UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-04801
---------------------------------------------
SunAmerica Equity Funds
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Harborside Financial Center, 3200 Plaza 5 Jersey City, NJ 07311
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Robert M. Zakem, Esq.
Senior Vice President & General Counsel
AIG SunAmerica Asset Management Corp.
Harborside Financial Center,
3200 Plaza 5
Jersey City, NJ 07311
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (201) 324-6363
-----------------------------
Date of fiscal year end: September 30
--------------------------
Date of reporting period: March 31, 2004
-------------------------
Item 1. Reports to Shareholders
SunAmerica Equity Funds, Semiannual Report at March 31, 2004.
[GRAPHIC]
SunAmerica
THE RETIREMENT SPECIALIST
Equity Funds
2004 SEMIANNUAL REPORT
[LOGO]
AIG Sun America
Mutual Funds
March 31, 2004 SEMIANNUAL REPORT
SUNAMERICA EQUITY FUNDS
SunAmerica Blue Chip Growth Fund (SVLAX)
SunAmerica Growth Opportunities Fund (SGWAX)
SunAmerica New Century Fund (SEGAX)
SunAmerica Growth and Income Fund (SEIAX)
SunAmerica Balanced Assets Fund (SBAAX)
SunAmerica International Equity Fund (SIEAX)
SunAmerica Value Fund (SSVAX)
SunAmerica Biotech/Health Fund (SBHAX)
Tax Managed Equity Fund (TXMAX)
Table of Contents
SHAREHOLDER LETTER.......................................................... 2
STATEMENT OF ASSETS AND LIABILITIES......................................... 4
STATEMENT OF OPERATIONS..................................................... 8
STATEMENT OF CHANGES IN NET ASSETS.......................................... 11
FINANCIAL HIGHLIGHTS........................................................ 16
PORTFOLIO OF INVESTMENTS.................................................... 25
NOTES TO FINANCIAL STATEMENTS............................................... 47
TRUSTEE INFORMATION......................................................... 68
SPECIAL MEETING OF SHAREHOLDERS............................................. 70
Shareholder Letter
Dear Shareholders:
We are pleased to present you with this semiannual performance summary of the
SunAmerica Equity Funds. This period, which ended March 31, 2004, provided us
with further evidence that the economy is indeed on the path to recovery.
Please join us in an overview of the conditions that have shaped the domestic
and international equities markets of the past six months.
Domestic Market and Economic Review
In the fourth calendar quarter of 2003, although trending slightly upward, the
equities markets were mainly occupied with digesting the big gains they had
made earlier in the year. After three years of being dramatically oversold,
equity prices rose sharply in 2003, with small and mid-cap stocks performing
especially well. Economic improvements were the catalyst for this shift in the
market's direction, with favorable conditions continuing throughout 2003.
Interest rates remained at record low levels and monetary and fiscal policy
continued to be highly accommodative. As these forces injected enormous
liquidity into the U.S. economy, investors returned to the equities markets,
stock prices improved and corporate fundamentals continued to strengthen. The
Christmas season of 2003 provided a banner season for retail sales.
Simultaneously, the close of 2003 saw a surge in many technology stocks.
At the outset of 2004, the chief concern among observers was that the recovery
had not generated sufficient jobs growth. As we now know, the disappointing
numbers that almost certainly caused the market to pause are strengthening. The
most important development over the past six months has been the vigorous
corporate earnings growth. 2003's fourth quarter earnings were up approximately
26% on a 10% growth in revenue for S&P 500 companies. Driving this, we believe,
is a new profit cycle in the United States that began last year. Strong
earnings and cash flow also have set the stage for continuing dividend
increases in 2004. In addition, we believe equity valuations in most sectors
have remained reasonable, as earnings have moved upwards. Factors weighing on
the stock market include record high oil prices and high commodity prices in
general, against the backdrop of a weak dollar and terrorism's continuing
threat.
During the six-month period, the economy has grown well. 2003's fourth quarter
GDP came in at 4.1%. 2004's first quarter GDP, although not yet announced, is
also expected to be strong and carries with it positive implications for the
market. Capital investment has been increasing too, signaling a return to more
normal corporate spending patterns.
Growth in the economy will continue to be driven by the profitable corporate
sector. At the same time consumers will still benefit from monetary and fiscal
stimulus for at least the first half of 2004. That noted, however, the economy
is now on its own. The Fed and Congress have made strong efforts to provide
accommodative monetary and fiscal policy to spark stimulus throughout the
overall economy, with good results apparent at present. One important question
that remains open is when the Fed will begin raising interest rates again. It
now appears that robust corporate revenue growth and increasingly frequent
signs of economic recovery may prompt the Fed to act soon.
International Market and Economic Review
In tandem with the U.S. expansion, the economic climate in Asia is improving.
Much of the growth has been driven by China, Asia's engine of commerce in
recent years. The region's other emerging markets also have participated in
robust economic activity. In the summer of 2003, Japan unexpectedly began
gaining momentum too, surprising economic experts of that region with the vigor
with which it has begun to revive from a 15-year downturn. Over the semiannual
period, new reports provided further support that Japan is now in the middle of
a normal cyclical expansion. Within the Asian complex, the strengths apparent
in various markets have all reinforced one other; creating an economic
environment that has been stronger than expected for the past year.
In the larger continental countries of Europe--Germany, Italy and France--the
news remains disappointing, with these countries still suffering from sluggish
economic conditions. The United Kingdom, on the other hand, has had quite a
strong economy. Additionally,
2
some of the smaller European countries have benefited from the general economic
improvement going on in the United States and Japan. Out of this economic
overview flows a profit scenario that differs somewhat from what might
initially be expected. In Europe, the profit picture has been more favorable
than the economic picture. That is, a surprising number of companies have been
able to do quite well within the context of lackluster European growth. This
can be explained in part by their international or global character. Also,
perhaps more importantly, companies in Europe have undergone considerable
restructuring and cost cutting, so the bottom line has been growing a lot
faster than the top line. The financial sector, which constitutes a big weight
in European stock markets, has been recovering. These factors, plus the fact
that Asia and North America are supporting each other and buoying emerging
markets, lead us to believe that the recovery is on track.
In view of the beneficial forces now shaping the equities markets both
domestically and abroad, we maintain a positive outlook. As always, thorough
research and judicious stock selection will continue to play a critically
important role in our portfolio management. We encourage you to visit our
website, www.sunamericafunds.com, for current mutual fund information.
Thank you for your continued investment in our Funds.
Sincerely,
The AIG SunAmerica Equity Funds Investment Professionals
Brian Clifford Francis Gannon Chad Palumbo
Heather Doucette Soohwan Kim Timothy Pettee
Jeff Easter Yumi Koh Andrew Sheridan
Gregory Parker James Monaghan Hans Danielsson, AIGGIC
- --------
Past performance is no guarantee of future results
3
SunAmerica Equity Funds
STATEMENT OF ASSETS AND LIABILITIES -- March 31, 2004 -- (unaudited)
Blue Chip Growth New
Growth Opportunities Century
Fund Fund Fund
------------ ------------- -------------
ASSETS:
Investment securities, at value*............................................... $108,516,049 $ 140,018,183 $ 88,053,105
Short-term securities*......................................................... -- -- --
Repurchase agreements (cost equals market)..................................... 2,836,000 1,721,000 13,762,000
Cash........................................................................... 22 449 63
Foreign cash*.................................................................. -- -- --
Due from broker................................................................ -- -- --
Receivables for--
Investments sold............................................................. 2,185,810 1,588,312 --
Shares of beneficial interest sold........................................... 90,887 112,735 25,667
Dividends and interest....................................................... 81,062 34,699 5,419
Prepaid expenses............................................................... 778 480 430
Due from investment advisor.................................................... 822 832 838
------------ ------------- -------------
Total assets................................................................. 113,711,430 143,476,690 101,847,522
------------ ------------- -------------
LIABILITIES:
Payables for--
Investments purchased........................................................ 2,005,985 534,984 --
Shares of beneficial interest redeemed....................................... 257,817 547,620 171,570
Investment advisory and management fees...................................... 71,005 90,221 64,554
Distribution and service maintenance fees.................................... 54,723 70,507 39,072
Transfer agent fees.......................................................... 63,735 84,132 56,673
Line of credit............................................................... -- -- --
Other accrued expenses....................................................... 97,083 119,007 116,365
Unrealized depreciation on forward foreign currency contracts.................. -- -- --
Securities sold short, at value#............................................... -- -- --
Due to custodian............................................................... -- -- --
Due to custodian for foreign cash*............................................. -- -- --
------------ ------------- -------------
Total liabilities............................................................ 2,550,348 1,446,471 448,234
------------ ------------- -------------
Net assets.................................................................. $111,161,082 $ 142,030,219 $ 101,399,288
============ ============= =============
NET ASSETS WERE COMPOSED OF:
Shares of beneficial interest, $.01 par value.................................. $ 79,283 $ 95,634 $ 69,920
Paid-in capital................................................................ 188,254,997 352,088,101 217,589,719
------------ ------------- -------------
188,334,280 352,183,735 217,659,639
Accumulated undistributed net investment income (loss)......................... (469,668) (886,659) (749,039)
Accumulated net realized gain (loss) on investments, futures contracts, options
contracts, securities sold short and foreign exchange transactions............ (85,082,764) (223,354,511) (134,992,639)
Unrealized appreciation (depreciation) on investments.......................... 8,379,234 14,087,654 19,481,327
Unrealized appreciation (depreciation) on securities sold short................ -- -- --
Unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities................................................................... -- -- --
------------ ------------- -------------
$111,161,082 $ 142,030,219 $ 101,399,288
============ ============= =============
*Cost
Investment securities........................................................ $100,136,815 $ 125,930,529 $ 68,571,778
============ ============= =============
Short-term securities........................................................ $ -- $ -- $ --
============ ============= =============
Foreign cash................................................................. $ -- $ -- $ --
============ ============= =============
#Proceeds from securities sold short........................................... $ -- $ -- $ --
============ ============= =============
Growth and Balanced
Income Assets
Fund Fund
------------ ------------
ASSETS:
Investment securities, at value*............................................... $187,351,394 $246,610,302
Short-term securities*......................................................... -- --
Repurchase agreements (cost equals market)..................................... 144,000 --
Cash........................................................................... 168 61,607
Foreign cash*.................................................................. -- --
Due from broker................................................................ -- --
Receivables for--
Investments sold............................................................. 7,613,526 10,854,101
Shares of beneficial interest sold........................................... 78,721 104,700
Dividends and interest....................................................... 183,691 1,065,867
Prepaid expenses............................................................... 2,044 1,101
Due from investment advisor.................................................... 804 782
------------ ------------
Total assets................................................................. 195,374,348 258,698,460
------------ ------------
LIABILITIES:
Payables for--
Investments purchased........................................................ 5,580,731 10,343,709
Shares of beneficial interest redeemed....................................... 256,205 491,934
Investment advisory and management fees...................................... 121,164 157,917
Distribution and service maintenance fees.................................... 119,209 112,696
Transfer agent fees.......................................................... 104,130 123,081
Line of credit............................................................... -- 151,217
Other accrued expenses....................................................... 131,095 225,945
Unrealized depreciation on forward foreign currency contracts.................. -- --
Securities sold short, at value#............................................... -- --
Due to custodian............................................................... -- --
Due to custodian for foreign cash*............................................. -- --
------------ ------------
Total liabilities............................................................ 6,312,534 11,606,499
------------ ------------
Net assets.................................................................. $189,061,814 $247,091,961
============ ============
NET ASSETS WERE COMPOSED OF:
Shares of beneficial interest, $.01 par value.................................. $ 170,919 $ 184,740
Paid-in capital................................................................ 255,545,575 330,655,647
------------ ------------
255,716,494 330,840,387
Accumulated undistributed net investment income (loss)......................... (518,321) (232,085)
Accumulated net realized gain (loss) on investments, futures contracts, options
contracts, securities sold short and foreign exchange transactions............ (82,260,016) (97,379,655)
Unrealized appreciation (depreciation) on investments.......................... 16,123,657 13,863,314
Unrealized appreciation (depreciation) on securities sold short................ -- --
Unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities................................................................... -- --
------------ ------------
$189,061,814 $247,091,961
============ ============
*Cost
Investment securities........................................................ $171,227,737 $232,746,988
============ ============
Short-term securities........................................................ $ -- $ --
============ ============
Foreign cash................................................................. $ -- $ --
============ ============
#Proceeds from securities sold short........................................... $ -- $ --
============ ============
- --------
See Notes to Financial Statements
4
SunAmerica Equity Funds
STATEMENT OF ASSETS AND LIABILITIES -- March 31, 2004 -- (unaudited)
(continued)
Blue Chip Growth New
Growth Opportunities Century
Fund Fund Fund
----------- ------------- -----------
Class A (unlimited shares authorized):
Net assets........................................................................ $68,563,088 $63,739,905 $85,425,743
Shares of beneficial interest issued and outstanding.............................. 4,712,370 4,108,842 5,780,161
Net asset value and redemption price per share.................................... $ 14.55 $ 15.51 $ 14.78
Maximum sales charge (5.75% of offering price).................................... 0.89 0.95 0.90
----------- ----------- -----------
Maximum offering price to public.................................................. $ 15.44 $ 16.46 $ 15.68
=========== =========== ===========
Class B (unlimited shares authorized):
Net assets........................................................................ $31,816,449 $39,767,256 $13,765,026
Shares of beneficial interest issued and outstanding.............................. 2,419,061 2,842,717 1,044.350
Net asset value, offering and redemption price per share (excluding any applicable
contingent deferred sales charge)................................................ $ 13.15 $ 13.99 $ 13.18
=========== =========== ===========
Class C+ (unlimited shares authorized):
Net assets........................................................................ $ 7,566,786 $19,550,897 $ 2,208,519
Shares of beneficial interest issued and outstanding.............................. 576,943 1,399,078 167,495
Net asset value, offering and redemption price per share.......................... $ 13.12 $ 13.97 $ 13.19
=========== =========== ===========
Class I++ (unlimited shares authorized):
Net assets........................................................................ $ 3,214,759 $ 5,108,817 $ --
Shares of beneficial interest issued and outstanding.............................. 219,955 327,436 --
Net asset value, offering and redemption price per share.......................... $ 14.62 $ 15.60 $ --
=========== =========== ===========
Class Z++ (unlimited shares authorized):
Net assets........................................................................ $ -- $ -- $ --
Shares of beneficial interest issued and outstanding.............................. -- -- --
Net asset value, offering and redemption price per share.......................... $ -- $ -- $ --
=========== =========== ===========
Class X (unlimited shares authorized):
Net assets........................................................................ $ -- $13,863,344 $ --
Shares of beneficial interest issued and outstanding.............................. -- 885,371 --
Net asset value, offering and redemption price per share.......................... $ -- $ 15.66 $ --
=========== =========== ===========
Growth and Balanced
Income Assets
Fund Fund
----------- ------------
Class A (unlimited shares authorized):
Net assets........................................................................ $74,641,217 $173,307,347
Shares of beneficial interest issued and outstanding.............................. 6,530,759 12,945,121
Net asset value and redemption price per share.................................... $ 11.43 $ 13.39
Maximum sales charge (5.75% of offering price).................................... 0.70 0.82
----------- ------------
Maximum offering price to public.................................................. $ 12.13 $ 14.21
=========== ============
Class B (unlimited shares authorized):
Net assets........................................................................ $62,807,070 $ 45,181,721
Shares of beneficial interest issued and outstanding.............................. 5,798,105 3,387,907
Net asset value, offering and redemption price per share (excluding any applicable
contingent deferred sales charge)................................................ $ 10.83 $ 13.34
=========== ============
Class C+ (unlimited shares authorized):
Net assets........................................................................ $49,670,065 $ 25,331,864
Shares of beneficial interest issued and outstanding.............................. 4,593,524 1,896,879
Net asset value, offering and redemption price per share.......................... $ 10.81 $ 13.35
=========== ============
Class I++ (unlimited shares authorized):
Net assets........................................................................ $ 1,943,462 $ 3,271,029
Shares of beneficial interest issued and outstanding.............................. 169,529 244,069
Net asset value, offering and redemption price per share.......................... $ 11.46 $ 13.40
=========== ============
Class Z++ (unlimited shares authorized):
Net assets........................................................................ $ -- $ --
Shares of beneficial interest issued and outstanding.............................. -- --
Net asset value, offering and redemption price per share.......................... $ -- $ --
=========== ============
Class X (unlimited shares authorized):
Net assets........................................................................ $ -- $ --
Shares of beneficial interest issued and outstanding.............................. -- --
Net asset value, offering and redemption price per share.......................... $ -- $ --
=========== ============
- --------
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++ See Note 1
See Notes to Financial Statements
5
SunAmerica Equity Funds
STATEMENT OF ASSETS AND LIABILITIES -- March 31, 2004 -- (unaudited)
(continued)
International Biotech/ Tax Managed
Equity Value Health Equity
Fund Fund+ Fund+ Fund+
------------- ------------ ------------ ------------
ASSETS:
Investment securities, at value*........ $ 85,394,168 $189,340,617 $ 45,553,008 $ 58,673,065
Short-term securities*.................. -- -- -- 168,000
Repurchase agreements (cost equals
market)................................ 449,000 1,930,000 6,764,000 --
Cash.................................... 385 -- 919 957
Foreign cash*........................... 464,245 -- -- --
Due from broker......................... -- 884,116 -- --
Receivables for--
Investments sold....................... 2,537,881 1,701,955 8,666,361 1,793,500
Shares of beneficial interest sold..... 36,475 236,333 81,475 63,344
Dividends and interest................. 437,563 409,465 18,673 65,908
Prepaid expenses........................ 445 15,843 8,245 259
Due from investment advisor............. 9,864 1,755 8,016 11,600
------------ ------------ ------------ ------------
Total assets........................... 89,330,026 194,520,084 61,100,697 60,776,633
------------ ------------ ------------ ------------
LIABILITIES:
Payables for--
Investments purchased.................. 2,591,993 1,663,791 5,139,959 1,283,183
Shares of beneficial interest redeemed. 164,365 209,670 131,676 108,327
Investment advisory and management fees 71,957 173,016 33,112 42,957
Distribution and service maintenance
fees................................. 48,697 113,320 32,940 42,231
Transfer agent fees.................... 53,509 64,169 37,726 27,154
Line of credit......................... -- -- -- --
Other accrued expenses................. 151,114 62,635 41,269 52,290
Unrealized depreciation on forward
foreign currency contracts............. -- 156,133 -- --
Securities sold short, at value#........ -- -- 3,969,470 --
Due to custodian........................ -- 890,739 -- --
Due to custodian for foreign cash*...... -- 6 -- --
------------ ------------ ------------ ------------
Total liabilities...................... 3,081,635 3,333,479 9,386,152 1,556,142
------------ ------------ ------------ ------------
Net assets........................... $ 86,248,391 $191,186,605 $ 51,714,545 $ 59,220,491
============ ============ ============ ============
NET ASSETS WERE COMPOSED OF:
Shares of beneficial interest, $.01 par
value.................................. $ 85,139 $ 114,869 $ 49,654 $ 53,837
Paid-in capital......................... 133,238,305 168,771,542 76,913,659 91,316,754
------------ ------------ ------------ ------------
133,323,444 168,886,411 76,963,313 91,370,591
Accumulated undistributed net
investment income (loss)............... (567,197) 859,416 (326,242) (78,248)
Accumulated net realized gain (loss) on
investments, futures contracts,
options contracts, and foreign
exchange transactions.................. (55,417,356) 7,633,689 (33,682,185) (31,541,681)
Unrealized appreciation (depreciation)
on investments......................... 8,886,305 13,963,222 8,893,146 (530,171)
Unrealized appreciation (depreciation)
on securities sold short............... -- -- (133,487) --
Unrealized foreign exchange gain (loss)
on transactions and other assets and
liabilities............................ 23,195 (156,133) -- --
------------ ------------ ------------ ------------
$ 86,248,391 $191,186,605 $ 51,714,545 $ 59,220,491
============ ============ ============ ============
*Cost
Investment securities.................. $ 76,507,863 $175,377,395 $ 36,659,862 $ 59,203,236
============ ============ ============ ============
Short-term securities.................. $ -- $ -- $ -- $ 168,000
============ ============ ============ ============
Foreign cash........................... $ 460,615 $ (6) $ -- $ --
============ ============ ============ ============
#Proceeds from securities sold short.... $ -- $ -- $ 3,835,983 $ --
============ ============ ============ ============
- --------
+See Note 1
See Notes to Financial Statements
6
SunAmerica Equity Funds
STATEMENT OF ASSETS AND LIABILITIES -- March 31, 2004 -- (unaudited)
(continued)
International
Equity Value
Fund Fund+
------------- -----------
Class A (unlimited shares authorized):
Net assets............................................................................................ $34,129,047 $72,534,370
Shares of beneficial interest issued and outstanding.................................................. 3,286,056 4,269,341
Net asset value and redemption price per share........................................................ $ 10.39 $ 16.99
Maximum sales charge (5.75% of offering price)........................................................ 0.63 1.04
----------- -----------
Maximum offering price to public...................................................................... $ 11.02 $ 18.03
=========== ===========
Class B (unlimited shares authorized):
Net assets............................................................................................ $27,253,036 $80,353,192
Shares of beneficial interest issued and outstanding.................................................. 2,754,581 4,913,600
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred
sales charge)........................................................................................ $ 9.89 $ 16.35
=========== ===========
Class C+ (unlimited shares authorized):
Net assets............................................................................................ $16,905,315 $24,934,488
Shares of beneficial interest issued and outstanding.................................................. 1,710,323 1,524,932
Net asset value, offering and redemption price per share.............................................. $ 9.88 $ 16.35
=========== ===========
Class I++ (unlimited shares authorized):
Net assets............................................................................................ $ 7,960,993 $ 7,888,660
Shares of beneficial interest issued and outstanding.................................................. 762,937 464,711
Net asset value, offering and redemption price per share.............................................. $ 10.43 $ 16.98
=========== ===========
Class Z++ (unlimited shares authorized):
Net assets............................................................................................ $ -- $ 5,475,895
Shares of beneficial interest issued and outstanding.................................................. -- 314,352
Net asset value, offering and redemption price per share.............................................. $ -- $ 17.42
=========== ===========
Class X (unlimited shares authorized):
Net assets............................................................................................ $ -- $ --
Shares of beneficial interest issued and outstanding.................................................. -- --
Net asset value, offering and redemption price per share.............................................. $ -- $ --
=========== ===========
Biotech/ Tax Managed
Health Equity
Fund+ Fund+
----------- -----------
Class A (unlimited shares authorized):
Net assets............................................................................................ $20,310,263 $15,102,592
Shares of beneficial interest issued and outstanding.................................................. 1,921,199 1,339,750
Net asset value and redemption price per share........................................................ $ 10.57 $ 11.27
Maximum sales charge (5.75% of offering price)........................................................ 0.64 0.69
----------- -----------
Maximum offering price to public...................................................................... $ 11.21 $ 11.96
=========== ===========
Class B (unlimited shares authorized):
Net assets............................................................................................ $18,245,647 $22,257,562
Shares of beneficial interest issued and outstanding.................................................. 1,769,894 2,041,573
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred
sales charge)........................................................................................ $ 10.31 $ 10.90
=========== ===========
Class C+ (unlimited shares authorized):
Net assets............................................................................................ $13,158,635 $21,860,337
Shares of beneficial interest issued and outstanding.................................................. 1,274,351 2,002,338
Net asset value, offering and redemption price per share.............................................. $ 10.33 $ 10.92
=========== ===========
Class I++ (unlimited shares authorized):
Net assets............................................................................................ $ -- $ --
Shares of beneficial interest issued and outstanding.................................................. -- --
Net asset value, offering and redemption price per share.............................................. $ -- $ --
=========== ===========
Class Z++ (unlimited shares authorized):
Net assets............................................................................................ $ -- $ --
Shares of beneficial interest issued and outstanding.................................................. -- --
Net asset value, offering and redemption price per share.............................................. $ -- $ --
=========== ===========
Class X (unlimited shares authorized):
Net assets............................................................................................ $ -- $ --
Shares of beneficial interest issued and outstanding.................................................. -- --
Net asset value, offering and redemption price per share.............................................. $ -- $ --
=========== ===========
- --------
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++ See Note 1
See Notes to Financial Statements
7
SunAmerica Equity Funds
STATEMENT OF OPERATIONS -- For period ended March 31.
2004 -- (unaudited)
Blue Chip Growth
Growth Opportunities
Fund Fund
----------- -------------
INVESTMENT INCOME:
Investment income:
Interest................................................................................ $ 13,011 $ 59,873
Dividends*.............................................................................. 652,106 376,024
----------- -----------
Total investment income................................................................ 665,117 435,897
----------- -----------
Expenses:
Investment advisory and management fees................................................. 473,454 533,781
Distribution and service maintenance fees:
Class A................................................................................ 123,446 113,295
Class B................................................................................ 161,124 202,674
Class C+............................................................................... 38,912 101,505
Class Z#............................................................................... -- --
Class X................................................................................ -- --
Service fees Class I.................................................................... 19,633 6,157
Transfer agent fees and expenses:
Class A................................................................................ 101,004 98,337
Class B................................................................................ 56,624 71,277
Class C+............................................................................... 14,301 36,349
Class I#............................................................................... 17,597 5,601
Class Z#............................................................................... -- --
Class X................................................................................ -- 13,366
Registration fees:
Class A................................................................................ 7,092 8,234
Class B................................................................................ 5,536 6,130
Class C+............................................................................... 1,285 4,346
Class I#............................................................................... 4,323 4,346
Class Z#............................................................................... -- --
Class X................................................................................ -- 709
Custodian fees and expenses............................................................. 30,218 31,934
Reports to shareholders................................................................. 21,777 30,625
Audit and tax fees...................................................................... 15,649 18,051
Legal fees.............................................................................. 4,369 3,980
Trustees' fees.......................................................................... 7,065 8,164
Interest expense........................................................................ 1,447 --
Insurance expense....................................................................... 1,843 1,869
Dividend expense on securities sold short............................................... -- --.
Other expenses.......................................................................... 3,873 3,653
----------- -----------
Total expenses before reimbursements and custody credits................................ 1,110,572 1,304,383
Expenses reimbursed by the investment advisor........................................... (6,406) (5,170)
Custody credits earned on cash balances................................................. (45) (1,349)
Fees paid indirectly.................................................................... -- --.
----------- -----------
Net expenses.............................................................................. 1,104,121 1,297,864
----------- -----------
Net investment income (loss).............................................................. (439,004) (861,967)
----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN
CURRENCIES:
Net realized gain (loss) on investments**................................................. 11,751,541 14,868,642.
Net realized foreign exchange gain (loss) on other assets and liabilities................. -- --.
Net realized gain (loss) on futures and options contracts................................. -- --.
Net realized gain (loss) on securities sold short......................................... -- --.
Change in unrealized appreciation (depreciation) on investments........................... 2,360,423 2,813,047.
Change in unrealized appreciation (depreciation) on securities sold short................. -- --.
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities.............................................................................. -- --.
Change in unrealized appreciation (depreciation) on futures and options contracts......... -- --.
----------- -----------
Net realized and unrealized gain (loss) on investments and foreign exchange gain (loss) on
other assets and liabilities............................................................. 14,111,964 17,681,689
----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS........................... $13,672,960 $16,819,722
=========== ===========
*Net of foreign withholding taxes on dividends of......................................... $ 4,983 $ 2,119
=========== ===========
**Net of foreign withholding taxes on capital gains of.................................... $ -- $ --
=========== ===========
New Growth and Balanced
Century Income Assets
Fund Fund Fund
----------- ----------- -----------
INVESTMENT INCOME:
Investment income:
Interest................................................................................ $ 20,296 $ 8,708 $ 1,856,277
Dividends*.............................................................................. 207,869 1,439,105 1,175,440
----------- ----------- -----------
Total investment income................................................................ 228,165 1,447,813 3,031,717
----------- ----------- -----------
Expenses:
Investment advisory and management fees................................................. 414,690 768,108 955,832
Distribution and service maintenance fees:
Class A................................................................................ 155,600 131,771 311,501
Class B................................................................................ 77,635 335,091 237,035
Class C+............................................................................... 11,356 256,939 130,070
Class Z#............................................................................... -- -- --
Class X................................................................................ -- -- --
Service fees Class I.................................................................... 4,840 13,907 4,356
Transfer agent fees and expenses:
Class A................................................................................ 125,162 107,595 257,697
Class B................................................................................ 28,009 101,254 73,709
Class C+............................................................................... 5,356 73,220 36,067
Class I#............................................................................... 4,658 12,388 4,131
Class Z#............................................................................... -- -- --
Class X................................................................................ -- -- --
Registration fees:
Class A................................................................................ 10,543 6,908 9,722
Class B................................................................................ 4,734 7,365 5,970
Class C+............................................................................... 4,391 2,103 5,078
Class I#............................................................................... 3,773 3,694 4,483
Class Z#............................................................................... -- -- --
Class X................................................................................ -- -- --
Custodian fees and expenses............................................................. 30,029 35,272 45,025
Reports to shareholders................................................................. 19,078 29,576 39,913
Audit and tax fees...................................................................... 15,695 18,280 16,084
Legal fees.............................................................................. 3,156 5,009 3,842
Trustees' fees.......................................................................... 5,869 13,705 15,705
Interest expense........................................................................ 6,489 4,615 1,470
Insurance expense....................................................................... 1,608 3,472 4,286
Dividend expense on securities sold short............................................... -- -- --
Other expenses.......................................................................... 3,405 4,093 3,553
----------- ----------- -----------
Total expenses before reimbursements and custody credits................................ 936,076 1,934,365 2,165,529
Expenses reimbursed by the investment advisor........................................... (12,290) (4,412) (4,637)
Custody credits earned on cash balances................................................. (222) (45) (77)
Fees paid indirectly.................................................................... -- -- --
----------- ----------- -----------
Net expenses.............................................................................. 923,564 1,929,908 2,160,815
----------- ----------- -----------
Net investment income (loss).............................................................. (695,399) (482,095) 870,902
----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN
CURRENCIES:
Net realized gain (loss) on investments**................................................. 11,493,526 13,433,744 11,913,739
Net realized foreign exchange gain (loss) on other assets and liabilities................. -- -- --
Net realized gain (loss) on futures and options contracts................................. (9,065) -- --
Net realized gain (loss) on securities sold short......................................... -- -- --
Change in unrealized appreciation (depreciation) on investments........................... (128,671) 10,823,331 6,935,782
Change in unrealized appreciation (depreciation) on securities sold short................. -- -- --
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities.............................................................................. -- -- --
Change in unrealized appreciation (depreciation) on futures and options contracts......... -- -- --
----------- ----------- -----------
Net realized and unrealized gain (loss) on investments and foreign exchange gain (loss) on
other assets and liabilities............................................................. 11,355,790 24,257,075 18,849,521
----------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS........................... $10,660,391 $23,774,980 $19,720,423
=========== =========== ===========
*Net of foreign withholding taxes on dividends of......................................... $ 2,054 $ 2,673 $ 2,075
=========== =========== ===========
**Net of foreign withholding taxes on capital gains of.................................... $ -- $ -- $ --
=========== =========== ===========
- --------
+Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
#See Note 1
See Notes to Financial Statements
8
SunAmerica Equity Funds
STATEMENT OF OPERATIONS -- For the period ended March 31, 2003 --
(continued)
International
Equity Value
Fund Fund++ Value
(unaudited) (unaudited) Fund+++
------------- ----------- -----------
INVESTMENT INCOME:
Investment income:
Interest............................................... $ 7,148 $ 325,898 $ 902,965
Dividends*............................................. 597,959 3,259,590 5,207,118
----------- ----------- -----------
Total investment income.............................. 605,107 3,585,488 6,110,083
----------- ----------- -----------
Expenses:
Investment advisory and management fees................ 482,128 803,539 1,665,726
Distribution and service maintenance fees:
Class A.............................................. 56,798 95,276 194,543
Class B.............................................. 138,500 353,116 801,861
Class C+............................................. 82,500 102,003 206,360
Class Z#............................................. -- -- --
Class X.............................................. -- -- --
Service fees Class I................................... 24,712 7,637 13,837
Transfer agent fees and expenses:
Class A.............................................. 49,608 67,980 151,672
Class B.............................................. 48,741 88,749 219,310
Class C+............................................. 28,256 26,241 56,264
Class I#............................................. 22,365 6,890 8,045
Class Z#............................................. -- 7,560 19,137
Class X.............................................. -- -- --
Registration fees:
Class A.............................................. 9,559 1,743 15,541
Class B.............................................. 5,421 2,428 7,831
Class C+............................................. 3,911 5,016 11,590
Class I#............................................. 4,918 3,952 9,313
Class Z#............................................. -- 2,432 6,733
Class X.............................................. -- -- --
Custodian fees and expenses............................ 104,818 26,083 65,631
Reports to shareholders................................ 19,052 29,336 63,130
Audit and tax fees..................................... 19,997 12,160 33,169
Legal fees............................................. 5,147 3,952 7,808
Trustees' fees......................................... 5,298 5,604 14,497
Interest expenses...................................... 3,796 -- 224
Insurance expenses..................................... 1,404 1,875 3,217
Dividend expense on securities sold short.............. -- -- --
Other expenses......................................... 3,786 1,063 4,692
----------- ----------- -----------
Total expenses before reimbursements and custody
credits.............................................. 1,120,715 1,654,635 3,580,131
Expenses reimbursed by the investment advisor.......... (70,916) (11,497) (34,264)
Custody credits earned on cash balances................ -- (243) (745)
Fees paid indirectly................................... -- -- (11,394)
----------- ----------- -----------
Net expenses............................................ 1,049,799 1,642,895 3,533,728
----------- ----------- -----------
Net investment income (loss)............................ (444,692) 1,942,593 2,576,355
----------- ----------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCIES:
Net realized gain (loss) on investments **.............. 16,170,141 10,896,010 5,327,763
Net realized foreign exchange gain (loss) on other
assets and liabilities................................. (29,131) 326,945 (12,227)
Net realized gain (loss) on futures and options
contracts.............................................. 111,247 7,603 114,854
Net realized gain (loss) on securities sold short....... -- -- --
Change in unrealized appreciation (depreciation) on
investments............................................ 1,583,660 3,231,372 16,976,963
Change in unrealized appreciation (depreciation) on
securities sold short.................................. -- -- --
Change in unrealized foreign exchange gain (loss) on
transactions and other assets and liabilities.......... 1,041 (158,217) 2,901
Change in unrealized appreciation (depreciation) on
futures and options contracts.......................... 92,887 -- (105,897)
----------- ----------- -----------
Net realized and unrealized gain (loss) on investments
and foreign exchange gain (loss) on other assets and
liabilities............................................ 17,929,845 14,303,713 22,304,357
----------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................. $17,485,153 $16,246,306 $24,880,712
=========== =========== ===========
*Net of foreign withholding taxes on dividends of...... $ 70,310 $ 11,945 $ 53,560
=========== =========== ===========
**Net of foreign withholding taxes on capital gains of.. $ 18,130 $ -- $ --
=========== =========== ===========
- --------
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++ For the period November 1, 2003 through March 31, 2004.
+++For the period November 1, 2002 through October 31, 2003. See Note 2
# See Note 1
See Notes to Financial Statements
9
SunAmerica Equity Fund
STATEMENT OF OPERATIONS -- For the period ended March 31, 2003 --
(continued)
Biotech/ Tax Managed
Health Biotech/ Equity Tax Managed
Fund++ Health Fund++ Equity
(unaudited) Fund+++ (unaudited) Fund+++
----------- ----------- ----------- -----------
INVESTMENT INCOME:
Investment income:
Interest............................................... $ 25,691 $ 77,241 $ 168 $ 1,733
Dividends*............................................. 67,452 26,050 420,037 1,098,402
---------- ----------- ---------- -----------
Total investment income.............................. 93,143 103,291 420,205 1,100,135
---------- ----------- ---------- -----------
Expenses:
Investment advisory and management fees................ 160,281 331,090 215,211 519,867
Distribution and service maintenance fees:
Class A.............................................. 29,053 57,668 22,246 52,568
Class B.............................................. 76,389 162,390 95,438 230,393
Class C+............................................. 54,311 114,299 94,191 231,020
Class Z#............................................. -- -- -- --
Class X.............................................. -- -- -- --
Service fees Class I................................... -- -- -- --
Transfer agent fees and expenses:
Class A.............................................. 23,734 50,186 16,720 40,285
Class B.............................................. 25,318 56,418 24,796 60,631
Class C+............................................. 18,941 42,251 24,066 59,631
Class I#............................................. -- -- -- --
Class Z#............................................. -- -- -- --
Class X.............................................. -- -- -- --
Registration fees:
Class A.............................................. -- 19,532 -- 10,663
Class B.............................................. -- 17,718 -- 10,873
Class C+............................................. -- 17,718 -- 11,303
Class I#............................................. -- -- -- --
Class Z#............................................. -- -- -- --
Class X.............................................. -- -- -- --
Custodian fees and expenses............................ 22,137 52,446 21,887 54,232
Reports to shareholders................................ 24,098 5,470 9,639 861
Audit and tax fees..................................... 14,324 27,525 14,419 27,294
Legal fees............................................. 3,132 6,202 3,830 8,843
Trustees' fees......................................... 1,603 3,897 2,205 6,152
Interest expenses...................................... -- -- -- --
Insurance expenses..................................... 496 -- 759 --
Dividend expense on securities sold short.............. -- 9,650 -- --
Other expenses......................................... 5,920 7,914 4,488 9,187
---------- ----------- ---------- -----------
Total expenses before reimbursements and custody
credits.............................................. 459,737 982,374 549,895 1,333,803
Expenses reimbursed by the investment advisor.......... (43,469) (117,176) (59,513) (146,883)
Custody credits earned on cash balances................ (60) (1,098) (5) (166)
Fees paid indirectly................................... -- -- -- --
---------- ----------- ---------- -----------
Net expenses............................................ 416,208 864,100 490,377 1,186,754
---------- ----------- ---------- -----------
Net investment income (loss)............................ (323,065) (760,809) (70,172) (86,619)
---------- ----------- ---------- -----------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND
FOREIGN CURRENCIES:
Net realized gain (loss) on investments **.............. 2,656,186 (637,572) (617,837) (4,260,050)
Net realized foreign exchange gain (loss) on other
assets and liabilities................................. -- -- -- --
Net realized gain (loss) on futures and options
contracts.............................................. -- -- -- --
Net realized gain (loss) on securities sold short....... (241,028) (244,929) -- --
Change in unrealized appreciation (depreciation) on
investments............................................ 1,677,904 12,128,174 4,995,519 13,156,086
Change in unrealized appreciation (depreciation) on
securities sold short.................................. (52,905) 262,100 -- --
Change in unrealized foreign exchange gain (loss) on
transactions and other assets and liabilities.......... -- -- -- --
Change in unrealized appreciation (depreciation) on
futures and options contracts.......................... -- -- -- --
---------- ----------- ---------- -----------
Net realized and unrealized gain (loss) on investments
and foreign exchange gain (loss) on other assets and
liabilities............................................ 4,040,157 11,507,773 4,377,682 8,896,036
---------- ----------- ---------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................. $3,717,092 $10,746,964 $4,307,510 $ 8,809,417
========== =========== ========== ===========
*Net of foreign withholding taxes on dividends of...... $ -- $ -- $ 88 $ 159
========== =========== ========== ===========
**Net of foreign withholding taxes on capital gains of.. $ -- $ -- $ -- $ --
========== =========== ========== ===========
- --------
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++ For the period November 1, 2003 through March 31, 2004.
+++For the period November 1, 2002 through October 31, 2003. See Note 2
# See Note 1
10
SunAmerica Equity Fund
STATEMENT OF CHANGES IN NET ASSETS
Blue Chip Growth Fund
-----------------------------
For the
six months ended For the year
March 31, ended
2004 September 30,
(unaudited) 2003
---------------- -------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)........................................................... $ (439,004) $ (865,083)
Net realized gain (loss) on investments................................................ 11,751,541 (14,883,864)
Net realized foreign exchange gain (loss) on other assets and liabilities.............. -- --
Net realized gain (loss) on futures and options contracts.............................. -- --
Net realized gain (loss) on securities sold short...................................... -- --
Change in unrealized appreciation (depreciation) on investments........................ 2,360,423 34,594,963
Change in unrealized appreciation (depreciation) on securities sold short.............. -- --
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities........................................................................... -- --
Change in unrealized appreciation (depreciation) on futures and options contracts...... -- --
------------ ------------
Net increase (decrease) in net assets resulting from operations.......................... 13,672,960 18,846,016
------------ ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)........................................................ -- --
Net investment income (Class B)........................................................ -- --
Net investment income (Class C)+....................................................... -- --
Net investment income (Class I)++...................................................... -- --
Net investment income (Class Z)++...................................................... -- --
Net investment income (Class X)........................................................ -- --
Net realized gain on investments (Class A)............................................. -- --
Net realized gain on investments (Class B)............................................. -- --
Net realized gain on investments (Class C)+............................................ -- --
Net realized gain on investments (Class I)++........................................... -- --
Net realized gain on investments (Class Z)++........................................... -- --
Net realized gain on investments (Class X)............................................. -- --
------------ ------------
Total dividends and distributions to shareholders........................................ -- --
------------ ------------
Net increase in net assets resulting from capital share transactions
(Note 7)................................................................................ (24,510,267) (11,161,768)
------------ ------------
Total increase (decrease) in net assets.................................................. (10,837,307) 7,684,248
NET ASSETS:
Beginning of period...................................................................... 121,998,389 114,314,141
------------ ------------
End of period*........................................................................... $111,161,082 $121,998,389
============ ============
* Includes accumulated undistributed net investment income (loss)........................ $ (469,668) $ (30,664)
============ ============
Growth Opportunities Fund
-----------------------------
For the
six months ended For the year
March 31, ended
2004 September 30,
(unaudited) 2003
---------------- -------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)........................................................... $ (861,967) $ (1,710,261)
Net realized gain (loss) on investments................................................ 14,868,642 3,180,317
Net realized foreign exchange gain (loss) on other assets and liabilities.............. -- 23
Net realized gain (loss) on futures and options contracts.............................. -- --
Net realized gain (loss) on securities sold short...................................... -- --
Change in unrealized appreciation (depreciation) on investments........................ 2,813,047 35,797,632
Change in unrealized appreciation (depreciation) on securities sold short.............. -- --
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities........................................................................... -- --
Change in unrealized appreciation (depreciation) on futures and options contracts...... -- --
------------ ------------
Net increase (decrease) in net assets resulting from operations.......................... 16,819,722 37,267,711
------------ ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)........................................................ -- --
Net investment income (Class B)........................................................ -- --
Net investment income (Class C)+....................................................... -- --
Net investment income (Class I)++...................................................... -- --
Net investment income (Class Z)++...................................................... -- --
Net investment income (Class X)........................................................ -- --
Net realized gain on investments (Class A)............................................. -- --
Net realized gain on investments (Class B)............................................. -- --
Net realized gain on investments (Class C)+............................................ -- --
Net realized gain on investments (Class I)++........................................... -- --
Net realized gain on investments (Class Z)++........................................... -- --
Net realized gain on investments (Class X)............................................. -- --
------------ ------------
Total dividends and distributions to shareholders........................................ -- --
------------ ------------
Net increase in net assets resulting from capital share transactions
(Note 7)................................................................................ (10,790,498) (7,535,129)
------------ ------------
Total increase (decrease) in net assets.................................................. 6,029,224 29,732,582
NET ASSETS:
Beginning of period...................................................................... $136,000,995 106,268,413
------------ ------------
End of period*........................................................................... $142,030,219 $136,000,995
============ ============
* Includes accumulated undistributed net investment income (loss)........................ $ (886,659) $ (24,692)
============ ============
- --------
+Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++See Note 1
See Notes to Financial Statements
11
SunAmerica Equity Funds
STATEMENT OF CHANGES IN NET ASSETS -- (continued)
New Century Fund
-----------------------------
For the
six months ended For the year
March 31, ended
2004 September 30,
(unaudited) 2003
---------------- -------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)........................................................... $ (695,399) $ (1,261,893)
Net realized gain (loss) on investments................................................ 11,493,526 (14,089,380)
Net realized foreign exchange gain (loss) on other assets and liabilities.............. -- --
Net realized gain (loss) on futures and options contracts.............................. (9,065) 116,181
Net realized gain (loss) on securities sold short...................................... -- --
Change in unrealized appreciation (depreciation) on investments........................ (128,671) 33,831,669
Change in unrealized appreciation (depreciation) on securities sold short.............. -- --
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities........................................................................... -- --
Change in unrealized appreciation (depreciation) on futures and options contracts...... -- (37,628)
------------ ------------
Net increase (decrease) in net assets resulting from operations.......................... 10,660,391 18,558,949
------------ ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)........................................................ -- --
Net investment income (Class B)........................................................ -- --
Net investment income (Class C)+....................................................... -- --
Net investment income (Class I)++...................................................... -- --
Net investment income (Class Z)++...................................................... -- --
Net investment income (Class X)........................................................ -- --
Net realized gain on investments (Class A)............................................. -- --
Net realized gain on investments (Class B)............................................. -- --
Net realized gain on investments (Class C)+............................................ -- --
Net realized gain on investments (Class I)++........................................... -- --
Net realized gain on investments (Class Z)++........................................... -- --
Net realized gain on investments (Class X)............................................. -- --
------------ ------------
Total dividends and distributions to shareholders........................................ -- --
------------ ------------
Net increase in net assets resulting from capital share transactions
(Note 7)................................................................................ (17,781,775) (15,057,929)
------------ ------------
Total increase (decrease) in net assets.................................................. (7,121,384) 3,501,020
NET ASSETS:
Beginning of period...................................................................... 108,520,672 105,019,652
------------ ------------
End of period*........................................................................... $101,399,288 $108,520,672
============ ============
* Includes accumulated undistributed net investment income (loss)........................ $ (749,039) $ (53,640)
============ ============
Growth and Income Fund
-----------------------------
For the
six months ended For the year
March 31, ended
2004 September 30,
(unaudited) 2003
---------------- -------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)........................................................... $ (482,095) $ (705,030)
Net realized gain (loss) on investments................................................ 13,433,744 (35,762,966)
Net realized foreign exchange gain (loss) on other assets and liabilities.............. -- --
Net realized gain (loss) on futures and options contracts.............................. -- --
Net realized gain (loss) on securities sold short...................................... -- --
Change in unrealized appreciation (depreciation) on investments........................ 10,823,331 64,603,752
Change in unrealized appreciation (depreciation) on securities sold short.............. -- --
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities........................................................................... -- --
Change in unrealized appreciation (depreciation) on futures and options contracts...... -- --
------------ ------------
Net increase (decrease) in net assets resulting from operations.......................... 23,774,980 28,135,756
------------ ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)........................................................ -- --
Net investment income (Class B)........................................................ -- --
Net investment income (Class C)+....................................................... -- --
Net investment income (Class I)++...................................................... -- --
Net investment income (Class Z)++...................................................... -- --
Net investment income (Class X)........................................................ -- --
Net realized gain on investments (Class A)............................................. -- --
Net realized gain on investments (Class B)............................................. -- --
Net realized gain on investments (Class C)+............................................ -- --
Net realized gain on investments (Class I)++........................................... -- --
Net realized gain on investments (Class Z)++........................................... -- --
Net realized gain on investments (Class X)............................................. -- --
------------ ------------
Total dividends and distributions to shareholders........................................ -- --
------------ ------------
Net increase in net assets resulting from capital share transactions
(Note 7)................................................................................ (34,409,465) (51,963,968)
------------ ------------
Total increase (decrease) in net assets.................................................. (10,634,485) (23,828,212)
NET ASSETS:
Beginning of period...................................................................... 199,696,299 223,524,511
------------ ------------
End of period*........................................................................... $189,061,814 $199,696,299
============ ============
* Includes accumulated undistributed net investment income (loss)........................ $ (518,321) $ (36,226)
============ ============
- --------
+Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++See Note 1
See Notes to Financial Statements
12
SunAmerica Equity Funds
STATEMENT OF CHANGES IN NET ASSETS -- (continued)
Balanced Assets Fund
-----------------------------
For the
six months ended For the year
March 31, ended
2004 September 30,
(unaudited) 2003
---------------- -------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)........................................................... $ 870,902 $ 1,760,432
Net realized gain (loss) on investments................................................ 11,913,739 (28,335,937)
Net realized foreign exchange gain (loss) on other assets and liabilities.............. -- 382
Net realized gain (loss) on futures and options contracts.............................. -- --
Net realized gain (loss) on securities sold short...................................... -- --
Change in unrealized appreciation (depreciation) on investments........................ 6,935,782 42,771,990
Change in unrealized appreciation (depreciation) on securities sold short.............. -- --
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities........................................................................... -- (61)
Change in unrealized appreciation (depreciation) on futures and options contracts...... -- --
------------ ------------
Net increase (decrease) in net assets resulting from operations.......................... 19,720,423 16,196,806
------------ ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)........................................................ (927,853) (1,750,489)
Net investment income (Class B)........................................................ (92,775) (190,530)
Net investment income (Class C)+....................................................... (51,510) (97,381)
Net investment income (Class I)++...................................................... (18,435) (50,394)
Net investment income (Class Z)++...................................................... -- --
Net investment income (Class X)........................................................ -- --
Net realized gain on investments (Class A)............................................. -- --
Net realized gain on investments (Class B)............................................. -- --
Net realized gain on investments (Class C)+............................................ -- --
Net realized gain on investments (Class I)++........................................... -- --
Net realized gain on investments (Class Z)++........................................... -- --
Net realized gain on investments (Class X)............................................. -- --
------------ ------------
Total dividends and distributions to shareholders........................................ (1,090,573) (2,088,794)
------------ ------------
Net increase in net assets resulting from capital share transactions
(Note 7)................................................................................ (24,715,143) (45,385,301)
------------ ------------
Total increase (decrease) in net assets.................................................. (6,085,293) (31,277,289)
NET ASSETS:
Beginning of period...................................................................... 253,177,254 284,454,543
------------ ------------
End of period*........................................................................... $247,091,961 $253,177,254
============ ============
* Includes accumulated undistributed net investment income (loss)........................ $ (232,085) $ (12,414)
============ ============
International Equity Fund
-----------------------------
For the
six months ended For the year
March 31, ended
2004 September 30,
(unaudited) 2003
---------------- -------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)........................................................... $ (444,692) $ 35,865
Net realized gain (loss) on investments................................................ 16,170,141 (4,807,957)
Net realized foreign exchange gain (loss) on other assets and liabilities.............. (29,131) (62,455)
Net realized gain (loss) on futures and options contracts.............................. 111,247 (429,413)
Net realized gain (loss) on securities sold short...................................... -- --
Change in unrealized appreciation (depreciation) on investments........................ 1,583,660 26,498,054
Change in unrealized appreciation (depreciation) on securities sold short.............. -- --
Change in unrealized foreign exchange gain (loss) on transactions and other assets and
liabilities........................................................................... 1,041 16,646
Change in unrealized appreciation (depreciation) on futures and options contracts...... 92,887 59,687
------------ ------------
Net increase (decrease) in net assets resulting from operations.......................... 17,485,153 21,310,427
------------ ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)........................................................ (11,064) --
Net investment income (Class B)........................................................ -- --
Net investment income (Class C)+....................................................... -- --
Net investment income (Class I)++...................................................... (17,397) --
Net investment income (Class Z)++...................................................... -- --
Net investment income (Class X)........................................................ -- --
Net realized gain on investments (Class A)............................................. -- --
Net realized gain on investments (Class B)............................................. -- --
Net realized gain on investments (Class C)+............................................ -- --
Net realized gain on investments (Class I)++........................................... -- --
Net realized gain on investments (Class Z)++........................................... -- --
Net realized gain on investments (Class X)............................................. -- --
------------ ------------
Total dividends and distributions to shareholders........................................ (28,461) --
------------ ------------
Net increase in net assets resulting from capital share transactions
(Note 7)................................................................................ (20,012,486) (19,779,286)
------------ ------------
Total increase (decrease) in net assets.................................................. (2,555,794) 1,531,141
NET ASSETS:
Beginning of period...................................................................... 88,804,185 87,273,044
------------ ------------
End of period*........................................................................... $ 86,248,391 $ 88,804,185
============ ============
* Includes accumulated undistributed net investment income (loss)........................ $ (567,197) $ (94,044)
============ ============
- --------
+Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++See Note 1
See Notes to Financial Statements
13
SunAmerica Equity Funds
STATEMENT OF CHANGES IN NET ASSETS -- (continued)
Value Fund
----------------------------------------------
For the five months
ended For the year For the year
March 31, ended ended
2004 October 31, October 31,
(unaudited) 2003 2002
------------------- ------------ ------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)................................ $ 1,942,593 $ 2,576,355 $ 1,236,209
Net realized gain (loss) on investments..................... 10,896,010 5,327,763 6,868,788
Net realized foreign exchange gain (loss) on other assets
and liabilities............................................ 326,945 (12,227) (63,935)
Net realized gain (loss) on futures and options contracts... 7,603 114,854 (4,041,588)
Net realized gain (loss) on securities sold short........... -- -- --
Change in unrealized appreciation (depreciation) on
investments................................................ 3,231,372 16,976,963 (2,907,196)
Change in unrealized appreciation (depreciation) on
securities sold short...................................... -- -- --
Change in unrealized foreign exchange gain (loss) on
transactions and other assets and liabilities.............. (158,217) 2,901 (1,525)
Change in unrealized appreciation (depreciation) on futures
and options contracts...................................... -- (105,897) 80,407
------------ ------------ ------------
Net increase (decrease) in net assets resulting from
operations................................................... 16,246,306 24,880,712 1,171,160
------------ ------------ ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)............................. (1,362,535) (640,709) (311,360)
Net investment income (Class B)............................. (1,446,298) (441,621) (41,812)
Net investment income (Class C)+............................ (408,038) (107,249) (10,614)
Net investment income (Class I)++........................... (166,307) (64,209) (26,434)
Net investment income (Class Z)++........................... (126,802) (6,189) (5,148)
Net investment income (Class X)............................. -- -- --
Net realized gain on investments (Class A).................. (1,664,101) (1,668,760) (2,285,016)
Net realized gain on investments (Class B).................. (2,379,441) (2,600,325) (3,767,153)
Net realized gain on investments (Class C)+................. (671,301) (631,495) (956,324)
Net realized gain on investments (Class I)++................ (189,120) (153,195) (189,587)
Net realized gain on investments (Class Z)++................ (128,732) (11,260) (19,843)
Net realized gain on investments (Class X).................. -- -- --
------------ ------------ ------------
Total dividends and distributions to shareholders............. (8,542,675) (6,325,012) (7,613,291)
------------ ------------ ------------
Net increase in net assets resulting from capital share
transactions (Note 7)........................................ 4,477,830 7,300,864 12,481,749
------------ ------------ ------------
Total increase (decrease) in net assets....................... 12,181,461 25,856,564 6,039,618
NET ASSETS:
Beginning of period........................................... 179,005,144 153,148,580 147,108,962
------------ ------------ ------------
End of period*................................................ $191,186,605 $179,005,144 $153,148,580
============ ============ ============
* Includes accumulated undistributed net investment income
(loss)....................................................... $ 859,416 $ 2,426,803 $ 1,130,239
============ ============ ============
Biotech/Health Fund
---------------------------------------------
For the five months
ended For the year For the year
March 31, ended ended
2004 October 31, October 31,
(unaudited) 2003 2002
------------------- ------------ ------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)................................ $ (323,065) $ (760,809) $ (1,116,235)
Net realized gain (loss) on investments..................... 2,656,186 (637,572) (17,583,650)
Net realized foreign exchange gain (loss) on other assets
and liabilities............................................ -- -- --
Net realized gain (loss) on futures and options contracts... -- -- --
Net realized gain (loss) on securities sold short........... (241,028) (244,929) --
Change in unrealized appreciation (depreciation) on
investments................................................ 1,677,904 12,128,174 (5,200,198)
Change in unrealized appreciation (depreciation) on
securities sold short...................................... (52,905) 262,100 422,091
Change in unrealized foreign exchange gain (loss) on
transactions and other assets and liabilities.............. -- -- --
Change in unrealized appreciation (depreciation) on futures
and options contracts...................................... -- -- --
----------- ----------- ------------
Net increase (decrease) in net assets resulting from
operations................................................... 3,717,092 10,746,964 (23,477,992)
----------- ----------- ------------
Dividends and distributions to shareholders from:
Net investment income (Class A)............................. -- -- --
Net investment income (Class B)............................. -- -- --
Net investment income (Class C)+............................ -- -- --
Net investment income (Class I)++........................... -- -- --
Net investment income (Class Z)++........................... -- -- --
Net investment income (Class X)............................. -- -- --
Net realized gain on investments (Class A).................. -- -- --
Net realized gain on investments (Class B).................. -- -- --
Net realized gain on investments (Class C)+................. -- -- --
Net realized gain on investments (Class I)++................ -- -- --
Net realized gain on investments (Class Z)++................ -- -- --
Net realized gain on investments (Class X).................. -- -- --
----------- ----------- ------------
Total dividends and distributions to shareholders............. -- -- --
----------- ----------- ------------
Net increase in net assets resulting from capital share
transactions (Note 7)........................................ (1,430,403) (5,616,681) (9,222,459)
----------- ----------- ------------
Total increase (decrease) in net assets....................... 2,286,689 5,130,283 (32,700,451)
NET ASSETS:
Beginning of period........................................... 49,427,856 44,297,573 76,998,024
----------- ----------- ------------
End of period*................................................ $51,714,545 $49,427,856 $ 44,297,573
=========== =========== ============
* Includes accumulated undistributed net investment income
(loss)....................................................... $ (326,242) $ (3,177) $ (2,629)
=========== =========== ============
- --------
+Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++See Note 1
See Notes to Financial Statements
14
SunAmerica Equity Funds
STATEMENT OF CHANGES IN NET ASSETS -- (continued)
Tax Managed Equity Fund
---------------------------------------
For the
five months
ended For the year For the year
March 31, ended ended
2004 October 31, October 31,
(unaudited) 2003 2002
----------- ------------ ------------
INCREASE (DECREASE) IN NET ASSETS:
Operations:
Net investment income (loss)............. $ (70,172) $ (86,619) $ (393,346)
Net realized gain (loss) on investments.. (617,837) (4,260,050) (15,675,665)
Net realized foreign exchange gain
(loss) on other assets and
liabilities............................ -- -- --
Net realized gain (loss) on futures
and options contracts.................. -- -- --
Net realized gain (loss) on securities
sold short............................. -- -- --
Change in unrealized appreciation
(depreciation) on investments.......... 4,995,519 13,156,086 (2,347,140)
Change in unrealized appreciation
(depreciation) on securities sold
short.................................. -- -- --
Change in unrealized foreign exchange
gain (loss) on transactions and
other assets and liabilities........... -- -- --
Change in unrealized appreciation
(depreciation) on futures and
options contracts...................... -- -- --
----------- ------------ ------------
Net increase (decrease) in net assets
resulting from operations................ 4,307,510 8,809,417 (18,416,151)
----------- ------------ ------------
Dividends and distributions to
shareholders from:
Net investment income (Class A).......... -- -- --
Net investment income (Class B).......... -- -- --
Net investment income (Class C)+......... -- -- --
Net investment income (Class I)++........ -- -- --
Net investment income (Class Z)++........ -- -- --
Net investment income (Class X).......... -- -- --
Net realized gain on investments
(Class A).............................. -- -- --
Net realized gain on investments
(Class B).............................. -- -- --
Net realized gain on investments
(Class C)+............................. -- -- --
Net realized gain on investments
(Class I)++............................ -- -- --
Net realized gain on investments
(Class Z)++............................ -- -- --
Net realized gain on investments
(Class X).............................. -- -- --
----------- ------------ ------------
Total dividends and distributions to
shareholders............................. -- -- --
----------- ------------ ------------
Net increase in net assets resulting
from capital share transactions (Note
7)....................................... (5,694,042) (16,922,143) (25,890,226)
----------- ------------ ------------
Total increase (decrease) in net assets... (1,386,532) (8,112,726) (44,306,377)
NET ASSETS:
Beginning of period....................... 60,607,023 68,719,749 113,026,126
----------- ------------ ------------
End of period*............................ $59,220,491 $ 60,607,023 $ 68,719,749
=========== ============ ============
* Includes accumulated undistributed
net investment income (loss)............. $ (78,248) $ (8,076) $ (7,269)
=========== ============ ============
- --------
+Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
++See Note 1
See Notes to Financial Statements
15
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS --
BLUE CHIP GROWTH
----------------
Net gain
(loss) on Distri- Net Net
Net Asset Net investments Dividends butions Asset Assets
Value investment (both Total from from net from Total Value end of
beginning income realized and investment investment capital distri- end of Total period
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's)
- -------------------- --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- --------
Class A
-------
09/30/99 $18.61 $(0.05) $ 6.53 $ 6.48 $-- $(1.47) $(1.47) $23.62 36.29% $103,841
09/30/00 23.62 (0.14) 8.00 7.86 -- (2.46) (2.46) 29.02 34.66 152,788
09/30/01 29.02 (0.03) (11.13) (11.16) -- (3.51) (3.51) 14.35 (42.23) 82,523
09/30/02 14.35 (0.07) (3.13) (3.20) -- -- -- 11.15 (22.30) 59,812
09/30/03 11.15 (0.06) 2.03 1.97 -- -- -- 13.12 17.67 64,672
10/01/03-03/31/04(7) 13.12 (0.04) 1.47 1.43 -- -- -- 14.55 10.90 68,563
Class B
-------
09/30/99 $17.84 $(0.19) $ 6.25 $ 6.06 $-- $(1.47) $(1.47) $22.43 35.45% $ 49,015
09/30/00 22.43 (0.31) 7.58 7.27 -- (2.46) (2.46) 27.24 33.80 67,586
09/30/01 27.24 (0.16) (10.35) (10.51) -- (3.51) (3.51) 13.22 (42.66) 34,649
09/30/02 13.22 (0.16) (2.86) (3.02) -- -- -- 10.20 (22.84) 31,203
09/30/03 10.20 (0.14) 1.84 1.70 -- -- -- 11.90 16.67 30,263
10/01/03-03/31/04(7) 11.90 (0.08) 1.33 1.25 -- -- -- 13.15 10.50 31,816
Class C+
--------
02/02/99-09/30/99(3) $21.79 $(0.13) $ 0.77 $ 0.64 $-- $ -- $ -- $22.43 2.94% $ 785
09/30/00 22.43 (0.31) 7.53 7.22 -- (2.46) (2.46) 27.19 33.57 8,939
09/30/01 27.19 (0.15) (10.32) (10.47) -- (3.51) (3.51) 13.21 (42.58) 6,127
09/30/02 13.21 (0.16) (2.87) (3.03) -- -- -- 10.18 (22.94) 7,687
09/30/03 10.18 (0.16) 1.85 1.69 -- -- -- 11.87 16.60 7,286
10/01/03-03/31/04(7) 11.87 (0.08) 1.33 1.25 -- -- -- 13.12 10.53 7,567
Class I
-------
11/16/01-09/30/02(3) $16.30 $(0.04) $ (5.10) $ (5.14) $-- $ -- $ -- $11.16 (31.53)% $ 15,612
09/30/03 11.16 (0.04) 2.04 2.00 -- -- -- 13.16 17.92 19,778
10/01/03-03/31/04(7) 13.16 (0.02) 1.48 1.46 -- -- -- 14.62 11.09 3,215
Ratio of net
Ratio of investment
expenses income (loss)
to average to average Portfolio
Period Ended net assets net assets turnover
- -------------------- ---------- ------------- ---------
09/30/99 1.49% (0.22)% 71%
09/30/00 1.43 (0.49) 75
09/30/01 1.45 (0.15) 136
09/30/02 1.47(6) (0.47)(6) 107
09/30/03 1.54 (0.50) 114
10/01/03-03/31/04(7) 1.54(4) (0.49)(4) 78
09/30/99 2.15% (0.89)% 71%
09/30/00 2.09 (1.16) 75
09/30/01 2.19 (0.89) 136
09/30/02 2.18(6) (1.18)(6) 107
09/30/03 2.32 (1.28) 114
10/01/03-03/31/04(7) 2.27(4) (1.23)(4) 78
02/02/99-09/30/99(3) 2.17%(4)(5) (0.95)%(4)(5) 71%
09/30/00 2.17(5) (1.17)(5) 75
09/30/01 2.11(5) (0.81)(5) 136
09/30/02 2.23(5)(6) (1.25)(5)(6) 107
09/30/03 2.44(5) (1.40)(5) 114
10/01/03-03/31/04(7) 2.29(4)(5) (1.24)(4)(5) 78
11/16/01-09/30/02(3) 1.33%(4)(5)(6) (0.32)%(4)(5)(6) 107%
09/30/03 1.33(5) (0.29)(5) 114
10/01/03-03/31/04(7) 1.33(4)(5) (0.24)(4)(5) 78
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Commencement of sale of respective class of shares
(4)Annualized
(5)Net of the following expense reimbursements (based on average net assets):
09/30/99(4) 09/30/00 09/30/01 09/30/02(6) 09/30/03 03/31/04(4)
----------- -------- -------- ----------- -------- -----------
Blue Chip Growth Class C+............... 8.74% 0.17% 0.03% -- % -- % -- %
Blue Chip Growth Class I................ -- -- -- 0.08(4) 0.33 0.08
(6)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied, the ratio of expenses to average net
assets would have been lower by 0.01%.
(7)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
16
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
GROWTH OPPORTUNITIES FUND
-------------------------
Net gain
(loss) on Distri- Net Net
Net Asset Net investments Dividends butions Asset Assets Ratio of
Value investment (both Total from from net from Total Value end of expenses
beginning income realized and investment investment capital distri- end of Total period to average
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's) net assets
- ------------ --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- -------- ----------
Class A
-------
09/30/99 $16.22 $(0.19) $ 8.26 $ 8.07 $-- $(1.17) $(1.17) $23.12 52.42% $ 57,880 1.57%
09/30/00 23.12 (0.17) 21.77 21.60 -- (3.93) (3.93) 40.79 102.04 206,531 1.43
09/30/01 40.79 (0.14) (22.33) (22.47) -- (2.90) (2.90) 15.42 (58.23) 89,935 1.49
09/30/02 15.42 (0.17) (5.26) (5.43) -- -- -- 9.99 (35.21) 50,018 1.49(6)
09/30/03 9.99 (0.13) 3.88 3.75 -- -- -- 13.74 37.54 62,660 1.63
10/01/03-
03/31/04(7) 13.74 (0.07) 1.84 1.77 -- -- -- 15.51 12.88 63,740 1.57(4)
Class B
-------
09/30/99 $15.52 $(0.32) $ 7.85 $ 7.53 $-- $(1.17) $(1.17) $21.88 51.24% $ 16,529 2.32%
09/30/00 21.88 (0.37) 20.42 20.05 -- (3.93) (3.93) 38.00 100.58 108,083 2.10
09/30/01 38.00 (0.28) (20.66) (20.94) -- (2.90) (2.90) 14.16 (58.50) 54,902 2.17
09/30/02 14.16 (0.26) (4.79) (5.05) -- -- -- 9.11 (35.66) 33,221 2.18(6)
09/30/03 9.11 (0.20) 3.53 3.33 -- -- -- 12.44 36.55 38,870 2.36
10/01/03-
03/31/04(7) 12.44 (0.11) 1.66 1.55 -- -- -- 13.99 12.46 39,767 2.27(4)
Class C+
--------
02/02/99-
09/30/99(3) $19.86 $(0.21) $ 2.23 $ 2.02 $-- $ -- $ -- $21.88 10.17% $ 1,089 2.35%(4)(5)
09/30/00 21.88 (0.33) 20.35 20.02 -- (3.93) (3.93) 37.97 100.44 65,322 2.09(5)
09/30/01 37.97 (0.28) (20.64) (20.92) -- (2.90) (2.90) 14.15 (58.50) 31,594 2.16(5)
09/30/02 14.15 (0.26) (4.79) (5.05) -- -- -- 9.10 (35.69) 17,484 2.21(5)(6)
09/30/03 9.10 (0.20) 3.53 3.33 -- -- -- 12.43 36.59 19,808 2.33(5)
10/01/03-
03/31/04(7) 12.43 (0.11) 1.65 1.54 -- -- -- 13.97 12.39 19,551 2.29(4)(5)
Class I
-------
11/16/01-
09/30/02(3) $18.09 $(0.14) $ (7.95) $ (8.09) $-- $ -- $ -- $10.00 (44.72)% $ 3,054 1.33%(4)(5)(6)
09/30/03 10.00 (0.10) 3.90 3.80 -- -- -- 13.80 38.00 4,404 1.33(5)
10/01/03-
03/31/04(7) 13.80 (0.05) 1.85 1.80 -- -- -- 15.60 13.04 5,109 1.33(4)(5)
Class X
-------
03/19/02-
09/30/02(3) $18.19 $(0.08) $ (8.10) $ (8.18) $-- $ -- $ -- $10.01 (44.97)% $ 2,492 1.20%(4)(5)(6)
09/30/03 10.01 (0.07) 3.90 3.83 -- -- -- 13.84 38.26 10,258 1.17(5)
10/01/03-
03/31/04(7) 13.84 (0.04) 1.86 1.82 -- -- -- 15.66 13.15 13,863 1.12(4)(5)
Ratio of net
investment
income (loss)
to average Portfolio
Period Ended net assets turnover
- ------------ ------------- ---------
09/30/99 (0.93)% 220%
09/30/00 (0.49) 139
09/30/01 (0.57) 207
09/30/02 (1.11)(6) 344
09/30/03 (1.11) 204
10/01/03-
03/31/04(7) (0.95)(4) 94
09/30/99 (1.67)% 220%
09/30/00 (1.11) 139
09/30/01 (1.25) 207
09/30/02 (1.80)(6) 344
09/30/03 (1.85) 204
10/01/03-
03/31/04(7) (1.66)(4) 94
02/02/99-
09/30/99(3) (1.74)%(4)(5) 220%
09/30/00 (0.99)(5) 139
09/30/01 (1.24)(5) 207
09/30/02 (1.82)(5)(6) 344
09/30/03 (1.82)(5) 204
10/01/03-
03/31/04(7) (1.68)(4)(5) 94
11/16/01-
09/30/02(3) (0.95)%(4)(5)(6) 344%
09/30/03 (0.82)(5) 204
10/01/03-
03/31/04(7) (0.71)(4)(5) 94
03/19/02-
09/30/02(3) (0.83)%(4)(5)(6) 344%
09/30/03 (0.64)(5) 204
10/01/03-
03/31/04(7) (0.50)(4)(5) 94
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Commencement of sale of respective class of shares
(4)Annualized
(5)Net of the following expense reimbursements (based on average net assets):
09/30/99(4) 09/30/00 09/30/01 09/30/02(6) 09/30/03 03/31/04(4)
----------- -------- -------- ----------- -------- -----------
Growth Opportunities Class C+... 9.94% 0.01% -- % -- % -- % -- %
Growth Opportunities Class I.... -- -- -- 0.18(4) 0.50 0.21
Growth Opportunities Class X.... -- -- -- 0.38(4) 0.04 --
(6)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied, the ratio of expenses to average net
assets would have remained the same.
(7)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
17
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
NEW CENTURY FUND
----------------
Net gain
(loss) on Distri- Net Net
Net Asset Net investments Dividends butions Asset Assets Ratio of
Value investment (both Total from from net from Total Value end of expenses
beginning income realized and investment investment capital distri- end of Total period to average
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's) net assets
- ------------ --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- -------- ----------
Class A
-------
09/30/99 $19.10 $(0.21) $ 9.89 $ 9.68 $-- $(1.40) $(1.40) $27.38 53.00% $148,376 1.48%
09/30/00 27.38 (0.31) 19.04 18.73 -- (4.97) (4.97) 41.14 72.74 253,359 1.42
09/30/01 41.14 (0.05) (19.00) (19.05) -- (8.88) (8.88) 13.21 (54.88) 101,691 1.46
09/30/02 13.21 (0.13) (1.86) (1.99) -- -- -- 11.22 (15.06) 74,710 1.50
09/30/03 11.22 (0.13) 2.35 2.22 -- -- -- 13.44 19.79 85,685 1.57
10/01/03-
03/31/04(5) 13.44 (0.08) 1.42 1.34 -- -- -- 14.78 9.97 85,426 1.56(3)
Class B
-------
09/30/99 $18.34 $(0.35) $ 9.48 $ 9.13 $-- $(1.40) $(1.40) $26.07 52.15% $ 77,331 2.12%
09/30/00 26.07 (0.53) 18.04 17.51 -- (4.97) (4.97) 38.61 71.59 122,004 2.07
09/30/01 38.61 (0.17) (17.57) (17.74) -- (8.88) (8.88) 11.99 (55.15) 39,577 2.11
09/30/02 11.99 (0.20) (1.68) (1.88) -- -- -- 10.11 (15.68) 23,271 2.18
09/30/03 10.11 (0.20) 2.12 1.92 -- -- -- 12.03 18.99 16,078 2.28
10/01/03-
03/31/04(5) 12.03 (0.13) 1.28 1.15 -- -- -- 13.18 9.56 13,765 2.33(3)
Class C+
--------
09/30/99 $18.34 $(0.40) $ 9.51 $ 9.11 $-- $(1.40) $(1.40) $26.05 52.04% $ 2,599 2.15%(4)
09/30/00 26.05 (0.54) 18.01 17.47 -- (4.97) (4.97) 38.55 71.48 10,848 2.14(4)
09/30/01 38.55 (0.17) (17.54) (17.71) -- (8.88) (8.88) 11.96 (55.16) 4,508 2.13(4)
09/30/02 11.96 (0.20) (1.67) (1.87) -- -- -- 10.09 (15.64) 2,447 2.14(4)
09/30/03 10.09 (0.18) 2.11 1.93 -- -- -- 12.02 19.13 2,183 2.14(4)
10/01/03-
03/31/04(5) 12.02 (0.11) 1.28 1.17 -- -- -- 13.19 9.73 2,209 2.14(3)(4)
Ratio of net
investment
income (loss)
to average Portfolio
Period Ended net assets turnover
- ------------ ------------- ---------
09/30/99 (0.82)% 177%
09/30/00 (0.80) 227
09/30/01 (0.23) 282
09/30/02 (0.92) 199
09/30/03 (1.08) 123
10/01/03-
03/31/04(5) (1.15)(3) 32
09/30/99 (1.46)% 177%
09/30/00 (1.46) 227
09/30/01 (0.88) 282
09/30/02 (1.60) 199
09/30/03 (1.77) 123
10/01/03-
03/31/04(5) (1.91)(3) 32
09/30/99 (1.60)%(4) 177%
09/30/00 (1.47)(4) 227
09/30/01 (0.90)(4) 282
09/30/02 (1.56)(4) 199
09/30/03 (1.63)(4) 123
10/01/03-
03/31/04(5) (1.73)(3)(4) 32
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Annualized
(4)Net of the following expense reimbursements (based on average net assets):
09/30/99 09/30/00 09/30/01 09/30/02 09/30/03 03/31/04(4)
-------- -------- -------- -------- -------- -----------
New Century Class C+... 2.48% 0.05% 0.06% 0.27% 0.66% 0.62%
(5)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
18
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
GROWTH AND INCOME FUND
----------------------
Net gain
(loss) on Distri- Net
Net Asset Net investments Dividends butions Asset Net Assets
Value investment (both Total from from net from Total Value end of
beginning income realized and investment investment capital distri- end of Total period
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's)
- -------------------- --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- ----------
Class A
-------
09/30/99 $12.80 $(0.02) $ 3.92 $ 3.90 $-- $(0.47) $(0.47) $16.23 30.99% $ 86,524
09/30/00 16.23 (0.08) 4.51 4.43 -- (0.66) (0.66) 20.00 27.64 127,168
09/30/01 20.00 (0.03) (7.43) (7.46) -- (1.43) (1.43) 11.11 (39.45) 75,795
09/30/02 11.11 0.00 (2.24) (2.24) -- -- -- 8.87 (20.16) 71,482
09/30/03 8.87 0.01 1.31 1.32 -- -- -- 10.19 14.88 70,826
10/01/03-03/31/04(7) 10.19 (0.01) 1.25 1.24 -- -- -- 11.43 12.17 74,641
Class B
-------
09/30/99 $12.62 $(0.12) $ 3.87 $ 3.75 $-- $(0.47) $(0.47) $15.90 30.23% $121,709
09/30/00 15.90 (0.20) 4.40 4.20 -- (0.66) (0.66) 19.44 26.74 176,395
09/30/01 19.44 (0.12) (7.19) (7.31) -- (1.43) (1.43) 10.70 (39.85) 99,012
09/30/02 10.70 (0.07) (2.14) (2.21) -- -- -- 8.49 (20.65) 81,686
09/30/03 8.49 (0.06) 1.26 1.20 -- -- -- 9.69 14.13 66,378
10/01/03-03/31/04(7) 9.69 (0.04) 1.18 1.14 -- -- -- 10.83 11.76 62,807
Class C+
--------
09/30/99 $12.61 $(0.12) $ 3.87 $ 3.75 $-- $(0.47) $(0.47) $15.89 30.25% $ 11,135
09/30/00 15.89 (0.20) 4.39 4.19 -- (0.66) (0.66) 19.42 26.78 39,986
09/30/01 19.42 (0.13) (7.18) (7.31) -- (1.43) (1.43) 10.68 (39.89) 28,283
09/30/02 10.68 (0.07) (2.13) (2.20) -- -- -- 8.48 (20.60) 60,174
09/30/03 8.48 (0.06) 1.25 1.19 -- -- -- 9.67 14.03 49,593
10/01/03-03/31/04(7) 9.67 (0.04) 1.18 1.14 -- -- -- 10.81 11.79 49,670
Class I
-------
11/16/01-09/30/02(3) $12.29 $ 0.02 $(3.43) $(3.41) $-- $ -- $ -- $ 8.88 (27.75)% $ 9,877
09/30/03 8.88 0.02 1.31 1.33 -- -- -- 10.21 14.98 12,899
10/01/03-03/31/04(7) 10.21 0.01 1.24 1.25 -- -- -- 11.46 12.24 1,943
Ratio of net
Ratio of investment
expenses income (loss)
to average to average Portfolio
Period Ended net assets net assets turnover
- -------------------- ---------- ------------- ---------
09/30/99 1.48% (0.13)% 63%
09/30/00 1.44 (0.43) 61
09/30/01 1.45 (0.21) 126
09/30/02 1.50(6) (0.01)(6) 118
09/30/03 1.50 0.06 123
10/01/03-03/31/04(7) 1.52(4) (0.11)(4) 83
09/30/99 2.11% (0.76)% 63%
09/30/00 2.07 (1.07) 61
09/30/01 2.09 (0.85) 126
09/30/02 2.13(6) (0.66)(6) 118
09/30/03 2.16 (0.59) 123
10/01/03-03/31/04(7) 2.19(4) (0.77)(4) 83
09/30/99 2.15%(5) (0.80)%(5) 63%
09/30/00 2.10(5) (1.10)(5) 61
09/30/01 2.13(5) (0.88)(5) 126
09/30/02 2.17(5)(6) (0.68)(5)(6) 118
09/30/03 2.16(5) (0.60)(5) 123
10/01/03-03/31/04(7) 2.15(4)(5) (0.75)(4)(5) 83
11/16/01-09/30/02(3) 1.32%(4)(5)(6) 0.21%(4)(5)(6) 118%
09/30/03 1.32(5) 0.23(5) 123
10/01/03-03/31/04(7) 1.32(4)(5) 0.17(4)(5) 83
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Commencement of sale of respective class of shares
(4)Annualized
(5)Net of the following expense reimbursements (based on average net assets):
09/30/99 09/30/00 09/30/01 09/30/02(6) 09/30/03 03/31/04(4)
-------- -------- -------- ----------- -------- -----------
Growth and Income Class C+.. 0.44% 0.01% -- % -- % -- % -- %
Growth and Income Class I... -- -- -- 0.12(4) 0.37 0.08
(6)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied, the ratio of expenses to average net
assets would have remained the same.
(7)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
19
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
BALANCED ASSETS FUND
--------------------
Net gain
(loss) on Distri- Net
Net Asset Net investments Dividends butions Asset Net Assets
Value investment (both Total from from net from Total Value end of
beginning income realized and investment investment capital distri- end of Total period
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's)
- ----------------------- --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- ----------
Class A
-------
09/30/99 $18.03 $0.25 $ 3.57 $ 3.82 $(0.26) $(1.47) $(1.73) $20.12 22.11% $256,467
09/30/00 20.12 0.21 2.83 3.04 (0.22) (1.98) (2.20) 20.96 15.69 319,598
09/30/01 20.96 0.22 (5.73) (5.51) (0.21) (2.00) (2.21) 13.24 (28.35) 229,609
09/30/02(7) 13.24 0.19 (1.45) (1.26) (0.19) -- (0.19) 11.79 (9.65) 183,652
09/30/03 11.79 0.10 0.68 0.78 (0.12) -- (0.12) 12.45 6.65 175,324
10/01/03-03/31/04(8) 12.45 0.06 0.95 1.01 (0.07) -- (0.07) 13.39 8.12 173,307
Class B
-------
09/30/99 $18.01 $0.13 $ 3.57 $ 3.70 $(0.15) $(1.47) $(1.62) $20.09 21.38% $177,577
09/30/00 20.09 0.08 2.82 2.90 (0.09) (1.98) (2.07) 20.92 14.98 174,936
09/30/01 20.92 0.11 (5.70) (5.59) (0.13) (2.00) (2.13) 13.20 (28.80) 95,473
09/30/02(7) 13.20 0.10 (1.45) (1.35) (0.11) -- (0.11) 11.74 (10.29) 64,452
09/30/03 11.74 0.03 0.68 0.71 (0.04) -- (0.04) 12.41 6.07 47,496
10/01/03-03/31/04(8) 12.41 0.01 0.95 0.96 (0.03) -- (0.03) 13.34 7.71 45,182
Class C+
--------
02/02/99-09/30/99(3) $20.00 $0.08 $ 0.11 $ 0.19 $(0.08) $ -- $(0.08) $20.11 0.95% $ 8,851
09/30/00 20.11 0.08 2.82 2.90 (0.09) (1.98) (2.07) 20.94 14.95 29,506
09/30/01 20.94 0.12 (5.72) (5.60) (0.13) (2.00) (2.13) 13.21 (28.83) 24,450
09/30/02(7) 13.21 0.09 (1.43) (1.34) (0.11) -- (0.11) 11.76 (10.21) 31,894
09/30/03 11.76 0.03 0.67 0.70 (0.04) -- (0.04) 12.42 5.97 25,784
10/01/03-03/31/04(8) 12.42 0.01 0.95 0.96 (0.03) -- (0.03) 13.35 7.71 25,332
Class I
-------
11/16/01-09/30/02(3)(7) $14.29 $0.19 $(2.48) $(2.29) $(0.21) $ -- $(0.21) $11.79 (16.18)% $ 4,457
09/30/03 11.79 0.12 0.69 0.81 (0.14) -- (0.14) 12.46 6.89 4,574
10/01/03-03/31/04(8) 12.46 0.07 0.95 1.02 (0.08) -- (0.08) 13.40 8.16 3,271
Ratio of net
Ratio of investment
expenses income (loss)
to average to average Portfolio
Period Ended net assets net assets turnover
- ----------------------- ---------- ------------- ---------
09/30/99 1.45% 1.26% 123%
09/30/00 1.44 1.01 259
09/30/01 1.44 1.32 362
09/30/02(7) 1.47(6) 1.39(6) 485
09/30/03 1.49 0.86 409
10/01/03-03/31/04(8) 1.50(4) 0.88(4) 113
09/30/99 2.06% 0.64% 123%
09/30/00 2.06 0.40 259
09/30/01 2.08 0.68 362
09/30/02(7) 2.12(6) 0.73(6) 485
09/30/03 2.16 0.22 409
10/01/03-03/31/04(8) 2.19(4) 0.19(4) 113
02/02/99-09/30/99(3) 2.05%(4)(5) 0.71%(4)(5) 123%
09/30/00 2.05(5) 0.38(5) 259
09/30/01 2.05(5) 0.71(5) 362
09/30/02(7) 2.13(5)(6) 0.72(5)(6) 485
09/30/03 2.15(5) 0.22(5) 409
10/01/03-03/31/04(8) 2.17(4)(5) 0.21(4)(5) 113
11/16/01-09/30/02(3)(7) 1.33%(4)(5)(6) 1.52%(4)(5)(6) 485%
09/30/03 1.33(5) 1.02(5) 409
10/01/03-03/31/04(8) 1.33(4)(5) 1.02(4)(5) 113
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Commencement of sale of respective class of shares
(4)Annualized
(5)Net of the following expense reimbursements (based on average net assets):
09/30/99(4) 09/30/00 09/30/01 09/30/02(6) 09/30/03 03/31/04(4)
----------- -------- -------- ----------- -------- -----------
Balanced Assets Class C+... 1.41% 0.07% 0.06% -- % -- % -- %
Balanced Assets Class I.... -- -- -- 0.19(4) 0.19 0.27
(6)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied, the ratio of expenses to average net
assets would have remained the same.
(7)As disclosed in the Notes to the Financial Statements, the Fund has adopted
the provisions of the AICPA Audit and Accounting Guide of Investment
Companies and began accreting discount and amortizing premium on debt
securities. The per share affect of this change for the period ended
September 30, 2002 on investment income and realized and unrealized gain and
losses was approximately $0.01 per share for all classes of shares. The
effect of this change was to decrease the ratio of net investment income to
average net assets by 0.05% for all classes of shares. Per share data and
ratios for periods prior to September 30, 2002 have not been restated to
reflect this change in accounting policy.
(8)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
20
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
INTERNATIONAL EQUITY FUND
-------------------------
Net gain
(loss) on Distri- Net Net
Net Asset Net investments Dividends butions Asset Assets
Value investment (both Total from from net from Total Value end of
beginning income realized and investment investment capital distri- end of Total period
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's)
- ----------------------- --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- -------
Class A
-------
10/31/98 $12.46 $(0.01) $(0.01) $(0.02) $ -- $(0.22) $(0.22) $12.22 (0.09)% $28,418
10/31/99 12.22 (0.03) 2.12 2.09 -- (0.05) (0.05) 14.26 17.15 29,324
10/31/00 14.26 (0.11) 0.29 0.18 -- -- -- 14.44 1.26 49,085
10/31/01 14.44 (0.05) (4.40) (4.45) -- (1.11) (1.11) 8.88 (33.17) 24,408
11/01/01-09/30/02(8) 8.88 0.00 (1.88) (1.88) -- -- -- 7.00 (21.17) 30,896
09/30/03 7.00 0.03 1.70 1.73 -- -- -- 8.73 24.71 28,720
10/01/03-03/31/04(9) 8.73 (0.03) 1.69 1.66 0.00 -- 0.00 10.39 19.06 34,129
Class B
-------
10/31/98 $12.38 $(0.09) $ 0.00 $(0.09) $ -- $(0.22) $(0.22) $12.07 (0.67)% $47,817
10/31/99 12.07 (0.12) 2.08 1.96 -- (0.05) (0.05) 13.98 16.29 47,342
10/31/00 13.98 (0.22) 0.31 0.09 -- -- -- 14.07 0.64 48,901
10/31/01 14.07 (0.13) (4.26) (4.39) -- (1.11) (1.11) 8.57 (33.64) 26,747
11/01/01-09/30/02(8) 8.57 (0.06) (1.78) (1.84) -- -- -- 6.73 (21.47) 25,509
09/30/03 6.73 (0.03) 1.64 1.61 -- -- -- 8.34 23.92 24,799
10/01/03-03/31/04(9) 8.34 (0.06) 1.61 1.55 -- -- -- 9.89 18.59 27,253
Class C+
--------
10/31/98 $12.38 $(0.09) $ 0.00 $(0.09) $ -- $(0.22) $(0.22) $12.07 (0.67)% $ 7,982
10/31/99 12.07 (0.13) 2.10 1.97 -- (0.05) (0.05) 13.99 16.37 11,709
10/31/00 13.99 (0.21) 0.30 0.09 -- -- -- 14.08 0.64 20,367
10/31/01 14.08 (0.12) (4.28) (4.40) -- (1.11) (1.11) 8.57 (33.69) 12,949
11/01/01-09/30/02(8) 8.57 (0.06) (1.79) (1.85) -- -- -- 6.72 (21.59) 15,067
09/30/03 6.72 (0.03) 1.64 1.61 -- -- -- 8.33 23.96 14,787
10/01/03-03/31/04(9) 8.33 (0.06) 1.61 1.55 -- -- -- 9.88 18.61 16,905
Class I
-------
11/16/01-09/30/02(6)(8) $ 9.09 $ 0.01 $(2.08) $(2.07) $ -- $ -- $ -- $ 7.02 (22.77)% $15,802
09/30/03 7.02 0.03 1.72 1.75 -- -- -- 8.77 24.93 20,499
10/01/03-03/31/04(9) 8.77 (0.04) 1.71 1.67 (0.01) -- (0.01) 10.43 19.02 7,961
Ratio of net
Ratio of investment
expenses income (loss)
to average to average Portfolio
Period Ended net assets(4) net assets(4) turnover
- ----------------------- ------------- ------------- ---------
10/31/98 2.03% (0.11)% 114%
10/31/99 2.03 (0.23) 102
10/31/00 2.03(5) (0.72)(5) 89
10/31/01 2.03 (0.42) 272
11/01/01-09/30/02(8) 1.93(3)(5)(7) (0.06)(3)(5)(7) 230
09/30/03 1.90 0.35 209
10/01/03-03/31/04(9) 1.90(3) (0.57)(3) 105
10/31/98 2.68% (0.74)% 114%
10/31/99 2.68 (0.92) 102
10/31/00 2.68(5) (1.37)(5) 89
10/31/01 2.68 (1.14) 272
11/01/01-09/30/02(8) 2.56(3)(5)(7) (0.72)(3)(5)(7) 230
09/30/03 2.55 (0.41) 209
10/01/03-03/31/04(9) 2.55(3) (1.25)(3) 105
10/31/98 2.68% (0.71)% 114%
10/31/99 2.68 (0.95) 102
10/31/00 2.68(5) (1.30)(5) 89
10/31/01 2.68 (1.13) 272
11/01/01-09/30/02(8) 2.55(3)(5)(7) (0.72)(3)(5)(7) 230
09/30/03 2.55 (0.38) 209
10/01/03-03/31/04(9) 2.55(3) (1.23)(3) 105
11/16/01-09/30/02(6)(8) 1.80%(3)(5)(7) 0.16%(3)(5)(7) 230%
09/30/03 1.80 0.43 209
10/01/03-03/31/04(9) 1.80(3) (0.78)(3) 105
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Annualized
(4)Net of the following expense reimbursements (based on average net assets):
10/31/98 10/31/99 10/31/00 10/31/01 09/30/02(7) 09/30/03 03/31/04(3)
-------- -------- -------- -------- ----------- -------- -----------
International Equity Class A.... 0.45% 0.25% 0.04% 0.03% 0.08% 0.18% 0.16%
International Equity Class B.... 0.48 0.24 0.04 0.06 0.14 0.13 0.18
International Equity Class C+... 0.55 0.33 0.10 0.14 0.13 0.28 0.18
International Equity Class I.... -- -- -- -- 0.11 0.16 0.06
(5)The ratio reflects an expense cap which is net of custody credits of (0.01)%
or waiver/reimbursement if applicable.
(6)Commencement of sale of respective class of shares
(7)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied, the ratio of expenses to average net
assets would have remained the same.
(8)The Fund changed its fiscal year end from October 31 to September 30.
(9)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
21
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
VALUE FUND
----------
Net Gain
(loss) on Distri- Net Net
Net Asset Net investments Dividends butions Asset Assets
Value investment (both Total from from net from Total Value end of
beginning income realized and investment investment capital distri- end of Total period
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's)
- ----------------------- --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- -------
Class A
-------
10/31/99 $14.99 $ 0.07 $ 1.76 $ 1.83 $ -- $ -- $ -- $16.82 12.21% $58,581
10/31/00 16.82 0.04 1.68 1.72 -- (0.77) (0.77) 17.77 10.73 52,062
10/31/01 17.77 0.11 (0.83) (0.72) -- (1.95) (1.95) 15.10 (4.42) 51,150
10/31/02 15.10 0.18 0.07 0.25 (0.09) (0.63) (0.72) 14.63 1.44 50,975
10/31/03 14.63 0.29 2.05 2.34 (0.18) (0.46) (0.64) 16.33 16.59 60,701
11/01/03-03/31/04(8)(9) 16.33 0.20 1.28 1.48 (0.37) (0.45) (0.82) 16.99 9.29 72,534
Class B
-------
10/31/99 $14.81 $(0.03) $ 1.73 $ 1.70 $ -- $ -- $ -- $16.51 11.48% $95,112
10/31/00 16.51 0.06 1.51 1.57 -- (0.77) (0.77) 17.31 10.00 79,261
10/31/01 17.31 0.00 (0.80) (0.80) -- (1.95) (1.95) 14.56 (5.06) 77,667
10/31/02 14.56 0.07 0.07 0.14 (0.01) (0.63) (0.64) 14.06 0.74 78,584
10/31/03 14.06 0.19 1.98 2.17 (0.08) (0.46) (0.54) 15.69 15.94 83,935
11/01/03-03/31/04(8)(9) 15.69 0.16 1.22 1.38 (0.27) (0.45) (0.72) 16.35 9.02 80,353
Class C+
--------
10/31/99 $14.81 $(0.03) $ 1.73 $ 1.70 $ -- $ -- $ -- $16.51 11.48% $12,976
10/31/00 16.51 0.07 1.49 1.56 -- (0.77) (0.77) 17.30 9.93 14,652
10/31/01 17.30 0.00 (0.79) (0.79) -- (1.95) (1.95) 14.56 (5.01) 17,805
10/31/02 14.56 0.07 0.07 0.14 (0.01) (0.63) (0.64) 14.06 0.74 18,504
10/31/03 14.06 0.18 1.99 2.17 (0.08) (0.46) (0.54) 15.69 15.94 23,208
11/01/03-03/31/04(8)(9) 15.69 0.15 1.23 1.38 (0.27) (0.45) (0.72) 16.35 9.02 24,934
Class I
-------
11/16/01-10/31/02(6) $15.93 $ 0.19 $(0.77) $(0.58) $(0.09) $(0.63) $(0.72) $14.63 (3.83)% $ 4,726
10/31/03 14.63 0.30 2.05 2.35 (0.19) (0.46) (0.65) 16.33 16.72 6,629
11/01/03-03/31/04(8)(9) 16.33 0.21 1.29 1.50 (0.40) (0.45) (0.85) 16.98 9.59 7,889
Class Z
-------
10/31/99 $15.04 $ 0.17 $ 1.76 $ 1.93 $ -- $ -- $ -- $16.97 12.83% $ 74
10/31/00 16.97 0.13 1.69 1.82 -- (0.77) (0.77) 18.02 11.25 353
10/31/01 18.02 0.21 (0.85) (0.64) -- (1.95) (1.95) 15.43 (3.86) 487
10/31/02 15.43 0.27 0.06 0.33 (0.16) (0.63) (0.79) 14.97 1.98 360
10/31/03 14.97 0.36 2.13 2.49 (0.25) (0.46) (0.71) 16.75 17.36 4,532
11/01/03-03/31/04(8)(9) 16.75 0.23 1.34 1.57 (0.45) (0.45) (0.90) 17.42 9.40 5,476
Ratio of net
Ratio of investment
expenses income (loss)
to average to average Portfolio
Period Ended net assets net assets turnover
- ----------------------- ---------- ------------- ---------
10/31/99 1.77%(4)(5) 0.43%(4)(5) 118%
10/31/00 1.78(4)(5) 0.25(4)(5) 95
10/31/01 1.78(4)(5) 0.68(4)(5) 146
10/31/02 1.78(4) 1.15(4) 188
10/31/03 1.78(4)(7) 1.94(4)(7) 138
11/01/03-03/31/04(8)(9) 1.78(3)(4) 2.86(3)(4) 43
10/31/99 2.40%(4)(5) (0.19)%(4)(5) 118%
10/31/00 2.43(4)(5) 0.39(4)(5) 95
10/31/01 2.43(4)(5) 0.03(4)(5) 146
10/31/02 2.43(4) 0.49(4) 188
10/31/03 2.41(4)(7) 1.32(4)(7) 138
11/01/03-03/31/04(8)(9) 2.36(3)(4) 2.31(3)(4) 43
10/31/99 2.42%(4)(5) (0.21)%(4)(5) 118%
10/31/00 2.43(4)(5) 0.40(4)(5) 95
10/31/01 2.43(4)(5) 0.02(4)(5) 146
10/31/02 2.43(4) 0.49(4) 188
10/31/03 2.43(4)(7) 1.28(4)(7) 138
11/01/03-03/31/04(8)(9) 2.43(3)(4) 2.23(3)(4) 43
11/16/01-10/31/02(6) 1.68%(3)(4) 1.26%(3)(4) 188%
10/31/03 1.68(4)(7) 2.02(4)(7) 138
11/01/03-03/31/04(8)(9) 1.68(3)(4) 3.10(3)(4) 43
10/31/99 1.21%(4)(5) 0.98%(4)(5) 118%
10/31/00 1.21(4)(5) 0.72(4)(5) 95
10/31/01 1.21(4)(5) 1.26(4)(5) 146
10/31/02 1.21(4) 1.69(4) 188
10/31/03 1.21(4)(7) 2.33(4)(7) 138
11/01/03-03/31/04(8)(9) 1.21(3)(4) 3.25(3)(4) 43
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Annualized
(4)Net of the following expense reimbursements (recoupments) (based on average
net assets):
10/31/99 10/31/00 10/31/01 10/31/02 10/31/03 03/31/04(3)
-------- -------- -------- -------- -------- -----------
Value Class A.... 0.04% 0.09% 0.00% 0.01% (0.01)% (0.02)%
Value Class B.... 0.02 0.07 -- (0.02) (0.01) --
Value Class C+... 0.13 0.11 0.05 0.03 0.02 (0.02)
Value Class I.... -- -- -- 0.19(3) -- 0.00
Value Class Z.... 23.27 10.14 6.55 5.52 1.00 0.40
(5)The ratio reflects an expense cap which is net of custody credits of less
than 0.01% or waiver/reimbursements is applicable.
(6)Commencement of sale of respective class of shares
(7)Includes expense reimbursements, but excludes expense reductions. If the
expense reductions had been applied, the ratio of expenses to average net
assets would have been lower by
10/31/03
--------
Value Class A.... 0.01%
Value Class B.... 0.01
Value Class C+... 0.01
Value Class I.... 0.01
Value Class Z.... --
(8)The Fund charged its fiscal year end from October 31 to September 30
(9)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
22
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
BIOTECH/HEALTH FUND
-------------------
Net gain
(loss) on Distri- Net Net
Net Asset Net investments Dividends butions Asset Assets
Value investment (both Total from from net from Total Value end of
beginning income realized and investment investment capital distri- end of Total period
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's)
- ----------------------- --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- -------
Class A
-------
06/14/00-10/31/00(3) $12.50 $(0.02) $ 3.48 $ 3.46 $-- $ -- $ -- $15.96 27.68% $30,489
10/31/01 15.96 (0.06) (4.32) (4.38) -- (0.55) (0.55) 11.03 (27.92) 27,865
10/31/02 11.03 (0.13) (3.28) (3.41) -- -- -- 7.62 (30.92) 16,092
10/31/03 7.62 (0.11) 2.30 2.19 -- -- -- 9.81 28.74 18,924
11/01/03-03/31/04(7)(8) 9.81 (0.05) 0.81 0.76 -- -- -- 10.57 7.75 20,310
Class B
-------
06/14/00-10/31/00(3) $12.50 $(0.05) $ 3.47 $ 3.42 $-- $ -- $ -- $15.92 27.36% $23,457
10/31/01 15.92 (0.14) (4.31) (4.45) -- (0.55) (0.55) 10.92 (28.45) 25,552
10/31/02 10.92 (0.19) (3.23) (3.42) -- -- -- 7.50 (31.32) 15,757
10/31/03 7.50 (0.16) 2.25 2.09 -- -- -- 9.59 27.87 17,843
11/01/03-03/31/04(7)(8) 9.59 (0.07) 0.79 0.72 -- -- -- 10.31 7.51 18,246
Class C+
--------
06/14/00-10/31/00(3) $12.50 $(0.05) $ 3.48 $ 3.43 $-- $ -- $ -- $15.93 27.44% $20,386
10/31/01 15.93 (0.14) (4.31) (4.45) -- (0.55) (0.55) 10.93 (28.43) 23,581
10/31/02 10.93 (0.19) (3.23) (3.42) -- -- -- 7.51 (31.29) 12,448
10/31/03 7.51 (0.16) 2.26 2.10 -- -- -- 9.61 27.96 12,662
11/01/03-03/31/04(7)(8) 9.61 (0.07) 0.79 0.72 -- -- -- 10.33 7.49 13,159
Ratio of net
Ratio of investment
expenses income (loss)
to average to average Portfolio
Period Ended net assets(5) net assets(5) turnover
- ----------------------- ------------- ------------- ---------
06/14/00-10/31/00(3) 1.55%(4)(6) (0.28)%(4)(6) 112%
10/31/01 1.55(6) (0.50)(6) 333
10/31/02 1.55 (1.38) 340
10/31/03 1.55 (1.32) 236
11/01/03-03/31/04(7)(8) 1.55(4) (1.11)(4) 77
06/14/00-10/31/00(3) 2.20%(4)(6) (1.08)%(4)(6) 112%
10/31/01 2.20(6) (1.18)(6) 333
10/31/02 2.20 (2.03) 340
10/31/03 2.20 (1.97) 236
11/01/03-03/31/04(7)(8) 2.20(4) (1.76)(4) 77
06/14/00-10/31/00(3) 2.20%(4)(6) (1.07)%(4)(6) 112%
10/31/01 2.20(6) (1.17)(6) 333
10/31/02 2.20 (2.03) 340
10/31/03 2.20 (1.97) 236
11/01/03-03/31/04(7)(8) 2.20(4) (1.76)(4) 77
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Commencement of operations
(4)Annualized
(5)Net of the following expense reimbursements (based on average net assets):
10/31/00(4) 10/31/01 10/31/02 10/31/03 03/31/04(4)
----------- -------- -------- -------- -----------
Biotech/Health Fund Class A.... 0.49% 0.19% 0.20% 0.23% 0.17%
Biotech/Health Fund Class B.... 0.96 0.21 0.20 0.26 0.22
Biotech/Health Fund Class C+... 1.09 0.20 0.21 0.33 0.23
(6)The ratio reflects an expense cap which is net of custody credits of less
than 0.01%
(7)The fund changed its fiscal year end from October 31 to September 30
(8)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
23
SunAmerica Equity Funds
FINANCIAL HIGHLIGHTS -- (continued)
TAX MANAGED EQUITY FUND
Net Gain
(Loss) on Distri- Net Net
Net Asset Net investments Dividends butions Asset Assets
Value investment (both Total from from net from Total Value end of
beginning income realized and investment investment capital distri- end of Total period
Period Ended of period (loss)(1) unrealized) operations income gains butions period Return(2) (000's)
- ----------------------- --------- ---------- ------------ ---------- ---------- ------- ------- ------ --------- -------
Class A
-------
03/01/99-10/31/99(3) $12.50 $ 0.00 $ 1.15 $ 1.15 $-- $-- $-- $13.65 9.20% $25,067
10/31/00 13.65 (0.02) 0.91 0.89 -- -- -- 14.54 6.52 38,802
10/31/01 14.54 0.00 (3.50) (3.50) -- -- -- 11.04 (24.07) 28,739
10/31/02 11.04 0.01 (2.05) (2.04) -- -- -- 9.00 (18.48) 16,587
10/31/03 9.00 0.03 1.46 1.49 -- -- -- 10.49 16.56 14,877
11/01/03-03/31/04(7)(8) 10.49 0.01 0.77 0.78 -- -- -- 11.27 7.44 15,103
Class B
-------
03/01/99-10/31/99(3) $12.50 $(0.06) $ 1.14 $ 1.08 $-- $-- $-- $13.58 8.64% $27,524
10/31/00 13.58 (0.11) 0.91 0.80 -- -- -- 14.38 5.89 47,972
10/31/01 14.38 (0.08) (3.45) (3.53) -- -- -- 10.85 (24.55) 40,677
10/31/02 10.85 (0.06) (2.00) (2.06) -- -- -- 8.79 (18.99) 25,703
10/31/03 8.79 (0.03) 1.41 1.38 -- -- -- 10.17 15.70 22,694
11/01/03-03/31/04(7)(8) 10.17 (0.02) 0.75 0.73 -- -- -- 10.90 7.18 22,258
Class C+
--------
03/01/99-10/31/99(3) $12.50 $(0.06) $ 1.16 $ 1.10 $-- $-- $-- $13.60 8.80% $27,884
10/31/00 13.60 (0.11) 0.91 0.80 -- -- -- 14.40 5.88 51,348
10/31/01 14.40 (0.08) (3.46) (3.54) -- -- -- 10.86 (24.58) 43,610
10/31/02 10.86 (0.06) (2.00) (2.06) -- -- -- 8.80 (18.97) 26,430
10/31/03 8.80 (0.03) 1.42 1.39 -- -- -- 10.19 15.80 23,036
11/01/03-03/31/04(7)(8) 10.19 0.00 0.73 0.73 -- -- -- 10.92 7.16 21,860
Ratio of net
Ratio of investment
expenses income loss)
to average to average Portfolio
Period Ended net assets(5) net assets(5) turnover
- ----------------------- ------------- ------------- ---------
03/01/99-10/31/99(3) 1.45%(4)(6) (0.02)%(4)(6) 9%
10/31/00 1.45(6) (0.14)(6) 7
10/31/01 1.45(6) (0.03)(6) 19
10/31/02 1.45 0.09 16
10/31/03 1.45 0.35 13
11/01/03-03/31/04(7)(8) 1.45(4) 0.21(4) 12
03/01/99-10/31/99(3) 2.10%(4)(6) (0.74)%(4)(6) 9%
10/31/00 2.10(6) (0.79)(6) 7
10/31/01 2.10(6) (0.68)(6) 19
10/31/02 2.10 (0.56) 16
10/31/03 2.10 (0.30) 13
11/01/03-03/31/04(7)(8) 2.10(4) (0.44)(4) 12
03/01/99-10/31/99(3) 2.10%(4)(6) (0.75)%(4)(6) 9%
10/31/00 2.10(6) (0.79)(6) 7
10/31/01 2.10(6) (0.68)(6) 19
10/31/02 2.10 (0.56) 16
10/31/03 2.10 (0.30) 13
11/01/03-03/31/04(7)(8) 2.10(4) (0.44)(4) 12
- --------
(1)Calculated based upon average shares outstanding
(2)Total return is not annualized and does not reflect sales load. Total return
does include expense reimbursements and expense reductions.
(3)Commencement of operations
(4)Annualized
(5)Net of the following expense reimbursements (based on average net assets):
10/31/99(4) 10/31/00 10/31/01 10/31/02 10/31/03 03/31/04(4)
----------- -------- -------- -------- -------- -----------
Tax Managed Equity Fund Class A.... 1.07% 0.23% 0.15% 0.21% 0.26% 0.24%
Tax Managed Equity Fund Class B.... 0.84 0.22 0.15 0.20 0.23 0.24
Tax Managed Equity Fund Class C+... 0.83 0.22 0.14 0.21 0.23 0.23
(6)The ratio reflects an expense cap which is net of custody credits of less
than 0.01%
(7)The fund changed its fiscal year end from October 31 to September 30
(8)Unaudited
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
See Notes to Financial Statements
24
SunAmerica Blue Chip Growth Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 (unaudited)
Value
Security Description Shares (Note 3)
----------------------------------------------------------
COMMON STOCK -- 97.6%
Aerospace & Military Technology -- 2.0%
Honeywell International, Inc.......... 33,800 $1,144,130
United Technologies Corp.............. 12,800 1,104,640
----------
2,248,770
----------
Banks -- 1.1%
Bank of America Corp.................. 14,950 1,210,651
----------
Broadcasting & Media -- 2.9%
Interpublic Group Cos., Inc.+......... 67,600 1,039,688
Time Warner, Inc.+.................... 59,200 998,112
Walt Disney Co........................ 45,500 1,137,045
----------
3,174,845
----------
Business Services -- 0.7%
Waste Management, Inc................. 25,000 754,500
----------
Computer Software -- 3.9%
Adobe Systems, Inc.................... 25,000 985,750
Microsoft Corp........................ 135,700 3,388,429
----------
4,374,179
----------
Computers & Business Equipment -- 8.1%
Dell, Inc.+........................... 51,400 1,728,068
EMC Corp.+............................ 83,200 1,132,352
Intel Corp............................ 102,004 2,774,509
International Business Machines Corp.. 18,400 1,689,856
Lexmark International Group, Inc.+.... 18,700 1,720,400
----------
9,045,185
----------
Conglomerate -- 5.0%
3M Co................................. 16,000 1,309,920
General Electric Co................... 95,800 2,923,816
Tyco International, Ltd............... 47,900 1,372,335
----------
5,606,071
----------
Electronics -- 6.0%
Agilent Technologies, Inc.+........... 44,600 1,410,698
Applied Materials, Inc.+.............. 60,000 1,282,800
Broadcom Corp., Class A+.............. 29,600 1,159,432
KLA-Tencor Corp.+..................... 15,400 775,390
Solectron Corp.+...................... 169,100 935,123
Texas Instruments, Inc................ 35,900 1,048,998
----------
6,612,441
----------
Energy Services -- 1.6%
Smith International, Inc.+............ 32,600 1,744,426
----------
Energy Sources -- 2.6%
Burlington Resources, Inc............. 16,600 1,056,258
EOG Resources, Inc.................... 15,800 725,062
Exxon Mobil Corp...................... 26,200 1,089,658
----------
2,870,978
----------
Financial Services -- 10.2%
American Express Co................... 27,300 1,415,505
Capital One Financial Corp............ 23,400 1,765,062
Citigroup, Inc........................ 55,932 2,891,684
Goldman Sachs Group, Inc.............. 12,000 1,252,200
Merrill Lynch & Co., Inc.............. 31,550 1,879,118
Value
Security Description Shares (Note 3)
------------------------------------------------------------------
Financial Services (continued)
Morgan Stanley................................ 16,150 $ 925,395
SLM Corp...................................... 30,000 1,255,500
-----------
11,384,464
-----------
Food, Beverage & Tobacco -- 1.7%
Coca-Cola Co.................................. 26,100 1,312,830
Wm. Wrigley Jr. Co............................ 10,100 597,112
-----------
1,909,942
-----------
Health Services -- 1.9%
Aetna, Inc.................................... 13,700 1,229,164
UnitedHealth Group, Inc....................... 13,000 837,720
-----------
2,066,884
-----------
Household Products -- 2.9%
Estee Lauder Cos., Inc., Class A.............. 16,000 709,440
Gillette Co................................... 14,400 563,040
Procter & Gamble Co........................... 18,200 1,908,816
-----------
3,181,296
-----------
Insurance -- 4.0%
Anthem, Inc.+................................. 16,000 1,450,240
Berkshire Hathaway, Inc.+..................... 950 2,955,459
-----------
4,405,699
-----------
Internet Content -- 2.4%
eBay, Inc.+................................... 38,900 2,696,937
-----------
Internet Software -- 1.0%
Symantec Corp.+............................... 25,000 1,157,500
-----------
Leisure & Tourism -- 2.4%
Carnival Corp................................. 40,400 1,814,364
International Game Technology................. 20,000 899,200
-----------
2,713,564
-----------
Machinery -- 1.2%
Caterpillar, Inc.+............................ 8,500 672,095
Ingersoll-Rand Co., Ltd., Class A............. 10,000 676,500
-----------
1,348,595
-----------
Medical Products -- 4.1%
Becton Dickinson & Co......................... 22,000 1,066,560
Guidant Corp.................................. 10,000 633,700
Johnson & Johnson............................. 31,900 1,617,968
St. Jude Medical, Inc.+....................... 17,300 1,247,330
-----------
4,565,558
-----------
Pharmaceuticals -- 12.1%
Allergan, Inc................................. 13,000 1,094,080
Amgen, Inc.+.................................. 27,611 1,606,132
Biogen Idec, Inc.+............................ 25,000 1,390,000
Caremark Rx, Inc.+............................ 40,000 1,330,000
Genentech, Inc.+.............................. 19,600 2,074,072
Merck & Co., Inc.............................. 18,900 835,191
Pfizer, Inc................................... 107,845 3,779,967
Teva Pharmaceutical Industries, Ltd. Sp. ADR.. 20,200 1,280,882
-----------
13,390,324
-----------
Restaurants -- 0.6%
McDonald's Corp............................... 24,950 712,822
-----------
25
SunAmerica Blue Chip Growth Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Value
Security Description Shares (Note 3)
-------------------------------------------------------------
COMMON STOCK (continued)
Retail Stores -- 7.6%
Home Depot, Inc........................ 52,700 $ 1,968,872
Ross Stores, Inc....................... 29,600 906,056
Sharper Image Corp.+................... 40,000 1,303,200
Target Corp............................ 29,600 1,333,184
Wal-Mart Stores, Inc................... 35,000 2,089,150
Williams-Sonoma, Inc.+................. 25,400 868,680
------------
8,469,142
------------
Telecommunications -- 11.0%
Cisco Systems, Inc.+................... 118,000 2,775,360
Corning, Inc.+......................... 60,000 670,800
Motorola, Inc.......................... 97,200 1,710,720
Nextel Communications, Inc., Class A+.. 71,200 1,760,776
Nokia Corp. Sponsored ADR.............. 55,800 1,131,624
QUALCOMM, Inc.......................... 25,400 1,687,068
Verizon Communications, Inc............ 29,600 1,081,584
Vodafone Group, PLC Sp. ADR............ 56,400 1,347,960
------------
12,165,892
------------
Transportation -- 0.6%
United Parcel Service, Inc., Class B... 10,100 705,384
------------
Total Investment Securities -- 97.6%
(cost $100,136,815)................... 108,516,049
------------
Principal Value
Security Description Amount (Note 3)
----------------------------------------------------------------
REPURCHASE AGREEMENTS -- 2.6%
State Street Bank & Trust Co.
Joint Repurchase Agreement
(See Note 3)........................ $ 836,000 $ 836,000
UBS Warburg, LLC
Joint Repurchase Agreement
(See Note 3)........................ 2,000,000 2,000,000
------------
Total Repurchase Agreements
(cost $2,836,000)................... 2,836,000
------------
TOTAL INVESTMENTS --
(cost $102,972,815) (See Note 6) 100.2% 111,352,049
Liabilities in excess of other assets.. (0.2) (190,967)
---------- ------------
NET ASSETS -- 100.00% $111,161,082
========== ============
- --------
+ Non-income producing security
ADR --American Depository Receipt
See Notes to Financial Statements
26
SunAmerica Growth Opportunities Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
----------------------------------------------------------
COMMON STOCK -- 93.1%
Banks -- 2.0%
Dime Community Bancshares Corp........ 45,000 $ 915,750
Franklin Bank Corp.+.................. 60,000 1,115,400
Signature Bank+....................... 37,000 773,300
-----------
2,804,450
-----------
Broadcasting & Media -- 1.4%
Cumulus Media, Inc.+.................. 25,000 499,750
Emmis Communications Corp.+........... 20,000 476,200
Westwood One, Inc.+................... 35,000 1,030,750
-----------
2,006,700
-----------
Business Services -- 4.7%
Chicago Bridge & Iron Co. NV.......... 50,000 1,391,500
Fastenal Co........................... 60,000 3,221,400
Herman Miller, Inc.................... 30,000 798,900
Tech Data Corp.+...................... 30,000 1,228,200
-----------
6,640,000
-----------
Communication Equipment -- 3.3%
AudioCodes, Ltd.+..................... 50,000 580,000
Intersil Corp., Class A............... 50,000 1,114,500
LSI Logic Corp.+...................... 150,000 1,401,000
Tekelec Inc.+......................... 100,000 1,659,000
-----------
4,754,500
-----------
Computer Software -- 9.6%
Ascential Software Corp.+............. 75,000 1,644,000
Cognos, Inc.+......................... 65,000 2,018,900
DST Systems, Inc.+.................... 60,000 2,721,000
FileNET Corp.+........................ 100,000 2,665,000
Fiserv, Inc.+......................... 30,000 1,073,100
FutureLink Corp.+..................... 11,714 1
Keane, Inc.+.......................... 50,000 787,000
Lawson Software, Inc.+................ 100,000 830,000
Parametric Technology Corp.+.......... 150,000 678,000
Siebel Systems, Inc.+................. 100,000 1,151,000
-----------
13,568,001
-----------
Computers & Business Equipment -- 1.0%
Avocent Corp.+........................ 40,000 1,471,600
-----------
Electronics -- 13.1%
AMETEK, Inc........................... 60,000 1,538,400
AMIS Holdings, Inc.+.................. 7,000 113,610
Applied Micro Circuits Corp.+......... 200,000 1,150,000
Celestica, Inc.+...................... 50,000 820,000
Cymer, Inc.+.......................... 70,000 2,702,700
Electro Scientific Industries, Inc.+.. 50,000 1,177,000
Flextronics International, Ltd.+...... 100,000 1,722,000
Lam Research Corp.+................... 90,000 2,268,900
MEMC Electronic Materials, Inc.+...... 75,000 686,250
OmnVision Technologies, Inc.+......... 70,000 1,911,700
ON Semiconductor Corp.+............... 100,000 754,000
Semtech Corp.+........................ 75,000 1,712,250
Sigmatel, Inc.+....................... 3,000 67,350
Solectron Corp.+...................... 100,000 553,000
Tessera Technologies, Inc.+........... 3,000 54,900
Vitesse Semiconductor Corp.+.......... 200,000 1,418,000
-----------
18,650,060
-----------
Value
Security Description Shares (Note 3)
------------------------------------------------------------
Energy Services -- 2.8%
Global Industries, Ltd.+............... 100,000 $ 585,000
Nabors Industries, Ltd.+............... 34,200 1,564,650
Patterson-UTI Energy, Inc.+............ 50,000 1,770,500
-----------
3,920,150
-----------
Energy Sources -- 0.0%
Cross Timbers Royalty Trust............ 369 10,461
-----------
Entertainment Products -- 0.8%
Marvel Enterprises, Inc.+.............. 60,000 1,151,400
-----------
Financial Services -- 5.3%
Nelnet, Inc., Class A+................. 63,000 1,600,200
Piper Jaffray Cos.+.................... 60,000 3,249,000
Providian Financial Corp.+............. 200,000 2,620,000
-----------
7,469,200
-----------
Food, Beverage & Tobacco -- 0.4%
SunOpta, Inc.+......................... 60,000 593,400
-----------
Health Services -- 4.0%
Accredo Health, Inc.+.................. 80,000 3,048,000
Centene Corp.+......................... 30,000 917,700
Covance, Inc.+......................... 50,000 1,722,000
-----------
5,687,700
-----------
Insurance -- 1.8%
Montpelier Re Holdings, Ltd............ 25,000 931,000
Platinum Underwriters Holdings, Ltd.... 45,000 1,442,250
Scottish Annuity & Life Holdings, Ltd.. 7,000 169,330
-----------
2,542,580
-----------
Internet Content -- 2.2%
Cnet Networks, Inc.+................... 100,000 1,033,000
Digital Insight Corp.+................. 100,000 2,072,000
-----------
3,105,000
-----------
Internet Software -- 8.6%
BEA Systems, Inc.+..................... 100,000 1,276,000
Kintera, Inc.+......................... 75,000 1,250,250
Secure Computing Corp.+................ 200,000 3,270,000
SupportSoft, Inc.+..................... 100,000 1,101,000
Symantec Corp.+........................ 80,000 3,704,000
Watchguard Technologies, Inc.+......... 200,000 1,564,000
-----------
12,165,250
-----------
Leisure & Tourism -- 5.7%
Argosy Gaming Co.+..................... 26,000 924,300
GTECH Holdings Corp.................... 30,000 1,774,200
Mandalay Resort Group.................. 40,000 2,290,400
Penn National Gaming, Inc.+............ 30,000 863,100
Royal Caribbean Cruises, Ltd........... 30,000 1,323,000
Scientific Games Corp.+................ 50,000 936,000
-----------
8,111,000
-----------
Machinery -- 5.8%
Cooper Industries, Ltd., Class A....... 40,000 2,287,200
Graco, Inc............................. 45,000 1,309,950
Parker-Hannifin Corp................... 30,000 1,695,000
27
SunAmerica Growth Opportunities Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Value
Security Description Shares (Note 3)
--------------------------------------------------------------
COMMON STOCK (continued)
Machinery (continued)
Terex Corp.+............................. 30,000 $ 1,109,100
Toro Co.................................. 30,000 1,860,000
-----------
8,261,250
-----------
Medical Products -- 1.5%
Cypress Bioscience, Inc.+................ 50,000 571,000
Encore Medical Corp.+.................... 50,000 400,500
Protein Design Labs, Inc.+............... 50,000 1,191,000
-----------
2,162,500
-----------
Metals & Mining -- 0.7%
Worthington Industries, Inc.............. 50,000 958,500
-----------
Pharmaceuticals -- 9.9%
Abgenix, Inc.+........................... 50,000 664,500
Caremark Rx, Inc.+....................... 60,000 1,995,000
Cephalon, Inc.+.......................... 72,000 4,126,320
Integra Lifesciences Holdings Corp.+..... 82,900 2,538,398
Medicines Co.+........................... 50,000 1,610,500
NeighborCare, Inc.+...................... 60,000 1,455,000
Watson Pharmaceuticals, Inc.+............ 40,000 1,711,600
-----------
14,101,318
-----------
Restaurants -- 2.2%
Applebees International, Inc............. 40,000 1,654,000
Landry's Restaurants, Inc................ 50,000 1,491,500
-----------
3,145,500
-----------
Retail Stores -- 1.7%
Foot Locker, Inc......................... 50,000 1,290,000
HON INDUSTRIES, Inc...................... 30,000 1,114,800
-----------
2,404,800
-----------
Telecommunications -- 2.7%
Alvarion, Ltd.+.......................... 100,000 1,269,000
Arris Group, Inc.+....................... 50,000 460,000
EchoStar Communications Corp., Class A+.. 63,950 2,094,363
-----------
3,823,363
-----------
Shares/
Principal Value
Security Description Amount (Note 3)
-----------------------------------------------------------------
Transportation -- 1.9%
C.H. Robinson Worldwide, Inc........... 30,000 $ 1,245,000
Hornbeck Offshore Services, Inc.+...... 110,000 1,452,000
------------
2,697,000
------------
Total Common Stock
(cost $118,199,279)................... 132,205,683
------------
EXCHANGE-TRADED FUNDS -- 5.5%
Financial Services -- 5.5%
iShares Russell 2000 Growth Index Fund
(cost $7,731,250)..................... 125,000 7,812,500
------------
Total Investment Securities -- 98.6%
(cost $125,930,529)................... 140,018,183
------------
REPURCHASE AGREEMENTS -- 1.2%
State Street Bank & Trust Co.
Joint Repurchase Agreement
(see Note 3)
(cost $1,721,000)..................... $1,721,000 1,721,000
------------
TOTAL INVESTMENTS --
(cost $127,651,529) (See Note 6)...... 99.8% 141,739,183
Other assets less liabilities............ 0.2 291,036
---------- ------------
NET ASSETS -- 100.00% $142,030,219
========== ============
- --------
+ Non-income producing security
See Notes to Financial Statements
28
SunAmerica New Century Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
-------------------------------------------------------------
COMMON STOCK -- 86.6%
Banks -- 3.3%
Hibernia Corp., Class A.................. 72,800 $1,710,072
Wachovia Corp............................ 35,700 1,677,900
----------
3,387,972
----------
Broadcasting & Media -- 2.0%
DIRECTV Group, Inc.+..................... 52,514 807,665
Fox Entertainment Group, Inc., Class A+.. 23,000 623,300
Radio One, Inc.+......................... 30,900 571,650
----------
2,002,615
----------
Business Services -- 6.2%
Fastenal Co.............................. 26,800 1,438,892
Orbitz, Inc., Class A+................... 17,700 421,437
Paychex, Inc............................. 45,500 1,619,800
Stericycle, Inc.+........................ 26,200 1,253,932
Waste Connections, Inc.+................. 38,500 1,532,300
----------
6,266,361
----------
Communication Equipment -- 4.7%
Foundry Networks, Inc.+.................. 72,700 1,248,259
Juniper Networks, Inc.+.................. 60,700 1,578,807
Marvell Technology Group, Ltd.+.......... 43,500 1,959,675
----------
4,786,741
----------
Computer Software -- 3.5%
CACI International, Inc., Class A+....... 33,300 1,431,900
Cognos, Inc.+............................ 35,700 1,108,842
Manhattan Associates, Inc.+.............. 38,000 1,056,400
----------
3,597,142
----------
Computers & Business Equipment -- 1.6%
EMC Corp.+............................... 116,800 1,589,648
----------
Education -- 2.3%
Apollo Group, Inc., Class A+............. 26,650 2,294,832
----------
Electronics -- 2.3%
Rockwell Automation, Inc................. 66,800 2,315,956
----------
Energy Services -- 4.3%
BJ Services Co.+......................... 35,500 1,536,085
Patterson-UTI Energy, Inc.+.............. 16,700 591,347
Pride International, Inc.+............... 37,400 638,044
Smith International, Inc.+............... 29,700 1,589,247
----------
4,354,723
----------
Energy Sources -- 2.4%
Burlington Resources, Inc................ 22,900 1,457,127
EOG Resources, Inc....................... 20,400 936,156
----------
2,393,283
----------
Financial Services -- 9.4%
Ameritrade Holding Corp.+................ 122,100 1,880,340
Goldman Sachs Group, Inc................. 22,900 2,389,615
Knight Trading Group, Inc.+.............. 54,100 684,906
Lehman Brothers Holdings, Inc............ 21,300 1,765,131
Providian Financial Corp.+............... 107,100 1,403,010
SLM Corp................................. 35,000 1,464,750
----------
9,587,752
----------
Value
Security Description Shares (Note 3)
------------------------------------------------------------------
Health Services -- 2.3%
Centene Corp.+................................ 36,000 $1,101,240
Select Medical Corp........................... 75,700 1,264,190
----------
2,365,430
----------
Household Products -- 1.2%
Yankee Candle, Inc.+.......................... 43,000 1,185,940
----------
Internet Content -- 2.8%
Yahoo!, Inc.+................................. 58,600 2,847,374
----------
Internet Software -- 4.1%
BEA Systems, Inc.+............................ 42,900 547,404
Symantec Corp.+............................... 53,400 2,472,420
VeriSign, Inc.+............................... 67,800 1,124,802
----------
4,144,626
----------
Leisure & Tourism -- 2.7%
International Speedway Corp., Class A......... 44,900 2,110,300
JetBlue Airways Corp.+........................ 24,875 629,089
----------
2,739,389
----------
Machinery -- 1.5%
Cummins, Inc.................................. 25,900 1,513,855
----------
Medical Products -- 7.3%
Boston Scientific Corp.+...................... 33,200 1,407,016
Cytyc Corp.+.................................. 66,400 1,477,400
Millennium Pharmaceuticals, Inc.+............. 65,600 1,108,640
Neurocrine Biosciences, Inc.+................. 16,900 998,790
St. Jude Medical, Inc.+....................... 33,300 2,400,930
----------
7,392,776
----------
Metals & Mining -- 1.2%
Cleveland-Cliffs, Inc.+....................... 19,000 1,243,170
----------
Pharmaceuticals -- 5.2%
Amgen, Inc.+.................................. 17,400 1,012,158
Cubist Pharmaceuticals, Inc.+................. 63,300 582,360
Gilead Sciences, Inc.+........................ 27,700 1,544,829
Teva Pharmaceutical Industries, Ltd. Sp. ADR.. 33,600 2,130,576
----------
5,269,923
----------
Restaurants -- 2.7%
Applebees International, Inc.................. 29,800 1,232,230
Ruby Tuesday, Inc............................. 45,700 1,469,255
----------
2,701,485
----------
Retail Stores -- 6.4%
Amazon.com, Inc.+............................. 38,800 1,679,264
Chico's FAS, Inc.+............................ 32,800 1,521,920
Coach, Inc.+.................................. 47,600 1,951,124
Williams-Sonoma, Inc.+........................ 39,700 1,357,740
----------
6,510,048
----------
Telecommunications -- 3.4%
Corning, Inc.+................................ 119,900 1,340,482
EchoStar Communications Corp.,
Class A+..................................... 200 6,550
Nextel Communications, Inc., Class A+......... 86,800 2,146,564
----------
3,493,596
----------
29
SunAmerica New Century Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Value
Security Description Shares (Note 3)
----------------------------------------------------------
COMMON STOCK (continued)
Transportation -- 3.8%
Heartland Express, Inc................ 45,713 $ 1,041,342
J.B. Transport Services, Inc.+........ 33,200 935,244
United Parcel Service, Inc., Class B.. 27,300 1,906,632
-----------
3,883,218
-----------
Total Common Stock
(cost $68,401,758)................... 87,867,855
-----------
PREFERRED STOCK -- 0.2%
Broadcasting & Media -- 0.2%
News Corp., Ltd. Sponsored ADR
(cost $170,020)...................... 5,842 185,250
-----------
Total Investment Securities -- 86.8%
(cost $68,571,778)................... 88,053,105
-----------
Principal Value
Security Description Amount (Note 3)
---------------------------------------------------------------
REPURCHASE AGREEMENTS -- 13.6%
State Street Bank & Trust Co.
Joint Repurchase Agreement
(See Note 3).......................... $5,762,000 $ 5,762,000
UBS Warburg, LLC
Joint Repurchase Agreement
(See Note 3).......................... 8,000,000 8,000,000
------------
Total Repurchase Agreements
(cost $13,762,000).................. 13,762,000
------------
TOTAL INVESTMENTS --
(cost $82,333,778) (See Note 6) 100.4% 101,815,105
Liabilities in excess of other assets.. (0.4) (415,817)
---------- ------------
NET ASSETS -- 100.00% $101,399,288
========== ============
- --------
+ Non-income producing security
ADR --American Depository receipt
See Notes to Financial Statements
30
SunAmerica Growth and Income Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
-----------------------------------------------------------
COMMON STOCK -- 99.1%
Aerospace & Military Technology -- 3.0%
Boeing Co............................. 33,500 $ 1,375,845
Honeywell International, Inc.......... 53,700 1,817,745
United Technologies Corp.............. 27,900 2,407,770
-----------
5,601,360
-----------
Banks -- 3.1%
Bank of America Corp.................. 22,200 1,797,756
Mellon Financial Corp................. 65,300 2,043,237
U.S. Bancorp.......................... 73,500 2,032,275
-----------
5,873,268
-----------
Broadcasting & Media -- 3.0%
Interpublic Group Cos., Inc.+......... 107,400 1,651,812
Time Warner, Inc.+.................... 98,500 1,660,710
Walt Disney Co........................ 92,700 2,316,573
-----------
5,629,095
-----------
Business Services -- 1.1%
Waste Management, Inc................. 70,000 2,112,600
-----------
Chemicals -- 1.1%
Monsanto Co........................... 56,800 2,082,856
-----------
Computer Software -- 3.5%
Adobe Systems, Inc.................... 39,200 1,545,656
Microsoft Corp........................ 201,400 5,028,958
-----------
6,574,614
-----------
Computers & Business Equipment -- 7.5%
Dell, Inc.+........................... 55,200 1,855,824
EMC Corp.+............................ 112,600 1,532,486
Intel Corp............................ 105,000 2,856,000
International Business Machines Corp.. 38,000 3,489,920
Lexmark International Group, Inc.+.... 20,900 1,922,800
Xerox Corp.+.......................... 175,000 2,549,750
-----------
14,206,780
-----------
Conglomerate -- 5.2%
3M Co................................. 24,600 2,014,002
General Electric Co................... 188,300 5,746,916
Tyco International, Ltd............... 70,600 2,022,690
-----------
9,783,608
-----------
Electronics -- 3.4%
Agilent Technologies, Inc.+........... 37,900 1,198,777
Applied Materials, Inc.+.............. 65,000 1,389,700
Broadcom Corp., Class A+.............. 22,300 873,491
Solectron Corp.+...................... 223,800 1,237,614
Texas Instruments, Inc................ 57,100 1,668,462
-----------
6,368,044
-----------
Energy Services -- 1.4%
Smith International, Inc.+............ 50,000 2,675,500
-----------
Energy Sources -- 4.9%
Burlington Resources, Inc............. 25,900 1,648,017
EOG Resources, Inc.................... 26,400 1,211,496
Exxon Mobil Corp...................... 112,200 4,666,398
Marathon Oil Corp..................... 49,200 1,656,564
-----------
9,182,475
-----------
Financial Services -- 13.7%
American Express Co................. 46,300 $ 2,400,655
Capital One Financial Corp.......... 31,700 2,391,131
CIT Group, Inc...................... 66,300 2,522,715
Citigroup, Inc...................... 96,100 4,968,370
Goldman Sachs Group, Inc............ 20,100 2,097,435
J.P. Morgan Chase & Co.............. 86,800 3,641,260
Merrill Lynch & Co., Inc............ 51,400 3,061,384
Morgan Stanley...................... 27,800 1,592,940
SLM Corp............................ 49,000 2,050,650
Wells Fargo & Co.................... 19,500 1,105,065
-----------
25,831,605
-----------
Food, Beverage & Tobacco -- 3.8%
Altria Group, Inc................... 56,400 3,070,980
Coca-Cola Co........................ 49,800 2,504,940
Wm. Wrigley Jr. Co.................. 26,800 1,584,416
-----------
7,160,336
-----------
Forest Products -- 0.9%
MeadWestvaco Corp................... 58,600 1,657,794
-----------
Health Services -- 1.0%
Aetna, Inc.......................... 20,700 1,857,204
-----------
Household Products -- 3.9%
Estee Lauder Cos., Inc., Class A.... 59,300 2,629,362
Gillette Co......................... 44,800 1,751,680
Procter & Gamble Co................. 29,300 3,072,984
-----------
7,454,026
-----------
Insurance -- 3.5%
Anthem, Inc.+....................... 28,600 2,592,304
Berkshire Hathaway, Inc.+........... 1,300 4,044,313
-----------
6,636,617
-----------
Internet Software -- 1.0%
Symantec Corp.+..................... 40,000 1,852,000
-----------
Leisure & Tourism -- 1.2%
Carnival Corp....................... 52,400 2,353,284
-----------
Machinery -- 1.6%
Caterpillar, Inc.+.................. 13,400 1,059,538
Ingersoll-Rand Co., Ltd.,
Class A............................ 29,400 1,988,910
-----------
3,048,448
-----------
Medical Products -- 4.0%
Becton Dickinson & Co............... 34,000 1,648,320
Guidant Corp........................ 19,600 1,242,052
Johnson & Johnson................... 52,200 2,647,584
St. Jude Medical, Inc.+............. 29,500 2,126,950
-----------
7,664,906
-----------
Metals & Mining -- 0.7%
Phelps Dodge Corp.+................. 16,700 1,363,722
-----------
Pharmaceuticals -- 8.7%
Allergan, Inc....................... 17,600 1,481,216
Amgen, Inc.+........................ 29,300 1,704,381
Caremark Rx, Inc.+.................. 58,800 1,955,100
Genentech, Inc.+.................... 32,700 3,460,314
Merck & Co., Inc.................... 32,750 1,447,223
31
SunAmerica Growth and Income Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Value
Security Description Shares (Note 3)
-----------------------------------------------------------------------
COMMON STOCK (continued)
Pharmaceuticals (continued)
Pfizer, Inc.................................. 122,750 $ 4,302,387
Teva Pharmaceutical Industries, Ltd. Sp. ADR. 33,900 2,149,599
-----------
16,500,220
-----------
Restaurants -- 1.0%
McDonald's Corp.............................. 65,500 1,871,335
-----------
Retail Stores -- 7.2%
Federated Department Stores, Inc............. 39,200 2,118,760
Home Depot, Inc.............................. 66,000 2,465,760
Ross Stores, Inc............................. 49,200 1,506,012
Target Corp.................................. 44,800 2,017,792
Wal-Mart Stores, Inc......................... 68,900 4,112,641
Williams-Sonoma, Inc.+....................... 40,300 1,378,260
-----------
13,599,225
-----------
Telecommunications -- 8.3%
Cisco Systems, Inc.+......................... 114,300 2,688,336
Corning, Inc.+............................... 98,000 1,095,640
Motorola, Inc................................ 143,500 2,525,600
Nextel Communications, Inc.,
Class A+.................................... 102,800 2,542,244
QUALCOMM, Inc................................ 35,800 2,377,836
Verizon Communications, Inc.................. 80,500 2,941,470
Vodafone Group, PLC Sp. ADR.................. 66,400 1,586,960
-----------
15,758,086
-----------
Transportation -- 0.6%
United Parcel Service, Inc., Class B......... 15,400 $ 1,075,536
-----------
Utilities -- 0.8%
Southern Co.................................. 51,700 1,576,850
-----------
Total Investment Securities -- 99.1%
(cost $171,227,737)......................... 187,351,394
-----------
REPURCHASE AGREEMENTS -- 0.1%
State Street Bank & Trust Co.
Joint Repurchase Agreement
( See Note 3)
(cost $144,000)............................. $144,000 144,000
-----------
TOTAL INVESTMENTS --
(cost $171,371,737) (See Note 6)............ 99.2% 187,495,394
Other assets less liabilities.................. 0.8 1,566,420
-------- -----------
NET ASSETS -- 100.00% $189,061,814
======== ============
- --------
+ Non-income producing securities
ADR --American Depository Receipt
See Notes to Financial Statements
32
SunAmerica Balanced Assets Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
---------------------------------------------------------------
COMMON STOCK -- 64.0%
Aerospace & Military Technology -- 2.2%
Boeing Co............................... 39,000 $ 1,601,730
Honeywell International, Inc............ 54,000 1,827,900
United Technologies Corp................ 24,400 2,105,720
-----------
5,535,350
-----------
Banks -- 2.1%
Bank of America Corp.................... 20,900 1,692,482
Mellon Financial Corp................... 56,200 1,758,498
U.S. Bancorp............................ 58,900 1,628,585
-----------
5,079,565
-----------
Broadcasting & Media -- 1.9%
Interpublic Group Cos., Inc.+........... 98,200 1,510,316
Time Warner, Inc.+...................... 88,400 1,490,424
Walt Disney Co.......................... 67,400 1,684,326
-----------
4,685,066
-----------
Business Services -- 0.7%
Waste Management, Inc................... 60,000 1,810,800
-----------
Chemicals -- 1.2%
Dow Chemical Co......................... 29,500 1,188,260
Monsanto Co............................. 47,600 1,745,492
-----------
2,933,752
-----------
Computer Software -- 2.1%
Adobe Systems, Inc...................... 29,500 1,163,185
Microsoft Corp.......................... 165,100 4,122,547
-----------
5,285,732
-----------
Computers & Business Equipment -- 4.8%
Dell, Inc.+............................. 50,100 1,684,362
EMC Corp.+.............................. 88,800 1,208,568
Intel Corp.............................. 83,900 2,282,080
International Business Machines Corp.... 30,800 2,828,672
Lexmark International Group, Inc.+...... 17,700 1,628,400
Xerox Corp.+............................ 150,000 2,185,500
-----------
11,817,582
-----------
Conglomerate -- 3.5%
3M Co................................... 21,900 1,792,953
General Electric Co..................... 164,300 5,014,436
Tyco International, Ltd................. 62,500 1,790,625
-----------
8,598,014
-----------
Electronics -- 2.2%
Agilent Technologies, Inc.+............. 36,500 1,154,495
Applied Materials, Inc.+................ 50,000 1,069,000
Broadcom Corp., Class A+................ 19,600 767,732
Solectron Corp.+........................ 196,400 1,086,092
Texas Instruments, Inc.................. 43,500 1,271,070
-----------
5,348,389
-----------
Energy Services -- 1.0%
Smith International, Inc.+.............. 45,000 2,407,950
-----------
Energy Sources -- 3.1%
Burlington Resources, Inc............... 18,600 1,183,518
EOG Resources, Inc...................... 22,000 1,009,580
Energy Sources
Exxon Mobil Corp........................ 99,300 $ 4,129,887
Marathon Oil Corp....................... 39,300 1,323,231
-----------
7,646,216
-----------
Financial Services -- 8.7%
American Express Co..................... 36,700 1,902,895
Capital One Financial Corp.............. 30,000 2,262,900
CIT Group, Inc.......................... 54,300 2,066,115
Citigroup, Inc.......................... 75,800 3,918,860
Goldman Sachs Group, Inc................ 17,600 1,836,560
J.P. Morgan Chase & Co.................. 68,200 2,860,990
Merrill Lynch & Co., Inc................ 42,700 2,543,212
Morgan Stanley.......................... 20,850 1,194,705
SLM Corp................................ 39,300 1,644,705
Wells Fargo & Co........................ 22,300 1,263,741
-----------
21,494,683
-----------
Food, Beverage & Tobacco -- 2.6%
Altria Group, Inc....................... 42,300 2,303,235
Coca-Cola Co............................ 58,000 2,917,400
Wm. Wrigley Jr. Co...................... 19,600 1,158,752
-----------
6,379,387
-----------
Forest Products -- 0.6%
MeadWestvaco Corp....................... 52,700 1,490,883
-----------
Health Services -- 0.6%
Aetna, Inc.............................. 17,000 1,525,240
-----------
Household Products -- 2.5%
Estee Lauder Cos., Inc., Class A........ 49,400 2,190,396
Gillette Co............................. 39,300 1,536,630
Procter & Gamble Co..................... 22,800 2,391,264
-----------
6,118,290
-----------
Insurance -- 2.1%
Anthem, Inc.+........................... 24,300 2,202,552
Berkshire Hathaway, Inc.+............... 1,000 3,111,010
-----------
5,313,562
-----------
Internet Software -- 0.7%
Symantec Corp.+......................... 35,000 1,620,500
-----------
Leisure & Tourism -- 0.8%
Carnival Corp........................... 44,400 1,994,004
-----------
Machinery -- 1.0%
Caterpillar, Inc.+...................... 9,800 774,886
Ingersoll-Rand Co., Ltd., Class A. 24,500 1,657,425
-----------
2,432,311
-----------
Medical Products -- 2.5%
Becton Dickinson & Co................... 29,500 1,430,160
Guidant Corp............................ 14,700 931,539
Johnson & Johnson....................... 46,900 2,378,768
St. Jude Medical, Inc.+................. 21,500 1,550,150
-----------
6,290,617
-----------
Metals & Mining -- 0.5%
Phelps Dodge Corp.+..................... 14,700 1,200,402
-----------
33
SunAmerica Balanced Assets Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Shares/
Principal Value
Security Description Amount (Note 3)
----------------------------------------------------------------------
COMMON STOCK (continued)
Pharmaceuticals -- 5.4%
Allergan, Inc................................ 14,700 $ 1,237,152
Amgen, Inc.+................................. 23,000 1,337,910
Caremark Rx, Inc.+........................... 49,100 1,632,575
Genentech, Inc.+............................. 27,500 2,910,050
Merck & Co., Inc............................. 26,500 1,171,035
Pfizer, Inc.................................. 102,660 3,598,233
Teva Pharmaceutical Industries, Ltd. Sp. ADR. 23,800 1,509,158
------------
13,396,113
------------
Restaurants -- 0.7%
McDonald's Corp.............................. 61,500 1,757,055
Retail Stores -- 4.5%
Federated Department Stores, Inc............. 29,500 1,594,475
Home Depot, Inc.............................. 49,500 1,849,320
Ross Stores, Inc............................. 39,300 1,202,973
Target Corp.................................. 39,300 1,770,072
Wal-Mart Stores, Inc......................... 59,500 3,551,555
Williams-Sonoma, Inc.+....................... 34,400 1,176,480
------------
11,144,875
------------
Telecommunications -- 5.0%
Cisco Systems, Inc.+......................... 97,300 2,288,496
Corning, Inc.+............................... 78,500 877,630
Motorola, Inc................................ 113,300 1,994,080
Nextel Communications, Inc., Class A+........ 86,400 2,136,672
QUALCOMM, Inc................................ 29,400 1,952,748
Verizon Communications, Inc.................. 54,000 1,973,160
Vodafone Group, PLC Sp. ADR.................. 50,100 1,197,390
------------
12,420,176
------------
Transportation -- 0.4%
United Parcel Service, Inc., Class B......... 14,200 991,728
------------
Utilities -- 0.6%
Southern Co.................................. 44,900 1,369,450
------------
Total Common Stock
(cost $144,343,740)......................... 158,087,692
------------
CORPORATE BONDS -- 14.3%
Aerospace & Military Technology -- 0.3%
Goodrich Corp.
6.45% due 12/15/07.......................... $238,000 266,439
Northrop Grumman Corp.
7.13% due 2/15/11........................... 106,000 125,293
Raytheon Co.
4.85% due 1/15/11........................... 238,000 247,485
------------
639,217
------------
Automotive -- 0.4%
Ford Motor Co.
6.63% due 10/01/28.......................... 555,000 510,182
General Motors Corp.
7.20% due 1/15/11........................... 238,000 260,832
General Motors Corp.
8.25% due 7/15/23........................... 232,000 258,960
------------
1,029,974
------------
Banks -- 0.5%
Bank of America Corp.
Series J
1.27% due 2/17/09(1)........................ $222,000 $ 222,143
Key Bank NA
4.10% due 6/30/05........................... 238,000 245,846
Key Bank NA
7.00% due 2/01/11........................... 89,000 104,126
PNC Funding Corp.
5.75% due 8/01/06........................... 202,000 218,088
Washington Mutual Banks
5.50% due 1/15/13........................... 238,000 253,485
Westpac Capital Trust IV
5.26% due 12/29/49*......................... 277,000 277,000
------------
1,320,688
------------
Broadcasting & Media -- 1.0%
AOL Time Warner
6.13% due 4/15/06........................... 238,000 256,425
Charter Communications
Holdings, LLC
11.13% due 1/15/11.......................... 260,000 227,500
Comcast Cable Commerce, Inc.
6.88% due 6/15/09........................... 238,000 271,453
CSC Holdings, Inc.
7.88% due 2/15/18........................... 600,000 643,500
Insight Communications Co., Inc.
12.25% due 2/15/11(2)....................... 225,000 190,125
Liberty Media Corp.
3.50% due 9/25/06........................... 238,000 242,357
News America, Inc.
7.63% due 11/30/28.......................... 238,000 282,914
Time Warner, Inc.
6.63% due 5/15/29........................... 238,000 248,688
Young Broadcasting, Inc.
10.00% due 3/01/11.......................... 150,000 160,500
------------
2,523,462
------------
Business Services -- 0.2%
Allied Waste North America, Inc.
5.75% due 2/15/11*.......................... 100,000 96,750
USA Waste Services, Inc.
7.00% due 7/15/28........................... 238,000 264,595
Waste Management, Inc.
7.38% due 5/15/29........................... 116,000 134,376
------------
495,721
------------
Chemicals -- 0.2%
Dow Chemical Co.
8.55% due 10/15/09.......................... 111,000 136,595
Huntsman International, LLC
11.63% due 10/15/10......................... 260,000 273,000
------------
409,595
------------
Communication Equipment -- 0.1%
Rural Cellular Corp.
9.75% due 1/15/10........................... 350,000 313,250
------------
34
SunAmerica Balanced Assets Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Principal Value
Security Description Amount (Note 3)
------------------------------------------------------------------
CORPORATE BONDS (continued)
Computers & Business Equipment -- 0.2%
International Business
Machines Corp.
6.22% due 8/01/27........................ $ 238,000 $ 257,642
Xerox Corp.
7.63% due 6/15/13........................ 125,000 133,125
----------
390,767
----------
Conglomerate -- 0.2%
Tyco International Group SA
6.38% due 2/15/06........................ 238,000 253,397
Tyco International Group SA
6.88% due 1/15/29........................ 133,000 139,589
----------
392,986
----------
Electronics -- 0.1%
Amkor Technology, Inc.
7.13% due 3/15/11*....................... 175,000 175,000
----------
Energy Services -- 0.1%
Hanover Compressor Co.
zero coupon
due 3/31/07.............................. 200,000 154,000
----------
Energy Sources -- 0.4%
Amerada Hess Corp.
6.65% due 8/15/11........................ 238,000 262,975
Amerada Hess Corp.
7.30% due 8/15/31........................ 238,000 254,210
Chesapeake Energy Corp.
7.75% due 1/15/15........................ 150,000 166,125
Conoco, Inc.
6.95% due 4/15/29........................ 238,000 277,401
XTO Energy, Inc.
7.50% due 4/15/12........................ 121,000 143,883
----------
1,104,594
----------
Financial Services -- 4.9%
Alamosa Delaware, Inc.
Guaranteed Sr. Disc. Notes...............
12.00% due 7/31/09(2).................... 500,000 455,000
Athena Neurosciences Finance, LLC
7.25% due 2/21/08........................ 225,000 225,844
Bear Stearns Cos., Inc.
3.25% due 3/25/09........................ 222,000 220,059
Boeing Capital Corp.
6.10% due 3/01/11........................ 238,000 264,355
Capital One Bank
4.25% due 12/01/08....................... 238,000 243,977
Capital One Bank
5.13% due 2/15/14........................ 238,000 238,845
Capital One Financial Corp.
6.25% due 11/15/13....................... 238,000 254,050
Chukchansi Economic Development Authority
14.50% due 6/15/09*...................... 300,000 351,750
CIT Group, Inc.
4.75% due 12/15/10....................... 238,000 246,749
Conoco Funding Co.
6.35% due 10/15/11....................... 116,000 133,148
Duke Capital Corp.
5.50% due 3/01/14........................ 197,000 199,143
Financial Services
Duke Capital Corp.
Series A
6.25% due 7/15/05....................... $ 90,000 $ 94,495
Ford Motor Credit Co.
5.63% due 10/01/08...................... 186,000 191,975
Ford Motor Credit Co.
5.80% due 1/12/09....................... 238,000 245,374
General Electric Capital Corp.
6.13% due 2/22/11....................... 238,000 268,566
General Electric Capital Corp.
6.75% due 3/15/32....................... 120,000 138,620
General Motors Acceptance Corp.
4.50% due 7/15/06....................... 238,000 245,938
General Motors Acceptance Corp.
7.75% due 1/19/10....................... 238,000 269,811
Glencore Funding, LLC
6.00% due 4/15/14*...................... 203,000 201,549
J.P. Morgan Chase & Co.
4.50% due 11/15/10...................... 238,000 245,500
J.P. Morgan Chase & Co.
5.25% due 5/30/07....................... 238,000 257,007
Lehman Brothers Holdings, Inc.
4.80% due 3/13/14....................... 197,000 198,245
Morgan Stanley
3.88% due 1/15/09....................... 16,000 16,334
Morgan Stanley
4.75% due 4/01/14....................... 510,000 500,121
Morgan Stanley Dean Witter Capital I
Series 2000-LIF2 A2
7.20% due 4/01/04....................... 2,500,000 2,953,767
PPL Capital Funding, Inc.
4.33% due 3/01/09*...................... 197,000 198,899
Qwest Capital Funding, Inc.
7.90% due 8/15/10....................... 425,000 382,500
Residential Funding Mtg. Securities II
Series 2004 HI1 A3
3.05% due 7/25/16....................... 1,500,000 1,506,784
Salomon Smith Barney Holdings, Inc.
5.88% due 3/15/06....................... 238,000 257,165
Textron Financial Corp.
Series E
2.75% due 6/01/06....................... 238,000 240,381
Unilever Capital Corp.
5.90% due 11/15/32...................... 238,000 247,864
Washington Mutual Finance Corp.
6.25% due 5/15/06....................... 196,000 213,115
Washington Mutual, Inc.
4.00% due 1/15/09....................... 137,000 139,913
Washington Mutual, Inc.
4.63% due 4/01/14....................... 101,000 98,980
Wells Fargo & Co.
5.13% due 9/01/12....................... 133,000 140,272
-----------
12,086,095
-----------
Food, Beverage & Tobacco -- 0.3%
Anheuser-Busch Cos., Inc.
5.95% due 1/15/33....................... 238,000 254,081
Cargill, Inc.
3.63% due 3/04/09*...................... 98,000 98,635
35
SunAmerica Balanced Assets Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Principal Value
Security Description Amount (Note 3)
------------------------------------------------------------
CORPORATE BONDS (continued)
Food, Beverage & Tobacco (continued)
Pepsi Bottling Group, Inc.
Series B
7.00% due 3/01/29..................... $238,000 $ 281,727
---------
634,443
---------
Forest Products -- 0.3%
Georgia-Pacific Corp.
7.75% due 11/15/29.................... 150,000 152,250
Georgia-Pacific Corp.
8.63% due 4/30/25..................... 225,000 236,812
Weyerhaeuser Co.
5.50% due 3/15/05..................... 238,000 246,873
Weyerhaeuser Co.
6.13% due 3/15/07..................... 197,000 215,519
---------
851,454
---------
Health Services -- 0.2%
HCA, Inc.
6.95% due 5/01/12..................... 250,000 272,680
Highmark, Inc.
6.80% due 8/15/13*.................... 101,000 113,187
Tenet Healthcare Corp.
5.00% due 7/01/07..................... 175,000 159,688
---------
545,555
---------
Household Products -- 0.1%
Procter & Gamble Co.
5.50% due 2/01/34..................... 238,000 239,722
---------
Insurance -- 0.2%
Allstate Corp.
7.20% due 12/01/09.................... 238,000 284,496
Nationwide Mutual Insurance Co.
6.60% due 4/15/34*.................... 238,000 237,467
Prudential Financial, Inc.
4.75% due 4/01/14..................... 102,000 102,136
---------
624,099
---------
Leisure & Tourism -- 0.3%
American Airlines, Inc.
Pass-Thru Certificates,
Series 2001-1 A2
6.82% due 5/23/11..................... 350,000 323,307
Atlas Air, Inc.
Pass-Thru Certificates,
Series 1999-1 A-2
6.88% due 1/02/11..................... 225,000 207,551
Atlas Air, Inc.
Pass-Thru Certificates,
Series 1999-1 B
7.63% due 1/02/15..................... 132,618 76,868
Continental Airlines, Inc.
Pass-Thru Certificates,
Series 1999-1 C
6.95% due 8/02/09..................... 176,907 153,041
Riviera Holdings Corp.
11.00% due 6/15/10.................... 25,000 26,281
---------
787,048
---------
Machinery -- 0.1%
Dana Corp.
9.00% due 8/15/11..................... $150,000 $ 180,375
---------
Medical Products -- 0.1%
Johnson & Johnson
4.95% due 5/15/33..................... 238,000 225,697
---------
Metals & Mining -- 0.1%
Alcan, Inc.
6.13% due 12/15/33.................... 238,000 250,962
Owens-Brockway Glass Container, Inc.
8.88% due 2/15/09..................... 100,000 108,000
---------
358,962
---------
Pharmaceuticals -- 0.2%
GlaxoSmithKline Capital, Inc.
5.38% due 4/15/34..................... 245,000 242,685
Pfizer, Inc.
2.50% due 3/15/07..................... 238,000 240,345
---------
483,030
---------
Real Estate Companies -- 0.1%
EOP Operating LP
4.75% due 3/15/14..................... 202,000 199,348
---------
Real Estate Investment Trusts -- 0.1%
Omega Healthcare Investors, Inc.
7.00% due 4/01/14*.................... 225,000 230,625
---------
Retail Stores -- 0.6%
J.C. Penney Co., Inc.
7.13% due 11/15/23.................... 250,000 282,500
Rent-Way, Inc.
11.88% due 6/15/10.................... 75,000 84,000
Safeway, Inc.
7.00% due 9/15/07..................... 235,000 265,754
Wal-Mart Stores, Inc.
4.55% due 5/01/13..................... 500,000 507,194
Wal-Mart Stores, Inc.
6.88% due 8/10/09..................... 238,000 279,312
---------
1,418,760
---------
Telecommunications -- 1.1%
AT&T Corp.
6.00% due 3/15/09..................... 137,000 147,770
AT&T Corp.
8.75% due 11/15/31.................... 238,000 280,737
AT&T Wireless Services, Inc.
7.88% due 3/01/11..................... 140,000 166,955
AT&T Wireless Services, Inc.
8.75% due 3/01/31..................... 360,000 466,921
MJD Communications, Inc.
Series B
9.50% due 5/01/08..................... 400,000 404,000
Nextel Communications, Inc.
7.38% due 8/01/15..................... 525,000 568,313
Sprint Capital Corp.
6.13% due 11/15/08.................... 141,000 155,423
US West Communications, Inc.
7.13% due 11/15/43.................... 425,000 382,500
36
SunAmerica Balanced Assets Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Principal Value
Security Description Amount (Note 3)
-----------------------------------------------------------
CORPORATE BONDS (continued)
Telecommunications (continued)
Verizon Pennsylvania, Inc.
Series A
5.65% due 11/15/11................ $238,000 $ 256,113
----------
2,828,732
----------
Transportation -- 0.3%
CSX Corp.
2.75% due 2/15/06................. 238,000 240,060
FedEx Corp.
2.65% due 4/01/07*................ 218,000 217,748
Norfolk Southern Corp.
7.05% due 5/01/37................. 238,000 273,092
----------
730,900
----------
Utilities -- 1.6%
AES Corp.
7.75% due 3/01/14................. 325,000 325,406
Alabama Power Co.
2.80% due 12/01/06................ 238,000 241,094
Dominion Resources, Inc.
Series B
7.63% due 7/15/05................. 238,000 255,371
Dynegy Holdings, Inc.
8.75% due 2/15/12................. 400,000 378,000
Edison Mission Energy
9.88% due 4/15/11................. 500,000 526,250
El Paso Production Holding Co.
7.75% due 6/01/13................. 200,000 185,500
FirstEnergy Corp.
Series A
5.50% due 11/15/06................ 238,000 253,062
GTE Corp.
6.60% due 9/22/05................. 250,000 266,415
NRG Energy, Inc.
8.00% due 12/15/13*............... 325,000 335,563
Panhandle Eastern Pipe Line Co. .
2.75% due 3/15/07*................ 121,000 121,523
Progress Energy, Inc.
6.75% due 3/01/06................. 197,000 213,517
Reliant Resources, Inc.
9.50% due 7/15/13................. 375,000 413,437
Williams Cos., Inc.
8.75% due 3/15/32................. 375,000 397,500
----------
3,912,638
----------
Total Corporate Bonds
(cost $35,419,560)................ 35,286,737
----------
FOREIGN BONDS & NOTES -- 1.6%
Banks -- 0.1%
European Investment Bank
4.00% due 3/15/05................. 180,000 184,809
----------
Broadcasting & Media -- 0.1%
Telenet Group Holding NV
11.50% due 6/15/14(2)*............ 500,000 305,000
----------
Financial Services -- 0.2%
Deutsche Telekom International
Finance BV
8.75% due 6/15/30................. 238,000 312,026
Rio Tinto Finance USA, Ltd.
2.63% due 9/30/08................. $ 238,000 $ 233,093
----------
545,119
----------
Food, Beverage & Tobacco -- 0.1%
Cia Brasileira de Bebida
8.75% due 9/15/13*................ 150,000 164,625
----------
Government Agency -- 0.3%
Korea Highway
4.88% due 4/17/14*................ 90,000 89,116
Quebec Province Canada
5.00% due 7/17/09................. 238,000 257,686
Quebec Province Canada
7.50% due 7/15/23................. 238,000 306,617
----------
653,419
----------
Insurance -- 0.1%
Fairfax Financial Holdings, Ltd.
7.75% due 7/15/37................. 50,000 45,000
Fairfax Financial Holdings, Ltd.
8.25% due 10/01/15................ 175,000 180,250
----------
225,250
----------
Metals & Mining -- 0.2%
Crown European Holdings SA
10.88% due 3/01/13................ 200,000 233,000
Noranda, Inc.
7.25% due 7/15/12................. 98,000 113,949
Placer Dome, Inc.
6.45% due 10/15/35*............... 122,000 131,055
----------
478,004
----------
Telecommunications -- 0.4%
France Telecom SA
8.75% due 9/01/04................. 238,000 290,671
Koninklijke KPN NV
7.50% due 10/01/05................ 163,000 176,463
Koninklijke KPN NV
8.00% due 10/01/10................ 238,000 289,884
Telus Corp.
8.00% due 6/01/11................. 238,000 286,697
----------
1,043,715
----------
Utilities -- 0.1%
Calpine Canada Energy Finance, ULC
8.50% due 5/01/08................. 450,000 333,000
----------
Total Foreign Bonds & Notes
(cost $3,970,163)................. 3,932,941
----------
U.S. GOVERNMENT OBLIGATIONS -- 3.9%
U.S Treasury Bonds -- 1.0%
6.25% due 8/15/23.................. 1,070,000 1,272,255
6.88% due 8/15/25.................. 210,000 268,267
9.38% due 2/15/06.................. 850,000 973,084
----------
2,513,606
----------
37
SunAmerica Balanced Assets Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Principal Value
Security Description Amount (Note 3)
--------------------------------------------------------------------
U.S. GOVERNMENT OBLIGATIONS (continued)
U.S. Treasury Notes -- 2.9%
3.88% due 2/15/13.......................... $ 640,000 $ 648,700
4.00% due 2/15/14.......................... 462,000 468,064
4.63% due 5/15/06.......................... 650,000 690,600
4.88% due 2/15/12.......................... 640,000 698,625
5.00% due 2/15/11.......................... 101,000 111,494
5.88% due 11/15/04......................... 650,000 669,297
6.50% due 10/15/06......................... 1,180,000 1,316,714
6.88% due 5/15/06.......................... 1,350,000 1,497,393
7.00% due 7/15/06.......................... 1,000,000 1,118,594
-----------
7,219,481
-----------
Total U.S. Government Obligations
(cost $9,760,053)......................... 9,733,087
-----------
U.S. GOVERNMENT AGENCIES -- 16.0%
Federal Home Loan Bank -- 0.4%
1.88% due 6/15/06.......................... 495,000 495,200
5.25% due 8/15/06.......................... 495,000 531,968
-----------
1,027,168
-----------
Federal Home Loan Mortgage
Corporation -- 6.6%
2.00% due 2/23/06.......................... 1,045,000 1,049,861
2.50% due 12/04/06......................... 375,000 375,736
2.63% due 9/17/07.......................... 380,000 381,620
4.50% due 01/15/2014....................... 995,000 1,010,485
4.50% due 04/01/2019....................... 3,749,629 3,802,949
5.00% due 3/01/34.......................... 2,500,000 2,514,365
5.63% due 3/15/11.......................... 495,000 552,389
6.00% due 12/01/33......................... 4,600,000 4,782,646
6.63% due 9/15/09.......................... 995,000 1,159,714
7.00% due 4/01/32.......................... 699,930 742,130
-----------
16,371,895
-----------
Federal National Mortgage Association -- 7.3%
4.38% due 9/15/12.......................... 495,000 506,121
5.00% due 07/01/2018....................... 1,373,395 1,413,252
5.00% due 08/01/2018....................... 1,401,386 1,442,055
5.00% due 01/01/2033....................... 1,956,625 1,967,208
5.50% due 11/01/2017....................... 905,295 944,126
5.50% due 12/01/2033....................... 5,750,001 5,894,631
6.00% due 6/01/17.......................... 750,000 790,498
6.50% due 09/01/2010....................... 344,888 367,571
6.50% due 09/01/2032....................... $3,400,000 $ 3,572,110
6.63% due 11/15/30......................... 995,000 1,186,700
-----------
18,084,272
-----------
Government National Mortgage
Association -- 1.3%
5.50% due 05/15/2033....................... 960,757 989,111
5.50% due 09/15/2033....................... 545,619 561,721
5.50% due 12/15/2033....................... 388,524 399,990
5.50% due 12/15/2033....................... 614,918 633,066
7.50% due 01/15/2032....................... 596,016 641,017
7.50% due 04/15/2032....................... 4,044 4,349
-----------
3,229,254
-----------
Other -- 0.4%
Resolution Funding Corp. Strip
zero coupon due 04/15/09.................. 1,000,000 857,256
-----------
Total U.S. Government Agencies
(cost $39,253,472)........................ 39,569,845
-----------
Total Investment Securities -- 99.8%
(cost $232,746,988)....................... 246,610,302
-----------
TOTAL INVESTMENTS --
(cost $232,746,988) (See Note 6) 99.8% 246,610,302
Other assets less liabilities................ 0.2 481,659
--------- ------------
NET ASSETS -- 100.00% $247,091,961
========= ============
- --------
+ Non-income producing security
* Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be sold in transactions exempt from
registration, normally to qualified institutional buyers. At March 31,
2004, the aggregate value of these securities was $3,345,492 representing
1.4% of net assets.
(1) The security is a "floating rate" bond where the coupon rate fluctuates.
The rate steps up or down for each rate downgrade or upgrade. The rate
reflected is as of March 31, 2004.
(2) The interest rate shown represents the step-up coupon rate at which the
bond accrues or will accrue at a specified date.
ADR --American Depository Receipt
See Notes to Financial Statements
38
SunAmerica International Equity Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
----------------------------------------------------------------------------
COMMON STOCK -- 98.1%
Australia -- 3.2%
BHP Billiton, Ltd. (Materials)................... 142,400 $ 1,331,802
News Corp., Ltd. Sponsored ADR (Information &
Entertainment).................................. 39,400 1,417,612
-----------
2,749,414
-----------
Belgium -- 1.1%
Solvay SA (Materials)............................ 11,930 959,088
-----------
Denmark -- 2.1%
Danske Bank A/S (Finance)........................ 81,770 1,849,695
-----------
France -- 5.6%
BNP Paribas SA (Finance)......................... 38,370 2,345,582
Technip SA (Energy).............................. 18,670 2,524,511
-----------
4,870,093
-----------
Germany -- 8.5%
Allianz AG (Finance)............................. 14,760 1,607,716
Deutsche Telekom AG (Information Technology)..... 51,360 923,023
E.ON AG (Utilities).............................. 23,000 1,515,420
SAP AG (Information Technology).................. 8,640 1,366,356
Siemens AG (Industrial & Commercial)............. 25,500 1,882,947
-----------
7,295,462
-----------
Greece -- 1.7%
Alpha Bank A.E. (Finance)........................ 47,300 1,454,751
-----------
Hong Kong -- 0.0%
Peregrine Investments Holdings, Ltd.
(Finance)+(1)................................... 91,000 0
-----------
India -- 1.1%
Reliance Industries, Ltd. GDR (Materials)*....... 34,300 983,381
-----------
Indonesia -- 1.2%
PT Astra International Tbk (Consumer
Discretionary).................................. 1,686,000 1,053,319
-----------
Ireland -- 2.1%
Depfa Bank, PLC (Finance)........................ 11,410 1,795,295
-----------
Israel -- 2.1%
Teva Pharmaceutical Industries, Ltd. Sp. ADR
(Health Care)................................... 29,100 1,845,231
-----------
Italy -- 1.9%
Fondiaria - SAI SpA (Finance).................... 68,370 1,609,440
-----------
Japan -- 23.3%
Asahi Breweries, Ltd. (Consumer Staples)......... 129,600 1,501,437
Chugai Pharmaceutical Co., Ltd. (Health Care).... 80,600 1,281,121
Fast Retailing Co. (Consumer Discretionary)...... 29,500 2,409,608
Hirose Electric Co., Ltd. (Information
Technology)..................................... 14,000 1,554,734
Millea Holdings, Inc. (Finance).................. 54 839,660
Mitsubishi Corp. (Industrial & Commercial)....... 54,000 637,520
Mitsui O.S.K. Lines, Ltd. (Industrial &
Commercial)..................................... 288,000 1,481,672
Nomura Holdings, Inc. (Finance).................. 39,000 709,363
Obayashi Corp. (Industrial & Commercial)......... 185,000 1,010,366
Osaka Gas Co., Ltd. (Utilities).................. 233,000 695,523
Sony Corp. (Information & Entertainment)......... 58,000 2,427,221
Sumitomo Mitsui Financial Group, Inc.
(Finance)....................................... 278 2,054,615
Toyota Motor Corp. (Consumer Discretionary)...... 28,500 $ 1,061,381
Trend Micro, Inc. (Information Technology)....... 22,000 760,186
Yaskawa Electric Corp. (Industrial &
Commercial)..................................... 203,000 1,683,467
-----------
20,107,874
-----------
Korea -- 2.4%
Cheil Communications, Inc. (Information &
Entertainment).................................. 6,700 1,084,085
Samsung Electronics Co., Ltd. (Information
Technology)..................................... 1,900 947,970
-----------
2,032,055
-----------
Malaysia -- 1.3%
Telekom Malaysia Berhad (Information
Technology)..................................... 406,100 1,100,745
-----------
Mexico -- 1.9%
America Movil SA de CV ADR (Information
Technology)..................................... 17,500 676,375
Grupo Modelo SA de CV (Consumer Staples)......... 349,700 951,324
-----------
1,627,699
-----------
Norway -- 4.8%
Statoil ASA (Energy)............................. 336,350 4,106,793
-----------
Singapore -- 2.3%
Hi-P International, Ltd. (Industrial &
Commercial)..................................... 2,121,000 1,558,255
Singapore Telecommunications, Ltd. (Information
Technology)..................................... 301,000 418,904
-----------
1,977,159
-----------
South Africa -- 0.7%
Naspers, Ltd. (Information & Entertainment)...... 82,993 578,853
-----------
Spain -- 2.6%
Fomento de Construcciones y Contratas SA
(Industrial & Commercial)....................... 31,530 1,146,082
Iberdrola SA (Utilities)......................... 51,400 1,061,482
-----------
2,207,564
-----------
Sweden -- 2.9%
Volvo AB--Class B (Consumer Discretionary)....... 76,440 2,516,606
-----------
Switzerland -- 4.5%
Nestle SA (Consumer Staples)..................... 5,970 1,521,649
UBS AG (Finance)................................. 31,570 2,344,239
-----------
3,865,888
-----------
United Kingdom -- 19.5%
Amdocs, Ltd. (Information Technology)+........... 18,100 502,999
AstraZeneca, PLC (Health Care)................... 49,260 2,287,368
British Sky Broadcasting Group, PLC (Information
& Entertainment)................................ 84,370 1,053,567
Burberry Group, PLC (Consumer
Discretionary).................................. 351,220 2,306,044
Enterprise Inns, PLC (Information &
Entertainment).................................. 148,980 1,676,674
LogicaCMG, PLC (Information &
Entertainment).................................. 177,500 837,118
Prudential, PLC (Finance)........................ 208,360 1,716,057
39
SunAmerica International Equity Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Value
Security Description Shares (Note 3)
--------------------------------------------------------------------------
COMMON STOCK (continued)
United Kingdom (continued)
Reuters Group, PLC (Information &
Entertainment)................................. 212,610 $ 1,514,325
Tesco, PLC (Consumer Discretionary)............. 506,200 2,289,496
Vodafone Group, PLC Sp. ADR (Information
Technology).................................... 61,640 1,473,196
WPP Group, PLC (Information &
Entertainment)................................. 116,570 1,181,050
------------
16,837,894
------------
United States -- 1.3%
Synthes-Stratec, Inc. (Health Care)............. 1,140 1,168,562
------------
Total Common Stock
(cost $75,960,864)............................. 84,592,861
------------
PREFERRED STOCK -- 0.9%
Brazil -- 0.9%
Caemi Mineracao e Metalurgica SA (Materials)
(cost $546,999)................................ 1,700,000 801,307
------------
Total Investment Securities -- 99.0%
(cost $76,507,863)............................. 85,394,168
------------
REPURCHASE AGREEMENTS -- 0.5%
Agreement with State Street Bank & Trust Co.,
bearing interest at 0.35%, dated 03/31/04, to
be repurchased 04/01/04 in the amount of
$449,004 and collateralized by $449,000 of
United States Treasury Bonds, bearing interest
at 6.13% due 11/15/27 and having an
approximate value of $462,963
(cost $449,000)................................ $ 449,000 $ 449,000
------------
Total Investments
(cost $76,956,863) (See Note 6)................ 99.5% 85,843,168
Other assets less liabilities..................... 0.5 405,223
-------- ------------
NET ASSETS -- 100.00% $ 86,248,391
======== ============
- --------
+ Non-income producing security
* Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be sold in transactions exempt from
registration, normally to qualified institutional buyers. At March 31,
2004, the aggregate value of these securities was $983,381 representing
1.1% of net assets.
(1) Fair Valued Security. See Note 3
ADR --American Depository Receipt
GDR --Global Depository Receipt
See Notes to Financial Statements
40
SunAmerica Value Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
---------------------------------------------------------------
COMMON STOCK -- 71.6%
Aerospace & Military Technology -- 2.2%
Honeywell International, Inc..... 82,100 $ 2,779,085
Rockwell Collins, Inc............ 45,200 1,428,772
-----------
4,207,857
-----------
Apparel & Textiles -- 0.2%
V. F. Corp............................... 6,900 322,230
-----------
Automotive -- 0.9%
Genuine Parts Co......................... 53,300 1,743,976
-----------
Banks -- 8.5%
Bank of America Corp..................... 59,000 4,777,820
BB&T Corp................................ 12,450 439,485
Commerce Bancshares, Inc................. 43,239 2,062,933
Mercantile Bankshares Corp............... 51,500 2,212,955
SunTrust Banks, Inc...................... 28,700 2,000,677
UMB Financial Corp....................... 39,930 2,024,451
United Bankshares, Inc................... 16,400 500,200
Washington Federal, Inc.................. 40,198 1,026,255
Whitney Holding Corp..................... 27,700 1,156,198
-----------
16,200,974
-----------
Business Services -- 0.3%
Waste Management, Inc.................... 16,600 500,988
-----------
Chemicals -- 1.6%
Air Products and Chemicals, Inc.......... 45,826 2,296,799
du Pont (E.I.) de Nemours & Co........... 17,400 734,628
-----------
3,031,427
-----------
Computers & Business Equipment -- 0.7%
Pitney Bowes, Inc........................ 31,900 1,359,259
-----------
Conglomerate -- 0.4%
Olin Corp................................ 41,478 740,382
-----------
Computer Software -- 0.9%
Microsoft Corp........................... 65,300 1,630,541
-----------
Electric Utilities -- 1.5%
Ameren Corp.............................. 34,896 1,608,357
IDACORP, Inc............................. 44,100 1,318,590
-----------
2,926,947
-----------
Electrical Equipment -- 1.2%
Hubbell, Inc., Class B................... 54,627 2,192,182
-----------
Electronics -- 2.5%
Emerson Electric Co...................... 80,200 4,805,584
-----------
Energy Services -- 0.6%
Weststar Energy, Inc..................... 56,002 1,173,802
-----------
Energy Sources -- 11.2%
BP, PLC.................................. 112,100 5,739,520
Exxon Mobil Corp......................... 195,200 8,118,368
Nicor, Inc............................... 21,600 760,968
Royal Dutch Petroleum Co................. 144,042 6,853,518
-----------
21,472,374
-----------
Entertainment Products -- 0.6%
Mattel, Inc.............................. 63,600 1,172,784
-----------
Financial Services -- 1.6%
A.G. Edwards, Inc........................ 37,126 $ 1,452,369
Freddie Mac.............................. 26,500 1,565,090
-----------
3,017,459
-----------
Food, Beverage & Tobacco -- 4.5%
Archer-Daniels-Midland Co................ 22,100 372,827
Campbell Soup Co......................... 17,200 469,044
ConAgra, Inc............................. 33,400 899,796
H.J. Heinz Co............................ 61,700 2,300,793
Kellogg Co............................... 41,200 1,616,688
Kraft Foods, Inc., Class A............... 36,900 1,181,169
Unilever NV.............................. 12,700 881,888
UST, Inc................................. 21,583 779,146
-----------
8,501,351
-----------
Forest Products -- 3.5%
Bemis Co., Inc........................... 102,300 2,659,800
Rayonier, Inc............................ 64,271 2,809,285
Sonoco Products Co....................... 46,700 1,133,876
-----------
6,602,961
-----------
Gas & Pipeline Utilities -- 4.8%
AGL Resources, Inc....................... 73,747 2,140,138
Cascade Natural Gas Corp................. 32,085 699,132
Piedmont Natural Gas Co., Inc............ 65,148 2,750,549
WGL Holdings, Inc........................ 121,700 3,663,170
-----------
9,252,989
-----------
Household Products -- 3.6%
Clorox Co................................ 29,700 1,452,627
International Flavors & Fragrances, Inc.. 20,600 731,300
Kimberly-Clark Corp...................... 75,500 4,764,050
-----------
6,947,977
-----------
Housing & Household Durables -- 1.0%
Hunter Douglas NV........................ 9,595 483,699
Stanley Works............................ 7,400 315,832
Whirlpool Corp........................... 15,300 1,053,711
-----------
1,853,242
-----------
Insurance -- 5.6%
Allstate Corp............................ 57,800 2,627,588
CNA Surety Corp.+........................ 76,826 848,927
Jefferson-Pilot Corp..................... 29,900 1,644,799
Kansas City Life Insurance Co............ 6,810 291,400
Marsh & McLennan Cos., Inc............... 116,100 5,375,430
-----------
10,788,144
-----------
Machinery -- 1.7%
Nordson Corp............................. 6,525 244,426
Snap-On Tools, Inc....................... 94,200 3,046,428
-----------
3,290,854
-----------
Medical Products -- 1.5%
Abbott Laboratories...................... 71,600 2,942,760
-----------
Metals & Minerals -- 0.8%
Vulcan Materials Co...................... 33,579 1,592,988
-----------
41
SunAmerica Value Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Value
Security Description Shares (Note 3)
------------------------------------------------------------------
COMMON STOCK (continued)
Pharmaceuticals -- 3.1%
Bristol-Myers Squibb Co..................... 160,400 $ 3,886,492
Merck & Co., Inc............................ 42,000 1,855,980
Schering-Plough Corp........................ 10,700 173,554
------------
5,916,026
------------
Real Estate Investment Trusts -- 0.4%
Sun Communities, Inc........................ 18,700 800,734
------------
Retail -- 1.8%
Limited Brands.............................. 175,200 3,504,000
------------
Telecommunications -- 3.4%
CenturyTel, Inc.(1)......................... 39,400 944,812
SBC Communications, Inc..................... 74,931 1,838,807
Verizon Communications, Inc................. 100,800 3,683,232
------------
6,466,851
------------
Transportation -- 1.0%
Burlington Northern Santa Fe Corp........... 62,600 1,971,900
------------
Total Common Stock
(cost $124,370,097)........................ 136,931,543
------------
PREFERRED STOCK -- 12.3%
Aerospace & Military Technology -- 2.4%
Northrup Grumman Corp.,
Series B
7.00% (Convertible)........................ 7,100 910,575
Raytheon Co.
8.25% (Convertible)(1)..................... 74,000 3,770,300
------------
4,680,875
------------
Computers & Business Equipment -- 0.4%
Goldman Sachs Group, Inc., MTN,
11.50% (Convertible to Seagate Technology,
Inc.)...................................... 41,300 673,603
------------
Electric Utilities -- 4.1%
Ameren Corp.
9.75% (Convertible)(1)..................... 154,000 4,304,300
FPL Group, Inc.
8.00% (Convertible)(1)..................... 62,400 3,618,576
------------
7,922,876
------------
Energy Equipment -- 0.4%
Goldman Sachs Group, Inc., MTN,
6.13% (Convertible to Cooper Cameron
Corp.)..................................... 16,000 704,160
------------
Energy Sources -- 1.1%
Unocal Capital Trust
6.25% (Convertible)........................ 41,400 2,194,200
------------
Financial Services -- 0.9%
Citigroup Capital IX 6.00%.................. 37,100 956,067
Newell Financial Trust I
5.25% (Convertible)........................ 14,200 669,175
------------
1,625,242
------------
Food, Beverage & Tobacco -- 0.5%
Goldman Sachs Group, Inc., MTN,
6.38% (Convertible to Kraft Foods, Inc.)... 31,500 1,009,260
------------
Shares/
Principal Value
Security Description Amount (Note 3)
-----------------------------------------------------------------------
Forest Products -- 0.5%
International Paper Capital Trust
5.25% (Convertible).......................... 19,800 $ 990,000
-----------
Insurance -- 1.4%
Chubb Corp.
7.00% (Convertible)(1)....................... 45,109 1,285,607
Hartford Financial Services Group Inc.
7.00% (Convertible).......................... 22,710 1,447,762
-----------
2,733,369
-----------
Leisure & Tourism -- 0.6%
Goldman Sachs Group, Inc., MTN,
6.63% (Convertible to Brinker International,
Inc.)........................................ 32,700 1,065,366
-----------
Total Preferred Stock
(cost $22,958,101)........................... 23,598,951
-----------
CONVERTIBLE BONDS & NOTES -- 10.3%
Broadcasting & Media -- 0.4%
Valassis Communications, Inc.
zero coupon due 6/06/21...................... $1,369,000 824,822
-----------
Business Services -- 1.3%
BISYS Group, Inc.
4.00% due 3/15/06............................ 800,000 804,000
Goldman Sachs Group, Inc., MTN
(Convertible into Waste Management, Inc.)
2.50% due 5/09/10............................ 1,652,000 1,691,152
WMX Technologies
2.00% due 1/24/05............................ 38,000 36,374
-----------
2,531,526
-----------
Computers & Business Equipment -- 1.0%
Hewlett-Packard Co.
zero coupon due 10/14/17..................... 3,523,000 2,030,129
-----------
Computer Software -- 0.4%
DST Systems, Inc.
3.63% due 8/15/23............................ 598,000 715,358
-----------
Energy Services -- 0.8%
Schlumberger, Ltd.
2.13% due 6/01/23............................ 1,388,000 1,500,775
-----------
Energy Sources -- 3.2%
Devon Energy Corp.
4.90% due 8/15/08............................ 2,304,000 2,367,360
Devon Energy Corp.
4.95% due 8/15/08............................ 3,627,000 3,726,742
-----------
6,094,102
-----------
Health Services -- 0.7%
Lifepoint Hospitals, Inc.
4.50% due 6/01/09............................ 1,008,000 1,048,320
Universal Health Services, Inc.
zero coupon due 6/23/20...................... 375,000 226,875
-----------
1,275,195
-----------
42
SunAmerica Value Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Principal Value
Security Description Amount (Note 3)
------------------------------------------------------------------
CONVERTIBLE BONDS & NOTES (continued)
Housing & Household Durables -- 1.4%
Goldman Sachs Group, Inc., MTN
(Convertible into Whirlpool Corp.)
3.00% due 6/11/13....................... $1,814,000 $ 1,741,313
Masco Corp.
zero coupon due 7/20/31................. 1,870,000 867,213
------------
2,608,526
------------
Insurance -- 0.8%
Loews Corp.
3.13% due 9/15/07....................... 1,544,000 1,524,700
------------
Telecommunications -- 0.3%
Commonwealth Telephone Enterprises, Inc.
3.25% due 7/15/23*...................... 485,000 503,794
------------
Total Convertible Bonds & Notes
(cost $19,214,810)...................... 19,608,927
------------
EXCHANGE TRADED FUNDS -- 4.8%
Financial Services -- 4.8%
SPDR Trust Co.
(cost $8,716,397)....................... 80,600 9,120,696
------------
OPTIONS PURCHASED -- 0.0%
Banks -- 0.0%
Bank of America Corp./August 2004/$80
(cost $117,990)......................... 23,000 80,500
------------
Total Investment Securities -- 99.0%
(cost $175,377,395)..................... 189,340,617
------------
REPURCHASE AGREEMENTS -- 1.0%
Agreement with State Street Bank
& Trust Co., bearing interest at
0.35%, dated 03/31/04, to be
repurchased 04/01/04 in the
amount of $1,930,019 and
collateralized by $1,640,000 of
United States Treasury Bonds,
bearing interest at 6.13% due
11/15/27 and having an
approximate value of $1,972,100
(cost $1,930,000)....................... $1,930,000 $ 1,930,000
------------
TOTAL INVESTMENTS --
(cost $177,307,395) (See Note 6) 100.0% 191,270,617
Liabilities in excess of other assets...... 0.0 (84,012)
---------- ------------
NET ASSETS -- 100.0% $191,186,605
========== ============
- --------
+ Non-income producing securities
* Securities exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be sold in transactions exempt from registration,
normally to qualified institutional buyers. At March 31, 2004, the aggregate
value of these securities was $503,794 representing 0.3% of net assets.
(1)Consists of more than one class of securities traded together as a unit.
Open Forward Foreign Currency Contracts
----------------------------------------------------
Gross
Contract to In Exchange Delivery Unrealized
Deliver For Date (Depreciation)
------------- ------------- ---------- --------------
EUR 6,622,849 USD 8,040,650 04/30/2004 $ (93,747)
GBP 3,087,816 USD 5,605,357 04/30/2004 (62,386)
---------
$(156,133)
=========
- --------
EUR -- Euro
GBP -- BritishPound
USD -- UnitedStates Dollar
See Notes to Financial Statements
43
SunAmerica Biotech/Health Funds
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
-----------------------------------------------------------
COMMON STOCK -- 88.1%
Biomedical -- 5.4%
Affymetrix, Inc.+.................... 60,000 $ 2,025,000
Keryx Biopharmaceuticals, Inc.+...... 50,000 764,000
-----------
2,789,000
-----------
Biotechnology -- 6.9%
Alkermes, Inc.+...................... 75,000 1,199,250
Biomarin Pharmaceutical, Inc.+....... 100,000 752,000
Medicines Co.+@...................... 50,000 1,610,500
-----------
3,561,750
-----------
Distribution -- 8.1%
Caremark Rx, Inc.+................... 60,000 1,995,000
Merck & Co., Inc.@................... 50,000 2,209,500
-----------
4,204,500
-----------
Genomics -- 9.2%
Invitrogen Corp.+.................... 40,000 2,867,600
Protein Design Labs, Inc.+........... 80,000 1,905,600
-----------
4,773,200
-----------
Health Maintenance Organization -- 7.0%
Anthem, Inc.+........................ 30,000 2,719,200
Centene Corp.+....................... 30,000 917,700
-----------
3,636,900
-----------
Health Services -- 3.6%
Manor Care, Inc.@.................... 50,000 1,764,500
Medco Health Solutions, Inc.+........ 2,412 82,008
-----------
1,846,508
-----------
Medical Devices -- 3.8%
Integra LifeSciences Holdings........ 65,000 1,990,300
-----------
Medical Drugs -- 12.5%
Celgene Corp.+@...................... 50,000 2,382,500
Cephalon, Inc.+...................... 50,000 2,865,500
Pozen, Inc.+......................... 25,000 345,500
Watson Pharmaceuticals, Inc.+........ 20,000 855,800
-----------
6,449,300
-----------
Medical Information Systems -- 1.7%
Covance, Inc.+....................... 25,000 861,000
-----------
Medical Products -- 0.8%
Encore Medical Corp.+................ 50,000 400,500
-----------
Pharmaceuticals -- 22.5%
Allergan, Inc........................ 30,000 2,524,800
Eon Labs, Inc.+@..................... 30,000 2,012,400
Express Scripts, Inc.+............... 20,000 1,491,800
Onyx Pharmaceuticals, Inc.+.......... 20,000 809,200
Shares/
Principal Value
Security Description Amount (Note 3)
-------------------------------------------------------------------
Pharmaceuticals (continued)
Pfizer, Inc.@........................... 60,000 $ 2,103,000
Praecis Pharmaceuticals, Inc.+.......... 90,000 531,900
Tanox, Inc.+............................ 100,000 1,489,000
Vicuron Phamaceuticals, Inc.+........... 30,000 682,500
-----------
11,644,600
-----------
Therapeutics -- 6.6%
Abgenix, Inc.+.......................... 100,000 1,329,000
Cypress Bioscience, Inc.+............... 60,000 685,200
Discovery Laboratories, Inc.+........... 50,000 609,500
Dyax Corp.+............................. 75,000 771,750
-----------
3,395,450
-----------
Total Investment Securities -- 88.1%
(cost $36,659,862)..................... 45,553,008
-----------
REPURCHASE AGREEMENTS -- 13.1%
State Street Bank & Trust Co.
Joint Repurchase Agreement
(See Note 3)@
(cost $6,764,000)...................... 6,764,000 6,764,000
-----------
TOTAL INVESTMENTS --
(cost $43,423,862) (See Note 6)......... 101.2% 52,317,008
Liabilities in excess of other assets..... (1.2) (602,463)
---------- -----------
NET ASSETS -- 100.00% $51,714,545
========== ===========
COMMON STOCK-SHORT POSITIONS -- (7.7%)
Biotechnology -- (0.8%)
Diversa Corp............................ $ (50,000) (443,000)
-----------
Genomics -- (1.9%)
Genencor International, Inc............. (27,000) (359,370)
Human Genome Sciences, Inc.............. (50,000) (626,500)
-----------
(985,870)
-----------
Medical Drugs -- (1.5%)
OSI Pharmaceuticals, Inc................ (20,000) (768,000)
-----------
Pharmaceuticals -- (1.5%)
Bradley Pharmaceuticals, Inc............ (30,000) (755,400)
-----------
Therapeutics -- (2.0%)
Imclone Systems, Inc.................... (20,000) (1,017,200)
-----------
Total Common Stock-Short Positions -- 7.7%
(proceeds $(3,835,983))................. $(3,969,470)
-----------
- --------
+ Non-income producing securities
@ Collateral for securities sold short
See Notes to Financial Statements
44
Tax Managed Equity Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited)
Value
Security Description Shares (Note 3)
----------------------------------------------------------
COMMON STOCK -- 99.1%
Aerospace & Military Technology -- 2.5%
Raytheon Co........................... 17,000 $ 532,780
United Technologies Corp.............. 11,000 949,300
----------
1,482,080
----------
Apparel & Textiles -- 0.7%
Jones Apparel Group, Inc.............. 12,000 433,800
----------
Banks -- 4.4%
Bank of America Corp.................. 8,000 647,840
Bank of New York Co., Inc............. 20,000 630,000
FleetBoston Financial Corp............ 10,000 449,000
U.S. Bancorp.......................... 31,831 880,127
----------
2,606,967
----------
Broadcasting & Media -- 4.2%
E.W. Scripps Co., Class A............. 5,000 505,550
Gannett Co., Inc...................... 7,000 616,980
News Corp., Ltd. Sponsored ADR........ 12,600 453,348
Viacom, Inc., Class B................. 23,000 901,830
----------
2,477,708
----------
Business Services -- 1.0%
Accenture, Ltd., Class A+............. 23,000 570,400
----------
Chemicals -- 0.8%
Air Products & Chemicals, Inc......... 9,000 451,080
----------
Communication Equipment -- 0.2%
Juniper Networks, Inc.+............... 5,000 130,050
----------
Computer Software -- 4.4%
Microsoft Corp........................ 69,200 1,727,924
Oracle Corp.+......................... 30,000 360,300
SunGard Data Systems, Inc.+........... 20,000 548,000
----------
2,636,224
----------
Computers & Business Equipment -- 4.9%
Dell, Inc.+........................... 19,000 638,780
Intel Corp............................ 43,700 1,188,640
International Business Machines Corp.. 11,800 1,083,712
----------
2,911,132
----------
Conglomerate -- 5.3%
General Electric Co................... 64,800 1,977,696
Tyco International, Ltd............... 40,500 1,160,325
----------
3,138,021
----------
Electronics -- 3.1%
Altera Corp.+......................... 15,000 306,750
Analog Devices, Inc................... 5,000 240,050
Applied Materials, Inc.+.............. 12,000 256,560
Johnson Controls, Inc................. 17,600 1,041,040
----------
1,844,400
----------
Energy Services -- 1.3%
Baker Hughes, Inc..................... 21,000 766,080
----------
Energy Sources -- 6.5%
Anadarko Petroleum Corp............... 8,000 414,880
ChevronTexaco Corp.................... 17,500 1,536,150
ConocoPhillips........................ 9,000 628,290
Exxon Mobil Corp...................... 30,120 1,252,691
----------
3,832,011
----------
Financial Services -- 11.1%
Capital One Financial Corp............ 5,500 $ 414,865
CIT Group, Inc........................ 6,000 228,300
Citigroup, Inc........................ 48,333 2,498,816
Freddie Mac........................... 20,000 1,181,200
Goldman Sachs Group, Inc.............. 6,002 626,309
Morgan Stanley........................ 11,500 658,950
Washington Mutual, Inc................ 13,350 570,178
Wells Fargo & Co...................... 7,000 396,690
----------
6,575,308
----------
Food, Beverage & Tobacco -- 4.0%
Altria Group, Inc..................... 17,800 969,210
Coca-Cola Co.......................... 17,400 875,220
PepsiCo, Inc.......................... 9,300 500,805
----------
2,345,235
----------
Forest Products -- 1.2%
Temple-Inland, Inc.................... 11,400 722,076
----------
Household Products -- 4.4%
Colgate-Palmolive Co.................. 8,000 440,800
Gillette Co........................... 19,200 750,720
Procter & Gamble Co...................13,300 1,394,904
----------
2,586,424
----------
Insurance -- 5.7%
Allstate Corp......................... 8,000 363,680
Ambac Financial Group, Inc............ 15,400 1,136,212
American International Group, Inc.#... 11,580 826,233
RenaissanceRe Holdings, Ltd........... 10,000 520,000
Torchmark Corp........................ 5,000 268,950
Willis Group Holdings, Ltd............ 7,000 260,400
----------
3,375,475
----------
Machinery -- 2.9%
Cooper Industries, Ltd., Class A...... 7,000 400,260
Danaher Corp.......................... 5,500 513,535
Deere & Co............................ 11,400 790,134
----------
1,703,929
----------
Medical Products -- 3.5%
Guidant Corp.......................... 16,500 1,045,605
Johnson & Johnson..................... 20,444 1,036,920
----------
2,082,525
----------
Metals & Mining -- 1.1%
Alcoa, Inc............................ 18,928 656,613
----------
Pharmaceuticals -- 7.8%
Amgen, Inc.+.......................... 10,500 610,785
Eli Lilly and Co...................... 15,400 1,030,260
Gilead Sciences, Inc.+................ 7,000 390,390
Pfizer, Inc........................... 55,305 1,938,440
Sepracor, Inc.+....................... 6,000 288,600
Wyeth................................. 9,000 337,950
----------
4,596,425
----------
Restaurants -- 0.6%
Yum! Brands, Inc.+.................... 9,000 341,910
----------
45
Tax Managed Equity Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2004 -- (unaudited) (continued)
Value
Security Description Shares (Note 3)
----------------------------------------------------------
COMMON STOCK (continued)
Retail Stores -- 7.2%
Home Depot, Inc................................. 24,550 $ 917,188
Target Corp..................................... 19,700 887,288
TJX Cos, Inc.................................... 28,500 699,960
Wal-Mart Stores, Inc............................ 29,800 1,778,762
---------
4,283,198
---------
Telecommunications -- 7.2%
Cisco Systems, Inc.+............................ 69,400 1,632,288
Comcast Corp., Class A+......................... 23,700 660,756
Nextel Communications, Inc., Class A+........... 5,000 123,650
QUALCOMM, Inc................................... 8,000 531,360
SBC Communications, Inc......................... 14,400 353,376
Verizon Communications, Inc..................... 26,730 976,714
---------
4,278,144
---------
Transportation -- 1.0%
Union Pacific Corp.............................. 10,000 598,200
---------
Utilities -- 2.1%
Dominion Resources, Inc......................... 9,000 $ 578,700
Pinnacle West Capital Corp...................... 17,000 668,950
-----------
1,247,650
-----------
Total Investment Securities -- 99.1%
(cost $59,203,236)............................. 58,673,065
-----------
SHORT-TERM INVESTMENTS -- 0.3%
Time Deposit with State Street Bank & Trust Co.
0.05% due 04/01/04
(cost $168,000)................................ 168,000 168,000
-----------
TOTAL INVESTMENTS --
(cost $59,371,236) (See Note 6)................ 99.4% 58,841,065
Other assets less liabilities................... 0.6 379,426
--------- -----------
NET ASSETS -- 100.00% $59,220,491
========= ===========
- --------
+ Non-Income producing security
# Security represents an investment in an affiliated company -- See Note 9
ADR --American Depository Receipt
See Notes to Financial Statements
46
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
Note 1. Organization
SunAmerica Equity Funds is registered under the Investment Company Act 1940,
as amended, (the "1940 Act") as an open-end diversified management
investment company and is organized as a Massachusetts business trust (the
"Trust" or "Equity Funds") on June 16, 1986. It currently consists of nine
different investment funds (each, a "Fund" and collectively, the "Funds").
Each Fund is a separate series of the Trust with a distinct investment
objective and/or strategy. Each Fund is advised and/or managed by AIG
SunAmerica Asset Management Corp. (the "Adviser" or "SAAMCo"), an indirect
wholly-owned subsidiary of American International Group, Inc. An investor
may invest in one or more of the following Funds: SunAmerica Blue Chip
Growth Fund ("Blue Chip Growth Fund"), SunAmerica Growth Opportunities Fund
("Growth Opportunities Fund"), SunAmerica New Century Fund ("New Century
Fund"), SunAmerica Growth and Income Fund ("Growth and Income Fund"),
SunAmerica Balanced Assets Fund ("Balanced Assets Fund"), SunAmerica
International Equity Fund ("International Equity Fund"), SunAmerica Value
Fund ("Value Fund"), SunAmerica Biotech/Health Fund ("Biotech/Health Fund"),
and Tax Managed Equity Fund ("Tax Managed Equity Fund"). The Funds are
considered to be separate entities for financial and tax reporting purposes.
The investment objective for each of the Funds is as follows:
Blue Chip Growth Fund seeks capital appreciation, by primarily investing in
equity securities of Blue Chip companies that demonstrate the potential for
capital appreciation, issued by large-cap companies. At least 80% of the
Fund's net assets plus any borrowing for investment purposes will be
invested in such securities.
Growth Opportunities Fund seeks capital appreciation, by primarily investing
in equity securities that demonstrate the potential for capital
appreciation, issued generally by small-cap companies.
New Century Fund seeks capital appreciation, by investing in equity
securities that demonstrate the potential for capital appreciation, without
regard to market capitalization.
Growth and Income Fund seeks capital appreciation and current income, by
investing in equity securities issued by companies of any size, that pay
dividends, demonstrate the potential for capital appreciation and/or are
believed to be undervalued in the market.
Balanced Assets Fund seeks capital appreciation and conservation of
principal, through active trading partly in equity securities that
demonstrate the potential for capital appreciation issued by companies with
market capitalization of over $1.5 billion, and partly in high-quality bonds.
International Equity Fund seeks capital appreciation, by investing in equity
securities and other securities with equity characteristics of non-U.S.
issuers located in at least three countries other than the U.S. and selected
without regard to market capitalization. At least 80% of the Fund's net
assets plus any borrowing for investment purposes will be invested in such
securities.
Value Fund seeks long-term growth of capital through active trading of
equity securities selected on the basis of value criteria, issued by
companies of any market capitalization.
Biotech/Health Fund seeks long-term growth of capital through active trading
of equity securities of companies principally engaged in biotechnology or
healthcare, without regard to market capitalization. Under normal market
conditions this Fund invests at least 80% of the Fund's net assets plus any
borrowing for investment purposes, in such securities.
Tax Managed Equity Fund seeks high total return while minimizing the impact
of capital gains through active trading of equity securities of large and
medium-sized U.S. companies while attempting to minimize capital gain
distributions to shareholders. Under normal market conditions this Fund
invests at least 80% of the Fund's net assets plus any borrowing for
investment purposes, in equity securities.
Each Fund offers multiple classes of shares. The classes within each Fund
are presented in the Statement of Assets and Liabilities. The cost structure
for each class is as follows:
Class A shares are offered at net asset value per share plus an initial
sales charge. Additionally, any purchases of Class A shares in excess of
$1,000,000 will be purchased at net asset value but will be subject to a
contingent deferred sales charge on redemptions made within two years of
purchase.
47
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
Class B shares are offered without an initial sales charge, although a
declining contingent sales charge may be imposed on redemptions made within
six years of purchase. Class B shares of each Fund convert automatically to
Class A shares on the first business day of the month following the eighth
anniversary of the issuance of such Class B shares and at such time will be
subject to the lower distribution fee applicable to Class A shares.
Class C shares are offered at net asset value per share without an initial
sales charge, although may be subject to a contingent deferred sales charge
on redemptions made within 12 months of purchase. Effective February 23,
2004 Class II shares were redesignated to Class C shares.
Class I, Class X and Class Z shares are offered at net asset value per
share. These classes are offered exclusively to participants in certain
employee benefit plans and other programs. As of August 1, 2003, Class Z
shares of the New Century Fund and the Growth and Income Fund are no longer
being offered for sale. Effective February 23, 2004, Class I shares of the
New Century Fund are no longer being offered for sale.
Each class of shares bears the same voting, dividend, liquidation and other
rights and conditions. Class A, Class B and Class C shares each make
distribution and account maintenance and service fee payments under the
distribution plans pursuant to Rule 12b-1 under the Investment Company Act
of 1940 (the "Act"), except that Class B and Class C shares are subject to
higher distribution fee rates. There are no distribution payments applicable
to Class I, Class Z and Class X.
Indemnifications: Under the Trust's organizational documents, its officers
and trustees are indemnified against certain liability arising out of the
performance of their duties to the Trust. In addition, in the normal course
of business the Trust enters into contracts that contain a variety of
representations and warranties which provide general indemnifications. The
Trust's maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Trust that have not yet
occurred. However, the Trust expects the risk of loss to be remote.
Note 2. Fund Mergers
Pursuant to a plan of reorganization approved by shareholders of the North
American Funds ("NA Funds") on November 7, 2001, all the assets and
liabilities of the determined NA Funds were transferred in a tax-free
exchange to a determined SunAmerica Mutual Fund ("SA Funds"). The details of
the reorganization transaction, which was consummated on November 16, 2001,
are set forth below.
The Balanced Assets Fund, the Blue Chip Growth Fund, the Growth
Opportunities Fund, and Growth and Income Fund acquired all of the assets
and liabilities of the North American Balanced Fund, the North American
Large Cap Growth Fund, the North American Mid Cap Growth Fund and the North
American Growth & Income Fund, respectively. In conjunction with the
reorganizations, the SA Funds are the surviving entities.
The SunAmerica Style Select Series, Inc. International Equity Portfolio,
("SA International Equity Portfolio") was reorganized into the SunAmerica
International Equity Fund ("International Equity Fund"), a newly created
portfolio of the SunAmerica Equity Funds. The International Equity Fund
acquired all of the assets and liabilities of the North American Global
Equity Fund ("NA Global Equity Fund"), the North American International
Equity Fund ("NA International Equity Fund") and the North American
International Small Cap Fund ("NA International Small Cap Fund"). In
conjunction with the reorganization, the SA International Equity Portfolio
is the surviving entity. However, based on accounting principles generally
accepted in the United States of America, from a financial reporting
standpoint, the SunAmerica Style Select Series, Inc. (subsequently renamed
SunAmerica Focused Series, Inc., on January 30, 2004) International Equity
Portfolio is the surviving entity in this reorganization.
The Value Fund (formerly, Multi-Cap Value Portfolio) acquired all of the
assets and liabilities of the North American Mid Cap Value Fund. In
conjunction with the reorganization, the Value Fund is the surviving entity.
All shares of the NA Funds Class A, Class B, Class C and Class I were
exchanged, tax free, for shares of the surviving SA Funds Class A, Class B,
Class II (subsequently renamed Class C on February 20, 2004) and Class I
shares, respectively.
48
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
Pursuant to a plan of reorganization approved by the shareholders of certain
SunAmerica Focused Series, Inc. Portfolios and certain SunAmerica Strategic
Series, Inc. Funds on January 30, 2004, all the Investment assets and
liabilities of the determined SunAmerica Focused Series, Inc. Portfolios and
the determined SunAmerica Strategic Series, Inc. Funds were transferred in a
tax-free exchange to a determined SunAmerica Equity Funds. The details of
the reorganization transactions, which was consummated on February 23, 2004,
are set forth below.
The SunAmerica Focused Series, Inc. Value Portfolio, the SunAmerica
Strategic Investment Series, Inc. Biotech/Health Fund and the SunAmerica
Strategic Investment Series, Inc. Tax Managed Equity Fund were reorganized
into the newly created SunAmerica Value Fund, Biotech/Health Fund and Tax
Managed Equity Fund in the SunAmerica Equity Funds. In addition, The
SunAmerica Equity Funds Focused Dividend Strategy Portfolio was reorganized
into the newly created Focused Dividend Strategy Portfolio in the SunAmerica
Focused Series, Inc.
Note 3. Significant Accounting Policies
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could
differ from these estimates. The following is a summary of the significant
accounting policies followed by the Trust in the preparation of their
financial statements:
Security Valuations: Stocks are generally valued based upon closing sales
prices reported on recognized securities exchanges. Securities listed on the
NASDAQ exchange are valued using the NASDAQ Official Closing Price ("NOCP").
Generally, the NOCP will be the last sale price unless the reported trade
for the securities is outside the range of the bid/ask price. In such cases,
the NOCP will be normalized to the nearer of the bid or ask price. For
listed securities having no sales reported and for unlisted securities, such
securities will be valued based upon the last reported bid price.
Nonconvertible bonds, debentures, other long-term debt securities, and
short-term securities with original or remaining maturities in excess of 60
days are valued at prices obtained for the day of valuation from a bond
pricing service of a major dealer in bonds when such prices are available;
however, in circumstances where the investment adviser deems it appropriate
to do so, an over-the-counter or exchange quotation at the mean of
representative bid or asked prices may be used. As of the close of regular
trading on the New York Stock Exchange, securities traded primarily on
securities exchanges outside the United States are valued at the last sale
price on such exchanges on the day of valuation, or if there is no sale on
the day of valuation, at the last-reported bid price. However, depending on
the foreign market, closing prices may be up to 15 hours old when they are
used to price the Fund's shares, and the Fund may determine that certain
closing prices are unreliable. This determination will be based on review of
a number of factors, including developments in foreign markets, the
performance of U.S. securities markets, and the performance of instruments
trading in U.S. markets that represent foreign securities and baskets of
foreign securities. If the Fund determines that closing prices do not
reflect the fair value of the securities, the Fund will adjust the previous
closing prices in accordance with pricing procedures approved by the Board
to reflect what it believes to be the fair value of the securities as of the
close of regular trading on the New York Stock Exchange. A Fund may also
fair value securities in other situations, for example, when a particular
foreign market is closed but the Fund is open. Futures contracts and options
traded on national securities exchanges are valued as of the close of the
exchange on which they are traded. Short-term securities with 60 days or
less to maturity are amortized to maturity based on their cost to the Trust
if acquired within 60 days of maturity or, if already held by the Trust on
the 60th day, are amortized to maturity based on the value determined on the
61st day. Securities for which quotations are not readily available, or if a
development/event occurs that may significantly impact the value of the
securities, then these securities may be fair valued as determined pursuant
to procedures adopted in good faith under the direction of the Trust's
Trustees.
Repurchase Agreements: Pursuant to exemptive relief granted by the
Securities and Exchange Commission, the Funds are permitted to participate
in joint repurchase agreement transactions with other affiliated investment
companies. The Funds, along with other affiliated registered investment
companies, transfer uninvested cash balances into a single joint account,
the daily aggregate balance of which is invested in one or more repurchase
agreements collateralized by U.S. Treasury or federal agency obligations.
The Funds' custodian takes possession of the collateral pledged for
investments in repurchase agreements. The underlying collateral is valued
daily on a mark to market basis to ensure that the value, including accrued
interest, is at least 102% of the repurchase price. In the event of default
of the obligation to repurchase, a Fund has the right to liquidate the
collateral and apply the proceeds in satisfaction of the obligation. If the
seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
49
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
As of March 31, 2004, the following Funds held an undivided interest in a
joint repurchase agreement with State Street Bank & Trust Co.:
Percentage Principal
Fund Interest Amount
- ---- ---------- ----------
Blue Chip Growth.................................. 1.16% $ 836,000
Growth Opportunities.............................. 2.39 1,721,000
New Century....................................... 8.00 5,762,000
Growth and Income................................. 0.20 144,000
Biotech/Health.................................... 9.39 6,764,000
As of such date, the repurchase agreement in that joint account and the
collateral therefore were as follows:
State Street Bank & Trust Co., dated March 31, 2004, bearing interest at a
rate of 0.92% per annum, with a principal amount of $72,011,000, a
repurchase price of $72,012,840 and a maturity date of April 1, 2004. The
repurchase agreement is collateralized by the following:
Interest Rate/ Maturity Principal
Type of Collateral Discount Yield Date Amount Market Value
- ------------------ -------------- -------- ----------- ------------
U.S. Treasury Bills...... 0.92% 05/06/04 $20,430,000 $20,404,463
U.S. Treasury Bills...... 0.93 06/10/04 12,280,000 12,255,440
U.S. Treasury Notes...... 6.88 05/15/06 17,995,000 20,403,523
U.S. Treasury Notes...... 4.63 05/15/06 18,920,000 20,405,239
In addition, at March 31, 2004, the following Funds held an undivided
interest in a joint repurchase agreement with UBS Warburg, LLC:
Percentage Principal
Interest Amount
---------- ----------
Blue Chip Growth.................................. 1.33% $2,000,000
New Century....................................... 5.33 8,000,000
As of such date, the repurchase agreement in that joint account and the
collateral therefore were as follows:
UBS Warburg, LLC, dated March 31, 2004, bearing interest at a rate of .99%
per annum, with a principal amount of $150,000,000 a repurchase price of
$150,004,125, and a maturity date of April 1, 2004. The repurchase agreement
is collateralized by the following:
Maturity Principal
Type of Collateral Interest Rate Date Amount Market Value
- ------------------ ------------- ---------- ------------ ------------
U.S. Treasury Inflation Index
Notes........................ 3.00% 07/15/2012 $130,075,000 $153,003,320
Securities Transactions, Investment Income, Expenses, Dividends and
Distributions to Shareholders: Security transactions are recorded on a trade
date basis. Realized gains and losses on sales of investments are calculated
on the identified cost basis. Interest income is recorded on the accrual
basis. Dividend income is recorded on the ex-dividend date except for
certain dividends from foreign securities, which are recorded as soon as the
Fund is informed after the ex-dividend date. Funds which earn income and
capital gains may be subject to foreign withholding taxes and capital gains
taxes at various rates. Under applicable foreign law, a withholding of tax
may be imposed on interest, dividends, and capital gains at various rates.
India, Thailand, and certain other countries tax regulations require that
taxes be paid on capital gains realized by the Funds. For financial
statements purposes, the Funds amortize all premiums and accrete all
discounts on fixed income securities.
Net investment income, other than class-specific expenses, and realized and
unrealized gains and losses, are allocated daily to each class of shares
based upon the relative net asset value of outstanding shares of each class
of shares at the beginning of the day (after adjusting for the current
capital shares activity of the respective class).
50
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
Expenses common to all Funds, not directly related to individual Funds, are
allocated among the Equity Funds based upon their relative net asset value
or other appropriate methods. In all other respects, expenses are charged to
each Fund as incurred on a specific identification basis. Interest earned on
cash balances held at the custodian are shown as custody credits on the
statement of operations.
Dividends from net investment income, if any, are paid annually, except for
the Balanced Assets Fund and Growth and Income Fund, which pay quarterly.
Capital gain distributions, if any, are paid at least annually.
The Funds record dividends and distributions to their shareholders on the
ex-dividend date. The amount of dividends and distributions from net
investment income and net realized capital gains are determined and
presented in accordance with federal income tax regulations, which may
differ from accounting principles generally accepted in the United States of
America. These "book/tax" differences are either considered temporary or
permanent in nature. To the extent these differences are permanent in
nature, such amounts are reclassified within the capital accounts at fiscal
year end based on their federal tax-basis treatment; temporary differences
do not require reclassification. Net investment income (loss), net realized
gain (loss) and net assets are not affected.
Each Fund intends to comply with the requirements of the Internal Revenue
Code, as amended, applicable to regulated investment companies and to
distribute all of their net income to their shareholders. Therefore, no
federal income tax or excise tax provisions are required. Each Fund is
considered a separate entity for tax purposes.
Investment Securities Loaned: For the period ended March 31, 2004, the
Balanced Assets Fund participated in securities lending with qualified
brokers. In lending portfolio securities to brokers the Fund receives cash
as collateral against the loaned securities, which must be maintained at not
less than 102% of the market value of the loaned securities during the
period of the loan. The Fund may use the cash collateral received to invest
in short-term investments which earn interest income or to cover bank
overdrafts. Any interest earned from the investment of the collateral is
recorded by the Funds net of the portion of interest that is rebated to the
borrowing broker. If the amounts are used to cover bank overdrafts, the
broker rebates incurred are reflected as interest expense on the Statement
of Operations. During the period ended March 31, 2004, $474 of broker
rebates were reclassified to interest expense. As with other extensions of
credit, should the borrower of the securities fail financially, the Fund may
bear the risk of delay in recovery or may be subject to replacing the loaned
securities by purchasing them with the cash collateral held, which may be
less than 100% of the market value of such securities at the time of
replacement. As of March 31, 2004, the Balanced Assets Fund did not have any
securities on loan.
Foreign Currency Translation: The books and records of the Funds are
maintained in U.S. dollars. Assets and liabilities denominated in foreign
currencies are translated into U.S. dollars based on the exchange rate of
such currencies against U.S. dollars on the date of valuation.
The Funds do not isolate that portion of the results of operations arising
as a result of changes in the foreign exchange rates from the changes in the
market prices of securities held at the end of the period. Similarly, the
Funds do not isolate the effect of changes in foreign exchange rates from
the changes in the market prices of portfolio securities sold during the
period.
Realized foreign exchange gains and losses on other assets and liabilities
and change in unrealized foreign exchange gains and losses on other assets
and liabilities include foreign exchange gains and losses from currency
gains or losses between the trade and settlement dates of securities
transactions, the difference between the amounts of interest, dividends and
foreign withholding taxes recorded on the Funds' books and the U.S. dollar
equivalent amounts actually received or paid and changes in the unrealized
foreign exchange gains and losses relating to other assets and liabilities
arising as a result of changes in the exchange rate.
Forward Foreign Currency Contracts: Certain portfolios may enter into
forward foreign currency contracts ("forward contracts") to attempt to
protect securities and related receivables and payables against changes in
future foreign exchange rates or to enhance return. A forward contract is an
agreement between two parties to buy or sell currency at a set price on a
future date. The market value of the contract will fluctuate with changes in
currency exchange rates. The contract is marked to market daily using the
forward rate and the change in market value is recorded by the Portfolio as
unrealized gain or loss. On settlement date, the Portfolio records realized
foreign exchange gains or losses when the contract is closed equal to the
difference between
51
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
the value of the contract at the time it was opened and the value at the
time it was closed. Risks may arise upon entering into these contracts from
the potential inability of counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar. Forward contracts involve elements of
risk in excess of the amounts reflected in the Statement of Assets and
Liabilities. The Fund bears the risk of an unfavorable change in the foreign
exchange rate underlying the forward contract.
Futures Contracts: A futures contract is an agreement between two parties to
buy and sell a financial instrument at a set price on a future date. Upon
entering into such a contract the Funds are required to pledge to the broker
an amount of cash or U.S. government securities equal to the minimum
"initial margin" requirements of the exchange on which the futures contract
is traded. The Funds' activities in futures contracts are for hedging
purposes and are conducted through regulated exchanges which do not result
in counterparty credit risks. A Fund's participation in the futures market
involves certain risks, including imperfect correlation between movements in
the price of futures contracts and movements in the price of the securities
hedged or used for cover. Pursuant to a contract the Funds agree to receive
from or pay to the broker an amount of cash equal to the daily fluctuation
in value of the contract. Such receipts or payments are known as "variation
margin" and are recorded by the Funds as unrealized appreciation or
depreciation. When a contract is closed, the Funds record a realized gain or
loss equal to the difference between the value of the contract at the time
it was opened and the value at the time it was closed. Futures contracts
involve elements of risk in excess of the amount reflected in the Statement
of Assets and Liabilities. At March 31, 2004, there were no open future
contracts.
Options: An option is a contract conveying a right to buy or sell a
financial instrument at a specified price during a stipulated period. The
premium paid by a Fund for the purchase of a call or a put option is
included in the Fund's Statement of Assets and Liabilities as an investment
and subsequently marked to market to reflect the current market value of the
option. When a Fund writes a call or a put option, an amount equal to the
premium received by the Fund is included in the Fund's Statement of Assets
and Liabilities as a liability and is subsequently marked to market to
reflect the current market value of the option written. If an option which
the Fund has written either expires on its stipulated expiration date, or if
the Fund enters into a closing purchase transaction, the Fund realizes a
gain (or loss if the cost of a closing purchase transaction exceeds the
premium received when the option was written) without regard to any
unrealized gain or loss on the underlying security, and the liability
related to such options is extinguished. If a call option which the Fund has
written is exercised, the Fund realizes a capital gain or loss from the sale
of the underlying security and the proceeds from such sale are increased by
the premium originally received. If a put option which the Fund has written
is exercised, the amount of the premium originally received reduces the cost
of the security which the Fund purchased upon exercise of the option.
Transactions in call and put options written during the period ended March
31, 2004 for the New Century Fund are summarized as follows:
Written Options
-------------------
Number of Premiums
Contracts Received
--------- ---------
Beginning of period.................. -- $ --
Written.............................. (1,718) (377,174)
Closed............................... 1,718 404,023
Expired.............................. -- --
Exercised............................ -- --
Net realized gain on options closed.. -- (26,849)
------ ---------
End of period........................ -- $ --
====== =========
Short Sales: The Funds may sell a security it does not own in anticipation
of a decline in the market value of that security (short sales). To complete
such a transaction, the Fund must borrow the security to make delivery to
the buyer. The Fund then is obligated to replace the security borrowed by
purchasing it at market price at the time of replacement. The price at such
time may be more or less than the price at which the security was sold by
the Fund. Until the security is replaced, the Fund is required to pay to the
lender any dividends or interest that accrues during the period of the loan.
To borrow the security, the Fund may be required to pay a premium, which
would increase the cost of the security sold. The proceeds of the short sale
will be retained by the broker, to the extent necessary to meet margin
requirements, until the short position is closed out. Until the Fund
replaces a
52
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
borrowed security, the Fund will maintain daily a segregated account,
containing cash or liquid securities, at such a level that (i) the amount
deposited in the account plus the amount deposited with the broker as
collateral will equal the current value of the security sold short and (ii)
the amount deposited in the segregated account plus the amount deposited
with the broker as collateral will not be less than the market value of the
security at the time it was sold short. Liabilities for securities sold
short are reported at market value in the financial statements. Such
liabilities are subject to off balance sheet risk to the extent of any
future increases in market value of the securities sold short. The ultimate
liability for securities sold short could exceed the liabilities recorded in
the Statement of Assets and Liabilities. The Fund bears the risk of
potential inability of the broker to meet their obligation to perform.
Note 4. Investment Advisory and Management Agreement, Distribution Agreement
and Service Agreement
The Trust, on behalf of each Fund, has an Investment Advisory and Management
Agreement (the "Agreement") with SAAMCo. Under the Agreement, SAAMCo
provides continuous supervision of a Fund's portfolio and administers its
corporate affairs, subject to general review by the Trustees. In connection
therewith, SAAMCo furnishes the Funds with office facilities, maintains
certain of the Funds' books and records, and pays the salaries and expenses
of all personnel, including officers of the Funds who are employees of
SAAMCo and its affiliates. The investment advisory and management fee paid
to SAAMCo for Blue Chip Growth Fund, Growth Opportunities Fund, New Century
Fund, Growth and Income Fund and Balanced Assets Fund is computed daily and
payable monthly, at an annual rate of .75% of a Fund's average daily net
assets up to $350 million, .70% of the next $350 million, and .65%
thereafter. The rate for the International Equity Fund is 1.00% of the
Fund's average daily net assets. The annual rate for the Value Fund is 1.00%
for the first $750 million, 0.95% for the next $750 million, and 0.90% for
any amount exceeding 1.5 billion of the average daily net assets. The annual
rate for the Biotech/Health Fund and the Tax Managed Equity Fund is 0.75%
and 0.85%, respectively, of the average daily net assets. For the period
ended March 31, 2004, SAAMCo earned fees in the amounts stated on the
Statement of Operations. The International Equity Fund is subadvised by AIG
Global Investment Corp. ("AIGGIC") pursuant to a subadvisory agreement with
SAAMCo. AIGGIC is an indirect wholly-owned subsidiary of AIG and an
affiliate of SAAMCo. AIGGIC receives an annual fee of 0.47% of the average
daily net assets of the Fund, which is paid by SAAMCo. The Value Fund is
subadvised by American Century. American Century receives an annual fee of
0.46% of the average daily net assets of the Fund, which is paid by SAAMCo.
The Tax Managed Equity Fund is subadvised by J.P. Morgan Fleming Asset
Management, Inc. and receives an annual fee of 0.45% of the average daily
net assets of the Fund, which is paid by SAAMCo.
SAAMCo has contractually agreed to waive fees or reimburse expenses, if
necessary, at or below the following percentages of each Fund's average net
assets.
Fund Percentage
---- ----------
Blue Chip Growth Class I....... 1.33%
Growth Opportunities Class I... 1.33
New Century Class I............ 1.33
Growth and Income Class I...... 1.33
Balanced Assets Class I........ 1.33
International Equity Class A... 1.90
International Equity Class B... 2.55
International Equity Class C+.. 2.55
International Equity Class I... 1.80
Value Class A.................. 1.78
Value Class B.................. 2.43
Value Class C+................. 2.43
Value Class I.................. 1.68
Value Class Z.................. 1.21
Biotech/Health Class A......... 1.55
Biotech/Health Class B......... 2.20
Biotech/Health Class C+........ 2.20
Tax Managed Class A............ 1.45
Tax Managed Class B............ 2.10
Tax Managed Class C+........... 2.10
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
53
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
SAAMCo has voluntarily agreed to waive fees or reimburse expenses, if
necessary, at or below the following percentages of each Fund's average net
assets.
Fund Percentage
---- ----------
Growth Opportunities Class X.. 1.20%
New Century Class C+.......... 2.14
For the International Equity Fund, Value Fund, Biotech/Health Fund, and Tax
Managed Fund, any waivers or reimbursements made by SAAMCo are subject to
recoupment from the Funds within the following two years of such waivers or
reimbursements, provided that the Funds are able to effect such payment to
SAAMCo and remain in compliance with the foregoing expense limitations.
For the period ending March 31, 2004, SAAMCo has agreed to reimburse
expenses as follows:
Blue Chip Growth Class I.................................... $ 6,406
Growth Opportunities Class I................................ 5,170
New Century Fund Class C+................................... 7,067
New Century Fund Class I.................................... 5,223
Growth and Income Class I................................... 4,412
Balanced Assets Class I..................................... 4,637
International Equity Class A................................ 25,160
International Equity Class B................................ 25,107
International Equity Class C+............................... 14,874
International Equity Class I................................ 5,775
Value Fund Class A.......................................... 2,545
Value Fund Class I.......................................... 432
Value Fund Class Z.......................................... 8,520
Biotech/Health Class A...................................... 14,207
Biotech/Health Class B...................................... 16,553
Biotech/Health Class C+..................................... 12,709
Tax Managed Equity Class A.................................. 15,195
Tax Managed Equity Class B.................................. 22,506
Tax Managed Equity Class C+................................. 21,812
For the period ended March 31, 2004, expenses previously waived or
reimbursed by SunAmerica that are subject to recoupment are as follows:
Other
Expenses
Reimbursed
----------
International Equity........................................ $ --
Value Fund.................................................. --
Biotech/Health.............................................. --
Tax Managed Equity.......................................... --
Class
Specific
Expenses
Reimbursed
----------
International Equity Class A................................ $103,960
International Equity Class B................................ 71,514
International Equity Class C+............................... 75,656
International Equity Class I................................ 47,521
Value Fund Class A.......................................... 4,479
Value Fund Class B.......................................... --
Value Fund Class C+......................................... 8,873
Value Fund Class I.......................................... 8,981
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
54
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
Class
Specific
Expenses
Reimbursed
----------
Value Fund Class Z.......................................... 48,563
Biotech/Health Class A...................................... 85,551
Biotech/Health Class B...................................... 91,275
Biotech/Health Class C+..................................... 80,115
Tax Managed Equity Class A.................................. 86,042
Tax Managed Equity Class B.................................. 120,045
Tax Managed Equity Class C+................................. 122,081
For the period November 01, 2003 through March 31, 2004, the amounts repaid
per the recoupment agreement to the Advisor which are included in the
Investment advisory and management fees on the Statement of Operations are
as follows:
Amount
Recouped
--------
Value Fund Class A.......................................... $8,465
Value Fund Class C+......................................... 2,151
Value Fund Class I.......................................... 399
+ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
The Trust, on behalf of each Fund, has a Distribution Agreement with AIG
SunAmerica Capital Services, Inc. ("SACS"), an affiliate of the Adviser.
Each Fund has adopted a Distribution Plan (the "Plan") in accordance with
the provisions of Rule 12b-1 under the 1940 Act. Rule 12b-1 permits an
investment company directly or indirectly to pay expenses associated with
the distribution of its shares ("distribution expenses") in accordance with
a plan adopted by the investment company's board of trustees and approved by
its shareholders. Pursuant to such rule, the Trustees and the shareholders
of each class of shares of each Fund have adopted Distribution Plans
hereinafter referred to as the "Class A Plan", "Class B Plan" and "Class C
Plan". In adopting the Distribution Plans, the Trustees determined that
there was a reasonable likelihood that each such Plan would benefit the Fund
and the shareholders of the respective class.
Under the Class A Plan, Class B Plan and Class C Plan, the Distributor
receives payments from a Fund at an annual rate of up to 0.10%, 0.75% and
0.75%, respectively, of average daily net assets of such Fund's Class to
compensate the Distributor and certain securities firms for providing sales
and promotional activities for distributing that class of shares. The
distribution costs for which the Distributor may be compensated for include
fees paid to broker-dealers that have sold Fund shares, commissions and
other expenses such as those incurred for sales literature, prospectus
printing and distribution and compensation to wholesalers. It is possible
that in any given year the amount paid to the Distributor under each Class'
Plan may exceed the Distributor's distribution costs as described above. The
Distribution Plans provide that each class of shares of each Fund may also
pay the Distributor an account maintenance and service fee up to an annual
rate of 0.25% of the aggregate average daily net assets of such class of
shares for payments to broker-dealers for providing continuing account
maintenance. Accordingly, for the period ended March 31, 2004, SACS received
fees (see Statement of Operations) based upon the aforementioned rates.
In addition, SACS is paid a fee of 0.25% of average daily net assets of
Class I shares in connection with providing additional shareholder services
to Class I shareholders. For the period ended March 31, 2004, SACS earned
fees (see Statement of Operations) based upon the aforementioned rates.
SACS receives sales charges on each Fund's Class A and Class C shares,
portions of which are reallocated to affiliated broker-dealers and
non-affiliated broker-dealers. Effective February 23, 2004, the front-end
sales charge for Class C is no longer in effect. SACS also receives the
proceeds of contingent deferred sales charges paid by investors in
connection with certain redemptions of each Fund's Class A, Class B and
Class C shares. SACS has advised the Funds that for the period ended March
31, 2004, the proceeds received from sales (and paid out to affiliated and
non-affiliated broker-dealers) and redemptions are as follows:
55
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
Class A Class B
---------------------------------------------------- -------------
Contingent Contingent
Sales Affiliated Non-affiliated Deferred Deferred
Charges Broker-dealers Broker-dealers Sales Charges Sales Charges
-------- -------------- -------------- ------------- -------------
Blue Chip Growth Fund......... $ 35,067 $ 17,996 $12,168 $ -- $28,405
Growth Opportunities Fund..... 75,630 25,913 37,871 -- 76,650
New Century Fund.............. 36,946 19,971 12,130 -- 12,553
Growth and Income Fund........ 69,547 32,237 19,920 -- 93,874
Balanced Assets Fund.......... 178,632 112,362 41,861 -- 69,400
International Equity Fund..... 27,807 5,773 17,973 -- 22,062
Value Fund+................... 117,517 60,362 38,480 -- 54,498
Biotech/Health Fund+.......... 64,264 14,352 40,508 -- 42,303
Tax Managed Equity Fund+...... 6,305 2,583 2,248 -- 43,428
Class C++
----------------------------------------------------
Contingent
Sales Affiliated Non-affiliated Deferred
Charges Broker-dealers Broker-dealers Sales Charges
-------- -------------- -------------- -------------
Blue Chip Growth Fund......... $ 2,711 $ 932 $ 1,779 $ 266
Growth Opportunities Fund..... 2,933 1,117 1,816 583
New Century Fund.............. 361 143 218 28
Growth and Income Fund........ 6,487 1,912 4,575 2,158
Balanced Assets Fund.......... 7,365 2,758 4,607 3,574
International Equity Fund..... 4,779 1,476 3,303 695
Value Fund+................... 18,155 3,678 14,477 3,665
Biotech/Health Fund+.......... 5,464 2,319 3,145 431
Tax Managed Equity Fund+...... 5,280 673 4,607 596
The Trust has entered into a Service Agreement with AIG SunAmerica Fund
Services, Inc. ("SAFS"), an affiliate of the Adviser. Under the Service
Agreement, SAFS performs certain shareholder account functions by assisting
the Funds' transfer agent in connection with the services that it offers to
the shareholders of the Funds. The Service Agreement, which permits the
Funds to compensate SAFS for services rendered based upon an annual rate of
0.22% of average daily net assets, is approved annually by the Trustees. For
the period ended March 31, 2004, the Funds incurred the following expenses
which are included in transfer agent fees payable in the Statement of Asset
and Liabilities and in transfer agent fees and expenses in the Statement of
Operations to compensate SAFS pursuant to the terms of the Service Agreement.
Expense Payable At March 31, 2004
------------------------------------------ -----------------------------------------
Fund Class A Class B Class C++ Class I Class X Class A Class B Class C++ Class I Class X
- ---- -------- ------- --------- ------- ------- ------- ------- --------- ------- -------
Blue Chip Growth Fund................... $ 77,631 $35,463 $ 8,565 $17,287 $ -- $12,846 $ 5,975 $1,421 $ 586 $ --
Growth Opportunities Fund............... 71,247 44,609 22,342 5,421 13,028 11,866 7,442 3,680 946 2,531
New Century Fund........................ 97,852 17,088 2,499 4,513 -- 15,908 2,621 407 -- --
Growth and Income Fund.................. 82,865 73,755 56,553 12,245 -- 13,928 11,927 9,337 350 --
Balanced Assets Fund.................... 195,878 52,169 28,627 3,836 -- 32,420 8,545 4,749 608 --
International Equity Fund............... 35,717 30,484 18,158 21,757 -- 6,220 5,078 3,100 1,432 --
Value Fund+............................. 59,944 77,791 22,463 6,727 -- 13,068 15,341 4,652 1,452 --
Biotech/Health Fund+.................... 18,262 16,806 11,948 -- -- 3,794 3,453 2,466 -- --
Tax Managed Equity Fund+................ 13,983 20,996 20,722 -- -- 2,812 4,190 4,117 -- --
+ For the period November 01, 2003 through March 31, 2004.
++ Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
56
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
As of March 31, 2004, the Variable Annuity Life Insurance Company ('VALIC'),
an indirectly wholly owned subsidiary of AIG, held more than five percent of
the outstanding shares of the following Funds' classes:
Fund VALIC
- ---- -----
Blue Chip Growth Fund Class I................ 33%
Growth Opportunities Fund Class I............ 21
Growth and Income Fund Class I............... 55
Balanced Asset Fund Class I.................. 75
International Equity Fund Class A............ 7
International Equity Fund Class B............ 7
International Equity Fund Class I............ 59
Value Fund Class I........................... 36
On February 10, 2004, the advisor for the Growth Opportunities Fund,
purchased 40,000 shares of iShares Russell 2000 Growth Index Fund
representing 1.70% of the Fund's net assets, causing the total iShares
Russell 2000 Growth Index Fund investment to exceed 5.00% of net assets. The
Fund has an investment restriction that states the Fund may not exceed 5.00%
of net assets in a single investment company. The iShares Russell 2000
Growth Index Fund is considered to be an investment company. On April 05,
2004, the advisor disposed of 25,000 shares to bring the Fund into
compliance. As of March 31, 2004, $33,000 of unrealized appreciation
applicable to the 25,000 shares which were sold April 05, 2004, is included
on the Statement of Assets and Liabilities.
Note 5. Purchases and Sales of Investment Securities
The cost of purchases and proceeds from sales and maturities of long-term
investments during the period ended March 31, 2004 were as follows:
Blue Chip Growth New Growth and Balanced
Growth Opportunities Century Income Assets
Fund Fund Fund Fund Fund
------------- ------------- ----------- ------------ ------------
Purchases (excluding U.S. government securities)............. $ 94,397,865 $136,713,470 $33,299,823 $166,270,919 $185,120,157
Sales and maturities (excluding U.S. government securities).. 120,380,163 122,693,825 66,945,437 200,902,711 193,778,778
Purchases of U.S. government securities...................... -- -- -- -- 99,762,341
Sales and maturities of U.S. government securities........... -- -- -- -- 109,644,619
Tax
International Biotech/ Managed
Equity Value Health Equity
Fund Fund+ Fund+ Fund+
------------- ------------- ----------- ------------
Purchases (excluding U.S. government securities)............. $ 97,881,925 $ 85,737,391 $39,254,943 $ 7,023,250
Sales and maturities (excluding U.S. government securities).. 117,154,714 78,670,993 30,593,692 12,708,373
Purchases of U.S. government securities...................... -- -- -- --
Sales and maturities of U.S. government securities........... -- -- -- --
+ For the period November 01, 2003 through March 31, 2004.
57
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
Note 6. Federal Income Taxes
The amounts of aggregate unrealized gain (loss) and the cost of investment
securities for federal tax purposes, including short-term securities and
repurchase agreements, were as follows:
Growth New
Blue Chip Opportunities Century Growth and Balanced
Growth Fund Fund Fund Income Fund Assets Fund
------------- ------------- ----------- ------------ ------------
Cost (tax basis)............................ $104,059,194 $128,005,079 $82,839,577 $172,375,529 $234,921,644
============ ============ =========== ============ ============
Appreciation................................ $ 10,973,694 $ 17,599,398 $20,404,712 $ 19,202,275 $ 16,557,439
Depreciation................................ (3,680,839) (3,865,294) (1,429,184) (4,082,410) (4,868,781)
------------ ------------ ----------- ------------ ------------
Net unrealized appreciation (depreciation).. $ 7,292,855 $ 13,734,104 $18,975,528 $ 15,119,865 $ 11,688,658
============ ============ =========== ============ ============
International Biotech/ Tax Managed
Equity Fund Value Fund Health Fund Equity Fund
------------- ------------- ----------- ------------
Cost (tax basis)............................ $ 77,329,001 $180,866,748 $39,587,879 $ 59,371,236
============ ============ =========== ============
Appreciation................................ $ 9,981,160 $ 14,976,965 $ 9,811,555 $ 7,037,887
Depreciation................................ (1,466,993) (4,573,096) (1,051,896) (7,568,058)
------------ ------------ ----------- ------------
Net unrealized appreciation (depreciation).. $ 8,514,167 $ 10,403,869 $ 8,759,659 $ (530,171)
============ ============ =========== ============
The tax basis components of distributable earnings differ from the amounts
reflected in the Statement of Assets and Liabilities due to temporary
book/tax differences primarily arising from wash sales, post October losses,
investments in passive foreign investment companies and derivative
transactions. Also included in the tables below are the capital loss
carryforwards at September 30, 2003.
Distributable Earnings Tax Distributions
---------------------------------------- ---------------------
For the year ended September 30, 2003
---------------------------------------------------------------
Long-term Gains/ Unrealized Long-term
Ordinary Capital Loss Appreciation Ordinary Capital
Income Carryover (Depreciation Income Gains
---------- ---------------- ------------- ---------- ----------
Blue Chip Growth Fund...... $ -- $ (95,747,926) $ 4,932,432 $ -- $ --
Growth Opportunities Fund.. -- (237,869,603) 10,921,057 -- --
New Century Fund........... -- (145,971,301) 19,104,199 -- --
Growth and Income Fund..... -- (94,689,968) 4,296,534 -- --
Balanced Assets Fund....... 137,892 (107,118,737) 4,691,416 2,088,794 --
International Equity Fund.. 28,461 (71,403,293) 6,859,774 -- --
Value Fund+................ 7,451,020 -- 7,174,581 4,305,100 2,019,911
Biotech/Health Fund+....... -- (36,097,343) 7,134,660 -- --
Tax Managed Equity Fund+... -- (30,923,844) (5,525,690) -- --
+For the period November 1, 2002 through October 31, 2003.
Tax Distributions
------------------------
For the year ended
September 31, 2002
------------------------
Ordinary Long-term
Income Capital Gains
---------- -------------
Blue Chip Growth Fund.... $ -- $ --
Growth Opportunities Fund -- --
New Century Fund......... -- --
Growth and Income Fund... -- --
Balanced Assets Fund..... -- --
International Equity Fund -- --
Value Fund+.............. 5,165,336 2,447,955
Biotech/Health Fund+..... -- --
Tax Managed Equity Fund+. -- --
+For the period November 1, 2001 through October 31, 2002.
58
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (continued)
Note 7. Capital Share Transactions
Transactions in capital shares of each class of each fund were as follows:
Blue Chip Growth Fund
-------------------------------------------------
Class A
-------------------------------------------------
For the
period ended For the
March 31, 2004 year ended
(unaudited) September 30, 2003
---------------------- -------------------------
Shares Amount Shares Amount
-------- ------------ ---------- ------------
Shares sold.............. 541,466* $ 7,616,012* 667,646** $ 8,164,351**
Reinvested dividends..... -- -- -- --
Shares redeemed.......... (759,094) (10,926,137) (1,100,613) (13,344,907)
-------- ------------ ---------- ------------
Net increase (decrease).. (217,628) $ (3,310,125) (432,967) $ (5,180,556)
======== ============ ========== ============
Blue Chip Growth Fund
-------------------------------------------------
Class C(1)
-------------------------------------------------
For the
period ended For the
March 31, 2004 year ended
(unaudited) September 30, 2003
---------------------- -------------------------
Shares Amount Shares Amount
-------- ------------ ---------- ------------
Shares sold.............. 50,255 $ 648,315 212,883 $ 2,355,419
Reinvested dividends..... -- -- -- --
Shares redeemed.......... (87,116) (1,137,868) (354,083) (3,888,325)
-------- ------------ ---------- ------------
Net increase (decrease).. (36,861) $ (489,553) (141,200) $ (1,532,906)
======== ============ ========== ============
Growth Opportunities Fund
-------------------------------------------------
Class A
-------------------------------------------------
For the
period ended For the
March 31, 2004 year ended
(unaudited) September 30, 2003
---------------------- -------------------------
Shares Amount Shares Amount
-------- ------------ ---------- ------------
Shares sold.............. 309,664+ $ 4,641,691+ 1,789,798++ $ 20,911,843++
Reinvested dividends..... -- -- -- --
Shares redeemed.......... (759,991) (11,338,394) (2,237,193) (25,721,737)
-------- ------------ ---------- ------------
Net increase (decrease).. (450,327) $ (6,696,703) (447,395) $ (4,809,894)
======== ============ ========== ============
Blue Chip Growth Fund
------------------------------------------------------
Class B
------------------------------------------------------
For the
period ended For the
March 31, 2004 year ended
(unaudited) September 30, 2003
------------------------- --------------------------
Shares Amount Shares Amount
---------- ------------ ---------- ------------
Shares sold.............. 209,778 $ 2,744,239 546,397 $ 6,073,302
Reinvested dividends..... -- -- -- --
Shares redeemed.......... (333,436)* (4,354,157)* (1,063,759)** (11,736,666)**
---------- ------------ ---------- ------------
Net increase (decrease).. (123,658) $ (1,609,918) (517,362) $ (5,663,364)
========== ============ ========== ============
Blue Chip Growth Fund
------------------------------------------------------
Class I
------------------------------------------------------
For the
period ended For the
March 31, 2004 year ended
(unaudited) September 30, 2003
------------------------- --------------------------
Shares Amount Shares Amount
---------- ------------ ---------- ------------
Shares sold.............. 119,051 $ 1,800,315 624,237 $ 7,468,473
Reinvested dividends..... -- -- -- --
Shares redeemed.......... (1,401,711) (20,900,986) (519,967) (6,253,415)
---------- ------------ ---------- ------------
Net increase (decrease).. (1,282,660) $(19,100,671) 104,270 $ 1,215,058
========== ============ ========== ============
Growth Opportunities Fund
------------------------------------------------------
Class B
------------------------------------------------------
For the
period ended For the
March 31, 2004 year ended
(unaudited) September 30, 2003
------------------------- --------------------------
Shares Amount Shares Amount
---------- ------------ ---------- ------------
Shares sold.............. 148,912 $ 2,009,120 1,129,240 $ 12,028,932
Reinvested dividends..... -- -- -- --
Shares redeemed.......... (431,448)+ (5,827,836)+ (1,652,186)++ (17,373,362)++
---------- ------------ ---------- ------------
Net increase (decrease).. (282,536) $ (3,818,716) (522,946) $ (5,344,430)
========== ============ ========== ============
* Includes automatic conversion of 73,426 shares of Class B shares in the
amount of $938,563 to 66,529 shares of Class A shares in the amount of
$938,563.
** Includes automatic conversion of 246,929 shares of Class B shares in the
amount of $2,761,911 to 224,890 shares of Class A shares in the amount of
$2,761,911.
+ Includes automatic conversion of 28,051 shares of Class B shares in the
amount of $374,745 to 25,330 shares of Class A shares in the amount of
$374,745.
++ Includes automatic conversion of 162,597 shares of Class B shares in the
amount of $1,733,132 to 147,591 shares of Class A shares in the amount of
$1,733,132.
(1) Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
59
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (continued)
Growth Opportunities Fund
-------------------------------------------------------------------------------------------------------
Class C(1) Class I
------------------------------------------------- ---------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
---------------------- ------------------------- ---------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
-------- ------------ ---------- ------------ -------- ----------- ---------- ------------
Shares sold...... 57,440 $ 770,211 468,787 $ 4,976,058 25,775 $ 388,955 46,134 $ 542,776
Reinvested
dividends....... -- -- -- -- -- -- -- --
Shares redeemed.. (252,337) (3,401,931) (796,853) (8,347,567) (17,526) (267,782) (32,299) (371,452)
-------- ------------ ---------- ------------ -------- ----------- ---------- ------------
Net increase
(decrease)...... (194,897) $ (2,631,720) (328,066) $ (3,371,509) 8,249 $ 121,173 13,835 $ 171,324
======== ============ ========== ============ ======== =========== ========== ============
Growth Opportunities Fund
-------------------------------------------------
Class X
-------------------------------------------------
For the
period ended For the
March 31, 2004 year ended
(unaudited) September 30, 2003
---------------------- -------------------------
Shares Amount Shares Amount
-------- ------------ ---------- ------------
Shares sold...... 242,599 $ 3,664,931 527,450 $ 6,247,340
Reinvested
dividends....... -- -- -- --
Shares redeemed.. (98,265) (1,429,463) (35,347) (427,960)
-------- ------------ ---------- ------------
Net increase
(decrease)...... 144,334 $ 2,235,468 492,103 $ 5,819,380
======== ============ ========== ============
New Century Fund
-------------------------------------------------------------------------------------------------------
Class A Class B
------------------------------------------------- ---------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
---------------------- ------------------------- ---------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
-------- ------------ ---------- ------------ -------- ----------- ---------- ------------
Shares sold...... 338,528* $ 4,884,133* 1,352,573** $ 16,310,269** 73,513 $ 949,004 343,848 $ 3,680,626
Reinvested
dividends....... -- -- -- -- -- -- -- --
Shares redeemed.. (934,888) (13,583,051) (1,636,627) (19,570,318) (365,750)* (4,708,583)* (1,308,484)** (14,067,218)**
-------- ------------ ---------- ------------ -------- ----------- ---------- ------------
Net increase
(decrease)...... (596,360) $ (8,698,918) (284,054) $ (3,260,049) (292,237) $(3,759,579) (964,636) $(10,386,592)
======== ============ ========== ============ ======== =========== ========== ============
New Century Fund
-------------------------------------------------------------------------------------------------------
Class C(1) Class I+
------------------------------------------------- ---------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
---------------------- ------------------------- ---------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
-------- ------------ ---------- ------------ -------- ----------- ---------- ------------
Shares sold...... 9,221 $ 118,548 52,648 $ 567,386 23,471 $ 366,941 146,603 $ 1,709,295
Reinvested
dividends....... -- -- -- -- -- -- -- --
Shares redeemed.. (23,263) (303,197) (113,537) (1,196,408) (362,040) (5,505,570) (108,317) (1,267,459)
-------- ------------ ---------- ------------ -------- ----------- ---------- ------------
Net increase
(decrease)...... (14,042) $ (184,649) (60,889) $ (629,022) (338,569) $(5,138,629) 38,286 $ 441,836
======== ============ ========== ============ ======== =========== ========== ============
* Includes automatic conversion of 195,560 shares of Class B shares in the
amount of $2,521,962 to 174,717 shares of Class A shares in the amount of
$2,521,962.
** Includes automatic conversion of 703,950 shares of Class B shares in the
amount of $7,667,059 to 630,746 shares of Class A shares in the amount of
$7,667,059.
+ See Note 1
(1) Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
60
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (continued)
New Century Fund
------------------------
Class Z#
------------------------
For the
year ended
September 30, 2003
------------------------
Shares Amount
---------- ------------
Shares sold...... 7,199 $ 86,274
Reinvested
dividends....... -- --
Shares redeemed.. (110,192) (1,310,376)
---------- ------------
Net increase
(decrease)...... (102,993) $ (1,224,102)
========== ============
Growth and Income Fund
------------------------------------------------------------------------------------------------------------
Class A Class B
--------------------------------------------------- ------------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
------------------------ ------------------------- ------------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
---------- ------------ ---------- ------------ ---------- ------------ ---------- ------------
Shares sold...... 681,641+ $ 7,591,736+ 1,683,730++ $ 16,391,477++ 289,938 $ 3,100,062 604,185 $ 5,578,360
Reinvested
dividends....... -- -- -- -- -- -- -- --
Shares redeemed.. (1,104,086) (12,355,017) (2,785,695) (26,551,456) (1,344,416)+ (14,262,449)+ (3,370,139)++ (30,761,446)++
---------- ------------ ---------- ------------ ---------- ------------ ---------- ------------
Net increase
(decrease)...... (422,445) $ (4,763,281) (1,101,965) $(10,159,979) (1,054,478) $(11,162,387) (2,765,954) $(25,183,086)
========== ============ ========== ============ ========== ============ ========== ============
Growth and Income Fund
------------------------------------------------------------------------------------------------------------
Class C(1) Class I
--------------------------------------------------- ------------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
------------------------ ------------------------- ------------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
---------- ------------ ---------- ------------ ---------- ------------ ---------- ------------
Shares sold...... 125,901 $ 1,321,886 363,022 $ 3,318,644 112,404 $ 1,320,900 533,327 $ 5,022,032
Reinvested
dividends....... -- -- -- -- -- -- -- --
Shares redeemed.. (662,344) (7,011,655) (2,331,541) (21,041,757) (1,206,658) (14,114,928) (382,061) (3,601,108)
---------- ------------ ---------- ------------ ---------- ------------ ---------- ------------
Net increase
(decrease)...... (536,443) $ (5,689,769) (1,968,519) $(17,723,113) (1,094,254) $(12,794,028) 151,266 $ 1,420,924
========== ============ ========== ============ ========== ============ ========== ============
Growth and Income Fund
------------------------
Class Z#
------------------------
For the
year ended
September 30, 2003
------------------------
Shares Amount
---------- ------------
Shares sold...... 6,055 $ 58,677
Reinvested
dividends....... -- --
Shares redeemed.. (39,596) (377,391)
---------- ------------
Net increase
(decrease)...... (33,541) $ (318,714)
========== ============
# See Note 1
+ Includes automatic conversion of 388,173 shares of Class B shares in the
amount of $4,098,668 to 368,409 shares of Class A shares in the amount of
$4,098,668.
++ Includes automatic conversion of 972,591 shares of Class B shares in the
amount of $9,107,456 to 926,892 shares of Class A shares in the amount of
$9,107,456.
(1) Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
61
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (continued)
Balanced Assets Fund
--------------------------------------------------------------------------------------------------------------
Class A Class B
----------------------------------------------------- ------------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
------------------------ --------------------------- ------------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Shares sold...... 691,926# $ 9,094,392# 2,020,442## $ 24,213,183## 237,229 $ 3,116,494 582,863 $ 6,983,307
Reinvested
dividends....... 66,604 882,373 137,761 1,658,350 6,476 85,618 14,987 176,868
Shares redeemed.. (1,892,011) (24,979,825) (3,661,431) (43,869,345) (683,891)# (8,975,165)# (2,257,809)## (26,844,252)##
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Net increase
(decrease)...... (1,133,481) $(15,003,060) (1,503,228) $ (17,997,812) (440,186) $ (5,773,053) (1,659,959) $(19,684,077)
========== ============ =========== ============= ========== ============ ========== ============
Balanced Assets Fund
--------------------------------------------------------------------------------------------------------------
Class C(1) Class I
----------------------------------------------------- ------------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
------------------------ --------------------------- ------------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Shares sold...... 105,556 $ 1,392,750 193,805 $ 2,323,311 129,306 $ 1,676,869 38,539 $ 464,642
Reinvested
dividends....... 3,564 47,162 7,634 90,206 1,390 18,435 4,178 50,394
Shares redeemed.. (287,751) (3,785,460) (838,430) (9,991,677) (253,664) (3,288,786) (53,657) (640,288)
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Net increase
(decrease)...... (178,631) $ (2,345,548) (636,991) $ (7,578,160) (122,968) $ (1,593,482) (10,940) $ (125,252)
========== ============ =========== ============= ========== ============ ========== ============
International Equity Fund
--------------------------------------------------------------------------------------------------------------
Class A Class B
----------------------------------------------------- ------------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
------------------------ --------------------------- ------------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Shares sold...... 481,657* $ 4,736,052* 30,503,819** $ 227,514,952** 348,895 $ 3,219,028 389,373 $ 2,904,734
Reinvested
dividends....... 1,103 10,629 -- -- -- -- -- --
Shares redeemed.. (485,755) (4,831,701) (31,630,035) (238,270,504) (567,050)* (5,435,485)* (1,208,986)** (8,867,590)**
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Net increase
(decrease)...... (2,995) $ (85,020) (1,126,216) $ (10,755,552) (218,155) $ (2,216,457) (819,613) $ (5,962,856)
========== ============ =========== ============= ========== ============ ========== ============
International Equity Fund
--------------------------------------------------------------------------------------------------------------
Class C(1) Class I
----------------------------------------------------- ------------------------------------------------------
For the For the
period ended For the period ended For the
March 31, 2004 year ended March 31, 2004 year ended
(unaudited) September 30, 2003 (unaudited) September 30, 2003
------------------------ --------------------------- ------------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Shares sold...... 164,488 $ 1,538,108 1,468,920 $ 10,367,805 395,162 $ 3,902,514 2,122,992 $ 16,282,171
Reinvested
dividends....... -- -- -- -- 1,799 17,397 -- --
Shares redeemed.. (228,401) (2,168,159) (1,938,357) (13,930,858) (1,970,417) (21,000,869) (2,036,526) (15,779,996)
---------- ------------ ----------- ------------- ---------- ------------ ---------- ------------
Net increase
(decrease)...... (63,913) $ (630,051) (469,437) $ (3,563,053) (1,573,456) $(17,080,958) 86,466 $ 502,175
========== ============ =========== ============= ========== ============ ========== ============
# Includes automatic conversion of 156,431 shares of Class B shares in the
amount of $2,050,734 to 155,708 shares of Class A shares in the amount of
$2,050,734.
## Includes automatic conversion of 843,098 shares of Class B shares in the
amount of $10,050,519 to 839,286 shares of Class A shares in the amount of
$10,050,519.
* Includes automatic conversion of 146,352 shares of Class B shares in the
amount of $1,424,368 to 139,563 shares of Class A shares in the amount of
$1,424,368.
** Includes automatic conversion of 262,760 shares of Class B shares in the
amount of $1,918,130 to 250,009 shares of Class A shares in the amount of
$1,918,130.
(1) Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
62
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (continued)
Value Fund#
--------------------------------------------------------------------------------
Class A
--------------------------------------------------------------------------------
For the five months ended
March 31, 2004 For the year ended For the year ended
(unaudited) October 31, 2003 October 31, 2002
----------------------- -------------------------- ------------------------
Shares Amount Shares Amount Shares Amount
-------- ------------ ---------- ------------ ---------- ------------
Shares sold................ 898,344+ $ 15,086,361+ 1,250,958++ $ 18,840,328++ 1,281,563 $ 19,781,901
Shares issued by merger##.. -- -- -- -- 222,667 3,547,219
Reinvested dividends....... 165,970 2,706,977 148,209 2,134,200 159,249 2,431,740
Shares redeemed............ (512,858) (8,613,366) (1,166,737) (17,494,094) (1,566,274) (24,197,581)
-------- ------------ ---------- ------------ ---------- ------------
Net increase (decrease).... 551,456 $ 9,179,972 232,430 $ 3,480,434 97,205 $ 1,563,279
======== ============ ========== ============ ========== ============
Value Fund#
--------------------------------------------------------------------------------
Class B
--------------------------------------------------------------------------------
For the five months ended
March 31, 2004 For the year ended For the year ended
(unaudited) October 31, 2003 October 31, 2002
----------------------- -------------------------- ------------------------
Shares Amount Shares Amount Shares Amount
-------- ------------ ---------- ------------ ---------- ------------
Shares sold................ 267,743 $ 4,332,398 790,880 $ 11,373,716 854,532 $ 12,737,305
Shares issued by merger##.. -- -- -- -- 679,054 10,431,946
Reinvested dividends....... 211,580 3,326,044 190,506 2,649,945 225,310 3,327,829
Shares redeemed............ (915,293)+ (14,796,158)+ (1,219,512)++ (17,398,128)++ (1,504,713) (22,144,087)
-------- ------------ ---------- ------------ ---------- ------------
Net increase (decrease).... (435,970) $ (7,137,716) (238,126) $ (3,374,467) 254,183 $ 4,352,993
======== ============ ========== ============ ========== ============
Value Fund#
--------------------------------------------------------------------------------
Class C(1)
--------------------------------------------------------------------------------
For the five months ended
March 31, 2004 For the year ended For the year ended
(unaudited) October 31, 2003 October 31, 2002
----------------------- -------------------------- ------------------------
Shares Amount Shares Amount Shares Amount
-------- ------------ ---------- ------------ ---------- ------------
Shares sold................ 148,934 $ 2,401,290 543,767 $ 7,827,633 335,996 $ 5,021,580
Shares issued by merger##.. -- -- -- -- 278,658 4,280,036
Reinvested dividends....... 58,785 924,693 46,488 646,641 58,720 867,290
Shares redeemed............ (161,645) (2,612,867) (427,255) (6,130,918) (580,375) (8,574,128)
-------- ------------ ---------- ------------ ---------- ------------
Net increase (decrease).... 46,074 $ 713,116 163,000 $ 2,343,356 92,999 $ 1,594,778
======== ============ ========== ============ ========== ============
Value Fund#
--------------------------------------------------------------------------------
Class I
--------------------------------------------------------------------------------
For the five months ended For the period
March 31, 2004 For the year ended November 16, 2001*
(unaudited) October 31, 2003 through October 31, 2002
----------------------- -------------------------- ------------------------
Shares Amount Shares Amount Shares Amount
-------- ------------ ---------- ------------ ---------- ------------
Shares sold................ 47,785 $ 805,506 94,391 $ 1,425,042 65,902 $ 1,018,521
Shares issued by merger##.. -- -- -- -- 753,772 12,008,384
Reinvested dividends....... 21,805 355,230 15,108 217,404 14,156 216,021
Shares redeemed............ (10,812) (182,153) (26,620) (405,802) (510,776) (8,153,349)
-------- ------------ ---------- ------------ ---------- ------------
Net increase (decrease).... 58,778 $ 978,583 82,879 $ 1,236,644 323,054 $ 5,089,577
======== ============ ========== ============ ========== ============
# See Note 1
## See Note 2
+ Includes automatic conversion of 450,879 shares of Class B shares in the
amount of $7,287,353 to 434,240 shares of Class A shares in the amount of
$7,287,353.
++ Includes automatic conversion of 56,417 shares of Class B shares in the
amount of $794,436 to 54,465 shares of Class A shares in the amount of
$794,436.
* Inception of the class
(1) Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
63
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (continued)
Value Fund#
---------------------------------------------------------------------------
Class Z
---------------------------------------------------------------------------
For the five months ended
March 31, 2004 For the year ended For the year ended
(unaudited) October 31, 2003 October 31, 2002
---------------------- ----------------------- -----------------------
Shares Amount Shares Amount Shares Amount
-------- ----------- -------- ----------- ---------- -----------
Shares sold................ 76,309 $ 1,314,646 268,453 $ 3,953,345 28,434 $ 466,899
Shares issued by merger##.. -- -- -- -- -- --
Reinvested dividends....... 15,301 255,534 1,192 17,449 1,606 24,991
Shares redeemed............ (47,771) (826,305) (23,150) (355,897) (37,566) (610,768)
-------- ----------- -------- ----------- ---------- -----------
Net increase (decrease).... 43,839 $ 743,875 246,495 $ 3,614,897 (7,526) $ (118,878)
======== =========== ======== =========== ========== ===========
Biotech/Health Fund#
---------------------------------------------------------------------------
Class A
---------------------------------------------------------------------------
For the five months ended
March 31, 2004 For the year ended For the period ended
(unaudited) October 31, 2003 October 31, 2002
---------------------- ----------------------- -----------------------
Shares Amount Shares Amount Shares Amount
-------- ----------- -------- ----------- ---------- -----------
Shares sold................ 280,391* $ 2,903,892* 456,700** $ 3,940,808** 646,970 $ 6,336,427
Reinvested dividends....... -- -- -- -- -- --
Shares redeemed............ (287,433) (2,994,737) (639,968) (5,253,782) (1,062,148) (9,526,931)
-------- ----------- -------- ----------- ---------- -----------
Net increase (decrease).... (7,042) $ (90,845) (183,268) $(1,312,974) (415,178) $(3,190,504)
======== =========== ======== =========== ========== ===========
Biotech/Health Fund#
---------------------------------------------------------------------------
Class B
---------------------------------------------------------------------------
For the five months ended
March 31, 2004 For the year ended For the period ended
(unaudited) October 31, 2003 October 31, 2002
---------------------- ----------------------- -----------------------
Shares Amount Shares Amount Shares Amount
-------- ----------- -------- ----------- ---------- -----------
Shares sold................ 89,233 $ 902,216 504,910 $ 4,524,190 572,460 $ 5,712,976
Reinvested dividends....... -- -- -- -- -- --
Shares redeemed............ (178,965)* (1,807,466)* (746,314)** (6,389,961)** (810,536) (7,339,560)
-------- ----------- -------- ----------- ---------- -----------
Net increase (decrease).... (89,732) $ (905,250) (241,404) $(1,865,771) (238,076) $(1,626,584)
======== =========== ======== =========== ========== ===========
Biotech/Health Fund#
---------------------------------------------------------------------------
Class C(1)
---------------------------------------------------------------------------
For the five months ended
March 31, 2004 For the year ended For the period ended
(unaudited) October 31, 2003 October 31, 2002
---------------------- ----------------------- -----------------------
Shares Amount Shares Amount Shares Amount
-------- ----------- -------- ----------- ---------- -----------
Shares sold................ 78,822 $ 793,310 211,434 $ 1,825,147 339,378 $ 3,284,100
Reinvested dividends....... -- -- -- -- -- --
Shares redeemed............ (121,887) (1,227,618) (551,787) (4,263,083) (838,133) (7,689,471)
-------- ----------- -------- ----------- ---------- -----------
Net increase (decrease).... (43,065) $ (434,308) (340,353) $(2,437,936) (498,755) $(4,405,371)
======== =========== ======== =========== ========== ===========
# See Note 1
## See Note 2
* Includes automatic conversion of 10,883 shares of Class B shares in the
amount of $109,172 to 10,625 shares of Class A shares in the amount of
$109,172.
** Includes automatic conversion of 21,973 shares of Class B shares in the
amount of $178,278 to 21,668 shares of Class A shares in the amount of
$178,278.
(1) Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
64
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (continued)
Tax Managed Equity Fund#
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
For the five months
ended March 31, 2004 For the year ended For the period ended
(unaudited) October 31, 2003 October 31, 2003
---------------------- ----------------------- ------------------------
Shares Amount Shares Amount Shares Amount
-------- ----------- -------- ----------- ---------- ------------
Shares sold.............. 51,007+ $ 556,084+ 70,444++ $ 672,205++ 255,825 $ 2,796,384
Reinvested dividends..... -- -- -- -- -- --
Shares redeemed.......... (129,391) (1,448,368) (494,385) (4,600,304) (1,016,375) (10,481,262)
-------- ----------- -------- ----------- ---------- ------------
Net increase (decrease).. (78,384) $ (892,284) (423,941) $(3,928,099) (760,550) $ (7,684,878)
======== =========== ======== =========== ========== ============
Tax Managed Equity Fund#
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
For the five months
ended March 31, 2004 For the year ended For the year ended
(unaudited) October 31, 2003 October 31, 2002
---------------------- ----------------------- ------------------------
Shares Amount Shares Amount Shares Amount
-------- ----------- -------- ----------- ---------- ------------
Shares sold.............. 46,988 $ 500,353 74,626 $ 688,358 341,922 $ 3,766,020
Reinvested dividends..... -- -- -- -- -- --
Shares redeemed.......... (236,252)+ (2,543,770)+ (768,187)++ (6,967,422)++ (1,167,526) (11,638,648)
-------- ----------- -------- ----------- ---------- ------------
Net increase (decrease).. (189,264) $(2,043,417) (693,561) $(6,279,064) (825,604) $ (7,872,628)
======== =========== ======== =========== ========== ============
Tax Managed Equity Fund#
----------------------------------------------------------------------------
Class C(1)
----------------------------------------------------------------------------
For the five months
ended March 31, 2004 For the year ended For the year ended
(unaudited) October 31, 2003 October 31, 2002
---------------------- ----------------------- ------------------------
Shares Amount Shares Amount Shares Amount
-------- ----------- -------- ----------- ---------- ------------
Shares sold.............. 43,865 $ 466,462 168,595 $ 1,555,227 319,412 $ 3,458,869
Reinvested dividends..... -- -- -- -- -- --
Shares redeemed.......... (302,844) (3,224,803) (910,268) (8,270,207) (1,331,221) (13,791,589)
-------- ----------- -------- ----------- ---------- ------------
Net increase (decrease).. (258,979) $(2,758,341) (741,673) $(6,714,980) (1,011,809) $(10,332,720)
======== =========== ======== =========== ========== ============
# See Note 1
+ Includes automatic conversion of 2,289 shares of Class B shares in the
amount of $24,372 to 2,214 shares of Class A shares in the amount of
$24,372.
++ Includes automatic conversion of 5,175 shares of Class B shares in the
amount of $49,538 to 5,051 shares of Class A shares in the amount of
$49,538.
(1) Effective February 23, 2004, Class II shares were redesignated to Class C
shares.
65
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
Note 8. Commitments and Contingencies
The SunAmerica Family of Mutual Funds has established a $75 million
committed and $50 million uncommitted lines of credit with State Street Bank
and Trust Company, the Funds' custodian. Interest is currently payable at
the Federal Funds Rate plus 50 basis points on the committed line and State
Street Bank and Trust Company's discretionary bid rate on the uncommitted
line of credit. There is also a commitment fee of 10 basis points per annum
on the daily unused portion of the committed line of credit which is
included in other expenses on the statement of operations. Borrowings under
the line of credit will commence when the respective Fund's cash shortfall
exceeds $100,000. For the period ended March 31, 2004, the following Funds
had borrowings:
Weighted
Days Interest Average Debt Average
Outstanding Charges Utilized Interest
----------- -------- ------------ --------
Blue Chip Growth Fund...... 8 $1,447 $4,281,481 1.52
New Century Fund .......... 61 6,489 2,514,687 1.53
Growth and Income Fund..... 45 4,615 2,429,352 1.52
Balanced Assets Fund....... 23 996 1,015,842 1.53
International Equity Fund.. 39 3,796 2,307,818 1.53
For the period ended March 31, 2004, the Balanced Assets Fund had $151,217
in borrowings outstanding at an interest rate of 1.56%.
Pursuant to exemptive relief granted by the Securities and Exchange
Commission, the Funds are permitted to participate in an interfund lending
program among investment companies advised by SAAMCo or an affiliate. The
interfund lending program allows the participating Funds to borrow money
from and loan money to each other for temporary or emergency purposes. An
interfund loan will be made under this facility only if the participating
Funds receive a more favorable interest rate than would otherwise be
available from a typical bank for a comparable transaction. For the period
ending March 31, 2004 none of the Funds participated in this program.
Note 9. Transactions with Affiliates:
As disclosed in the portfolio of investments, certain Funds own common stock
issued by American International Group, Inc. ("AIG") or an affiliate
thereof. During the period ended March 31, 2004, the following Funds
recorded realized gains (losses) and income on security transactions of AIG
and subsidiaries of AIG as follows:
Market Market
Value at Value at
October 31, Realized Unrealized March 31,
Security Income 2003 Purchases Sales Gain (Loss) Gain (Loss) 2004
--------------------------------- ------ ----------- --------- ----- ----------- ----------- ---------
Tax Managed Equity Fund American International Group Inc. $1,505 $704,411 $-- $-- $-- $15,124 $826,233
Note 10. Trustees Retirement Plan
The Trustees of the SunAmerica Equity Funds have adopted the AIG SunAmerica
Disinterested Trustees' and Directors' Retirement Plan (the "Retirement
Plan") effective January 1, 1993 for the unaffiliated Trustees. The
Retirement Plan provides generally that if an unaffiliated Trustee who has
at least 10 years of consecutive service as a Disinterested Trustee of any
of the SunAmerica mutual funds (an "Eligible Trustee") retires after
reaching age 60 but before age 70, or who has at least 5 years of
consecutive service after reaching age 65 but before 70, or dies while a
Trustee, such person will be eligible to receive a retirement or death
benefit from each SunAmerica mutual fund with respect to which he or she is
an Eligible Trustee. As of each birthday, prior to the 70th birthday, but in
no event for a period greater than 10 years, each Eligible Trustee will be
credited with an amount equal to 50% of his or her regular fees (excluding
committee fees) for services as a Disinterested Trustee of each SunAmerica
mutual fund for the calendar year in which such birthday occurs. In
addition, an amount equal to 8.5% of any amounts credited under the
preceding clause during prior years is added to each Eligible Trustee's
account until such Eligible Trustee reaches his or her 70th birthday. An
Eligible Trustee may receive any benefits payable under the Retirement Plan,
at his or her election, either in one lump sum or in up to fifteen annual
installments.
66
SunAmerica Equity Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2004 -- (unaudited)
(continued)
The following amounts for the Retirement Plan Liabilities are included in
the Accrued Expenses on the Statement of Assets and Liabilities and the
Amounts for the Retirement Plan Expenses are included in the Trustees' fees
on the Statement of Operations.
Retirement Retirement Retirement
Plan Plan Plan
Liability Expense Payments
---------- ---------- ----------
As of March 31, 2004
--------------------------------
Blue Chip Growth Fund...... $32,047 $2,058 $ 625
Growth Opportunities Fund.. 25,784 2,083 447
New Century Fund........... 53,566 1,822 1,114
Growth and Income Fund..... 39,259 3,761 626
Balanced Assets Fund....... 91,466 4,640 1,855
International Equity Fund.. 17,984 1,617 320
Value Fund................. 28,583 2,108 478
Biotech/Health Fund........ 4,773 559 62
Tax Managed Equity Fund.... 10,409 800 148
Note 11. Investment Concentration
Some of the Portfolios may invest internationally, including in "emerging
market" countries. These securities may be denominated in currencies other
than U.S. dollars. While investing internationally may reduce your risk by
increasing the diversification of your investment, the value of your
investment may be affected by fluctuating currency values, changing local
and regional economic, political and social conditions, and greater market
volatility. In addition, foreign securities may not be as liquid as domestic
securities. These risks are primary risks of the International Equity Fund.
At March 31, 2004, the International Equity Fund had approximately 23% and
19% of its net assets invested in equity securities of companies domiciled
in Japan and United Kingdom, respectively.
67
SunAmerica Equity Funds
TRUSTEE INFORMATION -- (unaudited)
The following table contains basic information regarding the Trustees that
oversee operations of the Portfolios and other investment companies within the
SunAmerica Mutual Funds complex.
Number of
Term of Portfolios in
Position Office and Fund Other
Name, Held With Length of Complex Directorships
Address and SunAmerica Time Principal Occupations Overseen by Held by
Date of Birth* Complex Served(4) During Past 5 Years Trustee(1) Trustee(2)
- -------------- ----------- ------------ -------------------------------- ------------- -------------------------
Jeffrey S. Burum(5) Trustee 2004-Present Founder and CEO of National 32 None
DOB: February 27, 1963 Housing Development Corp.
S. James Coppersmith(5) Trustee 1986-2004 Retired. 41 Director of BJ'S
DOB: February 21, 1933 Wholesale Club, Inc.;
Director, Boston Stock
Exchange.
Dr. Judith L. Craven Trustee 2001-Present Retired. 70 Director, A.G. Belo
DOB: October 6, 1945 Corporation (1992 to
present); Director, Sysco
Corporation (1996 to
present); Director,
Luby's, Inc. (1998 to
present).
William F. Devin Trustee 2001-Present Retired. 70 Member of the Board of
DOB: December 30, 1938 Governors, Boston Stock
Exchange (1985-Present).
Samuel M. Eisenstat Chairman of 1986-Present Attorney, solo practitioner. 42 Director, North European
DOB: March 7, 1940 the Board Oil Royalty Trust.
Stephen J. Gutman Trustee 1986-Present Partner and Member of 42 None
DOB: May 10, 1943 Managing Directors, Beau
Brummel-Soho LLC (Licensing
of menswear specialty retailing
and other activities) (June 1988
to present)
Peter A. Harbeck(3) Trustee 1995-Present President, CEO and Director, 79 None
DOB: January 23, 1954 SAAMCo. (August 1995 to
present); Director, AIG
SunAmerica Capital Services,
Inc. ("SACS") (August 1993 to
present)
Sebastiano Sterpa(5) Trustee 1993-2004 Founder and Chairman of the 32 Director, Real Estate
DOB: July 18, 1929 Board of the Sterpa Group (Real Business Service and
Estate Investment and CountryWide Financial.
Management) (1962 to Present)
68
SunAmerica Equity Funds
TRUSTEE INFORMATION -- (unaudited) (continued)
- --------
* The business address for each Trustee is the Harborside Financial Center,
3200 Plaza 5, Jersey City, NJ 07311-4992.
(1) The "Fund Complex" consists of all registered investment company portfolios
for which SAAMCo serves as investment adviser or business manager. The
"Fund Complex" includes the SunAmerica Money Market Funds (2 funds),
SunAmerica Equity Funds (9 funds), SunAmerica Income Funds (6 funds),
SunAmerica Focused Series, Inc. (15 portfolios), Anchor Series Trust (9
portfolios), SunAmerica Senior Floating Rate Fund, Inc. (1 fund),
SunAmerica Series Trust (32 portfolios), VALIC Company I (22 portfolios),
VALIC Company II (15 funds), and Seasons Series Trust (19 portfolios).
(2) Directorships of companies required to report to the Securities and
Exchange Commission under the Securities Exchange Act of 1934 (i.e. "public
companies") or other investment companies registered under the Investment
Company Act of 1940.
(3) Interested Trustee, as defined within the Investment Company Act of 1940.
(4) Trustees serve until their successors are duly elected and qualified,
subject to the Trustee's retirement plan as discussed in Note 10 of the
financial statements.
(5) Effective on February 23, 2004, S. James Coppersmith and Sebastiano Sterpa
retired as trustees and Jeffrey S. Burum began serving as trustee.
Additional information concerning the Trustees is contained in the Statement of
Additional Information and is available without charge by calling (800)
858-8850.
69
SunAmerica Equity Funds
SPECIAL MEETING OF SHAREHOLDERS -- Proxy Voting Results -- March 31,
2004 (unaudited)
A special Meeting of Shareholders of SunAmerica Equity Funds was held on
January 30, 2004. The Fund voted in favor of adopting the following proposals.
1. To elect as Directors/Trustees the following nominees:
Jeffrey S. Burum
Votes in favor....... 52,742,518
Votes withheld....... 827,485
Dr. Judith L. Craven
Votes in favor....... 52,756,774
Votes withheld....... 813,230
William F. Devin
Votes in favor....... 52,763,217
Votes withheld....... 806,786
Samuel M. Eisenstat
Votes in favor....... 52,761,252
Votes withheld....... 808,751
Stephen J. Gutman
Votes in favor....... 52,757,266
Votes withheld....... 812,737
Peter A. Harbeck
Votes in favor....... 52,737,457
Votes withheld....... 832,546
William J. Shea*
Votes in favor....... 52,742,351
Votes withheld....... 827,652
2. To approve the Agreement and Plan of Reorganization, pursuant to which the
Focused Dividend Strategy Portfolio of SunAmerica Equity Funds will be
reorganized into newly created Focused Dividend Strategy Portfolio of
SunAmerica Focused Series, Inc.
Votes in favor of the proposal.. 6,109,675
Votes Against the proposal...... 129,678
Votes Abstained................. 137,598
Broker Non-votes................ 2,259,219
* William J. Shea never assumed his position on the Board of Trustees.
70
[LOGO]
AIG SunAmerica
Mutual Funds
Harborside Financial Center
3200 Plaza 5
Jersey City, NJ 07311-4992
Directors/Trustees Investment Adviser This report is submitted
Samuel M. Eisenstat AIG SunAmerica Asset solely for the general
Peter A. Harbeck Management Corp. information of
Dr. Judith L. Craven Harborside Financial shareholders of the Fund.
William F. Devin Center Distribution of this
Stephen J. Gutman 3200 Plaza 5 report to persons other
Jeffrey S. Burum Jersey City, NJ than shareholders of
07311-4992 the Fund is authorized
Officers only in connection with a
Robert M. Zakem, Distributor currently effective
President AIG SunAmerica Capital prospectus, setting forth
Donna M. Handel, Services, Inc. details of the Fund,
Treasurer Harborside Financial which must precede or
Brian P. Clifford, Vice Center accompany this report.
President 3200 Plaza 5
Francis Gannon, Vice Jersey City, NJ The accompanying report
President 07311-4992 has not been audited by
J. Steven Neamtz, Vice independent
President Shareholder Servicing accountants and
Abbe P. Stein, Vice Agent accordingly no opinion
President AIG SunAmerica Fund has been expressed
and Assistant Secretary Services, Inc. thereon.
Joseph P. Kelly, Harborside Financial
Secretary Center VOTING PROXIES ON FUND
Stacey V. Morrison, 3200 Plaza 5 PORTFOLIO SECURITIES.
Assistant Secretary Jersey City, NJ A description of the
Gregory R. Kingston, 07311-4992 policies and procedures
Vice President and that the Trust uses to
Assistant Treasurer Custodian and Transfer determine how to vote
Donald H. Guire, Agent proxies relating to
Assistant Treasurer State Street Bank and securities held in the
Trust Company Fund's portfolio which is
P.O. Box 419572 available in the Trust's
Kansas City, MO Statement of Additional
64141-6572 Information, may be
obtained without charge
upon request, by calling
(800) 858-8850. This
information is also
available from the EDGAR
database on the
Securities and Exchange
Commission's Internet
site at
http://www.sec.gov.
Distributed by:
AIG SunAmerica Capital Services, Inc.
EQSAN-3/04
Item 2. Code of Ethics
Not applicable.
Item 3. Audit Committee Financial Expert.
Not applicable.
Item 4. Principal Accountant Fees and Services.
Not applicable.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 9. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 10. Controls and Procedures.
(a) An evaluation was performed within 90 days of the filing of this
report, under the supervision and with the participation of the
registrant's management, including the President and Treasurer, of the
effectiveness of the design and operation of the registrant's
disclosure controls and procedures. Based on that evaluation, the
registrant's management, including the President and Treasurer,
concluded that the registrant's disclosure controls and procedures are
effective.
(b) There was no change in the Registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act) that occurred during the Registrant's first fiscal
half-year that has materially affected, or is reasonably likely to
materially affect, the Registrant's internal contro1 over financial
reporting.
Item 11. Exhibits.
(a) (1) Not applicable.
(2) Certification pursuant to Rule 30a-2 under the Investment Company
Act of 1940 (17 CFR 270.30a-2) attached hereto as Exhibit 99.CERT.
(3) Not applicable.
(b) Certification pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 attached hereto as Exhibit 99.906.CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
SunAmerica Equity Funds
By: /s/ Robert M. Zakem
-------------------
Robert M. Zakem
President
Date: June 9, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Robert M. Zakem
-------------------
Robert M. Zakem
President
Date: June 9, 2004
By: /s/ Donna M. Handel
-------------------
Donna M. Handel
Treasurer
Date: June 9, 2004