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 811-05775
WM Trust II
(Exact name of registrant as specified in charter)
1201 Third Avenue, 22nd Floor, Seattle, WA 98101
(Address of principal executive offices) (Zip code)
Jeffrey L. Lunzer
1201 Third Avenue, 22nd Floor, Seattle, WA 98101
(Name and address of agent for service)
Registrant's telephone number, including area code: (206) 461-3800
Date of fiscal year end: October 31, 2006
Date of reporting period: April 30, 2006
ITEM 1. REPORTS TO STOCKHOLDERS
(WM GROUP OF FUNDS LOGO)
WM GROUP OF FUNDS
(GRAPHIC)
Semiannual Report
April 30, 2006
Common sense. Uncommon solutions.(R)
WM Group of Funds
AT THE WM GROUP OF FUNDS, OUR PASSION IS PIECING INDIVIDUAL INVESTMENTS TOGETHER
INTO COMPREHENSIVE PORTFOLIOS TO MAKE YOUR FINANCIAL PLAN MORE EFFECTIVE.
(GRAPHIC)
Table of Contents
1 Letter from the President
WM Group of Funds Performance and Composition:
2 REIT Fund
3 Equity Income Fund
4 Growth & Income Fund
5 West Coast Equity Fund
6 Mid Cap Stock Fund
7 Growth Fund
8 Small Cap Value Fund
9 Small Cap Growth Fund
10 International Growth Fund
11 Short Term Income Fund
12 U.S. Government Securities Fund
13 Income Fund
14 High Yield Fund
15 Tax-Exempt Bond Fund
16 California Municipal Fund
17 California Insured Intermediate Municipal Fund
18 Glossary
19 Expense Information
22 Financial Statements
108 Notes to Financial Statements
117 Supplemental Information
NOT FDIC INSURED
MAY LOSE VALUE - NOT A DEPOSIT - NO BANK GUARANTEE
NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
Dear Shareholder,
(PHOTO OF WILLIAM G. PAPESH)
Securities markets have spent recent months reacting to a complicated mix of
economic data that has generally been positive for equities but challenging for
bonds. An upswing in economic growth, continuing strength in corporate profits,
and elevated energy prices prompted the Federal Reserve to continue raising
short-term interest rates in an effort to contain inflationary pressures. For
the six months ended April 30, 2006, the S&P 500 climbed 9.64%, while the Lehman
Brothers Aggregate Bond Index edged up 0.56%.(1)
REACHING A COMPANY MILESTONE
The past six months marked a significant accomplishment for the WM Group of
Funds. In January, our assets under management exceeded $20 billion for the
first time in the company's history. This growth has been building steadily over
the last few years and is partly due to the strong performance of WM Funds shown
on the following pages.
ACHIEVING LOWER EXPENSES
We take pride in our growth as a fund family but also note that this achievement
benefits our shareholders. As we gain assets under management, the WM Funds can
reach additional management fee breakpoints. This favorable consequence of
growth is among the factors that have pushed 15 of the 16 Funds listed in this
report to achieve lower expense ratios compared to their peers.(2)
Shareholders can also take advantage of services that may help lower certain
expenses. On the back cover, you'll find information about our e-delivery
program. When you choose to receive documents like this report by e-mail, you
gain the convenience of electronic delivery and storage while reducing printing
and mailing costs.
SHAPING OUR BOARD COMPOSITION
From my perspective, you can certainly be proud of your Board of Trustees and
the stewardship role they perform for your benefit. In November, Michael (Mike)
Murphy, a Director of Washington Mutual, Inc., retired from the WM Group of
Funds Board of Trustees after 11 years of diligent service. Concurrently, the
Board elected independent Trustee Richard (Dick) Yancey to the position of
chairman. Dick has been a tireless advocate of shareholder interests in the more
than three decades that he has served on our Board. Both he and Mike have my
gratitude for their many years of wise counsel.(3)
Our Board is now composed of nine members, more than 75% of whom are not
affiliated with Washington Mutual, Inc. I believe this structure, which
emphasizes independence, supports strong fund oversight and governance.
Underlying all of our efforts is the expectation that these steps can ultimately
create value for our shareholders. On behalf of everyone at the WM Group of
Funds, thank you for your support and confidence.
Sincerely,
/s/ William G. Papesh
- -------------------------------------
William G. Papesh
President
(1) The S&P 500 is a broad-based index intended to represent the U.S. equity
market. The Lehman Brothers Aggregate Bond Index is a broad-based index
intended to represent the U.S. fixed-income market. Indices are
unmanaged, and individuals cannot invest directly in an index.
(2) Compares the Funds' expense ratios as of their most recent audited annual
report (10/31/05) with the average expense ratio for each Fund's Lipper
classification as of 4/30/06. Source of peer data: Lipper, Inc.
(3) Lengths of service include board membership with Composite Funds, a
predecessor to the WM Group of Funds.
PORTFOLIO MANAGER
(GRAPHIC) REIT Fund (PHOTO) David W. Simpson, CFA
WM Advisors, Inc.
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852. Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 5.5%; Class B shares: contingent deferred sales
charge of 5%, which declines over 5 years
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
6-Month 1-Year Since Inception Inception Date
------- ------ --------------- --------------
CLASS A SHARES Net Asset Value(3) 14.49% 24.37% 27.36% 3/1/03
With Sales Charge 8.21% 17.54% 25.11%
CLASS B SHARES Net Asset Value(3) 14.04% 23.43% 26.41% 3/1/03
With Sales Charge 9.04% 18.43% 25.84%
CLASS C SHARES Net Asset Value(3) 14.09% 23.52% 26.53% 3/1/03
With Sales Charge 13.09% 22.52% 26.53%
CLASS R-1 SHARES Net Asset Value(3) 14.27% 23.77% 1.58% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 14.36% 24.03% 1.58% 3/1/06
NAREIT All REIT Index(4) 14.98% 23.63% 28.02%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 27.36% (1-year), 27.09% (since inception)
Class B Shares: 28.65% (1-year), 27.87% (since inception)
Class C Shares: 32.82% (1-year), 28.57% (since inception)
Class R-1 Shares: 34.10% (1-year), 4.67% (since inception)
Class R-2 Shares: 34.41% (1-year), 4.67% (since inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Retail 26% 26% 0%
Industrial/Office 22% 26% -4%
Residential 11% 11% 0%
Common Stocks 7% 6% +1%
Lodging/Resorts 7% 6% +1%
Health Care 5% 5% 0%
Specialty 5% 8% -3%
Hybrid 4% 1% +3%
Diversified 3% 3% 0%
Mortgage 2% 1% +1%
Self Storage 2% 2% 0%
Cash Equivalents 6% 5% +1%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C,
R-1, and R-2 shares, performance for periods prior to inception is
hypothetical, based on Class A share returns adjusted for the respective
expenses of the share class. Performance does not reflect the impact of
federal, state, or municipal taxes. If it did, performance would be lower.
(2) Periods of less than one year are not annualized.
(3) Net asset value is not adjusted for sales charge.
2
PORTFOLIO MANAGER Equity Income Fund* (GRAPHIC)
Joseph T. Suty, CFA (PHOTO)
WM Advisors, Inc.
(5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on
redemptions made during the first 12 months. See the prospectus for
details. Performance listed with sales charge reflects the maximum sales charge.
REIT securities are subject to risk factors associated with the real estate
industry and tax factors of REIT registration.
* As of 8/1/00, the WM Bond & Stock Fund became the WM Equity Income Fund,
and the Fund's objectives and strategies changed. This information should
be considered when reviewing past performance. Please see the prospectus
for detailed information.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
6-Month 1-Year 5-Year 10-Year Since Inception Inception Date
------- ------ ------ ------- --------------- --------------
CLASS A SHARES Net Asset Value(3) 11.32% 18.55% 10.27% 11.14% 9.15% 5/31/39
With Sales Charge 5.19% 12.01% 9.03% 10.52% 9.06%
CLASS B SHARES Net Asset Value(3) 10.85% 17.53% 9.29% 10.37% 11.43% 3/30/94
With Sales Charge 5.85% 12.53% 9.01% 10.37% 11.43%
CLASS C SHARES Net Asset Value(3) 10.91% 17.58% 9.40% 10.27% 10.92% 3/1/02
With Sales Charge 9.91% 16.58% 9.40% 10.27% 10.92%
CLASS R-1 SHARES Net Asset Value(3) 11.03% 17.82% 9.55% 10.44% 4.03% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 11.13% 18.06% 9.82% 10.71% 4.03% 3/1/06
S&P 500/Barra Value Index(4) 12.77% 20.02% 4.14% 9.48% --
S&P 500(4) 9.64% 15.42% 2.70% 8.94% 11.60%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 8.97% (1-year), 9.29% (5-year), 10.33% (10-year), 9.03% (since
inception)
Class B Shares: 9.28% (1-year), 9.26% (5-year), 10.19% (10-year), 11.29% (since
inception)
Class C Shares: 13.37% (1-year), 9.66% (5-year), 10.08% (10-year), 10.53% (since
inception)
Class R-1 Shares: 14.58% (1-year), 9.81% (5-year), 10.25% (10-year), 1.65%
(since inception)
Class R-2 Shares: 14.84% (1-year), 10.08% (5-year), 10.52% (10-year), 1.65%
(since inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Financials 26% 24% +2%
Industrials 13% 11% +2%
Energy 10% 11% -1%
Health Care 10% 7% +3%
Information Technology 9% 8% +1%
Consumer Staples 7% 6% +1%
Telecommunication Services 6% 3% +3%
REITs 5% 7% -2%
Consumer Discretionary 4% 6% -2%
Materials 4% 3% +1%
U.S. Treasuries 1% 2% -1%
Utilities 1% 4% -3%
Other 1% 3% -2%
Cash Equivalents 3% 5% -2%
(4) See page 18 for definitions of indices. Returns shown for the indices
assume reinvestment of all dividends and distributions. The since-inception
return shown for the NAREIT ALL REIT Index is calculated from 2/28/03. The
since-inception return shown for the S&P 500 is calculated from 5/31/39.
Indices are unmanaged, and individuals cannot invest directly in an index.
(5) May not reflect the current portfolio composition.
3
PORTFOLIO MANAGER
(GRAPHIC) Growth & Income Fund (PHOTO) Stephen Q. Spencer, CFA
WM Advisors, Inc.
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852.Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 5.5%; Class B shares: contingent deferred sales
charge of 5%, which declines over 5 years
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 8.35% 10.73% 1.96% 8.69% 10.13% 10/31/49
With Sales Charge 2.41% 4.66% 0.81% 8.07% 10.02%
CLASS B SHARES Net Asset Value(3) 7.78% 9.58% 0.94% 7.92% 10.12% 3/30/94
With Sales Charge 2.77% 4.58% 0.55% 7.92% 10.12%
CLASS C SHARES Net Asset Value(3) 7.96% 9.79% 1.02% 7.74% 4.43% 3/1/02
With Sales Charge 6.96% 8.79% 1.02% 7.74% 4.43%
CLASS R-1 SHARES Net Asset Value(3) 8.09% 10.08% 1.28% 8.00% 2.93% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 8.18% 10.31% 1.52% 8.26% 2.93% 3/1/06
S&P 500(4) 9.64% 15.42% 2.70% 8.94% 12.05%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 1.28% (1-year), 1.38% (5-year), 8.11% (10-year), 9.99% (since
inception)
Class B Shares: 1.05% (1-year), 1.14% (5-year), 7.96% (10-year), 10.02% (since
inception)
Class C Shares: 5.26% (1-year), 1.59% (5-year), 7.78% (10-year), 4.04% (since
inception)
Class R-1 Shares: 6.47% (1-year), 1.84% (5-year), 8.03% (10-year), 0.94% (since
inception)
Class R-2 Shares: 6.71% (1-year), 2.09% (5-year), 8.30% (10-year), 0.94% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Financials 22% 22% 0%
Health Care 14% 11% +3%
Industrials 13% 11% +2%
Information Technology 13% 13% 0%
Energy 12% 9% +3%
Consumer Staples 8% 10% -2%
Consumer Discretionary 7% 10% -3%
Materials 3% 2% +1%
Utilities 3% 5% -2%
Telecommunication Services 2% 1% +1%
Cash Equivalents 3% 6% -3%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C,
R-1,and R-2 shares, performance for periods prior to inception is
hypothetical, based on Class A share returns adjusted for the respective
expenses of the share class. Performance does not reflect the impact of
federal, state, or municipal taxes. If it did, performance would be lower.
The West Coast Equity Fund's performance in 1997 benefited from the
agreement of WM Advisors and its affiliates to limit the Fund's expenses.
(2) Periods of less than one year are not annualized.
(3) Net asset value is not adjusted for sales charge.
4
PORTFOLIO MANAGER West Coast Equity Fund (GRAPHIC)
Philip M. Foreman, CFA (PHOTO)
WM Advisors, Inc.
(5-5-4-3-2-0%);Class C shares: contingent deferred sales charge of 1% on
redemptions made during the first 12 months. See the prospectus for
details. Performance listed with sales charge reflects the maximum sales charge.
West Coast Equity Fund: Small-cap and mid-cap stocks may have additional risks,
including greater price volatility. There may be additional investment risks due
to the Fund's concentration in West Coast companies.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 11.76% 24.32% 8.29% 15.25% 14.90% 11/24/86
With Sales Charge 5.61% 17.48% 7.08% 14.60% 14.56%
CLASS B SHARES Net Asset Value(3) 11.24% 23.19% 7.27% 14.42% 14.93% 3/30/94
With Sales Charge 6.24% 18.19% 6.97% 14.42% 14.93%
CLASS C SHARES Net Asset Value(3) 11.29% 23.29% 7.35% 14.25% 8.93% 3/1/02
With Sales Charge 10.29% 22.29% 7.35% 14.25% 8.93%
CLASS R-1 SHARES Net Asset Value(3) 11.50% 23.61% 7.64% 14.59% 2.27% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 11.59% 23.86% 7.90% 14.87% 2.27% 3/1/06
Russell 3000(R) Index(4) 10.70% 18.08% 3.94% 9.10% 11.45%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 13.32% (1-year), 9.27% (5-year), 15.44% (10-year), 14.64% (since
inception)
Class B Shares: 13.78% (1-year), 9.18% (5-year), 15.27% (10-year), 15.07% (since
inception)
Class C Shares: 17.89% (1-year), 9.54% (5-year), 15.09% (10-year), 9.21% (since
inception)
Class R-1 Shares: 19.15% (1-year), 9.83% (5-year), 15.43% (10-year), 2.55%
(since inception)
Class R-2 Shares: 19.43% (1-year), 10.10% (5-year), 15.72% (10-year), 2.55%
(since inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Financials 17% 18% -1%
Information Technology 17% 16% +1%
Health Care 16% 17% -1%
Industrials 16% 15% +1%
Consumer Discretionary 12% 12% 0%
Energy 7% 7% 0%
Consumer Staples 5% 5% 0%
Materials 4% 3% +1%
REITs 3% 3% 0%
Telecommunication Services 0% 1% -1%
Cash Equivalents 3% 3% 0%
(4) See page 18 for definitions of indices. Returns shown for the indices
assume reinvestment of all dividends and distributions. The since-inception
return shown for the S&P 500 is calculated from 10/31/49. The
since-inception return shown for the Russell 3000(R) Index is calculated
from 11/30/86. Indices are unmanaged, and individuals cannot invest
directly in an index.
(5) May not reflect the current portfolio composition.
5
PORTFOLIO MANAGER
(GRAPHIC) Mid Cap Stock Fund (PHOTO) Daniel R. Coleman
WM Advisors, Inc.
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852. Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 5.5%; Class B shares: contingent deferred sales
charge of 5%,which declines over 5 years
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year Inception Date
------- ------ ------ --------- ---------
CLASS A SHARES Net Asset Value(3) 14.43% 26.25% 11.07% 15.08% 3/1/00
With Sales Charge 8.13% 19.33% 9.82% 14.03%
CLASS B SHARES Net Asset Value(3) 13.88% 25.06% 10.01% 14.00% 3/1/00
With Sales Charge 8.88% 20.06% 9.73% 14.00%
CLASS C SHARES Net Asset Value(3) 13.97% 25.20% 10.06% 11.78% 3/1/02
With Sales Charge 12.97% 24.20% 10.06% 11.78%
CLASS R-1 SHARES Net Asset Value(3) 14.16% 25.51% 10.43% 5.11% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 14.25% 25.77% 10.70% 5.11% 3/1/06
S&P MidCap 400(4) 15.26% 28.32% 10.73% 10.62%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 14.68% (1-year), 10.78% (5-year), 14.04% (since inception)
Class B Shares: 15.14% (1-year), 10.68% (5-year), 14.01% (since inception)
Class C Shares: 19.28% (1-year), 11.01% (5-year), 11.76% (since inception)
Class R-1 Shares: 20.55% (1-year), 11.38% (5-year), 4.02% (since inception)
Class R-2 Shares: 20.82% (1-year), 11.66% (5-year), 4.02% (since inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Financials 19% 18% +1%
Industrials 17% 15% +2%
Consumer Discretionary 13% 12% +1%
Information Technology 12% 12% 0%
Health Care 11% 12% -1%
Energy 8% 8% 0%
Materials 5% 5% 0%
Utilities 4% 6% -2%
REITs 2% 2% 0%
Consumer Staples 1% 3% -2%
Telecommunication Services 1% 0% +1%
Cash Equivalents 7% 7% 0%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C,
R-1,and R-2 shares, performance for periods prior to inception is
hypothetical, based on Class A share returns adjusted for the respective
expenses of the share class. Performance does not reflect the impact of
federal, state, or municipal taxes. If it did, performance would be lower.
The Growth Fund's performance between 1999 and 2000 benefited from the
agreement of WM Advisors and its affiliates to limit the Fund's expenses.
(2) Periods of less than one year are not annualized.
(3) Net asset value is not adjusted for sales charge.
6
PORTFOLIO MANAGERS
Alan Blake, CFA Growth Fund (GRAPHIC)
Salomon Brothers Asset Management, Inc
E. Marc Pinto, CFA
Janus Capital Management LLC
William L. Wilby, CFA & Marc L. Baylin, CFA
Oppenheimer Funds, Inc.
(5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on
redemptions made during the first 12 months. See the prospectus for
details. Performance listed with sales charge reflects the maximum sales charge.
Mid Cap Stock Fund: Small-cap and mid-cap stocks may have additional
risks, including greater price volatility. Growth Fund: International investing
involves increased risks due to currency fluctuations, political or social
instability, and differences in accounting standards.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 5.39% 13.45% -4.49% 6.69% 10.03% 4/5/93
With Sales Charge -0.42% 7.23% -5.56% 6.09% 9.56%
CLASS B SHARES Net Asset Value(3) 4.89% 12.37% -5.35% 6.01% 9.91% 7/1/94
With Sales Charge -0.11% 7.37% -5.85% 6.01% 9.91%
CLASS C SHARES Net Asset Value(3) 4.98% 12.57% -5.18% 5.88% 2.60% 3/1/02
With Sales Charge 3.98% 11.57% -5.18% 5.88% 2.60%
CLASS R-1 SHARES Net Asset Value(3) 5.23% 13.02% -4.81% 6.35% 0.24% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 5.31% 13.26% -4.59% 6.58% 0.24% 3/1/06
Russell 1000(R) Growth Index(4) 7.06% 15.18% -0.76% 6.21% 8.44%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 6.54% (1-year), -2.19% (5-year), 6.75% (10-year), 9.70% (since
inception)
Class B Shares: 6.72% (1-year), -2.41% (5-year), 6.67% (10-year), 10.07% (since
inception)
Class C Shares: 10.93% (1-year), -1.81% (5-year), 6.53% (10-year), 2.91% (since
inception)
Class R-1 Shares: 12.31% (1-year), -1.43% (5-year), 7.01% (10-year), 1.21%
(since inception)
Class R-2 Shares: 12.56% (1-year), -1.20% (5-year), 7.24% (10-year), 1.21%
(since inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Information Technology 30% 27% +3%
Health Care 19% 21% -2%
Consumer Discretionary 16% 20% -4%
Financials 11% 9% +2%
Consumer Staples 8% 8% 0%
Energy 6% 4% +2%
Industrials 5% 6% -1%
Materials 2% 2% 0%
Telecommunication Services 1% 1% 0%
Cash Equivalents 2% 2% 0%
(4) See page 18 for definitions of indices. Returns shown for the indices
assume reinvestment of all dividends and distributions. The since-inception
return shown for the S&P MidCap 400 is calculated from 2/29/00. The
since-inception return shown for the Russell 1000(R) Growth Index is
calculated from 3/31/93. Indices are unmanaged, and individuals cannot
invest directly in an index.
(5) May not reflect the current portfolio composition.
7
PORTFOLIO MANAGER
(GRAPHIC) Small Cap Value Fund (PHOTO) David W. Simpson, CFA
WM Advisors, Inc.
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852. Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 5.5%; Class B shares: contingent deferred sales
charge of 5%, which declines over 5 years
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year Inception Date
------- ------ --------- ---------
CLASS A SHARES Net Asset Value(3) 11.24% 11.33% 13.28% 3/1/04
With Sales Charge 5.12% 5.21% 10.38%
CLASS B SHARES Net Asset Value(3) 10.79% 10.31% 12.27% 3/1/04
With Sales Charge 5.78% 5.31% 10.65%
CLASS C SHARES Net Asset Value(3) 10.92% 10.54% 12.43% 3/1/04
With Sales Charge 8.92% 8.54% 12.43%
CLASS R-1 SHARES Net Asset Value(3) 11.00% 10.76% 1.91% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 11.09% 10.98% 1.91% 3/1/06
Russell 2000(R) Value Index(4) 17.52% 30.85% 16.08%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 3.41% (1-year), 11.67% (since inception)
Class B Shares: 3.39% (1-year), 12.04% (since inception)
Class C Shares: 6.44% (1-year), 13.83% (since inception)
Class R-1 Shares: 8.78% (1-year), 3.58% (since inception)
Class R-2 Shares: 9.03% (1-year), 3.58% (since inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Financials 14% 13% +1%
Industrials 14% 14% 0%
Materials 11% 11% 0%
Consumer Discretionary 10% 11% -1%
Energy 10% 11% -1%
Information Technology 10% 11% -1%
Consumer Staples 8% 7% +1%
Health Care 7% 6% +1%
REITs 5% 4% +1%
Telecommunication Services 4% 3% +1%
Options 1% 3% -2%
Utilities 1% 1% 0%
Cash Equivalents 5% 5% 0%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C,
R-1,and R-2 shares, performance for periods prior to inception is
hypothetical, based on Class A share returns adjusted for the respective
expenses of the share class. Performance does not reflect the impact of
federal, state, or municipal taxes. If it did, performance would be lower.
The Small Cap Growth Fund's performance between 1998 and 1999 benefited
from the agreement of WM Advisors and its affiliates to limit the Fund's
expenses.
(2) Periods of less than one year are not annualized.
(3) Net asset value is not adjusted for sales charge.
8
PORTFOLIO MANAGERS Small Cap Growth Fund (GRAPHIC)
Emerging Growth Team
Delaware Management Company
James W. Oberweis, CFA
Oberweis Asset Management, Inc.
(5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on
redemptions made during the first 12 months. See the prospectus for details.
Performance listed with sales charge reflects the maximum sales charge.
Small-cap and mid-cap stocks may have additional risks, including greater price
volatility. Small Cap Value Fund: International investing involves increased
risks due to currency fluctuations, political or social instability, and
differences in accounting standards.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
6-Month 1-Year 5-Year 10-Year Since Inception Inception Date
------- ------ ------ ------- --------------- --------------
CLASS A SHARES Net Asset Value(3) 14.93% 35.91% -0.43% 4.18% 8.57% 7/18/90
With Sales Charge 8.62% 28.39% -1.54% 3.59% 8.19%
CLASS B SHARES Net Asset Value(3) 14.33% 34.50% -1.49% 3.42% 7.42% 7/1/94
With Sales Charge 9.33% 29.50% -1.92% 3.42% 7.42%
CLASS C SHARES Net Asset Value(3) 14.54% 34.80% -1.16% 3.51% 4.99% 3/1/02
With Sales Charge 13.54% 33.80% -1.16% 3.51% 4.99%
CLASS R-1 SHARES Net Asset Value(3) 14.73% 35.28% -0.89% 3.76% 2.56% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 14.83% 35.56% -0.65% 4.00% 2.56% 3/1/06
Russell 2000(R) Growth Index(4) 20.31% 36.13% 6.05% 4.70% 8.39%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 19.17% (1-year), 1.39% (5-year), 3.98% (10-year), 8.30% (since
inception)
Class B Shares: 19.73% (1-year), 1.07% (5-year), 3.81% (10-year), 7.56% (since
inception)
Class C Shares: 24.13% (1-year), 1.79% (5-year), 3.90% (10-year), 5.35% (since
inception)
Class R-1 Shares: 25.51% (1-year), 2.05% (5-year), 4.14% (10-year), 3.52% (since
inception)
Class R-2 Shares: 25.79% (1-year), 2.30% (5-year), 4.39% (10-year), 3.52% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Health Care 24% 28% -4%
Consumer Discretionary 15% 14% +1%
Industrials 12% 11% +1%
Energy 10% 6% +4%
Semiconductors &
Semiconductor Equipment 8% 6% +2%
Communications Equipment 6% 7% -1%
Financials 5% 4% +1%
Internet Software & Services 5% 9% -4%
Software 5% 5% 0%
IT Services 3% 2% +1%
Computers & Peripherals 1% 1% 0%
Consumer Staples 1% 2% -1%
REITs 1% 1% 0%
Telecommunication Services 0% 1% -1%
Cash Equivalents 4% 3% +1%
(4) See page 18 for definitions of indices. Returns shown for the indices
assume reinvestment of all dividends and distributions. The since-inception
return shown for the Russell 2000(R) Value Index is calculated from
2/29/04. The since-inception return shown for the Russell 2000(R) Growth
Index is calculated from 7/31/90. Indices are unmanaged, and individuals
cannot invest directly in an index.
(5) May not reflect the current portfolio composition.
9
PORTFOLIO MANAGERS
(GRAPHIC) International Growth Fund Non-U.S. Equity Team & Emerging
Market Equity Team
Capital Guardian Trust Company
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852. Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 5.5% (for the International Growth Fund) or
3.5% (for the Short Term Income Fund); Class B shares:
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
6-Month 1-Year 5-Year 10-Year Since Inception Inception Date
------- ------ ------ ------- --------------- --------------
CLASS A SHARES Net Asset Value(3) 21.77% 35.53% 7.02% 5.19% 4.47% 7/18/90
With Sales Charge 15.02% 28.09% 5.81% 4.60% 4.09%
CLASS B SHARES Net Asset Value(3) 21.11% 34.08% 5.88% 4.44% 4.50% 7/1/94
With Sales Charge 16.11% 29.08% 5.56% 4.44% 4.50%
CLASS C SHARES Net Asset Value(3) 21.32% 34.45% 6.11% 4.28% 13.00% 3/1/02
With Sales Charge 20.32% 33.45% 6.11% 4.28% 13.00%
CLASS R-1 SHARES Net Asset Value(3) 21.53% 34.91% 6.75% 4.95% 7.06% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 21.63% 35.19% 6.92% 5.14% 7.06% 3/1/06
MSCI All Country World Index ex-USA(4) 25.04% 38.14% 11.43% 7.57% 7.34%
MSCI EAFE Index(4) 23.10% 34.00% 9.59% 7.03% 6.89%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 19.76% (1-year), 6.72% (5-year), 4.32% (10-year), 3.84% (since
inception)
Class B Shares: 20.46% (1-year), 6.51% (5-year), 4.18% (10-year), 4.16% (since
inception)
Class C Shares: 24.60% (1-year), 7.02% (5-year), 4.00% (10-year), 12.15% (since
inception)
Class R-1 Shares: 26.15% (1-year), 7.67% (5-year), 4.66% (10-year), 2.74% (since
inception)
Class R-2 Shares: 26.44% (1-year), 7.85% (5-year), 4.85% (10-year), 2.74% (since
inception)
GEOGRAPHIC BREAKDOWN(5)
As of 4/30/06
(PIE CHART)
As of As of
Country 4/30/06 10/31/05 Change
- ------- ------- -------- ------
Japan 24% 29% -5%
United Kingdom 13% 16% -3%
France 8% 9% -1%
Switzerland 6% 8% -2%
Canada 5% 4% +1%
Germany 5% 7% -2%
Netherlands 4% 6% -2%
South Korea 4% 1% +3%
South Africa 3% 1% +2%
Spain 3% 5% -2%
Other Countries 22% 11% +11%
Cash Equivalents 3% 3% 0%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C, R-1,
and R-2 shares, performance for periods prior to inception is hypothetical,
based on Class A share returns adjusted for the respective expenses of the
share class. Performance does not reflect the impact of federal, state, or
municipal taxes. If it did, performance would be lower. The Short Term
Income Fund's performance between 1995 and 2005 benefited from the
agreement of WM Advisors and its affiliates to limit the Fund's expenses.
(2) Periods of less than one year are not annualized.
(3) Net asset value is not adjusted for sales charge.
10
PORTFOLIO MANAGER Short Term Income Fund (GRAPHIC)
Craig V. Sosey (PHOTO)
WM Advisors, Inc.
contingent deferred sales charge of 5% (for the International Growth Fund),
which declines over 5 years (5-5-4-3-2-0%), or 4% (for the Short Term Income
Fund), which declines over 4 years (4-4-3-2-0%); Class C shares: contingent
deferred sales charge of 1% on redemptions made during the first 12 months. See
the prospectus for details. Performance listed with sales charge reflects the
maximum sales charge.
International Growth Fund: International investing, especially in emerging
markets, involves increased risks due to currency fluctuations, political or
social instability, and differences in accounting standards. Short Term Income
Fund: Fixed-income investments are subject to interest rate risk, and their
value will decline as interest rates rise.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 1.36% 1.88% 3.71% 4.90% 4.52% 11/1/93
With Sales Charge -2.03% -1.48% 2.93% 4.54% 4.23%
CLASS B SHARES Net Asset Value(3) 0.99% 1.13% 2.94% 4.27% 4.32% 7/1/94
With Sales Charge -3.01% -2.87% 2.94% 4.27% 4.32%
CLASS C SHARES Net Asset Value(3) 1.00% 1.14% 2.93% 4.05% 2.37% 3/1/02
With Sales Charge 0.00% 0.14% 2.93% 4.05% 2.37%
CLASS R-1 SHARES Net Asset Value(3) 0.48% 0.61% 2.86% 4.06% -0.43% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 0.56% 0.82% 3.11% 4.31% -0.43% 3/1/06
Citigroup Broad Investment-Grade
Credit 1-3 Years Index(4) 1.69% 2.79% 4.46% 5.72% 5.70%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: -1.09% (1-year), 2.97% (5-year), 4.47% (10-year), 4.23% (since
inception)
Class B Shares: -2.46% (1-year), 2.97% (5-year), 4.20% (10-year), 4.32% (since
inception)
Class C Shares: 1.00% (1-year), 3.06% (5-year), 4.03% (10-year), 2.46% (since
inception)
Class R-1 Shares: 1.26% (1-year), 2.95% (5-year), 4.01% (10-year), -0.43% (since
inception)
Class R-2 Shares: 1.49% (1-year), 3.20% (5-year), 4.27% (10-year), -0.43% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Domestic Corporate Bonds 52% 49% +3%
Mortgage-Backed Bonds 17% 18% -1%
U.S. Government Agency 10% 10% 0%
U.S. Treasuries 6% 6% 0%
Asset-Backed Bonds 5% 5% 0%
Foreign Corporate
Bonds (U.S.$) 5% 5% 0%
Cash Equivalents 5% 7% -2%
(4) See page 18 for definitions of indices. Effective 3/1/06, the Morgan
Stanley Capital International (MSCI) All Country World Index ex-USA
replaced the MSCI EAFE Index because WM Advisors and the Fund's subadvisor
believe the new benchmark more accurately reflects the International Growth
Fund's performance characteristics. Returns shown for the indices assume
reinvestment of all dividends and distributions. Since-inception returns
shown for the MSCI All Country World Index ex-USA and the MSCI EAFE Index
are calculated from 7/31/90. The since-inception return shown for the
Citigroup Broad Investment-Grade Credit 1-3 Years Index is calculated from
10/31/93. Indices are unmanaged, and individuals cannot invest directly in
an index.
(5) May not reflect the current portfolio composition.
11
PORTFOLIO MANAGER
(GRAPHIC) U.S. Government Securities Fund (PHOTO) Craig V. Sosey
WM Advisors, Inc.
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852. Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 4.5%; Class B shares: contingent deferred sales
charge of 5%, which declines over 5 years
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 0.82% 0.82% 3.97% 5.57% 7.46% 5/4/84
With Sales Charge -3.75% -3.74% 3.02% 5.08% 7.24%
CLASS B SHARES Net Asset Value(3) 0.45% 0.09% 3.22% 4.91% 5.16% 3/30/94
With Sales Charge -4.55% -4.91% 2.86% 4.91% 5.16%
CLASS C SHARES Net Asset Value(3) 0.46% 0.18% 3.22% 4.89% 2.42% 3/1/02
With Sales Charge -0.54% -0.82% 3.22% 4.89% 2.42%
CLASS R-1 SHARES Net Asset Value(3) -0.16% -0.48% 3.18% 4.89% -1.61% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) -0.07% -0.28% 3.43% 5.15% -1.61% 3/1/06
Citigroup Mortgage Index(4) 1.23% 1.60% 4.88% 6.27% 9.00%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: -2.61% (1-year), 3.00% (5-year), 5.01% (10-year), 7.27% (since
inception)
Class B Shares: -3.80% (1-year), 2.85% (5-year), 4.84% (10-year), 5.19% (since
inception)
Class C Shares: 0.20% (1-year), 3.20% (5-year), 4.82% (10-year), 2.48% (since
inception)
Class R-1 Shares: 0.96% (1-year), 3.23% (5-year), 4.86% (10-year), -1.23% (since
inception)
Class R-2 Shares: 1.19% (1-year), 3.48% (5-year), 5.11% (10-year), -1.23% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
FHLMC/FGLMC 34% 33% +1%
FNMA 30% 29% +1%
CMOs 20% 18% +2%
GNMA 5% 7% -2%
U.S. Government Agency 4% 4% 0%
U.S. Treasuries 4% 5% -1%
Cash Equivalents 3% 4% -1%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C,
R-1, and R-2 shares, performance for periods prior to inception is
hypothetical, based on Class A share returns adjusted for the respective
expenses of the share class. Performance does not reflect the impact of
federal, state, or municipal taxes. If it did, performance would be lower.
The U.S. Government Securities Fund's performance between 1998 and 2000 and
the Income Fund's performance in 1999 benefited from the agreement of WM
Advisors and its affiliates to limit the Funds' expenses. On 3/1/04, the
investment policies of the U.S. Government Securities Fund were modified.
As a result, the Fund's performance for periods prior to that date may not
be representative of the performance it would have achieved had its current
investment policies been in place.
(2) Periods of less than one year are not annualized.
12
PORTFOLIO MANAGERS Income Fund (GRAPHIC)
John R. Friedl, CFA and (PHOTO)
Gary J. Pokrzywinski, CFA (PHOTO)
WM Advisors, Inc.
(5-5-4-3-2-0%); Class C shares: contingent deferred sales charge of 1% on
redemptions made during the first 12 months. See the prospectus for details.
Performance listed with sales charge reflects the maximum sales charge.
Fixed-income investments are subject to interest rate risk, and their value will
decline as interest rates rise. U.S. Government Securities Fund: Neither the
principal of government bond funds nor their yields are guaranteed by the U.S.
government.
Income Fund: Lower-rated securities are subject to additional credit and default
risks.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
6-Month 1-Year 5-Year 10-Year Since Inception Inception Date
------- ------ ------ ------- --------------- --------------
CLASS A SHARES Net Asset Value(3) 1.68% 2.02% 5.84% 6.56% 8.32% 12/15/75
With Sales Charge -2.94% -2.60% 4.86% 6.07% 8.16%
CLASS B SHARES Net Asset Value(3) 1.19% 1.18% 5.08% 5.93% 6.16% 3/30/94
With Sales Charge -3.81% -3.82% 4.75% 5.93% 6.16%
CLASS C SHARES Net Asset Value(3) 1.18% 1.15% 5.07% 5.88% 4.46% 3/1/02
With Sales Charge 0.18% 0.15% 5.07% 5.88% 4.46%
CLASS R-1 SHARES Net Asset Value(3) 0.53% 0.54% 5.00% 5.86% -1.65% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 0.61% 0.75% 5.26% 6.12% -1.65% 3/1/06
Citigroup Broad Investment-Grade
Bond Index(4) 0.55% 0.78% 5.21% 6.36% --
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: -1.78% (1-year), 4.81% (5-year), 5.99% (10-year), 8.18% (since
inception)
Class B Shares: -3.07% (1-year), 4.66% (5-year), 5.86% (10-year), 6.20% (since
inception)
Class C Shares: 0.90% (1-year), 5.01% (5-year), 5.80% (10-year), 4.57% (since
inception)
Class R-1 Shares: 1.70% (1-year), 5.03% (5-year), 5.83% (10-year), -1.21% (since
inception)
Class R-2 Shares: 1.93% (1-year), 5.28% (5-year), 6.09% (10-year), -1.21% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Domestic Corporate Bonds 58% 57% +1%
Mortgage-Backed Bonds 24% 23% +1%
U.S. Treasuries 7% 7% 0%
Foreign Corporate
Bonds (U.S.$) 6% 6% 0%
Foreign Government
Bonds (U.S.$) 1% 1% 0%
Equities 0% 1% -1%
Cash Equivalents 4% 5% -1%
(3) Net asset value is not adjusted for sales charge.
(4) See page 18 for definitions of indices. Returns shown for the indices
assume reinvestment of all dividends and distributions. The since-inception
return shown for the Citigroup Mortgage Index is calculated from 4/30/84.
Indices are unmanaged, and individuals cannot invest directly in an index.
(5) May not reflect the current portfolio composition.
13
(GRAPHIC) High Yield Fund PORTFOLIO MANAGER
(PHOTO) Gary J. Pokrzywinski, CFA
WM Advisors, Inc.
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852. Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 4.5%; Class B shares: contingent deferred sales
charge of 5%, which declines over 5 years (5-5-4-3-2-0%); Class C shares:
contingent deferred sales charge of 1% on redemptions
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
6-Month 1-Year 5-Year Since Inception Inception Date
------- ------ ------ --------------- --------------
CLASS A SHARES Net Asset Value(3) 8.23% 14.84% 11.00% 7.74% 4/8/98
With Sales Charge 3.34% 9.65% 9.99% 7.13%
CLASS B SHARES Net Asset Value(3) 7.80% 13.95% 10.20% 7.10% 5/5/98
With Sales Charge 2.80% 8.94% 9.93% 7.10%
CLASS C SHARES Net Asset Value(3) 7.81% 13.96% 10.17% 11.30% 3/1/02
With Sales Charge 6.81% 12.96% 10.17% 11.30%
CLASS R-1 SHARES Net Asset Value(3) 7.27% 13.41% 10.18% 1.08% 3/1/06
CLASS R-2 SHARES Net Asset Value(3) 6.82% 13.09% 10.34% 0.58% 3/1/06
Citigroup High Yield Market Index(4) 4.56% 8.61% 8.70% 5.27%
Average annual total returns(1, 2) (with sales charge for Class A, B, and C
shares) as of 3/31/06:
Class A Shares: 7.47% (1-year), 9.61% (5-year), 6.98% (since inception)
Class B Shares: 6.64% (1-year), 9.53% (5-year), 6.96% (since inception)
Class C Shares: 10.66% (1-year), 9.80% (5-year), 11.11% (since inception)
Class R-1 Shares: 11.17% (1-year), 9.83% (5-year), -0.47% (since inception)
Class R-2 Shares: 11.42% (1-year), 10.10% (5-year), -0.47% (since inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
As of As of
Asset Class 4/30/06 10/31/05 Change
- ----------- ------- -------- ------
Domestic Corporate Bonds 83% 81% +2%
Equities 8% 10% -2%
Foreign Government
Bonds (Non-U.S.$) 3% 1% +2%
U.S. Treasuries 2% 0% +2%
Foreign Corporate
Bonds (U.S.$) 1% 4% -3%
Foreign Corporate
Bonds (Non-U.S.$) 1% 1% 0%
Foreign Government
Bonds (U.S.$) 1% 2% -1%
Cash Equivalents 1% 1% 0%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C, R-1,
and R-2 shares, performance for periods prior to inception is hypothetical,
based on Class A share returns adjusted for the respective expenses of the
share class. Performance does not reflect the impact of federal, state, or
municipal taxes. If it did, performance would be lower. The High Yield
Fund's performance between 1998 and 1999 and the Tax-Exempt Bond Fund's
performance in 2000 benefited from the agreement of WM Advisors and its
affiliates to limit the Funds' expenses.
(2) Periods of less than one year are not annualized.
(3) Net asset value is not adjusted for sales charge.
14
PORTFOLIO MANAGER Tax-Exempt Bond Fund (GRAPHIC)
Thomas M. Byron (PHOTO)
Van Kampen Asset Management
made during the first 12 months. See the prospectus for details. Performance
listed with sales charge reflects the maximum sales charge.
Fixed-income investments are subject to interest rate risk, and their value will
decline as interest rates rise.
High Yield Fund: Lower-rated securities are subject to additional credit and
default risks. International investing involves increased risks due to currency
fluctuations, political or social instability, and differences in accounting
standards. REIT securities are subject to risk factors associated with the real
estate industry and tax factors of REIT registration. Tax-Exempt Bond Fund: A
portion of the Fund's income may be subject to state and/or local taxes, and it
may be subject to federal alternative minimum tax (AMT) for certain investors.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 2.13% 2.74% 5.21% 5.19% 5.87% 1/3/77
With Sales Charge -2.44% -1.90% 4.25% 4.71% 5.70%
CLASS B SHARES Net Asset Value(3) 1.75% 1.97% 4.43% 4.54% 4.86% 3/30/94
With Sales Charge -3.25% -3.03% 4.09% 4.54% 4.86%
CLASS C SHARES Net Asset Value(3) 1.72% 1.93% 4.43% 4.38% 3.92% 3/1/02
With Sales Charge 0.72% 0.93% 4.43% 4.38% 3.92%
Lehman Brothers Municipal Bond Index(4) 1.56% 2.17% 5.39% 5.89% --
Average annual total returns(1) (with sales charge) as of 3/31/06:
Class A Shares: -0.17% (1-year), 3.93% (5-year), 4.64% (10-year), 5.72% (since
inception)
Class B Shares: -1.30% (1-year), 3.78% (5-year), 4.47% (10-year), 4.90% (since
inception)
Class C Shares: 2.66% (1-year), 4.12% (5-year), 4.32% (10-year), 4.02% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Rating 4/30/06 10/31/05 Change
- ------ ------- -------- ------
Aaa 61% 64% -3%
Aa 13% 15% -2%
A 7% 8% -1%
Baa 10% 8% +2%
Ba or lower 3% 2% +1%
Not Rated/Other 6% 3% +3%
(4) See page 18 for definitions of indices. Returns shown for the indices
assume reinvestment of all dividends and distributions. The since-inception
return shown for the Citigroup High Yield Market Index is calculated from
3/31/98. Indices are unmanaged, and individuals cannot invest directly in
an index.
(5) May not reflect the current portfolio composition. See page 18 for an
explanation of bond ratings.
15
PORTFOLIO MANAGER
(GRAPHIC) California Municipal Fund (PHOTO) Joseph A. Piraro
Van Kampen Asset Management
(GRAPHIC)
Data shown is past performance and does not guarantee future results. Current
performance, including the most recent month-end results, which may be higher or
lower than the data shown, can be obtained by calling 800-222-5852. Your
investment's return and principal value will fluctuate, so it may be worth more
or less upon redemption. A sales charge may apply as follows: Class A shares:
maximum up-front sales charge of 4.5%; Class B shares: contingent deferred sales
charge of 5%,which declines over 5 years
AVERAGE ANNUAL TOTAL RETURNS (1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 2.09% 2.78% 5.26% 5.60% 6.19% 7/25/89
With Sales Charge -2.51% -1.87% 4.30% 5.12% 5.90%
CLASS B SHARES Net Asset Value(3) 1.71% 2.01% 4.48% 4.97% 5.31% 7/1/94
With Sales Charge -3.29% -2.99% 4.15% 4.97% 5.31%
CLASS C SHARES Net Asset Value(3) 1.70% 2.00% 4.48% 4.88% 3.84% 3/1/02
With Sales Charge 0.70% 1.00% 4.48% 4.88% 3.84%
Lehman Brothers Municipal Bond Index(4) 1.56% 2.17% 5.39% 5.89% 6.63%
Average annual total returns(1) (with sales charge) as of 3/31/06:
Class A Shares: -0.10% (1-year), 3.97% (5-year), 5.12% (10-year), 5.94% (since
inception)
Class B Shares: -1.17% (1-year), 3.81% (5-year), 4.97% (10-year), 5.36% (since
inception)
Class C Shares: 2.82% (1-year), 4.15% (5-year), 4.88% (10-year), 3.96% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Rating 4/30/06 10/31/05 Change
- ------ ------- -------- ------
Aaa 55% 65% -10%
Aa 1% 1% 0%
A 11% 11% 0%
Baa 23% 14% +9%
Not Rated/Other 10% 9% +1%
(1) Performance reflects ongoing fund expenses, which may have been waived, and
assumes reinvestment of all dividends and capital gains. For Class C
shares, performance for periods prior to inception is hypothetical, based
on Class A share returns adjusted for the respective expenses of the share
class. Performance does not reflect the impact of federal, state, or
municipal taxes. If it did, performance would be lower. The California
Municipal Fund's performance between 1995 and 1999 and the California
Insured Intermediate Municipal Fund's performance between 1995 and 2003
benefited from the agreement of WM Advisors and its affiliates to limit the
Funds' expenses.
(2) Periods of less than one year are not annualized.
(3) Net asset value is not adjusted for sales charge.
16
PORTFOLIO MANAGER
Joseph A. Piraro California Insured Intermediate (GRAPHIC)
Van Kampen Asset Management Municipal Fund
(5-5-4-3-2-0%);Class C shares: contingent deferred sales charge of 1% on
redemptions made during the first 12 months. See the prospectus for details.
Performance listed with sales charge reflects the maximum sales charge.
Fixed-income investments are subject to interest rate risk, and their value will
decline as interest rates rise. A portion of the Funds' income may be subject to
state and/or local taxes, and it may be subject to federal alternative minimum
tax (AMT) for certain investors.
AVERAGE ANNUAL TOTAL RETURNS(1, 2) AS OF APRIL 30, 2006
Since Inception
6-Month 1-Year 5-Year 10-Year Inception Date
------- ------ ------ ------- --------- ---------
CLASS A SHARES Net Asset Value(3) 1.22% 1.08% 4.25% 4.73% 5.30% 4/4/94
With Sales Charge -3.32% -3.47% 3.29% 4.24% 4.90%
CLASS B SHARES Net Asset Value(3) 0.84% 0.31% 3.46% 4.10% 4.68% 7/1/94
With Sales Charge -4.16% -4.69% 3.11% 4.10% 4.68%
CLASS C SHARES Net Asset Value(3) 0.85% 0.33% 3.48% 4.03% 2.61% 3/1/02
With Sales Charge -0.16% -0.67% 3.48% 4.03% 2.61%
Lehman Brothers Municipal Bond Index(4) 1.56% 2.17% 5.39% 5.89% 6.16%
Average annual total returns(1) (with sales charge) as of 3/31/06:
Class A Shares: -1.86% (1-year), 3.03% (5-year), 4.24% (10-year), 4.94% (since
inception)
Class B Shares: -3.04% (1-year), 2.85% (5-year), 4.09% (10-year), 4.72% (since
inception)
Class C Shares: 0.97% (1-year), 3.23% (5-year), 4.02% (10-year), 2.70% (since
inception)
PORTFOLIO COMPOSITION(5)
As of 4/30/06
(PIE CHART)
As of As of
Rating 4/30/06 10/31/05 Change
- ------ ------- -------- ------
Aaa 88% 92% -4%
Aa 1% 2% -1%
A 1% 0% +1%
Baa 8% 5% +3%
Not Rated 2% 1% +1%
(4) See page 18 for a definition of the index. Returns shown for the index
assume reinvestment of all dividends and distributions. Since-inception
returns shown for the index are calculated from 7/31/89 (California
Municipal Fund) and 3/31/94 (California Insured Intermediate Municipal
Fund). Indices are unmanaged, and individuals cannot invest directly in an
index.
(5) May not reflect the current portfolio composition. See page 18 for an
explanation of bond ratings.
17
(GRAPHIC) Glossary
DEFINITIONS OF INDICES
CITIGROUP BROAD INVESTMENT-GRADE BOND INDEX:
Measures the performance of bonds, including U.S. and non-U.S. corporate
securities and non-U.S. sovereign and provincial securities. It includes
institutionally traded U.S. Treasury, government-sponsored, mortgage,
asset-backed, and investment-grade securities.
CITIGROUP BROAD INVESTMENT-GRADE CREDIT 1-3 YEARS INDEX:
Measures the performance of bonds, including U.S. and non-U.S.corporate
securities and non-U.S. sovereign and provincial securities, with maturities
between one and three years.
CITIGROUP HIGH YIELD MARKET INDEX:
Measures the performance of below-investment-grade debt issued by corporations
domiciled in the U.S. or Canada.
CITIGROUP MORTGAGE INDEX:
Represents the mortgage-backed securities component of Citigroup's Broad
Investment-Grade Bond Index. It consists of 30- and 15-year agency-issued (GNMA,
FNMA, and FHLMC) pass-through securities as well as FNMA and FHLMC balloon
mortgages.
LEHMAN BROTHERS AGGREGATE BOND INDEX:
A broad-based index intended to represent the U.S. fixed-income market.
LEHMAN BROTHERS MUNICIPAL BOND INDEX:
A total return performance benchmark for the long-term, investment-grade,
tax-exempt bond market.
MORGAN STANLEY CAPITAL INTERNATIONAL (MSCI) ALL COUNTRY WORLD INDEX EX-USA:
A float-adjusted market-capitalization index that is designed to measure equity
market performance in the global developed and emerging markets, excluding the
United States. The index consists of 48 developed and emerging market country
indices.
MORGAN STANLEY CAPITAL INTERNATIONAL (MSCI) EAFE INDEX:
A broad-based, capitalization-weighted index of equity markets representing 21
countries in Europe, Australasia, and the Far East.
NATIONAL ASSOCIATION OF REAL ESTATE INVESTMENT TRUST (NAREIT) ALL REIT INDEX:
Reflects the aggregate performance of all publicly traded REITs that own,
develop, and manage properties.
RUSSELL 1000(R) GROWTH INDEX:
Measures the performance of those Russell 1000(R) Index securities with higher
price-to-book ratios and higher forecasted growth values.
RUSSELL 2000(R) GROWTH INDEX:
Measures the performance of those Russell 2000(R) Index securities with higher
price-to-book ratios and higher forecasted growth values.
RUSSELL 2000(R) VALUE INDEX:
Measures the performance of those Russell 2000(R) Index securities with lower
price-to-book ratios and lower forecasted growth values.
RUSSELL 3000(R) INDEX:
Measures the performance of the 3,000 largest U.S. companies based on total
market capitalization, which represents approximately 98% of the investable
U.S. equity market.
S&P 500:
A broad-based index intended to represent the U.S. equity market.
S&P 500/BARRA VALUE INDEX:
An index constructed by ranking the securities in the S&P 500 by price-to-book
ratio and including the securities with the lowest price-to-book ratios that
represent approximately half of the market capitalization of the S&P 500.
S&P MIDCAP 400:
A weighted index of the common stocks of 400 mid-size companies.
DEFINITIONS OF TERMS
BOND RATINGS:
Provided by Moody's Investors Service (Moody's). If an issue is not rated by
Moody's, its Standard & Poor's rating or Fitch rating is converted to the
equivalent Moody's rating and incorporated (non-rated issues are not classified
by these rating services). The ratings represent the company's opinion of the
credit quality of securities and are intended to reflect the issuer's ability to
pay back principal and interest.
18
Expense Information
WM GROUP OF FUNDS
As a shareholder of the REIT Fund, Equity Income Fund, Growth & Income Fund,
West Coast Equity Fund, Mid Cap Stock Fund, Growth Fund, Small Cap Value Fund,
Small Cap Growth Fund, International Growth Fund, Short Term Income Fund, U.S.
Government Securities Fund, Income Fund, High Yield Fund, Tax-Exempt Bond Fund,
California Municipal Fund, or California Insured Intermediate Municipal Fund
(collectively, the "Funds"), you incur two types of costs: (1) transaction
costs, including sales charges (loads) on purchase of Class A shares, and, if
applicable, contingent deferred sales charges on redemption of shares and
redemption fees and (2) ongoing costs, including management fees, distribution
and/or service fees, and other Fund expenses. The example below is intended to
help you understand your ongoing costs (in dollars) of investing in the Funds
and to compare these costs with the ongoing costs of investing in other mutual
funds.
The example is based on an investment of $1,000 invested at the beginning of the
period and held for the entire period November 1, 2005, to April 30, 2006.
ACTUAL EXPENSES:
The first section of the table below provides information about actual account
values and actual expenses. You may use the information in these columns,
together with the amount you invested, to estimate the expenses that you paid
over the period. Simply divide your account value by $1,000 (for example, an
$8,600 account value divided by $1,000 = $8.60), then multiply the result by the
number in the third column under the heading entitled "Expenses Paid During
Period" to estimate the expenses you paid on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES:
The second section of the table below provides information about hypothetical
account values and hypothetical expenses based on each Fund's actual expense
ratio and an assumed rate of return of 5% per year before expenses (rather than
each Fund's actual rate of return). The hypothetical account values and expenses
may not be used to estimate the actual ending balance or expenses you paid for
the period. You may use this information to compare the ongoing costs of
investing in the Funds and other mutual funds. To do so, compare this 5%
hypothetical example with the 5% hypothetical examples that appear in the
shareholder reports of the other mutual funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads). Therefore, the hypothetical section of the table is useful in
comparing ongoing costs only, and will not help you compare the relative total
costs of owning different mutual funds. In addition, if these transactional
costs were included, the cost shown would have been higher.
HYPOTHETICAL
ACTUAL EXPENSES (5% RETURN BEFORE EXPENSES)
--------------------------------- ---------------------------------
EXPENSES EXPENSES
BEGINNING ENDING PAID DURING BEGINNING ENDING PAID DURING
ACCOUNT ACCOUNT PERIOD* ACCOUNT ACCOUNT PERIOD*
VALUE VALUE 11/1/05- VALUE VALUE 11/1/05- EXPENSE
11/1/05 4/30/06 4/30/06 11/1/05 4/30/06 4/30/06 RATIO
--------- ------- ----------- --------- ------- ----------- -------
REIT Fund
Class A ............... $1,000 $1,145 $ 6.97 $1,000 $1,018 $ 6.56 1.31%
Class B ............... 1,000 1,140 11.20 1,000 1,014 10.54 2.11%
Class C ............... 1,000 1,141 10.62 1,000 1,015 9.99 2.00%
Class I ............... 1,000 1,148 4.58 1,000 1,021 4.31 0.86%
Class R-1 ............. 1,000 1,016 9.55 1,000 1,015 9.54 1.91%
Class R-2 ............. 1,000 1,016 8.30 1,000 1,017 8.30 1.66%
Equity Income Fund
Class A ............... $1,000 $1,113 $ 4.61 $1,000 $1,020 $ 4.41 0.88%
Class B ............... 1,000 1,109 9.10 1,000 1,016 8.70 1.74%
Class C ............... 1,000 1,109 8.63 1,000 1,017 8.25 1.65%
Class I ............... 1,000 1,115 2.88 1,000 1,022 2.76 0.55%
Class R-1 ............. 1,000 1,040 8.09 1,000 1,008 8.00 1.60%
Class R-2 ............. 1,000 1,040 6.83 1,000 1,009 6.76 1.35%
Growth & Income Fund
Class A ............... $1,000 $1,084 $ 4.49 $1,000 $1,020 $ 4.36 0.87%
Class B ............... 1,000 1,078 9.69 1,000 1,015 9.39 1.88%
Class C ............... 1,000 1,080 9.33 1,000 1,016 9.05 1.81%
Class I ............... 1,000 1,085 2.79 1,000 1,022 2.71 0.54%
Class R-1 ............. 1,000 1,029 8.00 1,000 1,008 7.95 1.59%
Class R-2 ............. 1,000 1,029 6.74 1,000 1,009 6.71 1.34%
19
Expense Information (continued)
WM GROUP OF FUNDS
HYPOTHETICAL
ACTUAL EXPENSES (5% RETURN BEFORE EXPENSES)
--------------------------------- ---------------------------------
EXPENSES EXPENSES
BEGINNING ENDING PAID DURING BEGINNING ENDING PAID DURING
ACCOUNT ACCOUNT PERIOD* ACCOUNT ACCOUNT PERIOD*
VALUE VALUE 11/1/05- VALUE VALUE 11/1/05- EXPENSE
11/1/05 4/30/06 4/30/06 11/1/05 4/30/06 4/30/06 RATIO
--------- ------- ----------- --------- ------- ----------- -------
West Coast Equity Fund
Class A ....................... $1,000 $1,118 $ 4.57 $1,000 $1,020 $ 4.36 0.87%
Class B ....................... 1,000 1,112 9.32 1,000 1,016 8.90 1.78%
Class C ....................... 1,000 1,113 8.91 1,000 1,016 8.50 1.70%
Class I ....................... 1,000 1,119 2.84 1,000 1,022 2.71 0.54%
Class R-1 ..................... 1,000 1,023 7.97 1,000 1,008 7.95 1.59%
Class R-2 ..................... 1,000 1,023 6.72 1,000 1,009 6.71 1.34%
Mid Cap Stock Fund
Class A ....................... $1,000 $1,144 $ 5.85 $1,000 $1,019 $ 5.51 1.10%
Class B ....................... 1,000 1,139 10.87 1,000 1,015 10.24 2.05%
Class C ....................... 1,000 1,140 10.29 1,000 1,015 9.69 1.94%
Class I ....................... 1,000 1,146 4.20 1,000 1,021 3.96 0.79%
Class R-1 ..................... 1,000 1,051 9.36 1,000 1,008 9.20 1.84%
Class R-2 ..................... 1,000 1,051 8.09 1,000 1,008 7.95 1.59%
Growth Fund
Class A ....................... $1,000 $1,054 $ 6.47 $1,000 $1,018 $ 6.36 1.27%
Class B ....................... 1,000 1,049 11.33 1,000 1,014 11.13 2.23%
Class C ....................... 1,000 1,050 10.32 1,000 1,015 10.14 2.03%
Class I ....................... 1,000 1,057 3.77 1,000 1,021 3.71 0.74%
Class R-1 ..................... 1,000 1,002 8.89 1,000 1,008 8.95 1.79%
Class R-2 ..................... 1,000 1,002 7.65 1,000 1,009 7.70 1.54%
Small Cap Value Fund
Class A ....................... $1,000 $1,112 $ 7.02 $1,000 $1,018 $ 6.71 1.34%
Class B ....................... 1,000 1,108 11.81 1,000 1,014 11.28 2.26%
Class C ....................... 1,000 1,109 10.88 1,000 1,014 10.39 2.08%
Class I ....................... 1,000 1,116 4.72 1,000 1,020 4.51 0.90%
Class R-1 ..................... 1,000 1,019 9.76 1,000 1,008 9.74 1.95%
Class R-2 ..................... 1,000 1,019 8.51 1,000 1,008 8.50 1.70%
Small Cap Growth Fund
Class A ....................... $1,000 $1,149 $ 7.46 $1,000 $1,018 $ 7.00 1.40%
Class B ....................... 1,000 1,143 13.44 1,000 1,012 12.62 2.53%
Class C ....................... 1,000 1,145 11.49 1,000 1,014 10.79 2.16%
Class I ....................... 1,000 1,152 4.96 1,000 1,020 4.66 0.93%
Class R-1 ..................... 1,000 1,026 9.94 1,000 1,007 9.89 1.98%
Class R-2 ..................... 1,000 1,026 8.69 1,000 1,008 8.65 1.73%
International Growth Fund
Class A ....................... $1,000 $1,218 $ 7.15 $1,000 $1,018 $ 6.51 1.30%
Class B ....................... 1,000 1,211 12.88 1,000 1,013 11.73 2.35%
Class C ....................... 1,000 1,213 11.47 1,000 1,014 10.44 2.09%
Class I ....................... 1,000 1,220 5.06 1,000 1,020 4.61 0.92%
Class R-1 ..................... 1,000 1,071 10.11 1,000 1,008 9.84 1.97%
Class R-2 ..................... 1,000 1,071 8.83 1,000 1,008 8.60 1.72%
Short Term Income Fund
Class A ....................... $1,000 $1,014 $ 4.74 $1,000 $1,020 $ 4.76 0.95%
Class B ....................... 1,000 1,010 8.42 1,000 1,016 8.45 1.69%
Class C ....................... 1,000 1,010 8.32 1,000 1,017 8.35 1.67%
Class I ....................... 1,000 1,016 2.75 1,000 1,022 2.76 0.55%
Class R-1 ..................... 1,000 996 7.92 1,000 1,008 8.00 1.60%
Class R-2 ..................... 1,000 996 6.68 1,000 1,009 6.76 1.35%
U.S. Government Securities Fund
Class A ....................... $1,000 $1,008 $ 4.48 $1,000 $1,020 $ 4.51 0.90%
Class B ....................... 1,000 1,005 8.15 1,000 1,017 8.20 1.64%
Class C ....................... 1,000 1,005 8.05 1,000 1,017 8.10 1.62%
Class I ....................... 1,000 1,010 2.59 1,000 1,022 2.61 0.52%
Class R-1 ..................... 1,000 984 7.72 1,000 1,009 7.85 1.57%
Class R-2 ..................... 1,000 984 6.49 1,000 1,009 6.61 1.32%
Income Fund
Class A ....................... $1,000 $1,017 $ 4.45 $1,000 $1,020 $ 4.46 0.89%
Class B ....................... 1,000 1,012 8.18 1,000 1,017 8.20 1.64%
Class C ....................... 1,000 1,012 8.23 1,000 1,017 8.25 1.65%
Class I ....................... 1,000 1,018 2.65 1,000 1,022 2.66 0.53%
Class R-1 ..................... 1,000 984 7.77 1,000 1,008 7.90 1.58%
Class R-2 ..................... 1,000 984 6.54 1,000 1,009 6.66 1.33%
20
Expense Information (continued)
WM GROUP OF FUNDS
HYPOTHETICAL
ACTUAL EXPENSES (5% RETURN BEFORE EXPENSES)
--------------------------------- ---------------------------------
EXPENSES EXPENSES
BEGINNING ENDING PAID DURING BEGINNING ENDING PAID DURING
ACCOUNT ACCOUNT PERIOD* ACCOUNT ACCOUNT PERIOD*
VALUE VALUE 11/1/05- VALUE VALUE 11/1/05- EXPENSE
11/1/05 4/30/06 4/30/06 11/1/05 4/30/06 4/30/06 RATIO
--------- ------- ----------- --------- ------- ----------- -------
High Yield Fund
Class A ....................... $1,000 $1,082 $4.65 $1,000 $1,020 $4.51 0.90%
Class B ....................... 1,000 1,078 8.60 1,000 1,017 8.35 1.67%
Class C ....................... 1,000 1,078 8.50 1,000 1,017 8.25 1.65%
Class I ....................... 1,000 1,084 2.95 1,000 1,022 2.86 0.57%
Class R-1 ..................... 1,000 1,011 8.08 1,000 1,008 8.10 1.62%
Class R-2 ..................... 1,000 1,006 6.81 1,000 1,009 6.85 1.37%
Tax-Exempt Bond Fund
Class A ....................... $1,000 $1,021 $4.31 $1,000 $1,021 $4.31 0.86%
Class B ....................... 1,000 1,018 8.05 1,000 1,017 8.05 1.61%
Class C ....................... 1,000 1,017 8.25 1,000 1,017 8.25 1.65%
California Municipal Fund
Class A ....................... $1,000 $1,021 $4.21 $1,000 $1,021 $4.21 0.84%
Class B ....................... 1,000 1,017 7.95 1,000 1,017 7.95 1.59%
Class C ....................... 1,000 1,017 8.00 1,000 1,017 8.00 1.60%
California Insured Intermediate
Municipal Fund
Class A ....................... $1,000 $1,012 $4.29 $1,000 $1,021 $4.31 0.86%
Class B ....................... 1,000 1,008 8.07 1,000 1,017 8.10 1.62%
Class C ....................... 1,000 1,009 8.02 1,000 1,017 8.05 1.61%
* Expenses are equal to each Fund's annualized expense ratio, multiplied by
the average account value over the period, multiplied by the 181 days in
the most recent fiscal half-year, divided by 365 days in the year (to
reflect the one-half year period).
21
Financial Statements:
Portfolio of Investments
REIT FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
REAL ESTATE INVESTMENT TRUSTS (REITS) - 86.4%
DIVERSIFIED - 4.7%
259,200 iStar Financial, Inc.** ................... $ 9,917
122,200 Vornado Realty Trust ...................... 11,687
-----------
Total Diversified ......................... 21,604
-----------
HEALTH CARE - 7.2%
394,300 Health Care Property Investors, Inc.** .... 10,812
68,800 Health Care REIT, Inc.** .................. 2,394
265,200 Healthcare Realty Trust, Inc.** ........... 10,043
439,000 Nationwide Health Properties, Inc.** ...... 9,447
-----------
Total Health Care ......................... 32,696
-----------
INDUSTRIAL/OFFICE - 22.4%
INDUSTRIAL - 6.4%
183,200 AMB Property Corporation .................. 9,158
115,600 EastGroup Properties, Inc. ................ 5,164
303,000 ProLogis .................................. 15,217
-----------
29,539
-----------
MIXED - 2.0%
253,300 Duke Realty Corporation** ................. 8,967
-----------
OFFICE - 14.0%
194,500 Alexandria Real Estate Equities, Inc. ..... 17,621
142,800 Boston Properties, Inc. ................... 12,605
407,400 Corporate Office Properties Trust ......... 16,907
170,300 SL Green Realty Corporation** ............. 16,860
-----------
63,993
-----------
Total Industrial/Office ................... 102,499
-----------
LODGING/RESORTS - 6.9%
559,300 Equity Inns, Inc. ......................... 9,061
209,700 Hospitality Properties Trust .............. 9,038
415,000 Host Hotels & Resorts Inc.** .............. 8,723
435,600 Winston Hotels, Inc.** .................... 4,691
-----------
Total Lodging/Resorts ..................... 31,513
-----------
MORTGAGE/FINANCIAL - 2.1%
224,900 Redwood Trust, Inc.** ..................... 9,552
-----------
RESIDENTIAL - 10.9%
APARTMENTS - 10.9%
117,100 AvalonBay Communities, Inc. ............... 12,612
381,100 Equity Residential ........................ 17,100
98,700 Mid-America Apartment Communities, Inc. ... 5,231
541,000 United Dominion Realty Trust, Inc.** ...... 14,710
-----------
Total Residential ......................... 49,653
-----------
RETAIL - 25.1%
FREESTANDING - 1.7%
367,800 Commercial Net Lease Realty, Inc.** ....... 7,742
-----------
REGIONAL MALLS - 10.7%
332,500 General Growth Properties, Inc. ........... $ 15,611
229,300 Macerich Company .......................... 16,789
204,000 Simon Property Group, Inc. ................ 16,704
-----------
49,104
-----------
SHOPPING CENTERS - 12.7%
313,000 Developers Diversified Realty
Corporation** .......................... 16,652
180,000 Equity One, Inc. .......................... 4,136
440,300 Kimco Realty Corporation .................. 16,348
165,800 Pan Pacific Retail Properties, Inc. ....... 11,049
252,600 Weingarten Realty Investors** ............. 9,955
-----------
58,140
-----------
Total Retail .............................. 114,986
-----------
SELF STORAGE - 1.7%
103,800 Public Storage, Inc.** .................... 7,980
-----------
SPECIALTY - 5.4%
263,200 Entertainment Properties Trust ............ 10,757
124,500 Global Signal, Inc. ....................... 6,188
215,000 Plum Creek Timber Company, Inc. ........... 7,804
-----------
Total Specialty ........................... 24,749
-----------
Total REITs
(Cost $252,601) ........................ 395,232
-----------
COMMON STOCKS - 5.6%
CONSUMER DISCRETIONARY - 0.8%
CONSUMER DURABLES & APPAREL - 0.8%
127,566 D.R. Horton, Inc. ......................... 3,829
-----------
FINANCIALS - 4.8%
BANKS - 1.6%
181,000 Countrywide Financial Corporation ......... 7,359
-----------
DIVERSIFIED FINANCIALS - 0.7%
54,000 St. Joe Company** ......................... 3,033
-----------
INSURANCE - 2.5%
138,700 Fidelity National Financial, Inc.** ....... 5,823
258,547 Fidelity National Title Group, Inc.,
Class A ................................ 5,600
-----------
11,423
-----------
Total Financials .......................... 21,815
-----------
Total Common Stocks
(Cost $21,380) ......................... 25,644
-----------
CANADIAN INCOME TRUSTS - 1.8%
ENERGY - 1.8%
98,300 Enerplus Resources Fund (F)** ............. 5,268
87,100 Harvest Energy Trust (F)** ................ 2,679
-----------
7,947
-----------
Total Canadian Income Trusts
(Cost $6,734) .......................... 7,947
-----------
22 See Notes to Financial Statements.
Portfolio of Investments (continued)
REIT FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
PREFERRED REAL ESTATE INVESTMENT
TRUST (REIT) - 0.6%
(Cost $2,613)
115,100 Mills Corporation, Series E ............... $ 2,763
-----------
PRINCIPAL
AMOUNT
(000S)
- ----------
REPURCHASE AGREEMENT - 6.3%
(Cost $28,811)
$28,811 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006, to be
repurchased at $28,822,000 on 05/01/2006
(collateralized by U.S. Treasury
obligations, having various interest rates
and maturities, market value
$29,424,000) .............................. 28,811
-----------
SHORT-TERM INVESTMENT - 9.6%
(Cost $43,913)
43,913 Mellon GSL DBT II
Collateral Fund+ .......................... 43,913
-----------
TOTAL INVESTMENTS (Cost $356,052*) ....................... 110.3% 504,310
OTHER ASSETS (LIABILITIES) (NET) ......................... (10.3) (47,013)
----- -----------
NET ASSETS 100.0% $ 457,297
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006,
and have an aggregate market value of $42,824,000, representing
9.4% of the total net assets of the Fund (collateral value
$43,913,000). (See Note 7 to Financial Statements.)
+ Represents investment purchased with cash collateral for
securities loaned.
GLOSSARY OF TERMS
(F) -- Foreign Shares
See Notes to Financial Statements. 23
Portfolio of Investments
EQUITY INCOME FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 90.8%
CONSUMER DISCRETIONARY - 4.4%
AUTOMOBILES & COMPONENTS - 0.9%
401,500 Johnson Controls, Inc. .................... $ 32,742
-----------
CONSUMER DURABLES & APPAREL - 0.7%
283,000 NIKE Inc., Class B ........................ 23,161
-----------
CONSUMER SERVICES - 1.5%
689,000 Hilton Hotels Corporation ................. 18,561
961,200 McDonald's Corporation .................... 33,229
-----------
51,790
-----------
RETAILING - 1.3%
1,351,600 Gap, Inc. ................................. 24,450
276,300 Nordstrom, Inc.** ......................... 10,591
336,100 Tiffany & Company ......................... 11,727
-----------
46,768
-----------
Total Consumer Discretionary .............. 154,461
-----------
CONSUMER STAPLES - 7.2%
FOOD & STAPLES RETAILING - 1.3%
532,200 CVS Corporation ........................... 15,817
981,700 Sysco Corporation** ....................... 29,343
-----------
45,160
-----------
FOOD, BEVERAGE & TOBACCO - 3.3%
906,600 Anheuser-Busch Companies, Inc. ............ 40,416
169,500 Cadbury Schweppes PLC, Sponsored ADR** .... 6,773
290,300 Coca-Cola Enterprises Inc. ................ 5,670
396,300 Diageo PLC, Sponsored ADR** ............... 26,255
661,700 Hershey Company ........................... 35,295
-----------
114,409
-----------
HOUSEHOLD & PERSONAL PRODUCTS - 2.6%
257,700 Clorox Company ............................ 16,539
653,800 Colgate-Palmolive Company ................. 38,653
573,500 Procter & Gamble Company .................. 33,383
-----------
88,575
-----------
Total Consumer Staples .................... 248,144
-----------
ENERGY - 10.3%
706,300 Baker Hughes Inc.** ....................... 57,090
240,500 BP PLC, Sponsored ADR ..................... 17,730
330,000 Chevron Corporation 20,137
611,800 ConocoPhillips Company .................... 40,929
149,400 Enterprise Products Partners LP** ......... 3,696
695,000 GlobalSantaFe Corporation** ............... 42,541
93,800 Kinder Morgan Energy Partners LP** ........ 4,355
224,600 Kinder Morgan, Inc. ....................... 19,769
812,300 Marathon Oil Corporation .................. 64,464
427,200 Peabody Energy Corporation ................ 27,281
415,600 Schlumberger Ltd. ......................... 28,735
465,768 Valero Energy Corporation ................. 30,154
-----------
Total Energy .............................. 356,881
-----------
FINANCIALS - 25.9%
BANKS - 6.2%
901,096 Bank of America Corporation ............... $ 44,983
571,300 Countrywide Financial Corporation ......... 23,229
410,700 Mellon Financial Corporation .............. 15,455
821,700 North Fork Bancorporation, Inc. ........... 24,758
344,300 PNC Financial Services Group, Inc. ........ 24,607
176,500 SunTrust Banks, Inc. ...................... 13,649
560,000 U.S. Bancorp .............................. 17,606
744,000 Wells Fargo & Company ..................... 51,105
-----------
215,392
-----------
DIVERSIFIED FINANCIALS - 9.6%
629,200 Allied Capital Corporation** .............. 19,543
180,000 Ameriprise Financial, Inc. ................ 8,827
545,400 Bank of New York Company, Inc. ............ 19,171
178,600 Capital One Financial Corporation** ....... 15,474
1,035,333 Citigroup Inc. ............................ 51,715
262,500 Franklin Resources, Inc. .................. 24,444
310,000 Freddie Mac ............................... 18,929
270,600 Goldman Sachs Group, Inc.** ............... 43,375
550,500 ING Groep N.V., Sponsored ADR ............. 22,339
1,054,700 JPMorgan Chase & Company 47,862
535,900 Morgan Stanley ............................ 34,458
311,300 T. Rowe Price Group, Inc. ................. 26,208
-----------
332,345
-----------
INSURANCE - 10.1%
986,000 ACE Ltd.** ................................ 54,762
793,000 AFLAC Inc. ................................ 37,699
505,900 Allstate Corporation ...................... 28,578
816,100 American International Group, Inc. 53,251
276,800 Chubb Corporation ......................... 14,266
750,000 Fidelity National Financial, Inc. ......... 31,485
341,400 Hartford Financial Services Group, Inc. ... 31,385
444,100 HCC Insurance Holdings, Inc.** ............ 14,873
240,200 Lincoln National Corporation .............. 13,951
168,900 Loews Corporation ......................... 17,929
676,300 Marsh & McLennan Companies, Inc.** ........ 20,742
500,700 MetLife, Inc. ............................. 26,087
96,400 Prudential Financial, Inc. ................ 7,532
-----------
352,540
-----------
Total Financials .......................... 900,277
-----------
HEALTH CARE - 10.2%
HEALTH CARE EQUIPMENT & SERVICES - 4.6%
375,000 Becton, Dickinson & Company ............... 23,640
292,400 Cardinal Health, Inc. ..................... 19,693
387,000 Caremark Rx, Inc.+ ........................ 17,628
253,300 Roche Holding Ltd., Sponsored ADR ......... 19,419
982,500 UnitedHealth Group Inc. ................... 48,869
597,900 Wyeth ..................................... 29,100
-----------
158,349
-----------
24 See Notes to Financial Statements.
Portfolio of Investments (continued)
EQUITY INCOME FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
HEALTH CARE (CONTINUED)
PHARMACEUTICALS & BIOTECHNOLOGY - 5.6%
410,900 Abbott Laboratories ....................... $ 17,562
324,500 AstraZeneca PLC, Sponsored ADR ............ 17,890
675,100 Bristol-Myers Squibb Company .............. 17,134
285,300 Eli Lilly & Company ....................... 15,098
375,600 GlaxoSmithKline PLC, Sponsored ADR ........ 21,364
818,300 Johnson & Johnson ......................... 47,961
1,615,900 Pfizer Inc. ............................... 40,931
896,700 Schering-Plough Corporation ............... 17,324
-----------
195,264
-----------
Total Health Care ......................... 353,613
-----------
INDUSTRIALS - 12.6%
CAPITAL GOODS - 9.8%
674,000 3M Company ................................ 57,580
266,000 Boeing Company ............................ 22,198
490,600 Caterpillar Inc. .......................... 37,158
776,300 Dover Corporation ......................... 38,621
270,500 Emerson Electric Company .................. 22,979
121,200 General Dynamics Corporation .............. 7,953
966,200 General Electric Company .................. 33,421
499,200 Honeywell International Inc. .............. 21,216
716,700 ITT Industries, Inc. ...................... 40,300
329,500 Northrop Grumman Corporation** ............ 22,043
340,000 PACCAR Inc.** ............................. 24,456
185,000 Rockwell Automation, Inc. ................. 13,405
-----------
341,330
-----------
COMMERCIAL SERVICES & SUPPLIES - 0.6%
555,000 Waste Management Inc. ..................... 20,790
-----------
TRANSPORTATION - 2.2%
361,800 Union Pacific Corporation ................. 33,000
527,700 United Parcel Service, Inc., Class B ...... 42,781
-----------
75,781
-----------
Total Industrials ......................... 437,901
-----------
INFORMATION TECHNOLOGY - 9.4%
COMMUNICATIONS EQUIPMENT - 1.8%
587,000 Harris Corporation** ...................... 27,337
1,553,200 Nokia Oyj, Sponsored ADR .................. 35,195
-----------
62,532
-----------
COMPUTERS & PERIPHERALS - 2.3%
805,000 Hewlett-Packard Company ................... 26,138
666,900 International Business Machines
Corporation ............................ 54,913
-----------
81,051
-----------
IT SERVICES - 1.5%
812,600 Automatic Data Processing, Inc. ........... $ 35,819
295,400 First Data Corporation .................... 14,088
-----------
49,907
-----------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT - 3.1%
1,873,200 Applied Materials, Inc. ................... 33,624
398,200 Linear Technology Corporation** ........... 14,136
765,000 Microchip Technology Inc.** ............... 28,504
40,800 Samsung Electronics Company Ltd., GDR++ ... 13,929
499,800 Texas Instruments Inc. .................... 17,348
-----------
107,541
-----------
SOFTWARE - 0.7%
989,300 Microsoft Corporation ..................... 23,891
-----------
Total Information Technology .............. 324,922
-----------
MATERIALS - 3.5%
282,600 Alcan Inc. (F)** .......................... 14,769
1,179,000 Anglo American PLC, Unsponsored ADR ....... 25,408
550,000 Cemex SA de CV, Sponsored ADR ............. 37,136
418,300 PPG Industries, Inc. ...................... 28,076
80,800 Temple-Inland Inc. ........................ 3,752
164,200 Weyerhaeuser Company ...................... 11,571
-----------
Total Materials ........................... 120,712
-----------
TELECOMMUNICATION SERVICES - 6.3%
957,500 Alltel Corporation ........................ 61,634
1,606,800 AT&T Inc.** ............................... 42,114
407,400 BellSouth Corporation** ................... 13,762
674,500 Sprint Nextel Corporation** ............... 16,728
1,596,900 Verizon Communications Inc.** ............. 52,746
1,404,200 Vodafone Group PLC, Sponsored ADR ......... 33,279
-----------
Total Telecommunication Services .......... 220,263
-----------
UTILITIES - 1.0%
637,900 FPL Group, Inc.** ......................... 25,261
422,800 Xcel Energy, Inc.** ....................... 7,965
-----------
Total Utilities ........................... 33,226
-----------
Total Common Stocks
(Cost $2,623,278) ...................... 3,150,400
-----------
REAL ESTATE INVESTMENT TRUSTS (REITS) - 4.5%
208,100 AMB Property Corporation .................. 10,403
238,500 Archstone-Smith Trust ..................... 11,658
123,400 Developers Diversified Realty
Corporation ............................ 6,565
131,000 Duke Realty Corporation** ................. 4,637
398,000 Equity Residential** ...................... 17,858
119,600 General Growth Properties, Inc. ........... 5,615
275,400 Health Care Property Investors, Inc.** .... 7,551
918,700 Host Hotels & Resorts Inc.** .............. 19,311
177,100 Kimco Realty Corporation** ................ 6,576
81,000 Macerich Company .......................... 5,931
285,000 Plum Creek Timber Company, Inc. ........... 10,346
See Notes to Financial Statements. 25
Portfolio of Investments (continued)
EQUITY INCOME FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
REAL ESTATE INVESTMENT TRUSTS (REITS)(CONTINUED)
421,300 ProLogis .................................. $ 21,158
124,100 Public Storage, Inc.** .................... 9,541
127,100 Simon Property Group, Inc.** .............. 10,407
102,000 Vornado Realty Trust** .................... 9,755
-----------
Total REITs
(Cost $109,118) ........................ 157,312
-----------
PRINCIPAL
AMOUNT
(000S)
- ----------
CONVERTIBLE SECURITY - 0.3%
(Cost $11,466)
CONVERTIBLE BONDS AND NOTES - 0.3%
(Cost $11,466)
$ 11,650 Echostar Communications, Conv. Sub. Note,
5.750% due 05/15/2008 .................. 11,548
-----------
FIXED-INCOME SECURITIES - 1.7%
U.S. TREASURY NOTES - 1.3%
30,000 3.000% due 12/31/2006 ..................... 29,621
15,000 4.250% due 11/15/2014 ..................... 14,184
-----------
Total U.S. Treasury Notes
(Cost $44,972) ......................... 43,805
-----------
CORPORATE BONDS AND NOTES - 0.4%
1,250 American Home Products Corporation, Deb.,
7.250% due 03/01/2023 .................. 1,362
4,000 ERAC USA Finance Company, Note,
7.350% due 06/15/2008++ ................ 4,145
500 Merrill Lynch & Company, Inc., Note,
6.375% due 10/15/2008 .................. 513
4,000 TELUS Corporation, Note,
8.000% due 06/01/2011 .................. 4,395
2,000 Texas-New Mexico Power Company, Sr. Note,
6.250% due 01/15/2009 .................. 2,018
1,000 Westinghouse Electric Corporation, Deb.,
7.875% due 09/01/2023 .................. 1,055
-----------
Total Corporate Bonds and Notes
(Cost $12,844) ......................... 13,488
-----------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED
SECURITIES - 0.0%
FEDERAL HOME LOAN MORTGAGE
CORPORATION (FHLMC) - 0.0%
211 6.500% due 09/01/2030 ..................... 215
103 7.000% due 09/01/2030 ..................... 106
-----------
Total U.S. Government Agency Mortgage-
Backed Securities
(Cost $305) ............................ 321
-----------
COLLATERALIZED MORTGAGE OBLIGATION (CMO) - 0.0%
(Cost $250)
249 Reilly Mortgage FHA, Series 1982,
(Partial default),
7.430% due 08/01/2022 .................. 249@
-----------
Total Fixed-Income Securities
(Cost $58,371) ......................... 57,863
-----------
VALUE
SHARES (000S)
- ------ -----------
WARRANTS - 0.0%
(Cost $0)
4,500 V2 Music Holdings PLC,
Expires 05/07/2008+,++ ................. $ 0
-----------
PRINCIPAL
AMOUNT
(000S)
- ----------
REPURCHASE AGREEMENT - 2.3%
(Cost $79,492)
$ 79,492 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006, to be
repurchased at 79,523,000 on 05/01/2006
(collateralized by U.S. Treasury
obligations having various interest rates
and maturities, market value
$81,182,000) .............................. 79,492
-----------
SHORT-TERM INVESTMENT - 5.8%
(Cost $200,715)
200,715 Mellon GSLDBT II
Collateral Fund+++ ..................... 200,715
-----------
TOTAL INVESTMENTS (Cost $3,082,440*) ..................... 105.4% 3,657,330
OTHER ASSETS (LIABILITIES) (NET) ......................... (5.4) (188,418)
----- -----------
NET ASSETS ............................................... 100.0% $ 3,468,912
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006, and have an
aggregate market value of $194,406,000, representing 5.6% of the total net
assets of the Fund (collateral value $200,715,000). (See Note 7 to
Financial Statements.)
+ Non-income producing security.
++ Security acquired in a transaction exempt from registration under Rule
144A of the Securities Act of 1933, as amended.
+++ Represents investment purchased with cash collateral for securities loaned.
@ Represents fair value as determined in good faith under the direction of
the Board of Trustees.
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
(F) -- Foreign Shares
FHA -- Federal Housing Authority
GDR -- Global Depositary Receipt
26 See Notes to Financial Statements.
Portfolio of Investments
GROWTH & INCOME FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 96.8%
CONSUMER DISCRETIONARY - 6.5%
CONSUMER SERVICES - 2.3%
1,151,000 Carnival Corporation** .................... $ 53,890
-----------
MEDIA - 3.0%
699,500 CBS Corporation, Class B .................. 17,816
1,072,999 Comcast Corporation, Class A+** ........... 33,209
514,500 Viacom Inc., Class B+ ..................... 20,493
-----------
71,518
-----------
RETAILING - 1.2%
484,000 Kohl's Corporation+ ....................... 27,026
-----------
Total Consumer Discretionary .............. 152,434
-----------
CONSUMER STAPLES - 8.3%
FOOD & STAPLES RETAILING - 3.5%
512,000 Costco Wholesale Corporation .............. 27,868
1,157,800 Kroger Company ............................ 23,457
695,000 Wal-Mart Stores, Inc. ..................... 31,296
-----------
82,621
-----------
FOOD, BEVERAGE & TOBACCO - 3.1%
510,100 Hershey Company ........................... 27,209
793,000 PepsiCo, Inc. ............................. 46,184
-----------
73,393
-----------
HOUSEHOLD & PERSONAL PRODUCTS - 1.7%
677,000 Procter & Gamble Company .................. 39,408
-----------
Total Consumer Staples .................... 195,422
-----------
ENERGY - 11.8%
617,000 BP PLC, Sponsored ADR ..................... 45,485
595,000 ENSCO International Inc. .................. 31,827
852,000 ExxonMobil Corporation .................... 53,744
1,127,000 GlobalSantaFe Corporation** ............... 68,984
318,000 National-Oilwell Varco Inc.+** ............ 21,932
806,000 Schlumberger Ltd. ......................... 55,727
-----------
Total Energy .............................. 277,699
-----------
FINANCIALS - 22.4%
BANKS - 7.1%
1,448,000 Bank of America Corporation ............... 72,284
764,000 Wachovia Corporation ...................... 45,726
719,000 Wells Fargo & Company ..................... 49,388
-----------
167,398
-----------
DIVERSIFIED FINANCIALS - 7.3%
1,135,000 Citigroup Inc. ............................ 56,693
755,000 Freddie Mac ............................... 46,100
1,481,000 JPMorgan Chase & Company .................. 67,208
-----------
170,001
-----------
INSURANCE - 8.0%
984,800 ACE Ltd. .................................. $ 54,696
1,063,000 Allstate Corporation ...................... 60,049
594,000 American International Group, Inc. ........ 38,758
319,000 Fidelity National Financial, Inc. ......... 13,392
231,000 Hartford Financial Services Group, Inc. ... 21,236
-----------
188,131
-----------
Total Financials .......................... 525,530
-----------
HEALTH CARE - 13.9%
HEALTH CARE EQUIPMENT & SERVICES - 6.9%
601,000 Baxter International Inc. ................. 22,658
172,000 Becton, Dickinson & Company ............... 10,843
560,000 Cardinal Health, Inc. ..................... 37,716
943,000 Medtronic, Inc.** ......................... 47,263
458,300 Omnicare, Inc.** .......................... 25,990
263,000 WellPoint Inc.+ ........................... 18,673
-----------
163,143
-----------
PHARMACEUTICALS & BIOTECHNOLOGY - 7.0%
551,000 Bristol-Myers Squibb Company** ............ 13,984
714,000 Johnson & Johnson ......................... 41,848
1,270,000 Pfizer Inc. ............................... 32,169
1,463,000 Teva Pharmaceutical Industries Ltd.,
Sponsored ADR** ........................ 59,251
352,000 Wyeth ..................................... 17,132
-----------
164,384
-----------
Total Health Care ......................... 327,527
-----------
INDUSTRIALS - 13.0%
CAPITAL GOODS - 11.8%
484,000 Boeing Company ............................ 40,390
346,000 Caterpillar Inc. .......................... 26,206
1,887,000 General Electric Company .................. 65,271
1,327,000 Honeywell International Inc. .............. 56,397
529,000 Lockheed Martin Corporation** ............. 40,151
221,000 Rockwell Automation, Inc.** ............... 16,014
1,274,000 Tyco International Ltd. ................... 33,570
-----------
277,999
-----------
COMMERCIAL SERVICES & SUPPLIES - 0.5%
329,000 Waste Management Inc. ..................... 12,325
-----------
TRANSPORTATION - 0.7%
658,000 AMR Corporation+** ........................ 16,213
-----------
Total Industrials ......................... 306,537
-----------
INFORMATION TECHNOLOGY - 13.3%
COMMUNICATIONS EQUIPMENT - 2.4%
2,020,000 Motorola, Inc. ............................ 43,127
252,000 QUALCOMM Inc. ............................. 12,938
-----------
56,065
-----------
See Notes to Financial Statements. 27
Portfolio of Investments (continued)
GROWTH & INCOME FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
INFORMATION TECHNOLOGY (CONTINUED)
COMPUTERS & PERIPHERALS - 4.3%
180,000 Apple Computer, Inc.+ ..................... $ 12,670
1,451,000 Hewlett-Packard Company ................... 47,114
517,000 International Business Machines
Corporation ............................ 42,570
-----------
102,354
-----------
IT SERVICES - 2.3%
1,133,000 First Data Corporation .................... 54,033
-----------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT - 1.7%
1,222,000 Intel Corporation ......................... 24,415
437,000 Microchip Technology Inc. ................. 16,283
-----------
40,698
-----------
SOFTWARE - 2.6%
410,000 Autodesk, Inc.+ ........................... 17,236
1,798,000 Microsoft Corporation ..................... 43,422
-----------
60,658
-----------
Total Information Technology .............. 313,808
-----------
MATERIALS - 3.0%
1,231,000 Alcoa Inc. ................................ 41,583
525,000 Anglo American PLC, Unsponsored ADR ....... 11,314
387,000 E.I. du Pont de Nemours & Company** ....... 17,067
-----------
Total Materials ........................... 69,964
-----------
TELECOMMUNICATION SERVICES - 2.1%
1,160,000 AT&T Inc. ................................. 30,404
546,000 Verizon Communications Inc. ............... 18,034
-----------
Total Telecommunication Services .......... 48,438
-----------
UTILITIES - 2.5%
874,000 FPL Group, Inc.** ......................... 34,610
616,000 Pinnacle West Capital Corporation ......... 24,702
-----------
Total Utilities ........................... 59,312
-----------
Total Common Stocks
(Cost $1,688,705) ...................... 2,276,671
-----------
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ---------- -----------
REPURCHASE AGREEMENT - 2.5%
(Cost $57,890)
$ 57,890 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006,
to be repurchased at $57,912,000 on
05/01/2006 (collateralized by U.S.
Treasury obligations, having various
interest rates and maturities.
market value $59,121,000) ................. $ 57,890
-----------
SHORT-TERM INVESTMENT - 6.4%
(Cost $150,151)
150,151 Mellon GSL DBT II Collateral Fund++ ....... 150,151
-----------
TOTAL INVESTMENTS (Cost $1,896,746*) ..................... 105.7% 2,484,712
OTHER ASSETS (LIABILITIES) (NET) ......................... (5.7) (133,357)
----- -----------
NET ASSETS ............................................... 100.0% $ 2,351,355
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006, and have an
aggregate market value of $146,454,000 representing 6.2% of the total net
assets of the Fund (collateral value $150,151,000). (See Note 7 to
Financial Statements.)
+ Non-income producing security.
++ Represents investment purchased with cash collateral for securities loaned.
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
28 See Notes to Financial Statements.
Portfolio of Investments
WEST COAST EQUITY FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 93.8%
CONSUMER DISCRETIONARY - 12.1%
AUTOMOBILES & COMPONENTS - 1.7%
799,000 Monaco Coach Corporation** ................ $ 11,122
174,700 Toyota Motor Corporation, Sponsored ADR ... 20,463
-----------
31,585
-----------
CONSUMER DURABLES & APPAREL - 1.8%
128,700 Columbia Sportswear Company+** ............ 6,549
112,700 KB Home** ................................. 6,939
266,400 Mattel, Inc. .............................. 4,310
208,000 NIKE Inc., Class B ........................ 17,023
-----------
34,821
-----------
CONSUMER SERVICES - 3.8%
131,315 Ambassadors Group, Inc. ................... 3,506
763,300 Hilton Hotels Corporation** ............... 20,563
1,253,785 Red Lion Hotels Corporation+*** ........... 15,046
892,700 Starbucks Corporation+** .................. 33,271
-----------
72,386
-----------
MEDIA - 4.2%
278,700 Getty Images, Inc.+** ..................... 17,839
124,300 Knight-Ridder, Inc.** ..................... 7,707
201,000 McClatchy Company, Class A** .............. 9,085
25,700 Pixar+ .................................... 1,652
753,700 Univision Communications Inc., Class
A+** ................................... 26,899
581,400 Walt Disney Company** ..................... 16,256
-----------
79,438
-----------
RETAILING - 0.6%
144,500 Blue Nile, Inc.+** ........................ 5,028
178,450 Building Materials Holding Corporation** .. 5,964
25,300 Nordstrom, Inc.** ......................... 970
-----------
11,962
-----------
Total Consumer Discretionary ............... 230,192
-----------
CONSUMER STAPLES - 5.5%
FOOD & STAPLES RETAILING - 1.9%
556,940 Costco Wholesale Corporation** ............ 30,314
339,600 Kroger Company ............................ 6,880
-----------
37,194
-----------
FOOD, BEVERAGE & TOBACCO - 0.8%
94,300 Archer Daniels Midland Company ............ 3,427
199,000 PepsiCo, Inc. ............................. 11,590
-----------
15,017
-----------
HOUSEHOLD & PERSONAL PRODUCTS - 2.8%
113,700 Central Garden & Pet Company+ ............. 5,601
288,030 Clorox Company ............................ 18,486
89,000 Colgate-Palmolive Company ................. 5,262
223,000 Estee Lauder Companies Inc., Class A** .... 8,278
260,000 Procter & Gamble Company .................. $ 15,134
-----------
52,761
-----------
Total Consumer Staples..................... 104,972
-----------
ENERGY - 7.5%
247,000 Apache Corporation** ...................... 17,547
131,000 Berry Petroleum Company, Class A .......... 9,654
78,000 CARBO Ceramics Inc. ....................... 4,518
669,826 Chevron Corporation ....................... 40,873
157,100 ExxonMobil Corporation .................... 9,910
907,200 Nabors Industries Ltd. (F)+ ............... 33,866
254,700 Occidental Petroleum Corporation** ........ 26,168
-----------
Total Energy .............................. 142,536
-----------
FINANCIALS - 16.8%
BANKS - 10.8%
529,800 Bank of America Corporation ............... 26,448
329,900 Banner Corporation ........................ 12,332
179,700 City National Corporation ................. 13,111
197,000 Countrywide Financial Corporation** ....... 8,010
489,000 East West Bancorp, Inc. ................... 19,399
323,000 Greater Bay Bancorp** ..................... 8,921
92,833 Pacific Capital Bancorp ................... 3,114
915,600 U.S. Bancorp .............................. 28,786
208,400 UCBH Holdings, Inc.** ..................... 3,686
40,000 UnionBanCal Corporation ................... 2,804
78,240 United PanAm Financial Corporation+ ....... 2,346
938,755 Washington Federal, Inc.** ................ 22,455
811,416 Wells Fargo & Company** ................... 55,736
-----------
207,148
-----------
DIVERSIFIED FINANCIALS - 4.4%
1,451,700 Charles Schwab Corporation ................ 25,985
467,300 Citigroup Inc. ............................ 23,342
332,500 Franklin Resources, Inc. .................. 30,962
46,432 Piper Jaffray Companies, Inc.+ ............ 3,246
-----------
83,535
-----------
INSURANCE - 1.6%
74,004 Safeco Corporation ........................ 3,841
529,730 StanCorp Financial Group, Inc. ............ 26,137
-----------
29,978
-----------
Total Financials .......................... 320,661
-----------
HEALTH CARE - 15.5%
HEALTH CARE EQUIPMENT & SERVICES - 7.5%
71,000 Affymetrix, Inc.+** ....................... 2,034
235,700 AMN Healthcare Services, Inc.+ ............ 4,530
237,800 Applera Corporation-Applied Biosystems
Group .................................. 6,858
27,000 C.R. Bard, Inc. ........................... 2,010
184,000 Caremark Rx, Inc.+ ........................ 8,381
12,300 Cooper Companies, Inc.** .................. 674
238,500 DaVita, Inc.+ ............................. 13,418
See Notes to Financial Statements. 29
Portfolio of Investments (continued)
WEST COAST EQUITY FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
HEALTH CARE (CONTINUED)
HEALTH CARE EQUIPMENT & SERVICES (CONTINUED)
84,460 Health Net, Inc.+ ......................... $ 3,438
152,700 McKesson Corporation ...................... 7,420
57,400 Mentor Corporation ........................ 2,487
935,400 OraSure Technologies, Inc.+** ............. 10,037
285,000 ResMed Inc.+ .............................. 12,298
675,363 SonoSite, Inc.+** ......................... 25,495
65,700 Stryker Corporation ....................... 2,874
92,300 Sybron Dental Specialties, Inc.+ .......... 4,342
404,000 Varian Medical Systems, Inc.+** ........... 21,162
318,000 VCA Antech, Inc.+** ....................... 9,887
93,600 Zimmer Holdings, Inc.+** .................. 5,887
-----------
143,232
-----------
PHARMACEUTICALS & BIOTECHNOLOGY - 8.0%
267,750 Abbott Laboratories ....................... 11,444
259,825 Allergan, Inc.** .......................... 26,689
366,839 Amgen, Inc.+** ............................ 24,835
109,300 Amylin Pharmaceuticals, Inc.+** ........... 4,760
266,137 CV Therapeutics, Inc.+** .................. 5,283
429,400 Dendreon Corporation+** ................... 1,748
144,225 Eden Bioscience Corporation+ .............. 340
244,000 Genentech, Inc.+ .......................... 19,449
27,300 Gilead Sciences, Inc.+ .................... 1,570
267,120 ICOS Corporation+** ....................... 5,858
284,700 Johnson & Johnson ......................... 16,686
112,300 Martek Biosciences Corporation+** ......... 3,335
104,000 Neurocrine Biosciences, Inc.+** ........... 5,966
577,700 Pfizer Inc. ............................... 14,633
387,300 Watson Pharmaceuticals, Inc.+** ........... 11,015
-----------
153,611
-----------
Total Health Care ......................... 296,843
-----------
INDUSTRIALS - 15.5%
CAPITAL GOODS - 11.1%
514,533 Boeing Company ............................ 42,938
183,000 Cascade Corporation ....................... 7,594
12,600 Ceradyne, Inc.+ ........................... 668
297,730 Dionex Corporation+ ....................... 17,899
341,530 Electro Scientific Industries, Inc.+ ...... 6,841
71,060 Granite Construction Inc. ................. 3,294
424,400 Greenbrier Companies, Inc. ................ 17,040
327,000 Jacobs Engineering Group Inc.+ ............ 27,043
309,000 Northrop Grumman Corporation** ............ 20,672
509,787 PACCAR Inc.** ............................. 36,669
230,000 Precision Castparts Corporation ........... 14,485
440,700 Simpson Manufacturing Company, Inc. ....... 17,624
-----------
212,767
-----------
COMMERCIAL SERVICES & SUPPLIES - 1.5%
48,000 Avery Dennison Corporation** .............. $ 3,000
249,000 Copart, Inc.+ ............................. 6,686
391,000 Robert Half International Inc.** .......... 16,528
47,700 Waste Connections, Inc.+ .................. 1,836
-----------
28,050
-----------
TRANSPORTATION - 2.9%
445,010 Alaska Air Group, Inc.+ ................... 16,893
546,900 Cathay Pacific Airways Ltd., Sponsored
ADR .................................... 4,884
389,720 Expeditors International of Washington,
Inc.** ................................. 33,364
-----------
55,141
-----------
Total Industrials ......................... 295,958
-----------
INFORMATION TECHNOLOGY - 16.7%
COMMUNICATIONS EQUIPMENT - 1.6%
1,085,600 Cisco Systems, Inc.+ ...................... 22,743
133,000 Polycom, Inc.+** .......................... 2,926
81,300 QUALCOMM Inc. ............................. 4,174
-----------
29,843
-----------
COMPUTERS & PERIPHERALS - 2.2%
1,123,700 Advanced Digital Information
Corporation+ ........................... 9,540
57,450 Apple Computer, Inc.+ ..................... 4,044
598,000 Hewlett-Packard Company ................... 19,417
136,000 InFocus Corporation+ ...................... 662
104,900 Intermec Inc.+ ............................ 2,779
27,000 Network Appliance, Inc.+** ................ 1,001
209,200 QLogic Corporation+ ....................... 4,354
-----------
41,797
-----------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.2%
494,000 Tektronix, Inc.** ......................... 17,448
113,530 Trimble Navigation Ltd.+** ................ 5,379
-----------
22,827
-----------
INTERNET SOFTWARE & SERVICES - 1.9%
2,510,261 Art Technology Group, Inc.+ ............... 7,129
26,650 Google Inc., Class A+ ..................... 11,138
564,700 WatchGuard Technologies, Inc.+ ............ 2,937
215,000 WebEx Communications, Inc.+ ............... 7,600
216,700 Yahoo! Inc.+** ............................ 7,104
-----------
35,908
-----------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 3.2%
323,700 Applied Materials, Inc. ................... 5,810
217,896 Credence Systems Corporation+ ............. 1,545
37,500 Exar Corporation+ ......................... 543
355,925 FEI Company+ .............................. 7,738
895,700 Intel Corporation** ....................... 17,896
66,000 International Rectifier Corporation+** .... 2,983
111,600 KLA-Tencor Corporation** .................. 5,375
30 See Notes to Financial Statements.
Portfolio of Investments (continued)
WEST COAST EQUITY FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
INFORMATION TECHNOLOGY (CONTINUED)
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT (CONTINUED)
701,080 Lattice Semiconductor Corporation+ ........ $ 4,662
464,400 LSI Logic Corporation+ .................... 4,946
54,000 Maxim Integrated Products, Inc.** ......... 1,904
136,400 Novellus Systems, Inc.+** ................. 3,369
60,600 NVIDIA Corporation+ ....................... 1,771
932,100 Pixelworks, Inc.+ ......................... 3,682
-----------
62,224
-----------
SOFTWARE - 6.6%
779,600 Actuate Corporation+ ...................... 3,282
652,000 Adobe Systems Inc.+ ....................... 25,558
141,000 Electronic Arts Inc.+** ................... 8,009
373,050 Fair Isaac Corporation .................... 13,844
94,000 Mentor Graphics Corporation+ .............. 1,234
1,869,378 Microsoft Corporation ..................... 45,146
575,100 Quest Software, Inc.+** ................... 9,898
408,508 RadiSys Corporation+ ...................... 8,644
243,200 SupportSoft, Inc.+ ........................ 1,111
248,600 Sybase, Inc.+ ............................. 5,412
195,178 Symantec Corporation+ ..................... 3,197
12,200 Websense, Inc.+ ........................... 303
-----------
125,638
-----------
Total Information Technology .............. 318,237
-----------
MATERIALS - 3.9%
52,300 Cemex SA de CV, Sponsored ADR ............. 3,531
402,330 Oregon Steel Mills, Inc.+** ............... 19,927
529,540 Schnitzer Steel Industries, Inc.,
Class A ................................ 20,827
134,461 Symyx Technologies, Inc.+ ................. 3,920
379,000 Weyerhaeuser Company ...................... 26,708
-----------
Total Materials ........................... 74,913
-----------
UTILITIES - 0.3%
111,000 Sempra Energy ............................. 5,108
-----------
Total Common Stocks
(Cost $1,202,629) ...................... 1,789,420
-----------
REAL ESTATE INVESTMENT TRUSTS (REITS) - 3.0%
358,700 AMB Property Corporation .................. 17,931
100,000 Essex Property Trust, Inc. ................ 10,910
322,485 Health Care Property Investors, Inc.** .... 8,843
46,400 Nationwide Health Properties, Inc.** ...... 999
530,000 Plum Creek Timber Company, Inc. ........... 19,239
-----------
Total REITs
(Cost $45,115) ......................... 57,922
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
REPURCHASE AGREEMENT - 3.1%
(Cost $59,149)
$ 59,149 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006 to
be repurchased at $59,172,000 on
05/01/2006 (collateralized by U.S.
Treasury obligations, having various
interest rates and maturities, market
value $60,407,000) ..................... $ 59,149
-----------
SHORT-TERM INVESTMENT - 10.3%
(Cost $195,406)
195,406 Mellon GSL DBT II
Collateral Fund++ ...................... 195,406
-----------
TOTAL INVESTMENTS (Cost $1,502,299*) ..................... 110.2% 2,101,897
OTHER ASSETS (LIABILITIES) (NET) ......................... (10.2) (194,732)
----- -----------
NET ASSETS ............................................... 100.0% $ 1,907,165
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006, and have an
aggregate market value of $189,267,000, representing 9.9% of the total net
assets of the Fund (collateral value $195,406,000). (See Note 7 to
Financial Statements.)
*** Affiliated issuer as defined by the Investment Company Act of 1940 (the
Fund controls 5.0% or more of the outstanding voting shares of the com-
pany). Total cost of such securities is $10,619,000 and the total value is
$15,046,000 or 0.8% of the total net assets of the Fund (See Note 12 to
Financial Statements).
+ Non-income producing security.
++ Represents investment purchased with cash collateral for securities loaned.
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
(F) -- Foreign Shares
See Notes to Financial Statements. 31
Portfolio of Investments
MID CAP STOCK FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 91.4%
CONSUMER DISCRETIONARY - 13.1%
AUTOMOBILES & COMPONENTS - 2.3%
284,300 Magna International Inc., Class A(F)** .... $ 22,303
-----------
CONSUMER DURABLES & APPAREL - 2.5%
256,500 Jones Apparel Group, Inc. ................. 8,811
952,400 Mattel, Inc. .............................. 15,410
-----------
24,221
-----------
CONSUMER SERVICES - 2.2%
179,500 Papa John's International, Inc.+ .......... 5,999
301,200 Yum! Brands, Inc. ......................... 15,566
-----------
21,565
-----------
RETAILING - 6.1%
377,500 Aaron Rents, Inc. ......................... 10,140
477,600 Nordstrom, Inc.** ......................... 18,306
486,700 Tiffany & Company ......................... 16,981
264,800 Weight Watchers International, Inc. ....... 13,068
-----------
58,495
-----------
Total Consumer Discretionary .............. 126,584
-----------
CONSUMER STAPLES - 1.4%
FOOD, BEVERAGE & TOBACCO - 0.8%
91,550 Dean Foods Company+ ....................... 3,626
100,800 J.M. Smucker Company ...................... 3,958
-----------
7,584
-----------
HOUSEHOLD & PERSONAL PRODUCTS - 0.6%
153,800 Estee Lauder Companies Inc., Class A** .... 5,709
-----------
Total Consumer Staples .................... 13,293
-----------
ENERGY - 8.0%
274,100 Cimarex Energy Company .................... 11,773
509,800 Nabors Industries Ltd. (F)+ ............... 19,031
406,500 Noble Energy, Inc. ........................ 18,284
130,200 Tesoro Corporation ........................ 9,104
326,000 Tidewater Inc.** .......................... 18,986
-----------
Total Energy .............................. 77,178
-----------
FINANCIALS - 19.1%
BANKS - 5.1%
304,511 North Fork Bancorporation, Inc. ........... 9,175
756,100 TCF Financial Corporation** ............... 20,309
809,050 Washington Federal, Inc. .................. 19,352
-----------
48,836
-----------
DIVERSIFIED FINANCIALS - 3.6%
357,000 A.G. Edwards, Inc.** ...................... 18,864
195,400 Ambac Financial Group, Inc. ............... 16,093
-----------
34,957
-----------
INSURANCE - 10.4%
918,800 Fidelity National Financial, Inc.** ....... $ 38,571
807,800 HCC Insurance Holdings, Inc.** ............ 27,053
369,700 Max Re Capital Ltd. (F) ................... 9,058
234,400 MGIC Investment Corporation** ............. 16,572
212,000 PMI Group, Inc.**. ........................ 9,784
-----------
101,038
-----------
Total Financials .......................... 184,831
-----------
HEALTH CARE - 11.2%
HEALTH CARE EQUIPMENT & SERVICES - 9.7%
159,100 AmerisourceBergen Corporation ............. 6,865
343,300 Covance Inc.+** ........................... 20,032
431,700 Edwards Lifesciences Corporation+** ....... 19,185
122,500 Express Scripts, Inc., Class A+ ........... 9,572
587,582 IMS Health Inc.** ......................... 15,970
427,800 Universal Health Services, Inc., Class
B** .................................... 21,728
-----------
93,352
-----------
PHARMACEUTICALS & BIOTECHNOLOGY - 1.5%
672,525 Mylan Laboratories Inc.** ................. 14,688
-----------
Total Health Care ......................... 108,040
-----------
INDUSTRIALS - 16.5%
CAPITAL GOODS - 6.4%
538,300 Federal Signal Corporation ................ 10,083
407,500 Lincoln Electric Holdings, Inc. ........... 22,335
232,300 PACCAR Inc.** ............................. 16,709
202,500 Teleflex Inc. ............................. 13,211
-----------
62,338
-----------
COMMERCIAL SERVICES & SUPPLIES - 5.0%
676,600 Allied Waste Industries, Inc.+** .......... 9,581
371,300 HNI Corporation ........................... 19,634
439,300 Republic Services, Inc. ................... 19,334
-----------
48,549
-----------
TRANSPORTATION - 5.1%
307,200 Alaska Air Group, Inc.+ ................... 11,661
881,000 AMR Corporation+** ........................ 21,708
611,100 Continental Airlines, Inc., Class B+** .... 15,913
-----------
49,282
-----------
Total Industrials ......................... 160,169
-----------
INFORMATION TECHNOLOGY - 12.2%
COMPUTERS & PERIPHERALS - 3.6%
579,000 Electronics for Imaging, Inc.+ ............ 15,899
510,900 Network Appliance, Inc.+** ................ 18,939
-----------
34,838
-----------
32 See Notes to Financial Statements.
Portfolio of Investments (continued)
MID CAP STOCK FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
INFORMATION TECHNOLOGY (CONTINUED)
ELECTRONIC EQUIPMENT & INSTRUMENTS - 2.5%
335,100 Arrow Electronics, Inc.+ .................. $ 12,131
284,900 Diebold, Inc. ............................. 12,122
-----------
24,253
-----------
IT SERVICES - 1.5%
451,900 Acxiom Corporation** ...................... 11,713
129,300 Convergys Corporation+ .................... 2,518
-----------
14,231
-----------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT - 2.8%
729,400 Microchip Technology Inc.** ............... 27,178
-----------
SOFTWARE - 1.8%
643,400 BMC Software Inc.+** ...................... 13,859
168,500 Synopsys, Inc.+ ........................... 3,678
-----------
17,537
-----------
Total Information Technology .............. 118,037
-----------
MATERIALS - 5.3%
255,500 Cabot Corporation**. ...................... 9,198
454,600 Lubrizol Corporation ...................... 19,825
775,400 Valspar Corporation. ...................... 21,944
-----------
Total Materials ........................... 50,967
-----------
TELECOMMUNICATION SERVICES - 0.6%
95,200 United States Cellular Corporation+ ....... 5,940
-----------
UTILITIES - 4.0%
897,400 NiSource Inc.** ........................... 18,944
494,300 Pinnacle West Capital Corporation** ....... 19,821
-----------
Total Utilities ........................... 38,765
-----------
Total Common Stocks
(Cost $626,109) ........................ 883,804
-----------
REAL ESTATE INVESTMENT TRUST (REIT) - 2.0%
(Cost $12,974)
413,300 General Growth Properties, Inc.** ......... 19,404
-----------
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
REPURCHASE AGREEMENT - 6.9%
(Cost $66,738)
$ 66,738 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006, to be
repurchased at $66,764,000 on 05/01/2006
(collateralized by U.S. Treasury
obligations, having various interest rates
and maturities, market value
$68,157,000) .............................. $ 66,738
-----------
SHORT-TERM INVESTMENT - 9.9%
(Cost $95,978)
95,978 Mellon GSL DBT II Collateral Fund++ ....... 95,978
-----------
TOTAL INVESTMENTS (Cost $801,799*) ....................... 110.2% 1,065,924
OTHER ASSETS (LIABILITIES) (NET) ......................... (10.2) (98,321)
----- -----------
NET ASSETS ............................................... 100.0% $ 967,603
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006, and have an
aggregate market value of $93,071,000 representing 9.6% of the total net
assets of the Fund (collateral value $95,978,000). (See Note 7 to Financial
Statements.)
+ Non-income producing security.
++ Represents investment purchased with cash collateral for securities loaned.
GLOSSARY OF TERMS
(F) -- Foreign Shares
See Notes to Financial Statements. 33
PORTFOLIO OF INVESTMENTS
GROWTH FUND
April 30, 2006 (Unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 97.8%
CONSUMER DISCRETIONARY - 15.8%
AUTOMOBILES & COMPONENTS - 0.1%
69,700 Toyota Motor Corporation (F) .............. $ 4,077
-----------
CONSUMER DURABLES & APPAREL - 1.1%
212,570 NIKE Inc., Class B ........................ 17,397
62,900 Polo Ralph Lauren Corporation ............. 3,819
144,300 Toll Brothers, Inc.+** .................... 4,639
-----------
25,855
-----------
CONSUMER SERVICES - 1.8%
177,280 Apollo Group, Inc., Class A+ .............. 9,687
105,100 Carnival Corporation ...................... 4,921
59,300 Las Vegas Sands Corporation+ .............. 3,843
666,010 Starbucks Corporation+** .................. 24,822
-----------
43,273
-----------
MEDIA - 2.8%
203,100 Comcast Corporation, Special Class A+** ... 6,261
1,310,500 Time Warner Inc. .......................... 22,803
646,200 Walt Disney Company 18,068
930,640 XM Satellite Radio Holdings Inc., Class
A+** ...................................... 18,817
-----------
65,949
-----------
RETAILING - 10.0%
1,048,400 Amazon.com Inc.+ .......................... 36,914
295,400 Bed Bath & Beyond Inc.+ ................... 11,329
125,150 Best Buy Company, Inc. .................... 7,091
1,079,960 eBay Inc.+ ................................ 37,161
48,100 Expedia, Inc.+** .......................... 897
1,203,645 Home Depot, Inc. .......................... 48,062
1,125,702 IAC/ InterActiveCorp+** ................... 32,499
104,900 J.C. Penney Company, Inc. (Holding
Company) .................................. 6,867
103,200 Kohl's Corporation+ ....................... 5,763
156,200 Lowe's Companies, Inc.** .................. 9,848
156,000 Michaels Stores, Inc. ..................... 5,902
950,590 Staples, Inc. ............................. 25,105
88,100 Target Corporation ........................ 4,678
232,900 Urban Outfitters, Inc.+ ................... 5,403
-----------
237,519
-----------
Total Consumer Discretionary ................. 376,673
-----------
CONSUMER STAPLES - 8.2%
FOOD & STAPLES RETAILING - 1.0%
11,100 Costco Wholesale Corporation .............. 604
267,500 CVS Corporation ........................... 7,950
530,455 Sysco Corporation ......................... 15,856
-----------
24,410
-----------
FOOD, BEVERAGE & TOBACCO - 4.3%
697,460 Cadbury Schweppes PLC (F) ................. $ 6,919
432,400 Coca-Cola Company ......................... 18,144
32,220 Nestle SA(F)** ............................ 9,827
845,285 PepsiCo, Inc. ............................. 49,229
325,200 Wm. Wrigley Jr. Company ................... 15,307
81,300 Wm. Wrigley Jr. Company, Class B .......... 3,829
-----------
103,255
-----------
HOUSEHOLD & PERSONAL PRODUCTS - 2.9%
1,042,707 Procter & Gamble Company .................. 60,696
216,640 Reckitt Benckiser PLC (F) ................. 7,897
-----------
68,593
-----------
Total Consumer Staples .................... 196,258
-----------
ENERGY - 5.8%
50,400 Apache Corporation ........................ 3,581
154,465 EOG Resources, Inc. ....................... 10,848
276,210 ExxonMobil Corporation .................... 17,423
249,120 Halliburton Company ....................... 19,469
96,816 Kinder Morgan Management LLC+ ............. 4,143
415,470 Occidental Petroleum Corporation .......... 42,685
160,100 Schlumberger Ltd. ......................... 11,069
217,900 Smith International, Inc. ................. 9,202
117,500 Transocean Inc.+** ........................ 9,526
151,285 Valero Energy Corporation ................. 9,794
-----------
Total Energy .............................. 137,740
-----------
FINANCIALS - 11.1%
BANKS - 0.1%
68,400 Bank of America Corporation ............... 3,415
-----------
DIVERSIFIED FINANCIALS - 8.1%
542,645 American Express Company .................. 29,200
18,100 Chicago Mercantile Exchange Holdings
Inc.** .................................... 8,290
84,800 Citigroup Inc. ............................ 4,236
430,615 Fannie Mae ................................ 21,789
48,300 Franklin Resources, Inc. .................. 4,498
66,200 Goldman Sachs Group, Inc. ................. 10,611
51,600 Legg Mason, Inc ........................... 6,113
20,800 Lehman Brothers Holdings Inc. ............. 3,144
678,335 Merrill Lynch & Company, Inc. ............. 51,730
367,000 Morgan Stanley ............................ 23,598
177,400 Nomura Holdings, Inc. (F) ................. 4,012
86,100 Northern Trust Corporation ................ 5,070
303,280 optionsXpress Holdings, Inc. .............. 9,553
25,700 T. Rowe Price Group, Inc. ................. 2,164
66,100 UBS AG (F) ................................ 7,724
-----------
191,732
-----------
34 See Notes to Financial Statements.
PORTFOLIO OF INVESTMENTS (CONTINUED)
GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
FINANCIALS (CONTINUED)
INSURANCE - 2.9%
502,640 American International Group, Inc. ........ $ 32,797
259 Berkshire Hathaway, Inc., Class A+ ........ 23,051
62,700 Hartford Financial Services Group, Inc. ... 5,764
101,000 Prudential Financial, Inc. ................ 7,891
-----------
69,503
-----------
Total Financials .......................... 264,650
-----------
HEALTH CARE - 18.9%
HEALTH CARE EQUIPMENT & SERVICES - 6.6%
93,275 Alcon, Inc. (F) ........................... 9,487
376,825 Boston Scientific Corporation+** .......... 8,757
332,930 Caremark Rx, Inc.+ ........................ 15,165
359,060 Conventry Health Care, Inc.+ .............. 17,835
47,700 Covance Inc.+ ............................. 2,783
93,300 Fisher Scientific International Inc.+** ... 6,582
647,275 Medtronic, Inc. ........................... 32,442
141,400 Quest Diagnostics Inc.** .................. 7,880
59,185 Roche Holding AG-Genusschein (F) .......... 9,101
153,700 St. Jude Medical, Inc.+ ................... 6,068
705,665 UnitedHealth Group Inc. ................... 35,100
89,900 Varian Medical Systems, Inc.+** ........... 4,709
-----------
155,909
-----------
PHARMACEUTICALS & BIOTECHNOLOGY - 12.3%
1,099,915 Amgen, Inc.+ .............................. 74,464
524,140 Biogen Idec Inc.+ ......................... 23,508
37,300 Celgene Corporation+ ...................... 1,573
20,200 Cephalon, Inc.+ ........................... 1,326
351,575 Eli Lilly & Company ....................... 18,605
726,200 Genentech, Inc.+ .......................... 57,885
111,700 Genzyme Corporation+ ...................... 6,832
52,200 Gilead Sciences, Inc.+ .................... 3,002
534,675 Johnson & Johnson ......................... 31,337
136,400 MedImmune, Inc.+ .......................... 4,293
216,613 Novartis AG (F) ........................... 12,427
122,800 PDL BioPharma Inc.+ ....................... 3,534
982,820 Pfizer Inc. ............................... 24,895
42,800 Sanofi-Aventis Group (F) .................. 4,036
344,685 Sanofi-Aventis, ADR** ..................... 16,214
237,862 Teva Pharmaceutical Industries Ltd.,
Sponsored ADR**......................... 9,633
-----------
293,564
-----------
Total Health Care ......................... 449,473
-----------
INDUSTRIALS - 5.3%
CAPITAL GOODS - 4.3%
105,600 Danaher Corporation** ..................... 6,770
190,600 Empresa Brasileira de Aeronautica SA,
ADR** .................................. 7,401
55,400 Fastenal Company** ........................ 2,593
103,300 General Dynamics Corporation .............. $ 6,779
1,830,263 General Electric Company .................. 63,309
104,100 Lockheed Martin Corporation ............... 7,901
126,000 United Technologies Corporation ........... 7,914
-----------
102,667
-----------
COMMERCIAL SERVICES & SUPPLIES - 0.4%
70,100 ChoicePoint Inc.+ ......................... 3,086
66,900 Corporate Executive Board Company ......... 7,167
-----------
10,253
-----------
TRANSPORTATION - 0.6%
35,700 Expeditors International of Washington,
Inc.** ................................. 3,056
94,690 FedEx Corporation ......................... 10,902
-----------
13,958
-----------
Total Industrials ......................... 126,878
-----------
INFORMATION TECHNOLOGY - 30.3%
COMMUNICATIONS EQUIPMENT - 9.4%
2,744,120 Cisco Systems, Inc.+ ...................... 57,489
246,400 Corning Inc.+ ............................. 6,808
44,600 F5 Networks, Inc.+ ........................ 2,612
938,600 Juniper Networks, Inc.+ ................... 17,345
2,220,450 Motorola, Inc. ............................ 47,407
227,000 Nokia Oyj, Sponsored ADR .................. 5,144
971,570 QUALCOMM Inc. ............................. 49,880
408,170 Research In Motion Ltd.+** ................ 31,278
154,600 Telefonaktiebolaget LM Ericsson, Sponsored
ADR** .................................. 5,484
-----------
223,447
-----------
COMPUTERS & PERIPHERALS - 1.8%
99,000 Apple Computer, Inc.+ ..................... 6,968
575,580 Dell Inc.+ ................................ 15,080
1,316,200 EMC Corporation+ .......................... 17,782
91,900 Network Appliance, Inc.+** ................ 3,407
-----------
43,237
-----------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 0.1%
123,300 PerkinElmer, Inc. ......................... 2,643
-----------
INTERNET SOFTWARE & SERVICES - 4.9%
585,400 Akamai Technologies, Inc.+ ................ 19,722
60,285 Google Inc., Class A+ ..................... 25,196
134,800 VeriSign Inc.+** .......................... 3,170
2,075,830 Yahoo! Inc.+** ............................ 68,046
-----------
116,134
-----------
IT SERVICES - 1.1%
131,100 Affiliated Computer Services, Inc.,
Class A+ ............................... 7,310
279,800 Automatic Data Processing, Inc. ........... 12,333
107,400 Cognizant Technology Solutions Corporation,
Class A+** ............................. 6,832
-----------
26,475
-----------
See Notes to Financial Statements. 35
PORTFOLIO OF INVESTMENTS (CONTINUED)
GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
INFORMATION TECHNOLOGY (CONTINUED)
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 6.6%
943,305 Advanced Micro Devices, Inc.+ ............. $ 30,516
245,850 Broadcom Corporation, Class A+ ............ 10,107
902,950 Intel Corporation ......................... 18,041
197,100 Linear Technology Corporation** ........... 6,997
70,200 Marvell Technology Group Ltd.+ ............ 4,008
152,200 Microchip Technology Inc.** ............... 5,671
61,310 Samsung Electronics Company Ltd., GDR ..... 20,931
1,706,900 Texas Instruments Inc.** .................. 59,246
-----------
155,517
-----------
SOFTWARE - 6.4%
482,655 Adobe Systems Inc.+ ....................... 18,920
169,400 Amdocs Ltd. (F)+ .......................... 6,302
105,400 Autodesk, Inc.+ ........................... 4,431
491,600 Electronic Arts Inc.+ ..................... 27,923
136,300 McAfee Inc.+ .............................. 3,556
2,195,022 Microsoft Corporation ..................... 53,010
57,200 NAVTEQ Corporation+ ....................... 2,375
655,200 Red Hat, Inc.+ ............................ 19,256
312,355 SAPAG, Sponsored ADR ...................... 17,064
-----------
152,837
-----------
Total Information Technology .............. 720,290
-----------
MATERIALS - 1.6%
169,900 Monsanto Company .......................... 14,170
202,000 Praxair, Inc. ............................. 11,338
54,795 Rio Tinto PLC, Sponsored ADR .............. 12,203
-----------
Total Materials ........................... 37,711
-----------
TELECOMMUNICATION SERVICES - 0.8%
205,500 American Tower Corporation, Class A+** .... 7,016
98,200 Crown Castle International Corporation+ ... 3,304
316,200 Sprint Nextel Corporation ................. 7,842
-----------
Total Telecommunication Services .......... 18,162
-----------
Total Common Stocks
(Cost $2,068,377) ...................... 2,327,835
-----------
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
COMMERCIAL PAPER - 0.7%
(Cost $17,500)
$ 17,500 Prudential Funding LLC,
4.750% due 05/01/2006++ ................... $ 17,500
-----------
U.S. GOVERNMENT AGENCY DISCOUNT NOTES - 0.6%
FEDERAL HOME LOAN BANK (FHLB) - 0.2%
5,000 4.600% due 06/12/2006++ ................... 4,973
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 0.4%
8,500 4.750% due 06/01/2006++ ................... 8,465
-----------
Total U.S. Government Agency Discount Notes
(Cost $13,438) ......................... 13,438
-----------
REPURCHASE AGREEMENT - 0.8%
(Cost $19,246)
19,246 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006, to be
repurchased at $19,253,000 on 05/01/2006
(collateralized by U.S. Treasury
obligations, having various interest rates
and maturities, market value
$19,655,000) .............................. 19,246
-----------
SHORT-TERM INVESTMENT - 5.5%
(Cost $129,442)
129,442 Mellon GSL DBT II Collateral Fund+++ ...... 129,442
-----------
TOTAL INVESTMENTS (Cost $2,248,003*) ..................... 105.4% 2,507,461
OTHER ASSETS (LIABILITIES) (NET) ......................... (5.4) (128,220)
----- -----------
NET ASSETS 100.0% $ 2,379,241
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006, and have an
aggregate market value of $124,430,000, representing 5.2% of the total net
assets of the Fund (collateral value (See Note 7 $129,442,000). to
Financial Statements.)
+ Non-income producing security.
++ Rate represents annualized yield at date of purchase.
+++ Represents investment purchased with cash collateral for securities loaned.
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
(F) -- Foreign Shares
GDR -- Global Depositary Receipt
36 See Notes to Financial Statements.
Portfolio of Investments
SMALL CAP VALUE FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 81.8%
CONSUMER DISCRETIONARY - 9.7%
AUTOMOBILES & COMPONENTS - 1.5%
393,000 Accuride Corporation+** ................... $ 4,028
31,700 Tenneco, Inc.+ ............................ 763
-----------
4,791
-----------
CONSUMER DURABLES & APPAREL - 3.3%
444,800 Lenox Group, Inc.+ ........................ 6,058
163,300 Rocky Shoes & Boots, Inc.+ ................ 4,030
-----------
10,088
-----------
MEDIA - 1.2%
70,500 Carmike Cinemas, Inc.** ................... 1,742
145,700 Reader's Digest Association, Inc. ......... 2,008
-----------
3,750
-----------
RETAILING - 3.7%
430,400 Blockbuster Inc., Class A** ............... 2,023
35,200 Children's Place Retail Stores, Inc.+ ..... 2,174
1,181,800 Movie Gallery, Inc. ....................... 3,073
108,000 RC2 Corporation+** ........................ 4,270
-----------
11,540
-----------
Total Consumer Discretionary .............. 30,169
-----------
CONSUMER STAPLES - 4.7%
FOOD & STAPLES RETAILING - 1.3%
216,100 Fresh Del Monte Produce, Inc.** ........... 4,065
-----------
FOOD, BEVERAGE & TOBACCO - 1.2%
241,000 B&G Foods Inc., EIS** ..................... 3,608
-----------
HOUSEHOLD & PERSONAL PRODUCTS - 2.2%
60,100 Central Garden & Pet Company+ ............. 2,960
115,500 Jarden Corporation+** ..................... 3,927
-----------
6,887
-----------
Total Consumer Staples .................... 14,560
-----------
ENERGY - 6.3%
141,100 Cimarex Energy Company .................... 6,060
137,400 Comstock Resources, Inc.+ ................. 4,271
103,400 Encore Acquisition Company+ ............... 3,168
33,500 Giant Industries, Inc.+ ................... 2,408
85,700 St. Mary Land & Exploration Company ....... 3,613
-----------
Total Energy .............................. 19,520
-----------
FINANCIALS - 14.2%
BANKS - 7.5%
121,500 Capital Corporation of the West ........... 4,147
36,800 Center Financial Corporation .............. 821
237,800 Dime Community Bancshares ................. 3,369
366,230 Oriental Financial Group, Inc. ............ 4,787
288,050 TrustCo Bank Corporation NY** ............. 3,333
142,947 U.S.B. Holding Company, Inc. .............. 3,182
157,100 Washington Federal, Inc.** ................ $ 3,758
-----------
23,397
-----------
INSURANCE - 6.7%
110,300 Navigators Group, Inc.+ ................... 5,218
96,700 Safety Insurance Group, Inc. .............. 4,476
107,700 State Auto Financial Corporation .......... 3,788
50,500 Stewart Information Services Corporation .. 2,182
170,900 United Fire & Casualty Company ............ 5,117
-----------
20,781
-----------
Total Financials .......................... 44,178
-----------
HEALTH CARE - 6.5%
HEALTH CARE EQUIPMENT & SERVICES - 3.7%
463,701 Gene Logic, Inc.+ ......................... 1,340
221,200 Kindred Healthcare, Inc.+** ............... 5,367
53,600 LifePoint Hospitals, Inc.+ ................ 1,699
90,100 Molina Healthcare Inc.+ ................... 2,946
-----------
11,352
-----------
PHARMACEUTICALS & BIOTECHNOLOGY - 2.8%
479,400 Bradley Pharmaceuticals, Inc.+** .......... 7,114
224,400 Lannett Company, Inc.+** .................. 1,645
-----------
8,759
-----------
Total Health Care ......................... 20,111
-----------
INDUSTRIALS - 14.2%
CAPITAL GOODS - 5.3%
93,600 DRS Technologies, Inc. .................... 5,198
147,000 Griffon Corporation+** .................... 3,920
989,300 New Flyer Industries Inc. (F), IDS++ ...... 7,521
-----------
16,639
-----------
COMMERCIAL SERVICES & SUPPLIES - 1.0%
116,900 McGrath RentCorp .......................... 3,143
-----------
TRANSPORTATION - 7.9%
112,700 Alaska Air Group, Inc.+ ................... 4,278
257,500 AMR Corporation+** ........................ 6,345
240,300 Continental Airlines, Inc., Class B+** .... 6,257
97,600 Dampskibsselskabet TORM A/S, ADR** ........ 4,476
160,900 OMI Corporation** ......................... 3,102
-----------
24,458
-----------
Total Industrials ......................... 44,240
-----------
INFORMATION TECHNOLOGY - 10.1%
COMMUNICATIONS EQUIPMENT - 1.2%
113,300 Bel Fuse Inc., Class B .................... 3,755
-----------
COMPUTERS & PERIPHERALS - 1.4%
184,100 Hutchinson Technology, Inc.+** ............ 4,376
-----------
ELECTRONIC EQUIPMENT & INSTRUMENTS - 1.4%
295,300 LeCroy Corporation+ ....................... 4,238
-----------
See Notes to Financial Statements. 37
Portfolio of Investments (continued)
SMALL CAP VALUE FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
INFORMATION TECHNOLOGY (CONTINUED)
IT SERVICES - 1.3%
515,000 Lionbridge Technologies, Inc.+ ............ $ 4,233
-----------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT - 3.3%
676,800 Axcelis Technologies, Inc.+ ............... 3,986
551,100 Credence Systems Corporation+ ............. 3,907
215,600 PortalPlayer Inc.+** ...................... 2,383
-----------
10,276
-----------
SOFTWARE - 1.5%
456,800 RealNetworks, Inc.+** ..................... 4,577
-----------
Total Information Technology .............. 31,455
-----------
MATERIALS - 11.4%
103,100 Century Aluminum Company+ ................. 4,909
84,300 Headwaters, Inc.+** ....................... 2,839
1,656,100 Kingsgate Consolidated Ltd. (F) ........... 7,348
175,100 Metal Management, Inc. .................... 5,682
4,149,700 Minara Resources Ltd. (F) ................. 7,724
279,900 Randgold Resources Ltd., ADR+ ............. 6,813
-----------
Total Materials ........................... 35,315
-----------
TELECOMMUNICATION SERVICES - 3.9%
265,800 Asia Satellite Telecommunications
Holdings Ltd., Sponsored ADR ........... 4,521
139,500 Iowa Telecommunications Services Inc.** ... 2,517
216,900 USA Mobility, Inc. ........................ 4,965
-----------
Total Telecommunication Services .......... 12,003
-----------
UTILITIES - 0.8%
81,700 Suburban Propane Partners LP** ............ 2,381
-----------
Total Common Stocks
(Cost $227,009) ........................ 253,932
-----------
CANADIAN INCOME TRUSTS - 7.0%
CONSUMER STAPLES - 2.9%
FOOD, BEVERAGE & TOBACCO - 2.9%
390,300 Arctic Glacier Income Fund (F) ............ 3,788
566,400 Connors Brothers Income Fund (F) .......... 5,091
-----------
Total Consumer Staples .................... 8,879
-----------
ENERGY - 4.1%
150,400 Harvest Energy Trust (F)** ................ 4,626
206,300 Vermilion Energy Trust (F)** .............. 6,095
67,200 Zargon Energy Trust (F) ................... 2,019
-----------
Total Energy .............................. 12,740
-----------
Total Canadian Income Trusts
(Cost $17,255) ......................... 21,619
-----------
REAL ESTATE INVESTMENT TRUSTS (REITS) - 5.3%
106,000 Entertainment Properties Trust ............ 4,332
208,100 Equity Inns, Inc.** ....................... 3,371
91,900 Redwood Trust, Inc. ....................... $ 3,903
40,900 Sovran Self Storage, Inc. ................. 2,010
269,800 Winston Hotels, Inc.** .................... 2,906
-----------
Total REITs
(Cost $14,012) ......................... 16,522
-----------
CONTRACTS
- ---------
PURCHASED PUT OPTIONS - 0.7%
10,730 iShares Russell 2000 Index,
Expires January 2007 @ $56 ............. 483
29,250 iShares Russell 2000 Index,
Expires January 2007 @ $49 ............. 439
10,300 iShares Russell 2000 Index,
Expires January 2008 @ $55 ............. 1,236
20,000 NASDAQ-100 Index,
Expires January 2007 @ $30 ............. 200
-----------
Total Purchased Put Options
(Cost $10,830) ......................... 2,358
-----------
PRINCIPAL
AMOUNT
(000S)
- ---------
REPURCHASE AGREEMENT - 4.0%
(Cost $12,352)
$ 12,352 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006,
to be repurchased at $12,357,000 on
05/01/2006 (collateralized by U.S.
Treasury obligations, having various
interest rates and maturities,
market value $12,615,000) ................. 12,352
-----------
SHORT-TERM INVESTMENT - 16.1%
(Cost $49,923)
49,923 Mellon GSL DBT II
Collateral Fund+++ ..................... 49,923
-----------
TOTAL INVESTMENTS (Cost $331,381*) ....................... 114.9% 356,706
OTHER ASSETS (LIABILITIES) (NET) ......................... (14.9) (46,372)
----- -----------
NET ASSETS ............................................... 100.0% $ 310,334
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006, and have an
aggregate market value of $47,422,000, representing 15.3% of the total net
assets of the Fund (collateral value $49,923,000). (See Note 7 to Financial
Statements.)
+ Non-income producing security.
++ Security acquired in a transaction exempt from registration under Rule 144A
of the Securities Act of 1933, as amended.
+++ Represents investment purchased with cash collateral for securities loaned.
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
EIS -- Enhanced Income Security
(F) -- Foreign Shares
IDS -- Income Deposit Security
38 See Notes to Financial Statements.
Portfolio of Investments
SMALL CAP GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 94.0%
CONSUMER DISCRETIONARY - 14.9%
CONSUMER DURABLES & APPAREL - 5.2%
63,080 Carter's, Inc.+ ........................... $ 4,249
127,360 Charles & Colvard Ltd.** .................. 1,504
166,648 Coach, Inc.+ .............................. 5,503
61,800 Crocs, Inc.+** ............................ 1,848
60,569 Desarrolladora Homex SAde CV, ADR+** ...... 2,321
63,000 Directed Electronics, Inc.+ ............... 1,030
83,700 Under Armour, Inc., Class A+** ............ 3,079
70,600 Volcom, Inc.+ ............................. 2,518
-----------
22,052
-----------
CONSUMER SERVICES - 2.5%
74,300 BJ's Restaurants Inc.+ .................... 1,956
50,424 Ctrip.com International Ltd., ADR ......... 2,269
71,000 Ruby Tuesday, Inc.** ...................... 2,113
37,100 Shuffle Master, Inc.+** ................... 1,371
85,246 Sonic Corporation+ ........................ 2,891
-----------
10,600
-----------
MEDIA - 2.0%
140,500 Focus Media Holding Ltd., ADR+ ............ 8,485
-----------
RETAILING - 5.2%
53,239 Guitar Center, Inc.+** .................... 2,862
103,700 Gymboree Corporation+ ..................... 3,119
176,959 Hibbett Sporting Goods, Inc.+ ............. 5,364
114,900 Hot Topic, Inc.+** ........................ 1,704
10,100 Iconix Brand Group, Inc.+ ................. 174
113,300 Priceline.com Inc.+ ....................... 2,769
61,881 Stamps.com, Inc.+ ......................... 1,745
500 Steven Madden, Ltd.+ ...................... 27
36,489 Tractor Supply Company+ ................... 2,364
91,864 Urban Outfitters, Inc.+** ................. 2,131
-----------
22,259
-----------
Total Consumer Discretionary .............. 63,396
-----------
CONSUMER STAPLES - 1.2%
FOOD & STAPLES RETAILING - 0.7%
77,900 Central European Distribution
Corporation+ .............................. 3,198
-----------
HOUSEHOLD & PERSONAL PRODUCTS - 0.5%
59,247 Parlux Fragrances, Inc.+** ................ 1,616
11,762 USANA Health Sciences, Inc.+** ............ 430
-----------
2,046
-----------
Total Consumer Staples .................... 5,244
-----------
ENERGY - 9.7%
71,024 ATP Oil & Gas Corporation+ ................ 3,234
106,700 Basic Energy Services, Inc.+** ............ 3,556
119,100 Bronco Drilling Company, Inc.+ ............ 3,217
37,300 CARBO Ceramics Inc. ....................... 2,161
184,661 Carrizo Oil & Gas, Inc.+ .................. 5,425
49,700 Dril-Quip, Inc.+ .......................... $ 3,577
66,100 Hercules Offshore, Inc.+ .................. 2,703
255,800 Input/Output, Inc.+** ..................... 2,579
39,600 Lufkin Industries, Inc. ................... 2,537
201,200 Petrohawk Energy Corporation+** ........... 2,531
120,400 Pioneer Drilling Company+ ................. 1,952
30,400 SEACOR Holdings Inc.+ ..................... 2,689
54,537 Veritas DGC, Inc.+ ........................ 2,613
54,000 W-H Energy Services, Inc.+ ................ 2,714
-----------
Total Energy .............................. 41,488
-----------
FINANCIALS - 4.7%
BANKS - 1.6%
88,000 Brookline Bancorp, Inc. ................... 1,302
95,800 Midwest Banc Holdings, Inc. ............... 2,247
84,700 Signature Bank+ ........................... 2,996
11,100 Sterling Financial Corporation ............ 357
-----------
6,902
-----------
DIVERSIFIED FINANCIALS - 1.3%
156,468 First Cash Financial Services, Inc.+ ...... 3,312
131,900 TradeStation Group, Inc.+ ................. 2,103
-----------
5,415
-----------
INSURANCE - 1.8%
151,100 American Equity Investment Life
Holding Company** ......................... 2,049
136,900 Amerisafe Inc.+ ........................... 1,602
77,006 Delphi Financial Group, Inc., Class A ..... 4,034
-----------
7,685
-----------
Total Financials .......................... 20,002
-----------
HEALTH CARE - 23.6%
HEALTH CARE EQUIPMENT & SERVICES - 12.2%
58,500 Abaxis, Inc.+** ........................... 1,528
127,191 Adeza Biomedical Corporation+ ............. 2,179
51,014 Advisory Board Company+ ................... 2,863
206,400 Align Technology, Inc.+ ................... 1,814
76,116 ArthroCare Corporation+** ................. 3,450
60,180 Aspect Medical Systems, Inc.+ ............. 1,713
72,129 Centene Corporation+ ...................... 1,853
137,732 Conceptus, Inc.+** ........................ 1,892
60,600 Conor Medsystems, Inc.+ ................... 1,636
33,000 Foxhollow Technologies Inc.+** ............ 1,028
91,900 HealthExtras, Inc.+ ....................... 2,671
93,800 Healthspring, Inc.+ ....................... 1,595
40,422 Healthways, Inc.+ ......................... 1,983
78,900 Immucor, Inc.+ ............................ 2,292
109,807 IntraLase Corporation+** .................. 2,359
47,900 IRIS International Inc.+** ................ 567
85,952 Kyphon, Inc.+ ............................. 3,571
74,384 LCA-Vision, Inc.** ........................ 4,177
75,052 Merge Technologies, Inc.+** ............... 949
130,900 Micrus Endovascular Corporation+ .......... 1,844
See Notes to Financial Statements. 39
Portfolio of Investments (continued)
SMALL CAP GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
HEALTH CARE (CONTINUED)
HEALTH CARE EQUIPMENT & SERVICES (CONTINUED)
53,900 Natus Medical Inc.+ ....................... $ 1,078
45,400 Palomar Medical Technologies, Inc.+** ..... 1,915
71,700 Quidel Corporation+ ....................... 821
98,100 Syneron Medical Ltd. (F)+** ............... 2,538
85,917 Ventiv Health, Inc.+ ...................... 2,581
1,900 Visicu, Inc.+** ........................... 45
34,300 Vital Images, Inc.+ ....................... 1,147
-----------
52,089
-----------
PHARMACEUTICALS & BIOTECHNOLOGY - 11.4%
84,700 Adams Respiratory Therapeutics, Inc.+ ..... 3,633
160,800 Anadys Pharmaceuticals Inc.+ .............. 2,230
169,300 Aspreva Pharmaceuticals Corporation (F)+ .. 5,756
60,300 Combinatorx Inc.+** ....................... 539
142,900 CV Therapeutics, Inc.+** .................. 2,837
61,738 Digene Corporation+ ....................... 2,550
71,400 Encysive Pharmaceuticals, Inc.+** ......... 305
96,335 First Horizon Pharmaceutical Corporation+ . 2,145
135,200 Keryx Biopharmaceuticals, Inc.+ ........... 2,303
66,329 Kos Pharmaceuticals, Inc.+ ................ 3,210
165,844 MGI Pharma, Inc.+** ....................... 3,098
221,100 Nastech Pharmaceutical Company Inc.+** .... 3,354
142,734 Nektar Therapeutics+** .................... 3,070
99,257 PDL BioPharma Inc.+** ..................... 2,857
145,847 Rigel Pharmaceuticals, Inc.+ .............. 1,565
129,916 Salix Pharmaceuticals Ltd.+** ............. 1,780
123,400 Telik, Inc.+** ............................ 2,269
84,539 United Therapeutics Corporation+ .......... 5,034
-----------
48,535
-----------
Total Health Care ......................... 100,624
-----------
INDUSTRIALS - 12.5%
CAPITAL GOODS - 8.2%
153,120 A.S.V., Inc.+** ........................... 3,828
21,964 American Science & Engineering, Inc.+** ... 1,883
49,500 Bucyrus International, Inc.** ............. 2,570
149,380 Ceradyne, Inc.+** ......................... 7,917
55,700 ESCO Technologies Inc.+** ................. 2,824
113,300 Essex Corporation+ ........................ 2,417
115,600 Hexcel Corporation+** ..................... 2,554
28,400 iRobot Corporation+** ..................... 619
13,100 Ladish Co., Inc.+ ......................... 467
70,575 Lincoln Electric Holdings, Inc ............ 3,868
63,000 NCI Building Systems, Inc.+ ............... 4,094
157,421 TurboChef Technologies, Inc.+** ........... 2,015
-----------
35,056
-----------
COMMERCIAL SERVICES & SUPPLIES - 3.4%
9,200 American Ecology Corporation .............. 246
41,358 CRA International Inc.+ ................... 2,017
70,700 Kenexa Corporation+ ....................... $ 2,349
112,516 LECG Corporation+ ......................... 2,081
58,900 Mine Safety Appliances Company ............ 2,462
58,900 Portfolio Recovery Associates, Inc.+** .... 3,030
82,000 Resources Connection, Inc.+** ............. 2,206
-----------
14,391
-----------
TRANSPORTATION - 0.9%
102,574 Knight Transportation, Inc. ............... 2,003
58,000 Universal Truckload Services, Inc.+ ....... 1,759
-----------
3,762
-----------
Total Industrials ......................... 53,209
-----------
INFORMATION TECHNOLOGY - 27.4%
COMMUNICATIONS EQUIPMENT - 5.6%
163,699 AudioCodes Ltd.(F)+ ....................... 2,229
65,400 F5 Networks, Inc.+** ...................... 3,830
378,873 Glenayre Technologies, Inc.+ .............. 2,095
164,400 Ixia+ ..................................... 1,858
146,462 Openwave Systems Inc.+** .................. 2,726
1,400 OPLINK Communinications Inc.+ ............. 27
41,406 Orckit Communications Ltd.(F)+** .......... 667
148,900 Polycom, Inc.+ ............................ 3,276
61,700 Redback Networks Inc.+** .................. 1,382
58,500 Sierra Wireless+ .......................... 1,053
250,000 Symmetricom, Inc.+** ...................... 2,025
144,300 Tekelec+** ................................ 2,061
240,900 Zhone Technologies, Inc.+** ............... 583
-----------
23,812
-----------
COMPUTERS & PERIPHERALS - 1.4%
23,300 Hutchinson Technology, Inc.+** ............ 554
78,300 Neoware Inc.+ ............................. 1,697
69,900 Rackable Systems Inc.+ .................... 3,592
-----------
5,843
-----------
INTERNET SOFTWARE & SERVICES - 4.7%
95,200 Akamai Technologies, Inc.+** .............. 3,207
183,543 aQuantive, Inc.+** ........................ 4,600
123,800 iVillage, Inc.+** ......................... 1,047
135,923 Jupitermedia Corporation+ ................. 2,395
86,691 Marchex, Inc., Class B+** ................. 1,886
168,700 Secure Computing Corporation+ ............. 1,814
156,172 ValueClick, Inc.+** ....................... 2,631
133,800 WebSideStory, Inc.+** ..................... 2,299
-----------
19,879
-----------
IT SERVICES - 2.6%
167,124 Euronet Worldwide, Inc.+** ................ 5,973
79,424 RightNow Technologies, Inc.+** ............ 1,470
117,000 VeriFone Holdings, Inc.+** ................ 3,623
-----------
11,066
-----------
40 See Notes to Financial Statements.
Portfolio of Investments (continued)
SMALL CAP GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
INFORMATION TECHNOLOGY (CONTINUED)
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 7.8%
33,900 ATMI, Inc.+** ............................. $ 963
48,155 Cymer, Inc.+ .............................. 2,489
70,800 Ikanos Communications, Inc.+ .............. 1,311
100,500 Microsemi Corporation+** .................. 2,746
202,752 O2Micro International Limited (F)+ ........ 2,178
17,400 Saifun Semiconductors Ltd. (F)+ ........... 595
119,100 Semtech Corporation+** .................... 2,233
128,500 Silicon Motion Technology Corporation,
ADR+ ................................... 1,912
68,300 SiRF Technology Holdings, Inc.+** 2,333
31,000 Supertex, Inc.+** 1,197
122,484 Tessera Technologies, Inc.+ 3,928
274,200 Trident Microsystems, Inc.+** 7,294
37,500 Varian Semiconductor Equipment Associates,
Inc.+** ................................ 1,228
105,700 Zoran Corporation+** 2,900
-----------
33,307
-----------
SOFTWARE - 5.3%
143,700 Concur Technologies, Inc.+ ................ 2,240
53,300 FactSet Research Systems Inc.** ........... 2,353
180,800 FalconStor Software, Inc.+** .............. 1,358
215,400 Informatica Corporation+** ................ 3,311
18,000 MRO Software, Inc.+ ....................... 342
162,136 Online Resources Corporation+ ............. 2,103
20,700 Open Solutions Inc.+ ...................... 563
117,293 PDF Solutions, Inc.+ ...................... 1,830
38,000 Retalix Ltd. (F)+** ....................... 934
67,780 TALX Corporation .......................... 1,763
263,000 TIBCO Software Inc.+ ...................... 2,267
212,100 VASCO Data Security International,
Inc.+** ................................ 1,985
68,700 Witness Systems, Inc.+ .................... 1,604
-----------
22,653
-----------
Total Information Technology .............. 116,560
-----------
Total Common Stocks
(Cost $316,488) ........................ 400,523
-----------
REAL ESTATE INVESTMENT TRUSTS (REITS) - 1.0%
58,140 RAIT Investment Trust ..................... 1,505
124,700 Strategic Hotels & Resorts, Inc. .......... 2,828
-----------
Total REITs
(Cost $3,861) .......................... 4,333
-----------
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- --------- -----------
REPURCHASE AGREEMENT - 4.4%
(Cost $18,839)
$ 18,839 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006, to
be repurchased at $18,846,000 on
05/01/2006 (collateralized by U.S.
Treasury obiligations, having various
interest rates and maturiies, market
value $19,240,000) ..................... $ 18,839
-----------
SHORT-TERM INVESTMENT - 19.2%
(Cost $82,004)
82,004 Mellon GSL DBT II Collateral Fund++ ....... 82,004
-----------
TOTAL INVESTMENTS (Cost $421,192*) ....................... 118.6% 505,699
OTHER ASSETS (LIABILITIES) (NET) ......................... (18.6) (79,286)
----- -----------
NET ASSETS ............................................... 100.0% $ 426,413
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April
30, 2006, and have an aggregate market value of
$77,921,000, representing 18.3% of the total net assets
of the Fund (collateral value $82,004,000). (See Note 7
to Financial Statments.)
+ Non-income producing security.
++ Represents investment purchased with cash collateral
for securities loaned.
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
(F) -- Foreign Shares
See Notes to Financial Statements. 41
Portfolio of Investments
INTERNATIONAL GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS - 96.4%
JAPAN - 24.3% ***
41,410 Advantest Corporation ..................... $ 4,771
246,000 AEON Company Ltd. ......................... 6,125
61,900 Astellas Pharma Inc. ...................... 2,582
30,100 Canon Inc. ................................ 2,302
95,300 Daiichi Sankyo Company Ltd.+ .............. 2,456
106,000 Daimaru, Inc. ............................. 1,543
87,000 Daiwa House Industry Company Ltd. ......... 1,483
79,400 FANUC Ltd. ................................ 7,510
17,900 Hirose Electric Company Ltd. .............. 2,627
70,800 Hoya Corporation .......................... 2,866
190,700 Kansai Electric Power Company Inc. ........ 4,463
119,000 Kao Corporation ........................... 3,198
289 Millea Holdings, Inc. ..................... 5,761
222,000 Mitsubishi Corporation .................... 5,371
454,000 Mitsubishi Estate Company Ltd. ............ 9,928
405,000 Mitsubishi Heavy Industries Ltd. .......... 2,006
1,221 Mitsubishi UFJ Financial Group, Inc. ...... 19,195
167,000 Mitsui & Company Ltd. ..................... 2,524
89,000 Mitsui Fudosan Company Ltd. ............... 1,993
156,000 Mitsui Sumitomo Insurance Company Ltd. .... 2,103
1,260 Mizuho Financial Group, Inc. .............. 10,745
23,000 Murata Manufacturing Company Ltd. ......... 1,675
118,000 NGK Spark Plug Company, Ltd.** ............ 2,591
32,000 Nidec Corporation ......................... 2,467
46,400 Nintendo Company Ltd. ..................... 6,928
205,000 Nippon Electric Glass Company, Ltd. ....... 4,627
525,000 Nippon Steel Corporation .................. 1,937
432 Nippon Telegraph & Telephone Corporation .. 1,935
634,900 Nissan Motor Company Ltd. ................. 8,347
119,300 Nitto Denko Corporation ................... 10,006
203,000 Obayashi Corporation ...................... 1,553
318,000 Odakyu Electric Railway Company, Ltd. ..... 2,000
45,630 ORIX Corporation .......................... 13,705
180,000 Ricoh Company, Ltd. ....................... 3,573
43,200 Rohm Company Ltd. ......................... 4,598
39,000 SECOM Company Ltd. ........................ 2,127
12,100 Shimamura Company Ltd. .................... 1,492
66,200 Shin-Etsu Chemical Company Ltd. ........... 3,826
49,500 SMC Corporation ........................... 7,521
561,000 SOFTBANK Corporation** .................... 14,436
241,000 Sompo Japan Insurance Inc. ................ 3,492
37,190 Sony Corporation .......................... 1,868
573,000 Sumitomo Corporation ...................... 8,585
2,389 Sumitomo Mitsui Financial Group, Inc. ..... 26,226
84,000 Sumitomo Realty & Development Company,
Ltd. ................................... 2,228
377,000 Suzuki Motor Corporation .................. 9,204
24,950 T&D Holdings, Inc. ........................ 1,913
76,200 Takeda Pharmaceutical Company Ltd. ........ 4,658
19,100 TDK Corporation ........................... 1,599
69,600 Tokyo Electric Power Company Inc. ......... 1,788
138,100 Tokyo Electron Ltd. ....................... 9,945
407,000 Tokyo Gas Company Ltd.** .................. 1,970
565,000 Tokyu Corporation ......................... 3,985
250,000 Toshiba Corporation** ..................... 1,592
25,700 Toyota Motor Corporation (F) .............. $ 1,503
112,000 Trend Micro Inc. .......................... 4,338
83,700 USHIO Inc. ................................ 1,930
7,830 Yahoo! Japan Corporation .................. 4,566
42,300 Yamada Denki Company Ltd. ................. 4,610
297,500 Yamato Holdings Company, Ltd. ............. 5,931
-----------
298,827
-----------
UNITED KINGDOM - 13.2%
9,600 Anglo American PLC ........................ 414
50,900 Anglo American PLC (F) .................... 2,167
437,000 ARM Holdings PLC .......................... 1,084
156,400 AstraZeneca PLC ........................... 8,642
97,000 AstraZeneca PLC (F) ....................... 5,365
460,800 Astro All Asia Networks PLC ............... 582
731,700 BAE Systems PLC ........................... 5,571
110,084 BHP Billiton PLC .......................... 2,266
137,300 Brambles Industries PLC ................... 1,135
101,100 British Land Company PLC .................. 2,316
174,563 Cadbury Schweppes PLC (F) ................. 1,732
59,500 Carnival PLC .............................. 2,949
633,900 HBOS PLC .................................. 11,126
197,900 HSBC Holdings PLC ......................... 3,419
105,600 Johnston Press PLC ........................ 936
10,800 Kazakhmys PLC ............................. 224
470,000 Kingfisher PLC ............................ 1,931
278,400 Lloyds TSB Group PLC ...................... 2,708
10,800 Lonmin PLC ................................ 538
92,000 Northern Rock PLC ......................... 1,778
112,900 Oxus Gold PLC+ ............................ 169
163,400 Pearson PLC ............................... 2,265
761,600 Reed Elsevier PLC ......................... 7,569
44,000 Rio Tinto PLC ............................. 2,420
643,500 Royal Bank of Scotland Group PLC++ ........ 21,017
466,948 Royal Dutch Shell PLC, A Shares ........... 16,012
121,402 Royal Dutch Shell PLC, B Shares ........... 4,341
180,400 Scottish & Southern Energy PLC ............ 3,701
224,800 Smith & Nephew PLC ........................ 1,859
224,000 Standard Chartered PLC .................... 5,947
233,900 Tesco PLC ................................. 1,363
194,000 TI Automotive Ltd., Class A+# ............. 0
464,700 Unilever PLC .............................. 4,936
11,575,019 Vodafone Group PLC (F) .................... 27,334
71,600 Wolseley PLC .............................. 1,793
63,800 Xstrata PLC ............................... 2,308
244,800 Yell Group PLC ............................ 2,294
-----------
162,211
-----------
FRANCE - 7.9%
38,895 Accor SA** ................................ 2,448
61,500 AXA Group** ............................... 2,257
12,760 BNP Paribas+** ............................ 1,165
127,600 BNP Paribas SA** .......................... 12,057
211,865 Bouygues SA++** ........................... 11,560
24,800 Dassault Systemes SA** .................... 1,345
21,200 Essilor International SA** ................ 2,126
24,300 Groupe Danone** ........................... 3,032
42 See Notes to Financial Statements.
Portfolio of Investments (continued)
INTERNATIONAL GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
FRANCE (CONTINUED)
13,406 L'Air Liquide SA .......................... $ 2,901
57,600 L'Oreal SA** .............................. 5,341
52,000 Lafarge SA** .............................. 6,396
23,700 Renault SA** .............................. 2,751
56,700 Safran SA ................................. 1,456
189,500 Sanofi-Aventis Group (F)** ................ 17,871
82,587 Schneider Electric SA** ................... 9,351
17,900 Societe Generale Group** .................. 2,735
41,600 Thales SA ................................. 1,788
18,360 Total SA** ................................ 5,077
53,600 Veolia Environment SA** ................... 3,203
62,300 Vivendi SA** .............................. 2,275
-----------
97,135
-----------
SWITZERLAND - 6.3%
31,000 Adecco SA** ............................... 1,922
236,782 Compagnie Financiere Richemont AG,
A Units ................................ 12,267
85,139 Credit Suisse Group ....................... 5,348
115,263 Holcim Ltd.** ............................. 9,666
31,081 Nestle SA (F)** ........................... 9,479
296,387 Novartis AG (F) ........................... 17,004
33,331 Roche Holding AG-Genusschein (F) .......... 5,125
121,291 Swiss Reinsurance Company** ............... 8,851
11,589 Swisscom AG ............................... 3,866
10,500 Synthes, Inc. ............................. 1,304
15,785 UBS AG** .................................. 1,871
-----------
76,703
-----------
CANADA - 4.9%
153,900 Abitibi-Consolidated Inc.** ............... 664
245,800 Alcan Inc.** .............................. 12,835
4,300 Banro Corporation+ ........................ 52
5,400 Banro Corportation+,++ .................... 65
3,700 Barrick Gold Corporation .................. 113
217,900 Barrick Gold Corporation (F) .............. 6,642
212,800 Cameco Corporation ........................ 8,658
27,500 Canadian Imperial Bank of Commerce ........ 2,035
135,700 Canadian Natural Resources Ltd. ........... 8,156
33,000 CIC Energy Corporation+ ................... 196
67,700 Inco Ltd. (F) ............................. 3,823
83,600 Ivanhoe Mines Ltd.+ ....................... 815
14,200 Magna International Inc., Class A** ....... 1,113
25,800 Manulife Financial Corporation** .......... 1,685
81,100 Methanex Corporation ...................... 1,795
54,300 Potash Corporation of Saskatchewan Inc. ... 5,140
44,800 Suncor Energy Inc. ........................ 3,836
51,000 TELUS Corporation** ....................... 2,108
-----------
59,731
-----------
GERMANY - 4.8%
35,200 Allianz AG ................................ 5,893
37,000 Altana AG ................................. 2,375
82,300 Bayer AG .................................. 3,801
28,500 Bayerische Motoren Werke (BMW) AG ......... 1,550
67,000 Commerzbank AG ............................ $ 2,777
84,500 DaimlerChrysler AG** ...................... 4,633
32,200 Deutsche Bank AG .......................... 3,953
16,137 Deutsche Boerse AG ........................ 2,334
97,600 Deutsche Post AG .......................... 2,602
50,100 E.ON AG** ................................. 6,101
41,700 Infineon Technologies AG+ ................. 510
32,600 SAPAG** ................................... 7,123
85,900 Siemens AG ................................ 8,128
99,300 Volkswagen AG** ........................... 7,668
-----------
59,448
-----------
NETHERLANDS - 4.5%
255,535 ABN AMRO Holding NV ....................... 7,637
261,444 AEGON NV .................................. 4,773
85,625 Heineken Holding NV** ..................... 3,054
130,406 Heineken NV** ............................. 5,283
285,614 ING Groep NV** ............................ 11,624
1,215,600 Koninklijke (Royal) KPN NV** .............. 14,278
50,700 Koninklijke (Royal) Numico NV+ ............ 2,298
12,700 Pyaterochka Holding NV, GDR+ .............. 243
79,400 Reed Elsevier NV** ........................ 1,177
75,500 TNT NV** .................................. 2,718
25,200 Unilever NV ............................... 1,820
-----------
54,905
-----------
SOUTH KOREA - 3.9% ***
124,570 Asiana Airlines+ .......................... 1,024
590 Cheil Communications Inc. ................. 125
760 CJ Home Shopping .......................... 87
7,650 Daewoo Shipbuilding & Marine Engineering
Company Ltd. ........................... 223
2,600 Doosan Heavy Industries and Construction
Company Ltd. ........................... 94
54,940 Doosan Infracore Company Ltd. ............. 1,028
16,950 GS Engineering & Construction Corporation . 1,229
59,980 Hankook Tire Company Ltd. ................. 903
12,430 Hynix Semiconductor Inc.+ ................. 434
16,120 Hyundai Development Company ............... 935
2,010 Hyundai Heavy Industries Company Ltd. ..... 193
2,210 Hyundai Mipo Dockyard Company Ltd. ........ 207
2,140 Hyundai Mobis ............................. 189
19,330 Hyundai Motor Company ..................... 1,699
14,040 Hyundai Steel Company ..................... 543
42,330 Kookmin Bank .............................. 3,792
11,550 Kookmin Bank, Sponsored ADR ............... 1,029
14,200 KT Corporation, Sponsored ADR ............. 330
3,130 KT&G Corporation .......................... 175
1,800 LG.Philips LCD Company Ltd.+ .............. 76
75,500 LG.Philips LCD Company Ltd., ADR+ ......... 1,589
1,520 Lotte Shopping Company Ltd. ............... 635
23,090 LS Cable Ltd. ............................. 955
38,800 Macquarie Korea Infrastructure Fund+ ...... 286
33,300 Macquarie Korea Infrastructure Fund, GDR+ . 241
880 Nong Shim Company Ltd. .................... 246
580 POSCO ..................................... 162
2,300 POSCO, ADR ................................ 162
See Notes to Financial Statements. 43
Portfolio of Investments (continued)
INTERNATIONAL GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
SOUTH KOREA (CONTINUED)
13,750 Pusan Bank ................................ $ 211
33,957 Samsung Electronics Company Ltd. .......... 23,185
25,300 Samsung Engineering Company Ltd. .......... 1,082
14,040 Samsung Fire & Marine Insurance Company
Ltd. ................................... 2,017
3,630 Samsung Securities Company Ltd. ........... 228
25,530 Shinhan Financial Group Company Ltd. ...... 1,272
760 Shinsegae Company Ltd. .................... 372
1,130 SK Corporation ............................ 83
9,700 SK Telecom Company Ltd., ADR .............. 259
9,300 Sungshin Cement Company Ltd. .............. 170
20,090 Woori Finance Holdings Company Ltd. ....... 454
-----------
47,924
-----------
SPAIN - 3.1%
62,400 Altadis, SA** ............................. 2,962
506,900 Banco Bilbao Vizcaya Argentaria SA ........ 11,198
573,000 Banco Santander Central Hispano SA** ...... 8,884
85,000 Iberdrola SA .............................. 2,769
61,300 Industria de Diseno Textil SA(Inditex)** .. 2,494
235,100 Repsol YPF SA** ........................... 7,023
165,274 Telefonica SA ............................. 2,648
-----------
37,978
-----------
SOUTH AFRICA - 2.8%
68,100 ABSA Group Ltd. ........................... 1,344
8,200 Anglo Platinum Ltd. ....................... 792
6,800 AngloGold Ashanti Ltd. .................... 369
20,700 AngloGold Ashanti Ltd., Sponsored ADR ..... 1,132
39,000 Aspen Pharmacare Holdings Ltd. ............ 276
173,300 Aveng Ltd. ................................ 685
19,100 Barloworld Ltd. ........................... 419
74,200 Edgars Consolidated Stores Ltd. ........... 469
60,900 Gold Fields Ltd. .......................... 1,532
134,000 Harmony Gold Mining Company Ltd.+ ......... 2,206
7,400 Impala Platinum Holdings Ltd. ............. 1,403
73,400 Massmart Holdings Ltd. .................... 718
9,100 Mittal Steel South Africa Ltd. ............ 106
42,500 Mr. Price Group Ltd. ...................... 155
224,153 Murray & Roberts Holdings Ltd. ............ 1,014
120,258 Mvelaphanda Resources Ltd.+ ............... 700
1,800 Naspers Ltd., N Shares .................... 40
128,651 Network Healthcare Holdings Ltd. .......... 218
16,400 Sappi Ltd. ................................ 235
428,700 Sasol Ltd. ................................ 18,039
106,700 Standard Bank Group Ltd. .................. 1,523
20,800 Truworths International Ltd. .............. 100
26,088 Wilson Bayly Holmes-Ovcon Ltd. ............ 260
-----------
33,735
-----------
MEXICO - 2.2%
484,400 America Movil SA de CV, Series L, ADR ..... 17,879
634,100 Carso Infraestructura y Construccion SA+ .. 464
34,700 Cemex SA de CV, CPO ....................... 235
294,500 Empresas ICA SA de CV+ 918
36,700 Grupo Aeroportuario del Pacifico SA de
CV, ADR+ ............................... $ 1,221
11,932 Grupo Cementos de Chihuahua SA de CV, O
Shares ................................. 39
141,529 Grupo Financiero Banorte SA de CV ......... 369
64,600 Grupo Financiero Inbursa SA de CV ......... 102
82,100 Grupo Televisa SA, Sponsored ADR .......... 1,741
101,900 Impulsora del Desarrollo y el Empleo en
America Latina, SA de CV+ .............. 101
100,600 Kimberly-Clark de Mexico, SA de CV, Class A 355
1,233,400 Wal-Mart de Mexico SA de CV, Series V ..... 3,516
-----------
26,940
-----------
TAIWAN - 2.1% ***
112,400 AU Optronics Corporation, ADR ............. 1,847
56,493 Cathy Financial Holding Company, Ltd.,
GDR .................................... 1,266
25,900 Chi Mei Optoelectronics Corporation, GDR .. 368
84,000 China Steel Corporation, GDR .............. 1,697
26,000 China Steel Corporation, Sponsored GDR .... 508
354,000 Fubon Financial Holding Company, Ltd.,
GDR .................................... 3,428
536,000 Hon Hai Precision Industry Company, Ltd.,
GDR .................................... 7,274
60,000 Quanta Computer Inc., GDR ................. 529
47,100 Siliconware Precision Industries Company,
ADR .................................... 330
808,296 Taiwan Semiconductor Manufacturing Company
Ltd., Sponsored ADR .................... 8,471
75,100 United Microelectronics Corporation, ADR .. 283
-----------
26,001
-----------
AUSTRALIA - 1.9% ***
326,300 Amcor Ltd. ................................ 1,792
202,878 Brambles Industries Ltd.** ................ 1,720
374,145 Foster's Group Ltd. ....................... 1,671
677,209 Insurance Australia Group Ltd.** .......... 2,907
38,042 Macquarie Bank Limited .................... 2,064
169,100 Promina Group Ltd. ........................ 729
125,943 QBE Insurance Group Ltd. .................. 2,141
329,460 Rinker Group Ltd. ......................... 5,307
81,200 Westpac Banking Corporation ............... 1,549
269,055 Woolworths Ltd. ........................... 3,814
-----------
23,694
-----------
HONG KONG - 1.8% ***
307,200 Bank of East Asia, Ltd. ................... 1,284
950,000 BOC Hong Kong (Holdings) Ltd. ............. 1,961
318,000 Clear Media Ltd.+ ......................... 394
762,000 Foxconn International Holdings Ltd.+ ...... 1,641
86,000 Guangdong Investment Ltd. ................. 36
836,000 Hang Lung Group Ltd. ...................... 1,989
850,000 Hang Lung Properties Ltd. ................. 1,710
911,500 Johnson Electric Holdings Ltd. ............ 770
17,500 Kingboard Chemical Holdings Ltd. .......... 46
1,394,000 Li & Fung Ltd. ............................ 3,308
2,408,000 PCCW Ltd. ................................. 1,600
622,000 Shangri-La Asia Ltd. ...................... 1,103
181,000 Sung Hung Kai Properties Ltd. ............. 2,068
421,500 Swire Pacific Ltd., Class A ............... 4,311
-----------
22,221
-----------
44 See Notes to Financial Statements.
Portfolio of Investments (continued)
INTERNATIONAL GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
BRAZIL - 1.2%
12,000 All America Latina Logistica .............. $ 762
29,000 Banco Nossa Caixa SA ...................... 655
87,000 Companhia de Bebidas das Americas, ADR .... 3,563
23,000 Companhia de Concessoes Rodoviarias ....... 201
40,000 Companhia de Saneamento de Minas Gerais -
Copasa MG+ ............................. 403
10,000 Companhia Siderurgica Nacional SA,
Sponsored ADR .......................... 352
16,000 Companhia Vale do Rio Doce,
Sponsored ADR .......................... 712
4,500 Gerdau SA, Sponsored ADR (F) .............. 78
11,769,000 Light SA+ ................................. 90
21,000 Lojas Renner SA ........................... 1,202
44,000 Natura Cosmeticos SA ...................... 560
20,000 Porto Seguro SA ........................... 406
12,000 Submarino SA .............................. 322
16,500 Telemig Celular Participacoes SA, ADR ..... 719
130,189,000 Tim Participacoes SA ...................... 580
49,200 Tim Participacoes SA, ADR ................. 1,892
27,000 Unibanco - Uniao de Bancos Brasileiros SA,
GDR .................................... 2,142
5,000 Usinas Siderurgicas de Minas Gerais SA .... 216
28,386 Vivo Participacoes SA, ADR+ ............... 117
-----------
14,972
-----------
FINLAND - 1.1%
286,800 Nokia Oyj ................................. 6,531
123,300 Nokia Oyj, Sponsored ADR .................. 2,794
176,200 UPM-Kymmene Oyj ........................... 4,135
-----------
13,460
-----------
INDIA - 1.1%
130,500 ICICI Bank Ltd., Sponsored ADR ............ 3,580
64,100 Infosys Technologies Ltd., Sponsored ADR .. 5,041
43,600 McDowell & Company Ltd., GDR+ ............. 379
68,624 Ranbaxy Laboratories Ltd., Sponsored GDR .. 721
40,300 Reliance Energy Ltd., GDR ................. 1,640
30,430 Reliance Industries Ltd., Sponsored GDR ... 1,367
27,900 Wipro Ltd., ADR ........................... 399
-----------
13,127
-----------
CHINA - 1.1% ***
122,000 Advanced Semiconductor Manufacturing
Corporation, Class H+,++ ............... 30
220,000 Agile Property Holdings Ltd.+ ............. 170
96,000 Angang New Steel Company Ltd., Class H .... 84
624,000 Anhui Conch Cement Company Ltd., Class H .. 1,078
512,000 Beijing Capital International Airport
Company Ltd., Class H .................. 297
84,000 Beijing Enterprises Holdings Ltd. ......... 184
555,000 Bio-Treat Technology Ltd. ................. 463
486,700 BOE Technology Group Company Ltd.,
Class B ................................ 80
2,069,000 China Construction Bank, Class H+ ......... 894
3,600 China Life Insurance Company Ltd., ADR+ ... 194
764,000 China Life Insurance Company Ltd.,
Class H+ ............................... 1,030
698,000 China Mengniu Dairy Company Ltd. .......... $ 797
49,000 China Merchants Holdings International
Company Ltd. ........................... 167
122,500 China Netcom Group Corporation Ltd. ....... 224
310,000 China Oilfield Services Ltd., Class H ..... 171
248,000 China Overseas Land & Investment Ltd. ..... 158
616,000 China Paradise Electronics Retail Ltd.+ ... 218
106,000 China Resources Enterprise Ltd. ........... 227
272,140 Chongqing Changan Automobile Company Ltd.,
Class B ................................ 153
4,800 Ctrip.com International Ltd., ADR ......... 216
84,000 Dalian Port (PDA) Company Ltd., Class H+ .. 47
52,000 Dalian Port (PDA) Company Ltd.,
Class H+,++ ............................ 29
1,150,000 Dongfeng Motor Corporation Ltd.,
Class H+ ............................... 575
330,000 GOME Electrical Appliances Holdings Ltd. .. 285
606,000 Lenovo Group Ltd. ......................... 227
86,000 Li Ning Company Ltd. ...................... 97
187,000 Lianhua Supermarket Holdings Ltd.,
Class H ................................ 218
29,600 NetEase.com Inc., ADR+ .................... 642
384,000 Nine Dragons Paper Holdings Ltd.+ ......... 334
1,174,000 PetroChina Company Ltd., Class H .......... 1,295
2,525,000 Semiconductor Manufacturing International
Corporation+ ........................... 384
11,600 Shanda Interactive Entertainment Ltd.,
ADR+ ................................... 143
490,000 Shanghai Forte Land Company Ltd., Class
H ...................................... 239
100,000 Shanghai Prime Machinery Company Ltd.,
Class H+ ............................... 37
66,000 Shanghai Prime Machinery Company Ltd.,
Class H+,++ ............................ 25
416,000 Tsingtao Brewery Company Ltd., Class H .... 480
105,000 Weichai Power Company Ltd., Class H ....... 248
60,500 Weiqiao Textile Company Ltd., Class H ..... 80
158,000 Wumart Stores, Inc., Class H .............. 520
93,000 ZTE Corporation, Class H .................. 318
-----------
13,058
-----------
SWEDEN - 1.1%
92,100 Assa Abloy AB, B Shares** ................. 1,783
128,100 Atlas Copco AB, Class A** ................. 3,786
35,400 Sandvik AB ................................ 2,304
3,700 Scania AB, B Shares** ..................... 172
1,402,000 Telefonaktiebolaget LM Ericsson, B
Shares** ............................... 4,992
-----------
13,037
-----------
RUSSIA - 0.9%
9,300 Evraz Group SA, GDR, S Shares ............. 232
25,900 Evraz Group SA, GDR, S Shares (F) ......... 648
61,000 Gazprom, Sponsored ADR (F) ................ 2,770
4,300 LUKOIL, Sponsored ADR ..................... 389
12,200 Mining and Metallurgical Company Norilsk
Nickel, ADR ............................ 1,549
9,800 Mobile TeleSystems, Sponsored ADR ......... 320
3,700 NovaTek OAO, Sponsored GDR Regulation S ... 135
48,600 Novolipetsk Steel, GDR+ ................... 1,081
11,300 Pyaterochka Holding NV, GDR+ .............. 215
41,900 Unified Energy System of Russia, GDR ...... 3,214
12,100 Vimpel-Communications, Sponsored ADR+ ..... 563
-----------
11,116
-----------
See Notes to Financial Statements. 45
Portfolio of Investments (continued)
INTERNATIONAL GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
ISRAEL - 0.7%
56,300 Bank Hapoalim BM .......................... $ 284
22,671 Mizrahi Tefahot Bank Ltd.+ ................ 152
48,000 Partner Communications Company Ltd. ....... 407
149,200 Supersol Ltd. ............................. 447
182,900 Teva Pharmaceutical Industries Ltd.,
Sponsored ADR .......................... 7,407
-----------
8,697
-----------
SINGAPORE - 0.7% ***
149,000 DBS Group Holdings Ltd.** ................. 1,678
3,252,675 Singapore Telecommunications Ltd.++ ....... 5,627
122,000 United Overseas Bank Ltd.** ............... 1,258
-----------
8,563
-----------
INDONESIA - 0.7% ***
615,500 PT Bank Central Asia Tbk .................. 306
6,236,500 PT Bank Mandiri ........................... 1,363
1,430,000 PT Bank Rakyat Indonesia .................. 753
503,500 PT Ciputra Surya Tbk ...................... 45
41,000 PT Jaya Real Property Tbk ................. 16
660,500 PT Medco Energi Internasional Tbk ......... 361
786,500 PT Ramayana Lestari Sentosa Tbk ........... 81
74,000 PT Summarecon Agung Tbk ................... 10
6,343,500 PT Telekomunikasi Indonesia ............... 5,452
-----------
8,387
-----------
IRELAND - 0.5%
93,268 CRH PLC ................................... 3,430
171,200 Depfa Bank PLC ............................ 3,214
-----------
6,644
-----------
TURKEY - 0.5%
211,074 Akbank T.A.S .............................. 1,756
33,523 Anadolu Efes Biracilik ve Malt Sanayii
AS ..................................... 1,122
91,214 Dogan Yayin Holding AS+ ................... 462
81,975 Hurriyet Gazetecilik ve Matbaacilik AS .... 301
62,857 Koc Holding AS ............................ 344
39,544 Selcuk Ecza Deposu Ticaret ve Sanayi AS+ .. 200
154,632 Turkiye Garanti Bankasi AS ................ 637
144,895 Turkiye Is Bankasi, Class C ............... 1,216
-----------
6,038
-----------
MALAYSIA - 0.5% ***
726,900 Airasia BHD+ .............................. 351
548,100 Bumiputra-Commerce Holdings BHD ........... 953
145,000 EON Capital BHD ........................... 252
17,100 Genting BHD ............................... 120
481,700 IJM Corporation BHD ....................... 777
169,700 IOI Corporation BHD ....................... 665
61,900 Malakoff BHD .............................. 167
30,800 Malayan Banking BHD ....................... 94
54,500 Maxis Communications BHD .................. 131
98,800 MISC BHD (F) .............................. 240
301,100 MK Land Holdings BHD ...................... 68
105,000 Resorts World BHD ......................... $ 388
109,600 Road Builder (M) Holdings BHD ............. 68
469,200 SP Setia BHD ............................... 484
98,900 Tenaga Nasional BHD ....................... 233
142,700 Transmile Group BHD ....................... 520
195,100 UMW Holdings BHD .......................... 396
-----------
5,907
-----------
BELGIUM - 0.4%
31,200 Fortis .................................... 1,171
63,600 SES GLOBAL, FDR ........................... 1,023
51,400 UCB Group SA .............................. 2,647
-----------
4,841
-----------
THAILAND - 0.4% ***
476,300 Bank of Ayudhya PCL, NVDR ................. 237
55,500 Banpu Public Comany Ltd., NVDR ............ 225
254,200 Electricity Generating PCL, NVDR .......... 566
472,100 Kasikornbank PCL, (F) ..................... 855
95,300 Kiatnakin Bank PCL, NVDR .................. 89
2,281,500 Krung Thai Bank PCL, (F) .................. 748
125,800 Ratchaburi Electricity Generating Holding
PCL, (F) ............................... 130
29,300 Siam Cement PCL, NVDR ..................... 186
56,600 Siam City Cement PCL, (F) ................. 407
148,700 Thai Airways International PCL, (F) ....... 196
232,000 Thanachart Capital PCL, NVDR .............. 99
144,900 TISCO Bank PCL, (F) ....................... 111
554,600 TISCO Bank PCL, NVDR ...................... 421
-----------
4,270
-----------
EGYPT - 0.3%
62,800 Commercial International Bank, GDR ........ 770
12,000 Mobinil (Egyptian Mobile Phone Network) ... 329
36,900 Orascom Construction Industries, GDR ...... 3,077
-----------
4,176
-----------
ITALY - 0.3%
322,200 Banca Intesa SpA** ........................ 1,910
70,550 Eni SpA ................................... 2,154
-----------
4,064
-----------
AUSTRIA - 0.3%
23,600 Erste Bank der Oesterreichischen Sparkassen
AG** ................................... 1,432
11,900 Raiffeisen International Bank Holding
AG+** .................................. 1,037
58,808 Telekom Austria AG ........................ 1,443
-----------
3,912
-----------
DENMARK - 0.3%
51,800 Novo Nordisk A/S, Class B ................. 3,364
-----------
NORWAY - 0.2%
127,700 DnB NOR ASA** .............................. 1,771
76,713 Norske Skogindustrier ASA** ................ 1,182
-----------
2,953
-----------
46 See Notes to Financial Statements.
Portfolio of Investments (continued)
INTERNATIONAL GROWTH FUND
April 30, 2006 (unaudited)
VALUE
SHARES (000S)
- ------ -----------
COMMON STOCKS (CONTINUED)
GREECE - 0.2%
52,000 Opap SA ................................... $ 1,922
-----------
UNITED STATES - 0.1%
1,400 Freeport-McMoRan Copper & Gold, Inc.,
Class B ................................ 90
8,400 Net 1 UEPS Technologies, Inc.+ ............ 264
60,197 News Corporation (F), CDI ................. 1,036
11,400 Zoran Corporation+ ........................ 313
-----------
1,703
-----------
LUXEMBOURG - 0.1%
20,000 Ternium SA, Sponsored ADR+ ................ 534
-----------
UNITED ARAB EMIRATES - 0.0%
37,400 Kingdom Hotels Investments, GDR+ .......... 328
-----------
OMAN - 0.0%
26,950 Bank Muscat SAOG, GDR ..................... 268
-----------
PHILIPPINES - 0.0% ***
8,800 Ayala Corporation ......................... 61
42,700 SM Investments Corporation ................ 190
-----------
251
-----------
CHILE - 0.0%
19,000 Enersis SA, Sponsored ADR ................. 232
-----------
HUNGARY - 0.0%
15,500 Magyar Telekom Telecommunications ......... 71
-----------
Total Common Stocks
(Cost $861,049) ........................ 1,183,348
-----------
PREFERRED STOCKS - 0.4%
BRAZIL - 0.4%
4,300 Banco Itau Holding Financeira SA .......... 138
9,000 Bradespar SA++ ............................ 356
4,000 Companhia de Bebidas das Americas, ADR .... 185
4,674,000 Companhia Energetica de Minas Gerais ...... 223
4,410 Duratex S.A.++ ............................ 95
14,000 Duratex S.A ............................... 300
437,000 Itausa - Investimentos Itau SA ............ 2,006
1,286,000 Lojas Americanas SA ....................... 53
9,300 Suzano Petroquimica SA .................... 17
22,000 Usinas Siderurgicas de Minas Gerais SA,
Class A ................................ 835
18,276 Vivo Participacoes SA+ .................... 74
-----------
4,282
-----------
CHILE - 0.0%
35,200 Embotelladora Andina SA, Class A, ADR ..... 482
-----------
SOUTH KOREA - 0.0% ***
900 Samsung Electronics Company Ltd. .......... 488
Total Preferred Stocks (Cost $4,618) ...... 5,252
-----------
RIGHTS - 0.0%
(Cost $0)
SWITZERLAND - 0.0%
121,291 Swiss Reinsurance Company+ ................ $ 0
-----------
PRINCIPAL
AMOUNT
(000S)
- ------------
FOREIGN BONDS AND NOTES - 0.1%
$ 37 Dominican Republic, 9.500% due
09/27/2011++ ........................... 40
165 Federal Republic of Brazil, Note,
8.000% due 01/15/2018 .................. 179
400 Mexican Fixed Rate Bonds,
8.000% due 12/07/2023 .................. 34
1,236 Republic of Argentina, Note,
5.830% due 12/31/2033 .................. 525
30 Republic of Peru,
9.875% due 02/06/2015 .................. 36
40 Republic of Venezuela, Bond,
9.250% due 09/15/2027 .................. 50
50 Russian Federation, Bond,
5.000% due 03/31/2030 .................. 54
60 Turkey Government Bond,
20.000% due 10/17/2007 ................. 50
-----------
Total Foreign Bonds and Notes
(Cost $959) ............................ 968
-----------
REPURCHASE AGREEMENT - 3.1%
(Cost $37,868)
37,868 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006, to
be repurchased at $37,883,000 on
05/01/2006 (collateralized by U.S.
Treasury obligations, having various
interest rates and maturities, market
value $38,673,000) ..................... 37,868
-----------
SHORT-TERM INVESTMENT - 15.6%
(Cost $191,138)
191,138 Mellon GSL DBT II Collateral Fund+++ ...... 191,138
-----------
TOTAL INVESTMENTS (Cost $1,095,632*) ..................... 115.6% 1,418,574
OTHER ASSETS (LIABILITIES) (NET) ......................... (15.6) (191,027)
----- -----------
NET ASSETS ............................................... 100.0% $ 1,227,547
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Some or all of these securities are on loan at April 30, 2006, and have an
aggregate market value of $184,042,000, representing 15.0% of the total net
assets of the Fund (collateral value $191,138,000). (See Note 7 to
Financial Statements.)
*** Investments in areas of the Pacific Rim at April 30, 2006 are 37.4% of the
total net assets of the Fund.
+ Non-income producing security.
++ Security acquired in a transaction exempt from registration under Rule
144A of the Securities Act of 1933, as amended.
+++ Represents investment purchased with cash collateral for securities loaned.
# Security is restricted and illiquid. It was acquired on October 30, 2001,
and has a value of $0.00 per Fund share at April 30, 2006.
See Notes to Financial Statements. 47
Portfolio of Investments (continued)
INTERNATIONAL GROWTH FUND
April 30, 2006 (unaudited)
SCHEDULE OF FORWARD FOREIGN CURRENCY CONTRACTS
FORWARD FOREIGN CURRENCY CONTRACTS TO BUY
CONTRACTS TO RECEIVE NET
(000S) UNREALIZED
----------------------------------------- APPRECIATION/
EXPIRATION LOCAL VALUE IN IN EXCHANGE (DEPRECIATION)
DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACTS
- ---------- ------------ -------- ----------- --------------
5/2/06 AUD 136 104 103 $ 1
5/2/06 CAD 20 18 18 --
5/2/06 EUR 548 691 682 9
5/2/06 GBP 115 211 206 5
5/2/06 HKD 140 18 18 --
5/2/06 JPY 16,974 149 149 --
5/2/06 ZAR 409 68 68 --
5/3/06 EUR 176 223 222 1
5/3/06 GBP 20 37 37 --
5/3/06 HKD 1,163 150 150 --
5/4/06 EUR 447 564 564 --
5/4/06 GBP 130 237 237 --
5/4/06 ZAR 527 88 87 1
5/8/06 ZAR 1,272 212 212 --
6/14/06 GBP 2,109 3,848 3,660 188
6/26/06 GBP 2,112 3,855 3,602 253
7/21/06 AUD 4,852 3,681 3,584 97
----
$555
====
FORWARD FOREIGN CURRENCY CONTRACTS TO SELL
CONTRACTS TO DELIVER NET
(000S) UNREALIZED
------------------------------------------ APPRECIATION/
EXPIRATION LOCAL VALUE IN IN EXCHANGE (DEPRECIATION)
DATE CURRENCY U.S. $ FOR U.S. $ OF CONTRACTS
- ---------- ------------ -------- ----------- --------------
5/1/06 JPY 9,788 86 85 $ (1)
5/2/06 CHF 84 67 66 (1)
5/2/06 EUR 27 34 34 --
5/2/06 HKD 36 5 5 --
5/3/06 EUR 155 195 194 (1)
5/3/06 ZAR 77 13 13 --
5/5/06 ZAR 222 37 36 (1)
5/8/06 JPY 22,495 198 198 --
6/14/06 CHF 4,723 3,828 3,660 (168)
6/26/06 CHF 4,757 3,859 3,602 (257)
7/7/06 ZAR 3,006 498 495 (3)
7/19/06 ZAR 2,759 457 446 (11)
7/21/06 EUR 2,910 3,691 3,584 (107)
-----
$(550)
-----
Net Unrealized Appreciation of Forward Foreign Currency
Contracts $ 5
=====
AT APRIL 30, 2006, SECTOR DIVERSIFICATION WAS AS FOLLOWS:
% OF VALUE
SECTOR DIVERSIFICATION NET ASSETS (000S)
- ---------------------- ---------- ----------
COMMON STOCKS:
Banks ....................................... 17.5% $ 214,622
Materials ................................... 10.4 127,654
Telecommunication Services .................. 8.2 100,072
Pharmaceuticals & Biotechnology ............. 6.9 84,294
Capital Goods ............................... 6.3 77,470
Energy ...................................... 5.7 69,918
Semiconductors & Semiconductor Equipment .... 4.4 54,025
Insurance ................................... 3.8 46,152
Food, Beverage & Tobacco .................... 3.6 43,694
Automobiles & Components .................... 3.5 43,523
Diversified Financials ...................... 2.8 33,908
Utilities ................................... 2.5 30,670
Electronic Equipment & Instruments .......... 2.3 28,285
Retailing ................................... 2.2 27,333
Internet Software & Services ................ 2.0 24,663
Consumer Durables & Apparel ................. 2.0 24,388
Real Estate Investment Trusts (REITs) ....... 1.9 23,422
Media ....................................... 1.8 22,220
Transportation .............................. 1.7 21,030
Commercial Services & Supplies .............. 1.6 20,165
Communications Equipment .................... 1.3 16,276
Other ....................................... 4.0 49,564
----- ----------
TOTAL COMMON STOCKS ......................... 96.4 1,183,348
PREFERRED STOCK ............................. 0.4 5,252
RIGHTS ...................................... 0.0 0
FOREIGN BONDS AND NOTES ..................... 0.1 968
REPURCHASE AGREEMENT ........................ 3.1 37,868
SHORT-TERM INVESTMENT ....................... 15.6 191,138
----- ----------
TOTAL INVESTMENTS ........................... 115.6 1,418,574
OTHER ASSETS (LIABILITIES) (NET) ............ (15.6) (191,027)
----- ----------
NET ASSETS .................................. 100.0% $1,227,547
===== ==========
GLOSSARY OF TERMS
ADR -- American Depositary Receipt
AUD -- Australian Dollar
BHD -- Bahraini Dollar
CAD -- Canadian Dollar
CDI -- CHESS Depositary Interest
CHF -- Swiss Franc
CPO -- Ordinary Participation Certificate
EUR -- Euro
(F) -- Foreign Shares
FDR -- Fiduciary Depositary Receipt
GBP -- Great Britain Pound Sterling
GDR -- Global Depositary Receipt
HKD -- Hong Kong Dollar
JPY -- Japanese Yen
NVDR -- Non-Voting Depositary Receipt
ZAR -- South African Rand
48 See Notes to Financial Statements.
Portfolio of Investments
SHORT TERM INCOME FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES - 56.8%
FINANCIAL SERVICES - 10.9%
$ 6,000 Berkshire Hathaway Inc., Note,
3.375% due 10/15/2008 .................. $ 5,752
1,500 CIT Group Inc., Sr. Note,
7.375% due 04/02/2007 .................. 1,528
3,750 Countrywide Home Loans, Inc., Company .....
Guarantee, Series K,
5.500% due 02/01/2007 .................. 3,753
2,500 Goldman Sachs Group, Inc., Note,
4.125% due 01/15/2008 .................. 2,453
Household Finance Corporation, Note: ......
3,500 5.750% due 01/30/2007 .................. 3,513
1,500 7.875% due 03/01/2007 .................. 1,530
2,000 Nuveen Investments, Inc., Sr. Note,
5.000% due 09/15/2010 .................. 1,927
3,500 Rollins Truck Leasing Corporation, Deb.,
8.375% due 02/15/2007 .................. 3,578
4,000 SLM Corporation, MTN,
4.000% due 01/15/2009 .................. 3,848
-----------
27,882
-----------
BANKS - 8.8%
5,750 Fifth Third Bank, Note,
2.700% due 01/30/2007 .................. 5,635
3,000 JPMorgan Chase & Company, Note,
5.350% due 03/01/2007 .................. 3,002
3,500 MBNA America Bank N.A., Note,
6.500% due 06/20/2006 .................. 3,506
5,000 SB Treasury Company LLC, Bond,
9.400% to 06/30/2008;
10.925% due 12/29/2049** ............... 5,364
5,000 U.S. Bank N.A., Note,
2.850% due 11/15/2006 .................. 4,938
-----------
22,445
-----------
REAL ESTATE INVESTMENT TRUSTS/PROPERTY - 6.3%
4,000 CPG Partners LP, Note,
3.500% due 03/15/2009 .................. 3,799
4,250 Developers Diversified Realty Corporation,
Sr. Note,
6.625% due 01/15/2008 .................. 4,321
4,000 Duke-Weeks Realty Corporation, Note,
7.375% due 08/01/2007 .................. 4,087
3,750 EOP Operating LP, Note,
7.750% due 11/15/2007 .................. 3,871
-----------
16,078
-----------
CABLE TV - 4.3%
4,000 AOL Time Warner Inc., Note,
6.150% due 05/01/2007 .................. 4,029
4,000 Cox Enterprises, Inc., Note,
4.375% due 05/01/2008** ................ 3,888
3,000 Univision Communications Inc., Company
Guarantee,
7.850% due 07/15/2011 .................. 3,134
-----------
11,051
-----------
GAMING/LEISURE - 4.1%
$ 5,750 Carnival Corporation, Company Guarantee,
3.750% due 11/15/2007 .................. $ 5,608
5,000 Harrah's Operating Company, Inc., Company
Guarantee,
5.500% due 07/01/2010 .................. 4,946
-----------
10,554
-----------
UTILITIES - 3.9%
4,000 Constellation Energy Group, Inc., Note,
6.350% due 04/01/2007 .................. 4,030
1,650 Pacific Gas & Electric Company, First
Mortgage, 3.600% due 03/01/2009 ........ 1,572
1,650 Sempra Energy, Note,
4.750% due 05/15/2009 .................. 1,616
2,750 Texas-New Mexico Power Company, Sr. Note,
6.250% due 01/15/2009 .................. 2,774
-----------
9,992
-----------
HEALTH CARE - 3.6%
5,500 Amgen Inc., Sr. Note,
4.000% due 11/18/2009 .................. 5,255
4,000 Cardinal Health, Inc., Note,
6.250% due 07/15/2008 .................. 4,063
-----------
9,318
-----------
AUTO MANUFACTURING & PARTS - 3.5%
4,000 Ford Motor Credit Company, Note,
6.500% due 01/25/2007 .................. 3,976
5,000 Toyota Motor Credit Corporation, Note,
5.650% due 01/15/2007 .................. 5,013
-----------
8,989
-----------
SERVICES - 2.5%
3,500 PHH Corporation, Note,
6.000% due 03/01/2008 .................. 3,522
3,000 Sealed Air Corporation, Conv. Sr. Note,
3.000% due 06/30/2033** ................ 2,857
-----------
6,379
-----------
TELECOMMUNICATIONS - 1.9%
1,500 TELUS Corporation, Note,
7.500% due 06/01/2007 .................. 1,532
3,500 Verizon Global Funding Corporation, Note,
4.000% due 01/15/2008 .................. 3,422
-----------
4,954
-----------
BUILDING PRODUCTS - 1.9%
4,750 Mohawk Industries, Inc., Note, Series D,
7.200% due 04/15/2012 .................. 4,944
-----------
INFORMATION TECHNOLOGY - 1.7%
4,250 Cisco Systems, Inc., Note,
5.250% due 02/22/2011 .................. 4,212
-----------
See Notes to Financial Statements. 49
Portfolio of Investments (continued)
SHORT TERM INCOME FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES (CONTINUED)
AIRLINES - 1.6%
$ 4,000 Southwest Airlines Company, Pass-through
Certificates,
5.496% due 11/01/2006 .................. $ 4,008
-----------
DIVERSIFIED MANUFACTURING - 0.8%
2,000 United Technologies Corporation, Note,
4.375% due 05/01/2010 .................. 1,926
-----------
FOOD - 0.6%
1,500 CVS Corporation, Note,
4.000% due 09/15/2009 .................. 1,431
-----------
AEROSPACE/DEFENSE - 0.4%
1,000 Boeing Capital Corporation, Sr. Note,
5.650% due 05/15/2006 .................. 1,000
-----------
Total Corporate Bonds and Notes
(Cost $147,884) ........................ 145,163
-----------
COLLATERALIZED MORTGAGE
OBLIGATIONS (CMOS) - 14.9%
4,000 Banc of America Mortgage Securities, Inc.,
Pass-through Certificates, Series
2003-6, Class 1A30,
4.750% due 08/25/2033 .................. 3,870
4,223 Cendant Mortgage Corporation, Series
2003-3P, Class A1,
5.500% due 04/25/2020** ................ 4,170
4,604 Chase Mortgage Finance Corporation, Series
2005-S1, Class 1A8,
5.500% due 05/25/2035 .................. 4,553
2,375 Credit Suisse First Boston Mortgage
Securities Corporation, Pass-through
Certificates, Series 2003-29, Class 4A1,
6.000% due 12/25/2033 .................. 2,378
Federal Home Loan Mortgage Corporation:
2,994 Series 2442, Class PG,
6.000% due 06/15/2030 .................. 3,011
2,333 Series 2552, Class KB,
4.250% due 06/15/2027 .................. 2,308
1,732 Series 2575, Class LM,
4.500% due 05/15/2032 .................. 1,682
5,000 Series 2811, Class NU,
4.500% due 05/15/2030 .................. 4,760
Federal National Mortgage Association:
871 Series 2002-58, Class HB,
5.500% due 11/25/2015 .................. 870
4,898 Series 2005-100, Class QA,
5.000% due 11/25/2035 .................. 4,821
2,317 Government National Mortgage Association,
Series 2002-70, Class PA,
4.500% due 08/20/2032 .................. 2,215
3,425 GSR Mortgage Loan Trust, Pass-through
Certificates, Series 2005-1F, Class 2A1,
6.000% due 02/25/2035 .................. 3,404
-----------
Total CMOs
(Cost $39,048) ......................... 38,042
-----------
U.S. GOVERNMENT AGENCY OBLIGATIONS - 9.7%
Federal Home Loan Bank:
$ 4,000 Bond,
1.875% due 06/15/2006 .................. $ 3,984
4,827 Series 00-0606, Class Y,
5.270% due 12/28/2012 .................. 4,758
Federal Home Loan Mortgage Corporation:
3,500 Bond,
3.250% due 02/25/2008 .................. 3,384
1,000 Note,
4.125% due 07/12/2010 .................. 959
Federal National Mortgage Association:
Note:
4,000 4.250% due 07/15/2007 .................. 3,958
3,000 3.000% to 07/16/2006;
5.800% due 07/16/2013 .................. 2,960
5,000 Sub. Note,
4.000% due 09/02/2008 ..................... 4,866
-----------
Total U.S. Government Agency Obligations
(Cost $25,343) ......................... 24,869
-----------
U.S. TREASURY NOTES - 6.4%
6,000 2.000% due 05/15/2006 ..................... 5,995
6,000 2.625% due 03/15/2009 ..................... 5,642
5,000 3.250% due 08/15/2008 ..................... 4,827
-----------
Total U.S. Treasury Notes
(Cost $16,661) 16,464
-----------
ASSET-BACKED SECURITIES (ABSS) - 4.8%
2,522 Atlantic City Electric Transition
Funding LLC, Series 2003-1, Class A1,
2.890% due 07/20/2011 .................. 2,428
5,000 Capital One Multi-Asset Execution Trust,
Series 2003-A6, Class A6,
2.950% due 08/17/2009 .................. 4,955
120 Green Tree Financial Corporation,
Series 1995-6, Class B1,
7.700% due 09/15/2026 .................. 106
4,750 WFS Financial Owner Trust, Series 2004-3,
Class A4,
3.930% due 02/17/2012 .................. 4,656
-----------
Total ABSs
(Cost $12,388) ......................... 12,145
-----------
U.S. GOVERNMENT AGENCY
MORTGAGE-BACKED SECURITIES - 1.4%
ADJUSTABLE RATE MORTGAGE-BACKED
SECURITIES (ARMS) - 0.5%
78 Federal Home Loan Mortgage Corporation
(FHLMC),
3.756% due 11/01/2021+ ................. 79
Federal National Mortgage
Association (FNMA):
1,174 4.646% due 11/01/2032+ ................. 1,178
30 4.807% due 01/01/2019+ ................. 30
48 5.000% due 11/01/2035+ ................. 47
6 5.540% due 11/01/2022+ ................. 7
9 5.610% due 04/01/2019+ ................. 9
50 See Notes to Financial Statements.
Portfolio of Investments (continued)
SHORT TERM INCOME FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
U.S. GOVERNMENT AGENCY
MORTGAGE-BACKED SECURITIES (CONTINUED)
ADJUSTABLE RATE MORTGAGE-BACKED
SECURITIES (ARMS) (CONTINUED)
$ 19 5.875% due 11/01/2021+ .................... $ 19
-----------
Total ARMs
(Cost $1,416) .......................... 1,369
-----------
FEDERAL HOME LOAN MORTGAGE
CORPORATION (FHLMC) - 0.5%
1,121 6.000% due 04/01/2017-05/01/2017 .......... 1,135
21 9.500% due 08/01/2016 ..................... 22
-----------
Total FHLMC
(Cost $1,161) .......................... 1,157
-----------
FEDERAL NATIONAL MORTGAGE
ASSOCIATION (FNMA) - 0.3%
567 6.500% due 01/01/2012-01/01/2014 .......... 579
34 8.500% due 11/01/2017 ..................... 36
21 10.000% due 05/01/2022 .................... 23
-----------
Total FNMA
(Cost $623) 638
-----------
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION (GNMA) - 0.1%
5 8.000% due 03/15/2012 ..................... 6
6 9.000% due 04/20/2025 ..................... 7
135 10.000% due 01/15/2019-02/15/2019 ......... 149
127 11.000% due 02/15/2010-08/15/2020 ......... 140
-----------
Total GNMA
(Cost $294) ............................ 302
-----------
Total U.S. Government Agency
Mortgage-Backed Securities
(Cost $3,494) .......................... 3,466
-----------
COMMERCIAL MORTGAGE-BACKED
SECURITIES (CMBS) - 0.4%
(Cost $888)
888 GMAC Commercial Mortgage
Securities Inc., Series 1999-CTL1,
Class A, 7.150% due 12/15/2016** ....... 900
-----------
REPURCHASE AGREEMENT - 4.8%
(Cost $12,395)
12,395 Agreement with Credit Suisse First
Boston Corporation, 4.660% dated 04/28/2006,
to be repurchased at $12,400,000 on
05/01/2006 (collateralized by
U.S. Treasury obligations, having
various interest rates and maturities,
market value $12,659,000) .............. 12,395
-----------
TOTAL INVESTMENTS++ (Cost $258,101*) ..................... 99.2% 253,444
OTHER ASSETS (LIABILITIES) (NET) ......................... 0.8 2,130
----- -----------
NET ASSETS ............................................... 100.0% $ 255,574
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Security acquired in a transaction exempt from registration under Rule
144A of the Securities Act of 1933, as amended.
+ Variable rate security. The interest rate shown reflects the rate in effect
at April 30, 2006.
++ All securities segregated as collateral for futures contracts.
UNREALIZED
NUMBER OF VALUE APPRECIATION
CONTRACTS (000S) (000S)
- --------- ------- ------------
FUTURES CONTRACTS-SHORT POSITION
100 U.S. 5 Year Treasury Note, June 2006 ..... $10,416 $37
======= ===
GLOSSARY OF TERMS
MTN -- Medium-Term Note
See Notes to Financial Statements. 51
Portfolio of Investments
U.S. GOVERNMENT SECURITIES FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
U.S. GOVERNMENT AGENCY
MORTGAGE-BACKED SECURITIES - 68.6%
FEDERAL HOME LOAN MORTGAGE
CORPORATION (FHLMC) - 33.6%
$ 15,431 4.000% due 08/01/2018 ..................... $ 14,398
82,792 4.500% due 04/01/2018-06/01/2035 .......... 77,543
199,474 5.000% due 04/01/2018-10/01/2035 .......... 189,210
199,085 5.500% due 11/01/2018-10/01/2035 .......... 194,299
81,421 6.000% due 04/01/2017-02/01/2035 .......... 81,398
26,637 6.500% due 02/01/2011-01/01/2032 .......... 27,288
7,928 7.000% due 07/01/2024-04/01/2032 .......... 8,169
3,394 7.500% due 12/01/2006-02/01/2031 .......... 3,500
136 8.000% due 12/01/2030 ..................... 144
416 8.500% due 04/01/2019-07/01/2029 .......... 444
20 8.750% due 01/01/2013 ..................... 21
77 9.000% due 12/01/2008-08/01/2022 .......... 81
36 9.500% due 06/01/2016-04/01/2017 .......... 39
-----------
Total FHLMC
(Cost $620,033) ........................ 596,534
-----------
FEDERAL NATIONAL MORTGAGE
ASSOCIATION (FNMA) - 30.0%
36,456 4.500% due 12/01/2018-11/01/2019 .......... 34,793
111,062 5.000% due 04/01/2018-06/01/2035 .......... 107,079
243,997 5.500% due 02/01/2009-10/01/2035 .......... 237,712
90,029 6.000% due 12/01/2016-10/01/2035 .......... 89,982
54,629 6.500% due 09/01/2024-02/01/2036 .......... 55,729
5,528 7.000% due 06/01/2010-07/01/2032 .......... 5,703
1,692 7.500% due 12/01/2024-02/01/2030 .......... 1,769
211 8.000% due 05/01/2022-01/01/2025 .......... 215
35 8.500% due 02/01/2023-09/01/2025 .......... 36
302 9.000% due 03/01/2017-09/01/2030 .......... 331
-----------
Total FNMA
(Cost $552,494) ........................ 533,349
-----------
GOVERNMENT NATIONAL MORTGAGE
ASSOCIATION (GNMA) - 5.0%
40,894 5.500% due 07/20/2033-03/20/2034 .......... 40,012
31,350 6.000% due 04/20/2026-08/15/2034 .......... 31,478
11,098 6.500% due 03/15/2024-05/20/2034 .......... 11,338
113 6.800% due 04/20/2025 ..................... 116
2,287 7.000% due 07/15/2008-06/20/2031 .......... 2,373
2,079 7.500% due 03/15/2024-11/15/2029 .......... 2,181
89 7.750% due 12/15/2029 ..................... 94
134 8.000% due 04/15/2022 ..................... 142
439 9.000% due 11/15/2021 ..................... 473
897 9.500% due 04/15/2016-08/15/2021 .......... 986
10 13.500% due 09/15/2014-12/15/2014 ......... 12
-----------
Total GNMA
(Cost $91,518) ......................... 89,205
-----------
ADJUSTABLE RATE MORTGAGE-BACKED
SECURITIES (ARMS) - 0.0%
(Cost $85)
$ 85 Federal National Mortgage Association,
6.528% due 03/01/2028+ ................. $ 86
-----------
Total U.S. Government Agency
Mortgage-Backed Securities
(Cost $1,264,130) ...................... 1,219,174
-----------
COLLATERALIZED MORTGAGE
OBLIGATIONS (CMOS) - 20.0%
Banc of America Mortgage Securities, Inc.,
Pass-through Certificates:
21,500 Series 2003-6, Class 1A30,
4.750% due 08/25/2033 .................. 20,801
14,125 Series 2004-4, Class 2A1,
5.500% due 05/25/2034 13,337
21,000 Chase Mortgage Finance Corporation,
Series 2005-S1, Class 1A15,
6.000% due 05/25/2035 .................. 20,750
5,612 Countrywide Alternative Loan Trust,
Series 2003-13T1, Class A1,
4.000% due 08/25/2033 .................. 5,478
Countrywide Home Loans:
18,715 Series 2003-50, Class A1,
5.000% due 11/25/2018 .................. 18,124
21,500 Series 2004-4, Class A5,
5.250% due 05/25/2034 .................. 20,129
Credit Suisse First Boston Mortgage
Securities Corporation,
Pass-through Certificates:
12,864 Series 2003-11, Class 1A3,
4.500% due 06/25/2033 .................. 12,630
8,039 Series 2003-29, Class 4A1,
6.000% due 12/25/2033 .................. 8,048
11,620 Series 2003-8, Class 1A1,
5.750% due 04/25/2033 .................. 11,345
Federal Home Loan Mortgage
Corporation:
213 Series 1049, Class F,
5.650% due 02/15/2021++ ................ 213
724 Series 1981, Class C,
6.500% due 08/15/2027 .................. 732
7,447 Series 2435, Class GE,
6.500% due 06/15/2031 .................. 7,558
3,293 Series 2442, Class PG,
6.000% due 06/15/2030 .................. 3,312
19,445 Series 2449, Class ND,
6.500% due 05/15/2030 19,658
12,122 Series 2481, Class VC,
6.000% due 06/15/2017 .................. 12,255
9,000 Series 2551, Class QK,
5.500% due 01/15/2033 .................. 8,701
5,889 Series 2575, Class LM,
4.500% due 05/15/2032 .................. 5,719
26,023 Series 2634, Class IN,
5.000% due 09/15/2027 .................. 2,994
25,000 Series 2981, Class PC,
5.500% due 10/15/2031 .................. 24,389
52 See Notes to Financial Statements.
Portfolio of Investments (continued)
U.S. GOVERNMENT SECURITIES FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
COLLATERALIZED MORTGAGE
OBLIGATIONS (CMOS) (CONTINUED)
Federal National Mortgage Association:
$ 7,000 Grantor Trust, Series 2000-T5, Class B,
7.300% due 05/25/2010 .................. $ 7,497
10,610 Series 2002-16, Class TM,
7.000% due 04/25/2032 .................. 10,908
21,000 Series 2002-86, Class JC,
5.500% due 02/25/2032 .................. 20,484
17,847 Series 2003-58, Class PI,
5.000% due 02/25/2027 .................. 1,129
488 Trust 259 STRIP,
7.000% due 04/01/2024 .................. 119
Federal National Mortgage Association,
REMIC, Pass-through Certificates:
112 Series 1990-49, Class G,
9.000% due 05/25/2020 .................. 118
40 Series 1993-162, Class E,
6.000% due 08/25/2023 .................. 40
100 Series 1997-32, Class FA,
5.444% due 04/25/2027++ ................ 102
GSR Mortgage Loan Trust,
Pass-through Certificates:
9,313 Series 2003-4F, Class 2A3,
5.000% due 05/25/2033 .................. 9,252
15,072 Series 2005-1F, Class 2A1,
6.000% due 02/25/2035 .................. 14,979
74 L.F. Rothschild Mortgage Trust,
Series 3, Class Z,
9.950% due 09/01/2017 .................. 79
Prime Mortgage Trust:
20,839 Series 2004-2, Class A2,
4.750% due 11/25/2019 .................. 19,894
20,355 Series 2005-4, Class 1A1,
4.750% due 10/25/2020 .................. 19,623
17,000 Residential Funding Mortgage Security,
Series 2003-S20, Class 1A4,
5.500% due 12/25/2033 .................. 16,415
19,354 Structured Asset Securities
Corporation,
Series 2005-6, Class 4A1,
5.000% due 05/25/2035 .................. 18,235
-----------
Total CMOs
(Cost $365,579) ........................ 355,047
-----------
U. S. GOVERNMENT AGENCY OBLIGATIONS - 4.3%
10,000 Federal Home Loan Bank, Bond,
2.875% due 09/15/2006 .................. 9,917
10,000 Federal Home Loan Mortgage Corporation,
Sub. Note,
5.875% due 03/21/2011 .................. 10,184
Federal National Mortgage Association:
10,000 Bond,
3.250% due 01/15/2008 .................. 9,699
1,250 Deb.,
6.210% due 08/06/2038 .................. 1,366
Note:
$ 7,500 6.000% due 05/15/2008 .................. $ 7,628
20,000 6.000% due 02/03/2020 .................. 19,451
18,000 3.000% to 07/16/2006;
5.800% due 07/16/2013 .................. 17,758
-----------
Total U.S. Government Agency Obligations
(Cost $76,204) ...................... 76,003
-----------
U.S. TREASURY NOTES - 3.9%
10,000 3.250% due 08/15/2007 .................. 9,798
10,000 3.500% due 12/15/2009 .................. 9,543
37,000 4.000% due 04/15/2010-02/15/2014 ....... 35,247
15,000 4.250% due 08/15/2014 .................. 14,210
-----------
Total U.S. Treasury Notes
(Cost $72,284) ...................... 68,798
-----------
REPURCHASE AGREEMENT - 2.8%
(Cost $49,518)
49,518 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006, to
be repurchased at $49,537,000 on
05/01/2006 (collateralized by U.S.
Treasury obligations, having various
interest rates and maturities, market
value $50,571,000) ..................... 49,518
-----------
TOTAL INVESTMENTS (Cost $1,827,715*) ..................... 99.6% 1,768,540
OTHER ASSETS (LIABILITIES) (NET) ......................... 0.4 7,359
----- -----------
NET ASSETS ............................................... 100.0% $ 1,775,899
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
+ Variable rate security. The interest rate shown reflects the rate in effect
at April 30, 2006.
++ Floating rate security whose interest rate is reset periodically based on
an index.
GLOSSARY OF TERMS
REMIC -- Real Estate Mortgage Investment Conduit
STRIP -- Separate trading of registered interest and principal of securities
See Notes to Financial Statements. 53
Portfolio of Investments
INCOME FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES - 64.3%
FINANCIAL SERVICES/BANKS - 11.8%
$ 6,500 American General Finance, Inc.,
MTN, Series I,
4.625% due 05/15/2009 .................. $ 6,376
400 Banc One Corporation, Sub. Note,
10.000% due 08/15/2010 ................. 462
5,000 Bank of America Corporation, Sub. Note,
7.800% due 02/15/2010 .................. 5,386
1,000 BankAmerica Corporation, Sub. Note,
6.625% due 08/01/2007 1,015
690 BB&T Corporation, Sub. Note,
7.250% due 06/15/2007 .................. 704
CIT Group Inc.:
7,000 Bond,
5.400% due 01/30/2016 .................. 6,671
Sr. Note:
2,000 5.000% due 02/01/2015 .................. 1,867
3,000 7.750% due 04/02/2012 .................. 3,290
10,000 Citigroup Inc., Note,
6.000% due 02/21/2012 .................. 10,200
6,000 Farmers Insurance Exchange, Note,
6.000% due 08/01/2014** ................ 5,846
1,000 First Nationwide Bank, Sub. Deb.,
10.000% due 10/01/2006 ................. 1,018
995 Fleet Financial Group, Inc., Sub. Deb.,
6.875% due 01/15/2028 .................. 1,061
Goldman Sachs Group, Inc.:
10,000 Note,
6.600% due 01/15/2012 .................. 10,446
2,000 Sr. Note,
5.350% due 01/15/2016 .................. 1,915
7,500 Jefferies Group, Inc., Sr. Note,
7.750% due 03/15/2012 .................. 8,137
12,000 JPMorgan Chase & Company, Sub. Note,
5.125% due 09/15/2014 .................. 11,434
3,000 Legg Mason, Inc., Sr. Note,
6.750% due 07/02/2008 .................. 3,082
5,000 MBNA America Bank NA, Sub. Note,
7.125% due 11/15/2012 .................. 5,392
MBNA Corporation:
3,000 Note,
6.250% due 01/17/2007 .................. 3,020
2,000 Sr. Note,
7.500% due 03/15/2012 2,188
Merrill Lynch & Company Inc., Note:
3,000 5.000% due 01/15/2015 .................. 2,837
5,000 6.000% due 02/17/2009 .................. 5,084
2,000 6.500% due 07/15/2018 .................. 2,093
2,000 6.750% due 06/01/2028 .................. 2,078
7,500 Morgan Stanley Dean Witter & Company, Note,
6.750% due 04/15/2011 .................. 7,872
5,000 Morgan Stanley, Sub. Note,
4.750% due 04/01/2014 .................. 4,631
670 NationsBank Corporation, Sub. Note,
6.800% due 03/15/2028 .................. 709
$ 830 Paine Webber Group, Inc., Sr. Note,
8.060% due 01/17/2017 .................. $ 978
500 PNC Institute Capital B, Company Guarantee,
8.315% due 05/15/2027** ................ 531
10,000 SB Treasury Company LLC, Bond,
9.400% to 06/30/2008;
10.925% due 12/29/2049** ............... 10,729
U.S. Bank NA, Sub. Note:
6,000 4.950% due 10/30/2014 .................. 5,662
5,000 6.375% due 08/01/2011 .................. 5,191
11,000 Wells Fargo & Company, Sub. Note,
4.625% due 04/15/2014 .................. 10,199
-----------
148,104
-----------
UTILITIES - 8.6%
5,000 Arizona Public Service Company, Note,
6.500% due 03/01/2012 .................. 5,095
10,000 Dominion Resources, Inc., Sr. Note,
5.000% due 03/15/2013 .................. 9,425
9,000 Illinois Power Company, First Mortgage,
7.500% due 06/15/2009 .................. 9,468
7,000 Metropolitan Edison Company, Sr. Note,
4.950% due 03/15/2013 .................. 6,634
NiSource Finance Corporation:
5,000 Bond,
5.400% due 07/15/2014 .................. 4,788
5,000 Sr. Note,
6.150% due 03/01/2013 .................. 5,052
4,000 Ohio Edison Company, Sr. Note,
5.450% due 05/01/2015 .................. 3,837
5,000 Ohio Power Company, Sr. Note,
5.500% due 02/15/2013 .................. 4,891
Oncor Electric Delivery Company, Deb.:
1,000 5.000% due 09/01/2007 .................. 994
9,000 7.000% due 09/01/2022 .................. 9,420
10,250 Pacific Gas & Electric Company,
First Mortgage,
4.200% due 03/01/2011 .................. 9,667
PacifiCorp, First Mortgage:
7,500 4.950% due 08/15/2014 .................. 7,121
3,000 5.250% due 06/15/2035 .................. 2,603
5,000 PPL Energy Supply LLC, Sr. Note,
6.400% due 11/01/2011 ................. 5,147
2,000 Public Service Company of New Mexico, Sr.
Note,
4.400% due 09/15/2008 .................. 1,943
9,000 Sempra Energy, Note,
6.000% due 02/01/2013 .................. 9,027
6,500 Southwestern Electric Power Company, Note,
5.375% due 04/15/2015 .................. 6,202
6,845 Texas-New Mexico Power Company, Sr. Note,
6.250% due 01/15/2009 .................. 6,905
-----------
108,219
-----------
OIL & GAS - 6.6%
7,500 Consolidated Natural Gas Company, Sr. Note,
6.850% due 04/15/2011 .................. 7,865
54 See Notes to Financial Statements.
Portfolio of Investments (continued)
INCOME FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES (CONTINUED)
OIL & GAS (CONTINUED)
$ 10,000 El Paso Natural Gas Company, Deb.,
7.500% due 11/15/2026 .................. $ 10,160
6,000 Enterprise Products Partners LP,
Company Guarantee,
6.375% due 02/01/2013 6,097
5,005 Express Pipeline LP, Sub. Note,
7.390% due 12/31/2017** ................ 5,121
Hanover Compressor Company:
1,500 Conv. Sr. Note,
4.750% due 03/15/2008 .................. 1,464
9,000 Sr. Note,
8.625% due 12/15/2010 .................. 9,427
Petro-Canada:
8,500 Deb.,
9.250% due 10/15/2021 .................. 10,757
3,000 Note,
4.000% due 07/15/2013 .................. 2,677
8,000 Petrobras International Finance Company,
Sr. Note,
9.750% due 07/06/2011 .................. 9,340
Southern Natural Gas Company, Sr. Note:
4,000 8.000% due 03/01/2032 .................. 4,296
1,000 8.875% due 03/15/2010 .................. 1,067
2,000 Tennessee Gas Pipeline Company, Bond,
8.375% due 06/15/2032 .................. 2,220
12,000 Tesoro Corporation, Sr. Note,
6.250% due 11/01/2012** ................ 11,820
-----------
82,311
-----------
REAL ESTATE INVESTMENT TRUSTS (REITS) - 5.9%
2,000 American Health Properties, Inc., Note,
7.500% due 01/15/2007 .................. 2,031
Arden Realty LP, Note:
3,000 5.200% due 09/01/2011 .................. 2,966
7,000 5.250% due 03/01/2015 .................. 6,742
10,000 Developers Diversified Realty Corporation,
Note,
4.625% due 08/01/2010 .................. 9,573
3,000 Franchise Finance Corporation, MTN,
7.070% due 01/15/2008 .................. 3,084
Health Care Property Investors, Inc.:
1,750 Note,
6.000% due 03/01/2015 .................. 1,730
Sr. Note:
3,000 6.450% due 06/25/2012 .................. 3,097
2,250 7.072% due 06/08/2015 .................. 2,370
Health Care REIT, Inc.:
3,000 6.200% due 06/01/2016 .................. 2,940
Sr. Note:
8,000 6.000% due 11/15/2013 .................. 7,802
1,500 7.500% due 08/15/2007 .................. 1,525
Healthcare Realty Trust, Inc., Sr. Note:
1,000 5.125% due 04/01/2014 .................. 927
7,500 8.125% due 05/01/2011 .................. 8,157
$ 12,000 Nationwide Health Properties, Note,
6.000% due 05/20/2015 .................. $ 11,566
9,000 Shurgard Storage Centers, Inc., Note,
5.875% due 03/15/2013 .................. 9,008
-----------
73,518
-----------
CONSUMER PRODUCTS/SERVICES - 5.3%
Allied Waste North America, Inc., Sr. Note:
9,000 7.250% due 03/15/2015** ................ 9,202
1,000 7.875% due 04/15/2013 .................. 1,045
4,000 Cendant Corporation, Note,
6.875% due 08/15/2006 .................. 4,014
10,200 Corn Products International, Inc., Sr.
Note,
8.450% due 08/15/2009 .................. 11,000
1,000 Mattel, Inc., Note,
7.300% due 06/13/2011 .................. 1,045
10,000 Reed Elsevier Capital Inc.,
Company Guarantee,
6.750% due 08/01/2011 .................. 10,436
Royal Caribbean Cruises Ltd.:
2,000 Deb.,
7.250% due 03/15/2018 .................. 2,077
Sr. Note:
3,000 6.875% due 12/01/2013 .................. 3,074
1,250 8.000% due 05/15/2010 .................. 1,341
3,000 8.750% due 02/02/2011 .................. 3,318
Sealed Air Corporation:
7,250 Conv. Sr. Note,
3.000% due 06/30/2033** ................ 6,906
4,000 Note,
5.625% due 07/15/2013** ................ 3,892
USA Waste Services, Inc., Sr. Note:
1,000 7.000% due 07/15/2028 .................. 1,041
495 7.125% due 10/01/2007 .................. 506
Waste Management Inc.:
3,450 Company Guarantee,
6.875% due 05/15/2009 .................. 3,582
3,500 Sr. Note,
7.375% due 08/01/2010 .................. 3,720
-----------
66,199
-----------
HEALTH CARE - 4.9%
11,000 Athena Neurosciences Finance LLC,
Company Guarantee,
7.250% due 02/21/2008 .................. 10,986
10,000 Cardinal Health, Inc., Note,
6.750% due 02/15/2011 .................. 10,435
DVI, Inc., Sr. Note, (in default):
8,125 9.875% due 02/01/2007+ ................. 1,178
400 9.875% due 02/01/2007+ ................. 58
HCA Inc.:
3,000 Note,
5.250% due 11/06/2008 .................. 2,965
5,000 Sr. Note,
6.950% due 05/01/2012 .................. 5,042
12,000 Health Management PLC, Sr. Note,
6.125% due 04/15/2016 .................. 11,930
See Notes to Financial Statements. 55
Portfolio of Investments (continued)
INCOME FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES (CONTINUED)
HEALTH CARE (CONTINUED)
$ 7,350 IVAX Corporation, Conv. Sr. Sub. Note,
4.500% due 05/15/2008 .................. $ 7,442
12,000 Tenet Healthcare Corporation, Sr. Note,
6.375% due 12/01/2011 .................. 11,190
-----------
61,226
-----------
TRANSPORTATION/AUTO - 4.2%
Burlington Northern Santa Fe Corporation:
10,000 Deb.,
8.125% due 04/15/2020 .................. 11,910
1,500 Note,
8.750% due 02/25/2022 .................. 1,871
3,300 CSX Transportation, Inc., Deb.,
9.750% due 06/15/2020 4,319
Norfolk Southern Corporation:
5,000 Deb.,
9.750% due 06/15/2020 .................. 6,600
5,000 Sr. Note,
6.200% due 04/15/2009 .................. 5,102
12,000 Trailer Bridge, Inc.,
Sr. Sec. Note,
9.250% due 11/15/2011 .................. 12,375
5,000 Union Pacific Corporation, Note,
3.875% due 02/15/2009 .................. 4,817
United Air Lines Inc.:
5,000 Equipment Trust Certificates, (in
default), 10.850% due 07/05/2014 ....... 2,325
Pass-through Certificates, (in default):
2,913 9.080% due 10/26/2015 .................. 909
4,806 9.560% due 10/19/2018 .................. 2,571
-----------
52,799
-----------
GAMING - 4.0%
11,000 CCM Merger Inc., Note,
8.000% due 08/01/2013** ................ 10,725
5,000 Circus Circus Enterprise Inc., Deb.,
7.000% due 11/15/2036 .................. 5,137
3,500 Harrah's Operating Company Inc.,
Company Guarantee,
8.000% due 02/01/2011 .................. 3,792
3,000 Mandalay Resort Group, Sr. Sub. Note,
Series B,
10.250% due 08/01/2007 ................. 3,158
12,000 Old Evangeline Downs LLC / Diamond Jo
LLC, Company Guarantee,
8.750% due 04/15/2012 .................. 12,060
Park Place Entertainment Corporation,
Sr. Note:
1,500 7.500% due 09/01/2009 .................. 1,581
5,000 8.500% due 11/15/2006 .................. 5,078
7,900 Riviera Holdings Corporation,
Company Guarantee,
11.000% due 06/15/2010 ................. 8,423
-----------
49,954
-----------
TELECOMMUNICATIONS - 2.6%
5,000 Deutsche Telephone Finance, Bond,
8.500% due 06/15/2010 .................. 5,440
$ 8,000 Qwest Corporation, Note,
8.875% due 03/15/2012 .................. $ 8,800
9,000 TELUS Corporation, Note,
8.000% due 06/01/2011 .................. 9,890
8,000 Vodafone Group PLC, Note,
7.750% due 02/15/2010 .................. 8,556
-----------
32,686
-----------
MEDIA - 2.4%
Comcast Cable Communications Inc.:
550 Note,
6.200% due 11/15/2008 .................. 560
7,000 Sr. Note,
7.125% due 06/15/2013 .................. 7,390
8,000 Cox Communications, Inc., Note,
6.750% due 03/15/2011 .................. 8,258
2,500 FrontierVision Holdings LP,
Sr. Disc. Note, (in default),
11.875% due 09/15/2007 ................. 2,900
2,000 FrontierVision Operating Partners LP,
Sr. Sub. Note, (in default),
11.000% due 10/15/2006 ................. 2,750
2,000 Tele-Communications, Inc., Sr. Deb.,
7.875% due 08/01/2013 .................. 2,191
5,260 Time Warner Inc., Deb.,
9.150% due 02/01/2023 .................. 6,300
-----------
30,349
-----------
INFORMATION TECHNOLOGY - 2.2%
11,250 Conexant Systems Inc., Conv. Sub. Note,
4.000% due 02/01/2007 .................. 11,138
12,000 Corning Inc., Note,
5.900% due 03/15/2014 .................. 11,715
5,000 Extreme Networks, Inc., Conv. Sub. Note,
3.500% due 12/01/2006 .................. 5,000
-----------
27,853
-----------
INDUSTRIAL PRODUCTS - 1.6%
5,000 Champion International Corporation, Deb.,
7.200% due 11/01/2026 .................. 5,190
12,000 Noranda Inc., Note,
6.000% due 10/15/2015 .................. 11,685
Weyerhaeuser Company:
1,500 Deb.,
7.375% due 03/15/2032 .................. 1,571
1,500 Note,
6.750% due 03/15/2012 .................. 1,554
-----------
20,000
-----------
RETAIL - 1.3%
5,000 Fred Meyer Inc., Company Guarantee,
7.450% due 03/01/2008 .................. 5,160
6,000 Neiman Marcus Group Inc.,
Company Guarantee,
10.375% due 10/15/2015 ................. 6,450
5,000 Safeway Inc., Note,
7.500% due 09/15/2009 .................. 5,286
-----------
16,896
-----------
56 See Notes to Financial Statements.
Portfolio of Investments (continued)
INCOME FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES (CONTINUED)
AEROSPACE/DEFENSE - 1.1%
$ 3,000 Lockheed Martin Corporation,
Company Guarantee,
7.750% due 05/01/2026 .................. $ 3,485
1,000 Loral Corporation, Deb.,
7.625% due 06/15/2025 .................. 1,142
9,000 Orbital Sciences Corporation, Sr. Note,
9.000% due 07/15/2011 .................. 9,652
-----------
14,279
-----------
INDEX PRODUCT - 1.0%
12,000 Dow Jones CDX High Yield Series 6 Trust 1,
Pass-through Certificates,
8.625% due 06/29/2011 .................. 12,120
-----------
FOREIGN GOVERNMENT - 0.8%
Federal Republic of Brazil:
2,750 Bond,
9.250% due 10/22/2010 .................. 3,120
1,500 Note,
8.750% due 02/04/2025 .................. 1,699
5,000 United Mexican States, Bond,
9.875% due 02/01/2010 .................. 5,690
-----------
10,509
-----------
Total Corporate Bonds and Notes
(Cost $809,504) ........................ 807,022
-----------
U.S. GOVERNMENT AGENCY MORTGAGE-BACKED SECURITIES - 23.7%
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) - 14.7%
41,506 4.500% due 08/01/2033 ..................... 38,158
63,427 5.000% due 04/01/2018-11/01/2035 .......... 60,802
79,771 5.500% due 11/01/2017-04/01/2036 .......... 77,728
3,303 6.000% due 03/01/2031-05/01/2032 .......... 3,300
3,717 6.500% due 01/01/2029-08/01/2029 .......... 3,800
992 7.000% due 01/01/2032 ..................... 1,021
-----------
Total FHLMC
(Cost $190,760) ........................ 184,809
-----------
FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - 8.7%
38,179 4.000% due 09/01/2018-10/01/2018 .......... 35,649
10,301 5.000% due 01/01/2018-10/01/2032 .......... 9,949
49,004 5.500% due 03/01/2033-02/01/2035 .......... 47,705
1,550 6.000% due 04/01/2032 ..................... 1,547
4,915 6.500% due 09/01/2028-05/01/2032 .......... 5,014
77 7.000% due 01/01/2030 ..................... 79
187 7.451% due 06/01/2016 ..................... 203
8,000 7.630% due 02/01/2010 ..................... 8,460
-----------
Total FNMA
(Cost $112,709) ........................ 108,606
-----------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - 0.3%
$ 3,927 6.000% due 05/20/2032 ..................... $ 3,932
507 7.000% due 06/20/2031 ..................... 521
-----------
Total GNMA
(Cost $4,412) .......................... 4,453
-----------
Total U.S. Government Agency Mortgage-Backed
Securities
(Cost $307,881) ........................ 297,868
-----------
U.S. TREASURY OBLIGATIONS - 6.9%
U.S. TREASURY NOTES - 5.3%
25,000 4.250% due 08/15/2014 ..................... 23,684
44,000 4.000% due 06/15/2009 ..................... 42,886
-----------
Total U.S. Treasury Notes ................. 66,570
-----------
U.S. TREASURY BOND - 1.6%
20,000 5.375% due 02/15/2031 ..................... 20,306
-----------
Total U.S. Treasury Obligations
(Cost $92,519) ......................... 86,876
-----------
COLLATERALIZED MORTGAGE OBLIGATION (CMO) - 0.1%
(Cost $476)
475 Reilly Mortgage FHA, Series 1982,
(Partial default),
7.430% due 08/01/2022 .................. 475@
-----------
REPURCHASE AGREEMENT - 3.8%
(Cost $47,224)
47,224 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/06,
to be repurchased at $47,242,000 on
05/01/2006 (collateralized by U.S.
Treasury obligations, having various
interest rates and maturities,
market value $48,228,000) .............. 47,224
-----------
TOTAL INVESTMENTS (Cost $1,257,604*) 98.8% 1,239,465
OTHER ASSETS (LIABILITIES) (NET) 1.2 15,418
----- -----------
NET ASSETS 100.0% $ 1,254,883
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Security acquired in a transaction exempt from registration under Rule
144A of the Securities Act of 1933, as amended.
+ Defaulted security is past maturity but continues to be valued in recog-
nition of future potential worth.
@ Represents fair value as determined in good faith under the direction of
the Board of Trustees.
GLOSSARY OF TERMS
FHA -- Federal Housing Authority
MTN -- Medium-Term Note
See Notes to Financial Statements. 57
Portfolio of Investments
HIGH YIELD FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES - 87.7%
HEALTH CARE - 15.4%
$ 10,500 Alliance Imagining, Inc., Sr. Sub. Note,
7.250% due 12/15/2012 .................. $ 9,188
21,500 Athena Neurosciences Finance LLC,
Company Guarantee,
7.250% due 02/21/2008 .................. 21,473
16,500 CV Therapeutics, Inc., Conv. Sr. Sub. Deb.,
2.000% due 05/16/2023 .................. 13,984
DVI, Inc., Sr. Note, (in default):
8,575 9.875% due 02/01/2007++ ................ 1,243
6,850 9.875% due 02/01/2007++ ................ 993
20,000 HCA, Inc., Note,
7.500% due 11/06/2033 .................. 19,391
20,500 ICOS Corporation, Conv. Sub. Note,
2.000% due 07/01/2023 .................. 16,631
5,000 Inhale Therapeutic Systems, Inc.,
Conv. Sub. Note,
5.000% due 02/08/2007 .................. 4,969
10,000 IVAX Corporation, Conv. Sr. Sub. Note,
4.500% due 05/15/2008 .................. 10,125
Omnicare, Inc., Sr. Sub. Note:
11,350 6.125% due 06/01/2013 .................. 10,939
7,000 6.875% due 12/15/2015 .................. 6,956
4,000 Sepracor Inc., Conv. Sub. Deb.,
5.000% due 02/15/2007 .................. 3,990
16,000 Tenet Healthcare Corporation, Sr. Note,
9.250% due 02/01/2015** ................ 16,360
-----------
136,242
-----------
INDEX PRODUCT - 11.5%
24,250 Dow Jones CDX High Yield Series 5 Trust 1,
Pass-through Certificates,
8.750% due 12/29/2010 .................. 25,569
42,000 Dow Jones CDX High Yield Series 6 Trust 1,
Pass-through Certificates,
8.625% due 06/29/2011 .................. 42,420
33,250 TRAINS (Targeted Return Index Securities
Trust), Series HY-2005-1, Grantor Trust,
7.651% due 06/15/2015** ................ 33,636
-----------
101,625
-----------
GAMING - 9.3%
14,500 155E Tropicana Hooters LLC, Sr. Note,
8.750% due 04/01/2012 .................. 14,391
16,500 CCM Merger Inc., Note,
8.000% due 08/01/2013** ................ 16,087
17,500 MGM Grand, Inc., Sr. Note,
6.000% due 10/01/2009 .................. 17,347
19,250 Old Evangeline Downs LLC / Diamond Jo
LLC, Company Guarantee,
8.750% due 04/15/2012 .................. 19,346
14,000 Riviera Holdings Corporation,
Company Guarantee, 11.000% due
06/15/2010 ............................. 14,928
-----------
82,099
-----------
OIL/ENERGY - 6.5%
El Paso Natural Gas Company:
$ 12,500 Bond,
8.375% due 06/15/2032 .................. $ 13,829
2,750 Sr. Note,
7.625% due 08/01/2010 .................. 2,863
Hanover Compressor Company:
2,000 Company Guarantee,
7.500% due 04/15/2010 .................. 2,017
7,950 Conv. Sr. Note,
4.750% due 03/15/2008 .................. 7,761
10,250 Sr. Note,
8.625% due 12/15/2010 .................. 10,737
11,000 Petrobras International Finance Company,
Sr. Note,
9.750% due 07/06/2011 .................. 12,843
7,500 Southern Natural Gas Company, Sr. Note,
8.000% due 03/01/2032 .................. 8,056
-----------
58,106
-----------
LEISURE - 5.8%
23,000 Blockbuster Inc., Sr. Sub. Note,
10.000% due 09/01/2012 ................. 21,850
11,400 Carmike Cinemas, Inc., Sr. Sub. Note,
7.500% due 02/15/2014 .................. 10,944
Royal Caribbean Cruises Ltd.:
3,000 Deb.,
7.250% due 03/15/2018 .................. 3,116
14,000 Sr. Note,
8.750% due 02/02/2011 .................. 15,482
-----------
51,392
-----------
INFORMATION TECHNOLOGY - 5.6%
14,000 BEA Systems Inc., Conv. Sub. Note,
4.000% due 12/15/2006 .................. 13,930
20,500 Conexant Systems Inc., Conv. Sub. Note,
4.000% due 02/01/2007 .................. 20,295
14,500 SS&C Technologies, Inc., Sr. Sub Note,
11.750% due 12/01/2013 ................. 15,660
-----------
49,885
-----------
TELECOMMUNICATIONS - 4.9%
14,250 Extreme Networks, Inc., Conv. Sub. Note,
3.500% due 12/01/2006 .................. 14,250
13,500 Qwest Corporation, Note,
8.875% due 03/15/2012 .................. 14,850
14,710 TriQuint Semiconductor, Inc.,
Conv. Sub. Note,
4.000% due 03/01/2007 .................. 14,489
-----------
43,589
-----------
TRANSPORTATION - 4.6%
AMR Corporation:
5,500 4.500% due 02/15/2024 .................. 7,205
Deb.:
5,000 9.000% due 08/01/2012 .................. 4,838
5,300 9.000% due 09/15/2016 .................. 5,088
58 See Notes to Financial Statements.
Portfolio of Investments (continued)
HIGH YIELD FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CORPORATE BONDS AND NOTES (CONTINUED)
TRANSPORTATION (CONTINUED)
$ 3,600 Continental Airlines, Inc., Conv. Sr. Note,
5.000% due 06/15/2023 .................. $ 5,517
10,000 New Flyer Industries (F), Sub. Note,
14.000% due 08/19/2020 ................. 9,391
8,629 Northwest Airlines, Inc.,
Pass-through Certificates,
Series 1999-2, Class B, (in default),
7.950% due 03/01/2015 .................. 8,591
-----------
40,630
-----------
FOREIGN GOVERNMENT - 3.9%
Federal Republic of Brazil:
5,000 Bond,
9.250% due 10/22/2010 .................. 5,673
6,000 Note,
8.750% due 02/04/2025 .................. 6,795
20,000 Federal Republic of Brazil (F), Bond,
12.500% due 01/05/2016 ................. 9,590
142,634 United Mexican States, Bonds,
8.000% due 12/19/2013 .................. 12,511
-----------
34,569
-----------
AEROSPACE/DEFENSE - 3.5%
18,000 Orbital Sciences Corporation, Sr. Note,
9.000% due 07/15/2011 .................. 19,305
11,000 Primus International Inc., Sr. Note,
11.500% due 04/15/2009** ............... 11,715
-----------
31,020
-----------
CABLE TV - 3.2%
5,650 Adelphia Communications,
Sr. Note, (in default),
10.250% due 06/15/2011 ................. 2,895
8,250 Echostar Communications, Conv. Sub. Note,
5.750% due 05/15/2008 .................. 8,178
9,250 FrontierVision Holdings LP,
Sr. Disc. Note, (in default),
11.875% due 09/15/2007 ................. 10,730
5,000 FrontierVision Operating Partners LP,
Sr. Sub. Note, (in default),
11.000% due 10/15/2006 ................. 6,875
-----------
28,678
-----------
RETAILING - 3.2%
10,000 Neiman Marcus Group Inc.,
Company Guarantee,
10.375% due 10/15/2015** ............... 10,750
16,500 Southern States Cooperative, Inc., Sr. Note,
10.500% due 11/01/2010** ............... 17,573
-----------
28,323
-----------
SERVICES - 2.7%
19,500 Allied Waste North America, Inc., Sr. Note,
7.875% due 04/15/2013 .................. 20,378
4,000 Great Lakes Dredge & Dock Company,
Sr. Sub. Note,
7.750% due 12/15/2013 .................. 3,790
-----------
24,168
-----------
UTILITIES - 4.5%
$ 20,000 Mirant Americas Generation, LLC, Sr. Note,
8.500% due 10/01/2021 .................. $ 20,350
Reliant Energy Inc., Sr. Note:
4,000 6.750% due 12/15/2014 .................. 3,660
16,000 9.500% due 07/15/2013 .................. 16,320
-----------
40,330
-----------
PAPER/CONTAINERS - 1.9%
Jefferson Smurfit Corporation,
Company Guarantee:
11,500 7.500% due 06/01/2013 .................. 10,781
6,425 8.250% due 10/01/2012 .................. 6,265
-----------
17,046
-----------
MEDIA - 1.2%
XM Satellite Radio Holdings Inc., Sr. Note:
5,111 12.000% due 06/15/2010 ................. 5,782
4,717 14.000% due 12/31/2009 ................. 5,077
-----------
10,859
-----------
Total Corporate Bonds and Notes
(Cost $760,317) ........................ 778,561
-----------
U.S. TREASURY NOTE - 1.6%
(Cost $14,571)
15,000 4.500% due 02/15/2016 ..................... 14,351
-----------
SHARES
COMMON STOCKS - 5.5%
280,000 B&G Foods Inc., EIS ....................... 4,191
245,600 Coinmach Service Corporation, IDS ......... 4,158
313,800 Health Care Property Investors, Inc. ...... 8,604
210,000 Health Care REIT, Inc. .................... 7,308
189,757 ICO Global Communications Holdings Ltd.+ .. 1,044
799,900 Nationwide Health Properties, Inc. ........ 17,214
801,400 New Flyer Industries Inc. (F), IDS ........ 6,093
-----------
Total Common Stocks
(Cost $34,976) ......................... 48,612
-----------
CONVERTIBLE PREFERRED STOCK - 2.0%
(Cost $17,055)
329,000 Crown Castle International
Corporation*** ............................ 18,177
-----------
INVESTMENT COMPANY SECURITY - 0.4%
(Cost $3,055)
348,500 Canada Cartage Diversified Income Fund .... 3,469
-----------
WARRANTS - 0.0%
(Cost $12)
46,875 ICO Global Communications Holdings Ltd.,
Expires 05/16/2006+ .................... 0
-----------
See Notes to Financial Statements. 59
Portfolio of Investments (continued)
HIGH YIELD FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
REPURCHASE AGREEMENT - 1.1%
(Cost $9,751)
$ 9,751 Agreement with Credit Suisse First Boston
Corporation, 4.660% dated 04/28/2006,
to be repurchased at $9,755,000 on
05/01/2006 (collateralized by U.S.
Treasury obligations, having various
interest rates and maturities, market
value $9,958,000) ...................... $ 9,751
-----------
TOTAL INVESTMENTS (Cost $839,737*) ....................... 98.3% 872,921
OTHER ASSETS (LIABILITIES) (NET) ......................... 1.7 14,891
----- -----------
NET ASSETS ............................................... 100.0% $ 887,812
===== ===========
- ----------
* Aggregate cost for federal tax purpose.
** Security acquired in a transaction exempt from registration under Rule
144A of the Securities Act of 1933, as amended.
*** Affiliated issuer as defined by the Investment Company Act of 1940 (the
Fund controls 5.0% or more of the outstanding voting shares of the
company). Total cost of such securities is $17,055,000 and the total value
is $18,177,000 or 2.0% of the total net assets of the Fund (See Note 12 to
Financial Statements).
+ Non-income producing security.
++ Defaulted security is past maturity but continues to be valued in recog-
nition of future potential worth.
GLOSSARY OF TERMS
(F) -- Foreign Shares
EIS -- Enhanced Income Security
IDS -- Income Deposit Security
60 See Notes to Financial Statements.
Portfolio of Investments
TAX-EXEMPT BOND FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES - 98.8%
ALABAMA - 0.5%
$ 1,000 Birmingham Baptist Medical Center,
Special Care Facilities Financing
Authority, Health Care Revenue, (Baptist
Health System, Inc.), Series A,
5.000% due 11/15/2030 .................. $ 976
-----------
ALASKA - 4.8%
1,000 Alaska State Housing Finance Corporation,
Housing Revenue, Series A, (FGIC
Insured), 5.250% due 12/01/2041 ........ 1,041
4,500 Alaska State International Airports,
Airport & Marina Revenue, Series B,
(AMBAC Insured), 5.250% due
10/01/2027 ............................. 4,849
1,235 Anchorage, Electric Utilities, Power &
Light Revenue, Sr. Lien, (MBIA Insured),
6.500% due 12/01/2013 .................. 1,430
2,000 Anchorage, Ice Rink, Recreational Revenue,
6.375% due 01/01/2020 .................. 2,186
-----------
9,506
-----------
ARIZONA - 2.3%
2,000 Arizona Tourism & Sports Authority,
Recreational Revenue, (Multipurpose
Stadium Facility Project), Series A,
(MBIA Insured),
5.375% due 07/01/2019 .................. 2,143
1,000 Maricopa County, Hospital Revenue,
(Sun Health Corporation),
5.000% due 04/01/2035 .................. 992
1,500 University Medical Center Corporation,
Hospital Revenue,
5.000% due 07/01/2035 .................. 1,481
-----------
4,616
-----------
CALIFORNIA - 9.2%
1,000 Alameda County, Fremont Unified School
District, GO, Series A, (FGIC Insured),
5.000% due 08/01/2025 .................. 1,033
1,000 California County, Tobacco Securitization
Agency, Tobacco Settlement Asset-Backed
Revenue, (Merced County Tobacco Funding
Corporation), Series A,
5.125% due 06/01/2038 .................. 975
1,000 California Educational Facilities
Authority, College & University Revenue,
(Pepperdine University), Series A,
5.000% due 09/01/2033 .................. 1,027
2,000 California Health Facilities Financing
Authority, Health Care Revenue,
(Cedars-Sinai Medical Center Project),
5.000% due 11/15/2034 .................. 2,014
3,000 California State Department of Water
Resources, Power Supply Revenue, Series
A, (Inverse Floater), (MBIA-IBC
Insured),
6.466% due 05/01/2011+** ............... 3,532
$ 1,000 California Statewide Communities
Development Authority, Health Care
Revenue, (Adventist Health System),
Series A,
5.000% due 03/01/2035 .................. $ 1,003
2,000 Foothill Eastern Transportation Corridor
Agency, Capital Appreciation, Toll Road
Revenue, (MBIA Insured),
Zero coupon due 01/15/2018 ............. 1,100
2,700 Jurupa, Unified School District, GO,
(FGIC Insured),
5.125% due 08/01/2022 .................. 2,842
1,000 Northern California, Tobacco Securitization
Authority, Tobacco Settlement Asset-
Backed Revenue, Series A-1,
5.375% due 06/01/2038 .................. 1,007
2,000 San Francisco City and County,
International Airports Commission,
Airport Revenue, Second Series, Issue
29B, (FGIC Insured),
5.125% due 05/01/2020 .................. 2,090
7,000 San Joaquin Hills, Transportation Corridor
Agency, Toll Road Revenue, Series A,
(MBIA Insured),
Zero coupon due 01/15/2034 ............. 1,767
-----------
18,390
-----------
COLORADO - 1.8%
1,250 Colorado Health Facilities Authority, Lease
Revenue, (Covenant Retirement
Communities, Inc.),
5.000% due 12/01/2035 .................. 1,221
1,650 Lakewood, COP, (AMBAC Insured),
5.350% due 12/01/2017 .................. 1,760
500 Park Creek Metropolitan Dististric,Property
Tax Revenue,
5.500% due 12/01/2030 .................. 512
-----------
3,493
-----------
CONNECTICUT - 0.8%
1,500 Connecticut State Special Obligation
Parking, Airport & Marina Revenue,
(Bradley International Airport), Series
A, AMT, (ACA Insured), 6.600% due
07/01/2024 ............................. 1,637
-----------
DISTRICT OF COLUMBIA - 0.3%
500 District of Columbia, Water & Sewer
Authority, Public Utilities Revenue,
(FSA Insured), 5.500% due 10/01/2017 ... 557
-----------
FLORIDA - 6.4%
500 Bay Laurel Center Community Development
District, Special Assessment Bonds,
(Candler Series Bonds),
5.450% due 05/01/2037*** ............... 500
110 Escambia County, Health Facilities
Authority, Health Facilities Revenue,
(Florida Health Care Facilities
Loan-VHAProgram), (AMBAC Insured),
5.950% due 07/01/2020 .................. 116
See Notes to Financial Statements. 61
Portfolio of Investments (continued)
TAX-EXEMPT BOND FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
FLORIDA (CONTINUED)
$ 650 Escambia County, Utilities Authority,
Utility Systems Revenue, (FGIC Insured),
5.250% due 01/01/2029 .................. $ 674
900 Florida Housing Finance Agency, Housing
Revenue, (Spinnaker Cove Apartments
Project), Series G, AMT, (AMBAC
Insured),
6.500% due 07/01/2036 .................. 920
800 Florida State Board of Education, Lottery
Revenue, Series A, (FGIC Insured),
5.250% due 07/01/2017 .................. 843
1,000 Hillsborough County, Port District Revenue,
(Tampa Port Authority Project),
Series A, AMT, (MBIA Insured),
5.375% due 06/01/2027 .................. 1,049
65 Manatee County, Housing Finance Authority,
SFMR, Series 94-4, AMT,
(GNMA/FNMA Collateral),
6.875% due 11/01/2026 .................. 68
500 Orange County, Housing Finance Authority,
MFHR, (Hands Inc. Project), Series A,
7.000% due 10/01/2025** ................ 535
5,000 Orlando, Utilities Commission, Water &
Electric Revenue,
6.000% due 10/01/2010 .................. 5,456
1,300 Osceola County, School Board, COP,
Series A, (AMBAC Insured),
5.125% due 06/01/2022 .................. 1,360
1,275 UCF Athletics Association, Inc., COP,
(Master Lease Program), Series A,
(FGIC Insured),
5.000% due 10/01/2035 .................. 1,309
-----------
12,830
-----------
GEORGIA - 5.9%
5,000 Georgia State, GO, Series B,
6.300% due 03/01/2009 .................. 5,349
Monroe County, Development Authority, PCR,
(Oglethorpe Power Corporation Project),
Series A, (MBIA-IBC Insured):
2,500 6.700% due 01/01/2009 .................. 2,684
3,410 6.750% due 01/01/2010 .................. 3,750
-----------
11,783
-----------
HAWAII - 1.1%
Honolulu City and County, GO, Series A:
1,270 (Unrefunded Balance),
6.000% due 01/01/2012 .................. 1,402
730 ETM,
6.000% due 01/01/2012 .................. 810
-----------
2,212
-----------
IDAHO - 1.3%
2,000 Idaho Health Facilities Authority, Health
Care Revenue, (IHC Hospitals Inc.
Project), (Inverse Floater), ETM,
6.650% due 02/15/2021+** ............... 2,503
-----------
ILLINOIS - 8.3%
$ 500 Bolingbrook, Capital Appreciation,
Sales Tax Revenue,
Zero coupon due 01/01/2024 ............. $ 455
Chicago, O'Hare International Airport,
Airport Revenue, (Inverse Floater):
1,000 (FGIC Insured),
6.586% due 01/01/2023+** ............... 1,129
1,125 (MBIA Insured),
6.586% due 01/01/2024+** ............... 1,267
5,000 AMT, (FSA Insured),
7.550% due 01/01/2020+** ............... 5,888
965 Chicago, O'Hare International Airport,
Special Facilities Revenue, Series B,
(Second Lien Passenger Facility),
(AMBAC Insured),
5.500% due 01/01/2017 .................. 1,027
500 Illinois Finance Authority, Health Care
Revenue, (Friendship Village
Schaumburg), Series A,
5.625% due 02/15/2037 .................. 505
500 Illinois Finance Authority, Revenue Bonds,
(Landing At Plymouth Place Project),
Series A, 6.000% due 05/15/2025 ........ 517
5,055 Metropolitan Pier & Exposition Authority,
Capital Appreciation, Dedicated State
Tax Revenue, Series A,
(FGIC Insured), ETM,
Zero coupon due 06/15/2009 ............. 4,482
500 United City of Yorkville, Special Service
Area No. 2005-108, Special Tax,
(Autumn Creek Project),
6.000% due 03/01/2036 .................. 498
800 Village of Pingree Grove, Special Service
Area Number One, Special Tax,
(Cambridge Lakes Project), Series 1,
5.250% due 03/01/2015 .................. 805
-----------
16,573
-----------
INDIANA - 3.4%
6,000 Indiana Municipal Power Agency, Power
Supply System Revenue, Series A, ETM,
(MBIA Insured),
6.125% due 01/01/2013 .................. 6,520
230 St. Joseph County, Economic Development
Revenue, (Holy Cross Village at Notre
Dame Project), Series A,
6.000% due 05/15/2026 .................. 240
-----------
6,760
-----------
IOWA - 0.5%
1,000 Tobacco Settlement Authority Iowa, Tobacco
Settlement Asset-Backed Revenue, Series
C, 5.500% due 06/01/2042 ............... 1,009
-----------
LOUISIANA - 2.9%
2,000 Ernest N. Morial, New Orleans Exhibit Hall
Authority, Special Tax, Series A,
(AMBAC Insured),
5.000% due 07/15/2033 .................. 2,021
62 See Notes to Financial Statements.
Portfolio of Investments (continued)
TAX-EXEMPT BOND FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
LOUISIANA (CONTINUED)
$ 2,680 Lafayette, Utility Revenue, (MBIA Insured),
5.250% due 11/01/2023 .................. $ 2,847
1,500 Louisiana Public Facilities Authority,
Customer Receipts Revenue, Series B,
ETM, Zero coupon due 12/01/2019 ........ 800
-----------
5,668
-----------
MARYLAND - 1.9%
2,000 Baltimore, Port Facilities, Industrial
Revenue, (Consolidated Coal Sales
Project), Series B,
6.500% due 10/01/2011 .................. 2,091
1,150 Maryland State Economic Development
Corporation, Student Housing Revenue,
(University of Maryland College Park
Project),
5.625% due 06/01/2035 .................. 1,257
500 Prince Georges County, Special Obligation
Bonds, (National Harbor Project),
5.200% due 07/01/2034 .................. 502
-----------
3,850
-----------
MASSACHUSETTS - 2.6%
2,000 Massachusetts Bay Transportation Authority,
Sales Tax Revenue, Series A,
5.000% due 07/01/2035 .................. 2,048
1,000 Massachusetts State Development Finance
Agency, Revenue Bonds, (Hillcrest
Educational Centers Inc. Project),
6.375% due 07/01/2029 .................. 1,007
1,100 Massachusetts State Health & Educational
Facilities Authority, College &
University Revenue, (UMass Memorial
Issue), Series D,
5.000% due 07/01/2033 .................. 1,091
1,000 Massachusetts State Health & Educational
Facilities Authority, Health Care
Revenue, (Health Care System-Covenant
Health),
6.000% due 07/01/2031 .................. 1,056
-----------
5,202
-----------
MICHIGAN - 1.0%
1,000 Kent Hospital Finance Authority,
Revenue Bonds, (Metropolitan Hospital
Project), Series A,
5.250% due 07/01/2030 .................. 995
1,000 Michigan State Strategic Fund, Limited
Obligation Revenue, (Detroit Edison
Company Exempt Facilities Project),
Series C, AMT, (XLCA Insured),
5.450% due 12/15/2032 .................. 1,048
-----------
2,043
-----------
MINNESOTA - 0.5%
1,000 St. Paul Housing and Redevelopment
Authority, Hospital Facility Revenue,
(HealthEast Project),
6.000% due 11/15/2030 .................. 1,072
-----------
MISSOURI - 1.7%
$ 1,000 Cape Girardeau County, Industrial
Development Authority, Health Care
Facilities Revenue, (Southeast Hospital
Association Project),
5.625% due 06/01/2027 .................. $ 1,024
750 Carthage, Hospital Revenue,
6.000% due 04/01/2038 .................. 749
575 Fenton, Tax Increment Revenue, (Gravois
Bluffs Improvement Project),
7.000% due 10/01/2021 .................. 657
1,000 Missouri State Health and Education
Facilities Authority, Education
Facilities Revenue,
(University of Missouri-Columbia Arena
Project),
5.000% due 11/01/2018 .................. 1,042
-----------
3,472
-----------
MONTANA - 0.5%
1,000 Forsyth, PCR, (NorthWestern Corporation
Colstrip Project),
4.650% due 08/01/2023*** ............... 1,003
-----------
NEBRASKA - 1.1%
2,000 Omaha Public Power District, Electric
Revenue, Series B, ETM,
6.150% due 02/01/2012 .................. 2,179
-----------
NEVADA - 1.1%
1,000 Clark County, Airport Systems Subordinate
Lien Revenue, Series A-2, (FGIC
Insured), 5.000% due 07/01/2036 ........ 1,020
1,000 Reno, Sales & Room Tax Revenue, Sr. Lien,
(ReTrac-Reno Transportation Rail Access
Corridor Project), (AMBAC Insured),
5.125% due 06/01/2037 .................. 1,067
-----------
2,087
-----------
NEW JERSEY - 3.9%
2,000 Bergen County, Improvement Authority,
School Improvement Revenue, (Wyckoff
Township Board of Education Project),
(County Guaranteed),
5.000% due 04/01/2032 .................. 2,076
1,000 New Jersey Economic Development Authority,
Cigarette Tax Revenue,
5.500% due 06/15/2031 .................. 1,037
1,000 New Jersey Economic Development Authority,
Economic Development Revenue,
(Kapkowski Road Landfill Project),
5.750% due 04/01/2031 .................. 1,086
1,340 New Jersey Educational Facilities
Authority, Government Fund Grant
Revenue, (Higher Education Capital
Improvement Project),
Series A, (AMBAC Insured),
5.250% due 09/01/2020 .................. 1,425
2,000 New Jersey State Turnpike Authority, Transit
Revenue, Series C-1, (AMBAC Insured),
5.000% due 01/01/2035 .................. 2,047
-----------
7,671
-----------
See Notes to Financial Statements. 63
Portfolio of Investments (continued)
TAX-EXEMPT BOND FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
NEW YORK - 6.8%
$ 1,265 Metropolitan Transportation Authority,
Service Contract Revenue,
(Transportation Facilities Project),
Series 7,
4.750% due 07/01/2019 .................. $ 1,327
1,500 Metropolitan Transportation Authority,
Transportation Revenue, Series A,
(FGIC Insured),
5.250% due 11/15/2031 .................. 1,580
Nassau County, Tobacco Settlement
Corporation, Tobacco Settlement Asset-
Backed Revenue, Series A-3:
500 5.000% due 06/01/2035 .................. 485
500 5.125% due 06/01/2046 .................. 486
1,000 New York City Industrial Development
Agency, Liberty Revenue Bonds,
(7 World Trade Center, LLC Project),
Series A,
6.250% due 03/01/2015 .................. 1,050
800 New York City Industrial Development
Agency, Special Facilities Revenue,
(American Airlines - JFK International
Airport),
7.625% due 08/01/2025 .................. 877
2,500 New York City Municipal Water Finance
Authority, Water & Sewer Revenue,
(PA 1289 Project), (Inverse Floater),
(MBIA Insured),
6.005% due 06/15/2027+** ............... 2,691
1,000 New York State Dormitory Authority, College
& University Revenue, (State University
Educational Facilities Project),
(MBIA Insured),
6.000% due 05/15/2016 .................. 1,094
1,000 New York State Dormitory Authority, Mount
Sinai NYU Health Revenue,
5.500% due 07/01/2026 .................. 1,011
415 New York State Housing Finance Agency,
MFHR, (Secured Mortgage Program),
Series F, AMT,
6.625% due 08/15/2012 .................. 416
525 New York State Mortgage Agency,
Homeowner Mortgage Revenue,
Series 82, AMT,
5.650% due 04/01/2030 .................. 529
1,000 New York State, GO, Series H,
5.750% due 03/15/2013 .................. 1,081
1,000 TSASC, Inc., Asset-Backed Bonds, Series 1,
5.125% due 06/01/2042 .................. 976
-----------
13,603
-----------
NORTH CAROLINA - 1.6%
1,000 Charlotte, COP, (Convention Facility Project),
Series A,
5.500% due 08/01/2019 .................. 1,076
2,000 North Carolina Municipal Power Agency
No. 1, Catawba Electric Revenue,
Series A, (MBIA Insured),
5.250% due 01/01/2018 .................. 2,118
-----------
3,194
-----------
OHIO - 1.6%
$ 1,000 Adams County, Hospital Facilities
Improvement Revenue, (Adams County
Hospital Project),
6.250% due 09/01/2020 .................. $ 1,006
1,000 Cuyahoga County, Hospital Facilities
Revenue, (Canton Inc. Project),
7.500% due 01/01/2030 .................. 1,102
1,000 Ohio State University, General Receipts
Revenue, Series A,
5.125% due 12/01/2031 .................. 1,032
-----------
3,140
-----------
OKLAHOMA - 0.1%
230 Oklahoma Housing & Finance Authority,
SFMR, Series B, AMT, (GNMA Collateral),
7.997% due 08/01/2018 .................. 243
-----------
OREGON - 2.1%
1,000 Oregon Health Sciences University, College
& University Revenue, Series A,
(MBIA Insured),
5.250% due 07/01/2022 .................. 1,059
2,000 Portland, Sewer System Revenue,
Second Lien, Series A, (FSA Insured),
5.250% due 06/01/2020 .................. 2,122
1,000 Portland, Tax Allocation Revenue,
(Downtown Waterfront Urban Renewal &
Redevelopment Project), Series A,
(AMBAC Insured),
5.750% due 06/15/2016 .................. 1,082
-----------
4,263
-----------
PENNSYLVANIA - 3.6%
Philadelphia, Gas Works Revenue,
(FSA Insured):
2,500 (1998 General Ordinance),
5.250% due 07/01/2029 .................. 2,607
2,405 (Inverse Floater), Series 384,
6.620% due 07/01/2011+** ............... 2,695
820 Philadelphia, Parking Authority, Auto
Parking Revenue, Series A,
(AMBAC Insured),
5.250% due 02/15/2029 .................. 849
1,000 Philadelphia, Redevelopment Authority
Revenue, (Neighborhood Transformation
Project), Series A, (FGIC Insured),
5.500% due 04/15/2017 .................. 1,072
-----------
7,223
-----------
PUERTO RICO - 0.5%
1,000 Puerto Rico Municipal Finance Agency,
Revenue Bonds, Series A, (FSA Insured),
5.250% due 08/01/2021 .................. 1,064
-----------
SOUTH CAROLINA - 0.5%
1,000 South Carolina Jobs-Economic Development
Authority, IDR, (Electric & Gas Company
Project), Series A, (AMBAC Insured),
5.200% due 11/01/2027 .................. 1,053
-----------
64 See Notes to Financial Statements.
Portfolio of Investments (continued)
TAX-EXEMPT BOND FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
SOUTH DAKOTA - 0.7%
$ 1,250 South Dakota Health and Educational
Facilities Authority, Health Care
Revenue, (Sioux Valley Hospitals and
Health System), Series A, 5.250% due
11/01/2034 ............................. $ 1,283
-----------
TENNESSEE - 1.7%
590 Chattanooga, Health, Educational & Housing
Facility Board, College & University
Revenue, (CDFI Phase I, LLC Project),
Series B,
5.500% due 10/01/2020 .................. 591
Johnson City, Health & Educational
Facilities Board, Hospital Revenue,
(Mountain States
Health Care Facilities First Mortgage
Project), Series A:
500 5.500% due 07/01/2036 .................. 518
1,000 7.500% due 07/01/2033 .................. 1,157
500 Shelby County, Health, Educational &
Housing Facilities Board, Health
Facilities Revenue, (Trezevant Manor
Project), Series A,
5.625% due 09/01/2026 .................. 496
625 Tennessee Housing Development Agency,
Housing Revenue, (Homeownership
Program),
Series 2A, AMT,
5.700% due 07/01/2031 .................. 627
-----------
3,389
-----------
TEXAS - 6.4%
500 Alliance Airport Authority, Special
Facilities Revenue, (FedEx Corporation
Project), AMT,
4.850% due 04/01/2021*** ............... 496
1,500 Dallas-Fort Worth International Airport
Board, Airport & Marina Revenue, Series
A, AMT, (FGIC Insured),
5.500% due 11/01/2031 .................. 1,569
2,000 Harris County, Houston Sports Authority,
Special Revenue, Jr. Lien, Series B,
(MBIA Insured), 5.250% due 11/15/2040 .. 2,070
85 Houston, GO, (Public Improvement Project),
(FSA Insured), (Unrefunded Balance),
5.750% due 03/01/2015 .................. 91
1,000 Houston, Hotel Occupancy Tax & Special
Revenue, (Convention & Entertainment
Project), Series B, (AMBAC Insured),
5.750% due 09/01/2015 .................. 1,087
1,000 Lower Colorado River Authority, Transmission
Contract Revenue, (LCRA Transmission
Services Corporation Project), (FGIC
Insured),
5.000% due 05/15/2033 .................. 1,014
1,100 Metro Health Facilities Development
Corporation, Health Care Revenue,
(Wilson N. Jones Memorial Hospital
Project),
7.200% due 01/01/2021 .................. 1,136
North Central, Health Facilities
Development Corporation Revenue:
$ 1,000 (Baylor Health Care System Project),
Series A,
5.125% due 05/15/2029 .................. $ 1,013
1,000 (Children's Medical Center of Dallas
Project), (AMBAC Insured),
5.250% due 08/15/2032 .................. 1,038
1,000 Texas Tech University System, Financing
System Revenue, Seventh Series,
(MBIA Insured),
5.000% due 08/15/2025 .................. 1,059
2,000 University of Texas Financing System,
College & University Revenue, Series A,
5.250% due 08/15/2019 .................. 2,113
-----------
12,686
-----------
VIRGINIA - 0.8%
1,000 Tobacco Settlement Financing Corporation,
Asset-Backed Revenue,
5.625% due 06/01/2037 .................. 1,023
500 Virginia Beach Development Authority,
Residential Care Facility Mortgage
Revenue, (Westminster & Canterbury of
Hampton Roads Inc.),
5.375% due 11/01/2032 .................. 506
-----------
1,529
-----------
WASHINGTON - 6.8%
5,000 Franklin County, Pasco School District
No.1, GO, (FSA Insured),
5.250% due 12/01/2019 .................. 5,307
4,500 King County, Kent School District No. 415,
GO, Series C,
6.300% due 12/01/2008 .................. 4,692
3,000 Washington State, GO, Series B & AT-7,
6.400% due 06/01/2017 .................. 3,494
-----------
13,493
-----------
WEST VIRGINIA - 1.3%
2,500 Harrison County, County Community Solid
Waste Disposal Authority, IDR,
(Monongahela Power Company Project),
Series A, AMT, (MBIA-IBC Insured),
6.875% due 04/15/2022 .................. 2,506
-----------
WISCONSIN - 0.5%
Wisconsin State Health & Educational
Facilities Authority, Health Care Revenue,
Series A:
600 (Beaver Dam Community Hospitals, Inc.
Project),
6.000% due 08/15/2019 .................. 626
380 (Waukesha Memorial Hospital Project),
(AMBAC Insured),
7.125% due 08/15/2007 .................. 381
-----------
1,007
-----------
Total Municipal Bonds and Notes
(Cost $185,964) ........................ 196,768
-----------
See Notes to Financial Statements. 65
Portfolio of Investments (continued)
TAX-EXEMPT BOND FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
CONVERTIBLE BOND - 0.2%
(Cost $317)
$ 317 UAL Corporation, Conv. Bond,
5.000% due 02/01/2021 $ 329
-----------
TOTAL INVESTMENTS++ (Cost $186,281*) 99.0% 197,097
OTHER ASSETS (LIABILITIES) (NET) 1.0 2,042
----- -----------
NET ASSETS 100.0% $ 199,139
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Security deemed illiquid by the Portfolio Manager.
*** Security purchased on a when-issued basis.
+ Variable rate security. The interest rate shown reflects the rate in effect
at April 30, 2006.
++ All securities segregated as collateral for futures contracts or when-
issued securities.
UNREALIZED
NUMBER OF VALUE APPRECIATION
CONTRACTS (000S) (000S)
- --------- ------- ------------
FUTURES CONTRACTS-SHORT POSITION
89 U.S. 5 Year Treasury Note, June 2006 ...... $ 9,270 $77
41 U.S. 10 Year Treasury Note, June 2006 ..... 4,329 11
------- ---
Total Net Unrealized Appreciation
of Futures Contracts ................... $13,599 $88
======= ===
The Tax-Exempt Bond Fund had the following industry concentrations greater than
10.0% at April 30, 2006 (as a percentage of the total net assets of the Fund):
Health Care - Hospital 11.1%
Public Power - Retail Electric 10.9%
The Tax-Exempt Bond Fund had the following insurance concentrations greater than
10.0% at April 30, 2006 (as a percentage of the total net assets of the Fund):
MBIA 20.4%
AMBAC 11.1%
FGIC 10.9%
FSA 10.2%
GLOSSARY OF TERMS
ACA -- ACA Financial Guaranty Corporation
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
COP -- Certificate of Participation
ETM -- Escrowed to Maturity
FGIC -- Federal Guaranty Insurance Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GNMA -- Government National Mortgage Association
GO -- General Obligation
IBC -- Insured Bond Certificate
IDR -- Industrial Development Revenue
BIA -- Municipal Bond Investors Assurance
MFHR -- Multi-family Housing Revenue
PCR -- Pollution Control Revenue
SFMR -- Single Family Mortgage Revenue
VHA -- Veterans Housing Authority
XLCA -- XL Capital Assurance Inc.
66 See Notes to Financial Statements.
Portfolio of Investments
CALIFORNIA MUNICIPAL FUND
April 30, 2006 (Unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES - 99.0%
CALIFORNIA - 98.1%
ABAG Financing Authority for Nonprofit
Corporations, COP:
$ 340 (Episcopal Homes Foundation),
5.000% due 07/01/2007 .................. $ 343
(O'Connor Woods Obligation Group),
(ACA Insured):
700 5.400% due 11/01/2009 .................. 710
2,280 5.700% due 11/01/2013 .................. 2,384
1,240 ABAG Financing Authority for Nonprofit
Corporations, Revenue Bonds,
(California School of Mechanical Arts),
5.250% due 10/01/2026 .................. 1,279
5,360 Alhambra, Improvement Board Act of 1915,
Special Tax Revenue, (Public Works
Assessment District No. 1),
(MBIA Insured),
6.125% due 09/02/2018 .................. 5,561
Amador Water Agency, COP, Series A,
(MBIA Insured):
2,730 5.000% due 06/01/2032 .................. 2,811
3,625 5.000% due 06/01/2036 .................. 3,728
2,000 Anaheim, Public Financing Authority, Tax
Allocation Revenue, (Inverse Floater),
(MBIA Insured),
9.320% due 12/28/2018+ ................. 2,252
2,210 Azusa, Community Facilities District No. 1,
Special Tax Revenue, (Mountain Cove),
Series A,
6.000% due 09/01/2026 .................. 2,311
Baldwin Park, Public Financing Authority,
Lease Revenue, (Community Center
Project),
(AMBAC Insured):
2,635 5.000% due 08/01/2027 .................. 2,713
3,000 5.000% due 08/01/2034 .................. 3,073
Barstow, Redevelopment Agency, Tax
Allocation Revenue, (Central
Redevelopment Project), Series A,
(MBIA Insured):
635 (Unrefunded Balance),
7.000% due 09/01/2014 .................. 716
1,225 ETM,
7.000% due 09/01/2014 .................. 1,401
2,000 Bay Area Government Association, Tax
Allocation Revenue, (California
Redevelopment Agency Pool), Series A,
(XLCA Insured),
5.250% due 09/01/2029 .................. 2,113
2,000 Burbank, Glendale & Pasadena Airport
Authority, Airport Revenue, Series B,
AMT, (AMBAC Insured),
5.000% due 07/01/2025 .................. 2,046
3,155 Burbank, Waste Disposal Revenue, Series B,
(FSA Insured),
5.250% due 05/01/2024 .................. 3,338
California County, Tobacco Securitization
Agency, Tobacco Settlement Asset-Backed
Revenue:
2,000 (Los Angeles County Securitization
Corporation),
Zero coupon due 06/01/2028 ............. 1,553
(Sonoma County Securitization
Corporation):
$ 2,000 5.125% due 06/01/2038 .................. $ 1,951
5,000 5.250% due 06/01/2045 .................. 4,930
2,000 California County, Tobacco Securitization
Agency, Tobacco Settlement Asset-Backed
Revenue, (Merced County Tobacco Funding
Corporation), Series A,
5.125% due 06/01/2038 .................. 1,951
2,000 California Department of Veteran Affairs,
Home Purchase Revenue, Series A,
(AMBAC Insured),
5.400% due 12/01/2018 .................. 2,023
California Educational Facilities
Authority,
College & University Revenue:
5,000 (Pomona College), Series A,
5.000% due 07/01/2045 .................. 5,133
1,000 (Pooled College & University), Series B,
6.625% due 06/01/2020 .................. 1,080
1,000 California Educational Facilities
Authority, Student Loan Revenue,
(California Loan Program), Series A,
AMT, (MBIA Insured),
5.100% due 03/01/2014 .................. 1,029
3,000 California Health Facilities Financing
Authority, Health Care Revenue,
(Cedars-Sinai Medical Center Project),
5.000% due 11/15/2034 .................. 3,021
1,000 California Infrastructure & Economic
Development Bank, Health Care Revenue,
(The J. David Gladstone Institute
Project),
5.500% due 10/01/2015 .................. 1,060
2,500 California Pollution Control Financing
Authority, PCR, (San Diego Gas and
Electric Company), Series A, AMT,
(AMBAC Insured),
5.850% due 06/01/2021 .................. 2,523
California Pollution Control Financing
Authority, Solid Waste Disposal Revenue,
(Waste Management Inc. Project), AMT:
1,500 Series B,
5.000% due 07/01/2027 .................. 1,495
2,500 Series C,
5.125% due 11/01/2023 .................. 2,556
40 California Rural Home Mortgage Finance
Authority, SFMR, (Mortgage-Backed
Securities Program), Issue A, Series 2,
AMT, (GNMA/FHLMC Collateral),
7.950% due 12/01/2024 .................. 40
6,320 California State Department of
Transportation, COP, Series A,
(MBIAInsured),
5.250% due 03/01/2016 .................. 6,517
California State Department of Water
Resources, Power Supply Revenue,
Series A:
5,000 5.750% due 05/01/2017 .................. 5,577
5,500 5.875% due 05/01/2016 .................. 6,170
1,670 California State Department of Water
Resources, Water Revenue, Series W,
(FSA Insured), (Unrefunded Balance),
5.000% due 12/01/2018 .................. 1,748
See Notes to Financial Statements. 67
Portfolio of Investments (continued)
CALIFORNIA MUNICIPAL FUND
April 30, 2006 (Unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
California State Public Works Board, Lease
Revenue:
$ 3,000 (California State University), Series C,
5.400% due 10/01/2022 .................. $ 3,096
1,980 (Department of Corrections - Kern County
at Delano II State Prison), Series C,
5.500% due 06/01/2023 .................. 2,128
1,750 (Department of Corrections Program),
Series A, (MBIA-IBC Insured),
5.000% due 09/01/2018 .................. 1,806
4,330 (Department of Corrections-Ten
Administrative Segregation Housing
Units), Series A, (AMBAC Insured),
5.250% due 03/01/2019 .................. 4,559
(Department of Mental Health - Coalinga
State Hospital), Series A:
3,000 5.000% due 06/01/2024 .................. 3,079
1,750 5.000% due 06/01/2025 .................. 1,794
4,200 (UC M.I.N.D. Institute), Series A,
5.000% due 04/01/2023 .................. 4,280
California State, GO:
5,000 5.000% due 03/01/2026 .................. 5,159
2,000 (CIFG-TCRS Insured),
5.000% due 10/01/2022 .................. 2,061
4,430 (FGIC-TCRS Insured),
5.500% due 06/01/2025 .................. 4,690
1,280 (Veterans), Series BJ, AMT,
5.700% due 12/01/2032 .................. 1,309
1,500 California Statewide Communities
Development Authority, College &
University Revenue, (Thomas Jefferson
School of Law), Series A,
4.875% due 10/01/2035 .................. 1,459
2,600 California Statewide Communities
Development Authority, COP, (Cedars-
Sinai Medical Center), (MBIA-IBC
Insured),
6.500% due 08/01/2012 .................. 2,788
2,000 California Statewide Communities
Development Authority, Health Care
Revenue:
(Adventist Health System), Series A,
5.000% due 03/01/2035 .................. 2,007
1,260 (Daughters of Charity Health System
Project), Series A,
5.000% due 07/01/2039 .................. 1,233
5,085 (Sutter Health), Series A,
5.000% due 11/15/2043 .................. 5,107
California Statewide Communities
Development Authority, MFHR,
(Equity Residential Housing):
1,000 Series B,
5.200% due 12/01/2029 .................. 1,026
3,300 Series C,
5.200% due 06/15/2009 .................. 3,386
1,000 Carson, Redevelopment Agency, Tax
Allocation Revenue, (Area No. 1
Project), (MBIAInsured),
5.500% due 10/01/2016 .................. 1,102
Cathedral City, Improvement Board Act of
1915, Special Tax Revenue, (Cove
Improvement District No. 04-02):
$ 990 5.000% due 09/02/2030 .................. $ 978
1,335 5.050% due 09/02/2035 .................. 1,311
1,000 Chula Vista, Community Facilities District
No. 2001-1, Special Tax Revenue,
(Improvement Area B-San Miguel Ranch
Project),
5.450% due 09/01/2036 .................. 1,019
3,000 Chula Vista, COP, (MBIA Insured),
5.000% due 08/01/2027 .................. 3,091
100 Chula Vista, IDR, (San Diego Gas and
Electric Company), Series A, AMT,
4.900% due 03/01/2023 .................. 101
1,725 Chula Vista, Public Financing Authority,
Special Tax Revenue, (Assessment
Districts Refinancing), Sr. Lien,
Series A, (FSA Insured),
4.700% due 09/02/2014 .................. 1,800
2,610 Chula Vista, Redevelopment Agency, Tax
Allocation Revenue,
8.625% due 09/01/2024 .................. 2,704
2,000 Coachella, Redevelopment Agency, Tax
Allocation Revenue, (Area No. 3
Project),
5.875% due 12/01/2028 .................. 2,061
2,160 Contra Costa County, Public Financing
Authority, Lease Revenue, (Capital
Projects), Series B, (MBIA Insured),
5.250% due 06/01/2027 .................. 2,254
5,000 Contra Costa, Community College District,
GO, (Election of 2002), (MBIA Insured),
5.000% due 08/01/2029 .................. 5,162
Contra Costa, Water District Revenue,
Series K, (FSA Insured):
1,445 5.000% due 10/01/2017 .................. 1,514
1,520 5.000% due 10/01/2018 .................. 1,591
1,665 Davis, Public Facilities Finance Authority
Local Agency, Special Tax Revenue,
(Mace Ranch Area), Series A,
6.600% due 09/01/2025 .................. 1,744
1,215 Fairfield, Housing Authority, Mortgage
Revenue, (Creekside Estates Mobile
Homes),
5.625% due 09/01/2023 .................. 1,248
1,000 Fontana, Redevelopment Agency, Tax
Allocation Revenue, (Southwest
Industrial
Park Project), (MBIA Insured),
5.200% due 09/01/2030 .................. 1,035
Foothill Eastern Transportation Corridor
Agency, Toll Road Revenue:
9,000 Zero coupon due 01/15/2026 ............. 7,829
20,000 Zero coupon due 01/15/2030 ............. 5,035
10,000 Zero coupon due 01/15/2032 ............. 2,225
10,000 Zero coupon due 01/15/2033 ............. 2,096
10,000 Zero coupon due 01/15/2034 ............. 1,970
10,000 Zero coupon due 01/15/2036 ............. 1,738
10,000 Zero coupon due 01/15/2037 ............. 1,637
9,000 Zero coupon due 01/15/2038 ............. 1,386
2,000 Fresno, Joint Powers Financing Authority,
Lease Revenue, Series A, (FSA Insured),
5.750% due 06/01/2026 .................. 2,166
68 See Notes to Financial Statements.
Portfolio of Investments (continued)
CALIFORNIA MUNICIPAL FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
Golden State Tobacco Securitization
Corporation, Tobacco Settlement Asset-
Backed Revenue, Series 2003-A-1:
$ 2,890 6.250% due 06/01/2033 .................. $ 3,135
5,000 6.625% due 06/01/2040 .................. 5,525
1,000 6.750% due 06/01/2039 .................. 1,114
1,000 Hi Desert, Members Health Care District,
Health Care Revenue,
5.500% due 10/01/2015 .................. 1,009
3,000 Highland, Redevelopment Agency, Tax
Allocation Revenue, (Highland
Redevelopment Project Area No. 1),
Series A, (AMBAC Insured),
5.000% due 12/01/2028 .................. 3,090
Huntington Beach, Union High School
District, GO, (Election of 2004),
(FSA Insured):
2,000 5.000% due 08/01/2027 .................. 2,069
5,000 5.000% due 08/01/2029 .................. 5,162
2,000 Huntington Park, Public Financing
Authority, Lease Revenue, (Wastewater
System Project),
6.200% due 10/01/2025 .................. 2,067
5,000 Imperial Irrigation District, COP, (Water
System Projects), (AMBAC Insured),
5.500% due 07/01/2029 .................. 5,362
1,250 Imperial, Water Facilities Revenue, COP,
(FGIC Insured),
5.000% due 10/15/2020 .................. 1,294
Irvine, Improvement Board Act of 1915,
Special Tax Revenue:
1,295 (Assessment District No. 00-18),
Group 5,
5.000% due 09/02/2026 .................. 1,292
1,125 (Assessment District No. 03-19),
Group 3,
5.000% due 09/02/2025 .................. 1,125
990 Irvine, Meadows Mobile Home Park, Mortgage
Revenue, Series A,
5.700% due 03/01/2018 .................. 1,023
Irvine, Public Facilities & Infrastructure
Authority, Assessment Revenue, (AMBAC
Insured):
Series B:
1,455 5.000% due 09/02/2020 .................. 1,504
3,630 5.000% due 09/02/2021 .................. 3,752
2,000 Series C,
5.000% due 09/02/2023 .................. 2,037
2,600 Irvine, Unified School District Financing
Authority, Special Tax Revenue, (Group
II), Series A,
5.000% due 09/01/2026 .................. 2,579
1,825 La Canada, Unified School District, GO,
(Election of 2004), Series A, (MBIA
Insured),
5.500% due 08/01/2028 .................. 1,982
La Quinta, Financing Authority, Local
Agency Revenue, Series A, (AMBAC
Insured):
2,000 5.000% due 09/01/2029 .................. 2,058
1,000 5.250% due 09/01/2024 .................. 1,063
$ 1,500 La Verne, Public Financing Authority,
Revenue Bonds, (Capital Improvement
Projects),
7.250% due 09/01/2026 .................. $ 1,540
1,000 Laguna Hills, COP, (Community Center
Project), (MBIA Insured),
5.000% due 12/01/2017 .................. 1,045
1,840 Lake Elsinore, Public Financing
Authority, Local Agency Revenue,
Series G,
5.800% due 09/02/2015 .................. 1,908
1,000 Loma Linda, Hospital Revenue, (Loma
Linda University Medical Center),
Series A,
5.000% due 12/01/2022 .................. 1,011
1,315 Long Beach, Bond Finance Authority, Tax
Allocation Revenue, (North Long Beach
Redevelopment Projects), Series A,
(AMBAC Insured),
5.000% due 08/01/2022 .................. 1,354
2,000 Long Beach, Community Facilities
District No. 5, Special Tax Revenue,
(Towne Center),
6.875% due 10/01/2025 .................. 2,061
210 Los Angeles, Community Redevelopment
Agency, Housing Revenue, Series C,
(AMBAC Insured),
6.750% due 07/01/2014 .................. 211
2,500 Los Angeles, Community Redevelopment
Agency, Tax Allocation Revenue, (North
Hollywood Project), Series E, (MBIA
Insured),
5.400% due 07/01/2024 .................. 2,652
1,000 Los Angeles, MFHR, (Ridgecroft Apartments
Project), Series E, AMT,
(GNMA Collateral),
6.250% due 09/20/2039 .................. 1,026
1,445 Los Angeles, Special Assessment Revenue,
(Landscaping & Lighting District No.
96-1 Project), (AMBAC Insured),
5.000% due 03/01/2022 .................. 1,486
1,000 Modesto City, Community Facilities District
No. 2004-1, Special Tax Revenue,
(Village One #2),
5.150% due 09/01/2036 .................. 997
Moreno Valley, Unified School District,
COP, (FSA Insured):
1,600 5.000% due 03/01/2025 .................. 1,651
1,760 5.000% due 03/01/2027 .................. 1,810
1,490 Mountain View, Shoreline Regional Park
Community, Tax Allocation Revenue,
Series A, (MBIA Insured),
5.250% due 08/01/2015 .................. 1,590
2,785 Needles, Public Utilities Authority,
Utilities Revenue, (Utilities System
Acquisition Project), Series A,
6.500% due 02/01/2022 .................. 2,886
Northern California, Tobacco Securitization
Authority, Tobacco Settlement Asset-
Backed Revenue, Series A-1:
10,000 5.375% due 06/01/2038 .................. 10,071
9,080 5.500% due 06/01/2045 .................. 9,186
1,100 Oakland, Revenue Bonds, (YMCA East Bay
Project),
7.100% due 06/01/2010 .................. 1,125
See Notes to Financial Statements. 69
Portfolio of Investments (continued)
CALIFORNIA MUNICIPAL FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
$ 1,565 Oakland, Unified School District, GO,
(Alameda County School Improvements),
(FSA Insured),
5.000% due 08/01/2017 .................. $ 1,612
1,485 Oceanside, Community Facilities District
No. 01-1, Special Tax Revenue, (Morro
Hills Development Project), Series A,
5.500% due 09/01/2029 .................. 1,523
1,500 Oceanside, COP, Series A, (AMBAC Insured),
5.250% due 04/01/2018 .................. 1,588
Oxnard, Harbor District, Revenue Bonds:
1,200 Series A, AMT,
5.750% due 08/01/2020 .................. 1,231
1,000 Series B,
6.000% due 08/01/2024 .................. 1,075
1,090 Pacifica, Wastewater Revenue, (AMBAC
Insured),
5.000% due 10/01/2024 .................. 1,130
1,280 Palm Desert, Financing Authority, Tax
Allocation Revenue, (Project Area No.
2), Series A,
(MBIA Insured),
5.000% due 08/01/2022 .................. 1,329
2,805 Perris, Public Financing Authority, 2006
Tax Allocation Revenue,
5.300% due 10/01/2026** ................ 2,811
1,995 Pomona, COP, (Mission Promenade Project),
Series AE, (AMBAC Insured),
5.375% due 10/01/2032 .................. 2,094
5,000 Pomona, Public Financing Authority, Tax
Allocation Revenue, (Merged
Redevelopment Project), Series AD,
(MBIA Insured),
5.000% due 02/01/2021 .................. 5,120
1,000 Pomona, Unified School District, GO, (MBIA
Insured),
6.150% due 08/01/2030 .................. 1,189
5,000 Port of Oakland, Airport & Marina Revenue,
Series K, AMT, (FGIC Insured),
5.750% due 11/01/2029 .................. 5,289
1,000 Poway, Redevelopment Agency, Tax Allocation
Revenue, (Paguay Redevelopment Project),
(AMBAC Insured),
5.375% due 06/15/2019 .................. 1,074
2,750 Redding, Electrical Systems, COP, (Inverse
Floater), (MBIA Insured),
9.359% due 07/01/2022+ ................. 3,704
1,000 Redondo Beach, Public Financing Authority,
Revenue Bonds, (South Bay Center
Redevelopment Project),
7.125% due 07/01/2026 .................. 1,023
1,160 Riverside County, COP, (Capital Improvement
& Family Law Court Refunding Projects),
Series A, (FGIC Insured),
5.000% due 11/01/2025 .................. 1,200
2,100 Riverside County, Public Financing
Authority, COP,
5.800% due 05/15/2029 .................. 2,154
Rocklin, Unified School District, Capital
Appreciation, GO, (FGIC Insured):
$ 1,030 Zero coupon due 08/01/2014 ............. $ 682
1,210 Zero coupon due 08/01/2016 ............. 716
1,255 Zero coupon due 08/01/2017 ............. 703
1,360 Zero coupon due 08/01/2019 ............. 682
1,415 Zero coupon due 08/01/2020 ............. 671
1,225 Zero coupon due 08/01/2023 ............. 494
Saddleback Valley, Unified School District,
GO, (Election of 2004), Series A,
(FSA Insured):
3,000 5.000% due 08/01/2027 .................. 3,103
4,000 5.000% due 08/01/2029 .................. 4,129
Salinas Valley, Solid Waste Authority,
Resource Recovery Revenue, AMT, (AMBAC
Insured):
2,475 5.250% due 08/01/2027 .................. 2,558
2,000 5.250% due 08/01/2031 .................. 2,062
San Diego, Redevelopment Agency, Auto
Parking Revenue:
1,000 (Centre City Redevelopment Project),
Series A,
6.400% due 09/01/2019 .................. 1,054
1,060 (Southcrest Redevelopment Project),
6.500% due 10/01/2025 .................. 1,150
San Francisco City and County,
International Airports Commission,
Airport Revenue, Second Series, AMT,
(MBIA Insured):
4,000 Issue 27A,
5.250% due 05/01/2026 .................. 4,114
4,070 Issue 28A,
5.250% due 05/01/2020 .................. 4,232
1,185 San Francisco City and County,
Redevelopment Agency, Lease Revenue,
(George R. Moscone Convention Center
Project), (XLCA Insured),
Zero coupon due 07/01/2013 ............. 880
9,310 San Jose, Financing Authority, Lease
Revenue, (Convention Center Project),
Series F, (MBIA Insured),
5.000% due 09/01/2018 .................. 9,722
1,000 San Jose, MFHR, (Sixth & Martha Family
Apartments), AMT, (FNMA Collateral),
5.875% due 03/01/2033 .................. 1,032
3,780 San Juan, Unified School District, GO,
(Election of 2002), Series A,
(MBIA Insured),
5.000% due 08/01/2027 .................. 3,910
4,380 Santa Rosa, Mortgage Revenue, (Channate
Lodge), (FHA Insured),
6.700% due 12/01/2024 .................. 4,386
2,000 Semitropic Improvement District of
Semitropic Water Storage District, Water
Banking Revenue, Series A,
(XLCA Insured),
5.125% due 12/01/2035 .................. 2,073
70 See Notes to Financial Statements.
Portfolio of Investments (continued)
CALIFORNIA MUNICIPAL FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- ------------ -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
South Gate, Public Financing Authority,
Tax Allocation Revenue, (South Gate
Redevelopment Project No. 1):
$ 2,090 (AMBAC Insured),
5.250% due 09/01/2022 .................. $ 2,213
1,500 (XLCA Insured),
5.000% due 09/01/2016 .................. 1,578
1,780 Stockton-East, Water District, COP,
(1975 & 1990 Projects), Series A,
(FGIC Insured),
5.250% due 04/01/2022 .................. 1,883
3,270 Temecula, Redevelopment Agency, Tax
Allocation Revenue, (Redevelopment
Project No.1), (MBIA Insured),
5.250% due 08/01/2036 .................. 3,387
1,000 Torrance, Hospital Revenue, (Torrance
Memorial Medical Center), Series A,
6.000% due 06/01/2022 .................. 1,082
1,900 Turlock, COP, (Emanuel Medical Center Inc.
Project), Series A,
5.375% due 10/15/2034 .................. 1,938
1,000 Tustin, Community Facilities District
No. 04-1, Special Tax Revenue, (Tustin
Legacy/John Laing Homes Project),
5.375% due 09/01/2029 .................. 1,017
University of California, College &
University Revenue, (Multipurpose
Projects), Series M,
(FGIC Insured):
2,260 5.125% due 09/01/2017 .................. 2,369
4,635 5.125% due 09/01/2018 .................. 4,851
2,035 Vallejo City, Unified School District, GO,
Series A, (MBIA Insured),
5.900% due 02/01/2021 .................. 2,375
2,305 Walnut, Public Financing Authority, Tax
Allocation Revenue, (Walnut Improvement
Project), (AMBAC Insured),
5.375% due 09/01/2022 .................. 2,455
-----------
393,399
-----------
PUERTO RICO - 0.6%
2,500 Puerto Rico Commonwealth, Children's Trust
Fund, Tobacco Settlement Asset-Backed
Revenue, Series 2002,
5.625% due 05/15/2043 .................. 2,568
-----------
VIRGIN ISLANDS - 0.3%
1,000 Virgin Islands, Public Finance Authority,
Revenue Bonds, (Gross Receipts of Taxes
on Loan Notes), Series A,
6.375% due 10/01/2019 .................. 1,096
-----------
Total Municipal Bonds and Notes
(Cost $383,203) ........................ 397,063
-----------
SHORT-TERM MUNICIPAL BONDS - 0.1%
(Cost $300)
300 California Statewide Communities
Development Authority, COP,
(John Muir/Mt. Diablo
Health Center), (AMBAC Insured),
3.710% due 08/15/2027++ ................ 300
-----------
TOTAL INVESTMENTS+++ (Cost $383,503*) .................... 99.1% $ 397,363
OTHER ASSETS (LIABILITIES) (NET) ......................... 0.9 3,444
----- -----------
NET ASSETS ............................................... 100.0% $ 400,807
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Security purchased on a when-issued basis.
+ Variable rate security. The interest rate shown reflects the rate in effect
at April 30, 2006.
++ Securities with a maturity date of more than 13 months have variable rates
and/or demand features which qualify them as short-term securities.
Securities are secured by bank letters of credit or guarantees by certain
corporations. The interest rates shown are those in effect at April 30,
2006. These rates change periodically based on specified market rates or
indices.
+++ All securities segregated as collateral for futures contracts or when-
issued securities.
UNREALIZED
NUMBER OF VALUE APPRECIATION
CONTRACTS (000S) (000S)
- --------- ------ ------------
FUTURES CONTRACTS-SHORT POSITION
312 U.S. 5 Year Treasury Note, June 2006 ...... $6,666 $2
====== ===
The California Municipal Fund had the following industry concentrations greater
than 10.0% at April 30, 2006 (as a percentage of the total net assets of the
Fund):
Special Tax Revenue-Tax
Allocation/Increment 12.4%
Tobacco-Master Settlement 10.7%
The California Municipal Fund had the following insurance concentrations greater
than 10.0% at April 30, 2006 (as a percentage of the total net assets of the
Fund):
MBIA 21.9%
AMBAC 13.6%
GLOSSARY OF TERMS
ACA -- ACA Financial Guaranty Corporation
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
CIFG -- CDC IXIS Financial Guaranty North America, Inc.
COP -- Certificate of Participation
ETM -- Escrowed to Maturity
FGIC -- Federal Guaranty Insurance Corporation
FHA -- Federal Housing Authority
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GNMA -- Government National Mortgage Association
GO -- General Obligation
IBC -- Insured Bond Certificate
IDR -- Industrial Development Revenue
MBIA -- Municipal Bond Investors Assurance
MFHR -- Multi-family Housing Revenue
PCR -- Pollution Control Revenue
SFMR -- Single Family Mortgage Revenue
TCRS -- Transferable Custodial Receipts
XLCA -- XL Capital Assurance Inc.
See Notes to Financial Statements. 71
Portfolio of Investments
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- --------- ----------
MUNICIPAL BONDS AND NOTES - 96.4%
CALIFORNIA - 94.7%
$ 1,000 ABAG Financing Authority for Nonprofit
Corporations, COP, (Episcopal Homes
Foundation),
6.250% due 08/15/2030 .................. $ 1,037
805 Alameda County, COP, (Santa Rita Jail
Project), (MBIA Insured),
5.375% due 06/01/2009 .................. 822
1,000 Alameda County, Public Financing Authority,
Lease Revenue,
5.000% due 09/02/2008 .................. 1,023
2,000 Anaheim, Public Financing Authority, Lease
Revenue, (Convention Center Project),
Series A, (AMBAC Insured),
5.250% due 08/01/2013 .................. 2,153
Anaheim, Public Financing Authority, Power
& Light Revenue, (Electric System
Generation Project), Series B, (FSA
Insured):
2,000 5.000% due 10/01/2015 .................. 2,098
2,000 5.250% due 10/01/2014 .................. 2,156
1,130 Baldwin Park Public Financing Authority,
Sales Tax & Tax Allocation Revenue,
(Puente Merced Redevelopment Project),
4.625% due 08/01/2016 .................. 1,135
1,000 California Educational Facilities
Authority, Student Loan Revenue,
(California Loan Program), Series A,
AMT, (MBIA Insured),
5.100% due 03/01/2014 .................. 1,029
125 California Health Facilities Financing
Authority, Health Care Revenue,
(AMBAC Insured),
5.875% due 07/01/2009 .................. 128
California Housing Finance Agency, Mortgage
Revenue, Series N, AMT, (AMBAC Insured):
1,000 5.000% due 08/01/2008 .................. 1,024
1,000 5.100% due 02/01/2009 .................. 1,027
1,155 California Infrastructure and Economic
Development Bank, Lease Revenue, Series
A, (FGIC Insured),
5.000% due 08/15/2018 .................. 1,216
California State Department of Water
Resources, Power Supply Revenue, Series
A:
1,675 (MBIA-IBC Insured),
5.250% due 05/01/2015 .................. 1,789
4,000 (XLCA Insured),
5.375% due 05/01/2017 .................. 4,381
3,000 California State Department of Water
Resources, Water System Revenue,
(Central Valley Project), Series Y,
(FGIC Insured),
5.250% due 12/01/2014 .................. 3,235
1,000 California State Economic Recovery, GO,
Series A, (FGIC-TCRS Insured),
5.000% due 07/01/2016 .................. 1,057
California State Public Works Board, Lease
Revenue:
1,000 (California Community Colleges), Series
A, (AMBAC Insured),
5.250% due 12/01/2012 .................. 1,042
$ 2,000 (Department of Corrections Program),
Series A, (AMBAC Insured),
5.250% due 06/01/2012 .................. $ 2,157
1,000 (Department of Corrections-Ten
Administrative Segregation Housing
Units), Series A, (AMBAC Insured),
5.250% due 03/01/2016 .................. 1,069
2,750 (Department of General Services),
(Capitol East End Complex-Blocks 171-174
& 225), Series A, (AMBAC Insured),
5.250% due 12/01/2014 .................. 2,946
California State, GO:
2,000 (FGIC-TCRS Insured),
7.000% due 10/01/2010 .................. 2,267
1,000 (FSA Insured),
5.500% due 03/01/2012 .................. 1,076
2,000 (MBIA-IBC Insured),
6.250% due 09/01/2012 .................. 2,269
1,000 California Statewide Communities
Development Authority, Student Housing
Revenue, (Irvine LLC, UCI East Campus
Apartments, Phase II),
5.000% due 05/15/2020 .................. 1,041
1,845 California Statewide Communities
Development Authority, Water Revenue,
(Pooled Financing Program), Series C,
(FSA Insured),
5.250% due 10/01/2015 .................. 1,979
1,240 Chino Valley, Unified School District, COP,
Series A, (FSA Insured),
5.250% due 09/01/2013 .................. 1,333
645 Chula Vista, Public Financing Authority,
Special Tax Revenue, (Assessment
Districts Refinancing), Sr. Lien, Series
A, (FSA Insured),
4.500% due 09/02/2013 .................. 670
1,325 Cotati-Rohnert Park, Unified School
District, GO, Series B, (FGIC Insured),
5.000% due 08/01/2017 .................. 1,403
Emeryville, Public Financing Authority,
Revenue Bonds, (Emeryville
Redevelopment Project), Series A,
(MBIA Insured):
1,265 5.250% due 09/01/2015 .................. 1,364
1,400 5.250% due 09/01/2017 .................. 1,497
2,000 Golden State Tobacco Securitization
Corporation, Tobacco Settlement Asset-
Backed Revenue, Series A, (AMBAC
Insured),
5.000% due 06/01/2013 .................. 2,134
685 Golden West Schools Financing Authority,
Revenue Bonds, Series A, (MBIA Insured),
5.650% due 02/01/2012 .................. 752
1,615 Inglewood, Unified School District, GO,
(Election of 1998), Series C, (FSA
Insured),
5.250% due 10/01/2017 .................. 1,728
1,195 Kings Canyon, Joint Unified School
District,
GO, (FGIC Insured),
5.375% due 08/01/2015 .................. 1,292
2,000 Loma Linda, Hospital Revenue,
5.000% due 12/01/2017 .................. 2,045
72 See Notes to Financial Statements.
Portfolio of Investments (continued)
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- --------- -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
$ 1,080 Long Beach, Bond Financing Authority,
Lease Revenue, (Public Safety Facilities
Projects), (AMBAC Insured),
5.250% due 11/01/2013 .................. $ 1,165
1,435 Long Beach, Community College District,
GO, Election 2002, Series B, (FGIC
Insured),
5.000% due 05/01/2019 .................. 1,507
3,000 Long Beach, Harbor Department Revenue,
Series B, (FGIC Insured),
5.000% due 05/15/2016 .................. 3,175
2,000 Los Angeles, Department of Water & Power,
Power System Revenue, Series A-1,
(FSA Insured),
5.000% due 07/01/2017 .................. 2,118
1,300 Los Angeles, Department of Water & Power,
Power System Revenue, Series A-2,
(MBIA Insured),
5.000% due 07/01/2017 .................. 1,362
1,045 Los Angeles, Municipal Improvement
Corporation, Lease Revenue, (City of Los
Angeles Central Library Project), Series
AT, (MBIA Insured),
5.500% due 06/01/2017 .................. 1,130
1,500 Los Angeles, State Building Authority,
Lease Revenue, (State of California
Department of
General Services Lease Project), Series
A, (MBIA-IBC Insured),
5.625% due 05/01/2011 .................. 1,596
2,105 M-S-R Public Power Agency, San Juan
Project Revenue, Series I, (MBIA
Insured),
5.000% due 07/01/2015 .................. 2,222
1,500 Merced, Irrigation District, Revenue Bonds,
Warrants,
4.000% due 07/01/2009 .................. 1,498
3,000 Monterey Peninsula, Community College
District, GO, (FGIC Insured),
5.000% due 08/01/2020 .................. 3,148
1,575 Oceanside, COP, Series A, (AMBAC Insured),
5.250% due 04/01/2016 .................. 1,687
Ontario, Redevelopment Financing Authority,
Lease Revenue:
1,055 (Capital Projects), (AMBAC Insured),
5.500% due 08/01/2016 .................. 1,147
1,060 (Project No.1, Center City & Cimarron
Projects), (MBIA Insured),
5.250% due 08/01/2016 .................. 1,137
1,000 Orange County, Public Financing Authority,
Lease Revenue, (Juvenile Justice Center
Facility Project), (AMBAC Insured),
5.375% due 06/01/2016 .................. 1,086
1,000 Orange County, Water District Revenue, COP,
Series B, (MBIA Insured),
5.000% due 08/15/2018 .................. 1,047
795 Palm Desert, Financing Authority, Tax
Allocation Revenue, (Project Area No.
2), Series A, (MBIA Insured),
5.000% due 08/01/2012 .................. 847
$ 1,210 Redding, Joint Powers Financing Authority,
Lease Revenue, (2004 Civic Center
Refunding and Parks Project), Series B,
(AMBAC Insured),
5.000% due 03/01/2015 .................. $ 1,281
1,590 Redlands, COP, (AMBAC Insured),
5.000% due 09/01/2017 .................. 1,659
200 Redondo Beach, Public Financing Authority,
Revenue Bonds, (South Bay Center
Redevelopment Project),
6.750% due 07/01/2006 .................. 201
2,090 Richmond, Joint Powers Financing Authority,
Tax Allocation Revenue, Series A,
(MBIA Insured),
5.500% due 09/01/2017 .................. 2,234
Riverside County, COP, (Historic Courthouse
Refunding Project), Series B,
(FGIC Insured):
1,015 5.000% due 11/01/2018 .................. 1,066
1,105 5.000% due 11/01/2019 .................. 1,156
1,100 Riverside, Special Tax Revenue, (Community
Facilities District No. 90-1-A),
(MBIA Insured),
5.500% due 09/01/2013 .................. 1,190
1,040 Sacramento, Limited Obligation Bonds,
Reassessment District II No. 2006-1,
(Willow Creek II & North Notomas),
5.000% due 09/02/2020** ................ 1,043
1,565 San Bernardino, Redevelopment Agency, Tax
Allocation Revenue, (San Sevaine
Redevelopment Project), Series A,
(Radian Insured),
5.000% due 09/01/2018 .................. 1,627
San Diego County, COP, (Burnham Institute
for Medical Research):
1,000 5.000% due 09/01/2016 .................. 1,025
1,000 5.000% due 09/01/2020 .................. 1,007
1,840 San Diego County, COP, (Motorola Refunding
Project), (AMBAC Insured),
5.000% due 02/01/2011 .................. 1,942
3,000 San Francisco, Bay Area Rapid Transit
District, Sales Tax Revenue, Series A,
(MBIA Insured),
5.000% due 07/01/2018 .................. 3,166
1,200 San Jose, Financing Authority, Lease
Revenue, (Convention Center Project),
Series F,
(MBIA Insured),
5.000% due 09/01/2016 .................. 1,265
Santa Maria, Redevelopment Agency, Lease
Revenue, (Town Center & Westside Parking
Facilities Project), (AMBAC Insured):
165 5.000% due 06/01/2013 .................. 176
1,085 5.250% due 06/01/2015 .................. 1,162
1,160 Shasta, Joint Powers Financing Authority,
Lease Revenue, (County Administration
Building Project), Series A,
(MBIA Insured),
5.250% due 04/01/2017 .................. 1,228
See Notes to Financial Statements. 73
Portfolio of Investments (continued)
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
April 30, 2006 (unaudited)
PRINCIPAL
AMOUNT VALUE
(000S) (000S)
- --------- -----------
MUNICIPAL BONDS AND NOTES (CONTINUED)
CALIFORNIA (CONTINUED)
$ 1,000 South Gate, Public Financing Authority, Tax
Allocation Revenue, (South Gate
Redevelopment Project No. 1),
(XLCA Insured),
5.000% due 09/01/2016 .................. $ 1,052
995 Southern California Home Financing
Authority, MFHR, (The Fountains
Project), Series A, AMT, (FNMA
Collateral),
5.400% due 01/01/2027 .................. 998
1,430 Southern California Public Power Authority,
San Juan Power Revenue, (San Juan Unit 3
Project), Series A, (FSA Insured),
5.000% due 01/01/2020 .................. 1,496
910 Stanton, MFHR, (Continental Gardens LP
Project), AMT, (FNMA Collateral),
5.625% due 08/01/2029 .................. 941
1,305 Stockton, Community Facilities District No.
1, Supplemental Tax Revenue, (Mello
Roos- Weston Ranch), Series A,
5.500% due 09/01/2009 .................. 1,338
Sunnyvale, Solid Waste Revenue,
(AMBAC Insured):
1,000 5.500% due 10/01/2014 .................. 1,076
1,000 5.500% due 10/01/2016 .................. 1,070
1,225 Sweetwater, Union High School District,
COP, (MBIA Insured),
5.000% due 09/01/2020 .................. 1,277
1,000 Tracy, Area Public Facilities Financing
Agency, Special Tax Revenue, (Community
Facilities District No. 87-1-H), (MBIA
Insured),
5.875% due 10/01/2013 .................. 1,043
1,000 Victor Valley, Union High School District,
COP, (Victor Valley Junior High School
Project), (AMBAC Insured),
5.000% due 11/15/2017 .................. 1,056
-----------
115,021
-----------
GUAM - 0.9%
1,000 Guam Government, GO, Series A,
(FSA Insured),
5.500% due 12/01/2011 .................. 1,088
-----------
PUERTO RICO - 0.8%
1,000 Puerto Rico Public Building Authority,
Government Facilities Revenue, Series K,
(MBIA Insured),
4.000% due 07/01/2026 .................. 1,003
-----------
Total Municipal Bonds and Notes
(Cost $116,299) ........................ 117,112
-----------
SHORT-TERM MUNICIPAL BONDS - 2.8%
2,400 Adelanto, Public Utilities Authority, Water
& Sewer Revenue, (Utilities System
Project), Series A, (AMBAC Insured),
3.780% due 11/01/2034+ ................. 2,400
1,000 Madera, Irrigation Financing Authority,
Water Revenue, Series A, (XLCA Insured),
3.780% due 01/01/2036+ ................. 1,000
-----------
Total Short-Term Municipal Bonds
(Cost $3,400) .......................... 3,400
-----------
TOTAL INVESTMENTS++ (Cost $119,699*) ..................... 99.2% $ 120,512
OTHER ASSETS (LIABILITIES) (NET) ......................... 0.8 913
----- -----------
NET ASSETS ............................................... 100.0% $ 121,425
===== ===========
- ----------
* Aggregate cost for federal tax purposes.
** Security purchased on a when-issued basis.
+ Securities with a maturity date of more than 13 months have variable rates
and/or demand features which qualify them as short-term securities.
Securities are secured by bank letters of credit or guarantees by certain
corporations. The interest rates shown are those in effect at April 30,
2006. These rates change periodically based on specified market rates or
indices.
++ All securities segregated as collateral for futures contracts or
when-issued securities.
The California Insured Intermediate Municipal Fund had the following industry
concentrations greater than 10.0% at April 30, 2006 (as a percentage of the
total net assets of the Fund):
Public Facilities-Public Buildings 16.2%
Special Tax Revenue-Tax
Allocation/Increment 11.0%
The California Insured Intermediate Municipal Fund had the following insurance
concentrations greater than 10.0% at April 30, 2006 (as a percentage of the
total net assets of the Fund):
MBIA 25.8%
AMBAC 25.2%
FGIC 16.9%
FSA 13.0%
UNREALIZED
NUMBER OF VALUE APPRECIATION
CONTRACTS (000S) (000S)
- --------- ------- ------------
FUTURES CONTRACTS-SHORT POSITION
98 U.S. 5 Year Treasury Note,
December 2006 .......................... $10,207 $44
======= ===
GLOSSARY OF TERMS
AMBAC -- American Municipal Bond Assurance Corporation
AMT -- Alternative Minimum Tax
COP -- Certificates of Participation
FGIC -- Federal Guaranty Insurance Corporation
FNMA -- Federal National Mortgage Association
FSA -- Financial Security Assurance
GO -- General Obligation
IBC -- Insured Bond Certificate
MBIA -- Municipal Bond Investors Assurance
MFHR -- Multi-family Housing Revenue
Radian -- Radian Asset Assurance Inc.
TCRS -- Transferable Custodial Receipts
XLCA -- XL Capital Assurance
74 See Notes to Financial Statements.
This Page Left Blank Intentionally.
75
Statements of Assets and Liabilities
WM GROUP OF FUNDS
April 30, 2006 (unaudited)
(In thousands)
SMALL
EQUITY GROWTH & WEST COAST MID CAP CAP
REIT INCOME INCOME EQUITY STOCK GROWTH VALUE
FUND FUND FUND FUND FUND FUND FUND
-------- ---------- ---------- ---------- ---------- ---------- --------
ASSETS:
Investments, at cost ................... $356,052 $3,082,440 $1,896,746 $1,502,299 $ 801,799 $2,248,003 $331,381
======== ========== ========== ========== ========== ========== ========
Investments, at value:
Unaffiliated securities ............. $460,397 $3,456,615 $2,334,561 $1,891,445 $ 969,946 $2,378,019 $306,783
Affiliated securities ............... -- -- -- 15,046 -- -- --
Investments held as collateral for
securities loaned ................ 43,913 200,715 150,151 195,406 95,978 129,442 49,923
-------- ---------- ---------- ---------- ---------- ---------- --------
Total Investments ................... 504,310 3,657,330 2,484,712 2,101,897 1,065,924 2,507,461 356,706
Cash ................................... -- 1 -- -- -- 49 36
Unrealized appreciation of forward
foreign currency contracts .......... -- -- -- -- -- -- --
Dividends and/or interest receivable ... 761 6,141 2,626 675 835 1,280 957
Receivable for Fund shares sold ........ 402 17,577 1,847 5,488 2,518 1,489 119
Receivable for investment
securities sold ..................... 1,059 52,082 17,744 419 -- 6,226 4,848
Prepaid expenses ....................... 7 48 39 28 14 33 5
-------- ---------- ---------- ---------- ---------- ---------- --------
Total Assets ........................ 506,539 3,733,179 2,506,968 2,108,507 1,069,291 2,516,538 362,671
-------- ---------- ---------- ---------- ---------- ---------- --------
LIABILITIES:
Payable upon return of securities
loaned .............................. 43,913 200,715 150,151 195,406 95,978 129,442 49,923
Unrealized depreciation of forward
foreign currency contracts .......... -- -- -- -- -- -- --
Payable for Fund shares redeemed ....... 43 2,469 610 1,094 249 554 71
Payable for when-issued securities
purchased ........................... -- -- -- -- -- -- --
Payable for investment securities
purchased ........................... 4,907 58,477 3,303 3,278 4,717 5,340 2,092
Investment advisory fee payable ........ 299 1,415 978 740 574 1,377 217
Shareholder servicing and
distribution fees payable ........... 18 647 184 350 63 106 8
Transfer agent fees payable ............ 6 99 48 70 9 54 3
Variation margin ....................... -- -- -- -- -- -- --
Dividends payable ...................... -- -- -- -- -- -- --
Due to custodian ....................... -- -- -- -- -- -- --
Accrued expenses and other
payables ............................ 56 445 339 404 98 424 23
-------- ---------- ---------- ---------- ---------- ---------- --------
Total Liabilities ................... 49,242 264,267 155,613 201,342 101,688 137,297 52,337
-------- ---------- ---------- ---------- ---------- ---------- --------
NET ASSETS ............................. $457,297 $3,468,912 $2,351,355 $1,907,165 $ 967,603 $2,379,241 $310,334
======== ========== ========== ========== ========== ========== ========
NET ASSETS CONSIST OF:
Undistributed net investment income/
(accumulated net investment loss) ... $ (886) $ 3,276 $ 9,696 $ 1,366 $ 1,680 $ 1,990 $ 1,660
Accumulated net realized gain/(loss)
on investment transactions .......... 28,124 87,408 (37,994) 12,725 29,402 (307,648) 31,068
Net unrealized appreciation/
(depreciation) of investments ....... 148,258 574,890 587,966 599,598 264,125 259,462 25,332
Paid-in capital ........................ 281,801 2,803,338 1,791,687 1,293,476 672,396 2,425,437 252,274
-------- ---------- ---------- ---------- ---------- ---------- --------
Total Net Assets .................... $457,297 $3,468,912 $2,351,355 $1,907,165 $ 967,603 $2,379,241 $310,334
======== ========== ========== ========== ========== ========== ========
76 See Notes to Financial Statements.
CALIFORNIA
SMALL SHORT U.S. TAX- INSURED
CAP INTERNATIONAL TERM GOVERNMENT HIGH EXEMPT CALIFORNIA INTERMEDIATE
GROWTH GROWTH INCOME SECURITIES INCOME YIELD BOND MUNICIPAL MUNICIPAL
FUND FUND FUND FUND FUND FUND FUND FUND FUND
- -------- ------------- -------- ---------- ---------- -------- -------- ---------- ------------
$421,192 $1,095,632 $258,101 $1,827,715 $1,257,604 $839,737 $186,281 $383,503 $119,699
======== ========== ======== ========== ========== ======== ======== ======== ========
$423,695 $1,227,436 $253,444 $1,768,540 $1,239,465 $854,744 $197,097 $397,363 $120,512
-- -- -- -- -- 18,177 -- -- --
82,004 191,138 -- -- -- -- -- -- --
- -------- ---------- -------- ---------- ---------- -------- -------- -------- --------
505,699 1,418,574 253,444 1,768,540 1,239,465 872,921 197,097 397,363 120,512
1 -- 1 1 -- 13,573 945 70 71
-- 556 -- -- -- -- -- -- --
109 5,509 2,835 8,897 16,412 16,989 3,144 5,359 1,583
651 1,169 34 491 535 3,775 772 2,258 1,002
7,593 2,254 -- -- 5,902 20 -- 97 --
6 15 4 28 20 13 3 6 2
- -------- ---------- -------- ---------- ---------- -------- -------- -------- --------
514,059 1,428,077 256,318 1,777,957 1,262,334 907,291 201,961 405,153 123,170
- -------- ---------- -------- ---------- ---------- -------- -------- -------- --------
82,004 191,138 -- -- -- -- -- -- --
-- 551 -- -- -- -- -- -- --
65 120 521 908 1,278 387 358 618 450
-- -- -- -- -- -- 2,000 2,805 1,040
5,114 6,243 -- -- 4,840 17,688 -- -- --
297 1,792 103 729 515 383 82 164 50
34 31 30 113 132 135 60 177 63
20 11 10 19 20 16 6 10 3
-- -- 16 -- -- -- 21 10 15
-- -- 35 169 413 785 245 487 89
-- 467 -- -- 132 -- -- -- --
112 177 29 120 121 85 50 75 35
- -------- ---------- -------- ---------- ---------- -------- -------- -------- --------
87,646 200,530 744 2,058 7,451 19,479 2,822 4,346 1,745
- -------- ---------- -------- ---------- ---------- -------- -------- -------- --------
$426,413 $1,227,547 $255,574 $1,775,899 $1,254,883 $887,812 $199,139 $400,807 $121,425
======== ========== ======== ========== ========== ======== ======== ======== ========
$ (1,099) $ (2,175) $ 164 $ (2,535) $ (557) $ 3,227 $ 217 $ 146 $ 60
(58,121) 12,058 (4,070) (23,924) (13,346) 14,356 272 1,150 20
84,507 323,104 (4,619) (59,175) (18,139) 33,189 10,904 13,862 857
401,126 894,560 264,099 1,861,533 1,286,925 837,040 187,746 385,649 120,488
- -------- ---------- -------- ---------- ---------- -------- -------- -------- --------
$426,413 $1,227,547 $255,574 $1,775,899 $1,254,883 $887,812 $199,139 $400,807 $121,425
======== ========== ======== ========== ========== ======== ======== ======== ========
See Notes to Financial Statements. 77
Statements of Assets and Liabilities (continued)
WM GROUP OF FUNDS
April 30, 2006 (unaudited)
(In thousands)
WEST SMALL
EQUITY GROWTH & COAST MID CAP CAP
REIT INCOME INCOME EQUITY STOCK GROWTH VALUE
FUND FUND FUND FUND FUND FUND FUND
-------- ---------- ---------- -------- -------- ---------- --------
NET ASSETS:
Class A Shares ......................... $ 25,007 $1,270,674 $ 590,185 $865,459 $189,282 $ 143,023 $ 14,117
======== ========== ========== ======== ======== ========== ========
Class B Shares ......................... $ 10,584 $ 293,220 $ 74,592 $190,358 $ 30,251 $ 88,870 $ 3,289
======== ========== ========== ======== ======== ========== ========
Class C Shares ......................... $ 5,763 $ 203,788 $ 2,271 $ 20,164 $ 7,501 $ 2,767 $ 2,592
======== ========== ========== ======== ======== ========== ========
Class I Shares ......................... $415,943 $1,700,951 $1,684,307 $831,184 $740,569 $2,144,581 $290,336
======== ========== ========== ======== ======== ========== ========
Class R-1 Shares ....................... $ -- $ 279 $ -- $ -- $ -- $ -- $ --
======== ========== ========== ======== ======== ========== ========
Class R-2 Shares ....................... $ -- $ -- $ -- $ -- $ -- $ -- $ --
======== ========== ========== ======== ======== ========== ========
SHARES OUTSTANDING:
Class A Shares ......................... 1,312 59,158 22,382 20,396 9,287 8,604 1,152
======== ========== ========== ======== ======== ========== ========
Class B Shares ......................... 557 13,752 2,930 5,043 1,567 6,000 271
======== ========== ========== ======== ======== ========== ========
Class C Shares ......................... 303 9,631 91 532 389 185 213
======== ========== ========== ======== ======== ========== ========
Class I Shares ......................... 21,767 79,175 63,686 19,412 35,897 123,655 23,583
======== ========== ========== ======== ======== ========== ========
Class R-1 Shares ....................... -- 13 -- -- -- -- --
======== ========== ========== ======== ======== ========== ========
Class R-2 Shares ....................... -- -- -- -- -- -- --
======== ========== ========== ======== ======== ========== ========
CLASS A SHARES:**
Net asset value per share of
beneficial interest outstanding* .... $ 19.06 $ 21.48 $ 26.37 $ 42.43 $ 20.38 $ 16.62 $ 12.25
======== ========== ========== ======== ======== ========== ========
Maximum sales charge ................... 5.50% 5.50% 5.50% 5.50% 5.50% 5.50% 5.50%
======== ========== ========== ======== ======== ========== ========
Maximum offering price per share of
beneficial interest outstanding ..... $ 20.17 $ 22.73 $ 27.90 $ 44.90 $ 21.57 $ 17.59 $ 12.96
======== ========== ========== ======== ======== ========== ========
CLASS B SHARES:**
Net asset value and offering price
per share of beneficial interest
outstanding* ........................ $ 19.00 $ 21.32 $ 25.46 $ 37.75 $ 19.31 $ 14.81 $ 12.12
======== ========== ========== ======== ======== ========== ========
CLASS C SHARES:**
Net asset value and offering price
per share of beneficial interest
outstanding* ........................ $ 19.00 $ 21.16 $ 25.07 $ 37.88 $ 19.30 $ 14.96 $ 12.14
======== ========== ========== ======== ======== ========== ========
CLASS I SHARES:**
Net asset value, offering and
redemption price per share of
beneficial interest outstanding ..... $ 19.11 $ 21.48 $ 26.45 $ 42.82 $ 20.63 $ 17.34 $ 12.31
======== ========== ========== ======== ======== ========== ========
CLASS R-1 SHARES:**
Net asset value, offering and
redemption price per share of
beneficial interest outstanding ..... $ 19.04 $ 21.48 $ 26.37 $ 42.43 $ 20.38 $ 16.62 $ 12.25
======== ========== ========== ======== ======== ========== ========
CLASS R-2 SHARES:**
Net asset value, offering and
redemption price per share of
beneficial interest outstanding ..... $ 19.04 $ 21.48 $ 26.37 $ 42.43 $ 20.38 $ 16.62 $ 12.25
======== ========== ========== ======== ======== ========== ========
- ----------
* Redemption price per share is equal to net asset value less any applicable
contingent deferred sales charge and/or applicable redemption fees for the
International Growth Fund.
** Net asset values and maximum offering prices are not shown in thousands.
78 See Notes to Financial Statements.
CALIFORNIA
SMALL SHORT U.S. TAX- INSURED
CAP INTERNATIONAL TERM GOVERNMENT HIGH EXEMPT CALIFORNIA INTERMEDIATE
GROWTH GROWTH INCOME SECURITIES INCOME YIELD BOND MUNICIPAL MUNICIPAL
FUND FUND FUND FUND FUND FUND FUND FUND FUND
- -------- ------------- -------- ---------- -------- -------- -------- ---------- ------------
$120,439 $ 105,830 $ 32,653 $ 106,736 $147,116 $183,966 $169,423 $249,169 $61,597
======== ========== ======== ========== ======== ======== ======== ======== =======
$ 10,030 $ 10,328 $ 19,725 $ 101,354 $111,278 $ 75,410 $ 26,964 $147,670 $52,991
======== ========== ======== ========== ======== ======== ======== ======== =======
$ 1,485 $ 3,972 $ 7,876 $ 7,669 $ 10,730 $ 46,797 $ 2,752 $ 3,968 $ 6,837
======== ========== ======== ========== ======== ======== ======== ======== =======
$294,459 $1,107,417 $195,320 $1,560,140 $985,759 $581,595 $ -- $ -- $ --
======== ========== ======== ========== ======== ======== ======== ======== =======
$ -- $ -- $ -- $ -- $ -- $ 44 $ -- $ -- $ --
======== ========== ======== ========== ======== ======== ======== ======== =======
$ -- $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ --
======== ========== ======== ========== ======== ======== ======== ======== =======
7,520 8,203 14,181 10,285 16,426 21,342 22,448 22,470 5,714
======== ========== ======== ========== ======== ======== ======== ======== =======
723 838 8,566 9,773 12,387 8,707 3,572 13,317 4,915
======== ========== ======== ========== ======== ======== ======== ======== =======
105 327 3,419 740 1,194 5,405 365 358 634
======== ========== ======== ========== ======== ======== ======== ======== =======
17,712 85,389 84,809 150,298 109,845 67,573 -- -- --
======== ========== ======== ========== ======== ======== ======== ======== =======
-- -- -- -- -- 5 -- -- --
======== ========== ======== ========== ======== ======== ======== ======== =======
-- -- -- -- -- -- -- -- --
======== ========== ======== ========== ======== ======== ======== ======== =======
$ 16.02 $ 12.90 $ 2.30 $ 10.38 $ 8.96 $ 8.62 $ 7.55 $ 11.09 $ 10.78
======== ========== ======== ========== ======== ======== ======== ======== =======
5.50% 5.50% 3.50% 4.50% 4.50% 4.50% 4.50% 4.50% 4.50%
======== ========== ======== ========== ======== ======== ======== ======== =======
$ 16.95 $ 13.65 $ 2.38 $ 10.87 $ 9.38 $ 9.03 $ 7.91 $ 11.61 $ 11.29
======== ========== ======== ========== ======== ======== ======== ======== =======
$ 13.88 $ 12.33 $ 2.30 $ 10.37 $ 8.98 $ 8.66 $ 7.55 $ 11.09 $ 10.78
======== ========== ======== ========== ======== ======== ======== ======== =======
$ 14.10 $ 12.16 $ 2.30 $ 10.36 $ 8.98 $ 8.66 $ 7.55 $ 11.09 $ 10.78
======== ========== ======== ========== ======== ======== ======== ======== =======
$ 16.62 $ 12.97 $ 2.30 $ 10.38 $ 8.97 $ 8.61
======== ========== ======== ========== ======== ========
$ 16.01 $ 12.90 $ 2.30 $ 10.38 $ 8.96 $ 8.62
======== ========== ======== ========== ======== ========
$ 16.01 $ 12.90 $ 2.30 $ 10.38 $ 8.96 $ 8.62
======== ========== ======== ========== ======== ========
See Notes to Financial Statements. 79
Statements of Operations
WM GROUP OF FUNDS
For the Six Months Ended April 30, 2006 (unaudited)
(In thousands)
WEST SMALL
EQUITY GROWTH & COAST MID CAP CAP
REIT INCOME INCOME EQUITY STOCK GROWTH VALUE
FUND FUND FUND FUND FUND FUND FUND
------- -------- -------- -------- -------- ------- -------
INVESTMENT INCOME:
Dividends .............................. $ 4,884 $ 31,899 $ 25,714 $ 10,889 $ 6,412 $ 9,955 $ 4,043
Interest ............................... 526 5,472 1,151 1,225 1,089 1,644 263
Foreign withholding taxes .............. (38) (226) (34) -- (32) (139) (251)
Securities lending income .............. 44 436 53 182 66 85 206
------- -------- -------- -------- -------- ------- -------
Total investment income .......... 5,416 37,581 26,884 12,296 7,535 11,545 4,261
------- -------- -------- -------- -------- ------- -------
EXPENSES:
Investment advisory fee ................ 1,769 7,651 6,307 4,216 3,327 7,559 1,368
Custodian fees ......................... 6 32 40 35 12 80 14
Legal and audit fees ................... 19 41 39 30 24 33 19
Registration and filing fees ........... 26 82 22 49 31 82 27
Printing and postage expenses .......... 68 297 114 259 56 87 10
Other .................................. 18 188 125 135 36 110 12
Shareholder servicing and distribution
fees:
Class A Shares ...................... 27 1,319 728 1,005 145 167 18
Class B Shares ...................... 49 1,289 396 907 135 475 16
Class C Shares ...................... 27 830 10 85 29 12 13
Class R-1 Shares .................... -- -- -- -- -- -- --
Class R-2 Shares .................... -- -- -- -- -- -- --
Transfer agent fees:
Class A Shares ...................... 21 390 223 307 40 184 14
Class B Shares ...................... 12 236 135 220 36 230 6
Class C Shares ...................... 4 78 3 13 4 3 2
Recordkeeping/administration fees:
Class R-1 Shares .................... -- -- -- -- -- -- --
Class R-2 Shares .................... -- -- -- -- -- -- --
------- -------- -------- -------- -------- ------- -------
Total expenses ................... 2,046 12,433 8,142 7,261 3,875 9,022 1,519
Fees reduced by custodian credits ...... (1) (5) (1) (1) (1) (15) (1)
------- -------- -------- -------- -------- ------- -------
Net expenses ..................... 2,045 12,428 8,141 7,260 3,874 9,007 1,518
------- -------- -------- -------- -------- ------- -------
NET INVESTMENT INCOME/(LOSS) ........... 3,371 25,153 18,743 5,036 3,661 2,538 2,743
------- -------- -------- -------- -------- ------- -------
NET REALIZED AND UNREALIZED
GAIN/(LOSS) ON INVESTMENTS:
Net realized gain/(loss) on:
Unaffiliated security transactions .. 24,809 86,502 14,891 13,565 32,574 12,346 30,285
Affiliated secuity transactions ..... -- -- -- (149) -- -- --
Forward foreign currency contracts
and foreign currency
transactions ..................... -- -- -- -- -- (110) (63)
Futures contracts ................... -- -- -- -- -- -- --
------- -------- -------- -------- -------- ------- -------
Net realized gain/(loss) on
investment transactions ....... 24,809 86,502 14,891 13,416 32,574 12,236 30,222
------- -------- -------- -------- -------- ------- -------
Capital gain distributions received .... 3,324 1,019 -- 382 -- -- 30
------- -------- -------- -------- -------- ------- -------
Net change in unrealized appreciation/
depreciation of:
Securities .......................... 28,935 206,954 171,903 168,769 85,611 82,006 3,755
Forward foreign currency contracts .. -- -- -- -- -- 14 11
Foreign currency, futures contracts
and other assets and
liabilities ...................... -- -- -- -- -- (4) --
------- -------- -------- -------- -------- ------- -------
Net change in unrealized appreciation/
depreciation of investment
transactions ........................ 28,935 206,954 171,903 168,769 85,611 82,016 3,766
------- -------- -------- -------- -------- ------- -------
Net realized and unrealized
gain/(loss) on investments .......... 57,068 294,475 186,794 182,567 118,185 94,252 34,018
------- -------- -------- -------- -------- ------- -------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ..................... $60,439 $319,628 $205,537 $187,603 $121,846 $96,790 $36,761
======= ======== ======== ======== ======== ======= =======
- ----------
* Amount represents less than $500.
80 See Notes to Financial Statements.
CALIFORNIA
U.S. INSURED
SMALL CAP INTERNATIONAL SHORT TERM GOVERNMENT HIGH TAX-EXEMPT CALIFORNIA INTERMEDIATE
GROWTH GROWTH INCOME SECURITIES INCOME YIELD BOND MUNICIPAL MUNICIPAL
FUND FUND FUND FUND FUND FUND FUND FUND FUND
- --------- ------------- ---------- ---------- -------- ------- ---------- ---------- ------------
$ 227 $ 9,796 $ -- $ -- $ -- $ 932 $ -- $ -- $ --
325 753 6,006 46,031 37,687 33,055 5,220 10,255 2,622
-- (774) -- -- -- (51) -- -- --
431 301 -- -- -- -- -- -- --
------- -------- ------- -------- -------- ------- ------- ------- ------
983 10,076 6,006 46,031 37,687 33,936 5,220 10,255 2,622
------- -------- ------- -------- -------- ------- ------- ------- ------
1,617 4,127 632 4,512 3,058 2,245 504 999 315
23 327 4 34 11 73 5 5 4
20 25 18 32 26 24 17 19 17
28 49 24 25 35 33 21 13 12
45 40 12 45 44 43 10 47 14
34 31 16 71 60 40 15 24 9
121 91 41 142 183 186 214 301 78
50 35 108 556 595 369 142 773 283
6 11 50 36 53 208 12 21 36
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
110 49 26 74 83 61 35 40 8
30 15 17 65 64 34 7 27 11
1 2 6 3 7 16 1 1 1
-- -- -- -- -- -- -- -- --
-- -- -- -- -- -- -- -- --
------- -------- ------- -------- -------- ------- ------- ------- ------
2,085 4,802 954 5,595 4,219 3,332 983 2,270 788
(3) (2) --* --* (10) (65) (4) (2) (2)
------- -------- ------- -------- -------- ------- ------- ------- ------
2,082 4,800 954 5,595 4,209 3,267 979 2,268 786
------- -------- ------- -------- -------- ------- ------- ------- ------
(1,099) 5,276 5,052 40,436 33,478 30,669 4,241 7,987 1,836
------- -------- ------- -------- -------- ------- ------- ------- ------
7,972 31,669 (238) (738) 3,511 46,148 333 1,283 (77)
-- -- -- -- -- -- -- -- --
-- (176) -- -- -- 24 -- -- --
-- -- 269 -- -- -- 304 (152) 115
------- -------- ------- -------- -------- ------- ------- ------- ------
7,972 31,493 31 (738) 3,511 46,172 637 1,131 38
------- -------- ------- -------- -------- ------- ------- ------- ------
4 -- -- -- -- 20 -- -- --
------- -------- ------- -------- -------- ------- ------- ------- ------
45,292 162,567 (1,222) (22,227) (16,260) (9,936) (596) (1,305) (545)
-- (38) -- -- -- -- -- -- --
-- 203 (128) -- -- 26 (190) (61) 26
------- -------- ------- -------- -------- ------- ------- ------- ------
45,292 162,732 (1,350) (22,227) (16,260) (9,910) (786) (1,366) (519)
------- -------- ------- -------- -------- ------- ------- ------- ------
53,268 194,225 (1,319) (22,965) (12,749) 36,282 (149) (235) (481)
------- -------- ------- -------- -------- ------- ------- ------- ------
$52,169 $199,501 $ 3,733 $ 17,471 $ 20,729 $66,951 $ 4,092 $ 7,752 $1,355
======= ======== ======= ======== ======== ======= ======= ======= ======
See Notes to Financial Statements. 81
Statements of Changes in Net Assets
WM GROUP OF FUNDS
(In thousands)
REIT FUND EQUITY INCOME FUND GROWTH & INCOME FUND
----------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
4/30/06 YEAR ENDED 4/30/06 YEAR ENDED 4/30/06 YEAR ENDED
(UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05
----------- ---------- ----------- ---------- ----------- ----------
Net investment income .................. $ 3,371 $ 11,284 $ 25,153 $ 44,832 $ 18,743 $ 37,167
Net realized gain on
investment transactions ............. 24,809 7,623 86,502 86,726 14,891 45,639
Capital gain distributions received .... 3,324 2,695 1,019 1,209 -- --
Net change in unrealized appreciation/
depreciation of investments ......... 28,935 34,474 206,954 125,418 171,903 53,674
-------- -------- ---------- ---------- ---------- ----------
Net increase in net assets
resulting from operations ........... 60,439 56,076 319,628 258,185 205,537 136,480
Distributions to shareholders from:
Net investment income:
Class A Shares ................... (243) (345) (9,112) (12,793) (6,969) (6,506)
Class B Shares ................... (75) (127) (1,167) (2,100) (92) (25)
Class C Shares ................... (44) (79) (894) (978) (9) (4)
Class I Shares ................... (5,532) (10,165) (15,656) (25,533) (28,013) (21,264)
Class R-1 Shares ................. -- -- -- -- -- --
Class R-2 Shares ................. -- -- -- -- -- --
Net realized gains on investments:
Class A Shares ................... (443) (240) (29,129) -- -- --
Class B Shares ................... (212) (144) (7,506) -- -- --
Class C Shares ................... (120) (86) (4,471) -- -- --
Class I Shares ................... (9,098) (7,193) (41,428) -- -- --
Class R-1 Shares ................. -- -- -- -- -- --
Class R-2 Shares ................. -- -- -- -- -- --
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................... 4,680 7,655 308,560 383,168 (21,711) (41,061)
Class B Shares ................... 720 2,109 49,014 62,131 (12,305) (19,614)
Class C Shares ................... 124 1,002 63,788 88,699 297 218
Class I Shares ................... (14,045) 36,671 299,467 261,151 (404,030) 495,612
Class R-1 Shares ................. -- -- 273 -- -- --
Class R-2 Shares ................. -- -- -- -- -- --
-------- -------- ---------- ---------- ---------- ----------
Net increase/(decrease) in net assets .. 36,151 85,134 931,367 1,011,930 (267,295) 543,836
NET ASSETS:
Beginning of period/year ............... 421,146 336,012 2,537,545 1,525,615 2,618,650 2,074,814
-------- -------- ---------- ---------- ---------- ----------
End of period/year ..................... $457,297 $421,146 $3,468,912 $2,537,545 $2,351,355 $2,618,650
======== ======== ========== ========== ========== ==========
Undistributed net investment income/
(accumulated net investment loss)
at end of period/year ............... $ (886) $ 1,637 $ 3,276 $ 4,952 $ 9,696 $ 26,036
======== ======== ========== ========== ========== ==========
82 See Notes to Financial Statements.
WEST COAST EQUITY FUND MID CAP STOCK FUND GROWTH FUND SMALL CAP VALUE FUND
- ----------------------- ----------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED ENDED
4/30/06 YEAR ENDED 4/30/06 YEAR ENDED 4/30/06 YEAR ENDED 4/30/06 YEAR ENDED
(UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05
- ----------- ---------- ----------- ---------- ----------- ---------- ----------- ----------
$ 5,036 $ 10,166 $ 3,661 $ 12,829 $ 2,538 $ 8,416 $ 2,743 $ 2,892
13,416 37,872 32,574 56,510 12,236 66,759 30,222 18,587
382 1,036 -- 2 -- -- 30 1
168,769 124,947 85,611 55,365 82,016 82,424 3,766 2,884
- ---------- ---------- -------- -------- ---------- ---------- -------- --------
187,603 174,021 121,846 124,706 96,790 157,599 36,761 24,364
(2,474) (3,556) (1,417) (100) -- (460) (89) (55)
-- -- (150) -- -- (280) -- (6)
-- (3) (52) -- -- (7) (6) (2)
(4,379) (4,933) (11,820) (2,895) (2,024) (6,132) (2,800) (2,805)
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
(18,344) (7,696) (6,174) (2,119) -- -- (768) --
(4,676) (1,922) (1,651) (732) -- -- (171) --
(403) (126) (307) (69) -- -- (138) --
(15,468) (6,454) (48,230) (21,862) -- -- (17,591) --
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
64,027 41,184 88,426 25,110 8,571 (8,352) (894) 11,566
8,574 10,799 4,347 1,870 (11,927) (23,335) 177 2,358
5,280 3,521 2,823 2,289 501 (6) 54 2,082
149,251 45,817 (68,437) 64,931 554,950 93,923 (43,503) 29,467
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
- ---------- ---------- -------- -------- ---------- ---------- -------- --------
368,991 250,652 79,204 191,129 646,861 212,950 (28,968) 66,969
1,538,174 1,287,522 888,399 697,270 1,732,380 1,519,430 339,302 272,333
- ---------- ---------- -------- -------- ---------- ---------- -------- --------
$1,907,165 $1,538,174 $967,603 $888,399 $2,379,241 $1,732,380 $310,334 $339,302
========== ========== ======== ======== ========== ========== ======== ========
$ 1,366 $ 3,183 $ 1,680 $ 11,458 $ 1,990 $ 1,476 $ 1,660 $ 1,812
========== ========== ======== ======== ========== ========== ======== ========
See Notes to Financial Statements. 83
Statements of Changes in Net Assets (continued)
WM GROUP OF FUNDS
(In thousands)
SMALL CAP INTERNATIONAL SHORT TERM
GROWTH FUND GROWTH FUND INCOME FUND
----------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
4/30/06 YEAR ENDED 4/30/06 YEAR ENDED 4/30/06 YEAR ENDED
(UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05
----------- ---------- ----------- ---------- ----------- ----------
Net investment income/(loss) ........... $ (1,099) $ (2,251) $ 5,276 $ 10,174 $ 5,052 $ 9,220
Net realized gain/(loss) on investment
transactions ........................ 7,972 (47,989) 31,493 18,824 31 643
Capital gain distributions received .... 4 1 -- -- -- --
Net increase from payment by the
Advisor ............................. -- 1,321 -- -- -- --
Net change in unrealized appreciation/
depreciation of investments ......... 45,292 73,015 162,732 87,039 (1,350) (7,518)
-------- -------- ---------- -------- -------- --------
Net increase in net assets resulting
from operations ..................... 52,169 24,097 199,501 116,037 3,733 2,345
Distributions to shareholders from:
Net investment income:
Class A Shares ................... -- -- (881) (364) (594) (1,541)
Class B Shares ................... -- -- (33) -- (309) (742)
Class C Shares ................... -- -- (19) (4) (147) (453)
Class I Shares ................... -- -- (14,503) (7,523) (3,893) (6,799)
Class R-1 Shares ................. -- -- -- -- -- --
Class R-2 Shares ................. -- -- -- -- -- --
Net realized gains on investments:
Class A Shares ................... -- -- -- -- -- --
Class B Shares ................... -- -- -- -- -- --
Class C Shares ................... -- -- -- -- -- --
Class I Shares ................... -- -- -- -- -- --
Class R-1 Shares ................. -- -- -- -- -- --
Class R-2 Shares ................. -- -- -- -- -- --
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................... 20,498 (12,015) 36,786 9,765 (3,485) (16,583)
Class B Shares ................... (1,185) (2,939) 4,247 579 (3,791) (7,458)
Class C Shares ................... 376 42 2,410 634 (5,563) (5,044)
Class I Shares ................... 17,182 (15,365) 157,891 140,594 635 31,452
Class R-1 Shares ................. -- -- -- -- -- --
Class R-2 Shares ................. -- -- -- -- -- --
Redemption fees .................. -- -- 10 10 -- --
-------- -------- ---------- -------- -------- --------
Net increase/(decrease) in net assets .. 89,040 (6,180) 385,409 259,728 (13,414) (4,823)
NET ASSETS:
Beginning of period/year ............... 337,373 343,553 842,138 582,410 268,988 273,811
-------- -------- ---------- -------- -------- --------
End of period/year ..................... $426,413 $337,373 $1,227,547 $842,138 $255,574 $268,988
======== ======== ========== ======== ======== ========
Undistributed net investment income/
(accumulated net investment loss) at
end of period/year .................. $ (1,099) $ -- $ (2,175) $ 7,985 $ 164 $ 55
======== ======== ========== ======== ======== ========
84 See Notes to Financial Statements.
U.S. GOVERNMENT
SECURITIES FUND INCOME FUND HIGH YIELD FUND TAX-EXEMPT BOND FUND
- ----------------------- ----------------------- ----------------------- -----------------------
SIX MONTHS SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED ENDED
4/30/06 YEAR ENDED 4/30/06 YEAR ENDED 4/30/06 YEAR ENDED 4/30/06 YEAR ENDED
(UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05
- ----------- ---------- ----------- ---------- ----------- ---------- ----------- ----------
$ 40,436 $ 70,544 $ 33,478 $ 59,461 $ 30,669 $ 53,962 $ 4,241 $ 8,898
(738) 2,784 3,511 1,785 46,172 9,623 637 3,616
-- -- -- -- 20 -- -- --
-- -- -- -- -- -- -- --
(22,227) (52,278) (16,260) (50,548) (9,910) (13,197) (786) (8,065)
- ---------- ---------- ---------- ---------- -------- -------- -------- --------
17,471 21,050 20,729 10,698 66,951 50,388 4,092 4,449
(2,581) (5,482) (3,931) (7,648) (4,913) (7,174) (3,686) (7,693)
(2,120) (4,948) (2,760) (6,248) (2,180) (4,795) (505) (1,151)
(138) (222) (244) (504) (1,229) (2,317) (43) (95)
(38,715) (67,624) (27,177) (49,194) (19,988) (41,288) -- --
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
-- -- -- -- -- -- (3,337) (2,041)
-- -- -- -- -- -- (566) (392)
-- -- -- -- -- -- (50) (40)
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
(12,250) (10,238) 1,126 6,391 66,044 26,776 (2,259) (3,754)
(19,249) (31,325) (15,635) (17,900) (1,679) (5,927) (2,532) (4,309)
1,006 700 83 (310) 6,416 5,421 446 (1,180)
(59,679) 431,064 92,428 108,913 (33,369) 65,992 -- --
-- -- -- -- 44 -- -- --
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
- ---------- ---------- ---------- ---------- -------- -------- -------- --------
(116,255) 332,975 64,619 44,198 76,097 87,076 (8,440) (16,206)
1,892,154 1,559,179 1,190,264 1,146,066 811,715 724,639 207,579 223,785
- ---------- ---------- ---------- ---------- -------- -------- -------- --------
$1,775,899 $1,892,154 $1,254,883 $1,190,264 $887,812 $811,715 $199,139 $207,579
========== ========== ========== ========== ======== ======== ======== ========
$ (2,535) $ 583 $ (557) $ 77 $ 3,227 $ 868 $ 217 $ 210
========== ========== ========== ========== ======== ======== ======== ========
See Notes to Financial Statements. 85
Statements of Changes in Net Assets (continued)
WM GROUP OF FUNDS
(In thousands)
CALIFORNIA INSURED
CALIFORNIA INTERMEDIATE
MUNICIPAL FUND MUNICIPAL FUND
----------------------- -----------------------
SIX MONTHS SIX MONTHS
ENDED ENDED
4/30/06 YEAR ENDED 4/30/06 YEAR ENDED
(UNAUDITED) 10/31/05 (UNAUDITED) 10/31/05
----------- ---------- ----------- ----------
Net investment income .................. $ 7,987 $ 16,236 $ 1,836 $ 3,813
Net realized gain on
investment transactions ............. 1,131 5,076 38 282
Net change in unrealized depreciation of
investments ......................... (1,366) (10,599) (519) (3,874)
-------- -------- -------- --------
Net increase in net assets resulting
from operations ..................... 7,752 10,713 1,355 221
Distributions to shareholders from:
Net investment income:
Class A Shares ................... (5,161) (9,845) (1,028) (2,071)
Class B Shares ................... (2,739) (6,202) (716) (1,549)
Class C Shares ................... (75) (168) (92) (194)
Net realized gains on investments:
Class A Shares ................... (3,051) (601) (152) (29)
Class B Shares ................... (2,036) (503) (133) (30)
Class C Shares ................... (57) (14) (17) (3)
Net increase/(decrease) in net assets
from Fund share transactions:
Class A Shares ................... 10,554 13,478 (3,681) 1,650
Class B Shares ................... (12,816) (30,692) (6,222) (10,250)
Class C Shares ................... (618) (556) (594) (1,077)
-------- -------- -------- --------
Net decrease in net assets ............. (8,247) (24,390) (11,280) (13,332)
NET ASSETS:
Beginning of period/year ............... 409,054 433,444 132,705 146,037
-------- -------- -------- --------
End of period/year ..................... $400,807 $409,054 $121,425 $132,705
======== ======== ======== ========
Undistributed net investment income
at end of period/year ............... $ 146 $ 134 $ 60 $ 60
======== ======== ======== ========
86 See Notes to Financial Statements.
Statements of Changes in Net Assets -- Capital Stock Activity
WM GROUP OF FUNDS
(In thousands)
REIT FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- ---------------- ------------------ -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------- ------ --------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 7,220 390 $ 597 34 $ (3,137) (170) $ 4,680 254
Class B ......... 1,816 98 239 14 (1,335) (73) 720 39
Class C ......... 653 36 150 8 (679) (38) 124 6
Class I ......... 2,393 128 14,630 823 (31,068) (1,705) (14,045) (754)
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $12,754 768 $ 508 31 $ (5,607) (341) $ 7,655 458
Class B ......... 4,183 255 224 14 (2,298) (140) 2,109 129
Class C ......... 2,480 150 150 9 (1,628) (98) 1,002 61
Class I ......... 21,378 1,337 17,358 1,056 (2,065) (125) 36,671 2,268
EQUITY INCOME FUND
ISSUED AS
REINVESTMENT
SOLD OF DIVIDENDS REDEEMED NET INCREASE
----------------- ---------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
-------- ------ ------- ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $366,737 17,689 $32,878 1,617 $(91,055) (4,393) $308,560 14,913
Class B ......... 64,816 3,153 7,162 356 (22,964) (1,117) 49,014 2,392
Class C ......... 69,583 3,416 4,240 212 (10,035) (492) 63,788 3,136
Class I ......... 246,002 12,021 57,084 2,805 (3,619) (170) 299,467 14,656
Class R-1 ....... 329 16 -- -- (56) (3) 273 13
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $467,759 23,884 $11,158 573 $(95,749) (4,876) $383,168 19,581
Class B ......... 94,639 4,886 1,809 94 (34,317) (1,776) 62,131 3,204
Class C ......... 96,461 4,973 766 40 (8,528) (440) 88,699 4,573
Class I ......... 237,093 12,184 25,533 1,313 (1,475) (81) 261,151 13,416
GROWTH & INCOME FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
----------------- ---------------- ------------------- -------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
-------- ------ ------- ------ --------- ------- --------- -------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 22,086 856 $ 6,713 264 $ (50,510) (1,964) $ (21,711) (844)
Class B ......... 2,197 88 88 4 (14,590) (585) (12,305) (493)
Class C ......... 579 24 9 -- (291) (12) 297 12
Class I ......... 22,912 883 28,013 1,101 (454,955) (17,648) (404,030) (15,664)
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $ 39,189 1,595 $ 6,275 253 $ (86,525) (3,517) $ (41,061) (1,669)
Class B ......... 5,243 220 24 1 (24,881) (1,049) (19,614) (828)
Class C ......... 729 32 4 -- (515) (22) 218 10
Class I ......... 474,848 19,204 21,264 856 (500) (20) 495,612 20,040
See Notes to Financial Statements. 87
Statements of Changes in Net Assets -- Capital Stock Activity (continued)
WM GROUP OF FUNDS
(In thousands)
WEST COAST EQUITY FUND
ISSUED AS
REINVESTMENT
SOLD OF DIVIDENDS REDEEMED NET INCREASE
----------------- ---------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
-------- ------ ------- ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 87,208 2,099 $19,815 487 $(42,996) (1,040) $ 64,027 1,546
Class B ......... 21,539 582 4,311 119 (17,276) (467) 8,574 234
Class C ......... 6,503 176 382 10 (1,605) (44) 5,280 142
Class I ......... 130,557 3,165 19,847 483 (1,153) (27) 149,251 3,621
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $111,137 2,980 $10,883 291 $(80,836) (2,167) $ 41,184 1,104
Class B ......... 29,204 875 1,832 55 (20,237) (605) 10,799 325
Class C ......... 5,584 166 118 4 (2,181) (65) 3,521 105
Class I ......... 36,035 970 11,387 301 (1,605) (43) 45,817 1,228
MID CAP STOCK FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- ---------------- ------------------ -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------- ------ --------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $90,008 4,510 $ 7,090 376 $ (8,672) (444) $ 88,426 4,442
Class B ......... 5,090 274 1,619 91 (2,362) (127) 4,347 238
Class C ......... 2,858 155 314 18 (349) (19) 2,823 154
Class I ......... 6,082 304 60,050 3,143 (134,569) (6,936) (68,437) (3,489)
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $31,725 1,718 $ 2,131 122 $ (8,746) (482) $ 25,110 1,358
Class B ......... 4,988 285 701 42 (3,819) (220) 1,870 107
Class C ......... 2,699 150 61 4 (471) (27) 2,289 127
Class I ......... 46,690 2,637 24,756 1,394 (6,515) (347) 64,931 3,684
GROWTH FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
----------------- --------------- ----------------- ------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
-------- ------ ------ ------ -------- ------ --------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 22,129 1,323 $ -- -- $(13,558) (814) $ 8,571 509
Class B ......... 1,879 126 -- -- (13,806) (927) (11,927) (801)
Class C ......... 1,085 73 -- -- (584) (39) 501 34
Class I ......... 556,508 32,059 2,024 117 (3,582) (207) 554,950 31,969
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $ 17,252 1,129 $ 448 29 $(26,052) (1,705) $ (8,352) (547)
Class B ......... 3,252 237 270 19 (26,857) (1,955) (23,335) (1,699)
Class C ......... 1,024 74 6 -- (1,036) (74) (6) --
Class I ......... 100,416 6,423 6,132 383 (12,625) (785) 93,923 6,021
88 See Notes to Financial Statements.
Statements of Changes in Net Assets -- Capital Stock Activity (continued)
WM GROUP OF FUNDS
(In thousands)
SMALL CAP VALUE FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- ---------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------- ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 2,728 227 $ 642 55 $ (4,264) (354) $ (894) (72)
Class B ......... 745 63 119 10 (687) (58) 177 15
Class C ......... 562 47 135 12 (643) (54) 54 5
Class I ......... 5,333 438 20,391 1,729 (69,227) (5,803) (43,503) (3,636)
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $16,188 1,333 $ 43 3 $ (4,665) (388) $ 11,566 948
Class B ......... 2,833 237 4 -- (479) (40) 2,358 197
Class C ......... 2,506 207 2 -- (426) (37) 2,082 170
Class I ......... 27,162 2,255 2,805 236 (500) (44) 29,467 2,447
SMALL CAP GROWTH FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- --------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------ ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $29,234 1,829 $-- -- $ (8,736) (572) $ 20,498 1,257
Class B ......... 715 53 -- -- (1,900) (142) (1,185) (89)
Class C ......... 520 38 -- -- (144) (11) 376 27
Class I ......... 18,837 1,223 -- -- (1,655) (101) 17,182 1,122
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $11,769 873 $-- -- $(23,784) (1,757) $(12,015) (884)
Class B ......... 811 68 -- -- (3,750) (319) (2,939) (251)
Class C ......... 555 46 -- -- (513) (43) 42 3
Class I ......... 35,485 2,536 -- -- (50,850) (3,688) (15,365) (1,152)
INTERNATIONAL GROWTH FUND
ISSUED AS
REINVESTMENT
SOLD OF DIVIDENDS REDEEMED NET INCREASE
----------------- ---------------- ---------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
-------- ------ ------- ------ ------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 40,960 3,370 $ 848 73 $(5,022) (420) $ 36,786 3,023
Class B ......... 5,734 496 28 3 (1,515) (132) 4,247 367
Class C ......... 2,771 243 18 2 (379) (33) 2,410 212
Class I ......... 144,141 11,985 14,503 1,246 (753) (59) 157,891 13,172
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $ 16,974 1,684 $ 356 36 $(7,565) (760) $ 9,765 960
Class B ......... 1,979 205 -- -- (1,400) (146) 579 59
Class C ......... 929 95 3 -- (298) (31) 634 64
Class I ......... 133,171 13,246 7,523 749 (100) (9) 140,594 13,986
See Notes to Financial Statements. 89
Statements of Changes in Net Assets -- Capital Stock Activity (continued)
WM GROUP OF FUNDS
(In thousands)
SHORT TERM INCOME FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- --------------- ------------------ -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------ ------ -------- ------- -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 6,543 2,834 $ 450 195 $(10,478) (4,532) $ (3,485) (1,503)
Class B ......... 1,689 731 243 105 (5,723) (2,477) (3,791) (1,641)
Class C ......... 377 163 118 51 (6,058) (2,618) (5,563) (2,404)
Class I ......... 5,131 2,219 3,893 1,686 (8,389) (3,634) 635 271
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $14,092 6,020 $1,042 445 $(31,717) (13,549) $(16,583) (7,084)
Class B ......... 2,089 891 592 253 (10,139) (4,327) (7,458) (3,183)
Class C ......... 3,121 1,330 389 166 (8,554) (3,655) (5,044) (2,159)
Class I ......... 24,653 10,528 6,799 2,909 -- -- 31,452 13,437
U.S. GOVERNMENT SECURITIES FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
----------------- ---------------- ------------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
-------- ------ ------- ------ --------- ------- -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 4,371 416 $ 1,929 184 $ (18,550) (1,768) $(12,250) (1,168)
Class B ......... 1,684 160 1,691 161 (22,624) (2,154) (19,249) (1,833)
Class C ......... 1,785 170 110 10 (889) (85) 1,006 95
Class I ......... 15,110 1,447 38,715 3,687 (113,504) (10,772) (59,679) (5,638)
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $ 20,979 1,956 $ 4,035 376 $ (35,252) (3,278) $(10,238) (946)
Class B ......... 4,266 397 3,945 367 (39,536) (3,681) (31,325) (2,917)
Class C ......... 3,171 296 175 17 (2,646) (246) 700 67
Class I ......... 363,440 33,841 67,624 6,304 -- -- 431,064 40,145
INCOME FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- ---------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------- ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $19,459 2,149 $ 2,472 273 $(20,805) (2,298) $ 1,126 124
Class B ......... 3,930 432 1,687 186 (21,252) (2,340) (15,635) (1,722)
Class C ......... 2,144 236 170 18 (2,231) (246) 83 8
Class I ......... 73,149 8,035 27,177 2,996 (7,898) (875) 92,428 10,156
Class R-1 ....... -- -- -- -- -- -- -- --
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $37,224 4,000 $ 4,859 523 $(35,692) (3,835) $ 6,391 688
Class B ......... 11,034 1,180 3,740 401 (32,674) (3,499) (17,900) (1,918)
Class C ......... 3,712 397 349 37 (4,371) (469) (310) (35)
Class I ......... 69,059 7,342 49,194 5,280 (9,340) (1,005) 108,913 11,617
90 See Notes to Financial Statements.
Statements of Changes in Net Assets -- Capital Stock Activity (continued)
WM GROUP OF FUNDS
(In thousands)
HIGH YIELD FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- ---------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------- ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $89,732 10,639 $ 2,794 329 $(26,482) (3,131) $ 66,044 7,837
Class B ......... 5,451 640 981 115 (8,111) (955) (1,679) (200)
Class C ......... 9,359 1,098 595 70 (3,538) (416) 6,416 752
Class I ......... 12,686 1,500 19,988 2,362 (66,043) (7,876) (33,369) (4,014)
Class R-1 ....... 76 9 -- -- (32) (4) 44 5
Class R-2 ....... -- -- -- -- -- -- -- --
YEAR ENDED 10/31/05:
Class A ......... $65,936 7,984 $ 3,681 445 $(42,841) (5,212) $ 26,776 3,217
Class B ......... 9,556 1,153 2,103 253 (17,586) (2,120) (5,927) (714)
Class C ......... 14,492 1,743 1,133 136 (10,204) (1,232) 5,421 647
Class I ......... 35,769 4,296 41,288 5,005 (11,065) (1,345) 65,992 7,956
TAX-EXEMPT BOND FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- --------------- ----------------- ----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------ ------ -------- ------ ------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 8,673 1,140 $4,921 650 $(15,853) (2,083) $(2,259) (293)
Class B ......... 425 55 755 100 (3,712) (487) (2,532) (332)
Class C ......... 1,202 158 82 11 (838) (110) 446 59
YEAR ENDED 10/31/05:
Class A ......... $15,149 1,928 $6,593 844 $(25,496) (3,258) $(3,754) (486)
Class B ......... 829 105 1,001 128 (6,139) (784) (4,309) (551)
Class C ......... 1,798 231 103 13 (3,081) (396) (1,180) (152)
CALIFORNIA MUNICIPAL FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- --------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------ ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $22,573 2,019 $5,587 502 $(17,606) (1,574) $ 10,554 947
Class B ......... 1,752 157 3,512 315 (18,080) (1,617) (12,816) (1,145)
Class C ......... 44 4 100 9 (762) (68) (618) (55)
YEAR ENDED 10/31/05:
Class A ......... $35,403 3,108 $6,596 580 $(28,521) (2,508) $ 13,478 1,180
Class B ......... 3,770 330 4,531 399 (38,993) (3,428) (30,692) (2,699)
Class C ......... 801 70 129 11 (1,486) (130) (556) (49)
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
ISSUED AS
REINVESTMENT NET INCREASE/
SOLD OF DIVIDENDS REDEEMED (DECREASE)
---------------- --------------- ----------------- -----------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------- ------ ------ ------ -------- ------ -------- ------
SIX MONTHS ENDED 4/30/06 (UNAUDITED):
Class A ......... $ 6,246 575 $ 827 76 $(10,754) (987) $ (3,681) (336)
Class B ......... 544 50 657 60 (7,423) (683) (6,222) (573)
Class C ......... 165 15 82 7 (841) (77) (594) (55)
YEAR ENDED 10/31/05:
Class A ......... $13,962 1,264 $1,383 126 $(13,695) (1,244) $ 1,650 146
Class B ......... 1,211 109 1,190 108 (12,651) (1,148) (10,250) (931)
Class C ......... 785 71 140 13 (2,002) (181) (1,077) (97)
See Notes to Financial Statements. 91
Financial Highlights
REIT FUND
For a Fund share outstanding throughout each period.
INCOME FROM INVESTMENT OPERATIONS
----------------------------------- LESS DISTRIBUTIONS
NET ----------------------------------------
NET REALIZED DISTRIBUTIONS NET
ASSET AND TOTAL DIVIDENDS FROM NET ASSET
VALUE NET UNREALIZED FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT GAIN ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD
--------- ---------- ---------- ---------- ---------- ------------- ------------- ------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $17.23 $0.10(6) $2.34 $2.44 $(0.21) $(0.40) $(0.61) $19.06
Year Ended:
10/31/05 $15.62 $0.42(6) $1.95 $2.37 $(0.42) $(0.34) $(0.76) $17.23
10/31/04 12.46 0.39(6) 3.13 3.52 (0.31) (0.05) (0.36) 15.62
10/31/03(3) 10.00 0.28(6) 2.35 2.63 (0.17) -- (0.17) 12.46
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $17.18 $0.03(6) $2.33 $2.36 $(0.14) $(0.40) $(0.54) $19.00
Year Ended:
10/31/05 $15.58 $0.29(6) $1.94 $2.23 $(0.29) $(0.34) $(0.63) $17.18
10/31/04 12.43 0.29(6) 3.12 3.41 (0.21) (0.05) (0.26) 15.58
10/31/03(3) 10.00 0.22(6) 2.35 2.57 (0.14) -- (0.14) 12.43
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $17.18 $0.04(6) $2.33 $2.37 $(0.15) $(0.40) $(0.55) $19.00
Year Ended:
10/31/05 $15.58 $0.30(6) $1.94 $2.24 $(0.30) $(0.34) $(0.64) $17.18
10/31/04 12.43 0.31(6) 3.12 3.43 (0.23) (0.05) (0.28) 15.58
10/31/03(3) 10.00 0.23(6) 2.35 2.58 (0.15) -- (0.15) 12.43
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $17.27 $0.15(6) $2.34 $2.49 $(0.25) $(0.40) $(0.65) $19.11
Year Ended:
10/31/05 $15.65 $0.49(6) $1.96 $2.45 $(0.49) $(0.34) $(0.83) $17.27
10/31/04 12.47 0.46(6) 3.14 3.60 (0.37) (0.05) (0.42) 15.65
10/31/03(3) 10.00 0.34(6) 2.32 2.66 (0.19) -- (0.19) 12.47
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $18.80 $0.05(6) $0.25 $0.30 $(0.06) $ -- $(0.06) $19.04
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $18.80 $0.05(6) $0.25 $0.30 $(0.06) $ -- $(0.06) $19.04
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
------------------------------------------------------------------
RATIO OF RATIO OF
EXPENSES TO EXPENSES TO RATIO OF
NET AVERAGE AVERAGE NET
ASSETS NET ASSETS NET ASSETS INVESTMENT
END OF BEFORE AFTER INCOME TO PORTFOLIO
TOTAL PERIOD REIMBURSEMENTS/ REIMBURSEMENTS/ AVERAGE TURNOVER
RETURN(1) (IN 000S) WAIVERS WAIVERS(2) NET ASSETS RATE
--------- --------- --------------- --------------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 14.49% $ 25,007 1.31%(7) 1.31%(7) 1.14%(7) 16%
Year Ended:
10/31/05 15.46% $ 18,234 1.31% 1.31% 2.50% 11%
10/31/04 28.71 9,376 1.33 1.33 2.82 5
10/31/03(3) 26.43 3,159 1.41(7) 1.41(7) 3.60(7) 7
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 14.04% $ 10,584 2.11%(7) 2.11%(7) 0.34%(7) 16%
Year Ended:
10/31/05 14.57% $ 8,898 2.09% 2.09% 1.72% 11%
10/31/04 27.76 6,060 2.08 2.08 2.07 5
10/31/03(3) 25.86 2,808 2.13(7) 2.13(7) 2.88(7) 7
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 14.09% $ 5,763 2.00%(7) 2.00%(7) 0.45%(7) 16%
Year Ended:
10/31/05 14.66% $ 5,100 2.00% 2.00% 1.81% 11%
10/31/04 27.95 3,672 1.98 1.98 2.17 5
10/31/03(3) 25.88 1,322 2.06(7) 2.06(7) 2.95(7) 7
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 14.75% $415,943 0.86%(7) 0.86%(7) 1.59%(7) 16%
Year Ended:
10/31/05 15.99% $388,914 0.84% 0.84% 2.97% 11%
10/31/04 29.40 316,904 0.86 0.86 3.29 5
10/31/03(3) 26.76 182,138 0.92(7) 0.92(7) 4.09(7) 7
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) 1.58% $ -- 1.91%(7)(8) 1.91%(7)(8) 0.54%(7)(8) 16%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) 1.58% $ -- 1.66%(7)(8) 1.66%(7)(8) 0.79%(7)(8) 16%
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges. The total returns would have been
lower if certain fees had not been waived and/or expenses reimbursed by the
investment advisor or if fees had not been reduced by credits allowed by
the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The REIT Fund commenced operations on March 1, 2003.
(4) The Funds commenced selling Class R-1 and R-2 shares on March 1, 2006.
92 See Notes to Financial Statements.
Financial Highlights
EQUITY INCOME FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
--------------------------------------
NET LESS DISTRIBUTIONS
NET REALIZED ---------------------------------------- NET
ASSET AND DIVIDENDS DISTRIBUTIONS ASSET
VALUE NET UNREALIZED TOTAL FROM FROM NET FROM NET VALUE
BEGINNING INVESTMENT GAIN/(LOSS) INVESTMENT INVESTMENT REALIZED TOTAL END OF
OF PERIOD INCOME ON INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS PERIOD
--------- ---------- -------------- ---------- ---------- ------------- ------------- ------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $20.07 $0.17(6) $ 2.05 $ 2.22 $(0.18) $(0.63) $(0.81) $21.48
Year Ended:
10/31/05 $17.79 $0.41(6) $ 2.25 $ 2.66 $(0.38) $ -- $(0.38) $20.07
10/31/04 15.46 0.29(6) 2.33 2.62 (0.29) -- (0.29) 17.79
10/31/03 12.73 0.33(6) 2.73 3.06 (0.33) -- (0.33) 15.46
10/31/02 14.85 0.40(6) (1.85) (1.45) (0.35) (0.32) (0.67) 12.73
10/31/01 15.59 0.48(6) 0.37 0.85 (0.46) (1.13) (1.59) 14.85
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $19.93 $0.08(6) $ 2.03 $ 2.11 $(0.09) $(0.63) $(0.72) $21.32
Year Ended:
10/31/05 $17.67 $0.24(6) $ 2.24 $ 2.48 $(0.22) $ -- $(0.22) $19.93
10/31/04 15.36 0.14(6) 2.30 2.44 (0.13) -- (0.13) 17.67
10/31/03 12.65 0.20(6) 2.71 2.91 (0.20) -- (0.20) 15.36
10/31/02 14.78 0.27(6) (1.85) (1.58) (0.23) (0.32) (0.55) 12.65
10/31/01 15.52 0.35(6) 0.38 0.73 (0.34) (1.13) (1.47) 14.78
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $19.79 $0.09(6) $ 2.02 $ 2.11 $(0.11) $(0.63) $(0.74) $21.16
Year Ended:
10/31/05 $17.57 $0.26(6) $ 2.22 $ 2.48 $(0.26) $ -- $(0.26) $19.79
10/31/04 15.29 0.16(6) 2.30 2.46 (0.18) -- (0.18) 17.57
10/31/03 12.62 0.22(6) 2.68 2.90 (0.23) -- (0.23) 15.29
10/31/02(5) 15.09 0.18(6) (2.43) (2.25) (0.22) -- (0.22) 12.62
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $20.07 $0.20(6) $ 2.05 $ 2.25 $(0.21) $(0.63) $(0.84) $21.48
Year Ended:
10/31/05 $17.79 $0.48(6) $ 2.24 $ 2.72 $(0.44) $ -- $(0.44) $20.07
10/31/04 15.45 0.35(6) 2.33 2.68 (0.34) -- (0.34) 17.79
10/31/03 12.73 0.38(6) 2.72 3.10 (0.38) -- (0.38) 15.45
10/31/02 14.85 0.45(6) (1.85) (1.40) (0.40) (0.32) (0.72) 12.73
10/31/01 15.59 0.54(6) 0.35 0.89 (0.50) (1.13) (1.63) 14.85
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $20.72 $0.03(4) $ 0.82 $ 0.85 $(0.09) $ -- $(0.09) $21.48
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $20.72 $0.07(4) $ 0.78 $ 0.85 $(0.09) $ -- $(0.09) $21.48
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES RATIO OF
NET TO AVERAGE TO AVERAGE NET
ASSETS NET ASSETS NET ASSETS INVESTMENT
END OF BEFORE AFTER INCOME TO PORTFOLIO
TOTAL PERIOD REIMBURSEMENTS/ REIMBURSEMENTS/ AVERAGE TURNOVER
RETURN(1) (IN 000S) WAIVERS WAIVERS(2) NET ASSETS RATE
--------- ---------- --------------- --------------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 11.32% $1,270,674 0.88%(7) 0.88%(7) 1.63%(7) 36%
Year Ended:
10/31/05 15.06% $ 887,828 0.90% 0.90% 2.13% 32%
10/31/04 17.06 438,776 0.91 0.91 1.74 20
10/31/03 24.43 268,489 0.95 0.95 2.43 18
10/31/02 (10.35) 198,756 0.97 0.97 2.77 16
10/31/01 5.92 211,445 0.97 0.96 3.17 17
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 10.85% $ 293,220 1.74%(7) 1.74%(7) 0.77%(7) 36%
Year Ended:
10/31/05 14.07% $ 226,390 1.78% 1.78% 1.25% 32%
10/31/04 16.04 144,144 1.81 1.81 0.84 20
10/31/03 23.19 103,888 1.89 1.89 1.49 18
10/31/02 (11.20) 82,330 1.88 1.88 1.86 16
10/31/01 5.09 68,549 1.82 1.81 2.32 17
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 10.91% $ 203,788 1.65%(7) 1.65%(7) 0.86%(7) 36%
Year Ended:
10/31/05 14.16% $ 128,523 1.68% 1.68% 1.35% 32%
10/31/04 16.16 33,770 1.70 1.70 0.95 20
10/31/03 23.29 5,973 1.78 1.78 1.60 18
10/31/02(5) (15.07) 1,780 1.80(7) 1.80(7) 1.94(7) 16
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 11.49% $1,700,951 0.55%(7) 0.55%(7) 1.96%(7) 36%
Year Ended:
10/31/05 15.39% $1,294,804 0.58% 0.58% 2.45% 32%
10/31/04 17.51 908,925 0.59 0.59 2.06 20
10/31/03 24.77 529,665 0.61 0.61 2.77 18
10/31/02 (10.04) 350,185 0.63 0.63 3.11 16
10/31/01 6.26 252,453 0.65 0.64 3.49 17
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) 4.03% $ 279 1.60%(7) 1.60%(7) 0.91%(7) 36%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) 4.03% $ -- 1.35%(7)(8) 1.35%(7)(8) 1.16%(7)(8) 36%
(5) The Equity Income Fund commenced selling Class C shares on March 1, 2002.
(6) Per share numbers have been calculated using the average shares method.
(7) Annualized.
(8) Ratios of expenses and net investment income to average net assets are
hypothetical, based on Class A share ratios adjusted for the respective
expenses of the share class.
See Notes to Financial Statements. 93
Financial Highlights
GROWTH & INCOME FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
----------------------------------------- LESS DISTRIBUTIONS
NET NET ----------------------------------------
ASSET NET REALIZED AND DIVIDENDS DISTRIBUTIONS
VALUE INVESTMENT UNREALIZED TOTAL FROM FROM NET FROM NET
BEGINNING INCOME/ GAIN/(LOSS) INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) ON INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
--------- ------------- -------------- ---------- ---------- ------------- -------------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $24.63 $ 0.17(5) $ 1.88 $ 2.05 $(0.31) $ -- $(0.31)
Year Ended:
10/31/05 $23.41 $ 0.33(5) $ 1.16 $ 1.49 $(0.27) $ -- $(0.27)
10/31/04 21.59 0.22(5) 1.81 2.03 (0.21) -- (0.21)
10/31/03 18.44 0.22(5) 3.11 3.33 (0.18) -- (0.18)
10/31/02 22.34 0.17(5) (3.68) (3.51) (0.03) (0.36) (0.39)
10/31/01 27.11 0.10 (3.63) (3.53) (0.07) (1.17) (1.24)
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $23.65 $ 0.04(5) $ 1.80 $ 1.84 $(0.03) $ -- $(0.03)
Year Ended:
10/31/05 $22.47 $ 0.08(5) $ 1.11 $ 1.19 $(0.01) $ -- $(0.01)
10/31/04 20.74 (0.01)(5) 1.74 1.73 -- -- --
10/31/03 17.72 0.02(5) 3.00 3.02 -- -- --
10/31/02 21.67 (0.04)(5) (3.55) (3.59) (0.00)(6) (0.36) (0.36)
10/31/01 26.49 (0.13) (3.52) (3.65) -- (1.17) (1.17)
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $23.33 $ 0.05(5) $ 1.80 $ 1.85 $(0.11) $ -- $(0.11)
Year Ended:
10/31/05 $22.22 $ 0.08(5) $ 1.10 $ 1.18 $(0.07) $ -- $(0.07)
10/31/04 20.62 (0.00)(5)(6) 1.73 1.73 (0.13) -- (0.13)
10/31/03 17.73 0.03(5) 2.98 3.01 (0.12) -- (0.12)
10/31/02(3) 21.36 (0.01)(5) (3.62) (3.63) -- -- --
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $24.75 $ 0.21(5) $ 1.88 $ 2.09 $(0.39) $ -- $(0.39)
Year Ended:
10/31/05 $23.52 $ 0.41(5) $ 1.17 $ 1.58 $(0.35) $ -- $(0.35)
10/31/04 21.68 0.30(5) 1.82 2.12 (0.28) -- (0.28)
10/31/03 18.52 0.29(5) 3.12 3.41 (0.25) -- (0.25)
10/31/02 22.39 0.24(5) (3.70) (3.46) (0.05) (0.36) (0.41)
10/31/01 27.16 0.18 (3.64) (3.46) (0.14) (1.17) (1.31)
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $25.62 $ 0.06(5) $ 0.69 $ 0.75 $ -- $ -- $ --
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $25.62 $ 0.06(5) $ 0.69 $ 0.75 $ -- $ -- $ --
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES RATIO OF
TO AVERAGE TO AVERAGE NET
NET NET NET ASSETS NET ASSETS INVESTMENT
ASSET ASSETS BEFORE AFTER INCOME/
VALUE END OF REIMBURSE- REIMBURSE- (LOSS) TO PORTFOLIO
END OF TOTAL PERIOD MENTS/ MENTS/ AVERAGE TURNOVER
PERIOD RETURN(1) (IN 000S) WAIVERS WAIVERS(2) NET ASSETS RATE
------ --------- ---------- ----------- ----------- ------------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $26.37 8.35% $ 590,185 0.87%(7) 0.87%(7) 1.32%(7) 15%
Year Ended:
10/31/05 $24.63 6.34% $ 572,128 0.89% 0.89% 1.34% 15%
10/31/04 23.41 9.45 582,866 0.90 0.90 0.94 6
10/31/03 21.59 18.18 541,707 0.93 0.93 1.12 17
10/31/02 18.44 (16.10) 475,010 0.94 0.94 0.79 22
10/31/01 22.34 (13.40) 560,226 0.92 0.92 0.40 35
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $25.46 7.78% $ 74,592 1.88%(7) 1.88%(7) 0.31%(7) 15%
Year Ended:
10/31/05 $23.65 5.28% $ 80,957 1.92% 1.92% 0.31% 15%
10/31/04 22.47 8.39 95,528 1.89 1.89 (0.05) 6
10/31/03 20.74 16.99 115,457 1.96 1.96 0.09 17
10/31/02 17.72 (16.94) 123,423 1.91 1.91 (0.18) 22
10/31/01 21.67 (14.20) 186,247 1.82 1.82 (0.50) 35
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $25.07 7.96% $ 2,271 1.81%(7) 1.81%(7) 0.38%(7) 15%
Year Ended:
10/31/05 $23.33 5.30% $ 1,835 1.88% 1.88% 0.35% 15%
10/31/04 22.22 8.45 1,537 1.84 1.84 (0.00) 6
10/31/03 20.62 17.08 823 1.89 1.89 0.16 17
10/31/02(3) 17.73 (17.00) 264 1.83(7) 1.83(7) (0.10)(7) 22
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $26.45 8.51% $1,684,307 0.54%(7) 0.54%(7) 1.65%(7) 15%
Year Ended:
10/31/05 $24.75 6.70% $1,963,730 0.56% 0.56% 1.67% 15%
10/31/04 23.52 9.85 1,394,883 0.57 0.57 1.27 6
10/31/03 21.68 18.61 895,547 0.59 0.59 1.46 17
10/31/02 18.52 (15.84) 671,191 0.60 0.60 1.13 22
10/31/01 22.39 (13.12) 768,550 0.58 0.58 0.74 35
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $26.37 2.93% $ -- 1.59%(7)(8) 1.59%(7)(8) 0.60%(7)(8) 15%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $26.37 2.93% $ -- 1.34%(7)(8) 1.34%(7)(8) 0.85%(7)(8) 15%
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges.
The total returns would have been lower if certain fees had not been waived
and/or expenses reimbursed by the investment advisor or if fees had not
been reduced by credits allowed by the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The Funds commenced selling Class C shares on March 1, 2002.
(4) The Funds commenced selling Class R-1 and R-2 shares on March 1, 2006.
94 See Notes to Financial Statements.
Financial Highlights
WEST COAST EQUITY FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
----------------------------------------- LESS DISTRIBUTIONS
NET NET ----------------------------------------
ASSET NET REALIZED AND DIVIDENDS DISTRIBUTIONS
VALUE INVESTMENT UNREALIZED TOTAL FROM FROM NET FROM NET
BEGINNING INCOME/ GAIN/(LOSS) INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) ON INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
--------- ------------- -------------- ---------- ---------- ------------- -------------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $38.99 $ 0.11(5) $ 4.43 $ 4.54 $(0.13) $(0.97) $(1.10)
Year Ended:
10/31/05 $35.04 $ 0.25 $ 4.33 $ 4.58 $(0.20) $(0.43) $(0.63)
10/31/04 32.14 0.06(5) 2.84 2.90 -- -- --
10/31/03 23.73 0.04(5) 8.37 8.41 -- -- --
10/31/02 28.89 0.02(5) (4.09) (4.07) (0.07) (1.02) (1.09)
10/31/01 36.23 0.11 (2.35) (2.24) (0.03) (5.07) (5.10)
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $34.84 $(0.07)(5) $ 3.95 $ 3.88 $ -- $(0.97) $(0.97)
Year Ended:
10/31/05 $31.48 $(0.09) $ 3.88 $ 3.79 $ -- $(0.43) $(0.43)
10/31/04 29.14 (0.24)(5) 2.58 2.34 -- -- --
10/31/03 21.73 (0.20)(5) 7.61 7.41 -- -- --
10/31/02 26.71 (0.23)(5) (3.73) (3.96) (0.00)(6) (1.02) (1.02)
10/31/01 34.12 (0.15) (2.19) (2.34) -- (5.07) (5.07)
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $34.94 $(0.05)(5) $ 3.96 $ 3.91 $ -- $(0.97) $(0.97)
Year Ended:
10/31/05 $31.56 $(0.06) $ 3.88 $ 3.82 $(0.01) $(0.43) $(0.44)
10/31/04 29.20 (0.21)(5) 2.57 2.36 -- -- --
10/31/03 21.74 (0.18)(5) 7.64 7.46 -- -- --
10/31/02(3) 27.59 (0.14)(5) (5.71) (5.85) -- -- --
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $39.39 $ 0.18(5) $ 4.47 $ 4.65 $(0.25) $(0.97) $(1.22)
Year Ended:
10/31/05 $35.39 $ 0.39 $ 4.37 $ 4.76 $(0.33) $(0.43) $(0.76)
10/31/04 32.39 0.17(5) 2.87 3.04 (0.04) -- (0.04)
10/31/03 23.83 0.13(5) 8.43 8.56 -- -- --
10/31/02 29.00 0.12(5) (4.10) (3.98) (0.17) (1.02) (1.19)
10/31/01 36.34 0.20 (2.34) (2.14) (0.13) (5.07) (5.20)
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $41.49 $ 0.06(5) $ 0.88 $ 0.94 $ -- $ -- $ --
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $41.49 $ 0.06(5) $ 0.88 $ 0.94 $ -- $ -- $ --
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES RATIO OF
TO AVERAGE TO AVERAGE NET
NET NET NET ASSETS NET ASSETS INVESTMENT
ASSET ASSETS BEFORE AFTER INCOME/
VALUE END OF REIMBURSE- REIMBURSE- (LOSS) TO PORTFOLIO
END OF TOTAL PERIOD MENTS/ MENTS/ AVERAGE TURNOVER
PERIOD RETURN(1) (IN 000S) WAIVERS WAIVERS(2) NET ASSETS RATE
------ --------- --------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $42.43 11.76% $865,459 0.87%(7) 0.87%(7) 0.54%(7) 5%
Year Ended:
10/31/05 $38.99 13.13% $735,037 0.91% 0.91% 0.68% 13%
10/31/04 35.04 9.06 621,924 0.94 0.94 0.17 12
10/31/03 32.14 35.44 523,308 1.02 1.02 0.14 14
10/31/02 23.73 (14.94) 375,821 1.05 1.05 0.07 16
10/31/01 28.89 (6.55) 427,215 1.01 1.01 0.38 27
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $37.75 11.24% $190,358 1.78%(7) 1.78%(7) (0.37)%(7) 5%
Year Ended:
10/31/05 $34.84 12.09% $167,531 1.85% 1.85% (0.26)% 13%
10/31/04 31.48 8.03 141,134 1.89 1.89 (0.78) 12
10/31/03 29.14 34.10 122,221 2.01 2.01 (0.85) 14
10/31/02 21.73 (15.73) 102,208 2.00 2.00 (0.88) 16
10/31/01 26.71 (7.40) 109,655 1.89 1.89 (0.50) 27
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $37.88 11.29% $ 20,164 1.70%(7) 1.70%(7) (0.29)%(7) 5%
Year Ended:
10/31/05 $34.94 12.18% $ 13,613 1.78% 1.78% (0.19)% 13%
10/31/04 31.56 8.12 9,000 1.80 1.80 (0.69) 12
10/31/03 29.20 34.27 3,593 1.90 1.90 (0.74) 14
10/31/02(3) 21.74 (21.20) 1,341 1.96(7) 1.96(7) (0.84)(7) 16
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $42.82 11.94% $831,184 0.54%(7) 0.54%(7) 0.87%(7) 5%
Year Ended:
10/31/05 $39.39 13.55% $621,993 0.58% 0.58% 1.01% 13%
10/31/04 35.39 9.39 515,464 0.61 0.61 0.50 12
10/31/03 32.39 35.92 349,363 0.67 0.67 0.49 14
10/31/02 23.83 (14.65) 195,029 0.70 0.70 0.42 16
10/31/01 29.00 (6.22) 176,303 0.68 0.68 0.71 27
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $42.43 2.27% $ -- 1.59%(7)(8) 1.59%(7)(8) (0.18)%(7)(8) 5%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $42.43 2.27% $ -- 1.34%(7)(8) 1.34%(7)(8) 0.07%(7)(8) 5%
(5) Per share numbers have been calculated using the average shares method.
(6) Amount represents less than $0.01 per share.
(7) Annualized.
(8) Ratios of expenses and net investment income to average net assets are
hypothetical, based on Class Ashare ratios adjusted for the respective
expenses of the share class.
See Notes to Financial Statements. 95
Financial Highlights
MID CAP STOCK FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS)FROM
INVESTMENT OPERATIONS LESS DISTRIBUTIONS
------------------------------------ ----------------------------------------
NET REALIZED
NET AND
ASSET NET UNREALIZED DIVIDENDS DISTRIBUTIONS
VALUE INVESTMENT GAIN/(LOSS) TOTAL FROM FROM NET FROM NET
BEGINNING INCOME/ ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
--------- ---------- ------------ ---------- ---------- ------------- -------------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $19.23 $ 0.06(5) $ 2.58 $ 2.64 $(0.26) $(1.23) $(1.49)
Year Ended:
10/31/05 $17.06 $ 0.24(5) $ 2.56 $ 2.80 $(0.03) $(0.60) $(0.63)
10/31/04 15.34 0.02(5) 1.75 1.77 (0.01) (0.04) (0.05)
10/31/03 12.39 0.01(5) 2.94 2.95 -- -- --
10/31/02 13.50 (0.01)(5) (0.60) (0.61) -- (0.50) (0.50)
10/31/01 12.58 (0.03)(5) 1.00 0.97 -- (0.05) (0.05)
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $18.23 $(0.03)(5) $ 2.44 $ 2.41 $(0.10) $(1.23) $(1.33)
Year Ended:
10/31/05 $16.33 $ 0.06(5) $ 2.44 $ 2.50 $ -- $(0.60) $(0.60)
10/31/04 14.82 (0.14)(5) 1.69 1.55 -- (0.04) (0.04)
10/31/03 12.09 (0.13)(5) 2.86 2.73 -- -- --
10/31/02 13.31 (0.15)(5) (0.57) (0.72) -- (0.50) (0.50)
10/31/01 12.51 (0.15)(5) 1.00 0.85 -- (0.05) (0.05)
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $18.28 $(0.02)(5) $ 2.45 $ 2.43 $(0.18) $(1.23) $(1.41)
Year Ended:
10/31/05 $16.36 $ 0.08(5) $ 2.44 $ 2.52 $ -- $(0.60) $(0.60)
10/31/04 14.83 (0.13)(5) 1.70 1.57 -- (0.04) (0.04)
10/31/03 12.10 (0.12)(5) 2.85 2.73 -- -- --
10/31/02(3) 13.60 (0.10)(5) (1.40) (1.50) -- -- --
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $19.47 $ 0.09(5) $ 2.61 $ 2.70 $(0.31) $(1.23) $(1.54)
Year Ended:
10/31/05 $17.26 $ 0.30(5) $ 2.59 $ 2.89 $(0.08) $(0.60) $(0.68)
10/31/04 15.50 0.08(5) 1.78 1.86 (0.06) (0.04) (0.10)
10/31/03 12.51 0.06(5) 2.97 3.03 (0.04) -- (0.04)
10/31/02 13.59 0.04(5) (0.60) (0.56) (0.02) (0.50) (0.52)
10/31/01 12.62 0.04(5) 1.00 1.04 (0.02) (0.05) (0.07)
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $19.39 $ 0.03(5) $ 0.96 $ 0.99 $ -- $ -- $ --
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $19.39 $ 0.03(5) $ 0.96 $ 0.99 $ -- $ -- $ --
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES RATIO OF
TO AVERAGE TO AVERAGE NET
NET NET NET ASSETS NET ASSETS INVESTMENT
ASSET ASSETS BEFORE AFTER INCOME/
VALUE END OF REIMBURSE- REIMBURSE- (LOSS)TO PORTFOLIO
END OF TOTAL PERIOD MENTS/ MENTS/ AVERAGE TURNOVER
PERIOD RETURN(1) (IN 000S) WAIVERS WAIVERS(2) NET ASSETS RATE
------ --------- --------- ----------- ----------- ------------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $20.38 14.43% $189,282 1.10%(7) 1.10%(7) 0.60%(7) 14%
Year Ended:
10/31/05 $19.23 16.75% $ 93,180 1.12% 1.12% 1.32% 28%
10/31/04 17.06 11.57 59,491 1.14 1.14 0.12 23
10/31/03 15.34 23.81 38,676 1.16 1.16 0.07 28
10/31/02 12.39 (4.86) 28,248 1.25 1.25 (0.10) 27
10/31/01 13.50 7.71 6,165 1.36 1.36 (0.25) 33
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $19.31 13.88% $ 30,251 2.05%(7) 2.05%(7) (0.35)%(7) 14%
Year Ended:
10/31/05 $18.23 15.63% $ 24,218 2.11% 2.11% 0.33% 28%
10/31/04 16.33 10.54 19,958 2.12 2.12 (0.86) 23
10/31/03 14.82 22.50 17,405 2.24 2.24 (1.01) 28
10/31/02 12.09 (5.79) 13,229 2.26 2.26 (1.11) 27
10/31/01 13.31 6.79 10,271 2.17 2.17 (1.06) 33
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $19.30 13.97% $ 7,501 1.94%(7) 1.94%(7) (0.24)%(7) 14%
Year Ended:
10/31/05 $18.28 15.73% $ 4,303 1.99% 1.99% 0.45% 28%
10/31/04 16.36 10.60 1,769 2.04 2.04 (0.79) 23
10/31/03 14.83 22.56 550 2.15 2.15 (0.92) 28
10/31/02(3) 12.10 (11.03) 55 2.24(7) 2.24(7) (1.09)(7) 27
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $20.63 14.58% $740,569 0.79%(7) 0.79%(7) 0.91%(7) 14%
Year Ended:
10/31/05 $19.47 17.11% $766,698 0.80% 0.80% 1.64% 28%
10/31/04 17.26 12.02 616,052 0.80 0.80 0.45 23
10/31/03 15.50 24.27 369,772 0.81 0.81 0.42 28
10/31/02 12.51 (4.44) 231,409 0.83 0.83 0.32 27
10/31/01 13.59 8.29 220,052 0.81 0.81 0.30 33
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $20.38 5.11% $ -- 1.84%(7)(8) 1.84%(7)(8) (0.14)%(7)(8) 14%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $20.38 5.11% $ -- 1.59%(7)(8) 1.59%(7)(8) 0.11%(7)(8) 14%
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges.
The total returns would have been lower if certain fees had not been waived
and/or expenses reimbursed by the investment advisor or if fees had not
been reduced by credits allowed by the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The Funds commenced selling Class C shares on March 1, 2002.
(4) The Funds commenced selling Class R-1 and R-2 shares on March 1, 2006.
96 See Notes to Financial Statements.
Financial Highlights
GROWTH FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS)FROM
INVESTMENT OPERATIONS LESS DISTRIBUTIONS
-------------------------------------- ----------------------------------------
NET REALIZED
NET AND
ASSET NET UNREALIZED DIVIDENDS DISTRIBUTIONS
VALUE INVESTMENT GAIN/(LOSS) TOTAL FROM FROM NET FROM NET
BEGINNING INCOME/ ON INVESTMENT INVESTMENT REALIZED TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME CAPITAL GAINS DISTRIBUTIONS
--------- ------------ ------------ ---------- ---------- ------------- -------------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $15.77 $(0.02) $ 0.87 $ 0.85 $ -- $ -- $ --
Year Ended:
10/31/05 $14.44 $ 0.01 $ 1.37 $ 1.38 $(0.05) $ -- $(0.05)
10/31/04 13.71 (0.06)(5) 0.79 0.73 -- -- --
10/31/03 11.47 (0.08)(5) 2.32 2.24 -- -- --
10/31/02 15.23 (0.10)(5) (3.66) (3.76) -- -- --
10/31/01 32.78 (0.09)(5) (13.13) (13.22) (0.20) (4.13) (4.33)
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $14.12 $(0.08) $ 0.77 $ 0.69 $ -- $ -- $ --
Year Ended:
10/31/05 $13.03 $(0.14) $ 1.26 $ 1.12 $(0.03) $ -- $(0.03)
10/31/04 12.49 (0.17)(5) 0.71 0.54 -- -- --
10/31/03 10.55 (0.18)(5) 2.12 1.94 -- -- --
10/31/02 14.13 (0.21)(5) (3.37) (3.58) -- -- --
10/31/01 30.78 (0.24)(5) (12.24) (12.48) (0.04) (4.13) (4.17)
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $14.25 $(0.07) $ 0.78 $ 0.71 $ -- $ -- $ --
Year Ended:
10/31/05 $13.13 $(0.11) $ 1.27 $ 1.16 $(0.04) $ -- $(0.04)
10/31/04 12.55 (0.15)(5) 0.73 0.58 -- -- --
10/31/03 10.56 (0.14)(5) 2.13 1.99 -- -- --
10/31/02(3) 13.48 (0.11)(5) (2.81) (2.92) -- -- --
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $16.43 $ 0.03 $ 0.90 $ 0.93 $(0.02) $ -- $(0.02)
Year Ended:
10/31/05 $14.96 $ 0.10 $ 1.44 $ 1.54 $(0.07) $ -- $(0.07)
10/31/04 14.13 0.02(5) 0.81 0.83 -- -- --
10/31/03 11.74 0.00(5)(6) 2.39 2.39 -- -- --
10/31/02 15.48 (0.01)(5) (3.73) (3.74) -- -- --
10/31/01 33.23 0.02(5) (13.31) (13.29) (0.33) (4.13) (4.46)
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $16.58 $ 0.01 $ 0.03 $ 0.04 $ -- $ -- $ --
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $16.58 $ 0.01 $ 0.03 $ 0.04 $ -- $ -- $ --
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
--------------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES RATIO OF
TO AVERAGE TO AVERAGE NET
NET NET NET ASSETS NET ASSETS INVESTMENT
ASSET ASSETS BEFORE AFTER INCOME/
VALUE END OF REIMBURSE- REIMBURSE- (LOSS)TO PORTFOLIO
END OF TOTAL PERIOD MENTS/ MENTS/ AVERAGE TURNOVER
PERIOD RETURN(1) (IN 000S) WAIVERS WAIVERS(2) NET ASSETS RATE
------ --------- ---------- ----------- ----------- ------------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $16.62 5.39% $ 143,023 1.27%(7) 1.27%(7) (0.19)%(7) 18%
Year Ended:
10/31/05 $15.77 9.59% $ 127,677 1.41% 1.41% 0.06% 78%
10/31/04 14.44 5.32 124,755 1.44 1.44 (0.43) 56
10/31/03 13.71 19.53 114,757 1.62 1.62 (0.66) 71
10/31/02 11.47 (24.69) 94,848 1.69 1.69 (0.74) 170
10/31/01 15.23 (45.77) 151,893 1.52 1.52 (0.43) 99
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $14.81 4.89% $ 88,870 2.23%(7) 2.23%(7) (1.15)%(7) 18%
Year Ended:
10/31/05 $14.12 8.55% $ 96,044 2.36% 2.36% (0.89)% 78%
10/31/04 13.03 4.40 110,794 2.35 2.35 (1.34) 56
10/31/03 12.49 18.39 129,239 2.54 2.54 (1.58) 71
10/31/02 10.55 (25.34) 128,007 2.54 2.54 (1.59) 170
10/31/01 14.13 (46.19) 220,108 2.31 2.31 (1.22) 99
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $14.96 4.98% $ 2,767 2.03%(7) 2.03%(7) (0.95)%(7) 18%
Year Ended:
10/31/05 $14.25 8.85% $ 2,158 2.13% 2.13% (0.66)% 78%
10/31/04 13.13 4.62 1,981 2.14 2.14 (1.13) 56
10/31/03 12.55 18.85 565 2.19 2.19 (1.23) 71
10/31/02(3) 10.56 (21.66) 199 2.38(7) 2.38(7) (1.43)(7) 170
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $17.34 5.65% $2,144,581 0.74%(7) 0.74%(7) 0.34%(7) 18%
Year Ended:
10/31/05 $16.43 10.30% $1,506,501 0.83% 0.83% 0.64% 78%
10/31/04 14.96 5.95 1,281,900 0.86 0.86 0.15 56
10/31/03 14.13 20.27 664,334 0.92 0.92 0.04 71
10/31/02 11.74 (24.16) 357,296 1.03 1.03 (0.08) 170
10/31/01 15.48 (45.50) 203,646 1.00 1.00 0.09 99
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $16.62 0.24% $ -- 1.79%(7)(8) 1.79%(7)(8) (0.71)%(7)(8) 18%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $16.62 0.24% $ -- 1.54%(7)(8) 1.54%(7)(8) (0.46)%(7)(8) 18%
(5) Per share numbers have been calculated using the average shares method.
(6) Amount represents less than $0.01 per share.
(7) Annualized.
(8) Ratios of expenses and net investment income to average net assets are
hypothetical, based on Class A share ratios adjusted for the respective
expenses of the share class.
See Notes to Financial Statements. 97
Financial Highlights
SMALL CAP VALUE FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
-------------------------------------- LESS DISTRIBUTIONS
NET ----------------------------------------
NET REALIZED DISTRIBUTIONS NET
ASSET AND DIVIDENDS FROM NET ASSET
VALUE NET UNREALIZED TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT GAIN ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME/(LOSS) INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ------------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $11.68 $ 0.08(6) $1.21 $1.29 $(0.07) $(0.65) $(0.72) $12.25 11.24%
Year Ended:
10/31/05 $10.81 $ 0.06(6) $0.91 $0.97 $(0.10) $ -- $(0.10) $11.68 9.04%
10/31/04(3) 10.00 0.05(6) 0.76 0.81 -- -- -- 10.81 8.10
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $11.55 $ 0.02(6) $1.20 $1.22 $ -- $(0.65) $(0.65) $12.12 10.79%
Year Ended:
10/31/05 $10.74 $(0.05)(6) $0.92 $0.87 $(0.06) $ -- $(0.06) $11.55 8.08%
10/31/04(3) 10.00 (0.01)(6) 0.75 0.74 -- -- -- 10.74 7.40
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $11.58 $ 0.03(6) $1.21 $1.24 $(0.03) $(0.65) $(0.68) $12.14 10.92%
Year Ended:
10/31/05 $10.76 $(0.03)(6) $0.90 $0.87 $(0.05) $ -- $(0.05) $11.58 8.08%
10/31/04(3) 10.00 (0.00)(6)(8) 0.76 0.76 -- -- -- 10.76 7.60
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $11.74 $ 0.11(6) $1.22 $1.33 $(0.11) $(0.65) $(0.76) $12.31 11.61%
Year Ended:
10/31/05 $10.83 $ 0.11(6) $0.91 $1.02 $(0.11) $ -- $(0.11) $11.74 9.42%
10/31/04(3) 10.00 0.08(6) 0.75 0.83 -- -- -- 10.83 8.30
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $12.02 $ 0.04(6) $0.19 $0.23 $ -- $ -- $ -- $12.25 1.91%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $12.02 $ 0.04(6) $0.19 $0.23 $ -- $ -- $ -- $12.25 1.91%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO RATIO OF
AVERAGE AVERAGE NET
NET NET INVESTMENT
NET ASSETS ASSETS INCOME
ASSETS BEFORE AFTER /(LOSS) TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS(2) ASSETS RATE
---------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $ 14,117 1.34%(7) 1.34%(7) 1.31%(7) 15%
Year Ended:
10/31/05 $ 14,302 1.29% 1.29% 0.52% 54%
10/31/04(3) 2,978 1.33(7) 1.33(7) 0.77(7) 36
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $ 3,289 2.26%(7) 2.26%(7) 0.39%(7) 15%
Year Ended:
10/31/05 $ 2,955 2.20% 2.20% (0.39)% 54%
10/31/04(3) 631 2.23(7) 2.23(7) (0.13)(7) 36
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 2,592 2.08%(7) 2.08%(7) 0.57%(7) 15%
Year Ended:
10/31/05 $ 2,414 2.10% 2.10% (0.29)% 54%
10/31/04(3) 414 2.13(7) 2.13(7) (0.03)(7) 36
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $290,336 0.90%(7) 0.90%(7) 1.75%(7) 15%
Year Ended:
10/31/05 $319,631 0.90% 0.90% 0.91% 54%
10/31/04(3) 268,310 0.95(7) 0.95(7) 1.15(7) 36
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.95%(7)(9) 1.95%(7)(9) 0.70%(7)(9) 15%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.70%(7)(9) 1.70%(7)(9) 0.95%(7)(9) 15%
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges.
The total returns would have been lower if certain fees had not been waived
and/or expenses reimbursed by the investment advisor or if fees had not
been reduced by credits allowed by the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The Small Cap Value Fund commenced operations on March 1, 2004.
(4) The Funds commenced selling Class R-1 and Class R-2 shares on March 1,
2006.
98 See Notes to Financial Statements.
Financial Highlights
SMALL CAP GROWTH FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
--------------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD LOSS INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ------------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $13.93 $(0.07)(6) $ 2.16 $ 2.09 $ -- $ -- $ -- $16.02 14.93%
Year Ended:
10/31/05 $13.00 $(0.13)(6) $ 1.06 $ 0.93 $ -- $ -- $ -- $13.93 7.15%
10/31/04 13.42 (0.14)(6) (0.28) (0.42) -- -- -- 13.00 (3.13)
10/31/03 8.21 (0.09)(6) 5.30 5.21 -- -- -- 13.42 63.46
10/31/02 13.60 (0.14)(6) (4.28) (4.42) -- (0.97) (0.97) 8.21 (35.71)
10/31/01 26.67 (0.20) (9.56) (9.76) -- (3.31) (3.31) 13.60 (40.84)
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $12.14 $(0.13)(6) $ 1.87 $ 1.74 $ -- $ -- $ -- $13.88 14.33%
Year Ended:
10/31/05 $11.46 $(0.25)(6) $ 0.93 $ 0.68 $ -- $ -- $ -- $12.14 5.93%
10/31/04 11.96 (0.26)(6) (0.24) (0.50) -- -- -- 11.46 (4.18)
10/31/03 7.40 (0.18)(6) 4.74 4.56 -- -- -- 11.96 61.62
10/31/02 12.46 (0.23)(6) (3.86) (4.09) -- (0.97) (0.97) 7.40 (36.36)
10/31/01 24.93 (0.32) (8.84) (9.16) -- (3.31) (3.31) 12.46 (41.35)
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $12.31 $(0.11)(6) $ 1.90 $ 1.79 $ -- $ -- $ -- $14.10 14.54%
Year Ended:
10/31/05 $11.59 $(0.22)(6) $ 0.94 $ 0.72 $ -- $ -- $ -- $12.31 6.21%
10/31/04 12.06 (0.23)(6) (0.24) (0.47) -- -- -- 11.59 (3.90)
10/31/03 7.42 (0.14)(6) 4.78 4.64 -- -- -- 12.06 62.53
10/31/02(5) 11.51 (0.10)(6) (3.99) (4.09) -- -- -- 7.42 (35.53)
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $14.43 $(0.03)(6) $ 2.22 $ 2.19 $ -- $ -- $ -- $16.62 15.18%
Year Ended:
10/31/05 $13.39 $(0.07)(6) $ 1.11 $ 1.04 $ -- $ -- $ -- $14.43 7.77%
10/31/04 13.76 (0.07)(6) (0.30) (0.37) -- -- -- 13.39 (2.62)
10/31/03 8.35 (0.02)(6) 5.43 5.41 -- -- -- 13.76 64.67
10/31/02 13.74 (0.06)(6) (4.36) (4.42) -- (0.97) (0.97) 8.35 (35.32)
10/31/01 26.77 (0.06) (9.66) (9.72) -- (3.31) (3.31) 13.74 (40.49)
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $15.61 $(0.01)(6) $ 0.41 $ 0.40 $ -- $ -- $ -- $16.01 2.56%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $15.61 $(0.01)(6) $ 0.41 $ 0.40 $ -- $ -- $ -- $16.01 2.56%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO RATIO OF
AVERAGE AVERAGE NET
NET NET INVESTMENT
NET ASSETS ASSETS INCOME
ASSETS BEFORE AFTER /LOSS TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS(2) ASSETS RATE
---------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $120,439 1.40%(7) 1.40%(7) (0.88)%(7) 37%
Year Ended:
10/31/05 $ 87,252 1.51% 1.51% (1.00)% 251%(10)
10/31/04 92,919 1.46 1.46 (1.01) 53
10/31/03 81,234 1.64 1.64 (0.86) 40
10/31/02 42,984 1.68 1.68 (1.20) 21
10/31/01 66,262 1.52 1.52 (1.03) 46
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $ 10,030 2.53%(7) 2.53%(7) (2.01)%(7) 37%
Year Ended:
10/31/05 $ 9,859 2.65% 2.65% (2.14)% 251%(10)
10/31/04 12,181 2.54 2.54 (2.09) 53
10/31/03 18,037 2.81 2.81 (2.03) 40
10/31/02 14,238 2.64 2.64 (2.16) 21
10/31/01 29,346 2.42 2.42 (1.93) 46
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 1,485 2.16%(7) 2.16%(7) (1.64)%(7) 37%
Year Ended:
10/31/05 $ 954 2.33% 2.33% (1.82)% 251%(10)
10/31/04 871 2.28 2.28 (1.83) 53
10/31/03 404 2.28 2.28 (1.50) 40
10/31/02(5) 69 2.25(7) 2.25(7) (1.77)(7) 21
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $294,459 0.93%(7) 0.93%(7) (0.41)%(7) 37%
Year Ended:
10/31/05 $239,308 0.98% 0.98% (0.47)% 251%(10)
10/31/04 237,582 0.95 0.95 (0.50) 53
10/31/03 337,271 0.96 0.96 (0.18) 40
10/31/02 123,620 1.00 1.00 (0.52) 21
10/31/01 134,462 0.97 0.97 (0.48) 46
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.98%(7)(9) 1.98%(7)(9) (1.46)%(7)(9) 37%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.73%(7)(9) 1.73%(7)(9) (1.21)%(7)(9) 37%
(5) The Small Cap Growth Fund commenced selling Class C shares on March 1,
2002.
(6) Per share numbers have been calculated using the average shares method.
(7) Annualized.
(8) Amount represents less than $0.01 per share.
(9) Ratios of expenses and net investment income to average net assets are
hypothetical, based on Class A share ratios adjusted for the respective
expenses of the share class.
(10) The Small Cap Growth Fund had unusually high portfolio turnover due to a
change in sub-advisors.
See Notes to Financial Statements. 99
Financial Highlights
INTERNATIONAL GROWTH FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
--------------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME/(LOSS) INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ------------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $10.74 $ 0.04(5) $ 2.28 $ 2.32 $(0.16) $ -- $(0.16) $12.90 21.77%
Year Ended:
10/31/05 $ 9.21 $ 0.10(5) $ 1.52 $ 1.62 $(0.09) $ -- $(0.09) $10.74 17.60%
10/31/04 8.38 0.06(5) 0.85 0.91 (0.08) -- (0.08) 9.21 10.89
10/31/03 6.76 0.03(5) 1.63 1.66 (0.04) -- (0.04) 8.38 24.75
10/31/02 7.61 (0.02)(5) (0.75) (0.77) (0.08) -- (0.08) 6.76 (10.36)
10/31/01 10.97 (0.02) (2.67) (2.69) (0.01) (0.66) (0.67) 7.61 (25.99)
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $10.24 $(0.02)(5) $ 2.18 $ 2.16 $(0.07) $ -- $(0.07) $12.33 21.11%
Year Ended:
10/31/05 $ 8.80 $(0.01)(5) $ 1.45 $ 1.44 $ -- $ -- $ -- $10.24 16.36%
10/31/04 8.03 (0.04)(5) 0.81 0.77 -- -- -- 8.80 9.59
10/31/03 6.51 (0.05)(5) 1.57 1.52 -- -- -- 8.03 23.35
10/31/02 7.35 (0.09)(5) (0.73) (0.82) (0.02) -- (0.02) 6.51 (11.23)
10/31/01 10.70 (0.10) (2.58) (2.68) (0.01) (0.66) (0.67) 7.35 (26.68)
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $10.14 $(0.00)(5)(6) $ 2.15 $ 2.15 $(0.13) $ -- $(0.13) $12.16 21.32%
Year Ended:
10/31/05 $ 8.75 $ 0.01(5) $ 1.44 $ 1.45 $(0.06) $ -- $(0.06) $10.14 16.60%
10/31/04 8.02 (0.02)(5) 0.81 0.79 (0.06) -- (0.06) 8.75 9.87
10/31/03 6.53 (0.03)(5) 1.56 1.53 (0.04) -- (0.04) 8.02 23.57
10/31/02(3) 7.55 (0.05)(5) (0.96) (1.01) (0.01) -- (0.01) 6.53 (13.34)
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $10.81 $0.07(5) $ 2.29 $ 2.36 $(0.20) $ -- $(0.20) $12.97 22.02%
Year Ended:
10/31/05 $ 9.26 $0.15(5) $ 1.53 $ 1.68 $(0.13) $ -- $(0.13) $10.81 18.19%
10/31/04 8.43 0.11(5) 0.84 0.95 (0.12) -- (0.12) 9.26 11.38
10/31/03 6.80 0.08(5) 1.64 1.72 (0.09) -- (0.09) 8.43 25.56
10/31/02 7.69 0.04(5) (0.75) (0.71) (0.18) -- (0.18) 6.80 (9.61)
10/31/01 11.00 0.04 (2.68) (2.64) (0.01) (0.66) (0.67) 7.69 (25.53)
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $12.05 $0.02(5) $ 0.83 $ 0.85 $ -- $ -- $ -- $12.90 7.06%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $12.05 $0.02(5) $ 0.83 $ 0.85 $ -- $ -- $ -- $12.90 7.06%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
----------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO RATIO OF
AVERAGE AVERAGE NET
NET NET INVESTMENT
NET ASSETS ASSETS INCOME/
ASSETS BEFORE AFTER (LOSS) TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS(2) ASSETS RATE
---------- ---------- ----------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $ 105,830 1.30%(7) 1.30%(7) 0.71%(7) 18%
Year Ended:
10/31/05 $ 55,628 1.39% 1.39% 1.02% 24%
10/31/04 38,864 1.49 1.49 0.68 20
10/31/03 26,429 1.70 1.70 0.47 19
10/31/02 21,317 1.93 1.93 (0.20) 25
10/31/01 16,636 1.93 1.93 (0.25) 27
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $ 10,328 2.35%(7) 2.35%(7) (0.34)%(7) 18%
Year Ended:
10/31/05 $ 4,822 2.51% 2.51% (0.10)% 24%
10/31/04 3,630 2.62 2.62 (0.45) 20
10/31/03 4,020 2.91 2.91 (0.74) 19
10/31/02 4,732 2.91 2.91 (1.18) 25
10/31/01 7,172 2.74 2.74 (1.06) 27
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 3,972 2.09%(7) 2.09%(7) (0.08)%(7) 18%
Year Ended:
10/31/05 $ 1,169 2.29% 2.29% 0.12% 24%
10/31/04 445 2.36 2.36 (0.19) 20
10/31/03 91 2.64 2.64 (0.47) 19
10/31/02(3) 53 2.67(7) 2.67(7) (0.94)(7) 25
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $1,107,417 0.92%(7) 0.92%(7) 1.09%(7) 18%
Year Ended:
10/31/05 $ 780,519 0.95% 0.95% 1.46% 24%
10/31/04 539,471 0.99 0.99 1.18 20
10/31/03 317,493 1.07 1.07 1.10 19
10/31/02 185,137 1.19 1.19 0.54 25
10/31/01 124,886 1.18 1.18 0.50 27
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.97%(7)(8) 1.97%(7)(8) 0.04%(7)(8) 18%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.72%(7)(8) 1.72%(7)(8) 0.29%(7)(8) 18%
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges.
The total returns would have been lower if certain fees had not been waived
and/or expenses reimbursed by the investment advisor or if fees had not
been reduced by credits allowed by the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The Funds commenced selling Class C shares on March 1, 2002.
(4) The Funds commenced selling Class R-1 and Class R-2 shares on March 1,
2006.
100 See Notes to Financial Statements.
Financial Highlights
SHORT TERM INCOME FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
-----------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ---------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $2.31 $0.04 $(0.01) $ 0.03 $(0.04) $-- $(0.04) $2.30 1.36%
Year Ended:
10/31/05 $2.38 $0.08 $(0.07) $ 0.01 $(0.08) $-- $(0.08) $2.31 0.49%
10/31/04 2.39 0.08 (0.01) 0.07 (0.08) -- (0.08) 2.38 2.87
10/31/03 2.34 0.09 0.06 0.15 (0.10) -- (0.10) 2.39 6.28
10/31/02 2.41 0.12 (0.07) 0.05 (0.12) -- (0.12) 2.34 2.18
10/31/01 2.29 0.13 0.12 0.25 (0.13) -- (0.13) 2.41 11.31
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $2.31 $0.03 $(0.01) $ 0.02 $(0.03) $-- $(0.03) $2.30 0.99%
Year Ended:
10/31/05 $2.38 $0.06 $(0.07) $(0.01) $(0.06) $-- $(0.06) $2.31 (0.26)%
10/31/04 2.39 0.06 (0.01) 0.05 (0.06) -- (0.06) 2.38 2.11
10/31/03 2.34 0.07 0.06 0.13 (0.08) -- (0.08) 2.39 5.49
10/31/02 2.41 0.10 (0.07) 0.03 (0.10) -- (0.10) 2.34 1.41
10/31/01 2.29 0.12 0.12 0.24 (0.12) -- (0.12) 2.41 10.52
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $2.31 $0.03 $(0.01) $ 0.02 $(0.03) $-- $(0.03) $2.30 1.00%
Year Ended:
10/31/05 $2.38 $0.06 $(0.07) $(0.01) $(0.06) $-- $(0.06) $2.31 (0.26)%
10/31/04 2.39 0.06 (0.01) 0.05 (0.06) -- (0.06) 2.38 2.10
10/31/03 2.34 0.07 0.06 0.13 (0.08) -- (0.08) 2.39 5.48
10/31/02(3) 2.37 0.07 (0.03) 0.04 (0.07) -- (0.07) 2.34 1.61
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $2.31 $0.05 $(0.01) $ 0.04 $(0.05) $-- $(0.05) $2.30 1.57%
Year Ended:
10/31/05 $2.38 $0.09 $(0.07) $ 0.02 $(0.09) $-- $(0.09) $2.31 0.74%
10/31/04 2.39 0.08 (0.01) 0.07 (0.08) -- (0.08) 2.38 3.13
10/31/03 2.34 0.09 0.06 0.15 (0.10) -- (0.10) 2.39 6.55
10/31/02 2.41 0.13 (0.07) 0.06 (0.13) -- (0.13) 2.34 2.53
10/31/01 2.29 0.15 0.12 0.27 (0.15) -- (0.15) 2.41 11.93
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $2.31 $0.02 $(0.03) $(0.01) $ -- $-- $ -- $2.30 (0.43)%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $2.31 $0.02 $(0.03) $(0.01) $ -- $-- $ -- $2.30 (0.43)%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
--------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO
AVERAGE AVERAGE RATIO OF
NET NET NET
NET ASSETS ASSETS INVESTMENT
ASSETS BEFORE AFTER INCOME TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS(2) ASSETS RATE
--------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $ 32,653 0.95%(7) 0.95%(7) 3.69%(7) 3%
Year Ended:
10/31/05 $ 36,287 0.93% 0.81% 3.36% 13%
10/31/04 54,082 0.92 0.83 3.23 14
10/31/03 71,920 0.97 0.84 3.58 33
10/31/02 28,106 1.09 0.96 5.03 28
10/31/01 18,929 1.15 0.83 5.63 27
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $ 19,725 1.69%(7) 1.69%(7) 2.95%(7) 3%
Year Ended:
10/31/05 $ 23,617 1.70% 1.56% 2.61% 13%
10/31/04 31,812 1.70 1.58 2.48 14
10/31/03 44,310 1.70 1.59 2.83 33
10/31/02 24,621 1.77 1.71 4.28 28
10/31/01 6,595 1.86 1.54 4.92 27
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 7,876 1.67%(7) 1.67%(7) 2.97%(7) 3%
Year Ended:
10/31/05 $ 13,477 1.65% 1.56% 2.61% 13%
10/31/04 18,970 1.66 1.58 2.48 14
10/31/03 17,843 1.65 1.59 2.83 33
10/31/02(3) 5,743 1.68(7) 1.68(7) 4.31(7) 28
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $195,320 0.55%(7) 0.55%(7) 4.09%(7) 3%
Year Ended:
10/31/05 $195,607 0.56% 0.56% 3.61% 13%
10/31/04 168,947 0.58 0.58 3.48 14
10/31/03 129,443 0.59 0.59 3.83 33
10/31/02 89,210 0.61 0.61 5.38 28
10/31/01 110,710 0.59 0.27 6.19 27
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.60%(7)(8) 1.60%(7)(8) 3.04%(7)(8) 3%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.35%(7)(8) 1.35%(7)(8) 3.29%(7)(8) 3%
(5) Per share numbers have been calculated using the average shares method.
(6) Amount represents less than $0.01 per share.
(7) Annualized.
(8) Ratios of expenses and net investment income to average net assets are
hypothetical, based on Class Ashare ratios adjusted for the respective
expenses of the share class.
See Notes to Financial Statements. 101
Financial Highlights
U.S. GOVERNMENT SECURITIES FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
-----------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ---------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $10.53 $0.22 $(0.13) $ 0.09 $(0.24) $-- $(0.24) $10.38 0.82%
Year Ended:
10/31/05 $10.88 $0.41(5) $(0.30) $ 0.11 $(0.46) $-- $(0.46) $10.53 1.02%
10/31/04 10.89 0.40(5) 0.05 0.45 (0.46) -- (0.46) 10.88 4.26
10/31/03 11.19 0.40(5) (0.19) 0.21 (0.51) -- (0.51) 10.89 1.94
10/31/02 11.20 0.54 0.04 0.58 (0.59) -- (0.59) 11.19 5.37
10/31/01 10.55 0.62 0.65 1.27 (0.62) -- (0.62) 11.20 12.39
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $10.52 $0.18 $(0.13) $ 0.05 $(0.20) $-- $(0.20) $10.37 0.45%
Year Ended:
10/31/05 $10.87 $0.33(5) $(0.30) $ 0.03 $(0.38) $-- $(0.38) $10.52 0.28%
10/31/04 10.88 0.32(5) 0.05 0.37 (0.38) -- (0.38) 10.87 3.50
10/31/03 11.18 0.32(5) (0.19) 0.13 (0.43) -- (0.43) 10.88 1.20
10/31/02 11.19 0.46 0.04 0.50 (0.51) -- (0.51) 11.18 4.62
10/31/01 10.54 0.54 0.65 1.19 (0.54) -- (0.54) 11.19 11.59
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $10.51 $0.18 $(0.13) $ 0.05 $(0.20) $-- $(0.20) $10.36 0.46%
Year Ended:
10/31/05 $10.86 $0.33(5) $(0.30) $ 0.03 $(0.38) $-- $(0.38) $10.51 0.29%
10/31/04 10.87 0.32(5) 0.05 0.37 (0.38) -- (0.38) 10.86 3.53
10/31/03 11.18 0.32(5) (0.20) 0.12 (0.43) -- (0.43) 10.87 1.12
10/31/02(3) 11.00 0.33 0.18 0.51 (0.33) -- (0.33) 11.18 4.74
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $10.53 $0.24 $(0.13) $ 0.11 $(0.26) $-- $(0.26) $10.38 1.01%
Year Ended:
10/31/05 $10.88 $0.45(5) $(0.30) $ 0.15 $(0.50) $-- $(0.50) $10.53 1.41%
10/31/04 10.89 0.44(5) 0.05 0.49 (0.50) -- (0.50) 10.88 4.65
10/31/03 11.19 0.44(5) (0.19) 0.25 (0.55) -- (0.55) 10.89 2.32
10/31/02 11.20 0.58 0.04 0.62 (0.63) -- (0.63) 11.19 5.77
10/31/01 10.55 0.66 0.65 1.31 (0.66) -- (0.66) 11.20 12.81
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $10.55 $0.08 $(0.25) $(0.17) $ -- $-- $ -- $10.38 (1.61)%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $10.55 $0.08 $(0.25) $(0.17) $ -- $-- $ -- $10.38 (1.61)%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO
AVERAGE AVERAGE RATIO OF
NET NET NET
NET ASSETS ASSETS INVESTMENT
ASSETS BEFORE AFTER INCOME TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 00S) WAIVERS WAIVERS(2) ASSETS RATE
---------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $ 106,736 0.90%(6) 0.90%(6) 4.20%(6) 6%
Year Ended:
10/31/05 $ 120,615 0.92% 0.92% 3.84% 34%
10/31/04 134,896 0.93 0.93 3.64 30
10/31/03 176,859 0.93 0.93 3.59 62
10/31/02 196,222 0.96 0.96 4.91 48
10/31/01 174,047 0.95 0.95 5.71 30
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $ 101,354 1.64%(6) 1.64%(6) 3.46%(6) 6%
Year Ended:
10/31/05 $ 122,147 1.65% 1.65% 3.11% 34%
10/31/04 157,900 1.65 1.65 2.92 30
10/31/03 251,153 1.66 1.66 2.86 62
10/31/02 271,440 1.68 1.68 4.19 48
10/31/01 128,155 1.67 1.67 4.99 30
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 7,669 1.62%(6) 1.62%(6) 3.48%(6) 6%
Year Ended:
10/31/05 $ 6,775 1.64% 1.64% 3.12% 34%
10/31/04 6,279 1.64 1.64 2.93 30
10/31/03 13,354 1.64 1.64 2.88 62
10/31/02(3) 11,634 1.63(6) 1.63(6) 4.24(6) 48
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $1,560,140 0.52%(6) 0.52%(6) 4.58%(6) 6%
Year Ended:
10/31/05 $1,642,617 0.54% 0.54% 4.22% 34%
10/31/04 1,260,104 0.55 0.55 4.02 30
10/31/03 658,676 0.57 0.57 3.95 62
10/31/02 365,912 0.58 0.58 5.29 48
10/31/01 301,656 0.57 0.57 6.09 30
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.57%(6)(7) 1.57%(6)(7) 3.53%(6)(7) 6%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.32%(6)(7) 1.32%(6)(7) 3.78%(6)(7) 6%
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges.
The total returns would have been lower if certain fees had not been waived
and/or expenses reimbursed by the investment advisor or if fees had not
been reduced by credits allowed by the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The Funds commenced selling Class C shares on March 1, 2002.
(4) The Funds commenced selling Class R-1 and R-2 shares on March 1, 2006.
102 See Notes to Financial Statements.
Financial Highlights
INCOME FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
-----------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ---------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $9.05 $0.24 $(0.08) $ 0.16 $(0.25) $-- $(0.25) $8.96 1.68%
Year Ended:
10/31/05 $9.46 $0.45 $(0.38) $ 0.07 $(0.48) $-- $(0.48) $9.05 0.75%
10/31/04 9.35 0.46 0.15 0.61 (0.50) -- (0.50) 9.46 6.68
10/31/03 9.02 0.51 0.38 0.89 (0.56) -- (0.56) 9.35 10.10
10/31/02 9.32 0.60 (0.28) 0.32 (0.62) -- (0.62) 9.02 3.63
10/31/01 8.90 0.62 0.43 1.05 (0.63) -- (0.63) 9.32 12.21
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $9.08 $0.20 $(0.09) $ 0.11 $(0.21) $-- $(0.21) $8.98 1.19%
Year Ended:
10/31/05 $9.49 $0.38 $(0.38) $ 0.00 $(0.41) $-- $(0.41) $9.08 0.02%
10/31/04 9.37 0.39 0.16 0.55 (0.43) -- (0.43) 9.49 6.03
10/31/03 9.04 0.44 0.38 0.82 (0.49) -- (0.49) 9.37 9.31
10/31/02 9.35 0.54 (0.29) 0.25 (0.56) -- (0.56) 9.04 2.79
10/31/01 8.92 0.56 0.44 1.00 (0.57) -- (0.57) 9.35 11.52
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $9.08 $0.20 $(0.09) $ 0.11 $(0.21) $-- $(0.21) $8.98 1.18%
Year Ended:
10/31/05 $9.49 $0.38 $(0.38) $ 0.00 $(0.41) $-- $(0.41) $9.08 0.01%
10/31/04 9.37 0.39 0.16 0.55 (0.43) -- (0.43) 9.49 6.02
10/31/03 9.04 0.45 0.38 0.83 (0.50) -- (0.50) 9.37 9.33
10/31/02(3) 9.21 0.37 (0.17) 0.20 (0.37) -- (0.37) 9.04 2.25
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $9.07 $0.25 $(0.09) $ 0.16 $(0.26) $-- $(0.26) $8.97 1.75%
Year Ended:
10/31/05 $9.48 $0.49 $(0.38) $ 0.11 $(0.52) $-- $(0.52) $9.07 1.13%
10/31/04 9.36 0.50 0.16 0.66 (0.54) -- (0.54) 9.48 7.18
10/31/03 9.03 0.55 0.38 0.93 (0.60) -- (0.60) 9.36 10.51
10/31/02 9.34 0.64 (0.29) 0.35 (0.66) -- (0.66) 9.03 3.94
10/31/01 8.91 0.66 0.44 1.10 (0.67) -- (0.67) 9.34 12.78
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $9.11 $0.09 $(0.24) $(0.15) $ -- $-- $ -- $8.96 (1.65)%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $9.11 $0.09 $(0.24) $(0.15) $ -- $-- $ -- $8.96 (1.65)%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO
AVERAGE AVERAGE RATIO OF
NET NET NET
NET ASSETS ASSETS INVESTMENT
ASSETS BEFORE AFTER INCOME TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 00S) WAIVERS WAIVERS ASSETS RATE
-------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $147,116 0.89%(6) 0.89%(6) 5.28%(6) 12%
Year Ended:
10/31/05 $147,521 0.91% 0.91% 4.83% 20%
10/31/04 147,695 0.92 0.92 4.90 24
10/31/03 153,654 0.94 0.94 5.42 33
10/31/02 130,512 0.97 0.97 6.61 20
10/31/01 120,508 0.97 0.97 6.86 35
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $111,278 1.64%(6) 1.64%(6) 4.53%(6) 12%
Year Ended:
10/31/05 $128,067 1.65% 1.65% 4.09% 20%
10/31/04 152,065 1.65 1.65 4.17 24
10/31/03 194,396 1.65 1.65 4.71 33
10/31/02 142,186 1.68 1.68 5.90 20
10/31/01 72,472 1.69 1.69 6.14 35
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 10,730 1.65%(6) 1.65%(6) 4.52%(6) 12%
Year Ended:
10/31/05 $ 10,761 1.66% 1.66% 4.08% 20%
10/31/04 11,580 1.65 1.65 4.17 24
10/31/03 15,274 1.63 1.63 4.73 33
10/31/02(3) 7,710 1.62(6) 1.62(6) 5.96(6) 20
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $985,759 0.53%(6) 0.53%(6) 5.64%(6) 12%
Year Ended:
10/31/05 $903,915 0.54% 0.54% 5.20% 20%
10/31/04 834,726 0.55 0.55 5.27 24
10/31/03 679,139 0.56 0.56 5.80 33
10/31/02 487,376 0.56 0.56 7.02 20
10/31/01 387,998 0.56 0.56 7.27 35
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.58%(6)(7) 1.58%(6)(7) 4.59%(6)(7) 12%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.33%(6)(7) 1.33%(6)(7) 4.84%(6)(7) 12%
(5) Per share numbers have been calculated using the average shares method.
(6) Annualized.
(7) Ratios of expenses and net investment income to average net assets are
hypothetical, based on Class A share ratios adjusted for the respective
expenses of the share class.
See Notes to Financial Statements. 103
Financial Highlights
HIGH YIELD FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
-----------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ---------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $8.23 $0.30(5) $ 0.37 $ 0.67 $(0.28) $-- $(0.28) $8.62 8.23%
Year Ended:
10/31/05 $8.28 $0.56 $(0.03) $ 0.53 $(0.58) $-- $(0.58) $8.23 6.56%
10/31/04 7.88 0.58 0.43 1.01 (0.61) -- (0.61) 8.28 13.23
10/31/03 6.63 0.61(5) 1.31 1.92 (0.67) -- (0.67) 7.88 30.13
10/31/02 7.44 0.71 (0.72) (0.01) (0.80) -- (0.80) 6.63 (0.48)
10/31/01 8.50 0.84 (1.00) (0.16) (0.90) -- (0.90) 7.44 (1.97)
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $8.27 $0.27(5) $ 0.37 $ 0.64 $(0.25) $-- $(0.25) $8.66 7.80%
Year Ended:
10/31/05 $8.32 $0.50 $(0.03) $ 0.47 $(0.52) $-- $(0.52) $8.27 5.75%
10/31/04 7.91 0.52 0.44 0.96 (0.55) -- (0.55) 8.32 12.50
10/31/03 6.66 0.56(5) 1.31 1.87 (0.62) -- (0.62) 7.91 29.08
10/31/02 7.47 0.66 (0.72) (0.06) (0.75) -- (0.75) 6.66 (1.17)
10/31/01 8.54 0.78 (1.01) (0.23) (0.84) -- (0.84) 7.47 (2.72)
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $8.27 $0.27(5) $ 0.37 $ 0.64 $(0.25) $-- $(0.25) $8.66 7.81%
Year Ended:
10/31/05 $8.32 $0.50 $(0.03) $ 0.47 $(0.52) $-- $(0.52) $8.27 5.77%
10/31/04 7.91 0.52 0.44 0.96 (0.55) -- (0.55) 8.32 12.51
10/31/03 6.67 0.56(5) 1.30 1.86 (0.62) -- (0.62) 7.91 29.08
10/31/02(3) 7.55 0.46 (0.86) (0.40) (0.48) -- (0.48) 6.67 (5.66)
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $8.22 $0.31(5) $ 0.37 $ 0.68 $(0.29) $-- $(0.29) $8.61 8.42%
Year Ended:
10/31/05 $8.27 $0.58 $(0.03) $ 0.55 $(0.60) $-- $(0.60) $8.22 6.91%
10/31/04 7.86 0.60 0.44 1.04 (0.63) -- (0.63) 8.27 13.75
10/31/03 6.62 0.63(5) 1.30 1.93 (0.69) -- (0.69) 7.86 30.44
10/31/02 7.43 0.73 (0.72) 0.01 (0.82) -- (0.82) 6.62 (0.15)
10/31/01 8.48 0.87 (0.99) (0.12) (0.93) -- (0.93) 7.43 (1.49)
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $8.57 $0.10(5) $(0.01)(6) $ 0.09 $(0.04) $-- $(0.04) $8.62 1.08%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $8.57 $0.13(5) $(0.08)(6) $ 0.05 $ -- $-- $ -- $8.62 0.58%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO
AVERAGE AVERAGE RATIO OF
NET NET NET
NET ASSETS ASSETS INVESTMENT
ASSETS BEFORE AFTER INCOME TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS(2) ASSETS RATE
--------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $183,966 0.92%(7) 0.90%(7) 7.21%(7) 53%
Year Ended:
10/31/05 $111,164 0.92% 0.92% 6.76% 94%
10/31/04 85,190 0.93 0.93 7.11 82
10/31/03 48,618 0.97 0.97 8.24 61
10/31/02 13,563 1.03 1.03 9.72 60
10/31/01 9,035 1.09 1.08 10.47 27
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $ 75,410 1.69%(7) 1.67%(7) 6.44%(7) 53%
Year Ended:
10/31/05 $ 73,667 1.68% 1.68% 6.00% 94%
10/31/04 80,036 1.69 1.69 6.35 82
10/31/03 83,665 1.73 1.73 7.48 61
10/31/02 44,004 1.78 1.78 8.97 60
10/31/01 35,391 1.78 1.77 9.78 27
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 46,797 1.67%(7) 1.65%(7) 6.46%(7) 53%
Year Ended:
10/31/05 $ 38,475 1.66% 1.66% 6.02% 94%
10/31/04 33,318 1.68 1.68 6.36 82
10/31/03 24,540 1.71 1.71 7.50 61
10/31/02(3) 2,556 1.78(7) 1.78(7) 8.97(7) 60
CLASS I SHARES
Six Months Ended (unaudited):
4/30/06 $581,595 0.59%(7) 0.57%(7) 7.54%(7) 53%
Year Ended:
10/31/05 $588,409 0.59% 0.59% 7.09% 94%
10/31/04 526,095 0.61 0.61 7.43 82
10/31/03 424,781 0.64 0.64 8.57 61
10/31/02 244,937 0.68 0.68 10.07 60
10/31/01 201,385 0.69 0.68 10.87 27
CLASS R-1 SHARES
Period Ended (unaudited):
4/30/06(4) $ 44 1.64%(7) 1.62%(7) 6.49%(7) 53%
CLASS R-2 SHARES
Period Ended (unaudited):
4/30/06(4) $ -- 1.39%(7)(9) 1.37%(7)(9) 6.74%(7)(9) 53%
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges.
The total returns would have been lower if certain fees had not been waived
and/or expenses reimbursed by the investment advisor or if fees had not
been reduced by credits allowed by the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The Funds commenced selling Class C shares on March 1, 2002.
(4) The High Yield Fund commenced selling Class R-1 and R-2 shares on March 1,
2006.
104 See Notes to Financial Statements.
Financial Highlights
TAX-EXEMPT BOND FUND
For a Fund share outstanding throughout each period.
INCOME FROM
INVESTMENT OPERATIONS
-----------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ---------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $7.70 $0.16 $(0.00)(8) $0.16 $(0.16) $(0.15) $(0.31) $7.55 2.13%
Year Ended:
10/31/05 $7.95 $0.33 $(0.16) $0.17 $(0.33) $(0.09) $(0.42) $7.70 2.19%
10/31/04 7.96 0.33 0.08 0.41 (0.33) (0.09) (0.42) 7.95 5.35
10/31/03 7.95 0.34 0.08 0.42 (0.34) (0.07) (0.41) 7.96 5.31
10/31/02 7.93 0.35 0.03 0.38 (0.35) (0.01) (0.36) 7.95 5.02
10/31/01 7.55 0.37 0.38 0.75 (0.37) -- (0.37) 7.93 10.16
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $7.70 $0.13 $(0.00)(8) $0.13 $(0.13) $(0.15) $(0.28) $7.55 1.75%
Year Ended:
10/31/05 $7.95 $0.27 $(0.16) $0.11 $(0.27) $(0.09) $(0.36) $7.70 1.43%
10/31/04 7.96 0.27 0.08 0.35 (0.27) (0.09) (0.36) 7.95 4.57
10/31/03 7.95 0.28 0.08 0.36 (0.28) (0.07) (0.35) 7.96 4.53
10/31/02 7.93 0.29 0.03 0.32 (0.29) (0.01) (0.30) 7.95 4.25
10/31/01 7.55 0.31 0.38 0.69 (0.31) -- (0.31) 7.93 9.35
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $7.70 $0.13 $(0.00)(8) $0.13 $(0.13) $(0.15) $(0.28) $7.55 1.72%
Year Ended:
10/31/05 $7.95 $0.27 $(0.16) $0.11 $(0.27) $(0.09) $(0.36) $7.70 1.41%
10/31/04 7.96 0.27 0.08 0.35 (0.27) (0.09) (0.36) 7.95 4.58
10/31/03 7.95 0.28 0.08 0.36 (0.28) (0.07) (0.35) 7.96 4.54
10/31/02(3) 7.83 0.20 0.12 0.32 (0.20) -- (0.20) 7.95 4.06
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO
AVERAGE AVERAGE RATIO OF
NET NET NET
NET ASSETS ASSETS INVESTMENT
ASSETS BEFORE AFTER INCOME TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS(2) ASSETS RATE
--------- ---------- ---------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $169,423 0.86%(7) 0.86%(7) 4.32%(7) 11%
Year Ended:
10/31/05 $175,146 0.87% 0.87% 4.22% 28%
10/31/04 184,711 0.90 0.90 4.22 25
10/31/03 207,433 0.88 0.88 4.20 47
10/31/02 213,673 0.90 0.90 4.49 46
10/31/01 219,883 0.89 0.89 4.75 44
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $ 26,964 1.61%(7) 1.61%(7) 3.57%(7) 11%
Year Ended:
10/31/05 $ 30,073 1.62% 1.62% 3.47% 28%
10/31/04 35,433 1.65 1.65 3.47 25
10/31/03 45,061 1.62 1.62 3.46 47
10/31/02 47,308 1.64 1.64 3.75 46
10/31/01 43,978 1.63 1.63 4.01 44
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 2,752 1.65%(7) 1.65%(7) 3.53%(7) 11%
Year Ended:
10/31/05 $ 2,360 1.63% 1.63% 3.46% 28%
10/31/04 3,641 1.65 1.65 3.47 25
10/31/03 4,332 1.61 1.61 3.47 47
10/31/02(3) 2,395 1.61(7) 1.61(7) 3.78(7) 46
(5) Per share numbers have been calculated using the average share method.
(6) The amount shown may not accord with the change in aggregate gains and
losses of portfolio securities due to the timing of sales and redemptions
of Fund shares.
(7) Annualized.
(8) Amount represents less than $0.01 per share.
(9) Ratios of expenses and net investment income to average net assets are
hypothetical, based on Class A share ratios adjusted for the respective
expenses of the share class.
See Notes to Financial Statements. 105
Financial Highlights
CALIFORNIA MUNICIPAL FUND
For a Fund share outstanding throughout each period.
INCOME FROM
INVESTMENT OPERATIONS
-----------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ---------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $11.24 $0.24 $(0.01) $0.23 $(0.24) $(0.14) $(0.38) $11.09 2.09%
Year Ended:
10/31/05 $11.42 $0.48 $(0.15) $0.33 $(0.48) $(0.03) $(0.51) $11.24 2.90%
10/31/04 11.22 0.49 0.20 0.69 (0.49) -- (0.49) 11.42 6.25
10/31/03 11.35 0.47 (0.06) 0.41 (0.47) (0.07) (0.54) 11.22 3.69
10/31/02 11.34 0.50 0.00(4) 0.50 (0.49) -- (0.49) 11.35 4.57
10/31/01 10.81 0.53 0.53 1.06 (0.53) -- (0.53) 11.34 9.99
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $11.24 $0.20 $(0.01) $0.19 $(0.20) $(0.14) $(0.34) $11.09 1.71%
Year Ended:
10/31/05 $11.42 $0.39 $(0.15) $0.24 $(0.39) $(0.03) $(0.42) $11.24 2.13%
10/31/04 11.22 0.40 0.20 0.60 (0.40) -- (0.40) 11.42 5.47
10/31/03 11.35 0.38 (0.06) 0.32 (0.38) (0.07) (0.45) 11.22 2.92
10/31/02 11.34 0.42 0.00(4) 0.42 (0.41) -- (0.41) 11.35 3.79
10/31/01 10.81 0.44 0.53 0.97 (0.44) -- (0.44) 11.34 9.19
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $11.24 $0.20 $(0.01) $0.19 $(0.20) $(0.14) $(0.34) $11.09 1.70%
Year Ended:
10/31/05 $11.42 $0.39 $(0.15) $0.24 $(0.39) $(0.03) $(0.42) $11.24 2.13%
10/31/04 11.22 0.40 0.20 0.60 (0.40) -- (0.40) 11.42 5.46
10/31/03 11.35 0.38 (0.06) 0.32 (0.38) (0.07) (0.45) 11.22 2.92
10/31/02(3) 11.20 0.28 0.14 0.42 (0.27) -- (0.27) 11.35 3.77
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
--------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO
AVERAGE AVERAGE RATIO OF
NET NET NET
NET ASSETS ASSETS INVESTMENT
ASSETS BEFORE AFTER INCOME TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS (2) ASSETS RATE
--------- ---------- ----------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $249,169 0.84%(5) 0.84%(5) 4.29%(5) 15%
Year Ended:
10/31/05 $241,879 0.84% 0.84% 4.19% 26%
10/31/04 232,239 0.85 0.85 4.32 27
10/31/03 252,511 0.85 0.85 4.14 34
10/31/02 286,095 0.86 0.86 4.39 48
10/31/01 291,132 0.86 0.85 4.74 52
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $147,670 1.59%(5) 1.59%(5) 3.54%(5) 15%
Year Ended:
10/31/05 $162,534 1.59% 1.59% 3.44% 26%
10/31/04 195,930 1.59 1.59 3.58 27
10/31/03 255,445 1.59 1.59 3.40 34
10/31/02 295,662 1.60 1.60 3.65 48
10/31/01 237,594 1.59 1.58 4.01 52
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $3,968 1.60%(5) 1.60%(5) 3.53%(5) 15%
Year Ended:
10/31/05 $4,641 1.59% 1.59% 3.44% 26%
10/31/04 5,275 1.60 1.60 3.57 27
10/31/03 8,193 1.59 1.59 3.40 34
10/31/02(3) 6,665 1.58(5) 1.58(5) 3.67(5) 48
(1) Total return is not annualized for periods of less than one year and does
not reflect any applicable sales charges.
The total returns would have been lower if certain fees had not been waived
and/or expenses reimbursed by the investment advisor or if fees had not
been reduced by credits allowed by the custodian.
(2) Ratio of operating expenses to average net assets includes expenses paid
indirectly through custodian credits.
(3) The Funds commenced selling Class C shares on March 1, 2002.
106 See Notes to Financial Statements.
Financial Highlights
CALIFORNIA INSURED INTERMEDIATE MUNICIPAL FUND
For a Fund share outstanding throughout each period.
INCOME/(LOSS) FROM
INVESTMENT OPERATIONS
-----------------------------------
NET LESS DISTRIBUTIONS
REALIZED ----------------------------------------
NET AND DISTRIBUTIONS NET
ASSET UNREALIZED DIVIDENDS FROM NET ASSET
VALUE NET GAIN/(LOSS) TOTAL FROM FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT INVESTMENT CAPITAL TOTAL END OF TOTAL
OF PERIOD INCOME INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS PERIOD RETURN(1)
--------- ---------- ----------- ---------- ---------- ------------- ------------- ------ ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $10.85 $0.18 $(0.05) $ 0.13 $(0.18) $(0.02) $(0.20) $10.78 1.22%
Year Ended:
10/31/05 $11.14 $0.34 $(0.29) $ 0.05 $(0.34) $(0.00)(4) $(0.34) $10.85 0.52%
10/31/04 11.14 0.33 0.10 0.43 (0.33) (0.10) (0.43) 11.14 4.02
10/31/03 11.08 0.35 0.12 0.47 (0.35) (0.06) (0.41) 11.14 4.29
10/31/02 10.98 0.39 0.15 0.54 (0.39) (0.05) (0.44) 11.08 5.12
10/31/01 10.58 0.44 0.49 0.93 (0.44) (0.09) (0.53) 10.98 9.00
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $10.85 $0.14 $(0.05) $ 0.09 $(0.14) $(0.02) $(0.16) $10.78 0.84%
Year Ended:
10/31/05 $11.14 $0.26 $(0.29) $(0.03) $(0.26) $(0.00)(4) $(0.26) $10.85 (0.24)%
10/31/04 11.14 0.25 0.10 0.35 (0.25) (0.10) (0.35) 11.14 3.24
10/31/03 11.08 0.27 0.12 0.39 (0.27) (0.06) (0.33) 11.14 3.51
10/31/02 10.98 0.31 0.15 0.46 (0.31) (0.05) (0.36) 11.08 4.32
10/31/01 10.58 0.36 0.49 0.85 (0.36) (0.09) (0.45) 10.98 8.19
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $10.85 $0.14 $(0.05) $ 0.09 $(0.14) $(0.02) $(0.16) $10.78 0.85%
Year Ended:
10/31/05 $11.14 $0.26 $(0.29) $(0.03) $(0.26) $(0.00)(4) $(0.26) $10.85 (0.24)%
10/31/04 11.14 0.25 0.10 0.35 (0.25) (0.10) (0.35) 11.14 3.24
10/31/03 11.08 0.27 0.12 0.39 (0.27) (0.06) (0.33) 11.14 3.50
10/31/02(3) 10.90 0.21 0.18 0.39 (0.21) -- (0.21) 11.08 3.58
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------------------
RATIO OF RATIO OF
EXPENSES EXPENSES
TO TO
AVERAGE AVERAGE RATIO OF
NET NET NET
NET ASSETS ASSETS INVESTMENT
ASSETS BEFORE AFTER INCOME TO
END OF REIMBURSE- REIMBURSE- AVERAGE PORTFOLIO
PERIOD MENTS/ MENTS/ NET TURNOVER
(IN 000S) WAIVERS WAIVERS (2) ASSETS RATE
--------- ---------- ----------- ---------- ---------
CLASS A SHARES
Six Months Ended (unaudited):
4/30/06 $61,597 0.87%(5) 0.86%(5) 3.29%(5) 16%
Year Ended:
10/31/05 $65,667 0.87% 0.87% 3.11% 27%
10/31/04 65,772 0.86 0.85 3.02 37
10/31/03 75,231 0.86 0.77 3.15 65
10/31/02 57,102 0.89 0.70 3.59 28
10/31/01 39,996 0.92 0.73 4.09 23
CLASS B SHARES
Six Months Ended (unaudited):
4/30/06 $52,991 1.63%(5) 1.62%(5) 2.53%(5) 16%
Year Ended:
10/31/05 $59,562 1.63% 1.63% 2.35% 27%
10/31/04 71,502 1.62 1.61 2.26 37
10/31/03 93,448 1.62 1.53 2.39 65
10/31/02 89,240 1.65 1.46 2.83 28
10/31/01 51,525 1.67 1.48 3.34 23
CLASS C SHARES
Six Months Ended (unaudited):
4/30/06 $ 6,837 1.62%(5) 1.61%(5) 2.54%(5) 16%
Year Ended:
10/31/05 $ 7,476 1.63% 1.63% 2.35% 27%
10/31/04 8,763 1.62 1.61 2.26 37
10/31/03 10,317 1.62 1.53 2.39 65
10/31/02(3) 7,953 1.64(5) 1.45(5) 2.84(5) 28
(4) Amount represents less than $0.01 per share.
(5) Annualized.
See Notes to Financial Statements. 107
Notes to Financial Statements (unaudited)
WM GROUP OF FUNDS
1. ORGANIZATION AND BUSINESS
WM Trust I ("Trust I") and WM Trust II ("Trust II") (collectively, the "Trusts")
were organized as Massachusetts business trusts on September 19, 1997 and
February 22, 1989, respectively. The Trusts are each registered under the
Investment Company Act of 1940, as amended ("1940 Act"), as open-end management
investment companies. The Trusts consist of 17 funds, 16 of which (each a "Fund"
and collectively, the "Funds") are presented in this report and are as follows:
TRUST I TRUST II
EQUITY FUNDS EQUITY FUNDS
REIT Fund Growth Fund
Equity Income Fund Small Cap Growth Fund
Growth & Income Fund International Growth Fund
West Coast Equity Fund
Mid Cap Stock Fund
Small Cap Value Fund
FIXED-INCOME FUNDS FIXED-INCOME FUND
U.S. Government Securities Fund Short Term Income Fund
Income Fund
High Yield Fund
MUNICIPAL FUND MUNICIPAL FUNDS
Tax-Exempt Bond Fund California Municipal Fund
California Insured Intermediate Municipal Fund
WM Advisors, Inc. (the "Advisor") serves as investment advisor to the Trusts.
The Advisor is a wholly owned subsidiary of Washington Mutual, Inc. ("Washington
Mutual"), a publicly owned financial services company.
The Trusts are authorized to issue an unlimited number of shares of beneficial
interest, each without par value. Each of the Fixed-Income Funds and the Equity
Funds offer six classes of shares: Class A, Class B, Class C, Class I, Class
R-1, and Class R-2 shares. Each of the Municipal Funds currently offer Class
A shares, Class B shares and Class C shares. Class A shares of the Funds are
generally subject to an initial sales charge at the time of purchase. Certain
Class A shares purchased without an initial sales charge may be subject to a
contingent deferred sales charge ("CDSC") if redeemed within eighteen months
from the date of purchase. Class B shares are not subject to an initial sales
charge although they are generally subject to a CDSC if redeemed within five
years from the date of purchase. Class C shares are not subject to an initial
sales charge although they are subject to a CDSC if redeemed within one year
from the date of purchase. In addition, redemptions from the International
Growth Fund, including exchange redemptions, within 90 days of purchase are
subject to a redemption fee equal to 2.00% of the redemption proceeds, which are
retained by the Fund. Class I shares are sold exclusively to the various
investment portfolios of the WM Strategic Asset Management Portfolios, LLC (the
"Portfolios"), an affiliated open-end management investment company, and
affiliates of Washington Mutual and are not available for direct purchase by
investors. Class R-1 and Class R-2 shares are only offered through retirement
plans and are not available for direct purchase by investors. Class I, Class
R-1, and Class R-2 shares are not subject to an initial sales charge, CDSC or
redemption fee.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies, in conformity
with accounting principles generally accepted in the United States of America
("generally accepted accounting principles"), which are consistently followed by
the Funds in the preparation of their financial statements.
108
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
PORTFOLIO VALUATION:
Securities that are primarily traded on a U.S. exchange (excluding securities
traded through the NASDAQ National Market System, which are valued at the NASDAQ
official closing price) are valued at the last reported sales price from that
exchange or, if there were no sales during the day (and no official closing
price on such day), at the mean of the current day's bid and asked prices.
Securities traded only on over-the-counter markets (other than the NASDAQ
National Market System and the U.S. Government Securities System) are valued at
the mean of the current day's bid and asked prices.
The value of a foreign security is determined in its functional currency as of
the close of trading on the foreign exchange on which it is traded or at the
close of the New York Stock Exchange, if that is earlier, or if there has been
movement in the U.S. market and/or other economic indicators that exceed a
specified threshold, the foreign security is fair valued. The value is then
converted into its U.S. dollar equivalent using prevailing exchange rates on the
day the value of the foreign security is determined.
Options are generally valued at the last sale price or, in the absence of a last
sale price, at the mean of the current day's bid and asked prices. The value of
a futures contract equals the unrealized gain or loss on the contract, which is
determined by marking the contract to the current settlement price for a like
contract acquired on the day on which the futures contract is being valued.
Debt securities of U.S. issuers (other than short-term investments), including
municipal securities, are valued by one or more independent pricing services
retained by the Trusts. When, in the judgment of a pricing service, market
quotations for these securities are readily available, they are valued at the
mean between the quoted bid and asked prices. Short-term debt securities that
mature in 60 days or less are valued at amortized cost, which approximates
market value.
Securities for which market quotations are not readily available are valued at
fair value as determined by, or under the direction of, the Funds' Board of
Trustees, which may rely on the assistance of one or more pricing services.
REPURCHASE AGREEMENTS:
Each Fund may enter into repurchase agreement transactions. A repurchase
agreement is a purchase of an underlying debt obligation subject to an agreement
by the seller to repurchase the obligation at an agreed upon price and time. It
is each Fund's policy that its custodian take possession of the underlying
collateral securities. The fair value of the collateral is at all times at least
equal to the total amount of the repurchase obligation. In the event of
counterparty default, the Fund would seek to use the collateral to offset losses
incurred. There is potential loss to the Fund in the event the Fund is delayed
or prevented from exercising its right to dispose of the collateral securities,
including the risk of a possible decline in the value of the underlying
securities during the period while the Fund seeks to assert its rights. The
Advisor, acting under the supervision of the Board of Trustees of the Trusts,
reviews the value of the collateral and the creditworthiness of those banks and
broker/dealers with whom each Fund enters into repurchase agreements.
FUTURES CONTRACTS:
Certain Funds may enter into futures transactions. The underlying value of a
futures contract is incorporated within the unrealized
appreciation/(depreciation) shown in the Portfolio of Investments under the
caption "Futures Contracts."
Upon entering into a futures contract, the Fund is required to deposit with the
broker an amount of cash or cash equivalents equal to a certain percentage of
the contract amount (known as an initial margin deposit). Subsequent payments
(known as variation margins) are made or received by the Fund each day,
depending on the daily fluctuation of the value of the contract. The daily
changes in contract value are recorded as unrealized gains or losses, and the
Fund recognizes a realized gain or loss when the contract is closed. Should
market conditions change unexpectedly, the Funds may not achieve the anticipated
benefits of the futures contracts and may realize a loss. The use of futures
transactions involves the risk of imperfect correlation in movements in the
price of futures contracts, interest rates and the underlying hedged assets.
109
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
PURCHASED OPTION CONTRACTS:
Certain Funds may enter into put and call option contracts. These Funds may use
option contracts to manage their exposure to the stock and bond markets and to
fluctuations in interest rates and currency values. Upon entering into a put or
call option, the premium paid is recorded as an investment. The daily changes in
contract value are recorded as unrealized gains or losses. When a purchased
option expires, the Fund will realize a loss in the amount of the cost of the
option. When the Fund enters into a closing sale transaction, the Fund will
realize a gain or loss depending on whether the sales proceeds from the closing
sale transaction are greater or less than the cost of the option plus related
transaction costs. When the Fund exercises a put option, the Fund will realize a
gain or loss from the sale of the underlying security and the proceeds from such
sale will be decreased by the premium originally paid. When the Fund exercises a
call option, the cost of the security, which the Fund purchases upon exercise,
will be increased by the premium originally paid. The risk associated with
purchasing options is limited to the premium originally paid.
FOREIGN CURRENCY:
The books and records of the Funds are maintained in U.S. dollars. Foreign
currencies, investments and other assets and liabilities are translated into
U.S. dollars on a daily basis using prevailing exchange rates. Purchases and
sales of investment securities, income and expenses are translated on the
respective dates of such transactions.
Unrealized gains and losses, not relating to securities, which result from
changes in foreign currency exchange rates, have been included in unrealized
appreciation/(depreciation) of investments. Unrealized gains and losses of
securities, which result from changes in foreign currency exchange rates as well
as changes in market prices of securities, have been included in unrealized
appreciation/(depreciation) of investments. Net realized foreign currency gains
and losses, which result from changes in exchange rates between trade date and
settlement date on investment transactions as well as the difference between the
amounts of interest and dividends recorded on the books of the Funds and the
amount actually received, have been included in realized gains/(losses) on
investment transactions. Foreign currency gains and losses, which result from
fluctuations in exchange rates between the initial purchase trade date and
subsequent sale trade date, have been included in realized gains/(losses) on
investment transactions.
FORWARD FOREIGN CURRENCY CONTRACTS:
Certain Funds may enter into forward foreign currency contracts. Forward foreign
currency contracts are agreements to exchange one currency for another at a
future date and at a specified price. These Funds may use forward foreign
currency contracts to facilitate transactions in foreign securities and to
manage the Funds'foreign currency exposure. These contracts are valued daily,
and a Fund's net equity therein, representing unrealized gain or loss on the
contracts as measured by the difference between the forward foreign exchange
rates at the dates of entry into the contracts and the forward rates at the
reporting date, is included in the "Statements of Assets and Liabilities".
Realized and unrealized gains and losses are included in the "Statements of
Operations". Due to the risks, the Funds could incur losses up to the entire
contract amount, which may exceed the net unrealized value shown in the
"Statements of Assets and Liabilities".
ILLIQUID INVESTMENTS:
Each Fund may invest a portion of its net assets in securities that are not
readily marketable, including: (1) repurchase agreements with maturities greater
than seven calendar days; (2) time deposits maturing in more than seven calendar
days; (3) certain futures contracts and options; (4) certain variable rate
demand notes having a demand period of more than seven calendar days; (5)
securities, the disposition of which are restricted under federal securities
laws, excluding certain Rule 144A securities, as defined in the following
paragraph; and (6) certain over-the-counter options.
Illiquid securities generally cannot be sold or disposed of in the ordinary
course of business (within seven calendar days) at approximately the value at
which each Fund has valued the investments. This may have an adverse effect on
each Fund's ability to dispose of particular illiquid securities at fair market
value and may limit the Fund's ability to obtain accurate market quotations for
purposes of valuing the securities and calculating the net asset value per share
of the Fund. The Funds may also purchase securities that are not registered
under the Securities Act of 1933, as amended (the "Act"), but that can be sold
to qualified institutional buyers in accordance with Rule 144A under the Act
("Rule 144 A Securities"). Rule 144 A Securities generally must be sold only to
other qualified institutional buyers. If a particular investment in Rule
144 A Securities is not determined to be liquid under the guidelines established
by the Board of Trustees, the investment will be subject to a Fund's limitation
on investment in illiquid securities as indicated above.
110
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
SECURITIES TRANSACTIONS AND INVESTMENT INCOME:
Securities transactions are recorded on a trade date basis. Realized gains and
losses from securities sold are recorded on the identified cost basis.
Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after the trade date; interest income is not accrued
until settlement date. Each Fund instructs the custodian to segregate assets of
the Fund with a current value at least equal to the amount of its when-issued
purchase commitments.
Interest income on debt securities is accrued daily. Premiums and discounts are
amortized using the interest method. Paydown gains and losses on mortgage-backed
and asset-backed securities are presented as an adjustment to interest income.
Dividend income is recorded on the ex-dividend date, except certain dividends
from foreign securities are recorded as soon as the information is available to
the Funds if informed after the ex-dividend date. The Funds estimate components
of distributions from real estate investment trusts ("REITs"). Distributions
received in excess of income are recorded as a reduction of the cost of the
related investments. Each Fund's investment income and realized and unrealized
gains and losses are allocated among the classes of that Fund based upon the
relative average net assets of each class.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
Dividends from net investment income of the Fixed-Income Funds and the Municipal
Funds will normally be declared daily and paid monthly. Dividends from net
investment income of the REIT and Equity Income Funds are declared and paid
quarterly. Dividends from any net investment income of Growth & Income, West
Coast Equity, Mid Cap Stock, Growth, Small Cap Value, Small Cap Growth, and
International Growth Funds are declared and paid annually. Distributions of any
net capital gains earned by a Fund are distributed no less frequently than
annually at the discretion of the Board of Trustees. Additional distributions of
net investment income and capital gains for each Fund may be made at the
discretion of the Board of Trustees of the Trusts in accordance with federal
income tax regulations.
Distributions from income and capital gains are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences are primarily due to differing treatments of
income and gains on various investment securities held by the Funds, dividends
payable, redesignated distributions and differing characterization of
distributions made by each Fund.
FEDERAL INCOME TAXES:
It is each Fund's policy to qualify as a regulated investment company by
complying with the requirements of the Internal Revenue Code of 1986, as amended
(the "Code"), applicable to regulated investment companies and by distributing
substantially all of its earnings to its shareholders. Therefore, no federal
income or excise tax provision is required.
EXPENSES:
General expenses of the Trusts are allocated to all the Funds of the Trusts
based upon the relative average net assets of each Fund except printing and
postage expenses, which are allocated to all the Funds based upon the relative
number of shareholder accounts of each Fund. Operating expenses directly
attributable to a class of shares are charged to the operations of that class of
shares. Expenses of each Fund not directly attributable to the operations of any
class of shares are prorated among the classes to which the expenses relate
based on the relative average net assets of each class of shares.
USE OF ESTIMATES:
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
111
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
3. INVESTMENT ADVISORY AND OTHER TRANSACTIONS
The Advisor is entitled to a monthly fee at an annual rate based upon a
percentage of the average daily net assets of each Fund at the following rates:
FROM $125 FROM $200 FROM $250 FROM $1 FROM $2
FROM $0 MILLION MILLION MILLION FROM $500 BILLION BILLION
TO $125 TO $200 TO $250 TO $500 MILLION TO TO $2 TO $3 OVER
NAME OF FUND MILLION MILLION MILLION MILLION $1 BILLION BILLION BILLION $3 BILLION
- ------------ ------- --------- --------- --------- ---------- ------- ------- ----------
REIT Fund ......................... 0.800% 0.800% 0.800% 0.800% 0.750% 0.750% 0.700% 0.650%
Equity Income Fund ................ 0.625% 0.625% 0.625% 0.500% 0.500% 0.500% 0.500% 0.500%
Growth & Income Fund .............. 0.625% 0.625% 0.625% 0.500% 0.500% 0.500% 0.500% 0.500%
West Coast Equity Fund ............ 0.625% 0.625% 0.625% 0.625% 0.500% 0.375% 0.375% 0.375%
Mid Cap Stock Fund ................ 0.750% 0.750% 0.750% 0.750% 0.750% 0.700% 0.650% 0.600%
Growth Fund ....................... 0.750% 0.750% 0.750% 0.750% 0.700% 0.700% 0.650% 0.600%
Small Cap Value Fund .............. 0.850% 0.850% 0.850% 0.850% 0.750% 0.750% 0.750% 0.700%
Small Cap Growth Fund ............. 0.850% 0.850% 0.850% 0.850% 0.750% 0.750% 0.750% 0.700%
International Growth Fund ......... 1.000% 0.800% 0.800% 0.800% 0.800% 0.750% 0.750% 0.700%
Short Term Income Fund ............ 0.500% 0.500% 0.450% 0.450% 0.400% 0.400% 0.400% 0.400%
U.S. Government Securities Fund ... 0.500% 0.500% 0.500% 0.500% 0.500% 0.500% 0.450% 0.450%
Income Fund ....................... 0.500% 0.500% 0.500% 0.500% 0.500% 0.500% 0.450% 0.450%
High Yield Fund ................... 0.625% 0.625% 0.625% 0.500% 0.500% 0.500% 0.500% 0.500%
Tax-Exempt Bond Fund .............. 0.500% 0.500% 0.500% 0.400% 0.400% 0.400% 0.400% 0.400%
California Municipal Fund ......... 0.500% 0.500% 0.500% 0.500% 0.500% 0.450% 0.450% 0.450%
California Insured Intermediate
Municipal Fund ................. 0.500% 0.500% 0.500% 0.500% 0.500% 0.450% 0.450% 0.450%
WM Shareholder Services, Inc. (the "Transfer Agent"), a wholly owned subsidiary
of Washington Mutual, serves as the transfer agent of the Funds. Fees are paid
to the Transfer Agent for services related to the issuance and transfer of
shares, maintaining shareholder lists, and issuing and mailing distributions and
reports. For such services, the Transfer Agent receives a fee per open and
closed account, in addition to reimbursement for certain out-of-pocket expenses.
The Transfer Agent is entitled to a monthly fee based upon an annual rate of
$20.00 per open account for all Class A, Class B and Class C shareholder
accounts. Class I, Class R-1 and Class R-2 shares are not subject to shareholder
servicing fees.
The Transfer Agent also provides services to retirement plans investing in Class
R-1 and R-2 shares and their participants. For such services, the Transfer Agent
is entitled to a monthly fee at an annual rate of 0.25% of the average daily net
assets of each Class R-1 and Class R-2 shares.
Custodian fees for certain Funds have been reduced by credits allowed by the
Funds' custodian for uninvested cash balances. The Funds could have invested
this cash in income producing securities. Fees reduced by credits allowed by the
custodian for the six months ended April 30, 2006, are shown separately in the
"Statements of Operations".
4. TRUSTEES' FEES
No officer or employee of Washington Mutual or its subsidiaries receives any
compensation from the Trusts for serving as an officer or Trustee of the Trusts.
The Trusts, together with other mutual funds advised by the Advisor, pay each
Trustee who is not an officer or employee of Washington Mutual or its
subsidiaries a per annum retainer plus attendance fees for each meeting at which
they are present. The Chairman, Committee Chairs and Committee Members receive
additional remuneration for these services to the Trusts. Trustees are also
reimbursed for travel and out-of-pocket expenses. Each Trustee serves in the
same capacity for all 40 funds within the WM Group of Funds.
112
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
5. DISTRIBUTION PLANS
WM Funds Distributor, Inc. (the "Distributor"), a registered broker/dealer and a
wholly owned subsidiary of Washington Mutual, serves as distributor for the
Funds. For the six months ended April 30, 2006, the Distributor received
$9,309,605 representing commissions (front-end sales charges) on Class A shares
and $1,269,043 representing CDSCs from Class A, Class B, and Class C shares.
Each of the Funds has adopted distribution plans, pursuant to Rule 12b-1 under
the 1940 Act, applicable to Class A, Class B, Class C, Class R-1, and Class R-2
shares of each Fund (each, a "Rule 12b-1 Plan"), respectively. There are no
12b-1 Plans applicable to Class I shares of the Funds. Under the applicable Rule
12b-1 Plans, the Distributor may receive a service fee at an annual rate of
0.25% of the average daily net assets of each class. In addition, the
Distributor is paid a fee as compensation in connection with the offering and
sale of Class B, Class C, Class R-1, and Class R-2 shares. The distribution fees
for Class B and Class C shares are paid to the Distributor at annual rates of
0.75% of the average daily net assets of such shares. The distribution fees for
Class R-1 and Class R-2 are paid to the Distributor at annual rates of 0.55% and
0.30%, respectively, of the average daily net assets of such shares. These fees
may be used to cover the expenses of the Distributor primarily intended to
result in the sale of such shares, including payments to the Distributor's
representatives or others for selling shares. The service fee is paid by the
Fund to the Distributor, which in turn, pays service fees to broker/dealers that
provide services, such as accepting telephone inquiries, transaction requests,
processing correspondence, new account applications and subsequent purchases for
the shareholders. Under their terms, each Rule 12b-1 plan shall remain in effect
from year to year, provided such continuance is approved annually by vote of the
Board of Trustees, including a majority of those Trustees who are not
"interested persons" of the Trusts, as defined in the 1940 Act, and who have no
direct or indirect financial interest in the operation of such distribution
plans, or any agreements related to such plans, respectively.
6. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, excluding
U.S. government and short-term investments, for the six months ended April 30,
2006, are as follows:
PURCHASES SALES
NAME OF FUND (000S) (000S)
- ------------ ---------- ----------
REIT Fund ............................................ $ 69,015 $ 93,392
Equity Income Fund ................................... 1,691,485 1,032,535
Growth & Income Fund ................................. 367,717 745,496
West Coast Equity Fund ............................... 267,836 86,111
Mid Cap Stock Fund ................................... 115,689 157,025
Growth Fund .......................................... 911,224 381,803
Small Cap Value Fund ................................. 46,297 107,735
Small Cap Growth Fund ................................ 161,655 137,793
International Growth Fund ............................ 352,465 174,807
Short Term Income Fund ............................... 14,222 2,088
U.S. Government Securities Fund ...................... 43,936 16,376
Income Fund .......................................... 169,366 123,290
High Yield Fund ...................................... 425,184 409,876
Tax-Exempt Bond Fund ................................. 22,339 28,969
California Municipal Fund ............................ 59,244 71,827
California Insured Intermediate Municipal Fund ....... 19,342 21,531
The aggregate cost of purchases and proceeds from sales of U.S. government
securities, excluding short-term investments, for the six months ended April 30,
2006, are as follows:
PURCHASES SALES
NAME OF FUND (000S) (000S)
- ------------ --------- --------
Equity Income Fund ...................................... $ -- $ 41
Short Term Income Fund .................................. -- 4,279
U.S. Government Securities Fund ......................... 61,396 147,631
Income Fund ............................................. 53,212 17,415
High Yield Fund ......................................... 38,848 24,140
113
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
7. LENDING OF SECURITIES
Certain Funds may lend securities to brokers, dealers and other financial
organizations to earn additional income. The Funds also continue to receive
interest or dividends on the securities loaned. Each security loan is
collateralized with collateral assets in an amount equal to or greater than the
current market value of the loaned securities. There is a risk of delay in
receiving collateral, that the collateral could lose value or become valueless,
or in recovering the securities loaned or even a loss of rights in collateral
should the borrower fail financially.
At April 30, 2006, each of the Funds with outstanding loans of securities to
certain brokers, dealers or other financial institutions has segregated cash
and/or securities at least equal to the market value of securities loaned with
the Funds' custodian. The Funds currently invest the segregated cash in Mellon
GSL DBT II, which is a common collective trust that invests in high-grade
short-term investments.
8. PORTFOLIO OWNERSHIP AND OTHER FACTORS
At April 30, 2006, the WM Strategic Asset Management Portfolios hold investments
in a number of the Funds. The figures presented below represent the percentage
of shares outstanding of each Fund owned by the Portfolios:
PORTFOLIOS
-----------------------------------------------------------------------
FLEXIBLE CONSERVATIVE CONSERVATIVE STRATEGIC
INCOME BALANCED BALANCED GROWTH GROWTH
NAME OF FUND PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO TOTAL
- ------------ --------- ------------ --------- ------------ --------- -----
REIT Fund ......................... 2.1% 2.9% 31.5% 34.1% 20.4% 91.0%
Equity Income Fund ................ 1.2% 1.7% 16.7% 17.9% 11.4% 48.9%
Growth & Income Fund .............. 2.4% 2.3% 24.1% 26.0% 16.7% 71.5%
West Coast Equity Fund ............ 0.6% 1.4% 14.6% 15.5% 10.6% 42.7%
Mid Cap Stock Fund ................ 2.8% 2.3% 25.3% 26.4% 19.4% 76.2%
Growth Fund ....................... 2.8% 2.7% 30.7% 31.0% 22.1% 89.3%
Small Cap Value Fund .............. 3.3% 2.6% 30.7% 34.6% 22.3% 93.5%
Small Cap Growth Fund ............. 2.4% 1.8% 22.1% 25.1% 16.5% 67.9%
International Growth Fund ......... -- 3.0% 32.3% 32.5% 22.3% 90.1%
Short Term Income Fund ............ 44.3% 14.6% 17.5% -- -- 76.4%
U.S. Government Securities Fund ... 16.7% 9.7% 45.6% 15.8% -- 87.8%
Income Fund ....................... 18.7% 9.3% 38.6% 11.9% -- 78.5%
High Yield Fund ................... 7.0% 4.3% 24.7% 11.1% 10.6% 57.7%
From time to time, one or more of the Funds used for investment by a Portfolio
may experience relatively large investments or redemptions due to reallocations
or rebalancings of the Portfolios by the Advisor. These transactions will affect
the Funds, since the Funds that experience redemptions as a result of the
reallocations or rebalancings may have to sell portfolio securities and since
the Funds that receive additional cash will have to invest such cash. While it
is impossible to predict the overall impact of these transactions over time,
there could be adverse effects on portfolio management to the extent that the
Funds may be required to sell securities or invest cash at times when they would
not otherwise do so. These transactions could also have tax consequences if
sales of securities resulted in gains and could also increase transaction costs.
The Advisor is committed to minimizing such impact on the Funds to the extent it
is consistent with pursuing the investment objectives of the Portfolios. The
Advisor may nevertheless face conflicts in fulfilling its dual responsibilities
of the Portfolios and the Funds. The Advisor will, at all times, monitor the
impact on the Funds of transactions by the Portfolios.
114
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
9. UNREALIZED APPRECIATION/(DEPRECIATION)
At April 30, 2006, the aggregate gross unrealized appreciation and depreciation
on a tax basis are as follows:
(IN THOUSANDS)
------------------------------------------------------------------------------------
WEST SMALL SMALL
EQUITY GROWTH & COAST MID CAP CAP CAP
REIT INCOME INCOME EQUITY STOCK GROWTH VALUE GROWTH
FUND FUND FUND FUND FUND FUND FUND FUND
-------- -------- -------- -------- -------- -------- -------- ------
Gross tax unrealized appreciation ... $151,964 $592,119 $621,267 $648,272 $265,092 $303,390 $ 62,318 $92,828
Gross tax unrealized depreciation ... (3,706) (17,229) (33,301) (48,674) (967) (43,932) (36,993) (8,321)
-------- -------- -------- -------- -------- -------- -------- -------
Net tax unrealized appreciation ..... $148,258 $574,890 $587,966 $599,598 $264,125 $259,458 $ 25,325 $84,507
======== ======== ======== ======== ======== ======== ======== =======
CALIFORNIA
U.S. TAX- INSURED
INTERNATIONAL SHORT TERM GOVERNMENT HIGH EXEMPT CALIFORNIA INTERMEDIATE
GROWTH INCOME SECURITIES INCOME YIELD BOND MUNICIPAL MUNICIPAL
FUND FUND FUND FUND FUND FUND FUND FUND
------------- ---------- ---------- -------- -------- ------- ---------- --------------
Gross tax unrealized appreciation .. $328,253 $ 372 $ 2,844 $ 25,665 $ 52,050 $11,105 $14,413 $1,408
Gross tax unrealized depreciation .. (5,311) (5,028) (62,019) (43,804) (18,866) (289) (553) (595)
-------- ------- -------- -------- -------- ------- ------- ------
Net tax unrealized appreciation/
(depreciation) .................. $322,942 $(4,656) $(59,175) $(18,139) $ 33,184 $10,816 $13,860 $ 813
======== ======= ======== ======== ======== ======= ======= ======
10. INDUSTRY AND GEOGRAPHIC CONCENTRATION AND OTHER RISK FACTORS
While no individual fund is intended as a complete investment program, this is
especially true for funds that concentrate their investments such as those
investing in particular industries or regions.
The REIT Fund concentrates its investments in real estate investment trust
("REIT") securities or debt securities of issuers that are principally engaged
in the U.S. real estate or related industries. The REIT Fund could be adversely
impacted by economic trends within this industry.
The West Coast Equity Fund, which invests the majority of its assets in Alaska,
California, Oregon, and Washington, generally has more exposure to regional
economic risks than a fund making investments more broadly. The West Coast
Equity Fund could be adversely impacted by economic trends within this region.
The International Growth Fund concentrates its investments in foreign securities
in both developed and emerging market countries. Additional risks may involve
foreign currency exchange rate fluctuations, adverse political and economic
developments, and the possible prevention of currency exchange or other foreign
governmental laws or restrictions. Investments in emerging markets are subject
to additional risk as less developed countries are more likely to experience
high levels of inflation, deflation, or currency devaluation, which could harm
their economies and securities markets.
The High Yield Fund concentrates its investments in lower rated debt securities,
which may be more susceptible to adverse economic conditions than investment
grade holdings. These securities are often subordinated to the prior claims of
other senior lenders, and uncertainties may exist as to an issuer's ability to
meet principal and interest payments.
The California Municipal and California Insured Intermediate Municipal Funds are
more susceptible to factors adversely affecting issuers of California municipal
securities than is a municipal bond fund that is not concentrated in these
issuers. Uncertain economic conditions or governmental developments may affect
the ability of California municipal securities issuers to meet their financial
obligations.
Certain Funds may invest a portion of their assets in foreign securities of
developing or emerging market countries; enter into forward foreign currency
transactions; lend their portfolio securities; enter into a stock index,
interest rate and currency futures contracts, and options on such contracts;
enter into interest rate swaps or purchase or sell interest rate caps or floors;
enter into other types of options transactions; make short sales; purchase zero
coupon and payment-in-kind bonds; enter into repurchase or reverse repurchase
agreements; purchase and sell "when-issued" securities and engage in
"delayed-delivery" transactions; and enter into various other investment
practices, each with inherent risks. The risks involved in investing in a high
concentration of a single sector include those resulting from future adverse
political and economic developments or regulatory occurrences and the potential
for adverse effects to the financial conditions of the industries within the
sector due to market fluctuations.
115
Notes to Financial Statements (unaudited) (continued)
WM GROUP OF FUNDS
11. INVESTMENTS IN AFFILIATED SECURITIES
The companies listed below are an affiliate of the Fund because the Fund owned
at least 5.0% of the company's voting securities during the six-month period
ended April 30, 2006.
MARKET VALUE
SHARES SHARES OF INVESTMENTS
AT BEGINNING AT END IN AFFILIATES AT
(IN THOUSANDS) OF PERIOD ADDITIONS REDUCTIONS OF PERIOD DIVIDENDS LOSS APRIL 30, 2006
------------ --------- ---------- --------- --------- ----- ----------------
West Coast Equity Fund
Red Lion Hotels Corporation ... 1,267 18 (31) 1,254 $ -- $(149) $15,046
High Yield Fund
Crown Castle International
Corporation ................... 150 179 -- 329 514 $ -- $18,177
---- ----- -------
$514 $(149) $33,223
==== ===== =======
116
Supplemental Information (unaudited)
WM GROUP OF FUNDS
BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENT
Each year, the Board of Trustees of the Trust (the "Board"), including a
majority of the Trustees who are not interested persons of the Trust (the
"Independent Trustees"), is required to determine whether to continue the
Trust's advisory agreement. The Investment Company Act of 1940, as amended,
requires that the Board request and evaluate, and that the investment manager
furnish, such information as may reasonably be necessary to evaluate the terms
of the Trust's advisory agreement. In May 2005, the Board and the Independent
Trustees approved a new Investment Sub-Advisory Agreement (the "Agreement") with
Capital Guardian Trust Company ("Capital Guardian"), and in November 2005, the
Board and the Independent Trustees approved an amendment of the Trust's
Investment Sub-Advisory Agreement with Capital Guardian, in each case following
the recommendation of the Investment Committee (the "Committee"), a majority of
the members of which are Independent Trustees, and the recommendations of the
Independent Trustees as a whole. The material factors and conclusions that
formed the basis for the Committee's recommendation and the subsequent approval
by the Board and the Independent Trustees are required to be in this report and
are discussed below. In connection with the November 2005 approval of the
amendment, the Board, the Independent Trustees and the Committee relied on the
information provided in connection with the May 2005 approval (as supplemented
by performance information for periods ended September 30, 2005). The material
factors and conclusions that formed the basis for the Committee's recommendation
and the subsequent approval by the Board and the Independent Trustees in
November 2005 were the same as those in May 2005, which are discussed below,
except that the Board, the Independent Trustees and the Committee also
considered the addition of emerging market securities to Capital Guardian's
mandate for the International Growth Fund, and that the effect of the amendment
was to reduce the fees payable to the Advisor in the same amount that the fees
to Capital Guardian were increased, so that the total advisory fees payable by
the International Growth Fund would not change.
REVIEW PROCESS:
The Independent Trustees received assistance and advice, including a written
memorandum, regarding the legal standards applicable to the consideration of
advisory arrangements from independent counsel to the Trusts and the Independent
Trustees. The Independent Trustees discussed the continuation of the Agreement
with representatives of the Advisor and in private session with independent
legal counsel at which no representatives of the Advisor were present. The
Committee, in deciding to recommend approval of the Agreement, and the Board and
the Independent Trustees, in approving Such agreement, did not identify any
particular information that was all-important or controlling, and each Trustee
attributed different weights to the various factors. The Trustees evaluated all
information available to them on a Fund-by-Fund basis, and their deliberations
were made separately in respect of each Fund. This summary describes the most
important, but not all, of the factors considered by the Board, the Independent
Trustees and the Committee.
MATERIALS REVIEWED:
During the course of each year, the Board receives a wide variety of materials
relating to the services provided by the Advisor and its affiliates, including
reports on: each Fund's investment results; portfolio construction; portfolio
composition; portfolio trading practices; performance attribution; shareholder
services; the Advisor's views on the economy and capital markets; and other
information relating to the nature, extent and quality of services provided by
the Advisor and its affiliates to the Funds. In addition, in connection with its
annual consideration of the Agreement, the Board requests and reviews
supplementary information regarding the terms of the Agreement, the
Funds' investment results, advisory fee and total expense comparisons, financial
and profitability information regarding the Advisor and its affiliates,
descriptions of various functions undertaken by the Advisor, such as compliance
monitoring, and information about the personnel providing investment management
and administrative services to the Funds. The Board requested and evaluated
performance and expense information for other investment companies compiled by
Lipper Inc., a third-party data provider ("Lipper"). The Board, the Independent
Trustees and the Committee also considered information regarding "revenue
sharing" arrangements that the Advisor and its affiliates have entered into with
various intermediaries that sell shares of the Funds. The Board also requested
and reviewed information relating to other services provided to the Funds by the
Advisor and its affiliates under other agreements, including information
regarding so-called "fall-out" benefits to the Advisor and its affiliates due to
their other relationships with the Funds. The Board, the Independent Trustees
and the Committee also received and reviewed comparative performance information
regarding the Funds at each of the quarterly Board and Committee meetings.
NATURE, EXTENT AND QUALITY OF SERVICES:
Nature and Extent of Services -- In considering the approval of the Agreement,
the Board, the Independent Trustees and the Committee evaluated the nature and
extent of the services provided by the Advisor, its affiliates and the
sub-advisors. For each Fund, the Advisor or the relevant sub-advisor, as
applicable, formulates the Fund's investment policies (subject to the terms of
the prospectus); analyzes economic trends and capital market developments;
evaluates the risk/return characteristics of the Fund;
117
Supplemental Information (unaudited) (continued)
WM GROUP OF FUNDS
constructs the Fund's portfolio; monitors the Fund's investment performance; and
reports to the Board, the Independent Trustees and the Committee. The Board, the
Independent Trustees and the Committee considered information concerning the
investment philosophy and investment process used by the Advisor and the
sub-advisors in managing the Funds. In this context, the Board, the Independent
Trustees and the Committee considered the in-house research capabilities of the
Advisor and the sub-advisors as well as other sources available to the Advisor
and the sub-advisors, including research services available to the Advisor and
the sub-advisors as a result of securities transactions effected for the Funds
and other investment advisory clients of the Advisor and the sub-advisors. The
Board, the Independent Trustees and the Committee considered the managerial and
financial resources available to the Advisor and the sub-advisors and concluded
that they would be sufficient to meet any reasonably foreseeable obligations
under the Agreement. The Board, the Independent Trustees and the Committee noted
that the standard of care under the Agreement was comparable to that found in
many investment advisory agreements, and considered the record of the Advisor in
resolving potential disputes arising under its investment advisory agreement
with the WM Group of Funds to be in the best interests of shareholders.
Quality of Services -- The Board, the Independent Trustees and the Committee
considered the quality of the services provided by the Advisor and the
sub-advisors and the quality of their resources that are available to the Funds.
The Board, the Independent Trustees and the Committee considered the investment
experience and professional qualifications of the personnel of the Advisor, its
affiliates and the sub-advisors, and the size and functions of their staffs as
well as the reputation of the Advisor and the sub-advisors. The Board, the
Independent Trustees and the Committee considered the complexity of managing the
Funds relative to other types of funds. The Board, the Independent Trustees and
the Committee also received and reviewed information regarding the quality of
non-investment advisory services provided to the Funds by the Advisor and its
affiliates under other agreements.
The Board, the Independent Trustees and the Committee concluded that the
services provided by the Advisor and the sub-advisors have benefited and should
continue to benefit the Funds and its shareholders. The Board, the Independent
Trustees and the Committee concluded that the investment philosophies,
processes, and research capabilities of the Advisor and the sub-advisors were
well-suited to the Funds, given their investment objectives and policies. The
Board, the Independent Trustees and the Committee concluded that the scope of
the services provided to the Funds by the Advisor, its affiliates and the
sub-advisors were consistent with the Funds' operational requirements,
including, in addition to its investment objectives, compliance with the Funds'
investment restrictions, tax and reporting requirements and related shareholder
services. The Board, the Independent Trustees and the Committee concluded that
the nature, scope and quality of the services provided by the Advisor, its
affiliates and the sub-advisors were sufficient, in light of the resources
dedicated by the Advisor and the sub-advisors and their integrity, personnel,
systems and financial resources, to merit approval of the Agreement.
PORTFOLIO MANAGEMENT SERVICES AND PERFORMANCE:
In their evaluation of the quality of the portfolio management services provided
by the Advisor and the sub-advisors, the Board, the Independent Trustees and the
Committee considered the professional credentials and investment experience of
the Funds' portfolio managers. The Board and the Independent Trustees considered
whether the Funds operated within their investment objectives and their record
of compliance with investment restrictions. The Board, the Independent Trustees
and the Committee reviewed information comparing the Funds' historical
performance to relevant market indices for the 1-, 3- and 5-year periods ended
September 30, 2005, and to performance information for other investment
companies with similar investment objectives over the 1-, 3-, 5-, 10-year and
since inception periods, derived from data compiled by Lipper. The Board, the
Independent Trustees and the Committee concluded that the Advisor's and the
sub-advisors' performance record and investment processes used in managing the
Funds were sufficient to merit approval of the Agreement.
MANAGEMENT FEES AND EXPENSES:
The Board, the Independent Trustees and the Committee reviewed information,
including comparative information provided by Lipper, regarding the advisory,
transfer agent, and service and distribution fees paid to the Advisor, its
affiliates and the sub-advisors, and the total expenses borne by the Funds. The
Board, the Independent Trustees and the Committee reviewed the transfer agency
fees paid by the Funds to WM Shareholder Services, Inc. (the "Transfer Agent"),
an affiliate of the Advisor, as well as the distribution (12b-1) fees paid to
the Distributor. They considered the Funds' management fees relative to their
respective peer group as determined by Lipper. The Board, the Independent
Trustees and the Investment Committee considered the fees paid to the Advisor by
other clients, and the services provided to such clients relative to the fees
paid by, and services provided to, the Funds. The Board, the Independent
Trustees and the Committee concluded that the fees to be charged under the
Agreement bore a reasonable relationship to the scope and quality of the
services provided.
118
Supplemental Information (unaudited) (continued)
WM GROUP OF FUNDS
PROFITABILITY AND ECONOMIES OF SCALE:
Profitability -- The Board, the Independent Trustees and the Committee reviewed
information regarding the cost of services provided by the Advisor and its
affiliates and the profitability (before and after distribution expenses and
prior to taxes) of the Advisor's relationship with the Funds. The Board, the
Independent Trustees and the Committee considered trends in the profitability of
the Advisor and its affiliates, and information provided by Lipper regarding the
pre- and post-marketing profitability of other investment advisers with
publicly-traded parent companies. The Board, the Independent Trustees and the
Committee considered that the Advisor must be able to pay and retain experienced
professional personnel at competitive rates to provide services to the Funds
(and in connection therewith reviewed and considered changes in the structure of
compensation of the investment professionals of the Advisor including a change
in the performance-based component of the compensation and the introduction of
options and restricted stock rather than vesting periods for cash bonuses) and
that maintaining the financial viability of the Advisor is important in order
for it to continue to provide significant services to the Funds and its
shareholders. The Board, the Independent Trustees and the Committee considered
the impact of previously-negotiated fee reductions on the profitability of the
Advisor and the year-to-year trends in pre-distribution margins for the Advisor
over a four-year period in which complex-wide assets more than doubled. The
Board, the Independent Trustees and the Committee considered various breakpoint
schedules and reviewed a graph showing the effective fees for the Advisor at
different asset levels. In addition, the Board, the Independent Trustees and the
Committee considered information regarding the direct and indirect benefits the
Advisor receives as a result of its relationships with the Funds, including
compensation paid to the Advisor and their affiliates, including transfer agency
fees to the Transfer Agent and 12b-1 fees to the Distributor as well as research
provided to the Advisor in connection with portfolio transactions effected on
behalf of the Funds (soft dollar arrangements), and reputational benefits. The
Trustees considered the fact that the structure of breakpoints for the Advisor's
fees and the fees of the sub-advisors for Funds with multiple sub-advisors was
such that, assuming relatively equal allocation of Fund assets among all
sub-advisors, the Advisor's fee would be reduced by breakpoints at lower asset
levels than those at which the Advisor might benefit from breakpoints in the
fees of the sub-advisors. The Trustees did not evaluate the profitability to the
sub-advisors of their relationships with the Funds because they concluded that
negotiations between the Advisor and the sub-advisors had been entirely at
arm's-length.
Economies of Scale -- The Board, the Independent Trustees and the Committee
reviewed the extent to which the Advisor may realize economies of scale in
managing and supporting the Funds and the current level of Fund assets in
relation to the breakpoints in the Funds' advisory fees. The Board, the
Independent Trustees and the Committee considered the extent to which any
economies of scale might be realized (if at all) by the Advisor across a variety
of products and services, and not only in respect of a single Fund. The Board,
the Independent Trustees and the Committee considered the savings for the Funds
that had been achieved due to breakpoints previously implemented as a result of
negotiations between the Advisor and the Board.
The Board, the Independent Trustees and the Committee concluded that the
Funds' cost structure was reasonable given the scope and quality of the services
provided to the Funds and that the Advisor was sharing any economies of scale
with the Funds and its shareholders.
ADDITIONAL CONSIDERATIONS:
The Board, the Independent Trustees and the Committee considered the procedures
of the Advisor designed to fulfill its fiduciary duties to advisory clients with
respect to possible conflicts of interest, including the codes of ethics, the
integrity of the systems in place to ensure compliance with the foregoing, and
the record of the Advisor in these matters. The Board, the Independent Trustees
and the Committee also received and considered information concerning procedures
of the Advisor with respect to the execution of portfolio transactions.
CONCLUSIONS:
Based on their review, including their consideration of each of the factors
referred to above, the Board, the Independent Trustees and the Committee
concluded that the Agreement, including the fees payable to the Advisor and the
sub-advisors, are fair and reasonable to the Funds and their shareholders given
the scope and quality of the services provided to the Funds and such other
considerations as the Trustees considered relevant in the exercise of their
reasonable business judgment and that approval of the Agreement was in the best
interests of the Funds and their shareholders. The Board and Independent
Trustees unanimously approved the Agreement.
119
Supplemental Information (unaudited) (continued)
WM GROUP OF FUNDS
OTHER FUND INFORMATION
SCHEDULES OF INVESTMENTS:
The Trusts file their complete schedules of portfolio holdings with the
Securities and Exchange Commission ("SEC") for the first and third quarters of
each fiscal year on Form N-Q. The Trusts' Forms N-Q are available at
http://www.sec.gov and also may be reviewed and copied at the SEC's Public
Reference Room ("PRR") in Washington, DC. Information regarding the operation of
the PRR may be obtained by calling 800-SEC-0330.
PROXY VOTING INFORMATION:
The policies and procedures that the Trusts use to determine how to vote proxies
relating to portfolio securities held by the Funds are included in the
Trusts' Statement of Additional Information which is available, without charge
and upon request, by calling 800-222-5852. Information regarding how the Funds
voted proxies relating to portfolio securities during the most recent
twelve-month period ended June 30 is available at http://www.wmgroupoffunds.com.
This information is also available at http://www.sec.gov.
120
(GRAPHIC)
(WM GROUP OF FUNDS LOGO)
A mutual fund's share price and investment return will vary with market
conditions, and the principal value of an investment when you sell your shares
may be more or less than the original cost.
This semiannual report is published as general information for the shareholders
of the WM Group of Funds. This material is not authorized for distribution
unless preceded or accompanied by a current prospectus that includes more
information regarding the risk factors, expenses, policies, and objectives of
the funds. Investors should read the prospectus carefully before investing. To
obtain an additional prospectus, please contact your Investment Representative
or call 800-222-5852.
The WM Group of mutual funds is advised by WM Advisors, Inc., distributed by WM
Funds Distributor, Inc., and sold through WM Financial Services, Inc. (all
affiliates of Washington Mutual, Inc.) and independent broker/dealers.
Distributed by:
WM Funds Distributor, Inc.
Member NASD
(E-DELIVERY LOGO)
SAVE TIME AND PAPER. ENROLL TODAY.
Choose e-delivery and we'll e-mail you when statements, prospectuses, and
shareholder reports are updated. You can select which items to receive
electronically when you sign up at wmgroupoffunds.com.
(WM GROUPOFFUNDS LOGO)
P.O.Box 8024
Boston, MA 02266-8024
WMGSAR (6/29/06)
ITEM 2. CODE OF ETHICS
Not applicable for this filing.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
Not applicable for this filing.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not applicable for this filing.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable for this filing.
ITEM 6. SCHEDULE OF INVESTMENTS
Not Applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES
Not Applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES
Not Applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANIES AND AFFILIATED PURCHASERS
Not Applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 11. CONTROLS AND PROCEDURES:
(a) The registrant's principal executive officer and principal financial officer
have concluded, based on their evaluation of the effectiveness of the design and
operation of the registrant's disclosure controls and procedures as of a date
within 90 days of the filing date of this report on Form N-CSR, that the design
and operation of such procedures are effective to provide reasonable assurance
that information required to be disclosed by the registrant in the reports that
it files or submits on Form N-CSR is recorded, processed, summarized, and
reported within the time periods specified in the SEC's rules and forms.
(b) There have been no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Investment Company
Act of 1940, as amended) that occurred during the second fiscal quarter of the
period covered by this report that have materially affected, or are reasonably
likely to materially affect, the registrant's internal control over financial
reporting.
ITEM 12. EXHIBITS
(a) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 of the Investment
Company Act of 1940 attached hereto as Exhibit 99.CERT.
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
attached hereto as Exhibit 99.906 CERT.
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.
WM Trust II
By: /s/ William G. Papesh
William G. Papesh
President and Chief Executive Officer
Date: June 29, 2006
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Jeffrey L. Lunzer
Jeffrey L. Lunzer
Treasurer and Chief Financial Officer
Date: June 29, 2006
By: /s/ William G. Papesh
William G. Papesh
President and Chief Executive Officer
Date: June 29, 2006