UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act File Number 811-21836
---------
Giant 5 Funds
(Exact name of registrant as specified in charter)
128 South Tejon, Suite 150
Colorado Springs, CO 80903
--------------------------
(Address of principal executive offices)
Michael G. Willis
The Willis Group
128 South Tejon, Suite 150
Colorado Springs, CO 80903
---------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (719) 884-7500
--------------
Date of fiscal year end: March 31
--------
Date of reporting period: September 30, 2007
------------------
Item 1. Reports to Stockholders
The following is a copy of the report transmitted to shareholders pursuant to
Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1).
GIANT 5 FUNDS
INVESTOR SHARES
SEMI-ANNUAL REPORT
SEPTEMBER 30, 2007
GIANT 5 TOTAL INVESTMENT SYSTEM (FIVEX)
25 UNDERLYING MUTUAL FUNDS
GIANT 5 TOTAL INDEX SYSTEM (INDEX)
25 UNDERLYING INDEX FUNDS AND ETFS
Invest in the Essentials
Invest for Life(TM)
[IMAGE]
Investors should carefully read and consider the Fund's investment objectives,
risks, charges and expenses before investing or sending money. This and other
important information is contained in the Prospectus, which can be obtained by
calling 1-888-5Giant5 (1-888-544-2685) or downloaded on www.Giant5.com. Funds
distributed by UMB Distribution Services, LLC.
<page>
Semi-Annual Report
Table of Contents September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
Letter to Shareholders.......................................................2
Giant 5 Total Investment System
Schedule of Portfolio Investments............................................3
Financial Statements.........................................................4
Financial Highlights.........................................................6
Giant 5 Total Index System
Schedule of Portfolio Investments............................................7
Financial Statements.........................................................8
Financial Highlights........................................................10
Notes to Financial Statements...............................................11
Supplemental Information....................................................17
<page>
[IMAGE]
Dear Shareholders,
With two more months left in the year, 2007 is already proving to be a
significant year for Giant 5 Funds and our shareholders. Shareholders have been
rewarded with solid performance as both Funds (FIVEX and INDEX) outperformed
their benchmark, the S&P 500, on a year-to-date basis (see chart below). We
believe that this is evidence that our Invest Where You Spend philosophy is more
relevant to investors than the traditional cap weighted asset allocation models
currently being used in the industry.
As life expectancy in the U.S. continues to climb, we think investors are taking
a closer look at what types of investments can keep up with their expenses. By
owning Real Estate, Raw Materials, Energy, Capital Markets, and Bonds, our
portfolios are designed to help investors keep pace with the things they buy
most.
For those of you who have not signed-up to view your statements online yet, we
have recently added this functionality to our website. I believe that you will
find these new features valuable. In addition, many of you have inquired about
receiving digital statements and eliminating most of the monthly paper you
receive. We have added this capability as well and hope that many of you will
take advantage of digital statements as it helps us reduce costs and save trees.
All of this can be done by visiting www.Giant5.com.
We believe these 5 Essential Themes; Real Estate, Energy, Raw Materials, Capital
Markets, and Bonds, make up the foundations of the global investment world and
should be held at all times. As most of you know, we offer this 5-Asset Strategy
in two no-load mutual funds. The Giant 5 Total Investment System (FIVEX) focuses
on the experience and talents of what we believe to be the best investment
managers in the world. The Giant 5 Total Index System (INDEX) focuses on the
efficiencies of indexes and Exchange Traded Funds.
I look forward to working for you next year.
Sincerely,
Michael G. Willis
President
During the six-month period ended September 30, 2007, Giant 5 Total Investment
System (FIVEX) returned +10.51% and Giant 5 Total Index System (INDEX) returned
+7.51%. During this same period our benchmark, the S&P 500 Index was +8.44%.
Performance Comparison Since Inception
As of September 30, 2007 YTD 1-Year (Annualized)*
- -----------------------------------------------------------------------------------------------------
Giant 5 Total Investment System (FIVEX) +15.48% +26.07% +15.71%
Giant 5 Total Index System (INDEX) +10.79% +19.18% +12.12%
S&P 500 Index +9.13% +16.44% +13.51%
Russell 2000(R) Index +3.16% +12.34% +5.02%
Dow Jones Industrial Average +13.31% +21.68% +17.90%
- -----------------------------------------------------------------------------------------------------
* Inception Date May 1, 2006
The performance data quoted here represents past performance and past
performance is not a guarantee of future results. Investment return and
principal value will fluctuate, so that an investor's shares, when redeemed, may
be worth more or less than their original cost. Current performance may be lower
or higher than the performance information quoted. To obtain performance
information current to the most recent month-end, please call 1-888-5GIANT5.
Gross expenses of the Total Investment System and Total Index System are 1.81%
and 1.79%, respectively. Gross expenses are reflective of the information
disclosed in the Funds' Prospectus dated July 2, 2007 and may differ from the
expense ratios disclosed in this report.
Equity securities are more volatile and carry more risk than other forms of
investment, including investments in high grade fixed income securities. Fixed
income securities are subject to interest rate risks. Investments concentrated
in one economic sector, such as, Energy, Raw Materials, and Real Estate,
experience greater volatility than more broadly based investments. International
investing is subject to greater volatility due to such factors as changes in
currency rates, foreign taxation, differences in auditing and other financial
standards, and political and economic instability.
[LOGO]
Giant 5 Total Investment System Fund
Schedule of Portfolio Investments September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
Security Description Shares Value
- --------------------------------------------------------------------------------
INVESTMENT COMPANIES - 99.3%
- --------------------------------------------------------------------------------
Alpine International Real
Estate Equity Fund, Class Y.. 10,970 $503,291
American Growth Fund of
America, Inc., Class Fund.... 9,394 350,127
BlackRock Global
Resources Fund, Class I...... 30,539 1,936,784
Columbia Mid Cap
Value Fund, Class Z.......... 18,932 291,743
Delaware American
Services Fund, Class I....... 58,538 1,181,874
E.I.I. International
Property Fund, Class I....... 113,924 2,783,164
Fidelity Select Industrials
Materials Portfolio.......... 38,930 2,332,667
Franklin Mutual
European Fund, Class Z....... 38,690 1,113,100
ICON Materials Fund............ 229,584 3,533,299
Ivy European
Opportunities Fund, Class Y.. 3,010 132,374
Ivy Global Natural
Resources Fund, Class Y...... 73,205 2,961,865
JPMorgan Small Cap
Equity Fund, Class S......... 30,728 1,084,092
Loomis Sayles Fixed
Income Fund, Class I......... 237,465 3,440,873
Loomis Sayles Small Cap
Value Fund, Class I.......... 3,862 111,150
Matthews China Fund............ 48,415 2,011,643
Shares or
Principal
Security Description Amount Value
- --------------------------------------------------------------------------------
INVESTMENT COMPANIES CONTINUED
- --------------------------------------------------------------------------------
Morgan Stanley Institutional
Fund, Inc., International Real
Estate Portfolio, Class A.... 7,096 $228,192
Morgan Stanley Institutional
Portfolio Fund, Inc., US Real
Estate Portfolio, Class A.... 100,027 2,665,723
Oppenheimer International
Bond Fund, Class Y........... 165,090 1,051,624
T. Rowe Price Latin
America Fund................. 3,272 173,685
U.S. Global Investors Accolade
Funds, Eastern European Fund. 4,404 243,167
Vanguard Energy Fund,
Admiral Shares............... 21,795 3,327,703
Vanguard Short-Term Investment
Grade Fund, Admiral Shares.. 178,445 1,889,732
Vanguard Windsor II Fund, Class Y 9,047 338,733
---------------
Total Investment Companies
(Cost $29,332,433)........... 33,686,605
---------------
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.5%
- --------------------------------------------------------------------------------
UMB Bank Money Market
Fiduciary, 3.176%, 10/1/2007. $155,466 $155,466
---------------
Total Short-Term Investments
(Cost $155,466).............. 155,466
---------------
Total Investments - 99.8%
(Cost $29,487,899)........... 33,842,071
Other Assets and Liabilities - 0.2% 72,813
---------------
NET ASSETS - 100.0%............ $33,914,884
===============
See notes to financial statements.
Giant 5 Total Investment System Fund
Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
Assets:
Total investment securities at market value
(cost $29,487,899)..................... $33,842,071
Cash...................................... --
Receivable for fund shares sold.......... 62,724
Receivable for investment securities sold. 111,479
Interest and dividends receivable........ 8,625
Prepaid assets........................... --
---------------
Total Assets........................... 34,024,899
---------------
Liabilities:
Payable to bank........................... --
Payable for investment securities purchased --
Payable for fund shares redeemed......... --
Payable to Investment Advisor............. 17,458
Payable for 12b-1 fees................... 4,534
Other payables........................... 88,023
---------------
Total Liabilities...................... 110,015
---------------
Total Net Assets.......................... $33,914,884
===============
Net assets consist of:
Paid-in capital........................... $28,347,462
Undistributed net investment income...... 10,615
Accumulated net realized gain............ 1,202,635
Net unrealized appreciation.............. 4,354,172
---------------
Total Net Assets......................... $33,914,884
===============
Capital Shares:
Outstanding (unlimited number
of shares authorized).................. 1,886,370
---------------
Net Asset Value Per Share................. $17.98
===============
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
Investment Income:
Dividends ................................ $269,636
Interest income........................... 20,809
---------------
Total investment income................. 290,445
---------------
Expenses:
Investment advisory fees.................. 106,253
Legal fees................................ 32,028
Fund administration fees.................. 28,860
12b-1 fees................................ 26,509
Transfer agent fees....................... 20,895
Custody fees.............................. 20,516
Blue Sky fees............................. 14,511
Miscellaneous fees........................ 14,073
Audit fees................................ 7,131
Insurance................................. 5,163
CCO fees.................................. 4,775
Directors fees............................ 3,000
Printing fees............................. 2,691
Pricing fees.............................. 1,069
SEC fees.................................. 126
---------------
Total Expenses.......................... 287,600
---------------
Deduct:
Waiver of operating expenses.............. (412)
---------------
Net Expenses.............................. 287,188
===============
Net Investment Income..................... 3,257
===============
Realized and Unrealized Gain on Investments
Net realized gain on investments.......... 548,164
Change in unrealized appreciation of
investments for the period.............. 2,618,117
---------------
Net realized and unrealized gain on investments 3,166,281
---------------
Change in net assets resulting from operations $3,169,538
===============
See notes to financial statements.
<page>
Financial Statements Giant 5 Total Investment System Fund
- -----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended
September 30, 2007 March 31, 2007(a)
(Unaudited)
- -----------------------------------------------------------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets from Operations
Net investment income............................................... $3,257 $444,131
Net realized gain from investment transactions...................... 548,164 900,567
Change in unrealized appreciation................................... 2,618,117 1,736,055
-----------------------------------------------------------
Change in net assets resulting from operations...................... 3,169,538 3,080,753
-----------------------------------------------------------
Distributions to Shareholders
Net investment income............................................... -- (461,110)
Net realized capital gains.......................................... -- (238,738)
Return of Capital................................................... -- --
-----------------------------------------------------------
Change in net assets resulting from distributions to shareholders... -- (699,848)
-----------------------------------------------------------
Capital Share Transactions
Proceeds from sale of shares........................................ 1,778,074 28,613,800
Distributions reinvested............................................ -- 699,848
Cost of shares redeemed............................................. (1,005,208) (1,724,228)
Redemption fees..................................................... 2,155 --
-----------------------------------------------------------
Change in net assets resulting from capital share transactions...... 775,021 27,589,420
-----------------------------------------------------------
Net increase in net assets.......................................... 3,944,559 29,970,325
-----------------------------------------------------------
Net Assets
Beginning of period................................................. 29,970,325 --
-----------------------------------------------------------
End of period....................................................... $33,914,884 $29,970,325
===========================================================
Undistributed net investment income at end of period................ $10,615 $ --
===========================================================
Share Information
Shares sold......................................................... 104,354 1,906,477
Distributions reinvested............................................ -- 44,948
Shares redeemed..................................................... (60,056) (109,353)
-----------------------------------------------------------
Net change resulting from share transactions........................ 44,298 1,842,072
===========================================================
- ------------------------------------------------------------
(a) Fund commenced operations on May 1, 2006.
See notes to financial statements.
<page>
<page>
Financial Highlights Giant 5 Total Investment System Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended
The table below sets forth financial data for a share September 30, 2007 Year Ended
outstanding in the Fund throughout each period presented: (Unaudited) March 31, 2007(a)
- ------------------------------------------------------------------------------------------------------------------------------------
Per share data:
Net Asset Value - Beginning of Period............................... $16.27 $15.00
-----------------------------------------------------------
Income from Investment Operations:
Net investment income............................................... 0.01 0.26
Net realized and unrealized gains on investments.................... 1.70 1.41
-----------------------------------------------------------
Total from investment operations.................................. 1.71 1.67
-----------------------------------------------------------
Less Distributions Declared to Shareholders:
Net investment income............................................... -- (0.26)
Net realized capital gains.......................................... -- (0.14)
Return of capital................................................... -- --
-----------------------------------------------------------
Total distributions............................................... -- (0.40)
-----------------------------------------------------------
Paid-in capital from redemption fees.............................. --(b) --(b)
Net Asset Value - End of Period..................................... $17.98 $16.27
===========================================================
Total Return........................................................ 10.51%(c) 11.27%(c)
Ratios (to average net assets) Supplemental Data:
Net assets at end of period (000s).................................. $33,915 $29,970
Expenses before waivers............................................. 1.81%(d) 1.91%(d)
Expenses after waivers.............................................. 1.81%(d)(e) N/A
Net investment income............................................... 0.02%(d) 1.96%(d)
Portfolio turnover.................................................. 14.02%(c) 22.20%(c)
- ----------------------------------------------------------------
(a) Fund commenced operations on May 1, 2006.
(b) Less than $0.005.
(c) Not annualized.
(d) Annualized.
(e) Effective July 1, 2007, the Fund is voluntarily capped at 1.35%.
See notes to financial statements
<page>
Giant 5 Total Index System Fund
Schedule of Portfolio Investments September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
Security Description Shares Value
- --------------------------------------------------------------------------------
EXCHANGE TRADED FUNDS - 99.6%
- --------------------------------------------------------------------------------
Ameristock/Ryan
1-Year Treasury ETF.......... 17,900 $459,672
Ameristock/Ryan
2-Year Treasury ETF.......... 17,900 447,142
DJ Wilshire REIT ETF........... 18,983 1,541,609
Energy Select Sector SPDR Fund. 11,133 834,975
iShares Cohen & Steers
Realty Majors Index Fund..... 11,314 1,054,804
iShares Dow Jones US Basic
Materials Sector Index Fund.. 10,776 798,717
iShares Lehman 1-3 Year
Treasury Bond Fund........... 27,000 2,194,020
iShares MSCI EAFE Index Fund... 1,739 143,624
iShares MSCI EMU Index Fund.... 1,760 212,520
iShares Russell 1000
Value Index Fund............. 4,719 405,598
iShares Russell Midcap
Value Index Fund............. 3,371 510,032
iShares S&P Europe 350
Index Fund................... 6,792 809,606
iShares S&P Global Energy
Sector Index Fund............ 21,395 2,953,366
PowerShares FTSE RAFI Basic
Materials Sector Portfolio... 7,900 533,013
PowerShares FTSE RAFI
Developed Markets
ex-U.S. Portfolio............ 5,000 254,900
PowerShares FTSE RAFI
Energy Sector Portfolio...... 10,240 746,394
PowerShares FTSE RAFI
U.S. 1000 Portfolio.......... 21,755 1,339,455
PowerShares FTSE RAFI U.S.
1500 Small-Mid Portfolio..... 12,070 682,196
Shares or
Principal
Security Description Amount Value
- --------------------------------------------------------------------------------
EXCHANGE TRADED FUNDS CONTINUED
- --------------------------------------------------------------------------------
PowerShares WilderHill
Clean Energy Portfolio....... 4,000 $91,560
SPDR DJ Wilshire
International Real
Estate ETF................... 26,500 1,702,625
SPDR Lehman
Aggregate Bond ETF........... 2,162 114,543
Vanguard Information
Technology Index ETF......... 10,000 606,500
Vanguard Long-Term
Bond ETF..................... 12,200 912,072
Vanguard Materials ETF......... 15,024 1,322,563
Vanguard Total Bond Market ETF. 23,000 1,740,640
WisdomTree International
Basic Materials Sector Fund*. 69,750 2,766,983
WisdomTree International
Energy Sector Fund........... 40,000 1,402,000
WisdomTree International
MidCap Dividend Fund......... 4,000 288,080
WisdomTree International
Real Estate Fund*............ 20,000 1,059,400
WisdomTree International
SmallCap Dividend Fund....... 3,500 244,580
---------------
Total Exchange Traded Funds
(Cost $26,010,622)........... 28,173,189
---------------
SHORT-TERM INVESTMENTS - 11.7%
UMB Bank Money Market
Fiduciary, 3.176%, 10/1/2007. $3,318,947 $3,318,947
---------------
Total Short-Term Investments
(Cost $3,318,947)............ 3,318,947
---------------
Total Investments - 111.3%
(Cost $29,329,569)........... 31,492,136
Other Assets and Liabilities - (11.3)% (3,209,646)
---------------
NET ASSETS - 100.0%............ $28,282,490
===============
- --------------------------------------------------------------------------------
* Non-income producing.
See notes to financial statements.
Giant 5 Total Index System Fund
Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
- --------------------------------------------------------------------------------
Assets:
Total investment securities at market value
(cost $29,329,569)..................... $31,492,136
Cash..................................... --
Receivable for fund shares sold.......... --
Receivable for investment securities sold. 794,135
Interest and dividends receivable........ 60,673
Prepaid assets........................... --
---------------
Total Assets........................... 32,346,944
---------------
Liabilities:
Payable to bank.......................... --
Payable for investment securities purchased 3,930,660
Payable for fund shares redeemed......... 58,589
Payable to Investment Advisor............ 14,758
Payable for 12b-1 fees................... 3,833
Other payables........................... 56,614
---------------
Total Liabilities...................... 4,064,454
---------------
Total Net Assets......................... $28,282,490
===============
Net assets consist of:
Paid-in capital.......................... $24,630,885
Undistributed net investment income...... 31,061
Accumulated net realized gain............ 1,457,977
Net unrealized appreciation.............. 2,162,567
---------------
Total Net Assets......................... $28,282,490
===============
Capital Shares:
Outstanding (unlimited number
of shares authorized).................. 1,619,499
---------------
Net Asset Value Per Share................. $17.46
===============
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------
Investment Income:
Dividends................................. $220,718
Interest income........................... 35,596
---------------
Total investment income................. 256,314
---------------
Expenses:
Investment advisory fees.................. 85,495
Legal fees................................ 25,152
Fund administration fees.................. 22,851
12b-1 fees................................ 21,693
Transfer agent fees....................... 17,577
Custody fees.............................. 14,196
Blue Sky fees............................. 11,369
Miscellaneous fees........................ 11,236
Audit fees................................ 5,669
Insurance................................. 4,072
CCO fees.................................. 3,975
Directors fees............................ 3,000
Printing fees............................. 2,363
Pricing fees.............................. 974
SEC fees.................................. 24
---------------
Total Expenses.......................... 229,646
---------------
Deduct:
Waiver of operating expenses.............. (348)
---------------
Net Expenses.............................. 229,298
===============
Net Investment Income..................... 27,016
Realized and Unrealized Gain on Investments
Net realized gain on investments.......... 1,460,436
Change in unrealized appreciation of
investments for the period.............. 313,291
---------------
Net realized and unrealized gain on investments 1,773,727
Change in net assets resulting from operations $1,800,743
===============
See notes to financial statements.
<page>
Financial Statements Giant 5 Total Index System Fund
- --------------------------------------------------------------------------------
Six Months Ended
September 30, 2007 Year Ended
(Unaudited) March 31, 2007(a)
- ------------------------------------------------------------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets from Operations
Net investment income............................................... $27,016 $182,607
Net realized gain from investment transactions...................... 1,460,436 22,417
Change in unrealized appreciation................................... 313,291 1,849,276
-----------------------------------------------------------
Change in net assets resulting from operations...................... 1,800,743 2,054,300
-----------------------------------------------------------
Distributions to Shareholders
Net investment income............................................... -- (216,286)
Net realized capital gains.......................................... -- (4,131)
Return of Capital................................................... -- (6,502)
-----------------------------------------------------------
Change in net assets resulting from distributions to shareholders... -- (226,919)
-----------------------------------------------------------
Capital Share Transactions
Proceeds from sale of shares........................................ 5,284,805 21,911,268
Distributions reinvested............................................ -- 226,919
Cost of shares redeemed............................................. (1,192,380) (1,577,170)
Redemption fees..................................................... 924 --
-----------------------------------------------------------
Change in net assets resulting from capital share transactions...... 4,093,349 20,561,017
-----------------------------------------------------------
Net increase in net assets.......................................... 5,894,092 22,388,398
-----------------------------------------------------------
Net Assets
Beginning of period................................................. 22,388,398 --
-----------------------------------------------------------
End of period....................................................... $28,282,490 $22,388,398
===========================================================
Undistributed net investment income at end of period................ $31,061 $ --
-----------------------------------------------------------
Share Information
Shares sold......................................................... 312,760 1,463,173
Distributions reinvested............................................ -- 14,398
Shares redeemed..................................................... (71,587) (99,246)
-----------------------------------------------------------
Net change resulting from share transactions........................ 241,173 1,378,326
===========================================================
- ------------------------------------------------------------------------------------------------------------------------------------
(a) Fund commenced operations on May 1, 2006.
See notes to financial statements.
<page>
Financial Highlights Giant 5 Total Index System Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended
The table below sets forth financial data for a share September 30, 2007 Year Ended
outstanding in the Fund throughout each period presented: (Unaudited) March 31, 2007(a)
- ------------------------------------------------------------------------------------------------------------------------------------
Per share data:
Net Asset Value - Beginning of Period............................... $16.24 $15.00
-----------------------------------------------------------
Income from Investment Operations:
Net investment income............................................... 0.02 0.15
Net realized and unrealized gains on investments.................... 1.20 1.25
-----------------------------------------------------------
Total from investment operations.................................. 1.22 1.40
-----------------------------------------------------------
Less Distributions Declared to Shareholders:
Net investment income............................................... -- (0.15)
Net realized capital gains.......................................... -- --(b)
Return of capital................................................... -- (0.01)
-----------------------------------------------------------
Total distributions............................................... -- (0.15)
-----------------------------------------------------------
Paid-in capital from redemption fees.............................. --(b) --(b)
Net Asset Value - End of Period..................................... $17.46 $16.24
===========================================================
Total Return........................................................ 7.51%(c) 9.38%
(c)
Ratios (to average net assets) Supplemental Data:
Net assets at end of period (000s).................................. $28,282 $22,388
Expenses before waivers............................................. 1.79%(d) 1.90%(d)
Expenses after waivers.............................................. 1.79%(d)(e) N/A
Net investment income............................................... 0.21%(d) 1.00%(d)
Portfolio turnover.................................................. 77.30%(c) 5.35%(c)
- ------------------------------------------------------------------------------------------------------------------------------------
(a) Fund commenced operations on May 1, 2006.
(b) Less than $0.005.
(c) Not annualized.
(d) Annualized.
(e) Effective July 1, 2007, the Fund is voluntarily capped at 1.35%.
See notes to financial statements.
<page>
Giant 5 Funds Investor Shares
Notes to Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
1. Organization
Giant 5 Funds (the "Trust") was organized as a trust under the laws of the
State of Delaware on November 9, 2005. The Trust is an open-end investment
company registered under the Investment Company Act of 1940, as amended
(the "1940 Act"). The Trust is authorized to issue an unlimited number of
shares, which are units of beneficial interest with no par value. The Trust
currently offers shares of two series, each of which has different and
distinct investment objectives and policies: the Giant 5 Total Investment
System and the Giant 5 Total Index System (Individually a "Fund",
collectively the "Funds"). Each of the Funds commenced operations on May 1,
2006.
The investment objective for each Fund is to seek total return. To pursue
its investment objective, the Giant 5 Total Investment System will make
investments primarily in other mutual funds that are not affiliated with
the Fund. To pursue its investment objective, the Giant 5 Total Index
System will primarily invest in unaffiliated index funds and exchange
traded funds.
Each Fund is non-diversified, as that term is defined in the 1940 Act, and
each Fund is a "fund of funds," which means that each Fund invests in other
mutual funds and exchange traded funds ("Underlying Funds"). As of
September 30, 2007, only Investor Shares have been offered and issued.
2. Significant Accounting Policies
The following is a summary of significant accounting policies followed by
the Trust in the preparation of its financial statements. These policies
are in conformity with accounting principles generally accepted in the
United States of America ("GAAP").
Security Valuation:
The value of assets in a Fund's portfolio is determined on the basis of
their market value, or where market quotations are not readily available or
are deemed unreliable due to a significant event or otherwise, based on
fair value as determined in good faith in accordance with the procedures
established by, and under the general supervision of, the Funds' Board of
Trustees (the "Board"). The Funds may invest in securities that are
primarily listed on foreign exchanges that trade on weekends or other days
when the Funds do not price their shares. The value of portfolio securities
held by the Funds may change on days when shareholders will not be able to
purchase or redeem shares.
Additionally, each of the Underlying Funds will be registered investment
companies, therefore their net asset value per share ("NAV") will be
calculated as set forth in their prospectuses. As noted above, each Fund is
a fund of funds, primarily invested in Underlying Funds that have their own
internal fair pricing and valuation procedures. Due to this structure, the
Underlying Funds' policies will be used in the daily calculation of their
NAV, which will, in turn, be used in calculating the Funds' NAVs. If for
any reason, an Underlying Fund does not provide its NAV to the Fund in
timely fashion for the Fund's NAV calculation, the last available NAV for
that Underlying Fund will be used for valuation purposes.
A Fund will fair value price its securities when market quotations are not
readily available. Generally, this would include securities for which
trading has been halted, securities whose value has been materially
affected by the occurrence of a significant event (as defined below),
securities whose price has become stale (i.e., the market price has
remained unchanged for five business days), and other securities where a
market price is not available from either a national pricing service or a
broker. In addition, the Pricing Committee will review exception priced
securities (i.e., securities for which the market value is provided by a
quote from a single broker rather than a national pricing service) on a
quarterly basis. In these situations, the Pricing Committee will employ
certain Board-approved methodologies to determine a fair value for the
securities. Fair valuations will be reviewed by the Board of Trustees on a
quarterly basis. Fair value pricing should result in a more accurate
determination of a Fund's net asset value price, which should eliminate the
potential for stale pricing arbitrage opportunities in a Fund. However,
fair value pricing involves the risk that the values used by a Fund to
price its investments may be different from those used by other investment
companies and investors to price the same investments.
Continued
Giant 5 Funds Investor Shares
Notes to Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
A "significant event" is one that occurred prior to a Fund's valuation
time, is not reflected in the most recent market price of a security, and
materially affects the value of a security. Generally, such "significant
events" relate to developments in foreign securities that occur after the
close of trading in their respective markets. The Fund's accounting agent
may obtain fair value prices of foreign securities through utilization of a
Fair Value Pricing Service previously approved by the Board where a
movement in the U.S. equities market is sufficiently large to constitute a
trigger established by the Pricing Committee.
Investment Transactions and Related Income:
Investment transactions are recorded on a trade date basis, except for on
the last day of the fiscal quarter end, when they are recorded on trade
date. Dividend income is recorded on the ex-dividend date. Securities gains
and losses are calculated based on the costs of the specific security (also
known as identified cost basis). Interest income is recognized on the
accrual basis and includes, where applicable, the amortization or accretion
of premium or discount.
Expenses:
Expenses directly attributable to a Fund are charged directly to the Fund.
Expenses relating to the Trust are allocated proportionately to each Fund
within the Trust according to the relative net assets of each Fund or on
another reasonable basis.
Organization and Offering Expenses:
All costs incurred by the Trust in connection with the organization of the
Funds, principally professional fees and printing, were paid on behalf of
the Trust by the Funds' investment adviser, The Willis Group, Inc. and will
not be borne by the Funds.
Costs incurred in connection with the offering and initial registration of
the Trust have been deferred and will be amortized on a straight-line basis
over the first twelve months after commencement of operations. Offering
expenses amortized during the period ended September 30, 2007 totaled
$1,544 and $1,544 for the Giant 5 Total Investment System and the Giant 5
Total Index System, respectively.
Distributions to Shareholders:
Dividends from net investment income, if any, are declared and distributed
semi-annually for all Funds. Dividends from net realized gains, if any, are
declared and distributed annually for all Funds.
The amounts of dividends from net investment income and of distributions
from net realized gains, if any, are determined in accordance with federal
income tax regulations and are recorded on the ex-dividend date. They may
differ from GAAP. These "book/tax" differences are either considered
temporary or permanent in nature. To the extent these differences are
permanent in nature, such amounts are reclassified within the composition
of net assets based on their federal tax-basis treatment; temporary
differences do not require reclassification. As of March 31, 2007,
distributions in excess of net investment income of $156,369 were
reclassified to accumulated undistributed net realized gain and paid-in
capital for the Giant 5 Total Investment System. As of March 31, 2007,
distributions in excess of net investment income of $44,312 were
reclassified to accumulated undistributed net realized gain and paid-in
capital for the Giant 5 Total Index System.
Federal Income Taxes:
Each Fund intends to qualify as a regulated investment company by complying
with the provisions available to certain investment companies, as defined
in Subchapter M of the Internal Revenue Code, and to make distributions
from net investment income and from net realized capital gains sufficient
to relieve it from all, or substantially all, federal income and excise
taxes. Therefore, no federal or excise tax provision is recorded.
Continued
Giant 5 Funds Investor Shares
Notes to Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
Use of Estimates:
The preparation of financial statements in conformity with accounting
principals generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities, and the disclosure 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.
Redemption Fees:
As of September 14, 2007, Giant 5 Funds have no redemption fee. Prior to
September 14, 2007, Giant 5 Funds had 1% redemption fee for selling within
180 days. This fee did not apply to shares purchased through reinvested
dividends or capital gains or shares held in certain omnibus accounts or
retirement plans that cannot implement the fee. For the period ended
September 30, 2007, the Giant 5 Total Investment System and the Giant 5
Total Index System had contributions to capital due to collection of
redemption fees in the amount of $2,155 and $924, respectively.
New Accounting Pronouncements:
Effective June 29, 2007, the Fund adopted Financial Accounting Standards
Board ("FASB") Interpretation No. 48 ("FIN 48") "Accounting for Uncertainty
in Income Taxes", a clarification of FASB Statement No. 109, Accounting for
Income Taxes. FIN 48 establishes financial accounting and disclosure
requirements for recognition and measurement of tax positions taken or
expected to be taken on an income tax return. The adoption of FIN 48 had no
impact on the Fund's net assets or results of operations.
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 September 30, 2007, the Funds do not believe the
adoption of SFAS No. 157 will impact the financial statement amounts;
however, additional disclosures may be required about the inputs used to
develop the measurements and the effect of certain of the measurements on
changes in net assets for the period.
3. Related Party Transactions
Investment Advisor:
The Willis Group, Inc. (the "Adviser") serves as the investment adviser to
each Fund. Under the terms of the investment advisory agreement, the
Adviser is entitled to receive fees computed daily and paid monthly at an
annual rate of 0.67% of average net assets of each Fund. The Adviser makes
the investment decisions for each of the Funds and continuously reviews,
supervises and administers the investment program of each Fund, subject to
the supervision of, and policies established by the Trustees of the Trust.
The amounts charged to the Funds for investment advisory services are
reported within the Statement of Operations.
Certain officers of the Adviser are also a Trustee and officers of the
Trust. An officer of the Adviser also serves as Chief Compliance Officer of
the Funds. The amounts charged to the Funds for Chief Compliance Officer
and Compliance Service fees are reported within the Statement of
Operations.
Continued
Giant 5 Funds Investor Shares
Notes to Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
Administrator:
BISYS Fund Services Ohio, Inc., served as the administrator for the Giant 5
Funds through June 30, 2007. BISYS Fund Services Ohio, Inc. (the former
"Administrator" or "BISYS"), a wholly-owned subsidiary of The BISYS Group,
Inc., served as administrator of the Trust. The Trust and the Administrator
had entered into a Master Services Agreement ("Master Services Agreement"),
under which the Administrator provided the Trust with administrative
services, including day-to-day administration of matters necessary to each
Fund's operations, maintenance of records and the books of the Trust,
preparation of reports and assistance with compliance monitoring of each
Fund's activities. Under the terms of the Master Services Agreement, the
Administrator was entitled to receive an annual asset-based fee for
administration and fund accounting of 10 basis points (0.10%) on the first
$250 million in aggregate net assets of all Funds; 7 basis points (0.07%)
of aggregate net assets of all Funds from over $250 million to $500
million; 5 basis points (0.05%) of aggregate net assets of all Funds from
over $500 million to $750 million; 4 basis points (0.04%) of aggregate net
assets of all Funds from over $750 million to $1 billion; and 3 basis
points (0.03%) of aggregate net assets of all Funds in excess of $1
billion. The annual asset-based fee was subject to an annual minimum equal
to the number of Funds multiplied by $65,000 and an annual additional per
class fee of $5,000 per class in excess of one class.
Certain officers of the Trust were employees of the former Administrator
(BISYS).
From July 1, 2007, UMB Fund Services, Inc. or "UMBFS", was the
Administrator for the Giant 5 Funds. For its services, UMBFS is paid a fee
by the Advisor at an annual rate equal to 0.09% on the first $500 million
in combined assets; 0.07% on the next $500 million in combined assets;
0.05% on the next $500 million in combined assets; and 0.03% on the
combined assets over $1.5 billion. The administration fees are subject to
an annual minimum of $135,000 in year one; $175,000 in year two; $200,000
in year three; and $225,000 in year four.
Distributor:
The Trust had retained BISYS Fund Services Limited Partnership (the
"Distributor"), a wholly-owned subsidiary of The BISYS Group, Inc. and an
affiliate of the Administrator, to serve as principal underwriter for the
shares of the Funds, pursuant to a Distribution Agreement between the
Distributor and the Adviser through June 30, 2007. Fees for such
distribution services were paid to the Distributor by the Adviser.
Since July 1, 2007, UMB Distribution Services, LLC has been the Distributor
of the Giant 5 Funds.
Distribution Plan:
Each Fund has adopted a Distribution Plan, pursuant to Rule 12b-1 under the
1940 Act (the "Distribution Plan") with respect to its Investor Shares.
Pursuant to the Distribution Plan, the Giant 5 Total Investment System and
the Giant 5 Total Index System each will pay 0.17% of its average daily net
assets attributable to its Investor Shares. The Distribution Plan provides
that the Funds pay the Distributor and other organizations for distributing
shares, for advertising and marketing and for providing certain services to
shareholders of the Investor Shares. For the period ended September 30,
2007, Giant 5 Total Investment System and Giant 5 Total Index System
incurred 12b-1 expenses of $26,509 and $21,693, respectively, for Investor
Shares.
Continued
Giant 5 Funds Investor Shares
Notes to Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
4. Purchases and Sales of Securities
Purchases and sales of investment securities, excluding short-term
securities for the period ended September 30, 2007, totaled:
Giant 5 Total Giant 5 Total
Investment System Index System
- --------------------------------------------------------------------------------
Purchases $6,593,359 $22,621,649
Sales 4,296,879 18,545,511
There were no purchases or sales of U.S. government securities for the
period.
5. Contingencies and Commitments
In the normal course of business, the Funds enter into contracts that
contain various representations and warranties and provide general
indemnifications. The Funds' maximum exposure under these arrangements is
dependent on future claims against the Funds and is presently unknown.
However, based on experience, the Funds consider risk of loss from such
potential claims to be remote.
6. Federal Tax Information
At September 30, 2007, the cost, gross unrealized appreciation and gross
unrealized depreciation on securities, for federal income tax purposes,
were as follows:
Giant 5 Total Giant 5 Total
Investment System Index System
- --------------------------------------------------------------------------------
Tax Cost $29,627,062 $29,332,127
Tax Unrealized Appreciation 4,424,556 2,273,715
Tax Unrealized (Depreciation) (83,537) (113,706)
Net Unrealized Appreciation 4,341,019 2,160,009
The tax character of distributions paid during the fiscal period ended
March 31, 2007 was as follows:
Giant 5 Total Giant 5 Total
Investment System Index System
- ------------------------------------------------------------------------------------------------------------------
Distributions Paid from Ordinary Income $461,110 $216,286
Distributions Paid from Net Long Term Capital Gains 238,738 4,131
Total Taxable Distributions 699,848 220,417
Return of Capital Distributions -- 6,502
Total Distributions Paid 699,848 226,919
Continued
<page>
Giant 5 Funds Investor Shares
Notes to Financial Statements September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
As of March 31, 2007, the components of accumulated earnings on a tax basis
were as follows:
Giant 5 Total Giant 5 Total
Investment System Index System
- -----------------------------------------------------------------------------------------------------------------------------
Undistributed Ordinary Income $ -- $ --
Undistributed Long Term Capital Gains 674,982 --
Accumulated Earnings 674,982 --
Distributions Payable -- --
Accumulated Capital and Other Losses -- --
Unrealized Appreciation 1,722,902 1,850,862
Total Accumulated Earnings 2,397,884 1,850,862
The difference between book basis and tax-basis unrealized appreciation is
attributable primarily to the tax deferral of losses on wash sales and
other temporary differences.
7. Control Ownership
The beneficial ownership, either directly or indirectly, of more than 25%
of the voting securities creates a presumption of control of the Fund,
under Section 2(a)(9) of the 1940 Act.
As of September 30, 2007, The Andrea S. Swanson Trust and the Swanson
Descendants' Trust as well as the Jann Simmons Patigian Trust and the Jann
Simmons Descendants' Trust had combined ownership in the Giant 5 Total
Index System in the amounts of 27.5% and 26.6%, respectively.
Statement Regarding Availability of Quarterly Portfolio Schedule.
The Giant 5 Funds file complete schedules of portfolio holdings for each Fund
with the Securities and Exchange Commission (the "Commission") for the first and
third quarters of each fiscal year on Form N-Q. The Funds' Forms N-Q are
available on the Commission's website at http://www.sec.gov. The Funds' Form N-Q
may be reviewed and copied at the Commission's Public Reference Room in
Washington, D.C., and information on the operation of the Public Reference Room
may be obtained by calling 1-800-SEC-0330; and the Funds make the information on
Form N-Q available upon request without charge.
Statement Regarding Availability of Proxy Voting Policies and Procedures and
Proxy Voting Record.
A description of the policies and procedures the Funds use to determine how to
vote proxies relating to the portfolio securities is available without charge,
upon request, by calling 1-800-788-5680 or on the Commission's website at
http://www.sec.gov. A copy of the Funds' voting record for the most recent
12-month period ended June 30 is also available at the SEC's website at
http://www.sec.gov.
Continued
<page>
Giant 5 Funds Investor Shares
For the Six Months Ended
Supplemental Information September 30, 2007 (Unaudited)
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Giant 5 Funds, you incur two types of costs: (1)
transaction costs, including redemption fees and exchange fees; and (2) ongoing
costs, including investment advisory fees, distribution (12b-1) fees, and other
fund expenses. The Examples below are intended to help you understand your
ongoing costs (in dollars) of investing in the Funds and to compare these costs
with the ongoing costs of investing in other mutual funds.
Each is based on an investment of $1,000 invested at the beginning of the period
and held for the entire period from April 1, 2007 through September 30, 2007.
Actual Expenses
The table below provides information about actual account values and actual
expenses. You may use the information below, together with the amount you
invested, to estimate the expenses you paid over the period. Simply divide your
account value by $1,000 (for example, an $8,600 account value divided by $1,000
= 8.6), then multiply the result by the number in the table under the heading
entitled "Expenses Paid During Period" to estimate the expenses you paid on your
account during the period.
Expenses paid Expense Ratio
Beginning account Ending account during period during period
value 4/1/07 value 9/30/07 4/1/07-9/30/07(1) 4/1/07-9/30/07(1)
- --------------------------------------------------------------------------------------------------------------------------------
Giant 5 Total Investment System $1,000.00 $1,105.10 $9.53 1.81%
Giant 5 Total Index System 1,000.00 1,075.10 9.31 1.79
Hypothetical Example for Comparison Purposes
The table below provides information about hypothetical account values and
hypothetical expenses based on the Giant 5 Funds' actual expense ratios and an
assumed rate of return of 5% per year before expenses, which is not the Funds'
actual return. The hypothetical account values and expenses may not be used to
estimate the actual ending account balance or expenses you paid for the period.
However, you may use this information to compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of the
other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads), redemption fees, or exchange fees, if applicable. Therefore,
the table is useful in comparing the ongoing costs only, and will not help you
determine the relative total costs of owning different funds. In addition, if
these transactional costs were included, your costs would have been higher.
Expenses paid Expense Ratio
Beginning account Ending account during period during period
value 4/1/07 value 9/30/07 4/1/07-9/30/07(1) 4/1/07-9/30/07(1)
- -----------------------------------------------------------------------------------------------------------------------------------
Giant 5 Total Investment System $1,000.00 $1,015.10 $9.12 1.81%
Giant 5 Total Index System 1,000.00 1,016.03 9.05 1.79
(1) Expenses are equal to the average account value times the Giant 5 Total
Investment System and the Total Index System Funds' expense ratio of 1.81%
and 1.79%, respectively, multiplied by the number of days in the period
(183), divided by the number of days in the fiscal year (366).
INVEST IN THE ESSENTIALS. INVEST FOR LIFE (TM)
[LOGO] GIANT 5 FUNDS
[IMAGE] CAPITAL MARKETS [IMAGE] REAL ESTATE [IMAGE] BONDS [IMAGE] ENERGY [IMAGE] RAW MATERIALS
FUNDS DISTRIBUTED BY UMB DISTRIBUTION SERVICES, LLC
giant5.com
(c) 2007 Giant 5 Funds, Colorado
Item 2. Code of Ethics
Not applicable to semi-annual reports.
Item 3. Audit Committee Financial Expert
Not applicable to semi-annual reports.
Item 4. Principal Accountant Fees and Services
Not applicable to semi-annual reports.
Item 5. Audit Committee of Listed Registrants
Not applicable.
Item 6. Schedule of Investments
Included as part of the report to shareholders filed under item 1 of this
Form N-CSR
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders
There were no material changes to the procedures by which shareholders may
recommend nominees to the registrant's Board of Trustees.
Item 11. Controls and Procedures
(a) Based on an evaluation of the disclosure controls and procedures (as
defined in Rule 30a-3(c) under the Investment Company Act of 1940, as
amended, the "Disclosure Controls") as of a date within 90 days of the
filing date (the "Filing Date") of this Form N-CSR (the "Report"), the
registrant's principal executive officer and principal financial officer
have concluded that the Disclosure Controls are effectively designed to
ensure that information that is required to be disclosed by the registrant
in the Report is recorded, processed, summarized and reported within the
time periods specified in the Securities and Exchange Commission's rules
and forms, including ensuring that information required to be disclosed in
the Report is accumulated and communicated to the registrant's management,
including the registrant's principal executive officer and principal
financial officer, as appropriate to allow timely decisions regarding
required disclosures.
(b) There were no changes in the registrant's internal controls over financial
reporting (as defined in Rule 30 a-3(d) under the Investment Company Act of
1940) that occurred during the second fiscal quarter of the period covered
by this report that have materially affected, or are reasonably likely to
materially affect, the registrant's internal control over financial
reporting.
Item 12. Exhibits
(a)(1) Not applicable.
(2) Certifications for each principal executive and principal financial
officer 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) Certifications required by Rule 30a-2 (b) under the Investment Company
Act of 1940, as amended, (17 CFR 270.30a-2 (b)) are filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Giant 5 Funds
/s/Michael G. Willis
- ----------------------------------
Michael G. Willis
President
November 30, 2007
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.
/s/Michael G. Willis
- ------------------------------------
Michael G. Willis
President
(Principal Executive Officer)
November 30, 2007
/s/Paul D. Myers
- -------------------------------------
Paul D. Myers
Treasurer
(Principal Financial Officer)
November 30, 2007