N-Q 1 franknq201011.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)


312 East 22nd Street, #2B, New York, NY  10010

 (Address of Principal Executive Offices)  (Zip Code)


Brian J. 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, 2010


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, 2010 (Unaudited)

 
      

Shares

   

Value

 
      

COMMON STOCKS - 93.95%

    
      

Apparel & Other Finished Prods of Fabrics & Similar Material - 3.08%

   

7,230

True Religion Apparel, Inc. *

  

$       154,288

 
      

Communications Services, NEC - 2.44%

    

4,928

Neustar, Inc. Class-A *

  

122,510

 
      

Computer Communications Equipment - 4.13%

    

9,459

Cisco Systems, Inc. *

  

207,152

 
      

Electronic Computers - 1.96%

    

7,594

Dell, Inc. *

  

98,494

 
      

Finance Services - 2.56%

    

3,050

American Express Co.

  

128,191

 
      

Hospital & Medical Service Plans - 9.15%

    

3,664

Humana, Inc. *

  

184,079

 

4,085

Wellcare Health Plans, Inc. *

  

118,302

 

2,765

Wellpoint, Inc. *

  

         156,610

 
    

458,991

 

Pharmaceutical Preparations - 10.24%

    

20,757

Pfizer, Inc.

  

356,398

 

15,858

Prestige Brands Holdings, Inc. *

  

         156,836

 
    

513,234

 

Retail-Apparel & Accessory Stores - 1.94%

    

4,184

Aeropostale, Inc.*

  

97,278

 
      

Retail-Computer & Computer Software - 1.97%

    

5,018

Gamestop Corp. Class-A *

  

98,905

 
      

Retail-Drug Store and Proprietary Stores - 4.05%

    

11,599

Petmed Express, Inc.

  

202,982

 
      

Retail-Radio, TV & Consumer Electronics Stores - 2.46%

    

3,019

Best Buy Co., Inc.

  

123,266

 
      

Retail-Shoe Stores - 3.13%

    

5,474

DSW, Inc. Class-A *

  

157,104

 
      

Semiconductors & Related Devices - 4.47%

    

11,665

Intel Corp.

  

223,968

 
      

Services-Advertising Agencies - 2.72%

    

10,418

Valueclick, Inc. *

  

136,267

 
      

Services-Business Services - 9.31%

    

10,225

Ebay, Inc. *

  

249,490

 

12,289

Western Union Co.

  

         217,147

 
    

466,637

 

Services-Computer Programming, Date Processing, Etc. - 5.15%

    

491

Google, Inc. Class-A *

  

258,163

 
      

Services-Consumer Credit Reporting - 2.45%

    

1,660

Dun & Bradstreet Corp.

  

123,072

 
      

Services-Engineering, Accounting, Research, Management - 2.98%

    

4,524

Forrester Research, Inc. *

  

149,654

 
      

Services-Mailing, Reproduction - 1.51%

    

9,617

American Reprographics Co. *

  

75,493

 
      

Services-Management Consulting - 2.69%

    

4,280

Corporate Executive Board Co.

  

135,077

 
      

Services-Personal Services - 6.18%

    

11,935

H&R Block, Inc.

  

154,558

 

4,974

Weight Watchers International, Inc.

  

         155,139

 
    

309,697

 

Services-Prepackaged Software - 5.01%

    

5,438

CA, Inc.

  

114,850

 

5,569

Microsoft Corp.

  

         136,385

 
    

251,235

 

Telegraph & Other Message Communications - 4.37%

    

9,221

J2 Global Communications, Inc. *

  

         219,368

 
      

TOTAL FOR COMMON STOCKS (Cost $4,536,479) - 93.95%

  

$     4,711,026

 
      

SHORT TERM INVESTMENTS - 4.92%

    

246,822

Fidelity Institutional Money Market Portfolio

  

         246,822

 
 

    0.30% ** (Cost $246,822)

    
      

TOTAL INVESTMENTS (Cost $4,783,301) - 98.87%

  

$     4,957,848

 
      

LIABILITIES IN EXCESS OF OTHER ASSETS - 1.13%

  

          56,434

 
      

NET ASSETS - 100.00%

  

$     5,014,282

 
      

* Non-income producing securities during the period.

    

** Variable rate security; the coupon rate shown represents the yield at September 30, 2010.

   
      

NOTES TO FINANCIAL STATEMENTS

    

Frank Value Fund

    

1. SECURITY TRANSACTIONS

    

At September 30, 2010, the net unrealized appreciation on investments, based on cost for federal income tax purposes of $4,536,479 amounted to $174,547 which consisted of aggregate gross unrealized appreciation of $363,077 and aggregate gross unrealized

depreciation of $188,530.

    
      

2. SECURITY VALUATION

    

Equity securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  Securities that are      
traded on any stock exchange or on the NASDAQ over-the-counter market are generally valued by the pricing service at the last quoted sale price.  Lacking a last sale price, an equity security is generally valued by the pricing service at its last bid price.  When market quotations are not readily available, when the adviser determines that the market quotation or the price provided by the pricing service does not accurately reflect the current market value, or when restricted or illiquid securities are being valued, such securities are valued as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review by the Board of Trustees.

      

Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional-size trading units of debt securities without regard to sale or bid prices.  If the adviser decides that a price provided by the pricing service does not accurately reflect the fair market value of the securities, when prices are not readily available from a pricing service, or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review of the Board of Trustees.  Short term investments in fixed income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value.

      

In accordance with the Trust’s good faith pricing guidelines, the adviser is required to consider all appropriate factors relevant to the value of securities for which it has determined other pricing sources are not available or reliable as described above.  No single standard for determining fair value exists since fair value depends upon the circumstances of each individual case.  As a general principle, the current fair value of an issue of securities being valued by the adviser would appear to be the amount which the owner might reasonably expect to receive for them upon their current sale.  Methods which are in accord with this principle may, for example, be based on (i) a multiple of earnings; (ii) a discount from market of a similar freely traded security (including a derivative security or a basket of securities traded on other markets, exchanges or among dealers); or (iii) yield to maturity with respect to debt issues, or a combination of these and other methods.

      

In accordance with FAS 157, fair value is defined as the price that the Funds 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.  The three-tier hierarchy of inputs is summarized below:

      

Valuation Inputs of Assets

Level 1

Level 2

Level 3

Total

Common Stock

$4,711,026

              $0

              $0

$4,711,026

Exchange Traded Funds

              $0

              $0

              $0

              $0

Convertible Bonds

              $0

              $0

              $0

              $0

Cash Equivalents

$246,822

              $0

              $0

$246,822

Total

 

$4,957,848

       $0

       $0

$4,957,848

   

 

 

 

Leigh Baldwin Total Return Fund

Schedule of Investments

September 30, 2010 (Unaudited)

      

Shares

    

Value

      

COMMON STOCKS - 87.63%

    
      

Biological Products (No Diagnostic Substances) - 0.99%

    

1,000

Gilead Sciences, Inc. *

   

$            35,610

      

Canned, Frozen & Preserved Fruit, Veg & Food Specialties - 4.47%

    

3,400

Heinz Co.

   

161,058

      

Cigarettes - 5.44%

    

3,500

Philip Morris International, Inc.

   

196,070

      

Crude Petroluem & Natural Gas - 4.63%

    

4,600

Petroleo Brasileiro S.A.

   

166,842

      

Farm Machinery & Equipment - 0.87%

    

5,000

Arts-Way Manufacturing Co.

   

31,500

      

Finance Services - 1.05%

    

5,000

Oneida Financial Corp.

   

37,750

      

Grain Mill Products - 8.26%

    

4,000

General Mills, Inc.

   

146,160

3,000

Kellogg Co.

   

            151,530

     

297,690

Guided Missiles & Space Vehicles & Parts - 4.94%

    

2,500

Lockheed Martin Corp.

   

178,200

      

Malt Beverages - 4.32%

    

3,300

Molson Coors Brewing, Co.

   

155,826

      

National Commercial Banks - 0.83%

    

5,000

Wilber Corp.

   

29,800

      

Petroleum Refining - 6.26%

    

2,600

Exxon Mobil Corp.

   

            160,654

2,000

Suncor Energy, Inc.

   

              65,100

     

225,754

Pharmaceutical Preparations - 4.51%

    

6,000

Bristol Myers Squibb Co.

   

162,660

      

Pumps & Pumping Equipment - 3.90%

    

3,000

ITT Corp.

   

140,490

      

Retail-Drug Stores & Proprietary Stores - 5.11%

    

5,500

Walgreen Co.

   

184,250

      

Security Brokers, Dealers & Flotation Companies - 3.86%

    

10,000

Schwab Corp.

   

139,000

      

Semiconductors & Related Devices - 4.79%

    

9,000

Intel Corp.

   

172,800

      

Services-Engineering, Accounting, Research, Management - 4.57%

    

6,000

Paychex, Inc.

   

164,940

      

Services-Miscellaneous Amusement & Recreation - 4.13%

    

4,500

Walt Disney Co.

   

            148,950

      

Services-Motion Picture & Video Tape Production - 1.77%

    

2,000

DreamWorks Animation SKG, Inc. *

   

63,820

      

Services-Prepackaged Software - 4.42%

    

6,500

Microsoft Corp.

   

159,185

      

Soap, Detergent, Cleaning Preparations, Perfumes, Cosmetics - 4.16%

   

2,500

Proctor & Gamble Co.

   

149,925

      

Telephone Communications - 4.36%

    

5,500

AT&T Corp.

   

157,300

      

TOTAL FOR COMMON STOCKS (Cost $2,537,439) - 87.63%

   

$        3,159,420

      

EXCHANGE TRADED FUNDS - 4.07%

    

5,000

Aberdeen Asia Pacific Fund

   

$            34,800

2,000

Direxion Large Cap Bear 3X Shares *

   

$            24,840

5,000

The Gabelli Global Gold, Natural Resources & Income Trust

  

              87,250

      

TOTAL FOR EXCHANGE TRADED FUNDS (Cost $87,209) - 4.07%

   

$          146,890

      

REAL ESTATE INVESTMENT TRUSTS - 4.39%

    

9,000

Annaly Capital Management, Inc.

   

$          158,400

      

TOTAL FOR REAL ESTATE INVESTMENT TRUSTS (Cost $130,550) - 4.39%

  

$          158,400

      

 PUT OPTIONS

    
      

Shares Subject

Underlying Security

    

to Put

Expiration Date/Exercise Price

    
      
 

Annaly Capital Management, Inc.

    

8,500

January 2012 Put @ 15.00

   

$            17,085

      
 

AT&T Corp.

    

5,500

January 2012 Put @ 20.00

   

                5,500

      
 

Bristol Myers Squibb Co.

    

6,000

January 2012 Put @ 20.00

   

                7,320

      
 

Walt Disney Co.

    

4,500

January 2012 Put @ 25.00

   

                9,090

      
 

Exxon Mobil Corp.

    

2,600

January 2012 Put @ 52.50

   

                9,880

      
 

General Mills, Inc.

    

4,000

January 2012 Put @ 30.00

   

                7,040

      
 

Heinz Co.

    

3,400

January 2012 Put @ 40.00

   

                7,310

      
 

Intel Corp.

    

8,500

January 2012 Put @ 15.00

   

              10,795

      
 

ITT Corp.

    

2,700

January 2011 Put @ 45.00

   

                5,805

      
 

Kellogg Co.

    

3,000

January 2012 Put @ 40.00

   

                4,950

      
 

Lockheed Martin Corp.

    

2,500

January 2012 Put @ 65.00

   

              16,275

      
 

Microsoft Corp.

    

6,500

January 2012 Put @ 22.50

   

              17,225

      
 

Molson Coors Brewing Co.

    

3,000

January 2011 Put @ 35.00

   

                  300

      
 

Paychex, Inc.

    

5,700

January 2012 Put @ 25.00

   

              14,820

      
 

Petroleo Brasileiro S.A.

    

4,600

January 2012 Put @ 30.00

   

              12,742

      
 

Philip Morris International, Inc.

    

3,500

January 2012 Put @ 40.00

   

                8,050

      
 

Proctor & Gamble Co.

    

2,500

January 2012 Put @ 50.00

   

                7,625

      
 

Schwab Corp.

    

10,000

January 2012 Put @ 12.50

   

              15,500

      
 

Wallgreen Co.

    

5,500

January 2012 Put @ 22.50

   

                6,160

      
 

TOTAL (Premiums Paid $249,412) - 5.09%

   

$          183,472

      

SHORT TERM INVESTMENTS - 2.65%

    

95,404

Fidelity Institutional Government Money Market Fund-Class I, 0.06%** (Cost $95,404)

 

              95,404

      

TOTAL INVESTMENTS (Cost $3,100,014) - 103.83%

   

$        3,743,586

      

LIABILITIES IN EXCESS OF OTHER ASSETS - (3.83%)

   

          (138,186)

      

NET ASSETS - 100.00%

   

$        3,605,400

      

* Non-income producing securities during the period.

    

** Variable rate security; the coupon rate shown represents the yield at March 31, 2010.

   
      

Leigh Baldwin Total Return Fund

Schedule of Options Written

September 30, 2010 (Unaudited)

      
 

CALL OPTIONS WRITTEN

    
      

Shares Subject

Underlying Security

    

to Call

Expiration Date/Exercise Price

   

Value

      
 

Annaly Capital Management, Inc.

    

            10,000

 October 2010 Call @ 18.00

   

$                900

      
 

AT&T Corp.

    

              5,500

 November 2010 Call @ 29.00

   

                2,420

      
 

Bristol Meyers Squibb Co.

    

              6,000

 October 2010 Call @ 28.00

   

                  720

      
 

Walt Disney Co.

    

              4,500

 October 2010 Call @ 35.00

   

                  405

      
 

DreamWorks Animation SKG, Inc.

    

              2,000

 November 2010 Call @ 35.00

   

                1,000

      
 

Exxon Mobil Corp.

    

              2,600

 October 2010 Call @ 62.50

   

                1,430

      
 

General Mills, Inc.

    

              1,000

 October 2010 Call @ 737.50

   

                1,560

      
 

Gilead Sciences, Inc.

    

              1,000

 October 2010 Call @ 36.00

   

                  550

      
 

Heinz Co.

    

              3,400

 October 2010 Call @ 47.00

   

                3,264

      
 

Intel Corp.

    

              9,000

 October 2010 Call @ 19.00

   

                5,580

      
 

ITT Corp.

    

              3,000

 October 2010 Call @ 50.00

   

                  300

      
 

Kellogg Co.

    

              3,000

 October 2010 Call @ 50.00

   

                3,060

      
 

Lockheed Martin Corp.

    

              2,000

 October 2010 Call @ 870.00

   

                4,000

      
 

Lockheed Martin Corp.

    

                500

 October 2010 Call @ 75.00

   

                    75

      
 

Microsoft Corp.

    

              6,500

 October 2010 Call @ 25.00

   

                1,625

      
 

Molson Coors Brewing Co.

    

              3,300

 October 2010 Call @ 45.00

   

                7,590

      
 

Paychex, Inc.

    

              6,000

 October 2010 Call @ 26.00

   

                8,400

      
 

Petroleo Brasileiro S.A.

    

              4,600

 October 2010 Call @ 36.00

   

                4,600

      
 

Proctor & Gamble Co.

    

              2,500

 October 2010 Call @ 62.50

   

                  150

      
 

Philip Morris International, Inc.

    

              3,500

 October 2010 Call @ 55.00

   

                5,145

      
 

Schwab Corp.

    

            10,000

 October 2010 Call @ 14.00

   

                5,500

      
 

Suncor Energy, Inc.

    

              2,000

 October 2010 Call @ 32.00

   

                2,300

      
 

Wallgreen Co.

    

              5,500

 October 2010 Call @ 29.00

   

              24,475

      
 

Total (Premiums Received $55,297)

   

$            85,049

      

NOTES TO FINANCIAL STATEMENTS

    

Leigh Baldwin Total Retrun Fund

    

1. SECURITY TRANSACTIONS

    

At September 30, 2010, the net unrealized depreciation on investments, based on cost for federal income tax purposes of $3,100,014 amounted to $211,980, which consisted of aggregate gross unrealized appreciation of $93,227 and aggregate gross unrealized depreciation of $305,207.

      

2. SECURITY VALUATION

    

Equity securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  Securities that are traded on any stock exchange or on the NASDAQ over-the-counter market are generally valued by the pricing service at the last quoted sale price.  Lacking a last sale price, an equity security is generally valued by the pricing service at its last bid price.  When market quotations are not readily available, when the adviser determines that the market quotation or the price provided by the pricing service does not accurately reflect the current market value, or when restricted or illiquid securities are being valued, such securities are valued as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review by the Board of Trustees.

      

Fixed income securities generally are valued by using market quotations, but may be valued on the basis of prices furnished by a pricing service when the adviser believes such prices accurately reflect the fair market value of such securities.  A pricing service utilizes electronic data processing techniques based on yield spreads relating to securities with similar characteristics to determine prices for normal institutional-size trading units of debt securities without regard to sale or bid prices.  If the adviser decides that a price provided by the pricing service does not accurately reflect the fair market value of the securities, when prices are not readily available from a pricing service, or when restricted or illiquid securities are being valued, securities are valued at fair value as determined in good faith by the adviser, in conformity with guidelines adopted by and subject to review of the Board of Trustees.  Short term investments in fixed income securities with maturities of less than 60 days when acquired, or which subsequently are within 60 days of maturity, are valued by using the amortized cost method of valuation, which the Board has determined will represent fair value.     

In accordance with FAS 157, fair value is defined as the price that the Funds 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.  The three-tier hierarchy of inputs is summarized below:

      

Valuation Inputs of Assets

Level 1

Level 2

Level 3

Total

Common Stock

$3,159,420

              $0

              $0

$3,159,420

Exchange Traded Funds

$146,890

              $0

              $0

$146,890

Real Estate Investment Trusts

$     158,400

$0

$0

$158,400

Options Purchased

$     183,472

              $0

              $0

$183,472

Cash Equivalents

$       95,404

              $0

              $0

$95,404

Total

 

$3,743,586

$0

       $0

$3,743,586

      
      

Valuation Inputs of Liabilities

Level 1

Level 2

Level 3

Total

Options Written

$       85,049

       $0

$0

$85,049

Total

 

$       85,049

       $0

       $0

$85,049








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/Brian J. Frank, President

 Brian J. Frank

 President


Date: November 22, 2010


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/Brian J. Frank, President

Brian J. Frank

President


Date November 22, 2010


By /s/Monique M. Weiss

Monique M. Weiss

Secretary


Date November 22, 2010