1
The One
Investor
Program
Annual Report
For the year ended June 30, 1998
The One Group Investor Growth Fund
The One Group Investor Growth & Income Fund
The One Group Investor Balanced Fund
The One Group Investor Conservative Growth Fund
THE ONE GROUP
----------------------
FAMILY OF MUTUAL FUNDS
2
IMPORTANT CUSTOMER INFORMATION. INVESTMENT PRODUCTS:
- are not deposits or obligations of, or guaranteed by,
BANC ONE CORPORATION or any of its affiliates, [FDIC LOGO
WITH SLASH
- are not insured by the FDIC, and THOUGH IT]
- are subject to investment risks, including possible
loss of the principal amount invested.
3
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Table of Contents
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Portfolio Performance Review............................................... 2
Schedules of Portfolio Investments......................................... 8
Statements of Assets and Liabilities....................................... 12
Statements of Operations................................................... 13
Statements of Changes in Net Assets........................................ 14
Notes to Financial Statements.............................................. 16
Financial Highlights....................................................... 22
Report of Independent Accountants.......................................... 38
1
4
The One Group Investor Funds
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUNDS PERFORM?
For the year ended June 30, 1998, The One Group Investor Funds posted the
following total returns for their respective Fiduciary share class:
- - The One Group Investor Growth Fund, 23.81%
- - The One Group Investor Growth and Income Fund, 20.34%
- - The One Group Investor Balanced Fund, 17.02%
- - The One Group Investor Conservative Growth Fund, 12.73%
For information on other share classes and performance comparisons to indexes,
please see pages 4-7.
HOW DID THE BOND AND STOCK MARKETS PERFORM?
The bond market continued to benefit from low inflation, which helped push
interest rates down and bond prices up. Furthermore, events in Asia contributed
to a weakening global economy, which in turn helped support favorable bond
market conditions in the United States.
The stock market continued to provide better-than-average investment returns,
thanks to low inflation, moderate economic growth and strong corporate earnings
growth. In addition, a favorable bond market contributed to the stock market's
strength by allowing price/earnings (P/E) multiple expansion. That is, the
declining interest rate environment allowed companies to realize greater
profits, and stock prices increased on these favorable earnings results.
For more than four years, large-capitalization growth stocks have led the
domestic market surge, outperforming smaller-company stocks and value-oriented
stocks. Investors continued to favor larger companies due to their earnings
reliability and stock liquidity.
DID THE SITUATION IN ASIA INFLUENCE STOCK RETURNS?
Beginning in late 1997, many larger, multinational companies, particularly in
the semiconductor, energy and commodities sectors, felt the effects of the Asian
markets' meltdown. With too much capital and investment generating excess
capacity, lower prices led to insufficient profits. As a result, currencies
declined and market returns plummeted for most Asian markets.
WERE THERE ANY OTHER NOTABLE PERFORMANCES OVERSEAS?
Many European markets experienced a comeback, with strong one-year performance
from Italy, up 63%; Spain up 50%; Germany, up 46%; and France, up 43%.
WHAT WAS YOUR OVERALL ASSET ALLOCATION STRATEGY?
Each of the Investor Funds maintained relatively strong exposure to equity funds
(depending, of course, on each fund's overall investment objective and asset
allocation parameters), which enabled the funds to participate in the ongoing
stock market rally and post attractive overall returns. In addition, each Fund's
allocation toward the bond market was slightly greater than what we consider to
be average exposure.
WHY WAS THAT?
We implemented this strategy based on our ongoing research efforts, which showed
that stocks, on a valuation basis, continued to be more expensive than bonds. We
felt that this presented some additional risks for stocks. At the same time,
earnings momentum remained strong. We therefore made only a slight shift toward
fixed income funds in order to gain some downside protection from the stock
market's high valuations. The average fund allocations during the period were as
follows:
- - The One Group Investor Growth Fund: 86% equity funds; 13% fixed income funds;
1% money market funds
- - The One Group Investor Growth and Income Fund: 66% equity funds; 33% fixed
income funds; 1% money market funds
- - The One Group Investor Balanced Fund: 46% equity funds; 53% fixed income
funds; 1% money market funds
- - The One Group Conservative Growth Fund: 26% equity funds; 72% fixed income
funds; 2% money market funds
WHAT WERE YOUR KEY STRATEGIES IN THE EQUITY ARENA?
The Investor Funds enjoyed varying exposure, depending on the overall investment
objective, to the following equity styles: large capitalization,
mid-capitalization, small capitalization and international. Within each style,
individual stock selection remains the core of our management process. We
modestly adjusted our asset allocations to include in-
2
5
The One Group Investor Funds
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
ternational stocks, giving the funds an opportunity to take advantage of lower
valuations in Asia and continued economic recovery in Europe. Our international
exposure is now between 5% and 11%, with the greatest exposure in The One Group
Investor Growth Fund. This ongoing approach toward diversification helped limit
risk while offering return opportunities from different market segments.
WHAT WERE YOUR KEY STRATEGIES WITHIN THE FIXED INCOME MARKET?
Within the fixed income funds, our efforts centered on maintaining a low-risk
profile by keeping durations at or near their average levels. (Duration is a
measure of a fund's price sensitivity to interest rate changes. A longer
duration indicates greater sensitivity; a shorter duration indicates less.)
Instead of making "bets" on interest rate movements by significantly altering
duration, we prefer to concentrate on the yield component of total return.
Over the past year, our fund managers focused on select investments in the
corporate, asset-backed and mortgage-backed sectors. This allowed the funds to
capture the yield advantages that these securities generally offered compared to
Treasury securities. At the same time, they focused on maintaining portfolios
with good average credit quality.
WHAT IS YOUR OUTLOOK FOR THE FUNDS?
Economic activity is critical to the funds' performance because the economy
drives earnings. The current economic expansion, now in its eighth year, is one
of the longest in history. Looking ahead to fiscal 1999, we expect U.S. economic
growth to remain positive, but to slow down from recent levels. Corporate
earnings should continue to grow, but perhaps not at the pace we've seen
recently.
We also believe that inflation will remain low, leading to a stable or lower
interest rate environment. As such, we believe there will be little opportunity
for price volatility to significantly influence bond market returns.
Asia remains the one wild card. An unforeseen depression in any of these
countries could spill over and put a squeeze on U.S. growth. We believe that a
depression is unlikely, however, because Japan's economic package should provide
guidance for the country and establish an outline for deregulation. These moves
should bring Japan closer to financial reform and improve the banking system.
Given the extraordinary equity gains of the last several years, it is not
realistic to expect this pace to continue. Going forward, we think the equity
market will be a bit more selective, which would make individual security
selection even more important.
We currently don't anticipate making any significant changes to our asset
allocation strategies. But we will continue to monitor the economic climate for
inflationary pressures and valuation levels in the financial markets. We also
will keep close tabs on the situation in Asia and how events there may affect
the funds' investments.
/s/ Richard R. Jandrain III
Richard R. Jandrain III
Senior Managing Director of Equity Securities
Director, Asset Allocation Committee
Please refer to the prospectus and the accompanying financial statements for
more information about your Fund.
3
6
The One Group Investor Growth Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Fiduciary 23.81% 24.49%
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Fiduciary
12/96 10000 10000 10000
6/97 11945 10680 11350
6/98 15462 12724 14053
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class A 23.44% 23.78%
Class A* 17.87% 20.17%
* Reflects 4.50% Sales Charge.
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Class A* Class A
6/98 15462 12724 13303 13929
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class B 22.52% 23.91%
Class B** 18.52% 21.61%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Class B** Class B
6/98 15462 12724 13552 13952
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (7/1/97)
Class C 22.42% 22.42%
Class C** 21.42% 21.42%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Class C** Class C
6/98 12944 11914 12141 12241
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Investor Growth Fund is measured against the S&P 1500
Index, an unmanaged index generally representative of the performance of large
and small companies in the US stock market. Investors are unable to purchase the
index directly, although they can invest in the underlying securities. The
performance of the index does not reflect the deduction of expenses associated
with a mutual fund, such as investment management. By contrast, the performance
of the fund reflects the deduction of these value-added services as well as the
deduction of sales charges on Class A Shares and applicable contingent deferred
sales charges on Class B and Class C Shares.
The Lipper Mix for all the classes consists of the average monthly returns of
the Lipper General Equity Funds Universe (75%), the Lipper International Funds
Universe (10%), and the Lipper Intermediate US Government Bond Funds Universe
(15%). The Lipper Universes consist of the equally weighted average monthly
return of all the funds within the category.
6/97 11945 10680 10776 11284
12/96 10000 10000 9550 10000
6/97 11945 10680 11388 11388
12/96 10000 10000 10000 10000
7/97 10000 10000 10000 10000
4
7
The One Group Investor Growth & Income Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Fiduciary 20.34% 20.40%
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Fiduciary
12/96 10000 10000 10000
6/97 11945 10535 11087
6/98 15462 12342 13342
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class A 20.18% 20.73%
Class A* 14.76% 17.21%
* Reflects 4.50% Sales Charge.
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Class A* Class A
6/98 15462 12342 12797 13399
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class B 19.13% 19.72%
Class B** 15.13% 17.38%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Class B** Class B
6/98 15462 12342 12825 13225
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (7/1/97)
Class C 19.08% 19.08%
Class C** 18.08% 18.08%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period
(Fiscal Year Covered) S&P 1500 Lipper Mix Class C** Class C
6/98 12944 11715 11808 11908
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Investor Growth & Income Fund is measured against the S&P
1500 Index, an unmanaged index generally representative of the performance of
large and small companies in the US stock market. Investors are unable to
purchase the index directly, although they can invest in the underlying
securities. The performance of the index does not reflect the deduction of
expenses associated with a mutual fund, such as investment management. By
contrast, the performance of the fund reflects the deduction of these
value-added services as well as the deduction of sales charges on Class A Shares
and applicable contingent deferred sales charges on Class B and Class C Shares.
The Lipper Mix for all the classes consists of the average monthly returns of
the Lipper General Equity Funds Universe (60%), the Lipper International Funds
Universe (5%), and the Lipper Intermediate US Government Bond Funds Universe
(35%). The Lipper Universes consist of the equally weighted average monthly
return of all the funds within the category.
6/97 11945 10535 10648 11150
12/96 10000 10000 9550 10000
6/97 11945 10535 11102 11102
12/96 10000 10000 10000 10000
7/97 10000 10000 10000 10000
5
8
The One Group Investor Balanced Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Fiduciary 17.02% 16.60%
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Aggregate Bond Lipper Mix Fiduciary
6/98 11219 11890 12694
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class A 16.62% 16.29%
Class A* 11.39% 12.90%
* Reflects 4.50% Sales Charge.
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Bond Lipper Mix Class A* Class A
6/98 11219 11890 12074 12641
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class B 15.85% 15.67%
Class B** 11.85% 13.28%
** Reflects Applicable Contingent Deferred Sales Charge.
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Bond Lipper Mix Class B** Class B
6/98 11219 11890 12136 12536
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (7/1/97)
Class C 15.66% 15.66%
Class C** 14.66% 14.66%
** Reflects Applicable Contingent Deferred Sales Charge.
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Bond Lipper Mix Class C** Class C
6/98 10868 11444 11466 11566
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Investor Balanced Fund is measured against the Lehman
Brothers Intermediate Aggregate Bond Index, an unmanaged index comprised of US
Government, mortgage, corporate and asset-backed securities with maturities of
one to ten years. Investors are unable to purchase the index directly, although
they can invest in the underlying securities. The performance of the index does
not reflect the deduction of expenses associated with a mutual fund, such as
investment management. By contrast, the performance of the fund reflects the
deduction of these value-added services as well as the deduction of sales
charges on Class A Shares and applicable contingent deferred sales charges on
Class B and Class C Shares.
The Lipper Mix for all the classes consists of the average monthly returns of
the Lipper General Equity Funds Universe (40%), the Lipper International Funds
Universe (5%), and the Lipper Intermediate US Government Bond Funds Universe
(55%). The Lipper Universes consist of the equally weighted average monthly
return of all the funds within the category.
6/97 10323 10390 10848
12/96 10000 10000 10000
6/97 10323 10390 10353 10841
12/96 10000 10000 9550 10000
6/97 10323 10390 10822 10822
12/96 10000 10000 10000 10000
7/97 10000 10000 10000 10000
6
9
The One Group Investor Conservative Growth Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Fiduciary 12.73% 12.15%
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Aggregate Bond Lipper Mix Fiduciary
6/98 11219 11444 11949
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class A 12.38% 11.56%
Class A* 7.29% 8.31%
* Reflects 4.50% Sales Charge.
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Bond Lipper Mix Class A* Class A
6/98 11219 11444 11320 11852
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (12/10/96)
Class B 11.53% 10.90%
Class B** 7.53% 8.46%
** Reflects Applicable Contingent Deferred Sales Charge.
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Bond Lipper Mix Class B** Class B
6/98 11219 11444 11344 11744
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (7/1/97)
Class C 11.48% 11.48%
Class C** 10.48% 10.48%
** Reflects Applicable Contingent Deferred Sales Charge.
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Bond Lipper Mix Class C** Class C
6/98 10868 11172 11048 11148
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Investor Conservative Growth Fund is measured against the
Lehman Brothers Intermediate Aggregate Bond Index, an unmanaged index comprised
of US Government, mortgage, corporate and asset-backed securities with
maturities of one to ten years. Investors are unable to purchase the index
directly, although they can invest in the underlying securities. The performance
of the index does not reflect the deduction of expenses associated with a mutual
fund, such as investment management. By contrast, the performance of the fund
reflects the deduction of these value-added services as well as the deduction of
sales charges on Class A Shares and applicable contingent deferred sales charges
on Class B and Class C Shares.
The Lipper Mix for all the classes consists of the average monthly returns of
the Lipper General Equity Funds Universe (20%), the Lipper International Funds
Universe (5%), and the Lipper Intermediate US Government Bond Funds Universe
(75%). The Lipper Universes consist of the equally weighted average monthly
return of all the funds within the category.
6/97 10323 10243 10600
12/96 10000 10000 10000
6/97 10323 10243 10072 10546
12/96 10000 10000 9550 10000
6/97 10323 10243 10530 10530
12/96 10000 10000 10000 10000
7/97 10000 10000 10000 10000
7
10
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The One Group Family of Mutual Funds
Investor Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- --------------------------------------- --------
INVESTMENT COMPANIES (98.4%):
1,853 The One Group Disciplined Value Fund
Fiduciary Class...................... $ 31,315
840 The One Group Government Bond Fund
Fiduciary Class...................... 8,489
1,473 The One Group Growth Opportunities Fund
Fiduciary Class...................... 33,163
890 The One Group Income Bond Fund
Fiduciary Class...................... 8,464
417 The One Group Intermediate Bond Fund
Fiduciary Class...................... 4,219
1,352 The One Group International Equity
Index Fund Fiduciary Class........... 24,301
1,437 The One Group Large Company Growth Fund
Fiduciary Class...................... 32,631
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- --------------------------------------- --------
INVESTMENT COMPANIES, CONTINUED:
1,812 The One Group Large Company Value Fund
Fiduciary Class...................... $ 30,264
402 The One Group Limited Volatility Fund
Fiduciary Class...................... 4,223
614 The One Group Prime Money Market Fund
Fiduciary Class...................... 614
688 The One Group Small Capitalization Fund
Fiduciary Class...................... 8,296
2,315 The One Group Value Growth Fund
Fiduciary Class...................... 31,278
--------
Total Investment Companies 217,257
--------
Total (Cost $199,115) (a) $217,257
========
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Percentages indicated are based on net assets of $220,699.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $103. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation...................... $18,727
Unrealized depreciation...................... (688)
-------
Net unrealized appreciation.................. $18,039
=======
See notes to financial statements.
8
11
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Investor Growth & Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- --------------------------------------- --------
INVESTMENT COMPANIES (98.6%):
1,426 The One Group Disciplined Value Fund
Fiduciary Class...................... $ 24,091
2,202 The One Group Government Bond Fund
Fiduciary Class...................... 22,263
1,133 The One Group Growth Opportunities Fund
Fiduciary Class...................... 25,514
2,334 The One Group Income Bond Fund
Fiduciary Class...................... 22,199
1,311 The One Group Intermediate Bond Fund
Fiduciary Class...................... 13,269
1,161 The One Group International Equity
Index Fund Fiduciary Class........... 20,855
1,184 The One Group Large Company Growth Fund
Fiduciary Class...................... 26,899
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- --------------------------------------- --------
INVESTMENT COMPANIES, CONTINUED:
1,494 The One Group Large Company Value Fund
Fiduciary Class...................... $ 24,945
843 The One Group Limited Volatility Fund
Fiduciary Class...................... 8,861
718 The One Group Prime Money Market Fund
Fiduciary Class...................... 718
361 The One Group Small Capitalization Fund
Fiduciary Class...................... 4,351
449 The One Group Ultra Short-Term Income
Fund Fiduciary Class................. 4,430
2,082 The One Group Value Growth Fund
Fiduciary Class...................... 28,127
--------
Total Investment Companies 226,522
--------
Total (Cost $208,652) (a) $226,522
========
- ------------
Percentages indicated are based on net assets of $229,831.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $380. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation...................... $17,785
Unrealized depreciation...................... (295)
-------
Net unrealized appreciation.................. $17,490
=======
See notes to financial statements.
9
12
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Investor Balanced Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- --------------------------------------- --------
INVESTMENT COMPANIES (97.8%):
800 The One Group Disciplined Value Fund
Fiduciary Class...................... $ 13,523
3,302 The One Group Government Bond Fund
Fiduciary Class...................... 33,384
636 The One Group Growth Opportunities Fund
Fiduciary Class...................... 14,321
3,294 The One Group Income Bond Fund
Fiduciary Class...................... 31,328
1,734 The One Group Intermediate Bond Fund
Fiduciary Class...................... 17,544
796 The One Group International Equity
Index Fund Fiduciary Class........... 14,306
760 The One Group Large Company Growth Fund
Fiduciary Class...................... 17,256
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- --------------------------------------- --------
INVESTMENT COMPANIES, CONTINUED:
958 The One Group Large Company Value Fund
Fiduciary Class...................... $ 16,002
1,116 The One Group Limited Volatility Fund
Fiduciary Class...................... 11,724
956 The One Group Prime Money Market Fund
Fiduciary Class...................... 956
792 The One Group Ultra Short-Term Income
Fund Fiduciary Class................. 7,816
1,530 The One Group Value Growth Fund
Fiduciary Class...................... 20,675
--------
Total Investment Companies 198,835
--------
Total (Cost $184,322) (a) $198,835
========
- ------------
Percentages indicated are based on net assets of $203,278.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $175. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation...................... $14,522
Unrealized depreciation...................... (184)
-------
Net unrealized appreciation.................. $14,338
=======
See notes to financial statements.
10
13
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Investor Conservative Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- ---------------------------------------- -------
INVESTMENT COMPANIES (99.2%):
99 The One Group Disciplined Value Fund
Fiduciary Class....................... $ 1,666
2,093 The One Group Government Bond Fund
Fiduciary Class....................... 21,164
78 The One Group Growth Opportunities Fund
Fiduciary Class....................... 1,764
1,864 The One Group Income Bond Fund Fiduciary
Class................................. 17,726
146 The One Group Income Equity Fund
Fiduciary Class....................... 3,516
1,080 The One Group Intermediate Bond Fund
Fiduciary Class....................... 10,934
245 The One Group International Equity Index
Fund Fiduciary Class.................. 4,405
MARKET
SHARES SECURITY DESCRIPTION VALUE
- ------- ---------------------------------------- -------
INVESTMENT COMPANIES, CONTINUED:
205 The One Group Large Company Growth Fund
Fiduciary Class....................... $ 4,649
258 The One Group Large Company Value Fund
Fiduciary Class....................... 4,311
641 The One Group Limited Volatility Fund
Fiduciary Class....................... 6,739
1,686 The One Group Prime Money Market Fund
Fiduciary Class....................... 1,686
341 The One Group Ultra Short-Term Income
Fund Fiduciary Class.................. 3,369
264 The One Group Value Growth Fund
Fiduciary Class....................... 3,565
-------
Total Investment Companies 85,494
-------
Total (Cost $82,599) (a) $85,494
=======
- ------------
Percentages indicated are based on net assets of $86,167.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $74. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation...................... $2,906
Unrealized depreciation...................... (85)
------
Net unrealized appreciation.................. $2,821
======
See notes to financial statements.
11
14
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
INVESTOR INVESTOR
INVESTOR GROWTH & INVESTOR CONSERVATIVE
GROWTH INCOME BALANCED GROWTH
FUND FUND FUND FUND
-------- --------- -------- ------------
ASSETS:
Investments, at value (cost $199,115; $208,652; $184,322;
and $82,599, respectively)................................ $217,257 $226,522 $198,835 $85,494
Cash........................................................ 1,265 819 2,113 357
Dividends receivable........................................ 188 400 535 306
Receivable from brokers for investments sold................ 1,500 1,500 1,000 --
Receivable for capital shares issued........................ 735 1,099 1,472 385
Receivable from advisor..................................... 31 9 -- 26
Prepaid expenses and other assets........................... 1 1 1 7
-------- -------- -------- -------
TOTAL ASSETS................................................ 220,977 230,350 203,956 86,575
-------- -------- -------- -------
LIABILITIES:
Dividends payable........................................... 84 300 463 272
Payable for capital shares redeemed......................... 42 33 55 42
Accrued expenses and other payables:
Investment advisory fees................................ 9 9 8 --
12b-1 fees.............................................. 70 78 64 36
Other................................................... 73 99 88 58
-------- -------- -------- -------
TOTAL LIABILITIES........................................... 278 519 678 408
-------- -------- -------- -------
NET ASSETS:
Capital..................................................... 197,904 207,764 185,728 82,826
Undistributed (distributions in excess of) net investment
income.................................................... 2,138 2,062 1,413 180
Accumulated undistributed net realized gains (losses) from
investment transactions................................... 2,515 2,135 1,624 266
Net unrealized appreciation (depreciation) from
investments............................................... 18,142 17,870 14,513 2,895
-------- -------- -------- -------
NET ASSETS.................................................. $220,699 $229,831 $203,278 $86,167
======== ======== ======== =======
NET ASSETS:
Fiduciary............................................... $ 86,355 $ 98,060 $93,557 $30,352
Class A................................................. 55,057 39,874 32,605 12,538
Class B................................................. 70,515 85,468 70,463 39,489
Class C................................................. 8,772 6,429 6,653 3,788
-------- -------- -------- -------
Total....................................................... $220,699 $229,831 $203,278 $86,167
======== ======== ======== =======
OUTSTANDING UNITS OF BENEFICIAL INTEREST (SHARES):
Fiduciary............................................... 6,451 7,802 7,925 2,745
Class A................................................. 4,130 3,143 2,755 1,136
Class B................................................. 5,237 6,761 5,963 3,575
Class C................................................. 658 513 565 343
-------- -------- -------- -------
Total....................................................... 16,476 18,219 17,208 7,799
======== ======== ======== =======
Net Asset Value:
Fiduciary Offering and redemption price per share....... $ 13.39 $ 12.57 $ 11.81 $ 11.06
======== ======== ======== =======
Class A Redemption price per share...................... $ 13.33 $ 12.69 $ 11.83 $ 11.04
======== ======== ======== =======
Maximum sales charge................................ 4.50% 4.50% 4.50% 4.50%
======== ======== ======== =======
Maximum offering price per share (100%/(100%-maximum
sales charge) of net asset value adjusted to
nearest cent)..................................... $ 13.96 $ 13.29 $ 12.39 $ 11.56
======== ======== ======== =======
Class B Offering price per share (a).................... $ 13.47 $ 12.64 $ 11.82 $ 11.05
======== ======== ======== =======
Class C Offering price per share (a).................... $ 13.34 $ 12.54 $ 11.77 $ 11.03
======== ======== ======== =======
- ------------
(a) Redemption price per Class B and Class C share varies based on length of
time shares are held.
See notes to financial statements.
12
15
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
INVESTOR
INVESTOR INVESTOR GROWTH INVESTOR CONSERVATIVE
GROWTH FUND & INCOME FUND BALANCED FUND GROWTH FUND
----------- --------------- ------------- ------------
INVESTMENT INCOME:
Distribution income........................ $ 1,410 $ 3,175 $ 4,519 $2,126
------- ------- ------- ------
EXPENSES:
Investment advisory fees................... 57 67 65 23
Administration fees........................ 114 134 129 46
12b-1 fees (Class A)....................... 78 64 45 18
12b-1 fees (Class B)....................... 327 391 297 162
12b-1 fees (Class C)....................... 41 24 27 19
Custodian and accounting fees.............. 11 12 10 16
Legal and audit fees....................... 6 7 6 4
Trustees' fees and expenses................ 1 2 2 1
Transfer agent fees........................ 126 105 80 68
Registration and filing fees............... 69 86 90 69
Printing costs............................. 19 26 24 9
Other...................................... 4 4 3 2
------- ------- ------- ------
Total expenses before waivers.............. 853 922 778 437
Less waivers and reimbursements............ (202) (193) (163) (151)
------- ------- ------- ------
Net Expenses............................... 651 729 615 286
------- ------- ------- ------
Net Investment Income...................... 759 2,446 3,904 1,840
------- ------- ------- ------
REALIZED/UNREALIZED GAINS (LOSSES) FROM
INVESTMENTS:
Net realized gains (losses) from investment
transactions............................. 7,240 6,961 5,351 808
Net change in unrealized appreciation
(depreciation) from investments.......... 14,046 14,037 10,033 2,434
------- ------- ------- ------
Net realized/unrealized gains (losses) from
investments.............................. 21,286 20,998 15,384 3,242
------- ------- ------- ------
Change in net assets resulting from
operations............................... $22,045 $23,444 $19,288 $5,082
======= ======= ======= ======
See notes to financial statements.
13
16
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
INVESTOR INVESTOR GROWTH
GROWTH FUND & INCOME FUND
----------------------- -----------------------
YEAR DECEMBER 10, YEAR DECEMBER 10,
ENDED 1996 THROUGH ENDED 1996 THROUGH
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997(a) 1998 1997(a)
-------- ------------ -------- ------------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income............................. $ 759 $ 256 $ 2,446 $ 556
Net realized gains (losses)....................... 7,240 (59) 6,961 (87)
Net change in unrealized appreciation
(depreciation) from investments................ 14,046 4,096 14,037 3,833
-------- ------- -------- -------
Change in net assets resulting from operations........ 22,045 4,293 23,444 4,302
-------- ------- -------- -------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income........................ (544) (227) (1,586) (494)
From net realized gains........................... (1,180) -- (1,513) --
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income........................ (172) (14) (357) (24)
From net realized gains........................... (471) -- (348) --
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income........................ (38) (15) (472) (38)
From net realized gains........................... (776) -- (761) --
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net investment income........................ (5) -- (31) --
From net realized gains........................... (101) -- (55) --
-------- ------- -------- -------
Change in net assets from shareholder distributions... (3,287) (256) (5,123) (556)
-------- ------- -------- -------
CAPITAL TRANSACTIONS:
Proceeds from shares issued....................... 165,696 41,705 177,644 58,244
Proceeds from shares issued in conversion......... 10,702 -- 12,936 --
Dividends reinvested.............................. 2,757 25 3,682 49
Cost of shares redeemed........................... (20,622) (2,359) (39,570) (5,221)
-------- ------- -------- -------
Change in net assets from share transactions.......... 158,533 39,371 154,692 53,072
-------- ------- -------- -------
Change in net assets.................................. 177,291 43,408 173,013 56,818
NET ASSETS:
Beginning of period............................... 43,408 -- 56,818 --
-------- ------- -------- -------
End of period..................................... $220,699 $43,408 $229,831 $56,818
======== ======= ======== =======
SHARE TRANSACTIONS:
Issued............................................ 13,101 4,079 14,884 5,697
Issued in conversion.............................. 922 -- 1,150 --
Reinvested........................................ 232 3 319 4
Redeemed.......................................... (1,634) (227) (3,325) (510)
-------- ------- -------- -------
Change in shares...................................... 12,621 3,855 13,028 5,191
======== ======= ======== =======
- ------------
(a) Period from commencement of operations.
See notes to financial statements.
14
17
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
INVESTOR INVESTOR CONSERVATIVE
BALANCED FUND GROWTH FUND
----------------------- -----------------------
YEAR DECEMBER 10, YEAR DECEMBER 10,
ENDED 1996 THROUGH ENDED 1996 THROUGH
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997(a) 1998 1997(a)
-------- ------------ -------- ------------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income.............................. $ 3,904 $ 1,187 $ 1,840 $ 333
Net realized gains (losses)........................ 5,351 (67) 808 9
Net change in unrealized appreciation
(depreciation) from investments................. 10,033 4,480 2,434 461
-------- ------- ------- -------
Change in net assets resulting from operations......... 19,288 5,600 5,082 803
-------- ------- ------- -------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income......................... (2,708) (1,132) (980) (296)
From net realized gains............................ (1,584) -- (205) --
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income......................... (414) (15) (215) (14)
From net realized gains............................ (185) -- (29) --
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income......................... (717) (40) (572) (23)
From net realized gains............................ (441) -- (120) --
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net investment income......................... (65) -- (67) --
From net realized gains............................ (37) -- (17) --
-------- ------- ------- -------
Change in net assets from shareholder distributions.... (6,151) (1,187) (2,211) (333)
-------- ------- ------- -------
CAPITAL TRANSACTIONS:
Proceeds from shares issued........................ 130,231 78,898 71,233 21,496
Proceeds from shares issued in conversion.......... 6,532 -- 707 --
Dividends reinvested............................... 3,506 49 1,170 41
Cost of shares redeemed............................ (30,131) (3,357) (8,767) (3,054)
-------- ------- ------- -------
Change in net assets from share transactions........... 110,138 75,590 64,343 18,483
-------- ------- ------- -------
Change in net assets................................... 123,275 80,003 67,214 18,953
NET ASSETS:
Beginning of period................................ 80,003 -- 18,953 --
-------- ------- ------- -------
End of period...................................... $203,278 $80,003 $86,167 $18,953
======== ======= ======= =======
SHARE TRANSACTIONS:
Issued............................................. 11,443 7,850 6,600 2,132
Issued in conversion............................... 600 -- 67 --
Reinvested......................................... 315 5 109 5
Redeemed........................................... (2,677) (328) (811) (303)
-------- ------- ------- -------
Change in shares....................................... 9,681 7,527 5,965 1,834
======== ======= ======= =======
- ------------
(a) Period from commencement of operations.
See notes to financial statements.
15
18
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS JUNE 30, 1998
1. ORGANIZATION:
The One Group (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end investment company
established as a Massachusetts business trust. The accompanying financial
statements and financial highlights are those of the Investor Growth Fund,
the Investor Growth & Income Fund, the Investor Balanced Fund and the
Investor Conservative Growth Fund (individually a "Fund", collectively the
"Funds") only.
The Funds' investment objectives are as follows:
FUND OBJECTIVE
---- ---------
Investor Growth Fund Long-term capital appreciation by investing primarily in
a diversified group of The One Group mutual funds which
invest primarily in equity securities.
Investor Growth & Income Fund Long-term capital appreciation and growth of income by
investing primarily in a diversified group of The One
Group mutual funds which invest primarily in equity
securities.
Investor Balanced Fund High total return consistent with the preservation of
capital by investing primarily in a diversified group of
The One Group mutual funds which invest primarily in
equity and fixed income securities.
Investor Conservative Growth Fund Income and capital appreciation by investing primarily in
a diversified group of The One Group mutual funds which
invest primarily in equity and fixed income securities.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Trust in preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for the
period. Actual results could differ from those estimates.
SECURITY VALUATION
Investments in The One Group mutual funds (the "Underlying Funds") are
valued at the closing net asset value per share of each Underlying
Fund on the day of valuation. Short-term investments maturing in 60 days
or less are valued at amortized cost, which approximates market value.
SECURITY TRANSACTIONS AND RELATED INCOME
Purchases and sales of the Underlying Funds are accounted for on a
trade date basis. Net realized gains or losses on sales of the
Underlying Funds are determined on the specific identification cost
method. Other income and expenses are recognized on the accrual basis.
Distributions from the Underlying Funds and dividends to the Funds'
shareholders are recorded on the ex-dividend date.
Continued
16
19
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
EXPENSES
Expenses directly attributable to a Fund are charged directly to that
Fund, while the expenses which are attributable to more than one fund of
the Trust are allocated among the respective Funds. Each class of shares
bears its pro-rata portion of expenses attributable to its series,
except that each class separately bears expenses related specifically to
that class, such as distribution fees.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income are declared and paid monthly for
the Funds. Net realized capital gains, if any, are distributed at least
annually. Dividends are declared separately for each class. No class has
preferential dividend rights; differences in per share dividend rates
are due to differences in separate class expenses.
Distributions from net investment income and from net 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 for expiring capital loss
carryforwards and deferrals of certain losses. Permanent book and tax
basis differences, which affect shareholder distributions, will be
reclassified to additional paid-in capital.
FEDERAL INCOME TAXES
The Trust treats each Fund as a separate entity for Federal income tax
purposes. Each Fund intends to continue to qualify as a regulated
investment company by complying with the provisions available to certain
investment companies as defined in applicable sections of the Internal
Revenue Code, and to make distributions from net investment income and
from net realized capital gains sufficient to relieve it from all, or
substantially all, Federal income taxes.
3. SHARES OF BENEFICIAL INTEREST:
The Trust has an unlimited number of shares of beneficial interest, with no
par value, which may, without shareholder approval, be divided into an
unlimited number of series of such shares and any series may be classified or
reclassified into one or more classes. The Trust is registered to offer forty
series and five classes of shares: Fiduciary Class, Class A, Class B, Class C
and Service Class. Currently, the Trust consists of thirty-three active
Funds. The Funds are each authorized to issue Fiduciary Class, Class A, Class
B and Class C Shares. Class A Shares are subject to initial sales charges,
imposed at the time of purchase, in accordance with the Funds' prospectus.
Certain redemptions of Class B and Class C Shares are subject to contingent
deferred sales charges in accordance with the Funds' prospectus. Shareholders
are entitled to one vote for each full share held and will vote in the
aggregate and not by class or series, except as otherwise expressly required
by law or when the Board of Trustees has determined that the matter to be
voted on affects only the interest of shareholders of a particular class or
series. The following is a summary of transactions in Fund shares for the
fiscal years ended June 30, 1998 and 1997:
Continued
17
20
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
INVESTOR
INVESTOR GROWTH &
GROWTH FUND INCOME FUND
----------------------- -----------------------
YEAR DECEMBER 10, YEAR DECEMBER 10,
ENDED 1996 THROUGH ENDED 1996 THROUGH
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997(a) 1998 1997(a)
-------- ------------ -------- ------------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued............................... $47,160 $30,381 $61,976 $45,181
Proceeds from shares issued in conversion................. 10,702 -- 12,936 --
Dividends reinvested...................................... 1,220 11 1,780 13
Cost of shares redeemed................................... (13,523) (2,252) (32,898) (4,561)
------- ------- ------- -------
Change in net assets from Fiduciary Share transactions.... $45,559 $28,140 $43,794 $40,633
======= ======= ======= =======
CLASS A SHARES:
Proceeds from shares issued............................... $50,360 $ 4,125 $35,814 $ 4,604
Dividends reinvested...................................... 621 7 653 14
Cost of shares redeemed................................... (3,719) (19) (3,170) (606)
------- ------- ------- -------
Change in net assets from Class A Share transactions...... $47,262 $ 4,113 $33,297 $ 4,012
======= ======= ======= =======
CLASS B SHARES:
Proceeds from shares issued............................... $59,863 $ 7,199 $73,655 $ 8,459
Dividends reinvested...................................... 810 7 1,171 22
Cost of shares redeemed................................... (3,085) (88) (3,333) (54)
------- ------- ------- -------
Change in net assets from Class B Share transactions...... $57,588 $ 7,118 $71,493 $ 8,427
======= ======= ======= =======
CLASS C SHARES (b):
Proceeds from shares issued............................... $ 8,313 $ 6,199
Dividends reinvested...................................... 106 78
Cost of shares redeemed................................... (295) (169)
------- -------
Change in net assets from Class C Share transactions...... $ 8,124 $ 6,108
======= =======
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued.................................................... 3,722 3,000 5,278 4,443
Issued in conversion...................................... 922 -- 1,150 --
Reinvested................................................ 103 1 155 1
Redeemed.................................................. (1,080) (217) (2,777) (448)
------- ------- ------- -------
Change in Fiduciary Shares................................ 3,667 2,784 3,806 3,996
======= ======= ======= =======
CLASS A SHARES:
Issued.................................................... 3,973 397 2,960 443
Reinvested................................................ 52 1 56 1
Redeemed.................................................. (291) (2) (260) (57)
------- ------- ------- -------
Change in Class A Shares.................................. 3,734 396 2,756 387
======= ======= ======= =======
CLASS B SHARES:
Issued.................................................... 4,734 682 6,126 811
Reinvested................................................ 68 1 101 2
Redeemed.................................................. (240) (8) (274) (5)
------- ------- ------- -------
Change in Class B Shares.................................. 4,562 675 5,953 808
======= ======= ======= =======
CLASS C SHARES (b):
Issued.................................................... 672 520
Reinvested................................................ 9 7
Redeemed.................................................. (23) (14)
------- -------
Change in Class C Shares.................................. 658 513
======= =======
- ------------
(a) Period from commencement of operations.
(b) Class C shares commenced operations on July 1, 1997.
Continued
18
21
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
INVESTOR
INVESTOR CONSERVATIVE
BALANCED FUND GROWTH FUND
----------------------- -----------------------
YEAR DECEMBER 10, YEAR DECEMBER 10,
ENDED 1996 THROUGH ENDED 1996 THROUGH
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997(a) 1998 1997(a)
-------- ------------ -------- ------------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued............................... $29,880 $71,345 $18,972 $17,645
Proceeds from shares issued in conversion................. 6,532 -- 707 --
Dividends reinvested...................................... 1,866 15 338 18
Cost of shares redeemed................................... (25,609) (3,309) (6,167) (2,999)
-------- ------- ------- -------
Change in net assets from Fiduciary Share transactions.... $12,669 $68,051 $13,850 $14,664
======== ======= ======= =======
CLASS A SHARES:
Proceeds from shares issued............................... $30,496 $ 2,092 $11,834 $ 1,283
Dividends reinvested...................................... 518 9 192 8
Cost of shares redeemed................................... (1,837) -- (1,084) (29)
-------- ------- ------- -------
Change in net assets from Class A Share transactions...... $29,177 $ 2,101 $10,942 $ 1,262
======== ======= ======= =======
CLASS B SHARES:
Proceeds from shares issued............................... $63,523 $ 5,461 $36,712 $ 2,568
Dividends reinvested...................................... 1,034 25 571 15
Cost of shares redeemed................................... (2,638) (48) (1,395) (26)
-------- ------- ------- -------
Change in net assets from Class B Share transactions...... $61,919 $ 5,438 $35,888 $ 2,557
======== ======= ======= =======
CLASS C SHARES (b):
Proceeds from shares issued............................... $ 6,332 $ 3,715
Dividends reinvested...................................... 88 69
Cost of shares redeemed................................... (47) (121)
-------- -------
Change in net assets from Class C Share transactions...... $ 6,373 $ 3,663
======== =======
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued.................................................... 2,648 7,112 1,763 1,750
Issued in conversion...................................... 600 -- 67 --
Reinvested................................................ 169 2 32 2
Redeemed.................................................. (2,282) (324) (572) (297)
-------- ------- ------- -------
Change in Fiduciary Shares................................ 1,135 6,790 1,290 1,455
======== ======= ======= =======
CLASS A SHARES:
Issued.................................................... 2,665 203 1,092 128
Reinvested................................................ 46 1 18 1
Redeemed.................................................. (160) -- (100) (3)
-------- ------- ------- -------
Change in Class A Shares.................................. 2,551 204 1,010 126
======== ======= ======= =======
CLASS B SHARES:
Issued.................................................... 5,569 535 3,397 254
Reinvested................................................ 92 2 53 2
Redeemed.................................................. (231) (4) (128) (3)
-------- ------- ------- -------
Change in Class B Shares.................................. 5,430 533 3,322 253
======== ======= ======= =======
CLASS C SHARES (b):
Issued.................................................... 561 348
Reinvested................................................ 8 6
Redeemed.................................................. (4) (11)
-------- -------
Change in Class C Shares.................................. 565 343
======== =======
- ------------
(a) Period from commencement of operations.
(b) Class C Shares commenced operations on July 1, 1997.
Continued
19
22
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
4. INVESTMENT ADVISORY, ADMINISTRATIVE, AND DISTRIBUTION AGREEMENTS:
The Trust and Banc One Investment Advisors Corporation (the "Advisor") are
parties to an investment advisory agreement under which the Advisor is
entitled to receive an annual fee, computed daily and paid monthly, equal to
0.05% of the average net assets of the Investor Growth Fund, the Investor
Growth & Income Fund, the Investor Balanced Fund and the Investor
Conservative Growth Fund, respectively.
The Trust and The One Group Services Company (the "Administrator"), a
wholly-owned subsidiary of The BISYS Group, Inc., are parties to an
administrative agreement under which the Administrator provides services for
a fee that is computed daily and payable monthly, at an annual rate of 0.10%
on the first $500 million of each Fund's average daily net assets, 0.075% of
each Fund's average daily net assets between $500 million and $1 billion, and
0.05% of each Fund's average daily net assets when Fund assets exceed $1
billion. The Advisor also serves as sub-Administrator to each Fund of the
Trust, pursuant to an agreement between the Administrator and the Advisor.
Pursuant to this agreement, the Advisor performs many of the Administrator's
duties, for which the Advisor receives a fee paid by the Administrator.
The Trust and The One Group Services Company (the "Distributor") are parties
to a distribution agreement under which shares of the Funds are sold on a
continuous basis. Class A, Class B and Class C Shares are subject to a
distribution and shareholder services plan (the "Plans") pursuant to Rule
12b-1 under the 1940 Act. As provided in the Plans, the Trust will pay the
Distributor a fee of 0.35% of the average daily net assets of Class A Shares
of each of the Funds and 1.00% of the average daily net assets of the Class B
and Class C Shares of each of the Funds. Currently, the Distributor has
voluntarily agreed to limit payments under the Plans to 0.25% of average
daily net assets of the Class A Shares of each Fund. Up to 0.25% of the fees
payable under the Plans may be used as compensation for shareholder services
by the Distributor and/or financial institutions and intermediaries. Fees
paid under the Plans may be applied by the Distributor toward (i)
compensation for its services in connection with distribution assistance or
provision of shareholder services; or (ii) payments to financial institutions
and intermediaries such as banks (including affiliates of the Advisor),
brokers, dealers and other institutions, including the Distributor's
affiliates and subsidiaries as compensation for services or reimbursement of
expenses incurred in connection with distribution assistance or provision of
shareholder services. Fiduciary Class Shares of each Fund are offered without
distribution fees. For the year ended June 30, 1998, the Distributor received
$11,735,166 from commissions earned on sales of Class A Shares and
redemptions of Class B and Class C Shares, of which, the Distributor
re-allowed $11,715,655 to affiliated broker-dealers of the Funds.
Certain officers of the Trust are affiliated with the Administrator. Such
officers receive no compensation from the Funds for serving in their
respective roles.
The Advisor, the Administrator and the Distributor voluntarily agreed to
waive a portion of their fees and to reimburse the Funds for certain
expenses. For the year ended June 30, 1998, fees in the following amounts
were waived and reimbursed from the funds (amounts in thousands):
INVESTMENT 12B-1 FEES FEES
ADVISORY FEES ADMINISTRATION WAIVED REIMBURSED BY
WAIVED FEES WAIVED CLASS A ADVISOR
------------- --------------- ---------- -------------
Investor Growth Fund................. $22 $114 $22 $44
Investor Growth & Income Fund........ 18 134 18 23
Investor Balanced Fund............... 12 129 13 9
Investor Conservative Growth Fund.... 19 46 5 81
Continued
20
23
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
5. SECURITIES TRANSACTIONS:
The cost of security purchases and the proceeds from the sale of securities
(excluding short-term securities and purchased options) during the year ended
June 30, 1998 were as follows (amounts in thousands):
PURCHASES SALES
--------- -------
Investor Growth Fund................................... $153,667 $ 4,603
Investor Growth & Income Fund.......................... 171,063 15,032
Investor Balanced Fund................................. 120,907 12,386
Investor Conservative Growth Fund...................... 64,328 1,447
6. CONVERSION OF COMMON TRUST FUNDS:
On December 19, 1997 the net assets of certain common trust funds managed by
the Advisor were exchanged for shares of the corresponding One Group Funds.
The transaction was accounted for by a method followed for tax purposes in a
tax-free business combination. The following is a summary of shares issued,
net assets converted, net asset value per share issued and unrealized
appreciation of assets acquired as of the conversion date (amounts in
thousands except per share amounts):
NET ASSET
SHARES NET ASSETS VALUE PER UNREALIZED
ISSUED CONVERTED SHARE ISSUED APPRECIATION
------ ---------- ------------ ------------
Investor Growth Fund................................. 922 $10,702 $11.61 $--
Investor Growth & Income Fund........................ 1,150 12,936 11.25 --
Investor Balanced Fund............................... 600 6,532 10.89 --
Investor Conservative Growth Fund.................... 67 707 10.56 --
7. FEDERAL TAX INFORMATION (UNAUDITED):
The accompanying table below details distributions from long-term capital
gains for the following funds for the fiscal year ended June 30, 1998
(amounts in thousands):
20% 28%
FUND AMOUNT AMOUNT
---- ------ ------
Investor Growth Fund.................................... $196 $1,246
Investor Growth & Income Fund........................... 204 1,307
Investor Balanced Fund.................................. 167 1,008
Investor Conservative Growth Fund....................... 32 189
ELIGIBLE DISTRIBUTIONS:
The Trust designates the following percentage of distributions eligible for
the dividends received deductions for corporations.
FUND AMOUNT
---- ----------
Investor Growth Fund........................................ 20.66%
Investor Growth & Income Fund............................... 14.84%
Investor Balanced Fund...................................... 10.65%
Investor Conservative Growth Fund........................... 7.14%
Continued
21
24
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
FUND
-----------------------
FIDUCIARY
-----------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 11.25 $ 10.00
------- -------
Investment Activities
Net investment income..................................... 0.12 0.09
Net realized and unrealized gains (losses) from
investments............................................ 2.49 1.25
------- -------
Total from Investment Activities....................... 2.61 1.34
------- -------
Distributions
Net investment income..................................... (0.12) (0.09)
Net realized gains........................................ (0.35) --
------- -------
Total Distributions.................................... (0.47) (0.09)
------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 13.39 $ 11.25
======= =======
Total Return................................................ 23.81% 13.50%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $86,355 $31,318
Ratio of expenses to average net assets................... 0.20% 0.20%(c)
Ratio of net investment income to average net assets...... 1.04% 1.70%(c)
Ratio of expenses to average net assets*.................. 0.36% 0.77%(c)
Ratio of net investment income to average net assets*..... 0.88% 1.13%(c)
Portfolio turnover (d).................................... 4.05% 18.49%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
22
25
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
FUND
-----------------------
CLASS A
-----------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 11.21 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.10 0.07
Net realized and unrealized gains (losses) from
investments............................................ 2.47 1.21
------- ------
Total from Investment Activities....................... 2.57 1.28
------- ------
Distributions
Net investment income..................................... (0.10) (0.07)
Net realized gains........................................ (0.35) --
------- ------
Total Distributions.................................... (0.45) (0.07)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 13.33 $11.21
======= ======
Total Return (Excludes Sales Charge)........................ 23.44% 12.84%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $55,057 $4,439
Ratio of expenses to average net assets................... 0.45% 0.46%(c)
Ratio of net investment income to average net assets...... 0.78% 1.82%(c)
Ratio of expenses to average net assets*.................. 0.70% 1.62%(c)
Ratio of net investment income to average net assets*..... 0.53% 0.66%(c)
Portfolio turnover (d).................................... 4.05% 18.49%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
23
26
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
FUND
-----------------------
CLASS B
-----------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 11.34 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.02 0.04
Net realized and unrealized gains (losses) from
investments............................................ 2.48 1.34
------- ------
Total from Investment Activities....................... 2.50 1.38
------- ------
Distributions
Net investment income..................................... (0.02) (0.04)
Net realized gains........................................ (0.35) --
------- ------
Total Distributions.................................... (0.37) (0.04)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 13.47 $11.34
======= ======
Total Return (Excludes Sales Charge)........................ 22.52% 13.88%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $70,515 $7,651
Ratio of expenses to average net assets................... 1.20% 1.20%(c)
Ratio of net investment income to average net assets...... 0.04% 0.97%(c)
Ratio of expenses to average net assets*.................. 1.35% 2.18%(c)
Ratio of net investment income to average net assets*..... (0.11%) (0.01%)(c)
Portfolio turnover (d).................................... 4.05% 18.49%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
24
27
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
FUND
--------
CLASS C
--------
YEAR
ENDED
JUNE 30,
1998(a)
--------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $11.25
------
Investment Activities
Net investment income..................................... 0.02
Net realized and unrealized gains (losses) from
investments............................................ 2.45
------
Total from Investment Activities....................... 2.47
------
Distributions
Net investment income..................................... (0.03)
Net realized gains........................................ (0.35)
------
Total Distributions.................................... (0.38)
------
NET ASSET VALUE,
END OF PERIOD............................................. $13.34
======
Total Return (Excludes Sales Charge)........................ 22.42%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $8,772
Ratio of expenses to average net assets................... 1.20%
Ratio of net investment income to average net assets...... 0.04%
Ratio of expenses to average net assets*.................. 1.35%
Ratio of net investment income to average net assets*..... (0.11%)
Portfolio turnover (b).................................... 4.05%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations on July 1, 1997.
(b) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
25
28
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
& INCOME
FUND
-----------------------
FIDUCIARY
-----------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.93 $ 10.00
------- -------
Investment Activities
Net investment income..................................... 0.25 0.15
Net realized and unrealized gains (losses) from
investments............................................ 1.92 0.93
------- -------
Total from Investment Activities....................... 2.17 1.08
------- -------
Distributions
Net investment income..................................... (0.25) (0.15)
Net realized gains........................................ (0.28) --
------- -------
Total Distributions.................................... (0.53) (0.15)
------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 12.57 $ 10.93
======= =======
Total Return................................................ 20.34% 10.87%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $98,060 $43,660
Ratio of expenses to average net assets................... 0.20% 0.20%(c)
Ratio of net investment income to average net assets...... 2.17% 2.78%(c)
Ratio of expenses to average net assets*.................. 0.34% 0.66%(c)
Ratio of net investment income to average net assets*..... 2.03% 2.32%(c)
Portfolio turnover (d).................................... 11.38% 18.07%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
26
29
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
& INCOME
FUND
-----------------------
CLASS A
-----------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 11.02 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.22 0.12
Net realized and unrealized gains (losses) from
investments............................................ 1.95 1.02
------- ------
Total from Investment Activities....................... 2.17 1.14
------- ------
Distributions
Net investment income..................................... (0.22) (0.12)
Net realized gains........................................ (0.28) --
------- ------
Total Distributions.................................... (0.50) (0.12)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 12.69 $11.02
======= ======
Total Return (Excludes Sales Charge)........................ 20.18% 11.50%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $39,874 $4,262
Ratio of expenses to average net assets................... 0.45% 0.46%(c)
Ratio of net investment income to average net assets...... 1.91% 2.67%(c)
Ratio of expenses to average net assets*.................. 0.67% 1.26%(c)
Ratio of net investment income to average net assets*..... 1.69% 1.87%(c)
Portfolio turnover (d).................................... 11.38% 18.07%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
27
30
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
& INCOME
FUND
-----------------------
CLASS B
-----------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 11.00 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.14 0.09
Net realized and unrealized gains (losses) from
investments............................................ 1.92 1.00
------- ------
Total from Investment Activities....................... 2.06 1.09
------- ------
Distributions
Net investment income..................................... (0.14) (0.09)
Net realized gains........................................ (0.28) --
------- ------
Total Distributions.................................... (0.42) (0.09)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 12.64 $11.00
======= ======
Total Return (Excludes Sales Charge)........................ 19.13% 11.02%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $85,468 $8,896
Ratio of expenses to average net assets................... 1.20% 1.21%(c)
Ratio of net investment income to average net assets...... 1.15% 1.94%(c)
Ratio of expenses to average net assets*.................. 1.32% 1.89%(c)
Ratio of net investment income to average net assets*..... 1.03% 1.26%(c)
Portfolio turnover (d).................................... 11.38% 18.07%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
28
31
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
GROWTH
& INCOME
FUND
--------
CLASS C
--------
YEAR
ENDED
JUNE 30,
1998(a)
--------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $10.93
------
Investment Activities
Net investment income..................................... 0.14
Net realized and unrealized gains (losses) from
investments............................................ 1.90
------
Total from Investment Activities....................... 2.04
------
Distributions
Net investment income..................................... (0.15)
Net realized gains........................................ (0.28)
------
Total Distributions.................................... (0.43)
------
NET ASSET VALUE,
END OF PERIOD............................................. $12.54
======
Total Return (Excludes Sales Charge)........................ 19.08%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $6,429
Ratio of expenses to average net assets................... 1.20%
Ratio of net investment income to average net assets...... 1.14%
Ratio of expenses to average net assets*.................. 1.31%
Ratio of net investment income to average net assets*..... 1.03%
Portfolio turnover (b).................................... 11.38%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations on July 1, 1997.
(b) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
29
32
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
BALANCED
FUND
------------------------
FIDUCIARY
------------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.63 $ 10.00
------- -------
Investment Activities
Net investment income..................................... 0.37 0.21
Net realized and unrealized gains (losses) from
investments............................................ 1.39 0.63
------- -------
Total from Investment Activities....................... 1.76 0.84
------- -------
Distributions
Net investment income..................................... (0.36) (0.21)
Net realized gains........................................ (0.22) --
------- -------
Total Distributions.................................... (0.58) (0.21)
------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 11.81 $ 10.63
======= =======
Total Return................................................ 17.02% 8.48%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $93,557 $72,155
Ratio of expenses to average net assets................... 0.20% 0.20%(c)
Ratio of net investment income to average net assets...... 3.31% 3.84%(c)
Ratio of expenses to average net assets*.................. 0.32% 0.56%(c)
Ratio of net investment income to average net assets*..... 3.19% 3.48%(c)
Portfolio turnover (d).................................... 9.71% 12.20%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
30
33
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
BALANCED
FUND
------------------------
CLASS A
------------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.66 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.34 0.17
Net realized and unrealized gains (losses) from
investments............................................ 1.39 0.66
------- ------
Total from Investment Activities....................... 1.73 0.83
------- ------
Distributions
Net investment income..................................... (0.34) (0.17)
Net realized gains........................................ (0.22) --
------- ------
Total Distributions.................................... (0.56) (0.17)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 11.83 $10.66
======= ======
Total Return (Excludes Sales Charge)........................ 16.62% 8.41%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $32,605 $2,176
Ratio of expenses to average net assets................... 0.45% 0.47%(c)
Ratio of net investment income to average net assets...... 3.01% 3.78%(c)
Ratio of expenses to average net assets*.................. 0.66% 1.12%(c)
Ratio of net investment income to average net assets*..... 2.80% 3.13%(c)
Portfolio turnover (d).................................... 9.71% 12.20%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
31
34
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
BALANCED
FUND
------------------------
CLASS B
------------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.65 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.26 0.16
Net realized and unrealized gains (losses) from
investments............................................ 1.39 0.65
------- ------
Total from Investment Activities....................... 1.65 0.81
------- ------
Distributions
Net investment income..................................... (0.26) (0.16)
Net realized gains........................................ (0.22) --
------- ------
Total Distributions.................................... (0.48) (0.16)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 11.82 $10.65
======= ======
Total Return (Excludes Sales Charge)........................ 15.85% 8.22%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $70,463 $5,672
Ratio of expenses to average net assets................... 1.20% 1.22%(c)
Ratio of net investment income to average net assets...... 2.26% 2.93%(c)
Ratio of expenses to average net assets*.................. 1.31% 1.73%(c)
Ratio of net investment income to average net assets*..... 2.15% 2.42%(c)
Portfolio turnover (d).................................... 9.71% 12.20%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
32
35
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
BALANCED
FUND
--------
CLASS C
--------
YEAR
ENDED
JUNE 30,
1998(a)
--------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $10.63
------
Investment Activities
Net investment income..................................... 0.26
Net realized and unrealized gains (losses) from
investments............................................ 1.37
------
Total from Investment Activities....................... 1.63
------
Distributions
Net investment income..................................... (0.27)
Net realized gains........................................ (0.22)
------
Total Distributions.................................... (0.49)
------
NET ASSET VALUE,
END OF PERIOD............................................. $11.77
======
Total Return (Excludes Sales Charge)........................ 15.66%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $6,653
Ratio of expenses to average net assets................... 1.20%
Ratio of net investment income to average net assets...... 2.24%
Ratio of expenses to average net assets*.................. 1.30%
Ratio of net investment income to average net assets*..... 2.14%
Portfolio turnover (b).................................... 9.71%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations on July 1, 1997.
(b) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
33
36
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
CONSERVATIVE
GROWTH FUND
------------------------
FIDUCIARY
------------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.33 $ 10.00
------- -------
Investment Activities
Net investment income..................................... 0.46 0.26
Net realized and unrealized gains (losses) from
investments............................................ 0.82 0.33
------- -------
Total from Investment Activities....................... 1.28 0.59
------- -------
Distributions
Net investment income..................................... (0.45) (0.26)
Net realized gains........................................ (0.10) --
------- -------
Total Distributions.................................... (0.55) (0.26)
------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 11.06 $ 10.33
======= =======
Total Return................................................ 12.73% 6.00%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $30,352 $15,038
Ratio of expenses to average net assets................... 0.20% 0.20%(c)
Ratio of net investment income to average net assets...... 4.43% 4.92%(c)
Ratio of expenses to average net assets*.................. 0.56% 1.46%(c)
Ratio of net investment income to average net assets*..... 4.07% 3.66%(c)
Portfolio turnover (d).................................... 3.22% 28.46%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
34
37
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
CONSERVATIVE
GROWTH FUND
------------------------
CLASS A
------------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.32 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.43 0.22
Net realized and unrealized gains (losses) from
investments............................................ 0.82 0.32
------- ------
Total from Investment Activities....................... 1.25 0.54
------- ------
Distributions
Net investment income..................................... (0.43) (0.22)
Net realized gains........................................ (0.10) --
------- ------
Total Distributions.................................... (0.53) (0.22)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 11.04 $10.32
======= ======
Total Return (Excludes Sales Charge)........................ 12.38% 5.46%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $12,538 $1,299
Ratio of expenses to average net assets................... 0.45% 0.47%(c)
Ratio of net investment income to average net assets...... 4.12% 4.76%(c)
Ratio of expenses to average net assets*.................. 0.82% 3.05%(c)
Ratio of net investment income to average net assets*..... 3.75% 2.18%(c)
Portfolio turnover (d).................................... 3.22% 28.46%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
35
38
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
CONSERVATIVE
GROWTH FUND
------------------------
CLASS B
------------------------
YEAR DECEMBER 10,
ENDED 1996 THROUGH
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.33 $10.00
------- ------
Investment Activities
Net investment income..................................... 0.37 0.19
Net realized and unrealized gains (losses) from
investments............................................ 0.81 0.33
------- ------
Total from Investment Activities....................... 1.18 0.52
------- ------
Distributions
Net investment income..................................... (0.36) (0.19)
Net realized gains........................................ (0.10) --
------- ------
Total Distributions.................................... (0.46) (0.19)
------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 11.05 $10.33
======= ======
Total Return (Excludes Sales Charge)........................ 11.53% 5.30%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $39,489 $2,616
Ratio of expenses to average net assets................... 1.20% 1.21%(c)
Ratio of net investment income to average net assets...... 3.37% 4.06%(c)
Ratio of expenses to average net assets*.................. 1.47% 3.52%(c)
Ratio of net investment income to average net assets*..... 3.10% 1.75%(c)
Portfolio turnover (d).................................... 3.22% 28.46%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
36
39
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INVESTOR
CONSERVATIVE
GROWTH FUND
------------
CLASS C
------------
YEAR
ENDED
JUNE 30,
1998(a)
------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $10.33
------
Investment Activities
Net investment income..................................... 0.35
Net realized and unrealized gains (losses) from
investments............................................ 0.81
------
Total from Investment Activities....................... 1.16
------
Distributions
Net investment income..................................... (0.36)
Net realized gains........................................ (0.10)
------
Total Distributions.................................... (0.46)
------
NET ASSET VALUE,
END OF PERIOD............................................. $11.03
======
Total Return (Excludes Sales Charge)........................ 11.48%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $3,788
Ratio of expenses to average net assets................... 1.20%
Ratio of net investment income to average net assets...... 3.39%
Ratio of expenses to average net assets*.................. 1.47%
Ratio of net investment income to average net assets*..... 3.12%
Portfolio turnover (b).................................... 3.22%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations on July 1, 1997.
(b) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
37
40
- --------------------------------------------------------------------------------
Report of Independent Accountants
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
To the Shareholders and Board of Trustees of
The One Group Family of Mutual Funds:
In our opinion, the accompanying statements of assets and liabilities, including
the portfolios of investments, and related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Investor Growth Fund, the
Investor Growth and Income Fund, the Investor Balanced Fund and the Investor
Conservative Growth Fund (four series of The One Group Family of Mutual Funds),
at June 30, 1998, the results of each of their operations for the period then
ended, the changes in each of their net assets for the periods presented and the
financial highlights for each of the periods presented, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of The One Group Family of Mutual Funds' management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at June
30, 1998 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PricewaterhouseCoopers LLP
August 18, 1998
38
41
Important Customer Information.
Please Read:
Shares of The One Group:
- - are not deposits or obligations
of, or guaranteed by BANC One
CORPORATION or its affiliates
- - are not insured or guaranteed by the
FDIC or by any other governmental
agency or government-sponsored
agency of the federal government
or any state
- - are subject to investment risks,
including possible loss of the
principal amount invested.
Banc One Investment Advisors
Corporation, a registered investment
advisor and an indirect subsidiary of
BANC ONE CORPORATION, serves
as an investment advisor to The One
Group, for which it receives advisory
fees. The One Group is distributed by
The One Group Services Company,
3435 Stelzer Road, Columbus,
Ohio 43219, which is not affiliated
with BANC ONE CORPORATION and
is not a bank. Contact us at our web
site address: www.onegroup.com or
e-mail us at onegroup@onegroup.com
For more complete information on
any of The One Group Funds, includ-
ing management fees and expenses,
you may obtain a prospectus from
The One Group Services Company.
Read the prospectus carefully
before investing.
BANC ONE
INVESTMENT
ADVISORS
CORPORATION
[BANC ONE LOGO]
42
Institutional Money
Market Funds
Annual Report
For the year ended June 30, 1998
Treasury Only Money Market Fund
Government Money Market Fund
THE ONE GROUP
----------------------
FAMILY OF MUTUAL FUNDS
43
IMPORTANT CUSTOMER INFORMATION. INVESTMENT PRODUCTS:
- are not deposits or obligations of, or guaranteed by,
BANC ONE CORPORATION or any of its affiliates, [FDIC LOGO
WITH SLASH
- are not insured by the FDIC, and THOUGH IT]
- are subject to investment risks, including possible
loss of the principal amount invested.
44
- --------------------------------------------------------------------------------
Table of Contents
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Portfolio Performance Review...................................................2
Schedules of Portfolio Investments.............................................4
Statements of Assets and Liabilities...........................................7
Statements of Operations.......................................................8
Statements of Changes in Net Assets............................................9
Notes to Financial Statements.................................................10
Financial Highlights..........................................................13
Report of Independent Accountants.............................................15
1
45
The One Group Treasury Only Money Market Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The seven-day yield on The One Group Treasury Only Money Market Fund was 5.04%
on June 30, 1998, down slightly from 5.12% on June 30, 1997.
WHAT CONTRIBUTED TO THE FUND'S FAIRLY STABLE YIELD?
The Fund's yield reflects the relative stability in interest rates brought on by
the Federal Reserve's unchanged monetary policy. Rate movements during the year
were fairly moderate. They reflected changing views on economic strength and
whether that strength would lead to inflationary pressures requiring Federal
Reserve action.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
The portfolio continued to benefit from a "barbell" maturity structure, a common
technique that involves investing in securities at the long and short ends of a
particular maturity range instead of those with intermediate maturities.
This strategy led to an average maturity of 49 days on June 30, 1998, enabling
the Fund to maintain its "AAA" average quality rating--the best possible--from
Standard & Poor's and Moody's Investors Service. This rating indicates that the
Fund's securities are of the highest quality and offer the lowest risk. In order
to receive this rating, a fund must have an average maturity no greater than 60
days.
WHAT IS YOUR OUTLOOK FOR THE FUND?
Economic activity and its influences on Federal Reserve policies may have a
direct effect on the Fund over the next year. Over the near term, strong
domestic demand is likely to be offset by the Asian crisis. This will require
the Federal Reserve to be diligent in directing monetary policy. This outlook
warrants continued caution so the Fund can be positioned to benefit from any
action the Federal Reserve may take.
/s/ Andrew T. Linton
Andrew T. Linton
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed Income Securities
AVERAGE ANNUAL
TOTAL RETURN
7 DAY YIELD 1 YEAR 5 YEARS SINCE INCEPTION
5.04% 5.30% 4.87% 4.80%
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
2
46
The One Group Government Money Market Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The seven-day yield on The One Group Government Money Market Fund was 5.56% on
June 30, 1998, up slightly from 5.30% on June 30, 1997.
WHAT CONTRIBUTED TO THE FUND'S FAIRLY STABLE YIELD?
The Fund's yield reflects the relative rate stability caused by the Federal
Reserve's unchanged monetary policy. Rate movements throughout the year were
fairly moderate. They reflected changing views on economic strength and whether
that strength would lead to inflationary pressures requiring Federal Reserve
action.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
The Fund was invested primarily in agency securities because they offered a
yield advantage of 10 to 15 basis points over Treasuries and repurchase
agreements (one basis point equals 1/100th of a percent). The Fund also held
between 15% and 20% of its assets in floating-rate securities, which offered
yields that changed on a weekly basis. This position helped the Fund quickly
take advantage of rising interest rates.
The portfolio continued to benefit from a "barbell" maturity structure, a common
strategy that involves favoring securities at the long and short ends of a
particular maturity range over those with intermediate maturities. At the "long"
end, we purchased securities with maturities of six months to one year, and at
the "short" end, we held overnight repurchase agreements. The longer securities
allowed the Fund to benefit from the steepness of the yield curve (which occurs
when securities with longer maturities offer relatively higher yields), while
the overnight securities helped the Fund maintain a high degree of liquidity.
The Fund's barbell structure contributed to an average maturity of 37 days on
June 30, 1998, compared to 72 days on June 30, 1997.
WHAT IS YOUR OUTLOOK FOR THE FUND?
Economic activity and its influences on Federal Reserve policies may have a
direct effect on the Fund over the next year. Over the near term, strong
domestic demand is likely to be offset by the Asian crisis. This will require
the Federal Reserve to be diligent in directing monetary policy. This outlook
warrants continued caution so the Fund can be positioned to benefit from any
action the Federal Reserve may take.
/s/ Andrew T. Linton
Andrew T. Linton
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed Income Securities
AVERAGE ANNUAL
TOTAL RETURN
7 DAY YIELD 1 YEAR 5 YEARS SINCE INCEPTION
5.56% 5.64% 5.09% 5.08%
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
3
47
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Treasury Only Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
U.S. TREASURY OBLIGATIONS (99.3%):
U.S. Treasury Bills (51.7%):
$ 41,934 7/2/98 (b)......................... $ 41,928
2,117 7/16/98............................ 2,113
69,586 7/23/98 (b)........................ 69,382
6,545 8/6/98............................. 6,513
141,005 8/20/98............................ 140,053
63,760 9/10/98............................ 63,139
32,232 9/17/98 (b)........................ 31,879
6,860 10/1/98............................ 6,772
1,835 10/15/98........................... 1,808
8,940 11/12/98........................... 8,765
--------
372,352
--------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
U.S. TREASURY OBLIGATIONS, CONTINUED:
U.S. Treasury Notes (47.6%):
$115,000 6.25%, 7/31/98 (b)................. $115,102
52,000 5.25%, 7/31/98..................... 52,010
30,000 9.25%, 8/15/98..................... 30,144
40,088 5.88%, 8/15/98..................... 40,113
27,630 6.13%, 8/31/98 (b)................. 27,657
51,102 6.00%, 9/30/98..................... 51,177
15,994 5.88%, 3/31/99..................... 16,039
10,000 7.00%, 4/15/99..................... 10,108
--------
342,350
--------
Total U.S. Treasury Obligations 714,702
--------
Total (Amortized Cost $714,702) (a) $714,702
========
- ------------
Percentages indicated are based on net assets of $719,570.
(a) Represents cost for financial reporting purposes and differs from cost for
federal income tax by $1.
(b) A portion of this security was loaned as of June 30, 1998.
See notes to financial statements.
4
48
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Government Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ------------------------------------ ----------
U.S. GOVERNMENT AGENCY SECURITIES (22.2%):
Federal Farm Credit Bank (1.9%):
$ 25,000 5.60%, 10/1/98...................... $ 24,987
25,000 5.53%, 10/1/98...................... 24,999
20,000 5.50%, 4/1/99....................... 19,976
----------
69,962
----------
Federal Home Loan Bank (7.3%):
25,000 5.80%, 9/18/98...................... 25,004
7,550 5.69%, 10/2/98...................... 7,551
20,000 5.68%, 10/16/98..................... 19,996
10,000 5.60%, 10/23/98*.................... 9,999
25,000 5.84%, 12/17/98..................... 24,994
40,000 5.55%, 3/23/99...................... 39,992
25,000 5.56%, 3/25/99...................... 24,984
54,000 5.50%, 3/26/99...................... 53,956
45,000 5.63%, 4/9/99....................... 44,979
20,000 5.63%, 5/5/99....................... 19,989
----------
271,444
----------
Federal National Mortgage Assoc. (9.0%):
25,000 5.72%, 8/28/98...................... 25,004
20,000 5.71%, 9/9/98....................... 19,995
10,000 5.65%, 11/4/98*..................... 9,999
40,000 5.37%, 12/30/98..................... 38,914
10,000 5.38%, 2/9/99....................... 9,988
20,000 5.41%, 2/23/99...................... 19,985
25,000 5.37%, 2/26/99...................... 24,963
40,000 5.53%, 3/16/99*..................... 39,986
14,000 5.45%, 4/15/99...................... 13,976
50,000 5.34%, 4/23/99...................... 47,805
50,000 5.63%, 5/5/99....................... 49,952
4,000 5.26%, 6/2/99*...................... 4,000
20,000 5.26%, 7/26/99*..................... 20,000
10,000 5.26%, 9/22/99*..................... 10,000
----------
334,567
----------
Student Loan Marketing Assoc. (4.0%):
104,000 5.32%, 9/28/98*..................... 103,942
25,000 5.32%, 11/10/98*.................... 25,000
10,000 5.34%, 1/13/99*..................... 10,000
10,000 5.35%, 8/2/99*...................... 9,998
----------
148,940
----------
Total U.S. Government Agency Securities 824,913
----------
U.S. TREASURY OBLIGATIONS (1.4%):
U.S. Treasury Notes (1.4%):
25,000 5.25%, 7/31/98 (b).................. 24,993
25,000 8.88%, 2/15/99...................... 25,502
----------
Total U.S. Treasury Obligations 50,495
----------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ------------------------------------ ----------
REPURCHASE AGREEMENTS (77.3%):
$ 150,000 Barclays De Zoette Wedd, 6.00%,
7/1/98 (Collateralized by $150,249
various U.S. Government
Securities, 5.52% - 7.85%,
6/10/99 - 2/15/08, market value
$153,001)......................... $ 150,000
150,000 Donaldson, Lufkin & Jenrette, 5.85%,
7/1/98 (Collateralized by $150,892
various U.S. Government
Securities, 0.00% - 9.05%,
7/7/98 - 4/23/08, market value
$153,001)......................... 150,000
900,000 Goldman Sachs, 6.25%, 7/1/98
(Collateralized by $1,905,451
various U.S. Government
Securities, 5.10% - 8.58%,
1/1/08 - 2/1/38, market value
$918,000)......................... 900,000
150,000 HSBC Securities, 5.90%, 7/1/98
(Collateralized by $154,534
various U.S. Government
Securities, 0.00% - 6.53%,
7/1/98 - 4/15/08, market value
$153,004)......................... 150,000
25,000 HSBC Securities, 5.80%, 7/1/98
(Collateralized by $25,075 various
U.S. Government Securities,
0.00% - 10.35%, 7/6/98 - 12/10/15,
market value $25,504)............. 25,000
600,000 J.P. Morgan Securities, 6.10%,
7/1/98 (Collateralized by
$1,697,988 various U.S. Government
Securities, 8.50% - 9.00%,
3/15/09 - 2/15/28, market value
$618,000)......................... 600,000
300,000 J.P. Morgan Securities, 6.00%,
7/1/98 (Collateralized by $302,773
various U.S. Government
Securities, 0.00% - 9.55%,
7/6/98 - 4/17/28, market value
$306,000)......................... 300,000
150,000 Lehman Brothers Holdings, Inc.,
5.90%, 7/1/98 (Collateralized by
$159,325 various U.S. Government
Securities, 0.00% - 7.32%,
9/25/98 - 12/27/14, market value
$152,985)......................... 150,000
175,000 Prudential Securities, 6.10%, 7/1/98
(Collateralized by $190,099
various U.S. Government
Securities, 0.00% - 8.90%,
7/1/98 - 6/15/44, market value
$178,501)......................... 175,000
150,000 Societe Generale, 6.15%, 7/1/98
(Collateralized by $263,084
various U.S. Government
Securities, 8.50% - 9.00%,
11/15/17 - 10/15/26, market value
$157,220)......................... 150,000
Continued
5
49
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Government Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ------------------------------------ ----------
REPURCHASE AGREEMENTS, CONTINUED:
$ 25,000 Societe Generale, 5.75%, 7/1/98
(Collateralized by $62,000 various
U.S. Government Securities,
7.46% - 7.76%, 7/1/25 - 2/1/27,
market value $26,732)............. $ 25,000
94,646 Westdeutsche Landesbank, 5.75%,
7/1/98 (Collateralized by $97,553
various U.S. Government
Securities, 6.50%, 6/1/28, market
value $97,575).................... 94,646
----------
Total Repurchase Agreements 2,869,646
----------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ------------------------------------ ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL (0.7%):
$ 26,066 Paine Webber, Repurchase Agreement,
6.15%, 7/1/98 (Collateralized by
$26,162 various U.S. Government
Securities, 0.00% - 9.35%,
9/25/98 - 9/18/27, market value
$26,608).......................... $ 26,066
----------
Total Short-Term Securities Held as Collateral 26,066
----------
Total (Amortized Cost $3,771,120) (a) $3,771,120
==========
- ------------
Percentages indicated are based on net assets of $3,712,252.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
(b) A portion of this security was loaned as of June 30, 1998.
* Securities having interest rates that reset weekly based on the U.S. Treasury
Bill auctions. The rate reflected on the Schedule of Portfolio Investments is
the rate in effect at June 30, 1998.
See notes to financial statements.
6
50
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
TREASURY ONLY GOVERNMENT
MONEY MARKET MONEY MARKET
FUND FUND
------------- -------------
ASSETS:
Investments, at amortized cost.............................. $714,702 $ 875,408
Repurchase agreements, at cost.............................. -- 2,895,712
-------- ----------
Total.................................................. 714,702 3,771,120
Cash........................................................ 1 --
Interest receivable......................................... 7,812 9,642
Prepaid expenses and other assets........................... 9 7
-------- ----------
TOTAL ASSETS................................................ 722,524 3,780,769
-------- ----------
LIABILITIES:
Dividends payable........................................... 2,833 16,861
Payable to brokers for investments purchased................ -- 25,000
Payable for return of collateral received for securities on
loan...................................................... -- 26,066
Accrued expenses and other payables:
Investment advisory fees............................... 45 246
Administration fees.................................... 28 154
Other.................................................. 48 190
-------- ----------
TOTAL LIABILITIES........................................... 2,954 68,517
-------- ----------
NET ASSETS:
Capital..................................................... 719,663 3,712,374
Accumulated undistributed net realized gains (losses) from
investment transactions................................... (93) (122)
-------- ----------
NET ASSETS.................................................. $719,570 $3,712,252
======== ==========
Outstanding shares of beneficial interest................... 719,663 3,712,374
======== ==========
Net Asset Value:
Offering and redemption price per share................... $1.00 $1.00
======== ==========
See notes to financial statements.
7
51
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
TREASURY ONLY GOVERNMENT
MONEY MARKET MONEY MARKET
FUND FUND
------------- -------------
INVESTMENT INCOME:
Interest income............................................. $34,333 $122,173
Income from securities lending.............................. 212 14
------- --------
TOTAL INCOME................................................ 34,545 122,187
------- --------
EXPENSES:
Investment advisory fees.................................... 519 1,735
Administration fees......................................... 324 1,085
Custodian and accounting fees............................... 31 105
Legal and audit fees........................................ 18 67
Organization costs.......................................... 4 20
Trustees' fees and expenses................................. 8 28
Transfer agent fees......................................... 10 11
Registration and filing fees................................ 36 186
Printing costs.............................................. 11 37
Other....................................................... 28 23
------- --------
TOTAL EXPENSES.............................................. 989 3,297
------- --------
Net Investment Income....................................... 33,556 118,890
------- --------
REALIZED GAINS (LOSSES) FROM INVESTMENT TRANSACTIONS:
Net realized gains (losses) from investment transactions.... (1) 62
------- --------
Change in net assets resulting from operations.............. $33,555 $118,952
======= ========
See notes to financial statements.
8
52
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
TREASURY ONLY MONEY GOVERNMENT MONEY
MARKET FUND MARKET FUND
------------------------- -------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
----------- ----------- ----------- -----------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income........................ $ 33,556 $ 24,629 $ 118,890 $ 56,288
Net realized gains (losses) from investment
transactions............................... (1) (16) 62 (119)
----------- ----------- ----------- -----------
Change in net assets resulting from operations.... 33,555 24,613 118,952 56,169
----------- ----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income................... (33,556) (24,629) (118,890) (56,288)
----------- ----------- ----------- -----------
Change in net assets from shareholder
distributions................................... (33,556) (24,629) (118,890) (56,288)
----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
Proceeds from shares issued.................. 2,224,094 1,603,666 10,068,682 4,075,935
Dividends reinvested......................... 2,709 3,409 16,460 11,375
Cost of shares redeemed...................... (1,988,092) (1,542,160) (7,456,390) (3,859,366)
----------- ----------- ----------- -----------
Change in net assets from share transactions...... 238,711 64,915 2,628,752 227,944
----------- ----------- ----------- -----------
Change in net assets.............................. 238,710 64,899 2,628,814 227,825
NET ASSETS:
Beginning of period.......................... 480,860 415,961 1,083,438 855,613
----------- ----------- ----------- -----------
End of period................................ $ 719,570 $ 480,860 $ 3,712,252 $ 1,083,438
=========== =========== =========== ===========
SHARE TRANSACTIONS:
Issued....................................... 2,224,095 1,603,664 10,068,682 4,075,935
Reinvested................................... 2,710 3,409 16,459 11,375
Redeemed..................................... (1,988,092) (1,542,160) (7,456,390) (3,859,366)
----------- ----------- ----------- -----------
Change in shares.................................. 238,713 64,913 2,628,751 227,944
=========== =========== =========== ===========
See notes to financial statements.
9
53
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS JUNE 30, 1998
1. ORGANIZATION:
The One Group (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end investment company
established as a Massachusetts business trust. The accompanying financial
statements and financial highlights are those of the Treasury Only Money
Market Fund and the Government Money Market Fund (individually a "Fund",
collectively the "Funds") only. The Funds are diversified mutual funds and
are not offered in multiple classes.
The Funds' investment objectives are as follows:
FUND OBJECTIVE
---- ---------
Treasury Only Money Market Fund High current income with liquidity and stability of
principal.
Government Money Market Fund High current income with liquidity and stability of
principal.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for the
period. Actual results could differ from those estimates.
SECURITY VALUATION
Securities are valued utilizing the amortized cost method permitted in
accordance with Rule 2a-7 under the 1940 Act. Under the amortized cost
method, discount or premium is amortized on a constant basis to the
maturity of the security. In addition, the Funds may not (a) purchase
any instrument with a remaining maturity greater than 397 days unless
such instrument is subject to a demand feature, or (b) maintain a
dollar-weighted average maturity which exceeds 90 days.
REPURCHASE AGREEMENTS
The Government Money Market Fund may invest in repurchase agreements
with institutions that are deemed by Banc One Investment Advisors
Corporation (the "Advisor") to be of good standing and creditworthy
under guidelines established by the Board of Trustees. Each repurchase
agreement is recorded at cost. The Fund requires that the securities
purchased in a repurchase agreement transaction be transferred to the
custodian in a manner sufficient to enable the Fund to obtain those
securities in the event of a counterparty default. The seller, under the
repurchase agreement, is required to maintain the value of the
securities held at not less than the repurchase price, including accrued
interest. Repurchase agreements are considered to be loans by a fund
under the 1940 Act.
SECURITY TRANSACTIONS AND RELATED INCOME
Security transactions are accounted for on a trade date basis. Net
realized gains or losses from sales of securities are determined on the
specific identification cost method. Interest income and expenses are
recognized on the accrual basis. Interest income, including any discount
or premium, is accrued as earned using the effective interest method.
Continued
10
54
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
SECURITIES LENDING
To generate additional income, the Funds may lend up to 33% of
securities in which they are invested pursuant to agreements requiring
that the loan be continuously secured by cash, U.S. Government or U.S.
Government Agency securities, shares of an investment trust or mutual
fund, or any combination of cash and such securities as collateral equal
at all times to at least 100% of the market value plus accrued interest
on the securities lent. The Funds continue to earn interest on
securities lent while simultaneously seeking to earn interest on the
investment of collateral. Collateral is marked to market daily to
provide a level of collateral at least equal to the market value of
securities lent. There may be risks of delay in recovery of the
securities or even loss of rights in the collateral should the borrower
of the securities fail financially. However, loans will be made only to
borrowers deemed by the Advisor to be of good standing and creditworthy
under guidelines established by the Board of Trustees and when, in the
judgment of the Advisor, the consideration which can be earned currently
from such securities loans justifies the attendant risks. Loans are
subject to termination by the Funds or the borrower at any time, and
are, therefore, not considered to be illiquid investments. As of
June 30, 1998, the following Funds had securities with the following
amortized cost on loan (amounts in thousands):
AMORTIZED COST AMORTIZED COST AMORTIZED COST
OF CASH OF NON-CASH OF LOANED
COLLATERAL COLLATERAL SECURITIES
-------------- -------------- --------------
Treasury Only Money Market Fund......... -- $144,935 $137,437
Government Money Market Fund............ $26,066 -- $ 25,551
The loaned securities were fully collateralized by cash and U.S.
Government securities as of June 30, 1998.
EXPENSES
Expenses directly attributable to a Fund are charged directly to that
Fund, while the expenses which are attributable to more than one fund of
the Trust are allocated among the respective Funds.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income are declared daily and paid monthly.
Net investment income for this purpose consists of interest accrued and
discount earned (including both original issue discount and market
discount) less amortization of any market premium and accrued expenses.
Net realized capital gains, if any, are distributed at least annually.
Distributions from net investment income and from net 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 for expiring capital loss
carryforwards and deferrals of certain losses. Permanent book and tax
basis differences, if any, have been reclassified among the components of
net assets.
FEDERAL INCOME TAXES
The Trust treats each Fund as a separate entity for Federal income tax
purposes. Each Fund intends to continue to qualify as a regulated
investment company by complying with the provisions available to certain
investment companies as defined in applicable sections of the Internal
Revenue Code, and to make distributions of net investment income and net
realized capital gains sufficient to relieve it from all, or
substantially all, Federal income taxes.
Continued
11
55
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
3. SHARES OF BENEFICIAL INTEREST:
The Trust has an unlimited number of shares of beneficial interest, with no
par value, which may, without shareholder approval, be divided into an
unlimited number of series of such shares and any series may be classified or
reclassified into one or more classes. The Trust is registered to offer forty
series and five classes of shares: Fiduciary, Class A, Class B, Class C and
Service Class. Currently, the Trust consists of thirty-three active Funds,
and not all Funds offer all classes of shares. Shareholders are entitled to
one vote for each full share held and will vote in the aggregate and not by
class or series, except as otherwise expressly required by law or when the
Board of Trustees has determined that the matter to be voted on affects only
the interest of shareholders of a particular class or series.
4. INVESTMENT ADVISORY, ADMINISTRATIVE AND DISTRIBUTION AGREEMENTS:
The Trust and Advisor are parties to an investment advisory agreement under
which the Advisor is entitled to receive a fee, computed daily and paid
monthly, equal to 0.08% of the average daily net assets of each Fund.
The Trust and The One Group Services Company (the "Administrator"), a
wholly-owned subsidiary of The BISYS Group, Inc., are parties to an
administrative agreement under which the Administrator provides services for
a fee that is computed daily and paid monthly at an annual rate of 0.05% of
each Fund's average daily net assets. The Advisor also serves as
Sub-Administrator to each fund of the Trust, pursuant to an agreement between
the Administrator and the Advisor. Pursuant to this agreement, the Advisor
performs many of the Administrator's duties, for which the Advisor receives a
fee paid by the Administrator.
The One Group Services Company (the "Distributor") and the Trust are parties
to a distribution agreement under which shares of the Funds are sold on a
continuous basis. No compensation is paid to the Distributor for distribution
services for the Funds.
Certain officers of the Trust are affiliated with the Administrator. Such
officers receive no compensation from the Funds for serving in their
respective roles.
5. FEDERAL TAX INFORMATION (UNAUDITED):
At June 30, 1998 the following Funds have capital loss carryforwards which
are available to offset future capital gains, if any (amounts in thousands):
FUND AMOUNT EXPIRES
- ---- ------ -------
Treasury Only Money Market Fund........................... $ 17 2004
Treasury Only Money Market Fund........................... 67 2005
Treasury Only Money Market Fund........................... 9 2006
Government Money Market Fund.............................. 4 2004
Government Money Market Fund.............................. 119 2005
6. SUBSEQUENT EVENTS
On May 21, 1998, the Board of Trustees approved an agreement and plan of
reorganization and liquidation ("the Plan") with the Marquis Family of Funds
(the "Marquis Funds"). Under the Plan, the assets and liabilities of each
Marquis fund were transferred to a comparable One Group fund. Shares of the
comparable One Group fund were distributed to the Marquis shareholders in a
complete liquidation of each Marquis fund. A special Shareholder Meeting to
approve the plan was held on July 30, 1998. In a tax-free exchange on August
10, 1998, $69,923,110 of the Marquis Institutional Money Market Fund were
exchanged for 69,923,110 shares of the One Group Treasury Only Money Market
Fund.
12
56
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
TREASURY ONLY MONEY MARKET FUND
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD.................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------- -------- -------- -------- --------
Investment Activities:
Net investment income.................. 0.052 0.051 0.052 0.051 0.032
-------- -------- -------- -------- --------
Distributions:
Net investment income.................. (0.052) (0.051) (0.052) (0.051) (0.032)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD.......................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ======== ========
Total Return............................. 5.30% 5.24% 5.38% 5.22% 3.23%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)...... $719,570 $480,860 $415,961 $288,697 $217,725
Ratio of expenses to average net
assets.............................. 0.15% 0.15% 0.17% 0.20% 0.15%
Ratio of net investment income to
average net assets.................. 5.18% 5.12% 5.23% 5.14% 3.23%
Ratio of expenses to average net
assets*............................. 0.15% 0.15% 0.17% 0.21% 0.22%
Ratio of net investment income to
average net assets*................. 5.18% 5.12% 5.23% 5.13% 3.16%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
13
57
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GOVERNMENT MONEY MARKET FUND
------------------------------------------------------------
YEAR ENDED JUNE 30,
------------------------------------------------------------
1998 1997 1996 1995 1994
---------- ---------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
---------- ---------- -------- -------- --------
Investment Activities:
Net investment income................. 0.055 0.053 0.055 0.053 0.033
---------- ---------- -------- -------- --------
Distributions:
Net investment income................. (0.055) (0.053) (0.055) (0.053) (0.033)
---------- ---------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD......................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
========== ========== ======== ======== ========
Total Return............................ 5.64% 5.43% 5.61% 5.41% 3.40%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..... $3,712,252 $1,083,438 $855,613 $720,699 $692,253
Ratio of expenses to average net
assets............................. 0.15% 0.14% 0.18% 0.21% 0.11%
Ratio of net investment income to
average net assets................. 5.48% 5.31% 5.46% 5.28% 3.41%
Ratio of expenses to average net
assets*............................ 0.15% 0.14% 0.18% 0.22% 0.20%
Ratio of net investment income to
average net assets*................ 5.48% 5.31% 5.46% 5.27% 3.32%
- ------------
* During the period, certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
14
58
- --------------------------------------------------------------------------------
Report of Independent Accountants
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
To the Shareholders and Board of Trustees of
The One Group Family of Mutual Funds
In our opinion, the accompanying statements of assets and liabilities, including
the portfolios of investments, and related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Treasury Only Money Market Fund
and the Government Money Market Fund (two series of The One Group Family of
Mutual Funds), at June 30, 1998, the results of each of their operations for the
period then ended, the changes in each of their net assets for the periods
presented and the financial highlights for each of the periods presented, in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of The One Group Family of Mutual Funds'
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at June 30, 1998 by correspondence with the custodian
and brokers, provide a reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
August 18, 1998
15
59
Important Customer Information.
Please Read:
Shares of The One Group:
- - are not deposits or obligations
of, or guaranteed by BANC One
CORPORATION or its affiliates
- - are not insured or guaranteed by the
FDIC or by any other governmental
agency or government-sponsored
agency of the federal government
or any state
- - are subject to investment risks,
including possible loss of the
principal amount invested.
Banc One Investment Advisors
Corporation, a registered investment
advisor and an indirect subsidiary of
BANC ONE CORPORATION, serves
as an investment advisor to The One
Group, for which it receives advisory
fees. The One Group is distributed by
The One Group Services Company,
3435 Stelzer Road, Columbus,
Ohio 43219, which is not affiliated
with BANC ONE CORPORATION and
is not a bank. Contact us at our web
site address: www.onegroup.com or
e-mail us at onegroup@onegroup.com
For more complete information on
any of The One Group Funds, includ-
ing management fees and expenses,
you may obtain a prospectus from
The One Group Services Company.
Read the prospectus carefully
before investing.
BANC ONE
INVESTMENT
ADVISORS
CORPORATION
[BANC ONE LOGO]
60
Money
Market Funds
Annual Report
For the year ended June 30, 1998
U.S. Treasury Securities
Money Market Fund
Prime Money Market Fund
Municipal Money Market Fund
Ohio Municipal Money Market Fund
THE ONE GROUP
----------------------
FAMILY OF MUTUAL FUNDS
61
IMPORTANT CUSTOMER INFORMATION. INVESTMENT PRODUCTS:
- are not deposits or obligations of, or guaranteed by,
BANC ONE CORPORATION or any of its affiliates, [FDIC LOGO
WITH SLASH
- are not insured by the FDIC, and THOUGH IT]
- are subject to investment risks, including possible
loss of the principal amount invested.
62
- --------------------------------------------------------------------------------
Table of Contents
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Portfolio Performance Review................................................ 2
Schedules of Portfolio Investments.......................................... 6
Statements of Assets and Liabilities......................................... 17
Statements of Operations..................................................... 18
Statements of Changes in Net Assets.......................................... 19
Notes to Financial Statements................................................ 21
Financial Highlights......................................................... 28
Report of Independent Accountants............................................ 39
1
63
The One Group U.S. Treasury Securities Money Market Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The seven-day yield on The One Group U.S. Treasury Securities Money Market Fund
Fiduciary share class was 5.12% on June 30, 1998, up slightly from 5.03% on June
30, 1997.
WHAT CONTRIBUTED TO THE FUND'S FAIRLY STABLE YIELDS?
The Fund's yield reflects the relative stability in interest rates brought on by
the Federal Reserve's unchanged monetary policy. Rate movements throughout the
year were fairly moderate. They reflected changing views on economic strength
and whether that strength would lead to inflationary pressures requiring Federal
Reserve action.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our primary strategy during the period was to maintain a "barbell" maturity
structure, meaning that we focused on securities at the extremes of the
short-term maturity range. As such, the Fund emphasized securities with
maturities between six months and one year along with overnight repurchase
agreements.
The money market yield curve during the fiscal year remained fairly steep,
meaning that securities with longer maturities paid relatively higher yields.
The Fund's "longer" securities-those maturing in six months to one year-enabled
the Fund to increase its yield. At the same time, the repurchase agreements,
which matured overnight, allowed the Fund to retain a high level of liquidity.
This strategy led to an average maturity of 37 days on June 30, 1998, enabling
the Fund to maintain its "AAA" average quality rating-the best possible-from
Standard & Poor's and Moody's Investors Service. This rating indicates that the
Fund's securities are of the highest quality and offer the lowest risk. In order
to receive this rating, a fund must have an average maturity no greater than 60
days.
WHAT IS YOUR OUTLOOK FOR THE FUND?
Economic activity and its influences on Federal Reserve policies will have a
direct effect on the Fund over the next year. Over the near term, strong
domestic demand is likely to be offset by the Asian crisis. This will require
the Federal Reserve to be diligent in directing monetary policy. This outlook
warrants continued caution so the Fund can be positioned to benefit from any
action the Federal Reserve may take.
/s/ Andrew T. Linton
Andrew T. Linton
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed Income Securities
AVERAGE ANNUAL
TOTAL RETURN
CLASS OF SHARES 7 DAY YIELD 1 YEAR 5 YEARS 10 YEARS SINCE INCEPTION
Fiduciary 5.12% 5.19% 4.73% 5.39% 5.48%
Class A 4.87% 4.92% 4.47% NA 4.10%
Class B 4.12% 4.14% NA NA 4.11%
Class C 4.08% NA NA NA 1.47%
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
2
64
The One Group Prime Money Market Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The seven-day yield on The One Group Prime Money Market Fund Fiduciary share
class was 5.22% on June 30, 1998, down slightly from 5.25% on June 30, 1997.
WHAT CONTRIBUTED TO THE FUND'S FAIRLY STABLE YIELD?
The relative stability of the Fund's yield reflects the fact that the Federal
Reserve left monetary policy unchanged throughout the fiscal year. Interim rate
movements were fairly moderate and reflected market participants' changing views
on how the problems in Asia would affect the domestic economy. Some believed
that the seriousness of the situation would lead to a significant slowdown of
the U.S. economy, causing the Federal Reserve to cut interest rates. Others
believed that the underlying strength of the domestic economy would overwhelm
any Asian impact, and that the Federal Reserve would be forced to hike interest
rates in anticipation of higher inflation.
WHICH VIEWPOINT DID YOU FAVOR?
Our stance was that the Federal Reserve would leave interest rates unchanged. We
believed that cheaper imports resulting from the Asian crisis would help keep
the U.S. inflation rate low, as U.S. producers would be compelled to keep prices
down in order to compete. Also encouraging the Federal Reserve to leave rates
alone was the federal budget surplus. With Congress apparently gridlocked on how
to spend it, fiscal stimulus was not a problem facing monetary policy makers.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
With Federal Reserve monetary policy on hold, the Fund's weighted average
maturity stayed in a range of 60 days to 85 days-slightly higher than usual.
When interest rates climbed, we extended the weighted average maturity to the
higher end of the range to capture better yields. And, when rates drifted
downward, we shortened the weighted average maturity until we perceived better
value in the market.
On June 30, 1998, the Fund's weighted average maturity was 71 days, compared to
68 days on June 30, 1997.
WHAT IS YOUR OUTLOOK FOR THE FUND?
As long as the Federal Reserve maintains a gradual, modest approach to
regulating monetary supply, we will continue to pursue yield advantages from a
weighted average maturity range that is slightly longer than average.
/s/ Roger C. Hale
Roger C. Hale, CFA, CFP
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed Income Securities
AVERAGE ANNUAL
TOTAL RETURN
CLASS OF SHARES 7 DAY YIELD 1 YEAR 5 YEARS 10 YEARS SINCE INCEPTION
Fiduciary 5.22% 5.39% 4.92% 5.63% 5.76%
Class A 4.97% 5.13% 4.66% NA 4.29%
Class B 4.22% 4.35% NA NA 4.36%
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
3
65
The One Group Municipal Money Market Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The seven-day yield on The One Group Municipal Money Market Fund Fiduciary share
class was 3.15% on June 30, 1998, compared to 3.63% on June 30, 1997. (For
investors in the 39.6% federal income tax bracket, the June 30, 1998, tax-exempt
yield translates into a tax-equivalent yield of 5.16%.)
The Fund also experienced a significant increase in assets during the year to
$613.9 million from $524.5 million.
DID YIELDS FLUCTUATE MUCH DURING THE YEAR?
Yields in the variable-rate sector experienced the most volatility of any
sector, moving within a trading range of 2.75% to 4.50%. Rates reached their
peak in April and their low point in February. This volatility was due primarily
to changing technical supply and demand factors combined with inconsistent
market cash flows. In comparison, the one-year fixed-rate sector traded within a
narrower range of 3.55% to 3.85%.
HOW DID ECONOMIC EVENTS INFLUENCE MARKET PERFORMANCE?
Short-term tax-exempt rates moved moderately lower during the year. With the
Federal Reserve's monetary policy remaining unchanged, the market reacted
positively to moderate economic output and a low-inflation environment.
Many short-term municipal issuers have continued to benefit significantly from
the ongoing economic expansion. This favorable environment has allowed many
borrowers to either reduce their outstanding deficits or increase their cash
surplus, which resulted in reduced issuance compared to previous years. Lower
financing needs coupled with steady demand supported the downward trend in
rates.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our primary strategy continues to involve adjusting the mix of variable-rate and
fixed-rate obligations based on changing market conditions. We also incorporate
a quality-oriented investment selection process to help ensure that all issues
selected for the Fund represent minimal credit risk. Because of this process,
the Fund did not experience any adverse impact or credit downgrades from the
Asian bank and credit crisis that began to unfold in October.
As the yield curve shifted during the year, we maintained the Fund's average
maturity in a range of 34 days to 61 days. This enabled us to take advantage of
changing market conditions and to accommodate the Fund's liquidity needs. At
year-end, the average maturity was 46 days, compared to 37 days a year ago.
WHAT IS YOUR OUTLOOK FOR THE FUND?
The outlook for the municipal money market continues to look positive. While
demand for short-term products should continue to exceed available market
supply, we plan to focus on longer-term issues and rely on our investment
process in an attempt to provide competitive returns.
/s/ Thomas W. Cary
Thomas W. Cary
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed Income Securities
AVERAGE ANNUAL
TOTAL RETURN
CLASS OF SHARES 7 DAY YIELD 1 YEAR 5 YEARS 10 YEARS SINCE INCEPTION
Fiduciary 3.15% 3.27% 3.05% 3.77% 3.84%
Class A 2.90% 3.01% 2.81% NA 2.64%
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
4
66
The One Group Ohio Municipal Money Market Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The seven-day yield on The One Group Ohio Municipal Money Market Fund Fiduciary
share class was 3.21% on June 30, 1998, compared to 3.73% on June 30, 1997. (For
investors in the 39.6% federal income tax bracket and the 7.0% Ohio state tax
bracket, the June 30, 1998 tax-exempt yield translates into a tax-equivalent
yield of 6.01%.)
The Fund also experienced a large increase in total assets during the year,
increasing to $118.3 million from $87.2 million.
HOW DID ECONOMIC EVENTS INFLUENCE PERFORMANCE?
The Federal Reserve kept monetary policy unchanged, heavily influenced by
moderate economic activity within a favorable inflationary environment. This
combination allowed for rates to trend moderately lower.
While short-term tax-exempt rates generally declined during the year, they did
so in an uneven fashion. Yields in the variable-rate demand sector experienced
the most volatility, moving within a trading range of 2.60% to 4.40%. This
volatility was due to the impact of quickly changing market conditions on
varying levels of supply and demand. In comparison, the one-year fixed-rate
sector traded within a narrower range of 3.45% to 3.75%.
DID THE OHIO POLITICAL PROCESS HAVE A ROLE IN THE SUPPLY/DEMAND SCENARIO?
The Ohio political scene played a role in affecting the supply of one-year
school district note issues. Many school district issuers put their financing
needs on hold, pending the May 1998 ballot decision on two proposals to let the
state reallocate revenues to school districts on a more equitable basis. When
the proposals were defeated, these issuers had to delay their voter-approved
issues until the November ballot, which ultimately reduced the supply of new
school notes during the spring. The relative lack of supply helped support
attractive prices during this period.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our primary strategy was to adjust the mix of variable-rate and fixed-rate
obligations in anticipation of and in response to changing market conditions.
While rates were slightly lower overall, there were noticeable upward rate
spikes during the year, underscoring the importance of the variable-rate sector.
Within this context, we maintained a high-quality portfolio, relying extensively
on our investment selection process to avoid any credit concerns resulting from
the Asian crisis.
With the yield curve shifting during the year, we maintained the Fund's average
maturity in a range of 34 days to 64 days. The changes in average maturity were
necessary to take advantage of shifting market conditions and to accommodate the
Fund's liquidity needs. At year-end, the average maturity was 36 days, compared
to 50 days a year ago.
WHAT IS YOUR OUTLOOK FOR THE FUND?
The near-term outlook for the Ohio municipal market remains favorable. With a
forecast of slowing economic activity and relatively stable rates, we believe
the Fund should continue to focus on slightly longer-term issues, supported by
our investment selection process, to attempt to provide attractive returns.
/s/ Thomas W. Cary
Thomas W. Cary
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed Income Securities
AVERAGE ANNUAL
TOTAL RETURN
CLASS OF SHARES 7 DAY YIELD 1 YEAR 5 YEARS SINCE INCEPTION
Fiduciary 3.21% 3.31% 3.06% 3.05%
Class A 2.96% 3.06% 2.83% 2.77%
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
5
67
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
U.S. Treasury Securities Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
U.S. TREASURY OBLIGATIONS (19.5%):
U.S. Treasury Bills (2.5%):
$ 100,000 11/12/98........................... $ 98,042
----------
U.S. Treasury Notes (17.0%):
120,000 5.25%, 7/31/98 (b)................. 119,966
95,000 6.13%, 8/31/98 (b)................. 95,058
50,000 5.88%, 10/31/98.................... 50,046
50,000 8.88%, 2/15/99 (b)................. 51,003
50,000 5.88%, 2/28/99..................... 50,102
50,000 6.25%, 3/31/99 (b)................. 50,264
140,000 7.00%, 4/15/99..................... 141,518
100,000 6.38%, 5/15/99..................... 100,588
----------
658,545
----------
Total U.S. Treasury Obligations 756,587
----------
REPURCHASE AGREEMENTS (80.7%):
150,000 Barclays De Zoette Wedd, 5.80%
7/1/98 (Collateralized by
$182,288 various U.S. Treasury
Securities, 0.00% - 12.50%,
10/29/98 - 4/15/28, market value
$153,000)........................ 150,000
150,000 Deutche Morgan Grenfell, 6.00%,
7/1/98 (Collateralized by
$145,118 various U.S. Treasury
Securities, 5.00% - 14.00%,
2/15/99 - 11/15/11, market value
$153,001)........................ 150,000
30,000 Deutche Morgan Grenfell, 5.50%,
7/1/98 (Collateralized by $29,024
various U.S. Treasury Securities,
5.00% - 14.00%,
2/15/99 - 11/15/11, market value
$30,600)......................... 30,000
901,953 Goldman Sachs, 5.80%, 7/1/98
(Collateralized by $1,051,085
various U.S. Treasury Securities,
0.00% - 7.13%,
12/3/98 - 11/15/27, market value
$919,992)........................ 901,953
50,000 Goldman Sachs, 5.50%, 7/1/98
(Collateralized by $58,267
various U.S. Treasury Securities,
0.00% - 7.13%,
12/3/98 - 11/15/27, market value
$51,000)......................... 50,000
150,000 Greenwich Capital Inc., 5.75%,
7/1/98 (Collateralized by
$148,673 various U.S. Treasury
Securities, 3.38% - 6.50%,
7/15/02 - 4/15/28, market value
$153,002)........................ 150,000
150,000 HSBC Securities, 5.80%, 7/1/98
(Collateralized by $108,107
various U.S. Treasury Securities,
9.00% - 9.25%,
2/15/16 - 11/15/18, market value
$153,001)........................ 150,000
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
REPURCHASE AGREEMENTS, CONTINUED:
$ 150,000 J.P. Morgan Securities, 5.80%,
7/1/98 (Collateralized by
$140,384 various U.S. Treasury
Securities, 5.50% - 8.13%,
7/31/99 - 8/15/19, market value
$153,001)........................ $ 150,000
25,000 J.P. Morgan Securities, 5.40%,
7/1/98 (Collateralized by $24,750
U.S. Treasury Notes, 6.25%,
10/31/01, market value
$25,501)......................... 25,000
900,000 Morgan Stanley, 5.73%, 7/1/98
(Collateralized by $856,187
various U.S. Treasury Securities,
0.00% - 10.38%,
8/15/98 - 8/15/23, market value
$918,036)........................ 900,000
150,000 Prudential Securities, 5.65%,
7/1/98 (Collateralized by
$141,514 various U.S. Treasury
Securities, 0.00% - 13.38%,
7/31/98 - 2/15/25, market value
$153,001)........................ 150,000
150,000 Societe Generale, 6.00%, 7/1/98
(Collateralized by $149,146
various U.S. Treasury Securities,
5.88% - 11.75%,
4/30/99 - 2/15/15, market value
$153,021)........................ 150,000
150,000 Westdeutsche Landesbank, 5.70%,
7/1/98 (Collateralized by
$108,800 various U.S. Treasury
Securities, 5.38% - 14.00%,
2/15/01 - 11/15/11, market value
$153,001)........................ 150,000
30,000 Westdeutsche Landesbank, 5.50%,
7/1/98 (Collateralized by $21,760
various U.S. Treasury Securities,
5.38% - 14.00%,
2/15/01 - 11/15/11, market value
$30,616)......................... 30,000
----------
Total Repurchase Agreements 3,136,953
----------
SHORT-TERM SECURITIES HELD AS COLLATERAL (6.6%):
Repurchase Agreements
203,538 Goldman Sachs, 5.80%, 7/1/98
(Collateralized by $205,585 U.S.
Treasury Notes, 5.63%, 5/15/01,
market value $207,609)........... 203,538
52,125 Goldman Sachs, 5.20%, 7/1/98
(Collateralized by $48,403 U.S.
Treasury Notes, 5.63%, 5/15/01,
market value $53,168)............ 52,125
----------
Total Short-Term Securities Held as
Collateral 255,663
----------
Total (Amortized Cost $4,149,203) (a) $4,149,203
==========
- ------------
Percentages indicated are based on net assets of $3,887,140.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
(b) A portion of this security was loaned as of June 30, 1998.
See notes to financial statements.
6
68
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Prime Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
CERTIFICATES OF DEPOSIT (3.7%):
Banking (3.7%):
$ 25,000 Bankers Trust New York Corp.,
6.00%, 7/7/98.................... $ 25,000
25,000 Bankers Trust New York Corp.,
5.88%, 7/14/98................... 25,000
20,000 Bankers Trust New York Corp.,
5.92%, 7/17/98................... 20,000
25,000 Bankers Trust New York Corp.,
5.91%, 8/7/98.................... 24,999
25,000 Bankers Trust New York Corp.,
5.77%, 5/21/99................... 24,989
----------
Total Certificates of Deposit 119,988
----------
COMMERCIAL PAPER (56.2%):
Automotive (5.1%):
30,000 American Honda Finance Corp.,
5.49%, 7/22/98................... 29,903
23,400 Harley-Davidson Funding, 5.53%,
7/9/98........................... 23,371
10,000 Harley-Davidson Funding, 5.55%,
7/10/98.......................... 9,986
12,320 Harley-Davidson Funding, 5.54%,
7/13/98.......................... 12,297
10,445 Harley-Davidson Funding, 5.54%,
7/16/98.......................... 10,421
15,450 Harley-Davidson Funding, 5.56%,
7/23/98.......................... 15,398
17,600 Harley-Davidson Funding, 5.55%,
7/24/98.......................... 17,538
8,300 Harley-Davidson Funding, 5.56%,
8/13/98.......................... 8,245
14,300 Harley-Davidson Funding, 5.58%,
8/18/98.......................... 14,194
22,500 Harley-Davidson Funding, 5.55%,
9/16/98.......................... 22,233
----------
163,586
----------
Banking (9.0%):
50,000 AB Spintab, 5.55%, 8/20/98......... 49,615
25,000 AB Spintab, 5.53%, 12/2/98......... 24,409
50,000 AB Spintab, 5.52%, 12/10/98........ 48,758
25,000 AB Spintab, 5.55%, 12/28/98........ 24,306
50,000 Banco Rio de la Plata S.A., 5.47%,
12/7/98.......................... 48,794
48,500 Banco Rio de la Plata S.A., 5.46%,
12/8/98.......................... 47,323
50,000 Norwest Corporation, 6.25%,
7/1/98........................... 49,999
----------
293,204
----------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
COMMERCIAL PAPER, CONTINUED:
Brokerage Services (4.6%):
$ 50,000 Lehman Brothers Holdings, Inc.,
5.52%, 7/15/98................... $ 49,892
50,000 Lehman Brothers Holdings, Inc.,
5.45%, 8/19/98................... 49,629
50,000 Salomon Smith Barney Holdings,
5.52%, 8/11/98................... 49,686
----------
149,207
----------
Construction (1.1%):
34,000 Cemex, S.A. de CV, 5.42%,
7/30/98.......................... 33,852
----------
Financial Services (8.8%):
17,550 Ace Overseas Corp., 5.60%,
7/10/98.......................... 17,525
32,000 Ace Overseas Corp., 5.62%,
7/17/98.......................... 31,920
47,550 Corporate Receivables Corp., 5.55%,
7/17/98.......................... 47,433
11,500 Old Line Funding Corp., 5.60%,
7/14/98.......................... 11,477
39,450 Old Line Funding Corp., 5.60%,
7/15/98.......................... 39,364
10,053 Old Line Funding Corp., 5.60%,
7/16/98.......................... 10,030
38,766 Variable Funding Capital Corp.,
5.57%, 8/18/98................... 38,478
15,000 WCP Funding, Inc., 5.53%,
7/07/98.......................... 14,986
25,000 WCP Funding, Inc., 5.50%,
7/14/98.......................... 24,950
25,000 WCP Funding, Inc., 5.53%,
7/23/98.......................... 24,916
25,000 WCP Funding, Inc., 5.53%,
7/29/98.......................... 24,892
----------
285,971
----------
Gas & Electric Utility (2.7%):
53,897 Cogentrix of Richmond, 5.65%,
7/23/98.......................... 53,711
13,000 Duke Capital Corp., 5.54%,
7/02/98.......................... 12,998
21,000 Duke Capital Corp., 5.54%,
7/16/98.......................... 20,952
----------
87,661
----------
Industrial Goods & Services (0.5%):
15,000 Akzo Nobel, Inc., 5.49%, 7/6/98.... 14,989
----------
Insurance (4.6%):
68,100 Safeco Credit Co., 5.56%, 7/8/98... 68,026
20,000 Safeco Credit Co., 5.54%,
7/13/98.......................... 19,963
20,000 Safeco Credit Co., 5.55%,
7/23/98.......................... 19,932
25,000 Safeco Credit Co., 5.55%, 8/3/98... 24,873
15,350 Safeco Credit Co., 5.58%,
9/21/98.......................... 15,155
----------
147,949
----------
Office Equipment & Services (3.8%):
37,000 Xerox Mexico SA de CV, 5.55%,
7/6/98........................... 36,971
49,500 Xerox Mexico SA de CV, 5.63%,
7/29/98.......................... 49,283
36,500 Xerox Mexico SA de CV, 5.56%,
8/5/98........................... 36,303
----------
122,557
----------
Continued
7
69
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Prime Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
COMMERCIAL PAPER, CONTINUED:
Oil & Gas Exploration (3.9%):
$ 50,000 Pemex Capital, Inc., 5.54%,
8/20/98.......................... $ 49,615
16,000 Petroleo Brasileiro SA, 5.52%,
8/26/98.......................... 15,863
30,000 Petroleo Brasileiro SA, 5.43%,
9/29/98.......................... 29,593
30,000 Petroleo Brasileiro SA, 5.40%,
11/30/98......................... 29,316
----------
124,387
----------
Real Estate (8.5%):
46,385 75 State Street Capital Corp.,
5.56%, 7/9/98.................... 46,328
55,801 75 State Street Capital Corp.,
5.57%, 7/10/98................... 55,724
24,654 75 State Street Capital Corp.,
5.56%, 7/14/98................... 24,605
31,302 75 State Street Capital Corp.,
5.58%, 7/16/98................... 31,229
18,500 Countrywide Home Loans, 5.55%,
7/16/98.......................... 18,457
25,000 Countrywide Home Loans, 5.54%,
8/12/98.......................... 24,838
40,000 Countrywide Home Loans, 5.54%,
8/26/98.......................... 39,655
35,000 Countrywide Home Loans, 5.53%,
9/2/98........................... 34,661
----------
275,497
----------
Retail (3.6%):
25,000 Sotheby's, Inc., 5.55%, 7/1/98..... 25,000
25,000 Sotheby's, Inc., 5.56%, 7/13/98.... 24,954
25,000 Sotheby's, Inc., 5.56%, 7/20/98.... 24,927
10,000 Sotheby's, Inc., 5.56%, 8/3/98..... 9,949
15,000 Sotheby's, Inc., 5.55%, 8/14/98.... 14,898
15,000 Sotheby's, Inc., 5.58%, 8/21/98.... 14,881
----------
114,609
----------
Total Commercial Paper 1,813,469
----------
CORPORATE NOTES & BONDS (4.7%):
Banking (1.6%):
25,000 Abbey National, 5.88%, 12/22/98.... 24,994
26,000 Abbey National, 5.72%, 6/11/99..... 25,981
----------
50,975
----------
Brokerage Services (1.6%):
50,000 Bear Stearns Co., Inc., 5.63%,
5/14/99*......................... 50,000
----------
Computer Hardware (1.5%):
50,000 IBM Credit Corp., 5.45%, 2/18/99... 49,962
----------
Total Corporate Notes & Bonds 150,937
----------
FUNDING AGREEMENTS (11.8%):
50,000 Allstate Life Insurance Co., 5.82%,
8/31/98*......................... 50,000
160,000 General American Life Insurance
Co., 5.85%, 12/21/98*............ 160,000
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
FUNDING AGREEMENTS, CONTINUED:
$ 60,000 Peoples Security Life Insurance
Co., 5.82%, 10/1/98*............. $ 60,000
60,000 Providian Life & Health Insurance
Co., 5.82%, 11/1/98*............. 60,000
50,000 Providian Life & Health Insurance
Co., 5.76%, 2/12/99*............. 50,000
----------
Total Funding Agreements 380,000
----------
U.S. GOVERNMENT AGENCY SECURITIES (1.6%):
Student Loan Marketing Assoc. (1.6%):
50,000 5.32%, 9/28/98*.................... 50,000
----------
Total U.S. Government Agency Securities 50,000
----------
YANKEE & EURODOLLAR (18.4%):
Banking (18.4%):
15,000 Bank of Montreal, 5.81%, 11/9/98... 15,007
50,000 Bank of Nova Scotia, 5.89%,
12/15/98......................... 50,002
25,000 Bayerische Landesbank, 5.81%,
12/17/98......................... 24,992
30,000 Bayerische Vereinsbank AG, 5.70%,
10/6/98.......................... 29,995
25,000 Canadian Imperial Bank of Commerce,
5.94%, 10/21/98.................. 24,996
25,000 Canadian Imperial Bank of Commerce,
5.64%, 3/2/99.................... 24,990
25,000 Canadian Imperial Bank of Commerce,
5.69%, 3/10/99................... 24,995
15,000 Den Danske Bank, 5.72%, 11/30/98... 15,001
30,000 Deutsche Bank A.G., 5.66%,
3/26/99.......................... 29,988
25,000 Deutsche Bank A.G., 5.70%,
6/7/99........................... 24,987
25,000 National Australia Bank, 5.74%,
10/13/98......................... 24,997
27,000 National Westminster Bank, 5.71%,
4/16/99.......................... 26,991
26,000 Societe Generale, 5.86%, 7/21/98... 25,998
25,000 Societe Generale, 5.97%, 9/15/98... 24,998
25,000 Societe Generale, 5.86%,
11/18/98......................... 25,008
25,000 Societe Generale, 5.88%,
12/16/98......................... 24,997
25,000 Societe Generale, 5.73%, 3/29/99... 24,991
25,000 Swiss Bank Corp., 5.90%, 8/28/98... 24,998
75,000 Swiss Bank Corp., 5.83%,
12/16/98......................... 75,018
25,000 Swiss Bank Corp., 5.64%, 2/26/99... 24,992
25,000 Swiss Bank Corp., 5.81%, 4/29/99... 24,988
----------
Total Yankee & Eurodollar 592,929
----------
Continued
8
70
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Prime Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ----------
REPURCHASE AGREEMENTS (3.2%):
$102,434 Prudential Securities, 6.10%,
7/1/98 (Collateralized by
$101,841 various U.S. Government
Securities, 0.00% - 7.25%,
7/1/98 - 8/15/04, market value
$104,484)........................ $ 102,434
----------
Total Repurchase Agreements 102,434
----------
Total (Amortized Cost $3,209,757)(a) $3,209,757
==========
- ------------
Percentages indicated are based on net assets of $3,223,901.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
* Variable rate securities. The interest rate, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
9
71
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
DAILY DEMAND NOTES (9.4%):
Alabama (0.8%):
$ 1,300 Phenix City, IDR for Mead, AMT,
4.05%, 3/1/31, LOC:.............. $ 1,300
Bayerische Landesbank*
3,600 Phenix City, IDR for Mead, Series
93-A, AMT, 4.05%, 6/1/28, LOC:
Toronto Domimion Bank*........... 3,600
--------
4,900
--------
Idaho (1.3%):
7,915 Health Facility Authority Revenue,
St. Lukes Regional Medical Center
Project, 3.75%, 5/1/22, LOC:
Bayerische Landesbank*........... 7,915
--------
Kentucky (1.7%):
5,200 Lexington Fayette Urban County
Airport Revenue, AMT, 4.10%,
4/01/24, LOC: Credit Local De
France*.......................... 5,200
4,900 Lexington Fayette Urban County
Airport Revenue, 4.10%, 7/1/28,
MBIA*............................ 4,900
--------
10,100
--------
Michigan (0.4%):
2,500 State Strategic Fund, Detroit
Edison Project, 3.80%, 9/1/30,
LOC: Barclay's Bank Plc*......... 2,500
--------
New York (0.1%):
500 New York, GO, Series B, 4.10%,
10/1/21, FGIC*................... 500
--------
North Carolina (3.6%):
21,100 Person County Industrial and
Pollution Control Revenue, AMT,
3.95%, 11/1/16, LOC: SunTrust
Bank*............................ 21,100
--------
Ohio (0.0%):
200 State Air Quality Development
Authority, Cincinnati Gas &
Electric, 3.80%, 12/1/15, LOC:
J.P. Morgan*..................... 200
--------
Texas (1.3%):
3,300 Brazos River Authority, PCR, Texas
Utilities Electric Co. Project,
AMT, 3.90%, 6/1/30, AMBAC*....... 3,300
4,475 Sabine River Authority, PCR, Texas
Utilities Electric Co. Project,
Series C, 3.90%, 6/1/30, LOC:
Union Bank of Switzerland*....... 4,475
--------
7,775
--------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
DAILY DEMAND NOTES, CONTINUED:
Washington (0.1%):
$ 800 Health Care Facilities, Fred
Hutchinson, Series A, 3.75%,
1/1/18, LOC: Morgan Guaranty*.... $ 800
--------
Wyoming (0.1%):
800 Sublette County, PCR, Series B,
3.80%, 7/1/17, GTY: Exxon*....... 800
--------
Total Daily Demand Notes 56,590
--------
MONTHLY DEMAND NOTES (2.5%):
Indiana (2.5%):
14,800 Gary Environmental Improvement
Revenue, U.S. Steel Corp.
Project, 3.70%, 7/15/02, LOC:
Bank of Nova Scotia*............. 14,800
--------
Total Monthly Demand Notes 14,800
--------
MUNICIPAL NOTES (10.4%):
California (1.7%):
10,000 Los Angeles County Tax & Revenue
Anticipation Notes Series A,
4.50%, 6/30/99................... 10,080
--------
Colorado (0.8%):
5,000 State Of Colorado Transportation,
4.00, 6/25/99.................... 5,020
--------
Kentucky (1.2%):
7,000 Asset Liability Commission General
Fund, Trans 98-A, 4.50%,
6/25/99.......................... 7,061
--------
Ohio (1.0%):
5,900 Dublin Transportation System, GO,
3.62%, 12/17/98.................. 5,902
--------
Oregon (1.0%):
6,000 State Housing And Community
Services, 3.75%, 5/13/99......... 6,000
--------
Pennsylvania (0.8%):
5,000 Pennsylvania State University,
Series A, 4.50%, 3/30/99......... 5,034
--------
Tennessee (0.8%):
5,000 State Local Development Authority,
4.00%, 5/19/99................... 5,013
--------
Texas (0.6%):
3,500 State Tax & Revenue Anticipation
Notes, Series 97A, 4.75%,
8/31/98.......................... 3,505
--------
Wisconsin (2.5%):
15,000 State Operating Notes, 4.50%,
6/15/99.......................... 15,132
--------
Total Municipal Notes 62,747
--------
Continued
10
72
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
PUT BONDS (2.9%):
Arizona (1.5%):
$ 9,000 Cochise County, PCR, Arizona
Electric Power Corp., Series A,
AMT, 3.55%, 9/1/24............... $ 9,000
--------
Florida (1.0%):
6,000 Putnam County Development
Authority, Seminole Electric Co.,
3.65%, 12/15/09.................. 6,000
--------
North Dakota (0.4%):
2,600 Mercer County, Solid Waste Disposal
Revenue, National Rural Utility
Power Project, Series U, 3.80%,
12/1/18.......................... 2,600
--------
Total Put Bonds 17,600
--------
TAX FREE COMMERCIAL PAPER (18.2%):
Alabama (2.4%):
1,500 Phenix IDR, Mead Paper, AMT, 3.77%,
7/7/98, LOC: ABN AMRO*........... 1,500
2,000 Phenix IDR, Mead Paper, AMT, 3.70%.
7/15/98, LOC: ABN AMRO*.......... 2,000
5,600 Phenix IDR, Mead Paper, AMT, 3.45%,
7/31/98, LOC: ABN AMRO*.......... 5,600
3,000 Phenix IDR, Mead Paper, AMT, 3.65%,
8/18/98, LOC: ABN AMRO*.......... 3,000
2,400 Phenix IDR, Mead Paper, AMT, 3.80%,
8/24/98, LOC: ABN AMRO*.......... 2,400
--------
14,500
--------
Arizona (1.5%):
4,000 Mesa Municipal Development Corp.,
3.45%, 7/8/98, LOC: Westdeutsche
Landesbank*...................... 4,000
4,770 Mesa Municipal Development Corp.,
3.55%, 7/14/98, LOC: Westdeutsche
Landesbank*...................... 4,770
--------
8,770
--------
Colorado (1.3%):
1,400 Platte River Electric Revenue,
3.45%, 7/6/98, LOC: J.P.
Morgan*.......................... 1,400
2,000 Platte River Electric Revenue,
3.40%, 7/6/98, LOC: J.P.
Morgan*.......................... 2,000
4,400 Platte River Electric Revenue,
3.60%, 8/13/98, LOC: J.P.
Morgan*.......................... 4,400
--------
7,800
--------
Minnesota (0.4%):
1,000 Rochester Healthcare Facility
Revenue, 3.65%, 7/13/98.......... 1,000
1,700 Rochester Healthcare Facility
Revenue, 3.45%, 7/13/98.......... 1,700
--------
2,700
--------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
TAX FREE COMMERCIAL PAPER, CONTINUED:
Missouri (0.4%):
$ 2,500 State Environmental Authority,
Union Electric Co., 3.63%,
7/10/98, LOC: Union Bank of
Switzerland...................... $ 2,500
--------
North Carolina (1.4%):
8,300 Eastern Municipal Power, 3.40%,
7/21/98, LOC: Canadian Imperial
Bank of Commerce................. 8,300
--------
Pennsylvania (0.8%):
1,500 Delaware County, Philadelphia
Electric Co., 3.45%, 9/3/98,
FGIC............................. 1,500
3,300 Delaware County, Philadelphia
Electric Co., 3.40%, 9/3/98,
FGIC............................. 3,300
--------
4,800
--------
Texas (7.3%):
20,000 Brazos River Authority, Texas
Utilities Co., 3.50%, 8/7/98,
LOC: Canadian Imperial Bank of
Commerce:........................ 20,000
5,000 Brazos River Utilities, Texas
Utilities Co., 3.55%, 9/8/98,
LOC: Canadian Imperial Bank of
Commerce......................... 5,000
10,000 Public Finance Authority, 3.40%,
9/9/98, LOC: Union Bank of
Switzerland...................... 10,000
5,000 Public Finance Authority, GO,
Series 93A, 3.65%, 9/9/98, LOC:
Union Bank of Switzerland........ 5,000
3,400 Texas A&M, 3.40%, 7/9/98, LOC:
Union Bank of Switzerland........ 3,400
--------
43,400
--------
West Virginia (0.7%):
4,500 State Public Authority Energy
Revenue, Morgantown Assoc.
Project, AMT, 3.65%, 7/17/98,
LOC: Swiss Bank*................. 4,500
--------
Wisconsin (0.8%):
5,015 GO Series 97, 3.60%, 8/18/98....... 5,015
--------
Wyoming (1.2%):
2,000 Gillette Pollution Control Revenue,
AMT, 3.65%, 8/6/98, LOC: ABN
AMBRO*........................... 2,000
5,400 Sweetwater County, PCR, Series
88-A, 3.65%, 7/1/98, LOC: Union
Bank of Switzerland*............. 5,400
--------
7,400
--------
Total Tax Free Commercial Paper 109,685
--------
Continued
11
73
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
WEEKLY DEMAND NOTES (58.4%):
Arkansas (1.8%):
$ 8,100 Clark County, Solid Waste Disposal
Revenue, Reynolds Metals Co.
Project, AMT, 3.65%, 8/1/22, LOC:
SunTrust Bank*................... $ 8,100
2,900 Clark County, Solid Waste Disposal
Revenue, AMT, 3.65%, 8/1/22, LOC:
SunTrust Bank*................... 2,900
--------
11,000
--------
Colorado (3.7%):
2,900 Housing Finance Authority, Pool I,
Series B, Coventry Village,
3.55%, 10/15/16, FNMA*........... 2,900
5,600 Student Obligation Bond Authority,
AMT, 3.50%, 7/1/20, SLMA*........ 5,600
13,900 Student Obligation Bond Authority,
Series 90-A, AMT, 3.50%, 9/1/24,
SLMA*............................ 13,900
--------
22,400
--------
District of Columbia (1.6%):
9,705 Metro Washington D.C. Airports
Authority Trust Receipts, 3.75%,
10/1/16, LIQ: Societe General*... 9,705
--------
Georgia (2.8%):
13,000 De Kalb Private Hospital Authority
Revenue, Egleston Children's
Hospital, Series A, 3.45%,
3/1/24, LOC: SunTrust Bank*...... 13,000
3,735 Gwinnett County Housing Authority,
Herrington Woods Apts., Series
96A, AMT, 3.65%, 9/15/26, LOC:
KeyBank*......................... 3,735
--------
16,735
--------
Illinois (9.2%):
11,100 Chicago O'Hare International
Airport Revenue, Second Lien,
Series B, AMT, 3.65%, 1/1/18,
LOC: Societe Generale*........... 11,100
10,000 Chicago School Board Of Education,
Series 3, 3.70%, 12/1/27,
AMBAC*........................... 10,000
5,200 Development Finance Authority
Revenue, Aurora Central Catholic
High School, 3.55%, 4/1/24, LOC:
Northern Trust................... 5,200
3,700 Development Finance Authority
Revenue, Presbyterian Home Lake
Forrest Place Project, 3.55%,
9/1/31, LOC: LaSalle National
Bank*............................ 3,700
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
WEEKLY DEMAND NOTES, CONTINUED:
Illinois, continued:
$ 4,500 Development Finance Authority
Revenue, Roosevelt University
Project, 3.55%, 4/1/25, LOC:
American National Bank*.......... $ 4,500
5,800 Development Finance Authority
Revenue, Special Facility, Little
City Foundation, 3.55%, 2/1/19,
LOC: LaSalle National Bank*...... 5,800
1,620 Development Finance Authority
Revenue, St. Paul's House
Project, 3.55%, 2/1/25, LOC:
LaSalle National Bank*........... 1,620
3,000 Health Facility Authority Revenue,
Washington & Jane Smith Home,
3.55%, 7/1/26, LOC: Comerica
Bank*............................ 3,000
7,640 Jacksonville Industrial Project
Revenue, AGI, Inc. Project, AMT,
3.80%, 2/1/26, LOC: Bank of
America*......................... 7,640
1,100 Lombard IDR, Chicago Roll Co.
Project, 3.90%, 2/1/10, LOC:
American National Bank*.......... 1,100
2,000 Orland Hills, Multi Family Mortgage
Revenue, 88th Avenue Project,
3.55%, 12/1/04, LOC: LaSalle
National Bank*................... 2,000
--------
55,660
--------
Indiana (8.7%):
14,600 Health Facility Financing
Authority, Rehabilitation
Hospital, Inc., 3.50%, 11/1/20,
LOC: National Bank of Detroit*... 14,600
5,600 Indianapolis Economic Development
Revenue, Children's Museum
Project, 3.55%, 10/1/25, LOC:
National Bank of Detroit*........ 5,600
3,300 Jasper Economic Development
Revenue, Best Chairs, Inc.
Project, AMT, 3.75%, 3/1/19, LOC:
PNC Bank*........................ 3,300
16,200 Rockport, PCR, Indiana & Michigan
Electric Co., Series A, 3.65%,
8/1/14, LOC: Swiss Bank*......... 16,200
13,000 State Educational Authority
Revenue, Wesleyan University,
3.50%, 6/1/28, LOC: National Bank
of Detroit*...................... 13,000
--------
52,700
--------
Continued
12
74
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
WEEKLY DEMAND NOTES, CONTINUED
Kentucky (0.6%):
$ 3,500 Mayfield, League of Cities Lease
Finance Program 96, 3.70%,
7/1/26, LOC: PNC Bank*........... $ 3,500
--------
Michigan (7.8%):
20,500 Higher Education Student Loan,
Series B, AMT, 3.55%, 10/1/13,
AMBAC*........................... 20,500
10,000 Kent Hospital Authority Revenue,
Spectrum Health, Series B, 3.45%,
1/15/26, MBIA*................... 10,000
1,000 State Job Authority Revenue, 3.50%,
8/1/15, LOC: Rabo Bank*.......... 1,000
1,560 State Strategic Fund, Limited
Obligation, Wayne Disposal
Oakland Project, AMT, 3.70%,
3/1/05, LOC: Credit Suisse-First
Boston*.......................... 1,560
13,940 Wayne County Airport Revenue
(Detroit Airport), Series B, AMT,
3.50%, 12/1/16, LOC: Bayerische
Landesbank*...................... 13,940
--------
47,000
--------
New York (1.7%):
10,000 Long Island Power Authority,
Electric System Revenue, Series
1, 3.50%, 5/1/33, LOC:
Westdeutsche and Bayerische
Landesbank*...................... 10,000
--------
North Carolina (0.8%):
5,000 Mecklenburg County, Series C,
3.50%, 2/1/17, LOC: First Union
National Bank*................... 5,000
--------
Ohio (6.8%):
8,600 Butler County Multi-Family Revenue,
3.50%, 11/15/30, FNMA*........... 8,600
8,800 State Air Quality Development
Authority Revenue, JMG Funding
Ltd. Partnership, Series A, AMT,
3.60%, 4/1/28, LOC: Societe
Generale*........................ 8,800
3,700 State Air Quality Development
Authority, JMG Funding Ltd.
Partnership, AMT, 3.60%, 4/1/29,
LOC: Societe Generale*........... 3,700
20,000 Student Loan Funding Corp.,
Cincinnati, Series 98-A2, AMT,
3.60%, 8/1/10, LOC: Bank of
America*......................... 20,000
--------
41,100
--------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
WEEKLY DEMAND NOTES, CONTINUED:
Pennsylvania (2.3%):
$ 2,500 Philadelphia Redevelopment
Authority Revenue, 3.65%,
12/1/03, LOC: PNC Bank*.......... $ 2,500
6,300 State Economic Development Finance
Authority Revenue, Series 98D,
3.75%, 6/1/10 LOC: PNC Bank*..... 6,300
4,800 State Higher Education Authority
Revenue, 3.50%, 3/1/26 LOC: First
Union National Bank*............. 4,800
--------
13,600
--------
South Carolina (0.3%):
1,700 Cherokee County, Industrial
Revenue, Oshkosh Truck Corp.
Project, AMT, 3.80%, 8/1/19, LOC:
Bank of Nova Scotia*............. 1,700
--------
Tennessee (2.4%):
10,500 Montgomery County Public Building,
3.60%, 7/1/19, LOC:
NationsBank*..................... 10,500
3,800 Oak Ridge Industrial Development
Board, Economic Development
Revenue, Limited Obligation,
3.60%, 5/1/09, LOC: ABN AMRO*.... 3,800
--------
14,300
--------
Texas (6.8%):
14,100 Capital Health Facilities
Development Corp., Island on Lake
Travis Ltd. Project, AMT, 3.55%,
12/1/16, LOC: Credit Suisse-First
Boston*.......................... 14,100
17,800 Panhandle Plains Higher Education
Inc., Student Loan Revenue,
Series A, AMT, 3.50% 6/1/21,
SLMA*............................ 17,800
9,400 Panhandle Plains Higher Education
Inc., Student Loan Revenue,
Series A, AMT, 3.50%, 6/1/23,
SLMA*............................ 9,400
--------
41,300
--------
Continued
13
75
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
WEEKLY DEMAND NOTES, CONTINUED:
West Virginia (1.1%):
$ 2,300 Marion County Community Solid Waste
Disposal Facility Revenue, Grant
Town, AMT, 3.65%, 10/1/17, LOC:
National Westminister*........... $ 2,300
4,500 Marion County Community Solid Waste
Disposal Facility Revenue, Grant
Town, AMT, 3.50%, 10/1/17, LOC:
National Westminister*........... 4,500
--------
6,800
--------
Total Weekly Demand Notes 352,500
--------
Total (Amortized Cost $613,922) (a) $613,922
========
- ------------
Percentages indicated are based on net assets of $602,936.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
* Variable rate securities having liquidity agreements. The interest rate,
which will change periodically, is based upon an index of market rates. The
rate reflected on the Schedule of Portfolio Investments is the rate in effect
at June 30, 1998.
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax Paper
FGIC Insured by Financial Guaranty Insurance Corp.
FSA Insured by Financial Security Assurance
GO General Obligation
GTY Guaranty
FNMA Federal National Mortgage Association
IDR Industrial Development Revenue
LIQ Liquidity Agreement
LOC Letter of Credit
MBIA Insured by Municipal Bond Insurance Association
PCR Pollution Control Revenue
SLMA Student Loan Marketing Association
See notes to financial statements.
14
76
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
ANTICIPATION NOTES (13.0%):
Ohio (13.0%):
$2,200 Butler County, GO, BAN, 4.10%,
7/8/99........................... $ 2,208
2,000 Butler County, Sewer System, GO,
BAN, 4.29%, 8/6/98............... 2,001
3,000 Dublin Transportation System,
Series A, GO, 3.62%, 12/17/98.... 3,001
1,000 Lucas County Metro Sewer & Water,
GO, 4.11%, 10/21/98.............. 1,001
1,000 Ontario Village Board, GO, BAN,
4.20%, 12/23/98.................. 1,002
1,500 Pickerington School District, GO,
BAN, 4.07%, 8/3/98............... 1,501
1,100 Union County, GO, Colt Waterline
Construction, Series B, 4.01%,
6/17/99.......................... 1,103
3,250 University of Cincinnati, General
Receipts, BAN, Series AJ, 3.80%,
3/1/99........................... 3,254
--------
Total Anticipation Notes 15,071
--------
DAILY DEMAND NOTES (12.4%):
Ohio (12.4%):
400 Paulding, Solid Waste, Lafarge
Corp., 4.00%, 8/1/26, LOC: Royal
Bank of Canada*.................. 400
4,200 State Air Quality Development
Authority, Cincinnati Gas &
Electric, 3.80%, 12/1/15, LOC:
J.P. Morgan*..................... 4,200
300 State Air Quality Development
Authority, Cincinnati Gas &
Electric, Series A, 3.80%,
12/1/15, LOC: Union Bank of
Switzerland*..................... 300
2,400 State Air Quality Development
Authority, Cincinnati Gas &
Electric, Series A, 3.70%,
9/1/30, LOC: ABN AMRO Bank*...... 2,400
4,400 State PCR, British Petroleum,
4.00%, 5/1/22*................... 4,400
2,700 Twinsburg, IDR, United Stationers
Project, 3.95%, 12/1/11, LOC: PNC
Bank*............................ 2,700
--------
Total Daily Demand Notes 14,400
--------
MONTHLY DEMAND NOTES (4.2%):
Ohio (4.2%):
4,900 Housing Finance Agency, Kenwood
Retirement Project, 3.75%,
12/1/15, LOC: Morgan Guaranty*... 4,900
--------
Total Monthly Demand Notes 4,900
--------
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
MUNICIPAL BONDS (2.9%):
Ohio (2.9%):
$2,570 Hamilton County, Sewer Revenue,
Series A, 4.50%, 12/1/98, FGIC... $ 2,579
830 State Infrastructure, GO, Series R,
4.00%, 8/1/98.................... 830
--------
Total Municipal Bonds 3,409
--------
TAX FREE COMMERCIAL PAPER (7.1%):
Ohio (7.1%):
1,500 State Air Quality Development
Authority, Cleveland Electric
Illuminating Co., Series B,
3.75%, 7/9/98, FGIC.............. 1,500
2,500 State Air Quality Development
Authority, Cleveland Electric
Illuminating Co., Series B,
3.60%, 9/10/98, FGIC............. 2,500
2,500 State Air Quality Development
Authority, Cleveland Electric
Illuminating Co., Series B,
3.60%, 7/10/98, FGIC............. 2,500
300 Toledo-Lucas County, CSX
Transportation, 3.65%, 9/15/98,
LOC: Bank of Nova Scotia......... 300
1,500 Toledo-Lucas County, CSX
Transportation, 3.60%, 9/15/98,
LOC: Bank of Nova Scotia......... 1,500
--------
Total Tax Free Commercial Paper 8,300
--------
WEEKLY DEMAND NOTES (62.1%):
Ohio (62.1%):
5,600 Butler County, Meadow Ridge
Apartments, AMT, 3.50%, 11/15/30,
FNMA*............................ 5,600
4,000 Cleveland Airport System, Series D,
Airport Revenue, AMT, 3.60%,
1/1/27, LOC: Toronto Dominion
Bank*............................ 4,000
6,000 Clinton County, Hospital Revenue,
3.65%, 6/1/28, LOC: Fifth Third
Bank*............................ 6,000
2,000 Cuyahoga County, Hospital Revenue,
Cleveland Clinic Foundation,
Series A, 3.50%, 1/1/26, LOC:
Morgan Guaranty*................. 2,000
300 Cuyahoga County, IDR, Allen Group,
Inc., 3.50%, 4/1/12, LOC:
Dresdner Bank AG*................ 300
3,500 Franklin County, Hospital Revenue,
Holy Cross Health Systems, 3.45%,
6/1/16, LIQ: Morgan Guaranty*.... 3,500
1,500 Franklin County, Hospital Revenue,
Lutheran City, Inc. Project,
3.55%, 5/1/15, LOC: National Bank
of Detroit*...................... 1,500
Continued
15
77
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
WEEKLY DEMAND NOTES, CONTINUED:
Ohio, continued:
$1,300 Franklin County, Inland Products,
Inc., 3.75%, 6/1/04, LOC: PNC
Bank*............................ $ 1,300
2,000 Geauga County, IDR, General Signal
Corp., 3.65%, 4/1/04, LOC:
Wachovia Bank*................... 2,000
2,000 Hamilton County, Hospital
Facilities Revenue, Bethesda
Hospital, 3.40%, 2/15/24, LOC:
Rabobank Nederland*.............. 2,000
1,500 Hamilton County, Hospital
Facilities Revenue, Children's
Hospital Medical Center, 3.60%,
5/15/17, LOC: PNC Bank*.......... 1,500
5,125 Hamilton County, Hospital
Facilities Revenue, Health
Alliance of Cincinnati, Series B,
3.55%, 1/1/18, MBIA*............. 5,125
1,000 Hamilton County, Hospital
Facilities Revenue, Health
Alliance, Series F, 3.55%,
1/1/18, MBIA*.................... 1,000
3,000 Housing Finance Agency, Spring
Valley Apartments, 3.65%,
12/15/29, LOC: Key Bank*......... 3,000
6,050 Ohio State University, General
Receipts, 3.40%, 12/1/17*........ 6,050
560 Ohio State University, General
Receipts, Series B, 3.45%,
12/1/06, SBPA: National
Westminister Bank*............... 560
1,000 Ross County, Ohio Hospital
Facilities, Medical Center
Project, 3.55%, 12/1/20, LOC:
Fifth Third Bank*................ 1,000
3,600 State Air Quality Development
Authority, JMG Funding Ltd.
Partnership, AMT, 3.60%, 4/1/29,
LOC: Societe Generale*........... 3,600
PRINCIPAL AMORTIZED
AMOUNT SECURITY DESCRIPTION COST
- --------- ----------------------------------- ---------
WEEKLY DEMAND NOTES, CONTINUED:
Ohio, continued:
$2,100 State Air Quality Development
Authority, JMG Funding Ltd.
Partnership, Series A, AMT,
3.60%, 4/1/28, LOC: Societe
Generale*........................ $ 2,100
1,700 State Air Quality Development
Revenue Bond, Timken Co. Project,
AMT, 3.60%, 6/1/01, LOC: Credit
Suisse-First Boston*............. 1,700
1,300 State Higher Educational
Facilities, Oberlin College,
3.40%, 10/1/15, SBPA: Morgan
Guaranty*........................ 1,300
7,000 State Solid Waste Disposal Revenue,
USG Corp. Project, 3.60%, 8/1/32,
LOC: Chase Mahattan Bank*........ 7,000
2,000 State Water Development Authority,
Cleveland Electric, Series B,
3.25%, 8/1/20, LOC: First
National Bank of Chicago*........ 2,000
4,000 State Water Development Authority,
Timken Co. Project, 3.60%,
6/1/01, LOC: Wachovia Bank*...... 4,000
2,000 Student Loan Funding Corp., Series
1983-A, 4.40%, 12/29/98, LOC:
Bank of America*................. 2,000
2,100 Wooster, IDR, Allen Group, Inc.,
3.65%, 12/1/10, LOC: National
Bank of Detroit*................. 2,100
--------
Total Weekly Demand Notes 72,235
--------
Total (Amortized Cost $118,315)(a) $118,315
========
- ------------
Percentages indicated are based on net assets of $116,324.
(a) Cost and value for federal income tax and financial reporting purposes are
the same.
* Variable rate securities having liquidity agreements. The interest rate,
which will change periodically, is based an index of market rates. The rate
reflected on the Schedule of Portfolio Investments is the rate in effect at
June 30, 1998.
AMT Alternative Minimum Tax Paper
BAN Bond Anticipation Notes
FGIC Insured by Financial Guaranty Insurance Corp.
FNMA Insured by Federal National Mortgage Association
GO General Obligation
IDR Industrial Development Revenue
LIQ Liquidity Agreement
LOC Letter of Credit
MBIA Insured by Municipal Bond Insurance Association
PCR Pollution Control Revenue
SBPA Stand by Bond Purchase Agreement
See notes to financial statements.
16
78
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
U.S. TREASURY OHIO
SECURITIES MUNICIPAL MUNICIPAL
MONEY MARKET PRIME MONEY MONEY MARKET MONEY MARKET
FUND MARKET FUND FUND FUND
------------- ------------ ------------ ------------
ASSETS:
Investments, at amortized cost................ $ 756,587 $3,107,323 $613,922 $118,315
Repurchase agreements, at cost................ 3,392,616 102,434 -- --
---------- ---------- -------- --------
Total......................................... 4,149,203 3,209,757 613,922 118,315
Cash.......................................... -- 1 4,548 --
Interest receivable........................... 11,892 30,105 2,781 576
Receivable from brokers for investments
sold........................................ -- -- 20,790 --
Prepaid expenses and other assets............. 60 18 3 1
---------- ---------- -------- --------
TOTAL ASSETS.................................. 4,161,155 3,239,881 642,044 118,892
---------- ---------- -------- --------
LIABILITIES:
Cash overdraft................................ -- -- -- 2
Dividends payable............................. 15,780 13,774 1,562 304
Payable to brokers for investments
purchased................................... -- -- 37,293 2,209
Payable for return of collateral received for
securities on loan.......................... 255,663 -- -- --
Accrued expenses and other payables:
Investment advisory fees.................. 1,008 842 126 24
Administration fees....................... 466 416 78 9
12b-1 fees................................ 180 126 22 8
Other..................................... 918 822 27 12
---------- ---------- -------- --------
TOTAL LIABILITIES............................. 274,015 15,980 39,108 2,568
---------- ---------- -------- --------
NET ASSETS:
Capital....................................... 3,886,907 3,223,805 603,068 116,407
Undistributed (distributions in excess of) net
investment income........................... 193 7 (130) (75)
Accumulated undistributed net realized gains
(losses) from investment transactions....... 40 89 (2) (8)
---------- ---------- -------- --------
NET ASSETS.................................... $3,887,140 $3,223,901 $602,936 $116,324
========== ========== ======== ========
NET ASSETS:
Fiduciary................................. $3,025,608 $2,616,698 $498,127 $ 77,224
Class A................................... 861,350 605,291 104,809 39,100
Class B................................... 181 1,912 -- --
Class C................................... 1 -- -- --
---------- ---------- -------- --------
Total......................................... $3,887,140 $3,223,901 $602,936 $116,324
========== ========== ======== ========
OUTSTANDING UNITS OF BENEFICIAL INTEREST:
Fiduciary................................. 3,025,409 2,616,620 498,245 77,260
Class A................................... 861,313 605,275 104,821 39,122
Class B................................... 181 1,912 -- --
Class C................................... 1 -- -- --
---------- ---------- -------- --------
Total......................................... 3,886,904 3,223,807 603,066 116,382
========== ========== ======== ========
Net asset value--offering and redemption price
per share (Fiduciary, Class A, Class B, and
Class C shares)............................. $1.00 $1.00 $1.00 $1.00
========== ========== ======== ========
See notes to financial statements.
17
79
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
U.S. TREASURY OHIO
SECURITIES MUNICIPAL MUNICIPAL
MONEY MARKET PRIME MONEY MONEY MARKET MONEY MARKET
FUND MARKET FUND FUND FUND
------------- ------------- ------------- -------------
INVESTMENT INCOME:
Interest income........................... $184,497 $189,463 $21,708 $3,737
Dividend income........................... -- -- 165 80
Income from securities lending............ 150 -- -- --
-------- -------- ------- ------
Total Income.............................. 184,647 189,463 21,873 3,817
-------- -------- ------- ------
EXPENSES:
Investment advisory fees.................. 11,575 11,482 2,087 313
Administration fees....................... 5,416 5,374 977 171
12b-1 fees (Class A)...................... 1,955 1,399 258 97
12b-1 fees (Class B)...................... 1 10 -- --
Custodian and accounting fees............. 355 292 51 12
Legal and audit fees...................... 176 148 22 6
Organization costs........................ -- -- -- 1
Trustees' fees and expenses............... 104 92 11 1
Transfer agent fees....................... 638 391 33 22
Registration and filing fees.............. 881 721 105 17
Printing costs............................ 342 299 34 4
Other..................................... 381 151 13 2
-------- -------- ------- ------
Total expense before waivers.............. 21,824 20,359 3,591 646
Less waivers.............................. (2,892) (2,237) (677) (136)
-------- -------- ------- ------
Net Expenses.............................. 18,932 18,122 2,914 510
-------- -------- ------- ------
Net Investment Income..................... 165,715 171,341 18,959 3,307
-------- -------- ------- ------
REALIZED GAINS (LOSSES) FROM INVESTMENT
TRANSACTIONS:
Net realized gains (losses) from
investment transactions................. 40 89 11 8
-------- -------- ------- ------
Net increase in net assets resulting from
operations.............................. $165,755 $171,430 $18,970 $3,315
======== ======== ======= ======
See notes to financial statements.
18
80
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
U.S. TREASURY SECURITIES PRIME
MONEY MARKET FUND MONEY MARKET FUND
-------------------------- --------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
----------- ----------- ----------- -----------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income.................... $ 165,715 $ 121,830 $ 171,341 $ 140,355
Net realized gains (losses) from
investment transactions................ 40 190 89 27
----------- ----------- ----------- -----------
Change in net assets resulting from
operations.................................. 165,755 122,020 171,430 140,382
----------- ----------- ----------- -----------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income............... (129,665) (105,790) (144,494) (124,100)
From net realized gains from investment
transactions........................... -- (5) -- --
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income............... (36,044) (16,039) (26,806) (16,246)
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income............... (6) (1) (41) (9)
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net investment income............... --(a) -- -- --
----------- ----------- ----------- -----------
Change in net assets from shareholder
distributions............................... (165,715) (121,835) (171,341) (140,355)
----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
Proceeds from shares issued.............. 8,548,866 6,413,072 7,765,924 6,677,852
Dividends reinvested..................... 11,731 9,274 18,174 16,726
Cost of shares redeemed.................. (7,447,086) (5,604,396) (7,457,318) (6,299,509)
----------- ----------- ----------- -----------
Change in net assets from share
transactions................................ 1,113,511 817,950 326,780 395,069
----------- ----------- ----------- -----------
Change in Net Assets.......................... 1,113,551 818,135 326,869 395,096
NET ASSETS:
Beginning of period...................... 2,773,589 1,955,454 2,897,032 2,501,936
----------- ----------- ----------- -----------
End of period............................ $ 3,887,140 $ 2,773,589 $ 3,223,901 $ 2,897,032
=========== =========== =========== ===========
SHARE TRANSACTIONS:
Issued................................... 8,548,866 6,413,072 7,765,927 6,677,852
Reinvested............................... 11,731 9,274 18,174 16,726
Redeemed................................. (7,447,086) (5,604,396) (7,457,319) (6,299,509)
----------- ----------- ----------- -----------
Change in shares.............................. 1,113,511 817,950 326,782 395,069
=========== =========== =========== ===========
- ------------
(a) Amount is less than $1,000.
See notes to financial statements.
19
81
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
MUNICIPAL OHIO MUNICIPAL
MONEY MARKET FUND MONEY MARKET FUND
-------------------------- ----------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
----------- ----------- --------- ---------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income....................... $ 18,959 $ 16,457 $ 3,307 $ 2,727
Net realized gains (losses) from investment
transactions.............................. 11 (10) 8 (15)
----------- ----------- --------- ---------
Change in net assets resulting from operations... 18,970 16,447 3,315 2,712
----------- ----------- --------- ---------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income.................. (16,050) (15,228) (2,208) (1,662)
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income.................. (2,909) (1,229) (1,099) (1,065)
----------- ----------- --------- ---------
Change in net assets from shareholder
distributions.................................. (18,959) (16,457) (3,307) (2,727)
----------- ----------- --------- ---------
CAPITAL TRANSACTIONS:
Proceeds from shares issued................. 1,494,647 1,311,970 312,708 359,395
Dividends reinvested........................ 1,841 1,285 1,062 1,067
Cost of shares redeemed..................... (1,409,168) (1,308,167) (284,375) (370,573)
----------- ----------- --------- ---------
Change in net assets from share transactions..... 87,320 5,088 29,395 (10,111)
----------- ----------- --------- ---------
Change in Net Assets............................. 87,331 5,078 29,403 (10,126)
NET ASSETS:
Beginning of period......................... 515,605 510,527 86,921 97,047
----------- ----------- --------- ---------
End of period............................... $ 602,936 $ 515,605 $ 116,324 $ 86,921
=========== =========== ========= =========
SHARE TRANSACTIONS:
Issued...................................... 1,494,647 1,311,970 312,708 359,395
Reinvested.................................. 1,841 1,285 1,062 1,067
Redeemed.................................... (1,409,168) (1,308,167) (284,375) (370,573)
----------- ----------- --------- ---------
Change in shares................................. 87,320 5,088 29,395 (10,111)
=========== =========== ========= =========
See notes to financial statements.
20
82
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS JUNE 30, 1998
1. ORGANIZATION:
The One Group (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end investment company
established as a Massachusetts business trust. The accompanying financial
statements and financial highlights are those of the U.S. Treasury Securities
Money Market Fund, the Prime Money Market Fund, the Municipal Money Market
Fund, and the Ohio Municipal Money Market Fund (individually, a "Fund";
collectively, the "Funds") only. Each Fund is a diversified mutual fund,
except the Ohio Municipal Money Market Fund which is non-diversified.
The Funds' investment objectives are as follows:
FUND OBJECTIVE
---- ---------
U.S. Treasury Securities Money Market Fund Current income with liquidity and stability of
principal.
Prime Money Market Fund Current income with liquidity and stability of
principal.
Municipal Money Market Fund As high a level of current interest income
exempt from Federal income tax as is consistent
with capital preservation and stability of
principal.
Ohio Municipal Money Market Fund As high a level of current interest income
exempt from Federal income tax and Ohio
personal income tax as is consistent with
capital preservation and stability of
principal.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for the
period. Actual results could differ from those estimates.
SECURITY VALUATION
Securities are valued utilizing the amortized cost method permitted in
accordance with Rule 2a-7 under the 1940 Act. Under the amortized cost
method, discount or premium is amortized on a constant basis to the
maturity of the security. In addition, the Funds may not (a) purchase any
instrument with a remaining maturity greater than 397 days unless such
instrument is subject to a demand feature, or (b) maintain a
dollar-weighted average maturity which exceeds 90 days.
REPURCHASE AGREEMENTS
The Funds may invest in repurchase agreements with institutions that are
deemed by Banc One Investment Advisors Corporation (the "Advisor") to be
of good standing and creditworthy under guidelines established by the
Board of Trustees. Each repurchase agreement is recorded at cost. The
Fund requires that the securities purchased in a repurchase transaction
be transferred to the custodian in a manner sufficient to enable the Fund
to obtain those securities in the event of a counterparty default. The
seller, under the repurchase agreement, is required to maintain the value
of the securities held at not less than the repurchase price, including
accrued interest. Repurchase agreements are considered to be loans by a
fund under the 1940 Act.
Continued
21
83
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
SECURITY TRANSACTIONS AND RELATED INCOME
Security transactions are accounted for on a trade date basis. Net
realized gains or losses on sales of securities are determined on the
specific identification cost method. Interest income and expenses are
recognized on the accrual basis. Interest income, including any discount
or premium, is accrued as earned using the effective interest method.
SECURITIES LENDING
To generate additional income, the Funds may lend up to 33% of securities
in which they are invested pursuant to agreements requiring that the loan
be continuously secured by cash, U.S. Government or U.S. Government
Agency securities, shares of an investment trust or mutual fund, or any
combination of cash and such securities as collateral equal at all times
to at least 100% of the market value plus accrued interest on the
securities lent. The Funds continue to earn interest on securities lent
while simultaneously seeking to earn interest on the investment of
collateral. Collateral is marked to market daily to provide a level of
collateral at least equal to the market value of securities lent. There
may be risks of delay in recovery of the securities or even loss of
rights in the collateral should the borrower of the securities fail
financially. However, loans will be made only to borrowers deemed by the
Advisor to be of good standing and creditworthy under guidelines
established by the Board of Trustees and when, in the judgment of the
Advisor, the consideration which can be earned currently from such
securities loans justifies the attendant risks. Loans are subject to
termination by the Funds or the borrower at any time, and are, therefore,
not considered to be illiquid investments. As of June 30, 1998, the
following Fund had securities with the following amortized cost on loan
(amount in thousands):
AMORTIZED COST AMORTIZED COST
OF COLLATERAL OF LOANED SECURITIES
-------------- --------------------
U.S. Treasury Securities Money Market Fund................ $255,663 $250,570
The loaned securities were fully collateralized by cash and U.S.
Government securities as of June 30, 1998.
EXPENSES
Expenses directly attributable to a Fund are charged directly to that
Fund, while the expenses which are attributable to more than one fund of
the Trust are allocated among the respective Funds. Each class of shares
bears its pro-rata portion of expenses attributable to its series, except
that each class separately bears expenses related specifically to that
class, such as distribution fees.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income are declared daily and paid monthly.
Net income for this purpose consists of interest accrued and discount
earned (including both original issue discount and market discount) less
amortization of any market premium and accrued expenses. Net realized
capital gains, if any, are distributed at least annually. Dividends are
declared separately for each class. No class has preferential dividend
rights; differences in per share dividend rates are due to differences in
separate class expenses.
Net investment income and net capital gain distributions 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 expiring capital loss carryforwards and deferrals
of certain losses. Permanent book and tax differences, if any, have been
reclassified among the components of net assets.
Continued
22
84
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
FEDERAL INCOME TAXES
Each Fund intends to continue to qualify as a regulated investment
company by complying with the provisions available to certain investment
companies as defined in applicable sections of the Internal Revenue Code,
and to make distributions of net investment income and net realized
capital gains sufficient to relieve it from all, or substantially all,
federal income taxes.
3. SHARES OF BENEFICIAL INTEREST:
The Trust has an unlimited number of shares of beneficial interest, with no
par value, which may, without shareholder approval, be divided into an
unlimited number of series of such shares and any series may be classified or
reclassified into one or more classes. The Trust is registered to offer forty
series and five classes of shares: Fiduciary Class, Class A, Class B, Class C
and Service Class. Currently, the Trust consists of thirty-three active
funds. The Funds are each authorized to issue Fiduciary Class, Class A and
Class C Shares. In addition, the U.S. Treasury Securities Money Market Fund
and the Prime Money Market Fund are authorized to issue Class B and Service
Class Shares. As of June 30, 1998 there were no shareholders in Class C
(except for the U.S. Treasury Securities Money Market Fund) or the Service
Class. Shareholders are entitled to one vote for each full share held and
will vote in the aggregate and not by class or series, except as otherwise
expressly required by law or when the Board of Trustees has determined that
the matter to be voted on affects only the interest of shareholders of a
particular class or series. The following is a summary of transactions in
Fund shares for the fiscal years ending June 30, 1998 and 1997:
Continued
23
85
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
U.S. TREASURY SECURITIES PRIME MONEY
MONEY MARKET FUND MARKET FUND
------------------------- -------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued............................. $6,794,618 $ 4,920,570 $5,665,895 $ 4,681,923
Dividends reinvested.................................... 443 521 1,891 1,986
Cost of shares redeemed................................. (6,012,860) (4,522,461) (5,614,930) (4,306,729)
----------- ----------- ----------- -----------
Change in net assets from Fiduciary share
transactions.......................................... 782,201 398,630 52,856 377,180
=========== =========== =========== ===========
CLASS A SHARES:
Proceeds from shares issued............................. $1,753,840 $ 1,492,429 $2,096,713 $ 1,994,727
Dividends reinvested.................................... 11,283 8,752 16,253 14,734
Cost of shares redeemed................................. (1,433,946) (1,081,910) (1,840,335) (1,992,191)
----------- ----------- ----------- -----------
Change in net assets from
Class A share transactions............................ $ 331,177 $ 419,271 $ 272,631 $ 17,270
=========== =========== =========== ===========
CLASS B SHARES:
Proceeds from shares issued............................. $ 407 $ 73 $ 3,316 $ 1,202
Dividends reinvested.................................... 5 1 30 6
Cost of shares redeemed................................. (280) (25) (2,053) (589)
----------- ----------- ----------- -----------
Change in net assets from
Class B share transactions............................ $ 132 $ 49 $ 1,293 $ 619
=========== =========== =========== ===========
CLASS C SHARES:
Proceeds from shares issued............................. $ 1
Dividends reinvested.................................... --
Cost of shares redeemed................................. --
-----------
Change in net assets from Class C share transactions.... $ 1
===========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued.................................................. 6,794,618 4,920,570 5,665,897 4,681,923
Reinvested.............................................. 443 521 1,891 1,986
Redeemed................................................ (6,012,860) (4,522,461) (5,614,931) (4,306,729)
----------- ----------- ----------- -----------
Change in Fiduciary Shares.............................. 782,201 398,630 52,857 377,180
=========== =========== =========== ===========
CLASS A SHARES:
Issued.................................................. 1,753,840 1,492,429 2,096,713 1,994,727
Reinvested.............................................. 11,283 8,752 16,253 14,734
Redeemed................................................ (1,433,946) (1,081,910) (1,840,335) (1,992,191)
----------- ----------- ----------- -----------
Change in Class A Shares................................ 331,177 419,271 272,631 17,270
=========== =========== =========== ===========
CLASS B SHARES:
Issued.................................................. 407 73 3,317 1,202
Reinvested.............................................. 5 1 30 6
Redeemed................................................ (280) (25) (2,053) (589)
----------- ----------- ----------- -----------
Change in Class B Shares................................ 132 49 1,294 619
=========== =========== =========== ===========
CLASS C SHARES:
Issued.................................................. 1
Reinvested.............................................. --
Redeemed................................................ --
-----------
Change in Class C Shares................................ 1
===========
Continued
24
86
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
MUNICIPAL MONEY MARKET OHIO MUNICIPAL
FUND MONEY MARKET FUND
------------------------- -------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued............................. $1,087,776 $ 1,104,184 $ 199,296 $ 178,921
Dividends reinvested.................................... 171 138 55 87
Cost of shares redeemed................................. (1,057,248) (1,096,700) (178,572) (178,473)
----------- ----------- ----------- -----------
Change in net assets from
Fiduciary share transactions.......................... $ 30,699 $ 7,622 $ 20,779 $ 535
=========== =========== =========== ===========
CLASS A SHARES:
Proceeds from shares issued............................. $ 406,871 $ 207,786 $ 113,412 $ 180,474
Dividends reinvested.................................... 1,670 1,147 1,007 980
Cost of shares redeemed................................. (351,920) (211,467) (105,803) (192,100)
----------- ----------- ----------- -----------
Change in net assets from
Class A share transactions.......................... $ 56,621 $ (2,534) $ 8,616 $ (10,646)
=========== =========== =========== ===========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued.................................................. 1,087,776 1,104,184 199,296 178,921
Reinvested.............................................. 171 138 55 87
Redeemed................................................ (1,057,248) (1,096,700) (178,572) (178,473)
----------- ----------- ----------- -----------
Change in Fiduciary Shares.............................. 30,699 7,622 20,779 535
=========== =========== =========== ===========
CLASS A SHARES:
Issued.................................................. 406,871 207,786 113,412 180,474
Reinvested.............................................. 1,670 1,147 1,007 980
Redeemed................................................ (351,920) (211,467) (105,803) (192,100)
----------- ----------- ----------- -----------
Change in Class A Shares................................ 56,621 (2,534) 8,616 (10,646)
=========== =========== =========== ===========
Continued
25
87
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
4. INVESTMENT ADVISORY, ADMINISTRATIVE, AND DISTRIBUTION AGREEMENTS:
The Trust and the Advisor, are parties to an investment advisory agreement
under which the Advisor is entitled to receive an annual fee, computed daily
and paid monthly, equal to 0.35% of the average daily net assets of the U.S.
Treasury Securities Money Market Fund, the Prime Money Market Fund and the
Municipal Money Market Fund and 0.30% of the average daily net assets of the
Ohio Municipal Money Market Fund.
The Trust and The One Group Services Company (the "Administrator"), a
wholly-owned subsidiary of The BISYS Group, Inc., are parties to an
administration agreement under which the Administrator provides services for
a fee that is computed daily and paid monthly, at an annual rate of 0.20% on
each Fund's average daily net assets on the first $1.5 billion of Trust net
assets (excluding the Investor Growth Fund, the Investor Growth & Income
Fund, the Investor Conservative Growth Fund and the Investor Balanced Fund
(the "Investor Funds") and the Treasury Only Money Market Fund and the
Government Money Market Fund (the "Institutional Money Market Funds")); 0.18%
on the next $0.5 billion of Trust net assets (excluding the Investor Funds
and the Institutional Money Market Funds); and 0.16% on Trust net assets
(excluding the Investor Funds and the Institutional Money Market Funds) over
$2 billion. The Advisor also serves as Sub-Administrator to each Fund of the
Trust, pursuant to an agreement between the Administrator and the Advisor.
Pursuant to this agreement, the Advisor performs many of the Administrator's
duties, for which the Advisor receives a fee paid by the Administrator.
The Trust and The One Group Services Company (the "Distributor") are parties
to a distribution agreement under which shares of the Funds are sold on a
continuous basis. Class A Shares, Class B Shares, Class C Shares and Service
Class Shares are subject to distribution and shareholder services plans (the
"Plans") pursuant to Rule 12b-1 under the 1940 Act. As provided in the Plans,
the Trust will pay the Distributor a fee of 0.25% of the average daily net
assets of Class A shares of each of the Funds, 1.00% of the average daily net
assets of Class B and Class C Shares and 0.75% of the average daily net
assets of the Service Class Shares of each of the Funds. The Distributor has
voluntarily agreed to limit payments under the Plans to 0.55% of average
daily net assets of the Service Class Shares of each Fund. Up to 0.25% of the
fees payable under the Plans may be used as compensation of shareholder
services by the Distributor and/or financial institutions and intermediaries.
Fees paid under the Plans may be applied by the Distributor toward (i)
compensation for its services in connection with distribution assistance or
provision of shareholder services; or (ii) payments to financial institutions
and intermediaries such as banks (including affiliates of the Advisor),
brokers, dealers and other institutions, including the Distributor's
affiliates and subsidiaries as compensation for services or reimbursement of
expenses incurred in connection with distribution assistance or provision of
shareholder services. Fiduciary Class Shares of each Fund are offered without
distribution fees.
Certain officers of the Trust are affiliated with the Administrator. Such
officers receive no compensation from the Funds for serving in their
respective roles.
The Advisor, Administrator and the Distributor voluntarily agreed to waive a
portion of their fees. For the year ended June 30, 1998, fees in the
following amounts were waived from the Funds (amounts in thousands):
Continued
26
88
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
INVESTMENT 12B-1 FEES
ADVISORY FEES ADMINISTRATION WAIVED
WAIVED FEES WAIVED CLASS A
------------- -------------- ----------
U.S. Treasury Securities Money Market Fund................. $2,237 $570 $ 85
Prime Money Market Fund.................................... 1,675 500 62
Municipal Money Market Fund................................ 596 68 13
Ohio Municipal Money Market Fund........................... 60 72 4
5. CONCENTRATION OF CREDIT RISK:
The Ohio Municipal Money Market Fund invests primarily in debt obligations
issued by the State of Ohio and its political subdivisions, agencies and
public authorities to obtain funds for various public purposes. The Fund is
more susceptible to economic and political factors adversely affecting
issuers of Ohio's specific municipal securities than are municipal bond funds
that are not concentrated in these issuers to the same extent.
6. FEDERAL TAX INFORMATION (UNAUDITED):
At June 30, 1998, the following funds had capital loss carryforwards which
are available to offset future capital gains if any (amounts in thousands):
CAPITAL LOSS
CARRYFORWARD EXPIRES
------------ -------
Municipal Money Market Fund................................. $2 2005
Ohio Municipal Money Market Fund............................ 8 2005
Distributions paid from tax-exempt income during the fiscal year ended June
30, 1998 are as follows (amounts in thousands):
Municipal Money Market Fund................................. $18,880
Ohio Municipal Money Market Fund............................ 3,242
7. SUBSEQUENT EVENTS:
On May 21, 1998, the Board of Trustees approved an agreement and plan of
reorganization and liquidation ("the Plan") with the Marquis Family of Funds
(the "Marquis Funds"). Under the Plan, the assets and liabilities of each
Marquis fund were transferred to a comparable One Group fund. Shares of the
comparable One Group fund were distributed to the Marquis shareholders in a
complete liquidation of each Marquis fund. A special Shareholder Meeting to
approve the plan was held on July 30, 1998. In a tax-free exchange on August
10, 1998, net assets of the Marquis funds were exchanged for shares of a
corresponding fund of The One Group as follows (amounts in thousands):
SHARES NET ASSETS
ONE GROUP FUND ISSUED MARQUIS FUND CONVERTED
-------------- --------- ------------ ----------
U.S. Treasury Securities Money Market
Fund............................... 1,232,968 Treasury Securities Money Market Fund $1,232,968
Municipal Money Market Fund.......... 161,019 Tax Exempt Money Market Fund 161,019
Continued
27
89
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS JUNE 30, 1998
U.S. TREASURY SECURITIES MONEY MARKET FUND
----------------------------------------------------------------
FIDUCIARY
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
---------- ---------- ---------- ---------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD.............. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
---------- ---------- ---------- ---------- --------
Investment Activities:
Net investment income............ 0.051 0.050 0.052 0.050 0.030
---------- ---------- ---------- ---------- --------
Less Distributions:
Net investment income............ (0.051) (0.050)(a) (0.052) (0.050) (0.030)
---------- ---------- ---------- ---------- --------
NET ASSET VALUE,
END OF PERIOD.................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
========== ========== ========== ========== ========
Total Return....................... 5.19% 5.07% 5.34% 5.07% 3.01%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period...... $3,025,608 $2,243,376 $1,844,590 $1,178,091 $969,326
Ratio of expenses to average net
assets........................ 0.52% 0.46% 0.42% 0.41% 0.40%
Ratio of net investment income to
average net assets............ 5.07% 4.95% 5.17% 4.96% 3.02%
Ratio of expenses to average net
assets*....................... 0.60% 0.57% 0.56% 0.59% 0.58%
Ratio of net investment income to
average net assets*........... 4.99% 4.84% 5.03% 4.78% 2.84%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Includes $.000002 short term capital gain.
See notes to financial statements.
28
90
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
U.S. TREASURY SECURITIES MONEY MARKET FUND
------------------------------------------------------
CLASS A
------------------------------------------------------
YEAR ENDED JUNE 30,
------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD........................ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------- -------- -------- ------- -------
Investment Activities:
Net investment income...................... 0.048 0.047 0.050 0.047 0.027
-------- -------- -------- ------- -------
Less: Distributions:
Net investment income...................... (0.048) (0.047)(a) (0.050) (0.047) (0.027)
-------- -------- -------- ------- -------
NET ASSET VALUE,
END OF PERIOD.............................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ======= =======
Total Return................................. 4.92% 4.81% 5.08% 4.81% 2.76%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).......... $861,350 $530,164 $110,864 $98,723 $53,423
Ratio of expenses to average net assets.... 0.77% 0.72% 0.67% 0.66% 0.63%
Ratio of net investment income to average
net assets.............................. 4.82% 4.71% 4.92% 4.71% 2.81%
Ratio of expenses to average net assets*... 0.86% 0.93% 0.91% 0.94% 0.87%
Ratio of net investment income to average
net assets*............................. 4.73% 4.50% 4.68% 4.43% 2.57%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Includes $.000002 short term capital gain.
See notes to financial statements.
29
91
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
U.S. TREASURY SECURITIES
MONEY MARKET FUND
------------------------
CLASS B
------------------------
YEAR NOVEMBER 21,
ENDED 1996 TO
JUNE 30, JUNE 30,
1998 1997(a)
------ ------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $1.000 $1.000
------ ------
Investment Activities:
Net investment income..................................... 0.041 0.024
------ ------
Less: Distributions:
Net investment income..................................... (0.041) (0.024)(b)
------ ------
NET ASSET VALUE,
END OF PERIOD............................................. $1.000 $1.000
====== ======
Total Return................................................ 4.14% 2.44%(c)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 181 $ 49
Ratio of expenses to average net assets................... 1.52% 1.48%(d)
Ratio of net investment income to average net assets...... 4.06% 3.97%(d)
Ratio of expenses to average net assets*.................. 1.60% 1.59%(d)
Ratio of net investment income to average net assets*..... 3.98% 3.86%(d)
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Includes $.000002 short term capital gain.
(c) Not annualized.
(d) Annualized.
See notes to financial statements.
30
92
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
U.S. TREASURY SECURITIES
MONEY MARKET FUND
------------------------
CLASS C
-------
FEBRUARY 18,
1998 TO
JUNE 30,
1998(a)
-------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 1.000
-------
Investment Activities:
Net investment income..................................... 0.015
-------
Less: Distributions:
Net investment income..................................... (0.015)
-------
NET ASSET VALUE,
END OF PERIOD............................................. $ 1.000
=======
Total Return................................................ 1.47%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 1
Ratio of expenses to average net assets................... 1.57%(c)
Ratio of net investment income to average net assets...... 4.01%(c)
- ------------
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
See notes to financial statements.
31
93
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
PRIME MONEY MARKET FUND
--------------------------------------------------------------
FIDUCIARY
--------------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------------
1998 1997 1996 1995 1994
---------- ---------- ---------- ---------- ----------
NET ASSET VALUE,
BEGINNING OF PERIOD................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
---------- ---------- ---------- ---------- ----------
Investment Activities:
Net investment income................. 0.053 0.051 0.054 0.052 0.031
---------- ---------- ---------- ---------- ----------
Less: Distributions:
Net investment income................. (0.053) (0.051) (0.054) (0.052) (0.031)
---------- ---------- ---------- ---------- ----------
NET ASSET VALUE,
END OF PERIOD......................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
========== ========== ========== ========== ==========
Total Return............................ 5.39% 5.20% 5.49% 5.34% 3.19%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..... $2,616,698 $2,563,768 $2,186,562 $1,965,416 $1,600,876
Ratio of expenses to average net
assets............................. 0.51% 0.48% 0.44% 0.41% 0.40%
Ratio of net investment income to
average net assets................. 5.26% 5.08% 5.34% 5.27% 3.18%
Ratio of expenses to average net
assets*............................ 0.58% 0.56% 0.55% 0.57% 0.59%
Ratio of net investment income to
average net assets*................ 5.19% 5.00% 5.23% 5.12% 2.99%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
32
94
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
PRIME MONEY MARKET FUND
---------------------------------------------------
CLASS A
---------------------------------------------------
YEAR ENDED JUNE 30,
---------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD........................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------- -------- -------- -------- -------
Investment Activities:
Net investment income......................... 0.050 0.048 0.051 0.050 0.027
-------- -------- -------- -------- -------
Less: Distributions:
Net investment income......................... (0.050) (0.048) (0.051) (0.050) (0.027)
-------- -------- -------- -------- -------
NET ASSET VALUE,
END OF PERIOD................................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ======== =======
Total Return.................................... 5.13% 4.94% 5.22% 5.08% 2.93%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)............. $605,291 $332,646 $315,374 $201,968 $74,759
Ratio of expenses to average net assets....... 0.76% 0.73% 0.69% 0.67% 0.65%
Ratio of net investment income to average net
assets..................................... 5.01% 4.83% 5.09% 5.02% 2.92%
Ratio of expenses to average net assets*...... 0.83% 0.91% 0.90% 0.92% 0.90%
Ratio of net investment income to average net
assets*.................................... 4.94% 4.65% 4.88% 4.77% 2.67%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
33
95
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
PRIME MONEY MARKET FUND
--------------------------
CLASS B
--------------------------
YEAR NOVEMBER 21,
ENDED 1996 TO
JUNE 30, JUNE 30,
1998 1997(a)
-------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $1.000 $1.000
------ ------
Investment Activities:
Net investment income..................................... 0.043 0.026
------ ------
Less: Distributions:
Net investment income..................................... (0.043) (0.026)
------ ------
NET ASSET VALUE,
END OF PERIOD............................................. $1.000 $1.000
====== ======
Total Return................................................ 4.35% 2.63%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $1,912 $ 618
Ratio of expenses to average net assets................... 1.51% 1.51%(c)
Ratio of net investment income to average net assets...... 4.25% 4.16%(c)
Ratio of expenses to average net assets*.................. 1.57% 1.59%(c)
Ratio of net investment income to average net assets*..... 4.19% 4.08%(c)
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
See notes to financial statements.
34
96
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
MUNICIPAL MONEY MARKET FUND
----------------------------------------------------
FIDUCIARY
----------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD.......................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------- -------- -------- -------- --------
Investment Activities:
Net investment income........................ 0.032 0.031 0.033 0.032 0.021
-------- -------- -------- -------- --------
Less: Distributions:
Net investment income........................ (0.032) (0.031) (0.033) (0.032) (0.021)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD................................ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======== ======== ======== ========
Total Return................................... 3.27% 3.19% 3.34% 3.28% 2.16%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)............ $498,127 $467,420 $459,807 $437,743 $352,702
Ratio of expenses to average net assets...... 0.45% 0.43% 0.41% 0.41% 0.40%
Ratio of net investment income to average net
assets.................................... 3.22% 3.16% 3.29% 3.26% 2.13%
Ratio of expenses to average net assets*..... 0.56% 0.55% 0.59% 0.59% 0.60%
Ratio of net investment income to average net
assets*................................... 3.11% 3.04% 3.11% 3.08% 1.93%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary fee
reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
35
97
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
MUNICIPAL MONEY MARKET FUND
------------------------------------------------
CLASS A
------------------------------------------------
YEAR ENDED JUNE 30,
------------------------------------------------
1998 1997 1996 1995 1994
-------- ------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD.............................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
-------- ------- ------- ------- -------
Investment Activities:
Net investment income............................ 0.030 0.029 0.030 0.030 0.021
-------- ------- ------- ------- -------
Less: Distributions:
Net investment income............................ (0.030) (0.029) (0.030) (0.030) (0.021)
-------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD.................................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======== ======= ======= ======= =======
Total Return....................................... 3.01% 2.97% 3.08% 3.02% 1.96%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)................ $104,809 $48,185 $50,720 $56,518 $41,595
Ratio of expenses to average net assets.......... 0.70% 0.68% 0.66% 0.66% 0.65%
Ratio of net investment income to average net
assets........................................ 2.97% 2.91% 3.04% 3.01% 1.92%
Ratio of expenses to average net assets*......... 0.81% 0.90% 0.94% 0.94% 0.91%
Ratio of net investment income to average net
assets*....................................... 2.86% 2.69% 2.76% 2.73% 1.66%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary fee
reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
36
98
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
OHIO MUNICIPAL MONEY MARKET FUND
---------------------------------------------------
FIDUCIARY
---------------------------------------------------
YEAR ENDED JUNE 30,
---------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD.................................. $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------- ------- ------- ------- -------
Investment Activities:
Net investment income................................ 0.033 0.032 0.033 0.032 0.022
------- ------- ------- ------- -------
Less: Distributions:
Net investment income................................ (0.033) (0.032) (0.032) (0.032) (0.022)
In excess of net investment.......................... -- -- (0.001) -- --
------- ------- ------- ------- -------
Total Distributions............................... (0.033) (0.032) (0.033) (0.032) (0.022)
------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD........................................ $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======= ======= ======= ======= =======
Total Return........................................... 3.31% 3.22% 3.34% 3.20% 2.25%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $77,224 $56,442 $55,915 $51,806 $55,375
Ratio of expenses to average net assets.............. 0.40% 0.40% 0.41% 0.41% 0.34%
Ratio of net investment income to average net
assets............................................ 3.27% 3.17% 3.19% 3.13% 2.29%
Ratio of expenses to average net assets*............. 0.53% 0.53% 0.71% 0.60% 0.57%
Ratio of net investment income to average net
assets*........................................... 3.14% 3.04% 2.89% 2.94% 2.06%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary fee
reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
37
99
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
OHIO MUNICIPAL MONEY MARKET FUND
-----------------------------------------------
CLASS A
-----------------------------------------------
YEAR ENDED JUNE 30,
-----------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD............................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
------- ------- ------- ------- -------
Investment Activities:
Net investment income............................. 0.030 0.029 0.030 0.029 0.021
------- ------- ------- ------- -------
Less: Distributions:
Net investment income............................. (0.030) (0.029) (0.029) (0.029) (0.021)
In excess of net investment....................... -- -- (0.001) -- --
------- ------- ------- ------- -------
Total Distributions............................ (0.030) (0.029) (0.030) (0.029) (0.021)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD...................... $ 1.000 $ 1.000 $ 1.000 $ 1.000 $ 1.000
======= ======= ======= ======= =======
Total Return........................................ 3.06% 2.96% 3.08% 2.98% 2.09%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)................. $39,100 $30,479 $41,132 $35,790 $37,356
Ratio of expenses to average net assets........... 0.65% 0.65% 0.66% 0.63% 0.44%
Ratio of net investment income to average net
assets......................................... 2.98% 2.90% 2.94% 2.91% 2.05%
Ratio of expenses to average net assets*.......... 0.78% 0.88% 1.06% 0.95% 0.94%
Ratio of net investment income to average net
assets*........................................ 2.85% 2.67% 2.54% 2.59% 1.55%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary fee
reductions had not occurred, the ratios would have been as indicated.
See notes to financial statements.
38
100
- --------------------------------------------------------------------------------
Report of Independent Accountants
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1997
To the Shareholders and Board of Trustees of
The One Group Family of Mutual Funds:
In our opinion, the accompanying statements of assets and liabilities, including
the portfolios of investments, and related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the U.S. Treasury Securities Money
Market Fund, the Prime Money Market Fund, the Municipal Money Market Fund and
the Ohio Municipal Money Market Fund (four series of The One Group Family of
Mutual Funds), at June 30, 1998, the results of each of their operations for the
period then ended, the changes in each of their net assets for the periods
presented and the financial highlights for each of the periods presented, in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of The One Group Family of Mutual Funds'
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities at June 30, 1998 by correspondence with the custodian
and brokers, provide a reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
August 18, 1998
See notes to financial statements.
39
101
Important Customer Information.
Please Read:
Shares of The One Group:
- - are not deposits or obligations
of, or guaranteed by BANC One
CORPORATION or its affiliates
- - are not insured or guaranteed by the
FDIC or by any other governmental
agency or government-sponsored
agency of the federal government
or any state
- - are subject to investment risks,
including possible loss of the
principal amount invested.
Banc One Investment Advisors
Corporation, a registered investment
advisor and an indirect subsidiary of
BANC ONE CORPORATION, serves
as an investment advisor to The One
Group, for which it receives advisory
fees. The One Group is distributed by
The One Group Services Company,
3435 Stelzer Road, Columbus,
Ohio 43219, which is not affiliated
with BANC ONE CORPORATION and
is not a bank. Contact us at our web
site address: www.onegroup.com or
e-mail us at onegroup@onegroup.com
For more complete information on
any of The One Group Funds, includ-
ing management fees and expenses,
you may obtain a prospectus from
The One Group Services Company.
Read the prospectus carefully
before investing.
BANC ONE
INVESTMENT
ADVISORS
CORPORATION
[BANC ONE LOGO]
102
GROWTH
FUNDS
ANNUAL REPORT
For the year ended June 30, 1998
Asset Allocation Fund
Income Equity Fund
Equity Income Fund
Value Growth Fund
Large Company Value Fund
Disciplined Value Fund
Large Company Growth Fund
Growth Opportunities Fund
Small Capitalization Fund
International Equity Index Fund
THE ONE GROUP(R)
- ----------------
FAMILY OF MUTUAL FUNDS
103
IMPORTANT CUSTOMER INFORMATION. INVESTMENT PRODUCTS:
* are not deposits or obligations of, or guaranteed by,
BANC ONE CORPORATION or any of its affiliates.
* are not insured by the FDIC, and [FDIC Logo
with slash thru it]
* are subject to investment risks, including possible
loss of the principal amount invested.
104
- --------------------------------------------------------------------------------
Table of Contents
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Portfolio Performance Review................................................ 2
Schedules of Portfolio Investments........................................... 28
Statements of Assets and Liabilities......................................... 88
Statements of Operations..................................................... 92
Statements of Changes in Net Assets.......................................... 94
Statements of Cash Flows..................................................... 98
Notes to Financial Statements................................................ 99
Financial Highlights.........................................................113
Report of Independent Accountants............................................150
1
105
The One Group Asset Allocation Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group Asset Allocation Fund Fiduciary
share class posted a total return of 22.12%. (For information on other share
classes and performance comparisons to indexes, please see page 4.)
WHAT WERE YOUR OVERALL STRATEGIES AND TACTICS?
In November 1997, we increased the Fund's equity weighting by 2%, bringing the
asset allocation to 57% equities and 43% fixed income. Our research indicated
that while stock valuations remained fairly high, corporate profitability was
strong, which prompted the slight shift toward equities. Nonetheless, the
allocation remains fairly conservative compared to our benchmark of 60% equities
and 40% fixed income.
The 1997 tax law created three categories of capital gains: short-term, for
securities held less than a year and taxed as regular income; mid-term, for
securities held from one year to 18 months and taxed at 28%; and long-term for
securities held for at least 18 months and taxed at 20%. To limit the number of
short-term gains, we held securities longer, reducing the Fund's turnover rate
from an average of 81% to 46% during the year.
HOW DID EVENTS PLAY OUT IN THE FUND'S EQUITY PORTFOLIO?
Overall, corporate earnings exceeded expectations throughout the year,
contributing to the stock market's strong performance. At the same time, a
favorable interest rate environment helped support additional gains in the
market.
The equity philosophy of the Fund is research driven. Our bottom-up stock
selection approach led to attractive results in the Fund's equity portfolio.
Instead of trying to time the market or focus on certain areas of the market, we
rely on fundamental research to select individual stocks from all market
sectors. As a result, the Fund's stock portfolio represents the "best ideas" of
the equity research team. Equity returns were driven by stock selection, not
market timing or sector rotation.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
During the fiscal year, the Fund's equity portfolio benefited from particularly
good stock selection in the following sectors: technology (Dell Computer, up
216%); retail (Wal-Mart, up 80%); health care (Warner-Lambert, up 68%); and
telephone utilities (LCI International, up 65%).
HOW DID THE PORTFOLIO'S TOP 10 HOLDINGS CHANGE?*
Six of fiscal 1997's top 10 holdings remained among the top 10 during the past
year: Microsoft, 1.9% (technology), General Electric, 1.6% (capital goods),
Exxon, 1.2% (energy) Wal-Mart, 1.0%, Bristol-Myers Squibb, 1.0% (health care)
and Intel, 1.0% (technology). The remaining top 10 stock holdings included
Nations-Bank, 1.0% (financial services), Cisco Systems, 1.0% (technology), Dell
Computer, 1.0% and Travelers Group, 0.8% (financial services).
HOW DID EVENTS PLAY OUT IN THE FUND'S FIXED INCOME PORTFOLIO?
The largest contributing factor to the Fund's fixed income portfolio was the
general decline in interest rates, which led to a corresponding increase in bond
prices. Events in Asia contributed to a weakening global economy, which in turn
contributed to a general decrease in U.S. bond market yields and an increase in
U.S. bond prices.
We maintained diversity among government, agency mortgage-backed, asset-backed
and corporate securities. With only a moderate level of volatility in the bond
market, the performance of certain mortgage-backed securities was strong. These
bonds offered yield advantages over other securities, with little offset due to
market volatility. We also purchased select corporate securities that enhanced
the portfolio's yield.
The portfolio's duration, at 4.3 years, remained slightly longer than our
neutral stance of 4.1 years. (Duration is a measure of a fund's price
sensitivity to interest rate changes. A longer duration indicates greater
sensitivity; a shorter duration indicates less.) Slightly extending the duration
enabled the portfolio to experience more price appreciation resulting from the
declining interest rate environment.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We plan to maintain the Fund's current asset allocation mix and investment
strategies, as we expect the U.S. economy to maintain its steady, albeit slower,
growth pattern over the next year. Of course, we will continue to monitor
valuation levels in the financial markets and
2
106
The One Group Asset Allocation Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
watch for signs of inflationary pressures. Any changes may warrant a shift in
our strategies.
With slower anticipated growth, inflation is likely to remain tame and interest
rates stable. Such an environment would not threaten the Fund's investments in
corporate bonds, which would become more vulnerable in a recession, or mortgage
securities, which would suffer if interest rates were to change dramatically. In
fact, we expect mortgage-backed, asset-backed and corporate securities to offer
return advantages over Treasuries in the coming months.
In the stock market, we expect corporate earnings to come under greater pressure
in the months ahead. As such, we look for more "normal" performance from the
stock market. We plan to maintain our sector neutrality, which gives us the
opportunity to take advantage of opportunities in various industries and
companies.
/s/ Daniel J. Kapusta
- ---------------------------
Daniel J. Kapusta
Fund Manager
/s/ Richard R. Jandrain III
- ---------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
/s/ Scott Grimshaw
- ---------------------------
Scott Grimshaw
Fund Manager
/s/ Gary J. Madich, CFA
- ---------------------------
Gary J. Madich, CFA
Senior Managing Director of Fixed Income Securities
* Holdings are subject to change.
Please refer to the prospectus and the accompanying financial statements for
more information about your Fund.
3
107
The One Group Asset Allocation Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (4/5/93)
Fiduciary 22.12% 14.11% 13.71%
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 500 S&P/Lipper Mix Fiduciary
4/93 $10,000 $10,000 $10,000
6/93 10,298 10,241 10,129
6/94 10,442 10,260 10,027
6/95 13,165 12,218 11,636
6/96 16,588 14,245 13,356
6/97 22,343 17,395 16,048
6/98 $29,082 $21,124 $19,596
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (4/2/93)
Class A 21.71% 13.82% 13.40%
Class A* 16.25% 12.78% 12.41%
* Reflects 4.50% Sales Charge
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 500 S&P/Lipper Mix Class A* Class A
4/93 $10,000 $10,000 $ 9,550 $10,000
6/93 10,298 10,241 9,668 10,124
6/94 10,442 10,260 9,553 10,003
6/95 13,165 12,218 11,057 11,580
6/96 16,588 14,245 12,657 13,257
6/97 22,343 17,395 15,166 15,888
6/98 $29,082 $21,124 $18,468 $19,336
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 20.95% 13.63%
Class B** 16.95% 13.34%
** Reflects Applicable Contingent Deferred Sales Charge
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 500 S&P/Lipper Mix Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/94 9,344 9,410 9,402 9,402
6/95 11,779 11,206 10,803 10,803
6/96 14,842 13,065 12,292 12,292
6/97 19,992 15,995 14,616 14,616
6/98 $26,022 $19,424 $17,476 $17,676
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Asset Allocation Fund is measured against the S&P 500
Index, an unmanaged index generally representative of the performance of large
companies in the US stock market. Investors are unable to purchase the index
directly, although they can invest in the underlying securities. The performance
of the index does not reflect the deduction of expenses associated with a mutual
fund, such as investment management. By contrast, the performance of the fund
reflects the deduction of these value-added services as well as the deduction of
sales charges on Class A Shares and applicable contingent deferred sales charges
on Class B Shares.
The S&P/Lipper Mix for all the classes is a blended index consisting of 60% of
the average monthly returns of the S&P 1500 Index from January 1, 1995 (index
inception date) until present and of the S&P 500 Index from April 1993 through
December 1994. The final 40% consists of the Lipper Intermediate US Government
Bond Funds Index.
4
108
The One Group Income Equity Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Income Equity Fund Fiduciary share class posted a total return of
23.18% for the year ended June 30, 1998. (For information on other share classes
and performance comparisons to the Fund's benchmark index, please see page 7.)
With inflation, unemployment and federal fiscal balances at their best levels in
a generation, the equity market offered strong double-digit returns for the
fourth consecutive year.
TO WHAT DO YOU ATTRIBUTE SUCH STRONG PERFORMANCE?
The Fund continued to benefit from its concentration in the types of companies
investors have preferred-large-capitalization, high-quality, consistent-growth
companies. At the same time, the Fund was rewarded for not owning companies with
severe earnings problems, such as those with significant exposure to Asia.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our portfolio strategies during the year focused on maintaining strong
performance measures while positioning the portfolio for a more challenging
market environment we think may be in store. As such, we sold and took profits
on certain issues that have been the best performers over the last several
years. We also eliminated some disappointing holdings and established new
positions in securities that we think are likely to be future market leaders.
We also have been improving the Fund's current income by reducing
lower-dividend-yielding issues and building positions in higher-yielding
securities. We also cut in half the Fund's position in convertible securities
and used the proceeds to invest in real estate investment trusts (REITs). In
addition to enhancing the Fund's diversification, we believe the REITs offer
good value and add important defensive characteristics to the Fund due to their
attractive yields.
On average, the Fund held 89% of its assets in common stocks, 5% in convertible
securities, 5% in REITs and 1% in cash during the year.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
The Fund enjoyed strong fiscal-year performance from several sectors in which
certain companies consistently achieved superior earnings growth or benefited
from major restructuring:
- - Health care (Schering-Plough, Pfizer and Warner-Lambert were up 65% or more)
- - Finance (American Express, Chase Manhattan, U.S. Bancorp, Lincoln National,
FNMA and National City were up 35% or more)
- - Telephone utilities (AT&T, BellSouth and Sprint were up 30% or more)
- - Selected industrials (Ford was up 55%).
WERE THERE ANY DISAPPOINTING HOLDINGS?*
Disappointing performers were concentrated in more volatile sectors, including
transportation (Union Pacific declined 37% for the fiscal year), energy and
mining (Amoco was off 4%, Cyprus-Amax down 46%) and manufacturing (Corning,
Boeing and Deere declined in price). Our policy in handling such "problem"
issues is to reduce the position size when earnings expectations are not being
met and sell out completely if a turnaround is unlikely, as we did with Union
Pacific and Cyprus-Amax. To help avoid problem situations, we concentrate on
favorable growth areas and look to fundamental research conducted by our
in-house analysts.
HOW DID THE FUND'S TOP 10 HOLDINGS CHANGE?*
Two new issues moved into the top 10 holdings-American Home Products, 2.1%
(health care) and Schering-Plough, 1.9% replaced Mobil (energy) and Philip
Morris (consumer non-durables). The remaining top 10 holdings were unchanged
from last year and included General Electric, 3.4% (capital goods), American
Express, 2.5%, Bristol-Myers Squibb, 2.4% (health care), Exxon, 2.2% (energy),
BankAmerica, 2.1% (financial services), Warner-Lambert, 2.1%, Coca-Cola, 2.1%
(consumer non-durable), and Royal Dutch Petroleum, 2.0% (energy).
5
109
The One Group Income Equity Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
WHAT IS YOUR OUTLOOK FOR THE FUND?
We are pleased with the current composition of the portfolio and the fundamental
progress of the companies the Fund owns. Nevertheless, the financial markets
have been highly volatile. Many of the uncertainties confronting investors
today-Asian problems, nuclear proliferation, historically high stock
valuations-have no quick-fix solutions. Furthermore, corporate earnings gains
aren't as good as they have been in recent years. This would suggest that we
should lower our return expectations and become more focused and selective.
Perhaps the best plan is to remain flexible and vigilant in order to take
advantage of opportunities when they arise. If a more challenging market
develops, we believe the Fund is well positioned, given its defensive
characteristics, higher-than-average income, holdings in predictable growth
companies and exposure to real estate.
/s/ R. Lynn Yturri
- ---------------------------
R. Lynn Yturri
Fund Manager
/s/ Richard R. Jandrain III
- ---------------------------
Richard R. Jandrain III
Senior Managing Director of Fixed Income Securities
* Holdings are subject to change.
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
6
110
The One Group Income Equity Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (7/2/87)
Fiduciary 23.18% 20.21% 16.29% 13.99%
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 500 Fiduciary
6/88 $10,000 $10,000
6/89 12,055 11,858
6/90 14,044 13,375
6/91 15,082 14,376
6/92 17,104 16,153
6/93 19,436 18,020
6/94 19,709 18,609
6/95 24,847 22,526
6/96 31,307 28,053
6/97 42,170 36,720
6/98 $54,889 $45,230
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 22.91% 19.89% 17.43%
Class A* 17.39% 18.79% 16.59%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 500 Class A* Class A
2/92 $10,000 $ 9,550 $10,000
6/92 9,992 9,625 10,079
6/93 11,354 10,721 11,226
6/94 11,514 11,037 11,557
6/95 14,515 13,301 13,961
6/96 18,289 16,569 17,353
6/97 24,635 21,602 22,625
6/98 $32,065 $26,558 $27,806
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 21.97% 20.06%
Class B** 17.97% 19.82%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 500 Class B** Class B
1/94 $10,000 $10,000 $10,000
6/94 9,344 9,663 9,663
6/95 11,779 11,587 11,587
6/96 14,842 14,300 14,300
6/97 19,992 18,515 18,515
6/98 $26,022 $22,387 $22,587
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 16.57%
Class C** 15.57%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 500 Class C** Class C
11/97 $10,000 $10,000 $10,000
6/98 $11,973 $11,556 $11,656
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Income Equity Fund is measured against the S&P 500 Index,
an unmanaged index generally representative of the performance of large
companies in the US stock market. Investors are unable to purchase the index
directly, although they can invest in the underlying securities. The performance
of the index does not reflect the deduction of expenses associated with a mutual
fund, such as investment management. By contrast, the performance of the fund
reflects the deduction of these value-added services as well as the deduction of
sales charges on Class A Shares and applicable contingent deferred sales charges
on Class B and Class C Shares.
7
111
The One Group Equity Index Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group Equity Index Fund Fiduciary
share class posted a total return of 29.73%. (For information on other share
classes and a performance comparison to the index, please see page 9.)
As it is designed to do, the Fund offered a return that nearly matched that of
the S&P 500 Index, the unmanaged group of stocks the Fund seeks to track with
little or no excess risk. The S&P 500 Index returned 30.16% for the year. The
slight difference in returns between the Fund and the Index is due to fees and
transaction costs charged to the Fund but not to the Index.
WHAT CONTRIBUTED TO SUCH A STRONG RETURN?
A strong economy, low inflation, declining interest rates and favorable
corporate earnings growth led to attractive stock market returns for yet another
year. Once again, large-capitalization growth companies, the type represented in
the S&P 500 Index, outperformed other types of U.S. stocks.
WHICH MARKET SECTORS OFFERED NOTABLE PERFORMANCE?
The Fund offered exposure to 15 market sectors. Among those sectors, retail and
telephone utilities offered the strongest performance. The retail sector
benefited from lower costs on Asian imports, while telephone utilities advanced
due to acquisition activity.
The weakest-performing sectors included technology, energy and industrial
commodities. The technology sector suffered somewhat from the economic and
market crisis that swept through Asia, while energy stocks declined due to lower
oil prices. In the industrial commodities sector (chemical, paper and metal
companies), stocks suffered from the sector's lack of pricing power.
WHAT WERE SOME OF THE STRONGEST AND WEAKEST STOCKS?*
The Fund enjoyed outstanding performance from a handful of stocks, including
technology provider Unisys, up 270% for the fiscal year due to strong earnings;
computer manufacturer Dell Computer, up 216% on strong earnings; cable
television company Tele-Communications, up 159% and acquired by AT&T; financial
service provider Providian Financial, up 145% on strong earnings; and auto
manufacturer Ford Motor, up 55% due to strong earnings.
Weak earnings contributed to poor performance from certain holdings, including
diversified mining company Freeport-McMoran Copper and Gold, down 51% for the
fiscal year; technology company Advanced Micro Devices, down 52%; and technology
provider Cabletron Systems, down 53%.
WHAT WERE THE FUND'S TOP 10 HOLDINGS?*
Most of the Fund's top 10 holdings retained their spots during the past year.
The only changes to the group were the addition of Pfizer, 1.5% (health care
sector) and Wal-Mart, 1.5% (retail), which replaced Philip Morris (consumer
non-durables) and IBM (technology). The remaining top 10 included General
Electric, 3.2% (capital goods), Microsoft, 2.9% (technology), Coca-Cola, 2.3%
(consumer non-durables), Exxon, 1.9% (energy), Merck, 1.7% (health care), Intel,
1.4% (technology), Proctor & Gamble, 1.3% (consumer non-durables) and Royal
Dutch Petroleum, 1.3% (energy).
WHAT IS YOUR OUTLOOK FOR THE STOCK MARKET?
The environment for stocks should remain favorable over the coming year. We
expect economic growth to continue, but at a slower pace. We also expect
interest rates and inflation to remain low. Corporate earnings and stock prices
should continue to grow, but earnings are likely to come under increasing
pressure. Nevertheless, it's important to remember that returns of the last few
years have been unusually strong, and they probably are not sustainable. We
expect to see stock returns revert to more "normal" levels.
/s/ Richard R. Jandrain III
- ---------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
* Holdings subject to change.
Please refer to the prospectus and the accompanying financial statements for
more information about your Fund.
The S&P 500 Index is an unmanaged group of stocks generally representative of
the performance of large U.S.-based companies. Investors cannot purchase the
index directly, but they can invest in the underlying securities.
8
112
The One Group Equity Index Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (7/2/91)
Fiduciary 29.73% 22.58% 19.64%
VALUE OF $10,000 INVESTMENT
Measurement Period Dollars
(Fiscal Year Covered) S&P 500 Fiduciary
7/91 $10,000 $10,000
6/92 10,836 11,211
6/93 12,313 12,673
6/94 12,486 12,753
6/95 15,741 16,043
6/96 19,834 20,129
6/97 26,717 27,033
6/98 $34,775 $35,070
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 29.33% 22.29% 19.44%
Class A* 23.49% 21.17% 18.58%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period Dollars
(Fiscal Year Covered) S&P 500 Class A* Class A
2/92 $10,000 $ 9,550 $10,000
6/92 9,992 9,595 9,992
6/93 11,354 10,818 11,354
6/94 11,514 10,879 11,514
6/95 14,515 13,644 14,515
6/96 18,289 17,075 18,289
6/97 24,635 22,869 24,635
6/98 $32,066 $29,574 $30,976
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 28.47% 22.74%
Class B** 24.47% 22.51%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period Dollars
(Fiscal Year Covered) S&P 500 Class B** Class B
1/94 $10,000 $10,000 $10,000
6/94 9,344 9,443 9,443
6/95 11,779 11,765 11,765
6/96 14,842 14,595 14,595
6/97 19,992 19,400 19,400
6/98 $26,022 $24,721 $24,921
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 21.07%
Class C** 20.07%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period Dollars
(Fiscal Year Covered) S&P 500 Class C** Class C
11/97 $10,000 $10,000 $10,000
6/98 $11,973 $12,006 412,106
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Equity Index Fund is measured against the S&P 500 Index,
an unmanaged index generally representative of the performance of large
companies in the US stock market. Investors are unable to purchase the index
directly, although they can invest in the underlying securities. The performance
of the index does not reflect the deduction of expenses associated with a mutual
fund, such as investment management. By contrast, the performance of the fund
reflects the deduction of these value-added services as well as the deduction of
sales charges on Class A Shares and applicable contingent deferred sales charges
on Class B and Class C Shares.
9
113
The One Group Value Growth Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Value Growth Fund Fiduciary share class posted a total return of
32.26% for the year ended June 30, 1998. (For information on other share classes
and performance comparisons to indexes, please see page 12.)
TO WHAT DO YOU ATTRIBUTE THE FUND'S SOLID RETURN?
Domestic stocks of all styles enjoyed another strong year, as low inflation,
declining interest rates and better-than-expected corporate earnings contributed
to the gains.
Rather than emphasizing particular market sectors or trying to time the market's
next moves, we research, evaluate and select stocks on an individual basis to
build a diversified portfolio. We don't consciously overweight a single sector
or a single style of stock. Instead, we invest in stocks from the four major
equity styles -- large capitalization growth, large capitalization value, medium
capitalization growth and medium capitalization value -- and look for stocks
that we believe offer the best return potential relative to their level of risk.
Over the past year, for example, we saw some vicious swings among sectors,
creating a momentum market that saw investors attempting to pick the "right"
sector at the right time. But, our emphasis on individual stock selection paid
off, as that process gave the Fund exposure to many different industries and
contributed to the Fund's strong return.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
The Fund owned more stocks than usual and was more diverse than usual in an
active attempt to be less exposed to any single momentum play. Momentum markets
tend to last longer than investors expect, and stocks that are not participating
tend to lose their value quickly.
Events in Asia played an interesting role in the Fund's performance. After the
domino effect, which started in Thailand, hit U.S. shores in October 1997, we
avoided the stocks of companies that we thought would be most negatively
affected by the malaise -- namely, commodity cyclical companies. By steering
away from that group, the Fund became more growth-oriented than usual.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
Industry positions such as the pharmaceutical area of health care
(Schering-Plough, up 91% for the fiscal year, and Bristol-Myers Squibb, up 42%);
the software and PC areas of technology (Microsoft, up 71%; BMC Software, up
88%; Dell Computer, up 216%); and the long distance segment of
telecommunications (Century Telephone, up 104%; Sprint, up 35%) added to the
Fund's strong performance.
The Fund also benefited from strong performance from Cisco Systems (technology),
up 106% for the year; Equitable Co. (financial services), up 125%; Morgan
Stanley Dean Witter (financial services), up 112%; Lucent Technologies
(technology), up 131%; and Energy East (utility), up 99%.
At the same time, a few Fund holdings realized poor performance, namely Callaway
Golf (consumer services), down 45% for the year; Toys R Us (retail), down 33%;
BetzDearborn (raw materials), down 37%; Columbia/HCA Healthcare (health care),
down 26%; and Phycor (health care), down 52%.
HOW DID THE FUND'S TOP 10 HOLDINGS CHANGE?*
More than half of the Fund's top 10 holdings were among the leading holdings one
year ago: Microsoft, 3.3% (technology), General Electric, 2.9% (capital goods),
Exxon, 2.1% (energy), Wal-Mart, 1.8% (retail), Bristol Myers, 1.8% (health care)
and Intel, 1.7% (technology). The remaining members of the top 10 on June 30,
1998, included NationsBank, 1.8% (financial services), Cisco Systems, 1.8%, Dell
Computer, 1.7% and Coca-Cola, 1.5% (consumer non-durables).
10
114
The One Group Value Growth Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
WHAT IS YOUR OUTLOOK FOR THE FUND?
We anticipate corporate earnings to revert to more normal levels, and we believe
volatility will continue. We plan to maintain the Fund's style diversity in
similar proportion as last year to address this market.
/s/ Michael D. Weiner
- ---------------------
Michael D. Weiner
Fund Manager
/s/ Richard R. Jandrain III
- ---------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
* Holdings are subject to change.
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
11
115
The One Group Value Growth Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (12/29/89)
Fiduciary 32.26% 19.63% 17.91%
Measurement Period VALUE OF $10,000 INVESTMENT
(Fiscal Year Covered) S&P 1500 Fiduciary
12/89 $10,000 $10,000
6/90 10,309 10,657
6/91 11,072 11,631
6/92 12,557 13,847
6/93 14,268 16,554
6/94 14,469 16,496
6/95 18,241 19,198
6/96 22,959 23,242
6/97 30,524 30,673
6/98 $39,510 $40,584
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (12/29/89)
Class A 31.96% 19.48% 17.82%
Class A* 26.04% 18.38% 17.19%
* Reflects 4.50% Sales Charge.
Measurement Period VALUE OF $10,000 INVESTMENT
(Fiscal Year Covered) S&P 1500 Class A* Class A
12/89 $10,000 $ 9,550 $10,000
6/90 10,309 10,178 10,657
6/91 11,072 11,107 11,631
6/92 12,557 13,224 13,847
6/93 14,268 15,809 16,554
6/94 14,469 15,754 16,496
6/95 18,241 18,334 19,198
6/96 22,959 22,178 23,225
6/97 30,524 29,171 30,548
6/98 $39,510 $38,504 $40,326
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (9/9/94)
Class B 30.89% 23.28%
Class B** 26.89% 22.84%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period VALUE OF $10,000 INVESTMENT
(Fiscal Year Covered) S&P 1500 Class B** Class B
9/94 $10,000 $10,000 $10,000
6/95 12,019 10,806 10,806
6/96 15,129 12,981 12,981
6/97 20,113 16,942 16,942
6/98 $26,034 $21,873 $22,173
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 20.87%
Class C** 19.87%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period VALUE OF $10,000 INVESTMENT
(Fiscal Year Covered) S&P 1500 Class C** Class C
11/97 $10,000 $10,000 $10,000
6/98 $11,858 $11,987 $12,087
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The above-quoted performance data includes the performance of the Paragon Value
Equity Income Fund for the period prior to the commencement of operations of The
One Group Value Growth Fund on March 26, 1996. Performance for the Fiduciary
Shares is based on Class A Share performance adjusted to reflect the absence of
sales charges.
The performance of the Value Growth Fund is measured against the S&P 1500 Index,
an unmanaged index generally representative of the performance of large and
small companies in the US stock market. Investors are unable to purchase the
index directly, although they can invest in the underlying securities. The
performance of the index does not reflect the deduction of expenses associated
with a mutual fund, such as investment management. By contrast, the performance
of the fund reflects the deduction of these value-added services as well as the
deduction of sales charges on Class A Shares and applicable contingent deferred
sales charges on Class B and Class C Shares.
The S&P 1500 Index for all classes consists of the average monthly returns of
the S&P 500 Index from December 1989 through December 1994. Thereafter, the data
are from the S&P 1500 Index which corresponds with the initiation of the S&P
1500 Index on January 1, 1995.
12
116
The One Group Large Company Value Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group Large Company Value Fund
Fiduciary share class posted a total return of 21.46%. (For information on other
share classes and a performance comparison to the index, please see page 15.)
TO WHAT DO YOU ATTRIBUTE THE FUND'S SOLID RETURN?
A positive economic environment led to strong corporate earnings growth, which
benefited stocks in the Fund. Likewise, low inflation and a favorable interest
rate environment boosted stock values.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our strategy involves implementing traditional value-investing techniques,
including focusing on stocks with below-average price-to-earnings and
price-to-book ratios. We employ this approach within the context of our basic
research discipline -- investing in attractively priced stocks with improving
fundamentals. Our goal is to realize price appreciation within a reasonable time
horizon.
We slightly modified the Fund's sector weightings during the year, increasing
exposure to electric utilities so that the sector is now a bit overweighted. We
believe the industry is well into its deregulation cycle, and we expect returns
to become even more compelling. This should result in further buying interest
going forward. We also made some minor changes in the technology sector, where
computer giant IBM is now the sector's largest holding.
DID EVENTS OVERSEAS INFLUENCE FUND RETURNS?
While the companies in which the Fund invests do not have tremendous exposure to
Europe, the stronger economies in that region did have an overall positive
impact on the Fund. On the other hand, weak Asian demand hurt companies with
significant Asian sales, especially in the capital goods sector. Fortunately,
the Fund was only slightly affected, as just 5% of its holdings had exposure to
Asia.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
The Fund was invested primarily in energy, banking, financial and telephone
stocks during the year. The banking and financial stocks were the best
performers due to continued consolidation in their industries. In fact, the Fund
enjoyed fiscal-year gains of at least 20% from the following financial services
companies: Travelers Group, Morgan Stanley Dean Witter, Lincoln National,
Hartford Financial Services Group and Fannie Mae.
Acquisition targets also proved to be among the best performing Fund holdings.
Auto maker Chrysler saw its stock price advance 71% over the year, primarily due
to its merger with German car maker Daimler Benz. In the telephone industry, MCI
Communications' pending acquisition by WorldCom pushed shares of MCI 52% higher
for the year. And, in the raw materials sector, Alcoa's acquisition of Alumax
helped shares of Alumax advance 22%.
On the other hand, energy stocks lagged as weak oil prices hurt earnings.
Because of this, we decreased the Fund's exposure to the major oil companies and
increased exposure to the natural gas pipeline and refining companies. The
refining companies are expected to benefit from lower oil prices.
HOW DID THE FUND'S TOP 10 HOLDINGS CHANGE?*
More than half of the Fund's top 10 holdings remained unchanged during the year.
Those that held their spots from the previous year included Exxon, 4.3%
(energy), IBM, 4.2%, NationsBank, 2.8% (financial services), Travelers Group,
2.8%, Royal Dutch Petroleum, 2.7% (energy) and BankAmerica, 2.1% (financial
services). New to the group were Chrysler, 2.1%, Allstate, 1.9% (financial
services), Sears Roebuck & Co., 1.9% (retail) and Citicorp, 1.8% (financial
services).
13
117
The One Group Large Company Value Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
WHAT IS YOUR OUTLOOK FOR THE FUND?
Our outlook for the economy suggests a favorable environment for stocks over the
coming year. We expect modest, but slower, economic growth with interest rates
and inflation remaining under control. As such, we expect corporate earnings and
stock prices to continue to grow. But, we expect to see stock returns revert to
more "normal" levels, compared to the unusually high results of the past few
years.
/s/ Edmund M. Cowart
- --------------------
Edmund M. Cowart
Managing Director, Value Growth Team
/s/ Richard R. Jandrain III
- ---------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
* Holdings are subject to change.
Please refer to the prospectus and the accompanying financial statements for
more information about your Fund.
14
118
The One Group Large Company Value Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (3/1/91)
Fiduciary 21.46% 16.88% 14.68%
Fiduciary
VALUE OF $10,000 INVESTMENT
Measurement Period S&P/BARRA
(Fiscal Year Covered) 500 Value Fiduciary
3/91 $10,000 $10,000
6/91 10,035 10,148
6/92 11,405 11,721
6/93 13,514 12,511
6/94 13,932 12,709
6/95 16,903 15,685
6/96 21,094 17,678
6/97 27,610 22,470
6/98 $34,546 $27,292
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 21.14% 16.66% 14.00%
Class A* 15.69% 15.59% 13.17%
Class A
Class A*
* Reflects 4.50% Sales Charge
VALUE OF $10,000 INVESTMENT
Measurement Period S&P/BARRA
(Fiscal Year Covered) 500 Value Class A* Class A
2/92 $10,000 $ 9,550 $10,000
6/92 10,267 9,539 9,988
6/93 12,165 10,173 10,652
6/94 12,542 10,370 10,862
6/95 15,217 12,716 13,321
6/96 18,990 14,292 14,973
6/97 24,856 18,137 19,000
6/98 $31,100 $21,976 $23,018
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 20.18% 16.80%
Class B** 16.18% 16.54%
** Reflects Applicable Contingent Deferred Sales Charge
VALUE OF $10,000 INVESTMENT
Measurement Period S&P/BARRA
(Fiscal Year Covered) 500 Value Class B** Class B
1/94 $10,000 $10,000 $10,000
6/94 9,643 9,652 9,652
6/95 11,317 11,802 11,802
6/96 14,123 13,213 13,213
6/97 18,485 16,630 16,630
6/98 $23,128 $19,783 $19,983
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Large Company Value Fund is measured against the
S&P/BARRA 500 Value Index, an unmanaged index representing the performance of
the lowest price to book securities in the S&P 500. Investors are unable to
purchase the index directly, although they can invest in the underlying
securities. The performance of the index does not reflect the deduction of
expenses associated with a mutual fund, such as investment management. By
contrast, the performance of the fund reflects the deduction of these
value-added services as well as the deduction of sales charges on Class A Shares
and applicable contingent deferred sales charges on Class B Shares.
15
119
The One Group Disciplined Value Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Disciplined Value Fund Fiduciary share class posted a total return
of 28.27% for the year ended June 30, 1998. (For information on other share
classes and performance comparisons to the index, please see page 18.)
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Interest rates ended the year lower, but experienced volatility throughout the
12-month period. To avoid some of the stock price volatility associated with
interest rate swings, we maintained a diversified portfolio with exposure to a
variety of economic sectors. Within this framework, we emphasized in-depth
analysis and individual stock selection, and we continued to rebalance the
portfolio in order to improve structure and upgrade holdings as market
conditions changed.
Because of the Fund's value orientation, we emphasized the sectors that offered
the greatest perceived value. As a result, almost half of the Fund's assets were
in the electric utility, financial, industrial, commodity and banking sectors.
These were the areas that contained the largest number of equity securities with
below-market-average price-to-earnings and price-to-book ratios.
Given the continued strength of the market, certain stocks reached their target
prices quicker than we had anticipated, prompting the sale of those securities
and the purchase of new ones. In addition, as certain stocks increased in
valuation, they became more growth-like and were no longer appropriate for this
value-oriented fund. For example, in the second half of 1997 prices on bank
stocks soared, and the resulting valuations converted many of these stocks to
growth stocks. As a result, remaining sectors that were relatively undervalued
became more influential, and their weightings within the Fund increased.
Specifically, we increased the Fund's holdings within the capital equipment,
financial, industrial commodity and consumer durable sectors to make up for the
gap caused by the decline in bank holdings.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
Outstanding performance from several individual stocks during the fiscal year
was driven largely by takeovers. For example, in the technology sector Qwest
Communications acquired LCI International, in which the Fund had a large
exposure; National City Bank acquired First of America, a Fund holding; and
Williams Companies acquired the energy company Mapco, another Fund holding. In
addition, the Fund's holding of Century Telephone nearly doubled in value over
the year, as analysts projected superior earnings growth for the combined
Century Telephone/Pacific Telesis company. Indeed, the merged company
experienced revenue growth and margin expansion after joining forces, as it cut
costs and expanded its territory.
Another merger, between cement manufacturers Southdown and Medusa, also
contributed to the Fund's solid return. But, price gains on these stocks
primarily were driven by excellent fundamentals within the industry. The
supply/demand equation favored the manufacturers, given the steadily increasing
demand for cement from the housing and infrastructure sectors, while the supply
of cement has been virtually unchanged in the last decade. In addition, U.S.
government restrictions on the amount of cement that can be imported helped the
U.S. manufacturers.
DID EVENTS IN ASIA INFLUENCE ANY OF THE FUND'S HOLDINGS?*
On the downside, events in Asia caused certain Fund holdings to decline. As
Asian currency values plummeted, it appears Asian customers chose to curtail
their gaming excursions to the United States. As a result, the Fund's holdings
in Circus Circus and MGM declined for the fiscal year. In addition, CompUSA lost
half of its value due to the unanticipated sharp declines in computer prices.
Lower demand from Asia contributed to the price declines, as did the lack of new
memory-consuming software applications, which prompted revenue declines and
margin contraction.
HOW DID THE FUND'S TOP 10 HOLDINGS CHANGE DURING THE FISCAL YEAR?*
Only two of the Fund's top 10 holdings remained from last year -- CMS Energy,
1.6% (utilities) and Southtrust Corp., 1.6% (financial services). Rounding out
the top 10 were utilities companies New Century Enterprises, 1.5%, Allegheny
Energy, 1.3%, Century Telephone, 1.5%, El Paso Natural Gas, 1.6% and Teco
Energy, 1.2%; financial companies Bear Stearns,
16
120
The One Group Disciplined Value Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
1.6% and Paine Webber, 1.2%; and Tyson Foods, 1.1%, a member of the consumer
non-durable sector.
WHAT IS YOUR OUTLOOK FOR THE FUND?
Looking ahead, we plan to maintain our current strategy of broad sector
diversification, stringent in-house research and individual stock selection.
Within each sector, we will continue to look for the best values among medium
capitalization stocks, or those issues with low price/earnings and price/book
ratios.
/s/ Edmund M. Cowart
- --------------------
Edmund M. Cowart
Managing Director, Value Growth Team
/s/ Richard R. Jandrain III
- ---------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
* Holdings subject to change.
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
17
121
The One Group Disciplined Value Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Dollars
Since
Inception
1 Year 5 Year (3/2/89)
Fiduciary 28.27% 17.52 14.11%
Fiduciary
VALUE OF $10,000 INVESTMENT Dollars
S&P
Measurement Period BARRA/Midcap
(Fiscal Year Covered) 400/Value Fiduciary
3/89 10,000 10,000
6/89 10,883 10,989
6/90 12,677 11,372
6/91 13,615 11,572
6/92 15,441 13,451
6/93 17,545 15,278
6/94 17,792 15,895
6/95 22,430 18,443
6/96 27,627 22,150
6/97 34,233 26,704
6/98 43,366 34,253
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Dollars
Since
Inception
1 Year 5 Year (2/18/92)
Class A 27.90% 17.27% 15.79%
Class A* 22.13% 16.19% 14.96%
Class A
Class A*
* Reflects 4.50% Sales Charge
VALUE OF $10,000 INVESTMENT
S&P
Measurement Period BARRA/Midcap
(Fiscal Year Covered) 400/Value Class A* Class A
2/92 10,000 9,550 10,000
6/92 9,992 9,666 10,121
6/93 11,354 10,948 11,464
6/94 11,514 11,418 11,956
6/95 14,515 13,179 13,801
6/96 17,879 15,788 16,534
6/97 22,153 18,977 19,875
6/98 28,063 24,279 25,419
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Dollars
Since
Inception
1 Year (1/14/94)
Class B 26.97% 16.38%
Class B** 22.97% 16.12%
** Reflects Applicable Contingent Deferred Sales Charge
VALUE OF $10,000 INVESTMENT
Measurement Period S&P
(Fiscal Year Covered) BARRA/Midcap Class B** Class B
1/94 10,000 10,000 10,000
6/94 9,344 9,500 9,500
6/95 11,779 10,918 10,918
6/96 14,509 12,985 12,985
6/97 17,978 15,476 15,476
6/98 22,775 19,465 19,665
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Disciplined Value Fund is measured against the S&P/BARRA
Midcap 400 Value Index, an unmanaged index representing the performance of the
lowest price to book securities in the S&P Midcap 400 Index. Investors are
unable to purchase the index directly, although they can invest in the
underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The S&P/BARRA Midcap 400 Value Index consists of the average monthly returns of
the S&P 500 Index for periods prior to June 1991. Thereafter, the data are from
the S&P/BARRA Midcap 400 Value Index which corresponds with the initiation of
the S&P/BARRA Midcap 400 Value Index on June 30, 1991.
18
122
The One Group Large Company Growth Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Large Company Growth Fund Fiduciary share class posted a total
return of 35.75% for the year ended June 30, 1998. (For information on other
share classes and performance comparisons to indexes, please see page 20.)
TO WHAT DO YOU ATTRIBUTE THE FUND'S SOLID RETURN?
A strong domestic economy, low inflation and declining interest rates all worked
together to maintain a favorable equity environment. Once again, the market
favored the largest growth-oriented companies because of their earnings
reliability and stock liquidity.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our primary investment strategy during this market climate has been to find good
companies within industries that are growing at a faster rate than the economy.
These are companies that we believe have the ability to exhibit sustained growth
at some multiple of their underlying industry growth rate. In addition, we
search for strong management teams and superior product positioning.
After evaluating the impact of the Asian crisis on the Fund's stocks, we cut the
portfolio's technology holdings because much of these companies' exports went to
Asia. We also increased our retail holdings, as many of these companies purchase
their materials from Asia and thus benefit from lower costs.
This strategy worked well, because the technology sector, as a whole, has
underperformed the market, while the retail sector has outperformed.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
The Fund enjoyed outstanding performance from computer manufacturer Dell
Computer, up 216% for the fiscal year; software giant Microsoft, up 71% and
online service provider America Online, up 278%.
On the other hand, there were a few disappointing performances from the
technology sector. For example, Applied Materials was off 17% and Oracle Corp.
declined 27%.
HOW DID THE FUND'S TOP 10 HOLDINGS CHANGE?*
Most of the Fund's top 10 holdings remained unchanged during the year. The only
newcomers were Dell Computer, 2.6% (technology) and Lucent Technologies, 2.3%
(technology). The remaining members included General Electric, 6.8% (capital
goods), Microsoft, 6.4% (technology), Coca-Cola, 4.3% (consumer non-durable),
Wal-Mart, 3.2% (retail), Merck, 3.0% (health care), Bristol-Myers Squibb, 3.0%
(health care), Pfizer, 2.9% (health care) and Proctor & Gamble, 2.6% (consumer
non-durable).
WHAT IS YOUR OUTLOOK FOR THE FUND?
Looking ahead, we remain optimistic about continued U.S. economic growth and low
inflation. We believe that interest rates may continue to decline, which would
support ongoing stock market growth, but perhaps not at the unusually strong
pace we've seen over the last several years. As such, it seems prudent to lower
our expectations somewhat for the next year.
Our overall strategy remains intact -- to search for companies with strong
fundamentals, effective management teams and favorable long-term outlooks.
Because the Asian situation remains unresolved, we will continue to monitor its
effects on the Fund's holdings.
/s/ Ashi Parikh
Ashi Parikh
Managing Director, Growth Equity Team
/s/ Richard R. Jandrain III
Richard R. Jandrain III
Senior Managing Director of Equity Securities
* Holdings are subject to change.
Please refer to the prospectus and the accompanying financial statements for
more information about your fund.
19
123
The One Group Large Company Growth Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
VALUE OF $10,000 INVESTMENT DOLLARS
Since
Inception
1 Year 5 Year (2/28/92)
Fiduciary 35.75% 22.79% 19.88%
Fiduciary
Measurement Period S&P/BARRA
(Fiscal Year Covered) 500 Growth Fiduciary
2/92 10,000 10,000
6/92 9,743 9,920
6/93 10,550 11,301
6/94 10,522 12,210
6/95 13,755 14,878
6/96 17,505 17,461
6/97 24,215 23,243
6/98 32,661 31,553
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
VALUE OF $10,000 INVESTMENT DOLLARS
Since
Inception
1 Year (2/22/94)
Class A 35.43% 23.70%
Class A* 29.33% 22.39%
* Reflects 4.50% Sales Charge.
Measurement Period S&P/BARRA
(Fiscal Year Covered) 500 Growth Class A* Class A
2/94 10,000 9,550 10,000
6/94 9,530 9,453 9,898
6/95 12,458 11,486 12,028
6/96 15,854 13,420 14,054
6/97 21,931 17,790 18,631
6/98 29,581 24,085 25,230
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
VALUE OF $10,000 INVESTMENT DOLLARS
Since
Inception
1 Year (1/14/94)
Class B 34.39% 22.49%
Class B** 30.39% 22.26%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period S&P/BARRA
(Fiscal Year Covered) 500 Growth Class B** Class B
1/94 10,000 10,000 10,000
6/94 9,539 9,934 9,934
6/95 12,235 11,831 11,831
6/96 15,570 13,952 13,952
6/97 21,539 18,381 18,381
6/98 29,052 24,496 24,696
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
DOLLARS
Since
Inception
(11/4/97)
Class C 27.63%
Class C** 26.63%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period S&P/BARRA
(Fiscal Year Covered) 500 Growth Class C** Class C
11/97 10,000 10,000 10,000
6/98 12,458 12,663 12,763
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Large Company Growth Fund is measured against the
S&P/BARRA 500 Growth Index, an unmanaged index representing the performance of
the highest price to book securities in the S&P 500. Investors are unable to
purchase the index directly, although they can invest in the underlying
securities. The performance of the index does not reflect the deduction of
expenses associated with a mutual fund, such as investment management. By
contrast, the performance of the fund reflects the deduction of these
value-added services as well as the deduction of sales charges on Class A Shares
and applicable contingent deferred sales charges on Class B and Class C Shares.
20
124
The One Group Growth Opportunities Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Growth Opportunities Fund Fiduciary share class posted a total
return of 31.11% for the year ended June 30, 1998. (For information on other
share classes and performance comparisons to indexes, please see page 22.)
TO WHAT DO YOU ATTRIBUTE THE FUND'S SOLID RETURN?
Medium-capitalization growth stocks continued to benefit from a strong economy,
solid corporate earnings, low inflation and low interest rates. In addition to
these factors, the Fund's performance has benefited from good stock selection.
Instead of looking for stocks based on general economic or market trends, we
evaluate stocks on an individual basis, searching for those with appealing
fundamentals.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our primary investment strategy is to identify high growth companies within
attractive, fast-growing industries. We look for companies that will benefit
from strong management teams and competitive advantages. These factors should
allow sustained high growth at a rate that outpaces the industry average.
After the Asian crisis erupted, we evaluated the impact of the fallout. Many of
the Fund's technology companies had significant Asian exports, so we cut certain
technology holdings to lessen the impact that decreased Asian demand would have
on these companies. At the same time, we increased our retail holdings because
many of these companies purchase materials from Asia. As such, these retailers
were able to benefit from lower prices on Asian imports.
This strategy worked well, because the technology sector, as a whole,
underperformed the market, while the retail sector outperformed.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
The Fund enjoyed outstanding performance from computer manufacturer Dell
Computer, up 216% for the fiscal year; retailer Just for Feet, up 63% and
technology company Compuware, up 114%.
On the other hand, there were a few disappointing performances from Altera
(technology), down 42% for the fiscal year; KLA-Tencor (technology), down 43%;
and Global Marine (energy), down 19%.
HOW DID THE FUND'S TOP 10 HOLDINGS CHANGE?*
Half of the Fund's top 10 holdings changed during the year. At year-end, those
that remained in the top 10 included Coca-Cola Enterprises, 3.0% (consumer non-
durable), BMC Software, 2.2% (technology), Just for Feet, 2.0% (retail), AES
Corp., 1.9% (utilities) and AFLAC, 1.6% (financial services). The new members
included America Online, 4.4% (technology), USA Waste Services, 2.5% (capital
equipment), Compuware, 2.0% (technology), Kohl's, 1.6% (retail) and Staples,
1.6% (retail).
WHAT IS YOUR OUTLOOK FOR THE FUND?
Looking ahead, we remain optimistic about continued U.S. economic growth and low
inflation. We believe that interest rates may continue to decline, which would
support ongoing stock market growth, but perhaps not at the unusually strong
pace we've seen over the last several years. As such, it seems prudent to lower
our expectations somewhat for the next year.
Our overall strategy remains intact -- to search for companies with strong
fundamentals, effective management teams and favorable long-term growth rates.
Because the Asian situation remains unresolved, we will continue to monitor its
effects on the Fund's holdings.
/s/ Ashi Parikh
- -------------------------------------
Ashi Parikh
Managing Director, Growth Equity Team
/s/ Richard R. Jandrain III
- -------------------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
* Holdings are subject to change.
Please refer to the prospectus and the accompanying financial statements for
more information about your fund.
21
125
The One Group Growth Opportunities Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (3/2/89)
Fiduciary 31.11% 19.12% 18.35%
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) Mix Fiduciary
3/89 $10,000 $10,000
6/89 10,883 10,822
6/90 12,677 13,077
6/91 13,165 14,364
6/92 15,441 16,543
6/93 17,545 20,076
6/94 17,792 20,044
6/95 22,430 24,002
6/96 28,311 29,915
6/97 34,939 36,721
6/98 $44,334 $48,146
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 30.95% 18.85% 15.87%
Class A* 25.07% 17.76% 15.03%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) Mix Class A* Class A
2/92 $10,000 $ 9,550 $10,000
6/92 9,992 8,448 8,847
6/93 11,354 10,282 10,766
6/94 11,514 10,229 10,710
6/95 14,515 12,224 12,799
6/96 18,321 15,196 15,912
6/97 22,611 18,618 19,495
6/98 $28,691 $24,380 $25,528
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 29.79% 18.09%
Class B** 25.79% 17.84%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P Mix Class B** Class B
1/94 $10,000 $10,000 $10,000
6/94 9,344 9,093 9,093
6/95 11,779 10,772 10,772
6/96 14,868 13,307 13,307
6/97 18,349 16,198 16,198
6/98 $23,283 $20,783 $20,983
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 14.27%
Class C** 13.27%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P Mix Class C** Class C
11/97 $10,000 $10,000 $10,000
6/98 $11,373 $11,327 $11,427
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Growth Opportunities Fund is measured against the
S&P/BARRA Midcap 400 Growth Index, an unmanaged index representing the
performance of the highest price to book securities in the S&P Midcap 400 Index.
Investors are unable to purchase the index directly, although they can invest in
the underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B and Class C
Shares.
The S&P/BARRA Midcap 400 Growth Index for the Fiduciary Class Shares consists of
the average monthly returns of the Russell 2000 Index for periods prior to June,
1991. Thereafter, the data are from the S&P/BARRA Midcap 400 Growth Index which
corresponds with the initiation of the S&P/BARRA Midcap 400 Growth Index on June
30, 1991.
22
126
The One Group Small Capitalization Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group Small Capitalization Fund
Fiduciary share class posted a total return of 23.58%. (For information on other
share classes and a performance comparison to the index, please see page 24.)
For the fourth year in a row, performance of small-capitalization stocks trailed
that of large-capitalization stocks. Investors continued to favor larger-company
stocks because of their liquidity traits and earnings predictability.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our primary strategies during the year were to maintain an average market
capitalization of $500 million or less and enhance the portfolio's
diversification. We started improving the Fund's diversification in November
1997, after shareholders approved a change in the Fund's investment objective.
Previously, the Fund focused on companies based in the Southeast region of the
United States. Now, the Fund invests primarily in small and emerging companies
throughout the United States, seeking to offer growth opportunities from a much
larger universe of companies. The number of companies represented in the
portfolio increased by 40% during the year.
We select stocks on an individual basis, relying on in-depth research to uncover
companies with talented management teams and promising growth characteristics.
As such, we avoid emphasizing particular sectors or industries and, instead,
tend to remain sector neutral.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG HOLDINGS?*
The Fund benefited from impressive performance from several individual holdings.
In particular, furniture retailer Ethan Allen Interiors was up more than 75% for
the year, after doubling in value the previous fiscal year. Safeskin Corp., in
the health care sector, was up more than 179% for the year.
WERE THERE ANY PARTICULARLY WEAK HOLDINGS?*
We significantly reduced the Fund's energy weighting during the year, as oil
prices declined. Nevertheless, several of the Fund's holdings in oil service
companies, which had performed extremely well in fiscal 1997, declined nearly
50% from their highs. In addition, several stocks in the volatile health care
and technology sectors dropped in value.
HOW DID THE FUND'S TOP 10 HOLDINGS CHANGE?*
The Fund's top 10 holdings were led by five technology stocks -- Sanmina, 1.2%,
Tech Data, 1.0%, Platinum Technology, 0.9%, Aspect Telecommunications, 0.8%, and
Comverse Technology, 0.8% -- and three financial stocks -- Protective Life,
1.2%, Sirrom Capital, 0.9% and Alabama National Bancorp, 0.9%. The remaining
members of the top 10 were Ethan Allen Interiors, 1.0% and Hibbett Sporting
Goods, 0.8% (retail).
WHAT IS YOUR OUTLOOK FOR THE FUND?
Looking ahead, we remain optimistic about continued U.S. economic growth and low
inflation. We believe that interest rates may decline further, which would
support ongoing stock market growth. Although the market continues to demand
liquidity, which is provided by large-capitalization stocks, the valuations in
small-company stocks are becoming more compelling on a price/earnings to growth
relationship.
Our overall strategy remains intact -- to take a bottom-up approach in our
search for small companies with promising growth qualities.
/s/ Donald E. Allred
- ---------------------------
Donald E. Allred
Fund Manager
/s/ Richard R. Jandrain III
- ---------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
* Holdings are subject to change.
Please refer to the prospectus and the accompanying financial statements for
more information about your Fund.
23
127
The One Group Small Capitalization Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (7/1/91)
Fiduciary 23.58% 14.55% 17.10%
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 600 Fiduciary
6/91 $10,000 $10,000
6/92 11,710 12,122
6/93 15,046 15,309
6/94 15,326 15,874
6/95 18,447 17,772
6/96 23,246 21,551
6/97 28,287 24,448
6/98 $33,792 $30,200
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (7/1/91)
Class A 23.28% 14.42% 17.01%
Class A* 17.69% 13.37% 16.25%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 600 Class A* Class A
6/91 $10,000 $ 9,550 $10,000
6/92 11,710 11,577 12,122
6/93 15,046 14,620 15,309
6/94 15,326 15,159 15,877
6/95 18,447 16,972 17,772
6/96 23,246 20,502 21,468
6/97 28,287 23,275 24,371
6/98 $33,792 $28,683 $30,034
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (9/12/94)
Class B 22.24% 15.88%
Class B** 18.24% 15.35%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 600 Class B** Class B
9/94 $10,000 $10,000 $10,000
6/95 11,188 10,594 10,594
6/96 14,098 12,702 12,702
6/97 17,156 14,320 14,320
6/98 $20,494 $17,199 $17,499
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 3.08%
Class C** 2.16%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period
(Fiscal Year Covered) S&P 600 Class C** Class C
11/97 $10,000 $10,000 $10,000
6/98 $10,826 $10,215 $10,307
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The above-quoted performance data includes the performance of the Paragon Gulf
South Growth Fund for the period prior to the commencement of operations of The
One Group Small Capitalization Fund on March 26, 1996. Performance for the
Fiduciary Shares is based on Class A Share performance adjusted to reflect the
absence of sales charges.
The performance of the Small Capitalization Fund is measured against the S&P 600
Index, an unmanaged index generally representative of the performance of small
companies in the US stock market. Investors are unable to purchase the index
directly, although they can invest in the underlying securities. The performance
of the index does not reflect the deduction of expenses associated with a mutual
fund, such as investment management. By contrast, the performance of the fund
reflects the deduction of these value-added services as well as the deduction of
sales charges on Class A Shares and applicable contingent deferred sales charges
on Class B and Class C Shares.
24
128
The One Group International Equity Index Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group International Equity Index Fund
Fiduciary share class provided a total return of 9.54%. (For information on
other share classes and a performance comparison to the index, please see page
27.)
TO WHAT DO YOU ATTRIBUTE THE FUND'S PERFORMANCE?
The Fund's strategy has two components. It seeks to invest 90% of its assets in
the developed international markets in a manner designed to track the Morgan
Stanley Capital International Europe, Australia, Far East/
Gross Domestic Product (EAFE/GDP) Index; and it invests the remaining 10% of its
assets in emerging markets.
Over the past 12 months, the difference in return between the developed markets
and the emerging markets was dramatic. The EAFE/GDP Index rose 15.14% over this
period, while the customized index we track in the emerging markets fell 16.09%.
The Fund's return trailed the EAFE/GDP Index due to its investments in emerging
markets and due to fees and expenses charged to the Fund. (An index has no
expenses because it is an unmanaged portfolio.)
WHY DID THE EMERGING MARKETS FALL SO SHARPLY?
The turmoil in the emerging markets began on July 2, 1997, when a rapid decline
in Thailand's currency precipitated an economic crisis throughout Asia. As the
region's currencies dropped, companies' foreign debts grew beyond their ability
to pay. Many companies had borrowed from foreign lenders because interest rates
were lower in those countries than they were at home. The amount of foreign debt
surprised most investors, as companies in these countries did not adequately
disclose those loans. Investors' reacted to these developments and equity prices
plunged along with the currencies.
WHAT ABOUT THE INFLUENCE FROM THE DEVELOPED MARKETS?
European equity markets performed very well this past year, which allowed the
Fund to achieve its positive return in spite of the turmoil in the Asian
markets. The Fund's investments in Europe started the year at more than 61% of
total assets.
HOW DID THE U.S. DOLLAR'S STRENGTH INFLUENCE RETURNS?
Overall performance once again was held back by a strong U.S. dollar, which
increased in value versus nearly every currency across the globe. Because the
Fund's foreign-denominated investments suffered from currency declines in all
the countries where it invests over the past year, the strong U.S. dollar
prevented the Fund from achieving a higher return.
DID THE PORTFOLIO BENEFIT FROM ANY PARTICULARLY STRONG MARKETS?
Equity market returns across Europe outpaced even the exceptional U.S. equity
market during the past 12 months. Among the developed countries, Finland
performed best, up 66%. Other outstanding returns were posted in Italy, up 63%;
Spain, up 50%; Ireland, up 41%; and Austria, France and Germany, each up more
than 30%. European emerging countries also performed well, with Greece up 37%,
Hungary up 25%, and Turkey up 24%.
In contrast, performance in Asia ranged from bad to worse. Japan, the largest
weight in the Fund a year ago at 27% of assets, fell almost 32%. Among the
developed markets in Asia, Malaysia fell 75%, Hong Kong fell 48%, and Singapore
fell 48%. Results in Asia's emerging markets were even worse.
WHAT IS YOUR OUTLOOK FOR THE FUND?
The Fund will continue its strategy of tracking the EAFE/GDP Index with the bulk
of its assets and investing broadly across the emerging markets. We continue to
be optimistic about prospects in the European equity markets. Furthermore,
recent developments in Asia have forced these countries to address their
problems, and we expect those markets to fully recover eventually. We feel that
sticking with the Fund's strategy will allow the Fund to participate in the
recovery.
25
129
The One Group International Equity Index Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
The Fund, by nature of its investment in 34 foreign countries, continues to
offer superb diversification, especially for an investor with a large allocation
to U.S. equities.
/s/ Norman Meltz
- ------------------------------
Norman Meltz
Independence International Associates Inc.
Fund Sub-Advisor
/s/ Richard R. Jandrain III
- ------------------------------
Richard R. Jandrain III
Senior Managing Director of Equity Securities
Please refer to the prospectus and the accompanying financial statements for
more information about your Fund.
26
130
The One Group International Equity Index Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
VALUE OF $10,000 INVESTMENT
Since
Inception
1 Year 5 Year (10/28/92)
Fiduciary 9.54% 10.93% 12.84%
Measurement Period Morgan Stanley
(Fiscal Year Covered) EAFE/GDP Fiduciary
10/92 $10,000 $10,000
6/93 12,248 11,812
6/94 14,527 13,636
6/95 15,057 14,209
6/96 16,946 15,803
6/97 19,378 18,116
6/98 $22,312 $19,843
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
VALUE OF $10,000 INVESTMENT
Since
Inception
1 Year 5 Year (4/23/93)
Class A 9.34% 10.70% 10.21%
Class A* 4.40% 9.68% 9.23%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Measurement Period Morgan Stanley
(Fiscal Year Covered) EAFE/GDP Class A* Class A
4/93 $10,000 $ 9,550 $ 10,000
6/93 9,981 9,510 9,958
6/94 11,837 10,953 11,469
6/95 12,269 11,374 11,913
6/96 13,808 12,641 13,248
6/97 15,790 14,448 15,144
6/98 $18,181 $15,809 $416,556
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
VALUE OF $10,000 INVESTMENT
Since
Inception
1 Year (1/14/94)
Class B 8.48% 8.53%
Class B** 4.48% 8.19%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period Morgan Stanley
(Fiscal Year Covered) EAFE/GDP Class B** Class B
1/94 $10,000 $10,000 $10,000
6/94 10,057 10,323 10,323
6/95 10,424 10,650 10,650
6/96 11,732 11,712 11,712
6/97 13,415 13,278 13,278
6/98 $15,446 $14,203 $14,403
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 16.34%
Class C** 15.34%
** Reflects Applicable Contingent Deferred Sales Charge.
Measurement Period Morgan Stanley Dollars
(Fiscal Year Covered) EAFE/GDP Class C** Class C
11/97 $10,000 $10,000 $10,000
6/98 $12,365 $11,534 $11,634
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
International investing involves increased risk and volatility.
The performance of the International Equity Index Fund is measured against the
Morgan Stanley EAFE/GDP Index, an unmanaged index generally representative of
the performance of international stock markets. Investors are unable to purchase
the index directly, although they can invest in the underlying securities. The
performance of the index does not reflect the deduction of expenses associated
with a mutual fund, such as investment management. By contrast, the performance
of the fund reflects the deduction of these value-added services as well as the
deduction of sales charges on Class A Shares and applicable contingent deferred
sales charges on Class B and Class C Shares.
27
131
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Asset Allocation Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
ASSET BACKED SECURITIES (2.0%):
Financial Services (2.0%):
$ 42 Advanta Mortgage Loan Trust, Series
1994-3, Class A2, 7.60%,
7/25/10.......................... $ 42
542 Case Equipment Loan Trust, Series
1996-B, Class A3, 6.65%,
9/15/03.......................... 552
1,000 Chemical Master Credit Card Trust,
Series 1995-2, Class A, 6.23%,
6/15/03.......................... 1,010
480 Greentree Financial Corp., Series
1996-3, Class A3, 6.70%,
5/15/27.......................... 487
800 Greentree Financial Corp., Series
1996-7, Class A4, 6.80%,
10/15/27......................... 830
105 KeyCorp Auto Grantor Trust, Series
1995-A A, 5.80%,................. 106
312 Nationsbank Auto Owner Trust,
Series 1996-A A3, 6.38%,
7/15/00.......................... 314
525 Olympic Automobile Receivables
Trust, 6.05%, 8/15/02............ 526
1,025 Olympic Automobile Receivables
Trust, Series 1996-B, Class A4,
6.70%, 3/15/02................... 1,036
395 The Money Store Home Equity Trust,
Series 1993-C, 5.18%, 7/15/06.... 391
73 The Money Store Home Equity Trust,
Series 1994-B, Class A2, 6.80%,
2/15/13.......................... 74
--------
Total Asset Backed Securities 5,368
--------
COMMERCIAL PAPER (1.9%):
Financial Services (1.9%):
5,200 Merrill Lynch, 5.59%, 9/18/98
(d).............................. 5,137
--------
Total Commercial Paper 5,137
--------
COMMON STOCKS (53.5%):
Business Equipment & Service (0.7%):
14 Miller (Herman), Inc............... 333
25 Service Corp. International........ 1,085
11 U.S.A. Waste Services, Inc.
(b)(c)........................... 523
--------
1,941
--------
Capital Goods (3.9%):
9 Cooper Industries, Inc............. 483
18 Emerson Electric Co................ 1,092
50 General Electric Co................ 4,504
16 Harsco Corp........................ 738
8 Hubbell, Inc., Class B............. 329
13 Johnson Controls, Inc.............. 725
6 Medusa Corp........................ 389
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
COMMON STOCKS, CONTINUED:
Capital Goods, continued:
25 Teleflex, Inc...................... $ 939
21 Tyco International, Ltd............ 1,335
--------
10,534
--------
Consumer Durable (0.7%):
25 Autozone, Inc. (b)(c).............. 789
21 Chrysler Corp...................... 1,201
--------
1,990
--------
Consumer Non-Durable (4.6%):
28 Coca-Cola Co....................... 2,360
25 ConAgra, Inc....................... 792
14 Interstate Bakeries Corp........... 471
25 Intimate Brands, Inc............... 675
10 Lancaster Colony Corp.............. 367
18 McCormick & Co., Inc............... 654
24 Newell Companies, Inc.............. 1,176
43 Philip Morris Co., Inc............. 1,709
10 Proctor & Gamble Co................ 902
17 Quaker Oats Co..................... 917
15 Revlon, Inc. (b)(c)................ 745
21 Rubbermaid, Inc.................... 710
18 Sara Lee Corp...................... 1,029
--------
12,507
--------
Consumer Services (2.7%):
26 Belo (A.H.) Corp., Series A........ 626
24 Hasbro, Inc........................ 930
30 Hilton Hotels Corp................. 849
13 MGM Grand, Inc. (b)(c)............. 420
22 Tele-Communications, Inc. (b)(c)... 855
19 Time Warner, Inc................... 1,650
17 Viacom, Inc. (b)................... 996
9 Walt Disney Co..................... 893
--------
7,219
--------
Energy (3.9%):
12 Ashland, Inc....................... 609
10 Devon Energy Corp. (c)............. 363
10 Dresser Industries, Inc............ 432
46 Exxon Corp......................... 3,259
30 Royal Dutch Petroleum, NY Shares... 1,633
27 Texaco, Inc........................ 1,612
16 Tosco Corp. (c).................... 479
10 Transocean Offshore, Inc........... 436
17 Ultramar Diamond Shamrock Corp..... 521
33 USX-Marathon Group................. 1,119
--------
10,463
--------
Financial Services (9.3%):
11 Allstate Corp...................... 1,026
9 American International Group,
Inc.............................. 1,343
6 Associates First Capital, Class
A................................ 469
Continued
28
132
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Asset Allocation Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
COMMON STOCKS, CONTINUED:
Financial Services, continued:
11 Bear Stearns Co., Inc.............. $ 614
24 Charter One Financial, Inc......... 809
23 Chase Manhattan Corp............... 1,744
13 Cigna Corp......................... 897
11 Equitable Co., Inc................. 809
27 Federal National Mortgage Assoc.... 1,622
23 First Tennessee National Corp...... 729
18 First Union Corp................... 1,031
10 Hartford Financial Services
Group............................ 1,121
21 MBNA Corp.......................... 690
14 Mercantile Bankshares Corp......... 498
19 Morgan Stanley Dean Witter
Discover......................... 1,754
16 National City Corp................. 1,157
36 NationsBank Corp................... 2,761
6 PMI Group, Inc..................... 462
26 Southtrust Corp.................... 1,151
13 State Street Corp.................. 869
38 Travelers Group, Inc............... 2,322
3 Wells Fargo & Co................... 1,255
--------
25,133
--------
Health Care (5.9%):
33 American Home Products Co.......... 1,713
12 Bausch & Lomb, Inc................. 596
16 Baxter International, Inc.......... 866
10 Boston Scientific Corp. (b)(c)..... 731
24 Bristol Myers Squibb Co............ 2,713
8 Cardinal Health, Inc............... 703
18 IDEXX Laboratories, Inc. (b)....... 458
9 Johnson & Johnson.................. 634
20 Medtronic, Inc..................... 1,275
12 Merck & Co., Inc................... 1,578
8 Pfizer, Inc........................ 837
16 Schering Plough Corp............... 1,439
6 Sofamor Danek Group, Inc. (b)...... 545
27 Warner Lambert Co.................. 1,852
--------
15,940
--------
Raw Materials (2.0%):
12 Betzdearborn, Inc.................. 498
18 Crompton & Knowles Corp............ 456
18 Du Pont (EI) de Nemours & Co....... 1,350
22 Ferro Corp......................... 561
23 Morton International, Inc.......... 585
17 Nalco Chemical Co.................. 580
16 Olin Corp.......................... 663
18 Praxair, Inc....................... 847
--------
5,540
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
COMMON STOCKS, CONTINUED:
Retail (3.7%):
23 Dayton Hudson Corp................. $ 1,130
36 Just For Feet, Inc. (b)............ 1,023
21 Kohl's Corp. (b)................... 1,063
30 Kroger Co. (b)..................... 1,273
42 Officemax, Inc. (b)................ 693
12 Outback Steakhouse, Inc. (b)(c).... 476
16 Safeway, Inc. (b).................. 643
46 Wal-Mart Stores, Inc. (c).......... 2,813
24 Williams Sonoma, Inc. (b).......... 770
--------
9,884
--------
Shelter (1.5%):
6 Armstrong World Industries, Inc.... 411
23 Kimberly Clark Corp................ 1,060
28 Leggett & Platt, Inc............... 705
17 Masco Corp......................... 1,004
18 Pentair, Inc....................... 769
--------
3,949
--------
Technology (8.7%):
18 American Power Conversion (b)...... 543
13 Applied Materials, Inc. (b)........ 378
18 BMC Software, Inc. (b)............. 924
22 Cadence Design Systems, Inc. (b)... 681
29 Cisco Systems, Inc. (b)............ 2,693
29 Dell Computer Corp. (b)............ 2,673
13 Gateway 2000, Inc. (b)(c).......... 643
25 Hewlett Packard Co................. 1,503
36 Intel Corp......................... 2,639
20 International Business Machines.... 2,239
8 Lockheed Martin Corp............... 815
19 LSI Logic Corp. (b)................ 436
20 Lucent Technologies, Inc........... 1,689
16 Maxim Integrated Products, Inc.
(b).............................. 513
48 Microsoft Corp. (b)................ 5,169
--------
23,538
--------
Utilities (5.9%):
18 AES Corp. (b)...................... 951
22 Baltimore Gas & Electric Co........ 677
19 Century Telephone Enterprises...... 885
20 Cinergy Corp....................... 711
17 El Paso Natural Gas................ 646
33 Energy East Corp................... 1,353
24 General Public Utilities Corp...... 908
30 GTE Corp........................... 1,669
13 L G & E Energy Corp................ 346
13 MCN Corp........................... 311
39 Qwest Communications International
(b).............................. 1,377
51 SBC Communications, Inc............ 2,028
24 Sprint Corp........................ 1,713
Continued
29
133
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Asset Allocation Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
COMMON STOCKS, CONTINUED:
Utilities, continued:
24 Williams Cos., Inc. (c)............ $ 797
34 WorldCom, Inc. (b)(c).............. 1,647
--------
16,019
--------
Total Common Stocks 144,657
--------
CORPORATE BONDS (10.8%):
Banking, Finance & Insurance (5.8%):
$1,000 Association Corp., 8.27%,
11/8/01.......................... 1,066
1,000 BankAmerica Corp., 8.13%, 2/1/02... 1,063
500 Chrysler Financial Corp., 5.88%,
2/7/01........................... 499
1,200 Circuit City Credit Card Master
Trust, 6.38%, 8/15/05............ 1,214
1,000 First Hawaiian, Inc., 6.25%,
8/15/00.......................... 1,001
610 Ford Credit Auto Loan Master Trust,
5.50%, 2/15/03................... 606
500 Ford Motor Credit Corp., 8.38%,
1/15/00.......................... 518
250 General Motors Acceptance Corp.,
7.00%, 3/1/00.................... 254
1,250 General Motors Acceptance Corp.,
8.25%, 2/24/04................... 1,365
1,000 Goldman Sachs Group, 7.20%, 3/1/07,
144 A............................ 1,063
750 Huntington National Bank, 6.75%,
6/15/03.......................... 769
1,000 International Lease Finance Corp.,
5.88%, 1/15/01................... 996
1,000 KeyCorp National Bank, 6.75%,
6/15/03.......................... 1,025
300 Lehman Brothers Holdings, Inc.,
8.88%, 11/1/98................... 303
500 Lehman Brothers, Inc., 9.88%,
10/15/00......................... 539
413 MBNA Master Credit Card, 5.40%,
3/15/99.......................... 411
800 McDonnell Douglas Corp., 9.30%,
9/11/02.......................... 825
307 McDonnell Douglas Corp., 6.45%,
12/5/02.......................... 311
1,250 Midland Bank PLC, 6.95%, 3/15/11... 1,303
250 Nationsbank Texas, 6.75%,
8/15/00.......................... 254
500 Suntrust Banks, 7.38%, 7/1/02...... 523
--------
15,908
--------
Consumer Non-Durable (0.4%):
250 Anheuser Busch Co., 8.75%,
12/1/99.......................... 260
500 Campbell Soup Co., 5.63%,
9/15/03.......................... 490
250 Coca-Cola Co., 7.88%, 9/15/98...... 251
--------
1,001
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
CORPORATE BONDS, CONTINUED:
Governments (Foreign) (0.4%):
$1,000 Province of Quebec, 6.50%,
1/17/06.......................... $ 1,021
--------
Industrials (2.4%):
1,000 Cummins Engine Co., Inc., 6.45%,
3/1/05........................... 1,009
1,000 Dayton Hudson Corp., 7.25%,
9/1/04........................... 1,053
200 Du Pont (EI) de Nemours & Co.,
8.70%, 2/7/01.................... 214
250 Ford Motor Co., 9.00%, 9/15/01..... 271
750 Hertz, 6.00%, 1/15/03.............. 744
200 Illinois Tool Works, 7.50%,
12/1/98.......................... 201
500 J C Penney & Co., 5.38%,
11/15/98......................... 498
250 Johnson & Johnson, 7.38%,
6/29/02.......................... 262
1,250 Occidental Petroleum, 9.25%,
8/1/19........................... 1,577
750 Sears Roebuck Acceptance, 7.13%,
5/2/03........................... 776
--------
6,605
--------
Transportation (0.2%):
500 Union Pacific Co., 7.60%, 5/1/05... 535
--------
Utilities (1.6%):
500 AT&T Corp., 6.00%, 8/1/00.......... 499
750 AT&T Corp., 7.50%, 6/1/06.......... 810
1,250 Columbia Gas System, 6.39%,
11/28/00......................... 1,258
250 Duke Power Co., 7.00%, 7/1/00...... 255
250 Southern California Edison, 7.50%,
4/15/99.......................... 253
675 Virginia Electric & Power, 9.15%,
6/10/99.......................... 695
500 Virginia Electric & Power, 6.63%,
4/1/03........................... 512
--------
4,282
--------
Total Corporate Bonds 29,352
--------
FEDERAL AGENCY DEBENTURES (0.7%):
Federal National Mortgage Assoc. (0.7%):
1,000 5.55%, 9/8/98...................... 999
1,000 5.53%, 2/10/99..................... 1,000
--------
Total Federal Agency Debentures 1,999
--------
U.S. GOVERNMENT AGENCY MORTGAGES (15.4%):
Federal Home Loan Mortgage Corp. (5.2%):
102 10.00%, 9/1/03, Pool #E30407....... 108
280 8.00%, 3/1/08, Pool #E45796........ 289
896 7.00%, 1/1/12, Pool #E66116........ 914
1,483 6.50%, 3/1/13, Pool #E69466........ 1,493
1,484 6.00%, 3/1/13, Pool #E69409........ 1,470
1,000 7.00%, 6/1/13, Pool #E00554........ 1,011
1,000 6.50%, 7/1/13, TBA................. 1,012
1,000 6.00%, 7/1/13, TBA................. 988
269 10.50%, 10/1/20, Pool #D24679...... 299
Continued
30
134
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Asset Allocation Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Federal Home Loan Mortgage Corp., continued:
$ 535 8.00%, 4/1/25, Pool #C00401........ $ 555
370 8.00%, 5/1/25, Pool #D60455........ 384
402 7.00%, 2/1/26, Pool #D69343........ 409
637 6.50%, 2/1/26, Pool #D68616........ 637
833 6.50%, 2/1/26, Pool #D68124........ 833
482 7.00%, 3/1/26, Pool #D69430........ 490
791 7.50%, 5/1/26, Pool #C00460........ 813
586 8.50%, 7/1/26, Pool #C00472........ 613
896 7.00%, 10/1/26, Pool #D75494....... 911
858 7.50%, 12/1/27, Pool #C00542....... 879
--------
14,108
--------
Federal National Conventional Loan (0.3%):
534 8.00%, 6/1/24, Pool #270402........ 555
301 8.00%, 6/1/24, Pool #250085........ 313
--------
868
--------
Federal National Mortgage Assoc. (4.8%):
250 6.40%, 1/13/04 (c)................. 250
807 6.50%, 5/1/11, Pool #337195........ 815
1,480 6.00%, 3/1/13, Pool #417081........ 1,464
1,494 6.50%, 4/1/13, Pool #414513........ 1,503
1,000 7.00%, 6/1/13, Pool #427488........ 1,018
2,000 6.50%, 6/25/13, Series 94-1 K...... 2,026
739 7.00%, 7/1/25, Pool #317252........ 753
730 6.50%, 2/1/26, Pool #337115........ 729
994 7.00%, 3/1/26, Pool #365488........ 1,010
753 7.50%, 5/1/26, Pool #344916........ 775
863 7.00%, 5/1/26, Pool #346269........ 877
859 7.50%, 11/1/26, Pool #363626....... 883
996 6.50%, 2/1/28, Pool #417157........ 992
--------
13,095
--------
Government National Mortgage Assoc. (5.1%):
678 5.50%, 4/20/11, Pool #2222......... 655
103 8.00%, 4/15/17, Pool #192100....... 108
59 8.00%, 5/15/22, Pool #329176....... 62
85 6.50%, 1/15/24, Pool #376656....... 86
209 8.00%, 4/15/24, Pool #376038....... 218
895 8.00%, 8/15/24, Pool #394024....... 932
1,260 7.00%, 8/15/25, Pool #413007....... 1,285
909 6.50%, 4/15/26, Pool #424185....... 910
971 6.50%, 4/15/26, Pool #416192....... 971
751 7.50%, 5/15/26, Pool #375345....... 774
903 7.00%, 5/15/26, Pool #375344....... 921
684 8.50%, 1/15/27, Pool #432266....... 723
999 8.00%, 9/15/27, Pool #451932....... 1,035
957 7.50%, 12/15/27, Pool #455358...... 984
987 7.00%, 4/15/28, Pool #473915....... 1,003
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Government National Mortgage Assoc., continued:
$ 999 7.50%, 5/15/28, Pool# 465069....... $ 1,027
1,000 7.00%, 6/15/28, Pool #477123....... 1,016
1,000 6.50%, 7/1/28, TBA................. 997
--------
13,707
--------
Total U.S. Government Agency Mortgages 41,778
--------
U.S. TREASURY OBLIGATIONS (12.4%):
U.S. Treasury Bills (0.1%):
30 8/8/98 (d)......................... 30
30 8/20/98 (d)........................ 30
105 8/27/98 (d)........................ 104
55 9/24/98 (d)........................ 54
--------
218
--------
U.S. Treasury Bonds (5.8%):
750 11.25%, 2/15/15 (c)................ 1,201
5,900 7.50%, 11/15/16 (c)................ 7,080
4,700 8.13%, 8/15/19..................... 6,058
1,000 7.88%, 2/15/21 (c)................. 1,268
--------
15,607
--------
U.S. Treasury Notes (6.5%):
200 8.88%, 2/15/99..................... 204
300 5.88%, 3/31/99 (c)................. 301
300 6.00%, 10/15/99.................... 302
250 7.75%, 11/30/99 (c)................ 257
6,000 6.50%, 5/31/01 (c)................. 6,151
8,500 6.50%, 8/31/01 (c)................. 8,729
150 6.25%, 2/15/03 (c)................. 154
1,500 6.50%, 5/15/05 (c)................. 1,582
--------
17,680
--------
Total U.S. Treasury Obligations 33,505
--------
REPURCHASE AGREEMENTS (4.0%):
10,900 Prudential Securities, 6.10%,
7/1/98, (Collateralized by
$11,056 U.S. Treasury Note,
5.63%, 11/30/99, market value
$11,118)......................... 10,900
--------
Total Repurchase Agreements
............................................... 10,900
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (10.7%):
Master Notes (1.9%):
1,103 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*.................. 1,103
919 Danaher Corp., 6.68%, 10/9/98*..... 919
552 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................. 552
Continued
31
135
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Asset Allocation Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Master Notes, continued:
$1,250 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*.................. $ 1,250
331 NationsBanc Capital Markets, 6.70%,
7/1/98*.......................... 331
1,103 Williamette Industries, Inc.,
5.85%, 7/23/98*.................. 1,103
--------
5,258
--------
Put Bonds (3.0%):
919 Associates Corp. N.A., 5.79%,
1/4/99*.......................... 919
735 Branch Banking & Trust, 5.92%,
12/10/99*........................ 735
368 Citicorp, 5.94%, 8/3/98*........... 368
846 Evangelical Lutheran, 5.74%,
4/28/00*......................... 844
1,103 GMAC, 5.85%, 11/10/99*............. 1,104
919 Goldman Sachs, 6.06%, 11/21/00*.... 919
919 Greenwich Capital, 6.11%,
12/13/99*........................ 919
919 Lehman Brothers Holdings, 5.85%,
8/18/99*......................... 919
368 Merrill Lynch, 6.07%, 11/13/98*.... 368
919 PNC Bank, 5.74%, 10/2/98*.......... 919
--------
8,014
--------
Repurchase Agreements (5.8%):
3,677 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$3,759 various Corporate and
Government Securities,
2.85% - 17.25%, 10/15/02 -
4/15/35, market value $3,818).... 3,677
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$1,838 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $1,959 various
Corporate Bonds, 0.00%, 7/7/98 -
9/18/98, market value $1,952).... $ 1,838
9,450 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $9,686 various
Corporate Bonds, 0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$10,138)......................... 9,450
6 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $7 Media One
Group Bonds, 0.00%, 10/5/98,
market value $7)................. 6
294 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $1,841 various
Government Securities, 0.00% -
10.00%, 12/1/18 - 5/1/24, market
value $303)...................... 294
368 Paine Webber, 6.40%, 7/1/98
(Collateralized by $367 various
Corporate Bonds, 4.00% - 9.75%,
7/15/98 - 12/31/49, market value
$386)............................ 368
--------
15,633
--------
Total Short-Term Securities Held as
Collateral 28,905
--------
Total (Cost $264,919) (a) $301,601
========
- ------------
Percentages indicated are based on net assets of $270,656.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $46. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $38,554
Unrealized depreciation..................................... (1,918)
-------
Net unrealized appreciation................................. $36,636
=======
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
(d) Serves as collateral for futures contracts.
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
CURRENT
NUMBER OPENING MARKET
OF POSITIONS VALUE
CONTRACTS CONTRACT TYPE (000) (000)
- --------- ------------- --------- -------
20 Long S&P 500, September 1998 Futures $5,534 $5,716
See notes to financial statements.
32
136
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Income Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS (94.8%):
Business Equipment & Services (1.9%):
63 Automatic Data Processing, Inc.... $ 4,591
180 Browning-Ferris Industries, Inc.
(b)............................. 6,255
225 Dun & Bradstreet Corp. (b)........ 8,128
----------
18,974
----------
Capital Goods (6.2%):
215 Cooper Industries, Inc............ 11,812
87 Deere & Co........................ 4,600
80 Emerson Electric Co............... 4,825
365 General Electric Co............... 33,215
100 Johnson Controls, Inc............. 5,706
----------
60,158
----------
Consumer Durable (1.9%):
75 Chrysler Corp..................... 4,228
250 Ford Motor Co..................... 14,750
----------
18,978
----------
Consumer Non-Durable (13.8%):
120 American Greetings Corp., Class
A............................... 6,113
254 Campbell Soup Co.................. 13,473
100 Clorox Co......................... 9,538
242 Coca-Cola Co...................... 20,690
450 ConAgra, Inc...................... 14,259
110 Eastman Kodak Co.................. 8,037
150 H.J. Heinz Co..................... 8,419
120 International Flavors &
Fragrances, Inc. (b)............ 5,213
150 McCormick & Co., Inc.............. 5,358
60 Newell Co., Inc................... 2,989
165 PepsiCo, Inc...................... 6,796
325 Philip Morris Co., Inc............ 12,797
165 Proctor & Gamble Co............... 15,024
104 Quaker Oats Co.................... 5,714
----------
134,420
----------
Consumer Services (1.0%):
120 McGraw-Hill Co., Inc.............. 9,788
----------
Energy (8.9%):
265 Amoco Corp........................ 11,031
100 Atlantic Richfield Co............. 7,813
100 Dresser Industries, Inc. (b)...... 4,406
300 Exxon Corp........................ 21,394
100 Halliburton Co. (b)............... 4,456
210 Mobil Corp........................ 16,091
350 Royal Dutch Petroleum Co. (b)..... 19,184
75 USX-Marathon Group................ 2,573
----------
86,948
----------
Financial Services (18.4%):
115 Allstate Corp..................... 10,530
210 American Express Co............... 23,941
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Financial Services, continued:
72 Associates First Capital, Class
A............................... $ 5,541
240 BankAmerica Corp.................. 20,745
146 Chase Manhattan Corp.............. 11,027
65 Citicorp.......................... 9,701
216 Federal National Mortgage Assoc... 13,122
240 First Tennessee National Corp..... 7,575
100 First Union Corp.................. 5,825
95 J.P. Morgan & Co., Inc............ 11,127
155 Lincoln National Corp............. 14,163
125 National City Corp................ 8,875
110 Norwest Corp...................... 4,111
200 Reliastar Financial Corp.......... 9,600
98 Southtrust Corp................... 4,241
80 TransAmerica Corp................. 9,210
240 U.S. Bancorp...................... 10,320
----------
179,654
----------
Health Care (13.5%):
126 Abbott Labs....................... 5,150
400 American Home Products Co......... 20,700
250 Baxter International, Inc......... 13,453
200 Bristol Myers Squibb Co........... 22,987
125 Merck & Co., Inc.................. 16,719
125 Pfizer, Inc....................... 13,586
200 Schering Plough Corp.............. 18,325
300 Warner Lambert Co................. 20,813
----------
131,733
----------
Multi-Industry (0.6%):
70 Minnesota Mining & Manufacturing
Co.............................. 5,753
----------
Raw Materials (3.8%):
150 Dow Chemical Co. (b).............. 14,502
140 Du Pont (EI) de Nemours & Co...... 10,448
150 Nalco Chemical Co................. 5,269
83 Olin Corp......................... 3,460
160 Pall Corp. (b).................... 3,280
----------
36,959
----------
Retail (3.5%):
178 Albertsons, Inc................... 9,223
163 May Department Stores Co.......... 10,680
185 Wal-Mart Stores, Inc. (b)......... 11,238
80 Walgreen Co. (b).................. 3,305
----------
34,446
----------
Shelter (7.0%):
24 Avalon Bay Communities, Inc....... 891
66 Boston Properties, Inc............ 2,280
45 Camden Property Trust............. 1,348
56 CBL & Associates Properties....... 1,353
35 Chelsea GCA Realty, Inc., (b)..... 1,416
Continued
33
137
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Income Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Shelter, continued:
44 Colonial Properties Trust......... $ 1,364
138 Equity Office Properties Trust.... 3,902
35 Equity Residential Properties
Trust........................... 1,651
73 Federal Realty Trust.............. 1,747
32 Gables Residential Trust.......... 857
120 Kimberly Clark Corp............... 5,505
66 Liberty Property Trust............ 1,685
31 Macerich Co....................... 912
58 Mack Cali Realty Corp............. 1,980
142 Masco Corp........................ 8,585
61 Merry Land & Investment Co........ 1,283
55 Mills Corp........................ 1,327
73 Patriot American Hospitality...... 1,747
66 Prentiss Properties Trust......... 1,614
47 Public Storage, Inc............... 1,313
49 Shurgard Storage Centers.......... 1,349
29 Simon Debartolo Group, Inc........ 943
270 Sonoco Products Co................ 8,151
43 Spieker Properties, Inc........... 1,682
95 Starwood Hotels & Resorts (b)..... 4,599
68 Summit Properties, Inc............ 1,292
74 Taubman Centers, Inc.............. 1,059
48 Vornado Realty Trust.............. 1,917
28 Weeks Corp........................ 898
80 Weyerhaeuser Co................... 3,695
----------
68,345
----------
Technology (5.5%):
60 AMP, Inc. (b)..................... 2,063
100 Boeing Co......................... 4,456
127 Hewlett Packard Co................ 7,604
105 International Business Machines... 12,055
60 Lockheed Martin Corp. (b)......... 6,353
60 United Technologies Corp. (b)..... 5,550
150 Xerox Corp........................ 15,243
----------
53,324
----------
Transportation (0.2%):
70 Norfolk Southern Corp............. 2,087
----------
Utilities (8.6%):
181 AT&T Corp. (b).................... 10,332
180 BellSouth Corp.................... 12,083
147 Central & South West Corp......... 3,951
49 El Paso Energy Corp. (c).......... 2,597
50 El Paso Natural Gas Co............ 1,913
160 Entergy Corp...................... 4,600
230 GTE Corp.......................... 12,793
200 L G & E Energy Corp............... 5,423
80 New Century Energies, Inc......... 3,635
140 Northern States Power Co.......... 4,008
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Utilities, continued:
400 SBC Communications, Inc........... $ 15,999
90 Sprint Corp....................... 6,345
----------
83,679
----------
Total Common Stocks 925,246
----------
CONVERTIBLE BONDS (2.5%):
Health Care (1.1%):
$5,000 Alza Corp., 5.00%, 5/1/06......... 6,350
3,500 Athena Neurosciences, 4.75%,
11/15/04, Callable 11/15/00 @
102.7 (b)....................... 4,051
----------
10,401
----------
Shelter (1.1%):
6,500 Hilton Hotels Corp., 5.00%,
5/15/06......................... 6,752
4,500 Medical Care International, 6.75%,
10/1/06......................... 4,123
----------
10,875
----------
Utilities (0.3%):
2,500 U.S. Filter Corp., 4.50%,
12/15/01........................ 2,547
----------
Total Convertible Bonds 23,823
----------
PREFERRED STOCKS (2.4%):
Capital Goods (0.3%):
125 Ingersoll-Rand Co. (c)............ 3,000
----------
Computer Software (0.5%):
55 Microsoft Corp.(c)................ 5,225
----------
Financial Services (0.7%):
60 Newell Financial Trust (c)........ 3,458
45 St. Paul Capital (c).............. 3,204
----------
6,662
----------
Industrial Goods & Services (0.9%):
50 Corning Delaware (c).............. 2,825
120 Crown Cork & Seal Co. (c)......... 5,370
----------
8,195
----------
Total Preferred Stocks 23,082
----------
REPURCHASE AGREEMENTS (0.3%):
$3,405 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $3,505
U.S. Treasury Bills, 9/3/98,
market value $3,474)............ 3,405
----------
Total Repurchase Agreements 3,405
----------
SHORT-TERM SECURITIES HELD AS COLLATERAL (5.4%):
Master Notes (1.0%):
2,021 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*................. 2,021
1,684 Danaher Corp., 6.68%, 10/9/98*.... 1,684
Continued
34
138
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Income Equity Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Master Notes, continued:
$1,011 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*................. $ 1,011
2,292 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*................. 2,292
606 NationsBanc Capital Markets,
6.70%, 7/1/98*.................. 606
2,021 Williamette Industries, Inc.,
5.85%, 7/23/98*................. 2,021
----------
9,635
----------
Put Bonds (1.5%):
1,684 Associates Corp. N.A., 5.79%,
1/4/99*......................... 1,683
1,347 Branch Banking & Trust, 5.92%,
12/10/99*....................... 1,347
674 Citicorp, 5.94%, 8/3/98*.......... 674
1,550 Evangelical Lutheran, 5.74%,
4/28/00*........................ 1,547
2,021 GMAC, 5.85%, 11/10/99*............ 2,025
1,684 Goldman Sachs, 6.66%, 11/21/00*... 1,684
1,684 Greenwich Capital, 6.11%,
12/13/99........................ 1,684
1,684 Lehman Brothers Holdings, 5.85%,
8/18/99*........................ 1,685
674 Merrill Lynch, 6.07%, 11/13/98*... 674
1,684 PNC Bank, 5.74%, 10/2/98*......... 1,683
----------
14,686
----------
Repurchase Agreements (2.9%):
6,737 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$6,888 various Corporate and
Government Securities,
2.85% - 17.25%,
10/15/02 - 4/15/35, market value
$6,996)......................... 6,737
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$3,369 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $3,590
various Corporate Bonds, 0.00%,
7/7/98 - 9/18/98, market value
$3,577)......................... $ 3,369
17,315 Lehman Brothers, 6.55%, 7/1/98
(Collateralized by $17,748
various Corporate Bonds,
0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$18,576)........................ 17,315
12 Lehman Brothers, 6.47%, 7/1/98
(collateralized by $12 Media One
Group Bonds, 0.00%, 10/5/98,
market value $12)............... 12
539 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $3,374
various Government Securities
0.00% - 10.00%, 12/1/18-5/1/24,
market value $555).............. 539
674 Paine Webber, 6.40%, 7/1/98
(Collateralized by $672 various
Corporate Bonds, 4.00% - 9.75%,
7/15/98 - 12/31/49, market value
$707)........................... 674
----------
28,646
----------
Total Short-Term Securities Held as
Collateral 52,967
----------
Total (Cost $549,687) (a) $1,028,523
==========
- ------------
Percentages indicated are based on net assets of $976,168.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting to
approximately $4. Cost for federal income tax purposes differs from value by
net unrealized appreciation of securities as follows (amounts in
thousands.):
Unrealized appreciation..................................... $483,794
Unrealized depreciation..................................... (4,962)
--------
Net unrealized appreciation................................. $478,832
========
(b) A portion of this security was loaned as of June 30, 1998
(c) Non-income producing securities
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
35
139
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMERCIAL PAPER (0.7%):
Financial Services (0.7%):
$9,000 Merrill Lynch, 5.56%, 9/9/98...... $ 8,904
----------
Total Commercial Paper 8,904
----------
COMMON STOCKS (98.3%):
Business Equipment & Services (1.8%):
40 Automatic Data Processing, Inc.... 2,946
25 Browning-Ferris Industries,
Inc............................. 868
12 Canadian Moore Corp., Ltd......... 160
10 Ceridian Corp..................... 613
23 Cognizant Corp.................... 1,449
20 Computer Sciences Corp. (b)....... 1,311
12 Deluxe Corp....................... 415
23 Dun & Bradstreet Corp............. 839
18 Ecolab, Inc....................... 554
21 Equifax, Inc. (c)................. 750
61 First Data Corp................... 2,038
14 H & R Block....................... 592
18 Ikon Office Solutions (c)......... 256
17 Interpublic Group Co., Inc........ 1,018
42 Laidlaw, Inc...................... 511
7 National Service Industries,
Inc............................. 345
21 Omnicom Group, Inc. (c)........... 1,057
37 Pitney Bowes, Inc................. 1,793
21 R.R. Donnelley & Sons Co.......... 957
11 Ryder Systems, Inc. (c)........... 344
34 Service Corp. International....... 1,478
62 WMX Technologies, Inc............. 2,176
----------
22,470
----------
Capital Goods (5.7%):
3 Aeroquip-Vickers, Inc............. 202
12 Black & Decker Corp............... 730
10 Case Corp......................... 472
50 Caterpillar, Inc.................. 2,634
5 Cincinnati Milacron, Inc.......... 131
16 Cooper Industries, Inc............ 901
6 Crane Co.......................... 293
6 Cummins Engine, Inc............... 288
35 Deere & Co........................ 1,842
31 Dover Corp........................ 1,051
61 Emerson Electric Co............... 3,686
12 Fluor Corp........................ 597
5 Foster Wheeler Corp............... 116
444 General Electric Co............... 40,386
7 General Signal Corp............... 252
15 Grainger W.W., Inc................ 739
7 Harnischfeger Industries, Inc..... 193
17 Honeywell, Inc.................... 1,452
33 Illinois Tool Works............... 2,203
22 Ingersoll Rand Co................. 953
11 Johnson Controls, Inc............. 650
1 Nacco Industries, Inc............. 144
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Capital Goods, continued:
11 Navistar International Corp....... $ 303
7 Owens-Corning Fiberglass Corp..... 287
10 Paccar, Inc....................... 537
15 Parker-Hannifin Corp.............. 589
25 PPG Industries, Inc............... 1,737
24 Sherwin-Williams Co............... 795
9 Snap-On, Inc...................... 322
12 Stanley Works..................... 503
20 Thermo Electron Corp. (b)......... 701
8 Timken Co......................... 240
78 Tyco International, Ltd........... 4,923
----------
70,852
----------
Consumer Durable (2.3%):
21 Autozone, Inc. (b) (c)............ 666
3 Briggs & Stratton Corp............ 103
89 Chrysler Corp..................... 4,996
11 Cooper Tire & Rubber Co........... 235
14 Dana Corp. (c).................... 737
11 Eaton Corp........................ 830
9 Echlin, Inc....................... 430
165 Ford Motor Co..................... 9,748
91 General Motors Corp............... 6,093
25 Genuine Parts Co. (c)............. 863
21 Goodyear Tire & Rubber Co. (b).... 1,354
16 ITT Industries, Inc............... 594
14 Maytag Corp....................... 682
10 Whirlpool Corp.................... 714
----------
28,045
----------
Consumer Non-Durable (11.1%):
7 Alberto Culver Co., Class B....... 205
10 American Greetings Corp., Class
A............................... 529
68 Anheuser Busch Co., Inc. (c)...... 3,192
79 Archer-Daniels-Midland Co......... 1,538
18 Avon Products, Inc................ 1,433
4 Ball Corp......................... 143
8 Bemis Co.......................... 307
40 Bestfoods......................... 2,321
10 Brown-Forman Corp., Class B....... 620
64 Campbell Soup Co.................. 3,395
15 Clorox Co......................... 1,387
338 Coca-Cola Co...................... 28,913
40 Colgate Palmolive Co.............. 3,531
66 ConAgra, Inc...................... 2,080
5 Coors Adolph Co., Class B......... 176
17 Crown Cork & Seal Co.............. 815
44 Eastman Kodak Co.................. 3,237
28 Fort James Corp................... 1,267
24 Fortune Brands Inc................ 914
11 Fruit of the Loom, Inc., Class A
(b)............................. 351
22 General Mills, Inc................ 1,495
Continued
36
140
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Consumer Non-Durable, continued:
153 Gillette Co....................... $ 8,648
50 H.J. Heinz Co..................... 2,833
21 Hershey Foods Corp................ 1,447
15 International Flavors &
Fragrances, Inc................. 653
6 Jostens, Inc...................... 135
57 Kellogg Co........................ 2,135
10 Liz Claiborne, Inc. (c)........... 545
22 Newell Co......................... 1,097
40 Nike, Inc., Class B (c)........... 1,927
203 PepsiCo, Inc...................... 8,358
333 Philip Morris Co., Inc............ 13,098
33 Pioneer Hi-Bred International,
Inc............................. 1,378
7 Polaroid Corp..................... 233
183 Proctor & Gamble Co............... 16,706
18 Quaker Oats Co.................... 1,012
14 Ralston Purina Group.............. 1,687
8 Reebok International Ltd. (b)..... 218
21 Rubbermaid, Inc................... 705
5 Russell Corp...................... 163
64 Sara Lee, Corp.................... 3,554
47 Seagram Co., Ltd.................. 1,929
2 Springs Industries, Inc., Class
A............................... 98
10 Supervalu, Inc.................... 427
49 Sysco Corp........................ 1,257
9 Tupperware Corp................... 249
87 Unilever N V...................... 6,888
27 UST, Inc.......................... 721
18 V.F. Corp......................... 925
16 Wrigley (Wm.) Junior Co. (c)...... 1,554
----------
138,429
----------
Consumer Services (4.0%):
13 Brunswick Corp.................... 331
97 CBS Corp. (c)..................... 3,068
116 Cendant Corp...................... 2,425
17 Clear Channel Communications
(b)(c).......................... 1,840
50 Comcast Corp., Class A............ 2,040
13 Dow Jones & Co., Inc.............. 740
38 Gannett, Inc...................... 2,736
14 Harrah's Entertainment, Inc.
(b)(c).......................... 320
18 Hasbro, Inc....................... 697
34 Hilton Hotels Corp................ 975
10 King World Productions, Inc.
(b)............................. 255
11 Knight-Ridder, Inc................ 631
35 Marriott International, Class A... 1,130
38 Mattel, Inc....................... 1,613
14 McGraw-Hill Co., Inc.............. 1,136
85 Media One Group, Inc. (b)(c)...... 3,721
7 Meredith Corp..................... 325
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Consumer Services, continued:
24 Mirage Resorts, Inc. (b)(c)....... $ 513
13 New York Times Co., Class A....... 1,066
69 Tele-Communications, Inc., Class A
(b)(c).......................... 2,648
78 Time Warner, Inc.................. 6,647
12 Times Mirror Co., Class A......... 758
18 Tribune Co........................ 1,224
49 Viacom, Inc., Class B (b)......... 2,850
93 Walt Disney Co.................... 9,734
----------
49,423
----------
Energy (7.2%):
13 Amerada Hess Corp................. 680
131 Amoco Corp........................ 5,437
8 Anadarko Petroleum Corp. (c)...... 546
12 Apache Corp....................... 389
9 Ashland, Inc...................... 469
44 Atlantic Richfield Co............. 3,456
22 Baker Hughes, Inc................. 777
24 Burlington Northern............... 1,029
89 Chevron Corp. (c)................. 7,390
24 Dresser Industries, Inc........... 1,065
333 Exxon Corp........................ 23,763
34 Halliburton Co.................... 1,537
5 Helmerich & Payne, Inc............ 119
7 Kerr McGee Corp................... 423
8 McDermott International, Inc...... 274
108 Mobil Corp........................ 8,245
50 Occidental Petroleum Corp......... 1,351
14 Oryx Energy Co. (b)............... 305
7 Pennzoil Co....................... 335
36 Phillips Petroleum Co............. 1,731
12 Rowan Cos., Inc................... 230
293 Royal Dutch Petroleum Co. (c)..... 16,043
68 Schlumberger Ltd. (c)............. 4,631
10 Sun, Inc.......................... 396
24 Tenneco, Inc...................... 908
75 Texaco, Inc....................... 4,466
34 Union Pacific Resources Group,
Inc............................. 600
34 Unocal Corp. (c).................. 1,201
40 USX-Marathon Group................ 1,358
8 Western Atlas, Inc. (b)........... 662
----------
89,816
----------
Financial Services (17.5%):
57 Allstate Corp..................... 5,239
63 American Express Co............... 7,220
33 American General Corp............. 2,354
96 American International Group,
Inc............................. 14,005
22 Aon Corp.......................... 1,533
47 Associates First Capital, Class
A............................... 3,642
96 Banc One Corp. (c)................ 5,332
Continued
37
141
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Financial Services, continued:
52 Bank of New York Co., Inc. (c).... $ 3,150
93 BankAmerica Corp.................. 8,032
40 Bankboston Corp................... 2,248
13 Bankers Trust New York Corp....... 1,549
19 BB&T Corp......................... 1,253
16 Bear Stearns Co., Inc............. 882
8 Beneficial Corp................... 1,151
9 Capital One Financial Corp........ 1,118
36 Charles Schwab Corp............... 1,174
116 Chase Manhattan Corp.............. 8,748
24 Chubb Corp........................ 1,905
29 Cigna Corp........................ 2,017
22 Cincinnati Financial Corp......... 852
61 Citicorp.......................... 9,169
23 Comerica, Inc..................... 1,496
25 Conseco, Inc. (c)................. 1,155
14 Country Wide Credit............... 721
92 Federal Home Loan Mortgage Corp... 4,352
141 Federal National Mortgage Assoc... 8,590
33 Fifth Third Bancorp (c)........... 2,050
40 First Chicago NBD Corp............ 3,578
132 First Union Corp.................. 7,699
39 Fleet Financial Group, Inc........ 3,240
34 Franklin Resources, Inc........... 1,860
10 General Re Corp................... 2,656
8 Golden West Financial Corp........ 885
19 Green Tree Financial Corp......... 801
15 H.F. Ahmanson & Co................ 1,061
16 Hartford Financial Services
Group........................... 1,805
44 Household International, Inc.
(c)............................. 2,192
26 Huntington Bancshares............. 875
24 J.P. Morgan & Co., Inc............ 2,846
15 Jefferson Pilot Corp.............. 875
60 KeyCorp........................... 2,121
16 Lehman Brothers Holding, Inc...... 1,255
14 Lincoln National Corp............. 1,285
34 Marsh & McLennan Co............... 2,034
13 MBIA, Inc......................... 1,001
69 MBNA Corp......................... 2,262
34 Mellon Bank Corp.................. 2,397
18 Mercantile Bancorporation......... 886
47 Merrill Lynch & Co. (c)........... 4,351
16 MGIC Investment Corp. (c)......... 931
82 Morgan Stanley Dean Witter
Discover........................ 7,484
45 National City Corp................ 3,182
131 NationsBank Corp.................. 9,987
15 Northern Trust Corp............... 1,175
101 Norwest Corp...................... 3,787
42 PNC Bank Corp..................... 2,259
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Financial Services, continued:
9 Progressive Corp., Ohio........... $ 1,335
13 Providian Financial............... 1,017
15 Republic N Y Corp................. 944
19 SAFECO Corp....................... 875
23 SLM Holding Corp.................. 1,142
32 St. Paul Co., Inc................. 1,361
22 State Street Corp................. 1,529
24 Summit Bancorp.................... 1,133
25 Sunamerica, Inc................... 1,446
29 SunTrust Banks, Inc............... 2,386
34 Synovus Financial Corp. (c)....... 810
20 Torchmark Corp.................... 915
9 TransAmerica Corp................. 1,040
156 Travelers Group, Inc.............. 9,439
102 U.S. Bancorp...................... 4,391
21 UNUM Corp......................... 1,150
28 Wachovia Corp..................... 2,355
51 Washington Mutual, Inc. (c)....... 2,234
12 Wells Fargo & Co.................. 4,272
----------
217,481
----------
Health Care (11.9%):
209 Abbott Labs....................... 8,537
20 Aetna............................. 1,543
9 Allergan, Inc..................... 419
12 Alza Corp. (b).................... 507
179 American Home Products Co......... 9,264
36 Amgen, Inc. (b)................... 2,372
8 Bard C.R., Inc.................... 295
8 Bausch & Lomb, Inc................ 402
38 Baxter International, Inc......... 2,026
18 Becton Dickinson & Co. (c)........ 1,368
16 Biomet, Inc....................... 521
27 Boston Scientific Corp. (b) (c)... 1,900
137 Bristol Myers Squibb Co........... 15,701
15 Cardinal Health, Inc.............. 1,398
91 Columbia/HCA Healthcare Corp.
(c)............................. 2,643
152 Eli Lilly & Co.................... 10,052
20 Guidant Corp...................... 1,423
59 HBO & Co.......................... 2,068
54 Healthsouth Corp. (b)............. 1,432
22 Humana, Inc....................... 693
184 Johnson & Johnson................. 13,538
10 Mallinckrodt Group, Inc........... 311
9 Manor Care, Inc................... 343
65 Medtronic, Inc.................... 4,166
164 Merck & Co., Inc.................. 21,871
6 Millipore Corp.................... 176
176 Pfizer, Inc....................... 19,137
69 Pharmacia & Upjohn, Inc........... 3,195
Continued
38
142
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Health Care, continued:
100 Schering Plough Corp.............. $ 9,186
3 Shared Medical Systems Corp....... 194
12 St. Jude Medical Center, Inc.
(b)............................. 435
40 Tenet Healthcare Corp. (b)........ 1,239
9 U.S. Surgical, Corp............... 401
25 United Healthcare Corp............ 1,593
111 Warner Lambert Co................. 7,730
----------
148,079
----------
Multi-Industry (1.1%):
77 Allied Signal, Inc................ 3,419
32 Corning, Inc. (c)................. 1,095
5 FMC Corp.......................... 333
10 Harcourt General, Inc............. 613
16 Loews Corp........................ 1,396
56 Minnesota Mining & Manufacturing
Co.............................. 4,587
2 Octel Corp. (b)................... 43
22 Textron, Inc...................... 1,612
17 TRW, Inc.......................... 950
----------
14,048
----------
Raw Materials (3.0%):
31 Air Products & Chemical, Inc...... 1,231
31 Alcan Aluminum Ltd................ 848
24 Allegheny Teledyne, Inc........... 551
24 Aluminum Co. of America (c)....... 1,577
14 Armco, Inc. (b)................... 90
6 ASARCO, Inc....................... 133
15 Avery Dennison Corp............... 817
10 B. F. Goodrich Co................. 482
49 Barrick Gold Corp................. 946
31 Battle Mountain Gold Co........... 184
15 Bethlehem Steel Corp.............. 186
13 Cyprus Amax Minerals Co........... 174
32 Dow Chemical Co. (c).............. 3,077
155 Du Pont (EI) de Nemours & Co...... 11,541
11 Eastman Chemical Co............... 693
20 Engelhard Corp.................... 401
27 Freeport-McMoran Copper & Gold,
Class B......................... 416
9 Great Lakes Chemical Corp......... 352
14 Hercules, Inc..................... 594
20 Homestake Mining Co. (c).......... 207
23 Inco Ltd.......................... 309
80 Monsanto Co. (c).................. 4,490
20 Morton International, Inc......... 492
10 Nalco Chemical Co................. 335
21 Newmont Mining Corp............... 501
12 Nucor Corp........................ 556
16 Pall Corp......................... 329
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Raw Materials, continued:
9 Phelps Dodge Corp................. $ 505
33 Placer Dome, Inc.................. 383
21 Praxair, Inc...................... 979
9 Reynolds Metals Co................ 508
9 Rohm & Haas Co.................... 917
14 Sigma-Aldrich Corp................ 491
18 Union Carbide Corp................ 971
12 USX -- U.S. Steel Group, Inc...... 384
10 W.R. Grace & Co................... 168
13 Worthington Industries, Inc....... 190
----------
37,008
----------
Retail (6.0%):
1 Abercrombie & Fitch Co. (b)....... 44
34 Albertsons, Inc................... 1,774
39 American Stores Co................ 947
13 Circuit City Stores, Inc.......... 621
15 Consolidated Stores Co. (b)....... 529
29 Costco Companies, Inc. (c)........ 1,855
52 CVS Corp.......................... 2,030
22 Darden Restaurants, Inc........... 346
59 Dayton Hudson Corp................ 2,877
15 Dillard Department Stores, Inc.,
Class A......................... 636
28 Federated Department Stores, Inc.
(b)(c).......................... 1,511
55 Gap, Inc.......................... 3,412
8 Giant Food Inc., Class A.......... 359
5 Great Atlantic & Pacific Tea,
Inc............................. 175
100 Home Depot, Inc................... 8,298
35 J.C. Penney, Inc. (c)............. 2,503
64 K Mart, Inc. (b)(c)............... 1,233
34 Kroger Co. (b).................... 1,450
31 Limited, Inc...................... 1,024
4 Longs Drug Stores, Inc............ 121
47 Lowe's Co......................... 1,900
32 May Department Stores Co.......... 2,097
95 McDonald's Corp................... 6,567
5 Mercantile Stores Co., Inc........ 385
11 Nordstrom, Inc.................... 879
9 Pep Boys--Manny, Moe & Jack....... 166
32 Rite Aid Corp. (c)................ 1,218
53 Sears Roebuck & Co................ 3,260
14 Tandy Corp........................ 741
42 TJX Co., Inc...................... 1,023
38 Toys R Us, Inc. (b)............... 905
21 Tricon Global Restaurants (b)..... 672
18 Venator Group, Inc................ 346
307 Wal-Mart Stores, Inc. (c)......... 18,638
Continued
39
143
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Retail, continued:
68 Walgreen Co....................... $ 2,807
17 Wendy's International, Inc........ 410
21 Winn Dixie Stores, Inc. (c)....... 1,051
----------
74,810
----------
Shelter (1.2%):
5 Armstrong World Industries,
Inc............................. 351
7 Boise Cascade Corp................ 232
7 Centex Corp....................... 274
13 Champion International Co......... 631
5 Fleetwood Enterprises, Inc........ 187
12 Georgia Pacific Corp.............. 733
41 International Paper Co............ 1,762
5 Kaufman & Broad Home Corp......... 169
77 Kimberly Clark Corp............... 3,514
15 Louisiana Pacific Corp............ 268
22 Masco Corp........................ 1,326
16 Mead Corp......................... 499
21 Owens-Illinois, Inc. (b).......... 943
3 Potlatch Corp..................... 146
6 Pulte Corp........................ 183
11 Sealed Air Corp. (b).............. 415
13 Stone Container Corp.............. 203
8 Temple Inland, Inc................ 430
10 Union Camp Corp................... 482
14 Westvaco Corp..................... 390
27 Weyerhaeuser Co................... 1,269
16 Williamette Industries, Inc....... 516
----------
14,923
----------
Technology (14.9%):
46 3Com Corp. (b).................... 1,406
10 Adobe Systems, Inc................ 410
19 Advanced Micro Devices, Inc.
(b)............................. 319
29 AMP, Inc.......................... 1,012
12 Andrew Corp. (b).................. 223
17 Apple Computer, Inc. (b) (c)...... 480
49 Applied Materials, Inc. (b)....... 1,433
26 Ascend Communications, Inc. (b)
(c)............................. 1,303
7 Auto Desk, Inc.................... 263
30 Bay Networks, Inc. (b)............ 978
137 Boeing Co......................... 6,103
21 Cabletron Systems, Inc. (b)....... 281
139 Cisco Systems, Inc. (b)........... 12,800
227 Compaq Computer Corp.............. 6,433
75 Computer Associates International,
Inc............................. 4,164
5 Data General Corp. (b)............ 74
89 Dell Computer Corp. (b)........... 8,272
16 DSC Communications Corp. (b)
(c)............................. 467
7 EG&G, Inc......................... 219
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Technology, continued:
67 EMC Corp. (b) (c)................. $ 3,022
21 Gateway 2000, Inc. (b)............ 1,072
18 General Dynamics Corp............. 825
17 General Instrument Corp. (b)...... 472
10 Harris Corp....................... 465
142 Hewlett Packard Co................ 8,514
231 Intel Corp........................ 17,104
129 International Business Machines... 14,768
11 KLA-Tencor Corp. (b) (c).......... 313
26 Lockheed Martin Corp.............. 2,797
18 LSI Logic Corp. (b)............... 413
179 Lucent Technologies, Inc.......... 14,893
28 Micron Technology, Inc. (b) (c)... 704
335 Microsoft Corp. (b)............... 36,354
81 Motorola, Inc..................... 4,246
22 National Semiconductor Corp. (b)
(c)............................. 294
72 Northern Telecom, Ltd............. 4,083
9 Northrop Grumman Corp............. 931
49 Novell, Inc. (b).................. 626
134 Oracle Corp. (b) (c).............. 3,300
35 Parametric Technology Corp. (b)... 940
6 Perkin-Elmer Corp................. 382
12 Raychem Corp...................... 359
46 Raytheon Co., Class B (c)......... 2,732
28 Rockwell International Corp.
(c)............................. 1,323
11 Scientific-Atlanta, Inc........... 271
34 Seagate Technology, Inc. (b)...... 810
23 Silicon Graphics, Inc. (b)........ 281
51 Sun Microsystems, Inc. (b)........ 2,215
6 Tektronix, Inc.................... 229
24 Tellabs, Inc. (b) (c)............. 1,739
52 Texas Instruments, Inc............ 3,022
7 Thomas & Betts Corp............... 347
34 Unisys Corp....................... 962
31 United Technologies Corp.......... 2,888
44 Xerox Corp. (c)................... 4,515
----------
184,851
----------
Transportation (1.0%):
25 AMR Corp. (b)..................... 2,054
21 Burlington Northern Santa Fe
Corp............................ 2,060
29 CSX Corp.......................... 1,312
10 Delta Air Lines, Inc.............. 1,280
20 FDX Corp. (b)..................... 1,279
52 Norfolk Southern Corp............. 1,564
30 Southwest Airlines Co............. 885
33 Union Pacific Corp. (c)........... 1,475
12 US Air Group...................... 981
----------
12,890
----------
Continued
40
144
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Utilities (9.6%):
77 Airtouch Communications, Inc.
(b)............................. $ 4,508
26 Alltel Corp. (c).................. 1,213
19 Ameren Corp....................... 744
26 American Electric Power, Inc...... 1,168
151 Ameritech Corp.................... 6,798
221 AT&T Corp. (c).................... 12,627
20 Baltimore Gas & Electric Co....... 624
213 Bell Atlantic Corp................ 9,727
136 BellSouth Corp.................... 9,098
21 Carolina Power & Light Co......... 925
29 Central & South West Corp......... 778
21 Cinergy Corp...................... 744
14 Coastal Corp...................... 981
12 Columbia Gas System, Inc.......... 645
32 Consolidated Edison, Inc.......... 1,481
13 Consolidated Natural Gas Co....... 744
20 Detroit Edison Co................. 805
24 Dominion Resources, Inc. of
Virginia........................ 978
49 Duke Power Co., Inc............... 2,893
2 Eastern Enterprises............... 92
49 Edison International.............. 1,458
45 Enron Corp. (c)................... 2,424
32 Entergy Corp...................... 913
31 First Energy Corp................. 964
25 Florida Power & Light Group, Inc.
(c)............................. 1,598
22 Frontier Corp..................... 700
16 General Public Utilities Corp..... 608
132 GTE Corp.......................... 7,323
38 Houston Industries................ 1,173
99 MCI Communications Corp........... 5,735
33 Nextel Communications, Inc., Class
A (b)........................... 830
20 Niagara Mohawk Power Corp. (b).... 294
7 NICOR, Inc........................ 297
19 Northern States Power Co.......... 549
3 Oneok, Inc........................ 133
40 Pacificorp........................ 897
31 Peco Energy Corp. (c)............. 891
4 Peoples Energy Corp............... 173
52 PG & E Corp. (c).................. 1,639
22 PP&L Resources, Inc............... 497
33 Public Service Enterprise Group... 1,139
252 SBC Communications, Inc........... 10,080
18 Sempra Energy (b)................. 492
15 Sonat, Inc........................ 579
92 Southern Co....................... 2,547
59 Sprint Corp....................... 4,166
33 Texas Utilities (c)............... 1,364
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
COMMON STOCKS, CONTINUED:
Utilities, continued:
56 The Williams Companies, Inc.
(c)............................. $ 1,896
29 Unicom Corp....................... 1,028
71 US West, Inc...................... 3,321
139 WorldCom, Inc. (b) (c)............ 6,717
----------
119,998
----------
Total Common Stocks 1,223,123
----------
U.S. TREASURY OBLIGATIONS (0.1%):
U.S. Treasury Bills (0.1%):
$ 220 7/16/98 (d)....................... 220
885 7/23/98 (d)....................... 882
15 8/20/98 (d)....................... 15
520 8/27/98 (d)....................... 516
----------
Total U.S. Treasury Obligations 1,633
----------
REPURCHASE AGREEMENTS (0.8%):
9,880 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $9,880
various U.S. Government
Securities, 6.10% - 6.25%,
4/30/01 - 6/26/03, market value
$9,976)......................... 9,880
----------
Total Repurchase Agreements 9,880
----------
SHORT-TERM SECURITIES HELD AS COLLATERAL (9.2%):
Master Notes (1.7%):
4,384 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*................. 4,384
3,653 Danaher Corp., 6.68%, 10/9/98*.... 3,653
2,192 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*................. 2,192
4,969 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*................. 4,969
1,315 NationsBanc Capital Markets,
6.70%, 7/1/98*.................. 1,315
4,384 Williamette Industries, Inc.,
5.85%, 7/23/98*................. 4,384
----------
20,897
----------
Put Bonds (2.6%):
3,653 Associates Corp. N.A., 5.79%,
1/4/99*......................... 3,651
2,923 Branch Banking & Trust, 5.92%,
12/10/99*....................... 2,923
1,461 Citicorp, 5.94%, 8/3/98*.......... 1,461
3,361 Evangelical Lutheran, 5.74%,
4/28/00*........................ 3,355
4,384 GMAC, 5.85%, 11/10/99*............ 4,391
3,653 Goldman Sachs, 6.06%, 11/21/00*... 3,653
3,653 Greenwich Capital, 6.11%,
12/13/99*....................... 3,653
3,653 Lehman Brothers Holdings, 5.85%,
8/18/99*........................ 3,653
Continued
41
145
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Put Bonds, continued:
$1,461 Merrill Lynch, 6.07%, 11/13/98*... $ 1,461
3,653 PNC Bank, 5.74%, 10/2/98*......... 3,651
----------
31,852
----------
Repurchase Agreements (4.9%):
14,613 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$14,940 various Corporate and
Government Securities,
2.85% - 17.25%,
10/15/02 - 4/15/35, market value
$15,175)........................ 14,613
7,307 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $7,788
various Corporate Bonds, 0.00%,
7/7/98 - 9/18/98, market value
$7,759)......................... 7,307
37,556 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $38,496
various Corporate Bonds,
0.00% - 10.13%,
9/15/99, - 10/17/96, market
value $40,293).................. 37,556
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$ 25 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $27 Media One
Group Bonds, 0.00%, 10/5/98,
market value $27)............... $ 25
1,169 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $7,318
various Government Securities,
0.00% - 10.00%,
12/1/18 - 5/1/24, market value
$1,203)......................... 1,169
1,461 Paine Webber, 6.40%, 7/1/98
(Collateralized by $1,459
various Corporate Bonds,
4.00% - 9.75%, 7/15/98-12/31/49,
market value $1,534)............ 1,461
----------
62,131
----------
Total Short-Term Securities Held as
Collateral 114,880
----------
Total (Cost $914,982) (a) $1,358,421
----------
----------
- ------------
Percentages indicated are based on net assets of $1,244,778.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $828. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $463,433
Unrealized depreciation..................................... (20,822)
--------
Net unrealized appreciation................................. $442,611
========
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
(d) Serves as collateral for futures contracts.
CURRENT
NUMBER OPENING MARKET
OF POSITIONS VALUE
CONTRACTS CONTRACT TYPE (000) (000)
- --------- ------------- --------- -------
Long S&P 500, September 1998
74 Futures $20,861 $21,146
* The interest rate for this variable rate note, which will change periodically,
is based upon a index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
42
146
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Value Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMERCIAL PAPER (1.7%):
Financial Services (1.7%):
$12,800 Merrill Lynch, 5.59%, 9/19/98........ $ 12,646
--------
Total Commercial Paper 12,646
--------
COMMON STOCKS (95.4%):
Business Equipment & Services (1.3%):
67 Miller (Herman), Inc................. 1,617
123 Service Corp. International.......... 5,256
52 U.S.A. Waste Services, Inc. (b)(c)... 2,553
--------
9,426
--------
Capital Goods (7.0%):
43 Cooper Industries, Inc............... 2,368
89 Emerson Electric Co.................. 5,356
243 General Electric Co.................. 22,112
78 Harsco Corp.......................... 3,569
39 Hubbell, Inc., Class B............... 1,640
62 Johnson Controls, Inc................ 3,521
30 Medusa Corp.......................... 1,883
120 Teleflex, Inc........................ 4,560
107 Tyco International Ltd............... 6,747
--------
51,756
--------
Consumer Durable (1.3%):
121 Autozone, Inc. (b)(c)................ 3,874
104 Chrysler Corp........................ 5,852
--------
9,726
--------
Consumer Non-Durable (8.3%):
134 Coca-Cola Co......................... 11,474
120 Conagra, Inc......................... 3,790
69 Interstate Bakeries Corp.(c)......... 2,277
120 Intimate Brands, Inc................. 3,302
47 Lancaster Colony Corp................ 1,788
90 McCormick & Co., Inc................. 3,225
114 Newell Cos., Inc..................... 5,689
208 Philip Morris Co., Inc............... 8,186
48 Proctor & Gamble Co.................. 4,407
83 Quaker Oats Co....................... 4,560
72 Revlon, Inc., Class A (b)(c)......... 3,673
104 Rubbermaid, Inc...................... 3,458
90 Sara Lee Corp........................ 5,023
--------
60,852
--------
Consumer Services (4.7%):
123 Belo (A.H.) Corp., Series A.......... 3,003
115 Hasbro, Inc.......................... 4,505
143 Hilton Hotels Corp................... 4,084
64 MGM Grand, Inc. (b) (c).............. 2,014
110 Tele-Communications, Inc., Class A
(b)(c)............................. 4,211
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Consumer Services, continued:
94 Time Warner, Inc. (c)................ $ 8,065
83 Viacom, Inc., Class B (b)............ 4,841
41 Walt Disney Co....................... 4,308
--------
35,031
--------
Energy (6.9%):
58 Ashland, Inc......................... 2,984
52 Devon Energy Corp. (c)............... 1,803
47 Dresser Industries, Inc. (c)......... 2,080
222 Exxon Corp........................... 15,845
151 Royal Dutch Petroleum Co. (c)........ 8,259
131 Texaco, Inc.......................... 7,813
79 Tosco Corp. (c)...................... 2,324
48 Transocean Offshore, Inc............. 2,114
81 Ultramar Diamond Shamrock Corp....... 2,541
158 USX-Marathon Group................... 5,408
--------
51,171
--------
Financial Services (16.7%):
55 Allstate Corp........................ 5,008
45 American International Group, Inc.... 6,526
29 Associates First Capital, Class A.... 2,260
53 Bear Stearns Co., Inc................ 2,986
117 Charter One Financial, Inc........... 3,925
116 Chase Manhattan Corp................. 8,773
63 Cigna Corp........................... 4,326
53 Equitable Co., Inc................... 3,934
130 Federal National Mortgage Assoc...... 7,916
113 First Tennessee National Corp........ 3,560
86 First Union Corp..................... 5,021
51 Hartford Financial Services Group.... 5,833
102 MBNA Corp............................ 3,356
69 Mercantile Bankshares Corp........... 2,409
98 Morgan Stanley Dean Witter
Discover........................... 8,918
79 National City Corp................... 5,623
175 NationsBank Corp..................... 13,418
31 PMI Group, Inc....................... 2,238
128 Southtrust Corp...................... 5,566
59 State Street Corp.................... 4,087
187 Travelers Group, Inc................. 11,307
17 Wells Fargo & Co..................... 6,384
--------
123,374
--------
Health Care (10.5%):
162 American Home Products Corp.......... 8,389
58 Bausch & Lomb, Inc................... 2,907
79 Baxter International, Inc............ 4,240
50 Boston Scientific Corp. (b)(c)....... 3,553
115 Bristol Myers Squibb Co.............. 13,159
36 Cardinal Health, Inc................. 3,394
90 IDEXX Laboratories, Inc. (b)......... 2,229
42 Johnson & Johnson.................... 3,112
Continued
43
147
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Value Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Health Care, continued:
98 Medtronic, Inc....................... $ 6,248
57 Merck & Co., Inc..................... 7,624
38 Pfizer, Inc.......................... 4,152
77 Schering Plough Corp................. 7,018
31 Sofamor Danek Group, Inc. (b)........ 2,649
130 Warner-Lambert Co.................... 8,991
--------
77,665
--------
Raw Materials (3.7%):
58 Betzdearborn, Inc.................... 2,430
90 Crompton & Knowles Corp.............. 2,254
89 Du Pont (EI) de Nemours & Co......... 6,627
106 Ferro Corp........................... 2,695
118 Morton International, Inc............ 2,943
81 Nalco Chemical Co.................... 2,831
77 Olin Corp............................ 3,197
88 Praxair, Inc......................... 4,105
--------
27,082
--------
Retail (6.5%):
113 Dayton Hudson Corp................... 5,461
175 Just For Feet, Inc. (b)(c)........... 4,988
100 Kohl's Corp. (b)..................... 5,167
143 Kroger Co. (b)....................... 6,114
204 Officemax, Inc. (b).................. 3,371
60 Outback Steakhouse, Inc. (b)(c)...... 2,340
77 Safeway, Inc. (b).................... 3,141
226 Wal-Mart Stores, Inc. (c)............ 13,705
118 Williams Sonoma, Inc. (b)............ 3,744
--------
48,031
--------
Shelter (2.6%):
30 Armstrong World Industries, Inc...... 2,035
112 Kimberly Clark Corp.................. 5,156
138 Leggett & Platt, Inc................. 3,440
81 Masco Corp........................... 4,888
88 Pentair, Inc......................... 3,736
--------
19,255
--------
Technology (15.5%):
88 American Power Conversion (b)........ 2,643
63 Applied Materials, Inc. (b).......... 1,850
87 BMC Software, Inc. (b)............... 4,508
106 Cadence Design Systems, Inc.
(b)(c)............................. 3,309
145 Cisco Systems, Inc. (b).............. 13,317
140 Dell Computer Corp. (b).............. 12,984
62 Gateway 2000, Inc. (b)............... 3,119
122 Hewlett Packard Co................... 7,317
169 Intel Corp........................... 12,535
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Technology, continued:
92 International Business Machines...... $ 10,609
38 Lockheed Martin Corp................. 3,981
92 LSI Logic Corp. (b).................. 2,117
99 Lucent Technologies, Inc............. 8,269
79 Maxim Integrated Products, Inc.
(b)................................ 2,487
230 Microsoft Corp. (b).................. 24,958
--------
114,003
--------
Utilities (9.5%):
88 AES Corp. (b)........................ 4,641
106 Baltimore Gas & Electric Co.......... 3,296
93 Century Telephone Enterprises........ 4,262
98 Cinergy Corp......................... 3,437
82 El Paso Natural Gas.................. 3,137
135 Energy East Corp..................... 5,607
118 General Public Utilities Corp........ 4,462
147 GTE Corp............................. 8,155
62 L G & E Energy Corp.................. 1,678
61 MCN Corp. (c)........................ 1,515
193 Qwest Communications International
(b)................................ 6,743
248 SBC Communications, Inc.............. 9,915
120 Sprint Corp.......................... 8,431
114 Williams Co. (c)..................... 3,861
165 Worldcom, Inc. (b)(c)................ 7,983
--------
70,380
--------
Total Common Stocks 704,495
--------
U.S. TREASURY OBLIGATIONS (0.1%):
U.S. Treasury Bills (0.1%):
$ 485 8/20/98 (d).......................... 482
55 9/24/98 (d).......................... 54
--------
Total U.S. Treasury Obligations 536
--------
REPURCHASE AGREEMENTS (2.7%):
19,589 Prudential Securities, 6.10%, 7/1/98
(Collateralized by $14,752 U.S.
Government Securities, 6.10%-8.75%,
6/26/03-5/15/17, market value
$19,981)........................... 19,589
--------
Total Repurchase Agreements 19,589
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (6.7%):
Master Notes (1.2%):
1,875 Bear Stearns Mortgage Capital, 6.77%,
10/9/98*........................... 1,875
1,563 Danaher Corp., 6.68%, 10/9/98*....... 1,563
938 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................... 938
Continued
44
148
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Value Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Master Notes, continued:
$ 2,125 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*.................... $ 2,124
563 NationsBanc Capital Markets, 6.70%,
7/1/98*............................ 563
1,875 Williamette Industries, Inc., 5.85%,
7/23/98*........................... 1,875
--------
8,938
--------
Put Bonds (1.8%):
1,563 Associates Corp. N.A., 5.79%,
1/4/99*............................ 1,562
1,250 Branch Banking & Trust, 5.92%,
12/10/99*.......................... 1,250
625 Citicorp, 5.94%, 8/3/98*............. 625
1,438 Evangelical Lutheran, 5.74%,
4/28/00*........................... 1,435
1,875 GMAC, 5.85%, 11/10/99*............... 1,877
1,563 Goldman Sachs, 6.06%, 11/21/00*...... 1,563
1,563 Greenwich Capital, 6.11%,
12/13/99*.......................... 1,563
1,563 Lehman Brothers Holdings, 5.85%,
8/18/99*........................... 1,563
625 Merrill Lynch, 6.07%, 11/13/98*...... 625
1,563 PNC Bank, 5.74%, 10/2/98*............ 1,562
--------
13,625
--------
Repurchase Agreements (3.7%):
6,251 Donaldson, Lufkin & Jenrette, 6.65%,
7/1/98 (Collateralized by $6,391
various Corporate and Government
Securities, 2.85% - 17.25%,
10/15/02 - 4/15/35, market value
$6,491)............................ 6,251
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$ 3,125 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $3,331 various
Corporate Bonds, 0.00%, 7/7/98 -
9/18/98, market value $3,319)...... $ 3,125
16,065 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $16,466 various
Corporate Bonds, 0.00% - 10.13%,
9/15/99-10/17/96, market value
$17,235)........................... 16,065
11 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $11 Media One
Group Bonds, 0.00%, 10/5/98, market
value $11)......................... 11
500 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $3,130 various
Government Securities,
0.00% - 10.00%, 12/1/18-5/1/24,
market value $515)................. 500
625 Paine Webber, 6.40%, 7/1/98
(Collateralized by $624 various
Corporate Bonds, 4.00% - 9.75%,
7/15/98 - 12/31/49, market value
$656).............................. 625
--------
26,577
--------
Total Short-Term Securities Held as Collateral 49,140
--------
Total (Cost $617,512) (a) $786,406
========
- ------------
Percentages indicated are based on net assets of $737,575.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $5. Cost for federal income tax purposes differs from value by
net unrealized appreciation of securities as follows (amounts in thousands):
Unrealized appreciation..................................... $176,101
Unrealized depreciation..................................... (7,212)
--------
Net unrealized appreciation................................. $168,889
========
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
(d) Serves as collateral for futures contracts.
CURRENT
NUMBER OPENING MARKET
OF POSITIONS VALUE
CONTRACTS CONTRACT TYPE (000) (000)
- --------- ------------- --------- -------
50 Long S&P 500, September 1998 Futures $13,835 $14,287
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
45
149
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Large Company Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS (94.7%):
Business Equipment & Services (0.5%):
111 Browning-Ferris Industries, Inc.
(c)............................... $ 3,860
--------
Capital Goods (2.9%):
75 Case Corp.(c)....................... 3,619
90 Cooper Industries, Inc.............. 4,944
60 Emerson Electric Co................. 3,619
100 Harsco Corp......................... 4,581
100 Sherwin-Williams Co................. 3,313
100 Trinity Industries, Inc............. 4,150
--------
24,226
--------
Consumer Durable (3.6%):
200 Autozone, Inc. (b) (c).............. 6,388
300 Chrysler Corp....................... 16,912
100 General Motors Corp................. 6,681
--------
29,981
--------
Consumer Non-Durable (6.3%):
200 American Greetings Corp., Class A 10,188
205 Archer-Daniels-Midland Co........... 3,972
50 Eastman Kodak Co.................... 3,653
100 Kellogg Co.......................... 3,756
200 Nike, Inc. (c)...................... 9,738
297 RJR Nabisco Holdings Corp........... 7,063
150 Rubbermaid, Inc. (c)................ 4,978
200 Supervalu, Inc...................... 8,875
--------
52,223
--------
Consumer Services (4.4%):
200 CBS Corp. (c)....................... 6,350
100 Hasbro, Inc......................... 3,931
100 Hilton Hotels Corp.................. 2,850
135 Time Warner, Inc.................... 11,534
195 Viacom, Inc., Class A (b) (c)....... 11,408
--------
36,073
--------
Energy (14.0%):
100 Amoco Corp.......................... 4,163
100 Ashland, Inc........................ 5,163
50 Burlington Resources, Inc........... 2,153
50 Chevron Corp. (c)................... 4,153
100 Dresser Industries, Inc............. 4,406
500 Exxon Corp.......................... 35,656
86 Mobil Corp.......................... 6,620
400 Royal Dutch Petroleum Co. (c)....... 21,925
250 Texaco, Inc......................... 14,922
100 Tosco Corp. (c)..................... 2,938
100 Ultramar Diamond Shamrock Corp...... 3,156
300 USX-Marathon Group.................. 10,294
--------
115,549
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
Financial Services (27.7%):
170 Allstate Corp....................... $ 15,566
200 BankAmerica Corp.................... 17,287
200 Charter One Financial, Inc.......... 6,738
180 Chase Manhattan Corp................ 13,590
150 Cigna Corp.......................... 10,350
100 Citicorp............................ 14,925
150 Federal National Mortgage Assoc..... 9,113
115 First Chicago Corp.................. 10,192
130 First Union Corp. (c)............... 7,573
130 Hartford Financial Services Group... 14,869
120 Household International (c) 5,970
207 KeyCorp............................. 7,389
110 Lincoln National Corp............... 10,051
100 Morgan Stanley Dean Witter
Discover.......................... 9,138
300 NationsBank Corp.................... 22,949
100 Southtrust Corp..................... 4,350
100 State Street Corp................... 6,950
40 TransAmerica Corp................... 4,605
375 Travelers Group, Inc. (c)........... 22,733
40 Wells Fargo & Co.................... 14,760
--------
229,098
--------
Health Care (2.1%):
200 American Home Products Corp......... 10,350
50 Bausch & Lomb, Inc.................. 2,506
100 Biomet, Inc......................... 3,306
50 Tenet Healthcare Corp. (b).......... 1,563
--------
17,725
--------
Multi-Industry (0.7%):
70 Allied Signal, Inc.................. 3,106
30 Loews Corp.......................... 2,614
--------
5,720
--------
Raw Materials (2.0%):
65 Aluminum Co. of America (c)......... 4,258
50 B. F. Goodrich Co................... 2,481
150 Nalco Chemical Co................... 5,269
50 Olin Corp........................... 2,084
50 Praxair, Inc........................ 2,341
--------
16,433
--------
Continued
46
150
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Large Company Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
Retail (3.0%):
125 American Stores Co.................. $ 3,023
95 McDonald's Corp..................... 6,555
250 Sears Roebuck & Co.................. 15,266
--------
24,844
--------
Shelter (2.5%):
25 Armstrong World Industries, Inc..... 1,684
100 International Paper Co. (c)......... 4,300
150 Masco Corp.......................... 9,075
127 Weyerhaeuser Co..................... 5,866
--------
20,925
--------
Technology (7.8%):
119 Boeing Co........................... 5,298
250 Cypress Semiconductor Corp. (b)..... 2,078
300 International Business Machines
(c)............................... 34,444
90 Litton Industries, Inc.(b) (c)...... 5,328
70 Lockheed Martin Corp................ 7,411
100 LSI Logic Corp. (b)................. 2,306
100 Motorola, Inc....................... 5,256
40 Rockwell International Corp. (c).... 1,923
--------
64,044
--------
Transportation (0.4%):
30 Burlington Northern Santa Fe
Corp.............................. 2,946
--------
Utilities (16.8%):
75 Allegheny Energy Inc................ 2,259
100 Ameritech Corp...................... 4,488
150 AT&T Corp. (c)...................... 8,569
250 Baltimore Gas & Electric Co......... 7,766
200 BellSouth Corp...................... 13,424
150 Cinergy Corp........................ 5,250
50 CMS Energy Corp..................... 2,200
140 Edison International................ 4,139
171 El Paso Natural Gas (c)............. 6,555
100 Entergy Corp........................ 2,875
50 Florida Power & Light Group, Inc.... 3,150
150 General Public Utilities Corp....... 5,672
82 GTE Corp............................ 4,561
50 L G & E Energy Corp................. 1,353
200 MCI Communications Corp............. 11,625
200 Public Service Enterprises, Inc..... 6,888
117 Qwest Communications International
(b)............................... 4,067
224 SBC Communications, Inc. (c)........ 8,960
87 Southern Co. (c).................... 2,409
150 Sprint Corp......................... 10,575
50 Texas Utilities Corp. (c)........... 2,081
216 Williams Co., Inc. (c).............. 7,305
250 Worldcom, Inc.(b) (c)............... 12,109
--------
138,280
--------
Total Common Stocks 781,927
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
REPURCHASE AGREEMENTS (4.7%):
$38,915 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $38,915
various U.S. Government Agency
Securities, 0.00% - 6.10%,
12/31/00 - 11/24/14, market value
$39,694).......................... $ 38,915
--------
Total Repurchase Agreements 38,915
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (10.1%):
Master Notes (1.8%):
3,172 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*................... 3,172
2,643 Danaher Corp., 6.68%, 10/9/98*...... 2,643
1,586 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*................... 1,586
3,596 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*................... 3,596
952 NationsBanc Capital Markets, 6.70%,
7/1/98*........................... 952
3,172 Williamette Industries, Inc., 5.85%,
7/23/98*.......................... 3,172
--------
15,121
--------
Put Bonds (2.8%):
2,643 Associates Corp. N.A., 5.79%,
1/4/99*........................... 2,642
2,115 Branch Banking & Trust, 5.92%,
12/10/99*......................... 2,115
1,057 Citicorp, 5.94%, 8/3/98*............ 1,057
2,432 Evangelical Lutheran, 5.74%,
4/28/00*.......................... 2,428
3,172 GMAC, 5.85%, 11/10/99*.............. 3,178
2,643 Goldman Sachs, 6.06%, 11/21/00*..... 2,643
2,643 Greenwich Capital, 6.11%,
12/13/99*......................... 2,643
2,643 Lehman Brothers Holdings, 5.85%,
8/18/99*.......................... 2,644
1,057 Merrill Lynch, 6.07%, 11/13/98*..... 1,057
2,643 PNC Bank, 5.74%, 10/2/98*........... 2,642
--------
23,049
--------
Repurchase Agreements (5.5%):
10,574 Donaldson, Lufkin & Jenrette, 6.65%,
7/1/98 (Collateralized by $10,810
various Corporate and Government
Securities, 2.85% - 17.25%,
10/15/02 - 4/15/35, market value
$10,981).......................... 10,574
5,287 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $5,635 various
Corporate Bonds, 0.00%, 7/7/98 -
9/18/98, market value $5,615)..... 5,287
27,174 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $27,855 various
Corporate Bonds, 0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$29,156).......................... 27,174
Continued
47
151
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Large Company Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$ 18 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $19 Media One
Group Bonds, 0.00%, 10/5/98,
market value $19)................. $ 18
846 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $5,296 various
Government Securities, 0.00% -
10.00%, 12/1/18 - 5/1/24, market
value $871)....................... 846
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$1,057 Paine Webber, 6.40%, 7/1/98
(Collateralized by $1,055 various
Corporate Bonds, 4.00% - 9.75%,
7/15/98 - 12/31/49, market value
$1,110)........................... $ 1,057
--------
44,956
--------
Total Short-Term Securities Held as Collateral 83,126
--------
Total (Cost $708,580) (a) $903,968
========
- ------------
Percentages indicated are based on net assets of $825,502.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $1,248. Cost for federal income tax purposes differs from
value by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $202,188
Unrealized depreciation..................................... (8,048)
--------
Net unrealized appreciation................................. $194,140
========
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
48
152
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Disciplined Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS (98.1%):
Business Equipment & Services (4.6%):
65 A.C. Nielson Corp. (b)............... $ 1,641
24 America Online, Inc. (b)............. 2,544
85 Jacobs Engineering Group, Inc. (b)... 2,724
37 Kelly Services Inc., Class A......... 1,309
222 Office Depot, Inc. (b)(c)............ 7,006
48 Ogden Corp........................... 1,329
64 Olsten Corp.......................... 716
40 Pittston Co.......................... 1,475
90 Sensormatic Electronics Corp. (b).... 1,260
53 Service Corp. International.......... 2,272
60 Sotheby's Holdings, Class A.......... 1,343
20 Standard Register Co................. 708
126 Stewart Enterprises Corp., Class A... 3,355
70 Sungard Data Systems, Inc. (b)(c).... 2,686
36 U.S.A. Waste Services, Inc. (b)(c)... 1,778
--------
32,146
--------
Capital Goods (6.4%):
128 Harsco Corp.......................... 5,855
153 Hubbell, Inc., Class B............... 6,384
33 Johnson Controls, Inc................ 1,883
36 Kennametal, Inc...................... 1,503
82 Mark IV Industries, Inc.............. 1,763
78 Medusa Corp.......................... 4,895
139 Molex, Inc........................... 3,470
87 Southdown, Inc....................... 6,210
84 Teleflex, Inc........................ 3,200
116 Trinity Industries, Inc.............. 4,814
111 United States Filter Corp. (b)(c).... 3,115
33 York International Corp.............. 1,438
--------
44,530
--------
Consumer Durable (0.2%):
42 Autozone, Inc. (b)(c)................ 1,341
--------
Consumer Non-Durable (4.1%):
80 First Brands Corp.................... 2,050
82 Hormel Foods Corp. (c)............... 2,834
93 IBP, Inc............................. 1,686
98 McCormick & Co., Inc................. 3,500
73 Newell Co............................ 3,636
346 Tyson Foods, Inc., Class A........... 7,504
60 U.S. Foodservice (b)................. 2,104
46 Universal Corp....................... 1,719
75 Warnaco Group, Inc., Class A......... 3,183
--------
28,216
--------
Consumer Services (2.8%):
43 Banta Corp........................... 1,328
256 Belo (A.H.) Corp., Series A.......... 6,244
36 Chris-Craft Industries, Inc. (b)..... 1,969
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Consumer Services, continued:
65 Hasbro, Inc.......................... $ 2,555
20 Houghton Mifflin Co.................. 635
51 Lee Enterprises, Inc................. 1,562
35 MGM Grand, Inc. (b) (c).............. 1,105
95 Promus Hotel Corp. (b)............... 3,658
14 Scholastic Corp. (b)................. 558
--------
19,614
--------
Energy (7.2%):
36 Ashland, Inc......................... 1,859
148 BJ Services Co. (b)(c)............... 4,301
145 ENSCO International, Inc............. 2,519
53 Murphy Oil Corp. (c)................. 2,686
100 Nabors Industries, Inc. (b).......... 1,981
63 Noble Affiliates, Inc................ 2,394
175 Noble Drilling Corp. (b)............. 4,211
102 Pioneer Natural Resources Co......... 2,435
60 Tidewater, Inc....................... 1,980
293 Tosco Corp. (c)...................... 8,607
194 Transocean Offshore, Inc............. 8,633
172 Ultramar Diamond Shamrock Corp....... 5,429
93 Valero Energy Corp................... 3,103
--------
50,138
--------
Financial Services (23.5%):
126 A.G. Edwards, Inc.................... 5,379
105 Ambac Financial Group, Inc........... 6,143
40 American Financial Group, Inc........ 1,733
80 Associated Banc-Corp................. 3,010
195 Bear Stearns Co., Inc................ 11,090
29 Capital One Financial Corp........... 3,601
234 Charter One Financial, Inc........... 7,886
21 CMAC Investment Corp................. 1,292
134 Crestar Financial Corp............... 7,311
188 Dime Bancorp, Inc.................... 5,628
51 Finova Group, Inc.................... 2,888
225 First Security Corp.................. 4,816
47 First Virginia Banks, Inc............ 2,398
170 Firstar Corp......................... 6,460
50 GATX Corp............................ 2,194
112 Hibernia Corp., Class A.............. 2,261
18 HSB Group, Inc....................... 987
187 Marshall & Ilsley Corp............... 9,549
45 MBNA Corp............................ 1,485
103 Mercantile Bankshares Corp........... 3,568
23 Northern Trust Corp.................. 1,754
137 Old Kent Financial Corp.............. 4,910
217 Old Republic International Corp...... 6,346
86 Pacific Century Financial Corp....... 2,064
201 Paine Webber Group, Inc.............. 8,596
54 PMI Group, Inc....................... 3,962
Continued
49
153
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Disciplined Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Financial Services, continued:
182 Provident Co., Inc................... $ 6,279
185 Regions Financial Corp............... 7,597
116 Reliastar Financial Corp............. 5,568
249 Southtrust Corp...................... 10,847
30 State Street Corp.................... 2,085
123 TCF Financial Corp................... 3,629
36 Transatlantic Holdings, Inc.......... 2,814
112 Union Planters Corp.................. 6,587
--------
162,717
--------
Health Care (4.4%):
87 Allegiance Corp...................... 4,433
21 ATL Ultrasound, Inc. (b)............. 958
55 Bergen Brunswig Corp., Class A....... 2,551
147 Beverly Enterprises, Inc. (b)(c)..... 2,030
200 Chiron Corp. (b)..................... 3,138
95 Genzyme Corp. (b) (c)................ 2,428
80 HBO & Co............................. 2,820
112 IDEXX Laboratories, Inc. (b)......... 2,786
43 NovaCare, Inc. (b)................... 505
57 PacifiCare Health Systems, Inc.,
Class B (b)........................ 5,038
22 Sofamor Danek Group, Inc. (b)........ 1,904
46 Watson Pharmaceuticals, Inc. (b)..... 2,148
--------
30,739
--------
Multi-Industry (0.2%):
61 Gencorp, Inc......................... 1,540
--------
Raw Materials (5.5%):
47 A. Schulman, Inc..................... 919
96 Airgas, Inc. (b)(c).................. 1,380
35 AK Steel Holding Corp................ 626
28 Albemarle Corp....................... 618
28 Aluminum Co. of America (c).......... 1,820
43 B. F. Goodrich Co.................... 2,134
109 Cabot Corp........................... 3,522
12 Cleveland Cliffs, Inc................ 644
38 Crompton & Knowles Corp.............. 957
33 Dexter Corp.......................... 1,050
23 Fuller (H. B.) Co.................... 1,247
70 Hanna (M.A.) Co...................... 1,286
164 IMC Global, Inc...................... 4,940
83 Lubrizol Corp........................ 2,511
33 Minerals Technologies, Inc........... 1,679
102 Olin Corp............................ 4,252
22 Praxair, Inc......................... 1,030
200 RPM, Inc............................. 3,400
37 Sigma-Aldrich Corp................... 1,300
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Raw Materials, continued:
53 Wellman, Inc......................... $ 1,202
68 Witco Corp........................... 1,989
--------
38,506
--------
Retail (6.3%):
55 BJ's Wholesale Club, Inc. (b)........ 2,234
32 Bob Evans Farms, Inc................. 678
88 Borders Group, Inc. (b).............. 3,256
98 Brinker International, Inc. (b)...... 1,887
43 Buffets, Inc. (b).................... 675
50 Claire's Stores, Inc................. 1,034
105 CompUSA, Inc. (b).................... 1,897
82 Cracker Barrel....................... 2,604
73 Fingerhut Companies, Inc............. 2,409
58 Fred Meyer, Inc. (b)(c).............. 2,482
66 Hannaford Brothers Co................ 2,900
100 Just For Feet, Inc. (b).............. 2,850
40 Kohl's Corp. (b)..................... 2,075
85 OfficeMax, Inc. (b).................. 1,403
96 Outback Steakhouse, Inc. (b)(c)...... 3,743
48 Payless Shoesource, Inc. (b)......... 3,537
115 Proffitts, Inc. (b).................. 4,642
42 Saks Holdings, Inc. (b).............. 1,160
70 Williams Sonoma, Inc. (b)............ 2,227
--------
43,693
--------
Shelter (3.7%):
59 Bowater, Inc......................... 2,788
19 Chesapeake Corp...................... 740
73 Clayton Homes, Inc................... 1,387
116 Consolidated Papers, Inc............. 3,161
108 Georgia Pacific Timber Corp.......... 2,484
134 Leggett & Platt, Inc................. 3,350
35 Masco Corp........................... 2,118
148 Pentair, Inc......................... 6,289
69 Rayonier, Inc........................ 3,165
--------
25,482
--------
Technology (6.4%):
114 American Power Conversion (b)........ 3,420
77 Arrow Electronics, Inc. (b).......... 1,679
68 ATMEL Corp. (b)...................... 927
35 Avnet, Inc........................... 1,887
100 Cirrus Logic, Inc. (b)............... 1,113
84 Cordant Technology, Inc.............. 3,874
38 Dell Computer Corp. (b).............. 3,527
22 Litton Industries, Inc. (b).......... 1,298
130 LSI Logic Corp. (b).................. 2,998
47 NCR Corp. (b)........................ 1,528
96 Qualcomm, Inc. (b)(c)................ 5,393
137 Quantum Corp. (b).................... 2,849
Continued
50
154
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Disciplined Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Technology, continued:
94 SCI Systems, Inc. (b)(c)............. $ 3,537
109 Sterling Software, Inc. (b).......... 3,222
88 Storage Technology Corp. (b)......... 3,816
33 Stratus Computer, Inc. (b)........... 825
46 Teradyne, Inc. (b)(c)................ 1,231
67 Vishay Intertechnology, Inc. (b)..... 1,202
--------
44,326
--------
Transportation (1.4%):
12 Alaska Air Group, Inc. (b)........... 655
58 Alexander & Baldwin, Inc............. 1,689
43 ASA Holdings, Inc.................... 2,134
65 CNF Transportation, Inc.............. 2,762
75 Wisconsin Central Transportation
Corp. (b).......................... 1,641
57 Yellow Corp. (b)..................... 1,058
--------
9,939
--------
Utilities (21.4%):
102 AES Corp. (b)........................ 5,361
307 Allegheny Energy, Inc................ 9,248
70 American Water Works, Inc. (c)....... 2,170
105 Baltimore Gas & Electric Co.......... 3,262
48 Calenergy, Inc. (b).................. 1,443
222 Century Telephone Enterprises........ 10,184
102 Cinergy Corp......................... 3,570
253 CMS Energy Corp. (c)................. 11,133
63 Conectiv, Inc. (b)................... 1,292
290 El Paso Natural Gas Co............... 11,093
151 Energy East Corp..................... 6,285
83 Florida Progress Corp................ 3,413
85 General Public Utilities Corp........ 3,214
100 L G & E Energy Corp.................. 2,706
170 Marketspan Corp...................... 5,089
70 MCN Energy Group, Inc................ 1,741
200 Montana Power Co..................... 6,943
236 New Century Energies, Inc............ 10,702
39 New England Electric System.......... 1,687
171 Nipsco Industries, Inc. (c).......... 4,788
80 Northeast Utilities (b).............. 1,355
122 OGE Energy Corp...................... 3,294
160 Pinnacle West Capital Corp........... 7,182
166 Potomac Electric Power Co............ 4,160
140 Qwest Communications International,
Inc. (b)........................... 4,880
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Utilities, continued:
251 SCANA Corp. (c)...................... $ 7,483
322 TECO Energy, Inc..................... 8,634
130 The Williams Companies, Inc. (c)..... 4,381
36 UtiliCorp United, Inc................ 1,357
--------
148,050
--------
Total Common Stocks 680,977
--------
REPURCHASE AGREEMENTS (2.6%):
$18,245 Prudential Securities, 6.10%, 7/1/98
(Collateralized by $18,437 various
U.S. Government Securities, 5.25% -
6.10%, 11/30/99 - 6/26/03, market
value $18,611)..................... 18,245
--------
Total Repurchase Agreements 18,245
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (8.6%):
Master Notes (1.6%):
2,270 Bear Stearns Mortgage Capital, 6.77%,
10/9/98*........................... 2,270
1,892 Danaher Corp., 6.68%, 10/9/98*....... 1,892
1,135 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................... 1,135
2,572 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*.................... 2,572
681 NationsBanc Capital Markets, 6.70%,
7/1/98*............................ 681
2,270 Williamette Industries, Inc., 5.85%,
7/23/98*........................... 2,270
--------
10,820
--------
Put Bonds (2.4%):
1,892 Associates Corp. N.A., 5.79%,
1/4/99*............................ 1,891
1,513 Branch Banking & Trust, 5.92%,
12/10/99*.......................... 1,513
757 Citicorp, 5.94%, 8/3/98*............. 757
1,740 Evangelical Lutheran, 5.74%,
4/28/00*........................... 1,737
2,270 GMAC, 5.85%, 11/10/99*............... 2,273
1,892 Goldman Sachs, 6.06%, 11/21/00*...... 1,892
1,892 Greenwich Capital, 6.11%,
12/13/99*.......................... 1,892
1,892 Lehman Brothers Holdings, 5.85%,
8/18/99*........................... 1,892
757 Merrill Lynch, 6.07%, 11/13/98*...... 757
1,892 PNC Bank, 5.74%, 10/2/98*............ 1,890
--------
16,494
--------
Continued
51
155
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Disciplined Value Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements (4.6%):
$ 7,567 Donaldson, Lufkin & Jenrette, 6.65%,
7/1/98 (Collateralized by $7,736
various Corporate and Government
Securities, 2.85% - 17.25%,
10/15/02
- 4/15/35, market value $7,858).... $ 7,567
3,783 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $4,032 various
Corporate Bonds, 0.00%, 7/7/98
- 9/18/98, market value $4,018).... 3,783
19,447 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $19,933 various
Corporate Bonds, 0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$20,864)........................... 19,447
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$ 13 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $14 Media One
Group Bonds, 0.00%, 10/5/98, market
value $14)......................... $ 13
605 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $3,790 various
Government Securities,
0.00% - 10.00%, 12/1/18 - 5/1/24,
market value $623)................. 605
757 Paine Webber, 6.40%, 7/1/98
(Collateralized by $755 various
Corporate Bonds, 4.00% - 9.75%,
7/15/98 - 12/31/49, market value
$795).............................. 757
--------
32,172
--------
Total Short-Term Securities Held as Collateral 59,486
--------
Total (Cost $650,635)(a) $758,708
========
- ------------
Percentages indicated are based on net assets of $694,209.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $161. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $120,042
Unrealized depreciation..................................... (12,130)
--------
Net unrealized appreciation................................. $107,912
========
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
52
156
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Large Company Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS (99.6%):
Business Equipment & Services (1.8%):
55 America Online (b)................. $ 5,830
130 Automatic Data Processing, Inc..... 9,474
60 Omnicom Group, Inc. (c)............ 2,993
358 U.S.A. Waste Services, Inc.
(b)(c)........................... 17,695
----------
35,992
----------
Capital Goods (7.8%):
1,474 General Electric Co................ 134,134
345 Tyco International, Ltd. (c)....... 21,741
----------
155,875
----------
Consumer Non-Durable (16.9%):
155 Anheuser Busch Co., Inc............ 7,324
40 Avon Products, Inc................. 3,100
110 Bestfoods.......................... 6,387
200 Campbell Soup Co................... 10,636
1,008 Coca-Cola Co....................... 86,188
140 Colgate Palmolive Co............... 12,320
151 Conagra, Inc....................... 4,791
447 Gillette Co........................ 25,351
65 H.J. Heinz Co...................... 3,654
210 Kellogg Co......................... 7,896
170 Newell Co.......................... 8,483
582 PepsiCo, Inc....................... 23,958
1,101 Philip Morris Co., Inc............. 43,356
568 Procter & Gamble Co................ 51,740
75 Quaker Oats Co..................... 4,120
30 Ralston-Ralston Purina Group....... 3,504
190 Sara Lee, Corp..................... 10,634
250 Unilever N V....................... 19,750
100 UST, Inc........................... 2,700
----------
335,892
----------
Consumer Services (1.8%):
165 Comcast Corp., Class A (c)......... 6,698
115 Gannett, Inc....................... 8,179
200 Hilton Hotels Corp. (c)............ 5,700
95 Mattel, Inc. (c)................... 4,024
190 Tele-Communications, Inc. (b)(c)... 7,307
60 Tribune Co......................... 4,129
----------
36,037
----------
Energy (1.0%):
90 Halliburton Co. (c)................ 4,015
230 Schlumberger Ltd. (c).............. 15,732
----------
19,747
----------
Financial Services (10.3%):
205 American Express Co................ 23,370
279 American International Group, Inc.
(c).............................. 40,686
73 Capital One Financial Corp......... 9,066
171 Charles Schwab Corp. (c)........... 5,541
360 Chase Manhattan Corp............... 27,210
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS, CONTINUED:
Financial Services, continued:
320 Federal National Mortgage Assoc.... $ 19,417
25 Fifth Third Bancorp................ 1,575
94 First Virginia Banks, Inc.......... 4,796
101 Franklin Resources, Inc............ 5,476
200 Household International............ 9,950
69 Marsh & McLennan Co. (c)........... 4,170
210 MBNA Corp. (c)..................... 6,933
40 MGIC Investment Group (c).......... 2,288
130 Morgan Stanley Dean Witter Discover
(c).............................. 11,906
100 National City Corp................. 7,100
59 State Street Corp.................. 4,094
20 T. Rowe Price Associates, Inc...... 751
324 U.S. Bancorp....................... 13,938
150 Washington Mutual, Inc. (c)........ 6,522
----------
204,789
----------
Health Care (20.1%):
471 Abbott Labs........................ 19,236
539 American Home Products Co.......... 27,914
90 Baxter International, Inc.......... 4,854
85 Boston Scientific Corp. (b)(c)..... 6,088
511 Bristol Myers Squibb Co............ 58,676
75 Cardinal Health, Inc. (c).......... 7,031
450 Eli Lilly & Co..................... 29,755
50 Guidant Corp....................... 3,566
170 HBO & Co........................... 6,000
500 Johnson & Johnson.................. 36,859
155 Medtronic, Inc. (c)................ 9,881
446 Merck & Co., Inc................... 59,619
531 Pfizer, Inc........................ 57,710
393 Schering Plough Corp............... 36,013
550 Warner Lambert Co.................. 38,177
----------
401,379
----------
Multi-Industry (0.6%):
150 Minnesota Mining & Manufacturing
Co............................... 12,328
----------
Raw Materials (2.6%):
488 Du Pont (EI) de Nemours & Co....... 36,453
260 Monsanto Co........................ 14,523
----------
50,976
----------
Retail (8.2%):
120 Consolidated Stores Corp. (b)...... 4,350
85 Costco Cos., Inc. (b)(c)........... 5,360
160 CVS Corp........................... 6,238
189 Dayton Hudson Corp. (c)............ 9,186
165 Gap, Inc. (c)...................... 10,174
292 Home Depot, Inc.................... 24,257
808 Just For Feet, Inc. (b)(c)......... 23,025
Continued
53
157
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Large Company Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS, CONTINUED:
Retail, continued:
125 Kroger Co. (b)..................... $ 5,368
162 TJX Cos., Inc...................... 3,899
1,036 Wal-Mart Stores, Inc. (c).......... 62,949
215 Walgreen Co........................ 8,895
----------
163,701
----------
Shelter (0.6%):
239 Kimberly Clark Corp................ 10,963
----------
Technology (21.7%):
185 Applied Materials, Inc. (b)........ 5,460
125 Ascend Communications, Inc. (b).... 6,195
453 Cisco Systems, Inc. (b)............ 41,679
204 Computer Associates International,
Inc. (c)......................... 11,313
0 Compuware Corp. (d)................ 5
565 Dell Computer Corp. (b)............ 52,476
255 EMC Corp. (b)(c)................... 11,436
50 Gateway 2000, Inc. (b)(c).......... 2,536
16 Hewlett Packard Co................. 930
549 Intel Corp......................... 40,673
325 International Business Machines.... 37,314
551 Lucent Technologies, Inc........... 45,795
1,177 Microsoft Corp. (b)................ 127,514
251 Northern Telecom, Ltd.............. 14,244
250 Oracle Corp. (b)(c)................ 6,146
85 Tellabs, Inc. (b)(c)............... 6,088
100 United Technologies Corp........... 9,250
140 Xerox Corp......................... 14,258
----------
433,312
----------
Transportation (0.2%):
50 Southwest Airlines Company......... 1,481
30 US Airways Group, Inc. (b)......... 2,378
----------
3,859
----------
Utilities (6.0%):
230 Airtouch Communications, Inc.
(b).............................. 13,446
451 Ameritech Corp..................... 20,216
623 Bell Atlantic Corp. (c)............ 28,443
370 GTE Corp........................... 20,604
781 SBC Communications, Inc............ 31,232
100 WorldCom, Inc. (b)................. 4,844
----------
118,785
----------
Total Common Stocks.......................... 1,983,635
----------
REPURCHASE AGREEMENTS (0.1%):
$1,891 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $1,947
U.S. Treasury Bills, 9/3/98,
market value $1,929)............. 1,891
----------
Total Repurchase Agreements.................. 1,891
----------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL (8.9%):
Master Notes (1.6%):
$6,760 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*.................. $ 6,760
5,633 Danaher Corp., 6.68%, 10/9/98*..... 5,633
3,380 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................. 3,380
7,661 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*.................. 7,662
2,028 NationsBanc Capital Markets, 6.70%,
7/1/98*.......................... 2,028
6,760 Williamette Industries, Inc.,
5.85%, 7/23/98*.................. 6,760
----------
32,223
----------
Put Bonds (2.5%):
5,633 Associates Corp. N.A., 5.79%,
1/4/99*.......................... 5,630
4,507 Branch Banking & Trust, 5.92%,
12/10/99*........................ 4,507
2,253 Citicorp, 5.94%, 8/3/98*........... 2,253
5,183 Evangelical Lutheran, 5.74%,
4/28/00*......................... 5,174
6,760 GMAC, 5.85%, 11/10/99*............. 6,771
5,633 Goldman Sachs, 6.06%, 11/21/00*.... 5,633
5,633 Greenwich Capital, 6.11%,
12/13/99*........................ 5,633
5,633 Lehman Brothers Holdings, 5.85%,
8/18/99*......................... 5,634
2,253 Merrill Lynch, 6.07%, 11/13/98*.... 2,253
5,633 PNC Bank, 5.74%, 10/2/98*.......... 5,630
----------
49,118
----------
Repurchase Agreements (4.8%):
22,534 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$23,038 various Corporate and
Government Securities,
2.85% - 17.25%,
10/15/02 - 4/15/35, market value
$23,400)......................... 22,534
11,267 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $12,009
various Corporate Bonds, 0.00%,
7/7/98 - 9/18/98, market value
$11,965)......................... 11,267
57,910 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $59,361
various Corporate Bonds,
0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$62,133)......................... 57,910
39 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $41 Media One
Group Bonds, 0.00%, 10/5/98,
market value $41)................ 39
Continued
54
158
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Large Company Growth Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$1,803 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $11,285
various Government Securities,
0.00% - 10.00%, 12/1/18 - 5/1/24,
market value $1,856)............. $ 1,803
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$2,253 Paine Webber, 6.40%, 7/1/98
(Collateralized by $2,249 various
Corporate Bonds, 4.00%-9.75%,
7/15/98-12/31/49, market value
$2,366).......................... $ 2,253
----------
95,806
----------
Total Short-Term Securities Held as
Collateral 177,147
----------
Total (Cost $1,443,904) (a) $2,162,673
==========
- ------------
Percentages indicated are based on net assets of $1,990,628.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $3,471. Cost for federal income tax purposes differs from
value by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $724,999
Unrealized depreciation..................................... (9,701)
--------
Net unrealized appreciation................................. $715,298
========
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
(d) Rounds to less than 1,000
* The interest rate for this variable rate note, which will change periodically,
is based upon on index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
55
159
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Growth Opportunities Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS (98.2%):
Business Equipment & Services (17.7%):
270 AccuStaff, Inc. (b)................ $ 8,438
437 America Online, Inc. (b)(c)........ 46,301
190 Cintas Corp........................ 9,710
210 Comdisco, Inc...................... 3,990
172 Corrections Corporation of America
(b).............................. 4,042
177 Fiserv, Inc. (b)................... 7,508
45 GTECH Holdings Corp. (b)........... 1,516
158 Manpower, Inc...................... 4,544
211 Miller (Herman), Inc............... 5,130
338 Paychex, Inc....................... 13,743
27 Pittston Co........................ 981
59 Policy Management Systems Corp.
(b).............................. 2,316
279 Reynolds & Reynolds Co............. 5,069
563 Staples, Inc. (b)(c)............... 16,286
177 Sterling Commerce, Inc. (b)(c)..... 8,606
240 Sungard Data Systems, Inc.
(b)(c)........................... 9,198
522 U.S.A. Waste Services, Inc.
(b)(c)........................... 25,789
91 Viad Corp.......................... 2,536
280 Viking Office Products (b)......... 8,785
101 Wallace Computer Services, Inc..... 2,401
----------
186,889
----------
Capital Goods (2.6%):
128 Diebold, Inc....................... 3,684
30 Donaldson Co., Inc................. 707
85 Fastenal Co. (c)................... 3,929
76 Federal Signal Corp................ 1,853
75 Martin Marietta Materials, Inc..... 3,375
129 Sundstrand Corp.................... 7,361
70 UCAR International, Inc. (b)....... 2,043
170 United States Filter Corp.
(b)(c)........................... 4,771
----------
27,723
----------
Consumer Durable (2.5%):
222 Danaher Corp. (c).................. 8,134
78 Federal Mogul Corp. (c)............ 5,252
283 Harley-Davidson, Inc............... 10,981
50 Kaydon Corp........................ 1,766
----------
26,133
----------
Consumer Non-Durable (7.7%):
790 Coca-Cola Enterprises, Inc. (c).... 30,991
75 Dean Foods Co...................... 4,120
193 Dial Corp. (c)..................... 4,993
119 Dole Food, Inc..................... 5,923
184 Flowers Industries, Inc............ 3,765
159 General Nutrition Cos., Inc. (b)... 4,952
149 Interstate Bakeries Co. (c)........ 4,928
205 Jones Apparel Group, Inc. (b)...... 7,513
68 Lancaster Colony Corp.............. 2,574
135 McCormick & Co., Inc............... 4,822
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS, CONTINUED:
Consumer Non-Durable, continued:
105 Unifi, Inc......................... $ 3,607
50 Vlasic Foods International, Inc.
(b).............................. 1,006
74 Wausau-Mosinee Paper Corp.......... 1,693
----------
80,887
----------
Consumer Services (2.4%):
4 Belo (A.H.) Corp., Series A........ 98
245 International Game Technologies.... 5,948
50 Media General Inc., Class A........ 2,438
39 Promus Hotel Corp. (b)............. 1,486
38 TCA Cable TV, Inc.................. 2,280
22 Washington Post Co................. 12,901
----------
25,151
----------
Energy (3.8%):
70 Camco International, Inc........... 5,451
7 ENSCO International, Inc........... 118
200 EVI Weatherford, Inc. (b).......... 7,426
367 Global Marine, Inc. (b)............ 6,864
92 Nabors Industries, Inc. (b)........ 1,828
62 Noble Drilling Corp. (b)........... 1,489
209 Ocean Energy, Inc. (b)............. 4,089
96 Smith International, Inc. (b)(c)... 3,352
49 Tidewater, Inc. (c)................ 1,620
108 Tosco Corp. (c).................... 3,184
241 Varco International, Inc. (b)...... 4,779
----------
40,200
----------
Financial Services (7.1%):
537 AFLAC, Inc......................... 16,287
4 Associated Banc-Corp............... 141
14 Capital One Financial Corp......... 1,763
102 City National Corp................. 3,768
5 First Security Corp................ 115
271 First Tennessee National Corp...... 8,553
85 First Virginia Banks, Inc.......... 4,335
19 Marshall & Ilsley Corp............. 970
220 North Fork Bancorp., Inc........... 5,376
184 Robert Half International, Inc.
(b).............................. 10,292
239 T. Rowe Price Associates, Inc...... 8,995
7 TCF Financial Corp................. 204
65 Union Planters Corp................ 3,829
52 Wilmington Trust Corp.............. 3,166
132 Zions Bancorp...................... 7,013
----------
74,807
----------
Health Care (13.0%):
25 Beckman Coulter, Inc............... 1,456
154 Biogen, Inc. (b)................... 7,536
151 Centocor, Inc. (b)(c).............. 5,481
161 Chiron Corp. (b)(c)................ 2,526
30 Concentra Managed Care, Inc.
(b)(c)........................... 780
Continued
56
160
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Growth Opportunities Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS, CONTINUED:
Health Care, continued:
146 DENTSPLY International, Inc........ $ 3,655
161 First Health Group Corp. (b)(c).... 4,584
176 Forest Laboratories, Inc., Class A
(b).............................. 6,292
242 Foundation Health Systems, Inc.,
Series A (b)..................... 6,370
88 Health Care & Retirement Corp.
(b)(c)........................... 3,467
323 Health Management Associates, Inc.
(b).............................. 10,808
125 Hillenbrand Industries, Inc........ 7,470
145 ICN Pharmaceuticals, Inc........... 6,625
190 McKesson Corp. (c)................. 15,437
255 Mylan Laboratories, Inc. (c)....... 7,666
154 Omnicare, Inc...................... 5,871
206 Oxford Health Plans, Inc. (b)...... 3,154
20 PSS World Medical, Inc. (b)........ 293
145 Quintiles Transnational Corp.
(b).............................. 7,132
150 Quorum Health Group, Inc. (b)...... 3,975
40 R. P. Scherer Corp. (b)............ 3,545
183 Stryker Corp. (c).................. 7,038
195 Sybron International Corp. (b)..... 4,924
100 Total Renal Care Holdings, Inc.
(b).............................. 3,450
171 Watson Pharmaceutical, Inc. (b).... 7,993
----------
137,528
----------
Multi-Industry (0.5%):
40 Brio Technology, Inc. (b).......... 535
25 UniCapital Corp. (b)............... 478
200 Whitman Corp....................... 4,588
----------
5,601
----------
Raw Materials (2.5%):
52 Betzdearborn, Inc.................. 2,202
146 Crompton & Knowles Corp............ 3,687
57 Cytec Industries, Inc. (b)......... 2,540
86 Ferro Corp......................... 2,165
161 Lyondell Petrochemical Co.......... 4,910
205 Solutia, Inc....................... 5,882
39 Vulcan Materials Co................ 4,203
38 Witco Corp......................... 1,106
----------
26,695
----------
Retail (9.9%):
131 Barnes & Noble, Inc. (b)........... 4,897
139 Bed Bath & Beyond, Inc. (b)(c)..... 7,223
157 Best Buy, Inc. (b)................. 5,686
100 Borders Group, Inc. (b)............ 3,700
4 CompUSA, Inc. (b).................. 68
295 Dollar General Corp. (c)........... 11,675
412 Family Dollar Stores, Inc.......... 7,616
245 Fred Meyer, Inc. (b)(c)............ 10,413
741 Just For Feet, Inc. (b)............ 21,118
328 Kohl's Corp. (b)................... 16,993
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS, CONTINUED:
Retail, continued:
60 Lands' End, Inc. (b)............... $ 1,898
77 Outback Steakhouse, Inc. (b)....... 3,014
25 Restoration Hardware, Inc.
(b)(c)........................... 628
166 Starbucks Corp. (b)(c)............. 8,860
16 Tiffany & Co....................... 768
----------
104,557
----------
Shelter (2.3%):
129 HON INDUSTRIES, Inc................ 4,386
381 Leggett & Platt, Inc............... 9,520
222 Shaw Industries, Inc............... 3,913
212 Sonoco Products Co................. 6,413
----------
24,232
----------
Technology (19.3%):
280 ADC Telecommunications, Inc.
(b)(c)........................... 10,240
191 Altera Corp. (b)................... 5,649
170 American Power Conversion Corp.
(b).............................. 5,109
431 Analog Devices, Inc. (b)(c)........ 10,582
438 BMC Software, Inc. (b)............. 22,769
514 Cadence Design Systems, Inc.
(b)(c)........................... 16,053
406 Compuware Corp. (b)................ 20,757
55 Comverse Technology, Inc. (b)(c)... 2,853
144 Dell Computer Corp. (b)............ 13,384
126 Electronic Arts, Inc. (b).......... 6,826
130 Keane, Inc. (b).................... 7,280
136 Lexmark International Group, Inc.
(b).............................. 8,296
152 Linear Technology Corp............. 9,161
320 Maxim Integrated Products, Inc.
(b).............................. 10,140
25 MIPS Technologies, Inc. (b)........ 325
243 Network Associates, Inc. (b)(c).... 11,610
125 SCI Systems, Inc. (b)(c)........... 4,707
125 software.net Corp. (b)(c).......... 2,391
233 Solectron Corp. (b)(c)............. 9,809
169 Storage Technology Corp. (b)....... 7,330
63 Structural Dynamics Research Corp.
(b).............................. 1,452
80 Symantec Corp. (b)(c).............. 2,090
111 Symbol Technologies, Inc........... 4,202
115 Synopsys, Inc. (b)(c).............. 5,261
50 Unigraphics Solutions, Inc.
(b)(c)........................... 700
146 Xilinx, Inc. (b)................... 4,978
----------
203,954
----------
Transportation (1.7%):
100 Airborne Freight Corp.............. 3,494
45 Canadian National Railway Co....... 2,365
5 CNF Transportation, Inc............ 213
213 Kansas City Southern Industries,
Inc.............................. 8,870
----------
16,642
----------
Continued
57
161
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Growth Opportunities Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
COMMON STOCKS, CONTINUED:
Utilities (5.2%):
241 360 Communications Co. (b)......... $ 7,696
379 AES Corp. (b)...................... 19,910
270 Cincinnati Bell, Inc. (c).......... 7,729
15 Intelect Communications, Inc.
(b)(c)........................... 80
44 Interstate Energy Corp............. 1,430
271 LG&E Energy Corp................... 7,329
4 MCN Energy Group, Inc.............. 100
2 Qwest Communications International,
Inc. (b)......................... 86
115 Seagull Energy Corp. (b)........... 1,906
133 Southern New England
Telecommunications, Inc.......... 8,711
----------
54,977
----------
Total Common Stocks 1,035,976
----------
REPURCHASE AGREEMENTS (0.5%):
$ 5,221 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $5,374
U.S. Treasury Bills, 9/3/98,
market value $5,326)............. 5,221
----------
Total Repurchase Agreements 5,221
----------
SHORT-TERM SECURITIES HELD AS COLLATERAL (19.5%):
Master Notes (3.5%):
7,860 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*.................. 7,860
6,550 Danaher Corp., 6.68%, 10/9/98*..... 6,550
3,930 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................. 3,930
8,908 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*.................. 8,907
2,358 NationsBanc Capital Markets, 6.70%,
7/1/98*.......................... 2,358
7,860 Williamette Industries, Inc.,
5.85%, 7/23/98*.................. 7,859
----------
37,464
----------
Put Bonds (5.4%):
6,550 Associates Corp. N.A., 5.79%,
1/4/99*.......................... 6,546
5,240 Branch Banking & Trust, 5.92%,
12/10/99*........................ 5,240
2,620 Citicorp, 5.94%, 8/3/98*........... 2,620
6,026 Evangelical Lutheran, 5.74%,
4/28/00*......................... 6,015
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Put Bonds, continued:
$ 7,860 GMAC, 5.85%, 11/10/99*............. $ 7,871
6,550 Goldman Sachs, 6.06%, 11/21/00*.... 6,550
6,550 Greenwich Capital, 6.11%,
12/13/99*........................ 6,550
6,550 Lehman Brothers Holdings, 5.85%,
8/18/99*......................... 6,550
2,620 Merrill Lynch, 6.07%, 11/13/98*.... 2,620
6,550 PNC Bank, 5.74%, 10/2/98*.......... 6,545
----------
57,107
----------
Repurchase Agreements (10.6%):
26,199 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$26,785 various Corporate and
Government Securities, 2.85% -
17.25%, 10/15/02 - 4/15/35,
market value $27,207)............ 26,199
13,099 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $13,962
various Corporate Bonds, 0.00%,
7/7/98 - 9/18/98, market value
$13,911)......................... 13,099
67,332 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $69,017
various Corporate Bonds, 0.00% -
10.13%, 9/15/99 - 10/17/96,
market value $72,239)............ 67,332
45 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $48 Media One
Group Bonds, 0.00%, 10/5/98,
market value $48)................ 45
2,096 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $13,121
various Government Securities,
0.00% - 10.00%, 12/1/18 - 5/1/24,
market value $2,158)............. 2,096
2,620 Paine Webber, 6.40%, 7/1/98
(Collateralized by $2,615 various
Corporate Bonds, 4.00% - 9.75%,
7/15/98 - 12/31/49, market value
$2,751).......................... 2,620
----------
111,391
----------
Total Short-Term Securities Held as
Collateral 205,962
----------
Total (Cost $1,037,010) (a) $1,247,159
==========
- ------------
Percentages indicated are based on net assets of $1,056,566.
Continued
58
162
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Growth Opportunities Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $9,940. Cost for federal income tax purposes differs from
value by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $235,024
Unrealized depreciation..................................... (34,815)
--------
Net unrealized appreciation................................. $200,209
========
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
59
163
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Small Capitalization Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMERCIAL PAPER (4.8%):
Financial Services (4.8%):
$7,300 Merrill Lynch, 5.60%, 9/19/98........ $ 7,212
--------
Total Commercial Paper 7,212
--------
COMMON STOCKS (84.9%):
Business Equipment & Services (9.8%):
20 A Consulting Team, Inc. (b).......... 213
35 Acxiom Corp. (b)..................... 872
15 American Management Systems (b)...... 449
50 Billing Information Concepts (b)..... 774
10 Bowne & Co., Inc..................... 450
28 Carriage Services, Inc., Class A
(b)................................ 704
10 Catalina Marketing Corp. (b)......... 519
15 Central Parking Corp................. 683
40 CHS Electronics, Inc. (b)(c)......... 715
38 Concord EFS, Inc. (b)................ 979
30 Equity Corporation International
(b)................................ 720
20 Hyperion Software Corp. (b).......... 556
30 Inspire Insurance Solutions (b)...... 997
24 Interim Services, Inc. (b)........... 771
25 International Telecommunications Data
Systems (b)........................ 725
15 MPW Industrial Services Group (b).... 203
30 Nova Corp. (b)(c).................... 1,072
30 Paxar Corp. (b)...................... 345
20 Staff Leasing, Inc. (b).............. 590
20 Staffmark, Inc. (b).................. 733
7 Stone & Webster, Inc................. 277
10 Tetra Technologies, Inc. (b)......... 168
12 Wackenhut Corrections Corp. (b)...... 283
10 World Access, Inc. (b)(c)............ 300
18 Zebra Technologies, Class A (b)...... 770
--------
14,868
--------
Capital Goods (4.8%):
13 Applied Power, Inc., Class A......... 447
9 Astec Industries, Inc. (b)........... 311
12 Belden, Inc.......................... 368
26 Blount International, Inc., Class
A.................................. 740
20 Imco Recycling, Inc.................. 370
34 Interface, Inc....................... 686
8 Ionics, Inc. (b)..................... 295
25 Kuhlman Corp......................... 988
8 Lone Star Industries (c)............. 617
10 Medusa Corp.......................... 628
20 Roper Industries, Inc................ 523
30 Savoir Technology Group, Inc.
(b)(c)............................. 345
11 Texas Industries, Inc. (c)........... 583
15 Wabash National Corp. (c)............ 386
--------
7,287
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Consumer Durable (1.5%):
15 Breed Technologies, Inc. (c)......... $ 230
30 Gentex Corp. (b)..................... 544
20 Keystone Automotive Industries, Inc.
(b)................................ 463
7 SPX Corp. (b)........................ 451
18 Watsco, Inc.......................... 632
--------
2,320
--------
Consumer Non-Durable (7.6%):
26 Advanced Energy Corp. (b)............ 605
10 Aptargroup, Inc...................... 622
13 Canandaigua Wine Co., Class A (b).... 639
6 Coca-Cola Bottling Co................ 397
20 Corn Products International, Inc.
(b)................................ 678
20 Earthgrains Co....................... 1,117
17 Guilford Mills, Inc.................. 340
25 Mohawk Industries Co. (b)............ 792
22 Natures Sunshine Products, Inc....... 496
20 Nautica Enterprises, Inc. (b)........ 536
40 NBTY, Inc. (b)....................... 735
15 Pacific Sunwear of California (b).... 525
14 Pillowtex Corp....................... 562
18 Richfood Holdings, Inc............... 372
18 Smithfield Foods, Inc. (b)........... 549
12 St. John Knits, Inc.................. 464
6 Timberland Co., Class A (b).......... 432
30 Westpoint Stevens, Inc. (b)(c)....... 989
30 Wolverine World Wide, Inc............ 651
--------
11,501
--------
Consumer Services (2.7%):
30 Action Performance Co., Inc.
(b)(c)............................. 965
10 Carmike Cinemas, Inc., Class A (b)... 269
22 Grand Casinos (b).................... 369
25 International Speedway Corp., Class
A.................................. 710
30 Players International, Inc. (b)...... 149
22 Primadonna Resorts, Inc. (b)......... 316
10 Sturm, Ruger & Co., Inc.............. 168
30 Suburban Lodges of America (b)....... 454
12 World Color Press, Inc. (b).......... 420
--------
3,820
--------
Energy (2.7%):
10 Barrett Resources Corp. (b).......... 374
10 Devon Energy Corp. (c)............... 349
40 EEX Corp. (b)........................ 375
20 Global Industries Ltd. (b)........... 338
12 Newfield Exploration Co. (b)......... 299
20 Newpark Resources, Inc. (b).......... 223
30 Patterson Energy, Inc. (b)........... 293
25 Pride Petroleum Services, Inc. (b)... 423
7 Saint Mary Land & Exploration........ 169
25 Santa Fe Energy Resources, Inc.
(b)................................ 269
Continued
60
164
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Small Capitalization Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Energy, continued:
10 Snyder Oil Corp...................... $ 199
12 Stone Energy Corp. (b)............... 426
25 Superior Energy Services, Inc. (b)... 127
12 Vintage Petroleum, Inc............... 227
--------
4,091
--------
Financial Services (14.0%):
35 Alabama National Bankcorp............ 1,316
25 Allied Capital Corp.................. 613
25 Amresco, Inc. (b).................... 728
11 BankAtlantic Bancorp, Inc., Series
B.................................. 145
13 Centura Banks, Inc................... 813
20 Colonial BancGroup, Inc.............. 645
35 Cooperative Bankshares, Inc. (b)..... 613
15 Cullen/Frost Bankers, Inc............ 814
10 Dain Rauscher Corp................... 548
15 Eagle Bancshares, Inc................ 360
15 Fidelity Bankshares, Inc............. 429
15 Fidelity National Corp. (b).......... 169
11 First Commercial Corp................ 729
40 First Financial Holdings, Inc........ 950
30 First Liberty Financial Corp......... 735
12 Keystone Financial, Inc.............. 444
10 Legg Mason, Inc...................... 576
35 Long Beach Financial Corp. (b)....... 385
15 Morgan Keegan, Inc................... 388
20 PMT Services, Inc. (b)............... 509
50 Protective Life Corp. (c)............ 1,833
16 Provident Financial Group, Inc....... 730
23 Raymond James Financial, Inc......... 674
22 Republic Bancshares, Inc. (b)........ 597
37 Resource Bancshares Mortgage Group... 689
50 Sirrom Capital Corp. (c)............. 1,300
42 Sovereign Bancorp, Inc............... 686
17 Trans Financial, Inc................. 975
30 Triad Guaranty, Inc. (b)............. 1,020
12 Whitney Holding Corp................. 609
--------
21,022
--------
Health Care (9.0%):
13 Alpharma, Inc., Class A (c).......... 282
14 Ballard Medical Products............. 259
24 Centennial Healthcare Corp. (b)...... 435
8 Cooper Cos., Inc. (b)................ 273
15 Cryolife, Inc. (b)................... 236
30 Genesis Health Ventures, Inc.
(b)(c)............................. 750
17 IDEXX Laboratories, Inc. (b)......... 413
11 Incyte Pharmaceuticals, Inc. (b)..... 379
14 Invacare Corp........................ 364
11 Jones Pharma, Inc.................... 364
22 Lincare Holdings, Inc. (b)........... 925
12 MedImmune, Inc. (b).................. 724
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Health Care, continued:
12 Mentor Corp.......................... $ 293
4 North American Vaccine, Inc.
(b)(c)............................. 57
43 Orthodontic Centers of America
(b)(c)............................. 890
18 Patterson Dental Co. (b)............. 641
20 Phycor, Inc. (b)..................... 331
11 Protein Design Labs, Inc. (b)........ 263
18 PSS World Medical, Inc. (b).......... 256
19 Quorum Health Group, Inc. (b)........ 504
18 Respironics, Inc. (b)................ 283
24 Roberts Pharmaceutical Corp. (b)..... 552
22 Safeskin Corp. (b)................... 888
14 Steris Corp. (b)..................... 909
28 Sunrise Assisted Living, Inc.
(b)(c)............................. 945
15 Universal Health Services, Class B
(b)................................ 876
7 Vertex Pharmaceuticals, Inc.
(b)(c)............................. 158
7 Visx, Inc. (b)....................... 399
--------
13,649
--------
Manufacturing-Capital Goods (0.3%):
11 Wolverine Tube, Inc. (b)............. 418
--------
Multi-Industry (0.4%):
40 Denali, Inc. (b)..................... 625
--------
Raw Materials (2.5%):
27 Birmingham Steel Corp................ 334
20 Buckeye Technologies, Inc. (b)....... 471
22 Cambrex Corp......................... 578
25 Chemfirst, Inc....................... 632
20 Quanex Corp.......................... 606
16 Scotts Co., Class A (b).............. 596
6 Tredegar Industries, Inc............. 509
--------
3,726
--------
Retail (7.7%):
16 Cash America International, Inc...... 244
35 Cato Corp., Class A.................. 609
15 CKE Restaurants, Inc................. 619
10 Discount Auto Parts, Inc. (b)........ 260
14 Eagle Hardware & Garden, Inc. (b).... 324
12 Footstar, Inc. (b)................... 576
30 Hibbet Sporting Goods, Inc. (b)(c)... 1,201
30 Just For Feet, Inc. (b).............. 855
25 Landry's Seafood Restaurants, Inc.
(b)................................ 452
18 Men's Wearhouse, Inc. (b)............ 594
30 Michaels Stores, Inc. (b)............ 1,058
18 O'Reilly Automotive, Inc. (b)........ 648
12 Papa John's International, Inc.
(b)................................ 473
30 Pier 1 Imports, Inc.................. 716
19 Ross Stores, Inc..................... 817
36 Ruby Tuesday, Inc. (b)............... 558
46 Stein Mart, Inc. (b)................. 621
Continued
61
165
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Small Capitalization Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Retail, continued:
15 Travis Boats & Motors, Inc. (b)...... $ 368
20 Williams Sonoma, Inc. (b)............ 636
--------
11,629
--------
Shelter (4.0%):
24 Caraustar Industries, Inc............ 693
15 Crossmann Communities, Inc. (b)...... 456
30 Ethan Allen Interiors, Inc........... 1,498
12 La-Z-Boy, Inc........................ 678
15 Ladd Furniture, Inc. (b)............. 450
20 Oakwood Homes Corp................... 600
10 Palm Harbor Homes, Inc. (b).......... 426
15 Pulaski Furniture Corp............... 375
17 Toll Brothers, Inc. (b).............. 488
9 U S Home Corp. (b)................... 371
--------
6,035
--------
Technology (12.6%):
12 Aavid Thermal Technologies (b)....... 351
14 Adtran, Inc. (b)..................... 366
14 Alliant Techsystems, Inc. (b)........ 886
38 Anixter International, Inc. (b)...... 724
33 Applied Materials, Inc. (b).......... 974
46 Aspect Telecommunications, Inc.
(b)................................ 1,259
34 Berg Electronics, Corp. (b).......... 665
60 Brightpoint, Inc. (b)(c)............. 870
1 Com21, Inc. (b)...................... 21
24 Comverse Technology, Inc. (b)(c)..... 1,219
20 Corsair Communications, Inc.
(b)(c)............................. 186
4 Datastream Systems, Inc. (b)......... 76
11 Etec Systems, Inc. (b)............... 387
47 Harbinger Corp. (b).................. 1,125
50 Infinium Software, Inc. (b).......... 694
15 MacDermid, Inc....................... 424
14 Microchip Technology, Inc. (b)....... 366
9 Novellus Systems, Inc. (b)........... 321
13 Oak Industries, Inc. (b)............. 460
37 P-Com, Inc. (b)...................... 339
14 Photronics, Inc. (b)................. 309
49 Platinum Technology, Inc. (b)(c)..... 1,399
20 Plexus Corp. (b)..................... 398
40 Powertel, Inc. (b)................... 740
41 Sanmina Corp. (b)(c)................. 1,795
16 SCI Systems, Inc. (b)(c)............. 606
18 Systems & Computer Technology Corp.
(b)................................ 486
34 Tech Data Corp. (b).................. 1,457
--------
18,903
--------
Transportation (3.2%):
34 Atlantic Coast Airlines, Inc. (b).... 1,020
23 Comair Holdings, Inc................. 695
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
COMMON STOCKS, CONTINUED:
Transportation, continued:
20 Halter Marine Group, Inc. (b)........ $ 301
25 Heartland Express, Inc. (b).......... 506
10 MS Carriers, Inc. (b)................ 271
15 Railtex, Inc. (b).................... 199
32 Skywest, Inc......................... 896
10 U.S. Xpress Enterprises, Class A
(b)................................ 168
10 USFreightways Corp................... 328
23 Werner Enterprises, Inc.............. 429
--------
4,813
--------
Utilities (2.1%):
22 Energen Corp......................... 443
16 K N Energy, Inc...................... 866
15 Public Service Co. of NC, Inc........ 326
33 Rural Cellular Corp., Class A (b).... 516
11 Sierra Pacific Resources............. 399
26 Tel-Save Holdings, Inc. (b)(c)....... 384
10 TNP Enterprises, Inc................. 309
--------
3,243
--------
Total Common Stocks 127,950
--------
PREFERRED STOCKS (1.3%):
Computer Software (0.3%):
11 National Data Corp................... 481
Financial Services (1.0%):
10 CCB Financial Corp................... 1,063
20 Southwest Securities Group, Inc...... 450
--------
1,513
--------
Total Preferred Stocks 1,994
--------
U.S. TREASURY OBLIGATIONS (0.1%):
U.S. Treasury Bills (0.1%):
$ 50 7/23/98 (d).......................... 50
110 8/20/98 (d).......................... 109
40 8/27/98 (d).......................... 40
15 9/24/98 (d).......................... 15
--------
Total U.S. Treasury Obligations 214
--------
REPURCHASE AGREEMENTS (3.9%):
5,937 Prudential Securities, 6.10%, 7/1/98
(Collateralized by $6,111 U.S.
Treasury Bills, 9/3/98, market
value $6,057)...................... 5,937
--------
Total Repurchase Agreements 5,937
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (9.6%):
Master Notes (1.7%):
555 Bear Stearns Mortgage Capital, 6.77%,
10/9/98*........................... 555
462 Danaher Corp., 6.68%, 10/9/98*....... 462
277 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................... 277
Continued
62
166
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Small Capitalization Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Master Notes, continued:
$ 629 Morgan Stanley Mortgage Capital,
5.76%, 7/21/98*.................... $ 629
166 NationsBanc Capital Markets, 6.70%,
7/1/98*............................ 166
555 Williamette Industries, Inc., 5.85%,
7/23/98*........................... 555
--------
2,644
--------
Put Bonds (2.7%):
462 Associates Corp. N.A., 5.79%,
1/4/99*............................ 462
370 Branch Banking & Trust, 5.92%,
12/10/99*.......................... 370
185 Citicorp, 5.94%, 8/3/98*............. 185
425 Evangelical Lutheran, 5.74%,
4/28/00*........................... 425
555 GMAC, 5.85%, 11/10/99*............... 556
462 Goldman Sachs, 6.06%, 11/21/00*...... 462
462 Greenwich Capital, 6.11%,
12/13/99*.......................... 462
462 Lehman Brothers Holdings, 5.85%,
8/18/99*........................... 462
185 Merrill Lynch, 6.07%, 11/13/98*...... 185
462 PNC Bank, 5.74%, 10/2/98*............ 462
--------
4,031
--------
Repurchase Agreements (5.2%):
1,849 Donaldson, Lufkin & Jenrette, 6.65%,
7/1/98 (Collateralized by $1,891
various Corporate and Government
Securities, 2.85% - 17.25%,
10/15/02 - 4/15/35, market value
$1,920)............................ 1,849
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$ 925 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $985 various
Corporate Bonds, 0.00%,
7/7/98-9/18/98, market value
$982).............................. $ 925
4,752 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $4,871 various
Corporate Bonds, 0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$5,099)............................ 4,752
3 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $3 Media One
Group Bonds, 0.00%, 10/5/98, market
value $3).......................... 3
148 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $926 various
Government Securities, 0.00% -
10.00%, 12/1/18 - 5/1/24, market
value $152)........................ 148
185 Paine Webber, 6.40%, 7/1/98
(Collateralized by $185 various
Corporate Bonds, 4.00% - 9.75%,
7/15/98 - 12/31/49, market value
$194).............................. 185
--------
7,862
--------
Total Short-Term Securities Held as Collateral 14,537
--------
Total (Cost $132,255)(a) $157,845
========
- ------------
Percentages indicated are based on net assets of $145,242.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $19. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $30,146
Unrealized depreciation..................................... (4,575)
-------
Net unrealized appreciation................................. $25,571
=======
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
(d) Serves as collateral for futures contracts.
CURRENT
NUMBER OPENING MARKET
OF POSITIONS VALUE
CONTRACTS CONTRACT TYPE (000) (000)
- ---------- ------------- --------- -------
25 Long Russell 2000 September 1998 Futures $5,485 $5,779
10 Long Midcap 400, September 1998 Futures 1,782 1,823
------ ------
$7,267 $7,602
====== ======
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
See notes to financial statements.
63
167
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS (94.5%):
ARGENTINA (0.5%):
Automotive (0.0%):
34 Renault Argentina................... $ 68
--------
Banking & Finance (0.0%):
40 Banco Galicia....................... 176
--------
Beverages & Tobacco (0.0%):
0 Buenos Aires Embottelladora SA,
Class B (b)(e).................... 0
--------
Metals & Mining (0.0%):
17 Siderca SA.......................... 29
--------
Oil & Gas Exploration, Production & Services (0.3%):
130 Perez Companc SA.................... 652
39 YPF Sociedad Anonima................ 1,160
--------
1,812
--------
Telecommunications (0.2%):
89 Telecom Argentina SA, Class B....... 505
235 Telefonica de Argentina SA, Class
B................................. 758
--------
1,263
--------
Total Argentina..................... 3,348
--------
AUSTRALIA (1.6%):
Banking (0.4%):
120 National Australia Bank Ltd......... 1,581
171 Westpac Banking Corp., Ltd.......... 1,043
--------
2,624
--------
Beverages & Tobacco (0.1%):
57 Coca-Cola Amatil Ltd................ 371
--------
Brewery (0.0%):
113 Foster's Brewing Group Ltd.......... 266
--------
Broadcasting & Publishing (0.2%):
157 News Corp., Ltd. (b)................ 1,278
--------
Building Products (0.2%):
221 Boral Ltd........................... 414
135 CSR Ltd............................. 390
131 Pioneer International Ltd........... 313
--------
1,117
--------
Diversified (0.0%):
82 Southcorp Holdings Ltd.............. 238
--------
Engineering (0.0%):
31 Leighton Holdings Ltd............... 108
--------
Metals (0.0%):
229 M.I.M. Holdings Ltd................. 111
36 RGC Ltd. (b)........................ 35
--------
146
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
AUSTRALIA, CONTINUED:
Metals & Mining (0.3%):
68 Aberfoyle Ltd....................... $ 108
125 Australian National Industries
Ltd............................... 72
135 Broken Hill Proprietary Co. Ltd..... 1,139
30 Delta Gold.......................... 37
28 Great Central Mines Ltd............. 26
12 Homestake Mining Company............ 118
35 Newcrest Mining Ltd. (b)............ 42
122 Normandy Mining Ltd................. 100
31 Resolute Limited (b)(e)............. 19
87 WMC Ltd............................. 261
--------
1,922
--------
Real Estate (0.2%):
186 General Property Trust.............. 301
177 Stockland Trust Group............... 404
186 Westfield Trust..................... 357
--------
1,062
--------
Retail-Stores/Catalog (0.1%):
102 Coles Myer Ltd...................... 398
--------
Services (0.1%):
18 Brambles Industries Ltd............. 351
--------
Total Australia..................... 9,881
--------
AUSTRIA (1.7%):
Airlines (0.1%):
22 Austrian Airlines................... 708
--------
Automotive (0.0%):
7 Steyr-Daimler-Puch AG............... 178
--------
Banking & Finance (0.6%):
7 Bank Austria AG..................... 485
6 Bank Austria AG - Vorzug............ 463
30 Bank Austria AG, Participating
Certificates...................... 2,450
--------
3,398
--------
Beverages & Tobacco (0.0%):
4 Osterreichische Brau-Beteiligungs
AG................................ 233
--------
Building Products (0.1%):
2 Wienerberger Baustoffindustrie AG... 575
--------
Chemicals (0.0%):
4 Lenzing AG (b)...................... 309
--------
Electrical Equipment (0.0%):
1 Austria Mikro Systeme
International..................... 68
--------
Engineering (0.1%):
4 VA Technologie AG................... 535
--------
Environmental Services (0.1%):
2 BWT AG.............................. 382
--------
Continued
64
168
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
AUSTRIA, CONTINUED:
Insurance (0.1%):
3 EA-Generali AG...................... $ 837
--------
Miscellaneous Materials & Commodities (0.1%):
9 Radex-Heraklith
Industriebeteiligungs AG.......... 434
--------
Oil & Gas Exploration, Production & Services (0.2%):
8 OMV AG.............................. 1,118
--------
Paper Products (0.0%):
1 Mayr-Melnhof Karton AG.............. 78
--------
Telecommunications -- Services and Equipment (0.3%):
11 Osterreichische
Elekrizitatswirtschafts-AG, Class
A................................. 1,275
--------
Transportation (0.0%):
5 Flughafen Wien AG................... 233
--------
Total Austria....................... 10,361
--------
BELGIUM (2.0%):
Banking (0.6%):
2 Generale de Banque SA............... 1,359
27 Kredietbank NV...................... 2,439
13 Kredietbank Strip................... 1
--------
3,799
--------
Chemicals (0.2%):
14 Solvay SA........................... 1,073
--------
Industrial Holding Company (0.1%):
4 Groupe Bruxelles Lambert SA......... 831
--------
Insurance (0.3%):
4 Fortis AG........................... 1,126
2 Royale Belge........................ 718
--------
1,844
--------
Merchandising (0.2%):
14 Delhaize-Le Lion SA................. 985
--------
Metals & Mining (0.0%):
3 Union Miniere Group................. 185
--------
Oil & Gas Exploration, Production & Services (0.2%):
3 PetroFina SA........................ 1,055
--------
Telecommunications -- Services and Equipment (0.4%):
9 Electrabel SA....................... 2,615
--------
Total Belgium....................... 12,387
--------
BRAZIL (0.2%):
Auto Parts (0.0%):
8 Marcopolo SA........................ 14
--------
Banking (0.0%):
800 Banco do Estado De SA............... 38
2,000 Uniao de Bancos Brasileir........... 48
--------
86
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
BRAZIL, CONTINUED:
Beverages & Tobacco (0.0%):
41 Companhia Cervejaria Brahma......... $ 23
--------
Chemicals (0.0%):
242 Copesul -- Companhia Pertoquimica do
Sul............................... 8
19 White Martins SA.................... 18
--------
26
--------
Electric Utility (0.0%):
8,991 Gerasul (b)......................... 12
--------
Gaming (0.0%):
5 Companhia Vidraria Santa Maria...... 8
--------
Gas & Electric Utility (0.2%):
8,991 Centrais Electricas Brasileiras
SA................................ 260
1,712 Centrais Electricas Brasileiras SA,
Class B........................... 52
4,116 Companhia Paranaense de Energia-
Copel (b)......................... 32
363 Light -- Servicos de Eletricidade
SA................................ 116
--------
460
--------
Steel (0.0%):
3,589 Companhia Siderurgica Nacional...... 86
4 Companhia Vale do Rio Doce (b)...... 76
--------
162
--------
Telecommunications (0.0%):
1,865 Telecomunicacoes Brasileiras SA..... 149
193 Telecomunicacoes de Sao Paulo SA
(b)............................... 29
441 Telesp Celular B (b)................ 37
193 Telesp Celular SA (b)............... 8
--------
223
--------
Tobacco (0.0%):
26 Souza Cruz SA....................... 191
--------
Total Brazil........................ 1,205
--------
CHILE (0.4%):
Banking & Finance (0.0%):
6 Banco de Santiago ADR............... 99
--------
Beverages & Tobacco (0.1%):
11 Embotelladora Andina SA ADR......... 177
7 Embotelladora Andina SA, Series A
ADR............................... 120
3 Vina Concho y Toro SA ADR........... 86
--------
383
--------
Chemicals (0.0%):
6 Quimica Y Minera Chile SA ADR....... 215
--------
Electric Utility (0.0%):
15 Gener SA ADR........................ 266
--------
Continued
65
169
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
CHILE, CONTINUED:
Forest Products (0.0%):
12 Maderas Y Sinteticos Anonima SA
ADR............................... $ 97
--------
Gas & Electric Utility (0.2%):
12 Chilectra SA ADR.................... 250
18 Enersis SA ADR...................... 447
--------
697
--------
Metals & Mining (0.0%):
12 Madeco SA ADR....................... 107
--------
Packaging (0.0%):
9 Cristalerias de Chile ADR........... 111
--------
Pharmaceutical (0.0%):
5 Laboratorio Chile ADR............... 68
--------
Telecommunications (0.1%):
27 Telecomunicaciones de Chile SA
ADR............................... 544
--------
Total Chile......................... 2,587
--------
DENMARK (1.4%):
Agriculture (0.0%):
3 Korn-OG Foderstof Kompagniet A/S.... 70
--------
Banking & Finance (0.2%):
7 Danske Bank......................... 870
7 Unidanmark A/S, Class A............. 593
--------
1,463
--------
Beverages & Tobacco (0.1%):
4 Carlsberg A/S, Class A.............. 258
7 Carlsberg A/S, Class B.............. 531
--------
789
--------
Commercial Services (0.0%):
4 ISS International Service System
A/S, Class B...................... 215
--------
Diversified (0.1%):
14 Superfos A/S........................ 370
--------
Electronics (0.0%):
2 Bang & Olufsen Holding.............. 133
--------
Engineering (0.0%):
7 FLS Industries A/S B................ 187
--------
Food Products & Services (0.1%):
9 Danisco A/S......................... 631
--------
Pharmaceuticals (0.3%):
11 Novo Nordisk A/S, Class B........... 1,571
--------
Telecommunications (0.3%):
19 Tele Danmark A/S, Class B........... 1,810
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
DENMARK, CONTINUED:
Transportation & Shipping (0.3%):
0 D/S 1912, Class B (e)............... $ 729
0 D/S Svendborg A/S, Class B (e)...... 904
0 Lauritzen (J.) Holding A/S (e)...... 30
5 SAS Danmark A/S..................... 94
--------
1,757
--------
Total Denmark....................... 8,996
--------
FINLAND (1.1%):
Banking & Finance (0.1%):
96 Merita Ltd., Class A................ 632
--------
Forest Products (0.1%):
27 UPM-Kymmene Corp.................... 748
--------
Health Care (0.0%):
2 Instrumentarium Group, Series A..... 120
--------
Insurance (0.1%):
5 Pohjola Insurance Group, Class B.... 239
8 Sampo Insurance Co.................. 379
--------
618
--------
Metals (0.0%):
24 Outokumpo OY, Class A............... 300
--------
Telecommunications (0.8%):
43 Nokia Oyj, Class A.................. 3,170
16 Nokia Oyj, Class K.................. 1,163
--------
4,333
--------
Total Finland....................... 6,751
--------
FRANCE (11.7%):
Automotive (0.2%):
6 PSA Peugeot......................... 1,355
--------
Banking (1.0%):
24 Banque Nationale de Paris........... 1,957
18 Paribas............................. 1,937
11 Societe Generale.................... 2,219
--------
6,113
--------
Beverages & Tobacco (0.4%):
10 LVMH (Moet Hennessy Louis
Vuitton).......................... 1,909
8 Pernod Ricard....................... 563
--------
2,472
--------
Broadcasting/Cable (0.1%):
4 Canal Plus.......................... 673
--------
Building Products (0.3%):
3 Imetal SA........................... 392
15 Lafarge SA.......................... 1,577
--------
1,969
--------
Continued
66
170
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
FRANCE, CONTINUED:
Business Service (0.7%):
20 Compagnie Generale des Eaux......... $ 4,357
0 Havas SA (c)(e)..................... 0
--------
4,357
--------
Chemicals (0.6%):
11 L'Air Liquide....................... 1,800
40 Rhone-Poulenc SA.................... 2,239
--------
4,039
--------
Commercial Services (0.2%):
1 Addeco SA........................... 266
5 Sodexho SA.......................... 983
--------
1,249
--------
Construction (0.1%):
4 Bouygues............................ 763
--------
Defense (0.2%):
1 Sagem SA (c)........................ 506
18 Thomson CSF (c)..................... 671
--------
1,177
--------
Diversified (0.1%):
15 Lagardere SCA....................... 620
--------
Electrical & Electronic (1.0%):
18 Alcatel Alsthom..................... 3,688
4 Legrand SA.......................... 1,178
17 Schneider SA........................ 1,343
--------
6,209
--------
Energy (1.2%):
30 Elf Aquitane SA..................... 4,254
28 Total SA, Class B................... 3,666
--------
7,920
--------
Engineering (0.1%):
4 Compagnie Francaise d'Etudes et de
Construction Technip.............. 458
--------
Food & Household Products (0.2%):
4 Eridania Beghin-Say SA.............. 983
--------
Food Products & Services (0.4%):
8 Groupe Danone....................... 2,293
--------
Health & Personal Care (0.9%):
7 L'OREAL............................. 4,106
12 Sanofi SA........................... 1,354
--------
5,460
--------
Industrial Goods & Services (0.2%):
17 Michelin Class B, Registered........ 1,002
--------
Industrial Holding Company (0.5%):
17 Lyonnaise des Eaux SA............... 2,844
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
FRANCE, CONTINUED:Insurance (0.7%):
36 AXA SA.............................. $ 4,085
--------
Leisure (0.2%):
4 Accor SA............................ 1,217
--------
Media (0.0%):
1 Pathe SA............................ 282
--------
Merchandising (1.0%):
4 Carrefour SA........................ 2,687
8 Etablissements Economiques du Casino
Guichard-Perrachon................ 664
3 Pinault-Printemps-Redoute SA........ 2,230
2 Promodes............................ 1,216
--------
6,797
--------
Office Equipment & Services (0.1%):
9 BIC................................. 654
--------
Oil & Gas (0.3%):
10 Compagnie de Saint Gobain........... 1,845
--------
Telecommunications -- Services and Equipment (1.0%):
89 France Telecom (c).................. 6,111
--------
Textile Products (0.0%):
2 Dollfus-Mieg & Cie (b).............. 65
--------
Total France........................ 73,012
--------
GERMANY (16.9%):
Airlines (0.2%):
54 Lufthansa AG........................ 1,354
--------
Automotive (1.9%):
73 Daimler-Benz AG (c)................. 7,206
2 Man AG.............................. 661
4 Volkswagen AG....................... 4,263
--------
12,130
--------
Banking (2.9%):
101 Bayer AG............................ 5,212
43 Bayerische Vereinsbank AG........... 3,690
74 Deutsche Bank AG.................... 6,272
71 Dresdner Bank AG.................... 3,804
--------
18,978
--------
Banking & Finance (0.4%):
38 Bayerische Hypotheken-und Wechsel-
Bank AG (c)....................... 2,422
--------
Building Products (0.1%):
8 Heidelberger Zement AG.............. 732
--------
Business Service (0.8%):
9 SAP AG.............................. 5,247
--------
Continued
67
171
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
GERMANY, CONTINUED:
Chemicals (0.8%):
87 BASF AG............................. $ 4,122
15 Degussa AG.......................... 948
--------
5,070
--------
Conglomerates (1.6%):
32 Metro AG (c)........................ 1,936
3 Preussag AG......................... 992
70 VEBA AG............................. 4,794
4 Viag AG............................. 2,568
--------
10,290
--------
Construction (0.1%):
9 Hochtief AG......................... 445
--------
Consumer Goods & Services (0.2%):
7 Adidas AG (c)....................... 1,136
--------
Electrical & Electronic (0.8%):
79 Siemens AG.......................... 4,777
--------
Engineering (1.0%):
10 AGIV AG............................. 286
6 Bilfinger & Berger Bau AG........... 200
55 Mannesmann AG....................... 5,559
--------
6,045
--------
Health Care (0.2%):
11 Schering AG......................... 1,253
--------
Industrial Goods & Services (0.1%):
3 Carbon AG........................... 348
--------
Insurance (3.0%):
33 Allianz AG.......................... 10,955
1 Allianz AG (b)...................... 286
6 AMB Aachener und Muenchener
Beteiligungs...................... 675
2 AMB Aachener und Muenchener
Beteiligungs AG................... 223
4 CKAG Colonia Konzern AG............. 467
1 Muenchener Rueckversicherungs
Gesellschaft AG, Bearer Shares.... 250
11 Muenchener Rueckversicherungs
Gesellschaft AG, Registered
Shares............................ 5,598
--------
18,454
--------
Investment Company (0.2%):
17 Beiersdorf AG....................... 1,064
--------
Machinery & Equipment (0.2%):
9 Kloeckner-Humbolt-Deutz AG (b)...... 105
1 Linde AG............................ 890
--------
995
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
GERMANY, CONTINUED:
Metals & Mining (0.2%):
9 Kugelfischer Georg Schaefer AG...... $ 138
5 Thyssen AG.......................... 1,250
--------
1,388
--------
Pharmaceuticals (0.2%):
25 Merck KGaA.......................... 1,098
--------
Retail (0.1%):
1 Karstadt AG (c)..................... 609
--------
Retail -- General Merchandise (0.0%):
5 Douglas Holding AG.................. 277
--------
Telecommunications (1.4%):
315 Deutsche Telekom AG (c)............. 8,485
--------
Telecommunications -- Services and Equipment (0.5%):
48 RWE AG.............................. 2,842
--------
Total Germany....................... 105,439
--------
GREECE (0.9%):
Agriculture (0.0%):
10 Hellenic Sugar Industry SA.......... 100
--------
Appliances & Household Products (0.0%):
2 Fourlis Brothers Corp............... 28
--------
Banking & Finance (0.4%):
9 Alpha Credit Bank................... 702
5 Commercial Bank of Greece SA........ 406
6 Ergo Bank SA........................ 489
5 National Bank of Greece SA.......... 667
--------
2,264
--------
Beverages & Tobacco (0.1%):
24 Hellenic Bottling Co. SA............ 736
--------
Building Products (0.1%):
14 Heracles General Cement Co. SA...... 335
2 Titan Cement Co..................... 148
--------
483
--------
Health Care (0.0%):
7 Athens Medical Care................. 130
--------
Insurance (0.0%):
5 Aspis Pronia (b).................... 64
--------
Miscellaneous Materials & Commodities (0.0%):
0 Silver & Baryte Ores Mining (e)..... 15
--------
Telecommunications (0.3%):
65 Hellenic Telecommunication
Organization...................... 1,674
2 Intracom SA......................... 73
--------
1,747
--------
Continued
68
172
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
GREECE, CONTINUED:
Textile Products (0.0%):
5 El. D. Mouzakis SA.................. $ 14
--------
Tobacco (0.0%):
4 Papastratos Cigarette............... 89
--------
Transportation & Shipping (0.0%):
8 Attica Enterprises.................. 117
--------
Total Greece........................ 5,787
--------
HONG KONG (0.5%):
Airlines (0.0%):
194 Cathay Pacific Airways.............. 136
--------
Banking (0.1%):
83 Bank of East Asia Ltd. (b).......... 90
16 HSBC Holdings PLC................... 382
--------
472
--------
Banking & Finance (0.0%):
38 Wing Lung Bank...................... 88
--------
Broadcasting & Publishing (0.0%):
95 Television Broadcasts Ltd........... 251
--------
Conglomerates (0.0%):
68 Swire Pacific Ltd., Class A......... 257
--------
Electrical Equipment (0.0%):
645 Elec & Eltek International Holdings
Ltd............................... 123
--------
Industrial Holding Company (0.2%):
145 Hutchison Whampoa Ltd............... 766
--------
Printing & Publishing (0.0%):
263 Oriental Press Group Ltd............ 24
--------
Real Estate (0.0%):
59 Sun Hung Kai Properties Ltd......... 251
--------
Telecommunications (0.2%):
391 Hong Kong Telecommunications Ltd.... 733
--------
Total Hong Kong..................... 3,101
--------
INDIA (0.5%):
Aluminum (0.0%):
16 Indian Aluminum Company Ltd. GDR
(b)............................... 23
--------
Automotive (0.1%):
45 Mahindra & Mahindra Ltd. GDR (b).... 192
44 Tata Engineering & Locomotive Co.,
Ltd. GDR.......................... 140
--------
332
--------
Building Products (0.0%):
22 Gujarat Ambuja Cements Ltd. GDR..... 110
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
INDIA, CONTINUED:
Chemicals (0.0%):
10 Indian Petrochemicals Corp., Ltd.
GDR............................... $ 30
95 Indo Gulf Fertilizers and Chemicals
Corp., Ltd. GDR................... 69
7 United Phosphorus Ltd. GDR.......... 18
--------
117
--------
Diversified (0.2%):
17 Grasim Industries Ltd. GDR.......... 111
35 ITC Ltd. GDR........................ 574
--------
685
--------
Hotels & Lodging (0.0%):
13 East India Hotels Ltd. GDR.......... 60
13 Indian Hotels Co., Ltd. GDR (b)..... 100
--------
160
--------
Manufacturing -- Capital Goods (0.0%):
30 Ashok Leyland Ltd. GDR.............. 65
38 India Cements Ltd. GDR.............. 51
18 Larsen & Toubro Ltd. GDR............ 172
--------
288
--------
Metals & Mining (0.0%):
20 Steel Authority of India Ltd. GDR... 50
--------
Pharmaceuticals (0.0%):
13 Ranbaxy Laboratories Ltd. GDR....... 202
--------
Textile Products (0.2%):
59 Arvind Mills Ltd. GDR............... 52
22 Bombay Dye & Manufacturing Co. GDR.. 33
70 Century Textile & Industries Ltd.
GDR............................... 74
21 Indian Rayon & Industries Ltd.
GDR............................... 69
8 Raymond Ltd. GDR.................... 21
59 Reliance Industries Ltd. GDR........ 388
--------
637
--------
Transportation (0.0%):
20 Bajaj Auto Ltd. GDR................. 256
--------
Transportation -- Shipping (0.0%):
21 Great Eastern Shipping Co. GDR...... 77
--------
Total India......................... 2,937
--------
IRELAND (0.5%):
Banking & Finance (0.4%):
170 Allied Irish Banks PLC.............. 2,452
--------
Beverages & Tobacco (0.0%):
77 James Crean PLC..................... 168
--------
Industrial Goods & Services (0.1%):
133 Smufit (Jefferson) Group............ 395
--------
Continued
69
173
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
IRELAND, CONTINUED:
Media (0.0%):
34 Independent Newspapers PLC.......... $ 180
--------
Total Ireland....................... 3,195
--------
ISRAEL (0.7%):
Agriculture (0.0%):
0 Mehadrin Ltd. (e)................... 15
--------
Banking (0.2%):
253 Bank Hapoalim Ltd. (b).............. 765
80 First International Bank of Israel
(1)............................... 125
20 First International Bank of Israel
(5)............................... 156
--------
1,046
--------
Chemicals (0.0%):
166 Israel Chemicals Ltd................ 211
--------
Computer Hardware (0.0%):
8 Scitex Corp., Ltd. (b).............. 102
--------
Computer Software (0.0%):
2 New Dimension Software Ltd. (b)..... 81
--------
Construction (0.0%):
55 Industrial Buildings Corp........... 92
--------
Diversified (0.1%):
6 Elco Holdings Ltd................... 31
5 IDB Holding Corp., Ltd.............. 128
1 Israel Corp., Ltd. (b).............. 47
7 Israel Land Development ADR (b)..... 132
--------
338
--------
Food Products & Services (0.1%):
8 Osem Investment Ltd................. 41
4 Super-Sol Ltd....................... 14
18 Super-Sol Ltd. ADR.................. 297
--------
352
--------
Insurance (0.0%):
9 Clal Insurance Enterprise
Holdings.......................... 93
--------
Investment Company (0.0%):
23 Makhteshim Agan Industries (b)...... 74
--------
Machinery & Equipment (0.0%):
15 Ormat Industries Ltd................ 20
--------
Materials (0.0%):
3 Israel Petrochemical Enterprises.... 14
--------
Oil & Gas (0.0%):
2 Delek Israel Fuel Corp., Ltd........ 88
--------
Paper Products (0.0%):
0 American Israeli Paper Mills (e).... 12
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
ISRAEL, CONTINUED:
Pharmaceuticals (0.1%):
5 Agis Industries Ltd. (b)............ $ 34
11 Teva Pharmaceutical ADR............. 394
--------
428
--------
Real Estate (0.0%):
0 Africa-Israel Investments Ltd.
(b)(e)............................ 17
4 Azorim Investments Development &
Construction...................... 29
11 Jerusalem Economic Corp., Ltd....... 57
1 Property & Building Corp., Ltd...... 73
--------
176
--------
Telecommunications (0.1%):
135 Bezeq Israeli Telecom Co............ 432
16 Koor Industries ADR................. 369
--------
801
--------
Telecommunications -- Equipment (0.1%):
15 ECI Telecommunications.............. 549
1 Gilat Satellite Networks Ltd. (b)... 37
2 Teledata Communications Ltd. (b).... 21
--------
607
--------
Total Israel........................ 4,550
--------
ITALY (10.7%):
Agriculture (0.1%):
306 Parmalat Finanziaria SpA (c)........ 624
--------
Auto Parts (0.0%):
90 Magneti Marelli SpA................. 197
--------
Automotive (0.6%):
754 Fiat SpA (c)........................ 3,299
179 Fiat SpA di Risp (Non-convertible)
(c)............................... 443
--------
3,742
--------
Banking (1.6%):
378 Banca Commerciale Italiana.......... 2,260
58 Banca Popolare di Milano (c)........ 464
315 Banco Ambrosiano Veneto SpA (c)..... 1,763
585 Credito Italiano SpA (c)............ 3,061
163 Istituto Bancario San Paolo di
Torino............................ 2,352
34 Riunione Adriatica di Sicurta SpA di
Risp.............................. 305
--------
10,205
--------
Banking & Finance (0.2%):
114 Mediobanca SpA...................... 1,449
--------
Broadcasting & Publishing (0.3%):
249 Mediaset SpA (c).................... 1,587
--------
Continued
70
174
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
ITALY, CONTINUED:
Building Products (0.1%):
32 Italcementi SpA..................... $ 289
15 Italcementi SpA RNC................. 66
--------
355
--------
Chemicals (0.2%):
998 Montedison SpA (c).................. 1,238
119 Montedison SpA di Risp.............. 92
130 Snia MPD SpA........................ 159
--------
1,489
--------
Engineering (0.0%):
145 Impregilo SpA....................... 128
--------
Financial Services (0.3%):
125 Istituto Mobiliare Italiano (c)..... 1,975
--------
Financial -- Banking (0.1%):
123 Banca Intesa SpA RNC................ 363
--------
Gas & Electric Utility (0.3%):
129 Edison SpA (c)...................... 1,032
144 Italgas SpA......................... 587
--------
1,619
--------
Insurance (1.8%):
210 Assicurazioni Generali.............. 6,836
789 Istituto Nazionale delle
Assicurazioni (c)................. 2,243
52 Milano Assicurazioni (b)(c)......... 201
84 Riuniune Adriatici de Sicurta SpA... 1,088
63 Societa Assicuratrice Industriale
(SAI) SpA......................... 802
--------
11,170
--------
Jewelry (0.0%):
54 Bulgari SpA......................... 281
--------
Office Equipment & Services (0.1%):
541 Olivetti SpA (b)(c)................. 805
--------
Oil & Gas (1.7%):
1,619 Ente Nazionale Idrocarburi SpA
(ENI)............................. 10,608
--------
Paper Products (0.1%):
34 Burgo (Cartiere) SpA................ 271
17 Reno de Medici SpA (b).............. 59
--------
330
--------
Printing & Publishing (0.1%):
28 Mandadori........................... 333
--------
Retail (0.1%):
39 La Rinascente SpA................... 384
--------
Steel (0.0%):
29 Falck Acciaierie & Ferriere Lombarde
SpA............................... 186
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
ITALY, CONTINUED:
Telecommunications (2.6%):
56 Sirti SpA........................... $ 303
1,362 Telecom Italia Mobile SpA di Risp
(Non-convertible) (b)............. 8,331
357 Telecom Italia SpA.................. 1,203
773 Telecom Italia SpA (c).............. 5,688
213 Telecom Italia SpA RNC.............. 1,030
--------
16,555
--------
Textile Products (0.2%):
359 Benetton Group SpA (c).............. 746
13 Marzotto (Gaetano) & Figli SpA...... 200
--------
946
--------
Tire & Rubber (0.2%):
373 Pirelli SpA (c)..................... 1,166
--------
Total Italy......................... 66,497
--------
JAPAN (17.5%):
Agriculture (0.0%):
25 Nippon Beet Sugar Manufacturing..... 35
--------
Airlines (0.1%):
115 Japan Airlines (b)(c)............... 320
--------
Aluminum (0.0%):
74 Nippon Light Metal Co............... 85
--------
Appliances & Household Products (1.1%):
164 Matsushita Electric Industrial Co.,
Ltd. (c).......................... 2,635
12 Pioneer Electronic Corp............. 229
136 Sanyo Electric Co................... 412
81 Sharp Corp. (c)..................... 656
31 Sony Corp. (c)...................... 2,669
--------
6,601
--------
Automotive (1.7%):
3 Autobacs Seven Co................... 86
72 Honda Motor Co., Ltd................ 2,562
159 Nissan Motor Co., Ltd. (c).......... 501
12 Sanden.............................. 81
23 Toyoda Automatic Loom Works (c)..... 406
289 Toyota Motor Corp................... 7,475
--------
11,111
--------
Banking (1.7%):
143 Asahi Bank Ltd. (c)................. 629
363 Bank of Tokyo-Mitsubishi (c)........ 3,837
211 Fuji Bank Ltd. (c).................. 941
175 Industrial Bank of Japan (c)........ 1,097
135 Mitsui Trust & Banking Co. (c)...... 318
304 Sakura Bank Ltd. (c)................ 789
244 Sumitomo Bank (c)................... 2,373
Continued
71
175
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Banking, continued:
136 Tokai Bank (c)...................... $ 749
26 Yamaguchi Bank...................... 333
--------
11,066
--------
Basic Industry (0.0%):
42 Sekisui Chemical Co., Ltd........... 215
--------
Beverages & Tobacco (0.2%):
35 Asahi Breweries Ltd. (c)............ 441
74 Kirin Brewery Co., Ltd.............. 699
36 Takara Shuzo........................ 149
--------
1,289
--------
Brewery (0.0%):
18 Sapporo Breweries................... 69
--------
Broadcasting & Publishing (0.0%):
18 Tokyo Broadcasting System........... 201
--------
Building Products (0.1%):
35 Chichibu Onoda Cement Co. (c)....... 63
7 Dianippon Screen Manufacturing Co.,
Ltd............................... 29
48 Nihon Cement Co., Ltd............... 96
32 Sanwa Shutter Corp.................. 141
19 Tostem Corp......................... 246
--------
575
--------
Chemicals (0.8%):
89 Asahi Chemical Industry Co., Ltd.... 321
32 Daicel Chemical Industries Ltd...... 68
49 Dainippon Ink & Chemicals, Inc...... 150
97 Denki Kagaku Kogyo K.K.............. 157
26 Ishihara Sangyo Kaisha (b).......... 36
32 Kaneka Corp......................... 168
24 Konica Corp......................... 108
13 Kureha Chemical Industry............ 30
119 Mitsubishi Chemical Corp. (c)....... 215
28 Mitsubishi Gas Chemical Co.......... 85
14 Nippon Shokubai K.K. Co............. 75
22 NOF Corp............................ 40
27 Shin-Etsu Chemical Co............... 474
70 Showa Denko K.K..................... 71
112 Sumitomo Chemical Co. (c)........... 345
65 Takeda Chemical Industries.......... 1,727
94 Toray Industries, Inc............... 488
72 Tosoh Corp.......................... 125
74 Ube Industries Ltd.................. 96
--------
4,779
--------
Commercial Services (0.0%):
3 Oyo Corp............................ 40
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Computer Software (0.0%):
4 CSK Corp............................ $ 79
3 Konami Co., Ltd..................... 65
--------
144
--------
Construction (0.2%):
26 Aoki Corp. (b)(c)................... 13
21 Daikyo, Inc. (b) (c)................ 24
37 Daiwa House Industry Co., Ltd....... 327
38 Haseko Corp. (b).................... 22
56 Kumagai Gumi Co., Ltd. (b)(c)....... 40
12 Misawa Homes (c).................... 33
18 Okumura Corp........................ 63
28 Penta-Ocean Construction Co.,
Ltd............................... 65
61 Sekisui House Ltd................... 472
59 Shimizu Corp. (c)................... 170
--------
1,229
--------
Consumer Goods & Services (0.1%):
35 Nippon Sheet Glass Co., Ltd......... 55
76 Renown, Inc. (b).................... 56
10 Shimano, Inc........................ 254
14 Tokyo Style Co., Ltd................ 137
50 Toto Ltd............................ 301
--------
803
--------
Cosmetics/Personal Care (0.1%):
29 Shisiedo Co., Ltd................... 329
--------
Data Processing & Reproduction (0.2%):
139 Fujitsu Ltd. (c).................... 1,462
2 Trans Cosmos, Inc................... 48
--------
1,510
--------
Distribution (0.1%):
164 Itochu Corp......................... 355
--------
Diversified (0.1%):
9 Amano Corp.......................... 79
7 Sanrio Co., Ltd. (b)................ 83
18 Yamaha Corp......................... 176
--------
338
--------
Electrical & Electronic (0.4%):
15 Casio Computer Co., Ltd............. 139
14 Kyocera Corp........................ 684
141 Mitsubishi Electric Corp............ 324
26 Nikon Corp.......................... 187
17 Omron Corp.......................... 260
10 Rohm Co............................. 1,027
--------
2,621
--------
Continued
72
176
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Electrical Equipment (0.1%):
12 Alps Electric Co., Ltd.............. $ 143
5 SMC Corp. (c)....................... 403
8 Taiyo Yuden Co., Ltd................ 85
--------
631
--------
Electronic Components/Instruments (0.7%):
7 Adventest Corp...................... 398
22 Fanuc Co., Ltd...................... 771
3 Hirose Electric 151
244 Hitachi Ltd. (c).................... 1,591
117 NEC Corp. (c)....................... 1,090
23 Yokogawa Electric Corp.............. 123
--------
4,124
--------
Electronics (0.0%):
9 Nitto Denko Corp. (c)............... 135
--------
Energy (0.1%):
169 Japan Energy Corp................... 179
110 Nippon Oil Co....................... 355
--------
534
--------
Engineering (0.2%):
13 Daito Trust Construction Co.,
Ltd............................... 98
36 Fujita Corp. (b) (c)................ 20
33 Hazama Corp. (b) (c)................ 19
49 Kajima Corp. (c).................... 134
10 Kandenko Co., Ltd................... 62
92 Kawasaki Heavy Industries........... 186
19 Kinden Corp......................... 228
19 Nishimatsu Construction............. 93
53 Obayashi Corp. (c).................. 225
17 Sato Kogyo.......................... 14
17 Toa Corp............................ 25
24 Toyo Engineering.................... 32
--------
1,136
--------
Entertainment (0.0%):
13 Toei................................ 41
1 Toho Co............................. 116
20 Tokyo Dome Corp..................... 108
--------
265
--------
Financial Services (0.7%):
18 Acom Co., Ltd....................... 855
108 Mitsubishi Trust & Banking Co.
(c)............................... 917
154 Nomura Securities Co. (c)........... 1,792
6 Orix Corp........................... 405
5 Uni-Charm........................... 178
--------
4,147
--------
Financial -- Banking (0.1%):
49 77th Bank Ltd. (c).................. 410
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Food & Household Products (0.2%):
42 Ajinomoto Co., Inc.................. $ 368
47 Kao Corp. (c)....................... 725
14 Nippon Meat Packers, Inc............ 171
10 Nissin Food Products................ 179
--------
1,443
--------
Food Products & Services (0.1%):
59 Daiei, Inc. (c)..................... 138
17 Kikkoman Corp....................... 89
27 Meiji Milk Products Co., Ltd........ 72
49 Nichirei Corp....................... 101
45 Nippon Suisan Kaisha Ltd. (b)....... 52
22 Yamazaki Baking Co., Ltd............ 195
--------
647
--------
Forest Products (0.2%):
38 Mitsubishi Paper Mills.............. 74
115 New Oji Paper Co. (c)............... 502
70 Nippon Paper Industries Co.......... 292
17 Sumitomo Forestry Co., Ltd.......... 95
--------
963
--------
Gas & Electric Utility (0.8%):
84 Kansai Electric Power Co., Inc...... 1,453
184 Osaka Gas Co........................ 472
48 Tohoku Electric Power............... 710
106 Tokyo Electric Power................ 2,070
204 Tokyo Gas Co., Ltd. (c)............. 454
--------
5,159
--------
Health & Personal Care (0.3%):
15 Chugai Pharmaceutical Co., Ltd...... 98
29 Kyowa Hakko Kogyo Co., Ltd.......... 115
21 Lion Corp........................... 71
34 Sankyo Co., Ltd..................... 774
44 Yamanouchi Pharmaceutical Co., Ltd.
(c)............................... 917
--------
1,975
--------
Hotels & Lodging (0.0%):
11 Fujita Kanko, Inc................... 90
--------
Industrial Goods & Services (0.6%):
59 Bridgestone Corp. (c)............... 1,393
64 Denso Corp. (c)..................... 1,061
75 Mitsui Engineering & Shipbuilding
Co., Ltd. (b)(c).................. 57
36 NGK Insulators Ltd.................. 313
18 NGK Spark Plug Co................... 153
52 Sumitomo Electric Industries........ 526
--------
3,503
--------
Continued
73
177
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Insurance (0.4%):
69 Mitsui Marine & Fire Insurance Co.,
Ltd............................... $ 347
41 Nichido Fire & Marine Insurance Co.,
Ltd............................... 212
45 Nippon Fire & Marine Insurance...... 184
58 Sumitomo Marine & Fire Insurance.... 324
122 Tokio Marine & Fire Insurance Co.... 1,254
--------
2,321
--------
Jewelry (0.1%):
40 Citizen Watch Co., Ltd.............. 330
9 Hoya Corp........................... 255
--------
585
--------
Leasing (0.1%):
45 Yamato Transport Co., Ltd. (c)...... 504
--------
Leisure (0.0%):
3 Namco (c)........................... 72
--------
Machinery & Equipment (0.6%):
18 Amada Co., Ltd...................... 88
25 Brother Industries Ltd.............. 93
45 Chiyoda Corp. (b)................... 55
14 Daifuku Co., Ltd.................... 52
18 Daikin Industries Ltd............... 116
14 Ebara Corp.......................... 124
61 Komatsu Ltd......................... 296
5 Komori Corp......................... 95
40 Koyo Seiko Co., Ltd................. 149
94 Kubota Corp......................... 217
9 Kurita Water........................ 106
6 Makino Milling Machine (c).......... 42
32 Minebea Co., Ltd.................... 318
232 Mitsubishi Heavy Industries, Ltd.... 877
6 Mori Seiki.......................... 73
58 Nigata Engineering Co., Ltd. (b).... 39
77 NSK Ltd............................. 313
49 NTN Corp............................ 154
20 Okuma Corp.......................... 91
34 Sumitomo Heavy Industries Ltd....... 78
5 Takuma Co., Ltd..................... 36
13 Tokyo Electron Ltd.................. 390
15 Tsubakimoto Chain................... 50
--------
3,852
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Manufacturing -- Capital Goods (0.2%):
27 Fujikura Ltd. (c)................... $ 120
16 Kokuyo Co., Ltd..................... 271
21 Makita Corp......................... 242
18 Murata Manufacturing Co., Ltd....... 583
10 Nippon Sharyo Ltd................... 24
22 Noritake Co., Ltd................... 103
--------
1,343
--------
Manufacturing -- Consumer Goods (0.5%):
65 Canon, Inc. (c)..................... 1,475
37 Fuji Photo Film Co., Ltd. (c)....... 1,288
6 Sega Enterprises.................... 104
--------
2,867
--------
Materials (0.0%):
9 Okamoto Industries, Inc............. 20
34 Sumitomo Osaka Cement Co., Ltd...... 44
--------
64
--------
Medical Supplies (0.0%):
24 Olympus Optical..................... 209
--------
Merchandising (0.4%):
31 ITO-Yokado Co., Ltd................. 1,458
23 JUSCO Co............................ 422
26 Marui Co., Ltd...................... 388
--------
2,268
--------
Metals & Mining (0.2%):
51 Furukawa Electric Co................ 172
73 Hitachi Zosen Corp.................. 118
66 Japan Steel Works (b)............... 81
78 Mitsubishi Materials Corp........... 159
33 Mitsui Mining & Smelting (c)........ 137
59 Mitsui Mining Co., Ltd. (b)......... 50
57 Seika Corp.......................... 88
39 Sumitomo Metal Mining Co. (c)....... 158
--------
963
--------
Office Equipment & Services (0.1%):
57 Dai Nippon Printing Co., Ltd........ 910
--------
Oil & Gas Exploration, Production & Services (0.1%):
9 Arabian Oil Co...................... 131
88 Asahi Glass Co., Ltd................ 475
61 Teikoku Oil Co...................... 189
--------
795
--------
Oil & Gas Transmission (0.0%):
75 Iwatani International Corp.......... 131
83 Mitsubishi Oil Co., Ltd. (b)........ 117
--------
248
--------
Continued
74
178
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Packaging (0.0%):
15 Toyo Seikan Kaisha.................. $ 183
--------
Pharmaceuticals (0.2%):
17 Dai-Ichi Pharmaceuticals............ 224
19 Eisai Co., Ltd...................... 259
40 Meiji Seika......................... 122
13 Shionogi & Co....................... 75
29 Taisho Pharmacuetical Co............ 541
--------
1,221
--------
Real Estate (0.2%):
98 Mitsubishi Estate Co. (c)........... 861
61 Mitsui Fudosan...................... 482
20 Tokyo Tatemono Co., Ltd. (b)........ 38
--------
1,381
--------
Restaurants (0.0%):
8 Skylark Co., Ltd.................... 79
--------
Retail (0.3%):
6 Aoyama Trading Co., Ltd............. 136
15 Credit Saison Co., Ltd. (c)......... 287
21 Daimura, Inc. (c)................... 55
12 Hankyu Department Stores............ 62
17 Isetan Co........................... 142
31 Mitsukoshi Ltd. (c)................. 89
52 Mycal Corp. (c)..................... 330
4 Shimachu Co......................... 66
26 Takashimaya Co...................... 196
13 Uny Co., Ltd........................ 211
--------
1,574
--------
Services (0.2%):
12 Secom 693
48 Toppan Printing Co., Ltd............ 513
--------
1,206
--------
Steel (0.4%):
67 Daido Steel Co., Ltd................ 120
53 Japan Metals & Chemicals (b) (c).... 75
246 Kawasaki Steel Corp................. 443
476 Nippon Steel Co. (c)................ 836
263 NKK Corp............................ 252
260 Sumitomo Metal Industries........... 418
18 Tokyo Steel......................... 93
--------
2,237
--------
Storage (0.0%):
14 Mitsubishi Logistics Corp........... 125
34 Mitsui-Soko Co., Ltd................ 102
--------
227
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
JAPAN, CONTINUED:
Telecommunications (1.3%):
10 Nippon Comsys Corp. (c)............. $ 115
1 Nippon Telegraph & Telephone
Corp.............................. 7,880
--------
7,995
--------
Textile Products (0.2%):
191 Kanebo Ltd. (b) (c)................. 158
53 Kurabo Industries................... 69
31 Kuraray Co., Ltd.................... 264
27 Mitsubishi Rayon Co., Ltd........... 75
33 Nisshinbo Industries................ 132
15 Onward Kashiyama Co., Ltd........... 188
56 Teijin Ltd.......................... 169
108 Toyobo Ltd.......................... 142
48 Unitika Ltd. (b).................... 36
--------
1,233
--------
Transportation & Shipping (0.3%):
0 East Japan Railway Co. (e).......... 1,334
30 Kamigumi Co., Ltd................... 125
93 Kawasaki Kisen Kaisha Ltd........... 161
81 Mitsui OSK Lines, Ltd............... 138
78 Nippon Yusen Kabushiki Kaisha (c)... 264
12 Seino Transportation................ 67
--------
2,089
--------
Transportation -- Road & Railroad (0.4%):
91 Hankyu Corp......................... 373
30 Keihin Electric Express Railway
(c)............................... 87
232 Kinki Nippon Railway (c)............ 1,088
62 Nippon Express Co., Ltd............. 332
48 Odakyu Electric Railway............. 147
57 Tobu Railway Co., Ltd............... 151
72 Tokyu Corp.......................... 218
--------
2,396
--------
Wholesale & International Trade (0.3%):
130 Marubeni Corp....................... 259
112 Mitsubishi Corp..................... 694
106 Mitsui & Co. (c).................... 573
58 Sumitomo Corp....................... 279
--------
1,805
--------
Wholesale Distribution (0.0%):
14 Nagase & Co......................... 51
--------
Wire & Cable Products (0.0%):
19 Tokyo Rope MFG...................... 24
--------
Total Japan......................... 109,579
--------
Continued
75
179
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
LUXEMBOURG (0.0%):
Aluminum (0.0%):
9 Hindalco Industries Co.............. $ 148
--------
MALAYSIA (0.2%):
Agriculture (0.0%):
118 Highlands & Lowlands Berhad......... 84
45 IOI Corp. Berhad.................... 22
--------
106
--------
Automotive (0.0%):
281 Tan Chong Motors.................... 51
--------
Building Products (0.0%):
10 Golden Plus Holdings................ 2
9 Jaya Tiasa Holdings Berhad.......... 11
198 Pan-Malaysia Cement Works Berhad.... 41
--------
54
--------
Construction (0.0%):
28 YTL Corp. Berhad.................... 21
--------
Diversified (0.0%):
24 Berjaya Group Berhad................ 3
231 Malaysian Mosaics Berhad............ 48
28 Mulph International................. 3
63 Multi-Purpose Holdings Berhad....... 16
--------
70
--------
Engineering (0.0%):
25 United Engineers (Malaysia) Ltd..... 10
--------
Financial Services (0.0%):
72 Malayan Banking Berhad.............. 72
40 MBF Capital Berhad.................. 7
69 Rashid Hussain Berhad............... 34
--------
113
--------
Food Products & Services (0.1%):
54 Nestle (Malaysia) Berhad............ 245
--------
Forest Products (0.0%):
376 Land & General Berhad............... 43
--------
Leisure (0.0%):
26 Berjaya Land Berhad................. 14
--------
Miscellaneous (0.0%):
290 Johan Holdings Berhad............... 32
--------
Real Estate (0.0%):
13 Malaysian Resources................. 3
--------
Steel (0.0%):
156 Malayawata Steel Berhad............. 38
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
MALAYSIA, CONTINUED:
Telecommunications (0.1%):
41 Technology Resources Industries
Berhad............................ $ 28
115 Tenaga Nasional Berhad.............. 139
--------
167
--------
Total Malaysia...................... 967
--------
MEXICO (0.6%):
Beverages & Tobacco (0.1%):
11 Compania Cervezas Unidas SA ADR..... 226
17 Grupo Continental SA................ 53
24 Grupo Modelo SA, Series C........... 199
--------
478
--------
Brewery (0.0%):
0 Fomento Economico Mexica UBD (e).... 6
--------
Building Products (0.0%):
10 Apasco SA de CV..................... 52
8 Cemex SA de CV, Series A............ 31
2 Cemex SA de CV, Series B............ 10
2 Cemex SA de CV, Series CPO.......... 9
2 Cemex SA, Series B.................. 2
7 Tolmex SA de CV, Series B2 (b)...... 31
3 Tubos de Acero de MexiCo............ 39
--------
174
--------
Diversified (0.1%):
32 ALFA SA de CV, Class A.............. 133
10 Carso Global Telecom, Series A-1.... 30
6 Desc SA de CV, Series A............. 27
10 Desc SA de CV, Series B............. 51
29 Grupo Carso SA de CV, Series A-1.... 117
--------
358
--------
Financial Services (0.0%):
35 Grupo Financiero Banamex Accival SA
de CV, Class B (b)................ 66
149 Grupo Financiero Bancomer (b)....... 55
14 Grupo Financiero Inbursa SA de CV,
Class B (b)....................... 22
--------
143
--------
Food & Household Products (0.0%):
85 Kimberly-Clark de Mexico SA de CV,
Class A........................... 295
--------
Food Products & Services (0.0%):
22 Empresas La Moderna SA de CV (b).... 127
--------
Industrial Goods & Services (0.0%):
76 Grupo Industrial Bimbo SA de CV,
Series A.......................... 151
--------
Continued
76
180
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
MEXICO, CONTINUED:
Merchandising (0.1%):
33 Cifra SA de CV, Series C............ $ 46
209 Cifra SA de CV, Series V............ 306
--------
352
--------
Metals & Mining (0.0%):
33 Grupo Mexico SA, Series B........... 91
25 Industrias Penoles SA, Series CP.... 79
--------
170
--------
Retail -- General Merchandise (0.0%):
39 Controladora Comercial Mexicana SA
de CV............................. 33
--------
Retail -- Stores/Catalog (0.0%):
70 El Puerto de Liverpool SA de CV,
Series 1.......................... 100
35 Grupo Elektra SA.................... 34
--------
134
--------
Steel (0.0%):
26 Altos Hornos de Mexico SA (b)....... 29
10 Hylsamex SA......................... 32
--------
61
--------
Telecommunications (0.3%):
12 Grupo Televisa SA, Series CPO (b)... 226
300 Telefonos de Mexico SA, Series L.... 715
--------
941
--------
Transportation -- Shipping (0.0%):
30 Vitro SA............................ 64
--------
Wholesale Distribution (0.0%):
15 Grupo Casa Autrey SA de CV.......... 10
--------
Total Mexico........................ 3,497
--------
NETHERLANDS (2.6%):
Appliances & Household Products (0.2%):
15 Philips Electronics NV.............. 1,299
--------
Banking (0.3%):
67 ABN Amro Holding NV................. 1,563
--------
Beverages & Tobacco (0.1%):
15 Heineken NV......................... 571
--------
Broadcasting & Publishing (0.1%):
43 Elsevier NV......................... 644
--------
Chemicals (0.2%):
4 Akzo Nobel.......................... 989
--------
Energy (0.8%):
86 Royal Dutch Petroleum............... 4,756
--------
Financial Services (0.4%):
39 ING Groep NV........................ 2,547
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
NETHERLANDS, CONTINUED:
Food Products & Services (0.3%):
27 Unilever NV CVA..................... $ 2,158
--------
Services (0.2%):
23 Koninklijke Royal PTT Nederland
NV................................ 866
23 TNT Post Group NV (b)............... 575
--------
1,441
--------
Total Netherlands................... 15,968
--------
NEW ZEALAND (0.2%):
Beverages & Tobacco (0.0%):
125 Lion Nathan Ltd..................... 279
--------
Forest Products (0.0%):
88 Carter Holt Harvey.................. 76
21 Fletcher Challenge Forestry (b)..... 12
42 Fletcher Challenge Paper............ 47
--------
135
--------
Telecommunications (0.2%):
235 Telecom Corp. of New Zealand Ltd.... 967
--------
Total New Zealand................... 1,381
--------
NORWAY (0.8%):
Banking (0.0%):
61 Christiania Bank og Kreditkasse..... 256
--------
Engineering (0.0%):
8 Kvaerner ASA........................ 256
--------
Entertainment (0.0%):
36 NCL Holdings ASA (b)................ 177
--------
Forest Products (0.0%):
6 Norske Skogsindustrier ASA.......... 173
--------
Insurance (0.1%):
54 Storebrand ASA (b).................. 478
--------
Manufacturing -- Consumer Goods (0.1%):
16 Orkla ASA, Series A................. 373
--------
Medical Equipment & Supplies (0.0%):
43 Hafslund ASA, Class A............... 172
--------
Metals & Mining (0.0%):
15 Elkem ASA........................... 175
--------
Oil & Gas (0.1%):
11 Petroleum Geo-Services ASA (b)...... 351
--------
Oil & Gas Exploration, Production & Services (0.4%):
9 Aker ASA, Class A (b)............... 134
16 Aker ASA, Class B................... 247
41 Norsk Hydro ASA..................... 1,799
--------
2,180
--------
Pharmaceuticals (0.0%):
42 Nycomed Amersham PLC, Series B...... 309
--------
Continued
77
181
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
NORWAY, CONTINUED:
Transportation & Shipping (0.1%):
10 Bona Shipholding (b)................ $ 73
17 Leif Hoegh & Co. ASA................ 254
--------
327
--------
Total Norway........................ 5,227
--------
PHILIPPINES (0.7%):
Banking (0.0%):
29 Security Bank Corp. (b)............. 13
35 Union Bank Philippines.............. 14
--------
27
--------
Banking & Finance (0.1%):
88 Metropolitan Bank & Trust Co........ 516
58 Philippine National Bank (b)........ 68
--------
584
--------
Beverages & Tobacco (0.1%):
266 San Miguel Corp., Class B........... 351
--------
Building Products (0.0%):
744 DMCI Holdings, Inc. (b)............. 23
2,109 Southeast Asia Cement Holdings, Inc.
(b)............................... 18
--------
41
--------
Diversified (0.0%):
367 Ayala Corp., Series B............... 95
--------
Electronic Components/Instruments (0.0%):
149 Ionics Circuit, Inc................. 47
--------
Food Products & Services (0.0%):
597 Universal Robina Corp............... 61
--------
Homebuilders (0.0%):
1,817 C&P Homes, Inc. (b)................. 91
--------
Oil & Gas Exploration, Production & Services (0.1%):
3,954 Petron Corp. (b).................... 417
--------
Real Estate (0.2%):
1,396 Ayala Land, Inc..................... 402
1,903 Filinvest Land, Inc. (b)............ 80
3,567 SM Prime Holdings, Inc.............. 565
--------
1,047
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
PHILIPPINES, CONTINUED:
Telecommunications (0.2%):
132 Manila Electric Co., Class B........ $ 349
43 Philipino Telephone Corp............ 975
--------
1,324
--------
Total Philippines................... 4,085
--------
PORTUGAL (1.0%):
Banking (0.4%):
25 Banco Comercial Portugues SA........ 711
22 Banco Espirito Santo e Commerical de
Lisboa SA, Registered............. 662
23 Banco Internacional do Funchal SA... 278
2 Banco Pinto & Sotto Mayor........... 40
17 BPI-SGPS SA, Registered............. 546
--------
2,237
--------
Beverages & Tobacco (0.0%):
11 UNICER-Uniao Cervejeira SA.......... 253
--------
Building Products (0.0%):
3 Cimpor-Cimentos de Portugal, SGPS
SA................................ 109
--------
Food & Household Products (0.2%):
23 Estabelecimentos Jeronimo Martins &
Filho SA.......................... 1,105
--------
Forest Products (0.1%):
8 Soporcel-Sociedade Portuguesa de
Celulose SA (b)................... 331
--------
Industrial Holding Company (0.1%):
10 Sonae Investimentos SA.............. 563
--------
Insurance (0.0%):
11 Companhia de Seguros Tranquilidade,
Registered........................ 300
--------
Retail -- General Merchandise (0.1%):
14 Modelo Continente-Sociedade Gestora
de Participacoes Sociais SA....... 373
--------
Telecommunications (0.1%):
16 Portugal Telecom SA................. 864
--------
Total Portugal...................... 6,135
--------
SINGAPORE (0.2%):
Automotive (0.0%):
20 Cycle & Carriage.................... 49
--------
Banking (0.0%):
41 Oversea-Chinese Banking Corp.,
Ltd............................... 140
--------
Conglomerates (0.0%):
326 United Industries................... 94
--------
Electrical Equipment (0.0%):
4 Creative Technology Ltd. (b)........ 49
--------
Continued
78
182
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
SINGAPORE, CONTINUED:
Health Care (0.0%):
51 Parkway Holdings.................... $ 88
--------
Machinery & Equipment (0.0%):
54 Van Der Horst Ltd. (b).............. 10
--------
Real Estate (0.1%):
55 City Developments Ltd............... 153
89 DBS Land Ltd........................ 73
76 First Capital Corp.................. 26
124 United Overseas Land Ltd............ 67
--------
319
--------
Retail -- Stores/Catalog (0.0%):
45 Metro Holdings...................... 27
--------
Steel (0.0%):
47 NatSteel Ltd........................ 46
--------
Telecommunications (0.1%):
269 Goldtron Ltd. (c)................... 20
334 Singapore Telecommunications Ltd.
(c)............................... 473
--------
493
--------
Transportation & Shipping (0.0%):
468 Chuan Hup Holdings Ltd.............. 100
347 Neptune Orient Lines Ltd. (b)....... 120
--------
220
--------
Transportation -- Shipping (0.0%):
41 Sembawang Marine & Logistics........ 22
--------
Total Singapore..................... 1,557
--------
SOUTH AFRICA (0.6%):
Banking & Finance (0.1%):
11 Nedcor Ltd.......................... 239
34 Standard Bank....................... 146
--------
385
--------
Brewery (0.1%):
16 South African Breweries Ltd......... 333
--------
Computer Hardware (0.0%):
30 Dimension Data Holdings Ltd. (b).... 164
--------
Diversified (0.1%):
9 Anglovaal Industries Ltd............ 10
11 Barlow Ltd.......................... 56
11 Imperial Holdings Ltd............... 111
18 Malbak Ltd.......................... 12
22 Rembrandt Group Ltd................. 137
22 Smith (C.G.) Ltd.................... 62
--------
388
--------
Engineering (0.0%):
31 Murray & Roberts Holdings Ltd....... 32
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
SOUTH AFRICA, CONTINUED:
Entertainment (0.0%):
55 Sun International (South Africa)
Ltd............................... $ 19
--------
Financial Services (0.0%):
29 Amalgamated Banks of South Africa... 179
--------
Financial -- Banking (0.0%):
3 Investec Group Ltd.................. 133
--------
Food & Household Products (0.0%):
5 Tiger Oats Ltd...................... 42
--------
Forest Products (0.0%):
11 Nampak Ltd.......................... 27
13 Sappi Ltd. (b)...................... 47
--------
74
--------
Industrial Goods & Services (0.0%):
16 African Oxygen Ltd.................. 28
4 Anglo American Industrial Corp.,
Ltd............................... 60
--------
88
--------
Insurance (0.1%):
105 Firstrand Ltd....................... 162
12 Liberty Life Association of Africa
Ltd............................... 235
33 Metropolitan Life Ltd............... 92
--------
489
--------
Materials (0.0%):
1 Anglo American Coal Corp., Ltd...... 65
--------
Metals (0.0%):
1 Anglogold Ltd....................... 35
186 Iscor Ltd........................... 35
4 Western Areas Gold Mining (b)....... 14
--------
84
--------
Metals & Mining (0.2%):
6 Anglo American Corp. of South Africa
Ltd............................... 200
1 Anglo American Gold Investment Co.,
Ltd............................... 19
41 Billiton PLC........................ 81
17 DeBeers Centenary AG................ 305
5 Driefontein Consolidated Ltd........ 27
8 Gencor Ltd.......................... 13
9 Gold Fields Ltd. (b)................ 38
2 Gold Fields of South Africa Ltd..... 17
3 Gold Shelf.......................... 11
8 Johnnies Industrial Corp., Ltd...... 70
8 Randfontein Estates Gold Mining Co.
(b)............................... 18
7 Rustenburg Platinum Holdings Ltd.... 76
4 Samancor Ltd........................ 17
--------
892
--------
Continued
79
183
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
SOUTH AFRICA, CONTINUED:
Oil & Gas (0.0%):
6 Engen Ltd........................... $ 17
--------
Oil & Gas Exploration, Production & Services (0.0%):
22 Sasol Ltd........................... 125
--------
Pharmaceuticals (0.0%):
3 South African Druggists Ltd......... 14
--------
Printing & Publishing (0.0%):
8 Nasionale Pers Beperk, Series N..... 55
--------
Retail -- General Merchandise (0.0%):
2 Ellerine Holdings Ltd............... 14
7 New Clicks Holdings Ltd............. 8
--------
22
--------
Retail -- Stores/Catalog (0.0%):
13 Pepkor Ltd.......................... 47
--------
Telecommunications -- Services and Equipment (0.0%):
18 M Web Holdings Ltd. (b)............. 65
--------
Total South Africa.................. 3,712
--------
SPAIN (4.7%):
Agriculture (0.1%):
12 Azucarera Ebro Agricolas (b)........ 346
--------
Banking (1.0%):
45 Banco Central Hispanoamericano SA... 1,423
135 Banco Santander SA.................. 3,457
62 Corporacion Bancaria de Espana SA... 1,393
--------
6,273
--------
Banking & Finance (0.7%):
87 Banco Bilbao Vizcaya SA............. 4,457
--------
Beverages & Tobacco (0.1%):
12 El Aguila SA (b).................... 113
26 Tabacalera SA....................... 533
--------
646
--------
Building Products (0.0%):
7 Uralita SA.......................... 103
--------
Chemicals (0.0%):
38 Ercros SA (b)....................... 48
--------
Construction (0.1%):
7 Dragados Y Construcciones SA........ 225
7 Fomento de Constucciones y Contratas
SA................................ 372
--------
597
--------
Energy (0.4%):
40 Repsol SA........................... 2,224
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
SPAIN, CONTINUED:
Forest Products (0.0%):
5 Empresa Nacional de Celulosas SA.... $ 86
24 Sarrio SA (b) (c)................... 115
--------
201
--------
Gas & Electric Utility (0.9%):
37 Empresa Nacional de Electricidad
SA................................ 524
132 Endesa SA........................... 2,894
116 Iberdrola SA........................ 1,892
40 Union Electric Fenosa SA............ 515
--------
5,825
--------
Industrial Holding Company (0.1%):
3 Corporacion Financiara Alba......... 374
--------
Insurance (0.0%):
8 Corporacion Mapfre.................. 274
--------
Oil & Gas Exploration, Production & Services (0.3%):
19 Gas Natural SDG..................... 1,375
5 Viscofan Industria Navarra de
Envolturas Celulosicas SA......... 219
--------
1,594
--------
Real Estate (0.1%):
13 Inmobiliaria Metro.................. 391
5 Vallehermoso SA..................... 184
--------
575
--------
Steel (0.0%):
2 Acerinox SA......................... 264
--------
Telecommunications (0.9%):
124 Telefonica de Espana................ 5,734
--------
Total Spain......................... 29,535
--------
SWEDEN (1.7%):
Automotive (0.1%):
17 Volvo AB, Series B.................. 495
--------
Banking & Finance (0.2%):
29 Skandiaviska Enskilda Banken, Class
A................................. 490
11 Svenska Handlesbanken, Class A...... 529
--------
1,019
--------
Engineering (0.1%):
32 ABB AB, A Shares.................... 447
11 ABB AB, B Shares.................... 154
5 Skanska AB, Series B................ 236
--------
837
--------
Continued
80
184
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
SWEDEN, CONTINUED:
Forest Products (0.1%):
15 Stora Kopparbergs Bergslags
Aktiebolag, Series A.............. $ 238
6 Stora Kopparbergs Bergslags
Aktiebolag, Series B.............. 91
16 Svenska Cellulosa AB, Series B...... 401
--------
730
--------
Insurance (0.1%):
27 Skandia Forsakrings AB.............. 383
--------
Machinery & Equipment (0.1%):
13 Atlas Copco AB, Series A............ 350
--------
Manufacturing -- Consumer Goods (0.1%):
28 Electrolux AB, Series B............. 474
--------
Metals & Mining (0.0%):
6 SKF AB, Series B.................... 109
8 Trelleborg AB, Series B............. 105
--------
214
--------
Office Equipment & Services (0.0%):
5 Esselte AB, Series B................ 107
--------
Pharmaceuticals (0.3%):
80 Astra AB, A Shares.................. 1,627
26 Astra AB, B Shares.................. 524
--------
2,151
--------
Real Estate (0.0%):
18 Fastighetspartner NF AB (b)......... 19
--------
Retail -- General Merchandise (0.1%):
14 Hennes & Mauritz AB, Series B....... 890
--------
Telecommunications (0.5%):
95 Telefonaktiebolaget LM Ericsson,
Series B.......................... 2,778
--------
Tobacco (0.0%):
20 Swedish Match AB.................... 67
--------
Total Sweden........................ 10,514
--------
SWITZERLAND (2.0%):
Chemicals (0.1%):
4 Ciba Specialty Chemicals AG......... 454
--------
Commercial Services (0.0%):
0 Kuoni Reisen Holding (e)............ 50
0 Societe Generale de Surveillance
Holdings SA (e)................... 110
--------
160
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
SWITZERLAND, CONTINUED:
Diversified (0.1%):
0 Alusuisse-Lonza Holding AG,
Registered (b)(e)................. $ 190
0 SFR ABB AG (e)...................... 384
--------
574
--------
Fertilizers (0.0%):
1 Societe Suisse pour la
Microelectronique et l'Horlogerie
AG................................ 192
--------
Financial Services (0.5%):
6 CS Holding AG, Registered........... 1,266
5 Union Bank of Switzerland AG,
Registered........................ 1,857
--------
3,123
--------
Food Products & Services (0.3%):
1 Nestle SA, Registered............... 1,947
--------
Insurance (0.2%):
0 Swiss Reinsurance Co., Registered
(e)............................... 986
--------
Pharmaceuticals (0.8%):
2 Novartis AG, Bearer................. 2,652
0 Roche Holding AG (e)................ 593
0 Roche Holding AG, Bearer (e)........ 1,473
--------
4,718
--------
Restaurants (0.0%):
0 Moevenpick Holding, Bearer (e)...... 25
--------
Retail -- Special Line (0.0%):
0 Jelmoli Holdings (e)................ 58
--------
Transportation (0.0%):
1 Danzas Holding AG, Registered....... 134
--------
Total Switzerland................... 12,371
--------
THAILAND (0.6%):
Airlines (0.0%):
136 Thai Airways International Public
Co., Ltd., Foreign Registered
Shares............................ 114
--------
Auto Parts (0.0%):
75 Thairung Union Car Public Co........ 23
--------
Automotive (0.0%):
109 Thai Manufacturing (b).............. 41
--------
Banking (0.1%):
410 Bangkok Bank PLC, Foreign Registered
Shares (c)........................ 505
348 Thai Farmers Bank, Foreign
Registered Shares (c)............. 306
--------
811
--------
Beverages & Tobacco (0.0%):
6 Serm Suk Co., Ltd. (b).............. 40
--------
Continued
81
185
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
THAILAND, CONTINUED:
Broadcasting/Cable (0.0%):
164 International Broadcasting Corp.,
Ltd. (b).......................... $ 109
--------
Building Products (0.1%):
52 Siam Cement, Foreign Registered
Shares (b)........................ 251
73 Tipco Asphalt Co., Ltd. (b)......... 83
--------
334
--------
Computer Hardware (0.1%):
24 K.R. Precision Public Co. (b)....... 16
82 Shinawatra Computer PLC (b) (c)..... 298
--------
314
--------
Construction (0.0%):
200 Italian-Thai Development Public,
Ltd. (b).......................... 102
--------
Cosmetics/Personal Care (0.0%):
57 I.C.C. International PLC............ 50
--------
Electronic Components/Instruments (0.0%):
6 Hana Microelectronics Co., Ltd.
(b)............................... 14
26 Hana Microelectronics Co., Ltd.,
Foreign Registered Shares (b)..... 66
--------
80
--------
Oil & Gas (0.2%):
113 PTT Exploration & Production (b)
(c)............................... 855
--------
Printing & Publishing (0.0%):
128 Nation Multimedia Group PLC (b)..... 27
107 Nation Multimedia Group, Foreign
Registered Shares (b)............. 36
--------
63
--------
Restaurants (0.0%):
31 Pizza Co., Ltd...................... 92
--------
Telecommunications (0.1%):
30 Advanced Information Services PLC,
Foreign Registered Shares......... 119
1,358 TelecomAsia Corp., Foreign
Registered Shares (b) (c)......... 393
102 TelecomAsia Corp., PLC (b).......... 23
--------
535
--------
Total Thailand...................... 3,563
--------
TURKEY (0.7%):
Appliances & Household Products (0.0%):
3,387 Arcelik AS.......................... 159
--------
Automotive (0.0%):
236 Otosan Otomobil Sanayii AS.......... 127
1,953 Tofas Turk Otomobil Fabrikas AS
(b)............................... 82
--------
209
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
TURKEY, CONTINUED:
Banking & Finance (0.2%):
1,937 Akbank TAS.......................... $ 63
7,356 Turkiye Garanti Bankasi AS (b)...... 337
--------
400
--------
Beverages & Tobacco (0.0%):
776 Ege Biracilik ve Malt Sanayi AS..... 92
404 Ericiyas Biracilik ve Malt
Sanayii........................... 61
--------
153
--------
Building Products (0.1%):
4,234 Akcansa Cimento AS.................. 130
983 Cimentas AS (b)..................... 55
999 Cimsa Cimento Sanayi ve Ticaret
AS................................ 51
1,322 Trakya Cam Sanayii.................. 55
746 Turk Sise ve Cam Fabrikalari AS..... 25
--------
316
--------
Chemicals (0.0%):
20 Petkim Petrokimya Holding AS........ 11
--------
Diversified (0.0%):
165 Alarko Holding...................... 45
469 Ihlas Holding....................... 64
153 Koc Holding AS...................... 30
--------
139
--------
Electrical & Electronic (0.0%):
94 Raks Electronik Ev Aletleri......... 35
--------
Electronics (0.0%):
719 Vestel Elektronik Sanayi (b)........ 96
--------
Financial Services (0.3%):
19,610 Turkiye Is Bankasi AS, Class C 791
3 Turkiye Is Bankasi, Class B (b)..... 8
17,547 Yapi ve Kredi Bankasi AS............ 448
--------
1,247
--------
Food Products & Services (0.0%):
1,079 Tat Konserve Sanayii AS............. 36
--------
Forest Products (0.0%):
569 Kartonsan Karton Sanayi ve Ticaret
AS................................ 44
--------
Industrial Goods & Services (0.0%):
455 Kordsa Kord Bezi Sanayi ve Ticaret
AS................................ 73
--------
Manufacturing -- Capital Goods (0.0%):
1,549 Turk Demir Dokum Fabrikalari AS..... 26
--------
Metals & Mining (0.0%):
959 Eregli Demir ve Celik Fabrikalari
TAS (b)........................... 149
799 Izmir Demir Celik Sanayi AS (b)..... 7
--------
156
--------
Continued
82
186
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
TURKEY, CONTINUED:
Oil & Gas (0.0%):
888 Turcas Petrolculuk AS............... $ 44
--------
Oil & Gas Exploration, Production & Services (0.0%):
395 Aygaz AS............................ 59
109 Petrol Ofisi AS..................... 28
131 Tupras Turkiye Petrol Rafinerileri
AS (b)............................ 21
--------
108
--------
Pharmaceuticals (0.0%):
263 Eczacibasi Ilac Sanayi Ve Ti (b).... 14
--------
Telecommunications (0.1%):
91 Cukurova Elektrik AS................ 259
293 Netas-Northern Elektrik
Telekomunikasyon AS (b)........... 78
--------
337
--------
Textile Products (0.0%):
746 Aksa Akrilik Kimya Sanayii AS....... 23
--------
Tire & Rubber (0.0%):
931 Brisa Bridgestone Sabanci Lastik
SAN, ve Tic AS.................... 45
1,233 Goodyear Lastikleri TAS............. 67
--------
112
--------
Transportation (0.0%):
1,419 Turk Hava Yollari AO (b)............ 149
--------
Wholesale Distribution (0.0%):
247 Migros Turk TAS..................... 241
--------
Total Turkey........................ 4,128
--------
UNITED KINGDOM (8.7%):
Aerospace & Military Technology (0.2%):
81 British Aerospace PLC............... 623
43 Rolls-Royce PLC..................... 179
35 Smiths Industries PLC............... 485
--------
1,287
--------
Airlines (0.1%):
57 British Airways PLC................. 609
--------
Appliances & Household Products (0.0%):
24 EMI Group PLC....................... 215
--------
Auto Parts (0.0%):
56 LucasVarity PLC..................... 226
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
UNITED KINGDOM, CONTINUED:
Banking (0.9%):
73 Abbey National PLC.................. $ 1,293
75 Barclays PLC........................ 2,151
29 HSBC Holdings PLC................... 731
49 HSBC Holdings PLC (Hong Kong
Dollars).......................... 1,186
26 Royal Bank of Scotland Group PLC.... 451
--------
5,812
--------
Beverages & Tobacco (0.4%):
135 Diageo PLC.......................... 1,603
50 Scottish & Newcastle PLC............ 707
--------
2,310
--------
Brewery (0.1%):
36 Bass PLC 667
--------
Broadcasting/Cable (0.1%):
62 British Sky Broadcasting Group
PLC............................... 444
--------
Building Products (0.1%):
30 Marley PLC.......................... 55
10 Meyer International PLC............. 60
50 Rugby Group PLC..................... 93
96 Tarmac PLC.......................... 172
--------
380
--------
Chemicals (0.1%):
33 Imperial Chemical Industries PLC.... 532
--------
Conglomerates (0.2%):
107 B.A.T. Industries PLC............... 1,065
13 Lonrho Africa PLC................... 16
19 Lonrho PLC (b)...................... 89
--------
1,170
--------
Construction (0.0%):
44 Taylor Woodrow PLC.................. 148
26 Wilson Connolly Holdings PLC........ 59
--------
207
--------
Electrical & Electronic (0.3%):
50 Bowthorpe PLC....................... 440
57 Electrocomponents PLC............... 463
100 General Electric Co., PLC........... 862
--------
1,765
--------
Energy (0.6%):
237 British Petroleum Co., PLC.......... 3,449
--------
Engineering (0.0%):
25 Barratt Developments PLC............ 109
--------
Continued
83
187
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
UNITED KINGDOM, CONTINUED:
Financial Services (0.5%):
193 Lloyds TSB Group PLC................ $ 2,700
55 St. James's Place Capital PLC....... 299
--------
2,999
--------
Food & Household Products (0.3%):
42 Cadbury Schweppes PLC............... 655
112 Unilever PLC........................ 1,198
--------
1,853
--------
Food Products & Services (0.1%):
69 J Sainsbury PLC..................... 613
--------
Forest Products (0.0%):
14 Arjo Wiggins Appleton............... 46
--------
Health & Personal Care (0.8%):
129 Glaxo Wellcome PLC.................. 3,886
30 Zeneca PLC.......................... 1,306
--------
5,192
--------
Industrial Holding Company (0.1%):
28 BICC Group PLC...................... 62
117 BTR PLC, Series A................... 331
56 Hanson PLC.......................... 340
--------
733
--------
Insurance (0.5%):
56 Commercial Union PLC................ 1,051
33 Legal and General Group PLC......... 354
65 Prudential Corp. PLC................ 852
53 Royal & Sun Alliance Insurance Group
PLC............................... 537
23 Sedwick Group PLC................... 48
13 Willis Corroon Group................ 33
--------
2,875
--------
Leisure (0.2%):
58 Granada Group PLC................... 1,064
26 Ladbroke Group PLC.................. 141
31 Rank Group PLC...................... 166
--------
1,371
--------
Machinery & Equipment (0.1%):
47 GKN PLC............................. 593
--------
Merchandising (0.0%):
43 Safeway PLC......................... 282
--------
Metals & Mining (0.1%):
89 British Steel PLC................... 196
72 English China Clays PLC............. 248
43 RTZ Corp., PLC, Registered.......... 479
--------
923
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
UNITED KINGDOM, CONTINUED:
Miscellaneous Materials & Commodities (0.0%):
37 Elementis 1998 PLC.................. $ 94
--------
Oil & Gas Exploration, Production & Services (0.2%):
160 BG PLC.............................. 924
50 LASMO PLC 200
51 Pilkington PLC...................... 94
--------
1,218
--------
Paper Products (0.0%):
41 Rexam PLC 179
--------
Pharmaceuticals (0.4%):
196 SmithKline Beecham PLC.............. 2,380
--------
Printing & Publishing (0.2%):
11 De La Rue Ltd....................... 55
15 Pearson............................. 270
34 Reed International PLC.............. 303
79 Reuters Group....................... 902
--------
1,530
--------
Real Estate (0.2%):
19 British Land Co., PLC............... 193
49 Land Securities PLC................. 752
--------
945
--------
Real Estate Investment Trust (0.1%):
23 Peninsular & Oriental Steam
Navigation Co..................... 330
--------
Retail -- General Merchandise (0.1%):
19 Kingfisher.......................... 313
--------
Retail -- Stores/Catalog (0.6%):
46 Boots Co., PLC...................... 757
41 Great Universal Stores PLC.......... 541
90 Marks & Spencer PLC................. 820
23 Next PLC............................ 195
117 Tesco PLC........................... 1,142
21 Thorn PLC........................... 81
--------
3,536
--------
Telecommunications (1.0%):
249 British Telecommunications PLC...... 3,061
94 Cable & Wireless PLC................ 1,149
154 Centrica PLC(b)..................... 260
50 National Power PLC.................. 471
127 Vodaphone Group PLC................. 1,606
--------
6,547
--------
Textile Products (0.0%):
24 Courtaulds Textiles PLC............. 118
--------
Continued
84
188
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
COMMON STOCKS, CONTINUED:
UNITED KINGDOM, CONTINUED:
Transportation -- Road & Railroad (0.1%):
17 Railtrack Group PLC................. $ 420
--------
Total United Kingdom................ 54,272
--------
UNITED STATES (0.0%):
Diversified (0.0%):
2 U.S. Industries, Inc................ 60
--------
VENEZUELA (0.4%):
Banking (0.0%):
22 Banco Venezuela Credito ADR......... 165
--------
Financial Services (0.0%):
37 Mercantil Servicios ADR............. 193
--------
Food Products & Services (0.1%):
107 Mavesa SA ADR....................... 340
--------
Home Furnishings (0.0%):
49 Ceramica Carabobo ADR............... 106
--------
Industrial Goods & Services (0.0%):
19 Siderurgica Venezuela ADR........... 121
--------
Paper Products (0.0%):
192 Venepal S.A.C.A. ADR................ 75
--------
Telecommunications (0.3%):
55 Compania Anonima Nacional Telefonos
de Venezuela...................... 1,384
--------
Textile Products (0.0%):
15 Mantex S.A.C.A. ADR................. 186
40 Sudamtex de Venezuela ADR........... 88
--------
274
--------
Total Venezuela..................... 2,658
--------
Total Common Stocks 589,391
--------
OPALS (0.6%):
TAIWAN (0.6%):
538 Morgan Stanley Composite Index,
Taiwan OPALS B.................... 3,847
--------
Total OPALS 3,847
--------
PREFERRED STOCKS (1.8%):
AUSTRALIA (0.2%):
Media (0.2%):
181 News Corp., Ltd..................... 1,280
--------
BRAZIL (0.4%):
Banking (0.1%):
21,519 Banco Bradesco SA................... 181
241 Banco Itau SA....................... 136
--------
317
--------
Beverages & Tobacco (0.0%):
151 Companhia Cervejaria Brahma......... 93
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
PREFERRED STOCKS, CONTINUED:
BRAZIL, CONTINUED:
Electric Utility (0.0%):
1,704 Cia Energetica de Sao Paolo......... $ 50
3,761 Companhia Energetica de Minas
Gerais............................ 116
1,712 Grasul Preferred -- B Share (b)..... 2
--------
168
--------
Forest Products (0.0%):
90 Sadia-Concordia SA.................. 52
--------
Oil & Gas Exploration, Production & Services (0.0%):
740 Petroleo Brasileiro SA.............. 138
--------
Steel (0.2%):
57 Companhia Vale do Rio Doce, Series
A................................. 1,152
--------
Telecommunications (0.1%):
3,900 Telecomunicacoes Brasileiras SA..... 430
441 Telecomunicacoes de Sao Paolo SA.... 105
--------
535
--------
Total Brazil........................ 2,455
--------
GERMANY (1.1%):
Automotive (0.1%):
1 Volkswagen AG....................... 927
--------
Building Products (0.0%):
1 Dyckerhoff AG....................... 207
--------
Business Service (0.8%):
6 SAP AG.............................. 4,180
--------
Gas & Electric Utility (0.2%):
35 RWE AG.............................. 1,498
--------
Total Germany....................... 6,812
--------
GREECE (0.0%):
Telecommunications (0.0%):
9 Intracom SA......................... 304
--------
ITALY (0.1%):
Automotive (0.1%):
218 Fiat SpA (b)........................ 543
--------
Total Preferred Stocks 11,394
--------
RIGHTS -- FOREIGN SECURITIES (0.0%):
AUSTRALIA (0.0%):
7 Resolute Limited (b)(e)............. 0
--------
AUSTRIA (0.0%):
36 Bank Austria AG (b)(e).............. 0
--------
BRAZIL (0.0%):
Steel (0.0%):
11 Vale do Rio Doce Bond Rights
(b)(e)............................ 0
--------
Continued
85
189
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
RIGHTS -- FOREIGN SECURITIES, CONTINUED:
BRAZIL, CONTINUED:
Telecommunications (0.0%):
9 Telecommunicacoes de Sao Paulo SA
(b)(e)............................ $ 0
--------
21 Telecommunicacoes de Sao Paulo SA,
Preferred (b)(e).................. 0
--------
CHILE (0.0%):
2 Telecom Chile ADR (b)............... 1
--------
GERMANY (0.0%):
73 Daimler-Benz (b).................... 82
32 Metro AG (b)........................ 1
--------
83
--------
GREECE (0.0%):
9 Alpha Credit Bank (b)............... 15
--------
MEXICO (0.0%):
8 Cemex SA de CV, Series A (b)(e)..... 0
2 Cemex SA de CV, Series B (b)(e)..... 0
--------
THAILAND (0.0%):
32 International Broadcasting (b)...... 6
--------
Total Rights - Foreign Securities 105
--------
U.S. TREASURY OBLIGATIONS (0.1%):
U.S. Treasury Bills (0.1%):
$ 500 9/17/98 (d)......................... 495
--------
Total U.S. Treasury Obligations 495
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
REPURCHASE AGREEMENTS (2.4%):
UNITED STATES (2.4%):
$15,035 State Street Bank, 5.00%, 7/1/98
(Collateralized by $15,035 U.S.
Treasury Bonds, 5.00%, 8/15/14,
market value $15,339)............. $ 15,035
--------
Total Repurchase Agreements 15,035
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (14.8%):
Repurchase Agreements (14.8%):
2,361 Lehman Brothers, 6.47%,
7/1/98(Collateralized by $2,479
Media One Group Bonds, 0.00%,
10/5/98, market value $2,479)..... 2,361
90,000 Paine Webber, 6.40%, 7/1/98
(Collateralized by $89,832 various
Corporate Bonds, 4.00% -- 9.75%,
7/15/98 -- 12/31/49, market value
$94,500).......................... 90,000
--------
Total Short-Term Securities Held as Collateral 92,361
--------
Total (Cost $579,126) (a) $712,628
--------
- ------------
Percentages indicated are based on net assets of $624,227.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $120. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $ 201,067
Unrealized depreciation..................................... (67,685)
----------
Net unrealized appreciation................................. $ 133,382
==========
(b) Non-income producing securities.
(c) A portion of this security was loaned as of June 30, 1998.
(d) Serves as collateral for futures contracts.
(e) Rounded to less than a thousand.
Continued
86
190
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
International Equity Index Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
CURRENT
NUMBER OPENING MARKET
OF POSITIONS VALUE
CONTRACTS CONTRACT TYPE (000) (000)
- --------- -------------------------------------------- --------- -------
52 Long Nikkei 225, September 1998 Futures $ 3,947 $ 4,079
29 Long EuroTop 100, September 1998 Futures 8,148 8,442
------- -------
$12,095 $12,521
======= =======
ADR American Depository Receipt
GDR Global Depository Receipt
At June 30, 1998, the Fund's open forward currency contracts were as follows:
UNREALIZED
DELIVERY CONTRACT CONTRACT CONTRACT MARKET APPRECIATION/
CURRENCY DATE PRICE AMOUNT VALUE VALUE (DEPRECIATION)
-------- -------- --------- -------- -------- ------- --------------
Long Contracts:
European Currency Unit............. 9/18/98 $ 0.9036 $ 6,200 $ 6,862 $ 6,813 $ (49)
Japanese Yen....................... 9/9/98 138.003 467,000 3,384 3,398 14
------- ------- -----
Total Long Contracts............... $10,246 $10,211 $ (35)
======= ======= =====
See notes to financial statements.
87
191
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
ASSET ALLOCATION INCOME EQUITY
FUND FUND
---------------- -------------
ASSETS:
Investments, at value....................................... $275,068 $ 996,472
Repurchase agreements, at cost.............................. 26,533 32,051
-------- ----------
Total (cost $264,919; $549,687; $914,982; $617,512;
$708,580; respectively)................................... 301,601 1,028,523
Cash........................................................ -- 1
Interest and dividends receivable........................... 1,549 1,983
Receivable for capital shares issued........................ 440 640
Receivable from brokers for investments sold................ -- 1,408
Prepaid expenses and other assets........................... 1 5
-------- ----------
TOTAL ASSETS................................................ 303,591 1,032,560
-------- ----------
LIABILITIES:
Dividends payable........................................... 522 789
Payable for capital shares redeemed......................... 52 175
Payable for return of collateral received for securities on
loan...................................................... 28,905 52,967
Payable to brokers for investments purchased................ 2,988 1,351
Payable for variation margin on futures contracts........... 43 --
Options written, at value (premiums received $97)........... -- --
Accrued expenses and other payables:
Investment advisory fees................................ 126 588
Administration fees..................................... 16 135
12b-1 fees.............................................. 100 157
Other................................................... 183 230
-------- ----------
TOTAL LIABILITIES........................................... 32,935 56,392
-------- ----------
NET ASSETS:
Capital..................................................... 224,327 447,045
Undistributed (distributions in excess) of net investment
income.................................................... 27 162
Accumulated undistributed net realized gains (losses) from
investment, options and futures transactions.............. 9,438 50,125
Net unrealized appreciation (depreciation) from investments,
futures and options....................................... 36,864 478,836
-------- ----------
NET ASSETS.................................................. $270,656 $ 976,168
======== ==========
NET ASSETS:.................................................
Fiduciary............................................... $105,243 $ 691,878
Class A................................................. 50,456 117,682
Class B................................................. 114,957 165,813
Class C................................................. -- 795
-------- ----------
Total....................................................... $270,656 $ 976,168
======== ==========
OUTSTANDING UNITS OF BENEFICIAL INTEREST (SHARES):
Fiduciary............................................... 7,627 28,742
Class A................................................. 3,652 4,895
Class B................................................. 8,290 6,886
Class C................................................. -- 33
======== ==========
Total....................................................... 19,569 40,556
======== ==========
Net Asset Value :
Fiduciary Offering and redemption price per share....... $ 13.80 $ 24.07
======== ==========
Class A Redemption price per share...................... $ 13.81 $ 24.04
======== ==========
Maximum sales charge.................................. 4.50% 4.50%
======== ==========
Maximum offering price per share (100%/(100%-maximum
sales charge) of net asset value adjusted to nearest
cent)................................................ $ 14.46 $ 25.17
======== ==========
Class B Offering price per share (a).................... $ 13.87 $ 24.08
======== ==========
Class C Offering price per share (a).................... $ 24.08
==========
- ------------
(a) Redemption price per Class B and Class C share varies based on length of
time shares are held.
See notes to financial statements.
88
192
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
EQUITY INDEX VALUE GROWTH LARGE COMPANY
FUND FUND VALUE FUND
- ------------ ------------ -------------
$1,286,410 $740,240 $820,097
72,011 46,166 83,871
---------- -------- --------
1,358,421 786,406 903,968
-- 1 3,937
1,250 713 1,164
1,775 637 66
4,686 -- 3,647
4 3 3
---------- -------- --------
1,366,136 787,760 912,785
---------- -------- --------
707 179 666
183 7 13
114,880 49,140 83,126
4,321 -- 2,598
158 106 --
-- -- 78
99 435 499
119 99 115
323 36 17
568 183 171
---------- -------- --------
121,358 50,185 87,283
---------- -------- --------
780,024 525,615 586,115
88 53 42
20,942 42,561 43,938
443,724 169,346 195,407
---------- -------- --------
$1,244,778 $737,575 $825,502
========== ======== ========
$ 671,422 $630,340 $792,649
218,518 80,500 15,699
351,624 25,501 17,154
3,214 1,234 --
========== ======== ========
$1,244,778 $737,575 $825,502
========== ======== ========
24,719 46,646 47,474
8,049 5,964 936
12,959 1,903 1,019
118 92 --
========== ======== ========
45,845 54,605 49,429
========== ======== ========
$ 27.16 $ 13.51 $ 16.70
========== ======== ========
$ 27.15 $ 13.50 $ 16.77
========== ======== ========
4.50% 4.50% 4.50%
========== ======== ========
$ 28.43 $ 14.14 $ 17.56
========== ======== ========
$ 27.13 $ 13.40 $ 16.84
========== ======== ========
$ 27.14 $ 13.47
========== ========
89
193
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
DISCIPLINED VALUE LARGE COMPANY
FUND GROWTH FUND
----------------- -------------
ASSETS:
Investments, at value....................................... $ 708,291 $2,064,976
Repurchase agreements, at cost.............................. 50,417 97,697
---------- ----------
Total (cost $650,635; $1,443,904; $1,037,010; $132,255;
$579,126; respectively)................................... 758,708 2,162,673
Cash........................................................ 203 1
Foreign currency, at value (cost $2,408).................... -- --
Interest and dividends receivable........................... 672 1,975
Receivable for capital shares issued........................ 75 882
Receivable from brokers for investments sold................ 75,046 86,533
Net receivable for variation margin on futures contracts.... -- --
Tax reclaim receivable...................................... -- --
Prepaid expenses and other assets........................... 4 8
---------- ----------
TOTAL ASSETS................................................ 834,708 2,252,072
---------- ----------
LIABILITIES:
Dividends payable........................................... 499 --
Payable for capital shares redeemed......................... 25 213
Payable for return of collateral received for securities on
loan...................................................... 59,486 177,147
Payable to brokers for investments purchased................ 79,792 81,870
Net payable for variation margin on futures contracts....... -- --
Payable for forward foreign currency contracts.............. -- --
Accrued expenses and other payables:
Investment advisory fees................................ 415 1,160
Administration fees..................................... 96 265
12b-1 fees.............................................. 30 257
Other................................................... 156 532
---------- ----------
TOTAL LIABILITIES........................................... 140,499 261,444
---------- ----------
NET ASSETS:
Capital..................................................... 501,412 1,095,916
Undistributed (distributions in excess) of net investment
income.................................................... 1 --
Accumulated undistributed net realized gains (losses) from
investment, options and futures transactions.............. 84,723 175,943
Net unrealized appreciation (depreciation) from investments,
futures, options and translation of assets and liabilities
in foreign currencies..................................... 108,073 718,769
---------- ----------
NET ASSETS.................................................. $ 694,209 $1,990,628
========== ==========
NET ASSETS:
Fiduciary............................................... $ 634,672 $1,510,521
Class A................................................. 29,443 199,052
Class B................................................. 30,094 280,563
Class C................................................. -- 492
---------- ----------
Total....................................................... $ 694,209 $1,990,628
========== ==========
OUTSTANDING UNITS OF BENEFICIAL INTEREST (SHARES):
Fiduciary............................................... 37,560 66,523
Class A................................................. 1,739 8,534
Class B................................................. 1,786 12,341
Class C................................................. -- 22
========== ==========
Total....................................................... 41,085 87,420
========== ==========
Net Asset Value:
Fiduciary Offering and redemption price per share......... $ 16.90 $ 22.71
========== ==========
Class A Redemption price per share........................ $ 16.93 $ 23.32
========== ==========
Maximum sales charge.................................... 4.50% 4.50%
========== ==========
Maximum offering price per share (100%/(100%-maximum
sales charge) of net asset value adjusted to nearest
cent).................................................. $ 17.73 $ 24.42
========== ==========
Class B Offering price per share (a)...................... $ 16.85 $ 22.73
========== ==========
Class C Offering price per share (a)...................... $ 22.57
==========
- ------------
(a) Redemption price per Class B and Class C share varies based on length of
time shares are held.
See notes to financial statements.
90
194
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
GROWTH SMALL INTERNATIONAL
OPPORTUNITIES CAPITALIZATION EQUITY INDEX
FUND FUND FUND
- ------------- -------------- -------------
$1,130,547 $144,046 $605,232
116,612 13,799 107,396
---------- -------- --------
1,247,159 157,845 712,628
1 10 --
-- -- 2,389
427 51 2,290
490 82 65
110,456 2,386 71
-- 27 --
-- -- 981
5 -- 3
---------- -------- --------
1,358,538 160,401 718,427
---------- -------- --------
-- -- --
78 8 10
205,962 14,537 92,361
94,767 440 594
-- -- 24
-- -- 35
622 86 273
142 17 84
91 11 15
310 60 804
---------- -------- --------
301,972 15,159 94,200
---------- -------- --------
780,252 105,263 496,208
-- -- 1,864
66,165 14,054 (7,735)
210,149 25,925 133,890
---------- -------- --------
$1,056,566 $145,242 $624,227
========== ======== ========
$ 868,901 $114,951 $586,741
95,647 21,634 24,060
90,930 8,567 13,307
1,088 90 119
---------- -------- --------
$1,056,566 $145,242 $624,227
========== ======== ========
38,597 9,542 32,647
4,278 1,800 1,337
4,242 727 768
49 7 7
========== ======== ========
47,166 12,076 34,759
========== ======== ========
$ 22.51 $ 12.05 $ 17.97
========== ======== ========
$ 22.36 $ 12.02 $ 17.99
========== ======== ========
4.50% 4.50% 4.50%
========== ======== ========
$ 23.41 $ 12.59 $ 18.84
========== ======== ========
$ 21.44 $ 11.79 $ 17.33
========== ======== ========
$ 22.42 $ 11.97 $ 17.91
========== ======== ========
91
195
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
ASSET ALLOCATION INCOME EQUITY EQUITY INDEX VALUE GROWTH LARGE COMPANY
FUND FUND FUND FUND VALUE FUND
---------- ---------- ---------- ----------- ------------
INVESTMENT INCOME:
Interest income......................... $ 6,541 $ 1,924 $ 1,531 $ 1,683 $ 2,012
Dividend income......................... 1,547 19,180 15,277 8,118 15,254
Income from securities lending.......... 59 119 210 131 154
---------- ---------- ---------- ----------- ------------
Total Income............................ 8,147 21,223 17,018 9,932 17,420
---------- ---------- ---------- ----------- ------------
EXPENSES:
Investment advisory fees................ 1,370 6,571 2,978 4,485 5,638
Administration fees..................... 345 1,454 1,626 993 1,248
12b-1 fees (Class A).................... 140 346 544 216 58
12b-1 fees (Class B).................... 739 1,219 2,522 161 132
12b-1 fees (Class C).................... -- 4 6 2 --
Custodian and accounting fees........... 72 62 170 70 59
Legal and audit fees.................... 12 28 34 23 24
Trustees' fees and expenses............. 3 14 17 10 12
Transfer agent fees..................... 258 439 981 168 94
Registration and filing fees............ 78 166 159 129 49
Printing costs.......................... 23 87 108 62 72
Other................................... 7 27 22 9 22
---------- ---------- ---------- ----------- ------------
Total expenses before waivers........... 3,047 10,417 9,167 6,328 7,408
Less waivers............................ (421) (99) (2,774) (62) (17)
---------- ---------- ---------- ----------- ------------
Net Expenses............................ 2,626 10,318 6,393 6,266 7,391
---------- ---------- ---------- ----------- ------------
Net Investment Income................... 5,521 10,905 10,625 3,666 10,029
---------- ---------- ---------- ----------- ------------
REALIZED / UNREALIZED GAINS (LOSSES)
FROM INVESTMENTS, OPTIONS AND FUTURES:
Net realized gains (losses) from
investment, option and future
transactions.......................... 15,512 76,585 26,070 72,571 71,328
Net change in unrealized appreciation
(depreciation) from investments,
options and futures................... 19,656 98,696 216,751 92,392 66,164
---------- ---------- ---------- ----------- ------------
Net realized/unrealized gains (losses)
from investments, options and
futures............................... 35,168 175,281 242,821 164,963 137,492
---------- ---------- ---------- ----------- ------------
Change in net assets resulting from
operations............................ $ 40,689 $ 186,186 $ 253,446 $ 168,629 $ 147,521
========== ========== ========== =========== ============
See notes to financial statements.
92
196
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
GROWTH SMALL INTERNATIONAL
DISCIPLINED LARGE COMPANY OPPORTUNITIES CAPITALIZATION EQUITY INDEX
VALUE FUND GROWTH FUND FUND FUND FUND
----------- ------------- ------------- -------------- --------------
INVESTMENT INCOME:
Interest income..................... $ 821 $ 606 $ 821 $ 577 $ 513
Dividend income..................... 10,584 18,607 4,269 557 11,478
Income from securities lending...... 251 252 593 100 399
Foreign tax withholding............. -- -- -- -- (1,356)
-------- -------- -------- ------- -------
Total Income.............. 11,656 19,465 5,683 1,234 11,034
-------- -------- -------- ------- -------
EXPENSES:
Investment advisory fees............ 4,759 12,024 6,492 902 2,791
Administration fees................. 1,053 2,661 1,437 200 831
12b-1 fees (Class A)................ 99 553 236 68 58
12b-1 fees (Class B)................ 254 1,953 639 55 114
12b-1 fees (Class C)................ -- 1 1 -- --
Custodian and accounting fees....... 69 119 127 40 570
Legal and audit fees................ 20 49 26 9 18
Organization costs.................. -- -- -- -- 2
Trustees' fees and expenses......... 9 26 14 2 8
Transfer agent fees................. 150 881 491 102 132
Registration and filing fees........ 41 165 107 50 71
Printing costs...................... 58 164 88 17 47
Other............................... 21 44 30 9 12
-------- -------- -------- ------- -------
Total expenses before waivers....... 6,533 18,640 9,688 1,454 4,654
Less waivers........................ (28) (158) (67) (57) (17)
-------- -------- -------- ------- -------
Net Expenses........................ 6,505 18,482 9,621 1,397 4,637
-------- -------- -------- ------- -------
Net Investment Income (Loss)........ 5,151 983 (3,938) (163) 6,397
-------- -------- -------- ------- -------
REALIZED / UNREALIZED GAINS (LOSSES)
FROM INVESTMENTS, OPTIONS, FUTURES
AND FOREIGN CURRENCIES:
Net realized gains (losses) from
investment, option, future, and
foreign currency transactions..... 141,237 278,531 140,625 21,421 172
Net change in unrealized
appreciation (depreciation) from
investments, options, futures and
translation of assets and
liabilities in foreign
currencies........................ 9,794 237,485 99,487 1,800 43,167
-------- -------- -------- ------- -------
Net realized/unrealized gains
(losses) from investments,
options, futures and foreign
currency.......................... 151,031 516,016 240,112 23,221 43,339
-------- -------- -------- ------- -------
Change in net assets resulting from
operations........................ $156,182 $516,999 $236,174 $23,058 $49,736
======== ======== ======== ======= =======
See notes to financial statements.
93
197
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
ASSET ALLOCATION FUND INCOME EQUITY FUND EQUITY INDEX FUND
------------------------- ------------------------- -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income (loss)....... $ 5,521 $ 4,173 $ 10,905 $ 9,950 $ 10,625 $ 9,130
Net realized gains (losses) from
investment, option and future
transactions..................... 15,512 15,867 76,585 63,053 26,070 20,871
Net change in unrealized
appreciation (depreciation) from
investments, options and
futures.......................... 19,656 4,463 98,696 89,271 216,751 140,765
-------- -------- --------- --------- ---------- ---------
Change in net assets resulting from
operations........................... 40,689 24,503 186,186 162,274 253,446 170,766
-------- -------- --------- --------- ---------- ---------
DISTRIBUTIONS TO FIDUCIARY
SHAREHOLDERS:
From net investment income......... (2,881) (2,678) (9,093) (8,549) (7,794) (7,178)
In excess of net investment
income........................... -- (11) -- (14) -- --
From net realized gains from
investment transactions.......... (10,063) (2,959) (62,899) (10,510) (14,824) (3,288)
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income......... (1,102) (764) (1,122) (948) (1,688) (899)
In excess of net investment
income........................... -- (3) -- (2) -- --
From net realized gains from
investment transactions.......... (3,738) (974) (9,117) (1,743) (3,454) (420)
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income......... (1,516) (731) (521) (453) (1,052) (780)
In excess of net investment
income........................... -- (3) -- (1) -- --
From net realized gains from
investment transactions.......... (6,134) (1,129) (10,250) (1,424) (5,722) (629)
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net investment income......... -- -- (2) -- (3) --
From net realized gains from
investment transactions.......... -- -- (11) -- (1) --
-------- -------- --------- --------- ---------- ---------
Change in net assets from shareholder
distributions........................ (25,434) (9,252) (93,015) (23,644) (34,538) (13,194)
-------- -------- --------- --------- ---------- ---------
CAPITAL TRANSACTIONS:
Proceeds from shares issued........ 116,110 74,038 175,771 113,454 453,171 372,043
Proceeds from shares issued in
conversion....................... -- 37,254 70,389 283,942 -- --
Dividends reinvested............... 16,312 6,840 36,266 11,938 16,587 6,593
Cost of shares redeemed............ (47,271) (49,880) (206,930) (135,743) (191,744) (180,134)
-------- -------- --------- --------- ---------- ---------
Change in net assets from share
transactions......................... 85,151 68,252 75,496 273,591 278,014 198,502
-------- -------- --------- --------- ---------- ---------
Change in net assets................... 100,406 83,503 168,667 412,221 496,922 356,074
NET ASSETS:
Beginning of period................ 170,250 86,747 807,501 395,280 747,856 391,782
-------- -------- --------- --------- ---------- ---------
End of period...................... $270,656 $170,250 $ 976,168 $ 807,501 $1,244,778 $ 747,856
======== ======== ========= ========= ========== =========
SHARE TRANSACTIONS:
Issued............................. 8,804 6,114 7,871 6,001 18,855 20,262
Issued in conversion............... -- 3,076 3,342 14,913 -- --
Reinvested......................... 1,278 573 1,690 656 719 360
Redeemed........................... (3,607) (4,071) (9,166) (7,141) (8,031) (9,830)
-------- -------- --------- --------- ---------- ---------
Change in shares....................... 6,475 5,692 3,737 14,429 11,543 10,792
======== ======== ========= ========= ========== =========
See notes to financial statements.
94
198
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
VALUE GROWTH FUND LARGE COMPANY VALUE FUND DISCIPLINED VALUE FUND
------------------------- ------------------------- -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income (loss)...... $ 3,666 $ 3,251 $ 10,029 $ 12,627 $ 5,151 $ 8,249
Net realized gains (losses) from
investment, option and future
transactions.................... 72,571 42,586 71,328 17,493 141,237 59,778
Net change in unrealized
appreciation (depreciation) from
investments, options and
futures......................... 92,392 51,518 66,164 126,134 9,794 36,525
--------- --------- ---------- --------- --------- ---------
Change in net assets resulting from
operations.......................... 168,629 97,355 147,521 156,254 156,182 104,552
--------- --------- ---------- --------- --------- ---------
DISTRIBUTIONS TO FIDUCIARY
SHAREHOLDERS
From net investment income........ (3,380) (2,906) (9,741) (12,228) (4,991) (7,822)
From net realized gains from
investment transactions......... (54,060) (36,353) (41,719) (47,388) (91,826) (53,221)
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income........ (243) (316) (177) (209) (169) (274)
From net realized gains from
investment transactions......... (6,125) (5,893) (1,000) (904) (4,398) (2,285)
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income........ (2) (16) (70) (69) (7) (89)
From net realized gains from
investment transactions......... (1,479) (992) (700) (410) (3,742) (1,855)
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net investment income........ --(a) -- -- -- -- --
From net realized gains from
investment transactions......... --(a) -- -- -- -- --
--------- --------- ---------- --------- --------- ---------
Change in net assets from shareholder
distributions....................... (65,289) (46,476) (53,407) (61,208) (105,133) (65,546)
--------- --------- ---------- --------- --------- ---------
CAPITAL TRANSACTIONS:
Proceeds from shares issued....... 244,292 236,686 145,236 165,729 153,275 107,311
Proceeds from shares issued in
conversion...................... -- -- -- 63,222 -- 48,296
Dividends reinvested.............. 30,601 39,472 24,049 26,644 54,080 32,360
Cost of shares redeemed........... (129,318) (70,246) (148,173) (238,407) (170,905) (179,880)
--------- --------- ---------- --------- --------- ---------
Change in net assets from share
transactions........................ 145,575 205,912 21,112 17,188 36,450 8,087
--------- --------- ---------- --------- --------- ---------
Change in net assets.................. 248,915 256,791 115,226 112,234 87,499 47,093
NET ASSETS:
Beginning of period............... 488,660 231,869 710,276 598,042 606,710 559,617
--------- --------- ---------- --------- --------- ---------
End of period..................... $ 737,575 $ 488,660 $ 825,502 $ 710,276 $ 694,209 $ 606,710
========= ========= ========== ========= ========= =========
SHARE TRANSACTIONS:
Issued............................ 19,945 22,826 9,198 12,629 9,189 7,390
Issued in conversion.............. -- -- -- 4,655 -- 3,333
Reinvested........................ 2,642 4,071 1,586 2,051 3,435 2,299
Redeemed.......................... (10,452) (6,738) (9,357) (17,923) (10,296) (12,355)
--------- --------- ---------- --------- --------- ---------
Change in shares...................... 12,135 20,159 1,427 1,412 2,328 667
========= ========= ========== ========= ========= =========
- ------------
(a) Amount is less than 1,000.
See notes to financial statements.
95
199
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
LARGE COMPANY GROWTH FUND GROWTH OPPORTUNITIES FUND SMALL CAPITALIZATION FUND
------------------------- ------------------------- -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income (loss)...... $ 983 $ 6,257 $ (3,938) $ 7,629 $ (163) $ (231)
Net realized gains (losses) from
investment, option and future
transactions.................... 278,531 130,961 140,625 35,797 21,421 10,486
Net change in unrealized
appreciation (depreciation) from
investments, options and
futures......................... 237,485 186,164 99,487 87,369 1,800 1,985
---------- ---------- ---------- --------- --------- ---------
Change in net assets resulting from
operations.......................... 516,999 323,382 236,174 130,795 23,058 12,240
---------- ---------- ---------- --------- --------- ---------
DISTRIBUTIONS TO FIDUCIARY
SHAREHOLDERS
From net investment income........ (1,456) (5,746) -- (7,053) -- --
In excess of net investment
income.......................... -- -- -- (669) -- --
From net realized gains from
investment transactions......... (167,063) (37,414) (80,645) (83,581) (9,265) (8,358)
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income........ (14) (403) -- (361) -- --
In excess of net investment
income.......................... (44) -- -- (34) -- --
From net realized gains from
investment transactions......... (20,430) (4,265) (7,223) (4,572) (1,939) (1,835)
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income........ -- (23) -- (215) -- --
In excess of net investment
income.......................... -- -- -- (20) -- --
From net realized gains from
investment transactions......... (24,184) (3,785) (7,104) (3,102) (521) (302)
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net realized gains from
investment transactions......... (4) -- --(a) -- --(a) --
---------- ---------- ---------- --------- --------- ---------
Change in net assets from shareholder
distributions....................... (213,195) (51,636) (94,972) (99,607) (11,725) (10,495)
---------- ---------- ---------- --------- --------- ---------
CAPITAL TRANSACTIONS:
Proceeds from shares issued....... 343,977 230,983 305,038 291,882 59,655 14,236
Proceeds from shares issued in
conversion...................... 81,659 289,603 57,769 -- -- --
Dividends reinvested.............. 119,823 31,237 63,284 56,517 10,295 9,973
Cost of shares redeemed........... (259,677) (299,888) (215,417) (248,384) (35,493) (30,774)
---------- ---------- ---------- --------- --------- ---------
Change in net assets from share
transactions........................ 285,782 251,935 210,674 100,015 34,457 (6,565)
---------- ---------- ---------- --------- --------- ---------
Change in net assets.................. 589,586 523,681 351,876 131,203 45,790 (4,820)
NET ASSETS:
Beginning of period............... 1,401,042 877,361 704,690 573,487 99,452 104,272
---------- ---------- ---------- --------- --------- ---------
End of period..................... $1,990,628 $1,401,042 $1,056,566 $ 704,690 $ 145,242 $ 99,452
========== ========== ========== ========= ========= =========
SHARE TRANSACTIONS:
Issued............................ 17,372 14,003 14,578 16,132 4,975 1,433
Issued in conversion.............. 4,595 17,279 3,113 -- -- --
Reinvested........................ 6,450 1,936 3,314 3,283 946 1,042
Redeemed.......................... (12,865) (18,015) (10,127) (13,633) (2,939) (3,085)
---------- ---------- ---------- --------- --------- ---------
Change in shares...................... 15,552 15,203 10,878 5,782 2,982 (610)
========== ========== ========== ========= ========= =========
- ------------
(a) Amount is less than 1,000.
See notes to financial statements.
96
200
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
INTERNATIONAL EQUITY INDEX
FUND
---------------------------
YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30,
1998 1997
------------ ------------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income (loss)........................... $ 6,397 $ 4,485
Net realized gains (losses) from investment, option
future and foreign currency transactions.............. 172 5,054
Net change in unrealized appreciation (depreciation)
from investments, options and futures and translation
of assets and liabilities in foreign currencies....... 43,167 51,395
-------- --------
Change in net assets resulting from operations.............. 49,736 60,934
-------- --------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS
From net investment income............................. (623) (4,346)
In excess of net investment income..................... -- (3,417)
From net realized gains from investment transactions... (12,040) (3,811)
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income............................. (4) (92)
In excess of net investment income..................... -- (73)
From net realized gains from investment transactions... (435) (111)
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income............................. -- (47)
From net realized gains from investment transactions... (301) (72)
In excess of net realized gains from investment
transactions.......................................... -- (37)
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net realized gains from investment transactions... --(a) --
-------- --------
Change in net assets from shareholder distributions......... (13,403) (12,006)
-------- --------
CAPITAL TRANSACTIONS:
Proceeds from shares issued............................ 200,947 191,629
Dividends reinvested................................... 8,154 2,834
Cost of shares redeemed................................ (93,751) (135,282)
-------- --------
Change in net assets from share transactions................ 115,350 59,181
-------- --------
Change in net assets........................................ 151,683 108,109
NET ASSETS:
Beginning of period.................................... 472,544 364,435
-------- --------
End of period.......................................... $624,227 $472,544
======== ========
SHARE TRANSACTIONS:
Issued................................................. 11,868 12,777
Reinvested............................................. 539 189
Redeemed............................................... (5,635) (9,008)
-------- --------
Change in shares............................................ 6,772 3,958
======== ========
- ------------
(a) Amount is less than 1,000.
See notes to financial statements.
97
201
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
GROWTH INTERNATIONAL
ASSET ALLOCATION OPPORTUNITIES EQUITY INDEX
FUND FUND FUND
---------------- ------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Total investment income................................. $ 8,147 $ 5,683 $ 11,034
Net Expenses............................................ (2,626) (9,621) (4,637)
----------- ----------- -----------
Net investment income (loss)............................ 5,521 (3,938) 6,397
Adjustments to reconcile net investment income to net
cash provided (used) by operating activities:
(Amortization)/accretion of discount/premium....... (97) -- (15)
Change in interest and dividends receivable........ (348) (38) (1,328)
Change in accrued expenses and other payables...... 249 554 232
----------- ----------- -----------
Total adjustments.................................. (196) 516 (1,111)
----------- ----------- -----------
Net cash provided (used) by operating activities........ 5,325 (3,422) 5,286
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of short-term investments......... 1,841,799 3,505,742 2,507,704
Proceeds from sales of long-term investments.......... 92,165 1,372,349 49,480
Purchases of short-term investments................... (1,853,269) (3,568,447) (2,513,911)
Purchases of long-term investments.................... (146,956) (1,406,474) (146,672)
Purchases of short-term investments with cash received
as collateral from securities lending.............. (28,905) (205,962) (92,361)
Mark to market of futures............................. 1,217 -- 612
----------- ----------- -----------
Net cash provided (used) by investing activities........ (93,949) (302,792) (195,148)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from shares issued........................... 115,990 347,298 200,975
Cost of shares redeemed............................... (47,244) (215,357) (93,748)
Distributions paid to shareholders.................... (25,339) (94,972) (17,882)
Dividends reinvested.................................. 16,312 63,284 8,155
Collateral received from securities lending........... 28,905 205,962 92,361
----------- ----------- -----------
Net cash provided (used) by financing activities........ 88,624 306,215 189,861
Net increase (decrease) in cash......................... -- 1 (1)
Cash at beginning of period............................. -- -- 1
----------- ----------- -----------
Cash at end of period................................... $ -- $ 1 $ --
=========== =========== ===========
See notes to financial statements.
98
202
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS JUNE 30, 1998
1. ORGANIZATION:
The One Group (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end investment company
established as a Massachusetts business trust. The accompanying financial
statements and financial highlights are those of the Asset Allocation Fund,
the Income Equity Fund, the Equity Index Fund, the Value Growth Fund, the
Large Company Value Fund, the Disciplined Value Fund, the Large Company
Growth Fund, the Growth Opportunities Fund, the Small Capitalization Fund
(previously named the Gulf South Growth Fund) and the International Equity
Index Fund (individually a "Fund", collectively the "Funds") only. In 1997
the investment objective of the Gulf South Growth Fund was changed to permit
investments in companies headquartered or doing business outside of the
Southeastern region of the United States, and to focus the Fund's investments
to a greater extent on investments in the equity securities of small
capitalization and emerging growth companies. As a result, the name of the
Fund was changed to The One Group Small Capitalization Fund. Each Fund is a
diversified mutual fund.
The Funds' investment objectives are as follows:
FUND OBJECTIVE
---- ---------
Asset Allocation Fund To provide total return while preserving capital.
Income Equity Fund Current income through regular payment of dividends with
the secondary goal of achieving capital appreciation by
investing primarily in equity securities.
Equity Index Fund Investment results that correspond to the aggregate price
and dividend performance of the securities in the
Standard & Poor's 500 Composite Stock Price Index.
Value Growth Fund Long-term capital growth and growth of income with a
secondary objective of providing a moderate level of
current income.
Large Company Value Fund Capital appreciation with the incidental goal of
achieving current income by investing primarily in
equity securities.
Disciplined Value Fund Capital appreciation with the secondary goal of achieving
current income by investing primarily in equity
securities.
Large Company Growth Fund Long-term capital appreciation and growth of income by
investing primarily in equity securities.
Growth Opportunities Fund Growth of capital and secondarily, current income by
investing primarily in equity securities.
Small Capitalization Fund Long-term capital growth, primarily by investing in a
portfolio of equity securities of small-capitalization
and emerging growth companies.
International Equity Index Fund To provide investment results that correspond to the
aggregate price and dividend performance of the
securities in the Gross Domestic Product Weighted Morgan
Stanley Capital International Europe, Australia, and Far
East Index.
Continued
99
203
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Trust in preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for the
period. Actual results could differ from those estimates.
SECURITY VALUATION
Listed securities are valued at the latest available sales price on the
principal exchange where such securities are traded. Unlisted securities
or listed securities for which latest sales prices are not available are
valued at the mean of the latest bid and ask price in the principal
market where such securities are normally traded. Corporate debt
securities and debt securities of U.S. issuers (other than short-term
investments maturing in 60 days or less), including municipal securities,
are valued on the basis of valuations provided by dealers or by an
independent pricing service approved by the Board of Trustees. Short-term
investments maturing in 60 days or less are valued at amortized cost,
which approximates market value. Futures contracts are valued at the
settlement price established each day by the board of trade or exchange
on which they are traded. Options traded on an exchange are valued using
the last sale price or, in the absence of a sale, the last offering
price. Options traded over-the-counter are valued using dealer-supplied
valuations. Investments for which there are no such quotations or
valuations are carried at fair value as determined by the Fair Value
Committee which is comprised of members from Banc One Investment Advisors
Corporation (the "Advisor") and The One Group Services Company (the
"Administrator") under the direction of the Board of Trustees.
FOREIGN CURRENCY TRANSLATION
Investment valuations, other assets and liabilities initially expressed
in foreign currencies are converted each business day into U.S. dollars
based upon current exchange rates. Purchases and sales of foreign
investments and income and expenses are converted into U.S. dollars based
upon exchange rates prevailing on the respective dates of such
transactions. That portion of realized gains or losses and unrealized
appreciation or depreciation from investments due to fluctuations in
foreign currency exchange rates is not separately disclosed. Such
fluctuations are included with the net realized and unrealized gain or
loss from investments.
FORWARD FOREIGN CURRENCY CONTRACTS
Forward foreign currency contracts are valued at the daily exchange rate
of the underlying currency. Purchases and sales of forward foreign
currency contracts having the same settlement date and broker are
presented net on the Statement of Assets and Liabilities. The forward
foreign currency exchange contracts are adjusted by the daily exchange
rate of the underlying currency and any gains or losses are recorded for
financial statement purposes as unrealized appreciation or depreciation
until the contract settlement date. Gains or losses from the purchase or
sale of forward foreign currency contracts having the same settlement
date and broker are recorded as realized on the date of offset; otherwise
gains or losses are recorded as realized on settlement date.
REPURCHASE AGREEMENTS
The Funds may invest in repurchase agreements with institutions that are
deemed by the Advisor to be of good standing and creditworthy under
guidelines established by the Board of Trustees. Each repurchase
agreement is recorded at cost. The Fund requires that the securities
purchased in a repurchase agreement
Continued
100
204
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
transaction be transferred to the custodian in a manner sufficient to
enable the Fund to obtain those securities in the event of a counterparty
default. The seller, under the repurchase agreement, is required to
maintain the value of the securities held at not less than the repurchase
price, including accrued interest. Repurchase agreements are considered
to be loans under the 1940 Act.
WRITTEN OPTIONS
The Funds may write covered call or secured put options for which
premiums received are recorded as liabilities and are subsequently
adjusted to the current value of the options written. Premiums received
from writing options which expire are treated as realized gains. Premiums
received from writing options, which are either exercised or closed, are
offset against the proceeds received or amount paid on the transaction to
determine realized gains or losses.
FUTURES CONTRACTS
The Funds may enter into futures contracts for the delayed delivery of
securities at a fixed price at some future date or for the change in the
value of a specified financial index over a predetermined time period.
Cash or securities are deposited with brokers in order to maintain a
position. Subsequent payments made or received by the Fund based on the
daily change in the market value of the position are recorded as
unrealized appreciation or depreciation until the contract is closed out,
at which time the appreciation or depreciation is realized.
INDEXED SECURITIES
The Funds may invest in indexed securities whose value is linked either
directly or inversely to changes in foreign currencies, interest rates,
commodities, indices or other reference instruments. Indexed securities
may be more volatile than the referenced instrument itself, but any loss
is limited to the amount of the original investment.
SECURITIES LENDING
To generate additional income, the Funds may lend up to 33% of securities
in which they are invested pursuant to agreements requiring that the loan
be continuously secured by cash, U.S. Government or U.S. Government
Agency securities, shares of an investment trust or mutual fund, or any
combination of cash and such securities as collateral equal at all times
to at least 100% of the market value plus accrued interest on the
securities lent. The Funds continue to earn dividends and interest on
securities lent while simultaneously seeking to earn interest on the
investment of collateral. Collateral is marked to market daily to provide
a level of collateral at least equal to the market value of securities
lent. There may be risks of delay in recovery of the securities or even
loss of rights in the collateral should the borrower of the securities
fail financially. However, loans will be made only to borrowers deemed by
the Advisor to be of good standing and creditworthy under guidelines
established by the Board of Trustees and when, in the judgment of the
Advisor, the consideration which can be earned currently from such
securities loans justifies the attendant risks. Loans are subject to
termination by the Funds or the borrower at any time, and are, therefore,
not
Continued
101
205
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
considered to be illiquid investments. As of June 30, 1998, the following
Funds had securities with the following market values on loan (amounts in
thousands):
MARKET VALUE MARKET VALUE MARKET VALUE
OF CASH OF NON-CASH OF LOANED
COLLATERAL COLLATERAL SECURITIES
------------- ------------- -------------
Asset Allocation Fund............... $ 28,905 $ 7,650 $ 35,563
Income Equity Fund.................. 52,967 8,656 59,102
Equity Index Fund................... 114,880 6,175 117,972
Value Growth Fund................... 49,140 1,726 49,552
Large Company Value Fund............ 83,126 14,954 95,208
Disciplined Value Fund.............. 59,486 -- 58,328
Large Company Growth Fund........... 177,147 1,841 170,452
Growth Opportunities Fund........... 205,962 5,570 206,531
Small Capitalization Fund........... 14,537 -- 14,520
International Equity Index Fund..... 92,361 -- 91,782
The loaned securities were fully collateralized by cash and U.S.
Government securities as of June 30, 1998.
SECURITY TRANSACTIONS AND RELATED INCOME
Security transactions are accounted for on a trade date basis. Net
realized gains or losses from sales of securities are determined on the
specific identification cost method. Interest income and expenses are
recognized on the accrual basis. Dividends are recorded on the
ex-dividend date. Interest income, including any discount or premium, is
accrued as earned using the effective interest method.
EXPENSES
Expenses directly attributable to a Fund are charged directly to that
Fund, while the expenses, which are attributable to more than one Fund of
the Trust, are allocated among the respective Funds. Each class of shares
bears its pro-rata portion of expenses attributable to its series, except
that each class separately bears expenses related specifically to that
class, such as distribution fees.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income are declared and paid monthly for
the Funds except for the International Equity Index Fund which declares
and pays dividends, if any, at least annually. Net realized capital
gains, if any, are distributed at least annually. Dividends are declared
separately for each class. No class has preferential dividend rights;
differences in per share dividend rates are due to differences in
separate class expenses.
Distributions from net investment income and from net 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 for expiring capital loss
carryforwards, foreign currency transactions, and deferrals of certain
losses. Permanent book and tax basis differences have been reclassified
among the components of net assets.
FEDERAL INCOME TAXES
The Trust treats each Fund as a separate entity for Federal income tax
purposes. Each Fund intends to continue to qualify as a regulated
investment company by complying with the provisions available to certain
Continued
102
206
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
investment companies as defined in applicable sections of the Internal
Revenue Code, and to make distributions from net investment income and
from net realized capital gains sufficient to relieve it from all, or
substantially all, Federal income taxes. Withholding taxes on foreign
dividends have been paid or provided for in accordance with the
applicable country's tax rules and rates.
3. SHARES OF BENEFICIAL INTEREST:
The Trust has an unlimited number of shares of beneficial interest, with no
par value which may, without shareholder approval, be divided into an
unlimited number of series of such shares and any series may be classified or
reclassified into one or more. The Trust is registered to offer forty series
and five classes of shares: Fiduciary Class, Class A, Class B, Class C and
Service Class. Currently, the Trust consists of thirty-three active funds.
The Funds are each authorized to issue Fiduciary Class, Class A, Class B and
Class C Shares. Class A Shares are subject to initial sales charges, imposed
at the time of purchase, in accordance with the Funds' prospectus. Certain
redemptions of Class B and Class C Shares are subject to contingent deferred
sales charges in accordance with the Fund's prospectus. As of June 30, 1998,
there were no shareholders in Class C of the Asset Allocation Fund, Large
Company Value Fund or the Disciplined Value Fund. Shareholders are entitled
to one vote for each full share held and will vote in the aggregate and not
by class or series, except as otherwise expressly required by law or when the
Board of Trustees has determined that the matter to be voted on affects only
the interest of shareholders of a particular class or series. The following
is a summary of transactions in Fund shares for the fiscal years ended June
30, 1998 and 1997:
Continued
103
207
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
ASSET ALLOCATION FUND INCOME EQUITY FUND EQUITY INDEX FUND
------------------------- ------------------------- -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued......... $ 30,168 $ 36,157 $ 58,578 $ 39,671 $ 190,730 $193,036
Proceeds from shares issued in
conversion........................ -- 37,254 70,389 283,942 -- --
Dividends reinvested................ 4,088 3,380 15,841 7,467 4,908 3,889
Cost of shares redeemed............. (30,385) (41,096) (171,640) (115,841) (132,565) (148,567)
-------- -------- --------- --------- --------- --------
Change in net assets from
Fiduciary Share transactions...... $ 3,871 $ 35,695 $ (26,832) $ 215,239 $ 63,073 $ 48,358
======== ======== ========= ========= ========= ========
CLASS A SHARES:
Proceeds from shares issued......... $ 19,947 $ 14,748 $ 40,534 $ 33,483 $ 115,183 $ 72,287
Dividends reinvested................ 4,728 1,663 9,837 2,597 4,949 1,279
Cost of shares redeemed............. (8,491) (5,587) (21,803) (15,299) (34,893) (25,085)
-------- -------- --------- --------- --------- --------
Change in net assets from
Class A Share transactions........ $ 16,184 $ 10,824 $ 28,568 $ 20,781 $ 85,239 $ 48,481
======== ======== ========= ========= ========= ========
CLASS B SHARES:
Proceeds from shares issued......... $ 65,995 $ 23,133 $ 75,943 $ 40,300 $ 144,112 $106,720
Dividends reinvested................ 7,496 1,797 10,575 1,874 6,727 1,425
Cost of shares redeemed............. (8,395) (3,197) (13,487) (4,603) (24,214) (6,482)
-------- -------- --------- --------- --------- --------
Change in net assets from
Class B Share transactions........ $ 65,096 $ 21,733 $ 73,031 $ 37,571 $ 126,625 $101,663
======== ======== ========= ========= ========= ========
CLASS C SHARES:
Proceeds from shares issued......... $ 716 $ 3,146
Dividends reinvested................ 13 3
Cost of shares redeemed............. -- (72)
--------- ---------
Change in net assets from
Class C Share transactions........ $ 729 $ 3,077
========= =========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued.............................. 2,320 3,003 2,678 2,121 8,081 10,607
Issued in conversion................ -- 3,076 3,342 14,913 -- --
Reinvested.......................... 322 284 736 412 212 215
Redeemed............................ (2,330) (3,348) (7,605) (6,085) (5,630) (8,036)
-------- -------- --------- --------- --------- --------
Change in Fiduciary Shares.......... 312 3,015 (849) 11,361 2,663 2,786
======== ======== ========= ========= ========= ========
CLASS A SHARES:
Issued.............................. 1,513 1,212 1,796 1,768 4,740 3,962
Reinvested.......................... 370 139 459 142 213 69
Redeemed............................ (645) (460) (966) (814) (1,415) (1,452)
-------- -------- --------- --------- --------- --------
Change in Class A Shares............ 1,238 891 1,289 1,096 3,538 2,579
======== ======== ========= ========= ========= ========
CLASS B SHARES:
Issued.............................. 4,971 1,899 3,365 2,112 5,913 5,693
Reinvested.......................... 586 150 494 102 294 76
Redeemed............................ (632) (263) (595) (242) (984) (342)
-------- -------- --------- --------- --------- --------
Change in Class B Shares............ 4,925 1,786 3,264 1,972 5,223 5,427
======== ======== ========= ========= ========= ========
CLASS C SHARES:
Issued.............................. 32 121
Reinvested.......................... 1 --(a)
Redeemed............................ -- (2)
--------- ---------
Change in Class C Shares............ 33 119
========= =========
- ------------
(a) Amount is less than 1,000.
Continued
104
208
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
LARGE COMPANY VALUE
VALUE GROWTH FUND FUND DISCIPLINED VALUE FUND
------------------------- ------------------------- -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued................. $ 203,642 $ 222,240 $ 126,127 $ 150,998 137,992 $ 95,887
Proceeds from shares issued in conversion... -- -- -- 63,222 -- 48,296
Dividends reinvested........................ 22,920 32,485 22,134 25,070 45,915 27,911
Cost of shares redeemed..................... (117,078) (59,895) (132,244) (229,727) (158,657) (168,332)
--------- --------- --------- --------- --------- ---------
Change in net assets from
Fiduciary Share transactions.............. $ 109,484 $ 194,830 $ 16,017 $ 9,563 25,250 $ 3,762
========= ========= ========= ========= ========= =========
CLASS A SHARES:
Proceeds from shares issued................. $ 26,868 $ 9,761 $ 11,457 $ 10,438 $ 8,085 $ 8,230
Dividends reinvested........................ 6,201 5,980 1,150 1,100 4,444 2,515
Cost of shares redeemed..................... (10,432) (9,421) (13,864) (8,010) (9,149) (9,255)
--------- --------- --------- --------- --------- ---------
Change in net assets from
Class A Share transactions................ $ 22,637 $ 6,320 $ (1,257) $ 3,528 $ 3,380 $ 1,490
========= ========= ========= ========= ========= =========
CLASS B SHARES:
Proceeds from shares issued................. $ 12,570 $ 4,685 $ 7,652 $ 4,293 $ 7,198 $ 3,194
Dividends reinvested........................ 1,480 1,007 765 474 3,721 1,934
Cost of shares redeemed..................... (1,805) (930) (2,065) (670) (3,099) (2,293)
--------- --------- --------- --------- --------- ---------
Change in net assets from
Class B Share transactions................ $ 12,245 $ 4,762 $ 6,352 $ 4,097 $ 7,820 $ 2,835
========= ========= ========= ========= ========= =========
CLASS C SHARES:
Proceeds from shares issued................. $ 1,212
Dividends reinvested........................ --(a)
Cost of shares redeemed..................... (3)
---------
Change in net assets from
Class C Share transactions................ $ 1,209
=========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued...................................... 16,681 21,444 8,011 11,519 8,280 6,612
Issued in conversion........................ -- -- -- 4,655 -- 3,333
Reinvested.................................. 1,984 3,352 1,462 1,931 2,926 1,984
Redeemed.................................... (9,458) (5,755) (8,381) (17,266) (9,567) (11,571)
--------- --------- --------- --------- --------- ---------
Change in Fiduciary Shares.................. 9,207 19,041 1,092 839 1,639 358
========= ========= ========= ========= ========= =========
CLASS A SHARES:
Issued...................................... 2,167 929 712 793 481 559
Reinvested.................................. 531 615 75 84 277 178
Redeemed.................................... (847) (893) (849) (607) (544) (628)
--------- --------- --------- --------- --------- ---------
Change in Class A Shares.................... 1,851 651 (62) 270 214 109
========= ========= ========= ========= ========= =========
CLASS B SHARES:
Issued...................................... 1,005 453 475 317 428 219
Reinvested.................................. 127 104 49 36 232 137
Redeemed.................................... (147) (90) (127) (50) (185) (156)
--------- --------- --------- --------- --------- ---------
Change in Class B Shares.................... 985 467 397 303 475 200
========= ========= ========= ========= ========= =========
CLASS C SHARES:
Issued...................................... 92
Reinvested.................................. --(a)
Redeemed.................................... --(a)
---------
Change in Class C Shares.................... 92
=========
- ------------
(a) Amount is less than 1,000.
Continued
105
209
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
LARGE COMPANY GROWTH
FUND GROWTH OPPORTUNITIES FUND SMALL CAPITALIZATION FUND
------------------------- ------------------------- -------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
----------- ----------- ----------- ----------- ----------- -----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued................. $ 181,645 $ 134,662 $ 203,143 $ 216,371 $ 50,388 $ 9,250
Proceeds from shares issued in conversion... 81,659 289,603 57,769 -- -- --
Dividends reinvested........................ 75,483 22,758 49,055 48,075 7,886 7,857
Cost of shares redeemed..................... (208,952) (274,724) (189,297) (199,916) (30,812) (23,477)
--------- --------- --------- --------- -------- --------
Change in net assets from
Fiduciary Share transactions.............. $ 129,835 $ 172,299 $ 120,670 $ 64,530 $ 27,462 $ (6,370)
========= ========= ========= ========= ======== ========
CLASS A SHARES:
Proceeds from shares issued................. $ 57,440 $ 39,340 $ 56,011 $ 54,262 $ 4,568 $ 3,550
Dividends reinvested........................ 20,287 4,698 7,158 5,065 1,888 1,821
Cost of shares redeemed..................... (33,812) (17,325) (19,911) (46,273) (3,978) (6,707)
--------- --------- --------- --------- -------- --------
Change in net assets from
Class A Share transactions................ $ 43,915 $ 26,713 $ 43,258 $ 13,054 $ 2,478 $ (1,336)
========= ========= ========= ========= ======== ========
CLASS B SHARES:
Proceeds from shares issued................. $ 104,460 $ 56,981 $ 44,814 $ 21,249 $ 4,606 $ 1,436
Dividends reinvested........................ 24,050 3,781 7,071 3,377 521 295
Cost of shares redeemed..................... (16,913) (7,839) (6,203) (2,195) (703) (590)
--------- --------- --------- --------- -------- --------
Change in net assets from
Class B Share transactions................ $ 111,597 $ 52,923 $ 45,682 $ 22,431 $ 4,424 $ 1,141
========= ========= ========= ========= ======== ========
CLASS C SHARES:
Proceeds from shares issued................. $ 432 $ 1,070 $ 93
Dividends reinvested........................ 3 --(a) --(a)
Cost of shares redeemed..................... -- (6)
--------- --------- --------
Change in net assets from
Class C Share transactions................ $ 435 $ 1,064 $ 93
========= ========= ========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued...................................... 9,422 8,322 9,733 11,966 4,210 933
Issued in conversion........................ 4,595 17,279 3,113 -- -- --
Reinvested.................................. 4,107 1,418 2,574 2,790 724 821
Redeemed.................................... (10,404) (16,537) (8,883) (11,005) (2,551) (2,352)
--------- --------- --------- --------- -------- --------
Change in Fiduciary Shares.................. 7,720 10,482 6,537 3,751 2,383 (598)
========= ========= ========= ========= ======== ========
CLASS A SHARES:
Issued...................................... 2,777 2,308 2,614 2,954 374 354
Reinvested.................................. 1,060 285 365 293 173 190
Redeemed.................................... (1,625) (1,016) (940) (2,503) (329) (673)
--------- --------- --------- --------- -------- --------
Change in Class A Shares.................... 2,212 1,577 2,039 744 218 (129)
========= ========= ========= ========= ======== ========
CLASS B SHARES:
Issued...................................... 5,151 3,373 2,183 1,212 384 146
Reinvested.................................. 1,283 233 375 200 49 31
Redeemed.................................... (836) (462) (304) (125) (59) (60)
--------- --------- --------- --------- -------- --------
Change in Class B Shares.................... 5,598 3,144 2,254 1,287 374 117
========= ========= ========= ========= ======== ========
CLASS C SHARES:
Issued...................................... 22 48 7
Reinvested.................................. --(a) --(a) --(a)
Redeemed.................................... -- --(a) --
--------- --------- --------
Change in Class C Shares.................... 22 48 7
--------- --------- --------
- ------------
(a) Amount is less than 1,000.
Continued
106
210
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
INTERNATIONAL EQUITY
INDEX FUND
-------------------------
YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30,
1998 1997
----------- -----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued........ $172,750 $182,120
Dividends reinvested............... 7,260 2,570
Cost of shares redeemed............ (77,664) (129,185)
-------- --------
Change in net assets from
Fiduciary Share transactions..... $102,346 $ 55,505
======== ========
CLASS A SHARES:
Proceeds from shares issued........ $ 23,709 $ 5,122
Dividends reinvested............... 536 167
Cost of shares redeemed............ (13,917) (4,769)
-------- --------
Change in net assets from
Class A Share transactions....... $ 10,328 $ 520
======== ========
CLASS B SHARES:
Proceeds from shares issued........ $ 4,365 $ 4,387
Dividends reinvested............... 358 97
Cost of shares redeemed............ (2,165) (1,328)
-------- --------
Change in net assets from
Class B Share transactions....... $ 2,558 $ 3,156
======== ========
CLASS C SHARES:
Proceeds from shares issued........ $ 123
Dividends reinvested............... --(a)
Cost of shares redeemed............ (5)
--------
Change in net assets from
Class C Share transactions....... $ 118
========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued............................. 10,217 12,143
Reinvested......................... 481 171
Redeemed........................... (4,685) (8,601)
-------- --------
Change in Fiduciary Shares......... 6,013 3,713
======== ========
CLASS A SHARES:
Issued............................. 1,376 337
Reinvested......................... 34 11
Redeemed........................... (816) (317)
-------- --------
Change in Class A Shares........... 594 31
======== ========
CLASS B SHARES:
Issued............................. 268 297
Reinvested......................... 24 7
Redeemed........................... (134) (90)
-------- --------
Change in Class B Shares........... 158 214
======== ========
CLASS C SHARES:
Issued............................. 7
Reinvested......................... --(a)
Redeemed........................... --(a)
--------
Change in Class C Shares........... 7
========
- ------------
(a) Amount is less than 1,000.
Continued
107
211
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
4. INVESTMENT ADVISORY, ADMINISTRATIVE, AND DISTRIBUTION AGREEMENTS:
The Trust and the Advisor are parties to an investment advisory agreement
under which the Advisor is entitled to a fee, computed daily and paid
monthly, at the annual rate of 0.74% of the average net assets of the Income
Equity Fund, the Value Growth Fund, the Large Company Value Fund, the
Disciplined Value Fund, the Large Company Growth Fund, the Growth
Opportunities Fund, and the Small Capitalization Fund; 0.65% of the average
daily net assets of the Asset Allocation Fund; 0.55% of the average daily net
assets of the International Equity Index Fund; and 0.30% of the average daily
net assets of the Equity Index Fund.
Independence International Associates ("IIA"), an indirect subsidiary of John
Hancock Mutual Life Insurance Company, manages the investment portfolio of
the International Equity Index Fund subject to the supervision of the Advisor
pursuant to a Sub-Advisory Agreement with the Advisor. For its services, IIA
is paid a fee by the Advisor, computed daily and paid monthly, at the annual
rate of 0.275% of average daily net assets up to $10 million, 0.225% of
average daily net assets over $10 million up to $25 million, 0.195% of net
assets over $25 million up to $50 million, 0.125% of the average daily net
assets over $50 million up to $100 million and 0.060% of the average daily
net assets over $100 million.
The Trust and the Administrator, a wholly-owned subsidiary of The BISYS
Group, Inc., are parties to an administrative agreement under which the
Administrator provides services for a fee that is computed daily and paid
monthly, at an annual rate of 0.20% on the first $1.5 billion of Trust net
assets (excluding the Investor Growth Fund, the Investor Growth & Income
Fund, the Investor Conservative Fund, and the Investor Balanced Fund (the
"Investor Funds") and the Treasury Only Money Market Fund and the Government
Money Market Fund (the "Institutional Money Market Funds")); 0.18% on the
next $0.5 billion of Trust net assets (excluding the Investor Funds and the
Institutional Money Market Funds); and 0.16% of Trust net assets (excluding
the Investor Funds and the Institutional Money Market Funds) over $2 billion.
The Advisor also serves as Sub-Administrator to each Fund of the Trust,
pursuant to an agreement between the Administrator and the Advisor. Pursuant
to this agreement, the Advisor performs many of the Administrator's duties,
for which the Advisor receives a fee paid by the Administrator.
The Trust and The One Group Services Company (the "Distributor") are parties
to a distribution agreement under which shares of the Funds are sold on a
continuous basis. Class A, Class B, and Class C Shares are subject to
distribution and shareholder services plans (the "Plans") pursuant to Rule
12b-1 under the 1940 Act. As provided in the Plans, the Trust will pay the
Distributor a fee of 0.35% of the average daily net assets of Class A Shares
of each of the Funds and 1.00% of the average daily net assets of the Class B
Shares and Class C Shares of each of the Funds. Currently, the Distributor
has voluntarily agreed to limit payments under the Plans to 0.25% of average
daily net assets of the Class A Shares of each Fund. Up to 0.25% of the fees
payable under the Plans may be used as compensation for shareholder services
by the Distributor and/or financial institutions and intermediaries. Fees
paid under the Plans may be applied by the Distributor toward (i)
compensation for its services in connection with distribution assistance or
provision of shareholder services; or (ii) payments to financial institutions
and intermediaries such as banks (including affiliates of the Advisor),
brokers, dealers and other institutions, including the Distributor's
affiliates and subsidiaries as compensation for services or reimbursement of
expenses incurred in connection with distribution assistance or provision of
shareholder services. Fiduciary Class Shares of each Fund are offered without
distribution fees. For the year ended June 30, 1998, the Distributor received
$23,155,470 from commissions earned on sales of Class A Shares and
redemptions of Class B Shares and Class C Shares, of which, the Distributor
re-allowed $22,831,371 to affiliated broker-dealers of the Funds.
Certain officers of the Trust are affiliated with the Administrator. Such
officers receive no compensation from the Funds for serving in their
respective roles.
Continued
108
212
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
The Advisor, the Administrator and the Distributor voluntarily agreed to
waive a portion of their fees. For the year ended June 30, 1998, fees in the
following amounts were waived (amounts in thousands):
INVESTMENT 12b-1 FEES
ADVISORY FEES ADMINISTRATION WAIVED
WAIVED FEES WAIVED CLASS A
------------- --------------- ----------
Asset Allocation Fund......................... $ 192 $189 $ 40
Income Equity Fund............................ -- -- 99
Equity Index Fund............................. 1,986 633 155
Value Growth Fund............................. -- -- 62
Large Company Value Fund...................... -- -- 17
Disciplined Value Fund........................ -- -- 28
Large Company Growth Fund..................... -- -- 158
Growth Opportunities Fund..................... -- -- 67
Small Capitalization Fund..................... -- 38 19
International Equity Index Fund............... -- -- 17
5. SECURITIES TRANSACTIONS:
The cost of security purchases and the proceeds from the sale of securities
(excluding short-term securities and purchased options) during the year ended
June 30, 1998 were as follows (amounts in thousands):
PURCHASES SALES
---------- ----------
Asset Allocation Fund....................................... $ 146,956 $ 92,165
Income Equity Fund.......................................... 128,438 198,358
Equity Index Fund........................................... 314,037 41,376
Value Growth Fund........................................... 422,844 360,483
Large Company Value Fund.................................... 340,970 356,506
Disciplined Value Fund...................................... 669,033 716,503
Large Company Growth Fund................................... 1,915,515 1,902,532
Growth Opportunities Fund................................... 1,406,474 1,372,349
Small Capitalization Fund................................... 104,484 94,432
International Equity Index Fund............................. 146,672 49,480
6. FINANCIAL INSTRUMENTS:
Investing in financial instruments such as options, futures, indexed
securities and sales of forward foreign currency contracts involves risk in
excess of the amounts reflected in the Statements of Assets and Liabilities.
The face or contract amounts reflect the extent of the involvement the Funds
have in the particular class of instrument. Risks associated with these
instruments include an imperfect correlation between the movements in the
price of the instruments and the price of the underlying securities and
interest rates, an illiquid secondary market for the instruments or inability
of counterparties to perform under the terms of the contract, and changes in
the value of currency relative to the U.S. dollar. The Funds enter into these
contracts primarily as a means to hedge against adverse fluctuations in the
value of securities.
Continued
109
213
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
The following is a summary of option activity for the year ended June 30,
1998 by the Funds (amounts in thousands):
LARGE COMPANY VALUE FUND
-------------------------
SHARES SUBJECT
TO CONTRACT PREMIUMS
-------------- --------
COVERED CALL OPTIONS
Balance at beginning of period............................ 0 $ 0
Options written........................................... 1,080 1,447
Options closed............................................ 0 0
Options expired........................................... (592) (792)
Options exercised......................................... (388) (558)
----- ------
Options outstanding at end of period...................... 100 $ 97
===== ======
LARGE COMPANY GROWTH FUND
--------------------------
SHARES SUBJECT
TO CONTRACT PREMIUMS
-------------- --------
PURCHASED CALL OPTIONS
Balance at beginning period............................... 0 $ 0
Options Purchased......................................... 475 5,148
Options Sold.............................................. (475) (5,148)
----- ------
Options outstanding at end of period...................... 0 $ 0
===== ======
LARGE COMPANY VALUE FUND
-------------------------
SHARES SUBJECT
TO CONTRACT PREMIUMS
-------------- --------
COVERED CALL OPTIONS
Options outstanding at end of period consist of:
Archer-Daniels-Midland Co., $20, 7/20/98.................. 50 $ 22
Viacom, Inc., $60, 7/20/98................................ 50 56
----- ------
100 $ 78
===== ======
7. CONCENTRATION OF CREDIT RISK:
The International Equity Index Fund has a relatively large concentration of
securities invested in companies domiciled in Japan. The Fund may be more
susceptible to the political, social and economic events adversely affecting
the Japanese companies than funds not so concentrated.
8. CONVERSION OF COMMON TRUST FUNDS:
On December 19, 1997, the net assets of certain common trust funds managed by
the Advisor were exchanged in a tax-free conversion for shares of the
corresponding One Group Funds. The transaction was accounted for by a method
followed for tax purposes in a tax-free business combination. The following
is a summary of shares issued, net assets converted, net assets value per
share issued and unrealized appreciation of assets acquired as of the
conversion date (amounts in thousands except per share amounts):
Continued
110
214
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
NET ASSET
VALUE
SHARES NET ASSETS PER SHARE UNREALIZED
ISSUED CONVERTED ISSUED APPRECIATION
------ ---------- ---------- ------------
Income Equity Fund....................... 3,342 $70,389 $21.06 $23,821
Large Company Growth Fund................ 4,595 81,659 17.77 33,084
Growth Opportunities Fund................ 3,113 57,769 18.56 15,137
On January 20, 1997, the net assets of certain common trust funds managed by
the Advisor were exchanged in a tax-free conversion for shares of the
corresponding One Group Funds. The transaction was accounted for by a method
followed for tax purposes in a tax-free business combination. The following
is a summary of shares issued, net assets converted, net assets value per
share issued and unrealized appreciation of assets acquired as of the
conversion date (amounts in thousands except per share amounts):
NET ASSET
VALUE
SHARES NET ASSETS PER SHARE UNREALIZED
ISSUED CONVERTED ISSUED APPRECIATION
------ ---------- ---------- ------------
Asset Allocation Fund.................... 3,076 $ 37,254 $12.11 $ 8,361
Income Equity Fund....................... 14,913 283,942 19.04 150,438
Large Company Value Fund................. 4,655 63,222 13.58 7,315
Disciplined Value Fund................... 3,333 48,296 14.49 7,763
Large Company Growth Fund................ 17,279 289,603 16.76 102,448
9. FEDERAL TAX INFORMATION (UNAUDITED):
The accompanying table below details distributions from long-term capital
gains for the following funds for the fiscal year ended June 30, 1998
(amounts in thousands):
20% 28%
FUND DISTRIBUTION DISTRIBUTION
---- ------------ ------------
Asset Allocation Fund....................................... $ 2,427 $ 8,826
Income Equity Fund.......................................... 30,673 47,694
Equity Index Fund........................................... 17,664 3,010
Value Growth Fund........................................... 8,988 11,490
Large Company Value Fund.................................... 11,322 10,306
Disciplined Value Fund...................................... 23,206 45,629
Large Company Growth Fund................................... 92,507 106,905
Growth Opportunities Fund................................... 9,527 --
Small Capitalization Fund................................... 3,165 5,779
International Equity Index Fund............................. 9,654 2,364
Capital losses and currency losses incurred after October 31 within the
Fund's fiscal year may be deferred and treated as occurring on the first day
of the following fiscal year. The following deferred losses will be treated
as arising on the first day of the fiscal year ended June 30, 1999 (amounts
in thousands):
FUND AMOUNT
---- ------
International Equity Index Fund............................. $7,190
ELIGIBLE DISTRIBUTIONS:
The Trust designates the following percentage of distributions eligible for
the dividends received deductions for corporations.
Continued
111
215
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
FUND AMOUNT
---- -------
Asset Allocation Fund....................................... 10.66%
Income Equity Fund.......................................... 99.78%
Equity Index Fund........................................... 96.31%
Value Growth Fund........................................... 17.65%
Large Company Value Fund.................................... 53.51%
Disciplined Value Fund...................................... 31.71%
Large Company Growth Fund................................... 29.53%
Growth Opportunities Fund................................... 5.26%
Small Capitalization Fund................................... 18.22%
International Equity Index Fund............................. --
10. SUBSEQUENT EVENTS
On May 21, 1998, the Board of Trustees approved an agreement and plan of
reorganization and liquidation ("the Plan") with the Marquis Family of Funds
(the "Marquis Funds"). Under the Plan, the assets and liabilities of each
Marquis fund were transferred to a comparable One Group fund. Shares of the
comparable One Group fund were distributed to the Marquis shareholders in a
complete liquidation of each Marquis fund. A special Shareholder Meeting to
approve the plan was held on July 30, 1998. In a tax-free exchange on August
10, 1998, net assets of the Marquis funds were exchanged for shares of a
corresponding fund of The One Group as follows (amounts in thousands):
SHARES NET ASSETS
ONE GROUP FUND ISSUED MARQUIS FUND CONVERTED
-------------- ------ ------------ ----------
Asset Allocation Fund 10,802 Balanced Fund $141,641
Disciplined Value Fund 9,923 Value Equity Fund 136,943
Growth Opportunities Fund 1,962 Growth Equity Fund 38,617
Small Capitalization Fund 376 Small Cap Equity Fund 3,669
International Equity Index Fund 96 International Equity Fund 1,666
112
216
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ASSET ALLOCATION FUND
------------------------------------------------
FIDUCIARY
------------------------------------------------
YEAR ENDED JUNE 30,
------------------------------------------------
1998 1997 1996 1995 1994
-------- ------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 12.98 $ 11.71 $ 10.73 $ 9.64 $ 10.06
-------- ------- ------- ------- -------
Investment Activities:
Net investment income..................................... 0.40 0.43 0.41 0.38 0.29
Net realized and unrealized gains (losses) from
investments............................................. 2.24 1.81 1.16 1.12 (0.38)
-------- ------- ------- ------- -------
Total from Investment Activities........................ 2.64 2.24 1.57 1.50 (0.09)
-------- ------- ------- ------- -------
Distributions:
Net investment income..................................... (0.39) (0.43) (0.41) (0.37) (0.29)
Net realized gains........................................ (1.43) (0.54) (0.18) (0.04) (0.04)
-------- ------- ------- ------- -------
Total Distributions..................................... (1.82) (0.97) (0.59) (0.41) (0.33)
-------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 13.80 $ 12.98 $ 11.71 $ 10.73 $ 9.64
======== ======= ======= ======= =======
Total Return................................................ 22.12% 20.16% 14.87% 16.06% (1.01)%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $105,243 $94,971 $50,323 $37,658 $42,751
Ratio of expenses to average net assets................... 0.85% 0.80% 0.94% 1.06% 1.06%
Ratio of net investment income to average net assets...... 3.03% 3.55% 3.58% 3.72% 2.91%
Ratio of expenses to average net assets*.................. 1.03% 1.00% 1.19% 1.31% 1.33%
Ratio of net investment income to average net assets*..... 2.85% 3.35% 3.33% 3.47% 2.64%
Portfolio turnover (a).................................... 46.04% 80.96% 73.38% 115.36% 56.55%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
113
217
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ASSET ALLOCATION FUND
----------------------------------------------
CLASS A
----------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- ------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 13.00 $ 11.72 $ 10.74 $ 9.65 $10.06
------- ------- ------- ------- ------
Investment Activities:
Net investment income..................................... 0.36 0.39 0.37 0.35 0.27
Net realized and unrealized gains (losses) from
investments............................................. 2.24 1.83 1.16 1.13 (0.38)
------- ------- ------- ------- ------
Total from Investment Activities........................ 2.60 2.22 1.53 1.48 (0.11)
------- ------- ------- ------- ------
Distributions:
Net investment income..................................... (0.36) (0.40) (0.37) (0.34) (0.26)
In excess of net investment income........................ -- -- -- (0.01) --
Net realized gains........................................ (1.43) (0.54) (0.18) (0.04) (0.04)
------- ------- ------- ------- ------
Total Distributions..................................... (1.79) (0.94) (0.55) (0.39) (0.30)
------- ------- ------- ------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 13.81 $ 13.00 $ 11.72 $ 10.74 $ 9.65
======= ======= ======= ======= ======
Total Return (Excludes Sales Charge)........................ 21.71% 19.85% 14.48% 15.76% (1.19)%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period(000).......................... $50,456 $31,379 $17,849 $ 4,745 $1,691
Ratio of expenses to average net assets................... 1.10% 1.05% 1.19% 1.31% 1.33%
Ratio of net investment income to average net assets...... 2.77% 3.30% 3.33% 3.57% 2.68%
Ratio of expenses to average net assets*.................. 1.38% 1.34% 1.54% 1.66% 1.67%
Ratio of net investment income to average net assets*..... 2.49% 3.01% 2.98% 3.22% 2.34%
Portfolio turnover (a).................................... 46.04% 80.96% 73.38% 115.36% 56.55%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
114
218
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ASSET ALLOCATION FUND
----------------------------------------------------
CLASS B
----------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
-------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(a)
-------- -------- ------- ------ -----------
NET ASSET VALUE,
BEGINNING OF PERIOD................................... $ 13.04 $ 11.76 $ 10.76 $ 9.67 $10.37
-------- -------- ------- ------ ------
Investment Activities:
Net investment income................................. 0.26 0.30 0.28 0.27 0.08
Net realized and unrealized gains (losses) from
investments......................................... 2.26 1.83 1.18 1.14 (0.70)
-------- -------- ------- ------ ------
Total from Investment Activities.................... 2.52 2.13 1.46 1.41 (0.62)
-------- -------- ------- ------ ------
Distributions:
Net investment income................................. (0.26) (0.31) (0.28) (0.27) (0.08)
In excess of net investment income.................... -- -- -- (0.01) --
Net realized gains.................................... (1.43) (0.54) (0.18) (0.04) --
-------- -------- ------- ------ ------
Total Distributions................................. (1.69) (0.85) (0.46) (0.32) (0.08)
-------- -------- ------- ------ ------
NET ASSET VALUE,
END OF PERIOD......................................... $ 13.87 $ 13.04 $ 11.76 $10.76 $ 9.67
======== ======== ======= ====== ======
Total Return (Excludes Sales Charge).................... 20.95% 18.90% 13.79% 14.90% (5.98)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..................... $114,957 $ 43,900 $18,575 $3,019 $1,862
Ratio of expenses to average net assets............... 1.85% 1.81% 1.94% 2.07% 2.40% (c)
Ratio of net investment income to average net
assets.............................................. 2.01% 2.54% 2.58% 2.77% 1.99% (c)
Ratio of expenses to average net assets*.............. 2.03% 2.01% 2.19% 2.31% 2.40% (c)
Ratio of net investment income to average net
assets*............................................. 1.83% 2.34% 2.33% 2.52% 1.99% (c)
Portfolio turnover (d)................................ 46.04% 80.96% 73.38% 115.36% 56.55%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
115
219
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INCOME EQUITY FUND
--------------------------------------------------------
FIDUCIARY
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD...................................... $ 21.93 $ 17.65 $ 15.13 $ 13.22 $ 13.21
-------- -------- -------- -------- --------
Investment Activities:
Net investment income.................................... 0.32 0.36 0.40 0.40 0.39
Net realized and unrealized gains (losses) from
investments............................................ 4.36 4.89 3.22 2.28 0.01
-------- -------- -------- -------- --------
Total from Investment Activities....................... 4.68 5.25 3.62 2.68 0.40
-------- -------- -------- -------- --------
Distributions:
Net investment income.................................... (0.31) (0.36) (0.40) (0.40) (0.39)
Net realized gains....................................... (2.23) (0.61) (0.70) (0.37) --
-------- -------- -------- -------- --------
Total Distributions.................................... (2.54) (0.97) (1.10) (0.77) (0.39)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................ $ 24.07 $ 21.93 $ 17.65 $ 15.13 $ 13.22
======== ======== ======== ======== ========
Total Return............................................... 23.18% 30.90% 24.53% 21.04% 3.27%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)........................ $691,878 $649,007 $321,827 $170,919 $198,787
Ratio of expenses to average net assets.................. 1.00% 1.00% 0.98% 1.01% 0.98%
Ratio of net investment income to average net assets..... 1.39% 1.91% 2.44% 2.85% 3.18%
Ratio of expenses to average net assets*................. 1.00% 1.00% 1.01% 1.01% 1.05%
Ratio of net investment income to average net assets*.... 1.39% 1.91% 2.41% 2.85% 3.11%
Portfolio turnover (a)................................... 14.64% 28.18% 14.92% 4.03% 22.69%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
116
220
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INCOME EQUITY FUND
----------------------------------------------------
CLASS A
----------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD...................... $ 21.90 $ 17.64 $ 15.11 $ 13.20 $ 13.20
-------- -------- -------- -------- --------
Investment Activities:
Net investment income................................... 0.25 0.31 0.38 0.03 0.36
Net realized and unrealized gains (losses) from
investments........................................... 4.37 4.87 3.20 2.29 --
-------- -------- -------- -------- --------
Total from Investment Activities...................... 4.62 5.18 3.58 2.32 0.36
-------- -------- -------- -------- --------
Distributions:
Net investment income................................... (0.25) (0.31) (0.35) (0.03) (0.34)
In excess of net investment income...................... -- -- -- (0.01) (0.02)
Net realized gains...................................... (2.23) (0.61) (0.70) (0.37) --
-------- -------- -------- -------- --------
Total Distributions................................... (2.48) (0.92) (1.05) (0.41) (0.36)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD........................................... $ 24.04 $ 21.90 $ 17.64 $ 15.11 $ 13.20
======== ======== ======== ======== ========
Total Return (Excludes Sales Charge)...................... 22.91% 30.39% 24.23% 20.79% 2.95%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)....................... $117,682 $ 78,976 $ 44,284 $ 13,793 $ 12,054
Ratio of expenses to average net assets................. 1.25% 1.25% 1.23% 1.26% 1.23%
Ratio of net investment income to average net assets.... 1.15% 1.65% 2.19% 2.61% 3.01%
Ratio of expenses to average net assets*................ 1.35% 1.34% 1.36% 1.36% 1.40%
Ratio of net investment income to average net assets*... 1.05% 1.56% 2.06% 2.51% 2.84%
Portfolio turnover (a).................................. 14.64% 28.18% 14.92% 4.03% 22.69%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
117
221
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INCOME EQUITY FUND
---------------------------------------------------
CLASS B
---------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(a)
-------- ------- ------- ------ -----------
NET ASSET VALUE, BEGINNING OF PERIOD...................... $ 21.95 $ 17.68 $ 15.14 $13.23 $13.83
-------- ------- ------- ------ ------
Investment Activities:
Net investment income................................... 0.26 0.17 0.24 0.26 0.11
Net realized and unrealized gains (losses) from
investments........................................... 4.36 4.89 3.23 2.29 (0.60)
-------- ------- ------- ------ ------
Total from Investment Activities...................... 4.62 5.06 3.47 2.55 (0.49)
-------- ------- ------- ------ ------
Distributions:
Net investment income................................... (0.26) (0.18) (0.23) (0.25) (0.11)
In excess of net investment income...................... -- -- -- (0.02) --
Net realized gains...................................... (2.23) (0.61) (0.70) (0.37) --
-------- ------- ------- ------ ------
Total Distributions................................... (2.49) (0.79) (0.93) (0.64) (0.11)
-------- ------- ------- ------ ------
NET ASSET VALUE,
END OF PERIOD........................................... $ 24.08 $ 21.95 $ 17.68 $15.14 $13.23
======== ======= ======= ====== ======
Total Return (Excludes Sales Charge)...................... 21.97% 29.48% 23.41% 19.91% (3.37)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period(000)........................ $165,813 $79,518 $29,169 $3,468 $1,714
Ratio of expenses to average net assets................. 1.99% 2.00% 1.98% 2.01% 1.95%(c)
Ratio of net investment income to average net assets.... 0.39% 0.89% 1.44% 1.88% 2.70%(c)
Ratio of expenses to average net assets*................ 1.99% 2.00% 2.01% 2.02% 1.95%(c)
Ratio of net investment income to average net assets*... 0.39% 0.89% 1.41% 1.87% 2.70%(c)
Portfolio turnover (d).................................. 14.64% 28.18% 14.92% 4.03% 22.69%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
118
222
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INCOME EQUITY FUND
------------------
CLASS C
------------------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(a)
------------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $21.40
------
Investment Activities:
Net investment income..................................... 0.06
Net realized and unrealized gains (losses) from
investments............................................. 3.39
------
Total from Investment Activities........................ 3.45
------
Distributions:
Net investment income..................................... (0.07)
Net realized gains........................................ (0.70)
------
Total Distributions..................................... (0.77)
------
NET ASSET VALUE,
END OF PERIOD............................................. $24.08
======
Total Return (Excludes Sales Charge)........................ 16.57% (b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period(000).......................... $ 795
Ratio of expenses to average net assets................... 1.98% (c)
Ratio of net investment income to average net assets...... 0.38% (c)
Portfolio turnover (d).................................... 14.64%
- ------------
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
119
223
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
EQUITY INDEX FUND
--------------------------------------------------------
FIDUCIARY
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD...................................... $ 21.80 $ 16.66 $ 14.03 $ 11.59 $ 11.92
-------- -------- -------- -------- --------
Investment Activities:
Net investment income.................................... 0.33 0.35 0.33 0.32 0.29
Net realized and unrealized gains (losses) from
investments............................................ 5.98 5.27 3.16 2.59 (0.20)
-------- -------- -------- -------- --------
Total from Investment Activities....................... 6.31 5.62 3.49 2.91 0.09
-------- -------- -------- -------- --------
Distributions:
Net investment income.................................... (0.32) (0.33) (0.33) (0.29) (0.29)
In excess of net investment income....................... -- -- (0.01) (0.02) (0.04)
Net realized gains....................................... (0.63) (0.15) (0.52) (0.16) (0.09)
-------- -------- -------- -------- --------
Total Distributions.................................... (0.95) (0.48) (0.86) (0.47) (0.42)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................ $ 27.16 $ 21.80 $ 16.66 $ 14.03 $ 11.59
======== ======== ======== ======== ========
Total Return............................................... 29.73% 34.30% 25.47% 25.79% 0.63%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period(000)......................... $671,422 $480,819 $321,058 $234,895 $165,370
Ratio of expenses to average net assets.................. 0.35% 0.30% 0.30% 0.33% 0.46%
Ratio of net investment income to average net assets..... 1.37% 1.87% 2.18% 2.57% 2.44%
Ratio of expenses to average net assets*................. 0.62% 0.61% 0.59% 0.66% 0.59%
Ratio of net investment income to average net assets*.... 1.10% 1.56% 1.89% 2.24% 2.31%
Portfolio turnover (a)................................... 4.32% 5.81% 9.08% 2.71% 11.81%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
120
224
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
EQUITY INDEX FUND
--------------------------------------------------------
CLASS A
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD...................................... $ 21.81 $ 16.67 $ 14.02 $ 11.59 $ 11.91
-------- -------- -------- -------- -------
Investment Activities:
Net investment income.................................... 0.26 0.29 0.27 0.29 0.28
Net realized and unrealized gains (losses) from
investments............................................ 5.97 5.28 3.18 2.58 (0.20)
-------- -------- -------- -------- -------
Total from Investment Activities....................... 6.23 5.57 3.45 2.87 0.08
-------- -------- -------- -------- -------
Distributions:
Net investment income.................................... (0.26) (0.28) (0.27) (0.28) (0.27)
In excess of net investment income....................... -- -- (0.01) -- (0.04)
Net realized gains....................................... (0.63) (0.15) (0.52) (0.16) (0.09)
-------- -------- -------- -------- -------
Total Distributions.................................... (0.89) (0.43) (0.80) (0.44) (0.40)
-------- -------- -------- -------- -------
NET ASSET VALUE,
END OF PERIOD............................................ $ 27.15 $ 21.81 $ 16.67 $ 14.02 $ 11.59
======== ======== ======== ======== =======
Total Return (Excludes Sales Charge)....................... 29.33% 33.94% 25.16% 25.43% 0.56%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)........................ $218,518 $ 98,338 $ 32,186 $ 3,003 $ 1,416
Ratio of expenses to average net assets.................. 0.60% 0.55% 0.55% 0.56% 0.62%
Ratio of net investment income to average net assets..... 1.11% 1.59% 1.93% 2.38% 2.37%
Ratio of expenses to average net assets*................. 0.96% 0.95% 0.94% 1.01% 0.94%
Ratio of net investment income to average net assets*.... 0.75% 1.19% 1.54% 1.94% 2.05%
Portfolio turnover (a)................................... 4.32% 5.81% 9.08% 2.71% 11.81%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
121
225
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
EQUITY INDEX FUND
----------------------------------------------------
CLASS B
----------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
-------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(a)
-------- -------- ------- ------ -----------
NET ASSET VALUE,
BEGINNING OF PERIOD................................... $ 21.80 $ 16.68 $ 14.05 $11.61 $12.39
-------- -------- ------- ------ ------
Investment Activities:
Net investment income................................. 0.10 0.16 0.16 0.18 0.09
Net realized and unrealized gains (losses) from
investments......................................... 5.97 5.27 3.16 2.61 (0.78)
-------- -------- ------- ------ ------
Total from Investment Activities.................... 6.07 5.43 3.32 2.79 (0.69)
-------- -------- ------- ------ ------
Distributions:
Net investment income................................. (0.11) (0.16) (0.16) (0.19) (0.09)
In excess of net investment income.................... -- -- (0.01) -- --
Net realized gains.................................... (0.63) (0.15) (0.52) (0.16) --
-------- -------- ------- ------ ------
Total Distributions................................. (0.74) (0.31) (0.69) (0.35) (0.09)
-------- -------- ------- ------ ------
NET ASSET VALUE,
END OF PERIOD......................................... $ 27.13 $ 21.80 $ 16.68 $14.05 $11.61
======== ======== ======= ====== ======
Total Return (Excludes Sales Charge).................... 28.47% 32.93% 24.05% 24.58% (5.57)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..................... $351,624 $168,699 $38,538 $1,408 $ 248
Ratio of expenses to average net assets............... 1.35% 1.30% 1.30% 1.34% 1.10% (c)
Ratio of net investment income to average net
assets.............................................. 0.36% 0.83% 1.18% 1.60% 2.08% (c)
Ratio of expenses to average net assets*.............. 1.61% 1.61% 1.59% 1.67% 1.15% (c)
Ratio of net investment income to average net
assets*............................................. 0.10% 0.52% 0.89% 1.27% 2.03% (c)
Portfolio turnover (d)................................ 4.32% 5.81% 9.08% 2.71% 11.81%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
122
226
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
EQUITY INDEX FUND
-----------------
CLASS C
-------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(a)
-----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $22.60
------
Investment Activities:
Net investment income..................................... 0.07
Net realized and unrealized gains (losses) from
investments............................................. 4.67
------
Total from Investment Activities........................ 4.74
------
Distributions:
Net investment income..................................... (0.08)
Net realized gains........................................ (0.12)
------
Total Distributions..................................... (0.20)
------
NET ASSET VALUE,
END OF PERIOD............................................. $27.14
======
Total Return (Excludes Sales Charge)........................ 21.07% (b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $3,214
Ratio of expenses to average net assets................... 1.35% (c)
Ratio of net investment income to average net assets...... 0.27% (c)
Ratio of expenses to average net assets*.................. 1.60% (c)
Ratio of net investment income to average net assets*..... 0.02% (c)
Portfolio turnover (d).................................... 4.32%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
123
227
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
VALUE GROWTH FUND
---------------------------------
FIDUCIARY
---------------------------------
MARCH 26,
YEAR ENDED JUNE 30, 1996 TO
------------------- JUNE 30,
1998 1997 1996(a)
-------- -------- -----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 11.51 $ 10.39 $ 10.00
-------- -------- --------
Investment Activities:
Net investment income..................................... 0.08 0.11 0.03
Net realized and unrealized gains (losses) from
investments............................................. 3.36 2.85 0.39
-------- -------- --------
Total from Investment Activities........................ 3.44 2.96 0.42
-------- -------- --------
Distributions:
Net investment income..................................... (0.08) (0.11) (0.03)
Net realized gains........................................ (1.36) (1.73) --
-------- -------- --------
Total Distributions..................................... (1.44) (1.84) (0.03)
-------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................. $ 13.51 $ 11.51 $ 10.39
======== ======== ========
Total Return................................................ 32.26% 31.97% 10.49%(b)(c)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $630,340 $430,837 $191,212
Ratio of expenses to average net assets................... 0.98% 0.98% 0.95%(d)
Ratio of net investment income to average net assets...... 0.66% 1.06% 1.13%(d)
Ratio of expenses to average net assets*.................. 0.98% 1.00% 1.04%(d)
Ratio of net investment income to average net assets*..... 0.66% 1.04% 1.04%(d)
Portfolio turnover (e).................................... 62.37% 113.17% 65.21%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from date reorganized as a fund of The One Group.
(b) Represents total return for Class A Shares from December 1, 1995 through
March 25, 1996 plus total return for Fiduciary Shares for the period from
March 26, 1996 through June 30, 1996.
(c) Not annualized.
(d) Annualized.
(e) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
124
228
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
VALUE GROWTH FUND
------------------------------------------------------------------
CLASS A
------------------------------------------------------------------
SEVEN
MONTHS
YEAR ENDED JUNE 30, ENDED YEAR ENDED NOVEMBER 30,
-------------------- JUNE 30, ------------------------------
1998 1997 1996(a) 1995 1994 1993
-------- -------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD.......................... $ 11.50 $ 10.39 $ 11.15 $ 9.00 $ 10.02 $ 9.42
------- ------- ------- -------- -------- --------
Investment Activities:
Net investment income........................ 0.05 0.09 0.94 0.12 0.13 0.11
Net realized and unrealized gains (losses)
from investments........................... 3.36 2.83 0.08 2.44 (0.56) 0.83
------- ------- ------- -------- -------- --------
Total from Investment Activities........... 3.41 2.92 1.02 2.56 (0.43) 0.94
------- ------- ------- -------- -------- --------
Distributions:
Net investment income........................ (0.05) (0.08) (0.94) (0.12) (0.14) (0.12)
In excess of net investment income........... -- -- (0.01) -- -- --
Net realized gains........................... (1.36) (1.73) (0.83) (0.29) (0.45) (0.22)
------- ------- ------- -------- -------- --------
Total Distributions........................ (1.41) (1.81) (1.78) (0.41) (0.59) (0.34)
------- ------- ------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD................................ $ 13.50 $ 11.50 $ 10.39 $ 11.15 $ 9.00 $ 10.02
======= ======= ======= ======== ======== ========
Total Return (Excludes Sales Charge)........... 31.96% 31.53% 10.40%(b) 29.57% (4.32)% 10.13%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)............ $80,500 $47,306 $35,984 $217,978 $173,198 $171,141
Ratio of expenses to average net assets...... 1.23% 1.23% 0.97%(c) 0.95% 0.96% 0.96%
Ratio of net investment income to average net
assets..................................... 0.40% 0.83% 0.85%(c) 1.25% 1.34% 1.21%
Ratio of expenses to average net assets*..... 1.33% 1.34% 1.05%(c) 0.95% 0.96% 0.96%
Ratio of net investment income to average net
assets*.................................... 0.30% 0.72% 0.77%(c) 1.25% 1.34% 1.21%
Portfolio turnover (d)....................... 62.37% 113.17% 65.21% 77.00% 53.00% 66.00%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Upon reorganizing as a fund of the One Group, the Paragon Value Growth Fund
became the Value Growth Fund. Financial highlights for the periods prior to
March 26, 1996 represent the Paragon Value Growth Fund. The per share data
for the periods prior to March 26, 1996 have been restated to reflect the
impact of restatement of net asset value from $15.26 to $10.00 effective
March 26, 1996.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
125
229
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Value Growth Fund
---------------------------------------------------------------
Class B
---------------------------------------------------------------
SEVEN
Year Ended MONTHS SEPTEMBER 9,
June 30, ENDED YEAR ENDED 1994 TO
------------------ JUNE 30, NOVEMBER 30, NOVEMBER 30,
1998 1997 1996(a) 1995 1994(b)
------- ------- -------- ------------ -------------
NET ASSET VALUE, BEGINNING OF PERIOD................. $ 11.47 $ 10.39 $ 11.16 $ 9.01 $ 9.85
------- ------- ------- ------ -------
Investment Activities:
Net investment income (loss)....................... (0.02) 0.01 0.91 0.05 0.02
Net realized and unrealized gains (losses) from
investments...................................... 3.31 2.82 0.07 2.46 (0.84)
------- ------- ------- ------ -------
Total from Investment Activities................. 3.29 2.83 0.98 2.51 (0.82)
------- ------- ------- ------ -------
Distributions:
Net investment income.............................. -- (0.02) (0.91) (0.07) (0.02)
In excess of net investment income................. -- -- (0.01) -- --
Net realized gains................................. (1.36) (1.73) (0.83) (0.29) --
------- ------- ------- ------ -------
Total Distributions.............................. (1.36) (1.75) (1.75) (0.36) (0.02)
------- ------- ------- ------ -------
NET ASSET VALUE,
END OF PERIOD...................................... $ 13.40 $ 11.47 $ 10.39 $11.16 $ 9.01
======= ======= ======= ====== =======
Total Return (Excludes Sales Charge)................. 30.89% 30.52% 9.96%(c) 28.74% (8.31)%(c)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................. $25,501 $10,517 $ 4,673 $2,923 $ 412
Ratio of expenses to average net assets............ 1.98% 1.98% 1.86%(d) 1.70% 1.71% (d)
Ratio of net investment income to average net
assets........................................... (0.35)% 0.07% 0.13%(d) 0.38% 0.76% (d)
Ratio of expenses to average net assets*........... 1.98% 2.00% 1.94%(d) 1.70% 1.71% (d)
Ratio of net investment income to average net
assets*.......................................... (0.35)% 0.05% 0.05%(d) 0.38% 0.76% (d)
Portfolio turnover (e)............................. 62.37% 113.17% 65.21% 77.00% 53.00%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Upon reorganizing as a fund of the One Group, the Paragon Value Growth Fund
became the Value Growth Fund. Financial highlights for the periods prior to
March 26, 1996 represent the Paragon Value Growth Fund. The per share data
for the periods prior to March 26, 1996 have been restated to reflect the
impact of restatement of net asset value from $15.21 to $10.00 effective
March 26, 1996.
(b) Period from commencement of operations.
(c) Not annualized.
(d) Annualized.
(e) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
126
230
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
VALUE GROWTH FUND
-----------------
CLASS C
-----------------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(a)
-----------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $11.76
------
Investment Activities:
Net realized and unrealized gains (losses) from
investments............................................. 2.35
------
Total from Investment Activities........................ 2.35
------
Distributions:
Net investment income..................................... (0.01)
Net realized gains........................................ (0.63)
------
Total Distributions..................................... (0.64)
------
NET ASSET VALUE,
END OF PERIOD............................................. $13.47
======
Total Return (Excludes Sales Charge)........................ 20.87%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $1,234
Ratio of expenses to average net assets................... 1.99% (c)
Ratio of net investment income to average net assets...... (0.43)%(c)
Portfolio turnover (d).................................... 62.37%
- ------------
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
127
231
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LARGE COMPANY VALUE FUND
----------------------------------------------------------------
FIDUCIARY
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD.................... $ 14.79 $ 12.83 $ 12.87 $ 11.34 $ 11.64
-------- -------- -------- -------- --------
Investment Activities:
Net investment income................................. 0.21 0.27 0.31 0.31 0.20
Net realized and unrealized gains (losses) from
investments......................................... 2.84 3.01 1.20 2.18 (0.01)
-------- -------- -------- -------- --------
Total from Investment Activities.................... 3.05 3.28 1.51 2.49 0.19
-------- -------- -------- -------- --------
Distributions:
Net investment income................................. (0.21) (0.26) (0.31) (0.32) (0.19)
Net realized gains.................................... (0.93) (1.06) (1.24) (0.64) (0.30)
-------- -------- -------- -------- --------
Total Distributions................................. (1.14) (1.32) (1.55) (0.96) (0.49)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD......................................... $ 16.70 $ 14.79 $ 12.83 $ 12.87 $ 11.34
======== ======== ======== ======== ========
Total Return............................................ 21.46% 27.10% 12.71% 23.42% (1.59)%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..................... $792,649 $686,156 $584,527 $365,376 $169,127
Ratio of expenses to average net assets............... 0.95% 0.97% 0.97% 1.00% 0.95%
Ratio of net investment income to average net
assets.............................................. 1.34% 1.99% 2.43% 2.74% 1.72%
Ratio of expenses to average net assets*.............. 0.95% 0.97% 0.98% 1.01% 1.02%
Ratio of net investment income to average net
assets*............................................. 1.34% 1.99% 2.42% 2.73% 1.65%
Portfolio turnover (a)................................ 47.35% 77.05% 186.84% 203.13% 111.72%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
128
232
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LARGE COMPANY VALUE FUND
--------------------------------------------------------
CLASS A
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------ ------ ------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 14.85 $ 12.87 $12.89 $11.34 $11.64
------- ------- ------ ------ ------
Investment Activities:
Net investment income..................................... 0.18 0.23 0.27 0.28 0.17
Net realized and unrealized gains (losses) from
investments............................................. 2.84 3.04 1.22 2.20 (0.01)
------- ------- ------ ------ ------
Total from Investment Activities........................ 3.02 3.27 1.49 2.48 0.16
------- ------- ------ ------ ------
Distributions:
Net investment income..................................... (0.17) (0.23) (0.27) (0.27) (0.16)
In excess of net investment income........................ -- -- -- (0.02) --
Net realized gains........................................ (0.93) (1.06) (1.24) (0.64) (0.30)
------- ------- ------ ------ ------
Total Distributions..................................... (1.10) (1.29) (1.51) (0.93) (0.46)
------- ------- ------ ------ ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 16.77 $ 14.85 $12.87 $12.89 $11.34
======= ======= ====== ====== ======
Total Return (Excludes Sales Charge)........................ 21.14% 26.90% 12.40% 22.64% 1.35%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $15,699 $14,832 $9,380 $3,481 $ 698
Ratio of expenses to average net assets................... 1.20% 1.22% 1.22% 1.25% 1.20%
Ratio of net investment income to average net assets...... 1.10% 1.72% 2.18% 2.52% 1.57%
Ratio of expenses to average net assets*.................. 1.30% 1.31% 1.33% 1.37% 1.37%
Ratio of net investment income to average net assets*..... 1.00% 1.63% 2.07% 2.41% 1.40%
Portfolio turnover (a).................................... 47.35% 77.05% 186.84% 203.13% 111.72%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
129
233
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LARGE COMPANY VALUE FUND
------------------------------------------------------------
CLASS B
------------------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
------------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(a)
------- ------ ------ ------ -----------
NET ASSET VALUE,
BEGINNING OF PERIOD..................................... $ 14.95 $12.98 $12.96 $11.41 $11.87
------- ------ ------ ------ ------
Investment Activities:
Net investment income................................... 0.07 0.14 0.18 0.17 0.05
Net realized and unrealized gains (losses) from
investments........................................... 2.84 3.04 1.26 2.19 (0.46)
------- ------ ------ ------ ------
Total from Investment Activities...................... 2.91 3.18 1.44 2.36 (0.41)
------- ------ ------ ------ ------
Distributions:
Net investment income................................... (0.09) (0.15) (0.18) (0.17) (0.05)
Net realized gains...................................... (0.93) (1.06) (1.24) (0.64) --
------- ------ ------ ------ ------
Total Distributions................................... (1.02) (1.21) (1.42) (0.81) (0.05)
------- ------ ------ ------ ------
NET ASSET VALUE,
END OF PERIOD........................................... $ 16.84 $14.95 $12.98 $12.96 $11.41
======= ====== ====== ====== ======
Total Return (Excludes Sales Charge)...................... 20.18% 25.86% 11.95% 22.28% 3.48% (b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)....................... $17,154 $9,288 $4,135 $ 861 $ 182
Ratio of expenses to average net assets................. 1.95% 1.97% 1.97% 2.00% 2.00% (c)
Ratio of net investment income to average net assets.... 0.33% 0.96% 1.43% 1.74% 1.06% (c)
Ratio of expenses to average net assets*................ 1.95% 1.97% 1.98% 2.01% 2.00% (c)
Ratio of net investment income to average net assets*... 0.33% 0.96% 1.42% 1.72% 1.06% (c)
Portfolio turnover (d).................................. 47.35% 77.05% 186.84% 203.13% 111.72%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
130
234
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
DISCIPLINED VALUE FUND
----------------------------------------------------------------
FIDUCIARY
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD................................... $ 15.65 $ 14.69 $ 13.20 $ 11.90 $ 12.76
-------- -------- -------- -------- --------
Investment Activities:
Net investment income................................. 0.14 0.22 0.29 0.28 0.26
Net realized and unrealized gains from investments.... 3.99 2.57 2.27 1.57 0.29
-------- -------- -------- -------- --------
Total from Investment Activities.................... 4.13 2.79 2.56 1.85 0.55
-------- -------- -------- -------- --------
Distributions:
Net investment income................................. (0.14) (0.22) (0.29) (0.27) (0.26)
Net realized gains.................................... (2.74) (1.61) (0.78) (0.28) (1.15)
-------- -------- -------- -------- --------
Total Distributions................................. (2.88) (1.83) (1.07) (0.55) (1.41)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD......................................... $ 16.90 $ 15.65 $ 14.69 $ 13.20 $ 11.90
======== ======== ======== ======== ========
Total Return............................................ 28.27% 20.56% 20.10% 16.03% 4.04%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..................... $634,672 $562,302 $522,474 $448,530 $418,238
Ratio of expenses to average net assets............... 0.96% 0.98% 0.99% 1.00% 0.93%
Ratio of net investment income to average net
assets.............................................. 0.85% 1.52% 2.04% 2.21% 2.14%
Ratio of expenses to average net assets*.............. 0.96% 0.98% 1.00% 1.10% 0.98%
Ratio of net investment income to average net
assets*............................................. 0.85% 1.52% 2.03% 2.11% 2.09%
Portfolio turnover (a)................................ 106.41% 92.66% 90.55% 176.66% 56.33%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
131
235
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
DISCIPLINED VALUE FUND
-----------------------------------------------------------
CLASS A
-----------------------------------------------------------
YEAR ENDED JUNE 30,
-----------------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 15.68 $ 14.72 $ 13.22 $ 11.91 $ 12.75
------- ------- ------- ------- -------
Investment Activities:
Net investment income..................................... 0.10 0.19 0.25 0.24 0.24
Net realized and unrealized gains from investments........ 3.99 2.57 2.28 1.59 0.30
------- ------- ------- ------- -------
Total from Investment Activities........................ 4.09 2.76 2.53 1.83 0.54
------- ------- ------- ------- -------
Distributions:
Net investment income..................................... (0.10) (0.19) (0.25) (0.24) (0.23)
Net realized gains........................................ (2.74) (1.61) (0.78) (0.26) (1.10)
In excess of net realized gains........................... -- -- -- (0.02) (0.05)
------- ------- ------- ------- -------
Total Distributions..................................... (2.84) (1.80) (1.03) (0.52) (1.38)
------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 16.93 $ 15.68 $ 14.72 $ 13.22 $ 11.91
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)........................ 27.90% 20.21% 19.80% 15.43% 3.95%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $29,443 $23,909 $20,838 $13,560 $10,448
Ratio of expenses to average net assets................... 1.21% 1.23% 1.24% 1.26% 1.18%
Ratio of net investment income to average net assets...... 0.60% 1.26% 1.79% 1.99% 2.00%
Ratio of expenses to average net assets*.................. 1.31% 1.31% 1.35% 1.36% 1.33%
Ratio of net investment income to average net assets*..... 0.50% 1.18% 1.68% 1.89% 1.85%
Portfolio turnover (a).................................... 106.41% 92.66% 90.55% 176.66% 56.33%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
132
236
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
DISCIPLINED VALUE FUND
-------------------------------------------------------
CLASS B
-------------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
---------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(a)
------- ------- ------- ------- -----------
NET ASSET VALUE,
BEGINNING OF PERIOD..................................... $ 15.64 $ 14.69 $ 13.19 $ 11.90 $12.60
------- ------- ------- ------- ------
Investment Activities:
Net investment income (loss)............................ (0.02) 0.08 0.15 0.15 0.07
Net realized and unrealized gains (losses) from
investments........................................... 3.98 2.55 2.27 1.58 (0.70)
------- ------- ------- ------- ------
Total from Investment Activities...................... 3.96 2.63 2.42 1.73 (0.63)
------- ------- ------- ------- ------
Distributions:
Net investment income................................... (0.01) (0.07) (0.14) (0.15) (0.06)
In excess of net investment income...................... -- -- -- (0.01) (0.01)
Net realized gains...................................... (2.74) (1.61) (0.78) (0.28) --
------- ------- ------- ------- ------
Total Distributions................................... (2.75) (1.68) (0.92) (0.44) (0.07)
------- ------- ------- ------- ------
NET ASSET VALUE,
END OF PERIOD........................................... $ 16.85 $ 15.64 $ 14.69 $ 13.19 $11.90
======= ======= ======= ======= ======
Total Return (Excludes Sales Charge).................. 26.97% 19.19% 18.93% 14.92% (5.00)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)....................... $30,094 $20,499 $16,305 $11,222 $5,356
Ratio of expenses to average net assets................. 1.96% 1.98% 1.99% 2.00% 1.96% (c)
Ratio of net investment income to average net assets.... (0.15)% 0.51% 1.04% 1.26% 1.80% (c)
Ratio of expenses to average net assets*................ 1.96% 1.98% 2.00% 2.01% 1.96% (c)
Ratio of net investment income to average net assets*... (0.15)% 0.51% 1.03% 1.25% 1.80% (c)
Portfolio turnover (d).................................. 106.41% 92.66% 90.55% 176.66% 56.33%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
133
237
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LARGE COMPANY GROWTH FUND
--------------------------------------------------------------------
FIDUCIARY
--------------------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------------------
1998 1997 1996 1995 1994
---------- ---------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD................................ $ 19.44 $ 15.44 $ 13.47 $ 11.32 $ 10.92
---------- ---------- -------- -------- --------
Investment Activities:
Net investment income.............................. 0.04 0.12 0.18 0.20 0.20
Net realized and unrealized gains from
investments...................................... 6.13 4.79 2.14 3.04 0.67
---------- ---------- -------- -------- --------
Total from Investment Activities................. 6.17 4.91 2.32 3.24 0.87
---------- ---------- -------- -------- --------
Distributions:
Net investment income.............................. (0.02) (0.11) (0.18) (0.20) (0.20)
Net realized gains................................. (2.88) (0.80) (0.17) (0.89) (0.27)
---------- ---------- -------- -------- --------
Total Distributions.............................. (2.90) (0.91) (0.35) (1.09) (0.47)
---------- ---------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD...................................... $ 22.71 $ 19.44 $ 15.44 $ 13.47 $ 11.32
========== ========== ======== ======== ========
Total Return......................................... 35.75% 33.11% 17.36% 21.85% 8.04%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................. $1,510,521 $1,142,864 $745,986 $531,595 $150,035
Ratio of expenses to average net assets............ 0.99% 0.99% 0.96% 1.00% 0.78%
Ratio of net investment income to average net
assets........................................... 0.21% 0.69% 1.20% 1.72% 1.87%
Ratio of expenses to average net assets*........... 0.99% 0.99% 0.99% 1.00% 1.13%
Ratio of net investment income to average net
assets*.......................................... 0.21% 0.69% 1.17% 1.72% 1.52%
Portfolio turnover (a)............................. 117.34% 57.17% 35.51% 14.22% 9.04%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
134
238
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LARGE COMPANY GROWTH FUND
----------------------------------------------------------
CLASS A
----------------------------------------------------------
FEBRUARY 22,
YEAR ENDED JUNE 30, 1994 TO
------------------------------------------ JUNE 30,
1998 1997 1996 1995 1994(a)
-------- -------- ------- ------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD.................................. $ 19.92 $ 15.83 $ 13.83 $ 11.62 $11.78
-------- -------- ------- ------- ------
Investment Activities:
Net investment income (loss)......................... (0.01) 0.08 0.14 0.17 0.04
Net realized and unrealized gains (losses) from
investments........................................ 6.30 4.88 2.17 3.10 (0.16)
-------- -------- ------- ------- ------
Total from Investment Activities..................... 6.29 4.96 2.31 3.27 (0.12)
-------- -------- ------- ------- ------
Distributions:
Net investment income................................ -- (0.07) (0.14) (0.16) (0.04)
In excess of net investment income................... (0.01) -- -- (0.01) --
Net realized gains................................... (2.88) (0.80) (0.17) (0.89) --
-------- -------- ------- ------- ------
Total Distributions................................ (2.89) (0.87) (0.31) (1.06) (0.04)
-------- -------- ------- ------- ------
NET ASSET VALUE,
END OF PERIOD........................................ $ 23.32 $ 19.92 $ 15.83 $ 13.83 $11.62
======== ======== ======= ======= ======
Total Return (Excludes Sales Charge)................... 35.43% 32.57% 16.85% 21.52% (1.02)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $199,052 $125,910 $75,114 $27,428 $ 368
Ratio of expenses to average net assets.............. 1.24% 1.24% 1.21% 1.26% 1.25% (c)
Ratio of net investment income to average net
assets............................................. (0.04)% 0.44% 0.95% 1.49% 1.78% (c)
Ratio of expenses to average net assets*............. 1.34% 1.32% 1.34% 1.36% 1.35% (c)
Ratio of net investment income to average net
assets*............................................ (0.14)% 0.36% 0.82% 1.39% 1.68% (c)
Portfolio turnover (d)............................... 117.34% 57.17% 35.51% 14.22% 9.04%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
135
239
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LARGE COMPANY GROWTH FUND
---------------------------------------------------------
CLASS B
---------------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
------------------------------------------ JUNE 30,
1998 1997 1996 1995 1994(a)
-------- -------- ------- ------- -----------
NET ASSET VALUE,
BEGINNING OF PERIOD................................... $ 19.61 $ 15.63 $ 13.63 $ 11.47 $11.57
-------- -------- ------- ------- ------
Investment Activities:
Net investment income (loss).......................... (0.10) (0.04) 0.05 0.09 0.03
Net realized and unrealized gains (losses) from
investments......................................... 6.10 4.82 2.17 3.06 (0.10)
-------- -------- ------- ------- ------
Total from Investment Activities.................... 6.00 4.78 2.22 3.15 (0.07)
-------- -------- ------- ------- ------
Distributions:
Net investment income................................. -- -- (0.05) (0.09) (0.03)
In excess of net investment income -- -- -- (0.01) --
Net realized gains.................................... (2.88) (0.80) (0.17) (0.89) --
-------- -------- ------- ------- ------
Total Distributions................................. (2.88) (0.80) (0.22) (0.99) (0.03)
-------- -------- ------- ------- ------
NET ASSET VALUE,
END OF PERIOD......................................... $ 22.73 $ 19.61 $ 15.63 $ 13.63 $11.47
======== ======== ======= ======= ======
Total Return (Excludes Sales Charge).................... 34.39% 31.74% 16.41% 20.65% (0.66)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000) $280,563 $132,268 $56,261 $ 6,918 $ 334
Ratio of expenses to average net assets............... 1.99% 2.00% 1.96% 2.01% 1.99% (c)
Ratio of net investment income to average net assets (0.80)% (0.33)% 0.20% 0.74% 0.96% (c)
Ratio of expenses to average net assets*.............. 1.99% 2.00% 1.99% 2.01% 1.99% (c)
Ratio of net investment income to average net assets* (0.80)% (0.33)% 0.17% 0.74% 0.96% (c)
Portfolio turnover (d)................................ 117.34% 57.17% 35.51% 14.22% 9.04%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
136
240
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LARGE COMPANY
GROWTH FUND
-------------
CLASS C
-------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(a)
-----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $18.98
------
Investment Activities:
Net investment income (loss).............................. (0.06)
Net realized and unrealized gains from investments........ 4.99
------
Total from Investment Activities........................ 4.93
------
Distributions:
Net realized gains........................................ (1.34)
------
Total Distributions..................................... (1.34)
------
NET ASSET VALUE,
END OF PERIOD............................................. $22.57
======
Total Return (Excludes Sales Charge)........................ 27.63% (b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 492
Ratio of expenses to average net assets................... 1.98% (c)
Ratio of net investment income to average net assets...... (0.87)%(c)
Portfolio turnover (d).................................... 117.34%
- ------------
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
137
241
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GROWTH OPPORTUNITIES FUND
----------------------------------------------------------------
FIDUCIARY
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD................... $ 19.46 $ 18.81 $ 18.40 $ 15.96 $ 16.96
-------- -------- -------- -------- --------
Investment Activities:
Net investment income (loss)......................... (0.07) 0.25 0.20 0.06 0.07
Net realized and unrealized gains (losses) from
investments........................................ 5.70 3.59 3.83 2.98 (0.05)
-------- -------- -------- -------- --------
Total from Investment Activities................... 5.63 3.84 4.03 3.04 0.02
-------- -------- -------- -------- --------
Distributions:
Net investment income................................ -- (0.25) (0.20) (0.06) (0.07)
In excess of net investment income................... -- (0.02) -- -- --
Net realized gains................................... (2.58) (2.92) (3.42) (0.54) (0.95)
-------- -------- -------- -------- --------
Total Distributions................................ (2.58) (3.19) (3.62) (0.60) (1.02)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD......................... $ 22.51 $ 19.46 $ 18.81 $ 18.40 $ 15.96
======== ======== ======== ======== ========
Total Return........................................... 31.11% 22.75% 24.63% 19.75% (0.16)%
Ratios/Supplementary Data:
Net Assets at end of period (000).................... $868,901 $623,911 $532,525 $413,518 $389,567
Ratio of expenses to average net assets.............. 1.00% 0.99% 1.00% 0.98% 0.98%
Ratio of net investment income to average net
assets............................................. (0.36)% 1.32% 1.15% 0.38% 0.42%
Ratio of expenses to average net assets*............. 1.00% 0.99% 1.01% 0.98% 1.03%
Ratio of net investment income to average net
assets*............................................ (0.36)% 1.32% 1.14% 0.38% 0.37%
Portfolio turnover (a)............................... 158.43% 301.35% 435.30% 132.63% 70.67%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
138
242
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GROWTH OPPORTUNITIES FUND
-----------------------------------------------------------
CLASS A
-----------------------------------------------------------
YEAR ENDED JUNE 30,
-----------------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 19.37 $ 18.76 $ 18.36 $ 15.93 $ 16.96
------- ------- ------- ------- -------
Investment Activities:
Net investment income (loss).............................. (0.08) 0.21 0.17 0.02 0.04
Net realized and unrealized gains (losses) from
investments............................................. 5.65 3.58 3.80 2.98 (0.08)
------- ------- ------- ------- -------
Total from Investment Activities........................ 5.57 3.79 3.97 3.00 (0.04)
------- ------- ------- ------- -------
Distributions:
Net investment income..................................... -- (0.24) (0.15) (0.01) (0.03)
In excess of net investment income........................ -- (0.02) -- (0.02) (0.01)
Net realized gains........................................ (2.58) (2.92) (3.42) (0.54) (0.95)
------- ------- ------- ------- -------
Total Distributions..................................... (2.58) (3.18) (3.57) (0.57) (0.99)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD.............................. $ 22.36 $ 19.37 $ 18.76 $ 18.36 $ 15.93
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)........................ 30.95% 22.52% 24.32% 19.50% (0.52)%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $95,647 $43,370 $28,052 $11,178 $ 8,097
Ratio of expenses to average net assets................... 1.25% 1.25% 1.25% 1.23% 1.22%
Ratio of net investment income to average net assets...... (0.60)% 0.92% 0.90% 0.12% 0.27%
Ratio of expenses to average net assets*.................. 1.35% 1.34% 1.36% 1.33% 1.38%
Ratio of net investment income to average net assets*..... (0.70)% 0.83% 0.79% 0.02% 0.11%
Portfolio turnover (a).................................... 158.43% 301.35% 435.30% 132.63% 70.67%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
139
243
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GROWTH OPPORTUNITIES FUND
-------------------------------------------------------
CLASS B
-------------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
----------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(a)
-------- -------- -------- -------- -----------
NET ASSET VALUE, BEGINNING OF PERIOD................... $ 18.82 $ 18.43 $ 18.14 $ 15.85 $ 17.44
-------- -------- -------- -------- --------
Investment Activities:
Net investment income (loss)......................... (0.15) 0.11 0.09 (0.07) (0.02)
Net realized and unrealized gains (losses) from
investments........................................ 5.35 3.44 3.69 2.90 (1.56)
-------- -------- -------- -------- --------
Total from Investment Activities................... 5.20 3.55 3.78 2.83 (1.58)
-------- -------- -------- -------- --------
Distributions:
Net investment income................................ -- (0.22) (0.07) -- (0.01)
In excess of net investment income................... -- (0.02) -- -- --
Net realized gains................................... (2.58) (2.92) (3.42) (0.54) --
-------- -------- -------- -------- --------
Total Distributions................................ (2.58) (3.16) (3.49) (0.54) (0.01)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD........................................ $ 21.44 $ 18.82 $ 18.43 $ 18.14 $ 15.85
======== ======== ======== ======== ========
Total Return (Excludes Sales Charge)................... 29.79% 21.73% 23.53% 18.47% (9.07)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $ 90,930 $ 37,409 $ 12,910 $ 2,787 $ 1,131
Ratio of expenses to average net assets.............. 2.00% 2.00% 2.00% 1.98% 2.12%(c)
Ratio of net investment income to average net
assets............................................. (1.35)% 0.01% 0.15% (0.63)% (0.55)%(c)
Ratio of expenses to average net assets*............. 2.00% 2.00% 2.01% 1.98% 2.12%(c)
Ratio of net investment income to average net
assets*............................................ (1.35)% 0.01% 0.14% (0.63)% (0.55)%(c)
Portfolio turnover (d)............................... 158.43% 301.35% 435.30% 132.63% 70.67%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
140
244
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GROWTH
OPPORTUNITIES
FUND
-------------
CLASS C
-------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(a)
-----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $21.47
------
Investment Activities:
Net investment income (loss).............................. (0.04)
Net realized and unrealized gains from investments........ 2.77
------
Total from Investment Activities........................ 2.73
------
Distributions:
Net realized gains........................................ (1.78)
------
Total Distributions......................................... (1.78)
------
NET ASSET VALUE,
END OF PERIOD............................................. $22.42
======
Total Return (Excludes Sales Charge)........................ 14.27% (b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $1,088
Ratio of expenses to average net assets................... 2.01% (c)
Ratio of net investment income to average net assets...... (1.31)%(c)
Portfolio turnover (d).................................... 158.43%
- ------------
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
141
245
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
SMALL CAPITALIZATION FUND
----------------------------------
FIDUCIARY
----------------------------------
MARCH 26,
YEAR ENDED JUNE 30, 1996 TO
--------------------- JUNE 30,
1998 1997 1996(a)
-------- ------- ---------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.94 $ 10.75 $ 10.00
-------- ------- -------
Investment Activities:
Net investment income (loss).............................. -- (0.02) --
Net realized and unrealized gains (losses) from
investments............................................. 2.44 1.31 0.78
-------- ------- -------
Total from Investment Activities........................ 2.44 1.29 0.78
-------- ------- -------
Distributions:
Net realized gains........................................ (1.33) (1.10) (0.03)
-------- ------- -------
Total Distributions..................................... (1.33) (1.10) (0.03)
-------- ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 12.05 $ 10.94 $ 10.75
======== ======= =======
Total Return................................................ 23.58% 13.44% 13.39%(b)(c)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $114,951 $78,318 $83,371
Ratio of expenses to average net assets................... 1.06% 1.02% 0.96%(d)
Ratio of net investment income to average net assets...... (0.05)% (0.16)% (0.16)%(d)
Ratio of expenses to average net assets*.................. 1.09% 1.12% 1.05%(d)
Ratio of net investment income to average net assets*..... (0.08)% (0.26)% (0.25)%(d)
Portfolio turnover (e).................................... 83.77% 92.01% 59.57%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from date reorganized as a fund of The One Group.
(b) Not annualized.
(c) Represents total return for Class A Shares from December 1, 1995 through
March 25, 1996 plus total return for Fiduciary Shares for the period from
March 26, 1996 through June 30, 1996.
(d) Annualized.
(e) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
142
246
- --------------------------------------------------------------------------------
The One Group Family Of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
SMALL CAPITALIZATION FUND
------------------------------------------------------------------------------
CLASS A
------------------------------------------------------------------------------
YEAR ENDED SEVEN MONTHS
JUNE 30, ENDED YEAR ENDED NOVEMBER 30,
-------------------- JUNE 30, ---------------------------------
1998 1997 1996(a) 1995 1994 1993
------- ------- ------------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................... $ 10.94 $ 10.73 $ 11.50 $ 9.36 $ 10.11 $ 9.48
------- ------- ------- ------- ------- -------
Investment Activities:
Net investment income (loss).............. (0.03) (0.04) (0.07) (0.04) (0.04) (0.02)
Net realized and unrealized gains (losses)
from investments........................ 2.44 1.35 1.40 2.35 (0.63) 0.88
------- ------- ------- ------- ------- -------
Total from Investment Activities........ 2.41 1.31 1.33 2.31 (0.67) 0.86
------- ------- ------- ------- ------- -------
Distributions:
Net investment income..................... -- -- -- -- -- (0.01)
Net realized gains........................ (1.33) (1.10) (2.10) (0.17) (0.08) (0.22)
------- ------- ------- ------- ------- -------
Total Distributions..................... (1.33) (1.10) (2.10) (0.17) (0.08) (0.23)
------- ------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD............................. $ 12.02 $ 10.94 $ 10.73 $ 11.50 $ 9.36 $ 10.11
======= ======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)........ 23.28% 13.52% 12.85% (b) 25.07% (6.66)% 9.10%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......... $21,634 $17,299 $18,356 $95,467 $77,540 $74,982
Ratio of expenses to average net assets... 1.31% 1.27% 1.05% (c) 1.03% 1.00% 1.01%
Ratio of net investment income to average
net assets.............................. (0.31)% (0.41)% (0.33)%(c) (0.36)% (0.38)% (0.21)%
Ratio of expenses to average net
assets*................................. 1.44% 1.45% 1.07% (c) 1.03% 1.00% 1.01%
Ratio of net investment income to average
net assets*............................. (0.44)% (0.59)% (0.35) (c) (0.36)% (0.38)% (0.21)%
Portfolio turnover (d).................... 83.77% 92.01% 59.57% 65.00% 51.00% 59.00%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Upon reorganizing as a fund of The One Group, the Paragon Gulf South Growth
Fund became the Gulf South Growth Fund. Financial highlights for the periods
prior to March 26, 1996 represents the Paragon Gulf South Growth Fund. The
per share data for the periods prior to March 26, 1996 have been restated to
reflect the impact of restatement of net asset value from $15.70 to $10.00
effective March 26, 1996.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
143
247
- --------------------------------------------------------------------------------
The One Group Family Of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
SMALL CAPITALIZATION FUND
--------------------------------------------------------------------------
CLASS B
--------------------------------------------------------------------------
YEAR ENDED SEVEN MONTHS YEAR SEPTEMBER 12,
JUNE 30, ENDED ENDED 1994 TO
------------------ JUNE 30, NOVEMBER 30, NOVEMBER 30,
1998 1997 1996(a) 1995 1994(b)
------ ------ ------------- ------------ -------------
NET ASSET VALUE,
BEGINNING OF PERIOD......................... $10.84 $10.72 $11.56 $ 9.47 $10.40
------ ------ ------ ------ ------
Investment Activities:
Net investment income (loss)................ (0.03) (0.10) (0.06) (0.07) (0.01)
Net realized and unrealized gains (losses)
from investments.......................... 2.31 1.32 1.35 2.33 (0.92)
------ ------ ------ ------ ------
Total from Investment Activities.......... 2.28 1.22 1.29 2.26 (0.93)
------ ------ ------ ------ ------
Distributions:
Net realized gains.......................... (1.33) (1.10) (2.13) (0.17) --
------ ------ ------ ------ ------
Total Distributions....................... (1.33) (1.10) (2.13) (0.17) --
------ ------ ------ ------ ------
NET ASSET VALUE,
END OF PERIOD............................... $11.79 $10.84 $10.72 $11.56 $ 9.47
====== ====== ====== ====== ======
Total Return (Excludes Sales Charge).......... 22.24% 12.74% 12.47% (c) 24.21% (9.08)%(c)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)........... $8,567 $3,835 $2,545 $1,814 $ 231
Ratio of expenses to average net assets..... 2.06% 2.02% 1.87% (d) 1.78% 1.75% (d)
Ratio of net investment income to average
net assets................................ (1.02)% (1.16)% (1.10)%(d) (1.16)% (0.90)%(d)
Ratio of expenses to average net assets*.... 2.09% 2.12% 1.92% (d) 1.78% 1.75% (d)
Ratio of net investment income to average
net assets*............................... (1.05)% (1.26)% (1.15)%(d) (1.16)% (0.90)%(d)
Portfolio turnover (e)...................... 83.77% 92.01% 59.57% 65.00% 51.00%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Upon reorganizing as a fund of The One Group, the Paragon Gulf South Growth
Fund became the Gulf South Growth Fund. Financial highlights for the periods
prior to March 26, 1996 represents the Paragon Gulf South Growth Fund. The
per share data for the periods prior to March 26, 1996 have been restated to
reflect the impact of restatement of net asset value from $15.48 to $10.00
effective March 26, 1996.
(b) Class B Shares commenced offering September 12, 1994.
(c) Not annualized.
(d) Annualized.
(e) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
144
248
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
SMALL CAPITALIZATION FUND
-------------------------
CLASS C
-------------------------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(a)
-------------------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 13.03
--------
Investment Activities:
Net investment income (loss).............................. (0.02)
Net realized and unrealized gains (losses) from
investments............................................. 0.29
--------
Total from Investment Activities........................ 0.27
--------
Distributions:
Net realized gains........................................ (1.33)
--------
Total Distributions..................................... (1.33)
--------
NET ASSET VALUE,
END OF PERIOD............................................. $ 11.97
========
Total Return (Excludes Sales Charge)........................ 3.08%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 90
Ratio of expenses to average net assets................... 2.05% (c)
Ratio of net investment income to average net assets...... (0.85)%(c)
Ratio of expenses to average net assets*.................. 2.07% (c)
Ratio of net investment income to average net assets*..... (0.87)%(c)
Portfolio turnover (d).................................... 83.77%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
145
249
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERNATIONAL EQUITY INDEX FUND
----------------------------------------------------------------
FIDUCIARY
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD.................... $ 16.89 $ 15.17 $ 13.93 $ 13.46 $ 11.80
-------- -------- -------- -------- --------
Investment Activities:
Net investment income................................. 0.21 0.15 0.11 0.13 0.11
Net realized and unrealized gains (losses) from
investments......................................... 1.32 2.02 1.43 0.46 1.68
-------- -------- -------- -------- --------
Total from Investment Activities.................... 1.53 2.17 1.54 0.59 1.79
-------- -------- -------- -------- --------
Distributions:
Net investment income................................. (0.02) (0.17) (0.16) (0.08) (0.11)
In excess of net investment income.................... -- (0.13) (0.02) -- --
Net realized gains.................................... (0.43) (0.15) (0.12) (0.04) (0.01)
In excess of net realized gains....................... -- -- -- -- (0.01)
-------- -------- -------- -------- --------
Total Distributions................................. (0.45) (0.45) (0.30) (0.12) (0.13)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD.......................... $ 17.97 $ 16.89 $ 15.17 $ 13.93 $ 13.46
======== ======== ======== ======== ========
Total Return............................................ 9.54% 14.64% 11.22% 4.20% 15.44%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..................... $586,741 $449,949 $347,790 $218,299 $145,640
Ratio of expenses to average net assets............... 0.88% 0.86% 0.97% 1.04% 1.02%
Ratio of net investment income to average net
assets.............................................. 1.29% 1.00% 1.04% 1.25% 1.27%
Ratio of expenses to average net assets*.............. 0.88% 0.86% 1.00% 1.04% 1.02%
Ratio of net investment income to average net
assets*............................................. 1.29% 1.00% 1.01% 1.25% 1.27%
Portfolio turnover (a)................................ 9.90% 9.61% 6.28% 4.67% 7.74%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
146
250
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERNATIONAL EQUITY INDEX FUND
---------------------------------------------------------
CLASS A
---------------------------------------------------------
YEAR ENDED JUNE 30,
---------------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------ ------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 16.92 $ 15.16 $ 13.92 $13.49 $11.80
------- ------- ------- ------ ------
Investment Activities:
Net investment income..................................... 0.19 0.11 0.14 0.12 0.09
Net realized and unrealized gains (losses) from
investments............................................. 1.31 2.03 1.40 0.43 1.67
------- ------- ------- ------ ------
Total from Investment Activities........................ 1.50 2.14 1.54 0.55 1.76
------- ------- ------- ------ ------
Distributions:
Net investment income..................................... -- (0.13) (0.16) (0.08) (0.05)
In excess of net investment income........................ -- (0.10) (0.02) -- --
Net realized gains........................................ (0.43) (0.15) (0.12) (0.04) (0.02)
------- ------- ------- ------ ------
Total Distributions..................................... (0.43) (0.38) (0.30) (0.12) (0.07)
------- ------- ------- ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $ 17.99 $ 16.92 $ 15.16 $13.92 $13.49
======= ======= ======= ====== ======
Total Return (Excludes Sales Charge)........................ 9.34% 14.31% 11.20% 3.87% 15.18%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $24,060 $12,562 $10,789 $5,028 $2,395
Ratio of expenses to average net assets................... 1.13% 1.11% 1.22% 1.28% 1.26%
Ratio of net investment income to average net assets...... 1.11% 0.73% 0.79% 1.09% 1.15%
Ratio of expenses to average net assets*.................. 1.23% 1.19% 1.35% 1.38% 1.36%
Ratio of net investment income to average net assets*..... 1.01% 0.65% 0.66% 0.99% 1.05%
Portfolio turnover (a).................................... 9.90% 9.61% 6.28% 4.67% 7.74%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
147
251
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERNATIONAL EQUITY INDEX FUND
-------------------------------------------------------------
CLASS B
-------------------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
-------------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(a)
------- ------- ------ ------ -----------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 16.44 $ 14.79 $13.73 $13.40 $13.00
------- ------- ------ ------ ------
Investment Activities:
Net investment income (loss).............................. 0.08 0.09 0.03 0.03 0.06
Net realized and unrealized gains from investments
(losses)................................................ 1.24 1.86 1.32 0.41 0.34
------- ------- ------ ------ ------
Total from Investment Activities........................ 1.32 1.95 1.35 0.44 0.40
------- ------- ------ ------ ------
Distributions:
Net investment income..................................... -- (0.08) (0.15) (0.07) --
In excess of net investment income........................ -- (0.07) (0.02) -- --
Net realized gains........................................ (0.43) (0.15) (0.12) (0.04) --
------- ------- ------ ------ ------
Total Distributions..................................... (0.43) (0.30) (0.29) (0.11) --
------- ------- ------ ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $ 17.33 $ 16.44 $14.79 $13.73 $13.40
======= ======= ====== ====== ======
Total Return (Excludes Sales Charge)........................ 8.48% 13.37% 9.97% 3.17% 3.23% (b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $13,307 $10,033 $5,856 $3,687 $1,872
Ratio of expenses to average net assets................... 1.88% 1.86% 1.97% 2.04% 2.00%(c)
Ratio of net investment income to average net assets...... 0.26% 0.08% 0.04% 0.25% 1.37% (c)
Ratio of expenses to average net assets*.................. 1.88% 1.86% 2.00% 2.04% 2.00% (c)
Ratio of net investment income to average net assets*..... 0.26% 0.08% 0.01% 0.25% 1.37% (c)
Portfolio turnover (d).................................... 9.90% 9.61% 6.28% 4.67% 7.74%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
148
252
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERNATIONAL
EQUITY
INDEX FUND
--------------
CLASS C
--------------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(a)
--------------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $15.70
------
Investment Activities:
Net investment income (loss).............................. 0.06
Net realized and unrealized gains from investments
(losses)................................................ 2.45
------
Total from Investment Activities........................ 2.51
------
Distributions:
Net realized gains........................................ (0.30)
------
Total Distributions..................................... (0.30)
------
NET ASSET VALUE, END OF PERIOD.............................. $17.91
======
Total Return (Excludes Sales Charge)........................ 16.34%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 119
Ratio of expenses to average net assets................... 1.87%(c)
Ratio of net investment income to average net assets...... 2.88%(c)
Portfolio turnover (d).................................... 9.90%
- ------------
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
149
253
- --------------------------------------------------------------------------------
Report of Independent Accountants
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
To the Shareholders and Board of Trustees of
The One Group Family of Mutual Funds:
In our opinion, the accompanying statements of assets and liabilities, including
the portfolios of investments, and related statements of operations, of changes
in net assets and of cash flows and the financial highlights present fairly, in
all material respects, the financial position of the Asset Allocation Fund, the
Income Equity Fund, the Equity Index Fund, the Value Growth Fund, the Large
Company Value Fund, the Disciplined Value Fund, the Large Company Growth Fund,
the Growth Opportunities Fund, the Small Capitalization Fund and the
International Equity Index Fund (ten series of The One Group Family of Mutual
Funds), at June 30, 1998, the results of each of their operations for the period
then ended, the changes in each of their net assets, and the cash flows of the
Asset Allocation Fund, the Growth Opportunities Fund and the International
Equity Index Fund for the periods presented and the financial highlights for
each of the periods presented, in conformity with generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of The One Group
Family of Mutual Funds' management; our responsibility is to express an opinion
on these financial statements based on our audits. We conducted our audits of
these financial statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at June 30, 1998 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above.
PricewaterhouseCoopers LLP
August 18, 1998
150
254
Important Customer Information.
Please Read:
Shares of The One Group:
* are not deposits or obligations of, or guaranteed by, BANC ONE CORPORATION or
its affiliates
* are not insured or guaranteed by the FDIC or by any other governmental agency
or government-sponsored agency of the federal government or any state
* are subject to investment risks, including possible loss of the principal
amount invested.
Banc One Investment Advisors Corporation, a registered investment advisor and
an indirect subsidiary of BANC ONE CORPORATION, serves as an investment advisor
to The One Group, for which it receives advisory fees. The One Group is
distributed by The One Group Services Company, 3435 Stelzer Road, Columbus,
Ohio 43219, which is not affiliated with BANC ONE CORPORATION and is not a
bank. Contact us at our web site address: www.onegroup.com or e-mail us at
onegroup@onegroup.com.
For more complete information on any of The One Group Funds, including
management fees and expenses, you may obtain a prospectus from The One Group
Services Company. Read the prospectus carefully before investing.
BANC ONE
INVESTMENT
ADVISORS
CORPORATION
[BANC ONE LOGO]
TOG-F-038-AN (8/98)
255
Municipal
Income Funds
Annual Report
For the year ended June 30, 1998
Intermediate Tax-Free Bond Fund
Municipal Income Fund
Kentucky Municipal Bond Fund
Ohio Municipal Bond Fund
Louisiana Municipal Bond Fund
West Virginia Municipal Bond Fund
Arizona Municipal Bond Fund
THE ONE GROUP
----------------------
FAMILY OF MUTUAL FUNDS
256
IMPORTANT CUSTOMER INFORMATION. INVESTMENT PRODUCTS:
- are not deposits or obligations of, or guaranteed by,
BANC ONE CORPORATION or any of its affiliates [FDIC LOGO
WITH SLASH
- are not issued by the FDIC, and THOUGH IT]
- are subject to investment risks, including possible
loss of the principal amount invested.
257
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Table of Contents
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Portfolio Performance Review............................................... 2
Schedules of Portfolio Investments......................................... 22
Statements of Assets and Liabilities....................................... 77
Statements of Operations................................................... 79
Statements of Changes in Net Assets........................................ 81
Notes to Financial Statements.............................................. 84
Financial Highlights....................................................... 94
Report of Independent Accountants........................................... 116
1
258
The One Group Intermediate Tax-Free Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Intermediate Tax-Free Bond Fund Fiduciary share class offered a
total return of 7.74% for the year ended June 30, 1998. (For information on
other share classes and performance comparisons to indexes, please see page 4.)
Overall, interest rates declined during the year, and the Fund's 30-day SEC
yield (Fiduciary share class) fell to 4.15% at year-end, compared to 4.57% on
June 30, 1997. (For investors in the 39.6% federal income tax bracket, the June
30, 1998, yield translates into a taxable-equivalent yield of 6.87%.)
HOW DID YOU MANAGE INTEREST RATE VOLATILITY?
We generated the Fund's total return by continually realigning the portfolio
through one of the most volatile market environments in recent history. With
worries of inflation-induced Federal Reserve intervention and fallout from the
Asian situation, we witnessed significant market moves on a regular basis. With
limited cash flow in the Fund, we sought to add value for shareholders by taking
advantage of this volatility. By investing in discount coupon bonds, we could
buy when the market fell off and let the bonds run up in price when the markets
recovered from the many sell-offs during the year.
With an eye on after-tax total return, we remain conscious of capital gains. As
such, we will take losses on bonds when the market declines, which helps offset
the gains the Fund realizes when the market rallies. Our intent is to generate
tax-free income, but we also want to enhance total return by realigning the
portfolio to react to market conditions.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Our belief during the year was that the market would be volatile, but that
interest rates would head lower. As such, we maintained an average duration near
the six-year mark, added yield to the portfolio, and traded securities to take
advantage of market volatility. (Duration is a measure of a fund's price
sensitivity to interest rate changes. A longer duration indicates greater
sensitivity; a shorter duration indicates less.)
In keeping with our strategy, when rates moved up, and prices fell, we sold
certain issues and captured losses (see above). Then, we replaced those issues
with bonds of similar structure--positive convexity, discount coupons and high
liquidity--which increased the portfolio's yield. (Convexity is a secondary
measure of a fund's price sensitivity to interest rate changes. Generally, bonds
with positive convexity perform better than those with negative convexity in
periods of high interest rate volatility.) Our strategy was to restructure a
portion of the portfolio with blocks of desirable bonds, so as to sell them at a
profit if our outlook changed during the year. Given the volatility in the
market from repeated economic data suggesting the death of inflation, to the
Asian turmoil that sent the markets reeling in the fourth quarter of 1997, our
tactics were sound.
DID THE FUND'S OVERALL QUALITY CHANGE?
The Fund's overall credit quality remained high, largely because an increasing
number of bonds coming to market are insured. At year-end, 73.9% of the Fund's
assets were invested in securities rated AAA and AA. We continue to look in the
lower-investment-grade areas for bonds with higher yields. But, this has been
somewhat challenging because the spread, or difference in yield, between
medium-grade bonds (those rated A and BBB) and AAA-rated bonds has been
compressed over the last 18 months, meaning that there is little yield advantage
to moving into the medium-quality area.
2
259
The One Group Intermediate Tax-Free Bond Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
WHAT IS YOUR OUTLOOK FOR THE FUND?
We have no real evidence that market volatility will subside in the near future,
so we anticipate trading in the range we have seen over the past year. We remain
vigilant in our inflation watch, because any sign of an overheating economy
should lead the Federal Reserve to raise rates and, therefore, erode the value
of bonds. Nevertheless, we expect inflation to remain under control for the near
term, as a slower-growth economy should keep interest rates low and may even
force the Fed to ease monetary policy.
/s/ Patrick M. Morrissey
Patrick M. Morrissey
Fund Manager
/s/ Gary J. Madich, CFA
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
3
260
The One Group Intermediate Tax-Free Bond Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (9/4/90)
Fiduciary 7.74% 5.46% 6.95%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Fiduciary
9/90 $10,000 $10,000 $10,000
6/91 10,814 10,749 10,777
6/92 11,996 11,854 11,805
6/93 13,285 13,026 12,961
6/94 13,453 13,156 12,946
6/95 14,560 14,046 13,820
6/96 15,366 14,764 14,564
6/97 16,446 15,715 15,694
6/98 $17,653 $16,807 $16,908
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 7.50% 5.22% 6.08%
Class A* 2.70% 4.26% 5.32%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class A* Class A
2/92 $10,000 $10,000 $ 9,550 $10,000
6/92 10,319 10,311 9,850 10,314
6/93 11,428 11,331 10,783 11,291
6/94 11,572 11,443 10,747 11,253
6/95 12,525 12,218 11,444 11,983
6/96 13,218 12,842 12,046 12,616
6/97 14,147 13,669 12,933 13,547
6/98 $15,185 $14,619 $13,904 $14,561
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 6.81% 4.28%
Class B** 2.81% 3.89%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/94 9,622 9,601 9,552 9,552
6/95 10,413 10,251 10,115 10,115
6/96 10,990 10,775 10,568 10,568
6/97 11,762 11,469 11,289 11,289
6/98 $12,625 $12,266 $11,856 $12,056
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The fund's income may be subject to the federal alternative minimum tax.
The performance of the Intermediate Tax-Free Bond Fund is measured against the
Lehman Brothers 7 Year Municipal Bond Index, an unmanaged index comprised of
investment grade municipal bonds with maturities close to seven years. Investors
are unable to purchase the index directly, although they can invest in the
underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lipper Intermediate Municipal Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
4
261
The One Group Municipal Income Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Municipal Income Fund Fiduciary share class offered a total return
of 8.09% for the year ended June 30, 1998. (For information on other share
classes and performance comparisons to indexes, please see page 7.)
HOW DID INTEREST RATES INFLUENCE PERFORMANCE?
Overall, interest rates declined during the year, and the Fund's 30-day SEC
yield (Fiduciary share class) fell to 4.76% at year-end, compared to 5.20% on
June 30, 1997. (For investors in the 39.6% federal income tax bracket, the June
30, 1998, yield translates into a taxable-equivalent yield of 7.88%.)
While the low-inflation environment continued to boost the market, it also left
many investors wondering when this favorable climate would end. This, coupled
with fears that the Federal Reserve would increase interest rates, acted as a
catalyst to market volatility, but we were able to use that volatility to the
Fund's advantage. Combining cash flow, which was strong from new money, and
patience to find attractively priced bonds, we were able to capture yield and
enhance the Fund's overall total return.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
The Fund's primary strategy remains the same--seeking to generate a high level
of income while maintaining high overall credit quality and a more stable share
price compared to funds of longer maturity and duration. (Duration is a measure
of a fund's price sensitivity to interest rate changes. A higher duration
indicates greater sensitivity; a shorter duration indicates less.) At 6.0
years, the Fund's duration is slightly longer than it was last year, which
helped the Fund's price performance as rates declined. Nevertheless, duration
has remained between 5.0 years and 6.5 years since the Fund's inception, and we
intend to keep it within this narrow band.
We continued to emphasize municipal housing bonds during the year, as these
bonds exhibit the defensive characteristics that are the cornerstone of the
Fund. They tend to offer a high level of income and relative price stability
compared to other municipal bonds. We also invest in bonds from other market
sectors that exhibit good structure--that is, they offer higher-than-
market-rate coupons and embedded call options or sinking funds, features that
make their payment schedules more predictable.
Over the past year, we also have taken positions in high-quality discount bonds
to take advantage of the declining rate environment, which pushed bond prices
upward. We realized the best results with zero-coupon and 5%-coupon bonds.
Another tactic that worked well for the Fund's performance was purchasing
high-quality, specialty-state discount bonds. Because the supply of these bonds
often is limited, we usually can sell them at a profit when demand increases.
And, if we can sell into an increased demand at a time when rates are lower than
when we bought the bonds (as rates go down, prices go up), we can realize the
best gains. Of course, we use this strategy sparingly, as not to generate an
excess amount of short-term capital gains. The majority of the bonds we purchase
are those we expect to hold for a long time.
5
262
The One Group Municipal Income Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
WHAT IS YOUR OUTLOOK FOR THE FUND?
Looking forward, we will continue to watch for signs that the economy is
overheating. We don't expect this to happen over the near term, though, as
fallout from the Asian crisis should contribute to a slower-growth economy. As a
result, inflation and interest rates should remain low. We plan to stick with
our ongoing strategy of attempting to generate a high level of income while
maintaining a relatively stable share price environment.
/s/ Patrick M. Morrissey
Patrick M. Morrissey
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
6
263
The One Group Municipal Income Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/9/93)
Fiduciary 8.09% 5.76% 5.92%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers Municipal Bond
(Fiscal Year Covered) Housing Bond Funds Index Fiduciary
2/93 $10,000 $10,000 $10,000
6/93 10,530 10,135 10,303
6/94 10,662 10,236 10,444
6/95 11,556 10,928 11,118
6/96 12,423 11,487 11,734
6/97 13,440 12,226 12,613
6/98 $14,601 $13,076 $13,632
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/23/93)
Class A 7.84% 5.57% 5.67%
Class A* 2.94% 4.59% 4.77%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lehman Lipper
Brothers Intermediate
Measurement Period Housing Bond Municipal Bond
(Fiscal Year Covered) Index Funds Index Class A* Class A
2/93 $10,000 $10,000 $ 9,550 $10,000
6/93 10,530 10,135 9,781 10,242
6/94 10,662 10,236 9,912 10,379
6/95 11,556 10,928 10,527 11,023
6/96 12,423 11,487 11,090 11,612
6/97 13,440 12,226 11,892 12,453
6/98 $14,601 $13,076 $12,829 $13,429
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 7.04% 4.85%
Class B** 3.04% 4.47%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers Municipal Bond
(Fiscal Year Covered) Housing Bond Funds Index Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/94 9,670 9,721 9,802 9,802
6/95 10,482 10,251 10,349 10,349
6/96 11,267 10,775 10,830 10,830
6/97 12,191 11,469 11,539 11,539
6/98 $13,244 $12,266 $12,151 $12,351
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 8.28%
Class C** 7.28%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers Municipal Bond
(Fiscal Year Covered) Housing Bond Funds Index Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/98 $10,828 $10,728 $10,476 $10,345
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The fund's income may be subject to the federal alternative minimum tax.
The performance of the Municipal Income Fund is measured against the Lehman
Brothers Housing Bond Index, an unmanaged index comprised of municipal housing
bonds. Investors are unable to purchase the index directly, although they can
invest in the underlying securities. The performance of the index does not
reflect the deduction of expenses associated with a mutual fund, such as
investment management. By contrast, the performance of the fund reflects the
deduction of these value-added services as well as the deduction of sales
charges on Class A Shares and applicable contingent deferred sales charges on
Class B and Class C Shares.
The Lipper Intermediate Municipal Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
7
264
The One Group Kentucky Municipal Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Kentucky Municipal Bond Fund Fiduciary share class posted a total
return of 7.11% for the year ended June 30, 1998. (For information on other
share classes and performance comparisons to indexes, please see page 10.)
Despite strong volatility during the first six months of 1998, interest rates
ended the fiscal year lower. The Fund's 30-day SEC yield (Fiduciary share class)
followed suit, declining to 3.91% on June 30, 1998, compared to 4.34% on June
30, 1997. (For investors in the 39.6% federal income tax bracket and the 6.0%
Kentucky state bracket, the June 30, 1998, yield translates into a 6.89%
tax-equivalent yield.) This decline was slightly less than the 45 basis point
drop incurred by securities in the 10- to 15-year maturity range of the general
market.
HOW DID INCOME AND PRICE APPRECIATION INFLUENCE TOTAL RETURN?
The major contributor to the Fund's strong performance was income, which
accounted for 5.15% of the Fund's total return. Price appreciation accounted for
1.96% of the Fund's one-year return, which essentially matched the interest rate
movement in the general market. The Fund's older, higher-coupon bonds
contributed to the income return, while the non-callable, zero-coupon holdings
provided much of the price appreciation.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Because this is a single-state fund, our investment selections primarily are
limited to bonds issued in Kentucky, and supply can be limited at times.
Therefore, we must consider bonds in all market sectors, focusing on
high-quality, full-coupon (at par or a slight premium price), intermediate-term
(maturing in nine to 15 years) securities with good call structures. (Call
refers to a bond issuer's right to repay, or "call" the bond prior to its
maturity date.) Bonds with these characteristics should provide a higher level
of income and better price protection if interest rates begin to rise. These
bonds also should experience some positive price performance if rates decline
modestly.
We also maintained our "buy and hold" strategy, which has been successful over
the years. For example, it was the older, higher-coupon bonds purchased in prior
years that strengthened the Fund's income return during fiscal 1998.
Finally, we attempted to remain nearly fully invested during the year, which
helped enhance the Fund's income stream and maintain the Fund's duration.
(Duration is a measure of a fund's price sensitivity to interest rate changes. A
longer duration indicates greater price movement; a shorter duration indicates
less.) The Fund's duration remained fairly constant at 5.2 years, which helped
enhance the Fund's yield and kept the Fund's price performance from lagging that
of the general market.
DID THE FUND'S AVERAGE QUALITY CHANGE?
The Fund's average quality remained high during the year, with approximately 70%
of the portfolio rated AA or better, slightly above that of a year ago.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We expect the current market volatility to continue over the coming months, as
the struggle between domestic growth and concerns over several important foreign
economies will continue to play out. This volatility likely will be accompanied
by a modest downward trend in interest rates over the near term. There are fears
that inflation may heat up, but evidence of this actually happening has not
surfaced.
8
265
The One Group Kentucky Municipal Bond Fund
Portfolio Performance Review, continued
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THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Given this outlook, we expect to maintain our current Fund strategies. We will
continue to focus on keeping the income stream as high as possible, because
overall price performance should be muted with rates as low as they are.
/s/ David M. Sivinski
David M. Sivinski, CFA
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
9
266
The One Group Kentucky Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (3/12/93)
Fiduciary 7.11% 5.40% 5.52%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Fiduciary
3/93 $10,000 $10,000 $10,000
6/93 10,277 10,252 10,221
6/94 10,407 10,354 10,250
6/95 11,263 11,054 10,935
6/96 11,887 11,620 11,630
6/97 12,722 12,367 12,414
6/98 $13,656 $13,227 $13,297
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (3/12/93)
Class A 6.86% 5.17% 5.30%
Class A* 2.06% 4.20% 4.39%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class A* Class A
3/93 $10,000 $10,000 $ 9,550 $10,000
6/93 10,277 10,252 9,761 10,221
6/94 10,407 10,354 9,789 10,250
6/95 11,263 11,054 10,444 10,935
6/96 11,887 11,620 11,039 11,559
6/97 12,722 12,367 11,752 12,305
6/98 $13,656 $13,227 $12,560 $13,151
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (3/16/95)
Class B 6.20% 6.04%
Class B** 2.20% 5.23%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class B** Class B
3/95 $10,000 $10,000 $10,000 $10,000
6/95 10,284 10,226 10,263 10,263
6/96 10,853 10,749 10,792 10,792
6/97 11,616 11,440 11,419 11,419
6/98 $12,469 $12,235 $11,827 $12,127
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The fund's income may be subject to the federal alternative minimum tax.
The above-quoted performance data includes the performance of the Trademark
Kentucky Municipal Bond Fund for the period prior to the commencement of
operations of The One Group Kentucky Municipal Bond Fund on January 20, 1995.
Performance for Class A Shares is based on Fiduciary Share performance adjusted
to reflect the sales charges applicable to Class A Shares.
The performance of the Kentucky Municipal Bond Fund is measured against the
Lehman Brothers 7 Year Municipal Bond Index, an unmanaged index comprised of
investment grade municipal bonds with maturities close to seven years. Investors
are unable to purchase the index directly, although they can invest in the
underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lipper Intermediate Municipal Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
10
267
The One Group Ohio Municipal Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Ohio Municipal Bond Fund Fiduciary share class posted a total
return of 7.13% for the year ended June 30, 1998. (For information on other
share classes and performance comparisons to indexes, please see page 13.)
There was strong volatility during the first six months of 1998, and interest
rates ended the fiscal year modestly lower. The 30-day SEC yield on the Fund's
Fiduciary share class followed suit, declining to 4.19% on June 30, 1998,
compared to 4.31% on June 30, 1997. (For investors in the 39.6% federal income
tax bracket and the 7.2% Ohio state bracket, the June 30, 1998, yield translates
into a 7.47% tax-equivalent yield.)
HOW DID INCOME AND PRICE APPRECIATION INFLUENCE TOTAL RETURN?
Price appreciation accounted for 1.84% of the Fund's one-year return, a figure
that essentially matched the interest rate movement in the general market. But,
the major contributor to the Fund's strong performance was income, which
accounted for 5.29% of the Fund's total return. The Fund's older, higher-coupon
bonds contributed to the income return, while the non-callable, zero-coupon
holdings accounted for much of the price appreciation.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Because this is a single-state fund, our investment selections primarily are
limited to bonds issued in Ohio. As such, we must consider bonds in all market
sectors, focusing on high-quality, full-coupon (at par or a slight premium
price), intermediate-term (maturing in nine to 15 years) securities with good
call structures. (Call refers to a bond issuer's right to repay, or "call," the
bond prior to its maturity date.) Bonds with these characteristics should
provide a higher level of income and better price protection if interest rates
begin to rise. These bonds also should experience some positive price
performance if rates decline modestly.
We also maintained our "buy and hold" strategy, which proved successful during
the year, as it was the older, higher-coupon bonds purchased in prior years that
strengthened the Fund's income return.
Furthermore, we slightly lengthened the Fund's duration to 5.7 years, from 5.1
years on June 30, 1997. This helped enhance the Fund's yield and kept the Fund's
price performance from lagging that of the general market. (Duration is a
measure of a fund's price sensitivity to interest rate changes. A longer
duration indicates greater price movement; a shorter duration indicates less.)
Finally, we attempted to remain nearly fully invested during the year, which
helped enhance the Fund's income stream and extend the Fund's duration.
Throughout the year, the portfolio's cash position generally was less than $1
million.
DID THE FUND'S MATURITY STRUCTURE CHANGE?
Despite the move in duration, the Fund's average maturity decreased slightly
during the year--from 10.5 years on June 30, 1997, to 10.3 years on June 30,
1998. This was due to our purchase of intermediate non-callable bonds, which
helped lengthen duration without extending maturity.
WHAT ABOUT QUALITY?
The Fund's average quality remained very high during the year, with 68% of the
portfolio rated AAA (the highest rating), approximately the same as a year ago.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We expect the current market volatility to continue over the coming months, as
the struggle between domestic growth and concerns over several important foreign
economies will continue to play out. This volatility likely will be accompanied
by a modest downward trend in interest rates over the near term. There are fears
that inflation may heat up, but evidence of this actually happening has not
surfaced.
11
268
The One Group Ohio Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Given this outlook, we expect to maintain our current Fund strategies. We will
continue to focus on keeping the income stream as high as possible, because
overall price performance should be muted with rates as low as they are.
/s/ David M. Sivinski
David M. Sivinski, CFA
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
12
269
The One Group Ohio Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (7/2/91)
Fiduciary 7.13% 5.20% 6.84%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Fiduciary
6/98 $ 16,162 $15,472 $15,883
6/97 15,057 14,467 14,825
6/96 14,069 13,592 13,827
6/95 13,330 12,931 13,083
6/94 12,317 12,112 12,334
6/93 12,163 12,192 12,325
6/92 10,983 10,913 11,061
7/91 $ 10,000 $10,000 $10,000
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 6.87% 4.97% 6.30%
Class A* 2.10% 4.01% 5.53%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class A* Class A
2/92 $10,000 $10,000 $ 9,550 $10,000
6/92 10319 10,311 9,925 10,393
6/93 11428 11,331 11,056 11,577
6/94 11572 11,443 11,051 11,572
6/95 12525 12,218 11,691 12,242
6/96 13218 12,842 12,327 12,908
6/97 14,147 13,669 13,183 13,805
6/98 $15,185 $14,619 $14,082 $14,753
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 6.20% 4.05%
Class B** 2.20% 3.66%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class B** Class B
1/94 $10000 $10,000 $10,000 $10,000
6/94 9622 9,601 9,598 9,598
6/95 10413 10,251 10,095 10,095
6/96 10990 10,775 10,578 10,578
6/97 11762 11,469 11,241 11,241
6/98 $12625 $12,266 $11,739 $11,937
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The fund's income may be subject to the federal alternative minimum tax.
The performance of the Ohio Municipal Bond Fund is measured against the Lehman
Brothers 7 Year Municipal Bond Index, an unmanaged index comprised of investment
grade municipal bonds with maturities close to seven years. Investors are unable
to purchase the index directly, although they can invest in the underlying
securities. The performance of the index does not reflect the deduction of
expenses associated with a mutual fund, such as investment management. By
contrast, the performance of the fund reflects the deduction of these
value-added services as well as the deduction of sales charges on Class A Shares
and applicable contingent deferred sales charges on Class B Shares.
The Lipper Intermediate Municipal Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
13
270
The One Group Louisiana Municipal Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Louisiana Municipal Bond Fund Fiduciary share class posted a total
return of 6.62% for the year ended June 30, 1998. (For information on other
share classes and performance comparisons to indexes, please see page 16.)
There was strong volatility during the first six months of 1998, and interest
rates ended the fiscal year modestly lower. The 30-day SEC yield on the Fund's
Fiduciary share class followed suit, declining to 3.90% on June 30, 1998,
compared to 4.16% on June 30, 1997. (For investors in the 39.6% federal income
tax bracket and the 6.0% Louisiana state bracket, the June 30, 1998, yield
translates into a 6.88% tax-equivalent yield.)
HOW DID INCOME AND PRICE APPRECIATION INFLUENCE TOTAL RETURN?
Price appreciation accounted for 1.58% of the Fund's one-year return, which
essentially matched the interest rate movement in the general market. But, the
major contributor to the Fund's strong performance was income, which accounted
for 5.04% of the Fund's total return. The Fund's older, higher-coupon bonds
contributed to the income return, while the non-callable, zero-coupon holdings
accounted for much of the price appreciation.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS
The supply of bonds available in Louisiana can be limited. Because of this, we
can't favor or exclude particular market sectors. We must consider bonds in all
market sectors, focusing on high-quality, full-coupon (at par or a slight
premium price), intermediate-term (maturing in nine to 15 years) securities with
good call structures. (Call refers to a bond issuer's right to repay, or "call,"
the bond prior to its maturity date.) Bonds with these characteristics should
provide a higher level of income and better price protection if interest rates
begin to rise. These bonds also should experience some positive price
performance if rates decline modestly.
We also maintained our "buy and hold" strategy, which proved successful during
the year, as it was the older, higher-coupon bonds purchased in prior years that
strengthened the Fund's income return.
Furthermore, we slightly lengthened the Fund's duration to 5.4 years, from 5.1
years on June 30, 1997. This helped enhance the Fund's yield and kept the Fund's
price performance from lagging that of the general market. (Duration is a
measure of a fund's price sensitivity to interest rate changes. A longer
duration indicates greater price movement; a shorter duration indicates less.)
Finally, we attempted to remain nearly fully invested during the year, which
helped enhance the Fund's income stream and extend the Fund's duration.
Throughout the year, the portfolio's cash position generally was less than $1
million.
DID THE FUND'S QUALITY CHANGE DURING THE YEAR?
The Fund's average quality remained high during the year, with 79% of the
portfolio rated AA or better, approximately the same as that of a year ago. This
good credit quality rating primarily was due to the fact that most of the Fund's
bonds were escrowed or insured.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We expect the current market volatility to continue over the coming months, as
the struggle between domestic growth and concerns over several important foreign
economies will continue to play out. This volatility likely will be accompanied
by a modest downward trend in interest rates over the near term. There are fears
that inflation may heat up, but evidence of this actually happening has not
surfaced.
14
271
The One Group Louisiana Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Given this outlook, we expect to maintain our current Fund strategies. We will
continue to focus on keeping the income stream as high as possible, because
overall price performance should be muted with rates as low as they are.
/s/ David M. Sivinski
David M. Sivinski, CFA
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
15
272
The One Group Louisiana Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (12/29/89)
Fiduciary 6.62% 5.26% 6.81%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Fiduciary
6/98 $18,262 $17,353 $17,509
6/97 17,013 16,225 16,422
6/96 15,896 15,244 15,375
6/95 15,062 14,503 14,584
6/94 13,917 13,584 13,685
6/93 13,743 13,450 13,550
6/92 12,410 12,239 12,295
6/91 11,187 11,098 11,182
6/90 10,274 10,248 10,339
12/89 $10,000 $10,000 $10,000
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (12/29/89)
Class A 6.35% 5.14% 6.74%
Class A* 1.53% 4.18% 6.17%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class A* Class A
12/89 $10,000 $10,000 $ 9,550 $10,000
6/90 10,274 10,248 9,873 10,339
6/91 11,187 11,098 10,679 11,182
6/92 12,410 12,239 11,742 12,295
6/93 13,743 13,450 12,940 13,550
6/94 13,917 13,584 13,069 13,685
6/95 15,062 14,503 13,928 14,584
6/96 15,896 15,244 14,673 15,365
6/97 17,013 16,225 15,634 16,371
6/98 $18,262 $17,353 $16,629 $17,410
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (9/16/94)
Class B 5.69% 5.57%
Class B** 1.69% 4.88%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class B** Class B
9/94 $10,000 $10,000 $10,000 $10,000
6/95 10,824 10,735 10,482 10,482
6/96 11,424 11,283 10,970 10,970
6/97 12,226 12,010 11,614 11,614
6/98 $13,123 $12,845 $11,976 $12,276
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The fund's income may be subject to the federal alternative minimum tax.
The above-quoted performance data includes the performance of the Paragon
Louisiana Tax-Free Fund for the period prior to the commencement of operations
of The One Group Louisiana Municipal Bond Fund on March 26, 1996. Performance
for the Fiduciary Shares is based on Class A Share performance adjusted to
reflect the absence of sales charges.
The performance of the Louisiana Municipal Bond Fund is measured against the
Lehman Brothers 7 Year Municipal Bond Index, an unmanaged index comprised of
investment grade municipal bonds with maturities close to seven years. Investors
are unable to purchase the index directly, although they can invest in the
underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lipper Intermediate Municipal Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
16
273
The One Group West Virginia Municipal Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
PERFORMANCE
The One Group West Virginia Municipal Bond Fund Fiduciary share class posted a
total return of 7.36% for the year ended June 30, 1998. (For information on
other share classes and performance comparisons to indexes, please see page 19.)
There was strong volatility during the first six months of 1998, and interest
rates ended the fiscal year modestly lower. The 30-day SEC yield on the Fund's
Fiduciary share class also fell, declining to 4.13% on June 30, 1998, compared
to 4.33% on June 30, 1997. (For investors in the 39.6% federal income tax
bracket and the 6.5% West Virginia state bracket, the June 30, 1998, yield
translates into a 7.31% tax-equivalent yield.)
HOW DID INCOME AND PRICE APPRECIATION INFLUENCE TOTAL RETURN?
The major contributor to the Fund's strong performance was income, which
accounted for 5.17% of the Fund's total return. Price appreciation accounted for
2.19% of the Fund's one-year return, a figure that slightly exceeded the
interest rate movement in the general market. The Fund's older, higher-coupon
bonds contributed to the income return, while the non-callable, zero-coupon
holdings accounted for much of the price appreciation.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Because this is a single-state fund, our investment selections primarily are
limited to bonds issued in West Virginia. And, because the supply of such bonds
is limited, we must consider alternatives in all market sectors. To help us
uncover the best candidates for investment, we focus on high-quality,
full-coupon (at par or a slight premium price), intermediate-term (maturing in
nine to 15 years) securities with good call structures. (Call refers to a bond
issuer's right to repay, or "call," the bond prior to its maturity date.) Bonds
with these characteristics should provide a higher level of income and better
price protection if interest rates begin to rise. These bonds also should
experience some positive price performance if rates decline modestly.
We also maintained our "buy and hold" strategy, which proved successful during
the year. It was the older, higher-coupon bonds purchased in prior years that
strengthened the Fund's income return.
Furthermore, we lengthened the Fund's duration to 5.9 years, from 5.0 years on
June 30, 1997. This helped enhance the Fund's yield and kept the Fund's price
performance from lagging that of the general market. (Duration is a measure of a
fund's price sensitivity to interest rate changes. A longer duration indicates
greater price movement; a shorter duration indicates less.)
Finally, we attempted to remain nearly fully invested during the year, which
helped enhance the Fund's income stream and extend the Fund's duration.
Throughout the year, the portfolio's cash position generally was less than $1
million.
DID THE FUND'S MATURITY CHANGE DURING THE YEAR?
Along with the duration, the Fund's average maturity increased during the
year--from 9.4 years on June 30, 1997, to 10.6 years on June 30, 1998.
WHAT ABOUT QUALITY?
The Fund's average quality remained high during the year, with 82% of the
portfolio rated AA or better, above the 76% level one year ago.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We expect the current market volatility to continue over the coming months, as
the struggle between domestic growth and concerns over several important foreign
economies will continue to play out. This volatility likely will be accompanied
by a modest downward trend in interest rates over the near term. There are fears
that inflation may heat up, but evidence of this actually happening has not
surfaced.
17
274
The One Group West Virginia Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Given this outlook, we expect to maintain our current Fund strategies. We will
continue to focus on keeping the income stream as high as possible, because
overall price performance should be muted with rates as low as they are.
/s/ David M. Sivinski
David M. Sivinski, CFA
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
18
275
The One Group West Virginia Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (12/31/83)
Fiduciary 7.36% 5.62% 6.69% 7.39%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Fiduciary
6/98 $17,468 $19,444 $19,103
6/97 16,274 18,180 17,792
6/96 15,560 17,080 16,574
6/95 15,077 16,250 15,847
6/94 14,200 15,220 15,000
6/93 14,218 15,070 14,532
6/92 13,386 13,714 13,442
6/91 12,449 1,2435 12,370
6/90 11,761 11,482 11,505
6/89 11,139 10,813 10,761
6/88 $10,000 $10,000 $10,000
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (12/31/83)
Class A 6.98% 5.42% 6.45% 7.15%
Class A* 2.16% 4.45% 5.96% 6.82%
* Reflects 4.50% Sales Charge.
VALUE OF $0,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class A* Class A
6/88 $10,000 $10,000 $ 9,550 $10,000
6/89 11,139 10,813 10,246 10,728
6/90 11,761 11,482 10,942 11,457
6/91 12,449 12,435 11,735 12,288
6/92 13,386 13,714 12,722 13,322
6/93 14,218 15,070 13,709 14,355
6/94 14,200 15,220 14,114 14,779
6/95 15,077 16,250 14,875 15,576
6/96 15,560 17,080 15,522 16,254
6/97 16,274 18,180 16,684 17,470
6/98 $17,468 $19,444 $17,850 $18,691
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Inception
1 Year 5 Year 10 Year (12/31/83)
Class B 6.57% 4.76% 5.79% 6.47%
Class B** 2.57% 4.59% 5.79% 6.47%
** Reflects Applicable Contingent Deferred Sales Charge
VALUE OF $10,000 INVESTMENT
Lipper
Intermediate
Measurement Period BrYear Municipal Bond
(Fiscal Year Covered) MBond Funds Index Class B** Class B
6/88 $10,000 $10,000 $10,000 $10,000
6/89 11,139 10,813 10,674 10,674
6/90 11,761 11,482 11,316 11,316
6/91 12,449 12,435 12,070 12,070
6/92 13,386 13,714 13,001 13,001
6/93 14,218 15,070 13,916 13,916
6/94 14,200 15,220 14,237 14,237
6/95 15,077 16,250 14,895 14,895
6/96 15,560 17,080 15,457 15,457
6/97 16,274 18,180 16,475 16,475
6/98 $17,468 $19,444 $17,557 $17,557
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The fund's income may be subject to the federal alternative minimum tax.
The above-quoted performance data includes the performance of the West Virginia
Municipal Bond Collective Trust Fund for the period prior to the commencement of
operations of The West Virginia Municipal Bond Fund on January 20, 1997,
adjusted to reflect the deduction of fees and expenses (absent any waivers)
applicable to the Fiduciary, Class A and Class B shares of the West Virginia
Municipal Bond Fund. The West Virginia Municipal Bond Collective Trust Fund was
not registered under the Investment Company Act of 1940 ("1940 Act") and,
therefore, was not subject to certain investment restrictions, limitations and
diversification requirements imposed by the 1940 Act and the Internal Revenue
Code. If the West Virginia Municipal Bond Collective Trust Fund had been
registered under the 1940 Act, its performance may have been adversely affected.
The performance of the West Virginia Municipal Bond Fund is measured against the
Lehman Brothers 7 Year Municipal Bond Index, an unmanaged index comprised of
investment grade municipal bonds with maturities close to seven years. Investors
are unable to purchase the index directly, although they can invest in the
underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lehman Brothers 7 Year Municipal Bond Index for all classes consists of the
average monthly returns of the Lehman Brothers Municipal Bond Index from June
1988 through December 1989. Thereafter, the data are from the Lehman Brothers 7
Year Municipal Bond Index which corresponds with the initiation of the Index on
January 1, 1990.
The Lipper Intermediate Municipal Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
19
276
The One Group Arizona Municipal Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Arizona Municipal Bond Fund Fiduciary share class offered a total
return of 6.58% for the year ended June 30, 1998. (For information on other
share classes and performance comparisons to indexes, please see page 21.)
The municipal market continued to take a back seat to the equity and taxable
bond markets during the past 12 months. Nevertheless, municipal securities
showed marginal improvement during the year, as yields declined due to the
favorable inflation and monetary policy scenarios. As a result, prices on
municipal bonds generally increased, and the Fund's net asset value (NAV)
increased by 0.89%.
The Fund's Fiduciary share class 30-day SEC yield declined from 4.36% on June
30, 1997, to 3.82% on June 30, 1998. (For investors in the 39.6% federal income
tax bracket and the 5.2% Arizona state bracket, the June 30 yield translates
into a 6.67% tax-equivalent yield.)
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
In a declining interest rate environment, the call date on portfolio securities
takes on added importance. (The call date refers to the first date on which the
bond issuer can redeem outstanding bonds before the maturity date.) When rates
are falling, bond issuers want to "call" their bonds in order to refinance their
debt at lower interest rates. As such, shorter call dates can inhibit a
security's price improvement when interest rates are declining.
Because of this, we took steps to improve the Fund's call protection. We
increased the Fund's average life from 7.0 years to 7.8 years, and we extended
the Fund's duration from 5.4 years to 6.0 years. (Average life refers to the
average period for which the individual bonds held in a fund mature or repay
their face amounts. Duration is a measure of a fund's sensitivity to interest
rate changes. A longer duration indicates greater sensitivity; a shorter
duration indicates less.) We accomplished this by selling short-maturity, high-
coupon bonds and using the proceeds to purchase 12-to 15-year maturities at
small discounts and with better call protection. Having a slightly longer
duration allowed the Fund to capture additional price appreciation in the
declining rate environment. In addition, we added higher yielding
mortgage-backed and hospital-related bonds to maintain the Fund's income flow.
DID THE FUND'S QUALITY CHANGE DURING THE YEAR?
The Fund's overall quality remained unchanged during the year, with nearly 50%
of the securities insured and approximately 90% rated AA or better.
WHAT IS YOUR OUTLOOK FOR THE FUND?
While we expect the general trend of lower interest rates to continue, we do not
anticipate making substantial changes to the portfolio. We will continue to
maintain a portfolio of quality issues with a maturity structure that seeks to
reduce credit risk and price fluctuations.
We expect the U.S. economy to continue growing, but at a slower pace. This
should alleviate the threat of tighter monetary policy from the Federal Reserve.
As such, we see a continuation of the pattern established two years ago--modest
price appreciation on the Fund's NAV, with the substantial portion of return
coming from income.
/s/ Todd Curtis
Todd Curtis, CFA
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
20
277
The One Group Arizona Municipal Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (11/30/79)
Fiduciary 6.58% 5.28% 7.01% 7.34%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Fiduciary
6/98 $17,468 $19,444 $19,688
6/97 16,274 18,180 18,473
6/96 15,560 17,080 17,217
6/95 15,077 16,250 16,552
6/94 14,200 15,220 15,475
6/93 14,218 15,070 15,224
6/92 13,386 13,714 13,877
6/91 12,449 12,435 12,531
6/90 11,761 11,482 11,597
6/89 11,139 10,813 10,951
6/88 $10,000 $10,000 $10,000
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (11/30/79)
Class A 6.30% 4.72% 6.60% 6.99%
Class A* 1.52% 3.76% 6.10% 6.73%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class A* Class A
6/88 $10,000 $10,000 $ 9,550 $10,000
6/89 11,139 10,813 10,439 10,931
6/90 11,761 11,482 11,010 11,529
6/91 12,449 12,435 11,882 12,442
6/92 13,386 13,714 13,124 13,743
6/93 14,218 15,070 14,366 15,043
6/94 14,200 15,220 14,551 15,237
6/95 15,077 16,250 15,525 16,256
6/96 15,560 17,080 16,129 16,889
6/97 16,274 18,180 17,018 17,819
6/98 $17,468 $19,444 $18,089 $18,941
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (11/30/79)
Class B 2.67% 3.41% 5.60% 6.13%
Class B** -1.33% 3.24% 5.60% 6.13%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Measurement Period Brothers 7 Year Municipal Bond
(Fiscal Year Covered) Municipal Bond Funds Index Class B** Class B
6/88 $10,000 $10,000 $10,000 $10,000
6/89 11,139 10,813 10,865 10,865
6/90 11,761 11,482 11,381 11,381
6/91 12,449 12,435 12,212 12,212
6/92 13,386 13,714 13,410 13,410
6/93 14,218 15,070 14,575 14,575
6/94 14,200 15,220 14,675 14,675
6/95 15,077 16,250 15,557 15,557
6/96 15,560 17,080 16,039 16,039
6/97 16,274 18,180 16,788 16,788
6/98 $17,468 $19,444 $17,237 $17,237
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The fund's income may be subject to the federal alternative minimum tax.
The above-quoted performance data includes the performance of the Arizona
Municipal Bond Collective Trust Fund for the period prior to the commencement of
operations of the Arizona Municipal Bond Fund on January 20, 1997, adjusted to
reflect the deduction of fees and expenses (absent any waivers) applicable to
the Fiduciary, Class A and Class B shares of the Arizona Municipal Bond Fund.
The Arizona Municipal Bond Collective Trust Fund was not registered under the
Investment Company Act of 1940 ("1940 Act") and, therefore, was not subject to
certain investment restrictions, limitations and diversification requirements
imposed by the 1940 Act and the Internal Revenue Code. If the Arizona Municipal
Bond Collective Trust Fund had been registered under the 1940 Act, its
performance may have been adversely affected.
The performance of the Arizona Municipal Bond Fund is measured against the
Lehman Brothers 7 Year Municipal Bond Index, an unmanaged index comprised of
investment grade municipal bonds with maturities close to seven years. Investors
are unable to purchase the index directly, although they can invest in the
underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lehman Brothers 7 Year Municipal Bond Index for all classes consists of the
average monthly returns of the Lehman Brothers Municipal Bond Index from June
1988 through December 1989. Thereafter, the data are from the Lehman Brothers 7
Year Municipal Bond Index which corresponds with the initiation of the Index on
January 1, 1990.
The Lipper Intermediate Municipal Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
21
278
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The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS (97.9%):
Alaska (0.2%):
$ 1,000 Anchorage, GO, 6.00%, 10/1/10,
FGIC............................... $ 1,130
--------
Arizona (2.5%):
1,000 Educational Loan Marketing Corp.,
AMT, 7.30%, 9/1/03, Callable 9/1/99
@ 102, MBIA........................ 1,053
1,000 Educational Loan Marketing Corp.,
AMT, 7.35%, 9/1/04, Callable 9/1/99
@ 102, MBIA........................ 1,054
775 Educational Loan Marketing Corp.,
AMT, 7.38%, 9/1/05, Callable 9/1/99
@ 102, MBIA........................ 817
1,385 Maricopa City Industrial Development
Revenue, Coral Apartments Project
Bg, AMT, 5.10%, 3/1/28, Callable
3/1/06 @ 101....................... 1,379
1,105 Maricopa County Development
Authority, Multi-Family Housing,
5.65%, 1/1/09, Callable 1/1/07
@ 101.............................. 1,136
1,280 Maricopa County Development
Authority, Multi-Family Housing,
6.05%, 7/1/17, Callable 1/1/07
@ 101.............................. 1,325
2,835 Phoenix Airport Revenue, AMT, Series
D, 6.00%, 7/1/06, MBIA............. 3,101
700 Phoenix Industrial Development
Authority, 6.00%, 12/1/10, Callable
12/1/03 @ 102...................... 738
2,060 Pima County, Industrial Development
Authority, 5.45%, 4/1/10, Callable
4/1/07 @ 102, MBIA................. 2,188
--------
12,791
--------
Arkansas (0.6%):
1,000 Jefferson County, Pollution Control
Revenue, 5.60%, 10/1/17, Callable
12/1/02 @ 102...................... 1,012
1,060 Sebastian County, Community Junior
College, 5.35%, 4/1/10, Callable
4/1/07 @ 101, AMBAC................ 1,117
1,000 State Capital Appreciation, Series
97A, 0.00%, 6/1/14................. 447
300 State Development Authority, Single
Family Mortgage Revenue, Series G,
5.50%, 1/1/10...................... 310
--------
2,886
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
California (5.8%):
$ 2,000 ABAG Finance Authority for Nonprofit
Corp., 5.75%, 10/1/17, Callable
10/1/07 @ 102...................... $ 2,067
2,000 ABAG Finance Authority for Nonprofit
Corp., Multi-Family Housing
Revenue, AMT, 5.70%, 11/1/26,
Callable 11/1/06 @ 100............. 2,114
1,945 ABAG Finance Authority, Multi-Family
Housing Revenue, AMT, 6.75%,
4/20/07, GNMA...................... 2,135
500 Castaic Lake Water Agency,
Certificates Partnership, Water
System Improvement Project, 7.00%,
8/1/04, Callable 8/1/00 @ 102,
MBIA............................... 541
3,500 Long Beach Harbor, Series A, AMT,
6.00%, 5/15/12, FGIC............... 3,922
1,750 Riverside County, 5.75%, 6/1/09...... 1,939
3,000 Sacramento Municipal Utility
District, 5.40%, 11/15/06, Callable
11/15/03 @ 102, FSA................ 3,192
1,000 San Francisco City & County Airports,
Common International Airport
Revenue, 6.30%, 5/1/11, Callable
5/1/02 @ 102, AMBAC................ 1,084
1,000 Southern Public Power Authority,
Transmission Project, Revenue,
0.00%, 7/1/15, MBIA................ 424
1,000 State, 7.00%, 10/1/07, GO............ 1,194
1,400 Statewide Community Development,
2.40%, 1/1/09, Callable 1/1/04 @
102, AMBAC......................... 1,389
1,270 Statewide Community Development
Authority, Multi-Family Revenue,
Cudahy Gardens Project, Series I,
AMT, 5.10%, 10/1/12, Callable
4/1/03 @ 102, LOC: Swiss Bank...... 1,275
2,100 Statewide Community Development
Authority, Multi-Family Revenue,
Riverside Gardens Project, Series
J, AMT, 5.10%, 10/1/12, Callable
4/1/03 @ 102, LOC: Swiss Bank...... 2,108
4,390 Statewide Community Development
Authority, SeriesA-2, Revenue,
4.90%, 5/15/25, GO................. 4,418
2,000 Statewide Community Development
Authority, Series A-3, Revenue,
5.10%, 5/15/25, Callable 7/1/08 @
101, GO............................ 2,015
--------
29,817
--------
Continued
22
279
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Colorado (9.1%):
$ 3,290 Arapahoe County, Capital
Improvements, Project E-470, 0.00%,
8/31/03............................ $ 2,638
1,135 Arapahoe County, School District #001
Englewood, 0.00%, 11/1/09.......... 677
885 Denver City & County, Airport
Revenue, AMT, 6.75%, 11/15/03,
Callable 11/15/02 @ 102, MBIA...... 971
2,000 Denver City & County, Airport
Revenue, Series B, AMT, 5.75%,
11/15/09, Callable 11/15/06 @ 102,
MBIA............................... 2,166
9,750 Denver City & County, School District
#1, GO, 0.00%, 12/1/06............. 6,693
1,000 Denver City & County, School
District, #001, GO Refunding,
6.50%,
12/1/10............................ 1,182
3,000 El Paso County, School District,
7.13%, 12/1/19, Callable 12/1/07 @
125................................ 3,844
1,135 Health Facilities Authority Revenue,
6.40%, 1/1/10, Callable 1/1/07
@ 101.............................. 1,193
4,255 Highlands Ranch Metro District #004,
GO, 5.25%, 12/1/15, Callable
12/1/08 @ 101, AMBAC............... 4,322
1,320 Housing Finance Authority Single
Family Program, Series C-2,
Revenue, 5.15%, 11/1/16, Callable
5/1/08 @ 102....................... 1,320
240 Housing Finance Authority, AMT,
5.63%, 5/1/04...................... 250
3,220 Housing Finance Authority, GO, Series
A, 6.40%, 8/1/06, Callable 8/1/02 @
102, MBIA.......................... 3,418
4,000 Housing Finance Authority,
Multi-Family Program, 5.65%,
10/1/15............................ 4,103
565 Housing Finance Authority, Refunding,
Single Family, Series D, 5.65%,
12/1/04, Callable 5/1/03 @ 100..... 585
3,250 Housing Finance Authority, Series 97
B-3, 6.80%, 11/1/28, Callable
5/1/07 @ 105....................... 3,647
505 Housing Finance Authority, Single
Family Program, Series F, AMT,
6.75%, 12/1/04..................... 526
500 Jefferson County, Partnership, 6.45%,
12/1/04, Callable 12/1/02 @ 102,
MBIA............................... 554
4,000 Meridian Metropolitan District,
7.50%, 12/1/11, Callable 12/1/01 @
101................................ 4,365
325 Mountain Village Metropolitan
District, San Miguel County, 8.10%,
12/1/11, Callable 12/1/02 @ 101.... 372
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Colorado, continued:
$ 675 Mountain Village Metropolitan
District, San Miguel County, 8.10%,
12/1/11, Prerefunded 12/1/02 @
101................................ $ 787
980 Pueblo County, Single Family Mortgage
Revenue, 6.40%, 11/1/13, Callable
11/1/04 @ 102...................... 1,026
1,250 Summit County, School District #1,
Refunding, 6.75%, 12/1/04, FGIC.... 1,422
--------
46,061
--------
Connecticut (1.6%):
1,000 Bridgeport, Refunding, 6.50%, 9/1/08,
AMBAC.............................. 1,167
1,015 State Health & Educational
Facilities, Series 97E, 5.50%,
7/1/09, Callable 7/1/07 @ 102...... 1,074
1,695 State Housing Finance Authority,
6.70%, 11/15/12, Callable 11/15/02
@ 102.............................. 1,833
1,575 State, GO, Series A, 5.30%, 5/15/10,
Callable 5/15/06 @ 101............. 1,655
2,475 State, GO, Series B, 6.00%,
10/1/05............................ 2,737
--------
8,466
--------
Florida (7.1%):
1,220 Broward County, Housing Authority,
5.55%, 7/1/09, Callable 7/1/06
@ 102.............................. 1,269
1,500 Cape Coral, Special Obligation
Revenue, Water Improvements,
Special Assessment--Water Utility,
6.38%, 6/1/09, Callable 6/1/02 @
102, FSA........................... 1,645
1,270 Clay County, Housing Finance
Authority Revenue, Single Family
Mortgage, AMT, 6.20%, 9/1/11,
Callable 3/1/05 @ 102.............. 1,342
990 Clay County, Housing Finance
Authority Revenue, Single Family
Mortgage, AMT, 6.25%, 9/1/13,
Callable 3/1/05 @ 102.............. 1,047
1,750 Clay County, Housing Financial
Authority, AMT, 5.25%, 10/1/07,
Callable 4/1/07 @ 102.............. 1,806
1,000 Dade County, Aviation Revenue, Series
A, 6.00%, 10/1/08, Callable 10/1/05
@ 102, AMBAC....................... 1,112
1,155 Department of Corrections, Okeechobee
Correctional Facilities, 6.00%,
3/1/06, Callable 3/1/05 @ 102,
AMBAC.............................. 1,279
2,000 Escambia County, Housing Finance
Authority, Multi-Family Housing
Revenue, 5.75%, 4/1/04, Callable
12/30/03 @ 100, GNMA............... 2,053
Continued
23
280
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Florida, continued:
$ 3,635 Hialeah Housing Authority Revenue,
5.80%, 6/20/33, Callable 6/20/08 @
105, GNMA.......................... $ 3,819
1,185 Indian River County, Hospital
Revenue, 5.95%, 10/1/09, Callable
1/1/07 @ 102, FSA.................. 1,317
1,285 Indian River County, Hospital
Revenue, 6.00%, 10/1/10, Callable
1/1/07 @ 102, FSA.................. 1,415
180 Manatee County, Housing Finance
Authority, Mortgage Revenue, 6.38%,
11/1/05............................ 185
3,000 Miami-Dade County, Housing Finance
Authority, Single Family Revenue,
5.90%, 6/1/25, Callable 6/1/08 @
103, FHLMC......................... 3,150
4,850 Miami-Dade County Housing, Revenue,
5.80%, 10/1/12..................... 5,171
1,000 Orlando Water & Electricity Revenue,
8.00%, 4/1/03...................... 1,165
2,830 Pinellas County Housing Authority,
Revenue, AMT, 6.30%, 3/1/29,
Callable 9/1/07 @ 102, GNMA/FNMA... 3,036
1,060 Santa Rosa Bay Bridge Authority,
Revenue, 0.00%, 7/1/16............. 405
4,270 Santa Rosa Bay Bridge Authority,
Revenue, 0.00%, 7/1/19............. 1,369
2,255 Santa Rosa Bay Bridge Authority,
Revenue, 0.00%, 7/1/20............. 685
4,265 Santa Rosa Bay Bridge Authority,
Revenue, 0.00%, 7/1/22............. 1,154
2,920 Tampa Water & Sewer Revenue, ETM,
0.00%, 10/1/05..................... 2,232
--------
36,656
--------
Georgia (1.2%):
1,500 Atlanta Airport Facilities, 6.50%,
1/1/08, AMBAC...................... 1,736
1,000 Atlanta Airport Facilities Revenue,
Series A, 6.50%, 1/1/07, AMBAC..... 1,145
2,000 Burke County Development Authority,
Revenue, 3.95%, 7/01/24, Georgia
Power Company...................... 2,000
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Georgia, continued:
$ 1,215 Columbus Water & Sewer Revenue,
6.30%, 5/1/06, Callable 11/1/02 @
102, FGIC.......................... $ 1,333
--------
6,214
--------
Hawaii (1.0%):
1,000 Honolulu City & County, GO, Series A,
5.60%, 4/1/07, FSA................. 1,083
3,500 Honolulu City & County, GO, Series A,
7.35%, 7/1/08...................... 4,276
--------
5,359
--------
Idaho (2.6%):
2,200 Health Facilities Authority Holy
Cross Health System, Revenue,
5.00%, 12/1/18, Callable 6/1/08 @
101, MBIA.......................... 2,154
1,600 Southern Idaho Regional Solid Waste
District, 5.45%, 11/1/13, Callable
11/1/03 @ 101, LOC: Credit Local de
France............................. 1,660
1,285 Student Loan Fund Marketing
Association, Inc., 6.40%, 10/1/99,
GSL................................ 1,313
1,000 Student Loan Fund Marketing
Association, Inc., AMT, 5.10%,
4/1/02, GSL........................ 1,009
4,500 Student Loan Fund Marketing
Association, Inc., Series C, AMT,
5.60%, 4/01/07, Callable, 10/01/03
@ 102, GSL......................... 4,708
1,300 University Revenue, 5.75%, 4/1/06,
FSA................................ 1,415
1,060 University Revenue, 5.50%, 4/1/13,
Callable 4/1/07 @ 101, MBIA........ 1,115
--------
13,374
--------
Illinois (7.2%):
1,000 Chicago Metro Water Reclamation
District--Greater Chicago Capital
Improvements, GO, Pre-Refunded,
7.25%, 12/1/12..................... 1,256
4,245 Chicago Metro Water Reclamation
District--Greater Chicago Capital
Improvements, GO, Pre-Refunded,
6.25%, 12/1/14, Callable 12/1/05 @
100................................ 4,780
3,045 Chicago Park District, GO, 6.35%,
11/15/08, Callable 11/15/05 @ 102,
MBIA............................... 3,429
2,585 Chicago Water Revenue, 6.50%,
11/1/10, FGIC...................... 3,039
1,450 Chicago, Single Family Mortgage
Revenue, 0.00%, 10/1/09, Callable
10/1/05 @ 78.60, MBIA.............. 729
Continued
24
281
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Illinois, continued:
$ 1,380 Chicago, Single Family Mortgage
Revenue, 0.00%, 10/1/09, MBIA...... $ 641
705 Decatur Economic Development, 7.75%,
6/1/07, Callable 6/1/02 @ 102...... 794
7,225 Development Finance Authority,
Pollution Control Revenue, 7.25%,
6/1/11, Callable 6/1/01 @ 102...... 7,832
810 Evanston Residential Mortgage, 6.38%,
1/1/09, Callable 7/1/02 @ 102,
AMBAC.............................. 858
1,645 Health Facilities Authority Revenue,
6.13%, 11/15/07, Callable 11/15/04
@ 102, MBIA........................ 1,840
1,500 Health Facilities Authority Revenue,
6.75%, 1/1/10, Callable 1/1/00 @
102, FGIC.......................... 1,582
1,280 McHenry County, High School #157, GO,
0.00%, 12/1/11, FSA................ 668
1,370 McHenry County, High School #157, GO,
0.00%, 12/1/12, FSA................ 666
1,620 McHenry County, High School #157, GO,
0.00%, 12/1/13, FSA................ 743
2,500 Student Assistance, Student Loan
Revenue, Series M, AMT, 6.60%,
3/1/07, Callable 3/1/02 @ 102...... 2,669
1,500 Winnebago County, School District
#122, GO, 0.00%, 1/1/13, FSA....... 727
2,500 Winnebago County, School District
#122, GO, 0.00%, 1/1/15, FSA....... 1,078
2,500 Winnebago County, School District
#122, GO, 0.00%, 1/1/16, FSA....... 1,016
3,500 Winnebago County, School District
#122, GO, 0.00%, 1/1/17, FSA....... 1,344
1,350 Winnebago County, School District
#122, Harlem-Loves Park, Refunding,
6.35%, 6/1/07, FGIC................ 1,539
--------
37,230
--------
Indiana (2.9%):
2,150 Brownsburg Industrial Building Corp.,
Revenue, 5.50%, 2/1/15, Callable
2/1/07 @ 102, MBIA................. 2,226
1,000 Fort Wayne Hospital Authority,
Parkview Memorial Hospital Project,
Series A, 7.50%, 11/15/11, Callable
11/15/99 @ 102, FGIC............... 1,061
3,260 Health Facilities Financing
Authority, Hospital Revenue, 6.00%,
8/15/10, Callable 8/15/06 @ 102.... 3,489
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Indiana, continued:
$ 2,820 Indianapolis Economic Development
Revenue, Knob-in-the-Woods Project,
6.38%, 12/1/04, Mandatory Put
12/1/04 @ 100...................... $ 3,120
500 Lawrence Township School District,
6.75%, 1/5/05...................... 564
1,500 New Albany Floyd County, School
Building, 6.20%, 7/1/03............ 1,634
1,500 New Albany Floyd County, School
Building, 6.20%, 7/1/04............ 1,650
1,000 State Vocational Technical College
Building Facilities Fee, 6.50%,
7/1/07, Callable 1/1/05 @ 102,
AMBAC.............................. 1,136
--------
14,880
--------
Iowa (0.8%):
700 Des Moines Water Revenue, Series B,
5.50%, 12/1/04, Callable 12/1/01 @
100................................ 726
1,550 Finance Authority, 6.35%, 7/1/09,
Callable 1/1/03 @ 102, AMBAC....... 1,639
1,000 Finance Authority, Private College
Revenue, 5.75%, 12/1/08, MBIA...... 1,107
795 Finance Authority, Single Family
Mortgage Revenue, Series F, 6.15%,
7/1/04, Callable 1/1/03 @ 102,
AMBAC.............................. 822
--------
4,294
--------
Kansas (1.0%):
2,220 Sedgwick & Shawnee, Single Family
Revenue, 5.50%, 6/1/29, Step
Coupon, 6.70% after 10/1/98........ 2,493
850 Sedgwick County, Family Mortgage
Revenue, Series A-1, 6.50%,
12/1/16, Callable 12/1/07 @ 105,
GNMA............................... 918
1,750 Wichita Hospital Revenue, St. Francis
Regional Hospital, 6.25%, 10/1/10,
Callable 10/1/02 @ 102, MBIA....... 1,904
--------
5,315
--------
Kentucky (1.5%):
800 Campbell & Kenton Counties,
Sanitation District #1, 6.50%,
8/1/05, ETM........................ 884
3,000 Economic Development Financial
Authority, Revenue, 5.00%, 12/1/18,
Callable 6/1/08 @ 101.............. 2,946
1,000 Kenton County, Public Properties
Corp., 5.63%, 12/1/12, Callable
12/1/06 @ 101...................... 1,057
1,000 Martin County Mortgage Section 8,
Revenue, 6.25%, 7/1/23, FHA........ 1,039
Continued
25
282
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 1,310 Owensboro Electric Light & Power
Revenue, 0.00%, 1/1/09, BIG........ $ 471
1,000 Winchester Industrial Building,
7.75%, 7/1/12, Callable 7/1/02 @
102................................ 1,128
--------
7,525
--------
Louisiana (1.0%):
233 Housing Agency Mortgage Revenue,
7.80%, 12/1/09, Callable 6/1/04 @
105, GNMA.......................... 261
915 Housing Agency Mortgage Revenue,
Single Family, Series D-2, AMT,
8.00%, 6/1/27, Callable 12/1/06 @
102, GNMA/FNMA..................... 1,008
1,550 Public Facilities Authority Revenue,
AMT, 6.75%, 9/1/06, Callable 9/1/02
@ 102.............................. 1,638
2,000 St. Charles Parish Pollution Control,
8.25%, 6/1/14, Callable 6/1/99 @
103................................ 2,125
--------
5,032
--------
Maryland (0.2%):
1,150 Anne Arundel County, GO, Series B,
AMT, 7.70%, 3/15/06, Callable
3/15/99 @ 102...................... 1,203
--------
Massachusetts (1.2%):
1,650 Beverly, 6.60%, 3/15/09, Callable
3/15/04 @ 102, FSA................. 1,863
20 Education Loan Authority, AMT, 7.25%,
1/1/09, Callable 1/1/01 @ 102...... 21
2,400 State, GO, Series C, 6.00%, 8/1/09... 2,715
1,465 Worcester, GO, Series A, 6.10%,
5/1/08, Callable 5/1/05 @ 102,
MBIA............................... 1,645
--------
6,244
--------
Michigan (2.2%):
2,845 Lapeer Tax Increment Finance
Authority, Revenue, 5.50%, 6/1/12,
Callable 6/1/08 @ 100.............. 2,889
4,000 Pittsfield Township Housing Corp
Revenue, Series A, 6.00%, 1/1/22,
Callable 7/1/04 @ 103.............. 4,190
2,000 State Hospital Finance Authority
Revenue, Mercy Mount Clemens Corp.,
6.25%, 5/15/11, Callable 5/15/01 @
102................................ 2,127
1,500 State Hospital Finance Authority,
Series A, 8.10%, 10/1/13, Callable
10/1/05 @ 102...................... 1,871
--------
11,077
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Minnesota (0.3%):
$ 1,500 Northern Municipal Power Agency,
Minnesota Electric, Series A,
5.90%, 1/1/07, Callable 1/1/03 @
102, AMBAC......................... $ 1,633
--------
Mississippi (0.3%):
1,475 Home Corp., Single Family, Series D,
5.25%, 7/1/12, Callable 7/1/07 @
105, FNMA/GNMA..................... 1,607
--------
Missouri (2.8%):
1,895 Carthage Waterworks & Wastewater
Treatment Systems, 6.30%, 7/1/09,
Callable 7/1/04 @ 101, MBIA........ 2,118
1,520 Fort Zumwalt School District, 5.20%,
3/1/09, Callable 3/1/07 @ 100,
AMBAC.............................. 1,585
1,735 Fort Zumwalt School District, 5.30%,
3/1/10, Callable 3/1/07 @ 100,
AMBAC.............................. 1,810
1,345 Kansas City Industrial Development
Authority, Multi-Family Housing
Revenue, Series A, AMT, 5.63%,
7/1/05............................. 1,415
1,430 Kansas City Municipal Corp. Revenue,
5.40%, 1/15/08, Callable 1/15/06 @
101, AMBAC......................... 1,521
2,500 St. Louis Convention & Sports
Complex, 5.50%, 8/15/13, Callable
8/15/03 @ 102, MBIA................ 2,582
2,955 St. Louis Land Clearance
Redevelopment Authority Housing
Revenue, 5.95%, 7/1/22, Mandatory
Put 4/1/07 @ 100, FNMA............. 3,179
--------
14,210
--------
Montana (1.1%):
1,000 Health Facilities Authority Revenue,
5.00%, 12/1/13, Callable 6/1/08 @
101, MBIA.......................... 998
1,500 University Revenue, Facilities
Improvement, Series E, 5.00%,
5/15/21, Callable 5/15/08 @ 102,
MBIA............................... 1,485
1,000 University Revenue, Facilities
Improvement, Series F, 4.15%,
11/15/03, AMBAC.................... 999
1,075 University Revenue, Facilities
Improvement, Series F, 4.20%,
11/15/04, AMBAC.................... 1,073
1,020 University Revenue, Facilities
Improvement, Series F, 4.30%,
11/15/05, AMBAC.................... 1,019
--------
5,574
--------
Continued
26
283
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Nevada (2.5%):
$ 5,000 Clark County, Pollution Control
Revenue, 5.30%, 10/1/11, Callable
1/1/03 @ 102, ACA.................. $ 5,105
1,025 Douglas County, School District,
Series A, 5.90%, 6/1/08, Callable
6/1/02 @ 101, FGIC................. 1,100
2,000 Las Vegas, Sewer Revenue, 6.60%,
10/1/12, Callable 4/1/02 @ 102,
FGIC............................... 2,208
1,000 Municipal Bond Bank Project #20-23A,
7.00%, 7/1/01, ETM................. 1,039
3,010 Washoe County, School District, GO,
6.13%, 8/1/07, Callable 8/1/02 @
101, MBIA.......................... 3,247
--------
12,699
--------
New Hampshire (0.3%):
1,225 Higher Education & Health Facilities
Authority Revenue, 6.25%, 1/1/06,
Callable 7/1/04 @ 102.............. 1,351
--------
New Jersey (1.1%):
3,500 Sayreville Housing Development Corp.,
Revenue, 6.00%, 2/1/23, Callable
8/1/03 @ 100, FHA.................. 3,679
1,630 South Brunswick Township, 6.40%,
8/1/07, Callable 8/1/05 @ 100,
FGIC............................... 1,841
--------
5,520
--------
New Mexico (1.4%):
30 Albuquerque, 7.65%, 8/15/07, FGIC.... 32
1,000 Albuquerque Airport Revenue, AMT,
6.50%, 7/1/11, Callable 7/1/00 @
105, AMBAC......................... 1,088
5,455 Educational Assistance Foundation,
Student Loan Revenue, Series A,
AMT, 6.85%, 4/1/05, Callable 4/1/02
@ 102, AMBAC....................... 5,947
--------
7,067
--------
New York (4.4%):
3,100 Long Island Power Agency Authority,
Revenue, 5.13%, 12/1/22, Callable
6/1/08 @ 101, FSA.................. 3,066
1,500 Metropolitan Transportation
Authority, 6.38%, 7/1/10, Callable
7/1/02 @ 102, FGIC................. 1,655
1,395 Nassau County, 5.63%, 8/1/03, FGIC... 1,486
1,980 Radisson Senior Citizens Housing
Corp. Revenue, Series A, 5.63%,
8/1/11............................. 2,059
1,500 State Dorm Authority, Series A,
5.50%, 7/1/04...................... 1,579
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
New York, continued:
$ 2,950 State Dorm Authority, Series A,
5.50%, 7/1/05...................... $ 3,111
1,500 State Dorm Authority, Series A,
5.50%, 7/1/06...................... 1,583
3,000 State, GO, Series B, 5.25%, 8/1/12,
Callable 8/1/07 @ 101.............. 3,054
5,000 State, GO, Series F, 5.13%, 8/1/11,
Callable 2/1/08 @ 101.............. 5,066
--------
22,659
--------
North Carolina (0.5%):
2,500 Educational Facilities, Wake Forest,
5.00%, 11/1/12, Callable 11/1/07 @
102................................ 2,529
--------
North Dakota (2.5%):
3,050 Grand Forks Sales Tax Revenue Bond,
5.10%, 12/15/10, Callable 12/15/07
@ 100.............................. 3,154
160 Housing Finance Agency, AMT, 6.25%,
7/1/09, Callable 7/1/04 @ 102...... 166
3,500 Mercer County, Pollution Control
Revenue, 6.65%, 6/1/22, Callable
6/1/02 @ 102, FGIC................. 3,829
2,910 State Building Authority Lease
Revenue, Series A, 5.13%, 12/1/18,
Callable 12/1/08 @ 100, AMBAC...... 2,888
1,505 State Building Authority Revenue,
Series B, 5.00%, 12/1/10, Callable
12/1/08 @ 100, AMBAC............... 1,535
1,270 Water Development, 5.70%, 7/1/17,
Callable 7/1/07 @ 100, AMBAC....... 1,342
--------
12,914
--------
Ohio (2.7%):
2,000 Butler County Sewer Systems Revenue,
4.70%, 12/1/11, Callable 12/1/08 @
101, AMBAC......................... 1,984
2,000 Butler County Sewer Systems Revenue,
4.80%, 12/1/12, Callable 12/1/08 @
101, AMBAC......................... 1,982
2,100 Mount Vernon, Industrial Development
Revenue, 5.90%, 3/1/03............. 2,105
2,500 Northeast Regional Sewer District,
5.60%, 11/15/13, Callable 11/15/05
@ 101, AMBAC....................... 2,645
2,470 State, Economic Development, 7.50%,
9/1/10, Callable 9/1/02 @ 102...... 2,772
2,500 State, Higher Educational Facilities,
0.00%, 7/1/07...................... 2,531
--------
14,019
--------
Continued
27
284
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Oklahoma (1.8%):
$ 2,500 Baptist Health Center, IDR, 6.25%,
8/15/12, Callable 8/15/05 @ 102,
AMBAC.............................. $ 2,797
1,000 Housing Finance Agency, PG-B-1,
5.60%, 3/1/28, Callable 9/1/07 @
102................................ 1,021
5,500 Water Reservoir Bridge State Loan
Program Revenue, Series A-Conv,
5.00%, 9/1/17, Callable 9/1/08
@ 102.............................. 5,443
--------
9,261
--------
Oregon (2.8%):
2,350 Jackson County, School District #5
Ashland, GO, 5.70%, 6/1/07, FSA.... 2,576
2,580 Lane County, School District #019,
6.00%, 10/15/11, FGIC.............. 2,924
1,000 Lane County, School District #52
Bethel, GO, 6.00%, 6/1/06, FSA..... 1,111
3,630 Marion County, Oregon, 5.50%,
10/1/05, AMBAC..................... 3,892
1,435 Port of Portland Airport Revenue,
Series 7-A, 6.75%, 7/1/09, Callable
7/1/01 @ 101, MBIA................. 1,555
2,075 Washington County, School District
#88, GO, 6.10%, 6/1/05, Callable
12/15/04 @ 100, FSA................ 2,298
--------
14,356
--------
Pennsylvania (3.2%):
3,200 Dauphin County, Industrial
Development Authority, Pollution
Control Revenue, 6.00%, 1/1/08,
MBIA............................... 3,205
1,085 Delaware County, Hospital Authority,
6.00%, 12/15/20, Callable 12/1/03 @
102................................ 1,144
1,500 Hospital Revenue Bond, 6.40%, 1/1/06,
Callable 1/1/05 @ 102, AMBAC....... 1,682
2,750 Indiana County, Industrial
Development Authority, Pollution
Control Revenue, 6.00%, 6/1/06,
MBIA............................... 3,040
2,350 Philadelphia Airport Revenue, Series
A, AMT, 5.50%, 6/15/05, AMBAC...... 2,484
2,500 Philadelphia Water & Waste, 5.65%,
6/15/12, Callable 6/15/03 @ 102,
FGIC............................... 2,612
2,000 State Financial Authority Revenue,
6.60%, 11/1/09, Callable 11/1/03 @
102, LOC: Societe Generale......... 2,218
--------
16,385
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Puerto Rico (1.0%):
$ 5,000 Commonwealth Infrastructure, Series
A, 5.25%, 7/1/10, Callable 7/1/08 @
101, AMBAC......................... $ 5,292
--------
Rhode Island (0.2%):
1,000 Housing & Mortgage Financial Corp.,
Series 15-B, 6.20%, 10/1/06,
Callable 4/1/04 @ 102, MBIA........ 1,069
--------
South Carolina (0.8%):
1,760 Greenville School Public Facilities,
5.60%, 3/1/10...................... 1,885
1,045 Hilton Head Island, GO, 5.50%,
8/1/09, MBIA....................... 1,137
20 Jobs Economic Development Authority
Hospital Facilities Revenue, 5.00%,
11/1/18, Callable 5/1/08 @ 101,
AMBAC.............................. 20
250 Piedmont, Municipal Power Agency,
Electric Revenue, Series A, 6.55%,
1/1/16............................. 250
1,000 York County, School District #3, GO,
5.40%, 3/1/08, Callable 3/1/06 @
101, FSA........................... 1,064
--------
4,356
--------
South Dakota (0.8%):
3,675 Health & Educational Facilities
Authority Revenue, St. Luke's,
6.63%, 7/1/11, Callable 7/1/01 @
102, MBIA.......................... 3,968
--------
Tennessee (1.1%):
1,050 Chattanooga-Hamilton County, Hospital
Authority, Hospital Revenue, 5.63%,
10/1/09, FSA....................... 1,153
1,460 Dyer County, Industrial Development
Revenue, 6.00%, 2/1/07, Callable
2/1/04 @ 102....................... 1,560
2,000 Housing Development, 6.20%, 7/1/18,
Callable 7/1/05 @ 102.............. 2,123
1,000 Trenton Industrial Development
Revenue, Series A, 5.40%,
10/1/02............................ 1,002
--------
5,838
--------
Texas (7.7%):
2,800 Austin Housing Finance Corp., Single
Family Mortgage Revenue, AMT, ETM,
0.00%, 12/1/11..................... 1,379
1,000 Austin Utility Systems Revenue,
0.00%, 5/15/08, MBIA............... 634
1,130 Carroll Independent School District,
GO, 0.00%, 2/15/11, PSFG........... 604
Continued
28
285
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Texas, continued:
$ 1,365 Carroll Independent School District,
GO, 0.00%, 2/15/12, Callable
2/15/08 @ 82.259, PSFG............. $ 683
1,420 Carroll Independent School District,
GO, 0.00%, 2/15/13, PSFG........... 667
1,435 Carroll Independent School District,
GO, 0.00%, 2/15/14, PSFG........... 633
5,125 Cass County, Industrial Development
Revenue, Series A, 5.30%, 7/1/09... 5,372
1,215 Castleberry Independent School
District, Public Facilities Corp.,
5.00%, 8/15/08..................... 1,220
5,000 Coastal Bend Health Facilities,
Incarnate Word Health Services,
5.93%, 11/15/13, Callable 11/15/02
@ 102, AMBAC....................... 5,357
3,600 Grand Prairie Health Facilities
Refunding, Dallas/Fort Worth
Medical Center Project, 6.50%,
11/1/04, AMBAC..................... 4,017
3,300 Grand Prairie Health Facilities
Refunding, Dallas/Fort Worth
Medical Center Project, 6.88%,
11/1/10, AMBAC..................... 3,750
5,000 Harris County, Capital Appreciation,
Toll Road, Sub-Lien A, GO, 0.00%,
8/15/03, MBIA...................... 4,002
3,700 Harris County, Capital Appreciation,
Toll Road, Sub-Lien A, GO, 0.00%,
8/15/05, MBIA...................... 2,695
1,455 Health Facilities Development Corp.,
Hospital Revenue, All Saints
Episcopal Hospital, 6.25%, 8/15/12,
Callable 8/15/03 @ 102, MBIA....... 1,594
1,000 Housing Agency Residential
Development Revenue, Series D, AMT,
8.40%, 1/1/21, Callable 7/1/99 @
102................................ 1,039
1,000 San Antonio Electric & Gas, Series B,
7.00%, 2/1/09, Callable 2/1/99 @
101.5.............................. 1,034
1,145 State Higher Education Coordinating
Board, Student Loan, AMT, 7.45%,
10/1/06, Callable 10/1/01 @ 102.... 1,233
1,020 Tech University Revenues, 5.95%,
2/15/13, Callable 2/15/05 @ 100,
AMBAC.............................. 1,087
2,200 United Independent School District,
5.25%, 8/15/14, Callable 8/15/06 @
100................................ 2,240
--------
39,240
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Utah (1.1%):
$ 2,095 Clearfield City, GO, 5.13%, 2/1/18,
Callable 2/1/08 @ 100, MBIA........ $ 2,080
2,000 Intermountain Power Agency, Power
Supply Revenue, Series B, 6.50%,
7/1/09, MBIA....................... 2,333
1,280 State Housing Finance Authority, AMT,
6.35%, 7/1/12, Callable 1/1/05 @
102................................ 1,356
--------
5,769
--------
Vermont (0.3%):
1,430 University & State Agricultural
College, Series 73 A, 5.80%,
7/1/13............................. 1,445
--------
Virginia (0.7%):
1,340 State Housing Development Authority,
Commonwealth Mortgage, Series J,
6.65%, 7/1/10, Callable 1/1/05 @
102................................ 1,435
2,000 State Housing Development Authority,
Series B Sub B2, 6.70%, 1/1/15,
Callable 1/1/06 @ 102.............. 2,143
--------
3,578
--------
Washington (2.7%):
1,830 Chelan County, Public Utilities
Revenue, 5.90%, 7/1/13, Mandatory
Put 7/1/03 @ 102................... 1,926
1,360 King County, School District #400,
GO, 6.50%, 12/1/08................. 1,596
1,084 Kitsap County, Consolidated Housing,
7.00%, 8/20/08, GNMA............... 1,216
1,000 Seattle Light & Power Revenue, 6.00%,
8/1/13, Callable 8/1/02 @ 102...... 1,072
1,000 Seattle Solid Waste, Series B, 7.00%,
5/1/03, Callable 5/1/99
@ 102, BIG......................... 1,046
3,000 Snohomish County, Public Utility
District #001, Electric Revenue,
6.00%, 1/1/13, Callable 1/1/03 @
102, FGIC.......................... 3,224
3,500 State Nuclear Project #1, Series A,
6.00%, 7/1/08, AMBAC............... 3,891
--------
13,971
--------
West Virginia (2.9%):
1,320 Board of Regents Revenue, Series A,
5.90%, 4/1/04, ETM................. 1,386
2,495 Harrison County, Community Split
Obligation, Series A, 6.25%,
5/15/10............................ 2,870
3,630 Randolph County Community Health,
Revenue, 5.20%, 11/1/21, Callable
11/1/13 @ 100, FSA................. 3,617
Continued
29
286
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 3,500 School Building Authority, Series B,
5.40%, 7/1/17, Callable 7/1/07 @
102, FSA........................... $ 3,599
1,150 State College Revenue, 6.00%, 4/1/12,
Callable 4/1/03 @ 102, AMBAC....... 1,239
1,960 State Housing Development Fund,
Housing Finance, AMT, 7.20%,
11/1/20, Callable 5/1/02 @ 102..... 2,114
--------
14,825
--------
Wisconsin (0.3%):
500 Mukwonago School District, 5.80%,
3/1/07, Prerefunded 3/1/02 @ 100,
AMBAC.............................. 529
1,000 State, Series A, 6.30%, 5/1/07,
Prerefunded 5/1/02 @ 100........... 1,078
--------
1,607
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Wyoming (0.9%):
$ 875 Community Development Authority
Single Family Mortgage, Series A,
7.25%, 6/1/07, Callable 6/1/01
@ 102.............................. $ 915
2,000 Sweetwater County Solid Waste
Disposal Revenue, Series A, AMT,
7.00%, 6/1/24...................... 2,231
1,395 Sweetwater County, School District
#2, Green River, GO, 7.00%, 6/1/04,
MBIA............................... 1,589
--------
4,735
--------
Total Municipal Bonds 503,031
--------
DAILY DEMAND NOTES (0.2%):
New York (0.2%):
1,000 Long Island Power Authority Electric
Revenue, Series 6, 3.75%, 5/1/33... 1,000
--------
Total Daily Demand Notes 1,000
--------
MONTHLY DEMAND NOTES (1.5%):
California (0.4%):
2,000 Educational Loan Marketing Corp.,
Revenue, Series IV-C-1, 4.00%,
1/1/33............................. 2,000
--------
Florida (1.1%):
5,800 Educational Loan Marketing Corp.,
Revenue, Series A, 4.00%,
12/1/18............................ 5,800
--------
Total Monthly Demand Notes 7,800
--------
Total (Cost $487,954) (a) $511,831
========
- ------------
Percentages indicated are based on net assets of $513,860.
Continued
30
287
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Tax-Free Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
(a) Represents cost for financial reporting and federal income tax purposes and
differs from value by net unrealized appreciation of securities as follows
(amounts in thousands):
Unrealized appreciation..................................... $23,972
Unrealized depreciation..................................... (95)
-------
Net unrealized appreciation................................. $23,877
=======
* Variable rate securities having liquidity sources through bank letters of
credit or other cards and/or liquidity agreements. The interest rate, which
will change periodically, is based upon bank prime rates or an index of
market rates. The rate reflected on the Schedule of Portfolio Investments is
the rate in effect at June 30, 1998.
ACA American Capital Access
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax Paper
BIG Insured by Bond Insurance Guarantee
ETM Escrowed to Maturity
FGIC Insured by Federal Guarantee Insurance Corp.
FNMA Insured by Federal National Mortgage Association
FSA Insured by Federal Security Assurance
GNMA Insured by Government National Mortgage Association
GO General Obligation
GSL Guaranteed Student Loans
IDR Industrial Development Revenue
LOC Letters of Credit
MBIA Insured by Municipal Bond Insurance Association
PSFG Permanent School Funding Guarantee
See notes to financial statements.
31
288
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS (98.3%):
Alabama (0.2%):
$ 540 Housing Finance Authority, Series
A-1, 5.80%, 10/1/08, Callable
4/1/05 @ 102, GNMA................. $ 569
1,540 Mobile Refunding & Improvement, GO,
0.00%, 2/15/14, Callable 2/15/08 @
76.49, MBIA........................ 688
1,500 Mobile Refunding & Improvement, GO,
0.00%, 8/15/14, Callable 2/15/08 @
74.5, MBIA......................... 652
--------
1,909
--------
Alaska (1.8%):
755 Anchorage, Series A, 5.40%, 4/1/07,
Callable 4/1/06 @ 100, MBIA........ 800
3,570 Energy Authority, Utility Revenue,
5.20%, 7/1/17, Callable 7/1/08 @
100, FSA........................... 3,585
1,005 Home Mortgage Revenue Refunding,
8.00%, 3/1/09, Callable 3/1/02 @
102, FNMA.......................... 1,079
8,440 State Housing Finance Corp., 0.00%,
12/1/17, Callable 6/1/07 @ 54,
MBIA............................... 2,653
30,000 State Housing Finance Corp., Series
A-2, AMT, 0.00%, 6/1/37, Callable
12/1/07 @ 17.74.................... 3,069
2,750 Student Loan Corp., Series A, AMT,
5.75%, 7/1/14, Callable 7/1/07 @
100, AMBAC......................... 2,943
--------
14,129
--------
Arizona (2.7%):
11,705 Maricopa County, Industrial
Development Authority Revenue,
Coral Point Apartments, Series A,
4.95%, 3/1/28, Callable 3/1/06 @
101................................ 11,747
325 Maricopa County, Industrial
Development, Multi-Family Housing
Revenue, 7.25%, 7/1/17, Callable
7/1/07 @ 101....................... 343
1,500 Maricopa County, Industrial
Development, Multi-Family Housing
Revenue, Series A, 6.25%, 7/1/27,
Callable 1/1/07 @ 101.............. 1,563
3,000 Phoenix Industrial Development
Authority, Single Family Mortgage,
6.60%, 12/1/29, Callable 12/1/07 @
101.5, GNMA/FNMA/FHLMC............. 3,292
1,210 Pima County Industrial Development
Authority Revenue, Wester, 5.38%,
6/1/10............................. 1,208
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 1,000 Show Low Industrial Development
Authority Hospital Revenue, 5.50%,
12/1/17, Callable 12/1/07 @ 102,
ACA................................ $ 1,011
2,040 Yuma, Individual & Multi-Family
Apartments, Series A, 5.40%,
12/20/17, Callable 12/20/04 @ 100,
GNMA............................... 2,059
--------
21,223
--------
Arkansas (2.0%):
280 Drew County, Public Facilities Board,
7.90%, 8/1/11, Callable 8/1/03 @
103, FNMA.......................... 303
122 Drew County, Public Facilities Board,
7.75%, 8/1/11, Callable 2/1/04 @
100................................ 130
468 Jacksonville, Residential Housing
Facilities Board, Single Family
Mortgage Revenue, 7.90%, 1/1/11,
Callable 7/1/03 @ 103.............. 511
212 Jacksonville, Residential Housing
Facilities Board, Single Family
Mortgage Revenue, 7.75%, 1/1/11,
Callable 7/1/05 @ 103.............. 231
195 Lonoke County, Residential Housing
Facilities Board, Single Family
Mortgage Revenue, 7.38%, 4/1/11,
Callable 4/1/03 @ 103.............. 212
564 Lonoke County, Residential Housing
Facilities Board, Single Family
Mortgage Revenue, Series A-2,
7.90%, 4/1/11, FNMA................ 616
1,000 Paragould, Hospital Revenue, 6.38%,
10/1/17, Callable 10/1/06 @ 102.... 1,075
953 Pope County, Residential Facilities,
Housing Board Mortgage Revenue,
Series B, 7.75%, 9/1/11, Callable
8/1/02 @ 102, FHA.................. 1,022
1,500 State Capital Appreciation, College
Savings, Series 97A, 0.00%,
6/1/16............................. 596
2,000 State Capital Appreciation, College
Savings, Series A, 0.00%, 6/1/15... 843
1,810 State Development Authority Revenue
Refunding, 8.00%, 8/15/11, Callable
8/15/01 @ 103...................... 1,939
3,650 State Development Finance Authority
Revenue, 0.00%, 6/1/15............. 1,424
845 State Development Finance Authority
Revenue, Single Family Housing,
7.75%, 4/1/21, Callable 4/1/99 @
102, GNMA.......................... 871
Continued
32
289
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arkansas, continued:
$ 5,000 State Development Finance Authority,
Multi-Family Mortgage Revenue,
Series A, 5.45%, 7/1/24, Callable
7/2/98 @ 100, MBIA................. $ 5,000
440 Stuttgart Public Facilities Board
Revenue, Series A-2, 7.90%, 9/1/11,
Callable 9/1/03 @ 103.............. 480
244 Stuttgart Public Facilities Board
Revenue, Series B, 7.75%, 9/1/11,
Callable 3/1/06 @ 103.............. 267
--------
15,520
--------
California (3.1%):
430 ABAG Finance Authority for Nonprofit
Corp., 5.85%, 10/1/27, Callable
10/1/07 @ 102...................... 445
4,749 Contra Costa County, Multi-Family
Mortgage Revenue, Crescent Park,
Series B, 7.80%, 6/20/34, Callable
6/20/04 @ 105, GNMA................ 5,392
1,255 Fairfield, Water Revenue, 0.00%,
4/1/15, Callable 4/1/05 @ 56.7,
AMBAC.............................. 521
1,690 Fresno Housing Authority, Project B,
AMT, 5.60%, 8/1/30, Callable 8/1/07
@ 102.............................. 1,742
1,080 Housing Finance Agency Revenue, Home
Mortgage, AMT, 7.50%, 2/1/23,
Callable 8/1/05 @ 102, FHA......... 1,187
15 Housing Finance Agency Revenue, Home
Mortgage, Series C, AMT, 7.45%,
8/1/11, Callable 8/1/01 @ 102...... 15
680 Housing Finance Agency Revenue, Local
or Guaranteed Housing, Series B,
8.63%, 8/1/15, Callable 8/1/00 @
100, MBIA.......................... 706
210 Housing Finance Agency Revenue,
Series H, AMT, 6.80%, 8/1/19,
Callable 8/1/04 @ 102, FHA......... 220
780 Housing Finance Agency Revenue,
Single Family Housing, Series F,
7.88%, 8/1/19, Callable 8/1/98 @
102................................ 797
1,460 Los Angeles Housing Authority, Multi-
Family Mortgage Revenue, The Pal,
5.30%, 7/1/18, Callable 7/1/08 @
102, FNMA.......................... 1,460
100 Los Angeles, Water & Power Electric
Revenue, 4.50%, 8/15/98............ 100
1,000 Oakland, Revenue Refunding, Series A,
7.60%, 8/1/21, Callable 8/1/98 @
102, FGIC.......................... 1,023
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
California, continued:
$ 700 Redondo Beach, Redevelopment Agency,
Residential Mortgage Revenue,
Series B, 6.25%, 6/1/11, Callable
6/1/03 @ 100....................... $ 717
810 Rural Home Mortgage Financing
Authority, AMT, 7.55%, 11/1/26..... 939
805 Rural Home Mortgage Financing
Authority, AMT, 7.75%, 5/1/27...... 934
1,180 San Joaquin Hills Toll Road,
Prerefunded, 0.00%, 1/1/14......... 550
4,435 San Joaquin Hills Toll Road,
Prerefunded, 0.00%, 1/1/16......... 1,846
1,350 San Marcos Public Facilities, 0.00%,
9/1/19............................. 465
3,725 Santa Clara County Housing Authority
Revenue, Cedar Glen Apartments,
0.00%, 4/1/26, Callable 10/1/98 @
5.52, MBIA, FHA.................... 203
1,820 Statewide Community Development
Authority Multi-Family Revenue,
Cudahy Gardens, Series I, AMT,
5.60%, 4/1/29, Callable 4/1/03 @
102, LOC: Swiss Bank............... 1,827
3,400 Statewide Community Development
Authority Multi-Family Revenue,
Cudahy Gardens, Series J, AMT,
5.60%, 4/1/29, Callable 4/1/03 @
102, LOC: Swiss Bank............... 3,413
--------
24,502
--------
Colorado (15.4%):
5,250 Arapahoe County, Highway Revenue,
Series C, 0.00%, 8/31/15, Callable
8/31/05 @ 48.6..................... 1,859
4,920 Aurora, Industrial Development,
McKesson Corp., Series A, 5.38%,
12/1/11, Callable 12/1/02 @ 102.... 5,050
5,030 Aurora, Single Family Mortgage
Revenue, Series A2, 0.00%, 9/1/15,
Prerefunded 3/1/13 @ 75.2.......... 1,840
2,205 Brush Creek Metropolitan District,
GO, Refunding, 6.70%, 11/15/09,
Callable 11/15/03 @ 101............ 2,388
400 Central City Water Revenue, GO, Water
Utility Improvements, 8.63%,
9/15/11, Prerefunded 9/15/02 @
100................................ 468
655 Central City Water Revenue, GO, Water
Utility Improvements, 7.50%,
12/1/12, Prerefunded 12/1/02 @
100................................ 742
3,700 Colorado Springs Airport Revenue,
AMT, 6.90%, 1/1/12, Callable 1/1/03
@ 102, MBIA........................ 4,081
Continued
33
290
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Colorado, continued:
$ 1,100 Cordillera Metropolitan District,
Eagle County, GO, 5.40%, 12/1/12,
Callable 12/1/08 @ 101............. $ 1,097
1,625 Cordillera Metropolitan District,
Eagle County, GO, 5.50%, 12/1/17,
Callable 12/1/08 @ 101............. 1,607
1,000 Denver Housing Corp., Series A,
5.35%, 10/1/12, Callable 10/1/07 @
101................................ 1,021
2,500 Denver, City & County Airport
Revenue, AMT, 5.63%, 11/15/08,
Callable 11/15/06 @ 102, MBIA...... 2,702
885 Denver, City & County Airport
Revenue, AMT, 6.75%, 11/15/13,
Callable 11/15/02 @ 102, MBIA...... 971
20,610 Denver, City & County Mortgage, AMT,
0.00%, 8/1/29...................... 3,252
1,000 Denver, City & County Residual
Revenue, Single Family, Series A,
0.00%, 7/1/10, Callable 7/1/08 @
91.87.............................. 534
9,850 Denver, City & County Residual
Revenue, Single Family, Series A,
0.00%, 7/1/14, Callable 7/1/08 @
73.66.............................. 4,133
2,910 Denver, City & County, Single Family
Mortgage Revenue, Metro Mayors,
6.00%, 4/1/22, Callable 4/1/08 @
101, GNMA/FNMA..................... 3,094
3,535 Denver, City & County, Single Family
Mortgage Revenue, Metro Mayors,
0.00%, 10/1/30..................... 568
1,475 Douglas County, Multi-Family Housing
Revenue, Parker Hilltop, AMT,
5.35%, 8/1/18, FHA................. 1,478
1,250 Eagle's Nest Metropolitan District,
GO, Refunding, 6.50%, 11/15/17,
Callable 9/1/10 @ 100.............. 1,330
198 El Paso County, Home Mortgage, Series
C, 8.30%, 9/20/18.................. 220
1,145 El Paso County, Single Family
Mortgage Revenue, 0.00%, 9/1/15,
ETM................................ 485
8,700 El Paso County, Single Family
Mortgage Revenue, Series A, AMT,
0.00%, 12/1/30, Callable 6/1/08 @
102, GNMA/FNMA..................... 1,447
2,500 Englewood, Multi-Family Housing,
Marks Apartment Revenue, 6.65%,
12/1/26, Callable 12/1/06 @ 102.... 2,711
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Colorado, continued:
$ 1,415 Englewood, Multi-Family Housing,
Marks Apartment Revenue, Series B,
6.00%, 12/15/18, Callable 12/15/03
@ 100, LOC: Citibank............... $ 1,441
2,500 Health Facilities Authority Revenue,
Steamboat Springs, 5.75%, 9/15/22,
Callable 9/15/08 @ 101............. 2,555
1,685 Housing Finance Authority, GO, 6.80%,
8/1/14, Callable 8/1/02 @ 102...... 1,787
165 Housing Finance Authority,
Multi-Family Mortgage Revenue, AMT,
5.75%, 10/1/06, Callable 4/1/06 @
102................................ 175
1,445 Housing Finance Authority,
Multi-Family Mortgage Revenue,
Series A, 9.00%, 10/1/25, Callable
10/1/00 @ 100, FHA................. 1,450
1,095 Housing Finance Authority,
Multi-Family Mortgage Revenue,
Series A-2, AMT, 5.35%, 10/1/18,
Callable 10/1/09 @ 100............. 1,097
2,000 Housing Finance Authority,
Multi-Family Mortgage Revenue,
Series A-2, AMT, 5.45%, 10/1/29,
Callable 10/1/08 @ 101............. 2,003
2,560 Housing Finance Authority,
Multi-Family Mortgage Revenue,
Series B, 6.00%, 10/1/25, Callable
2/11/98 @ 100.5, FHA............... 2,141
1,500 Housing Finance Authority,
Multi-Family Mortgage Revenue,
Series B-2, AMT, 5.80%, 10/1/28,
Callable 4/1/07 @ 101.5, FHA....... 1,544
3,000 Housing Finance Authority,
Multi-Family Mortgage Revenue,
Series C-3, 5.70%, 10/1/21,
Callable 11/1/98 @ 100, FHA........ 3,040
2,500 Housing Finance Authority, Series
B-2, AMT, 7.00%, 5/1/26, Callable
5/1/07 @ 105....................... 2,786
2,500 Housing Finance Authority, Series
C-2, AMT, 6.88%, 11/1/28, Callable
11/1/07 @ 105...................... 2,798
3,550 Housing Finance Authority, Single
Family Mortgage Revenue, 7.45%,
11/1/27, Callable 5/1/06 @ 105..... 4,069
10,250 Housing Finance Authority, Single
Family Mortgage Revenue, AMT,
7.25%, 5/1/27, Callable 5/1/07 @
105................................ 11,580
860 Housing Finance Authority, Single
Family Mortgage Revenue, Series
95C, 7.45%, 6/1/17, Callable 6/1/05
@ 105.............................. 973
Continued
34
291
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Colorado, continued:
$ 490 Housing Finance Authority, Single
Family Mortgage Revenue, Series A,
0.00%, 9/1/14, FHA................. $ 94
2,000 Housing Finance Authority, Single
Family Mortgage Revenue, Series
A-2, AMT, 6.60%, 5/1/28, Callable
5/1/08 @ 105....................... 2,208
1,000 Housing Finance Authority, Single
Family Mortgage Revenue, Series
A-3, 6.50%, 5/1/16, Callable 5/1/08
@ 105.............................. 1,100
345 Housing Finance Authority, Single
Family Mortgage Revenue, Series
A-3, 6.50%, 11/1/23, Callable
5/1/02 @ 102....................... 358
500 Housing Finance Authority, Single
Family Mortgage Revenue, Series
A-3, 6.50%, 11/1/29, Callable
5/1/08 @ 105....................... 555
3,500 Housing Finance Authority, Single
Family Mortgage Revenue, Series
C-1, 7.55%, 11/1/27, Callable
11/1/06 @ 102...................... 3,969
7,695 Housing Finance Authority, Single
Family Mortgage Revenue, Series
PG-C-1, AMT, 0.00%, 11/1/29,
Callable 5/1/08 @ 30.95............ 1,345
6,730 Housing Finance Authority, Single
Family Mortgage Revenue, Series
PG-C-SR, AMT, 0.00%, 11/1/29,
Callable 5/1/08 @ 31.77............ 1,222
755 Housing Finance Authority, Single
Family Program, Series B, 6.13%,
5/1/13, Callable 11/1/04 @ 103,
FHA................................ 786
700 Housing Finance Authority, Single
Family Program, Series B, 7.50%,
11/1/24, Callable 11/1/04 @ 105,
FHA................................ 779
360 Housing Finance Authority, Single
Family Program, Series D-1, 6.60%,
8/1/17, Callable 8/1/01 @ 102,
FHA................................ 369
2,000 Housing Finance Authority, Single
Family Program, Series D-1, 7.38%,
6/1/26, Callable 12/1/05 @ 105..... 2,247
605 Housing Finance Authority, Single
Family Program, Series E, AMT,
6.25%, 12/1/09, Callable 12/1/04 @
103................................ 640
310 Housing Finance Authority, Single
Family Program, Sub Series A, AMT,
6.50%, 12/1/02..................... 323
880 Jefferson County, Single Family
Mortgage Revenue, Refunding, Series
A, 8.88%, 10/1/13, Callable 4/1/01
@ 103, MBIA........................ 940
7,525 Meridian Metropolitan District,
7.50%, 12/1/11, Callable 12/1/01 @
101................................ 8,211
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Colorado, continued:
$ 1,500 Mesa County, Residual Revenue
Refunding, 0.00%, 12/1/11, ETM..... $ 792
1,720 Mountain Village Metropolitan
District, 8.10%, 12/1/11,
Prerefunded 12/1/02 @ 101.......... 2,005
890 Mountain Village Metropolitan
District, San Miguel County, 7.95%,
12/1/03, Callable 12/1/02 @ 101.... 994
835 Mountain Village Metropolitan
District, San Miguel County, 8.10%,
12/1/11, Callable 12/1/02 @ 101.... 957
2,630 Mountain Village Metropolitan
District, San Miguel County, 5.15%,
12/1/13, Callable 12/1/07 @ 101.... 2,677
3,700 Mountain Village Metropolitan
District, San Miguel County, 5.20%,
12/1/17, Callable 12/1/07 @ 101.... 3,724
--------
118,812
--------
Connecticut (1.9%):
4,350 Stamford, Connecticut Housing
Authority, Rippowam Project, 6.25%,
10/1/19, Callable 10/1/08 @ 103.... 4,658
9,200 Stamford, Connecticut Housing
Authority, Rippowam Project, 6.38%,
10/1/29, Callable 10/1/08 @ 103.... 9,833
175 State Housing Mortgage, Series A,
7.63%, 11/15/17, Callable 11/15/99
@ 100.............................. 178
--------
14,669
--------
Delaware (1.8%):
8,588 Greystone Tax-Exempt Asset Trust,
Series 98-1, Class A-1, 4.30%,
6/20/00............................ 8,623
5,490 Greystone Tax-Exempt Asset Trust,
Series 98-1, Class A-3, 4.40%,
11/2/04............................ 5,472
680 New Castle County, Single Family
Mortgage Revenue, 0.00%, 11/1/16,
FGIC............................... 112
--------
14,207
--------
Florida (5.2%):
690 Brevard County, Housing Finance
Authority, Single Family Mortgage
Revenue, AMT, 6.13%, 9/1/09,
Callable 9/1/04 @ 102.............. 714
490 Clearwater Housing Authority Revenue,
Hamptons At Clearwater, 5.30%,
5/1/18, Callable 5/1/13 @ 100,
ACA................................ 492
4,510 Duval County, Housing Finance
Authority, Single Family Mortgage
Revenue, Series C, 7.35%, 7/1/24,
Callable 9/1/00 @ 103, FGIC........ 4,800
Continued
35
292
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Florida, continued:
$ 175 Escambia County, Housing Finance
Authority, Single Family Revenue,
AMT, 6.60%, 10/1/12, Callable
4/1/05 @ 102, GNMA................. $ 182
1,250 Halifax Hospital Medical Center,
Florida Health Care Facilities
Revenue, 5.20%, 4/1/18, Callable
4/1/08 @ 101, ACA.................. 1,240
430 Housing Finance Authority, Home
Ownership Revenue, 7.50%, 9/1/14,
Callable 9/1/00 @ 102, GNMA........ 453
3,000 Lee County, Housing Finance
Authority, Single Family Mortgage
Revenue, 5.05%, 3/1/28, Callable
3/1/08 @ 102....................... 2,986
1,000 Lee County, Housing Finance
Authority, Single Family Mortgage
Revenue, 6.40%, 3/1/29, Callable
3/1/08 @ 105....................... 1,104
1,000 Lee County, Housing Finance
Authority, Single Family Mortgage
Revenue, 6.30%, 3/1/29, Callable
3/1/08 @ 102....................... 1,105
2,000 Lee County, Housing Finance
Authority, Series A, AMT, 6.85%,
3/1/29, Callable 9/1/07 @ 105,
FNMA............................... 2,258
2,680 Lee County, Housing Finance
Authority, Single Family Mortgage
Revenue, 7.20%, 3/1/27, Callable
3/1/07 @ 105....................... 3,026
705 Leon County, Housing Finance
Authority, Multi-County Program,
Series B, AMT, 7.30%, 1/1/28....... 802
1,445 Manatee County, Housing Finance
Authority, Mortgage Revenue, 8.38%,
5/1/25, Callable 5/1/04 @ 105...... 1,664
2,250 Manatee County, Housing Finance
Authority, Mortgage Revenue, AMT,
7.20%, 5/1/28, Callable 3/1/07 @
105, GNMA.......................... 2,545
1,495 Manatee County, Housing Finance
Authority, Single Family Mortgage
Revenue, Sub Series One, AMT,
6.30%, 11/1/28, Callable 5/1/08 @
107.25, GNMA/FNMA.................. 1,657
790 Orange County, Housing Finance
Authority, Mortgage Revenue, Series
A, AMT, 7.25%, 9/1/19, Callable
3/1/01 @ 103....................... 836
800 Orange County, Housing Finance
Authority, Mortgage Revenue, Series
A, AMT, 7.38%, 9/1/24, Callable
3/1/01 @ 103, FHA.................. 849
1,000 Palm Beach County, Housing Finance
Authority, Revenue, Windsor Park,
Series A, AMT, 5.80%, 12/1/28,
Callable 6/1/08 @ 102.............. 1,009
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Florida, continued:
$ 530 Palm Beach County, Housing Finance
Authority, Single Family Mortgage
Revenue, Series A, AMT, 6.38%,
10/1/06, Callable 10/1/04 @ 102.... $ 555
1,555 Pinellas County, Housing Finance
Authority, Single Family Mortgage
Revenue, Multi-County, Series A,
6.35%, 2/1/17, Callable 2/1/05 @
102................................ 1,625
2,450 Pinellas County, Housing Finance
Authority, Single Family Mortgage
Revenue, Series 95-A, AMT, 6.25%,
8/1/12, Callable 2/1/05 @ 102...... 2,597
2,030 Polk County, Housing Finance
Authority, Single Family Mortgage
Revenue, Series A, AMT, 7.88%,
9/1/22, Callable 3/1/00 @ 103...... 2,138
1,175 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/16...................... 449
4,380 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/18...................... 1,483
410 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/19...................... 131
1,320 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/08, ACA................. 812
1,625 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/09, ACA................. 942
1,535 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/12, ACA................. 741
1,035 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/14, ACA................. 447
1,080 Santa Rosa Bay Bridge Authority,
0.00%, 7/1/16, ACA................. 419
500 State Finance Department, 6.25%,
7/1/09, Callable 7/1/02 @ 101,
MBIA............................... 544
--------
40,605
--------
Georgia (1.1%):
785 De Kalb County, Housing Authority
Revenue, 6.40%, 5/1/05, Callable
5/1/04 @ 100....................... 820
5,000 De Kalb County, Housing Authority
Revenue, Multi-Family Housing,
7.05%, 1/1/39, Callable 1/1/08 @
104, FHA........................... 5,545
575 De Kalb County, Housing Authority
Revenue, Single Family Housing,
AMT, 7.65%, 6/1/18, Callable 6/1/04
@ 100, GNMA........................ 610
Continued
36
293
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Georgia, continued:
$ 1,765 Fulton County, Housing Authority
Revenue, Multi-Family Housing,
Series A, AMT, 6.30%, 7/1/16,
Callable 7/1/06 @ 102.............. $ 1,861
--------
8,836
--------
Idaho (1.4%):
1,010 Boise State University Student Union
And Housing Revenue, 5.00%, 4/1/12,
Callable 4/1/08 @ 101, FSA......... 1,015
1,055 Boise State University Student Union
And Housing Revenue, 5.05%, 4/1/13,
Callable 4/1/08 @ 101, FSA......... 1,060
1,115 Boise State University Student Union
And Housing Revenue, 5.10%, 4/1/14,
Callable 4/1/08 @ 101, FSA......... 1,120
1,360 Housing & Financial Assistance,
Single Family Mortgage Revenue,
Series D, AMT, 6.45%, 7/1/14,
Callable 1/1/06 @ 102, FHA......... 1,464
2,155 Housing & Financial Assistance,
Single Family Mortgage Revenue,
Series H, AMT, 6.05%, 7/1/14,
Callable 1/1/07 @ 102, FHA......... 2,274
230 Housing Agency, Single Family
Mortgage Revenue, AMT, 6.30%,
7/1/24, Callable 1/1/03 @ 102...... 238
1,075 Housing Finance Assistance,
Single Family Mortgage Revenue,
Series 97E-2, AMT, 5.95%, 7/1/14,
Callable 1/1/07 @ 101.5............ 1,127
1,520 Power County, PCR, 5.63%, 10/1/14.... 1,553
1,250 Student Loan Marketing Association
Revenue, Series C, AMT, 5.15%,
4/1/03............................. 1,264
--------
11,115
--------
Illinois (6.2%):
5,890 Addison Alton Electric Public
Improvements Revenue, Sub Series 1,
0.00%, 7/1/11, Callable 7/1/04 @
62................................. 2,731
12,410 Aurora, Illinois Fox Valley
Apartments, 5.3%, 11/1/27, Callable
11/1/05 @ 101...................... 12,661
310 Aurora, Single Family Mortgage
Revenue Refunding, Series B, AMT,
8.05%, 9/1/25, Callable 9/1/04 @
105................................ 353
2,355 Bolingbrook Mortgage Revenue, Capital
Appreciation, Sub Series 1, 0.00%,
1/1/11, Callable 1/1/00 @ 48.6..... 955
2,000 Chicago, Single Family Mortgage
Revenue, AMT, 6.95%, 9/1/28,
Callable 9/1/07 @ 105, AMBAC....... 2,253
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Illinois, continued:
$ 7,250 Chicago, Single Family Mortgage
Revenue, Series A-1, AMT, 6.45%,
9/1/29, Callable 9/1/08 @ 105,
GNMA/FNMA/FHLMC.................... $ 7,937
1,375 Chicago, Residential Mortgage
Revenue, 0.00%, 10/1/09, MBIA...... 639
1,415 Chicago, Single Family Mortgage
Revenue, AMT, 7.63%, 9/1/27,
Callable 6/15/06 @ 105, GNMA....... 1,616
2,000 Chicago, Single Family Mortgage
Revenue, Series 97-A, AMT, 7.25%,
9/1/28, Callable 9/1/07 @ 105,
GNMA............................... 2,263
3,355 Chicago, Single Family Mortgage
Revenue, Series A, AMT, 7.00%,
9/1/27, Callable 3/1/06 @ 105...... 3,736
695 Clay County Hospital Revenue, 5.70%,
12/1/18, Callable 12/1/08 @ 102.... 692
1,070 Clay County Hospital Revenue, 5.90%,
12/1/28, Callable 12/1/08 @ 102.... 1,076
2,265 Cook County High School District
#200, Oak Park, GO, 0.00%, 12/1/12,
FSA................................ 1,100
640 Danville, Single Family Mortgage
Revenue Refunding, 7.30%, 11/1/10,
Callable 11/1/03 @ 102............. 683
3,530 Freeport, Single Family Mortgage
Revenue, 0.00%, 8/1/10, Callable
10/1/01 @ 49....................... 1,344
1,875 Health Care Facilities Authority
Revenue, Victory Health Services,
Series A, 5.75%, 8/15/27, Callable
8/15/07 @ 101...................... 1,928
730 Housing Development Authority,
Residential Mortgage Revenue,
Series A, AMT, 7.35%, 8/1/10,
Callable 8/1/01 @ 102.............. 769
1,280 Lake and McHenry Counties, School
District, GO, 0.00%, 2/1/11,
FGIC............................... 695
4,685 Moline, Mortgage Revenue, Capital
Appreciation, Sub Series 1, 0.00%,
5/1/11, Callable 5/1/05 @ 65....... 1,893
815 Quincy, Single Family Mortgage
Revenue Refunding, 6.88%, 3/1/10,
Callable 3/1/04 @ 102.............. 868
355 Rock Island, Residential Mortgage
Revenue Refunding, 7.70%, 9/1/08,
Callable 9/1/02 @ 102.............. 380
300 State, 4.40%, 12/1/03, MBIA.......... 303
1,000 State Sales Tax, Series S, 4.80%,
6/15/06, OID @ 99.52............... 1,028
--------
47,903
--------
Continued
37
294
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Indiana (1.3%):
$ 2,250 Marion County, Hospital Authority
Revenue, 6.50%, 9/1/13, Callable
9/1/99 @ 102, ETM.................. $ 2,479
3,500 State Housing Finance Authority,
Single Family Mortgage Revenue,
Series A-2, AMT, 6.45%, 7/1/14,
Callable 7/1/05 @ 102, FHA......... 3,737
660 State Housing Finance Authority,
Single Family Mortgage Revenue,
Series B-2, AMT, 7.80%, 1/1/22,
Callable 7/1/00 @ 102, GNMA........ 692
3,130 State Toll Finance Authority, Toll
Road Revenue, 6.00%, 7/1/15,
Callable 7/1/98 @ 100.............. 3,135
--------
10,043
--------
Iowa (0.9%):
585 Davenport, Home Ownership Mortgage
Revenue Refunding, 7.90%, 3/1/10,
Callable 9/1/04 @ 102.............. 625
910 Finance Authority, Multi-Family
Mortgage Revenue, AMT, 7.15%,
12/1/09............................ 990
10,295 Finance Authority, Single Family
Mortgage Revenue, 0.00%, 9/1/16,
AMBAC.............................. 1,363
550 Finance Authority, Single Family
Mortgage Revenue, AMT, 7.90%,
11/1/22, Callable 11/1/99 @ 102,
GNMA............................... 579
2,315 Finance Authority, Single Family
Mortgage Revenue, Mortgage Backed
Securities Program, Series C,
6.40%, 7/1/19, Callable 1/1/05 @
102, GNMA.......................... 2,457
850 Salix, PCR, Gas & Electric Project,
5.75%, 6/1/03, Callable 12/1/98 @
100................................ 855
--------
6,869
--------
Kansas (2.1%):
290 Finney County, Single Family Mortgage
Revenue, 8.95%, 10/1/09, Callable
10/1/98 @ 100...................... 291
675 Ford County, Single Family Mortgage
Revenue, 7.90%, 8/1/10, Callable
8/1/02 @ 103, FHA.................. 727
1,930 Johnson County, Single Family
Mortgage Revenue, 7.10%, 5/1/12,
Callable 5/1/04 @ 103.............. 2,103
435 Labette County, Single Family
Mortgage Revenue, Series A, 8.40%,
12/1/11, Callable 6/1/03 @ 103..... 467
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Kansas, continued:
$ 270 Olathe & Labette County, Single
Family Mortgage Revenue, Series
A-I, AMT, 8.10%, 8/1/23, Callable
2/1/05 @ 105....................... $ 303
2,505 Olathe County, Multi-Family Housing
Project, Series A, 5.75%, 7/1/12,
Callable 7/1/07 @ 101.............. 2,566
1,005 Olathe County, Multi-Family Housing,
Project B, AMT, 5.80%, 7/1/12,
Callable 7/1/07 @ 101.............. 1,030
2,400 Reno & Labette County, Single Family
Mortgage Revenue, Series A, 0.00%,
12/1/15, ETM, FGIC................. 1,003
440 Reno County, Single Family Mortgage
Revenue, Series B, 8.70%, 9/1/11,
Callable 9/1/01 @ 103.............. 480
2,500 Sedgwick & Shawnee County, Series
A-1, AMT, 5.50%, 6/1/29, GNMA...... 2,762
400 Sedgwick & Shawnee County, Single
Family Mortgage Revenue, Series B,
8.05%, 5/1/14, GNMA................ 442
440 Sedgwick & Shawnee County, Single
Family Mortgage Revenue, Series
B-2, 7.80%, 5/1/14, Callable
11/1/04 @ 103...................... 483
460 Sedgwick & Shawnee County, Single
Family Mortgage Revenue, Series
C-2, 7.80%, 11/1/24, Callable
11/1/04 @ 105, GNMA................ 513
1,940 Sedgwick County, Mortgage Loan
Revenue, Series B, AMT, 7.80%,
6/1/22, Callable 6/1/00 @ 103,
AMBAC, GNMA........................ 2,047
2,120 Shawnee County, Single Family
Mortgage Revenue, 0.00%, 10/1/16,
Callable 10/1/01 @ 23, MBIA........ 342
860 Wichita, Single Family Mortgage
Revenue, Series A, 7.10%, 9/1/09,
Callable 3/1/03 @ 103.............. 913
--------
16,472
--------
Kentucky (0.3%):
460 Housing Corp. Revenue, Series D, AMT,
6.13%, 7/1/22, Callable 7/1/04 @
102................................ 474
1,605 Meade County, PCR, Olin Corp.
Project, 6.00%, 7/1/07, Callable
9/4/98 @ 100....................... 1,618
--------
2,092
--------
Louisiana (2.1%):
900 Calcasieu Parish, Single Family
Mortgage Revenue, Series 92B,
0.00%, 5/1/13, Callable 11/1/02 @
49................................. 331
Continued
38
295
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 1,390 Greater Baton Rouge Parking Authority
Sales & Use Tax, 6.38%, 7/1/03,
Callable 7/1/98 @ 100.............. $ 1,393
2,250 Housing Finance Agency, Series B-2,
AMT, 6.75%, 12/1/28, Callable
6/1/07 @ 102, GNMA................. 2,455
1,895 Housing Finance Agency, Single Family
Mortgage Revenue, 6.65%, 6/1/15,
Callable 12/1/07 @ 104,
GNMA/FNMA.......................... 2,099
795 Iberia Home Mortgage Authority,
Single Family Mortgage Revenue
Refunding, 7.38%, 1/1/11, Callable
1/1/01 @ 100....................... 861
5,000 New Orleans, 0.00%, 9/1/14, AMBAC.... 2,170
72 Public Facilities Authority, Single
Family Mortgage Revenue, 7.50%,
10/1/15, Callable 6/1/05 @ 100..... 77
1,156 Public Facilities Authority, Single
Family Mortgage Revenue, Series C,
8.45%, 12/1/12, Callable 10/1/01 @
101, FHA........................... 1,231
112 St. Mary Public Finance Authority,
Single Family Mortgage Revenue,
Series A, 7.63%, 3/25/12, Callable
10/25/98 @ 100..................... 125
5,745 St. Tammany Public Trust Financing
Authority Revenue, Christwood
Project, 5.70%, 11/15/18, Callable
11/15/08 @ 102..................... 5,706
--------
16,448
--------
Maine (1.0%):
1,750 State Housing Authority, AMT, 6.10%,
11/15/16, Callable 11/15/06 @
102................................ 1,838
810 State Housing Authority, Housing
Finance Revenue, Series I, AMT,
0.00%, 11/1/10, Callable 11/1/06 @
80.2............................... 437
535 State Housing Authority, Housing
Finance Revenue, Series I, AMT,
0.00%, 11/1/11, Callable 11/1/06 @
75.3............................... 269
5,000 State Housing Authority, Mortgage
Revenue, Series D-2, AMT, 5.80%,
11/15/16, Callable 9/1/07 @
101.5.............................. 5,178
--------
7,722
--------
Maryland (0.5%):
1,140 Baltimore County Mortgage Revenue,
Series A, 0.00%, 9/1/24, Callable
9/1/07 @ 40.55..................... 271
1,240 Maryland Community Development,
Multi-Family Housing Revenue,
Series E, AMT, 6.85%, 5/15/25,
Callable 5/15/04 @ 102, GNMA....... 1,334
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Maryland, continued:
$ 8,485 Prince Georges County Housing
Authority Revenue, Foxglenn
Apartments, Series A, AMT, 0.00%,
5/20/22, Callable 5/20/00 @ 28.73,
GNMA............................... $ 2,237
--------
3,842
--------
Massachusetts (1.9%):
3,370 Boston Industrial Development, North
End Community, Series A, 6.45%,
2/1/24, Callable 8/1/07 @ 105,
FHA................................ 3,722
2,185 Dartmouth Housing Development Corp.,
Crossroads Apartments, Series A,
5.45%, 7/1/24, Callable 7/1/03 @
100, MBIA.......................... 2,216
1,020 State Housing Finance Agency, Single
Family Mortgage Revenue, AMT,
7.13%, 6/1/25, Callable 6/1/02 @
102................................ 1,092
1,590 State Industrial Finance Agency
Revenue, University Commons, 6.55%,
8/1/18, Callable 2/1/08 @ 105,
FHA................................ 1,770
3,720 State Industrial Finance Agency
Revenue, University Commons, 6.65%,
8/1/38, Callable 2/1/08 @ 105,
FHA................................ 4,140
2,000 State Industrial Pollution Control,
5.88%, 8/1/08, Callable 8/1/03 @
102................................ 2,083
--------
15,023
--------
Michigan (1.3%):
6,500 Detroit Development, Series A, 5.38%,
5/1/18, Callable 5/1/07 @ 101.5.... 6,596
1,000 Michigan State Building, Series I,
5.10%, 10/1/07, Callable 10/1/03 @
102, AMBAC......................... 1,041
1,640 State Housing Development Authority,
Home Improvement, Series B, AMT,
7.65%, 12/1/12, Callable 12/1/99 @
102, FHA........................... 1,708
505 State Housing Development Authority,
Single Family Mortgage Revenue,
Series A, 7.70%, 12/1/16, Callable
6/1/99 @ 102....................... 518
--------
9,863
--------
Minnesota (0.2%):
2,950 Minneapolis Mortgage Revenue, 0.00%,
10/1/12, Callable 10/1/05 @ 100.... 1,201
--------
Continued
39
296
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Mississippi (1.3%):
$ 1,000 Higher Education Assistance Corp.,
Student Loan Revenue, AMT, 6.60%,
1/1/05, Callable 7/1/02 @ 102...... $ 1,066
1,440 Higher Education Assistance Corp.,
Student Loan Revenue, Series 92C,
AMT, 6.50%, 7/1/04, Callable 7/1/02
@ 102.............................. 1,558
825 Higher Education Assistance Corp.,
Student Loan Revenue, Series C,
AMT, 6.05%, 9/1/07, Callable 9/1/02
@ 102.............................. 868
1,140 Home Corp., Single Family Mortgage
Revenue, AMT, 7.10%, 12/1/10,
Callable 12/1/04 @ 103............. 1,206
1,875 Home Corp., Single Family Mortgage
Revenue, Series B, AMT, 7.90%,
3/1/25, Callable 3/1/05 @ 106,
GNMA............................... 2,098
1,985 Home Corp., Single Family Mortgage
Revenue, Series F, AMT, 7.55%,
12/1/27, Callable 12/1/06 @ 105,
GNMA, FNMA......................... 2,257
1,220 Housing Finance Corp., Single Family
Mortgage Revenue, AMT, 8.25%,
10/15/18, Callable 10/15/99 @ 102,
FGIC............................... 1,281
--------
10,334
--------
Missouri (2.4%):
620 Grandview Industrial Development
Authority, Multi-Family Housing
Revenue, 9.25%, 5/15/08, Callable
5/15/04 @ 103...................... 620
1,000 Jefferson City, Missouri School
District, Series A, 6.70%,
3/1/11............................. 1,198
1,750 Kanasas City Industrial Development
Authority, Multi-Family, 6.25%,
4/1/30, Callable 4/1/08 @ 102...... 1,754
3,080 Kansas City Industrial Development
Authority, Multi-Family, 5.60%,
9/20/23, Callable 3/20/06 @ 101,
GNMA............................... 3,112
1,500 St. Louis County Industrial
Development Authority,
Multi-Family, 5.35%, 7/1/18,
Callable 1/1/08 @ 100, FNMA........ 1,511
1,365 State Housing Development, Common
Mortgage Revenue, Single Family,
AMT, 7.38%, 8/1/23, Callable 2/1/01
@ 102, GNMA........................ 1,442
910 State Housing Development, Common
Mortgage Revenue, Single Family,
AMT, 7.25%, 9/1/26, Callable 3/1/06
@ 105, GNMA........................ 1,023
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Missouri, continued:
$ 1,970 State Housing Development, Common
Mortgage Revenue, Single Family,
Series A, AMT, 7.20%, 9/1/26,
Callable 9/1/06 @ 105, GNMA........ $ 2,219
1,770 State Housing Development, Common
Mortgage Revenue, Single Family,
Series D, AMT, 7.10%, 9/1/27,
Callable 1/1/07 @ 102, GNMA........ 1,935
2,750 State Housing Development,
Multi-Family Mortgage Revenue, AMT,
5.30%, 12/1/18, Callable 6/1/08 @
100, MBIA, FHA..................... 2,758
1,100 State Housing Development, Single
Family Mortgage Revenue, Series
B-2, 6.40%, 3/1/29, Callable 3/1/08
@ 105, GNMA/FNMA................... 1,207
--------
18,779
--------
Montana (1.1%):
1,000 Butte Silver Bow, City and County
Water Revenue, 5.00%, 11/1/13,
Callable 11/1/08 @ 100, FGIC....... 1,002
1,538 Greenwood Plaza Housing, Inc.,
10.43%, 1/1/22, Callable 7/1/98 @
102.5, FHA......................... 1,586
3,000 Lewis & Clark County Metropolitan
Environment, Asarco Inc. Project,
5.60%, 1/1/27, Callable 1/1/08 @
102................................ 3,048
1,000 Montana State University Revenue,
Higher Education, Series E, 5.00%,
11/15/17, Callable 11/15/08 @ 100,
AMBAC.............................. 990
1,650 Montana State University Revenue,
Higher Education, Series E, 5.00%,
11/15/21, Callable 11/15/08 @ 100,
AMBAC.............................. 1,633
--------
8,259
--------
Nebraska (0.1%):
1,245 Finance Authority, Single Family
Mortgage Revenue, 0.00%, 12/15/13,
FHA................................ 269
215 Finance Authority, Single Family
Mortgage Revenue, AMT, 6.35%,
3/15/06, Callable 9/15/02 @ 102.... 225
--------
494
--------
Nevada (2.2%):
1,825 Housing Division, Issue C, AMT,
6.35%, 10/1/13, Callable 4/1/05 @
102, FHA........................... 1,941
1,480 Housing Division, Single Family
Mortgage Revenue, Series C, AMT,
6.60%, 4/1/14, Callable 4/1/06 @
102................................ 1,575
Continued
40
297
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Nevada, continued:
$ 430 Housing Division, Single Family
Program, Series B-1, 6.20%,
10/1/15, Callable 4/1/04 @ 102..... $ 451
1,100 Housing Division, Single Family
Program, Series B-2, AMT, 7.90%,
10/1/21, Callable 4/1/00 @ 102..... 1,148
890 Housing Finance Authority, Single
Family Mortgage Revenue, Series Sub
B-1, AMT, 6.00%, 4/1/10, Callable
4/1/07 @ 102....................... 937
10,000 Washoe County, Water Facilities
Revenue, Sierra Pacific Power, AMT,
6.65%, 6/1/17, Callable 12/1/02 @
102, MBIA.......................... 10,964
--------
17,016
--------
New Hampshire (0.9%):
7,000 Higher Educational & Health
Facilities, 6.13%, 10/1/13,
Callable 10/1/03 @ 102............. 7,281
--------
New Jersey (0.2%):
935 State Housing & Mortgage Finance
Agency Revenue, 7.38%, 10/1/17,
Callable 10/1/99 @ 102, MBIA....... 979
710 State Housing & Mortgage Finance
Agency, Home Mortgage Revenue,
8.38%, 4/1/17, Callable 10/1/99 @
100, MBIA.......................... 735
--------
1,714
--------
New Mexico (1.5%):
165 Bernalillo County, Multi-Family
Housing Revenue, Sub Series A2,
7.00%, 11/1/08, Callable 11/1/03 @
103................................ 169
1,000 Educational Assistance Foundation,
Student Loan Program, AMT, 6.20%,
11/1/08, Callable 11/01/06 @ 102... 1,098
600 Educational Assistance Foundation,
Student Loan Program, AMT, 6.30%,
11/1/09, Callable 11/1/06 @ 102.... 662
550 Hobbs, Single Family Mortgage Revenue
Refunding, 8.75%, 7/1/11, Callable
11/1/98 @ 100...................... 612
155 Las Cruces, Housing Development
Corp., Multi-Family Mortgage
Revenue, 9.00%, 10/1/03............ 160
1,140 Las Cruces, Housing Development
Corp., Multi-Family Mortgage
Revenue, 6.40%, 10/1/19, Callable
4/1/02 @ 102....................... 1,200
1,000 Mortgage Finance Authority Revenue,
Series G-3, 5.20%, 7/1/17, Callable
7/1/07 @ 102....................... 1,003
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
New Mexico, continued:
$ 380 Mortgage Finance Authority, Single
Family Mortgage Refunding, Series
A-2, 6.85%, 7/1/12, Callable 7/1/02
@ 102.............................. $ 404
1,615 Mortgage Finance Authority, Single
Family Mortgage Refunding, Series
A-2, 6.90%, 7/1/24, Callable 7/1/02
@ 102.............................. 1,714
2,790 Mortgage Finance Authority, Single
Family Mortgage Revenue, Series
A-2, AMT, 6.00%, 1/1/29, Callable
1/1/08 @ 102, FNMA/GNMA/FHLMC...... 2,992
1,000 Mortgage Finance Authority, Single
Family Mortgage Revenue, AMT,
6.05%, 7/1/16, Callable 7/1/07
@102, GNMA......................... 1,053
770 Mortgage Finance Authority, Single
Family Mortgage Revenue, Series 95,
AMT, 6.45%, 7/1/25, Callable 1/1/06
@ 102, GNMA........................ 801
--------
11,868
--------
New York (0.7%):
2,400 New York City, Industrial Development
Agency Revenue, Japan Airlines,
AMT, 6.00%, 11/1/15, Callable
11/1/04 @ 102, FHA................. 2,573
3,000 New York, Series A, 5.25%, 8/1/10,
Callable 8/1/07 @ 101.............. 3,095
--------
5,668
--------
North Carolina (0.4%):
2,155 Eastern Municipal Power Agency
Revenue, Series-A, 6.00%, 1/1/26,
Callable 1/1/99 @ 100.............. 2,155
270 Municipal Power Agency #1, Catawba
Electric Revenue, Prerefunded
Series B, 6.00%, 1/1/20,
Prerefunded 7/1/98 @ 100........... 270
430 Municipal Power Agency #1, Catawba
Electric Revenue, Series B, 6.00%,
1/1/20, Callable 1/1/99 @ 100...... 431
475 Municipal Power Agency, Series B,
6.00%, 1/1/20, Callable 1/1/99 @
100, MBIA.......................... 476
--------
3,332
--------
North Dakota (0.6%):
1,570 State Housing Finance Agency, Housing
Finance Program, Series A, AMT,
6.00%, 7/1/17, Callable 1/1/07 @
102................................ 1,651
Continued
41
298
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
North Dakota, continued:
$ 470 State Housing Finance Agency, Single
Family Mortgage Revenue, Series
95A, AMT, 7.40%, 7/1/15, Callable
1/1/05 @ 102....................... $ 503
1,045 State Housing Finance Agency, Single
Family Mortgage Revenue, Series A,
AMT, 8.38%, 7/1/21, Callable 7/1/99
@ 103, FHA......................... 1,090
1,280 State Municipal Financing Project
Series H, 5.13%, 6/1/17, Callable
6/1/07 @ 100, FSA.................. 1,282
300 Student Loan, Series D, AMT, 6.15%,
7/1/09, Callable 7/1/06 @ 100,
AMBAC.............................. 325
--------
4,851
--------
Ohio (4.6%):
1,000 Akron, Bath, Copley, Hospital
Revenue, 7.00%, 1/1/12, ETM........ 1,183
4,500 Akron, Municipal Baseball Stadium,
0.00%, 12/1/16, Callable 12/1/06 @
102................................ 4,146
75 Capital Corp., Multi-Family Housing
Revenue, 7.45%, 11/1/03, Callable
11/1/98 @ 100, FNMA................ 79
2,000 Cleveland, Waterworks Revenue, Series
E, 6.00%, 1/1/17, Callable 1/1/99 @
100................................ 2,001
1,000 Cuyahoga County Health Care
Facilities Revenue, Benjamin Rose
Institute, 5.50%, 12/1/17, Callable
12/1/08 @ 101...................... 992
1,500 Cuyahoga County Health Care
Facilities Revenue, Benjamin Rose
Institute, 5.50%, 12/1/28, Callable
12/1/08 @ 101...................... 1,467
500 Cuyahoga County Hospital Revenue,
5.00%, 1/1/23, Callable 7/1/08 @
101, AMBAC......................... 487
1,000 Dayton, Special Facilities Revenue,
Emery Air Freight Corp., 6.05%,
10/1/09............................ 1,089
1,120 Dublin City School District Capital
Appreciation, GO, 0.00%, 12/1/11,
FGIC............................... 591
650 East Liverpool, Hospital Authority,
Series 91B, 8.13%, 10/1/11,
Callable 10/1/01 @ 102............. 713
1,600 Forest Hills, Local School District,
GO, 6.25%, 12/1/20, Callable
12/1/06 @ 102, MBIA................ 1,794
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 1,355 Housing Financial Agency, Single
Family Mortgage Revenue, Series D,
7.00%, 9/1/11, GNMA................ $ 1,437
850 Housing Financial Agency, Single
Family Mortgage Revenue, Series D,
7.05%, 9/1/16, Callable 9/1/01 @
102, GNMA.......................... 900
5,250 Mahoning District Water Revenue,
7.75%, 5/15/14, Callable 5/15/04 @
102................................ 5,872
2,000 Montgomery County, Hospital Revenue,
5.60%, 12/1/11, Callable 12/1/07 @
102................................ 2,077
1,000 North Canton City Schools, GO, 0.00%,
12/1/08, FGIC...................... 623
1,000 North Canton City Schools, GO, 0.00%,
12/1/10, FGIC...................... 560
1,885 North Royalton City Schools, GO,
6.63%, 12/1/06..................... 2,179
2,000 Scioto County Marine Terminal,
Norfolk Southern Corp. Project
Revenue, 5.30%, 8/15/13, Callable
5/19/06 @ 102...................... 2,012
2,500 State Educational Loan Revenue,
Series A-1, AMT, 5.55%, 12/1/11,
Callable 6/1/07 @ 102, AMBAC....... 2,626
1,000 Student Loan Funding Corp., Sub
Series A, AMT, 6.10%, 8/1/07,
Callable 8/1/03 @ 100.............. 1,046
650 Washington County, Health Care
Facilities, 6.35%, 10/1/27,
Callable 10/1/03 @ 102............. 666
1,200 Westlake, City School District,
5.90%, 12/1/16, Callable 12/1/06 @
102................................ 1,307
--------
35,847
--------
Oklahoma (2.2%):
1,000 Development Finance Authority, 5.45%,
7/1/10, Callable 7/1/05 @ 101,
FSA................................ 1,056
8,885 Grand River Dam Authority, 5.00%,
6/1/12, Callable 6/1/99 @ 100...... 8,886
390 Grand River Dam Authority Revenue,
5.00%, 6/1/12, Callable 6/1/99 @
100, MBIA.......................... 390
2,730 Housing Finance Agency, Single Family
Mortgage Revenue, AMT, 7.05%,
9/1/26, Callable 9/1/06 @ 105...... 3,045
3,000 Housing Finance Agency, Single Family
Mortgage Revenue, Series B-2, A,
7.63%, 9/1/26, Callable 3/1/06 @
105................................ 3,347
500 Tulsa Metropolitan Water, Series A,
5.50%, 11/1/03..................... 530
--------
17,254
--------
Continued
42
299
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Oregon (0.6%):
$ 720 Eugene, Trojan Nuclear Project
Revenue, 5.90%, 9/1/09, Callable
9/1/98 @ 100....................... $ 721
1,545 Portland, Housing Authority,
Multi-Family Housing Revenue, AMT,
6.13%, 5/1/17, Callable 5/1/00 @
100................................ 1,619
1,240 Portland, Housing Authority, Series
A, 5.60%, 1/1/18, Callable 1/1/08 @
100................................ 1,261
1,055 State Housing & Community Services,
Single Family Mortgage Revenue,
Series 92G, AMT, 6.80%, 7/1/27,
Callable 11/18/02 @ 102............ 1,116
--------
4,717
--------
Pennsylvania (1.4%):
2,000 Harrisburg Capital Appreciation,
Series F, GO, 0.00%, 3/15/11,
AMBAC.............................. 1,092
1,280 Housing Finance Agency, Single Family
Mortgage, AMT, 6.75%, 10/1/08,
Callable 10/1/05 @ 102............. 1,492
4,250 Northumberland County, Commonwealth
Lease Revenue, 0.00%, 10/15/12..... 2,122
2,550 Philadelphia, Gas Works Revenue,
Series A, 6.38%, 7/1/14, Callable
7/1/03 @ 102....................... 2,757
1,380 Pittsburgh, Urban Redevelopment
Authority, Mortgage Revenue, Series
A, AMT, 8.35%, 10/1/14, Callable
4/1/99 @ 102....................... 1,415
705 Pittsburgh, Urban Redevelopment
Authority, Mortgage Revenue, Sidney
Square, Project A, AMT, 6.10%,
9/1/10, Callable 9/1/06 @ 102...... 753
560 Pittsburgh, Urban Redevelopment
Authority, Single Family Mortgage
Revenue, Series C, AMT, 7.88%,
12/1/16, Callable 12/1/98 @ 102,
GNMA............................... 576
1,515 Shaler Area School District, Series
B, 0.00%, 11/15/11................. 796
--------
11,003
--------
Puerto Rico (0.1%):
700 Puerto Rico Commonwealth, 6.00%,
7/1/07, MBIA....................... 784
--------
Rhode Island (0.6%):
2,630 Housing & Mortgage Financial Corp.,
Home Ownership Opportunity, AMT,
6.15%, 4/1/17, Callable 10/1/06 @
102................................ 2,775
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Rhode Island, continued:
$ 500 Housing & Mortgage Financial Corp.,
Home Ownership Opportunity, Series
15-B, 6.00%, 10/1/04, Callable
4/1/04 @ 102, MBIA................. $ 529
1,000 Housing & Mortgage Financial Corp.,
Home Ownership Opportunity, Series
3A, 7.85%, 10/1/16, Callable
10/1/00 @ 102...................... 1,056
515 Housing & Mortgage Financial Corp.,
Home Ownership Opportunity, Series
C-1, AMT, 6.80%, 10/1/23, Callable
10/1/01 @ 102...................... 532
--------
4,892
--------
South Carolina (3.3%):
1,200 Jobs, Economic Development Authority
Revenue, 5.00%, 11/1/18, Callable
5/1/08 @ 101, AMBAC................ 1,177
6,580 Jobs, Economic Development Authority
Revenue, 5.00%, 11/1/23, Callable
5/1/08 @ 101, AMBAC................ 6,373
1,000 Jobs, Economic Development Authority,
Hospital Facilities Revenue, Tuomey
Healthcare Systems, 5.00%, 11/1/18,
Callable 11/1/08 @ 101, AMBAC...... 981
3,000 Piedmont, Municipal Power Agency,
Electric Revenue Refunding, Series
A, 6.60%, 1/1/21, Callable 1/1/99 @
100................................ 3,004
6,975 Piedmont, Municipal Power Agency,
Electric Revenue, Series A, 6.55%,
1/1/16, Callable 1/1/99 @ 100...... 6,984
3,655 Piedmont, Municipal Power Agency,
South Carolina Electric Revenue,
Series A, 5.75%, 1/1/24, Callable
1/1/99 @ 100....................... 3,655
1,000 Resource Authority, Local Government
Program Revenue, Series A, 7.25%,
6/1/20, Callable 6/1/00 @ 102...... 1,066
2,500 State Housing Authority, Single
Family Mortgage, Series B, 7.00%,
7/1/11, Callable 7/1/02 @ 100, FHA,
VA................................. 2,536
--------
25,776
--------
South Dakota (0.2%):
1,370 Housing Development Authority
Revenue, AMT, 5.40%, 5/1/20,
Callable 5/1/08 @ 102.............. 1,376
Continued
43
300
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
South Dakota, continued:
$ 400 Housing Development Authority,
Homeowner Mortgage, Series D-1,
AMT, 6.80%, 5/1/12, Callable 5/1/03
@ 102.............................. $ 429
--------
1,805
--------
Tennessee (1.0%):
910 Bristol, Multi-Family Home Revenue,
Shelby Heights Project, Series 97,
6.10%, 3/1/12, Callable 3/1/07 @
101................................ 960
2,000 Housing Development Agency,
Homeownership Program, AMT, 7.38%,
7/1/23, Callable 7/1/01 @ 102...... 2,111
825 Housing Development Agency,
Homeownership Program, Series P,
7.70%, 7/1/16, Callable 7/1/00 @
103................................ 865
1,205 Housing Development Agency,
Homeownership Program, Series V,
AMT, 7.65%, 7/1/22, Callable 7/1/01
@ 102.............................. 1,276
665 La Follette, Housing Development
Corp., Mortgage Revenue Refunding,
Series A, 6.25%, 1/1/16, Callable
7/1/05 @ 102, MBIA, FHA............ 716
380 La Follette, Housing Development
Corp., Mortgage Revenue Refunding,
Series A, 6.37%, 1/1/20, Callable
7/1/05 @ 102, MBIA, FHA............ 411
1,274 Memphis, Health, Educational &
Housing Revenue Refunding, 7.37%,
1/20/27, Callable 1/20/02 @ 103,
GNMA, FHA.......................... 1,367
--------
7,706
--------
Texas (11.7%):
1,385 Beaumont, Housing Finance Corp.,
Single Family Mortgage Revenue
Refunding, 9.20%, 3/1/12, Callable
9/1/01 @ 103....................... 1,550
1,765 Bexar County, Housing Finance Corp.,
Residual Revenue, GO, 0.00%,
3/1/15, Callable 1/1/99 @ 35.2..... 621
1,895 Castleberry Independent School
District, Public Facilities
Revenue, 5.00%, 8/15/13, Callable
8/15/08 @ 102...................... 1,846
2,430 Castleberry Independent School
District, Public Facilities
Revenue, 5.25%, 8/15/18, Callable
8/15/08 @ 102...................... 2,377
2,500 Central Housing Finance Corp., Single
Family Mortgage Revenue, Series A,
0.00%, 9/1/16, ETM................. 998
1,845 Cleburne Capital Appreciation, GO,
0.00%, 2/15/16, Callable 2/15/08 @
64.29, FSA......................... 709
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Texas, continued:
$ 4,000 Dallas--Fort Worth, Regulation
Airport Revenue, 6.10%, 11/1/07,
Callable 7/1/98 @ 100.............. $ 4,008
3,100 Dallas County, Housing Finance Corp.,
Single Family Mortgage Revenue,
0.00%, 1/1/17, FGIC................ 519
1,000 Dallas County, Improvement &
Refunding, Series A, 6.50%,
8/15/09, Callable 8/15/01 @ 100.... 1,073
550 El Paso, Housing Finance Corp.,
Single Family Mortgage Revenue
Refunding, Series A, AMT, 8.75%,
10/1/11, Callable 10/1/00 @ 100,
FHA................................ 613
440 El Paso, Housing Finance Corp.,
Single Family Mortgage Revenue,
AMT, 8.20%, 3/1/21, Callable 3/1/99
@ 103.............................. 457
3,125 Fort Worth, Housing Finance Corp.,
Home Mortgage Revenue Refunding,
Series A, 8.50%, 10/1/11, Callable
10/1/00 @ 100...................... 3,360
1,305 Galveston, Property Finance
Authority, Single Family Mortgage
Revenue Refunding, Series A, 8.50%,
9/1/11, Callable 9/1/01 @ 103...... 1,411
2,000 Hereford Independent School District,
Public Facilities Revenue, 5.25%,
8/15/18, Callable 8/15/08 @ 102.... 1,974
2,365 Houston, Housing Financial Corp.,
Single Family Mortgage Revenue
Refunding, Series B-2, 0.00%,
6/1/14, Callable 12/1/06 @ 58...... 726
700 Houston, Series D, 5.25%, 3/1/08,
Callable 3/1/03 @ 100.............. 721
2,500 Houston, Single Family Mortgage
Revenue, Series B-1, 8.00%, 6/1/14,
Callable 12/1/06 @ 102............. 2,697
1,000 Katy, Independent School District
Series B, 5.00%, 2/15/07, Callable
8/15/02 @ 102, PSFG................ 1,021
855 Laredo, Housing Finance Corp., Single
Family Mortgage Revenue, AMT,
6.20%, 10/1/19, Callable 4/1/04 @
103, GNMA.......................... 886
1,560 Lewisville Housing Finance,
Multi-Family Mortgage Revenue, AMT,
5.50%, 6/1/17, Callable 12/1/07 @
100, FSA........................... 1,592
Continued
44
301
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Texas, continued:
$ 500 Lewisville Independent School
District, 5.25%, 8/15/06, Callable
8/15/04 @ 100, PSFG................ $ 523
625 Lubbock, Housing Finance Corp.,
Single Family Mortgage Revenue,
8.00%, 12/1/20, Callable 1/1/99 @
100, GNMA.......................... 630
915 Lufkin, Health Facilities Development
Corp., Health Systems Revenue
Refunding, 6.50%, 2/15/06.......... 990
520 Manor, Independent School District,
8.00%, 8/1/05, PSFG................ 633
1,045 Municipal Power Agency, 0.00%,
9/1/08............................. 653
9,000 Nueces County, Port Corpus Christi
Authority, Pollution Control
Revenue, AMT, 6.88%, 4/1/17,
Callable 4/1/02 @ 102.............. 9,819
8,100 Red River Authority, Pollution
Control Revenue, AMT, 6.88%,
4/1/17, Callable 4/1/02 @ 102...... 8,838
8,630 Richardson Independent School
District, Series A, GO, 0.00%,
2/15/06............................ 6,127
4,580 Richardson Independent School
District, Series A, GO, 0.00%,
2/15/07............................ 3,096
5,565 Rockwall Independent School District,
GO, 0.00%, 8/15/13, Callable
8/15/09 @ 81.34, PSFG.............. 2,554
1,565 Rockwall Independent School District,
GO, 0.00%, 8/15/14, Callable
8/15/09 @ 76.87, PSFG.............. 675
7,260 Rockwall Independent School District,
GO, 0.00%, 8/15/15, Callable
8/15/09 @ 72.72, PSFG.............. 2,950
6,060 Rockwall Independent School District,
GO, 0.00%, 8/15/16, Callable
8/15/09 @ 68.73, PSFG.............. 2,320
2,000 Rockwall Independent School District,
GO, 0.00%, 8/15/17, Callable
8/15/09 @ 64.89, PSFG.............. 721
1,000 San Angelo, Independent School
District, 5.50%, 2/15/09, Callable
2/15/06 @ 100, PSFG................ 1,059
1,500 San Antonio, Hotel Occupancy, 5.30%,
8/15/08, Callable 8/15/06 @ 102,
FGIC............................... 1,591
2,000 San Antonio, Hotel Occupancy Revenue,
0.00%, 8/15/17, FGIC............... 749
1,555 Southeast Housing Finance Corp.,
Residual Revenue, Series A, ETM,
0.00%, 11/1/14..................... 617
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Texas, continued:
$ 1,600 Southside Independent School
District, Public Facilities
Revenue, 5.25%, 2/15/18, Callable
2/15/08 @ 100...................... $ 1,577
1,500 State Department of Housing &
Community Affairs, Multi-Family
Housing Revenue, Series A, 6.30%,
1/1/16, Callable 1/1/07 @ 102...... 1,603
510 State Department of Housing &
Community Affairs, Multi-Family
Revenue, Series A, 5.90%, 7/1/06... 527
8,675 State Department of Housing &
Community Affairs, Single Family
Revenue Refunding, Series A, 0.00%,
3/1/15, Callable 9/1/04 @ 49.53.... 2,838
2,985 State Higher Education Coordinating
Board, Student Loan Revenue, AMT,
0.00%, 10/1/25, Callable 10/1/01 @
100................................ 3,145
5,000 State Turnpike Authority, Dallas
Northway Revenue, 5.00%, 1/1/16,
Callable 1/1/06 @ 102, MBIA........ 4,951
525 State Veterans Housing Assistance,
AMT, 6.05%, 12/1/12, Callable
12/1/02 @ 102...................... 539
65 Travis County, Housing Finance Corp.,
Single Family Mortgage Revenue
Refunding, Series A, 6.25%, 4/1/19,
Callable 4/1/99 @ 100, GNMA........ 68
1,140 Winter Garden Housing Finance Corp.,
Single Family Mortgage Revenue,
AMT, 6.20%, 10/1/19, Callable
4/1/99 @ 100, GNMA................. 1,178
--------
90,130
--------
Utah (1.1%):
1,000 Intermountain Power Agency, Utah
Power Supply, Series B, 6.00%,
7/1/16, Callable 7/1/98 @ 100...... 1,005
1,000 State Housing Finance Agency, Single
Family Mortgage, AMT, 5.95%,
7/1/09, Callable 1/1/07 @ 102,
FHA................................ 1,036
1,125 State Housing Finance Agency, Single
Family Mortgage, AMT, 6.25%,
7/1/14, Callable 1/1/07 @ 102,
FHA................................ 1,190
2,240 State Housing Finance Agency, Single
Family Mortgage, Issue A-1, 6.00%,
7/1/14, Callable 1/1/07 @ 102,
FHA................................ 2,354
Continued
45
302
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Utah, continued:
$ 2,750 Tooele County, Hazardous Waste
Disposal Revenue, AMT, 6.75%,
8/1/10, Callable 8/1/05 @ 102...... $ 3,038
--------
8,623
--------
Virginia (0.3%):
1,170 Arlington County, Industrial
Development Authority Revenue,
Whitefield, Series A, 5.50%,
7/1/25, Callable 7/1/00 @ 100,
MBIA, FHA.......................... 1,171
500 State Housing Development, Series H,
5.60%, 11/1/06, Callable 5/1/05 @
102................................ 526
735 Virginia Beach Development Authority,
Multi-Family Housing Revenue, 2nd
Mortgage, Series B, 8.75%, 1/15/09,
Callable 7/15/98 @ 100............. 736
--------
2,433
--------
Washington (2.6%):
3,000 Chelan Public Utilities, Series D,
AMT, 6.35%, 7/1/28, Callable 7/1/07
@ 102, MBIA........................ 3,329
670 King County, Housing Authority Rural
Preservation Project, AMT, 5.60%,
1/1/18, Callable 1/1/08 @ 100...... 668
800 King County, Housing Authority Rural
Preservation Project, AMT, 5.75%,
1/1/28, Callable 1/1/08 @ 100...... 797
1,000 Spokane Housing Authority Revenue,
Valley 206 Apartments, Junior Lien
B, 5.75%, 4/1/28, LOC: Washington
Trust Bank......................... 1,001
1,025 Spokane Housing Authority Revenue,
Valley 206 Apartments, Senior Lien
A, 5.40%, 4/1/18, Callable 4/1/08 @
100................................ 1,000
1,300 Spokane Housing Authority Revenue,
Valley 206 Apartments, Senior Lien
A, 5.63%, 4/1/28, Callable 4/1/08 @
100................................ 1,271
3,000 State Housing Community Revenue,
Crista Ministries, Series A, 5.35%,
7/1/14, Callable 7/1/08 @ 100, LOC:
U.S. Bank.......................... 3,007
1,000 State Housing Multi-Family Mortgage,
5.95%, 7/1/20, Callable 1/1/08 @
103, GNMA.......................... 1,058
2,000 State Housing Multi-Family Mortgage
Revenue, 6.00%, 7/1/30, Callable
1/1/08 @ 103, GNMA................. 2,116
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Washington, continued:
$ 1,950 State Public Power Supply, 0.00%,
7/1/15............................. $ 804
2,750 State Public Power Supply, Nuclear
Project No. 2, Revenue Refunding,
Series B, 5.63%, 7/1/12, Callable
7/1/03 @ 102, FSA.................. 2,890
2,000 Vancouver Housing Authority Revenue,
Pooled Housing, Series A, 5.40%,
3/1/18, Callable 3/1/08 @ 100...... 2,009
--------
19,950
--------
West Virginia (1.8%):
1,000 Charleston Community Parking
Facilities Revenue, 0.00%,
12/1/20............................ 259
1,595 Charleston Community Parking
Facilities Revenue, 0.00%,
12/1/21............................ 387
1,630 Charleston Community Parking
Facilities Revenue, 0.00%,
12/1/22............................ 372
1,665 Charleston Community Parking
Facilities Revenue, 0.00%,
12/1/23............................ 356
3,175 Charleston Community Parking
Facilities, Sub-C, 0.00%,
12/1/26............................ 565
8,370 Kanawha-Putnam County, Single Family
Mortgage, Series A, ETM, 0.00%,
12/1/16, AMBAC..................... 3,298
2,600 Monongalia County, Series A, 6.00%,
11/15/27, Callable 11/15/02 @
102................................ 2,617
1,475 State Housing Development Fund,
Housing Finance, AMT, 7.20%,
11/1/20, Callable 5/1/02 @ 102,
FHA................................ 1,591
2,785 Various Forty Four Municipalities,
Single Family Mortgage, Series A,
5.20%, 8/1/17, Callable 8/1/07 @
102................................ 2,830
10,800 Various Forty Four Municipalities,
Single Family Mortgage, Series B,
0.00%, 8/1/30, Callable 8/1/07 @
26.78.............................. 1,766
--------
14,041
--------
Wisconsin (0.7%):
690 Housing & Economic Development, Home
Ownership Revenue, AMT, 8.00%,
3/1/21, Callable 9/1/00 @ 102,
FHA................................ 707
3,000 State Health & Educational Facilities
Revenue, Community Memorial
Hospital, 6.00%, 4/1/18, Callable
4/1/02 @ 102....................... 3,155
Continued
46
303
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Wisconsin, continued:
$ 440 State, Series A, 7.50%, 1/1/15,
Callable 1/1/00 @ 100.............. $ 446
1,000 State, Series A, AMT, 7.50%, 1/1/21,
Callable 7/1/00 @ 100.............. 1,051
--------
5,359
--------
Wyoming (0.3%):
1,550 Community Development Authority
Revenue, Series 4, AMT, 5.70%,
6/1/17, Callable 8/1/07 @ 102...... 1,599
500 Community Development Authority,
Series E, 5.70%, 6/1/13, Callable
12/1/03 @ 102, FHA................. 512
370 Community Development Authority,
Single Family Mortgage, Series A,
6.88%, 6/1/14, Callable 6/1/01 @
102, FHA........................... 381
135 Community Development Authority,
Single Family Mortgage, Series E,
AMT, 7.75%, 6/1/09, Callable
11/30/98 @ 100.9................... 140
--------
2,632
--------
Total Municipal Bonds 765,553
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MONTHLY DEMAND NOTES (2.9%):
California (1.0%):
$ 8,000 Student Educational Loan Marketing,
Corporate Revenue, Series IV-C-1,
AMT, 4.00%, 1/1/33................. $ 8,000
--------
Florida (1.5%):
11,700 Educational Loan Marketing Corp.,
Series A, 3.97%, 12/1/18........... 11,700
--------
New York (0.4%):
3,065 State Job Development Authority
Revenue, Series A-1-A-42, AMT,
4.00%, 3/1/05...................... 3,065
--------
Total Monthly Demand Notes 22,765
--------
Total (Cost $764,609) (a) $788,318
========
- ------------
Percentages indicated are based on net assets of $778,817.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting in excess of federal income tax reporting of
approximately $67. Cost for federal income tax purposes differ from value by
net unrealized appreciation of securities as follows (amounts in thousands):
Unrealized appreciation..................................... $24,195
Unrealized depreciation..................................... (553)
-------
Net unrealized appreciation................................. $23,642
=======
* Variable rate securities having liquidity sources through bank letters of
credit or other cards and/or liquidity agreements. The interest rate, which
will change periodically, is based upon bank prime rates or an index of
market rates. The rate reflected on the Schedule of Portfolio Investments is
the rate in effect at June 30, 1998.
Continued
47
304
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Municipal Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
ACA Insured by American Capital Access
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax Paper
BIG Insured by Bond Insurance Guarantee
ETM Escrowed to Maturity
FGIC Insured by Federal Guarantee Insurance Corp.
FHA Insured by Federal Housing Administration
FNMA Insured by Federal National Mortgage Association
FSA Insured by Federal Security Assurance
GNMA Insured by Government National Mortgage Association
GO General Obligation
GSL Guaranteed Student Loan
MBIA Insured by Municipal Bond Insurance Association
PCR Pollution Control Revenue
PSFG Permanent School Fund Guarantee
VA Veterans Administration
See notes to financial statements.
48
305
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS (99.5%):
Arizona (0.9%):
$1,850 Maricopa County, Industrial
Development, Single Family
Mortgage Revenue, 0.00%, 12/31/14,
ETM............................... $ 816
1,000 Tucson & Pima County, Single Family
Mortgage Revenue, 0.00%, 12/1/14,
ETM............................... 443
--------
1,259
--------
California (0.4%):
1,500 San Marcos, Public Facilities,
Revenue, 0.00%, 9/1/19, ETM....... 517
--------
Colorado (0.6%):
2,000 El Paso County, Single Family
Mortgage Revenue, 0.00%, 9/1/15,
ETM............................... 847
--------
Kansas (1.9%):
1,600 Kansas City, Single Family Mortgage
Revenue, Series 1983 A, 0.00%,
12/1/14, ETM...................... 709
3,225 Labette County, Single Family
Mortgage Revenue, 0.00%, 12/1/14,
ETM............................... 1,429
1,000 Saline County, Single Family
Mortgage Revenue, Series 1983 A,
0.00%, 12/1/15, ETM............... 418
--------
2,556
--------
Kentucky (93.8%):
225 Ashland Utility Revenue, 6.65%,
4/1/04............................ 231
1,500 Berea College Utility Revenue, AMT,
5.90%, 6/1/17, Callable 6/1/07 @
102............................... 1,605
200 Boone County, Certificates of
Participation, Public Golf, 6.35%,
11/15/02.......................... 218
200 Boone County, Certificates of
Participation, Public Golf, 6.40%,
11/15/03, Callable 11/15/02 @
102............................... 221
250 Boone County, School District
Finance Corp., School Building
Revenue, 6.70%, 9/1/06,
Prerefunded 9/1/01 @ 103.......... 276
310 Boone County, School District
Finance Corp., School Building
Revenue, 7.10%, 8/1/07,
Prerefunded 8/1/00 @ 103.......... 338
1,000 Boone County, School District
Finance Corp., School Building
Revenue, 6.70%, 9/1/07,
Prerefunded 9/1/01 @ 103.......... 1,105
395 Boone County, School District
Finance Corp., School Building
Revenue, 7.10%, 8/1/08,
Prerefunded 8/1/00 @ 103.......... 430
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 230 Bowling Green, Key Municipal
Projects Corp., Lease Revenue,
7.20%, 10/1/01, Prerefunded 4/1/99
@ 102............................. $ 240
280 Bowling Green, Key Municipal
Projects Corp., Lease Revenue,
7.40%, 10/1/04, Prerefunded 4/1/99
@ 102............................. 293
1,000 Bowling Green-Warren County,
Hospital Facilities Revenue,
5.00%, 4/1/17, Callable 4/1/08 @
101, FSA.......................... 983
280 Campbell & Kenton Counties,
Sanitation District #1, Sanitation
District Revenue, 6.38%, 8/1/03,
Callable 8/1/98 @ 102, ETM........ 295
580 Campbell & Kenton Counties,
Sanitation District #1, Sanitation
District Revenue, 7.13%, 8/1/05,
Callable 8/2/98 @ 102, ETM........ 636
415 Clinton County, School District
Finance Corp., School Building
Revenue, 6.10%, 6/1/09, Callable
6/1/02
@ 102............................. 449
445 Clinton County, School District
Finance Corp., School Building
Revenue, 6.10%, 6/1/10, Callable
6/1/02
@ 102............................. 482
325 Clinton County, School District
Finance Corp., School Building
Revenue, 6.10%, 6/1/11, Callable
6/1/02
@ 102............................. 352
510 Clinton County, School District
Finance Corp., School Building
Revenue, 6.10%, 6/1/12, Callable
6/1/02
@ 102............................. 551
345 Danville, Hospital Revenue, Esphraim
McDowell Region, 6.40%, 4/1/00,
FGIC.............................. 359
100 Danville, Multi-City Lease Revenue,
Metro Sewer District, 6.35%,
2/1/02, Prerefunded 2/1/01 @ 102,
MBIA.............................. 108
225 Danville, Multi-City Lease Revenue,
Metro Sewer District, 6.50%,
2/1/04, Prerefunded 2/1/01 @ 102,
MBIA.............................. 243
500 Daviess County, Hospital Revenue,
Owensboro-Daviess County, 6.00%,
8/1/04, Callable 8/1/02
@ 102, MBIA....................... 539
Continued
49
306
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$4,500 Development Finance Authority,
Hospital Revenue, Elizabeth,
Med-A, 6.00%, 11/1/10, Callable
11/1/01 @ 100, FGIC............... $ 4,746
250 Eastern Kentucky University,
Revenues Construction, Educational
Buildings, Series 0, 6.70%,
5/1/07, Prerefunded 5/1/01 @ 102,
AMBAC............................. 273
655 Fayette County, School District
Finance Corp., School Building
Revenue, 6.00%, 5/1/02, Callable
5/1/00 @ 102...................... 690
1,000 Fayette County, School District
Finance Corp., School Building
Revenue, 5.38%, 1/1/17, Callable
1/1/07 @ 102...................... 1,030
1,255 Fayette County, School District
Finance Corp., School Building
Revenue, Series A, 5.35%, 1/1/13,
Callable 1/1/07 @ 102............. 1,303
200 Hardin County, Water District #1,
Waterworks Revenue, 6.70%, 9/1/05,
Callable 3/1/01 @ 102............. 217
155 Henderson Electric Light & Power
Revenue, 5.70%, 3/1/03, Callable
8/6/98 @ 100...................... 155
1,025 Higher Education Student Loan Corp.,
Insured Student Loan Revenue,
Series C, 6.50%, 6/1/02, GSL...... 1,107
1,500 Higher Education Student Loan Corp.,
Insured Student Loan Revenue,
Series C, AMT, 5.45%, 6/1/03,
GSL............................... 1,571
1,705 Higher Education Student Loan Corp.,
Insured Student Loan Revenue,
Series D, AMT, 7.00%, 12/1/06,
Callable 12/1/01 @ 102, GSL....... 1,865
500 Housing Corp. Revenue, Series A,
5.40%, 1/1/05, Callable 7/1/03 @
102, FHA, VA...................... 529
500 Housing Corp. Revenue, Series A,
5.50%, 1/1/06, Callable 7/1/03 @
102, FHA, VA...................... 529
500 Housing Corp. Revenue, Series A,
5.60%, 1/1/07, Callable 7/1/03 @
102, FHA, VA...................... 527
760 Housing Corp. Revenue, Series A,
7.40%, 1/1/10, Callable 7/1/00 @
102, FHA, VA...................... 807
400 Housing Corp. Revenue, Series B,
5.85%, 7/1/00, FHA, VA............ 412
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 275 Housing Corp. Revenue, Series B,
6.20%, 7/1/03, Callable 7/1/02 @
102, FHA, VA...................... $ 291
1,745 Housing Corp. Revenue, Series D,
5.80%, 7/1/13, Callable 7/1/06 @
102............................... 1,857
30 Infrastructure Authority Revenue,
Government Agencies Program
Revenue, 6.00%, 8/1/11,
Prerefunded 8/1/01 @ 100.......... 32
80 Infrastructure Authority Revenue,
Government Agencies Program
Revenue, 6.00%, 8/19/11, Callable
8/1/01 @ 100...................... 83
410 Infrastructure Authority Revenue,
Governmental Agencies Program
Revenue, 5.25%, 8/1/04, Callable
8/1/03 @ 102...................... 430
500 Infrastructure Authority Revenue,
Governmental Agencies Program
Revenue, 5.40%, 8/1/06, Callable
8/1/03 @ 102...................... 529
500 Infrastructure Authority Revenue,
Governmental Agencies Program
Revenue, 5.75%, 8/1/13, Callable
8/1/03 @ 102...................... 533
1,000 Infrastructure Authority Revenue,
Revolving Fund Program, Series E,
6.40%, 6/1/04, Callable 6/1/01
@ 102............................. 1,078
710 Infrastructure Authority Revenue,
Revolving Fund Program, Series E,
6.50%, 6/1/05, Callable 6/1/01
@ 102............................. 768
250 Infrastructure Authority Revenue,
Revolving Fund Program, Series G,
6.10%, 6/1/02..................... 268
250 Interlocal School Transportation
Assoc., Equipment Lease Revenue,
6.00%, 3/1/01..................... 262
405 Interlocal School Transportation
Assoc., Equipment Lease Revenue,
6.00%, 3/1/02..................... 430
135 Jefferson County, Capital Projects,
7.70%, 6/1/01, Callable 12/1/98
@ 101, ETM........................ 148
500 Jefferson County, Capital Projects,
First Mortgage Revenue, 6.38%,
12/1/07, Callable 12/1/98 @ 101,
ETM............................... 561
Continued
50
307
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 725 Jefferson County, Capital Projects,
Revenue, Series A, 6.10%, 8/15/07,
Callable 2/15/03 @ 102............ $ 789
1,000 Jefferson County, Capital Projects,
Revenue, Series A, 5.50%, 4/1/10,
Callable 4/1/06 @ 102, AMBAC...... 1,066
1,000 Jefferson County, Capital Projects,
Revenue, Series A, 5.50%, 4/1/11,
Callable 4/1/06 @ 102, AMBAC...... 1,060
1,500 Jefferson County, Health Facilities
Revenue, Alliant Hospital, 5.00%,
10/1/13, Callable 10/1/07 @ 101,
MBIA.............................. 1,499
500 Jefferson County, Health Facilities
Revenue, Jewish Hospital
Healthcare Services, Inc., 6.05%,
5/1/02, AMBAC..................... 534
1,000 Jefferson County, Health Facilities
Revenue, Jewish Hospital
Healthcare Services, Inc., 6.10%,
5/1/03, Callable 5/1/02 @ 102,
AMBAC............................. 1,083
300 Jefferson County, Health Facilities
Revenue, Jewish Hospital
Healthcare Services, Inc., 6.20%,
5/1/04, Callable 5/1/02 @ 102,
AMBAC............................. 326
500 Jefferson County, Health Facilities
Revenue, Jewish Hospital
Healthcare Services, Inc., 6.38%,
5/1/08, Callable 5/1/02 @ 102,
AMBAC............................. 547
930 Jefferson County, Health Facilities
Revenue, Jewish Hospital
Healthcare Services, Inc., 5.65%,
1/1/10, Callable 1/1/07 @ 102..... 995
1,500 Jefferson County, Health Facilities
Revenue, University Medical
Center, 5.50%, 7/1/17, Callable
7/1/07 @ 101, MBIA................ 1,564
2,000 Jefferson County, Hospital Revenue,
Alliant Hospital Systems, 6.20%,
10/1/04, Callable 10/1/02 @ 102,
MBIA.............................. 2,189
550 Jefferson County, Pollution Control
Revenue, Louisville Gas & Electric
Co., 7.45%, 6/15/15, Callable
6/15/00 @ 102..................... 594
1,000 Jefferson County, School District
Finance Corp., School Building
Revenue, 6.00%, 1/1/04, Callable
7/1/02 @ 102, MBIA................ 1,083
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 625 Jefferson County, School District
Finance Corp., School Building
Revenue, 7.15%, 9/1/04,
Prerefunded 9/1/00 @ 103.......... $ 684
675 Jefferson County, School District
Finance Corp., School Building
Revenue, 7.20%, 9/1/05,
Prerefunded 9/1/00 @ 103.......... 740
1,430 Jefferson County, School District
Finance Corp., School Building
Revenue, 5.25%, 7/1/07, Callable
7/1/05 @ 102, MBIA................ 1,515
2,315 Junction City, College Revenue,
Centre College Project, 5.70%,
4/1/12, Callable 4/1/07 @ 102..... 2,501
500 Kenton County, Airport Revenue,
International, Series AR-A, AMT,
6.10%, 3/1/04, Callable 3/1/02 @
101, FSA.......................... 534
1,000 Kenton County, Airport Revenue,
International, Series AR-A, AMT,
6.20%, 3/1/05, Callable 3/1/02 @
101, FSA.......................... 1,069
500 Kenton County, Airport Revenue,
International, Series B, AMT,
5.75%, 3/1/07, Callable 3/1/03 @
102, FSA.......................... 534
500 Kenton County, Airport Revenue,
International, Series B, AMT,
5.75%, 3/1/08, Callable 3/1/03 @
102, FSA.......................... 533
380 Kenton County, Public Properties
Corp. Revenue, Community Health
Care Facilities Project, 7.00%,
10/1/06, Prerefunded 10/1/99 @
102............................... 403
200 Kenton County, School District
Finance Corp., School Building
Revenue, 6.30%, 12/1/00........... 211
100 Kenton County, School District
Finance Corp., School Building
Revenue, 6.50%, 12/1/02,
Prerefunded 12/1/01 @ 102......... 110
325 Kenton County, School District
Finance Corp., School Building
Revenue, 5.25%, 7/1/07, Callable
7/1/03 @ 102...................... 341
495 Kenton County, Water District,
Waterworks Revenue, District #001,
6.30%, 2/1/02, FGIC............... 531
Continued
51
308
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$1,015 Kenton County, Water District,
Waterworks Revenue, District #001,
6.38%, 2/1/04, Callable 2/1/02 @
103, FGIC......................... $ 1,115
240 Lexington-Fayette Urban County
Government, Economic Development
Revenue, 7.54%, 12/1/03........... 247
300 Lexington-Fayette Urban County
Government, Educational Facilities
Revenue, Transylvania University,
7.15%, 2/1/00, Callable 2/1/99 @
102, MBIA......................... 312
250 Lexington-Fayette Urban County
Government, Educational Facilities
Revenue, Transylvania University,
7.25%, 2/1/02, Callable 2/1/99 @
102, MBIA......................... 260
335 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Capital Projects Mortgage
Revenue, 6.20%, 4/1/05,
Prerefunded 4/1/02 @ 102.......... 365
355 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Capital Projects Mortgage
Revenue, 6.30%, 4/1/06,
Prerefunded 4/1/02 @ 102.......... 388
380 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Capital Projects Mortgage
Revenue, 6.40%, 4/1/07,
Prerefunded 4/1/02 @ 102.......... 417
405 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Capital Projects Mortgage
Revenue, 6.40%, 4/1/08,
Prerefunded 4/1/02 @ 102.......... 445
425 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Capital Projects Mortgage
Revenue, 6.40%, 4/1/09,
Prerefunded 4/1/02 @ 102.......... 466
425 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Greenspace Project Revenue,
6.75%, 12/1/05, Prerefunded
12/1/00 @ 102..................... 461
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 240 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Greenspace Project Revenue,
6.75%, 12/1/07, Prerefunded
12/1/00 @ 102..................... $ 260
350 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Mortgage Revenue, 6.70%,
2/1/02, Prerefunded 2/1/00 @
102............................... 372
210 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Mortgage Revenue, 6.88%,
2/1/06, Prerefunded 2/1/00 @
102............................... 224
430 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Mortgage Revenue, 6.75%,
7/1/07, Prerefunded 7/1/00 @
102............................... 462
500 Lexington-Fayette Urban County
Government, Public Facilities
Corp., Sewer System Revenue,
6.35%, 7/1/07, Callable 7/1/02 @
102, MBIA......................... 548
935 Lexington-Fayette Urban County
Government, Revenue, University of
Kentucky Alumni Assoc., Inc.,
6.50%, 11/1/07, Prerefunded
11/1/04 @ 102, MBIA............... 1,068
1,500 Lexington-Fayette Urban County
Government, Revenue, University of
Kentucky Alumni Assoc., Inc.,
5.00%, 11/1/14, Callable 11/01/08
@ 102, MBIA....................... 1,503
250 Lexington-Fayette Urban County
Government, School Building
Revenue, 6.85%, 6/1/01,
Prerefunded 12/1/99 @ 103......... 268
625 Lexington-Fayette Urban County
Government, School Building
Revenue, 7.00%, 6/1/04,
Prerefunded 12/1/99 @ 103......... 671
1,930 Lexington-Fayette Urban County
Government, Sewer System Revenue,
6.35%, 7/1/09, Callable 7/1/02 @
102, MBIA......................... 2,119
1,420 Louisville & Jefferson County,
Airport Authority Revenue, AMT,
6.00%, 7/1/10, Callable 7/1/07 @
102, MBIA......................... 1,568
Continued
52
309
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 200 Louisville & Jefferson County,
Metropolitan Sewer District, Sewer
Revenue, 6.25%, 6/1/99, Callable
12/1/98 @ 100, ETM................ $ 205
1,375 Louisville & Jefferson County,
Metropolitan Sewer District, Sewer
Revenue, 5.00%, 5/15/13, Callable
5/15/08 @ 101, FGIC............... 1,378
1,000 Louisville & Jefferson County,
Metropolitan Sewer District, Sewer
Revenue, 5.00%, 5/15/14, Callable
5/15/08 @ 101..................... 999
825 Louisville & Jefferson County, Sewer
& Drain System Revenue, 6.40%,
5/15/08, Prerefunded 11/15/04 @
102, AMBAC........................ 938
205 Louisville Parking Authority
Revenue, 6.60%, 12/1/03,
Prerefunded 6/1/01 @ 103.......... 225
300 Louisville Public Properties Corp.
Revenue, 6.00%, 4/1/04, Callable
4/1/99 @ 102...................... 310
300 Louisville Public Properties Corp.
Revenue, 6.00%, 4/1/05, Callable
4/1/99 @ 102...................... 311
295 Louisville Public Properties Corp.,
First Mortgage Revenue, 6.15%,
12/1/05, Prerefunded 12/1/02 @
102............................... 324
200 Louisville Public Properties Corp.,
First Mortgage Revenue, 6.40%,
12/1/07, Prerefunded 12/1/02 @
102............................... 221
1,000 Louisville Water Works Board, Water
System Revenue, Louisville Water
Co., 5.40%, 11/15/04, Callable
11/15/00 @ 102.................... 1,047
500 Louisville Water Works Board, Water
System Revenue, Louisville Water
Co., 5.63%, 11/15/07, Callable
11/15/00 @ 102.................... 528
1,540 Louisville Water Works Board, Water
System Revenue, Louisville Water
Co., 5.75%, 11/15/09, Callable
11/15/00 @ 102.................... 1,629
1,530 Louisville Water Works Board, Water
System Revenue, Louisville Water
Co., 5.75%, 11/15/10, Callable
11/15/00 @ 102.................... 1,618
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$1,000 McCracken County, Hospital Revenue,
Mercy Health System, Series A,
6.20%, 11/1/05, Callable 11/1/04 @
102, MBIA......................... $ 1,117
2,090 McCracken County, Hospital Revenue,
Mercy Health System, Series A,
6.40%, 11/1/07, Callable 11/1/04 @
102, MBIA......................... 2,359
505 McCreary County, School District
Finance Corp., School Building
Revenue, 6.60%, 10/1/08, Callable
10/1/01 @ 103..................... 557
215 Mercer County, School District
Finance Corp., School Building
Revenue, 6.38%, 12/1/07, Callable
12/1/01 @ 102..................... 232
300 Morehead State University, Housing &
Dining System Revenue, Series I,
6.10%, 11/1/05, Callable 11/1/01 @
102, AMBAC........................ 322
200 Morehead State University, Housing &
Dining System Revenue, Series M,
6.30%, 11/1/08, Callable 11/1/01 @
102, AMBAC........................ 217
215 Muhlenberg County, School District
Finance Corp., School Building
Revenue, 5.85%, 8/1/09, Callable
8/1/02 @ 102...................... 231
750 Muhlenberg County, School District
Finance Corp., School Building
Revenue, Second Series, 5.85%,
8/1/10, Callable 8/1/02 @ 102..... 805
240 Murray State University Revenues,
Series G, Second Series, 5.60%,
5/1/06, Callable 5/1/03 @ 102..... 256
460 Murray State University Revenues,
Series G, Second Series, 5.60%,
5/1/07, Callable 5/1/03 @ 102..... 489
530 Northern Kentucky University,
Educational Buildings Revenue,
6.10%, 5/1/06, Callable 5/1/02 @
102, AMBAC........................ 575
300 Owensboro, Electric Light & Power
Revenue, 6.75%, 1/1/03, Callable
1/1/99 @ 100, ETM................. 318
205 Paducah Electric Plant Board
Revenue, 6.30%, 1/1/08, Callable
1/1/01 @ 102, AMBAC............... 220
300 Paducah Waterworks Revenue, 6.10%,
7/1/00, MBIA...................... 313
Continued
53
310
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 300 Paducah Waterworks Revenue, 6.60%,
7/1/05, Prerefunded 7/1/01 @ 102,
MBIA.............................. $ 327
1,085 Perry County, School District
Finance Corp., School Building
Revenue, 6.25%, 7/1/09, Callable
7/1/02 @ 100...................... 1,169
355 Richmond Water, Gas & Sewer Revenue,
5.00%, 7/1/14, Callable 7/1/08 @
102, MBIA......................... 356
330 Scott County, School District
Finance Corp., School Building
Revenue, 7.10%, 12/1/02,
Prerefunded 12/1/98 @ 103......... 345
545 Shelby County, School District
Finance Corp., School Building
Revenue, 6.10%, 9/1/02, Callable
9/1/01 @ 103...................... 585
100 Shelby County, School District
Finance Corp., School Building
Revenue, 6.25%, 9/1/03, Callable
9/1/01 @ 103...................... 108
500 Shelby County, School District
Finance Corp., School Building
Revenue, 6.50%, 9/1/05, Callable
9/1/01 @ 103...................... 549
200 Shelby County, School District
Finance Corp., School Building
Revenue, 6.50%, 9/1/07, Callable
9/1/01 @ 103...................... 219
1,000 State Economic Development Finance
Authority, Hospital Revenue,
Appalachian Regulatory Hospital,
5.50%, 10/1/07.................... 1,034
1,000 State Economic Development Finance
Authority, Hospital Revenue,
Catholic Health Initiatives
Hospital, 5.38%, 12/1/11, Callable
6/1/08 @ 101...................... 1,047
1,245 State Economic Development Finance
Authority, Hospital Revenue,
Southern Central Nursing Homes,
6.00%, 7/1/27, Callable 1/1/08 @
105, FHA, MBIA.................... 1,335
1,000 State Property & Buildings
Commission Revenues, Project #26,
7.40%, 6/1/00, Callable 12/1/98 @
102............................... 1,034
2,300 State Property & Buildings
Commission Revenues, Project #50,
6.00%, 2/1/10, Prerefunded 2/1/01
@ 100............................. 2,414
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$1,475 State Property & Buildings
Commission Revenues, Project #53,
6.25%, 10/1/02, Callable 10/1/01
@102.............................. $ 1,594
1,000 State Property & Buildings
Commission Revenues, Project #54,
5.90%, 9/1/07, Callable 9/1/02 @
102............................... 1,071
1,000 State Property & Buildings
Commission Revenues, Project #56,
5.70%, 9/1/06, Callable 9/1/04 @
102............................... 1,083
1,000 State Property & Buildings
Commission Revenues, Project #56,
5.80%, 9/1/07, Callable 9/1/04 @
102............................... 1,085
1,000 State Property & Buildings
Commission Revenues, Project #59,
5.30%, 5/1/07, Callable 11/1/05 @
102............................... 1,059
1,000 State Property & Buildings
Commission Revenues, Project #59,
5.38%, 11/1/09, Callable 11/1/05 @
102............................... 1,056
275 State Property & Buildings
Commission Revenues, Toyota Corp.,
6.40%, 11/1/01.................... 295
235 State Turnpike Authority, Economic
Development, Recovery Road
Revenue, 6.13%, 7/1/07, Callable
8/6/98 @ 100, ETM................. 253
500 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 7.13%,
5/15/01, Prerefunded 5/15/00
@101.5............................ 536
750 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 5.70%,
1/1/03............................ 795
1,000 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 5.20%,
7/1/03, AMBAC..................... 1,045
1,000 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 5.40%,
7/1/05, AMBAC..................... 1,064
1,000 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 7.38%,
5/15/07, Prerefunded 5/15/00 @
101.5............................. 1,077
1,000 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 6.50%,
7/1/08, AMBAC..................... 1,164
Continued
54
311
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$2,750 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 5.50%,
7/1/08, AMBAC..................... $ 2,978
1,000 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 5.50%,
7/1/09, AMBAC..................... 1,086
1,000 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 0.00%,
1/1/10, FGIC...................... 588
2,600 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 5.63%,
7/1/10, Callable 7/1/05 @ 102,
AMBAC............................. 2,796
500 State Turnpike Authority, Economic
Development, Road Revenue,
Revitalization Project, 5.75%,
7/1/11, Callable 7/1/05 @ 102,
AMBAC............................. 541
500 State Turnpike Authority, Resource
Recovery Revenue, 6.63%, 7/1/08,
Callable 7/1/98 @ 100, ETM........ 553
1,000 State Turnpike Authority, Resource
Recovery Revenue, 1985 Series A,
6.00%, 7/1/09, Callable 8/6/98
@ 100............................. 1,002
215 State Turnpike Authority, Toll Road
Revenue Refunding, 6.13%, 7/1/08,
Callable 7/1/98 @ 100, ETM........ 231
1,000 University of Kentucky Revenues,
Community Colleges, Educational
Buildings Revenue, 6.60%,
5/1/01............................ 1,067
535 University of Kentucky Revenues,
Community Colleges, Educational
Buildings Revenue, 6.30%, 5/1/02,
Callable 11/1/01 @ 102............ 575
475 University of Kentucky Revenues,
Community Colleges, Educational
Buildings Revenue, Southeast,
6.30%, 5/1/05, Callable 11/1/01 @
102............................... 516
1,000 University of Louisville Revenues,
Construction of Educational
Buildings, Series I, 5.38%,
5/1/06, Callable 5/1/03 @ 102..... 1,058
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------ --------
MUNICIPAL BONDS, CONTINUED:
Kentucky, continued:
$ 500 University of Louisville Revenues,
Construction of Educational
Buildings, Series I, 5.40%,
5/1/07, Callable 5/1/03 @ 102..... $ 528
500 University of Louisville Revenues,
Construction of Educational
Buildings, Series I, 5.40%,
5/1/08, Callable 5/1/03 @ 102..... 526
500 University of Louisville Revenues,
Construction of Educational
Buildings, Series I, 5.40%,
5/1/09, Callable 5/1/03 @ 102..... 524
330 Versailles County, Water & Sewer,
6.30%, 12/1/09, Callable 12/1/01 @
103............................... 360
305 Warren County, Water District
Revenue, 7.13%, 1/1/03,
Prerefunded 7/1/99 @ 103, MBIA.... 324
950 Winchester Utilities Revenue, 5.30%,
7/1/09, Callable 7/1/03 @ 102..... 991
--------
127,246
--------
Louisiana (1.0%):
3,000 Public Facilities Authority Revenue,
Multi-Family, Series A, 0.00%,
2/1/20, ETM....................... 997
1,000 Public Facilities Authority Revenue,
Series B, 0.00%, 12/1/19, ETM..... 335
--------
1,332
--------
Mississippi (0.6%):
2,500 Home Corp., Single Family Mortgage
Revenue, 0.00%, 9/15/16, Callable
3/15/04 @ 41.7, ETM............... 822
--------
Texas (0.3%):
1,000 Central Housing Finance Corp.,
Single Family Mortgage Revenue,
Series A, 0.00%, 9/1/16, ETM,
VA................................ 399
--------
Total Municipal Bonds 134,978
--------
INVESTMENT COMPANIES (0.5%):
723 The One Group Municipal Money Market
Fund, Fiduciary Class............. 723
--------
Total Investment Companies 723
--------
Total (Cost $127,271) (a) $135,701
========
Continued
55
312
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Kentucky Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
- ------------
Percentages indicated are based on net assets of $135,700.
(a) Represents cost for financial reporting and federal income tax purposes and
differs from value by net unrealized appreciation of securities as follows
(amounts in thousands):
Unrealized appreciation..................................... $8,430
Unrealized depreciation..................................... --
------
Net unrealized appreciation................................. $8,430
======
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax Paper
ETM Escrowed to Maturity
FGIC Insured by Federal Guarantee Insurance Corp.
FHA Insured by Federal Housing Administration
FNMA Insured by Federal National Mortgage Association
FSA Insured by Federal Security Assurance
GSL Guaranteed Student Loans
MBIA Insured by Municipal Bond Insurance Association
VA Veterans Administration
See notes to financial statements.
Continued
56
313
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS (99.4%):
Colorado (1.2%):
$ 2,810 El Paso County, Single Family
Mortgage Revenue, Series A,
0.00%, 5/1/15, ETM............. $ 1,210
2,350 Housing Finance Authority, Single
Family Mortgage Revenue, 0.00%,
9/1/14, ETM.................... 1,054
--------
2,264
--------
Kansas (0.5%):
1,000 Kansas City, Single Family
Mortgage Revenue, Series 1983
A, 0.00%, 12/1/14, ETM......... 443
1,390 Saline County, Single Family
Mortgage Revenue, Series 1983
A, 0.00%, 12/1/15, ETM......... 581
--------
1,024
--------
Louisiana (1.1%):
3,260 Jefferson, Sales Tax Revenue,
0.00%, 12/1/11, FSA............ 1,700
1,380 New Orleans, GO, 0.00%, 9/1/17,
AMBAC.......................... 501
--------
2,201
--------
Massachusetts (0.6%):
360 State GO, Series C, 6.75%,
8/1/09, Callable 8/1/01 @ 102,
AMBAC.......................... 394
640 State GO, Series C, 6.75%,
8/1/09, Prerefunded 8/1/01 @
102, AMBAC..................... 702
--------
1,096
--------
Mississippi (0.5%):
3,000 Home Corp., Single Family
Mortgage Revenue, 0.00%,
9/15/16, Callable 3/15/04 @
41.7, ETM...................... 987
--------
Missouri (0.6%):
1,000 State Health, Series AA, 6.40%,
6/1/10, MBIA................... 1,165
--------
Ohio (93.8%):
1,000 Adams County, GO, School
District, 5.45%, 12/1/08,
Callable 12/1/05 @ 102, MBIA... 1,076
1,045 Akron Sewer Systems, Sewer
Revenue, 5.30%, 12/1/05,
MBIA........................... 1,110
1,000 Akron Sewer Systems, Sewer
Revenue, 5.65%, 12/1/08,
Callable 12/1/06 @ 101, MBIA... 1,090
1,030 Akron Sewer Systems, Sewer
Revenue, 5.38%, 12/1/13,
FGIC........................... 1,084
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 1,000 Akron, Bath, Copley Ohio Hospital
Revenue, 7.45%, 11/15/20,
Prerefunded 11/15/00 @ 102,
AMBAC.......................... $ 1,097
1,000 Allen County, Justice Center, GO,
7.00%, 12/1/15, Prerefunded
12/1/01 @ 101, AMBAC........... 1,104
1,280 Belmont County, Health System
Revenue, Ohio Regional
Hospital, 5.25%, 1/1/08........ 1,321
3,000 Bexley School District, GO,
6.50%, 12/1/16, Prerefunded
12/1/01 @ 102.................. 3,288
1,000 Big Walnut School District, GO,
7.30%, 6/1/15, Prerefunded
6/1/01 @ 102, AMBAC............ 1,108
250 Big Walnut School District, GO,
5.10%, 12/1/15, Callable
12/1/07 @ 101, AMBAC........... 251
725 Bowling Green State University,
5.65%, 6/1/11, Callable 6/1/06
@ 101, AMBAC................... 778
1,000 Butler County, Hospital
Facilities Revenue, 6.75%,
11/15/10, Callable 11/15/01 @
102, FGIC...................... 1,096
750 Cincinnati, GO, 6.75%, 12/1/00... 799
2,775 Clermont County Waterworks, Water
Revenue, 6.63%, 12/1/15,
Prerefunded 12/1/01 @102,
AMBAC.......................... 3,055
1,000 Cleveland Airport Systems
Revenue, Series A, AMT, 5.13%,
1/1/13, Callable 1/1/08 @ 101,
FSA............................ 1,001
4,500 Cleveland Public Power System,
Power Revenue, 6.40%, 11/15/06,
Callable 11/15/04 @ 102,
MBIA........................... 5,070
3,000 Cleveland Public Power System,
Power Revenue, 0.00%, 11/15/11,
MBIA........................... 1,587
1,000 Cleveland Stadium Project, 5.25%,
11/15/12, Callable 11/15/07 @
102, AMBAC..................... 1,032
1,850 Cleveland Waterworks, Water
Revenue, Series F-92B, 6.25%,
1/1/06, Callable 1/1/02 @ 102,
AMBAC.......................... 2,007
50 Cleveland Waterworks, Water
Revenue, Series F-92B, 6.50%,
1/1/11, Prerefunded 1/1/02 @
102, AMBAC..................... 55
Continued
57
314
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 3,750 Cleveland Waterworks, Water
Revenue, Series F-92B, 6.50%,
1/1/11, Callable 1/1/02 @ 102,
AMBAC.......................... $ 4,075
2,000 Cleveland Waterworks, Water
Revenue, Series G, 5.50%,
1/1/13, MBIA................... 2,152
500 Cleveland, GO, 7.50%, 8/1/07,
Prerefunded 2/1/03 @ 100,
AMBAC.......................... 569
1,000 Cleveland, GO, 6.88%, 7/1/09,
Prerefunded 7/1/99 @ 102,
MBIA........................... 1,051
1,000 Cleveland, GO, 6.38%, 7/1/12,
Prerefunded 7/1/02 @ 102,
MBIA........................... 1,101
1,225 Columbus Municipal Airport No.
30-E-U, GO, 6.20%, 4/15/04,
Callable 4/15/01 @ 100......... 1,296
1,000 Columbus Sewer Improvements, GO,
6.75%, 9/15/06, Callable
9/15/01 @ 100.................. 1,091
2,285 Columbus Waterworks Enlargement
No. 44, GO, 6.00%, 5/1/11,
Prerefunded 5/1/03 @ 102....... 2,507
1,000 Columbus Waterworks Enlargement
No. 44, GO, 6.00%, 5/1/12,
Prerefunded 5/1/03 @ 102....... 1,097
1,000 Columbus, GO, 6.40%, 1/1/07,
Callable 1/1/02 @ 102.......... 1,089
1,000 Columbus, GO, 5.00%, 06/15/12,
Callable 6/15/08 @ 101......... 1,018
2,000 Columbus, GO, 5.00%, 6/15/16,
Callable 6/15/08 @ 101......... 2,001
1,000 Cuyahoga County, Health Care
Facilities, Benjamin Rose
Institute, 5.50%, 12/1/17,
Callable 12/1/08 @ 101......... 992
1,000 Cuyahoga County, Hospital
Revenue, Metrohealth System,
Series A, 5.13%, 2/15/13,
Callable 2/15/07 @ 102, MBIA... 1,007
1,000 Cuyahoga County, Hospital
Revenue, Series A, 5.50%,
1/15/10, Callable 1/15/06 @
102, MBIA...................... 1,058
1,000 Cuyahoga County, Hospital
Revenue, W.O. Walker Center,
5.25%, 1/1/13, Callable 7/1/08
@ 101, AMBAC................... 1,031
1,000 Cuyahoga County, Jail Facilities,
GO, 7.00%, 10/1/13, Prerefunded
10/1/01 @ 102.................. 1,105
1,500 Dayton Special Facilities
Revenue, Air Freight-E, 6.05%,
10/1/09........................ 1,629
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 1,000 Delaware County, Library
District, GO, 7.25%, 11/1/10,
Prerefunded 11/1/00 @ 102...... $ 1,093
1,000 Delaware County, Sewer, GO,
5.60%, 12/1/10, Callable
12/1/05 @ 101.................. 1,076
2,165 Dublin City School District, GO,
0.00%, 12/1/09, MBIA........... 1,279
2,150 Dublin City School District, GO,
0.00%, 12/1/10, MBIA........... 1,205
1,650 Dublin City School District, GO,
0.00%, 12/1/11, MBIA........... 871
1,185 Dublin City School District, GO,
5.00%, 12/1/12, Callable
12/1/07 @ 101, MBIA............ 1,196
1,000 Fairfield County, Hospital
Improvement Revenue, Lancaster-
Fairfield Community Hospital,
7.10%, 6/15/21, Prerefunded
6/15/01 @ 102, MBIA............ 1,102
1,500 Franklin County, Health Care
Facilities Revenue, 5.50%,
11/1/16, Callable 11/1/02 @
102............................ 1,513
1,000 Franklin County, Health Care
Facilities Revenue, 5.50%,
7/1/17, Callable 7/1/08 @
101............................ 994
1,290 Franklin County, Hospital
Revenue, Children's Hospital,
5.65%, 11/1/08, Callable
11/1/06
@ 101.......................... 1,397
1,065 Franklin County, Hospital
Revenue, Children's Hospital,
5.75%, 11/1/09, Callable
11/1/06
@ 101.......................... 1,154
800 Franklin County, Hospital
Revenue, Children's Hospital,
5.80%, 11/1/10, Callable
11/1/06
@ 101.......................... 865
2,000 Franklin County, Hospital
Revenue, Children's Hospital
Project, Series A, 6.50%,
5/1/07, Callable 11/1/02 @
102............................ 2,213
1,000 Franklin County, Hospital
Revenue, Children's Hospital
Project, Series A, 6.60%,
11/1/11, Callable 11/1/01 @
102............................ 1,096
1,000 Franklin County, Hospital
Revenue, Holy Cross Health,
7.65%, 6/1/10, Prerefunded
6/1/00 @ 102, AMBAC............ 1,087
Continued
58
315
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 1,000 Franklin County, Hospital
Revenue, Riverside United,
Series B, 7.60%, 5/15/20,
Prerefunded 5/15/00 @ 102...... $ 1,085
1,000 Greater Cleveland Regional
Transportation Authority, GO,
5.60%, 12/1/11, Callable
12/1/06 @ 101, FGIC............ 1,070
1,600 Greene County, GO, 6.25%,
12/1/09, Callable 12/1/02 @
102,
AMBAC.......................... 1,759
1,000 Greene County, Water System
Revenue, 6.85%, 12/1/11,
Callable 12/1/01 @ 102,
AMBAC.......................... 1,100
1,500 Hamilton County, Building
Improvement, Museum Center, GO,
6.50%, 12/1/09, Callable
12/1/01 @ 102.................. 1,632
1,500 Hamilton County, Economic
Development, Housing Revenue,
AMT, 5.50%, 1/1/12, Callable
1/1/07 @ 102, FNMA............. 1,547
1,500 Hamilton County, Electric Systems
Revenue, 6.13%, 10/15/08,
Callable 10/15/02 @ 102,
FGIC........................... 1,636
1,500 Hamilton County, Hospital
Facilities Revenue, Bethesda
Hospital, Series A, 6.25%,
1/1/12, Callable 1/1/03 @
102............................ 1,624
1,265 Hamilton County, Hospital
Facilities Revenue, Christ
Hospital, Series B, 6.63%,
1/1/06, Prerefunded 1/1/01 @
100, FGIC...................... 1,343
380 Hamilton County, Sewer System
Revenue, 6.30%, 12/1/01,
Prerefunded 6/1/01 @ 102....... 410
1,000 Hamilton Waterworks, Water
Utility Improvement Revenue,
Series A, 6.40%, 10/15/07,
Callable 10/15/01 @ 102,
MBIA........................... 1,089
1,000 Huron County, Correctional
Facility, Issue I, GO, 5.70%,
12/1/11, Callable 12/1/07 @
102, MBIA...................... 1,094
1,000 Kent State University, General
Receipts Revenue, 6.45%,
5/1/12, Prerefunded 5/1/02 @
102, AMBAC..................... 1,101
1,000 Kent State University, General
Receipts Revenue, Series A,
5.00%, 5/1/14, Callable 5/1/08
@ 101, AMBAC................... 996
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 3,000 Lakewood Sanitation Sewer System,
Special Obligation, 6.40%,
12/1/11, Prerefunded 12/1/01 @
102............................ $ 3,279
1,000 Lakota School District, GO,
0.00%, 12/1/11, FGIC........... 524
570 Liberty Benton School District,
GO, 0.00%, 12/1/11, AMBAC...... 305
570 Liberty Benton School District,
GO, 0.00%, 12/1/12, AMBAC...... 288
1,000 Logan County School District, GO,
7.10%, 12/1/12, Prerefunded
12/1/01 @ 101, AMBAC........... 1,107
1,000 Lorain County, Hospital Revenue,
Catholic Healthcare Partners,
6.00%, 9/1/05, MBIA............ 1,101
1,000 Lorain County, Hospital Revenue,
Catholic Healthcare Partners,
5.63%, 9/1/12, Callable 9/1/07
@ 102, MBIA.................... 1,072
1,000 Marysville School District, GO,
7.20%, 12/1/10, Prerefunded
12/1/00 @ 102, AMBAC........... 1,094
1,000 Miami County, GO, 5.25%, 12/1/17,
Callable 12/1/7 @ 102.......... 1,017
2,500 Middleburg Heights Hospital,
5.70%, 8/15/10, Callable
8/15/08 @ 102, FSA............. 2,736
1,000 Montgomery County Hospital,
5.35%, 12/1/08, Callable
12/1/07
@ 102.......................... 1,034
1,575 Montgomery County Hospital,
5.65%, 12/1/12, Callable
12/1/07
@ 102.......................... 1,632
2,000 Montgomery County, Sisters of
Charity, Series A, 6.50%,
5/15/08, Callable 5/15/01 @
102, MBIA...................... 2,166
1,000 North Royalton, GO, 7.50%,
12/1/11, Callable 12/1/00 @
102............................ 1,094
1,000 Northeast Ohio Regional Sewer
District Wastewater, Sewer
Revenue, 6.50%, 11/15/08,
Prerefunded 11/15/01 @ 101,
AMBAC.......................... 1,087
900 Ohio Capital Corp. for Housing,
5.60%, 1/1/07, Callable 7/1/03
@ 102, MBIA.................... 938
500 Olentangy Local School District,
GO, 7.75%, 12/1/11, BIG........ 654
1,250 Olmsted Falls School District,
GO, 0.00%, 12/15/10, AMBAC..... 703
Continued
59
316
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 565 Olmsted Falls School District,
GO, 6.85%, 12/15/11,
Prerefunded 12/15/04 @ 102,
FGIC........................... $ 657
1,000 Ottawa County, GO, 7.00%, 9/1/11,
Callable 9/1/01 @ 102, AMBAC... 1,098
1,000 Pickerington School District, GO,
7.00%, 12/1/13, Prerefunded
12/1/00 @ 102, AMBAC........... 1,089
1,000 Piqua School District, GO, 5.20%,
12/1/15, Callable 12/1/07 @
102, FGIC...................... 1,015
2,600 Portage County, Robinson Memorial
Hospital Project, 5.63%,
11/15/07, Callable 11/15/04 @
102, MBIA...................... 2,803
2,220 Rocky River School District,
School Improvements, GO, 6.90%,
12/1/11, Prerefunded 2/1/00 @
102............................ 2,411
1,000 Saint Mary's Electric Systems
Mortgage Revenue, 7.15%,
12/1/10, Callable 2/1/00 @ 102,
AMBAC.......................... 1,092
1,000 Sandusky County, Hospital
Facility Revenue, Memorial
Hospital, 5.10%, 1/1/09,
Callable 1/1/08 @ 102.......... 999
1,000 Sandusky School District, GO,
7.30%, 12/1/10, Callable
12/1/00
@ 102.......................... 1,091
1,000 Shaker Heights City Schools,
GO, 7.10%, 12/15/10............ 1,196
1,710 Springfield County, School
District, GO, 0.00%, 12/1/12,
AMBAC.......................... 848
1,000 Springfield, GO, 6.88%, 9/1/06,
Callable 9/1/01 @ 102, AMBAC... 1,102
1,000 State Air Quality Development
Authority, Pollution Control
Revenue, Ohio Edison, 7.45%,
3/1/16, Callable 3/1/00 @ 102,
FGIC........................... 1,069
1,000 State Building Authority, 7.35%,
4/1/09, Prerefunded 4/1/00 @
102, MBIA...................... 1,077
2,000 State Building Authority, Adult
Correctional Building, Series
A, 6.13%, 10/1/09, Callable
10/1/03 @ 102.................. 2,207
1,000 State Building Authority, Adult
Correctional Building, Series
A, 5.50%, 4/1/13, Callable
4/1/07 @ 101, AMBAC............ 1,054
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 1,000 State Building Authority, Highway
Safety Building, 5.38%,
10/1/09, Callable 4/1/07 @ 101,
AMBAC.......................... $ 1,064
1,000 State Building Authority, State
Correctional Facilities, Series
A, 6.50%, 10/1/01.............. 1,074
1,000 State Building Authority, State
Facilities, Administration
Building Funds, Series A,
5.75%, 10/1/06, Callable
10/1/04 @ 102, MBIA............ 1,089
1,000 State Building Authority, State
Facilities, Adult Correctional
Building, Series A, 5.25%,
4/1/13, Callable 4/1/08 @
101............................ 1,028
1,000 State Building Authority, State
Facilities, Adult Correctional
Building, Series A, 5.00%,
4/1/15, Callable 4/1/08 @
101............................ 995
2,000 State Building Authority, State
Facilities, J. Rhodes, Series
A, 6.38%, 6/1/07, Callable
6/1/01 @ 102................... 2,159
1,165 State Building Authority, State
Facilities, Transportation
Building Fund, Series A, 6.50%,
9/1/09, Callable 9/1/04 @ 102,
AMBAC.......................... 1,318
1,750 State Elementary & Secondary
Education, 5.63%, 12/1/06...... 1,900
2,510 State Fresh Water Development,
Water Revenue, 5.80%, 6/1/11,
Callable 6/1/05 @ 102, AMBAC... 2,794
800 State Higher Educational
Facilities, 7.25%, 12/1/12,
Prerefunded 12/1/00 @ 102,
FGIC........................... 876
200 State Higher Educational
Facilities, 7.25%, 12/1/12,
Callable 12/1/00 @ 102, FGIC... 218
1,000 State Higher Educational
Facilities, Case Western
Reserve University, Series B,
7.13%, 10/1/14, Prerefunded
10/1/00 @ 102.................. 1,088
1,200 State Higher Educational
Facilities, Case Western
Reserve University, Series C,
5.25%, 10/1/12, Callable
10/1/07 @ 101.................. 1,231
1,000 State Higher Educational
Facilities, Denison University,
5.40%, 11/1/11, Callable
11/1/06
@ 101.......................... 1,047
Continued
60
317
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 1,000 State Higher Educational
Facilities, Denison University,
5.25%, 11/1/16, Callable
11/1/06
@ 101.......................... $ 1,013
1,150 State Higher Educational
Facilities, Series D, 0.00%,
7/1/10......................... 1,171
1,000 State Higher Educational Loan
Revenue, Series A-1, AMT,
5.40%, 12/1/09, Callable 6/1/07
@ 102, AMBAC................... 1,049
1,200 State Housing Finance Agency,
Mortgage, Series A-1, 6.20%,
9/1/14, Callable 3/1/05 @ 102,
GNMA........................... 1,287
885 State Housing Finance Agency,
Multifamily Housing Mortgage
Revenue, 5.30%, 9/1/18,
Callable 3/1/08 @ 102, FHA..... 886
620 State Housing Finance Agency,
Single Family Mortgage Revenue,
Series F, 7.50%, 9/1/10,
Callable 9/1/00 @ 102, GNMA.... 658
1,545 State Housing Finance, Mortgage
Revenue, Series B-3, AMT,
5.25%, 9/1/10, Callable 9/1/07
@ 102, GNMA.................... 1,582
1,000 State Liquor Profits Revenue,
6.85%, 9/1/00, BIG, ETM........ 1,060
1,000 State Water Development
Authority, Pollution Control
Facilities, 5.50%, 12/1/09,
Callable 6/1/05 @ 101, MBIA.... 1,062
1,500 State Water Development
Authority, Water Development
Revenue, 7.00%, 12/1/09,
Callable 6/1/00 @ 102, ETM,
AMBAC.......................... 1,763
1,000 Strongsville, GO, 6.70%, 12/1/11,
Callable 12/1/06 @ 102......... 1,165
1,335 Strongsville, GO, 5.05%, 12/1/14,
Callable 12/1/07 @ 101......... 1,350
800 Toledo Sewer Revenue, 6.20%,
11/15/02, AMBAC................ 866
1,000 Toledo Sewer System Revenue,
7.38%, 11/15/10, Callable
11/15/98 @ 102, MBIA........... 1,033
1,000 Toledo, GO, 5.63%, 12/1/11,
Callable 12/1/06 @ 102,
AMBAC.......................... 1,080
1,000 Toledo, GO, Series B, 0.00%,
12/1/11, FGIC.................. 528
1,000 University of Cincinnati, 7.30%,
6/1/09, Prerefunded 6/1/99 @
100............................ 1,033
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- ---------
MUNICIPAL BONDS, CONTINUED:
Ohio, continued:
$ 1,000 University of Cincinnati,
Certificates of Participation,
University & College
Improvements, 6.75%, 12/1/09,
Callable 12/1/01 @ 102, MBIA... $ 1,105
1,000 University of Cincinnati, General
Receipts, 5.75%, 6/1/13,
Callable 6/1/06 @ 101.......... 1,082
1,000 University of Cincinnati, General
Receipts, Health & Hospital
Improvements, 7.10%, 6/1/10,
Prerefunded 6/1/99 @ 102....... 1,051
1,000 University of Cincinnati, General
Receipts, University & College
Improvements, 7.00%, 6/1/11,
Callable 6/1/01 @ 102.......... 1,093
1,000 University of Cincinnati,
Revenue, Series R2, 6.25%,
6/1/09, Callable 12/1/02 @
102............................ 1,102
1,000 Wadsworth School District, 5.13%,
12/1/15, Callable 12/1/08 @
101, FGIC...................... 1,008
1,000 Westerville, Minerva Park &
Blendon Joint Township, Saint
Ann's Hospital, Series B,
6.80%, 9/15/06, Callable
9/15/01 @ 102, AMBAC, ETM...... 1,131
2,750 Westerville, Minerva Park &
Blendon Joint Township, Saint
Ann's Hospital, Series B,
7.00%, 9/15/12, Callable
9/15/01 @ 102, AMBAC, ETM...... 3,182
1,000 Worthington City School District,
GO, 7.45%, 12/1/12, Prerefunded
12/1/99 @ 102, MBIA............ 1,070
--------
181,435
--------
Texas (0.5%):
2,500 Southeast Texas Housing Financial
Corp., 0.00%, 9/1/17, ETM,
MBIA........................... 949
--------
Washington (0.6%):
1,000 State, Series A & AT-6, GO,
6.25%, 2/1/11.................. 1,151
--------
Total Municipal Bonds 192,272
--------
INVESTMENT COMPANIES (0.5%):
278 Fidelity Ohio Tax Free Money
Market Fund.................... 278
673 The One Group Ohio Municipal
Money Market Fiduciary Class... 674
--------
Total Investment Companies 952
--------
Total (Cost $180,818) (a) $193,224
========
Continued
61
318
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ohio Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
- ------------
Percentages indicated are based on net assets of $193,325.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting in excess of federal income tax reporting of
approximately $38. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $12,383
Unrealized depreciation..................................... (15)
-------
Net unrealized appreciation................................. $12,368
=======
* Variable rate securities having liquidity sources through bank letters of
credit or other cards and/or liquidity agreements. The interest rate, which
will change periodically, is based upon bank prime rates or an index of
market rates. The rate reflected on the Schedule of Portfolio Investments is
the rate in effect at June 30, 1998.
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax Paper
BIG Insured by Bond Insurance Guarantee
ETM Escrowed to Maturity
FGIC Insured by Federal Guarantee Insurance Corp.
FHA Insured by Federal Housing Administration
FNMA Insured by Federal National Mortgage Association
FSA Insured by Federal Security Assurance
GNMA Insured by Government National Mortgage Association
GO General Obligation
MBIA Insured by Municipal Bond Insurance Association
See notes to financial statements.
62
319
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Louisiana Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS (99.9%):
Louisiana (99.9%):
$ 1,165 Ascension Parish, Gravity Drain,
Sales & Use Tax, 5.40%, 12/1/07,
Callable 12/1/06 @100, FGIC........ $ 1,239
1,230 Ascension Parish, Gravity Drain,
Sales & Use Tax, 5.50%, 12/1/08,
Callable 12/1/06 @ 100, FGIC....... 1,311
2,500 Bastrop, Industrial Development
Board, Pollution Control Revenue,
International Paper Co. Project,
6.90%, 3/1/07, Callable 3/1/02 @
102................................ 2,751
700 Baton Rouge, Public Improvements,
Sales & Use Tax, 6.85%, 8/1/00,
Callable 8/1/99 @ 102, AMBAC....... 735
800 Baton Rouge, Public Improvements,
Sales & Use Tax, 6.90%, 8/1/01,
Callable 8/1/99 @ 102, AMBAC....... 842
765 Baton Rouge, Public Improvements,
Sales & Use Tax, 6.38%, 8/1/09,
Callable 8/1/01 @ 101.5, FSA....... 827
700 Bossier City, Public Improvements,
Sales & Use Tax, Revenue, 5.05%,
11/1/11, Callable 11/1/07 @ 100,
FGIC............................... 711
805 Bossier City, Public Improvements,
Sales & Use Tax, Revenue, Series
ST, 6.20%, 11/1/07, Callable
11/1/01 @ 102, AMBAC............... 872
400 Bossier City, Public Improvements,
Sales & Use Tax, Series ST-1989,
6.88%, 11/1/06, Callable 11/1/99 @
101.5, FGIC........................ 422
400 Bossier City, Public Improvements,
Sales & Use Tax, Series ST-1989,
6.88%, 11/1/07, Callable 11/1/99 @
101.5, FGIC........................ 422
550 Bossier City, Public Improvements,
Sales & Use Tax, Series ST-1989,
6.88%, 11/1/08, Callable 11/1/99 @
101.5, FGIC........................ 581
1,415 Caddo Parish, GO, 5.25%, 2/1/06,
Callable 2/1/05 @ 100, MBIA........ 1,483
750 Caddo Parish, GO, 5.25%, 2/1/08,
Callable 2/1/05 @ 100, MBIA........ 782
470 Caddo Parish, Industrial Development
Board, Wal-Mart Stores, Inc.
Project, 5.95%, 11/1/07, Callable
11/1/98 @ 101...................... 476
500 Calcasieu Parish, School District
#22, Ward 3, Series A, GO, 7.10%,
2/1/01, Callable 2/1/99 @ 100,
BIG................................ 510
500 East Baton Rouge Parish, Sales & Use
Tax, 7.10%, 2/1/00, Callable 2/1/99
@ 101.5, MBIA...................... 518
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 500 East Baton Rouge Parish, Sales & Use
Tax, Series ST, 5.80%, 2/1/07,
Callable 2/1/05 @ 101.5, FGIC...... $ 543
845 East Baton Rouge Parish, Sales & Use
Tax, Series ST, 5.80%, 2/1/08,
Callable 2/1/05 @ 101.5, FGIC...... 914
910 East Baton Rouge Parish, Sales & Use
Tax, Series ST, 5.80%, 2/1/09,
Callable 2/1/05 @ 101.5, FGIC...... 981
1,085 East Baton Rouge Parish, Series ST,
5.15%, 2/1/05, Callable 2/1/03 @
101.5.............................. 1,128
1,000 East Baton Rouge Parish, Series ST,
5.10%, 2/1/07, Callable 2/1/06 @
101.5, FGIC........................ 1,043
2,280 East Baton Rouge Parish, Series ST-A,
8.00%, 2/1/02, FGIC................ 2,565
1,560 Houma Utilities Revenue, 6.13%,
1/1/07, Callable 1/1/02 @ 102,
FGIC............................... 1,686
485 Housing Finance Agency, Mortgage
Revenue, Series D-2, AMT, 6.10%,
12/1/11, Callable 12/1/06 @ 102.... 520
1,000 Housing Finance Agency, Mortgage
Revenue, Single Family, 6.65%,
6/1/15, Callable 12/1/07 @ 104,
GNMA/FNMA.......................... 1,108
515 Housing Finance Agency, Mortgage
Revenue, Single Family A-1, 5.70%,
6/1/15, Callable 6/1/05 @ 102...... 532
1,115 Iberia Home Mortgage Authority,
Single Family Mortgage Revenue,
7.38%, 1/1/11, Callable 7/1/03 @
103................................ 1,207
400 Jefferson Parish, Construction
Waterworks, District #2, 7.25%,
1/15/00, Callable 1/15/99 @ 100.... 407
1,680 Jefferson Parish, Drain Sales Tax
Revenue, 6.50%, 11/1/06,
Prerefunded 11/1/01 @ 100, AMBAC... 1,811
500 Jefferson Parish, School Board Sales
& Use Tax Revenue, 6.05%, 2/1/02,
MBIA............................... 531
1,100 Jefferson Parish, School Board Sales
& Use Tax Revenue, 6.15%, 2/1/03,
Callable 2/1/02 @ 102, MBIA........ 1,187
2,760 Jefferson Parish, School Board Sales
& Use Tax Revenue, 6.25%, 2/1/08,
Callable 2/1/02 @ 102, MBIA........ 2,997
2,070 Jefferson Parish, School Board Sales
& Use Tax Revenue, 0.00%, 9/1/09,
FSA................................ 1,225
1,000 Jefferson, Sales Tax District
Special, Tax Revenue, 0.00%,
12/1/13, FSA....................... 463
Continued
63
320
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Louisiana Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 4,670 Jefferson, Sales Tax District
Special, Tax Revenue, Series A,
6.75%, 12/1/06, Callable 12/1/02 @
100, FGIC.......................... $ 5,150
755 Kenner, Sales & Use Tax Revenue,
5.75%, 6/1/06, Callable 6/1/02 @
103, FGIC.......................... 809
1,000 Lafayette Parish, GO, 7.80%, 3/1/01,
Callable 7/30/98 @ 102, FGIC....... 1,023
750 Lafourche Parish, Hospital Service,
District #3, Hospital Revenue,
5.50%, 10/1/04, Callable 10/1/03 @
102................................ 786
1,525 Lafourche Parish, School District #1,
Parish Wide, GO, 5.00%, 2/1/13,
Callable 2/1/08 @ 100, FSA......... 1,523
650 Lafourche Parish, Water District #1,
Water Revenue, 5.63%, 1/1/01....... 672
500 Lincoln Parish, School District #1,
GO, Ruston, 6.20%, 3/1/03, Callable
3/1/01 @ 100, MBIA................. 527
1,465 Lincoln Parish, School District #1,
GO, Ruston, 6.40%, 3/1/05, Callable
3/1/01 @ 100, MBIA................. 1,551
1,000 Louisiana State University,
Agricultural & Mechanical College,
University Revenues, 6.00%, 7/1/07,
Callable 7/1/06 @ 102, MBIA........ 1,111
1,120 Louisiana State University,
Agricultural & Mechanical College,
University Revenues, 5.50%, 7/1/13,
Callable 7/1/06 @ 102, MBIA........ 1,173
1,220 Monroe Parish, Special School
District, GO, 8.00%, 3/1/01,
MBIA............................... 1,339
1,300 Monroe Parish, Special School
District, GO, 7.00%, 3/1/02,
MBIA............................... 1,423
1,390 Monroe Parish, Special School
District, GO, 7.00%, 3/1/03,
MBIA............................... 1,550
1,230 Monroe Parish, Special School
District, GO, 5.35%, 3/1/05,
FGIC............................... 1,299
1,320 Monroe Parish, Special School
District, GO, 5.35%, 3/1/06,
Callable 3/1/05 @ 100, FGIC........ 1,389
1,000 New Orleans, Audubon Park, Revenue,
5.00%, 4/1/12, Callable 4/1/07 @
101, MBIA.......................... 1,004
1,000 New Orleans, GO, 5.88%, 10/1/11,
Callable 10/1/05 @ 101, AMBAC...... 1,090
2,000 New Orleans, GO, 0.00%, 9/1/16,
AMBAC.............................. 769
3,555 New Orleans, GO, 0.00%, 9/1/17,
AMBAC.............................. 1,290
550 New Orleans, GO, Public Improvement,
5.85%, 11/1/07, Callable 11/1/05 @
100, FGIC.......................... 595
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 1,000 New Orleans, GO, Series B, 5.00%,
12/1/12, Callable 12/1/08 @ 102,
FSA................................ $ 997
1,000 Orleans Parish School District, GO,
Series A, 5.13%, 9/1/13, Callable
3/1/08 @ 100, MBIA................. 1,010
1,000 Ouachita Parish, Hospital Service
District #1, Glenwood Regional
Medical Center, 5.70%, 5/15/16,
Callable 5/15/10 @ 100, FSA........ 1,063
2,525 Ouachita Parish, Hospital Service
District #1, Glenwood Regional
Medical Center, Health Care
Revenue, 7.50%, 7/1/06, Callable
7/1/01 @ 102....................... 2,810
2,000 Ouachita Parish, West School
District, Series A, 6.50%, 3/1/03,
Callable 3/1/01 @ 102, FSA......... 2,160
1,440 Plaquemines Parish, GO, 6.40%,
8/1/04, Callable 8/1/01 @ 102,
AMBAC.............................. 1,562
420 Plaquemines Parish, Sales & Use Tax,
6.70%, 12/1/08, Prerefunded 12/1/01
@ 102.............................. 462
410 Plaquemines Parish, Sales & Use Tax,
6.70%, 12/1/09, Prerefunded 12/1/01
@ 102.............................. 451
605 Plaquemines Parish, School Board,
Sales & Use Tax, 6.65%, 3/1/05,
Prerefunded 3/1/02 @ 102........... 667
2,180 Public Facilities Authority Revenue,
Alton Ochsner Medical Foundation,
Series A, 6.30%, 5/15/04, Callable
5/15/02 @ 102, MBIA................ 2,381
1,000 Public Facilities Authority Revenue,
Alton Ochsner Medical Project,
Series B, 5.75%, 5/15/11, Callable
5/15/02 @ 100, MBIA................ 1,054
1,000 Public Facilities Authority Revenue,
Dillard University, 5.00%, 2/1/18,
Callable 2/10/08 @ 102, AMBAC...... 980
1,000 Public Facilities Authority Revenue,
Franciscan Missionaries Foundation,
Series C, 5.38%, 7/1/13, Callable
7/1/08 @ 101, MBIA................. 1,031
1,000 Public Facilities Authority Revenue,
Indexed Caps, 5.88%, 2/15/11,
Callable 2/15/03 @ 102, FGIC....... 1,078
500 Public Facilities Authority Revenue,
Lafayette General Medical Center
Project, Hospital Revenue, 6.05%,
10/1/04, Callable 10/1/02 @ 102,
FSA................................ 541
Continued
64
321
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Louisiana Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 1,960 Public Facilities Authority Revenue,
Loyola University, 6.60%, 4/1/05,
Callable 4/1/02 @ 102.............. $ 2,158
2,525 Public Facilities Authority Revenue,
Loyola University, 5.63%, 10/1/10,
Callable 10/1/07 @ 102, MBIA....... 2,731
500 Public Facilities Authority Revenue,
Loyola University, Series A, 7.20%,
10/1/00, Callable 10/1/99 @ 102.... 529
1,135 Public Facilities Authority Revenue,
Mary Bird Perkins Cancer Center,
5.50%, 1/1/04, FSA................. 1,199
5,000 Public Facilities Authority Revenue,
Multi-Family, Series A, 0.00%,
2/1/20, ETM........................ 1,661
500 Public Facilities Authority Revenue,
Our Lady of Lake Regional Center,
Series C, Health Care Revenue,
5.70%, 12/1/04, Callable 12/1/01 @
102, MBIA.......................... 529
1,000 Public Facilities Authority Revenue,
Pendelton Memorial Methodist
Hospital, 5.00%, 6/1/08............ 994
7,500 Public Facilities Authority Revenue,
Series B, 0.00%, 12/1/19, ETM...... 2,513
110 Public Facilities Authority Revenue,
Sisters of Mercy, 7.38%, 6/1/09,
Callable 6/1/99 @ 102.............. 115
2,145 Public Facilities Authority Revenue,
Tulane University, 6.25%, 7/15/06,
Callable 7/15/01 @ 102............. 2,306
735 Public Facilities Authority Revenue,
Tulane University, 5.55%, 10/1/07,
Callable 10/1/06 @ 102, AMBAC...... 794
1,605 Public Facilities Authority Revenue,
Tulane University, 5.75%, 10/1/09,
Callable 10/1/06 @ 102, AMBAC...... 1,752
300 Public Facilities Authority Revenue,
Tulane University, Series A, 7.50%,
5/15/00, Callable 5/15/99 @ 101.... 307
225 Public Facilities Authority Revenue,
Tulane University, Series A-1,
5.80%, 2/15/04, Callable 2/15/03 @
102, FGIC.......................... 242
1,235 Public Facilities Authority Revenue,
Women's Hospital Foundation, Health
Care Revenue, 6.85%, 10/1/05,
Callable 10/1/02 @ 102............. 1,383
730 Public Facilities Authority Revenue,
Women's Hospital Foundation, Health
Care Revenue, 5.40%, 10/1/05,
Callable 10/1/04 @ 102, FGIC....... 772
1,715 Public Facilities Authority Revenue,
Women's Hospital Foundation, Health
Care Revenue, 5.50%, 10/1/06,
Callable 10/1/04 @ 102, FGIC....... 1,833
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 500 Public Facilities Authority Revenue,
Women's Hospital Foundation, Health
Care Revenue, 6.00%, 10/1/10,
FSA................................ $ 560
2,000 Public Facilities Authority Revenue,
Xavier University of Louisiana,
5.13%, 9/1/12, Callable 9/1/07 @
102, MBIA.......................... 2,033
500 Rapides Parish, Consolidated School
District #62, GO, 7.25%, 4/1/00,
Callable 4/1/99 @ 100, MBIA........ 513
1,475 Rapides Parish, School District #11,
Rigolette-Series 1990, GO, 6.95%,
2/1/02, Prerefunded 2/1/00 @ 100,
FGIC............................... 1,543
1,000 Shreveport, Certificates of
Indebtedness Revenue, Series A,
5.50%, 10/1/12, Callable 10/1/09 @
102, AMBAC......................... 1,054
480 Shreveport, GO, 6.20%, 3/1/02,
Callable 3/1/01 @ 100, AMBAC....... 505
500 Shreveport, GO, 6.70%, 2/1/03,
Prerefunded 2/1/00 @ 100, AMBAC.... 522
480 Shreveport, GO, 5.90%, 2/1/07,
Callable 2/1/03 @ 100.............. 510
930 Shreveport, Water & Sewer Revenue,
Series A, 7.75%, 12/1/02, FGIC..... 1,062
500 Shreveport, Water & Sewer Revenue,
Series A, 6.25%, 12/1/03, FGIC..... 549
1,000 South Port Community, Port Revenue,
Cargill, Inc. Project, 5.85%,
4/1/17, Callable 4/1/07 @ 102...... 1,060
750 St. Charles Parish, Public
Improvements Sales Tax, 6.60%,
11/1/07, Callable 11/1/99 @ 102.... 791
2,350 St. Charles Parish, School District
#1, GO, 6.45%, 3/1/06, Callable
3/1/02 @ 100, AMBAC................ 2,530
870 St. John Baptist Parish, School
District #1, GO, 6.25%, 3/1/05,
Callable 3/1/02 @ 100.............. 920
1,815 St. Tammany Parish, Hospital Service,
District #1, Hospital Revenue,
6.30%, 7/1/07, Callable 7/1/02 @
102................................ 1,952
1,000 St. Tammany Parish, Justice Complex
Sales Tax, 5.00%, 4/1/13, Callable
4/1/08 @ 102, FGIC................. 998
1,225 St. Tammany Parish, Public Financing
Authority Revenue, Christwood
Project, 5.25%, 11/15/08........... 1,199
Continued
65
322
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Louisiana Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 1,000 St. Tammany Parish, Sales & Use Tax,
District #3, Series A, 6.50%,
12/1/02, Callable 12/1/99 @ 102,
FGIC............................... $ 1,055
750 St. Tammany Parish, Sales & Use Tax,
District #3, Series A, 6.50%,
12/1/05, Callable 12/1/99 @ 102,
FGIC............................... 792
400 St. Tammany Parish, School District
#12, GO, 6.50%, 3/1/04, Callable
3/1/01 @ 100, FGIC................. 424
1,665 Stadium & Exposition District, Hotel
Occupancy Tax & Stadium Revenue,
Series A, 5.65%, 7/1/07, Callable
7/1/04 @ 102, FGIC................. 1,792
1,500 State Gas & Fuels Tax Revenue, Series
A, 7.25%, 11/15/04, Callable
11/15/99 @ 102..................... 1,591
1,000 State GO, 7.10%, 9/1/03, Prerefunded
9/1/00 @ 102, FSA.................. 1,084
3,000 State GO, Series A, 6.50%, 4/15/06,
FGIC............................... 3,404
430 State GO, Series A, 6.00%, 5/1/08,
Prerefunded 5/1/04 @ 102, AMBAC.... 476
2,875 State GO, Series A, 5.80%, 8/1/10,
MBIA............................... 3,185
500 State GO, Series A, 6.10%, 5/1/11,
Prerefunded 5/1/04 @ 102, AMBAC.... 556
3,000 State GO, Series B, 5.63%, 8/1/13,
MBIA............................... 3,263
500 State Offshore Terminal Authority,
Deepwater Port Revenue, 1st Stage,
Series B, 6.10%, 9/1/02............ 533
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ------------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Louisiana, continued:
$ 1,325 State Offshore Terminal Authority,
Deepwater Port Revenue, 1st Stage,
Series B, 6.25%, 9/1/04............ $ 1,444
1,435 Tangipahoa Parish, Consolidated
School District #1, GO, 6.15%,
12/1/07, Callable 12/1/02 @ 100.... 1,532
1,250 Tangipahoa Parish, Hospital Service
District #1, Hospital Revenue,
6.13%, 2/1/14, Callable 2/1/04 @
102, AMBAC......................... 1,371
1,000 Terrebonne Parish, Hospital Service
District #1, 5.20%, 4/1/13,
Callable 4/1/08 @ 102, AMBAC....... 1,009
690 Terrebonne Parish, Waterworks
District #1, Water Revenue, 5.70%,
11/1/06, Callable 11/1/03 @ 102,
FGIC............................... 742
500 Terrebonne Parish, Waterworks
District #1, Water Revenue, 5.75%,
11/1/08, Callable 11/1/03 @ 102,
FGIC............................... 541
555 Vermilion Parish, Hospital Service,
District #2, Health Care Revenue,
Series A, 6.35%, 5/1/00, MBIA...... 578
--------
Total Municipal Bonds 145,141
--------
INVESTMENT COMPANIES (0.3%):
383 The One Group Municipal Money Market
Fund, Fiduciary Class.............. 383
--------
Total Investment Companies 383
--------
Total (Cost $137,584) (a) $145,524
========
- ------------
Percentages indicated are based on net assets of $145,242.
(a) Represents cost for financial reporting and federal income tax purposes and
differs from value by net unrealized appreciation of securities as follows
(amounts in thousands):
Unrealized appreciation..................................... $7,962
Unrealized depreciation..................................... (22)
------
Net unrealized appreciation................................. $7,940
======
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax Paper
BIG Insured by Bond Insurance Guarantee
ETM Escrowed to Maturity
FGIC Insured by Federal Guarantee Insurance Corp.
FSA Insured by Federal Security Assurance
GNMA Insured by Government National Mortgage Association
GO General Obligation
MBIA Insured by Municipal Bond Insurance Association
See notes to financial statements.
66
323
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
West Virginia Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS (99.0%):
Arizona (0.4%):
$ 1,000 Maricopa County, Individual
Development Single Family
Mortgage, Revenue, 0.00%,
12/31/14, ETM.................... $ 441
--------
Hawaii (0.4%):
400 State GO, Series BT, 8.13%,
2/1/00........................... 426
--------
Maryland (0.7%):
3,000 Prince Georges County Housing
Authority Revenue, Foxglenn
Apts., Series A, AMT, 0.00%,
5/20/22, Callable 7/22/98 @
26.42, GNMA...................... 791
--------
Ohio (0.8%):
500 Columbus, GO, 8.13%, 5/1/04........ 600
250 Public Community Facilities, Higher
Education Cap, Revenue, Series
II-B, 5.38%, 11/1/00, AMBAC...... 258
--------
858
--------
Puerto Rico (1.0%):
1,000 Puerto Rico Industrial Tourist
Educational, Medical and
Environmental Control Facilities,
Auxilio Mutuo Hospital Obligation
Group, 5.80%, 7/1/06, Callable
1/1/05 @ 102, MBIA............... 1,096
--------
Virginia (0.2%):
200 State Public School Authority
Revenue, Series A, 6.30%,
8/1/01........................... 213
--------
West Virginia (95.5%):
170 Bath & Waterworks Revenue, 5.80%,
9/1/19, Callable 9/1/07 @ 102.... 175
200 Berkeley County, Building
Community, Hospital Revenue, City
Hospital Project, 5.40%,
11/1/98.......................... 201
1,000 Berkeley County, Building
Community, Hospital Revenue, City
Hospital Project, 6.50%, 11/1/09,
Callable 11/1/02 @ 102........... 1,082
1,000 Berkeley County, Education Board,
GO, 5.50%, 4/1/01................ 1,037
800 Berkeley County, Education Board,
GO, 5.55%, 4/1/02................ 839
900 Berkeley County, Education Board,
GO, 5.60%, 4/1/03................ 953
500 Berkeley County, Education Board,
GO, 5.00%, 6/1/08, Callable
6/1/05 @ 100, FGIC............... 516
1,525 Brooke Pleasants Tyler Wetzed
Counties, Single Family Mortgage
Revenue, 7.40%, 8/15/10, ETM..... 1,903
225 Cabell County, Education Board, GO,
6.10%, 5/1/99, MBIA, ETM......... 230
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 150 Cabell County, Education Board, GO,
6.20%, 5/1/00, MBIA, ETM......... $ 156
1,670 Cabell County, Education Board, GO,
6.60%, 5/1/04, MBIA, ETM......... 1,874
1,500 Cabell County, Education Board, GO,
6.00%, 5/1/06, MBIA, ETM......... 1,667
80 Charles Town Residential Mortgage,
Revenue, Series A, 5.40%,
9/1/02........................... 83
80 Charles Town Residential Mortgage,
Revenue, Series A, 5.56%,
3/1/03........................... 84
75 Charles Town Residential Mortgage,
Revenue, Series A, 5.70%, 9/1/04,
Callable 3/1/03 @ 102............ 79
1,555 Charleston Building Community,
Parking Facility Revenue, Capital
Appreciation, 0.00%, 12/1/17..... 496
1,570 Charleston Building Community,
Parking Facility Revenue, Capital
Appreciation, 0.00%, 12/1/18..... 469
1,570 Charleston Building Community,
Parking Facility Revenue, Capital
Appreciation, 0.00%, 12/1/19..... 437
400 Charleston Building Community,
Parking Facility Revenue, Capital
Appreciation, 0.00%, 12/1/20..... 104
1,010 Charleston Parking Revenue, Series
B, 6.75%, 6/1/08, Callable
12/1/04 @ 102.................... 1,162
1,020 Clarksburg Water Revenue, Capital
Appreciation, Asset Guaranty,
0.00%, 9/1/08, FSA............... 640
1,000 Clarksburg Water Revenue, Capital
Appreciation, Asset Guaranty,
0.00%, 9/1/11, FSA............... 531
1,000 Clarksburg Water Revenue, Capital
Appreciation, Asset Guaranty,
0.00%, 9/1/12, FSA............... 499
1,270 Fairmont General Hospital Revenue,
5.15%, 11/1/07................... 1,288
790 Fairmont Waterworks Revenue, 5.30%,
7/1/09, Callable 7/1/07 @ 102,
MBIA............................. 839
925 Fairmont Waterworks Revenue, 5.50%,
7/1/12, Callable 7/1/07 @ 102,
MBIA............................. 980
2,500 Harrison County, Board of
Education, GO, 6.40%, 5/1/07,
FGIC............................. 2,857
2,000 Harrison County, Community Special
Obligation, Revenue, Series A,
6.25%, 5/15/10, ETM.............. 2,300
1,500 Harrison County, Education Board,
GO, 6.30%, 5/1/05, FGIC.......... 1,674
Continued
67
324
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
West Virginia Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 505 Harrison County, Healthcare
Building Revenue, Maplewood
Retirement Center, 5.00%, 4/1/12,
Callable 4/1/08 @ 102, AMBAC..... $ 506
500 Harrison County, Healthcare
Building Revenue, Maplewood
Retirement Center, 5.10%, 4/1/13,
Callable 4/1/08 @ 102, AMBAC..... 503
95 Huntington Residential Mortgage
Revenue, 6.30%, 9/1/98........... 95
735 Jackson County, Residential
Mortgage Revenue, 7.38%, 6/1/10,
Callable 12/1/98 @ 100, FGIC,
ETM.............................. 922
1,000 Kanawha County, Community Building
Revenue, Charleston Hospital,
7.50%, 11/1/08, Prerefunded
11/1/99 @ 102, AMBAC............. 1,068
3,910 Kanawha Mercer Nicholas Counties,
Single Family Mortgage Revenue,
0.00%, 2/1/15, Prerefunded 2/1/14
@ 89.8........................... 1,622
4,435 Kanawha-Putnam County, Single
Family Mortgage Revenue, Series
A, 0.00%, 12/1/16, AMBAC, ETM.... 1,748
1,668 Keyser Housing Corp. Mortgage
Revenue, 7.25%, 4/1/21, Callable
8/6/98 @ 101, FHA................ 1,687
1,065 Marion County, Single Family
Mortgage Revenue, 7.38%, 8/1/11,
FGIC, ETM........................ 1,327
500 Marshall County, Special
Obligation, 6.50%, 5/15/10,
ETM.............................. 570
1,000 Monongalia County, Board of
Education, GO, 7.00%, 4/1/03,
MBIA............................. 1,120
440 Monongalia County, Board of
Education, GO, 7.00%, 4/1/04,
MBIA............................. 501
300 Monongalia County, Board of
Education, GO, 7.00%, 4/1/05,
MBIA............................. 346
1,000 Monongalia County, Building
Community, Healthcare Revenue,
5.75%, 11/15/14, Callable
11/15/02 @ 102................... 1,009
1,725 Ohio County, Board of Education,
GO, 5.00%, 6/1/13, Callable
6/1/08 @ 102..................... 1,719
1,295 Parkersburg Waterworks & Sewer
System Revenue, 5.50%, 3/1/10,
Callable 9/1/06 @ 102, FSA....... 1,388
1,335 Parkersburg Waterworks & Sewer
System Revenue, 5.50%, 9/1/10,
Callable 9/1/06 @ 102, FSA....... 1,431
900 Parkersburg Waterworks & Sewer
System Revenue, 5.70%, 9/1/13,
Callable 9/1/06 @ 102, FSA....... 968
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 1,000 Pleasants County, Pollution Control
Revenue, Potomac Power, 6.15%,
5/1/15, Callable 5/1/05 @ 102,
MBIA............................. $ 1,090
1,000 Pleasants County, Pollution Control
Revenue, Potomac Power, 6.15%,
5/1/15, Callable 5/1/05 @ 102,
AMBAC............................ 1,090
1,750 Pleasants County, Pollution Control
Revenue, West Penn Power, 6.15%,
5/1/15, Callable 5/1/05 @ 102,
AMBAC............................ 1,908
1,015 Putnam County, Pollution Control
Revenue, FMC Corp., 5.63%,
10/1/13, Callable 10/1/07 @
102.............................. 1,050
2,000 Randolph County, Health Systems
Revenue, Davis Health Systems,
Inc., 5.20%, 11/1/15, Callable
11/1/13 @ 100, FSA............... 2,019
1,500 School Building Authority Revenue
Capital Improvement, 5.25%,
7/1/99, MBIA..................... 1,525
1,750 School Building Authority Revenue
Capital Improvement, 6.25%,
7/1/01, MBIA..................... 1,861
1,000 School Building Authority Revenue
Capital Improvement, 5.50%,
7/1/11, Callable 7/1/07 @ 102,
AMBAC............................ 1,066
800 School Building Authority Revenue
Capital Improvement, Series B,
6.80%, 7/1/00, MBIA.............. 844
1,000 School Building Authority Revenue
Capital Improvement, Series B,
6.90%, 7/1/02, Callable 7/1/00 @
102, MBIA........................ 1,076
500 School Building Authority Revenue
Capital Improvement, Series B,
6.95%, 7/1/03, Prerefunded 7/1/00
@ 102, MBIA...................... 539
200 School Building Authority Revenue
Capital Improvement, Series B,
6.75%, 7/1/06, MBIA.............. 232
1,000 School Building Authority Revenue
Capital Improvement, Series B,
6.00%, 7/1/12, Callable 7/1/02 @
100, MBIA........................ 1,062
500 State Building Common Lease
Revenue, 6.70%, 7/1/02, Callable
7/1/00 @ 102, MBIA............... 536
Continued
68
325
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
West Virginia Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 1,000 State Building, Lottery Commission
Revenue, Series A, 5.25%, 7/1/08,
Callable 7/1/07 @ 102, MBIA...... $ 1,056
1,000 State Building, Lottery Commission
Revenue, Series A, 5.25%, 7/1/09,
Callable 7/1/07 @ 102, MBIA...... 1,053
250 State GO, 5.25%, 3/1/01, Callable
8/6/98 @ 100..................... 250
200 State GO, 5.70%, 6/1/01, Callable
8/6/98 @ 100..................... 201
1,200 State GO, 6.10%, 6/1/03, Callable
8/6/98 @ 100.5................... 1,208
250 State GO, Series A, 5.20%,
2/1/99........................... 252
300 State GO, Series A, 5.30%,
2/1/00........................... 307
600 State GO, Series A, 5.40%,
2/1/01........................... 620
2,500 State GO, Series A, 5.50%,
2/1/02........................... 2,614
1,000 State GO, Series B, AMT, 5.80%,
11/1/11, Callable 11/1/06 @ 102,
FGIC............................. 1,094
1,000 State GO, Series B, AMT, 5.85%,
11/1/12, Callable 11/1/06 @ 102,
FGIC............................. 1,094
1,160 State GO, Series B, AMT, 5.10%,
11/1/15, Callable 11/1/08 @ 102,
FGIC............................. 1,158
625 State Hospital Finance Authority,
Hospital Revenue, 5.50%, 1/1/02,
MBIA............................. 652
500 State Hospital Finance Authority,
Hospital Revenue, 5.70%, 1/1/04,
Callable 1/1/02 @ 102, MBIA...... 531
500 State Hospital Finance Authority,
Hospital Revenue, 7.00%, 8/1/04,
Prerefunded 8/1/99 @ 102, FSA.... 527
2,350 State Hospital Finance Authority,
Hospital Revenue, 5.10%, 6/1/06,
Callable 6/1/03 @ 102, MBIA...... 2,442
1,000 State Hospital Finance Authority,
Hospital Revenue, 5.13%, 9/1/06,
Callable 9/1/05 @ 102, MBIA...... 1,047
1,000 State Hospital Finance Authority,
Hospital Revenue, 7.00%, 8/1/09,
Prerefunded 8/1/99 @ 102, FSA.... 1,055
1,000 State Hospital Finance Authority,
Hospital Revenue, 5.75%, 9/1/13,
Callable 9/1/05 @ 102, MBIA...... 1,070
140 State Housing Development, 5.50%,
11/1/98, FHA..................... 141
450 State Housing Development, 7.00%,
5/1/99, Callable 8/6/98 @ 102,
FHA.............................. 460
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 190 State Housing Development, 6.30%,
11/1/03, Callable 5/1/02 @ 103,
FHA.............................. $ 203
195 State Housing Development, 6.40%,
5/1/04, Callable 5/1/02 @ 103,
FHA.............................. 210
205 State Housing Development, 6.40%,
11/1/04, Callable 5/1/02 @ 103,
FHA.............................. 221
500 State Housing Development, 7.38%,
11/1/05, Callable 8/6/98 @ 102,
FHA.............................. 517
245 State Housing Development, 6.75%,
11/1/10, Callable 5/1/02 @ 103,
FHA.............................. 265
315 State Housing Development, 6.75%,
5/1/11, Callable 5/1/02 @ 103,
FHA.............................. 341
1,000 State Housing Development, 7.40%,
11/1/11, Callable 8/6/98 @ 102,
FHA.............................. 1,032
320 State Housing Development, 6.75%,
11/1/11, Callable 5/1/02 @ 103,
FHA.............................. 346
1,000 State Housing Development, 7.40%,
11/1/13, Callable 8/6/98 @ 102,
FHA.............................. 1,033
500 State Housing Development, 7.40%,
11/1/13, Callable 8/6/98 @ 102,
FHA, AMBAC....................... 517
1,000 State Housing Development, 5.05%,
11/1/14, Callable 5/1/08 @
101.5............................ 990
1,000 State Housing Development, 5.10%,
11/1/15, Callable 5/1/08 @
101.5............................ 992
1,000 State Housing Development, 5.80%,
5/1/17, Callable 5/1/07 @ 102.... 1,047
655 State Housing Development, AMT,
5.65%, 11/1/15, Callable 11/1/07
@ 102............................ 677
1,520 State Single Family Housing
Mortgage Revenue, 5.30%, 8/1/13,
Callable 8/1/07 @ 102,
GNMA/FNMA........................ 1,565
1,500 State University Revenue, 5.75%,
4/1/03, AMBAC.................... 1,601
1,500 State University Revenue, 5.75%,
4/1/04, Callable 4/1/03 @ 102,
AMBAC............................ 1,615
1,000 State University Revenue, 6.00%,
4/1/07, Callable 4/1/03 @ 102,
AMBAC............................ 1,089
1,000 State University Revenue, 6.00%,
4/1/12, Callable 4/1/03 @ 102,
AMBAC............................ 1,084
Continued
69
326
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
West Virginia Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 100 State Water Development Authority
Revenue, Loan Program, Series A,
7.30%, 11/1/99................... $ 104
100 State Water Development Authority
Revenue, Loan Program, Series A,
7.40%, 11/1/00................... 107
130 State Water Development Authority
Revenue, Loan Program, Series A,
6.90%, 11/1/01................... 141
160 State Water Development Authority
Revenue, Loan Program, Series A,
7.10%, 11/1/04, Callable 11/1/01
@ 102............................ 176
2,000 State Water Development Authority
Revenue, Loan Program, Series A,
7.00%, 11/1/11, Callable 11/1/01
@ 102, FSA....................... 2,205
225 University Dormitory Revenue,
Series A, 5.60%, 5/1/99, MBIA.... 229
750 University Revenues, State
University System, Marshall
University Library, 5.60%,
4/1/11, Callable 4/1/06 @ 101,
AMBAC............................ 800
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
West Virginia, continued:
$ 1,715 West Virginia University, Revenue,
Series A, 5.30%, 5/1/12, Callable
11/1/07 @ 101, AMBAC............. $ 1,783
1,125 West Virginia University, Revenue,
Series A, 5.25%, 4/1/13, Callable
4/1/08 @ 102, AMBAC.............. 1,158
1,000 Wheeling Waterworks & Sewer System
Revenue, 5.40%, 6/1/11, Callable
6/1/07 @ 100, FGIC............... 1,047
1,200 Wheeling Waterworks & Sewer System
Revenue, Series C, 6.60%, 6/1/12,
Prerefunded 6/1/02 @ 100, FGIC... 1,309
--------
102,819
--------
Total Municipal Bonds 106,644
--------
INVESTMENT COMPANIES (0.1%):
126 The One Group Municipal Money
Market Fund, Fiduciary Class..... 126
--------
Total Investment Companies 126
--------
Total (Cost $100,248) (a) $106,770
========
- ------------
Percentages indicated are based on net assets of $107,789.
(a) Represents cost for financial reporting and federal income tax purposes and
differs from value by net unrealized appreciation of securities as follows
(amounts in thousands):
Unrealized appreciation..................................... $6,536
Unrealized depreciation..................................... (14)
------
Net unrealized appreciation................................. $6,522
======
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax Paper
ETM Escrowed to Maturity
FGIC Insured by Federal Guarantee Insurance Corp.
FHA Insured by Federal Housing Administration
FSA Insured by Federal Security Assurance
GO General Obligation
GNMA Insured by Government National Mortgage Association
MBIA Insured by Municipal Bond Insurance Association
See notes to financial statements.
70
327
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Arizona Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS (98.8%):
Arizona (97.6%):
$ 1,175 Apache County, Public Finance
Corp., Certificates of
Participation, 5.25%, 5/1/04,
Callable 5/1/00 @ 102............ $ 1,197
500 Apache County, Public Finance
Corp., Certificates of
Participation, 5.50%, 5/1/10,
Callable 5/1/00 @ 102............ 516
1,000 Arizona State University Revenues
Refunding System, Series A,
5.60%, 7/1/05, Callable 7/1/02 @
101.............................. 1,055
1,000 Arizona State University Revenues
System, 6.90%, 7/1/04, Callable
7/1/02 @ 101, AMBAC.............. 1,107
1,950 Arizona State University Revenues,
Series A, 5.85%, 7/1/08, Callable
7/1/02 @ 101..................... 2,064
1,820 Arizona State University Revenues,
Series A, 5.90%, 7/1/09, Callable
7/1/02 @ 101..................... 1,949
725 Casa Grande, Excise Tax Revenue,
5.90%, 4/1/09, Callable 4/1/04 @
100, FGIC........................ 781
750 Central Arizona Water Conservation
District, Contract Revenue,
7.15%, 11/1/99................... 783
1,000 Central Arizona Water Conservation
District, Contract Revenue,
7.65%, 11/1/09, Prerefunded
11/1/00 @ 102.................... 1,101
3,300 Central Arizona Water Conservation
District, Contract Revenue,
7.13%, 11/1/11, Prerefunded
11/1/00 @ 102.................... 3,595
2,875 Central Arizona Water Conservation
District, Contract Revenue,
Central Arizona Project, 4.75%,
11/1/07, Callable 5/1/04 @ 102,
MBIA............................. 2,934
1,460 Central Arizona Water Conservation
District, Contract Revenue,
Central Arizona Project--Series
A, 5.20%, 11/1/03................ 1,529
4,000 Central Arizona Water Conservation
District, Contract Revenue,
Central Arizona Project--Series
A, 5.40%, 11/1/05................ 4,257
4,750 Central Arizona Water Conservation
District, Contract Revenue,
Central Arizona Project--Series
A, 5.40%, 11/1/06................ 5,079
5,000 Chandler, Capital Appreciation, GO,
0.00%, 7/1/07, FGIC.............. 3,329
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 625 Coconino & Yavapai Counties
Arizona, School District #9,
Sedona Oak Creek Project of
1992-C, GO, 5.60%, 7/1/06,
Callable 7/1/02 @ 101, FGIC...... $ 658
2,400 Coconino County, Arizona
University, School District #001,
Flagstaff, GO, 5.50%, 7/1/08,
Callable 7/1/05 @ 101, AMBAC..... 2,567
1,455 Coconino County, Jail Distribution
Revenue, 4.50%, 7/1/12, Callable
7/1/07 @ 101, AMBAC.............. 1,394
2,500 East Valley Institute of
Technology, District #401,
Project of 1994, Series B, GO,
6.00%, 7/1/05, AMBAC............. 2,751
1,000 East Valley Institute of
Technology, District #401, Series
A, GO, 6.00%, 7/1/04, Callable
7/1/00 @ 101, AMBAC.............. 1,048
2,000 Gila County Industrial Development
Authority Revenue, Asarco Inc.,
5.55%, 1/1/27, Callable 1/1/08, @
102.............................. 2,046
1,000 Gilbert Improvement District #011,
GO, 7.60%, 1/1/04, Callable
7/1/98 @ 102.5, FGIC............. 1,039
1,000 Glendale Municipal Property Corp.,
7.00%, 7/1/05, Callable 7/1/99 @
101, MBIA........................ 1,041
1,000 Glendale Municipal Property Corp.,
7.00%, 7/1/09, Callable 7/1/99 @
101, MBIA........................ 1,042
4,000 Glendale University High School,
District #205, Projects of
1993--Series A, GO, 5.30%,
7/1/07, Callable 7/1/03 @ 101.... 4,177
2,900 Glendale University High School,
District #205, Projects of
1993--Series B, GO, 5.45%,
7/1/09, Callable 7/1/05 @ 101,
FGIC............................. 3,071
2,000 Maricopa County, Community College
District, 5.00%, 7/1/13, Callable
7/1/06 @ 101..................... 2,021
1,570 Maricopa County, Community College
District, Building Revenue,
5.10%, 7/15/05, MBIA............. 1,642
1,000 Maricopa County, Community College
District, Series A, 6.00%,
7/1/07, Callable 7/1/03 @ 101.... 1,086
Continued
71
328
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Arizona Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 500 Maricopa County, Industrial
Development Authority, Hospital
Facility Revenue, St. Joseph's
Hospital & Medical Centers
Project, 6.20%, 11/1/11, Putable
11/1/98 @ 100, ETM............... $ 504
1,500 Maricopa County, School District
#001, Phoenix Elementary Project
of 1998--Series A, GO, 5.00%,
7/1/14, Callable 7/1/08 @ 100,
FSA.............................. 1,493
1,000 Maricopa County, School District
#001, Phoenix Elementary, GO,
5.50%, 7/1/10, Callable 7/1/07 @
101, MBIA........................ 1,069
900 Maricopa County, School District
#006, Washington Elementary,
Series A, GO, 5.75%, 7/1/06,
Callable 7/1/02 @ 101, AMBAC..... 963
2,000 Maricopa County, School District
#038, Madison Elementary Project
of 1995--Series B, GO, 5.80%,
7/1/15, Callable 7/1/06 @ 101,
MBIA............................. 2,142
1,015 Maricopa County, School District
#038, Madison Elementary, GO,
5.30%, 7/1/08, Callable 7/1/03 @
101, AMBAC....................... 1,060
1,000 Maricopa County, School District
#097, Deer Valley Project of
1986--Series F, GO, 5.90%,
7/1/03, Callable 7/1/02 @ 101,
FGIC............................. 1,071
750 Maricopa County, School District
#097, Deer Valley Project of
1996--Series C, GO, 5.35%,
7/1/09, Callable 7/1/07 @ 100,
FSA.............................. 792
2,000 Maricopa County, School District
#11, 5.00%, 7/1/09, Callable
7/1/07 @ 101, AMBAC.............. 2,068
2,000 Maricopa County, School District
#210, Phoenix, GO, 5.25%, 7/1/04,
Callable 7/1/03 @ 101............ 2,108
2,000 Maricopa County, School District
#210, Project of 1995 -Series B,
GO, 5.38%, 7/1/13................ 2,077
1,200 Maricopa County, School District
#210, Series A, GO, 5.60%,
7/1/13, Callable 7/1/05 @ 101.... 1,267
1,000 Maricopa County, School District
#210, Series E, GO, 7.10%,
7/1/03........................... 1,130
1,250 Maricopa County, School District
#4, GO, 5.25%, 7/1/03, FGIC...... 1,310
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 2,000 Maricopa County, School District
#4, GO, 5.50%, 7/1/09, Callable
7/1/05 @ 102, FGIC............... $ 2,135
2,500 Maricopa County, School District
#4, GO, 5.00%, 7/1/10, Callable
7/1/06 @ 101, FGIC............... 2,560
750 Maricopa County, School District
#4, GO, 5.65%, 7/1/11, Callable
7/1/05 @ 102, FGIC............... 803
2,500 Maricopa County, School District
#48, Scottsdale School
Improvements, GO, 5.00%, 7/1/14,
Callable 7/1/04 @ 101............ 2,514
1,000 Maricopa County, School District
#48, Scottsdale, GO, 5.20%,
7/1/06, Callable 7/1/03 @ 101.... 1,048
1,475 Maricopa County, School District
#48, Scottsdale, GO, 4.90%,
7/1/06, Callable 7/1/02 @ 101.... 1,520
1,000 Maricopa County, School District
#48, Scottsdale, GO, 5.25%,
7/1/08, Callable 7/1/03 @ 101.... 1,046
1,500 Maricopa County, School District
#48, Scottsdale, GO, 6.75%,
7/1/09, Prerefunded 7/1/01 @
101.............................. 1,629
2,000 Maricopa County, School District
#48, Scottsdale, Series B, GO,
6.10%, 7/1/02.................... 2,149
1,000 Maricopa County, School District
#48, Scottsdale, Series B, GO,
6.30%, 7/1/04.................... 1,110
3,100 Maricopa County, School District
#69, Paradise Valley, GO, 5.80%,
7/1/09, AMBAC.................... 3,451
2,400 Maricopa County, School District
#69, Paradise Valley, GO, 5.00%,
7/1/09, Callable 7/1/03 @ 102,
AMBAC............................ 2,456
1,000 Maricopa County, School District
#69, Paradise Valley, GO, 6.35%,
7/1/10, MBIA..................... 1,165
1,500 Maricopa County, School District
#69, Paradise Valley, Series E,
GO, 4.00%, 7/1/16, Callable
7/1/07 @ 101, FSA................ 1,300
1,000 Maricopa County, School District
#80, Chandler Projects of
1995--Series C, GO, 5.10%,
7/1/08, FGIC..................... 1,056
1,000 Maricopa County, School District
#80, Chandler, GO, 5.80%, 7/1/08,
Callable 7/1/05 @ 101, FGIC...... 1,084
Continued
72
329
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Arizona Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 920 Maricopa County, School District
#9, Wickenburg, GO, 5.50%,
7/1/13, Callable 7/1/07 @ 100,
AMBAC............................ $ 963
2,345 Mesa Arizona Street & Highway,
5.00%, 7/1/15, Callable 7/1/07 @
100, FGIC........................ 2,336
1,625 Mesa, GO, 6.00%, 7/1/02, AMBAC..... 1,739
1,000 Mesa, GO, 5.70%, 7/1/03, FGIC...... 1,068
3,000 Mesa, GO, 5.00%, 7/1/18, Callable
7/1/08 @ 100, FGIC............... 2,953
2,040 Mesa, Project of 1987, GO, 9.00%,
7/1/01, ETM, MBIA................ 2,327
2,000 Mesa, Project of 1987, GO, 5.70%,
7/1/08, Callable 7/1/03 @ 101.5,
MBIA............................. 2,166
2,000 Mesa, Utility System Revenue,
5.38%, 7/1/12, Callable 7/1/05 @
101, FGIC........................ 2,081
1,205 Mohave County, Elementary School
District #16, GO, 5.25%, 7/1/09,
Callable 7/1/07 @ 100, MBIA...... 1,263
1,200 Mohave County, School District # 1,
Lake Havasu, GO, 5.20%, 7/1/09,
Callable 7/1/03 @ 101, AMBAC..... 1,242
1,000 Mohave County, School District #1,
Lake Havasu, GO, 4.75%, 7/1/12,
FGIC............................. 987
2,050 Navajo County, School District #10,
5.13%, 7/1/12, Callable 7/1/07 @
101, FGIC........................ 2,072
1,000 Northern Arizona University,
Revenues, 7.50%, 6/1/03,
Prerefunded 6/1/99 @ 100......... 1,035
2,750 Northern Arizona University,
Revenues, 6.40%, 6/1/07, Callable
6/1/02 @ 101, FGIC............... 2,991
1,535 Northern Arizona University,
Revenues, 5.00%, 6/1/15, Callable
6/1/07 @ 101, FGIC............... 1,529
1,215 Northern Arizona University,
Revenues, Series A, 5.60%,
6/1/05, Callable 6/1/02 @ 102,
AMBAC............................ 1,291
1,000 Oro Valley Municipal Property
Corp., Municipal Water System
Revenue, Canada Hills, 5.45%,
7/1/14, Callable 7/1/08 @ 101,
MBIA............................. 1,050
2,000 Phoenix Arizona Civic Improvement
Corp., Series B, 6.00%, 7/1/08,
Callable 7/1/04 @ 102............ 2,208
2,000 Phoenix Civic Improvement Corp.,
Water System Revenue, 5.63%,
7/1/09, Callable 7/1/06 @ 100.... 2,173
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 725 Phoenix Street & Highway User
Revenue, 6.25%, 7/1/06, Callable
7/1/02 @ 102..................... $ 792
2,000 Phoenix Street & Highway User
Revenue, 6.50%, 7/1/09, ETM...... 2,291
1,255 Phoenix Street & Highway User
Revenue, Series A, 5.80%, 7/1/05,
Callable 7/1/02 @ 102, FGIC...... 1,344
3,950 Phoenix, GO, 6.38%, 7/1/13,
Callable 7/1/02 @ 102............ 4,326
1,125 Phoenix, GO, Series A, 5.10%,
7/1/04........................... 1,180
2,500 Phoenix, GO, Series A, 5.20%,
7/1/05........................... 2,646
1,000 Phoenix, GO, Series A, 5.40%,
7/1/07........................... 1,079
1,000 Phoenix, Individual Development
Authority, Single Family Mortgage
Revenue, Series A, AMT, 5.35%,
6/1/20, Callable 12/1/07 @ 101.5,
GNMA/FNMA/FHLMC.................. 1,004
1,000 Pima County, Arizona College
District, Certificates of
Participation, Series B, 6.00%,
7/1/07, Callable 7/1/01 @ 101,
AMBAC............................ 1,063
725 Pima County, GO, 5.60%, 7/1/07,
Callable 7/1/03 @ 101............ 769
555 Pima County, GO, 6.20%, 7/1/08,
Callable 7/1/02 @ 101............ 600
1,500 Pima County, Industrial Development
Authority, HealthPartners--Series
A, 5.30%, 4/1/07, MBIA........... 1,588
1,000 Pima County, Industrial Development
Authority, Single Family Mortgage
Revenue Refunding, Series B, AMT,
6.15%, 11/1/23, Callable 5/1/07 @
102, GNMA........................ 1,085
1,090 Pima County, Industrial Development
Authority, Single Family Mortgage
Revenue, Series A, 6.40%, 8/1/11,
Callable 8/1/05 @ 102............ 1,161
245 Pima County, Industrial Development
Authority, Single Family Mortgage
Revenue, Series A, 7.63%, 2/1/12,
Callable 2/1/01 @ 101............ 257
1,585 Pima County, Sewer Revenue, Series
A, 4.90%, 7/1/08, Callable 7/1/04
@ 102, FGIC...................... 1,629
Continued
73
330
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Arizona Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 1,000 Pima County, Union School District
#1, Project of 1989 -Series G,
GO, 5.00%, 7/1/06, Callable
7/1/05 @ 101, MBIA............... $ 1,043
2,205 Pima County, Union School District
#1, Project of 1989 -Series G,
GO, 5.00%, 7/1/07, Callable
7/1/05 @ 101, MBIA............... 2,300
1,000 Pima County, Union School District
#1, Series B, GO, 7.20%, 7/1/09,
Prerefunded 7/1/00 @ 101......... 1,072
1,500 Pima County, Union School District
#1, Series C, GO, 6.88%, 7/1/10,
Prerefunded 7/1/01 @ 101, MBIA... 1,635
2,000 Pima County, United School
District, 5.38%, 7/1/09, FGIC.... 2,153
1,200 Pinal County, School District #004,
Casa Grande Elementary School
Improvement, GO, 6.00%, 7/1/04,
Callable 7/1/01 @ 101, AMBAC..... 1,289
1,000 Prescott Property Corp. Facilities,
5.13%, 1/1/18, Callable 1/1/08 @
101, FGIC........................ 998
2,015 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, 6.00%,
1/1/07........................... 2,239
1,270 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, Series
A, 5.40%, 1/1/04................. 1,342
2,000 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, Series
A, 5.63%, 1/1/06................. 2,160
1,000 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, Series
A, 6.50%, 1/1/07, Callable 1/1/01
@ 102............................ 1,075
1,000 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, Series
A, 5.00%, 1/1/20, Callable 1/1/08
@ 101............................ 990
3,250 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, Series
B, 5.20%, 1/1/08................. 3,449
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 2,500 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, Series
B, 5.38%, 1/1/09, Callable 1/1/03
@ 102............................ $ 2,611
3,000 Salt River Project, Agriculture,
Improvement & Power District,
Electric Systems Revenue, Series
D, 6.00%, 1/1/13, Callable 1/1/02
@ 102............................ 3,200
2,815 Santa Cruz County Industrial
Development, Citizens Utility
Co., 4.75%, 8/1/20............... 2,817
2,085 Scottsdale Municipal Property
Corp., Excise Tax Revenue, 5.38%,
7/1/05........................... 2,215
1,000 Scottsdale Municipal Property
Corp., Lease Revenue, Excise Tax
Revenue, 6.38%, 5/1/05, Callable
11/1/02 @ 100.................... 1,086
1,900 Scottsdale Project of 1989, Series
E, GO, 5.50%, 7/1/14, Callable
7/1/02 @ 101..................... 1,965
1,065 Scottsdale Street & Highway User
Revenue, 5.50%, 7/1/07........... 1,150
2,000 Scottsdale Water & Sewer, A989--
Series D, 5.00%, 7/1/19, Callable
7/1/08 @ 101, FSA................ 1,983
1,700 Scottsdale, GO, 5.25%, 7/1/06...... 1,811
500 Scottsdale, GO, 5.50%, 7/1/09...... 545
500 Scottsdale, GO, 5.00%, 7/1/09,
Callable 7/1/03 @ 101............ 515
1,615 Scottsdale, GO, Series A, 4.80%,
7/1/08, Callable 7/1/03 @ 101.... 1,656
2,500 Scottsdale, Industrial Development
Authority, Hospital Revenue,
Scottsdale Memorial Hospitals,
Series A, 6.13%, 9/1/17, Callable
9/1/07 @ 102, AMBAC.............. 2,730
1,000 Show Low, Industrial Development
Authority, Hospital Revenue,
Navapache Regulated Medical
Center, Series A, 5.50%, 12/1/17,
Callable 12/1/07 @ 100, ACA...... 1,011
2,500 State Certificates of
Participation, 6.63%, 9/1/08,
Callable 9/1/01 @ 102, FSA....... 2,731
1,000 State Municipal Financing Program,
Certificates of Participation,
Series 20, 7.70%, 8/1/10, ETM,
BIG.............................. 1,253
Continued
74
331
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Arizona Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 1,000 State Municipal Financing Program,
Certificates of Participation,
Series 27, 7.00%, 8/1/04,
Callable 8/1/98 @ 101, BIG....... $ 1,013
1,250 State Power Authority Resource
Revenue, Hoover Uprating Project,
4.80%, 10/1/01, MBIA............. 1,283
2,035 State Power Authority Resource
Revenue, Hoover Uprating Project,
5.40%, 10/1/07, Callable 10/1/03
@ 102, MBIA...................... 2,156
3,000 State Transportation Board Highway
Revenue, 5.25%, 7/1/07, Callable
7/1/03 @ 102..................... 3,162
1,635 Tempe, GO, 5.00%, 7/1/10, Callable
7/1/06 @ 101..................... 1,681
1,815 Tempe, GO, 4.90%, 7/1/12, Callable
7/1/08 @ 100..................... 1,827
1,000 Tempe, GO, Series A, 5.10%,
7/1/05........................... 1,051
580 Tempe, GO, Series B, 6.00%, 7/1/06,
Callable 7/1/02 @ 101............ 625
2,235 Tempe, Union High School District
#213, Project of 1989--Series B,
GO, 5.90%, 7/1/04, Callable
7/1/01 @ 101 .................... 2,372
2,500 Tucson, 5.00%, 7/1/19, Callable
7/1/07 @ 100..................... 2,489
1,000 Tucson Street & Highway User
Revenue, 5.30%, 7/1/05, Callable
7/1/03 @ 102, MBIA............... 1,058
2,000 Tucson Water Revenue Refunding,
Series A, 5.75%, 7/1/12, Callable
7/1/02 @ 102, MBIA............... 2,131
1,000 Tucson Water System, 5.13%, 7/1/20,
Callable 7/1/07 @ 100............ 992
700 University of Arizona, Foundation
Certificates of Participation,
Series 8, 4.90%, 8/1/09, MBIA.... 725
1,000 University of Arizona, University
Revenues, 6.25%, 6/1/11, Callable
6/1/02 @ 102..................... 1,085
2,250 Water Infrastructure Financial
Authority, Water Quality
Financial Asset, Series A, 5.00%,
7/1/17, Callable 7/1/08 @ 100,
MBIA............................. 2,221
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
MUNICIPAL BONDS, CONTINUED:
Arizona, continued:
$ 1,100 Yavapai County, Industrial
Development Authority, Hospital
Facility Revenue, Yavapai
Regional Medical Center--Series
A, 5.13%, 12/1/13, Callable
6/1/07 @ 102, FSA................ $ 1,112
1,750 Yuma County, GO, 6.13%, 7/1/12,
Callable 7/1/03 @ 101, AMBAC..... 1,921
1,305 Yuma County, GO, Elementary School
District #1, 5.25%, 7/1/10,
Callable 7/1/07 @ 101, MBIA...... 1,366
1,000 Yuma County, Industrial Development
Authority, Hospital Revenue
Refunding, Yuma Regional Medical
Center, 5.50%, 8/1/09, Callable
8/1/07 @ 102, MBIA............... 1,069
1,000 Yuma County, Municipal Property
Corp. Revenue, Series A, 5.20%,
7/1/09, Callable 7/1/03 @ 101,
AMBAC............................ 1,035
1,575 Yuma County, Union High School,
District #70, GO, 5.00%, 7/1/06,
Callable 7/1/02 @ 101, FGIC...... 1,623
--------
244,248
--------
Illinois (0.4%):
845 Du Page County, School District
#041, Glen Ellyn Capital
Appreciation, GO, 0.00%, 2/1/08,
FGIC............................. 542
910 Du Page County, School District
#041, Glen Ellyn Capital
Appreciation, GO, 0.00%, 2/1/09,
FGIC............................. 554
--------
1,096
--------
Tennessee (0.8%):
2,985 Housing Development Agency, Issue
3A, Revenue, GO, AMT, 0.00%,
7/1/06........................... 2,003
--------
Total Municipal Bonds 247,347
--------
INVESTMENT COMPANIES (0.3%):
680 The One Group Municipal Money
Market Fund, Fiduciary Class..... 680
--------
Total Investment Companies 680
--------
Total (Cost $234,848) (a) $248,027
========
Continued
75
332
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Arizona Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
- ------------
Percentages indicated are based on net assets of $250,201.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting in excess of federal income tax reporting of
approximately $17. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $13,284
Unrealized depreciation..................................... (122)
-------
Net unrealized appreciation................................. $13,162
=======
ACA American Capital Access
AMBAC Insured by AMBAC Indemnity Corp.
AMT Alternative Minimum Tax
BIG Insured by Bond Insurance Guarantee
ETM Escrowed to Maturity
FGIC Insured by Federal Guarantee Insurance Corp.
FSA Insured by Federal Security Assurance
GNMA Insured by Government National Mortgage Association
GO General Obligation
MBIA Insured by Municipal Bond Insurance Association
See notes to financial statements.
76
333
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
INTERMEDIATE MUNICIPAL KENTUCKY OHIO
TAX-FREE BOND INCOME MUNICIPAL BOND MUNICIPAL BOND
FUND FUND FUND FUND
--------------- ----------- ---------------- ----------------
ASSETS:
Investments, at value (cost $487,954; $764,609;
$127,271; $180,818; respectively).............. $511,831 $788,318 $135,701 $193,224
Cash............................................. 5 -- -- 3
Interest receivable.............................. 6,855 10,608 2,114 1,989
Receivable from brokers for investments sold..... 9,946 6,035 -- --
Receivable for capital shares issued............. 12 1,561 11 83
Prepaid expenses and other assets................ 3 3 1 2
-------- -------- -------- --------
TOTAL ASSETS..................................... 528,652 806,525 137,827 195,301
-------- -------- -------- --------
LIABILITIES:
Cash overdraft................................... -- 228 -- --
Dividends payable................................ 1,942 3,074 538 766
Payable to brokers for investments purchased..... 12,545 23,797 1,500 1,022
Payable for capital shares redeemed.............. -- 104 1 37
Accrued expenses and other payables:
Investment advisory fees..................... 162 221 40 49
Administration fees.......................... 71 106 19 27
12b-1 fees................................... 7 63 6 23
Other........................................ 65 115 23 52
-------- -------- -------- --------
TOTAL LIABILITIES................................ 14,792 27,708 2,127 1,976
-------- -------- -------- --------
NET ASSETS:
Capital.......................................... 486,040 761,142 128,950 184,798
Undistributed net investment income.............. 233 18 -- 5
Accumulated undistributed net realized gains
(losses) from investment transactions.......... 3,710 (6,052) (1,680) (3,884)
Net unrealized appreciation from investments..... 23,877 23,709 8,430 12,406
-------- -------- -------- --------
NET ASSETS....................................... $513,860 $778,817 $135,700 $193,325
======== ======== ======== ========
NET ASSETS:
Fiduciary.................................... $493,686 $617,885 $122,220 $149,890
Class A...................................... 14,515 101,805 7,899 17,297
Class B...................................... 5,659 56,911 5,581 26,138
Class C...................................... -- 2,216 -- --
-------- -------- -------- --------
Total............................................ $513,860 $778,817 $135,700 $193,325
======== ======== ======== ========
OUTSTANDING UNITS OF BENEFICIAL INTEREST
(SHARES):
Fiduciary.................................... 44,290 61,137 11,750 13,533
Class A...................................... 1,303 10,043 759 1,557
Class B...................................... 508 5,634 539 2,337
Class C...................................... -- 220 -- --
-------- -------- -------- --------
Total............................................ 46,101 77,034 13,048 17,427
======== ======== ======== ========
Net Asset Value:
Fiduciary
Offering and redemption price per
share.................................. $ 11.15 $ 10.11 $ 10.40 $ 11.08
======== ======== ======== ========
Class A
Redemption price per share............... $ 11.14 $ 10.14 $ 10.41 $ 11.11
======== ======== ======== ========
Maximum sales charge..................... 4.50% 4.50% 4.50% 4.50%
======== ======== ======== ========
Maximum offering price per share
(100%/(100%-maximum sales charge) of
net asset value adjusted to nearest
cent).................................. $ 11.66 $ 10.62 $ 10.90 $ 11.63
======== ======== ======== ========
Class B
Offering price per share (a)............. $ 11.16 $ 10.10 $ 10.35 $ 11.18
======== ======== ======== ========
Class C
Offering price per share (a)............. $ -- $ 10.09 $ -- $ --
======== ======== ======== ========
- ------------
(a) Redemption price per Class B and Class C share varies based on length of
time shares are held.
See notes to financial statements.
77
334
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
LOUISIANA WEST VIRGINIA ARIZONA
MUNICIPAL BOND MUNICIPAL BOND MUNICIPAL BOND
FUND FUND FUND
---------------- ---------------- ----------------
ASSETS:
Investments, at value (cost $137,584; $100,248; $234,848;
respectively)............................................. $145,524 $106,770 $248,027
Cash........................................................ -- 12 9
Interest receivable......................................... 2,341 1,447 5,556
Receivable for capital shares issued........................ 76 72 --
Prepaid expenses and other assets........................... 1 1 1
-------- -------- --------
TOTAL ASSETS................................................ 147,942 108,302 253,593
-------- -------- --------
LIABILITIES:
Dividends payable........................................... 563 431 962
Payable to brokers for investments purchased................ 2,023 -- 2,239
Accrued expenses and other payables:
Investment advisory fees................................ 44 33 85
Administration fees..................................... 21 13 34
12b-1 fees.............................................. 14 3 --
Other................................................... 35 33 72
-------- -------- --------
TOTAL LIABILITIES........................................... 2,700 513 3,392
-------- -------- --------
NET ASSETS:
Capital..................................................... 137,009 101,202 234,287
Accumulated undistributed net realized gains (losses) from
investment transactions................................... 293 65 2,735
Net unrealized appreciation from investments................ 7,940 6,522 13,179
-------- -------- --------
NET ASSETS.................................................. $145,242 $107,789 $250,201
======== ======== ========
NET ASSETS:
Fiduciary............................................... $ 92,690 $102,413 $248,590
Class A................................................. 47,078 2,024 1,321
Class B................................................. 5,474 3,352 290
-------- -------- --------
Total................................................... $145,242 $107,789 $250,201
======== ======== ========
OUTSTANDING UNITS OF BENEFICIAL INTEREST (SHARES):
Fiduciary............................................... 9,035 9,966 24,487
Class A................................................. 4,589 195 131
Class B................................................. 534 324 29
-------- -------- --------
Total....................................................... 14,158 10,485 24,647
======== ======== ========
Net Asset Value:
Fiduciary
Offering and redemption price per share............. $ 10.26 $ 10.28 $ 10.15
======== ======== ========
Class A
Redemption price per share.......................... $ 10.26 $ 10.36 $ 10.08
======== ======== ========
Maximum sales charge................................ 4.50% 4.50% 4.50%
======== ======== ========
Maximum offering price per share (100%/(100%-maximum
sales charge) of net asset value adjusted to
nearest cent)..................................... $ 10.74 $ 10.85 $ 10.55
======== ======== ========
Class B
Offering price per share (a)........................ $ 10.26 $ 10.35 $ 10.16
======== ======== ========
- ------------
(a) Redemption price per Class B share varies based on length of time shares are
held.
See notes to financial statements.
78
335
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
INTERMEDIATE MUNICIPAL KENTUCKY OHIO
TAX-FREE BOND INCOME MUNICIPAL BOND MUNICIPAL BOND
FUND FUND FUND FUND
-------------- ---------- ---------------- ----------------
INVESTMENT INCOME:
Interest income........................ $25,820 $35,129 $7,173 $ 9,907
Dividend income........................ 85 138 52 64
------- ------- ------ -------
Total Income........................... 25,905 35,267 7,225 9,971
------- ------- ------ -------
EXPENSES:
Investment advisory fees............... 2,931 2,809 587 1,063
Administration fees.................... 800 1,022 214 290
12b-1 fees (Class A)................... 38 248 22 57
12b-1 fees (Class B)................... 46 460 36 190
12b-1 fees (Class C)................... -- 8 -- --
Custodian and accounting fees.......... 54 87 24 27
Legal and audit fees................... 14 20 6 8
Trustees' fees and expenses............ 6 9 1 2
Transfer agent fees.................... 39 65 31 44
Registration and filing fees........... 98 114 34 34
Printing costs......................... 22 33 5 8
Other.................................. 6 10 2 3
------- ------- ------ -------
Total expenses before waivers.......... 4,054 4,885 962 1,726
Less waivers........................... (1,041) (742) (127) (552)
------- ------- ------ -------
Net Expenses........................... 3,013 4,143 835 1,174
------- ------- ------ -------
Net Investment Income.................. 22,892 31,124 6,390 8,797
------- ------- ------ -------
REALIZED/UNREALIZED GAINS (LOSSES) FROM
INVESTMENTS:
Net realized gains (losses) from
investment transactions.............. 5,307 2,557 119 257
Net change in unrealized appreciation
(depreciation) from investments...... 7,769 12,210 2,318 2,911
------- ------- ------ -------
Net realized/unrealized gains (losses)
from investments..................... 13,076 14,767 2,437 3,168
------- ------- ------ -------
Change in net assets resulting from
operations........................... $35,968 $45,891 $8,827 $11,965
======= ======= ====== =======
See notes to financial statements.
79
336
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
LOUISIANA WEST VIRGINIA ARIZONA
MUNICIPAL BOND MUNICIPAL BOND MUNICIPAL BOND
FUND FUND FUND
---------------- ---------------- ----------------
INVESTMENT INCOME:
Interest income................................ $8,410 $5,716 $13,821
Dividend income................................ 20 42 63
------ ------ -------
Total Income................................... 8,430 5,758 13,884
------ ------ -------
EXPENSES:
Investment advisory fees....................... 928 469 1,162
Administration fees............................ 253 171 423
12b-1 fees (Class A)........................... 170 4 4
12b-1 fees (Class B)........................... 43 15 --
Custodian and accounting fees.................. 22 20 22
Legal and audit fees........................... 7 6 7
Trustees' fees and expenses.................... 2 1 2
Transfer agent fees............................ 42 31 18
Registration and filing fees................... 25 47 65
Printing costs................................. 7 4 8
Other.......................................... 3 2 4
------ ------ -------
Total expenses before waivers.................. 1,502 770 1,715
Less waivers................................... (409) (131) (184)
------ ------ -------
Net Expenses................................... 1,093 639 1,531
------ ------ -------
Net Investment Income.......................... 7,337 5,119 12,353
------ ------ -------
REALIZED/UNREALIZED GAINS (LOSSES) FROM
INVESTMENTS:
Net realized gains (losses) from investment
transactions................................. 968 126 3,573
Net change in unrealized appreciation
(depreciation) from investments.............. 1,590 2,009 550
------ ------ -------
Net realized/unrealized gains (losses) from
investments.................................. 2,558 2,135 4,123
------ ------ -------
Change in net assets resulting from
operations................................... $9,895 $7,254 $16,476
====== ====== =======
See notes to financial statements.
80
337
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
INTERMEDIATE MUNICIPAL KENTUCKY
TAX-FREE BOND INCOME MUNICIPAL BOND
FUND FUND FUND
------------------- ------------------- -------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
-------- -------- -------- -------- -------- --------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income................................... $22,892 $16,901 $31,124 $20,002 $ 6,390 $ 3,914
Net realized gains (losses) from investment
transactions.......................................... 5,307 1,738 2,557 (530) 119 16
Net change in unrealized appreciation (depreciation)
from investments...................................... 7,769 5,870 12,210 7,608 2,318 1,197
-------- -------- -------- -------- -------- --------
Change in net assets resulting from operations.............. 35,968 24,509 45,891 27,080 8,827 5,127
-------- -------- -------- -------- -------- --------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income.............................. (22,232) (16,473) (25,751) (17,054) (5,949) (3,488)
From net realized gains from investment transactions.... (3,217) (414) -- -- -- --
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income.............................. (487) (322) (3,418) (1,627) (293) (346)
From net realized gains from investment transactions.... (68) (11) -- -- -- --
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income.............................. (173) (106) (1,923) (1,321) (148) (80)
From net realized gains from investment transactions.... (31) (4) -- -- -- --
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net investment income.............................. -- -- (32) -- -- --
-------- -------- -------- -------- -------- --------
Change in net assets from shareholder distributions......... (26,208) (17,330) (31,124) (20,002) (6,390) (3,914)
-------- -------- -------- -------- -------- --------
CAPITAL TRANSACTIONS:
Proceeds from shares issued............................. 122,240 103,061 323,602 194,651 27,438 19,089
Proceeds from shares issued in conversion............... -- 182,568 46,179 55,269 -- 78,683
Dividends reinvested.................................... 2,765 603 4,009 2,256 314 244
Cost of shares redeemed................................. (83,758) (56,820) (96,404) (62,696) (19,272) (14,381)
-------- -------- -------- -------- -------- --------
Change in net assets from share transactions................ 41,247 229,412 277,386 189,480 8,480 83,635
-------- -------- -------- -------- -------- --------
Change in net assets........................................ 51,007 236,591 292,153 196,558 10,917 84,848
NET ASSETS:
Beginning of period..................................... 462,853 226,262 486,664 290,106 124,783 39,935
-------- -------- -------- -------- -------- --------
End of period........................................... $513,860 $462,853 $778,817 $486,664 $135,700 $124,783
======== ======== ======== ======== ======== ========
SHARE TRANSACTIONS:
Issued.................................................. 11,002 9,528 32,215 19,945 2,650 1,892
Issued in conversion.................................... -- 16,858 4,581 5,680 -- 7,752
Reinvested.............................................. 249 56 399 231 30 24
Redeemed................................................ (7,543) (5,252) (9,602) (6,436) (1,862) (1,415)
-------- -------- -------- -------- -------- --------
Change in shares............................................ 3,708 21,190 27,593 19,420 818 8,253
======== ======== ======== ======== ======== ========
See notes to financial statements.
81
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
OHIO LOUISIANA
MUNICIPAL BOND MUNICIPAL BOND
FUND FUND
------------------- -------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
-------- -------- -------- --------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income................................... $ 8,797 $ 6,661 $ 7,337 $ 8,667
Net realized gains (losses) from investment
transactions.......................................... 257 (175) 968 (79)
Net change in unrealized appreciation (depreciation)
from investments...................................... 2,911 2,389 1,590 3,224
-------- -------- -------- --------
Change in net assets resulting from operations.............. 11,965 8,875 9,895 11,812
-------- -------- -------- --------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income.............................. (7,209) (5,336) (4,929) (6,174)
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income.............................. (794) (810) (2,237) (2,349)
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income.............................. (794) (515) (171) (144)
-------- -------- -------- --------
Change in net assets from shareholder distributions......... (8,797) (6,661) (7,337) (8,667)
-------- -------- -------- --------
CAPITAL TRANSACTIONS:
Proceeds from shares issued............................. 57,251 39,896 15,023 10,148
Proceeds from shares issued in conversion............... -- 39,137 -- --
Dividends reinvested.................................... 1,266 1,160 1,558 1,612
Cost of shares redeemed................................. (31,962) (24,777) (39,568) (41,977)
-------- -------- -------- --------
Change in net assets from share transactions................ 26,555 55,416 (22,987) (30,217)
-------- -------- -------- --------
Change in net assets........................................ 29,723 57,630 (20,429) (27,072)
NET ASSETS:
Beginning of period..................................... 163,602 105,972 165,671 192,743
-------- -------- -------- --------
End of period........................................... $193,325 $163,602 $145,242 $165,671
======== ======== ======== ========
SHARE TRANSACTIONS:
Issued.................................................. 5,175 3,691 1,468 1,013
Issued in conversion.................................... -- 3,617 -- --
Reinvested.............................................. 114 107 152 161
Redeemed................................................ (2,889) (2,289) (3,865) (4,190)
-------- -------- -------- --------
Change in shares............................................ 2,400 5,126 (2,245) (3,016)
======== ======== ======== ========
See notes to financial statements.
82
339
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
WEST VIRGINIA ARIZONA
MUNICIPAL BOND MUNICIPAL BOND
FUND FUND
---------------------- ----------------------
JANUARY 17, JANUARY 17,
YEAR 1997 YEAR 1997
ENDED THROUGH ENDED THROUGH
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997(A) 1998 1997(A)
-------- ------- -------- --------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income................................... $ 5,119 $ 2,113 $12,353 $ 5,890
Net realized gains (losses) from investment
transactions.......................................... 126 (28) 3,573 982
Net change in unrealized appreciation (depreciation)
from investments...................................... 2,009 627 550 511
-------- ------- -------- --------
Change in net assets resulting from operations.............. 7,254 2,712 16,476 7,383
-------- ------- -------- --------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income.............................. (4,999) (2,097) (12,296) (5,879)
From net realized gains from investment transactions.... (33) -- (1,813) --
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income.............................. (60) (11) (56) (11)
From net realized gains from investment transactions.... --(b) -- (7) --
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income.............................. (60) (5) (1) --(b)
From net realized gains from investment transactions.... --(b) -- --(b) --
-------- ------- -------- --------
Change in net assets from shareholder distributions......... (5,152) (2,113) (14,173) (5,890)
-------- ------- -------- --------
CAPITAL TRANSACTIONS:
Proceeds from shares issued............................. 23,999 10,842 34,060 11,134
Proceeds from shares issued in conversion............... -- 91,179 -- 263,882
Dividends reinvested.................................... 114 9 41 5
Cost of shares redeemed................................. (16,118) (4,937) (43,458) (19,259)
-------- ------- -------- --------
Change in net assets from share transactions................ 7,995 97,093 (9,357) 255,762
-------- ------- -------- --------
Change in net assets........................................ 10,097 97,692 (7,054) 257,255
NET ASSETS:
Beginning of period..................................... 97,692 -- 257,255 --
-------- ------- -------- --------
End of period........................................... $107,789 $97,692 $250,201 $257,255
======== ======= ======== ========
SHARE TRANSACTIONS:
Issued.................................................. 2,345 1,081 3,350 1,116
Issued in conversion.................................... -- 9,118 -- 26,388
Reinvested.............................................. 11 1 4 1
Redeemed................................................ (1,579) (492) (4,282) (1,930)
-------- ------- -------- --------
Change in shares............................................ 777 9,708 (928) 25,575
======== ======= ======== ========
- ------------
(a) Period from commencement of operations.
(b) Amount less than $1,000.
See notes to financial statements.
83
340
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS JUNE 30, 1998
1. ORGANIZATION:
The One Group (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end investment company
established as a Massachusetts business trust. The accompanying financial
statements and financial highlights are those of the Intermediate Tax-Free
Bond Fund, the Municipal Income Fund, the Kentucky Municipal Bond Fund, the
Ohio Municipal Bond Fund, the Louisiana Municipal Bond Fund, the West
Virginia Municipal Bond Fund, and the Arizona Municipal Bond Fund,
(individually a "Fund", collectively the "Funds") only. Each Fund is a
non-diversified mutual fund, except for the Intermediate Tax-Free Bond Fund
and the Municipal Income Fund, which are diversified.
The Funds' investment objectives are as follows:
FUND OBJECTIVE
---- ---------
Intermediate Tax-Free Bond Fund Current income exempt from Federal income taxes
consistent with prudent investment management and the
preservation of capital.
Municipal Income Fund Current income exempt from Federal income taxes.
Kentucky Municipal Bond Fund Current income exempt from Federal income tax and
Kentucky personal income tax consistent with the
preservation of principal.
Ohio Municipal Bond Fund Current income exempt from Federal income tax and Ohio
personal income tax consistent with the preservation of
principal.
Louisiana Municipal Bond Fund Current income both consistent with the preservation of
principal and exempt from Federal income tax and
Louisiana income tax.
West Virginia Municipal Bond Fund Current income exempt from Federal income tax and West
Virginia personal income tax consistent with the
preservation of principal.
Arizona Municipal Bond Fund Current income exempt from Federal income tax and Arizona
personal income tax consistent with the preservation of
principal.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for the
period. Actual results could differ from those estimates.
SECURITY VALUATION
Debt securities (other than short-term investments maturing in 60 days or
less), including municipal securities, are valued on the basis of valuations
provided by dealers or by an independent pricing service approved by the
Board of Trustees. Short-term investments maturing in 60 days or less are
valued at amortized cost, which approximates market value. Futures contracts
are valued at the settlement price established each day by the board of trade
or an exchange on which they are traded. Options traded on an exchange are
valued using the last sale price or, in the absence of a sale, the last
offering price. Options traded over-the-counter are valued using
dealer-supplied valuations. Investments for which there are no
Continued
84
341
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
such quotations or valuations are valued at fair value as determined in good
faith by the Fair Value Committee, which is comprised of members from Banc
One Investment Advisors Corporation (the "Advisor") and the The One Group
Services Company (the "Administrator"), under the direction of the Board of
Trustees.
REPURCHASE AGREEMENTS
The Funds may invest in repurchase agreements with institutions that are
deemed by the Advisor to be of good standing and creditworthy under
guidelines established by the Board of Trustees. Each repurchase agreement is
recorded at cost. The Fund requires that the securities purchased in a
repurchase agreement transaction be transferred to the custodian in a manner
sufficient to enable the Fund to obtain those securities in the event of a
counterparty default. The seller, under the repurchase agreement, is required
to maintain the value of the securities held at not less than the repurchase
price, including accrued interest. Repurchase agreements are considered to be
loans by a fund under the 1940 Act.
WRITTEN OPTIONS
The Funds may write covered call or secured put options for which premiums
received are recorded as liabilities and are subsequently adjusted to the
current value of the options written. Premiums received from writing options
which expire are treated as realized gains. Premiums received from writing
options, which are either exercised or closed, are offset against the
proceeds received or amount paid on the transaction to determine realized
gains or losses.
FUTURES CONTRACTS
The Funds may enter into futures contracts for the delayed delivery of
securities at a fixed price at some future date or for the change in the
value of a specified financial index over a predetermined time period. Cash
or securities are deposited with brokers in order to maintain a position.
Subsequent payments made or received by the Fund based on the daily change in
the market value of the position are recorded as unrealized appreciation or
depreciation until the contract is closed out, at which time the appreciation
or depreciation is realized.
INDEXED SECURITIES
The Funds may invest in indexed securities whose value is linked either
directly or inversely to changes in foreign currencies, interest rates,
commodities, indices or other reference instruments. Indexed securities may
be more volatile than the referenced instrument itself, but any loss is
limited to the amount of the original investment.
SECURITIES LENDING
To generate additional income, the Funds may lend up to 33% of securities
in which they are invested pursuant to agreements requiring that the loan be
continuously secured by cash, U.S. Government or U.S. Government Agency
securities, shares of an investment trust or mutual fund, or any combination
of cash and such securities as collateral equal at all times to at least 100%
of the market value plus accrued interest on the securities lent. The Funds
continue to earn interest on securities lent while simultaneously seeking to
earn interest on the investment of collateral. Collateral is marked to market
daily to provide a level of collateral at least equal to the market value of
securities lent. There may be risks of delay in recovery of the securities or
even loss of rights in the collateral should the borrower of the securities
fail financially. However, loans will be made only to borrowers deemed by the
Advisor to be of good standing and creditworthy under guidelines established
by the Board of Trustees and when, in the judgment of the Advisor, the
consideration which can be earned currently from such securities loans
justifies the attendant
Continued
85
342
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
risks. Loans are subject to termination by the Funds or the borrower at any
time, and are, therefore, not considered to be illiquid investments. As of
June 30, 1998 the Funds had no securities on loan.
SECURITY TRANSACTIONS AND RELATED INCOME
Security transactions are accounted for on a trade date basis. Net realized
gains or losses from sales of securities are determined on the specific
identification cost method. Interest income and expenses are recognized on
the accrual basis. Dividends are recorded on the ex-dividend date. Interest
income, including any discount or premium, is accrued as earned using the
effective interest method.
EXPENSES
Expenses directly attributable to a Fund are charged directly to that Fund,
while the expenses which are attributable to more than one fund of the Trust
are allocated among the respective Funds. Each class of shares bears its
pro-rata portion of expenses attributable to its series, except that each
class separately bears expenses related specifically to that class, such as
distribution fees.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income are declared daily and paid monthly for
the Funds. Net realized capital gains, if any, are distributed at least
annually. Dividends are declared separately for each class. No class has
preferential dividend rights; differences in per share dividend rates are due
to differences in separate class expenses.
Distributions from net investment income and from net 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 for mortgage-backed securities, expiring capital loss
carryforwards, and deferrals of certain losses. Permanent book and tax basis
differences have been reclassified among the components of net assets.
FEDERAL INCOME TAXES
The Trust treats each Fund as a separate entity for Federal income tax
purposes. Each Fund intends to continue to qualify as a regulated investment
company by complying with the provisions available to certain investment
companies as defined in applicable sections of the Internal Revenue Code, and
to make distributions from net investment income and from net realized
capital gains sufficient to relieve it from all, or substantially all,
Federal income taxes.
3. SHARES OF BENEFICIAL INTEREST:
The Trust has an unlimited number of shares of beneficial interest, with no
par value, which may, without shareholder approval, be divided into an
unlimited number of series of such shares and any series may be classified or
reclassified into one or more classes. The Trust is registered to offer forty
series and five classes of shares: Fiduciary Class, Class A, Class B, Class C
and Service Class. Currently, the Trust consists of thirty-three active
funds. The Funds are each authorized to issue Fiduciary Class, Class A, Class
B, and Class C Shares. Class A Shares are subject to initial sales charges,
imposed at the time of purchase, in accordance with the Funds' prospectus.
Certain redemptions of Class B and Class C Shares are subject to contingent
deferred sales charges in accordance with the Funds' prospectus. As of June
30, 1998, there were no shareholders in Class C of the Funds except for the
Municipal Income Fund. Shareholders are entitled to one vote for each full
share held and will vote in the aggregate and not by class or series, except
as otherwise expressly required by law or when the Board of Trustees has
determined that the matter to be voted on affects only the interest of
shareholders of a particular class or series. The following is a summary of
transactions in Fund shares for the fiscal years ended June 30, 1998 and
1997:
Continued
86
343
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The One Group Family of Mutual Funds
-----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
INTERMEDIATE TAX-FREE MUNICIPAL INCOME KENTUCKY MUNICIPAL
BOND FUND FUND BOND FUND
------------------------ ------------------------ ------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997
----------- ---------- ----------- ---------- ----------- ----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued.............. $111,699 $ 98,433 $220,026 $155,470 $ 21,000 $ 17,564
Proceeds from shares issued in
conversion............................. -- 182,568 46,179 55,269 -- 78,683
Dividends reinvested..................... 2,191 267 44 198 11 11
Cost of shares redeemed.................. (80,781) (54,356) (69,016) (49,425) (17,905) (10,777)
-------- -------- -------- -------- -------- --------
Change in net assets from Fiduciary Share
transactions........................... $ 33,109 $226,912 $197,233 $161,512 $ 3,106 $ 85,481
======== ======== ======== ======== ======== ========
CLASS A SHARES:
Proceeds from shares issued.............. $ 7,828 $ 2,964 $ 77,150 $ 24,091 $ 3,088 $ 425
Dividends reinvested..................... 408 245 2,621 1,160 217 191
Cost of shares redeemed.................. (2,369) (1,518) (21,365) (9,801) (1,062) (3,370)
-------- -------- -------- -------- -------- --------
Change in net assets from Class A Share
transactions........................... $ 5,867 $ 1,691 $ 58,406 $ 15,450 $ 2,243 $ (2,754)
======== ======== ======== ======== ======== ========
CLASS B SHARES:
Proceeds from shares issued.............. $ 2,713 $ 1,664 $ 24,239 $ 15,090 $ 3,350 $ 1,100
Dividends reinvested..................... 166 91 1,319 898 86 42
Cost of shares redeemed.................. (608) (946) (6,014) (3,470) (305) (234)
-------- -------- -------- -------- -------- --------
Change in net assets from Class B Share
transactions........................... $ 2,271 $ 809 $ 19,544 $ 12,518 $ 3,131 $ 908
======== ======== ======== ======== ======== ========
CLASS C SHARES: (A)
Proceeds from shares issued.............. 2,187
Dividends reinvested..................... 25
Cost of shares redeemed.................. (9)
========
Change in net assets from Class C Shares
transactions........................... $ 2,203
========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued................................... 10,053 9,103 21,915 15,939 2,029 1,740
Issued in conversion..................... -- 16,858 4,581 5,680 -- 7,752
Reinvested............................... 197 25 4 20 1 1
Redeemed................................. (7,275) (5,024) (6,882) (5,078) (1,730) (1,061)
-------- -------- -------- -------- -------- --------
Change in Fiduciary Shares............... 2,975 20,962 19,618 16,561 300 8,432
======== ======== ======== ======== ======== ========
CLASS A SHARES:
Issued................................... 705 272 7,666 2,459 297 42
Reinvested............................... 37 23 260 119 21 19
Redeemed................................. (214) (141) (2,120) (1,002) (103) (331)
-------- -------- -------- -------- -------- --------
Change in Class A Shares................. 528 154 5,806 1,576 215 (270)
======== ======== ======== ======== ======== ========
CLASS B SHARES:
Issued................................... 244 153 2,416 1,547 324 110
Reinvested............................... 15 8 132 92 8 4
Redeemed................................. (54) (87) (599) (356) (29) (23)
-------- -------- -------- -------- -------- --------
Change in Class B Shares................. 205 74 1,949 1,283 303 91
======== ======== ======== ======== ======== ========
CLASS C SHARES: (A)
Issued................................... 218
Reinvested............................... 3
Redeemed................................. (1)
========
Change in Class C Shares................. 220
========
- ------------
(a) Period from commencement of operations November 4, 1997.
Continued
87
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
OHIO MUNICIPAL LOUISIANA MUNICIPAL
BOND FUND BOND FUND
----------------------- -----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
---------- ---------- ---------- ----------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued............................... $ 37,277 $ 28,385 $ 7,654 $ 5,386
Proceeds issued in conversion............................. -- 39,137 -- --
Dividends reinvested...................................... 41 93 7 --
Cost of shares redeemed................................... (23,179) (16,829) (30,030) (30,290)
-------- -------- -------- --------
Change in net assets from Fiduciary Share transactions.... $ 14,139 $ 50,786 $(22,369) $(24,904)
======== ======== ======== ========
CLASS A SHARES:
Proceeds from shares issued............................... $ 5,696 $ 5,044 $ 5,295 $ 4,042
Dividends reinvested...................................... 637 675 1,436 1,510
Cost of shares redeemed................................... (5,438) (6,371) (8,929) (11,414)
-------- -------- -------- --------
Change in net assets from Class A Share transactions...... $ 895 $ (652) $ (2,198) $ (5,862)
======== ======== ======== ========
CLASS B SHARES:
Proceeds from shares issued............................... $ 14,278 $ 6,467 $ 2,074 $ 720
Dividends reinvested...................................... 588 392 115 102
Cost of shares redeemed................................... (3,345) (1,577) (609) (273)
-------- -------- -------- --------
Change in net assets from Class B Share transactions...... $ 11,521 $ 5,282 $ 1,580 $ 549
======== ======== ======== ========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued.................................................... 3,381 2,635 747 538
Issued in conversion...................................... -- 3,617 -- --
Reinvested................................................ 4 9 1 --
Redeemed.................................................. (2,097) (1,556) (2,934) (3,023)
-------- -------- -------- --------
Change in Fiduciary Shares................................ 1,288 4,705 (2,186) (2,485)
======== ======== ======== ========
CLASS A SHARES:
Issued.................................................... 513 464 519 403
Reinvested................................................ 57 62 140 151
Redeemed.................................................. (491) (588) (872) (1,140)
-------- -------- -------- --------
Change in Class A Shares.................................. 79 (62) (213) (586)
======== ======== ======== ========
CLASS B SHARES:
Issued.................................................... 1,281 592 202 72
Reinvested................................................ 53 36 11 10
Redeemed.................................................. (301) (145) (59) (27)
-------- -------- -------- --------
Change in Class B Shares.................................. 1,033 483 154 55
======== ======== ======== ========
Continued
88
345
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
WEST VIRGINIA MUNICIPAL BOND FUND ARIZONA MUNICIPAL BOND FUND
--------------------------------- ------------------------------
JANUARY 17, 1997 JANUARY 17, 1997
YEAR ENDED THROUGH YEAR ENDED THROUGH
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997(A) 1998 1997(A)
----------- ------------------ ---------- -----------------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued................... $ 19,752 $ 9,442 $ 32,085 $ 9,187
Proceeds from shares issued in conversion..... -- 91,179 -- 263,882
Dividends reinvested.......................... 38 --(b) -- --
Cost of shares redeemed....................... (15,715) (4,937) (41,541) (18,791)
-------- ------- -------- --------
Change in net assets from Fiduciary Share
transactions................................ $ 4,075 $95,684 $ (9,456) $254,278
======== ======= ======== ========
CLASS A SHARES:
Proceeds from shares issued................... $ 1,552 $ 795 $ 1,686 $ 1,947
Dividends reinvested.......................... 48 7 41 5
Cost of shares redeemed....................... (398) -- (1,917) (468)
-------- ------- -------- --------
Change in net assets from Class A Share
transactions................................ $ 1,202 $ 802 $ (190) $ 1,484
======== ======= ======== ========
CLASS B SHARES:
Proceeds from shares issued................... $ 2,695 $ 605 $ 289 $ --(b)
Dividends reinvested.......................... 28 2 -- --
Cost of shares redeemed....................... (5) -- -- --
-------- ------- -------- --------
Change in net assets from Class B Share
transactions................................ $ 2,718 $ 607 $ 289 $ --(b)
======== ======= ======== ========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued........................................ 1,933 941 3,154 920
Issued in conversion.......................... -- 9,118 -- 26,388
Reinvested.................................... 4 1 -- --
Redeemed...................................... (1,539) (492) (4,092) (1,883)
-------- ------- -------- --------
Change in Fiduciary Shares.................... 398 9,568 (938) 25,425
======== ======= ======== ========
CLASS A SHARES:
Issued........................................ 150 79 167 196
Reinvested.................................... 5 -- 4 1
Redeemed...................................... (39) -- (190) (47)
-------- ------- -------- --------
Change in Class A Shares...................... 116 79 (19) 150
======== ======= ======== ========
CLASS B SHARES:
Issued........................................ 262 61 29 --(b)
Reinvested.................................... 2 -- -- --
Redeemed...................................... (1) -- -- --
-------- ------- -------- --------
Change in Class B Shares...................... 263 61 29 --(b)
======== ======= ======== ========
- ------------
(a) Period from commencement of operations.
(b) Amount is less than 1,000.
Continued
89
346
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
4. INVESTMENT ADVISORY, ADMINISTRATIVE, AND DISTRIBUTION AGREEMENTS:
The Trust and the Advisor are parties to an investment advisory agreement
under which the Advisor is entitled to receive an annual fee, computed daily
and paid monthly, equal to the following percentages of the Funds' average
net assets: 0.60% of the Intermediate Tax-Free Bond Fund, the Ohio Municipal
Bond Fund and the Louisiana Municipal Bond Fund; and 0.45% of the Municipal
Income Fund, the Kentucky Municipal Bond Fund, the West Virginia Municipal
Bond Fund and the Arizona Municipal Bond Fund.
The Trust and the Administrator, a wholly-owned subsidiary of The BISYS
Group, Inc., are parties to an administrative agreement under which the
Administrator provides services for a fee that is computed daily and paid
monthly, at an annual rate of 0.20% on the first $1.5 billion of Trust net
assets (excluding the Investor Growth Fund, the Investor Growth & Income
Fund, the Investor Conservative Fund, and the Investor Balanced Fund, the
"Investor Funds" and the Treasury Only Money Market Fund and the Government
Money Market Fund, the "Institutional Money Market Funds"); 0.18% on the next
$0.5 billion of Trust net assets (excluding the Investor Funds and the
Institutional Money Market Funds); and 0.16% of Trust net assets (excluding
the Investor Funds and the Institutional Money Market Funds) over $2 billion.
The Advisor also serves as Sub-Administrator to each fund of the Trust,
pursuant to an agreement between the Administrator and the Advisor. Pursuant
to this agreement, the Advisor performs many of the Administrator's duties,
for which the Advisor receives a fee paid by the Administrator.
The Trust and The One Group Services Company (the "Distributor") are parties
to a distribution agreement under which shares of the Funds are sold on a
continuous basis. Class A, Class B, and Class C Shares are subject to
distribution and shareholder services plans (the "Plans") pursuant to Rule
12b-1 under the 1940 Act. As provided in the Plans, the Trust will pay the
Distributor a fee of 0.35% of the average daily net assets of Class A Shares
of each of the Funds and 1.00% of the average daily net assets of the Class B
and Class C Shares of each of the Funds. Currently, the Distributor has
voluntarily agreed to limit payments under the Plans to 0.25%, 0.90% and
0.90% of average daily net assets of the Class A , Class B and Class C
Shares, respectively, of each Fund. Up to 0.25% of the fees payable under the
Plans may be used as compensation for shareholder services by the Distributor
and/or financial institutions and intermediaries. Fees paid under the Plans
may be applied by the Distributor toward (i) compensation for its services in
connection with distribution assistance or provision of shareholder services;
or (ii) payments to financial institutions and intermediaries such as banks
(including affiliates of the Advisor), brokers, dealers and other
institutions, including the Distributor's affiliates and subsidiaries as
compensation for services or reimbursement of expenses incurred in connection
with distribution assistance or provision of shareholder services. Fiduciary
Class Shares of each Fund are offered without distribution fees. For the year
ended June 30, 1998, the Distributor received $2,573,908 from commissions
earned on sales of Class A Shares and redemptions of Class B and Class C
Shares, of which the Distributor reallowed $2,569,574 to affiliated
broker/dealers of the Funds.
Certain officers of the Trust are affiliated with the Administrator. Such
officers receive no compensation from the Funds for serving in their
respective roles.
Continued
90
347
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
The Advisor, the Administrator and the Distributor voluntarily agreed to
waive a portion of their fees. For the year ended June 30, 1998, fees in the
following amounts were waived (amounts in thousands):
12B-1 FEES
INVESTMENT WAIVED
ADVISORY FEES ADMINISTRATION ------------------------------
WAIVED FEES WAIVED CLASS A CLASS B CLASS C
------------- --------------- -------- -------- --------
Intermediate Tax-Free Bond Fund... $1,026 $-- $11 $ 4 $--
Municipal Income Fund............. 624 -- 71 46 1
Kentucky Municipal Bond Fund...... 117 -- 6 4 --
Ohio Municipal Bond Fund.......... 517 -- 16 19 --
Louisiana Municipal Bond Fund..... 356 -- 49 4 --
West Virginia Municipal Bond
Fund............................ 104 25 1 1 --
Arizona Municipal Bond Fund....... 155 28 1 -- --
5. SECURITIES TRANSACTIONS:
The cost of security purchases and the proceeds from the sale of securities
(excluding short-term securities and purchased options) during the year ended
June 30, 1998 were as follows (amounts in thousands):
PURCHASES SALES
--------- --------
Intermediate Tax-Free Bond Fund....................... $574,646 $539,941
Municipal Income Fund................................. 667,809 418,288
Kentucky Municipal Bond Fund.......................... 16,577 7,445
Ohio Municipal Bond Fund.............................. 47,866 18,285
Louisiana Municipal Bond Fund......................... 18,508 39,598
West Virginia Municipal Bond Fund..................... 25,215 17,123
Arizona Municipal Bond Fund........................... 53,187 65,164
6. FINANCIAL INSTRUMENTS:
Investing in financial instruments such as written options, futures,
structured notes and indexed securities involves risks in excess of the
amounts reflected in the Statement of Assets and Liabilities. The face or
contract amounts reflect the extent of the involvement the Funds have in the
particular class of instrument. Risks associated with these instruments
include an imperfect correlation between the movements in the price of the
instruments and the price of the underlying securities and interest rates, an
illiquid secondary market for the instruments or inability of counterparties
to perform under the terms of the contract. The Funds enter into these
contracts primarily as a means to hedge against adverse fluctuation in
securities.
7. CONCENTRATION OF CREDIT RISK:
The Kentucky, Ohio, Louisiana, Arizona and West Virginia Municipal Bond Funds
invest primarily in debt obligations issued by the respective States and
their political subdivisions, agencies and public authorities to obtain funds
for various public purposes. The Funds are more susceptible to economic and
political factors adversely affecting issuers of the state's specific
municipal securities than are municipal bond funds that are not concentrated
in these issuers to the same extent.
8. CONVERSION OF COMMON TRUST FUNDS:
On December 19, 1997, the net assets of certain common trust funds managed by
the Advisor were exchanged in a tax-free conversion for shares of the
corresponding One Group Funds. The transaction was accounted for by a method
followed for tax purposes in a tax-free business combination. The following
is a summary of shares
Continued
91
348
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- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
issued, net assets converted, net asset value per share issued and unrealized
appreciation of assets acquired as of the conversion date (amounts in
thousands except per share amounts):
NET ASSET
NET VALUE PER
ASSETS SHARES UNREALIZED
SHARES CONVERTED ISSUED APPRECIATION
------ ---------- ------------- ------------
Municipal Income Fund.......................... 4,581 $ 46,179 $10.08 $ 1,820
On January 20, 1997, the net assets of certain common trust funds managed by
the Advisor were exchanged in a tax-free conversion for shares of the
corresponding One Group Funds. The transaction was accounted for by a method
followed for tax purposes in a tax-free business combination. The following
is a summary of shares issued, net assets converted, net asset value per
share issued and unrealized appreciation of assets acquired as of the
conversion date (amounts in thousands except per share amounts):
NET ASSET
NET VALUE PER
ASSETS SHARES UNREALIZED
SHARES CONVERTED ISSUED APPRECIATION
------ ---------- ------------- ------------
Intermediate Tax-Free Bond Fund..................... 16,858 $182,568 $10.83 $ 7,412
Municipal Income Fund............................... 5,680 55,269 9.73 1,784
Kentucky Municipal Bond Fund........................ 7,752 78,683 10.15 4,545
Ohio Municipal Bond Fund............................ 3,617 39,137 10.82 2,826
West Virginia Municipal Bond Fund................... 9,118 91,179 10.00 3,886
Arizona Municipal Bond Fund......................... 26,388 263,882 10.00 12,118
9. FEDERAL TAX INFORMATION:
The accompanying table below details distributions from long-term capital
gains for the following funds for the fiscal year ended June 30, 1998
(amounts in thousands):
20% 28%
DISTRIBUTIONS DISTRIBUTIONS
------------- -------------
Intermediate Tax-Free Bond Fund........................... $ 725 $ 507
West Virginia Municipal Bond Fund......................... 19 --
Arizona Municipal Bond Fund............................... 1,265 519
Continued
92
349
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- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
At June 30, 1998, the following Funds have capital loss carry forwards which
are available to offset future capital gains, if any (amounts in thousands):
CAPITAL LOSS
CARRYFORWARD EXPIRES
------------ -------
Municipal Income Fund................................. $3,424 2003
Municipal Income Fund................................. 2,561 2005
Kentucky Municipal Bond Fund.......................... 1,197 2003
Kentucky Municipal Bond Fund.......................... 483 2004
Ohio Municipal Bond Fund.............................. 2,166 2003
Ohio Municipal Bond Fund.............................. 1,463 2004
Ohio Municipal Bond Fund.............................. 217 2005
The Funds designate the following exempt-interest dividends for the taxable
year ended June 30, 1998 (amounts in thousands):
TAX-EXEMPT
DISTRIBUTION
------------
Intermediate Tax-Free Bond Fund............................. $22,760
Municipal Income Fund....................................... 29,900
Kentucky Municipal Bond Fund................................ 6,321
Ohio Municipal Bond Fund.................................... 8,682
Louisiana Municipal Bond Fund............................... 7,435
West Virginia Municipal Bond Fund........................... 5,008
Arizona Municipal Bond Fund................................. 12,399
10. SUBSEQUENT EVENTS:
On May 21, 1998, the Board of Trustees approved an agreement and plan of
reorganization and liquidation ("the Plan") with the Marquis Family of Funds
(the "Marquis Funds"). Under the Plan, the assets and liabilities of each
Marquis fund were transferred to a comparable One Group fund. Shares of the
comparable One Group fund were distributed to the Marquis shareholders in a
complete liquidation of each Marquis fund. A special Shareholder Meeting to
approve the plan was held on July 30, 1998. In a tax-free exchange on August
10, 1998, $51,579,111 of the Marquis Louisiana Tax-Free Income Fund net
assets were exchanged for 5,037,023 shares of the One Group Louisiana
Municipal Bond Fund.
93
350
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- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERMEDIATE TAX-FREE BOND FUND
----------------------------------------------------------------
FIDUCIARY
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD................ $ 10.92 $ 10.67 $ 10.64 $ 10.49 $ 11.15
-------- -------- -------- -------- --------
Investment Activities:
Net investment income............................. 0.52 0.54 0.52 0.54 0.52
Net realized and unrealized gains (losses) from
investments..................................... 0.31 0.27 0.04 0.15 (0.52)
-------- -------- -------- -------- --------
Total from Investment Activities................ 0.83 0.81 0.56 0.69 0.00
-------- -------- -------- -------- --------
Distributions:
Net investment income............................. (0.52) (0.54) (0.51) (0.54) (0.53)
In excess of net investment income................ -- -- -- -- (0.01)
Net realized gains................................ (0.08) (0.02) (0.02) -- (0.01)
In excess of net realized gains................... -- -- -- -- (0.11)
-------- -------- -------- -------- --------
Total Distributions............................. (0.60) (0.56) (0.53) (0.54) (0.66)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD...................... $ 11.15 $ 10.92 $ 10.67 $ 10.64 $ 10.49
======== ======== ======== ======== ========
Total Return........................................ 7.74% 7.76% 5.39% 6.75% (0.11)%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)................. $493,686 $451,089 $217,201 $211,229 $182,611
Ratio of expenses to average net assets........... 0.60% 0.58% 0.54% 0.53% 0.48%
Ratio of net investment income to average net
assets.......................................... 4.70% 5.05% 4.87% 5.17% 4.78%
Ratio of expenses to average net assets*.......... 0.81% 0.81% 0.87% 0.88% 0.84%
Ratio of net investment income to average net
assets*......................................... 4.49% 4.82% 4.54% 4.82% 4.42%
Portfolio turnover (a)............................ 109.03% 86.89% 111.58% 199.76% 105.98%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
94
351
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- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERMEDIATE TAX-FREE BOND FUND
-----------------------------------------------------------
CLASS A
-----------------------------------------------------------
YEAR ENDED JUNE 30,
-----------------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE, BEGINNING OF PERIOD..................... $ 10.91 $ 10.67 $ 10.63 $ 10.48 $ 11.14
------- ------- ------- ------- -------
Investment Activities:
Net investment income.................................. 0.50 0.51 0.50 0.51 0.50
Net realized and unrealized gains (losses) from
investments.......................................... 0.31 0.26 0.05 0.15 (0.52)
------- ------- ------- ------- -------
Total from Investment Activities..................... 0.81 0.77 0.55 0.66 (0.02)
------- ------- ------- ------- -------
Distributions:
Net investment income.................................. (0.50) (0.51) (0.49) (0.49) (0.52)
In excess of net investment income..................... -- -- -- (0.02) (0.01)
Net realized gains..................................... (0.08) (0.02) (0.02) -- --
In excess of net realized gains........................ -- -- -- -- (0.11)
------- ------- ------- ------- -------
Total Distributions.................................. (0.58) (0.53) (0.51) (0.51) (0.64)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD........................... $ 11.14 $ 10.91 $ 10.67 $ 10.63 $ 10.48
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)..................... 7.50% 7.39% 5.28% 6.49% (0.33)%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)...................... $14,515 $ 8,457 $ 6,622 $ 5,614 $ 5,556
Ratio of expenses to average net assets................ 0.85% 0.83% 0.79% 0.78% 0.73%
Ratio of net investment income to average net assets... 4.45% 4.75% 4.62% 4.91% 4.57%
Ratio of expenses to average net assets*............... 1.16% 1.15% 1.22% 1.23% 1.19%
Ratio of net investment income to average net
assets*.............................................. 4.14% 4.43% 4.19% 4.46% 4.11%
Portfolio turnover (a)................................. 109.03% 86.89% 111.58% 199.76% 105.98%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
95
352
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- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERMEDIATE TAX-FREE BOND FUND
------------------------------------------------------------
CLASS B
------------------------------------------------------------
YEAR ENDED JUNE 30,
------------------------------------------------------------
1998 1997 1996 1995 1994(A)
------- ------- ------- ------- --------
NET ASSET VALUE, BEGINNING OF PERIOD..................... $ 10.93 $ 10.68 $ 10.65 $ 10.50 $ 11.18
------- ------- ------- ------- -------
Investment Activities:
Net investment income.................................. 0.43 0.45 0.43 0.46 0.17
Net realized and unrealized gains (losses) from
investments.......................................... 0.31 0.27 0.04 0.14 (0.67)
------- ------- ------- ------- -------
Total from Investment Activities..................... 0.74 0.72 0.47 0.60 (0.50)
------- ------- ------- ------- -------
Distributions:
Net investment income.................................. (0.43) (0.45) (0.42) (0.45) (0.17)
Net realized gains..................................... (0.08) (0.02) (0.02) -- --
In excess of net realized gains........................ -- -- -- -- (0.01)
------- ------- ------- ------- -------
Total Distributions.................................. (0.51) (0.47) (0.44) (0.45) (0.18)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD........................... $ 11.16 $ 10.93 $ 10.68 $ 10.65 $ 10.50
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)..................... 6.81% 6.82% 4.48% 5.89% (4.48)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)...................... $ 5,659 $ 3,307 $ 2,439 $ 1,116 $ 549
Ratio of expenses to average net assets................ 1.50% 1.47% 1.44% 1.43% 1.40%(c)
Ratio of net investment income to average net assets... 3.80% 4.09% 3.97% 4.29% 4.08%(c)
Ratio of expenses to average net assets*............... 1.81% 1.78% 1.87% 1.88% 1.85%(c)
Ratio of net investment income to average net
assets*.............................................. 3.49% 3.78% 3.54% 3.84% 3.63%(c)
Portfolio turnover (d)................................. 109.03% 86.89% 111.58% 199.76% 105.98%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Class B Shares commenced offering on January 14, 1994.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
96
353
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
MUNICIPAL INCOME FUND
----------------------------------------------------------------
FIDUCIARY
----------------------------------------------------------------
YEAR ENDED JUNE 30,
----------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE, BEGINNING OF PERIOD................ $ 9.84 $ 9.66 $ 9.69 $ 9.66 $ 10.11
-------- -------- -------- -------- --------
Investment Activities:
Net investment income............................. 0.51 0.53 0.56 0.57 0.56
Net realized and unrealized gains (losses) from
investments..................................... 0.27 0.18 (0.03) 0.03 (0.42)
-------- -------- -------- -------- --------
Total from Investment Activities................ 0.78 0.71 0.53 0.60 0.14
-------- -------- -------- -------- --------
Distributions:
Net investment income............................. (0.51) (0.53) (0.56) (0.57) (0.56)
Net realized gains................................ -- -- -- -- (0.03)
-------- -------- -------- -------- --------
Total Distributions............................. (0.51) (0.53) (0.56) (0.57) (0.59)
-------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD...................... $ 10.11 $ 9.84 $ 9.66 $ 9.69 $ 9.66
======== ======== ======== ======== ========
Total Return........................................ 8.09% 7.49% 5.54% 6.46% 1.36%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)................. $617,885 $408,577 $241,115 $185,916 $152,763
Ratio of expenses to average net assets........... 0.57% 0.57% 0.56% 0.56% 0.54%
Ratio of net investment income to average net
assets.......................................... 5.08% 5.38% 5.70% 6.02% 5.61%
Ratio of expenses to average net assets*.......... 0.67% 0.68% 0.76% 0.74% 0.71%
Ratio of net investment income to average net
assets*......................................... 4.98% 5.27% 5.50% 5.84% 5.44%
Portfolio turnover (a)............................ 69.76% 62.83% 83.17% 66.02% 101.48%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
97
354
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
MUNICIPAL INCOME FUND
------------------------------------------------------------
CLASS A
------------------------------------------------------------
YEAR ENDED JUNE 30,
------------------------------------------------------------
1998 1997 1996 1995 1994
-------- ------- ------- ------- -------
NET ASSET VALUE, BEGINNING OF PERIOD.................... $ 9.87 $ 9.69 $ 9.72 $ 9.67 $ 10.12
-------- ------- ------- ------- -------
Investment Activities:
Net investment income................................. 0.49 0.51 0.55 0.55 0.55
Net realized and unrealized gains (losses)
from investments.................................... 0.27 0.18 (0.04) 0.05 (0.43)
-------- ------- ------- ------- -------
Total from Investment Activities.................... 0.76 0.69 0.51 0.60 0.12
-------- ------- ------- ------- -------
Distributions:
Net investment income................................. (0.49) (0.51) (0.54) (0.55) (0.54)
Net realized gains.................................... -- -- -- -- (0.03)
-------- ------- ------- ------- -------
Total Distributions................................. (0.49) (0.51) (0.54) (0.55) (0.57)
-------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD.......................... $ 10.14 $ 9.87 $ 9.69 $ 9.72 $ 9.67
======== ======= ======= ======= =======
Total Return (Excludes Sales Charge).................... 7.84% 7.24% 5.35% 6.21% 1.34%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)..................... $101,805 $41,829 $25,787 $11,462 $10,725
Ratio of expenses to average net assets............... 0.82% 0.82% 0.81% 0.81% 0.79%
Ratio of net investment income to average net
assets.............................................. 4.83% 5.13% 5.45% 5.76% 5.44%
Ratio of expenses to average net assets*.............. 1.02% 1.03% 1.11% 1.09% 1.06%
Ratio of net investment income to average net
assets*............................................. 4.63% 4.92% 5.15% 5.48% 5.17%
Portfolio turnover (a)................................ 69.76% 62.83% 83.17% 66.02% 101.48%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
98
355
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- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
MUNICIPAL INCOME FUND
------------------------------------------------------------
CLASS B
------------------------------------------------------------
YEAR ENDED JUNE 30,
------------------------------------------------------------
1998 1997 1996 1995 1994(A)
------- ------- ------- ------- --------
NET ASSET VALUE, BEGINNING OF PERIOD..................... $ 9.84 $ 9.66 $ 9.69 $ 9.62 $ 10.10
------- ------- ------- ------- -------
Investment Activities:
Net investment income.................................. 0.42 0.44 0.47 0.49 0.24
Net realized and unrealized gains (losses) from
investments.......................................... 0.26 0.18 (0.03) 0.07 (0.48)
------- ------- ------- ------- -------
Total from Investment Activities..................... 0.68 0.62 0.44 0.56 (0.24)
------- ------- ------- ------- -------
Distributions:
Net investment income.................................. (0.42) (0.44) (0.47) (0.49) (0.24)
------- ------- ------- ------- -------
Total Distributions.................................. (0.42) (0.44) (0.47) (0.49) (0.24)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD........................... $ 10.10 $ 9.84 $ 9.66 $ 9.69 $ 9.62
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)..................... 7.04% 6.55% 4.65% 5.58% (1.98)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)...................... $56,911 $36,258 $23,204 $ 8,326 $ 4,855
Ratio of expenses to average net assets................ 1.47% 1.47% 1.46% 1.46% 1.41%(c)
Ratio of net investment income to average net assets... 4.18% 4.48% 4.80% 5.14% 4.95%(c)
Ratio of expenses to average net assets*............... 1.67% 1.67% 1.76% 1.74% 1.62%(c)
Ratio of net investment income to average net
assets*.............................................. 3.98% 4.28% 4.50% 4.86% 4.74%(c)
Portfolio turnover (d)................................. 69.76% 62.83% 83.17% 66.02% 101.48%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Class B Shares commenced offering on January 14, 1994.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
99
356
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- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
MUNICIPAL
INCOME FUND
------------
CLASS C
------------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(A)
------------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 9.96
------
Investment Activities:
Net investment income..................................... 0.68
Net realized and unrealized gains (losses) from
investments 0.13
------
Total from Investment Activities....................... 0.81
------
Distributions:
Net investment income..................................... (0.68)
------
Total Distributions.................................... (0.68)
------
NET ASSET VALUE, END OF PERIOD.............................. $10.09
======
Total Return (Excludes Sales Charge)........................ 8.28%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $2,216
Ratio of expenses to average net assets................... 1.47%(c)
Ratio of net investment income to average net assets...... 4.18%(c)
Ratio of expenses to average net assets*.................. 1.67%(c)
Ratio of net investment income to average net assets*..... 3.98%(c)
Portfolio turnover (d).................................... 69.76%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
100
357
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The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
KENTUCKY MUNICIPAL BOND FUND
-------------------------------------------------------------------------------
FIDUCIARY
----------------------------------------------
JANUARY 20, FEBRUARY 1, MARCH 12,
YEAR ENDED JUNE 30, 1995 TO 1994, TO 1993, TO
------------------------------- JUNE 30, JANUARY 19, JANUARY 31,
1998 1997 1996 1995(A) 1995(B) 1994(B)(C)
-------- -------- ------- ----------- ------------ -------------
NET ASSET VALUE,
BEGINNING OF PERIOD................ $ 10.20 $ 10.04 $ 9.92 $ 9.49 $ 10.45 $ 10.00
-------- -------- ------- ------- ------- -------
Investment Activities:
Net investment income.............. 0.51 0.50 0.50 0.20 0.41 0.36
Net realized and unrealized gains
(losses) from investments........ 0.20 0.16 0.12 0.43 (0.95) 0.43
-------- -------- ------- ------- ------- -------
Total from Investment
Activities.................... 0.71 0.66 0.62 0.63 (0.54) 0.79
-------- -------- ------- ------- ------- -------
Distributions:
Net investment income.............. (0.51) (0.50) (0.50) (0.20) (0.42) (0.34)
-------- -------- ------- ------- ------- -------
Total Distributions.............. (0.51) (0.50) (0.50) (0.20) (0.42) (0.34)
-------- -------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD...................... $ 10.40 $ 10.20 $ 10.04 $ 9.92 $ 9.49 $ 10.45
======== ======== ======= ======= ======= =======
Total Return......................... 7.11% 6.74% 6.35% 6.56%(d) (5.17)%(d) 8.05%(d)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period
(000)............................ $122,220 $116,830 $30,300 $32,520 $41,953 $64,663
Ratio of expenses to average
net assets....................... 0.60% 0.59% 0.68% 0.65%(e) 1.03% (e) 0.70%(e)
Ratio of net investment income to
average net assets............... 4.94% 5.12% 4.60% 4.70%(e) 4.27% (e) 4.19%(e)
Ratio of expenses to average net
assets*.......................... 0.69% 0.72% 1.02% 0.97%(e) 1.05% (e) 0.91%(e)
Ratio of net investment income to
average net assets*.............. 4.85% 4.99% 4.26% 4.38%(e) 4.25% (e) 3.98%(e)
Portfolio turnover (f)............. 5.81% 13.30% 16.78% 19.75% 10.00% 5.00%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from date reorganized as a fund of The One Group.
(b) Prior to reorganizing as a fund of The One Group, the Fund offered only one
class of shares.
(c) Period from commencement of operations.
(d) Not annualized.
(e) Annualized.
(f) Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing among the classes of shares issued.
See notes to financial statements.
101
358
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
KENTUCKY MUNICIPAL BOND FUND
---------------------------------------------
CLASS A
---------------------------------------------
JANUARY 20,
YEAR ENDED JUNE 30, 1995 TO
---------------------------- JUNE 30,
1998 1997 1996 1995(A)
------- ------ ------- -------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.21 $10.05 $ 9.93 $ 9.49
------- ------ ------- -------
Investment Activities:
Net investment income..................................... 0.49 0.48 0.44 0.19
Net realized and unrealized gains (losses) from
investments............................................. 0.20 0.16 0.12 0.44
------- ------ ------- -------
Total from Investment Activities........................ 0.69 0.64 0.56 0.63
------- ------ ------- -------
Distributions:
Net investment income..................................... (0.49) (0.48) (0.44) (0.19)
------- ------ ------- -------
Total Distributions..................................... (0.49) (0.48) (0.44) (0.19)
------- ------ ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.41 $10.21 $ 10.05 $ 9.93
======= ====== ======= =======
Total Return (Excludes Sales Charge)........................ 6.86% 6.46% 5.70% 5.66%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 7,899 $5,554 $ 8,178 $ 8,818
Ratio of expenses to average net assets................... 0.85% 0.84% 0.93% 0.90%(c)
Ratio of net investment income to average net assets...... 4.69% 4.66% 4.35% 4.44%(c)
Ratio of expenses to average net assets*.................. 1.04% 1.04% 1.37% 1.33%(c)
Ratio of net investment income to average net assets*..... 4.50% 4.46% 3.91% 4.01%(c)
Portfolio turnover (d).................................... 5.81% 13.30% 16.78% 19.75%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from date reorganized as a fund of The One Group.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
102
359
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
KENTUCKY MUNICIPAL BOND FUND
----------------------------------------------
CLASS B
----------------------------------------------
MARCH 16,
YEAR ENDED JUNE 30, 1995 TO
----------------------------- JUNE 30,
1998 1997 1996 1995(A)
------- ------- ------- -------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.15 $ 9.99 $ 9.87 $ 9.75
------- ------- ------- -------
Investment Activities:
Net investment income..................................... 0.42 0.41 0.38 0.14
Net realized and unrealized gains (losses) from
investments............................................. 0.20 0.16 0.13 0.12
------- ------- ------- -------
Total from Investment Activities........................ 0.62 0.57 0.51 0.26
------- ------- ------- -------
Distributions:
Net investment income..................................... (0.42) (0.41) (0.39) (0.14)
------- ------- ------- -------
Total Distributions..................................... (0.42) (0.41) (0.39) (0.14)
------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.35 $ 10.15 $ 9.99 $ 9.87
======= ======= ======= =======
Total Return (Excludes Sales Charge)........................ 6.20% 5.81% 5.16% 2.63%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 5,581 $ 2,399 $ 1,457 $ 79
Ratio of expenses to average net assets................... 1.51% 1.47% 1.58% 1.58%(c)
Ratio of net investment income to average net assets...... 4.04% 4.05% 3.70% 3.89%(c)
Ratio of expenses to average net assets*.................. 1.70% 1.70% 2.02% 2.21%(c)
Ratio of net investment income to average net
assets*................................................. 3.85% 3.82% 3.26% 3.25%(c)
Portfolio turnover (d).................................... 5.81% 13.30% 16.78% 19.75%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
103
360
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
OHIO MUNICIPAL BOND FUND
-------------------------------------------------------------
FIDUCIARY
-------------------------------------------------------------
YEAR ENDED JUNE 30,
-------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- ------- ------- -------
NET ASSET VALUE, BEGINNING OF PERIOD................... $ 10.88 $ 10.69 $ 10.65 $ 10.58 $ 11.11
-------- -------- ------- ------- -------
Investment Activities:
Net investment income................................ 0.56 0.56 0.56 0.55 0.51
Net realized and unrealized gains (losses) from
investments........................................ 0.20 0.19 0.04 0.07 (0.50)
-------- -------- ------- ------- -------
Total from Investment Activities................... 0.76 0.75 0.60 0.62 0.01
-------- -------- ------- ------- -------
Distributions:
Net investment income................................ (0.56) (0.56) (0.56) (0.55) (0.52)
In excess of net realized gains...................... -- -- -- -- (0.02)
-------- -------- ------- ------- -------
Total Distributions................................ (0.56) (0.56) (0.56) (0.55) (0.54)
-------- -------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD......................... $ 11.08 $ 10.88 $ 10.69 $ 10.65 $ 10.58
======== ======== ======= ======= =======
Total Return........................................... 7.13% 7.22% 5.69% 6.07% 0.07%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000).................... $149,890 $133,172 $80,611 $79,993 $93,261
Ratio of expenses to average net assets.............. 0.54% 0.54% 0.57% 0.58% 0.53%
Ratio of net investment income to average net
assets............................................. 5.09% 5.24% 5.17% 5.29% 4.76%
Ratio of expenses to average net assets*............. 0.83% 0.84% 0.95% 0.91% 0.86%
Ratio of net investment income to average net
assets*............................................ 4.80% 4.94% 4.79% 4.96% 4.43%
Portfolio turnover (a)............................... 10.49% 7.45% 24.61% 77.69% 16.77%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
104
361
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
OHIO MUNICIPAL BOND FUND
-----------------------------------------------------------
CLASS A
-----------------------------------------------------------
YEAR ENDED JUNE 30,
-----------------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE, BEGINNING OF PERIOD..................... $ 10.91 $ 10.72 $ 10.68 $ 10.61 $ 11.13
------- ------- ------- ------- -------
Investment Activities:
Net investment income.................................. 0.54 0.54 0.55 0.53 0.50
Net realized and unrealized gains (losses) from
investments.......................................... 0.20 0.19 0.03 0.07 (0.48)
------- ------- ------- ------- -------
Total from Investment Activities..................... 0.74 0.73 0.58 0.60 0.02
------- ------- ------- ------- -------
Distributions:
Net investment income.................................. (0.54) (0.54) (0.54) (0.51) (0.50)
In excess of net investment income..................... -- -- -- (0.02) (0.02)
In excess of net realized gains........................ -- -- -- -- (0.02)
------- ------- ------- ------- -------
Total Distributions.................................. (0.54) (0.54) (0.54) (0.53) (0.54)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD........................... $ 11.11 $ 10.91 $ 10.72 $ 10.68 $ 10.61
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)..................... 6.87% 6.95% 5.44% 5.79% (0.05)%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)...................... $17,297 $16,114 $16,507 $12,006 $14,883
Ratio of expenses to average net assets................ 0.79% 0.79% 0.82% 0.82% 0.78%
Ratio of net investment income to average net assets... 4.83% 4.96% 4.92% 5.01% 4.63%
Ratio of expenses to average net assets*............... 1.18% 1.19% 1.30% 1.25% 1.21%
Ratio of net investment income to average net
assets*.............................................. 4.44% 4.56% 4.44% 4.58% 4.20%
Portfolio turnover (a)................................. 10.49% 7.45% 24.61% 77.69% 16.77%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
105
362
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
OHIO MUNICIPAL BOND FUND
-----------------------------------------------------------------
CLASS B
-----------------------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
---------------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(A)
------- ------- ------- ------- -------------
NET ASSET VALUE, BEGINNING OF PERIOD................ $ 10.98 $ 10.79 $ 10.75 $ 10.68 $ 11.31
------- ------- ------- ------- -------
Investment Activities:
Net investment income............................. 0.47 0.47 0.48 0.43 0.17
Net realized and unrealized gains (losses) from
investments..................................... 0.20 0.19 0.03 0.07 (0.62)
------- ------- ------- ------- -------
Total from Investment Activities................ 0.67 0.66 0.51 0.50 (0.45)
------- ------- ------- ------- -------
Distributions:
Net investment income............................. (0.47) (0.47) (0.47) (0.43) (0.17)
In excess of net investment income................ -- -- -- -- (0.01)
------- ------- ------- ------- -------
Total Distributions............................. (0.47) (0.47) (0.47) (0.43) (0.18)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD...................... $ 11.18 $ 10.98 $ 10.79 $ 10.75 $ 10.68
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)................ 6.20% 6.26% 4.79% 5.17% (4.02)%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)................. $26,138 $14,316 $ 8,854 $ 3,209 $ 2,043
Ratio of expenses to average net assets........... 1.44% 1.44% 1.47% 1.48% 1.28% (c)
Ratio of net investment income to average net
assets.......................................... 4.19% 4.33% 4.27% 4.40% 4.23% (c)
Ratio of expenses to average net assets*.......... 1.83% 1.84% 1.95% 1.91% 1.68% (c)
Ratio of net investment income to average net
assets*......................................... 3.80% 3.93% 3.79% 3.97% 3.83% (c)
Portfolio turnover (d)............................ 10.49% 7.45% 24.61% 77.69% 16.77%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
106
363
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LOUISIANA MUNICIPAL BOND FUND
-----------------------------------
FIDUCIARY
-----------------------------------
MARCH
26, 1996
YEAR ENDED JUNE 30, THROUGH
--------------------- JUNE 30,
1998 1997 1996(A)
------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.10 $ 9.93 $ 10.00
------- -------- --------
Investment Activities:
Net investment income..................................... 0.50 0.49 0.13
Net realized and unrealized gains (losses) from
investments............................................ 0.16 0.17 (0.07)
------- -------- --------
Total from Investment Activities....................... 0.66 0.66 0.06
------- -------- --------
Distributions:
Net investment income..................................... (0.50) (0.49) (0.13)
------- -------- --------
Total Distributions.................................... (0.50) (0.49) (0.13)
------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.26 $ 10.10 $ 9.93
======= ======== ========
Total Return................................................ 6.62% 6.81% 0.90%(b)(c)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $92,690 $113,338 $136,041
Ratio of expenses to average net assets................... 0.60% 0.62% 0.71%(d)
Ratio of net investment income to average net assets...... 4.85% 4.91% 4.76%(d)
Ratio of expenses to average net assets*.................. 0.83% 0.84% 0.86%(d)
Ratio of net investment income to average net assets*..... 4.62% 4.69% 4.61%(d)
Portfolio turnover (e).................................... 12.03% 17.39% 16.72%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from date reorganized as a fund of The One Group.
(b) Not annualized.
(c) Represents total return for Class A Shares from December 1, 1995 through
March 25, 1996 plus total return for Fiduciary Shares for the period March
26, 1996 through June 30, 1996.
(d) Annualized.
(e) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
107
364
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LOUISIANA MUNICIPAL BOND FUND
---------------------------------------------------------------------------
CLASS A
---------------------------------------------------------------------------
SEVEN MONTHS
YEAR ENDED JUNE 30, ENDED YEAR ENDED NOVEMBER 30,
--------------------- JUNE 30, ----------------------------------
1998 1997 1996(A) 1995 1994 1993
------- ------- ------------ -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD................. $ 10.10 $ 9.93 $ 10.09 $ 9.38 $ 10.27 $ 9.92
------- ------- ------- -------- -------- --------
Investment Activities:
Net investment income............... 0.47 0.47 0.24 0.50 0.49 0.52
Net realized and unrealized gains
(losses) from investments......... 0.16 0.17 (0.16) 0.71 (0.79) 0.42
------- ------- ------- -------- -------- --------
Total from Investment
Activities..................... 0.63 0.64 0.08 1.21 (0.30) 0.94
------- ------- ------- -------- -------- --------
Distributions:
Net investment income............... (0.47) (0.47) (0.24) (0.50) (0.49) (0.52)
Net realized gains.................. -- -- -- -- (0.10) (0.07)
------- ------- ------- -------- -------- --------
Total Distributions............... (0.47) (0.47) (0.24) (0.50) (0.59) (0.59)
------- ------- ------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD........ $ 10.26 $ 10.10 $ 9.93 $ 10.09 $ 9.38 $ 10.27
======= ======= ======= ======== ======== ========
Total Return (Excludes Sales
Charge)............................. 6.35% 6.55% 0.84%(b) 13.11% (2.97)% 9.65%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)... $47,078 $48,498 $53,479 $206,119 $196,820 $196,534
Ratio of expenses to average
net assets........................ 0.85% 0.87% 0.69%(c) 0.62% 0.65% 0.62%
Ratio of net investment income to
average net assets................ 4.60% 4.66% 4.71%(c) 5.07% 4.97% 5.07%
Ratio of expenses to average net
assets*........................... 1.18% 1.19% 0.86%(c) 0.77% 0.80% 0.78%
Ratio of net investment income to
average net assets*............... 4.27% 4.34% 4.54%(c) 4.92% 4.82% 4.91%
Portfolio turnover (d).............. 12.03% 17.39% 16.72% 28.00% 24.00% 25.00%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Upon reorganizing as a fund of The One Group, the Paragon Louisiana Tax-Free
Fund became the Louisiana Municipal Bond Fund. Financial highlights for the
periods prior to March 26, 1996 represents the Paragon Louisiana Tax-Free
Fund. The per share data for the periods prior to March 26, 1996 have been
restated to reflect the impact of restatement of net asset value from $10.67
to $10.00 effective March 26, 1996.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
108
365
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LOUISIANA MUNICIPAL BOND FUND
------------------------------------------------------------------------
CLASS B
------------------------------------------------------------------------
SEVEN MONTHS YEAR SEPTEMBER 16,
YEAR ENDED JUNE 30, ENDED ENDED 1994 THROUGH
----------------------- JUNE 30, NOVEMBER 30, NOVEMBER 30,
1998 1997 1996(A) 1995 1994(B)
------- ------- ------------ ------------ -------------
NET ASSET VALUE,
BEGINNING OF PERIOD..................... $ 10.10 $ 9.93 $ 10.09 $ 9.36 $ 9.73
------- ------- ------- ------- -------
Investment Activities:
Net investment income................... 0.41 0.40 0.21 0.42 0.08
Net realized and unrealized gains
(losses)
from investments...................... 0.16 0.17 (0.16) 0.73 (0.37)
------- ------- ------- ------- -------
Total from Investment Activities...... 0.57 0.57 0.05 1.15 (0.29)
------- ------- ------- ------- -------
Distributions:
Net investment income................... (0.41) (0.40) (0.21) (0.42) (0.08)
------- ------- ------- ------- -------
Total Distributions................... (0.41) (0.40) (0.21) (0.42) (0.08)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD............ $ 10.26 $ 10.10 $ 9.93 $ 10.09 $ 9.36
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)...... 5.69% 5.87% 0.48%(c) 12.52% (2.94)%(c)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)....... $ 5,474 $ 3,835 $ 3,223 $ 2,115 $ 204
Ratio of expenses to average net
assets................................ 1.50% 1.51% 1.50%(d) 1.37% 1.41% (d)
Ratio of net investment income to
average net assets.................... 3.95% 4.02% 3.98%(d) 4.27% 4.45% (d)
Ratio of expenses to average net
assets*............................... 1.83% 1.85% 1.70%(d) 1.52% 1.56% (d)
Ratio of net investment income to
average net assets*................... 3.62% 3.68% 3.78%(d) 4.12% 4.30% (d)
Portfolio turnover (e).................. 12.03% 17.39% 16.72% 28.00% 24.00%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Upon reorganizing as a fund of The One Group, the Paragon Louisiana Tax-Free
Fund became the Louisiana Municipal Bond Fund. Financial highlights for the
periods prior to March 26, 1996 represents the Paragon Louisiana Tax-Free
Fund. The per share data for the periods prior to March 26, 1996 have been
restated to reflect the impact of restatement of net asset value from $10.70
to $10.00 effective March 26, 1996.
(b) Period from commencement of operations.
(c) Not annualized.
(d) Annualized.
(e) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
109
366
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
WEST VIRGINIA MUNICIPAL BOND FUND
-----------------------------------
FIDUCIARY
-----------------------------------
YEAR JANUARY 20, 1997
ENDED THROUGH
JUNE 30, JUNE 30,
1998 1997(A)
-------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.06 $ 10.00
-------- -------
Investment Activities:
Net investment income..................................... 0.50 0.22
Net realized and unrealized gains (losses) from
investments............................................. 0.22 0.06
-------- -------
Total from Investment Activities........................ 0.72 0.28
-------- -------
Distributions:
Net investment income..................................... (0.50) (0.22)
-------- -------
Total Distributions..................................... (0.50) (0.22)
-------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.28 $ 10.06
======== =======
Total Return................................................ 7.36% 2.84%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $102,413 $96,270
Ratio of expenses to average net assets................... 0.60% 0.59%(c)
Ratio of net investment income to average net assets...... 4.93% 5.04%(c)
Ratio of expenses to average net assets*.................. 0.72% 0.67%(c)
Ratio of net investment income to average net assets*..... 4.81% 4.96%(c)
Portfolio turnover (d).................................... 16.69% 6.21%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
110
367
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
WEST VIRGINIA MUNICIPAL BOND FUND
-----------------------------------
CLASS A
-----------------------------------
YEAR JANUARY 20, 1997
ENDED THROUGH
JUNE 30, JUNE 30,
1998 1997(A)
------- -------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 10.15 $ 10.00
------- -------
Investment Activities:
Net investment income..................................... 0.48 0.16
Net realized and unrealized gains (losses) from
investments............................................. 0.21 0.15
------- -------
Total from Investment Activities........................ 0.69 0.31
------- -------
Distributions:
Net investment income..................................... (0.48) (0.16)
------- -------
Total Distributions..................................... (0.48) (0.16)
------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.36 $ 10.15
======= =======
Total Return (Excludes Sales Charge)........................ 6.98% 3.08%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 2,024 $ 808
Ratio of expenses to average net assets................... 0.85% 0.84%(c)
Ratio of net investment income to average net assets...... 4.68% 4.94%(c)
Ratio of expenses to average net assets*.................. 1.07% 0.97%(c)
Ratio of net investment income to average net assets*..... 4.46% 4.81%(c)
Portfolio turnover (d).................................... 16.69% 6.21%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
111
368
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
WEST VIRGINIA MUNICIPAL BOND FUND
-----------------------------------
CLASS B
-----------------------------------
YEAR JANUARY 20, 1997
ENDED THROUGH
JUNE 30, JUNE 30,
1998 1997(A)
------ -------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $10.12 $ 10.00
------ -------
Investment Activities:
Net investment income..................................... 0.42 0.14
Net realized and unrealized gains (losses) from
investments............................................. 0.23 0.12
------ -------
Total from Investment Activities........................ 0.65 0.26
------ -------
Distributions:
Net investment income..................................... (0.42) (0.14)
------ -------
Total Distributions..................................... (0.42) (0.14)
------ -------
NET ASSET VALUE,
END OF PERIOD............................................. $10.35 $ 10.12
====== =======
Total Return (Excludes Sales Charge)........................ 6.57% 2.64%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $3,352 $ 614
Ratio of expenses to average net assets................... 1.50% 1.49%(c)
Ratio of net investment income to average net assets...... 4.05% 4.08%(c)
Ratio of expenses to average net assets*.................. 1.72% 1.62%(c)
Ratio of net investment income to average net assets*..... 3.83% 3.95%(c)
Portfolio turnover (d).................................... 16.69% 6.21%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
112
369
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ARIZONA MUNICIPAL BOND FUND
----------------------------
FIDUCIARY
----------------------------
JANUARY 20,
YEAR 1997
ENDED THROUGH
JUNE 30, JUNE 30,
1998 1997(A)
-------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.06 $ 10.00
-------- --------
Investment Activities:
Net investment income..................................... 0.49 0.23
Net realized and unrealized gains (losses) from
investments............................................ 0.16 0.06
-------- --------
Total from Investment Activities....................... 0.65 0.29
-------- --------
Distributions:
Net investment income..................................... (0.49) (0.23)
Net realized gains........................................ (0.07) --
-------- --------
Total Distributions.................................... (0.56) (0.23)
-------- --------
NET ASSET VALUE, END OF PERIOD.............................. $ 10.15 $ 10.06
======== ========
Total Return................................................ 6.58% 2.90%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $248,590 $255,755
Ratio of expenses to average net assets................... 0.59% 0.59%(c)
Ratio of net investment income to average net assets...... 4.79% 5.09%(c)
Ratio of expenses to average net assets*.................. 0.65% 0.66%(c)
Ratio of net investment income to average net assets*..... 4.73% 5.02%(c)
Portfolio turnover (d).................................... 20.89% 5.66%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
113
370
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ARIZONA MUNICIPAL BOND FUND
-----------------------------
CLASS A
-----------------------------
YEAR JANUARY 20,
ENDED 1997
JUNE THROUGH
30, JUNE 30,
1998 1997(A)
------ ------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.99 $10.00
------ ------
Investment Activities:
Net investment income..................................... 0.46 0.15
Net realized and unrealized gains (losses) from
investments............................................ 0.16 (0.01)
------ ------
Total from Investment Activities....................... 0.62 0.14
------ ------
Distributions:
Net investment income..................................... (0.46) (0.15)
Net realized gains........................................ (0.07) --
------ ------
Total Distributions.................................... (0.53) (0.15)
------ ------
NET ASSET VALUE, END OF PERIOD.............................. $10.08 $ 9.99
====== ======
Total Return (Excludes Sales Charge)........................ 6.30% 1.40%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $1,321 $1,500
Ratio of expenses to average net assets................... 0.84% 0.85%(c)
Ratio of net investment income to average net assets...... 4.53% 4.90%(c)
Ratio of expenses to average net assets*.................. 1.01% 0.96%(c)
Ratio of net investment income to average net assets*..... 4.36% 4.79%(c)
Portfolio turnover (d).................................... 20.89% 5.66%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
114
371
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ARIZONA MUNICIPAL BOND FUND
----------------------------
CLASS B
----------------------------
JANUARY 20,
YEAR 1997
ENDED THROUGH
JUNE 30, JUNE 30,
1998 1997(A)
------ ------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $10.09 $10.00
------ ------
Investment Activities:
Net investment income..................................... 0.13 0.00
Net realized and unrealized gains (losses) from
investments............................................ 0.14 0.09
------ ------
Total from Investment Activities....................... 0.27 0.09
------ ------
Distributions:
Net investment income..................................... (0.13) --
Net realized gains........................................ (0.07) --
------ ------
Total Distributions.................................... (0.20) --
------ ------
NET ASSET VALUE, END OF PERIOD.............................. $10.16 $10.09
====== ======
Total Return (Excludes Sales Charge)........................ 2.67% 0.90%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 290 $ --(c)
Ratio of expenses to average net assets................... 1.50% --(d)
Ratio of net investment income to average net assets...... 3.88% --(d)
Ratio of expenses to average net assets*.................. 1.64% --(d)
Ratio of net investment income to average net assets*..... 3.74% --(d)
Portfolio turnover (e).................................... 20.89% 5.66%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Amount is less than $1,000.
(d) Since net assets are less than $1,000, ratios have not been presented.
(e) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
115
372
- --------------------------------------------------------------------------------
Report of Independent Accountants
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
To the Shareholders and Board of Trustees of
The One Group Family of Mutual Funds:
In our opinion, the accompanying statements of assets and liabilities, including
the portfolios of investments, and related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Intermediate Tax-Free Bond
Fund, the Municipal Income Fund, the Kentucky Municipal Bond Fund, the Ohio
Municipal Bond Fund, the Louisiana Municipal Bond Fund, the West Virginia
Municipal Bond Fund and the Arizona Municipal Bond Fund (seven series of The One
Group Family of Mutual Funds) at June 30, 1998, the results of each of their
operations for the period then ended, the changes in each of their net assets
for the periods presented and the financial highlights for each of the periods
presented (other than those financial highlights that have been audited by other
independent accountants), in conformity with generally accepted accounting
principles. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of The One Group
Family of Mutual Funds' management; our responsibility is to express an opinion
on these financial statements based on our audits. We conducted our audits of
these financial statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at June 30, 1998 by
correspondence with the custodian and brokers, provide a reasonable basis for
the opinion expressed above. The Kentucky Municipal Bond Fund's financial
highlights for the two periods ended January 19, 1995 and January 31, 1994,
respectively, were audited by other independent accountants whose report dated
April 6, 1995 expressed an unqualified opinion on those financial highlights.
PricewaterhouseCoopers LLP
August 18, 1998
116
373
Important Customer Information.
Please Read:
Shares of The One Group:
- - are not deposits or obligations
of, or guaranteed by, BANC One
CORPORATION or its affiliates
- - are not insured or guaranteed by the
FDIC or by any other governmental
agency or government-sponsored
agency of the federal government
or any state
- - are subject to investment risks,
including possible loss of the
principal amount invested.
Banc One Investment Advisors
Corporation, a registered investment
advisor and an indirect subsidiary of
BANC ONE CORPORATION, serves
as an investment advisor to The One
Group, for which it receives advisory
fees. The One Group is distributed by
The One Group Services Company,
3435 Stelzer Road, Columbus,
Ohio 43219, which is not affiliated
with BANC ONE CORPORATION and
is not a bank. Contact us at our web
site address: www.onegroup.com or
e-mail us at onegroup@onegroup.com
For more complete information on
any of The One Group Funds, includ-
ing management fees and expenses,
you may obtain a prospectus from
The One Group Services Company.
Read the prospectus carefully
before investing.
BANC ONE
INVESTMENT
ADVISORS
CORPORATION
[BANC ONE LOGO]
374
Income Funds
Annual Report
For the year ended June 30, 1998
Ultra Short-Term Income Fund
Limited Volatility Bond Fund
Intermediate Bond Fund
Government Bond Fund
Income Bond Fund
Treasury & Agency Fund
THE ONE GROUP
----------------------
FAMILY OF MUTUAL FUNDS
375
IMPORTANT CUSTOMER INFORMATION. INVESTMENT PRODUCTS:
- are not deposits or obligations of, or guaranteed by,
BANC ONE CORPORATION or any of its affiliates, [FDIC LOGO
WITH SLASH
- are not insured by the FDIC, and THOUGH IT]
- are subject to investment risks, including possible
loss of the principal amount invested.
376
- --------------------------------------------------------------------------------
Table of Contents
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
Portfolio Performance Review...................................................2
Schedules of Portfolio Investments............................................14
Statements of Assets and Liabilities..........................................34
Statements of Operations......................................................36
Statements of Changes in Net Assets...........................................38
Statements of Cash Flows......................................................40
Notes to Financial Statements.................................................41
Financial Highlights..........................................................52
Report of Independent Accountants.............................................71
1
377
The One Group Ultra Short-Term Income Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, the One Group Ultra Short-Term Income Fund
Fiduciary share class posted a total return of 6.00%. (For information on other
share classes and performance comparisons to indexes, please see page 3.)
WHAT HAPPENED WITH INTEREST RATES?
Interest rates declined during the year, as expectations of higher inflation and
tighter monetary policy quickly gave way to disinflationary and credit-quality
concerns due to the events in Asia. But, more important for the Fund, the U.S.
yield curve flattened dramatically, causing significant refinancings of
adjustable-rate mortgage (ARM) securities. For example, at the beginning of the
year, the yields on the one-year Treasury bill and the 10-year Treasury note
were 5.65% and 6.49%, respectively. By the end of the year, the yields had
dropped to 5.37% and 5.45%, for a difference of only eight basis points (one
basis point equals 1/100th of a percent.)
With interest rates falling and residential mortgage refinancings hitting
all-time highs during the fiscal year, the Fund's SEC yield declined somewhat.
On June 30, 1998, the Fund's SEC yield for the Fiduciary share class was 5.85%,
compared to 6.08% a year earlier.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
The increase in refinancings has caused a decline in the market value of most
conventional ARMs. Within the ARM sector, certain COFI (Cost of Funds Index)
ARMs were the only securities that outperformed because they exhibited more
stable and predictable prepayment behavior. Asset-backed securities and
commercial mortgages suffered somewhat in the fall of 1997, but they quickly
rebounded and finished the year relatively strong.
As such, our primary efforts during the year were to reduce the Fund's exposure
to conventional one-year ARMs and increase exposure to COFI ARMs, asset-backed
securities, commercial mortgage-backed securities and corporate securities. This
strategy helped us minimize share price volatility and enhance the Fund's yield.
We also chose to maintain the Fund's duration at 0.85 year throughout most of
the year. (Duration is a measure of a fund's price sensitivity to interest rate
changes. A longer duration indicates greater price movement; a shorter duration
indicates less.) While this is within our targeted duration range, the heavy
prepayments experienced in the ARM market caused the Fund to behave as if it had
a shorter duration. As a result, the Fund lost some price appreciation it would
have captured if strong prepayments were not a factor.
WHAT IS YOUR OUTLOOK FOR THE FUND?
The current level of U.S. economic growth probably would have led the Federal
Reserve to raise interest rates. Nevertheless, the developing recessions in Asia
and Eastern Europe have led to significant declines in commodity prices and have
created the potential for disinflation in the United States. Therefore, the U.S.
yield curve is likely to remain flat until Asia shows signs of recovery or the
U.S. economy slows down. But, if the economy slows down and Asia deteriorates,
the yield curve could invert, meaning yields on shorter-term securities would be
greater than yields on longer-term securities.
In this scenario, mortgage-backed and corporate spreads would likely be under
some near-term pressure. In the mortgage market, refinancings could increase
temporarily, and in the corporate market, Asian troubles could cause earnings to
decline. Furthermore, any reduction in U.S. economic growth is likely to
negatively affect corporate earnings and consumer spending. Therefore, we view
any widening of spreads as opportunities.
/s/ Michael J. Sais
Michael J. Sais, CFA
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
2
378
The One Group Ultra Short-Term Income Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/2/93)
Fiduciary 6.00% 5.20% 5.18%
VALUE OF $10,00 INVESTMENT
Lehman
Brothers 1-3
Year
Measurement Period Government Lipper ARM
(Fiscal Year Covered) Index Funds Index Fiduciary
2/93 $10,000 $10,000 $10,000
6/93 10,142 10,134 10,201
6/94 10,297 10,190 10,421
6/95 11,086 10,499 10,957
6/96 11,693 10,961 11,571
6/97 12,462 11,668 12,397
6/98 $13,307 $12,289 $13,141
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (3/10/93)
Class A 5.75% 4.98% 4.97%
Class A* 2.52% 4.34% 4.37%
* Reflects 3.00% Sales Charge.
VALUE OF $10,00 INVESTMENT
Lehman
Brothers 1-3
Year
Measurement Period Government Lipper ARM
(Fiscal Year Covered) Index Funds Index Class A* Class A
3/93 $10,000 $10,000 $ 9,700 $10,000
6/93 10,111 10,109 9,842 10,146
6/94 10,265 10,166 10,033 10,344
6/95 11,052 10,474 10,519 10,845
6/96 11,657 10,935 11,089 11,432
6/97 12,423 11,640 11,866 12,233
6/98 $13,265 $12,259 $12,548 $12,935
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 5.32% 4.66%
Class B** 2.32% 4.66%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,00 INVESTMENT
Lehman
Brothers 1-3
Year
Measurement Period Government Lipper ARM
(Fiscal Year Covered) Index Funds Index Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/94 9,889 9,905 9,991 9,991
6/95 10,648 10,206 10,468 10,468
6/96 11,231 10,654 10,953 10,953
6/97 11,969 11,342 11,634 11,634
6/98 $12,780 $11,945 $12,252 $12,252
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Ultra Short Term Income Fund is measured against the
Lehman Brothers 1 to 3 Year Government Index, an unmanaged index comprised of US
Government and agency securities with maturities of one to three years.
Investors are unable to purchase the index directly, although they can invest in
the underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lipper ARM Funds Index consists of the equally weighted average monthly
return of the largest funds within the universe of all funds in the category.
3
379
The One Group Limited Volatility Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group Limited Volatility Bond Fund
Fiduciary share class posted a total return of 6.59%. (For information on other
share classes and performance comparisons to indexes, please see page 5.)
HOW DID INTEREST RATES INFLUENCE PERFORMANCE?
Interest rates among five-year securities (the area of the yield curve where the
Fund is most heavily invested) declined 0.91 percentage points during the fiscal
year. The Fund's Fiduciary share class 30-day SEC yield also declined, dropping
from 6.18% on June 30, 1997, to 5.75% on June 30, 1998.
Because interest rates declined during the year, prices on most of the Fund's
bonds appreciated and, therefore, added to the Fund's total return. (Bond prices
and interest rates move inversely of each other. When rates fall, bond prices
rise, and vice versa.) The only exceptions were the few Asian bonds in the
Fund's portfolio, which declined in value when the Asian market crisis hit in
1997.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
The Fund's strategy included investing in securities that offered attractive
yields within our maturity and high credit-quality guidelines. As such, we
continued to emphasize government agency mortgage pass-through securities
because they offered yield advantages over other government securities. And, we
focused on 15-year, current coupon issues because they are less likely to be
refinanced even if interest rates fall further. We also invested in asset-backed
securities and high-grade corporate bonds, which provided an excellent
combination of yield, total return and relative safety.
With interest rates declining, we maintained the Fund's duration in a range of
2.3 years to 2.5 years. (Duration is a measure of a fund's price sensitivity to
interest rate changes. A longer duration indicates greater sensitivity; a
shorter duration indicates less.) This, coupled with the Fund's emphasis on
yield, contributed to the Fund's solid return.
DID THE FUND'S OVERALL QUALITY CHANGE DURING THE YEAR?
Because the majority of the Fund's assets always are invested in U.S.
government-related securities (69% of the portfolio at year-end), the Fund's
average quality remains high. On June 30, 1998, 80% of the Fund's securities
were rated AAA (the highest rating), 18% were rated A, and 2% were rated Baa,
giving the Fund an overall quality rating of AA.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We expect positive economic growth to continue, but at a slower pace. This
should help keep inflation low for the near-term, which should perpetuate the
current interest-rate trading range and market status quo. In the corporate
sector, though, a potential negative influence is the steady slowdown in
corporate earnings growth, which could cause corporate yield spreads to widen.
(Corporate spreads refer to the difference in yield between corporate bonds and
comparable-maturity Treasury bonds. When spreads widen, prices on corporate
bonds decline, and vice versa.) We believe a strong offset to this, though, is
the healthy economy, which gives us reason not to abandon the corporate sector.
As a precaution, we will focus on corporate bonds with maturities of five years
or less.
/s/ Roger Craig
Roger Craig
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
4
380
The One Group Limited Volatility Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (9/4/90)
Fiduciary 6.59% 5.41% 7.03%
VALUE OF $10,000 INVESTMENT
Lehman
Brothers 1-3 Lipper Short US
Year Government
Measurement Period Government Bond Funds
(Fiscal Year Covered) Index Index Fiduciary
9/90 $10,000 $10,000 $10,000
6/91 10,768 10,710 10,799
6/92 11,881 11,730 12,068
6/93 12,659 12,515 13,066
6/94 12,852 12,668 13,170
6/95 13,837 13,604 14,218
6/96 14,595 14,309 14,947
6/97 15,554 15,153 15,957
6/98 $16,609 $16,136 $17,008
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 6.32% 5.13% 5.86%
Class A* 3.16% 4.49% 5.35%
* Reflects 3.00% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lehman
Brothers 1-3 Lipper Short US
Year Government
Measurement Period Government Bond Funds
(Fiscal Year Covered) Index Index Class A* Class A
2/92 $10,000 $10,000 $ 9,700 $10,000
6/92 10,284 10,274 10,045 10,356
6/93 10,957 10,962 10,853 11,188
6/94 11,123 11,096 10,906 11,243
6/95 11,976 11,916 11,742 12,105
6/96 12,632 12,534 12,314 12,694
6/97 13,462 13,273 13,110 13,515
6/98 $14,375 $14,134 $13,935 $14,368
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 5.98% 4.75%
Class B** 2.98% 4.75%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lehman
Brothers 1-3 Lipper Short US
Year Government
Measurement Period Government Bond Funds
(Fiscal Year Covered) Index Index Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/94 9,889 9,874 9,819 9,819
6/95 10,648 10,603 10,524 10,524
6/96 11,231 11,153 10,974 10,974
6/97 11,969 11,811 11,604 11,604
6/98 $12,780 $12,578 $12,297 $12,297
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Limited Volatility Bond Fund is measured against the
Lehman Brothers 1 to 3 Year Government Index, an unmanaged index comprised of US
Government and agency securities with maturities of one to three years.
Investors are unable to purchase the index directly, although they can invest in
the underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lipper Short US Government Bond Funds Index consists of the equally weighted
average monthly return of the largest funds within the universe of all funds in
the category.
5
381
The One Group Intermediate Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Intermediate Bond Fund Fiduciary share class offered a total
return of 8.71% for the year ended June 30, 1998. (For information on other
share classes and performance comparisons to indexes, please see page 7.)
HOW DID MARKET DEVELOPMENTS INFLUENCE PERFORMANCE?
Throughout the year, three key trends developed in the bond market:
1. Interest rates, in general, declined, resulting in gains for most bonds and
an overall increase in the Fund's net asset value (NAV).
2. Lower interest rates led to a rise in homeowner refinancing activity, which
caused the performance on many higher-rate mortgage-backed bonds to suffer.
3. Many foreign economies, especially those in Asia, fell into recession, and
prices declined on many Yankee bonds (U.S. dollar-denominated foreign bonds)
associated with these markets.
Overall, the positive influence from the drop in interest rates had a greater
impact on the Fund's performance than the negative influence from holding select
mortgage and Yankee bonds.
While the Fund enjoyed a solid total return and an approximately 2.0% gain in
NAV for the one year period, the declining interest rate environment pushed the
Fund's yield slightly lower-from 6.35% on June 30, 1997, to 5.90% on June 30,
1998.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Once again, duration management remained a key strategy in generating return and
controlling risk. (Duration is a measure of a fund's price sensitivity to
interest rate changes. A longer duration indicates greater sensitivity; a
shorter duration indicates less.) We managed the Fund's duration within a tight,
shorter-than-market-average range during the year, which limited some of the
price gains that occurred mid-year when interest rates fell. While we do manage
the Fund's exposure to changes in interest rates, we also purposely limit the
degree to which we alter duration. We believe these risk-control guidelines
protect us from making ill-timed "bets" on the magnitude and direction of
possible interest rate movements.
Nevertheless, the Fund's strong yield helped make up for the effects of our
shorter duration. Furthermore, the Fund's holdings in long-duration U.S.
Treasury and corporate bonds and select commercial mortgage-backed securities
helped overall performance during the year.
Another key move during the Fund's fiscal year occurred in early 1998, when we
reduced the Fund's small exposure to Asian Yankee bonds, which deteriorated
along with many Asian economies. By fiscal year-end, the Fund held about 1.5% of
its assets in Asian-based Yankee bonds, all of which maintained investment-grade
quality ratings (rated BBB or better).
WHAT IS YOUR OUTLOOK FOR THE FUND?
Our forecast calls for the U.S. economy to maintain its steady, albeit slower,
growth pattern over the next year. As a result, inflation should remain tame and
interest rates stable to lower.
At the same time, the prospect for unfavorable developments has risen. For
example, the economy is operating at employment levels that typically lead to
increasing rates of inflation. This, however, is being offset by economic
recession in many Asian countries. While we remain optimistic, unexpected
changes in these or other important economic dynamics could lead to
greater-than-expected volatility in the U.S. financial markets.
/s/ James A. Sexton
James A. Sexton, CFA
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
6
382
The One Group Intermediate Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/29/92)
Fiduciary 8.71% 6.08% 6.96%
VALUE OF $10,000 INVESTMENT
Lehman Lipper
Brothers Inertmediate US
Intermediate Government
Measurement Period Government/Corporate Bond Funds
(Fiscal Year Covered) Bond Index Index Fiduciary
2/92 $10,000 $10,000 $10,000
6/92 10,355 10,307 10,300
6/93 11,442 11,357 11,400
6/94 11,413 11,162 11,315
6/95 12,597 12,260 12,463
6/96 13,228 12,786 13,080
6/97 14,182 13,670 14,084
6/98 $15,394 $14,959 $15,310
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (11/30/94)
Class A 8.47% 8.66%
Class A* 3.58% 7.26%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lehman Lipper
Brothers Intermediate US
Intermediate Government
Measurement Period Government/Corporate Bond Funds
(Fiscal Year Covered) Bond Index Index Class A* Class A
11/94 $10,000 $10,000 $ 9,550 $10,000
6/95 10,999 10,984 10,533 11,029
6/96 11,550 11,480 11,036 11,556
6/97 12,383 12,274 11,853 12,411
6/98 $13,441 $13,431 $12,850 $13,462
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (11/30/94)
Class B 7.78% 7.59%
Class B** 3.78% 6.90%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lehman Lipper
Brothers Intermediate US
Intermediate Government
Measurement Period Government/Corporate Bond Funds
(Fiscal Year Covered) Bond Index Class B** Class B
11/94 $10,000 $10,000 $10,000 $10,000
6/95 10,999 10,984 10,845 10,845
6/96 11,550 11,480 11,290 11,290
6/97 12,383 12,274 12,061 12,061
6/98 $13,441 $13,431 $12,699 $12,999
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
(11/4/97)
Class C 8.20%
Class C** 7.20%
** Reflects Applicable Contingent Deferred Sales Charge.
Lehman Lipper
Brothers Intermediate US
Intermediate Government
Measurement Period Government/Corporate Bond Funds
(Fiscal Year Covered) Bond Index Class C** Class C
11/97 $10,000 $10,000 $10,000 $10,000
6/98 $10,430 $10,455 $10,719 $10,819
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Intermediate Bond Fund is measured against the Lehman
Brothers Intermediate Government/Corporate Bond Index, an unmanaged index
comprised of US Government agency and Treasury securities and investment grade
corporate bonds. Investors are unable to purchase the index directly, although
they can invest in the underlying securities. The performance of the index does
not reflect the deduction of expenses associated with a mutual fund, such as
investment management. By contrast, the performance of the fund reflects the
deduction of these value-added services as well as the deduction of sales
charges on Class A Shares and applicable contingent deferred sales charges on
Class B and Class C Shares.
The Lipper Intermediate US Government Bond Funds Index consists of the equally
weighted average monthly return of the largest funds within the universe of all
funds in the category.
7
383
The One Group Government Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
The One Group Government Bond Fund Fiduciary share class posted a total return
of 10.81% for the year ended June 30, 1998. (For information on other share
classes and performance comparisons to indexes, please see page 9.)
WHAT HAPPENED TO INTEREST RATES?
Interest rates declined significantly during the year, as demonstrated by the
yield on 10-year Treasury notes, which dropped from 6.49% to 5.45%, and
five-year Treasury notes, which fell from 6.37% to 5.47%. The Fund's Fiduciary
share class 30-day SEC yield also declined, from 6.24% on June 30, 1997, to
5.88% on June 30, 1998.
In addition, the yield curve flattened during the year, as the difference in
yield between one- and 10-year Treasuries went from 85 basis points at the
beginning of the year to only eight basis points at the end of the year. (One
basis point equals 1/100th of a percent.)
WHAT AFFECT DID THE RATE DECLINE HAVE ON THE FUND'S INVESTMENTS?
The decline in interest rates put pressure on mortgage spreads, as fear of
increasing supply due to refinancings and record interest rate volatility
permeated the market. (The trading of fixed-rate mortgages is based on spreads,
or the difference in yield between mortgage-backed securities and Treasury
securities with the same average life.) The mortgage prepayment surge had the
effect of rapidly shortening duration on the Fund's mortgage-backed securities,
which forced us to frequently readjust the Fund's mortgage holdings. (Duration
is a measure of price sensitivity to interest rate changes. A shorter duration
indicates less sensitivity; a longer duration indicates greater sensitivity.)
Despite the level of prepayments, mortgage-backed securities returned 8.93% for
the year. The Fund's return surpassed this, without making an extraordinary
duration or asset-mix commitment.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
Throughout the year we maintained investments in U.S. Treasuries, agency
securities and agency-issued mortgage-backed securities. Thus, the impact of the
Asian crisis on the Fund was realized in the strong performance of Treasury
securities, which benefited from the flight-to-quality environment.
We maintained the Fund's duration in a tight band around our five-year target,
which limited price movements caused by interest-rate volatility. This strategy
is a reflection of the Fund's greater emphasis on yield than price appreciation.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We expect the economy to moderate eventually and yields to decline further.
Nevertheless, we don't foresee this having a significant effect on the Fund's
overall strategy. We may focus on different types of mortgage-backed securities
in response to economic and market conditions, but we plan to largely maintain
the Fund's current sector allocations. Any changes should be tactical in nature,
rather than strategic or stylistic. We believe that the Fund's emphasis on yield
and tight duration should continue to serve investors well.
/s/ Michael J. Sais
Michael J. Sais, CFA
Fund Manager
/s/ Thomas E. Donne
Thomas E. Donne, CFA
Fund Co-Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
8
384
The One Group Government Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/8/93)
Fiduciary 10.81% 6.27% 6.48%
VALUE OF $10,000 INVESTMENT
Salomon Lipper US
Brothers 3-7 Government
Measurement Period Year Bond Funds
(Fiscal Year Covered) Treasury Index Index Fiduciary
3/93 $10,000 $10,000 $10,000
6/93 10,275 10,289 10,351
6/94 10,174 9,973 10,068
6/95 11,275 11,028 11,281
6/96 11,790 11,440 11,710
6/97 12,623 12,256 12,659
6/98 $13,701 $13,477 $14,027
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (3/5/93)
Class A 10.54% 5.98% 5.95%
Class A* 5.53% 5.01% 5.03%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Salomon Lipper US
Brothers 3-7 Government
Measurement Period Year Treasury Bond Funds
(Fiscal Year Covered) Index Index Class A* Class A
3/93 $10,000 $10,000 $ 9,550 $10,000
6/93 10,237 10,252 9,713 10,171
6/94 10,136 9,937 9,406 9,849
6/95 11,233 10,989 10,519 11,015
6/96 11,746 11,399 10,896 11,410
6/97 12,576 12,212 11,749 12,303
6/98 $13,650 $13,428 $12,986 $13,598
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 9.86% 5.70%
Class B** 5.86% 5.33%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Salomon Lipper US
Brothers 3-7 Government
Measurement Period Year Treasury Bond Funds
(Fiscal Year Covered) Index Index Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/94 9,560 9,377 9,501 9,501
6/95 10,595 10,369 10,566 10,566
6/96 11,079 10,757 10,877 10,877
6/97 11,862 11,524 11,654 11,654
6/98 $12,875 $12,672 $12,602 $12,802
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Government Bond Fund is measured against the Salomon
Brothers 3 to 7 Year Treasury Index, an unmanaged index comprised of US
Government agency and Treasury securities and agency mortgaged-backed
securities. Investors are unable to purchase the index directly, although they
can invest in the underlying securities. The performance of the index does not
reflect the deduction of expenses associated with a mutual fund, such as
investment management. By contrast, the performance of the fund reflects the
deduction of these value-added services as well as the deduction of sales
charges on Class A Shares and applicable contingent deferred sales charges on
Class B Shares.
The Lipper US Government Bond Funds Index consists of the equally weighted
average monthly return of the largest funds within the universe of all funds in
the category.
9
385
The One Group Income Bond Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group Income Bond Fund Fiduciary share
class posted a total return of 7.97%. (For information on other share classes
and performance comparisons to indexes, please see page 11.)
In general, interest rates declined by approximately one percentage point during
the fiscal year. The Fund's Fiduciary share class 30-day SEC yield also
declined, dropping from 6.70% on June 30, 1997, to 6.13% on June 30, 1998.
WAS THERE A PARTICULAR TYPE OF SECURITY THAT AFFECTED PERFORMANCE?
Even though the Fund's yield fell, it remained attractive due to the Fund's
emphasis on higher-yielding investment-grade securities. Included among those
securities are Yankee bonds (U.S. dollar-denominated foreign bonds), which
performed well and contributed greatly to the Fund's total return until the
fourth quarter of 1997. As the financial crisis overtook Asia, the value of the
Fund's Asian Yankee bonds declined rapidly and, at 10% of Fund assets, caused
significant underperformance. Once prices stabilized and began to improve, we
implemented a control strategy for these bonds, reducing them to only 1.5% of
Fund assets. This measured reduction caused the Fund's performance to return to
above-average.
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
The Fund's strategy is to try to maintain a relatively stable duration of
approximately 4.6 years and to enhance yield through a widely diversified
portfolio of corporate bonds and mortgage securities. (Duration is a measure of
a fund's price sensitivity to interest rate changes. A longer duration indicates
greater sensitivity; a shorter duration indicates less.) We purposely avoid
making significant changes to the Fund's duration, because we manage the Fund
primarily to maximize income, rather than to seek capital gains by making "bets"
on interest rate movements. We try to maintain a neutral duration and position
the Fund to earn a relatively good rate of interest income.
This strategy has worked well, as the Fund has been able to generate incremental
returns without incurring additional interest rate risk. At the same time, the
strategy involves some exposure to credit risk, which, for short periods of
time, may adversely affect returns, as witnessed in late-1997. But, over full
interest rate and credit cycles, the strategy has proven successful to date.
DID THE FUND'S OVERALL QUALITY CHANGE DURING THE YEAR?
In April 1997, shareholders approved a measure that allows the Fund to invest up
to 30% of its assets in high-yield securities, or those rated BB or B. As
outlined at that time, the Fund's entry into this sector will be slow and
measured. Since then, we have added a 4% exposure to BB-rated bonds.
The Fund maintained a good quality profile during the fiscal year, with 52% of
its assets invested in securities rated AAA; 5% in those rated AA; 16% in
A-rated; 23% in BBB-rated; and 4% in BB-rated. The Fund's overall quality rating
was A+ at the end of the year.
WHAT IS YOUR OUTLOOK FOR THE FUND?
Moving forward, we expect economic growth to continue, but at a slower pace. We
also expect inflation to remain low for the near term. The bond market
environment is likely to be characterized as a "trading range," which is a
market that doesn't change much. In such a climate, higher-yielding securities
typically produce better results.
In the corporate sector, a potential negative influence is the steady decline in
corporate earnings growth, which could cause corporate yield spreads to widen.
(Corporate spreads refer to the difference in yield between corporate bonds and
comparable-maturity Treasury bonds. When spreads widen, prices on corporate
bonds decline, and vice versa.) A strong offset to this, though, is the healthy
economy, which gives us reason not to abandon this sector. As a precaution, we
will focus on corporate bonds with maturities of five years or less. In the
mortgage market, most of the Fund's recent purchases have been 15-year, current
coupon issues, which we believe are less likely to be refinanced even if
interest rates fall further.
/s/ Roger Craig
Roger Craig
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
10
386
The One Group Income Bond Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (7/2/87)
Fiduciary 7.97% 5.85% 7.63% 7.30%
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Inertmediate
Brothers Investment
Measurement Period Aggregate Bond Grade Bond
(Fiscal Year Covered) Index Funds Index Fiduciary
6/88 $10,000 $10,000 $10,000
6/89 11,222 11,005 10,732
6/90 12,103 11,632 11,417
6/91 13,397 12,632 12,467
6/92 15,278 14,394 14,193
6/93 17,079 16,087 15,701
6/94 16,857 15,872 15,352
6/95 18,972 17,634 17,086
6/96 19,923 18,492 17,876
6/97 21,547 19,901 19,324
6/98 $23,818 $21,817 $20,864
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year (2/18/92)
Class A 7.82% 5.60% 6.64%
Class A* 3.00% 4.63% 5.87%
* Reflects 4.50% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Brothers Investment
Measurement Period Aggregate Bond Grade Bond
(Fiscal Year Covered) Index Funds Index Class A* Class A
2/92 $10,000 $10,000 $ 9,550 $10,000
6/92 10,345 10,356 9,901 10,368
6/93 11,564 11,574 10,948 11,464
6/94 11,413 11,420 10,693 11,197
6/95 12,845 12,688 11,859 12,418
6/96 13,490 13,305 12,365 12,947
6/97 14,589 14,319 13,335 13,964
6/98 $16,127 $15,702 $14,381 $15,052
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year (1/14/94)
Class B 7.13% 5.07%
Class B** 3.13% 4.70%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lipper
Lehman Intermediate
Brothers Investment
Measurement Period Aggregate Bond Grade Bond
(Fiscal Year Covered) Index Funds Index Class B** Class B
1/94 $10,000 $10,000 $10,000 $10,000
6/94 9,485 9,488 9,471 9,471
6/95 10,675 10,542 10,478 10,478
6/96 11,211 11,055 10,860 10,860
6/97 12,124 11,897 11,637 11,637
6/98 $13,402 $13,046 $12,274 $12,466
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The performance of the Income Bond Fund is measured against the Lehman Brothers
Aggregate Bond Index, an unmanaged index comprised of US Government, mortgage,
corporate and asset-backed securities. Investors are unable to purchase the
index directly, although they can invest in the underlying securities. The
performance of the index does not reflect the deduction of expenses associated
with a mutual fund, such as investment management. By contrast, the performance
of the fund reflects the deduction of these value-added services as well as the
deduction of sales charges on Class A Shares and applicable contingent deferred
sales charges on Class B Shares.
The Lipper Intermediate Investment Grade Bond Funds Index consists of the
equally weighted average monthly return of the largest funds within the universe
of all funds in the category.
11
387
The One Group Treasury & Agency Fund
Portfolio Performance Review
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
HOW DID THE FUND PERFORM?
For the year ended June 30, 1998, The One Group Treasury & Agency Fund Fiduciary
share class returned 7.91%. (For information on other share classes and
performance comparisons to indexes, please see page 13.)
In response to the weakening global economy led by the turmoil in Asia, market
yields generally declined during the year and bond prices increased. Following
suit, the Fund's share price increased by approximately 1%, and the Fund's
30-day SEC yield declined from 6.04% on June 30, 1997, to 5.37% on June 30, 1998
(Fiduciary share class).
WHAT WERE YOUR PRIMARY STRATEGIES AND TACTICS?
With a focus on Treasuries, our primary strategy during the year was to select
those Treasury securities that offered the highest potential return. To do this,
we analyzed the yield differentials and possible future dynamics for Treasury
securities of different maturities. Our research indicated that Treasuries in
the one- to two-year, four-year and seven- to eight-year maturity ranges were
the most attractive, and we subsequently purchased those securities.
We also invested in select federal agency securities, which provided some yield
advantage over Treasuries. In addition, we invested in certain callable
securities when our analysis indicated that the return potential more than
compensated for any chance that the security may be "called" prior to maturity.
(The call feature refers to the bond issuer's right to repay, or "call," the
bond before the scheduled maturity date. Securities that have this feature
typically offer higher yields in return for the call risk.) In fact, the best
relative performance came from callable federal agency bonds. The Fund benefited
from the relatively higher yields on these securities, and, because interest
rates only moved down modestly, the securities were not called.
We maintained the Fund's duration close to its target of 2.9 years, except
during the fourth quarter of 1997, when concerns about events in Asia caused us
to lower duration to 2.6 years. (Duration is a measure of a fund's sensitivity
to interest rate changes. A longer duration indicates greater sensitivity; a
shorter duration indicates less.) As it turned out, Asia had a greater impact on
slowing the U.S. economy than we originally expected, so we brought the Fund's
duration back to 2.9 years. This enabled the Fund to experience greater benefits
from the declining rate environment.
WHAT IS YOUR OUTLOOK FOR THE FUND?
We expect market yields and bond prices to fluctuate, but not to change
significantly from today's levels. As such, we plan to maintain the Fund's
duration of 2.9 years into fiscal year 1999. It's likely that we will increase
the Fund's agency holdings to capture yield advantages over Treasuries. In
addition, we will continue to invest in callable securities, as we do not expect
dramatic fluctuations in the bond market.
/s/ Scott E. Grimshaw
Scott E. Grimshaw
Fund Manager
/s/ Gary J. Madich
Gary J. Madich, CFA
Senior Managing Director of Fixed-Income Securities
Please refer to the prospectus and the accompanying financial statements for
further information about your Fund.
12
388
The One Group Treasury & Agency Fund
Portfolio Performance Review, continued
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (4/30/88)
Fiduciary 7.91% 6.30% 7.42% 7.39%
VALUE OF $10,000 INVESTMENT
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Treasury Index Lipper Mix Fiduciary
6/88 $10,000 $10,000 $10,000
6/89 11,005 11,005 10,904
6/90 11,844 11,834 11,715
6/91 13,082 12,876 12,804
6/92 14,767 14,104 14,132
6/93 16,263 15,048 15,073
6/94 16,232 15,232 15,313
6/95 17,809 16,356 17,047
6/96 18,679 17,205 17,730
6/97 19,961 18,219 18,962
6/98 $21,642 $19,402 $20,462
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (4/30/88)
Class A 8.10% 6.16% 7.21% 7.18%
Class A* 4.85% 5.53% 6.88% 6.86%
* Reflects 3.00% Sales Charge.
VALUE OF $10,000 INVESTMENT
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Treasury Index Lipper Mix Class A* Class A
6/88 $10,000 $10,000 $ 9,700 $10,000
6/89 11,005 11,005 10,540 10,866
6/90 11,844 11,834 11,310 11,660
6/91 13,082 12,876 12,326 12,707
6/92 14,767 14,104 13,569 13,989
6/93 16,263 15,048 14,427 14,873
6/94 16,232 15,232 14,637 15,090
6/95 17,809 16,356 16,230 16,732
6/96 18,679 17,205 16,843 17,364
6/97 19,961 18,219 17,994 18,551
6/98 $21,642 $19,402 $19,452 $20,054
AVERAGE ANNUAL
TOTAL RETURN AS OF JUNE 30, 1998
Since
Inception
1 Year 5 Year 10 Year (4/30/88)
Class B 7.33% 5.59% 6.66% 6.63%
Class B** 4.33% 5.59% 6.66% 6.63%
** Reflects Applicable Contingent Deferred Sales Charge.
VALUE OF $10,000 INVESTMENT
Lehman
Brothers
Measurement Period Intermediate
(Fiscal Year Covered) Treasury Index Lipper Mix Class B** Class B
6/88 $10,000 $10,000 $10,000 $10,000
6/89 11,005 11,005 10,813 10,813
6/90 11,844 11,834 11,539 11,539
6/91 13,082 12,876 12,525 12,525
6/92 14,767 14,104 13,719 13,719
6/93 16,263 15,048 14,515 14,515
6/94 16,232 15,232 14,636 14,636
6/95 17,809 16,356 16,176 16,176
6/96 18,679 17,205 16,695 16,695
6/97 19,961 18,219 17,747 17,747
6/98 $21,642 $19,402 $19,048 $19,048
The performance data quoted represents past performance and is not an indication
of future results. Investment return and NAV will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost. The total return set forth may reflect the waiver of a portion of the
fund's fees for certain periods since the inception date, without the waiver,
total return would have been lower.
The above-quoted performance data includes the performance of the Treasury &
Agency Collective Trust Fund for the period prior to the commencement of
operations of the Treasury & Agency Fund on January 20, 1997, adjusted to
reflect the deduction of fees and expenses (absent any waivers) applicable to
the Fiduciary, Class A and Class B shares of the Treasury & Agency Fund. The
Treasury & Agency Collective Trust Fund was not registered under the Investment
Company Act of 1940 ("1940 Act") and, therefore, was not subject to certain
investment restrictions, limitations and diversification requirements imposed by
the 1940 Act and the Internal Revenue Code. If the Treasury & Agency Collective
Trust Fund had been registered under the 1940 Act, its performance may have been
adversely affected.
The performance of the Treasury & Agency Fund is measured against the Lehman
Brothers Intermediate Treasury Index, an unmanaged index comprised of US
Treasury-issued securities with maturities of one to ten years. Investors are
unable to purchase the index directly, although they can invest in the
underlying securities. The performance of the index does not reflect the
deduction of expenses associated with a mutual fund, such as investment
management. By contrast, the performance of the fund reflects the deduction of
these value-added services as well as the deduction of sales charges on Class A
Shares and applicable contingent deferred sales charges on Class B Shares.
The Lipper Mix for all the classes consists of the average monthly returns of
the Lipper Intermediate Treasury Bond Funds Index from April 1988 through
December 1989. Thereafter, the data is from the Lipper Short US Government Bond
Funds Index which corresponds with the initiation of the Index on January 1,
1989. The Lipper Indices consist of the equally weighted average monthly return
of the largest funds within the universe of all funds in the category.
13
389
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ultra Short-Term Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- --------
ASSET BACKED SECURITIES (20.1%):
$ 718 Auto Finance Group, Inc., Series
1997-B, Class B, 6.40%,
2/15/03........................ $ 719
1,437 Auto Finance Group, Inc., Series
1997-B, Class C, 7.00%,
2/15/03........................ 1,418
1,897 Countrywide Home Equity, Series
1997-D, Class A, 5.86%,
12/15/23*...................... 1,897
4,157 Greentree Financial Home Equity
Loan, Series 1997-D, 5.88%,
9/15/28*....................... 4,157
4,776 Greentree Financial Home Equity
Loan, Series 1998-B, Class A1B,
ARM, 5.88%, 11/15/29*.......... 4,774
2,732 Hyundai Auto Receivables Trust,
Series 1998-A, Class A1, 5.90%,
4/15/01........................ 2,730
2,000 Loop Funding Master Trust I,
Series 1997-A144, Class C1,
6.44%, 12/26/07*............... 2,000
5,000 MBNA Master Credit Card Trust,
Series 1997-E, Class B, 5.94%,
9/15/04*....................... 5,000
2,242 Merrill Lynch Home Equity Loan,
Series 1997-1, Class A, 5.83%,
9/25/27*....................... 2,242
747 Morgan Stanley Capital Issue,
Series 1997-C1, Class A2,
6.05%, 2/15/20*................ 745
3,000 People's Bank Credit Card Master
Trust, Series 1997-2, Class B,
5.98%, 4/15/05*................ 2,999
1,283 Structured Asset Securities
Corp., Series 1997-1, Class B2,
6.52%, 11/15/26*............... 1,291
886 Structured Asset Securities
Corp., Series 1997-C1, Class D,
6.26%, 8/25/00*................ 886
1,942 Structured Asset Securities
Corp., Series 1998-C2A, Class
C, 6.09%, 1/25/01*............. 1,941
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- --------
ASSET BACKED SECURITIES, CONTINUED:
$ 1,969 Structured Asset Securities
Corp., Series 1998-C2A, Class
D, 6.26%, 1/25/01*............. $ 1,968
5,000 Student Loan Marketing Assoc.,
Series 1997-3, 6.02%,
10/25/12*...................... 5,007
3,697 The Money Store Home Equity
Trust, Series 1993-D, Series
A2, 5.08%, 2/15/18............. 3,655
286 UCFC Home Equity Loan, Series
1993-B2, Class A2, 6.20%,
7/25/14........................ 285
--------
Total Asset Backed Securities 43,714
--------
COLLATERALIZED MORTGAGE OBLIGATIONS (14.8%):
3,543 AMAC, Series 1998-1, Class A5,
6.50%, 4/25/28................. 3,560
2,058 American Housing Trust, Series
VII, Class D, 9.25%,
11/25/20....................... 2,357
1,103 Chemical Mortgage Acceptance
Corp., Series 1988-2, Class A,
7.46%, 5/25/18*................ 1,131
3,276 Citicorp Mortgage Securities,
Series 1988-17, Class A1,
7.29%, 11/25/18*............... 3,328
2,007 First Boston Mortgage Securities,
Series 1992-5, Class 2A, 7.67%,
1/25/23*....................... 2,056
5,000 GE Capital Mortgage Services,
Inc., Series 1998-10, Class
1A2, 6.50%, 5/25/28............ 5,021
2,679 Glendale Federal Bank, Series
1990-1, Class A, 7.11%,
10/25/29*...................... 2,727
2,000 Nomura Depositor Trust, Series
1998-ST1, Class A2, 6.08%,
1/15/03*....................... 2,002
1,595 Nomura Mortgage Capital Corp.,
Series 1990-1, Class H, 7.00%,
6/17/20........................ 1,621
510 Prudential Home Mortgage
Securities, Series 1992-45,
Class A4, 6.50%, 1/25/00....... 512
Continued
14
390
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ultra Short-Term Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- --------
COLLATERALIZED MORTGAGE OBLIGATIONS, CONTINUED:
$ 2,882 Salomon Brothers Mortgage
Securities, Series 1987-2,
Class A, 7.09%, 12/25/17*...... $ 2,932
3,926 Salomon Brothers Mortgage
Securities, Series 1988-2,
Class A, 6.70%, 6/25/18*....... 3,907
1,105 Sears Mortgage Securities Corp.
Services, Series 1992-18A,
Class A3, 7.78%, 9/25/22*...... 1,125
--------
Total Collateralized Mortgage Obligations 32,279
--------
CORPORATE BONDS (3.2%):
Financial Services (3.2%):
2,000 Lehman Brothers Holdings, 6.21%,
6/3/02*........................ 1,987
5,000 MBNA Corp., 6.29%, 5/23/03*...... 5,015
--------
Total Corporate Bonds 7,002
--------
U.S. GOVERNMENT AGENCY MORTGAGES (61.2%):
Federal Home Loan Mortgage Corp. (16.6%):
1,934 6.00%, 10/1/00, Gold Pool
#G50424........................ 1,950
971 7.50%, 7/15/06, Series 1106,
Class E........................ 995
2,000 6.50%, 5/15/09, Series 1628 LC... 2,072
3,393 8.00%, 12/1/09, Pool #G10314..... 3,509
95 8.00%, 1/1/10, Pool #E00355...... 98
2,671 8.00%, 1/1/10, Pool #G10307...... 2,762
358 8.00%, 4/1/10, Pool #E00371...... 370
2,229 7.86%, 5/1/18, Pool #840160, 1
Year CMT ARM*.................. 2,305
7,380 3.50%, 11/15/21, Series 1584
HA............................. 6,481
413 6.91%, 12/1/21, Pool #645083, 1
Year CMT ARM*.................. 415
3,943 7.79%, 2/1/23, Pool #845297...... 4,089
4,894 6.14%, 12/15/23, Series 1637 LG,
CMO*........................... 4,839
2,110 9.00%, 2/1/25, Pool #C00387...... 2,248
4,014 6.44%, 6/1/26, Pool #785586, 1
Year CMT ARM*.................. 4,051
--------
36,184
--------
Federal National Mortgage Assoc. (32.6%):
295 6.50%, 11/1/03, Pool #44174...... 302
1,281 5.75%, 9/1/06, Pool #411526...... 1,271
1,804 6.50%, 4/1/16, Pool #344051...... 1,814
908 6.75%, 3/1/17, Pool #47109, 1
Year CMT ARM*.................. 921
1,501 7.01%, 5/1/18, Pool #75505, 6
Month T-Bill ARM*.............. 1,548
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Federal National Mortgage Assoc., continued:
$ 421 6.82%, 6/1/18, Pool #70793, 6
Month T-Bill ARM*.............. $ 436
2,542 7.12%, 1/1/20, Pool #90031, 1
Year CMT ARM*.................. 2,600
1,828 6.25%, 1/25/20, Series 1993-102
G.............................. 1,840
1,676 7.70%, 5/1/20, Pool #96195*...... 1,725
5,346 7.18%, 7/1/20, Pool #133558, 1
Year CMT ARM* (b).............. 5,466
2,428 7.35%, 12/1/20, Pool #116590, 1
Year CMT ARM*.................. 2,501
2,689 6.60%, 12/25/20, Series 1990-145,
Class A, CMO*.................. 2,705
1,519 7.30%, 4/1/21, Pool #70983, 1
Year CMT ARM*.................. 1,554
957 9.00%, 8/1/21, Pool #348983...... 1,001
878 7.81%, 11/1/21, Pool #124510, 1
Year CMT ARM*.................. 919
421 7.75%, 11/1/22, Pool #193013, 1
Year CMT ARM*.................. 434
2,309 7.31%, 3/1/23, Pool #202670,
6 Month CD ARM*................ 2,397
1,352 7.54%, 11/1/23, Pool #241828,
6 Month CD ARM*................ 1,396
578 8.50%, 7/1/24, Pool #342036...... 606
1,056 8.50%, 10/1/24, Pool #345876..... 1,105
1,265 9.00%, 4/1/25, Pool #370122...... 1,323
778 7.63%, 7/1/25, Pool #326092, 1
Year CMT ARM*.................. 806
1,190 9.00%, 8/1/25, Pool #361354...... 1,245
4,784 7.63%, 6/1/26, Pool #313555*..... 4,897
1,315 7.48%, 11/1/26, Pool #363030, 1
Year CMT ARM*.................. 1,346
3,081 6.29%, 3/18/27, Series 1997-7 FB,
CMO*........................... 3,084
3,725 7.27%, 7/1/27, Pool #70179, 1
Year CMT ARM*.................. 3,841
4,600 7.00%, 12/1/25, Pool #315687,
COFI ARM TBA................... 4,629
4,101 6.22%, 10/1/28, Pool #67694, COFI
ARM*........................... 4,130
4,567 6.20%, 8/1/29, Pool #303742*..... 4,598
3,981 7.66%, 1/1/31, Pool #124945, 1
Year CMT ARM*.................. 4,155
4,146 6.22%, 5/1/36, Pool #313600*..... 4,175
--------
70,770
--------
Government National Mortgage Assoc. (12.0%):
1,830 9.00%, 11/15/24, Pool #780029.... 1,988
45 6.88%, 2/20/27, Pool #80045...... 46
Continued
15
391
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Ultra Short-Term Income Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Government National Mortgage Assoc., continued:
$13,883 6.00%, 7/20/27, Pool #80094, 1
Year CMT ARM................... $ 14,143
4,864 8.00%, 10/15/27, Pool #412336.... 5,043
4,754 6.00%, 11/20/27, Pool #80136*.... 4,831
--------
26,051
--------
Total U.S. Government Agency Mortgages 133,005
--------
YANKEE & EURODOLLAR (1.0%):
1,275 BHN, Series 1997-1, Class A1,
7.10%, 3/25/11*................ 1,264
1,000 Poland (Discount Brady), 6.69%,
10/27/24*...................... 980
--------
Total Yankee & Eurodollar 2,244
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- --------------------------------- --------
REPURCHASE AGREEMENTS (1.7%):
$ 3,724 Prudential Securities, 6.10%,
7/1/98 (Collateralized by
$3,833 U.S. Treasury Bills,
9/3/98, market value $3,799)... $ 3,724
--------
Total Repurchase Agreements 3,724
--------
Total (Cost $221,196) (a) $221,968
========
- ------------
Percentages indicated are based on net assets of $217,411.
(a) Represents cost for financial reporting and federal income tax purposes and
differs from value by net unrealized appreciation of securities as follows
(amounts in thousands):
Unrealized appreciation..................................... $1,206
Unrealized depreciation..................................... (434)
------
Net unrealized appreciation................................. $ 772
======
(b) Serves as collateral for futures contracts.
At June 30, 1998, the Portfolio's open futures contracts were as follows:
CURRENT
NUMBER OPENING MARKET
OF POSITIONS VALUE
CONTRACTS CONTRACT TYPE (000) (000)
--------- ------------- ----- -----
50 Short U.S. 5 Year Note March, 1998 Futures $ (5,463) $ (5,484)
75 Short U.S. 2 Year Note March, 1998 Futures (15,605) (15,628)
-------- --------
$(21,068) $(21,112)
======== ========
* The interest rate, for this variable rate note, which will change
periodically, is based upon prime rates or an index of market rates. The rate
reflected on the Schedule of Portfolio Investments is the rate in effect at
June 30, 1998.
ARM Adjustable Rate Mortgage
CD Certificate of Deposit
CMO Collateralized Mortgage Obligation
CMT Collateralized Mortgage Trust
COFI Cost of Funds Index
TBA To be announced
See notes to financial statements.
16
392
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Limited Volatility Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
ASSET BACKED SECURITIES (13.1%):
$ 1,488 Bay View Auto Trust, Series 97-RA1,
Class A1, 6.29%, 12/15/01........ $ 1,488
2,985 Case Equipment Loan Trust, Series
96-A, Class A2, 5.50%, 2/15/03... 2,981
5,000 CIT RV Trust, Series 1998-A, Class
B, 6.29%, 1/15/17................ 5,003
5,000 Citibank Credit Card Master Trust,
Series 1998-1, Class B, 5.88%,
1/15/03.......................... 4,987
7,750 Citibank, Master Trust, Series
97-9, Class A, 0.00%, 8/15/06.... 5,370
3,700 Consumer Portfolio Services, Series
1997-2 A, 6.65%, 10/15/02........ 3,730
2,073 Countrywide Asset-Backed
Certificate, 6.53%, 2/25/14...... 2,077
5,045 DVI Equipment Receivables Trust,
Series 1997-A, Class A, 6.45%,
1/15/04.......................... 5,069
3,909 Fifth Third Auto Grantor Trust,
1996-A, Class A, 6.20%,
9/15/01.......................... 3,923
3,320 Fifth Third Auto Grantor Trust,
1996-B, Class A, 6.45%,
3/15/02.......................... 3,338
5,000 Ford Motor Credit Auto Loan Master,
Series 1995-1, Class A, 6.50%,
8/15/02.......................... 5,061
5,000 Ford Motor Credit Auto Owner Trust,
Series 1998-B, Class B, 6.15%,
9/15/02.......................... 5,024
6,500 Metris Mastertrust, 7.11%,
10/1/05.......................... 6,764
7,569 Newcourt Receivables Trust, Series
1996-3, Class A, 6.24%,
12/20/04......................... 7,572
1,067 Olympic Automobile Receivables
Trust, Series 1996-D, Class A2,
5.75%, 4/15/00................... 1,066
4,425 Olympic Automobile Receivables
Trust, Series 1996-D, Class A3,
5.95%, 6/15/01................... 4,428
7,000 Proffitt's Credit Card Master
Trust, Series 1997-2, Class B,
6.69%, 12/15/05.................. 7,172
5,000 Ryder Vehicle Lease, Series 1998-A,
Class A, 6.10%, 9/15/08.......... 5,009
--------
Total Asset Backed Securities 80,062
--------
COMMERCIAL MORTGAGE BACKED SECURITIES (0.9%):
5,281 CMC Securities Corp. III, Series
1994-D, Class M, 6.00%,
3/25/24.......................... 5,217
--------
Total Commercial Mortgage Backed Securities 5,217
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
CORPORATE BONDS (16.0%):
Banking, Finance & Insurance (13.5%):
$ 3,000 Avco Financial Services, 7.25%,
7/15/99.......................... $ 3,045
5,000 Bear Stearns, 6.13%, 2/1/03........ 4,950
1,000 Caterpillar Financial Services,
6.35%, 4/1/99.................... 1,004
3,000 Citicorp, 8.00%, 2/1/03............ 3,221
1,000 Dean Witter Discover & Co., 6.25%,
3/15/00.......................... 1,006
7,000 Ford Motor Credit Corp., 8.38%,
1/15/00.......................... 7,254
1,850 Ford Motor Credit Corp., 7.45%,
4/13/00.......................... 1,899
2,650 GMAC, 7.13%, 5/10/00............... 2,703
5,000 GMAC, 6.75%, 2/7/02................ 5,106
7,000 Goldman Sachs Group, 7.80%,
7/15/02, 144A.................... 7,420
5,000 Goldman Sachs Group, 6.65%, 8/1/03,
144A............................. 5,088
10,000 Greenwich Capital, 7.04%, 12/13/99,
144A............................. 9,997
3,250 HSBC Financial, 7.40%, 4/15/03..... 3,372
4,871 J.P. Morgan Commercial Mortgage
Financial Corp., 6.37%,
1/15/30.......................... 4,916
5,000 Lehman Brothers Holdings, Inc.,
7.63%, 8/1/98.................... 5,005
4,500 Lehman Brothers Holdings, Inc.,
8.88%, 11/1/98................... 4,540
3,000 Lehman Brothers Holdings, Inc.,
10.00%, 5/15/99.................. 3,100
4,000 Lehman Brothers Holdings, Inc.,
9.88%, 10/15/00.................. 4,320
5,000 Visa International, 6.72%, 2/4/02,
144A............................. 5,059
--------
83,005
--------
Industrial Goods & Services (2.5%):
5,000 Avon Products, 6.25%, 5/1/03,
144A............................. 5,038
5,000 Carpenter Technology, 6.28%,
4/7/03........................... 5,019
5,000 Sears Roebuck Co., 6.69%,
8/13/01.......................... 5,087
--------
15,144
--------
Total Corporate Bonds 98,149
--------
OTHER MORTGAGE BACKED SECURITIES (1.5%):
5,150 Evans Withycombe Finance Trust,
Series 1, Class A1, 7.98%,
8/1/01........................... 5,423
3,987 Nomura Mortgage Capital Corp.,
Series 90-1, Class H, 7.00%,
6/17/20.......................... 4,052
--------
Total Other Mortgage Backed Securities 9,475
--------
Continued
17
393
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Limited Volatility Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES (36.6%):
Federal Home Loan Mortgage Corp. (15.6%):
$ 1,628 6.50%, 1/1/01, Pool #M8038......... $ 1,644
8,348 7.00%, 1/1/02, Pool #G50415........ 8,481
9,026 6.50%, 5/1/02, Pool #G50444........ 9,116
289 9.00%, 12/1/05, Pool #G00005....... 302
281 9.00%, 1/1/06, Pool #G00012........ 294
559 8.00%, 10/1/06, Pool #G00052....... 577
1,807 7.00%, 3/1/07, Pool #G34594........ 1,847
2,162 7.50%, 4/1/07, Pool #G00084........ 2,229
1,665 7.00%, 4/1/07, Pool #G00087........ 1,701
2,667 7.50%, 11/1/07, Pool #E00165....... 2,749
3,519 8.50%, 2/1/08, Gold Pool #10133.... 3,667
1,852 7.00%, 12/1/08, Pool #E20065....... 1,895
1,900 8.00%, 1/1/10, Pool #G00355........ 1,960
5,766 8.00%, 2/1/10, Pool #G10328........ 5,950
8,236 7.00%, 10/1/10, Gold Pool
#E61709.......................... 8,416
11,633 7.00%, 5/1/11, Pool #E20241........ 11,898
9,967 6.50%, 5/1/13, Pool #E70383........ 10,036
5,404 5.25%, 9/15/15, REMIC/CMO, Series
1638, Class BC................... 5,392
13,209 8.25%, 12/15/16, REMIC/CMO, Series
1770, Class PD................... 13,455
3,780 6.68%, 10/1/26, Pool #785652....... 3,860
--------
95,469
--------
Federal National Mortgage Assoc. (15.5%):
8,390 6.50%, 8/1/01, Pool #190976........ 8,463
14,156 7.00%, 7/17/05, Series 97-26 Gd.... 14,521
166 9.00%, 9/1/05, Pool #50340......... 174
20,079 6.60%, 10/18/05, Series 97-26 B.... 20,340
171 9.00%, 11/1/05, Pool #50361........ 179
172 8.50%, 4/1/06, Pool #116875........ 179
13,804 7.42%, 9/1/06, Pool #73618......... 14,978
6,150 7.00%, 6/1/10, Pool #315928........ 6,282
5,542 6.50%, 9/1/10, Pool #325479........ 5,598
4,422 6.50%, 10/1/10, Pool #250377....... 4,466
2,692 7.00%, 11/1/10, Pool #250387....... 2,750
2,947 7.50%, 2/1/11, Pool #303755........ 3,037
9,732 6.50%, 4/1/13, Pool #425396........ 9,790
5,000 6.50%, 6/25/13, Series 94-1 K...... 5,064
--------
95,821
--------
Government National Mortgage Assoc. (2.1%):
2 8.00%, 2/15/02, Pool #192917....... 2
17 8.00%, 3/15/02, Pool #209172....... 18
3 9.00%, 6/15/02, Pool #229311....... 3
43 9.00%, 10/15/02, Pool #229569...... 45
12 8.00%, 6/15/05, Pool #28827........ 12
9 9.00%, 9/15/05, Pool #292569....... 9
53 9.00%, 10/15/05, Pool #292589...... 56
14 8.00%, 5/15/06, Pool #303851....... 14
5 8.00%, 7/15/06, Pool #307231....... 5
38 8.00%, 8/15/06, Pool #311166....... 39
36 8.00%, 9/15/06, Pool #311301....... 37
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Government National Mortgage Assoc., continued:
$ 272 8.00%, 10/15/06, Pool #316915...... $ 282
77 8.00%, 11/15/06, Pool #315078...... 80
224 8.00%, 11/15/06, Pool #313528...... 233
97 8.00%, 11/15/06, Pool #316671...... 101
41 8.00%, 11/15/06, Pool #311131...... 42
353 8.00%, 11/15/06, Pool# 312210...... 366
143 8.00%, 12/15/06, Pool #311384...... 149
97 8.00%, 1/15/07, Pool #317663....... 100
258 8.00%, 2/15/07, Pool #316086....... 268
68 8.00%, 3/15/07, Pool #178684....... 71
164 8.00%, 3/15/07, Pool #318825....... 170
128 8.00%, 4/15/07, Pool #316441....... 133
7,567 6.88%, 11/20/25, Pool #8746 ARM.... 7,723
3,013 7.00%, 1/20/26, Pool #8790......... 3,073
--------
13,031
--------
U.S. Government Agencies (3.4%):
20,000 Tennessee Valley Authority, 8.38%,
10/1/99.......................... 20,600
--------
Total U.S. Government Agency Mortgages 224,921
--------
U.S. GOVERNMENT AGENCY SECURITIES (14.5%):
Federal Home Loan Bank (5.8%):
750 5.99%, 8/27/98..................... 750
1,000 5.97%, 8/27/98..................... 1,001
2,000 5.64%, 11/9/98..................... 2,000
4,000 6.60%, 4/13/99 (b)................. 4,030
17,000 5.58%, 2/23/01 (b)................. 16,900
10,000 7.78%, 10/19/01 (b)................ 10,619
--------
35,300
--------
Federal National Mortgage Assoc. (8.7%):
2,000 5.55%, 3/12/99..................... 1,999
4,000 6.35%, 4/8/99...................... 4,022
22,000 5.72%, 3/8/01 (b).................. 22,014
10,000 6.16%, 3/29/01 (b)................. 10,117
15,000 6.50%, 7/16/07..................... 15,687
--------
53,839
--------
Total U.S. Government Agency Securities 89,139
--------
U.S. TREASURY OBLIGATIONS (15.1%):
U.S. Treasury Notes (8.3%):
1,500 6.38%, 1/15/99 (b)................. 1,506
3,000 6.50%, 4/30/99 (b)................. 3,025
16,300 5.88%, 11/15/99 (b)................ 16,377
3,500 8.50%, 2/15/00 (b)................. 3,660
4,000 8.88%, 5/15/00 (b)................. 4,239
1,250 6.13%, 9/30/00 (b)................. 1,266
15,000 6.38%, 9/30/01 (b)................. 15,361
5,000 6.25%, 8/31/02 (b)................. 5,130
--------
50,564
--------
Continued
18
394
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Limited Volatility Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. TREASURY OBLIGATIONS, CONTINUED:
U.S. Treasury STRIPS (6.8%):
$17,500 2/15/00 (b)........................ $ 16,040
18,500 11/15/01 (b)....................... 15,422
15,500 7/15/05............................ 10,486
--------
41,948
--------
Total U.S. Treasury Obligations 92,512
--------
YANKEE & EURODOLLAR (0.8%):
5,000 Peoples Republic of China, 7.38%,
7/3/01 (b)....................... 5,031
--------
Total Yankee & Eurodollar 5,031
--------
REPURCHASE AGREEMENTS (0.8%):
4,688 Prudential Securities, 6.10%,
7/1/98, (Collateralized by $4,825
U.S. Treasury Bills, 9/3/98,
market value $4,782)............. 4,688
--------
Total Repurchase Agreements 4,688
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (9.0%):
Master Notes (1.5%):
2,527 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*.................. 2,527
1,684 Danaher Corp., 6.68%, 10/9/98*..... 1,684
2,527 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................. 2,527
2,274 NationsBanc Capital Markets, 6.70%,
7/1/98*.......................... 2,274
--------
9,012
--------
Put Bonds (1.0%):
2,527 Citicorp, 5.94%, 8/3/98*........... 2,527
1,684 GMAC, 5.85%, 11/10/99*............. 1,687
1,684 Greenwich Capital, 6.11%,
12/13/99*........................ 1,684
--------
5,898
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements (6.5%):
$ 9,264 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$9,472 various Corporate and
Government Securities,
2.85% - 17.25%, 10/15/02 -
4/15/35, market value $9,621).... $ 9,264
8,422 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $8,977 various
Corporate Bonds, 0.00%, 7/7/98 -
9/18/98, market value $8,944).... 8,422
18,530 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $18,993
various Corporate Bonds,
0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$19,880)......................... 18,530
1,735 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $1,822 Media
One Group Bonds, 0.00%, 10/5/98,
market value $1,822)............. 1,735
2,190 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $13,709
various Government Securities,
0.00% - 10.00%, 12/1/18 - 5/1/24,
market value $2,254)............. 2,190
--------
40,141
--------
Total Short-Term Securities Held as
Collateral 55,051
--------
Total (Cost $654,845) (a) $664,245
========
- ------------
Percentages indicated are based on net assets of $613,102.
(a) Represents cost for financial reporting and federal income tax purposes and
differs from value by net unrealized appreciation of securities as follows
(amounts in thousands):
Unrealized appreciation..................................... $9,537
Unrealized depreciation..................................... (137)
------
Net unrealized appreciation................................. $9,400
======
(b) A portion of this security was loaned as of June 30, 1998.
* The interest rate, for this variable rate note, which will change
periodically, is based upon prime rates or an index of market rates. The rate
reflected on the Schedule of Portfolio Investments is the rate in effect at
June 30, 1998.
ARM Adjustable Rate Mortgage
CMO Collateralized Mortgage Obligation
REMIC Real Estate Mortgage Investment Conduit
See notes to financial statements.
19
395
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
ASSET BACKED SECURITIES (8.7%):
$ 1,000 Advanta Credit Card Master Trust,
Series 96-A, 6.00%, 11/15/05..... $ 1,025
309 Advanta Mortgage Loan Trust, Series
94-4, Class A1, 8.55%,
11/25/12......................... 314
5,000 Aesop Funding II, Series 97-1,
Class A2, 6.40%, 10/20/03........ 5,041
2,622 Aircraft Lease Portfolio
Securitization Ltd., Series 94-1,
Class A2, 7.15%, 9/15/04......... 2,639
552 Chase Manhattan Guarantor Trust,
Series 96-A, Class A, 5.20%,
2/15/02.......................... 550
5,440 Circuit City Credit Card Master
Trust, Series 95-1, Class A,
6.38%,
8/15/05.......................... 5,505
6,000 EQCC Home Equity Loan Trust, Series
96-4, Class A6, 6.88%,
7/15/14.......................... 6,180
2,000 First Bank Corporate Card Master
Trust, Series 97-1, Class B,
6.55%, 2/15/03................... 2,054
4,000 Greentree Financial Corp., Series
93-2, Class B, 8.00%, 7/15/18.... 4,200
3,000 Greentree Financial Home
Improvement Corp., Series 97-D,
Class HIA2, 6.45%, 10/15/23...... 3,030
5,000 Greentree Home Improvement Loan
Trust, Series 95-D, 6.95%,
9/15/25.......................... 5,075
10,000 KeyCorp Auto, Series 97-2A4, 6.15%,
10/15/01......................... 10,041
750 Prime Credit Card Master Trust,
Series 96-1, 6.70%, 7/15/04...... 767
5,000 Rental Car Finance, Series 97-1,
Class A2, 6.45%, 8/25/04......... 5,063
467 Sears Credit Account Master Trust,
Series 95-4, Class A, 6.25%,
1/15/03.......................... 468
4,000 Team Fleet Financing Corp., Series
97-1, Class A, 7.35%, 5/15/03.... 4,139
350 UFSB, Series 94-B, Class B, 6.43%,
7/10/00.......................... 350
2,296 Union Acceptance Corp., Series
95-D, 6.03%, 1/7/03.............. 2,296
6,000 World Financial Network Credit
Card, Series 96-1, Class A,
6.70%,
2/15/04.......................... 6,138
--------
Total Asset Backed Securities 64,875
--------
CORPORATE BONDS (20.0%):
Banking, Finance & Insurance (8.8%):
5,000 Bankers' Trust, 7.25%, 1/15/03..... 5,206
4,000 Capital One Bank, 6.61%, 6/22/99... 4,010
3,000 First Hawaiian, Inc., 6.25%,
8/15/00.......................... 3,008
1,000 Ford Motor Credit Corp., 6.63%,
6/30/03.......................... 1,023
4,000 General Motors Acceptance Corp.,
5.88%, 1/22/03................... 3,940
10,000 Goldman Sachs Group, 6.38%,
6/15/00.......................... 10,074
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
CORPORATE BONDS, CONTINUED:
Banking, Finance & Insurance, continued:
$ 5,000 Greenwich Capital, 7.04%, 12/13/99,
Private Placement................ $ 4,999
5,000 International Lease, 6.38%,
8/1/02........................... 5,063
3,000 Lehman Brothers Holdings, Inc.,
9.88%, 10/15/00.................. 3,240
5,000 Lehman Brothers Holdings, Inc.,
8.88%, 3/1/02.................... 5,431
3,000 Lehman Brothers Holdings, Inc.,
7.25%, 4/15/03................... 3,124
6,000 Liberty Mutual Insurance, 8.20%,
5/4/07........................... 6,697
5,000 MBNA Corp., 6.29%, 5/23/03*........ 5,015
4,000 Metropolitan Life, 7.00%,
11/1/05.......................... 4,130
--------
64,960
--------
Gas & Electric Utility (1.4%):
2,500 Duke Power Co., 7.00%, 6/1/00...... 2,550
1,931 Kern River Fund, 6.42%, 3/31/01
(b).............................. 1,942
6,000 Ohio Power, 6.73%, 11/1/04......... 6,172
--------
10,664
--------
Industrial Goods & Services (5.1%):
5,000 Atlas Copco AB, 6.50%, 4/1/08...... 5,025
5,000 Cox Radio, Inc., 6.38%, 5/15/05,
Series 144A...................... 5,038
5,000 Excel Paralubes Funding, 7.13%,
11/1/11.......................... 5,255
2,000 Limited, Inc., 8.88%, 8/15/99...... 2,055
600 Lockheed Martin Corp., 9.38%,
10/15/99......................... 625
4,000 Oracle Corp., 6.72%, 2/15/04....... 4,105
5,000 Sears Roebuck Acceptance, Series
MTN3, 7.07%, 9/18/01............. 5,143
5,000 Thomas & Betts, Series MTN, 6.29%,
2/13/03.......................... 5,000
5,000 Tyco International Group SA, 6.25%,
6/15/03.......................... 4,988
650 VF Corp., 6.63%, 3/15/03........... 663
--------
37,897
--------
Real Estate (1.2%):
5,000 Meditrust, 7.60%, 7/15/01.......... 5,150
4,000 Prime Properties Funding, 6.80%,
8/15/02.......................... 4,080
--------
9,230
--------
Telecommunications (0.5%):
4,000 Cable & Wire Communications, 6.63%,
3/6/05........................... 4,045
--------
Yankee & Eurodollar (3.0%):
5,000 Avon Energy Partners, 7.05%,
12/11/07, Series 144A............ 5,200
3,000 D.R. Investments, 7.10%, 5/15/02... 3,090
4,000 Dao Heng Bank, 7.75%, 1/24/07...... 3,245
2,000 Kingdom of Thailand, 7.75%,
4/15/07 (b)...................... 1,788
Continued
20
396
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
CORPORATE BONDS, CONTINUED:
Yankee & Eurodollar, continued:
$ 500 Nippon Telephone & Telegraph,
9.50%, 7/27/98................... $ 501
6,225 Petronas, 6.88%, 7/1/03 (b)........ 5,517
3,000 Ras Laffan Gas, 7.63%, 9/15/06..... 2,906
--------
22,247
--------
Total Corporate Bonds 149,043
--------
OTHER MORTGAGE BACKED SECURITIES (3.7%):
1,657 BHN, Series 97-1, Class A2, 7.92%,
7/25/09.......................... 1,641
4,000 Equitable, Series 174, Class A1,
7.24%, 5/15/06, Private
Placement........................ 4,258
2,000 J.P. Morgan & Co., Series 97, Class
C4, 7.47%, 12/26/28.............. 2,134
5,000 JPMC, Series 96-C2, Class B, 6.80%,
11/25/27......................... 5,113
5,000 MLMI, Series 97-C2 A2, 6.54%,
12/10/29......................... 5,140
4,000 Mortgage Capital Funding Inc.,
Series 96-MC2, Class A3, 7.08%,
9/20/06.......................... 4,188
1,740 Prudential Home Mortgage
Securities, 6.50%, 5/25/00....... 1,737
3,022 Wells Fargo Capital Markets, Series
96-1, Class A1, 6.56%,
12/29/05......................... 3,056
--------
Total Other Mortgage Backed Securities 27,267
--------
U.S. GOVERNMENT AGENCY MORTGAGES (40.4%):
Federal Home Loan Mortgage Corp. (15.5%):
9,294 6.50%, 10/1/04, Gold Pool
#M80495.......................... 9,384
2,000 7.00%, 6/15/06, Series #1457-PH,
CMO.............................. 2,035
49 8.00%, 4/1/07, Pool #160022........ 51
806 7.50%, 8/1/08, Gold Pool #G10117... 831
9,622 6.00%, 12/15/08, Series #1624,
CMO.............................. 9,595
2,897 8.50%, 1/1/10, Gold Pool #G10305... 3,019
1,450 8.50%, 1/1/10, Gold Pool #E00356... 1,511
203 7.00%, 8/1/10, Gold Pool #E20187... 208
3,165 7.00%, 9/1/10, Gold Pool #E00393... 3,237
2,873 7.50%, 7/1/11, Gold Pool #E20253... 2,964
8,733 7.00%, 9/1/12, Gold Pool #E00506... 8,896
6,753 6.50%, 1/1/13, Pool #E68904........ 6,799
9,798 6.50%, 4/1/13, Gold Pool #E69986... 9,865
5,029 6.50%, 4/1/13, Pool #E00542........ 5,064
8,000 8.00%, 2/15/20, Gold Series
#1770-PE, CMO.................... 8,185
3,000 6.00%, 4/15/20, Series #1534-F,
CMO.............................. 2,970
540 8.00%, 7/1/20, Gold Pool #A01047... 564
9,440 6.50%, 10/15/21, Series #1590-GA,
CMO.............................. 9,596
25 7.00%, 4/1/22, Pool #D17544........ 26
2,187 8.00%, 8/1/24, Pool #G00245........ 2,270
1,934 8.00%, 11/1/24, Gold Pool
#C00376.......................... 2,007
3,206 7.50%, 8/1/25, Gold Pool #C00414... 3,297
3,362 7.00%, 4/1/26, Pool #C00452........ 3,423
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED
Federal Home Loan Mortgage Corp., continued:
$ 3,107 6.98%, 7/1/26, Pool #785618........ $ 3,127
7,038 7.50%, 1/15/27, Series 1927, CMO... 7,544
9,968 6.50%, 3/1/28, Pool #D87734........ 9,938
--------
116,406
--------
Federal National Mortgage Assoc. (11.4%):
2 6.50%, 12/1/02, Pool #6345......... 2
1,511 8.00%, 9/25/04, Series 91-155G..... 1,544
1,504 6.75%, 12/25/04, Series 93-6C,
CMO.............................. 1,511
10,944 6.88%, 9/1/05, Pool #73192......... 11,408
7,613 6.95%, 4/1/06, Pool #73429......... 8,013
1,500 7.05%, 6/25/06, Series 93-11, Class
G................................ 1,516
515 7.00%, 1/1/07, Pool #145771........ 526
2,500 7.50%, 8/25/07, Series G92-48,
Class H, CMO..................... 2,553
189 7.50%, 11/1/09, Pool #158.......... 195
2,152 7.00%, 6/1/10, Pool #312903........ 2,198
3,741 6.50%, 12/1/10, Pool #322598....... 3,778
1,481 6.50%, 4/1/11, Pool #337903........ 1,496
199 7.50%, 5/1/14, Pool #57930......... 207
513 5.70%, 8/25/16, Series G93-39,
Class A, CMO..................... 508
91 7.00%, 4/1/17, Pool #44696......... 93
459 7.95%, 8/25/19, Series 90-14,
CMO.............................. 468
500 6.25%, 11/25/19, Series G93-32,
Class PG......................... 501
87 8.00%, 3/1/21, Pool #70825......... 91
2,000 5.00%, 5/25/22, Series G93-10,
Class G, CMO..................... 1,911
2,721 7.50%, 11/1/22, Pool #189190....... 2,807
9,700 6.00%, 3/25/23, Series 93-41....... 9,736
1,756 8.00%, 5/1/24, Pool #250066........ 1,825
3,232 8.50%, 7/1/24, Pool #250103........ 3,386
2,245 7.50%, 10/1/24, Pool #303031....... 2,312
754 8.50%, 5/1/25, Pool #308499........ 791
153 7.50%, 5/1/25, Pool #293928........ 158
664 7.50%, 5/1/25, Pool #311810........ 684
930 8.50%, 6/1/25, Pool #315277........ 976
2,763 7.00%, 7/1/25, Pool #290387........ 2,812
3,263 7.00%, 7/1/25, Pool #312931........ 3,321
3,931 7.13%, 6/1/26, Pool #341503........ 4,012
4,611 7.00%, 9/1/27, Pool #313687........ 4,698
9,000 6.00%, 11/1/27, Series 97-79,
Class PE......................... 8,806
--------
84,843
--------
Government National Mortgage Assoc. (13.5%):
3 11.00%, 6/15/99, Pool #110948...... 3
4 11.00%, 3/15/00, Pool #123750...... 4
5 10.00%, 12/15/00, Pool #136214..... 5
44 10.00%, 1/15/01, Pool #145167...... 46
33 10.00%, 1/15/01, Pool #145328...... 34
7 9.00%, 6/15/01, Pool #166985....... 7
1 9.00%, 6/15/01, Pool #164431....... 1
4 9.00%, 6/15/01, Pool #161443....... 4
3 8.50%, 6/15/01, Pool #162447....... 4
32 8.50%, 6/15/01, Pool #137056....... 33
57 6.50%, 6/15/01, Pool #1305......... 57
Continued
21
397
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED
Government National Mortgage Assoc., continued:
$ 7 9.00%, 7/15/01, Pool #155822....... $ 7
36 9.00%, 8/15/01, Pool #173460....... 37
49 8.50%, 8/15/01, Pool #164207....... 52
5 9.00%, 9/15/01, Pool #177121....... 5
48 9.00%, 10/15/01, Pool #179852...... 51
6 9.00%, 10/15/01, Pool #185596...... 6
3 9.00%, 10/15/01, Pool #177634...... 4
69 9.00%, 11/15/01, Pool #191819...... 72
8 9.00%, 11/15/01, Pool #174365...... 9
3 8.50%, 11/15/01, Pool #183462...... 3
43 8.50%, 12/15/01, Pool #199182...... 45
35 8.50%, 12/15/01, Pool #199837...... 37
9 8.50%, 12/15/01, Pool #182959...... 10
7 9.00%, 1/15/02, Pool #205001....... 8
40 8.00%, 3/15/02, Pool #210065....... 42
56 8.00%, 3/15/02, Pool #205933....... 59
39 8.50%, 5/15/02, Pool #213776....... 41
23 8.00%, 5/15/02, Pool #203042....... 24
51 8.00%, 5/15/02, Pool #180296....... 53
68 8.50%, 6/15/02, Pool #2297......... 71
30 9.00%, 8/15/02, Pool #232424....... 31
36 9.00%, 10/15/02, Pool #246307...... 38
9 9.00%, 11/15/02, Pool #235553...... 9
3 9.00%, 6/15/03, Pool #247863....... 3
31 8.50%, 9/15/04, Pool #274390....... 32
74 9.00%, 10/15/04, Pool #281655...... 77
47 9.00%, 10/15/04, Pool #229506...... 49
45 8.50%, 10/15/04, Pool #277469...... 47
90 8.50%, 11/15/04, Pool #253471...... 94
70 9.00%, 5/15/05, Pool #288771....... 74
26 9.00%, 6/15/05, Pool #283904....... 27
36 9.00%, 8/15/05, Pool #297031....... 38
29 9.50%, 10/15/05, Pool #291846...... 31
12 9.00%, 10/15/05, Pool #292589...... 12
75 9.00%, 11/15/05, Pool #292610...... 79
33 9.00%, 11/15/05, Pool #299161...... 35
30 9.00%, 12/15/05, Pool #299569...... 32
61 7.50%, 2/15/06, Pool #7855......... 64
70 8.50%, 4/15/06, Pool #307487....... 73
46 7.50%, 6/15/06, Pool #7855......... 48
29 8.00%, 10/15/06, Pool #11503....... 30
55 8.00%, 1/15/07, Pool #14709........ 58
25 7.50%, 4/15/07, Pool #16991........ 26
222 7.50%, 5/15/07, Pool #329528....... 230
62 7.50%, 7/15/07, Pool #17316........ 64
119 7.50%, 8/15/07, Pool #19015........ 124
21 9.00%, 1/15/09, Pool #26076........ 23
111 9.00%, 4/15/09, Pool #30352........ 120
72 8.00%, 5/15/09, Pool #385676....... 74
4,030 6.50%, 7/15/09, Pool #780316....... 4,097
19 8.00%, 8/15/09, Pool #372143....... 20
37 9.50%, 10/15/09, Pool #36582....... 40
543 8.00%, 10/15/09, Pool #380639...... 563
1,249 7.50%, 2/15/12, Pool #393363....... 1,291
1,875 7.50%, 3/15/12, Pool #399163....... 1,938
1,217 7.50%, 3/15/12, Pool #441145....... 1,258
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED
Government National Mortgage Assoc., continued:
$ 39 10.50%, 2/15/13, Pool #6507........ $ 43
2 12.00%, 1/15/15, Pool #112920...... 2
61 9.00%, 8/15/16, Pool #164502....... 66
36 9.50%, 9/15/16, Pool #158201....... 40
15 9.00%, 9/15/16, Pool #168987....... 16
15 9.00%, 9/15/16, Pool #175362....... 16
46 9.00%, 9/15/16, Pool #179044....... 50
57 9.00%, 12/15/16, Pool #198652...... 62
44 9.50%, 1/15/17, Pool #185619....... 48
114 8.50%, 1/15/17, Pool #203625....... 122
23 9.00%, 3/15/17, Pool #180330....... 25
8 8.50%, 3/15/17, Pool #196700....... 8
190 8.50%, 5/15/17, Pool #217536....... 203
9 8.50%, 6/15/17, Pool #188545....... 10
2,179 8.50%, 11/15/17, Pool #780086...... 2,340
141 9.00%, 7/15/18, Pool #226769....... 153
7 9.50%, 9/15/18, Pool #258627....... 8
37 9.50%, 12/15/18, Pool #229531...... 40
27 9.50%, 10/15/19, Pool # 279630..... 29
60 9.00%, 11/15/19, Pool #279649...... 65
129 9.50%, 2/15/20, Pool #281655....... 140
36 9.00%, 2/15/20, Pool #286315....... 39
46 9.50%, 9/15/20, Pool #292918....... 51
37 9.00%, 7/15/21, Pool #311256....... 40
145 8.00%, 4/15/22, Pool #325461....... 151
226 8.00%, 5/15/22, Pool #317346....... 237
77 8.00%, 5/15/22, Pool #320675....... 80
11 8.00%, 5/15/22, Pool #317358....... 12
2,300 8.00%, 7/15/22, Pool #426612....... 2,390
366 8.00%, 7/15/22, Pool #183670....... 382
451 7.50%, 8/15/22, Pool #333881....... 467
1,592 7.00%, 8/15/23, Pool #352108....... 1,625
6,595 7.00%, 9/15/23, Pool #363030....... 6,735
2,240 7.00%, 11/15/23, Pool #352022...... 2,288
8,362 6.50%, 1/15/24, Pool #366706....... 8,406
10,346 7.00%, 2/15/24, Pool #371281....... 10,562
2,917 9.00%, 11/15/24, Pool #780029...... 3,170
1,722 7.50%, 1/15/26, Pool #416874....... 1,778
1,655 7.50%, 3/15/26, Pool #422292....... 1,708
2,487 7.50%, 4/15/26, Pool #426059....... 2,565
1,587 8.00%, 7/15/26, Pool #428509....... 1,649
2,644 7.50%, 11/15/26, Pool #442119...... 2,723
9,615 7.00%, 6/15/27, Pool #780584....... 9,804
3,768 7.50%, 7/15/27, Pool #442119....... 3,876
4,793 7.50%, 7/15/27, Pool #411829....... 4,931
9,975 6.00%, 3/20/28, Pool #2562......... 9,700
10,000 7.00%, 4/15/28, Pool # 426691...... 10,158
--------
100,696
--------
Total U.S. Government Agency Mortgages 301,945
--------
U.S. GOVERNMENT AGENCY SECURITIES (0.1%):
Federal Home Loan Bank (0.1%):
800 7.06%, 2/12/99..................... 807
--------
Total U.S. Government Agency Securities 807
--------
Continued
22
398
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. TREASURY OBLIGATIONS (24.7%):
U.S. Treasury Bonds (6.5%):
$ 3,000 10.75%, 5/15/03 (b)................ $ 3,656
13,000 7.50%, 11/15/16 (b)................ 15,608
3,000 8.75%, 5/15/17 (b)................. 4,041
11,000 8.13%, 8/15/19 (b)................. 14,186
10,000 6.25%, 8/15/23 (b)................. 10,715
--------
48,206
--------
U.S. Treasury Inflation Protected Bonds (1.3%):
10,256 3.38%, 1/15/07 (b)................. 9,935
--------
U.S. Treasury Notes (15.9%):
5,000 8.25%, 7/15/98 (b)................. 5,006
4,000 4.75%, 8/31/98 (b)................. 3,998
3,000 8.88%, 11/15/98 (b)................ 3,038
3,000 5.88%, 3/31/99..................... 3,009
6,000 8.00%, 8/15/99 (b)................. 6,163
10,000 7.50%, 10/31/99 (b)................ 10,250
1,000 7.88%, 11/15/99 (b)................ 1,031
16,000 5.63%, 11/30/99 (b)................ 16,027
5,000 7.75%, 1/31/00 (b)................. 5,167
3,000 6.75%, 4/30/00 (b)................. 3,064
6,000 5.88%, 6/30/00 (b)................. 6,044
3,000 6.13%, 7/31/00 (b)................. 3,036
1,000 8.75%, 8/15/00..................... 1,064
5,000 7.75%, 2/15/01 (b)................. 5,268
5,000 6.25%, 10/31/01 (b)................ 5,105
7,000 7.50%, 11/15/01 (b)................ 7,414
7,000 6.25%, 2/28/02 (b)................. 7,159
11,000 5.75%, 8/15/03 (b)................. 11,121
6,000 7.25%, 5/15/04 (b)................. 6,511
5,000 7.25%, 8/15/04 (b)................. 5,438
4,000 7.88%, 11/15/04 (b)................ 4,493
--------
119,406
--------
U.S. Treasury STRIPS (1.0%):
20,000 5/15/16............................ 7,249
--------
Total U.S. Treasury Obligations 184,796
--------
REPURCHASE AGREEMENTS (1.5%):
10,855 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $11,011
various U.S. Government
Securities, 5.63% - 6.10%,
11/30/99 - 6/26/03, market value
$11,073)......................... 10,855
--------
Total Repurchase Agreements 10,855
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL (16.5%):
Master Notes (2.7%):
$ 5,638 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*.................. $ 5,638
3,759 Danaher Corp., 6.68%, 10/9/98*..... 3,759
5,639 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*.................. 5,639
5,075 NationsBanc Capital Markets, 6.70%,
7/1/98*.......................... 5,075
--------
20,111
--------
Put Bonds (1.8%):
5,639 Citicorp, 5.94%, 8/3/98*........... 5,639
3,759 GMAC, 5.85%, 11/10/99*............. 3,764
3,759 Greenwich Capital, 6.11%,
12/13/99*........................ 3,759
--------
13,162
--------
Repurchase Agreements (12.0%):
20,674 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$21,137 various Corporate and
Government Securities,
2.85% - 17.25%, 10/15/02 -
4/15/35, market value $21,470)... 20,674
18,795 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $20,032
various Corporate Bonds, 0.00%,
7/7/98 - 9/18/98, market value
$19,960)......................... 18,795
41,349 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $42,384
various Corporate Bonds,
0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$44,363)......................... 41,349
3,872 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $4,067 Media
One Group Bonds, 0.00%, 10/5/98,
market value $4,067)............. 3,872
4,887 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $30,592
various Government Securities,
0.00% - 10.00%, 12/1/18 - 5/1/24,
market value $5,030)............. 4,887
--------
89,577
--------
Total Short-Term Securities Held as
Collateral 122,850
--------
Total (Cost $848,429) (a) $862,438
========
Continued
23
399
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Intermediate Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
- ------------
Percentages indicated are based on net assets of $746,159.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $98. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $ 16,730
Unrealized depreciation..................................... (2,819)
--------
Net unrealized appreciation................................. $ 13,911
========
(b) A portion of this security was loaned as of June 30, 1998.
* The interest rate, for this variable rate note, which will change
periodically, is based upon prime rates or an index of market rates. The rate
reflected on the Schedule of Portfolio Investments is the rate in effect at
June 30, 1998.
CMO Collateralized Mortgage Obligation
See notes to financial statements.
24
400
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Government Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES (73.0%):
Federal Home Loan Mortgage Corp. (27.1%):
$ 7,389 6.00%, 4/15/01, Gold Balloon, Pool
#G50347.......................... $ 7,393
1,000 7.00%, 10/15/06, Series 1150, Class
I................................ 1,023
4,508 7.50%, 4/1/09, Gold Pool #E00315... 4,650
16,500 6.50%, 9/15/09, Series 1838 G,
CMO.............................. 16,723
3,090 8.50%, 1/1/10, Gold Pool #G10305... 3,220
9,849 6.50%, 3/1/13, Pool #E00538........ 9,917
31,272 6.50%, 4/1/13, Pool #E00542........ 31,486
11,912 6.00%, 4/1/13, Pool# E00543........ 11,801
211 9.00%, 10/1/17, Gold Pool
#A00756.......................... 225
169 9.00%, 4/1/18, Gold Pool #A01143... 180
44 9.00%, 10/1/20, Gold Pool
#A01134.......................... 47
55 9.00%, 1/1/21, Gold Pool #A00948... 59
500 7.25%, 2/15/21, Series 1464, CMO... 509
54 9.00%, 4/1/21, Gold Pool #D04193... 58
83 9.00%, 6/1/21, Gold Pool #A01017... 88
86 9.00%, 7/1/21, Gold Pool #A01093... 92
45 9.00%, 9/1/21, Gold Pool #D32271... 48
85 9.00%, 11/1/21, Gold Pool
#D11191.......................... 91
89 9.00%, 11/1/21, Gold Pool
#D11866.......................... 95
52 9.00%, 11/1/21, Gold Pool
#C00078.......................... 56
172 9.00%, 5/1/22, Gold Pool #D19203... 184
75 9.00%, 5/1/22, Gold Pool #D19142... 80
900 7.00%, 8/25/22, Series 13, Class
PL............................... 933
10,000 5.50%, 9/15/22, Series 1367-K...... 9,480
3,729 7.00%, 4/15/23, Pool #348645....... 3,809
6,272 10.00%, 10/15/23, Series 1591 E,
CMO.............................. 7,096
8,837 6.00%, 10/15/23, Series 1785A...... 8,613
17,851 5.00%, 11/15/23, Series 1686 PG,
CMO.............................. 17,161
9,268 6.50%, 1/1/24, Gold Pool #C80091... 9,280
3,636 8.50%, 5/1/24, Gold Pool #G00229... 3,836
3,088 8.50%, 7/1/24, Gold Pool #C00354... 3,235
4,545 7.50%, 9/1/24, Gold Pool #D56307... 4,674
4,835 8.00%, 11/1/24, Gold Pool
#C00376.......................... 5,018
3,206 7.50%, 8/1/25, Gold Pool #C00414... 3,297
3,991 7.00%, 8/1/25, Gold Pool #C00418... 4,066
3,691 8.00%, 9/1/25, Gold Pool #D63705... 3,831
3,823 7.00%, 9/1/25, Gold Pool #D63303... 3,894
8,578 6.50%, 2/1/26, Gold Pool #D68098... 8,578
8,730 6.50%, 3/1/26, Gold Pool #G00453... 8,730
10,733 7.00%, 4/1/26, Gold Pool #D69811... 10,928
4,539 6.50%, 6/1/26, Pool #250575........ 4,532
10,000 6.50%, 10/17/26, Series 1985,
Class PL......................... 10,250
14,975 6.50%, 4/1/28, Gold Pool #D89085... 14,928
10,000 6.50%, 6/1/28, #C10103............. 9,969
--------
244,163
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Federal National Mortgage Assoc. (19.9%):
$ 8,222 6.00%, 3/1/01, Pool #50783......... $ 8,199
6,494 7.00%, 4/1/03, Pool #303876........ 6,585
758 7.50%, 5/1/03, Pool #347175........ 771
1,838 7.50%, 7/1/03, Pool #250656........ 1,870
6,360 7.00%, 7/17/05, Series 97-26 GD.... 6,524
3,227 7.00%, 4/1/08, Pool #211750........ 3,297
8,000 6.00%, 6/25/09, Series 1994-86 PJ,
CMO.............................. 7,975
3,186 7.00%, 7/1/10, Pool #250326........ 3,255
2,172 6.50%, 12/1/10, Pool #332301....... 2,194
12,215 6.00%, 3/1/11, Pool #340683........ 12,147
9,394 6.00%, 1/17/13, Series 98-37 VB,
CMO.............................. 9,256
10,000 6.50%, 6/25/13, Series 94-1 K...... 10,129
3,596 6.35%, 8/25/13, Series 1993-225B
VG, CMO.......................... 3,622
3,429 7.50%, 6/1/14, Pool #250081........ 3,532
2,761 7.50%, 7/1/14, Pool #250082........ 2,844
124 10.00%, 10/1/16, Pool #70110....... 135
5,963 10.00%, 9/1/17, Pool #303969....... 6,477
342 10.00%, 10/1/19, Pool #231675...... 372
8,169 7.00%, 5/25/20, Series 1990-57..... 8,330
216 10.00%, 7/1/20, Pool #050318....... 235
5,584 6.50%, 5/25/21, Series 1992-205 K,
CMO.............................. 5,618
5,000 7.00%, 9/25/21, Series G92-64 K,
CMO.............................. 5,045
374 10.00%, 11/1/21, Pool #208374...... 407
523 10.00%, 11/1/21, Pool #208372...... 569
5,000 6.55%, 12/25/21, Pool #1993-137 PH,
CMO.............................. 5,046
1,000 7.25%, 5/25/22, Series G93-9, Class
K................................ 1,022
800 7.50%, 7/25/22, Series G92-35,
CMO.............................. 823
10,785 6.50%, 2/17/23, Series #G94-12 C,
CMO.............................. 10,545
5,000 6.50%, 5/25/23, Series 1994-110 H,
CMO.............................. 4,985
9,094 6.35%, 12/25/23, Series 1994-43 PJ,
CMO.............................. 9,085
5,042 7.00%, 1/25/24, Series 1994-62 PJ,
CMO.............................. 5,205
7,453 7.00%, 2/1/24, Pool #190257........ 7,590
2,525 9.00%, 12/1/24, Pool #353898....... 2,671
3,905 7.00%, 8/1/25, Pool #315500........ 3,975
19,867 6.50%, 3/1/28, Pool #251613........ 19,786
--------
180,121
--------
Government National Mortgage Assoc. (26.0%):
9 10.00%, 9/15/00, Pool #138814...... 10
7 10.00%, 12/15/00, Pool #136214..... 7
28 8.50%, 6/15/01, Pool #166491....... 29
3 8.50%, 7/15/01, Pool #161997....... 3
Continued
25
401
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Government Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Government National Mortgage Assoc., continued:
$ 41 9.50%, 9/15/01, Pool #180786....... $ 43
4 9.00%, 9/15/01, Pool #174330....... 4
52 9.00%, 9/15/01, Pool #166928....... 55
8 9.50%, 11/15/01, Pool #182995...... 9
48 8.50%, 11/15/01, Pool #179383...... 50
37 9.00%, 12/15/01, Pool #187723...... 39
35 8.50%, 12/15/01, Pool #199837...... 37
56 8.00%, 3/15/02, Pool #205933....... 59
133 9.00%, 5/15/03, Pool #154134....... 139
105 9.00%, 6/15/05, Pool #283904....... 110
41 9.00%, 8/15/05, Pool #291836....... 43
37 9.00%, 9/15/05, Pool #292898....... 39
16 9.00%, 9/15/05, Pool #295227....... 17
54 8.00%, 7/15/06, Pool #11337........ 57
26 7.50%, 7/15/07, Pool #17316........ 27
63 8.00%, 8/15/07, Pool #18677........ 66
41 8.00%, 8/15/07, Pool #18539........ 43
209 7.50%, 12/15/07, Pool #338189...... 216
46 9.00%, 11/15/08, Pool #27932....... 49
83 9.00%, 4/15/09, Pool #30352........ 90
13 9.00%, 5/15/09, Pool #32214........ 14
4 9.50%, 7/15/09, Pool #34487........ 4
107 9.50%, 9/15/09, Pool #34878........ 116
32 9.50%, 10/15/09, Pool #36804....... 35
19 11.00%, 11/15/09, Pool #37615...... 21
1 12.00%, 4/15/15, Pool #125262...... 1
12 11.00%, 6/15/15, Pool #130125...... 14
64 9.00%, 5/15/16, Pool #149877....... 70
61 9.00%, 6/15/16, Pool #166130....... 67
12 9.50%, 7/15/16, Pool #166772....... 13
83 9.00%, 7/15/16, Pool #158921....... 90
74 9.50%, 8/15/16, Pool #177531....... 81
129 9.00%, 9/15/16, Pool #179044....... 140
17 9.50%, 1/15/17, Pool #185619....... 18
238 9.00%, 2/15/17, Pool #195058....... 259
237 9.00%, 6/15/17, Pool #219079....... 257
45 9.50%, 8/15/17, Pool #218841....... 49
42 9.50%, 8/15/17, Pool #224015....... 46
20 9.00%, 8/15/17, Pool #225825....... 21
88 9.00%, 6/15/18, Pool #238161....... 95
57 9.50%, 8/15/18, Pool #248390....... 62
19 9.00%, 10/15/18, Pool #253188...... 20
113 9.50%, 12/15/18, Pool #263400...... 123
3 9.00%, 10/15/19, Pool #267676...... 3
54 9.00%, 11/15/19, Pool #162768...... 58
65 9.00%, 1/15/20, Pool #283138....... 70
44 9.00%, 2/15/20, Pool #276157....... 48
123 9.00%, 3/15/20, Pool #285283....... 133
46 9.50%, 9/15/20, Pool #292918....... 51
72 9.50%, 12/15/20, Pool #291865...... 79
242 9.00%, 6/15/21, Pool #307120....... 263
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Government National Mortgage Assoc., continued:
$11,908 9.00%, 8/15/21, Pool #306081....... $ 12,937
3,522 9.00%, 12/15/21, Pool #780284...... 3,783
28 7.50%, 2/15/22, Pool #324025....... 29
402 8.00%, 7/15/22, Pool #321560....... 420
709 7.50%, 8/15/22, Pool #337141....... 733
31 7.00%, 10/15/22, Pool #337175...... 32
191 7.00%, 11/15/22, Pool #323008...... 195
30 7.00%, 12/15/22, Pool #339969...... 31
405 7.00%, 1/15/23, Pool #332022....... 414
388 7.00%, 1/15/23, Pool #342248....... 396
38 7.00%, 1/15/23, Pool #321675....... 38
233 7.00%, 1/15/23, Pool #346214....... 238
372 7.00%, 1/15/23, Pool #341536....... 380
47 7.00%, 3/15/23, Pool #350110....... 48
734 7.00%, 5/15/23, Pool #346572....... 750
692 7.00%, 5/15/23, Pool #351041....... 707
729 7.00%, 5/15/23, Pool #342348....... 744
55 7.00%, 5/15/23, Pool #338005....... 57
615 7.00%, 5/15/23, Pool #221604....... 628
320 6.50%, 5/15/23, Pool #343208....... 321
360 6.50%, 6/15/23, Pool #348677....... 362
50 6.50%, 6/15/23, Pool #358250....... 50
51 6.50%, 6/15/23, Pool #349788....... 51
75 6.50%, 6/15/23, Pool #346624....... 76
491 7.00%, 7/15/23, Pool #360697....... 501
405 7.00%, 7/15/23, Pool #360889....... 414
410 7.00%, 7/15/23, Pool #358382....... 418
787 7.00%, 7/15/23, Pool #346673....... 804
230 7.00%, 7/15/23, Pool #325977....... 235
23 7.00%, 7/15/23, Pool #350709....... 23
173 7.00%, 7/15/23, Pool #357782....... 176
794 7.00%, 7/15/23, Pool #362982....... 811
313 7.00%, 7/15/23, Pool #353569....... 320
28 7.00%, 7/15/23, Pool #354538....... 28
265 6.50%, 7/15/23, Pool #322200....... 266
272 6.50%, 8/15/23, Pool #360738....... 274
144 6.50%, 8/15/23, Pool #360713....... 145
159 6.50%, 8/15/23, Pool #359027....... 160
383 6.50%, 8/15/23, Pool #353137....... 385
544 6.50%, 8/15/23, Pool #356717....... 547
308 6.50%, 8/15/23, Pool #344505....... 309
687 6.50%, 9/15/23, Pool #345375....... 691
49 6.50%, 9/15/23, Pool #339041....... 50
3,278 8.00%, 10/15/23, Pool #354681...... 3,414
206 6.50%, 10/15/23, Pool #345391...... 207
420 6.00%, 10/15/23, Pool #364717...... 413
33 6.00%, 10/15/23, Pool #370006...... 33
388 6.00%, 10/15/23, Pool #345389...... 382
571 6.50%, 11/15/23, Pool #369356...... 574
18 6.50%, 11/15/23, Pool #370927...... 18
569 6.50%, 12/15/23, Pool #369830...... 572
Continued
26
402
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Government Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Government National Mortgage Assoc., continued:
$ 134 6.50%, 12/15/23, Pool #349944...... $ 135
32 6.50%, 12/15/23, Pool #370289...... 32
925 6.50%, 12/15/23, Pool #349265...... 930
97 6.50%, 12/15/23, Pool #365740...... 98
556 6.50%, 1/15/24, Pool #379127....... 559
19,918 6.50%, 2/15/24, Pool #354747....... 20,025
341 6.50%, 2/15/24, Pool #389200....... 343
1,165 6.50%, 2/15/24, Pool #362341....... 1,172
271 6.50%, 2/15/24, Pool #370338....... 272
161 6.50%, 2/15/24, Pool #380818....... 162
343 6.50%, 2/15/24, Pool #371999....... 345
933 7.00%, 2/16/24, Series 1996-21,
CMO.............................. 950
371 7.50%, 6/15/24, Pool #388747....... 383
79 7.50%, 6/15/24, Pool #389827....... 81
296 8.00%, 9/15/24, Pool #393908....... 308
2,990 8.00%, 9/15/24, Pool #403212....... 3,113
7,293 9.00%, 11/15/24, Pool #780029...... 7,924
924 7.25%, 12/15/25, Pool #411361...... 948
3,947 7.50%, 3/15/26, Pool #422308....... 4,072
7,845 8.00%, 7/15/26, Pool #412644....... 8,149
10,963 8.00%, 12/20/26, Pool #2344........ 11,329
14,500 6.50%, 6/20/27, Series 1997-19
PJ............................... 14,561
9,209 6.00%, 7/20/27, Pool #80094........ 9,381
15,000 6.25%, 8/20/27, Series 98-1 PD..... 14,939
14,592 8.00%, 10/15/27, Pool# 412336...... 15,130
9,900 7.00%, 12/15/27, Pool # 449494..... 10,065
9,664 7.50%, 1/15/28, Pool #461625....... 9,936
9,905 7.00%, 1/15/28, Pool #462495....... 10,066
14,794 7.50%, 2/15/28, Pool #462562....... 15,205
9,968 6.50%, 3/15/28, Pool #467705....... 9,947
9,990 7.00%, 6/15/28, Pool #472679....... 10,149
15,000 7.50%, 7/1/28...................... 15,389
--------
235,250
--------
Total U.S. Government Agency Mortgages 659,534
--------
U.S. GOVERNMENT AGENCY SECURITIES (16.9%):
Federal Farm Credit Bank (0.6%):
5,000 6.88%, 5/1/00...................... 5,105
--------
Federal Home Loan Bank (2.5%):
2,000 9.25%, 11/25/98.................... 2,029
2,000 9.30%, 1/25/99..................... 2,041
3,000 8.60%, 6/25/99..................... 3,084
10,000 5.91%, 12/23/02.................... 10,076
5,000 6.27%, 1/14/04 (b)................. 5,000
--------
22,230
--------
Federal Home Loan Mortgage Corp. (0.7%):
2,000 6.44%, 1/28/00..................... 2,023
4,500 7.13%, 11/18/02.................... 4,744
--------
6,767
--------
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY SECURITIES, CONTINUED:
Federal National Mortgage Assoc. (6.8%):
$15,000 5.43%, 7/21/98..................... $ 14,955
4,000 8.70%, 6/10/99..................... 4,111
3,000 8.90%, 6/12/00..................... 3,177
3,000 6.20%, 11/12/03.................... 2,994
15,000 7.16%, 5/11/05..................... 16,183
10,000 5.88%, 2/2/06...................... 10,033
10,000 6.70%, 6/19/07..................... 10,593
--------
62,046
--------
Resolution Funding Corp. (3.4%):
25,000 Principal STRIPS, 7/15/20.......... 6,881
50,000 Principal STRIPS, 7/15/20.......... 13,762
25,000 Principal STRIPS, 10/15/20......... 6,781
15,000 Principal STRIPS, 4/15/28.......... 2,692
5,000 Principal STRIPS, 4/15/30 (b)...... 800
--------
30,916
--------
Tennessee Valley Authority (2.9%):
25,000 6.24%, 7/15/45, Putable on 7/15/01
@ 100............................ 25,906
--------
Total U.S. Government Agency Securities 152,970
--------
U.S. TREASURY OBLIGATIONS (11.0%):
U.S. Treasury Bonds (4.7%):
25,000 8.13%, 8/15/19..................... 32,241
10,000 6.13%, 11/15/27 (b)................ 10,721
--------
42,962
--------
U.S. Treasury Notes (4.6%):
1,350 6.75%, 4/30/00..................... 1,379
1,500 6.25%, 5/31/00..................... 1,520
4,500 6.13%, 7/31/00..................... 4,554
2,800 6.25%, 4/30/01..................... 2,853
1,000 7.88%, 8/15/01..................... 1,066
500 6.38%, 8/15/02..................... 515
5,000 5.63%, 12/31/02 (b)................ 5,021
250 6.25%, 2/15/03..................... 257
2,500 6.50%, 8/15/05..................... 2,638
20,700 6.50%, 10/15/06 (b)................ 21,975
--------
41,778
--------
U.S. Treasury STRIPS (1.7%):
5,000 8/15/02 (b)........................ 4,003
50,000 2/15/25 (b)........................ 11,111
--------
15,114
--------
Total U.S. Treasury Obligations 99,854
--------
REPURCHASE AGREEMENTS (0.6%):
5,215 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $5,368
U.S. Treasury Bills, 9/3/98,
market value $5,320)............. 5,215
--------
Total Repurchase Agreements 5,215
--------
Continued
27
403
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Government Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
SHORT-TERM SECURITIES HELD AS COLLATERAL (5.5%):
Repurchase Agreements (5.5%):
$49,499 Paine Webber, 6.15%, 7/1/98
(Collateralized by $49,680
various U.S. Government
Securities, 0.00% - 9.35%,
9/25/98 - 9/18/27, market value
$50,527)......................... $ 49,499
--------
Total Short-Term Securities Held as
Collateral 49,499
--------
Total (Cost $933,275) (a) $967,072
========
- ------------
Percentages indicated are based on net assets of $903,987.
(a) Represents cost for financial reporting and federal income tax purposes and
differs from value by net unrealized appreciation of securities as follows
(amounts in thousands):
Unrealized appreciation..................................... $34,016
Unrealized depreciation..................................... (219)
-------
Net unrealized appreciation................................. $33,797
=======
(b) A portion of this security was loaned as of June 30, 1998.
CMO Collateralized Mortgage Obligation
See notes to financial statements.
28
404
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Income Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
ASSET BACKED SECURITIES (6.4%):
$ 4,927 Advanta Mortgage Loan Trust,
Series 1995-1, Class A5, 8.32%,
12/25/19........................ $ 5,201
5,000 Advanta Mortgage Loan Trust,
Series 1997-2, Class A4, 7.60%,
6/25/27......................... 5,280
4,195 Aircraft Lease Portfolio
Securitization Ltd., Series
1994-1, Class A2, 7.15%,
9/15/04......................... 4,222
1,796 Auto Finance Group, Inc., Series
1997-B, Class C, 7.00%,
2/15/03......................... 1,772
5,000 EQCC Home Loan Trust, Series
1998-2, Class A3F, 6.23%,
3/15/13......................... 5,001
5,000 Greentree Financial Corp., Series
1993-2, Class B, 8.00%,
7/15/18......................... 5,249
5,000 Greentree Financial Corp., Series
1995-10, Class B1, 7.05%,
2/15/27......................... 4,961
4,350 Greentree Financial Corp., Series
1995-2, Class B1, 8.60%,
5/15/26......................... 4,535
5,000 Greentree Home Improvement Loan
Trust, Series 1995-D, Class M1,
6.95%, 9/15/25.................. 5,075
3,000 MBNA, Series 1998-C, 6.35%,
11/15/05........................ 3,000
3,073 Olympic Automobile Receivables
Trust, Series 1994-B, Class A2,
6.85%, 6/15/01.................. 3,132
3,919 Olympic Automobile Receivables
Trust, Series 1995-B, Class A2,
7.35%, 10/15/01................. 3,958
3,000 Team Fleet Financial Corp., Series
1998-2A, Class C, 6.53%,
7/25/02......................... 2,998
5,000 World Omni, Series 1997, Class A7,
6.48%, 12/12/08................. 5,017
----------
Total Asset Backed Securities 59,401
----------
COLLATERALIZED BOND OBLIGATIONS (0.6%):
5,000 Merrill Lynch, 1996 PM1, 7.87%,
12/17/06........................ 5,167
----------
Total Collateralized Bond Obligations 5,167
----------
CORPORATE BONDS (39.3%):
Banking, Finance & Insurance (13.3%):
2,000 American Health Properties, 7.50%,
1/15/07......................... 2,143
9,000 Associates Corp., 8.34%,
11/25/99........................ 9,292
6,000 Associates Corp., 8.15%, 8/1/09... 6,878
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
CORPORATE BONDS, CONTINUED:
Banking, Finance & Insurance, continued:
$ 5,000 BankAmerica Corp., 9.50%,
4/1/01.......................... $ 5,431
5,000 Bear Stearns Co., Inc., 8.25%,
2/1/02.......................... 5,338
5,000 Bradley Operating, 7.20%,
1/15/08......................... 5,038
6,500 Corestates Capital, 8.00%,
12/15/26........................ 7,141
5,000 Cullen Frost Bank Capital Trust,
8.42%, 2/1/27................... 5,638
5,000 First Chicago Capital Trust,
7.95%, 12/1/26.................. 5,500
2,000 Fleet Financial Group, Inc.,
8.13%, 7/1/04................... 2,190
3,500 Ford Capital BV, 10.13%,
11/15/00........................ 3,815
1,500 Ford Motor Credit Corp., 6.38%,
10/6/00......................... 1,515
3,000 General Motors Acceptance Corp.,
8.40%, 10/15/99................. 3,094
8,000 General Motors Acceptance Corp.,
7.00%, 3/1/00................... 8,129
10,000 Lehman Brothers Holdings, Inc.,
8.88%, 3/1/02................... 10,862
5,000 Lehman Brothers Holdings, Inc.,
11.63%, 5/15/05................. 6,450
5,000 Lehman Brothers Holdings, Inc.,
8.80%, 3/1/15................... 5,969
6,000 Massachusetts Mutual Life
Insurance, 7.50%, 3/1/24,
144A............................ 6,563
5,000 MIC Financial Trust, 8.38%,
2/1/27.......................... 5,525
6,000 Morgan Stanley Dean Witter & Co.,
6.13%, 10/1/03.................. 5,993
5,000 Principal Mutual, 7.88%, 3/1/24... 5,381
5,000 Sun Life Capital Trust, 8.53%,
5/29/49......................... 5,706
----------
123,591
----------
Food Products & Services (0.3%):
2,500 RJR Nabisco Corp., 8.75%,
8/15/05......................... 2,666
----------
Industrial Goods & Services (9.7%):
1,500 Advanced Micro Devices, Inc.,
11.00%, 8/1/03 (b).............. 1,594
5,000 Atlas Copco AB, 6.50%, 4/1/08..... 5,025
5,000 Avon Products Inc., Series 144A,
6.25%, 5/1/03................... 5,038
3,000 Boise Cascade Co., 9.45%,
11/1/09......................... 3,630
4,000 Comcast Cable, 8.38%, 5/1/07,
144A............................ 4,490
1,500 Comcast Cellular Holdings, 9.50%,
5/1/07.......................... 1,569
1,500 D.R. Horton, Inc., 8.38%,
6/15/04......................... 1,511
2,500 Fred Meyer, Inc., 7.38%, 3/1/05... 2,519
2,000 Freeport McMoran, Copper & Gold,
7.50%, 11/15/06................. 1,628
5,000 General Motors Corp., 9.13%,
7/15/01......................... 5,424
3,000 Golden State Petroleum, 8.04%,
2/1/19, 144A.................... 3,191
Continued
29
405
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Income Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
CORPORATE BONDS, CONTINUED:
Industrial Goods & Services, continued:
$ 5,000 Hilton Hotels Corp., 7.95%,
4/15/07......................... $ 5,231
2,500 Loewen Group, Inc., 8.25%,
4/15/03, Callable 4/15/00 @
104.13.......................... 2,591
2,500 Mississippi Chemical Corp., 7.25%,
11/15/17........................ 2,538
4,640 Newmont Gold Co., 8.91%, 1/5/09... 5,185
1,500 Nine West Group, Inc., 8.38%,
8/15/05......................... 1,474
2,500 Northrop-Grumman Corp., 7.00%,
3/1/06.......................... 2,594
4,604 Oslo Seismic Service, 8.28%,
6/1/11, 144A.................... 5,027
2,500 Owens-Illinois, Inc., 7.15%,
5/15/05......................... 2,528
9,000 Penske Truck Leasing, 8.25%,
11/1/99......................... 9,269
1,500 Pride Petroleum Services, Inc.,
9.38%, 5/1/07................... 1,584
5,000 Tele-Commun, Inc., 7.38%,
2/15/00......................... 5,100
1,500 Tenet Healthcare Corp., 8.00%,
1/15/05......................... 1,560
1,500 Terra Industries, 10.50%, 6/15/05,
Callable 6/15/00 @ 105.25 (b)... 1,622
1,500 Trico Marine Services, Inc.,
8.50%, 8/1/05................... 1,470
5,000 U.S. Filter Corp., 6.38%,
5/15/01......................... 5,006
2,000 Wyman-Gordon Co., 8.00%,
12/15/07........................ 2,050
----------
90,448
----------
Real Estate (5.9%):
2,000 Avalon Properties, Inc., 7.38%,
9/15/02......................... 2,070
1,500 Dynex Capital, Inc., 7.88%,
7/15/02......................... 1,524
4,750 Meditrust, Inc., 7.77%, 8/16/02... 4,952
3,000 Meditrust, Inc., 7.82%, 9/10/26... 3,431
3,500 MEPC Finance, Inc., 7.50%,
5/1/03.......................... 3,745
5,000 Security Capital Pacific Trust,
6.95%, 10/15/02................. 5,113
2,500 Security Capital Pacific Trust,
7.15%, 10/15/03................. 2,566
5,000 Security Pacific Corp., 11.00%,
3/1/01.......................... 5,600
5,000 Spieker Properties, Inc., 6.65%,
12/15/00........................ 5,044
4,000 Spieker Properties, Inc., 8.00%,
7/19/05......................... 4,300
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
CORPORATE BONDS, CONTINUED:
Real Estate, continued:
$ 8,000 Taubman Realty Group, 7.00%,
10/1/03......................... $ 8,109
3,000 Wellsford Residential Property,
7.25%, 8/15/00.................. 3,064
5,000 Western Banktrust REIT, 7.88%,
2/15/04......................... 5,300
----------
54,818
----------
Transportation & Shipping (1.3%):
5,000 Enterprise Rental-A-Car, 6.38%,
5/15/03......................... 5,000
5,000 Union Pacific Co., 9.63%,
12/15/02........................ 5,638
1,500 Viking Star Shipping, 9.63%,
7/15/03......................... 1,571
----------
12,209
----------
Utilities (1.1%):
7,000 NRG Energy Corp., 7.63%, 2/1/06... 7,411
2,819 Salton Sea Funding Corp., 6.69%,
5/30/00......................... 2,847
----------
10,258
----------
Yankee & Eurodollar (7.7%):
5,000 BCH Cayman Islands, 8.25%,
6/15/04 (b)..................... 5,456
4,000 BCH Cayman Islands, 7.50%,
6/15/05......................... 4,240
5,000 Celulosa Arauco, 6.75%,
12/15/03........................ 4,869
12,302 Centra Gas, 10.65%, 12/1/10,
144A............................ 12,702
5,000 China International Trust &
Investing, 9.00%, 10/15/06
(b)............................. 5,056
5,000 China Light & Power Ltd., 7.50%,
4/15/06......................... 4,906
5,000 Coca-Cola Femsa, 8.95%, 11/1/06... 5,056
2,000 Kansalis-Osake Pankki, 9.75%,
12/15/98........................ 2,030
2,000 Petroleos Mexicanos, 8.85%,
9/15/07......................... 1,973
2,500 Petroliam Nasional Berhad, 7.13%,
10/18/06 (b).................... 2,122
4,250 Ras Laffan Gas, 7.63%, 9/15/06,
144A............................ 4,117
5,000 Scotland International Finance,
8.80%, 1/27/04, 144A............ 5,588
4,000 Scotland International Finance,
8.85%, 11/1/06, 144A............ 4,630
Continued
30
406
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Income Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
CORPORATE BONDS, CONTINUED:
Yankee & Eurodollar, continued:
$ 4,000 Termoemcali Funding Corp., 10.13%,
12/15/14, 144A.................. $ 3,770
2,400 Yanacocha, 8.40%, 6/15/04......... 2,381
2,426 Ypf Sociedad Anomima, 7.00%,
10/26/02........................ 2,435
----------
71,331
----------
Total Corporate Bonds 365,321
----------
EQUIPMENT TRUST CERTIFICATES (2.6%):
4,886 Federal Express, Series A-1,
7.85%,
1/30/15......................... 5,313
10,966 Northwest Air Trust, Series 2,
Class A, 9.25%, 12/21/12........ 13,064
4,569 Northwest Air Trust, Series B,
10.23%, 12/21/12................ 5,523
----------
Total Equipment Trust Certificates 23,900
----------
OTHER MORTGAGED BACKED SECURITIES (1.1%):
2,485 BHN, Series 1997-1, Class A2,
7.92%, 7/25/09.................. 2,462
2,750 BHN, Series 1997-2, Class A2,
7.54%, 5/31/17.................. 2,742
5,000 Residential Funding Corp., Series
1996-HS2, Class A4, 7.55%,
9/25/12......................... 5,210
----------
Total Other Mortgaged Backed Securities 10,414
----------
U.S. GOVERNMENT AGENCY MORTGAGES (23.8%):
Federal Home Loan Mortgage Corp. (13.1%):
5,000 7.13%, 7/21/99.................... 5,074
18,000 0.00%, 8/15/02 (b)................ 14,277
3,684 7.00%, 6/1/09, Pool #E00313....... 3,765
6,722 7.50%, 5/1/11, Pool #E00438....... 6,934
6,853 7.00%, 5/1/11, Pool #E00434....... 7,003
6,423 7.00%, 6/1/11, Pool #E64220....... 6,563
19,794 6.50%, 4/1/13, Gold Pool
#E69986......................... 19,931
9,969 6.50%, 5/1/13, Gold Pool
#E70312......................... 10,037
9,967 6.50%, 5/1/13, Pool #E70383....... 10,036
9,506 6.50%, 1/1/24, Gold Pool
#C80091......................... 9,518
965 7.50%, 6/1/24, Pool #C80161....... 993
13,594 7.00%, 9/1/24, Pool #G00271....... 13,849
5,472 7.50%, 10/1/24, Pool #C80245...... 5,627
8,284 7.00%, 11/1/24, Pool #G00278...... 8,439
----------
122,046
----------
Federal National Mortgage Assoc. (7.5%):
6,494 7.00%, 4/1/03, Pool #303865....... 6,585
15,747 8.00%, 12/1/09, Pool #250168...... 16,294
9,903 6.50%, 5/1/13, Pool #251700....... 9,961
15,000 6.00%, 6/1/13, Pool #423196....... 14,841
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
U.S. GOVERNMENT AGENCY MORTGAGES, CONTINUED:
Federal National Mortgage Assoc., continued:
$ 2,000 8.20%, 3/10/16 (b)................ $ 2,488
8,871 7.50%, 9/1/25, Pool #324179....... 9,137
9,972 6.50%, 4/1/28, Pool #420165....... 9,931
----------
69,237
----------
Government National Mortgage Assoc. (3.2%):
2,552 9.00%, 11/15/24, Pool #780029..... 2,773
7,780 7.50%, 7/15/26, Pool #430999...... 8,018
8,543 7.50%, 7/20/27, Pool #2457........ 8,751
9,860 6.50%, 2/15/28, Pool #460759...... 9,839
----------
29,381
----------
Total U.S. Government Agency Mortgages 220,664
----------
U.S. GOVERNMENT AGENCY SECURITIES (0.6%):
Government Trust Certificate (0.2%):
1,768 Israel, 9.40%, 5/15/02............ 1,830
----------
Tennessee Valley Authority (0.4%):
3,200 8.63%, 11/15/29................... 3,536
----------
Total U.S. Government Agency Securities 5,366
----------
U.S. TREASURY OBLIGATIONS (24.1%):
U.S. Treasury Bonds (8.5%):
2,250 13.38%, 8/15/01 (b)............... 2,751
9,600 11.88%, 11/15/03 (b).............. 12,376
14,000 9.00%, 11/15/18................... 19,460
11,250 8.13%, 8/15/21 (b)................ 14,660
7,125 8.00%, 11/15/21 (b)............... 9,182
17,600 7.13%, 2/15/23 (b)................ 20,817
----------
79,246
----------
U.S. Treasury Notes (13.0%):
15,000 6.25%, 8/31/00 (b)................ 15,222
34,800 6.63%, 6/30/01 (b)................ 35,819
15,000 6.25%, 6/30/02 (b)................ 15,377
30,000 6.25%, 2/15/03 (b)................ 30,880
11,500 6.25%, 2/15/07 (b)................ 12,045
10,000 6.63%, 5/15/07 (b)................ 10,737
----------
120,080
----------
U.S. Treasury STRIPS (2.6%):
85,000 10/15/19.......................... 24,496
----------
Total U.S. Treasury Obligations 223,822
----------
REPURCHASE AGREEMENTS (0.3%):
3,102 Prudential Securities, 6.10%,
7/1/98 (Collateralized by $3,193
U.S. Treasury Bills, 9/3/98,
market value $3,165)............ 3,102
----------
Total Repurchase Agreements 3,102
----------
Continued
31
407
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Income Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL (16.0%):
Master Notes (2.6%):
$ 6,835 Bear Stearns Mortgage Capital,
6.77%, 10/9/98*................. $ 6,835
4,557 Danaher Corp., 6.68%, 10/9/98*.... 4,557
6,835 Merrill Lynch Mortgage Capital,
6.75%, 7/23/98*................. 6,835
6,151 NationsBanc Capital Markets,
6.70%, 7/1/98*.................. 6,151
----------
24,378
----------
Put Bonds (1.7%):
6,835 Citicorp, 5.94%, 8/3/98*.......... 6,835
4,557 GMAC, 5.85%, 11/10/99*............ 4,563
4,557 Greenwich Capital, 6.11%,
12/13/99*....................... 4,557
----------
15,955
----------
Repurchase Agreements (11.7%):
25,061 Donaldson, Lufkin & Jenrette,
6.65%, 7/1/98 (Collateralized by
$25,622 various Corporate and
Government Securities,
2.85% - 17.25%,
10/15/02 - 4/15/35, market value
$26,025)........................ 25,061
22,783 Goldman Sachs, 6.65%, 7/1/98
(Collateralized by $24,283
various Corporate Bonds, 0.00%,
7/7/98 - 9/18/98, market value
$24,195)........................ 22,783
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ---------------------------------- ----------
SHORT-TERM SECURITIES HELD AS COLLATERAL, CONTINUED:
Repurchase Agreements, continued:
$50,121 Lehman Brothers, 6.65%, 7/1/98
(Collateralized by $51,377
various Corporate Bonds,
0.00% - 10.13%,
9/15/99 - 10/17/96, market value
$53,776)........................ $ 50,121
4,694 Lehman Brothers, 6.47%, 7/1/98
(Collateralized by $4,929 Media
One Group Bonds, 0.00%, 10/5/98,
market value $4,929)............ 4,694
5,924 Lehman Brothers, 6.00%, 7/1/98
(Collateralized by $37,083
various Government Securities,
0.00% - 10.00%,
12/1/18 - 5/1/24, market value
$6,098)......................... 5,924
----------
108,583
----------
Total Short-Term Securities Held as
Collateral 148,916
----------
Total (Cost $1,021,032) (a) $1,066,073
==========
- ------------
Percentages indicated are based on net assets of $928,512.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $79. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $46,870
Unrealized depreciation..................................... (1,908)
-------
Net unrealized appreciation................................. $44,962
=======
(b) A portion of this security was loaned as of June 30, 1998.
* The interest rate for this variable rate note, which will change periodically,
is based upon an index of market rates. The rate reflected on the Schedule of
Portfolio Investments is the rate in effect at June 30, 1998.
REIT Real Estate Investment Trust
See notes to financial statements.
32
408
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
Treasury & Agency Fund
- --------------------------------------------------------------------------------
SCHEDULE OF PORTFOLIO INVESTMENTS JUNE 30, 1998
(Amounts in Thousands)
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. GOVERNMENT AGENCY (28.2%):
Federal Farm Credit Bank (9.1%):
$ 7,000 7.16%, 5/15/06..................... $ 7,580
3,100 7.60%, 7/24/06..................... 3,447
2,000 5.93%, 7/6/10...................... 2,017
--------
13,044
--------
Federal Home Loan Bank (4.9%):
5,000 6.66%, 6/3/03...................... 5,006
2,000 6.26%, 11/26/03.................... 1,998
--------
7,004
--------
Other U.S. Agencies (14.2%):
4,000 Student Loan Marketing Association,
7.20%, 11/9/00................... 4,132
6,000 Student Loan Marketing Association,
6.00%, 3/5/01.................... 6,000
10,000 Tennessee Valley Authority, 6.13%,
7/15/03.......................... 10,087
--------
20,219
--------
Total U.S. Government Agency 40,267
--------
SHARES OR
PRINCIPAL MARKET
AMOUNT SECURITY DESCRIPTION VALUE
- --------- ----------------------------------- --------
U.S. TREASURY OBLIGATIONS (68.3%):
U.S. Treasury Inflation Protected Bonds (3.5%):
$ 5,128 3.38%, 1/15/07..................... $ 4,968
--------
U.S. Treasury Notes (64.8%):
27,000 7.75%, 11/30/99.................... 27,809
36,000 6.63%, 6/30/01..................... 37,054
8,500 6.25%, 2/28/02 (b)................. 8,694
13,000 7.88%, 11/15/04 (b)................ 14,602
4,000 6.88%, 5/15/06..................... 4,331
--------
92,490
--------
Total U.S. Treasury Obligations 97,458
--------
INVESTMENT COMPANIES (2.5%):
3,627 The One Group Treasury Only Money
Market Fund...................... 3,627
--------
Total Investment Companies 3,627
--------
SHORT-TERM SECURITIES HELD AS COLLATERAL (12.1%):
Repurchase Agreements (12.1%):
$17,229 Paine Webber, 6.15%, 7/1/98
(Collateralized by $17,292
various U.S. Government
Securities, 0.00% - 9.35%,
9/25/98 - 9/18/27, market value
$17,587)......................... 17,229
--------
Total Short-Term Securities Held as
Collateral 17,229
--------
Total (Cost $155,725) (a) $158,581
========
- ------------
Percentages indicated are based on net assets of $142,769.
(a) Represents cost for financial reporting purposes and differs from cost basis
for federal income tax purposes by the amount of losses recognized for
financial reporting purposes in excess of federal income tax reporting of
approximately $34. Cost for federal income tax purposes differs from value
by net unrealized appreciation of securities as follows (amounts in
thousands):
Unrealized appreciation..................................... $2,894
Unrealized depreciation..................................... (72)
------
Net unrealized appreciation................................. $2,822
======
(b) A portion of this security was loaned as of June 30, 1998.
See notes to financial statements.
33
409
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
ULTRA SHORT- LIMITED VOLATILITY INTERMEDIATE
TERM INCOME BOND BOND
FUND FUND FUND
------------ ------------------ ------------
ASSETS:
Investments, at value....................................... $218,244 $619,416 $762,006
Repurchase agreements, at cost.............................. 3,724 44,829 100,432
-------- -------- --------
Total (cost $221,196; $654,845; $848,429, respectively)..... 221,968 664,245 862,438
Cash........................................................ -- 1 --
Interest receivable......................................... 1,278 6,935 7,536
Receivable from brokers for investments sold................ 401 290 3,001
Receivable for capital shares issued........................ 15 37 311
Prepaid expenses and other assets........................... 1 4 3
-------- -------- --------
TOTAL ASSETS................................................ 223,663 671,512 873,289
-------- -------- --------
LIABILITIES:
Dividends payable........................................... 1,016 2,991 3,821
Payable to brokers for investments purchased................ 5,113 -- --
Payable for capital shares redeemed......................... 6 24 11
Payable for return of collateral received for securities on
loan...................................................... -- 55,051 122,850
Net payable for variation margin on futures contracts....... 15 -- --
Accrued expenses and other payables:
Investment advisory fees.................................. 39 162 209
Administration fees....................................... -- 87 104
12b-1 fees................................................ 10 7 24
Other..................................................... 53 88 111
-------- -------- --------
TOTAL LIABILITIES........................................... 6,252 58,410 127,130
-------- -------- --------
NET ASSETS:
Capital..................................................... 221,218 617,555 736,895
Undistributed (distributions in excess of) net investment
income.................................................... (411) (194) 76
Accumulated undistributed net realized gains (losses) from
investment and futures transactions....................... (4,124) (13,659) (4,821)
Net unrealized appreciation (depreciation) from investments
and futures............................................... 728 9,400 14,009
-------- -------- --------
NET ASSETS.................................................. $217,411 $613,102 $746,159
======== ======== ========
NET ASSETS:
Fiduciary............................................... $188,133 $592,669 $680,800
Class A................................................. 24,747 15,582 44,567
Class B................................................. 4,531 4,851 19,924
Class C................................................. -- -- 868
-------- -------- --------
Total....................................................... $217,411 $613,102 $746,159
======== ======== ========
OUTSTANDING UNITS OF BENEFICIAL INTEREST (SHARES):
Fiduciary............................................... 19,053 56,405 67,296
Class A................................................. 2,507 1,483 4,392
Class B................................................. 462 459 1,969
Class C................................................. -- -- 86
-------- -------- --------
Total....................................................... 22,022 58,347 73,743
======== ======== ========
Net asset value
Fiduciary Offering and redemption price per share......... $ 9.87 $ 10.51 $ 10.12
======== ======== ========
Class A Redemption price per share........................ $ 9.87 $ 10.50 $ 10.15
======== ======== ========
Maximum sales charge.................................... 3.00% 3.00% 4.50%
======== ======== ========
Maximum offering price (100%/(100%--maximum sales
charge) of net asset value adjusted to nearest cent)
per share............................................. $ 10.18 $ 10.82 $ 10.63
======== ======== ========
Class B Offering price per share (a)...................... $ 9.81 $ 10.57 $ 10.12
======== ======== ========
Class C Offering price per share (a)...................... $ -- $ -- $ 10.14
======== ======== ========
- ------------
(a) Redemption price per Class B and Class C shares varies based on length of
time shares are held.
See notes to financial statements.
34
410
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 1998
(Amounts in Thousands, except per share amounts)
GOVERNMENT INCOME TREASURY &
BOND BOND AGENCY
FUND FUND FUND
---------- -------- ----------
ASSETS:
Investments, at value....................................... $912,358 $954,388 $141,352
Repurchase agreements, at cost.............................. 54,714 111,685 17,229
-------- -------- --------
Total (cost $933,275; $1,021,032; $155,725, respectively)... 967,072 1,066,073 158,581
Interest receivable......................................... 6,759 11,508 1,432
Receivable from brokers for investment sold................. -- 5,340 2,165
Receivable for capital shares issued........................ 192 23 579
Deferred organization costs................................. -- -- 2
Prepaid expenses and other assets........................... 5 5 1
-------- -------- --------
TOTAL ASSETS................................................ 974,028 1,082,949 162,760
-------- -------- --------
LIABILITIES:
Dividends payable........................................... 4,401 4,852 679
Payable to brokers for investments purchased................ 15,417 -- 1,999
Payable for capital shares redeemed......................... 6 65 --
Payable for return of collateral received for securities on
loan...................................................... 49,499 148,916 17,229
Accrued expenses and other payables:
Investment advisory fees.................................. 335 305 23
Administration fees....................................... 99 130 8
12b-1 fees................................................ 22 14 14
Other..................................................... 262 155 39
-------- -------- --------
TOTAL LIABILITIES........................................... 70,041 154,437 19,991
-------- -------- --------
NET ASSETS:
Capital..................................................... 884,829 951,477 139,823
Undistributed (distributions in excess of) net investment
income.................................................... (100) 296 --
Accumulated undistributed net realized gains (losses) from
investment and
futures transactions...................................... (14,539) (68,302) 90
Net unrealized appreciation (depreciation) from investments
and futures............................................... 33,797 45,041 2,856
-------- -------- --------
NET ASSETS.................................................. $903,987 $928,512 $142,769
======== ======== ========
NET ASSETS:
Fiduciary............................................... $851,517 $898,263 $ 95,073
Class A................................................. 31,548 14,738 35,213
Class B................................................. 20,922 15,511 12,483
-------- -------- --------
Total....................................................... $903,987 $928,512 $142,769
======== ======== ========
OUTSTANDING UNITS OF BENEFICIAL INTEREST (SHARES):
Fiduciary............................................... 84,263 94,421 9,425
Class A................................................. 3,122 1,550 3,490
Class B................................................. 2,070 1,617 1,238
-------- -------- --------
Total....................................................... 89,455 97,588 14,153
======== ======== ========
Net asset value
Fiduciary Offering and redemption price per share......... $ 10.11 $ 9.51 $ 10.09
======== ======== ========
Class A Redemption price per share........................ $ 10.11 $ 9.51 $ 10.09
======== ======== ========
Maximum sales charge.................................... 4.50% 4.50% 3.00%
======== ======== ========
Maximum offering price (100%/(100%--maximum sales
charge) of net asset value adjusted to nearest cent)
per share............................................. $ 10.59 $ 9.96 $ 10.40
======== ======== ========
Class B Offering price per share (a)...................... $ 10.11 $ 9.59 $ 10.08
======== ======== ========
- ------------
(a) Redemption price per Class B and Class C shares varies based on length of
time shares are held.
See notes to financial statements.
35
411
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
ULTRA SHORT- LIMITED VOLATILITY INTERMEDIATE
TERM INCOME BOND BOND
FUND FUND FUND
------------ ------------------ ------------
INVESTMENT INCOME:
Interest income............................................ $12,689 $38,915 $45,357
Income from securities lending............................. -- 144 287
------- ------- -------
Total Income............................................... 12,689 39,059 45,644
------- ------- -------
EXPENSES:
Investment advisory fees................................... 1,124 3,580 3,951
Administration fees........................................ 335 977 1,078
12b-1 fees (Class A)....................................... 128 63 110
12b-1 fees (Class B)....................................... 34 49 147
12b-1 fees (Class C)....................................... -- -- 3
Custodian and accounting fees.............................. 32 74 96
Legal and audit fees....................................... 10 24 21
Organization costs......................................... 3 -- --
Trustees' fees and expenses................................ 3 11 10
Transfer agent fees........................................ 47 88 78
Registration and filing fees............................... 67 48 157
Printing costs............................................. 10 36 32
Other...................................................... 4 25 10
------- ------- -------
Total expenses before waivers.............................. 1,797 4,975 5,693
Less waivers............................................... (1,079) (1,730) (1,773)
------- ------- -------
Net Expenses............................................... 718 3,245 3,920
------- ------- -------
Net Investment Income...................................... 11,971 35,814 41,724
------- ------- -------
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS AND
FUTURES:
Net realized gains (losses) from investment and futures
transactions............................................. (446) (2,526) 467
Net change in unrealized appreciation (depreciation) from
investments and futures.................................. 200 4,699 11,026
------- ------- -------
Net realized/unrealized gains (losses) from investments and
futures.................................................. (246) 2,173 11,493
------- ------- -------
Change in net assets resulting from operations............. $11,725 $37,987 $53,217
======= ======= =======
See notes to financial statements.
36
412
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 1998
(Amounts in Thousands)
GOVERNMENT INCOME TREASURY &
BOND BOND AGENCY
FUND FUND FUND
---------- ------- -----------
INVESTMENT INCOME:
Interest income............................................. $56,100 $61,807 $7,390
Dividend income............................................. -- -- 159
Income from securities lending.............................. 127 280 13
------- ------- ------
Total Income................................................ 56,227 62,087 7,562
------- ------- ------
EXPENSES:
Investment advisory fees.................................... 3,795 5,074 465
Administration fees......................................... 1,381 1,385 190
12b-1 fees (Class A)........................................ 116 51 38
12b-1 fees (Class B)........................................ 152 138 39
Custodian and accounting fees............................... 125 74 8
Legal and audit fees........................................ 34 27 5
Organization costs.......................................... 2 -- 1
Trustees' fees and expenses................................. 17 13 1
Transfer agent fees......................................... 122 80 25
Registration and filing fees................................ 67 114 55
Printing costs.............................................. 55 62 4
Other....................................................... 38 17 2
------- ------- ------
Total expenses before waivers............................... 5,904 7,035 833
Less waivers................................................ (454) (1,720) (374)
------- ------- ------
Net Expenses................................................ 5,450 5,315 459
------- ------- ------
Net Investment Income....................................... 50,777 56,772 7,103
------- ------- ------
REALIZED/UNREALIZED GAINS (LOSSES) FROM INVESTMENTS AND
FUTURES:
Net realized gains (losses) from investment and futures
transactions.............................................. 6,626 (13,587) 430
Net change in unrealized appreciation (depreciation) from
investments and futures................................... 27,673 21,151 1,288
------- ------- ------
Net realized/unrealized gains (losses) from investments and
futures................................................... 34,299 7,564 1,718
------- ------- ------
Change in net assets resulting from operations.............. $85,076 $64,336 $8,821
======= ======= ======
See notes to financial statements.
37
413
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
ULTRA SHORT-TERM LIMITED VOLATILITY
INCOME FUND BOND FUND
----------------------- -----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
---------- ---------- ---------- ----------
FROM INVESTMENT ACTIVITIES:
OPERATIONS:
Net investment income.................................. $ 11,971 $ 5,647 $ 35,814 $ 36,887
Net realized gains (losses) from investment and futures
transactions........................................ (446) (269) (2,526) (2,851)
Net change in unrealized appreciation (depreciation)
from investments and futures........................ 200 1,032 4,699 5,502
-------- -------- -------- ---------
Change in net assets resulting from operations........... 11,725 6,410 37,987 39,538
-------- -------- -------- ---------
DISTRIBUTIONS TO FIDUCIARY SHAREHOLDERS:
From net investment income............................. (9,591) (4,769) (34,511) (35,406)
From net realized gains from investment transactions... -- -- -- --
DISTRIBUTIONS TO CLASS A SHAREHOLDERS:
From net investment income............................. (2,049) (761) (1,040) (1,219)
From net realized gains from investment transactions... -- -- -- --
DISTRIBUTIONS TO CLASS B SHAREHOLDERS:
From net investment income............................. (177) (94) (263) (262)
From net realized gains from investment transactions... -- -- -- --
DISTRIBUTIONS TO CLASS C SHAREHOLDERS:
From net investment income............................. -- -- -- --
-------- -------- -------- ---------
Change in net assets from shareholder distributions...... (11,817) (5,624) (35,814) (36,887)
-------- -------- -------- ---------
CAPITAL TRANSACTIONS:
Proceeds from shares issued............................ 210,232 109,550 120,557 117,648
Proceeds from shares issued in conversion.............. 1,303 -- 41,843 --
Dividends reinvested................................... 1,953 790 2,149 3,251
Cost of shares redeemed................................ (142,859) (26,641) (142,574) (165,778)
-------- -------- -------- ---------
Change in net assets from share transactions............. 70,629 83,699 21,975 (44,879)
-------- -------- -------- ---------
Change in net assets..................................... 70,537 84,485 24,148 (42,228)
NET ASSETS:
Beginning of period.................................... 146,874 62,389 588,954 631,182
-------- -------- -------- ---------
End of period.......................................... $217,411 $146,874 $613,102 $ 588,954
======== ======== ======== =========
SHARE TRANSACTIONS:
Issued................................................. 21,267 11,129 11,459 11,253
Issued in conversion................................... 132 -- 3,970 --
Reinvested............................................. 198 81 204 311
Redeemed............................................... (14,453) (2,708) (13,545) (15,866)
-------- -------- -------- ---------
Change in shares......................................... 7,144 8,502 2,088 (4,302)
======== ======== ======== =========
- ------------
(a) Period from commencement of operations.
(b) Amount is less than 1,000.
See notes to financial statements.
38
414
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
(Amounts in Thousands)
INTERMEDIATE BOND FUND GOVERNMENT BOND FUND INCOME BOND FUND TREASURY & AGENCY FUND
- ----------------------- ----------------------- ----------------------- -----------------------------
JANUARY 20, 1997
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED TO
JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997 1998 1997 1998 1997 (A)
- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------------
$ 41,724 $ 26,017 $ 50,777 $ 46,994 $ 56,772 $ 44,089 $ 7,103 $ 3,196
467 (935) 6,626 (894) (13,587) (280) 430 178
11,026 3,378 27,673 10,875 21,151 6,049 1,288 (341)
- --------- -------- -------- --------- -------- --------- -------- --------
53,217 28,460 85,076 56,975 64,336 49,858 8,821 3,033
- --------- -------- -------- --------- -------- --------- -------- --------
(38,981) (24,622) (48,072) (44,081) (55,018) (42,737) (6,265) (3,196)
-- -- -- -- -- -- (474) --
(1,927) (940) (1,922) (2,290) (951) (828) (626) --(b)
-- -- -- -- -- -- (32) --
(802) (455) (783) (623) (803) (524) (212) --(b)
-- -- -- -- -- -- (12) --
(14) -- -- -- -- -- -- --
- --------- -------- -------- --------- -------- --------- -------- --------
(41,724) (26,017) (50,777) (46,994) (56,772) (44,089) (7,621) (3,196)
- --------- -------- -------- --------- -------- --------- -------- --------
244,229 187,226 252,076 229,453 296,548 224,558 54,786 6,409
55,814 207,582 26,687 -- -- 132,470 -- 113,243
3,150 1,664 2,675 3,881 2,610 4,757 897 --(b)
(119,865) (98,172) (182,629) (199,344) (134,162) (148,078) (24,372) (9,231)
- --------- -------- -------- --------- -------- --------- -------- --------
183,328 298,300 98,809 33,990 164,996 213,707 31,311 110,421
- --------- -------- -------- --------- -------- --------- -------- --------
194,821 300,743 133,108 43,971 172,560 219,476 32,511 110,258
551,338 250,595 770,879 726,908 755,952 536,476 110,258 --
- --------- -------- -------- --------- -------- --------- -------- --------
$746,159 $551,338 $903,987 $ 770,879 $928,512 $ 755,952 $142,769 $110,258
========= ======== ======== ========= ======== ========= ======== ========
24,230 18,923 25,308 23,794 31,146 23,912 5,441 644
5,521 20,926 2,663 -- -- 14,063 -- 11,324
312 169 268 404 274 508 89 --(b)
(11,889) (9,913) (18,328) (20,680) (14,088) (15,750) (2,418) (927)
- --------- -------- -------- --------- -------- --------- -------- --------
18,174 30,105 9,911 3,518 17,332 22,733 3,112 11,041
========= ======== ======== ========= ======== ========= ======== ========
See notes to financial statements.
39
415
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
STATEMENTS OF CASH FLOWS For the Year Ended June 30, 1998
(Amounts in Thousands)
LIMITED INTERMEDIATE
VOLATILITY BOND INCOME BOND
BOND FUND FUND FUND
---------- ------------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Total investment income.................................. $ 39,059 $ 45,644 $ 62,087
Net expenses............................................. (3,245) (3,920) (5,315)
---------- ----------- -----------
Net investment income (loss).......................... 35,814 41,724 56,772
Adjustments to reconcile net investment income to net cash
provided (used) by operating activities:
(Amortization)/accretion of discount/premium............. (2,611) (1,104) (1,407)
Change in interest and dividends receivable.............. (659) (1,144) (131)
Change in accrued expenses and other payables............ 109 159 168
---------- ----------- -----------
Total adjustments........................................ (3,161) (2,089) (1,370)
---------- ----------- -----------
Net cash provided (used) by operating activities...... 32,653 39,635 55,402
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of short-term investments............ 2,964,519 5,141,279 5,185,917
Proceeds from sales of long-term investments............. 355,314 383,504 252,284
Purchases of short-term investments...................... (3,004,791) (5,193,473) (5,185,936)
Purchases of long-term investments....................... (333,519) (512,683) (416,548)
Purchases of short-term investments with cash received as
collateral from securities lending.................... (55,051) (122,850) (148,916)
Mark to market of futures................................ -- 30 32
---------- ----------- -----------
Net cash provided (used) by investing activities...... (73,528) (304,193) (313,167)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from shares issued.............................. 162,120 299,301 296,540
Cost of shares redeemed.................................. (142,553) (119,859) (134,122)
Distributions paid to shareholders....................... (35,891) (40,884) (56,179)
Dividends reinvested..................................... 2,149 3,150 2,610
Collateral received from securities lending.............. 55,051 122,850 148,916
---------- ----------- -----------
Net cash provided (used) by financing activities...... 40,876 264,558 257,765
Net increase (decrease) in cash............................ 1 -- --
Cash at beginning of period................................ -- -- --
---------- ----------- -----------
Cash at end of period...................................... $ 1 $ -- $ --
========== =========== ===========
See notes to financial statements.
40
416
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS JUNE 30, 1998
1. ORGANIZATION:
The One Group (the "Trust") is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end investment company
established as a Massachusetts business trust. The accompanying financial
statements and financial highlights are those of the Ultra Short-Term Income
Fund, the Limited Volatility Bond Fund, the Intermediate Bond Fund, the
Government Bond Fund, the Income Bond Fund, and the Treasury & Agency Fund
(individually a "Fund," collectively the "Funds") only. Each Fund is a
diversified mutual fund.
The Funds' investment objectives are as follows:
FUND OBJECTIVE
---- ---------
Ultra Short-Term Income Fund A high level of current income consistent with low
volatility of principal by investing in a diversified
portfolio of short-term investment grade securities.
Limited Volatility Bond Fund Current income consistent with the preservation of capital
through investment in high and medium-grade fixed-income
securities.
Intermediate Bond Fund Current income consistent with the preservation of capital
through investments in high and medium-grade fixed-income
securities with intermediate maturities.
Government Bond Fund A high level of current income with liquidity and safety of
principal.
Income Bond Fund A high level of current income by investing primarily in a
diversified portfolio of high, medium and low grade debt
securities.
Treasury & Agency Fund A high level of current income by investing in U.S. Treasury
and other U.S. Agency obligations with a primary, but not
exclusive, focus on issues that produce income exempt from
state income taxes.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Trust in preparation of its financial statements. The policies are in
conformity with generally accepted accounting principles. The preparation of
financial statements requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses for the
period. Actual results could differ from those estimates.
SECURITY VALUATION
Debt securities (other than short-term investments maturing in 60 days or
less), including municipal securities, are valued on the basis of
valuations provided by dealers or by an independent pricing service
approved by the Board of Trustees. Short-term investments maturing in
60 days or less are valued at amortized cost, which approximates market
value. Futures contracts are valued at the settlement price established
each day by the board of trade or an exchange on which they are traded.
Options traded on an exchange are valued using the last sale price or,
in the absence of a sale, the last offering price. Options traded
over-the-counter are valued using dealer-supplied valuations. Invest-
ments for which there are no such quotations or valuations are carried
at fair value as determined by the Fair Value Committee which is
Continued
41
417
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
comprised of members from Banc One Investment Advisors Corporation (the
"Advisor") and The One Group Services Company (the "Administrator")
under the direction of the Board of Trustees.
REPURCHASE AGREEMENTS
The Funds (except for the Treasury & Agency Fund) may invest in
repurchase agreements with institutions that are deemed by the Advisor
to be of good standing and creditworthy under guidelines established
by the Board of Trustees. Each repurchase agreement is recorded at cost.
The Fund requires that the securities purchased in a repurchase
agreement transaction be transferred to the custodian in a manner
sufficient to enable the Fund to obtain those securities in the event of
a counterparty default. The seller, under the repurchase agreement, is
required to maintain the value of the securities held at not less
than the repurchase price, including accrued interest. Repurchase
agreements are considered to be loans by a fund under the 1940 Act.
WRITTEN OPTIONS
The Funds (except for the Limited Volatility Bond Fund and the Treasury
& Agency Fund) may write covered call or secured put options for
which premiums received are recorded as liabilities and are subsequently
adjusted to the current value of the options written. Premiums received
from writing options which expire are treated as realized gains.
Premiums received from writing options, which are either exercised or
closed, are offset against the proceeds received or amount paid on the
transaction to determine realized gains or losses.
FUTURES CONTRACTS
The Funds (except for the Limited Volatility Bond Fund and the Treasury
& Agency Fund) may enter into futures contracts for the delayed
delivery of securities at a fixed price at some future date or for the
change in the value of a specified financial index over a predetermined
time period. Cash or securities are deposited with brokers in order to
maintain a position. Subsequent payments made or received by the Fund
based on the daily change in the market value of the position are
recorded as unrealized appreciation or depreciation until the contract
is closed out, at which time the appreciation or depreciation is
realized.
INDEXED SECURITIES
The Funds (except for the Limited Volatility Bond Fund and the Treasury
& Agency Fund) may invest in indexed securities whose value is
linked either directly or inversely to changes in foreign currencies,
interest rates, commodities, indices or other reference instruments.
Indexed securities may be more volatile than the referenced instrument
itself, but any loss is limited to the amount of the original
investment.
MORTGAGE ROLLS
The Funds (except for the Treasury & Agency Fund) may enter into
mortgage "dollar rolls" in which the Fund sells mortgage-backed
securities for delivery in the current month and simultaneously
contracts to repurchase substantially similar securities on a specified
future date. During the roll period, the Fund forgoes principal and
interest paid on the mortgage-backed securities. The Fund is compensated
by fee income or the difference between the current sales price and the
lower forward price for the future purchase.
Continued
42
418
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
SECURITIES LENDING
To generate additional income, the Funds may lend up to 33% of
securities in which they are invested pursuant to agreements requiring
that the loan be continuously secured by cash, U.S. Government or U.S.
Government Agency securities, shares of an investment trust or mutual
fund, or any combination of cash and such securities as collateral equal
at all times to at least 100% of the market value plus accrued interest
on the securities lent. The Funds continue to earn interest on
securities lent while simultaneously seeking to earn interest on the
investment of collateral. Collateral is marked to market daily to
provide a level of collateral at least equal to the market value of
securities lent. There may be risks of delay in recovery of the
securities or even loss of rights in the collateral should the borrower
of the securities fail financially. However, loans will be made only to
borrowers deemed by the Advisor to be of good standing and creditworthy
under guidelines established by the Board of Trustees and when, in the
judgment of the Advisor, the consideration which can be earned currently
from such securities loans justifies the attendant risks. Loans are
subject to termination by the Funds or the borrower at any time, and
are, therefore, not considered to be illiquid investments. As of June
30, 1998, the following Funds had securities with the following market
values on loan (amounts in thousands):
MARKET VALUE MARKET VALUE MARKET VALUE
OF CASH OF NON-CASH OF LOANED
COLLATERAL COLLATERAL SECURITIES
------------ ------------ ------------
Limited Volatility Bond Fund................ $ 55,051 $85,299 $135,236
Intermediate Bond Fund...................... 122,850 55,018 172,710
Government Bond Fund........................ 49,499 -- 48,395
Income Bond Fund............................ 148,916 58,526 201,185
Treasury & Agency Fund...................... 17,229 -- 16,847
The loaned securities were fully collateralized by cash, U.S. Government
securities, and commercial paper as of June 30, 1998.
SECURITY TRANSACTIONS AND RELATED INCOME
Security transactions are accounted for on a trade date basis. Net
realized gains or losses from sales of securities are determined on the
specific identification cost method. Interest income and expenses are
recognized on the accrual basis. Dividends are recorded on the
ex-dividend date. Interest income, including any discount or premium, is
accrued as earned using the effective interest method.
EXPENSES
Expenses directly attributable to a Fund are charged directly to that
Fund, while the expenses which are attributable to more than one fund of
the Trust are allocated among the respective Funds. Each class of shares
bears its pro-rata portion of expenses attributable to its series, except
that each class separately bears expenses related specifically to that
class, such as distribution fees.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income are declared daily and paid monthly
for the Funds. Net realized capital gains, if any, are distributed at
least annually. Dividends are declared separately for each class. No
class has preferential dividend rights; differences in per share dividend
rates are due to differences in separate class expenses.
Continued
43
419
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
Distributions from net investment income and from net 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 for mortgage-backed securities,
expiring capital loss carryforwards, and deferrals of certain losses.
Permanent book and tax basis differences have been reclassified among the
components of net assets.
ORGANIZATION COSTS
Costs incurred by the Trust in connection with its organization,
including the fees and expenses of registering and qualifying its shares
for distribution have been deferred and are being amortized using the
straight-line method over a period of five years beginning with the
commencement of each Fund's operations. All such costs, which are
attributable to more than one fund of the Trust, have been allocated
among the respective funds pro-rata, based on the relative net assets of
each Fund. In the event that any of the initial shares are redeemed
during such period by any holder thereof, the related fund will be
reimbursed by such holder for any unamortized organization costs in the
proportion as the number of initial shares being redeemed bears to the
number of initial shares outstanding at the time of redemption.
FEDERAL INCOME TAXES
The Trust treats each Fund as a separate entity for Federal income tax
purposes. Each Fund intends to continue to qualify as a regulated
investment company by complying with the provisions available to certain
investment companies as defined in applicable sections of the Internal
Revenue Code, and to make distributions from net investment income and
from net realized capital gains sufficient to relieve it from all, or
substantially all, Federal income taxes.
3. SHARES OF BENEFICIAL INTEREST:
The Trust has an unlimited number of shares of beneficial interest, with no
par value, which may, without shareholder approval, be divided into an
unlimited number of series of such shares and any series may be classified or
reclassified into one or more classes. The Trust is registered to offer forty
series and five classes of shares: Fiduciary Class, Class A, Class B, Class C
and Service Class. Currently, the Trust consists of thirty-three active
funds. The Funds are each authorized to issue Fiduciary Class, Class A, Class
B and Class C Shares. Class A Shares are subject to initial sales charges,
imposed at the time of purchase, in accordance with the Funds' prospectus.
Certain redemptions of Class B and Class C Shares are subject to contingent
deferred sales charges in accordance with the Funds' prospectus. As of June
30, 1998, no shareholders were in Class C of the Funds except for the
Intermediate Bond Fund. Shareholders are entitled to one vote for each full
share held and will vote in the aggregate and not by class or series, except
as otherwise expressly required by law or when the Board of Trustees has
determined that the matter to be voted on affects only the interest of
shareholders of a particular class or series. The following is a summary of
transactions in Fund shares for the fiscal years ending June 30, 1998 and
1997.
Continued
44
420
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
ULTRA SHORT-TERM INCOME FUND LIMITED VOLATILITY BOND FUND
---------------------------- ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
------------ ------------ ------------ ------------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued........................ $ 185,046 $ 77,614 $ 116,789 $ 111,732
Proceeds from shares issued in conversion.......... 1,303 -- 41,843 --
Dividends reinvested............................... 28 148 1,189 2,151
Cost of shares redeemed............................ (112,580) (21,314) (133,214) (157,344)
--------- -------- --------- ---------
Change in net assets from Fiduciary Share
transactions.................................... $ 73,797 $ 56,448 $ 26,607 $ (43,461)
========= ======== ========= =========
CLASS A SHARES:
Proceeds from shares issued........................ $ 22,649 $ 29,729 $ 2,909 $ 5,026
Dividends reinvested............................... 1,798 578 722 870
Cost of shares redeemed............................ (29,331) (4,720) (8,184) (7,282)
--------- -------- --------- ---------
Change in net assets from Class A Share
transactions.................................... $ (4,884) $ 25,587 $ (4,553) $ (1,386)
========= ======== ========= =========
CLASS B SHARES:
Proceeds from shares issued........................ $ 2,537 $ 2,207 $ 859 $ 890
Dividends reinvested............................... 127 64 238 230
Cost of shares redeemed............................ (948) (607) (1,176) (1,152)
--------- -------- --------- ---------
Change in net assets from Class B Share
transactions.................................... $ 1,716 $ 1,664 $ (79) $ (32)
========= ======== ========= =========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued............................................. 18,717 7,886 11,101 10,686
Issued in conversion............................... 132 -- 3,970 --
Reinvested......................................... 3 15 113 206
Redeemed........................................... (11,387) (2,166) (12,655) (15,059)
--------- -------- --------- ---------
Change in Fiduciary Shares......................... 7,465 5,735 2,529 (4,167)
========= ======== ========= =========
CLASS A SHARES:
Issued............................................. 2,292 3,018 276 482
Reinvested......................................... 182 59 69 83
Redeemed........................................... (2,970) (480) (779) (697)
--------- -------- --------- ---------
Change in Class A Shares........................... (496) 2,597 (434) (132)
========= ======== ========= =========
CLASS B SHARES:
Issued............................................. 258 225 82 85
Reinvested......................................... 13 7 22 22
Redeemed........................................... (96) (62) (111) (110)
--------- -------- --------- ---------
Change in Class B Shares........................... 175 170 (7) (3)
========= ======== ========= =========
Continued
45
421
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
INTERMEDIATE BOND FUND GOVERNMENT BOND FUND
--------------------------- ---------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997
------------ ------------ ------------ ------------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued........................... $ 201,043 $172,698 $ 234,966 $ 217,351
Proceeds from shares issued in conversion............. 55,814 207,582 26,687 --
Dividends reinvested.................................. 963 661 720 1,826
Cost of shares redeemed............................... (110,226) (91,579) (167,601) (181,374)
--------- -------- --------- ---------
Change in net assets from Fiduciary Share
transactions....................................... $ 147,594 $289,362 $ 94,772 $ 37,803
========= ======== ========= =========
CLASS A SHARES:
Proceeds from shares issued........................... $ 30,840 $ 9,430 $ 6,410 $ 9,184
Dividends reinvested.................................. 1,554 671 1,363 1,575
Cost of shares redeemed............................... (7,067) (5,173) (12,344) (15,371)
--------- -------- --------- ---------
Change in net assets from Class A Share
transactions....................................... $ 25,327 $ 4,928 $ (4,571) $ (4,612)
========= ======== ========= =========
CLASS B SHARES:
Proceeds from shares issued........................... $ 11,110 $ 5,098 $ 10,700 $ 2,918
Dividends reinvested.................................. 622 332 592 480
Cost of shares redeemed............................... (2,193) (1,420) (2,684) (2,599)
--------- -------- --------- ---------
Change in net assets from Class B Share
transactions....................................... $ 9,539 $ 4,010 $ 8,608 $ 799
========= ======== ========= =========
CLASS C SHARES:
Proceeds from shares issued........................... $ 1,236 $ -- $ -- $ --
Dividends reinvested.................................. 11 -- -- --
Cost of shares redeemed............................... (379) -- -- --
--------- -------- --------- ---------
Change in net assets from Class C Share
transactions....................................... $ 868 $ -- $ -- $ --
========= ======== ========= =========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued................................................ 19,955 17,457 23,598 22,536
Issued in conversion.................................. 5,521 20,926 2,663 --
Reinvested............................................ 95 67 72 190
Redeemed.............................................. (10,935) (9,247) (16,821) (18,817)
--------- -------- --------- ---------
Change in Fiduciary Shares............................ 14,636 29,203 9,512 3,909
========= ======== ========= =========
CLASS A SHARES:
Issued................................................ 3,051 951 640 956
Reinvested............................................ 154 68 137 164
Redeemed.............................................. (699) (522) (1,238) (1,593)
--------- -------- --------- ---------
Change in Class A Shares.............................. 2,506 497 (461) (473)
========= ======== ========= =========
CLASS B SHARES:
Issued................................................ 1,102 515 1,070 302
Reinvested............................................ 62 34 59 50
Redeemed.............................................. (218) (144) (269) (270)
--------- -------- --------- ---------
Change in Class B Shares.............................. 946 405 860 82
========= ======== ========= =========
CLASS C SHARES:
Issued................................................ 122 -- -- --
Reinvested............................................ 1 -- -- --
Redeemed.............................................. (37) -- -- --
--------- -------- --------- ---------
Change in Class C Shares.............................. 86 -- -- --
========= ======== ========= =========
Continued
46
422
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
(Amounts in Thousands)
INCOME BOND FUND TREASURY & AGENCY FUND
---------------------------- ------------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED JANUARY 20, 1997 TO
JUNE 30, JUNE 30, JUNE 30, JUNE 30,
1998 1997 1998 1997(A)
------------ ------------ ------------- -------------------
CAPITAL TRANSACTIONS:
FIDUCIARY SHARES:
Proceeds from shares issued.............. $ 282,984 $ 210,985 $ 7,487 $ 6,235
Proceeds from shares issued in
conversion............................ -- 132,470 -- 113,243
Dividends reinvested..................... 1,242 3,766 373 --(b)
Cost of shares redeemed.................. (124,033) (142,285) (23,978) (9,231)
--------- --------- -------- --------
Change in net assets from Fiduciary Share
transactions.......................... $ 160,193 $ 204,936 $(16,118) $110,247
========= ========= ======== ========
CLASS A SHARES:
Proceeds from shares issued.............. $ 6,801 $ 7,637 $ 34,752 $ 94
Dividends reinvested..................... 770 647 417 --(b)
Cost of shares redeemed.................. (7,302) (4,192) (121) --
--------- --------- -------- --------
Change in net assets from Class A Share
transactions.......................... $ 269 $ 4,092 $ 35,048 $ 94
========= ========= ======== ========
CLASS B SHARES:
Proceeds from shares issued.............. $ 6,763 $ 5,936 $ 12,547 $ 80
Dividends reinvested..................... 598 344 107 --(b)
Cost of shares redeemed.................. (2,827) (1,601) (273) --(b)
--------- --------- -------- --------
Change in net assets from Class B Share
transactions.......................... $ 4,534 $ 4,679 $ 12,381 $ 80
========= ========= ======== ========
SHARE TRANSACTIONS:
FIDUCIARY SHARES:
Issued................................... 29,726 22,470 743 627
Issued in conversion..................... -- 14,063 -- 11,324
Reinvested............................... 131 403 37 --(b)
Redeemed................................. (13,025) (15,133) (2,379) (927)
--------- --------- -------- --------
Change in Fiduciary Shares............... 16,832 21,803 (1,599) 11,024
========= ========= ======== ========
CLASS A SHARES:
Issued................................... 715 814 3,452 9
Reinvested............................... 81 69 41 --(b)
Redeemed................................. (768) (448) (12) --
--------- --------- -------- --------
Change in Class A Shares................. 28 435 3,481 9
========= ========= ======== ========
CLASS B SHARES:
Issued................................... 705 628 1,246 8
Reinvested............................... 62 36 11 --(b)
Redeemed................................. (295) (169) (27) --(b)
--------- --------- -------- --------
Change in Class B Shares................. 472 495 1,230 8
========= ========= ======== ========
- ------------
(a) Period from commencement of operations.
(b) Amounts are less than 1,000.
Continued
47
423
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
4. INVESTMENT ADVISORY, ADMINISTRATIVE, AND DISTRIBUTION AGREEMENTS:
The Trust and the Advisor are parties to an investment advisory agreement
under which the Advisor is entitled to receive an annual fee, computed daily
and paid monthly, equal to the following percentages of the Funds' average
net assets: 0.60% of the Income Bond Fund, the Intermediate Bond Fund and the
Limited Volatility Bond Fund; 0.55% of the Ultra Short-Term Income Fund;
0.45% of the Government Bond Fund; and 0.40% of the Treasury & Agency Fund.
The Trust and the Administrator, a wholly-owned subsidiary of The BISYS
Group, Inc., are parties to an administrative agreement under which the
Administrator provides services for a fee that is computed daily and paid
monthly, at an annual rate of 0.20% on the first $1.5 billion of Trust net
assets (excluding the Investor Growth Fund, the Investor Growth & Income
Fund, the Investor Conservative Growth Fund and the Investor Balanced Fund
(the "Investor Funds") and the Treasury Only Money Market Fund and the
Government Money Market Fund (the "Institutional Money Market Funds"); 0.18%
on the next $0.5 billion of Trust net assets (excluding the Investor Funds
and the Institutional Money Market Funds); and 0.16% of Trust net assets
(excluding the Investor Funds and the Institutional Money Market Funds) over
$2 billion. The Advisor also serves as Sub-Administrator to each fund of the
Trust, pursuant to an agreement between the Administrator and the Advisor.
Pursuant to this agreement, the Advisor performs many of the Administrator's
duties, for which the Advisor receives a fee paid by the Administrator.
The Trust and The One Group Services Company (the "Distributor") are parties
to a distribution agreement under which shares of the Funds are sold on a
continuous basis. Class A, Class B, and Class C Shares are subject to a
distribution and shareholder services plan (the "Plans") pursuant to Rule
12b-1 under the 1940 Act. As provided in the Plans, the Trust will pay the
Distributor a fee of 0.35% of the average daily net assets of Class A Shares
of each of the Funds and 1.00% of the average daily net assets of the Class B
and Class C Shares of each of the Funds. Currently, the Distributor has
voluntarily agreed to limit payments under the Plans to 0.25% of average
daily net assets of the Class A Shares of each Fund, 0.75% of average daily
net assets of the Class B Shares of the Ultra Short-Term Income Fund, the
Limited Volatility Bond Fund and the Treasury & Agency Fund, 0.90% of average
daily net assets of the Class B Shares of the Intermediate Bond Fund, the
Government Bond Fund and the Income Bond Fund and 0.90% of the average daily
net assets of the Class C Shares of the Intermediate Bond Fund. Up to 0.25%
of the fees payable under the Plans may be used as compensation for
shareholder services by the Distributor and/or financial institutions and
intermediaries. Fees paid under the Plans may be applied by the Distributor
toward (i) compensation for its services in connection with distribution
assistance or provision of shareholder services; or (ii) payments to
financial institutions and intermediaries such as banks (including affiliates
of the Advisor), brokers, dealers and other institutions, including the
Distributor's affiliates and subsidiaries as compensation for services or
reimbursement of expenses incurred in connection with distribution assistance
or provision of shareholder services. Fiduciary Class Shares of each Fund are
offered without distribution fees. For the year ended June 30, 1998, the
Distributor received $1,877,779 from commissions earned on sales of Class A
Shares and redemptions of Class B and Class C Shares, of which the
Distributor re-allowed $1,866,957 to affiliated broker-dealers of the Funds.
Certain officers of the Trust are affiliated with the Administrator. Such
officers receive no compensation from the Funds for serving in their
respective roles.
Continued
48
424
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
The Advisor, the Administrator and the Distributor voluntarily agreed to
waive a portion of their fees. For the year ended June 30, 1998, fees in the
following amounts were waived (amounts in thousands):
INVESTMENT 12B-1 FEES
ADVISORY WAIVED
FEES ADMINISTRATION -----------------
WAIVED FEES WAIVED CLASS A CLASS B
------ ----------- ------- -------
Ultra Short-Term Income Fund.................... $ 698 $335 $37 $ 9
Limited Volatility Bond Fund.................... 1,700 -- 18 12
Intermediate Bond Fund.......................... 1,726 -- 32 15
Government Bond Fund............................ 80 326 33 15
Income Bond Fund................................ 1,691 -- 15 14
Treasury & Agency Fund.......................... 232 121 11 10
5. SECURITIES TRANSACTIONS:
The cost of security purchases and the proceeds from the sale of securities
(excluding short-term securities and purchased options) during the year ended
June 30, 1998 were as follows (amounts in thousands):
PURCHASES SALES
--------- --------
Ultra Short-Term Income Fund...................... $162,771 $ 79,715
Limited Volatility Bond Fund...................... 333,519 355,314
Intermediate Bond Fund............................ 512,683 383,504
Government Bond Fund.............................. 839,328 761,985
Income Bond Fund.................................. 416,548 252,284
Treasury & Agency Fund............................ 78,500 51,034
6. FINANCIAL INSTRUMENTS:
Investing in financial instruments such as written options, futures,
structured notes and indexed securities involves risks in excess of the
amounts reflected in the Statement of Assets and Liabilities. The face or
contract amounts reflect the extent of the involvement the Funds have in the
particular class of instrument. Risks associated with these instruments
include an imperfect correlation between the movements in the price of the
instruments and the price of the underlying securities and interest rates, an
illiquid secondary market for the instruments or inability of counterparties
to perform under the terms of the contract. The Funds enter into these
contracts primarily as a means to hedge against adverse fluctuations in
securities.
7. CONVERSION OF COMMON TRUST FUNDS:
On December 19, 1997, the net assets of certain common trust funds managed by
the Advisor were exchanged in a tax-free conversion for shares of the
corresponding One Group Funds. The transaction was accounted for by a method
followed for tax purposes in a tax-free business combination. The following
is a summary of shares
Continued
49
425
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
issued, net assets converted, net asset value per share issued and unrealized
appreciation of assets acquired as of the conversion date (amounts in
thousands except per share amounts):
NET ASSET
VALUE
SHARES NET ASSETS PER SHARE UNREALIZED
ISSUED CONVERTED ISSUED APPRECIATION
------ ---------- ---------- ------------
Ultra Short-Term Income Fund..................... 132 $ 1,303 $ 9.89 $ --
Limited Volatility Bond Fund..................... 3,970 41,843 10.54 254
Intermediate Bond Fund........................... 5,521 55,814 10.11 639
Government Bond Fund............................. 2,663 26,687 10.02 127
On January 20, 1997, the net assets of certain common trust funds managed by
the Advisor were exchanged in a tax-free conversion for shares of the
corresponding One Group Funds. The transaction was accounted for by a method
followed for tax purposes in a tax-free business combination. The following is
a summary of shares issued, net assets converted, net asset value per share
issued and unrealized appreciation of assets acquired as of the conversion
date (amounts in thousands except per share amounts):
NET ASSET
VALUE
SHARES NET ASSETS PER SHARE UNREALIZED
ISSUED CONVERTED ISSUED APPRECIATION
------ ---------- ---------- ------------
Income Bond Fund................................. 14,063 $132,470 $ 9.42 $4,511
Intermediate Bond Fund........................... 20,926 207,582 9.92 1,740
Treasury & Agency Fund........................... 11,324 113,243 10.00 1,909
8. FEDERAL TAX INFORMATION (UNAUDITED):
The accompanying table below details distributions from long-term capital
gains for the following funds for the fiscal year ended June 30, 1998
(amounts in thousands):
20% 28%
FUND DISTRIBUTION DISTRIBUTIONS
---- ------------ -------------
Treasury & Agency Fund.................................. $241 $37
Continued
50
426
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS, CONTINUED JUNE 30, 1998
At June 30, 1998 the following funds have capital loss carryforwards which are
available to offset future capital gains, if any (amounts in thousands):
CAPITAL LOSS
CARRYFORWARDS EXPIRES
------------- -------
Ultra Short-Term Income Fund................................ $ 2,283 2003
Ultra Short-Term Income Fund................................ 1,065 2004
Ultra Short-Term Income Fund................................ 682 2005
Ultra Short-Term Income Fund................................ 139 2006
Limited Volatility Bond Fund................................ 197 2000
Limited Volatility Bond Fund................................ 165 2001
Limited Volatility Bond Fund................................ 443 2002
Limited Volatility Bond Fund................................ 2,720 2003
Limited Volatility Bond Fund................................ 3,301 2004
Limited Volatility Bond Fund................................ 651 2005
Limited Volatility Bond Fund................................ 2,646 2006
Intermediate Bond Fund...................................... 47 2000
Intermediate Bond Fund...................................... 845 2001
Intermediate Bond Fund...................................... 1,321 2002
Intermediate Bond Fund...................................... 1,980 2003
Intermediate Bond Fund...................................... 530 2005
Government Bond Fund........................................ 9,225 2003
Government Bond Fund........................................ 5,314 2004
Income Bond Fund............................................ 50,654 2003
Income Bond Fund............................................ 1,963 2004
Income Bond Fund............................................ 2,229 2006
Capital losses incurred after October 31 within the Fund's fiscal year may be
deferred and treated as occurring on the first day of the following fiscal
year. The following deferred losses will be treated as arising on the first
day of the fiscal year ended June 30, 1999 (amounts in thousands):
FUND AMOUNT
---- -------
Limited Volatility Bond Fund................................ $ 3,536
Income Bond Fund............................................ 13,376
9. SUBSEQUENT EVENTS:
On May 21, 1998, the Board of Trustees approved an agreement and plan of
reorganization and liquidation ("the Plan") with the Marquis Family of Funds
(the "Marquis Funds"). Under the Plan, the assets and liabilities of each
Marquis fund were transferred to a comparable One Group fund. Shares of the
comparable One Group fund were distributed to the Marquis shareholders in a
complete liquidation of each Marquis fund. A special Shareholder Meeting to
approve the plan was held on July 30, 1998. In a tax-free exchange on August
10, 1998, net assets of the Marquis funds were exchanged for shares of a
corresponding fund of The One Group as follows (amounts in thousands):
SHARES NET ASSETS
ONE GROUP FUND ISSUED MARQUIS FUND CONVERTED
-------------- ------- --------------------------- -----------
Government Bond................... 14,229 Government Securities Fund $144,002
Income Bond....................... 1,784 Strategic Income Bond Fund 16,989
51
427
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ULTRA SHORT-TERM INCOME FUND
-------------------------------------------------------
FIDUCIARY
-------------------------------------------------------
YEAR ENDED JUNE 30,
-------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- ------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.87 $ 9.79 $ 9.84 $ 9.85 $ 10.03
-------- -------- ------- -------- --------
Investment Activities:
Net investment income..................................... 0.59 0.62 0.62 0.55 0.36
Net realized and unrealized gains (losses) from
investments and futures................................. (0.01) 0.05 (0.07) (0.05) (0.15)
-------- -------- ------- -------- --------
Total from Investment Activities........................ 0.58 0.67 0.55 0.50 0.21
-------- -------- ------- -------- --------
Distributions:
Net investment income..................................... (0.58) (0.59) (0.60) (0.48) (0.37)
In excess of net investment income........................ -- -- -- (0.03) (0.02)
-------- -------- ------- -------- --------
Total Distributions..................................... (0.58) (0.59) (0.60) (0.51) (0.39)
-------- -------- ------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................. $ 9.87 $ 9.87 $ 9.79 $ 9.84 $ 9.85
======== ======== ======= ======== ========
Total Return................................................ 6.00% 7.14% 5.71% 5.14% 2.16%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $188,133 $114,413 $57,276 $ 51,050 $139,593
Ratio of expenses to average net assets................... 0.30% 0.35% 0.45% 0.61% 0.65%
Ratio of net investment income to average net assets...... 5.92% 6.02% 6.20% 5.18% 3.70%
Ratio of expenses to average net assets*.................. 0.81% 0.81% 1.06% 1.01% 0.81%
Ratio of net investment income to average net assets*..... 5.41% 5.56% 5.59% 4.78% 3.54%
Portfolio Turnover (a).................................... 41.15% 70.36% 67.65% 2.91% 242.20%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
52
428
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ULTRA SHORT-TERM INCOME FUND
-------------------------------------------------
CLASS A
-------------------------------------------------
YEAR ENDED JUNE 30,
-------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------ ------ -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.87 $ 9.78 $ 9.83 $ 9.84 $ 10.03
------- ------- ------ ------ -------
Investment Activities:
Net investment income..................................... 0.56 0.58 0.58 0.52 0.36
Net realized and unrealized gains (losses) from
investments and futures................................. (0.01) 0.09 (0.06) (0.06) (0.17)
------- ------- ------ ------ -------
Total from Investment Activities........................ 0.55 0.67 0.52 0.46 0.19
------- ------- ------ ------ -------
Distributions:
Net investment income..................................... (0.55) (0.58) (0.57) (0.46) (0.34)
In excess of net investment income........................ -- -- -- (0.01) (0.04)
------- ------- ------ ------ -------
Total Distributions..................................... (0.55) (0.58) (0.57) (0.47) (0.38)
------- ------- ------ ------ -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 9.87 $ 9.87 $ 9.78 $ 9.83 $ 9.84
======= ======= ====== ====== =======
Total Return (Excludes Sales Charge)........................ 5.75% 7.00% 5.42% 4.84% 1.95%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $24,747 $29,643 $3,969 $4,631 $19,053
Ratio of expenses to average net assets................... 0.54% 0.61% 0.70% 0.86% 0.89%
Ratio of net investment income to average net assets...... 5.66% 5.78% 5.95% 4.88% 3.54%
Ratio of expenses to average net assets*.................. 1.15% 1.17% 1.41% 1.36% 1.14%
Ratio of net investment income to average net assets*..... 5.05% 5.22% 5.24% 4.38% 3.29%
Portfolio Turnover (a).................................... 41.15% 70.36% 67.65% 2.91% 242.20%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
53
429
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
ULTRA SHORT-TERM INCOME FUND
----------------------------------------------------
CLASS B
----------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(A)
------ ------ ------ ------- -----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.81 $ 9.76 $ 9.84 $ 9.86 $ 9.98
------ ------ ------ ------- -------
Investment Activities:
Net investment income..................................... 0.52 0.54 0.52 0.47 0.12
Net realized and unrealized gains (losses) from
investments and futures................................. (0.01) 0.05 (0.07) (0.04) (0.11)
------ ------ ------ ------- -------
Total from Investment Activities........................ 0.51 0.59 0.45 0.43 0.01
------ ------ ------ ------- -------
Distributions:
Net investment income..................................... (0.51) (0.54) (0.53) (0.45) (0.12)
In excess of net investment income........................ -- -- -- -- (0.01)
------ ------ ------ ------- -------
Total Distributions..................................... (0.51) (0.54) (0.53) (0.45) (0.13)
------ ------ ------ ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 9.81 $ 9.81 $ 9.76 $ 9.84 $ 9.86
====== ====== ====== ======= =======
Total Return (Excludes Sales Charge)........................ 5.32% 6.22% 4.63% 4.77% (0.09%)(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $4,531 $2,818 $1,144 $ 160 $ 15
Ratio of expenses to average net assets................... 0.99% 1.07% 1.20% 1.31% 1.41%(c)
Ratio of net investment income to average net assets...... 5.23% 5.18% 5.45% 4.91% 3.49%(c)
Ratio of expenses to average net assets*.................. 1.75% 1.81% 2.06% 1.96% 1.83%(c)
Ratio of net investment income to average net assets*..... 4.47% 4.44% 4.59% 4.26% 3.07%(c)
Portfolio Turnover (d).................................... 41.15% 70.36% 67.65% 2.91% 242.20%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
54
430
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LIMITED VOLATILITY BOND FUND
--------------------------------------------------------
FIDUCIARY
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD...................................... $ 10.47 $ 10.42 $ 10.53 $ 10.33 $ 10.87
-------- -------- -------- -------- --------
Investment Activities:
Net investment income.................................... 0.63 0.63 0.64 0.60 0.54
Net realized and unrealized gains (losses) from
investments and futures................................ 0.04 0.05 (0.11) 0.19 (0.45)
-------- -------- -------- -------- --------
Total from Investment Activities....................... 0.67 0.68 0.53 0.79 0.09
-------- -------- -------- -------- --------
Distributions:
Net investment income.................................... (0.63) (0.63) (0.64) (0.59) (0.55)
In excess of net investment income....................... -- -- -- -- (0.02)
Net realized gains....................................... -- -- -- -- (0.06)
-------- -------- -------- -------- --------
Total Distributions.................................... (0.63) (0.63) (0.64) (0.59) (0.63)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................ $ 10.51 $ 10.47 $ 10.42 $ 10.53 $ 10.33
======== ======== ======== ======== ========
Total Return............................................... 6.59% 6.75% 5.13% 7.96% 0.79%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)........................ $592,669 $563,979 $604,916 $410,746 $447,394
Ratio of expenses to average net assets.................. 0.53% 0.51% 0.51% 0.52% 0.50%
Ratio of net investment income to average net assets..... 6.01% 6.06% 6.06% 5.82% 5.10%
Ratio of expenses to average net assets*................. 0.82% 0.81% 0.82% 0.85% 0.85%
Ratio of net investment income to average
net assets*............................................ 5.72% 5.76% 5.75% 5.49% 4.75%
Portfolio Turnover (a)................................... 56.99% 66.61% 75.20% 76.43% 30.61%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
55
431
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LIMITED VOLATILITY BOND FUND
---------------------------------------------------
CLASS A
---------------------------------------------------
YEAR ENDED JUNE 30,
---------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 10.46 $ 10.41 $ 10.52 $ 10.32 $ 10.87
------- ------- ------- ------- -------
Investment Activities:
Net investment income..................................... 0.61 0.61 0.63 0.56 0.52
Net realized and unrealized gains (losses) from
investments and futures................................. 0.04 0.05 (0.13) 0.21 (0.46)
------- ------- ------- ------- -------
Total from Investment Activities........................ 0.65 0.66 0.50 0.77 0.06
------- ------- ------- ------- -------
Distributions:
Net investment income..................................... (0.61) (0.61) (0.61) (0.56) (0.51)
In excess of net investment income........................ -- -- -- (0.01) (0.04)
Net realized gains........................................ -- -- -- -- (0.06)
------- ------- ------- ------- -------
Total Distributions..................................... (0.61) (0.61) (0.61) (0.57) (0.61)
------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.50 $ 10.46 $ 10.41 $ 10.52 $ 10.32
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)........................ 6.32% 6.47% 4.86% 7.67% 0.49%
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $15,582 $20,055 $21,343 $12,516 $15,216
Ratio of expenses to average net assets................... 0.78% 0.76% 0.76% 0.77% 0.75%
Ratio of net investment income to average net assets...... 5.77% 5.81% 5.81% 5.57% 4.92%
Ratio of expenses to average net assets*.................. 1.17% 1.16% 1.17% 1.20% 1.20%
Ratio of net investment income to average
net assets*............................................. 5.38% 5.41% 5.40% 5.14% 4.47%
Portfolio Turnover (a).................................... 56.99% 66.61% 75.20% 76.43% 30.61%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
56
432
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
LIMITED VOLATILITY BOND FUND
---------------------------------------------------
CLASS B
---------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
------------------------------------ JUNE 30,
1998 1997 1996 1995 1994(A)
------ ------ ------ ------ -----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $10.53 $10.49 $10.60 $10.40 $10.78
------ ------ ------ ------ ------
Investment Activities:
Net investment income..................................... 0.58 0.55 0.55 0.53 0.17
Net realized and unrealized gains (losses) from
investments
and futures............................................. 0.04 0.04 (0.10) 0.19 (0.37)
------ ------ ------ ------ ------
Total from Investment Activities........................ 0.62 0.59 0.45 0.72 (0.20)
------ ------ ------ ------ ------
Distributions:
Net investment income..................................... (0.58) (0.55) (0.56) (0.52) (0.15)
In excess of net realized gains........................... -- -- -- -- (0.03)
------ ------ ------ ------ ------
Total Distributions..................................... (0.58) (0.55) (0.56) (0.52) (0.18)
------ ------ ------ ------ ------
NET ASSET VALUE,
END OF PERIOD............................................. $10.57 $10.53 $10.49 $10.60 $10.40
====== ====== ====== ====== ======
Total Return (Excludes Sales Charge)........................ 5.98% 5.74% 4.28% 7.18% (1.81%)(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $4,851 $4,920 $4,923 $2,906 $1,974
Ratio of expenses to average net assets................... 1.11% 1.20% 1.26% 1.28% 1.26%(c)
Ratio of net investment income to average net assets...... 5.44% 5.21% 5.31% 5.10% 4.39%(c)
Ratio of expenses to average net assets*.................. 1.64% 1.81% 1.82% 1.86% 1.86%(c)
Ratio of net investment income to average net assets*..... 4.91% 4.60% 4.75% 4.52% 3.79%(c)
Portfolio Turnover (d).................................... 56.99% 66.61% 75.20% 76.43% 30.61%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
57
433
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERMEDIATE BOND FUND
-------------------------------------------------------
FIDUCIARY
-------------------------------------------------------
YEAR ENDED JUNE 30,
-------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.92 $ 9.84 $ 10.01 $ 9.72 $ 10.51
-------- -------- -------- -------- -------
Investment Activities:
Net investment income..................................... 0.64 0.65 0.66 0.66 0.60
Net realized and unrealized gains (losses) from
investments and futures................................. 0.20 0.08 (0.17) 0.29 (0.67)
-------- -------- -------- -------- -------
Total from Investment Activities........................ 0.84 0.73 0.49 0.95 (0.07)
-------- -------- -------- -------- -------
Distributions:
Net investment income..................................... (0.64) (0.65) (0.66) (0.66) (0.60)
In excess of net investment income........................ -- -- -- -- (0.02)
Net realized gains........................................ -- -- -- -- (0.10)
-------- -------- -------- -------- -------
Total Distributions..................................... (0.64) (0.65) (0.66) (0.66) (0.72)
-------- -------- -------- -------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.12 $ 9.92 $ 9.84 $ 10.01 $ 9.72
======== ======== ======== ======== =======
Total Return................................................ 8.71% 7.68% 4.95% 10.15% (0.74%)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $680,800 $522,423 $230,812 $191,216 $98,483
Ratio of expenses to average net assets................... 0.56% 0.54% 0.54% 0.56% 0.32%
Ratio of net investment income to average net assets...... 6.37% 6.63% 6.56% 6.88% 6.04%
Ratio of expenses to average net assets*.................. 0.83% 0.81% 0.87% 0.99% 0.87%
Ratio of net investment income to average net assets*..... 6.10% 6.36% 6.23% 6.45% 5.49%
Portfolio Turnover (a).................................... 60.08% 55.91% 101.06% 99.71% 85.62%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
58
434
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERMEDIATE BOND FUND
---------------------------------------------
CLASS A
---------------------------------------------
NOVEMBER 30,
YEAR ENDED JUNE 30, 1994 TO
----------------------------- JUNE 30,
1998 1997 1996 1995(A)
------- ------- ------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.95 $ 9.87 $ 10.04 $ 9.45
------- ------- ------- ------
Investment Activities:
Net investment income..................................... 0.62 0.63 0.64 0.37
Net realized and unrealized gains (losses) from
investments and futures................................. 0.20 0.08 (0.17) 0.59
------- ------- ------- ------
Total from Investment Activities........................ 0.82 0.71 0.47 0.96
------- ------- ------- ------
Distributions:
Net investment income..................................... (0.62) (0.63) (0.64) (0.37)
------- ------- ------- ------
Total Distributions..................................... (0.62) (0.63) (0.64) (0.37)
------- ------- ------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.15 $ 9.95 $ 9.87 $10.04
======= ======= ======= ======
Total Return (Excludes Sales Charge)........................ 8.47% 7.40% 4.77% 10.29%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $44,567 $18,763 $13,706 $4,941
Ratio of expenses to average net assets................... 0.81% 0.78% 0.79% 0.83%(c)
Ratio of net investment income to average net assets...... 6.12% 6.35% 6.31% 6.64%(c)
Ratio of expenses to average net assets*.................. 1.18% 1.16% 1.22% 1.66%(c)
Ratio of net investment income to average net assets*..... 5.75% 5.97% 5.88% 5.81%(c)
Portfolio Turnover (d).................................... 60.08% 55.91% 101.06% 99.71%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
59
435
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERMEDIATE BOND FUND
---------------------------------------------
CLASS B
---------------------------------------------
NOVEMBER 30,
YEAR ENDED JUNE 30, 1994 TO
----------------------------- JUNE 30,
1998 1997 1996 1995(A)
------- ------- ------- ------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.92 $ 9.83 $ 10.01 $ 9.45
------- ------- ------- ------
Investment Activities:
Net investment income..................................... 0.55 0.56 0.58 0.23
Net realized and unrealized gains (losses) from
investments and futures................................. 0.20 0.09 (0.18) 0.56
------- ------- ------- ------
Total from Investment Activities........................ 0.75 0.65 0.40 0.79
------- ------- ------- ------
Distributions:
Net investment income..................................... (0.55) (0.56) (0.58) (0.23)
------- ------- ------- ------
Total Distributions..................................... (0.55) (0.56) (0.58) (0.23)
------- ------- ------- ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.12 $ 9.92 $ 9.83 $10.01
======= ======= ======= ======
Total Return (Excludes Sales Charge)........................ 7.78% 6.83% 4.10% 8.22%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $19,924 $10,152 $ 6,077 $ 266
Ratio of expenses to average net assets................... 1.46% 1.44% 1.44% 1.51%(c)
Ratio of net investment income to average net assets...... 5.47% 5.71% 5.66% 6.15%(c)
Ratio of expenses to average net assets*.................. 1.83% 1.81% 1.87% 2.34%(c)
Ratio of net investment income to average net assets*..... 5.10% 5.34% 5.23% 5.31%(c)
Portfolio Turnover (d).................................... 60.08% 55.91% 101.06% 99.71%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
60
436
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INTERMEDIATE BOND FUND
----------------------
CLASS C
----------------------
NOVEMBER 4,
1997 TO
JUNE 30,
1998(A)
----------------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $10.07
------
Investment Activities:
Net investment income..................................... 0.73
Net realized and unrealized gains (losses) from
investments and futures................................. 0.07
------
Total from Investment Activities........................ 0.80
------
Distributions:
Net investment income..................................... (0.73)
------
Total Distributions..................................... (0.73)
------
NET ASSET VALUE,
END OF PERIOD............................................. $10.14
======
Total Return (Excludes Sales Charge)........................ 8.20%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $ 868
Ratio of expenses to average net assets................... 1.46%(c)
Ratio of net investment income to average net assets...... 5.44%(c)
Ratio of expenses to average net assets*.................. 1.82%(c)
Ratio of net investment income to average net assets*..... 5.08%(c)
Portfolio Turnover (d).................................... 60.08%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
61
437
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GOVERNMENT BOND FUND
--------------------------------------------------------
FIDUCIARY
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD...................................... $ 9.69 $ 9.56 $ 9.81 $ 9.35 $ 10.15
-------- -------- -------- -------- --------
Investment Activities:
Net investment income.................................... 0.60 0.62 0.62 0.62 0.51
Net realized and unrealized gains (losses) from
investments and futures................................ 0.42 0.13 (0.25) 0.46 (0.77)
-------- -------- -------- -------- --------
Total from Investment Activities....................... 1.02 0.75 0.37 1.08 (0.26)
-------- -------- -------- -------- --------
Distributions:
Net investment income.................................... (0.60) (0.62) (0.62) (0.61) (0.50)
In excess of net investment income....................... -- -- -- (0.01) (0.02)
In excess of net realized gains.......................... -- -- -- -- (0.02)
-------- -------- -------- -------- --------
Total Distributions.................................... (0.60) (0.62) (0.62) (0.62) (0.54)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................ $ 10.11 $ 9.69 $ 9.56 $ 9.81 $ 9.35
======== ======== ======== ======== ========
Total Return............................................... 10.81% 8.10% 3.81% 12.04% (2.73%)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)........................ $851,517 $724,423 $677,326 $379,826 $209,692
Ratio of expenses to average net assets.................. 0.62% 0.62% 0.68% 0.71% 0.68%
Ratio of net investment income to average net assets..... 6.05% 6.45% 6.34% 6.65% 5.13%
Ratio of expenses to average net assets*................. 0.67% 0.68% 0.69% 0.73% 0.71%
Ratio of net investment income to average net assets*.... 6.00% 6.39% 6.33% 6.63% 5.10%
Portfolio Turnover (a)................................... 91.49% 60.53% 62.70% 106.14% 377.78%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
62
438
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GOVERNMENT BOND FUND
-------------------------------------------------
CLASS A
-------------------------------------------------
YEAR ENDED JUNE 30,
-------------------------------------------------
1998 1997 1995 1994 1994
------- ------- ------- ------ ------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.69 $ 9.56 $ 9.81 $ 9.35 $10.17
------- ------- ------- ------ ------
Investment Activities:
Net investment income..................................... 0.58 0.60 0.60 0.61 0.48
Net realized and unrealized gains (losses) from
investments and futures................................. 0.42 0.13 (0.25) 0.45 (0.79)
------- ------- ------- ------ ------
Total from Investment Activities........................ 1.00 0.73 0.35 1.06 (0.31)
------- ------- ------- ------ ------
Distributions:
Net investment income..................................... (0.58) (0.60) (0.60) (0.59) (0.47)
In excess of net investment income........................ -- -- -- (0.01) (0.02)
In excess of net realized gains........................... -- -- -- -- (0.02)
------- ------- ------- ------ ------
Total Distributions..................................... (0.58) (0.60) (0.60) (0.60) (0.51)
------- ------- ------- ------ ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.11 $ 9.69 $ 9.56 $ 9.81 $ 9.35
======= ======= ======= ====== ======
Total Return (Excludes Sales Charge)........................ 10.54% 7.83% 3.58% 11.84% (3.16%)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $31,548 $34,727 $38,800 $8,130 $1,690
Ratio of expenses to average net assets................... 0.87% 0.87% 0.93% 0.97% 0.92%
Ratio of net investment income to average net assets...... 5.80% 6.20% 6.09% 6.46% 4.84%
Ratio of expenses to average net assets*.................. 1.02% 1.03% 1.04% 1.09% 1.05%
Ratio of net investment income to average net assets*..... 5.65% 6.04% 5.98% 6.34% 4.71%
Portfolio Turnover (a).................................... 91.49% 60.53% 62.70% 106.14% 377.78%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
63
439
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
GOVERNMENT BOND FUND
------------------------------------------------------
CLASS B
------------------------------------------------------
JANUARY 14,
YEAR ENDED JUNE 30, 1994 TO
--------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(A)
------- ------- ------- ------ -----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.69 $ 9.56 $ 9.81 $ 9.35 $10.04
------- ------- ------- ------ ------
Investment Activities:
Net investment income..................................... 0.52 0.54 0.54 0.55 0.18
Net realized and unrealized gains (losses) from
investments and futures................................. 0.42 0.13 (0.25) 0.46 (0.69)
------- ------- ------- ------ ------
Total from Investment Activities........................ 0.94 0.67 0.29 1.01 (0.51)
------- ------- ------- ------ ------
Distributions:
Net investment income..................................... (0.52) (0.54) (0.54) (0.55) (0.16)
In excess of net investment income........................ -- -- -- -- (0.02)
------- ------- ------- ------ ------
Total Distributions..................................... (0.52) (0.54) (0.54) (0.55) (0.18)
------- ------- ------- ------ ------
NET ASSET VALUE,
END OF PERIOD............................................. $ 10.11 $ 9.69 $ 9.56 $ 9.81 $ 9.35
======= ======= ======= ====== ======
Total Return (Excludes Sales Charge)........................ 9.86% 7.14% 2.95% 11.20% (4.99%)(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $20,922 $11,729 $10,782 $2,513 $ 656
Ratio of expenses to average net assets................... 1.52% 1.52% 1.58% 1.62% 1.52%(c)
Ratio of net investment income to average net assets...... 5.14% 5.55% 5.44% 5.76% 4.60%(c)
Ratio of expenses to average net assets*.................. 1.67% 1.68% 1.69% 1.74% 1.63%(c)
Ratio of net investment income to average net assets*..... 4.99% 5.39% 5.33% 5.64% 4.49%(c)
Portfolio Turnover (d).................................... 91.49% 60.53% 62.70% 106.14% 377.78%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
64
440
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INCOME BOND FUND
--------------------------------------------------------
FIDUCIARY
--------------------------------------------------------
YEAR ENDED JUNE 30,
--------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
NET ASSET VALUE,
BEGINNING OF PERIOD...................................... $ 9.42 $ 9.33 $ 9.54 $ 9.23 $ 10.43
-------- -------- -------- -------- --------
Investment Activities:
Net investment income 0.64 0.64 0.65 0.64 0.54
Net realized and unrealized gains (losses) from
investments and futures................................ 0.09 0.09 (0.21) 0.35 (0.74)
-------- -------- -------- -------- --------
Total from Investment Activities....................... 0.73 0.73 0.44 0.99 (0.20)
-------- -------- -------- -------- --------
Distributions:
Net investment income.................................... (0.64) (0.64) (0.65) (0.64) (0.57)
Net realized gains....................................... -- -- -- (0.04) (0.43)
-------- -------- -------- -------- --------
Total Distributions.................................... (0.64) (0.64) (0.65) (0.68) (1.00)
-------- -------- -------- -------- --------
NET ASSET VALUE,
END OF PERIOD............................................ $ 9.51 $ 9.42 $ 9.33 $ 9.54 $ 9.23
======== ======== ======== ======== ========
Total Return............................................... 7.97% 8.10% 4.62% 11.29% (2.54%)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)........................ $898,263 $730,754 $520,239 $474,124 $560,071
Ratio of expenses to average net assets.................. 0.61% 0.60% 0.59% 0.59% 0.53%
Ratio of net investment income to average net assets..... 6.73% 6.85% 6.76% 6.94% 5.35%
Ratio of expenses to average net assets*................. 0.81% 0.80% 0.81% 0.86% 0.85%
Ratio of net investment income to average net assets*.... 6.53% 6.65% 6.54% 6.67% 5.03%
Portfolio Turnover (a)................................... 30.83% 55.18% 95.52% 262.25% 131.04%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
65
441
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INCOME BOND FUND
---------------------------------------------------
CLASS A
---------------------------------------------------
YEAR ENDED JUNE 30,
---------------------------------------------------
1998 1997 1996 1995 1994
------- ------- ------- ------- -------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.41 $ 9.32 $ 9.54 $ 9.22 $ 10.43
------- ------- ------- ------- -------
Investment Activities:
Net investment income..................................... 0.62 0.62 0.63 0.61 0.52
Net realized and unrealized gains (losses) from
investments and futures................................. 0.10 0.09 (0.23) 0.36 (0.75)
------- ------- ------- ------- -------
Total from Investment Activities........................ 0.72 0.71 0.40 0.97 (0.23)
------- ------- ------- ------- -------
Distributions:
Net investment income..................................... (0.62) (0.62) (0.62) (0.60) (0.55)
In excess of net investment income........................ -- -- -- (0.01) --
Net realized gains........................................ -- -- -- (0.04) (0.43)
------- ------- ------- ------- -------
Total Distributions..................................... (0.62) (0.62) (0.62) (0.65) (0.98)
------- ------- ------- ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 9.51 $ 9.41 $ 9.32 $ 9.54 $ 9.22
======= ======= ======= ======= =======
Total Return (Excludes Sales Charge)........................ 7.82% 7.85% 4.26% 10.90% (2.33%)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $14,738 $14,325 $10,127 $ 6,796 $ 5,347
Ratio of expenses to average net assets................... 0.86% 0.85% 0.84% 1.01% 0.78%
Ratio of net investment income to average net assets...... 6.49% 6.59% 6.51% 6.57% 5.25%
Ratio of expenses to average net assets*.................. 1.16% 1.15% 1.16% 1.38% 1.20%
Ratio of net investment income to average net assets*..... 6.19% 6.29% 6.19% 6.20% 4.83%
Portfolio Turnover (a).................................... 30.83% 55.18% 95.52% 262.25% 131.04%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
66
442
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
INCOME BOND FUND
------------------------------------------------------
CLASS B
------------------------------------------------------
JANUARY 17,
YEAR ENDED JUNE 30, 1994 TO
--------------------------------------- JUNE 30,
1998 1997 1996 1995 1994(A)
------- ------- ------ ------- -----------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.49 $ 9.40 $ 9.62 $ 9.29 $ 9.97
------- ------- ------ ------- -------
Investment Activities:
Net investment income..................................... 0.56 0.56 0.56 0.56 0.17
Net realized and unrealized gains (losses) from
investments and futures................................. 0.10 0.09 (0.21) 0.38 (0.70)
------- ------- ------ ------- -------
Total from Investment Activities........................ 0.66 0.65 0.35 0.94 (0.53)
------- ------- ------ ------- -------
Distributions:
Net investment income..................................... (0.56) (0.56) (0.57) (0.57) (0.15)
Net realized gains........................................ -- -- -- (0.04) --
------- ------- ------ ------- -------
Total Distributions..................................... (0.56) (0.56) (0.57) (0.61) (0.15)
------- ------- ------ ------- -------
NET ASSET VALUE,
END OF PERIOD............................................. $ 9.59 $ 9.49 $ 9.40 $ 9.62 $ 9.29
======= ======= ====== ======= =======
Total Return (Excludes Sales Charge)........................ 7.13% 7.15% 3.65% 10.63% (5.29%)(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $15,511 $10,873 $6,110 $ 1,887 $ 723
Ratio of expenses to average net assets................... 1.51% 1.50% 1.49% 1.49% 1.45%(c)
Ratio of net investment income to average net assets...... 5.83% 5.95% 5.86% 6.16% 5.20%(c)
Ratio of expenses to average net assets*.................. 1.81% 1.80% 1.81% 1.86% 1.84%(c)
Ratio of net investment income to average net assets*..... 5.53% 5.65% 5.54% 5.80% 4.81%(c)
Portfolio Turnover (d).................................... 30.83% 55.18% 95.52% 262.25% 131.04%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
67
443
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
TREASURY & AGENCY FUND
----------------------------
FIDUCIARY
----------------------------
YEAR JANUARY 20, 1997
ENDED TO
JUNE 30, JUNE 30,
1998 1997(A)
-------- ----------------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 9.99 $ 10.00
------- --------
Investment Activities:
Net investment income..................................... 0.62 0.28
Net realized and unrealized gains (losses) from
investments and futures................................. 0.15 (0.01)
------- --------
Total from Investment Activities........................ 0.77 0.27
------- --------
Distributions:
Net investment income..................................... (0.62) (0.28)
Net realized gains........................................ (0.05) --
------- --------
Total Distributions..................................... (0.67) (0.28)
------- --------
NET ASSET VALUE, END OF PERIOD.............................. $ 10.09 $ 9.99
======= ========
Total Return................................................ 7.91% 2.78%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $95,073 $110,084
Ratio of expenses to average net assets................... 0.35% 0.45%(c)
Ratio of net investment income to average net assets...... 6.16% 6.44%(c)
Ratio of expenses to average net assets*.................. 0.65% 0.78%(c)
Ratio of net investment income to average net assets*..... 5.86% 6.11%(c)
Portfolio Turnover (d).................................... 41.60% 54.44%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
68
444
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
TREASURY & AGENCY FUND
----------------------------
CLASS A
----------------------------
YEAR JANUARY 20, 1997
ENDED TO
JUNE 30, JUNE 30,
1998 1997(A)
-------- ----------------
NET ASSET VALUE,
BEGINNING OF PERIOD....................................... $ 9.98 $10.00
------- ------
Investment Activities: Net investment income................ 0.63 0.29
Net realized and unrealized gains (losses) from
investments and futures................................. 0.16 (0.02)
------- ------
Total from Investment Activities........................ 0.79 0.27
------- ------
Distributions:
Net investment income..................................... (0.63) (0.29)
Net realized gains........................................ (0.05) --
------- ------
Total Distributions..................................... (0.68) (0.29)
------- ------
NET ASSET VALUE, END OF PERIOD.............................. $ 10.09 $ 9.98
======= ======
Total Return (Excludes Sales Charge)........................ 8.10% 2.78%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $35,213 $ 94
Ratio of expenses to average net assets................... 0.58% 0.71%(c)
Ratio of net investment income to average net assets...... 5.87% 6.47%(c)
Ratio of expenses to average net assets*.................. 0.98% 1.15%(c)
Ratio of net investment income to average net assets*..... 5.47% 6.03%(c)
Portfolio Turnover (d).................................... 41.60% 54.44%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
69
445
- --------------------------------------------------------------------------------
The One Group Family of Mutual Funds
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
TREASURY & AGENCY FUND
----------------------------
CLASS B
----------------------------
YEAR JANUARY 20, 1997
ENDED TO
JUNE 30, JUNE 30,
1998 1997(A)
-------- ----------------
NET ASSET VALUE, BEGINNING OF PERIOD........................ $ 9.99 $10.00
------- ------
Investment Activities:
Net investment income..................................... 0.58 0.26
Net realized and unrealized gains (losses) from
investments and futures................................. 0.14 (0.01)
------- ------
Total from Investment Activities........................ 0.72 0.25
------- ------
Distributions:
Net investment income..................................... (0.58) (0.26)
Net realized gains........................................ (0.05) --
------- ------
Total Distributions..................................... (0.63) (0.26)
------- ------
NET ASSET VALUE, END OF PERIOD.............................. $ 10.08 $ 9.99
======= ======
Total Return (Excludes Sales Charge)........................ 7.33% 2.58%(b)
RATIOS/SUPPLEMENTARY DATA:
Net Assets at end of period (000)......................... $12,483 $ 80
Ratio of expenses to average net assets................... 1.08% 1.23%(c)
Ratio of net investment income to average net assets...... 5.39% 6.30%(c)
Ratio of expenses to average net assets*.................. 1.63% 1.81%(c)
Ratio of net investment income to average net assets*..... 4.84% 5.72%(c)
Portfolio Turnover (d).................................... 41.60% 54.44%
- ------------
* During the period certain fees were voluntarily reduced. If such voluntary
fee reductions had not occurred, the ratios would have been as indicated.
(a) Period from commencement of operations.
(b) Not annualized.
(c) Annualized.
(d) Portfolio turnover is calculated on the basis of the Fund as a whole without
distinguishing among the classes of shares issued.
See notes to financial statements.
70
446
- --------------------------------------------------------------------------------
Report of Independent Accountants
- --------------------------------------------------------------------------------
THE ONE GROUP FAMILY OF MUTUAL FUNDS JUNE 30, 1998
To the Shareholders and Board of Trustees of
The One Group Family of Mutual Funds:
In our opinion, the accompanying statements of assets and liabilities, including
the portfolios of investments, and related statements of operations, of changes
in net assets and of cash flows and the financial highlights present fairly, in
all material respects, the financial position of the Ultra Short-Term Income
Fund, the Limited Volatility Bond Fund, the Intermediate Bond Fund, the
Government Bond Fund, the Income Bond Fund, and the Treasury & Agency Fund (six
series of The One Group Family of Mutual Funds), at June 30, 1998, the results
of each of their operations for the period then ended, the changes in each of
their net assets, and the cash flows of the Limited Volatility Bond Fund, the
Intermediate Bond Fund and the Income Bond Fund for the periods presented and
the financial highlights for each of the periods presented, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of The One Group Family of Mutual Funds' management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at June
30, 1998 by correspondence with the custodian and brokers, provide a reasonable
basis for the opinion expressed above.
PricewaterhouseCoopers LLP
August 18, 1998
71
447
Important Customer Information.
Please Read:
Shares of The One Group:
- - are not deposits or obligations
of, or guaranteed by BANC ONE
CORPORATION or its affiliates
- - are not insured or guaranteed by the
FDIC or by any other governmental
agency or government-sponsored
agency of the federal government
or any state
- - are subject to investment risks,
including possible loss of the
principal amount invested.
Banc One Investment Advisors
Corporation, a registered investment
advisor and an indirect subsidiary of
BANC ONE CORPORATION, serves
as an investment advisor to The One
Group, for which it receives advisory
fees. The One Group is distributed by
The One Group Services Company,
3435 Stelzer Road, Columbus,
Ohio 43219, which is not affiliated
with BANC ONE CORPORATION and
is not a bank. Contact us at our web
site address: www.onegroup.com or
e-mail us at onegroup@onegroup.com
For more complete information on
any of The One Group Funds, includ-
ing management fees and expenses,
you may obtain a prospectus from
The One Group Services Company.
Read the prospectus carefully
before investing.
BANC ONE
INVESTMENT
ADVISORS
CORPORATION
[BANC ONE LOGO]