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: 811-21335
Exact name of registrant as specified in charter: OPTIMUM FUND TRUST
Address of principal executive offices:
2005 Market Street
Philadelphia, PA 19103
Name and address of agent for service:
Richelle S. Maestro, Esq.
2005 Market Street
Philadelphia, PA 19103
Registrant's telephone number, including area code: (800) 523-1918
Date of fiscal year end: March 31
Date of reporting period: September 30, 2003
Item 1. Reports to Stockholders
Semiannual Report 2004
- --------------------------------------------------------------------------------
OPTIMUM FIXED INCOME FUND
OPTIMUM INTERNATIONAL FUND
OPTIMUM LARGE CAP GROWTH FUND
OPTIMUM LARGE CAP VALUE FUND
OPTIMUM SMALL CAP GROWTH FUND
OPTIMUM SMALL CAP VALUE FUND
Table
OF CONTENTS
- -------------------------------------------------------------------
FINANCIAL STATEMENTS:
Statements of Net Assets 1
Statements of Assets and Liabilities 20
Statements of Operations 21
Statements of Changes in Net Assets 23
Financial Highlights 25
Notes to Financial Statements 31
- -------------------------------------------------------------------
Funds are not FDIC insured and are not guaranteed. It is possible to lose the
principal amount invested.
Mutual fund advisory services provided by Delaware Management Company, a
series of Delaware Management Business Trust, which is a registered
investment advisor.
(C)2003 Delaware Distributors, L.P.
Statements Optimum Fixed Income Fund
OF NET ASSETS September 30, 2003 (Unaudited)
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Agency Collateralized Mortgage Obligations - 2.48%
- --------------------------------------------------------------------------------
Fannie Mae
Series 02-70 QD 5.50% 6/25/26 $ 25,000 $ 26,045
Series 03-106 WB 4.50% 10/25/23 35,000 36,318
Series 03-87 TD 3.50% 4/25/11 30,000 30,152
Series 03-W99 A2B 4.71% 9/15/18 25,000 25,910
Freddie Mac
3.50% 1/15/10 25,000 25,475
3.75% 8/15/18 25,000 25,645
5.00% 2/15/22 19,807 20,649
5.00% 10/15/22 25,000 24,826
5.50% 6/15/30 8,167 8,237
6.00% 11/15/31 5,144 5,351
Freddie Mac
Series T-58 1A2 6.50% 9/25/34 5,000 5,030
Series T-58 2A 6.50% 9/25/34 10,000 10,644
Series T-58 3A 7.00% 10/15/42 20,000 21,669
-----------
Total Agency Collateralized Mortgage
Obligations (cost $262,772) 265,951
-----------
- --------------------------------------------------------------------------------
Agency Mortgage-Backed Securities - 10.47%
- --------------------------------------------------------------------------------
Fannie Mae
4.50% 10/1/18 TBA 185,000 186,561
4.92% 5/1/13 25,000 26,219
5.00% 11/1/17 35,933 36,809
5.00% 6/1/18 38,859 39,867
5.00% 8/1/18 30,000 30,778
5.00% 9/1/23 35,000 35,355
5.50% 10/25/31 TBA 15,000 15,305
5.50% 7/1/33 117,940 120,408
5.50% 9/1/33 69,386 70,839
6.00% 10/1/31 TBA 275,000 283,851
6.00% 9/1/33 20,000 20,650
6.00% 10/1/33 20,000 20,650
6.06% 5/1/12 16,685 18,625
6.50% 10/25/29 TBA 75,000 78,188
7.00% 12/1/06 7,581 8,434
7.50% 3/1/32 18,399 19,641
Freddie Mac
5.00% 7/1/18 44,290 45,411
5.00% 9/1/33 TBA 10,000 10,075
5.00% 10/1/33 20,000 19,994
6.50% 9/1/33 32,401 33,849
-----------
Total Agency Mortgage-Backed Securities
(cost $1,107,201) 1,121,509
-----------
- --------------------------------------------------------------------------------
Agency Obligations - 0.42%
- --------------------------------------------------------------------------------
Fannie Mae 2.375% 4/13/06 40,000 40,121
Freddie Mac 4.50% 7/15/13 5,000 5,059
-----------
Total Agency Obligations (cost $44,598) 45,180
-----------
- --------------------------------------------------------------------------------
Asset-Backed Securities - 2.07%
- --------------------------------------------------------------------------------
Capital One Auto Finance Trust
Series 03-A A4A 2.47% 1/15/10 20,000 19,899
Citibank Credit Card Issuance Trust
Series 02-A1 A1 4.95% 2/9/09 30,000 32,233
Detroit Edison Securitization Funding LLC
Series 01-1 A6 6.62% 3/1/16 20,000 22,982
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Asset-Backed Securities (continued)
- --------------------------------------------------------------------------------
PP&L Transition Bond LLC Series 99-1 A5
6.83% 3/25/07 $ 10,000 $ 10,476
SLM Student Loan Trust Series 97-2
Certificates 1.837% 10/25/13 25,000 25,013
WFS Financial Owner Trust Series 03-3 A4
3.25% 5/20/11 20,000 20,290
Whole Auto Loan Trust
Series 03-1 A4 2.58% 3/15/10 45,000 45,217
Series 03-1 B 2.24% 3/15/10 45,000 45,162
-----------
Total Asset-Backed Securities (cost $218,637) 221,272
-----------
- --------------------------------------------------------------------------------
Collateralized Mortgage Obligations - 1.14%
- --------------------------------------------------------------------------------
Bank of America Mortgage Securities
Series 03-I 2A4 3.828% 10/25/33 5,000 5,025
Bear Stearns Adjustable Rate Mortgage
Series 03-7 A8 4.831% 10/25/33 5,000 4,963
Countrywide Home Loans Series 03-1 1A7
4.50% 3/25/33 18,369 18,596
CS First Boston Mortgage Securities
Series 03-8 5A1 6.50% 4/25/33 8,607 9,000
Series 03-23 5A1 6.00% 9/25/33 5,000 5,134
Series 03-23 6A1 6.50% 9/1/33 10,000 10,408
Series 03-23 7A1 5.00% 9/25/18 10,000 10,194
Master Adjustable Rate Mortgages Trust
Series 03-3 3A4 4.625% 9/25/33 35,000 35,787
Structured Asset Securities Series 02-22H 1A
7.00% 11/25/32 2,749 2,866
Washington Mutual MSC Mortgage
Pass-Through CTFS Series 01-MS15 SA1
6.00% 1/25/17 20,013 20,602
-----------
Total Collateralized Mortgage Obligations
(cost $121,179) 122,575
-----------
- --------------------------------------------------------------------------------
Commercial Collateralized Mortgage-Backed Securities - 0.32%
- --------------------------------------------------------------------------------
First Union-Lehman Brothers-Bank of
America Series 98-C2 A2 6.56% 11/18/08 15,000 16,996
Nomura Asset Securities Series 98-D6 A1B
6.59% 3/15/30 15,000 17,060
-----------
Total Commercial Collateralized
Mortgage-Backed Securities (cost $33,531) 34,056
-----------
- --------------------------------------------------------------------------------
Corporate Bonds - 22.55%
- --------------------------------------------------------------------------------
Aerospace & Defense - 0.15%
*Armor Holdings 144A 8.25% 8/15/13 15,000 15,938
-----------
15,938
-----------
Automobiles & Automotive Parts - 0.34%
*Advance Accessory Systems 144A
10.75% 6/15/11 5,000 5,400
General Motors
7.125% 7/15/13 10,000 10,508
8.375% 7/15/33 5,000 5,243
Johnson Controls 4.875% 9/15/13 5,000 5,143
*United Component 144A 9.375% 6/15/13 10,000 10,450
-----------
36,744
-----------
1
Statements Optimum Fixed Income Fund
OF NET ASSETS (CONTINUED)
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
- --------------------------------------------------------------------------------
Banking, Finance & Insurance - 4.62%
Aegon NV 4.75% 6/1/13 $ 10,000 $ 9,947
Alamosa Delaware 12.50% 2/1/11 5,000 4,850
American General Finance 4.625% 9/1/10 25,000 25,656
AON 7.375% 12/14/12 5,000 5,805
Bear Stearns Company
4.00% 1/31/08 5,000 5,157
4.65% 7/2/18 5,000 4,650
Bluewater Finance 10.25% 2/15/12 10,000 10,200
Capital One Bank
4.875% 5/15/08 5,000 5,184
5.75% 9/15/10 5,000 5,270
6.50% 6/13/13 5,000 5,127
Cendant 7.375% 1/15/13 5,000 5,776
Citigroup
5.675% 8/27/12 10,000 10,753
5.875% 2/22/33 5,000 5,077
Countrywide Home 1.76% 6/2/06 10,000 10,033
Credit Suisse First Boston USA
4.63% 1/15/08 5,000 5,273
*Crum & Forster 144A 10.375% 6/15/13 5,000 5,463
*Erac USA Finance 144A 7.35% 6/15/08 5,000 5,793
*Farmers Exchange Capital 144A
7.05% 7/15/28 5,000 4,692
7.20% 7/15/48 10,000 8,882
Finova Group 7.50% 11/15/09 15,000 7,500
Ford Motor Credit
5.625% 10/1/08 5,000 5,063
5.80% 1/12/09 15,000 15,142
7.00% 10/1/13 5,000 5,041
7.45% 7/16/31 10,000 9,248
7.50% 3/15/05 65,000 68,991
*Gemstone Investments 144A
7.71% 10/31/04 5,000 4,963
General Electric Capital 5.45% 1/15/13 10,000 10,523
GMAC
6.75% 1/15/06 5,000 5,350
7.25% 3/2/11 5,000 5,303
8.00% 11/1/31 5,000 5,150
Goldman Sachs 4.75% 7/15/13 10,000 9,916
*ING Bank 144A 5.125% 5/1/15 10,000 10,198
JP Morgan Chase 5.75% 1/2/13 5,000 5,350
Morgan Stanley 5.30% 3/1/13 10,000 10,353
*New York Life 144A 5.875% 5/15/33 5,000 5,020
*Oil Insurance 144A 5.15% 8/15/33 5,000 5,121
Orion Power Holdings 12.00% 5/1/10 10,000 11,350
Popular North America 4.25% 4/1/08 10,000 10,295
Prudential Financial 5.75% 7/15/33 5,000 4,764
Qwest Capital Funding 5.875% 8/3/04 15,000 14,925
RBS Capital Trust I 4.71% 12/29/49 5,000 4,847
Regions Financial 6.375% 5/15/12 5,000 5,623
*Sheridan Acquisition 144A 10.25% 8/15/11 10,000 10,463
SLM Corporate 5.625% 8/1/33 30,000 28,762
Technical Olympic 10.375% 7/1/12 10,000 10,800
TIG Holdings 8.125% 4/15/05 10,000 10,050
Travelers Property Casualty 6.375% 3/15/33 7,000 7,467
UFJ Finance Arub 6.75% 7/15/13 15,000 15,743
Wells Fargo Financial 6.125% 4/18/12 10,000 11,118
*Zurich Capital Trust 144A 8.375% 6/1/37 15,000 17,249
-----------
495,276
-----------
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
- --------------------------------------------------------------------------------
Building & Materials - 0.46%
GBP Home 9.50% 2/15/11 $ 5,000 $ 5,506
*Lone Star industries 144A 8.85% 6/15/05 10,000 10,450
*Meritage 144A 9.75% 6/1/11 10,000 11,000
Schuler Homes 10.50% 7/15/11 10,000 11,388
Standard Pacific 9.25% 4/15/12 10,000 10,975
-----------
49,319
-----------
Business Services - 0.21%
Alderwoods Group 12.25% 1/2/09 10,000 11,125
Brickman Group 11.75% 12/15/09 10,000 11,300
-----------
22,425
-----------
Cable, Media & Publishing - 2.62%
AOL Time Warner
6.75% 4/15/11 22,000 24,611
7.70% 5/1/32 5,000 5,762
Charter Communications 10.00% 4/1/09 50,000 39,750
Comcast 7.05% 3/15/33 10,000 11,003
Comcast Cable Communications
6.875% 6/15/09 25,000 28,547
CSC Holdings 8.125% 7/15/09 10,000 10,350
++Insight Communications 12.125% 2/15/11 20,000 14,750
Insight Midwest 10.50% 11/1/10 10,000 10,500
Liberty Media
3.50% 9/25/06 45,000 44,890
8.25% 2/1/30 5,000 5,809
Mediacom LLC 9.50% 1/15/13 25,000 23,813
*PEI Holdings 144A 11.00% 3/15/10 10,000 11,100
Time Warner
8.18% 8/15/07 5,000 5,815
8.375% 3/15/23 5,000 6,201
USA Interactive 6.75% 11/15/05 5,000 5,398
Vertis 10.875% 6/15/09 15,000 15,488
++XM Satellite Radio 14.00% 12/31/09 20,000 16,700
-----------
280,486
-----------
Chemicals - 0.77%
Dow Chemical 6.00% 10/1/12 5,000 5,261
Huntsman ICI Chemicals 10.125% 7/1/09 5,000 4,775
*Huntsman International 144A 9.875% 3/1/09 5,000 5,275
Lyondell Chemical 9.625% 5/1/07 10,000 9,550
*Radnor Holdings 144A 11.00% 3/15/10 10,000 8,500
*Rhodia ZAR 144A 8.875% 6/1/11 15,000 14,812
Solutia 6.72% 10/15/37 15,000 14,475
*Solutia 144A 11.25% 7/15/09 5,000 4,875
Union Carbide 6.79% 6/1/25 10,000 9,200
Valspar 6.00% 5/1/07 5,000 5,425
-----------
82,148
-----------
Commercial Services - 0.14%
Corrections Corporation of America
7.50% 5/1/11 10,000 10,363
*Corrections Corporation of America 144A
7.50% 5/1/11 5,000 5,181
-----------
15,544
-----------
2
Statements Optimum Fixed Income Fund
OF NET ASSETS (CONTINUED)
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
- --------------------------------------------------------------------------------
Computers & Technology - 0.35%
*Amkor Technologies 144A 7.75% 5/15/13 $ 10,000 $ 10,101
Chippac International 12.75% 8/1/09 10,000 11,200
*Cooperative Computing 144A 10.50% 6/15/11 5,000 5,425
Dell Computer 6.55% 4/15/08 5,000 5,680
*Electric Data Systems 144A 6.00% 8/1/13 5,000 4,816
-----------
37,222
-----------
Consumer Products - 1.25%
*Aviall 144A 7.625% 7/1/11 10,000 10,300
*Commonwealth BR 144A 10.625% 9/1/08 10,000 10,750
*Hines Nurseries 144A 10.25% 10/1/11 10,000 10,500
*Jafra Cosmetics 144A 10.75% 5/15/11 10,000 10,900
*++Johnsondiversey 144A 10.67% 5/15/13 10,000 7,000
*National Beef Packing 144A 10.50% 8/1/11 15,000 16,424
Salton 10.75% 12/15/05 15,000 14,813
*Seminis Vegtable 144A 10.25% 10/1/13 15,000 16,088
Tyco International Group ZAR
6.375% 2/15/06 25,000 26,312
UST 6.625% 7/15/12 10,000 11,207
-----------
134,294
-----------
Electronics & Electrical Equipment - 0.05%
Pepco Holdings 6.45% 8/15/12 5,000 5,350
-----------
5,350
-----------
Energy - 1.98%
Amerada Hess 7.30% 8/15/31 5,000 5,366
Aquila 7.95% 2/1/11 10,000 10,100
*Citgo Petroleum 144A 11.375% 2/1/11 10,000 11,350
*Dynegy Holdings 144A 10.125% 7/15/13 10,000 10,600
El Paso
7.00% 5/15/11 10,000 8,300
7.875% 6/15/12 5,000 4,225
*El Paso 144A 7.625% 8/1/10 5,000 4,875
*El Paso Production 144A 7.75% 6/1/13 5,000 4,775
Enterprise Products 6.875% 3/1/33 5,000 5,407
Hanover Equipment 8.50% 9/1/08 10,000 10,350
*Kern River Funding 144A 4.893% 4/30/18 4,939 4,978
Kinder Morgan 7.75% 3/15/32 15,000 18,240
Pemex Master Trust 9.125% 10/13/10 65,000 78,164
Tennessee Gas 8.375% 6/15/32 10,000 9,800
Valero Logistics 6.05% 3/15/13 10,000 10,466
Williams Companies
6.625% 11/15/04 5,000 5,075
8.125% 3/15/12 10,000 10,450
-----------
212,521
-----------
Environmental Services - 0.15%
*Casella Waste 144A 9.75% 2/1/13 5,000 5,450
IESI 10.25% 6/15/12 10,000 10,900
-----------
16,350
-----------
Food, Beverage & Tobacco - 0.93%
Advantica Restaurant 12.75% 9/30/07 10,000 9,900
B&G Foods 9.625% 8/1/07 10,000 10,300
DiGiorgio Series B 10.00% 6/15/07 15,000 14,963
Kraft Foods
4.00% 10/1/08 10,000 10,105
5.625% 11/1/11 5,000 5,278
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
- --------------------------------------------------------------------------------
Food, Beverage & Tobacco (continued)
*LE-Natures 144A 9.00% 6/15/13 $ 10,000 $ 10,500
*Miller Brewing 144A 4.25% 8/15/08 5,000 5,143
Nabisco 6.85% 6/15/05 5,000 5,406
Safeway 6.15% 3/1/06 5,000 5,426
Tysons Food 8.25% 10/1/11 5,000 5,989
Universal 6.50% 2/15/06 5,000 5,470
Wendy's International
6.20% 6/15/14 5,000 5,573
6.25% 11/15/11 5,000 5,566
-----------
99,619
-----------
Healthcare & Pharmaceuticals - 0.25%
Alliance Imaging 10.375% 4/15/11 10,000 10,450
Medco Health Solutions 7.25% 8/15/13 5,000 5,339
Team Health 12.00% 3/15/09 10,000 10,550
-----------
26,339
-----------
Leisure, Lodging & Entertainment - 0.44%
*Hard Rock Hotel 144A 8.875% 6/1/13 5,000 5,294
Herbst Gaming 10.75% 9/1/08 10,000 11,162
Lodgenet Entertainment 9.50% 6/15/13 10,000 10,650
Royal Caribbean 7.50% 10/15/27 10,000 9,100
*Worldspan LP/WS Finance 144A
9.625% 6/15/11 10,000 10,525
-----------
46,731
-----------
Metals & Mining - 0.22%
AK Steel 7.75% 6/15/12 10,000 6,950
Barrick Gold 7.50% 5/1/07 5,000 5,752
US Steel 10.75% 8/1/08 10,000 10,700
-----------
23,402
-----------
Packaging & Containers - 0.38%
AEP Industries 9.875% 11/15/07 10,000 9,850
Portola Packaging 10.75% 10/1/05 10,000 10,000
*Seabulk International 144A 9.50% 8/15/13 10,000 10,087
*Sealed Air 144A
5.375% 4/15/08 5,000 5,220
5.625% 7/15/13 5,000 5,075
-----------
40,232
-----------
Paper & Forest Products - 0.24%
Consolidated Container 10.125% 7/15/09 10,000 5,100
Georgia-Pacific 9.875% 11/1/21 20,000 20,500
-----------
25,600
-----------
Real Estate - 0.24%
*Developers Divers Realty 144A 4.63% 8/1/10 5,000 4,992
Tanger Properties L.P. 9.125% 2/15/08 10,000 10,975
*WCI Communities 144A 7.875% 10/1/13 10,000 10,075
-----------
26,042
-----------
Retail - 1.30%
J Crew Operating 10.375% 10/15/07 10,000 10,200
Kroger Company 6.80% 4/1/11 80,000 91,591
*Office Depot 144A 6.25% 8/15/13 5,000 5,331
Petco Animal Supplies 10.75% 11/1/11 10,000 11,550
Remington Arms 10.50% 2/1/11 10,000 10,300
Wal-Mart Stores 3.375% 10/1/08 10,000 10,067
-----------
139,039
-----------
3
Statements Optimum Fixed Income Fund
OF NET ASSETS (CONTINUED)
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
- --------------------------------------------------------------------------------
Telecommunications - 2.28%
*Alaska Communications Systems 144A
9.875% 8/15/11 $ 10,000 $ 10,250
oAmerican Tower Escrow
8.839% 8/1/08 5,000 3,350
AT&T
7.00% 11/15/06 5,000 5,639
8.00% 11/15/31 5,000 5,941
*Centennial Cell 144A 10.125% 6/15/13 10,000 10,350
*Cincinnati Bell 144A 7.25% 7/15/13 5,000 4,975
Crown Castle Communications
10.75% 8/1/11 5,000 5,575
*Eircom Funding 144A 8.25% 8/15/13 5,000 5,400
*Level 3 Communications 144A
10.75% 10/15/11 15,000 15,000
+MCI Communications 7.50% 8/20/04 10,000 7,925
*Metropcs 144A 10.75% 10/1/11 10,000 10,250
Northern Telecommunications
7.40% 6/15/06 10,000 10,275
7.875% 6/15/26 15,000 14,475
Panamsat 8.50% 2/1/12 15,000 15,788
Sprint Capital
6.375% 5/1/09 5,000 5,444
8.375% 3/15/12 5,000 5,909
8.75% 3/15/32 5,000 5,962
Time Warner Telecommunications LLC
9.75% 7/15/08 10,000 9,900
Verizon Maryland 5.13% 6/15/33 10,000 8,910
Verizon New York 6.875% 4/1/12 40,000 45,763
Verizon Pennsylvania 5.65% 11/15/11 25,000 26,830
Verizon Wireless Capital
5.375% 12/15/06 10,000 10,821
-----------
244,732
-----------
Textiles, Apparel & Furniture - 0.08%
Levi Strauss 12.25% 12/15/12 10,000 8,050
-----------
8,050
-----------
Transportation & Shipping - 0.75%
Continental Airlines 6.50% 6/15/11 15,000 14,710
Delta Air Lines Series 02-1 6.417% 7/2/12 35,000 37,298
HORNBECK-LEEVAC Marine Services
10.625% 8/1/08 10,000 11,025
Overseas Shipholding Group 8.25% 3/15/13 10,000 10,500
USX Corporation 9.125% 1/15/13 5,000 6,532
-----------
80,065
-----------
Utilities - 2.35%
*Allegheny Energy 144A
10.25% 11/15/07 10,000 10,050
13.00% 11/15/07 5,000 4,875
American Electric Power 6.125% 5/15/06 60,000 64,998
Avista 9.75% 6/1/08 10,000 11,700
Calpine
8.25% 8/15/05 5,000 4,450
10.50% 5/15/06 15,000 13,350
Consolidated Edison Company
of New York 3.625% 8/1/08 5,000 5,055
Consumers Energy 6.00% 3/15/05 5,000 5,261
*Dayton Power & Light 144A 5.13% 10/1/13 5,000 5,082
Energy East Corporation 6.75% 9/15/33 10,000 10,512
Homer City Funding 8.137% 10/1/19 10,000 10,350
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Corporate Bonds (continued)
- --------------------------------------------------------------------------------
Utilities (continued)
Illinois Power 11.50% 12/15/10 $ 5,000 $ 6,025
Midland Funding II 11.75% 7/23/05 4,582 5,006
Midwest Generaton 8.30% 7/2/09 10,000 9,650
National Rural Utilities 3.875% 2/15/08 5,000 5,156
Nisource Finance 7.50% 11/15/03 5,000 5,031
Oncor Electric 7.00% 5/1/32 5,000 5,587
*Power Contract 144A 5.20% 2/1/06 10,000 9,992
PSEG Energy 7.75% 4/16/07 5,000 5,000
PSEG Power 8.625% 4/15/31 5,000 6,348
Rochester Gas & Electric 6.375% 9/1/33 5,000 5,249
Sempra Energy
6.00% 2/1/13 5,000 5,402
6.925% 7/1/04 5,000 5,195
Southern Natural Gas 8.875% 3/15/10 10,000 10,750
Transcontinental Gas Pipeline
8.875% 7/15/12 10,000 11,363
*TXU Energy 144A 7.00% 3/15/13 10,000 10,894
-----------
252,331
-----------
Total Corporate Bonds (cost $2,361,018) 2,415,799
-----------
- --------------------------------------------------------------------------------
Foreign Bonds - 9.80%
- --------------------------------------------------------------------------------
Australia - 0.45%
New South Wales Treasury
8.00% 3/1/08 AUD 22,000 16,427
Queensland Treasury 6.00% 6/14/11 AUD 45,000 31,424
-----------
47,851
-----------
Austria - 0.27%
Oesterreich Kontrollbank
1.80% 3/22/10 JPY 3,000,000 28,381
-----------
28,381
-----------
Brazil - 0.22%
Federal Republic of Brazil
10.00% 8/7/11 USD 12,000 11,820
14.50% 10/15/09 USD 10,000 12,060
-----------
23,880
-----------
Canada - 0.74%
Ainsworth Lumber
12.50% 7/15/07 USD 15,000 17,250
13.875% 7/15/07 USD 10,000 11,500
Canada Government 0.70% 3/20/06 JPY 2,000,000 18,088
*Hollinger 144A 11.875% 3/1/11 USD 10,000 11,100
Tembec Industries 8.625% 6/30/09 USD 5,000 4,950
Thomson 5.75% 2/1/08 USD 5,000 5,471
Western Oil Sands 8.375% 5/1/12 USD 10,000 11,375
-----------
79,734
-----------
Chile - 0.17%
Celulosa Arauco 8.625% 8/15/10 USD 15,000 18,116
-----------
18,116
-----------
Columbia - 0.21%
Republic of Colombia
10.00% 1/23/12 USD 10,000 10,925
10.75% 1/15/13 USD 10,000 11,250
-----------
22,175
-----------
4
Statements Optimum Fixed Income Fund
OF NET ASSETS (CONTINUED)
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Foreign Bonds (continued)
- --------------------------------------------------------------------------------
Dominican Republic - 0.14%
Federal Republic of Dominica
9.04% 1/23/13 USD 12,000 10,502
*Federal Republic of Dominica 144A
9.04% 4/1/13 USD 5,000 4,550
-----------
15,052
-----------
Ecuador - 0.06%
++Republic of Ecuador
5.00% 8/15/30 USD 10,000 6,295
-----------
6,295
-----------
Finland - 1.51%
Republic of Finland
5.00% 4/25/09 EUR 55,000 69,379
5.75% 2/23/11 EUR 70,000 92,191
-----------
161,570
-----------
France - 0.36%
France Government O.A.T.
5.50% 10/25/07 EUR 25,000 31,891
France Telecom 10.00% 3/1/31 USD 5,000 6,699
-----------
38,590
-----------
Germany - 1.91%
Deutschland Republic
4.00% 7/4/09 EUR 20,000 24,044
4.125% 7/4/08 EUR 110,000 133,529
KFW International Finance
1.75% 3/23/10 JPY 5,000,000 47,045
-----------
204,618
-----------
Ireland - 0.09%
Smurfit Capital 7.50% 11/20/25 USD 10,000 9,550
-----------
9,550
-----------
Italy - 0.17%
Republic of Italy 5.75% 7/25/16 EUR 14,000 18,440
-----------
18,440
-----------
Netherlands - 0.10%
Deutsche Telekom 5.25% 7/22/13 USD 5,000 5,065
Telefonica Europe 7.35% 9/15/05 USD 5,000 5,507
-----------
10,572
-----------
Norway - 0.37%
Kingdom of Norway 6.00% 5/16/11 NOK 200,000 30,858
Ocean Rig Norway 10.25% 6/1/08 USD 10,000 8,950
-----------
39,808
-----------
Poland - 0.35%
Poland Government 5.00% 10/24/13 PLZ 160,000 37,722
-----------
37,722
-----------
Russia - 0.11%
++Russian Federation 5.00% 3/31/30 USD 12,000 11,370
-----------
11,370
-----------
Supranational - 1.34%
European Investment Bank
3.00% 9/20/06 JPY 12,000,000 115,690
InterAmerican Development Bank
1.90% 7/8/09 JPY 3,000,000 28,386
-----------
144,076
-----------
Principal Market
Amount* Value (U.S.$)
- --------------------------------------------------------------------------------
Foreign Bonds (continued)
- --------------------------------------------------------------------------------
Sweden - 0.89%
*Nordea Bank 144A 5.25% 11/30/12 USD 5,000 $ 5,214
Stena AB 9.625% 12/1/12 USD 15,000 16,388
Swedish Government
5.50% 10/8/12 SEK 530,000 74,029
-----------
95,631
-----------
United Kingdom - 0.24%
Avecia Group PLC 11.00% 7/1/09 USD 10,000 8,800
Royal Bank Scotland
7.816% 11/29/49 USD 15,000 16,834
-----------
25,634
-----------
Venezuela - 0.10%
*Venezuela 144A 10.75% 9/19/13 USD 12,000 11,100
-----------
11,100
-----------
Total Foreign Bonds (cost $1,020,115) 1,050,165
-----------
- --------------------------------------------------------------------------------
Municipal Bonds - 1.81%
- --------------------------------------------------------------------------------
City Government Obligation Bonds - 0.25%
Hoboken NJ Refunding Taxable Pension
6.50% 4/1/26 (MBIA) 25,000 26,437
-----------
26,437
-----------
Miscellaneous Revenue Bonds - 0.39%
LA Quinta Redevelopment Agency
Tax Allocation
5.45% 9/1/13 (AMBAC) 15,000 15,613
6.24% 9/1/23 (AMBAC) 10,000 10,446
Metropolitan Washington District
Columbia Airport Authority
4.62% 10/1/10 15,000 15,557
-----------
41,616
-----------
Public Power Revenue Bonds - 0.05%
Long Island Power Authority Series A
5.00% 6/1/08 5,000 5,497
-----------
5,497
-----------
State General Obligation Bonds - 1.12%
Illinois State Taxable 5.10% 6/12/33 130,000 120,851
-----------
120,851
-----------
Total Municipal Bonds (cost $184,424) 194,401
-----------
- --------------------------------------------------------------------------------
U.S. Treasury Obligations - 39.48%
- --------------------------------------------------------------------------------
U.S. Treasury Bond 6.00% 2/15/26 262,000 298,731
U.S. Treasury Note
1.625% 4/30/05 1,449,000 1,457,943
1.625% 9/30/05 15,000 15,049
2.375% 8/15/06 175,000 177,482
3.125% 9/15/08 235,000 238,341
4.25% 8/15/13 405,000 415,299
5.00% 8/15/11 601,000 657,579
6.125% 8/15/07 838,000 954,797
U.S Treasury Strip - Principal Only
6.75% 8/15/26 50,000 14,748
-----------
Total U.S. Treasury Obligations
(cost $4,174,362) 4,229,969
-----------
5
Statements Optimum Fixed Income Fund
OF NET ASSETS (CONTINUED)
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Preferred Stocks - 0.11%
- --------------------------------------------------------------------------------
*Centaur Funding 9.08% 144A 5 $ 6,083
Host Marriott 10.00% 225 5,614
-----------
Total Preferred Stocks (cost $10,791) 11,697
-----------
Principal
Amount
- --------------------------------------------------------------------------------
Repurchase Agreements - 10.28%
- --------------------------------------------------------------------------------
With BNP Paribas 0.95% 10/1/03
(dated 9/30/03, collateralized
by $396,000 U.S. Treasury Notes
7.25% due 5/15/04, market
value $422,099) $ 413,700 413,700
With J. P. Morgan Securities 0.92%
10/1/03 (dated 9/30/03, collateralized
by $116,800 U.S. Treasury Notes
11.875% due 11/15/03, market
value $123,716 and $153,200
U.S. Treasury Notes 2.125%
due 10/31/04, market value $156,317) 274,400 274,400
With UBS Warburg 0.95% 10/1/03
(dated 9/30/03, collateralized by
$153,200 U.S. Treasury Notes 1.25%
due 5/31/05, market value $153,686
$73,000 U.S. Treasury Notes 10.75%
due 8/15/05, market value $86,571 and
$153,200 U.S. Treasury Notes 9.375% due
2/15/06, market value $182,426) 413,900 413,900
-----------
Total Repurchase Agreements (cost $1,102,000) 1,102,000
-----------
Total Market Value of Securities - 100.93%
(cost $10,640,628) 10,814,574
Liabilities Net of Receivables and
Other Assets - (0.93%) (99,844)
-----------
Net Assets Applicable to 1,221,862 Shares
Outstanding - 100.00% $10,714,730
===========
Net Asset Value - Optimum Fixed Income Fund
Class A ($2,170,252 / 247,452 Shares) $8.77
-----
Net Asset Value - Optimum Fixed Income Fund
Class B ($545,228 / 62,182 Shares) $8.77
-----
Net Asset Value - Optimum Fixed Income Fund
Class C ($3,699,464 / 422,035 Shares) $8.77
-----
Net Asset Value - Optimum Fixed Income Fund
Institutional Class ($4,299,786 / 490,193 Shares) $8.77
-----
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Components of Net Assets at September 30, 2003:
Shares of beneficial interest
(unlimited authorization - no par) $10,498,018
Undistributed net investment income** 22,658
Accumulated net realized gain on investments 19,923
Net unrealized appreciation of investments 174,131
-----------
Total net assets $10,714,730
===========
*Security exempt from registration under Rule 144A of the Securities Act of
1933.
See Note 7 in "Notes to Financial Statements."
**Undistributed net investment income includes net realized gains (losses) on
foreign currencies. Net realized gains (losses) on foreign currencies are
treated as net investment income in accordance with provisions of the
Internal Revenue Code.
+Non-income producing security. Security is currently in default..
++Step coupon bonds
oZero coupon bond. The interest rate shown is the yield at the time of
purchase.
*Principal amount is stated in the currency in which each bond is denominated.
Summary of Abbreviations:
AMBAC - Insured by the AMBAC Indemnity Corporation
AUD - Australian Dollar
EUR - European Monetary Unit
JPY - Japanese Yen
MBIA - Insured by the Municipal Bond Insurance Association
NOK - Norwegian Kroner
PLZ - Polish Zloty
SEK - Swedish Krona
USD - U.S. Dollar
TBA - To be announced
Net Asset Value and Offering Price per Share -
Optimum Fixed Income Fund
Net asset value Class A (A) $8.77
Sales charge (4.50% of offering price, or 4.68% of
amount invested per share) (B) 0.41
-----
Offering price $9.18
=====
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
6
Statements Optimum International Fund
OF NET ASSETS (CONTINUED) September 30, 2003 (Unaudited)
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stock - 92.42%
- --------------------------------------------------------------------------------
Australia - 6.74%
Amcor 7,365 $ 43,370
Coles Myer 7,792 40,083
Foster's Group 25,807 78,080
National Australia Bank 3,066 63,917
Orica 4,240 34,438
Telstra 17,537 56,263
The News Corporation 2,779 91,150
-----------
407,301
-----------
Austria - 0.52%
Erste Bank der Oestereichischen Sparkassen 310 31,354
-----------
31,354
-----------
Belgium - 0.60%
Electrabel 131 36,034
-----------
36,034
-----------
Brazil - 2.10%
Cia de Bebidas das Americas ADR 2,327 50,379
Cia Vale do Rio Doce ADR 766 31,268
Unibanco de Bancos Brasileiros GDR 2,282 45,184
-----------
126,831
-----------
++China - 5.62%
ASM Pacific Technology 8,500 28,758
Cathay Pacific Airways 19,000 32,142
CNOOC ADR 1,589 54,613
Esprit Holdings 16,500 50,179
Hong Kong & China Gas 15,000 20,145
Hong Kong Electric Holdings 11,000 42,402
i-CABLE Communications 1,300 304
*Sohu.com 914 28,425
Sun Hung Kai Properties 6,000 48,620
Wharf Holdings 13,000 33,911
-----------
339,499
-----------
Finland - 0.33%
UPM-Kymmene Oyj 1,200 20,109
-----------
20,109
-----------
France - 4.94%
Compagnie de Saint-Gobain 1,477 54,302
Credit Agricole 2,019 39,336
*JC Decaux 2,250 31,626
Societe Generale 1,156 77,004
Total Class B 638 96,290
-----------
298,558
-----------
Germany - 5.47%
Bayer 2,517 54,227
*Bayerische Hypo-und Vereinsbank 1,116 18,975
Bayerische Motoren Werke 3,145 118,849
RWE 3,198 84,912
SAP 437 53,435
-----------
330,398
-----------
Hungary - 0.56%
+*OPT Bank GDR 144A 1,432 33,956
-----------
33,956
-----------
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
Ireland - 2.64%
*Ryanair Holdings ADR 3,937 $ 159,449
-----------
159,449
-----------
Italy - 1.36%
Banca Intesa 27,086 82,012
-----------
82,012
-----------
Japan - 19.21%
Canon 3,000 146,624
Daiwa Securities 9,000 60,824
Eisai 2,300 53,735
Hitachi 8,000 44,399
Matsushita Electric Industrial 4,000 48,158
Millea Holdings 2 22,557
Mitsui Fudosan 4,000 35,447
Murata Manufacturing 900 46,404
Nissan Motor 8,000 86,292
NTT DoCoMo 13 31,768
Sharp 7,000 102,449
*SKY Perfect Communications 27 32,628
Takeda Chemical Industries 2,100 76,507
THK 2,100 36,129
Toshiba 7,000 29,450
Toyota Motor 1,700 49,913
UFJ Holdings 16 62,874
West Japan Railway 6 23,041
*Yahoo Japan 3 42,429
Yamada Denki 2,200 64,987
Yamaha 3,400 64,369
-----------
1,160,984
-----------
Malaysia - 0.18%
Sime Darby Berhad 8,000 10,842
-----------
10,842
-----------
Mexico - 0.51%
Wal-Mart de Mexico Series V 10,646 30,722
-----------
30,722
-----------
Netherlands - 4.07%
ING Groep 2,577 47,206
Kononkljke Philips Electronics 1,913 43,353
Reed Elsevier 4,097 46,280
Royal Dutch Petroleum 2,486 109,174
-----------
246,013
-----------
New Zealand - 1.04%
Telecom Corporation of New Zealand 20,501 62,831
-----------
62,831
-----------
Norway - 0.52%
*Golar LNG 2,800 31,548
-----------
31,548
-----------
Russia - 1.10%
Mobile Telesyatems ADR 900 66,195
-----------
66,195
-----------
Singapore - 1.06%
Jardine Matheson Holdings 4,400 31,680
Oversea-Chinese Banking 5,000 32,397
-----------
64,077
-----------
7
Statements Optimum International Fund
OF NET ASSETS (CONTINUED)
Principal Market
Amount Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
South Africa - 0.93%
Sasol 4,688 $ 56,000
-----------
56,000
-----------
South Korea - 2.28%
POSCO ADR 1,700 48,620
+Samsung Electronics GDR 144A 524 89,296
-----------
137,916
-----------
Spain - 4.81%
Banco Santander Central Hispano 6,535 55,403
Corporacion Mapfre 2,830 30,880
Iberdrola 2,876 48,397
*Sogecable 2,450 58,917
*Telefonica 8,193 96,748
-----------
290,345
-----------
Switzerland - 5.75%
Roche Holding 1,466 121,556
Synthes-Stratec 53 46,956
UBS 2,176 122,098
Zurich Financial Services 452 56,474
-----------
347,084
-----------
Taiwan - 1.30%
*Taiwan Semiconductors Manufacturing ADR 7,252 78,539
-----------
78,539
-----------
United Kingdom - 16.66%
Aviva 4,926 38,342
BG Group 12,482 52,518
Boots Group 6,556 70,472
Brambles Industries 13,871 39,119
*British Airways 8,630 23,908
*British Sky Broadcasting 5,950 60,795
EMI Group 34,240 83,765
GKN 5,300 21,199
GlaxoSmithKline 4,140 85,909
GUS 6,425 70,238
HBOS 5,723 65,464
HSBC Holdings 8,658 114,213
Intercontinental Hotels Group 5,299 42,390
Lloyds TSB Group 10,078 69,318
*Marconi 5,369 40,363
*Mitchells & Butlers 5,855 22,398
Rio Tinto 2,127 45,445
Royal Bank of Scotland Group 2,367 60,246
-----------
1,006,102
-----------
United States - 2.12%
iShares MSCI Taiwan Index Fund 2,757 30,299
*NTL 1,323 62,340
*Wynn Resorts 1,934 35,160
-----------
127,799
-----------
Total Common Stock (cost $5,449,097) 5,582,498
-----------
Principal Market
Amount Value (U.S.$)
- --------------------------------------------------------------------------------
Repurchase Agreements - 13.11%
- --------------------------------------------------------------------------------
With BNP Paribas 0.95% 10/1/03
(dated 9/30/03, collateralized by
$284,650 U.S. Treasury Notes 7.25%
due 5/15/04, market value $303,359) $ 297,350 $ 297,350
With J. P. Morgan Securities 0.92% 10/1/03
(dated 9/30/03, collateralized by
$83,900 U.S. Treasury Notes 11.875%
due 11/15/03, market value $88,914 and
$110,100 U.S. Treasury Notes 2.125%
due 10/31/04, market value $112,344) 197,300 197,300
With UBS Warburg 0.95% 10/1/03
(dated 9/30/03, collateralized by
$110,150 U.S. Treasury Notes 1.25%
due 5/31/05, market value $110,453 and
$52,450 U.S. Treasury Notes 10.75%
due 8/15/05, market value $62,218 and
$110,150 U.S. Treasury Notes 9.375% due
2/15/06, market value $131,109) 297,350 297,350
-----------
Total Repurchase Agreements
(cost $792,000) 792,000
-----------
Total Market Value of Securities - 105.53%
(cost $6,241,097) 6,374,498
Liabilities Net of Receivables and Other
Assets - (5.53%) (333,756)
-----------
Net Assets Applicable to 685,520 Shares
Outstanding - 100.00% $ 6,040,742
===========
Net Asset Value - Optimum International Fund
Class A ($612,372 / 69,503 Shares) $8.81
-----
Net Asset Value - Optimum International Fund
Class B ($86,947 / 9,880 Shares) $8.80
-----
Net Asset Value - Optimum International Fund
Class C ($1,020,564 / 115,944 Shares) $8.80
-----
Net Asset Value - Optimum International Fund
Institutional Class ($4,320,859 / 490,193 Shares) $8.81
-----
8
Statements Optimum International Fund
OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Components of Net Assets at September 30, 2003:
Shares of beneficial interest
(unlimited authorization - no par) $5,907,152
Undistributed net investment income** 7,329
Accumulated net realized loss on investments (5,574)
Net unrealized appreciation of investments 131,835
----------
Total net assets $6,040,742
==========
*Non-income producing security for the period ended September 30, 2003.
**Undistributed net investment income includes net realized gains (losses) on
foreign currencies. Net realized gains (losses) on foreign currencies are
treated as net investment income in accordance with provisions of the
Internal Revenue Code.
+Securities exempt from registration under Rule 144A of the Securities Act of
1933.
See Note 7 in "Notes to Financial Statements."
++Securities listed and traded on the Hong Kong Stock Exchange.
Summary of Abbreviations:
ADR - American Depositary Receipts
GDR - Global Depositary Receipts
Net Asset Value and Offering Price per Share -
Optimum International Fund
Net asset value Class A (A) $8.81
Sales charge (5.75% of offering price, or 6.13% of
the amount invested per share) (B) 0.54
-----
Offering price $9.35
=====
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
9
Statements Optimum Large Cap Growth Fund
OF NET ASSETS (CONTINUED) September 30, 2003 (Unaudited)
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stocks - 85.75%
- --------------------------------------------------------------------------------
Aerospace & Defense - 0.81%
Honeywell International 408 $ 10,751
Lockheed Martin 1,288 59,441
-----------
70,192
-----------
Airlines - 1.96%
*Jetblue Airways 1,797 109,922
*Ryanair Holdings ADR 1,474 59,697
-----------
169,619
-----------
Automobiles & Automotive Parts - 1.13%
Bayerische Motoren Werke 1,500 56,684
Danaher 550 40,623
-----------
97,307
-----------
Banking & Finance - 13.37%
Charles Schwab 1,500 17,865
Citigroup 6,220 283,071
Credit Suisse Group 600 19,196
Fannie Mae 2,728 191,506
Freddie Mac 500 26,175
Goldman Sachs Group 365 30,624
Mellon Financial 1,400 42,196
Merrill Lynch 2,897 155,076
Morgan Stanley 600 30,276
Northern Trust 900 38,196
SLM 5,333 207,774
State Street Bank 1,260 56,700
US Bancorp 1,900 45,581
Wells Fargo 200 10,300
-----------
1,154,536
-----------
Business Services - 2.15%
*Accenture 1,600 35,744
Adecco 450 22,234
*Apollo Group Class A 680 44,900
*Cendant 2,000 37,380
Compass Group 5,300 30,555
Paychex 250 8,483
Securitas 500 6,076
-----------
185,372
-----------
Cable, Media & Publishing - 6.49%
*AOL Time Warner 2,050 30,976
Clear Channel Communications 1,750 67,025
*Comcast Special Class A 1,850 54,649
*EchoStar Communications Class A 3,129 119,747
*Liberty Media Class A 4,000 39,880
Omnicom Group 300 21,555
Scripps (E.W.) 360 30,636
*Univision Communications Class A 1,250 39,913
Viacom Class B 3,436 131,598
Walt Disney 1,194 24,083
-----------
560,062
-----------
Computers & Technology - 4.34%
*Affiliated Computer Services Class A 1,200 58,428
*Dell 5,698 190,256
*EMC 6,930 87,526
Seagate Technology Holdings 650 17,680
*SunGard Data Systems 800 21,048
-----------
374,938
-----------
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stocks (continued)
- --------------------------------------------------------------------------------
Consumer Products - 0.83%
Gillete 550 $ 17,589
Tyco International 2,650 54,140
-----------
71,729
-----------
Consumer Services/Entertainment & Leisure - 0.85%
Harley-Davidson 1,515 73,023
-----------
73,023
-----------
Electronics & Electrical Equipment - 2.37%
General Electric 6,568 195,792
Koninklijke Philips Electronics 400 9,065
-----------
204,857
-----------
Energy - 1.83%
Baker Hughes 1,300 38,467
ChevronTexaco 550 39,298
Exxon Mobil 1,000 36,600
Schlumberger 900 43,560
-----------
157,925
-----------
Food, Beverage & Tobacco - 2.29%
Altria Group 900 39,420
Coca-Cola 950 40,811
General Mills 500 23,535
PepsiCo 450 20,624
*Starbucks 900 25,920
Sysco 900 29,439
Unilever 2,100 17,951
-----------
197,700
-----------
Healthcare & Pharmaceuticals - 15.21%
Abbott Laboratories 840 35,742
*Amgen 2,407 155,419
Baxter International 300 8,718
Biomet 650 21,847
*Biovail 550 20,433
*Boston Scientific 1,809 115,413
Cardinal Health 300 17,517
*Caremark Rx 3,088 69,789
Eli Lilly 50 2,970
*Forest Laboratories 390 20,066
*Genentech 1,400 112,196
*Gilead Sciences 530 29,643
HCA 600 22,116
Johnson & Johnson 1,100 54,472
*Medco Health Solutions 600 15,558
*Medimmune 350 11,554
Medtronic 350 16,422
Pfizer 3,600 109,368
Sanofi-Synthelabo 300 18,237
UnitedHealth Group 5,405 271,979
*WellPoint Health Networks 600 46,248
Wyeth 700 32,270
*Zimmer Holdings 1,920 105,792
-----------
1,313,769
-----------
Home Builders - 0.85%
Lennar 938 72,967
-----------
72,967
-----------
10
Statements Optimum Large Cap Growth Fund
OF NET ASSETS (CONTINUED)
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stocks (continued)
- --------------------------------------------------------------------------------
Industrial Machinery - 1.17%
Caterpillar 1,468 $ 101,057
-----------
101,057
-----------
Insurance - 2.71%
ACE Limited 800 26,464
American International Group 1,650 95,205
Hartford Financial Services 750 39,473
Marsh & McLennan 800 38,088
Travelers Property Casualty Class A 1,950 30,966
XL Capital Limited Class A 50 3,872
-----------
234,068
-----------
Internet Services - 1.89%
*eBay 1,017 54,206
*InterActiveCorp 1,100 36,355
*Monster Worldwide 1,235 31,097
*Symantec 300 18,906
*Yahoo 650 22,997
-----------
163,561
-----------
Leisure, Lodging & Entertainment - 0.82%
Carnival 1,150 37,823
*MGM Mirage 550 20,103
*Wynn Resorts 701 12,744
-----------
70,670
-----------
Metals & Mining - 0.24%
Nucor 450 20,646
-----------
20,646
-----------
Retail - 8.21%
*Best Buy 600 28,512
Home Depot 1,850 58,923
Inditex 700 14,999
*Kohl's 350 18,725
Lowe's 2,306 119,681
Sears, Roebuck 2,286 99,967
Target 2,100 79,023
Tiffany 2,650 98,925
Wal-Mart de Mexico ADR 800 23,086
Wal-Mart de Mexico Series V 1,700 4,906
Wal-Mart Stores 2,408 134,486
Walgreen 900 27,576
-----------
708,809
-----------
Technology/Semiconductors - 3.38%
*Analog Devices 600 22,812
*Applied Materials 1,750 31,745
*ASML Holding 600 7,861
Intel 7,349 202,171
Maxim Integrated Products 350 13,825
Texas Instruments 600 13,680
-----------
292,094
-----------
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stocks (continued)
- --------------------------------------------------------------------------------
Technology/Software - 5.98%
Adobe Systems 550 $ 21,593
*Electronics Arts 1,298 119,715
First Data 2,500 99,900
*Fiserv 1,300 47,099
International Game Technology 1,250 35,188
*Intuit 850 41,004
Microsoft 5,000 138,949
*Siebel Systems Software 1,300 12,636
-----------
516,084
-----------
Telecommunications - 5.11%
*Cisco Systems 9,355 182,796
*Crown Castle International 1,900 17,879
*Nextel Communications Class A 2,450 48,241
NTT DoCoMo 1 2,444
QUALCOMM 2,444 101,768
Vodafone Group 28,600 57,138
Vodafone Group ADR 1,550 31,388
-----------
441,654
-----------
Textiles, Apparel & Furniture - 0.24%
Hermes International 135 20,878
-----------
20,878
-----------
Transportation & Shipping - 1.52%
Fedex 1,845 118,873
United Parcel Service Class B 190 12,122
-----------
130,995
-----------
Total Common Stock (cost $7,408,246) 7,404,512
-----------
Principal
Amount
- --------------------------------------------------------------------------------
Repurchase Agreements - 14.11%
- --------------------------------------------------------------------------------
With BNP Paribas 0.95% 10/1/03
(dated 9/30/03, collateralized by
$438,000 U.S. Treasury Notes 7.25%
due 5/15/04, market value $466,530) $457,000 457,000
With J. P. Morgan Securities 0.92% 10/1/03
(dated 9/30/03, collateralized by
$129,000 U.S. Treasury Notes 11.875%
due 11/15/03, market value $136,739 and
$169,000 U.S. Treasury Notes 2.125%
due 10/31/04, market value $172,771) 303,000 303,000
With UBS Warburg 0.95% 10/1/03
(dated 9/30/03, collateralized by
$169,369 U.S. Treasury Notes 1.25%
due 5/31/05, market value $169,863 and
$81,000 U.S. Treasury Notes 10.75%
due 8/15/05, market value $95,684 and
$169,000 U.S. Treasury Notes 9.375% due
2/15/06, market value $201,629) 458,000 458,000
-----------
Total Repurchase Agreements
(cost $1,218,000) 1,218,000
-----------
11
Statements Optimum Large Cap Growth Fund
OF NET ASSETS (CONTINUED)
Total Market Value of Securities - 99.86%
(cost $8,626,246) $8,622,512
Receivables and Other Assets
Net of Liabilities - 0.14% 12,309
----------
Net Assets Applicable to 999,819 Shares
Outstanding - 100.00% $8,634,821
----------
Net Asset Value - Optimum Large Cap Growth Fund
Class A ($1,473,537 / 170,605 Shares) $8.64
-----
Net Asset Value - Optimum Large Cap Growth Fund
Class B ($264,433 / 30,648 Shares) $8.63
-----
Net Asset Value - Optimum Large Cap Growth Fund
Class C ($2,660,957 / 308,373 Shares) $8.63
-----
Net Asset Value - Optimum Large Cap Growth Fund
Institutional Class ($4,235,894 / 490,193 Shares) $8.64
-----
Components of Net Assets at September 30, 2003:
Shares of beneficial interest
(unlimited authorization - no par) $8,646,343
Net investment loss** (4,818)
Accumulated net realized loss on investments (2,633)
Net unrealized depreciation of investment (4,071)
----------
Total net assets $8,634,821
==========
*Non-income producing security for the period ended September 30, 2003.
Net investment loss includes net realized gains(losses) on foreign
currencies. Net realized gains(losses) on foreign currencies are treated as
net investment income in accordance with provisions of the Internal Revenue
Code.
Summary of Abbreviations:
ADR - American Depositary Receipts
Net Asset Value and Offering Price per Share -
Optimum Large Cap Growth Fund
Net asset value Class A (A) $8.64
Sales charge (5.75% of offering price, or 6.13% of the
amount invested per share) (B) 0.53
-----
Offering price $9.17
=====
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
12
Statements Optimum Large Cap Value Fund
of net assets (continued) September 30, 2003 (Unaudited)
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stock - 93.44%
- --------------------------------------------------------------------------------
Aerospace & Defense - 0.56%
Northrop Grumman 10,380 $ 32,764
Raytheon 560 15,680
-----------
48,444
-----------
Automobiles & Automotive Parts - 1.09%
Honda Motor ADR 2,540 51,206
Magna International Class A 600 43,290
-----------
94,496
-----------
Banking, Finance & Insurance - 18.40%
American Express 1,060 47,764
Bank of America 3,635 283,676
Bank One 780 30,147
Citigroup 5,580 253,945
Edwards (A.G.) 870 33,417
Equifax 3,160 70,373
Fannie Mae 1,550 108,810
FleetBoston Financial 4,160 125,424
Goldman Sachs Group 1,050 88,095
JP Morgan Chase 2,200 75,526
Mellon Financial 2,780 83,789
Merrill Lynch 2,780 148,813
PNC Financial Series Group 1,370 65,185
SouthTrust 560 16,458
SunTrust Banks 1,540 92,970
Wachovia 1,640 67,552
-----------
1,591,944
-----------
Basic Industry/Capital Goods - 0.88%
Caterpillar 240 16,522
Deere 1,125 59,973
-----------
76,495
-----------
Cable, Media & Publishing - 6.53%
*AOL Time Warner 10,490 158,503
*Comcast Special Class A 1,400 41,356
*Cox Communications Class A 1,630 51,541
Interpublic Group 2,380 33,606
Knight-Ridder 320 21,344
Reed Elsevier 6,110 47,761
Tribune 1,330 61,047
Viacom 1,810 69,323
Walt Disney 4,010 80,882
-----------
565,363
-----------
Chemicals - 3.15%
Air Products & Chemicals 1,090 49,159
Dow Chemical 2,600 84,604
duPont (E.I.) deNemours 610 24,406
PPG Industries 1,160 60,575
Praxair 210 13,010
Syngenta 750 40,663
-----------
272,417
-----------
Computers & Technology - 2.21%
*Computer Sciences 330 12,398
Hewlett-Packard 3,330 64,469
International Business Machines 1,290 113,946
-----------
190,813
-----------
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
Consumer Products - 2.20%
Kimberly-Clark 3,230 $ 165,763
Newell Rubbermaid 510 11,052
Procter & Gamble 145 13,459
-----------
190,274
-----------
Electronics & Electrical Equipment - 1.28%
Emerson Electric 820 43,173
NSTAR 660 31,350
Parker Hannifin 820 36,654
-----------
111,177
-----------
Energy - 13.38%
Anadarko Petroleum 660 27,562
Baker Hughes 750 22,193
BP ADR 4,950 208,395
ChevronTexaco 540 38,583
ConocoPhillips 2,660 145,635
Devon Energy 310 14,939
ENSCO International 1,630 43,717
EOG Resources 1,150 48,001
Exxon Mobil 6,050 221,429
National Fuel Gas 920 21,022
*Noble 1,090 37,049
Schlumberger 3,380 163,592
Total ADR 450 34,110
*Transocean 2,010 40,200
Unocal 1,650 52,008
Valero Energy 1,000 38,270
-----------
1,156,705
-----------
Farming & Agriculture - 0.17%
Monsanto 630 15,082
-----------
15,082
-----------
Food, Beverage & Tobacco - 5.88%
Altria Group 3,250 142,349
Archer-Daniels-Midland 4,560 59,782
Diageo 2,530 27,322
Heinz (H.J.) 1,120 38,394
Hormel Foods 200 4,596
Kellogg Company 2,650 88,377
Kraft Foods Class A 860 25,370
*Kroger 1,850 33,060
PepsiCo 1,520 69,661
*Safeway 300 6,882
Tyson Food Class A 930 13,141
-----------
508,934
-----------
Healthcare & Pharmaceuticals - 9.04%
Abbott Laboratories 530 22,552
Aetna 400 24,412
AstraZeneca ADR 770 33,418
Bristol-Myers Squibb 7,690 197,325
Guidant 300 14,055
Johnson & Johnson 1,360 67,347
Novartis 1,260 48,755
Pfizer 3,010 91,444
Roche Holding 530 43,946
Roche Holding ADR 860 71,307
Schering-Plough 8,060 122,834
*Tenet Healthcare 3,120 45,178
-----------
782,573
-----------
13
Statements Optimum Large Cap Value Fund
OF NET ASSETS (CONTINUED)
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
Healthcare Equipment & Supplies - 0.69%
Bausch & Lomb 1,350 $ 59,603
-----------
59,603
-----------
Industrial - 1.32%
3M 360 24,865
Ingersoll-Rand 880 47,027
Textron 1,070 42,212
-----------
114,104
-----------
Insurance - 7.17%
Allstate 1,360 49,681
Chubb 2,350 152,468
Hartford Financial Services 2,370 124,733
MetLife 3,550 99,578
Prudential Financial 1,520 56,787
St. Paul 190 7,036
Travelers Property & Casualty 8,180 129,898
-----------
620,181
-----------
Leisure, Lodging & Entertainment - 1.66%
Hasbro 490 9,153
Hilton Hotels 4,410 71,530
Starwood Hotels & Resorts Worldwide 1,810 62,988
-----------
143,671
-----------
Metals & Mining - 1.79%
Alcoa 210 5,494
BHP Billiton 2,060 13,664
Newmont Mining 1,100 42,999
*Phelps Dodge 1,350 63,180
Rio Tinto 1,370 29,271
-----------
154,608
-----------
Packaging & Containers - 0.24%
*Smurfit-Stone Container 1,390 20,822
-----------
20,822
-----------
Paper & Forest Products - 1.17%
Bowater 460 19,348
International Paper 810 31,606
Temple-Inland 1,040 50,492
-----------
101,446
-----------
Restaurants - 0.69%
McDonald's 2,530 59,556
-----------
59,556
-----------
Retail - 1.31%
Sears, Roebuck 660 28,862
Target 580 21,825
Wal-Mart Stores 1,120 62,552
-----------
113,239
-----------
Technology/Semiconductors - 0.26%
Texas Instruments 990 22,572
-----------
22,572
-----------
Technology/Software - 1.84%
Automatic Data Processing 1,140 40,869
Microsoft 4,270 118,663
-----------
159,532
-----------
Number of Market
Shares Value (U.S.$)
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
Telecommunications - 4.33%
BellSouth 2,670 $ 63,226
Motorola 3,800 45,486
Nokia ADR 2,500 39,000
*Nortel Networks 4,160 17,056
SBC Communications 2,900 64,525
Sprint 1,690 25,519
Verizon Communications 3,690 119,703
-----------
374,515
-----------
Transportation & Shipping - 2.01%
Norfolk Southern 3,880 71,780
Union Pacific 1,750 101,798
-----------
173,578
-----------
Utilities - 4.19%
AGL Resources 310 8,733
*Edison International 1,650 31,515
Energy East 1,220 27,365
Entergy 1,300 70,394
Exelon 740 46,990
FirstEnergy 1,360 43,384
FPL Group 310 19,592
KeySpan 530 18,592
PPL 1,260 51,597
TXU 1,450 34,162
WGL Holdings 370 10,205
-----------
362,529
-----------
Total Common Stock (cost $8,102,290) 8,084,673
-----------
- --------------------------------------------------------------------------------
Convertible Preferred Stock - 0.03%
- --------------------------------------------------------------------------------
Northrop Grumman 7.25% 30 2,934
-----------
Total Convertible Preferred Stock (cost $3,124) 2,934
-----------
Principal
Amount
- --------------------------------------------------------------------------------
Repurchase Agreements - 12.35%
- --------------------------------------------------------------------------------
With BNP Paribas 0.95% 10/1/03
(dated 9/30/03, collateralized by
$384,000 U.S. Treasury Notes 7.25%
due 5/15/04, market value $409,459) $401,250 401,250
With J. P. Morgan Securities 0.92%
10/1/03 (dated 9/30/03, collateralized
by $113,250 U.S. Treasury Notes 11.875%
due 11/15/03, market value $120,011 and
$148,500 U.S. Treasury Notes 2.125%
due 10/31/04, market value $151,636) 266,250 266,250
With UBS Warburg 0.95% 10/1/03
(dated 9/30/03, collateralized by
$148,500 U.S. Treasury Notes 1.25%
due 5/31/05, market value $149,084 and
$71,000 U.S. Treasury Notes 10.75%
due 8/15/05, market value $83,978 and
$148,500 U.S. Treasury Notes 9.375% due
2/15/06, market value $176,500) 401,500 401,500
-----------
Total Repurchase Agreements
(cost $1,069,000) 1,069,000
-----------
14
Statements Optimum Large Cap Value Fund
OF NET ASSETS (CONTINUED)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Total Market Value of Securities - 105.82%
(cost $9,174,414) $ 9,156,607
Liabilities Net of Receivables and Other
Assets - (5.82%) (503,249)
-----------
Net Assets Applicable to 1,005,056 Shares
Outstanding - 100.00% $ 8,653,358
===========
Net Asset Value - Optimum Large Cap Value Fund
Class A ($1,473,125 / 171,084 Shares) $8.61
-----
Net Asset Value - Optimum Large Cap Value Fund
Class B ($261,875 / 30,439 Shares) $8.60
-----
Net Asset Value - Optimum Large Cap Value Fund
Class C ($2,695,444 / 313,340 Shares) $8.60
-----
Net Asset Value - Optimum Large Cap Value Fund
Institutional Class ($4,222,914 / 490,193 Shares) $8.61
-----
Components of Net Assets at September 30, 2003:
Shares of beneficial interest
(unlimited authorization - no par) $8,653,960
Undistributed net investment income** 8,082
Accumulated net realized gain on investments 9,187
Net unrealized depreciation of investments (17,871)
----------
Total net assets $8,653,358
==========
*Non-income producing security for the period ended September 30, 2003.
**Undistributed net investment income includes net realized gains(losses) on
foreign currencies. Net realized gains(losses) on foreign currencies are
treated as net investment income in accordance with provisions of the
Internal Revenue Code.
Summary of Abbreviations:
ADR - American Depositary Receipts
Net Asset Value and Offering Price per Share -
Optimum Large Cap Value Fund
Net asset value Class A (A) $8.61
Sales charge (5.75% of offering price, or 6.16% of
the amount invested per share) (B) 0.53
-----
Offering price $9.14
=====
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
15
Statements Optimum Small Cap Growth Fund
OF NET ASSETS (CONTINUED) September 30, 2003 (Unaudited)
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock - 89.10%
- --------------------------------------------------------------------------------
Banking & Finance - 9.03%
*Americredit 22,500 $ 231,750
TCF Financial 2,800 134,260
*World Acceptance 8,500 115,175
-----------
481,185
-----------
Business Services - 4.94%
*Andrew 11,000 135,190
*First Health Group 4,900 128,135
-----------
263,325
-----------
Cable, Media & Publishing - 3.75%
*Mediacom Communications 13,600 91,120
*Salem Communications Class A 5,600 108,584
-----------
199,704
-----------
Chemicals - 2.47%
*Scotts 2,400 131,280
-----------
131,280
-----------
Computers & Technology - 23.20%
*Avocent 4,600 139,334
*E.Piphany 21,900 109,281
*JDA Software Group 8,600 127,882
*Kronos 2,300 121,693
*Micros Systems 3,700 126,355
Ndchealth 6,300 131,985
*Novell 35,400 188,682
*PeopleSoft 7,500 136,425
*SeaChange International 12,300 154,119
-----------
1,235,756
-----------
Consumer Services - 2.43%
Global Payment 3,600 129,600
-----------
129,600
-----------
Energy - 5.75%
*Quicksilver Resources 7,400 180,782
Western Gas Resources 3,300 125,400
-----------
306,182
-----------
Environmental Services - 2.50%
*Cuno Incorporated 3,400 133,246
-----------
133,246
-----------
Healthcare & Pharmaceuticals - 15.99%
*CTI Molecular Imaging 9,000 132,930
Diagnostic Products 3,300 119,889
*Edwards Lifesciences 6,000 162,480
*Lincare Holdings 3,500 128,275
*Nektar Therapeutics 14,400 184,320
*Techne 3,900 123,981
-----------
851,875
-----------
Insurance - 4.80%
HCC Insurance Holdings 4,200 122,136
*Markel 500 133,500
-----------
255,636
-----------
Retail - 2.22%
Christopher & Banks 4,950 118,107
-----------
118,107
-----------
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
Telecommunications - 10.13%
*American Tower Class A 13,400 $ 136,010
*Commonwealth Telephone 3,200 128,416
*Crown Castle 13,000 122,330
*Western Wireless Class A 8,200 152,848
-----------
539,604
-----------
Utilities - 1.89%
Oneok 5,000 100,850
-----------
100,850
-----------
Total Common Stock (cost $4,518,162) 4,746,350
-----------
Principal
Amount
- --------------------------------------------------------------------------------
Repurchase Agreements - 11.73%
- --------------------------------------------------------------------------------
With BNP Paribas 0.95% 10/1/03
(dated 9/30/03, collateralized by
$224,600 U.S. Treasury Notes 7.25%
due 5/15/04, market value $239,394) $234,600 234,600
With J. P. Morgan Securities 0.92% 10/1/03
(dated 9/30/03, collateralized by
$66,300 U.S. Treasury Notes 11.875% due
11/15/03, market value $70,166 and
$86,900 U.S. Treasury Notes 2.125%
due 10/31/04, market value $88,655) 155,600 155,600
With UBS Warburg 0.95% 10/1/03
(dated 9/30/03, collateralized by
$86,900 U.S. Treasury Notes 1.25%
due 5/31/05, market value $87,163 and
$41,400 U.S. Treasury Notes 10.75%
due 8/15/05, market value $49,099 and
$86,900 U.S. Treasury Notes 9.375% due
2/15/06, market value $103,463) 234,800 234,800
-----------
Total Repurchase Agreements (cost $625,000) 625,000
-----------
Total Market Value of Securities - 100.83%
(cost $5,143,162) 5,371,350
Liabilities Net of Receivables and Other
Assets - (0.83%) (44,518)
-----------
Net Assets Applicable to 591,886 Shares
Outstanding - 100.00% $5,326,832
-----------
Net Asset Value - Optimum Small Cap Growth Fund
Class A ($310,086 / 34,463 Shares) $9.00
-----
Net Asset Value - Optimum Small Cap Growth Fund
Class B ($50,550 / 5,619.7 Shares) $9.00
-----
Net Asset Value - Optimum Small Cap Growth Fund
Class C ($554,262 / 61,610 Shares) $9.00
-----
Net Asset Value - Optimum Small Cap Growth Fund
Institutional Class ($4,411,934 / 490,193 Shares) $9.00
-----
16
Statements Optimum Small Cap Growth Fund
OF NET ASSETS (CONTINUED)
Components of Net Assets at September 30, 2003:
Shares of beneficial interest
(unlimited authorization - no par) $5,107,857
Net investment loss (9,213)
Net unrealized appreciation of investments 228,188
----------
Total net assets $5,326,832
----------
*Non-income producing security for the period ended September 30, 2003.
Net Asset Value and Offering Price per Share -
Optimum Small Cap Growth Fund
Net asset value Class A (A) $9.00
Sales charge (5.75% of offering price, or 6.11% of
amount invested per share) (B) 0.55
-----
Offering price $9.55
-----
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares. (B) See the current
prospectus for purchases of $50,000 or more.
See accompanying notes
17
Statements Optimum Small Cap Value Fund
OF NET ASSETS (CONTINUED) September 30, 2003 (Unaudited)
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock - 78.42%
- --------------------------------------------------------------------------------
Aerospace & Defense - 2.55%
*Esterline Technologies 3,300 $ 63,657
Honeywell International 2,700 71,145
---------
134,802
---------
Airlines - 1.85%
*Airtran Holdings 3,300 55,275
*Atlantic Coast Airlines 5,000 42,550
---------
97,825
---------
Banking & Finance - 0.49%
Klamath First Bancorp 1,200 25,980
---------
25,980
---------
Business Services - 2.54%
Harland (John H.) Company 1,400 37,058
*Moore Wallace 3,500 49,700
Viad 2,000 47,760
---------
134,518
---------
Chemicals - 4.95%
Agrium 2,300 28,888
Celanese AG 800 26,424
Englehard 3,000 83,010
*FMC 2,100 52,920
IMC Global 3,500 22,435
*Pioneer Natural Resources 1,900 48,374
---------
262,051
---------
Commercial Services & Supplies - 6.57%
Bowne & Company 4,500 67,275
*Heidrick & Struggles 3,900 66,027
Kelly Services 2,500 62,350
*Spherion 7,800 54,288
*Valassis Communications 3,700 97,680
---------
347,620
---------
Computers & Technology - 1.84%
*Filenet 1,700 34,119
*Optimal Robotics Class A 3,300 27,918
*Unisys 2,600 35,178
---------
97,215
---------
Consumer Durables - 7.39%
*Beazer Homes USA 1,300 109,720
Brookfield Homes 3,900 72,267
*Furniture Brands International 5,000 120,500
*Toll Brothers 2,900 88,218
---------
390,705
---------
Consumer Non-Durable/Other - 0.93%
*International Multifoods 2,100 49,035
---------
49,035
---------
Consumer Products - 5.78%
*BJ's Wholesale Club 2,300 44,551
*Pathmark Stores 4,500 31,365
*Proquest 2,500 65,750
Readers Digest Association Class A 1,700 23,783
Stanley Works 2,500 73,800
Walter Industries 6,200 66,526
---------
305,775
---------
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
Electronics & Electrical Equipment - 1.67%
Acuity Brands 1,200 $ 21,672
*Mettler-Toledo International 900 32,355
Thomas Industries 1,200 34,224
---------
88,251
---------
Energy - 1.27%
*Stelmar Shipping 2,400 42,000
Teekay Shipping 600 25,380
---------
67,380
---------
Healthcare & Pharmaceuticals - 1.23%
*Thermo Electron 3,000 65,100
---------
65,100
---------
Healthcare Equipment & Supplies - 3.31%
*Apogent Technologies 3,000 62,580
Bausch & Lomb 900 39,735
*Rotech Healthcare 3,000 72,750
---------
175,065
---------
Healthcare/Services - 1.54%
*LifePoint Hospitals 2,100 50,505
*US Oncology 4,200 30,702
---------
81,207
---------
Hotels, Restaurants & Leisure - 3.72%
*Isle of Capri Casinos 1,200 23,772
*Jack in the Box 600 10,680
*LA Quinta 3,100 19,313
Lone Star Steakhouse & Saloon 2,900 60,610
*Magna Entertainment Class A 1,700 7,072
Mandalay Resorts Group 1,900 75,259
---------
196,706
---------
Industrial Machinery - 5.89%
Ametek 600 25,716
*Flowserve 2,300 46,690
*Joy Global 2,600 40,820
Kennametal 2,200 82,280
Manitowoc 2,000 43,380
*MSC Industrial Direct Class A 1,100 22,935
*Team 6,100 49,715
---------
311,536
---------
Insurance - 2.48%
*Allmerica Financial 5,500 130,955
---------
130,955
---------
Metals & Mining - 0.58%
*Material Sciences 3,000 30,660
---------
30,660
---------
Real Estate - 7.00%
AMB Property 1,000 30,810
American Financial Realty 3,400 47,940
Ardent Realty Group 1,000 27,920
Friedman Billings Ramsey Class A 2,900 50,025
LNR Property 2,600 106,470
*MI Developments Class A 4,000 90,800
The St. Joe Company 500 16,040
---------
370,005
---------
18
Statements Optimum Small Cap Value Fund
OF NET ASSETS (CONTINUED)
Number of Market
Shares Value
- --------------------------------------------------------------------------------
Common Stock (continued)
- --------------------------------------------------------------------------------
Retail - 4.27%
Foot Locker 7,100 $ 115,020
*Genesco 2,500 40,150
Radioshack 1,600 45,456
*Stage Stores 1,000 25,480
----------
226,106
----------
Technology/Services - 0.90%
*Bearingpoint 6,000 47,880
----------
47,880
----------
Technology/Software - 1.43%
*Activision 2,900 34,655
*Compuware 4,500 24,120
*Parametric Technology 5,400 16,848
----------
75,623
----------
Telecommunications - 0.27%
*Metrocall 100 14,500
----------
14,500
----------
Textiles, Apparel & Furniture - 3.92%
Jones Apparel Group 1,800 53,874
Russell 2,900 47,270
*Warnaco Group Class A 6,800 106,012
----------
207,156
----------
Transportation & Shipping - 1.97%
Alexander & Baldwin 1,200 33,696
USF 1,100 34,617
*Yellow Corporation 1,200 35,856
----------
104,169
----------
Utilities - 2.08%
Alliant Energy 1,900 41,800
Northeast Utilities 3,800 68,096
----------
109,896
----------
Total Common Stock (cost $4,029,046) 4,147,721
----------
Principal
Amount
- --------------------------------------------------------------------------------
Repurchase Agreements - 22.82%
- --------------------------------------------------------------------------------
With BNP Paribas 0.95% 10/1/03
(dated 9/30/03, collateralized by
$433,800 U.S. Treasury Notes 7.25%
due 5/15/04, market value $462,317) $453,200 453,200
With J. P. Morgan Securities 0.92% 10/1/03
(dated 9/30/03, collateralized by
$128,000 U.S. Treasury Notes 11.875%
due 11/15/03, market value $135,504 and
$167,800 U.S. Treasury Notes 2.125%
due 10/31/04, market value $171,211) 300,600 300,600
With UBS Warburg 0.95% 10/1/03
(dated 9/30/03, collateralized by
$167,800 U.S. Treasury Notes 1.25%
due 5/31/05, market value $168,329 and
$80,000 U.S. Treasury Notes 10.75%
due 8/15/05, market value $94,819 and
$167,800 U.S. Treasury Notes 9.375% due
2/15/06, market value $199,808) 453,200 453,200
----------
Total Repurchase Agreements (cost $1,207,000) 1,207,000
----------
Total Market Value of Securities - 101.24%
(cost $5,236,046) $5,354,721
Liabilities Net of Receivables and Other
Assets - (1.24%) (65,628)
----------
Net Assets Applicable to 597,634 Shares
Outstanding - 100.00% $5,289,093
----------
Net Asset Value - Optimum Small Cap Value Fund
Class A ($322,721 / 36,471 Shares) $8.85
-----
Net Asset Value - Optimum Small Cap Value Fund
Class B ($55,474 / 6,272 Shares) $8.84
-----
Net Asset Value - Optimum Small Cap Value Fund
Class C ($572,239 / 64,698 Shares) $8.84
-----
Net Asset Value - Optimum Small Cap Value Fund
Institutional Class ($4,338,659 / 490,193 Shares) $8.85
-----
Components of Net Assets at September 30, 2003:
Shares of beneficial interest
(unlimited authorization - no par) $5,132,478
Net investment loss (2,511)
Accumulated net realized gain on investments 40,451
Net unrealized appreciation of investments 118,675
----------
Total net assets $5,289,093
----------
*Non-income producing security for the period ended September 30, 2003.
Net Asset Value and Offering Price per Share -
Delaware Optimum Small Cap Value Fund
Net asset value Class A (A) $8.85
Sales charge (5.75% of offering price, or 6.10% of
amount invested per share) (B) 0.54
-----
Offering price $9.39
-----
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon redemption or repurchase of shares.
(B) See the current prospectus for purchases of $50,000 or more.
See accompanying notes
19
Statements Optimum Fund Trust
OF ASSETS AND LIABILITIES September 30, 2003 (Unaudited)
Optimum Optimum Optimum Optimum Optimum Optimum
Fixed Income International Large Cap Large Cap Small Cap Small Cap
Fund Fund Growth Fund Value Fund Growth Fund Value Fund
Assets:
Investments at market $10,814,574 $6,374,498 $8,622,512 $9,156,607 $5,371,350 $5,354,721
Cash and foreign currencies 135,643 137,608 2,376 106,401 676 3,423
Subscriptions receivable 557,961 185,650 474,215 483,904 97,973 102,853
Receivables for securities sold 590,882 10,632 112,101 18,802 - 53,212
Dividends receivable 141 19,438 4,139 8,796 678 2,698
Interest receivable 99,486 21 32 28 16 32
Due from DMC 47,234 41,463 42,732 36,705 36,636 38,188
----------- ---------- ---------- ---------- ---------- ----------
Total assets 12,245,921 6,769,310 9,258,107 9,811,243 5,507,329 5,555,127
----------- ---------- ---------- ---------- ---------- ----------
Liabilities:
Payables for securities purchased 1,475,225 674,590 568,654 1,110,271 132,482 217,635
Accrued expenses 55,966 53,978 54,632 47,614 48,015 48,399
----------- ---------- ---------- ---------- ---------- ----------
Total liabilities 1,531,191 728,568 623,286 1,157,885 180,497 266,034
----------- ---------- ---------- ---------- ---------- ----------
Total Net Assets $10,714,730 $6,040,742 $8,634,821 $8,653,358 $5,326,832 $5,289,093
=========== ========== ========== ========== ========== ==========
Investments at cost $10,640,628 $6,241,097 $8,626,246 $9,174,414 $5,143,162 $5,236,046
See accompanying notes
20
Statements Optimum Fund Trust
OF OPERATIONS Period Ended September 30, 2003 (Unaudited)
Optimum Optimum Optimum
Fixed Income International Large Cap
Fund Fund Growth Fund
Investment Income:
Dividends $ 141 $ 22,512 $ 7,023
Interest 33,151 1,263 1,170
Foreign tax withheld - (660) -
-------- -------- --------
33,292 23,115 8,193
-------- -------- --------
Expenses:
Management fees 6,575 6,813 7,015
Distribution expense - Class A 322 87 233
Distribution expense - Class B 163 29 96
Distribution expense - Class C 1,027 283 721
Accounting and administration expenses 17,621 17,058 17,402
Dividend disbursing and transfer agent fees and expenses 16,000 16,000 16,000
Professional fees 4,167 4,167 4,167
Trustees' fees 5,000 5,000 5,000
Reports and statements to shareholders 2,500 2,500 2,500
Custodian fees 2,866 1,601 1,490
Registration fees 73 73 73
Other 215 366 353
-------- -------- --------
56,529 53,977 55,050
Less expenses absorbed or waived (47,234) (41,463) (43,149)
-------- -------- --------
Total expenses 9,295 12,514 11,901
-------- -------- --------
Net Investment Income (Loss) 23,997 10,601 (3,708)
-------- -------- --------
Net Realized and Unrealized Gain (Loss) on Investments:
Net realized gain (loss) on:
Investments 19,923 (5,574) (2,633)
Foreign currencies (1,339) (3,272) (1,110)
-------- -------- --------
Net realized gain (loss) 18,584 (8,846) (3,743)
Net change in unrealized appreciation/depreciation of investments 174,131 131,835 (4,071)
-------- -------- --------
Net Realized and Unrealized Gain (Loss) on Investments 192,715 122,989 (7,814)
-------- -------- --------
Net Increase (Decrease) in Net Assets Resulting from Operations $216,712 $133,590 ($11,522)
======== ======== ========
See accompanying notes
21
Statements Optimum Fund Trust
OF OPERATIONS (CONTINUED) Period Ended September 30, 2003 (Unaudited)
Optimum Optimum Optimum
Large Cap Small Cap Small Cap
Fund Fund Value Fund
Investment Income:
Dividends $17,638 $ 1,074 $ 5,535
Interest 1,151 1,092 2,168
Foreign tax withheld (51) - -
------- -------- --------
18,738 2,166 7,703
------- -------- --------
Expenses:
Management fees 6,980 8,448 7,980
Distribution expense - Class A 227 50 52
Distribution expense - Class B 92 18 20
Distribution expense - Class C 733 151 158
Accounting and administration expenses 11,553 11,188 11,160
Dividend disbursing and transfer agent fees and expenses 16,000 16,000 16,000
Professional fees 4,167 4,167 4,167
Trustees' fees 5,000 5,000 5,000
Reports and statements to shareholders 2,500 2,500 2,500
Custodian fees 210 347 375
Registration fees 73 73 73
Other 78 83 938
------- -------- --------
47,613 48,025 48,423
Less expenses absorbed or waived (36,705) (36,636) (38,188)
Less expenses paid indirectly - (10) (21)
------- -------- --------
Total expenses 10,908 11,379 10,214
------- -------- --------
Net Investment Income (Loss) 7,830 (9,213) (2,511)
------- -------- --------
Net Realized and Unrealized Gain (Loss) on Investments:
Net realized gain on:
Investments 9,187 - 40,451
Foreign currencies 252 - -
------- -------- --------
Net realized gain 9,439 - 40,451
Net change in unrealized appreciation/depreciation of investments (17,871) 228,188 118,675
------- -------- --------
Net Realized and Unrealized Gain (Loss) on Investments (8,432) 228,188 159,126
------- -------- --------
Net Increase (Decrease) in Net Assets Resulting from Operations ($602) $218,975 $156,615
======= ======== ========
See accompanying notes
22
Statements Optimum Fund Trust
OF CHANGES IN NET ASSETS Period Ended September 30, 2003 (Unaudited)
Optimum Optimum Optimum
Fixed Income International Large Cap
Fund Fund Fund
Increase (Decrease) in Net Assets from Operations:
Net investment income (loss) $ 23,997 $ 10,601 $ (3,708)
Net realized gain (loss) on investments 18,584 (8,846) (3,743)
Net change in unrealized appreciation/depreciation of investments 174,131 131,835 (4,071)
----------- ---------- ----------
Net increase (decrease) in net assets from operations 216,712 133,590 (11,522)
----------- ---------- ----------
Capital Share Transactions:
Proceeds from shares sold:
Class A 2,150,513 617,394 1,497,426
Class B 538,174 88,064 269,677
Class C 3,658,615 1,036,392 2,722,494
Institutional Class 4,166,615 4,166,676 4,166,833
----------- ---------- ----------
10,513,917 5,908,526 8,656,430
----------- ---------- ----------
Cost of shares repurchased:
Class A (12,101) (1,358) (4,401)
Class B (195) (8) (12)
Class C (3,603) (8) (5,674)
Institutional Class - - -
----------- ---------- ----------
(15,899) (1,374) (10,087)
----------- ---------- ----------
Increase in net assets derived from capital share transactions 10,498,018 5,907,152 8,646,343
----------- ---------- ----------
Net increase in net assets 10,714,730 6,040,742 8,634,821
Net Assets:
Beginning of period - - -
----------- ---------- ----------
End of period $10,714,730 $6,040,742 $8,634,821
=========== ========== ==========
See accompanying notes
23
Statements Optimum Fund Trust
OF CHANGES IN NET ASSETS (CONTINUED) Period Ended September 30, 2003 (Unaudited)
Optimum Optimum Optimum
Large Cap Small Cap Small Cap
Value Fund Growth Fund Value Fund
Increase (Decrease) in Net Assets from Operations:
Net investment income (loss) $ 7,830 $ (9,213) $ (2,511)
Net realized gain on investments 9,439 - 40,451
Net change in unrealized appreciation/depreciation of investments (17,871) 228,188 118,675
---------- ---------- ----------
Net increase (decrease) in net assets from operations (602) 218,975 156,615
---------- ---------- ----------
Capital Share Transactions:
Proceeds from shares sold:
Class A 1,493,384 319,646 327,678
Class B 265,636 52,320 56,600
Class C 2,734,941 575,805 585,089
Institutional Class 4,174,686 4,166,658 4,166,669
---------- ---------- ----------
8,668,647 5,114,429 5,136,036
---------- ---------- ----------
Cost of shares repurchased:
Class A (9,027) (5,374) (2,346)
Class B (12) - (8)
Class C (5,648) (1,198) (1,204)
Institutional Class - - -
---------- ---------- ----------
(14,687) (6,572) (3,558)
---------- ---------- ----------
Increase in net assets derived from capital share transactions 8,653,960 5,107,857 5,132,478
---------- ---------- ----------
Net increase in net assets 8,653,358 5,326,832 5,289,093
Net Assets:
Beginning of period - - -
---------- ---------- ----------
End of period $8,653,358 $5,326,832 $5,289,093
========== ========== ==========
See accompanying notes
24
Financial
HIGHLIGHTS
Selected data for each share of the Fund outstanding
throughout each period were as follows:
Optimum Fixed Income Fund
Institutional
Class A Class B Class C Class
8/1/03(1) 8/1/03(1) 8/1/03(1) 8/1/03(1)
to to to to
9/30/03 9/30/03 9/30/03 9/30/03
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net asset value, beginning of period $8.500 $8.500 $8.500 $8.500
Income from investment operations:
Net investment income(2) 0.035 0.027 0.027 0.039
Net realized and unrealized gain on investments 0.235 0.243 0.243 0.231
------ ------ ------ ------
Total from investment operations 0.270 0.270 0.270 0.270
------ ------ ------ ------
Net asset value, end of period $8.770 $8.770 $8.770 $8.770
====== ====== ====== ======
Total return(3) 3.18% 3.18% 3.18% 3.18%
Ratios and supplemental data:
Net assets, end of period (000 omitted) $2,170 $545 $3,699 $4,300
Ratio of expenses to average net assets 1.20% 1.85% 1.85% 0.85%
Ratio of expenses to average net assets prior to expense limitation 6.23% 6.88% 6.88% 5.88%
Ratio of net investment income to average net assets 2.36% 1.71% 1.71% 2.71%
Ratio of net investment loss to average net assets prior to expense
limitation (2.67%) (3.32%) (3.32%) (2.32%)
Portfolio turnover 409% 409% 409% 409%
(1) Date of commencement of operations; ratios and portfolio turnover have been annualized and total return has not been
annualized.
(2) The average shares outstanding method has been applied for per share information.
(3) Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of
dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return
reflects a waiver and payment of fees by the manager. Performance would have been lower had the expense limitation not been
in effect.
See accompanying notes
26
Financial
HIGHLIGHTS (CONTINUED)
Selected data for each share of the Fund outstanding
throughout each period were as follows:
Optimum International Fund
Institutional
Class A Class B Class C Class
8/1/03(1) 8/1/03(1) 8/1/03(1) 8/1/03(1)
to to to to
9/30/03 9/30/03 9/30/03 9/30/03
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net asset value, beginning of period $8.500 $8.500 $8.500 $8.500
Income from investment operations:
Net investment income(2) 0.016 0.008 0.008 0.021
Net realized and unrealized gain on investments 0.294 0.292 0.292 0.289
------ ------ ------ ------
Total from investment operations 0.310 0.300 0.300 0.310
------ ------ ------ ------
Net asset value, end of period $8.810 $8.800 $8.800 $8.810
====== ====== ====== ======
Total return(3) 3.65% 3.53% 3.53% 3.65%
Ratios and supplemental data:
Net assets, end of period (000 omitted) $612 $87 $1,021 $4,321
Ratio of expenses to average net assets 1.92% 2.57% 2.57% 1.57%
Ratio of expenses to average net assets prior to expense limitation 7.24% 7.89% 7.89% 6.89%
Ratio of net investment income to average net assets 1.06% 0.41% 0.41% 1.41%
Ratio of net investment loss to average net assets prior to expense
limitation (4.26%) (4.91%) (4.91%) (3.91%)
Portfolio turnover 66% 66% 66% 66%
(1) Date of commencement of operations; ratios and portfolio turnover have been annualized and total return has not been
annualized.
(2) The average shares outstanding method has been applied for per share information.
(3) Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of
dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return
reflects a waiver and payment of fees by the manager. Performance would have been lower had the expense limitation not been
in effect.
See accompanying notes
26
Financial
HIGHLIGHTS (CONTINUED)
Selected data for each share of the Fund outstanding
throughout each period were as follows:
Optimum Large Cap Growth Fund
Institutional
Class A Class B Class C Class
8/1/03(1) 8/1/03(1) 8/1/03(1) 8/1/03(1)
to to to to
9/30/03 9/30/03 9/30/03 9/30/03
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net asset value, beginning of period $8.500 $8.500 $8.500 $8.500
Income from investment operations:
Net investment income(2) (0.009) (0.018) (0.017) (0.004)
Net realized and unrealized gain on investments 0.149 0.148 0.147 0.144
------ ------ ------ ------
Total from investment operations 0.140 0.130 0.130 0.140
------ ------ ------ ------
Net asset value, end of period $8.640 $8.630 $8.630 $8.640
====== ====== ====== ======
Total return(3) 1.65% 1.53% 1.53% 1.65%
Ratios and supplemental data:
Net assets, end of period (000 omitted) $1,474 $264 $2,661 $4,236
Ratio of expenses to average net assets 1.61% 2.26% 2.26% 1.26%
Ratio of expenses to average net assets prior to expense limitation 6.17% 6.82% 6.82% 5.82%
Ratio of net investment loss to average net assets (0.65%) (1.30%) (1.30%) (0.30%)
Ratio of net investment loss to average net assets prior to expense
limitation (5.21%) (5.86%) (5.86%) (4.86%)
Portfolio turnover 37% 37% 37% 37%
(1) Date of commencement of operations; ratios and portfolio turnover have been annualized and total return has not been
annualized.
(2) The average shares outstanding method has been applied for per share information.
(3) Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of
dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return
reflects a waiver and payment of fees by the manager. Performance would have been lower had the expense limitation not been
in effect.
See accompanying notes
27
Financial
HIGHLIGHTS (CONTINUED)
Selected data for each share of the Fund outstanding
throughout each period were as follows:
Optimum Large Cap Value Fund
Institutional
Class A Class B Class C Class
8/1/03(1) 8/1/03(1) 8/1/03(1) 8/1/03(1)
to to to to
9/30/03 9/30/03 9/30/03 9/30/03
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net asset value, beginning of period $8.500 $8.500 $8.500 $8.500
Income from investment operations:
Net investment income(2) 0.010 0.002 0.002 0.015
Net realized and unrealized gain on investments 0.100 0.098 0.098 0.095
------ ------ ------ ------
Total from investment operations 0.110 0.100 0.100 0.110
------ ------ ------ ------
Net asset value, end of period $8.610 $8.600 $8.600 $8.610
------ ------ ------ ------
Total return(3) 1.29% 1.18% 1.18% 1.29%
Ratios and supplemental data:
Net assets, end of period (000 omitted) $1,473 $262 $2,695 $4,223
Ratio of expenses to average net assets 1.50% 2.15% 2.15% 1.15%
Ratio of expenses to average net assets prior to expense limitation 5.69% 6.34% 6.34% 5.34%
Ratio of net investment income to average net assets 0.69% 0.04% 0.04% 1.04%
Ratio of net investment loss to average net assets prior to expense
limitation (3.50%) (4.15%) (4.15%) (3.15%)
Portfolio turnover 44% 44% 44% 44%
(1) Date of commencement of operations; ratios and portfolio turnover have been annualized and total return has not been
annualized.
(2) The average shares outstanding method has been applied for per share information.
(3) Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of
dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return
reflects a waiver and payment of fees by the manager. Performance would have been lower had the expense limitation not been
in effect.
See accompanying notes
28
Financial
HIGHLIGHTS (CONTINUED)
Selected data for each share of the Fund outstanding
throughout each period were as follows:
Optimum Small Cap Growth Fund
Institutional
Class A Class B Class C Class
8/1/03(1) 8/1/03(1) 8/1/03(1) 8/1/03(1)
to to to to
9/30/03 9/30/03 9/30/03 9/30/03
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net asset value, beginning of period $8.500 $8.500 $8.500 $8.500
Income from investment operations:
Net investment income(2) (0.022) (0.031) (0.031) (0.018)
Net realized and unrealized gain on investments 0.522 0.531 0.531 0.518
------ ------ ------ ------
Total from investment operations 0.500 0.500 0.500 0.500
------ ------ ------ ------
Net asset value, end of period $9.000 $9.000 $9.000 $9.000
====== ====== ====== ======
Total return(3) 5.88% 5.88% 5.88% 5.88%
Ratios and supplemental data:
Net assets, end of period (000 omitted) $310 $51 $554 $4,412
Ratio of expenses to average net assets 1.81% 2.46% 2.46% 1.46%
Ratio of expenses to average net assets prior to expense limitation
and expenses paid indirectly 6.58% 7.23% 7.23% 6.23%
Ratio of net investment loss to average net assets (1.53%) (2.18%) (2.18%) (1.18%)
Ratio of net investment loss to average net assets prior to expense
limitation and expenses paid indirectly (6.30%) (6.95%) (6.95%) (5.95%)
Portfolio turnover 0% 0% 0% 0%
(1) Date of commencement of operations; ratios and portfolio turnover have been annualized and total return has not been
annualized.
(2) The average shares outstanding method has been applied for per share information.
(3) Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of
dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return
reflects a waiver and payment of fees by the manager. Performance would have been lower had the expense limitation not been
in effect.
See accompanying notes
29
Financial
HIGHLIGHTS (CONTINUED)
Selected data for each share of the Fund outstanding
throughout each period were as follows:
Optimum Small Cap Value Fund
Institutional
Class A Class B Class C Class
8/1/03(1) 8/1/03(1) 8/1/03(1) 8/1/03(1)
to to to to
9/30/03 9/30/03 9/30/03 9/30/03
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Net asset value, beginning of period $8.500 $8.500 $8.500 $8.500
Income (loss) from investment operations:
Net investment loss(2) (0.009) (0.018) (0.018) (0.004)
Net realized and unrealized gain on investments 0.359 0.358 0.358 0.354
------ ------ ------ ------
Total from investment operations 0.350 0.340 0.340 0.350
------ ------ ------ ------
Net asset value, end of period $8.850 $8.840 $8.840 $8.850
====== ====== ====== ======
Total return(3) 4.12% 4.00% 4.00% 4.12%
Ratios and supplemental data:
Net assets, end of period (000 omitted) $323 $55 $572 $4,339
Ratio of expenses to average net assets 1.67% 2.32% 2.32% 1.32%
Ratio of expenses to average net assets prior to expense limitation
and expenses paid indirectly 6.70% 7.35% 7.35% 6.35%
Ratio of net investment loss to average net assets (0.66%) (1.31%) (1.31%) (0.31%)
Ratio of net investment loss to average net assets prior to expense
limitation and expenses paid indirectly (5.69%) (6.34%) (6.34%) (5.34%)
Portfolio turnover 60% 60% 60% 60%
(1) Date of commencement of operations; ratios and portfolio turnover have been annualized and total return has not been
annualized.
(2) The average shares outstanding method has been applied for per share information.
(3) Total investment return is based on the change in net asset value of a share during the period and assumes reinvestment of
dividends and distributions at net asset value and does not reflect the impact of a sales charge. Total investment return
reflects a waiver and payment of fees by the manager. Performance would have been lower had the expense limitation not been
in effect.
See accompanying notes
30
Notes Optimum Fund Trust
TO FINANCIAL STATEMENTS September 30, 2003 (Unaudited)
Optimum Fund Trust (the "Trust") is organized as a Delaware statutory trust and
offers six series: Optimum Fixed Income Fund, Optimum International Fund,
Optimum Large Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small Cap
Growth Fund, and Optimum Small Cap Value Fund, (each a "Fund" and collectively,
the "Funds"). The Trust is an open-end investment company. The Funds are
considered diversified under the Investment Company Act of 1940, as amended, and
offer Class A, Class B, Class C and Institutional Class shares. Class A shares
are sold with a front-end sales charge of up to 5.75% for Optimum Large Cap
Growth Fund, Optimum Large Cap Value Fund, Optimum Small Cap Growth Fund,
Optimum Small Cap Value Fund and Optimum International Fund and 4.50% for
Optimum Fixed Income Fund. Class B shares are sold with a contingent deferred
sales charge that declines from 4% to zero depending upon the period of time the
shares are held. Class B shares will automatically convert to Class A shares on
a quarterly basis approximately eight years after purchase. Class C shares are
sold with a contingent deferred sales charge of 1%, if redeemed during the first
12 months. Institutional Class shares are not subject to a sales charge and are
offered for sale exclusively to a limited group of investors. The individual
Funds had not commenced operations except those related to organizational
matters and the sale of initial shares of beneficial interest to the initial
shareholder, Delaware Management Company, Inc. (DMC), the investment manager, on
July 17, 2003.
The investment objective of Optimum Fixed Income Fund is to seek a high level of
income. The Fund may also seek growth of capital.
The investment objective of Optimum International Fund is to seek long-term
growth of capital. The Fund may also seek income.
The investment objective of Optimum Large Cap Growth Fund is to seek long-term
growth of capital.
The investment objective of Optimum Large Cap Value Fund is to seek long-term
growth of capital. The Fund may also seek income.
The investment objective of Optimum Small Cap Growth Fund is to seek long-term
growth of capital.
The investment objective of Optimum Small Cap Value Fund is to seek long-term
growth of capital.
1. Significant Accounting Policies
The following accounting policies are in accordance with accounting principles
generally accepted in the United States and are consistently followed by the
Trust.
Security Valuation - All equity securities are valued as of the time of the
regular close of the New York Stock Exchange (NYSE) on the valuation date. All
NYSE traded securities are valued at the last quoted sales price. Securities
traded on the Nasdaq Stock Market Inc. ("NASDAQ") are valued in accordance with
the NASDAQ Official Closing Price, which may not be the last sales price. If on
a particular day an equity security does not trade, then the mean between the
bid and asked prices will normally be used. Securities listed on a foreign
exchange are normally valued at the last quoted sales price before each Fund is
valued. U.S. government and agency securities are valued at the mean between the
bid and asked prices. Other long-term debt securities are valued by an
independent pricing service and such prices are believed to reflect the fair
value of such securities. Short-term debt securities having less than 60 days to
maturity are valued at amortized cost, which approximates market value. Other
securities and assets for which market quotations are not readily available are
valued at fair value as determined in good faith under the direction of the
Trust's Board of Trustees. In determining whether market quotations are readily
available or fair valuation will be used, various factors will be taken into
consideration, such as market closures, or with respect to foreign securities,
aftermarket trading or significant events after local market trading (e.g.,
government actions or pronouncements, trading volume or volatility on markets,
exchanges among dealers, or news events).
Federal Income Taxes - Each Fund intends to elect to be, and qualify for
treatment as, a regulated investment company under Subchapter M of the Internal
Revenue Code of 1986, as amended. As a regulated investment company, a Fund
generally pays no federal income tax on the income and gains it distributes.
Each Fund intends to meet the calendar year distribution requirements imposed by
the Code to avoid the imposition of a 4% excise tax.
Organizational and Offering Costs - Costs incurred in connection with the
organization of the Trust were borne by Delaware Management Company (DMC) a
series of Delaware Management Business Trust and Linsco/Private Ledger Corp.,
who provides certain sub-transfer agency services to the Funds and who has
entered into an Investment Consulting Agreement with DMC.
Class Accounting - Investment income, common expenses and realized and
unrealized gain (loss) on investments are allocated to the various classes of
each Fund on the basis of daily net assets of each class. Distribution expenses
relating to a specific class are charged directly to that class.
Repurchase Agreements - Each Fund may invest in a pooled cash account along with
other members of the Delaware Investments Family of Funds. The aggregate daily
balance of the pooled cash account is invested in repurchase agreements secured
by obligations of the U.S. government. The respective collateral is held by each
Fund's custodian bank until the maturity of the respective repurchase
agreements. Each repurchase agreement is 102% collateralized. However, in the
event of default or bankruptcy by the counterparty to the agreement, realization
of the collateral may be subject to legal proceedings.
Foreign Currency Transactions - Transactions denominated in foreign currencies
are recorded at the prevailing exchange rates on the valuation date. The value
of all assets and liabilities denominated in foreign currencies are translated
into U.S. dollars at the exchange rate of such currencies against the U.S.
dollar daily. Transaction gains or losses resulting from changes in exchange
rates during the reporting period or upon settlement of the foreign currency
transaction are reported in operations for the current period. The Funds isolate
that portion of realized gains and losses on investments in debt securities,
which are due to changes in foreign exchange rates from that which are due to
changes in market prices of debt securities. For foreign equity securities,
these changes are included in realized gains (losses) on investments. The Funds
report certain foreign currency related transactions as components of realized
gains (losses) for financial reporting purposes, where such components are
treated as ordinary income (loss) for federal income tax purposes.
Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
Other - Expenses common to all funds within the Optimum Fund Trust are allocated
amongst the funds on the basis of average net assets. Security transactions are
recorded on the date the securities are purchased or sold (trade date). Costs
used in calculating realized gains and losses on the sale of investment
securities are those of the specific securities sold. Dividend income is
recorded on the ex-dividend date. Interest income is recorded on the accrual
basis. Discounts and premiums are amortized to interest income over the lives of
the respective securities. Realized gains (losses) on paydowns of mortgage- and
asset-backed
31
Notes Optimum Fund Trust
TO FINANCIAL STATEMENTS (CONTINUED)
1. Significant Accounting Policies (continued)
securities are classified as interest income. Distributions received from
investments in Real Estate Investment Trusts are recorded as dividend income on
ex-dividend date, subject to reclassification upon notice of the character of
such distribution by the issuer. Foreign dividends are also recorded on the
ex-dividend date or as soon after the ex-dividend date that the Funds are aware
of such dividends, net of all non-rebatable tax withholdings. Withholding taxes
on foreign dividends have been recorded in accordance with each Fund's
understanding of the applicable country's tax rules and rates. The Optimum Large
Cap Growth Fund, Optimum Large Cap Value Fund, Optimum Small Cap Growth Fund,
Optimum Small Cap Value Fund, and Optimum International Fund expects to declare
and pay all of its net investment income , if any, to shareholders as dividends
annually. The Optimum Fixed Income Fund expects to declare and pay dividends
quarterly. Each Fund will pay net capital gains, if any, at least annually. In
addition, in order to satisfy certain distribution requirements of the Tax
Reform Act of 1986, each Fund may declare special year-end dividend and capital
gains distributions during November or December to shareholders of record on a
date in such month. Such distributions, if received by shareholders by January
31, are deemed to have been paid by a Fund and received by shareholders on the
earlier of the date paid or December 31 of the prior year.
The Funds may receive earnings credits from their custodian when positive cash
balances are maintained, which are used to offset custody fees. The expense paid
under the above arrangement is included in its respective expense caption on the
Statements of Operations with the corresponding expense offset shown as "expense
paid indirectly." The amount of this expense for the period ended September 30,
2003 was as follows:
Optimum Optimum
Small Cap Small Cap
Growth Fund Value Fund
----------- ----------
Earnings credits $10 $21
2. Investment Management, Administration Agreements and Other Transactions with
Affiliates
DMC furnishes investment management services to each Fund and has full
discretion and responsibility, subject to the overall supervision of the Trust's
Board of Trustees, to select and contract with one or more investment
sub-advisers to manage the investment operations and composition of each Fund,
and to render investment advice for each Fund, including the purchase,
retention, and dispositions of investments, securities and cash contained in
each Fund. The investment management agreement obligates the investment manager
to implement decisions with respect to the allocation or reallocation of each
Fund's assets among one or more current or additional sub-advisers, and to
monitor the sub-advisers' compliance with the relevant Fund's investment
objective, policies and restrictions. DMC pays the sub-advisers out of its fees.
In accordance with the terms of the investment management agreement, the
investment manager is entitled to receive an annual fee equal to the following
percentage rates of the average daily net assets of a Fund:
Optimum Large Cap Growth Fund 0.8000% of assets up to $250 million
0.7875% of assets from $250 million to $300 million
0.7625% of assets from $300 million to $400 million
0.7375% of assets from $400 million to $500 million
0.7250% of assets over $500 million
Optimum Large Cap Value Fund 0.8000% of assets up to $100 million
0.7375% of assets from $100 million to $250 million
0.7125% of assets from $250 million to $500 million
0.6875% of assets over $500 million
Optimum Small Cap Growth Fund 1.1000% of assets
Optimum Small Cap Value Fund 1.0500% of assets up to $75 million
1.0250% of assets from $75 million to $150 million
1.0000% of assets over $150 million
Optimum International Fund 0.8750% of assets up to $50 million
0.8000% of assets from $50 to 100 million
0.7800% of assets from $100 to 300 million
0.7650% of assets from $300 to 400 million
0.7300% of assets over $400 million
Optimum Fixed Income Fund 0.7000% of assets up to $25 million
0.6500% of assets from $25 million to $100 million
0.6000% of assets over $100 million
DMC has entered into sub-advisory agreements for the Trust as follows: Optimum
Large Cap Growth Fund - Marsico Capital Management, LLC and T. Rowe Price
Associates, Inc.; Optimum Large Cap Value Fund - Massachusetts Financial
Services Company and Van Kampen Asset Management, Inc.; Optimum Small Cap Growth
Fund - Liberty Wagner Asset Management, L.P.; Optimum Small Cap Value Fund -
Hotchkis and Wiley Capital Management, LLC and Delafield Asset Management (a
division of Reich & Tang Asset Management, LLC); Optimum International Fund -
Delaware International Advisers Ltd. (DIAL), an affiliate of DMC, and Marsico
Capital Management, LLC; Optimum Fixed Income Fund - DIAL and Deutsche
Investment Management Americas Inc.
For the services provided, DMC pays DIAL sub-advisory fees as follows: Optimum
Fixed Income Fund - an annual fee on the first $25 million of it's portion of
average daily net assets at 0.35%, 0.30% on the next $75 million, and 0.25% on
it's portion of average daily net assets over $100 million; Optimum
International Fund - an annual fee on the first $50 million of it's portion of
average daily net assets at 0.55%, 0.40% on the next $50 million, and 0.36% on
it's portion of average daily net assets over $100 million.
32
Notes Optimum Fund Trust
TO FINANCIAL STATEMENTS (CONTINUED)
2. Investment Management, Administration Agreements and Other Transactions with
Affiliates (continued)
DMC has contracted to waive that portion, if any, of its management fee and
reimburse each Fund to the extent necessary to ensure that annual operating
expenses, exclusive of taxes, interest, brokerage commissions, distribution
fees, certain insurance costs, and extraordinary expenses, do not exceed
specified percentages of average daily net assets through August 1, 2004 as
shown below:
Optimum Optimum Optimum Optimum Optimum Optimum
Fixed Income International Large Cap Large Cap Small Cap Small Cap
Fund Fund Growth Fund Value Fund Growth Fund Value Fund
------------ ------------- ----------- ---------- ----------- ----------
0.85% 1.57% 1.26% 1.15% 1.46% 1.32%
Delaware Service Company, Inc. (DSC), an affiliate of DMC and DIAL, provides the
Trust with fund accounting, administrative, and transfer agency services
pursuant to a Mutual Fund Services Agreement. For fund accounting services, the
Trust pays DSC a fee at an annual rate of 0.04% of the Trust's total average
daily net assets, plus out-of-pocket expenses, subject to certain minimums. DSC
also provides the Trust with administrative services including financial and tax
reporting, corporate governance, and preparation of materials and reports for
the Board of Trustees. For administrative services, the Trust pays DSC a fee at
an annual rate of 0.35% of the Trust's total average daily net assets, plus
out-of-pocket expenses. DSC also serves as the shareholder servicing, dividend
disbursing, and transfer agent for each Fund. For transfer agency services, the
Trust pays DSC a fee at an annual rate of 0.15% of the Trust's total average
daily net assets, subject to certain minimums.
Delaware Distributors, L.P. (DDLP) serves as the national distributor of each
Fund's shares pursuant to a Distribution Agreement. Pursuant to the Distribution
Agreement and Rule 12b-1 plans, the Funds pay DDLP an annual fee of 0.35% of the
average daily net assets of the Class A shares and 1.00% of the average daily
net assets of the Class B and C shares. No distribution expenses are paid by
Institutional Class shares.
At September 30, 2003, each Fund had receivables from or liabilities payable to
affiliates as follows:
Optimum Optimum Optimum Optimum Optimum Optimum
Fixed Income International Large Cap Large Cap Small Cap Small Cap
Fund Fund Growth Fund Value Fund Growth Fund Value Fund
------------ ------------- ----------- ---------- ----------- ----------
Dividend disbursing, transfer agent fees,
accounting and other expenses payable to DSC $(33,621) $(33,058) $(33,402) $(27,554) $(27,188) $(27,160)
Other expenses payable to DMC and affiliates (1,330) (1,315) (1,315) (1,330) (1,315) (1,315)
Receivable from DMC or DIAL under expense
limitation agreement 40,658 34,650 38,635 29,725 28,188 30,208
DMC, DSC and DDLP are indirect, wholly owned subsidiaries of Delaware Management
Holdings, Inc., which is an indirect wholly owned subsidiary of Lincoln National
Corporation.
Certain officers of DIAL, DMC, DSC, and DDLP are officers and/or trustees of the
Funds. These officers and trustees are paid no compensation by the Funds.
3. Investments
For the period ended September 30, 2003, the Funds made purchases and sales of
investment securities other than U.S. government securities and short-term
investments as follows:
Optimum Optimum Optimum Optimum Optimum Optimum
Fixed Income International Large Cap Large Cap Small Cap Small Cap
Fund Fund Growth Fund Value Fund Growth Fund Value Fund
------------ ------------- ----------- ---------- ----------- ----------
Purchases $6,857,160 $5,984,466 $7,765,128 $8,530,239 $4,518,162 $4,364,756
Sales 1,553,751 530,136 354,249 426,252 - 376,161
At September 30, 2003, the cost of investments for federal income tax purposes
has been estimated since the final tax characteristics cannot be determined
until fiscal year end. At September 30, 2003, the cost of investments and
unrealized appreciation (depreciation) for each Fund were as follows:
Optimum Optimum Optimum Optimum Optimum Optimum
Fixed Income International Large Cap Large Cap Small Cap Small Cap
Fund Fund Growth Fund Value Fund Growth Fund Value Fund
------------ ------------ ----------- ---------- ----------- ----------
Cost of investments $10,640,628 $6,241,097 $8,626,246 $9,174,414 $5,143,162 $5,236,046
=========== ========== ========== ========== ========== ==========
Aggregate unrealized appreciation $ 180,124 $ 228,706 $ 141,330 $ 105,550 $ 323,345$ 177,364
Aggregate unrealized depreciation (6,178) (95,305) (145,064) (123,357) (95,157) (58,689)
----------- ---------- ---------- ---------- ---------- ----------
Net unrealized appreciation (depreciation) $ 173,946 $ 133,401 $ (3,734) $ (17,807) $ 228,188 $ 118,675
=========== ========== ========== ========== ========== ==========
33
Notes Optimum Fund Trust
TO FINANCIAL STATEMENTS (CONTINUED)
4. Dividend and Distribution Information
Income and long-term capital gain distributions are determined in accordance
with federal income tax regulations, which may differ from accounting principles
generally accepted in the United States. There were no distributions paid during
the period ended September 30, 2003.
The components of net assets are estimated since final tax characteristics
cannot be determined until fiscal year end. As of September 30, 2003, the
estimated components of net assets on a tax basis were as follows:
Optimum Fixed Income Fund Optimum International Fund Optimum Large Cap Growth Fund
------------------------- -------------------------- -----------------------------
Shares of beneficial interest $10,498,018 $5,907,152 $8,646,343
Undistributed ordinary income (loss) 22,658 7,329 (4,818)
Undistributed net realized capital
gain/(losses) on investments 19,923 (5,574) (2,633)
Unrealized appreciation (depreciation)
of investments 174,131 133,835 (4,071)
----------- ---------- ----------
Net assets $10,714,730 $6,042,742 $8,634,821
=========== ========== ==========
Optimum Large Cap Value Fund Optimum Small Cap Growth Fund Optimum Small Cap Value Fund
---------------------------- ----------------------------- ----------------------------
Shares of beneficial interest $8,653,960 $5,107,857 $5,132,478
Undistributed ordinary income (loss) 8,082 (9,213) (2,511)
Undistributed net realized capital gain
on investments 9,187 - 40,451
Unrealized appreciation (depreciation)
of investments (17,871) 228,188 118,675
---------- ---------- ----------
Net assets $8,653,358 $5,326,832 $5,289,093
========== ========== ==========
5. Capital Shares
Transactions in capital shares were as follows:
Optimum Optimum Optimum Optimum Optimum Optimum
Fixed Income International Large Cap Large Cap Small Cap Small Cap
Fund Fund Growth Fund Value Fund Growth Fund Value Fund
------------- ------------- ----------- ---------- ----------- ----------
Shares sold:
Class A 248,859 69,656 171,110 172,124 35,072 36,737
Class B 62,205 9,881 30,649 30,440 5,620 6,273
Class C 422,452 115,945 309,011 313,983 61,737 64,831
Institutional Class 490,193 490,193 490,193 490,193 490,193 490,193
---------- -------- --------- ---------- -------- --------
1,223,709 685,675 1,000,963 1,006,740 592,622 598,034
---------- -------- --------- ---------- -------- --------
Shares repurchased:
Class A (1,407) (153) (505) (1,040) (609) (266)
Class B (23) (1) (1) (1) - (1)
Class C (417) (1) (638) (643) (127) (133)
Institutional Class - - - - - -
---------- -------- --------- ---------- -------- --------
(1,847) (155) (1,144) (1,684) (736) (400)
---------- -------- --------- ---------- -------- --------
Net increase 1,221,862 685,520 999,819 1,005,056 591,886 597,634
========== ======== ========= ========== ======== ========
34
Notes Optimum Fund Trust
TO FINANCIAL STATEMENTS (CONTINUED)
6. Foreign Exchange Contracts
The Optimum International Fund, Optimum Fixed Income Fund, Optimum Large Cap
Growth Fund and Optimum Large Cap Value Fund may enter into forward foreign
currency exchange contracts as a way of managing foreign exchange rate risk. The
Funds may enter into these contracts to fix the U.S. dollar value of a security
that it has agreed to buy or sell for the period between the date the trade was
entered into and the date the security is delivered and paid for. The Funds may
also use these contracts to hedge the U.S. dollar value of securities they
already own that are denominated in foreign currencies.
Forward foreign currency exchange contracts are valued at the mean between the
bid and asked prices of the contracts and are marked-to-market daily.
Interpolated values are derived when the settlement date of the contract is an
interim date for which quotations are not available. The change in market value
is recorded as an unrealized gain or loss. When the contract is closed, a
realized gain or loss is recorded equal to the difference between the value of
the contract at the time it was opened and the value at the time it was closed.
The use of forward foreign currency exchange contracts does not eliminate
fluctuations in the underlying prices of the securities, but does establish a
rate of exchange that can be achieved in the future. Although forward foreign
currency exchange contracts limit the risk of loss due to a decline in the value
of the hedged currency, they also limit any potential gain that might result
should the value of the currency increase. In addition, the Funds could be
exposed to risks if the counterparties to the contracts are unable to meet the
terms of their contracts.
The following forward foreign currency exchange contracts were outstanding at
September 30, 2003:
Contracts In Unrealized
to Exchange Settlement Appreciation
Receive (Deliver) For Date (Depreciation)
----------------- --------- --------------- --------------
Optimum Fixed Income Fund 15,748 AUD $(10,676) October 1, 2003 $ (17)
49,306 EUR $(56,608) October 1, 2003 $ 811
4,993,885 JPY $(44,764) October 1, 2003 $ (62)
66,251 NOK $ (9,436) October 1, 2003 $ (47)
29,080 PZY $ (7,305) October 1, 2003 $ 88
89,894 SEK $(11,616) October 1, 2003 $ 6
-----
$ 779
=====
Optimum International Fund 34,511 GBP $(57,499) October 1, 2003 $(162)
12,350 GBP $(20,564) October 2, 2003 $ (45)
8,517 EUR $ (9,871) October 1, 2003 $ 48
11,680 EUR $(13,537) October 2, 2003 $ 65
10,537,205 JPY $(94,600) October 1, 2003 $(278)
19,677 MXP $ (1,793) October 2, 2003 $ (10)
16,541 NOK $ (2,355) October 2, 2003 $ (11)
(14,040) CHF $ 10,450 October 1, 2003 $(182)
26,236 CHF $(19,748) October 2, 2003 $ 118
146,090 ZAR $(20,533) October 2, 2003 $ 436
-----
$ (21)
=====
Optimum Large Cap Value Fund 2,059 GBP $ (3,415) October 1, 2003 $ 5
2,764 GBP $ (4,609) October 2, 2003 $ (16)
-----
$ (11)
=====
Abbreviations of Currency:
AUD - Australian Dollar MXP - Mexican Peso
CHF - Swiss Franc NOK - Norwegian Kroner
EUR - European Monetary Unit PZY - Polish Zloty
GBP - Great British Pound SEK - Swedish Krona
JPY - Japanese Yen ZAR - South African Rand
7. Credit and Market Risks
Some countries in which Optimum Fixed Income Fund, Optimum International Fund,
Optimum Large Cap Growth Fund and Optimum Large Cap Value Fund may invest
require governmental approval for the repatriation of investment income, capital
or the proceeds of sales of securities by foreign investors. In addition, if
there is a deterioration in a country's balance of payments or for other
reasons, a country may impose temporary restrictions on foreign capital
remittances abroad.
The securities exchanges of certain foreign markets are substantially smaller,
less liquid and more volatile than the major securities markets in the United
States. Consequently, acquisition and disposition of securities by the Funds may
be inhibited. In addition, a significant portion of the aggregate market value
of equity securities listed on the major securities exchanges in emerging
markets are held by a smaller number of investors. This may limit the number of
shares available for acquisition or disposition by the Funds.
The Optimum Fixed Income Fund may invest in high yield fixed income securities
which carry ratings of BB or lower by S&P and/or Ba or lower by Moody's.
Investments in these higher yielding securities are generally accompanied by a
greater degree of credit risk than higher rated securities. Additionally, lower
rated securities may be more susceptible to adverse economic and competitive
industry conditions than investment grade securities.
35
Notes Optimum Fund Trust
TO FINANCIAL STATEMENTS (CONTINUED)
7. Credit and Market Risks (continued)
The Optimum Fixed Income Fund invests in fixed-income securities whose value is
derived from an underlying pool of mortgages or consumer loans. Investors
receive principal and interest payments as the underlying mortgages and consumer
loans are paid back. Some of these securities are collateralized mortgage
obligations (CMOs). CMOs are debt securities issued by U.S. government agencies
or by financial institutions and other mortgage lenders which are collateralized
by a pool of mortgages held under an indenture. Prepayment of mortgages may
shorten the stated maturity of the obligations and can result in a loss of
premium, if any has been paid. Certain of these securities may be stripped
(securities which provide only the principal or interest feature of the
underlying security). The yield to maturity on an interest-only CMO is extremely
sensitive not only to changes in prevailing interest rates, but also to the rate
of principal payments (including prepayments) on the related underlying mortgage
assets. A rapid rate of principal payments may have a material adverse affect on
the Fund's yield to maturity. If the underlying mortgage assets experience
greater than anticipated prepayments of principal, the Fund may fail to fully
recoup its initial investment in these securities even if the securities are
rated in the highest rating categories. The Fund did not hold any principal-only
or interest-only CMOs at September 30, 2003.
Each Fund may invest up to 15% of their total assets in illiquid securities,
which may include securities with contractual restrictions on resale, securities
exempt from registration under Rule 144A of the Securities Act of 1933, as
amended, and other securities which may not be readily marketable. The relative
illiquidity of these securities may impair each Fund from disposing of them in a
timely manner and at a fair price when it is necessary or desirable to do so.
The Optimum Small Cap Growth Fund and Optimum Small Cap Value Fund invest a
significant portion of their assets in small companies and may be subject to
certain risks associated with ownership of securities of small companies.
Investments in small-sized companies may be more volatile than investments in
larger companies for a number of reasons, which include more limited financial
resources or a dependence on narrow product lines.
8. Industry Allocation
As of September 30, 2003, the Optimum International Fund investment securities
classified by type of business were as follows:
Percentage
Industry of net assets
- -------- -------------
Automobiles & Components 4.57%
Banking & Finance 20.89
Business Services 1.17
Cable, Media & Publishing 5.86
Chemicals 1.47
Computers & Technology 2.06
Consumer Products 0.83
Electronics & Electrical Equipment 9.11
Energy 6.10
Food, Beverage & Tobacco 2.13
Healthcare & Pharmaceuticals 6.37
Industrial Machinery 2.30
Leisure, Lodging & Entertainment 3.04
Metals & Mining 1.27
Mutual Funds 0.50
Packaging & Containers 0.72
Paper & Forest Products 0.33
Real Estate 2.13
Retail 4.58
Semiconductors 1.78
Telecommunications 6.90
Transportation & Shipping 4.47
Utilities 3.84
------
Total 92.42%
======
36
Delaware
Investments(sm)
- --------------------------------------
A member of Lincoln Financial Group(R)
This semiannual report is for the information of Optimum Trust Funds
shareholders, but it may be used with prospective investors when preceded or
accompanied by a current prospectus for Optimum Trust Funds and the Delaware
Investments Performance Update for the most recently completed calendar quarter.
The prospectus sets forth details about charges, expenses, investment
objectives, and operating policies of each Fund. You should read the prospectus
carefully before you invest. The figures in this report represent past results
which are not a guarantee of future results. The return and principal value of
an investment in the Fund will fluctuate so that shares, when redeemed, may be
worth more or less than their original cost.
Board of Trustees Affiliated Officers Contact Information
Mark S. Casady Joseph H. Hastings Investment Manager
President and Chief Operating Officer Senior Vice President and Delaware Management Company
LPL Financial Services Chief Financial Officer Philadelphia, PA
Optimum Fund Trust
Jude T. Driscoll Philadelphia, PA International Affiliate
Chairman Delaware International Advisers Ltd.
Delaware Investments Family of Funds Richelle S. Maestro London, England
Senior Vice President,
David Kittredge General Counsel and Secretary National Distributor
Vice President Optimum Fund Trust Delaware Distributors, L.P.
Lincoln Financial Distributors, Inc. Philadelphia, PA Philadelphia, PA
Nicholas D. Constan Michael P. Bishof Shareholder Servicing, Dividend
Adjunct Professor - University of Pennsylvania Senior Vice President and Treasurer Disbursing and Transfer Agent
Optimum Fund Trust Delaware Service Company, Inc.
William W. Hennig Philadelphia, PA 2005 Market Street
Private Investor Philadelphia, PA 19103-7094
Durant Adams Hunter For Shareholders
Chief Executive Officer and Executive Recruiter 800 523-1918
Whitehead MANN Inc. (Executive Recruiting) For Securities Dealers and Financial
Institutions Representatives Only
Kenneth R. Leibler 800 362-7500
Chairman and Chief Executive Officer -
Boston Stock Exchange Web site
www.delawareinvestments.com
Stephen Paul Mullin
Principal - Econsult Corporation
Robert A. Rudell
Director - Medtox Scientific
Jon Edward Socolofsky
Private Investor
(8358) Printed in the USA
SA-901 [9/03] IVES 11/03 J9452
Item 2. Code of Ethics
Not applicable.
Item 3. Audit Committee Financial Expert
Not applicable.
Item 4. Principal Accountant Fees and Services
Not applicable.
Item 5. Audit Committee of Listed Registrants
Not applicable.
Item 6. [Reserved]
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies
Not applicable.
Item 8. [Reserved]
Item 9. Controls and Procedures
The registrant's principal executive officer and principal financial
officer have evaluated the registrant's disclosure controls and procedures
within 90 days of the filing of this report and have concluded that they are
effective in providing reasonable assurance that the information required to be
disclosed by the registrant in its reports or statements filed under the
Securities Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the rules and forms of the Securities and
Exchange Commission.
There were no significant changes in the registrant's internal control
over financial reporting that occurred during the registrant's last fiscal
half-year that have materially affected, or are reasonably likely to materially
affect, the registrant's internal control over financial reporting.
Item 10. Exhibits
(a) (1) Code of Ethics
Not applicable.
(2) Certifications of Principal Executive Officer and Principal Financial
Officer pursuant to Rule 30a-2 under the Investment Company Act of 1940
are attached hereto as Exhibit 99.CERT.
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 are
furnished herewith as Exhibit 99.906CERT.
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.
Name of Registrant:
JUDE T. DRISCOLL
- ------------------------------
By: Jude T. Driscoll
-----------------------
Title: Chairman
Date: December 5, 2003
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.
JUDE T. DRISCOLL
- ------------------------------
By: Jude T. Driscoll
-----------------------
Title: Chairman
Date: December 5, 2003
JOSEPH H. HASTINGS
- ------------------------------
By: Joseph H. Hastings
-----------------------
Title: Chief Financial Officer
Date: December 5, 2003