N-Q 1 franknq.htm UNITED STATES

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549



FORM N-Q


QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

 MANAGEMENT INVESTMENT COMPANY


Investment Company Act file number: 811-21532


Frank Funds

(Exact Name of Registrant as Specified in Charter)


6 Stacy Court, Parsippany, NJ  07054

(Address of Principal Executive Offices)  (Zip Code)


Alfred C. Frank, Frank Capital Partners LLC

6 Stacy Court, Parsippany, NJ  07054

(Name and Address of Agent for Service)


With copy to:

JoAnn M. Strasser, Thompson Hine LLP

312 Walnut Street, 14th Floor, Cincinnati, Ohio  45202


Registrant’s Telephone Number, including Area Code:  973-887-7698


Date of fiscal year end: June 30


Date of reporting period: September 30, 2008


Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (ss.ss. 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5).  The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number.  Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, and 450 Fifth Street, NW, Washington, DC 20549-0609.  The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507.


ITEM 1. SCHEDULE OF INVESTMENTS.


     

 

 

Frank Value Fund

 

 
  

Schedule of Investments

  

 

 

September 30, 2008 (Unaudited)

 

 
     

Shares

  

Value

 
     

COMMON STOCKS - 94.68%

  
     

Cable & Other Pay Television Services - 3.70%

  

960

 

Liberty Global, Inc. Class-A *

$         29,088

 

168

 

Liberty Global, Inc. Series-C *

            4,719

 
   

33,807

 

Commercial Banks, NEC - 1.27%

  

567

 

Citigroup, Inc.

11,629

 
     

Communications Equipment - 1.64%

  

2,240

 

Lojack Corp. *

14,986

 
     

Computer Communications Equipment - 5.35%

  

2,168

 

Cisco Systems, Inc. *

48,910

 
     

Concrete, Gypsum & Plaster Products - 2.92%

  

1,045

 

USG Corp. *

26,752

 
     

Electric Services - 1.32%

  

660

 

Mirant Corp. *

12,071

 
     

Electronic Computers - 3.02%

  

1,678

 

Dell, Inc. *

27,653

 
     

Federal & Federally-Sponsored Credit Agencies - 0.27%

  

1,444

 

Federal Home Loan Mortgage Corp. *

2,469

 
     

Finance Services - 8.83%

  

1,205

 

American Express Co.

42,693

 

1,143

 

Americredit Corp. *

11,579

 

1,723

 

Broadridge Financial Solutions, Inc.

          26,517

 
   

80,789

 

Hospital & Medical Service Plans - 2.62%

  

665

 

Wellcare Health Plans, Inc. *

23,940

 
     

Household Furniture - 1.79%

  

1,394

 

Tempur-Pedic International, Inc.

16,393

 
     

Men's & Boy's Furnishings, Work Clothing & Allied Garments - 2.60%

  

829

 

Cintas Corp.

23,801

 
     

Miscellaneous Furniture & Fixtures - 2.80%

  

1,694

 

Knoll, Inc.

25,613

 
     

Motorcycles, Bicycles & Parts - 2.71%

  

664

 

Harley Davidson, Inc.

24,767

 
     

Perfumes, Cosmetics & Other Toliet Preparations - 2.48%

  

2091

 

Bare Escentuals, Inc. *

22,729

 
     

Personal Credit Institutions - 0.44%

  

1,634

 

First Marblehead Corp. *

4,069

 
     

Pharmaceutical Preparations - 6.62%

  

1,007

 

NBTY, Inc. *

29,727

 

3,468

 

Prestige Brands Holdings, Inc. *

          30,796

 
   

60,523

 

Retail-Drug Store and Proprietary Stores - 4.55%

  

2,649

 

Petmed Express, Inc. *

41,589

 
     

Retail-Eating Places - 3.26%

  

1,878

 

Nathans Famous, Inc. *

29,841

 
     

Retail-Home Furniture, Furnishings & Equipment Stores - 3.44%

  

1003

 

Bed Bath & Beyond, Inc. *

31,504

 
     

Retail-Miscellaneous Shopping Goods Stores - 3.11%

  

1,263

 

Staples, Inc.

28,418

 
     

Retail-Radio, TV & Consumer Electronics Stores - 3.08%

  

751

 

Best Buy Co., Inc.

28,163

 
     

Services-Advertising Agencies - 2.51%

  

2,241

 

Valueclick, Inc. *

22,926

 
     

Services-Business Services - 4.64%

  

1,897

 

Ebay, Inc. *

42,455

 
     

Services-Computer Programming - 3.43%

  

1,085

 

Computer Programs & Systems, Inc.

31,411

 
     

Services - Consumer Credit Reporting - 2.71%

  

728

 

Moody's, Inc.

24,752

 
     

Services-Help Supply Services - 3.61%

  

2,044

 

Trueblue, Inc. *

33,031

 
     

Services- Mailing, Reproduction - 3.00%

  

1,589

 

American Reprographics Co. *

27,410

 
     

Telegraph & Other Message Communications - 3.04%

  

1,191

 

J2 Global Communications, Inc. *

27,810

 
     

Water Transportation - 3.93%

  

7,119

 

Rand Logistics, Inc. *

          35,951

 
     

TOTAL FOR COMMON STOCKS (Cost $1,063,268) - 94.68%

$       866,162

 
     

WARRANTS - 0.13%

  

7,129

 

Rand Logistics, Inc. *

$          1,212

 
     

TOTAL FOR WARRANTS (Cost $13,709) - 0.13%

$          1,212

 
     

SHORT TERM INVESTMENTS - 5.28%

  

48,322

 

First American Treasury Obligations Fund Class Y 0.64% ** (Cost $48,322)

          48,322

 
     

TOTAL INVESTMENTS (Cost $1,125,299) - 100.10%

$       915,696

 
     

LIABILITIES IN EXCESS OF OTHER ASSETS - (0.10%)

            (886)

 
     

NET ASSETS - 100.00%

$       914,810

 
     

* Non-income producing securities during the period.

  

** Variable rate security; the coupon rate shown represents the yield at September 30, 2008.

  
     

NOTES TO FINANCIAL STATEMENTS

  

Frank Value Fund

  

1. SECURITY TRANSACTIONS

  

At September 30, 2008, the net unrealized depreciation on investments, based on cost for federal income tax purposes of $1,125,299 amounted to $209,603, which consisted of aggregate gross unrealized appreciation of $43,387 and aggregate gross unrealized depreciation of $252,991.

 
 
 
     

2. NEW ACCOUNTING PRONOUNCEMENTS

  

The  Fund  adopted Financial Accounting Standards Board Statement of Financial Accounting Standards  No. 157, Fair Value Measurements ("FAS 157"), effective January 1, 2008. In  accordance with  FAS 157,  fair value is defined as the price  that  the Fund would receive to sell an asset or pay to transfer a liability  in  an orderly transaction between market participants at the measurement date.

FAS 157 also establishes a framework for measuring fair value, and a three-level  hierarchy  for fair value measurements based upon the transparency  of  inputs  to  the valuation of an asset or liability.  Inputs may be observable  or  unobservable  and refer broadly to the assumptions that market participants  would  use  in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability  based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund's own assumptions about the assumptions that market participants would use in pricing the asset or liability developed based  on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant  to  the  overall valuation. The three-tier hierarchy of inputs is summarized below:

 
 
 
 
 
 
 
 
 
 
 
 
 
 
     

Level 1 - quoted prices in active markets for identical investments

  
     

Level 2 - other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

  
  
     

Level 3 - significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

  
  
     

The  inputs  or methodology used for valuing securities are not necessarily an indication of  the risk associated with investing in those securities. Money market securities are valued using amortized cost, in accordance with rules under  the  Investment Company Act of 1940. Generally, amortized cost approximates the current fair value of a security, but since the value is not obtained  from a quoted price in an active market, such securities are reflected as Level 2.

  
  
  
  
  
     

The following table summarizes the valuation of the Fund's investments by the above fair value hierarchy levels as of September 30, 2008:

  
  
     
   

INVESTMENT

OTHER

   

IN

FINANCIAL

   

SECURITIES

INSTRUMENTS*

======================================================================================================

Level 1 - Quoted prices

 

 $          915,696

 $                           -   

Level 2 - Other significant observable inputs

                      -   

                              -   

Level 3 - Significant unobservable inputs

                      -   

                            -

Total                                      

$          915,696

 $                           -   

     

*Other  financial  instruments are derivative instruments not reflected in the Portfolio  of Investments, such as futures forwards and swap contracts, which  are valued at the unrealized appreciation/depreciation on the instrument.

  
  
  
     





     

 

 

Leigh Baldwin Total Return Fund

 

 
  

Schedule of Investments

  

 

 

September 30, 2008

 

 
     

Shares

  

Value

 
     

COMMON STOCKS - 56.07%

  
     

Electronic & Other Electrical Equipment - 4.16%

  

200

 

General Electric Co.

$                5,100

 
     

Grain Mill Products - 4.57%

  

100

 

Kellogg Co.

                  5,610

 
     

Petroleum Refining - 12.66%

  

200

 

Exxon Mobil Corp.

                15,532

 
     

Pharmaceutical Preparations - 2.68%

  

100

 

Sanofi-Aventis

                  3,287

 
     

Rubber & Plastics Footwear - 10.91%

  

200

 

Nike, Inc.

                13,380

 
     

Services-Computer Integrated Systems Design - 2.82%

  

200

 

Yahoo, Inc. *

                  3,460

 
     

Services-Computer Programming, Data Processing, Etc. - 3.26%

  

10

 

Google, Inc. *

                  4,005

 
     

Services-Miscellaneous Amusement & Recreation - 15.01%

  

600

 

Walt Disney Co. *

                18,414

 
     

TOTAL FOR COMMON STOCKS (Cost $70,507) - 56.07%

68,788

 
     

EXCHANGE TRADED FUNDS - 7.43%

  

1,000

 

Aberdeen Asia Pacific Fund

$                5,020

 

300

 

Powershares Financial Preferred

                  4,092

 
     

TOTAL FOR EXCHANGE TRADED FUNDS (Cost $10,372) - 7.43%

9,112

 
     

PUT OPTIONS - 3.39%

  

100

 

General Electric Co. January 2010 10 Put

$                   450

 

100

 

General Electric Co. January 2010 20 Put

287

 

100

 

Kellogg Co. January 2010 50 Put

300

 

200

 

Exxon Mobil Corp. January 2010 65 Put

940

 

100

 

Sanofi-Aventis January 2010 25 Put

190

 

200

 

Nike, Inc. January 2010 50 Put

700

 

600

 

Walt Disney Co. January 2010 25 Put

                  1,290

 
     

TOTAL FOR PUT OPTIONS (Cost $3,928) - 3.39%

4,157

 
     

SHORT TERM INVESTMENTS - 43.52%

  

53,393

 

Fidelity Governmental Fund 57 1.96% **

                53,393

 
     

TOTAL FOR SHORT TERM INVESTMENTS (Cost $53,393) - 43.52%

53,393

 
     

TOTAL INVESTMENTS (Cost $134,272) - 110.41%

135,450

 
     

LIABILITIES IN EXCESS OF OTHER ASSETS - (10.41)%

(12,767)

 
     

NET ASSETS - 100.00%

$             122,683

 
     

* Non-income producing securities during the period.

  

** Variable rate security; the coupon rate shown represents the yield at September 30, 2008.

  
     
     

Leigh Baldwin Total Return Fund

Schedule of Call Options Written

September 30, 2008

     
  

CALL OPTIONS WRITTEN

  
     
  

Underlying Security

Shares Subject

 
  

Expiration Date/Exercise Price

to Call

Value

  

General Electric Co.

  
  

 October 2008 Call @ 28.00

                    200

 $                    60

     
  

Kellogg Co.

  
  

 October 2008 Call @ 55.00

                    100

 $                   184

     
  

Exxon Mobil Corp.

  
  

 October 2008 Call @ 80.00

                    200

 $                   364

     
  

Sanofi-Aventis

  
  

 October 2008 Call @ 35.00

                    100

 $                    40

     
  

Nike, Inc.

  
  

 October 2008 Call @ 65.00

                    200

 $                   760

     
  

Yahoo, Inc.

  
  

 October 2008 Call @ 20.00

                    200

 $                    80

     
  

Walt Disney Co.

  
  

 October 2008 Call @ 30.00

                    200

 $                   280

  

 October 2008 Call @ 32.50

                    200

 $                    80

  

 October 2008 Call @ 35.00

                    200

 $                    20

    

 $                   380

     
  

Total (Premiums Received $1,900)

 

 $                1,868

     

Leigh Baldwin Total Return Fund

Notes to Financials Statements

September 30, 2008

     

1. SECURITY TRANSACTIONS

  

At September 30, 2008, the net unrealized depreciation on investments, based on cost for federal income tax purposes of 135,450 amounted to $2,717, which consisted of aggregate gross unrealized appreciation of $1,687 and aggregate gross unrealized depreciation of $4,405.

     

2. NEW ACCOUNTING PRONOUNCEMENTS

  

The  Fund  adopted Financial Accounting Standards Board Statement of Financial Accounting Standards  No. 157, Fair Value Measurements ("FAS 157"), effective January 1, 2008. In  accordance with  FAS 157,  fair value is defined as the price  that  the Fund would receive to sell an asset or pay to transfer a liability  in  an orderly transaction between market participants at the measurement date.

FAS 157 also establishes a framework for measuring fair value, and a three-level  hierarchy  for fair value measurements based upon the transparency  of  inputs  to  the valuation of an asset or liability.  Inputs may be observable  or  unobservable  and refer broadly to the assumptions that market participants  would  use  in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability  based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund's own assumptions about the assumptions that market participants would use in pricing the asset or liability developed based  on the best information available in the circumstances. Each investment is assigned a level based upon the

observability of the inputs which are significant  to  the  overall valuation. The three-tier hierarchy of inputs is summarized below:

     

Level 1 - quoted prices in active markets for identical investments

  
     

Level 2 - other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

     

Level 3 - significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

     

The  inputs  or methodology used for valuing securities are not necessarily an indication of  the risk associated with investing in those securities. Money market securities are valued using amortized cost, in accordance with rules under  the  Investment Company Act of 1940. Generally, amortized cost approximates the current fair value of a security, but since the value is not obtained  from a quoted price in an active market, such securities are reflected as Level 2.

     

The following table summarizes the valuation of the Fund's investments by the above fair value hierarchy levels as of September 30, 2008:

     
   

INVESTMENT

OTHER

   

IN

FINANCIAL

   

SECURITIES

INSTRUMENTS*

======================================================================================================

Level 1 - Quoted prices

 $                  131,293

 $                              -   

Level 2 - Other significant observable inputs

                         4,157

                                 -   

Level 3 - Significant unobservable inputs

                           -   

                              -   

Total                                      

 $                  135,450

 $                              -   

     

*Other  financial  instruments are derivative instruments not reflected in the Portfolio  of Investments, such as futures forwards and swap contracts, which  are valued at the unrealized appreciation/depreciation on the instrument.

 
 
 
     
     
     






ITEM 2. CONTROLS AND PROCEDURES.


(a)


EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Registrant's filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant's management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant's management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Within 90 days prior to the filing date of this Quarterly Schedule of Portfolio Holdings on Form N-Q, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant's management, including the Registrant's principal executive officer and the Registrant's principal financial officer, of the effectiveness of the design and operation of the Registrant's disclosure controls and procedures. Based on such evaluation, the Registrant's principal executive officer and principal financial officer concluded that the Registrant's disclosure controls and procedures are effective.

(b)


CHANGES IN INTERNAL CONTROLS. There have been no significant changes in the Registrant's internal controls or in other factors that could significantly affect the internal controls subsequent to the date of their evaluation in connection with the preparation of this Quarterly Schedule of Portfolio Holdings on Form N-Q.


ITEM 3. EXHIBITS.


Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.


SIGNATURES


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.



Frank Funds


By /s/Alfred C. Frank, President

 Alfred C. Frank

 President


Date: November 25, 2008


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/Alfred C. Frank, President

Alfred C. Frank

President


Date November 25, 2008


By /s/Brian J. Frank

Brian J. Frank

Treasurer


Date November 25, 2008