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 811-05641
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The Park Avenue Portfolio
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(Exact name of registrant as specified in charter)
7 Hanover Square New York, N.Y. 10004
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(Address of principal executive offices) (Zip code)
Frank L. Pepe Thomas G. Sorell
The Park Avenue Portfolio The Park Avenue Portfolio
7 Hanover Square 7 Hanover Square
New York, N.Y. 10004 New York, N.Y. 10004
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(Name and address of agents for service)
Registrant's telephone number, including area code: (800) 221-3253
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Date of fiscal year end: December 31
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Date of reporting period: June 30, 2004
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ITEM 1. REPORTS TO STOCKHOLDERS.
The Semiannual Report to Stockholders follows.
(Guardian Logo)
The Park Avenue Portfolio(R)
Semiannual Report
to Shareholders
June 30, 2004
The Guardian Park Avenue Fund(R)
The Guardian UBS Large Cap Value Fund(SM)
The Guardian Park Avenue Small Cap Fund(SM)
The Guardian UBS Small Cap Value Fund(SM)
The Guardian Asset Allocation Fund(SM)
The Guardian S&P 500 Index Fund(SM)
The Guardian Baillie Gifford International Growth Fund(SM)*
The Guardian Baillie Gifford Emerging Markets Fund(SM)
The Guardian Investment Quality Bond Fund(SM)
The Guardian Low Duration Bond Fund(SM)
The Guardian High Yield Bond Fund(SM)
The Guardian Tax-Exempt Fund(SM)
The Guardian Cash Management Fund(SM)
*Formerly known as The Guardian Baillie Gifford International Fund
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Dear Shareholder:
[PHOTO]
Thomas G. Sorell
Thomas G. Sorell, C.F.A.
Chief Investment Officer
QUICK FACTS
.. Stocks posted meager returns during the first half of the year, while the
bond market was essentially flat.
.. The Fed officially began the process of moving away from an accommodative
monetary policy when it raised the target Fed Funds rate on June 30.
.. The Fed and investors are likely to closely follow inflation data to
determine the extent and pace of future rate hikes.
.. We believe that investors should consider gravitating to higher quality
stocks and bonds.
Concerns and Uncertainties Drive the Markets
The first two quarters of the year proved to be a study in contrasts. In the
first three months, investors questioned whether the strong economic expansion
that occurred in the latter half of 2003 was sustainable. While extensive
monetary and fiscal stimulus helped drive solid Gross Domestic Product (GDP)
growth in the first quarter 2004, a weak labor market led to fears of a
"jobless recovery." This proved to be the driving factor in the markets,
causing bond yields to fall and fixed income securities to outperform their
equity counterparts. (Gross Domestic Product measures the value of goods and
services produced in an economy).
Investor psychology then abruptly changed in the second quarter. In April,
the Labor Department reported that 308,000 new jobs were created in March,
significantly higher than expected. This was followed by impressive job growth
in April and May. Confidence grew that economic growth was sustainable as first
quarter 2004 GDP increased 3.9%. However, a series of economic reports
indicating increasing inflationary risks turned investor focus to concerns
about inflation and rising interest rates. The Fed eventually raised rates from
1.00% to 1.25% on June 30, the first such increase in four years.
The preoccupation with interest rates overshadowed strong corporate
fundamentals and the equity market rose only modestly during the second
quarter. Bond yields were sharply higher, especially in the short end of the
curve, as the market priced in a series of rate hikes. All told, the U.S. bond
market posted its worst quarterly return in a decade.
Looking at the first six months of the year, the S&P 500 Index gained 3.44%
and the Lehman Aggregate Bond Index returned 0.15%. Overseas, the MSCI EAFE
advanced 4.86%, emerging market equities, as measured by the MSCI EMF Free
Index fell 0.78%, and the JP Morgan Global Government Bond Index returned 0.41%.
(The S&P 500 Index is an index of 500 primarily large-cap U.S. stocks that is
generally considered to be representative of U.S. stock market activity. The
Lehman Brothers Aggregate Bond Index is generally considered to be
representative of U.S. bond market activity. The Morgan Stanley Capital
International (MSCI) Index for Europe, Australasia, and Far East (EAFE) is an
index that is generally considered to be representative of international stock
market activity. The JP Morgan Global Government Bond Index tracks total return
of government bonds in developed countries globally. The bonds included in the
index are weighted according to their market capitalization. The index is
unhedged and expressed in terms of $US. The S&P 500 Index, the Lehman Brothers
Aggregate Bond Index, the MSCI EAFE Index and the JP Morgan Global Government
Bond Index all are unmanaged indices that are not available for direct
investment. There are no expenses associated with the indexes.)
All Eyes on the Fed
Thus far, the Fed has been relatively forthcoming by telegraphing its policy
shifts as the economy has gained momentum. Key statements, such as "be patient
in removing its policy accommodation," "policy accommodation can be removed at
a pace that is likely to be measured," and "will respond to changes in economic
prospects as needed to fulfill its obligation to maintain price stability" have
been carefully scrutinized by market participants around the world.
We currently believe that the Fed will continue to institute 25 basis point
rate hikes during its regular meetings and that the Fed Funds rate will be 2.0-
21/4% by year-end. This has already been factored into short-term interest
rates. Given signs that inflation has already started to take hold, as
indicated by the rising CPI (The Consumer Price Indexes (CPI) program produces
monthly data on changes in the prices paid by urban consumers for a
representative basket of goods and services) and PPI (The Producer Price Index
(PPI) program measures the average change over time in the selling prices
received by domestic producers for their output), we believe that it is likely
that rates will continue to rise in 2005 as well. Should inflation remain
relatively under control, we believe the Fed will be able to maintain a
"measured pace" in raising rates.
Market Outlook
Now that we have a clear picture of the interest rate environment and the
official handover of power in Iraq is behind us, investors may set their sights
on the fundamental factors that generally drive the markets, namely the
macro-economic situation and corporate profits. However, just as the prospect
for rising rates overshadowed the markets in the second quarter, the outlook
for inflation will likely do the same in the coming months. Investors may also
be distracted as we get closer to the November presidential election.
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While the future is impossible to predict, we do know that corporate profits
currently remain strong. According to First Call, profit growth among the
companies in the S&P 500 Index was an exceptional 26% in the first quarter and
is projected to be roughly 22% in the second quarter. With a P/E of 17 times
forward earnings, the market is at the higher end of its historical range,
although not excessively so. We estimate that with 2004 GDP between 3 1/2-4%
and manageable inflation, it is possible that stocks could produce mid- to
upper single-digit returns by the end of the year. Lower profits or an
acceleration of inflation and Fed hikes would likely lower the returns for
stocks in the second half of 2004.
In terms of individual equities, we believe that investors who are suitable
for these securities should consider shifting their focus from more speculative
stocks into higher quality companies with predictable growth prospects, we
believe that these stocks should outperform during periods of rising interest
rates and declining earnings growth and we are beginning to see this trend
developing in the market.
Looking at the bond market, the Fed (and investors) will carefully monitor
upcoming inflation data to ascertain to what level--and how quickly--rates will
rise. With this tightening cycle likely to continue for quite some time, we
continue to believe that fixed income investors' coupon return will be
diminished by the decline in principal value, dependent on a bond's maturity.
Shorter-term bonds are likely to suffer less in principal losses as interest
rates rise.
Internationally, we expect economic growth in Asia will continue to be
strong, despite China's efforts to cool its economy and ward off inflation.
While European growth may strengthen in 2005, industry experts believe that it
will likely still lag other established economies. Given the mounting U.S.
trade deficit, we believe that the dollar should remain under pressure during
the second half of the year. This could provide a welcome boost in returns for
U.S. investors that hold foreign stock and bonds.
Reinforce the Benefits of Professional Advice
Given the unsettled market environment, we believe now is an ideal time to
proactively contact your financial advisor. When the markets are falling or
stagnant, it can be all too easy for investors to overreact. We believe this
situation actually represents a compelling opportunity for you to meet with
your financial advisor and carefully review your financial portfolios. In doing
so, you can determine whether your current asset allocation mix is appropriate
given your financial objectives and risk profile.
As you might notice, we updated the style of your semiannual report in order
to present fund information in an easier to read format. We thank you for your
business, confidence and trust to manage your investments and look forward to
serving your financial needs in the future.
/s/ Thomas G. Sorell
Thomas G. Sorell, CFA
President, The Park Avenue Portfolio
Chief Investment Officer,
Guardian Investor Services LLC
Please note that the opinions and outlooks about the markets in general and
any specific securities expressed in this issue reflect the viewpoints of Tom
Sorell as of July, 2004. Keep in mind that market conditions are constantly
evolving and that past performance is not a guarantee of future results. This
shareholder letter is not part of the funds' financial report and is submitted
for the general information of Park Avenue Portfolio shareholders. This letter
is not authorized for distribution to prospective investors unless preceded or
accompanied by a prospectus. Please consider the funds' investment objectives,
risks, fees and charges carefully before investing.
Shares of The Park Avenue Portfolio family of mutual funds are not deposits
or obligations of, or guaranteed or endorsed by, any bank or depository
institution, nor are they insured by the Federal Deposit Insurance Corporation
(FDIC), the National Credit Union Association (NCUA), the Federal Reserve
Board, or any other agency. Investment in the funds involves risks, including
possible loss of the principal amount invested. Fund shares are subject to
market fluctuations and, when redeemed, may be worth more or less than their
original cost.
Guardian Investor Services LLC (GIS) is the distributor of The Park Avenue
Portfolio family of mutual funds. GIS is an indirect wholly owned subsidiary of
The Guardian Life Insurance Company of America (Guardian Life), New York, NY.
GIS is located at 7 Hanover Square, New York, NY 10004. 800-221-3253 GIS is a
member: NASD, SIPC.
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THE PARK AVENUE PORTFOLIO
Table of Contents
Schedule
Fund of
Highlights Investments
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The Guardian Park Avenue Fund 2 15
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The Guardian UBS Large Cap Value Fund 3 17
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The Guardian Park Avenue Small Cap Fund 4 18
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The Guardian UBS Small Cap Value Fund 5 20
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The Guardian Asset Allocation Fund 6 22
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The Guardian S&P 500 Index Fund 7 25
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The Guardian Baillie Gifford International Growth Fund 8 31
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The Guardian Baillie Gifford Emerging Markets Fund 9 34
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The Guardian Investment Quality Bond Fund 10 37
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The Guardian Low Duration Bond Fund 11 41
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The Guardian High Yield Bond Fund 12 43
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The Guardian Tax-Exempt Fund 13 48
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The Guardian Cash Management Fund 14 50
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Financial Statements 52
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Notes to Financial Statements 61
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Financial Highlights 76
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About Your Semiannual Report
Information About Indexes:
Index returns are provided for comparative purposes and are quoted
throughout the following fund information. Please note that indices are not
available for direct investment and the returns do not reflect the fees and
expenses that have been deducted from the Fund. In addition, the return figures
for the index do not reflect sales charges that an investor may pay when
purchasing or redeeming shares of a Fund.
. The S&P 500 Index is an unmanaged index of 500 primarily large cap U.S.
stocks that is generally considered to be representative of U.S. stock
market activity.
. The Russell 1000 Value Index measures the performance of those Russell 1000
companies with lower price-to-book ratios and lower forecasted growth
values. The Russell 1000 Index measures the performance of the 1,000 largest
companies in the Russell 3000 Index. The Russell 1000 Index represents
approximately 92% of the total market capitalization of the Russell 3000
Index.
. The Russell 2000 Index is an unmanaged index that is generally considered to
be representative of small capitalization issues in the U.S. stock market.
. The Russell 2000 Value Index measures the performance of those Russell 2000
companies with lower price-to-book ratios and lower forecasted growth
values. The Russell 2000 Index measures the performance of the 2,000
smallest companies in the Russell 3000 Index. The Russell 2000 Index
represents approximately 8% of the total market capitalization of the
Russell 3000 Index.
. The Morgan Stanley Capital International (MSCI) Europe, Australasia and Far
East (EAFE) Growth Index is an unmanaged index that is generally considered
to be representative of the international growth stock market activity.
. The Morgan Stanley Capital International (MSCI) Emerging Markets Free (EMF)
Index is an unmanaged index that is generally considered to be
representative of the stock market activity of emerging markets. The MSCI
EMF Index is a market capitalization weighted index composed of companies
representative of the market structure of 22 emerging market countries of
Europe, Latin America and the Pacific Basin. The MSCI EMF Index excludes
closed markets and those shares in otherwise free markets that may not be
purchased by foreigners.
. The Lehman Brothers Aggregate Bond Index is an unmanaged index that is
generally considered to be representative of U.S. bond market activity.
. The Lehman Brothers U.S. Government 1-3 Year Bond Index is an unmanaged
index that is generally considered to be representative of U.S. short
duration bond market activity.
. The Lehman Brothers Corporate High Yield Bond Index is an unmanaged index
that is generally considered to be representative of U.S. corporate high
yield bond market activity.
. The Lehman Brothers Municipal Bond Index is an unmanaged index that is
generally considered to be representative of U.S. municipal bond activity.
. The Lehman Brothers 3-Month Treasury Bill Index is generally considered
representative of the average yield of three-month Treasury Bills.
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.. The Guardian Park Avenue Fund Semiannual Report To Shareholders
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[PHOTO]
Richard Goldman
Richard Goldman, Portfolio Manager
Objective:
Long-term growth of capital
Inception:
June 1, 1972
Net assets at June 30, 2004:
$1,205,651,147
Portfolio:
At least 80% common stocks and securities convertible into common stocks
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Top Ten Holdings (As of 6/30/04)
Percentage of
Company Total Net Assets
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Pfizer, Inc. 4.93%
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General Electric Co. 4.42%
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Microsoft Corp. 3.92%
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American Int'l. Group, Inc. 3.27%
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Procter & Gamble Co. 2.70%
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Devon Energy Corp. 2.66%
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Colgate-Palmolive Co. 2.62%
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Phelps Dodge Corp. 2.58%
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Cisco Systems, Inc. 2.39%
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Citigroup, Inc. 2.38%
Sector Weightings vs. Index (As of 6/30/04)
[CHART]
The Guardian Park Avenue Fund S&P 500 Index
Financials 21.60% 20.28%
Information Technology 18.20% 17.23%
Consumer Staples 14.40% 11.14%
Health Care 13.80% 13.31%
Energy 10.20% 6.57%
Industrials 10.10% 11.47%
Consumer Discretionary 5.50% 10.94%
Materials 3.50% 2.97%
Utilities 1.50% 2.67%
Telecommunication Services 0.80% 3.42%
Cash 0.40% 0.00%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
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Class A Shares (w/o sales charge) (6/1/72) 0.72 12.38 -4.36 -6.02 8.50 13.08
(w/ sales charge) (6/1/72) -3.81 7.32 -5.82 -6.88 8.00 12.92
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Class B Shares (w/o sales charge) (5/1/96) 0.28 11.28 -5.29 -6.90 -- 4.37
(w/ sales charge) (5/1/96) -2.72 8.28 -5.93 -7.09 -- 4.37
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Class C Shares (w/o sales charge) (8/7/00) 0.14 11.06 -5.50 -- -- -13.78
(w/ sales charge) (8/7/00) -0.86 10.06 -5.50 -- -- -13.78
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Class K Shares (w/o sales charge) (5/15/01) 0.60 12.07 -4.66 -- -- -5.60
(w/ sales charge) (5/15/01) -0.40 11.07 -4.66 -- -- -5.60
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S&P 500 Index 3.44 19.11 -0.69 -2.20 11.81 11.14
Since Class A
shares inception
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About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested.
.. Please see the "About Your Semiannual Report" page for a description of the
S&P 500 Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Prior to August 25, 1988, Class A
shares of the Fund were offered at a higher sales charge, so that actual
returns would have been somewhat lower. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
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2
.. The Guardian UBS Large Cap Value Fund Semiannual Report To Shareholders
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The Guardian UBS Large Cap Value Fund is managed by a team of investment
professionals from the Fund's sub-advisor, UBS Global Asset Management
(Americas) Inc., with many years of experience in large cap value investment
management.
Objective:
Seeks to maximize total return, consisting of capital appreciation and current
income
Inception:
February 3, 2003
Net assets at
June 30, 2004:
$88,225,121
Portfolio:
At least 80% in equity securities issued by companies with a large market
capitalization at the time of purchase
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Top Ten Holdings (As of 6/30/04)
Percentage of
Company Total Net Assets
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Citigroup, Inc. 5.32%
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Exxon Mobil Corp. 5.21%
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J.P. Morgan Chase & Co. 4.42%
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Wells Fargo & Co. 4.22%
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Nextel Comm., Inc. 4.22%
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Morgan Stanley 3.98%
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UnitedHealth Group 3.29%
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Illinois Tool Works, Inc. 3.11%
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Federal Home Loan Mortgage Corp. 3.09%
--------------------------------------------------------------------------
ConocoPhillips 2.91%
Sector Weightings vs. Index (As of 6/30/04)
[CHART]
The Guardian UBS Large
Cap Value Fund Russell 1000 Value Index
Financials 34.26% 36.41%
Industrials 10.05% 6.96%
Health Care 9.42% 4.21%
Consumer Discretionary 8.69% 11.55%
Utilities 8.11% 5.29%
Energy 8.01% 10.77%
Telecommunication Services 7.44% 5.21%
Materials 6.59% 6.33%
Information Technology 4.52% 7.55%
Consumer Staples 2.91% 5.72%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- ------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (2/3/03) 2.98 19.02 -- -- -- 24.02
(w/ sales charge) (2/3/03) -1.65 13.66 -- -- -- 20.02
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Class B Shares (w/o sales charge) (2/3/03) 2.54 18.11 -- -- -- 23.09
(w/ sales charge) (2/3/03) -0.46 15.11 -- -- -- 21.12
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Class C Shares (w/o sales charge) (2/3/03) 2.54 18.11 -- -- -- 23.09
(w/ sales charge) (2/3/03) 1.54 17.11 -- -- -- 23.09
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Class K Shares (w/o sales charge) (2/3/03) 2.79 18.78 -- -- -- 23.68
(w/ sales charge) (2/3/03) 1.79 17.78 -- -- -- 22.68
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Russell 1000 Value Index 3.94 21.13 -- -- -- 25.53
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested.
.. Please see the "About Your Semiannual Report" page for a description of the
Russell 1000 Value Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
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3
.. The Guardian Park Avenue Small Cap Fund Semiannual Report To Shareholders
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[PHOTO]
Matthew Ziehl
Matthew Ziehl, C.F.A.,
Portfolio Manager
Objective:
Long-term growth of capital
Inception:
May 1, 1997
Net assets at
June 30, 2004:
$208,604,318
Portfolio:
At least 85% in a diversified portfolio of common stocks issued by companies
with a small market capitalization at the time of initial purchase
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Top Ten Holdings (As of 6/30/04)
Percentage of
Company Total Net Assets
---------------------------------------------------------------------------
Investors Financial Svcs. Corp. 3.00%
---------------------------------------------------------------------------
American Medical Systems Hldgs., Inc. 2.74%
---------------------------------------------------------------------------
Energy Partners Ltd. 2.39%
---------------------------------------------------------------------------
Financial Federal Corp. 2.38%
---------------------------------------------------------------------------
Piper Jaffray Cos., Inc. 2.33%
---------------------------------------------------------------------------
Cost Plus, Inc. 2.25%
---------------------------------------------------------------------------
Boston Private Financial Hldgs., Inc. 2.19%
---------------------------------------------------------------------------
Movie Gallery, Inc. 2.18%
---------------------------------------------------------------------------
Federal Agricultural Mortgage Corp. 2.10%
---------------------------------------------------------------------------
Direct General Corp. 1.98%
Sector Weightings vs. Index (As of 6/30/04)
[CHART]
The Guardian Park Avenue
Small Cap Fund Russell 2000 Index
Financials 21.60% 20.49%
Information Technology 20.80% 18.92%
Consumer Discretionary 13.90% 14.62%
Industrials 13.70% 14.89%
Health Care 13.70% 14.02%
Energy 6.60% 4.51%
Materials 4.20% 5.53%
Consumer Staples 2.20% 2.98%
Telecommunication Services 1.90% 1.20%
Utilities 0.70% 2.84%
Cash 0.70% 0.00%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- ------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (5/1/97) 3.89 30.21 6.92 9.63 -- 10.01
(w/ sales charge) (5/1/97) -0.79 24.35 5.29 8.63 -- 9.31
- ------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (5/6/97) 3.47 29.01 5.92 8.64 -- 8.56
(w/ sales charge) (5/6/97) 0.47 26.01 5.32 8.50 -- 8.56
- ------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) 3.37 28.80 5.74 -- -- -1.05
(w/ sales charge) (8/7/00) 2.37 27.80 5.74 -- -- -1.05
- ------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) 3.79 29.84 6.62 -- -- 6.66
(w/ sales charge) (5/15/01) 2.79 28.84 6.62 -- -- 6.66
- ------------------------------------------------------------------------------------------
Russell 2000 Index 6.76 33.37 6.24 6.63 -- 9.29
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested. Small-cap investing entails
special risks, as small-cap stocks have tended to be more volatile and to
drop more in down markets than large-cap stocks. This may happen because
small companies may be limited in terms of product lines, financial resources
and management.
.. Please see the "About Your Semiannual Report" page for a description of the
Russell 2000 Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
- --------------------------------------------------------------------------------
4
.. The Guardian UBS Small Cap Value Fund Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
The Guardian UBS Small Cap Value Fund is managed by a team of investment
professionals from the Fund's sub-advisor, UBS Global Asset Management
(Americas) Inc., with many years of experience in small cap value investment
management.
Objective:
Seeks to maximize total return, consisting of capital appreciation and current
income
Inception:
February 3, 2003
Net assets at June 30, 2004:
$41,916,513
Portfolio:
At least 80% in equity securities issued by companies with a small market
capitalization at the time of initial purchase
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Percentage of
Company Total Net Assets
-----------------------------------------------------------------------
Equitable Resources, Inc. 2.97%
-----------------------------------------------------------------------
AmerUs Group Co. 2.45%
-----------------------------------------------------------------------
McGrath Rentcorp 2.26%
-----------------------------------------------------------------------
IndyMac Bancorp, Inc. 2.24%
-----------------------------------------------------------------------
Renal Care Group, Inc. 2.13%
-----------------------------------------------------------------------
Offshore Logistics, Inc. 1.82%
-----------------------------------------------------------------------
Harris Corp. 1.82%
-----------------------------------------------------------------------
Regal-Beloit Corp. 1.80%
-----------------------------------------------------------------------
Park Electrochemical Corp. 1.70%
-----------------------------------------------------------------------
Oceaneering Int'l., Inc. 1.68%
Sector Weightings vs. Index (As of 6/30/04)
[CHART]
The Guardian UBS Small
Cap Value Fund Russell 2000 Value Index
Financials 21.65% 21.22%
Information Technology 19.03% 22.68%
Industrials 17.67% 10.82%
Consumer Discretionary 16.78% 13.70%
Health Care 14.63% 12.07%
Energy 4.20% 4.26%
Materials 3.02% 8.50%
Consumer Staples 2.29% 2.91%
Utilities 0.73% 2.93%
Telecommunication Services 0.00% 0.91%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- -----------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (2/3/03) 5.39 24.31 -- -- -- 18.72
(w/ sales charge) (2/3/03) 0.65 18.72 -- -- -- 24.82
- -----------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (2/3/03) 5.04 23.30 -- -- -- 28.00
(w/ sales charge) (2/3/03) 2.04 20.30 -- -- -- 38.38
- -----------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (2/3/03) 5.04 23.30 -- -- -- 28.00
(w/ sales charge) (2/3/03) 4.04 22.30 -- -- -- 28.00
- -----------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (2/3/03) 5.41 24.16 -- -- -- 28.79
(w/ sales charge) (2/3/03) 4.41 23.16 -- -- -- 27.79
- -----------------------------------------------------------------------------------------
Russell 2000 Value Index 7.83 35.17 -- -- -- 41.26
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested. Small-cap investing entails
special risks, as small-cap stocks have tended to be more volatile and to
drop more in down markets than large-cap stocks. This may happen because
small companies may be limited in terms of product lines, financial resources
and management.
.. Please see the "About Your Semiannual Report" page for a description of the
Russell 2000 Value Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
- --------------------------------------------------------------------------------
5
.. The Guardian Asset Allocation Fund Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Jonathan C. Jankus
Jonathan C. Jankus, C.F.A.,
Co-Portfolio Manager
[PHOTO]
Stewart Johnson
Stewart Johnson,
Co-Portfolio Manager
Objective:
Long-term total investment return consistent with moderate investment risk
Inception:
February 16, 1993
Net assets at
June 30, 2004:
$162,488,991
Portfolio:
Generally purchases shares of The Guardian S&P 500 Index, The Guardian Park
Avenue, The Guardian Investment Quality Bond and/or The Guardian Cash
Management Funds. Also invests in individual securities and uses futures to
manage allocations among the equity, debt and money market asset classes.
- --------------------------------------------------------------------------------
Portfolio Composition by Asset Class (As of 6/30/04)
[CHART]
The Guardian Asset The Guardian Asset
Allocation Fund, Allocation Fund,
June 30, 2004 December 31, 2003
Cash 0.37% 0.59%
Fixed Income 0.05% 0.00%
Common Stocks 99.58% 99.41%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- --------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (2/16/93) 2.99 18.10 0.44 0.58 9.25 8.69
(w/ sales charge) (2/16/93) -1.64 12.79 -1.09 -0.34 8.75 8.25
- --------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (5/1/96) 2.52 17.02 -0.44 -0.28 -- 6.54
(w/ sales charge) (5/1/96) -0.48 14.02 -1.11 -0.48 -- 6.54
- --------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) 2.47 16.86 -0.69 -- -- -3.79
(w/ sales charge) (8/7/00) 1.47 15.86 -0.69 -- -- -3.79
- --------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) 2.84 17.72 0.01 -- -- -1.28
(w/ sales charge) (5/15/01) 1.84 16.72 0.01 -- -- -1.28
- --------------------------------------------------------------------------------------------
Custom Index: 60% S&P 500 Index,
40% Lehman Aggregate Bond Index 2.13 11.36 2.50 1.76 10.38 9.55
Since Class A
shares inception
.. The Custom Index total return data is comprised of 60% of the S&P 500 Index
and 40% of the Lehman Brothers Aggregate Bond Index to reflect a 60/40
neutral weighting of the Fund. Please see the "About Your Semiannual Report"
page for a description of the S&P 500 Index and the Lehman Brothers Aggregate
Bond Index.
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
- --------------------------------------------------------------------------------
6
.. The Guardian S&P 500 Index Fund Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Jonathan C. Jankus
Jonathon C. Jankus, C.F.A.,
Co-Portfolio Manager
[PHOTO]
Stewart Johnson
Stewart Johnson,
Co-Portfolio Manager
Objective:
Seeks to track the investment performance of the Standard & Poor's 500
Composite Stock Price Index ("the S&P 500 Index")
Inception:
August 7, 2000
Net assets at June 30, 2004:
$167,090,121
Portfolio:
Common stocks of companies included in the S&P 500 Index, which emphasizes
securities issued by large U.S. companies
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Percentage of
Company Total Net Assets
-----------------------------------------------------------------------
General Electric Co. 3.01%
-----------------------------------------------------------------------
Microsoft Corp. 2.84%
-----------------------------------------------------------------------
Exxon Mobil Corp. 2.68%
-----------------------------------------------------------------------
Pfizer, Inc. 2.42%
-----------------------------------------------------------------------
Citigroup, Inc. 2.19%
-----------------------------------------------------------------------
Wal-Mart Stores, Inc. 2.09%
-----------------------------------------------------------------------
American Int'l. Group, Inc. 1.71%
-----------------------------------------------------------------------
Intel Corp. 1.65%
-----------------------------------------------------------------------
Bank of America Corp. 1.59%
-----------------------------------------------------------------------
Johnson & Johnson 1.51%
Sector Weightings vs. Index (As of 6/30/04)
[CHART]
The Guardian S&P 500 Index Fund S&P 500 Index
Financials 20.26% 20.28%
Information Technology 17.18% 17.23%
Health Care 13.25% 13.31%
Consumer Discretionary 10.80% 10.94%
Consumer Staples 11.19% 11.14%
Industrial 11.41% 11.47%
Energy 6.32% 6.57%
Telecommunication Services 3.41% 3.42%
Materials 3.02% 2.97%
Utilities 2.82% 2.67%
Cash 0.34% 0.00%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- -------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (8/7/00) 3.08 18.35 -1.20 -- -- -5.37
(w/ sales charge) (8/7/00) -1.56 13.02 -2.70 -- -- -6.48
- -------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (8/7/00) 2.78 17.54 -2.03 -- -- -6.15
(w/ sales charge) (8/7/00) -0.22 14.54 -2.69 -- -- -6.64
- -------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) 2.77 17.56 -2.07 -- -- -6.18
(w/ sales charge) (8/7/00) 1.77 16.56 -2.07 -- -- -6.18
- -------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) 2.91 17.89 -1.72 -- -- -3.13
(w/ sales charge) (5/15/01) 1.91 16.89 -1.72 -- -- -3.13
- -------------------------------------------------------------------------------------------
S&P 500 Index 3.44 19.11 -0.69 -- -- -4.98
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested.
.. Please see the "About Your Semiannual Report" page for a description of the
S&P 500 Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
- --------------------------------------------------------------------------------
7
.. The Guardian Baillie Gifford International Growth Fund
Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Menzies
R. Robin Menzies, Portfolio Manager
Objective:
Long-term growth of capital
Inception:
February 16, 1993
Net assets at June 30, 2004:
$50,610,040
Portfolio:
At least 80% in a diversified portfolio of common stocks and convertible
securities of companies domiciled outside the United States
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Percentage of
Company Country Total Net Assets
- -------------------------------------------------------------------------------------
Vodafone Group United Kingdom 3.37%
- -------------------------------------------------------------------------------------
Total S.A. France 2.82%
- -------------------------------------------------------------------------------------
BP PLC United Kingdom 2.70%
- -------------------------------------------------------------------------------------
Nokia OYJ Finland 2.67%
- -------------------------------------------------------------------------------------
Imperial Tobacco United Kingdom 2.60%
- -------------------------------------------------------------------------------------
Asahi Glass Co. Japan 2.09%
- -------------------------------------------------------------------------------------
L'Oreal S.A. France 2.07%
- -------------------------------------------------------------------------------------
GlaxoSmithKline PLC United Kingdom 2.04%
- -------------------------------------------------------------------------------------
UBS AG Switzerland 1.96%
- -------------------------------------------------------------------------------------
Porsche AG Germany 1.91%
Sector Weightings vs. Index (As of 6/30/04)
[CHART]
The Guardian Baillie Gifford MSCI EAFE
International Growth Fund Growth
Index
Financials 20.1% 15.6%
Information Technology 14.7% 12.1%
Industrials 12.1% 10.5%
Consumer Discretionary 13.9% 13.4%
Health Care 6.3% 14.2%
Consumer Staples 11.0% 11.7%
Energy 10.1% 3.9%
Materials 4.1% 5.6%
Utilities 0.0% 2.3%
Telecommunication Services 5.8% 10.7%
Cash 1.9% 0.0%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- --------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (2/16/93) 2.04 21.24 -1.91 -3.70 3.65 5.59
(w/ sales charge) (2/16/93) -2.55 15.78 -3.40 -4.58 3.17 5.16
- --------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (5/1/96) 1.53 20.02 -3.04 -4.74 -- 1.03
(w/ sales charge) (5/1/96) -1.47 17.02 -3.69 -4.93 -- 1.03
- --------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) 1.62 19.95 -3.01 -- -- -8.97
(w/ sales charge) (8/7/00) 0.62 18.95 -3.01 -- -- -8.97
- --------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) 2.05 21.12 -2.04 -- -- -3.78
(w/ sales charge) (5/15/01) 1.05 20.12 -2.04 -- -- -3.78
- --------------------------------------------------------------------------------------------
MSCI EAFE Growth Index 2.72 26.80 2.06 -3.02 2.04 4.40
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested.
.. Please see the "About Your Semiannual Report" page for a description of the
Morgan Stanley Capital International (MSCI) Europe, Australasia and Far East
(EAFE) Growth Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted.
.. International investing has special risks relating to changes in currency
rates, foreign taxation, differences in auditing and other financial
standards, political uncertainty and greater volatility. Please refer to the
Financial Statements, accompanying Notes to Financial Statements, and
Financial Highlights sections of this report for specific information about
the fees and expenses borne by the Fund.
.. Prior to May 1, 2004, this Fund was known as The Guardian Baillie Gifford
International Fund.
- --------------------------------------------------------------------------------
8
.. The Guardian Baillie Gifford Emerging Markets Fund
Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Edward H. Hocknell
Edward H. Hocknell, Portfolio Manager
Objective:
Long-term capital appreciation
Inception:
May 1, 1997
Net assets at June 30, 2004:
$79,520,309
Portfolio:
At least 80% in a portfolio of common stocks and convertible securities issued
by companies in emerging markets
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Percentage of
Company Country Total Net Assets
- --------------------------------------------------------------------------------------
Samsung Electronics Co. Ltd. South Korea 3.56%
- --------------------------------------------------------------------------------------
America Movil S.A. de C.V. ADR Mexico 2.88%
- --------------------------------------------------------------------------------------
Sasol Ltd. South Africa 2.82%
- --------------------------------------------------------------------------------------
Samsung Corp. South Korea 2.61%
- --------------------------------------------------------------------------------------
LUKOIL ADR Russia 2.59%
- --------------------------------------------------------------------------------------
Hon Hai Precision Inds. Co. Ltd. Taiwan 2.26%
- --------------------------------------------------------------------------------------
Telecom. Norte Leste Participacoes ADR Brazil 2.12%
- --------------------------------------------------------------------------------------
Turkiye Garanti Bankasi AS Turkey 2.10%
- --------------------------------------------------------------------------------------
Anglo American Platinum Corp. South Africa 2.02%
- --------------------------------------------------------------------------------------
Itausa-Investimentos Itau S.A. Brazil 1.97%
Sector Weightings vs. Index (As of 6/30/04)
[CHART]
The Guardian Baillie Gifford
Emerging Markets Fund MSCI EMF Index
Materials 18.2% 15.8%
Telecommunication Services 16.8% 12.0%
Energy 13.4% 11.7%
Industrials 11.3% 6.8%
Information Technology 11.2% 16.7%
Financials 10.5% 17.5%
Consumer Discretionary 8.9% 7.3%
Consumer Staples 5.3% 5.8%
Cash 2.0% 0.0%
Health Care 1.7% 3.1%
Utilities 0.7% 3.3%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- -------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (5/1/97) -1.70 32.24 11.95 8.70 -- 3.04
(w/ sales charge) (5/1/97) -6.12 26.29 10.24 7.70 -- 2.38
- -------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (5/6/97) -2.19 30.72 10.69 7.13 -- 1.17
(w/ sales charge) (5/6/97) -5.12 27.72 10.14 6.98 -- 1.17
- -------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) -2.18 30.77 10.79 -- -- 3.21
(w/ sales charge) (8/7/00) -3.16 29.77 10.79 -- -- 3.21
- -------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) -1.87 31.74 11.63 -- -- 11.97
(w/ sales charge) (5/15/01) -2.85 30.74 11.63 -- -- 11.97
- -------------------------------------------------------------------------------------------
MSCI EMF Index -0.78 33.51 13.10 3.27 -- -0.03
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested. International investing has
special risks relating to changes in currency rates, foreign taxation,
differences in auditing and other financial standards, political uncertainty
and greater volatility. These risks are even greater when investing in
emerging markets.
.. Please see the "About Your Semiannual Report" page for a description of the
Morgan Stanley Capital International (MSCI) Emerging Markets Free (EMF) Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
- --------------------------------------------------------------------------------
9
.. The Guardian Investment Quality Bond Fund Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Howard W. Chin
Howard W. Chin,
Co-Portfolio Manager
[PHOTO]
Rob Crimmins
Robert Crimmins,
Co-Portfolio Manager
Objective:
High level of current income and capital appreciation without undue risk to
principal
Inception:
February 16, 1993
Net assets at
June 30, 2004:
$160,879,801
Portfolio:
At least 80% in different kinds of investment grade bonds, such as corporate
bonds, mortgage-backed and asset-backed securities, and obligations of the U.S.
government and its agencies
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Maturity Percentage of
Company Coupon Date Total Net Assets
- --------------------------------------------------------------------------------------
U.S. Treasury Notes 4.375% 5/15/2007 5.36%
- --------------------------------------------------------------------------------------
FHLMC 5.500% 12/1/2033 4.28%
- --------------------------------------------------------------------------------------
U.S. Treasury Bonds 6.000% 2/15/2026 3.84%
- --------------------------------------------------------------------------------------
FNMA (30 yr. TBA) 5.000% N/A 3.30%
- --------------------------------------------------------------------------------------
Citigroup Global Markets Hldgs, Inc. 1.100% 7/15/2004 3.11%
- --------------------------------------------------------------------------------------
FHLMC 5.500% 12/1/2033 2.68%
- --------------------------------------------------------------------------------------
U.S. Treasury Notes 4.750% 5/15/2014 2.31%
- --------------------------------------------------------------------------------------
FNMA (30 yr. TBA) 5.500% N/A 2.29%
- --------------------------------------------------------------------------------------
FNMA 3.250% 1/15/2008 2.20%
- --------------------------------------------------------------------------------------
Proctor & Gamble Co. 1.020% 7/15/2004 2.05%
Sector Allocation (As of 6/30/04)
[CHART]
The Guardian Investment The Guardian Investment
Quality Bond Fund, Quality Bond Fund,
June 30, 2004 December 31, 2003
Mortgage Backed Securities 37.06% 38.03%
Corporate Notes/Bonds 26.14% 35.69%
Treasury Notes/Bonds 13.77% 1.94%
CMOs 6.81% 4.37%
CMBs 3.86% 9.18%
Short-Term 4.90% 0.78%
Asset Backed Securities 4.76% 5.98%
Govt. Agencies 2.70% 4.03%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- -------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (2/16/93) 0.01 0.19 6.17 6.45 6.58 5.81
(w/ sales charge) (2/16/93) -4.49 -4.32 4.55 5.47 6.09 5.38
- -------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (8/7/00) -0.36 -0.47 5.41 -- -- 6.15
(w/ sales charge) (8/7/00) -3.35 -3.46 4.81 -- -- 5.72
- -------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) -0.36 -0.56 5.42 -- -- 6.15
(w/ sales charge) (8/7/00) -1.36 -1.55 5.42 -- -- 6.15
- -------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) -0.19 -0.21 5.75 -- -- 5.71
(w/ sales charge) (5/15/01) -1.19 -1.21 5.75 -- -- 5.71
- -------------------------------------------------------------------------------------------
Lehman Brothers Aggregate Bond Index 0.15 0.32 6.36 6.95 7.39 6.75
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested. Investing in bond funds exposes
you to the general risk of investing in the debt markets. Duration is a
measure of bond price sensitivity to a given change in interest rates.
Generally, the lower a bond's duration, the greater its price sensitivity to
a given change in interest rates. Bond funds are subject to interest rate
risk. When interest rates rise, bond prices generally fall, and when interest
rates fall, bond prices generally rise. Currently, interest rates are at
historically low levels. Please keep in mind that in this kind of
environment, the risk that bond prices may fall when interest rates rise is
potentially greater.
.. Please see the "About Your Semiannual Report" page for a description of the
Lehman Brothers Aggregate Bond Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Since June 1, 1994, the investment
adviser for the Fund has assumed certain ordinary operating expenses for the
Fund. Without this assumption of expenses, returns would have been lower.
Please refer to the Financial Statements, accompanying Notes to Financial
Statements, and Financial Highlights sections of this report for specific
information about the fees and expenses borne by the Fund.
- --------------------------------------------------------------------------------
10
.. The Guardian Low Duration Bond Fund Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Howard W. Chin
Howard W. Chin,
Co-Portfolio Manager
[PHOTO]
Rob Crimmins
Robert Crimmins,
Co-Portfolio Manager
Objective:
Seeks a high level of current income, consistent with preservation of capital
Inception:
July 30, 2003
Net assets at June 30, 2004:
$32,351,844
Portfolio:
At least 80% in investment grade corporate and government bonds, and asset- and
mortgage-backed securities
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Maturity Percentage of
Company Coupon Date Total Net Assets
- -------------------------------------------------------------------------------------------
U.S. Treasury Notes 3.375% 12/15/2008 7.35%
- -------------------------------------------------------------------------------------------
U.S. Treasury Notes 2.625% 3/15/2009 6.98%
- -------------------------------------------------------------------------------------------
Time Warner, Inc. 5.625% 5/1/2005 3.17%
- -------------------------------------------------------------------------------------------
Residential Asset Mtg. Prods., Inc. 2.140% 2/25/2030 1.83%
- -------------------------------------------------------------------------------------------
Cox Comm., Inc. 7.750% 8/15/2006 1.68%
- -------------------------------------------------------------------------------------------
Avalon Bay Communities, Inc. 6.800% 7/15/2006 1.67%
- -------------------------------------------------------------------------------------------
British Telecom. PLC 7.875% 12/15/2005 1.65%
- -------------------------------------------------------------------------------------------
Northrop Grumman Corp. 7.000% 3/1/2006 1.64%
- -------------------------------------------------------------------------------------------
Nisource Fin. Corp. 7.625% 11/15/2005 1.64%
- -------------------------------------------------------------------------------------------
MBNA America Bank NA 6.500% 6/20/2006 1.64%
Sector Allocation (As of 6/30/04)
[CHART]
The Guardian Low Duration The Guardian Low Duration
Bond Fund, Bond Fund,
June 30, 2004 December 31, 2003
Corporate Notes/Bonds 67.25% 72.79%
Treasury Notes/Bonds 15.91% 10.90%
Asset Backeds 7.19% 8.26%
CMOs 6.56% 4.44%
CMBs 2.22% 1.79%
Taxable Municipals 0.00% 1.62%
Short-Term 0.87% 0.20%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- ----------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (7/30/03) 0.21 -- -- -- -- 1.20
(w/ sales charge) (7/30/03) -4.30 -- -- -- -- -3.35
- ----------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (7/30/03) -0.16 -- -- -- -- 0.51
(w/ sales charge) (7/30/03) -3.16 -- -- -- -- -2.49
- ----------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (7/30/03) -0.16 -- -- -- -- 0.51
(w/ sales charge) (7/30/03) -1.16 -- -- -- -- -0.49
- ----------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (7/30/03) 0.01 -- -- -- -- 0.83
(w/ sales charge) (7/30/03) -0.99 -- -- -- -- -0.17
- ----------------------------------------------------------------------------------------------
Lehman Brothers U.S. Government 1-3 Year
Bond Index 0.28 -- -- -- -- 0.90
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested. Investing in bond funds exposes
you to the general risk of investing in the debt markets. Duration is a
measure of bond price sensitivity to a given change in interest rates.
Generally, the lower a bond's duration, the greater its price sensitivity to
a given change in interest rates. Bond funds are subject to interest rate
risk. When interest rates rise, bond prices generally fall, and when interest
rates fall, bond prices generally rise. Currently, interest rates are at
historically low levels. Please keep in mind that in this kind of
environment, the risk that bond prices may fall when interest rates rise is
potentially greater.
.. Low duration bond funds may not be a suitable alternative to money market
funds because, unlike money market funds, low duration bond funds do not seek
to maintain a stable net asset value and, as a result, are a riskier asset
class.
.. Please see the "About Your Semiannual Report" page for a description of the
Lehman Brothers U.S. Government 1-3 Year Bond Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights section of this report for specific information about the fees and
expenses borne by the Fund.
- --------------------------------------------------------------------------------
11
.. The Guardian High Yield Bond Fund
Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Peter J.Liebst
Peter J. Liebst, Portfolio Manager
Objective:
Seeks current income. Capital appreciation is a secondary objective.
Inception:
September 1, 1998
Net assets at June 30, 2004:
$71,751,151
Portfolio:
At least 80% is invested in corporate bonds and other debt securities that, at
the time of purchase, are rated below investment grade or are unrated.
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Maturity Percentage of
Company Coupon Date Total Net Assets
- --------------------------------------------------------------------------------------
Allegheny Energy Supply 7.800% 3/15/2011 2.03%
- --------------------------------------------------------------------------------------
Sierra Pacific Resources 8.625% 3/15/2014 1.82%
- --------------------------------------------------------------------------------------
Houghton Mifflin Co. 9.875% 2/1/2013 1.45%
- --------------------------------------------------------------------------------------
Merisant Co. 9.500% 7/15/2013 1.44%
- --------------------------------------------------------------------------------------
Six Flags, Inc. 9.625% 6/1/2014 1.39%
- --------------------------------------------------------------------------------------
Premium Standard Farms, Inc. 9.250% 6/15/2011 1.39%
- --------------------------------------------------------------------------------------
United Rentals NA, Inc. 7.750% 11/15/2013 1.37%
- --------------------------------------------------------------------------------------
Jafra Cosmetics 10.750% 5/15/2011 1.29%
- --------------------------------------------------------------------------------------
El Paso Production Hldg. 7.750% 6/1/2013 1.23%
- --------------------------------------------------------------------------------------
Charter Comm. Hldgs. 10.250% 1/15/2010 1.20%
Bond Quality (As of 6/30/04)
[CHART]
The Guardian High Yield The Guardian High Yield
Bond Fund, Bond Fund,
June 30, 2004 December 31, 2003
Short-Term 6.42% 2.08%
BBB 0.00% 0.98%
BB 17.80% 19.77%
B 64.94% 70.85%
CCC 10.84% 6.32%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- ---------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (9/1/98) 1.23 8.71 7.74 3.33 -- 4.47
(w/ sales charge) (9/1/98) -3.33 3.82 6.10 2.38 -- 3.65
- ---------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (9/1/98) 0.86 8.06 6.98 2.49 -- 3.54
(w/ sales charge) (9/1/98) -2.14 5.06 6.39 2.31 -- 3.39
- ---------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (6/7/00) 0.86 8.06 6.98 -- -- 3.71
(w/ sales charge) (6/7/00) -0.14 7.06 6.98 -- -- 3.71
- ---------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) 1.17 8.43 7.36 -- -- 6.26
(w/ sales charge) (5/15/01) 0.17 7.43 7.36 -- -- 6.26
- ---------------------------------------------------------------------------------------------
Lehman Brothers Corporate High Yield Bond Index 1.36 10.33 9.30 5.06 -- 5.18
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested. Investing in bond funds exposes
you to the general risk of investing in the debt markets. Duration is a
measure of bond price sensitivity to a given change in interest rates.
Generally, the lower a bond's duration, the greater its price sensitivity to
a given change in interest rates. Bond funds are subject to interest rate
risk. When interest rates rise, bond prices generally fall, and when interest
rates fall, bond prices generally rise. Currently, interest rates are at
historically low levels. Please keep in mind that in this kind of
environment, the risk that bond prices may fall when interest rates rise is
potentially greater.
.. Investing in high yield bonds involves special risks because investments in
lower rated and unrated debt securities are subject to greater loss of
principal and interest than higher rated securities.
.. Please see the "About Your Semiannual Report" page for a description of the
Lehman Brothers Corporate High Yield Bond Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Please refer to the Financial
Statements, accompanying Notes to Financial Statements, and Financial
Highlights sections of this report for specific information about the fees
and expenses borne by the Fund.
- --------------------------------------------------------------------------------
12
.. The Guardian Tax-Exempt Fund Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Alexander M. Grant, Jr.
Alexander M. Grant, Jr., Portfolio Manager
Objective:
Seeks to maximize current income exempt from federal income taxes, consistent
with the preservation of capital
Inception:
February 16, 1993
Net assets at June 30, 2004:
$87,947,358
Portfolio:
At least 80% in investment grade municipal debt obligations
- --------------------------------------------------------------------------------
Top Ten Holdings (As of 6/30/04)
Maturity Percentage of
Company Coupon Date Total Net Assets
- -------------------------------------------------------------------------------------
California St. Dept. Wtr. Resources Pwr. Supply
Rev. 1.040% 5/1/2022 4.55%
- -------------------------------------------------------------------------------------
New York St. Housing Fin. Agy. Rev. 6.000% 11/1/2006 3.89%
- -------------------------------------------------------------------------------------
California St. Econ. G.O. Ser. B 5.000% 7/1/2023 3.68%
- -------------------------------------------------------------------------------------
Fairfax Cnty., VA Ref. Pub. Impt. Ser. A 4.250% 6/1/2008 3.59%
- -------------------------------------------------------------------------------------
Illinois St. Unemployment Insurance 5.000% 12/15/2007 3.04%
- -------------------------------------------------------------------------------------
Puerto Rico Pub. Bldgs. Auth. Rev. Ref. Gov't.
Facs. Ser. K 4.500% 7/1/2022 2.84%
- -------------------------------------------------------------------------------------
Puerto Rico Pub. Fin. Corp. Comwlth. Approp. Ser.
A 5.750% 8/1/2027 2.49%
- -------------------------------------------------------------------------------------
Florida St. Brd. of Ed. Lottery Rev. Ser. A 5.500% 7/1/2017 2.46%
- -------------------------------------------------------------------------------------
Harris Cnty., TX Ref. Ser. B 5.000% 8/15/2032 2.45%
- -------------------------------------------------------------------------------------
Puerto Rico Pub. Bldgs. Auth. Rev. Ref. Gov't.
Facs. Ser. J 5.000% 7/1/2036 2.45%
Sector Allocation (As of 6/30/04)
[CHART]
The Guardian The Guardian
Tax-Exempt Fund, Tax-Exempt Fund,
June 30, 2004 December 31, 2003
Insured Bonds 45.38% 52.07%
Revenue Bonds 32.27% 27.10%
State General Obligation Bonds 10.08% 4.72%
Local General Obligation Bonds 7.43% 14.31%
Short-Term 4.84% 1.80%
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- -------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (2/16/93) -1.39 -0.52 5.45 5.80 5.88 5.03
(w/ sales charge) (2/16/93) -5.83 -5.00 3.84 4.83 5.39 4.61
- -------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) -1.76 -1.27 4.66 -- -- 5.34
(w/ sales charge) (8/7/00) -2.74 -2.26 4.66 -- -- 5.34
- -------------------------------------------------------------------------------------------
Lehman Brothers Municipal Bond Index -0.68 0.76 5.42 5.87 6.44 6.08
Since Class A
shares inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested.
.. Please see the "About Your Semiannual Report" page for a description of the
Lehman Brothers Municipal Bond Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
redemption of shares. Total return figures for Class A shares do not take
into account the current maximum sales charge of 4.5%, except where noted.
Total return figures for Class C shares do not take into account the
contingent deferred sales charges applicable to such shares (maximum of 1%)
except where noted. Since June 1, 1994, the investment adviser for the Fund
has assumed certain ordinary operating expenses for the Fund. Without this
assumption of expenses, returns would have been lower. Please refer to the
Financial Statements, accompanying Notes to Financial Statements, and
Financial Highlights sections of this report for specific information about
the fees and expenses borne by the Fund.
- --------------------------------------------------------------------------------
13
.. The Guardian Cash Management Fund Semiannual Report To Shareholders
- --------------------------------------------------------------------------------
[PHOTO]
Alexander M. Grant, Jr.
Alexander M. Grant, Jr.,
Portfolio Manager
Objective:
Seeks as high a level of current income as is consistent with liquidity and
preservation of capital
Inception:
November 3, 1982
Net assets at
June 30, 2004:
$497,405,816
Portfolio:
Short-term money market investments
- --------------------------------------------------------------------------------
Sector Allocation (As of 6/30/04)
[CHART]
The Guardian Cash
Management Fund
Repurchase Agreements 9.19%
Taxable Municipals 21.65%
Commercial Paper 69.16%
Portfolio Statistics (As of 6/30/04)
Average Maturity (days) 30
- --------------------------------------------------------
Effective 7-day yield
With subsidy 0.32%
Without subsidy 0.26%
- --------------------------------------------------------
Current 7-day yield
With subsidy 0.32%
Without subsidy 0.26%
Annualized historical yields for the 7-day periods ended June 30, 2004.
Effective yield assumes reinvested income. Yields will vary as interest rates
change.
Average Annual Total Returns (For periods ended 6/30/04)
Inception Since
Date YTD 1-Yr 3-Yr 5-Yr 10-Yr Inception
- --------------------------------------------------------------------------------------------
Class A Shares (w/o sales charge) (11/3/82) 0.13 0.26 0.85 2.54 3.62 5.13
- --------------------------------------------------------------------------------------------
Class B Shares (w/o sales charge) (5/1/96) 0.13 0.25 0.42 2.13 -- 3.07
(w/ sales charge) (5/1/96) -2.87 -2.75 -0.25 1.95 -- 3.07
- --------------------------------------------------------------------------------------------
Class C Shares (w/o sales charge) (8/7/00) 0.13 0.25 0.42 -- -- 1.29
(w/ sales charge) (8/7/00) -0.87 -0.75 0.42 -- -- 1.29
- --------------------------------------------------------------------------------------------
Class K Shares (w/o sales charge) (5/15/01) 0.08 0.16 0.57 -- -- 0.66
(w/ sales charge) (5/15/01) -0.92 -0.84 0.57 -- -- 0.66
- --------------------------------------------------------------------------------------------
Lehman Brothers 3 Month T-Bill Index 0.47 0.97 1.71 3.31 4.36 5.67
Since Class A
shares Inception
- --------------------------------------------------------------------------------
About information contained in this report:
.. All performance data quoted is historical and the results represent past
performance and neither guarantee nor predict future investment results. To
obtain performance data current to the most recent month (availability within
7 business days of the most recent month end), please call us at
1-800-221-3253 or visit our website at www.guardianinvestor.com. Current
performance may be higher or lower than the performance quoted here.
Investment return and principal value will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
.. It is important to consider the Fund's investment objectives, risks, fees and
expenses carefully before investing. All funds involve some risk, including
possible loss of principal amount invested.
.. Please see the "About Your Semiannual Report" page for a description of the
Lehman Brothers 3-Month Treasury Bill Index.
.. Total return figures are historical and assume the reinvestment of dividends
and distributions and the deduction of all Fund expenses. The return figures
shown do not reflect the deduction of taxes that a shareholder may pay on
distributions or redemption of shares. Total return figures for Class A
shares do not take into account the current maximum sales charge of 4.5%,
except where noted. Total return figures for Class B, Class C and Class K
shares do not take into account the contingent deferred sales charge
applicable to such shares (maximum 3% for Class B shares and 1% for Class C
and Class K shares), except where noted. Since June 1, 1994, the investment
adviser for the Fund has assumed certain ordinary operating expenses of the
Fund. Without these expense assumptions, the returns would have been lower.
The yield figures cited represent yield for Class A shares. Please refer to
the Financial Statements, accompanying Notes to Financial Statements, and
Financial Highlights sections of this report for specific information about
the fees and expenses borne by the Fund.
.. Shares of The Guardian Cash Management Fund are not issued or guaranteed by
the Federal Deposit Insurance Corporation (FDIC), the National Credit Union
Association (NCUA), the Federal Reserve Board or any other agency. Although
the Fund seeks to preserve the value of an investment at $1.00 per share, it
is possible to lose money by investing in the Fund.
- --------------------------------------------------------------------------------
14
.. The Guardian Park Avenue Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 99.6%
Shares Value
--------------------------------------------------------------
Aerospace and Defense -- 1.7%
224,100 United Technologies Corp. $ 20,500,668
-------------------------------------------------------------
Air Freight and Logistics -- 2.0%
312,800 United Parcel Svc., Inc. 23,513,176
-------------------------------------------------------------
Beverages -- 2.8%
352,100 Coca-Cola Co. 17,774,008
307,800 PepsiCo., Inc. 16,584,264
---------------
34,358,272
-------------------------------------------------------------
Biotechnology -- 1.1%
251,200 Amgen, Inc.* 13,707,984
-------------------------------------------------------------
Capital Markets -- 9.1%
205,200 Goldman Sachs Group, Inc. 19,321,632
351,300 Lehman Brothers Hldgs., Inc. 26,435,325
709,900 Mellon Financial Corp. 20,821,367
437,000 Merrill Lynch & Co., Inc. 23,589,260
406,100 State Street Corp. 19,915,144
---------------
110,082,728
-------------------------------------------------------------
Commercial Banks -- 5.2%
245,500 Bank of America Corp. 20,774,210
196,000 M & T Bank Corp. 17,110,800
426,500 Wells Fargo & Co. 24,408,595
---------------
62,293,605
-------------------------------------------------------------
Communications Equipment -- 2.4%
1,216,600 Cisco Systems, Inc.* 28,833,420
-------------------------------------------------------------
Computers and Peripherals -- 3.0%
481,700 Dell, Inc.* 17,254,494
1,026,300 EMC Corp.* 11,699,820
344,700 Hewlett Packard Co. 7,273,170
---------------
36,227,484
-------------------------------------------------------------
Diversified Financial Services -- 2.4%
618,166 Citigroup, Inc. 28,744,719
-------------------------------------------------------------
Diversified Telecommunication Services -- 0.8%
282,400 Verizon Comm. 10,220,056
-------------------------------------------------------------
Electric Utilities -- 0.9%
161,700 FPL Group, Inc. 10,340,715
-------------------------------------------------------------
Electronic Equipment and Instruments -- 0.9%
441,200 Jabil Circuit, Inc.* 11,109,416
-------------------------------------------------------------
Energy Equipment and Services -- 3.5%
395,100 Nabors Inds., Inc. 17,866,422
636,700 Noble Corp. 24,124,563
---------------
41,990,985
-------------------------------------------------------------
Food and Staples Retailing -- 3.5%
255,900 Costco Wholesale Corp. 10,509,813
316,700 Sysco Corp. 11,360,029
376,700 Wal-Mart Stores, Inc. 19,874,692
---------------
41,744,534
-------------------------------------------------------------
Food Products -- 2.0%
166,100 Bunge Ltd. 6,467,934
209,800 Hershey Foods Corp. 9,707,446
245,800 McCormick & Co., Inc. 8,357,200
---------------
24,532,580
-------------------------------------------------------------
Gas Utilities -- 0.6%
357,000 NiSource, Inc. 7,361,340
-------------------------------------------------------------
----------------------------------------------------------
Shares Value
----------------------------------------------------------
Health Care Equipment and Supplies -- 3.9%
308,800 Boston Scientific Corp.* $ 13,216,640
123,200 C.R. Bard, Inc. 6,979,280
117,900 Guidant Corp. 6,588,252
225,090 Hospira, Inc.* 6,212,484
278,100 Medtronic, Inc. 13,549,032
---------------
46,545,688
---------------------------------------------------------
Hotels, Restaurants and Leisure -- 2.9%
524,600 Carnival Corp. 24,656,200
559,800 Hilton Hotels Corp. 10,445,868
---------------
35,102,068
---------------------------------------------------------
Household Products -- 5.3%
539,700 Colgate-Palmolive Co. 31,545,465
597,400 Procter & Gamble Co. 32,522,456
---------------
64,067,921
---------------------------------------------------------
Industrial Conglomerates -- 4.4%
1,644,400 General Electric Co. 53,278,560
---------------------------------------------------------
Information Technology Services -- 2.1%
421,000 First Data Corp. 18,742,920
433,200 Unisys Corp.* 6,012,816
---------------
24,755,736
---------------------------------------------------------
Insurance -- 4.9%
103,400 Ambac Financial Group, Inc. 7,593,696
553,500 American Int'l. Group, Inc. 39,453,480
178,200 Chubb Corp. 12,149,676
---------------
59,196,852
---------------------------------------------------------
Internet and Catalog Retail -- 0.8%
179,600 Amazon.com, Inc.* 9,770,240
---------------------------------------------------------
Machinery -- 2.0%
116,100 Caterpillar, Inc. 9,222,984
215,500 Deere & Co. 15,115,170
---------------
24,338,154
---------------------------------------------------------
Media -- 0.5%
155,800 Viacom, Inc. 5,565,176
---------------------------------------------------------
Metals and Mining -- 3.5%
329,200 Alcoa, Inc. 10,873,476
401,700 Phelps Dodge Corp. 31,135,767
---------------
42,009,243
---------------------------------------------------------
Oil and Gas -- 6.7%
258,700 ChevronTexaco Corp. 24,346,257
486,400 Devon Energy Corp. 32,102,400
302,800 Exxon Mobil Corp. 13,447,348
234,700 Occidental Petroleum Corp. 11,361,827
---------------
81,257,832
---------------------------------------------------------
Pharmaceuticals -- 8.8%
227,300 Abbott Laboratories 9,264,748
155,600 Forest Laboratories, Inc.* 8,811,628
183,840 Johnson & Johnson 10,239,888
1,732,240 Pfizer, Inc. 59,381,187
514,500 Wyeth 18,604,320
---------------
106,301,771
---------------------------------------------------------
Semiconductors and Semiconductor Equipment -- 3.9%
253,700 Analog Devices, Inc. 11,944,196
1,038,500 Intel Corp. 28,662,600
- --------------------------------------------------------------------------------
See notes to financial statements.
15
.. The Guardian Park Avenue Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
--------------------------------------------------------------
Shares Value
--------------------------------------------------------------
125,500 KLA-Tencor Corp.* $ 6,197,190
--------------
46,803,986
------------------------------------------------------------
Software -- 6.0%
1,653,100 Microsoft Corp. 47,212,536
2,071,600 Oracle Corp.* 24,714,188
--------------
71,926,724
------------------------------------------------------------
Specialty Retail -- 1.3%
405,800 Bed, Bath & Beyond, Inc.* 15,603,010
------------------------------------------------------------
Tobacco -- 0.7%
175,500 Altria Group, Inc. 8,783,775
------------------------------------------------------------
Total Common Stocks
(Cost $1,069,452,894) 1,200,868,418
------------------------------------------------------------
Repurchase Agreement -- 1.1%
Principal
Amount Value
--------------------------------------------------------------
$ 13,399,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $13,399,502 at
1.35%, due 7/1/2004 (1)
(Cost $13,399,000) $ 13,399,000
------------------------------------------------------------
Total Investments -- 100.7%
(Cost $1,082,851,894) 1,214,267,418
Liabilities in Excess of Cash, Receivables and
Other Assets -- (0.7)% (8,616,271)
------------------------------------------------------------
Net Assets -- 100% $1,205,651,147
------------------------------------------------------------
* Non-income producing security.
(1)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
16
.. The Guardian UBS Large Cap Value Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 96.8%
Shares Value
---------------------------------------------------------
Aerospace and Defense -- 3.1%
21,400 Boeing Co. $ 1,093,326
18,000 Northrop Grumman Corp. 966,600
6,900 United Technologies Corp. 631,212
------------
2,691,138
---------------------------------------------------------
Airlines -- 0.3%
41,000 Delta Airlines, Inc. 291,920
---------------------------------------------------------
Auto Components -- 1.3%
21,800 Johnson Controls, Inc. 1,163,684
---------------------------------------------------------
Biotechnology -- 1.1%
18,600 Cephalon, Inc.* 1,004,400
---------------------------------------------------------
Building Products -- 2.3%
63,600 Masco Corp. 1,983,048
---------------------------------------------------------
Capital Markets -- 11.8%
100,500 J.P. Morgan Chase & Co. 3,896,385
73,400 Mellon Financial Corp. 2,152,822
66,500 Morgan Stanley 3,509,205
20,800 Northern Trust Corp. 879,424
------------
10,437,836
---------------------------------------------------------
Commercial Banks -- 8.1%
19,928 Bank of America Corp. 1,686,307
33,100 PNC Financial Svcs. Group 1,756,948
65,000 Wells Fargo & Co. 3,719,950
------------
7,163,205
---------------------------------------------------------
Commercial Services and Supplies -- 0.6%
20,300 Equifax, Inc. 502,425
---------------------------------------------------------
Construction Materials -- 1.8%
35,500 Martin Marietta Materials, Inc. 1,573,715
---------------------------------------------------------
Diversified Financial Services -- 5.3%
100,900 Citigroup, Inc. 4,691,850
---------------------------------------------------------
Diversified Telecommunication Services -- 3.3%
44,100 BellSouth Corp. 1,156,302
72,600 SBC Comm., Inc. 1,760,550
------------
2,916,852
---------------------------------------------------------
Electric Utilities -- 6.8%
54,900 American Electric Power, Inc. 1,756,800
45,900 CMS Energy Corp.* 419,067
43,400 Exelon Corp. 1,444,786
47,000 FirstEnergy Corp. 1,758,270
34,000 Pepco Hldgs., Inc. 621,520
------------
6,000,443
---------------------------------------------------------
Food and Staples Retailing -- 3.2%
46,600 Albertson's, Inc. 1,236,764
38,300 Costco Wholesale Corp. 1,572,981
------------
2,809,745
---------------------------------------------------------
Health Care Providers and Services -- 3.8%
5,400 Quest Diagnostics, Inc. 458,730
46,600 UnitedHealth Group 2,900,850
------------
3,359,580
---------------------------------------------------------
Household Products -- 1.3%
16,700 Kimberly-Clark Corp. 1,100,196
---------------------------------------------------------
Information Technology Services -- 1.1%
21,200 First Data Corp. 943,824
---------------------------------------------------------
Insurance -- 4.9%
26,400 AFLAC, Inc. 1,077,384
24,400 American Int'l. Group, Inc. 1,739,232
22,400 Hartford Financial Svcs. Group, Inc. 1,539,776
------------
4,356,392
---------------------------------------------------------
-----------------------------------------------------------
Shares Value
-----------------------------------------------------------
Machinery -- 3.1%
28,600 Illinois Tool Works, Inc. $ 2,742,454
---------------------------------------------------------
Media -- 7.1%
10,000 Gannett Co., Inc. 848,500
69,500 Interpublic Group Cos., Inc.* 954,235
125,000 Time Warner, Inc.* 2,197,500
64,500 Viacom, Inc. 2,303,940
-----------
6,304,175
---------------------------------------------------------
Multi-Utilities and Unregulated Power -- 1.4%
35,000 Sempra Energy 1,205,050
---------------------------------------------------------
Oil and Gas -- 8.1%
33,700 ConocoPhillips 2,570,973
103,600 Exxon Mobil Corp. 4,600,876
-----------
7,171,849
---------------------------------------------------------
Paper and Forest Products -- 1.0%
30,000 MeadWestvaco Corp. 881,700
---------------------------------------------------------
Pharmaceuticals -- 4.6%
40,500 Bristol-Myers Squibb Corp. 992,250
22,700 Johnson & Johnson 1,264,390
49,700 Wyeth 1,797,152
-----------
4,053,792
---------------------------------------------------------
Road and Rail -- 4.1%
46,400 Burlington Northern Santa Fe 1,627,248
59,800 CSX Corp. 1,959,646
-----------
3,586,894
---------------------------------------------------------
Thrifts and Mortgage Finance -- 3.1%
43,100 Federal Home Loan Mortgage Corp. 2,728,230
---------------------------------------------------------
Wireless Telecommunication Services -- 4.2%
139,500 Nextel Comm., Inc.* 3,719,070
---------------------------------------------------------
Total Common Stocks
(Cost $67,560,611) 85,383,467
---------------------------------------------------------
Exchange-Traded Fund -- 1.2%
9,600 S&P Depositary Receipts
Trust Series 1
exp. 12/31/2099
(Cost $1,009,544) $ 1,099,488
---------------------------------------------------------
Repurchase Agreement -- 2.1%
Principal
Amount Value
-----------------------------------------------------------
$ 1,861,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $1,861,070 at
1.35%, due 7/1/2004 (1)
(Cost $1,861,000) $ 1,861,000
---------------------------------------------------------
Total Investments -- 100.1%
(Cost $ 70,431,155) 88,343,955
Liabilities in Excess of Cash, Receivables and
Other Assets -- (0.1)% (118,834)
---------------------------------------------------------
Net Assets -- 100% $88,225,121
---------------------------------------------------------
* Non-income producing security.
(1)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
17
.. The Guardian Park Avenue Small Cap Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 99.3%
Shares Value
------------------------------------------------------------
Aerospace and Defense -- 2.7%
58,200 Aviall, Inc. $ 1,106,382
143,000 EDO Corp. 3,449,160
55,800 Sypris Solutions, Inc. 1,070,802
-------------
5,626,344
-----------------------------------------------------------
Air Freight and Logistics -- 1.2%
48,500 UTi Worldwide, Inc. 2,555,465
-----------------------------------------------------------
Airlines -- 1.6%
198,100 Skywest, Inc. 3,448,921
-----------------------------------------------------------
Auto Components -- 1.2%
67,200 American Axle & Mfg. Hldgs., Inc. 2,443,392
-----------------------------------------------------------
Beverages -- 0.7%
47,400 Cott Corp.* 1,535,760
-----------------------------------------------------------
Biotechnology -- 4.1%
139,000 Cell Therapeutics, Inc.* 1,024,430
74,400 ILEX Oncology, Inc.* 1,859,256
120,100 Immunicon Corp.* 943,986
87,000 Keryx Biopharmaceuticals, Inc.* 1,101,420
98,200 Nabi Biopharmaceuticals* 1,396,404
113,500 Protein Design Labs., Inc.* 2,171,255
-------------
8,496,751
-----------------------------------------------------------
Capital Markets -- 5.3%
143,500 Investors Financial Svcs. Corp. 6,253,730
107,500 Piper Jaffray Cos., Inc.* 4,862,225
-------------
11,115,955
-----------------------------------------------------------
Chemicals -- 0.8%
46,300 Georgia Gulf Corp. 1,660,318
-----------------------------------------------------------
Commercial Banks -- 3.4%
197,300 Boston Private Financial Hldgs., Inc. 4,569,468
55,500 Southwest Bancorp. of Texas, Inc. 2,448,660
-------------
7,018,128
-----------------------------------------------------------
Commercial Services and Supplies -- 2.2%
35,000 Banta Corp. 1,554,350
192,400 Labor Ready, Inc.* 2,982,200
-------------
4,536,550
-----------------------------------------------------------
Communications Equipment -- 1.9%
347,200 Arris Group, Inc.* 2,062,368
219,000 Symmetricom, Inc.* 1,949,100
-------------
4,011,468
-----------------------------------------------------------
Computers and Peripherals -- 2.2%
51,800 Applied Films Corp.* 1,503,236
46,900 PalmOne, Inc.* 1,630,713
74,700 Synaptics, Inc.* 1,430,505
-------------
4,564,454
-----------------------------------------------------------
Containers and Packaging -- 0.5%
25,700 Silgan Hldgs., Inc. 1,035,967
-----------------------------------------------------------
Diversified Financial Services -- 3.0%
98,300 Encore Capital Group, Inc.* 1,298,543
140,600 Financial Federal Corp.* 4,957,556
-------------
6,256,099
-----------------------------------------------------------
Diversified Telecommunication Services -- 1.2%
322,700 TALK America Hldgs., Inc.* 2,475,109
-----------------------------------------------------------
Electronic Equipment and Instruments -- 3.8%
77,700 Benchmark Electronics, Inc.* 2,261,070
------------------------------------------------------------
Shares Value
------------------------------------------------------------
152,700 Merix Corp.* $ 1,731,618
156,400 Plexus Corp.* 2,111,400
43,000 Varian, Inc.* 1,812,450
-------------
7,916,538
------------------------------------------------------------
Energy Equipment and Services -- 1.8%
396,800 Key Energy Svcs., Inc.* 3,745,792
------------------------------------------------------------
Food and Staples Retailing -- 1.4%
30,800 Performance Food Group Co.* 817,432
74,900 United Natural Foods, Inc.* 2,165,359
-------------
2,982,791
------------------------------------------------------------
Gas Utilities -- 0.7%
51,500 AGL Resources, Inc. 1,496,075
------------------------------------------------------------
Health Care Equipment and Supplies -- 5.3%
169,300 American Medical Systems Hldgs., Inc.* 5,705,410
107,400 Immucor, Inc.* 3,495,870
180,500 Synovis Life Technologies, Inc.* 1,940,375
-------------
11,141,655
------------------------------------------------------------
Hotels, Restaurants and Leisure -- 2.6%
84,000 Penn National Gaming, Inc.* 2,788,800
96,900 Red Robin Gourmet Burgers, Inc.* 2,652,153
-------------
5,440,953
------------------------------------------------------------
Household Durables -- 0.7%
41,600 Jarden Corp.* 1,497,184
------------------------------------------------------------
Information Technology Services -- 1.1%
173,500 Keane, Inc.* 2,375,215
------------------------------------------------------------
Insurance -- 2.9%
127,900 Direct General Corp. 4,126,054
59,000 ProAssurance Corp.* 2,012,490
-------------
6,138,544
------------------------------------------------------------
Internet Software and Services -- 2.7%
173,800 Netegrity, Inc.* 1,470,348
206,000 S1 Corp.* 2,047,640
119,700 United Online, Inc.* 2,107,917
-------------
5,625,905
------------------------------------------------------------
Machinery -- 4.1%
70,000 CLARCOR, Inc. 3,206,000
90,000 Trinity Inds., Inc. 2,861,100
90,900 Watts Water Technologies, Inc. 2,449,755
-------------
8,516,855
------------------------------------------------------------
Media -- 2.1%
209,100 Gray Television, Inc. 2,904,399
24,300 Media General, Inc. 1,560,546
-------------
4,464,945
------------------------------------------------------------
Metals and Mining -- 2.9%
159,400 Century Aluminum Co.* 3,951,526
366,300 Hecla Mining Co.* 2,087,910
-------------
6,039,436
------------------------------------------------------------
Multiline Retail -- 1.3%
173,300 99 Cents Only Stores* 2,642,825
------------------------------------------------------------
Oil and Gas -- 4.8%
326,400 Energy Partners Ltd.* 4,993,920
57,600 Forest Oil Corp.* 1,573,632
140,900 Magnum Hunter Resources, Inc.* 1,462,542
- --------------------------------------------------------------------------------
See notes to financial statements.
18
.. The Guardian Park Avenue Small Cap Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
---------------------------------------------------------
Shares Value
---------------------------------------------------------
138,000 Range Resources Corp. $ 2,014,800
------------
10,044,894
---------------------------------------------------------
Pharmaceuticals -- 4.3%
38,200 Medicis Pharmaceutical Corp. 1,526,090
190,200 Pain Therapeutics, Inc.* 1,533,012
101,900 Penwest Pharmaceuticals Co.* 1,305,339
47,300 Salix Pharmaceuticals Ltd.* 1,558,535
68,200 Taro Pharmaceutical Inds. Ltd. 2,966,700
------------
8,889,676
---------------------------------------------------------
Real Estate -- 3.4%
75,400 Arden Realty, Inc. 2,217,514
55,400 Federal Realty Investment Trust 2,304,086
68,100 Home Pptys., Inc. 2,654,538
------------
7,176,138
---------------------------------------------------------
Road and Rail -- 1.9%
185,925 Werner Enterprises, Inc. 3,923,017
---------------------------------------------------------
Semiconductors and Semiconductor Equipment -- 4.0%
102,800 Credence Systems Corp.* 1,418,640
110,100 Mattson Technology, Inc.* 1,323,402
168,100 Pericom Semiconductor Corp.* 1,800,351
92,700 Sigmatel, Inc.* 2,693,862
98,400 Silicon Storage Technology, Inc.* 1,013,520
------------
8,249,775
---------------------------------------------------------
Software -- 5.2%
243,500 Borland Software Corp.* 2,067,315
95,400 Bottomline Technologies, Inc.* 1,006,470
29,200 FactSet Research Systems, Inc. 1,380,284
285,900 Lawson Software, Inc.* 2,024,172
59,200 Manhattan Assoc., Inc.* 1,828,096
123,500 RSA Security, Inc.* 2,528,045
------------
10,834,382
---------------------------------------------------------
Specialty Retail -- 6.0%
144,800 Cost Plus, Inc.* 4,698,760
96,400 Group 1 Automotive, Inc.* 3,201,444
233,000 Movie Gallery, Inc. 4,555,150
------------
12,455,354
---------------------------------------------------------
Thrifts and Mortgage Finance -- 3.6%
182,800 Federal Agricultural Mortgage Corp.* 4,374,404
178,398 W Hldg. Co., Inc. 3,063,094
------------
7,437,498
---------------------------------------------------------
Wireless Telecommunication Services -- 0.7%
49,100 Western Wireless Corp.* 1,419,481
---------------------------------------------------------
Total Common Stocks
(Cost $176,011,942) 207,235,609
---------------------------------------------------------
Repurchase Agreement -- 2.5%
Principal
Amount Value
------------------------------------------------------------
$ 5,214,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $5,214,196 at
1.35%, due 7/1/2004 (1)
(Cost $5,214,000) $ 5,214,000
----------------------------------------------------------
Total Investments -- 101.8%
(Cost $181,225,942) 212,449,609
Liabilities in Excess of Cash, Receivables and
Other Assets -- (1.8)% (3,845,291)
----------------------------------------------------------
Net Assets -- 100% $208,604,318
----------------------------------------------------------
* Non-income producing security.
(1)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
19
.. The Guardian UBS Small Cap Value Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 95.9%
Shares Value
----------------------------------------------------------
Aerospace and Defense -- 2.5%
23,700 Esterline Technologies Corp.* $ 699,861
10,800 Triumph Group, Inc.* 344,844
------------
1,044,705
----------------------------------------------------------
Airlines -- 1.9%
36,200 Mesa Air Group, Inc.* 292,858
44,500 Pinnacle Airlines Corp.* 502,850
------------
795,708
----------------------------------------------------------
Auto Components -- 1.0%
11,300 American Axle & Mfg. Hldgs., Inc. 410,868
----------------------------------------------------------
Biotechnology -- 0.8%
16,300 Alkermes, Inc.* 221,680
7,700 Vicuron Pharmaceuticals, Inc.* 96,712
------------
318,392
----------------------------------------------------------
Building Products -- 0.4%
14,500 Apogee Enterprises, Inc. 150,800
----------------------------------------------------------
Chemicals -- 1.5%
17,300 Lubrizol Corp. 633,526
----------------------------------------------------------
Commercial Banks -- 8.3%
14,600 Boston Private Financial Hldgs., Inc. 338,136
37,100 Colonial BancGroup, Inc. 674,107
15,600 Cullen/Frost Bankers, Inc. 698,100
11,800 First BanCorp. 480,850
15,500 South Financial Group, Inc. 439,270
23,500 Trustmark Corp. 679,620
4,700 Vineyard National Bancorp Co. 187,483
------------
3,497,566
----------------------------------------------------------
Commercial Services and Supplies -- 5.5%
19,200 Jackson Hewitt Tax Svc., Inc.* 336,000
13,900 John H. Harland Co. 407,965
25,600 McGrath Rentcorp 945,920
21,400 Mobile Mini, Inc.* 607,974
------------
2,297,859
----------------------------------------------------------
Communications Equipment -- 1.8%
15,000 Harris Corp. 761,250
----------------------------------------------------------
Computers and Peripherals -- 1.0%
130,500 Quantum Corp.* 404,550
----------------------------------------------------------
Electric Utilities -- 1.2%
19,400 Hawaiian Electric Inds., Inc. 506,340
----------------------------------------------------------
Electrical Equipment -- 1.8%
33,900 Regal-Beloit Corp. 754,614
----------------------------------------------------------
Electronic Equipment and Instruments -- 3.5%
26,300 Methode Electronics, Inc. 341,111
25,700 Newport Corp.* 415,569
28,300 Park Electrochemical Corp. 714,575
------------
1,471,255
----------------------------------------------------------
Energy Equipment and Services -- 3.5%
20,600 Oceaneering Int'l., Inc.* 705,550
27,100 Offshore Logistics, Inc.* 762,052
------------
1,467,602
----------------------------------------------------------
Food Products -- 1.0%
23,700 Hain Celestial Group, Inc.* 428,970
----------------------------------------------------------
Gas Utilities -- 1.3%
18,500 AGL Resources, Inc. 537,425
----------------------------------------------------------
---------------------------------------------------------
Shares Value
---------------------------------------------------------
Health Care Equipment and Supplies -- 3.7%
32,400 Candela Corp.* $ 317,520
12,500 Haemonetics Corp.* 370,625
3,600 ICU Medical, Inc.* 120,708
18,000 Mentor Corp. 617,220
31,100 Theragenics Corp.* 143,682
------------
1,569,755
------------------------------------------------------
Health Care Providers and Services -- 4.4%
4,850 Coventry Health Care, Inc.* 237,165
11,900 Molina Healthcare, Inc.* 454,342
9,000 RehabCare Group, Inc.* 239,670
27,000 Renal Care Group, Inc.* 894,510
------------
1,825,687
------------------------------------------------------
Hotels, Restaurants and Leisure -- 1.9%
28,400 Bally Total Fitness Hldg. Corp.* 142,000
20,900 CBRL Group, Inc. 644,765
------------
786,765
------------------------------------------------------
Household Durables -- 5.4%
38,000 Department 56, Inc.* 585,200
24,600 Furniture Brands Int'l., Inc. 616,230
12,300 Libbey, Inc. 341,448
6,600 Ryland Group, Inc. 516,120
5,100 Stanley Furniture Co., Inc. 214,761
------------
2,273,759
------------------------------------------------------
Industrial Conglomerates -- 1.3%
16,500 ALLETE, Inc. 549,450
------------------------------------------------------
Information Technology Services -- 1.3%
40,800 Computer Task Group, Inc.* 161,160
45,400 SM&A* 392,710
------------
553,870
------------------------------------------------------
Insurance -- 4.1%
24,800 AmerUs Group Co. 1,026,720
9,100 Donegal Group, Inc. 182,364
12,500 Selective Insurance Group, Inc. 498,500
------------
1,707,584
------------------------------------------------------
Internet Software and Services -- 1.0%
99,900 Tumbleweed Comm. Corp.* 425,574
------------------------------------------------------
Machinery -- 1.3%
2,100 Gardner Denver, Inc.* 58,590
10,200 Harsco Corp. 479,400
------------
537,990
------------------------------------------------------
Media -- 1.8%
23,600 Radio One, Inc.* 377,836
20,000 Saga Comm., Inc.* 365,000
------------
742,836
------------------------------------------------------
Metals and Mining -- 1.6%
13,900 Quanex Corp. 676,930
------------------------------------------------------
Multi-Utilities and Unregulated Power -- 3.0%
24,100 Equitable Resources, Inc. 1,246,211
------------------------------------------------------
Oil and Gas -- 1.6%
22,700 Cimarex Energy Co.* 686,221
------------------------------------------------------
Personal Products -- 1.2%
20,300 Nu Skin Enterprises, Inc. 513,996
------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
20
.. The Guardian UBS Small Cap Value Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
---------------------------------------------------------
Shares Value
---------------------------------------------------------
Pharmaceuticals -- 0.3%
18,500 Advancis Pharmaceutical Corp.* $ 125,615
------------------------------------------------------
Real Estate -- 5.1%
20,507 Government Pptys. Trust, Inc. 214,298
28,600 Innkeepers USA Trust 294,866
14,700 Parkway Pptys., Inc. 653,415
8,000 SL Green Realty Corp. 374,400
22,700 Thornburg Mortgage, Inc. 611,765
------------
2,148,744
------------------------------------------------------
Road and Rail -- 3.5%
19,950 Genesee & Wyoming, Inc.* 472,815
22,400 Werner Enterprises, Inc. 472,640
13,100 Yellow Roadway Corp.* 522,166
------------
1,467,621
------------------------------------------------------
Semiconductors and Semiconductor Equipment -- 1.8%
26,300 Dupont Photomasks, Inc.* 534,679
17,900 Integrated Silicon Solution, Inc.* 218,559
------------
753,238
------------------------------------------------------
Software -- 3.1%
25,300 Mentor Graphics Corp.* 391,391
34,200 MSC.Software Corp.* 306,090
26,200 Reynolds & Reynolds Co. 606,006
------------
1,303,487
------------------------------------------------------
Specialty Retail -- 5.5%
12,200 Hollywood Entertainment Corp.* 162,992
16,100 Linens'n Things, Inc.* 471,891
6,900 Michaels Stores, Inc. 379,500
41,900 Party City Corp.* 523,331
17,300 Rent-A-Center, Inc.* 517,789
7,600 Sharper Image Corp.* 238,564
------------
2,294,067
------------------------------------------------------
Thrifts and Mortgage Finance -- 6.0%
21,400 Accredited Home Lenders Hldg. Co.* 602,410
10,500 Independence Community Bank Corp. 382,200
29,700 IndyMac Bancorp, Inc. 938,520
48,100 Ocwen Financial Corp.* 579,124
------------
2,502,254
------------------------------------------------------
Total Common Stocks
(Cost $32,918,928) 40,173,084
------------------------------------------------------
Exchange-Traded Fund -- 0.9%
2,200 iShares Russell 2000
Value Index Fund
(Cost $370,712) $ 379,060
------------------------------------------------------
Mutual Fund -- 1.1%
34,100 Apollo Investment Corp.*
(Cost $503,772) $ 469,557
------------------------------------------------------
Repurchase Agreement -- 2.1%
Principal
Amount Value
-----------------------------------------------------------
$ 896,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $896,034 at
1.35%, due 7/1/2004 (1)
(Cost $896,000) $ 896,000
----------------------------------------------------------
Total Investments -- 100.0%
(Cost $34,689,412) 41,917,701
Liabilities in Excess of Cash, Receivables and
Other Assets -- (0.0)% (1,188)
----------------------------------------------------------
Net Assets -- 100% $41,916,513
----------------------------------------------------------
* Non-income producing security.
(1)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
21
.. The Guardian Asset Allocation Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 14.3%
Shares Value
---------------------------------------------------
Aerospace and Defense -- 0.3%
3,044 Boeing Co. $ 155,518
2,736 Honeywell Int'l., Inc. 100,220
1,046 Lockheed Martin Corp. 54,476
1,212 Northrop Grumman Corp. 65,084
1,924 Raytheon Co. 68,821
318 United Technologies Corp. 29,091
-------------
473,210
---------------------------------------------------
Air Freight and Logistics -- 0.1%
2,119 United Parcel Svc., Inc. 159,285
---------------------------------------------------
Airlines -- 0.0%
2,503 Southwest Airlines Co. 41,975
---------------------------------------------------
Automobiles -- 0.2%
5,835 Ford Motor Co. 91,318
2,438 General Motors Corp. 113,586
1,219 Harley-Davidson, Inc. 75,505
-------------
280,409
---------------------------------------------------
Beverages -- 0.4%
2,438 Anheuser-Busch Cos., Inc. 131,652
4,595 Coca-Cola Co. 231,955
3,197 Coca-Cola Enterprises, Inc. 92,681
2,867 PepsiCo., Inc. 154,474
2,305 The Pepsi Bottling Group, Inc. 70,395
-------------
681,157
---------------------------------------------------
Biotechnology -- 0.2%
2,242 Amgen, Inc.* 122,346
917 Biogen Idec, Inc.* 58,000
1,035 Chiron Corp.* 46,203
1,726 MedImmune, Inc.* 40,388
-------------
266,937
---------------------------------------------------
Building Products -- 0.0%
2,608 Masco Corp. 81,317
---------------------------------------------------
Capital Markets -- 0.5%
2,547 Bank of New York, Inc. 75,086
8,048 Charles Schwab Corp. 77,341
1,000 Goldman Sachs Group, Inc. 94,160
5,066 J.P. Morgan Chase & Co. 196,409
980 Lehman Brothers Hldgs., Inc. 73,745
2,356 Mellon Financial Corp. 69,101
410 Merrill Lynch & Co., Inc. 22,132
3,352 Morgan Stanley 176,885
57 State Street Corp. 2,795
-------------
787,654
---------------------------------------------------
Chemicals -- 0.2%
567 Dow Chemical Co. 23,077
3,035 E.I. Du Pont de Nemours & Co. 134,815
1,085 Monsanto Co. 41,772
1,174 PPG Inds., Inc. 73,363
1,770 Rohm & Haas Co. 73,597
-------------
346,624
---------------------------------------------------
Commercial Banks -- 0.8%
7,097 Bank of America Corp. 600,548
1,872 BB&T Corp. 69,208
2,217 Fifth Third Bancorp 119,230
1,410 KeyCorp 42,145
3,312 U.S. Bancorp 91,279
4,992 Wachovia Corp. 222,144
------------------------------------------------------------
Shares Value
------------------------------------------------------------
3,950 Wells Fargo & Co. $ 226,058
-------------
1,370,612
------------------------------------------------------
Commercial Services and Supplies -- 0.2%
5,396 Cendant Corp. 132,094
1,807 Cintas Corp. 86,140
1,630 Pitney Bowes, Inc. 72,128
2,779 Waste Management, Inc. 85,176
-------------
375,538
------------------------------------------------------
Communications Equipment -- 0.4%
15,125 Cisco Systems, Inc.* 358,462
6,482 Corning, Inc.* 84,655
6,075 Motorola, Inc. 110,869
2,384 QUALCOMM, Inc. 173,984
-------------
727,970
------------------------------------------------------
Computers and Peripherals -- 0.5%
4,776 Dell, Inc.* 171,076
5,386 EMC Corp.* 61,400
8,215 Hewlett Packard Co. 173,337
4,066 Int'l. Business Machines 358,418
12,916 Sun Microsystems, Inc.* 56,055
-------------
820,286
------------------------------------------------------
Consumer Finance -- 0.2%
1,972 American Express Co. 101,321
146 Capital One Financial Corp. 9,984
4,750 MBNA Corp. 122,503
2,265 SLM Corp. 91,619
-------------
325,427
------------------------------------------------------
Distributors -- 0.1%
2,967 Genuine Parts Co. 117,731
------------------------------------------------------
Diversified Financial Services -- 0.3%
11,373 Citigroup, Inc. 528,844
------------------------------------------------------
Diversified Telecommunication Services -- 0.4%
1,564 ALLTEL Corp. 79,170
1,989 AT & T Corp. 29,099
5,078 BellSouth Corp. 133,145
5,290 SBC Comm., Inc. 128,283
1,710 Sprint Corp. (FON Group) 30,096
4,971 Verizon Comm. 179,900
-------------
579,693
------------------------------------------------------
Electric Utilities -- 0.2%
1,705 Entergy Corp. 95,497
1,050 Exelon Corp. 34,955
1,214 FPL Group, Inc. 77,635
1,395 Progress Energy, Inc. 61,450
2,650 Southern Co. 77,247
1,292 TXU Corp. 52,339
-------------
399,123
------------------------------------------------------
Electrical Equipment -- 0.1%
424 Cooper Inds. Ltd. 25,190
1,106 Emerson Electric Co. 70,286
-------------
95,476
------------------------------------------------------
Electronic Equipment and Instruments -- 0.1%
2,990 Agilent Technologies, Inc.* 87,547
4,723 Solectron Corp.* 30,558
-------------
118,105
------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
22
.. The Guardian Asset Allocation Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
--------------------------------------------------------
Shares Value
--------------------------------------------------------
Energy Equipment and Services -- 0.1%
2,205 Baker Hughes, Inc. $ 83,018
1,681 Schlumberger Ltd. 106,761
-------------
189,779
-------------------------------------------------------
Food and Staples Retailing -- 0.5%
840 Albertson's, Inc. 22,294
2,620 CVS Corp. 110,092
2,409 Kroger Co.* 43,844
1,099 Safeway, Inc.* 27,849
10,695 Wal-Mart Stores, Inc. 564,268
-------------
768,347
-------------------------------------------------------
Food Products -- 0.3%
2,194 Archer-Daniels-Midland Co. 36,815
2,621 Campbell Soup Co. 70,453
2,662 ConAgra Foods, Inc. 72,087
928 General Mills, Inc. 44,108
2,424 H.J. Heinz Co. 95,021
1,334 Hershey Foods Corp. 61,724
2,012 Kellogg Co. 84,202
1,269 W.M. Wrigley Jr. Co. 80,010
-------------
544,420
-------------------------------------------------------
Health Care Equipment and Supplies -- 0.5%
2,128 Baxter Int'l., Inc. 73,437
2,122 Becton Dickinson & Co., Inc. 109,920
2,932 Boston Scientific Corp.* 125,490
272 C.R. Bard, Inc. 15,409
2,016 Guidant Corp. 112,654
1,756 Medtronic, Inc. 85,552
1,442 St. Jude Medical, Inc.* 109,087
1,188 Stryker Corp. 65,340
884 Zimmer Hldgs., Inc. 77,969
-------------
774,858
-------------------------------------------------------
Health Care Providers and Services -- 0.2%
998 AmerisourceBergen Corp. 59,660
746 Cigna Corp. 51,332
306 HCA, Inc. 12,727
3,629 Health Management Associates, Inc. 81,362
1,178 McKesson Corp. 40,441
1,512 Tenet Healthcare Corp.* 20,276
929 Wellpoint Health Networks, Inc.* 104,057
-------------
369,855
-------------------------------------------------------
Hotels, Restaurants and Leisure -- 0.2%
2,190 Carnival Corp. 102,930
2,751 McDonald's Corp. 71,526
2,943 Starbucks Corp.* 127,962
-------------
302,418
-------------------------------------------------------
Household Products -- 0.3%
614 Clorox Co. 33,021
1,955 Kimberly-Clark Corp. 128,795
5,120 Procter & Gamble Co. 278,733
-------------
440,549
-------------------------------------------------------
Industrial Conglomerates -- 0.7%
2,236 3M Co. 201,262
23,903 General Electric Co. 774,457
6,224 Tyco Int'l. Ltd. 206,264
-------------
1,181,983
-------------------------------------------------------
Information Technology Services -- 0.3%
2,142 Automatic Data Processing, Inc. 89,707
2,525 Electronic Data Systems Corp. 48,354
-----------------------------------------------------------
Shares Value
-----------------------------------------------------------
4,416 First Data Corp. $ 196,600
957 Paychex, Inc. 32,423
1,608 Sabre Hldgs. Corp. 44,558
-------------
411,642
----------------------------------------------------------
Insurance -- 0.7%
2,353 AFLAC, Inc. 96,026
2,008 Allstate Corp. 93,472
5,515 American Int'l. Group, Inc. 393,109
1,281 Chubb Corp. 87,339
186 Loews Corp. 11,153
1,308 Manulife Financial Corp. 52,974
2,164 Marsh & McLennan Cos., Inc. 98,202
2,884 MetLife, Inc. 103,391
1,253 Progressive Corp. 106,881
687 St. Paul Travelers Cos., Inc. 27,836
-------------
1,070,383
----------------------------------------------------------
Internet Software and Services -- 0.0%
1,884 Yahoo! Inc.* 68,446
----------------------------------------------------------
Leisure Equipment and Products -- 0.1%
1,149 Eastman Kodak Co. 31,000
3,448 Mattel, Inc. 62,926
-------------
93,926
----------------------------------------------------------
Machinery -- 0.2%
1,626 Caterpillar, Inc. 129,169
1,491 Deere & Co. 104,579
2,138 Dover Corp. 90,010
-------------
323,758
----------------------------------------------------------
Media -- 0.5%
2,046 Clear Channel Comm., Inc. 75,600
3,217 Comcast Corp. -- Class A* 90,172
216 Comcast Corp. -- Class A Special* 5,964
629 Gannett Co., Inc. 53,371
1,395 New York Times Co. 62,370
11,612 Time Warner, Inc.* 204,139
77 Tribune Co. 3,507
4,849 Viacom, Inc. 173,206
5,567 Walt Disney Co. 141,903
-------------
810,232
----------------------------------------------------------
Metals and Mining -- 0.0%
2,364 Alcoa, Inc. 78,083
----------------------------------------------------------
Multiline Retail -- 0.1%
1,602 Kohl's Corp.* 67,733
481 Target Corp. 20,428
-------------
88,161
----------------------------------------------------------
Multi-Utilities and Unregulated Power -- 0.1%
3,468 AES Corp.* 34,437
4,604 Duke Energy Corp. 93,415
1,682 Public Svc. Enterprise Group, Inc. 67,331
-------------
195,183
----------------------------------------------------------
Oil and Gas -- 0.8%
1,406 Anadarko Petroleum Corp. 82,392
294 Burlington Resources, Inc. 10,637
2,887 ChevronTexaco Corp. 271,695
1,233 ConocoPhillips 94,066
3,136 El Paso Corp. 24,712
14,298 Exxon Mobil Corp. 634,974
2,571 Unocal Corp. 97,698
3,916 Williams Cos., Inc. 46,600
-------------
1,262,774
----------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
23
.. The Guardian Asset Allocation Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
--------------------------------------------------------
Shares Value
--------------------------------------------------------
Paper and Forest Products -- 0.1%
2,952 Georgia-Pacific Corp. $ 109,165
-------------------------------------------------------
Personal Products -- 0.1%
2,752 Avon Products, Inc. 126,977
2,784 Gillette Co. 118,042
-------------
245,019
-------------------------------------------------------
Pharmaceuticals -- 1.0%
1,116 Allergan, Inc. 99,904
6,462 Bristol-Myers Squibb Corp. 158,319
3,549 Eli Lilly & Co. 248,111
1,774 Forest Laboratories, Inc.* 100,462
6,872 Johnson & Johnson 382,770
1,779 King Pharmaceuticals, Inc.* 20,370
17,915 Pfizer, Inc. 614,126
3,875 Schering-Plough Corp. 71,610
-------------
1,695,672
-------------------------------------------------------
Real Estate -- 0.1%
2,383 Plum Creek Timber Co., Inc. 77,638
1,972 Simon Ppty. Group, Inc. 101,400
-------------
179,038
-------------------------------------------------------
Road and Rail -- 0.1%
2,352 Burlington Northern Santa Fe 82,485
1,674 Union Pacific Corp. 99,519
-------------
182,004
-------------------------------------------------------
Semiconductors and Semiconductor Equipment -- 0.6%
2,923 Altera Corp.* 64,949
754 Analog Devices, Inc. 35,498
4,648 Applied Materials, Inc.* 91,194
1,688 Broadcom Corp.* 78,948
13,630 Intel Corp. 376,188
1,448 KLA-Tencor Corp.* 71,502
549 Linear Technology Corp. 21,669
794 Maxim Integrated Products, Inc. 41,621
3,302 Micron Technology, Inc.* 50,554
1,503 Texas Instruments, Inc. 36,343
2,346 Xilinx, Inc. 78,145
-------------
946,611
-------------------------------------------------------
Software -- 0.6%
1,802 Adobe Systems, Inc. 83,793
3,590 Computer Associates Int'l., Inc. 100,736
23,245 Microsoft Corp. 663,877
2,830 Siebel Systems, Inc.* 30,224
2,739 VERITAS Software Corp.* 75,870
-------------
954,500
-------------------------------------------------------
Specialty Retail -- 0.3%
1,416 Bed, Bath & Beyond, Inc.* 54,445
1,930 Best Buy Co., Inc. 97,928
3,143 Home Depot, Inc. 110,634
2,415 Lowe's Cos., Inc. 126,908
432 Staples, Inc. 12,662
5,047 The Gap, Inc. 122,390
-------------
524,967
-------------------------------------------------------
Textiles, Apparel and Luxury Goods -- 0.1%
1,255 NIKE, Inc. 95,066
-------------------------------------------------------
Thrifts and Mortgage Finance -- 0.2%
1,850 Federal National Mortgage Assn. 132,016
4,145 Washington Mutual, Inc. 160,163
-------------
292,179
-------------------------------------------------------
---------------------------------------------------------------
Shares Value
---------------------------------------------------------------
Tobacco -- 0.2%
5,316 Altria Group, Inc. $ 266,066
509 UST, Inc. 18,324
-------------
284,390
---------------------------------------------------------------
Wireless Telecommunication Services -- 0.1%
12,777 AT & T Wireless Svcs., Inc.* 182,967
---------------------------------------------------------------
Total Common Stocks
(Cost $24,127,994) 23,243,748
---------------------------------------------------------------
Mutual Funds -- 81.3%
Equity -- 73.6%
15,277,311 The Guardian S&P 500 Index Fund,
Class A (1)+ $ 119,621,343
---------------------------------------------------------------
Fixed Income -- 7.7%
1,264,491 The Guardian Investment Quality Bond
Fund, Class A (2) 12,467,877
---------------------------------------------------------------
Total Mutual Funds
(Cost $144,499,729) 132,089,220
---------------------------------------------------------------
U.S. Government Security -- 1.1%
Principal
Amount Value
---------------------------------------------------------------
$ 1,900,000 U.S. Treasury Bill
0.94%, 7/29/2004 (3)
(Cost $1,898,611) $ 1,898,611
---------------------------------------------------------------
Repurchase Agreement -- 3.4%
$ 5,498,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $5,498,206 at
1.35%, due 7/1/2004 (4)
(Cost $5,498,000) $ 5,498,000
---------------------------------------------------------------
Total Investments -- 100.1%
(Cost $176,024,334) 162,729,579
Liabilities in Excess of Cash, Receivables and
Other Assets -- (0.1)% (240,588)
---------------------------------------------------------------
Net Assets -- 100% $ 162,488,991
---------------------------------------------------------------
* Non-income producing security.
+ The Guardian S&P 500 Index Fund financials are included herein.
(1)Majority-owned subsidiary.
(2)Affiliated issuer.
(3)The U.S. Treasury Bill is segregated as collateral to cover margin
requirements on open futures contracts.
(4)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
Purchased (P)/Sold (S) Futures Contracts
Unrealized
Appreciation/
Contracts Type Description Expiration (Depreciation)
-------------------------------------------------------------
114 S U.S. Treasury Notes,
5 Year 9/2004 $ (57,000)
67 P S&P 500 Index 9/2004 77,050
------------
$ 20,050
-------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
24
.. The Guardian S&P 500 Index Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 97.2%
----------------------------------------------------
Shares Value
----------------------------------------------------
Aerospace and Defense -- 1.9%
12,788 Boeing Co. $ 653,339
3,125 General Dynamics Corp. 310,313
2,343 Goodrich Corp. 75,749
13,224 Honeywell Int'l., Inc. 484,395
6,804 Lockheed Martin Corp. 354,352
5,740 Northrop Grumman Corp. 308,238
6,629 Raytheon Co. 237,119
2,645 Rockwell Collins, Inc. 88,131
7,755 United Technologies Corp. 709,428
--------------
3,221,064
----------------------------------------------------
Air Freight and Logistics -- 1.0%
4,550 FedEx Corp. 371,689
810 Ryder Systems, Inc. 32,457
17,015 United Parcel Svc., Inc. 1,279,018
--------------
1,683,164
----------------------------------------------------
Airlines -- 0.1%
1,785 Delta Airlines, Inc. 12,709
12,232 Southwest Airlines Co. 205,131
--------------
217,840
----------------------------------------------------
Auto Components -- 0.2%
945 Cooper Tire & Rubber Co. 21,735
2,085 Dana Corp. 40,866
8,041 Delphi Corp. 85,878
4,365 Goodyear Tire & Rubber Co.* 39,678
2,858 Johnson Controls, Inc. 152,560
1,852 Visteon Corp. 21,613
--------------
362,330
----------------------------------------------------
Automobiles -- 0.7%
28,159 Ford Motor Co. 440,688
8,879 General Motors Corp. 413,673
4,838 Harley-Davidson, Inc. 299,666
--------------
1,154,027
----------------------------------------------------
Beverages -- 2.6%
525 Adolph Coors Co. 37,979
11,891 Anheuser-Busch Cos., Inc. 642,114
1,990 Brown-Forman Corp. 96,057
37,132 Coca-Cola Co. 1,874,424
7,664 Coca-Cola Enterprises, Inc. 222,179
25,965 PepsiCo., Inc. 1,398,994
4,359 The Pepsi Bottling Group, Inc. 133,124
--------------
4,404,871
----------------------------------------------------
Biotechnology -- 1.1%
19,558 Amgen, Inc.* 1,067,280
5,022 Biogen Idec, Inc.* 317,642
2,723 Chiron Corp.* 121,555
3,379 Genzyme Corp.* 159,928
3,661 MedImmune, Inc.* 85,667
--------------
1,752,072
----------------------------------------------------
Building Products -- 0.2%
3,186 American Standard Cos., Inc.* 128,428
7,483 Masco Corp. 233,320
--------------
361,748
----------------------------------------------------
Capital Markets -- 3.4%
11,877 Bank of New York, Inc. 350,134
1,537 Bear Stearns Cos., Inc. 129,584
19,889 Charles Schwab Corp. 191,133
-------------------------------------------------------
Shares Value
-------------------------------------------------------
5,500 E*TRADE Financial Corp.* $ 61,325
1,600 Federated Investors, Inc. 48,544
3,801 Franklin Resources, Inc. 190,354
7,166 Goldman Sachs Group, Inc. 674,750
31,680 J.P. Morgan Chase & Co. 1,228,234
3,184 Janus Capital Group, Inc. 52,504
4,199 Lehman Brothers Hldgs., Inc. 315,975
6,309 Mellon Financial Corp. 185,043
15,654 Merrill Lynch & Co., Inc. 845,003
16,508 Morgan Stanley 871,127
3,195 Northern Trust Corp. 135,085
5,114 State Street Corp. 250,791
1,728 T. Rowe Price Group, Inc. 87,091
--------------
5,616,677
-------------------------------------------------------
Chemicals -- 1.5%
3,281 Air Products & Chemicals, Inc. 172,088
14,085 Dow Chemical Co. 573,260
15,009 E.I. Du Pont de Nemours & Co. 666,700
1,083 Eastman Chemical Co. 50,067
4,653 Ecolab, Inc. 147,500
1,823 Engelhard Corp. 58,901
685 Great Lakes Chemical Corp. 18,536
1,497 Hercules, Inc.* 18,248
1,377 Int'l. Flavors & Fragrances, Inc. 51,500
3,976 Monsanto Co. 153,076
2,774 PPG Inds., Inc. 173,347
5,132 Praxair, Inc. 204,818
3,834 Rohm & Haas Co. 159,418
1,093 Sigma-Aldrich 65,154
--------------
2,512,613
-------------------------------------------------------
Commercial Banks -- 6.1%
5,373 AmSouth Bancorporation 136,850
31,488 Bank of America Corp. 2,664,515
17,177 Bank One Corp. 876,027
8,563 BB&T Corp. 316,574
4,202 Charter One Financial, Inc. 185,687
2,548 Comerica, Inc. 139,834
8,646 Fifth Third Bancorp 464,982
1,845 First Horizon Nat'l. Corp. 83,892
3,600 Huntington Bancshares, Inc. 82,440
6,165 KeyCorp 184,272
1,800 M & T Bank Corp. 157,140
3,714 Marshall & Ilsley Corp. 145,180
9,265 National City Corp. 324,368
2,405 North Fork Bancorporation, Inc. 91,510
4,177 PNC Financial Svcs. Group 221,715
3,484 Regions Financial Corp. 127,340
4,873 SouthTrust Corp. 189,121
4,276 SunTrust Banks, Inc. 277,897
4,926 Synovus Financial Corp. 124,727
30,104 U.S. Bancorp 829,666
2,982 Union Planters Corp. 88,894
20,178 Wachovia Corp. 897,921
25,987 Wells Fargo & Co. 1,487,236
1,438 Zions Bancorporation 88,365
--------------
10,186,153
-------------------------------------------------------
Commercial Services and Supplies -- 1.1%
4,995 Allied Waste Inds., Inc.* 65,834
2,845 Apollo Group, Inc.* 251,185
1,581 Avery Dennison Corp. 101,200
15,262 Cendant Corp. 373,614
2,425 Cintas Corp. 115,600
- --------------------------------------------------------------------------------
See notes to financial statements.
25
.. The Guardian S&P 500 Index Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
-----------------------------------------------------
Shares Value
-----------------------------------------------------
997 Deluxe Corp. $ 43,370
2,052 Equifax, Inc. 50,787
2,604 H & R Block, Inc. 124,159
1,707 Monster Worldwide, Inc.* 43,904
3,634 Pitney Bowes, Inc. 160,804
4,423 R.R. Donnelley & Sons Co. 146,047
2,547 Robert Half Int'l., Inc. 75,824
8,974 Waste Management, Inc. 275,053
--------------
1,827,381
----------------------------------------------------
Communications Equipment -- 3.0%
11,132 ADC Telecomm., Inc.* 31,615
2,400 Andrew Corp.* 48,024
6,102 Avaya, Inc.* 96,351
7,613 CIENA Corp.* 28,320
106,642 Cisco Systems, Inc.* 2,527,415
2,380 Comverse Technology, Inc.* 47,457
20,197 Corning, Inc.* 263,773
18,734 JDS Uniphase Corp.* 71,002
67,556 Lucent Technologies, Inc.* 255,362
35,440 Motorola, Inc. 646,780
1,349 QLogic Corp.* 35,870
12,102 QUALCOMM, Inc. 883,204
2,311 Scientific Atlanta, Inc. 79,729
5,897 Tellabs, Inc.* 51,540
--------------
5,066,442
----------------------------------------------------
Computers and Peripherals -- 3.5%
6,053 Apple Computer, Inc.* 196,965
38,726 Dell, Inc.* 1,387,165
36,868 EMC Corp.* 420,295
4,621 Gateway, Inc.* 20,794
46,798 Hewlett Packard Co. 987,438
26,281 Int'l. Business Machines 2,316,670
1,823 Lexmark Int'l. Group, Inc.* 175,974
1,379 NCR Corp.* 68,385
5,702 Network Appliance, Inc.* 122,764
46,932 Sun Microsystems, Inc.* 203,685
--------------
5,900,135
----------------------------------------------------
Construction and Engineering -- 0.0%
1,050 Fluor Corp. 50,054
----------------------------------------------------
Construction Materials -- 0.0%
1,439 Vulcan Materials Co. 68,424
----------------------------------------------------
Consumer Finance -- 1.3%
19,651 American Express Co. 1,009,668
3,450 Capital One Financial Corp. 235,911
19,217 MBNA Corp. 495,607
4,111 Providian Financial Corp.* 60,308
7,101 SLM Corp. 287,236
--------------
2,088,730
----------------------------------------------------
Containers and Packaging -- 0.2%
813 Ball Corp. 58,577
1,504 Bemis Co., Inc. 42,488
2,261 Pactiv Corp.* 56,389
2,781 Sealed Air Corp.* 148,144
697 Temple-Inland, Inc. 48,267
--------------
353,865
----------------------------------------------------
Distributors -- 0.1%
2,486 Genuine Parts Co. 98,645
----------------------------------------------------
Diversified Financial Services -- 2.4%
78,862 Citigroup, Inc. 3,667,083
2,359 Moody's Corp. 152,533
-------------------------------------------------------------
Shares Value
-------------------------------------------------------------
5,116 Principal Financial Group, Inc. $ 177,934
--------------
3,997,550
------------------------------------------------------------
Diversified Telecommunication Services -- 2.7%
4,514 ALLTEL Corp. 228,499
12,198 AT & T Corp. 178,457
28,012 BellSouth Corp. 734,475
1,992 CenturyTel, Inc. 59,840
6,319 Citizens Comm. Co.* 76,460
30,623 Qwest Comm. Int'l., Inc.* 109,936
50,060 SBC Comm., Inc. 1,213,955
21,364 Sprint Corp. (FON Group) 376,006
41,885 Verizon Comm. 1,515,818
--------------
4,493,446
------------------------------------------------------------
Electric Utilities -- 1.8%
1,753 Allegheny Energy, Inc.* 27,014
2,471 Ameren Corp. 106,154
6,284 American Electric Power, Inc. 201,088
4,248 CenterPoint Energy, Inc. 48,852
2,886 CiNergy Corp. 109,668
1,896 CMS Energy Corp.* 17,310
3,075 Consolidated Edison, Inc. 122,262
2,578 DTE Energy Co. 104,512
4,648 Edison Int'l. 118,849
3,618 Entergy Corp. 202,644
9,904 Exelon Corp. 329,704
5,049 FirstEnergy Corp. 188,883
2,907 FPL Group, Inc. 185,903
6,344 PG&E Corp.* 177,251
1,212 Pinnacle West Capital Corp. 48,953
2,692 PPL Corp. 123,563
4,069 Progress Energy, Inc. 179,239
12,246 Southern Co. 356,971
2,624 TECO Energy, Inc. 31,462
4,937 TXU Corp. 199,998
6,601 Xcel Energy, Inc. 110,303
--------------
2,990,583
------------------------------------------------------------
Electrical Equipment -- 0.4%
2,786 American Power Conversion Corp. 54,745
1,359 Cooper Inds. Ltd. 80,738
6,564 Emerson Electric Co. 417,142
1,094 Power-One, Inc.* 12,012
2,645 Rockwell Automation, Inc. 99,214
767 Thomas & Betts Corp.* 20,886
--------------
684,737
------------------------------------------------------------
Electronic Equipment and Instruments -- 0.5%
7,382 Agilent Technologies, Inc.* 216,145
2,726 Jabil Circuit, Inc.* 68,641
2,802 Molex, Inc. 89,888
2,010 PerkinElmer, Inc. 40,280
7,816 Sanmina-SCI Corp.* 71,126
12,349 Solectron Corp.* 79,898
3,132 Symbol Technologies, Inc. 46,166
1,336 Tektronix, Inc. 45,451
2,568 Thermo Electron Corp.* 78,940
2,045 Waters Corp.* 97,710
--------------
834,245
------------------------------------------------------------
Energy Equipment and Services -- 0.9%
2,317 B.J. Svcs. Co.* 106,211
5,564 Baker Hughes, Inc. 209,485
6,355 Halliburton Co. 192,302
2,092 Nabors Inds., Inc. 94,600
- --------------------------------------------------------------------------------
See notes to financial statements.
26
.. The Guardian S&P 500 Index Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
---------------------------------------------------------
Shares Value
---------------------------------------------------------
2,008 Noble Corp. $ 76,083
1,317 Rowan Cos., Inc.* 32,043
9,003 Schlumberger Ltd. 571,780
5,572 Transocean, Inc.* 161,254
--------------
1,443,758
--------------------------------------------------------
Food and Staples Retailing -- 3.4%
5,902 Albertson's, Inc. 156,639
7,059 Costco Wholesale Corp. 289,913
6,301 CVS Corp. 264,768
11,800 Kroger Co.* 214,760
7,230 Safeway, Inc.* 183,208
1,885 Supervalu, Inc. 57,700
9,731 Sysco Corp. 349,051
66,196 Wal-Mart Stores, Inc. 3,492,501
15,872 Walgreen Co. 574,725
2,010 Winn-Dixie Stores, Inc. 14,472
--------------
5,597,737
--------------------------------------------------------
Food Products -- 1.3%
9,568 Archer-Daniels-Midland Co. 160,551
6,069 Campbell Soup Co. 163,135
8,628 ConAgra Foods, Inc. 233,646
5,846 General Mills, Inc. 277,860
5,823 H.J. Heinz Co. 228,262
3,920 Hershey Foods Corp. 181,378
6,444 Kellogg Co. 269,682
1,968 McCormick & Co., Inc. 66,912
12,269 Sara Lee Corp. 282,064
3,730 W.M. Wrigley Jr. Co. 235,177
--------------
2,098,667
--------------------------------------------------------
Gas Utilities -- 0.1%
2,616 KeySpan Corp. 96,007
674 NICOR, Inc. 22,896
4,276 NiSource, Inc. 88,171
527 Peoples Energy Corp. 22,213
--------------
229,287
--------------------------------------------------------
Health Care Equipment and Supplies -- 2.1%
3,019 Applera Corp.-Applied Biosystems
Group 65,663
755 Bausch & Lomb, Inc. 49,128
9,370 Baxter Int'l., Inc. 323,359
3,689 Becton Dickinson & Co., Inc. 191,090
3,846 Biomet, Inc. 170,916
12,482 Boston Scientific Corp.* 534,230
1,442 C.R. Bard, Inc. 81,689
4,822 Guidant Corp. 269,453
2,380 Hospira, Inc.* 65,688
18,280 Medtronic, Inc. 890,601
653 Millipore Corp.* 36,810
2,817 St. Jude Medical, Inc.* 213,106
6,194 Stryker Corp. 340,670
3,813 Zimmer Hldgs., Inc. 336,307
--------------
3,568,710
--------------------------------------------------------
Health Care Providers and Services -- 2.1%
2,336 Aetna, Inc. 198,560
1,854 AmerisourceBergen Corp. 110,832
2,046 Anthem, Inc.* 183,240
6,958 Cardinal Health, Inc. 487,408
6,800 Caremark Rx, Inc.* 223,992
2,221 Cigna Corp. 152,827
1,165 Express Scripts, Inc.* 92,303
7,462 HCA, Inc. 310,345
3,671 Health Management Associates, Inc. 82,304
-------------------------------------------------------
Shares Value
-------------------------------------------------------
2,389 Humana, Inc.* $ 40,374
3,317 IMS Health, Inc. 77,750
1,456 Manor Care, Inc. 47,582
4,085 McKesson Corp. 140,238
4,011 Medco Health Solutions, Inc.* 150,413
1,738 Quest Diagnostics, Inc. 147,643
6,941 Tenet Healthcare Corp.* 93,079
9,720 UnitedHealth Group 605,070
2,438 Wellpoint Health Networks, Inc.* 273,080
--------------
3,417,040
-------------------------------------------------------
Hotels, Restaurants and Leisure -- 1.3%
9,614 Carnival Corp. 451,858
2,575 Darden Restaurants, Inc. 52,916
1,649 Harrah's Entertainment, Inc. 89,211
5,226 Hilton Hotels Corp. 97,517
5,356 Int'l. Game Technology 206,742
3,443 Marriott Int'l., Inc. 171,737
20,021 McDonald's Corp. 520,546
6,148 Starbucks Corp.* 267,315
3,141 Starwood Hotels & Resorts
Worldwide, Inc. 140,874
1,623 Wendy's Int'l., Inc. 56,545
4,234 Yum! Brands, Inc.* 157,589
--------------
2,212,850
-------------------------------------------------------
Household Durables -- 0.5%
1,127 Black & Decker Corp. 70,021
2,084 Centex Corp. 95,343
2,219 Fortune Brands, Inc. 167,379
618 KB Home 42,413
2,782 Leggett & Platt, Inc. 74,307
1,066 Maytag Corp. 26,128
3,827 Newell Rubbermaid, Inc. 89,935
2,046 Pulte Homes, Inc. 106,453
811 Snap-On, Inc. 27,209
1,228 Stanley Works 55,972
933 Whirlpool Corp. 64,004
--------------
819,164
-------------------------------------------------------
Household Products -- 2.0%
3,390 Clorox Co. 182,314
8,248 Colgate-Palmolive Co. 482,096
7,704 Kimberly-Clark Corp. 507,539
39,416 Procter & Gamble Co. 2,145,807
--------------
3,317,756
-------------------------------------------------------
Industrial Conglomerates -- 4.3%
11,794 3M Co. 1,061,578
155,451 General Electric Co. 5,036,612
2,056 Textron, Inc. 122,024
31,210 Tyco Int'l. Ltd. 1,034,299
--------------
7,254,513
-------------------------------------------------------
Information Technology Services -- 1.2%
2,100 Affiliated Computer Svcs., Inc.* 111,174
9,179 Automatic Data Processing, Inc. 384,416
2,951 Computer Sciences Corp.* 137,015
2,482 Convergys Corp.* 38,223
7,704 Electronic Data Systems Corp. 147,532
14,105 First Data Corp. 627,955
2,689 Fiserv, Inc.* 104,575
6,010 Paychex, Inc. 203,619
1,910 Sabre Hldgs. Corp. 52,926
3,991 SunGard Data Systems, Inc.* 103,766
4,516 Unisys Corp.* 62,682
--------------
1,973,883
-------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
27
.. The Guardian S&P 500 Index Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
----------------------------------------------------------
Shares Value
----------------------------------------------------------
Insurance -- 4.5%
4,286 ACE Ltd. $ 181,212
7,659 AFLAC, Inc. 312,564
10,558 Allstate Corp. 491,475
1,504 Ambac Financial Group, Inc. 110,454
40,006 American Int'l. Group, Inc. 2,851,628
4,649 Aon Corp. 132,357
2,889 Chubb Corp. 196,972
2,424 Cincinnati Financial Corp. 105,492
4,261 Hartford Financial Svcs. Group, Inc. 292,901
2,226 Jefferson-Pilot Corp. 113,081
2,766 Lincoln Nat'l. Corp. 130,693
2,851 Loews Corp. 170,946
7,934 Marsh & McLennan Cos., Inc. 360,045
2,115 MBIA, Inc. 120,809
11,297 MetLife, Inc. 404,997
3,436 Progressive Corp. 293,091
8,227 Prudential Financial, Inc. 382,309
1,823 SAFECO Corp. 80,212
10,367 St. Paul Travelers Cos., Inc. 420,278
1,831 Torchmark Corp. 98,508
4,975 UnumProvident Corp. 79,102
2,213 XL Capital Ltd. 166,993
--------------
7,496,119
----------------------------------------------------------
Internet and Catalog Retail -- 0.5%
9,856 eBay, Inc.* 906,259
----------------------------------------------------------
Internet Software and Services -- 0.4%
20,122 Yahoo! Inc.* 731,032
----------------------------------------------------------
Leisure Equipment and Products -- 0.2%
1,223 Brunswick Corp. 49,898
4,324 Eastman Kodak Co. 116,662
2,426 Hasbro, Inc. 46,094
6,117 Mattel, Inc. 111,635
--------------
324,289
----------------------------------------------------------
Machinery -- 1.4%
5,238 Caterpillar, Inc. 416,107
841 Crane Co. 26,399
571 Cummins, Inc. 35,688
4,676 Danaher Corp. 242,451
3,730 Deere & Co. 261,622
2,911 Dover Corp. 122,553
2,354 Eaton Corp. 152,398
4,671 Illinois Tool Works, Inc. 447,902
2,653 Ingersoll-Rand Co. 181,226
1,256 ITT Inds., Inc. 104,248
1,366 Navistar Int'l. Corp.* 52,946
2,467 PACCAR, Inc. 143,061
1,735 Pall Corp. 45,440
1,682 Parker-Hannifin Corp. 100,012
--------------
2,332,053
----------------------------------------------------------
Media -- 3.5%
9,260 Clear Channel Comm., Inc. 342,157
34,494 Comcast Corp. -- Class A* 966,867
1,237 Dow Jones & Co., Inc. 55,789
4,065 Gannett Co., Inc. 344,915
5,651 Interpublic Group Cos., Inc.* 77,588
1,337 Knight-Ridder, Inc. 96,264
2,816 McGraw-Hill Cos., Inc. 215,621
690 Meredith Corp. 37,922
2,319 New York Times Co. 103,683
2,999 Omnicom Group, Inc. 227,594
69,818 Time Warner, Inc.* 1,227,400
------------------------------------------------------------
Shares Value
------------------------------------------------------------
5,202 Tribune Co. $ 236,899
4,887 Univision Comm., Inc.* 156,042
26,391 Viacom, Inc. 942,687
31,096 Walt Disney Co. 792,637
--------------
5,824,065
-----------------------------------------------------------
Metals and Mining -- 0.7%
13,096 Alcoa, Inc. 432,561
1,132 Allegheny Technologies, Inc. 20,433
3,526 Freeport-McMoran Copper & Gold, Inc. 116,887
6,419 Newmont Mining Corp. 248,800
1,128 Nucor Corp. 86,585
1,425 Phelps Dodge Corp. 110,452
1,892 United States Steel Corp. 66,447
1,195 Worthington Inds., Inc. 24,533
--------------
1,106,698
-----------------------------------------------------------
Multiline Retail -- 1.0%
1,561 Big Lots, Inc.* 22,572
1,201 Dillards, Inc. 26,782
4,737 Dollar General Corp. 92,656
2,900 Family Dollar Stores, Inc. 88,218
2,840 Federated Department Stores, Inc. 139,444
4,629 J.C. Penney Co., Inc. 174,791
5,280 Kohl's Corp.* 223,238
4,265 May Department Stores Co. 117,245
2,637 Nordstrom, Inc. 112,363
3,694 SearsRoebuck & Co. 139,486
13,845 Target Corp. 587,997
--------------
1,724,792
-----------------------------------------------------------
Multi-Utilities and Unregulated Power -- 0.7%
10,232 AES Corp.* 101,604
4,708 Calpine Corp.* 20,338
2,335 Constellation Energy Group, Inc. 88,496
4,770 Dominion Resources, Inc. 300,892
13,778 Duke Energy Corp. 279,556
4,647 Dynegy, Inc.* 19,796
3,650 Public Svc. Enterprise Group, Inc. 146,109
3,727 Sempra Energy 128,321
--------------
1,085,112
-----------------------------------------------------------
Office Electronics -- 0.1%
11,648 Xerox Corp.* 168,896
-----------------------------------------------------------
Oil and Gas -- 5.5%
1,272 Amerada Hess Corp. 100,730
4,276 Anadarko Petroleum Corp. 250,573
4,912 Apache Corp. 213,918
966 Ashland, Inc. 51,014
6,212 Burlington Resources, Inc. 224,750
16,244 ChevronTexaco Corp. 1,528,723
10,367 ConocoPhillips 790,898
3,471 Devon Energy Corp. 229,086
10,252 El Paso Corp. 80,786
1,669 EOG Resources, Inc. 99,656
100,880 Exxon Mobil Corp. 4,480,081
1,350 Kerr-McGee Corp. 72,589
2,048 Kinder Morgan, Inc. 121,426
4,449 Marathon Oil Corp. 168,350
5,890 Occidental Petroleum Corp. 285,135
1,169 Sunoco, Inc. 74,372
3,975 Unocal Corp. 151,050
1,800 Valero Energy Corp. 132,768
7,802 Williams Cos., Inc. 92,844
--------------
9,148,749
-----------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
28
.. The Guardian S&P 500 Index Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
------------------------------------------------------
Shares Value
------------------------------------------------------
Paper and Forest Products -- 0.5%
3,965 Georgia-Pacific Corp. $ 146,626
7,547 Int'l. Paper Co. 337,351
1,413 Louisiana-Pacific Corp. 33,417
2,831 MeadWestvaco Corp. 83,203
3,511 Weyerhaeuser Co. 221,614
--------------
822,211
------------------------------------------------------
Personal Products -- 0.6%
1,201 Alberto-Culver Co. 60,218
6,846 Avon Products, Inc. 315,875
15,165 Gillette Co. 642,996
--------------
1,019,089
------------------------------------------------------
Pharmaceuticals -- 7.7%
23,802 Abbott Laboratories 970,169
1,885 Allergan, Inc. 168,745
29,523 Bristol-Myers Squibb Corp. 723,313
17,027 Eli Lilly & Co. 1,190,357
5,593 Forest Laboratories, Inc.* 316,732
45,393 Johnson & Johnson 2,528,390
3,608 King Pharmaceuticals, Inc.* 41,312
33,762 Merck & Co., Inc. 1,603,695
4,100 Mylan Laboratories, Inc. 83,025
117,992 Pfizer, Inc. 4,044,766
22,681 Schering-Plough Corp. 419,145
1,463 Watson Pharmaceuticals, Inc.* 39,355
20,017 Wyeth 723,815
--------------
12,852,819
------------------------------------------------------
Real Estate -- 0.4%
1,513 Apartment Investment &
Management Co. 47,100
6,439 Equity Office Pptys. Trust 175,141
4,460 Equity Residential 132,596
2,659 Plum Creek Timber Co., Inc. 86,630
2,678 ProLogis 88,160
3,160 Simon Ppty. Group, Inc. 162,487
--------------
692,114
------------------------------------------------------
Road and Rail -- 0.4%
5,663 Burlington Northern Santa Fe 198,601
3,037 CSX Corp. 99,523
5,523 Norfolk Southern Corp. 146,470
3,900 Union Pacific Corp. 231,855
--------------
676,449
------------------------------------------------------
Semiconductors and Semiconductor Equipment -- 3.5%
6,069 Advanced Micro Devices, Inc. 96,497
5,686 Altera Corp.* 126,343
5,668 Analog Devices, Inc. 266,849
25,199 Applied Materials, Inc.* 494,404
4,283 Applied Micro Circuits Corp.* 22,786
4,595 Broadcom Corp.* 214,908
99,614 Intel Corp. 2,749,346
3,041 KLA-Tencor Corp.* 150,165
4,550 Linear Technology Corp. 179,589
5,783 LSI Logic Corp.* 44,067
4,899 Maxim Integrated Products, Inc. 256,806
8,530 Micron Technology, Inc.* 130,594
6,136 National Semiconductor Corp.* 134,931
2,577 Novellus Systems, Inc.* 81,021
2,246 NVIDIA Corp.* 46,043
3,235 PMC-Sierra, Inc.* 46,422
2,493 Teradyne, Inc.* 56,591
26,280 Texas Instruments, Inc. 635,450
5,339 Xilinx, Inc. 177,842
--------------
5,910,654
------------------------------------------------------
---------------------------------------------------------
Shares Value
---------------------------------------------------------
Software -- 4.4%
3,464 Adobe Systems, Inc. $ 161,076
1,611 Autodesk, Inc. 68,967
3,499 BMC Software, Inc.* 64,732
2,659 Citrix Systems, Inc.* 54,137
9,148 Computer Associates Int'l., Inc. 256,693
5,272 Compuware Corp.* 34,795
4,446 Electronic Arts, Inc.* 242,529
3,242 Intuit, Inc.* 125,076
1,159 Mercury Interactive Corp.* 57,753
165,976 Microsoft Corp. 4,740,275
6,727 Novell, Inc.* 56,440
80,487 Oracle Corp.* 960,210
3,803 Parametric Technology Corp.* 19,015
5,561 PeopleSoft, Inc.* 102,878
6,843 Siebel Systems, Inc.* 73,083
4,500 Symantec Corp.* 197,010
6,433 VERITAS Software Corp.* 178,194
--------------
7,392,863
---------------------------------------------------------
Specialty Retail -- 2.3%
4,489 AutoNation, Inc.* 76,762
1,333 AutoZone, Inc.* 106,773
4,634 Bed, Bath & Beyond, Inc.* 178,177
4,823 Best Buy Co., Inc. 244,719
1,654 Boise Cascade Corp. 62,257
2,929 Circuit City Stores, Inc. 37,931
34,767 Home Depot, Inc. 1,223,798
8,155 Limited Brands 152,498
12,053 Lowe's Cos., Inc. 633,385
4,230 Office Depot, Inc.* 75,759
2,665 RadioShack Corp. 76,299
2,265 Sherwin-Williams Co. 94,111
7,453 Staples, Inc. 218,447
13,490 The Gap, Inc. 327,132
2,083 Tiffany & Co. 76,759
7,969 TJX Cos., Inc. 192,372
2,834 Toys R Us, Inc.* 45,146
--------------
3,822,325
---------------------------------------------------------
Textiles, Apparel and Luxury Goods -- 0.3%
2,039 Jones Apparel Group, Inc. 80,500
1,864 Liz Claiborne, Inc. 67,067
4,106 NIKE, Inc. 311,029
649 Reebok Int'l. Ltd. 23,351
1,473 V.F. Corp. 71,735
--------------
553,682
---------------------------------------------------------
Thrifts and Mortgage Finance -- 1.8%
4,327 Countrywide Financial Corp. 303,972
10,495 Federal Home Loan Mortgage Corp. 664,333
14,854 Federal National Mortgage Assn. 1,059,981
2,276 Golden West Financial Corp. 242,053
1,532 MGIC Investment Corp. 116,218
13,818 Washington Mutual, Inc. 533,927
--------------
2,920,484
---------------------------------------------------------
Tobacco -- 1.1%
32,351 Altria Group, Inc. 1,619,167
1,345 R.J. Reynolds Tobacco Hldgs., Inc. 90,909
2,362 UST, Inc. 85,032
--------------
1,795,108
---------------------------------------------------------
Trading Companies and Distributors -- 0.1%
2,244 W.W. Grainger, Inc. 129,030
---------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
29
.. The Guardian S&P 500 Index Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
----------------------------------------------------------
Shares Value
----------------------------------------------------------
Wireless Telecommunication Services -- 0.6%
42,798 AT & T Wireless Svcs., Inc.* $ 612,867
16,542 Nextel Comm., Inc.* 441,010
-------------
1,053,877
----------------------------------------------------------
Total Common Stocks
(Cost $162,022,034) $ 162,348,930
----------------------------------------------------------
U.S. Government Securities -- 0.2%
Principal
Amount Value
----------------------------------------------------------
U.S. Treasury Bills
$ 200,000 0.98% due 9/9/2004 (1) $ 199,623
200,000 1.0625% due 8/26/2004 (1) 199,669
----------------------------------------------------------
Total U.S. Government Securities
(Cost $399,292) 399,292
----------------------------------------------------------
Repurchase Agreement -- 2.4%
$ 4,009,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $4,009,150 at
1.35%, due 7/1/2004 (2)
(Cost $4,009,000) $ 4,009,000
----------------------------------------------------------
Total Investments -- 99.8%
(Cost $166,430,326) 166,757,222
Cash, Receivables and Other Assets
Less Liabilities -- 0.2% 332,899
----------------------------------------------------------
Net Assets -- 100% $ 167,090,121
----------------------------------------------------------
* Non-income producing security.
(1)The U.S. Treasury Bill is segregated as collateral to cover margin
requirements on open futures contracts.
(2)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
Purchased Futures Contracts
Unrealized
Contracts Description Expiration Appreciation
-----------------------------------------------
14 S&P 500 Index 9/2004 $ 7,638
-----------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
30
.. The Guardian Baillie Gifford International Growth Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 94.5%
Shares Value
-----------------------------------------------------------
Australia -- 3.5%
Beverages -- 0.3%
53,400 Fosters Group Ltd. $ 175,199
Commercial Banks -- 0.3%
13,354 Australia and NZ Banking Group Ltd. 169,682
Construction and Engineering -- 0.3%
20,000 Leighton Hldgs. Ltd. 126,369
Containers and Packaging -- 0.3%
32,066 Amcor Ltd. 155,355
Food and Staples Retailing -- 0.3%
20,506 Woolworths Ltd. 162,492
Media -- 0.3%
15,700 News Corp. Ltd. 138,378
Metals and Mining -- 0.9%
53,406 BHP Billiton Ltd. 465,145
Oil and Gas -- 0.4%
15,200 Woodside Petroleum Ltd. 176,127
Real Estate -- 0.4%
19,000 Westfield Hldgs. Ltd.* 203,386
-------------
1,772,133
-----------------------------------------------------------
Denmark -- 1.0%
Commercial Banks -- 1.0%
21,990 Danske Bank AS 521,658
-----------------------------------------------------------
Finland -- 2.7%
Communications Equipment -- 2.7%
93,390 Nokia OYJ 1,349,173
-----------------------------------------------------------
France -- 11.6%
Beverages -- 1.6%
6,320 Pernod-Ricard S.A. 809,101
Health Care Equipment and Supplies -- 1.9%
14,540 Essilor Int'l. S.A. 950,204
Media -- 1.7%
30,860 Vivendi Universal S.A.* 857,064
Oil and Gas -- 2.8%
7,490 Total S.A. 1,429,663
Personal Products -- 2.1%
13,091 L'Oreal S.A. 1,046,864
Pharmaceuticals -- 1.5%
12,000 Sanofi-Synthelabo S.A. 761,556
-------------
5,854,452
-----------------------------------------------------------
Germany -- 5.3%
Automobiles -- 0.8%
9,210 Bayerische Motoren Werke AG 408,024
Commercial Banks -- 1.0%
6,217 Deutsche Bank AG 489,060
Machinery -- 0.8%
11,178 MAN AG 408,205
Software -- 1.8%
5,460 SAP AG 906,241
Textiles, Apparel and Luxury Goods -- 0.9%
3,770 Adidas-Salomon AG 450,636
-------------
2,662,166
-----------------------------------------------------------
Hong Kong -- 2.9%
Commercial Banks -- 1.0%
208,500 BOC Hong Kong Hldgs. Ltd 355,533
13,000 Hang Seng Bank Ltd. 166,673
-------------
522,206
Distributors -- 0.2%
78,000 Li & Fung Ltd. 114,004
--------------------------------------------------------------
Shares Value
--------------------------------------------------------------
Diversified Financial Services -- 0.2%
50,000 Hong Kong Exchanges & Clearing Ltd. $ 102,889
Real Estate -- 1.5%
59,000 Cheung Kong Hldgs. Ltd. 434,953
39,000 Sun Hung Kai Properties Ltd. 320,012
------------
754,965
------------
1,494,064
--------------------------------------------------------------
Ireland -- 3.2%
Airlines -- 0.7%
53,280 Ryanair Hldgs. PLC* 297,244
2,225 Ryanair Hldgs. PLC ADR* 72,935
------------
370,179
Commercial Banks -- 1.1%
34,010 Allied Irish Banks PLC 526,130
Construction Materials -- 1.4%
33,360 CRH PLC 705,438
------------
1,601,747
--------------------------------------------------------------
Italy -- 2.4%
Insurance -- 1.0%
27,170 Riunione Adriatica di Sicurta SPA 493,458
Oil and Gas -- 1.4%
35,990 ENI SPA 715,459
------------
1,208,917
--------------------------------------------------------------
Japan -- 23.1%
Auto Components -- 1.2%
33,000 Bridgestone Corp. 618,684
Automobiles -- 1.7%
21,900 Toyota Motor Corp. 885,253
Building Products -- 2.1%
102,000 Asahi Glass Co. 1,058,759
Commercial Banks -- 0.9%
104 UFJ Hldgs., Inc.* 458,439
Diversified Financial Services -- 1.0%
7,800 Promise Co. 519,310
Diversified Telecommunication Services -- 0.7%
67 Nippon Tele. & Tel. Corp. 357,227
Electronic Equipment and Instruments -- 2.9%
26,000 Alps Electric Co. Ltd. 369,034
2,400 Keyence Corp. 546,308
6,600 Kyocera Corp. 558,928
------------
1,474,270
Household Products -- 1.0%
22,000 Kao Corp. 529,151
Insurance -- 1.0%
52,000 Mitsui Sumitomo Insurance Co. 487,448
Leisure Equipment and Products -- 1.3%
49,500 Konica Corp. 681,760
Machinery -- 1.1%
20,000 Daikin Inds. Ltd. 535,918
Multiline Retail -- 0.4%
16,000 Takashimaya Co. Ltd. 184,663
Office Electronics -- 1.9%
29,000 Brother Inds. Ltd. 280,333
13,000 Canon, Inc. 683,616
------------
963,949
Road and Rail -- 1.2%
120,000 Tokyu Corp. 613,471
Semiconductors and Semiconductor Equipment -- 0.9%
3,900 Rohm Co. Ltd. 465,810
- --------------------------------------------------------------------------------
See notes to financial statements.
31
.. The Guardian Baillie Gifford International Growth Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
-------------------------------------------------------------
Shares Value
-------------------------------------------------------------
Specialty Retail -- 0.9%
11,900 Yamada Denki Co., Ltd. $ 442,937
Tobacco -- 1.2%
76 Japan Tobacco, Inc. 589,401
Trading Companies and Distributors -- 1.2%
82,000 Mitsui & Co. Ltd. 612,685
Wireless Telecommunication Services -- 0.5%
128 NTT DoCoMo, Inc. 228,268
------------
11,707,403
----------------------------------------------------------
Netherlands -- 1.9%
Household Durables -- 0.7%
13,650 Philips Electronics (KON) 367,957
Insurance -- 1.2%
47,865 Aegon NV 577,796
------------
945,753
----------------------------------------------------------
New Zealand -- 0.4%
Diversified Telecommunication Services -- 0.4%
53,400 Telecom. Corp. of New Zealand 198,600
----------------------------------------------------------
People's Republic of China -- 0.7%
Oil and Gas -- 0.7%
807,500 CNOOC Ltd. 341,648
----------------------------------------------------------
Russia -- 0.6%
Oil and Gas -- 0.6%
2,840 LUKOIL ADR 296,780
----------------------------------------------------------
Singapore -- 0.4%
Electronic Equipment and Instruments -- 0.4%
19,000 Venture Corp. Ltd. 198,687
----------------------------------------------------------
South Africa -- 0.4%
Metals and Mining -- 0.4%
5,200 Anglo American Platinum Corp. 196,422
----------------------------------------------------------
South Korea -- 0.7%
Semiconductors and Semiconductor Equipment -- 0.7%
1,800 Samsung Electronics Co. Ltd. GDR 370,350
----------------------------------------------------------
Spain -- 1.9%
Commercial Banks -- 1.1%
9,830 Banco Popular Espanol S.A. 555,829
Tobacco -- 0.8%
13,140 Altadis S.A. 406,548
------------
962,377
----------------------------------------------------------
Sweden -- 4.2%
Communications Equipment -- 1.8%
302,580 LM Ericsson* 892,543
Machinery -- 2.4%
24,860 Atlas Copco AB 850,578
10,600 SKF AB 389,436
------------
1,240,014
------------
2,132,557
----------------------------------------------------------
Switzerland -- 4.2%
Commercial Banks -- 2.0%
14,100 UBS AG 993,949
Commercial Services and Supplies -- 0.8%
8,410 Adecco S.A. 419,190
Electrical Equipment -- 1.4%
134,300 ABB Ltd.* 734,847
------------
2,147,986
----------------------------------------------------------
United Kingdom -- 23.4%
Commercial Banks -- 5.1%
69,800 Barclays PLC 594,424
----------------------------------------------------------
Shares Value
----------------------------------------------------------
55,000 HSBC Hldgs. $ 817,619
27,764 Royal Bank of Scotland 799,294
23,000 Standard Chartered PLC 374,437
------------
2,585,774
Hotels, Restaurants and Leisure -- 2.5%
11,000 Carnival PLC 534,044
28,678 Compass Group 174,948
112,000 Hilton Group PLC 560,404
------------
1,269,396
Metals and Mining -- 0.7%
40,000 BHP Billiton PLC 346,989
Multiline Retail -- 0.7%
13,000 Next PLC 335,369
Oil and Gas -- 3.4%
58,000 BG Group PLC 357,241
155,000 BP PLC 1,368,469
------------
1,725,710
Pharmaceuticals -- 2.9%
10,000 Astrazeneca 448,512
51,002 GlaxoSmithKline PLC 1,031,871
------------
1,480,383
Software -- 0.3%
41,000 Sage Group 138,624
Tobacco -- 3.6%
33,000 British American Tobacco PLC 511,211
61,000 Imperial Tobacco 1,313,773
------------
1,824,984
Wireless Telecommunication Services -- 4.2%
265,000 mmO2* 445,588
778,650 Vodafone Group 1,704,526
------------
2,150,114
------------
11,857,343
----------------------------------------------------------
Total Common Stocks
(Cost $37,251,718) 47,820,216
----------------------------------------------------------
Preferred Stocks -- 3.1%
Brazil -- 1.2%
Metals and Mining -- 0.4%
4,800 Comp. Vale Do Rio Doce ADR $ 187,680
Oil and Gas -- 0.8%
16,500 Petroleo Brasileiro S.A. ADR 415,800
------------
603,480
----------------------------------------------------------
Germany -- 1.9%
Automobiles -- 1.9%
1,440 Porsche AG 964,823
----------------------------------------------------------
Total Preferred Stocks
(Cost $1,056,862) 1,568,303
----------------------------------------------------------
Convertible Bond -- 0.5%
Principal
Amount Value
----------------------------------------------------------
Japan -- 0.5%
Commercial Banks -- 0.5%
(Yen) 12,000,000 SMFG Finance
2.25% due 7/11/2005
(Cost $88,073) $ 263,964
----------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
32
.. The Guardian Baillie Gifford International Growth Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
Repurchase Agreement -- 2.8%
Principal
Amount Value
------------------------------------------------------------
$ 1,405,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $1,405,014 at
0.35%, due 7/1/2004 (1)
(Cost $1,405,000) $ 1,405,000
-----------------------------------------------------------
Total Investments -- 100.9%
(Cost $39,801,653) 51,057,483
Liabilities in Excess of Cash, Receivables and
Other Assets -- (0.9)% (447,443)
-----------------------------------------------------------
Net Assets -- 100% $ 50,610,040
-----------------------------------------------------------
* Non-income producing security.
(1)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
Glossary of Terms:
ADR -- American Depositary Receipt.
GDR -- Global Depositary Receipt.
- --------------------------------------------------------------------------------
See notes to financial statements.
33
.. The Guardian Baillie Gifford Emerging Markets Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Common Stocks -- 92.9%
Shares Value
------------------------------------------------------------------
Argentina -- 0.1%
Distributors -- 0.1%
11,480 Imp. Y Exp. Patagonia* $ 48,851
---------------------------------------------------------------
Brazil -- 5.5%
Diversified Telecommunication Services -- 2.1%
132,600 Telecom. Norte Leste Participacoes ADR 1,687,998
Metals and Mining -- 1.5%
49,600 Comp. Siderurgica Nacional S.A. ADR 603,136
12,300 Comp. Vale Do Rio Doce ADR 584,865
------------
1,188,001
Oil and Gas -- 1.2%
33,000 Petroleo Brasileiro S.A. ADR 926,310
Paper and Forest Products -- 0.7%
17,800 Votorantim Celulose e Papel S.A. ADR 566,040
------------
4,368,349
---------------------------------------------------------------
Chile -- 1.4%
Electric Utilities -- 0.8%
102,725 Enersis S.A. ADR* 612,241
Food and Staples Retailing -- 0.6%
26,700 Cencosud S.A. ADR* 492,721
------------
1,104,962
---------------------------------------------------------------
Hong Kong -- 1.5%
Household Durables -- 0.5%
1,428,000 TCL Int'l. Hldgs. Ltd. 443,978
Internet Software and Services -- 0.5%
1,600,000 Tom.Com Ltd.* 365,142
Oil and Gas -- 0.5%
850,000 Panva Gas Hldgs. Ltd.* 367,803
------------
1,176,923
---------------------------------------------------------------
India -- 4.0%
Chemicals -- 0.9%
36,500 Reliance Inds. Ltd. GDR 728,175
Commercial Banks -- 0.9%
27,500 HDFC Bank Ltd. ADR 738,650
Metals and Mining -- 2.2%
40,000 Hindalco Inds. Ltd. GDR+ 874,000
170,000 Vedanta Resources PLC* 886,826
------------
1,760,826
------------
3,227,651
---------------------------------------------------------------
Indonesia -- 3.2%
Diversified Telecommunication Services -- 2.0%
1,840,000 PT Indonesian Satellite Corp. Tbk
(Indosat)* 787,956
985,000 Telekomunikasi Indonesia 775,508
------------
1,563,464
Metals and Mining -- 1.2%
15,859,000 PT Bumi Resources Tbk 970,202
------------
2,533,666
---------------------------------------------------------------
Israel -- 3.8%
Chemicals -- 1.0%
176,100 Makhteshim-Agan Inds. Ltd. 819,452
Commercial Banks -- 1.1%
315,000 Bank Hapoalim Ltd. 837,900
Information Technology Services -- 0.1%
3,100 Radware Ltd.* 52,855
Internet Software and Services -- 1.0%
30,400 Check Point Software Technologies Ltd.* 820,496
--------------------------------------------------------------
Shares Value
--------------------------------------------------------------
Pharmaceuticals -- 0.6%
11,300 Taro Pharmaceutical Inds. Ltd. $ 491,550
------------
3,022,253
--------------------------------------------------------------
Malaysia -- 5.9%
Automobiles -- 0.6%
215,000 Proton Hldgs. Berhad* 452,631
Diversified Telecommunication Services -- 0.3%
78,000 Telekom Malaysia Berhad 214,077
Food Products -- 1.7%
420,000 IOI Corp. Berhad 900,790
188,000 IOI Oleochemical Inds. Berhad 460,105
------------
1,360,895
Hotels, Restaurants and Leisure -- 0.8%
201,800 Tanjong PLC 663,816
Media -- 1.1%
700,000 Astro All Asia Networks PLC* 843,684
Tobacco -- 0.8%
50,000 British American Tobacco Malaysia
Berhad 664,474
Transportation Infrastructure -- 0.6%
800,000 PLUS Expressways Berhad 473,684
------------
4,673,261
--------------------------------------------------------------
Mexico -- 10.6%
Commercial Banks -- 0.4%
98,200 Grupo Fin. Banorte S.A. de C.V. 349,057
Construction and Engineering -- 0.6%
150,000 Consorcio Ara S.A. de C.V.* 431,098
Construction Materials -- 1.8%
48,700 Cemex S.A. de C.V. ADR 1,417,170
Diversified Telecommunication Services -- 2.0%
271,000 Grupo Carso Global Telecom.* 394,712
34,600 Telefonos de Mexico S.A. ADR 1,151,142
------------
1,545,854
Media -- 0.8%
76,000 TV Azteca S.A. de C.V. ADR 656,640
Multiline Retail -- 1.4%
365,475 Wal-Mart de Mexico S.A. de C.V. 1,083,640
Transportation Infrastructure -- 0.3%
14,400 Grupo Aeroportuario del Sureste
S.A. de C.V. ADR 266,400
Wireless Telecommunication Services -- 3.3%
62,900 America Movil S.A. de C.V. ADR 2,287,673
191,000 America Telecom S.A. de C.V.* 367,610
------------
2,655,283
------------
8,405,142
--------------------------------------------------------------
People's Republic of China -- 7.2%
Automobiles -- 0.8%
1,880,000 Denway Motors Ltd. 680,924
Diversified Telecommunication Services -- 1.1%
2,440,000 China Telecom Corp. Ltd. 852,469
Oil and Gas -- 2.9%
3,540,000 CNOOC Ltd. 1,497,750
1,760,000 PetroChina Co. Ltd. 812,339
------------
2,310,089
Transportation Infrastructure -- 1.4%
1,536,000 Zhejiang Expressway Co. Ltd. 1,092,965
Wireless Telecommunication Services -- 1.0%
1,050,000 China Unicom Ltd. 827,916
------------
5,764,363
--------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
34
.. The Guardian Baillie Gifford Emerging Markets Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
----------------------------------------------------------------
Shares Value
----------------------------------------------------------------
Poland -- 1.0%
Commercial Banks -- 1.0%
25,000 Bank Pekao S.A. $ 833,941
----------------------------------------------------------------
Russia -- 6.5%
Metals and Mining -- 0.6%
64,000 Peter Hambro Mining PLC* 482,667
Oil and Gas -- 4.1%
19,700 LUKOIL ADR 2,058,650
40,952 OAO Gazprom ADR 1,175,322
------------
3,233,972
Wireless Telecommunication Services -- 1.8%
7,900 Mobile Telesystems ADR 963,800
5,100 VimpelCom ADR 491,895
------------
1,455,695
------------
5,172,334
----------------------------------------------------------------
South Africa -- 6.6%
Metals and Mining -- 2.0%
42,435 Anglo American Platinum Corp. 1,602,916
Oil and Gas -- 2.8%
145,100 Sasol Ltd. 2,241,350
Paper and Forest Products -- 1.8%
91,000 Sappi Ltd. 1,385,193
------------
5,229,459
----------------------------------------------------------------
South Korea -- 16.6%
Chemicals -- 1.2%
86,000 Cheil Inds., Inc. 997,317
Commercial Services and Supplies -- 1.2%
39,500 S1 Corp. 922,977
Industrial Conglomerates -- 2.2%
131,000 Hanwha Corp. 872,956
114,040 Samsung Techwin Co. Ltd.* 889,226
------------
1,762,182
Insurance -- 1.6%
35,620 Oriental Fire & Marine Insurance Co. Ltd. 487,058
12,500 Samsung Fire & Marine Ins. Co. Ltd. 799,438
------------
1,286,496
Marine -- 1.1%
195,000 Samsung Heavy Inds. Co. Ltd. 874,167
Media -- 0.9%
5,300 Cheil Comms., Inc. 720,121
Metals and Mining -- 1.1%
117,200 Dongkuk Steel Mill Co. Ltd. 903,723
Pharmaceuticals -- 1.1%
14,100 Yuhan Corp. 866,378
Semiconductors and Semiconductor Equipment -- 3.6%
12,150 Samsung Electronics Co. Ltd. GDR+ 2,499,862
800 Samsung Electronics Co. Ltd. 330,247
------------
2,830,109
Trading Companies and Distributors -- 2.6%
170,200 Samsung Corp. 2,076,867
------------
13,240,337
----------------------------------------------------------------
Sweden -- 0.7%
Personal Products -- 0.7%
16,640 Oriflame Cosmetics S.A.* 594,760
----------------------------------------------------------------
Taiwan -- 14.6%
Building Products -- 2.0%
1,550,000 Asia Cement Corp. 866,746
1,520,000 Taiwan Cement Corp. 687,210
------------
1,553,956
--------------------------------------------------------------
Shares Value
--------------------------------------------------------------
Construction and Engineering -- 0.4%
667,000 CTCI Corp. $ 329,334
Distributors -- 0.3%
355,000 National Petroleum Co. Ltd. 237,582
Diversified Financial Services -- 1.3%
2,047,000 SinoPac Hldgs. 1,071,600
Electronic Equipment and Instruments -- 3.3%
484,000 Hon Hai Precision Inds. Co. Ltd. 1,799,524
500,000 Synnex Technology Int'l. Corp. 810,529
------------
2,610,053
Health Care Equipment and Supplies -- 0.0%
800 Pihsiang Machinery Mfg. Co., Ltd. 1,678
Machinery -- 0.7%
1,071,000 Yungtay Engineering Co., Ltd. 570,223
Multiline Retail -- 1.2%
2,200,000 Far Eastern Dept. Stores Ltd. 945,568
Paper and Forest Products -- 0.7%
1,200,000 Chung Hwa Pulp Corp. 571,089
Semiconductors and Semiconductor Equipment -- 2.9%
1,070,000 Nanya Technology Corp. 827,483
1,935,000 United Microelectronics Corp. 1,438,876
------------
2,266,359
Wireless Telecommunication Services -- 1.8%
1,491,800 Taiwan Cellular Corp. 1,419,917
------------
11,577,359
--------------------------------------------------------------
Thailand -- 0.2%
Wireless Telecommunication Services -- 0.2%
71,000 Advanced Info Service Public Co. Ltd. 154,537
--------------------------------------------------------------
Turkey -- 2.6%
Commercial Banks -- 2.1%
560,000,000 Turkiye Garanti Bankasi AS* 1,669,249
Industrial Conglomerates -- 0.5%
81,540,377 Koc Hldg. A.S. 368,016
------------
2,037,265
--------------------------------------------------------------
Venezuela -- 0.9%
Diversified Telecommunication Services -- 0.9%
35,000 Comp. Anonima Nacional Tel. de
Venezuela ADR 705,250
--------------------------------------------------------------
Total Common Stocks
(Cost $65,057,765) 73,870,663
--------------------------------------------------------------
Preferred Stocks -- 5.1%
Brazil -- 5.1%
Commercial Banks -- 2.0%
1,351,577 Itausa-Investimentos Itau S.A. $ 1,568,561
Diversified Telecommunication Services -- 0.4%
1,719,000 Celular CRT Participacoes S.A.* 299,246
Food Products -- 0.0%
4,700,000 Comp. Lorenz S.A.* 0
Metals and Mining -- 0.6%
13,000 Comp. Vale Do Rio Doce 505,206
Oil and Gas -- 1.9%
59,600 Petroleo Brasileiro S.A. ADR 1,501,920
Road and Rail -- 0.2%
12,300 All America Latina Logistica* 206,190
--------------------------------------------------------------
Total Preferred Stocks
(Cost $2,874,173) 4,081,123
--------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
35
.. The Guardian Baillie Gifford Emerging Markets Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
Repurchase Agreement -- 1.5%
Principal
Amount Value
--------------------------------------------------------
$ 1,179,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $1,179,011 at
0.35%, due 7/1/2004 (1)
(Cost $1,179,000) $ 1,179,000
--------------------------------------------------------
Total Investments -- 99.5%
(Cost $69,110,938) 79,130,786
Cash, Receivables and Other Assets
Less Liabilities -- 0.5% 389,523
--------------------------------------------------------
Net Assets -- 100% $ 79,520,309
--------------------------------------------------------
* Non-income producing security.
+ Rule 144A restricted security.
(1)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
Glossary of Terms:
ADR -- American Depositary Receipt.
GDR -- Global Depositary Receipt.
- --------------------------------------------------------------------------------
See notes to financial statements.
36
.. The Guardian Investment Quality Bond Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Asset Backed Securities -- 4.8%
Principal
Amount Value
-------------------------------------------------------------
$ 1,280,000 Aesop Funding II LLC
2003-2A A3
3.61% due 6/20/2009+ $ 1,260,802
1,200,000 Ameriquest Mtg. Secs. Inc.
2003-5 A6
4.541% due 7/25/2033 1,176,732
105,627 Amresco
1997-1 MIF
7.42% due 3/25/2027 105,461
1,700,000 CNH Equipment Tr.
2003-A A4B
2.57% due 9/15/2009 1,657,995
1,600,000 Residential Funding Mortgage Secs.
2003-HS3 AI2
3.15% due 7/25/2018 1,564,880
1,900,000 Vanderbilt Acquisition Loan Tr.
2002-1 A3
5.70% due 9/7/2023 1,921,911
-------------------------------------------------------------
Total Asset Backed Securities
(Cost $7,822,845) 7,687,781
-------------------------------------------------------------
Collateralized Mortgage Obligations -- 6.9%
FHLMC
H006 A2
$ 1,995,713 2.837% due 2/15/2010 $ 1,959,944
2693 QE
3,000,000 5.50% due 9/15/2028 (1) 3,037,230
2430 GD
710,307 6.50% due 11/15/2030 721,612
2744 VC
1,206,357 5.50% due 4/15/2011 1,252,425
2744 PC
1,500,000 5.50% due 1/15/2031 1,571,687
FNMA
2003-74 ZK
745,157 3.50% due 8/25/2033 736,229
2001-51 PH
1,310,000 6.00% due 8/25/2030 1,359,349
385,718 GNMA
2003-75 WF
2.61% due 5/20/2033 (2) 386,045
-------------------------------------------------------------
Total Collateralized Mortgage
Obligations
(Cost $11,181,073) 11,024,521
-------------------------------------------------------------
Commercial Mortgage Backed Securities -- 4.0%
$ 856,442 First Union National Bank Comm'l.
Mtg. Tr.
2000-C2 A1
6.94% due 10/15/2032 $ 913,607
997,366 GMAC Comm'l. Mtg. Sec., Inc.
1997-C1 A3
6.869% due 7/15/2029 1,068,480
1,700,000 Greenwich Capital Comm'l. Funding
Corp.
2004-GG1 A7
5.317% due 6/10/2036 (2) 1,697,345
1,165,000 Midland Realty Acceptance Corp.
1996-C1 C
7.927% due 8/25/2028 (1) 1,259,327
-----------------------------------------------------------
Principal
Amount Value
-----------------------------------------------------------
$ 1,377,252 Mortgage Capital Funding, Inc.
1997-MC1 A3
7.288% due 7/20/2027 $ 1,420,878
-----------------------------------------------------------
Total Commercial Mortgage Backed
Securities
(Cost $6,494,980) 6,359,637
-----------------------------------------------------------
Corporate Bonds -- 25.1%
Aerospace and Defense -- 0.5%
$ 300,000 Lockheed Martin Corp.
8.50% due 12/1/2029 $ 376,308
100,000 Northrop Grumman Corp.
7.125% due 2/15/2011 112,377
250,000 TRW, Inc.
7.75% due 6/1/2029 291,351
-------------
780,036
-----------------------------------------------------------
Automotive -- 1.6%
500,000 DaimlerChrysler NA Hldg.
4.05% due 6/4/2008 490,263
Ford Motor Credit Co.
500,000 6.50% due 1/25/2007 525,364
500,000 7.00% due 10/1/2013 504,733
400,000 7.375% due 10/28/2009 426,890
295,000 General Motors Corp.
8.375% due 7/15/2033 312,255
250,000 Lear Corp.
8.11% due 5/15/2009 284,762
-------------
2,544,267
-----------------------------------------------------------
Chemicals -- 0.2%
400,000 Potash Corp.
4.875% due 3/1/2013 383,287
-----------------------------------------------------------
Energy -- 1.3%
350,000 Canadian Oil Sands Ltd.
5.80% due 8/15/2013+ 349,559
500,000 Pioneer Natural Resources Co.
7.20% due 1/15/2028 532,465
269,000 Pride Int'l., Inc.
9.375% due 5/1/2007 274,380
600,000 RAS Laffan Liquefied Natural Gas
3.437% due 9/15/2009+ 586,200
350,000 Western Oil Sands, Inc.
8.375% due 5/1/2012 379,750
-------------
2,122,354
-----------------------------------------------------------
Energy-Refining -- 0.4%
500,000 Tosco Corp.
8.125% due 2/15/2030 616,689
-----------------------------------------------------------
Entertainment -- 0.6%
900,000 Time Warner, Inc.
7.57% due 2/1/2024 971,856
-----------------------------------------------------------
Environmental -- 0.6%
800,000 Waste Management, Inc.
7.375% due 8/1/2010 898,825
-----------------------------------------------------------
Finance Companies -- 1.9%
500,000 Capital One Bank
5.75% due 9/15/2010 513,842
500,000 CIT Group, Inc.
1.48% due 5/18/2007 (2) 499,406
200,000 General Electric Capital Corp.
6.75% due 3/15/2032 215,003
- --------------------------------------------------------------------------------
See notes to financial statements.
37
.. The Guardian Investment Quality Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
-------------------------------------------------------------
Principal
Amount Value
-------------------------------------------------------------
General Motors Acceptance Corp.
$ 500,000 6.125% due 9/15/2006 $ 520,680
395,000 6.875% due 9/15/2011 404,992
400,000 Household Finance Corp.
6.375% due 11/27/2012 424,112
375,000 MBNA America Bank Nat'l.
7.125% due 11/15/2012 413,511
-------------
2,991,546
----------------------------------------------------------
Financial -- 0.8%
400,000 Goldman Sachs Group, Inc.
5.70% due 9/1/2012 405,754
400,000 Lehman Brothers Hldgs., Inc.
6.625% due 1/18/2012 434,336
400,000 Morgan Stanley
6.60% due 4/1/2012 430,626
-------------
1,270,716
----------------------------------------------------------
Financial-Banks -- 2.0%
425,000 Bank America Corp.
4.875% due 9/15/2012 414,103
750,000 Citigroup, Inc.
5.625% due 8/27/2012 770,932
300,000 City Nat'l. Corp.
5.125% due 2/15/2013 291,290
450,000 J.P. Morgan Chase & Co.
5.75% due 1/2/2013 457,362
200,000 Regions Financial Corp.
6.375% due 5/15/2012 213,992
250,000 Sovereign Bank
5.125% due 3/15/2013 237,651
300,000 Wells Fargo Bank NA
6.45% due 2/1/2011 327,089
500,000 Zions Bancorp
6.00% due 9/15/2015 504,125
-------------
3,216,544
----------------------------------------------------------
Food and Beverage -- 0.5%
850,000 Kellogg Co.
2.875% due 6/1/2008 813,648
----------------------------------------------------------
Gaming -- 0.4%
500,000 Int'l. Game Technology
8.375% due 5/15/2009 588,219
----------------------------------------------------------
Home Construction -- 0.8%
500,000 D.R. Horton, Inc.
5.875% due 7/1/2013 475,000
500,000 Lennar Corp.
9.95% due 5/1/2010 556,145
300,000 Ryland Group, Inc.
5.375% due 6/1/2008 302,250
-------------
1,333,395
----------------------------------------------------------
Industrial-Other -- 1.3%
2,000,000 Aramark Svcs., Inc.
7.10% due 12/1/2006 2,150,814
----------------------------------------------------------
Media-Cable -- 1.0%
400,000 AT & T Broadband Corp.
9.455% due 11/15/2022 514,152
1,000,000 Comcast Cable Comm., Inc.
6.875% due 6/15/2009 1,091,250
-------------
1,605,402
----------------------------------------------------------
-------------------------------------------------------
Principal
Amount Value
-------------------------------------------------------
Media-NonCable -- 0.8%
$ 150,000 News America Hldgs.
8.00% due 10/17/2016 $ 177,299
1,150,000 Scholastic Corp.
5.75% due 1/15/2007 1,203,052
-------------
1,380,351
-------------------------------------------------------
Merchandising-Supermarkets -- 1.1%
500,000 Delhaize America, Inc.
7.375% due 4/15/2006 526,888
650,000 Kroger Co.
7.25% due 6/1/2009 722,090
500,000 Safeway, Inc.
6.15% due 3/1/2006 522,791
-------------
1,771,769
-------------------------------------------------------
Metals and Mining -- 0.3%
500,000 Glencore Funding LLC
6.00% due 4/15/2014+ 463,770
-------------------------------------------------------
Natural Gas-Pipelines -- 1.8%
1,700,000 Consolidated Natural Gas Co.
7.25% due 10/1/2004 1,721,109
250,000 Duke Energy Field Svcs.
8.125% due 8/16/2030 293,143
500,000 Plains All American Pipeline
5.625% due 12/15/2013+ 474,631
400,000 Teppco Partners LP
6.125% due 2/1/2013 406,771
-------------
2,895,654
-------------------------------------------------------
Paper and Forest Products -- 0.2%
250,000 Packaging Corp. of America
5.75% due 8/1/2013 247,901
150,000 Weyerhaeuser Co.
6.00% due 8/1/2006 157,817
-------------
405,718
-------------------------------------------------------
Railroads -- 0.4%
200,000 CSX Corp.
4.875% due 11/1/2009 201,049
450,000 Norfolk Southern Corp.
6.75% due 2/15/2011 492,215
-------------
693,264
-------------------------------------------------------
Real Estate Investment Trust -- 0.8%
100,000 EOP Operating LP
7.00% due 7/15/2011 108,991
500,000 Istar Financial, Inc.
6.00% due 12/15/2010 496,874
200,000 Liberty Ppty. LP
7.25% due 3/15/2011 223,878
200,000 Prologis
5.50% due 3/1/2013 198,220
100,000 Regency Centers LP
6.75% due 1/15/2012 108,676
125,000 Simon Ppty. Group LP
4.90% due 1/30/2014 116,676
-------------
1,253,315
-------------------------------------------------------
Retailers -- 0.2%
300,000 Staples, Inc.
7.375% due 10/1/2012 337,877
-------------------------------------------------------
Services -- 0.3%
500,000 PHH Corp.
7.125% due 3/1/2013 546,051
-------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
38
.. The Guardian Investment Quality Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
-------------------------------------------------------------
Principal
Amount Value
-------------------------------------------------------------
Technology -- 0.8%
$ 200,000 IBM Corp.
5.875% due 11/29/2032 $ 194,737
1,000,000 Jabil Circuit, Inc.
5.875% due 7/15/2010 1,032,996
-------------
1,227,733
-------------------------------------------------------------
Utilities-Electric and Water -- 1.3%
350,000 American Electric Power, Inc.
5.25% due 6/1/2015 335,758
250,000 FirstEnergy Corp.
6.45% due 11/15/2011 259,190
400,000 Oncor Electric Delivery Co.
7.25% due 1/15/2033 443,514
300,000 Progress Energy, Inc.
7.00% due 10/30/2031 308,726
200,000 Public Service Electric Gas Co.
5.125% due 9/1/2012 199,696
500,000 Xcel Energy, Inc.
3.40% due 7/1/2008 482,625
-------------
2,029,509
-------------------------------------------------------------
Wireless Communications -- 1.1%
250,000 AT & T Wireless Svcs., Inc.
8.125% due 5/1/2012 289,038
650,000 Tritel PCS, Inc.
10.375% due 1/15/2011 750,843
690,000 Verizon Wireless Capital LLC
5.375% due 12/15/2006 719,352
-------------
1,759,233
-------------------------------------------------------------
Wireline Communications -- 1.6%
250,000 Deutsche Telekom Int'l. Finance BV
8.75% due 6/15/2030 (2) 304,284
France Telecom S.A.
325,000 8.75% due 3/1/2011 (2) 376,617
150,000 9.50% due 3/1/2031 (2) 188,253
600,000 Sprint Capital Corp.
8.375% due 3/15/2012 689,597
200,000 Telecom Italia Capital
5.25% due 11/15/2013+ 193,569
300,000 Telus Corp.
8.00% due 6/1/2011 340,969
400,000 Verizon Global Funding Corp.
7.75% due 12/1/2030 449,272
-------------
2,542,561
-------------------------------------------------------------
Yankee -- 0.5%
700,000 Pemex Master Tr.
7.875% due 2/1/2009 (2) 761,250
-------------------------------------------------------------
Total Corporate Bonds
(Cost $39,480,700) 40,355,653
-------------------------------------------------------------
Mortgage Pass-Through Securities -- 37.2%
FHLMC
$ 1,400,000 5.50%, (30 yr. TBA) $ 1,393,437
11,223,053 5.50%, 2033 11,208,482
1,171,691 6.50%, 8/1/2032 1,222,102
19,794 7.00%, 8/1/2008 20,995
FNMA
290,000 5.50%, (15 yr. TBA) 296,525
5,500,000 5.00%, (30 yr. TBA) 5,310,937
3,700,000 5.50%, (30 yr. TBA) 3,681,500
2,800,000 6.00%, (30 yr. TBA) 2,857,750
2,950,000 6.50%, (30 yr. TBA) 3,070,767
--------------------------------------------------------------
Principal
Amount Value
--------------------------------------------------------------
$ 6,407,164 5.00%, 2018 $ 6,431,823
6,953,688 5.00%, 2034 6,725,169
566,405 5.50%, 12/1/2014 583,035
2,786,301 5.50%, 6/1/2033 2,781,020
1,198,329 5.50%, 5/1/2034 1,194,149
782,408 6.00%, 10/1/2013 817,690
555,596 6.00%, 4/1/2016 579,744
2,711,786 6.00%, 2/1/2034 2,779,384
286,097 6.50%, 8/1/2016 302,420
980,705 6.50%, 11/1/2017 1,036,655
2,248,813 6.50%, 2032 2,343,236
9,094 7.00%, 2/1/2009 9,638
64,021 7.00%, 2012 68,015
210,052 7.00%, 9/1/2014 223,175
3,619 7.00%, 8/1/2023 3,851
2,162 7.00%, 12/1/2027 2,291
52,334 7.00%, 12/1/2028 55,436
782,760 7.00%, 2032 826,717
241 7.50%, 5/1/2027 258
160,217 7.50%, 12/1/2029 171,805
636,746 7.50%, 2/1/2031 683,167
277,375 8.00%, 2030 301,591
GNMA
1,307,293 6.00%, 2033 1,341,918
1,249,909 6.50%, 2032 1,307,536
187,183 8.00%, 2030 205,205
-----------------------------------------------------------
Total Mortgage Pass-Through
Securities
(Cost $60,494,281) 59,837,423
-----------------------------------------------------------
Sovereign Debt Securities -- 0.7%
$ 200,000 Pemex Project Funding Master Tr.
2.82% due 6/15/2010+(2) $ 200,900
475,000 Republic of South Africa
6.50% due 6/2/2014 479,750
500,000 United Mexican States
8.00% due 9/24/2022 519,250
-----------------------------------------------------------
Total Sovereign Debt
Securities
(Cost $1,182,895) 1,199,900
-----------------------------------------------------------
U.S. Government Securities -- 16.5%
U.S. Government Agency Securities -- 2.9%
FHLMC
$ 335,000 4.50%, 1/15/2014 $ 318,372
FNMA
345,000 1.02%, 7/20/2004++ 344,771
3,600,000 3.25%, 1/15/2008 3,537,950
450,000 4.625%, 10/15/2013 433,313
-------------
4,634,406
-----------------------------------------------------------
U.S. Treasury Bonds and Notes -- 13.6%
U.S. Treasury Bonds
2,670,000 5.375%, 2/15/2031 2,692,842
5,735,000 6.00%, 2/15/2026 6,179,686
U.S. Treasury Notes
769,000 4.00%, 6/15/2009 775,579
8,340,000 4.375%, 5/15/2007 8,620,174
3,677,000 4.75%, 5/15/2014 3,715,351
-------------
21,983,632
-----------------------------------------------------------
Total U.S. Government
Securities
(Cost $26,528,968) 26,618,038
-----------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
39
.. The Guardian Investment Quality Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
Commercial Paper -- 10.1%
Principal
Amount Value
-----------------------------------------------------------------
Automotive -- 1.9%
$ 3,000,000 Toyota Motor Credit Co.
1.04% due 7/15/2004 (1) $ 2,998,787
-----------------------------------------------------------------
Beverage -- 1.8%
2,900,000 Coca-Cola Enterprises, Inc.
1.12% due 7/15/2004 (1) 2,898,737
-----------------------------------------------------------------
Diversified Financial Services -- 3.1%
5,000,000 Citigroup Global Markets Hldgs., Inc.
1.10% due 7/15/2004 (1) 4,997,861
-----------------------------------------------------------------
Household Products -- 2.1%
3,300,000 Procter & Gamble Co.
1.02% due 7/15/2004 (1) 3,298,691
-----------------------------------------------------------------
Media -- 1.2%
2,000,000 Tribune Co.
1.10% due 7/15/2004 (1) 1,999,144
-----------------------------------------------------------------
Total Commercial Paper
(Cost $16,193,220) 16,193,220
-----------------------------------------------------------------
Repurchase Agreement -- 3.3%
$ 5,368,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $5,368,201 at
1.35%, due 7/1/2004 (1)(3)
(Cost $5,368,000) $ 5,368,000
-----------------------------------------------------------------
Total Investments -- 108.6%
(Cost $174,746,962) 174,644,173
Payables for Mortgage Pass-Throughs
Delayed Delivery Securities (1) -- (12.4)% (19,974,305)
Cash, Receivables and Other Assets
Less Liabilities -- 3.8% 6,209,933
-----------------------------------------------------------------
Net Assets -- 100% $ 160,879,801
-----------------------------------------------------------------
+ Rule 144A restricted security.
++Discount note. The rate shown is the effective yield at date of purchase.
(1)Securities are segregated to cover forward mortgage purchases.
(2)Floating rate note. The rate shown is the rate in effect at June 30, 2004.
(3)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
40
.. The Guardian Low Duration Bond Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Asset Backed Securities -- 7.1%
Principal
Amount Value
------------------------------------------------------------
$ 500,000 Chase Manhattan Auto Owner Tr.
2003-A A4
2.06% due 12/15/2009 $ 484,447
400,000 PP&L Transition Bond Co. LLC
1999-1 A7
7.05% due 6/25/2009 433,337
Residential Asset Mtg. Prods., Inc.
2003-RZ3 A3
600,000 2.14% due 2/25/2030 593,522
2002-RS5 AI4
495,000 4.428% due 9/25/2030 498,130
300,000 Residential Funding Mortgage Secs.
2003-HS3 AI2
3.15% due 7/25/2018 293,415
------------------------------------------------------------
Total Asset Backed Securities
(Cost $2,317,769) 2,302,851
------------------------------------------------------------
Collateralized Mortgage Obligations -- 6.5%
FHLMC
2430 GD
$ 181,128 6.50% due 11/15/2030 $ 184,011
2744 VC
296,062 5.50% due 4/15/2011 307,368
1650 J
495,000 6.50% due 6/15/2023 521,068
FNMA
2003-74 ZK
132,892 3.50% due 8/25/2033 131,300
2002-55 PC
360,000 5.50% due 4/25/2026 366,808
2001-51 PH
255,000 6.00% due 8/25/2030 264,606
210,796 GNMA
2002-93 NV
4.75% due 2/20/2032 206,245
119,315 Prudential Home Mtg. Secs. Co.
1993-60 A3
6.75% due 12/25/2023 119,159
------------------------------------------------------------
Total Collateralized Mortgage
Obligations
(Cost $2,115,580) 2,100,565
------------------------------------------------------------
Commercial Mortgage Backed Securities -- 2.2%
$ 325,925 GMAC Comm'l. Mtg. Sec., Inc.
1997-C1 A3
6.869% due 7/15/2029 $ 349,164
225,000 Midland Realty Acceptance Corp.
1996-C1 C
7.927% due 8/25/2028 (1) 243,218
121,004 Morgan Stanley Capital I
1999-WF1 A1
5.91% due 11/15/2031 125,781
------------------------------------------------------------
Total Commercial Mortgage Backed
Securities
(Cost $733,846) 718,163
------------------------------------------------------------
Corporate Bonds -- 64.0%
Aerospace and Defense -- 1.6%
$ 500,000 Northrop Grumman Corp.
7.00% due 3/1/2006 $ 532,068
------------------------------------------------------------
Automotive -- 6.4%
500,000 DaimlerChrysler NA Hldg.
7.40% due 1/20/2005 513,535
--------------------------------------------------------
Principal
Amount Value
--------------------------------------------------------
$ 500,000 Delphi Corp.
6.55% due 6/15/2006 $ 525,565
500,000 Ford Motor Credit Co.
7.50% due 3/15/2005 516,655
500,000 General Motors Acceptance Corp.
5.25% due 5/16/2005 511,196
------------
2,066,951
--------------------------------------------------------
Energy -- 4.0%
500,000 Anadarko Petroleum Corp.
6.50% due 5/15/2005 515,393
250,000 Pride Int'l., Inc.
10.00% due 6/1/2009 263,750
500,000 Repsol Int'l. Fin. BV
7.45% due 7/15/2005 525,044
------------
1,304,187
--------------------------------------------------------
Entertainment -- 3.2%
1,000,000 Time Warner, Inc.
5.625% due 5/1/2005 1,024,492
--------------------------------------------------------
Finance Companies -- 9.7%
500,000 American General Fin. Corp.
5.875% due 12/15/2005 522,760
500,000 Capital One Bank
6.875% due 2/1/2006 527,372
500,000 CIT Group, Inc.
6.625% due 6/15/2005 518,639
500,000 General Electric Capital Corp.
6.80% due 11/1/2005 526,870
500,000 Household Fin. Corp.
6.50% due 1/24/2006 527,027
500,000 MBNA America Bank NA
6.50% due 6/20/2006 529,277
------------
3,151,945
--------------------------------------------------------
Financial -- 2.4%
500,000 Bear Stearns Cos., Inc.
3.00% due 3/30/2006 499,519
250,000 Lehman Brothers Hldgs., Inc.
6.25% due 5/15/2006 263,783
------------
763,302
--------------------------------------------------------
Financial-Banks -- 0.8%
250,000 KeyCorp
4.625% due 5/16/2005 254,177
--------------------------------------------------------
Food and Beverage -- 3.2%
500,000 Kellogg Co.
6.00% due 4/1/2006 524,760
500,000 Kraft Foods, Inc.
4.625% due 11/1/2006 511,969
------------
1,036,729
--------------------------------------------------------
Home Construction -- 0.9%
250,000 Lennar Corp.
9.95% due 5/1/2010 278,073
--------------------------------------------------------
Lodging -- 0.8%
250,000 Marriott Int'l., Inc.
6.875% due 11/15/2005 263,241
--------------------------------------------------------
Media-Cable -- 1.7%
500,000 Cox Comm., Inc.
7.75% due 8/15/2006 543,388
--------------------------------------------------------
Natural Gas-Pipelines -- 1.6%
500,000 Duke Energy Field Svcs.
7.50% due 8/16/2005 524,947
--------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
41
.. The Guardian Low Duration Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
------------------------------------------------------------
Principal
Amount Value
------------------------------------------------------------
Paper and Forest Products -- 0.8%
$ 250,000 Abitibi-Consolidated, Inc.
8.30% due 8/1/2005 $ 258,737
------------------------------------------------------------
Real Estate Investment Trust -- 7.1%
505,000 Avalon Bay Communities, Inc.
6.80% due 7/15/2006 541,187
EOP Operating LP
500,000 6.625% due 2/15/2005 512,477
500,000 6.63% due 4/13/2005 515,070
300,000 Gables Realty LP
6.80% due 3/15/2005 307,370
400,000 Simon Ppty. Group LP
6.875% due 10/27/2005 418,506
------------
2,294,610
------------------------------------------------------------
Restaurants -- 0.8%
250,000 YUM! Brands, Inc.
7.45% due 5/15/2005 259,673
------------------------------------------------------------
Services -- 0.8%
250,000 Cendant Corp.
6.875% due 8/15/2006 267,126
------------------------------------------------------------
Supermarkets -- 2.4%
250,000 Kroger Co.
7.375% due 3/1/2005 257,895
500,000 Safeway, Inc.
3.80% due 8/15/2005 504,805
------------
762,700
------------------------------------------------------------
Utilities-Electric and Water -- 6.9%
500,000 Dominion Resources, Inc.
2.80% due 2/15/2005 501,555
500,000 National Rural Utilities Coop. Fin.
3.00% due 2/15/2006 500,631
250,000 Niagara Mohawk Power Corp.
6.625% due 7/1/2005 260,675
500,000 Nisource Fin. Corp.
7.625% due 11/15/2005 530,399
425,000 PSEG Power LLC
6.875% due 4/15/2006 450,897
------------
2,244,157
------------------------------------------------------------
Wireless Communications -- 1.6%
498,000 AT & T Wireless Svcs., Inc.
6.875% due 4/18/2005 514,890
------------------------------------------------------------
Wireline Communications -- 7.3%
500,000 British Telecom. PLC
7.875% due 12/15/2005 534,581
500,000 Deutsche Telekom Int'l. Fin. BV
8.25% due 6/15/2005 525,714
250,000 Qwest Corp.
7.20% due 11/1/2004 251,875
500,000 Sprint Capital Corp.
7.90% due 3/15/2005 518,301
500,000 Telefonica Europe BV
7.35% due 9/15/2005 526,947
------------
2,357,418
------------------------------------------------------------
Total Corporate Bonds
(Cost $20,783,257) 20,702,811
------------------------------------------------------------
Sovereign Debt Security -- 1.6%
---------------------------------------------------------
Principal
Amount Value
---------------------------------------------------------
$ 500,000 Petroleos Mexicanos
6.50% due 2/1/2005
(Cost $510,816) $ 510,500
---------------------------------------------------------
U.S. Government Securities -- 15.7%
U.S. Treasury Notes -- 15.7%
U.S. Treasury Notes
$ 2,375,000 2.625%, 3/15/2009 $ 2,259,775
2,410,000 3.375%, 12/15/2008 2,379,311
430,000 4.00%, 6/15/2009 433,124
---------------------------------------------------------
Total U.S. Government Securities
(Cost $5,151,926) 5,072,210
---------------------------------------------------------
Repurchase Agreement -- 0.9%
$ 284,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $284,011 at
1.35%, due 7/1/2004 (2)
(Cost $284,000) $ 284,000
---------------------------------------------------------
Total Investments -- 98.0%
(Cost $31,897,194) 31,691,100
Cash, Receivables and Other Assets
Less Liabilities -- 2.0% 660,744
---------------------------------------------------------
Net Assets -- 100% $ 32,351,844
---------------------------------------------------------
(1)Floating rate note. The rate shown is the rate in effect at June 30, 2004.
(2)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
42
.. The Guardian High Yield Bond Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Corporate Bonds -- 90.3%
Rating
Principal Moody's/
Amount S&P* Value
- -----------------------------------------------------------
Aerospace and Defense -- 2.8%
Comm. & Power Inds., Inc.
$ 671,000 Sr. Sub. Nt.
8.00% due 2/1/2012 B3/B- $ 671,000
K & F Ind., Inc.
417,000 Sr. Sub. Nt. Ser. B
9.625% due 12/15/2010 B3/B 457,136
Sequa Corp.
800,000 Sr. Nt.
8.875% due 4/1/2008 B1/BB- 842,000
----------
1,970,136
- -----------------------------------------------------------
Automotive -- 3.5%
Keystone Automotive
Operations
522,000 Sr. Sub. Nt.+
9.75% due 11/1/2013 B3/B- 558,540
Tenneco Automotive, Inc.
298,000 Sr. Sec. Nt. Ser. B
10.25% due 7/15/2013 B2/B- 336,740
596,000 Sr. Sub. Nt. Ser. B
11.625% due 10/15/2009 B3/B- 640,700
TRW Automotive, Inc.
248,000 Sr. Nt.
9.375% due 2/15/2013 B1/BB- 279,620
United Components, Inc.
667,000 Sr. Sub. Nt.
9.375% due 6/15/2013 B3/B 680,340
----------
2,495,940
- -----------------------------------------------------------
Banking -- 0.5%
Western Financial Bank
350,000 Sub. Cap. Debt.
9.625% due 5/15/2012 B1/BB- 385,000
- -----------------------------------------------------------
Building Materials -- 1.8%
Associated Materials, Inc.
745,000 Sr. Disc. Nt. (1)+
0/11.25% due 3/1/2014 Caa1/B- 499,150
Norcraft Cos. Fin.
343,000 Sr. Sub. Nt.+
9.00% due 11/1/2011 B3/B- 361,865
Ply Gem Inds., Inc.
447,000 Sr. Sub. Nt.+
9.00% due 2/15/2012 B3/B- 455,940
----------
1,316,955
- -----------------------------------------------------------
Chemicals -- 7.4%
BCP Caylux Hldgs.
Luxembourg SCA
745,000 Sr. Sub. Nt.+
9.625% due 6/15/2014 B3/B- 772,006
Equistar Chemicals LP
670,000 Sr. Nt.
10.125% due 9/1/2008 B2/B+ 733,650
HMP Equity Hldgs. Corp.
372,000 Sr. Disc. Nt. (2)+
9.83% due 5/15/2008 NR/CCC+ 215,760
Huntsman Advanced Materials
373,000 Sr. Sec. Nt.+
11.00% due 7/15/2010 B2/B 420,557
Huntsman Int'l. LLC
224,000 Sr. Nt.
9.875% due 3/1/2009 B3/B- 241,920
- --------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- --------------------------------------------------------------
Huntsman LLC
$ 373,000 Sr. Nt.+
11.50% due 7/15/2012 B3/CCC+ $ 377,663
Koppers, Inc.
584,000 Sec. Nt.
9.875% due 10/15/2013 B2/B 639,480
Lyondell Chemical Co.
372,000 Sr. Sub. Nt.
10.875% due 5/1/2009 B3/B- 388,740
Millennium America, Inc.
484,000 Sr. Nt.
9.25% due 6/15/2008 B1/BB- 520,300
Nalco Co.
298,000 Sr. Sub. Nt.+
8.875% due 11/15/2013 Caa1/B- 312,155
Nalco Finance Hdgs., Inc.
292,000 Sr. Nt. (1)+
0/9.00% due 2/1/2014 Caa2/B- 195,640
Resolution Performance Product
298,000 Sr. Sec. Nt.
8.00% due 12/15/2009 B2/B+ 309,175
150,000 Sr. Sec. Nt.
9.50% due 4/15/2010 B3/B- 154,500
----------
5,281,546
- --------------------------------------------------------------
Construction Machinery -- 2.7%
Joy Global, Inc.
140,000 Sr. Sub. Nt.
8.75% due 3/15/2012 B1/B+ 156,800
NMHG Hldg. Co.
140,000 Sr. Nt.
10.00% due 5/15/2009 B3/B+ 154,000
Terex Corp.
285,000 Sr. Sub. Nt.
9.25% due 7/15/2011 B3/B 310,650
285,000 Sr. Sub. Nt.
10.375% due 4/1/2011 B3/B 317,775
United Rentals NA, Inc.
1,043,000 Sr. Sub. Nt.
7.75% due 11/15/2013 B2/B+ 985,635
----------
1,924,860
- --------------------------------------------------------------
Consumer Products -- 4.1%
Bombardier Recreational
Products
286,000 Sr. Sub. Nt.+
8.375% due 12/15/2013 B3/B- 283,855
Elizabeth Arden, Inc.
410,000 Sr. Sub. Nt.
7.75% due 1/15/2014 B3/B- 417,175
Jafra Cosmetics
828,000 Sr. Sub. Nt.
10.75% due 5/15/2011 B3/B- 923,220
Rayovac Corp.
745,000 Sr. Sub. Nt.
8.50% due 10/1/2013 B3/B- 782,250
Syratech Corp.
596,000 Sr. Nt.
11.00% due 4/15/2007 Caa1/NR 518,520
----------
2,925,020
- --------------------------------------------------------------
Electric -- 11.4%
Allegheny Energy Supply
1,490,000 Nt.
7.80% due 3/15/2011 B3/CCC+ 1,456,475
- --------------------------------------------------------------------------------
See notes to financial statements.
43
.. The Guardian High Yield Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
- ---------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- ---------------------------------------------------------
Calpine Corp.
$ 745,000 Sr. Sec. Nt.+
8.75% due 7/15/2013 NR/B $ 610,900
Calpine Generating Co.
745,000 Sec. Nt.+
11.50% due 4/1/2011 B3/CCC+ 655,600
Dynegy Hldgs., Inc.
745,000 Sr. Sec. Nt.+
10.125% due 7/15/2013 B3/B- 806,462
Edison Mission Energy
745,000 Sr. Nt.
10.00% due 8/15/2008 B2/B 795,288
Mission Energy Hldg.
745,000 Sr. Sec. Nt.
13.50% due 7/15/2008 Caa2/CCC 833,469
NRG Energy, Inc.
596,000 Sec. Nt.+
8.00% due 12/15/2013 B2/B+ 601,960
Reliant Energy, Inc.
298,000 Sec. Nt.
9.25% due 7/15/2010 B1/B 318,115
Reliant Resources, Inc.
745,000 Sec. Nt.
9.50% due 7/15/2013 B1/B 802,737
Sierra Pacific Resources
1,341,000 Sr. Nt.+
8.625% due 3/15/2014 B2/B- 1,307,475
----------
8,188,481
- ---------------------------------------------------------
Energy -- 3.3%
Belden & Blake Corp.
447,000 Sr. Sub. Nt. Ser. B
9.875% due 6/15/2007 Caa2/CCC+ 458,175
Chesapeake Energy Corp.
149,000 Sr. Nt.+
7.50% due 6/15/2014 Ba3/BB- 153,470
Dresser, Inc.
447,000 Sr. Nt.
9.375% due 4/15/2011 B2/B 478,290
Newpark Resources, Inc.
700,000 Sr. Sub. Nt. Ser. B
8.625% due 12/15/2007 B2/B+ 710,500
Pride Int'l., Inc.
219,000 Sr. Nt.+
7.375% due 7/15/2014 Ba2/BB- 221,190
Western Oil Sands, Inc.
298,000 Sr. Sec. Nt.
8.375% due 5/1/2012 Ba2/BB+ 323,330
----------
2,344,955
- ---------------------------------------------------------
Entertainment -- 2.0%
Intrawest Corp.
447,000 Sr. Nt.
7.50% due 10/15/2013 B1/B+ 436,943
Six Flags, Inc.
1,005,000 Sr. Nt.+
9.625% due 6/1/2014 B3/B- 999,975
----------
1,436,918
- ---------------------------------------------------------
Environmental -- 0.5%
Allied Waste NA, Inc.
335,000 Sr. Nt.
7.875% due 4/15/2013 Ba3/BB- 350,075
- ---------------------------------------------------------
- --------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- --------------------------------------------------------------
Food and Beverage -- 6.8%
American Seafood Group LLC
$ 560,000 Sr. Sub. Nt.
10.125% due 4/15/2010 B3/B $ 672,000
B & G Foods, Inc.
350,000 Sr. Sub. Nt. Ser. D
9.625% due 8/1/2007 B3/CCC+ 356,125
Del Monte Corp.
635,000 Sr. Sub. Nt.
9.25% due 5/15/2011 B2/B 693,737
Merisant Co.
968,000 Sr. Sub. Nt.+
9.50% due 7/15/2013 B3/B- 1,030,920
Michael Foods, Inc.
373,000 Sr. Sub. Nt.
8.00% due 11/15/2013 B3/B- 385,123
Premium Standard Farms, Inc.
969,000 Sr. Nt.
9.25% due 6/15/2011 B1/BB 998,070
Seminis Vegetable Seeds, Inc.
670,000 Sr. Sub. Nt.
10.25% due 10/1/2013 B3/B- 728,625
----------
4,864,600
- --------------------------------------------------------------
Gaming -- 0.4%
Sun Int'l. Hotels Ltd.
285,000 Sr. Sub. Nt.
8.875% due 8/15/2011 B2/B 304,238
- --------------------------------------------------------------
Health Care -- 3.2%
Fisher Scientific Int'l., Inc.
382,000 Sr. Sub. Nt.
8.125% due 5/1/2012 B2/B+ 408,740
Fresenius Medical Care
570,000 Capital Tr.
7.875% due 6/15/2011 Ba2/BB- 604,200
Medical Device Mfg., Inc.
366,000 Sr. Sub. Nt.+
10.00% due 7/15/2012 Caa1/B- 373,320
National Nephrology Assocs.,
Inc.
288,000 Sr. Sub. Nt.+
9.00% due 11/1/2011 B1/B 329,760
PerkinElmer, Inc.
560,000 Sr. Sub. Nt.
8.875% due 1/15/2013 Ba3/BB- 611,800
----------
2,327,820
- --------------------------------------------------------------
Home Construction -- 1.3%
Beazer Homes USA, Inc.
149,000 Sr. Nt.
8.375% due 4/15/2012 Ba1/BB 157,195
Meritage Corp.
286,000 Sr. Nt.
9.75% due 6/1/2011 Ba3/BB- 314,600
Standard Pacific Corp.
149,000 Sr. Sub. Nt.
9.25% due 4/15/2012 Ba3/B+ 160,175
WCI Communities, Inc.
280,000 Sr. Sub. Nt.
9.125% due 5/1/2012 Ba3/B 302,400
----------
934,370
- --------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
44
.. The Guardian High Yield Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
- ------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- ------------------------------------------------------------
Industrial-Other -- 0.9%
General Cable Corp.
$ 575,000 Sr. Nt.
9.50% due 11/15/2010 B2/B $ 618,125
- ------------------------------------------------------------
Lodging -- 0.4%
John Q. Hammons Hotels LP
280,000 1st Mtg. Nt. Ser. B
8.875% due 5/15/2012 B2/B 303,800
- ------------------------------------------------------------
Media-Cable -- 4.4%
Charter Comm. Hldgs.
1,043,000 Sr. Nt.
10.25% due 1/15/2010 Ca/CCC- 860,475
Charter Comm. Hldgs. II
744,000 Sr. Nt.+
10.25% due 9/15/2010 Caa1/CCC- 749,580
Charter Comm. Operating LLC
372,000 Sr. Nt.+
8.00% due 4/30/2012 B2/B- 359,910
CSC Hldgs., Inc.
373,000 Sr. Debt. Ser. B
8.125% due 8/15/2009 B1/BB- 387,920
Insight Comm., Inc.
298,000 Sr. Disc. Nt. (1)
0/12.25% due 2/15/2011 Caa2/B- 268,200
Insight Midwest LP
52,000 Sr. Nt.
10.50% due 11/1/2010 B2/B+ 56,680
321,000 Sr. Nt.+
10.50% due 11/1/2010 B2/B+ 349,890
Kabel Deutschland GmbH
146,000 Sr. Nt.+
10.625% due 7/1/2014 B3/B 150,015
----------
3,182,670
- ------------------------------------------------------------
Media-NonCable -- 4.3%
American Media Operations,
Inc.
570,000 Sr. Sub. Nt. Ser. B
10.25% due 5/1/2009 B2/B- 591,375
Dex Media East LLC
540,000 Sr. Sub. Nt.
12.125% due 11/15/2012 Caa1/B 630,450
DirecTV Hldgs. Finance
278,000 Sr. Nt.
8.375% due 3/15/2013 B1/BB- 307,537
Houghton Mifflin Co.
1,043,000 Sr. Sub. Nt.
9.875% due 2/1/2013 B3/B 1,043,000
R.H. Donnelley Fin. Corp. I
465,000 Sr. Sub. Nt.+
10.875% due 12/15/2012 B2/B+ 539,400
----------
3,111,762
- ------------------------------------------------------------
Metals and Mining -- 1.8%
AK Steel Corp.
372,000 Sr. Nt.
7.75% due 6/15/2012 B3/B+ 335,730
671,000 Sr. Nt.
7.875% due 2/15/2009 B3/B+ 627,385
Luscar Coal Ltd.
286,000 Sr. Nt.
9.75% due 10/15/2011 Ba3/BB 321,750
----------
1,284,865
- ------------------------------------------------------------
- --------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- --------------------------------------------------------------
Natural Gas-Pipelines -- 5.0%
El Paso Natural Gas
$ 670,000 Sr. Nt.
7.625% due 8/1/2010 B1/B- $ 686,750
El Paso Partners
372,000 Sr. Sub. Nt. Ser. B
8.50% due 6/1/2011 B1/BB- 402,690
El Paso Production Hldg.
965,000 Sr. Nt.
7.75% due 6/1/2013 B3/B- 885,387
Gulfterra Energy Partners
32,000 Sr. Sub. Nt. Ser. B
8.50% due 6/1/2010 B1/BB- 34,800
Northwest Pipeline Corp.
208,000 Sr. Nt.
8.125% due 3/1/2010 B1/B+ 224,120
Southern Natural Gas Co.
623,000 Nt.
7.35% due 2/15/2031 B1/B- 557,585
Transcontinental Gas Pipeline
Corp.
180,000 Nt. Ser. B
7.00% due 8/15/2011 B1/B+ 184,500
Williams Cos., Inc.
600,000 Nt.
8.125% due 3/15/2012 B3/B+ 640,500
----------
3,616,332
- --------------------------------------------------------------
Noncaptive Consumer -- 0.8%
Dollar Financial Group, Inc.
559,000 Sr. Nt.
9.75% due 11/15/2011 B3/B 584,155
- --------------------------------------------------------------
Non Sovereign -- 0.5%
Gazprom OAO
328,000 Nt.+
9.625% due 3/1/2013 NR/BB- 337,430
- --------------------------------------------------------------
Packaging -- 0.9%
Crown European Hldgs. S.A.
355,000 Sec. Nt.
9.50% due 3/1/2011 B1/B+ 386,950
Silgan Hldgs., Inc.
298,000 Sr. Sub. Nt.
6.75% due 11/15/2013 B1/B+ 289,060
----------
676,010
- --------------------------------------------------------------
Paper and Forest Products -- 4.1%
Georgia-Pacific Corp.
447,000 Sr. Nt.
9.375% due 2/1/2013 Ba2/BB+ 511,815
Graphic Packaging Int'l., Inc.
522,000 Sr. Sub. Nt.
9.50% due 8/15/2013 B3/B- 566,370
Millar Western Forest
298,000 Sr. Nt.
7.75% due 11/15/2013 B3/B+ 299,490
Stone Container Corp.
745,000 Sr. Nt.
8.375% due 7/1/2012 B2/B 778,525
Tembec Inds., Inc.
745,000 Sr. Nt.
8.625% due 6/30/2009 Ba3/BB- 754,312
----------
2,910,512
- --------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
45
.. The Guardian High Yield Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
- -----------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- -----------------------------------------------------------
Retailers -- 4.1%
Cole National Group, Inc.
$ 280,000 Sr. Sub. Nt.
8.875% due 5/15/2012 B3/B $ 298,900
CSK Auto, Inc.
143,000 Sr. Nt.+
7.00% due 1/15/2014 B2/B- 136,208
J.C. Penney Co., Inc.
596,000 Nt.
8.00% due 3/1/2010 Ba3/BB+ 666,030
720,000 Nt.
9.00% due 8/1/2012 Ba3/BB+ 849,600
Petco Animal Supplies, Inc.
285,000 Sr. Sub. Nt.
10.75% due 11/1/2011 B2/B+ 319,200
Rite Aid Corp.
280,000 Sr. Nt.
11.25% due 7/1/2008 Caa1/B- 308,700
Sonic Automotive, Inc.
373,000 Sr. Sub. Nt.
8.625% due 8/15/2013 B2/B+ 388,852
----------
2,967,490
- -----------------------------------------------------------
Supermarkets -- 0.4%
Pathmark Stores, Inc.
284,000 Sr. Sub. Nt.
8.75% due 2/1/2012 B2/B 284,000
- -----------------------------------------------------------
Technology -- 2.9%
AMI Semiconductor, Inc.
361,000 Sr. Sub. Nt.
10.75% due 2/1/2013 B3/B 421,468
Amkor Technologies, Inc.
298,000 Sr. Nt.+
7.125% due 3/15/2011 B1/B 279,375
Da-Lite Screen Co., Inc.
224,000 Sr. Nt.+
9.50% due 5/15/2011 B2/B- 232,960
Iron Mountain, Inc.
700,000 Sr. Sub. Nt.
8.625% due 4/1/2013 B3/B 742,000
New Asat (Finance) Ltd.
373,000 Sr. Nt.+
9.25% due 2/1/2011 B3/B 369,270
----------
2,045,073
- -----------------------------------------------------------
Textile -- 2.8%
Oxford Inds., Inc.
300,000 Sr. Nt.+
8.875% due 6/1/2011 B2/B 316,500
Russell Corp.
350,000 Sr. Nt.
9.25% due 5/1/2010 B1/BB- 371,875
St. John Knits Int'l., Inc.
750,000 Sr. Sub. Nt.
12.50% due 7/1/2009 B3/B- 804,375
William Carter Co.
422,000 Sr. Sub. Nt. Ser. B
10.875% due 8/15/2011 B3/B+ 477,915
----------
1,970,665
- -----------------------------------------------------------
- --------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- --------------------------------------------------------------
Transportation -- 0.7%
Omi Corp.
$ 220,000 Sr. Nt.
7.625% due 12/1/2013 B1/B+ $ 215,600
Teekay Shipping Corp.
280,000 Sr. Nt.
8.875% due 7/15/2011 Ba2/BB- 309,750
-----------
525,350
- --------------------------------------------------------------
Wireless Communications -- 3.0%
Centennial Cell Comm. Corp.
700,000 Sr. Nt.
10.125% due 6/15/2013 Caa1/CCC 722,750
Inmarsat Finance PLC
75,000 Nt.+
7.625% due 6/30/2012 B2/B 72,563
Nextel Comm., Inc.
700,000 Sr. Nt.
7.375% due 8/1/2015 B2/BB 707,000
Nextel Partners, Inc.
350,000 Sr. Nt.
8.125% due 7/1/2011 Caa1/B- 357,000
Ubiquitel Operating Co.
298,000 Sr. Nt.+
9.875% due 3/1/2011 Caa1/CCC 298,000
-----------
2,157,313
- --------------------------------------------------------------
Wireline Communications -- 1.6%
Qwest Corp.
855,000 Debt.
7.20% due 11/10/2026 Ba3/BB- 735,300
Qwest Svcs. Corp.
355,000 Nt.+
13.50% due 12/15/2010 Caa1/B 412,688
-----------
1,147,988
- --------------------------------------------------------------
Total Corporate Bonds
(Cost $63,066,628) 64,774,454
- --------------------------------------------------------------
Sovereign Debt Security -- 0.7%
Federative Republic of Brazil
$ 575,000 Nt. B2/B+
9.25% due 10/22/2010
(Cost $569,626) $ 544,812
- --------------------------------------------------------------
Warrant -- 0.0%
Shares Value
- --------------------------------------------------------------
XM Satellite Radio, Inc.
330 exp. 3/15/2010
(Cost $66,660) $ 18,150
- --------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
46
.. The Guardian High Yield Bond Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
Repurchase Agreement -- 6.4%
Principal
Amount Value
- --------------------------------------------------------------------
$ 4,571,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $4,571,171 at
1.35% due 7/1/2004 (3)
(Cost $4,571,000) $ 4,571,000
- -----------------------------------------------------------------
Total Investments -- 97.4%
(Cost $68,273,914) 69,908,416
Cash, Receivables and Other Assets
Less Liabilities -- 2.6% 1,842,735
- -----------------------------------------------------------------
Net Assets -- 100% $71,751,151
- -----------------------------------------------------------------
* Unaudited.
+ Rule 144A restricted security.
(1)Step-up bond.
(2)Discount note. The rate shown is the effective yield at date of purchase.
(3)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
47
.. The Guardian Tax-Exempt Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Municipal Bonds -- 106.6%
Rating
Principal Moody's/
Amount S&P* Value
- -----------------------------------------------------------------
Alabama -- 1.2%
$ 1,000,000 Alabama 21st Century Auth.
Tobacco Settlement Rev.,
5.25% due 12/1/2009 Baa1/A- $ 1,014,970
- -----------------------------------------------------------------
Alaska -- 0.3%
250,000 Northern Tobacco
Securitization Corp.,
5.40% due 6/1/2008 Baa2/BBB 248,685
- -----------------------------------------------------------------
Arizona -- 7.2%
1,500,000 Mesa, AZ Street & Hwy.
Rev.,
5.125% due 7/1/2023 Aaa/AAA 1,539,510
1,500,000 Phoenix, AZ Civic Impt.
Corp. Wtr. Sys. Rev.,
5.50% due 7/1/2020 Aaa/AAA 1,610,085
1,000,000 Phoenix, AZ G.O. Ser. B,
5.375% due 7/1/2020 Aa1/AA+ 1,069,220
1,910,000 Tempe, AZ Excise Tax Rev.,
5.00% due 7/1/2009 Aaa/AAA 2,067,269
-----------
6,286,084
- -----------------------------------------------------------------
Arkansas -- 1.3%
1,000,000 Arkansas St. G.O. Fed. Hwy.
Grant Ser. A,
5.50% due 8/1/2011 Aa2/AA 1,099,790
- -----------------------------------------------------------------
California -- 14.8%
4,000,000 California St. Dept. Wtr.
Resources Pwr. Supply Rev.,
1.04% due 5/1/2022 (1) Aaa/AA- 4,000,000
3,000,000 California St. Econ. G.O.
Ser. B,
5.00% due 7/1/2023 Aa3/AA- 3,235,530
California St. G.O.,
500,000 1.00% due 5/1/2033 (1) Aaa/A 500,000
2,000,000 5.25% due 11/1/2027 A3/BBB 1,999,840
2,000,000 California St. Pub. Wks. Brd.
Dept. of Mental Hlth.,
5.50% due 6/1/2023 Baa1/BBB- 2,042,760
1,250,000 Metropolitan Wtr. Dist.
South California Wtrwks.
Rev. Ser. B-1,
5.00% due 10/1/2029 Aaa/AAA 1,242,812
-----------
13,020,942
- -----------------------------------------------------------------
Colorado -- 2.8%
1,120,000 La Plata Cnty., CO Sch. Dist.,
5.25% due 11/1/2015 Aaa/NR 1,220,677
1,205,000 Teller Cnty., CO Sch. Dist.,
5.00% due 12/1/2016 Aaa/AAA 1,282,385
-----------
2,503,062
- -----------------------------------------------------------------
Florida -- 5.4%
2,000,000 Florida St. Brd. of Ed. Lottery
Rev. Ser. A,
5.50% due 7/1/2017 Aaa/AAA 2,167,400
1,500,000 Florida St. Brd. of Ed. Lottery
Rev. Ser. C,
5.25% due 7/1/2016 Aaa/AAA 1,619,070
1,000,000 Lakes By The Bay
South Community,
6.25% due 5/1/2034 NR/NR 998,950
-----------
4,785,420
- -----------------------------------------------------------------
- ------------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- ------------------------------------------------------------------
Georgia -- 1.6%
$ 1,000,000 Fulton Cnty., GA Dev. Auth.
Rev. Georgia Tech. Foundation
Ser. A,
5.125% due 11/1/2021 Aa1/AA+ $ 1,035,390
350,000 Gainesville, GA Wtr. & Swg.
Rev.,
5.25% due 11/15/2018 Aaa/AAA 370,311
------------
1,405,701
- ---------------------------------------------------------------
Idaho -- 2.0%
1,625,000 Boise City, ID Urban
Renewal Agy. Lease,
6.00% due 8/15/2023 Aaa/AAA 1,783,860
- ---------------------------------------------------------------
Illinois -- 4.2%
1,000,000 Chicago, IL Brd. of Ed.
Ser. A,
5.25% due 12/1/2018 Aaa/AAA 1,056,970
2,500,000 Illinois St. Unemployment
Insurance,
5.00% due 12/15/2007 Aaa/AAA 2,676,725
------------
3,733,695
- ---------------------------------------------------------------
Iowa -- 2.1%
1,955,000 Tobacco Settlement Auth. IA
Rev. Ser. B,
5.50% due 6/1/2011 Baa3/BBB 1,864,210
- ---------------------------------------------------------------
Maryland -- 3.5%
1,500,000 Prince Georges Cnty., MD
Industrial Dev. Auth. Ref.,
5.00% due 6/30/2019 Aaa/AAA 1,563,915
1,500,000 Prince Georges Cnty., MD
Pub. Impt. Ser. A,
5.00% due 10/1/2021 Aa2/AA 1,546,905
------------
3,110,820
- ---------------------------------------------------------------
Massachusetts -- 5.1%
2,000,000 Massachusetts Bay Trans.
Auth. Rev. Ser. A,
5.00% due 7/1/2027 Aa1/AAA 1,975,760
1,500,000 Massachusetts St. Special
Obligation Rev.,
5.25% due 1/1/2028 Aaa/AAA 1,526,910
1,000,000 Massachusetts St. Wtr.
Resources Auth. Rev. Ser.A,
5.00% due 8/1/2029 Aaa/AAA 984,510
------------
4,487,180
- ---------------------------------------------------------------
Minnesota -- 1.7%
1,500,000 St. Paul, MN Port Auth.
Lease Rev.,
5.125% due 12/1/2027 Aa2/AA+ 1,514,970
- ---------------------------------------------------------------
New Mexico -- 1.3%
1,000,000 New Mexico St. Hwy. Comm.
Tax Rev. Preref.,
6.00% due 6/15/2010 (2) Aa2/AA+ 1,129,950
- ---------------------------------------------------------------
New York -- 5.4%
1,255,000 New York City Industrial Dev.
Agy.,
5.25% due 3/1/2018 Aaa/AAA 1,334,718
3,200,000 New York St. Housing Fin.
Agy. Rev.,
6.00% due 11/1/2006 A3/A+ 3,422,944
------------
4,757,662
- ---------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
48
.. The Guardian Tax-Exempt Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
- -----------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- -----------------------------------------------------------------
North Dakota -- 1.2%
$ 1,000,000 North Dakota St. Wtr. Comm.
Rev.,
5.75% due 8/1/2020 Aaa/AAA $ 1,095,140
- -----------------------------------------------------------------
Ohio -- 3.8%
750,000 Ohio St. Bldg. Auth. Disalle
Gov't. Ctr. Ser. A,
6.00% due 10/1/2005 Aa2/AA 787,748
1,300,000 Ohio St. Higher Ed. Fac.
Comm.,
5.50% due 12/1/2020 Aaa/AAA 1,389,570
1,050,000 Univ. of Cincinnati, OH
General Rcpts. Ser. A,
5.50% due 6/1/2011 Aaa/AAA 1,172,976
-----------
3,350,294
- -----------------------------------------------------------------
Pennsylvania -- 2.5%
Delaware River Port
Auth. PA & NJ,
1,000,000 5.10% due 1/1/2020 Aaa/AAA 1,038,410
1,000,000 6.00% due 1/1/2017 Aaa/AAA 1,119,570
-----------
2,157,980
- -----------------------------------------------------------------
Puerto Rico -- 12.0%
1,000,000 Puerto Rico Comwlth. Pub.
Impt. Ser. A,
5.25% due 7/1/2017 Baa1/A- 1,054,170
1,000,000 Puerto Rico Muni. Fin. Agency
Ser. A,
5.25% due 8/1/2021 Aaa/AAA 1,053,710
1,500,000 Puerto Rico Pub. Bldgs. Auth.
Rev. Gov't. Facs. Ser. I,
5.50% due 7/1/2020 Baa1/A- 1,586,175
2,000,000 Puerto Rico Pub. Bldgs. Auth.
Rev. Ref. Gov't. Facs. Ser. J,
5.00% due 7/1/2036 Aaa/AAA 2,152,560
2,400,000 Puerto Rico Pub. Bldgs. Auth.
Rev. Ref. Gov't. Facs. Ser. K,
4.50% due 7/1/2022 Baa1/A- 2,499,288
2,000,000 Puerto Rico Pub. Fin. Corp.
Comwlth. Approp. Ser. A,
5.75% due 8/1/2027 Baa2/BBB+ 2,188,320
-----------
10,534,223
- -----------------------------------------------------------------
South Carolina -- 4.8%
350,000 Charleston Cnty., SC Sch. Dist.
Ref. Ser. B,
5.00% due 2/1/2016 Aa1/AA+ 365,676
1,250,000 Charleston, SC Wtrwks. & Swr.
Rev.,
5.25% due 1/1/2018 Aa3/AA- 1,314,700
1,500,000 Charleston, SC Wtrwks. & Swr.
Rev. Ser. B,
5.00% due 1/1/2028 Aa3/AA- 1,485,660
1,000,000 Mount Pleasant, SC Wtr. &
Swr. Rev. Ref. & Impt.,
5.25% due 12/1/2019 Aaa/AAA 1,062,010
-----------
4,228,046
- -----------------------------------------------------------------
Tennessee -- 2.8%
700,000 Knox Cnty., TN
Pub. Impt. G.O.,
5.375% due 5/1/2020 Aa2/AA 738,479
1,700,000 Tennessee Housing Dev.
Agy. Mtg. Fin. Ser. A,
5.20% due 7/1/2023 Aa2/AA 1,717,000
-----------
2,455,479
- -----------------------------------------------------------------
- -----------------------------------------------------------------
Rating
Principal Moody's/
Amount S&P* Value
- -----------------------------------------------------------------
Texas -- 4.7%
$ 2,000,000 Harris Cnty., TX Ref. Ser. B,
5.00% due 8/15/2032 Aaa/AAA $ 2,155,920
2,000,000 Texas St. Wtr. Finl. Assistance
Ser. C & D,
5.00% due 8/1/2027 Aa1/AA 1,959,700
-----------
4,115,620
- -----------------------------------------------------------------
Virginia -- 7.5%
3,000,000 Fairfax Cnty., VA Ref. Pub.
Impt. Ser. A,
4.25% due 6/1/2008 Aaa/AAA 3,155,160
1,500,000 Riverside, VA Regional Jail
Auth. Rev.,
5.00% due 7/1/2021 Aaa/AAA 1,536,960
1,790,000 Virginia St. Pub. Sch. Auth.
Ser. A,
5.00% due 8/1/2019 Aa1/AA+ 1,861,099
-----------
6,553,219
- -----------------------------------------------------------------
Washington -- 5.3%
1,250,000 Cowlitz Cnty., WA Sch. Dist.
G.O.,
5.50% due 12/1/2019 Aaa/NR 1,335,200
1,250,000 Snohomish Cnty., WA G.O.,
5.375% due 12/1/2019 Aaa/AAA 1,329,487
2,000,000 Tobacco Settlement Auth. WA
Rev.,
6.25% due 6/1/2011 Baa3/BBB 1,984,420
-----------
4,649,107
- -----------------------------------------------------------------
Wisconsin -- 2.1%
Badger Tobacco Asset
Securitization Corp.,
1,000,000 5.75% due 6/1/2012 Baa3/BBB 951,770
1,000,000 6.00% due 6/1/2017 Baa3/BBB 905,610
-----------
1,857,380
- -----------------------------------------------------------------
Total Municipal Bonds
(Cost $92,369,079) 93,743,489
- -----------------------------------------------------------------
Total Investments -- 106.6%
(Cost $92,369,079) 93,743,489
Liabilities in Excess of Cash, Receivables
and Other Assets -- (6.6)% (5,796,131)
- -----------------------------------------------------------------
Net Assets -- 100% $87,947,358
- -----------------------------------------------------------------
* Unaudited.
(1)Variable rate demand notes.
(2)Pre-refunded.
Glossary:
G.O. -- General Obligation.
- --------------------------------------------------------------------------------
See notes to financial statements.
49
.. The Guardian Cash Management Fund
Schedule of Investments
June 30, 2004 (Unaudited)
Corporate Bonds -- 1.8%
Principal Maturity
Amount Date Value
- ------------------------------------------------------------------
Capital Markets -- 1.1%
$ 5,000,000 Goldman Sachs Group, Inc.
7.50% 1/28/2005 $ 5,175,595
- ------------------------------------------------------------------
Wireline Communications -- 0.7%
3,500,000 NYNEX Capital Funding
8.75% 12/1/2004 3,607,320
- ------------------------------------------------------------------
Total Corporate Bonds
(Cost $8,782,915) 8,782,915
- ------------------------------------------------------------------
Municipal Bonds -- 2.2%
$ 6,000,000 Connecticut St. Ref. Ser. B
5.97% 8/1/2004 $ 6,023,340
5,000,000 New York St. Urban Dev.
Corp. Rev.
2.08% 12/15/2004 5,018,809
- ------------------------------------------------------------------
Total Municipal Bonds
(Cost $11,042,149) 11,042,149
- ------------------------------------------------------------------
U.S. Government Securities -- 5.4%
U.S. Government Agency Securities -- 5.4%
FHLB
$ 4,000,000 1.125% 10/1/2004 $ 3,999,045
6,000,000 1.44% 3/8/2005 6,000,000
7,000,000 2.23% 7/6/2005 7,000,000
10,000,000 FNMA
1.65% 5/16/2005 10,000,000
- ------------------------------------------------------------------
Total U.S. Government Securities
(Cost $26,999,045) 26,999,045
- ------------------------------------------------------------------
Commercial Paper -- 59.2%
ASSET BACKED -- 2.0%
$ 10,000,000 Sheffield Receivables Corp.
1.24% 7/1/2004 $ 10,000,000
- ------------------------------------------------------------------
FINANCIAL -- 22.1%
Capital Markets -- 3.0%
$ 10,000,000 Goldman Sachs Group, Inc.
1.25% 7/2/2004 $ 9,999,653
5,000,000 J.P. Morgan Chase & Co.
1.18% 7/13/2004 4,998,033
-------------
14,997,686
- ------------------------------------------------------------------
Diversified Financial Services -- 3.0%
10,000,000 Citigroup Global Markets
Hldgs., Inc.
1.15% 7/1/2004 10,000,000
5,000,000 Credit Suisse First Boston
1.20% 7/21/2004 4,996,667
-------------
14,996,667
- ------------------------------------------------------------------
Finance Companies -- 3.0%
Private Export Funding Corp.
10,000,000 1.05% 7/13/2004 9,996,500
5,000,000 1.05% 8/24/2004 4,992,125
-------------
14,988,625
- ------------------------------------------------------------------
Financial-Banks -- 7.1%
10,000,000 Dexia Delaware LLC
1.29% 7/29/2004 9,989,966
- ----------------------------------------------------------------
Principal Maturity
Amount Date Value
- ----------------------------------------------------------------
$ 10,000,000 HVB Finance
1.22% 7/26/2004 $ 9,991,528
15,000,000 Societe Generale NA
1.43% 7/1/2004 15,000,000
-------------
34,981,494
- ----------------------------------------------------------------
Financial-Other -- 6.0%
10,000,000 American General Fin. Corp.
1.19% 7/12/2004 9,996,364
10,000,000 Barton Capital Corp.
1.20% 7/12/2004 9,996,333
10,000,000 Govco, Inc.
1.30% 7/21/2004 9,992,778
-------------
29,985,475
- ----------------------------------------------------------------
TOTAL FINANCIAL 109,949,947
- ----------------------------------------------------------------
INDUSTRIAL -- 35.1%
Auto Components -- 3.0%
$ 15,000,000 Johnson Controls, Inc.
1.50% 7/1/2004 $ 15,000,000
- ----------------------------------------------------------------
Automobiles -- 3.0%
15,000,000 BMW US Capital Corp.
1.45% 7/1/2004 15,000,000
- ----------------------------------------------------------------
Beverage -- 2.0%
Coca-Cola Enterprises, Inc.
5,000,000 1.25% 7/21/2004 4,996,528
5,000,000 1.26% 7/26/2004 4,995,625
-------------
9,992,153
- ----------------------------------------------------------------
Chemicals -- 3.0%
15,000,000 Air Products & Chemicals
1.43% 7/1/2004 15,000,000
- ----------------------------------------------------------------
Education -- 1.0%
5,000,000 Northwestern University
1.18% 7/13/2004 4,998,033
- ----------------------------------------------------------------
Food and Staples Retailing -- 2.2%
10,600,000 Wal-Mart Stores, Inc.
1.23% 7/7/2004 10,597,827
- ----------------------------------------------------------------
Food Products -- 2.0%
Sara Lee Corp.
5,000,000 1.10% 7/1/2004 5,000,000
5,000,000 1.45% 7/2/2004 4,999,799
-------------
9,999,799
- ----------------------------------------------------------------
Health Care Equipment and Supplies -- 1.0%
5,000,000 Medtronic, Inc.
1.19% 7/6/2004 4,999,174
- ----------------------------------------------------------------
Household Durables -- 3.0%
15,000,000 Fortune Brands, Inc.
1.43% 7/1/2004 15,000,000
- ----------------------------------------------------------------
Household Products -- 3.0%
Procter & Gamble Co.
5,000,000 1.15% 7/14/2004 4,997,923
10,000,000 1.42% 7/1/2004 10,000,000
-------------
14,997,923
- ----------------------------------------------------------------
Media -- 2.1%
10,200,000 Gannett Co., Inc.
1.22% 7/9/2004 10,197,235
- ----------------------------------------------------------------
- --------------------------------------------------------------------------------
See notes to financial statements.
50
.. The Guardian Cash Management Fund
Schedule of Investments (Continued)
June 30, 2004 (Unaudited)
- ---------------------------------------------------------------
Principal Maturity
Amount Date Value
- ---------------------------------------------------------------
Metals and Mining -- 1.0%
$ 5,000,000 Rio Tinto Ltd.
1.20% 7/8/2004 $ 4,998,833
- ---------------------------------------------------------------
Multiline Retail -- 2.0%
10,000,000 Target Corp.
1.30% 7/7/2004 9,997,833
- ---------------------------------------------------------------
Multi-Utilities and Unregulated Power -- 2.2%
10,640,000 Boston Edison Co.
1.30% 7/6/2004 10,638,079
- ---------------------------------------------------------------
Oil and Gas -- 4.6%
8,000,000 Boc Group, Inc.
1.43%+ 7/1/2004 8,000,000
Koch Industries
5,000,000 1.19% 7/15/2004 4,997,686
10,000,000 1.41% 7/1/2004 10,000,000
-------------
22,997,686
- ---------------------------------------------------------------
TOTAL INDUSTRIAL 174,414,575
- ---------------------------------------------------------------
Total Commercial Paper
(Cost $294,364,522) 294,364,522
- ---------------------------------------------------------------
Floating Rate Notes and Bonds -- 22.5%
Principal Reset
Amount Date* Value
- ---------------------------------------------------------------
California -- 4.4%
$ 13,590,000 California Housing Fin.
Agency
1.16% 7/14/2004 $ 13,590,000
8,100,000 Sacramento Cnty., CA
1.14% 7/14/2004 8,100,000
-------------
21,690,000
- ---------------------------------------------------------------
Colorado -- 2.8%
Colorado Housing & Fin.
Auth.
7,900,000 1.15% 7/14/2004 7,900,000
6,000,000 1.15% 7/14/2004 6,000,000
-------------
13,900,000
- ---------------------------------------------------------------
Connecticut -- 1.6%
8,000,000 Connecticut St. Housing &
Fin. Auth.
1.12% 7/8/2004 8,000,000
- ---------------------------------------------------------------
Financial-Other -- 2.0%
10,000,000 Countrywide Home Loan
1.684% 9/24/2004 10,000,634
- ---------------------------------------------------------------
Florida -- 1.6%
8,000,000 Miami Dade Cnty. Florida
Aviation
1.45% 7/14/2004 8,000,000
- ---------------------------------------------------------------
Michigan -- 0.8%
4,000,000 Michigan St. Housing Dev.
Auth.
1.15% 7/14/2004 4,000,000
- ---------------------------------------------------------------
New York -- 3.5%
17,530,000 New York City Transitional
1.15% 7/14/2004 17,530,000
- ---------------------------------------------------------------
- ------------------------------------------------------------------
Principal Reset
Amount Date* Value
- ------------------------------------------------------------------
Utah -- 4.7%
Utah Housing Corp. Single
Family
$ 4,040,000 1.15% 7/14/2004 $ 4,040,000
4,200,000 1.15% 7/14/2004 4,200,000
1,500,000 1.15% 7/14/2004 1,500,000
5,865,000 1.15% 7/14/2004 5,865,000
Utah St. Housing Fin. Agency
3,035,000 1.15% 7/14/2004 3,035,000
4,730,000 1.15% 7/14/2004 4,730,000
-------------
23,370,000
- ------------------------------------------------------------------
Washington -- 1.1%
5,595,000 Seattle, WA
1.55% 9/1/2004 5,595,000
- ------------------------------------------------------------------
Total Floating Rate Notes and Bonds
(Cost $112,085,634) 112,085,634
- ------------------------------------------------------------------
Repurchase Agreement -- 9.2%
Principal
Amount Value
- ------------------------------------------------------------------
$ 45,848,000 State Street Bank and Trust Co.
repurchase agreement,
dated 6/30/2004, maturity
value $45,849,719 at
1.35% due 7/1/2004 (1)
(Cost $45,848,000) $ 45,848,000
- ------------------------------------------------------------------
Total Investments -- 100.3%
(Cost $499,122,265) 499,122,265
Liabilities in Excess of Cash, Receivables and
Other Assets -- (0.3)% (1,716,449)
- ------------------------------------------------------------------
Net Assets -- 100% $ 497,405,816
- ------------------------------------------------------------------
* Floating rate note. The rate shown is the rate in effect at June 30, 2004.
+ Rule 144A restricted security.
(1)The repurchase agreement is fully collateralized by U.S. Government and/or
agency obligations based on market prices at the date of the portfolio.
- --------------------------------------------------------------------------------
See notes to financial statements.
51
.. The Park Avenue Portfolio
Statements of Assets and Liabilities
June 30, 2004 (Unaudited)
- ------------------------------------------
The Guardian The Guardian The Guardian The Guardian The Guardian
Park Avenue UBS Large Park Avenue UBS Small Asset
Fund Cap Value Small Cap Cap Value Allocation
-------------- Fund Fund Fund Fund
------------ ------------ ------------ ------------
ASSETS
Investments, at identified cost (includes majority-
owned subsidiary of $132,417,998 and non-
controlled affiliated issue of $12,081,730 for
GAAF)................................................ $1,082,851,894 $70,431,155 $181,225,942 $34,689,412 $176,024,334
============== ============ ============ ============ ============
Investments, at market -- Note 1 (includes majority-
owned subsidiary of $119,621,343 and non-
controlled affiliated issue of $12,467,877 for
GAAF)................................................ 1,214,267,418 88,343,955 212,449,609 41,917,701 162,729,579
Cash.................................................. 688 409 155 862 670
Foreign Currency (cost $34,800 GBGIF and
$1,150,575 GBGEMF, respectively)..................... -- -- -- -- --
Receivable for securities sold........................ 2,629,800 -- 2,702,747 177,989 --
Dividends receivable.................................. 950,653 57,632 82,081 17,787 66,840
Receivable for fund shares sold....................... 147,153 769 530,272 7,478 83,670
Interest receivable................................... 502 70 196 34 205
Receivable for variation margin -- Note 1............. -- -- -- -- 78,234
Dividend reclaim receivable........................... -- -- -- -- --
Other assets.......................................... 10,168 1,109 1,637 684 1,646
-------------- ------------ ------------ ------------ ------------
Total Assets....................................... 1,218,006,382 88,403,944 215,766,697 42,122,535 162,960,844
-------------- ------------ ------------ ------------ ------------
LIABILITIES
Payable for securities purchased...................... 9,420,277 -- 6,376,618 85,834 --
Payable for fund shares redeemed...................... 1,741,757 -- 530,253 359 306,245
Accrued expenses...................................... 320,570 57,474 48,192 56,872 58,594
Payable for variation margin -- Note 1................ -- -- -- -- 57,000
Accrued foreign capital gains tax..................... -- -- -- -- --
Distributions payable................................. -- -- -- -- --
Payable for forward mortgage securities purchased --
Note 7............................................... -- -- -- -- --
Due to GIS............................................ 872,631 121,349 207,316 62,957 50,014
-------------- ------------ ------------ ------------ ------------
Total Liabilities.................................. 12,355,235 178,823 7,162,379 206,022 471,853
-------------- ------------ ------------ ------------ ------------
Net Assets......................................... $1,205,651,147 $88,225,121 $208,604,318 $41,916,513 $162,488,991
============== ============ ============ ============ ============
COMPONENTS OF NET ASSETS
Shares of beneficial interest, at par................. $ 402,759 $ 69,561 $ 107,959 $ 33,084 $ 150,278
Additional paid-in capital............................ 1,769,656,520 67,458,528 157,907,658 31,710,697 227,700,530
Undistributed/(distribution in excess) of net
investment income.................................... 302,517 (56,883) (937,543) (199,504) 522,978
Accumulated net realized gain/(loss) on investments
and foreign currency related transactions............ (696,126,173) 2,841,114 20,302,577 3,143,947 (52,556,808)
Net unrealized appreciation/(depreciation) of
investment and foreign currency related
transactions......................................... 131,415,524 17,912,801 31,223,667 7,228,289 (13,327,987)
-------------- ------------ ------------ ------------ ------------
Net Assets......................................... $1,205,651,147 $88,225,121 $208,604,318 $41,916,513 $162,488,991
============== ============ ============ ============ ============
NET ASSETS
Class A............................................... $1,042,827,233 $23,081,931 $166,967,430 $11,421,913 $114,614,949
Class B............................................... $ 148,648,389 $22,033,957 $ 22,716,634 $10,333,122 $ 31,542,761
Class C............................................... $ 6,556,974 $21,381,622 $ 8,426,905 $ 9,921,971 $ 8,063,401
Class K............................................... $ 7,618,551 $21,727,611 $ 10,493,349 $10,239,507 $ 8,267,880
Shares of Beneficial Interest Outstanding -- $0.01 Par Value
Class A............................................... 34,629,770 1,817,971 8,545,629 895,573 10,595,485
Class B............................................... 5,161,573 1,739,216 1,241,561 820,095 2,921,459
Class C............................................... 230,781 1,687,454 463,506 787,484 745,997
Class K............................................... 253,728 1,711,455 545,212 805,279 764,830
Net Asset Value Per Share
Class A............................................... $30.11 $12.70 $19.54 $12.75 $10.82
Class B............................................... $28.80 $12.67 $18.30 $12.60 $10.80
Class C............................................... $28.41 $12.67 $18.18 $12.60 $10.81
Class K............................................... $30.03 $12.70 $19.25 $12.72 $10.81
Maximum Offering Price Per Share
Class A (Net Asset Value x 104.71%)*.................. $31.53 $13.30 $20.46 $13.35 $11.33
Class A (Net Asset Value x 103.09%)*.................. -- -- -- -- --
*Based on sale of less than $100,000. On sale of $100,000 or more, the
offering price is reduced.
**No load is charged on Class A shares.
- --------------------------------------------------------------------------------
See notes to financial statements.
52
The Guardian The Guardian The Guardian The Guardian The Guardian The Guardian The Guardian The Guardian
S&P 500 Baillie Gifford Baillie Gifford Investment Low Duration High Yield Tax-Exempt Cash
Index International Emerging Quality Bond Fund Bond Fund Management
Fund Growth Fund Markets Fund Bond Fund ------------ Fund ------------ Fund
- ------------ --------------- --------------- ------------ ------------ ------------
$166,430,326 $ 39,801,653 $69,110,938 $174,746,962 $31,897,194 $ 68,273,914 $92,369,079 $499,122,265
============ =============== =============== ============ ============ ============ ============ ============
166,757,222 51,057,483 79,130,786 174,644,173 31,691,100 69,908,416 93,743,489 499,122,265
90,883 236 301 72,396 54,350 80,287 139,667 122,470
-- 34,814 1,155,832 -- -- -- -- --
-- -- 317,960 4,904,102 731,710 1,438,945 986,640 --
182,482 67,672 128,178 -- -- -- -- --
224,151 5,484 65,386 41,848 55,513 2,254 45,745 152,850
150 3,107 11 1,882,757 367,859 1,448,497 866,667 715,159
16,100 -- -- -- -- -- -- --
-- 76,538 -- -- -- -- -- --
1,494 970 767 2,251 519 912 1,244 5,487
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
167,272,482 51,246,304 80,799,221 181,547,527 32,901,051 72,879,311 95,783,452 500,118,231
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
-- 436,843 1,066,151 -- 433,876 1,013,519 7,722,150 --
45,407 118,402 142,496 359,726 -- 13,713 5,000 2,212,848
44,301 58,901 35,125 62,789 81,293 30,220 37,594 143,678
-- -- -- -- -- -- -- --
-- -- 408 -- -- -- -- --
-- -- -- 139,445 393 -- 5,483 410
-- -- -- 19,974,305 -- -- -- --
92,653 22,118 34,732 131,461 33,645 70,708 65,867 355,479
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
182,361 636,264 1,278,912 20,667,726 549,207 1,128,160 7,836,094 2,712,415
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
$167,090,121 $ 50,610,040 $79,520,309 $160,879,801 $32,351,844 $ 71,751,151 $87,947,358 $497,405,816
============ =============== =============== ============ ============ ============ ============ ============
$ 213,367 $ 44,577 $ 66,931 $ 163,171 $ 32,593 $ 98,654 $ 88,064 $ 4,974,058
263,200,209 80,260,608 65,496,041 160,466,813 32,566,505 87,749,926 85,903,425 492,431,758
147,605 124,178 987 -- -- -- -- --
(96,805,593) (41,082,159) 3,948,280 352,607 (41,160) (17,731,931) 581,459 --
334,533 11,262,836 10,008,070 (102,790) (206,094) 1,634,502 1,374,410 --
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
$167,090,121 $ 50,610,040 $79,520,309 $160,879,801 $32,351,844 $ 71,751,151 $87,947,358 $497,405,816
============ =============== =============== ============ ============ ============ ============ ============
$135,978,639 $ 31,468,797 $48,478,113 $122,641,778 $ 8,976,478 $ 42,574,986 $77,756,332 $469,516,649
$ 12,802,356 $ 6,288,941 $ 9,504,158 $ 17,020,938 $ 8,031,782 $ 9,891,855 -- $ 9,929,301
$ 9,680,520 $ 5,674,585 $ 9,754,030 $ 11,098,558 $ 7,733,245 $ 9,441,425 $10,191,026 $ 8,621,871
$ 8,628,606 $ 7,177,717 $11,784,008 $ 10,118,527 $ 7,610,339 $ 9,842,885 -- $ 9,337,995
17,357,296 2,705,210 3,989,331 12,439,020 904,374 5,853,122 7,785,924 469,516,649
1,637,872 592,854 849,017 1,726,933 809,155 1,360,596 -- 9,929,301
1,239,493 533,569 868,994 1,126,002 779,077 1,298,918 1,020,465 8,621,871
1,101,995 626,050 985,723 1,025,194 766,697 1,352,741 -- 9,337,995
$7.83 $11.63 $12.15 $9.86 $9.93 $7.27 $9.99 $1.00
$7.82 $10.61 $11.19 $9.86 $9.93 $7.27 -- $1.00
$7.81 $10.64 $11.22 $9.86 $9.93 $7.27 $9.99 $1.00
$7.83 $11.47 $11.95 $9.87 $9.93 $7.28 -- $1.00
$8.20 $12.18 $12.72 $10.32 -- $7.61 $10.46 N/A**
-- -- -- -- $10.24 -- -- --
- --------------------------------------------------------------------------------
53
.. The Park Avenue Portfolio
Statements of Operations
Six Months Ended June 30, 2004 (Unaudited)
- ------------------------------------------
The Guardian The Guardian The Guardian The Guardian The Guardian
Park Avenue UBS Large Park Avenue UBS Small Asset
Fund Cap Value Small Cap Cap Value Allocation
------------ Fund Fund Fund Fund
------------ ------------ ------------ ------------
INVESTMENT INCOME
Dividends (includes $534,706 from a majority-owned
subsidiary and $407,301 from a non-controlled
affiliate for GAAF)....................................... $ 8,329,792 $ 886,389 $ 450,633 $ 290,998 $1,088,497
Interest................................................... 52,568 11,691 17,696 4,418 26,889
Less: Foreign tax withheld................................. -- -- (1,962) (283) (29)
------------ ------------ ------------ ------------ ------------
Total Income............................................ 8,382,360 898,080 466,367 295,133 1,115,357
------------ ------------ ------------ ------------ ------------
Expenses:
Investment advisory fees -- Note 2......................... 3,142,683 356,555 768,045 201,626 535,362
Administrative fees -- Class A -- Note 2................... 1,179,456 27,752 204,558 13,503 145,813
Administrative fees -- Class B -- Note 2................... 195,945 26,943 28,476 12,515 40,178
Administrative fees -- Class C -- Note 2................... 8,248 26,197 10,279 12,080 9,868
Administrative fees -- Class K -- Note 2................... 9,303 26,504 12,702 12,309 10,049
12b-1 fees -- Class B -- Note 3............................ 587,834 80,830 85,427 37,545 120,534
12b-1 fees -- Class C -- Note 3............................ 24,745 78,590 30,838 36,241 29,605
12b-1 fees -- Class K -- Note 3............................ 14,884 42,407 20,323 19,694 16,079
Transfer agent fees -- Class A............................. 713,069 15,931 75,524 15,776 80,269
Transfer agent fees -- Class B............................. 233,365 15,436 28,952 15,266 32,088
Transfer agent fees -- Class C............................. 17,563 12,300 15,755 15,048 16,111
Transfer agent fees -- Class K............................. -- 58 -- 40 --
Custodian fees............................................. 111,183 46,020 56,954 42,629 51,395
Printing expense........................................... 68,118 6,360 8,386 4,268 8,148
Registration fees.......................................... 45,814 41,562 34,423 41,583 34,550
Trustees' fees -- Note 2................................... 44,064 2,779 5,371 1,258 5,260
Legal fees................................................. 21,383 874 2,486 497 2,586
Insurance expense.......................................... 18,187 1,558 2,522 881 2,539
Audit fees................................................. 13,824 13,825 11,362 11,362 11,362
Loan commitment fees -- Note 9............................. 10,092 622 1,299 291 1,277
Other...................................................... 1,678 227 228 225 432
------------ ------------ ------------ ------------ ------------
Total Expenses before Reimbursement and
Custody credits........................................ 6,461,438 823,330 1,403,910 494,637 1,153,505
Less: Expenses assumed by investment
adviser -- Note 2...................................... -- -- -- -- (634,866)
Custody credits -- Note 1............................... -- -- -- -- --
------------ ------------ ------------ ------------ ------------
Expenses Net of Reimbursement and Custody
credits................................................ 6,461,438 823,330 1,403,910 494,637 518,639
------------ ------------ ------------ ------------ ------------
Net Investment Income/(Loss)................................ 1,920,922 74,750 (937,543) (199,504) 596,718
------------ ------------ ------------ ------------ ------------
REALIZED AND UNREALIZED GAIN/(LOSS) ON
INVESTMENTS AND FOREIGN CURRENCIES --
NOTE 4
Net realized gain/(loss) on investments -- Note 1.......... 38,300,169 2,885,995 20,812,292 3,155,277 1,277,472
Net realized gain on sale of affiliated underlying
funds..................................................... -- -- -- -- 75,349
Net realized gains received from affiliated underlying
funds..................................................... -- -- -- -- 46,786
Realized foreign capital gains tax......................... -- -- -- -- --
Net realized gain/(loss) on foreign currency related
transactions -- Note 1.................................... -- -- -- -- --
Net change in unrealized appreciation/(depreciation) on
investments -- Note 4..................................... (31,592,987) (656,646) (12,349,534) (932,806) 3,204,083
Unrealized foreign capital gains tax....................... -- -- -- -- --
Net change in unrealized appreciation of futures
contracts -- Note 1....................................... -- -- -- -- (605,651)
Net change in unrealized appreciation from translation of
other assets and liabilities denominated in foreign
currencies -- Note 1...................................... -- -- -- -- --
------------ ------------ ------------ ------------ ------------
Net Realized and Unrealized Gain/(Loss) on
Investments and Foreign Currencies......................... 6,707,182 2,229,349 8,462,758 2,222,471 3,998,039
------------ ------------ ------------ ------------ ------------
NET INCREASE/(DECREASE) IN NET ASSETS
FROM OPERATIONS........................................... $ 8,628,104 $2,304,099 $ 7,525,215 $2,022,967 $4,594,757
============ ============ ============ ============ ============
- --------------------------------------------------------------------------------
See notes to financial statements.
54
The Guardian The Guardian The Guardian The Guardian The Guardian The Guardian The Guardian The Guardian
S&P 500 Baillie Gifford Baillie Gifford Investment Low Duration High Yield Tax-Exempt Cash
Index International Emerging Quality Bond Fund Bond Fund Management
Fund Growth Fund Markets Fund Bond Fund ------------ Fund ------------ Fund
- ------------ --------------- --------------- ------------ ------------ ------------
$1,307,253 $ 778,906 $ 1,125,820 -- -- -- -- --
18,410 9,368 6,069 $ 4,082,821 $ 486,109 $ 2,927,134 $ 1,892,184 $2,961,032
(115) (68,169) (123,855) -- -- -- -- --
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
1,325,548 720,105 1,008,034 4,082,821 486,109 2,927,134 1,892,184 2,961,032
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
203,182 206,587 411,025 429,632 71,895 212,976 222,782 1,295,739
166,171 40,354 62,415 166,197 11,135 52,700 98,445 611,370
15,309 8,157 12,378 22,182 9,830 12,334 -- 14,033
11,555 7,101 12,533 13,967 9,537 11,644 12,946 10,918
10,146 8,946 15,430 12,470 9,440 12,062 -- 11,547
45,928 24,472 37,132 66,547 29,491 37,001 -- 42,101
34,664 21,304 37,600 41,901 28,610 34,933 38,840 32,755
16,233 14,314 24,689 19,952 15,104 19,299 -- 18,475
23,479 49,936 22,573 43,098 14,221 17,809 18,417 185,870
18,841 22,056 17,609 19,789 13,331 16,401 -- 14,075
15,647 15,942 16,066 15,269 13,358 14,834 14,775 3,655
356 37 -- 179 -- 102 -- 805
73,998 103,965 146,420 67,427 34,932 50,526 37,056 71,652
7,623 6,911 4,863 11,712 3,554 5,257 5,292 30,184
42,992 38,322 34,374 41,089 31,891 35,593 17,970 51,907
4,687 2,137 1,894 6,911 1,052 2,309 3,105 19,860
1,989 1,094 844 3,861 497 1,108 995 11,437
2,260 1,055 1,052 3,583 679 1,276 1,639 9,695
11,362 13,923 13,923 11,362 12,183 13,848 11,362 10,940
1,237 456 506 1,362 247 546 692 --
236 1,380 450 437 227 230 232 490
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
707,895 588,449 873,776 998,927 311,214 552,788 484,548 2,447,508
(180,317) -- -- (139,942) (110,195) (159,836) (53,767) (151,376)
-- -- -- -- -- -- (13,207) --
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
527,578 588,449 873,776 858,985 201,019 392,952 417,574 2,296,132
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
797,970 131,656 134,258 3,223,836 285,090 2,534,182 1,474,610 664,900
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
114,570 552,665 7,247,543 494,239 (27,413) 1,362,449 592,384 --
-- -- -- -- -- -- -- --
-- -- -- -- -- -- -- --
-- -- 58,390 -- -- -- -- --
-- 13,845 (57,097) -- -- -- -- --
4,086,552 309,448 (9,738,760) (3,817,555) (297,759) (3,076,875) (3,400,006) --
-- -- (14,696) -- -- -- -- --
(19,180) -- -- -- -- -- -- --
-- 1,181 2,241 -- -- -- -- --
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
4,181,942 877,139 (2,502,379) (3,323,316) (325,172) (1,714,426) (2,807,622) --
- ------------ --------------- --------------- ------------ ------------ ------------ ------------ ------------
$4,979,912 $1,008,795 $(2,368,121) $ (99,480) $ (40,082) $ 819,756 $(1,333,012) $ 664,900
============ =============== =============== ============ ============ ============ ============ ============
- --------------------------------------------------------------------------------
55
.. The Park Avenue Portfolio
Statements of Changes in Net Assets
The Guardian The Guardian
Park Avenue Fund UBS Large Cap Value Fund
------------------------------ -------------------------
Period from
February 3,
Six Months Year Ended Six Months 2003+ to
Ended December 31, Ended December 31,
June 30, 2004 2003 June 30, 2004 2003
(Unaudited) (Audited) (Unaudited) (Audited)
-------------- -------------- ------------- ------------
INCREASE/(DECREASE) IN NET ASSETS
From Operations:
Net investment income/(loss)........................ $ 1,920,922 $ 7,520,558 $ 74,750 $ 251,856
Net realized gain/(loss) on investments and
foreign currency related transactions.............. 38,300,169 (76,280,304) 2,885,995 4,603,444
Net change in unrealized appreciation/
(depreciation) of investments and foreign
currency related transactions...................... (31,592,987) 310,795,254 (656,646) 18,569,447
-------------- -------------- ------------- ------------
Net Increase in Net Assets Resulting from
Operations......................................... 8,628,104 242,035,508 2,304,099 23,424,747
-------------- -------------- ------------- ------------
Dividends and Distributions to Shareholders
from:
Net investment income
Class A............................................ (6,443,966) (7,367,278) (79,899) (130,506)
Class B............................................ -- -- -- (25,664)
Class C............................................ -- -- -- (25,489)
Class K............................................ (37,574) (20,780) (52,463) (69,468)
Net realized gain on investments and foreign
currency related transactions
Class A............................................ -- -- (789,751) (412,361)
Class B............................................ -- -- (760,042) (408,262)
Class C............................................ -- -- (737,416) (397,214)
Class K............................................ -- -- (744,507) (398,772)
-------------- -------------- ------------- ------------
Total Dividends and Distributions to
Shareholders (6,481,540) (7,388,058) (3,164,078) (1,867,736)
-------------- -------------- ------------- ------------
From Capital Share Transactions:
Net increase/(decrease) in net assets from capital
share transactions -- Note 8....................... (109,003,783) (221,597,031) 4,258,045 63,270,044
Redemption fees..................................... -- -- -- --
-------------- -------------- ------------- ------------
(109,003,783) (221,597,031) 4,258,045 63,270,044
-------------- -------------- ------------- ------------
Net Increase/(Decrease) in Net Assets (106,857,219) 13,050,419 3,398,066 84,827,055
NET ASSETS:
Beginning of period.................................... 1,312,508,366 1,299,457,947 84,827,055 --
-------------- -------------- ------------- ------------
End of period*......................................... $1,205,651,147 $1,312,508,366 $88,225,121 $84,827,055
============== ============== ============= ============
* Includes undistributed/(distributions in excess) of
net investment income of.............................. $ 302,517 $ 4,863,135 $ (56,883) $ 729
The Guardian
Park Avenue
Small Cap Fund
--------------------------
Six Months Year Ended
Ended December 31,
June 30, 2004 2003
(Unaudited) (Audited)
------------- ------------
INCREASE/(DECREASE) IN NET ASSETS
From Operations:
Net investment income/(loss)........................ $ (937,543) $ (1,352,534)
Net realized gain/(loss) on investments and
foreign currency related transactions.............. 20,812,292 16,253,102
Net change in unrealized appreciation/
(depreciation) of investments and foreign
currency related transactions...................... (12,349,534) 44,032,029
------------- ------------
Net Increase in Net Assets Resulting from
Operations......................................... 7,525,215 58,932,597
------------- ------------
Dividends and Distributions to Shareholders
from:
Net investment income
Class A............................................ -- --
Class B............................................ -- --
Class C............................................ -- --
Class K............................................ -- --
Net realized gain on investments and foreign
currency related transactions
Class A............................................ (2,048,142) --
Class B............................................ (298,188) --
Class C............................................ (110,554) --
Class K............................................ (130,032) --
------------- ------------
Total Dividends and Distributions to
Shareholders (2,586,916) --
------------- ------------
From Capital Share Transactions:
Net increase/(decrease) in net assets from capital
share transactions -- Note 8....................... 2,643,073 526,138
Redemption fees..................................... -- --
------------- ------------
2,643,073 526,138
------------- ------------
Net Increase/(Decrease) in Net Assets 7,581,372 59,458,735
NET ASSETS:
Beginning of period.................................... 201,022,946 141,564,211
------------- ------------
End of period*......................................... $208,604,318 $201,022,946
============= ============
* Includes undistributed/(distributions in excess) of
net investment income of.............................. $ (937,543) $ --
+ Commencementof operations.
- --------------------------------------------------------------------------------
See notes to financial statements.
56
The Guardian
The Guardian The Guardian The Guardian Baillie Gifford
UBS Small Cap Value Fund Asset Allocation Fund S&P 500 Index Fund International Growth Fund
- ------------------------- -------------------------- -------------------------- -------------------------
Period from
February 3,
Six Months 2003+ to Six Months Year Ended Six Months Year Ended Six Months Year Ended
Ended December 31, Ended December 31, Ended December 31, Ended December 31,
June 30, 2004 2003 June 30, 2004 2003 June 30, 2004 2003 June 30, 2004 2003
(Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited)
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
$ (199,504) $ (172,665) $ 596,718 $ 1,589,028 $ 797,970 $ 1,531,499 $ 131,656 $ 112,017
3,155,277 4,660,235 1,399,607 2,070,307 114,570 (317,473) 566,510 (4,580,776)
(932,806) 8,161,095 2,598,432 33,756,586 4,067,372 32,458,190 310,629 18,741,326
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
2,022,967 12,648,665 4,594,757 37,415,921 4,979,912 33,672,216 1,008,795 14,272,567
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
-- -- (1,340,355) (1,836,307) (605,231) (1,405,045) (89,371) (63,805)
-- -- (105,509) (225,527) (18,577) (50,103) -- --
-- -- (8,015) (29,885) (13,872) (36,942) -- --
-- -- (68,620) (81,064) (23,636) (55,604) -- --
(538,495) (651,609) -- -- -- -- -- --
(492,139) (632,339) -- -- -- -- -- --
(473,674) (613,490) -- -- -- -- -- --
(482,287) (614,867) -- -- -- -- -- --
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
(1,986,595) (2,512,305) (1,522,499) (2,172,783) (661,316) (1,547,694) (89,371) (63,805)
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
3,147,282 28,596,499 (8,149,312) (19,929,631) 5,084,616 5,064,300 (1,513,046) (26,483,377)
-- -- -- -- -- -- 17,349 127,145
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
3,147,282 28,596,499 (8,149,312) (19,929,631) 5,084,616 5,064,300 (1,495,697) (26,356,232)
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
3,183,654 38,732,859 (5,077,054) 15,313,507 9,403,212 37,188,822 (576,273) (12,147,470)
38,732,859 -- 167,566,045 152,252,538 157,686,909 120,498,087 51,186,313 63,333,783
- ------------- ------------ ------------- ------------ ------------- ------------ ------------- ------------
--------------
$41,916,513 $38,732,859 $162,488,991 $167,566,045 $167,090,121 $157,686,909 $50,610,040 $51,186,313
============= ============ ============= ============ ============= ============ ============= ============
$ (199,504) $ -- $ 522,978 $ 1,448,759 $ 147,605 $ 10,951 $ 124,178 $ 81,893
- --------------------------------------------------------------------------------
57
.. The Park Avenue Portfolio
Statements of Changes in Net Assets (Continued)
The Guardian
Baillie Gifford The Guardian
Emerging Markets Fund Investment Quality Bond Fund
------------------------- --------------------------
Six Months Year Ended Six Months Year Ended
Ended December 31, Ended December 31,
June 30, 2004 2003 June 30, 2004 2003
(Unaudited) (Audited) (Unaudited) (Audited)
------------- ------------ ------------- ------------
INCREASE/(DECREASE) IN NET ASSETS
From Operations:
Net investment income................................. $ 134,258 $ 135,000 $ 3,223,836 $ 6,938,090
Net realized gain/(loss) on investments and foreign
currency related transactions........................ 7,248,836 2,248,314 494,239 5,743,920
Net change in unrealized appreciation/
(depreciation) of investments and foreign
currency related transactions........................ (9,751,215) 22,845,347 (3,817,555) (3,814,085)
------------- ------------ ------------- ------------
Net Increase/(Decrease) in Net Assets Resulting
from Operations...................................... (2,368,121) 25,228,661 (99,480) 8,867,925
------------- ------------ ------------- ------------
Dividends and Distributions to Shareholders
from:
Net investment income
Class A.............................................. (116,609) -- (2,593,137) (5,833,151)
Class B.............................................. -- -- (279,771) (526,000)
Class C.............................................. -- -- (176,208) (292,345)
Class K.............................................. (11,893) -- (174,720) (286,594)
Net realized gain on investments and foreign
currency related transactions
Class A.............................................. -- -- (461,219) (4,189,420)
Class B.............................................. -- -- (64,275) (528,307)
Class C.............................................. -- -- (41,400) (318,457)
Class K.............................................. -- -- (37,611) (278,194)
------------- ------------ ------------- ------------
Total Dividends and Distributions to
Shareholders........................................ (128,502) -- (3,828,341) (12,252,468)
------------- ------------ ------------- ------------
From Capital Share Transactions:
Net increase/(decrease) in net assets from capital
share transactions -- Note 8......................... 7,719,244 1,751,043 (18,127,920) (23,611,845)
Redemption fees....................................... 4,836 -- -- --
------------- ------------ ------------- ------------
7,724,080 1,751,043 (18,127,920) (23,611,845)
------------- ------------ ------------- ------------
Net Increase/(Decrease) in Net Assets................. 5,227,457 26,979,704 (22,055,741) (26,996,388)
NET ASSETS:
Beginning of period...................................... 74,292,852 47,313,148 182,935,542 209,931,930
------------- ------------ ------------- ------------
End of period*........................................... $79,520,309 $74,292,852 $160,879,801 $182,935,542
============= ============ ============= ============
* Includes undistributed/(distributions in excess) of net
investment income of.................................... $ 987 $ (4,769) $ -- $ --
The Guardian
Low Duration Bond Fund
------------------------------
Six Months Period from
Ended July 30, 2003+ to
June 30, 2004 December 31, 2003
(Unaudited) (Audited)
------------- -----------------
INCREASE/(DECREASE) IN NET ASSETS
From Operations:
Net investment income................................. $ 285,090 $ 179,570
Net realized gain/(loss) on investments and foreign
currency related transactions........................ (27,413) (14,521)
Net change in unrealized appreciation/
(depreciation) of investments and foreign
currency related transactions........................ (297,759) 91,665
------------- -----------------
Net Increase/(Decrease) in Net Assets Resulting
from Operations...................................... (40,082) 256,714
------------- -----------------
Dividends and Distributions to Shareholders
from:
Net investment income
Class A.............................................. (99,759) (62,296)
Class B.............................................. (58,766) (35,675)
Class C.............................................. (56,960) (35,327)
Class K.............................................. (69,605) (46,272)
Net realized gain on investments and foreign
currency related transactions
Class A.............................................. -- --
Class B.............................................. -- --
Class C.............................................. -- --
Class K.............................................. -- --
------------- -----------------
Total Dividends and Distributions to
Shareholders........................................ (285,090) (179,570)
------------- -----------------
From Capital Share Transactions:
Net increase/(decrease) in net assets from capital
share transactions -- Note 8......................... 1,301,559 31,298,313
Redemption fees....................................... -- --
------------- -----------------
1,301,559 31,298,313
------------- -----------------
Net Increase/(Decrease) in Net Assets................. 976,387 31,375,457
NET ASSETS:
Beginning of period...................................... 31,375,457 --
------------- -----------------
End of period*........................................... $32,351,844 $31,375,457
============= =================
* Includes undistributed/(distributions in excess) of net
investment income of.................................... $ -- $ --
+ Commencementof operations.
- --------------------------------------------------------------------------------
See notes to financial statements.
58
The Guardian The Guardian The Guardian
High Yield Bond Fund Tax-Exempt Fund Cash Management Fund
- ------------------------- -------------------------- ---------------------------
Six Months Year Ended Six Months Year Ended Six Months Year Ended
Ended December 31, Ended December 31, Ended December 31,
June 30, 2004 2003 June 30, 2004 2003 June 30, 2004 2003
(Unaudited) (Audited) (Unaudited) (Audited) (Unaudited) (Audited)
- ------------- ------------ ------------- ------------ ------------- -------------
$ 2,534,182 $ 4,839,189 $ 1,474,610 $ 3,146,743 $ 664,900 $ 2,386,552
1,362,449 2,660,574 592,384 3,094,286 -- --
(3,076,875) 4,375,476 (3,400,006) (1,854,464) -- --
- ------------- ------------ ------------- ------------ ------------- -------------
819,756 11,875,239 (1,333,012) 4,386,565 664,900 2,386,552
- ------------- ------------ ------------- ------------ ------------- -------------
(1,559,130) (3,002,350) (1,337,536) (2,868,086) (631,730) (2,318,884)
(327,746) (628,715) -- -- (14,564) (33,161)
(309,602) (581,123) (137,074) (278,657) (11,319) (19,118)
(337,704) (627,001) -- -- (7,287) (15,389)
-- -- (31,804) (2,827,113) -- --
-- -- -- -- -- --
-- -- (4,183) (372,638) -- --
-- -- -- -- -- --
- ------------- ------------ ------------- ------------ ------------- -------------
(2,534,182) (4,839,189) (1,510,597) (6,346,494) (664,900) (2,386,552)
- ------------- ------------ ------------- ------------ ------------- -------------
1,961,561 6,584,315 213,149 (31,055,047) (63,181,728) (133,887,227)
145 -- -- -- -- --
- ------------- ------------ ------------- ------------ ------------- -------------
1,961,706 6,584,315 213,149 (31,055,047) (63,181,728) (133,887,227)
- ------------- ------------ ------------- ------------ ------------- -------------
247,280 13,620,365 (2,630,460) (33,014,976) (63,181,728) (133,887,227)
71,503,871 57,883,506 90,577,818 123,592,794 560,587,544 694,474,771
- ------------- ------------ ------------- ------------ ------------- -------------
$71,751,151 $71,503,871 $87,947,358 $ 90,577,818 $497,405,816 $ 560,587,544
============= ============ ============= ============ ============= =============
$ -- $ -- $ -- $ -- $ -- $ --
- --------------------------------------------------------------------------------
59
.. The Guardian Investment Quality Bond Fund
Statement of Cash Flows
Six Months Ended June 30, 2004 (Unaudited)
- ------------------------------------------
Cash flows from operating activities:
Net decrease in net assets resulting from operations................... $ (99,480)
Adjustments to reconcile net increase in net assets resulting from
operations to net cash provided by operating activities:
Purchases of long-term securities................................. (162,917,776)
Proceeds from sales of long-term securities....................... 182,508,549
Proceeds from mortgage securities' paydown........................ 10,163,208
Gain on proceeds from mortgage securities' paydown................ 255,769
Premium amortization/discount accretion, net...................... 187,761
Purchases of short-term investments, net.......................... (9,381,244)
Increase in receivables for securities sold....................... (4,904,102)
Increase in receivables........................................... (268,055)
Decrease in other assets.......................................... 2,078
Decrease in accrued expenses...................................... (363)
Decrease in distributions payable................................. (40,926)
Decrease in due to GIS............................................ (19,569)
Net realized gain on investments.................................. (494,239)
Net change in unrealized appreciation of investments.............. 3,817,555
-------------
Net cash provided by operating activities....................... 18,809,166
-------------
Cash flows from financing activities:
Proceeds from fund shares sold..................................... 6,813,744
Payments for fund shares redeemed.................................. (28,910,589)
Cash distributions paid............................................ (524,990)
Proceeds from the financing of dollar roll transactions, net....... 3,788,774
-------------
Net cash used in financing activities........................... (18,833,061)
-------------
Decrease in Cash....................................................... (23,895)
Cash
Beginning of period.................................................... 96,291
-------------
End of period.......................................................... $ 72,396
=============
Supplemental disclosure of cash flow information
Non-cash financing activities not included above:
Reinvestment of distributions...................................... $ 3,303,351
=============
- --------------------------------------------------------------------------------
See notes to financial statements.
60
.. The Park Avenue Portfolio
Notes to Financial Statements
June 30, 2004 (Unaudited)
- --------------------------------------------------------------------------------
61
[_] The Guardian Park Avenue Fund
[_] The Guardian UBS Large Cap Value Fund
[_] The Guardian Park Avenue Small Cap Fund
[_] The Guardian UBS Small Cap Value Fund
[_] The Guardian Asset Allocation Fund
[_] The Guardian S&P 500 Index Fund
[_] The Guardian Baillie Gifford International Growth Fund
[_] The Guardian Baillie Gifford Emerging Markets Fund
[_] The Guardian Investment Quality Bond Fund
[_] The Guardian Low Duration Bond Fund
[_] The Guardian High Yield Bond Fund
[_] The Guardian Tax-Exempt Fund
[_] The Guardian Cash Management Fund
Note 1. Organization and Accounting Policies
The Park Avenue Portfolio (the Portfolio) is a diversified open-end
management investment company registered under the Investment Company Act of
1940, as amended (the 1940 Act), which is organized as a business trust under
the laws of the Commonwealth of Massachusetts. The Portfolio consists of
thirteen series, namely: The Guardian Park Avenue Fund (GPAF); The Guardian UBS
Large Cap Value Fund (GULCVF); The Guardian Park Avenue Small Cap Fund
(GPASCF); The Guardian UBS Small Cap Value Fund (GUSCVF); The Guardian Asset
Allocation Fund (GAAF); The Guardian S&P 500 Index Fund (GSP500F); The Guardian
Baillie Gifford International Growth Fund (formerly The Guardian Baillie
Gifford International Fund) (GBGIF); The Guardian Baillie Gifford Emerging
Markets Fund (GBGEMF); The Guardian Investment Quality Bond Fund (GIQBF); The
Guardian Low Duration Bond Fund (GLDBF); The Guardian High Yield Bond Fund
(GHYBF); The Guardian Tax-Exempt Fund (GTEF); and The Guardian Cash Management
Fund (GCMF). The series are collectively referred to herein as the "Funds".
On February 3, 2003, GULCVF and GUSCVF commenced operations. GULCVF sold
937,500 shares for each of Class A, Class B, Class C and Class K shares to The
Guardian Life Insurance Company of America (Guardian Life) for $9,375,000 each.
GUSCVF sold 437,500 shares for each of Class A, Class B, Class C and Class K
shares to Guardian Life for $4,375,000 each.
On July 30, 2003, GLDBF commenced operations. GLDBF sold 750,000 shares for
each of Class A, Class B, Class C and Class K shares to Guardian Life for
$7,500,000 each.
The Funds offer up to five classes of shares: Class A, Class B, Class C,
Class K and the Institutional Class. Each of the Funds offers Class A shares.
Class A shares are sold with an initial sales load of up to 4.50% (up to 3.00%
for GLDBF and 0.00% for GCMF) and an administrative fee of up to .25% on an
annual basis of the Funds' average daily net assets. A redemption fee of 2% is
imposed on purchases of Class A shares of GBGIF, GBGEMF and GHYBF if redeemed
within 60 days of purchase, except for shares held in omnibus accounts. Class B
shares are offered by all of the Funds, except for GTEF. Class B shares are
sold without an initial sales load but are subject to a 12b-1 fee of .75% and
an administrative fee of .25% on an annual basis of each Fund's Class B average
daily net assets, and a contingent deferred sales load (CDSL) of up to 3%
imposed on certain redemptions. Each of the Funds offers Class C shares. Class
C shares are sold without an initial sales load but are subject to a 12b-1 fee
of .75% and an administrative fee of .25% on an annual basis of each Fund's
Class C average daily net assets, and a CDSL of up to 1% imposed on certain
redemptions. Class K shares are offered by all of the Funds, except for GTEF.
Class K shares are sold without an initial sales load but are subject to a
12b-1 fee of .40% and an administrative fee of .25% on an annual basis of each
Fund's Class K average daily net assets, and a CDSL of up to 1% imposed on
certain redemptions. Institutional Class shares are offered by GPAF, GPASCF,
GAAF, GSP500F, GBGIF, GBGEMF, GIQBF and GHYBF. As of June 30, 2004, none of the
Funds had issued Institutional Class shares. Institutional Class shares are
offered at net asset value, without an initial or a CDSL. All classes of shares
for each Fund represent interests in the same portfolio of investments, have
the same rights and are generally identical in all respects except that each
class bears its separate distribution and certain class expenses, and has
exclusive voting rights with respect to any matter to which a separate vote of
any class is required.
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States (GAAP) requires management
to make estimates and assumptions that affect the reported amounts of assets and
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
liabilities at the date of the financial statements and the reported amounts of
income, gains (losses) and expenses during the reporting period. Actual results
could differ from those estimates.
Significant accounting policies of the Funds are as follows:
Investments
Securities listed on domestic or foreign securities exchanges are valued at
the last sale price on such exchanges, or if no sale occurred, at the mean of
the bid and asked prices. Securities that are traded on the NASDAQ National
Securities Market are valued at the NASDAQ Official Closing Price. In GAAF,
investments in the underlying Funds are valued at the closing net asset value
of each underlying Fund on the day of valuation.
Pursuant to valuation procedures approved by the Board of Trustees, certain
debt securities may be valued each business day by an independent pricing
service (Service). Debt securities for which quoted bid prices are readily
available and representative of the bid side of the market, in the judgment of
the Service, are valued at the bid price, except for GTEF. In GTEF, debt
securities are valued at the mean between the bid and asked prices obtained by
the Service. Other debt securities that are valued by the Service are carried
at fair value as determined by the Service, based on methods which include
consideration of: yields or prices of securities of comparable quality, coupon,
maturity and type; indications as to values from dealers; and general market
conditions.
Futures contracts are valued at the settlement prices established by the
boards of trade or exchanges on which they are traded.
Other securities, including securities for which market quotations are not
readily available (such as certain mortgage backed securities, restricted
securities and foreign securities subject to a "significant event") are valued
at fair value as determined in good faith by or under the direction of the
Funds' Board of Trustees. A "significant event" is an event that will affect
the value of a portfolio security that occurs after the close of trading in the
security's primary trading market or exchange but before the Funds' NAV is
calculated.
Investing outside of the U.S. may involve certain considerations and risks
not typically associated with domestic investments, including the possibility
of political and economic unrest and different levels of governmental
supervision and regulation of foreign securities markets.
Repurchase agreements are carried at cost which approximates market value
(see Note 5). Short-term securities held by the Funds are valued on an
amortized cost basis which approximates market value but does not take into
account unrealized gains and losses. GCMF values its investments based on
amortized cost in accordance with Rule 2a-7 under the 1940 Act.
Investment transactions are recorded on the date of purchase or sale.
Security gains or losses are determined on an identified cost basis. Interest
income, including amortization/accretion of premium/discount, is accrued daily.
Dividend income is recorded on the ex-dividend date.
All income, expenses (other than class-specific expenses) and realized and
unrealized gains or losses are allocated daily to each class of shares based
upon the relative value of shares of each class. Class-specific expenses, which
include any items that are specifically attributed to a particular class, are
charged directly to such class. For the six months ended June 30, 2004,
distribution, administrative and transfer agent fees were the only
class-specific expenses.
Foreign Currency Translation
GPAF, GULCVF, GPASCF, GUSCVF, GAAF, GBGIF, GBGEMF and GHYBF are permitted to
buy international securities that are not U.S. dollar denominated. Their books
and records are maintained in U.S. dollars as follows:
(1) The foreign currency market value of investment securities and other
assets and liabilities stated in foreign currencies are translated into U.S.
dollars at the current rate of exchange.
(2) Security purchases and sales, income and expenses are translated at the
rate of exchange prevailing on the respective dates of such transactions.
The resulting gains and losses are included in the Statement of Operations
as follows:
Gains and losses attributable to foreign currency exchange rates on sales of
securities are recorded for financial statement purposes as net realized gains
and losses on investments. Realized foreign exchange gains and losses, which
result from changes in foreign exchange rates between the date on which a Fund
earns dividends and interest or pays foreign withholding taxes or other
expenses and the date on which U.S. dollar equivalent amounts are actually
received or paid, are included in net realized gains or losses
- --------------------------------------------------------------------------------
62
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
on foreign currency related transactions. Realized foreign exchange gains and
losses which result from changes in foreign exchange rates between the trade
and settlement dates on security and currency transactions are also included in
net realized gains or losses on foreign currency related transactions. Net
currency gains and losses from valuing other assets and liabilities denominated
in foreign currency at the period end exchange rate are reflected in net change
in unrealized appreciation or depreciation from translation of other assets and
liabilities denominated in foreign currencies.
Forward Foreign Currency Contracts
GPAF, GULCVF, GPASCF, GUSCVF, GAAF, GBGIF, GBGEMF and GHYBF may enter into
forward foreign currency contracts in connection with planned purchases or
sales of securities, or to hedge against changes in currency exchange rates
affecting the values of its investments that are denominated in a particular
currency. A forward foreign currency contract is a commitment to purchase or
sell a foreign currency at a future date at a negotiated forward exchange rate.
Risks may arise from the potential inability of a counterparty to meet the
terms of a contract and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar. Fluctuations in the value of forward
foreign currency contracts are recorded for book purposes as unrealized gains
or losses from translation of other assets and liabilities denominated in
foreign currencies by the Funds. When forward contracts are closed, the Funds
will record realized gains or losses equal to the difference between the values
of such forward contracts at the time each was opened and the values at the
time each was closed. Such amounts are recorded in net realized gains or losses
on foreign currency related transactions. The Funds will not enter into a
forward foreign currency contract if such contract would obligate the
applicable Funds to deliver an amount of foreign currency in excess of the
value of the Funds' portfolio securities or other assets denominated in that
currency.
Futures Contracts
GULCVF, GUSCVF, GAAF, GSP500F, GBGIF, GBGEMF, GIQBF, GLDBF, GHYBF and GTEF
may enter into financial futures contracts for the delayed delivery of
securities, currency or contracts based on financial indices at a fixed price
on a future date. In entering into such contracts, the Funds are required to
deposit either in cash or securities an amount equal to a certain percentage of
the contract amount. Subsequent payments are made or received by the Funds each
day, depending on the daily fluctuations in the value of the underlying
security, and are recorded for financial statement purposes as variation
margins by the Funds. The daily changes in the variation margin are recognized
as unrealized gains or losses by the Funds. The Funds' investments in financial
futures contracts are designed to hedge against anticipated future changes in
interest or exchange rates or securities prices. In addition, GAAF may enter
into financial futures contracts for non-hedging purposes. Should interest or
exchange rates or securities prices or prices of futures contracts move
unexpectedly, the Funds may not achieve the anticipated benefits of the
financial futures contracts and may realize a loss.
Dividend Distributions
Dividends from net investment income are declared and accrued daily and are
paid monthly for GIQBF, GLDBF, GHYBF and GTEF, and declared and paid
semi-annually for GPAF, GULCVF, GPASCF, GUSCVF, GAAF, GSP500F, GBGIF and
GBGEMF. Net realized short-term and long-term capital gains for these Funds
will be distributed at least annually. Dividends from GCMF's net investment
income, which includes any net realized capital gains or losses, are declared
and accrued daily and paid monthly on the last business day of each month.
All dividends and distributions are recorded on the ex-dividend date. Such
distributions are determined in conformity with federal income tax regulations.
Differences between the recognition of income on an income tax basis and
recognition of income based on GAAP may cause temporary overdistributions of
net realized gains and net investment income.
Taxes
Each Fund has qualified and intends to remain qualified to be taxed as a
"regulated investment company" under the provisions of the U.S. Internal
Revenue Code (Code), and as such will not be subject to federal income tax on
taxable income (including any realized capital gains) which is distributed in
accordance with the provisions of the Code. Therefore, no federal income tax
provision is required.
Withholding taxes on foreign interest, dividends and capital gains in GBGIF
and GBGEMF have been provided for in accordance with the applicable country's
tax rules and rates.
Expense Reductions
GTEF has entered into an arrangement with its custodian whereby credits
realized as a result of uninvested cash
- --------------------------------------------------------------------------------
63
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
balances were used to reduce a portion of the Fund's expenses. During the
period, GTEF's custodian fees were reduced by $13,207 under this arrangement.
GTEF could have employed the uninvested assets to produce income if GTEF has
not entered into such arrangement.
Reclassification of Capital Accounts
The treatment for financial statement purposes of distributions made during
the year from net investment income and net realized gains may differ from
their ultimate treatment for federal income tax purposes. These differences
primarily are caused by differences in the timing of the recognition of certain
components of income or capital gains, and the recharacterization of foreign
exchange gains or losses to either ordinary income or realized capital gains
for federal income tax purposes. Where such differences are permanent in
nature, they are reclassified in the components of net assets based on their
ultimate characterization for federal income tax purposes. Any such
reclassifications will have no effect on net assets, results of operations, or
net asset value per share of the Funds.
Note 2. Investment Advisory Agreements and Payments to or from Related Parties
The Funds (except GBGIF and GBGEMF) have an investment advisory agreement
with Guardian Investor Services LLC (GIS), an indirect wholly-owned subsidiary
of Guardian Life. Fees for investment advisory are at an annual rate of .50% of
the average daily net assets of each Fund, except for GPASCF, GSP500F, GHYBF
and GLDBF, which pay GIS an annual rate of .75%, .25%, .60% and .45%,
respectively, of their average daily net assets.
GAAF is subject to a contractual annual advisory fee of .65% of its average
daily net assets. However, GIS has agreed to a waiver of .15% of GAAF's annual
advisory fee when GAAF is operated as a "fund of funds" so that GAAF's
effective advisory fee is .50% of its average daily net assets. There are no
duplicative advisory and administrative service fees charged to GAAF on assets
invested in other Guardian Funds. Under an SEC exemptive order, advisory and
administrative fees are paid at the underlying Fund level.
GULCVF pays investment advisory fees to GIS at an annual rate of .83% of its
average daily net assets. GUSCVF pays investment advisory fees to GIS at an
annual rate of 1.00% of its average daily net assets for the first $50 million
and an annual rate of .95% of its average daily net assets in excess of $50
million. GIS has entered into a sub-investment advisory agreement with UBS
Global Asset Management (Americas), Inc. (UBS Global AM). UBS Global AM is
responsible for the day-to-day management of GULCVF and GUSCVF. GIS continually
monitors and evaluates the performance of UBS Global AM. As compensation for
its services, GIS pays UBS Global AM at an annual rate of .43% of GULCVF's
average daily net assets and at an annual rate of .60% for the first $50
million and at an annual rate of .55% in excess of $50 million of GUSCVF's
average daily net assets. Payment of sub-investment advisory fees does not
represent a separate or additional expense to GULCVF or GUSCVF.
For the six months ended June 30, 2004, GIS voluntarily assumed a portion of
the ordinary operating expenses (excluding interest expense associated with
reverse repurchase agreements and securities lending) that exceeded a
percentage of the average daily net assets of the respective Funds, by class,
as follows:
Fund Class A Class B Class C Class K
- ---- ------- ------- ------- -------
GSP500F .53% 1.28% 1.28% 0.93%
GIQBF .85% 1.60% 1.60% 1.25%
GLDBF .80% 1.55% 1.55% 1.20%
GHYBF .85% 1.60% 1.60% 1.25%
GTEF .85% N/A 1.60% N/A
GCMF .85% 1.60% 1.60% 1.25%
For the six months ended June 30, 2004, GIS voluntarily assumed a portion of
certain Funds' expenses based on their respective average daily net assets as
follows:
- --------------------------------------------------
GSP500F*
- --------------------------------------------------
Class A Class B Class C Class K
------- ------- ------- -------
Ordinary Operating
Expenses .19% .19% .19% .16%
12b-1 Fees -- .27% .30% --
---- ---- ---- ----
.19% .46% .49% .16%
==== ==== ==== ====
- --------------------------------------------------
GIQBF*
- --------------------------------------------------
Class A Class B Class C Class K
------- ------- ------- -------
Ordinary Operating
Expenses .14% .14% .14% .07%
12b-1 Fees -- .15% .20% --
---- ---- ---- ----
.14% .29% .34% .07%
==== ==== ==== ====
- --------------------------------------------------------------------------------
64
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
- --------------------------------------------------
GLDBF*
- --------------------------------------------------
Class A Class B Class C Class K
------- ------- ------- -------
Ordinary Operating
Expenses .75% .75% .75% .43%
12b-1 Fees -- .02% .03% --
---- ---- ---- ----
.75% .77% .78% .43%
==== ==== ==== ====
- --------------------------------------------------
GHYBF*
- --------------------------------------------------
Class A Class B Class C Class K
------- ------- ------- -------
Ordinary Operating
Expenses .40% .40% .40% .31%
12b-1 Fees -- .24% .23% --
---- ---- ---- ----
.40% .64% .63% .31%
==== ==== ==== ====
- --------------------------------------------------
GTEF*
- --------------------------------------------------
Class A Class C
------- -------
Ordinary Operating
Expenses .12% .12%
12b-1 Fees -- .24%
---- ----
.12% .36%
==== ====
- --------------------------------------------------
GCMF*
- --------------------------------------------------
Class A Class B Class C
------- ------- -------
Administrative Fees .06% .23% .06%
==== ==== ====
* Annualized.
For the six months ended June 30, 2004, GIS voluntarily assumed $180,317,
$139,942, $110,195, $159,836, $53,767 and $240,089 of the ordinary operating
expenses of GSP500F, GIQBF, GLDBF, GHYBF, GTEF and GCMF, respectively.
The Portfolio, on behalf of GBGIF and GBGEMF, has an investment management
agreement with Guardian Baillie Gifford Limited (GBG), a Scottish corporation
owned by The Guardian Insurance & Annuity Company, Inc. (GIAC), a wholly-owned
subsidiary of Guardian Life and Baillie Gifford Overseas Limited (BG Overseas).
GBG is responsible for the overall investment management of GBGIF and GBGEMF's
portfolios, subject to the supervision of the Portfolio's Board of Trustees.
GBG has entered into a sub-investment management agreement with BG Overseas
pursuant to which BG Overseas is responsible for the day-to-day management of
GBGIF and GBGEMF. GBG continually monitors and evaluates the performance of BG
Overseas. As compensation for its services, GBGIF and GBGEMF pay GBG annual
investment management fees of .80% and 1.00%, respectively, of their average
daily net assets. One half of these fees is payable by GBG to BG Overseas for
its services. Payment of the sub-investment management fee does not represent a
separate or additional expense to GBGIF or GBGEMF.
The Guardian Fund Complex pays trustees who are not "interested persons" (as
defined in the 1940 Act) fees consisting of a $5,000 per meeting fee and an
annual retainer of $30,500, allocated among all funds in the Guardian Fund
Complex based on relative average daily net assets. Board committee members
also receive a fee of $2,000 per committee meeting, which also is allocated
among all funds in the Guardian Fund Complex based on relative average daily
net assets. Additional compensation is paid to the Chairmen of the Nominating
and Governance Committee and the Audit Committee, respectively. GIS pays
compensation to certain trustees who are interested persons. Certain officers
and trustees of the Funds are affiliated with GIS.
GAAF received $942,007 in dividends from other Guardian mutual funds.
Park Avenue Securities LLC (PAS), a wholly-owned subsidiary of GIAC and an
affiliate of GIS distributes the Portfolio's shares as a retail broker-dealer.
For the six months ended June 30, 2004, PAS received $314,980 for brokerage
commissions from the Portfolio.
Administrative Services Agreement
Pursuant to the Administrative Services Agreement adopted by the Funds on
behalf of the Class A, Class B, Class C and Class K shares, each of the Funds,
except GPAF, pays GIS an administrative service fee at an annual rate of .25%
of the Funds' average daily net assets. GPAF pays this fee to GIS at an annual
rate of up to .25% of the average daily net assets for which a "dealer of
record" has been designated. For the six months ended June 30, 2004, GPAF Class
A shares paid an annualized rate of .22% of its average daily net assets
pursuant to the Administrative Services Agreement.
Note 3. Underwriting Agreement and Distribution Plan
The Portfolio has entered into an Underwriting Agreement with GIS pursuant
to which GIS serves as the principal underwriter for shares of the Funds.
- --------------------------------------------------------------------------------
65
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
For the six months ended June 30, 2004, aggregate front-end sales charges
for the sale of Class A shares paid to GIS were as follows:
Fund Commissions Fund Commissions
- ---- ----------- ------ -----------
GPAF $17,697 GBGEMF $ 593
GULCVF 55 GIQBF 2,125
GPASCF 2,428 GLDBF 766
GAAF 2,113 GHYBF 429
GSP500F 3,778 GTEF 1,425
GBGIF 308
Under Distribution Plans adopted by the Portfolio pursuant to Rule 12b-1
under the 1940 Act (the "12b-1 Plans"), each Fund is authorized to pay a
monthly 12b-1 fee for certain classes of shares at an annual rate of .75% of
average daily net assets of the Fund's Class B and Class C shares and .40% of
average daily net assets of the Fund's Class K shares as compensation for
distribution-related services provided to the Class B, Class C and Class K
shares of those Funds.
GIS is entitled to retain any CDSL imposed on certain Class B, Class C and
Class K share redemptions. For the six months ended June 30, 2004, GIS received
CDSL charges on Class B, Class C and Class K as follows:
Fund Class B Class C Class K
- ---- -------- ------- -------
GPAF $101,267 $ 30 $ 18
GULCVF 850 -- 23
GPASCF 7,333 280 39
GUSCVF 1,065 -- --
GAAF 17,257 21 29
GSP500F 5,256 752 23
GBGIF 4,982 -- --
GBGEMF 2,549 -- 9
GIQBF 10,980 645 29
GLDBF 392 -- --
GHYBF 1,514 385 2
GTEF -- 1,103 --
GCMF 12,888 -- 284
Note 4. Investment Transactions
Purchases and proceeds from sales of securities (excluding short-term
securities) for the six months ended June 30, 2004 were as follows:
- ----------------------------------
GPAF GULCVF
- ----------------------------------
Purchases $460,001,595 $13,946,955
Proceeds 567,723,721 12,361,820
- ----------------------------------
GPASCF GUSCVF
- ----------------------------------
Purchases $103,205,532 $13,329,277
Proceeds 103,688,839 12,335,156
- ----------------------------------
GAAF GSP500F
- ----------------------------------
Purchases $ -- $ 2,406,321
Proceeds 9,201,657 242,296
- ----------------------------------
GBGIF GBGEMF
- ----------------------------------
Purchases $ 5,759,169 $38,626,230
Proceeds 7,789,815 30,099,439
- ----------------------------------
GIQBF GLDBF
- ----------------------------------
Purchases $162,850,040 $ 9,412,012
Proceeds 182,508,549 7,738,060
- ----------------------------------
GHYBF GTEF
- ----------------------------------
Purchases $ 33,415,660 $90,086,860
Proceeds 34,931,828 82,291,802
- ----------------------------------
The cost of investments owned at June 30, 2004 for federal income tax
purposes was substantially the same as the cost for financial reporting
purposes for the Funds. The gross unrealized appreciation and depreciation of
investments excluding foreign currency and futures at June 30, 2004 were as
follows:
GPAF GULCVF
---- ------
Appreciation $145,040,779 $18,719,418
(Depreciation) (13,625,255) (806,617)
------------ -----------
Net Unrealized
Appreciation $131,415,524 $17,912,801
============ ===========
GPASCF GUSCVF
------ ------
Appreciation $ 37,415,938 $ 8,282,188
(Depreciation) (6,192,271) (1,053,899)
------------ -----------
Net Unrealized
Appreciation $ 31,223,667 $ 7,228,289
============ ===========
- --------------------------------------------------------------------------------
66
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
GAAF GSP500F
---- -------
Appreciation $ 2,953,045 $ 27,156,226
(Depreciation) (16,247,801) (26,829,330)
------------ ------------
Net Unrealized
Appreciation/(Depreciation) $(13,294,756) $ 326,896
============ ============
GBGIF GBGEMF
----- ------
Appreciation $ 11,796,802 $ 14,503,793
(Depreciation) (540,972) (4,483,945)
------------ ------------
Net Unrealized
Appreciation $ 11,255,830 $ 10,019,848
============ ============
GIQBF GLDBF
----- -----
Appreciation $ 1,651,722 $ 24,557
(Depreciation) (1,754,512) (230,651)
------------ ------------
Net Unrealized
Depreciation $ (102,790) $ (206,094)
============ ============
GHYBF GTEF
----- ----
Appreciation $ 2,584,043 $ 1,819,579
(Depreciation) (949,541) (445,169)
------------ ------------
Net Unrealized
Appreciation $ 1,634,502 $ 1,374,410
============ ============
Note 5. Repurchase Agreements
The collateral for repurchase agreements is either cash or fully negotiable
U.S. government securities. Repurchase agreements are fully collateralized
(including the interest earned thereon) and such collateral is marked-to-market
daily while the agreements remain in force. If the value of the collateral
falls below the value of the repurchase price plus accrued interest, the
applicable Fund will require the seller to deposit additional collateral by the
next business day. If the request for additional collateral is not met, or the
seller defaults, the applicable Fund maintains the right to sell the collateral
and may claim any resulting loss against the seller.
Note 6. Reverse Repurchase Agreements
GAAF, GIQBF, GLDBF and GHYBF may enter into reverse repurchase agreements
with banks or third party broker-dealers to borrow short-term funds. Interest
on the value of reverse repurchase agreements issued and outstanding is based
upon competitive market rates at the time of issuance. At the time GAAF, GIQBF,
GLDBF and GHYBF enter into a reverse repurchase agreement, the Funds establish
and segregate cash, U.S. government securities or liquid, unencumbered
securities that are marked-to-market daily. The value of such segregated assets
must be at least equal to the value of the repurchase obligation (principal
plus accrued interest), as applicable. Reverse repurchase agreements involve
the risk that the buyer of the securities sold by GAAF, GIQBF, GLDBF and GHYBF
may be unable to deliver the securities when the Funds seek to repurchase them.
Note 7. Dollar Roll Transactions
GAAF, GIQBF, GLDBF and GHYBF may enter into dollar roll transactions with
financial institutions to take advantage of opportunities in the mortgage
market. A dollar roll transaction involves a sale by the Fund of securities
that it holds with an agreement by the Fund to repurchase similar securities at
an agreed upon price and date. The securities repurchased will bear the same
interest as those sold, but generally will be collateralized at the time of
delivery by different pools of mortgages with different prepayment histories
than those securities sold. During the period between the sale and repurchase,
the Fund will not be entitled to receive interest and principal payments on the
securities sold. Dollar roll transactions involve the risk that the buyer of
the securities sold by GAAF, GIQBF, GLDBF and GHYBF may be unable to deliver
the securities when the Funds seek to repurchase them.
Note 8. Shares of Beneficial Interest
There is an unlimited number of $0.01 par value shares of beneficial
interest authorized, divided into five classes, designated as Class A, Class B,
Class C, Class K and Institutional Class shares. As of June 30, 2004: (i) GPAF,
GPASCF, GAAF, GSP500F, GBGIF, GBGEMF, GIQBF and GHYBF offered all five classes;
(ii) GTEF offered Class A and Class C shares; and (iii) GULCVF, GUSCVF, GLDBF
and GCMF offered Class A, Class B, Class C and Class K shares. Through June 30,
2004, no Institutional Class shares of the Funds were sold.
- --------------------------------------------------------------------------------
67
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
Transactions in shares of beneficial interest were as follows:
[_] The Guardian Park Avenue
Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- -----------------------------------------------------------------------------------------------------
Shares Amount
- -----------------------------------------------------------------------------------------------------
Class A
Shares sold 663,908 2,688,100 $ 20,231,098 $ 71,466,076
Shares issued in reinvestment
of dividends 208,908 259,185 6,246,373 7,135,022
Shares repurchased (3,928,838) (10,027,084) (118,840,983) (268,695,546)
- ----------------------------------------------------------------------------------------------------
Net decrease (3,056,022) (7,079,799) $ (92,363,512) $(190,094,448)
- ----------------------------------------------------------------------------------------------------
Class B
Shares sold 85,616 236,579 $ 2,488,142 $ 6,081,629
Shares repurchased (678,321) (1,463,661) (19,527,858) (37,424,241)
- ----------------------------------------------------------------------------------------------------
Net decrease (592,705) (1,227,082) $ (17,039,716) $ (31,342,612)
- ----------------------------------------------------------------------------------------------------
Class C
Shares sold 6,908 15,063 $ 198,793 $ 370,651
Shares repurchased (9,529) (29,394) (271,109) (741,440)
- ----------------------------------------------------------------------------------------------------
Net decrease (2,621) (14,331) $ (72,316) $ (370,789)
- ----------------------------------------------------------------------------------------------------
Class K
Shares sold 15,088 7,291 $ 457,904 $ 198,820
Shares issued in reinvestment
of dividends 1,260 756 37,573 20,780
Shares repurchased (784) (310) (23,716) (8,782)
- ----------------------------------------------------------------------------------------------------
Net increase 15,564 7,737 $ 471,761 $ 210,818
- ----------------------------------------------------------------------------------------------------
[_] The Guardian UBS Large
Cap Value Fund
Six Months Period from Six Months Period from
Ended February 3, 2003+ to Ended February 3, 2003+ to
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- -----------------------------------------------------------------------------------------------------
Shares Amount
- -----------------------------------------------------------------------------------------------------
Class A
Shares sold 62,663 1,959,608 $ 809,942 $ 19,415,494
Shares issued in reinvestment
of dividends and
distributions 68,715 42,951 867,186 542,073
Shares repurchased (5,935) (310,031) (76,998) (3,709,638)
- ----------------------------------------------------------------------------------------------------
Net increase 125,443 1,692,528 $ 1,600,130 $ 16,247,929
- ----------------------------------------------------------------------------------------------------
Class B
Shares sold 42,189 1,946,976 $ 547,598 $ 19,255,790
Shares issued in reinvestment
of distributions 60,200 34,101 758,518 432,709
Shares repurchased (33,338) (310,912) (429,150) (3,705,050)
- ----------------------------------------------------------------------------------------------------
Net increase 69,051 1,670,165 $ 876,966 $ 15,983,449
- ----------------------------------------------------------------------------------------------------
Class C
Shares sold 3,866 1,902,265 $ 50,000 $ 18,753,050
Shares issued in reinvestment
of distributions 58,525 33,316 737,415 422,703
Shares repurchased -- (310,518) -- (3,700,000)
- ----------------------------------------------------------------------------------------------------
Net increase 62,391 1,625,063 $ 787,415 $ 15,475,753
- ----------------------------------------------------------------------------------------------------
Class K
Shares sold 17,816 1,905,775 $ 229,576 $ 18,794,718
Shares issued in reinvestment
of dividends and
distributions 63,151 36,999 796,969 468,239
Shares repurchased (2,543) (309,743) (33,011) (3,700,044)
- ----------------------------------------------------------------------------------------------------
Net increase 78,424 1,633,031 $ 993,534 $ 15,562,913
- ----------------------------------------------------------------------------------------------------
+ Commencement of operations.
- --------------------------------------------------------------------------------
68
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
[_] The Guardian Park Avenue Small Cap Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- --------------------------------------------------------------------------------------------------------------------
Shares Amount
- --------------------------------------------------------------------------------------------------------------------
Class A
Shares sold 818,066 1,813,369 $ 16,009,351 $ 28,850,596
Shares issued in reinvestment of distributions 106,953 -- 2,012,855 --
Shares repurchased (782,447) (1,819,099) (15,183,839) (27,392,677)
- --------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) 142,572 (5,730) $ 2,838,367 $ 1,457,919
- --------------------------------------------------------------------------------------------------------------------
Class B
Shares sold 90,500 125,391 $ 1,663,209 $ 1,962,819
Shares issued in reinvestment of distributions 15,791 -- 278,387 --
Shares repurchased (146,715) (203,610) (2,665,819) (2,928,195)
- --------------------------------------------------------------------------------------------------------------------
Net decrease (40,424) (78,219) $ (724,223) $ (965,376)
- --------------------------------------------------------------------------------------------------------------------
Class C
Shares sold 9,216 9,592 $ 169,070 $ 145,248
Shares issued in reinvestment of distributions 6,278 -- 109,991 --
Shares repurchased (5,786) (18,489) (106,569) (322,464)
- --------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) 9,708 (8,897) $ 172,492 $ (177,216)
- --------------------------------------------------------------------------------------------------------------------
Class K
Shares sold 12,990 13,855 $ 248,821 $ 218,871
Shares issued in reinvestment of distributions 7,014 -- 130,031 --
Shares repurchased (1,173) (452) (22,415) (8,060)
- --------------------------------------------------------------------------------------------------------------------
Net increase 18,831 13,403 $ 356,437 $ 210,811
- --------------------------------------------------------------------------------------------------------------------
[_] The Guardian UBS Small Cap Value Fund
Six Months Period from Six Months Period from
Ended February 3, 2003+ to Ended February 3, 2003+ to
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- --------------------------------------------------------------------------------------------------------------------
Shares Amount
- --------------------------------------------------------------------------------------------------------------------
Class A
Shares sold 66,732 932,267 $ 882,736 $ 9,277,024
Shares issued in reinvestment of distributions 41,777 50,375 521,855 648,829
Shares repurchased (5,883) (189,695) (77,473) (2,437,582)
- --------------------------------------------------------------------------------------------------------------------
Net increase 102,626 792,947 $ 1,327,118 $ 7,488,271
- --------------------------------------------------------------------------------------------------------------------
Class B
Shares sold 16,006 921,249 $ 208,969 $ 9,123,598
Shares issued in reinvestment of distributions 39,614 49,148 489,236 628,105
Shares repurchased (7,443) (198,479) (96,158) (2,529,505)
- --------------------------------------------------------------------------------------------------------------------
Net increase 48,177 771,918 $ 602,047 $ 7,222,198
- --------------------------------------------------------------------------------------------------------------------
Class C
Shares sold 2,146 891,366 $ 27,779 $ 8,777,985
Shares issued in reinvestment of distributions 38,360 48,004 473,742 613,488
Shares repurchased -- (192,392) -- (2,454,478)
- --------------------------------------------------------------------------------------------------------------------
Net increase 40,506 746,978 $ 501,521 $ 6,936,995
- --------------------------------------------------------------------------------------------------------------------
Class K
Shares sold 19,120 890,722 $ 247,135 $ 8,771,733
Shares issued in reinvestment of distributions 38,707 47,849 482,286 614,865
Shares repurchased (982) (190,137) (12,825) (2,437,563)
- --------------------------------------------------------------------------------------------------------------------
Net increase 56,845 748,434 $ 716,596 $ 6,949,035
- --------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
- --------------------------------------------------------------------------------
69
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
[_] The Guardian Asset Allocation Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ----------------------------------------------------------------------------------------------------------
Shares Amount
- ----------------------------------------------------------------------------------------------------------
Class A
Shares sold 413,736 1,015,158 $ 4,476,027 $ 9,497,451
Shares issued in reinvestment of dividends 119,550 186,765 1,288,749 1,766,807
Shares repurchased (1,128,777) (3,099,656) (12,170,525) (28,129,262)
- ----------------------------------------------------------------------------------------------------------
Net decrease (595,491) (1,897,733) $ (6,405,749) $(16,865,004)
- ----------------------------------------------------------------------------------------------------------
Class B
Shares sold 67,267 249,644 $ 721,936 $ 2,356,152
Shares issued in reinvestment of dividends 9,323 22,830 100,315 215,963
Shares repurchased (265,207) (619,271) (2,845,205) (5,507,970)
- ----------------------------------------------------------------------------------------------------------
Net decrease (188,617) (346,797) $ (2,022,954) $ (2,935,855)
- ----------------------------------------------------------------------------------------------------------
Class C
Shares sold 10,585 10,197 $ 112,916 $ 95,189
Shares issued in reinvestment of dividends 740 3,114 7,985 29,460
Shares repurchased (8,997) (40,895) (96,254) (367,270)
- ----------------------------------------------------------------------------------------------------------
Net increase/(decrease) 2,328 (27,584) $ 24,647 $ (242,621)
- ----------------------------------------------------------------------------------------------------------
Class K
Shares sold 18,827 20,906 $ 202,392 $ 191,338
Shares issued in reinvestment of dividends 6,371 8,578 68,619 81,064
Shares repurchased (1,515) (15,129) (16,267) (158,553)
- ----------------------------------------------------------------------------------------------------------
Net increase 23,683 14,355 $ 254,744 $ 113,849
- ----------------------------------------------------------------------------------------------------------
[_] The Guardian S&P 500 Index Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ----------------------------------------------------------------------------------------------------------
Shares Amount
- ----------------------------------------------------------------------------------------------------------
Class A
Shares sold 909,491 1,236,886 $ 7,043,460 $ 8,356,406
Shares issued in reinvestment of dividends 8,431 16,294 65,791 119,186
Shares repurchased (502,536) (898,109) (3,892,676) (5,898,251)
- ----------------------------------------------------------------------------------------------------------
Net increase 415,386 355,071 $ 3,216,575 $ 2,577,341
- ----------------------------------------------------------------------------------------------------------
Class B
Shares sold 146,546 335,881 $ 1,134,916 $ 2,276,274
Shares issued in reinvestment of dividends 2,296 6,681 17,886 48,558
Shares repurchased (95,743) (162,230) (743,803) (1,045,467)
- ----------------------------------------------------------------------------------------------------------
Net increase 53,099 180,332 $ 408,999 $ 1,279,365
- ----------------------------------------------------------------------------------------------------------
Class C
Shares sold 141,547 216,791 $ 1,087,190 $ 1,471,332
Shares issued in reinvestment of dividends 1,740 5,016 13,537 36,385
Shares repurchased (59,700) (90,706) (463,429) (626,275)
- ----------------------------------------------------------------------------------------------------------
Net increase 83,587 131,101 $ 637,298 $ 881,442
- ----------------------------------------------------------------------------------------------------------
Class K
Shares sold 106,744 42,861 $ 825,640 $ 288,767
Shares issued in reinvestment of dividends 3,030 7,640 23,637 55,604
Shares repurchased (3,551) (2,533) (27,533) (18,219)
- ----------------------------------------------------------------------------------------------------------
Net increase 106,223 47,968 $ 821,744 $ 326,152
- ----------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
70
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
[_] The Guardian Baillie Gifford International Growth Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ------------------------------------------------------------------------------------------------------------
Shares Amount
- ------------------------------------------------------------------------------------------------------------
Class A
Shares sold 436,297 10,537,973 $ 5,158,929 $ 97,112,928
Shares issued in reinvestment of dividends 7,506 5,562 87,669 55,072
Shares repurchased (550,025) (13,119,742) (6,501,497) (123,103,708)
- ----------------------------------------------------------------------------------------------------------
Net decrease (106,222) (2,576,207) $(1,254,899) $ (25,935,708)
- ----------------------------------------------------------------------------------------------------------
Class B
Shares sold 24,215 37,373 $ 265,051 $ 344,699
Shares repurchased (56,743) (92,815) (608,745) (815,798)
- ----------------------------------------------------------------------------------------------------------
Net decrease (32,528) (55,442) $ (343,694) $ (471,099)
- ----------------------------------------------------------------------------------------------------------
Class C
Shares sold 6,223 1,537 $ 68,506 $ 27,531
Shares repurchased (2,375) (3,434) (25,130) (28,063)
- ----------------------------------------------------------------------------------------------------------
Net increase/(decrease) 3,848 (1,897) $ 43,376 $ (532)
- ----------------------------------------------------------------------------------------------------------
Class K
Shares sold 6,051 3,672 $ 72,308 $ 51,596
Shares repurchased (1,119) (53) (12,788) (489)
- ----------------------------------------------------------------------------------------------------------
Net increase 4,932 3,619 $ 59,520 $ 51,107
- ----------------------------------------------------------------------------------------------------------
[_] The Guardian Baillie Gifford Emerging Markets Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ------------------------------------------------------------------------------------------------------------
Shares Amount
- ------------------------------------------------------------------------------------------------------------
Class A
Shares sold 896,619 2,873,147 $11,997,765 $ 26,734,981
Shares issued in reinvestment of dividends 9,454 -- 113,730 --
Shares repurchased (433,607) (2,744,885) (5,395,458) (25,296,414)
- ----------------------------------------------------------------------------------------------------------
Net increase 472,466 128,262 $ 6,716,037 $ 1,438,567
- ----------------------------------------------------------------------------------------------------------
Class B
Shares sold 57,201 150,218 $ 695,001 $ 1,342,915
Shares repurchased (28,886) (119,951) (342,680) (1,037,985)
- ----------------------------------------------------------------------------------------------------------
Net increase 28,315 30,267 $ 352,321 $ 304,930
- ----------------------------------------------------------------------------------------------------------
Class C
Shares sold 38,659 44,398 $ 455,840 $ 373,501
Shares repurchased (1,448) (46,386) (18,126) (397,512)
- ----------------------------------------------------------------------------------------------------------
Net increase/(decrease) 37,211 (1,988) $ 437,714 $ (24,011)
- ----------------------------------------------------------------------------------------------------------
Class K
Shares sold 16,940 9,274 $ 215,110 $ 86,943
Shares issued in reinvestment of dividends 1,004 -- 11,893 --
Shares repurchased (735) (4,707) (8,995) (55,386)
- ----------------------------------------------------------------------------------------------------------
Net increase 17,209 4,567 $ 218,008 $ 31,557
- ----------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
71
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
[_] The Guardian Investment Quality Bond Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ----------------------------------------------------------------------------------------------------------------------------
Shares Amount
- ----------------------------------------------------------------------------------------------------------------------------
Class A
Shares sold 574,113 3,296,812 $ 5,784,428 $ 34,079,857
Shares issued in reinvestment of dividends and distributions 254,605 802,794 2,548,930 8,219,350
Shares repurchased (2,612,818) (6,470,579) (26,214,852) (66,786,391)
- ----------------------------------------------------------------------------------------------------------------------------
Net decrease (1,784,100) (2,370,973) $(17,881,494) $(24,487,184)
- ----------------------------------------------------------------------------------------------------------------------------
Class B
Shares sold 57,416 350,698 $ 582,465 $ 3,646,670
Shares issued in reinvestment of dividends and distributions 32,798 98,401 328,005 1,005,080
Shares repurchased (184,457) (506,012) (1,845,016) (5,234,314)
- ----------------------------------------------------------------------------------------------------------------------------
Net decrease (94,243) (56,913) $ (934,546) $ (582,564)
- ----------------------------------------------------------------------------------------------------------------------------
Class C
Shares sold 4,897 51,395 $ 49,656 $ 533,062
Shares issued in reinvestment of dividends and distributions 21,413 58,874 214,094 600,919
Shares repurchased (11,058) (45,445) (110,908) (467,508)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 15,252 64,824 $ 152,842 $ 666,473
- ----------------------------------------------------------------------------------------------------------------------------
Class K
Shares sold 37,053 26,977 $ 374,410 $ 279,706
Shares issued in reinvestment of dividends and distributions 21,205 55,230 212,322 564,721
Shares repurchased (5,084) (5,155) (51,454) (52,997)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 53,174 77,052 $ 535,278 $ 791,430
- ----------------------------------------------------------------------------------------------------------------------------
[_] The Guardian Low Duration Bond Fund
Six Months Period from Six Months Period from
Ended July 30, 2003+ to Ended July 30, 2003+ to
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ----------------------------------------------------------------------------------------------------------------------------
Shares Amount
- ----------------------------------------------------------------------------------------------------------------------------
Class A
Shares sold 145,690 844,512 $ 1,462,621 $ 8,444,850
Shares issued in reinvestment of dividends 9,778 6,175 97,839 61,772
Shares repurchased (94,715) (7,066) (946,011) (70,762)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 60,753 843,621 $ 614,449 $ 8,435,860
- ----------------------------------------------------------------------------------------------------------------------------
Class B
Shares sold 35,653 768,810 $ 356,640 $ 7,688,450
Shares issued in reinvestment of dividends 5,866 3,565 58,690 35,669
Shares repurchased (4,739) -- (47,387) --
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 36,780 772,375 $ 367,943 $ 7,724,119
- ----------------------------------------------------------------------------------------------------------------------------
Class C
Shares sold 14,190 755,679 $ 141,755 $ 7,556,708
Shares issued in reinvestment of dividends 5,680 3,529 56,822 35,314
Shares repurchased -- (1) -- (10)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 19,870 759,207 $ 198,577 $ 7,592,012
- ----------------------------------------------------------------------------------------------------------------------------
Class K
Shares sold 5,114 750,005 $ 51,025 $ 7,500,050
Shares issued in reinvestment of dividends 6,957 4,625 69,604 46,272
Shares repurchased (4) -- (39) --
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 12,067 754,630 $ 120,590 $ 7,546,322
- ----------------------------------------------------------------------------------------------------------------------------
+ Commencement of operations.
- --------------------------------------------------------------------------------
72
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
[_] The Guardian High Yield Bond Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ----------------------------------------------------------------------------------------------------------------------------
Shares Amount
- ----------------------------------------------------------------------------------------------------------------------------
Class A
Shares sold 202,869 1,700,337 $ 1,497,905 $ 11,968,468
Shares issued in reinvestment of dividends 209,675 413,138 1,542,800 2,932,687
Shares repurchased (275,662) (1,462,685) (2,037,767) (10,413,890)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 136,882 650,790 $ 1,002,938 $ 4,487,265
- ----------------------------------------------------------------------------------------------------------------------------
Class B
Shares sold 25,999 112,748 $ 190,791 $ 794,370
Shares issued in reinvestment of dividends 41,143 83,788 302,590 593,996
Shares repurchased (51,680) (97,832) (380,235) (688,181)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 15,462 98,704 $ 113,146 $ 700,185
- ----------------------------------------------------------------------------------------------------------------------------
Class C
Shares sold 13,068 63,604 $ 96,620 $ 454,494
Shares issued in reinvestment of dividends 42,042 81,823 309,069 580,074
Shares repurchased (7,489) (47,186) (55,417) (339,768)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 47,621 98,241 $ 350,272 $ 694,800
- ----------------------------------------------------------------------------------------------------------------------------
Class K
Shares sold 26,484 10,354 $ 196,040 $ 75,093
Shares issued in reinvestment of dividends 45,887 88,340 337,702 627,000
Shares repurchased (5,187) (4) (38,392) (28)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase 67,184 98,690 $ 495,350 $ 702,065
- ----------------------------------------------------------------------------------------------------------------------------
[_] The Guardian Tax-Exempt Fund
Six Months Six Months
Ended Year Ended Ended Year Ended
June 30, 2004 December 31, 2003 June 30, 2004 December 31, 2003
(Unaudited) (Audited) (Unaudited) (Audited)
- ----------------------------------------------------------------------------------------------------------------------------
Shares Amount
- ----------------------------------------------------------------------------------------------------------------------------
Class A
Shares sold 90,774 746,166 $ 935,490 $ 7,845,141
Shares issued in reinvestment of dividends and distributions 130,961 531,383 1,334,081 5,543,478
Shares repurchased (197,314) (4,350,043) (2,025,872) (45,456,417)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) 24,421 (3,072,494) $ 243,699 $(32,067,798)
- ----------------------------------------------------------------------------------------------------------------------------
Class C
Shares sold 4,228 49,048 $ 42,800 $ 518,954
Shares issued in reinvestment of dividends and distributions 13,733 62,083 139,865 646,799
Shares repurchased (21,034) (14,571) (213,215) (153,002)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) (3,073) 96,560 $ (30,550) $ 1,012,751
- ----------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
73
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
[_] The Guardian Cash Management Fund
Six Months
Ended Year Ended
June 30, 2004 December 31, 2003
(Unaudited) (Audited)
- --------------------------------------------------------------------------
Shares @ $1 per share
- --------------------------------------------------------------------------
Class A
Shares sold 91,051,373 234,972,577
Shares issued in reinvestment of dividends 629,198 2,306,769
Shares repurchased (151,484,997) (366,117,487)
- --------------------------------------------------------------------------
Net decrease (59,804,426) (128,838,141)
- --------------------------------------------------------------------------
Class B
Shares sold 2,197,500 5,150,561
Shares issued in reinvestment of dividends 13,767 30,959
Shares repurchased (4,780,442) (11,168,541)
- --------------------------------------------------------------------------
Net decrease (2,569,175) (5,987,021)
- --------------------------------------------------------------------------
Class C
Shares sold 132,705 436,733
Shares issued in reinvestment of dividends 11,296 19,006
Shares repurchased (607,661) (700,634)
- --------------------------------------------------------------------------
Net decrease (463,660) (244,895)
- --------------------------------------------------------------------------
Class K
Shares sold 1,437,263 3,114,743
Shares issued in reinvestment of dividends 7,263 15,352
Shares repurchased (1,788,993) (1,947,265)
- --------------------------------------------------------------------------
Net increase/(decrease) (344,467) 1,182,830
- --------------------------------------------------------------------------
- --------------------------------------------------------------------------------
74
Note 9. Line of Credit
A $100,000,000 line of credit available to all of the Funds and other
related Guardian Funds has been established with State Street Bank and Trust
Company and Bank of Montreal. The rate of interest charged on any borrowing is
based upon the prevailing Federal Funds rate at the time of the loan plus .50%
calculated on a 360 day basis per annum. For the six months ended June 30,
2004, none of the Funds borrowed against this line of credit.
The Funds are obligated to pay State Street Bank and Trust Company and Bank
of Montreal a commitment fee computed at a rate of .08% per annum on the
average daily unused portion of the revolving credit.
.. The Park Avenue Portfolio
Notes to Financial Statements (Continued)
June 30, 2004 (Unaudited)
Note 10. Investments in Affiliates/1/
A summary of GAAF transactions in affiliated securities during the six
months ended June 30, 2004 is set forth below:
Balance of Balance of Dividends
Shares Gross Shares Included Net Realized
Held Purchases Gross Held Value in Gains from
December 31, and Sales and June 30, June 30, Dividend Underlying
Name of Issuer 2003 Additions Reductions 2004 2004 Income Funds
-------------- ------------ --------- ---------- ---------- ------------ --------- ------------
Non-Controlled Affiliates
The Guardian Investment Quality Bond
Fund, Class A 2,190,079 -- 925,588 1,264,491 $ 12,467,877 $534,706 $46,786
Majority-Owned Subsidiary
The Guardian S&P 500 Index Fund,
Class A 15,277,311 -- -- 15,277,311 119,621,343 407,301 --
Net Realized
Gain
Name of Issuer on Sales
-------------- ------------
Non-Controlled Affiliates
The Guardian Investment Quality Bond
Fund, Class A $75,349
Majority-Owned Subsidiary
The Guardian S&P 500 Index Fund,
Class A --
/1/Affiliated issuers, as defined in the 1940 Act, include issuers in which the
Fund held 5% or more of the outstanding voting securities. Majority-owned
subsidiaries include issuers on which the Fund held 50% or more of the
outstanding voting securities.
- --------------------------------------------------------------------------------
75
.. The Park Avenue Portfolio
Financial Highlights
Selected data for a share of beneficial interest outstanding throughout the
periods indicated:
Net Realized
& Unrealized
Gain/(Loss) on
Investments Increase/
Net Asset Net and Foreign (Decrease) Dividends
Value, Investment Currency from from Net
Beginning Income/ Related Investment Investment
of Period (Loss) Transactions Operations Income
--------- ---------- -------------- ---------- ----------
The Guardian Park Avenue Fund
Class A:
Six months ended 6/30/2004+................ $30.08 $ 0.09 $ 0.13 $ 0.22 $(0.19)
Year ended 12/31/2003...................... 25.03 0.23 5.00 5.23 (0.18)
Year ended 12/31/2002...................... 32.00 0.17 (7.06) (6.89) (0.08)
Year ended 12/31/2001...................... 41.18 0.12 (9.06) (8.94) (0.03)
Year ended 12/31/2000...................... 59.42 (0.09) (10.57) (10.66) (0.00)++
Year ended 12/31/1999...................... 51.88 0.13 15.04 15.17 (0.08)
Class B:
Six months ended 6/30/2004+................ 28.72 (0.15) 0.23 0.08 --
Year ended 12/31/2003...................... 23.99 (0.16) 4.89 4.73 --
Year ended 12/31/2002...................... 30.88 (0.20) (6.69) (6.89) --
Year ended 12/31/2001...................... 40.08 (0.23) (8.76) (8.99) --
Year ended 12/31/2000...................... 58.57 (0.43) (10.48) (10.91) --
Year ended 12/31/1999...................... 51.59 (0.31) 14.84 14.53 --
Class C:
Six months ended 6/30/2004+................ 28.37 (0.11) 0.15 0.04 --
Year ended 12/31/2003...................... 23.75 (0.16) 4.78 4.62 --
Year ended 12/31/2002...................... 30.64 (0.19) (6.70) (6.89) --
Year ended 12/31/2001...................... 39.85 (0.25) (8.75) (9.00) --
Period from 8/7/2000+++ to 12/31/2000...... 58.01 (0.11) (12.59) (12.70) --
Class K:
Six months ended 6/30/2004+................ 30.00 0.02 0.16 0.18 (0.15)
Year ended 12/31/2003...................... 24.96 0.11 5.02 5.13 (0.09)
Year ended 12/31/2002...................... 31.93 0.05 (7.02) (6.97) --
Period from 5/15/2001+++ to 12/31/2001..... 35.55 0.00 (3.41) (3.41) --
The Guardian UBS Large Cap Value Fund
Class A:
Six months ended 6/30/2004+................ 12.82 0.04 0.34 0.38 (0.05)
Period from 2/3/2003+++ to 12/31/2003...... 10.00 0.08 3.06 3.14 (0.07)
Class B:
Six months ended 6/30/2004+................ 12.80 (0.01) 0.33 0.32 --
Period from 2/3/2003+++ to 12/31/2003...... 10.00 0.00 3.06 3.06 (0.01)
Class C:
Six months ended 6/30/2004+................ 12.80 (0.01) 0.33 0.32 --
Period from 2/3/2003+++ to 12/31/2003...... 10.00 0.00 3.06 3.06 (0.01)
Class K:
Six months ended 6/30/2004+................ 12.83 0.02 0.33 0.35 (0.03)
Period from 2/3/2003+++ to 12/31/2003...... 10.00 0.05 3.07 3.12 (0.04)
The Guardian Park Avenue Small Cap Fund
Class A:
Six months ended 6/30/2004+................ 19.05 (0.07) 0.80 0.73 --
Year ended 12/31/2003...................... 13.30 (0.10) 5.85 5.75 --
Year ended 12/31/2002...................... 15.74 (0.07) (2.37) (2.44) --
Year ended 12/31/2001...................... 16.93 (0.06) (1.13) (1.19) --
Year ended 12/31/2000...................... 17.48 (0.05) (0.37) (0.42) --
Year ended 12/31/1999...................... 12.80 (0.07) 4.75 4.68 --
Class B:
Six months ended 6/30/2004+................ 17.93 (0.15) 0.76 0.61 --
Year ended 12/31/2003...................... 12.64 (0.24) 5.53 5.29 --
Year ended 12/31/2002...................... 15.10 (0.20) (2.26) (2.46) --
Year ended 12/31/2001...................... 16.39 (0.20) (1.09) (1.29) --
Year ended 12/31/2000...................... 17.06 (0.20) (0.34) (0.54) --
Year ended 12/31/1999...................... 12.61 (0.19) 4.64 4.45 --
Class C:
Six months ended 6/30/2004+................ 17.83 (0.16) 0.75 0.59 --
Year ended 12/31/2003...................... 12.59 (0.27) 5.51 5.24 --
Year ended 12/31/2002...................... 15.07 (0.22) (2.26) (2.48) --
Year ended 12/31/2001...................... 16.39 (0.21) (1.11) (1.32) --
Period from 8/7/2000+++ to 12/31/2000...... 19.37 (0.08) (2.77) (2.85) --
Class K:
Six months ended 6/30/2004+................ 18.79 (0.10) 0.80 0.70 --
Year ended 12/31/2003...................... 13.15 (0.14) 5.78 5.64 --
Year ended 12/31/2002...................... 15.62 (0.11) (2.36) (2.47) --
Period from 5/15/2001+++ to 12/31/2001..... 15.71 (0.07) (0.02) (0.09) --
+Unaudited.
++Rounds to less than $0.01.
+++Commencement of operations.
- --------------------------------------------------------------------------------
76
Distributions
from Ratios/Supplemental Data
Net Realized --------------------------------------------------
Gain on Net
Investments Net Asset Net Assets, Investment
and Foreign Value, End of Expenses Income/(Loss) Portfolio
Currency Related End of Total Period to Average to Average Turnover
Transactions Period Return* (000's Omitted) Net Assets Net Assets Rate
- ---------------- --------- ------- --------------- ---------- ------------- ---------
-- $30.11 0.72%(a) $1,042,827 0.90%(b) 0.43%(b) 37%
-- 30.08 20.95 1,133,468 0.89 0.72 74
-- 25.03 (21.56) 1,120,351 0.87 0.51 60
$(0.21) 32.00 (21.75) 1,779,818 0.83 0.31 143
(7.58) 41.18 (18.62) 2,589,059 0.79 (0.16) 108
(7.55) 59.42 30.25 3,334,722 0.77 0.24 74
-- 28.80 0.28 (a) 148,648 1.85(b) (0.52)(b) 37
-- 28.72 19.72 165,274 1.84 (0.24) 74
-- 23.99 (22.31) 167,471 1.83 (0.44) 60
(0.21) 30.88 (22.46) 274,761 1.75 (0.61) 143
(7.58) 40.08 (19.34) 431,206 1.67 (1.03) 108
(7.55) 58.57 29.13 507,764 1.67 (0.66) 74
-- 28.41 0.14 (a) 6,557 2.08(b) (0.75)(b) 37
-- 28.37 19.45 6,622 2.12 (0.52) 74
-- 23.75 (22.49) 5,884 2.07 (0.67) 60
(0.21) 30.64 (22.62) 7,594 1.96 (0.81) 143
(5.46) 39.85 (21.79)(a) 8,222 2.18(b) (1.29)(b) 108
-- 30.03 0.60 (a) 7,619 1.20(b) 0.14 (b) 37
-- 30.00 20.58 7,145 1.20 0.41 74
-- 24.96 (21.83) 5,752 1.21 0.19 60
(0.21) 31.93 (9.63)(a) 7,229 1.22(b) 0.02 (b) 143
(0.45) 12.70 2.98 (a) 23,082 1.49(b) 0.60 (b) 15
(0.25) 12.82 31.48 (a) 21,705 1.59(b) 0.78 (b) 45
(0.45) 12.67 2.54 (a) 22,034 2.24(b) (0.15)(b) 15
(0.25) 12.80 30.65 (a) 21,378 2.33(b) 0.03 (b) 45
(0.45) 12.67 2.54 (a) 21,382 2.21(b) (0.12)(b) 15
(0.25) 12.80 30.65 (a) 20,801 2.33(b) 0.04 (b) 45
(0.45) 12.70 2.79 (a) 21,728 1.75(b) 0.34 (b) 15
(0.25) 12.83 31.22 (a) 20,944 1.88(b) 0.49 (b) 45
(0.24) 19.54 3.89 (a) 166,967 1.21(b) (0.76)(b) 51
-- 19.05 43.23 160,049 1.27 (0.67) 105
-- 13.30 (15.50) 111,803 1.25 (0.45) 108
-- 15.74 (7.03) 139,774 1.28 (0.37) 131
(0.13) 16.93 (2.35) 150,022 1.25 (0.31) 125
-- 17.48 36.56 119,032 1.34 (0.48) 92
(0.24) 18.30 3.47 (a) 22,717 2.12(b) (1.67)(b) 51
-- 17.93 41.85 22,989 2.21 (1.61) 105
-- 12.64 (16.29) 17,189 2.19 (1.40) 108
-- 15.10 (7.87) 20,876 2.18 (1.27) 131
(0.13) 16.39 (3.11) 24,977 2.12 (1.18) 125
-- 17.06 35.29 22,430 2.23 (1.36) 92
(0.24) 18.18 3.37 (a) 8,427 2.25(b) (1.80)(b) 51
-- 17.83 41.62 8,092 2.39 (1.79) 105
-- 12.59 (16.46) 5,824 2.40 (1.60) 108
-- 15.07 (8.05) 6,752 2.34 (1.43) 131
(0.13) 16.39 (14.67)(a) 7,033 2.22(b) (1.12)(b) 125
(0.24) 19.25 3.79 (a) 10,493 1.52(b) (1.06)(b) 51
-- 18.79 42.89 9,893 1.55 (0.96) 105
-- 13.15 (15.81) 6,748 1.55 (0.75) 108
-- 15.62 (0.57)(a) 7,959 1.61(b) (0.77)(b) 131
* Excludes the effect of sales load.
(a)Not annualized.
(b)Annualized.
- --------------------------------------------------------------------------------
77
.. The Park Avenue Portfolio
Financial Highlights (Continued)
Selected data for a share of beneficial interest outstanding throughout the
periods indicated:
Net Realized
& Unrealized
Gain/(Loss) on
Investments Increase/
Net Asset Net and Foreign (Decrease) Dividends
Value, Investment Currency from from Net
Beginning Income/ Related Investment Investment
of Period (Loss) Transactions Operations Income
--------- ---------- -------------- ---------- ----------
The Guardian UBS Small Cap Value Fund
Class A:
Six months ended 6/30/2004+............... $12.71 $(0.04) $ 0.71 $ 0.67 --
Period from 2/3/2003++ to 12/31/2003...... 10.00 (0.01) 3.60 3.59 --
Class B:
Six months ended 6/30/2004+............... 12.61 (0.08) 0.70 0.62 --
Period from 2/3/2003++ to 12/31/2003...... 10.00 (0.09) 3.58 3.49 --
Class C:
Six months ended 6/30/2004+............... 12.61 (0.08) 0.70 0.62 --
Period from 2/3/2003++ to 12/31/2003...... 10.00 (0.10) 3.59 3.49 --
Class K:
Six months ended 6/30/2004+............... 12.68 (0.04) 0.71 0.67 --
Period from 2/3/2003++ to 12/31/2003...... 10.00 (0.03) 3.59 3.56 --
The Guardian Asset Allocation Fund
Class A:
Six months ended 6/30/2004+............... 10.63 0.06 0.26 0.32 $(0.13)
Year ended 12/31/2003..................... 8.45 0.14 2.20 2.34 (0.16)
Year ended 12/31/2002..................... 10.84 0.17 (2.38) (2.21) (0.18)
Year ended 12/31/2001..................... 13.00 0.30 (1.61) (1.31) (0.18)
Year ended 12/31/2000..................... 14.77 0.45 (0.29) 0.16 (0.44)
Year ended 12/31/1999..................... 14.78 0.37 1.47 1.84 (0.37)
Class B:
Six months ended 6/30/2004+............... 10.57 0.01 0.26 0.27 (0.04)
Year ended 12/31/2003..................... 8.41 0.05 2.18 2.23 (0.07)
Year ended 12/31/2002..................... 10.77 0.09 (2.37) (2.28) (0.08)
Year ended 12/31/2001..................... 12.95 0.19 (1.59) (1.40) (0.11)
Year ended 12/31/2000..................... 14.72 0.32 (0.27) 0.05 (0.33)
Year ended 12/31/1999..................... 14.73 0.23 1.47 1.70 (0.23)
Class C:
Six months ended 6/30/2004+............... 10.56 (0.00)+++ 0.26 0.26 (0.01)
Year ended 12/31/2003..................... 8.39 0.02 2.19 2.21 (0.04)
Year ended 12/31/2002..................... 10.77 0.05 (2.38) (2.33) (0.05)
Year ended 12/31/2001..................... 12.94 0.17 (1.64) (1.47) (0.03)
Period from 8/7/2000++ to 12/31/2000...... 14.72 0.15 (0.78) (0.63) (0.23)
Class K:
Six months ended 6/30/2004+............... 10.60 0.04 0.26 0.30 (0.09)
Year ended 12/31/2003..................... 8.43 0.09 2.19 2.28 (0.11)
Year ended 12/31/2002..................... 10.82 0.13 (2.39) (2.26) (0.13)
Period from 5/15/2001++ to 12/31/2001..... 12.06 0.11 (0.68) (0.57) --
The Guardian S&P 500 Index Fund
Class A:
Six months ended 6/30/2004+............... 7.63 0.04 0.20 0.24 (0.04)
Year ended 12/31/2003..................... 6.04 0.08 1.59 1.67 (0.08)
Year ended 12/31/2002..................... 7.90 0.10 (1.86) (1.76) (0.10)
Year ended 12/31/2001..................... 9.07 0.06 (1.17) (1.11) (0.06)
Period from 7/25/2000++ to 12/31/2000..... 10.06 0.03 (0.99) (0.96) (0.03)
Class B:
Six months ended 6/30/2004+............... 7.62 0.01 0.20 0.21 (0.01)
Year ended 12/31/2003..................... 6.03 0.03 1.59 1.62 (0.03)
Year ended 12/31/2002..................... 7.88 0.02 (1.85) (1.83) (0.02)
Year ended 12/31/2001..................... 9.05 0.01 (1.18) (1.17) (0.00)+++
Period from 7/25/2000++ to 12/31/2000..... 10.06 0.00 (1.01) (1.01) --
Class C:
Six months ended 6/30/2004+............... 7.61 0.01 0.20 0.21 (0.01)
Year ended 12/31/2003..................... 6.03 0.03 1.58 1.61 (0.03)
Year ended 12/31/2002..................... 7.88 0.02 (1.85) (1.83) (0.02)
Year ended 12/31/2001..................... 9.05 0.01 (1.17) (1.16) (0.01)
Period from 7/25/2000++ to 12/31/2000..... 10.06 0.00 (1.01) (1.01) --
Class K:
Six months ended 6/30/2004+............... 7.63 0.03 0.19 0.22 (0.02)
Year ended 12/31/2003..................... 6.04 0.06 1.59 1.65 (0.06)
Year ended 12/31/2002..................... 7.90 0.05 (1.86) (1.81) (0.05)
Period from 5/15/2001++ to 12/31/2001..... 8.59 0.02 (0.69) (0.67) (0.02)
+Unaudited.
++Commencement of operations.
+++Rounds to less than $0.01.
- --------------------------------------------------------------------------------
78
Distributions
from Ratios/Supplemental Data
Net Realized ----------------------------------------------------------------------------
Gain on Net
Investments Net Asset Net Assets, Expenses GAAF Investment
and Foreign Value, End of Expenses Waived/ Gross Income/(Loss) Portfolio
Currency Related End of Total Period to Average Subsidized Expense to Average Turnover
Transactions Period Return* (000's Omitted) Net Assets(a) by GIS Ratio(b) Net Assets Rate
- ---------------- --------- ------- --------------- ------------- ---------- -------- ------------- ---------
$(0.63) $12.75 5.39%(c) $ 11,422 2.05%(d) -- -- (0.59)%(d) 31%
(0.88) 12.71 35.76 (c) 10,081 2.17(d) -- -- (0.07)(d) 94
(0.63) 12.60 5.04 (c) 10,333 2.82(d) -- -- (1.35)(d) 31
(0.88) 12.61 34.76 (c) 9,737 2.91(d) -- -- (0.81)(d) 94
(0.63) 12.60 5.04 (c) 9,922 2.82(d) -- -- (1.36)(d) 31
(0.88) 12.61 34.76 (c) 9,422 2.91(d) -- -- (0.81)(d) 94
(0.63) 12.72 5.41 (c) 10,240 2.16(d) -- -- (0.70)(d) 31
(0.88) 12.68 35.46 (c) 9,492 2.35(d) -- -- (0.25)(d) 94
-- 10.82 2.99 (c) 114,615 0.41(d) 0.77%(d) 0.89%(d) 0.94 (d) 0
-- 10.63 27.87 118,988 0.43 0.77 0.97 1.25 0
-- 8.45 (20.64) 110,593 0.42 0.73 0.95 1.60 4
(0.67) 10.84 (10.23) 169,386 0.47 0.63 0.93 2.44 51
(1.49) 13.00 1.00 227,228 0.46 0.60 1.10 3.07 11
(1.48) 14.77 12.99 227,031 0.48 0.58 1.08 2.48 16
-- 10.80 2.52 (c) 31,543 1.22(d) 0.77(d) 1.70(d) 0.13 (d) 0
-- 10.57 26.65 32,863 1.27 0.77 1.81 0.43 0
-- 8.41 (21.31) 29,064 1.25 0.73 1.78 0.78 4
(0.67) 10.77 (10.99) 44,813 1.28 0.63 1.74 1.62 51
(1.49) 12.95 0.26 51,024 1.28 0.60 1.91 2.29 11
(1.48) 14.72 12.09 40,914 1.31 0.58 1.91 1.66 16
-- 10.81 2.47 (c) 8,063 1.43(d) 0.77(d) 1.91(d) (0.06)(d) 0
-- 10.56 26.39 7,857 1.51 0.77 2.06 0.19 0
-- 8.39 (21.70) 6,470 1.50 0.73 2.03 0.58 4
(0.67) 10.77 (11.48) 8,080 1.46 0.63 1.92 1.43 51
(0.92) 12.94 (4.18)(c) 8,544 1.49(d) 0.55(d) 2.07(d) 2.61 (d) 11
-- 10.81 2.84 (c) 8,268 0.67(d) 0.77(d) 1.15(d) 0.70 (d) 0
-- 10.60 27.20 7,859 0.68 0.77 1.22 1.04 0
-- 8.43 (21.05) 6,126 0.70 0.73 1.22 1.39 4
(0.67) 10.82 (4.85)(c) 7,619 0.75(d) 0.72(d) 1.29(d) 1.57 (d) 51
-- 7.83 3.08 (c) 135,979 0.53(d) 0.19(d) -- 1.10 (d) 0
-- 7.63 27.78 129,228 0.53 0.25 -- 1.26 4
-- 6.04 (22.35) 100,129 0.53 0.13 -- 1.03 10
-- 7.90 (12.25) 276,645 0.53 0.10 -- 0.87 1
(0.00)(e) 9.07 (9.53)(c) 167,487 0.53(d) 0.21(d) -- 0.71 (d) 4
-- 7.82 2.78 (c) 12,802 1.28(d) 0.46(d) -- 0.35 (d) 0
-- 7.62 26.94 12,070 1.28 0.61 -- 0.51 4
-- 6.03 (23.22) 8,472 1.28 0.52 -- 0.33 10
-- 7.88 (12.87) 9,705 1.28 0.47 -- 0.09 1
(0.00)(e) 9.05 (10.00)(c) 7,677 1.28(d) 0.47(d) -- (0.04)(d) 4
-- 7.81 2.77 (c) 9,681 1.28(d) 0.49(d) -- 0.35 (d) 0
-- 7.61 26.77 8,796 1.28 0.67 -- 0.51 4
-- 6.03 (23.21) 6,175 1.28 0.57 -- 0.33 10
-- 7.88 (12.87) 7,598 1.28 0.49 -- 0.09 1
(0.00)(e) 9.05 (10.00)(c) 7,296 1.28(d) 0.47(d) -- (0.04)(d) 4
-- 7.83 2.91 (c) 8,629 0.93(d) 0.16(d) -- 0.70 (d) 0
-- 7.63 27.31 7,594 0.93 0.21 -- 0.86 4
-- 6.04 (23.00) 5,722 0.93 0.10 -- 0.68 10
-- 7.90 (7.76)(c) 7,383 0.93(d) 0.15(d) -- 0.47 (d) 1
* Excludes the effect of sales load.
(a)After expenses subsidized by GIS and do not include the expenses of the
underlying Funds.
(b)Amounts include the expenses of the underlying Funds.
(c)Not annualized.
(d)Annualized.
(e)Rounds to less than $0.01.
- --------------------------------------------------------------------------------
79
.. The Park Avenue Portfolio
Financial Highlights (Continued)
Selected data for a share of beneficial interest outstanding throughout the
periods indicated:
Net Realized
& Unrealized
Gain/(Loss) on
Investments Increase/
Net Asset Net and Foreign (Decrease) Dividends
Value, Investment Currency from from Net
Beginning Income/ Related Investment Investment
of Period (Loss) Transactions Operations Income
--------- ---------- -------------- ---------- ----------
The Guardian Baillie Gifford International Growth Fund
Class A:
Six months ended 6/30/2004+..................... $11.43 $ 0.06 $ 0.17 $ 0.23 $(0.03)
Year ended 12/31/2003........................... 8.90 0.18 2.33 2.51 (0.01)
Year ended 12/31/2002........................... 11.09 0.06 (2.25) (2.19) --
Year ended 12/31/2001........................... 14.28 0.01 (3.20) (3.19) --
Year ended 12/31/2000........................... 23.36 (0.06) (5.52) (5.58) --
Year ended 12/31/1999........................... 18.41 0.01 6.68 6.69 --
Class B:
Six months ended 6/30/2004+..................... 10.45 (0.07) 0.23 0.16 --
Year ended 12/31/2003........................... 8.22 (0.16) 2.36 2.20 --
Year ended 12/31/2002........................... 10.38 (0.19) (1.97) (2.16) --
Year ended 12/31/2001........................... 13.54 (0.20) (2.96) (3.16) --
Year ended 12/31/2000........................... 22.61 (0.11) (5.46) (5.57) --
Year ended 12/31/1999........................... 17.97 (0.12) 6.47 6.35 --
Class C:
Six months ended 6/30/2004+..................... 10.47 (0.01) 0.18 0.17 --
Year ended 12/31/2003........................... 8.24 (0.08) 2.28 2.20 --
Year ended 12/31/2002........................... 10.40 (0.09) (2.07) (2.16) --
Year ended 12/31/2001........................... 13.55 (0.12) (3.03) (3.15) --
Period from 8/7/2000++ to 12/31/2000............ 19.19 (0.09) (2.20) (2.29) --
Class K:
Six months ended 6/30/2004+..................... 11.24 0.04 0.19 0.23 --
Year ended 12/31/2003........................... 8.76 0.00 2.45 2.45 --
Year ended 12/31/2002........................... 10.94 (0.00) (2.18) (2.18) --
Period from 5/15/2001++ to 12/31/2001........... 12.96 (0.04) (1.98) (2.02) --
The Guardian Baillie Gifford Emerging Markets Fund
Class A:
Six months ended 6/30/2004+..................... 12.39 0.04 (0.25) (0.21) (0.03)
Year ended 12/31/2003........................... 8.07 0.05 4.27 4.32 --
Year ended 12/31/2002........................... 8.45 0.01 (0.39) (0.38) --
Year ended 12/31/2001........................... 8.31 0.01 0.13 0.14 --
Year ended 12/31/2000........................... 11.13 (0.55) (2.05) (2.60) (0.22)
Year ended 12/31/1999........................... 6.66 (0.07) 4.72 4.65 (0.18)
Class B:
Six months ended 6/30/2004+..................... 11.44 (0.02) (0.23) (0.25) --
Year ended 12/31/2003........................... 7.55 (0.04) 3.93 3.89 --
Year ended 12/31/2002........................... 7.98 (0.10) (0.33) (0.43) --
Year ended 12/31/2001........................... 7.97 (0.10) 0.11 0.01 --
Year ended 12/31/2000........................... 10.65 0.08 (2.76) (2.68) --
Year ended 12/31/1999........................... 6.44 (0.27) 4.48 4.21 --
Class C:
Six months ended 6/30/2004+..................... 11.47 (0.02) (0.23) (0.25) --
Year ended 12/31/2003........................... 7.56 (0.04) 3.95 3.91 --
Year ended 12/31/2002........................... 8.00 (0.09) (0.35) (0.44) --
Year ended 12/31/2001........................... 7.98 (0.09) 0.11 0.02 --
Period from 8/7/2000++ to 12/31/2000............ 9.92 (0.08) (1.86) (1.94) --
Class K:
Six months ended 6/30/2004+..................... 12.19 0.02 (0.25) (0.23) (0.01)
Year ended 12/31/2003........................... 7.97 0.03 4.19 4.22 --
Year ended 12/31/2002........................... 8.36 (0.03) (0.36) (0.39) --
Period from 5/15/2001++ to 12/31/2001........... 8.35 (0.06) 0.07 0.01 --
+Unaudited.
++Commencement of operations.
- --------------------------------------------------------------------------------
80
Distributions
from Ratios/Supplemental Data
Net Realized --------------------------------------------------
Distributions Gain on Net
in Excess Investments and Net Asset Net Assets, Investment
of Net Foreign Value, End of Expenses Income/(Loss) Portfolio
Investment Currency Related Redemption Tax Return End of Total Period to Average to Average Turnover
Income Transactions Fees of Capital Period Return* (000's Omitted) Net Assets Net Assets Rate
- ------------- ---------------- ---------- ---------- --------- ------- --------------- ---------- ------------- ---------
-- -- $0.00(a) -- $11.63 2.04%(b) $ 31,469 2.01%(c) 0.77%(c) 11%
-- -- 0.03 -- 11.43 28.57 32,126 1.93 0.50 44
-- -- -- -- 8.90 (19.75) 47,948 1.62 0.29 45
-- -- -- -- 11.09 (22.34) 80,856 1.53 0.06 63
-- $(3.26) -- $(0.24) 14.28 (23.81) 94,482 1.45 (0.29) 78
$(0.03) (1.71) -- -- 23.36 37.21 148,727 1.44 (0.03) 54
-- -- 0.00(a) -- 10.61 1.53 (b) 6,289 3.13(c) (0.34)(c) 11
-- -- 0.03 -- 10.45 27.13 6,535 3.19 (1.00) 44
-- -- -- -- 8.22 (20.81) 5,598 2.87 (0.98) 45
-- -- -- -- 10.38 (23.34) 8,228 2.62 (1.05) 63
-- (3.26) -- (0.24) 13.54 (24.56) 12,747 2.43 (1.27) 78
-- (1.71) -- -- 22.61 36.16 15,623 2.45 (1.03) 54
-- -- 0.00(a) -- 10.64 1.62 (b) 5,675 3.02(c) (0.22)(c) 11
-- -- 0.03 -- 10.47 27.06 5,546 3.10 (0.93) 44
-- -- -- -- 8.24 (20.77) 4,381 2.85 (0.99) 45
-- -- -- -- 10.40 (23.25) 5,530 2.60 (1.04) 63
-- (3.11) -- (0.24) 13.55 (11.72)(b) 7,208 2.51(c) (1.52)(c) 78
-- -- 0.00(a) -- 11.47 2.05 (b) 7,178 2.11(c) 0.69 (c) 11
-- -- 0.03 -- 11.24 28.31 6,979 2.13 0.04 44
-- -- -- -- 8.76 (19.93) 5,407 1.86 0.01 45
-- -- -- -- 10.94 (15.59)(b) 6,753 1.84(c) (0.60)(c) 63
-- -- 0.00(a) -- 12.15 (1.70)(b) 48,478 1.84(c) 0.62 (c) 39
-- -- -- -- 12.39 53.53 43,561 2.10 0.57 74
-- -- -- -- 8.07 (4.50) 27,356 2.10 (0.04) 81
-- -- -- -- 8.45 1.68 19,777 2.39 (0.19) 101
-- -- -- -- 8.31 (23.88) 18,439 2.18 (0.86) 101
-- -- -- -- 11.13 69.91 32,940 2.43 (1.07) 96
-- -- 0.00(a) -- 11.19 (2.19)(b) 9,504 2.85(c) (0.40)(c) 39
-- -- -- -- 11.44 51.52 9,389 3.20 (0.54) 74
-- -- -- -- 7.55 (5.39) 5,965 3.21 (1.16) 81
-- -- -- -- 7.98 0.13 6,023 3.51 (1.28) 101
-- -- -- -- 7.97 (25.16) 6,105 3.79 (2.54) 101
-- -- -- -- 10.65 65.37 2,320 5.07 (3.70) 96
-- -- 0.00(a) -- 11.22 (2.18)(b) 9,754 2.82(c) (0.38)(c) 39
-- -- -- -- 11.47 51.72 9,540 3.17 (0.51) 74
-- -- -- -- 7.56 (5.50) 6,306 3.12 (1.08) 81
-- -- -- -- 8.00 0.25 6,486 3.34 (1.12) 101
-- -- -- -- 7.98 (19.56)(b) 6,466 3.49(c) (2.31)(c) 101
-- -- 0.00(a) -- 11.95 (1.87)(b) 11,784 2.15(c) 0.29 (c) 39
-- -- -- -- 12.19 52.95 11,803 2.38 0.29 74
-- -- -- -- 7.97 (4.67) 7,685 2.36 (0.32) 81
-- -- -- -- 8.36 0.12 (b) 8,020 2.63(c) (1.23)(c) 101
* Excludes the effect of sales load.
(a)Rounds to less than $ 0.01.
(b)Not annualized.
(c)Annualized.
- --------------------------------------------------------------------------------
81
.. The Park Avenue Portfolio
Financial Highlights (Continued)
Selected data for a share of beneficial interest outstanding throughout the
periods indicated:
Net Realized
& Unrealized
Gain/(Loss) on
Investments Increase/
Net Asset and Foreign (Decrease) Dividends
Value, Net Currency from from Net
Beginning Investment Related Investment Investment
of Period Income Transactions Operations Income
--------- ---------- -------------- ---------- ----------
The Guardian Investment Quality Bond Fund
Class A:
Six months ended 6/30/2004+............... $10.09 $0.20 $(0.19) $ 0.01 $(0.20)
Year ended 12/31/2003..................... 10.28 0.35 0.11 0.46 (0.35)
Year ended 12/31/2002..................... 9.86 0.44 0.45 0.89 (0.44)
Year ended 12/31/2001..................... 9.61 0.50 0.30 0.80 (0.50)
Year ended 12/31/2000..................... 9.33 0.60 0.28 0.88 (0.60)
Year ended 12/31/1999..................... 9.99 0.53 (0.63) (0.10) (0.53)
Class B:
Six months ended 6/30/2004+............... 10.09 0.16 (0.19) (0.03) (0.16)
Year ended 12/31/2003..................... 10.28 0.27 0.11 0.38 (0.27)
Year ended 12/31/2002..................... 9.86 0.37 0.45 0.82 (0.37)
Year ended 12/31/2001..................... 9.60 0.43 0.31 0.74 (0.43)
Period from 8/7/2000++ to 12/31/2000...... 9.41 0.22 0.19 0.41 (0.22)
Class C:
Six months ended 6/30/2004+............... 10.09 0.16 (0.19) (0.03) (0.16)
Year ended 12/31/2003..................... 10.28 0.27 0.11 0.38 (0.27)
Year ended 12/31/2002..................... 9.86 0.37 0.45 0.82 (0.37)
Year ended 12/31/2001..................... 9.60 0.43 0.31 0.74 (0.43)
Period from 8/7/2000++ to 12/31/2000...... 9.41 0.22 0.19 0.41 (0.22)
Class K:
Six months ended 6/30/2004+............... 10.10 0.18 (0.19) (0.01) (0.18)
Year ended 12/31/2003..................... 10.29 0.31 0.11 0.42 (0.31)
Year ended 12/31/2002..................... 9.87 0.40 0.45 0.85 (0.40)
Period from 5/15/2001++ to 12/31/2001..... 9.68 0.28 0.24 0.52 (0.28)
The Guardian Low Duration Bond Fund
Class A:
Six months ended 6/30/2004+............... 10.02 0.11 (0.09) 0.02 (0.11)
Period from 7/30/2003++ to 12/31/2003..... 10.00 0.08 0.02 0.10 (0.08)
Class B:
Six months ended 6/30/2004+............... 10.02 0.07 (0.09) (0.02) (0.07)
Period from 7/30/2003++ to 12/31/2003..... 10.00 0.05 0.02 0.07 (0.05)
Class C:
Six months ended 6/30/2004+............... 10.02 0.07 (0.09) (0.02) (0.07)
Period from 7/30/2003++ to 12/31/2003..... 10.00 0.05 0.02 0.07 (0.05)
Class K:
Six months ended 6/30/2004+............... 10.02 0.09 (0.09) 0.00 (0.09)
Period from 7/30/2003++ to 12/31/2003..... 10.00 0.06 0.02 0.08 (0.06)
The Guardian High Yield Bond Fund
Class A:
Six months ended 6/30/2004+............... 7.45 0.27 (0.18) 0.09 (0.27)
Year ended 12/31/2003..................... 6.69 0.54 0.76 1.30 (0.54)
Year ended 12/31/2002..................... 7.19 0.55 (0.50) 0.05 (0.55)
Year ended 12/31/2001..................... 7.66 0.69 (0.47) 0.22 (0.69)
Year ended 12/31/2000..................... 8.98 0.77 (1.32) (0.55) (0.77)
Year ended 12/31/1999..................... 9.84 0.78 (0.84) (0.06) (0.78)
Class B:
Six months ended 6/30/2004+............... 7.45 0.24 (0.18) 0.06 (0.24)
Year ended 12/31/2003..................... 6.69 0.48 0.76 1.24 (0.48)
Year ended 12/31/2002..................... 7.18 0.50 (0.49) 0.01 (0.50)
Year ended 12/31/2001..................... 7.66 0.64 (0.48) 0.16 (0.64)
Year ended 12/31/2000..................... 8.97 0.68 (1.31) (0.63) (0.68)
Year ended 12/31/1999..................... 9.83 0.67 (0.84) (0.17) (0.67)
Class C:
Six months ended 6/30/2004+............... 7.45 0.24 (0.18) 0.06 (0.24)
Year ended 12/31/2003..................... 6.69 0.48 0.76 1.24 (0.48)
Year ended 12/31/2002..................... 7.18 0.50 (0.49) 0.01 (0.50)
Year ended 12/31/2001..................... 7.65 0.64 (0.47) 0.17 (0.64)
Period from 8/7/2000++ to 12/31/2000...... 8.47 0.28 (0.82) (0.54) (0.28)
Class K:
Six months ended 6/30/2004+............... 7.45 0.26 (0.17) 0.09 (0.26)
Year ended 12/31/2003..................... 6.69 0.51 0.76 1.27 (0.51)
Year ended 12/31/2002..................... 7.19 0.53 (0.50) 0.03 (0.53)
Period from 5/15/2001++ to 12/31/2001..... 7.68 0.39 (0.49) (0.10) (0.39)
+Unaudited.
++Commencement of operations.
- --------------------------------------------------------------------------------
82
Distributions
from Ratios/Supplemental Data
Net Realized ------------------------------------------------------------------------------------
Gain on Expenses Net
Investments Net Asset Net Assets, (excluding Investment
and Foreign Value, End of Expenses interest expense) Expenses Income Portfolio
Currency Related End of Total Period to Average to average Subsidized to Average Turnover
Transactions Period Return* (000's Omitted) Net Assets(a)(b) Net Assets(a) by GIS Net Assets Rate
- ---------------- --------- ------- --------------- ---------------- ----------------- ---------- ---------- ---------
$(0.04) $ 9.86 0.01%(c) $122,642 0.85%(d) 0.85%(d) 0.14%(d) 3.90%(d) 97%
(0.30) 10.09 4.53 143,536 0.85 0.85 0.11 3.40 257
(0.03) 10.28 9.25 170,658 0.85 0.85 0.08 4.37 275
(0.05) 9.86 8.55 144,900 0.86 0.85 0.09 5.11 414
-- 9.61 9.81 124,805 0.85 0.85 0.09 6.41 344
(0.03) 9.33 (1.02) 139,661 0.81 0.80 0.13 5.49 271
(0.04) 9.86 (0.36)(c) 17,021 1.60(d) 1.60(d) 0.29(d) 3.15(d) 97
(0.30) 10.09 3.75 18,374 1.60 1.60 0.27 2.65 257
(0.03) 10.28 8.43 19,308 1.60 1.60 0.27 3.58 275
(0.05) 9.86 7.86 13,036 1.61 1.60 0.31 4.31 414
-- 9.60 4.40 (c) 8,493 1.60(d) 1.60(d) 0.34(d) 5.78(d) 344
(0.04) 9.86 (0.36)(c) 11,099 1.60(d) 1.60(d) 0.34(d) 3.15(d) 97
(0.30) 10.09 3.75 11,206 1.60 1.60 0.35 2.66 257
(0.03) 10.28 8.44 10,753 1.60 1.60 0.36 3.64 275
(0.05) 9.86 7.85 9,090 1.61 1.60 0.36 4.36 414
-- 9.60 4.39 (c) 8,356 1.60(d) 1.60(d) 0.34(d) 5.78(d) 344
(0.04) 9.87 (0.19)(c) 10,119 1.25(d) 1.25(d) 0.07(d) 3.50(d) 97
(0.30) 10.10 4.11 9,820 1.25 1.25 0.05 3.00 257
(0.03) 10.29 8.81 9,213 1.25 1.25 0.03 4.00 275
(0.05) 9.87 5.43 (c) 8,436 1.26(d) 1.25(d) 0.08(d) 4.48(d) 414
-- 9.93 0.21 (c) 8,976 0.80(d) -- 0.75(d) 2.24(d) 24
-- 10.02 0.99 (c) 8,457 0.80(d) -- 1.20(d) 1.87(d) 97
-- 9.93 (0.16)(c) 8,032 1.55(d) -- 0.77(d) 1.49(d) 24
-- 10.02 0.67 (c) 7,743 1.55(d) -- 1.20(d) 1.11(d) 97
-- 9.93 (0.16)(c) 7,733 1.55(d) -- 0.78(d) 1.49(d) 24
-- 10.02 0.67 (c) 7,611 1.55(d) -- 1.21(d) 1.11(d) 97
-- 9.93 0.01 (c) 7,610 1.20(d) -- 0.43(d) 1.84(d) 24
-- 10.02 0.82 (c) 7,565 1.20(d) -- 0.97(d) 1.46(d) 97
-- 7.27 1.23 (c) 42,575 0.85(d) -- 0.40(d) 7.40(d) 49
-- 7.45 20.11 42,589 0.85 -- 0.42 7.59 153
-- 6.69 0.96 33,894 0.85 -- 0.45 8.17 69
-- 7.19 2.87 33,797 0.85 -- 0.47 9.21 141
-- 7.66 (6.53) 38,646 0.85 -- 0.38 9.03 163
(0.02) 8.98 (0.63) 54,178 0.75 -- 0.40 8.34 152
-- 7.27 0.86 (c) 9,892 1.60(d) -- 0.64(d) 6.64(d) 49
-- 7.45 19.22 10,018 1.60 -- 0.72 6.85 153
-- 6.69 0.35 8,336 1.60 -- 0.77 7.42 69
-- 7.18 1.96 8,182 1.60 -- 0.78 8.42 141
-- 7.66 (7.32) 7,567 1.74 -- 0.77 8.37 163
(0.02) 8.97 (1.78) 3,184 1.87 -- 1.00 7.22 152
-- 7.27 0.86 (c) 9,441 1.60(d) -- 0.63(d) 6.65(d) 49
-- 7.45 19.22 9,316 1.60 -- 0.71 6.85 153
-- 6.69 0.35 7,710 1.60 -- 0.77 7.42 69
-- 7.18 2.09 7,657 1.60 -- 0.71 8.43 141
-- 7.65 (6.42)(c) 7,491 1.60(d) -- 0.63(d) 8.74(d) 163
-- 7.28 1.17 (c) 9,843 1.25(d) -- 0.31(d) 7.00(d) 49
-- 7.45 19.63 9,581 1.25 -- 0.33 7.20 153
-- 6.69 0.55 7,944 1.25 -- 0.35 7.77 69
-- 7.19 (1.31)(c) 7,893 1.25(d) -- 0.41(d) 8.36(d) 141
* Excludes the effect of sales load.
(a)After expenses subsidized by GIS.
(b)Expense ratio includes interest expense associated with reverse repurchase
agreements.
(c)Not annualized.
(d)Annualized.
- --------------------------------------------------------------------------------
83
.. The Park Avenue Portfolio
Financial Highlights (Continued)
Selected data for a share of beneficial interest outstanding throughout the
periods indicated:
Net Realized
& Unrealized
Gain/(Loss) on
Investments Increase/
Net Asset and Foreign (Decrease) Dividends
Value, Net Currency from from Net
Beginning Investment Related Investment Investment
of Period Income Transactions Operations Income
--------- ---------- -------------- ---------- ----------
The Guardian Tax-Exempt Fund
Class A:
Six months ended 6/30/2004+............... $10.31 $ 0.17 $(0.32) $(0.15) $ (0.17)
Year ended 12/31/2003..................... 10.51 0.37 0.18 0.55 (0.37)
Year ended 12/31/2002..................... 10.09 0.40 0.61 1.01 (0.40)
Year ended 12/31/2001..................... 10.10 0.41 0.06 0.47 (0.41)
Year ended 12/31/2000..................... 9.40 0.43 0.70 1.13 (0.43)
Year ended 12/31/1999..................... 10.13 0.40 (0.73) (0.33) (0.40)
Class C:
Six months ended 6/30/2004+............... 10.31 0.13 (0.32) (0.19) (0.13)
Year ended 12/31/2003..................... 10.51 0.29 0.18 0.47 (0.29)
Year ended 12/31/2002..................... 10.09 0.32 0.61 0.93 (0.32)
Year ended 12/31/2001..................... 10.10 0.34 0.06 0.40 (0.34)
Period from 8/7/2000++ to 12/31/2000...... 9.77 0.14 0.33 0.47 (0.14)
The Guardian Cash Management Fund
Class A:
Six months ended 6/30/2004+............... 1.000 0.001 -- -- (0.001)
Year ended 12/31/2003..................... 1.000 0.004 -- -- (0.004)
Year ended 12/31/2002..................... 1.000 0.009 -- -- (0.009)
Year ended 12/31/2001..................... 1.000 0.032 -- -- (0.032)
Year ended 12/31/2000..................... 1.000 0.056 -- -- (0.056)
Year ended 12/31/1999..................... 1.000 0.044 -- -- (0.044)
Class B:
Six months ended 6/30/2004+............... 1.000 0.001 -- -- (0.001)
Year ended 12/31/2003..................... 1.000 0.002 -- -- (0.002)
Year ended 12/31/2002..................... 1.000 0.002 -- -- (0.002)
Year ended 12/31/2001..................... 1.000 0.025 -- -- (0.025)
Year ended 12/31/2000..................... 1.000 0.052 -- -- (0.052)
Year ended 12/31/1999..................... 1.000 0.044 -- -- (0.044)
Class C:
Six months ended 6/30/2004+............... 1.000 0.001 -- -- (0.001)
Year ended 12/31/2003..................... 1.000 0.002 -- -- (0.002)
Year ended 12/31/2002..................... 1.000 0.002 -- -- (0.002)
Year ended 12/31/2001..................... 1.000 0.025 -- -- (0.025)
Period from 8/7/2000++ to 12/31/2000...... 1.000 0.020 -- -- (0.020)
Class K:
Six months ended 6/30/2004+............... 1.000 0.001 -- -- (0.001)
Year ended 12/31/2003..................... 1.000 0.002 -- -- (0.002)
Year ended 12/31/2002..................... 1.000 0.005 -- -- (0.005)
Period from 5/15/2001++ to 12/31/2001..... 1.000 0.013 -- -- (0.013)
+Unaudited.
++Commencement of operations.
- --------------------------------------------------------------------------------
84
Distributions
from Ratios/Supplemental Data
Net Realized ----------------------------------------------------------------
Gain on Net
Investments Net Asset Net Assets, Investment
and Foreign Value, End of Expenses Expenses Income Portfolio
Currency Related End of Total Period to Average Subsidized to Average Turnover
Transactions Period Return* (000's Omitted) Net Assets(a) by GIS Net Assets Rate
- ---------------- --------- ------- --------------- ------------- ---------- ---------- ---------
$(0.00)(b) $ 9.99 (1.39)%(c) $ 77,756 0.88%(d)(e) 0.12%(e) 3.40%(e) 94%
(0.38) 10.31 5.34 80,025 0.89(d) 0.09 3.52 68
(0.19) 10.51 10.20 113,852 0.87(d) 0.06 3.85 99
(0.07) 10.09 4.78 107,676 0.91(d) 0.09 4.03 181
-- 10.10 12.29 97,185 0.88(d) 0.07 4.43 124
(0.00)(b) 9.40 (3.29) 97,908 0.86(d) 0.08 4.11 144
(0.00)(b) 9.99 (1.76)(c) 10,191 1.63(d)(e) 0.36(e) 2.65(e) 94
(0.38) 10.31 4.54 10,553 1.64(d) 0.36 2.77 68
(0.19) 10.51 9.37 9,741 1.62(d) 0.37 3.11 99
(0.07) 10.09 3.99 8,783 1.66(d) 0.37 3.28 181
-- 10.10 4.87 (c) 8,391 1.65(d)(e) 0.31(e) 3.62(e) 124
-- 1.000 0.13 (c) 469,517 0.85(e) 0.06(e) 0.26(e) --
-- 1.000 0.37 529,321 0.85 0.05 0.38 --
-- 1.000 0.95 658,159 0.85 0.02 0.94 --
-- 1.000 3.27 606,045 0.85 0.04 3.13 --
-- 1.000 5.69 462,183 0.85 0.07 5.57 --
-- 1.000 4.45 390,106 0.85 0.09 4.41 --
-- 1.000 0.13 (c) 9,929 1.60(e) 0.23(e) 0.26(e) --
-- 1.000 0.21 12,498 1.60 0.16 0.21 --
-- 1.000 0.23 18,485 1.60 0.37 0.22 --
-- 1.000 2.48 15,685 1.60 0.12 2.37 --
-- 1.000 5.34 11,860 1.14 0.63 5.25 --
-- 1.000 4.45 13,782 0.85 0.93 4.41 --
-- 1.000 0.13 (c) 8,622 1.60(e) 0.06(e) 0.26(e) --
-- 1.000 0.21 9,086 1.60 0.05 0.21 --
-- 1.000 0.22 9,330 1.60 0.25 0.22 --
-- 1.000 2.48 8,492 1.60 0.04 2.47 --
-- 1.000 2.03 (c) 8,193 1.60(e) 0.13(e) 5.06(e) --
-- 1.000 0.08 (c) 9,338 1.25(e) -- 0.16 --
-- 1.000 0.18 9,682 1.25 -- 0.18 --
-- 1.000 0.55 8,500 1.25 -- 0.54 --
-- 1.000 1.26 (c) 8,125 1.25(e) 0.01(e) 1.99(e) --
* Excludes the effect of sales load.
(a)After expenses subsidized by GIS.
(b)Rounds to less than $0.01.
(c)Not annualized.
(d)Before offset of custody credits. Including the custody credits in Class A,
the expense ratio is 0.80% for 1999 and 0.85% for 2000, 2001, 2002, 2003 and
6/30/2004; in Class C the expense ratio is 1.60% for 2000, 2001, 2002, 2003
and 6/30/2004.
(e)Annualized.
- --------------------------------------------------------------------------------
85
.. Trustees
Dennis J. Manning, CLU, ChFC -- Chair
Frank J. Fabozzi, Ph.D.
Arthur V. Ferrara, CLU
Leo R. Futia, CLU
William W. Hewitt, Jr
Sidney I. Lirtzman, Ph.D.
Carl W. Schafer
Robert G. Smith, Ph.D.
.. Officers
Thomas G. Sorell -- President
Joseph A. Caruso
Howard W. Chin
Robert J. Crimmins, Jr.
Richard A. Cumiskey
Richard A. Goldman
Alexander M. Grant, Jr.
Edward H. Hocknell
Jonathan C. Jankus
Stewart M. Johnson
Peter J. Liebst
R. Robin Menzies
Nydia Morrison
John B. Murphy
Karen L. Olvany
Frank L. Pepe
Richard T. Potter, Jr.
Robert A. Reale
Donald P. Sullivan, Jr.
Mathew P. Ziehl
Shares of the Funds are not deposits or obligations of, or guaranteed or
endorsed by, any bank or depository institution, nor are they federally insured
by the Federal Deposit Insurance Corporation, The Federal Reserve Board, the
National Credit Union Association or any other agency. They involve investment
risk, including possible loss of principal amount invested.
This report is authorized for distribution to the public only when accompanied
or preceded by a current prospectus for the funds which comprise The Park
Avenue Portfolio.
.. Investment Adviser & Distributor
Guardian Investor Services LLC
7 Hanover Square
New York, New York 10004
.. Custodian of Assets
State Street Bank and Trust Company
Custody Division
1776 Heritage Drive
North Quincy, Massachusetts 02171
.. Shareholder Servicing Agent, Transfer Agent & Dividend Paying Agent for
State Street Bank and Trust Company
Boston Financial Data Services
Post Office Box 219611
Kansas City, Missouri 64121-9611
.. Independent Auditors
Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116
.. Proxy Voting Policies and Procedures
A description of the policies and procedures that the Funds use to determine
how to vote proxies relating to portfolio securities, as well as information
regarding how each Fund voted proxies relating to portfolio securities during
the 12-month period ended June 30, 2004, is available without charge upon
request by calling 800-221-3253 or by logging on to www.guardianinvestor.com
or the Securities and Exchange Commission's website at www.sec.gov.
[LOGO] Guardian
Guardian Investor Services LLC
7 Hanover Square
New York, New York 10004
PRSRT STANDARD
U.S. POSTAGE PAID
[LOGO] Guardian BOWNE FULFILLMENT SOLUTIONS
Guardian Investor Services LLC
7 Hanover Square
New York, NY 10004
EB 011566 (6/04)
ITEM 2. CODE OF ETHICS.
Not applicable for semiannual reports.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
Not applicable for semiannual reports.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable for semiannual reports.
ITEM 5. AUDIT COMMITTE 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 PURCHASES.
Not applicable.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 10. CONTROLS AND PROCEDURES.
a) The registrant's certifying officers have evaluated the registrant's
disclosure controls and procedures within 90 days of this filing and have
concluded that the registrant's disclosure controls and procedures were
effective, as of that date, in ensuring that information required to be
disclosed by the registrant in this Form N-CSR was recorded, processed,
summarized, and reported timely.
(b) The registrant's certifying officers are aware of no changes in the
registrant's internal control over financial reporting that occurred during the
registrant's most recent fiscal half-year that has materially affected, or is
reasonably likely to materially affect, the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Separate certifications by the registrant's certifying officers, pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(a)
under the Investment Company Act of 1940, are attached.
(a)(3) Not applicable.
(b) A certification by the registrant's certifying officers, pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(b)
under the Investment Company Act of 1940, is attached.
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.
The Park Avenue Portfolio
By: /s/ Thomas G. Sorell
----------------------------
Thomas G. Sorell
President of
The Park Avenue Portfolio
Date: August 27, 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/ Thomas G. Sorell
----------------------------
Thomas G. Sorell
President of
The Park Avenue Portfolio
Date: August 27, 2004
By: /s/ Frank L. Pepe
----------------------------
Frank L. Pepe
Vice President and Treasurer of
The Park Avenue Portfolio
Date: August 27, 2004