.600%, 3/01/17 1,262,466
1,880,000 Huntley, Special Tax, Special
Service Area No. 9, Assured Guaranty
5.100%, 3/01/28 1,960,708
1,253,000 Lakemoor Village, Special Tax, RADIAN
4.550%, 3/01/16 1,252,925
2,519,000 Pingree Grove, Special Services Area,
Cambridge Lakes Project, Series 05-1
5.250%, 3/01/15 2,534,038
615,000 Round Lake, Special Tax, Lakewood
Grove, Assured Guaranty
4.150%, 3/01/17 619,096
850,000 State Educational Facilities Authority
RB, Capital Appreciation, ETM (5)
9.996%, 7/01/14 563,958
740,000 State Educational Facilities Authority
RB, Capital Appreciation,
Pre-Refunded @ 57.17 (2) (5)
60.780%, 7/01/09 381,677
1,120,000 State Financial Authority RB, Medical
District Common Project,
Series A, CIFG
4.125%, 9/01/18 1,087,990
850,000 State Financial Authority RB,
Metropolitis Project
5.000%, 12/01/24 855,721
3,750,000 State Financial Authority RB,
Multi-Family Housing Authority,
Liberty Project, Series A,
(LOC: Harris NA) (8)
5.530%, 10/01/22 3,755,737
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 68
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
260,000 State Financial Authority RB,
Multi-Family Housing Authority,
Liberty Project, Series B,
(LOC: Harris NA) (8)
5.570%, 10/01/11 261,537
2,925,000 State Health Facilities Authority
RB, Hinsdale Hospital, Series A, ETM
6.950%, 11/15/13 3,273,777
275,000 State Health Facilities Authority RB,
Hospital of Sisters Services,
Series A, FSA, Optional Put
4.500%, 12/01/23 275,074
555,000 Will County, Community School
District GO, Alternative Revenue
Source Larway
5.625%, 12/01/23 589,832
Yorkville United City Sales Tax RB,
Kendall Marketplace Project
3,755,000 6.000%, 1/01/26 3,637,694
420,000 6.000%, 1/01/27 406,501
--------------
45,517,109
INDIANA - 2.4%
Avon Community School Building
RB, First Mortgage, AMBAC
1,305,000 4.750%, 7/15/23 1,340,679
5,815,000 4.625%, 7/15/22 5,912,518
Brownsburg 1999 School Building
RB, First Mortgage, Series B, FSA
1,050,000 4.750%, 7/15/24 1,075,379
1,100,000 4.750%, 7/15/25 1,122,231
60,000 4.250%, 7/15/09 60,806
Gary, Sanitation District, Special
Taxing District, RADIAN
250,000 5.000%, 2/01/12 257,498
270,000 5.000%, 2/01/13 278,753
25,000 Indianapolis, Industrial Utilities
District RB, ETM
7.000%, 6/01/08 25,350
1,685,000 Indianapolis, Local Public
Improvements RB, Glendale
Mall Project, Series G (8)
5.640%, 8/01/17 1,668,672
Maconaquah, School District
RB, Energy Management
Financing Project
286,756 5.000%, 1/01/12 296,749
301,093 5.000%, 1/01/13 313,019
316,148 5.000%, 1/01/14 330,115
261,339 4.750%, 1/01/10 265,513
273,752 4.750%, 1/01/11 279,550
241,622 4.000%, 1/01/08 241,605
251,287 4.000%, 1/01/09 251,486
Principal
Amount $ Value $
- -------------- --------------
Munster, Municipal Center
RB, First Mortgage
400,000 5.000%, 7/15/24 408,308
700,000 4.875%, 7/15/21 712,320
445,000 4.700%, 7/15/17 452,636
95,000 State Health Facility Financing
Authority RB, Ancilla Systems,
MBIA, ETM
5.250%, 7/01/22 96,062
State Health Facility Financing
Authority RB, Methodist
Hospital, Series A, AMBAC, ETM
80,000 5.750%, 9/01/11 80,831
360,000 5.750%, 9/01/15 363,816
20,000 Wells County, Hospital
Authority RB, ETM
7.250%, 4/01/09 20,386
--------------
15,854,282
IOWA - 0.7%
Coralville COP, Series D
500,000 5.250%, 6/01/15 528,785
300,000 5.000%, 6/01/12 310,191
200,000 5.000%, 6/01/13 207,510
275,000 5.000%, 6/01/14 286,244
75,000 State Financial Authority RB,
Mercy Health System, Series V,
FSA, ETM
5.250%, 8/15/27 75,826
1,345,000 Tobacco Settlement Authority RB,
Asset-Backed, Series B,
Pre-Refunded @ 101 (2)
5.300%, 6/01/11 1,422,768
Xenia Rural Water
Distribution RB, CIFG
1,100,000 4.500%, 12/01/31 1,066,901
1,000,000 4.500%, 12/01/41 945,070
--------------
4,843,295
KANSAS - 1.0%
175,000 Fredonia, Temporary Notes
GO, Series 1
4.375%, 8/01/10 175,432
5,075,000 Manhattan, Special Obligation
Revenue Notes, South Project
Area Downtown, Series A
4.875%, 12/01/08 5,078,553
190,000 Shawnee, Multi-Family Housing
RB, Thomasbrook Apartments,
Series A, AMT, FNMA
5.250%, 10/01/14 193,076
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 69
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
1,000,000 University of Kansas Hospital
Authority RB, KU Health Systems,
Series A, AMBAC,
Pre-Refunded @100 (2)
5.400%, 9/01/09 1,034,490
--------------
6,481,551
KENTUCKY - 0.4%
1,800,000 Marshall County, Public Property
Corporation RB, Courthouse
Facility Project
5.250%, 3/01/23 1,917,432
645,000 State Area Development Districts
Financing GO, Henderson,
Series G1, Pre-Refunded @102 (2)
5.750%, 12/01/07 658,416
--------------
2,575,848
LOUISIANA - 3.7%
220,000 Calcasieu Parish, Public Transportation
Authority RB, Single-Family
Mortgage, Series A, AMT,
GNMA, FNMA
5.850%, 10/01/32 221,866
5,000,000 Denham Springs-Livingston, Housing
& Mortgage Financial Authority RB,
Mortgage-Backed Securities Program,
GNMA, FNMA, FHLMC
5.000%, 11/01/40 5,153,700
4,500,000 Houma-Terrebonee, Public Financing
Authority RB, Mortgage-Backed Securities
Program, GNMA, FNMA, FHLMC
5.150%, 12/01/40 4,655,925
425,000 Local Government RB, Environmental
Facilities & Community Development
Authority, Series 2003-D,
Pre-Refunded @ 102 (2)
8.500%, 6/01/13 531,632
2,535,000 State Housing Financial Agency RB,
Multi-Family Housing Revenue,
Plantation Apartment Project,
Series A, FNMA, Mandatory Put (7)
4.100%, 4/15/37 2,502,298
1,890,000 State Housing Financial Agency RB,
Single Family Housing Revenue,
AMT Home Ownership Program,
Series B-2, GNMA, FNMA, FHLMC
4.600%, 12/01/14 1,933,640
1,185,000 State Housing Financial Agency RB,
Single-Family Home Ownership,
Series A2, AMT, GNMA, FNMA
5.800%, 6/01/36 1,250,116
2,270,000 State Multi-Family Housing Finance
Agency RB, Section 8-202 Project,
Series A
4.750%, 12/01/31 2,301,508
Principal
Amount $ Value $
- -------------- --------------
1,050,000 State Public Facilities Authority RB,
FHA Insured Mortgage, Baton Rouge
General Medical Center, MBIA
5.250%, 7/01/24 1,099,161
980,000 State Public Facilities Authority RB,
Pennington Medical Foundation Project
4.000%, 7/01/11 976,648
4,800,000 State Public Facilities Authority RB,
Tulane University Project, Series A-2,
MBIA (6)
4.424%, 2/15/36 4,536,000
--------------
25,162,494
MARYLAND - 0.3%
Annapolis, Economic Development
RB, Saint Johns College Facilities,
Series A
525,000 4.500%, 10/01/21 509,229
110,000 4.375%, 10/01/15 109,669
115,000 4.375%, 10/01/16 114,033
120,000 4.375%, 10/01/17 118,147
105,000 4.300%, 10/01/14 104,748
90,000 4.250%, 10/01/11 90,514
95,000 4.250%, 10/01/12 95,164
100,000 4.250%, 10/01/13 99,867
Annapolis, Economic Development
RB, Saint Johns College Facilities,
Series B
115,000 4.375%, 10/01/15 114,654
135,000 4.375%, 10/01/17 132,916
105,000 4.300%, 10/01/14 104,748
75,000 4.250%, 10/01/11 75,428
85,000 4.250%, 10/01/12 85,147
--------------
1,754,264
MASSACHUSETTS - 1.8%
260,000 State Development Finance
Agency RB, Curry College,
Series A, ACA
3.875%, 3/01/15 254,758
465,000 State Development Finance
Agency RB, Dexter School Project
4.500%, 5/01/27 450,901
545,000 State Development Finance
Agency RB, Seven Hills
Foundation & Affiliates, RADIAN
4.500%, 9/01/16 543,398
5,250,000 State GO, Consolidated Loan,
Series A, Pre-Refunded @ 100 (2)
5.125%, 1/01/13 5,626,688
515,000 State Health & Educational
Facilities Authority RB, Cape
Cod Healthcare, Series C, RADIAN
5.250%, 11/15/17 530,908
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 70
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
760,000 State Health & Educational
Facilities Authority RB, Mass
General Hospital, Series F, AMBAC
6.250%, 7/01/12 807,926
932,000 State Health & Educational
Facilities Authority RB, Nichols
College Issue, Series C
6.000%, 10/01/17 972,542
1,610,000 State Housing Financial Agency
GO, HUD, ETM (5)
4.617%, 2/01/23 564,691
555,000 State Housing Financial Agency
RB, Series D
4.200%, 12/01/10 564,785
1,500,000 State Water Reserves Authority RB,
Series C, FGIC
5.250%, 12/01/15 1,623,885
--------------
11,940,482
MICHIGAN - 1.4%
2,710,000 Kalamazoo, Hospital Finance
Authority RB, Borgess Medical
Center, Series A, AMBAC, ETM
5.625%, 6/01/14 2,880,839
10,000 State Hospital Finance Authority RB,
Charity Obligatory Group,
Series A, ETM
5.000%, 11/01/19 10,280
45,000 State Hospital Finance Authority RB,
Daughters of Charity Hospital, ETM
5.250%, 11/01/10 45,060
10,000 State Hospital Finance Authority RB,
Mercy Health Services, MBIA, ETM
5.750%, 8/15/26 10,115
45,000 State Hospital Finance Authority RB,
Mercy Health Services, Series Q,
AMBAC, ETM
5.375%, 8/15/26 45,276
70,000 State Hospital Finance Authority RB,
Saint John Hospital, AMBAC, ETM
5.250%, 5/15/26 70,491
State Hospital Finance Authority RB,
Saint John Hospital, Series A,
AMBAC, ETM
340,000 6.000%, 5/15/13 347,075
25,000 5.750%, 5/15/16 25,043
865,000 State Strategic Fund, Solid Waste
Disposal RB, Limited Obligatory
Waste Management, AMT
4.500%, 12/01/13 857,353
5,700,000 State University RB, Series B,
AMBAC (6)
4.354%, 2/15/37 5,396,589
--------------
9,688,121
Principal
Amount $ Value $
- -------------- --------------
MINNESOTA - 0.4%
960,000 Burnsville, Hospital System RB, Fairview
Community Hospitals, ETM (5)
5.780%, 5/01/12 733,623
15,000 Coon Rapids, Hospital RB,
Health Central, ETM
7.625%, 8/01/08 15,348
1,979,169 Minneapolis Saint Paul, Housing
Financial Board RB, Single-Family
Mortgage, Mortgage-Backed City
Living, Series A-5, GNMA, FNMA,
FHLMC
5.450%, 4/01/27 2,097,642
27,000 Minneapolis, Community Development
Agency RB, BIG, ETM
8.875%, 11/01/11 29,714
--------------
2,876,327
MISSISSIPPI - 0.3%
310,000 Horn Lake SA, Desoto Commons,
AMBAC
5.000%, 4/15/17 328,228
Meridian, Housing Authority RB,
Series A, AMT (1)
1,200,000 5.000%, 9/01/15 1,222,440
655,000 5.000%, 9/01/25 654,954
--------------
2,205,622
MISSOURI - 4.6%
1,000,000 Andrew County, Region III School
District Lease COP, Refinance
& Improvement, FSA
4.375%, 3/01/20 1,005,660
710,000 Boone County, Industrial
Development Authority RB,
Otscon Project, AMT, Mandatory
Put, (LOC: Boone County
National Bank) (6) (7)
4.750%, 5/01/18 695,899
890,000 Brentwood, Tax Increment TA,
Brentwood Pointe Project
4.500%, 5/01/23 895,224
760,000 Brentwood, Tax Increment TA,
Brentwood Square Project
4.500%, 5/01/22 761,968
1,430,000 Hannibal, Industrial Development
Authority Tax, Stardust-
Munger Project
4.700%, 4/15/23 1,432,846
Ozark Centre, Transportation
Development District RB
175,000 5.375%, 9/01/32 168,602
200,000 4.875%, 9/01/24 196,382
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 71
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
Raytown Annual, Appropriation-
Supported Tax RB, Live
Redevelopment Plan Project 1
1,750,000 5.125%, 12/01/25 1,779,750
250,000 5.000%, 12/01/13 259,163
1,055,000 5.000%, 12/01/14 1,097,031
765,000 5.000%, 12/01/16 795,547
1,675,000 5.000%, 12/01/21 1,705,703
1,000,000 5.000%, 12/01/22 1,015,950
5,050,000 4.750%, 12/01/27 4,847,647
Ritenour School District,
Educational Facilities Authority RB
400,000 5.000%, 3/01/22 400,156
135,000 4.750%, 3/01/16 135,055
140,000 4.750%, 3/01/17 140,029
130,000 4.625%, 3/01/15 130,036
45,000 4.500%, 3/01/08 45,062
110,000 4.500%, 3/01/12 110,069
115,000 4.500%, 3/01/13 115,050
80,000 4.375%, 3/01/10 80,051
110,000 4.375%, 3/01/11 110,045
50,000 4.250%, 3/01/09 50,023
State Development Finance Board
Infrastructure Facilities RB,
Branson Landing Project, Series A
180,000 4.250%, 6/01/13 176,143
100,000 4.125%, 6/01/12 97,751
125,000 State Development Finance Board
Infrastructure Facilities RB,
Branson, Series A
5.375%, 12/01/22 126,851
430,000 State Development Finance Board
Infrastructure Facilities RB,
Drumm Farm Project
4.625%, 3/01/20 429,776
500,000 State Development Finance Board
Infrastructure Facilities TA,
Triumph Foods Project, Series A
5.250%, 3/01/25 511,225
310,000 State Development Financial Board,
Infrastructure Facilities TA,
Drumm Farm Project, Series D
4.250%, 4/01/17 302,235
State Development Financial Board,
Infrastructure Facilities TA,
Eastland Center Project, Series A
455,000 5.000%, 4/01/11 468,796
825,000 5.000%, 4/01/12 853,339
395,000 5.000%, 4/01/17 409,702
550,000 5.000%, 4/01/20 564,944
Principal
Amount $ Value $
- -------------- --------------
State Development Financial
Board, Infrastructure Facilities
TA, Hartman Heritage Project,
Series B
510,000 5.000%, 4/01/18 527,794
360,000 5.000%, 4/01/20 369,781
State Development Financial
Board, Infrastructure
Facilities TA, Santa Fe Project,
Series C (8)
2,000,000 6.096%, 4/01/23 2,004,700
560,000 5.746%, 4/01/16 561,859
530,000 5.696%, 4/01/15 531,749
500,000 5.646%, 4/01/14 503,690
475,000 5.515%, 4/01/13 477,404
325,000 State Health & Educational
Facilities Authority RB, Maryville
University of Saint Louis Project,
Pre-Refunded @ 100 (2)
6.750%, 6/15/10 350,636
1,640,000 State Health & Educational
Facilities Authority RB, Park
Lane Medical Center, Series A,
MBIA, ETM
5.600%, 1/01/15 1,732,020
180,000 State Housing Development
Community RB, Single-Family
Homeowner Loan Program,
Series A-1, GNMA
5.000%, 3/01/17 181,933
1,725,000 State Transportation Sales Tax RB,
Transportation Development
District, Interstates 470 & 350,
Refinancing & Improvement, RADIAN
4.600%, 6/01/29 1,732,952
--------------
30,888,228
MONTANA - 1.1%
6,995,000 Forsyth, Pollution Control RB,
Northwestern Colstrip, AMBAC
4.650%, 8/01/23 7,015,495
165,000 State Board Investment RB,
Payroll Tax Workers Compensation
Project, MBIA, ETM
6.875%, 6/01/11 171,092
--------------
7,186,587
NEBRASKA - 0.2%
140,000 Nebhelp RB, Jr-Sub-Series A-6,
AMT, MBIA
6.400%, 6/01/13 147,753
10,000 Scotts Bluff County, Hospital
Authority No. 1 RB, Regional
West Medical Center
6.375%, 12/15/08 10,016
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 72
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
State Educational Finance
Authority RB, Dana College,
Series A
200,000 4.500%, 3/15/13 186,818
195,000 4.500%, 3/15/14 179,687
180,000 4.350%, 3/15/12 169,506
State Educational Finance
Authority RB, Dana College,
Series D
170,000 5.400%, 3/15/25 153,969
240,000 5.200%, 3/15/20 219,458
50,000 4.950%, 3/15/16 46,270
50,000 4.850%, 3/15/15 46,470
45,000 4.700%, 3/15/13 42,443
50,000 4.700%, 3/15/14 46,596
45,000 4.550%, 3/15/12 42,719
40,000 4.450%, 3/15/11 38,330
--------------
1,330,035
NEVADA - 0.2%
1,404,045 Rural Housing Authority RB,
Single-Family Housing,
Series A, GNMA, FNMA (6)
5.250%, 8/01/38 1,452,850
--------------
NEW HAMPSHIRE - 0.0%
185,000 State Health & Educational
Facilities Authority RB, Speare
Memorial Hospital
5.000%, 7/01/12 187,135
--------------
NEW JERSEY - 5.0%
150,000 Burlington County, Bridge
Commissioner RB, Government
Leasing Program,
County Guaranteed,
Pre-Refunded @ 100 (2)
5.250%, 8/15/12 161,131
3,000,000 Camden County, Improvement
Authority GO (8)
5.450%, 3/20/08 3,001,440
1,550,000 Haddon Township BAN (8)
5.625%, 2/15/08 1,551,658
Health Care Facilities RB,
Allegany Health, Our Lady
of Lourdes, MBIA, ETM
30,000 5.200%, 7/01/18 31,373
50,000 5.125%, 7/01/13 51,331
80,000 Health Care Facilities RB,
Community Memorial Hospital
Toms River, ETM
6.750%, 7/01/09 82,785
20,000 Health Care Facilities RB,
Mercer Medical Center, ETM
7.000%, 7/01/08 20,372
Principal
Amount $ Value $
- -------------- --------------
Lake Como Boro GO
20,000 4.400%, 7/15/08 20,086
38,000 4.400%, 7/15/09 38,384
40,000 4.400%, 7/15/10 40,589
40,000 4.400%, 7/15/11 40,710
40,000 4.400%, 7/15/12 40,780
40,000 4.400%, 7/15/13 40,827
40,000 4.400%, 7/15/14 40,848
40,000 4.400%, 7/15/15 40,797
40,000 4.400%, 7/15/16 40,678
4,000,000 State Economic Development
Authority RB, First Mortgage
Far Hills Country
5.500%, 9/01/24 3,863,440
1,065,000 State Economic Development
Authority RB, Wanaque
Convalescent Center Project,
Series A, (LOC: Sovereign Bank)
3.750%, 2/15/12 1,058,567
1,120,000 State Health Care Facilities
Authority RB, Catholic Health
East Issue, Series E (6)
4.524%, 11/15/33 1,042,070
State Higher Education Assistance
Authority RB, Series A,
AMT, AMBAC
990,000 5.200%, 6/01/13 995,801
1,055,000 4.950%, 6/01/10 1,055,728
16,165,000 Tobacco Settlement Authority RB
6.375%, 6/01/32 18,353,741
1,500,000 Union County, Industrial Pollution
Control RB, American
Cyanamid (GA: Wyeth)
5.800%, 9/01/09 1,528,545
Woodlynne GO
40,000 4.625%, 8/01/08 40,287
50,000 4.625%, 8/01/09 50,817
50,000 4.625%, 8/01/10 51,210
50,000 4.625%, 8/01/11 51,461
60,000 4.625%, 8/01/12 62,019
60,000 4.625%, 8/01/13 62,249
60,000 4.625%, 8/01/14 62,066
70,000 4.625%, 8/01/15 72,434
70,000 4.625%, 8/01/16 72,332
70,000 4.625%, 8/01/17 72,096
72,000 4.625%, 8/01/18 73,993
--------------
33,812,645
NEW MEXICO - 0.0%
45,000 State Mortgage Finance Authority
RB, Single-Family Mortgage,
Series B-2, AMT, GNMA,
FNMA, FHLMC
5.550%, 1/01/30 45,398
--------------
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 73
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
NEW YORK - 3.7%
3,600,000 Amherst, Industrial Development
Agency RB, Civic Facilities,
Daemen College Project, Series A,
Pre-Refunded @ 102 (2)
6.125%, 10/01/11 4,007,196
Freeport GO
100,000 4.500%, 8/01/09 101,576
100,000 4.500%, 8/01/10 102,331
100,000 4.500%, 8/01/11 102,913
100,000 4.500%, 8/01/12 102,967
125,000 4.500%, 8/01/13 129,019
125,000 4.500%, 8/01/14 129,017
125,000 4.500%, 8/01/15 128,519
125,000 4.500%, 8/01/16 128,157
150,000 Hempstead Town, Industrial
Development Agency RB,
Adelphi University Civic Facilities
5.250%, 2/01/13 154,993
115,000 Metropolitan Transportation
Authority RB, Commuter
Facilities, Series B, AMBAC, ETM
5.125%, 7/01/24 117,430
Metropolitan Transportation
Authority RB, Commuter
Facilities, Series D, MBIA, ETM
45,000 5.125%, 7/01/22 46,945
470,000 5.000%, 7/01/12 483,621
25,000 4.900%, 7/01/10 25,275
75,000 Metropolitan Transportation
Authority RB, Dedicated Tax
Fund, Series A, FGIC, ETM
5.250%, 4/01/14 76,274
Metropolitan Transportation
Authority RB, Grand Central
Terminal - 2, AMT, FSA, ETM
50,000 5.500%, 7/01/12 50,072
55,000 5.400%, 7/01/11 55,072
100,000 Metropolitan Transportation
Authority RB, Service Contract,
Series Q, AMBAC, ETM
5.125%, 7/01/12 101,122
375,000 Metropolitan Transportation
Authority RB, Service Contract,
Series R, ETM
5.500%, 7/01/11 383,542
State Dormitory Authority RB,
Concord Nursing Home, GNMA
3,605,000 5.500%, 2/15/30 3,839,577
810,000 4.150%, 8/15/17 808,283
State Dormitory Authority RB,
Non State Supported Debt,
Cabrini College Westchester, GNMA
4,500,000 5.200%, 2/15/41 4,732,830
4,800,000 4.800%, 8/15/25 4,896,576
Principal
Amount $ Value $
- -------------- --------------
200,000 State Environmental Facilities RB,
Corporate Pollution Control,
Water Revolving Fund, Series D, ETM
5.000%, 6/15/12 206,634
State Housing Finance Agency RB,
Capitol Green Apartments,
Series B, FNMA
500,000 4.375%, 11/15/17 491,420
1,000,000 4.200%, 11/15/14 1,001,010
960,000 State Housing Finance Agency RB,
Multi-Family Housing, Highland
Avenue Apartments, Series A, AMT,
SONYMA
4.700%, 2/15/17 983,165
205,000 State Urban Development RB,
Capital Appreciation (5)
5.746%, 1/01/11 170,072
55,000 State Urban Development RB,
Capital Appreciation, MBIA (5)
5.782%, 1/01/11 45,350
75,000 State Urban Development RB,
Capital Appreciation, Series O, FSA (5)
5.830%, 1/01/11 61,841
590,000 Triborough Bridge & Tunnel
Authority RB, General Purpose,
Series A, ETM
5.000%, 1/01/24 590,637
500,000 Triborough Bridge & Tunnel
Authority RB, General Purpose,
Series A, MBIA, ETM
5.000%, 1/01/24 501,365
50,000 Triborough Bridge & Tunnel
Authority RB, General Purpose,
Series B, ETM
5.100%, 1/01/10 50,864
--------------
24,805,665
NORTH CAROLINA - 0.1%
265,000 Mecklenburg County, Multi-Family
Housing RB, Little Rock
Apartments, AMT, FNMA
3.500%, 1/01/12 263,293
235,000 State Medical Care Community
Hospital RB, Saint Joseph
Hospital Project, AMBAC, ETM
5.100%, 10/01/14 235,280
--------------
498,573
NORTH DAKOTA - 0.1%
State Housing Finance Agency
RB, Housing Finance Program
Home Mortgage, Series B,
AMT, SPA-FHLB
250,000 4.125%, 7/01/11 248,855
210,000 4.000%, 7/01/10 208,763
--------------
457,618
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 74
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
OHIO - 5.7%
Buckeye, Tobacco Settlement RB,
Asset-Backed Senior Turbo,
Series A-2
9,050,000 6.000%, 6/01/42 8,958,233
2,000,000 5.875%, 6/01/30 1,971,600
4,000,000 5.750%, 6/01/34 3,852,320
150,000 Columbus, Sewer Improvement
Bonds GO, ETM
6.000%, 9/15/11 150,558
2,435,000 Cuyahoga County GO, MBIA
5.600%, 5/15/13 2,568,754
270,000 Germantown, Public Infrastructure
GO, Hickory Point
4.600%, 12/01/15 269,995
2,335,000 State Economic Development RB,
Heath Grains Bakery (8) (10)
5.840%, 12/01/25 2,309,478
State Higher Educational Facilities
RB, Kenyon College Project
2,500,000 4.850%, 7/01/37 2,602,350
1,000,000 4.700%, 7/01/37 1,031,340
1,080,000 State Housing Finance Agency
Mortgage RB, Residential
Mortgage-Backed Securities,
AMT, GNMA, FNMA
4.625%, 9/01/16 1,091,254
1,150,000 State Housing Finance Agency
RB, Residential Mortgage-Backed
Securities, Series F, GNMA,
FNMA (8)
5.437%, 3/01/09 1,149,195
11,150,000 Steubenville Hospital RB,
Trinity Health (6)
4.474%, 10/01/30 10,425,250
2,000,000 Summit County, Port Authority
Board RB, Cavaliers Practice,
Series D (8)
6.250%, 5/15/26 1,943,280
100,000 Wood County, Industrial
Development RB, Schutz
Container Systems Project,
Series B, (LOC: Bayerische
Hypo-und Vereinsbank) (6)
7.125%, 6/01/13 103,058
--------------
38,426,665
OKLAHOMA - 1.6%
2,365,000 Comanche County, Hospital
Authority RB, RADIAN
5.250%, 7/01/20 2,429,375
McAlester, Public Works
Authority RB, Series B (8)
1,195,000 7.100%, 9/01/18 1,213,068
515,000 7.000%, 9/01/17 522,416
485,000 6.900%, 9/01/16 491,795
455,000 6.800%, 9/01/15 461,247
Principal
Amount $ Value $
- -------------- --------------
470,000 State Home Finance Authority RB,
Single-Family Mortgage, Series B,
AMT, GNMA, FNMA, FHLMC
4.250%, 9/01/25 471,974
145,000 Tulsa County, Home Finance
Authority RB, Single-Family
Mortgage, FGIC, ETM
6.900%, 8/01/10 151,998
2,500,000 Tulsa, Industrial Authority TA,
Series A (8)
7.350%, 1/01/17 2,549,625
2,500,000 Tulsa, Industrial Authority TA,
Series B (8)
7.300%, 7/01/16 2,535,050
--------------
10,826,548
OREGON - 0.2%
710,000 Portland, Housing Authority RB,
New Columbia Development,
Capital Funding Program, AMT
4.300%, 10/01/15 707,238
475,000 State Facilities Authority RB,
College Inn Student Housing,
Series B
6.250%, 7/01/11 477,879
--------------
1,185,117
PENNSYLVANIA - 13.0%
Abington Township, Municipal
Authority RB, Marywood
University Project, RADIAN
705,000 4.450%, 6/01/20 678,132
730,000 4.450%, 6/01/21 696,967
675,000 4.400%, 6/01/19 651,078
650,000 4.250%, 6/01/18 624,234
195,000 Allegheny County, Hospital
Development Authority RB,
Childrens Hospital of Pittsburgh,
MBIA, ETM
5.300%, 7/01/26 207,168
725,000 Allegheny County, Hospital
Development Authority RB,
Jefferson Regional Medical
Center, Series B
5.000%, 5/01/18 730,495
60,000 Allegheny County, Hospital
Development Authority RB,
Pittsburgh Mercy Health Systems,
AMBAC, ETM
5.625%, 8/15/26 60,955
Allegheny County, Redevelopment
Authority TA, Waterfront Project,
Series B
125,000 4.250%, 12/15/12 125,969
160,000 4.000%, 12/15/10 160,366
165,000 4.000%, 12/15/11 165,119
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 75
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
Allegheny County, Residential
Financial Authority RB, Single-
Family Mortgage, Series VV, AMT,
GNMA, FNMA
1,295,000 4.900%, 11/01/27 1,272,325
2,330,000 4.800%, 11/01/22 2,300,572
10,000 Berks County GO, Second Series, MBIA
3.300%, 11/15/09 9,968
400,000 Chester, Upland School District GO
4.200%, 5/15/13 401,804
970,000 Chester, Upland School District GO,
XLCA
4.850%, 9/15/16 1,030,964
100,000 Dauphin County, General Authority
RB, AMBAC, Mandatory Put (7)
4.550%, 6/01/26 100,548
80,000 Dauphin County, General Authority
RB, Hapsco-Western Pennsylvania
Hospital Project, Series A-1, MBIA, ETM
5.500%, 7/01/13 84,474
1,660,000 Delaware County, Hospital Revenue
Authority RB, Crozer Keystone
Obligation Group, Series A
5.000%, 12/15/19 1,663,519
17,000,000 Delaware Valley Regional Financial
Authority RB, Series C (6)
4.490%, 6/01/37 16,014,510
35,000 Erie, Higher Education Building
Authority RB, Gannon University
Project, AMBAC, ETM
7.375%, 6/01/08 35,664
1,525,000 Harrisburg, Parking Authority RB,
Series R, XLCA
4.250%, 5/15/21 1,511,336
40,000 Hempfield, School District GO, ETM
7.200%, 10/15/09 41,963
845,000 Lancaster County, School
District GO, FSA
4.250%, 6/01/25 816,997
185,000 Lancaster County, School
District GO, Series A, FSA
4.000%, 6/01/20 181,052
2,650,000 Lehigh County, General Purpose
Authority RB, St. Lukes Hospital
Bethlehem (6)
4.744%, 8/15/42 2,345,250
Monroe County, Hospital
Authority RB, Pocono Medical Center
620,000 5.000%, 1/01/14 631,476
310,000 5.000%, 1/01/17 313,388
1,675,000 Monroe County, Hospital Authority
RB, Pocono Medical Center,
Pre-Refunded @100 (2)
6.000%, 1/01/14 1,882,633
Principal
Amount $ Value $
- -------------- --------------
4,005,000 Montgomery County, Industrial
Development Authority RB,
Montenay Project, Series A, MBIA
5.250%, 11/01/13 4,328,003
1,500,000 Philadelphia, Authority for Industrial
Development RB, Commercial
Development, Red Lion, AMT,
Mandatory Put,
(LOC: PNC Bank, N.A.) (7) (8)
4.500%, 12/01/16 1,496,070
585,000 Philadelphia, Authority for
Industrial Development RB,
Russell Byers Charter School, Series A
4.900%, 5/01/17 584,386
975,000 Philadelphia, Multi-Family Housing
Redevelopment Authority RB,
Pavilion Apartments Project,
Series A, AMT, HUD Section 236
4.250%, 10/01/16 965,269
3,500,000 Philadelphia, School District GO,
Series B, FGIC, Pre-Refunded @ 100 (2)
5.625%, 8/01/12 3,816,260
500,000 Philadelphia, School District GO,
Series D, FSA
5.000%, 6/01/15 537,250
6,150,000 Saint Mary's Hospital Authority RB,
Catholic Health East Issue, Series F (6)
4.554%, 11/15/34 5,687,643
4,785,000 Scranton, Redevelopment Authority
RB, RADIAN (8)
6.100%, 11/01/24 4,681,118
310,000 State Higher Education Facilities
Authority RB, St. Francis
Independent Colleges-Universities
5.000%, 11/01/11 313,174
755,000 State Higher Educational Facilities
Authority RB, Allegheny Delaware
Valley Obligation, Series A, MBIA
5.700%, 11/15/11 816,276
State Higher Educational Facilities
Authority RB, Assigned Independent
Colleges & Universities, RADIAN
405,000 4.125%, 5/01/12 403,437
375,000 4.000%, 5/01/10 374,734
390,000 4.000%, 5/01/11 388,491
State Higher Educational Facilities
Authority RB, Indiana University,
Series A, XLCA (6)
14,250,000 4.154%, 7/01/39 13,495,320
8,155,000 4.104%, 7/01/27 7,962,542
5,090,000 State Turnpike Common Oil RB,
Series A, AMBAC, ETM
5.000%, 12/01/15 5,220,966
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 76
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
1,610,000 State University RB, GO of University
5.000%, 9/01/24 1,685,284
--------------
87,495,149
RHODE ISLAND - 0.4%
1,575,000 Providence, Housing Authority RB,
New Canonchet Project, Series A,
AMT, GNMA
5.000%, 7/01/38 1,515,197
55,000 State Depositors Economic
Protection RB, Series B, MBIA, ETM
6.000%, 8/01/17 59,913
180,000 State Health & Educational Building
Authority RB, Capital Appreciation,
BIG (5)
6.168%, 11/01/12 132,925
Woonsocket, Housing Authority RB,
Capital Funds Housing Project
385,000 4.500%, 9/01/10 395,807
400,000 4.500%, 9/01/11 413,780
420,000 4.500%, 9/01/12 435,422
--------------
2,953,044
SOUTH CAROLINA - 1.0%
385,000 Greenville County, Airport RB,
Donaldson Industrial Air Park
Project, AMT
6.125%, 10/01/17 391,410
135,000 Piedmont, Municipal Power Agency
RB, Capital Appreciation, Series A,
AMBAC (5)
9.758%, 1/01/15 91,136
State Educational Facilities Authority
RB, Non-Profit Institutions,
Wofford College Series A
360,000 4.500%, 4/01/20 357,282
375,000 4.500%, 4/01/21 370,155
750,000 4.500%, 4/01/30 704,572
330,000 4.250%, 4/01/18 323,994
345,000 4.250%, 4/01/19 335,851
3,560,000 State Jobs Economic Development
Authority RB, Palmetto Health,
Series C, Pre-Refunded @ 100 (2)
6.875%, 8/01/13 4,143,342
--------------
6,717,742
SOUTH DAKOTA - 0.2%
1,065,000 Heartland Consumers Power
District RB, ETM
7.000%, 1/01/16 1,191,341
--------------
TENNESSEE - 0.6%
455,000 Nashville & Davidson Counties,
Metropolitan Government Cab
Converter RB, FGIC
7.700%, 1/01/12 501,014
Principal
Amount $ Value $
- -------------- --------------
500,000 Nashville & Davidson Counties,
Metropolitan Government Health
& Educational Facilities
Board RB, RADIAN
5.100%, 8/01/16 501,970
1,500,000 Nashville & Davidson Counties,
Multi-Family Housing RB, River
Retreat, Series A, FNMA
4.750%, 11/01/26 1,452,555
State School Board Authority RB,
Series B (9)
40,000 5.250%, 5/01/10 40,452
1,275,000 5.000%, 5/01/09 1,289,165
50,000 Wilson County, Health &
Educational Facilities Board RB,
University Medical Center, ETM
8.375%, 8/01/08 51,380
--------------
3,836,536
TEXAS - 7.0%
2,020,000 Allen, Independent School District
GO, Capital Appreciation, PSF,
Pre-Refunded @ 40.017 (2) (5)
5.977%, 2/15/10 742,936
2,025,000 Allen, Independent School District
GO, Capital Appreciation, PSF,
Pre-Refunded @ 42.722 (2) (5)
5.938%, 2/15/10 795,137
145,000 Brownsville GO, Capital
Appreciation, AMBAC (5)
6.437%, 2/15/11 118,759
Canton, Independent School
District GO, School Building
Authority, PSF
625,000 4.600%, 2/15/23 631,744
375,000 4.500%, 2/15/21 379,526
4,980,393 Central Texas, Single-Family Housing
Financial Corporation RB,
Mortgage-Backed Securities
Program, Series A-1, GNMA, FNMA
4.700%, 12/01/39 5,053,953
Commerce, Independent School
District GO, Capital Appreciation
School, Building, PSF (5)
740,000 6.280%, 8/15/10 667,709
565,000 4.040%, 8/15/09 529,507
Commerce, Independent School
District GO, School Building
Authority, PSF
1,075,000 4.600%, 8/15/23 1,087,105
1,130,000 4.600%, 8/15/24 1,139,334
985,000 4.500%, 8/15/21 997,401
1,035,000 4.500%, 8/15/22 1,042,276
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 77
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
De Soto GO, CIFG
390,000 4.375%, 2/15/24 380,039
330,000 4.250%, 2/15/23 318,806
340,000 4.200%, 2/15/22 329,106
345,000 4.125%, 2/15/21 335,005
330,000 4.100%, 2/15/20 323,611
20,000 Denison, Hospital Authority RB,
Texoma Medical Center, ETM
7.125%, 7/01/08 20,409
Fort Bend County, Municipal
Utility District No. 23 GO, FGIC
45,000 6.500%, 9/01/08 46,108
65,000 6.500%, 9/01/09 68,453
70,000 6.500%, 9/01/10 75,555
45,000 6.500%, 9/01/11 49,648
95,000 5.000%, 9/01/16 99,460
250,000 Greater Greenspoint, Redevelopment
Authority RB, Tax Increment
Contract, RADIAN
5.250%, 9/01/10 257,738
7,475,000 Harris County RB, Series B, AMBAC (6)
4.368%, 8/15/35 7,082,563
195,000 Harris County, Health Facilities
Development RB, St. Lukes
Episcopal Hospital Project, ETM
6.625%, 2/15/12 200,236
135,000 Houston, Airport System RB, ETM
7.600%, 7/01/10 142,817
100,000 Houston, Apartment Systems RB,
Series A, AMT, FGIC
5.000%, 7/01/19 102,027
10,000 Houston, Sewer System RB,
FGIC, ETM
6.375%, 10/01/08 10,219
Lewisville, Combination Contract
GO, Special Assessment Capital
District 2, ACA (1)
2,000,000 5.875%, 9/01/22 2,077,640
3,545,000 5.625%, 9/01/17 3,677,299
Retama, Development Corporate
Special Facilities RB, Retama
Racetrack, ETM (8)
2,000,000 10.000%, 12/15/17 2,737,180
500,000 8.750%, 12/15/11 569,030
San Leanna, Educational Facilities
Higher RB, Saint Edwards
University Project
1,165,000 5.000%, 6/01/16 1,199,356
500,000 5.000%, 6/01/17 513,780
500,000 5.000%, 6/01/19 508,745
50,000 Sendero, Public Facilities RB,
Crown Meadows Project,
Series A, FHLMC
4.250%, 6/01/13 50,626
Principal
Amount $ Value $
- -------------- --------------
Sienna, Plantation Levee
Improvement GO, FSA
430,000 4.750%, 9/01/23 440,428
450,000 4.750%, 9/01/24 459,716
1,335,000 4.500%, 9/01/31 1,298,755
1,500,000 South Lake GO, AMBAC,
Pre-Refunded @ 26.765 (2) (5)
6.273%, 2/15/09 383,205
3,145,000 South Lake GO, AMBAC,
Pre-Refunded @ 32.616 (2) (5)
6.210%, 2/15/09 979,101
1,155,000 State Department Housing &
Community RB, Summit
Point Apartments, GNMA
4.800%, 6/20/18 1,165,591
7,400,000 State Municipal Gas Acquisition
& Supply RB (6)
4.685%, 9/15/27 7,030,000
745,000 Travis County, Health Facility
Development RB, Daughters
of Charity, MBIA, ETM
5.000%, 11/01/20 745,693
455,000 West Central, Regulation Housing
Financial RB, Mortgage-Backed
Securities Program, Series A,
AMT, GNMA, FNMA, FHLMC
5.350%, 12/01/39 473,532
--------------
47,336,864
UTAH - 0.5%
30,000 Intermountain Power Agency RB,
Series A, ETM
5.000%, 7/01/21 30,034
1,000,000 State Environmental RB, Marathon
Oil Project (6)
5.050%, 11/01/17 1,031,110
1,315,000 State Housing Corporation,
Single-Family Mortgage RB,
Series C-1, Class III
4.850%, 7/01/27 1,309,148
1,000,000 State Housing Corporation,
Single-Family Mortgage RB,
Series G, Class III, AMT
4.700%, 7/01/28 954,120
--------------
3,324,412
VIRGINIA - 1.6%
725,000 Norfolk, Packaging Systems RB,
Series A, MBIA
4.000%, 2/01/19 713,342
26,500,000 Pocahontas Parkway Association,
Toll Road RB, Capital
Appreciation, Series B,
Pre-Refunded @ 40.387 (2) (5)
3.700%, 8/15/08 10,408,405
--------------
11,121,747
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 78
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
WASHINGTON - 0.1%
356,375 Nooksack, Indian Tribe RB
5.500%, 2/23/11 351,899
--------------
WEST VIRGINIA - 0.3%
545,000 State Economic Development
Authority, Industrial Development
RB, Central Supply Project,
AMT, (LOC: BB&T)
5.500%, 5/15/10 548,057
2,000,000 State Jobs Investment Trust Board RB,
Promissory Notes, Series D (5) (8)
6.292%, 7/31/13 1,422,380
--------------
1,970,437
WISCONSIN - 0.8%
2,985,000 Franklin, Solid Waste Disposal RB,
Waste Management Conversion,
AMT (6)
4.950%, 4/01/16 3,008,193
800,000 Kronenwetter, Anticipation Notes
4.750%, 3/01/11 805,704
1,365,000 Oshkosh, Industrial Development
Authority RB, Don Evans Project,
AMT, Mandatory Put,
(LOC: Marshall & Ilslay) (7)
5.500%, 12/01/21 1,372,576
50,000 State Health & Educational
Facilities RB, ACA,
Pre-Refunded @100 (2)
6.000%, 5/15/08 50,669
10,000 State Transportation RB, Series A
5.500%, 7/01/11 10,675
60,000 Winnebago County,
Promissory Notes GO
4.375%, 4/01/12 61,093
--------------
5,308,910
--------------
TOTAL MUNICIPAL BONDS
(Cost $661,831,198) 656,401,399
--------------
CORPORATE OBLIGATIONS - 0.5%
359,000 BFL Funding VI (10)
5.000%, 4/01/08 359,000
273,501 IIS/Syska Holdings Energy (10)
3.900%, 8/15/08 267,930
250,000 Kidspeace National Centers
of Georgia, USDA (1) (3) (4) (6)
6.300%, 12/01/28 262,947
776,560 Landmark Leasing (10)
6.200%, 10/01/22 795,137
1,869,524 Niagara Elmwood (1) (8)
6.120%, 12/15/11 1,888,350
--------------
TOTAL CORPORATE
OBLIGATIONS
(Cost $3,527,918) 3,573,364
--------------
Shares Value $
- -------------- --------------
SHORT-TERM INVESTMENT - 1.0%
6,732,945 BlackRock Institutional Muni
Fund Portfolio, 3.33% (11) 6,732,945
--------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $6,732,945) 6,732,945
--------------
TOTAL INVESTMENTS - 98.9%
(Cost $672,092,061) 666,707,708
--------------
OTHER ASSETS LESS
LIABILITIES - 1.1% 7,481,212
--------------
NET ASSETS - 100.0% $ 674,188,920
==============
(1) Private Placement Security.
(2) Pre-Refunded Security -- The maturity date shown is the pre-refunded date.
(3) Security considered illiquid. On October 31, 2007 the value of these
securities amounted to $638,849 representing 0.1% of the net assets of the
Fund.
(4) Security considered restricted. (See Note 2 in Notes to Financial
Statements).
(5) Zero Coupon Security -- Rate disclosed is the effective yield at time of
purchase.
(6) Variable Rate Security -- Rate disclosed is as of October 31, 2007.
(7) Mandatory Put Security -- The mandatory put date is shown as the maturity
date on the Schedule of Investments.
(8) Security is taxable.
(9) Economically Defeased Security.
(10) Security exempt from registration under Rule 144A of the Securities Act of
1933. This security may be resold in transactions exempt from registration
normally to qualified institutions. On October 31, 2007, the value of
these securities amounted to $3,731,545, representing 0.6% of the net
assets of the Fund.
(11) Rate shown is the 7-day effective yield as of October 31, 2007.
(12) Security purchased on a when-issued basis.
AMT -- Income from security may be subject to alternative minimum tax.
BAN -- Bond Anticipation Note
CIFG -- Cornell/Intel Faculty Group
COP -- Certificate of Participation
ETM -- Escrowed to Maturity
FHLB -- Federal Home Loan Bank
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
GA -- Guaranteed Agreement
GNMA -- Government National Mortgage Association
GO -- General Obligation
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 79
- --------------------------------------------------------------------------------
SCHRODER MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
HUD -- Department of Housing and Urban Development
LOC -- Letter of Credit
NA -- National Association
RB -- Revenue Bond
SA -- Special Assessment
TA -- Tax Allocation
TAN -- Tax Anticipation Note
Guaranteed as to principal and interest by the organization identified below:
ACA -- American Capital Access
ADFA -- ADFA Guaranty
AMBAC -- American Municipal Bond Assurance Corporation
BIG -- BIG Guaranty
FGIC -- Federal Guaranty Insurance Company
FHA -- Federal Housing Administration
FSA -- Financial Security Assurance
MBIA -- Municipal Bond Investors Assurance
PSF -- PSF Guaranty
RADIAN -- RADIAN Guaranty
SONYMA -- SONYMA Guaranty
SPA -- SPA Guaranty
USDA -- USDA Guaranty
XLCA -- XL Capital Assurance
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 80
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
MUNICIPAL BONDS - 96.0%
ALABAMA - 0.2%
565,000 Montgomery Medical Clinic Board
RB, Jackson Hospital & Clinic
5.000%, 3/01/11 574,317
--------------
ARIZONA - 1.7%
4,000,000 Arizona Health Facilities, Banner
Health RB, Series B (1)
4.315%, 1/01/37 3,718,160
50,000 Maricopa County, Hospital RB,
Intermediate Community-Sun
City, ETM
8.625%, 1/01/10 52,597
59,000 Maricopa County, Hospital RB,
St. Lukes Hospital Medical
Center Project, ETM
8.750%, 2/01/10 62,528
100,000 Pima County, Industrial Development
Authority RB, Tucson Country
Day School Project
4.000%, 6/01/08 99,621
140,000 Pinal County, Industrial Development
Authority, Correctional Facilities RB,
Florence West Prison, Series A, ACA
3.875%, 10/01/09 138,915
--------------
4,071,821
ARKANSAS - 3.5%
250,000 Fayetteville, Sales & Use Tax RB, FSA
4.125%, 11/01/26 248,668
1,260,000 Fayetteville, Sales & Use Tax RB,
Series A, FSA
4.000%, 11/01/21 1,270,660
105,000 Fayetteville, Sales & Use Tax SA
2.750%, 12/01/09 104,878
1,900,000 Fayetteville, Sales & Use Tax SA,
ETM, 6.8% of original issue
Pre-Refunded to 12/01/07 @ 100 (9)
2.500%, 12/01/08 1,870,930
130,000 Little Rock, Library Construction
Improvement GO, Series A
4.350%, 3/01/24 129,844
1,225,000 Marion, Sales & Use Tax RB,
Capital Improvement
4.850%, 9/01/32 1,236,429
1,915,000 Rogers GO, XLCA
4.250%, 3/01/31 1,926,892
115,000 Rogers, Sales & Use Tax RB,
Series A, FGIC
4.125%, 9/01/23 114,868
1,635,000 Springdale, Sales & Use
Tax RB, MBIA
4.000%, 7/01/16 1,658,086
--------------
8,561,255
Principal
Amount $ Value $
- -------------- --------------
CALIFORNIA - 5.1%
516,001 Alexander Valley, School District Lease
Certificates RB, Flexfund Program
4.250%, 7/01/14 520,464
2,200,000 California Health Facilities Funding
Authority RB, California-Nevada-
Methodist Project
4.250%, 7/01/11 2,209,394
4,750,000 Long Beach, Financial Authority RB,
Natural Gas Purification, Series B (1)
5.230%, 11/15/25 4,631,250
4,540,000 Manteca, Financing Authority Sewer
RB, Series B, MBIA
5.000%, 12/01/33 4,555,164
345,000 Placer County, Water Agency RB,
Middle Fork Project
3.750%, 7/01/12 342,506
55,000 Sacramento County, Sanitation
District RB, ETM
5.000%, 12/01/08 55,064
235,000 Statewide Communities,
Development Authority RB,
Warwick Terrace Apartments,
Series H, (LOC: City National Bank)
4.800%, 4/15/19 228,815
--------------
12,542,657
COLORADO - 7.8%
7,220,000 Adonea, Metropolitan District
No. 2 RB, Series B, (LOC:
Compass Bank)
4.375%, 12/01/15 7,288,373
2,320,000 Beacon Point, Metropolitan District
RB, Series B, (LOC: Compass Bank)
4.375%, 12/01/15 2,340,277
20,000 Denver City & County Multi-Family
Housing RB, Buerger Brothers
Project, Series A, AMT, FHA
5.100%, 11/01/07 20,000
3,000,000 Denver Health & Hospital
Authority RB, Series B (1)
4.839%, 12/01/33 2,715,000
750,000 Denver International Business
Center GO, Metropolitan District
No. 1, (LOC: Compass Bank) (5)
4.000%, 12/01/31 749,813
120,000 El Paso County, Academy Water &
Sanitation District GO
3.650%, 11/15/07 119,974
1,440,000 High Plains, Metropolitan District
RB, (LOC: Compass Bank)
4.375%, 12/01/15 1,463,501
1,110,000 Maher Ranch, Metropolitan District
No. 4 GO, RADIAN
4.375%, 12/01/13 1,114,906
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 81
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
2,245,000 State Health Facilities Authority RB,
Catholic Health, Series A, ETM
5.500%, 3/01/22 2,400,556
345,000 State Health Facilities Authority RB,
Volunteers of America Care, Series A
5.000%, 7/01/08 345,224
160,000 State Housing & Finance Authority
RB, Single-Family Program
Series C-2, AMT
8.400%, 10/01/21 169,458
255,000 State Housing & Finance Authority
RB, Single-Family Project,
Series D2, AMT
6.350%, 11/01/29 266,013
--------------
18,993,095
DELAWARE - 0.8%
1,160,000 State Economic Development
Authority RB, Water Development,
Wilmington Suburban, Series B
6.450%, 12/01/07 1,162,563
620,000 State Health Facilities Authority RB,
Beebe Medical Center Project,
Series A
5.000%, 6/01/08 623,553
105,000 State Housing Authority RB,
Single-Family Mortgage,
Series A-1, AMT, MBIA
5.300%, 7/01/11 106,174
--------------
1,892,290
DISTRICT OF COLUMBIA - 0.1%
175,000 Housing Finance Agency RB,
1330 7th Street Apartments,
Series A, AMT, FHA
3.000%, 12/01/09 172,676
--------------
FLORIDA - 0.4%
5,000 Dunedin, Health Facilities
Authority RB, Mease Hospital, ETM
7.600%, 10/01/08 5,146
310,000 Florida State Board of Education
GO, Public Education School
Improvements, Series C, ETM
6.000%, 5/01/08 312,995
5,000 Florida State GO, ETM
5.900%, 7/01/08 5,061
425,000 Florida State, Board Registered
Parking System RB, University
of Florida, MBIA
5.000%, 8/01/10 425,501
190,000 Hollywood Community Redevelopment
Agency RB, Beach CRA
5.000%, 3/01/08 190,572
Principal
Amount $ Value $
- -------------- --------------
100,000 Jacksonville, Electric Authority RB,
Third Installment, ETM
6.800%, 7/01/12 108,120
--------------
1,047,395
GEORGIA - 1.2%
920,000 Cobb County, Kennestone Hospital
Authority RB, Capital Appreciation
Certificates, Series 86A, MBIA,
ETM (6)
17.388%, 8/01/15 575,258
490,000 Hapeville, Development Authority RB,
Intergovernmental (2) (3) (4) (5)
6.500%, 8/01/09 496,385
1,375,000 Randolph County, Sales Tax GO
3.210%, 4/01/12 1,352,876
385,000 State Housing & Finance Authority
RB, Single-Family Mortgage
Program, Sub-Series D-3 (1)
4.850%, 6/01/17 388,434
--------------
2,812,953
IDAHO - 0.2%
205,000 State Housing & Finance Association
RB, Single-Family Mortage
Program, Series C, Class I, AMT
4.125%, 7/01/32 205,029
235,000 State Housing & Finance Association
RB, Single-Family Mortgage
Program, Series A-2, Class I, AMT
3.125%, 7/01/33 232,610
30,000 State Housing & Finance Association
RB, Single-Family Mortgage
Program, Sub-Series G-2, AMT
5.750%, 1/01/14 30,065
20,000 State Housing & Finance Association
RB, Single-Family Mortgage Program,
Sub-Series H-2, AMT, FHA
5.850%, 1/01/14 20,345
--------------
488,049
ILLINOIS - 6.8%
5,000,000 Bartlett, Quarry Redevelopment
Project TA (5)
5.350%, 1/01/17 5,071,950
5,000,000 Bolingbrook, Sales Tax RB (8)
5.150%, 1/01/26 5,088,750
400,000 Broadview GO
4.000%, 12/01/07 399,884
800,000 Cary, Special Tax, Special Service
Area No. 1, RADIAN
4.400%, 3/01/16 791,272
20,000 Chicago, Single-Family Mortgage RB,
Series B, AMT, GNMA, FNMA,
FHLMC
6.950%, 9/01/28 20,534
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 82
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
765,000 McCook, British Home Project RB,
(LOC: LaSalle Bank NA)
4.250%, 12/01/14 765,084
105,000 Pekin, Single-Family Mortgage
RB, ETM
7.400%, 12/01/08 107,717
4,029,000 Pingree Grove, Special Services Area,
Cambridge Lakes Project, Series 05-1
5.250%, 3/01/15 4,053,053
415,000 State Health Facilities Authority RB,
Lutheran General Health Systems,
Series C, FSA
7.000%, 4/01/08 420,619
--------------
16,718,863
INDIANA - 0.8%
65,000 Allen County, Redevelopment District
Tax Increment TA, I-469 Bluffton
Road Economic Development Project
5.800%, 11/15/07 65,018
1,095,000 Carmel, Industrial Redevelopment
BAN, District Golf
5.250%, 2/01/09 1,091,244
350,000 Hamilton County, Industrial
Redevelopment TA, District Tax
Increment Revenue
3.850%, 1/10/10 349,038
100,000 Lawrence, Multi-Family Housing RB,
Pinnacle Apartments Project, AMT,
FNMA, Mandatory Put (7)
5.150%, 6/01/24 100,240
105,000 State Health Facilities Financing
Authority RB, Unrefunded,
Series A, MBIA
5.000%, 11/01/09 107,207
285,000 State Housing Finance Authority RB,
Single-Family Mortgage, Series A-3,
AMT, GNMA, FNMA
5.375%, 1/01/23 287,229
--------------
1,999,976
IOWA - 1.4%
3,470,000 Coralville GO, BAN, Urban
Renewal, Series D
4.250%, 6/01/09 3,481,104
5,000 Sioux City, Hospital RB, Series O,
MBIA, ETM
5.250%, 8/15/10 5,007
--------------
3,486,111
KANSAS - 5.4%
2,750,000 Junction City GO, Temporary
Notes, Series B (5)
6.000%, 6/01/08 2,758,140
2,500,000 Junction City GO, Temporary
Notes, Series E
5.000%, 12/01/07 2,501,425
Principal
Amount $ Value $
- -------------- --------------
2,195,000 Mission GO, Temporary Notes,
Series 2 (5)
5.500%, 6/01/08 2,195,681
1,760,000 Sedgwick & Shawnee Counties,
Single-Family Mortgage RB,
Series A, AMT, GNMA, FNMA (8)
5.600%, 6/01/27 1,813,011
1,500,000 Sedgwick & Shawnee Counties,
Single-Family Mortgage RB,
Series A-2, AMT, GNMA, FNMA
5.600%, 6/01/29 1,586,160
945,000 Wyandotte County, Sales Tax RB,
1st Lien, Area B, (LOC:
Citibank NA)
3.750%, 12/01/12 943,894
1,400,000 Wyandotte County, Sales Tax RB,
1st Lien, Area C, (LOC:
Citibank NA)
3.850%, 12/01/13 1,400,266
--------------
13,198,577
KENTUCKY - 1.5%
1,260,000 State Area Development Districts
Financing GO, Henderson,
Series G1 Pre-Refunded @102 (2) (9)
5.750%, 12/01/07 1,286,208
1,855,000 State Economic Development
Authority RB, Norton Healthcare,
Series C, MBIA, ETM
5.500%, 10/01/11 1,987,521
25,000 State Turnpike Authority RB, ETM (1)
6.625%, 7/01/08 25,441
290,000 State Turnpike Authority RB,
Resource Recovery Redevelopment,
Series A, ETM
5.000%, 7/01/08 291,836
35,000 State Turnpike Authority Toll
Road RB, ETM
6.125%, 7/01/08 35,475
--------------
3,626,481
LOUISIANA - 3.1%
125,000 Calcasieu Parish, Public
Transportation Authority RB,
Single-Family Mortgage,
Series A, AMT, GNMA, FNMA
5.850%, 10/01/32 126,060
5,847,374 Jefferson Parish, Financial Authority
RB, Single-Family Mortgage,
Series A, AMT (1) (2)
4.610%, 3/01/39 5,847,374
40,000 Jefferson Parish, Hospital Service
District No. 1 RB, ETM
7.250%, 1/01/09 40,854
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 83
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
1,065,000 Louisiana Local Government,
Environment Facilities RB,
Southeastern Louisiana University,
Series B, MBIA
4.375%, 2/01/37 1,017,874
40,000 Monroe-West Monroe, Single-Family
Mortgage RB, ETM
7.200%, 8/01/10 41,923
55,000 Orleans Parish, School Board GO,
MBIA, ETM (6)
7.018%, 2/01/08 54,417
425,000 State Multi-Family Housing
Finance Agency RB, Section 8-202
Project, Series A
3.950%, 12/01/09 426,254
15,000 State Public Facilities Authority
Hospital RB, Pendleton Memorial
Methodist Hospital, ETM
5.000%, 6/01/08 15,128
--------------
7,569,884
MARYLAND - 1.3%
Annapolis, Economic Development
RB, Saint Johns College Facilities,
Series A
80,000 4.500%, 10/01/08 80,411
85,000 4.500%, 10/01/09 85,853
90,000 4.250%, 10/01/10 90,562
Annapolis, Economic Development
RB, Saint Johns College Facilities,
Series B
45,000 4.500%, 10/01/08 45,231
60,000 4.250%, 10/01/10 60,374
2,180,000 Baltimore, Unrefunded Capital
Appreciation GO, Series A,
FGIC (6)
6.046%, 10/15/09 1,940,265
880,000 State Health & Higher Education
RB, Howard County General
Hospital, ETM
5.500%, 7/01/13 902,132
--------------
3,204,828
MICHIGAN - 1.0%
700,000 Detroit/Wayne County, Stadium
Authority RB, FGIC
5.250%, 2/01/09 714,728
280,000 Grand Valley, State University RB,
AMBAC
5.150%, 10/01/09 283,021
960,000 Kalamazoo, Hospital Finance
Authority RB, Borgess Medical
Center, Series A, AMBAC, ETM
5.500%, 6/01/08 971,156
Principal
Amount $ Value $
- -------------- --------------
360,000 Kalamazoo, Hospital Finance
Authority RB, Bronson
Methodist, MBIA
5.500%, 5/15/08 363,823
150,000 State Hospital Financial Authority
RB, Oakwood Obligated Group
5.000%, 11/01/07 150,000
--------------
2,482,728
MINNESOTA - 0.8%
240,000 Alexandria, Industrial Development
RB, Seluemed Limited LLP
Project, AMT, (LOC: First
Trust NA)
5.300%, 3/01/10 240,153
895,000 Burnsville, Hospital System RB,
Fairview Community Hospitals,
ETM (6)
4.034%, 5/01/12 683,950
135,000 Dakota County, Community
Development Agency RB,
Commons on Marice Project,
Series A
4.250%, 11/01/07 135,000
810,000 State Housing Finance Agency RB,
Residential Housing Financing,
Series B, AMT
4.800%, 7/01/23 812,568
--------------
1,871,671
MISSISSIPPI - 0.7%
1,235,000 Mississippi Business Finance RB,
TT&W Farm Products Project,
AMT, (LOC: National Bank)
6.900%, 7/01/10 1,239,582
425,000 Mississippi Hospital Equipment
& Facilities Authority RB,
Hospital South Central
4.000%, 12/01/07 424,906
--------------
1,664,488
MISSOURI - 3.6%
990,000 Boone County, Industrial
Development Authority RB,
Otscon Project, AMT, Mandatory
Put, (LOC: Boone County
National Bank) (1) (7)
4.750%, 5/01/18 970,339
500,000 Fort Zumwalt, School District GO,
Pre-Refunded @ 100 (9)
6.500%, 3/01/08 505,005
Pacific, Industrial Development
Authority RB, Clayton Project,
AMT, (LOC: Commerce Bank NA)
720,000 6.450%, 5/01/17 721,354
630,000 6.200%, 5/01/12 631,046
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 84
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
2,750,000 Riverside, Industrial Development
Authority RB, Riverside Horizons
Project, Series B, ACA
4.500%, 5/01/27 2,583,322
100,000 St. Charles County, Industrial
Development Authority RB,
Garden View Care Center Project,
AMT, (LOC: U.S. Bank NA)
5.400%, 11/15/16 100,611
2,000,000 State Environmental Implementation
& Energy, Pollution Control RB,
Association Electric Coop
Thomas Hill
5.500%, 12/01/11 2,023,000
1,250,000 Waynesville COP, RADIAN
4.200%, 4/01/17 1,235,412
--------------
8,770,089
MONTANA - 0.0%
20,000 State Board Investment RB, Payroll
Tax Workers Compensation
Project, MBIA, ETM
6.875%, 6/01/11 20,738
--------------
NEBRASKA - 0.0%
100,000 Madison County, Hospital Authority
RB, Faith Regional Healthcare
Services Project, RADIAN
4.850%, 7/01/09 101,417
--------------
NEVADA - 2.1%
5,200,000 Clark County, Pollution Control
RB, Nevada Power Company
Project, ACA
5.300%, 10/01/11 5,200,156
35,000 State Municipal Bond GO,
Project No. 28-31-C, ETM
7.200%, 1/01/09 35,570
--------------
5,235,726
NEW JERSEY - 7.3%
3,895,000 Atlantic City, Municipal Utilities
Authority RB, Sub-Water
Systems (2) (3) (4)
5.000%, 1/01/08 3,899,635
2,000,000 Atlantic Highlands GO (5)
4.250%, 11/15/07 2,000,100
1,000,000 Haddon Township BAN (5)
5.625%, 2/15/08 1,001,070
5,000 Hudson County GO
5.125%, 8/01/08 5,050
200,000 Passaic Valley, Sewer Systems RB,
Series D, ETM, AMBAC
5.750%, 12/01/07 200,336
Principal
Amount $ Value $
- -------------- --------------
150,000 State Economic Development
Authority RB, Newark Downtown
District Management
4.500%, 6/15/08 150,350
850,000 State Economic Development
Authority RB, Seabrook Income,
Series A, Pre-Refunded @ 101 (9)
8.000%, 11/15/10 966,730
1,990,000 State Health Care Facilities Authority
RB, Catholic Health East Issue,
Series E (1)
4.524%, 11/15/33 1,851,536
125,000 State Health Care Facilities Financing
Authority RB, Allegany Health,
Our Lady of Lourdes, ETM, MBIA
5.000%, 7/01/08 125,545
State Higher Education Assistance
Authority RB, Series A, AMT,
AMBAC
885,000 5.150%, 6/01/12 892,947
845,000 5.050%, 6/01/11 845,651
300,000 State Housing & Mortgage Finance
Agency RB, Multi-Family Housing,
Series A, FSA, AMT
5.050%, 11/01/18 303,255
5,500,000 West Deptford Township BAN,
Series C (5)
4.250%, 12/17/07 5,502,420
--------------
17,744,625
NEW HAMPSHIRE - 0.9%
2,245,000 Claremont GO (5)
6.000%, 8/15/17 2,301,956
--------------
NEW MEXICO - 0.1%
360,000 State, Mortgage Financial Authority
RB, Single-Family Housing,
Series A2, Class I, AMT, GNMA,
FNMA, FHLMC
3.900%, 1/01/19 359,795
--------------
NEW YORK - 3.0%
100,000 Freeport GO
4.500%, 8/01/08 100,685
500,000 Highland Hospital RB, Rochester (5)
5.150%, 8/01/08 500,135
600,000 New York City, Industrial Development
Agency RB, Polytechnic University
Project, Pre-Refunded @ 101 (9)
6.125%, 11/01/10 651,144
2,165,000 New York State Housing Finance
Agency RB, Multi-Family Housing,
Series B, AMT, SONYMA
4.750%, 8/15/37 2,171,452
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 85
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
445,000 Saratoga County, Industrial
Development Agency RB,
Saratoga Hospital Project, Series A
5.000%, 12/01/07 445,311
1,835,000 State Dormitory Authority RB,
Concord Nursing Home, GNMA
3.875%, 8/15/12 1,839,532
95,000 State Dormitory Authority RB,
State Supported Debt, Unrefunded,
Series B
5.700%, 2/15/09 97,049
525,000 State Urban Development RB,
Capital Appreciation, Series O,
FSA (6)
11.435%, 1/01/11 432,884
750,000 Tobacco Settlement Financing RB,
Series B-1C
5.250%, 6/01/13 756,060
335,000 Tobacco Settlement Financing RB,
Series C-1
5.250%, 6/01/12 335,496
--------------
7,329,748
NORTH CAROLINA - 0.1%
25,000 Pasquotank County, Public Schools
Project, COP, MBIA
5.000%, 6/01/15 25,205
30,000 State Medical Care Community
Hospital RB, Memorial Mission
Hospital Project, ETM
7.625%, 10/01/08 30,957
100,000 State Medical Care Community RB,
North Carolina Housing Foundation
Project, ACA
6.000%, 8/15/10 102,799
125,000 State Medical Care Community RB,
Saint Joseph Hospital Project,
AMBAC, ETM
5.000%, 10/01/08 125,142
--------------
284,103
NORTH DAKOTA - 0.1%
275,000 State Housing Finance Agency RB,
Home Mortgage Program,
Series A, AMT
5.200%, 7/01/19 277,412
--------------
OHIO - 0.5%
50,000 Cuyahoga County, Deaconess
Hospital Project RB, ETM
6.750%, 11/01/09 51,273
400,000 Euclid GO
5.300%, 12/01/07 400,564
130,000 Franklin County, First Mortgage RB,
OCLC Project, ETM
7.500%, 6/01/09 132,697
Principal
Amount $ Value $
- -------------- --------------
500,000 Montgomery County, Health
Facilities Authority, Franciscan at
Saint Leonard, Pre-Refunded
@100 (9)
5.500%, 1/01/10 515,825
--------------
1,100,359
OKLAHOMA - 1.4%
Pottawatomie County, Shawnee
Public Schools Project RB
835,000 5.000%, 9/01/08 844,060
930,000 5.000%, 9/01/09 951,194
1,500,000 Tulsa, Industrial Authority TA,
Series A (5)
7.020%, 1/01/12 1,531,065
175,000 Tulsa, Industrial Authority TA,
Series B (5)
6.970%, 7/01/11 178,348
--------------
3,504,667
OREGON - 1.0%
445,000 State Housing & Community
Services Department RB, Single-
Family Mortgage Program, Series F,
AMT, MBIA
5.650%, 7/01/28 449,895
1,320,000 State Housing & Community
Services Department RB, Single-Family
Mortgage Program, Series J, AMT,
FNMA
5.750%, 7/01/29 1,335,114
550,000 State Housing & Community Services
Department RB, Single-Family
Mortgage Program, Series R, AMT
4.200%, 7/01/27 550,313
--------------
2,335,322
PENNSYLVANIA - 12.1%
10,000 Berks County GO, Second Series, MBIA
3.100%, 11/15/08 9,956
1,775,000 Bucks County, Industrial Development
Authority RB, School Lane Charter
School, Series A (10)
4.600%, 3/15/17 1,737,885
1,000,000 Chester County, Health & Education
Facilities Authority RB, Chester
County Hospital, MBIA
5.625%, 7/01/08 1,006,310
6,300,000 Delaware Valley, Regional Financial
Authority RB, Series C (1)
4.389%, 6/01/27 6,072,948
130,000 Lakeland, School District GO, ETM
8.875%, 8/15/10 141,172
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 86
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
1,215,000 Lawrence County, Industrial
Development Authority RB,
Shenango Presbyterian, Series B,
Pre-Refunded @ 102 (9)
7.500%, 11/15/11 1,396,764
975,000 Lehigh County, General Purpose
Authority RB, St. Lukes Hospital
Bethlehem (1)
4.744%, 8/15/42 862,875
3,670,000 Lycoming County, Hospitals Authority
RB, Divine Providence Hospital,
Connie Lee
5.375%, 11/15/10 3,674,808
515,000 Monroe County, Hospitals Authority
RB, Pocono Medical Center
5.000%, 1/01/10 521,927
200,000 Philadelphia, Authority for Industrial
Development RB, Russell Byers
School, Series B (5)
6.625%, 5/01/09 201,422
40,000 Philadelphia, Hospitals Authority RB,
Thomas Jefferson University
Hospital, ETM
7.000%, 7/01/08 40,771
740,000 Pittsburgh, Urban Redevelopment
Authority TA, Center Triangle,
Series B (5) (11)
5.420%, 5/01/15 736,714
1,250,000 Sayre, Health Care Facilities Authority
RB, Guthrie Health Issue, Series B,
Pre-Refunded @107.5 (9)
7.125%, 12/01/11 1,498,275
1,120,000 State Higher Education Facilities
Authority RB, St. Francis
Independent Colleges-Universities
5.000%, 11/01/11 1,131,469
State Higher Educational Facilities
Authority RB, Indiana University,
Series A, XLCA (1)
4,550,000 4.154%, 7/01/39 4,309,032
4,940,000 4.104%, 7/01/27 4,823,416
1,300,000 State Turnpike Commission BAN,
Series B, AMBAC (5)
5.290%, 10/15/09 1,300,572
--------------
29,466,316
SOUTH DAKOTA - 0.0%
95,000 State Lease Revenue Trust COP,
Series B, FSA
6.500%, 9/01/08 97,275
--------------
TENNESSEE - 0.6%
1,135,000 Knox County, Health Educational
& Housing Facilities RB, University
Health Systems
4.125%, 4/01/11 1,129,075
Principal
Amount $ Value $
- -------------- --------------
225,000 State Housing Development
Agency RB, Homeownership
Program, Series 1D
4.700%, 7/01/15 228,762
--------------
1,357,837
TEXAS - 5.2%
380,000 Brownsville GO, Capital
Appreciation, AMBAC (6)
12.711%, 2/15/11 311,231
405,000 Galveston County, Single-Family
Housing Mortgage RB, Mortgage-
Backed Securities Project, Series A,
AMT, GNMA, FNMA
6.200%, 12/01/32 409,099
2,000,000 Harris County RB, Series B,
AMBAC (1)
4.368%, 8/15/35 1,895,000
2,665,000 Pasadena, Independent School
District GO, Building, Series B,
FSA (1)
3.450%, 2/01/35 2,665,000
2,885,000 Retama, Development Special
Facilities RB, Retama Racetrack,
ETM (5)
8.750%, 12/15/10 3,196,407
State Municipal Gas Acquisition &
Supply RB (1)
2,600,000 4.685%, 9/15/27 2,470,000
250,000 4.515%, 9/15/17 244,687
1,275,000 State Municipal Gas Acquisition &
Supply RB, Series B (1)
4.145%, 12/15/09 1,255,875
260,000 Valley Community Hospital RB, ETM
7.500%, 4/01/09 268,411
--------------
12,715,710
VIRGINIA - 7.8%
445,000 Louisa, Industrial Development
Authority RB, Pollution Control
5.250%, 12/01/08 447,750
2,245,000 Pocahontas Parkway Association,
Toll Road RB, Capital Appreciation,
1st Tier, Sub-Series C, ETM (6)
4.060%, 8/15/08 2,183,285
11,285,000 Pocahontas Parkway Association,
Toll Road RB, Capital Appreciation,
Series B, ACA, Pre-Refunded
@ 45.5 (6) (9)
4.010%, 8/15/08 4,993,500
13,915,000 Pocahontas Parkway Association,
Toll Road RB, Capital Appreciation,
Series B, ACA, Pre-Refunded
@ 48.201 (6) (9)
4.010%, 8/15/08 6,522,795
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 87
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED)
OCTOBER 31, 2007
Principal
Amount $ Value $
- -------------- --------------
585,000 Pocahontas Parkway Association,
Toll Road RB, Capital Appreciation,
Series B, ACA-CBI, Pre-Refunded
@ 40.387 (6) (9)
3.945%, 8/15/08 229,771
3,795,000 Pocahontas Parkway Association,
Toll Road RB, Capital Appreciation,
Series B, ACA-CBI, Pre-Refunded
@ 57.582 (6) (9)
4.010%, 8/15/08 2,125,162
1,740,000 Pocahontas Parkway Association,
Toll Road RB, Capital Appreciation,
Series B, Pre-Refunded
@ 28.382 (6) (9)
4.022%, 8/15/08 480,257
700,000 Pocahontas Parkway Association,
Toll Road RB, Capital Appreciation,
Series B, Pre-Refunded @ 82.1 (6) (9)
3.995%, 8/15/08 558,901
1,500,000 Poplar Hill, Community
Development Authority, COP,
Series A (5)
5.500%, 9/01/34 1,485,240
--------------
19,026,661
UTAH - 0.6%
Salt Lake County RB, Westminster
College Project
180,000 4.500%, 10/01/08 180,524
200,000 4.500%, 10/01/09 201,088
230,000 4.500%, 10/01/10 231,428
550,000 4.500%, 10/01/11 553,119
265,000 Utah County, Charter School RB,
Lincoln Academy, Series B (5)
6.900%, 6/15/09 266,537
--------------
1,432,696
WASHINGTON - 1.5%
3,400,000 King County, Housing Authority RB,
Series A, RADIAN
5.050%, 7/01/13 3,420,094
150,000 Northshore, Parks & Recreational
Services GO
5.000%, 12/01/08 150,174
--------------
3,570,268
WEST VIRGINIA - 0.0%
45,000 Cabell, Putnam, & Wayne Counties,
Single-Family Residential
Mortgage RB, ETM, FGIC
7.375%, 4/01/10 46,536
--------------
WISCONSIN - 4.3%
500,000 Antigo, Taxable-Bond Anticipation
Notes RB (5)
6.375%, 8/01/09 504,585
Principal
Amount $ Value $
- -------------- --------------
1,250,000 Cedarburg GO (5)
5.875%, 12/01/09 1,258,937
1,000,000 Fond Du Lac, Water Works RB, BAN
4.000%, 3/01/10 1,000,670
1,250,000 Kewaskum RB, BAN
4.250%, 5/01/10 1,256,313
2,075,000 Kewaskum, Water Works & Sewer
System RB, BAN
4.250%, 5/01/10 2,084,586
1,250,000 Kronenwetter, Anticipation Notes
4.750%, 3/01/11 1,258,913
900,000 Oshkosh, Industrial Development
Authority RB, Don Evans Project,
AMT, Mandatory Put, (LOC:
Marshall & Ilslay) (7)
5.500%, 12/01/21 904,995
1,500,000 State Health & Educational Facilities
RB, Aurora Health Care, MBIA
5.000%, 8/15/09 1,531,530
805,000 State Housing & Economic
Development Authority RB,
AMT, Series E
5.800%, 9/01/17 806,135
--------------
10,606,664
--------------
TOTAL MUNICIPAL BONDS
(Cost $236,287,711) 234,666,035
--------------
CORPORATE OBLIGATIONS - 1.4%
641,360 IIS/Syska Holdings Energy (10)
3.900%, 8/15/08 628,296
250,000 Kidspeace National Centers of
Georgia, USDA (1) (2) (3) (4)
6.300%, 12/01/28 262,947
2,382,708 Niagara Elmwood (2) (5)
6.120%, 12/15/11 2,406,702
--------------
TOTAL CORPORATE
OBLIGATIONS
(Cost $3,272,503) 3,297,945
--------------
Shares
- --------------
SHORT-TERM INVESTMENT - 2.1%
5,170,414 BlackRock Institutional Muni
Fund Portfolio, 3.33% (12) 5,170,414
--------------
TOTAL SHORT-TERM
INVESTMENT
(Cost $5,170,414) 5,170,414
--------------
TOTAL INVESTMENTS - 99.5%
(Cost $244,730,628) 243,134,394
--------------
OTHER ASSETS LESS
LIABILITIES - 0.5% 1,321,637
--------------
NET ASSETS - 100.0% $ 244,456,031
==============
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 88
- --------------------------------------------------------------------------------
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONCLUDED)
OCTOBER 31, 2007
(1) Variable Rate Security -- Rate disclosed is as of October 31, 2007.
(2) Private Placement Security.
(3) Security considered restricted. (See Note 2 in Notes to Financial
Statements.)
(4) Security considered illiquid. On October 31, 2007, the value of these
securities amounted to $4,658,967, representing 1.9% of the net assets of
the Fund.
(5) Security is taxable.
(6) Zero Coupon Security -- Rate disclosed is the effective yield at time of
purchase.
(7) Mandatory Put Security -- The mandatory put date is shown as the maturity
date on the Schedule of Investments.
(8) Step Bond -- Coupon rate increases in increments to maturity. Rate
disclosed is as of October 31, 2007.
(9) Pre-Refunded Security -- The maturity date shown is the pre-refunded date.
(10) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration normally to qualified institutions. On October 31, 2007, the
value of these securities amounted to $2,366,181, representing 1.0% of the
net assets of the Fund.
(11) Security purchased on a when-issued basis.
(12) Rate shown is the 7-day effective yield as of October 31, 2007.
AMT -- Income from security may be subject to alternative minimum tax.
BAN -- Bond Anticipation Note
CBI -- Community-Based Initiatives
COP -- Certificate of Participation
CRA -- Community Redevelopment Agency
ETM -- Escrowed to Maturity
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
GNMA -- Government National Mortgage Association
GO -- General Obligation
LLP -- Limited Liability Partnership
LOC -- Letter of Credit
NA -- National Association
RB -- Revenue Bond
SA -- Special Assessment
TA -- Tax Allocation
Guaranteed as to principal and interest by the organization identified below:
ACA -- American Capital Access
AMBAC -- American Municipal Bond Assurance Corporation
FGIC -- Federal Guaranty Insurance Company
FHA -- Federal Housing Administration
FSA -- Financial Security Assurance
MBIA -- Municipal Bond Investors Assurance
RADIAN -- RADIAN Guaranty
SONYMA -- SONYMA Guaranty
USDA -- USDA Guaranty
XLCA -- XL Capital Assurance
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 89
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
OCTOBER 31, 2007
NORTH INTERNATIONAL U.S. SMALL
AMERICAN DIVERSIFIED U.S. AND MID CAP
EQUITY VALUE OPPORTUNITIES OPPORTUNITIES
FUND FUND FUND FUND
------------- ------------- ------------- -------------
ASSETS
Investments in securities, at value -- Note 2 ......... $ 810,741,248 $ 14,164,948 $ 307,457,304 $ 11,610,002
Cash .................................................. -- -- -- --
Foreign Currency ...................................... -- 45,060 -- --
Receivable for Fund shares sold ....................... -- -- 154,985 --
Initial margin for futures contracts .................. -- -- -- --
Dividends and tax reclaims receivable ................. 834,958 35,352 160,802 4,173
Interest receivable ................................... 5,978 309 118,667 3,807
Receivable for securities sold ........................ 20,425,379 39,270 7,070,497 145,534
Appreciated swap contracts, at value -- Note 2 ........ -- -- -- --
Unrealized appreciation on spot contracts ............. -- 795 -- --
Unrealized appreciation on forward contracts .......... -- -- -- --
Prepaid expenses ...................................... 30,893 20,105 25,710 10,308
Due from Investment Advisor -- Note 3 ................. -- 24,162 -- 2,083
------------- ------------- ------------- -------------
TOTAL ASSETS ...................................... 832,038,456 14,330,001 314,987,965 11,775,907
LIABILITIES
Foreign taxes payable ................................. -- 868 -- --
Due to custodian ...................................... -- -- -- --
Variation margin payable .............................. -- -- -- --
Income distributions payable .......................... -- -- -- --
Depreciated swap contracts, at value -- Note 2 ........ -- -- -- --
Unrealized depreciation on spot contracts ............. -- 89 -- --
Unrealized depreciation on forward contracts .......... -- -- -- --
Payable for securities purchased ...................... 17,364,569 100,209 5,927,921 95,717
Payable for Fund shares redeemed ...................... 4,237,838 -- 421,242 --
Investment Advisory fees payable -- Note 3 ............ 172,868 -- 259,774 --
Sub-administration fees payable -- Note 3 ............. 8,989 1,223 27,242 1,020
Trustees' fees payable -- Note 5 ...................... 6,418 1,464 3,344 1,448
Distribution fees payable -- Note 3 ................... 39 346 1,248 286
Accrued expenses and other liabilities ................ 117,372 87,032 86,024 59,879
------------- ------------- ------------- -------------
TOTAL LIABILITIES ................................. 21,908,093 191,231 6,726,795 158,350
------------- ------------- ------------- -------------
NET ASSETS .......................................... $ 810,130,363 $ 14,138,770 $ 308,261,170 $ 11,617,557
============= ============= ============= =============
NET ASSETS
Capital paid-in ....................................... $ 593,687,540 $ 10,435,233 $ 230,564,224 $ 9,310,300
Undistributed (distributions in excess of) net
investment income ................................... 13,409,016 411,612 355,076 (15,555)
Accumulated net realized gain (loss) on
investments, futures, swap contracts and foreign
currency transactions ............................... 87,635,317 1,538,072 27,139,902 643,564
Accumulated foreign capital gains tax on appreciated
securities .......................................... -- (868) -- --
Net unrealized appreciation (depreciation) on
investments ......................................... 115,406,603 1,752,899 50,201,968 1,679,248
Net unrealized appreciation on futures ................ -- -- -- --
Net unrealized appreciation on swap contracts ......... -- -- -- --
Net unrealized appreciation (depreciation) on
foreign currency translations ....................... (8,113) 1,822 -- --
------------- ------------- ------------- -------------
NET ASSETS .......................................... $ 810,130,363 $ 14,138,770 $ 308,261,170 $ 11,617,557
============= ============= ============= =============
Investor Shares:
Net assets ............................................ $ 809,997,691 $ 12,479,178 $ 302,351,161 $ 10,197,124
Total shares outstanding at end of period ............. 59,910,988 914,253 11,902,771 811,798
Net asset value, offering and redemption price per
share (net assets / shares outstanding) ............. $ 13.52 $ 13.65 $ 25.40 $ 12.56
Advisor Shares:
Net assets ............................................ $ 132,672 $ 1,659,592 $ 5,910,009 $ 1,420,433
Total shares outstanding at end of period ............. 9,841 121,833 233,429 113,382
Net asset value, offering and redemption price per
share (net assets / shares outstanding) ............. $ 13.48 $ 13.62 $ 25.32 $ 12.53
Cost of securities ....................................... $ 695,334,645 $ 12,412,049 $ 257,255,336 $ 9,930,754
Cost of foreign currency ................................. $ -- $ 44,660 $ -- $ --
Proceeds received for swap contracts ..................... $ -- $ -- $ -- $ --
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 90
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
EMERGING
INTERNATIONAL MARKET ENHANCED STRATEGIC
ALPHA EQUITY INCOME BOND
FUND FUND FUND FUND
------------- ------------- ------------- -------------
ASSETS
Investments in securities, at value -- Note 2 ......... $ 56,634,017 $ 30,401,458 $ 114,184,230 $ 39,758,903
Cash .................................................. -- -- -- 22,024
Foreign Currency ...................................... 8,730 50,214 -- 691,093
Receivable for Fund shares sold ....................... 22,500 40,000 -- --
Initial margin for futures contracts .................. -- -- -- 169,408
Dividends and tax reclaims receivable ................. 91,360 27,513 -- --
Interest receivable ................................... 3,674 2,772 372,382 277,528
Receivable for securities sold ........................ 168,494 283,425 125,890 3,224,314
Appreciated swap contracts, at value -- Note 2 ........ -- -- -- 57,847
Unrealized appreciation on spot contracts ............. 49 -- -- 19,989
Unrealized appreciation on forward contracts .......... -- -- -- 4,566
Prepaid expenses ...................................... 14,520 10,221 13,576 17,920
Due from Investment Advisor -- Note 3 ................. -- -- -- --
------------- ------------- ------------- -------------
TOTAL ASSETS ..................................... 56,943,344 30,815,603 114,696,078 44,243,592
LIABILITIES
Foreign taxes payable ................................. -- 54,849 -- --
Due to custodian ...................................... -- -- -- --
Variation margin payable .............................. -- -- -- 35,687
Income distributions payable .......................... -- -- 150 --
Depreciated swap contracts, at value -- Note 2 ........ -- -- -- 40,650
Unrealized depreciation on spot contracts ............. -- 179 -- --
Unrealized depreciation on forward contracts .......... -- -- -- 76,864
Payable for securities purchased ...................... 27,999 297,321 1,006,868 9,598,864
Payable for Fund shares redeemed ...................... 1,000 -- -- --
Investment Advisory fees payable -- Note 3 ............ 39,302 7,572 17,656 59,949
Sub-administration fees payable -- Note 3 ............. 4,860 2,507 10,081 3,166
Trustees' fees payable -- Note 5 ...................... 1,736 1,568 2,096 1,590
Distribution fees payable -- Note 3 ................... 5,570 454 239 531
Accrued expenses and other liabilities ................ 71,403 82,792 75,404 104,581
------------- ------------- ------------- -------------
TOTAL LIABILITIES ................................. 151,870 447,242 1,112,494 9,921,882
------------- ------------- ------------- -------------
NET ASSETS .......................................... $ 56,791,474 $ 30,368,361 $ 113,583,584 $ 34,321,710
============= ============= ============= =============
NET ASSETS
Capital paid-in ....................................... $ 52,455,317 $ 18,169,953 $ 116,824,638 $ 34,369,213
Undistributed (distributions in excess of) net
investment income ................................... 529,992 48,572 (51,801) 143,896
Accumulated net realized gain (loss) on investments,
futures, swap contracts and foreign currency
transactions ...................................... (3,532,554) 3,241,710 (1,384,707) (307,027)
Accumulated foreign capital gains tax on appreciated
securities .......................................... -- (54,849) -- --
Net unrealized appreciation (depreciation) on
investments ......................................... 7,332,532 8,961,560 (1,804,546) 91,727
Net unrealized appreciation on futures ................ -- -- -- 26,757
Net unrealized appreciation on swap contracts ......... -- -- -- 28,669
Net unrealized appreciation (depreciation) on foreign
currency translations ............................... 6,187 1,415 -- (31,525)
------------- ------------- ------------- -------------
NET ASSETS .......................................... $ 56,791,474 $ 30,368,361 $ 113,583,584 $ 34,321,710
============= ============= ============= =============
Investor Shares:
Net assets ............................................ $ 28,483,191 $ 27,774,423 $ 112,429,389 $ 32,022,537
Total shares outstanding at end of period ............. 2,119,068 1,551,179 11,583,888 3,187,064
Net asset value, offering and redemption price per
share (net assets / shares outstanding) ............. $ 13.44 $ 17.91 $ 9.71 $ 10.05
Advisor Shares:
Net assets ............................................ $ 28,308,283 $ 2,593,938 $ 1,154,195 $ 2,299,173
Total shares outstanding at end of period ............. 2,112,090 145,220 118,880 228,836
Net asset value, offering and redemption price per
share (net assets / shares outstanding) ............. $ 13.40 $ 17.86 $ 9.71 $ 10.05
Cost of securities ....................................... $ 49,301,485 $ 21,439,898 $ 115,988,776 $ 39,667,176
Cost of foreign currency ................................. $ 8,406 $ 49,799 $ -- $ 652,822
Proceeds received for swap contracts ..................... $ -- $ -- $ -- $ (11,472)
SHORT-TERM
TOTAL RETURN MUNICIPAL MUNICIPAL
FIXED INCOME BOND BOND
FUND FUND FUND
------------ ------------- -------------
ASSETS
Investments in securities, at value -- Note 2 ......... $ 76,593,195 $ 666,707,708 $ 243,134,394
Cash .................................................. -- -- --
Foreign Currency ...................................... -- -- --
Receivable for Fund shares sold ....................... -- 6,041,763 1,305,982
Initial margin for futures contracts .................. 71,220 -- --
Dividends and tax reclaims receivable ................. -- -- --
Interest receivable ................................... 415,096 8,283,494 3,035,617
Receivable for securities sold ........................ 9,152,131 1,362,352 2,600,900
Appreciated swap contracts, at value -- Note 2 ........ -- -- --
Unrealized appreciation on spot contracts ............. -- -- --
Unrealized appreciation on forward contracts .......... -- -- --
Prepaid expenses ...................................... 10,808 33,164 21,071
Due from Investment Advisor -- Note 3 ................. -- -- --
------------ ------------- -------------
TOTAL ASSETS ...................................... 86,242,450 682,428,481 250,097,964
LIABILITIES
Foreign taxes payable ................................. -- -- --
Due to custodian ...................................... 37,463 -- --
Variation margin payable .............................. 52,031 -- --
Income distributions payable .......................... -- 2,303,352 818,374
Depreciated swap contracts, at value -- Note 2 ........ -- -- --
Unrealized depreciation on spot contracts ............. -- -- --
Unrealized depreciation on forward contracts .......... -- -- --
Payable for securities purchased ...................... 13,955,744 4,553,580 3,640,691
Payable for Fund shares redeemed ...................... -- 977,048 991,140
Investment Advisory fees payable -- Note 3 ............ 5,793 199,145 78,481
Sub-administration fees payable -- Note 3 ............. 6,390 59,345 21,952
Trustees' fees payable -- Note 5 ...................... 1,838 5,691 2,949
Distribution fees payable -- Note 3 ................... 190 4,678 2,318
Accrued expenses and other liabilities ................ 72,502 136,722 86,028
------------ ------------- -------------
TOTAL LIABILITIES ................................. 14,131,951 8,239,561 5,641,933
------------ ------------- -------------
NET ASSETS .......................................... $ 72,110,499 $ 674,188,920 $ 244,456,031
============ ============= =============
NET ASSETS
Capital paid-in ....................................... $ 71,958,951 $ 679,221,360 $ 246,367,322
Undistributed (distributions in excess of) net
investment income ................................... (30,401) 631,590 272,816
Accumulated net realized gain (loss) on investments,
futures, swap contracts and foreign currency
transactions ........................................ 11,954 (279,677) (587,873)
Accumulated foreign capital gains tax on appreciated
securities .......................................... -- -- --
Net unrealized appreciation (depreciation) on
investments ......................................... 121,801 (5,384,353) (1,596,234)
Net unrealized appreciation on futures ................ 48,194 -- --
Net unrealized appreciation on swap contracts ......... -- -- --
Net unrealized appreciation (depreciation) on foreign
currency translations ............................... -- -- --
------------ ------------- -------------
NET ASSETS .......................................... $ 72,110,499 $ 674,188,920 $ 244,456,031
============ ============= =============
Investor Shares:
Net assets ............................................ $ 71,258,977 $ 656,027,069 $ 233,531,575
Total shares outstanding at end of period ............. 7,279,201 65,973,865 23,650,316
Net asset value, offering and redemption price per
share (net assets / shares outstanding) ............. $ 9.79 $ 9.94 $ 9.87
Advisor Shares:
Net assets ............................................ $ 851,522 $ 18,161,851 $ 10,924,456
Total shares outstanding at end of period ............. 86,948 1,827,316 1,106,477
Net asset value, offering and redemption price per
share (net assets / shares outstanding) ............. $ 9.79 $ 9.94 $ 9.87
Cost of securities ....................................... $ 76,471,394 $ 672,092,061 $ 244,730,628
Cost of foreign currency ................................. $ -- $ -- $ --
Proceeds received for swap contracts ..................... $ -- $ -- $ --
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 91
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 31, 2007
NORTH INTERNATIONAL U.S. SMALL
AMERICAN DIVERSIFIED U.S. AND MID CAP
EQUITY VALUE OPPORTUNITIES OPPORTUNITIES
FUND FUND FUND FUND
------------- ------------- ------------- -------------
INVESTMENT INCOME
Dividend income ....................................... $ 20,820,429 $ 559,696 $ 2,194,796 $ 69,321
Interest income ....................................... 564,766 22,363 1,639,582 51,752
Foreign taxes withheld ................................ (255,774) (52,461) (6,473) (481)
------------- ------------- ------------- -------------
TOTAL INCOME ........................................ 21,129,421 529,598 3,827,905 120,592
EXPENSES
Investment Advisory fees -- Note 3 .................... 2,464,110 125,246 2,853,566 102,718
Sub-administration fees -- Note 3 ..................... 124,242 13,666 311,562 11,206
Trustees fees -- Note 5 ............................... 48,491 11,247 25,507 11,124
Distribution fees -- Note 3 ........................... 416 3,363 11,275 2,988
Legal fees ............................................ 137,216 45,801 52,306 22,298
Insurance ............................................. 114,358 13,075 33,036 12,717
Transfer agent fees ................................... 112,925 77,340 97,815 77,825
Custodian fees ........................................ 67,942 43,997 28,709 6,352
Printing expenses ..................................... 59,437 15,612 62,413 11,303
Registration fees ..................................... 30,805 10,662 47,706 18,983
Audit fees ............................................ 30,649 37,624 29,779 29,448
Pricing fees .......................................... 5,490 33,186 2,236 1,186
Amortization of deferred offering costs -- Note 2 ..... -- 36,508 -- 9,269
Other ................................................. 32,931 18,612 12,015 7,409
------------- ------------- ------------- -------------
TOTAL EXPENSES ...................................... 3,229,012 485,939 3,567,925 324,826
Expenses waived by Investment Advisor -- Note 3 ....... -- (125,246) -- (102,718)
Reimbursement from Investment Advisor -- Note 3 ....... -- (200,769) -- (75,314)
------------- ------------- ------------- -------------
NET EXPENSES ........................................ 3,229,012 159,924 3,567,925 146,794
------------- ------------- ------------- -------------
NET INVESTMENT INCOME (LOSS) ........................ 17,900,409 369,674 259,980 (26,202)
------------- ------------- ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS,
FUTURES, SWAP CONTRACTS, FOREIGN CAPITAL GAINS TAX
ON APPRECIATED SECURITIES AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on investments sold .......... 150,381,639+ 1,652,329 27,722,498 737,834
Net realized gain (loss) on futures ................... 754,724 -- -- --
Net realized gain on swap contracts ................... -- -- -- --
Net realized gain (loss) on foreign currency
transactions ........................................ (55,984) 4,973 (92) (33)
------------- ------------- ------------- -------------
Net realized gain (loss) on
investments, futures, swap contracts and
foreign currency transactions ................... 151,080,379 1,657,302 27,722,406 737,801
------------- ------------- ------------- -------------
Change in unrealized appreciation (depreciation) on
investments ......................................... (26,490,725) 1,310,510 23,437,416 1,373,594
Change in unrealized appreciation on futures .......... -- -- -- --
Change in unrealized appreciation on swap contracts ... -- -- -- --
Change in unrealized on foreign capital gains tax on
appreciated securities .............................. -- (292) -- --
Change in unrealized appreciation (depreciation) on
foreign currency translations ....................... (116) 1,771 37 1
------------- ------------- ------------- -------------
Net change in unrealized appreciation (depreciation)
on investments, futures, swap contracts, foreign
capital gains tax on appreciated securities and
foreign currency translations ................... (26,490,841) 1,311,989 23,437,453 1,373,595
------------- ------------- ------------- -------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ......................................... 124,589,538 2,969,291 51,159,859 2,111,396
------------- ------------- ------------- -------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ........................... $ 142,489,947 $ 3,338,965 $ 51,419,839 $ 2,085,194
============= ============= ============= =============
+ Includes realized gains from in-kind transactions (see Note 6 in Notes to
Financial Statements).
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 92
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
EMERGING
INTERNATIONAL MARKET ENHANCED STRATEGIC
ALPHA EQUITY INCOME BOND
FUND FUND FUND FUND
------------- ------------- ------------- -------------
INVESTMENT INCOME
Dividend income ....................................... $ 1,238,473 $ 415,916 $ -- $ --
Interest income ....................................... 51,188 20,789 6,519,981 1,759,398
Foreign taxes withheld ................................ (86,602) (29,748) -- (1,192)
------------- ------------- ------------- -------------
TOTAL INCOME ........................................ 1,203,059 406,957 6,519,981 1,758,206
EXPENSES
Investment Advisory fees -- Note 3 .................... 546,231 192,533 279,074 248,114
Sub-administration fees -- Note 3 ..................... 61,288 20,915 122,068 36,079
Trustees fees -- Note 5 ............................... 13,340 11,616 16,301 12,061
Distribution fees -- Note 3 ........................... 51,344 3,457 2,874 7,662
Legal fees ............................................ 27,277 23,439 33,255 59,147
Insurance ............................................. 19,008 13,122 24,062 13,917
Transfer agent fees ................................... 79,335 77,888 80,415 78,212
Custodian fees ........................................ 21,878 82,657 20,971 15,673
Printing expenses ..................................... 15,217 11,763 16,840 26,938
Registration fees ..................................... 25,837 17,673 25,099 27,443
Audit fees ............................................ 33,173 33,269 31,860 36,415
Pricing fees .......................................... 6,056 9,048 21,452 25,399
Amortization of deferred offering costs -- Note 2 ..... -- 10,962 -- 3,750
Other ................................................. 9,095 11,717 9,301 7,842
------------- ------------- ------------- -------------
TOTAL EXPENSES ...................................... 909,079 520,059 683,572 598,652
Expenses waived by Investment Advisor -- Note 3 ....... (157,424) (179,672) (234,046) (210,550)
Reimbursement from Investment Advisor -- Note 3 ....... -- -- -- --
------------- ------------- ------------- -------------
NET EXPENSES ........................................ 751,655 340,387 449,526 388,102
------------- ------------- ------------- -------------
NET INVESTMENT INCOME (LOSS) ........................ 451,404 66,570 6,070,455 1,370,104
------------- ------------- ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS,
FUTURES, SWAP CONTRACTS, FOREIGN CAPITAL GAINS TAX
ON APPRECIATED SECURITIES AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on investments sold .......... 8,185,330 3,457,446 (1,016,241) (56,909)
Net realized gain (loss) on futures ................... -- -- -- (136,279)
Net realized gain on swap contracts ................... -- -- -- 119,605
Net realized gain (loss) on foreign currency
transactions ........................................ (3,101) (6,811) -- (35,900)
------------- ------------- ------------- -------------
Net realized gain (loss) on
investments, futures, swap contracts and
foreign currency transactions ................... 8,182,229 3,450,635 (1,016,241) (109,483)
------------- ------------- ------------- -------------
Change in unrealized appreciation (depreciation) on
investments ......................................... 4,452,466 7,971,705 (1,421,910) (200,228)
Change in unrealized appreciation on futures .......... -- -- -- 117,967
Change in unrealized appreciation on swap contracts ... -- -- -- 22,278
Change in unrealized on foreign capital gains tax on
appreciated securities .............................. -- (48,764) -- --
Change in unrealized appreciation (depreciation) on
foreign currency translations ....................... 2,869 1,403 -- 22,638
------------- ------------- ------------- -------------
Net change in unrealized
appreciation (depreciation) on investments,
futures, swap contracts, foreign capital
gains tax on appreciated securities and
foreign currency translations ................... 4,455,335 7,924,344 (1,421,910) (37,345)
------------- ------------- ------------- -------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ......................................... 12,637,564 11,374,979 (2,438,151) (146,828)
------------- ------------- ------------- -------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ........................... $ 13,088,968 $ 11,441,549 $ 3,632,304 $ 1,223,276
============= ============= ============= =============
SHORT-TERM
TOTAL RETURN MUNICIPAL MUNICIPAL
FIXED INCOME BOND BOND
FUND FUND FUND
------------ ------------- -------------
INVESTMENT INCOME
Dividend income ....................................... $ -- $ 712,775 $ 401,961
Interest income ....................................... 2,132,283 19,596,153 9,065,534
Foreign taxes withheld ................................ -- -- --
------------ ------------- -------------
TOTAL INCOME ........................................ 2,132,283 20,308,928 9,467,495
EXPENSES
Investment Advisory fees -- Note 3 .................... 99,292 1,749,900 847,656
Sub-administration fees -- Note 3 ..................... 42,821 473,058 231,305
Trustees fees -- Note 5 ............................... 12,397 32,741 21,595
Distribution fees -- Note 3 ........................... 2,046 41,423 17,900
Legal fees ............................................ 25,435 67,479 44,215
Insurance ............................................. 17,519 33,750 29,721
Transfer agent fees ................................... 78,244 93,256 84,150
Custodian fees ........................................ 14,364 36,803 19,393
Printing expenses ..................................... 13,391 77,510 25,657
Registration fees ..................................... 22,908 48,495 30,829
Audit fees ............................................ 31,752 30,849 30,874
Pricing fees .......................................... 18,638 87,702 39,645
Amortization of deferred offering costs -- Note 2 ..... -- -- --
Other ................................................. 7,770 12,047 10,223
------------ ------------- -------------
TOTAL EXPENSES ...................................... 386,577 2,785,013 1,433,163
Expenses waived by Investment Advisor -- Note 3 ....... (99,292) (337,498) (249,735)
Reimbursement from Investment Advisor -- Note 3 ....... (126,370) -- --
------------ ------------- -------------
NET EXPENSES ........................................ 160,915 2,447,515 1,183,428
------------ ------------- -------------
NET INVESTMENT INCOME (LOSS) ........................ 1,971,368 17,861,413 8,284,067
------------ ------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS,
FUTURES, SWAP CONTRACTS, FOREIGN CAPITAL GAINS TAX
ON APPRECIATED SECURITIES AND FOREIGN CURRENCY
TRANSACTIONS
Net realized gain (loss) on investments sold .......... 163,495 (24,123) (111,799)
Net realized gain (loss) on futures ................... 46,823 -- --
Net realized gain on swap contracts ................... -- -- --
Net realized gain (loss) on foreign currency
transactions ........................................ (678) -- --
------------ ------------- -------------
Net realized gain (loss) on
investments, futures, swap contracts and
foreign currency transactions ................... 209,640 (24,123) (111,799)
------------ ------------- -------------
Change in unrealized appreciation (depreciation) on
investments ......................................... 67,714 (7,535,301) (1,921,515)
Change in unrealized appreciation on futures .......... 49,741 -- --
Change in unrealized appreciation on swap contracts ... -- -- --
Change in unrealized on foreign capital gains tax on
appreciated securities .............................. -- -- --
Change in unrealized appreciation (depreciation) on
foreign currency translations ....................... -- -- --
------------ ------------- -------------
Net change in unrealized appreciation
(depreciation) on investments, futures, swap
contracts, foreign capital gains tax on
appreciated securities and foreign currency
translations .................................... 117,455 (7,535,301) (1,921,515)
------------ ------------- -------------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ......................................... 327,095 (7,559,424) (2,033,314)
------------ ------------- -------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS ........................... $ 2,298,463 $ 10,301,989 $ 6,250,753
============ ============= =============
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 93
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS OR PERIOD ENDED OCTOBER 31,
NORTH AMERICAN
EQUITY FUND
----------------------------------
2007 2006
--------------- --------------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income (loss) ................................................................ $ 17,900,409 $ 22,897,980
Net realized gain (loss) on investments sold, futures and foreign currency transactions ..... 151,080,379+ 82,523,753+
Change in unrealized appreciation (depreciation) on investments, foreign capital gains
tax on appreciated securities and foreign currency translations .......................... (26,490,841) 83,486,780
--------------- --------------
Net increase in net assets resulting from operations ..................................... 142,489,947 188,908,513
--------------- --------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Investor Shares .......................................................................... (23,398,287) (12,335,404)
Advisor Shares ........................................................................... (2,080) --
Net realized gains:
Investor Shares .......................................................................... (53,303,193) (20,970,187)
Advisor Shares ........................................................................... (5,293) --
--------------- --------------
Total dividends and distributions ........................................................ (76,708,853) (33,305,591)
--------------- --------------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ............................................................................. 132,568,048 107,993,074
Proceeds from shares sold in-kind ........................................................... -- 188,271,143
Reinvestment of distributions ............................................................... 18,112,110 21,749,065
Redemption of shares ........................................................................ (372,052,319) (317,239,270)
Redemption of shares in-kind ................................................................ (296,385,601) (197,662,858)
Redemption fees - Note 4 .................................................................... -- --
--------------- --------------
Total increase (decrease) from Investor Share transactions ............................... (517,757,762) (196,888,846)
--------------- --------------
ADVISOR SHARES(c):
Sales of shares ............................................................................. 10,000 100,000
Reinvestment of distributions ............................................................... 7,373 --
Redemption of shares ........................................................................ -- --
Redemption fees - Note 4 .................................................................... -- --
--------------- --------------
Total increase from Advisor Share transactions ........................................... 17,373 100,000
--------------- --------------
Net increase (decrease) in net assets from share transactions ............................ (517,740,389) (196,788,846)
--------------- --------------
Total increase (decrease) in net assets .................................................. (451,959,295) (41,185,924)
NET ASSETS
Beginning of Period ......................................................................... 1,262,089,658 1,303,275,582
--------------- --------------
End of Period ............................................................................... $ 810,130,363 $1,262,089,658
=============== ==============
Undistributed (accumulated net investment loss/distributions in excess of) net
investment income ........................................................................ $ 13,409,016 $ 18,810,339
=============== ==============
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ............................................................................. 10,660,078 9,242,003
Shares sold in-kind ......................................................................... -- 16,145,433
Reinvestment of distributions ............................................................... 1,506,831 1,907,813
Redemption of shares ........................................................................ (29,037,394) (27,323,408)
Redemption of shares in-kind ................................................................ (23,138,873) (16,916,303)
--------------- --------------
Net increase (decrease) in Investor Shares ............................................... (40,009,358) (16,944,462)
=============== ==============
ADVISOR SHARES(c):
Sales of shares ............................................................................. 782 8,446
Reinvestment of distributions ............................................................... 613 --
Reinvestment of shares ...................................................................... -- --
--------------- --------------
Net increase in Advisor Shares ........................................................... 1,395 8,446
=============== ==============
(a) Fund commenced investment activities on August 30, 2006.
(b) Fund commenced investment activities on March 31, 2006.
(c) The North American Equity Fund's Advisor Shares commenced operations on
March 31, 2006 and the U.S. Opportunities Fund's Advisor Shares commenced
operations on May 15, 2006.
+ Includes realized gains from in-kind transactions (see Note 6 in Notes to
Financial Statements).
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 94
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INTERNATIONAL DIVERSIFIED U.S. OPPORTUNITIES
VALUE FUND FUND
--------------------------- -----------------------------
2007 2006(a) 2007 2006
------------ ------------ ------------- -------------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income (loss) ........................................ $ 369,674 $ 39,060 $ 259,980 $ (195,360)
Net realized gain (loss) on investments sold, futures and foreign
currency transactions ............................................ 1,657,302 56,178 27,722,406 20,946,038
Change in unrealized appreciation (depreciation) on investments,
foreign capital gains tax on appreciated securities and foreign
currency translations ............................................ 1,311,989 441,864 23,437,453 12,710,043
------------ ------------ ------------- -------------
Net increase in net assets resulting from operations ............. 3,338,965 537,102 51,419,839 33,460,721
------------ ------------ ------------- -------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Investor Shares .................................................. (101,970) -- -- --
Advisor Shares ................................................... (10,713) -- -- --
Net realized gains:
Investor Shares .................................................. (53,820) -- (20,939,518) (5,427,542)
Advisor Shares ................................................... (6,027) -- (103,868) --
------------ ------------ ------------- -------------
Total dividends and distributions ................................ (172,530) -- (21,043,386) (5,427,542)
------------ ------------ ------------- -------------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ..................................................... 336,678 9,000,000 67,551,529 100,672,739
Proceeds from shares sold in-kind ................................... -- -- -- --
Reinvestment of distributions ....................................... 155,790 -- 20,495,365 5,298,332
Redemption of shares ................................................ (334,837) -- (46,481,850) (43,455,762)
Redemption of shares in-kind ........................................ -- -- -- --
Redemption fees - Note 4 ............................................ -- -- 8,024 21,450
------------ ------------ ------------- -------------
Total increase (decrease) from Investor Share transactions ....... 157,631 9,000,000 41,573,068 62,536,759
------------ ------------ ------------- -------------
ADVISOR SHARES(c):
Sales of shares ..................................................... 441,159 1,000,000 6,029,859 639,741
Reinvestment of distributions ....................................... 16,740 -- 60,689 --
Redemption of shares ................................................ (180,613) -- (1,457,593) --
Redemption fees - Note 4 ............................................ 316 -- 2,390 --
------------ ------------ ------------- -------------
Total increase from Advisor Share transactions ................... 277,602 1,000,000 4,635,345 639,741
------------ ------------ ------------- -------------
Net increase (decrease) in net assets from share transactions .... 435,233 10,000,000 46,208,413 63,176,500
------------ ------------ ------------- -------------
Total increase (decrease) in net assets .......................... 3,601,668 10,537,102 76,584,866 91,209,679
NET ASSETS
Beginning of Period ................................................. 10,537,102 -- 231,676,304 140,466,625
------------ ------------ ------------- -------------
End of Period ....................................................... $ 14,138,770 $ 10,537,102 $ 308,261,170 $ 231,676,304
============ ============ ============= =============
Undistributed (accumulated net investment loss/distributions in
excess of) net investment income ................................. $ 411,612 $ 35,474 $ 355,076 $ --
============ ============ ============= =============
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ..................................................... 26,303 900,000 2,945,901 4,637,415
Shares sold in-kind ................................................. -- -- -- --
Reinvestment of distributions ....................................... 14,253 -- 928,653 263,993
Redemption of shares ................................................ (26,303) -- (1,987,960) (2,030,621)
Redemption of shares in-kind ........................................ -- -- -- --
------------ ------------ ------------- -------------
Net increase (decrease) in Investor Shares ....................... 14,253 900,000 1,886,594 2,870,787
============ ============ ============= =============
ADVISOR SHARES(c):
Sales of shares ..................................................... 34,528 100,000 263,597 28,966
Reinvestment of distributions ....................................... 1,531 -- 2,754 --
Reinvestment of shares .............................................. (14,226) -- (61,888) --
------------ ------------ ------------- -------------
Net increase in Advisor Shares ................................... 21,833 100,000 204,463 28,966
============ ============ ============= =============
U.S. SMALL AND MID CAP
OPPORTUNITIES FUND
--------------------------
2007 2006(b)
------------ -----------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income (loss) ........................................ $ (26,202) $ (2,731)
Net realized gain (loss) on investments sold, futures and foreign
currency transactions ............................................ 737,801 (76,923)
Change in unrealized appreciation (depreciation) on investments,
foreign capital gains tax on appreciated securities and foreign
currency translations ............................................ 1,373,595 305,653
------------ -----------
Net increase in net assets resulting from operations ............. 2,085,194 225,999
------------ -----------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Investor Shares .................................................. (3,936) --
Advisor Shares ................................................... -- --
Net realized gains:
Investor Shares .................................................. -- --
Advisor Shares ................................................... -- --
------------ -----------
Total dividends and distributions ................................ (3,936) --
------------ -----------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ..................................................... 2,090,576 6,738,014
Proceeds from shares sold in-kind ................................... -- --
Reinvestment of distributions ....................................... 3,936 --
Redemption of shares ................................................ (700,051) --
Redemption of shares in-kind ........................................ -- --
Redemption fees - Note 4 ............................................ 1 --
------------ -----------
Total increase (decrease) from Investor Share transactions ....... 1,394,462 6,738,014
------------ -----------
ADVISOR SHARES(c):
Sales of shares ..................................................... 897,166 500,000
Reinvestment of distributions ....................................... -- --
Redemption of shares ................................................ (219,536) --
Redemption fees - Note 4 ............................................ 194 --
------------ -----------
Total increase from Advisor Share transactions ................... 677,824 500,000
------------ -----------
Net increase (decrease) in net assets from share transactions .... 2,072,286 7,238,014
------------ -----------
Total increase (decrease) in net assets .......................... 4,153,544 7,464,013
NET ASSETS
Beginning of Period ................................................. 7,464,013 --
------------ -----------
End of Period ....................................................... $ 11,617,557 $ 7,464,013
============ ===========
Undistributed (accumulated net investment loss/distributions in
excess of) net investment income ................................. $ (15,555) $ (3,554)
============ ===========
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ..................................................... 195,225 678,547
Shares sold in-kind ................................................. -- --
Reinvestment of distributions ....................................... 364 --
Redemption of shares ................................................ (62,338) --
Redemption of shares in-kind ........................................ -- --
------------ -----------
Net increase (decrease) in Investor Shares ....................... 133,251 678,547
============ ===========
ADVISOR SHARES(c):
Sales of shares ..................................................... 81,615 50,000
Reinvestment of distributions ....................................... -- --
Reinvestment of shares .............................................. (18,233) --
------------ -----------
Net increase in Advisor Shares ................................... 63,382 50,000
============ ===========
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 95
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS OR PERIOD ENDED OCTOBER 31,
INTERNATIONAL
ALPHA FUND
----------------------------
2007 2006
------------- ------------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income ............................................... $ 451,404 $ 259,275
Net realized gain (loss) on investments sold, futures, swap
contracts and foreign currency transactions ...................... 8,182,229 1,096,732
Change in unrealized appreciation (depreciation) on investments,
futures, foreign capital gains tax on appreciated securities and
foreign currency translations .................................... 4,455,335 2,330,580
------------- ------------
Net increase in net assets resulting from operations ............. 13,088,968 3,686,587
------------- ------------
DIVIDENDS TO SHAREHOLDERS:
Net investment income:
Investor Shares .................................................. (283,664) (128,898)
Advisor Shares ................................................... (178,023) --
------------- ------------
Total dividends .................................................. (461,687) (128,898)
------------- ------------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ..................................................... 11,133,510 14,728,546
Reinvestment of distributions ....................................... 282,490 125,253
Redemption of shares ................................................ (13,524,072) (1,070,040)
Redemption fees - Note 4 ............................................ 65 --
------------- ------------
Total increase (decrease) from Investor Share transactions ....... (2,108,007) 13,783,759
------------- ------------
ADVISOR SHARES(c):
Sales of shares ..................................................... 17,526,815 20,725,376
Reinvestment of distributions ....................................... 175,168 --
Redemption of shares ................................................ (15,872,841) (170,017)
Redemption fees - Note 4 ............................................ 486 993
------------- ------------
Total increase from Advisor Share transactions ................... 1,829,628 20,556,352
------------- ------------
Net increase (decrease) in net assets from share transactions .... (278,379) 34,340,111
------------- ------------
Total increase in net assets ..................................... 12,348,902 37,897,800
NET ASSETS
Beginning of Period ................................................. 44,442,572 6,544,772
------------- ------------
End of Period ....................................................... $ 56,791,474 $ 44,442,572
============= ============
Undistributed (distributions in excess of) net investment income .... $ 529,992 $ 212,556
============= ============
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ..................................................... 1,029,716 1,469,451
Reinvestment of distributions ....................................... 25,941 14,397
Redemption of shares ................................................ (1,093,754) (110,493)
------------- ------------
Net increase (decrease) in Investor Shares ....................... (38,097) 1,373,355
============= ============
ADVISOR SHARES(d):
Sales of shares ..................................................... 1,446,287 2,036,164
Reinvestment of distributions ....................................... 16,085 --
Redemption of shares ................................................ (1,370,058) (16,388)
------------- ------------
Net increase in Advisor Shares ................................... 92,314 2,019,776
============= ============
(a) Fund commenced investment activities on March 31, 2006.
(b) Fund commenced investment activities on June 30, 2006.
(c) The International Alpha Fund's Advisor Shares commenced operations on May
15, 2006.
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 96
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
EMERGING MARKET ENHANCED
EQUITY FUND INCOME FUND
--------------------------- -----------------------------
2007 2006(a) 2007 2006
------------ ------------ ------------- -------------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income ............................................... $ 66,570 $ 55,229 $ 6,070,455 $ 5,046,911
Net realized gain (loss) on investments sold, futures, swap
contracts and foreign currency transactions ...................... 3,450,635 (218,985) (1,016,241) (203,537)
Change in unrealized appreciation (depreciation) on investments,
futures, foreign capital gains tax on appreciated securities and
foreign currency translations .................................... 7,924,344 983,782 (1,421,910) 70,115
------------ ------------ ------------- -------------
Net increase in net assets resulting from operations ............. 11,441,549 820,026 3,632,304 4,913,489
------------ ------------ ------------- -------------
DIVIDENDS TO SHAREHOLDERS:
Net investment income:
Investor Shares .................................................. (59,930) -- (6,036,500) (5,220,764)
Advisor Shares ................................................... (3,237) -- (59,952) (49,587)
------------ ------------ ------------- -------------
Total dividends .................................................. (63,167) -- (6,096,452) (5,270,351)
------------ ------------ ------------- -------------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ..................................................... 4,555,976 12,000,008 642,975 2,541,497
Reinvestment of distributions ....................................... 59,930 -- 6,035,689 5,220,492
Redemption of shares ................................................ (150,000) -- (245,633) (79,750)
Redemption fees - Note 4 ............................................ -- -- -- --
------------ ------------ ------------- -------------
Total increase (decrease) from Investor Share transactions ....... 4,465,906 12,000,008 6,433,031 7,682,239
------------ ------------ ------------- -------------
ADVISOR SHARES(c):
Sales of shares ..................................................... 783,982 1,000,000 100,892 36,515
Reinvestment of distributions ....................................... 3,237 -- 59,951 49,587
Redemption of shares ................................................ (83,180) -- (85,809) (7,227)
Redemption fees - Note 4 ............................................ -- -- -- --
------------ ------------ ------------- -------------
Total increase from Advisor Share transactions ................... 704,039 1,000,000 75,034 78,875
------------ ------------ ------------- -------------
Net increase (decrease) in net assets from share transactions .... 5,169,945 13,000,008 6,508,065 7,761,114
------------ ------------ ------------- -------------
Total increase in net assets ..................................... 16,548,327 13,820,034 4,043,917 7,404,252
NET ASSETS
Beginning of Period ................................................. 13,820,034 -- 109,539,667 102,135,415
------------ ------------ ------------- -------------
End of Period ....................................................... $ 30,368,361 $ 13,820,034 $ 113,583,584 $ 109,539,667
============ ============ ============= =============
Undistributed (distributions in excess of) net investment income .... $ 48,572 $ 51,980 $ (51,801) $ (25,804)
============ ============ ============= =============
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ..................................................... 348,015 1,210,713 65,323 189,266
Reinvestment of distributions ....................................... 5,239 -- 614,008 592,037
Redemption of shares ................................................ (12,788) -- (25,040) (8,020)
------------ ------------ ------------- -------------
Net increase (decrease) in Investor Shares ....................... 340,466 1,210,713 654,291 773,283
============ ============ ============= =============
ADVISOR SHARES(d):
Sales of shares ..................................................... 50,217 100,000 10,191 3,045
Reinvestment of distributions ....................................... 283 -- 6,097 5,626
Redemption of shares ................................................ (5,280) -- (8,692) (727)
------------ ------------ ------------- -------------
Net increase in Advisor Shares ................................... 45,220 100,000 7,596 7,944
============ ============ ============= =============
STRATEGIC
BOND FUND
---------------------------
2007 2006(b)
------------ ------------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income ............................................... $ 1,370,104 $ 239,601
Net realized gain (loss) on investments sold, futures, swap
contracts and foreign currency transactions ...................... (109,483) (144,464)
Change in unrealized appreciation (depreciation) on investments,
futures, foreign capital gains tax on appreciated securities and
foreign currency translations .................................... (37,345) 152,973
------------ ------------
Net increase in net assets resulting from operations ............. 1,223,276 248,110
------------ ------------
DIVIDENDS TO SHAREHOLDERS:
Net investment income:
Investor Shares .................................................. (1,252,858) (146,680)
Advisor Shares ................................................... (112,241) (7,110)
------------ ------------
Total dividends .................................................. (1,365,099) (153,790)
------------ ------------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ..................................................... 14,848,074 19,000,000
Reinvestment of distributions ....................................... 846,358 146,680
Redemption of shares ................................................ (2,781,714) --
Redemption fees - Note 4 ............................................ -- --
------------ ------------
Total increase (decrease) from Investor Share transactions ....... 12,912,718 19,146,680
------------ ------------
ADVISOR SHARES(c):
Sales of shares ..................................................... 3,128,166 1,000,000
Reinvestment of distributions ....................................... 112,241 7,110
Redemption of shares ................................................ (1,937,828) --
Redemption fees - Note 4 ............................................ 126 --
------------ ------------
Total increase from Advisor Share transactions ................... 1,302,705 1,007,110
------------ ------------
Net increase (decrease) in net assets from share transactions .... 14,215,423 20,153,790
------------ ------------
Total increase in net assets ..................................... 14,073,600 20,248,110
NET ASSETS
Beginning of Period ................................................. 20,248,110 --
------------ ------------
End of Period ....................................................... $ 34,321,710 $ 20,248,110
============ ============
Undistributed (distributions in excess of) net investment income .... $ 143,896 $ 53,492
============ ============
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ..................................................... 1,464,142 1,900,000
Reinvestment of distributions ....................................... 84,253 14,727
Redemption of shares ................................................ (276,058) --
------------ ------------
Net increase (decrease) in Investor Shares ....................... 1,272,337 1,914,727
============ ============
ADVISOR SHARES(d):
Sales of shares ..................................................... 308,834 100,000
Reinvestment of distributions ....................................... 11,166 714
Redemption of shares ................................................ (191,878) --
------------ ------------
Net increase in Advisor Shares ................................... 128,122 100,714
============ ============
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 97
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED OCTOBER 31,
TOTAL RETURN FIXED
INCOME FUND
---------------------------
2007 2006
------------ ------------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income ................................................ $ 1,971,368 $ 967,415
Net realized gain (loss) on investments sold, futures and foreign
currency transactions. ............................................ 209,640 (168,940)
Change in unrealized appreciation (depreciation) on investments and
futures. .......................................................... 117,455 226,600
------------ ------------
Net increase in net assets resulting from operations .............. 2,298,463 1,025,075
------------ ------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Investor Shares ................................................... (1,948,060) (952,739)
Advisor Shares .................................................... (38,536) (47,476)
Net realized gains:
Investor Shares ................................................... -- (30,182)
Advisor Shares .................................................... -- (1,713)
------------ ------------
Total dividends and distributions ................................. (1,986,596) (1,032,110)
------------ ------------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ...................................................... 12,479,152 3,969,060
Proceeds from shares sold in-kind .................................... 46,437,681 8,819,298
Reinvestment of distributions ........................................ 1,938,673 982,921
Redemption of shares ................................................. (11,710,334) (1,109,764)
------------ ------------
Total increase from Investor Share transactions . ................. 49,145,172 12,661,515
------------ ------------
ADVISOR SHARES:
Sales of shares ...................................................... 682,413 21,000
Reinvestment of distributions ........................................ 38,536 49,189
Redemption of shares ................................................. (922,051) (20,894)
------------ ------------
Total increase (decrease) from Advisor Share transactions. ........ (201,102) 49,295
------------ ------------
Net increase in net assets from share transactions. ............... 48,944,070 12,710,810
------------ ------------
Total increase in net assets ...................................... 49,255,937 12,703,775
NET ASSETS
Beginning of Year .................................................... 22,854,562 10,150,787
------------ ------------
End of Year .......................................................... $ 72,110,499 $ 22,854,562
============ ============
Undistributed (distributions in excess of) net investment income. .... $ (30,401) $ (30,703)
============ ============
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ...................................................... 1,279,192 409,708
Shares sold in-kind .................................................. 4,787,713 897,182
Reinvestment of distributions. ....................................... 198,870 100,810
Redemption of shares. ................................................ (1,207,763) (114,019)
------------ ------------
Net increase in Investor Shares ................................... 5,058,012 1,293,681
============ ============
ADVISOR SHARES:
Sales of shares ...................................................... 70,155 2,115
Reinvestment of distributions ........................................ 3,931 5,036
Redemption of shares. ................................................ (95,000) (2,132)
------------ ------------
Net increase (decrease) in Advisor Shares ......................... (20,914) 5,019
============ ============
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 98
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
MUNICIPAL SHORT-TERM MUNICIPAL
BOND FUND BOND FUND
---------------------------- ---------------------------
2007 2006 2007 2006
------------ ------------- ------------ ------------
INCREASE IN NET ASSETS
FROM OPERATIONS:
Net investment income ................................................ $ 17,861,413 $ 6,995,547 $ 8,284,067 $ 5,690,766
Net realized gain (loss) on investments sold, futures and foreign
currency transactions. ............................................ (24,123) 185,006 (111,799) (143,998)
Change in unrealized appreciation (depreciation) on investments and
futures. .......................................................... (7,535,301) 2,852,828 (1,921,515) 925,630
------------ ------------- ------------ ------------
Net increase in net assets resulting from operations .............. 10,301,989 10,033,381 6,250,753 6,472,398
------------ ------------- ------------ ------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Investor Shares ................................................... (16,860,382) (6,335,605) (7,844,919) (5,513,943)
Advisor Shares .................................................... (623,428) (459,672) (256,771) (119,076)
Net realized gains:
Investor Shares ................................................... -- -- -- --
Advisor Shares .................................................... -- -- -- --
------------ ------------- ------------ ------------
Total dividends and distributions ................................. (17,483,810) (6,795,277) (8,101,690) (5,633,019)
------------ ------------- ------------ ------------
SHARE TRANSACTIONS:
INVESTOR SHARES:
Sales of shares ...................................................... 477,445,946 165,291,635 98,233,317 104,290,661
Proceeds from shares sold in-kind .................................... -- -- -- --
Reinvestment of distributions ........................................ 16,096,849 6,028,471 6,126,048 4,722,331
Redemption of shares ................................................. (75,530,675) (25,578,689) (56,312,635) (53,629,074)
------------ ------------- ------------ ------------
Total increase from Investor Share transactions . ................. 418,012,120 145,741,417 48,046,730 55,383,918
------------ ------------- ------------ ------------
ADVISOR SHARES:
Sales of shares ...................................................... 8,651,293 8,232,470 9,091,232 1,610,814
Reinvestment of distributions ........................................ 613,823 438,872 223,571 93,382
Redemption of shares ................................................. (5,622,547) (2,424,197) (2,057,135) (1,098,912)
------------ ------------- ------------ ------------
Total increase (decrease) from Advisor Share transactions. ........ 3,642,569 6,247,145 7,257,668 605,284
------------ ------------- ------------ ------------
Net increase in net assets from share transactions. ............... 421,654,689 151,988,562 55,304,398 55,989,202
------------ ------------- ------------ ------------
Total increase in net assets ...................................... 414,472,868 155,226,666 53,453,461 56,828,581
NET ASSETS
Beginning of Year .................................................... 259,716,052 104,489,386 191,002,570 134,173,989
------------ ------------- ------------ ------------
End of Year .......................................................... $674,188,920 $ 259,716,052 $244,456,031 $191,002,570
============ ============= ============ ============
Undistributed (distributions in excess of) net investment income. .... $ 631,590 $ 253,987 $ 272,816 $ 90,439
============ ============= ============ ============
CHANGES IN FUND SHARES
INVESTOR SHARES:
Sales of shares ...................................................... 47,697,954 16,564,601 9,909,536 10,518,310
Shares sold in-kind .................................................. -- -- -- --
Reinvestment of distributions. ....................................... 1,609,812 602,199 617,541 475,975
Redemption of shares. ................................................ (7,577,096) (2,560,647) (5,673,919) (5,408,658)
------------ ------------- ------------ ------------
Net increase in Investor Shares ................................... 41,730,670 14,606,153 4,853,158 5,585,627
============ ============= ============ ============
ADVISOR SHARES:
Sales of shares ...................................................... 863,739 823,851 916,457 162,507
Reinvestment of distributions ........................................ 61,293 43,868 22,552 9,414
Redemption of shares. ................................................ (562,763) (242,641) (207,470) (110,832)
------------ ------------- ------------ ------------
Net increase (decrease) in Advisor Shares ......................... 362,269 625,078 731,539 61,089
============ ============= ============ ============
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 99
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR THE YEARS OR PERIOD ENDED OCTOBER 31, (UNLESS OTHERWISE INDICATED)
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD
NET ASSET DIVIDENDS
VALUE, NET NET REALIZED TOTAL FROM FROM NET DISTRIBUTIONS
BEGINNING INVESTMENT AND UNREALIZED INVESTMENT INVESTMENT FROM NET TOTAL
OF PERIOD INCOME (LOSS) GAINS OPERATIONS INCOME REALIZED GAIN DISTRIBUTIONS
--------- ------------- -------------- ---------- ---------- ------------- -------------
NORTH AMERICAN EQUITY FUND
Investor Shares
2007 ........... $ 12.63 $ 0.31 $ 1.49 $ 1.80 $ (0.28) $ (0.63) $ (0.91)
2006 ........... 11.15 0.23 1.53 1.76 (0.10) (0.18) (0.28)
2005(b) ........ 11.00 0.06 0.63 0.69 (0.05) (0.49) (0.54)
2005(c) ........ 10.88 0.22 0.62 0.84 (0.20) (0.52) (0.72)
2004(c)(d) ..... 10.00 0.09 0.86 0.95 (0.04) (0.03) (0.07)
Advisor Shares
2007 ........... $ 12.61 $ 0.19 $ 1.56 $ 1.75 $ (0.25) $ (0.63) $ (0.88)
2006(e) ........ 11.84 0.22 0.55 0.77 -- -- --
INTERNATIONAL DIVERSIFIED VALUE FUND
Investor Shares
2007 ........... $ 10.54 $ 0.48 $ 2.80 $ 3.28 $ (0.11) $ (0.06) $ (0.17)
2006(f) ........ 10.00 0.04 0.50 0.54 -- -- --
Advisor Shares
2007 ........... $ 10.53 $ 0.43 $ 2.83+ $ 3.26 $ (0.11) $ (0.06) $ (0.17)
2006(f) ........ 10.00 0.04 0.49 0.53 -- -- --
U.S. OPPORTUNITIES FUND
Investor Shares
2007 ........... $ 23.06 $ 0.02(1) $ 4.30+ $ 4.32 $ -- $ (1.98) $ (1.98)
2006 ........... 19.66 --(h) 4.15+ 4.15 -- (0.75) (0.75)
2005 ........... 19.58 --(h) 2.11+ 2.11 -- (2.03) (2.03)
2004 ........... 16.18 --(h) 3.40+ 3.40 -- -- --
2003 ........... 12.57 (0.16) 4.11 3.95 -- (0.34) (0.34)
Advisor Shares
2007 ........... $ 23.04 $ (0.04)(1) $ 4.30++ $ 4.26 $ -- $ (1.98) $ (1.98)
2006(g) ........ 22.21 --(h) 0.83 0.83 -- -- --
U.S. SMALL AND MID CAP OPPORTUNITIES FUND
Investor Shares
2007 ........... $ 10.25 $ (0.03)(1) $ 2.35+ $ 2.32 $ (0.01) $ -- $ (0.01)
2006(e) ........ 10.00 --(h) 0.25 0.25 -- -- --
Advisor Shares
2007 ........... $ 10.23 $ (0.05)(1) $ 2.35+ $ 2.30 $ -- $ -- $ --
2006(e) ........ 10.00 --(h) 0.23 0.23 -- -- --
* Had custody offsets been included the ratios would have been 1.40% and
1.64% for the Investor Shares and Advisor Shares, respectively.
+ Includes redemption fees. Amount was less than $0.01 per share.
++ Includes redemption fees of $0.01 per share.
(1) Per share net investment loss calculated using average shares.
(a) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown (See Note 3). Total return
calculations for a period of less than one year are not annualized.
(b) For the six months ended October 31, 2005. The North American Equity
Fund's fiscal year end changed from April 30 to October 31. All ratios for
the period have been annualized, except for the Total Return and the
Portfolio Turnover Rate.
(c) For the year or period ended April 30.
(d) Commenced operations on September 17, 2003. All ratios for the period have
been annualized, except for the Total Return and the Portfolio Turnover
Rate.
(e) Commenced operations on March 31, 2006. All ratios for the period have
been annualized, except for the Total Return and the Portfolio Turnover
Rate.
(f) Commenced operations on August 30, 2006. All ratios for the period have
been annualized, except for the Total Return and the Portfolio Turnover
Rate.
(g) Commenced operations on May 15, 2006. All ratios for the period have been
annualized, except for the Total Return and the Portfolio Turnover Rate.
(h) Amount was less than $0.01 per share.
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 100
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
RATIO OF
EXPENSES TO
AVERAGE NET ASSETS
NET ASSET NET ASSETS, (INCLUDING WAIVERS AND
VALUE, END TOTAL END OF REIMBURSEMENTS,
OF PERIOD RETURN(a) PERIOD (000) EXCLUDING OFFSETS)
---------- --------- ------------ ----------------------
NORTH AMERICAN EQUITY FUND
Investor Shares
2007 ........... $ 13.52 15.08% $ 809,998 0.33%
2006 ........... 12.63 16.04 1,261,983 0.33
2005(b) ........ 11.15 6.35 1,303,276 0.35
2005(c) ........ 11.00 7.59 883,146 0.33
2004(c)(d) ..... 10.88 9.56 890,929 0.37
Advisor Shares
2007 ........... $ 13.48 14.66% $ 133 0.68%
2006(e) ........ 12.61 6.50 107 0.68
INTERNATIONAL DIVERSIFIED VALUE FUND
Investor Shares
2007 ........... $ 13.65 31.56% $ 12,479 1.25%
2006(f) ........ 10.54 5.40 9,484 1.25
Advisor Shares
2007 ........... $ 13.62 31.31% $ 1,660 1.50%
2006(f) ........ 10.53 5.30 1,053 1.50
U.S. OPPORTUNITIES FUND
Investor Shares
2007 ........... $ 25.40 20.02% $ 302,351 1.25%
2006 ........... 23.06 21.67 231,009 1.21
2005 ........... 19.66 11.26 140,467 1.13
2004 ........... 19.58 21.01 73,679 1.62
2003 ........... 16.18 32.13 46,783 1.93
Advisor Shares
2007 ........... $ 25.32 19.76% $ 5,910 1.50%
2006(g) ........ 23.04 3.74 667 1.68
U.S. SMALL AND MID CAP OPPORTUNITIES FUND
Investor Shares
2007 ........... $ 12.56 22.60% $ 10,197 1.40%
2006(e) ........ 10.25 2.50 6,952 1.55*
Advisor Shares
2007 ........... $ 12.53 22.48% $ 1,420 1.65%
2006(e) ........ 10.23 2.30 512 1.79*
RATIO OF
RATIO OF NET INVESTMENT
EXPENSES TO INCOME (LOSS) TO
AVERAGE NET ASSETS AVERAGE NET ASSETS
(EXCLUDING WAIVERS, (INCLUDING WAIVERS, PORTFOLIO
REIMBURSEMENTS REIMBURSEMENTS TURNOVER
AND OFFSETS) AND OFFSETS) RATE
------------------- ------------------- ---------
NORTH AMERICAN EQUITY FUND
Investor Shares
2007 ........... 0.33% 1.82% 38%
2006 ........... 0.33 1.66 51
2005(b) ........ 0.35 1.39 30
2005(c) ........ 0.33 1.79 89
2004(c)(d) ..... 0.37 1.29 54
Advisor Shares
2007 ........... 0.68% 1.41% 38%
2006(e) ........ 0.68 1.17 51
INTERNATIONAL DIVERSIFIED VALUE FUND
Investor Shares
2007 ........... 3.85% 2.97% 58%
2006(f) ........ 8.61 2.30 7
Advisor Shares
2007 ........... 4.12% 2.76% 58%
2006(f) ........ 8.86 2.05 7
U.S. OPPORTUNITIES FUND
Investor Shares
2007 ........... 1.25% 0.10% 77%
2006 ........... 1.21 (0.11) 101
2005 ........... 1.13 (0.29) 107
2004 ........... 1.62 (0.83) 144
2003 ........... 2.25 (1.22) 162
Advisor Shares
2007 ........... 1.50% (0.17)% 77%
2006(g) ........ 1.68 (0.31) 101
U.S. SMALL AND MID CAP OPPORTUNITIES FUND
Investor Shares
2007 ........... 3.13% (0.23)% 93%
2006(e) ........ 6.14 (0.05) 46
Advisor Shares
2007 ........... 3.37% (0.45)% 93%
2006(e) ........ 6.89 (0.33) 46
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The accompanying notes are an integral part of the financial statements. 101
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR THE YEARS OR PERIOD ENDED OCTOBER 31, (UNLESS OTHERWISE INDICATED)
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD
NET ASSET DIVIDENDS
VALUE, NET NET REALIZED AND TOTAL FROM FROM NET DISTRIBUTIONS
BEGINNING INVESTMENT UNREALIZED GAINS INVESTMENT INVESTMENT FROM NET TOTAL
OF PERIOD INCOME (LOSSES) OPERATIONS INCOME REALIZED GAIN DISTRIBUTIONS
--------- ---------- ---------------- ---------- ---------- ------------- -------------
INTERNATIONAL ALPHA FUND
Investor Shares
2007 ................. $ 10.64 $ 0.11(1) $ 2.78+ $ 2.89 $ (0.09) $ -- $ (0.09)
2006 ................. 8.35 0.12 2.34 2.46 (0.17) -- (0.17)
2005 ................. 7.08 0.14 1.22 1.36 (0.09) -- (0.09)
2004 ................. 6.37 0.09 0.75 0.84 (0.13) -- (0.13)
2003 ................. 5.37 0.10 1.08 1.18 (0.12) (0.06) (0.18)
Advisor Shares
2007 ................. $ 10.64 $ 0.07(1) $ 2.77+ $ 2.84 $ (0.08) $ -- $ (0.08)
2006(b) .............. 10.23 --(f) 0.41+ 0.41 -- -- --
EMERGING MARKET EQUITY FUND
Investor Shares
2007 ................. $ 10.55 $ 0.04 $ 7.37 $ 7.41 $ (0.05) $ -- $ (0.05)
2006(c) .............. 10.00 0.04 0.51 0.55 -- -- --
Advisor Shares
2007 ................. $ 10.53 $ 0.02 $ 7.34 $ 7.36 $ (0.03) $ -- $ (0.03)
2006(c) .............. 10.00 0.04 0.49 0.53 -- -- --
ENHANCED INCOME FUND
Investor Shares
2007 ................. $ 9.92 $ 0.54 $ (0.21) $ 0.33 $ (0.54) $ -- $ (0.54)
2006 ................. 9.96 0.49 (0.03) 0.46 (0.50) -- (0.50)
2005(d) .............. 10.00 0.26 (0.04) 0.22 (0.26) -- (0.26)
Advisor Shares
2007 ................. $ 9.92 $ 0.51 $ (0.21) $ 0.30 $ (0.51) $ -- $ (0.51)
2006 ................. 9.96 0.47 (0.04) 0.43 (0.47) -- (0.47)
2005(d) .............. 10.00 0.23 (0.04) 0.19 (0.23) -- (0.23)
STRATEGIC BOND FUND
Investor Shares
2007 ................. $ 10.05 $ 0.42(1) $ (0.01) $ 0.41 $ (0.41) $ -- $ (0.41)
2006(e) .............. 10.00 0.10 0.03 0.13 (0.08) -- (0.08)
Advisor Shares
2007 ................. $ 10.04 $ 0.39(1) $ (0.00)+(f) $ 0.39 $ (0.38) $ -- $ (0.38)
2006(e) .............. 10.00 0.10 0.01 0.11 (0.07) -- (0.07)
* Had custody offsets been included the ratios would have been 1.75% and
2.00% for the Investor Shares and Advisor Shares, respectively.
** Had custody offsets been included the ratios would have been 1.15% and
1.40% for the Investor Shares and Advisor Shares, respectively.
+ Includes redemption fees. Amount was less than $0.01 per share.
(1) Per share net investment income calculated using average shares.
(a) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown (See Note 3). Total return
calculations for a period of less than one year are not annualized.
(b) Commenced operations on May 15, 2006. All ratios for the period have been
annualized, except for the Total Return and the Portfolio Turnover Rate.
(c) Commenced operations on March 31, 2006. All ratios for the period have
been annualized, except for the Total Return and the Portfolio Turnover
Rate.
(d) Commenced operations on December 31, 2004. All ratios for the period have
been annualized, except for the Total Return and the Portfolio Turnover
Rate.
(e) Commenced operations on June 30, 2006. All ratios for the period have been
annualized, except for the Total Return and the Portfolio Turnover Rate.
(f) Amount was less than $0.01 per share.
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 102
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
RATIO OF
EXPENSES TO
AVERAGE NET ASSETS
NET ASSET NET ASSETS, (INCLUDING WAIVERS AND
VALUE, END TOTAL END OF REIMBURSEMENTS,
OF PERIOD RETURN(a) PERIOD (000) EXCLUDING OFFSETS)
---------- --------- ------------ ----------------------
INTERNATIONAL ALPHA FUND
Investor Shares
2007 ................. $ 13.44 27.38% $ 28,483 1.25%
2006 ................. 10.64 29.86 22,962 1.25
2005 ................. 8.35 19.45 6,545 1.25
2004 ................. 7.08 13.31 5,233 1.25
2003 ................. 6.37 22.66 6,242 1.25
Advisor Shares
2007 ................. $ 13.40 26.92% $ 28,308 1.50%
2006(b) .............. 10.64 4.01 21,481 1.50
EMERGING MARKET EQUITY FUND
Investor Shares
2007 ................. $ 17.91 70.50% $ 27,774 1.75%
2006(c) .............. 10.55 5.50 12,767 1.87*
Advisor Shares
2007 ................. $ 17.86 70.09% $ 2,594 2.00%
2006(c) .............. 10.53 5.30 1,053 2.12*
ENHANCED INCOME FUND
Investor Shares
2007 ................. $ 9.71 3.37% $ 112,429 0.40%
2006 ................. 9.92 4.68 108,435 0.40
2005(d) .............. 9.96 2.17 101,106 0.40
Advisor Shares
2007 ................. $ 9.71 3.11% $ 1,154 0.65%
2006 ................. 9.92 4.40 1,105 0.65
2005(d) .............. 9.96 1.96 1,029 0.65
STRATEGIC BOND FUND
Investor Shares
2007 ................. $ 10.05 4.13% $ 32,023 1.15%
2006(e) .............. 10.05 1.28 19,236 1.23**
Advisor Shares
2007 ................. $ 10.05 3.98% $ 2,299 1.40%
2006(e) .............. 10.04 1.12 1,012 1.48**
RATIO OF
RATIO OF NET INVESTMENT
EXPENSES TO INCOME TO
AVERAGE NET ASSETS AVERAGE NET ASSETS
(EXCLUDING WAIVERS, (INCLUDING WAIVERS, PORTFOLIO
REIMBURSEMENTS REIMBURSEMENTS TURNOVER
AND OFFSETS) AND OFFSETS) RATE
------------------- ------------------- ---------
INTERNATIONAL ALPHA FUND
Investor Shares
2007 ................. 1.54% 0.92% 112%
2006 ................. 2.45 1.68 76
2005 ................. 3.88 1.85 126
2004 ................. 3.36 1.16 136
2003 ................. 3.27 2.09 50
Advisor Shares
2007 ................. 1.77% 0.60% 112%
2006(b) .............. 2.43 (0.03) 76
EMERGING MARKET EQUITY FUND
Investor Shares
2007 ................. 2.68% 0.37% 107%
2006(c) .............. 4.88 0.88 49
Advisor Shares
2007 ................. 2.95% 0.08% 107%
2006(c) .............. 5.10 0.71 49
ENHANCED INCOME FUND
Investor Shares
2007 ................. 0.61% 5.44% 33%
2006 ................. 0.72 4.78 78
2005(d) .............. 0.82 3.08 61
Advisor Shares
2007 ................. 0.86% 5.19% 33%
2006 ................. 0.97 4.53 78
2005(d) .............. 1.07 2.69 61
STRATEGIC BOND FUND
Investor Shares
2007 ................. 1.77% 4.17% 725%
2006(e) .............. 4.67 3.56 321
Advisor Shares
2007 ................. 2.15% 3.89% 725%
2006(e) .............. 4.92 3.31 321
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 103
- --------------------------------------------------------------------------------
SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR THE YEARS OR PERIOD ENDED OCTOBER 31, (UNLESS OTHERWISE INDICATED)
SELECTED PER SHARE DATA AND RATIOS FOR A SHARE OUTSTANDING THROUGHOUT EACH
PERIOD
NET ASSET DIVIDENDS
VALUE, NET NET REALIZED AND TOTAL FROM FROM NET DISTRIBUTIONS
BEGINNING INVESTMENT UNREALIZED GAINS INVESTMENT INVESTMENT FROM NET TOTAL
OF PERIOD INCOME (LOSSES) OPERATIONS INCOME REALIZED GAIN DISTRIBUTIONS
--------- ---------- ---------------- ---------- ---------- ------------- -------------
TOTAL RETURN FIXED INCOME FUND
Investor Shares
2007 ................... $ 9.81 $ 0.50 $ (0.03) $ 0.47 $ (0.49) $ -- $ (0.49)
2006 ................... 9.85 0.48 (0.01) 0.47 (0.49) (0.02) (0.51)
2005(b) ................ 10.00 0.30 (0.15) 0.15 (0.30) -- (0.30)
Advisor Shares
2007 ................... $ 9.82 $ 0.47 $ (0.04) $ 0.43 $ (0.46) $ -- $ (0.46)
2006 ................... 9.85 0.44 -- 0.44 (0.45) (0.02) (0.47)
2005(b) ................ 10.00 0.28 (0.15) 0.13 (0.28) -- (0.28)
MUNICIPAL BOND FUND
Investor Shares
2007 ................... $ 10.10 $ 0.40 $ (0.16) $ 0.24 $ (0.40) $ -- $ (0.40)
2006 ................... 9.97 0.40 0.12 0.52 (0.39) -- (0.39)
2005 ................... 10.12 0.36 (0.15) 0.21 (0.36) -- (0.36)
2004(c) ................ 10.00 0.24 0.11 0.35 (0.23) -- (0.23)
Advisor Shares
2007 ................... $ 10.10 $ 0.38 $ (0.16) $ 0.22 $ (0.38) $ -- $ (0.38)
2006 ................... 9.97 0.37 0.13 0.50 (0.37) -- (0.37)
2005 ................... 10.11 0.34 (0.14) 0.20 (0.34) -- (0.34)
2004(c) ................ 10.00 0.21 0.11 0.32 (0.21) -- (0.21)
SHORT-TERM MUNICIPAL BOND FUND
Investor Shares
2007 ................... $ 9.96 $ 0.39 $ (0.10) $ 0.29 $ (0.38) $ -- $ (0.38)
2006 ................... 9.92 0.35 0.04 0.39 (0.35) -- (0.35)
2005 ................... 9.97 0.29 (0.05) 0.24 (0.29) -- (0.29)
2004(c) ................ 10.00 0.15 (0.03) 0.12 (0.15) -- (0.15)
Advisor Shares
2007 ................... $ 9.96 $ 0.36 $ (0.09) $ 0.27 $ (0.36) $ -- $ (0.36)
2006 ................... 9.92 0.32 0.04 0.36 (0.32) -- (0.32)
2005 ................... 9.97 0.27 (0.05) 0.22 (0.27) -- (0.27)
2004(c) ................ 10.00 0.13 (0.03) 0.10 (0.13) -- (0.13)
* Had custody offsets been included the ratios would have been 0.55% and
0.80% for the Investor Shares and Advisor Shares, respectively.
(a) Total returns would have been lower had certain Fund expenses not been
waived or reimbursed during the periods shown (See Note 3). Total return
calculations for a period of less than one year are not annualized.
(b) Commenced operations on December 31, 2004. All ratios for the period have
been annualized, except for the Total Return and the Portfolio Turnover
Rate.
(c) Commenced operations on December 31, 2003. All ratios for the period have
been annualized, except for the Total Return and the Portfolio Turnover
Rate.
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 104
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
RATIO OF
EXPENSES TO
AVERAGE NET ASSETS
NET ASSET NET ASSETS, (INCLUDING WAIVERS AND
VALUE, END TOTAL END OF REIMBURSEMENTS,
OF PERIOD RETURN(a) PERIOD (000) EXCLUDING OFFSETS)
---------- --------- ------------ ----------------------
TOTAL RETURN FIXED INCOME FUND
Investor Shares
2007 ................... $ 9.79 4.90% $ 71,259 0.40%
2006 ................... 9.81 4.90 21,795 0.40
2005(b) ................ 9.85 1.51 9,138 0.40
Advisor Shares
2007 ................... $ 9.79 4.53% $ 852 0.65%
2006 ................... 9.82 4.56 1,060 0.65
2005(b) ................ 9.85 1.30 1,013 0.65
MUNICIPAL BOND FUND
Investor Shares
2007 ................... $ 9.94 2.45% $ 656,027 0.55%
2006 ................... 10.10 5.36 244,919 0.55
2005 ................... 9.97 2.14 96,114 0.55
2004(c) ................ 10.12 3.53 45,781 0.56*
Advisor Shares
2007 ................... $ 9.94 2.19% $ 18,162 0.80%
2006 ................... 10.10 5.10 14,797 0.80
2005 ................... 9.97 1.99 8,375 0.80
2004(c) ................ 10.11 3.21 1,888 0.81*
SHORT-TERM MUNICIPAL BOND FUND
Investor Shares
2007 ................... $ 9.87 2.96% $ 233,532 0.55%
2006 ................... 9.96 3.97 187,268 0.55
2005 ................... 9.92 2.47 131,062 0.55
2004(c) ................ 9.97 1.26 74,031 0.56*
Advisor Shares
2007 ................... $ 9.87 2.70% $ 10,924 0.80%
2006 ................... 9.96 3.71 3,735 0.80
2005 ................... 9.92 2.21 3,112 0.80
2004(c) ................ 9.97 1.05 1,320 0.81*
RATIO OF
RATIO OF NET INVESTMENT
EXPENSES TO INCOME TO
AVERAGE NET ASSETS AVERAGE NET ASSETS
(EXCLUDING WAIVERS, (INCLUDING WAIVERS, PORTFOLIO
REIMBURSEMENTS REIMBURSEMENTS TURNOVER
AND OFFSETS) AND OFFSETS) RATE
------------------- ------------------- ---------
TOTAL RETURN FIXED INCOME FUND
Investor Shares
2007 ................... 0.96% 4.97% 464%
2006 ................... 2.05 4.86 295
2005(b) ................ 3.05 3.61 571
Advisor Shares
2007 ................... 1.48% 4.73% 464%
2006 ................... 2.37 4.59 295
2005(b) ................ 3.30 3.35 571
MUNICIPAL BOND FUND
Investor Shares
2007 ................... 0.63% 4.09% 6%
2006 ................... 0.77 4.06 15
2005 ................... 0.93 3.70 27
2004(c) ................ 1.41 2.82 46
Advisor Shares
2007 ................... 0.88% 3.83% 6%
2006 ................... 1.01 3.79 15
2005 ................... 1.18 3.52 27
2004(c) ................ 1.64 2.49 46
SHORT-TERM MUNICIPAL BOND FUND
Investor Shares
2007 ................... 0.67% 3.92% 21%
2006 ................... 0.77 3.55 24
2005 ................... 0.85 3.03 36
2004(c) ................ 1.30 1.95 17
Advisor Shares
2007 ................... 0.92% 3.69% 21%
2006 ................... 1.01 3.29 24
2005 ................... 1.10 2.80 36
2004(c) ................ 1.44 1.68 17
- --------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 105
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SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 2007
NOTE 1 -- ORGANIZATION
Schroder Global Series Trust ("SGST") is an open-end series management
investment company registered under the Investment Company Act of 1940, as
amended. SGST was organized as a business trust under the laws of The
Commonwealth of Massachusetts on May 27, 2003. SGST has an unlimited number of
authorized shares. Schroder North American Equity Fund (the "SGST Fund") is the
only series of shares currently comprising the Trust. Advisor Shares of the SGST
Fund were offered beginning on March 31, 2006.
Schroder Capital Funds (Delaware) ("SCFD") is an open-end series management
investment company registered under the Investment Company Act of 1940, as
amended. SCFD was organized as a Maryland corporation on July 30, 1969;
reorganized as Schroder Capital Funds, Inc., a series company, on February 29,
1988; and reorganized on January 9, 1996, as a Delaware business trust. SCFD has
an unlimited number of authorized shares, which are divided into two separate
series: Schroder U.S. Opportunities Fund and Schroder International Alpha Fund
(collectively, the "SCFD Funds"). Advisor Shares of Schroder U.S. Opportunities
and Schroder International Alpha Funds were offered beginning on May 15, 2006. A
third series of SCFD, Schroder U.S. Large Cap Equity Fund, was liquidated
following its close of business on April 27, 2006. On April 18, 2007, the
Schroder U.S. Opportunities Fund closed to new investors.
Schroder Series Trust ("SST") is an open-end series management investment
company registered under the Investment Company Act of 1940, as amended. SST was
organized as a business trust under the laws of The Commonwealth of
Massachusetts on May 6, 1993. SST has an unlimited number of authorized shares,
which are divided into eight separate series: Schroder International Diversified
Value Fund, Schroder U.S. Small and Mid Cap Opportunities Fund, Schroder
Emerging Market Equity Fund, Schroder Enhanced Income Fund, Schroder Strategic
Bond Fund, Schroder Total Return Fixed Income Fund, Schroder Municipal Bond Fund
and Schroder Short-Term Municipal Bond Fund (collectively, the "SST Funds," and
together with the SCFD Funds and the SGST Fund, the "Funds"). Schroder U.S.
Small and Mid Cap Opportunities Fund and Schroder Emerging Market Equity Fund
commenced operations on March 31, 2006. Schroder International Diversified Value
Fund and Schroder Strategic Bond Fund commenced operations as of August 30, 2006
and June 30, 2006, respectively.
NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Funds which are in conformity with accounting principles generally accepted in
the United States of America.
VALUATION OF INVESTMENTS: Portfolio securities listed on recognized stock
exchanges are valued at the last reported sale price on the exchange on which
the securities are principally traded, except that NASDAQ official closing
prices for all NASDAQ National Market and NASDAQ Small Cap Market Securities are
used, where applicable. Listed securities traded on recognized stock exchanges
where last sale prices are not available are valued at the mean of the closing
bid and asked prices ("mid-market price"). Securities traded in over-the-counter
markets are valued at the most recent reported sales price or, if none,
mid-market price for unlisted securities with readily available market
quotations. Options on indices or exchange-traded fund (ETF) shares are valued
at the closing mid-market price. Prices used for valuations generally are
provided by independent pricing services. Except as noted below with regard to
below investment grade and emerging markets debt instruments, fixed income
securities with remaining maturities of more than 60 days are valued on the
basis of valuations provided by pricing services that determine valuations for
normal institutional size trading units of fixed income securities, or through
obtaining independent quotes from market makers. Below investment grade and
emerging markets debt instruments ("high yield debt") will ordinarily be valued
at prices supplied by a Fund's pricing service based on the mean of bid and
asked prices supplied by brokers or dealers. Short-term investments, having a
maturity of 60 days or less, are valued at amortized cost, a form of fair
valuation which approximates market value, pursuant to procedures adopted by the
Funds' Board of Trustees ("Trustees") unless SIMNA (as defined in Note 3)
believes another valuation is more appropriate. Other securities and assets for
which market quotations are not readily available are valued in accordance with
Fair Value Procedures established by the Funds' Trustees. The Funds' Fair Value
Procedures are implemented through a Fair Value Committee (the "Committee")
designated by the Funds' Trustees. Some of the more common reasons that may
necessitate that a security be valued using Fair Value Procedures include: the
security's trading has been halted or suspended; the security has been de-listed
from a national exchange; the security's primary trading market
- --------------------------------------------------------------------------------
106
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SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
is temporarily closed at a time when under normal conditions it would be open;
or the security's primary pricing source is not able or willing to provide a
price. When a security is valued in accordance with the Fair Value Procedures,
the Committee will determine the value after taking into consideration relevant
information reasonably available to the Committee.
For securities that principally trade on a foreign market or exchange, a
significant gap in time can exist between the time of a particular security's
last trade and the time at which a Fund calculates its net asset value. The
closing prices of such securities may no longer reflect their market values at
the time the Fund calculates its net asset value if an event that could
materially affect the value of those securities (a "Significant Event") has
occurred between the time of the security's last trade and the time that the
Fund calculates its net asset value. A Significant Event may relate to a single
issuer or to an entire market sector. If a Fund becomes aware of a Significant
Event that has occurred with respect to a security or group of securities after
the closing of the exchange or market on which the security or securities
principally trade, but before the time at which the Fund calculates its net
asset value, a Committee meeting may be called.
Schroder International Diversified Value, Schroder International Alpha and
Schroder Emerging Market Equity Funds use a third party fair valuation vendor
which provides a fair value for securities of companies located in countries
outside the Western Hemisphere held by the Schroder International Diversified
Value, Schroder International Alpha and Schroder Emerging Market Equity Funds
based on certain factors and methodologies applied by the vendor in the event
that there is movement in the U.S. market that exceeds a specific threshold
established by the Committee in consultation with the Trustees. Such
methodologies generally involve tracking valuation correlations between the U.S.
market and each non-U.S. security. The Committee also determines a "confidence
interval" which will be used, when the threshold is exceeded, to determine the
level of correlation between the value of a foreign security and movements in
the U.S. market before a particular security will be fair valued. In the event
that the threshold established by the Committee is exceeded on a specific day,
the Schroder International Diversified Value, Schroder International Alpha and
Schroder Emerging Market Equity Funds will typically value such securities in
their portfolios that exceed the applicable confidence interval based upon the
fair values provided by the vendor.
REPURCHASE AGREEMENTS: When entering into repurchase agreements, it is each
Fund's policy that the Fund take into its possession, through its custodian, the
underlying collateral and monitor the collateral's value at the time the
agreement is entered into and on a daily basis during the term of the repurchase
agreement to ensure that it equals or exceeds the repurchase price. In the event
of default or bankruptcy by the other party to the agreement, realization and/or
retention of the collateral may be subject to legal proceedings.
INVESTMENT TRANSACTIONS: Investment security transactions are recorded as of
trade date. Realized gains and losses on sales of investments are determined on
the basis of identified cost. Capital gain taxes on securities in certain
foreign countries are accrued on unrealized appreciation and are due when
realized.
INVESTMENT INCOME: Dividend income is recorded on the ex-dividend date. Dividend
income is recorded net of unrecover-able withholding tax. Interest income is
recorded on an accrual basis. Discounts and premiums on fixed income securities
are accreted and amortized using the effective interest method. Foreign dividend
and interest income amounts and realized capital gains or losses are converted
to U.S. dollar equivalents using foreign exchange rates in effect at the date of
the transactions. Distributions received on securities that represent a return
of capital or capital gain are recorded as a reduction of costs of investments
and/or as a realized gain. The Funds estimate the components of distributions
received that may be considered non-taxable distributions or capital gain
distributions.
EXPENSES: Expenses are recorded on an accrual basis. Many of the expenses of the
Funds can be directly attributable to a specific Fund. Expenses not directly
attributable to a specific Fund are allocated among the Funds based on relative
average net assets or another appropriate methodology. Class specific expenses
are borne by that class. Fund expenses are pro-rated to the respective classes
based on relative net assets.
CLASSES OF SHARES: Income, realized and unrealized gains and losses of a Fund
are prorated to the respective classes of shares based on relative net assets.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Dividends and distributions to
shareholders from net investment income and from net realized capital gains, if
any, are declared and distributed at least annually for the Schroder North
American Equity, Schroder International Diversified Value, Schroder U.S.
Opportunities, Schroder U.S. Small and Mid Cap Opportunities, Schroder
International Alpha and Schroder Emerging Market Equity Funds. Dividends to
shareholders from net investment income are declared
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107
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SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
daily and distributed monthly and distributions to shareholders from net
realized capital gains, if any, are declared and distributed at least annually
for the Schroder Enhanced Income, Schroder Total Return Fixed Income, Schroder
Municipal Bond and Schroder Short-Term Municipal Bond Funds. Dividends and
distributions to shareholders from net investment income are declared and
distributed quarterly and distributions to shareholders from net realized
capital gains, if any, are declared and distributed at least annually for the
Schroder Strategic Bond Fund. Distributions are recorded on the ex-dividend
date.
FOREIGN CURRENCY: Foreign currency amounts are translated into U.S. dollars at
the mean of the bid and asked prices of such currencies against U.S. dollars as
follows: (i) assets and liabilities at the rate of exchange at the end of the
respective period; and (ii) purchases and sales of securities and income and
expenses at the rate of exchange prevailing on the dates of such transactions.
The portion of the results of operations arising from changes in the exchange
rates and the portion due to fluctuations arising from changes in the market
prices of securities are not isolated. Such fluctuations are included with the
net realized and unrealized gain or loss on investments.
Certain Funds may enter into forward foreign currency contracts to protect the
U.S. dollar value of the underlying portfolio of securities against the effect
of possible adverse movements in foreign exchange rates. Principal risks
associated with such transactions include the movement in value of the foreign
currency relative to the U.S. dollar and the ability of the counterparty to
perform. Fluctuations in the value of such forward foreign currency transactions
are recorded daily as unrealized gain or loss; realized gain or loss includes
net gain or loss on transactions that have terminated by settlement or by the
Funds entering into offsetting commitments.
WHEN-ISSUED SECURITIES: Each Fund may purchase securities on a when-issued,
delayed delivery, or forward commitment basis. These transactions involve a
commitment by the Fund to purchase a security for a predetermined price or
yield, with payments and delivery taking place more than seven days in the
future, or after a period longer than the customary settlement period for that
type of security. These transactions may increase the overall investment
exposure for a Fund and involve a risk of loss if the value of the securities
declines prior to the settlement date.
DERIVATIVE INSTRUMENTS: Certain Funds may enter into a variety of "derivative"
instruments (for example, options or futures) in order to gain exposure to
particular securities or markets, in connection with hedging transactions, to
adjust the interest rate sensitivity and duration of a Fund's portfolio and to
increase total return. A Fund's use of derivative instruments involves the risk
the instrument may not work as intended due to unanticipated developments in
market conditions or other causes. Derivatives often involve the risk that the
other party to the transaction will be unable or unwilling to perform its
obligations, or that the fund will be unable to close out the position at any
particular time or at an acceptable price. When a Fund uses certain types of
derivative instruments for investment purposes, it could lose more than the
original cost of the investment and its potential loss could be unlimited. Also,
suitable derivative transactions may not be available in all circumstances, and
there can be no assurance that a Fund will engage in these transactions when
that would be beneficial.
FUTURES: Financial futures contracts are valued based upon their quoted daily
settlement prices; changes in initial settlement value (represented by cash paid
to or received from brokers as "variation margin") are accounted for as
unrealized appreciation (depreciation). When futures contracts are closed, the
difference between the opening value at the date of purchase and the value at
closing is recorded as realized gain or loss in the Statements of Operations.
Futures contracts may be used in order to hedge against unfavorable changes in
the value of securities or to attempt to realize profits. Futures contracts
involve leverage and are subject to market risk that may exceed the amounts
recognized in the Statements of Assets and Liabilities. Risks arise from the
possible significant movements in prices. The change in value of futures
contracts primarily corresponds to the value of the securities or other index or
amount underlying the contracts, but may not precisely correlate with the change
in value of such securities or other index or amount. In addition, there is the
risk that a Fund may not be able to enter into a closing transaction because of
an illiquid secondary market.
SWAP AGREEMENTS: Certain Funds may enter into swap agreements, including total
return swaps, credit default swaps and interest rate swaps. A swap agreement is
a two-party contract under which an agreement is made to exchange returns from
predetermined investments, instruments or indices including a particular
interest rate, foreign currency, or "basket" of securities representing a
particular index. The Schroder Enhanced Income, Schroder Strategic Bond and
Schroder Total Return Fixed Income Funds may enter into "credit default" swap
transactions. In a credit default swap, one party pays what is, in effect, an
insurance premium through a
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
stream of payments to another party in exchange for the right to receive a
specified return in the event of a default (or similar events) by a third party
on its obligations. Therefore, in a credit default swap, the Funds may pay a
premium and, in return, have the right to put certain bonds or loans to the
counterparty upon default by the issuer of such bonds or loans (or similar
events) and to receive in return the par value of such bonds or loans (or
another agreed upon amount). The Funds would generally enter into this type of
transaction to limit or reduce risk with respect to bonds or loans that it owns
in its portfolio or otherwise in connection with transactions intended to reduce
one or more risks in the Funds' portfolio. In addition, the Funds could also
receive the premium referenced above, and be obligated to pay a counterparty the
par value of certain bonds or loans upon a default (or similar event) by the
issuer. The Funds would generally enter into this type of transaction as a
substitute for investment in the securities of the issuer, or otherwise to
increase the Funds' investment return. The Funds may also enter into "interest
rate" swap transactions. Interest rate swaps involve the exchange by the Funds
with another party of their respective commitments to pay or receive interest
(e.g., an exchange of floating rate payments for fixed rate payments) with
respect to a notional amount of principal. The Funds could be exposed to credit
or market risk due to unfavorable changes in the fluctuation of interest rates
or if the counterparty defaults on its obligation to perform. Risk of loss may
exceed amounts recognized on the Funds' Statement of Assets and Liabilities.
Depending on their structures, swap agreements may increase or decrease the
Funds' exposure to long-or short-term interest rates (in the United States or
abroad), foreign currency values, mortgage securities, corporate borrowing
rates, or other factors such as security prices or inflation rates. The values
of the Funds' swap positions would increase or decrease depending on the changes
in value of the underlying rates, currency values, or other indices or measures.
The Funds' ability to engage in certain swap transactions may be limited by tax
considerations.
Swaps are marked-to-market daily and the resulting changes in market values, if
any, are recorded as an unrealized gain or loss.
Entering into swap agreements involves certain other risks. Such risks include
for example, the possibility that there will be no liquid market for these
agreements, that the counterparty to the agreement may default on its obligation
to perform and that there may be unfavorable changes in the fluctuation of
interest rates or other rates or values. Risks also arise from potential losses
from adverse market movements.
EQUITY-LINKED AND INDEX-LINKED WARRANTS: The Schroder North American Equity,
Schroder International Diversified Value, Schroder U.S. Small and Mid Cap
Opportunities, Schroder International Alpha and Schroder Emerging Market Equity
Funds may invest in equity-linked and index-linked warrants. A Fund purchases
the equity-linked and index-linked warrants from a broker, who in turn is
expected to purchase shares in the local market and issue a call warrant hedged
on the underlying holdings. If the Fund exercises its call and closes its
position, the shares are expected to be sold and the warrant redeemed with the
proceeds. Each warrant typically represents one share of the underlying stock or
basket of stocks representing the index. Therefore, the price, performance and
liquidity of the warrant are all directly linked to the underlying stock or
index, less transaction costs. Equity-linked warrants are generally valued at
the closing price of the underlying securities, then adjusted for stock
dividends declared by the underlying securities. In addition to the market risk
related to the underlying holdings, the Fund bears additional counterparty risk
with respect to the issuing broker. Moreover, there is currently no active
trading market for either equity-linked or index-linked warrants. A Fund may
also purchase warrants, issued by banks and other financial institutions, whose
values are based on the values from time to time of one or more securities
indices.
RESTRICTED SECURITIES: As of October 31, 2007, the following Funds owned private
placement investments that were purchased through private offerings or acquired
through initial public offerings and cannot be sold without prior registrations
under the Securities Act of 1933 or pursuant to an exemption therefrom. These
investments are valued in accordance with procedures approved by the Trustees.
The acquisition dates of these investments, along with their costs and values as
of October 31, 2007, were as follows:
PRINCIPAL ACQUISITION % OF NET
AMOUNT DATE COST MARKET VALUE ASSETS
- -------------------------------------------------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND
Countrywide Asset-Backed Certificates
4.500%, 8/25/36 $ 9,625 4/27/05 $ 9,555 $ 8,942 0.0%
Countrywide Asset-Backed Certificates
5.500%, 10/25/36 65,480 10/28/05 65,005 9,822 0.0
Countrywide Asset-Backed Certificates
6.000%, 12/29/36 51,316 12/16/05 50,553 25,754 0.0
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
PRINCIPAL ACQUISITION % OF NET
AMOUNT DATE COST MARKET VALUE ASSETS
- -------------------------------------------------------------------------------------------------------------------------
SCHRODER ENHANCED INCOME FUND -- CONTINUED
Fremont NIM Trust
5.500%, 4/25/35 $ 46,129 5/17/05 $ 45,961 $ 16,145 0.0%
GSAMP Trust
5.000%, 10/25/34 9,579 12/9/05 9,463 1,437 0.0
Lehman Brothers Small Balance Commercial IO
0.850%, 2/25/30 20,954,853 4/8/05 489,891 288,129 0.3
Master Asset-Backed Securities NIM Trust
4.750%, 5/26/35 12,334 7/15/05 12,319 603 0.0
Master Asset-Backed Securities NIM Trust
4.940%, 3/26/35 593 5/18/05 593 410 0.0
Master Asset-Backed Securities NIM Trust
4.956%, 5/26/10 58,640 6/20/05 58,640 53,949 0.0
Master Asset-Backed Securities NIM Trust
6.280%, 1/26/36 2,126 3/21/06 2,126 1,807 0.0
Sharps SP I LLC NIM Trust
7.380%, 9/25/35 155,833 2/16/06 155,711 15,583 0.0
Sharps SP I LLC NIM Trust
5.250%, 7/25/35 26,559 2/13/06 26,292 8,615 0.0
SCHRODER STRATEGIC BOND FUND
Master Asset-Backed Securities NIM Trust
7.250%, 8/25/36 56,261 11/23/06 56,225 6,751 0.0
Meritage Mortgage Loan Trust
10.381%, 7/25/34 8,648 9/12/06 8,604 134 0.0
Sharps SP I LLC NIM Trust
6.400%, 6/25/36 47,865 10/15/06 47,613 1,915 0.0
SCHRODER TOTAL RETURN FIXED INCOME FUND
Fremont NIM Trust
5.500%, 4/25/35 27,135 5/17/05 16,742 9,497 0.0
Hedged Mutual Fund Fee Trust
5.220%, 11/30/10 37,324 1/7/05 37,410 37,138 0.1
Hedged Mutual Fund Fee Trust
4.840%, 3/02/11 106,312 1/7/05 106,053 105,780 0.1
SCHRODER MUNICIPAL BOND FUND
Crenshaw County, Industrial Development Board RB
5.600%, 3/01/08 250,000 2/26/00 251,703 250,763 0.0
Jacksonville, Health Facilities RB
5.000%, 11/15/15 125,000 8/25/05 129,116 125,139 0.0
Kidspeace National Centers of Georgia, USDA
6.300%, 12/01/28 250,000 1/5/04 250,000 262,947 0.0
SCHRODER SHORT-TERM MUNICIPAL BOND FUND
Atlantic City, Municipal Utilities Authority RB
5.000%, 1/01/08 3,895,000 6/9/05 3,905,429 3,899,635 1.6
Hapeville, Development Authority RB
6.500%, 8/1/09 490,000 7/12/06 490,000 496,385 0.2
Kidspeace National Centers of Georgia, USDA
6.300%, 12/01/28 250,000 1/5/04 250,000 262,947 0.1
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
MORTGAGE DOLLAR ROLLS: The Schroder Enhanced Income, Schroder Strategic Bond and
the Schroder Total Return Fixed Income Funds may enter into mortgage dollar
rolls (principally using TBAs) in which each Fund sells mortgage securities for
delivery in the current month and simultaneously contracts to repurchase
substantially similar securities in a subsequent month at an agreed-upon price
on a fixed date. Each Fund accounts for such dollar rolls under the purchases
and sales method and receives compensation as consideration for entering into
the commitment to repurchase. Each Fund must maintain liquid securities having a
value not less than the purchase price (including accrued interest) for such
dollar rolls. The market value of the securities that each Fund is required to
purchase may decline below the agreed upon repurchase price of those securities.
The counterparty receives all principal and interest payments, including
repayments, made in respect of a security subject to such a contract while it is
the holder. Mortgage dollar rolls may be renewed with a new purchase and
repurchase price and a cash settlement made on settlement date without physical
delivery of the securities subject to the contract.
OFFERING COSTS: Offering costs, which include prospectus typesetting and
printing and other fees incurred for the preparation of the initial registration
statement of the Schroder International Diversified Value, Schroder U.S. Small
and Mid Cap Opportunities, Schroder Emerging Market Equity, and Schroder
Strategic Bond Funds were amortized over a twelve-month period from each Fund's
inception date and are reflected as amortization of deferred offering costs in
the Statements of Operations.
NOTE 3 -- INVESTMENT ADVISORY FEES, ADMINISTRATION AGREEMENTS AND
DISTRIBUTIONS PLANS
The Funds have entered into investment advisory agreements with Schroder
Investment Management North America, Inc. ("SIMNA"). Under these agreements,
SIMNA provides investment management services and is entitled to receive for its
services compensation, payable monthly, at the following annual rates based on
average daily net assets of each Fund taken separately: 0.25% for each of the
Schroder North American Equity Fund, Schroder Enhanced Income Fund and Schroder
Total Return Fixed Income Fund; 1.00% for each of Schroder International
Diversified Value Fund, Schroder U.S. Opportunities Fund, Schroder U.S. Small
and Mid Cap Opportunities Fund and Schroder Emerging Market Equity Fund; 0.975%
for the Schroder International Alpha Fund; 0.75% for the Schroder Strategic Bond
Fund; and 0.40% for each of Schroder Municipal Bond Fund and Schroder Short-Term
Municipal Bond Fund.
SIMNA has retained its affiliate, Schroder Investment Management North America
Limited ("SIMNA Ltd.") to serve as sub-advisor responsible for the portfolio
management of the Schroder North American Equity Fund, the Schroder
International Diversified Value Fund, the Schroder International Alpha Fund, the
Schroder Emerging Market Equity Fund and the Schroder Strategic Bond Fund. SIMNA
pays SIMNA Ltd. 50% of the investment advisory fees it receives from these
Funds.
The administrator of SGST is Schroder Fund Advisors, Inc. ("Schroder Advisors"),
a wholly owned subsidiary of SIMNA. Schroder Advisors receives no compensation
for its services for the Schroder North American Equity Fund. SIMNA acts as
administrator to the Schroder U.S. Opportunities Fund and the Schroder
International Alpha Fund. SIMNA's compensation for its services as administrator
is included in the Schroder U.S. Opportunities and the Schroder International
Alpha Fund's advisory fees.
Effective November 5, 2001, SCFD entered into a sub-administration and
accounting agreement with SEI Investments Global Funds Services ("SEI") and
Schroder Advisors. On January 4, 2004, SST entered into an amended
administration and accounting agreement with SEI. On January 31, 2005, SGST
entered into a sub-administration and accounting agreement with SEI. Effective
November 1, 2004, under the agreements with SEI, the SCFD Funds and the SST
Funds pay fees to SEI based on the combined average daily net assets of all the
SCFD Funds and the SST Funds according to the following annual rates: 0.115% on
the first $600 million of such assets, 0.11% on the next $400 million of such
assets, 0.09% on the next $1 billion of such assets and 0.07% on assets in
excess of $2 billion. Each Fund pays its pro rata portion of such expenses.
Effective January 28, 2005, SGST pays SEI a fee, computed and paid monthly, at
an annual rate of 0.013% of the SGST Fund's average daily net assets up to $1
billion and 0.005% of the SGST Fund's average daily net assets over $1 billion.
In order to limit the expenses of the Investor Shares of certain Funds, the
Funds' adviser has contractually agreed to reduce its compensation (and, if
necessary, to pay other Fund expenses) until February 28, 2008 to the extent
that the total annual fund operating expenses of a Fund (other than acquired
fund fees and expenses, interest, taxes, and extraordinary expenses) allocable
to each Fund's Investor Shares exceed the following annual rates (based on the
average daily net assets attributable to each Fund's Investor Shares): Schroder
International Diversified Value Fund: 1.25%; Schroder U.S. Opportunities Fund
(effective May 1, 2006): 1.70%; Schroder U.S. Small and Mid Cap Opportunities
Fund: 1.40%; Schroder International Alpha Fund: 1.25%; Schroder Emerging Market
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
Equity Fund: 1.75%; Schroder Enhanced Income Fund: 0.40%; Schroder Strategic
Bond Fund: 1.15%; Schroder Total Return Fixed Income Fund: 0.40%; Schroder
Municipal Bond Fund: 0.55%; and Schroder Short-Term Municipal Bond Fund: 0.55%.
In addition, in order to limit the expenses of the Advisor Shares of certain
Funds, the Funds' adviser has contractually agreed to reduce its compensation
(and, if necessary, to pay other Fund expenses) until February 28, 2008 to the
extent that the total annual fund operating expenses of a Fund (other than
acquired fund fees and expenses, interest, taxes, and extraordinary expenses)
allocable to each Fund's Advisor Shares exceed the following annual rates (based
on the average daily net assets attributable to each Fund's Advisor Shares):
Schroder International Diversified Value Fund: 1.50%; Schroder U.S.
Opportunities Fund: 1.95%; Schroder U.S. Small and Mid Cap Opportunities Fund:
1.65%; Schroder International Alpha Fund: 1.50%; Schroder Emerging Market Equity
Fund: 2.00%; Schroder Enhanced Income Fund: 0.65%; Schroder Strategic Bond Fund:
1.40%; Schroder Total Return Fixed Income Fund: 0.65%; Schroder Municipal Bond
Fund: 0.80%; and Schroder Short-Term Municipal Bond Fund: 0.80%. These fee
waivers have been extended until February 29, 2008.
The Funds have adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1
under the Investment Company Act of 1940, as amended, that allows each Fund to
pay distribution and other fees with respect to its Advisor Shares. Under the
Plan, a Fund may make payments at an annual rate of up to 0.25%, except for the
Schroder North American Equity Fund which may make payments at an annual rate of
up to 0.35%, of the daily net assets attributable to its Advisor Shares to
compensate Schroder Advisors for distribution services and certain shareholder
services with respect to the Fund's Advisor Shares.
NOTE 4 -- REDEMPTION FEE
The Schroder International Diversified Value, Schroder U.S. Opportunities,
Schroder U.S. Small and Mid Cap Opportunities, Schroder International Alpha,
Schroder Emerging Market Equity and Schroder Strategic Bond Funds generally
impose a 2.00% redemption fee on shares redeemed (including in connection with
an exchange) two months or less from their date of purchase. These fees, which
are not sales charges, are retained by the Funds and not paid to Schroder
Advisors or any other entity. The redemption fees are included in the Statements
of Changes in Net Assets under "Redemption fees," and are included as part of
Capital paid-in on the Statements of Assets and Liabilities. The redemption fees
paid to the Schroder International Diversified Value, Schroder U.S.
Opportunities, Schroder U.S. Small and Mid Cap Opportunities, Schroder
International Alpha, Schroder Emerging Market Equity and Schroder Strategic Bond
Funds for the year ended October 31, 2007 totaled $316, $10,414, $195, $551, $0
and $126, respectively.
NOTE 5 -- TRANSACTIONS WITH AFFILIATES
TRUSTEES' FEES: The Funds pay no compensation to Trustees who are interested
persons of the Trusts, SIMNA or Schroder Advisors. For their services as
Trustees of all open-end investment companies distributed by Schroder Advisors
for the year ended October 31, 2007, Trustees who are not interested persons of
the Funds, SIMNA or Schroder Advisors received an annual retainer of $25,000 and
$2,500 per meeting attended in person or $1,000 per meeting attended by
telephone. Members of an Audit Committee for one or more of such Funds received
an additional $1,000 per year, with the Audit Committee chair receiving a $5,000
retainer. Payment of meeting fees were allocated only among those Funds to which
the meeting related. Effective November 1, 2006, several Trustees became Trustee
Emeritus. For their services, the Emeritus trustees instead receive an annual
retainer of $15,000, for a period of two years.
Officers of the Funds are also officers of SIMNA and Schroder Advisors. Such
officers are paid no fees by the Funds for serving as officers of the Funds.
NOTE 6 -- INVESTMENT TRANSACTIONS
Purchases and proceeds from sales and maturities of investments, excluding
short-term securities for each Fund, for the year ended October 31, 2007 were as
follows:
PURCHASES SALES AND MATURITIES
------------ --------------------
Schroder North American Equity Fund ...................... $375,189,942 $654,623,072
Schroder International Diversified Value Fund ............ 7,943,978 7,080,952
Schroder U.S. Opportunities Fund ......................... 214,812,475 191,988,708
Schroder U.S. Small and Mid Cap Opportunities Fund ....... 10,087,606 8,580,499
Schroder International Alpha Fund ........................ 61,681,472 61,838,108
Schroder Emerging Market Equity Fund ..................... 24,767,156 20,463,005
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
PURCHASES SALES AND MATURITIES
------------ --------------------
Schroder Enhanced Income Fund ............................ $ 17,452,588 $ 34,586,359
Schroder Strategic Bond Fund ............................. 30,831,039 28,226,038
Schroder Total Return Fixed Income Fund .................. 30,067,451 27,982,483
Schroder Municipal Bond Fund ............................. 344,436,525 21,020,431
Schroder Short-Term Municipal Bond Fund .................. 74,783,210 30,201,148
Purchases and proceeds from sales and maturities of U.S. Government securities
for the year ended October 31, 2007 were as follows:
PURCHASES SALES AND MATURITIES
------------ --------------------
Schroder Enhanced Income Fund ............................ $ 10,032,385 $ 8,977,348
Schroder Strategic Bond Fund ............................. 160,637,830 159,130,241
Schroder Total Return Fixed Income Fund .................. 129,525,570 131,650,601
Both redemptions and subscriptions in-kind reflect the valuation of the
underlying securities in accordance with the Funds' valuation policy. The asset
price used to affect the redemption is the respective asset price used to
calculate the net asset value of the shares redeemed. For the years ended
October 31, 2007 and October 31, 2006 the Schroder North American Equity Fund
realized gains from in-kind redemptions of $60,232,563 and $29,225,391,
respectively.
NOTE 7 -- FEDERAL INCOME TAXES
It is the intention of the Funds for each Fund to continue to qualify as a
"regulated investment company" by complying with the requirements of Subchapter
M of the Internal Revenue Code of 1986, as amended. By so qualifying, the Funds
would not be subject to Federal income taxes to the extent that, among other
things, they distribute substantially all of their taxable income, including
realized capital gains, for the fiscal year. In addition, as a result of
distributing substantially all of their net investment income during each
calendar year, capital gains and certain other amounts, if any, the Funds would
not be subject to a Federal excise tax.
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 book/tax differences are either temporary
or permanent in nature. Any permanent differences, which may result in
distribution reclassifications, are primarily due to differing treatments for
gains resulting from redemptions in-kind, paydown gains and losses, investments
in passive foreign investment companies, reclassifications of long-term capital
gain distributions on real estate investment trust securities, partnership and
swap investments, net operating losses and foreign currency transactions.
Distributions from short-term gains and from gains on foreign currency
transactions are treated as distributions from ordinary income for tax purposes.
At October 31, 2007, the Funds reclassified the following permanent amounts
between paid-in capital, undistributed net investment income and accumulated
realized gain (loss):
INCREASE (DECREASE) INCREASE (DECREASE)
INCREASE UNDISTRIBUTED NET ACCUMULATED
PAID-IN CAPITAL INVESTMENT INCOME REALIZED GAIN (LOSS)
--------------- ------------------- --------------------
Schroder North American Equity Fund ..................... $60,232,562 $ 98,635 $(60,331,197)
Schroder International Diversified Value Fund ........... -- 119,147 (119,147)
Schroder U.S. Opportunities Fund ........................ -- 95,096 (95,096)
Schroder U.S. Small and Mid Cap Opportunities Fund ...... -- 18,137 (18,137)
Schroder International Alpha Fund ....................... -- 327,719 (327,719)
Schroder Emerging Market Equity Fund .................... -- (6,811) 6,811
Schroder Strategic Bond Fund ............................ -- 85,399 (85,399)
Schroder Total Return Fixed Income Fund ................. -- 15,530 (15,530)
These reclassifications had no impact on the net assets of the Funds and are
presented to show each Funds capital accounts reflecting permanent book-tax
differences.
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
The tax character of dividends and distributions declared during the years or
periods ended October 31, 2007 and October 31, 2006 was as follows:
ORDINARY TAX-EXEMPT LONG-TERM
INCOME INCOME CAPITAL GAIN TOTAL
------------ ------------ ------------ ------------
Schroder North American Equity Fund
2007 ..................................................... $ 42,947,662 $ -- $ 33,761,191 $ 76,708,853
2006 ..................................................... 20,622,879 -- 12,682,712 33,305,591
Schroder International Diversified Value Fund
2007 ..................................................... 172,530 -- -- 172,530
Schroder U.S. Opportunities Fund
2007 ..................................................... 7,344,179 -- 13,699,207 21,043,386
2006 ..................................................... -- -- 5,427,542 5,427,542
Schroder U.S. Small and Mid Cap Opportunities Fund
2007 ..................................................... 3,936 -- -- 3,936
Schroder International Alpha Fund
2007 ..................................................... 461,687 -- -- 461,687
2006 ..................................................... 128,898 -- -- 128,898
Schroder Emerging Market Equity Fund
2007 ..................................................... 63,167 -- -- 63,167
Schroder Enhanced Income Fund
2007 ..................................................... 6,096,452 -- -- 6,096,452
2006 ..................................................... 5,270,351 -- -- 5,270,351
Schroder Strategic Bond Fund
2007 ..................................................... 1,365,099 -- -- 1,365,099
2006* .................................................... 153,790 -- -- 153,790
Schroder Total Return Fixed Income Fund
2007 ..................................................... 1,986,596 -- -- 1,986,596
2006 ..................................................... 1,032,110 -- -- 1,032,110
Schroder Municipal Bond Fund
2007 ..................................................... 1,819,534 15,664,276 -- 17,483,810
2006 ..................................................... 877,054 5,918,223 -- 6,795,277
Schroder Short-Term Municipal Bond Fund
2007 ..................................................... 824,747 7,276,943 -- 8,101,690
2006 ..................................................... 937,871 4,695,148 -- 5,633,019
* Fund commenced investment activities on June 30, 2006.
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
As of October 31, 2007, the components of distributable earnings (accumulated
losses) on a tax basis were as follows:
TOTAL
DISTRIBUTABLE
UNDISTRIBUTED UNDISTRIBUTED UNDISTRIBUTED CAPITAL UNREALIZED OTHER EARNINGS
ORDINARY TAX-EXEMPT LONG-TERM LOSS APPRECIATION TEMPORARY (ACCUMULATED
INCOME INCOME CAPITAL GAIN CARRYFORWARD (DEPRECIATION) DIFFERENCES LOSSES)
------------- ------------- ------------- ------------ -------------- ----------- -------------
Schroder North American
Equity Fund ............. $ 25,590,182 $ -- $ 77,583,253 $ -- $ 113,287,297 $ (17,909) $ 216,442,823
Schroder International
Diversified Value Fund .. 1,776,785 -- 347,610 -- 1,613,821 (34,679) 3,703,537
Schroder U.S. Opportunities
Fund .................... 5,038,645 -- 22,629,488 -- 50,028,813 -- 77,696,946
Schroder U.S. Small and Mid
Cap Opportunities Fund .. 311,837 -- 386,237 -- 1,624,738 (15,555) 2,307,257
Schroder International
Alpha Fund .............. 958,594 -- -- (3,532,551) 6,910,114 -- 4,336,157
Schroder Emerging Market
Equity Fund ............. 2,275,244 -- 1,230,054 -- 8,712,143 (19,033) 12,198,408
Schroder Enhanced Income
Fund .................... 499,105 -- -- (1,384,706) (1,804,546) (550,907) (3,241,054)
Schroder Strategic Bond
Fund .................... 147,966 -- -- (162,490) 110,152 (143,131) (47,503)
Schroder Total Return
Fixed Income Fund ....... 356,622 -- 35,076 -- 130,821 (370,971) 151,548
Schroder Municipal Bond
Fund .................... 277,970 2,068,419 -- (275,052) (4,791,917) (2,311,860) (5,032,440)
Schroder Short-Term
Municipal Bond Fund ..... 113,954 735,051 -- (586,332) (1,347,161) (826,803) (1,911,291)
As of October 31, 2007, the Funds listed below had net tax basis capital loss
carryforwards, for Federal income tax purposes, that may be applied against
future taxable gains until their expiration date as follows:
EXPIRATION
DATES
AMOUNT OCTOBER 31,
----------- -----------
Schroder International Alpha Fund ................. $ 2,618,789 2010
913,762 2011
Schroder Enhanced Income Fund ..................... 7,778 2013
360,688 2014
1,016,240 2015
Schroder Strategic Bond Fund ...................... 142,853 2014
19,637 2015
Schroder Municipal Bond Fund ...................... 152,837 2012
99,808 2013
22,407 2015
Schroder Short-Term Municipal Bond Fund ........... 96,239 2012
234,915 2013
143,997 2014
111,181 2015
During the year ended October 31, 2007, capital loss carryforwards that were
utilized to offset gains were as follows:
AMOUNT
-----------
Schroder U.S. Small and Mid Cap Opportunities Fund ... $ 49,147
Schroder International Alpha Fund .................... 7,820,234
Schroder Emerging Market Equity Fund ................. 159,885
Schroder Total Return Fixed Income Fund .............. 162,689
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NOTES TO FINANCIAL STATEMENTS (CONTINUED)
OCTOBER 31, 2007
At October 31, 2007, the identified cost for Federal income tax purposes of
investments owned by each Fund and their respective gross unrealized
appreciation and depreciation were as follows:
GROSS UNREALIZED NET UNREALIZED
IDENTIFIED ------------------------------ APPRECIATION
TAX COST APPRECIATION (DEPRECIATION) (DEPRECIATION)
------------- ------------- -------------- --------------
Schroder North American Equity Fund ..................... $ 697,445,838 $ 140,612,601 $ (27,317,191) $ 113,295,410
Schroder International Diversified Value Fund ........... 12,552,081 2,175,378 (562,511) 1,612,867
Schroder U.S. Opportunities Fund ........................ 257,428,491 57,837,983 (7,809,170) 50,028,813
Schroder U.S. Small and Mid Cap Opportunities Fund ...... 9,985,264 1,754,593 (129,855) 1,624,738
Schroder International Alpha Fund ....................... 49,730,090 8,541,041 (1,637,114) 6,903,927
Schroder Emerging Markets Equity Fund ................... 21,635,881 8,861,778 (96,201) 8,765,577
Schroder Enhanced Income Fund ........................... 115,988,776 96,304 (1,900,850) (1,804,546)
Schroder Strategic Bond Fund ............................ 39,672,652 334,714 (248,463) 86,251
Schroder Total Return Fixed Income Fund ................. 76,510,568 346,776 (264,149) 82,627
Schroder Municipal Bond Fund ............................ 671,499,625 5,032,313 (9,824,230) (4,791,917)
Schroder Short-Term Municipal Bond Fund ................. 244,481,555 1,391,523 (2,738,684) (1,347,161)
NOTE 8 -- PORTFOLIO INVESTMENT RISKS
Schroder International Diversified Value, Schroder International Alpha, and
Schroder Emerging Market Equity Funds have a relatively large portion of their
assets invested in companies domiciled in particular foreign countries,
including emerging markets. The Funds may be more susceptible to political,
social and economic events adversely affecting those countries and such issuers.
Each of Schroder International Diversified Value, Schroder International Alpha,
Schroder Emerging Market Equity and Schroder Strategic Bond Funds may invest
more than 25% of its total assets in issuers located in any one country or group
of countries. To the extent that it does so, a Fund is susceptible to a range of
factors that could adversely affect its holdings in issuers of that country,
including political and economic developments and foreign exchange-rate
fluctuations. As a result of investing substantially in a single country, the
value of the Fund's assets may fluctuate more widely than the value of shares of
a comparable fund with a lesser degree of geographic concentration. The Funds
may invest in countries with limited or developing capital markets. Investments
in these markets may involve greater risk than investments in more developed
markets.
Each of Schroder Enhanced Income, Schroder Strategic Bond and Schroder Total
Return Fixed Income Funds invests a portion of their assets in securities of
issuers that hold mortgage securities, including subprime mortgage securities.
The value of these securities is sensitive to changes in economic conditions,
including delinquencies and/or defaults, and may be adversely affected by shifts
in the market's perception of the issuers and changes in interest rates.
Each of the Schroder Municipal Bond Fund and Schroder Short-Term Municipal Bond
Fund (together the "Municipal Bond Funds") invests a portion of its assets in
bonds that are insured by private insurers. The credit standing of such a bond
and/or its price will likely be affected by the credit standing of its insurer
and its ability to meet its obligations. Furthermore, the Municipal Bond Funds
may at times be invested in an issue of which the Funds by themselves or
together with other funds and accounts managed by the Funds' adviser or its
affiliates, holds all or a major portion. It is possible that, under adverse
market or economic conditions or in the event of adverse changes in the
financial condition of the issuer or its insurer, a Fund could find it more
difficult to sell these securities when the Funds' adviser believes it advisable
to do so or may be able to sell the securities only at prices lower than if they
were more widely held. Under these circumstances, it may also be more difficult
to determine the fair value of such securities for purposes of computing a
Fund's net asset value.
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NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
OCTOBER 31, 2007
NOTE 9 -- BENEFICIAL INTEREST
The following table shows the number of shareholders each owning of record, or
to the knowledge of the Funds beneficially, 5% or more of shares of a Fund
outstanding as of October 31, 2007 and the total percentage of shares of the
Fund held by such shareholders. The table includes omnibus accounts that hold
shares on behalf of several shareholders.
5% OR GREATER SHAREHOLDERS
--------------------------
NUMBER % OF FUND HELD
--------- --------------
Schroder North American Equity Fund ................... 6 73.81%
Schroder International Diversified Value Fund ......... 1 100.00
Schroder U.S. Opportunities Fund ...................... 3 74.40
Schroder U.S. Small and Mid Cap Opportunities Fund .... 3 97.65
Schroder International Alpha Fund ..................... 1 89.27
Schroder Emerging Market Equity Fund .................. 3 98.38
Schroder Enhanced Income Fund ......................... 1 97.12
Schroder Strategic Bond Fund .......................... 2 99.98
Schroder Total Return Fixed Income Fund ............... 2 95.60
Schroder Municipal Bond Fund .......................... 3 88.34
Schroder Short-Term Municipal Bond Fund ............... 3 90.94
Some of the accounts shown above for Schroder International Diversified Value,
Schroder U.S. Small and Mid Cap Opportunities, Schroder International Alpha,
Schroder Emerging Market Equity, Schroder Enhanced Income and Schroder Strategic
Bond Funds are owned by an affiliate of SIMNA.
NOTE 10 -- NEW ACCOUNTING PRONOUNCEMENTS
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 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. 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. Recent SEC
guidance allows implementing FIN 48 in fund asset calculations as late as the
fund's last net asset value calculation in the first required financial
statement reporting period following adoption. The Funds will not be required to
adopt FIN 48 until April 30, 2008. The Funds are currently evaluating the impact
that will result from adopting FIN 48 but do not anticipate a material impact to
the financial statements.
In September 2006, the FASB issued STATEMENT ON FINANCIAL ACCOUNTING STANDARDS
(SFAS) NO. 157, "FAIR VALUE MEASUREMENTS." This standard establishes a single
authoritative definition of fair value, sets out a framework for measuring fair
value and requires additional disclosures about fair value measurements. SFAS
No. 157 applies to fair value measurements already required or permitted by
existing standards. SFAS No. 157 is effective for financial statements issued
for fiscal years beginning after November 15, 2007 and interim periods within
those fiscal years. The changes to current generally accepted accounting
principles from the application of this Statement relate to the definition of
fair value, the methods used to measure fair value, and the expanded disclosures
about fair value measurements. As of October 31, 2007, the Funds do not believe
the adoption of SFAS No. 157 will impact the amounts reported in the financial
statements; however, additional disclosures may be required about the inputs
used to develop the measurements and the effect of certain of the measurements
reported on the statement of changes in net assets for a fiscal period.
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees and Shareholders of
Schroder Global Series Trust,
Schroder Capital Funds (Delaware) and
Schroder Series Trust
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Schroder North American Equity Fund
(constituting Schroder Global Series Trust), Schroder U.S. Opportunities Fund
and Schroder International Alpha Fund, (constituting Schroder Capital Funds
(Delaware)) and Schroder International Diversified Value Fund, Schroder U.S.
Small and Mid Cap Opportunities Fund, Schroder Emerging Market Equity Fund,
Schroder Enhanced Income Fund, Schroder Strategic Bond Fund, Schroder Total
Return Fixed Income Fund, Schroder Municipal Bond Fund, and Schroder Short-Term
Municipal Bond Fund (constituting Schroder Series Trust) (collectively referred
to as the "Funds") at October 31, 2007, the results of each of their operations
for the year then ended, the changes in each of their net assets for each of the
two years or periods in the period then ended and the financial highlights for
each of the years or periods presented, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at October 31, 2007 by correspondence with the
custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
December 21, 2007
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PROXY VOTING (UNAUDITED)
A description of the Funds' proxy voting policies and procedures is available
upon request, without charge, by visiting the SEC's web-site at
http://www.sec.gov, or by calling 1-800-464-3108 and requesting a copy of the
applicable Fund's Statement of Additional Information or on the Schroder Funds
website at http://www.schroderfunds.com, by downloading the Funds' Statement of
Additional Information. Information regarding how the Funds voted proxies
related to portfolio securities during the most recent 12-month period ended
June 30 is available without charge, upon request by calling 1-800-464-3108 and
on the SEC's website at http://www.sec.gov.
N-Q (UNAUDITED)
The Funds file their complete schedules of portfolio holdings with the SEC for
the first and third quarters of each fiscal year on Form N-Q. The Funds' Form
N-Q is available on the SEC's website at http://www.sec.gov, and may be reviewed
and copied at the SEC's Public Reference Room in Washington, DC. Information on
the operation of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
INFORMATION REGARDING REVIEW AND APPROVAL OF INVESTMENT ADVISORY CONTRACTS
(UNAUDITED)
RENEWAL OF INVESTMENT ADVISORY AGREEMENTS
The Funds' Advisory Agreements are subject to annual approval by the Trustees of
the Funds. The Trustees meet over the course of the year with investment
advisory personnel from Schroder Investment Management North America Inc.
("SIMNA") and regularly review detailed information regarding the investment
program and performance of each Fund. The Trustees met in June 2007 to consider
the continuation of the Advisory Agreement in respect of each of the Funds for
the following year. The Trustees considered a number of factors, none of which
alone they considered determinative. Factors considered by the Trustees included
those described below, among others.
The Trustees considered the fees charged by SIMNA to the Funds under the
Advisory Agreements and the fees payable by SIMNA to Schroder Investment
Management North America Limited ("SIMNA Ltd.") as sub-adviser to Schroder
International Alpha Fund, Schroder North American Equity Fund, Schroder Emerging
Market Equity Fund, Schroder Strategic Bond Fund, and Schroder International
Diversified Value Fund out of the fees received by SIMNA with respect to such
Funds. The Trustees also considered the expense ratio of each of the Funds. The
Trustees reviewed the information provided by SIMNA and compiled by the
independent Lipper Inc. ("Lipper") organization showing a comparison of SIMNA's
fee rate for each Fund (which included the administrative fee paid by Schroder
North American Equity Fund to Schroder Fund Advisors Inc.), as well as each
Fund's expense ratio, compared to peer mutual funds having similar objectives,
strategies, and asset sizes. The Trustees also considered information provided
by SIMNA with respect to the fees charged by SIMNA to clients other than the
Funds, including institutional separate accounts, offshore funds and mutual
funds for which SIMNA serves as sub-adviser.
The data showed that the advisory and administrative fee charged by SIMNA to the
Funds was within the range of comparable mutual funds, with several Funds below
the median for their respective peer groups (after giving effect to expense
limitations currently in effect and expected to be in effect for the upcoming
contractual year). Representatives of SIMNA reviewed with the Trustees the
reasons for higher non-management fee expenses charged to certain of the Funds
than the median of the funds in their respective peer groups, including the fact
that many of the Funds were smaller than other funds in their peer groups, so
fixed expenses, such as transfer agency expenses, were spread over a smaller
amount of assets, and the fact that some of the Funds had only recently been
launched and were relatively small.
The Trustees considered the fee waivers and/or expense limitations for the
Funds, including the time periods during which the fee waivers would be in place
and possible extensions of such fee waivers and/or expense limitations.
The Trustees also noted that in some cases the fee rate charged by SIMNA to
institutional separate accounts and certain other mutual funds sub-advised by
SIMNA was lower than that of the comparable Fund. Representatives of management
reviewed with the Trustees the reasons for the differences between the fees
charged to the Funds and to those accounts citing, among other things, greater
compliance, reporting, legal, and other administrative burdens of providing
investment advice to U.S.-registered mutual funds, the substantially greater
regulatory and enterprise risk to SIMNA in managing public mutual funds, and the
fact that the services and resources required of SIMNA when it sub-advises funds
sponsored by others are substantially less than in the case of the Funds.
The Trustees considered the profitability analysis with respect to each Fund for
the years ended December 31, 2005 and December 31, 2006. This information showed
the substantial costs to SIMNA of providing services to the Funds, and indicated
that SIMNA had a net loss with respect to all of the Funds, except Schroder U.S.
Opportunities Fund, for the calendar years ended December 31,
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INFORMATION REGARDING REVIEW AND APPROVAL OF INVESTMENT ADVISORY CONTRACTS
(UNAUDITED) (CONCLUDED)
2005 and December 31, 2006. The Trustees considered that SIMNA's net loss from
managing the Funds had decreased between 2005 and 2006, and the Trustees
concluded that the profitability of Schroder U.S. Opportunities Fund to SIMNA
did not appear unreasonable in light of the performance of the Fund and the
firm's long-term commitment to the Fund.
The Trustees considered whether economies of scale would likely be realized as
the Funds grow and whether a reduction in the advisory fees paid by the Funds by
means of breakpoints would be appropriate. They concluded that it did not appear
necessary at this point for new breakpoints to be implemented, although they
would continue to consider the matter in the future as the Funds grow. SIMNA
noted that, at this time, any increased profit realized by the firm as the Funds
grow enables it to devote greater resources to the management of the Funds, as
well as to provide financial incentives for the portfolio managers, analysts,
and other personnel who in many cases have alternative employment and business
opportunities available to them. In addition, representatives of SIMNA noted
that most of the Funds were small and, in their view, competitively priced, and
that SIMNA believed that where it is recognizing profit from a product, the
level of profitability is not excessive.
The Trustees reviewed detailed performance information for each Fund for various
periods. The review included an examination of comparisons of the performance of
the Funds to relevant securities indexes, other open-end mutual funds advised by
SIMNA, and various peer groups of mutual funds prepared by the independent
Lipper organization with respect to various periods, including the relative
rankings of the Funds compared to peer funds during various periods. The
Trustees considered that none of the Funds was shown in that data to have
substantially lagged the peer mutual funds and indexes for all relevant periods.
The Trustees further considered that a number of the Funds enjoyed favorable
absolute and comparative performance for various periods. The Trustees noted
that Schroder Strategic Bond Fund had not performed well relative to its Lipper
peer group, but that it had only a relatively limited operating history.
The Trustees considered the nature, extent, and quality of the services provided
by SIMNA and the non-advisory services provided by affiliates of SIMNA. In this
regard, the Trustees took into account the experience of the Funds' portfolio
management teams and of SIMNA's senior management, and the time and attention
devoted by each to the Funds.
After considering all the information described above, the Trustees at the
meeting unanimously voted to approve the continuation of the Advisory Agreements
in respect of each of the Funds, including the advisory fees proposed in
connection with that continuation.
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DISCLOSURE OF FUND EXPENSES (UNAUDITED)
We believe it is important for you to understand the impact of fees regarding
your investment. All mutual funds have operating expenses. As a shareholder of
the Fund, you incur ongoing costs, which include, among others, costs for
portfolio management, administrative services, and shareholder reports (like
this one), and in the case of Advisor Shares, distribution (12b-1) fees.
Operating expenses, which are deducted from a fund's gross income, directly
reduce the investment return of the fund. A fund's expenses are expressed as a
percentage of its average net assets. This figure is known as the expense ratio.
The following examples are intended to help you understand the ongoing costs (in
dollars) of investing in your Fund and to compare these costs with those of
other mutual funds. The examples are based on an investment of $1,000 made at
the beginning of the period shown and held for the entire period.
The table below illustrates your Fund's costs in two ways.
o ACTUAL EXPENSES. This section helps you to estimate the actual expenses after
fee waivers that you paid over the period. The "Ending Account Value" shown
is derived from the Fund's actual return, and the fourth column shows the
dollar amount that would have been paid by an investor who started with
$1,000 in the Fund. You may use the information here, together with the
amount you invested, to estimate the expenses that you paid over the period.
To do so, 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 given for your Fund under the heading "Expenses Paid During Period."
o HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. This section is intended to
help you compare your Fund's costs with those of other mutual funds. It
assumes that the Fund had a return of 5% before expenses during the year, and
that it incurred expenses at the rate of which it in the past did incur
expenses. In this case, because the return used is not the Fund's actual
return, the results may not be used to estimate the actual ending balance of
an account in the Fund over the period or expenses you actually paid. The
example is useful in making comparisons because the Securities and Exchange
Commission requires all mutual funds to calculate expenses in this table
based on a 5% return. You can assess your Fund's costs by comparing this
hypothetical example with the hypothetical examples that appear in
shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight and help
you compare ongoing costs only and do not reflect any transactional costs such
as redemption fees, which are described in the Prospectus. If this fee were
applied to your account, your costs would be higher.
Beginning Ending Net Expenses
Account Account Annualized Paid
Value Value Expense During
5/1/07 10/31/07 Ratios Period*
- ----------------------------------------------------------------------------------------------------------
Schroder North American Equity Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,065.43 0.33% $1.72
Advisor Shares 1,000.00 1,063.10 0.68 3.54
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,023.54 0.33% $1.68
Advisor Shares 1,000.00 1,021.78 0.68 3.47
- ----------------------------------------------------------------------------------------------------------
Schroder International Diversified Value Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,092.00 1.25% $6.59
Advisor Shares 1,000.00 1,090.50 1.50 7.90
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,018.90 1.25% $6.36
Advisor Shares 1,000.00 1,017.64 1.50 7.63
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DISCLOSURE OF FUND EXPENSES (UNAUDITED)
Beginning Ending Net Expenses
Account Account Annualized Paid
Value Value Expense During
5/1/07 10/31/07 Ratios Period*
- ----------------------------------------------------------------------------------------------------------
Schroder U.S. Opportunities Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,081.30 1.25% $ 6.56
Advisor Shares 1,000.00 1,080.20 1.50 7.86
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,018.90 1.25% $ 6.36
Advisor Shares 1,000.00 1,017.64 1.50 7.63
- ----------------------------------------------------------------------------------------------------------
Schroder U.S. Small and Mid Cap Opportunities Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,105.60 1.40% $ 7.43
Advisor Shares 1,000.00 1,104.00 1.65 8.75
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,018.15 1.40% $ 7.12
Advisor Shares 1,000.00 1,016.89 1.65 8.39
- ----------------------------------------------------------------------------------------------------------
Schroder International Alpha Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,131.30 1.25% $ 6.72
Advisor Shares 1,000.00 1,128.90 1.50 8.05
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,018.90 1.25% $ 6.36
Advisor Shares 1,000.00 1,017.64 1.50 7.63
- ----------------------------------------------------------------------------------------------------------
Schroder Emerging Market Equity Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,442.00 1.75% $10.77
Advisor Shares 1,000.00 1,440.30 2.00 12.30
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,016.38 1.75% $ 8.89
Advisor Shares 1,000.00 1,015.12 2.00 10.16
- ----------------------------------------------------------------------------------------------------------
Schroder Enhanced Income Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,011.70 0.40% $ 2.03
Advisor Shares 1,000.00 1,010.40 0.65 3.29
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,023.19 0.40% $ 2.04
Advisor Shares 1,000.00 1,021.93 0.65 3.31
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DISCLOSURE OF FUND EXPENSES (UNAUDITED)
Beginning Ending Net Expenses
Account Account Annualized Paid
Value Value Expense During
5/1/07 10/31/07 Ratios Period*
- ----------------------------------------------------------------------------------------------------------
Schroder Strategic Bond Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,009.40 1.15% $5.82
Advisor Shares 1,000.00 1,008.10 1.40 7.09
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,019.41 1.15% $5.85
Advisor Shares 1,000.00 1,018.15 1.40 7.12
- ----------------------------------------------------------------------------------------------------------
Schroder Total Return Fixed Income Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,020.10 0.40% $2.04
Advisor Shares 1,000.00 1,017.80 0.65 3.31
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,023.19 0.40% $2.04
Advisor Shares 1,000.00 1,021.93 0.65 3.31
- ----------------------------------------------------------------------------------------------------------
Schroder Municipal Bond Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,007.30 0.55% $2.78
Advisor Shares 1,000.00 1,006.10 0.80 4.05
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,022.43 0.55% $2.80
Advisor Shares 1,000.00 1,021.17 0.80 4.08
- ----------------------------------------------------------------------------------------------------------
Schroder Short-Term Municipal Bond Fund
- ----------------------------------------------------------------------------------------------------------
Actual Expenses
Investor Shares $1,000.00 $1,011.70 0.55% $2.79
Advisor Shares 1,000.00 1,010.40 0.80 4.05
Hypothetical Example for
Comparison Purposes
Investor Shares $1,000.00 $1,022.43 0.55% $2.80
Advisor Shares 1,000.00 1,021.17 0.80 4.08
* Expenses are equal to the Fund's annualized expense ratio multiplied by
the average account value over the account period, multiplied by 184/365
(to reflect the one-half year period).
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TRUSTEES AND OFFICERS (UNAUDITED)
Additional information regarding the Trustees is included in the Funds'
Statement of Additional Information, which is available free of charge by
calling (800) 464-3108.
TERM OF
OFFICE
AND
POSITION(S) LENGTH
NAME, AGE HELD WITH THE OF TIME
AND ADDRESS TRUSTS SERVED
- -----------------------------------------------------------------------------------------------------------------------
TRUSTEES^
Peter E. Guernsey*+, 86 Trustee Indefinite
875 Third Avenue, 22nd Fl. (All Trusts) Since 1975 (SCF(D))
New York, NY 10022 Since 1993 (SST)
Since 2006 (SGST)
Peter S. Knight*, 56 Trustee Indefinite
875 Third Avenue, 22nd Fl. (All Trusts) Since 1993 (SCF(D) and SST)
New York, NY 10022 Since 2003 (SGST)
Catherine A. Mazza++, 47 Trustee and Indefinite
875 Third Avenue, 22nd Fl. Chairman Since 2003 (SGST)
New York, NY 10022 (All Trusts) Since 2006 (SCF(D) and SST)
William L. Means*, 71 Trustee Indefinite
875 Third Avenue, 22nd Fl. (All Trusts) Since 1997 (SCF(D) and SST)
New York, NY 10022 Since 2006 (SGST)
James D. Vaughn*, 62 Trustee Indefinite
875 Third Avenue, 22nd Fl. (All Trusts) Since 2003
New York, NY 10022
- ----------
* Also serves as a member of the Audit Committees for each Trust on which
they serve.
+ Mr. Guernsey passed away in August, 2007.
++ Trustee deemed to be an "interested person" of the Trusts as defined in
the 1940 Act are referred to as an "Interested Trustee." Ms. Mazza is an
Interested Trustee due to her status as an officer and employee of
Schroder Investment Management North America Inc., the Trust's investment
advisor and its affiliates. Effective November 1, 2006, upon the
resignation of Mr. Peter L. Clark, Ms. Mazza became a Trustee and Chairman
of SCF(D) and SST, (she was already a Trustee of SGST).
^ Effective November 1, 2006, Messrs. David N. Dinkins, John I. Howell,
Clarence F. Michalis and Herman C. Schwab became Trustees Emeriti of
certain of the Trusts.
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NUMBER OF SERIES OTHER
PRINCIPAL IN FUND COMPLEX DIRECTORSHIPS
NAME, AGE OCCUPATION(S) OVERSEEN BY HELD BY
AND ADDRESS DURING PAST 5 YEARS BOARD MEMBER(a) BOARD MEMBER
- --------------------------------------------------------------------------------------------------------------------------
TRUSTEES^
Peter E. Guernsey*+, 86 Retired. Formerly, Senior Vice President, 11 None
875 Third Avenue, 22nd Fl. Marsh & McLennan, Inc. (Insurance Services)
New York, NY 10022
Peter S. Knight*, 56 Director, Schroder Japanese Long/Short Fund; 11 Medicis; PAR Pharmaceuticals;
875 Third Avenue, 22nd Fl. Director, Schroder Credit Renaissance Fund, LP; Entremed; Generation Investment
New York, NY 10022 Director, Schroder Alternative Strategies Fund; Management Global Equity Fund LLP.
President, Generation Investment Management
U.S. Formerly, Managing Director, MetWest
Financial (Financial Services); President of Sage
Venture Partners (Industry); Partner, Wunder,
Knight Forcsey & DeVierno (law firm).
Catherine A. Mazza++, 47 Senior Vice President Schroder Investment 11 None
875 Third Avenue, 22nd Fl. Management North American Inc., President
New York, NY 10022 and Director, Schroder Fund Advisors Inc.,
Formerly, President and Chief Executive
Officer of Schroder Capital Funds (Delaware)
and Schroder Series Trust.
William L. Means*, 71 Retired 11 None
875 Third Avenue, 22nd Fl.
New York, NY 10022
James D. Vaughn*, 62 Retired. Formerly, Managing Partner, 11 AMG National Trust Bank.
875 Third Avenue, 22nd Fl. Deloitte & Touche USA, LLP --
New York, NY 10022 Denver (accounting).
- ----------
(a) The "Fund Complex" includes all series of Schroder Capital Funds
(Delaware), Schroder Series Trust and Schroder Global Series Trust.
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125
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SCHRODER MUTUAL FUNDS
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TRUSTEES AND OFFICERS (UNAUDITED)
TERM OF
OFFICE
AND
POSITION(S) LENGTH
NAME, AGE HELD WITH THE OF TIME
AND ADDRESS TRUSTS SERVED
- -----------------------------------------------------------------------------------------------------------------------
OFFICERS
Mark A. Hemenetz, 52 President and Indefinite
875 Third Avenue, 22nd Fl. Principal Executive Officer Since May 2004
New York, NY 10022
Alan M. Mandel, 50 Treasurer and Principal Financial Indefinite
875 Third Avenue, 22nd Fl. and Accounting Officer Since 1998 (SST and SCF(D);
New York, NY 10022 Since 2003 (SGST)
Stephen M. DeTore, 56 Chief Compliance Officer Indefinite
875 Third Avenue, 22nd Fl. Since 2005
New York, NY 10022
Carin F. Muhlbaum, 45 Vice President Indefinite
875 Third Avenue, 22nd Fl. Vice President since 1998 (SST and (SCF(D);
New York, NY 10022 Secretary since 2001 (SST);
Vice President and Clerk since 2003 (SGST)
Abby Ingber, 44 Chief Legal Officer Indefinite
875 Third Avenue, 22nd Fl. and Secretary/Clerk Chief Legal Officer since 2006
New York, NY 10022 Secretary/Clerk since 2007
Angel Lanier, 46 Assistant Secretary Indefinite
875 Third Avenue, 22nd Fl. Since 2005
New York, NY 10022
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126
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SCHRODER MUTUAL FUNDS
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PRINCIPAL
NAME, AGE OCCUPATION(S)
AND ADDRESS DURING PAST 5 YEARS
- --------------------------------------------------------------------------------
OFFICERS
Mark A. Hemenetz, 52 Chief Operating Officer Americas,
875 Third Avenue, 22nd Fl. Schroder Investment Management North
New York, NY 10022 America Inc. ("Schroders"); Chairman
and Director, Schroder Fund Advisors Inc.
Formerly, Executive Vice President and
Director of Investment Management, Bank
of New York.
Alan M. Mandel, 50 Head of Fund Administration, Schroders;
875 Third Avenue, 22nd Fl. Director, Schroder Fund Advisors, Inc.
New York, NY 10022
Stephen M. DeTore, 56 Chief Compliance Officer, Schroders; Senior Vice
875 Third Avenue, 22nd Fl. President and Director, Schroder Fund Advisors Inc.
New York, NY 10022 Formerly, Deputy General Counsel, Gabelli Asset
Management, Inc.; Associate General Counsel
Gabelli Asset Management, Inc.; Assistant
Director, Office of Examination Support, U.S.
Securities and Exchange Commission.
Carin F. Muhlbaum, 45 General Counsel, and Chief Administrative Officer,
875 Third Avenue, 22nd Fl. Schroders; Senior Vice President, Director,
New York, NY 10022 Secretary and General Counsel, Schroder Fund
Advisors Inc.
Abby Ingber, 44 Deputy General Counsel, Schroders, formerly,
875 Third Avenue, 22nd Fl. Senior Counsel, TIAA-CREF.
New York, NY 10022
Angel Lanier, 46 Legal Assistant, Schroders; Assistant Vice President,
875 Third Avenue, 22nd Fl. Schroder Fund Advisors Inc. Formerly, Associate,
New York, NY 10022 Schroders.
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127
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SCHRODER MUTUAL FUNDS
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NOTICE TO SHAREHOLDERS (UNAUDITED)
For shareholders that do not have an October 31, 2007 tax year end, this notice
is for informational purposes only. For shareholders with an October 31, 2007
tax year end, please consult your tax advisor as to the pertinence of this
notice. For the fiscal year ended October 31, 2007, each Fund has designated the
following items with regard to distributions paid during the year.
LONG TERM QUALIFYING
(15% RATE) ORDINARY FOR CORPORATE
CAPITAL GAIN INCOME TAX-EXEMPT TOTAL DIVIDENDS REC.
FUND DISTRIBUTION DISTRIBUTIONS INTEREST DISTRIBUTIONS DEDUCTIONS (1)
- ----- ------------ ------------- ---------- ------------- --------------
Schroder North American
Equity Fund ........................... 44.01% 55.99% 0.00% 100.00% 53.47%
Schroder International
Diversified Value Fund (a) ............ 0.00% 100.00% 0.00% 100.00% 0.00%
Schroder U.S. Opportunities
Fund .................................. 65.10% 34.90% 0.00% 100.00% 12.12%
Schroder U.S. Small and Mid
Cap Opportunities Fund ................ 0.00% 100.00% 0.00% 100.00% 99.11%
Schroder International Alpha
Fund (b) .............................. 0.00% 100.00% 0.00% 100.00% 0.00%
Schroder Emerging Market
Equity Fund (c) ....................... 0.00% 100.00% 0.00% 100.00% 0.00%
Schroder Enhanced
Income Fund ........................... 0.00% 100.00% 0.00% 100.00% 0.00%
Schroder Strategic Bond
Fund .................................. 0.00% 100.00% 0.00% 100.00% 0.00%
Schroder Total Return Fixed
Income Fund ........................... 0.00% 100.00% 0.00% 100.00% 0.00%
Schroder Municipal
Bond Fund ............................. 0.00% 10.41% 89.59% 100.00% 0.00%
Schroder Short-Term
Municipal Bond Fund ................... 0.00% 10.18% 89.82% 100.00% 0.00%
QUALIFYING U.S. QUALIFYING QUALIFYING
DIVIDEND GOVERNMENT INTEREST SHORT-TERM
FUND INCOME (2) INTEREST (3) INCOME (4) CAPITAL GAIN (5)
- ----- ---------- ------------ ---------- ----------------
Schroder North American
Equity Fund ........................... 57.26% 0.00% 0.71% 100.00%
Schroder International
Diversified Value Fund (a) ............ 21.50% 0.00% 4.86% 100.00%
Schroder U.S. Opportunities
Fund .................................. 12.12% 0.00% 2.49% 100.00%
Schroder U.S. Small and Mid
Cap Opportunities Fund ................ 99.11% 0.00% 0.47% 0.00%
Schroder International Alpha
Fund (b) .............................. 84.62% 0.00% 2.30% 0.00%
Schroder Emerging Market
Equity Fund (c) ....................... 68.97% 0.00% 0.44% 0.00%
Schroder Enhanced
Income Fund ........................... 0.00% 0.52% 100.00% 0.00%
Schroder Strategic Bond
Fund .................................. 0.00% 0.00% 100.00% 0.00%
Schroder Total Return Fixed
Income Fund ........................... 0.00% 19.05% 100.00% 0.00%
Schroder Municipal
Bond Fund ............................. 0.00% 0.00% 0.00% 0.00%
Schroder Short-Term
Municipal Bond Fund ................... 0.00% 0.00% 0.00% 0.00%
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction and is reflected as a percentage of "Ordinary
Income Distributions."
(2) The percentage in this column represents the amount of "Qualifying
Dividend Income" as created by the Jobs and Growth Tax Relief
Reconciliation Act of 2003 and is reflected as a percentage of "Ordinary
Income Distributions." It is the intention of each of the aforementioned
funds to designate the maximum amount permitted by law.
(3) "U.S. Government Interest" represents the amount of interest that was
derived from direct U.S. Government Obligations and distributed during the
fiscal year. This amount is reflected as a percentage of total ordinary
income distributions (the total of short-term capital gain and net
investment income distributions). Generally, interest from direct U.S.
Government Obligations is exempt from state income tax.
(4) The percentage in this column represents the amount of "Qualifying
Interest Income" as created by the American Jobs Creation Act of 2004 and
is reflected as a percentage of net investment income distributions that
are exempt from U.S. withholding tax when paid by foreign investors.
(5) The percentage in this column represents the amount of "Qualifying
Short-Term Capital Gain" as created by the American Jobs Creation Act of
2004 and is reflected as a percentage of short-term capital gain
distributions that are exempt from U.S. withholding tax when paid by
foreign investors.
(a) The Fund intends to pass through a foreign tax credit to shareholders. For
fiscal year ended 2007, the total amount of foreign source income is
$561,490. The total amount of foreign tax to be paid is $52,461. Your
allocable share of the foreign tax credit will be reported on Form 1099
DIV.
(b) The Fund intends to pass through a foreign tax credit to shareholders. For
fiscal year ended 2007, the total amount of foreign source income is
$1,242,919. The total amount of foreign tax to be paid is $86,602. Your
allocable share of the foreign tax credit will be reported on Form 1099
DIV.
(c) The Fund intends to pass through a foreign tax credit to shareholders. For
fiscal year ended 2007, the total amount of foreign source income is
$411,657. The total amount of foreign tax to be paid is $29,748. Your
allocable share of the foreign tax credit will be reported on Form 1099
DIV.
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128
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SCHRODER MUTUAL FUNDS
- --------------------------------------------------------------------------------
NOTICE TO SHAREHOLDERS (UNAUDITED) (CONCLUDED)
On December 14, 2007 the Funds made the following per share distributions to the
shareholders of record as of December 13, 2007:
NET
INVESTMENT SHORT-TERM LONG-TERM
INCOME CAPITAL GAIN CAPITAL GAIN
---------- ------------ ------------
Schroder North American Equity Fund
Investor Share ................................................. $ 0.2835 $ 0.2007 $ 1.3102
Advisor Shares ................................................. 0.2422 0.2007 1.3102
Schroder International Diversified Value Fund
Investor Shares ................................................ 0.5879 1.1480 0.3352
Advisor Shares ................................................. 0.5604 1.1480 0.3352
Schroder U.S. Opportunities Fund
Investor Shares ................................................ 0.0305 0.3936 1.9017
Advisor Shares ................................................. -- 0.3936 1.9017
Schroder U.S. Small and Mid Cap Opportunities Fund
Investor Shares ................................................ -- 0.3371 0.4175
Advisor Shares ................................................. -- 0.3371 0.4175
Schroder International Alpha Fund
Investor Shares ................................................ 0.2379 -- --
Advisor Shares ................................................. 0.2141 -- --
Schroder Emerging Market Equity Fund
Investor Shares ................................................ 0.1374 1.2161 0.7306
Advisor Shares ................................................. 0.1099 1.2161 0.7306
Schroder Strategic Bond Fund*
Investor Shares ................................................ 0.1010 -- --
Advisor Shares ................................................. 0.0952 -- --
* The Strategic Bond Fund made a distribution on December 19, 2007 to the
shareholders of record as of December 18, 2007.
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129
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NOTES
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- --------------------------------------------------------------------------------
NOTES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PRIVACY STATEMENT
- --------------------------------------------------------------------------------
In the course of doing business with Schroders and the Schroder Mutual Funds,
you share nonpublic personal and financial information ("nonpublic personal
information") with us. Schroders respects your right to privacy. We understand
that you have entrusted us with this private information and we recognize the
importance of protecting unnecessary or unauthorized access to it.
I. INFORMATION THAT WE COLLECT
We may collect nonpublic personal information about you when you communicate or
transact business with us or with our service providers in writing,
electronically, or by telephone. For example, we collect nonpublic personal
information (such as name, address, account and other investment information)
about you from the following sources:
o Applications or forms completed by you; and
o Your transactions and account positions with us, our affiliates, or others
(including, for example, your own broker or custodian).
II. INFORMATION THAT WE DISCLOSE
We do not sell or rent your nonpublic personal information to any third parties.
We may disclose your nonpublic personal information to third parties in the
following limited circumstances:
o We may disclose some or all of your nonpublic personal information to
companies that help us maintain, process or service your transactions or
account(s) or financial products or services effected by or through us,
including companies that perform administrative, accounting, transfer
agency, custodial, brokerage or proxy solicitation services for us.
o We may disclose some or all of your nonpublic personal information, such
as account and transaction data, to companies which assist us in marketing
or client servicing. These companies will use this information only for
the services for which we hired them, are not permitted to use or share
this information for any other purpose and are required to protect the
confidentiality and security of this information.
o We may disclose or report some or all of your nonpublic personal
information if you request or authorize us to do so, for institutional
risk control, or in other circumstances where we believe in good faith
that disclosure is required or permitted under law.
III. OUR SECURITY PROCEDURES
We maintain physical, electronic, and procedural safeguards that comply with
federal standards to protect your nonpublic personal information. Within
Schroders, access to such information is limited to those employees who need it
to perform their jobs, such as servicing your accounts, resolving problems, or
informing you of new products or services. Finally, our Code of Ethics, which
applies to all employees, restricts the use of customer information and requires
that it be held in strict confidence.
We observe these policies with respect to current and former Schroders customers
and shareholders of the SchroderMutual Funds.
If you identify any inaccuracy in your personal information or you need to make
a change to that information, please contact us in writing so that we may
promptly update our records.
This Privacy Policy applies to the Schroder Mutual Funds,
Schroder Fund Advisors Inc. and Schroder Investment Management
North America Inc.
- --------------------------------------------------------------------------------
[LOGO] Schroders
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INVESTMENT ADVISOR Schroder Investment Management North America Inc.
875 Third Avenue, 22nd Floor
New York, NY 10022
TRUSTEES Catherine A. Mazza (CHAIRMAN)
David N. Dinkins*
John I. Howell*
Peter S. Knight
William L. Means
Clarence F. Michalis*
Hermann C. Schwab*
James D. Vaughn
*TRUSTEE EMERITUS
DISTRIBUTOR Schroder Fund Advisors Inc.
875 Third Avenue, 22nd Floor
New York, NY 10022
TRANSFER & SHAREHOLDER Boston Financial Data Services, Inc.
SERVICING AGENT
CUSTODIAN JP Morgan Chase Bank
COUNSEL Ropes & Gray LLP
INDEPENDENT REGISTERED PUBLIC PricewaterhouseCoopers LLP
ACCOUNTING FIRM
The information contained in this report is
intended for the general information of the
shareholders of the Trusts. This report is not
authorized for distribution to prospective
investors unless preceded or accompanied by a
current prospectus which contains important
information concerning the Trusts.
SCHRODER CAPITAL FUNDS (DELAWARE)
SCHRODER SERIES TRUST
SCHRODER GLOBAL SERIES TRUST
P.O. BOX 8507
BOSTON, MA 02266
(800) 464-3108
49458
[LOGO] Schroders
ITEM 2. CODE OF ETHICS.
The registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer and principal
accounting officer.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1) The registrant's board of trustees has determined that the registrant has
at least one audit committee financial expert serving on the audit committee.
(a)(2) The audit committee financial expert is James D. Vaughn. Mr. Vaughn is
independent as defined in Form N-CSR Item 3(a)(2).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Pricewaterhouse Coopers LLP billed the Trust aggregate fees for services
rendered to the Trust for the last two fiscal years as follows:
- ------------------ ----------------------------------------------------- -----------------------------------------------------
2007 2006
- ------------------ ----------------------------------------------------- -----------------------------------------------------
All fees and All fees and All other fees All fees and All fees and All other fees
services to the services to and services to services to the services to and services to
Trust that were service service Trust that were service service
pre-approved affiliates that affiliates that pre-approved affiliates that affiliates that
were did not require were did not require
pre-approved pre-approval pre-approved pre-approval
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(a) Audit $53,730 N/A $0 $51,170 N/A $0
Fees(1)
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(b) Audit- $0 $0 $ 308,032 (3) $0 $0 $333,880 (3)
Related
Fees
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(c) Tax $7,510 $0 $0 $7,145 $0 $0
Fees(2)
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
(d) All $0 $0 $0 $0 $0 $0
Other
Fees
- ------- ---------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------
Notes:
(1) Performance verification services rendered to Schroder Investment
Management North America, Inc. to ensure conformity with CFA Institute
performance standards.
(2) Tax return preparation fees.
(3) Performance verification services, FRAG 21 reporting and other
miscellaneous consulting services rendered to Schroder Investment
Management North America, Inc.
(e)(1) The Audit Committee pre-approves, to the extent required by applicable
regulations (including paragraph (c)(7) of Rule 2-01 of Regulation
S-X), (i) all audit and permitted non-audit services rendered by the
independent accountants to the registrant and (ii) all non-audit
services rendered by the independent accountants to the registrant's
investment adviser and to certain affiliates of the investment adviser.
(e)(2) Percentage of fees billed applicable to non-audit services pursuant to
waiver of pre-approval requirement were as follows:
---------------------------- ----------------- ----------------
2007 2006
---------------------------- ----------------- ----------------
Audit-Related Fees n/a n/a
---------------------------- ----------------- ----------------
Tax Fees 0% 0%
---------------------------- ----------------- ----------------
All Other Fees n/a n/a
---------------------------- ----------------- ----------------
(f) Not applicable.
(g) The aggregate non-audit fees and services billed by Pricewaterhouse Coopers
LLP for the last two fiscal years were $315,542 and $341,025 for 2007 and 2006,
respectively.
(h) Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to open-end management investment companies.
ITEM 6. SCHEDULE OF INVESTMENTS
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to open-end management investment companies.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT COMPANY AND
AFFILIATED PURCHASERS.
Not applicable to open-end management investment companies.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial officer
have concluded, based on their evaluation of the registrant's disclosure
controls and procedures as of a date within 90 days of the filing date of this
report on Form N-CSR, that the design and operation of such procedures are
effective to provide reasonable assurance that information required to be
disclosed by the investment company on Form N-CSR is recorded, processed,
summarized and reported within the time periods specified in the Commission's
rules and forms.
(b) There have been no changes in the registrant's internal control over
financial reporting during the period from August 1, 2007 through October 31,
2007 that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Code of Ethics attached hereto.
(a)(2) A separate certification for the principal executive officer and the
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed
herewith.
(b) Officer certifications as required by Rule 30a-2(b) under the Investment
Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing
as an Exhibit.
- --------------------------------------------------------------------------------
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) Schroder Capital Funds (Delaware)
By (Signature and Title)* /s/ Mark A. Hemenetz
--------------------
Mark A. Hemenetz
Principal Executive Officer
Date January 2, 2008
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/ Mark A. Hemenetz
--------------------
Mark A. Hemenetz
Principal Executive Officer
Date January 2, 2008
By (Signature and Title)* /s/ Alan M. Mandel
------------------
Alan M. Mandel,
Treasurer and Chief Financial Officer
Date January 2, 2008
* Print the name and title of each signing officer under his or her signature.