-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, T2gy89YblGzeU8rjpC/tWsyFjkTKOkDC2bnSznEWybuWa3EHd6cJsJjgaULiW8Lz 6bk/dAvFG6/15EVb1lq1Ow== 0000927016-01-000130.txt : 20010123 0000927016-01-000130.hdr.sgml : 20010123 ACCESSION NUMBER: 0000927016-01-000130 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20001031 FILED AS OF DATE: 20010112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORTH AMERICAN FUNDS CENTRAL INDEX KEY: 0000848103 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-05797 FILM NUMBER: 1508126 BUSINESS ADDRESS: STREET 1: CYPRESS TREE INVESTMENTS STREET 2: 286 CONGRESS ST CITY: BOSTON STATE: MA ZIP: 02210 BUSINESS PHONE: 6172104520 MAIL ADDRESS: STREET 1: CYPRESS TREE INVESTMENTS STREET 2: 286 CONGRESS ST CITY: BOSTON STATE: MA ZIP: 02210 FORMER COMPANY: FORMER CONFORMED NAME: NORTH AMERICAN SECURITY TRUST DATE OF NAME CHANGE: 19920703 N-30D 1 0001.txt 2000 ANNUAL REPORT A NORTH AMERICAN FUNDS N A specialized family of mutual funds N managed by experts U with your dreams in mind. A [VARIOUS FUND COMPANY LOGOS ARE SCREENED IN BACKGROUND] L OCTOBER 31, 2000 R E AUDITED FINANCIAL P STATEMENTS O R T AMERICAN |GENERAL |FINANCIAL GROUP NORTH AMERICAN FUNDS President's Message - ------------------------------------------------------------------------------- Dear Shareholders, What's New at North American Funds October 31, 2000 marks the end of an exciting fiscal year for the North American Funds. This year, North American Funds became part of the American General Financial Group, one of the nation's largest diversified financial services organizations with assets of $123 billion. We believe the strength of our new organization will only enhance our ability to build and deliver high quality investment products to help you pursue your investment dreams. The Strength Behind our Multi-Manager Strategy Our extensive line-up of funds and managers was carefully selected to offer a wide choice of options to meet your investment needs and help you build a well-diversified portfolio. We believe our multi-manager approach offers a strong advantage--providing oversight by a team of investment research professionals with extensive knowledge and an average of 18 years of investing experience. The team, made up of a chief economist, investment managers, mutual fund strategists, and analysts actively oversee the managers, ensuring adherence to investment style and the pursuit of competitive, risk-adjusted returns. Not only do our research specialists spend time choosing the right sub-advisors for our funds, but they go one step further. They actively monitor these managers to ensure they are meeting expectations. This strong combination of an experienced research team, a rigorous selection process and ongoing monitoring offers you peace of mind in knowing your investments are in the hands of experienced, knowledgeable and accountable investment professionals. Market Conditions The twelve month period ending October 31, 2000 witnessed a big change in investor sentiment. In the fourth quarter of 1999 and through most of the first quarter of 2000, the equity markets continued their long rally, led by low inflation, robust growth and rising confidence. Strength came from within the growth universe as exceptional gains in many U.S.-based large-cap technology stocks set the pace and investors continued to invest in "dot com" companies based on the future earnings potential the internet could provide. While investors continued to clamor for growth stocks, demand for US value stocks paled. Equity Markets Because of possible inflation fears the Federal Reserve continued a series of increasing interest rates in hopes of slowing the economy. The market gains of the first quarter quickly evaporated during the second quarter as the market grew concerned about future growth prospects. Additionally, the previous euphoria over the Internet and its impact on the economy gave way to the hard reality that eventually even Internet companies must generate profits in order to remain in business. Each of the major indices, the S&P 500, the Dow and NASDAQ all finished the second quarter down. Stubbornly rising oil prices, a surprisingly weak Euro, and a string of earnings and revenue disappointments by a number of large U.S. multinational companies led to a roller coaster-like equity market during the third quarter. As a result, the S&P 500, the Dow and NASDAQ all finished down for the second straight quarter. Technology, telecommunications and media, the three leaders of last year, were particularly weak performers while health care, financials and energy did quite well. In a reversal from the previous year, small caps outperformed large caps and value outperformed growth as investors began to pay attention to valuations after many months of wanting growth at any price. NORTH AMERICAN FUNDS President's Message continued - ------------------------------------------------------------------------------- This is evidenced by the fact that from January 1, 2000 to October 31, 2000, the Russell 1000 Value Index returned 9.43%, while the Russell 1000 Growth was down -1.42%. In the U.S. domestic equity markets for the entire fiscal year ended October 31, 2000, mid cap stocks were the best performing equity class followed by small caps and then large caps. The S&P 400 Index, a benchmark for mid cap stocks, gained 30.17% over the year, followed by the small cap Russell 2000 Index return of 17.26%. The S&P 500 Index, which is dominated by large cap stocks, returned 6.09%. In regards to growth and value stocks, for the twelve month period ending October 31, 2000, the Russell 1000 Growth Index returned 9.32%, while the Russell 1000 Value Index returned 5.54%. The same trends of technology and communications that drove the equity markets in the U.S., along with an overall theme of restructuring throughout the rest of the world, led equity markets in both Europe and Asia to increase at the end of 1999 and the beginning of 2000. As the U.S. markets began to deteriorate because of strong energy prices, a weak euro, weaker than expected corporate earnings and interest rate increases in the second quarter of 2000, the non-U.S. market followed. The benchmarks for the international markets, the Morgan Stanley International (MSCI) EAFE Index and the MSCI World Index reflect this trend, returning -2.66% and 1.39% respectively. Fixed Income Markets The fixed income markets, having taken a back seat to the equity markets in recent years, witnessed a "flight to quality" during the second part of 2000, with U.S. Treasuries and high quality corporate bonds substantially outperforming lower quality issues. The Lehman Brothers Aggregate Bond Index returned 7.30% and the Lehman Brothers Corporate Bond Index returned 5.38% for the year ending October 31, 2000. During the same twelve month period, the Credit Suisse High Yield Index, a benchmark for the high yield bond market, returned 6.31%. During times of increased market volatility it is understandable to become a bit unsettled. We strongly encourage you to consult your investment advisor. Contacting your advisor also presents an opportunity to do a portfolio "check up" to ensure that your current investment strategy is in line with your goals. We appreciate your continued business with North American Funds and if you have any questions about your investments, simply call us at 800-872-8037. Or, you can obtain up-to-date information on any North American Fund, including performance information, daily pricing and other facts, on our website at www.northamericanfunds.com. Sincerely, /s/ Alice T. Kane Alice T. Kane Chairman and President North American Funds 2 NORTH AMERICAN FUNDS INDEX TO ANNUAL REPORT - --------------------------------------------------------------------------------
Page ---- Fund Performance and Portfolio Manager's Commentary........................ iii Report of Independent Accountants.......................................... 1 Statements of Assets and Liabilities....................................... 2 Statements of Operations................................................... 12 Statements of Changes in Net Assets........................................ 17 Financial Highlights....................................................... 25 Portfolio of Investments Growth & Income Fund..................................................... 50 Large Cap Growth Fund.................................................... 51 Mid Cap Growth Fund...................................................... 53 Mid Cap Value Fund....................................................... 55 Science & Technology Fund................................................ 57 Small Cap Growth Fund.................................................... 57 Small Cap Index Fund..................................................... 59 Socially Responsible Fund................................................ 78 Stock Index Fund......................................................... 82 Global Equity Fund....................................................... 88 International Equity Fund................................................ 89 International Small Cap Fund............................................. 96 Balanced Fund............................................................ 99 Core Bond Fund........................................................... 101 High Yield Bond Fund..................................................... 104 Municipal Bond Fund...................................................... 108 Strategic Income Fund.................................................... 110 U.S. Government Securities Fund.......................................... 114 Money Market Fund........................................................ 115 Municipal Money Market Fund.............................................. 116 Aggressive Growth LifeStyle Fund......................................... 117 Moderate Growth LifeStyle Fund........................................... 117 Conservative Growth LifeStyle Fund....................................... 118 Notes to Financial Statements.............................................. 119
THIS PAGE INTENTIONALLY LEFT BLANK. NORTH AMERICAN FUNDS FUND PERFORMANCE AND PORTFOLIO MANAGER'S COMMENTARY - ------------------------------------------------------------------------------- Fund Performance In the following pages we have set forth information regarding the performance of each portfolio of the North American funds, except the Money Market Fund and Municipal Money Market Fund. There are several ways to evaluate a Fund's historical performance. One can look at the total percentage change in value, the average annual percentage change, or the growth of a hypothetical $10,000 investment. With respect to all the performance information presented, it is important to understand that past performance does not guarantee future results. Return and principal fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Performance Tables The Performance Tables show two types of total return information: cumulative and average annual total returns. A cumulative total return is an expression of a Fund's total change in share value in percentage terms over ten years (or since the Fund's inception if less than ten years). An average annual total return takes the Fund's cumulative total return over a set period of time - one, five and ten years (or since the Fund's inception if less than ten years) and shows what would have happened if the Fund had performed at a constant rate each year. For all share classes, the tables show cumulative and average annual total returns both net of the possible maximum applicable front-end or back-end sales charge, as well as without giving effect to such possible maximum charges (at net asset value "NAV"). For each Fund, if certain expenses were not reimbursed, performance would be lower. Graph - Change in Value of $10,000 Investment and Comparative Indices The performance graph for each Fund shows the change in value of a $10,000 investment over the life of the Fund's Class A shares. Each Fund's performance is compared to the performance of one or more broad-based securities indices as a "benchmark". Fund results (which include the reinvestment of dividends and capital gains distributions as well as the deduction of ongoing management and distribution fees and operating expenses) reflect the deduction of the current maximum sales charge applicable to each Fund's Class A shares. Please note that effective April 1, 1994, Class B and Class C shares were offered. Performance of these share classes will differ. Historical performance prior to April 1, 1994 is that of the Fund before it adopted the current multi-class structure. On July 7, 2000 the North American Funds merged with the American General Series Portfolio Company 2 (AGSPC2), adding nine new North American Funds. They are as follows: Mid Cap Value, Science & Technology, Socially Responsible, Stock Index, Aggressive Growth LifeStyle, Moderate Growth LifeStyle, Conservative Growth LifeStyle, High Yield Bond and Municipal Money Market. Performance information for those Funds shown for periods prior to July 7, 2000, is that of the corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July, 7 2000. Each AGSPC2 Fund had the same investment objective and investment strategies and policies as does the corresponding North American Fund, and was also managed by the same portfolio managers. Benchmarks used for comparison are unmanaged and do not reflect any fees or expenses. Portfolio Manager's Commentary Finally, we have provided a commentary by each Fund's portfolio manager regarding each Fund's performance during the fiscal year ended October 31, 2000. All performance results referenced in the commentary are Class A share returns. iii Growth & Income Fund Investment Seeks to provide long-term growth of capital and income Objective: consistent with prudent investment risk by investing primarily in a diversified portfolio of common stocks of U.S. issuers that the portfolio manager believes are of high quality. Subadvisor: Wellington Management Company LLP ("Wellington") Portfolio Matthew E. Megargel Manager: Inception Date: May 1, 1991 [GRAPH] NAV 5.75% Sales MSCI World Index Charge Apr-91 10,000 9,425 10,000 May-91 10,240 9,651 10,428 Jun-91 9,879 9,311 9,951 Jul-91 10,201 9,614 10,417 Aug-91 10,352 9,757 10,662 Sep-91 10,205 9,618 10,487 Oct-91 10,588 9,979 10,628 Nov-91 10,175 9,590 10,198 Dec-91 11,088 10,450 11,364 Jan-92 10,775 10,155 11,153 Feb-92 10,876 10,250 11,295 Mar-92 10,642 10,030 11,074 Apr-92 10,805 10,183 11,396 May-92 10,845 10,222 11,458 Jun-92 10,779 10,159 11,292 Jul-92 11,217 10,572 11,747 Aug-92 11,146 10,505 11,509 Sep-92 11,400 10,745 11,642 Oct-92 11,480 10,820 11,684 Nov-92 11,777 11,100 12,077 Dec-92 12,007 11,317 12,236 Jan-93 12,162 11,463 12,325 Feb-93 12,286 11,579 12,491 Mar-93 12,677 11,948 12,760 Apr-93 12,430 11,715 12,447 May-93 12,657 11,929 12,783 Jun-93 12,656 11,928 12,826 Jul-93 12,625 11,899 12,765 Aug-93 13,008 12,260 13,252 Sep-93 12,956 12,211 13,154 Oct-93 13,153 12,396 13,421 Nov-93 12,884 12,143 13,294 Dec-93 13,112 12,358 13,458 Jan-94 13,574 12,793 13,909 Feb-94 13,406 12,635 13,533 Mar-94 12,892 12,150 12,945 Apr-94 13,028 12,279 13,113 May-94 13,259 12,497 13,327 Jun-94 12,932 12,188 12,997 Jul-94 13,481 12,706 13,428 Aug-94 13,871 13,074 13,974 Sep-94 13,607 12,825 13,637 Oct-94 13,819 13,024 13,950 Nov-94 13,196 12,437 13,438 Dec-94 13,421 12,650 13,634 Jan-95 13,432 12,660 13,988 Feb-95 13,957 13,154 14,531 Mar-95 14,263 13,443 14,961 Apr-95 14,700 13,855 15,397 May-95 15,137 14,267 16,005 Jun-95 15,458 14,569 16,381 Jul-95 15,876 14,963 16,926 Aug-95 16,008 15,088 16,972 Sep-95 16,482 15,534 17,683 Oct-95 16,206 15,275 17,621 Nov-95 16,845 15,876 18,397 Dec-95 17,117 16,133 18,737 Jan-96 17,520 16,513 19,374 Feb-96 17,565 16,555 19,554 Mar-96 17,856 16,829 19,742 Apr-96 18,113 17,072 20,032 May-96 18,516 17,451 20,549 Jun-96 18,499 17,435 20,627 Jul-96 17,801 16,778 19,715 Aug-96 18,195 17,149 20,131 Sep-96 19,218 18,113 21,265 Oct-96 19,747 18,611 21,852 Nov-96 21,231 20,010 23,504 Dec-96 20,826 19,628 23,038 Jan-97 21,963 20,700 24,478 Feb-97 22,190 20,914 24,669 Mar-97 21,328 20,102 23,655 Apr-97 22,549 21,253 25,065 May-97 23,842 22,471 26,589 Jun-97 25,146 23,701 27,780 Jul-97 27,109 25,551 29,989 Aug-97 25,637 24,163 28,309 Sep-97 26,990 25,438 29,858 Oct-97 26,056 24,558 28,860 Nov-97 27,241 25,675 30,197 Dec-97 27,549 25,965 30,716 Jan-98 27,861 26,259 31,057 Feb-98 29,729 28,020 33,296 Mar-98 31,222 29,426 35,001 Apr-98 31,637 29,818 35,355 May-98 30,806 29,035 34,746 Jun-98 32,013 30,172 36,157 Jul-98 31,844 30,013 35,774 Aug-98 27,264 25,696 30,608 Sep-98 28,912 27,249 32,570 Oct-98 31,481 29,671 35,218 Nov-98 33,207 31,298 37,352 Dec-98 34,771 32,771 39,504 Jan-99 35,875 33,812 41,155 Feb-99 35,053 33,038 39,875 Mar-99 36,575 34,472 41,470 Apr-99 38,097 35,906 43,075 May-99 37,046 34,916 42,058 Jun-99 39,013 36,769 44,393 Jul-99 37,935 35,754 43,008 Aug-99 37,693 35,525 42,793 Sep-99 36,562 34,459 41,620 Oct-99 38,757 36,528 44,270 Nov-99 39,080 36,833 45,172 Dec-99 40,869 38,519 47,830 Jan-00 38,992 36,750 45,427 Feb-00 37,966 35,783 44,568 Mar-00 42,042 39,625 48,928 Apr-00 40,854 38,505 47,455 May-00 40,253 37,939 46,482 Jun-00 40,884 38,533 47,627 Jul-00 40,004 37,704 46,883 Aug-00 42,350 39,915 49,795 Sep-00 39,931 37,635 47,167 Oct-00 39,681 37,400 46,967 Performance Table
Average Annual Total Cumulative Return Total Return ----------------------- ------------ 1 5 Since Since Year Years Inception Inception Periods Ending October 31, 2000 ------ ------ --------- ------------ S&P 500 Index/1/ 6.09% 21.67% 17.17% 369.67% Growth & Income Fund Class A (NAV) 2.39% 19.61% 18.61% 296.81% Growth & Income Fund Class A (net of 5.75% sales charge) -3.50% 18.20% 17.54% 274.00% Growth & Income Fund Class B (NAV) 1.75% 18.90% 17.97% 197.07% Growth & Income Fund Class B (net of CDSC)/2/ -3.25% 18.70% 17.97% 197.07% Growth & Income Fund Class C (NAV) 1.74% 18.89% 15.13% 281.87% Growth & Income Fund Class C (net of CDSC)/3/ 0.74% 18.89% 15.13% 281.87% Growth & Income Fund Institutional Class I/4/ N/A N/A -4.04% -4.04%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 7/10/2000. iv Portfolio Manager's Commentary The Growth and Income Fund Class A share performance for the year-ended October 31, 2000 was 2.39% as compared to the S&P 500 Index return of 6.09%. The last 12 months proved to be extraordinary for the equity markets as the gains of 1999 were quickly wiped out by severe losses in 2000. The first ten months of the year were especially difficult for investors as the euphoria over the Internet and its impact on the economy gave way to the hard reality that eventually even Internet companies must generate profits in order to remain in business. This pop in the technology valuation bubble coupled with a series of short-term interest rate increases by the Federal Reserve led to tough times for the equity markets. The sectors that outperformed during this difficult time period included non-cyclical sectors such as health care, food and beverage, tobacco and electric utilities. Financial services stocks also performed well during this time period. After a long awaited period, value stocks rallied as investors fled to stocks with more reasonable valuations. Within the Fund, our underweight position within Technology helped the Fund during the sector's decline, but results were mixed as some of our holdings such as VeriSign, Analog Devices and Micron Technology suffered larger than expected declines. Additionally, the unexpectedly weak Euro and a string of earnings and revenues disappointments for large US multinational firms hurt performance. Conversely, our overweight positions within health care and energy positively contributed to the Fund's performance. Examples of positive performers within the Fund were Merck & Co, Kimberly-Clark Corp. and SBC Communications. Going forward, with inflation estimates rising, earnings estimates falling, and political uncertainty mounting, it seems appropriate to directionally move the Fund towards relatively stable and generally predictable growth sectors such as: health care, financial services, consumer products, and computer services. The biggest positive on the horizon is the possibility that the Fed may begin to cut interest rates later next year if evidence continues to grow that the economy is slowing. However, political considerations and continual upward revisions in the CPI may stay the Fed's easing hand near-term. In the meantime, equity market liquidity remains fairly high; the dollar continues as the currency of choice, and while valuations in some sectors seem stretched, we remain cautiously optimistic about equities. Technology, telecommunications and media remain volatile with near term decelerating earnings growth and concerns about too much capital chasing the same market opportunities. We have selectively reduced our overall exposure to some of these sectors, but we remain alert for price opportunities given the solid absolute earnings per share growth and positive long-term outlook. v Large Cap Growth Fund Investment Seeks to provide long-term capital appreciation by Objective: investing at least 65% of its assets in common stocks of well-established, high-quality growth companies. Subadvisor: Founders Asset Management LLC ("Founders") Portfolio Scott Chapman, Tom Arrington Managers: Inception Date: March 4, 1996 [GRAPH] NAV 5.75% Sales Charge S&P 500 Mar-96 10,000 9,425 10,000 Mar-96 10,080 9,500 10,096 Apr-96 10,680 10,066 10,245 May-96 11,168 10,526 10,509 Jun-96 11,040 10,405 10,549 Jul-96 10,216 9,629 10,083 Aug-96 10,560 9,953 10,296 Sep-96 11,104 10,466 10,875 Oct-96 11,024 10,390 11,175 Nov-96 11,712 11,039 12,021 Dec-96 11,305 10,655 11,783 Jan-97 11,994 11,304 12,519 Feb-97 11,702 11,029 12,617 Mar-97 11,329 10,678 12,100 Apr-97 11,872 11,190 12,821 May-97 12,578 11,855 13,601 Jun-97 13,243 12,481 14,210 Jul-97 14,419 13,590 15,341 Aug-97 13,713 12,925 14,482 Sep-97 14,419 13,590 15,275 Oct-97 13,794 13,001 14,766 Nov-97 13,932 13,131 15,449 Dec-97 14,173 13,358 15,714 Jan-98 14,323 13,500 15,887 Feb-98 15,253 14,376 17,033 Mar-98 16,068 15,144 17,904 Apr-98 16,325 15,386 18,084 May-98 16,086 15,161 17,774 Jun-98 16,945 15,971 18,495 Jul-98 16,644 15,687 18,299 Aug-98 13,756 12,965 15,656 Sep-98 14,615 13,775 16,659 Oct-98 15,705 14,802 18,013 Nov-98 16,476 15,528 19,105 Dec-98 17,734 16,714 20,205 Jan-99 18,959 17,868 21,049 Feb-99 18,450 17,389 20,396 Mar-99 19,467 18,348 21,211 Apr-99 19,185 18,081 22,033 May-99 18,375 17,318 21,513 Jun-99 19,627 18,499 22,706 Jul-99 18,949 17,860 21,999 Aug-99 18,977 17,886 21,889 Sep-99 18,657 17,584 21,290 Oct-99 20,192 19,031 22,614 Nov-99 21,247 20,025 23,075 Dec-99 24,539 23,128 24,433 Jan-00 23,705 22,342 23,205 Feb-00 26,015 24,519 22,766 Mar-00 26,549 25,023 24,993 Apr-00 23,417 22,070 24,241 May-00 21,524 20,286 23,744 Jun-00 23,235 21,899 24,329 Jul-00 22,732 21,425 23,949 Aug-00 25,159 23,713 25,436 Sep-00 23,491 22,141 24,094 Oct-00 21,335 20,109 23,785 Performance Tab
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2000 ------ --------- ------------ S&P 500 Index/4/ 6.09% 20.37% 137.85% Large Cap Growth Fund Class A (NAV) 5.66% 17.65% 113.35% Large Cap Growth Fund Class A (net of 5.75% sales charge) -0.41% 16.16% 101.09% Large Cap Growth Fund Class B (NAV) 5.01% 16.91% 107.21% Large Cap Growth Fund Class B (net of CDSC)/1/ 0.01% 16.67% 105.21% Large Cap Growth Fund Class C (NAV) 5.06% 16.90% 107.16% Large Cap Growth Fund Class C (net of CDSC)/2/ 4.06% 16.90% 107.16% Large Cap Growth Fund Institutional Class I/3/ N/A -9.04% -9.04%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/10/2000. /4/All since-inception returns for indices begin on the month-end closest to the actual inception date of the fund. vi Portfolio Managers' Commentary For the fiscal year ended October 31, 2000, the Large Cap Growth Fund's Class A shares posted an average annual return of 5.66%, compared to the unmanaged Standard & Poor's Index's return of 6.09%. The period between November 1, 1999 and October 31, 2000 was marked by extreme market volatility. Although the end of 1999 and first quarter of 2000 were very favorable periods for large-cap growth stocks, by late March, the market turned and the environment became extremely challenging. Through October, investors showed concern about the impact of a number of high-profile earnings warnings, high oil prices, election uncertainties, slower economic growth, the Federal Reserve Board's six rate hikes since June 1999, and the potential for inflation with unemployment at a 30-year low. Unfortunately, the positive influences of the budget surplus and the growth of companies meeting the demand of Internet data traffic doubling every 90 days are events that have yet to dominate the investor's mindset. In spite of these difficulties, the Fund did particularly well in the most recent quarter of 2000, thanks to strong stock picking within the technology sector. Furthermore, we have been consistently pleased with the earnings reports from the companies in the portfolio, and see growth opportunities in several areas, such as fiberoptics and media. It should be noted that investors have been bearish of late, and therefore many companies in the Fund have not received the recognition we believe they are due. However, in our opinion, if we continue to invest in high-quality companies that are producing solid earnings, shareholders will eventually be rewarded, as stock prices have historically followed earnings. vii Mid Cap Growth Fund Investment Seeks to provide long-term capital appreciation by Objective: investing primarily in common stocks of mid-sized companies--those with market capitalizations ranging from approximately $2 billion to $15 billion at the time of purchase. The core of the Fund's portfolio will be invested in securities of established companies that are leaders in growth markets with a history of strong returns. Subadvisor: INVESCO Funds Group, Inc. ("INVESCO") Portfolio Tim Miller, Thomas Wald Managers: Inception Date: March 4, 1996/4/ [GRAPH] NAV 5.75% Sales Charge S&P 500 Mar-96 10,000 9,425 10,000 Mar-96 10,168 9,583 10,120 Apr-96 10,584 9,975 10,429 May-96 10,768 10,149 10,569 Jun-96 10,352 9,757 10,411 Jul-96 9,312 8,777 9,707 Aug-96 9,792 9,229 10,267 Sep-96 10,328 9,734 10,714 Oct-96 10,096 9,515 10,745 Nov-96 10,696 10,081 11,350 Dec-96 10,504 9,900 11,363 Jan-97 10,944 10,315 11,789 Feb-97 10,240 9,651 11,692 Mar-97 9,688 9,131 11,194 Apr-97 9,832 9,267 11,485 May-97 10,600 9,991 12,488 Jun-97 11,248 10,601 12,839 Jul-97 12,328 11,619 14,110 Aug-97 12,184 11,483 14,092 Sep-97 13,080 12,328 14,902 Oct-97 12,408 11,695 14,254 Nov-97 12,448 11,732 14,465 Dec-97 12,173 11,473 15,027 Jan-98 12,156 11,457 14,740 Feb-98 13,287 12,523 15,961 Mar-98 14,166 13,352 16,681 Apr-98 14,109 13,298 16,985 May-98 13,653 12,868 16,221 Jun-98 14,695 13,850 16,323 Jul-98 14,410 13,582 15,691 Aug-98 11,489 10,828 12,773 Sep-98 12,286 11,580 13,965 Oct-98 13,092 12,339 15,211 Nov-98 14,052 13,244 15,970 Dec-98 15,782 14,875 17,898 Jan-99 15,623 14,724 17,202 Feb-99 14,869 14,014 16,302 Mar-99 16,146 15,218 16,757 Apr-99 16,217 15,285 18,078 May-99 16,323 15,385 18,157 Jun-99 17,565 16,555 19,128 Jul-99 16,652 15,694 18,722 Aug-99 16,164 15,234 18,080 Sep-99 16,031 15,109 17,523 Oct-99 16,430 15,485 18,415 Nov-99 18,275 17,224 19,382 Dec-99 20,864 19,665 20,533 Jan-00 20,254 19,089 19,955 Feb-00 23,750 22,385 21,350 Mar-00 23,099 21,771 23,136 Apr-00 20,699 19,509 22,329 May-00 19,168 18,066 22,050 Jun-00 22,085 20,815 22,374 Jul-00 21,247 20,025 22,728 Aug-00 24,516 23,106 25,264 Sep-00 24,154 22,765 25,091 Oct-00 22,161 20,887 24,240 Performance Table
Average Annual Total Return Cumulative Total Return ---------------------------- ------------------------- 1 Since Since Since Since Periods Ending October Year Inception 3/13/00/4/ Inception 3/13/00/4/ 31, 2000 ------ --------- ----------- ----------- ------------ S&P 400 Midcap Index/1/ 31.63% 20.89% 13.53% 142.40% 13.53% Mid Cap Growth Fund Class A (NAV) 35.03% 18.61% -12.20% 121.61% -12.20% Mid Cap Growth Fund Class A (net of 5.75% sales charge) 27.27% 17.11% -17.25% 108.87% -17.25% Mid Cap Growth Fund Class B (NAV) 34.04% 17.75% -12.57% 114.26% -12.57% Mid Cap Growth Fund Class B (net of CDSC)/2/ 29.04% 17.52% -16.94% 112.26% -16.94% Mid Cap Growth Fund Class C (NAV) 33.95% 17.77% -12.60% 114.45% -12.60% Mid Cap Growth Fund Class C (net of CDSC)/3/ 32.95% 17.77% -13.46% 114.45% -13.46% Mid Cap Growth Fund Institutional Class I/5/ N/A -0.85% -0.85% -0.85% -0.85%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Current investment subadvisor assignment became effective 3/13/00. /5/Inception date is 7/10/2000. viii Portfolio Managers' Commentary The Mid Cap Growth Fund Class A share performance for the year-ended October 31, 2000 was 35.03% outperforming the S&P 400 Midcap Index return of 31.63%. After exhibiting strong returns at the beginning of the fiscal year, domestic equities have came under renewed--and at times, intense--selling pressure beginning in March. Market jitters, including interest rate fears, political uncertainty, and negative earnings pre-announcements, pulled the market lower. By the end of November, most of the major market indices stood considerably below their highs from earlier in the year. On a positive note, signs of a cooling economy raised hopes that the Federal Reserve might abandon its restrictive policy bias, laying the groundwork for potential interest rate cuts in 2001. The bad news, however, was that investors were fed a steady diet of negative earnings pre-announcements, alongside steadily increasing oil and gas prices. Nevertheless, the two valuation props for stocks--earnings growth expectations and P/E ratios-- continued to provide the market with solid support. The Fund's performance suffered over this period, as many of its holdings across economic sectors were caught in the market's downward volatility. The Fund's large exposure to technology and communications services holdings proved particularly troublesome, as many of these companies saw their valuations drop sharply on concerns about overcapacity and a potential slowdown in telecommunications-related investment. In our opinion, valuations in the sector are now fully appreciating a slowdown that still appears to be only a possibility, suggesting the likelihood of a strong rebound should the worst not occur. Meanwhile, the Fund's diversification helped cushion performance from the pressure in technology-related sectors, as we benefited from relatively stable performance by investments in energy, financial services, and pharmaceutical sectors. In part, our performance was aided by our recent moves into areas where growth is accelerating. Oil exploration companies such as Apache Corp have thrived recently from surging oil prices. Analysts concluded that such firms should enjoy high growth rates over the coming years as the world's oil producers strive to increase production to meet demand. Financial services holdings also helped returns. While the apparent end to this round of official interest rate increases has aided most financial stocks, our particular focus on fee-based financial companies was rewarded. One standout was Northern Trust, a bank with a strong foothold in trust management and other fee-based businesses. Additionally, a number of our specialty pharmaceutical holdings, including Forest Laboratories and King Pharmaceuticals also contributed positively to performance. Investors have rewarded these companies for their earnings predictability, which has been especially appealing in the recent uncertain environment. Going forward, we plan to keep our focus on those high-growth mid-cap companies that we believe can continue to perform well, even in an economic slowdown. In an effort to maintain diversification and dampen volatility, we plan to seek these companies out in a variety of sectors. ix Mid Cap Value Fund Investment Seeks to provide long-term capital appreciation by Objective: investing at least 65% of the Fund's total assets in equity securities of medium capitalization companies using a value oriented investment approach. Medium capitalization companies include those with the characteristics of companies included in the Russell MidcapTM Index, which as of December 31, 1999 had an average market capitalization of approximately $4.4 billion. Subadvisor: Neuberger Berman Management, Inc. ("NBM") Portfolio Robert Gendelman, S. Basu Mullick Managers: Inception Date: November 2, 1998/4/ [GRAPH] NAV 5.75% Sales Charge Russell MidCap Nov-98 10,000 9,425 10,000 Nov-98 10,500 9,896 10,351 Dec-98 10,753 10,135 10,666 Jan-99 11,034 10,399 10,417 Feb-99 10,883 10,258 10,188 Mar-99 11,385 10,730 10,334 Apr-99 12,410 11,696 11,313 May-99 12,831 12,093 11,360 Jun-99 13,272 12,509 11,489 Jul-99 13,132 12,377 11,202 Aug-99 12,329 11,621 10,815 Sep-99 11,768 11,091 10,267 Oct-99 12,023 11,332 10,570 Nov-99 12,204 11,502 10,376 Dec-99 13,329 12,563 10,654 Jan-00 12,819 12,082 10,017 Feb-00 13,261 12,498 9,598 Mar-00 14,620 13,779 10,762 Apr-00 14,031 13,224 10,805 May-00 14,337 13,512 10,990 Jun-00 14,348 13,523 10,581 Jul-00 14,982 14,121 10,828 Aug-00 15,945 15,028 11,492 Sep-00 16,251 15,316 11,602 Oct-00 16,374 15,432 11,822 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2000/4/ ------ --------- ------------ Russell Midcap Value Index/5/ 11.85% 8.74% 18.22% Mid Cap Value Fund Class A (NAV) 35.42% 28.00% 63.74% Mid Cap Value Fund Class A (net of 5.75% sales charge) 27.63% 24.26% 54.32% Mid Cap Value Fund Class B (NAV) 34.26% 26.59% 60.15% Mid Cap Value Fund Class B (net of CDSC)/1/ 29.26% 24.60% 55.15% Mid Cap Value Fund Class C (NAV)/3/ N/A 9.53% 9.53% Mid Cap Value Fund Class C (net of CDSC)/2/,/3/ N/A 8.53% 8.53% Mid Cap Value Fund Institutional Class I 36.17% 27.97% 63.65%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/31/2000. /4/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. /5/All since-inception returns for indices begin on the month-end closest to the actual inception date of the fund. x Portfolio Managers' Commentary The Mid Cap Value Fund Class A share performance for the year-ended October 31, 2000 was 35.42% significantly outperforming the Russell Midcap Value Index return of 11.85%. Financial market performance for the 12-month period ended October 2000 reflected innumerable shifts in the actual and perceived condition of the economy, the outlook for corporate earnings trends, and investor sentiment and expectations. For the entire period, financial market returns were generally positive, although lower than the out-sized equity market returns that have been characteristic of the last several years; the broad market as measured by the Wilshire 5000 appreciated 8.10% while the S&P 500 Index returned 6.09%. Sectors within the S&P 500 generating the strongest returns over the period include utilities, capital goods, health care and financials. Total return performance for style specific areas, growth and value, are positive for the 12-month period, with most growth sectors generating somewhat stronger returns (i.e. the Russell 1000 Growth Index returned 9.33% versus a 5.52% return for the Russell 1000 Value Index). However, over the course of the entire 12-month period a shift in market leadership appears to have taken place. The market environment for value stocks in the third quarter of 2000 was quite favorable, particularly in the mid-cap segment of the market. Investors continued to emphasize more conservative market sectors, shifting their focus from high-priced growth stocks with limited earnings visibility to less expensive shares with more stable earnings records. A steady interest rate environment and strong economic growth throughout the year has helped many companies in the value category build their businesses. Earnings shortfalls and concerns about longer-term growth in some of the faster-growing areas of the market also contributed to value's attractiveness. The Fund's financial holdings made the largest contribution to its total return. Reinsurer XL Capital made a positive impact, as did property and casualty insurance provider ACE Limited. Both stocks benefited from an emerging turn in the insurance cycle. The portfolio's utility and health care holdings also performed quite nicely. Technology had the least favorable impact on portfolio total return. Satellite communications company Loral Space & Communications detracted the most from returns followed by technology services provider Comdisco and Apple Computer. Communications Services (there were no remaining positions in this sector on 9/30/00) also had a small negative impact on total return. We are pleased with the broadening of returns that has occurred over the last several months in the equity markets. Concerns over the direction of interest rates and long-term corporate earnings have refocused investors' attention on company fundamentals, which has benefited many of the value stocks in which we invest. Looking ahead, we are encouraged by the recent outperformance of value investments over their growth counterparts. If the Federal Reserve Board continues to hold interest rate levels steady, against a backdrop of modest economic growth, we believe value stocks have the potential to remain in the spotlight. xi Science & Technology Fund Investment Seeks to provide long-term growth of capital by investing Objective: at least 65% of the Fund's total assets in the common stocks and equity-related securities of companies that are expected to benefit from scientific breakthroughs and advancements in technology. Subadvisor: T. Rowe Price Associates, Inc. ("TRowe") Portfolio Chip Morris Manager: Inception Date: March 10, 2000/4/ [GRAPH] NAV 5.75% Sales Charges S&P 500 Index 1-Mar 10,000 9,425 10,000 31-Mar 9,960 9,387 10,978 28-Apr 8,940 8,426 10,648 31-May 7,850 7,399 10,429 30-Jun 8,740 8,237 10,687 31-Jul 8,370 7,889 10,520 31-Aug 9,920 9,350 11,173 29-Sep 8,750 8,247 10,583 31-Oct 8,080 7,615 10,538 Performance Table
Average Annual Cumulative Total Return Total Return -------------- ------------ Since Since Inception Inception Period Ending October 31, 2000/4/ -------------- ------------ S&P 500 Index/1/ 5.38% 5.38% Science & Technology Fund Class A (NAV) -19.20% -19.20% Science & Technology Fund Class A (net of 5.75% sales charge) -23.85% -23.85% Science & Technology Fund Class B (NAV) -19.70% -19.70% Science & Technology Fund Class B (net of CDSC)/2/ -23.72% -23.72% Science & Technology Fund Class C (NAV) -7.78% -7.78% Science & Technology Fund Class C (net of CDSC)/3/ -8.71% -8.71% Science & Technology Fund Institutional Class I -19.20% -19.20%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xii Portfolio Manager's Commentary As of the year-ended October 31, 2000, the Science & Technology Fund Class A share performance since inception was -19.20% as compared to the S&P 500 Index return of 5.38% for the same time period. Investors entered 2000 with much enthusiasm for dot.com names as Internet stocks returned 27.90% from the beginning of January to March 10. However, poor earnings prospects coupled with an increasing number of dot.com failures caused aggressive technology stocks to plunge as quickly as they had soared earlier in the year. From 3/10/00 - 10/31/00, the Morgan Stanley Internet Index declined 59.07%. Losses, however, were not isolated to the Internet sector alone. During the second and third quarter, many high profile technology companies such as Intel, Nokia, Dell Computer, and Apple Computer warned investors about weaker earnings growth moving forward. Record high valuation levels and news of potentially softer profitability caused investors to rotate out of the sector in favor of more reasonably priced areas such as health care, financial services, and utilities. In this environment the Science & Technology Fund has focused on holding only the highest quality names in the technology sector as we believe that lower quality firms will get "steam rolled" in an increasingly competitive environment. We feel the technology sector is experiencing a significant shift as the dominance of the PC gives way to communications-based computing. Top holdings such as Ariba, Oracle, and Cisco Systems reflects fund management's commitment to high quality companies that will benefit from the trend towards networking and the buildout of the Internet. We have made some changes to holdings during the third quarter, initiating positions in LSI Logic, SDL, and Corning, and adding to existing holdings such as Applied Materials. We eliminated WorldCom, Dell Computer, and Softbank, and trimmed back on Sun Microsystems and CIENA after their run-up. Despite the recent selling, we believe science and technology represents the premier opportunity for growth during the next three to five years, and should continue to be the most rapidly growing segment of the global economy. The Fund will remain focused on the migration from PC-based computing to communications-driven market forces. Accordingly, we will continue to identify the leading companies involved in building the infrastructure for the Internet, and in the transmission of wire and wireless data and communications. We remain optimistic about the long-term prospects for the Fund. xiii Small Cap Growth Fund Investment Seeks to provide maximum capital appreciation by Objective: investing primarily in a portfolio of equity securities of domestic companies. Under normal conditions, the Fund will be mainly invested in common stocks or warrants of emerging growth companies that represent attractive opportunities for maximum capital appreciation. Subadvisor: Credit Suisse Asset Management/Warburg Pincus ("CSAM") Portfolio Elizabeth B. Dater, Stephen P. Lurito Managers: Inception Date: January 6, 1998 [GRAPH] NAV 5.75% Sales Charge Russell 2000 Growth Jan-98 10,000 9,425 10,000 Jan-98 9,990 9,416 9,953 Feb-98 10,690 10,075 10,832 Mar-98 11,160 10,518 11,286 Apr-98 11,270 10,622 11,356 May-98 10,640 10,028 10,531 Jun-98 10,940 10,311 10,638 Jul-98 9,910 9,340 9,750 Aug-98 7,890 7,436 7,499 Sep-98 8,470 7,983 8,260 Oct-98 8,880 8,369 8,690 Nov-98 9,410 8,869 9,364 Dec-98 10,090 9,510 10,212 Jan-99 10,350 9,755 10,651 Feb-99 9,530 8,982 9,695 Mar-99 10,090 9,510 10,040 Apr-99 10,290 9,698 10,927 May-99 10,350 9,755 10,944 Jun-99 11,630 10,961 11,521 Jul-99 11,530 10,867 11,165 Aug-99 11,450 10,792 10,747 Sep-99 11,970 11,282 10,954 Oct-99 12,810 12,073 11,235 Nov-99 14,470 13,638 12,423 Dec-99 17,469 16,464 14,612 Jan-00 17,519 16,512 14,476 Feb-00 23,560 22,205 17,845 Mar-00 21,479 20,244 15,969 Apr-00 18,263 17,213 14,356 May-00 16,544 15,593 13,099 Jun-00 20,052 18,899 14,792 Jul-00 17,911 16,881 13,524 Aug-00 20,746 19,553 14,946 Sep-00 19,650 18,520 14,204 Oct-00 18,398 17,340 13,051 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2000 ------ --------- ------------ Russell 2000 Growth Index 16.16% 9.91% 30.51% Small Cap Growth Fund Class A (NAV) 43.62% 24.14% 83.98% Small Cap Growth Fund Class A (net of 5.75% sales charge) 35.36% 21.56% 73.40% Small Cap Growth Fund Class B (NAV) 42.62% 23.01% 79.28% Small Cap Growth Fund Class B (net of CDSC)/1/ 37.62% 22.03% 75.28% Small Cap Growth Fund Class C (NAV) 42.54% 22.98% 79.17% Small Cap Growth Fund Class C (net of CDSC)/2/ 41.54% 22.98% 79.17% Small Cap Growth Fund Institutional Class I/3/ N/A -7.34% -7.34%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/10/2000. xiv Portfolio Managers' Commentary The Small Cap Growth Fund Class A share performance for the year-ended October 31, 2000 was 43.62%, significantly outperforming the Russell 2000 Growth Index return of 16.16%. The fourth quarter of 1999 was a spectacular one for small company growth stocks, with technology and communications shares displaying particular strength. Despite a rise in bond yields, the group outperformed large-cap stocks by a healthy margin, supported by optimism regarding smaller companies' earnings prospects and by investors' dissipating worries over the Y2K computer bug and attendant risk factors. This momentum continued in the beginning of the New Year although its strength made a dramatic reversal in March as significant valuation disparities between technology and non-technology companies signaled a wringing out of speculative excess. Following two quarters of solid performance, small cap growth stocks retreated during the second quarter, caused by continued uncertainty regarding the future course of monetary policy. Small-capitalization stocks continued to struggle in the third quarter, hampered by growing profit uncertainties that restrained stocks broadly. While fears of rising interest rates subsided, evidence of a slowing economy began to weigh on the market. Adding to the pressure was an upward spike in oil prices and a declining euro. As in the large-cap area, technology and communications stocks led the decline. Certain "defensive" sectors such as health care, performed well, as did value-type stocks generally. The most noteworthy change in the Fund's sector allocation during the third quarter of 2000 was a significant increase in its health care exposure (health care stocks accounted for about 25% of the Fund as of September 30, including pharmaceutical stocks). Companies we purchased included both service providers and more-aggressive biotechnology companies. On the service side, we deemed certain managed-care and hospital names to be attractive, based in part on the industry's overall supportive fundamentals. In addition, while the group's earnings-growth prospects are relatively modest, these companies have good potential to meet expectations over the near-to-intermediate term. We believe that investors will continue to reward companies that can deliver such consistency. In the pharmaceutical/biotech area, we added several companies that stand to benefit over the longer term from breakthroughs in gene research and the launch of new products. We maintained a modest overweighting in technology stocks, defined to include telecommunications, electronics and computer companies (combined, these sectors accounted for roughly 41% of the Fund at the end of the third quarter). While the group could continue to be hampered over the next few months by growth uncertainties, (e.g., in the cellular-handset area), we have a positive long-term outlook on these stocks and on "wireless" names in particular. Elsewhere of note, we remained modestly overweighted in the energy area, where we continued to emphasize oil-services providers. We believe these companies will continue to benefit from demand for their services, even if oil prices begin to decline. In our view, oil prices would have to fall dramatically to throttle activity in the oil-services industry. Despite the recent weakness in small caps, and the potential for choppy waters over the near term, we have a positive longer-term outlook on the group. We remain of the view that these stocks - and the group's growth-oriented names in particular - will benefit in due course from a historically supportive combination of benign inflation, relatively stable interest rates and modest economic growth. In addition, small caps currently trade at compelling valuations versus those of larger-cap stocks, which should only add to their appeal from a risk-reward perspective. xv Small Cap Index Fund Investment Seeks to provide investment results that are similar to Objective: the total return of the Russell 2000 Index. The Index is a sub-index of the Russell 3000 Index, which follows the 3,000 largest U.S. based companies based on total market capitalization. The Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, and represents about 8% of the total market capitalization of the Russell 3000 Index. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Magali Azema-Barac Manager: Inception Date: November 2, 1998/3/ [GRAPH] NAV 5.75% Sales Charge Russell 2000 Nov-98 10,000 9,425 10,000 Nov-98 10,370 9,774 10,524 Dec-98 10,977 10,345 11,175 Jan-99 11,104 10,465 11,324 Feb-99 10,242 9,653 10,406 Mar-99 10,352 9,757 10,569 Apr-99 11,219 10,574 11,516 May-99 11,409 10,753 11,684 Jun-99 11,851 11,170 12,213 Jul-99 11,561 10,897 11,877 Aug-99 11,129 10,489 11,438 Sep-99 11,088 10,451 11,440 Oct-99 11,132 10,492 11,487 Nov-99 11,748 11,072 12,173 Dec-99 12,990 12,243 13,551 Jan-00 12,684 11,955 13,333 Feb-00 14,497 13,663 15,535 Mar-00 13,507 12,730 14,510 Apr-00 12,739 12,007 13,637 May-00 11,947 11,260 12,842 Jun-00 12,918 12,175 13,962 Jul-00 12,516 11,796 13,513 Aug-00 13,439 12,667 14,544 Sep-00 13,014 12,266 14,116 Oct-00 12,439 11,724 13,486 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2000/3/ ------ --------- ------------ Russell 2000 Index 17.41% 16.15% 34.86% Small Cap Index Fund Class A (NAV) 11.74% 11.55% 24.39% Small Cap Index Fund Class A (net of 5.75% sales charge) 5.31% 8.29% 17.24% Small Cap Index Fund Class B (NAV) 10.83% 10.69% 22.49% Small Cap Index Fund Class B (net of CDSC)/1/ 5.83% 8.41% 17.49% Small Cap Index Fund Class C (NAV)/4/ N/A -3.07% -3.07% Small Cap Index Fund Class C (net of CDSC)/2/ N/A -3.98% -3.98%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July, 7 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. /4/Inception date is 8/23/00. xvi Portfolio Manager's Commentary The Small Cap Index Fund Class A share performance for the year-ended October 31, 2000 was 11.74% as compared to the Russell 2000 Index return of 17.41%. The increased volatility in the equity markets was felt the strongest in the small cap sector. While the small cap index showed gains of 17% in February 2000, the same index was down -6.59% the following month. This pattern of market ups and downs continued through the fiscal year. In addition to the volatility within the small cap sector itself, the small cap universe faced added volatility due to liquidity shortages brought about by the extreme spread in returns between small caps and the large caps. In general, we expect volatility to continue throughout next year, especially with the introduction of Regulation FD (Fair Disclosure) by the SEC. This regulation may generate more earnings surprises from public companies, as financial analysts at Wall Street firms receive less timely information from these companies and must begin playing on the same level as other investors. xvii Socially Responsible Fund Investment Seeks to obtain growth of capital by investing at least Objective: 80% of the Fund's total assets in the equity securities of companies meeting social criteria established for the Fund. To determine which companies meet the Fund's social criteria, AGIM relies on industry classifications and research services such as the Investor Responsibility Research Center. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Magali Azema-Barac Manager: Inception Date: November 2, 1998/4/ [GRAPH] NAV 5.75% Sales Charge S&P 500 Nov-98 10,000 9,425 10,000 Nov-98 10,450 9,849 10,606 Dec-98 11,042 10,407 11,217 Jan-99 11,430 10,773 11,685 Feb-99 11,139 10,499 11,323 Mar-99 11,550 10,886 11,775 Apr-99 11,994 11,304 12,231 May-99 11,713 11,039 11,943 Jun-99 12,305 11,598 12,605 Jul-99 11,881 11,197 12,213 Aug-99 11,760 11,084 12,152 Sep-99 11,448 10,789 11,819 Oct-99 12,253 11,548 12,567 Nov-99 12,445 11,729 12,823 Dec-99 13,063 12,312 13,577 Jan-00 12,421 11,707 12,895 Feb-00 12,253 11,548 12,551 Mar-00 13,335 12,569 13,889 Apr-00 12,842 12,104 13,471 May-00 12,506 11,786 13,194 Jun-00 12,769 12,034 13,520 Jul-00 12,642 11,915 13,309 Aug-00 13,366 12,597 14,135 Sep-00 12,617 11,891 13,389 Oct-00 12,564 11,842 13,332 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Periods Ending October 31, 2000/4/ Year Inception Inception ------ --------- ------------ S&P 500 Index 6.09% 15.49% 33.32% Socially Responsible Fund Class A (NAV) 2.54% 12.11% 25.64% Socially Responsible Fund Class A (net of 5.75% sales charge) -3.36% 8.83% 18.42% Socially Responsible Fund Class B (NAV) 1.88% 11.27% 23.78% Socially Responsible Fund Class B (net of CDSC)/1/ -3.12% 9.00% 18.78% Socially Responsible Fund Class C (NAV)/3/ N/A -0.11% -0.11% Socially Responsible Fund Class C (net of CDSC)/2/,/3/ N/A -1.11% -1.11% Socially Responsible Fund Institutional Class I 2.72% 12.30% 26.07%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/28/2000. /4/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xviii Portfolio Manager's Commentary The Socially Responsible Fund performance for the year ending October 31, 2000 was 2.54%, as compared to the S&P 500 index return of 6.09%. In line with its social mandate, the fund generally underweights its energy position vs. the energy weighting within the S&P 500 Index. Although this underweighting has been detrimental to short term returns over the past six months, we believe the current health care sector overweighting (vs. the S&P 500 Index weighting) will help the Fund going forward into the new fiscal year. After performing strongly for the fiscal year in 1999, the large cap equity market in the fiscal year 2000 suffered from an increase in volatility, finishing the year with a return of approximately 6%. This volatility is apparent when you look at the monthly returns of the S&P 500 over this period. For example, in December 1999 the S&P 500 returned 5.99% followed by a -5.02% in January 2000. To magnify the issue, the volatility phenomenon has been particularly strong in the technology sector, which constitutes more than 25% of the large cap market. The fiscal year ending October 31, 2000 also saw a reversal of the growth versus value dominance. During 1999 growth was the dominant theme in large caps, with a return of 25% over value. However, with uncertainty in the markets and in the earnings capacity of growth oriented technology stocks being questioned, value took over as the dominant style and outperformed growth by 11.88% for the first three quarter's in 2000. xix Stock Index Fund Investment Seeks to provide investment results that are similar to Objective: the total return of the S&P 500 Index. The Index is composed of 500 common stocks chosen by Standard & Poor's, and approximates the general distribution of industries in the U.S. economy and captures the price performance of a large cross-section of the publicly traded stock market. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Magali Azema-Barac Managers: Inception Date: November 2, 1998/4/ [GRAPH] NAV 5.75% Sales Charge S&P 500 Nov-98 10,000 9,425 10,000 Nov-98 10,530 9,925 10,606 Dec-98 11,116 10,477 11,217 Jan-99 11,559 10,894 11,685 Feb-99 11,198 10,554 11,323 Mar-99 11,639 10,970 11,775 Apr-99 12,084 11,389 12,231 May-99 11,853 11,172 11,943 Jun-99 12,495 11,777 12,605 Jul-99 12,111 11,415 12,213 Aug-99 12,051 11,358 12,152 Sep-99 11,699 11,026 11,819 Oct-99 12,436 11,721 12,567 Nov-99 12,658 11,930 12,823 Dec-99 13,382 12,612 13,577 Jan-00 12,709 11,978 12,895 Feb-00 12,454 11,738 12,651 Mar-00 13,666 12,880 13,889 Apr-00 13,236 12,475 13,471 May-00 12,960 12,215 13,194 Jun-00 13,256 12,494 13,520 Jul-00 13,032 12,282 13,309 Aug-00 13,835 13,039 14,135 Sep-00 13,098 12,345 13,389 Oct-00 13,047 12,297 13,332 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ Since Since Periods Ending October 31, 2000/4/ 1 Year Inception Inception ------ --------- ------------ S&P 500 Index 6.09% 15.49% 33.32% Stock Index Fund Class A (NAV) 4.91% 14.24% 30.47% Stock Index Fund Class A (net of 5.75% sales charge) -1.12% 10.91% 22.97% Stock Index Fund Class B (NAV) 4.21% 13.03% 27.70% Stock Index Fund Class B (net of CDSC)/1/ -0.79% 10.79% 22.70% Stock Index Fund Class C (NAV)/3/ N/A -5.21% -5.21% Stock Index Fund Class C (net of CDSC)/2/,/3/ N/A -6.16% -6.16%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/28/2000. /4/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xx Portfolio Managers' Commentary The Stock Index Fund Class A share performance for the year-ended October 31, 2000 was 4.91% as compared to the S&P 500 Index return of 6.09%. After performing strongly for the fiscal year in 1999, the large cap equity market in the fiscal year 2000 suffered from an increase in volatility, finishing the year with a return of approximately 6%. This volatility is apparent when you look at the monthly returns of the S&P 500 over this period. For example, in December 1999 the S&P 500 returned 5.99% followed by a -5.02% in January 2000. To magnify the issue, the volatility phenomenon has been particularly strong in the technology sector, which constitutes more than 25% of the large cap market. The fiscal year ending October 31, 2000 also saw a reversal of the growth versus value dominance. During 1999 growth was the dominant theme in large caps, with a return of 25% over value. However, with uncertainty in the markets and in the earnings capacity of growth oriented technology stocks being questioned, value took over as the dominant style and outperformed growth by 11.88% for the first three quarter's in 2000. xxi Global Equity Fund Investment Seeks to provide long-term capital appreciation by Objective: investing primarily in a globally diversified portfolio of growth equity securities. Subadvisor: Founders Asset Management LLC ("Founders") Portfolio Douglas A. Loeffler, Scott Chapman, Tom Arrington Managers: Inception Date: November 1, 1990/4/ [GRAPH] NAV 5.75% Sales Charge MSCI World Index Oct-90 10,000 9,425 10,000 Nov-90 9,921 9,350 9,838 Dec-90 10,024 9,448 10,046 Jan-91 10,272 9,682 10,415 Feb-91 10,927 10,298 11,381 Mar-91 10,629 10,018 11,047 Apr-91 10,659 10,046 11,136 May-91 10,847 10,224 11,390 Jun-91 10,233 9,645 10,688 Jul-91 10,698 10,083 11,195 Aug-91 10,597 9,988 11,161 Sep-91 10,719 10,102 11,456 Oct-91 10,880 10,255 11,644 Nov-91 10,466 9,864 11,138 Dec-91 11,161 10,519 11,951 Jan-92 11,141 10,500 11,733 Feb-92 11,181 10,538 11,532 Mar-92 10,725 10,108 10,991 Apr-92 11,049 10,414 11,146 May-92 11,587 10,921 11,592 Jun-92 11,252 10,605 11,206 Jul-92 11,049 10,414 11,237 Aug-92 11,060 10,424 11,513 Sep-92 10,776 10,156 11,409 Oct-92 10,491 9,888 11,102 Nov-92 10,836 10,213 11,303 Dec-92 10,841 10,218 11,397 Jan-93 10,871 10,246 11,437 Feb-93 11,004 10,371 11,710 Mar-93 11,633 10,965 12,392 Apr-93 12,243 11,539 12,968 May-93 12,843 12,104 13,269 Jun-93 12,710 11,980 13,160 Jul-93 13,036 12,286 13,434 Aug-93 13,716 12,928 14,052 Sep-93 13,757 12,966 13,794 Oct-93 13,960 13,157 14,176 Nov-93 13,117 12,363 13,377 Dec-93 14,046 13,238 14,034 Jan-94 14,920 14,062 14,961 Feb-94 14,982 14,120 14,770 Mar-94 14,529 13,694 14,136 Apr-94 14,910 14,052 14,576 May-94 14,684 13,839 14,615 Jun-94 14,848 13,994 14,577 Jul-94 15,177 14,304 14,857 Aug-94 15,640 14,741 15,307 Sep-94 15,074 14,207 14,908 Oct-94 15,239 14,363 15,334 Nov-94 14,272 13,452 14,672 Dec-94 14,256 13,436 14,817 Jan-95 13,459 12,685 14,598 Feb-95 13,459 12,685 14,806 Mar-95 13,969 13,166 15,517 Apr-95 14,288 13,466 16,074 May-95 14,330 13,506 16,214 Jun-95 14,298 13,476 16,212 Jul-95 15,095 14,227 17,026 Aug-95 14,999 14,137 16,650 Sep-95 15,137 14,267 17,138 Oct-95 14,702 13,856 16,870 Nov-95 14,819 13,967 17,459 Dec-95 15,266 14,388 17,973 Jan-96 15,395 14,510 18,301 Feb-96 15,546 14,652 18,417 Mar-96 15,934 15,018 18,722 Apr-96 16,495 15,546 19,166 May-96 16,312 15,374 19,185 Jun-96 16,279 15,343 19,285 Jul-96 15,309 14,429 18,606 Aug-96 15,622 14,723 18,824 Sep-96 15,719 14,815 19,564 Oct-96 15,632 14,734 19,696 Nov-96 16,646 15,689 20,796 Dec-96 17,007 16,029 20,459 Jan-97 17,043 16,063 20,702 Feb-97 17,490 16,485 20,936 Mar-97 17,345 16,348 20,518 Apr-97 17,551 16,541 21,185 May-97 18,734 17,657 22,489 Jun-97 19,652 18,522 23,607 Jul-97 20,462 19,285 24,690 Aug-97 19,447 18,329 23,034 Sep-97 20,534 19,353 24,282 Oct-97 19,713 18,579 23,000 Nov-97 19,809 18,670 23,403 Dec-97 20,500 19,321 23,684 Jan-98 20,552 19,370 24,341 Feb-98 22,172 20,897 25,983 Mar-98 23,453 22,104 27,076 Apr-98 23,570 22,215 27,337 May-98 23,348 22,006 26,990 Jun-98 23,074 21,747 27,627 Jul-98 22,721 21,415 27,578 Aug-98 19,128 18,028 23,896 Sep-98 19,755 18,619 24,315 Oct-98 21,467 20,232 26,509 Nov-98 22,277 20,996 28,081 Dec-98 22,809 21,498 29,448 Jan-99 22,640 21,339 30,090 Feb-99 21,572 20,331 29,287 Mar-99 21,951 20,689 30,502 Apr-99 23,414 22,067 31,701 May-99 23,034 21,710 30,538 Jun-99 23,751 22,386 31,958 Jul-99 23,906 22,531 31,859 Aug-99 23,653 22,293 31,798 Sep-99 22,584 21,285 31,486 Oct-99 22,668 21,365 33,105 Nov-99 22,992 21,670 34,032 Dec-99 23,476 22,126 36,782 Jan-00 22,391 21,104 34,672 Feb-00 21,760 20,508 34,761 Mar-00 21,889 20,631 37,160 Apr-00 19,558 18,433 35,584 May-00 18,635 17,563 34,679 Jun-00 19,946 18,799 35,842 Jul-00 19,153 18,052 34,829 Aug-00 20,157 18,998 35,958 Sep-00 18,829 17,747 34,042 Oct-00 17,890 16,861 33,467 Performance Table
Cumulative Average Annual Total Return Total Return --------------------------------- ------------------ 1 5 Since Since/4/ Since Since/4/ Periods Ending October Year Years Inception 3/13/00 Inception 3/13/00 31, 2000 ------- ------ --------- -------- --------- -------- MSCI World Index/1/ 1.09% 15.03% 12.49% -9.78% 224.56% -9.78% Global Equity Fund Class A (NAV) -21.08% 4.00% 5.99% -17.23% 78.90% -17.23% Global Equity Fund Class A (net of 5.75% sales charge) -25.62% 2.78% 5.36% -21.99% 68.61% -21.99% Global Equity Fund Class B (NAV) -21.44% 3.44% 5.62% -17.41% 72.74% -17.41% Global Equity Fund Class B (net of CDSC)/2/ -25.37% 3.09% 5.62% -21.54% 72.74% -21.54% Global Equity Fund Class C (NAV) -21.42% 3.45% 5.62% -17.34% 72.79% -17.34% Global Equity Fund Class C (net of CDSC)/3/ -22.20% 3.45% 5.62% -18.17% 72.79% -18.17%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Current investment subadvisor assignment became effective 3/13/00. xxii Portfolio Managers' Commentary For the fiscal year ended October 31, 2000, the NAF Global Equity Fund's Class A shares had an annual return of -21.08%, compared to the unmanaged MSCI World Index's return of 1.09%. A change in the Fund's management occurred midway through the period between November 1, 1999 and October 31, 2000. This led to greater emphasis on telecommunication and technology stocks, which we invested in heavily right as the market was peaking in March. Unfortunately, this caused the Fund to underperform its peers, as these sectors were subsequently hit by heavy profit-taking. We've also experienced the ill effects of a weak euro--which has resulted in declining rates of return when converting the euro assets in the Fund into U.S. dollars--rising oil prices, and the underperformance of growth-oriented stocks relative to value-oriented stocks. Part of the NAF Global Equity Portfolio's performance is due to the Fund's purchase of securities sold in initial public offerings (IPOs). There is no guarantee that the Fund's investments in IPOs, if any, will continue to have a similar impact on performance. We have been pleased, however, to see strong earnings reports from most companies in the Fund. Also, we've been taking advantage of price volatility. While we can't help being affected by falls in growth stocks globally, we have been striving to add value to the portfolio by initiating or increasing positions in strong companies at attractive valuations. Using this strategy, we've been modestly increasing our weightings in areas such as semiconductors and telecommunications equipment, where we think stocks have over-reacted to the downside. And, as always, we continue to emphasize companies from around the globe with demonstrated track records of sustainable earnings growth and considerable competitive advantages that we believe will endure over time. xxiii International Equity Fund Investment Seeks to provide long-term capital appreciation by Objective: investing primarily in accordance with country and sector weightings determined by MSAM in equity securities of non-U.S. issuers which, in the aggregate, replicate broad market indices. Subadvisor: Morgan Stanley Asset Management ("MSAM") Portfolio Barton M. Biggs, Ann Thievierge Managers: Inception Date: January 9, 1995/4/ [GRAPH] NAV 5.75% Sales Charge MSCI All Country U.S.MSCA EAFE 1/9/95 10,000 9,425 10,000 10,000 1/31/95 9,800 9,237 9,605 9,616 2/28/95 9,590 9,039 9,599 9,588 3/31/95 10,030 9,453 10,190 10,186 4/30/95 10,350 9,755 10,566 10,569 5/30/95 10,150 9,566 10,460 10,443 6/30/95 9,977 9,403 10,290 10,260 7/31/95 10,488 9,885 10,913 10,899 8/31/95 10,228 9,639 10,512 10,483 9/30/95 10,308 9,715 10,708 10,688 10/31/95 10,137 9,554 10,428 10,401 11/30/95 10,338 9,743 10,721 10,690 12/31/95 10,786 10,165 11,141 11,121 1/31/96 10,888 10,262 11,206 11,166 2/29/96 10,857 10,233 11,239 11,204 3/31/96 11,041 10,406 11,477 11,442 4/30/96 11,265 10,617 11,816 11,775 5/31/96 11,235 10,589 11,614 11,558 6/30/96 11,367 10,714 11,664 11,623 7/31/96 11,102 10,464 11,322 11,283 8/31/96 11,214 10,569 11,365 11,308 9/30/96 11,510 10,848 11,673 11,609 10/31/96 11,581 10,916 11,595 11,490 11/30/96 12,010 11,319 12,073 11,947 12/31/96 12,093 11,397 11,906 11,793 1/31/97 11,849 11,167 11,535 11,380 2/28/97 11,926 11,241 11,710 11,567 3/31/97 12,004 11,314 11,721 11,609 4/30/97 11,993 11,303 11,793 11,670 5/31/97 12,503 11,784 12,571 12,430 6/30/97 12,947 12,203 13,242 13,115 7/31/97 13,091 12,339 13,485 13,327 8/31/97 12,270 11,565 12,492 12,332 9/30/97 12,736 12,004 13,193 13,023 10/31/97 11,993 11,303 12,198 12,022 11/30/97 11,838 11,157 12,062 11,899 12/31/97 12,036 11,344 12,176 12,003 1/30/98 12,368 11,657 12,695 12,552 2/27/98 13,166 12,409 13,522 13,357 3/31/98 13,707 12,919 13,966 13,769 4/30/98 13,940 13,139 14,075 13,878 5/31/98 13,756 12,965 14,001 13,810 6/30/98 13,559 12,780 14,076 13,915 7/31/98 13,608 12,826 14,168 14,056 8/31/98 11,312 10,661 12,358 12,314 9/30/98 10,771 10,152 12,005 11,937 10/31/98 12,073 11,379 13,255 13,181 11/30/98 12,712 11,981 13,927 13,856 12/31/98 13,022 12,273 14,461 14,403 1/31/99 13,219 12,459 14,464 14,361 2/28/99 12,837 12,099 14,100 14,018 3/31/99 13,601 12,819 14,688 14,604 4/30/99 14,032 13,225 15,318 15,195 5/31/99 13,305 12,540 14,544 14,413 6/30/99 13,823 13,028 15,113 14,975 7/31/99 14,143 13,330 15,548 15,420 8/31/99 14,192 13,376 15,592 15,476 9/30/99 14,266 13,446 15,760 15,632 10/31/99 14,648 13,806 16,369 16,217 11/30/99 15,239 14,363 16,942 16,781 12/31/99 16,706 15,745 18,500 18,287 1/31/00 15,486 14,596 17,376 17,125 2/29/00 15,996 15,076 17,868 17,586 3/31/00 16,384 15,442 18,601 18,268 4/28/00 15,473 14,583 17,637 17,306 5/31/00 15,205 14,331 17,209 16,884 6/30/00 15,580 14,684 17,953 17,544 7/31/00 14,776 13,927 17,267 16,808 8/31/00 15,058 14,192 17,492 16,954 9/29/00 14,482 13,649 16,586 16,129 10/31/00 14,053 13,245 16,134 15,748 Performance Table
Cumulative Average Annual Total Return Total Return -------------------------------- ------------------- 1 5 Since Since Since Since Periods Ending October 31, Year Years Inception 4/1/99/4/ Inception 4/1/99/4/ 2000 ------ ----- --------- --------- --------- --------- MSCI EAFE Index/3/ -2.90% 8.65% 8.12% 4.87% 57.48% 7.84% MSCI All Country World ex U.S. Index/6/ -1.44% 9.12% 8.58% 6.10% 61.34% 9.84% International Equity Fund Class A (NAV) -4.00% 6.75% 6.03% 2.08% 40.53% 3.33% International Equity Fund Class A (net of 5.75% sales charge) -9.58% 5.49% 4.95% -1.66% 32.45% -2.63% International Equity Fund Class B (NAV) -4.78% 6.05% 5.41% 1.36% 35.83% 2.17% International Equity Fund Class B (net of CDSC)/1/ -9.29% 5.73% 5.27% -1.79% 34.83% -2.83% International Equity Fund Class C (NAV) -5.05% 5.97% 5.34% 1.18% 35.34% 1.88% International Equity Fund Class C (net of CDSC)/2/ -5.96% 5.97% 5.34% 1.18% 35.34% 1.88% International Equity Fund Institutional Class 1/3/ N/A N/A -10.82% -10.82% -10.82% -10.82%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/10/2000. /4/Current investment subadvisor assignment became effective 4/1/99. /5/The benchmark became MSCI EAFE Index on 4/1/99 when Morgan Stanley Asset Management assumed management of the Fund. /6/All since-inception returns for indices begin on the month-end closest to the actual inception date of the fund. xxiv Portfolio Managers' Commentary The International Equity Fund Class A share performance for the year-ended October 31, 2000 was -4.00% as compared to the MSCI EAFE Index return of - 2.90%. The same trends of technology and communications that drove the equity markets in the U.S., along with an overall theme of restructuring throughout the rest of the world, led equity markets in both Europe and Asia to increase in both the end of 1999 and in the beginning of 2000. However, as the U.S. markets began to deteriorate because of strong energy prices, a weak euro, weaker than expected corporate earnings and interest rate increases in the second quarter of 2000, the non-U.S. market followed. The second half of the fiscal year ending October 31, 2000 was particularly volatile. The value sectors of the markets continued to offer some protection to investors relative to the continued sharp sell off in the growth sectors. We believe that global economic growth peaked over the summer as the result of central bank tightenings, higher energy costs and the NASDAQ. The U.S. economic slowdown has been more biting than the markets had anticipated, and we are concerned about the effect on corporate profit growth as a result. In Japan, economic growth is anemic and the outlook of fiscal spending for next year is questionable, which has for some time provided a floor to the economy. During the second half of the fiscal year-ended October 31, 2000 we scaled back our position in Japan and are now neutral relative to our benchmark. In Europe we are now neutrally weighted in the U.K. and overweight in Switzerland. We added to our positions in both markets as they offer good relative value and have high defensive sector weightings (financials and pharmaceuticals, low exposure to technology). In the U.K. we believe that short-term interest rates are near their peak and the weakening of the sterling relative to the euro should provide some relief to the manufacturing sector. In addition, euro intervention has been effective so far and tax reform has been positive, but the economic bite from 225 basis points of short-term interest rate increases since November 1999 could be harsher than expected. In sum, we are wary about the global economic outlook and have raised some cash as we look for safe havens in the global market turmoil. We continue to underweight the Technology, Media and Telecom sectors - despite noticeably better valuations. The implication for a global economic slowdown is that we can no longer expect strong growth to sustain a healthy advance in earnings. Corporate earnings are leveraged to growth and the leverage works on the upside as well as the downside. To us, most global equity valuations still appear extended and reliant on enthusiastic forward earnings estimates. xxv International Small Cap Fund Investment Seeks to provide long-term capital appreciation by Objective: investing primarily in equity securities issued by foreign companies that have total market capitalization or annual revenue of $1 billion or less. Subadvisor: Founders Asset Management LLC ("Founders") Portfolio Tracy P. Stouffer Manager: Inception Date: March 4, 1996 [GRAPH] NAV 5.75% Sales Charge MSCI World EX US Index Mar-96 10,000 9,425 10,000 Mar-96 10,224 9,636 10,212 Apr-96 10,552 9,945 10,513 May-96 10,760 10,141 10,334 Jun-96 10,776 10,156 10,379 Jul-96 10,368 9,772 10,075 Aug-96 10,440 9,840 10,113 Sep-96 10,536 9,930 10,387 Oct-96 10,744 10,126 10,317 Nov-96 10,928 10,300 10,743 Dec-96 11,040 10,405 10,594 Jan-97 11,144 10,503 10,263 Feb-97 11,352 10,699 10,419 Mar-97 11,312 10,662 10,430 Apr-97 11,016 10,383 10,494 May-97 11,520 10,858 11,185 Jun-97 11,680 11,008 11,783 Jul-97 11,632 10,963 11,999 Aug-97 11,176 10,533 11,115 Sep-97 11,608 10,941 11,739 Oct-97 11,088 10,450 10,854 Nov-97 11,152 10,511 10,732 Dec-97 11,000 10,368 10,834 Jan-98 11,256 10,609 11,296 Feb-98 11,832 11,152 12,032 Mar-98 12,560 11,838 12,427 Apr-98 12,896 12,154 12,523 May-98 13,376 12,607 12,458 Jun-98 13,376 12,607 12,524 Jul-98 13,368 12,599 12,606 Aug-98 11,344 10,692 10,996 Sep-98 10,664 10,051 10,682 Oct-98 11,128 10,488 11,794 Nov-98 11,608 10,941 12,392 Dec-98 12,120 11,423 12,867 Jan-99 12,536 11,815 12,870 Feb-99 11,920 11,235 12,546 Mar-99 12,488 11,770 13,069 Apr-99 13,040 12,290 13,630 May-99 12,576 11,853 12,941 Jun-99 13,104 12,351 13,447 Jul-99 13,592 12,810 13,834 Aug-99 13,720 12,931 13,874 Sep-99 14,320 13,497 14,023 Oct-99 15,064 14,198 14,565 Nov-99 19,496 18,375 15,075 Dec-99 23,567 22,212 16,461 Jan-00 24,863 23,433 15,461 Feb-00 32,035 30,193 15,899 Mar-00 27,125 25,565 16,551 Apr-00 22,117 20,846 15,693 May-00 20,087 18,932 15,313 Jun-00 21,373 20,144 15,974 Jul-00 20,542 19,360 15,364 Aug-00 21,963 20,700 15,564 Sep-00 20,638 19,452 14,758 Oct-00 18,579 17,511 14,356 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Periods Ending October 31, 2000 Year Inception Inception ------ --------- ------------ MSCI World ex US Index/3/ -1.44% 8.06% 43.56% International Small Cap Fund Class A (NAV) 23.34% 14.21% 85.79% International Small Cap Fund Class A (net of 5.75% sales charge) 16.24% 12.77% 75.11% International Small Cap Fund Class B (NAV) 22.16% 13.34% 79.33% International Small Cap Fund Class B (net of CDSC)/1/ 17.16% 13.07% 77.33% International Small Cap Fund Class C (NAV) 22.43% 13.42% 79.92% International Small Cap Fund Class C (net of CDSC)/2/ 21.43% 13.42% 79.92%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/All since-inception returns for indices begin on the month-end closest to the actual inception date of the fund. xxvi Portfolio Manager's Commentary For the fiscal year ended October 31, 2000, the International Small Cap Fund's Class A shares had an NAV total return of 23.34%, compared to the unmanaged MSCI World ex U.S. Index's decline of -1.44%. Significant macroeconomic events during the period between November 1, 1999 and October 31, 2000--such as the highly scrutinized NASDAQ's erratic behavior and a hefty rise in oil prices--helped trigger a sharp swing from investor confidence to widespread uncertainty. Before this swing, the Fund benefited in late 1999 and early 2000 from exceptionally strong stock performance, most notably from growth companies representing the technology sector. Japanese and other Asian companies were particularly strong contributors. Part of the International Small Cap Fund's performance is due to the Fund's purchase of securities sold in initial public offerings (IPOs). There is no guarantee that the Fund's investments in IPOs, if any, will continue to have a similar impact on performance. However, by mid-March the landscape had shifted. Investors began questioning the valuations of many technology companies, choosing to gravitate toward large companies with high liquidity rather than stay in the more volatile international small-cap arena. Furthermore, the euro's weakness resulted in declining rates of return when converting the euro assets in the Fund into U.S. dollars (the currency in which the Fund is priced), and the Japanese market lost ground even after it appeared to have reached bottom. The very types of companies that aided the Fund's performance prior to March--namely technology and Japanese firms--proved burdensome as the markets spiraled downward. In response, the team has been reducing the Fund's positions in technology and pursuing more attractive opportunities elsewhere. For example, the world's voracious appetite for energy shows no signs of weakening at this juncture, and therefore the team has added to the Fund's positions in the oil services sector. Healthcare stocks are also showing strong long-term growth potential, due in large part to the aging of the world's population. Meanwhile, the team remains dedicated to its bottom-up approach, which it continues to apply during these volatile times. xxvii Balanced Fund Investment Seeks to provide current income and capital appreciation Objective: by investing in a combination of common stocks and fixed- income securities, including preferred stocks, convertible securities and bonds. The Fund normally invests the majority of its total assets in U.S. and foreign growth-oriented common stocks and approximately 25% of its total assets in investment grade debt securities. Subadvisor: INVESCO Funds Group, Inc. ("INVESCO") Portfolio Charles Mayer, Jerry Paul, Peter Lovell Managers: Inception Date: August 28, 1989/5/ [GRAPH] 5.75% Sales S&P 500 LB Aggregate 50%/50% NAV Charge Index Bond Index Composite Index Oct-90 10,000 9,425 10,000 10,000 10,000 Nov-90 10,394 9,796 10,646 10,215 10,431 Dec-90 10,735 10,118 10,943 10,374 10,659 Jan-91 11,074 10,437 11,420 10,503 10,962 Feb-91 11,614 10,946 12,237 10,592 11,414 Mar-91 11,752 11,076 12,533 10,665 11,599 Apr-91 11,827 11,147 12,563 10,781 11,672 May-91 11,965 11,277 13,101 10,843 11,972 Jun-91 11,674 11,003 12,502 10,838 11,670 Jul-91 12,006 11,316 13,087 10,988 12,038 Aug-91 12,274 11,569 13,395 11,226 12,310 Sep-91 12,249 11,545 13,175 11,454 12,314 Oct-91 12,453 11,737 13,351 11,581 12,466 Nov-91 12,287 11,581 12,812 11,687 12,250 Dec-91 13,037 12,288 14,276 12,034 13,155 Jan-92 13,102 12,348 14,011 11,871 12,941 Feb-92 13,411 12,640 14,190 11,948 13,069 Mar-92 13,231 12,470 13,912 11,881 12,896 Apr-92 13,450 12,676 14,317 11,966 13,142 May-92 13,720 12,931 14,394 12,193 13,293 Jun-92 13,514 12,737 14,186 12,361 13,273 Jul-92 13,814 13,020 14,757 12,613 13,685 Aug-92 14,968 14,108 14,459 12,740 13,600 Sep-92 13,746 12,956 14,625 12,892 13,759 Oct-92 13,855 13,058 14,678 12,721 13,699 Nov-92 14,398 13,570 15,173 12,723 13,948 Dec-92 14,718 13,872 15,371 12,925 14,148 Jan-93 14,870 14,015 15,484 13,174 14,329 Feb-93 14,801 13,950 15,693 13,404 14,548 Mar-93 15,202 14,328 16,030 13,460 14,745 Apr-93 14,912 14,054 15,637 13,555 14,596 May-93 15,175 14,302 16,060 13,572 14,816 Jun-93 15,396 14,511 16,113 13,818 14,965 Jul-93 15,548 14,654 16,037 13,897 14,967 Aug-93 15,714 14,810 16,648 14,140 15,394 Sep-93 15,880 14,967 16,525 14,178 15,351 Oct-93 15,935 15,019 16,860 14,230 15,545 Nov-93 15,852 14,941 16,702 14,110 15,406 Dec-93 16,200 15,269 16,907 14,186 15,546 Jan-94 16,503 15,554 17,473 14,377 15,925 Feb-94 16,489 15,540 17,002 14,127 15,564 Mar-94 15,955 15,037 16,262 13,778 15,020 Apr-94 15,897 14,983 16,473 13,668 15,071 May-94 15,940 15,024 16,742 13,667 15,204 Jun-94 15,738 14,833 16,328 13,636 14,982 Jul-94 15,969 15,051 16,869 13,908 15,388 Aug-94 16,416 15,472 17,555 13,925 15,740 Sep-94 16,214 15,282 17,132 13,720 15,426 Oct-94 16,056 15,133 17,525 13,707 15,616 Nov-94 15,551 14,657 16,882 13,677 15,279 Dec-94 15,762 14,856 17,128 13,772 15,450 Jan-95 15,903 14,988 17,573 14,044 15,809 Feb-95 16,637 15,680 18,255 14,379 16,317 Mar-95 16,887 15,916 18,796 14,466 16,631 Apr-95 17,231 16,240 19,343 14,669 17,006 May-95 17,777 16,755 20,107 15,237 17,672 Jun-95 18,012 16,976 20,579 15,348 17,963 Jul-95 18,324 17,271 21,264 15,314 18,289 Aug-95 18,637 17,565 21,322 15,499 18,411 Sep-95 18,887 17,801 22,215 15,650 18,932 Oct-95 18,777 17,698 22,137 15,853 18,995 Nov-95 19,199 18,095 23,111 16,091 19,601 Dec-95 19,601 18,474 23,539 16,316 19,928 Jan-96 19,843 18,702 24,339 16,427 20,383 Feb-96 19,894 18,750 24,566 16,141 20,353 Mar-96 19,894 18,750 24,801 16,028 20,415 Apr-96 19,946 18,799 25,166 15,939 20,552 May-96 20,135 18,978 25,815 15,907 20,861 Jun-96 20,118 18,961 25,913 16,120 21,017 Jul-96 19,911 18,767 24,768 16,163 20,466 Aug-96 20,170 19,010 25,291 16,136 20,713 Sep-96 20,790 19,594 26,715 16,417 21,566 Oct-96 21,238 20,017 27,452 16,781 22,116 Nov-96 21,961 20,698 29,527 17,068 23,298 Dec-96 21,728 20,479 28,943 16,909 22,926 Jan-97 22,301 21,019 30,751 16,962 23,857 Feb-97 22,262 20,982 30,991 17,004 23,998 Mar-97 21,867 20,609 29,718 16,815 23,267 Apr-97 22,558 21,261 31,489 17,068 24,278 May-97 23,427 22,080 33,403 17,230 25,317 Jun-97 24,158 22,769 34,900 17,435 26,167 Jul-97 24,889 23,458 37,674 17,906 27,790 Aug-97 24,059 22,676 35,565 17,753 26,659 Sep-97 25,067 23,625 37,510 18,016 27,763 Oct-97 24,849 23,420 36,257 18,277 27,267 Nov-97 25,146 23,700 37,936 18,361 28,149 Dec-97 25,454 23,990 38,588 18,547 28,568 Jan-98 26,135 24,632 39,017 18,784 28,900 Feb-98 26,962 25,412 41,830 18,769 30,299 Mar-98 27,473 25,894 43,971 18,833 31,402 Apr-98 27,717 26,123 44,416 18,931 31,673 May-98 27,571 25,985 43,652 19,111 31,381 Jun-98 27,984 26,375 45,424 19,273 32,349 Jul-98 27,303 25,733 44,942 19,314 32,128 Aug-98 25,697 24,219 38,453 19,629 29,041 Sep-98 27,035 25,481 40,917 20,088 30,503 Oct-98 27,936 26,329 44,244 19,981 32,113 Nov-98 28,544 26,903 46,925 20,095 33,510 Dec-98 28,967 27,301 49,628 20,156 34,892 Jan-99 28,592 26,948 51,703 20,299 36,001 Feb-99 27,789 26,191 50,095 19,943 35,019 Mar-99 28,217 26,595 52,098 20,053 36,076 Apr-99 28,806 27,150 54,115 20,117 37,116 May-99 28,673 27,024 52,838 19,940 36,389 Jun-99 29,047 27,377 55,770 19,876 37,823 Jul-99 28,405 26,772 54,030 19,793 36,911 Aug-99 28,458 26,822 53,760 19,783 36,771 Sep-99 27,816 26,216 52,287 20,013 36,150 Oct-99 28,271 26,645 55,615 20,086 37,851 Nov-99 27,923 26,317 56,748 20,084 38,416 Dec-99 28,068 26,454 60,088 19,988 40,038 Jan-00 27,117 25,558 57,070 19,922 38,496 Feb-00 28,353 26,723 55,989 20,163 38,076 Mar-00 29,747 28,036 61,467 20,429 40,948 Apr-00 28,860 27,200 59,617 20,370 39,993 May-00 28,163 26,543 58,394 20,360 39,377 Jun-00 29,081 27,409 59,833 20,783 40,308 Jul-00 29,303 27,618 58,899 20,972 39,935 Aug-00 31,077 29,290 62,557 21,276 41,916 Sep-00 30,380 28,633 59,254 21,410 40,332 Oct-00 29,873 28,730 59,004 21,552 40,278 Performance Table
Average Annual Cumulative Total Return Total Return ------------------------------- ------------------ 1 5 10 Since 10 Since Periods Ending October 31, Year Years Years 3/13/00/5/ Years 3/13/00/5/ 2000 ------ ------ ------ ---------- ------- ---------- S&P 500 Index/1/ 6.09% 21.67% 19.44% -4.00% 490.04% -4.00% Lehman Brothers Aggregate Bond Index/1/ 7.30% 6.33% 7.98% 5.50% 115.52% 5.50% 50%/50% Composite/1/,/2/ 6.41% 13.02% 12.36% 0.45% 302.78% 0.45% Balanced Fund Class A (NAV) 5.67% 9.73% 11.56 2.06% 198.73% 2.06% Balanced Fund Class A (net of 5.75% sales charge) -0.41% 8.44% 11.12 -3.81% 187.30% -3.81% Balanced Fund Class B (NAV) 5.17% 9.07% 11.15 1.85% 187.99% 1.85% Balanced Fund Class B (net of CDSC)/3/ 0.17% 8.78% 11.15 -3.15% 187.99% -3.15% Balanced Fund Class C (NAV) 4.86% 9.00% 11.12% 1.50% 186.95% 1.50% Balanced Fund Class C (net of CDSC)/4/ 3.86% 9.00% 11.12% 0.50% 186.95% 0.50% Balanced Fund Institutional Class I/6/ N/A N/A N/A 1.07% 1.07% 1.07%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/Comprised of 50% of the return of the S&P 500 Index and 50% of the return of the Lehman Brothers Aggregate Bond Index. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /4/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /5/Current investment subadvisor assignment became effective 3/13/00. /6/Inception date is 7/10/2000. xxviii Portfolio Managers' Commentary Despite a high level of market volatility in the spring and fall, the Fund ended the period with a solid gain. The Balanced Fund Class A share performance for the year-ended October 31, 2000 was 5.67% as compared to the S&P 500 Index return of 6.09%. The Lehman Brothers Aggregate Bond Index returned 7.30% for the same time period. Both the bond and equity portions of the Fund contributed positively to returns. Many high-growth sectors, particularly telecommunications and technology, pulled back sharply in recent months. Nevertheless, the drop was not sharp enough to erase the significant gains we had recorded in many of our holdings in these areas. Our investment in the satellite television provider GM Hughes, for example, was significantly higher for the year, as was our holding in the semiconductor maker Maxim. On the other hand, with the notable exception of the German firm SAP, most of our software holdings were lower for the period. Several of our leading health care holdings were also strong performers, with pharmaceutical stocks Warner-Lambert (Pfizer) and Forest Labs advancing. Meanwhile, many of our investments in so-called "Old Economy" sectors moved higher. Our electric utility holdings flourished, as did many of our energy investments. Incumbent regional Bell telephone companies SBC Communications and Verizon Communications gained ground even as many long distance and wireless firms suffered. Our retailing holdings proved a disappointment, with even leading discounters such as Wal-Mart and Target moving lower in response to worries about a slowing economy. Our energy holdings were generally strong, with exploration and service firms benefiting most from signs that the sector was entering a long-term expansion cycle. In the fixed-income market, a pattern of peaking and then declining long-term government interest rates was offset partially by increased credit spreads between Treasury and corporate debt. Within the Fund's bond allocation, we maintained a roughly one-third exposure to electric utilities bonds. The de- leveraging and associated credit improvement achieved by many of our electric utility holdings validated our large allocation to the sector. Given the risk of additional market volatility, we believe investors will be well served by our broad industry diversification and our focus on high- quality companies. In this environment, we have reduced our total number of holdings to focus on those companies that earn our highest confidence. We believe this approach can help us provide consistent performance to our investors, in any kind of market. For the fixed-income portion of the Fund, we remain focused on credit risk analysis, and our themes of electric utilities' deregulation and special situations. Issue-specific security selection and/or avoidance will drive performance throughout the remainder of the year. xxix Core Bond Fund Investment Seeks a high level of current income consistent with the Objective: maintenance of principal and liquidity. To achieve this objective, AGIM invests at least 65% of the Fund's total assets in medium to high quality fixed-income securities, or in securities issued or guaranteed by the U.S. Government, mortgage-backed, or asset-backed securities. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Robert Kase Manager: Inception Date: May 1, 1991/5/ [GRAPH] 4.75% Sales LB Aggregate 50%/50% Composite NAV Charge Bond Index Index May-91 10,000 9,525 10,000 10,000 May-91 10,085 9,606 10,058 10,054 Jun-91 10,080 9,602 10,053 10,046 Jul-91 10,157 9,674 10,193 10,178 Aug-91 10,395 9,901 10,413 10,411 Sep-91 10,614 10,110 10,624 10,627 Oct-91 10,721 10,212 10,742 10,724 Nov-91 10,808 10,294 10,841 10,831 Dec-91 11,200 10,668 11,163 11,192 Jan-92 10,991 10,469 11,011 11,035 Feb-92 11,085 10,558 11,083 11,110 Mar-92 11,018 10,495 11,021 11,053 Apr-92 11,065 10,540 11,100 11,116 May-92 11,320 10,782 11,310 11,343 Jun-92 11,511 10,964 11,466 11,513 Jul-92 11,791 11,231 11,700 11,811 Aug-92 11,915 11,349 11,818 11,912 Sep-92 12,085 11,511 11,959 12,069 Oct-92 11,901 11,335 11,800 11,874 Nov-92 11,930 11,363 11,802 11,874 Dec-92 12,127 11,551 11,990 12,083 Jan-93 12,382 11,794 12,220 12,353 Feb-93 12,604 12,006 12,434 12,619 Mar-93 12,676 12,074 12,486 12,662 Apr-93 12,757 12,151 12,573 12,759 May-93 12,769 12,162 12,590 12,760 Jun-93 13,016 12,397 12,817 13,057 Jul-93 13,051 12,431 12,891 13,144 Aug-93 13,312 12,680 13,116 13,454 Sep-93 13,372 12,737 13,152 13,496 Oct-93 13,408 12,771 13,200 13,555 Nov-93 13,192 12,565 13,088 13,397 Dec-93 13,254 12,624 13,159 13,463 Jan-94 13,437 12,799 13,336 13,686 Feb-94 13,081 12,459 13,104 13,380 Mar-94 12,654 12,053 12,781 13,023 Apr-94 12,524 11,929 12,678 12,909 May-94 12,517 11,923 12,677 12,876 Jun-94 12,474 11,881 12,649 12,845 Jul-94 12,706 12,103 12,901 13,126 Aug-94 12,712 12,109 12,916 13,135 Sep-94 12,503 11,909 12,726 12,920 Oct-94 12,459 11,867 12,715 12,900 Nov-94 12,428 11,838 12,687 12,878 Dec-94 12,534 11,939 12,775 12,971 Jan-95 12,749 12,143 13,028 13,230 Feb-95 13,056 12,436 13,338 13,563 Mar-95 13,130 12,506 13,419 13,662 Apr-95 13,322 12,689 13,607 13,867 May-95 13,841 13,184 14,133 14,474 Jun-95 13,929 13,267 14,237 14,595 Jul-95 13,883 13,224 14,205 14,536 Aug-95 14,039 13,372 14,377 14,739 Sep-95 14,182 13,509 14,517 14,897 Oct-95 14,422 13,736 14,705 15,106 Nov-95 14,648 13,952 14,926 15,369 Dec-95 14,869 14,163 15,135 15,606 Jan-96 14,933 14,223 15,235 15,704 Feb-96 14,636 13,940 14,970 15,356 Mar-96 14,504 13,815 14,865 15,227 Apr-96 14,373 13,690 14,782 15,115 May-96 14,325 13,644 14,752 15,088 Jun-96 14,503 13,814 14,950 15,297 Jul-96 14,526 13,836 14,990 15,330 Aug-96 14,506 13,817 14,965 15,290 Sep-96 14,774 14,072 15,225 15,580 Oct-96 15,073 14,357 15,563 15,965 Nov-96 15,359 14,629 15,829 16,276 Dec-96 15,192 14,470 15,682 16,079 Jan-97 15,215 14,492 15,731 16,099 Feb-97 15,268 14,543 15,770 16,145 Mar-97 15,054 14,339 15,595 15,932 Apr-97 15,303 14,576 15,829 16,168 May-97 15,432 14,699 15,979 16,330 Jun-97 15,638 14,895 16,169 16,538 Jul-97 16,135 15,368 16,606 17,078 Aug-97 15,929 15,173 16,465 16,865 Sep-97 16,185 15,416 16,708 17,140 Oct-97 16,364 15,587 16,951 17,396 Nov-97 16,436 15,655 17,029 17,489 Dec-97 16,602 15,813 17,201 17,674 Jan-98 16,878 16,077 17,421 17,910 Feb-98 16,872 16,071 17,407 17,884 Mar-98 16,913 16,110 17,466 17,943 Apr-98 16,971 16,165 17,557 18,040 May-98 17,157 16,342 17,724 18,230 Jun-98 17,280 16,459 17,874 18,400 Jul-98 17,289 16,468 17,912 18,404 Aug-98 17,332 16,509 18,204 18,681 Sep-98 17,801 16,955 18,630 19,236 Oct-98 17,613 16,776 18,531 19,053 Nov-98 17,838 16,991 18,637 19,238 Dec-98 17,865 17,016 18,693 19,287 Jan-99 17,975 17,122 18,825 19,440 Feb-99 17,548 16,714 18,496 18,978 Mar-99 17,693 16,853 18,598 19,083 Apr-99 17,755 16,911 18,657 19,133 May-99 17,526 16,693 18,493 18,919 Jun-99 17,433 16,605 18,434 18,850 Jul-99 17,357 16,532 18,356 18,783 Aug-99 17,280 16,459 18,347 18,760 Sep-99 17,413 16,586 18,560 18,939 Oct-99 17,446 16,617 18,629 18,999 Nov-99 17,452 16,623 18,627 18,996 Dec-99 17,409 16,582 18,537 18,885 Jan-00 17,384 16,558 18,476 18,863 Feb-00 17,575 16,740 18,700 19,084 Mar-00 17,785 16,940 18,947 19,331 Apr-00 17,559 16,725 18,892 19,217 May-00 17,460 16,631 18,882 19,187 Jun-00 17,821 16,975 19,275 19,600 Jul-00 17,906 17,056 19,450 19,814 Aug-00 18,104 17,244 19,732 20,084 Sep-00 18,260 17,393 19,857 20,167 Oct-00 18,205 17,340 19,988 20,265 Performance Table
Cumulative Average Annual Total Return Total Return --------------------------------- -------------------- 1 5 Since Since Since Since Periods Ending October Year Years Inception 3/13/00/5/ Inception 3/13/00/5/ 31, 2000 ------ ----- --------- ---------- --------- ---------- Lehman Brothers Aggregate Bond Index/1/ 7.30% 6.33% 7.55% 5.80% 99.88% 5.80% 50%/50% Composite/1/,/2/ 6.67% 6.05% 7.71% 5.45% 102.65% 5.45% Core Bond Fund Class A (NAV) 4.35% 4.74% 6.50% 3.33% 82.05% 3.33% Core Bond Fund Class A (net of 4.75% sales charge) -0.61% 3.73% 5.96% -1.58% 73.40% -1.58% Core Bond Fund Class B (NAV) 3.70% 4.15% 5.07% 2.92% 38.54% 2.92% Core Bond Fund Class B (net of CDSC)/3/ -1.30% 3.81% 5.07% -2.08% 38.54% -2.08% Core Bond Fund Class C (NAV) 3.70% 4.15% 5.07% 2.92% 38.54% 2.92% Core Bond Fund Class C (net of CDSC)/4/ 2.70% 4.15% 5.07% 1.92% 38.54% 1.92% Core Bond Fund Institutional Class I/6/ N/A N/A 1.85% 1.85% 1.85% 1.85% Core Bond Fund Institutional Class II/6/ N/A N/A 1.81% 1.81% 1.81% 1.81%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/Comprised of 50% of the return of of the Lehman Brothers Corporate Bond Index and 50% of the return of the Lehman Brothers Government Bond Index. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /4/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /5/Current investment subadvisor assignment became effective 3/13/00. /6/Inception date is 7/10/2000. xxx Portfolio Manager's Commentary The Core Bond Fund Class A share performance for the year-ended October 31, 2000 was 4.35% as compared to the Lehman Brothers Aggregate Bond Index return of 7.30%. The Fund's performance is the result of a few key factors. One of these factors was our overweight in corporate bonds versus the Lehman Brothers Aggregate Index. Investors abandoned the corporate bond market because of the volatility in the equity markets and a fear that corporations have become too leveraged. Therefore, U.S. Government bonds performed well over the past year because of the turmoil in the equity and the corporate bond markets. These events have increased participation in the Government securities market because of its reputation as a safe harbor from outside events. This caused Government bonds to be the best performing sector in the market over this time period. Another factor that had a positive effect on the Fund was our concentration of bonds in the intermediate maturities. The intermediate maturities have performed well over this period - especially since the Federal Reserve stopped raising rates in the spring of 2000. On the economic front, it seems as if the economy is slowing enough to keep the Federal Reserve on hold for a while. The Fed has been on hold since the spring of 2000 but has kept a tightening bias. The only real negative during the quarter was the continued strength in the Oil markets. OPEC has increased production three times and the U.S. has arranged a swap of 30 million barrels out of the strategic reserve to try to lower oil prices. The current thinking in the market place is that higher oil prices act like an "economic tax" taking money away from consumer spending which accounts for 2/3 of economic growth thereby cutting economic growth. The problem is no one knows how much growth will be affected. Another problem is that in the short run it may be a "economic tax" but in the long run if prices stay high, businesses will not be able to continue to absorb the higher cost and must either charge higher prices or cut somewhere else. Another event that may affect the economy is the stock market. Over the past few years consumer spending, which accounts for approximately 2/3 of GDP, has tended to move with changes in the stock market. Therefore with the weak stock market over the past year consumer spending should slow. Either way the economy will most likely slow in the 4th quarter 2000, and quite possibly stay that way into the first part of 2001. Therefore, since a slower economy tends to be good for bonds, with the Federal Reserve on hold and Government agency and mortgage-backed securities still extremely attractive going forward we see value in continuing to have an overweight in these products with a concentration of the funds holdings in intermediate maturities. xxxi High Yield Bond Fund Investment Seeks the highest possible total return consistent with Objective: conservation of capital through investment in a diversified portfolio of high yielding, high-risk fixed- income securities. To achieve this objective, AGIM invests at least 65% of the Fund's total assets in below investment-grade U.S. and foreign junk bonds. These high yielding, high-risk fixed-income securities are rated below Baa3 by Moody's and BBB- by S&P or comparable investment quality at the time of purchase. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Gordon Massie Manager: Inception Date: November 2, 1998/5/ [GRAPH] NAV 4.75% Sales Charge High Yield Market Index Nov-98 10,000 9,525 10,000 Nov-98 10,149 9,667 10,502 Dec-98 10,106 9,626 10,494 Jan-99 10,262 9,775 10,652 Feb-99 10,305 9,815 10,562 Mar-99 10,499 10,000 10,651 Apr-99 10,793 10,280 10,874 May-99 10,544 10,044 10,703 Jun-99 10,518 10,019 10,680 Jul-99 10,566 10,064 10,703 Aug-99 10,424 9,929 10,575 Sep-99 10,359 9,867 10,495 Oct-99 10,228 9,742 10,424 Nov-99 10,404 9,909 10,587 Dec-99 10,515 10,016 10,676 Jan-00 10,418 9,923 10,588 Feb-00 10,420 9,925 10,613 Mar-00 10,195 9,710 10,397 Apr-00 10,274 9,786 10,439 May-00 10,211 9,726 10,293 Jun-00 10,394 9,901 10,524 Jul-00 10,442 9,946 10,639 Aug-00 10,645 10,140 10,718 Sep-00 10,546 10,045 10,603 Oct-00 10,232 9,746 10,289 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Periods Ending October 31, 2000/5/ Year Inception Inception ------ --------- ------------ Salomon Smith Barney High Yield Market Index/1/ -1.29% 1.44% 2.89% High Yield Bond Fund Class A (NAV) 0.04% 1.15% 2.32% High Yield Bond Fund Class A (net of 4.75% sales charge) -4.71% -1.28% -2.54% High Yield Bond Fund Class B (NAV) -0.83% 0.34% 0.69% High Yield Bond Fund Class B (net of CDSC)/2/ -5.79% -2.18% -4.31% High Yield Bond Fund Class C (NAV)/4/ N/A -3.29% -3.29% High Yield Bond Fund Class C (net of CDSC)/3/,/4/ N/A -4.26% -4.26% High Yield Bond Fund Institutional Class I 0.04% 1.23% 2.48% High Yield Bond Fund Institutional Class II 0.30% 1.51% 3.04%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 8/21/2000. /5/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xxxii Portfolio Manager's Commentary The High Yield Bond Fund performance for the year ended October 31, 2000 was 0.04%, as compared to the Salomon Smith Barney High Yield Market Index return of -1.29%. This resulted in an outperformance of 1.33% versus the index. Returns for November and December 1999 were strong and the average yield on the high yield index declined from low 12% to mid 11%. Increasing corporate earnings primarily fueled this declination. However, in January, 2000, forecasted and actual high yield default rates along with mutual fund outflows began to increase which put pressure on high yield prices. For the ten months ended October 31, 2000, the mutual fund outflows were approximately $3.5 billion compared to an average inflow of over $10 billion per year for the previous four years. During this ten-month period, the average price for the high yield index decreased from 83 to 79 and the average yield on the index increased from mid 11% to mid 13%. The Fund outperformed the high yield index due to positive contributions from the Energy, Gaming, Healthcare (ex-skilled nursing facilities), Homebuilding, Textile, Telco - Wireless/Wireline and Automobile industries. This was partially offset by negative contributions from the European Cable, European Telco, Cinema, Chemicals and Metals industries. Currently, the high yield market faces several challenges from higher than normal default rates, market illiquidity, continued mutual fund outflows and restricted access to the capital markets. We believe returns in the overall high yield market will depend on several key macro trends including worldwide GDP growth, bank lending standards and high yield market inflows/outflows. We believe there are opportunities to outperform the high yield market with superior credit and industry selection. We are currently focused on companies and industries with improving credit fundamentals, strong asset values and no need to access the capital markets in the near term. xxxiii Municipal Bond Fund Investment Seeks to provide a high level of current income that is Objective: exempt from regular federal income taxes, consistent with the preservation of capital, by investing primarily in a portfolio of municipal obligations. The Fund will invest at least 80% of total assets in investment grade, municipal fixed-income securities. Investment grade securities are those rated at least Baa3 by Moody's or BBB- by S&P or Fitch, or of comparable quality at the time of purchase. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Robert Kase Manager: Inception Date: July 6, 1993/3/ [GRAPH] NAV 4.75% Sales Charge LB Municipal Bond Index Jul-93 10,000 9,525 10,000 Jul-93 10,020 9,544 10,013 Aug-93 10,261 9,774 10,221 Sep-93 10,373 9,881 10,338 Oct-93 10,417 9,922 10,357 Nov-93 10,300 9,811 10,266 Dec-93 10,457 9,960 10,483 Jan-94 10,616 10,112 10,602 Feb-94 10,302 9,813 10,328 Mar-94 9,665 9,206 9,907 Apr-94 9,742 9,280 9,992 May-94 9,839 9,372 10,079 Jun-94 9,756 9,293 10,020 Jul-94 9,944 9,472 10,204 Aug-94 9,943 9,471 10,239 Sep-94 9,709 9,248 10,089 Oct-94 9,454 9,005 9,909 Nov-94 9,158 8,723 9,730 Dec-94 9,494 9,043 9,944 Jan-95 9,766 9,302 10,228 Feb-95 10,106 9,626 10,526 Mar-95 10,195 9,711 10,647 Apr-95 10,209 9,724 10,660 May-95 10,587 10,085 11,000 Jun-95 10,435 9,939 10,904 Jul-95 10,514 10,015 11,008 Aug-95 10,649 10,143 11,147 Sep-95 10,717 10,208 11,218 Oct-95 10,897 10,380 11,380 Nov-95 11,147 10,618 11,569 Dec-95 11,273 10,737 11,680 Jan-96 11,307 10,770 11,769 Feb-96 11,227 10,694 11,689 Mar-96 11,055 10,530 11,539 Apr-96 10,998 10,475 11,507 May-96 11,009 10,486 11,503 Jun-96 11,149 10,619 11,628 Jul-96 11,242 10,708 11,734 Aug-96 11,254 10,719 11,731 Sep-96 11,443 10,899 11,896 Oct-96 11,585 11,035 12,030 Nov-96 11,787 11,227 12,250 Dec-96 11,739 11,182 12,199 Jan-97 11,727 11,170 12,222 Feb-97 11,837 11,274 12,334 Mar-97 11,727 11,170 12,170 Apr-97 11,837 11,274 12,273 May-97 11,995 11,425 12,457 Jun-97 12,130 11,554 12,590 Jul-97 12,486 11,893 12,939 Aug-97 12,375 11,787 12,817 Sep-97 12,511 11,917 12,970 Oct-97 12,610 12,011 13,053 Nov-97 12,672 12,070 13,130 Dec-97 12,872 12,260 13,321 Jan-98 13,009 12,391 13,458 Feb-98 12,996 12,379 13,462 Mar-98 13,020 12,401 13,475 Apr-98 12,955 12,340 13,414 May-98 13,146 12,521 13,626 Jun-98 13,197 12,570 13,679 Jul-98 13,118 12,495 13,713 Aug-98 13,324 12,691 13,926 Sep-98 13,427 12,789 14,100 Oct-98 13,372 12,737 14,100 Nov-98 13,335 12,701 14,149 Dec-98 13,382 12,747 14,185 Jan-99 13,523 12,881 14,353 Feb-99 13,454 12,815 14,290 Mar-99 13,437 12,798 14,310 Apr-99 13,486 12,846 14,346 May-99 13,389 12,753 14,263 Jun-99 13,225 12,597 14,057 Jul-99 13,249 12,619 14,108 Aug-99 13,137 12,513 13,995 Sep-99 13,122 12,498 14,001 Oct-99 12,970 12,354 13,850 Nov-99 13,036 12,417 13,997 Dec-99 12,938 12,324 13,893 Jan-00 12,825 12,216 13,832 Feb-00 13,018 12,399 13,993 Mar-00 13,254 12,625 14,299 Apr-00 13,195 12,568 14,215 May-00 13,136 12,512 14,141 Jun-00 13,458 12,819 14,516 Jul-00 13,624 12,977 14,717 Aug-00 13,804 13,148 14,944 Sep-00 13,728 13,076 14,866 Oct-00 13,852 13,194 15,028 Performance Table
Cumulative Average Annual Total Return Total Return -------------------------------- -------------------- 1 5 Since Since Since Since Periods Ending October 31, Year Years Inception 3/13/00/3/ Inception 3/13/00/3/ 2000 ----- ----- --------- ---------- --------- ---------- Lehman Brothers Municipal Bond Index/4/ 8.51% 5.72% 5.72% 5.10% 50.28% 5.10% Municipal Bond Fund Class A (NAV) 6.80% 4.91% 4.55% 5.79% 38.52% 5.79% Municipal Bond Fund Class A (net of 4.75% sales charge) 1.73% 3.90% 3.86% 0.76% 31.94% 0.76% Municipal Bond Fund Class B (NAV) 5.92% 4.05% 4.75% 5.23% 35.79% 5.23% Municipal Bond Fund Class B (net of CDSC)/1/ 0.92% 3.70% 4.75% 0.23% 35.79% 0.23% Municipal Bond Fund Class C (NAV) 5.91% 4.04% 4.75% 5.22% 35.76% 5.22% Municipal Bond Fund Class C (net of CDSC)/2/ 4.91% 4.04% 4.75% 4.22% 35.76% 4.22%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Current investment subadvisor assignment became effective 3/13/00. /4/All since-inception returns for indices begin on the month-end closest to the actual inception date of the fund. xxxiv Portfolio Manager's Commentary The North American Municipal Bond Fund rose 6.80%, net of expenses, for the year-ended October 31, 2000 as compared to the 8.51% return posted by the Lehman Brothers Municipal Bond Index. As of October 31, 2000, the Fund had an average maturity of 14.7 years. Additionally, the top five industry sectors of the Fund were General Obligation, Housing, Industrial Development, Hospital, and Transportation. The top five states of the Fund were New York, Texas, Pennsylvania, Illinois, and Colorado. During the year-ended October 31, 2000, 10-year AAA-rated municipal bond yields fell by 34 basis points. Yields fell year over year due to supply/demand dynamics in the municipal market. Year over year, new issue supply declined by approximately 20% while demand for municipals among individuals, mutual funds, Property and Casualty insurance companies, and other buyers of municipal bonds remained strong overall. In addition, the slope of the municipal curve flattened by 82 basis points. In contrast, the 10-year Treasury note fell by 27 basis points. The municipal market benefited from limited new issue supply and increased demand from individual investors buying municipal bonds. Toward the end of the 2nd half of the year, the Fund's average maturity was lengthened slightly to take advantage of favorable demand/supply picture in the municipal bond market. The Fund continues to explore for opportunities to enhance yield among investment grade municipal bonds. xxxv Strategic Income Fund Investment Seeks a high level of total return consistent with Objective: preservation of capital. To achieve this objective, AGIM invests at least 65% of the Fund's total assets in a broad range of fixed-income securities. Those securities include investment grade bonds, U.S. Government and agency obligations, mortgage-backed securities, and U.S., Canadian, and foreign high-risk, high-yield bonds (commonly known as "junk bonds"). Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Steve Guterman Manager: Inception Date: November 1, 1993/3/ [GRAPH] NAV 4.75% Sales Charge LB Municipal Bond Index 1-Nov-93 10,000 9,525 10,000 30-Nov-93 10,019 9,543 9,915 31-Dec-93 10,122 9,641 9,969 31-Jan-94 10,283 9,795 10,103 28-Feb-94 10,001 9,526 9,927 31-Mar-94 9,539 9,086 9,682 30-Apr-94 9,444 8,996 9,605 31-May-94 9,567 9,113 9,604 30-Jun-94 9,522 9,070 9,583 31-Jul-94 9,564 9,110 9,773 31-Aug-94 9,615 9,158 9,785 30-Sep-94 9,638 9,180 9,641 31-Oct-94 9,621 9,164 9,632 30-Nov-94 9,561 9,107 9,611 31-Dec-94 9,435 8,986 9,678 31-Jan-95 9,448 8,999 9,869 28-Feb-95 9,543 9,090 10,104 31-Mar-95 9,592 9,137 10,166 30-Apr-95 9,899 9,429 10,308 30-May-95 10,244 9,758 10,707 30-Jun-95 10,381 9,888 10,785 31-Jul-95 10,428 9,933 10,761 31-Aug-95 10,463 9,966 10,892 30-Sep-95 10,642 10,137 10,997 31-Oct-95 10,720 10,211 11,140 30-Nov-95 10,906 10,388 11,307 31-Dec-95 11,187 10,655 11,466 31-Jan-96 11,685 11,130 11,541 29-Feb-96 11,497 10,951 11,341 31-Mar-96 11,502 10,956 11,261 30-Apr-96 11,645 11,092 11,198 31-May-96 11,737 11,180 11,176 30-Jun-96 11,868 11,304 11,325 31-Jul-96 11,924 11,358 11,356 31-Aug-96 12,108 11,532 11,337 30-Sep-96 12,494 11,901 11,534 31-Oct-96 12,580 11,982 11,790 30-Nov-96 12,812 12,204 11,992 31-Dec-96 12,845 12,235 11,880 31-Jan-97 13,005 12,387 11,917 28-Feb-97 13,153 12,528 11,947 31-Mar-97 12,926 12,312 11,814 30-Apr-97 13,072 12,451 11,991 31-May-97 13,356 12,722 12,105 30-Jun-97 13,518 12,876 12,249 31-Jul-97 13,886 13,227 12,580 31-Aug-97 13,835 13,178 12,473 30-Sep-97 14,112 13,441 12,658 31-Oct-97 13,910 13,249 12,841 30-Nov-97 14,090 13,421 12,900 31-Dec-97 14,226 13,550 13,031 30-Jan-98 14,383 13,700 13,197 27-Feb-98 14,498 13,809 13,187 31-Mar-98 14,567 13,875 13,232 30-Apr-98 14,602 13,909 13,300 31-May-98 14,595 13,902 13,427 30-Jun-98 14,561 13,869 13,541 31-Jul-98 14,615 13,921 13,569 31-Aug-98 13,617 12,970 13,791 30-Sep-98 14,025 13,358 14,113 31-Oct-98 13,941 13,279 14,038 30-Nov-98 14,304 13,625 14,118 31-Dec-98 14,329 13,648 14,161 31-Jan-99 14,274 13,596 14,261 28-Feb-99 14,188 13,514 14,012 31-Mar-99 14,405 13,720 14,089 30-Apr-99 14,678 13,980 14,134 31-May-99 14,356 13,674 14,010 30-Jun-99 14,310 13,630 13,965 31-Jul-99 14,232 13,556 13,906 31-Aug-99 14,071 13,403 13,899 30-Sep-99 14,210 13,535 14,060 31-Oct-99 14,234 13,558 14,112 30-Nov-99 14,408 13,724 14,111 31-Dec-99 14,524 13,834 14,043 31-Jan-00 14,513 13,824 13,997 29-Feb-00 14,623 13,928 14,166 31-Mar-00 14,716 14,017 14,353 28-Apr-00 14,508 13,819 14,312 31-May-00 14,405 13,721 14,304 30-Jun-00 14,747 14,047 14,602 31-Jul-00 14,956 14,246 14,735 31-Aug-00 15,222 14,499 14,949 29-Sep-00 15,149 14,430 15,043 31-Oct-00 14,817 14,113 15,142 Performance Table
Cumulative Average Annual Total Return Total Return --------------------------------- -------------------- 1 5 Since Since Since Since Periods Ending October 31, Year Years Inception 3/13/00/3/ Inception 3/13/00/3/ 2000 ------ ----- --------- ---------- --------- ---------- Lehman Brothers Aggregate Bond Index/5/ 7.30% 6.33% 6.10% 5.50% 51.42% 5.50% Strategic Income Fund Class A (NAV) 4.09% 6.69% 5.78% 0.19% 48.17% 0.19% Strategic Income Fund Class A (net of 4.75% sales charge) -0.85% 5.65% 5.04% -4.57% 41.13% -4.57% Strategic Income Fund Class B (NAV) 3.33% 6.00% 6.22% -0.31% 48.86% -0.31% Strategic Income Fund Class B (net of CDSC)/1/ -1.67% 5.69% 6.22% -5.30% 48.86% -5.30% Strategic Income Fund Class C (NAV) 3.32% 6.00% 6.22% -0.32% 48.82% -0.32% Strategic Income Fund Class C (net of CDSC)/2/ 2.32% 6.00% 6.22% -1.32% 48.82% -1.32% Strategic Income Fund Institutional Class I/4/ N/A N/A -0.10% -0.10% -0.10% -0.10%
- ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Current investment subadvisor assignment became effective 3/13/00. /4/Inception date is 7/10/2000. /5/All since-inception returns for indices begin on the month-end closest to the actual inception date of the fund. xxxvi Portfolio Manager's Commentary The Strategic Income Fund Class A share performance for the year-ended October 31, 2000 was 4.09% as compared to the Lehman Brothers Aggregate Bond Index return of 7.30%. Over the last 12 months, the global fixed income markets have been impacted by a large number of world events. The factors impacting the market are very dynamic and have changed substantially from one year ago. The year started with the market reacting to the Federal Reserve raising the Federal Funds Rate in their continued attempt to slow the U.S. economic growth to sustainable levels. The Fed has clearly succeeded and concern today has shifted to worrying if the Fed has overshot the goal. We believe it has, and we also think there now may be a need for the Fed to ease during the year 2001. The U.S. was benefiting from some of the lowest oil prices in decades only a year ago. Today oil is trading at $30-$35 a barrel, double to triple the levels of those low prices. This has reduced discretionary spending and added to observed and anticipated inflation levels. With U.S. economic growth slowing, however, oil prices should at worst stabilize if not go down. We believe the worst of the oil induced inflationary impact should now be behind us. Despite a very large trade deficit, the U.S. dollar has strengthened over the year. The offset to the trade deficit was the large amount of investment by foreign entities and individuals in the U.S. Over the short run, the trade deficit will not change dramatically. However, the recent volatility and negative equity returns should dampen the investment flow, weakening the dollar especially relative to the Euro. This will benefit the Fund's small non-dollar exposure. Emerging market countries economic conditions have continued to improve over the year, providing the backdrop for very strong performance, over 18% return from the emerging market debt (EMD) component. This will be the second year in a row that EMD is the best performing fixed-income asset class. The Fund reduced exposure from 25% to slightly below 20% in EMD in order to lock in some of these gains. And finally, the weakness we have seen in the corporate bond markets, investment grade and high yield was driven by a widening in the credit yield spreads and increased levels of defaults. Relative to treasuries, the additional yield investors receive for purchasing corporate bonds provides more compensation than any time in the last 10 years. So while we think defaults will continue in 2001 at similar levels to 2000, we are maintaining the 40% allocation to high yield due to the ample compensation, over 700 basis points, which the market provides. xxxvii U.S. Government Securities Fund Investment Seeks a high level of current income consistent with the Objective: preservation of capital and maintenance of liquidity by investing in securities issued or guaranteed by the U.S. Government, its agencies, or instrumentalities. American General Investment Management, L.P. ("AGIM") Subadvisor: Portfolio Managers: Robert Kase August 28, 1989/4/ Inception Date: [GRAPH] NAV 4.75% Sales Charge LB Municipal Bond Index Oct-90 10,000 9,525 10,000 Nov-90 10,203 9,719 10,149 Dec-90 10,355 9,864 10,293 Jan-91 10,487 9,989 10,397 Feb-91 10,554 10,053 10,452 Mar-91 10,612 10,108 10,509 Apr-91 10,724 10,215 10,617 May-91 10,788 10,276 10,678 Jun-91 10,786 10,273 10,689 Jul-91 10,951 10,431 10,804 Aug-91 11,118 10,589 11,006 Sep-91 11,285 10,749 11,193 Oct-91 11,386 10,845 11,320 Nov-91 11,487 10,941 11,453 Dec-91 11,739 11,182 11,732 Jan-92 11,602 11,051 11,614 Feb-92 11,676 11,121 11,658 Mar-92 11,584 11,034 11,611 Apr-92 11,726 11,169 11,717 May-92 11,904 11,339 11,884 Jun-92 12,084 11,510 12,056 Jul-92 12,301 11,716 12,280 Aug-92 12,419 11,829 12,421 Sep-92 12,587 11,989 12,593 Oct-92 12,428 11,838 12,438 Nov-92 12,367 11,780 12,383 Dec-92 12,517 11,923 12,546 Jan-93 12,739 12,134 12,781 Feb-93 12,899 12,286 12,972 Mar-93 13,009 12,391 13,021 Apr-93 13,087 12,465 13,124 May-93 13,039 12,419 13,085 Jun-93 13,233 12,605 13,273 Jul-93 13,274 12,644 13,300 Aug-93 13,445 12,806 13,503 Sep-93 13,486 12,845 13,561 Oct-93 13,502 12,860 13,585 Nov-93 13,426 12,788 13,520 Dec-93 13,474 12,834 13,573 Jan-94 13,597 12,951 13,708 Feb-94 13,411 12,774 13,513 Mar-94 13,252 12,622 13,324 Apr-94 13,254 12,625 13,233 May-94 13,243 12,614 13,247 Jun-94 13,219 12,591 13,256 Jul-94 13,373 12,737 13,421 Aug-94 13,417 12,779 13,463 Sep-94 13,253 12,624 13,355 Oct-94 13,214 12,587 13,358 Nov-94 13,181 12,555 13,291 Dec-94 13,259 12,630 13,341 Jan-95 13,480 12,840 13,563 Feb-95 13,759 13,106 13,822 Mar-95 13,839 13,182 13,898 Apr-95 13,992 13,327 14,057 May-95 14,508 13,819 14,459 Jun-95 14,589 13,896 14,554 Jul-95 14,539 13,849 14,563 Aug-95 14,681 13,984 14,683 Sep-95 14,779 14,077 14,782 Oct-95 14,951 14,241 14,947 Nov-95 15,125 14,407 15,134 Dec-95 15,285 14,559 15,288 Jan-96 15,385 14,654 15,419 Feb-96 15,150 14,431 15,246 Mar-96 15,037 14,323 15,173 Apr-96 14,985 14,273 15,125 May-96 14,919 14,211 15,117 Jun-96 15,088 14,371 15,265 Jul-96 15,116 14,398 15,312 Aug-96 15,128 14,410 15,328 Sep-96 15,362 14,633 15,523 Oct-96 15,645 14,902 15,776 Nov-96 15,865 15,112 15,970 Dec-96 15,750 15,002 15,883 Jan-97 15,827 15,076 15,943 Feb-97 15,857 15,103 15,961 Mar-97 15,739 14,992 15,878 Apr-97 15,932 15,176 16,056 May-97 16,061 15,298 16,180 Jun-97 16,190 15,421 16,319 Jul-97 16,502 15,718 16,626 Aug-97 16,448 15,667 16,555 Sep-97 16,646 15,855 16,738 Oct-97 16,828 16,029 16,932 Nov-97 16,842 16,042 16,971 Dec-97 17,008 16,200 17,115 Jan-98 17,210 16,393 17,346 Feb-98 17,207 16,389 17,323 Mar-98 17,255 16,435 17,380 Apr-98 17,338 16,515 17,458 May-98 17,457 16,627 17,576 Jun-98 17,541 16,708 17,698 Jul-98 17,590 16,754 17,768 Aug-98 17,834 16,987 18,122 Sep-98 18,168 17,305 18,550 Oct-98 18,075 17,217 18,592 Nov-98 18,090 17,230 18,523 Dec-98 18,158 17,296 18,592 Jan-99 18,245 17,378 18,681 Feb-99 18,023 17,167 18,394 Mar-99 18,127 17,266 18,529 Apr-99 18,179 17,315 18,585 May-99 18,009 17,154 18,461 Jun-99 17,968 17,115 18,494 Jul-99 17,835 16,987 18,514 Aug-99 17,831 16,984 18,550 Sep-99 18,090 17,231 18,697 Oct-99 18,124 17,263 18,726 Nov-99 18,063 17,205 18,737 Dec-99 17,983 17,129 18,694 Jan-00 17,884 17,034 18,639 Feb-00 18,092 17,232 18,785 Mar-00 18,262 17,395 19,019 Apr-00 18,239 17,372 19,016 May-00 18,157 17,294 19,094 Jun-00 18,546 17,665 19,367 Jul-00 18,621 17,737 19,496 Aug-00 18,856 17,960 19,698 Sep-00 19,051 18,147 19,847 Oct-00 19,168 18,257 19,966 Performance Table
Cumulative Average Annual Total Return Total Return ----------------------------- ----------------- Periods Ending October 31, 1 5 10 Since 10 Since 2000 Year Years Years 3/13/00/4/ Years 3/13/00/4/ ------ ----- ----- ---------- ------ ---------- Merrill Lynch 1-10 Year Gov- ernment Index/1/ 6.68% 5.97% 7.16% 5.04% 99.66% 5.04% U.S. Government Securities Fund Class A (NAV) 5.76% 5.09% 6.72% 5.85% 91.68% 5.85% U.S. Government Securities Fund Class A (net of 4.75% sales charge) 0.74% 4.08% 6.20% 0.82% 82.57% 0.82% U.S. Government Securities Fund Class B (NAV) 4.91% 4.44% 6.29% 5.38% 84.05% 5.38% U.S. Government Securities Fund Class B (net of CDSC)/2/ -0.09% 4.10% 6.29% 0.38% 84.05% 0.38% U.S. Government Securities Fund Class C (NAV) 4.91% 4.44% 6.29% 5.38% 84.05% 5.38% U.S. Government Securities Fund Class C (net of CDSC)/3/ 3.91% 4.44% 6.29% 4.38% 84.05% 4.38%
- ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Current investment subadvisor assignment became effective 3/13/00. xxxviii Portfolio Managers' Commentary The U.S. Government Securities Fund Class A share performance for the year- ended October 31, 2000 was 5.76% as compared to the Merrill Lynch 1-10 Year Government Index return of 6.68%. U.S. Government bonds performed well over the past year as equity prices faltered and the Federal Reserve stopped increasing interest rates earlier in 2000. These events have increased participation in the Government securities market because of its reputation for a safe harbor from outside events. The Fund's performance is the result of a couple of factors. One of these factors was the overweight in government agency and mortgage-backed bonds versus the index. The other factor that helped returns was our overweight in the intermediate part of the yield curve as the inversion of rates subsided (a yield curve is said to be inverted if short-term rates are higher than long term rates). On the economic front it seems as if the economy is slowing enough to keep the Federal Reserve on hold for a while. The Fed has been on hold since the spring of 2000 but has kept a tightening bias. The only real negative during the quarter was the continued strength in the Oil markets. OPEC has increased production three times and the U.S. has arranged a swap of 30 million barrels out of the strategic reserve in an attempt to lower oil prices. The current thinking in the market place is that higher oil prices act like an "economic tax" taking money away from consumer spending - which accounts for 2/3 of economic growth - thereby cutting economic growth. The problem is no one knows just how much growth will be affected. Another problem I see is that in the short run it may be a "economic tax" but in the long run if prices stay high, businesses will not be able to continue to absorb the higher cost and will either have to charge higher prices or cut some where else. Another event that may affect the economy is the stock market. Over the past few years consumer spending, which accounts for approximately 2/3 of GDP, has tended to move with changes in the stock market. Therefore with the weak stock market over the past year consumer spending should slow. Either way the economy will most likely slow in the 4th quarter 2000 and quite possibly into the first part of 2001. Therefore going forward, since a slower economy tends to be good for bonds, with the Federal Reserve on hold and Government agency and mortgage-backed securities still extremely attractive, at this time we see value in continuing to have an overweight in these products with a concentration of the Fund's holdings in intermediate maturities. xxxix Aggressive Growth Lifestyle Fund Investment Seeks to provide growth of capital through investments in Objective: a combination of the North American Funds. The Fund is suitable for investors seeking the potential growth of capital that a fund investing predominantly in equity securities may offer Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Steve Guterman, Magali Azema-Barac, William Trimbur Managers: Inception Date: November 2, 1998/5/ [GRAPH] NAV 5.75% Sales Charge S&P 500 Blended Benchmark Index Nov-98 10,000 9,425 10,000 10,000 Nov-98 10,350 9,755 10,606 10,487 Dec-98 10,794 10,173 11,217 10,976 Jan-99 11,004 10,371 11,685 11,111 Feb-99 10,563 9,956 11,323 10,708 Mar-99 10,904 10,277 11,775 11,019 Apr-99 11,387 10,732 12,231 11,653 May-99 11,247 10,600 11,943 11,469 Jun-99 11,818 11,138 12,605 11,903 Jul-99 11,781 11,104 12,213 11,733 Aug-99 11,620 10,952 12,152 11,561 Sep-99 11,550 10,886 11,819 11,421 Oct-99 11,968 11,280 12,567 11,854 Nov-99 12,711 11,981 12,823 12,187 Dec-99 13,914 13,114 13,577 12,998 Jan-00 13,473 12,699 12,895 12,519 Feb-00 14,132 13,320 12,651 12,952 Mar-00 14,655 13,813 13,889 13,544 Apr-00 13,869 13,072 13,471 13,072 May-00 13,408 12,637 13,194 12,695 Jun-00 14,257 13,437 13,520 13,222 Jul-00 13,942 13,141 13,309 12,920 Aug-00 14,955 14,095 14,135 13,577 Sep-00 14,462 13,631 13,389 13,008 Oct-00 13,915 13,115 13,332 12,760 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Periods Ending October 31, 2000/5/ Year Inception Inception ------ --------- ------------ Aggressive Growth LifeStyle Blended Benchmark Index/1/ 7.64% 12.98% 27.60% S&P 500 Index 6.09% 15.49% 33.32% Aggressive Growth LifeStyle Fund Class A (NAV) 16.27% 17.99% 39.15% Aggressive Growth LifeStyle Fund Class A (net of 5.75% sales charge) 9.58% 14.54% 31.15% Aggressive Growth LifeStyle Fund Class B (NAV) 16.30% 17.93% 39.00% Aggressive Growth LifeStyle Fund Class B (net of CDSC)/2/ 11.30% 15.78% 34.00% Aggressive Growth LifeStyle Fund Class C (NAV)/4/ N/A -1.77% -1.77% Aggressive Growth LifeStyle Fund Class C (net of CDSC)/3/,/4/ N/A -2.75% -2.75% Aggressive Growth LifeStyle Fund Institutional Class I 16.22% 17.98% 39.13%
- ----------------------------------------------- /1/As of 05/01/00, benchmark for the Aggressive Growth Lifestyle consists of 10% Lehman Aggregate, 25% EAFE, and 65% Wilshire 5000. Prior to 05/01/00; Benchmark for Growth Lifestyle consists of 15% EAFE, 15% Salomon Brothers Primary Market Index, 13% S&P 500, 12% Russell 1000 Value, 10% Russell 2000 Growth, 10% Russell 2000 Value, 10% Lehman Aggregate, 8% Russell MidCap Value, 7% Russell MidCap Growth. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 8/10/2000. /5/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xl Portfolio Managers' Commentary The Aggressive Growth LifeStyle Fund Class A share performance for the year- ended October 31, 2000 was 16.27% significantly outperforming the Aggressive Growth LifeStyle Blended Benchmark Index (10% Lehman Aggregate, 25% EAFE, and 65% Wilshire 5000) return of 7.64%. The financial markets had remarkably different return and volatility patterns over the twelve months ended October 31, 2000. From November 1999 through March 2000, growth stock performance was strong. Driven largely by the telecommunication, media, and technology sectors (TMTs), growth stocks reached very high valuations on the expectation that they were uniquely placed to provide the equipment and content to the Internet. Over this period the Russell 2000 Growth Index returned 22.7% while its value counterpart returned 8.2%. Value stocks are typically in traditional economy sectors such as steel and pharmaceuticals. As bonds were a largely ignored asset class, fixed income as measured by the Lehman Aggregate Bond Index returned 1.4%. The next six months witnessed a brutal sell off in TMTs, a flight to safety, a bond rally, and investors rediscovering value stocks. All of these activities combined to bring us to October 31, 2000. Over this period the Russell 2000 Growth Index declined 7.0%, the Lehman Aggregate Bond Index rose 5.7%, and the Russell 2000 Value Index increased 8.3%. We believe the sell off in the growth sector has yet to run its course. Investors remain very skeptical that Internet equipment and content related names can raise the necessary funds to grow and that the time needed to achieve profitable growth is difficult to predict. The Lifestyle Funds did well throughout this volatile period. Three aspects were particularly beneficial. First, most of the constituent mutual funds held in the Lifestyle Funds outperformed their benchmarks. Second, during the month of April 2000, the Lifestyle management team reconfigured holdings to scale back growth investments and add to value investments. Finally, the Lifestyle concept worked well as it is suited to periods of asset class and/or sector rotation since we maintain representation in all classes and do not attempt to time short term rotations. xli Moderate Growth Lifestyle Fund Investment Seeks to provide growth of capital and current income Objective: through investments in a combination of the North American Funds. The Fund is suitable for investors who wish to invest in equity securities, but are not willing to assume the substantial market risks of the Aggressive Growth LifeStyle Fund. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Steve Guterman, Magali Azema-Barac, William Trimbur Managers: Inception Date: November 2, 1998/5/ [GRAPH] NAV 5.75% Sales Charge S&P 500 Blended Benchmark Index Nov-98 10,000 9,425 10,000 10,000 Nov-98 10,310 9,717 10,606 10,410 Dec-98 10,764 10,145 11,217 10,821 Jan-99 10,942 10,313 11,685 10,954 Feb-99 10,521 9,916 11,323 10,604 Mar-99 10,812 10,190 11,775 10,857 Apr-99 11,242 10,595 12,231 11,410 May-99 11,131 10,491 11,943 11,275 Jun-99 11,563 10,898 12,605 11,621 Jul-99 11,446 10,788 12,213 11,424 Aug-99 11,264 10,617 12,152 11,255 Sep-99 11,184 10,541 11,819 11,122 Oct-99 11,520 10,858 12,567 11,502 Nov-99 11,996 11,306 12,823 11,734 Dec-99 12,772 12,038 13,577 12,312 Jan-00 12,407 11,693 12,895 11,947 Feb-00 12,825 12,087 12,651 12,227 Mar-00 13,379 12,609 13,889 12,812 Apr-00 12,875 12,135 13,471 12,472 May-00 12,592 11,868 13,194 12,184 Jun-00 13,126 12,371 13,520 12,638 Jul-00 12,980 12,233 13,309 12,451 Aug-00 13,741 12,951 14,135 13,019 Sep-00 13,395 12,625 13,389 12,614 Oct-00 13,049 12,299 13,332 12,447 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Periods Ending October 31, 2000/5/ Year Inception Inception ------ --------- ------------ Moderate Growth LifeStyle Blended Benchmark Index/1/ 8.22% 11.58% 24.47% S&P 500 Index 6.09% 15.49% 33.32% Moderate Growth LifeStyle Fund Class A (NAV) 13.27% 14.25% 30.49% Moderate Growth LifeStyle Fund Class A (net of 5.75% sales charge) 6.76% 10.92% 22.99% Moderate Growth LifeStyle Fund Class B (NAV) 13.22% 14.26% 30.50% Moderate Growth LifeStyle Fund Class B (net of CDSC)/2/ 8.22% 12.04% 25.50% Moderate Growth LifeStyle Fund Class C (NAV)/4/ N/A -2.30% -2.30% Moderate Growth LifeStyle Fund Class C (net of CDSC)/3/,/4/ N/A -3.28% -3.28% Moderate Growth LifeStyle Fund Institutional Class I 13.10% 14.24% 30.47%
- ----------------------------------------------- /1/As of 05/01/00, benchmark for the Moderate Growth Lifestyle consists of 30% Lehman Aggregate, 15% EAFE, and 55% Wilshire 5000. Prior to 05/01/00; Benchmark for Moderate Growth Lifestyle consists of 7% EAFE, 8% Salomon Brothers Primary Market Index, 15% S&P 500, 15% Russell 1000 Value, 7% Russell 2000 Growth, 8% Russell 2000 Value, 25% Lehman Aggregate, 8% Russell MidCap Value, 7% Russell MidCap Growth. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 7/12/2000. /5/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xlii Portfolio Managers' Commentary The Moderate Growth LifeStyle Fund Class A share performance for the year- ended October 31, 2000 was 13.27% outperforming the Moderate Growth LifeStyle Blended Benchmark Index (30% Lehman Aggregate, 15% EAFE, and 55% Wilshire 5000) return of 8.22%. The financial markets had remarkably different return and volatility patterns over the twelve months ended October 31, 2000. From November 1999 through March 2000, growth stock performance was strong. Driven largely by the telecommunication, media, and technology sectors (TMTs), growth stocks reached very high valuations on the expectation that they were uniquely placed to provide the equipment and content to the Internet. Over this period the Russell 2000 Growth Index returned 22.7% while its value counterpart returned 8.2%. Value stocks are typically in traditional economy sectors such as steel and pharmaceuticals. As bonds were a largely ignored asset class, fixed income as measured by the Lehman Aggregate Bond Index returned 1.4%. The next six months witnessed a brutal sell off in TMTs, a flight to safety, a bond rally, and investors rediscovering value stocks. All of these activities combined to bring us to October 31, 2000. Over this period the Russell 2000 Growth Index declined 7.0%, the Lehman Aggregate Bond Index rose 5.7%, and the Russell 2000 Value Index increased 8.3%. We believe the sell off in the growth sector has yet to run its course. Investors remain very skeptical that Internet equipment and content related names can raise the necessary funds to grow and that the time needed to achieve profitable growth is difficult to predict. The Lifestyle Funds did well throughout this volatile period. Three aspects were particularly beneficial. First, most of the constituent mutual funds held in the Lifestyle Funds outperformed their benchmarks. Second, during the month of April 2000, the Lifestyle management team reconfigured holdings to scale back growth investments and add to value investments. In the Moderate Growth Lifestyle Fund, we additionally increased the allocation to fixed income. Finally, the Lifestyle concept worked well as it is suited to periods of asset class and/or sector rotation since we maintain representation in all classes and do not attempt to time short term rotations. xliii Conservative Growth Lifestyle Fund Seeks current income and low to moderate growth of Investment capital through investments in a combination of the North Objective: American Funds. The Fund is suitable for investors who wish to invest in equity securities, but are not willing to assume the substantial market risks of either the Aggressive Growth LifeStyle Fund or the Moderate Growth LifeStyle Fund. American General Investment Management, L.P. ("AGIM") Subadvisor: Portfolio Managers: Steve Guterman, Magali Azema-Barac, William Trimbur November 2, 1998/5/ Inception Date: [GRAPH] NAV 5.75% Sales Charge S&P 500 Blended Benchmark Index Nov-98 10,000 9,425 10,000 10,000 Nov-98 10,270 9,679 10,606 10,343 Dec-98 10,663 10,050 11,217 10,674 Jan-99 10,837 10,214 11,685 10,809 Feb-99 10,455 9,854 11,323 10,508 Mar-99 10,697 10,081 11,775 10,724 Apr-99 11,055 10,419 12,231 11,165 May-99 10,924 10,296 11,943 11,032 Jun-99 11,267 10,619 12,605 11,299 Jul-99 11,137 10,496 12,213 11,127 Aug-99 10,995 10,363 12,152 10,994 Sep-99 10,934 10,305 11,819 10,906 Oct-99 11,230 10,584 12,567 11,232 Nov-99 11,576 10,910 12,823 11,399 Dec-99 12,123 11,426 13,577 11,808 Jan-00 11,812 11,133 12,895 11,520 Feb-00 12,106 11,410 12,651 11,696 Mar-00 12,589 11,865 13,889 12,224 Apr-00 12,273 11,567 13,471 11,964 May-00 12,104 11,408 13,194 11,762 Jun-00 12,484 11,766 13,520 12,147 Jul-00 12,421 11,706 13,309 12,057 Aug-00 12,999 12,251 14,135 12,521 Sep-00 12,782 12,047 13,389 12,266 Oct-00 12,534 11,813 13,332 12,174 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2000/5/ ------ --------- ------------ Conservative Growth LifeStyle Blended Benchmark Index/1/ 8.38% 10.34% 21.74% S&P 500 Index 6.09% 15.49% 33.32% Conservative Growth LifeStyle Fund Class A (NAV) 11.61% 11.97% 25.34% Conservative Growth LifeStyle Fund Class A (net of 5.75% sales charge) 5.19% 8.70% 18.13% Conservative Growth LifeStyle Fund Class B (NAV) 11.66% 11.95% 25.29% Conservative Growth LifeStyle Fund Class B (net of CDSC)/2/ 6.66% 9.69% 20.29% Conservative Growth LifeStyle Fund Class C (NAV)/4/ N/A 0.06% 0.06% Conservative Growth LifeStyle Fund Class C (net of CDSC)/3/,/4/ N/A -0.94% -0.94% Conservative Growth LifeStyle Fund Institutional Class I 11.54% 11.90% 25.19%
- ----------------------------------------------- /1/As of 05/01/00, benchmark for the Conservative Growth Lifestyle consists of 50% Lehman Aggregate, 8% EAFE, and 42% Wilshire 5000. Prior to 05/01/00; Benchmark for Conservative Growth Lifestyle consists of 5% EAFE, 5% Salomon Brothers Primary Market Index, 15% S&P 500, 15% Russell 1000 Value, 5% Russell 2000 Growth, 5% Russell 2000 Value, 40% Lehman Aggregate, 5% Russell MidCap Value, 5% Russell MidCap Growth /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 7/20/2000. /5/Performance information shown for periods prior to July 7, 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xliv Portfolio Managers' Commentary: The Conservative Growth LifeStyle Fund Class A share performance for the year- ended October 31, 2000 was 11.61% outperforming the Conservative Growth LifeStyle Blended Benchmark (50% Lehman Aggregate, 8% EAFE, and 42% Wilshire 5000) return of 8.38%. The financial markets had remarkably different return and volatility patterns over the twelve months ended October 31, 2000. From November 1999 through March 2000, growth stock performance was strong. Driven largely by the telecommunication, media, and technology sectors (TMTs), growth stocks reached very high valuations on the expectation that they were uniquely placed to provide the equipment and content to the Internet. Over this period the Russell 2000 Growth Index returned 22.7% while its value counterpart returned 8.2%. Value stocks are typically in traditional economy sectors such as steel and pharmaceuticals. As bonds were a largely ignored asset class, fixed income as measured by the Lehman Aggregate Bond Index returned 1.4%. The next six months witnessed a brutal sell off in TMTs, a flight to safety, a bond rally, and investors rediscovering value stocks. All of these activities combined to bring us to October 31, 2000. Over this period the Russell 2000 Growth Index declined 7.0%, the Lehman Aggregate Bond Index rose 5.7%, and the Russell 2000 Value Index increased 8.3%. We believe the sell off in the growth sector has yet to run its course. Investors remain very skeptical that Internet equipment and content related names can raise the necessary funds to grow and that the time needed to achieve profitable growth is difficult to predict. The Lifestyle funds did well throughout this volatile period. Three aspects were particularly beneficial. First, most of the constituent mutual funds held in the Lifestyle Funds outperformed their benchmarks. Second, during the month of April 2000, the Lifestyle management team reconfigured holdings to scale back growth investments and add to value investments. Finally, the Lifestyle concept worked well as it is suited to periods of asset class and/or sector rotation since we maintain representation in all classes and do not attempt to time short term rotations. xlv THIS PAGE INTENTIONALLY LEFT BLANK. Report of Independent Accountants - ------------------------------------------------------------------------------- To the Board of Trustees and Shareholders of North American Funds: In our opinion, the accompanying statements of assets and liabilities, including the portfolios of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the Growth & Income, Large Cap Growth (formerly Growth Equity), Mid Cap Growth (formerly Small/Mid Cap), Science & Technology, Small Cap Growth (formerly Emerging Growth), Global Equity, International Equity, International Small Cap, Balanced, Core Bond (formerly Investment Quality Bond), Municipal Bond (formerly National Municipal Bond), Strategic Income, U.S. Government Securities and Money Market Funds (portfolios of North American Funds) at October 31, 2000, the results of their operations, the changes in their net assets and the financial highlights for the periods indicated therein, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the accompanying statements of assets and liabilities, including the portfolios of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the Mid Cap Value, Small Cap Index, Socially Responsible, Stock Index, High Yield Bond, Municipal Money Market, Aggressive Growth LifeStyle (formerly Growth LifeStyle), Moderate Growth LifeStyle and Conservative Growth LifeStyle (portfolios of North American Funds) at October 31, 2000, the results of their operations, the changes in their net assets and the financial highlights for the year ended October 31, 2000, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the North American Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at October 31, 2000, by correspondence with the custodian, provide a reasonable basis for our opinion. The financial statements of the Mid Cap Value, Small Cap Index, Socially Responsible, Stock Index, High Yield Bond, Municipal Money Market, Aggressive Growth LifeStyle (formerly Growth LifeStyle), Moderate Growth LifeStyle and Conservative Growth LifeStyle Funds for the year ended October 31, 1999 were audited by other independent accountants whose report dated December 13, 1999 expressed an unqualified opinion on those statements. PricewaterhouseCoopers LLP Boston, Massachusetts December 27, 2000 1 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Growth & Large Cap Mid Cap Mid Cap Science & Income Growth Growth Value Technology Fund Fund Fund Fund Fund ------------ ----------- ----------- ----------- ----------- ASSETS: Investments in securities, at value* (See accompanying Portfolio of Investments)... $333,300,824 $86,189,813 $77,111,681 $22,924,503 $22,083,768 Cash......................... 923 110 782 224 980 Foreign currency (Cost: $542 and $283, respectively)..... - - 518 - 283 Investment in State Street Bank & Trust Company Navigator Securities Lending Trust held as collateral for securities on loan, at value (Note 2).................... 2,052,000 7,577,734 10,716,980 - - Receivables: Investments sold............ 4,161,693 1,325,950 474,806 420,357 44,083 Fund shares sold............ 145,018 405,976 228,668 147,878 138,849 Dividends................... 255,031 13,016 5,293 10,429 274 Interest.................... 493 579 346 230 272 Other assets................. 7,383 75,011 53,023 39,261 30,401 ------------ ----------- ----------- ----------- ----------- Total assets............... 339,923,365 95,588,189 88,592,097 23,542,882 22,298,910 ------------ ----------- ----------- ----------- ----------- LIABILITIES: Payables: Investments purchased....... 2,293,964 1,476,785 1,165,001 804,789 64,491 Fund shares redeemed........ 940,332 162,238 293,339 307,472 113,480 Investment adviser.......... 192,834 102,567 68,236 62,685 20,601 Custodian and transfer agent fees....................... 221,447 15,188 7,143 8,669 4,502 Securities lending.......... 2,052,000 7,577,734 10,716,980 - - Distribution fee............ 192,588 72,825 63,525 20,486 23,805 Other accrued expenses...... 441,975 25,117 21,345 6,081 5,552 ------------ ----------- ----------- ----------- ----------- Total liabilities.......... 6,335,140 9,432,454 12,335,569 1,210,182 232,431 ------------ ----------- ----------- ----------- ----------- NET ASSETS................... $333,588,225 $86,155,735 $76,256,528 $22,332,700 $22,066,479 ------------ ----------- ----------- ----------- ----------- NET ASSETS CONSIST OF: Accumulated undistributed net realized gain/(loss) on investments, foreign currency and forward foreign currency contracts.................. $25,728,686 ($316,096) ($363,899) $44,739 ($1,715,633) Unrealized appreciation/(depreciation) on: Investments................ 85,568,850 1,157,123 7,457,274 2,959,117 (779,663) Foreign currency and forward foreign currency contracts................. - (14) (24) - - Capital shares at par value of $.001 (Note 3).......... 12,563 4,818 4,406 1,656 2,748 Additional paid-in capital.. 222,278,126 85,309,904 69,158,771 19,327,188 24,559,027 ------------ ----------- ----------- ----------- ----------- Net assets................. $333,588,225 $86,155,735 $76,256,528 $22,332,700 $22,066,479 ------------ ----------- ----------- ----------- ----------- *Investments in securities, at identified cost (Note 2).......................... $247,731,974 $85,032,690 $69,654,407 $19,965,386 $22,863,431 ------------ ----------- ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 2 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Growth & Large Cap Mid Cap Mid Cap Science & Income Growth Growth Value Technology Fund Fund Fund Fund Fund ------------ ----------- ----------- ----------- ----------- NET ASSET VALUES: Class A Shares Net assets at value.... $46,580,678 $9,547,691 $11,718,178 $2,746,501 $4,622,919 Shares outstanding..... 1,721,209 521,966 654,743 201,837 572,254 Net asset value (NAV) and redemption price per share.............. $27.06 $18.29 $17.90 $13.61 $8.08 ------ ------ ------ ------ ----- Public offering price per share (100/94.25 of NAV) On sales of $100,000 or more the offering price is reduced............. $28.71 $19.41 $18.99 $14.44 $8.57 ------ ------ ------ ------ ----- Class B Shares Net assets at value.... $106,463,563 $34,711,428 $29,976,891 $7,471,390 $15,839,856 Shares outstanding..... 4,035,746 1,965,599 1,760,271 561,191 1,973,058 Net asset value, offering price and redemption price per share.................. $26.38 $17.66 $17.03 $13.31 $8.03 ------ ------ ------ ------ ----- Class C Shares Net assets at value.... $170,276,805 $22,779,735 $22,913,853 $613,863 $1,065,033 Shares outstanding..... 6,426,827 1,291,420 1,342,815 46,297 136,184 Net asset value, offering price and redemption price per share.................. $26.49 $17.64 $17.06 $13.26 $7.82 ------ ------ ------ ------ ----- Class I Shares Net assets at value.... $10,267,179 $19,116,881 $11,647,606 $11,500,946 $538,671 Shares outstanding..... 378,695 1,037,755 648,263 846,972 66,676 Net asset value, offering price and redemption price per share.................. $27.11 $18.42 $17.97 $13.58 $8.08 ------ ------ ------ ------ -----
The accompanying notes are an integral part of the financial statements. 3 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Small Cap Small Cap Socially Stock Global Growth Index Responsible Index Equity Fund Fund Fund Fund Fund ----------- ---------- ----------- ----------- ----------- ASSETS: Investments in securities, at value* (Includes a repurchase agreements of $2,102,000 and $3,808,000 in Socially Responsible and Stock Index, respectively) (See accompanying Portfolio of Investments)............. $38,937,294 $7,953,661 $11,611,496 $34,142,115 $36,898,026 Receivable for forward foreign currency contracts to sell (Notes 2 and 8)..... - - - - 717,071 Forward foreign currency contracts to buy, at value (Cost: $219,249)............ - - - - 217,431 Cash......................... - 111 194 58 - Foreign currency (Cost: $2,683)........................ - - - - 2,681 Investment in State Street Bank & Trust Company Navigator Securities Lending Trust held as collateral for securities on loan, at value (Note 2).................... 9,908,134 - - - 1,416,057 Variation margin receivable for open futures contracts.. - 29,175 46,400 84,100 - Unamortized organization costs....................... 14,261 - - - - Receivables: Investments sold............ 999,844 35,226 - - 1,266,555 Fund shares sold............ 131,375 7,391 1,779 45,867 1,150,138 Dividends................... - 3,919 8,104 20,598 10,065 Interest.................... 21,827 138 1,045 1,301 - Foreign tax withholding reclaims................... - - - - 19,449 Other assets................. 50,283 37,959 19,122 40,290 890 ----------- ---------- ----------- ----------- ----------- Total assets............... 50,063,018 8,067,580 11,688,140 34,334,329 41,698,363 ----------- ---------- ----------- ----------- ----------- LIABILITIES: Forward foreign currency contracts to sell, at value (Cost: $717,071) (Notes 2 and 8)...................... - - - - 717,010 Payables: Forward foreign currency contracts to buy (Notes 2 and 8)..................... - - - - 219,249 Investments purchased....... 1,018,933 3,967 - - 593,084 Fund shares redeemed........ 189,683 41,709 57,664 164,679 237,621 Dividend and interest withholding tax............ - - - - 1,535 Investment adviser.......... 60,375 35,423 36,556 93,530 51,636 Custodian and transfer agent fees....................... 5,949 1,806 6,339 21,023 14,788 Securities lending.......... 9,908,134 - - - 1,416,057 Distribution fee............ 31,808 7,540 14,916 37,747 20,833 Due to custodian............ - - - - 143,764 Other accrued expenses...... 8,361 4,817 4,927 8,118 34,707 ----------- ---------- ----------- ----------- ----------- Total liabilities.......... 11,223,243 95,262 120,402 325,097 3,450,284 ----------- ---------- ----------- ----------- ----------- NET ASSETS................... $38,839,775 $7,972,318 $11,567,738 $34,009,232 $38,248,079 ----------- ---------- ----------- ----------- ----------- NET ASSETS CONSIST OF: Undistributed net investment income/(loss) (Note 2)..... - $6,179 $20,177 $83,714 $1,969 Accumulated undistributed net realized gain/(loss) on investments, futures contracts, foreign currency and forward foreign currency contracts......... ($64,448) 125,433 (75,225) 70,776 (2,739,883) Unrealized appreciation/(depreciation) on: Investments................ 1,290,240 (488,290) 976,085 2,048,889 102,353 Futures Contracts.......... - (38,528) (83,859) (109,045) - Foreign currency and forward foreign currency contracts................. - - - - (4,266) Capital shares at par value of $.001 (Note 3).......... 2,275 815 971 2,685 3,523 Additional paid-in capital.. 37,611,708 8,366,709 10,729,589 31,912,213 40,884,383 ----------- ---------- ----------- ----------- ----------- Net assets................. $38,839,775 $7,972,318 $11,567,738 $34,009,232 $38,248,079 ----------- ---------- ----------- ----------- ----------- *Investments in securities, at identified cost (Note 2).......................... $37,647,054 $8,441,951 $10,635,411 $32,093,226 $36,795,673 ----------- ---------- ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 4 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Small Cap Small Cap Socially Stock Global Growth Index Responsible Index Equity Fund Fund Fund Fund Fund ----------- ---------- ----------- ----------- ----------- NET ASSET VALUES: Class A Shares Net assets at value.... $6,795,064 $3,360,828 $1,896,053 $8,543,466 $8,610,142 Shares outstanding..... 393,395 343,283 159,215 670,245 778,783 Net asset value (NAV) and redemption price per share.............. $17.27 $9.79 $11.91 $12.75 $11.06 ------ ----- ------ ------ ------ Public offering price per share (100/94.25 of NAV) On sales of $100,000 or more the offering price is reduced............. $18.33 $10.39 $12.64 $13.53 $11.73 ------ ------ ------ ------ ------ Class B Shares Net assets at value.... $14,553,548 $4,573,755 $3,649,346 $24,965,810 $10,088,926 Shares outstanding..... 866,492 468,428 307,412 1,974,862 936,500 Net asset value, offering price and redemption price per share.................. $16.80 $9.76 $11.87 $12.64 $10.77 ------ ----- ------ ------ ------ Class C Shares Net assets at value.... $3,336,826 $37,735 $56,685 $499,956 $19,549,011 Shares outstanding..... 198,694 3,820 4,696 39,853 1,806,947 Net asset value, offering price and redemption price per share.................. $16.79 $9.88 $12.07 $12.55 $10.82 ------ ----- ------ ------ ------ Class I Shares Net assets at value.... $14,154,337 $5,965,654 Shares outstanding..... 816,824 499,990 Net asset value, offering price and redemption price per share.................. $17.33 $11.93 ------ ------
The accompanying notes are an integral part of the financial statements. 5 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
International International Core High Yield Equity Small Cap Balanced Bond Bond Fund Fund Fund Fund Fund ------------- ------------- ----------- ------------ ----------- ASSETS: Investments in securities, at value* (Includes a repurchase agreement of $6,787,000 in High Yield Bond) (See accompanying Portfolio of Investments)... $47,980,421 $26,808,623 $66,800,468 $431,901,204 $63,318,402 Receivable for forward foreign currency contracts to sell (Notes 2 and 8)..... 584,627 258,982 - - - Forward foreign currency contracts to buy, at value (Cost: $556,332 and $330,807, respectively)..... 548,472 330,924 - - - Cash......................... 644 - 983 826 302 Foreign currency (Cost: $53,621, $128,688 and $1,604, respectively)....... 52,945 128,630 1,457 - - Investment in State Street Bank & Trust Company Navigator Securities Lending Trust held as collateral for securities on loan, at value (Note 2).................... 3,410,912 - 17,427,484 - Variation margin receivable for open futures contracts.. 51,155 - - - - Receivables: Investments sold............ - 1,105,269 292,193 11,420,062 63,352 Fund shares sold............ 416,095 891,803 3,745 10,789 137,722 Dividends................... 55,611 6,044 31,304 - - Interest.................... 428 1,597 387,256 4,438,437 1,852,245 Foreign tax withholding reclaims................... 32,529 9,079 4,128 - 952 From adviser................ - 164,939 - - - Other assets................. 83,622 61,136 510 37,063 32,209 ----------- ----------- ----------- ------------ ----------- Total assets............... 53,217,461 29,767,026 67,522,044 465,235,865 65,405,184 ----------- ----------- ----------- ------------ ----------- LIABILITIES: Forward foreign currency contracts to sell, at value (Cost: $584,627 and $258,982, respectively) (Notes 2 and 8)............. 582,532 259,926 - - - Payables: Forward foreign currency contracts to buy (Notes 2 and 8)..................... 556,332 330,807 - - - Investments purchased....... 1,219,757 1,048,764 85,994 96,726,740 - Fund shares redeemed........ 241,939 24,033 590,711 148,866 - Investment Adviser.......... 49,134 - 52,057 1,365,248 219,338 Dividends................... - - 9,525 5,877 Dividend and interest withholding tax............ 7,248 796 1,016 7,755 - Custodian and transfer agent fees....................... - 94,219 43,900 79,311 22,622 Securities lending.......... 3,410,912 - - 17,427,484 - Distribution fee............ 46,691 - 36,696 24,303 2,108 Due to custodian............ - 448,129 - - - Other accrued expenses...... 4,149 - 29,360 60,631 15,003 ----------- ----------- ----------- ------------ ----------- Total liabilities.......... 6,118,694 2,206,674 839,734 115,849,863 264,948 ----------- ----------- ----------- ------------ ----------- NET ASSETS................... $47,098,767 $27,560,352 $66,682,310 $349,386,002 $65,140,236 ----------- ----------- ----------- ------------ ----------- NET ASSETS CONSIST OF: Undistributed net investment income/(loss) (Note 2)..... $6,160 - $438,881 ($509,240) $215,412 Accumulated undistributed net realized gain/(loss) on investments, futures, foreign currency and forward foreign currency contracts.................. 6,167,288 $1,309,881 (2,422,897) (21,638,294) (3,790,696) Unrealized appreciation/(depreciation) on: Investments................ (2,165,972) 146,747 3,507,783 (2,494,282) (6,592,689) Futures contracts.......... (42,740) - - - - Foreign currency and forward foreign currency contracts................. (10,866) (2,026) (986) - - Capital shares at par value of $.001 (Note 3).......... 4,524 1,480 7,049 36,398 7,622 Additional paid-in capital.. 43,140,373 26,104,269 65,152,480 373,991,420 75,300,587 ----------- ----------- ----------- ------------ ----------- Net assets................. $47,098,967 $27,581,354 $66,682,310 $349,386,002 $65,140,236 ----------- ----------- ----------- ------------ ----------- *Investments in securities, at identified cost (Note 2).......................... $50,146,393 $27,560,352 $63,292,685 $434,395,486 $69,911,091 ----------- ----------- ----------- ------------ -----------
The accompanying notes are an integral part of the financial statements. 6 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
International International Core High Yield Equity Small Cap Balanced Bond Bond Fund Fund Fund Fund Fund ------------- ------------- ----------- ------------ ----------- NET ASSET VALUES: Class A Shares Net assets at value.... $7,471,715 $6,002,818 $7,910,310 $3,857,920 $286,231 Shares outstanding..... 712,135 312,546 838,420 402,043 33,446 Net asset value (NAV) and redemption price per share.............. $10.49 $19.21 $9.43 $9.60 $8.56 ------ ------ ----- ----- ----- Public offering price per share (100/94.25 of NAV for International Equity, International Small Cap and Balanced, and 100/95.25 of NAV for Core Bond and High Yield Bond) On sales of $100,000 or more the offering price is reduced................ $11.17 $20.38 $10.01 $10.07 $8.99 ------ ------ ------ ------ ----- Class B Shares Net assets at value.... $18,204,011 $11,664,559 $15,566,482 $4,936,719 $1,593,671 Shares outstanding..... 1,759,614 633,026 1,659,500 514,777 186,386 Net asset value, offering price and redemption price per share.................. $10.34 $18.43 $9.38 $9.59 $8.55 ------ ------ ----- ----- ----- Class C Shares Net assets at value.... $4,766,873 $9,892,975 $37,282,021 $2,778,003 $544,543 Shares outstanding..... 462,134 534,732 3,924,460 289,674 63,680 Net asset value, offering price and redemption price per share.................. $10.31 $18.50 $9.50 $9.59 $8.55 ------ ------ ----- ----- ----- Class I Shares Net assets at value.... $16,656,168 $5,923,497 $19,971,183 $14,073 Shares outstanding..... 1,590,271 626,796 2,075,207 1,645 Net asset value, offering price and redemption price per share.................. $10.47 $9.45 $9.62 $8.56 ------ ----- ----- ----- Class II Shares Net assets at value.... $317,842,177 $62,701,718 Shares outstanding..... 33,115,963 7,337,180 Net asset value, offering price and redemption price per share.................. $9.60 $8.55 ----- -----
The accompanying notes are an integral part of the financial statements. 7 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
U. S Municipal Municipal Strategic Government Money Money Bond Income Securities Market Market Fund Fund Fund Fund Fund ----------- ----------- ----------- ----------- ---------- ASSETS: Investments in securities, at value* (Includes a repurchase agreement of $6,938,000 in U.S. Government Securities) (See accompanying Portfolio of Investments)................ $16,523,743 $36,880,649 $61,252,269 $46,628,413 $7,288,376 Cash......................... - 528 691 787 18,590 Foreign currency (Cost: $505,575)................... - 480,239 - - - Investment in State Street Bank & Trust Company Navigator Securities Lending Trust held as collateral for securities on loan, at value (Note 2).................... - 3,385,257 - - Receivables: Investments sold............ - 1,371,839 2,602,098 - - Fund shares sold............ 5 - 61,597 744,423 23,004 Dividends................... - 867 - - - Interest.................... 227,895 760,100 410,839 70,534 58,541 Foreign tax withholding reclaims................... - 7,984 - - - Other assets................. 63,922 46,609 38,077 92,216 30,353 ----------- ----------- ----------- ----------- ---------- Total assets............... 16,815,565 42,934,072 64,365,571 47,536,373 7,418,864 ----------- ----------- ----------- ----------- ---------- LIABILITIES: Payables: Investments purchased....... - 2,000,312 19,131,437 - - Fund shares redeemed........ 129,319 131,804 82,022 388,321 38,493 Dividends................... 15,335 1,635 436,647 13,703 1,938 Dividend and interest withholding tax............ - 35 - - - Investment adviser.......... 37,574 52,216 19,053 90,543 35,139 Custodian and transfer agent fees....................... 16,639 38,760 21,810 3,763 6,375 Securities lending.......... - 3,385,257 - - - Distribution fee............ 6,247 6,144 14,850 - - Due to custodian............ 123,341 - - - - Other accrued expenses...... - 55,952 19,181 14,561 - ----------- ----------- ----------- ----------- ---------- Total liabilities.......... 328,455 5,672,115 19,725,000 510,891 81,945 ----------- ----------- ----------- ----------- ---------- NET ASSETS................... $16,487,110 $37,261,957 $44,640,571 $47,025,482 $7,336,919 ----------- ----------- ----------- ----------- ---------- NET ASSETS CONSIST OF: Undistributed net investment income/(loss) (Note 2)..... - ($1,756) ($433,764) - - Accumulated undistributed net realized gain/(loss) on investments, foreign currency and forward foreign currency contracts.................. ($303,708) (7,471,052) (2,750,356) - - Unrealized appreciation/(depreciation) on: Investments................ (54,068) (2,495,990) (529,978) - - Foreign currency and forward foreign currency contracts................. - (30,487) - - - Capital shares at par value of $.001 (Note 3).......... 1,709 4,663 4,700 $20,621 $7,337 Additional paid-in capital.. 16,843,177 47,256,579 48,349,969 47,004,861 7,329,582 ----------- ----------- ----------- ----------- ---------- Net assets................. $16,487,110 $37,261,957 $44,640,571 $47,025,482 $7,336,919 ----------- ----------- ----------- ----------- ---------- *Investments in securities, at identified cost (Note 2).......................... $16,577,811 $39,376,639 $61,782,247 $46,628,413 $7,288,376 ----------- ----------- ----------- ----------- ----------
The accompanying notes are an integral part of the financial statements. 8 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
U. S Municipal Municipal Strategic Government Money Money Bond Income Securities Market Market Fund Fund Fund Fund Fund ---------- ----------- ----------- ----------- ---------- NET ASSET VALUES: Class A Shares Net assets at value.... $7,773,704 $6,438,551 $29,468,222 $25,609,709 $4,452,080 Shares outstanding..... 805,872 805,948 3,102,743 25,608,997 4,452,080 Net asset value (NAV) and redemption price per share.............. $9.65 $7.99 $9.50 $1.00 $1.00 ----- ----- ----- ----- ----- Public offering price per share (100/95.25 of NAV) On sales of $100,000 or more the offering price is reduced............. $10.13 $8.39 $9.97 ------ ----- ----- Class B Shares Net assets at value.... $6,416,271 $15,131,090 $8,326,332 $8,096,254 $2,776,525 Shares outstanding..... 665,106 1,893,633 876,444 8,096,025 2,776,525 Net asset value, offering price and redemption price per share.................. $9.65 $7.99 $9.50 $1.00 $1.00 ----- ----- ----- ----- ----- Class C Shares Net assets at value.... $2,297,135 $13,056,267 $6,846,017 $7,194,654 $108,314 Shares outstanding..... 238,150 1,634,043 720,664 7,194,049 108,314 Net asset value, offering price and redemption price per share.................. $9.65 $7.99 $9.50 $1.00 $1.00 ----- ----- ----- ----- ----- Class I Shares Net assets at value.... $2,636,049 $6,124,865 Shares outstanding..... 329,457 6,110,797 Net asset value, offering price and redemption price per share.................. $8.00 $1.00 ----- -----
The accompanying notes are an integral part of the financial statements. 9 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Aggressive Moderate Conservative Growth Growth Growth LifeStyle LifeStyle LifeStyle Fund Fund Fund ----------- ----------- ------------ ASSETS: Investments in securities, at value* (See accompanying Portfolio of Investments)................... $23,146,799 $20,901,375 $18,296,458 Cash............................... - 5,788 172,952 Receivables: Investments sold.................. 142,097 121,286 79,305 Fund shares sold.................. 10,627 9,532 4,809 Dividends......................... 14,443 39,254 57,690 Other assets....................... 46,971 51,251 42,661 ----------- ----------- ----------- Total assets..................... 23,360,937 21,128,486 18,653,875 ----------- ----------- ----------- LIABILITIES: Payables: Investments purchased............. 192,861 161,490 151,057 Fund shares redeemed.............. 116,091 103,917 91,974 Investment adviser................ 2,175 2,033 1,847 Due to custodian.................. 347,278 - - ----------- ----------- ----------- Total liabilities................ 658,405 267,440 244,878 ----------- ----------- ----------- NET ASSETS......................... $22,702,532 $20,861,046 $18,408,997 ----------- ----------- ----------- NET ASSETS CONSIST OF: Undistributed net investment income/(loss) (Note 2)........... $217,388 $217,410 $224,479 Accumulated undistributed net realized gain (loss) on investments, foreign currency and forward foreign currency contracts........................ 2,769,504 1,951,208 1,402,045 Unrealized appreciation (depreciation) on: Investments...................... (1,674,053) (854,933) (527,011) Capital shares at par value of $.001 (Note 3)................... 1,784 1,726 1,585 Additional paid-in capital........ 21,387,909 19,545,635 17,307,899 ----------- ----------- ----------- Net assets....................... $22,702,532 $20,861,046 $18,408,997 ----------- ----------- ----------- *Investments in securities, at identified cost (Note 2).......... $24,820,852 $21,756,308 $18,823,469 ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 10 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES continued - OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Aggressive Moderate Conservative Growth Growth Growth LifeStyle LifeStyle LifeStyle Fund Fund Fund ----------- ----------- ------------ NET ASSET VALUES: Class A Shares Net assets at value...................... $4,063,959 $3,396,397 $3,420,482 Shares outstanding....................... 319,639 281,384 295,187 Net asset value (NAV) and redemption price per share................................ $12.71 $12.07 $11.59 ------ ------ ------ Public offering price per share (100/94.25 of NAV) On sales of $100,000 or more the offering price is reduced......................... $13.49 $12.81 $12.30 ------ ------ ------ Class B Shares Net assets at value...................... $13,450,317 $11,842,757 $10,354,089 Shares outstanding....................... 1,056,857 980,147 890,264 Net asset value, offering price and redemption price per share............... $12.73 $12.08 $11.63 ------ ------ ------ Class C Shares Net assets at value...................... $184,340 $182,778 $150,158 Shares outstanding....................... 14,397 15,094 12,844 Net asset value, offering price and redemption price per share............... $12.80 $12.11 $11.69 ------ ------ ------ Class I Shares Net assets at value...................... $5,003,916 $5,439,114 $4,484,268 Shares outstanding....................... 393,158 450,821 386,770 Net asset value, offering price and redemption price per share................ $12.73 $12.06 $11.59 ------ ------ ------
The accompanying notes are an integral part of the financial statements. 11 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Growth & Large Cap Mid Cap Mid Cap Science & Income Growth Growth Value Technology Fund Fund Fund Fund/1/ Fund/2/ ----------- ----------- ----------- ---------- ----------- INVESTMENT INCOME: Interest.................... $113,030 $194,309 $110,005 $72,091 $50,131 Dividends (Net of $15,844, $1,016, $213 and $267 withholding tax in the Growth & Income, Large Cap Growth, Mid Cap Growth and Science & Technology Funds, respectively).............. 3,419,656 179,137 66,781 137,350 2,694 ----------- ----------- ----------- ---------- ----------- Total income............... 3,532,686 373,446 176,786 209,441 52,825 ----------- ----------- ----------- ---------- ----------- EXPENSES: Distribution for Class A.... 141,047 26,687 30,089 6,708 6,270 Distribution for Class B.... 1,077,287 269,230 247,274 68,846 68,010 Distribution for Class C.... 1,627,385 250,016 232,919 494 1,345 Service fee for Class I..... 6,405 9,860 7,458 11,389 909 Investment adviser fee (Note 5)......................... 2,086,628 571,885 555,072 122,473 84,190 Custodian fee............... 257,560 58,596 55,806 13,766 7,782 Transfer agent fee.......... 638,191 137,166 130,916 42,114 24,539 Accounting/administration... 488,309 92,681 87,397 8,719 6,217 Audit and legal fees........ 165,777 32,309 30,160 7,927 4,093 Miscellaneous............... 262,554 69,988 64,881 55,954 75,678 ----------- ----------- ----------- ---------- ----------- Expenses before reimbursement by investment adviser.................... 6,751,143 1,518,418 1,441,972 338,390 279,033 Reimbursement of expenses by investment adviser (Note 5)................... 460,894 220,117 143,698 72,036 115,911 ----------- ----------- ----------- ---------- ----------- Net expenses............... 6,290,249 1,298,301 1,298,274 266,354 163,122 ----------- ----------- ----------- ---------- ----------- Net investment loss........ (2,757,563) (924,855) (1,121,488) (56,913) (110,297) ----------- ----------- ----------- ---------- ----------- REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS, FUTURES CONTRACTS, FOREIGN CURRENCY AND FORWARD FOREIGN CURRENCY CONTRACTS: Net realized gain/(loss) on: Investment transactions..... 34,507,070 8,263,343 13,547,675 1,363,892 (1,715,633) Futures contracts........... - (12,436) - - - Foreign currency and forward foreign currency contracts.................. - (1,518) (184) - (2,189) Change in unrealized appreciation/(depreciation) on: Investments................. (28,936,197) (9,827,527) 1,554,570 3,297,838 (779,663) Translation of foreign currency and forward foreign currency contracts.................. 12 (12) (24) - - ----------- ----------- ----------- ---------- ----------- Net gain/(loss) on investments, futures contracts, foreign currency and forward foreign currency contracts................. 5,570,885 (1,578,150) 15,102,037 4,661,730 (2,497,485) ----------- ----------- ----------- ---------- ----------- Net increase/(decrease) in net assets resulting from Operations.................. $2,813,322 ($2,503,005) $13,980,549 $4,604,817 ($2,607,782) ----------- ----------- ----------- ---------- -----------
- --------------------- /1/Includes the financial results of the AGSPC2 Mid Cap Value Fund, which was reorganized into North American Mid Cap Value Fund on July 7, 2000. /2/Includes the financial results of the AGSPC2 Science & Technology Fund, which was reorganized into North American Science & Technology Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 12 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2000 - --------------------------------------------------------------------------------
Small Cap Small Cap Socially Stock Global Growth Index Responsible Index Equity Fund Fund/1/ Fund/2/ Fund/3/ Fund ------------ --------- ----------- --------- ------------ INVESTMENT INCOME: Interest.................... $93,537 $68,820 $69,382 $267,836 $86,866 Dividends (Net of $47, $353, $1,418 and $73,360 withholding tax in the Small Cap Index, Socially Responsible, Stock Index and Global Equity Funds, respectively).............. 8,594 90,683 106,473 271,627 760,190 ------------ --------- --------- --------- ------------ Total income............... 102,131 159,503 175,855 539,463 847,056 ------------ --------- --------- --------- ------------ EXPENSES: Distribution for Class A.... 8,617 9,656 5,204 20,596 32,316 Distribution for Class B.... 57,253 43,890 35,777 210,484 178,789 Distribution for Class C.... 22,481 41 91 549 310,964 Service fee for Class I..... 8,767 - 8,708 - - Investment adviser fee (Note 5)......................... 139,442 21,961 39,173 76,517 523,879 Custodian fee............... 33,048 7,370 9,671 28,261 104,939 Transfer agent fee.......... 32,653 24,252 29,316 87,283 155,674 Accounting/administration... 16,007 4,283 5,538 15,821 100,111 Amortization of organization expense.................... 6,581 - - - - Audit and legal fees........ 6,381 4,315 6,386 20,672 32,589 Miscellaneous............... 21,122 34,322 56,860 64,649 71,031 ------------ --------- --------- --------- ------------ Expenses before reimbursement by investment adviser.................... 352,352 150,090 196,724 524,832 1,510,292 Reimbursement of expenses by investment adviser (Note 5)................... 107,930 48,995 84,144 154,890 115,350 ------------ --------- --------- --------- ------------ Net expenses............... 244,422 101,095 112,580 369,942 1,394,942 ------------ --------- --------- --------- ------------ Net investment income/(loss)............. (142,291) 58,408 63,275 169,521 (547,886) ------------ --------- --------- --------- ------------ REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS, FUTURES CONTRACTS, FOREIGN CURRENCY AND FORWARD FOREIGN CURRENCY CONTRACTS: Net realized gain/(loss) on: Investment transactions..... 2,190,821 1,029,508 (33,597) 8,715 (2,278,794) Futures contracts........... - (27,491) (41,626) 164,278 - Foreign currency and forward foreign currency contracts.................. - - - - 592,673 Change in unrealized appreciation/(depreciation) on: Investments................. (4,046,826) (367,543) 212,439 678,065 (9,923,239) Futures contracts........... - (15,728) (83,859) (211,262) - Translation of foreign currency and forward foreign currency contracts.................. - - - - (149,268) ------------ --------- --------- --------- ------------ Net gain/(loss) on investments, futures contracts, foreign currency and forward foreign currency contracts................. (1,856,005) 618,746 53,357 639,796 (11,758,628) ------------ --------- --------- --------- ------------ Net increase/(decrease) in net assets resulting from operations.................. ($1,998,296) $677,154 $116,632 $809,317 ($12,306,514) ------------ --------- --------- --------- ------------
- --------------------- /1/Includes the financial results of the AGSPC2 Small Cap Index Fund, which was reorganized into North American Small Cap Index Fund on July 7, 2000. /2/Includes the financial results of the AGSPC2 Socially Responsible Fund, which was reorganized into North American Socially Responsible Fund on July 7, 2000. /3/Includes the financial results of the AGSPC2 Stock Index Fund, which was reorganized into North American Stock Index Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 13 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2000 - --------------------------------------------------------------------------------
International International High Yield Equity Small Cap Balanced Core Bond Bond Fund Fund Fund Fund Fund/1/ ------------- ------------- ---------- ----------- ---------- INVESTMENT INCOME: Interest (Net of $1,016 and $32,919 withholding tax in Balanced and Core Bond, respectively)................. $46,926 $65,197 $1,577,723 $8,261,351 $7,379,039 Dividends (Net of $65,003, $22,423 and $1,082 withholding tax in the International Equity, International Small Cap and Balanced Funds, respectively).............. 417,741 168,556 341,045 4,063 - ---------- ---------- ---------- ----------- ---------- Total income............... 464,667 233,753 1,918,768 8,265,414 7,379,039 ---------- ---------- ---------- ----------- ---------- EXPENSES: Distribution for Class A.... 19,093 21,276 20,979 12,104 573 Distribution for Class B.... 162,244 129,910 127,489 44,808 12,030 Distribution for Class C.... 63,986 114,276 434,292 35,079 744 Service fee for Class I..... 10,494 - 2,974 12,555 109 Investment adviser fee (Note 5)......................... 299,101 320,210 486,301 663,440 480,165 Custodian fee............... 59,663 138,873 61,474 95,737 60,357 Transfer agent fee.......... 80,226 69,971 143,751 108,293 169,844 Accounting/administration... 48,918 46,369 101,734 130,390 35,128 Audit and legal fees........ 17,244 15,796 34,097 54,788 34,380 Miscellaneous............... 46,224 70,082 70,265 119,016 102,017 ---------- ---------- ---------- ----------- ---------- Expenses before reimbursement by investment adviser.................... 807,193 926,763 1,483,356 1,276,210 895,347 Reimbursement of expenses by investment adviser (Note 5)................... 101,244 166,768 169,480 66,001 257,818 ---------- ---------- ---------- ----------- ---------- Net expenses............... 705,949 759,995 1,313,876 1,210,209 637,529 ---------- ---------- ---------- ----------- ---------- Net investment income/(loss)............. (241,282) (526,242) 604,892 7,055,205 6,741,510 ---------- ---------- ---------- ----------- ---------- REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS, FUTURES CONTRACTS, FOREIGN CURRENCY AND FORWARD FOREIGN CURRENCY CONTRACTS: Net realized gain/(loss) on: Investment transactions..... 6,800,924 2,239,050 (2,311,814) (6,875,365) (3,080,092) Futures contracts........... (90,708) - - - - Foreign currency and forward foreign currency contracts.................. (99,012) (237,008) 52,789 - (132) Change in unrealized appreciation/(depreciation) on: Investments................. (4,312,320) (1,519,207) 4,340,304 (1,935,720) (3,547,402) Futures contracts........... (14,920) - - - - Translation of foreign currency and forward foreign currency contracts.................. 1,648 (1,205) (853) - - ---------- ---------- ---------- ----------- ---------- Net gain/(loss) on investments, futures contracts, foreign currency and forward foreign currency contracts................. 2,285,612 481,630 2,080,426 (8,811,085) (6,627,626) ---------- ---------- ---------- ----------- ---------- Net increase/(decrease) in net assets resulting from operations.................. $2,044,330 ($44,612) $2,685,318 ($1,755,880) $113,884 ---------- ---------- ---------- ----------- ----------
- --------------------- /1/Includes the financial results of the AGSPC2 High Yield Bond Fund, which was reorganized into North American High Yield Bond Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 14 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2000 - --------------------------------------------------------------------------------
U. S. Municipal Municipal Strategic Government Money Money Bond Income Securities Market Market Fund Fund Fund Fund Fund/1/ --------- ---------- ---------- ---------- --------- INVESTMENT INCOME: Interest ................... $737,484 $4,369,896 $3,568,734 $1,774,475 $290,562 --------- ---------- ---------- ---------- --------- Total income............... 737,484 4,369,896 3,568,734 1,774,475 290,562 --------- ---------- ---------- ---------- --------- EXPENSES: Distribution for Class A.... 7,687 26,192 110,086 - 8,121 Distribution for Class B.... 46,249 180,981 98,571 - 21,856 Distribution for Class C.... 30,606 165,037 87,079 - - Service fee for Class I..... - 1,662 - - - Investment adviser fee (Note 5)......................... 76,875 322,001 300,110 56,326 32,947 Custodian fee............... 32,625 82,851 51,183 40,040 7,013 Transfer agent fee.......... 29,045 98,918 112,589 76,553 22,674 Accounting/administration... 19,678 70,665 81,338 41,454 3,882 Audit and legal fees........ 6,787 23,561 26,995 14,844 4,163 Miscellaneous............... 23,687 51,799 60,651 37,653 35,676 --------- ---------- ---------- ---------- --------- Expenses before reimbursement by investment adviser.................... 273,239 1,023,667 928,602 266,870 136,332 Reimbursement of expenses by investment adviser (Note 5)................... 77,977 133,830 181,196 72,800 49,099 --------- ---------- ---------- ---------- --------- Net expenses............... 195,262 889,837 747,406 194,070 87,233 --------- ---------- ---------- ---------- --------- Net investment income...... 542,222 3,480,059 2,821,328 1,580,405 203,329 --------- ---------- ---------- ---------- --------- REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS, FOREIGN CURRENCY, FUTURES CONTRACTS AND FORWARD FOREIGN CURRENCY CONTRACTS: Net realized gain/(loss) on: Investment transactions..... 3,924 (3,322,029) (1,146,358) - - Foreign currency, forward foreign currency contracts and options................ - (340,136) - - - Change in unrealized appreciation/(depreciation) on: Investments................. 228,763 7,259,822 759,341 - Translation of foreign currency and forward foreign currency contracts.................. - (26,116) - - - --------- ---------- ---------- ---------- --------- Net loss on investments, foreign currency and forward foreign currency contracts................. 232,687 3,571,541 (387,017) - - --------- ---------- ---------- ---------- --------- Net increase in net assets resulting from operations... $774,909 $7,051,600 $2,434,311 $1,580,405 $203,329 --------- ---------- ---------- ---------- ---------
- --------------------- /1/Includes the financial results of the AGSPC2 Municipal Money Market Fund, which was reorganized into North American Municipal Money Market Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 15 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2000 - -------------------------------------------------------------------------------
Aggressive Moderate Conservative Growth Growth Growth LifeStyle LifeStyle LifeStyle Fund/1/ Fund/2/ Fund/3/ ---------- ---------- ------------ INVESTMENT INCOME: Interest................................. $942 - $615 Dividends................................ 1,927,279 $1,409,608 1,116,617 ---------- ---------- ---------- Total income............................ 1,928,221 1,409,608 1,117,232 ---------- ---------- ---------- EXPENSES: Distribution for Class A................. 1,213 479 454 Distribution for Class B................. 29,870 26,882 24,671 Distribution for Class C................. 175 107 79 Investment adviser fee (Note 5).......... 17,053 16,346 15,126 ---------- ---------- ---------- Expenses before reimbursement by investment adviser...................... 48,311 43,814 40,330 Reimbursement of expenses by investment adviser (Note 5)........................ 15,187 12,863 12,047 ---------- ---------- ---------- Net expenses............................ 33,124 30,951 28,283 ---------- ---------- ---------- Net investment income................... 1,895,097 1,378,657 1,088,949 ---------- ---------- ---------- REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS Net realized gain/(loss) on: Investment transactions.................. 2,315,208 1,725,763 1,266,446 Change in unrealized appreciation/(depreciation) on: Investments.............................. (2,664,043) (1,594,261) (993,763) ---------- ---------- ---------- Net gain/(loss) on investments.......... (348,835) 131,502 272,683 ---------- ---------- ---------- Net increase in net assets resulting from operations............................... $1,546,262 $1,510,159 $1,361,632 ---------- ---------- ----------
- --------------------- /1/Includes the financial results of the AGSPC2 Aggressive Growth LifeStyle Fund, which was reorganized into North American Aggressive Growth LifeStyle Fund on July 7, 2000. /2/Includes the financial results of the AGSPC2 Moderate Growth LifeStyle Fund, which was reorganized into North American Moderate Growth LifeStyle Fund on July 7, 2000. /3/Includes the financial results of the AGSPC2 Conservative Growth LifeStyle Fund, which was reorganized into North American Conservative Growth LifeStyle Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 16 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Growth & Income Large Cap Growth Mid Cap Growth Fund Fund Fund ---------------------------- ------------------------- ------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/00 10/31/99 10/31/00 10/31/99 ------------ ------------ ----------- ----------- ----------- ----------- OPERATIONS: Net investment income (loss)................. ($2,757,563) ($1,248,402) ($924,855) ($560,560) ($1,121,488) ($725,375) Net realized gain (loss) on: Investment transactions........... 34,507,070 29,073,940 8,263,343 6,256,855 13,547,675 8,025,646 Futures contracts....... - - (12,436) - - - Foreign currency and forward foreign currency contracts..... - (244) (1,518) (2,574) (184) 8 Change in unrealized appreciation (depreciation) on: Investments............. (28,936,197) 27,366,787 (9,827,527) 2,622,980 1,554,570 1,370,689 Foreign currency and forward foreign currency contracts..... 12 153 (12) (7) (24) - ------------ ------------ ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations......... 2,813,322 55,192,234 (2,503,005) 8,316,694 13,980,549 8,670,968 DISTRIBUTIONS FROM: Net realized gains on investments and foreign currency transactions Class A................. (3,116,646) (1,712,771) (1,540,626) (265,199) (2,829,727) (460,517) Class B................. (9,002,149) (3,082,778) (5,453,064) (781,956) (8,060,558) (1,326,329) Class C................. (13,236,487) (4,839,860) (4,765,012) (851,533) (7,126,908) (1,510,893) Class I................. - - (1,547,819) - (1,875,158) - Return of capital Class A................. - - (13,112) - Class B................. - - (37,349) - Class C................. - - (33,023) - Class I................. - - (8,689) - Class II................ - - - - - - Increase/(decrease) in net assets from capital share transactions (Note 3)...................... 58,168,030 11,521,213 59,674,609 7,329,284 40,167,528 1,712,126 ------------ ------------ ----------- ----------- ----------- ----------- Increase/(decrease) in net assets.............. 35,626,070 57,078,038 43,865,083 13,747,290 34,163,553 7,085,355 Net assets at beginning of period............... 297,962,155 240,884,117 42,290,652 28,543,362 42,092,975 35,007,620 ------------ ------------ ----------- ----------- ----------- ----------- Net assets at end of period.................. $333,588,225 $297,962,155 $86,155,735 $42,290,652 $76,256,528 $42,092,975 ------------ ------------ ----------- ----------- ----------- ----------- Undistributed net investment income (loss).................. - - - - - - ------------ ------------ ----------- ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 17 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Science & Mid Cap Value Technology Small Cap Growth Fund/1/ Fund/2/ Fund ------------------------ ----------- ------------------------ Year Year 3/01/00* Year Year Ended Ended to Ended Ended 10/31/00 10/31/99 10/31/00 10/31/00 10/31/99 ----------- ---------- ----------- ----------- ---------- OPERATIONS: Net investment income (loss)................ ($56,913) $23,827 ($110,297) ($142,291) ($19,249) Net realized gain (loss) on: Investment transactions.......... 1,363,892 1,208,461 (1,715,633) 2,190,821 63,202 Foreign currency and forward foreign currency contracts.... - (2,189) - - Change in unrealized appreciation (depreciation) on: Investments............ 3,297,838 (338,721) (779,663) (4,046,826) 309,851 ----------- ---------- ----------- ----------- ---------- Net increase (decrease) in net assets resulting from operations........ 4,604,817 893,567 (2,607,782) (1,998,296) 353,804 DISTRIBUTIONS FROM: Net investment income Class A................ - (6,396) - - - Class B................ - (2,384) - - - Class C................ - - - - - Class I................ - (7,955) - - - Class II - (12,262) - - - Net realized gains on investments and foreign currency transactions Class A................ (379,796) - - (358,063) - Class B................ (1,040,334) - - (816,827) - Class C................ (29,983) - - (187,658) - Class I................ (845,335) - - (762,342) - Class II............... (181,253) - - - Increase/(decrease) in net assets from capital share transactions (Note 3)............... 10,957,731 8,378,333 24,674,261 41,638,630 323,343 ----------- ---------- ----------- ----------- ---------- Increase/(decrease) in net assets............. 13,085,847 9,242,903 22,066,479 37,515,444 677,147 Net assets at beginning of period.............. 9,246,853 3,950 - 1,324,331 647,184 ----------- ---------- ----------- ----------- ---------- Net assets at end of period................. $22,332,700 $9,246,853 $22,066,479 $38,839,775 $1,324,331 ----------- ---------- ----------- ----------- ---------- Undistributed net investment income (loss)................. - - ($1,715,633) - - ----------- ---------- ----------- ----------- ----------
- --------------------- * Commencement of operations /1/Includes the financial results of the AGSPC2 Mid Cap Value Fund, which was reorganized into North American Mid Cap Value Fund on July 7, 2000. /2/Includes the financial results of the AGSPC2 Science & Technology Fund, which was reorganized into North American Science & Technology Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 18 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Small Cap Index Socially Responsible Stock Index Fund/1/ Fund/2/ Fund/3/ ---------------------- ------------------------ ------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/00 10/31/99 10/31/00 10/31/99 ---------- ---------- ----------- ---------- ----------- ----------- OPERATIONS: Net investment income (loss)................ $58,408 $33,820 $63,275 $48,228 $169,521 $68,733 Net realized gain (loss) on: Investment transactions.......... 1,029,508 653,965 (33,597) 348,904 8,715 54,301 Futures contracts..... (27,491) - (41,626) - 164,278 - Change in unrealized appreciation (depreciation) on: Investments........... (367,543) (143,547) 212,439 763,646 678,065 1,473,041 Futures contracts..... (15,728) - (83,859) - (211,262) - ---------- ---------- ----------- ---------- ----------- ----------- Net increase (decrease) in net assets resulting from operations........ 677,154 544,238 116,632 1,160,778 809,317 1,596,075 DISTRIBUTIONS FROM: Net investment income Class A................ (32,955) (26,235) (9,931) (12,791) (52,418) (41,597) Class B................ (18,087) (6,614) (2,167) (2,406) (35,387) (25,119) Class C................ - - (1) - (19) - Class I................ - - (23,067) (15,583) - - Class II............... - - (7,932) (17,934) - - Net realized gains on investments and foreign currency transactions Class A................ (669,531) - (68,557) - (42,201) - Class B................ (858,236) - (132,478) - (114,330) - Class C................ (3,142) - - - - - Class I................ - - (85,308) - - - Class II............... - - (62,077) - - - Increase/(decrease) in net assets from capital share transactions (Note 3)............... 2,615,184 5,745,542 3,600,867 7,124,693 12,770,017 19,139,894 ---------- ---------- ----------- ---------- ----------- ----------- Increase/(decrease) in net assets............. 1,710,387 6,256,931 3,325,981 8,236,757 13,334,979 20,669,253 Net assets at beginning of period.............. 6,261,931 5,000 8,241,757 5,000 20,674,253 5,000 ---------- ---------- ----------- ---------- ----------- ----------- Net assets at end of period................. $7,972,318 $6,261,931 $11,567,738 $8,241,757 $34,009,232 $20,674,253 ---------- ---------- ----------- ---------- ----------- ----------- Undistributed net investment income (loss)................. $6,179 $971 $20,177 - $83,714 $2,017 ---------- ---------- ----------- ---------- ----------- -----------
- --------------------- /1/Includes the financial results of the AGSPC2 Small Cap Index Fund, which was reorganized into North American Small Cap Index Fund on July 7, 2000. /2/Includes the financial results of the AGSPC2 Socially Responsible Fund, which was reorganized into North American Socially Responsible Fund on July 7, 2000. /3/Includes the financial results of the AGSPC2 Stock Index Fund, which was reorganized into North American Stock Index Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 19 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Global Equity International Equity International Small Cap Fund Fund Fund ------------------------- ------------------------- --------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/00 10/31/99 10/31/00 10/31/99 ----------- ----------- ----------- ----------- ------------ ------------ OPERATIONS: Net investment income (loss)................ ($547,886) ($93,660) ($241,282) ($93,263) ($526,242) ($218,092) Net realized gain (loss) on: Investment transactions.......... (2,278,794) 15,363,203 6,800,924 2,202,524 2,239,050 4,674,222 Futures contracts...... - - (90,708) (105,083) - - Foreign currency and forward foreign currency contracts.... 592,673 (270,661) (99,012) (41,996) (237,008) (58,974) Change in unrealized appreciation (depreciation) on: Investments............ (9,923,239) (8,810,322) (10,872,098) 2,780,190 (1,519,207) 127,096 Futures contracts...... - - (14,920) (27,820) - - Foreign currency and forward foreign currency contracts.... (149,268) 365,478 548,727 152,371 (1,205) (958) ----------- ----------- ----------- ----------- ------------ ------------ Net increase (decrease) in net assets resulting from operations........ (12,306,514) 6,554,038 (3,968,369) 4,866,923 (44,612) 4,523,294 DISTRIBUTIONS FROM: Net investment income Class A................ - - (33,276) - - - Class B................ - - (19,674) - - - Class C................ - - (9,233) - - - Net realized gains on investments and foreign currency transactions Class A................ (1,483,161) (2,303,340) (307,060) (12,093) (662,245) - Class B................ (3,256,058) (2,219,820) (1,068,998) (44,312) (1,814,636) - Class C................ (5,705,060) (4,228,655) (499,719) (25,387) (1,423,034) - Increase/(decrease) in net assets from capital share transactions (Note 3)............... (22,339,662) (33,579,885) 28,059,117 (5,598,242) 15,806,860 (4,278,804) ----------- ----------- ----------- ----------- ------------ ------------ Increase/(decrease) in net assets............. (45,090,455) (35,777,662) 22,152,788 (813,111) 11,862,333 244,490 Net assets at beginning of period.............. 83,338,534 119,116,196 24,945,979 25,759,090 15,698,019 15,453,529 ----------- ----------- ----------- ----------- ------------ ------------ Net assets at end of period................. $38,248,079 $83,338,534 $47,098,767 $24,945,979 $27,560,352 $15,698,019 ----------- ----------- ----------- ----------- ------------ ------------ Undistributed net investment income (loss)................. $1,969 ($147,081) $6,160 $53,768 - - ----------- ----------- ----------- ----------- ------------ ------------
The accompanying notes are an integral part of the financial statements. 20 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Balanced Core Bond High Yield Bond Fund Fund Fund/1/ ------------------------- --------------------------- ------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/00 10/31/99 10/31/00 10/31/99 ----------- ----------- ------------ ----------- ----------- ----------- OPERATIONS: Net investment income (loss)................. $604,892 $1,525,974 $7,055,205 $937,686 $6,741,510 $5,380,873 Net realized gain (loss) on: Investment transactions........... (2,311,814) 9,063,680 (6,875,365) (205,464) (3,080,092) (710,603) Foreign currency and forward foreign currency contracts..... 52,789 (43,308) - - (132) - Change in unrealized appreciation (depreciation) on: Investments............. 4,340,304 (9,389,607) 5,847,043 (979,000) (3,547,402) (3,045,287) Foreign currency and forward foreign currency contracts..... (853) (920) - - - - ----------- ----------- ------------ ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations......... 2,685,318 1,155,819 6,026,883 (246,778) 113,884 1,624,983 DISTRIBUTIONS FROM: Net investment income Class A................. (155,664) (284,543) (207,981) (366,860) (19,839) (5,419) Class B................. (275,166) (243,851) (243,095) (279,710) (108,244) (24,330) Class C................. (1,059,003) (835,387) (192,049) (326,493) (6,579) - Class I................. (18) - (348,474) - (1,395) (4.874) Class II................ - - (5,963,986) - (6,393,004) (5,346,250) Net realized gains on investments and foreign currency transactions Class A................. (714,922) (1,061,187) - - - - Class B................. (1,649,177) (1,381,136) - - - - Class C................. (6,385,744) (4,691,171) - - - - Distributions in excess of net investment income Class A................. - - (4,740) - - - Class B................. - - (5,541) - - - Class C................. - - (4,377) - - - Class I................. - - (7,943) - - - Class II................ - - (135,934) - - - Return of Capital Class A................. - - (23,205) - - - Class B................. - - (27,123) - - - Class C................. - - (21,427) - - - Class I................. - - (38,880) - - - Class II................ - - (665,413) - - - Increase (decrease) in net assets from capital share transactions (Note 3)...................... 673,750 (17,488,266) 338,854,539 (3,491,641) 8,349,306 66,956,997 ----------- ----------- ------------ ----------- ----------- ----------- Increase (decrease) in net assets.............. (6,880,626) (24,829,722) 336,991,254 (4,711,482) 1,934,129 63,201,107 Net assets at beginning of period............... 73,562,936 98,392,658 12,394,748 17,106,230 63,206,107 5,000 ----------- ----------- ------------ ----------- ----------- ----------- Net assets at end of period.................. $66,682,310 $73,562,936 $349,386,002 $12,394,748 $65,140,236 $63,206,107 ----------- ----------- ------------ ----------- ----------- ----------- Undistributed net investment income (loss).................. $438,881 $1,271,183 ($509,240) ($20,882) $215,412 $1,323 ----------- ----------- ------------ ----------- ----------- -----------
- --------------------- /1/Includes the financial results of the AGSPC2 High Yield Bond Fund, which was reorganized into North American High Yield Bond Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 21 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Municipal Bond Strategic Income U. S. Government Securities Fund Fund Fund ------------------------- ------------------------- ----------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/00 10/31/99 10/31/00 10/31/99 ----------- ----------- ----------- ----------- ------------- ------------- OPERATIONS: Net investment income (loss)................ $542,222 $594,894 $3,480,059 $5,106,661 $2,821,328 $3,700,215 Net realized gain (loss) on: Investment transactions.......... 3,924 (75,958) (3,322,029) (3,377,733) (1,146,358) (821,237) Foreign currency and forward foreign currency contracts ... - - (340,136) (246,365) - - Change in unrealized appreciation (depreciation) on: Investments............ 228,763 (1,012,148) 7,259,822 (281,966) 759,341 (2,669,738) Foreign currency and forward foreign currency contracts ... - - (26,116) 255,346 - - ----------- ----------- ----------- ----------- ------------- ------------- Net increase (decrease) in net assets resulting from operations........ 774,909 (493,212) 7,051,600 1,455,943 2,434,311 209,240 DISTRIBUTIONS FROM : Net investment income Class A................ (241,752) (241,991) (563,766) (985,588) (1,814,535) (2,291,801) Class B................ (179,259) (182,925) (1,257,549) (2,027,623) (500,572) (622,804) Class C................ (120,948) (169,977) (1,150,833) (2,174,265) (442,305) (572,045) Class I................ - - (58,485) - - - Net realized gains on investments and foreign currency transactions Class A................ - - - (94,062) - - Class B................ - - - (189,150) - - Class C................ - - - (202,710) - - In excess of net investment income Class A................ - - (24,282) - - (166,512) Class B................ - - (54,164) - - (45,250) Class C................ - - (49,567) - - (41,562) Class I................ - - (2,519) - - - Return of capital Class A................ - - (78,951) - (119,523) (127,295) Class B................ - - (176,110) - (32,973) (34,593) Class C................ - - (161,165) - (29,135) (31,774) Class I ............... - - (8,190) - - - Increase/(decrease) in net assets from capital share transactions (Note 3)............... 3,691,639 (2,589,104) (17,290,100) (22,740,011) (13,043,070) (18,269,612) ----------- ----------- ----------- ----------- ------------- ------------- Increase/(decrease) in net assets............. 3,924,589 (3,677,209) (13,824,081) (26,957,466) (13,547,802) (21,994,008) Net assets at beginning of period.............. 12,562,521 16,239,730 51,086,038 78,043,504 58,188,373 80,182,381 ----------- ----------- ----------- ----------- ------------- ------------- Net assets at end of period................. $16,487,110 $12,562,521 $37,261,957 $51,086,038 $44,640,571 $58,188,373 ----------- ----------- ----------- ----------- ------------- ------------- Undistributed net investment income (loss)................. - ($263) ($1,756) ($94,527) ($433,764) ($488,884) ----------- ----------- ----------- ----------- ------------- -------------
The accompanying notes are an integral part of the financial statements. 22 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Money Market Municipal Money Market Fund Fund/1/ ------------------------- ------------------------ Year Year Year Year Ended Ended Ended Ended 10/31/00 10/31/99 10/31/00 10/31/99 ----------- ----------- ----------- ----------- OPERATIONS: Net investment income (loss)................ $1,580,405 $986,731 $203,329 $99,461 Net realized gain (loss) on: Investment transactions.......... - 572 - - ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations........ 1,580,405 987,303 203,329 99,461 DISTRIBUTIONS FROM: Net investment income Class A................ (772,737) (390,560) (132,291) (61,916) Class B................ (290,963) (226,689) (70,804) (37,545) Class C................ (407,623) (370,054) (234) - Class I................ (109,082) - - - Class II............... - - - - Increase (decrease) in net assets from capital share transactions (Note 3)............... 27,800,384 (5,226,114) 844,619 6,487,300 ----------- ----------- ----------- ----------- Increase (decrease) in net assets............. 27,800,384 (5,226,114) 844,619 6,487,300 Net assets at beginning of period.............. 19,225,098 24,451,212 6,492,300 5,000 ----------- ----------- ----------- ----------- Net assets at end of period................. $47,025,482 $19,225,098 $7,336,919 $6,492,300 ----------- ----------- ----------- ----------- Undistributed net investment income (loss)................. - - - - ----------- ----------- ----------- -----------
- --------------------- /1/Includes the financial results of the AGSPC2 Municipal Money Market Fund, which was reorganized into North American Municipal Money Market Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 23 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - -------------------------------------------------------------------------------
Aggressive Growth Moderate Growth Conservative Growth LifeStyle Fund/1/ LifeStyle Fund/2/ LifeStyle Fund/3/ ------------------------ ------------------------- ------------------------- Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/00 10/31/99 10/31/00 10/31/99 ----------- ---------- ----------- ----------- ----------- ----------- OPERATIONS: Net investment income (loss)................. $1,895,097 $43,845 $1,378,657 $98,624 $1,088,949 $144,689 Net realized gain (loss) on: Investment transactions........... 2,315,208 131,422 1,725,763 87,982 1,266,446 99,813 Change in unrealized appreciation (depreciation) on: Investments............ (2,664,043) 989,990 (1,594,261) 739,328 (993,763) 466,752 ----------- ---------- ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations......... 1,546,262 1,165,257 1,510,159 925,934 1,361,632 711,254 DISTRIBUTIONS FROM: Net investment income... Class A................. (226,879) (7,843) (169,786) (18,579) (124,818) (28,694) Class B................. (689,398) (13,419) (519,113) (35,672) (414,293) (52,880) Class C................. - - (187) - (67) - Class I................. (262,331) (7,389) (208,960) (18,006) (156,504) (25,850) Class II................ (52,621) (7,384) (48,561) (15,562) (42,954) (25,592) Net realized gains on investments and foreign currency transactions.. Class A................. (24,592) - (15,414) - (16,902) - Class B................. (68,467) - (48,559) - (57,065) - Class C................. - - - - - - Class I................. (19,815) - (12,830) - (14,923) - Class II................ (18,542) - (11,178) - (12,830) - Increase (decrease) in net assets from capital share transactions (Note 3)...................... 12,632,538 8,752,155 9,937,957 9,604,403 7,305,706 9,998,777 ----------- ---------- ----------- ----------- ----------- ----------- Increase (decrease) in net assets.............. 12,816,155 9,881,377 10,413,528 10,442,518 7,826,982 10,577,015 Net assets at beginning of period............... 9,886,377 5,000 10,447,518 5,000 10,582,015 5,000 ----------- ---------- ----------- ----------- ----------- ----------- Net assets at end of period.................. $22,702,532 $9,886,377 $20,861,046 $10,447,518 $18,408,997 $10,582,015 ----------- ---------- ----------- ----------- ----------- ----------- Undistributed net investment income (loss).................. $217,388 $7,810 $217,410 $10,805 $224,479 $11,673 ----------- ---------- ----------- ----------- ----------- -----------
- --------------------- /1/Includes the financial results of the AGSPC2 Aggressive Growth LifeStyle Fund, which was reorganized into North Aggressive Growth LifeStyle Fund on July 7, 2000. /2/Includes the financial results of the AGSPC2 Moderate Growth LifeStyle Fund, which was reorganized into North American Moderate Growth LifeStyle Fund on July 7, 2000. /3/Includes the financial results of the AGSPC2 Conservative Growth LifeStyle Fund, which was reorganized into North American Conservative Growth LifeStyle Fund on July 7, 2000. The accompanying notes are an integral part of the financial statements. 24 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Growth & Income Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00* 10/31/99* 10/31/98 10/31/97 10/31/96* - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $28.78 $24.26 $21.77 $17.56 $14.72 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.09) 0.03 0.08 0.14 0.18 Net realized and unrealized gain/(loss) on investments and foreign currency 0.80 5.45 4.14 5.26 2.99 --------------------------------------------------- Total from investment operations 0.71 5.48 4.22 5.40 3.17 --------------------------------------------------- Distributions Dividends from net investment income - - - (0.15) (0.21) Distributions from realized capital gains (2.43) (0.96) (1.70) (1.04) (0.12) Distributions in excess of net investment income - - (0.03) - - --------------------------------------------------- Total distributions (2.43) (0.96) (1.73) (1.19) (0.33) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $27.06 $28.78 $24.26 $21.77 $17.56 - -------------------------------------------------------------------------------- Total Return 2.39% 23.11% 20.82% 31.95% 21.84% - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $46,581 $37,210 $42,916 $34,186 $18,272 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.45% 1.34% 1.34% 1.34% 1.34% - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.33%) 0.11% 0.34% 0.66% 1.10% - -------------------------------------------------------------------------------- Portfolio turnover rate 31% 28% 18% 39% 49% - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.61% 1.49% 1.45% 1.50% 1.56% - --------------------------------------------------------------------------------
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Growth & Income Fund --------------------------------------------------- Class B --------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00* 10/31/99* 10/31/98 10/31/97 10/31/96* - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $28.28 $24.01 $21.67 $17.50 $14.69 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.26) (0.15) (0.07) 0.01 0.07 Net realized and unrealized gain/(loss) on investments and foreign currency 0.79 5.38 4.11 5.23 2.99 --------------------------------------------------- Total from investment operations 0.53 5.23 4.04 5.24 3.06 --------------------------------------------------- Distributions Dividends from net investment income - - - (0.03) (0.13) Distributions from realized capital gains (2.43) (0.96) (1.70) (1.04) (0.12) --------------------------------------------------- Total distributions (2.43) (0.96) (1.70) (1.07) (0.25) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $26.38 $28.28 $24.01 $21.67 $17.50 - -------------------------------------------------------------------------------- Total Return 1.75% 22.28% 20.04% 31.40% 21.08% - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $106,464 $104,695 $75,574 $54,871 $34,740 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.10% 1.99% 1.99% 1.99% 1.99% - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.97%) (0.54%) (0.32%) 0.01% 0.45% - -------------------------------------------------------------------------------- Portfolio turnover rate 31% 28% 18% 39% 49% - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.27% 2.13% 2.10% 2.15% 2.20% - --------------------------------------------------------------------------------
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 25 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Growth & Income Fund ----------------------------------------------------------------- Class C Class I ----------------------------------------------------- ---------- Year Year Year 7/10/00* Year Ended Year Ended Ended Ended Ended to 10/31/00** 10/31/99 ** 10/31/98 10/31/97 10/31/96 10/31/00** - --------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $28.39 $24.10 $21.75 $17.56 $14.71 $28.25 - --------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.27) (0.15) (0.07) 0.01 0.07 (0.02) Net realized and unrealized gain/(loss) on investments and foreign currency 0.80 5.40 4.12 5.25 3.00 (1.12) ------------------------------------------------------- Total from investment operations 0.53 5.25 4.05 5.26 3.07 (1.14) ------------------------------------------------------- Distributions Dividends from net investment income - - - (0.03) (0.10) Distributions from realized capital gains (2.43) (0.96) (1.70) (1.04) (0.12) ------------------------------------------------------- Total distributions (2.43) (0.96) (1.70) (1.07) (0.22) - --------------------------------------------------------------------------------------------- Net Asset Value, End of Period $26.49 $28.39 $24.10 $21.75 $17.56 $27.11 - --------------------------------------------------------------------------------------------- Total Return 1.74% 22.28% 20.00% 31.37% 21.12% (4.04%)+ - --------------------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------------------- Net assets, end of period (000's) $170,277 $156,056 $122,395 $98,250 $74,825 $10,267 - --------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.10% 1.99% 1.99% 1.99% 1.99% 1.27%# - --------------------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.97%) (0.54%) (0.31%) 0.01% 0.45% (0.26%)# - --------------------------------------------------------------------------------------------- Portfolio turnover rate 31% 28% 18% 39% 49% 31%+ - --------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.27% 2.13% 2.10% 2.13% 2.20% 1.44%# - ---------------------------------------------------------------------------------------------
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Large Cap Growth Fund (formerly Growth Equity Fund) ----------------------------------------------------- Class A ----------------------------------------------------- Year Year 3/04/96* Year Ended Year Ended Ended Ended to 10/31/00** 10/31/99 ** 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $21.44 $17.73 $17.01 $13.78 $12.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.21) (0.19) (0.07) (0.03) 0.28 Net realized and unrealized gain/(loss) on investments and foreign currency 1.72 5.05 2.22 3.45 1.00 ---------------------------------- Total from investment operations 1.51 4.86 2.15 3.42 1.28 ---------------------------------- Distributions Dividends from net investment income - - - (0.19) - Distributions from realized capital gains (4.66) (1.15) (1.43) - - ---------------------------------- Total distributions (4.66) (1.15) (1.43) (0.19) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $18.29 $21.44 $17.73 $17.01 $13.78 - -------------------------------------------------------------------------------- Total Return 5.66% 28.57% 13.85% 25.13% 10.24%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $9,548 $5,656 $3,919 $3,053 $2,244 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.51% 1.65% 1.65% 1.65% 1.65%# - -------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (0.93%) (0.94) (0.43%) (0.17%) 4.11%# - -------------------------------------------------------------------------------- Portfolio turnover rate 196% 145% 115% 181% 450%# - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.85% 1.90% 1.91% 2.28% 2.71%# - --------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 26 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Large Cap Growth Fund (formerly Growth Equity Fund) ----------------------------------------------------- Class B ----------------------------------------------------- Year Year 3/04/96* Year Ended Year Ended Ended Ended to 10/31/00** 10/31/99 ** 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $20.96 $17.46 $16.90 $13.73 $12.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.34) (0.31) (0.18) (0.13) 0.24 Net realized and unrealized gain/(loss) on investments and foreign currency 1.70 4.96 2.17 3.46 0.99 --------------------------------------------------- Total from investment operations 1.36 4.65 1.99 3.33 1.23 --------------------------------------------------- Distributions Dividends from net investment income - - - (0.16) - Distributions from realized capital gains (4.66) (1.15) (1.43) - - --------------------------------------------------- Total distributions (4.66) (1.15) (1.43) (0.16) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $17.66 $20.96 $17.46 $16.90 $13.73 - -------------------------------------------------------------------------------- Total Return 5.01% 27.77% 12.93% 24.50% 9.84%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $34,711 $17,171 $11,659 $9,040 $4,748 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.15% 2.30% 2.30% 2.30% 2.30%# - -------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (1.57%) (1.58%) (1.07%) (0.82%) 4.18%# - -------------------------------------------------------------------------------- Portfolio turnover rate 196% 145% 115% 181% 450%# - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.50% 2.52% 2.56% 2.78% 3.06%# - --------------------------------------------------------------------------------
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Large Cap Growth Fund (formerly Growth Equity Fund) ---------------------------------------------------------------- Class C Class I ---------------------------------------------------- ---------- Year Year 3/04/96* 7/10/00* Year Ended Year Ended Ended Ended to to 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96 10/31/00** - -------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $20.93 $17.44 $16.89 $13.73 $12.50 $22.08 - -------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.35) (0.31) (0.20) (0.13) 0.24 (0.03) Net realized and unrealized gain/(loss) on investments and foreign currency 1.72 4.95 2.18 3.46 0.99 (1.93) ------------------------------------------------------------- Total from investment operations 1.37 4.64 1.98 3.33 1.23 (1.96) ------------------------------------------------------------- Distributions Dividends from net investment income - - - (0.17) - Distributions from realized capital gains (4.66) (1.15) (1.43) - - (1.70) ------------------------------------------------------------- Total distributions (4.66) (1.15) (1.43) (0.17) (1.70) - -------------------------------------------------------------------------------------------- Net Asset Value, End of Period $17.64 $20.93 $17.44 $16.89 $13.73 $18.42 - -------------------------------------------------------------------------------------------- Total Return 5.06% 27.75% 12.87% 24.50% 9.84%+ (9.04%)+ - -------------------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------------------- Net assets, end of period (000's) $22,780 $19,463 $12,965 $12,766 $6,494 $19,117 - -------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.23% 2.30% 2.30% 2.30% 2.30%# 1.07%# - -------------------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (1.64%) (1.58%) (1.06%) (0.82%) 4.13%# (0.47%)# - -------------------------------------------------------------------------------------------- Portfolio turnover rate 196% 145% 115% 181% 450%# 196%+ - -------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.52% 2.52% 2.56% 2.75% 2.96%# 1.64%# - --------------------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 27 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Mid Cap Growth Fund (formerly Small/Mid Cap Fund) ---------------------------------------------------- Class A ---------------------------------------------------- Year Year Year Year 3/04/96* Ended Ended Ended Ended to 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.52 $16.09 $15.51 $12.62 $12.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.27) (0.21) (0.15) (0.14) (0.02) Net realized and unrealized gain/(loss) on investments and foreign currency 6.33 4.12 0.97 3.03 0.14 ---------------------------------------------------- Total from investment operations 6.06 3.91 0.82 2.89 0.12 ---------------------------------------------------- Distributions Distributions from realized capital gains (6.68) (1.48) (0.24) - - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $17.90 $18.52 $16.09 $15.51 $12.62 - -------------------------------------------------------------------------------- Total Return 35.03% 25.50% 5.51% 22.90% 0.96%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $11,718 $5,970 $4,814 $4,170 $2,966 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.59% 1.68% 1.68% 1.68% 1.68%# - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (1.30%) (1.15%) (0.90%) (1.02%) (0.40%)# - -------------------------------------------------------------------------------- Portfolio turnover rate 210% 181% 162% 145% 92%# - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.88% 1.89% 1.93% 2.24% 2.69%# - --------------------------------------------------------------------------------
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Mid Cap Growth Fund (formerly Small/Mid Cap Fund) ------------------------------------------------------ Class B ------------------------------------------------------ Year Year Year Year 3/04/96* Ended Ended Ended Ended to 10/31/00** 10/31/99** 10/31/98 10/31/97** 10/31/96 - ---------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.99 $15.77 $15.33 $12.58 $12.50 - ---------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.41) (0.32) (0.25) (0.23) (0.05) Net realized and unrealized gain/(loss) on investments and foreign currency 6.13 4.02 0.93 2.98 0.13 ------------------------------------------------------ Total from investment operations 5.72 3.70 0.68 2.75 0.08 ------------------------------------------------------ Distributions Distributions from realized capital gains (6.68) (1.48) (0.24) - - - ---------------------------------------------------------------------------------- Net Asset Value, End of Period $17.03 $17.99 $15.77 $15.33 $12.58 - ---------------------------------------------------------------------------------- Total Return 34.04% 24.62% 4.65% 21.86% 0.64%+ - ---------------------------------------------------------------------------------- Ratios/Supplemental Data - ---------------------------------------------------------------------------------- Net assets, end of period (000's) $29,978 $17,184 $13,972 $11,802 $6,659 - ---------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.31% 2.33% 2.33% 2.33% 2.33%# - ---------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (2.01%) (1.80%) (1.55%) (1.67%) (1.05%)# - ---------------------------------------------------------------------------------- Portfolio turnover rate 210% 181% 162% 145% 92%# - ---------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.54% 2.54% 2.58% 2.79% 3.05%# - ----------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 28 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Mid Cap Growth Fund (formerly Small/Mid Cap Fund) ------------------------------------------------------------------- Class C Class I ------------------------------------------------------ ---------- Year Year Year Year 3/04/96* 7/10/00* Ended Ended Ended Ended to to 10/31/00** 10/31/99** 10/31/98 10/31/97** 10/31/96 10/31/00** - ----------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.02 $15.79 $15.35 $12.59 $12.50 $21.70 - ----------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.41) (0.32) (0.25) (0.23) (0.05) (0.08) Net realized and unrealized gain/(loss) on investments and foreign currency 6.13 4.03 0.93 2.99 0.14 (0.15) ------------------------------------------------------------------- Total from investment operations 5.72 3.71 0.68 2.76 0.09 (0.23) ------------------------------------------------------------------- Distributions Distributions from realized capital gains (6.68) (1.48) (0.24) - - (3.50) - ----------------------------------------------------------------------------------------------- Net Asset Value, End of Period $17.06 $18.02 $15.79 $15.35 $12.59 $17.97 - ----------------------------------------------------------------------------------------------- Total Return 33.95% 24.65% 4.64% 21.92% 0.72%+ (0.85%)+ - ----------------------------------------------------------------------------------------------- Ratios/Supplemental Data - ----------------------------------------------------------------------------------------------- Net assets, end of period (000's) $22,913 $18,939 $16,221 $13,471 $8,241 $11,647 - ----------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.33% 2.33% 2.33% 2.33% 2.33%# 1.37%# - ----------------------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (2.02%) (1.80%) (1.55%) (1.67%) (1.05%)# (1.14%)# - ----------------------------------------------------------------------------------------------- Portfolio turnover rate 210% 181% 162% 145% 92%# 210%+ - ----------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.54% 2.54% 2.58% 2.78% 3.04%# 1.67%# - -----------------------------------------------------------------------------------------------
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Mid Cap Value Fund/1/ ---------------------------------------------------------------------------- Class A Class B Class C Class I -------------------- -------------------- ---------- -------------------- Year Year Year Year 7/31/00* Year Year Ended Ended Ended Ended to Ended Ended 10/31/00** 10/31/99 10/31/00** 10/31/99 10/31/00** 10/31/00** 10/31/99 - ------------------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.98 $10.00 $11.85 $10.00 $12.88 $11.95 $10.00 - ------------------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) - 0.06 (0.09) - (0.05) (0.02) 0.07 Net realized and unrealized gain/(loss) on investments and foreign currency 3.87 1.97 3.79 1.87 1.23 3.89 1.94 ---------------------------------------------------------------------------- Total from investment operations 3.87 2.03 3.70 1.87 1.18 3.87 2.01 ---------------------------------------------------------------------------- Distributions Dividends from net investment income - (0.05) - (0.02) - (0.06) Distributions from realized capital gains (2.24) (2.24) (0.80) (2.24) ---------------------------------------------------------------------------- Total distributions (2.24) (0.05) (2.24) (0.02) (0.80) (2.24) (0.06) - ------------------------------------------------------------------------------------------------------- Net Asset Value, End of Period $13.61 $11.98 $13.31 $11.85 $13.26 $13.58 $11.95 - ------------------------------------------------------------------------------------------------------- Total Return 35.42% 20.23% 34.26% 18.71% 9.53%+ 36.17% 20.18% - ------------------------------------------------------------------------------------------------------- Ratios/Supplemental Data - ------------------------------------------------------------------------------------------------------- Net assets, end of period (000's) $2,747 $1,728 $7,471 $4,555 $614 $11,501 $1,507 - ------------------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.45% 1.29% 2.17% 2.04% 2.31%# 1.49% 1.17% - ------------------------------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (0.04%) 0.51% (0.75%) (0.26%) (1.18%)# (0.17%) 0.64% - ------------------------------------------------------------------------------------------------------- Portfolio turnover rate 191% 177% 191% 177% 191%+ 191% 177% - ------------------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.95% 2.43% 2.67% 2.77% 2.37%# 1.78% 2.51% - -------------------------------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Mid Cap Value Fund, which was reorganized into North American Mid Cap Value Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 29 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Science & Technology Fund/1/ ------------------------------------------------- Class A Class B Class C Class I ---------- ---------- ---------- ---------- 3/01/00* 3/01/00* 7/12/00* 3/01/00* to to to to 10/31/00** 10/31/00** 10/31/00** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.00 $10.00 $8.48 $10.00 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.04) (0.07) (0.03) (0.03) Net realized and unrealized gain/(loss) on investments and foreign currency (1.88) (1.90) (0.63) (1.89) ------------------------------------------------- Total from investment operations (1.92) (1.97) (0.66) (1.92) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $8.08 $8.03 $7.82 $8.08 - -------------------------------------------------------------------------------- Total Return (19.20%)+ (19.70%)+ (7.78%)+ (19.20%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $4,623 $15,840 $1,065 $539 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.24%# 1.91%# 1.71%# 1.20%# - -------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (0.64%)# (1.37%)# (1.11%)# (0.48%)# - -------------------------------------------------------------------------------- Portfolio turnover rate 120%+ 120%+ 120%+ 120%+ - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.92%# 2.59%# 2.37%# 1.88%# - --------------------------------------------------------------------------------
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Small Cap Growth Fund (formerly Emerging Growth Fund) --------------------------------------------- Class A Class I -------------------------------- ---------- Year Year 1/06/98* 7/10/00* Ended Ended to to 10/31/00** 10/31/99** 10/31/98 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.81 $8.88 $10.00 $19.82 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.12) (0.15) (0.08) (0.07) Net realized and unrealized gain/(loss) on investments and foreign currency 5.66 4.08 (1.04) (1.42) --------------------------------------------- Total from investment operations 5.54 3.93 (1.12) (1.49) Distributions Distributions from realized capital gains (1.08) (1.00) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $17.27 $12.81 $8.88 $17.33 - -------------------------------------------------------------------------------- Total Return 43.62% 44.26% (11.20%)+ (7.34%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $6,795 $224 $146 $14,154 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.35% 1.70% 1.70%# 1.11%# - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.66%) (1.43%) (1.00%)# (0.37%)# - -------------------------------------------------------------------------------- Portfolio turnover rate 222% 129% 52%+ 222%+ - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.10% 6.96% 15.48%# 1.69%# - --------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Science & Technology Fund, which was reorganized into North American Science & Technology Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average month- end share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 30 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Small Cap Growth Fund (formerly Emerging Growth Fund) ------------------------------------------------------------------- Class B Class C -------------------------------- -------------------------------- Year Year 1/06/98* Year Year 1/06/98* Ended Ended to Ended Ended to 10/31/00** 10/31/99** 10/31/98 10/31/00** 10/31/99** 10/31/98 - ----------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.57 $8.83 $10.00 $12.57 $8.84 $10.00 - ----------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.24) (0.21) (0.12) (0.29) (0.21) (0.12) Net realized and unrealized gain/(loss) on investments and foreign currency 5.55 3.95 (1.05) 5.59 3.94 (1.04) ------------------------------------------------------------------- Total from investment operations 5.31 3.74 (1.17) 5.30 3.73 (1.16) ------------------------------------------------------------------- Distributions Distributions from realized capital gains (1.08) (1.08) - ----------------------------------------------------------------------------------------------- Net Asset Value, End of Period $16.80 $12.57 $8.83 $16.79 $12.57 $8.84 - ----------------------------------------------------------------------------------------------- Total Return 42.62% 42.36% (11.70%)+ 42.54% 42.19% (11.60%)+ - ----------------------------------------------------------------------------------------------- Ratios/Supplemental Data - ----------------------------------------------------------------------------------------------- Net assets, end of period (000's) $14,554 $660 $263 $3,337 $440 $238 - ----------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.00% 2.35% 2.35%# 2.21% 2.35% 2.35%# - ----------------------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (1.31%) (2.04%) (1.76%)# (1.56%) (2.03%) (1.67%)# - ----------------------------------------------------------------------------------------------- Portfolio turnover rate 222% 129% 52%# 222% 129% 52%# - ----------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.75% 7.58% 16.48%# 3.17% 7.60% 15.78%# - -----------------------------------------------------------------------------------------------
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Small Cap Index Fund/1/ ------------------------------------------------------ Class A Class B Class C -------------------- -------------------- ---------- Year Year Year Year 8/23/00* Ended Ended Ended Ended to 10/31/00** 10/31/99 10/31/00** 10/31/99 10/31/00** - ---------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.03 $10.00 $11.03 $10.00 $11.56 - ---------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.13 0.10 0.05 0.02 - Net realized and unrealized gain/(loss) on investments and foreign currency 1.08 1.03 1.07 1.03 (0.43) ------------------------------------------------------ Total from investment operations 1.21 1.13 1.12 1.05 (0.43) ------------------------------------------------------ Distributions Dividends from net investment income (0.11) (0.10) (0.05) (0.02) - Distributions from realized capital gains (2.34) - (2.34) - (1.25) ------------------------------------------------------ Total distributions (2.45) (0.10) (2.39) (0.02) (1.25) - ---------------------------------------------------------------------------------- Net Asset Value, End of Period $9.79 $11.03 $9.76 $11.03 $9.88 - ---------------------------------------------------------------------------------- Total Return 11.74% 11.32% 10.83% 10.53% (3.07%)+ - ---------------------------------------------------------------------------------- Ratios/Supplemental Data - ---------------------------------------------------------------------------------- Net assets, end of period (000's) $3,361 $2,900 $4,574 $3,361 $38 - ---------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.89% 0.83% 1.61% 1.58% 1.64%# - ---------------------------------------------------------------------------------- Ratio of net investment income to average net assets 1.15% 0.97% 0.43% 0.23% 0.17%# - ---------------------------------------------------------------------------------- Portfolio turnover rate 63% 48% 63% 48% 63%+ - ---------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.19% 1.69% 1.91% 2.37% 2.02%# - ----------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Small Cap Index Fund, which was reorganized into North American Small Cap Index Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average month- end share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 31 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Socially Responsible Fund/1/ ------------------------------------------ Class A Class B -------------------- -------------------- Year Year Year Year Ended Ended Ended Ended 10/31/00** 10/31/99 10/31/00** 10/31/99 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.15 $10.00 $12.13 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.10 0.10 0.01 0.02 Net realized and unrealized gain/(loss) on Investments and foreign currency 0.21 2.15 0.23 2.13 ------------------------------------------ Total from investment operations 0.31 2.25 0.24 2.15 ------------------------------------------ Distributions Dividends from net investment income (0.06) (0.10) (0.01) (0.02) Distributions from realized capital gains (0.49) - (0.49) - ------------------------------------------ Total distributions (0.55) (0.10) (0.50) (0.02) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $11.91 $12.15 $11.87 $12.13 - --------------------------------------------------------------------------------- Total Return 2.53% 22.53%+ 1.88% 21.50%+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $1,896 $1,663 $3,649 $2,943 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.94% 0.80% 1.65% 1.55% - --------------------------------------------------------------------------------- Ratio of net investment income to average net assets 0.81% 0.87% 0.10% 0.09% - --------------------------------------------------------------------------------- Portfolio turnover rate 52% 24% 52% 24% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.24% 1.97% 1.96% 2.49% - ---------------------------------------------------------------------------------
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Socially Responsible Fund/1/ --------------------------------- Class C Class I ---------- -------------------- 7/28/00* Year Year to Ended Ended 10/31/00** 10/31/00** 10/31/99 - ------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $12.09 $12.16 $10.00 - ------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) (0.01) 0.11 0.11 Net realized and unrealized gain/(loss) on Investments and foreign currency 0.23 2.16 --------------------------------- Total from investment operations (0.01) 0.34 2.27 --------------------------------- Distributions Dividends from net investment income (0.01) (0.08) (0.11) Distributions from realized capital gains - (0.49) - --------------------------------- Total distributions (0.01) (0.57) (0.11) - ------------------------------------------------------------------------------ Net Asset Value, End of Period $12.07 $11.93 $12.16 - ------------------------------------------------------------------------------ Total Return (0.11%)+ 2.72% 22.73% - ------------------------------------------------------------------------------ Ratios/Supplemental Data - ------------------------------------------------------------------------------ Net assets, end of period (000's) $57 $5,966 $2,098 - ------------------------------------------------------------------------------ Ratio of total expenses to average net assets 2.23%# 0.88% 0.68% - ------------------------------------------------------------------------------ Ratio of net investment income/(loss) to average net assets (0.17%)# 0.97% 0.97% - ------------------------------------------------------------------------------ Portfolio turnover rate 52%+ 52% 24% - ------------------------------------------------------------------------------ Expense ratio before expense reimbursement by advisor 2.23%# 1.25% 1.89% - ------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Socially Responsible Fund, which was reorganized into North American Socially Responsible Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average month-end share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 32 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Stock Index Fund/1/ ------------------------------------------------------ Class A Class B Class C -------------------- -------------------- ---------------- Year Year Year Year 7/17/00* Ended Ended Ended Ended to 10/31/00** 10/31/99 10/31/00** 10/31/99 10/31/00** - -------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.32 $10.00 $12.23 $10.00 $13.38 - -------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.14 0.11 0.05 0.02 0.01 Net realized and unrealized gain/(loss) on investments and foreign currency 0.47 2.32 0.46 2.23 (0.83) ------------------------------------------------------ Total from investment operations 0.61 2.43 0.51 2.25 (0.82) ------------------------------------------------------ Distributions Dividends from net investment income (0.10) (0.11) (0.02) (0.02) (0.01) Distributions from realized capital gains (0.08) - (0.08) - ------------------------------------------------------ Total distributions (0.18) (0.11) (0.10) (0.02) (0.01) - -------------------------------------------------------------------------------------- Net Asset Value, End of Period $12.75 $12.32 $12.64 $12.23 $12.55 - -------------------------------------------------------------------------------------- Total Return 4.91% 24.36% 4.21% 22.55% (5.21%)+ - -------------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------------- Net assets, end of period (000's) $8,543 $5,634 $24,966 $15,040 $500 - -------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.78% 0.82% 1.49% 1.57% 1.35%# - -------------------------------------------------------------------------------------- Ratio of net investment income to average net assets 1.12% 1.08% 0.42% 0.37% 0.30%# - -------------------------------------------------------------------------------------- Portfolio turnover rate 2% 14% 2% 14% 2%+ - -------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.12% 1.53% 1.83% 1.98% 1.84%# - --------------------------------------------------------------------------------------
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Global Equity Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $16.12 $16.43 $16.32 $14.50 $13.84 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.06) 0.08 0.02 0.06 (0.04) Net realized and unrealized gain/(loss) on investments and foreign currency (2.86) 0.82 1.34 3.45 0.91 --------------------------------------------------- Total from investment operations (2.92) 0.90 1.36 3.51 0.87 --------------------------------------------------- Distributions Dividends from net investment income - - (0.22) (0.05) (0.21) Distributions from realized capital gains (2.14) (1.21) (1.03) (1.64) - --------------------------------------------------- Total distributions (2.14) (1.21) (1.25) (1.69) (0.21) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $11.06 $16.12 $16.43 $16.32 $14.50 - -------------------------------------------------------------------------------- Total Return (21.08)% 5.60% 8.90% 26.10% 6.33% - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $8,610 $12,757 $31,055 $30,960 $25,924 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.86% 1.75% 1.75% 1.75% 1.75% - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.42%) 0.47% 0.09% 0.33% (0.30%) - -------------------------------------------------------------------------------- Portfolio turnover rate 207% 38% 20% 28% 165% - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.06% 1.84% 1.75% 1.81% 1.83% - --------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Stock Index Fund, which was reorganized into North American Stock Index Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average month- end share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 33 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Global Equity Fund -------------------------------------------------- Class B -------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $15.83 $16.24 $16.14 $14.36 $13.73 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.04) (0.11) (0.05) (0.14) Net realized and unrealized gain/(loss) on investments and foreign currency (2.78) 0.84 1.35 3.47 0.91 ------------------------------------------------- Total from investment operations (2.92) 0.80 1.24 3.42 0.77 - -------------------------------------------------------------------------------- Distributions Dividends from net investment income - - (0.11) (0.14) Distributions from realized capital gains (2.14) (1.21) (1.03) (1.64) - ------------------------------------------------- Total distributions (2.14) (1.21) (1.14) (1.64) (0.14) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.77 $15.83 $16.24 $16.14 $14.36 - -------------------------------------------------------------------------------- Total Return (21.44%) 5.01% 8.17% 25.63% 5.64% - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $10,089 $25,381 $30,287 $31,833 $25,661 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.51% 2.40% 2.40% 2.40% 2.40% - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (1.04%) (0.25%) (0.55%) (0.32%) (0.95%) - -------------------------------------------------------------------------------- Portfolio turnover rate 207% 38% 20% 28% 165% - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.71% 2.50% 2.40% 2.47% 2.48% - --------------------------------------------------------------------------------
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Global Equity Fund -------------------------------------------------- Class C -------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $15.89 $16.30 $16.19 $14.41 $13.73 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.04) (0.10) (0.05) (0.14) Net realized and unrealized gain/(loss) on investments and foreign currency (2.79) 0.84 1.35 3.47 0.92 ------------------------------------------------- Total from investment operations (2.93) 0.80 1.25 3.42 0.78 - -------------------------------------------------------------------------------- Distributions Dividends from net investment income - - (0.11) - (0.10) Distributions from realized capital gains (2.14) (1.21) (1.03) (1.64) - ------------------------------------------------- Total distributions (2.14) (1.21) (1.14) (1.64) (0.10) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.82 $15.89 $16.30 $16.19 $14.41 - -------------------------------------------------------------------------------- Total Return (21.42%) 4.99% 8.21% 25.54% 5.70% - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $19,549 $45,201 $57,774 $61,245 $64,830 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.51% 2.40% 2.40% 2.40% 2.40% - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (1.05%) (0.24%) (0.56%) (0.32%) (0.95%) - -------------------------------------------------------------------------------- Portfolio turnover rate 207% 38% 20% 28% 165% - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.71% 2.50% 2.40% 2.46% 2.48% - --------------------------------------------------------------------------------
** Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 34 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
International Equity Fund -------------------------------------------------------- Class A -------------------------------------------------------- Year Year Ended Year Ended Ended Year Ended Year Ended 10/31/00** 10/31/99** 10/31/98 10/31/97** 10/31/96** - ----------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.89 $9.83 $10.81 $11.35 $10.11 - ----------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.03) 0.02 0.03 0.06 0.09 Net realized and unrealized gain/(loss) on investments and foreign currency (0.35) 2.07 0.02 0.35 1.33 -------------------------------------------------------- Total from investment operations (0.38) 2.09 0.05 0.41 1.42 -------------------------------------------------------- Distributions Dividends from net investment income (0.10) - (0.13) (0.19) (0.08) Distributions from realized capital gains (0.92) (0.03) (0.90) (0.76) (0.10) -------------------------------------------------------- Total distributions (1.02) (0.03) (1.03) (0.95) (0.18) - ----------------------------------------------------------------------------------- Net Asset Value, End of Period $10.49 $11.89 $9.83 $10.81 $11.35 - ----------------------------------------------------------------------------------- Total Return (4.00%) 21.33% 0.67% 3.55% 14.25% - ----------------------------------------------------------------------------------- Ratios/Supplemental Data - ----------------------------------------------------------------------------------- Net assets, end of period (000's) $7,471 $3,997 $3,769 $4,461 $4,732 - ----------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.71% 1.75% 1.75% 1.75% 1.75% - ----------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.27%) 0.18% 0.44% 0.97% 0.84% - ----------------------------------------------------------------------------------- Portfolio turnover rate 126% 142% 173% 146% 170% - ----------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.02% 1.98% 1.87% 1.96% 1.97% - -----------------------------------------------------------------------------------
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International Equity Fund -------------------------------------------------------- Class B -------------------------------------------------------- Year Year Ended Year Ended Ended Year Ended Year Ended 10/31/00** 10/31/99** 10/31/98 10/31/97** 10/31/96** - ----------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.74 $9.77 $10.75 $11.30 $10.10 - ----------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.11) (0.05) (0.02) 0.03 0.06 Net realized and unrealized gain/(loss) on investments and foreign currency (0.35) 2.05 0.00 0.31 1.30 -------------------------------------------------------- Total from investment operations (0.46) 2.00 (0.02) 0.34 1.36 -------------------------------------------------------- Distributions Dividends from net investment income (0.02) - (0.06) (0.13) (0.05) Distributions from realized capital gains (0.92) (0.03) (0.90) (0.76) (0.11) -------------------------------------------------------- Total distributions (0.94) (0.03) (0.96) (0.89) (0.16) - ----------------------------------------------------------------------------------- Net Asset Value, End of Period $10.34 $11.74 $9.77 $10.75 $11.30 - ----------------------------------------------------------------------------------- Total Return (4.78%) 20.53% (0.03%) 2.92% 13.58% - ----------------------------------------------------------------------------------- Ratios/Supplemental Data - ----------------------------------------------------------------------------------- Net assets, end of period (000's) $18,204 $14,269 $14,030 $16,334 $15,217 - ----------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.38% 2.40% 2.40% 2.40% 2.40% - ----------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.96%) (0.45%) (0.18%) 0.32% 0.57% - ----------------------------------------------------------------------------------- Portfolio turnover rate 126% 142% 173% 146% 170% - ----------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.66% 2.63% 2.52% 2.54% 2.60% - -----------------------------------------------------------------------------------
** Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 35 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
International Equity Fund -------------------------------------------------------------------- Class C Class I -------------------------------------------------------- ---------- Year Year Year Year Year 7/10/00* Ended Ended Ended Ended Ended to 10/31/00** 10/31/99** 10/31/98 10/31/97** 10/31/96** 10/31/00** - ----------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.74 $9.77 $10.76 $11.31 $10.10 $ 11.74 - ----------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.11) (0.05) (0.02) 0.03 0.06 (0.01) Net realized and unrealized gain/(loss) on investments and foreign currency (0.38) 2.05 (0.01) 0.31 1.30 (1.26) -------------------------------------------------------------------- Total from investment operations (0.49) 2.00 (0.03) 0.34 1.36 (1.27) -------------------------------------------------------------------- Distributions Dividends from net investment income (0.02) - (0.06) (0.13) (0.05) Distributions from realized capital gains (0.92) (0.03) (0.90) (0.76) (0.10) -------------------------------------------------------------------- Total distributions (0.94) (0.03) (0.96) (0.89) (0.15) - ----------------------------------------------------------------------------------------------- Net Asset Value, End of Period $10.31 $11.74 $9.77 $10.76 $11.31 $ 10.47 - ----------------------------------------------------------------------------------------------- Total Return (5.05%) 20.53% (0.13%) 2.91% 13.63% (10.82%)+ - ----------------------------------------------------------------------------------------------- Ratios/Supplemental Data - ----------------------------------------------------------------------------------------------- Net assets, end of period (000's) $4,765 $6,680 $7,960 $8,460 $9,076 $ 16,656 - ----------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.43% 2.40% 2.40% 2.40% 2.40%# 1.39%# - ----------------------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets (0.96%) (0.49%) (0.19%) 0.32% 0.51%# (0.19%)# - ----------------------------------------------------------------------------------------------- Portfolio turnover rate 126% 142% 173% 146% 170% 126% - ----------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.68% 2.62% 2.52% 2.57% 2.60%# 1.83%# - -----------------------------------------------------------------------------------------------
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International Small Cap Fund ---------------------------------------------------- Class A ---------------------------------------------------- Year Year 3/04/96* Year Ended Year Ended Ended Ended to 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.83 $13.91 $13.86 $13.43 $12.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.30) (0.14) (0.02) (0.03) 0.05 Net realized and unrealized gain/(loss) on investments and foreign currency 5.35 5.06 0.07 0.46 0.88 -------------------------------------------------- Total from investment operations 5.05 4.92 0.05 0.43 0.93 -------------------------------------------------- Distributions Distributions from realized capital gains (4.67) - - - - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $19.21 $18.83 $13.91 $13.86 $13.43 - -------------------------------------------------------------------------------- Total Return 23.34% 35.37% 0.36% 3.20% 7.44%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $6,003 $2,309 $2,173 $3,225 $2,120 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.97% 1.90% 1.90% 1.90% 1.90%# - -------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (1.21%) (0.87%) (0.12%) (0.19%) (0.50%)# - -------------------------------------------------------------------------------- Portfolio turnover rate 537% 202% 54% 75% 67%# - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.21% 2.24% 2.23% 2.46% 3.07%# - --------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 36 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
International Small Cap Fund -------------------------------------------------- Class B -------------------------------------------------- Year Year Year 3/04/96* Year Ended Ended Ended Ended to 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.35 $13.66 $13.71 $13.37 $12.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.43) (0.27) (0.12) (0.11) (0.01) Net realized and unrealized gain/(loss) on investments and foreign currency 5.18 4.96 0.07 0.45 0.88 ------------------------------------------------ Total from investment operations 4.75 4.69 (0.05) 0.34 0.87 ------------------------------------------------ Distributions Distributions from realized capital gains (4.67) - - - - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $18.43 $18.35 $13.66 $13.71 $13.37 - -------------------------------------------------------------------------------- Total Return 22.16% 34.33% (0.36%) 2.54% 6.96%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $11,665 $7,417 $7,073 $7,369 $5,068 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.62% 2.55% 2.55% 2.55% 2.55%# - -------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (1.87%) (1.53%) (0.79%) (0.84%) (0.15%)# - -------------------------------------------------------------------------------- Portfolio turnover rate 537% 202% 54% 75% 67%# - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.85% 2.89% 2.88% 2.98% 3.27%# - --------------------------------------------------------------------------------
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International Small Cap Fund -------------------------------------------------- Class C -------------------------------------------------- Year Year Year 3/04/96* Year Ended Ended Ended Ended to 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.37 $13.66 $13.71 $13.37 $12.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.43) (0.31) (0.12) (0.11) (0.01) Net realized and unrealized gain/(loss) on investments and foreign currency 5.23 5.02 0.07 0.45 0.88 -------------------------------------------------- Total from investment operations 4.80 4.71 (0.05) 0.34 0.87 -------------------------------------------------- Distributions Distributions from realized capital gains (4.67) - - - - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $18.50 $18.37 $13.66 $13.71 $13.37 - -------------------------------------------------------------------------------- Total Return 22.43% 34.48% (0.36%) 2.54% 6.96%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $9,893 $5,972 $6,195 $7,025 $5,517 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.62% 2.55% 2.55% 2.55% 2.55%# - -------------------------------------------------------------------------------- Ratio of net investment income/(loss) to average net assets (1.84%) (1.53%) (0.78%) (0.84%) (0.15%)# - -------------------------------------------------------------------------------- Portfolio turnover rate 537% 202% 54% 75% 67%# - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.86% 2.89% 2.88% 2.96% 3.25%# - --------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 37 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Balanced Fund ------------------------------------------------------ Class A ------------------------------------------------------ Year Year Year Ended Year Ended Ended Ended Year Ended 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96** - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.56 $11.48 $12.58 $12.33 $12.02 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.14 0.24 0.25 0.34 0.39 Net realized and unrealized gain/(loss) on investments and foreign currency 0.32 (0.09) 1.04 1.52 1.07 ------------------------------------------------------ Total from investment operations 0.46 0.15 1.29 1.86 1.46 ------------------------------------------------------ Distributions Dividends from net investment income (0.28) (0.23) (0.32) (0.45) (0.40) Distributions from realized capital gains (1.31) (0.84) (2.07) (1.16) (0.75) ------------------------------------------------------ Total distributions (1.59) (1.07) (2.39) (1.61) (1.15) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.43 $10.56 $11.48 $12.58 $12.33 - --------------------------------------------------------------------------------- Total Return 5.67% 1.20% 12.42% 17.01% 13.10% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $7,910 $5,936 $14,415 $12,294 $10,873 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.50% 1.39% 1.39% 1.34% 1.34% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 1.54% 2.18% 2.11% 2.74% 3.32% - --------------------------------------------------------------------------------- Portfolio turnover rate 217% 198% 185% 211% 253% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.76% 1.60% 1.53% 1.59% 1.55% - ---------------------------------------------------------------------------------
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Balanced Fund -------------------------------------------------------- Class B -------------------------------------------------------- Year Year Ended Year Ended Ended Year Ended Year Ended 10/31/00** 10/31/99** 10/31/98 10/31/97** 10/31/96** - ----------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.49 $11.40 $12.49 $12.26 $11.98 - ----------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.08 0.18 0.18 0.25 0.31 Net realized and unrealized gain/(loss) on investments and foreign currency 0.34 (0.10) 1.04 1.53 1.07 -------------------------------------------------------- Total from investment operations 0.42 0.08 1.22 1.78 1.38 -------------------------------------------------------- Distributions Dividends from net investment income (0.22) (0.15) (0.24) (0.39) (0.35) Distributions from realized capital gains (1.31) (0.84) (2.07) (1.16) (0.75) -------------------------------------------------------- Total distributions (1.53) (0.99) (2.31) (1.55) (1.10) - ----------------------------------------------------------------------------------- Net Asset Value, End of Period $9.38 $10.49 $11.40 $12.49 $12.26 - ----------------------------------------------------------------------------------- Total Return 5.17% 0.57% 11.71% 16.27% 12.35% - ----------------------------------------------------------------------------------- Ratios/Supplemental Data - ----------------------------------------------------------------------------------- Net assets, end of period (000's) $15,566 $13,958 $18,929 $17,140 $16,219 - ----------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.15% 2.04% 2.04% 1.99% 1.99% - ----------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 0.87% 1.60% 1.46% 2.09% 2.67% - ----------------------------------------------------------------------------------- Portfolio turnover rate 217% 198% 185% 211% 253% - ----------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.41% 2.25% 2.18% 2.23% 2.20% - -----------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 38 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Balanced Fund ---------------------------------------------------------------- Class C Class I ---------------------------------------------------- ---------- Year Year Year 7/10/00* Year Ended Year Ended Ended Ended Ended to 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96 10/31/00** - ------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.63 $11.54 $12.62 $12.35 $12.02 $ 9.34 - ------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.08 0.17 0.18 0.25 0.32 0.14 Net realized and unrealized gain/(loss) on investments and foreign currency 0.32 (0.09) 1.05 1.54 1.07 (0.04) ---------------------------------------------------------------- Total from investment operations 0.40 0.08 1.23 1.79 1.39 0.10 ---------------------------------------------------------------- Distributions Dividends from net investment income (0.22) (0.15) (0.24) (0.36) (0.31) - Distributions from realized capital gains (1.31) (0.84) (2.07) (1.16) (0.75) - ---------------------------------------------------------------- Total distributions (1.53) (0.99) (2.31) (1.52) (1.06) - - ------------------------------------------------------------------------------------------- Net Asset Value, End of Period $9.50 $10.63 $11.54 $12.62 $12.35 $9.45 - ------------------------------------------------------------------------------------------- Total Return 4.86% 0.58% 11.68% 16.21% 12.41% 1.07%+ - ------------------------------------------------------------------------------------------- Ratios/Supplemental Data - ------------------------------------------------------------------------------------------- Net assets, end of period (000's) $37,282 $53,669 $65,049 $68,261 $72,821 $5,923 - ------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.15% 2.04% 2.04% 1.99% 1.99% 1.41%# - ------------------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 0.88% 1.55% 1.47% 2.09% 2.67% 1.47%# - ------------------------------------------------------------------------------------------- Portfolio turnover rate 217% 198% 185% 211% 253% 217%+ - ------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.43% 2.25% 2.18% 2.20% 2.20% 1.54%# - -------------------------------------------------------------------------------------------
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Core Bond Fund (formerly Investment Quality Bond Fund) ---------------------------------------------------- Class A ---------------------------------------------------- Year Year Year Year Ended Year Ended Ended Ended Ended 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.85 $10.63 $10.52 $10.34 $10.56 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.62 0.66 0.68 0.67 0.66 Net realized and unrealized gain/(loss) on investments and foreign currency (0.21) (0.77) 0.10 0.18 (0.20) ---------------------------------------------------- Total from investment operations 0.41 (0.11) 0.78 0.85 0.46 ---------------------------------------------------- Distributions Dividends from net investment income (0.66) (0.67) (0.67) (0.67) (0.68) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.60 $9.85 $10.63 $10.52 $10.34 - --------------------------------------------------------------------------------- Total Return 4.35% (1.08%) 7.63% 8.57% 4.52% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $3,858 $3,507 $6,730 $7,110 $9,056 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.29% 1.25% 1.25% 1.25% 1.25% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 6.45% 4.77% 6.45% 6.54% 6.37% - --------------------------------------------------------------------------------- Portfolio turnover rate 94% 43% 48% 65% 56% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.78% 1.70% 1.54% 1.62% 1.55% - ---------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 39 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Core Bond Fund (formerly Investment Quality Bond Fund) ------------------------------------------------------ Class B ------------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96** - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.85 $10.62 $10.52 $10.33 $10.55 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.58 0.59 0.61 0.60 0.60 Net realized and unrealized gain/(loss) on investments and foreign currency (0.24) (0.75) 0.10 0.20 (0.20) ------------------------------------------------------ Total from investment operations 0.34 (0.16) 0.71 0.80 0.40 ------------------------------------------------------ Distributions Dividends from net investment income (0.60) (0.61) (0.61) (0.61) (0.62) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.59 $9.85 $10.62 $10.52 $10.33 - --------------------------------------------------------------------------------- Total Return 3.70% (1.56%) 6.93% 8.05% 3.92% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $4,937 $4,295 $4,845 $4,613 $4,678 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.95% 1.90% 1.90% 1.90% 1.90% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.95% 5.71% 5.81% 5.89% 5.72% - --------------------------------------------------------------------------------- Portfolio turnover rate 94% 43% 48% 65% 56% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.45% 2.39% 2.20% 2.33% 2.27% - ---------------------------------------------------------------------------------
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Core Bond Fund (formerly Investment Quality Bond Fund) ------------------------------------------------------------------------------ Class C Class I Class II ------------------------------------------------------ ---------- ---------- Year Year Year Year Year 7/10/00* 7/10/00* Ended Ended Ended Ended Ended to to 10/31/00** 10/31/99** 10/31/98 10/31/97 10/31/96** 10/31/00** 10/31/00** - --------------------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.85 $10.62 $10.52 $10.33 $10.55 $9.65 $9.64 - --------------------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.57 0.59 0.61 0.60 0.60 0.19 0.19 Net realized and unrealized gain/(loss) on investments and foreign currency (0.23) (0.75) 0.10 0.20 (0.20) (0.02) (0.03) ------------------------------------------------------------------------------ Total from investment operations 0.34 (0.16) 0.71 0.80 0.40 0.17 0.16 ------------------------------------------------------------------------------ Distributions Dividends from net investment income (0.60) (0.61) (0.61) (0.61) (0.62) (0.20) (0.20) - --------------------------------------------------------------------------------------------------------- Net Asset Value, End of Period $9.59 $9.85 $10.62 $10.52 $10.33 $9.62 $9.60 - --------------------------------------------------------------------------------------------------------- Total Return 3.70% (1.56%) 6.93% 8.05% 3.92% 1.85%+ 1.81%+ - --------------------------------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------------------------------- Net assets, end of period (000's) $2,778 $4,593 $5,532 $6,109 $7,543 $19,971 $317,842 - --------------------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.95% 1.90% 1.90% 1.90% 1.90% 1.16%# 0.95%# - --------------------------------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.84% 5.70% 5.81% 5.89% 5.72% 6.18%# 6.39%# - --------------------------------------------------------------------------------------------------------- Portfolio turnover rate 94% 43% 48% 65% 56% 94%+ 94%+ - --------------------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.49% 2.38% 2.20% 2.29% 2.22% 1.16%# 0.96%# - ---------------------------------------------------------------------------------------------------------
* Commencement of Operations ** Net investment income per share has been calculated using the average share method + Not annualized # Annualized The accompanying notes are an integral part of the financial statements. 40 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
High Yield Bond Fund/1/ ------------------------------------------------------ Class A Class B Class C -------------------- -------------------- ---------- Year Year Year Year 8/21/00* Ended Ended Ended Ended to 10/31/00** 10/31/99 10/31/00** 10/31/99 10/31/00** - ---------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.43 $10.00 $9.43 $10.00 $9.00 - ---------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.88 0.81 0.82 0.74 0.20 Net realized and unrealized gain/(loss) on Investments and foreign currency (0.87) (0.57) (0.88) (0.57) (0.49) ------------------------------------------------------ Total from investment operations 0.01 0.24 (0.06) 0.17 (0.29) ------------------------------------------------------ Distributions Dividends from net investment income (0.88) (0.81) (0.82) (0.74) (0.16) - ---------------------------------------------------------------------------------- Net Asset Value, End of Period $8.56 $9.43 $8.55 $9.43 $8.55 - ---------------------------------------------------------------------------------- Total Return 0.04% 2.28% (0.83%) 1.53% (3.29%)+ - ---------------------------------------------------------------------------------- Ratios/Supplemental Data - ---------------------------------------------------------------------------------- Net assets, end of period (000's) $286 $34 $1,594 $652 $545 - ---------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.38% 1.25% 2.10% 2.00% 2.07%# - ---------------------------------------------------------------------------------- Ratio of net investment income to average net assets 10.13% 5.69% 9.41% 7.30% 9.10%# - ---------------------------------------------------------------------------------- Portfolio turnover rate 57% 72% 57% 72% 57% - ---------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.81% 2.01% 2.52% 2.37% 2.07%# - ----------------------------------------------------------------------------------
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High Yield Bond Fund/1/ ------------------------------------------ Class I Class II -------------------- -------------------- Year Year Year Ended Ended Year Ended Ended 10/31/00** 10/31/99 10/31/00** 10/31/99 - ------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.43 $10.00 $9.43 $10.00 - ------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.93 0.83 0.95 0.86 Net realized and unrealized gain/(loss) on Investments and foreign currency (0.90) (0.57) (0.91) (0.57) ----------------------------------------- Total from investment operations 0.03 0.26 0.04 0.29 ----------------------------------------- Distributions Dividends from net investment income (0.90) (0.83) (0.92) (0.86) - ------------------------------------------------------------------------------- Net Asset Value, End of Period $8.56 $9.43 $8.55 $9.43 - ------------------------------------------------------------------------------- Total Return 0.04% 2.44% 0.30% 2.74% - ------------------------------------------------------------------------------- Ratios/Supplemental Data - ------------------------------------------------------------------------------- Net assets, end of period (000's) $14 $14 $62,702 $62,506 - ------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.22% 1.13% 0.96% 0.88% - ------------------------------------------------------------------------------- Ratio of net investment income to average net assets 10.14% 5.57% 10.41% 8.84% - ------------------------------------------------------------------------------- Portfolio turnover rate 57% 72% 57% 72% - ------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.79% 2.05% 1.56% 1.35% - -------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 High Yield Bond Fund, which was reorganized into North American High Yield Bond Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average month-end share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 41 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Municipal Bond Fund (formerly National Municipal Bond) ------------------------------------------------ Class A ------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.48 $10.22 $10.09 $9.73 $9.62 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.45 0.45 0.47 0.48 0.48 Net realized and unrealized gain/(loss) on investments and foreign currency 0.18 (0.74) 0.13 0.36 0.11 ---------------------------------------------- Total from investment operations 0.63 (0.29) 0.60 0.84 0.59 ---------------------------------------------- Distributions Dividends from net investment income (0.46) (0.45) (0.47) (0.48) (0.48) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.65 $9.48 $10.22 $10.09 $9.73 - --------------------------------------------------------------------------------- Total Return 6.80% (2.95%) 6.04% 8.85% 6.31% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $7,774 $4,435 $5,820 $6,347 $7,710 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.01% 1.00% 1.00% 0.99% 0.99% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 4.74% 4.52% 4.60% 4.87% 4.99% - --------------------------------------------------------------------------------- Portfolio turnover rate 48% 46% 43% 29% 49% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.61% 1.41% 1.23% 1.23% 1.25% - ---------------------------------------------------------------------------------
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Municipal Bond Fund (formerly National Municipal Bond) ------------------------------------------------ Class B ------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.48 $10.22 $10.09 $9.73 $9.62 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.37 0.37 0.38 0.40 0.40 Net realized and unrealized gain/(loss) on investments and foreign currency 0.18 (0.74) 0.13 0.36 0.11 ---------------------------------------------- Total from investment operations 0.55 (0.37) 0.51 0.76 0.51 ---------------------------------------------- Distributions Dividends from net investment income (0.38) (0.37) (0.38) (0.40) (0.40) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.65 $9.48 $10.22 $10.09 $9.73 - --------------------------------------------------------------------------------- Total Return 5.92% (3.77%) 5.15% 7.94% 5.41% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $6,416 $4,197 $5,273 $6,532 $6,130 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.88% 1.85% 1.85% 1.84% 1.84% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 3.89% 3.67% 3.75% 4.02% 4.14% - --------------------------------------------------------------------------------- Portfolio turnover rate 48% 46% 43% 29% 49% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.47% 2.26% 2.08% 2.15% 2.11% - ---------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 42 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Municipal Bond Fund (formerly National Municipal Bond) ------------------------------------------------ Class C ------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.48 $10.22 $10.09 $9.73 $9.62 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.38 0.37 0.38 0.40 0.40 Net realized and unrealized gain/(loss) on investments and foreign currency 0.17 (0.74) 0.13 0.36 0.11 ---------------------------------------------- Total from investment operations 0.55 (0.37) 0.51 0.76 0.51 ---------------------------------------------- Distributions Dividends from net investment income (0.38) (0.37) (0.38) (0.40) (0.40) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.65 $9.48 $10.22 $10.09 $9.73 - --------------------------------------------------------------------------------- Total Return 5.93% (3.77%) 5.15% 7.94% 5.41% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $2,297 $3,931 $5,147 $5,305 $5,693 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.87% 1.85% 1.85% 1.84% 1.84% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 3.97% 3.67% 3.75% 4.02% 4.14% - --------------------------------------------------------------------------------- Portfolio turnover rate 48% 46% 43% 29% 49% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.53% 2.26% 2.08% 2.15% 2.25% - ---------------------------------------------------------------------------------
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Strategic Income Fund ------------------------------------------------ Class A ------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.40 $8.99 $9.76 $9.80 $9.07 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.72 0.72 0.67 0.70 0.80 Net realized and unrealized gain/(loss) on investments and foreign currency (0.38) (0.53) (0.63) 0.28 0.72 ------------------------------------------------ Total from investment operations 0.34 0.19 0.04 0.98 1.52 ------------------------------------------------ Distributions Dividends from net investment income (0.75) (0.73) (0.67) (0.84) (0.79) Distributions from realized capital gains - (0.05) (0.14) (0.18) - ------------------------------------------------ Total distributions (0.75) (0.78) (0.81) (1.02) (0.79) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.99 $8.40 $8.99 $9.76 $9.80 - --------------------------------------------------------------------------------- Total Return 4.09% 2.10% 0.22% 10.57% 17.35% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $6,439 $8,997 $15,296 $15,924 $13,382 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.55% 1.50% 1.50% 1.50% 1.50% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 8.70% 8.21% 7.02% 7.25% 8.28% - --------------------------------------------------------------------------------- Portfolio turnover rate 46% 119% 162% 193% 68% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.87% 1.67% 1.56% 1.61% 1.65% - ---------------------------------------------------------------------------------
The accompanying notes are an integral part of the financial statements. 43 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Strategic Income Fund ------------------------------------------------ Class B ------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.41 $8.99 $9.76 $9.80 $9.07 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.67 0.66 0.61 0.64 0.73 Net realized and unrealized gain/(loss) on investments and foreign currency (0.39) (0.52) (0.63) 0.28 0.73 ------------------------------------------------ Total from investment operations 0.28 0.14 (0.02) 0.92 1.46 ------------------------------------------------ Distributions Dividends from net investment income (0.70) (0.67) (0.61) (0.78) (0.73) Distributions from realized capital gains - (0.05) (0.14) (0.18) - ------------------------------------------------ Total distributions (0.70) (0.72) (0.75) (0.96) (0.73) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.99 $8.41 $8.99 $9.76 $9.80 - --------------------------------------------------------------------------------- Total Return 3.33% 1.56% (0.43%) 9.86% 16.59% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $15,131 $21,340 $29,210 $34,590 $30,890 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.20% 2.15% 2.15% 2.15% 2.15% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 8.00% 7.58% 6.39% 6.60% 7.63% - --------------------------------------------------------------------------------- Portfolio turnover rate 46% 119% 162% 193% 68% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.52% 2.32 2.21% 2.23% 2.27% - ---------------------------------------------------------------------------------
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Strategic Income Fund ---------------------------------------------------------- Class C Class I ------------------------------------------------ -------- Year Year Year Year Year 7/10/00* Ended Ended Ended Ended Ended to 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 10/31/00 - -------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.41 $8.99 $9.76 $9.80 $9.07 $8.22 - -------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.67 0.66 0.61 0.64 0.73 0.20 Net realized and unrealized gain/(loss) on investments and foreign currency (0.39) (0.52) (0.63) 0.28 0.73 (0.20) -------------------------------------------------------- Total from investment operations 0.28 0.14 (0.02) 0.92 1.46 - -------------------------------------------------------- Distributions Dividends from net investment income (0.70) (0.67) (0.61) (0.78) (0.73) (0.22) Distributions from realized capital gains - (0.05) (0.14) (0.18) - - -------------------------------------------------------- Total distributions (0.70) (0.72) (0.75) (0.96) (0.73) (0.22) - -------------------------------------------------------------------------------------- Net Asset Value, End of Period $7.99 $8.41 $8.99 $9.76 $9.80 $8.00 - -------------------------------------------------------------------------------------- Total Return 3.32% 1.56% (0.43%) 9.86% 16.59% (0.10%)+ - -------------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------------- Net assets, end of period (000's) $13,056 $20,749 $33,537 $32,683 $22,783 $2,636 - -------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 2.20% 2.15% 2.15% 2.15% 2.15% 1.45%# - -------------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 8.04% 7.57% 6.37% 6.60% 7.63% 7.87%# - -------------------------------------------------------------------------------------- Portfolio turnover rate 46% 119% 162% 193% 68% 46%+ - -------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.52% 2.32% 2.21% 2.24% 2.28% 1.71%# - --------------------------------------------------------------------------------------
* Commencement of Operations # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 44 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
U.S. Government Securities Fund -------------------------------------------------- Class A -------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.55 $10.08 $9.94 $9.80 $9.98 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.55 0.53 0.56 0.59 0.56 Net realized and unrealized gain/(loss) on investments and foreign currency (0.02) (0.48) 0.16 0.13 (0.12) -------------------------------------------------- Total from investment operations 0.53 0.05 0.72 0.72 0.44 -------------------------------------------------- Distributions Dividends from net investment income (0.58) (0.58) (0.58) (0.58) (0.56) Distributions in excess of net investment income - - - - (0.06) -------------------------------------------------- Total distributions (0.58) (0.58) (0.58) (0.58) (0.62) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $9.50 $9.55 $10.08 $9.94 $9.80 - -------------------------------------------------------------------------------- Total Return 5.76% 0.48% 7.41% 7.56% 4.64% - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $29,468 $35,495 $49,624 $53,235 $72,774 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.25% 1.25% 1.25% 1.25% 1.25% - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.90% 5.64% 5.65% 6.20% 5.71% - -------------------------------------------------------------------------------- Portfolio turnover rate 193% 63% 116% 364% 477% - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.62% 1.46% 1.40% 1.42% 1.41% - --------------------------------------------------------------------------------
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U.S. Government Securities Fund -------------------------------------------------- Class B -------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.56 $10.07 $9.94 $9.80 $9.98 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.49 0.47 0.49 0.54 0.50 Net realized and unrealized gain/(loss) on investments and foreign currency (0.04) (0.47) 0.15 0.11 (0.12) -------------------------------------------------- Total from investment operations 0.45 0.00 0.64 0.65 0.38 -------------------------------------------------- Distributions Dividends from net investment income (0.51) (0.51) (0.51) (0.51) (0.50) Distributions in excess of net investment income - - - - (0.06) -------------------------------------------------- Total distributions (0.51) (0.51) (0.51) (0.51) (0.56) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $9.50 $9.56 $10.07 $9.94 $9.80 - -------------------------------------------------------------------------------- Total Return 4.91% 0.01% 6.60% 6.84% 3.97% - -------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------- Net assets, end of period (000's) $8,326 $12,072 $17,850 $16,659 $19,444 - -------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.90% 1.90% 1.90% 1.90% 1.90% - -------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.27% 5.00% 4.99% 5.55% 5.06% - -------------------------------------------------------------------------------- Portfolio turnover rate 193% 63% 116% 364% 477% - -------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.27% 2.11% 2.05% 2.09% 2.06% - --------------------------------------------------------------------------------
** Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 45 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
U.S. Government Securities Fund ---------------------------------------------------- Class C ---------------------------------------------------- Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00** 10/31/99 10/31/98 10/31/97 10/31/96** - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.56 $10.07 $9.94 $9.80 $9.98 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.49 0.47 0.49 0.54 0.50 Net realized and unrealized gain/(loss) on investments and foreign currency (0.04) (0.47) 0.15 0.11 (0.12) ---------------------------------------------------- Total from investment operations 0.45 0.00 0.64 0.65 0.38 ---------------------------------------------------- Distributions Dividends from net investment income (0.51) (0.51) (0.51) (0.51) (0.50) Distributions in excess of net investment income - - - - (0.06) ---------------------------------------------------- Total distributions (0.51) (0.51) (0.51) (0.51) (0.56) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.50 $9.56 $10.07 $9.94 $9.80 - --------------------------------------------------------------------------------- Total Return 4.91% 0.01% 6.60% 6.84% 3.97% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $6,846 $10,817 $12,708 $14,716 $20,009 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 1.90% 1.90% 1.90% 1.90% 1.90% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.27% 5.00% 5.00% 5.55% 5.06% - --------------------------------------------------------------------------------- Portfolio turnover rate 193% 63% 116% 364% 477% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 2.28% 2.11% 2.05% 2.09% 2.06% - ---------------------------------------------------------------------------------
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Money Market Fund ------------------------------------------------ Class A ------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.05 0.04 0.05 0.05 0.05 Distributions Dividends from net investment income (0.05) (0.04) (0.05) (0.05) (0.05) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Total Return 5.57% 4.56% 5.18% 5.13% 5.16% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $25,610 $6,030 $10,295 $11,057 $8,087 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.69% 0.50% 0.50% 0.50% 0.50% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.72% 4.46% 5.06% 5.02% 5.02% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 0.94% 0.95% 0.92% 0.96% 0.95% - ---------------------------------------------------------------------------------
** Net investment income per share has been calculated using the average month- end share method The accompanying notes are an integral part of the financial statements. 46 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Money Market Fund ------------------------------------------------ Class B ------------------------------------------------ Year Year Year Year Year Ended Ended Ended Ended Ended 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.05 0.04 0.05 0.05 0.05 Distributions Dividends from net investment income (0.05) (0.04) (0.05) (0.05) (0.05) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Total Return 5.57% 4.56% 5.18% 5.13% 5.16% - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $8,096 $4,551 $5,919 $3,332 $3,062 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.67% 0.50% 0.50% 0.50% 0.50% - --------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.54% 4.47% 5.02% 5.02% 5.02% - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 0.93% 0.99% 0.98% 1.05% 1.18% - ---------------------------------------------------------------------------------
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Money Market Fund ---------------------------------------------------------- Class C Class I ------------------------------------------------ -------- Year Year Year Year Year 7/10/00* Ended Ended Ended Ended Ended to 10/31/00 10/31/99 10/31/98 10/31/97 10/31/96 10/31/00 - ------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 - ------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.05 0.04 0.05 0.05 0.05 0.02 Distributions Dividends from net investment income (0.05) (0.04) (0.05) (0.05) (0.05) (0.02) - ------------------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 - ------------------------------------------------------------------------------------- Total Return 5.57% 4.56% 5.18% 5.13% 5.16% 1.84%+ - ------------------------------------------------------------------------------------- Ratios/Supplemental Data - ------------------------------------------------------------------------------------- Net assets, end of period (000's) $7,195 $8,644 $8,237 $7,539 $9,840 $6,125 - ------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.67% 0.50% 0.50% 0.50% 0.50% 0.77%# - ------------------------------------------------------------------------------------- Ratio of net investment income (loss) to average net assets 5.37% 4.48% 5.05% 5.01% 5.02% 5.88%# - ------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by adviser 1.00% 1.01% 0.94% 1.00% 0.98% 0.80%# - -------------------------------------------------------------------------------------
* Commencement of Operations + Non-annualized # Annualized The accompanying notes are an integral part of the financial statements. 47 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Municipal Money Market Fund/1/ ------------------------------------------------ Class A Class B Class C ------------------ ------------------ -------- Year Year Year Year 8/10/00* Ended Ended Ended Ended to 10/31/00 10/31/99 10/31/00 10/31/99 10/31/00 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.03 0.02 0.03 0.01 0.01 Distributions Dividends from net investment income (0.03) (0.02) (0.03) (0.01) (0.01) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Total Return 3.06% 2.18% 2.48% 1.42% 0.71%+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data - --------------------------------------------------------------------------------- Net assets, end of period (000's) $4,452 $3,651 $2,777 $2,841 $108 - --------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.97% 1.05% 1.54% 1.80% 0.75%# - --------------------------------------------------------------------------------- Ratio of net investment income to average net assets 3.03% 2.18% 2.44% 1.42% 2.78%# - --------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 1.44% 1.89% 2.00% 2.69% 1.16%# - ---------------------------------------------------------------------------------
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Aggressive Growth LifeStyle Fund/2/ ----------------------------------------------------------------------------- Class A Class B Class C Class I -------------------- -------------------- ---------- -------------------- Year Year Year Year 8/10/00* Year Ended Ended Ended Ended to Year Ended Ended 10/31/00** 10/31/99 10/31/00** 10/31/99 10/31/00** 10/31/00** 10/31/99 - -------------------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.92 $10.00 $11.90 $10.00 $13.03 $11.91 $10.00 - -------------------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 1.39 0.07 1.46 0.06 0.86 1.59 0.07 Net realized and unrealized gain/(loss) on investments 0.53 1.91 0.48 1.89 (1.09) 0.34 1.90 ----------------------------------------------------------------------------- Total from investment operations 1.92 1.98 1.94 1.95 (0.23) 1.93 1.97 Distributions Dividends from net investment income (0.98) (0.06) (0.96) (0.05) - (0.96) (0.06) Distributions from realized capital gains (0.15) - (0.15) - - (0.15) ----------------------------------------------------------------------------- Total distributions (1.13) (0.06) (1.11) (0.05) - (1.11) (0.06) - -------------------------------------------------------------------------------------------------------- Net Asset Value, End of Period $12.71 $11.92 $12.73 $11.90 $12.80 $12.73 $11.91 - -------------------------------------------------------------------------------------------------------- Total Return 16.27% 19.65% 16.30% 19.52% (1.77%)+ 16.22% 19.71% - -------------------------------------------------------------------------------------------------------- Ratios/Supplemental Data - -------------------------------------------------------------------------------------------------------- Net assets, end of period (000's) $4,064 $1,929 $13,450 $4,915 $184 $5,004 $1,547 - -------------------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.12% 0.10% 0.24% 0.10% 0.73%# 0.15% 0.10% - -------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets 10.81% 0.63% 11.51% 0.66% 39.30%# 12.62% 0.62% - -------------------------------------------------------------------------------------------------------- Portfolio turnover rate 53% 9% 53% 9% 53%# 53% 9% - -------------------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 0.14% 0.10% 0.41% 0.10% 0.89%# 0.15% 0.10% - --------------------------------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Municipal Money Market Fund, which was reorganized into North American Municipal Money Market Fund on that date. /2/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Aggressive Growth LifeStyle Fund, which was reorganized into North American Aggressive Growth LifeStyle Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average month-end share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 48 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Moderate Growth LifeStyle Fund/1/ ---------------------------------------------------------------------------- Class A Class B Class C Class I -------------------- -------------------- ---------- -------------------- Year Year Year Year 7/12/00* Year Ended Ended Ended Ended to Year Ended Ended 10/31/00** 10/31/99 10/31/00** 10/31/99 10/31/00** 10/31/00** 10/31/99 - ------------------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.40 $10.00 $11.42 $10.00 $12.77 $11.39 $10.00 - ------------------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.99 0.14 1.02 0.12 0.73 1.16 0.15 Net realized and unrealized gain/(loss) on investments 0.50 1.39 0.47 1.41 (1.03) 0.32 1.38 ---------------------------------------------------------------------------- Total from investment operations 1.49 1.53 1.49 1.53 (0.30) 1.48 1.53 ---------------------------------------------------------------------------- Distributions Dividends from net investment income (0.73) (0.13) (0.74) (0.11) (0.36) (0.72) (0.14) Distributions from realized capital gains (0.09) - (0.09) - (0.09) ---------------------------------------------------------------------------- Total distributions (0.82) (0.13) (0.83) (0.11) (0.36) (0.81) (0.14) - ------------------------------------------------------------------------------------------------------- Net Asset Value, End of Period $12.07 $11.40 $12.08 $11.42 $12.11 $12.06 $11.39 - ------------------------------------------------------------------------------------------------------- Total Return 13.27% 15.20% 13.22% 15.26% (2.30%) 13.10% 15.35% - ------------------------------------------------------------------------------------------------------- Ratios/Supplemental Data - ------------------------------------------------------------------------------------------------------- Net assets, end of period (000's) $3,396 $1,918 $11,843 $5,553 $183 $5,439 $1,537 - ------------------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.12% 0.10% 0.23% 0.10% 0.80%# 0.15% 0.10% - ------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets 8.27% 1.33% 8.53% 1.40% 19.82%# 9.91% 1.42% - ------------------------------------------------------------------------------------------------------- Portfolio turnover rate 47% 11% 47% 11% 47% 47% 11% - ------------------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 0.12% 0.10% 0.23% 0.10% 0.80%# 0.15% 0.10% - -------------------------------------------------------------------------------------------------------
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Conservative Growth LifeStyle Fund/1/ ---------------------------------------------------------------------------- Class A Class B Class C Class I -------------------- -------------------- ---------- -------------------- Year Year Year Year 7/20/00* Year Year Ended Ended Ended Ended to Ended Ended 10/31/00** 10/31/99 10/31/00** 10/31/99 10/31/00** 10/31/00** 10/31/99 - ------------------------------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.03 $10.00 $11.06 $10.00 $11.95 $11.03 $10.00 - ------------------------------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.87 0.21 0.81 0.18 0.74 0.91 0.21 Net realized and unrealized gain/(loss) on investments 0.39 1.02 0.45 1.05 (0.73) 0.33 1.02 ---------------------------------------------------------------------------- Total from investment operations 1.26 1.23 1.26 1.23 0.01 1.24 1.23 ---------------------------------------------------------------------------- Distributions Dividends from net investment income (0.60) (0.20) (0.59) (0.17) (0.27) (0.58) (0.20) Distributions from realized capital gains (0.10) - (0.10) - - (0.10) ---------------------------------------------------------------------------- Total distributions (0.70) (0.20) (0.69) (0.17) (0.27) (0.68) (0.20) - ------------------------------------------------------------------------------------------------------- Net Asset Value, End of Period $11.59 $11.03 $11.63 $11.06 $11.69 $11.59 $11.03 - ------------------------------------------------------------------------------------------------------- Total Return 11.61% 12.30% 11.66% 12.21% 0.06% 11.54% 12.24% - ------------------------------------------------------------------------------------------------------- Ratios/Supplemental Data - ------------------------------------------------------------------------------------------------------- Net assets, end of period (000's) $3,420 $1,790 $10,354 $5,880 $150 $4,484 $1,508 - ------------------------------------------------------------------------------------------------------- Ratio of total expenses to average net assets 0.12% 0.10% 0.23% 0.10% 0.86%# 0.15% 0.10% - ------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets 7.62% 2.01% 7.15% 2.11% 22.43%# 8.15% 2.01% - ------------------------------------------------------------------------------------------------------- Portfolio turnover rate 45% 10% 45% 10% 45% 45% 10% - ------------------------------------------------------------------------------------------------------- Expense ratio before expense reimbursement by advisor 0.12% 0.10% 0.23% 0.10% 0.86%# 0.15% 0.10% - -------------------------------------------------------------------------------------------------------
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Conservative Growth LifeStyle Fund, which was reorganized into North American Conservative Growth LifeStyle Fund on that date. * Commencement of operations ** Net investment income per share has been calculated using the average month-end share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 49 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Growth & Income Fund - --------------------------------------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 99.19% Aerospace & Defense - 1.33% Boeing Co. 2,300 $155,969 Honeywell International, Inc. 30,400 1,635,900 United Technologies Corp. 37,600 2,624,950 ------------ 4,416,819 Banks - 3.08% Bank One Corp. 38,700 1,412,550 Chase Manhattan Corp. 45,150 2,054,325 U.S. Bancorp 147,900 3,577,331 Wachovia Corp. 59,600 3,218,400 ------------ 10,262,606 Beverages - 2.67% Coca Cola Co. 78,900 4,763,588 Pepsico, Inc. 85,400 4,136,563 ------------ 8,900,151 Business Services - 2.00% Automatic Data Processing, Inc. 62,500 4,082,031 First Data Corp. 51,400 2,576,425 ------------ 6,658,456 Chemicals - 1.34% Dow Chemical Co. 50,400 1,543,500 E.I. Du Pont de Nemours & Co. 64,033 2,905,497 ------------ 4,448,997 Communications Equipment - 6.18% Avaya, Inc.* 7 94 Cisco Systems, Inc.* 228,800 12,326,600 Corning, Inc. 20,600 1,575,900 JDS Uniphase Corp.* 21,400 1,741,425 Lucent Technologies, Inc. 105,500 2,459,469 Motorola, Inc. 99,600 2,483,775 ------------ 20,587,263 Computers & Business Equipment - 1.96% International Business Machines Corp. 66,400 6,540,400 ------------ Computers & Peripherals - 3.01% Dell Computer Corp.* 90,400 2,666,800 EMC Corp. Mass.* 49,000 4,364,063 Hewlett-Packard Company 64,800 3,009,150 ------------ 10,040,013 Electric Utilities - 1.89% Exelon Corp. 33,075 1,988,634 FPL Group, Inc. 65,500 4,323,000 ------------ 6,311,634 Electrical Equipment - 0.49% Emerson Electric Co. 22,900 1,646,581 ------------ Electronic Components - 5.07% Analog Devices, Inc.* 46,800 3,042,000 Intel Corp. 189,700 8,536,500
Shares Value ------ ----- Electronic Components - continued Micron Technology, Inc.* 76,900 $2,672,275 Texas Instruments, Inc. 54,200 2,659,188 ------------ 16,909,963 Electronic Equipment - 1.04% Solectron Corp.* 78,200 3,440,800 Teradyne, Inc.* 1,300 40,625 ------------ 3,481,425 Financial Services - 6.14% Associates First Capital Corp. 52,900 1,963,912 Citigroup, Inc. 171,266 9,012,873 Federal National Mortgage Association 3,100 238,700 Goldman Sachs Group, Inc. 26,100 2,605,106 Merrill Lynch & Co., Inc. 90,700 6,349,000 Morgan Stanley Dean Witter & Co. 3,800 305,188 ------------ 20,474,779 Forest Products - 0.06% Weyerhaeuser Co. 4,000 187,750 ------------ Health Care Equipment - 1.46% Baxter International, Inc. 59,100 4,857,281 ------------ Health Care Providers & Services - 1.74% Cardinal Health, Inc. 34,800 3,297,300 HCA Healthcare Corp. 62,600 2,500,087 ------------ 5,797,387 Hotels & Restaurants - 0.77% McDonald's Corp. 82,600 2,560,600 ------------ Household Products - 3.38% Gillette Company 57,700 2,012,288 Kimberly Clark Corp. 60,050 3,963,300 Procter & Gamble Co. 73,900 5,279,231 ------------ 11,254,819 Industrial Components - 0.58% Caterpillar, Inc. 32,300 1,132,519 Illinois Tool Works, Inc. 14,400 800,100 ------------ 1,932,619 Insurance - 4.71% American International Group, Inc. 74,625 7,313,250 Marsh & McLennan Companies, Inc. 64,000 8,368,000 ------------ 15,681,250 Internet Services - 2.27% America Online, Inc.* 92,000 4,639,560 Exodus Communications, Inc.* 17,100 573,919 VeriSign, Inc.* 17,955 2,370,060 ------------ 7,583,539 I T Consulting Services - 1.04% Computer Sciences Corp.* 37,900 2,387,700 Electronic Data Systems Corp. 23,100 1,084,256 ------------ 3,471,956
The accompanying notes are an integral part of the financial statements. 50 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Media - 3.97% AT & T - Liberty Media Corp.* 107,956 $2,503,230 General Motors Hughes Corp* 96,800 3,136,320 The Walt Disney Co. 53,100 1,901,644 Gannett, Inc. 57,500 3,335,000 Viacom, Inc.* 41,529 2,361,962 ------------ 129,800 13,238,156 Multi Industry - 5.99% General Electric Co. 233,300 12,787,756 Minnesota Mining & Manufacturing Co. 30,600 2,956,725 Tyco International Ltd. 74,300 4,211,881 ------------ 19,956,362 Non-Ferrous Metals - 0.90% Aluminum Company of America 104,400 2,994,975 ------------ Oil & Gas - 6.35% Amerada Hess Corp. 1,200 74,400 Chevron Corp. 41,500 3,408,187 Conoco, Inc. 65,000 1,767,187 El Paso Energy Corp. 2,900 181,794 ExxonMobil Corp. 123,784 11,039,986 Royal Dutch Petroleum Co. 65,300 3,877,187 UNOCAL Corp. 23,700 808,763 ------------ 21,157,504 Petroleum Services - 1.40% Schlumberger, Ltd. 61,300 4,666,462 ------------ Pharmaceuticals - 12.50% Abbott Laboratories 87,800 4,636,937 American Home Products Corp. 119,400 7,581,900 Bristol-Myers Squibb Co. 66,800 4,070,625 Johnson & Johnson 49,900 4,597,038 Merck & Company, Inc. 66,600 5,989,838 Pfizer, Inc. 139,650 6,031,134 Pharmacia Corp. 110,489 6,076,895 Schering Plough Corp. 52,000 2,687,750 ------------ 41,672,117 Pollution Control - 0.48% Waste Management, Inc. 79,900 1,598,000 ------------ Retail Trade - 4.25% CVS Corporation 19,200 1,016,400 Home Depot, Inc. 41,400 1,780,200 Target Corp. 160,000 4,420,000 Wal-Mart Stores, Inc. 153,100 6,946,912 ------------ 14,163,512 Software - 3.36% Microsoft Corp.* 162,600 11,199,075 ------------ Telecommunications - 7.78% AT & T Corp. 162,600 2,926,800 Nortel Networks Corp. 65,000 2,957,500 SBC Communications, Inc. 139,744 8,061,482 Sprint Corp.* 57,000 2,173,125 Verizon Communications 109,954 6,356,716
Shares Value ------ ----- Telecommunications - continued Worldcom, Inc.* 145,800 $3,462,750 ------------ 25,938,373 ------------ TOTAL COMMON STOCKS (Cost $245,021,974) $330,590,824 ------------ Principal Value --------- ----- REPURCHASE AGREEMENT - 0.81% Repurchase Agreement with Paribas dated 10/31/00 at 6.55%, to be repurchased at $2,765,065 on 11/01/00, collateralized by $2,231,000 U.S. Treasury Bond, 7.875% due 02/15/21 (valued at $2,727,487, including interest) (Cost $2,710,000) $2,710,000 $2,710,000 ------------ TOTAL INVESTMENTS (Growth & Income Fund) (Cost $247,731,974) $333,300,824 ------------ - ----------------------------------------------------------------------------- Large Cap Growth Fund - ----------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 96.27% Automotive - .22% Harley Davidson, Inc. 4,031 $194,244 ------------ Banking - 1.78% Bank of New York 9,050 520,941 Fifth Third Bancorp 10,706 550,021 Wells Fargo 9,925 459,651 ------------ 1,530,613 Biotechnology - 2.15% Amgen, Inc.* 16,636 963,848 Genzyme Corp.* 5,750 408,250 Human Genome Sciences, Inc.* 2,475 218,767 MedImmune, Inc.* 3,950 258,231 ------------ 1,849,096 Commercial Services & Supplies - .80% Devry, Inc.* 18,757 692,837 ------------ Communications Equipment - 12.91% Ciena Corp.* 21,800 2,291,725 Cisco Systems, Inc.* 80,943 4,360,804 Comverse Technology, Inc.* 6,725 751,519 General Motors Corporation* 16,500 534,600 JDS Uniphase Corporation* 21,545 1,753,224 Sycamore Networks, Inc.* 2,350 148,638 TyCom. Ltd.* 38,300 1,283,050 ------------ 11,123,560 Computers & Peripherals - 9.87% EMC Corporation* 36,465 3,247,664 Juniper Networks, Inc.* 7,225 1,408,875 Network Appliance, Inc.* 8,325 990,675 Sun Microsystems, Inc.* 25,761 2,856,251 ------------ 8,503,465
The accompanying notes are an integral part of the financial statements. 51 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Diversified - 2.67% Corning, Inc. 30,100 $2,302,650 ------------ Diversified Financial - 1.55% Citigroup, Inc. 25,332 1,333,097 ------------ Electrical Equipment - 2.87% Nortel Networks Corporation 54,350 2,472,925 ------------ Electronic Equipment - 5.48% Applied Micro Circuits Corporation* 12,600 962,325 Broadcom Corp.* 5,050 1,122,994 Jabil Circuit, Inc.* 14,075 803,155 Palm, Inc.* 4,150 222,284 PE Corp. 2,814 329,238 Sanmina Corp.* 2,975 340,080 SDL, Inc.* 2,150 557,387 Solectron Corporation* 8,725 383,900 ------------ 4,721,363 Financial Servies - 2.42% Federal National Mortgage Assoc. 16,600 1,278,200 Merrill Lynch & Co., Inc. 7,325 512,750 Schwab, Charles Corp. 8,516 299,125 ------------ 2,090,075 Food & Drug Retailing - 0.26% Walgreen Co. 4,900 223,563 ------------ Health Care Equipment & Supplies - 1.91% Baxter International, Inc. 14,675 1,206,102 Medtronic Inc. 8,075 438,573 ------------ 1,644,675 Insurance - 0.61% American International Group, Inc. 5,375 526,750 ------------ Industrial Conglomerates - 5.38% General Electric Company 45,014 2,467,330 Tyco International, Ltd. 38,293 2,170,734 ------------ 4,638,064 Media - 6.34% A T & T Corp* 37,550 675,900 Comcast Corporation* 30,800 1,255,100 Echostar Communications Corp.* 4,821 218,150 Omnicom Group 4,850 447,413 Time Warner, Inc. 22,640 1,718,602 Viacom, Inc.* 20,250 1,151,719 ------------ 5,466,884 Motor Vehicle Parts - 0.16% Danaher Corporation 2,249 141,968 ------------ Oil & Gas - 3.78% Anadarko Petroleum Corp. 3,750 240,188 Coastal Corp. 6,875 518,633 Enron Corp. 8,575 703,686 Halliburton 11,325 419,733
Shares Value ------ ----- Oil & Gas - continued Schlumberger Ltd. 15,250 $1,160,905 Smith International, Inc.* 3,000 211,500 ------------ 3,254,645 Pharmaceuticals - 8.33% Abbott Laboratories 11,500 607,344 Genentech, Inc.* 2,900 239,250 IDEC Pharmaceuticals Corp.* 1,450 284,381 Merck & Company, Inc. 26,750 2,405,828 Millennium Pharmaceuticals, Inc.* 3,025 219,502 Pfizer, Inc. 56,240 2,428,865 Pharmacia Corp. 18,050 992,750 ------------ 7,177,920 Retail Trade - 2.54% Amazon.com Inc.* 11,950 437,669 Home Depot, Inc. 22,219 955,417 Kohl's Corporation* 3,831 207,592 Wal-Mart Stores, Inc. 13,075 593,278 ------------ 2,193,956 Semiconductor Equipment & Products - 6.17% Analog Devices, Inc.* 19,875 1,291,875 GlobeSpan Semiconductor, Inc.* 2,125 163,492 Intel Corporation 39,629 1,783,305 LSI Logic Corp.* 21,025 691,197 Maxim Integrated Products, Inc.* 3,350 222,147 PMC-Sierra, Inc.* 2,500 423,750 Vitesse Semiconductor Corporation* 10,550 737,841 ------------ 5,313,607 Software - 13.51% BEA Systems Inc.* 2,825 202,694 Brocade Communications Systems* 2,175 494,541 Business Objects SA* 2,550 200,932 Check Point Software 6,750 1,069,031 I2 Technologies, Inc.* 1,300 221,000 Inktomi Corporation* 3,600 228,375 Mercury Interactive Corp.* 9,850 1,093,350 Microsoft Corp.* 25,300 1,742,538 Momentum Business Applications* 22 228 Oracle Corp.* 73,975 2,441,175 Redback Networks, Inc.* 6,375 678,539 Siebel Systems, Inc.* 13,025 1,366,811 Verisign, Inc.* 1,625 214,500 Veritas Software Corporation* 11,968 1,687,674 ------------ 11,641,388 Telecommunications - 3.87% AT&T Corp. 1,045 24,231 Corvis Corp.* 2,325 152,578 Level 3 Communications, Inc.* 3,775 180,020 Nextel Communications, Inc.* 8,875 341,133 Nokia Corporation 41,216 1,761,984
The accompanying notes are an integral part of the financial statements. 52 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Telecommunications - continued QUALCOMM* 9,900 $644,583 VoiceStream Wireless Corporation* 1,765 232,098 ------------ 3,336,627 Utilities - 0.69% Calpine Corporation* 2,450 193,397 Dynegy Inc. 4,350 201,459 The AES Corp.* 3,575 201,985 ------------ 596,841 ------------ TOTAL COMMON STOCKS (Cost $81,814,690) $82,970,813 ------------ SHORT TERM INVESTMENTS - 0.00% SSGA Money Market Fund 1,000 1,000 ------------ Principal Value --------- ----- REPURCHASE AGREEMENT - 3.73% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $3,218,574 on 11/01/00, collateralized by $3,150,000 U.S. Treasury Bonds, 6.125% due 08/15/29 (valued at $3,291,752 including interest) (Cost $3,218,000) $3,218,000 $3,218,000 ------------ TOTAL INVESTMENTS (Large Cap Growth Fund) (Cost $85,032,690) $86,189,813 ------------ - ----------------------------------------------------------------------------- Mid Cap Growth Fund - ----------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 97.48% Advertising - 0.75% Lamar Advertising Co.* 4,150 $199,200 WPP Group, Plc 6,800 381,030 ------------ 580,230 Banks - 1.17% Banknorth Group, Inc. 10,200 184,875 National Comm Bancorp 3,700 78,625 Northern Trust Corp. 7,500 640,313 ------------ 903,813 Biotechnology - 8.66% Celgene Corp.* 12,375 796,641 Cor Therapeutics, Inc.* 17,700 1,000,050 Genzyme Corp.* 6,100 433,100 Gilead Sciences, Inc.* 6,000 516,000 Human Genome Sciences, Inc.* 9,700 857,389 Medarex, Inc.* 5,100 311,738 Medimmune, Inc.* 9,100 594,913 Millennium Pharmaceuticals* 13,480 978,142 Protein Design Labs, Inc.* 8,800 1,188,688 ------------ 6,676,661
Shares Value ------ ----- Business Services - 4.04% Bisys Group, Inc.* 8,500 $400,562 CSG Systems International, Inc.* 6,450 299,522 Diamond Technology Partners, Inc.* 5,000 223,125 Paychex, Inc. 25,125 1,424,273 Robert Half International, Inc.* 25,200 768,600 ------------ 3,116,082 Communications Equipment - 7.44% Brocade Communications Systems, Inc.* 6,150 1,398,356 Cacheflow, Inc.* 3,100 334,800 Ciena Corp.* 9,500 998,688 Comverse Technology, Inc.* 7,100 793,425 Crown Castle International Corp.* 9,400 284,937 Extreme Networks, Inc.* 9,500 787,906 Oni Sys Corp.* 3,900 316,144 Redback Networks, Inc.* 6,400 681,200 Turnstone Systems, Inc.* 6,800 144,500 ------------ 5,739,956 Computers & Peripherals - 0.83% Handspring, Inc.* 3,600 260,325 Network Appliance, Inc.* 3,200 380,800 ------------ 641,125 Electronic Equipment & Instruments - 5.95% Analog Devices, Inc.* 5,700 370,500 Applied Micro Circuits Corp.* 11,600 885,950 Flextronics International, Ltd.* 11,600 440,800 Jabil Circuit, Inc.* 11,900 679,044 Molex, Inc.* 9,800 529,200 Sanmina Corp.* 4,700 537,269 SDL, Inc.* 4,400 1,140,700 ------------ 4,583,463 Energy Equipment & Services - 4.88% BJ Services Company* 7,200 377,550 Cooper Cameron Corp.* 9,450 515,025 Grant Pride, Inc.* 5,450 101,166 Nabors Industries, Inc.* 13,650 694,785 Noble Drilling Corp.* 15,650 650,453 Santa Fe International 18,000 657,000 Smith International, Inc.* 10,850 764,925 ------------ 3,760,904 Financial Services - 8.09% Bear Stearns Companies, Inc. 5,700 345,562 Capital One Financial Corp. 9,200 580,750 Countrywide Cr Inds, Inc. 7,700 288,269 A.G. Edwards, Inc. 9,400 477,050 Federated Invs, Inc. 2,500 72,812 Legg Mason, Inc. 10,100 524,569 Lehman Brothers Holdings, Inc. 6,820 439,890 Providian Financial Corp. 4,900 509,600 Sei Investments Co. 3,900 353,925 T. Rowe Price & Associates, Inc. 20,400 954,975 TCF Financial Corp. 3,000 121,313
The accompanying notes are an integral part of the financial statements. 53 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Financial Services - continued USA Ed, Inc. 11,400 $636,975 Waddell & Reed Financial, Inc. Cl. A 21,442 683,464 Waddell & Reed Financial, Inc. Cl. B 8,029 250,906 ------------ 6,240,060 Healthcare Equipment & Supplies - 3.13% Allergan, Inc. 9,750 819,609 Inhale Therapeutic Systems* 12,700 631,825 PE Corp. 8,200 959,400 ------------ 2,410,834 Hotels, Restaurants & Leisure - 3.33% Gemstar TV Guide International, Inc.* 6,750 462,797 Harley Davidson, Inc. 10,800 520,425 Harrah's Entertainment, Inc.* 31,450 900,256 MGM Mirage, Inc. 19,850 686,066 ------------ 2,569,544 Insurance - 3.97% Ambac Financial Group, Inc. 8,300 662,444 John Hancock Financial Services* 19,400 613,525 MGIC Invt Corp. 8,300 565,437 PMI Group, Inc. 5,800 428,475 Radian Group, Inc. 5,800 411,075 Sun Life Financial Services, Inc. (CAD)* 8,700 179,411 Sun Life Financial Services, Inc.* 9,800 200,900 ------------ 3,061,267 Internet Software & Services - 2.49% Exodus Communications, Inc.* 16,800 563,850 Infospace, Inc.* 16,974 341,602 Real Networks, Inc.* 3,900 80,376 Verisign, Inc.* 5,000 660,000 Vignette Corp.* 9,150 272,784 ------------ 1,918,612 IT Consulting & Services - 0.47% Proxicom, Inc.* 14,740 198,990 Sapient Corp.* 4,500 160,031 ------------ 359,021 Media - 4.04% Cablevision Systems Corp.* 7,500 558,750 Hispanic Broadcasting Corp.* 8,200 256,250 Interpublic Group Cos., Inc. 5,400 231,862 Omnicom Group 7,200 664,200 TMP Worldwide, Inc.* 9,960 693,309 USA Networks, Inc.* 21,050 426,263 WPP Group 17,000 228,162 WPP Group (ADR) 900 60,187 ------------ 3,118,983 Oil & Gas - 1.36% Anadarko Pete Co. 7,400 473,970 Apache Corp. 10,450 578,016 ------------ 1,051,986
Shares Value ------ ----- Personal Products - 0.23% Estee Lauder Companies, Inc. 3,800 $176,462 ------------ Pharmaceuticals - 6.76% Abgenix, Inc.* 10,400 820,300 Alza Corp.* 9,150 740,578 Andrx Corp.* 6,400 460,800 Forest Laboratories, Inc.* 13,750 1,821,875 ICN Pharmaceuticals, Inc. 1,600 60,900 Imclone Systems, Inc.* 7,300 399,219 King Pharmaceuticals, Inc.* 12,375 554,555 Teva Pharmaceutical Industries 6,000 354,750 ------------ 5,212,977 Retail Trade - 2.10% Best Buy Company, Inc.* 3,500 175,656 CDW Computer Centers, Inc.* 4,000 257,750 Kohls Corp.* 10,500 568,969 Radioshack Corp. 10,280 612,945 ------------ 1,615,320 Road & Rail - 0.01% Kansas City Southern Industries, Inc. 650 5,647 ------------ Semiconductor Equipment & Products - 8.11% Altera Corp.* 20,800 851,500 Conexant Systems, Inc.* 4,600 121,037 Globespan Semiconductor, Inc.* 5,750 442,391 Linear Technology Corp. 11,400 736,012 Maxim Integrated Products, Inc.* 11,500 762,594 Microchip Technology, Inc.* 10,575 334,434 PMC Sierra, Inc.* 3,150 533,925 Transwitch Corp. 16,800 970,200 Vitesse Semiconductor Corp.* 9,300 650,419 Xilinx, Inc. 11,750 851,141 ------------ 6,253,653 Software - 14.05% Aether Systems, Inc.* 4,200 338,625 Amdocs Limited* 12,350 800,434 Art Technology Group, Inc.* 8,900 558,475 BEA Systems, Inc.* 12,200 875,350 Commerce One, Inc.* 7,800 500,662 I2 Technologies, Inc.* 5,280 897,600 Inktomi Corp.* 6,000 380,625 Internap Network Services Corp.* 10,400 166,400 Intuit* 13,200 810,975 Liberate Technologies* 5,800 110,563 Macromedia, Inc.* 7,600 585,675 Mercury Interactive Corp.* 8,750 971,250 Metasolv Software, Inc.* 3,200 39,800 Micromuse, Inc.* 1,000 169,688 Nvidia Corp.* 3,400 211,278 Peregrine Systems, Inc.* 10,850 260,400 Quest Software, Inc.* 4,000 174,750 Portal Software, Inc.* 7,250 255,109 Rational Software Corp.* 13,600 811,750
The accompanying notes are an integral part of the financial statements. 54 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Software - continued Siebel Systems, Inc.* 8,800 $923,450 Software.com, Inc.* 3,720 554,280 Tibco Software, Inc.* 5,700 359,100 Vitria Technology, Inc.* 3,000 80,625 ------------ 10,836,864 Telecommunications - 5.63% ADC Telecommunications, Inc.* 14,000 299,250 Allegiance Telecom, Inc.* 7,050 221,634 Colt Telecommunications Group PLC* 3,150 411,469 Echostar Communications Corp.* 17,950 812,237 Entercom Communications Corp.* 10,350 405,591 McLeodUSA, Inc.* 34,550 665,088 Nextel Partners, Inc.* 19,300 472,850 Time Warner Telecommunications, Inc.* 10,450 623,081 Western Wireless Corp.* 6,100 289,750 XO Communications, Inc.* 4,100 137,267 ------------ 4,338,217 ------------ TOTAL COMMON STOCKS (Cost $67,714,407) $75,171,681 ------------ Principal Value --------- ----- SHORT TERM INVESTMENTS - 2.52% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $1,940,341 on 11/01/00, collateralized by $1,680,000 U.S. Treasury Bonds, 7.50% due 11/15/16 (valued at $1,992,158 Inc. Including interest) (Cost $1,940,000) $1,940,000 $1,940,000 ------------ TOTAL INVESTMENTS (Mid Cap Growth Fund) (Cost $69,654,407) $77,111,681 ------------ - ----------------------------------------------------------------------------- Mid Cap Value Fund - ----------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 94.38% Aerospace & Defense - 3.08% General Dynamics Corp. 5,800 $415,063 Raytheon Co. 9,100 291,200 ------------ 706,263 Airlines - 2.54% Continental Airlines, Inc.* 4,900 257,250 Southwest Airlines Co. 11,400 324,900 ------------ 582,150 Auto Components - 3.30% Lear Corp.* 18,000 490,500 Visteon Corp. 15,000 265,312 ------------ 755,812
Shares Value ------ ----- Banking - 4.34% Dime Bancorp. Inc. 16,500 $403,219 Golden State Bancorp. Inc. 1,000 26,125 Golden West Financial Corp. 4,000 224,250 M & T Bank Corp. 6,800 341,360 ------------ 994,954 Biotechnology - 1.24% Edwards Lifesciences Corp.* 6,900 92,719 Genzyme Corp.* 2,700 191,700 ------------ 284,419 Building Products - 1.15% Crane Company 10,100 264,494 ------------ Chemicals - 1.86% FMC Corp. 5,600 425,600 ------------ Commercial Services & Supplies - 5.88% Choice Point, Inc.* 8,900 455,569 Dun & Bradstreet Corp.* 8,200 177,325 Fiserv, Inc.* 2,500 131,094 Iron Mountain, Inc. 10,700 361,794 Waste Management, Inc. 11,100 222,000 ------------ 1,347,782 Communications Equipment - 1.55% 3Com Corporation* 15,700 278,675 American Tower Corp.* 1,900 77,781 ------------ 356,456 Computers & Peripherals - 0.45% Western Digital Corp.* 17,100 102,600 ------------ Electrical Equipment - 3.14% Energizer Holdings, Inc.* 11,100 219,225 SPX Corp.* 1,300 160,712 Thermo Electron Corp.* 11,700 339,300 ------------ 719,237 Electronic Equipment & Instruments - 0.44% Harman International Industries, Inc. 2,100 100,800 ------------ Energy Equipment & Services - 1.08% Santa Fe International Corp. 4,000 146,000 Weatherford International, Inc. 2,800 102,200 ------------ 248,200 Financial Services - 6.97% Countrywide Credit Industries, Inc. 4,000 149,750 AG Edwards, Inc. 2,200 111,650 Federated Investments, Inc.* 6,400 186,400 Franklin Resources, Inc. 2,800 119,952 Household International, Inc. 4,500 226,406 Lehman Brothers Holdings, Inc. 2,500 161,250 Moody's Corp. 10,000 263,125 Nationwide Financial Services, Inc. 7,800 379,275 ------------ 1,597,808 Food & Drug Retailing - 1.25% Kroger Company* 12,700 286,544 ------------
The accompanying notes are an integral part of the financial statements. 55 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Food Products - 2.05% Hershey Foods Corp. 5,000 $271,562 Wm Wrigley, Jr. Co. 2,500 197,969 ------------ 469,531 Health Care Equipment & Supplies - 2.37% Beckman Coulter, Inc. 2,100 147,131 Charles River Laboratories* 9,900 259,875 Sybron International Corp.* 5,500 136,125 ------------ 543,131 Health Care Providers & Services - 2.95% Health Management Assoc.* 8,400 166,425 Tenet Healthcare Corp. 9,400 369,538 Wellpoint Health Networks, Inc.* 1,200 140,325 ------------ 676,288 Hotels, Restaurants & Leisure - 0.99% Brinker International, Inc.* 5,800 227,650 ------------ Household Durables - 1.58% Lennar Corp. 11,300 363,012 ------------ Insurance - 10.45% Ace Limited 8,400 329,700 AmbacFinancial Group, Inc. 3,700 295,306 Aon Corp. 7,000 290,062 John Hancock Financial Services* 11,900 376,338 MBIA, Inc. 2,500 181,719 Metlife, Inc.* 18,900 522,112 XL Capital, Ltd. 5,200 399,750 ------------ 2,394,987 IT Consulting & Services - 2.76% Ceridian Corp.* 7,500 187,500 SunGuard Data Systems, Inc.* 8,700 444,788 ------------ 632,288 Machinery - 0.94% Danaher Corp. 3,400 214,625 ------------ Media - 5.31% AH Belo Corp. 24,400 468,175 Cablevision Systems Corp.* 3,100 230,950 Entercom Communications Corp.* 5,600 219,450 E. W. Scripps Co. 5,100 298,031 ------------ 1,216,606 Multiline Retail - 1.71% Consolidated Stores Corp.* 5,300 62,938 Costco Wholesale Corp.* 5,800 212,425 Federated Department Stores 3,600 117,225 ------------ 392,588 Oil & Gas- 4.32% Anadarko Petroleum Corp. 2,000 128,100 Apache Corp. 2,100 116,156 Coastal Corp. 2,000 150,875 EOG Resources, Inc. 4,200 165,375 Gulf CDA Resources Ltd.* 51,400 218,450 USX Marathon Group 7,800 212,062 ------------ 991,018
Shares Value ------ ----- Personal Products - 0.49% Carter Wallace, Inc. 4,100 $112,494 ------------ Pharmaceuticals - 2.13% ICN Pharmaceuticals, Inc. 4,800 182,700 Ivax Corp.* 4,300 187,050 Mylan Labs, Inc. 4,200 117,600 ------------ 487,350 Real Estate - 2.38% Boston Properties, Inc. 4,300 174,150 Indymac Bancorp, Inc. 8,300 173,262 Spieker Properties, Inc. 3,600 199,350 ------------ 546,762 Software - 3.42% Citrix Systems, Inc.* 17,900 396,038 DST Systems, Inc.* 3,700 228,012 Intuit* 2,600 159,737 ------------ 783,787 Specialty Retail - 2.27% Staples, Inc.* 8,400 119,700 Tiffany & Company 3,700 157,944 TJX Companies, Inc. 8,900 242,525 ------------ 520,169 Telecommunications - 2.42% Broadwing, Inc.* 10,300 290,975 Telephone & Data Systems, Inc. 2,500 263,750 ------------ 554,725 Transportation - Road & Rail - 0.94% GATX 5,100 214,519 ------------ Utilities - Electrical & Gas - 6.63% AES Corp.* 3,400 192,100 Dominion Res, Inc. 500 29,781 Dominion Res, Inc. 2,400 142,950 DPL, Inc. 7,200 204,300 Edison International 9,700 231,588 Exelon corp. 7,525 452,441 Kinder Morgan, Inc. 4,300 165,819 Northeast Utilities 5,000 101,875 ------------ 1,520,854 ------------ TOTAL COMMON STOCKS (Cost $18,676,386) $21,635,503 ------------ Principal Value --------- ----- REPURCHASE AGREEMENT - 5.62% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $1,289,227 on 11/01/00, collateralized by, $1,200,000 U.S. Treasury Notes 7.875% due 11/15/04 (valued at $1,328,843 including interest) (Cost $1,289,000) $1,289,000 $1,289,000 ------------ TOTAL INVESTMENTS (Mid Cap Value Fund) (Cost $19,965,386) $22,924,503 ------------
The accompanying notes are an integral part of the financial statements. 56 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Science & Technology Fund - --------------------------------------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 93.09% Communications Equipment - 14.54% Ciena Corp.* 2,900 $304,863 Cisco Systems, Inc.* 16,000 862,000 Corning, Inc. 4,000 306,000 JDS Uniphase Corp.* 4,000 325,500 Nokia Corp. 19,200 820,800 Qualcomm, Inc.* 5,600 364,612 Sycamore Networks, Inc.* 3,600 227,700 ------------ 3,211,475 Computers & Peripherals - 7.53% Dell Computer Corp.* 16,000 472,000 EMC Corp.* 6,400 570,000 Sun Microsystems, Inc.* 5,600 620,900 ------------ 1,662,900 Electrical Equipment - 3.03% Flextronics International, Ltd.* 13,600 516,800 Furukawa Electric 5,800 152,555 ------------ 669,355 Electronic Equipment & Instruments - 9.73% Applied Micro Circuits Corp.* 6,400 488,800 Sanmina Corp.* 2,700 308,644 Sci Systems, Inc.* 3,700 159,100 SDL, Inc.* 2,700 699,975 Solectron Corp.* 11,200 492,800 ------------ 2,149,319 Internet Software & Services - 8.76% America Online, Inc.* 4,800 242,064 Ariba, Inc.* 6,400 808,800 Exodus Communications, Inc.* 12,000 402,750 Real Networks, Inc.* 4,800 98,925 Verisign, Inc.* 2,900 382,800 ------------ 1,935,339 Machinery - 0.67% Cognex Corp.* 4,400 147,400 ------------ Media - 1.18% General Motors Hughes* 8,000 259,200 ------------ Semiconductor Equipment & Products - 22.01% Altera Corp.* 12,800 524,000 Analog Devices, Inc.* 9,600 624,000 Applied Materials, Inc.* 6,600 350,625 ASM Lithography Holding NV* 8,000 222,500 Intel Corp. 5,300 238,500 KLA Tencor Corp.* 9,800 331,362 LSI Logic Corp.* 17,600 578,600 Maxim Integrated Products, Inc.* 8,400 557,025 Novellus Systems, Inc.* 5,400 221,063 Texas Instruments, Inc. 12,900 632,906 Xilinx, Inc.* 8,000 579,500 ------------ 4,860,081
Shares Value ------ ----- Software - 13.73% Electronic Arts, Inc.* 12,800 $640,000 Intuit* 5,300 325,619 Microsoft Corp.* 12,800 881,600 Netiq* 2,400 206,700 Oracle Corp.* 17,600 580,800 Siebel Systems, Inc.* 1,900 199,381 Veritas Software Corp.* 1,400 197,422 ------------ 3,031,522 Telecommunications - 11.91% China Mobile HK Ltd.* 3,400 104,125 Colt Telecom Group* 12,800 408,587 Nortel Networks Corp. 10,500 477,750 Sprint Corp.* 6,500 247,813 Vodafone Group 24,000 99,854 Vodafone Group Plc 14,400 612,900 Worldcom, Inc.* 8,000 190,000 XO Communications, Inc.* 14,500 489,148 ------------ 2,630,177 TOTAL COMMON STOCKS (Cost $21,336,431) $20,556,768 ------------ Principal Value --------- ----- REPURCHASE AGREEMENT - 6.91% Repurchase Agreement with State Street Bank & Trust dated 10/31/00 at 6.42%, to be repurchased at $1,527,269 on 11/01/00, collateralized by $1,570,000 U.S. Treasury Note, 5.875% due 09/30/02 (valued at $1,566,325, including interest) (Cost $1,527,000) $1,527,000 $1,527,000 ------------ TOTAL INVESTMENTS (Science & Technology Fund) (Cost $22,863,431) $22,083,768 ------------ - ----------------------------------------------------------------------------- Small Cap Growth Fund - ----------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 89.56% Aerospace & Defense - 1.02% Aeroflex, Inc.* 6,700 $398,650 ------------ Banks - 1.24% Bank UTD Corp.* 6,500 368,469 National Commerce Bancorp* 3,550 75,438 Pacific Century Financial Corp.* 3,150 39,966 ------------ 483,873 Biotechnology - 4.50% Aclara Biosciences, Inc.* 9,975 178,303 Affymetrix, Inc.* 3,400 188,275 Ciphergen Biosystems, Inc.* 8,900 275,900 Illumina, Inc.* 9,900 321,750
The accompanying notes are an integral part of the financial statements. 57 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Biotechnology - continued Lynx Therapeutics, Inc.* 5,600 $98,000 Maxim Pharmaceuticals, Inc.* 3,600 159,750 Maxygen, Inc.* 4,075 164,019 Medarex, Inc.* 6,000 366,750 ------------ 1,752,747 Commercial Services & Supplies - 2.16% Advantage Learning Systems, Inc.* 10,800 320,625 Compucredit Corp.* 5,900 182,162 Getty Images, Inc.* 10,600 336,550 ------------ 839,337 Communications Equipment - 9.73% Adaptive Broadband Corp.* 1,900 30,519 Advanced Fibre Communications* 13,700 446,106 Antec Corp.* 8,400 102,375 Audio Codes, Ltd.* 9,300 367,931 Integrated Telecom Express* 17,300 244,362 MRV Communications, Inc.* 8,600 339,700 Polycom, Inc.* 12,450 809,250 Powerwave Technologies, Inc.* 10,500 505,312 Proxim, Inc.* 7,200 436,500 Tekelec, Inc.* 13,800 508,012 ------------ 3,790,067 Computers & Peripherals - 1.14% DSP Group, Inc.* 13,800 391,575 Interlink Electronics* 2,300 51,463 ------------ 443,038 Diversified Financial - 0.99% Americredit Corp.* 14,400 387,000 ------------ Diversified Telecommunication - 0.05% CTC Communications Group, Inc.* 1,950 18,830 ------------ Electrical Equipment - 1.72% Anaren Microwave, Inc.* 4,250 442,000 Asyst Technologies, Inc.* 10,200 153,000 Plexus Corp.* 1,204 75,927 ------------ 670,927 Electronic Equipment & Instruments - 4.65% Anadigics, Inc.* 10,200 228,225 Caliper Technologies Corp.* 2,900 163,488 Exar Corp.* 9,050 404,422 Mips Technologies, Inc.* 9,000 361,125 Sipex Corp.* 10,400 409,500 Veeco Instruments, Inc.* 2,400 158,888 Zygo Corp.* 1,751 86,674 ------------ 1,812,322 Energy Equipment & Services - 5.43% BJ Services Company* 5,900 309,381 Cooper Cameron Corp.* 5,400 294,300 Core Laboratories Ltd.* 2,400 51,750 Global Industries, Inc.* 3,500 36,750 Global Marine, Inc.* 4,450 117,925
Shares Value ------ ----- Energy Equipment & Services - continued National Oil Well, Inc.* 11,075 $323,944 Petroleum Geo Services, Inc.* 21,000 287,438 Rowan Companies, Inc.* 13,300 334,994 Smith International, Inc.* 5,100 359,550 ------------ 2,116,032 Food Products - 0.85% Hain Celestial Group, Inc.* 8,300 329,406 ------------ Health Care Equipment & Supplies - 2.87% Charles River Laboratories, Inc.* 15,100 396,375 Coherent, Inc.* 7,700 268,056 Inhale Therapeutic Systems* 5,900 293,525 Minimed, Inc.* 1,000 72,938 Molecular Devices Corp.* 1,275 87,178 ------------ 1,118,072 Health Providers & Services - 15.78% Advance Paradiam, Inc.* 16,800 821,100 Amerisource Health Corp.* 14,200 616,812 Bindley Western Industries, Inc.* 12,925 464,492 Caremark RX, Inc.* 37,600 470,000 Community Health Services, Inc.* 23,775 670,158 Foundation Health Systems* 33,500 676,281 Lifepoint Hospitals, Inc.* 9,600 372,000 Mid Atlantic Medical Services, Inc.* 23,500 399,500 Oxford Health Plans, Inc.* 23,300 786,375 Renal Care Group, Inc.* 13,300 312,550 Universal Health Services, Inc.* 6,600 553,575 ------------ 6,142,843 Hotels, Restaurants & Leisure - 1.19% American Classic Voyages Co.* 13,000 179,563 Mandalay Resort Group* 13,700 285,131 ------------ 464,694 Insurance - 1.61% Fidelity National Financial, Inc. 18,300 449,494 Mutual Risk Management Ltd. 9,700 175,812 ------------ 625,306 Internet & Catalog Retail - 0.69% Valuevision International, Inc.* 13,300 269,325 ------------ Internet Software & Services - 0.32% About.com, Inc.* 2,800 67,200 Marimba, Inc.* 1,500 8,906 Radvision Ltd.* 2,200 48,675 ------------ 124,781 I T Consulting & Services - 1.53% Acxiom Corp.* 12,640 508,760 Titan Corp.* 6,500 86,937 ------------ 595,697 Leisure Equipment & Products - 0.74% Championship Auto Racing Team* 11,500 286,063 ------------ Machinery - 1.69% APW Ltd.* 14,200 655,862 ------------
The accompanying notes are an integral part of the financial statements. 58 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Media - 0.74% Catalina Marketing Corp.* 7,350 $288,488 ------------ Oil & Gas - 1.85% Devon Energy Corp. 1,750 88,200 Precision Drilling Corp.* 2,200 62,975 Spinnaker Exploration Co.* 4,775 144,444 Stone Energy Corp.* 8,300 424,960 ------------ 720,579 Pharmaceuticals - 5.52% Alkermes, Inc.* 10,900 403,981 Cell Therapeutics, Inc.* 5,400 361,209 Intermune Pharmaceuticals, Inc.* 2,200 110,000 KV Pharmaceutical Co.* 6,300 245,306 Medicis Pharmaceutical Corp.* 7,800 574,275 Praecis Pharmaceuticals, Inc.* 9,100 230,912 Titan Pharmaceuticals, Inc.* 2,100 88,368 United Therapeutics Corp.* 2,500 133,750 ------------ 2,147,801 Semiconductor Equipment & Products - 7.90% Alpha Industries, Inc.* 15,300 610,088 C-Cube Microsystems, Inc.* 19,200 374,400 Cymer, Inc.* 7,500 187,500 Emcore Corp.* 11,700 479,700 Fairchild Semiconductor Int'l., Inc.* 4,655 98,046 Photronics, Inc.* 14,400 324,900 PRI Automation, Inc.* 4,825 109,166 Telcom Semiconductor, Inc.* 4,200 59,063 Transwitch Corp.* 6,800 392,700 Varian Semiconductor Equipment, Inc.* 5,800 133,400 Zoran Corp.* 6,100 305,763 ------------ 3,074,726 Software - 13.65% Avant Corp.* 500 8,406 Backweb Technologies, Ltd.* 17,800 159,088 Certicom Corp.* 10,000 330,000 Clarent Corp.* 6,375 198,023 Documentum, Inc.* 7,400 629,000 Great Plains Software, Inc.* 3,800 147,962 Informatica Corp.* 3,600 340,200 Iona Technologies PLC* 5,200 341,900 Manugistics Group, Inc.* 5,500 626,656 National Instruments Corp.* 1,150 53,691 Natural Microsystems Corp.* 5,600 253,050 Netiq* 4,400 378,950 Peregrine Systems, Inc.* 21,700 520,800 QRS Corp.* 800 6,750 Radiant Systems, Inc.* 19,100 352,156 Remedy Corp.* 6,400 109,600 RSA Sec, Inc.* 6,200 359,600 Seachange International. Inc.* 10,100 222,200
Shares Value ------ ----- Software - continued T HQ, Inc.* 13,500 $276,750 Unify Corp.* 500 250 ------------ 5,315,032 ------------ TOTAL COMMON STOCKS (Cost $33,581,258) $34,871,498 ------------ Principal Value --------- ----- SHORT TERM INVESTMENTS - 10.44% SSGA Money Market Fund $4,065,796 $4,065,796 ---------- ------------ TOTAL INVESTMENTS (Small Cap Growth Fund) (Cost $37,647,054) $38,937,294 ------------ - ---------------------------------------------------------- Small Cap Index Fund - ---------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 89.05% Aerospace & Defense - 0.98% Aar Corp. 200 $2,388 Aeroflex, Inc.* 195 11,603 Alliant Techsystems, Inc.* 100 8,994 Gencorp, Inc. 300 2,513 Heico Corp. 3 36 Hexcel Corp.* 330 3,609 Kaman Corp. 146 2,117 Newport News Shipbuilding, Inc. 300 14,756 Orbital Sciences Corp.* 300 2,381 Precision Castparts Corp. 400 15,100 Primex Technologies, Inc. 100 2,931 Remec, Inc.* 261 7,781 Sequa Corp.* 100 3,687 ------------ 77,896 Air Freight & Couriers - 0.36% Airborne Freight Company 400 4,050 Atlas Air, Inc.* 191 6,924 CNF Transportation, Inc. 203 5,418 EGL, Inc.* 200 5,700 Forward Air Corp.* 100 4,113 Fritz Companies, Inc.* 329 2,672 ------------ 28,877 Airlines - 0.49% Airtran Holdings, Inc.* 600 2,663 Alaska Air Group, Inc.* 200 5,188 America West Holdings Corp.* 313 3,110 Atlantic Coast Airlines Holdings* 200 7,150 Frontier Airlines, Inc.* 400 9,400 Mesa Air Group, Inc.* 300 1,763 Mesaba Holdings, Inc.* 100 1,081 Midwest Express Holdings, Inc.* 100 1,900 Skywest, Inc. 134 6,766 ------------ 39,021
The accompanying notes are an integral part of the financial statements. 59 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Auto Components - 1.07% American Axle & Mfg. Holdings, Inc.* 100 $1,244 Arvinmeritor, Inc. 506 8,476 Bandag, Inc. 100 3,569 Borg Warner Automotive, Inc. 124 4,681 Collins & Aikman Corp.* 500 2,375 Cooper Tire & Rubber Co. 391 4,277 Delco Remy Int'l.,l Inc.* 100 669 Dura Automotive Systems, Inc.* 240 2,025 Exide Corp. 100 1,006 Federal Mogul Corp. 454 1,476 Federal Signal Corp. 400 9,350 Hayes Lemmerz Int'l., Inc.* 225 2,461 IMPCO Technologies, Inc.* 13 256 Lear Corp.* 461 12,562 Mascotech, Inc. 338 5,640 Midas, Inc. 100 1,388 Modine Manufacturing Co. 144 3,798 Sauer Danfoss, Inc. 100 756 Snap-On, Inc. 337 8,615 Stoneridge, Inc.* 100 975 Superior Industries Int'l., Inc. 127 4,326 Tenneco Automotive, Inc. 98 420 Tower Automotive, Inc.* 400 4,400 ---------- 84,745 Automobiles - 0.05% Coachmen Industries, Inc. 100 837 Monaco Coach Corp.* 75 1,280 Thor Industries, Inc. 45 900 Winnebago Industries, Inc. 100 1,150 ---------- 4,167 Banks - 6.95% 1st Source Corp. 105 1,647 Alabama National Bancorp. 100 1,944 Amcore Financial, Inc. 200 3,925 American Financial Holdings, Inc. 165 2,949 Anchor Bancorp of Wisconsin, Inc. 200 3,088 Andover Bancorp, Inc. 42 1,260 Area Bancshares Corp. 100 2,088 Astoria Financial Corp. 518 19,425 Bancorpsouth, Inc. 725 9,470 Bank Granite Corp. 100 2,325 Bank United Corp. 300 17,006 Bay View Capital Corp. 208 1,690 BOK Financial Corp.* 100 1,900 Brenton Banks, Inc. 120 1,485 Brookline Bancorp, Inc. 100 1,081 BSB Bancorp, Inc. 100 1,450 BT Financial Corp. 105 2,054 Capitol Federal Financial 800 11,600 Cathay Bancorp, Inc. 100 4,931 Century South Bank, Inc. 100 1,838 Chemical Financial Corp. 131 2,800
Shares Value ------ ----- Banks - continued Chittenden Corp. 207 $5,498 Citizens Banking Corp. 361 8,596 Colonial Bancgroup, Inc. 308 2,714 Commerce Bancorp, Inc. 310 18,774 Commercial Federal Corp. 166 2,905 Community First Bankshares, Inc. 403 6,247 Corus Bankshares, Inc. 100 3,969 CPB, Inc. 100 2,525 Cullen Frost Bankers, Inc. 111 3,698 CVB Financial Corp. 100 1,669 Dime Community Bancorp, Inc. 100 2,219 Doral Financial Corp. 500 8,938 Downey Financial Corp. 131 6,255 East West Bancorp, Inc. 390 7,386 F & M Bancorp 105 2,139 F & M National Corp. 103 2,665 F N B Corp. 110 2,365 First Bancorp 200 4,588 First Busey Corp. 100 1,831 First Charter Corp. 156 2,408 First Commonwealth Financial Corp. 500 4,969 First Citizens Bancshares, Inc. 35 2,590 First Federal Capital Corp. 100 1,175 First Financial Bancorp 341 5,286 First Financial Bankshares, Inc. 100 3,075 First Financial Holdings, Inc. 100 1,688 First Indiana Corp. 100 2,300 First Merchants Corp. 100 2,300 First Midwest Bancorp, Inc. 350 8,772 First Niagara Financial Group, Inc. 100 906 First Sentinel Bancorp, Inc. 400 3,713 Firstfed Financial Corp.* 118 3,009 Frontier Financial Corp. 100 1,875 Fulton Financial Corp. 226 4,944 GBC Bancorp 85 2,709 Gold Banc Corp., Inc. 731 3,381 Greater Bay Bancorp 420 13,676 Hancock Holding Co. 100 3,113 Harbor Florida Bancshares, Inc. 100 1,225 Harleysville National Corp. 105 3,229 Hudson United Bancorp 565 12,642 Imperial Bancorp 324 7,877 Independence Community Bank 500 7,344 Integra Bank Corp 110 2,839 International Bancshares Corp. 156 5,587 Investors Financial Services Corp. 300 21,506 Irwin Financial Corp. 100 1,544 MAF Bancorp Inc. 200 4,800 Merchants NY Bancorp, Inc. 124 2,573 Mid American Bancorp 100 2,488 Mid State Bancshares 100 2,950 National Penn Bancshares, Inc. 115 2,444 Netbank, Inc.* 340 2,954
The accompanying notes are an integral part of the financial statements. 60 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Banks - continued Northwest Bancorp, Inc. 100 $744 Oceanfirst Financial Corp. 100 2,094 Ocwen Financial Corp.* 300 1,763 Omega Financial Corp. 100 2,888 Oriental Financial Group, Inc. 100 1,225 Pacific Capital Bancorp 200 5,350 Pacific Northwest Bancorp* 100 1,338 Park National Corp. 100 9,563 Premier National Bancorp, Inc. 100 2,050 Provident Bankshares Corp. 220 4,166 Provident Financial Group, Inc. 7 212 Queens County Bancorp 108 3,024 R & G Financial Corp. 100 981 Republic Bancorp, Inc. 420 3,990 Republic Security Financial Corp. 400 2,713 Richmond County Financial Corp. 460 10,810 Riggs National Corp. 123 1,384 Roslyn Bancorp, Inc. 618 13,403 S & T Bancorp, Inc. 200 3,775 Sandy Spring Bancorp, Inc. 100 2,213 Santander Bancorp 20 305 Seacoast Financial Services Corp. 200 2,125 Silicon Valley Bancshares* 412 19,055 Sky Financial Group Inc. 1,071 17,812 South Financial Group, Inc. 417 4,248 Southwest Bancorporation* 300 10,950 Staten Island Bancorp, Inc. 400 7,725 Sterling Bancshares, Inc. 200 3,438 Susquehanna Bancshares, Inc. 300 4,238 Texas Regional Bancshares, Inc. 100 2,988 The Trust Company Of N J 105 1,509 Trustco Bank Corp N Y 460 5,520 Trustmark Corp. 142 2,698 U S B Holding, Inc. 105 1,306 UMB Financial Corp. 110 3,726 United Bankshares, Inc. 400 7,800 United National Bancorp 100 1,775 United Community Financial 300 2,100 W Holding Co., Inc. 400 3,700 Washington Federal, Inc. 500 11,156 Webster Financial Corp. 300 7,313 Wesbanco, Inc. 129 2,991 Westamerica Bancorporation 90 3,234 Westcorp, Inc. 100 1,550 Whitney Holding Corp. 145 5,348 ----------- 553,124 Beverages - 0.15% Constellation Brands, Inc.* 100 4,875 Mondavi, Robert Corp.* 100 4,525 Pepsiamericas, Inc.* 97 352 Triarc Cos., Inc.* 100 2,493 ----------- 12,245
Shares Value ------ ----- Biotechnology - 3.05% Aclara Biosciences, Inc.* 51 $912 Advanced Tissue Sciences, Inc.* 572 4,076 Albany Molecular Research, Inc.* 100 5,813 Alexion Pharmaceuticals, Inc.* 89 9,200 Alliance Pharmaceutical Corp* 335 4,732 Avant Immunotherapeutics, Inc.* 313 2,641 Avigen, Inc.* 90 3,488 Aviron* 115 7,518 Bio-Technology General Corp.* 400 4,200 Biocryst Pharmaceuticals, Inc.* 73 666 Biomarin Pharmaceutical, Inc.* 96 1,248 Biomatrix, Inc.* 100 1,913 Biopure Corp.* 70 1,439 Cell Genesys, Inc.* 229 5,281 Cerus Corp* 53 2,961 Collateral Therapeutics* 49 1,239 Connetics Corp.* 584 3,057 Corixa Corp.* 131 5,830 Curagen Corp.* 184 11,891 CV Therapeutics, Inc.* 102 8,033 Digene Corp.* 172 5,582 Edwards Lifesciences Corp.* 375 5,039 Entremed, Inc.* 100 3,113 Enzo Biochem, Inc.* 161 6,199 Exelixis, Inc.* 50 1,103 Geltex Pharmaceuticals, Inc.* 150 7,444 Gene Logic, Inc.* 191 4,166 Genome Therapeutics Corp.* 148 2,211 Genta, Inc.* 27 218 Genzyme Transgenics Corp.* 118 2,530 Geron Corp.* 146 3,431 Hyseq, Inc.* 65 1,889 Idexx Labs, Inc.* 300 7,200 Ilex Oncology, Inc.* 252 9,135 Immune Response Corp.* 136 825 Immunomedics, Inc.* 323 7,469 Invitrogen Corp.* 148 11,238 Lexicon Genetics, Inc.* 55 1,114 Luminex Corp.* 29 787 Lynx Therapeutics, Inc. 68 1,190 Maxim Pharmaceuticals, Inc. 136 6,035 Maxygen, Inc. 45 1,811 Myriad Genetics, Inc. 130 15,600 Neorx Corp.* 131 2,129 Neose Technologies, Inc.* 67 2,425 Neurocrine Biosciences, Inc.* 141 5,464 Neurogen Corp.* 100 3,144 Orchid Biosciences, Inc.* 27 552 Organogenesis, Inc.* 300 3,762 Paradigm Enetics, Inc.* 126 2,000 Peregrine Pharmaceuticals, Inc.* 519 1,249 Pharmacopeia, Inc.* 128 2,336 Photogen Technologies, Inc.* 64 288
The accompanying notes are an integral part of the financial statements. 61 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Biotechnology - continued Regeneron Pharmaceuticals, Inc.* 121 $3,237 Ribozyme Pharmaceuticals, Inc.* 57 1,208 Sangstat Medical Corp.* 600 6,000 Targeted Genetics Corp.* 229 2,290 Texas Biotechnology Corp.* 302 4,455 Transkaryotic Therapies, Inc.* 140 5,215 Valentis, Inc.* 184 1,587 Vaxgen, Inc.* 38 1,043 Vical, Inc.* 116 2,458 ----------- 242,309 Building Products - 0.54% Armstrong Holdings, Inc. 201 578 Comfort Systems USA, Inc.* 300 881 Coorstek, Inc.* 25 731 Dal-Tile International, Inc.* 500 6,188 Elcor Chemical Corp. 150 2,334 Insituform Technologies, Inc.* 129 4,604 Lennox International, Inc. 169 1,341 NCI Building Systems, Inc.* 119 1,852 Nortek, Inc.* 240 4,515 Owens Corning 269 370 Simpson Manufacturing, Inc.* 100 4,263 Trex Company, Inc.* 127 4,747 Universal Forest Products, Inc. 100 1,350 Watsco, Inc. 351 3,306 York International Corp. 218 5,927 ----------- 42,987 Chemicals - 1.88% Airgas, Inc.* 500 3,375 Albemarle Corp. 200 4,638 Arch Chemicals, Inc. 131 2,546 Calgon Carbon Corp. 320 1,880 Cambrex Corp. 150 5,991 Chemfirst, Inc. 117 2,691 Crompton Corp. 969 7,752 Cytec Industries, Inc.* 400 13,850 Ethyl Corp. 536 1,072 Ferro Corp. 300 6,150 Fuller, H B Co. 100 3,381 Georgia Gulf Corp. 300 4,013 Grace, W R & Co. 500 1,906 Great Lakes Chemical Corp. 265 8,844 International Specialty Products* 100 625 Lilly Industries, Inc. 147 4,410 Lubrizol Corp. 290 6,289 MacDermid, Inc. 100 2,150 Millennium Chemicals, Inc. 420 6,773 Minerals Technologies, Inc. 100 3,131 NL Industries, Inc. 100 2,363 Olin Corp. 400 7,100 OM Group, Inc. 200 9,250 Omnova Solutions, Inc. 300 1,688
Shares Value ------ ----- Chemicals - continued R.P.M. ,Inc. 562 $5,023 Schulman, A, Inc. 300 3,281 Scotts Co.* 290 10,368 Solutia, Inc. 711 9,065 Spartech Corp. 100 1,544 Stepan Chemical Co. 37 717 Valspar Corp. 204 5,571 Wd-40 Co. 100 2,186 ----------- 149,623 Commercial Services & Supplies - 3.68% 4 Kids Entertainment, Inc.* 17 245 ABM Industries, Inc. 105 2,933 Administaff, Inc.* 200 7,100 Advanced Marketing Services, Inc. 39 702 Advantage Learning Systems, Inc.* 100 2,969 Advent Software, Inc.* 190 11,364 Armor Holdings, Inc.* 222 3,455 Banta Corp. 200 4,613 Billing Concepts Corp.* 300 900 Bowne & Co., Inc. 338 2,831 Braun Consulting, Inc.* 43 324 Bright Horizons Family Solutions, Inc.* 100 2,500 C D I Corp.* 100 1,588 Career Education Corp.* 104 4,024 Casella Waste Systems, Inc.* 280 2,433 Catalytica, Inc.* 500 6,719 CCC Information Services Group, Inc.* 151 1,038 Central Parking Corp. 100 1,919 Centurybusiness Services, Inc.* 600 675 Cheap Tickets, Inc.* 169 1,796 Chemed Corp. 100 3,288 Coinstar, Inc.* 260 3,429 Compucredit Corp.* 100 3,088 Corporate Executive Board Co.* 200 9,225 Costar Group, Inc.* 87 2,719 Cypress Communications, Inc.* 53 142 Diamond Technology Partner, Inc.* 144 6,426 Digitalthink, Inc.* 24 846 e.MedSoft.com* 282 423 Edison Schools, Inc.* 62 1,701 Education Management Corp.* 123 3,813 Encompass Servics Corp.* 501 2,286 F Y I, Inc.* 100 4,013 Factset Research Systems, Inc. 125 4,734 First Consulting Group* 101 675 Futurelink Corp.* 266 482 G & K Services 100 2,763 Hall Kinion & Assoc., Inc.* 42 1,110 Harland, John H Co. 200 2,775 Heidrick & Struggles International, Inc.* 136 8,407 HON Industries, Inc. 337 8,109 Hypercom Corp.* 100 688
The accompanying notes are an integral part of the financial statements. 62 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Commercial Services & Supplies - continued Insurance Auto Auctions, Inc.* 13 $156 Ionics, Inc.* 104 2,178 ITT Educational Services, Inc.* 100 1,575 Kelly Services, Inc. 115 2,552 kforce.com, Inc.* 400 1,625 Kimball International, Inc.* 300 4,669 Korn / Ferry International* 243 8,505 Labor Ready, Inc.* 330 990 Learning Tree International, Inc.* 100 4,525 Mail Well Holdings, Inc.* 420 2,074 Management Network Group, Inc.* 29 382 Medquist, Inc.* 332 3,735 Memberworks, Inc.* 100 3,438 Meta Group, Inc.* 7 67 Modis Professional Services, Inc.* 630 2,599 Multex Systems, Inc.* 108 1,397 National Data Corp. 194 7,396 Navigant Consulting Co.* 300 1,144 NCO Group, Inc.* 247 5,403 Netcentives, Inc.* 254 1,810 New England Business Svc, Inc. 100 1,738 Nextcard, Inc.* 140 1,068 Ogden Corp.* 400 5,500 On Assignment, Inc.* 200 5,038 Pegasus Systems, Inc.* 150 2,559 Per Se Technologies Inc* 206 908 Pittston Brinks Group 396 6,287 Pre Paid Legal Svcs, Inc.* 124 5,441 Probusiness Services, Inc.* 250 8,172 Professional Detailing, Inc.* 14 1,241 Profit Recovery Group Intl., Inc.* 350 1,881 Prosofttraining.com* 85 595 Rollins, Inc. 110 1,987 Sitel Corp.* 400 1,125 Sodexho Marriott Services, Inc. 143 2,628 Sothebys Holdings, Inc. 257 6,987 Source Information Mgmt. Co.* 210 1,155 Spherion Corp.* 480 5,700 Standard Register Co. 100 1,200 Strayer Education, Inc. 28 674 Surmodics, Inc.* 31 1,628 Sylvan Learning Systems, Inc.* 185 2,856 Tanning Technology Corp.* 63 340 Tetra Tech, Inc.* 322 11,190 United Stationers, Inc.* 300 9,019 Volt Information Sciences, Inc.* 100 2,175 Wackenhut Corp.* 100 1,263 Wallace Computer Service, Inc. 400 5,800 Waste Connections, Inc.* 291 7,439 Xceed, Inc.* 100 78 Zomax Optical Media, Inc.* 200 1,213 ----------- 292,363
Shares Value ------ ----- Communications Equipment - 1.87% Adaptive Broadband Corp.* 300 $4,819 Airnet Commumication Corp.* 19 289 Allen Telecom, Inc.* 200 3,738 Anixter International, Inc.* 137 3,322 Arguss Holdings, Inc.* 100 1,250 Audiovox Corp.* 70 958 Aware, Inc.* 117 3,620 Brooktrout, Inc.* 100 1,444 C-Cor.net Corporation* 200 3,125 Cable Design Technologies Corp.* 450 10,378 Carrier Access Corp.* 100 1,250 Celeritek, Inc.* 61 2,017 Cobalt Networks, Inc.* 200 11,025 Computer Network Technology* 200 6,078 Cylink Corp.* 156 658 Davox Corp.* 9 88 Glenayre Technologies, Inc.* 500 4,125 Impsat Corp.* 74 888 Intelect Communications, Inc.* 481 541 Inter-Tel, Inc. 105 1,214 Interdigital Communications Corp.* 413 4,517 International Fibercom, Inc.* 200 2,575 LCC International, Inc.* 60 900 MCK Communications, Inc.* 52 813 Metawave Communications Corp.* 161 2,133 MRV Communications, Inc.* 400 15,800 Neon Communications, Inc.* 34 410 Netro Corp.* 354 7,722 Network Equipment Technologies, Inc.* 138 1,311 Network Peripherals, Inc.* 100 1,088 NX Networks, Inc.* 219 623 Osicom Technologies, Inc.* 77 2,464 P-Com, Inc.* 500 2,813 Plantronics, Inc.* 300 13,688 Proxim, Inc.* 200 12,125 Sonicwall, Inc.* 170 2,539 Spectralink Corp.* 57 424 Superior Telecom, Inc. 100 494 Symmetricom, Inc.* 87 1,109 Telaxis Communications Corp.* 16 72 Tut Systems, Inc.* 113 3,757 US Wireleless Corp.* 94 1,445 Viasat, Inc.* 94 2,068 Vyyo, Inc.* 37 819 Westell Technologies* 180 990 World Access, Inc.* 538 2,623 Xircom, Inc.* 200 2,825 ----------- 148,971 Computers & Peripherals - 1.29% 3dfx Interactive, Inc.* 190 808 Advanced Digital Information* 375 4,875 Avid Technology, Inc.* 144 1,998
The accompanying notes are an integral part of the financial statements. 63 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Computers & Peripherals - continued Concurrent Computer Corp.* 435 $7,667 Crossroads Systems, Inc.* 125 867 Dot Hill Systems Corp.* 70 241 DSP Group, Inc.* 200 5,675 e.Machines, Inc.* 92 95 Extended Systems, Inc. 53 2,067 Gadzoox Networks, Inc.* 205 756 Hutchinson Technology, Inc.* 200 4,388 Immersion Corp.* 91 899 Infocus Corp.* 156 6,893 Intergraph Corp.* 400 2,500 Interlink Electronics, Inc.* 79 1,768 Iomega Corp.* 2,200 10,802 JNI Corp.* 15 1,336 Maxtor Corp.* 500 3,906 Media 100, Inc.* 36 356 Micron Electronics, Inc.* 326 2,577 MTI Technology Corp.* 300 1,556 Paradyne Networks, Inc.* 103 412 Procom Technology, Inc.* 33 749 Quantum Corp.* 611 6,988 Rainbow Technologies, Inc.* 110 2,736 SCM Microsystems, Inc.* 100 3,800 Silicon Graphics, Inc.* 1,286 5,787 Storage Technology Corp.* 666 6,494 Universal Display Corp.* 77 1,328 Wave Systems Corp.* 400 4,625 Western Digital Corp.* 1,064 6,384 Xybernaut Corp.* 217 1,022 ------------ 102,355 Construction & Engineering - 0.40% Emcor Group, Inc.* 100 2,594 Foster Wheeler Corp. 400 2,950 Granite Construction, Inc. 121 2,760 Intergrated Electrical Svcs.* 300 2,063 Jacobs Engineering Group, Inc.* 142 5,875 SBA Communcations Corp.* 217 10,877 URS Corp.* 100 1,281 Washington Group Intl., Inc.* 306 3,213 ------------ 31,613 Construction Materials - 0.14% Amcol Intl. Corp. 200 1,475 Centex Construction Products, Inc. 100 2,594 Florida Rock Industries, Inc. 100 3,888 Texas Industries, Inc. 136 3,170 U S Aggregates, Inc. 5 70 ------------ 11,197 Containers & Packaging - 0.46% Ball Corp. 154 5,409 Caraustar Industries, Inc. 200 2,013 Chesapeake Corp. 100 1,963 Earthshell Corp.* 263 822
Shares Value ------ ----- Containers & Packaging - continued Gaylord Container Corp.* 400 $875 Greif Bros. Corp. 100 3,200 Ivex Packaging Corp.* 135 1,325 Longview Fibre Co. 433 5,900 Myers Industries, Inc. 132 1,749 Packaging Corp. of America* 150 2,203 Pactiv Corp.* 1,081 11,349 ------------ 36,808 Distributors - 0.03% Brightpoint, Inc.* 400 2,663 ------------ Diversified Financials - 2.79% Acacia Research Corp.* 83 2,640 Advanta Corp. 100 1,025 Affiliated Managers Group, Inc.* 286 17,196 Allied Capital Corp. 500 10,313 American Capital Strategies, Ltd. 315 6,950 Americredit Corp.* 800 21,500 Arch Capital Group, Ltd.* 100 1,550 Blackrock, Inc.* 93 3,964 Cash America Intl., Inc. 200 1,038 Charter Municipal Mortgage Accpt. Co. 133 1,794 Credit Acceptance Corp.* 100 613 Dain Rauscher Corp. 100 9,381 Donaldson Lufkin & Jenrette* 54 273 E-Loan, Inc.* 660 1,898 Eaton Vance Corp. 380 18,929 Espeed, Inc.* 62 1,302 Financial Federal Corp.* 220 4,661 Finova Group, Inc. 350 897 Friedman, Billings, Ramsey Group, Inc.* 149 1,192 Frontline Capital Group* 166 2,366 Gabelli Asset Mgmt., Inc.* 130 4,680 Globalnet Financial.com, Inc.* 166 747 Investment Technology Group* 166 5,976 Jeffries Group, Inc. 137 3,733 Labranche & Co., Inc.* 203 8,044 Leucadia National Corp. 400 9,950 Liberty Financial Cos., Inc. 100 2,700 Medallion Financial Corp. 100 1,538 Metris Companies, Inc. 611 19,781 Morgan Keegan, Inc. 200 3,988 National Discount Brokers Group* 100 4,869 On2.COM, Inc.* 99 226 Pennaco Energy, Inc.* 351 4,366 PFF Bancorp, Inc. 100 1,850 Phoenix Investment Partners, Ltd.* 500 7,813 Raymond James Financial, Inc. 400 13,525 Southwest Securities Group 121 3,418 The Intercept Group, Inc.* 31 839 Triad Guaranty, Inc.* 100 2,906
The accompanying notes are an integral part of the financial statements. 64 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Diversified Financials - continued Tucker Anthony Sutro Corp. 100 $2,313 Walter Industries, Inc. 400 2,975 WFS Financial, Inc.* 27 425 Wit Soundview Group, Inc.* 794 5,653 ------------ 221,797 Diversified Telecommunication - 1.22% Adelphia Business Solutions* 203 1,269 Alamosa PCS Holdings, Inc.* 34 516 Alaska Communications Sys., Inc.* 54 368 Allied Riser Communications Corp.* 587 1,871 Arch Wireless, Inc.* 330 990 Caprock Communications Corp.* 300 2,138 CFW Communications Co. 100 1,988 Choice One Communications, Inc.* 48 519 Commonwealth Telephone Entrps, Inc.* 100 3,463 CT Communications, Inc. 200 4,013 CTC Communications Group, Inc.* 150 1,448 Deltathree.com, Inc.* 55 165 E-Spire Communications, Inc.* 430 1,183 Eglobe, Inc.* 373 152 Electric Lightware, Inc.* 100 575 Fibernet Telecom. Group, Inc.* 53 566 Firstworld Communications* 56 84 General Communication, Inc.* 300 2,344 Goamerica, Inc.* 69 720 Golden Telecommunications, Inc.* 48 744 Hickory Tech Corp. 60 1,365 Ibasis, Inc.* 79 612 ICG Communications, Inc.* 600 263 IDT Corp.* 154 5,506 Illuminet Holdings, Inc.* 151 3,636 Intermedia Communications, Inc.* 400 8,850 ITC Deltacom, Inc.* 400 3,238 ITCX Corp.* 131 1,384 Leap Wireless Intl., Inc.* 181 9,005 Metricom, Inc.* 136 2,414 Metrocall, Inc.* 526 674 Motient Corp.* 222 2,692 Mpower Communications Corp.* 364 2,366 Net2000 Communication, Inc.* 60 360 Net2phone, Inc.* 142 2,636 Network Access Solutions Corp.* 105 285 Network Plus Corp.* 54 425 North Pittsburgh Systems, Inc. 107 1,271 Pac-West Telecomm, Inc.* 114 990 Price Communications Corp.* 465 10,056 Primus Telecomm Group, Inc.* 273 1,382 Rhythms Netconnections, Inc.* 557 1,218 Talk.com, Inc.* 400 1,238 Teligent, Inc.* 216 1,640 Telocity, Inc.* 55 158 Us LEC Corp.* 100 600
Shares Value ------ ----- Diversified Telecommunication - continued Viatel, Inc.* 376 $3,619 Weblink Wireless, Inc.* 337 2,675 Worldpages.com, Inc.* 269 689 Z Tel Technologies, Inc.* 22 187 ------------ 96,550 Electric Utilities - 1.92% Allete* 283 6,102 Black Hills Corp. 138 4,313 CH Energy Group, Inc. 109 4,292 Cleco Corp. 445 21,165 Conectiv, Inc. 824 14,781 El Paso Electric Co.* 500 5,995 Empire District Electric Co. 112 3,101 Energy East Corp. 118 2,382 Hawaiian Electric Industries, Inc. 308 10,145 Idacorp, Inc. 300 14,794 Kansas City Power & Light Co. 263 6,328 Madison Gas & Electric Co. 100 2,175 MDU Resources Group, Inc. 500 14,625 OGE Energy Corp. 211 4,339 Otter Tail Power Co. 200 4,438 Public Service Co. New Mexico 300 8,269 RGS Energy Group, Inc. 334 9,853 UIL Holding Corp. 100 4,681 Unisource Energy Corp. 300 4,481 WPS Resources Corp. 200 6,436 ------------ 152,695 Electrical Equipment - 2.22% Advanced Lighting Technologies, Inc.* 89 1,062 American Technical Ceramics* 3 46 Ametek Aerospace Products, Inc. 307 6,677 Anaren Microwave, Inc.* 76 7,904 Artesyn Technologies, Inc.* 315 12,797 Asyst Technologies, Inc.* 283 4,245 Baldor Electric Co. 308 6,122 Bel Fuse, Inc. 33 1,324 Belden, Inc. 200 5,188 Benchmark Electronics, Inc.* 100 4,025 Brady Corp. 134 4,154 C&D Technologies 271 16,023 CTS Corp. 200 8,588 Electro Scientific Industries, Inc.* 200 6,988 Excel Technology, Inc.* 39 975 Franklin Electric, Inc. 5 341 General Cable Corp. 300 1,800 Genlyte Group, Inc.* 100 2,588 Littelfuse, Inc.* 126 3,654 Magnetek, Inc.* 200 2,175 MKS Instruments Inc.* 3 55 National Service Industries, Inc. 115 2,350 Paxar Corp.* 400 3,275 Penn Engineering & Mfg Corp. 3 113
The accompanying notes are an integral part of the financial statements. 65 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Electrical Equipment - continued Plexus Corp.* 238 $15,009 Power Integrations* 167 2,244 Rayovac Corp.* 310 4,573 Satcon Technology Corp.* 128 3,264 Sensormatic Electronics Corp.* 600 10,800 SLI Inc. 100 825 Smith A O Corp. 136 1,921 Technitrol, Inc. 100 11,088 Tecumseh Products, Co. 26 1,037 Telxon Corp.* 89 1,997 Three Five Systems, Inc.* 140 4,830 Triumph Group, Inc.* 100 3,400 Vicor Corp.* 120 6,480 Wesco Intl., Inc.* 300 2,513 Woodhead Industries 39 858 Zixit Corp.* 120 2,929 ------------ 176,237 Electronic Equipment & Instruments - 3.06% ACT Manufacturing, Inc.* 61 2,005 Anadigics, Inc.* 207 4,632 Analogic Corp. 20 706 Applied Micro Circuits Corp.* 332 25,340 Aurora Bioscience Corp.* 193 11,761 California Amplifier, Inc.* 72 1,800 Caliper Technologies Corp.* 20 1,128 Checkpoint Systems, Inc.* 300 2,381 Cohu, Inc. 100 1,581 Cyberoptics Corp.* 14 329 DDI Corporation* 58 2,316 Emagin Corp.* 100 865 Exar Corp.* 300 13,406 Fisher Scientific Intl., Inc.* 400 15,375 Fuelcell Energy, Inc.* 22 1,684 Harman Intl. Industries, Inc. 208 9,984 HI / FN, Inc.* 22 1,359 Identix, Inc.* 162 2,333 Ii-Vi, Inc.* 32 662 Interlogix, Inc.* 46 566 Ixys Corp.* 4 101 Keithley Instruments, Inc. 49 2,622 Kent Electronics Corp.* 200 3,725 Lightpath Technologies, Inc.* 78 2,126 Mattson Technology, Inc.* 94 1,105 Meade Instruments Corp.* 13 238 Mechanical Technology, Inc.* 157 1,178 MEMC Electronics Materials, Inc.* 300 2,981 Methode Electronics, Inc. 300 11,288 Mettler Toledo Intl., Inc.* 349 16,294 MIPS Technologies, Inc.* 300 12,038 Nanometrics, Inc.* 19 437 Park Electrochemical Corp. 100 6,606 Photon Dynamics, Inc.* 76 2,736
Shares Value ------ ----- Electronic Equipment & Instruments - continued Pioneer Standard Electronics, Inc. 150 $2,081 Pixelworks, Inc.* 100 3,331 PLX Technology, Inc.* 101 2,424 Quicklogic Corp.* 183 1,624 Research Frontiers, Inc.* 57 1,097 Robotic Vision Systems, Inc.* 238 1,302 Rudolph Technologies, Inc.* 24 936 SBS Technologies, Inc.* 40 1,030 Sipex Corp.* 144 5,670 Somera Communications, Inc.* 174 1,958 Spectra Physics Lasers, Inc.* 11 388 Stanford Microdevices, Inc.* 100 2,506 Superconductor Technologies* 118 1,195 Supertex, Inc.* 26 738 Symyx Technologies, Inc.* 146 6,889 Teledyne Technologies, Inc.* 173 4,336 Therma Wave, Inc.* 63 1,292 Tollgrade Communications, Inc.* 79 7,564 Trimble Navigation Ltd.* 150 3,563 Varian, Inc.* 300 9,244 Veeco Instruments, Inc.* 159 10,526 Viasystems Group, Inc.* 282 4,001 Wink Communications, Inc.* 138 1,415 X Rite, Inc. 44 297 Zygo Corp.* 90 4,453 ------------ 243,548 Energy Equipment & Services - 0.95% Atwood Oceanics, Inc.* 100 3,356 CAL Dive Intl., Inc.* 7 348 Carbo Ceramics, Inc. 19 569 Dril-Quip, Inc.* 100 3,300 Friede Goldman Halter, Inc.* 300 1,725 Horizon Offshore, Inc.* 192 2,640 Input/Output, Inc.* 400 3,375 Key Energy Services, Inc.* 990 8,910 Lone Star Technologies, Inc.* 146 5,862 Newpark Resources, Inc.* 545 4,905 Oceaneering Intl., Inc.* 100 1,406 Offshore Logistics, Inc.* 100 1,725 Parker Drilling Co.* 500 3,000 Patterson Energy, Inc.* 371 10,434 RPC, Inc. 100 1,244 Seacor Smit, Inc.* 150 6,281 Seitel, Inc.* 200 3,000 Superior Energy Svcs., Inc.* 400 3,600 UTI Energy Corp.* 200 4,013 Veritas DGC, Inc.* 200 6,000 ------------ 75,693 Food & Drug Retailing - 0.59% Brio Technology, Inc.* 250 2,047 Caseys General Stores, Inc. 400 5,000 Duane Reade, Inc.* 100 2,919
The accompanying notes are an integral part of the financial statements. 66 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Food & Drug Retailing - continued Fleming Cos., Inc. 350 $4,966 Great Atlantic & Pacific Tea, Inc. 100 1,000 Ingles Markets, Inc. 100 988 Longs Drug Stores Corp. 192 4,200 Performance Food Group Co.* 220 8,910 Ruddick Corp. 300 3,938 United Natural Foods, Inc.* 100 1,256 Whole Foods Market, Inc.* 200 9,250 Wild Oats Markets, Inc.* 410 2,587 ------------ 47,061 Food Products - 1.61% Agribrands Intl., Inc.* 100 4,350 American Italian Pasta Co.* 350 7,022 Aurora Foods, Inc.* 680 1,913 Cadiz, Inc.* 580 6,163 Chiquita Brands Intl., Inc. 400 775 Corn Products Intl., Inc. 300 7,538 Dean Foods Co. 198 6,336 Del Monte Foods Co.* 500 3,031 Delta & Pine Land Co. 300 7,331 Dole Food, Inc. 252 3,040 Dreyers Grand Ice Cream, Inc. 330 8,126 Earthgrains Co. 400 8,100 Farmer Bros. Co. 1 195 Hain Celestial Group, Inc.* 353 14,010 International Multifoods Corp. 106 1,795 Interstate Bakeries Corp. 168 2,352 Lance, Inc. 200 2,013 Michael Foods, Inc. 100 2,694 Pilgrims Pride Corp. 100 675 Ralcorp Holdings, Inc.* 285 4,008 Rica Foods, Inc.* 48 732 Riviana Foods, Inc. 47 799 Sensient Technologies Corp.* 403 7,959 Smithfield Foods, Inc.* 300 8,606 Smucker, J M Co.* 200 4,450 Suiza Foods Corp.* 300 13,894 Tejon Ranch Co. 2 43 ------------ 127,950 Gas Utilities - 1.59% AGL Resources, Inc. 500 10,188 Atmos Energy Corp. 400 9,250 Cascade Natural Gas Corp. 100 1,844 Energen Corp. 280 8,015 Laclede Gas Co. 122 2,669 Midcoast Energy Resources, Inc. 400 8,100 New Jersey Resources Corp. 100 3,994 Northwest Natural Gas Co. 200 4,688 NUI Corp. 100 3,119 Oneok, Inc. 400 15,850 Piedmont Natural Gas, Inc. 300 9,150 Semco Energy, Inc. 115 1,783
Shares Value ------ ----- Gas Utilities - continued South Jersey Industries, Inc. 100 $2,913 Southern Union Co. 325 6,114 Southwest Gas Corp. 300 6,263 Southwestern Energy Co. 200 1,600 Transmontaigne, Inc.* 200 775 UGI Corp. 305 7,072 Vectren Corp. 566 13,085 WGL Holdings, Inc.* 400 10,200 ------------ 126,672 Health Care Equipment & Supplies - 2.96% Abiomed, Inc.* 72 2,088 Acuson Corp.* 100 2,281 Adac Laboratories* 96 1,248 Aradigm Corp.* 107 2,367 Arrow International, Inc. 100 4,031 Arthrocare Corp.* 300 6,806 Aspect Medical Systems, Inc.* 115 1,021 ATS Medical, Inc.* 86 1,575 Bio-Rad Laboratories, Inc.* 100 2,990 Biosite Diagnostics, Inc.* 95 2,090 Cardiodynamics Intl., Corp.* 654 3,434 Celsion Corp.* 302 604 Chromavision Medical Systems, Inc.* 260 1,235 Closure Medical Corp.* 177 4,292 Coherent, Inc.* 200 6,963 Conmed Corp.* 100 1,469 Cooper Cos., Inc. 100 3,575 Cyberonics, Inc.* 315 7,324 Cygnus, Inc.* 154 1,376 Datascope Corp. 100 3,463 Diagnostic Products Corp. 100 4,563 Diametrics Medical, Inc.* 613 5,057 Endocare, Inc.* 170 3,007 Enzon, Inc.* 400 28,500 Gliatech, Inc.* 150 966 Haemonetics Corp.* 200 4,700 Henry Schein, Inc.* 200 4,875 I-Stat Corp.* 76 1,492 Igen Intl., Inc.* 100 2,488 Imatron, Inc.* 495 1,067 Inamed Corp.* 73 2,044 Inhale Therapeutic Systems* 222 11,045 Invacare Corp. 200 5,700 Mentor Corp. 134 2,362 Molecular Devices Corp.* 100 6,838 Nabi* 175 1,069 Nanogen, Inc.* 100 1,550 Nexell Therapeutics, Inc.* 207 1,478 Noven Pharmaceuticals, Inc.* 224 9,982 Novoste Corp.* 100 2,525 Ocular Sciences, Inc.* 100 1,238 Oratec Interventions, Inc.* 28 280
The accompanying notes are an integral part of the financial statements. 67 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Health Care Equipment & Supplies - continued Packard Bioscience Co.* 46 $742 Polymedica Corp.* 169 9,718 Resmed, Inc.* 300 7,650 Respironics, Inc.* 313 6,143 Scott Technologies, Inc.* 100 2,300 Sonic Innovations, Inc.* 70 337 Sonosite, Inc.* 51 650 Staar Surgical Co.* 2 32 Steris Corp.* 500 7,500 Sunrise Technologies Intl.* 400 2,888 Theragenics Corp.* 200 938 Thermo Cardiosystems, Inc.* 101 827 Thoratec Labs Corp.* 84 1,024 Varian Medical Systems, Inc.* 300 14,663 Vasomedical, Inc.* 298 1,136 Ventana Medical Systems, Inc.* 100 2,625 Visx, Inc.* 397 8,511 Vital Signs, Inc. 42 1,307 West Pharmaceutical Svcs., Inc. 100 2,200 Zoll Medical Corp.* 29 1,430 ------------ 235,679 Health Care Providers & Services - 3.91% Accredo Health, Inc.* 34 1,471 Advance Paradiam, Inc.* 522 25,513 Ameripath, Inc.* 100 1,794 Amerisource Health Corp.* 400 17,375 Apria Healthcare Group, Inc.* 400 8,000 Bergen Brunswig Corp. 912 8,265 Beverly Enterprises, Inc.* 800 4,000 Bindley Westn Industries, Inc. 135 4,852 Caremark Rx, Inc.* 1,600 20,000 Covance, Inc.* 500 4,313 Coventry Health Care, Inc.* 500 9,125 Cryolife, Inc.* 9 358 Cyber Care, Inc.* 434 2,129 Davita, Inc.* 600 6,750 DVI, Inc.* 230 3,853 Eclipsys Corp.* 300 7,406 Health Net, Inc.* 651 13,142 Hooper Holmes, Inc. 500 4,745 Humana, Inc.* 1,000 12,125 Impath, Inc.* 200 15,125 Laboratory Corp. of America Holdings* 40 5,395 Lifepoint Hospitals, Inc.* 300 11,625 Lincare Holdings, Inc.* 197 8,286 Manor Care, Inc.* 503 8,394 Maximus, Inc.* 100 2,456 Microvision, Inc. 74 2,521 Mid Atlantic Medical Services, Inc.* 400 6,800 Omnicare, Inc. 628 10,990 Orthodontic Centers of America, Inc.* 400 13,350 Owens & Minor, Inc. 300 4,538
Shares Value ------ ----- Health Care Providers & Services - continued Parexel Intl. Corp.* 200 $1,750 Pharmaceutical Prod. Dvlpmnt, Inc.* 119 3,726 Province Healthcare Co.* 193 8,130 PSS World Medical, Inc.* 600 1,800 Quorum Health Group, Inc.* 600 8,025 Renal Care Group, Inc.* 400 9,400 Res-Care, Inc.* 100 550 Service Corp Intl.* 1,914 4,426 Stericycle, Inc.* 280 9,065 Stewart Enterprises, Inc. 471 1,001 Sunrise Assisted Living, Inc.* 100 2,338 Syncor Intl. Corp.* 200 5,138 Triad Hospitals, Inc.* 300 8,325 US Oncology, Inc.* 488 2,620 ------------ 310,990 Hotels, Restaurants & Leisure - 2.39% American Classic Voyages Co.* 100 1,381 Anchor Gaming* 7 595 Applebees Intl., Inc. 200 6,041 Argosy Gaming Corp.* 380 6,175 Aztar Corp.* 400 6,050 Bally Total Fitness Hldg. Corp.* 200 4,988 Bob Evans Farms, Inc. 300 5,644 Boca Resorts, Inc.* 380 5,154 Boyd Gaming Corp.* 300 1,181 Buca, Inc.* 583 9,109 CBRL Group, Inc. 500 8,938 CEC Entertainment, Inc.* 155 4,941 Cheesecake Factory* 340 15,066 Choice Hotels, Inc.* 500 5,875 Churchill Downs, Inc.* 100 2,800 Consolidated Products, Inc. 175 1,323 Dover Downs Entertainment, Inc. 100 1,175 Extended Stay America, Inc.* 720 8,865 Gtech Holdings Corp.* 343 5,938 Ihop Corp.* 100 2,113 Isle of Capri Casinos, Inc.* 324 3,564 Jack In The Box, Inc.* 400 9,800 Krispy Kreme Doughnuts, Inc.* 19 1,873 Landrys Seafood Restaurants, Inc. 200 1,613 Lone Star Steakhouse & Saloon 214 1,806 Lubys Cafeterias, Inc. 233 1,369 Marcus Corp. 100 1,419 Morrison Mgmt. Specialists, Inc. 110 3,685 NPC Intl., Inc.* 100 1,113 O'Charleys, Inc.* 100 1,463 Papa Johns Intl., Inc.* 350 8,794 Penn National Gaming, Inc.* 225 3,938 Pinnacle Entertainment, Inc.* 350 7,984 Prime Hospitality Corp.* 415 3,943 Rare Hospitality Intl., Inc.* 150 3,488 Ruby Tuesday, Inc. 600 8,138
The accompanying notes are an integral part of the financial statements. 68 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Hotels, Restaurants & Leisure - continued Ryans Family Steak Houses, Inc.* 300 $2,513 Sonic Corp.* 100 3,650 Speedway Motorsports, Inc.* 201 3,505 Station Casinos, Inc.* 300 4,838 Vail Resorts, Inc.* 144 3,051 WMS Industries, Inc.* 148 3,293 Wyndham Intl., Inc.* 1,100 1,781 ------------ 189,973 Household Durables - 2.22% American Greetings Corp. 410 7,457 Applica, Inc.* 646 3,270 Blyth Industries, Inc. 190 4,940 Centex Corp. 340 12,580 Champion Enterprises, Inc.* 400 1,550 Clayton Homes, Inc. 482 4,428 Crossmann Communities, Inc.* 12 215 D.R.Horton, Inc. 436 8,066 Ethan Allen Interiors, Inc. 400 11,700 Fedders USA, Inc. 300 1,275 Fleetwood Enterprises, Inc. 300 3,956 Furniture Brands Intl., Inc.* 400 6,750 Interface, Inc. 400 3,650 Kaufman & Broad Home Corp. 400 11,900 La-Z-Boy, Inc. 400 6,300 Lancaster Colony Corp. 102 2,410 Lennar Corp. 402 12,914 Libbey, Inc. 100 2,725 M.D.C. Holdings, Inc. 100 2,738 Metromedia Inter. Grp., Inc.* 504 1,875 Mohawk Industries, Inc.* 210 4,581 National Presto Industries, Inc. 47 1,428 NVR, Inc.* 100 10,340 Oneida Ltd. 100 1,063 Palm Harbor Homes, Inc.* 100 1,463 Pulte Corp. 300 9,994 Russ Berrie & Co., Inc. 100 2,269 Ryland Group, Inc. 100 3,225 Salton, Inc.* 100 2,288 Springs Industries, Inc. 100 2,356 Standard-Pacific Corp. 200 3,750 Sunbeam Corp.* 756 709 Toll Bros., Inc.* 134 4,355 Topps, Inc.* 400 3,613 Toro Co. 100 3,500 Tupperware Corp. 500 8,563 Universal Electronics, Inc.* 77 1,415 Westpoint Stevens, Inc. 176 1,262 ------------ 176,873 Household Products - 0.42% Block Drug, Inc. 106 5,545 Boyds Collection Ltd.* 446 3,540 Church & Dwight ,Inc. 400 7,900
Shares Value ------ ----- Household Products - continued Dial Corp. 484 $5,415 Herbalife Intl., Inc. 100 844 Mathews Intl. Corp. 100 2,700 Oakley, Inc.* 200 4,200 Playtex Products, Inc.* 300 3,037 ------------ 33,181 Industrial Conglomerates - 0.51% Brokat Aktiengesellschaft* 1 21 Carlisle Cos., Inc. 166 6,910 Gentek, Inc. 100 1,669 Harbor Global Company Ltd.* 40 161 Hotel Reservations Network, Inc.* 38 1,330 Mobile Mini, Inc.* 174 3,469 Polyone Corp.* 670 5,276 Standex Intl., Corp. 100 1,831 Teleflex, Inc. 208 7,189 Tredegar Industries, Inc. 130 2,478 U S Industries, Inc. 487 4,322 Uniroyal Technology* 74 754 Valmont Industries, Inc. 112 2,282 Waypoint Financial Corp.* 76 732 Yankee Candle, Inc.* 153 2,247 ------------ 40,671 Insurance - 2.06% Alfa Corp 400 7,700 Argonaut Group, Inc. 108 1,856 Baldwin & Lyons, Inc. 100 1,894 Berkley, W R Corp. 100 3,406 Blanch, E W Holdings, Inc. 100 1,888 Brown & Brown, Inc. 200 6,500 CNA Surety Corp. 107 1,244 Commerce Group, Inc. 200 5,113 Crawford & Co. 300 3,750 Delphi Financial One Group, Inc. 106 3,922 Enhance Financial Svcs. Group, Inc. 200 2,325 FBL Financial Group, Inc. 100 1,606 Fidelity Natl. Financial, Inc. 285 7,000 First American Financial Corp. 500 10,469 Fremont General Corp. 346 1,254 Gallagher, Arthur J & Co. 300 18,938 Harleysville Group, Inc. 100 2,306 HCC Insurance Holdings, Inc. 400 7,625 Hilb Rogal & Hamilton Co. 100 3,963 Horace Mann Educators Corp. 400 6,725 HSB Group, Inc. 300 11,869 Landamerica Financial Group, Inc. 100 2,950 Liberty Corp. 100 3,463 Markel Corp.* 16 2,318 Medical Assurance, Inc.* 152 2,109 Mercury General Corp. 83 3,040 Ohio Casualty Corp. 500 4,203 Philadelphia Consol. Holding Co.* 100 2,231
The accompanying notes are an integral part of the financial statements. 69 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Insurance - continued Pico Holdings, Inc.* 100 $1,288 PMA Capital Corp. 100 1,638 Presidential Life Corp. 200 2,913 Reliance Group Hldggs., Inc. 500 31 Rightchoice Managed Care, Inc.* 160 4,420 RLI Corp. 100 3,913 Scpie Holdings, Inc. 100 1,900 Selective Insurance Group, Inc. 200 3,450 Stancorp Financial Group, Inc. 119 4,849 State Auto Financial Corp. 100 1,350 Stewart Information Svcs. Corp. 100 1,575 UICI* 300 2,231 Zenith National Insurance Corp. 100 2,272 ------------ 163,497 Internet & Catalog Retail - 0.37% Barnesandnoble.com, Inc.* 300 1,172 Buy.com, Inc.* 38 82 Drugstore.com, Inc.* 298 782 Envision Dev. Corp.* 15 54 Etoys, Inc.* 841 3,154 Flowers.com, Inc.* 20 78 Insight Enterprises, Inc.* 360 11,700 Lands End, Inc.* 100 2,565 Network Commerce, Inc.* 303 900 Stamps.com, Inc.* 354 1,394 Valuevision Intl., Inc.* 360 7,290 ------------ 29,171 Internet Software & Services - 1.21% About.com, Inc.* 99 2,376 Accrue Software, Inc.* 250 1,156 Allscripts, Inc.* 211 2,532 Avenue A, Inc.* 23 98 Avocent Corp.* 442 31,354 Bell & Howell Co.* 100 1,900 Bluestone Software, Inc.* 74 1,591 CAIS Internet, Inc.* 46 194 Cnet Networks, Inc.* 67 2,111 Digital Island, Inc.* 505 6,376 Egain Communications Corp.* 232 1,508 Excelon Corporation* 158 1,284 Expedia, Inc.* 26 333 Globix Corp.* 268 2,714 Hollywood.com, Inc.* 112 847 Ibeam Broadcasting Corp.* 29 163 Infousa, Inc.* 170 553 Ivillage, Inc.* 236 561 Juno Online Svcs., Inc.* 119 316 Lante Corp. 17 63 Latitude Communications, Inc.* 164 943 Marimba, Inc.* 246 1,461 Marketwatch.com, Inc.* 9 42 NBC Internet, Inc.* 393 2,432
Shares Value ------ ----- Internet Software & Services - continued Net Perceptions, Inc. 400 $1,325 Netopia. Inc.* 100 1,088 Onvia.com, Inc.* 35 92 Open Market, Inc.* 300 994 Organic, Inc.* 27 88 Packeteer, Inc.* 120 2,985 Prodigy Communications Corp.* 133 582 Rare Medium Group, Inc.* 274 1,267 Savvis Communications Corp.* 45 174 Seebeyond Technology Corp.* 11 187 Sequoia Software Corp.* 105 525 Softnet Systems, Inc.* 197 911 Sportsline USA, Inc.* 426 3,648 Starmedia Network, Inc.* 667 4,085 Switchboard, Inc.* 25 163 Travelocity.com, Inc.* 100 1,413 Universal Access, Inc.* 66 965 VelocityHSI, Inc.* 80 85 Ventro Corp.* 159 765 Via Net.Works, Inc.* 102 755 Watchguard Technologies, Inc.* 79 3,950 Women.com Networks, Inc.* 97 142 Worldgate Communications, Inc.* 400 7,472 ------------ 96,569 IT Consulting Services - 0.76% Analysts Intl. Corp. 138 863 Cambridge Technology Ptnrs., Inc.* 400 1,550 Ciber, Inc.* 400 3,125 Com21, Inc.* 303 3,276 Complete Busines Solutions, Inc.* 200 2,075 Computer Horizons Corp.* 301 1,505 Cybersource Corp.* 424 2,332 Direct Focus, Inc.* 150 6,675 Eloyalty Corp.* 400 3,850 Epicedge, Inc.* 56 67 IDX Systems Corp.* 100 3,200 Inforte Corp.* 9 276 Lightbridge, Inc.* 117 1,250 Mynd Corp.* 300 3,825 Netegrity, Inc. 189 14,742 Netobjects, Inc.* 180 529 Netsolve, Inc.* 31 233 Perot Systems Corp.* 313 3,110 Priority Healthcare Corp.* 71 3,816 Startek, Inc.* 32 814 Sykes Enterprises, Inc.* 143 769 Technology Solutions Co. 400 950 Unova, Inc.* 400 1,924 ------------ 60,756 Leisure Equipment & Products - 0.62% 3DO Company (The)* 138 423 Arctic Cat, Inc. 100 1,281
The accompanying notes are an integral part of the financial statements. 70 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Leisure Equipment & Products - continued Callaway Golf Co. 600 $9,600 Championship Auto Racing Team* 100 2,488 Concord Camera Corp.* 117 3,620 Jakks Pac, Inc.* 107 943 Midway Games, Inc.* 300 2,325 Musicland Stores, Inc.* 200 1,625 Parkervision, Inc.* 41 2,286 Pinnacle Systems, Inc.* 370 4,671 Polaris Industries, Inc. 200 6,950 Polaroid Corp. 400 4,025 SCP Pool Corp.* 210 5,434 Sturm Ruger & Co., Inc. 100 844 Take Two Interactive Software* 254 3,158 ------------ 49,673 Machinery - 3.13% Actuant Corp.* 400 1,450 Advanced Energy Industries, Inc.* 100 1,725 Agco Corp. 500 5,688 Albany Intl. Corp.* 121 1,301 American Superconductor Corp.* 126 6,017 Applied Industrial Tech., Inc. 135 2,287 Aptargroup, Inc. 300 6,206 Astec Industries, Inc.* 260 2,681 Barnes Group, Inc. 100 1,925 Briggs & Stratton Corp. 87 3,105 Clarcor, Inc. 200 3,825 Columbus McKinnon Corp. 100 1,338 Cummins Engine, Inc. 245 8,330 Cuno, Inc.* 100 2,538 Dionex Corp.* 142 4,606 Donaldson, Inc. 400 9,050 Energy Conversion Devices, Inc.* 51 1,651 Esco Technologies, Inc.* 26 473 Esterline Technologies Corp.* 112 2,499 Flowserve Corp. 341 6,863 Gardner Denver, Inc.* 100 1,838 Graco, Inc. 100 3,594 Harsco Corp. 400 8,075 Idex Corp. 300 9,675 JLG Industries, Inc. 400 5,575 Kaydon Corp. 300 6,581 Kennametal, Inc. 200 5,875 Lincoln Electric Holdings, Inc. 341 5,861 Lindsay Manufacturing Co. 100 2,100 Manitowoc, Inc. 290 7,884 Maverick Tube Corp. 115 1,790 Milacron, Inc. 300 4,781 Mueller Industries, Inc. 425 9,908 Nacco Industries, Inc. 4 152 Nordson Corp. 200 5,738 NS Group, Inc.* 95 812 Oshkosh Truck Corp. 180 7,403
Shares Value ------ ----- Machinery - continued Presstek, Inc.* 200 $3,150 Regal Beloit Corp. 135 2,261 Reliance Steel & Aluminum Co. 560 13,300 Robbins & Myers, Inc. 100 2,419 Rogers Corp.* 98 3,504 Roper Industries 300 10,500 Semitool, Inc. 94 1,228 Specialty Equipment Cos., Inc.* 100 3,031 SPS Technologies, Inc.* 100 5,163 Stewart & Stevenson Svcs., Inc. 200 4,800 Tennant Co. 100 4,350 Terex Corp.* 200 2,463 Thomas Industries, Inc. 100 2,100 Timken Co. 400 5,625 Trinity Industries, Inc. 400 9,625 USEC, Inc. 800 4,100 Valence Technology, Inc.* 200 2,788 Wabash National Corp. 248 1,984 Watts Industriew, Inc. 108 1,208 Woodward Governor Co. 100 4,478 ------------ 249,272 Marine - 0.23% Alexander & Baldwin, Inc. 400 9,975 Kirby Corp.* 200 3,688 Overseas Shipholding Group, Inc. 200 4,800 ------------ 18,463 Media - 1.96% 24/7 Media, Inc.* 321 1,665 Ackerley Communications, Inc. 100 1,038 Acme Communications, Inc.* 57 349 ACNielson Corp.* 333 7,971 ACTV, Inc.* 331 3,258 Advo, Inc.* 100 3,681 APAC Teleservices, Inc.* 147 790 Citadel Communications Corp.* 246 2,983 Crown Media Holdings, Inc.* 37 513 Cumulus Media, Inc.* 300 1,875 Data Broadcasting* 460 2,027 Digital Impact, Inc.* 49 266 Gaylord Entertainment Co. 100 2,375 Grey Global Group, Inc. 2 1,120 Ha-Lo Industries, Inc.* 367 1,422 Hollinger International, Inc. 162 2,501 Houghton Mifflin Co. 152 5,596 Information Holdings, Inc.* 59 1,538 Insight Communications, Inc.* 234 3,247 Journal Register Co.* 400 7,125 Jupiter Media Metrix, Inc.* 219 2,984 Key3media Group, Inc.* 100 950 Lee Enterprises, Inc. 400 11,050 Lifeminders, Inc.* 80 930 Lodgenet Entertainment Corp.* 102 1,791
The accompanying notes are an integral part of the financial statements. 71 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Media - continued Martha Stewart Living, Inc.* 53 $1,328 McClatchy Co. 117 4,446 Media General, Inc. 73 2,774 Mediacom Communications Corp.* 126 2,142 Mediaplex, Inc.* 83 179 Meredith Corp. 197 6,255 Modem Media, Inc.* 200 1,175 Mypoints.com, Inc.* 126 284 Netcreations, Inc.* 16 120 Netratings, Inc.* 20 360 Nucentrix Broadband Networks* 43 973 On Command Corp.* 100 1,050 Paxson Communications Corp.* 300 3,413 Penton Media, Inc. 137 4,187 Playboy Enterprises, Inc.* 128 1,656 Private Media Group, Inc.* 70 606 Pulitzer, Inc. 48 1,966 Regent Communications, Inc.* 68 408 RH Donnelley Corp.* 300 6,788 Saga Communications* 100 1,650 Salem Communications Corp.* 133 1,596 Scholastic Corp.* 100 8,000 Sinclair Broadcast Group, Inc.* 375 3,457 Sirius Satellite Radio, Inc.* 223 11,206 Spanish Broadcasting Sys., Inc.* 409 3,681 Tivo, Inc.* 89 1,163 Ventiv Health, Inc.* 67 720 Wiley, John & Son 521 10,648 World Wrestling Fedn. Enmt., Inc.* 17 257 Xm Satellite Radio Hldgs., Inc.* 62 1,798 Young Broadcasting, Inc.* 100 2,481 ------------ 155,810 Metals & Mining - 1.09% Ak Steel Corp. 456 4,218 Aperian, Inc.* 64 224 Arch Coal, Inc. 208 2,262 Battle Mountain Gold Co.* 1,045 1,437 Bethlehem Steel Corp* 1,000 2,875 Brush Engineered Materials, Inc. 105 2,146 Carpenter Technology Corp. 100 3,100 Century Aluminum Co. 68 595 Cleveland Cliffs, Inc. 100 2,063 Commercial Metals Co. 100 2,725 Consol Energy, Inc. 100 1,694 Freeport McMoran Copper & Gold* 975 7,739 Gibraltor Steel Corp. 200 2,513 Kaiser Aluminum Corp.* 300 1,519 LTV Corp. 800 950 Metals USA, Inc. 900 2,531 National Steel Corp. 130 382 Quanex Corp. 100 1,981 RTI Intl. Metals, Inc.* 100 1,450
Shares Value ------ ----- Metals & Mining - continued Ryerson Tull, Inc. 146 $1,095 Shaw Group, Inc.* 73 5,950 Southern Peru Copper Corp. 200 2,788 Steel Dynamics, Inc.* 730 8,760 Stillwater Mining Co.* 520 15,080 UCAR International, Inc.* 400 3,300 Weirton Steel Corp.* 123 292 Wolverine Tube, Inc.* 100 1,363 Worthington Inds., Inc. 600 5,738 ------------ 86,767 Multi-Utilities - 0.31% Avista Corp. 337 7,561 Northwestern Corp. 100 2,213 Sierra Pacific Resources 588 10,106 Western Resources, Inc. 240 5,130 ------------ 25,010 Multiline Retail - 0.67% 99 Cents Only Stores* 100 2,244 Ames Dept. Stores, Inc.* 300 1,181 Buckle, Inc.* 100 1,681 Burlington Coat Factory Whse. 117 1,843 Central Garden & Pet Co.* 131 1,040 Chico's FAS, Inc.* 160 5,180 Childrens Place Retail Stores, Inc.* 170 4,409 Coldwater Creek, Inc.* 9 267 Dillards, Inc. 666 6,993 Electronics Boutique Corp.* 17 266 Factory 2 U, Inc.* 100 3,194 Freds, Inc. 45 951 Genesco, Inc.* 146 2,592 Hanover Direct, Inc.* 1,136 639 Intertan, Inc.* 200 2,213 PC Connection, Inc.* 71 1,936 Procurenet, Inc.* 300 0 Shopko Stores, Inc.* 300 1,913 Spiegel, Inc. 105 728 Stein Mart, Inc.* 200 3,100 Too, Inc.* 199 4,565 Tuesday Morning Corp.* 100 438 Tweeter Home Entmt. Group, Inc.* 110 2,647 United Auto Group, Inc.* 198 1,584 Value City Dept Stores, Inc.* 100 813 Whitehall Jewellers, Inc.* 100 800 ------------ 53,214 Office Electronics - 0.16% Ikon Office Solutions, Inc. 1,094 3,556 Zebra Technologies Corp.* 200 8,763 ------------ 12,318 Oil & Gas - 2.20% Barrett Resources Corp.* 300 10,913 Basin Exploration, Inc.* 350 6,934 Belco Oil & Gas Corp.* 100 913
The accompanying notes are an integral part of the financial statements. 72 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Oil & Gas - continued Berry Pete Co. 100 $1,719 Brown, Tom Inc.* 300 6,863 Cabot Oil & Gas Corp. 148 2,905 Chesapeake Energy Corp.* 1,120 6,300 Cross Timbers Oil Co. 622 11,701 EEX Corp.* 333 1,561 Evergreen Resources* 100 2,750 Forcenergy, Inc.* 74 1,610 Forest Oil Corp.* 310 4,282 Grey Wolf, Inc.* 1,400 6,475 H S Resources, Inc.* 108 3,362 Houston Exploration Co.* 100 2,250 Key Production, Inc.* 220 4,840 Louis Dreyfus Nat. Gas Corp.* 126 4,040 McMoran Exploration Co.* 440 5,258 Meridian Resource Corp.* 840 5,828 Mitchell Energy & Dev. Corp. 100 4,600 Nuevo Energy Co.* 100 1,813 Patina Oil & Gas Corp. 5 88 Pennzoil Quaker State Co. 600 7,050 Pioneer Nat. Res. Co.* 800 10,450 Plains Resources, Inc.* 103 1,970 Pogo Producing Co. 400 10,000 Prize Energy Corp.* 190 3,183 St Mary Land & Expl. Co. 200 4,688 Stone Energy Corp.* 100 5,120 Swift Energy Co.* 100 3,250 Syntroleum Corp.* 200 3,900 Tesoro Pete Corp.* 309 3,206 Trico Marine Svcs., Inc.* 97 1,613 Unit Corp.* 8 107 Universal Compression Hldgs.* 519 14,986 Vintage Pete, Inc. 400 8,450 ------------ 174,972 Paper & Forest Products - 0.41% Buckeye Technologies, Inc.* 200 3,425 Deltic Timber Corp. 100 1,944 Glatfelter, P H Co. 200 2,088 Louisiana-Pacific Corp. 690 5,865 Pope & Talbot, Inc. 70 1,089 Potlatch Corp. 200 6,700 Rayonier, Inc. 200 7,038 Rock-Tenn Company 100 894 Wausau Mosinee Paper Corp. 432 3,780 ------------ 32,822 Personal Products - 0.20% Alberto Culver Co. 147 4,934 Carter Wallace, Inc. 100 2,744 NBTY, Inc. 500 3,250 Nu Skin Enterprises, Inc.* 272 1,479 Perrigo Co.* 500 3,313 ------------ 15,719
Shares Value ------ ----- Pharmaceuticals - 2.63% Alpharma, Inc. 174 $6,753 Amylin Pharmaceuticals, Inc.* 397 4,020 Aphton Corp.* 91 2,730 Ariad Pharmaceuticals, Inc.* 154 1,405 Barr Labs, Inc.* 150 9,469 Bone Care Intl., Inc.* 23 566 Cell Pathways, Inc.* 137 1,045 Cell Therapeutics, Inc.* 178 11,907 Columbia Labs, Inc.* 298 1,825 Coulter Pharmaceutical, Inc.* 117 4,483 Cubist Pharmaceuticals, Inc.* 193 8,293 Cytogen Corp.* 524 3,013 Diversa Corp.* 41 1,043 Dura Pharmaceuticals, Inc.* 400 13,775 Dusa Pharmaceuticals, Inc.* 86 2,247 Emisphere Technologies, Inc.* 99 2,506 Guilford Pharmaceuticals, Inc.* 148 3,654 Immunogen, Inc.* 219 7,528 Intermune Pharmaceuticals, Inc.* 36 1,800 Intrabiotics Pharmaceuticals* 42 625 Isis Pharmaceuticals* 300 3,094 K V Pharmaceutical Co.* 150 5,850 KOS Pharmaceuticals, Inc.* 34 674 Ligand Pharmaceuticals, Inc.* 400 5,950 Martek Biosciences Corp.* 165 3,548 Matrix Pharmaceuticals* 141 2,027 Medicis Pharmaceutical Corp.* 265 19,511 MGI Pharma, Inc.* 112 3,136 Miravant Med. Technologies* 91 1,376 NPS Pharmaceuticals, Inc.* 132 5,660 OSI Pharmaceuticals, Inc.* 170 12,240 Pharmacyclics, Inc.* 209 11,247 Praecis Pharmaceuticals, Inc.* 42 1,066 Sciclone Pharmaceuticals, Inc.* 702 5,660 Sequenom, Inc.* 33 1,068 Sicor, Inc.* 586 7,508 Supergen, Inc.* 380 4,893 Titan Pharmaceuticals, Inc.* 164 6,901 Triangle Pharmaceuticals, Inc.* 300 2,522 Trimeris, Inc.* 114 8,066 Tularik, Inc.* 64 2,032 Twinlab Corps* 100 525 United Therapeutics Corp.* 90 4,815 Vivus* 174 566 Watson Pharmaceuticals, Inc.* 3 188 ------------ 208,805 Real Estate - 5.93% Alexandria Real Estate 100 3,388 Amerco* 100 2,025 American Industrial Prop. 158 1,955 Amli Residential Properties 100 2,313 Arden Realty, Inc. 206 4,944
The accompanying notes are an integral part of the financial statements. 73 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Real Estate - continued Avis Group Holdings, Inc.* 142 $4,242 Bedford Property Investors 114 2,244 Boykin Lodging Co. 127 1,151 Brandywine Realty 327 6,254 BRE Properties, Inc. 400 12,650 Burnham Pacific Ppty, Inc. 300 1,631 Cabot Industrial Trust 400 7,550 Camden Property Trust 400 11,450 Capital Automotive Reit 125 1,611 Catellus Dev. Corp.* 973 17,696 CB Richard Ellis, Inc.* 100 1,250 CBL & Assoc Properties, Inc. 146 3,376 Centerpoint Properties Trust 133 5,910 Chateau Communities, Inc. 100 2,813 Chelsea GCA Realty, Inc. 102 3,290 Colonial Properties Trust 200 4,913 Commercial Net Lease Rlty, Inc. 339 3,432 Corrections Corp. of America* 879 714 Cornerstone Realty Income Tr., Inc. 405 4,253 Cousins Properties, Inc. 300 7,800 Crestline Cap. Corp.* 100 2,088 Developers Diversified Realty 500 5,969 Dollar Thrifty Automotive Grp.* 200 3,075 Eastgroup Properties, Inc. 103 2,099 Electro Rent Corp.* 100 1,369 Entertainment Pptys. Trust 122 1,350 Equity Inns, Inc. 315 1,949 Essex Property Trust 100 5,200 Fairfield Communities, Inc. 400 5,075 Federal Realty Invt. Tr. 400 7,700 Felcor Lodging Tr., Inc. 127 2,786 First Industrial Realty Trust 300 9,263 First Washington Realty Trust 100 2,525 Forest City Enterprises, Inc. 102 3,774 Franchise Finance Corp. of Amer. 230 4,672 Gables Residential Trust 200 5,100 Glenborough Realty Trust 300 4,819 Glimcher Realty Trust 200 2,600 Great Lakes Reit, Inc. 113 1,914 Health Care Property Invs., Inc. 456 13,395 Health Care Reit, Inc. 300 5,306 Healthcare Realty Trust 400 7,975 Highwoods Properties, Inc. 205 4,433 Home Properties N Y, Inc. 100 2,719 Hospitality Properties Trust 400 8,625 HRPT Properties Trust 719 4,629 Indymac Bancorp, Inc.* 600 12,525 Innkeepers USA Trust 300 3,056 Insignia Financial Group, Inc.* 100 969 Interpool, Inc. 100 1,288 IRT Property Co. 313 2,563 JDN Realty Corp. 319 3,489 Jones Lang Lasalle, Inc.* 300 3,825
Shares Value ------ ----- Real Estate - continued JP Realty, Inc. 100 $1,600 Kilroy Realty Corp 200 5,213 Koger Equity, Inc. 200 3,188 Lasalle Hotel Peroperties 100 1,438 Lexington Corp. Property Trust 134 1,499 LNR Property Corp 200 4,325 Macerich Co. 300 5,888 Manufactured Home Cmntys., Inc. 130 3,234 McGrath Rentcorp 100 1,725 Meditrust* 967 2,659 Meristar Hospitality Corp. 408 7,803 Mid Amer Apt Cmntys., Inc. 119 2,618 Mills Corp. 100 1,706 National Golf Properties, Inc. 100 1,988 National Health Invs., Inc. 200 1,250 Nationsrent, Inc.* 400 900 Nationwide Health Properties, Inc. 400 5,975 New Plan Excel Realty Trust 364 4,482 Pacific Gulf Properties, Inc. 100 2,656 Pan Pac Retail Properties, Inc. 100 2,044 Parkway Properties, Inc. 100 2,863 Pennsylvania Real Estate Invt. 100 1,719 Prentiss Properties Trust 300 7,613 Prime Group Realty Trust 100 1,488 PS Business Pks., Inc. 200 5,250 Realty Income Corp. 200 4,600 Reckson Assocs. Realty Corp. 400 9,050 Regency Realty Corp. 300 6,750 Rent A Center, Inc.* 113 3,298 Rent Way, Inc.* 159 805 RFS Hotel Investments, Inc. 200 2,575 Saul Centers, Inc. 100 1,531 Security Cap. Group, Inc.* 400 7,625 Senior Housing Property Trust 68 633 Shurgard Storage Ctrs., Inc. 300 6,806 SL Green Realty Corp. 140 3,754 Smith, Charles E Residential 127 5,588 Sovran Self Storage, Inc. 118 2,227 Storage USA, Inc. 200 5,588 Summit Properties, Inc. 147 3,528 Sun Communities, Inc. 100 3,038 Taubman Centers, Inc. 300 3,281 Town & Country Trust 100 1,850 Trammell Crow Co.* 200 2,675 United Dominion Rlty. Trust, Inc. 900 9,450 United Rentals, Inc.* 197 4,236 Urban Shopping Centers, Inc. 100 4,794 Ventas, Inc. 500 2,500 Washington Real Estate Invt. Tr. 300 6,000 Webb, Del Corp.* 100 2,688 Weingarten Realty Invs. 200 8,388 Western Properties Trust 132 1,675
The accompanying notes are an integral part of the financial statements. 74 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Real Estate - continued Westfield America, Inc. 300 $4,200 Xtra Corp.* 100 4,550 ------------ 471,776 Road & Rail - 0.66% American Freightways Corp.* 140 2,258 Arkansas Best Corp.* 26 416 Arnold Industries, Inc. 122 2,143 Heartland Express, Inc.* 112 1,946 Hunt, J B Trans Svcs., Inc. 138 1,803 Knight Transportation, Inc.* 43 683 Landstar Systems, Inc.* 100 4,725 M S Carriers, Inc.* 100 1,563 Roadway Express, Inc. 100 2,056 Rollins Truck Leasing Corp. 401 2,105 Ryder Systems, Inc. 294 5,807 Swift Transportation, Inc.* 350 4,988 US Freightways Corp. 200 5,150 Wabtec 399 4,040 Werner Enterprises, Inc. 300 4,200 Wisconsin Cent. Transn. Corp.* 400 5,125 Yellow Corp.* 200 3,600 ------------ 52,605 Semiconductor Equipment & Products - 2.22% Actel Corp.* 127 4,651 ADE Corp.* 45 804 Alliance Semiconductor Corp.* 200 4,000 Applied Science & Tech., Inc.* 47 676 Atmi, Inc.* 281 5,304 Axt, Inc.* 110 4,235 Brooks Automation, Inc.* 121 3,207 C Cube Microsystems, Inc.* 400 7,800 Cirrus Logic, Inc.* 523 22,554 Cymer, Inc.* 271 6,775 Dupont Photomasks, Inc.* 4 225 Elantec Semiconductor, Inc.* 131 14,574 Electroglas, Inc.* 129 1,814 Emcore Corp.* 200 8,200 ESS Technology, Inc.* 200 3,100 FEI Co.* 97 2,298 FSI Intl., Inc.* 200 1,863 Gasonics Intl. Corp.* 84 1,717 General Semiconductor, Inc.* 300 3,431 Genrad, Inc.* 200 1,825 Helix Technology Corp. 150 4,181 Ibis Technology Corp.* 48 1,818 Integrated Circuit Systems, Inc.* 30 409 Integrated Silicon Solution* 240 3,210 Kulicke & Soffa Inds., Inc.* 400 5,875 LTX Corp.* 400 5,600 Microsemi Corp.* 42 1,680 Netsilicon, Inc.* 32 454 Oak Technology* 239 6,707
Shares Value ------ ----- Semiconductor Equipment & Products - continued Pericom Semiconductor Corp.* 114 $3,021 Photronics, Inc.* 139 3,136 PRI Automation, Inc.* 136 3,077 S3, Inc. 700 6,322 Silicon Image, Inc.* 314 3,690 Silicon Valley Group, Inc.* 315 10,375 Smartdisk Corp.* 37 190 SpeedFam-Ipec, Inc.* 200 1,900 Telcom Semiconductor, Inc.* 107 1,505 Ultratech Stepper, Inc.* 138 3,243 Varian Semiconductor Equip., Inc.* 276 6,348 White Electr. Designs Corp.* 13 124 Zoran Corp.* 92 4,612 ------------ 176,527 Software - 6.56% Actuate Corp.* 626 17,645 Adept Technology, Inc.* 52 1,450 Agency.com Ltd.* 12 126 Allaire Corp.* 165 1,207 AnswerThink Consulting Group* 216 3,537 AppliedTheory Corp.* 40 190 Aremissoft Corp.* 57 2,437 Ask Jeeves, Inc.* 144 1,872 Aspen Technology, Inc.* 200 8,263 Avant Corp.* 349 5,868 AVT Corp.* 200 1,256 Axent Technologies, Inc.* 300 5,756 Barra, Inc.* 100 6,113 Be Free, Inc.* 156 614 Bindview Dev. Corp.* 300 2,344 Black Box Corp.* 128 8,432 Bottomline Technologies, Inc.* 52 1,823 Breakaway Solutions, Inc.* 54 311 Broadbase Software, Inc.* 232 2,494 Bsquare Corp.* 53 828 CACI, Inc.* 100 2,063 Caldera Systems, Inc.* 28 98 Calico Commerce, Inc.* 185 567 Caminus Corp.* 14 441 Carreker Corp.* 24 444 Cerner Corp.* 200 12,388 Chordiant Software, Inc.* 20 122 Clarent Corp.* 145 4,504 Clarus Corp.* 96 960 Click2learn.com, Inc.* 92 1,334 Cognizant Technology Solutions* 31 1,271 Concord Communications, Inc.* 109 845 Convergent Communications, Inc.* 168 714 Corillian Corp.* 11 157 Corsair Communications, Inc.* 120 728 Cysive, Inc.* 2 16 Daleen Technologies, Inc.* 155 1,545
The accompanying notes are an integral part of the financial statements. 75 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Software - continued Data Return Corp.* 77 $886 Datastream Systems, Inc.* 106 1,299 Dendrite Intl., Inc.* 300 6,525 Digimarc Corp.* 53 792 Digital Courier Technologies* 244 709 Digital Insight Corp.* 170 3,283 Digital River, Inc.* 316 2,064 Digitas, Inc.* 50 597 Documentum, Inc.* 113 9,605 Dset Corp.* 57 324 DSL Net, Inc.* 481 1,263 Ebenx, Inc.* 22 263 Edwards, J D & Co.* 356 9,212 Embarcadero Tech., Inc.* 14 846 Emerge Interactive, Inc.* 33 369 Epresence, Inc.* 200 1,413 Eprise Corp.* 19 57 Excalibur Technologies Corp.* 100 5,888 Exchange Applications, Inc.* 200 641 Extensity, Inc.* 19 242 F5 Networks, Inc.* 125 3,875 Fair, Issac & Co., Inc. 100 4,100 Filenet Corp.* 309 8,189 Firepond, Inc.* 26 208 Forrester Research, Inc.* 69 2,833 Gartner Group, Inc.* 537 5,102 Geoworks* 68 334 Gerber Scientific, Inc. 135 1,080 Goto.com, Inc.* 181 2,568 Great Plains Software, Inc.* 100 3,894 GRIC Communications, Inc.* 22 110 High Speed Access Corp.* 385 1,131 HNC Software, Inc. 200 4,063 Hotjobs.com Ltd.* 91 1,422 Hyperion Solutions Corp.* 300 4,200 Igate Cap. Corp.* 378 1,914 Imation Corp.* 335 6,637 IMR Global Corp. 126 1,040 Indus Intl., Inc.* 71 288 Informatica Corp. 178 16,821 Information Architects Corp.* 424 1,590 Inprise Corp.* 359 2,289 Intelidata Technologies Corp.* 268 1,432 Interact Comm. Corp.* 189 1,736 Interactive Intelligence, Inc.* 29 1,059 Interliant, Inc.* 441 2,646 Internet.com Corp.* 72 1,499 Internet Pictures Corp.* 355 760 Intertrust Technologies Corp.* 468 4,680 Intervoice, Inc.* 307 3,003 Interworld Corp.* 133 291 Interwoven, Inc.* 256 25,792 Intranet Solutions, Inc.* 115 5,348
Shares Value ------ ----- Software - continued Intraware, Inc.* 104 $761 Intrusion.com, Inc.* 97 994 IXL Enterprises, Inc.* 506 1,297 JDA Software Group, Inc.* 142 2,139 Keynote Systems, Inc.* 116 2,784 Kronos, Inc.* 100 3,644 Legato Systems, Inc.* 657 5,851 Level 8 Systems, Inc.* 182 1,752 Liveperson, Inc.* 50 116 Looksmart, Ltd.* 301 2,126 Loudeye Technologies, Inc.* 24 92 Mail.com, Inc.* 668 2,171 Manhattan Assocs., Inc.* 18 1,152 Manugistics Group, Inc.* 163 18,572 MapInfo Corp.* 85 2,778 MatrixOne, Inc.* 35 1,039 Mcafee.com Corp.* 30 206 MCSI, Inc.* 100 2,875 Medicalogic, Inc.* 51 207 Mentor Graphics Corp.* 500 11,719 Mercator Software, Inc.* 181 826 Mercury Computer Systems, Inc.* 125 3,875 Metacreations Corp.* 142 1,420 Metasolv Software, Inc.* 59 734 Micros Systems, Inc.* 100 1,975 Microstrategy, Inc.* 237 5,673 Mp3.com, Inc.* 233 823 National Information Consortm.* 74 250 Natural Microsystems Corp.* 232 10,484 Neoforma.com, Inc.* 27 46 Neon Systems, Inc.* 21 148 Net Genesis Corp.* 26 91 Netguru.com, Inc.* 20 100 Netiq* 173 14,900 Netscout Systems, Inc.* 76 1,420 Netsol Intl., Inc.* 21 186 Netzero, Inc.* 339 498 New Era Of Networks, Inc.* 335 5,213 Nhancement Technologies, Inc.* 45 1,136 Niku Corporation* 54 851 Novadigm, Inc.* 68 680 Nuance Communications* 31 2,674 Numerical Technologies, Inc.* 27 554 Nyfix, Inc.* 158 6,241 Objective Sys. Integrators, Inc.* 141 1,269 Onyx Software Corp.* 240 3,810 Opus360 Corp.* 240 390 OTG Software, Inc.* 33 1,040 PC-Tel, Inc.* 74 1,277 Persistence Software, Inc.* 73 858 Phoenix Technology Ltd.* 200 3,213 Predictive Systems, Inc.* 16 222 Primus Knowledge Solutions, Inc.* 89 723
The accompanying notes are an integral part of the financial statements. 76 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Software - continued Progress Software Corp.* 300 $4,744 Project Software & Dev., Inc.* 100 1,300 Puma Technology, Inc.* 232 3,147 Purchasepro.com, Inc.* 130 3,510 QRS Corp.* 100 844 Quintus Corp.* 117 874 Quokka Sports, Inc.* 123 377 Radiant Systems, Inc.* 150 2,766 Radisys Corp.* 100 2,650 Ramp Networks, Inc.* 95 178 Razorfish, Inc* 100 450 Register.com, Inc.* 28 196 Remedy Corp.* 200 3,425 Retek, Inc.* 277 10,924 Saba Software, Inc.* 421 9,867 Saga Systems, Inc.* 300 1,613 Sagent Technology, Inc.* 300 769 Sanchez Computer Assoc., Inc.* 100 1,606 Scientific Learning Corp.* 80 448 Sciquest.com, Inc.* 121 541 Seachange Intl., Inc.* 117 2,574 Secure Computing Corp.* 172 3,956 Selectica, Inc.* 28 739 Serena Software, Inc.* 150 7,631 Silverstream Software, Inc.* 77 1,733 Simione Cent. Hldgs., Inc.* 3 10 Smartserv Online, Inc.* 28 543 Sonic Foundry, Inc.* 266 1,696 SPSS, Inc.* 100 2,250 Starbase Corp.* 718 3,657 Structural Dynamics Res. Corp.* 331 3,413 SVI Holdings, Inc.* 200 908 Syntel, Inc.* 33 311 Systems & Computer Technology* 308 4,447 THQ, Inc.* 150 3,075 Tenfold Corp.* 87 375 Transaction Sys. Architects, Inc.* 311 4,199 Tricord Systems, Inc.* 121 1,997 Trizetto Group, Inc.* 77 1,540 Tumbleweed Communications Corp.* 62 1,062 Unify Corp.* 59 30 US Interactive, Inc.* 192 192 Verity, Inc.* 259 6,087 Versat, Inc.* 24 396 Vertel Corp.* 195 1,036 Vertex Industries, Inc.* 49 735 Viador, Inc.* 277 1,281 Vialink Co.* 103 740 Viant Corp.* 482 2,862 Vicinity Corp.* 45 473 Visual Networks, Inc.* 200 738 Websense, Inc.* 168 3,024
Shares Value ------ ----- Software - continued Webtrends Corp.* 100 $3,214 Xpedior, Inc.* 45 84 ------------ 522,066 Specialty Retail - 2.36% Aaron Rents, Inc. 100 1,675 Abercrombie & Fitch Co.* 673 15,858 American Eagle Outfitters, Inc.* 132 4,546 Anntaylor Stores Corp.* 169 5,070 Barnes & Noble, Inc.* 328 6,191 Borders Group, Inc.* 600 8,325 Cato Corp. 100 1,200 Charming Shoppes, Inc.* 800 4,900 Claire S Stores, Inc. 249 5,011 Copart, Inc.* 300 4,519 Cost Plus, Inc.* 150 4,200 CSK Auto Corp.* 182 637 Dress Barn, Inc.* 101 2,531 Footstar, Inc. 126 4,520 Group 1 Automotive, Inc.* 230 2,286 Guitar Center, Inc.* 142 1,882 Handleman Co.* 200 1,975 Hollywood Entmt. Corp.* 390 1,194 Hot Topic, Inc.* 146 5,001 Hughes Supply, Inc. 200 3,750 Linens 'N Things, Inc.* 348 10,701 Mens Wearhouse, Inc.* 291 8,512 Michaels Stores, Inc.* 200 4,863 O Reilly Automotive, Inc.* 300 5,400 Office Max, Inc.* 900 2,588 Pacific Sunwear of Calif.* 305 6,253 Payless Shoesource, Inc.* 128 7,416 Pep Boys-Manny Moe & Jack 400 1,800 Petsmart, Inc.* 900 3,994 Pier 1 Imports, Inc. 800 10,600 Regis Corp. 250 3,781 School Specialty, Inc.* 106 1,630 Sonic Automotive, Inc.* 523 4,674 Sunglass Hut Intl., Inc.* 400 3,100 Trans World Entmt. Corp.* 309 2,627 Ultimate Electronics, Inc.* 49 1,770 Venator Group. Inc.* 1,019 14,393 Wilsons Leather Experts, Inc.* 53 812 Zale Corp.* 229 7,757 ------------ 187,939 Textiles & Apparel - 0.97% Brown Shoe, Inc. 118 1,158 Bush Industries, Inc. 100 1,163 Cole, Kenneth Prodtns., Inc.* 80 3,635 Columbia Sportswear Co.* 100 4,275 Fossil, Inc.* 100 1,306 Guess, Inc.* 47 350 Haverty Furniture Cos., Inc. 116 1,305
The accompanying notes are an integral part of the financial statements. 77 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Textiles & Apparel - continued Kellwood Co. 200 $3,888 Madden, Steven Ltd.* 200 1,906 Nautica Enterprises, Inc.* 301 3,800 Oshkosh B Gosh, Inc. 100 1,600 Phillips Van Heusen Corp. 115 1,366 Polo Ralph Lauren Corp.* 327 6,417 Polymer Group, Inc. 100 613 Quiksilver, Inc.* 230 4,399 Reebok Intl., Ltd.* 400 8,625 Russell Corp. 200 3,200 Skechers USA, Inc.* 54 820 Stride Rite Corp. 400 2,150 Timberland Co.* 200 10,325 Unifi, Inc.* 500 4,344 Vans, Inc.* 34 440 Warnaco Group, Inc. 290 761 Wellman, Inc. 319 4,785 Wolverine World Wide, Inc. 400 4,325 ------------ 76,954 Tobacco - 0.16% Schweitzer Mauduit Intl., Inc. 100 1,619 Star Scientific, Inc.* 200 794 Universal Corp. 300 8,400 Vector Group Ltd. 119 1,659 ------------ 12,471 Water Utilities - 0.31% American States Water Co. 100 3,119 California Water Service Grp. 100 2,694 Etown Corp. 100 6,738 Philadelphia Suburban Corp.* 500 11,720 ------------ 24,270 Wireless Telecommunication Service - 0.11% Advanced Radio Telecom. Corp.* 200 788 AirGate PCS, Inc.* 64 2,488 Rural Celluar Corp.* 54 2,903 Terremark Worldwide, Inc.* 875 2,302 ------------ 8,480 TOTAL COMMON STOCKS (Cost $7,570,102) $7,082,460 ------------ PREFERRED STOCKS - 0.01% Corrections Corporation of America Series B, 12% (Cost $774) 43 $699 ------------ WARRANTS - 0.00% Endo Pharmaceutical Holdings, Exp. 12/31/02 (Cost $635) 100 $62 ------------
Principal Value --------- ----- U.S. TREASURY OBLIGATIONS - SHORT TERM - 1.19% U.S. Treasury Bills - 00% 6.07% due 12/21/00 $25,000 $24,789 5.90% due 12/07/00 20,000 19,951 5.99% due 12/07/00 50,000 49,700 ------------ TOTAL U.S. TREASURY OBLIGATIONS - SHORT TERM (Cost $94,440) $94,440 ------------ REPURCHASE AGREEMENTS - 9.75% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $776,136 on 11/01/00, collateralized by $745,000 U.S. Treasury Notes, 7.00% due 07/15/06 (valued at $816,352, including interest) (Cost $776,000) 776,000 $776,000 ------------ TOTAL INVESTMENTS (Small Cap Index Fund) (Cost $8,441,951) $7,953,661 ------------ - ------------------------------------------------------------------------------ Socially Responsible Fund - ------------------------------------------------------------------------------ Shares Value ------ ----- COMMON STOCKS - 79.74% Airlines - 0.37% AMR Corp. 760 $24,890 Delta Air Lines, Inc. 380 17,955 ------------ 42,845 Auto Components - 0.01% Superior Industries Intl., Inc. 50 1,703 ------------ Automobiles - 0.04% Harley-Davidson, Inc. 100 4,819 ------------ Banks - 5.00% Bank America Corp. 1,600 76,900 Bank of New York, Inc. 1,000 57,563 Chase Manhattan Corp. 2,295 104,423 Firstar Corp. 450 8,859 Fleetboston Financial Corp. 1,420 53,960 Greenpoint Financial Corp. 400 11,900 Mellon Financial Corp. 750 36,188 Morgan J P & Co Inc 440 72,820 Northern Trust Corp 150 12,806 PNC Finl Services Group, Inc. 650 43,469 Suntrust Banks, Inc. 450 21,966 Washington Mutual, Inc. 450 19,800 Wells Fargo & Co. 1,300 60,206 ------------ 580,859 Beverages - 1.44% Coca Cola Co. 2,000 120,750 Pepsico, Inc. 960 46,500 ------------ 167,250
The accompanying notes are an integral part of the financial statements. 78 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Biotechnology - 0.42% Amgen, Inc.* 850 $49,247 ------------ Chemicals - 0.24% Albemarle Corp. 200 4,638 Grace, W R & Co.* 800 3,050 Lubrizol Corp. 250 5,422 Praxair, Inc. 150 5,588 Sigma Aldrich 250 8,938 ------------ 27,634 Commercial Services & Supplies - 1.84% Automatic Data Processing, Inc. 800 52,250 Avery Dennison Corp. 250 12,625 Deluxe Corp. 1,400 31,588 Dun And Bradstreet Corp.* 400 8,650 Ecolab, Inc. 300 11,756 First Data Corp. 770 38,596 IMS Health, Inc. 800 18,900 Paychex, Inc. 375 21,258 Pitney Bowes, Inc. 500 14,844 Viad Corp 150 3,206 ------------ 213,673 Communications Equipment - 4.63% Avaya, Inc.* 200 2,688 Cisco Systems, Inc.* 4,600 247,825 Corning, Inc. 900 68,850 JDS Uniphase Corp.* 700 56,963 Juniper Networks, Inc.* 50 9,750 Lucent Technologies, Inc. 2,410 56,183 Motorola, Inc. 1,800 44,888 Qualcomm, Inc.* 550 35,810 Tellabs, Inc.* 200 9,988 Turnstone Systems, Inc.* 200 4,250 ------------ 537,193 Computers & Peripherals - 5.82% Apple Computer* 540 10,564 Compaq Computer Corp. 1,300 39,533 Dell Computer Corp.* 1,450 42,775 E M C Corp.* 1,450 129,141 Gateway, Inc.* 200 10,322 Hewlett Packard Co. 1,700 78,944 International Business Machines 1,670 164,495 Lexmark International, Inc.* 150 6,150 Network Appliance, Inc.* 150 17,850 Palm, Inc.* 274 14,676 Seagate Technology* 410 28,649 Sun Microsystems, Inc.* 1,200 133,050 ------------ 676,148 Electric Utilities - 1.27% Allegheny Energy, Inc. 850 34,797 DPL, Inc. 1,171 33,227 Idacorp, Inc. 510 25,149 OGE Energy Corp. 650 13,366
Shares Value ------ ----- Electric Utilities - continued Potomac Electric Power Co. 550 $12,581 Puget Sound Energy, Inc. 1,150 28,247 ------------ 147,367 Electrical Equipment - 1.05% Cooper Industries, Inc. 660 25,245 Emerson Electric Co. 550 40,391 Molex, Inc. 312 16,848 Rockwell International Corp. 630 24,767 Sensormatic Electronics Corp.* 340 6,120 Vishay Intertechnology, Inc.* 275 8,250 ------------ 121,620 Electronic Equipment & Instruments - 0.46% Agilent Technologies, Inc.* 324 15,005 ABVX Corp. 1,000 28,625 Kemet Corp.* 200 5,575 Solectron Corp.* 100 4,400 ------------ 53,605 Energy Equipment & Services - 1.79% Baker Hughes, Inc. 900 30,938 Cooper Cameron Corp.* 200 10,900 Halliburton Co. 600 22,238 Helmerich & Payne, Inc. 1,100 34,581 Noble Drilling Corp.* 300 12,469 Rowan Companies, Inc.* 450 11,334 Schlumberger Ltd. 690 52,526 Tidewater, Inc. 530 24,479 Transocean Sedco Forex, Inc. 167 8,851 ------------ 208,316 Financial Services - 7.34% American Express Co. 1,410 84,600 Associates First Capital Corp. 750 27,844 Citigroup, Inc. 3,866 203,448 Edwards, A G, Inc. 150 7,613 Federal Home Loan Mortgage Corp 750 45,000 Federal National Mortgage Assn. 1,350 103,950 Household International, Inc. 1,150 57,859 Lehman Brothers Holdings, Inc. 920 59,340 MBNA Corp. 800 30,050 Merrill Lynch & Co., Inc. 1,280 89,600 Moody's Corp. 800 21,050 Morgan Stanley Dean Witter & Co. 1,000 80,313 Paine Webber Group, Inc. 360 25,650 Providian Financial Corp. 150 15,600 ------------ 851,916 Food & Drug Retailing - 0.39% Sysco Corp. 300 15,656 Walgreen Co. 650 29,656 ------------ 45,312 Food Products - 1.33% Campbell Soup Co. 570 16,673 Conagra, Inc. 1,600 34,200
The accompanying notes are an integral part of the financial statements. 79 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Food Products - continued Kellogg Co. 450 $11,419 Quaker Oats Co. 450 36,703 Ralston Purina Co. 1,190 28,858 Sara Lee Corp. 1,230 26,522 ------------ 154,374 Gas Utilities - 2.04% AGL Resources, Inc. 3,520 71,720 El Paso Energy Corp. 300 18,806 Equitable Resources, Inc 400 23,200 National Fuel Gas Co. 800 42,900 Oneok, Inc. 1,150 45,569 Peoples Energy Corp.* 1,000 34,375 ------------ 236,570 Health Care Equipment & Supplies - 0.79% Allergan, Inc. 400 33,625 Bausch & Lomb, Inc. 50 1,928 Medtronic, Inc. 600 32,588 PE Corp. 200 23,400 ------------ 91,541 Health Care Providers & Services - 2.32% Apria Healthcare Group, Inc.* 100 2,000 Cigna Corp. 1,100 134,145 HCA Healthcare Co. 1,310 52,318 Oxford Health Plans, Inc.* 250 8,438 Tenet Healthcare Corp. 1,010 39,706 UnitedHealth Group, Inc. 300 32,813 ------------ 269,419 Hotels, Restaurants & Leisure - 0.34% Carnival Corp. 450 11,166 Darden Restaurants, Inc. 800 18,000 Marriott International Inc. 250 10,125 ------------ 39,291 Household Durables - 0.27% Black & Decker Corp. 400 15,050 Stanley Works 630 16,774 ------------ 31,824 Household Products - 1.70% Colgate Palmolive Co. 550 32,318 Fort James Corp 100 3,294 Kimberly Clark Corp. 1,100 72,600 Procter & Gamble Co. 1,250 89,297 ------------ 197,509 Industrial Conglomerates - 0.66% Tyco International, Ltd. 1,346 76,301 ------------ Insurance - 3.30% Aflac, Inc. 250 18,266 Allstate Corp. 400 16,100 American Financial Group, Inc. 110 2,358 American International Group, Inc. 1,950 191,100 Chubb Corp. 150 12,666 Hartford Financial Services Group 320 23,820
Shares Value ------ ----- Insurance - continued Jefferson Pilot Corp. 240 $16,500 Lincoln National Corp. 1,000 48,375 Marsh & Mclennan Cos., Inc. 200 26,150 Torchmark, Inc. 850 28,316 ------------ 383,650 Internet Software & Services - 1.00% America Online, Inc.* 1,850 93,296 Yahoo, Inc.* 400 23,450 ------------ 116,746 I T Consulting Services - 0.65% Ceridian Corp.* 550 13,750 Computer Sciences Corp.* 100 6,300 Electronic Data Systems Corp. 1,180 55,386 ------------ 75,436 Leisure Equipment & Products - 0.01% Hasbro, Inc. 100 1,075 ------------ Machinery - 0.86% Caterpillar, Inc. 730 25,596 Deere & Co. 380 13,989 Dover Corp. 750 31,828 Harsco Corp. 590 11,911 Illinois Tool Works, Inc. 300 16,669 ------------ 99,992 Media - 4.12% Belo, A H Corp. 1,250 23,983 Clear Channel Communications* 700 42,044 Disney, Walt Co. 2,420 86,665 Dow Jones & Co., Inc. 960 56,520 Gannett, Inc. 710 41,180 Harte Hanks, Inc. 100 2,213 Interpublic Group Cos., Inc. 250 10,734 Knight Ridder, Inc. 450 22,613 McGraw-Hill Cos., Inc. 200 12,837 New York Times Co. 200 7,350 Omnicom Group 250 23,063 Time Warner, Inc. 1,000 75,910 Viacom, Inc.* 1,196 68,023 Young & Rubicam, Inc. 100 4,806 ------------ 477,941 Metals & Mining - 0.36% Alcan Aluminum Ltd. 1,320 41,663 ------------ Multiline Retail - 1.86% Sears Roebuck & Co. 1,260 37,460 Target Corp. 880 24,310 Wal Mart Stores, Inc. 3,400 154,275 ------------ 216,045 Oil & Gas - 0.42% Ashland, Inc. 1,490 48,798 ------------ Paper & Forest Products - 0.19% Rayonier, Inc. 640 22,520 ------------
The accompanying notes are an integral part of the financial statements. 80 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Personal Products - 0.40% Avon Products, Inc. 350 $16,975 Gillette Co. 850 29,644 ------------ 46,619 Pharmaceuticals - 7.65% Abbott Laboratories 2,210 116,716 Bristol Myers Squibb Co. 2,560 156,000 Ivax Corp.* 250 10,875 Johnson & Johnson 1,510 139,109 Lilly Eli & Co. 900 80,438 Merck & Co., Inc. 3,370 303,089 Schering Plough Corp. 1,590 82,183 ------------ 888,409 Real Estate - 0.05% Host Marriott Corp. 500 5,313 ------------ Road & Rail - 0.45% Burlington Northern 850 22,578 GATX 200 8,413 Union Pacific Corp. 450 21,094 ------------ 52,084 Semiconductor Equipment & Products - 4.15% Advanced Micro Devices, Inc.* 1,100 24,888 Altera Corp.* 150 6,141 Analog Devices, Inc.* 300 19,500 Applied Materials, Inc.* 550 29,219 Broadcom Corp.* 50 11,119 Conexant Systems, Inc.* 100 2,631 Integrated Device Technology* 150 8,447 Intel Corp. 4,500 202,500 KLA Tencor Corp.* 200 6,763 LSI Logic Corp.* 200 6,575 Micron Technology, Inc.* 1,100 38,225 National Semiconductor, Corp.* 700 18,200 Teradyne, Inc.* 500 15,625 Texas Instruments, Inc. 1,500 73,594 Xilinx, Inc.* 250 18,109 ------------ 481,534 Software - 4.80% Adobe Systems, Inc. 200 15,213 Art Technology Group, Inc.* 100 6,275 Commerce One, Inc.* 50 3,209 Computer Assoc. Intl., Inc. 500 15,938 Inktomi Corp.* 100 6,344 Liberate Technologies* 150 2,859 Microsoft Corp.* 3,880 267,235 Oracle Corp.* 4,200 138,600 Portal Software, Inc.* 50 1,759 Siebel Systems, Inc.* 100 10,494 Software.com, Inc.* 350 52,150 Sybase, Inc.* 400 8,375 Synavant, Inc.* 40 183 Veritas Software Corp.* 200 28,203 ------------ 556,836
Shares Value ------ ----- Specialty Retail - 1.10% Best Buy Co., Inc.* 150 $7,528 Home Depot, Inc. 1,800 77,400 Lowes Cos., Inc. 300 13,706 Radioshack Corp. 490 29,215 ------------ 127,850 Telecommunications - 6.35% Alltel Corp. 200 12,888 A T & T Corp. 3,367 78,072 Bellsouth Corp. 2,090 100,973 Global Crossing, Ltd.* 550 12,994 Nortel Networks Corp. 2,340 106,470 Qwest Communications Intl., Inc.* 841 40,894 SBC Communications, Inc. 2,650 152,872 Sprint Corp.* 1,500 38,250 Verizon Communications 2,422 140,022 Worldcom, Inc.* 2,250 53,438 ------------ 736,872 Wireless Telecommunications - 0.46% Nextel Communications, Inc.* 400 15,375 Sprint Corp.* 1,000 38,125 ------------ 53,500 TOTAL COMMON STOCKS (Cost $8,280,182) $9,259,219 ------------ COMMON STOCK UNIT - 0.74% Financial Services - 0.74% SPDR Trust (Cost $88,724) 600 $85,772 ------------ Principal Value --------- ----- U.S. TREASURY OBLIGATIONS-SHORT TERM - 1.42% U.S. Treasury Bills - 1.42% 5.90% due 11/16/00 $20,000 $19,951 5.94% due 11/02/00 65,000 64,989 5.97% due 11/02/00 10,000 9,998 5.99% due 12/01/00 10,000 9,940 6.02% due 12/07/00 50,000 49,699 6.07% due 12/14/00 10,000 9,928 ------------ TOTAL U.S. TREASURY OBLIGATIONS-SHORT TERM (Cost $164,505) $164,505 ------------ REPURCHASE AGREEMENT - 18.10% Repurchase Agreement with State Street Bank & Trust Company dated 10/31/00 at 6.42%, to be repurchased at $2,102,370 on 11/01/00, collateralized by $2,160,000 U.S. Treasury Notes, 5.875% due 09/30/02 (valued at $2,154,944, including interest) (Cost $2,102,000) $2,102,000 $2,102,000 ------------ TOTAL INVESTMENTS (Socially Responsible Fund) (Cost $10,635,411) $11,611,496 ------------
The accompanying notes are an integral part of the financial statements. 81 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Stock Index Fund - --------------------------------------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 87.80% Aerospace & Defense - 1.31% Boeing Co. 2,100 $142,406 General Dynamics Corp. 500 35,781 Goodrich B F Co. 200 8,188 Honeywell Intl Inc. 1,900 102,244 Lockheed Martin Corp. 1,050 37,643 Northrop Grumman Corp. 200 16,800 Raytheon Co. 800 27,350 United Technologies Corp. 1,100 76,794 ------------ 447,205 Air Freight & Couriers - 0.10% Fedex Corp.* 700 32,802 ------------ Airlines - 0.20% AMR Corp. 400 13,100 Delta Air Lines Inc. 300 14,175 Southwest Airls Co. 1,200 34,200 US Airways Group Inc.* 200 7,550 ------------ 69,025 Auto Components - 0.21% Cooper Tire and Rubber Co. 200 2,188 Dana Corp. 400 8,875 Delphi Automotive Sys Corp. 1,300 20,394 Goodyear Tire And Rubber 400 7,400 Johnson Controls Inc. 200 11,925 Snap On Inc. 100 2,556 TRW Inc. 300 12,600 Visteon Corp. 264 4,670 ------------ 70,607 Automobiles - 0.68% Ford Motor Co. 4,531 118,372 General Motors Corp. 1,300 80,763 Harley Davidson Inc. 700 33,731 ------------ 232,866 Banks - 4.63% Amsouth BanCorp.oration 900 12,544 Bank of America Corp. 3,900 187,444 Bank New York Inc. 1,800 103,613 Bank One Corp. 2,800 102,200 BB+T Corp. 1,000 31,875 Charter One Finl Inc. 520 11,928 Chase Manhattan Corp. 3,100 141,050 Comerica Inc. 400 24,125 Fifth Third BanCorp. 1,100 56,513 First Union Corp. 2,300 69,719 Firstar Corp. 2,300 45,281 Fleet Boston Finl Corp. 2,100 79,800 Golden West Finl Corp. 400 22,425 Huntington Bancshares Inc. 640 9,200 KeyCorp. 1,000 24,688
Shares Value ------ ----- Banks - continued Mellon Finl Corp. 1,200 $57,900 Morgan J P + Co Inc. 400 66,200 National City Corp. 1,400 29,925 Northern Trust Corp. 500 42,688 Old Kent Financial Corp. 315 8,722 PNC Finl Svcs Group Inc. 700 46,813 Regions Financial Corp. 500 11,781 South Trust Corp. 400 12,950 Summit BanCorp. 400 15,000 Suntrust Banks Inc. 700 34,169 Synovus Finl Corp. 700 15,094 Union Planters Corp. 300 10,144 US BanCorp. 1,800 43,538 Wachovia Corp. 500 27,000 Washington Mutual Inc. 1,300 57,200 Wells Fargo + Co. 3,900 180,619 ------------ 1,582,143 Beverages - 1.93% Anheuser Busch Cos Inc. 2,200 100,650 Brown Forman Corp. 200 12,175 Coca Cola Co. 5,900 356,213 Coca Cola Enterprises Inc. 1,000 18,375 Coors Adolph Co. 100 6,369 Pepsico Inc. 3,400 164,688 ------------ 658,469 Biotechnology - 0.57% Amgen Inc.* 2,400 139,050 Biogen Inc.* 400 24,075 Medimmune Inc.* 500 32,688 ------------ 195,813 Building Products - 0.07% Armstrong Hldgs Inc. 100 288 Crane Co. 100 2,619 Masco Corp. 1,100 20,556 ------------ 23,463 Chemicals - 0.83% Air Prods + Chems Inc. 500 18,656 Dow Chem Co. 1,600 49,000 Du Pont E I De Nemours + Co. 2,500 113,438 Eastman Chem Co. 200 8,575 Engelhard Corp. 300 6,263 FMC Corp.* 100 7,600 Grace, W R + Co.* 200 763 Great Lakes Chemical Corp. 100 3,338 Hercules Inc. 300 5,494 International Flavours* 200 3,350 PPG Inds Inc. 400 17,850 Praxair Inc. 400 14,900 Rohm + Haas Co. 500 15,031 Sigma Aldrich 200 7,150 Union Carbide Corp. 300 12,900 ------------ 284,306
The accompanying notes are an integral part of the financial statements. 82 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Commercial Services & Supplies - 1.09% Allied Waste Industries Inc.* 500 $4,625 Automatic Data Processing Inc. 1,500 97,969 Avery Dennison Corp. 300 15,150 Block, H + R Inc. 200 7,138 Cendant Corp.* 1,700 20,400 Convergys Corp.* 400 17,425 Deluxe Corp. 200 4,513 Donnelley, R R + Sons Co. 300 6,450 Ecolab Inc. 300 11,756 Equifax Inc. 300 10,350 First Data Corp. 1,000 50,125 IMS Health Inc. 700 16,538 Paychex Inc. 900 51,019 Pitney Bowes Inc. 600 17,813 Sabre Hldgs Corp. 299 9,998 Waste Mgmt Inc. 1,500 30,000 ------------ 371,267 Communications Equipment - 5.47% ADC Telecommunications Inc.* 1,900 40,613 Andrew Corp.* 200 5,263 Avaya Inc.* 658 8,842 Cabletron Systems Inc.* 400 10,850 Cisco Sys Inc.* 16,900 910,488 Comverse Technology Inc.* 400 44,700 Corning Inc. 2,100 160,650 JDS Uniphase Corp.* 2,200 179,025 Lucent Technologies Inc. 7,900 184,169 Motorola Inc. 5,200 129,675 Qualcomm Inc.* 1,800 117,197 Scientific Atlanta Inc. 400 27,375 Tellabs Inc.* 1,000 49,938 ------------ 1,868,782 Computers & Peripherals - 6.13% Apple Computer* 800 15,650 Compaq Computer Corp. 4,000 121,640 Dell Computer Corp.* 6,200 182,900 E M C Corp.* 5,200 463,125 Gateway Inc.* 800 41,288 Hewlett Packard Co. 4,800 222,900 IBM 4,200 413,700 Lexmark Intl Inc.* 300 12,300 NCR Corp.* 200 8,625 Network Appliance Inc.* 700 83,300 Palm Inc.* 1,339 71,720 Seagate Technology* 500 34,938 Sun Microsystems Inc.* 3,800 421,325 ------------ 2,093,411 Construction & Engineering - 0.02% Fluor Corp. 200 7,000 Mcdermott Intl Inc. 100 969 ------------ 7,969
Shares Value ------ ----- Construction Materials - 0.02% Vulcan Materials Co. 200 $8,400 ------------ Containers & Packaging - 0.08% Ball Corp. 100 3,513 Bemis Inc. 100 2,588 Crown Cork + Seal Inc. 300 2,738 Owens Illinois Inc.* 300 1,781 Pactiv Corp.* 400 4,200 Sealed Air Corp.* 200 9,625 Temple Inland Inc. 100 4,475 ------------ 28,919 Diversified Financials - 5.91% American Express Co. 3,200 192,000 Associates First Cap Corp. 1,700 63,113 Bear Stearns Cos Inc. 300 18,188 Capital One Finl Corp. 500 31,563 CIT Group Inc. 650 11,334 Citigroup Inc. 10,666 561,298 Countrywide Cr Inds Inc. 300 11,231 Federal Home Ln Mtg Corp. 1,700 102,000 Federal Natl Mtg Assn. 2,400 184,800 Franklin Res Inc. 600 25,704 Household Intl Inc. 1,100 55,344 Lehman Brothers Hldgs Inc. 600 38,700 MBNA Corp. 2,000 75,125 Merrill Lynch + Co Inc. 1,900 133,000 Moodys Corp. 400 10,525 Morgan Stanley Dean Witter + Co. 2,700 216,844 Paine Webber Group Inc. 400 28,500 Price, T Rowe + Assoc Inc. 300 14,044 Providian Finl Corp. 300 31,200 Schwab Charles Corp. 3,300 115,913 State Street Corp.oration 400 49,896 Stilwell Financial Inc. 550 24,647 USA Education Inc. 400 22,350 ------------ 2,017,317 Diversified Telecommunication - 6.18% Alltel Corp 800 51,550 AT + T Corp. 8,900 206,369 Bellsouth Corp. 4,500 217,406 CenturyTel Inc. 300 11,550 Global Crossing Ltd* 2,100 49,613 Nortel Networks Corp. 7,100 323,050 Qwest Communications Intl Inc.* 3,929 191,048 SBC Communications Inc. 8,100 467,269 Sprint Corp.* 2,100 53,550 Verizon Communications 6,518 376,822 Worldcom Inc.* 6,800 161,500 ------------ 2,109,726 Electric Utilities - 1.94% AES Corp.* 1,050 59,325 Ameren Corp. 300 11,925 American Elec Pwr Inc. 740 30,710
The accompanying notes are an integral part of the financial statements. 83 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Electric Utilities - continued Cinergy Corp. 400 $12,250 CMS Energy Corp. 300 8,100 Consolidated Edison Inc. 500 17,594 Constellation Energy Group Inc. 400 16,675 CP + L Energy Inc. 400 16,125 Dominion Res Inc. 600 35,738 DTE Energy Co. 300 10,838 Duke Energy Co. 900 77,794 Dynegy Inc. 700 32,419 Edison Intl 800 19,100 Entergy Corp. 500 19,156 Exelon Corp. 750 45,094 FirstEnergy Corp. 500 12,938 Florida Progress Corp. 200 10,638 FPL Group Inc. 400 26,400 GPU Inc. 300 9,919 Niagara Mohawk Hldgs Inc.* 400 6,400 PG+E Corp. 900 24,244 Pinnacle West Cap Corp. 200 8,688 PPL Corp. 300 12,356 Public Svc Enterprise Group 500 20,750 Reliant Energy Inc. 700 28,919 Southern Co. 1,500 44,063 TXU Corp. 600 22,238 XCEL Energy Inc. 810 20,706 ------------ 661,097 Electrical Equipment - 0.47% American Pwr Conversion Corp.* 500 6,469 Cooper Inds Inc. 200 7,650 Emerson Elec Co. 1,000 73,438 Molex Inc. 500 27,000 National Svc Inds Inc. 100 2,044 Power One Inc.* 200 14,188 Rockwell Intl Corp. 400 15,725 Thermo Electron Corp.* 450 13,050 Thomas + Betts Corp. 100 1,513 ------------ 161,075 Electronic Equipment & Instruments - 0.54% Agilent Technologies Inc.* 1,099 50,897 Millipore Corp. 100 5,250 Perkinelmer Inc. 100 11,950 Sanmina Corp.* 400 45,725 Solectron Corp.* 1,400 61,600 Tektronix Inc. 100 7,125 ------------ 182,547 Energy Equipment & Services - 0.65% Baker Hughes Inc. 800 27,500 Halliburton Co. 1,100 40,769 Nabors Industries Inc.* 300 15,270 Rowan Cos Inc.* 200 5,038 Schlumberger Ltd 1,400 106,575 Transocean Sedco Forex Inc. 500 26,500 ------------ 221,651
Shares Value ------ ----- Food & Drug Retailing - 1.01% Albertsons Inc. 1,000 $23,688 CVS Corp. 900 47,644 Kroger Co.* 2,000 45,125 Longs Drug Stores Corp. 100 2,188 Safeway Inc.* 1,200 65,625 Supervalu Inc. 300 4,613 Sysco Corp. 800 41,750 Walgreen Co. 2,400 109,500 Winn Dixie Stores Inc. 300 5,775 ------------ 345,906 Food Products - 1.12% Archer Daniels Midland Co. 1,460 16,060 Campbell Soup Co. 1,000 29,250 Conagra Inc. 1,300 27,788 General Mls Inc. 700 29,225 Heinz, H J Co. 800 33,550 Hershey Foods Corp. 300 16,294 Kellogg Co. 1,000 25,375 Nabisco Group Hldg Corp. 800 23,100 Quaker Oats Co. 300 24,469 Ralston Purina Co. 700 16,975 Sara Lee Corp. 2,100 45,281 Unilever N V 1,400 71,138 Wrigley (WM) Jr Co. 300 23,756 ------------ 382,260 Gas Utilities - 0.27% Columbia Energy Group 200 14,388 Eastern Enterprises 100 6,438 El Paso Energy Corp. 600 37,613 Keyspan Corp. 350 12,316 Nicor Inc. 100 3,531 Oneok Inc. 100 3,963 Peoples Energy Corp. 100 3,438 Sempra Energy 500 10,344 ------------ 92,028 Health Care Equipment & Supplies - 1.19% Allergan Inc. 300 25,219 Bard, C R Inc. 100 4,188 Bausch + Lomb Inc. 100 3,856 Baxter Intl Inc. 700 57,531 Becton Dickinson + Co. 600 20,100 Biomet Inc. 400 14,475 Boston Scientific Corp.* 1,000 15,938 Guidant Corp.* 700 37,056 Medtronic Inc. 2,900 157,506 PE Corp. 500 58,500 St Jude Med Inc.* 200 11,000 ------------ 405,369 Health Care Providers & Services - 0.91% Aetna Inc. 300 17,344 Cardinal Health Inc. 700 66,325 Cigna Corp. 400 48,780
The accompanying notes are an integral part of the financial statements. 84 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Health Care Providers & Services - continued HCA Healthcare Co. 1,300 $51,919 Healthsouth Corp.* 900 10,800 Humana Inc.* 400 4,850 Manor Care Inc.* 200 3,338 McKesson HBOC Inc. 700 19,644 Quintiles Transnational Corp.* 300 4,181 Tenet Healthcare Corp. 700 27,519 Unitedhealth Group Inc. 400 43,750 Wellpoint Health Networks Inc.* 100 11,694 ------------ 310,143 Hotels, Restaurants & Leisure - 0.62% Carnival Corp. 1,400 34,738 Darden Restaurants Inc. 300 6,750 Harrahs Entmt Inc.* 300 8,588 Hilton Hotels Corp. 900 8,550 Marriott Intl Inc. 600 24,300 McDonalds Corp. 3,100 96,100 Starbucks Corp.* 400 17,875 Tricon Global Restaurants Inc.* 300 9,000 Wendys Intl Inc. 300 6,525 ------------ 212,425 Household Durables - 0.22% American Greetings Corp. 200 3,638 Black + Decker Corporation 200 7,525 Centex Corp. 100 3,700 Fortune Brands Inc. 400 11,775 Kaufman + Broad Home Corp. 100 2,975 Leggett + Platt Inc. 500 8,188 Maytag Corp. 200 5,725 Newell Rubbermaid Inc. 600 11,513 Pulte Corp. 100 3,331 Stanley Works 200 5,325 Tupperware Corp. 100 1,713 Whirlpool Corp. 200 8,700 ------------ 74,106 Household Products - 1.27% Clorox Co. 600 26,775 Colgate Palmolive Co. 1,400 82,264 Fort James Corp. 500 16,469 Kimberly Clark Corp. 1,300 85,800 Procter + Gamble Co. 3,100 221,456 ------------ 432,764 Industrial Conglomerates - 4.77% General Elec Co. 23,600 1,293,575 ITT Inds Inc. 200 6,513 Minnesota Mng + Mfg Co. 900 86,963 Textron Inc. 300 15,131 Tyco Intl Ltd 3,999 226,711 ------------ 1,628,893 Insurance - 3.13% Aflac Inc. 600 43,838 Allstate Corp. 1,700 68,425
Shares Value ------ ----- Insurance - continued American Gen Corp. 600 $48,300 American Intl Group Inc. 5,550 543,900 AON Corp. 600 24,863 Chubb Corp. 400 33,775 Cincinnati Finl Corp. 400 14,700 Conseco Inc. 800 5,550 Hartford Financial Svcs Grp 500 37,219 Jefferson Pilot Corp. 200 13,750 Lincoln Natl Corp. 500 24,188 Loews Corp. 200 18,188 Marsh + Mclennan Cos Inc. 600 78,450 MBIA Inc. 200 14,538 MGIC Invest. Corp. 300 20,438 Progressive Corp. 200 19,650 Safeco Corp. 300 7,256 St Paul Cos Inc. 500 25,625 Torchmark Inc. 300 9,994 UnumProvident Corp. 600 16,950 ------------ 1,069,594 Internet Software & Services - 1.04% America Online Inc.* 5,500 277,365 Yahoo Inc.* 1,300 76,213 ------------ 353,578 IT Consulting Services - 0.30% Ceridian Corp.* 300 7,500 Computer Sciences Corp.* 400 25,200 Electronic Data Sys Corp. 1,100 51,631 Sapient Corp.* 300 10,669 Unisys Corp.* 700 8,925 ------------ 103,925 Leisure Equipment & Products - 0.16% Brunswick Corp. 200 3,888 Eastman Kodak Co. 700 31,413 Hasbro Inc. 400 4,300 Mattel Inc. 1,000 12,938 Polaroid Corp. 100 1,006 ------------ 53,544 Machinery - 0.58% Briggs + Stratton Corp. 100 3,569 Caterpillar Inc. 800 28,050 Cummins Engine Inc. 100 3,400 Danaher Corp. 300 18,938 Deere + Co. 600 22,088 Dover Corp. 500 21,219 Eaton Corp. 200 13,613 Illinois Tool Wks Inc. 700 38,894 Ingersoll Rand Co. 400 15,100 Navistar Intl Corp. Inc.* 100 3,306 Paccar Inc. 200 8,413 Pall Corp. 300 6,469 Parker Hannifin Corp. 300 12,413 Timken Co. 100 1,406 ------------ 196,875
The accompanying notes are an integral part of the financial statements. 85 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Media - 3.13% Clear Channel Communications* 1,400 $84,088 Comcast Corp.* 2,200 89,650 Disney Walt Co. 5,000 179,063 Dow Jones + Co Inc. 200 11,775 Gannett Inc. 600 34,800 Harcourt Gen Inc. 200 11,210 Interpublic Group Cos Inc. 700 30,056 Knight Ridder Inc. 200 10,050 Mcgraw Hill Cos Inc. 500 32,094 Meredith Corp. 100 3,175 New York Times Co. 400 14,700 Omnicom Group 400 36,900 Seagram Ltd 1,000 57,125 Time Warner Inc. 3,200 242,912 Tribune Co. 700 25,944 Viacom Inc.* 3,600 204,750 ------------ 1,068,291 Metals & Mining - 0.43% Alcan Alum Ltd 800 25,250 Alcoa Inc. 2,100 60,244 Allegheny Technologies Inc. 200 4,050 Barrick Gold Corp. 900 12,038 Bethlehem Steel Corp.* 300 863 Freeport Mcmoran Copper + Gold* 400 3,175 Homestake Mng Co.* 600 2,475 INCO Ltd* 400 6,175 Newmont Mng Corp. 400 5,425 Nucor Corp. 200 6,938 Phelps Dodge Corp. 200 9,350 Placer Dome Inc. 800 6,500 U. S. Steel Group 200 3,188 Worthington Industries Inc. 200 1,913 ------------ 147,581 Multiline Retail - 2.11% Consolidated Stores Corp.* 300 3,563 Costco Wholesale Corp.* 1,100 40,288 Dillards Inc. 200 2,100 Dollar Gen Corp. 800 12,400 Federated Dept Stores Inc.* 500 16,281 K Mart Corp.* 1,100 6,531 Kohls Corp.* 800 43,350 May Dept Stores Co. 750 19,688 Nordstrom Inc. 300 4,931 J C Penney, Inc. 600 7,013 Sears Roebuck + Co. 800 23,784 Target Corp. 2,200 60,775 Wal Mart Stores Inc. 10,600 480,975 ------------ 721,678 Multi Utilities - 0.57% Enron Corp. 1,800 147,713 Williams Cos Inc. 1,100 45,994 ------------ 193,706
Shares Value ------ ----- Office Electronics - 0.04% Xerox Corp. 1,600 $13,500 ------------ Oil & Gas - 4.57% Amerada Hess Corp. 200 12,400 Anadarko Pete Corp. 627 40,159 Apache Corp. 300 16,594 Ashland Inc. 200 6,550 Burlington Res Inc. 500 18,000 Chevron Corp. 1,600 131,400 Coastal Corp. 500 37,719 Conoco Inc. 1,500 40,781 Devon Energy Corporation 300 15,120 Exxon Mobil Corp. 8,300 740,256 Kerr Mcgee Corp. 200 13,063 Occidental Petroleum Corp. 900 17,888 Phillips Petroluem Co. 600 37,050 Royal Dutch Petroleum Co. 5,100 302,813 Sunoco Inc. 200 5,988 Texaco Inc. 1,300 76,781 Tosco Corp. 300 8,588 Unocal Corp. 600 20,475 Usx Marathon Group 700 19,031 ------------ 1,560,654 Paper & Forest Products - 0.32% Boise Cascade Corp. 100 2,869 Georgia Pac Corp. 400 10,750 International Paper Co. 1,200 43,950 Louisiana Pac Corp. 200 1,700 Mead Corp. 200 5,788 Potlatch Corp. 100 3,350 Westvaco Corp. 200 5,700 Weyerhaeuser Co. 500 23,469 Willamette Inds Inc. 300 10,894 ------------ 108,469 Personal Products - 0.35% Alberto Culver Co. 100 3,356 Avon Prods Inc. 600 29,100 Gillette Co. 2,500 87,188 ------------ 119,644 Pharmaceuticals - 8.13% Abbott Labs 3,700 195,406 Alza Corp.* 300 24,281 American Home Products Corp. 3,100 196,850 Bristol Myers Squibb Co. 4,700 286,406 Johnson + Johnson 3,300 304,013 King Pharmaceuticals Inc.* 400 17,925 Lilly Eli + Co. 2,700 241,313 Merck + Co Inc. 5,500 494,656 Pfizer Inc. 15,050 649,972 Pharmacia Corp. 3,100 170,500 Schering Plough Corp. 3,500 180,906 Watson Pharmaceuticals Inc.* 200 12,513 ------------ 2,774,741
The accompanying notes are an integral part of the financial statements. 86 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Road & Rail - 0.24% Burlington Northern Santa Fe 1,000 $26,563 CSX Corp. 500 12,656 Norfolk Southern Corp. 900 12,713 Ryder Sys Inc. 100 1,975 Union Pac Corp. 600 28,125 ------------ 82,031 Semiconductor Equipment & Products - 4.50% Adaptec Inc.* 200 3,163 Advanced Micro Devices Inc.* 700 15,838 Altera Corp.* 1,000 40,938 Analog Devices Inc.* 800 52,000 Applied Materials Inc.* 1,900 100,938 Broadcom Corp.* 550 122,306 Conexant Sys Inc.* 500 13,156 Intel Corp. 16,000 720,000 KLA Tencor Corp.* 400 13,525 Linear Technology Corp. 700 45,194 LSI Logic Corp.* 700 23,013 Maxim Integrated Prods Inc.* 700 46,419 Micron Technology Inc.* 1,300 45,175 National Semiconductor Corp.* 400 10,400 Novellus Sys Inc.* 300 12,281 Teradyne Inc.* 400 12,500 Texas Instrs Inc. 4,100 201,156 Xilinx Inc.* 800 57,950 ------------ 1,535,950 Software - 5.09% Adobe Sys Inc. 600 45,638 Autodesk Incorporated 100 2,206 BMC Software Inc.* 600 12,188 Citrix Sys Inc.* 400 8,850 Computer Assoc Intl Inc. 1,400 44,625 Compuware Corp.* 900 7,088 Mercury Interactive Corp.* 200 22,200 Microsoft Corp.* 12,500 860,938 Novell Inc.* 800 7,200 Oracle Corp.* 13,400 442,200 Parametric Technology Corp.* 600 7,388 Peoplesoft Inc.* 700 30,548 Siebel Sys Inc.* 1,000 104,938 Synavant Inc.* 30 137 Veritas Software Corp.* 1,000 141,016 ------------ 1,737,157 Specialty Retail - 1.48% Autozone Inc.* 300 8,044 Bed Bath + Beyond Inc.* 700 18,069 Best Buy Co Inc.* 500 25,094 Circuit City Stores Inc. 500 6,625 Gap Inc. 2,000 51,625 Home Depot Inc. 5,500 236,500 Limited Inc. 1,000 25,250 Lowes Cos Inc. 900 41,119
Shares Value ------ ----- Specialty Retail - continued Office Depot Inc.* 700 $5,819 Radioshack Corp. 400 23,850 Sherwin Williams Co. 400 8,675 Staples Inc.* 1,100 15,675 Tiffany + Co. 300 12,806 TJX Cos Inc. 700 19,075 Toys R Us Inc.* 500 8,594 ------------ 506,819 Textiles & Apparel - 0.12% Liz Claiborne Inc. 100 4,250 Nike Inc. 600 23,963 Reebok Intl Ltd* 100 2,156 Russell Corp. 100 1,600 V F Corp. 300 8,194 ------------ 40,163 Tobacco - 0.61% Philip Morris Cos Inc. 5,400 197,775 UST Inc. 400 10,100 ------------ 207,875 Trading Companies & Distributors - 0.04% Genuine Parts Co. 400 8,525 Grainger W W Inc. 200 6,388 ------------ 14,913 Wireless Telecommunication Service - 0.45% Nextel Communications Inc.* 1,800 69,188 Sprint Corp. 2,200 83,875 ------------ 153,063 ------------ TOTAL COMMON STOCKS (Cost $27,927,611) $29,976,500 ------------ Principal Value --------- ----- U.S. TREASURY OBLIGATIONS- SHORT TERM - 1.05% U.S. Treasury Bills - 0.90% 6.31% due 12/21/00 $125,000 $123,861 5.90% due 11/02/00 75,000 74,988 6.07% due 12/21/00 10,000 9,916 6.12% due 12/21/00 100,000 99,150 ------------ 307,914 U.S. Treasury Bonds - 0.15% 5.99% due 12/07/00 50,000 49,701 ------------ TOTAL U.S. TREASURY OBLIGATIONS-SHORT TERM (Cost $357,615) $357,615 ------------ REPURCHASE AGREEMENTS - 11.15% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $3,808,670 on 11/01/00, collateralized by $3,915,000 U.S.Treasury Notes, 5.875% due 09/30/02 (valued at $3,994,985, including interest) (Cost $3,808,000) $3,808,000 $3,808,000 ------------ TOTAL INVESTMENTS (Stock Index Fund ) (Cost $32,093,226) $34,142,115 ------------
The accompanying notes are an integral part of the financial statements. 87 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Global Equity Fund - --------------------------------------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 99.90% Aerospace - 1.64% Embraer-Empresa Brasileira de Aero 20,925 $605,517 ------------ Air Freight & Couriers - 1.05% TNT Post Group NV 18,325 388,143 ------------ Banking - 6.65% Banco Santander Central Hispano SA 37,825 366,563 Bank Of New York 2,234 128,595 Citigroup, Inc. 15,261 803,110 Fifth Third Bancorp 4,646 238,688 ForeningsSparbanken AB (SW) 28,475 408,931 San Paolo-IMI SPA 18,650 302,284 Wells Fargo 4,425 204,933 ------------ 2,453,104 Biotechnology - 0.98% Amgen, Inc.* 3,174 183,894 Genentech, Inc.* 2,164 178,530 ------------ 362,424 Building Materials - 0.97% Cemex 17,000 359,125 ------------ Commercial Services & Supplies - 3.33% Havas Advertising SA 18,875 304,169 Omnicom Group 1,170 107,933 WPP Group 21,500 288,558 ISS A/S* 4,100 252,466 Securitas AB 13,000 277,113 ------------ 1,230,238 Computer Equipment - 4.87% EMC Corp.* 9,066 807,441 Network Appliance Inc.* 1,429 170,051 Sun Microsystems, Inc.* 7,374 817,592 ------------ 1,795,084 Computer Networking - 3.31% Cisco Systems, Inc.* 22,698 1,222,855 ------------ Consumer Products - 2.90% Altadis SA 25,150 376,692 Reckitt Benckiser plc 22,000 289,203 The Swatch Group AG 305 403,816 ------------ 1,069,711 Diversified - 1.24% Corning, Inc 5,978 457,317 ------------ Electronics - 10.41% Epcos AG* 4,200 318,347 Flextronics International* 9,250 351,500 General Electric Co. 18,432 1,010,304 Jabil Circuit, Inc.* 2,125 121,258 Murata Manufacturing Co., Ltd. 2,305 275,886 NEC Corporation 21,000 400,312 Philips Electronics 20,363 813,247
Shares Value ------ ----- Electronics - continued Pioneer Corporation 8,000 $247,812 Samsung Elect.-GDR 4,100 301,350 ------------ 3,840,016 Financial Services - 0.72% Federal National Mortgage Assoc. 3,425 263,725 ------------ Food & Beverages - 1.82% Ajinomoto Co., Inc. 34,000 380,149 Heineken NV 5,375 291,919 ------------ 672,068 Health Care Services & Supplies - 2.41% Fresenius Medical Care AG-ADR 20,100 293,963 Baxter International, Inc. 2,782 228,646 Synthes-Stratec Inc.* 144A 575 366,252 ------------ 888,860 Hotels, Restaurants & Leisure Time - 1.94% Accor 9,100 368,352 Viacom, Inc.* 6,098 346,824 ------------ 715,176 Insurance - 1.39% Alleanza Assicurazioni 38,725 513,634 ------------ Manufacturing - 4.09% Assa Abloy AB 17,500 322,248 Perlos OYJ SA (FI) 26,400 562,317 Tyco International Ltd. 11,006 623,903 ------------ 1,508,467 Media - 4.44% AT&T Corp. - Liberty Media Group* 5,375 96,750 Comcast Corporation Class A Special* 6,342 258,437 General Motors Corp.-Hughes* 4,781 154,904 Societe Europeenne des Satellites 2,675 356,391 Time Warner, Inc. 5,621 426,690 VNU NV 144A 7,300 343,810 ------------ 1,636,982 Natural Gas - 0.94% Tokyo Gas Co., Ltd. 133,000 347,386 ------------ Oil & Gas - 4.11% Petroleo Brasileiro* 4,200 122,063 BP Amoco PLC ADR 7,600 387,125 Total Fina Elf SA 3,520 503,621 Halliburton 3,600 133,425 Saipem 71,000 369,939 ------------ 1,516,172 Pharmaceuticals - 7.06% Glaxo Wellcome 15,500 446,196 Merck & Company, Inc. 4,896 440,334 Novo Nordisk 2,300 487,827 Pfizer, Inc. 20,846 900,287 Takeda Chemical Industries, Ltd. 5,000 329,469 ------------ 2,604,113
The accompanying notes are an integral part of the financial statements. 88 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Retail - 4.34% Fast Retailing Co., Ltd. 2,600 $639,784 Home Depot, Inc. 8,026 345,118 Kohl's Corp.* 3,996 216,533 Walgreen Company 3,349 152,798 Wal-Mart Stores, Inc. 5,480 248,655 ------------ 1,602,888 Road & Rail - 0.34% MTR Corp.* 144A 84,000 124,401 ------------ Semiconductor Equipment & Products - 5.07% Analog Devices, Inc.* 2,100 136,500 Applied Micro Circuits Corp.* 1,850 141,294 Broadcom Corporation* 779 173,230 Intel Corp. 8,143 366,435 JDS Uniphase Corp.* 5,058 411,595 STMicroelectronics N.V. 3,600 181,617 Taiwan Semiconductor Man. Co.* 7,500 170,156 The Furukawa Electric Co., Ltd. 11,000 289,328 ------------ 1,870,155 Software - 7.81% Business Objects S.A.* 3,475 268,349 Check Point Software Tech. Ltd.* 3,050 483,044 Dassault Systemes SA (FR) 4,675 356,454 Logica plc 10,600 313,599 Microsoft Corp.* 2,725 187,684 Oracle Systems Corp.* 12,442 410,586 Redback Networks, Inc.* 1,141 121,445 The Sage Group plc 45,900 334,991 Veritas Software* 2,883 406,548 ------------ 2,882,700 Telephone - 0.92% Tele Norte Leste Participacoes 15,400 340,725 ------------ Telecommunication Services - 6.16% China Mobile (HK) Ltd.* 77,000 493,653 Energis PLC* 40,875 349,618 Juniper Networks, Inc.* 1,158 225,810 Nippon Telegraph and Telephone 50 455,025 Partner Comm. Co. Ltd.* 4,200 25,200 Vodafone Airtouch Public Ltd. 145,625 605,887 VoiceStream Wireless Corp.* 908 119,402 ------------ 2,274,594 Telecommunications Equipment - 8.99% Alcatel SA (FR) 14,200 866,404 Ciena Corp.* 4,175 438,897 Comverse Technology, Inc.* 1,602 179,024 Marconi Plc 25,025 315,897 Nokia Oyj Sponsored ADR 19,795 846,236 Nortel Networks Corporation 9,000 409,500 TyCom, Ltd.* 7,775 260,463 ------------ 3,316,420 TOTAL COMMON STOCKS (Cost $36,769,171) $36,862,000 ------------
Shares Value ------ ----- PREFERRED STOCK - 0.03% Fresenius Medical (Cost $11,334) 250 $10,607 ------------ RIGHTS & WARRANTS - 0.07% Logica Plc (Cost $14,168) 850 $24,419 ------------ SHORT TERM INVESTMENTS - 0.00% SSGA Money Market Fund (Cost $1,000) 1,000 $1,000 ------------ TOTAL INVESTMENTS (Global Equity Fund) (Cost $36,795,673) $36,898,026 ------------ - ----------------------------------------------------------- International Equity Fund - ----------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 93.64% Aerospace & Defense - 0.47% BAE Systems 18,372 $104,362 Singapore Technologies Engineering 11,000 70,899 Thomson CSF 1,073 48,168 ------------ 223,429 Appliances & Household Durables - 2.63% Daiwa House Industry Co. Ltd. 4,000 25,111 Electrolux AB 3,300 41,612 JM Bygg & Fastigh 900 20,536 Matsushita Electric Industrial 13,000 377,675 Philips Electronics 3,944 154,944 Sanyo Electric Company Ltd. 17,000 129,313 Sekisui House Ltd 7,000 74,032 Sharp Corporatio 7,000 89,172 Sony Corporatio 4,400 351,629 ------------ 1,264,024 Automobiles - 2.40% Daimlerchrysler AG 4,850 223,483 Fiat SpA 1,107 25,740 Honda Motor Company 2,000 69,101 Nissan Motors Company 13,000 89,236 Peugeot SA 291 53,587 Toyota Motor Corp. 15,200 607,359 Volkswagen AG 1,650 82,429 ------------ 1,150,935 Auto Components - 0.73% Bridgestone Corporation 6,000 59,497 Continental AG 800 12,220 Denso Corporation 4,000 91,280 GKN Plc 8,995 103,105 Michelin 960 27,780 Pirelli SpA 10,365 30,081 Valeo SA 616 26,816 ------------ 350,779
The accompanying notes are an integral part of the financial statements. 89 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Banking - 11.09% 77 Bank Ltd. 2,000 $14,810 Abbey National Plc. 6,246 86,186 Abn Amro Holdings NV 5,294 122,645 Asahi Bank Ltd. 13,000 51,230 Banca Intesa SpA 11,914 49,439 Banca Popolare di Milano 725 4,553 Banco Bilbao Vizcaya SA 24,660 328,546 Banco Bradesco SA 2,767,000 13,045 Banco Comercial Portugues SA 3,884 19,413 Banco di Roma 12,196 12,854 Banco Espirito Santo 593 9,008 Banco Santander Central Hispano 22,829 221,236 Bank of East Asia Ltd. 12,105 27,317 Bank of Tokyo-Mitsubishi Ltd. 21,000 251,927 Bank of Yokohama 2,000 9,806 Banque Nationale de Paris 1,206 103,979 Barclays Plc 8,178 233,995 Bayerische Hypo-Und Vereinsbank 2,000 109,894 Commonwealth Bank of Austria AG 1,507 22,426 Credit Suisse Holding 1,160 217,468 Daiwa Bank Ltd. 15,000 30,518 DBS Group Holdings Ltd. 16,815 198,184 Deutsche Bank AG 2,800 229,244 Dresdner Bank AG 2,000 83,333 Foereningssparbanken AB 3,100 44,519 Bank of Fukuoka Ltd. 2,000 9,824 Halifax Group Plc 10,224 80,403 Hang Seng Bank Ltd. 4,100 48,365 HSBC Holdings Plc 40,895 582,685 Joyo Bank Ltd. 6,400 21,878 Lloyds TSB Group Plc 23,107 235,360 Mediobanca SpA 1,439 16,009 Mizuho Holdings 30 230,674 National Australia Bank Ltd. 7,122 98,937 Oversea-Chinese Banking Corp. Ltd. 18,400 117,338 Royal Bank of Scotland 10,751 241,319 Sakura Bank Ltd. 19,000 138,432 San Paolo IMI SpA 3,357 54,411 Shizuoka Bank Ltd. 7,000 63,575 Skandinaviska Enskilda Banken 3,500 41,332 Societe Generale 1,547 87,825 Sumitomo Bank 14,000 170,004 Suncorp Metway Ltd. 1,664 8,453 Svenska Handelsbanken 3,900 61,277 Tokai Bank Ltd. 10,000 53,613 UBS AG 1,710 236,866 Unicredito Italiano 11,728 59,714 United Overseas Bank Ltd. 13,336 98,712 Westpac Banking Corp. 9,720 66,375 ------------ 5,318,956 Beverages & Tobacco - 2.15% Altadis SA 3,322 49,756 Asahi Breweries Ltd. 4,000 39,518
Shares Value ------ ----- Beverages & Tobacco - continued Austria Tabak AG 93 $4,262 British American Tobacco 20,704 145,095 Carlsberg A 100 4,333 Carlsberg B 100 4,185 Coca-Cola Amatil Ltd. 3,364 6,848 Diageo Plc 31,661 298,830 Fosters Brewing Group Ltd. 9,289 21,041 Fraser & Neave Ltd. 4,000 13,893 Heineken Holdings NV 3,945 214,255 Japan Tobacco Inc. 4 27,494 Kirin Brewery Company Ltd. 15,000 156,440 OYJ Hartwall 467 8,084 Pernod Ricard 681 31,206 Swedish Match AB 1,800 6,179 ------------ 1,031,419 Building Materials & Components - 0.56% Asahi Glass Company Ltd. 11,000 112,908 Buderus AG 300 5,685 Cie de Saint Gobain 600 79,378 Hanson Plc 158 838 Heidelberger Zement AG 300 14,256 Holderbank Financiere Glarus AG 20 5,886 Holderbank Financiere Glarus AG 10 10,508 Imerys 47 4,652 Italcementi Fabbriche Riunite 201 1,592 Lafarge SA 450 33,223 ------------ 268,926 Business & Public Services - 1.96% Adecco SA 140 96,807 Benesse Corporation Ltd. 700 38,492 Ste. BIC 482 16,709 Capita Group 5,904 44,974 Dai Nippon Printing Co. Ltd. 6,000 94,029 Hays 11,253 61,432 PT Multimedia* 300 1,527 Rentokil Initial Plc 12,399 28,605 Securitas AB 4,000 85,266 Soc. Gen. de Aguas de Barcelona 1,807 22,235 Suez Lyonnaise des Eaux 973 148,459 United Utilities Plc 4,613 46,384 Vedior NV 445 6,627 Vivendi SA 3,440 247,255 ------------ 938,801 Chemicals - 1.69% Akzo Nobel NV 856 38,971 Asahi Chemical Industry Co. Ltd. 9,000 55,758 BASF AG 4,500 176,424 Bayer AG 5,200 225,711 BOC Group Plc 4,065 56,622 Cin Corporacao Industrial Norte 170 570 Givaudan AG* 58 13,906 Imperial Chemical Industries Plc 8,735 53,484
The accompanying notes are an integral part of the financial statements. 90 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Chemicals - continued L'Air Liquide 467 $55,204 Mitsubishi Chemical Corp. 9,000 28,456 Orica Ltd. 610 1,834 SNIA SpA 2,631 5,448 Sumitomo Chemical Co. Ltd. 13,000 64,098 Teijin 2,000 9,055 Toray Industries, Inc. 7,000 27,265 ------------ 812,806 Communications Equipment - 0.79% Alcatel 709 43,259 L M Ericsson Telefon AB 10,850 144,416 Marconi Plc 3,548 44,787 Nokia AB 3,405 140,111 Sagem SA 31 5,682 ------------ 378,255 Computers & Peripherals - 1.33% Asustek Computer, Inc. 9,574 51,700 Asustek Computer, Inc. 144A 8 43 Creative Technology Ltd. 300 4,868 Fujitsu Ltd. 8,000 142,529 Legend Holdings 23,000 19,464 NEC Corporation 17,000 324,062 Psion 489 2,959 Toshiba Corporation 13,000 92,929 ------------ 638,554 Construction & Engineering - 0.58% Acs Actividades de Construccion 674 14,751 Bilfinger & Berger Bauaktienge 400 4,324 Bouygues 2,178 110,895 Fomento de Construcciones Y Contra 1,026 18,850 Grupo Dragados SA 1,931 18,763 Impregilo SpA 1,043 559 Kajima Corporation 17,000 44,247 Leighton Holdings Ltd. 1,436 4,980 Obayashi Corp 2,000 8,285 Penta-Ocean Construction Co. Ltd. 1,800 2,095 Sirti SpA 448 642 Skanska/Frueher AB 1,300 51,520 ------------ 279,911 Containers & Packaging - 0.14% Amcor Ltd. 3,419 9,481 Assidoman 153 2,605 Corticeira Amorim Socdad Gestora 158 1,082 Oji Paper Co. Ltd. 9,000 52,376 Reno de Medici SpA 295 611 ------------ 66,155 Electrical Equipment - 1.10% ABB AG 1,760 156,409 Mitsubishi Electric Corp. 19,000 136,517 Schneider SA 1,067 69,494 Sumitomo Electric Industries 9,000 166,201 ------------ 528,621
Shares Value ------ ----- Electronic Components & Instruments - 0.88% Alps Electric Co. Ltd. 1,000 $19,796 Canon, Inc. 3,000 119,049 Hitachi Ltd. 11,000 117,949 Kyocera Corporation 800 104,110 Nidec Corporation 400 24,525 OCE NV 129 1,921 Omron Corp. 1,000 24,653 Venture Manufacturing, Singapore 1,000 9,679 ------------ 421,682 Energy Sources - 9.00% BP Amoco Plc 178,879 1,517,152 Broken Hill Proprietary Co. Ltd. 5,179 50,201 Ente Nazionale Idrocarburi SpA 60,283 326,376 Japan Energy Corp. 2,000 2,658 Nippon Mitsubishi Oil Corp. 22,000 118,352 Petrol Brasilieros 3,590 103,995 Repsol SA 9,908 157,396 Royal Dutch Petroleum Co. NV 17,328 1,027,701 Santos Ltd. 4,985 15,866 Showa Shell Sekiyu 2,000 10,063 Total Fina Elf SA 6,914 989,214 ------------ 4,318,974 Financial Services - 4.33% Acom Co. Ltd. 1,700 137,570 Amvescap 4,450 99,434 BPI-SGPS SA* 4,425 14,382 Chuo Mitsui Trust 4,000 12,207 Credit Saison Co. 1,100 23,287 Daiwa Securities Group, Inc. 17,000 188,361 ING Groep NV 5,822 399,789 Hutchison Whampoa Ltd. 4,100 50,994 Keppel Corporation Ltd. 11,000 21,921 Lend Lease Corp. Ltd. 2,908 34,044 Mitsubishi Trust & Banking Corp. 15,000 121,661 Nichiei Company Ltd. 300 1,320 Nomura Securities Co. Ltd. 21,000 445,539 Nordic Baltic Holding* 7,104 53,653 OM Gruppen AB 800 28,582 Orix Corporation 200 20,987 Promise Company Ltd. 1,700 127,599 Schroder Plc 1,680 30,397 Swire Pacific Ltd. 1,500 9,251 Takefuji Corporation 1,500 148,467 T.I. Group Plc 4,683 106,339 ------------ 2,075,784 Food & Household Products - 4.48% Ajinomoto Co., Inc. 6,000 67,085 Azucarera Ebro Agricolas 359 4,372 Cadbury Schweppes Plc 17,928 110,814 Danisco 200 7,914 Eridania Beghin-Say SA 328 25,232 Goodman Fielder Wattie Ltd. 6,827 4,423
The accompanying notes are an integral part of the financial statements. 91 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Food & Household Products - continued Groupe Danone 1,901 $265,854 Jeronimo Martins Sgps. SA 565 5,447 Kamps AG 300 4,773 KAO Corporation 6,000 179,810 Kerry Group 154 1,921 Nestle SA 540 1,118,992 Nissin Food Products 100 2,626 Orkla SA 800 14,441 Parmalat Finanziaria SpA 14,195 20,478 Raisio Group Plc 1,459 2,204 Tate & Lyle 1,970 6,303 Unilever NV 7,298 366,011 Unilever Plc 26,664 180,383 ------------ 2,389,083 Forest Products & Paper - 0.27% Investimentos Participacoes 119 616 Paperlinx 1,139 1,948 Portucel Industrial SA 660 3,719 Svenska Cellulosa AB 2,659 54,551 UPM-Kymmene 2,423 68,573 ------------ 129,407 Gold Mines - 0.00% Normandy Mining Ltd. 6,667 3,214 ------------ Health Care - 0.27% Nycomed Amersham 4,233 37,895 Smith & Nephew 2,652 10,890 Terumo Corporation 1,900 53,806 Fresenius Medical 200 15,915 Parkway Holdings Ltd. 7,000 14,348 ------------ 132,854 IT Consulting & Services - 0.48% Cap Gemini SA 518 82,640 Getronics NV 2,261 25,423 Logica 2,225 65,826 Sema Group 2,532 31,962 Tietoenator Corporation 646 12,417 Wm-Data Nordik AB 3,800 13,234 ------------ 231,502 Insurance - 6.71% Aegon NV 6,840 271,647 Allianz AG 2,050 695,069 AMP Limited* 5,121 46,161 Assicurazione Generali SpA 5,742 188,816 Axa 2,091 276,810 CGNU Plc 13,707 183,369 Corporacion Mapfre Cia International 809 14,245 Legal & General Group Plc 34,085 84,816 Muenchener Rueckversicherungs 1,450 455,889 Prudential Corporation Plc 11,144 149,890 QBE Insurance Group Ltd. 2,110 9,734 Riunione Adriatica de Sicurta 2,703 35,485
Shares Value ------ ----- Insurance - continued Sai Sta Assicuratrice Industrial 368 $6,105 Sampo Insurance Company Ltd. 953 38,818 Skandia Forsakring AB 10,500 178,112 Swiss Ruckversicherungs 105 207,068 Tokio Marine & Fire Insurance Co. 11,000 121,578 Zurich Financial Services Group* 526 254,371 ------------ 3,217,983 Leisure & Tourism - 0.87% Accor SA 1,621 65,615 Autogrill Spa 962 10,621 Bass Plc 7,239 70,846 Compass Group Plc 14,672 126,453 Hilton Group Plc 13,719 38,119 Hongkong & Shanghai Hotels Ltd. 500 298 Hotel Properties Ltd. 13,000 11,103 Oriental Land Company Plc 400 24,195 Sodexho Alliance SA 204 31,940 Sol Melia SA 1,076 9,843 Tabcorp Holdings Ltd. 1,711 9,302 Telepizza SA* 2,488 9,522 United Overseas Land Ltd. 9,000 7,943 ------------ 415,800 Leisure Equipment & Products - 0.69% Fuji Photo Film Company Ltd. 4,000 148,467 Nintendo Company Ltd. 1,100 181,964 ------------ 330,431 Machinery & Engineering - 1.60% Atlas Copco AB Ser A 1,300 27,581 Atlas Copco AB Ser B 800 16,533 Coflexip 150 17,375 Fag Kugelfischer Georg Schaefer 950 6,965 Fanuc Ltd. 2,100 188,608 Invensys Plc 27,067 64,604 Kawasaki Heavy Industries 2,000 2,071 Komatsu Ltd. 7,000 31,050 Kubota Corp 2,000 6,727 Linde AG 950 41,276 Man AG 800 21,093 Metso 1,401 10,700 Mitsubishi Heavy Industries Ltd. 28,000 108,803 Mitsui Engineering & Shipbuilding Co. 1,800 1,831 Sandvik AB,Ser A* 2,800 61,788 SKF AB 1,000 14,861 SMC Corporation 600 84,901 Stork NV 293 3,282 Sulzer AG* 10 6,459 Volvo AB, Series A 500 7,506 Volvo AB, Series B 1,800 27,741 Wartsila 606 9,771 Zardoya Otis SA 539 4,094 ------------ 765,620
The accompanying notes are an integral part of the financial statements. 92 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Media - 2.91% British Sky Broadcasting Group* 18,501 $151,602 Canal Plus SA 1,553 224,698 Carlton Communications 4,412 35,529 Elsevier NV 3,595 45,913 EM TV Merchandising 300 9,038 EMI Group Plc 4,796 35,907 Lagardere Groupe SCA 996 56,544 Mediaset SpA 5,508 79,693 News Corp Ltd. 9,864 103,180 Pearson Plc 3,342 89,659 Reed International Plc 6,185 57,165 Reuters Group* 8,677 168,956 Singapore Press Holdings 4,000 57,166 Thomson Corp 1,000 40,262 Tokyo Broadcasting System, Inc. 2,000 78,266 Toppan Printing Co. Ltd. 6,000 53,008 Wolters Kluwer NV 1,776 39,969 WPP Group 5,182 69,549 ------------ 1,396,104 Merchandising 3.20% Ahold NV 3,701 107,505 Boots Company Plc 4,949 39,494 Carrefour 3,493 234,465 Casino Guichard Perrachon 549 47,939 Coles Myer Ltd. 5,958 21,587 Cycle & Carriage Ltd. 4,000 7,288 Daiei Inc. 2,000 3,409 Dixons Group 11,032 32,814 Douglas Holding AG 600 17,872 Esprit Holdings 998 857 Great Universal Stores Plc 7,108 49,092 Hennes & Mauritz AB 8,000 149,715 Ito-Yokado Company Ltd. 2,000 90,363 Jusco Company Ltd. 4,000 75,150 Karstadt Quelle AG 500 16,319 Kesko Corporation 1,571 13,132 Kingfisher Plc 8,493 50,770 Marks & Spencer Plc 18,271 50,890 Marui Company Ltd. 2,000 29,510 Metro AG 2,150 86,663 Pinault-Printemps Redoute 796 142,055 Rinascente Per L'Esercizio 1,004 5,129 J. Sainsbury Plc 11,579 65,060 Sonae SGPS SA* 1,660 2,014 Tesco Plc 42,448 161,827 Valora Holding AG 40 8,133 Woolworths Ltd. 6,114 24,358 ------------ 1,533,410 Metals - Non-Ferrous - 0.42% Outakumpa 1,131 7,870 Pechiney SA 776 28,975 Rio Tinto Plc 7,244 117,194
Shares Value ------ ----- Metals - Non-Ferrous - continued Rio Tinto Ltd. 599 $8,222 SGL Carbon* 100 6,153 Siderar Nacional CIA 452,000 12,547 WMC Ltd. 5,758 22,012 ------------ 202,973 Metals - Steel - 0.42% Acerinox SA 483 13,440 Kawasaki Steel Corporation 9,000 8,826 Nippon Steel Corporation 51,000 82,729 Onesteel* 1,295 617 Pohang Iron & Steel 130 7,554 SSAB Swedish Steel 800 6,485 Sumitomo Metal Industries Ltd. 9,000 4,949 Thyssen Krupp AG 4,000 57,026 Usinor 2,039 22,234 ------------ 203,860 Multi-Industry - 2.20% Bradespar SA* 2,767,000 1,507 Brambles Industries Ltd. 1,149 29,791 Hopewell Holdings 1,000 362 Johnson Electric Holdings Ltd. 5,000 10,065 Lattice Group 23,981 51,149 Li & Fung 56,000 104,116 Pacific Dunlop Ltd. 5,638 4,501 Preussag AG 1,350 43,980 Sembcorp Industries Ltd. 26,000 25,019 Siemens AG 5,910 752,535 Sonae SGPS SA* 4,980 5,832 Southcorp Ltd. 3,321 8,580 Trelleborg AB 1,500 8,406 Wesfarmers Ltd. 978 7,467 ------------ 1,053,310 Personal Products - 0.99% Beiersdorf AG 1,450 139,043 L'Oreal 4,089 312,293 Shiseido Co. Ltd. 2,000 25,844 ------------ 477,180 Pharmaceuticals - 8.79% Astrazeneca Plc 9,620 450,568 Aventis SA 4,758 343,199 CSL Ltd. 558 9,926 Faulding & Co. Ltd. 660 3,490 Glaxo Wellcome Plc 19,740 568,252 Merck KGAA 500 19,009 Novartis AG 510 773,682 Roche Holding Chf100 Ords 12 129,673 Roche Holding Chf Genusschein NPV 53 484,123 Sankyo Co. Ltd. 4,000 88,164 Sanofi Synthelabo SA 4,825 253,859 Schering AG 600 33,605 Smithkline Beecham Plc 30,581 394,906 Taisho Pharmaceutical Co. Ltd. 4,000 115,108
The accompanying notes are an integral part of the financial statements. 93 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Pharmaceuticals - continued Takeda Chemical Industries Ltd. 7,000 $461,256 Yamanouchi Pharmaceutical Co. 2,000 90,547 ------------ 4,219,367 Real Estate - 1.81% British Land Company Plc 8,840 52,845 Burford Holdings 5,910 8,575 Canary Wharf Group* 1,977 15,433 Castellum AB 2,590 27,605 Chelsfield 2,311 12,239 Corporacion Financiera Alba SA 966 24,592 Cie Fonciere Klepierre 260 20,960 City Developments Ltd. 9,000 41,508 DBS Land Ltd. 17,000 25,844 Drott AB 2,530 29,750 First Capital Corporation Ltd. 4,000 3,234 Gecina 120 10,285 Grantchester Holdings Plc 9,850 26,154 Great Portland Estates Plc 3,642 13,713 Hammerson Plc 2,910 17,396 Hang Lung Development Co. Ltd. 1,000 898 Henderson Land Development 4,000 17,233 Hysan Development Co. Ltd. 1,000 1,269 Inmobilia Colonial 1,141 13,575 Interbail (Societe Financiere) 380 9,339 IVG Holding AG 1,363 15,094 Land Securities Plc 6,488 66,838 Metrovacesa SA 1,628 22,021 Mitsubishi Estate Company Ltd. 7,000 74,417 Mitsui Fudosan Company Ltd. 4,000 48,463 New World Development Co. Ltd. 13,097 15,534 Prima Inmobiloaroa SA 1,140 10,777 Rodamco Continental 330 11,846 SILIC 50 6,695 SIMCO* 320 19,823 Sino Land Company Ltd. 9,195 4,097 Slough Estates 4,470 23,932 Ste Fonciere Lyonnaise SA 120 11,711 Sun Hung Kai Properties Ltd. 6,000 49,237 Uni Invest SA 1,169 11,210 Unibail SA 295 39,303 United Industrial Corp. Ltd. 22,000 10,146 Vallehermoso SA 6,399 36,219 WCM Beteil & Grundbe 400 7,824 Wharf Holdings Ltd. 5,000 10,194 Wihlborgs Fastighets 1,300 1,860 ------------ 869,688 Semiconductors - 1.32% Advantest Corporation 500 65,206 ARM Holdings* 5,450 53,772 ASM Lithography* 5,286 144,484 Murata Manufacturing Co. Ltd. 1,900 227,411 Nikon Corporation 1,000 14,535
Shares Value ------ ----- Semiconductors - continued ST Microelectronics 1,101 $55,545 Tokyo Electron Ltd. 900 70,439 ------------ 631,392 Software - 1.13% Dassault Systemes 156 11,894 Misys Plc 4,061 42,307 Sage Group 7,462 54,460 SAP AG 1,550 253,727 Softbank Corporation 3,000 180,085 ------------ 542,473 Telecommunications - 5.04% British Telecommunications Plc 36,480 427,679 Deutsche Telekom AG 5,988 224,853 France Telecom SA 1,671 174,699 Koninklijke KPN NV 9 182 Netcom AB* 300 14,081 Nippon Telegraph & Telephone 31 282,115 Olivetti & Co. SpA 5,508 16,686 Pacific Century* 18,815 14,475 Portugal Telecom SA 1,598 14,239 Singapore Telecommunications Ltd. 23,900 39,600 Sonera Corporation 1,760 38,772 Swisscom AG 200 50,790 Telecom Italia Mobile SpA Eur 659 3,585 Telecom Italia Mobile SpA Eur 5,936 68,759 Telefonica SA USD* 475 27,520 Telefonica SA Euro* 8,755 166,941 Telstra Corporation Ltd. 14,170 46,244 TIM Spa 16,659 141,651 Vodafone Group 159,377 663,103 ------------ 2,415,974 Textiles & Apparel - 0.64% Adidas Salomon AG 300 13,773 Benetton Group SpA 7,898 14,343 Moet Hennessy Louis Vuitton 2,900 211,641 The Swatch Group AG 50 66,199 Toyobo Company Ltd. 1,800 3,002 ------------ 308,958 Transportation - Airlines - 0.55% British Airways Plc 9,634 43,054 Cathay Pacific Airways Ltd. 10,000 18,143 Deutsche Lufthansa AG 800 15,614 Japan Airlines Company Ltd. 4,000 16,020 Singapore Airlines Ltd. 17,000 170,358 ------------ 263,189 Transportation - Air Freight & Couriers - 0.14% Mayne Nickless Ltd. 1,965 5,215 TNT Post Groep NV 2,976 63,035 ------------ 68,250
The accompanying notes are an integral part of the financial statements. 94 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Transportation - Marine - 0.11% Nedlloyd NV 158 $2,936 Neptune Orient Lines Ltd.* 9,000 7,635 Nippon Yusen KK 2,000 9,385 P & O (Princess Cruises)* 3,826 15,030 P & O (Princess Cruises) GBP* 3,826 15,766 ------------ 50,752 Transportation - Road & Rail - 0.75% Central Japan Railway Company 9 54,850 East Japan Railway Company 18 103,432 Kinki Nippon Railway Company Ltd. 21,000 91,032 Nippon Express Company Ltd. 11,000 66,031 Railtrack Group Plc 2,932 45,350 ------------ 360,695 Transportation Infrastructure - 0.20% Autopistas Concesionaria Espanol 2,910 22,126 BAA Plc 7,043 58,555 Brisa Auto-Estradas de Portugal 2,155 16,660 ------------ 97,341 Utilities - Electrical & Gas - 5.15% Australian Gas Light Company 2,595 15,638 BG Group Plc 23,981 96,035 Centrica Plc 22,808 78,431 CLP Holdings Ltd. 6,000 28,004 E.On AG 8,120 412,611 Electricidade de Portugal 23,405 63,557 Eletrobras 1,880,000 33,385 Endesa SA 12,237 199,379 Enel SpA 44,988 166,833 Gas Natural Sdg SA 5,676 97,296 Hongkong & China Gas Company Ltd. 22,700 28,670 Iberdrola SA 11,410 139,525 International Power 4,829 19,478 Italgas Sta Italiana Per Il Gas 4,043 16,708 Kansai Electric Power Co., Inc. 11,400 186,700 National Grid Group Plc 9,027 78,259 Osaka Gas Company Ltd. 21,000 51,771 RWE AG 4,550 182,438 Scottish Power 11,249 84,465 Tohoku Electric Power Co., Inc. 5,600 75,443 Tokyo Electric Power Co., Inc. 13,700 332,722 Tokyo Gas Company 6,000 15,672 Union Electrica Fenosa 3,790 70,081 ------------ 2,473,101 Wholesale & International Trade - 0.16% Buhrmann NV 558 15,247 Hagemeyer NV 509 12,029 Mitsubishi Corporation 2,000 16,496 Mitsui & Company 2,000 13,289 Sumitomo Corporation 2,000 17,596 ------------ 74,657 TOTAL COMMON STOCKS (Cost $46,310,085) $44,926,579 ------------
Shares Value ------ ----- PREFERRED STOCKS - 1.36% Automobiles - 0.13% Fiat SpA 3,453 $51,513 Volkswagen AG 300 8,605 ------------ 60,118 Banks - 0.13% Banco Bradesco SA 2,767,000 17,104 Banco Itau SA 609,000 47,374 ------------ 64,478 Construction Materials - 0.00% Dyckerhoff AG 100 1,601 ------------ Electric Utilities - 0.05% Cemig (Cia Energetica de Minas) 1,307,000 19,841 RWE AG 100 3,140 ------------ 22,981 Food & Drug Retailing - 0.05% Pao de Acucar Cia* 609,000 21,696 ------------ Media - 0.16% News Corporation 8,738 78,358 ------------ Multi-industry - 0.00% Bradespar SA* 2,767,000 1,623 ------------ Oil & Gas - 0.13% Petrol Brasilieros 2,420 64,157 ------------ Other - 0.06% Ambev Cia de Bebid 130,000 29,011 ------------ Paper & Forest Products - 0.02% Aracruz Celulos SA 5,000 7,386 ------------ Software - 0.40% SAP AG 950 191,474 ------------ Telecommunications - 0.23% Braxil Telecomunicoes Participacoes SA 1,481,000 16,036 Embratel Participacoes SA 1,465,000 23,506 Tele Norte Leste Participacoes SA 1,607,083 35,088 Telesp Celular Participacoes SA 1,271,000 15,034 TIM Spa 3,970 21,056 ------------ 110,720 TOTAL PREFERRED STOCKS (Cost $658,460) $653,603 ------------ RIGHTS & WARRANTS - 0.00% BPI SGPS 4,425 $0 Simco 80 401 ------------ TOTAL RIGHTS AND WARRANTS (Cost $0) $401 ------------ COMMON STOCK UNIT - 0.06% Real Estate - 0.06% AMP Diversified Property Trust* 2,061 $2,521 General Property Trust Units 7,688 10,042 Stockland Trust Group 1,725 3,353
The accompanying notes are an integral part of the financial statements. 95 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Real Estate - continued Westfield Trust AUD 245 $404 Westfield Trust* 7,147 11,518 ------------ TOTAL COMMON STOCK UNIT (Cost $35,150) $27,838 ------------ SHORT TERM INVESTMENTS - 0.00% SSGA Money Market Fund 1,000 $1,000 ------------ Principal Value --------- ----- REPURCHASE AGREEMENT - 4.94% Repurchase Agreement with State Street Bank & Trust Company, dated 10/31/00 at 6.42%, to be repurchased at $2,371,417 on 11/01/00, collateralized by $1,875,000 U.S.Treasury Bonds, 8.50% due 02/15/20 (valued at $2,434,464 including interest) $2,371,000 $2,371,000 ------------ TOTAL INVESTMENTS (International Equity Fund) (Cost $50,146,393) $47,980,421 ------------ - ------------------------------------------------------------------------------- International Small Cap Fund - ------------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 98.11% Aerospace - 0.83% Cobham PLC 7,525 $121,413 Heroux Devtek* 8,775 40,213 Societe Industrielle D'Aviations 650 59,517 ------------ 221,142 Agriculture - 0.97% Nutreco Holding NV 6,000 258,653 ------------ Airlines - 1.10% China Eastern Airlines Corp.* 344,000 49,842 Copenhagen Airport* 1,850 141,342 Flughafen Wien AG 2,825 103,060 ------------ 294,244 Apparel - 1.01% Carli Gry International AS 5,100 76,766 Giordano International* 202,000 118,496 Marzotto SPA 7,750 75,237 ------------ 270,499 Automobiles & Related - 0.64% Torotrak PLC* 13,575 86,665 Westport Innovations, Inc.* 7,600 84,583 ------------ 171,248 Basic Industry - 0.42% Tsubaki Nakashima Co Ltd. 9,000 112,753 ------------ Biotechnology - 4.16% Cambridge Antibody Tech. Group* 5,750 358,747
Shares Value ------ ----- Biotechnology - continued Evotec Biosystems AG* 2,827 $99,308 Genmab A/S* 6,150 161,999 GPC Biotech AG* 144A 2,950 132,679 Lion Bioscience AG* 1,650 127,417 Oxford GlycoSciences Plc* 3,400 124,317 Pharmagene PLC* 17,225 65,731 PyroSequencing AB* 3,700 45,915 ------------ 1,116,113 Building Materials - 0.39% Sarna Kunststoff 100 105,696 ------------ Business Services - 8.80% AIT Group PLC 8,850 218,295 Amey PLC 3,625 87,048 Articon-Integralis AG* 2,694 179,461 BTG PLC* 6,575 162,180 Cosco Pacific Ltd. 92,000 69,169 Datalex PLC ADR* 14,000 161,875 Eyretel PLC* 116,925 324,884 Heyde AG* 4,425 105,142 HiQ International AB 3,150 25,535 Net2S* 1,675 40,936 NetStore plc* 26,650 53,748 Observer AB 3,320 43,526 Poolia AB* 875 36,778 Proffice AB 3,500 115,589 Scipher plc* 7,575 69,243 Siticom Group* 2,175 65,061 The Innovation Group PLC* 8,150 122,982 Trafficmaster PLC* 12,025 101,196 Valtech* 4,525 57,983 Vedior N.V. BDR 144A 21,300 317,220 ------------ 2,357,851 Computer Equipment - 2.02% I-data International A/S* 1,900 203,660 IPC Archtec AG* 625 39,036 Kontron Embedded Computers AG* 400 43,177 Logitech International* 775 237,122 Torex plc 2,175 17,775 ------------ 540,770 Computer Networking - 0.91% NorCom InfoTech AG* 1,375 42,589 Orchestream Ltd.* 25,300 201,900 ------------ 244,489 Computer Software & Services - 7.08% Actinic PLC* 144A 35,725 82,936 CAA AG* 2,175 75,859 COR AG Insurance Tech.* 9,100 193,057 InfoVista SA* 2,225 81,769 Meitec Corporation 3,900 163,699 Micronic Laser Systems AB* 1,300 38,770 Ncipher PLC* 23,400 134,111
The accompanying notes are an integral part of the financial statements. 96 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Computer Software & Services - continued PinkRoccade NV 1,700 $94,492 Pivotal Corporation* 5,900 360,638 Teleplan Int'l N.V* 2,775 98,904 Telework Group* 75,325 271,046 Thiel Logistik AG* 144A 975 150,584 Think Tools AG* 400 153,538 ------------ 1,899,402 Construction - 3.84% Abengoa SA 2,825 80,909 Alliance et Gestion Commerciale* 200 18,584 AMEC PLC 26,150 110,598 George Wimpey PLC 65,825 143,263 Grupo Dragados, S.A. 33,975 330,117 Hunet, Inc. 15,000 126,472 JGC Corp. 14,000 87,376 JM Byggnads och Fastighets 5,325 121,504 Taylor Woodrow PLC 4,000 10,453 ------------ 1,029,276 Consumer Products & Services - 1.29% Zapf Creation AG 3,195 135,428 Arriva PLC 50,650 170,498 Diagonal PLC 10,725 41,238 ------------ 347,164 Distribution - 1.68% A/S Det Ostasiatiske Kompagni* 9,325 195,655 Internatio-Muller NV 13,125 256,171 ------------ 451,827 Diversified - 1.43% CAE, Inc. 16,450 208,923 Ideal Group SA* 8,580 51,888 Royal Canin SA 575 51,966 Shanghai Industrial Hldgs 37,000 70,214 ------------ 382,992 Electronics - 3.39% Densei-Lambda K.K. 4,600 96,119 Egide S.A.* 100 54,310 Imagination Technologies Group* 18,375 88,515 Leica Geosystems AG* 144A 475 134,763 Nanjing Panda Electronics Co., Ltd* 98,000 19,728 Schaffner Holding AG 475 141,369 Volex 11,950 375,386 ------------ 910,191 Environmental Services - 4.73% Boralex, Inc.* 5,900 21,823 Energiekontor AG* 2,400 215,884 Eurofins Scientific* 3,550 115,982 Global Thermoelectric, Inc.* 7,700 161,309 IFX Power PLC 8,625 118,887
Shares Value ------ ----- Environmental Services - continued NEG Micon A/S* 9,300 $482,525 Pennon Group PLC 6,950 68,169 Stuart Energy Systems* 5,500 83,175 ------------ 1,267,754 Financial Services - 5.99% Bank Sarasin & Cie 75 241,989 Credito Emiliano SpA 80,000 307,533 First Capital Corp. 18,000 14,553 Industrial Alliance Life Insurance Co.* 3,200 70,704 Intermediate Capital Group PLC 8,700 104,104 Kempen & Co NV 3,975 244,556 Societe Eurafrance SA 175 105,216 Tecis Holding AG 900 65,071 Van der Moolen Holding N.V. 5,600 452,643 ------------ 1,606,369 Food & Beverages - 1.79% CSM NV 9,025 206,017 Katokichi Co., Ltd. 5,600 161,664 Koninklijke Wessanen NV 5,900 68,843 Oyj Hartwall Abp 2,525 43,711 ------------ 480,235 Healthcare Services - 2.38% Capio AB* 14,000 88,268 MediSolution Ltd.* 21,550 31,179 Oridion Systems Ltd* 6,300 276,168 Rhoen-Klinikum AG 550 29,987 SSL International PLC* 18,300 211,755 ------------ 637,357 Insurance - 0.80% Bayerische Vita Spa 6,350 72,746 Codan A/S 675 48,107 Corporacion Mapfre 5,325 93,765 ------------ 214,618 Leisure & Entertainment - 2.11% Bang & Olufsen Holding 2,575 125,674 Ferretti S.p.A.* 46,000 171,366 NH Hotels, SA 8,800 99,320 Rodriguez Groupe 144A 600 150,202 Wembley PLC 2,075 18,365 ------------ 564,928 Machinery - 3.90% Eneserve Corp. 4,000 157,632 Hoeft & Wessel AG* 5,750 107,348 Neopost SA* 1,775 34,057 Palfinger AG 3,275 97,410 Pinguely-Haulotte SA 8,775 189,885 Swisslog Holding AG 500 275,367 Technotrans AG 1,425 185,016 ------------ 1,046,714
The accompanying notes are an integral part of the financial statements. 97 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Manufacturing - 5.32% Aalberts Industries 900 $21,003 Babcock Borsig AG* 3,175 119,897 Buderus AG 1,300 24,354 Chloride Group PLC 98,455 292,849 Doncaster PLC* 9,475 170,550 Elexis AG 2,000 15,190 FAG Kugelfischer AG 4,900 36,266 Miyachi Technos Corp. 2,760 163,149 Pilkington PLC 35,900 51,237 SIG Schweizerische Industrie 225 132,677 ToshibaTungaloy Co., LTD. 15,000 74,096 Turbo Genset, Inc.* 9,975 324,200 ------------ 1,425,468 Medical Supplies & Equipment - 5.31% AorTech International PLC* 4,975 68,539 Card-Guard Scientific Survival* 5,900 355,293 CyBio AG* 825 99,063 Disetronic Holding AG 400 347,352 Jomed NV* 3,925 240,181 Moritex Corp. 500 24,286 Nobel Biocare 11,700 263,453 Tecan AG 25 26,557 ------------ 1,424,726 Metals & Mining - 0.11% Yanzhou Coal Mining Co. 108,000 29,487 ------------ Oil & Gas - 0.40% ERG Spa 34,200 107,672 ------------ Oil Services - 4.97% Bouygues Offshore SA 4,325 212,871 Technip 1,750 223,946 Comp. Generale de Geophysique SA 2,150 132,276 Expro International Group plc 13,900 101,849 Frontline Ltd.* 144A 12,550 206,935 IHC Caland 925 40,818 Precision Drilling Corp.* 2,825 80,766 Smedvig ASA* 25,525 209,063 Stolt Comex Seaway* 10,300 122,956 ------------ 1,331,480 Paper & Forest Products - 0.42% Holmen AB 1,900 49,432 Metsa Serla 9,000 57,912 Rottneros AB 4,925 4,281 Soporcel-Soc. Portuguesa de Papel* 125 1,812 ------------ 113,438 Pharmaceuticals - 2.65% Actelion Ltd.* 144A 325 143,733 Alliance Unichem PLC 5,275 44,698 Boiron SA 200 12,424 Cerep SA* 1,525 124,882
Shares Value ------ ----- Pharmaceuticals - continued Lavipharm SA 9,760 $47,317 Maxim Pharmaceuticals, Inc* 2,700 118,892 Phytopharm PLC* 4,800 46,697 Powderject Pharmaceuticals PLC* 14,675 134,570 Recordati S.p.A. 2,875 37,572 ------------ 710,784 Photography & Imaging - 0.60% Gretag Imaging Group 900 161,716 ------------ Property - 1.74% Berkeley Group 5,750 53,770 Castellum AB 9,900 105,516 Chelsfield PLC 7,250 38,396 Keppel Land Ltd 69,000 102,932 Minerva PLC 8,750 36,500 Shaftesbury PLC 17,375 62,017 Wihlborgs Fastigheter AB 46,425 66,439 ------------ 465,570 Publishing & Broadcasting - 2.63% Bloomsbury Publishing PLC 3,200 43,761 Elanders AB 3,050 45,480 HIT Entertainment 144A 48,825 329,418 Incepta Group PLC 104,100 212,217 Primacom AG* 3,750 73,192 ------------ 704,067 Retail Trade - 2.97% Charles Voegele Holding AG 850 159,824 Electronics Boutique PLC 39,075 35,151 Gruppo Coin Spa* 12,825 175,221 Iceland Group PLC 80,175 380,980 Ted Baker PLC 7,900 43,901 ------------ 795,078 Semiconductors & Equipment - 2.49% ARC International PLC* 39,350 190,126 Ferrotec Corp. 3,000 57,737 Parthus Technologies PLC* 35,825 122,673 Robotic Technology Systems PLC* 4,400 34,347 Shindengen Electric Manufacturing Co. 14,000 81,474 Silicon-On-Insulator Technologies 7,975 180,695 ------------ 667,052 Telecommunication Services - 1.66% Intec Telecom Systems PLC* 33,075 334,491 Telemetrix PLC 16,250 109,637 ------------ 444,129 Telecommunications Equipment - 3.01% EMTS Technologie AG* 1,000 73,988 Exfo Electro-Optical Engineering, Inc.* 2,575 98,172 Huber & Suhner AG 300 262,850 ITG Group PLC* 144A 12,294 93,373 Linos AG* 725 45,527 Nitsuko Corporation 16,000 70,824
The accompanying notes are an integral part of the financial statements. 98 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Telecommunications Equipment - continued Tandberg ASA* 3,200 $84,837 Tandberg Television ASA* 7,600 76,991 ------------ 806,562 Transportation - 1.16% Autopistas del Mare Nostrum 8,475 128,735 D. Logistics AG* 2,600 183,128 ------------ 311,863 Utilities - 1.01% Grupo Auxiliar Metalurgico*144A 6,850 126,315 Keppel Fels Energy* 19,000 11,900 Sechilienne SA 600 50,916 Viridian Group PLC* 7,475 81,344 ------------ 270,474 ------------ TOTAL COMMON STOCKS (Cost $26,204,625) $26,301,854 ------------ COMMON STOCK UNIT - 0.28% Household Durables - 0.28% Waterford Wedgewood PLC* (Cost $74,163) 61,100 $74,663 ------------ WARRANTS - 0.01% Biotechnology - 0.01% Xenova Group*, Special Warrants (Cost $0) 6,640 3,372 ------------ PREFERRED STOCKS - 0.48% Apparel - 0.48% Hugo Boss AG* (Cost $81,814) 500 127,460 ------------ Principal Value --------- ----- SHORT TERM INVESTMENTS - 1.12% SSGA Money Market Fund (Cost $301,274) $301,274 $301,274 ------------ TOTAL INVESTMENTS (International Small Cap Fund) (Cost $26,661,876) $26,808,623 ------------ - -------------------------------------------------------- Balanced Fund - -------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 65.78% Automobiles - 0.85% General Motors Corp. 9,100 $565,338 ------------ Banks - 5.26% Bank of New York, Inc. 17,600 1,013,100 Chase Manhattan Corp. 13,400 609,700 Morgan, J.P. & Co., Inc. 5,900 976,450 Wells Fargo & Company 19,700 912,356 ------------ 3,511,606 Biotechnology - 1.28% Genentech, Inc.* 10,400 858,000 ------------
Shares Value ------ ----- Communications Equipment - 3.57% Cisco Systems, Inc.* 16,400 $883,550 Corning, Inc. 11,200 856,800 Crown Castle International Corp.* 21,200 642,625 ------------ 2,382,975 Computers & Peripherals - 3.76% Compaq Computer Corp. 25,600 778,496 EMC Corp.* 10,700 952,969 Intuit* 12,700 780,256 ------------ 2,511,721 Diversified Financial - 4.34% Citigroup, Inc. 17,933 943,724 Morgan Stanley Dean Witter 11,900 955,719 Stilwell Financial, Inc. 22,300 999,319 ------------ 2,898,762 Electronic Equipment & Supplies - 1.88% Palm, Inc.* 14,700 787,369 SDL, Inc.* 1,800 466,650 ------------ 1,254,019 Energy Equipment & Services - 1.05% Schlumberger, Ltd. 9,200 700,350 ------------ Health Care Equipment & Supplies - 0.84% Guidant Corp.* 10,600 561,138 ------------ Hotels, Restaurants & Leisure - 1.45% Harrah's Entertainment, Inc.* 33,800 967,525 ------------ Industrial Conglomerates - 2.87% General Electric Co. 15,000 822,187 Minnesota Mining & Manufacturing Co. 8,200 792,325 Monsanto Co.* 12,000 306,000 ------------ 1,920,512 Insurance - 1.41% Allmerica Financial Corp. 15,000 945,937 ------------ Internet Software & Services - 1.56% America Online, Inc.* 20,700 1,043,901 ------------ Media - 2.52% AT & T Corp. - Liberty Media* 33,000 594,000 General Motors Hughes 33,700 1,091,880 ------------ 1,685,880 Multiline Retail - 2.16% Target Corp. 27,000 745,875 Wal-Mart Stores, Inc. 15,300 694,238 ------------ 1,440,113 Non-ferrous Metals - 0.74% Alcoa, Inc. 17,200 493,425 ------------ Oil & Gas - 5.97% Apache Corp. 11,800 652,687 Canadian Natural Resources Ltd.* 14,000 411,249 Coastal Corp. 11,100 837,356 Duke Energy Co. 4,600 397,612
The accompanying notes are an integral part of the financial statements. 99 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Oil & Gas - continued ExxonMobil Corp. 10,296 $918,274 Unocal Corp. 22,900 781,462 ------------ 3,998,640 Personal Products - 1.34% Gillette Company 25,600 892,800 ------------ Pharmaceuticals - 6.85% American Home Products 15,800 1,003,300 Merck & Co., Inc. 9,600 863,400 Pfizer, Inc. 22,800 984,675 Pharmacia Corp. 16,800 924,000 Teva Pharmaceutical Industries 13,500 798,188 ------------ 4,573,563 Road & Rail - 0.37% Norfolk Southern Corp. 17,600 248,600 ------------ Semiconductor Equipment & Products - 2.30% Intel Corp. 15,300 688,500 Maxim Integrated Products, Inc.* 12,800 848,800 ------------ 1,537,300 Software - 2.54% Amdocs Ltd.* 12,100 784,231 Sun Microsystems, Inc.* 8,200 909,175 ------------ 1,693,406 Specialty Retail - 1.68% Radio Shack Corp. 18,800 1,120,950 ------------ Telecommunications - 9.19% Echostar Communications Corp.* 14,400 651,600 Nextel Communications, Inc.* 20,200 776,438 Omnicom Group 9,900 913,275 Qwest Communications Int'l., Inc.* 18,718 910,163 Redback Networks, Inc.* 6,000 638,625 SBC Communications., Inc. 19,400 1,119,138 Verizon Communications 19,500 1,127,344 ------------ 6,136,583 ------------ TOTAL COMMON STOCKS (Cost $40,439,260) $43,943,045 ------------ Principal Value --------- ----- CORPORATE BONDS - 17.74% Beverages - 0.73% Jos. E. Seagram & Sons, 7.60% due 12/15/28 $450,000 $492,017 ------------ Consumer Services - 1.42% Hertz Corporation, 6.50% due 05/15/06 1,000,000 946,870 ------------ Electric & Gas Utilities - 9.92% Commonwealth Edison Co., 8.375% due 09/15/22 1,250,000 1,257,933 Consumers Energy Co., 7.375% due 09/15/23 500,000 444,872
Principal Value --------- ----- Electric & Gas Utilities - continued El Paso Electric Co., 9.40% due 05/01/11 $600,000 $630,060 Indiana & Michigan Power Co., 8.50% due 12/15/22 1,000,000 1,014,130 Niagara Mohawk Power Corp., 8.75% due 04/01/22 225,000 236,425 Niagara Mohawk Power Corp., 8.50% due 07/01/23 250,000 253,333 NRG Northeast Generating LLC 9.292% due 12/15/24 500,000 512,745 Pennsylvania Power Co., 8.50% due 07/15/22 1,000,000 1,002,880 Texas Electric Utilities Co., 8.50% due 08/01/24 1,000,000 1,029,150 Texas Electric Utilities Co., 7.875% due 04/01/24 250,000 242,430 ------------ 6,623,958 Telecommunications - 5.67% Esat Holdings, Zero Coupon due 02/01/07 750,000 723,750 Esat Telecommunications Group Plc, 11.875% due 12/01/08 500,000 584,370 Metronet Communications Corp., Zero Coupon due 06/15/08 1,500,000 1,200,255 Rogers Cantel Mobile, Inc., 9.75% due 06/01/16 250,000 266,250 Worldcom, Inc. 7.75% due 04/01/07 1,000,000 1,011,880 ------------ 3,786,505 ------------ TOTAL CORPORATE BONDS (Cost $13,119,927) $11,849,350 ------------ U.S. TREASURY OBLIGATIONS - 3.12% U.S. Treasury Notes - 3.12% 7.25% due 05/15/04 $2,000,000 $2,085,620 ------------ TOTAL U.S. TREASURY OBLIGATIONS (Cost $2,079,573) $2,085,620 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 8.47% Federal Home Loan Banks - 0.29% 5.125% due 09/15/03 200,000 $193,032 ------------ Federal Home Loan Mortgage Corporation - 2.27% 6.45% due 03/10/04 500,000 502,219 6.875% due 01/15/05 1,000,000 1,012,810 ------------ 1,515,029 Federal National Mortgage Association - 2.48% 6.00% due 05/15/08 400,000 384,188 6.25% due 05/15/29 250,000 233,750 7.25% due 01/15/10 1,000,000 1,036,560 ------------ 1,654,498
The accompanying notes are an integral part of the financial statements. 100 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Government National Mortgage Corporation - 1.64% 6.50% due 06/15/29 $250,000 $231,001 7.00% due 11/15/28 533,474 452,986 7.00% due 12/15/22 375,000 177,699 8.00% due 04/15/30 250,000 236,569 ------------ 1,098,255 Resolution Funding FBE Strips - 1.79% Zero Coupon due 04/15/09 2,000,000 1,193,640 ------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $4,385,925) $5,654,454 ------------ SHORT TERM INVESTMENTS - 0.00% SSGA Money Market Fund 1,000 $1,000 ------------ REPURCHASE AGREEMENT - 4.89% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $3,267,575 on 11/01/00, collateralized by $3,350,000 U.S. Treasury Notes, 5.50% due 05/15/09 (valued at $3,345,040, including interest) (Cost $3,267,000) $3,267,000 $3,267,000 ------------ TOTAL INVESTMENTS (Balanced Fund) (Cost $63,292,685) $66,800,468 ------------ - ----------------------------------------------------------------- Core Bond Fund - ----------------------------------------------------------------- Principal Value --------- ----- CORPORATE BONDS - 34.59% Aerospace & Defense - 0.01% Raytheon Company, 6.75% due 08/15/07 $40,000 $38,399 ------------ Automobiles - 0.63% Daimler Chrysler, 7.125% due 04/10/03 2,725,000 2,733,284 ------------ Banking - 6.13% Asian Development Bank, 6.375% due 10/01/28 2,730,000 2,717,633 Asian Development Bank, 6.50% due 10/21/02 4,300,000 4,297,162 Bank of America, 7.80% due 02/15/10 2,820,000 2,863,879 Bank One Corp, 7.875% due 08/01/10 2,820,000 2,831,647 Corporacion Andina de Fomento, 8.875% due 06/01/05 3,280,000 3,443,065 First Financial Caribbean Corp., 7.84% due 10/10/06 135,000 130,309 First Union Corp., 6.95% due 11/01/04 3,300,000 3,252,678
Principal Value --------- ----- Banking - continued First Union National Bank, 7.80% due 08/18/10 $3,385,000 $3,373,017 Inter-american Development Bank, 7.00% due 06/16/03 2,730,000 2,765,463 NBD Bancorp, 8.25% due 11/01/24 300,000 318,390 Royal Bank of Scotland Group Plc, 6.40% due 04/01/09 150,000 138,416 U.S. Bancorp, 7.50% due 06/01/26 300,000 302,532 Western Financial Savings, 8.875% due 08/01/07 25,000 22,594 ------------ 26,456,785 Chemical Products - 0.02% Arco Chemical Co., 9.80% due 02/01/20 5,000 4,850 ICI North America, Inc., 8.875% due 11/15/06 65,000 67,398 ------------ 72,248 Diversified Manufacturing - 1.37% Tyco International Group SA, 6.875% due 09/05/02 5,945,000 5,927,890 ------------ Drugs & Health Care - 0.14% Allegiance Corp., 7.00% due 10/15/26 325,000 318,718 Mediq/PRN Life Support Services, 11.0% due 06/01/08 10,000 300 McKesson Corp., 6.3% due 03/01/05 315,000 274,050 ------------ 593,068 Financial Services - 14.91% AAG Holding, Inc., 6.875% due 06/01/08 100,000 89,681 Amvescap Plc, 6.60% due 05/15/05 150,000 143,367 Associates Corp. of North America, 5.75% due 11/01/03 270,000 260,604 Associates Corp. of North America, 5.80% due 04/20/04 250,000 240,150 BanPonce Financial Corp., 6.75% due 08/09/01 250,000 249,312 Beneficial Corp., 8.40% due 05/15/08 75,000 77,262 Countrywide Funding Corp., 6.25% due 04/15/09 4,715,000 4,252,128 EOP Operating LP, 6.50% due 01/15/04 95,000 92,101 Fairfax Financial Holdings Ltd., 8.25% due 10/01/15 2,935,000 2,487,823 Fairfax Financial Holdings Ltd., 7.375% due 03/15/06 3,780,000 3,258,889
The accompanying notes are an integral part of the financial statements. 101 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Financial Services - continued Ford Motor Credit Corp., 5.80% due 01/12/09 $150,000 $131,792 Ford Motor Credit Corp., 7.50% due 03/15/05 4,665,000 4,679,835 Heller Financial, Inc., 7.375% due 11/01/09 3,270,000 3,139,004 Heller Financial, Inc., 7.875% due 05/15/03 2,720,000 2,759,739 Household Finance Corp., 6.40% due 06/17/08 150,000 139,575 Household Finance Corp., 8.00% due 05/09/05 4,090,000 4,182,557 International Finance Corp., 7.125% due 04/06/05 2,840,000 2,847,554 KFW International Finance, Inc., 7.125% due 02/15/05/\ 13,900,000 14,181,614 Lehman Brothers Holdings, 7.75% due 01/15/05 5,775,000 5,825,242 Merrill Lynch & Company, 7.20% due 10/15/12 1,000,000 971,680 Potomac Capital Investment Corp., 144A 7.55% due 11/19/01 4,950,000 4,985,655 Qwest Capital Funding, Inc., 144A 7.90% due 08/15/10 2,820,000 2,860,636 Speer Leeds & Kellogg LP, 8.25% due 08/15/05 2,820,000 2,895,266 Sun Canada Financial Co., 7.25% due 12/15/15, 144A 200,000 191,716 U.S. West Capital Funding, Inc., 6.875% due 07/15/28 3,950,000 3,469,996 ------------ 64,413,178 Food & Beverages - 0.02% Joseph E. Seagram & Sons, Inc., 7.50% due 12/15/18 65,000 69,709 ------------ Food-Meat Products - 0.63% IBP, Inc., 7.95% due 02/01/10 3,460,000 2,727,321 ------------ Industrials - 0.06% K & F Industries, Inc., 9.25% due 10/15/07 10,000 9,588 SCL Aereo Santiago, 6.95% due 07/01/12, 144A 100,000 92,071 WMX Technologies, Inc., 7.10% due 08/01/26 150,000 145,461 ------------ 247,120 Insurance - 0.07% Florida Windstorm Underwriting, 7.125% due 02/25/19, 144A 180,000 171,331 Ohio National Life Insurance Co., 8.50% due 05/15/26, 144A 150,000 145,662 ------------ 316,993
Principal Value --------- ----- Oil & Gas - 2.02% Enron Corp., 6.75% due 09/01/04 $3,775,000 $3,739,062 Pennzoil Company, 10.25% due 11/01/05 205,000 227,462 Pennzoil Company, 10.125% due 11/15/09 625,000 724,050 Williams Companies, Inc., 7.625% due 07/15/19 4,160,000 4,034,285 ------------ 8,724,859 Paper & Forest Products - 0.00% Domtar, Inc., 9.50% due 08/01/16 10,000 10,529 ------------ Real Estate - 0.00% Grove Worldwide LLC, 9.25% due 05/01/08 15,000 2,100 ------------ Telecommunication Services - 4.86% American Telephone & Telegraph Corp., 6.50% due 03/15/29 5,595,000 4,394,089 Deutsche Telekom International, 8.00% due 06/15/10 2,730,000 2,782,634 Deutsche Telekom International, 8.25% due 06/15/30 2,730,000 2,786,020 GST Telecommunications, Inc., 12.75% 11/15/07 20,000 50 Hyperion Telecommunications, Inc., 13.00 % due 04/15/03 10,000 7,800 Iridium Operations LLC, 11.25% due 07/15/05 25,000 625 KMC Telecom. Holdings, Inc., Step-up due 02/15/08* 50,000 5,000 Metronet Communications Corp., Step-up due 06/15/08 3,910,000 3,128,665 Northwestern Bell Telephone Co., 7.75% due 05/01/30 1,835,000 1,841,881 Royal KPN NV, 144A 8.00% due 10/01/10 1,410,000 1,384,325 Tele-Communications, Inc., 9.25% due 04/15/02 200,000 204,738 Telefonica Europe BV, 7.75% due 09/15/10 2,820,000 2,831,054 Vodafone Airtouch Plc, 144A 7.875% due 02/15/30 1,615,000 1,606,909 ------------ 20,973,790 Transportation - 0.01% Southern Railway Company, 8.75% due 10/15/03 30,000 31,175 ------------ Utilities - 3.71% Appalachian Power Company, 8.00% due 06/01/25 2,885,000 2,953,086 Cinergy Corp., 6.125% due 04/15/04 2,940,000 2,768,051
The accompanying notes are an integral part of the financial statements. 102 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Utilities - continued Edison International, 6.875% due 09/15/04 $2,890,000 $2,811,016 GCI, Inc., 9.75% due 08/01/07 25,000 23,000 Osprey, 144A 7.797% due 01/15/03 4,230,000 4,231,687 Pennsylvania Electric Company, 6.625% due 04/01/19 3,675,000 3,250,317 ------------ 16,037,157 ------------ TOTAL CORPORATE BONDS (Cost $150,005,968) $149,375,605 ------------ U.S. TREASURY OBLIGATIONS - 6.77% U.S. Treasury Bonds - 2.46% 6.125% due 08/15/29 8,710,000 $9,020,250 7.50% due 11/15/16 1,210,000 1,393,956 12.00% due 08/15/13 150,000 205,008 ------------ 10,619,214 U.S. Treasury Notes - 4.31% 5.75% due 08/15/10 8,595,000 8,586,921 6.75% due 05/15/05 5,640,000 5,847,101 6.875% due 05/15/06 4,000,000 4,191,240 ------------ 18,625,262 ------------ TOTAL U.S. TREASURY OBLIGATIONS (Cost $29,142,983) $29,244,476 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 33.47% Federal Farm Credit Banks - 1.28% 6.75% due 07/07/09 $5,540,000 $5,514,904 ------------ Federal Home Loan Banks - 2.79% 5.125% due 09/15/03 400,000 386,064 5.315% due 12/23/08 4,000,000 3,628,120 5.805% due 03/23/09 3,780,000 3,537,853 6.01% due 12/03/08 900,000 839,529 6.70% due 05/07/03 2,300,000 2,288,500 7.00% due 08/01/29 1,302,519 1,276,872 7.00% due 02/01/12 109,706 109,260 ------------ 12,066,198 Federal Home Loan Mortgage Corp. - 5.92% 6.00% due 05/18/08 1,500,000 1,440,705 6.25% due 05/15/29 1,000,000 935,000 6.50% due 06/15/23 100,000 95,593 6.50% TBA 150,000 146,907 6.625% due 09/15/09 15,035,000 14,941,031 8.00% TBA 7,900,000 8,006,176 ------------ 25,565,412 Federal National Mortgage Association - 18.56% 6.18% due 07/01/08 19,504 18,768 6.27% due 11/01/07 53,505 51,872 6.28% due 02/12/08 3,780,000 3,658,927
Principal Value --------- ----- Federal National Mortgage Association - continued 6.295% due 06/01/08 $19,507 18,897 6.30% due 01/01/08 19,416 18,840 6.305% due 02/01/08 194,179 182,004 6.34% due 01/01/08 19,122 18,609 6.37% due 01/30/08 2,050,000 1,991,390 6.39% due 01/01/06 18,981 18,640 6.43% due 01/01/08 19,414 18,968 6.50% TBA 34,325,000 33,233,206 6.50% due 04/01/29 458,094 440,197 6.650% due 11/07/07 4,000,000 3,925,640 6.981% due 06/01/07 18,580 18,719 7.00% TBA 21,950,000 21,504,195 7.00% due 09/01/10 - 10/01/28 655,563 644,709 7.04% due 03/01/07 19,334 19,478 7.125% due 06/15/10 11,095,000 11,429,625 7.28% due 10/01/06 19,291 19,641 7.50% TBA 2,925,000 2,945,124 ------------ 80,177,449 Government National Mortgage Association - 4.92% 6.50% due 06/15/29 957,212 924,006 7.00% due 12/15/22 - 08/15/29 1,503,825 1,484,054 7.50% TBA 16,900,000 16,958,136 8.00% due 04/15/30 1,861,723 1,892,553 ------------ 21,258,749 ------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $146,428,961) $144,582,712 ------------ FIXED INCOME - OTHER - 5.71% Auto Loans Receivable - 2.81% Aesop Funding II LLC, 6.40% due 10/20/03, 144A $100,000 $99,299 Americredit Automobile Rec, 7.05% due 02/12/05 2,820,000 2,833,048 Associates Automobile Rec, 6.99% due 07/15/08 3,950,000 3,983,328 Daimler Chrysler, 6.70% due 03/08/06 1,000,000 999,890 Ford Motor Credit Corp., 6.58% due 11/15/04 4,230,000 4,225,373 ------------ 12,140,938 Credit Cards Receivable - 0.65% Discover Card, 5.60% due 05/16/06 150,000 145,171 Fleet Credit Card, 6.90% due 04/16/07 2,640,000 2,656,500 ------------ 2,801,671 Other Asset Backed Securities - 2.25% Continental Airlines, 6.90% due 01/02/18 100,000 90,057 Continental Airlines pass-through, 6.648% due 09/15/17 70,000 61,166
The accompanying notes are an integral part of the financial statements. 103 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Other Asset Backed Securities - continued Continental Airlines pass-through, 7.08% due 11/01/04 $133,276 $131,620 P P & L Transition, 7.05% due 06/25/09 2,820,000 2,831,449 Peco Energy Trans, 6.13% due 03/01/09 3,780,000 3,555,544 United Airlines pass-through, 7.73% due 07/01/10 2,820,000 2,832,887 First Union Lehman Bros., Series 1997, Class A2, 6.60% due 05/18/07 200,000 197,317 ------------ 9,700,040 ------------ TOTAL FIXED INCOME - OTHER (Cost $24,737,390) $24,642,649 ------------ Shares Value ------ ----- COMMON STOCKS - 0.00% Telecommunication Services - 0.00% Decisionone Corp. 23 $5 SF Holdings Group, Inc., 144A 7 0 ------------ TOTAL COMMON STOCKS (Cost $10,089) $5 ------------ PREFERRED STOCKS - 0.01% Concentric Network, PIK 13.5% 5 $0 Fairfield Mfg. Co., Inc., PIK 11.25% 25 20,313 Primedia, Inc., 8.625% 145 12,216 SF Holdings Group, Inc.*, 13.75% 2 8,050 XO Communications, Inc. 5 3,750 ------------ TOTAL PREFERRED STOCKS (Cost $61,097) $44,329 ------------ WARRANTS - 0.00% Concentric Network Corp.*, Exp. 12/15/07, 144A 5 $2,151 KMC Telecom. Holdings, Inc.*, Exp. 04/15/08, 144A 50 103 Motient Corp.*, Exp. 04/01/2008 5 176 ------------ TOTAL WARRANTS (Cost $0) $2,430 ------------ Principal Value --------- ----- CORPORATE SHORT-TERM COMMERCIAL PAPER - 19.45% Albertson's, Inc., 6.52% due 11/01/00 $4,532,000 $4,532,000 Aon Corporation, 6.54% due 11/17/00 5,000,000 4,985,467 Connectiv, Inc., 6.73% due 11/13/00 7,474,000 7,457,233 Connectiv, Inc., 6.74% due 11/21/00 6,500,000 6,475,661
Principal Value --------- ----- CORPORATE SHORT-TERM COMMERCIAL PAPER - continued Dow Corning Corp., 6.64% due 11/01/00 $3,680,000 $3,680,000 Govco, Inc., 6.50% due 11/17/00 10,000,000 9,971,111 Harley Davidson Dealer Funding, 6.50% due 11/16/00 9,250,000 9,224,948 Harley Davidson Dealer Funding, 6.49% due 11/17/00 4,192,000 4,179,908 Merrill Lynch & Co., Inc., 6.47% due 11/03/00 7,165,000 7,162,425 Omnicom Finance, Inc., 6.57% due 11/17/00 14,000,000 13,959,120 Safeway, Inc., 6.65% due 11/16/00 5,415,000 5,399,996 Snap-on Tools Corp., 6.47% due 11/16/00 7,000,000 6,981,129 ------------ TOTAL CORPORATE SHORT-TERM COMMERCIAL PAPER (Cost $84,008,998) $84,008,998 ------------ TOTAL INVESTMENTS (Core Bond Fund) (Cost $434,395,486) $431,901,204 ------------ - --------------------------------------------------------------- High Yield Bond Fund - --------------------------------------------------------------- Principal Value --------- ----- CORPORATE BONDS - 88.07% Aerospace & Defense - 0.38% K & F Industries, 9.25% due 10/15/07 $250,000 $239,688 ------------ Airlines - 1.40% Aircraft Service International Group, 11.00% due 08/15/05 800,000 632,000 Atlas Air, Inc., 9.702% due 07/02/11 250,000 253,875 ------------ 885,875 Auto Related - 2.70% Pep Boys-Manny Moe & Jack, 6.52% due 07/16/07 750,000 627,787 Prestolite Electric, Inc., 9.625% due 02/01/08 800,000 480,000 Stanadyne Automotive Corp., 10.25% due 12/15/07 750,000 600,000 ------------ 1,707,787 Banks - 1.09% Western Financial Bank: 8.50% due 07/01/03 500,000 466,310 8.875% due 08/01/07 250,000 225,938 ------------ 692,248
The accompanying notes are an integral part of the financial statements. 104 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Building Products - 0.12% Oglebay Norton Co., 10.00% due 02/01/09 $85,000 $75,650 ------------ Business & Commercial Services - 2.13% Americredit Corp., 9.25% due 02/01/04 375,000 361,875 Anthony Crane Rental, 10.375% due 08/01/08 1,500,000 630,000 Integrated Electrical Services, 9.375% due 02/01/09 300,000 267,000 Pierce Leahy Corp., 8.125% due 05/15/08 100,000 92,875 ------------ 1,351,750 Chemicals - 2.45% Borden Chemical & Plastics, 9.50% due 05/01/05 1,000,000 580,000 Geo Specialty Chemicals, Inc., 10.125% due 08/01/08 350,000 269,500 Koppers Industries, Inc., 9.875% due 12/01/07 350,000 323,750 Royster-Clark, Inc., 10.25% due 04/01/09 500,000 380,000 ------------ 1,553,250 Containers-Paper - 1.02% Packaged Ice, Inc., Series B, 9.75% due 02/01/05 750,000 645,000 ------------ Financial Services - 3.36% Charter Communications Holding, 10.25% due 01/15/10 1,000,000 972,500 Ono Finance Company Plc., 13.00% due 05/01/09 1,500,000 1,155,000 ------------ 2,127,500 Electronic Equipment & Services - 1.65% Flextronics International, Inc., 9.875% due 07/01/10 375,000 378,750 Metromedia Fiber Network, Inc., 10.00% due 12/15/09 750,000 667,500 ------------ 1,046,250 Food & Drug Distribution - 2.02% Agrilink Foods, Inc., 11.875% due 11/01/08 1,000,000 715,000 Pharmerica, Inc., 8.375 due 04/01/08 750,000 562,500 ------------ 1,277,500 Health Care Providers & Services - 4.53% Iasis Healthcare Corp., 13.00% due 10/15/09 1,170,000 1,076,400 Lifepoint Hospitals Holdings, Inc., 10.75% due 05/15/09 230,000 244,950
Principal Value --------- ----- Health Care Providers & Services - continued Manor Care, Inc., 7.50% due 06/15/06 $250,000 $206,482 Medpartners, Inc., 7.375% due 10/01/06 200,000 176,500 Omega Healthcare Investments, Inc., 6.95% due 06/15/02 500,000 444,085 Universal Hospital Services, Inc., 10.25% due 03/01/08 1,000,000 720,000 ------------ 2,868,417 Home Builders - 1.20% Beazer Homes USA, Inc.: 8.875% due 04/01/08 450,000 423,000 9.00% due 03/01/04 350,000 337,313 ------------ 760,313 Household Products - 1.17% Sealy Mattress Company, 10.88% due 12/15/07 750,000 570,000 Sleepmaster LLC, 11.00% due 05/15/09 200,000 170,000 ------------ 740,000 Hotels, Restaurants & Leisure - 8.62% Apple South, Inc., 9.75% due 06/01/06 180,000 135,000 Cinemark USA, Inc. Series B 9.625% due 08/01/08 100,000 45,000 Cinemark USA, Inc. Series D 9.625% due 08/01/08 200,000 84,000 Crown Castle International: 10.38% due 05/15/11 350,000 224,000 10.63% due 11/15/07 350,000 273,000 Harveys Casino Resorts, 10.625% due 06/01/06 550,000 565,125 Hollywood Casino Shreveport, 13.00% due 08/01/06, 144A 1,000,000 1,070,000 Hollywood Park, Inc. Series B: 9.25% due 02/15/07 500,000 537,500 9.50% due 08/01/07 350,000 360,500 Isle of Capri Casinos, Inc., 8.75% due 04/15/09 650,000 589,875 Prime Hospitality Corp., 9.75% due 04/01/07 800,000 805,000 Riviera Black Hawk, Inc., 13.00% due 05/01/05 750,000 766,875 ------------ 5,455,875 Internet Services - 0.78% Globix Corp., 12.50% due 02/01/10 775,000 496,000 ------------
The accompanying notes are an integral part of the financial statements. 105 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Machinery - 1.37% Calpine Corp., 7.75% due 04/15/09 $200,000 $188,062 Lennar Corp., 9.95% due 05/01/10 400,000 408,000 Penhall International Corp., 12.00% due 08/01/06 300,000 273,000 ------------ 869,062 Media - 3.84% Coaxial Communications Center, Inc., 10.00% due 08/15/06 600,000 579,000 Cumulus Media, Inc., 10.375% due 07/01/08 1,094,000 908,020 Echostar DBS Corp., 9.375% due 02/01/09 75,000 73,781 Golden Sky DBS, Inc., 13.50% due 03/01/07 400,000 272,000 Regional Independent Media Group, 10.50% due 07/01/08 150,000 156,000 Spanish Broadcasting System, Inc., 9.625% due 11/01/09 200,000 193,500 Transwestern Publishing Company, 9.625% due 11/15/07 250,000 248,125 ------------ 2,430,426 Merchandising - 2.27% Big 5 Corporation Series B, 10.875% due 11/15/07 250,000 223,750 Shop At Home, Inc., 11.00% due 04/01/05 500,000 480,000 True Temper Sports, Inc., 10.875% due 12/01/08 750,000 735,000 ------------ 1,438,750 Metals - 2.41% Metals USA, Inc., 8.625% due 02/15/08 300,000 192,000 Renco Steel Holdings, Inc., 10.875% due 02/01/05 300,000 252,000 Russel Metals, Inc. 10.00% due 06/01/09 300,000 276,000 WCI Steel, Inc., 10.00% due 12/01/04 1,000,000 805,000 ------------ 1,525,000 Natural Gas - 0.88% Leviathan Gas Pipeline Ptnr. Co. Series B, 10.375% due 06/01/09 530,000 556,500 ------------ Oil-Integrated Domestic - 0.61% Tesoro Petroleum Corp., 9.00% due 07/01/08 400,000 385,000 ------------ Oil-Service/Products - 0.50% Triton Energy, Ltd., 9.25% due 04/15/05 315,000 319,725 ------------
Principal Value --------- ----- Oil & Gas Producers - 4.47% Frontier Oil Corp., 11.75% due 11/15/09 $850,000 $862,750 Grey Wolf, Inc., 144A 8.875% due 07/01/07 500,000 485,000 8.875% due 07/01/07 225,000 218,250 HS Resources, Inc., 9.25% due 11/15/06 625,000 618,750 HS Resources, Inc. Series B, 9.25% due 11/15/06 650,000 648,375 ------------ 2,833,125 Other - 1.95% Ekabel Hessen, 14.50% due 09/01/10 144A 500,000 470,000 RB Falcon Corp., 9.50% due 12/15/08 25,000 26,250 United Pan Europe: 11.25% due 02/01/10 200,000 151,000 13.75% due 02/01/10 144A 1,500,000 585,000 ------------ 1,232,250 Paper & Forest Products - 1.65% Bear Island Paper Company LLC 10.00% due 12/01/07 1,200,000 1,044,000 ------------ Pharmaceuticals - 2.73% ICN Pharmaceuticals, Inc., 8.75% due 11/15/08 144A 1,425,000 1,414,312 King Pharmaceuticals, Inc., 10.75% due 02/15/09 300,000 316,500 ------------ 1,730,812 Pollution Control - 0.67% Allied Waste of North America, Inc., 10.00% due 08/01/09 500,000 422,500 ------------ Real Estate - 1.14% Grove Worldwide LLC, 9.25% due 05/01/08 900,000 126,000 Meditrust Companies: 7.00% due 08/15/07 200,000 140,000 7.51% due 09/26/03 650,000 454,249 ------------ 720,249 Schools - 1.44% KinderCare Learning Centers, Inc., 9.50% due 02/15/09 1,000,000 912,500 ------------ Telecommunications - 24.28% Benedek Communications Corp., 13.25% due 05/15/06 1,350,000 1,147,500 Concentric Network Corp., 12.75% due 12/15/07 1,170,000 1,105,650 Condor Systems, Inc., 11.875% due 05/01/09 500,000 330,000 Covad Communications Group, 12.00% due 02/15/10 1,000,000 480,000
The accompanying notes are an integral part of the financial statements. 106 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Telecommunications - continued Energis Plc., 9.75% due 06/15/09 $630,000 $601,650 ESAT Holdings Series B, 12.50% due 02/01/07 600,000 579,000 Exodus Communications, Inc., 11.625% due 07/15/10 1,000,000 935,000 Frontiervision Holding, 11.875% due 09/15/07 1,000,000 855,000 Global Crossings Holdings, Ltd., 9.625% due 05/15/08 1,000,000 955,000 GT Group Telecommunications, Inc., 13.25% due 02/01/10, 144A 1,200,000 438,000 Level 3 Communications, Inc., 12.88% due 03/15/10 144A 750,000 371,250 Level 3 Communications, Inc., 11.00% due 03/15/08 500,000 452,500 Microcell Telecommunications, 12.00% due 06/01/09 1,500,000 1,057,500 National Communications Corp., 11.50% due 10/01/08 700,000 644,000 Netia Holdings B.V.: 10.25% due 11/01/07 250,000 187,500 11.25% due 11/01/07 500,000 320,000 Netia Holdings II B.V., 13.125% due 06/15/09 150,000 129,000 Nextlink Communications, Inc., 13.13% due 12/01/09 144A 500,000 240,000 Nextel Communications, 9.375% due 11/15/09 250,000 242,500 North Point Communications, 12.875% due 02/15/10 1,000,000 930,000 Orbvcom Global Series B, 14.00% due 08/15/04 500,000 75,000 Pegasus Communications Corp. Series B, 9.625% due 10/15/05 100,000 97,500 Pegasus Communications Corp., 9.75% Step up, due 12/01/06 75,000 73,125 PSI Net, Inc., 11.00% due 08/01/09 1,000,000 485,000 Spectrasite Holdings, Inc., 12.88% due 03/15/10 144A 1,000,000 485,000 Telewest Communications Plc., 9.25% due 04/15/09 1,000,000 490,000 11.00% Step up, due 10/01/07 400,000 352,000 Versatel Telecommunications B.V., 13.25% due 05/15/08 650,000 484,250 Versatel Telecommunications Int'l., 13.25% due 05/15/08 150,000 114,000 Williams Communications Group, 10.875% due 10/01/09 50,000 42,125 Williams Communications Group, 11.70% due 08/01/08 144A 450,000 401,625
Principal Value --------- ----- Telecommunications - continued WinStar Communications, Inc: 12.75% due 04/15/10 144A $50,000 $35,750 14.75% due 04/15/10 144A 750,000 236,250 ------------ 15,372,675 Textiles & Apparel - 1.07% Anvil Knitwear, Inc. Series B, 10.875% due 03/15/07 300,000 256,500 Galey & Lord, Inc., 9.125% due 03/01/08 675,000 418,500 ------------ 675,000 Utilities-Electric - 2.17% Caithness Cosco Funding Corp., 9.05% due 12/15/09 1,375,000 1,375,000 ------------ TOTAL CORPORATE BONDS (Cost $62,390,193) 0 $55,765,677 ------------ Shares Value ------ ----- PREFERRED STOCK - 0.91% Adelphia Communications Corp., Exchangeable Series B, 13.00% (Cost $603,500) 6,000 $574,500 ------------ WARRANTS - 0.15% GT Group Telecommunications, Inc., Exp. 02/01/10, 144A 1,200 $60,600 Ono Finance Company 500 36,125 ------------ TOTAL WARRANTS (Cost $58,479) $96,725 ------------ PUT OPTIONS - 0.15% Meditrust Exercisable Put Option, 7.114%, Exp. 08/15/04 (Cost $71,919) 150,000 $94,500 ------------ Principal Value --------- ----- REPURCHASE AGREEMENT - 10.72% Repurchase Agreement with State Street Bank & Trust, dated 10/31/00 at 6.42%, to be repurchased at $6,788,210 on 11/01/00, collateralized by $6,315,000 U.S. Treasury Note, 7.875% due 11/15/04 (valued at $6,993,034, including interest) (Cost $6,787,000) $6,787,000 $6,787,000 ------------ TOTAL INVESTMENTS (High Yield Bond Fund) (Cost $69,911,091) $63,318,402 ------------
The accompanying notes are an integral part of the financial statements. 107 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Municipal Bond Fund - --------------------------------------------------------------------------------
Principal Value --------- ----- LONG-TERM INVESTMENTS - 99.39% Alabama - 0.80% Alabama Housing Finance Authority Single Family Mortgage Revenue Collateralized Home Mortgage Program, Series B-2, 6.40%, 04/01/25 $130,000 $131,551 ------------ Alaska - 1.37% Anchorage, Alaska, Lease Revenue Bonds, 5.88%, 02/01/13 215,000 226,984 ------------ Arkansas - 1.54% Camden, Arkansas, Pollution Control, (International Paper Company Project), 5.70%, 09/01/12 250,000 254,025 ------------ California - 6.14% California Housing Finance Agency Revenue, Series H 6.15%, 08/01/16 1,000,000 1,014,020 ------------ Colorado - 8.73% Colorado Health Facilities Authority, 5.25%, 09/01/18 250,000 211,105 Denver, Colorado, City & County Airport, 6.00%, 11/15/15 750,000 783,322 El Paso County, Colorado, Single Family Prerefunded, Zero Coupon, 09/01/15 1,000,000 448,460 ------------ 1,442,887 District of Columbia - 1.58% District of Columbia Refunding, 5.50%, 06/01/09 250,000 261,465 ------------ Hawaii - 1.35% Honolulu, Hawaii, City & County, 5.25%, 07/01/15 225,000 223,393 ------------ Illinois - 7.55% Illinois Health Facilities Authority Revenue (Hospital Association Project), 7.00%, 02/15/22 200,000 209,888 Illinois State Highway Authority Toll, Series A, 5.50%, 01/01/15 225,000 231,689 Sauget, Illinois, Pollution Control, 4.45%, FRB, 09/01/22 100,000 100,000 Chicago, Illinois, Water Revenue, 6.50%, 11/01/15 450,000 506,893 Chicago, Illinois, Skyway Toll Bridge, Revenue, 5.375%, 01/01/16 200,000 199,470 ------------ 1,247,940
Principal Value --------- ----- Indiana - 1.26% Elkhart County Hospital Authority, 5.25%, 08/15/28 $250,000 $208,190 ------------ Iowa - 0.95% Iowa Finance Authority Hospital Facility Revenue Refunding (Trinity Regional Hospital Project), 7.00%, 07/01/12 150,000 157,851 ------------ Kansas - 2.04% Wyandotte County, Kansas City, Kansas, Unified Government, 4.50%, 09/01/28 225,000 185,360 Wyandotte County, Kansas City, Kansas, Unified Government Utility System Revenue, 5.75%, 09/01/24 150,000 152,165 ------------ 337,525 Louisiana - 1.33% Louisiana Public Facilities Authority Hospital Revenue Refunding (Touro Infirmary Project), Series A, 5.50%, 08/15/19 250,000 219,145 ------------ Maine - 0.15% Maine State Housing Authority Mortgage Purchase, Revenue Series A-4, 6.375%, 11/15/12 25,000 25,314 ------------ Maryland - 1.74% Maryland State Transit Authority, Facility projects revenue Bond, 6.80%, 07/01/16 6.25%, 02/15/11 250,000 287,245 ------------ Massachusetts - 1.07% Massachusetts State Health & Educational Facilities, Partners Healthcare System, 5.13%, 07/01/20 200,000 177,004 ------------ Michigan - 4.93% Michigan State Hospital Finance Authority, Ascension Health Credit Service, 5.25%, 11/15/09 250,000 253,768 Michigan State Strategic Fund, West Riverbank LP Project, 4.45%, 11/01/06 560,000 560,000 ------------ 813,768 Nevada - 3.15% Nevada Housing Division, Single-Family Revenue Program, B-2, 6.95%, 10/01/26 225,000 231,608
The accompanying notes are an integral part of the financial statements. 108 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Nevada - continued Nevada Housing Division, Single-Family Revenue Program, Issue C, 6.35%, 10/01/12 $285,000 $289,777 ------------ 521,385 New York - 14.79% New York, New York, Series B, Gen. Oblig., 5.75%, 08/01/14 750,000 774,217 New York State Dorm. Authority, Mental Health Services Facility, 6.00%, 02/15/08 250,000 266,518 New York State Environmental Facilities Corporation Pollution Control Revenue Refunding (IBM Corporation Project), 7.125%, 07/01/12 480,000 491,261 New York State Local Government Assistance Corporation, Series A, 6.00%, 04/01/16 310,000 322,853 New York State Mortgage Agency Revenue, Series 40-A, 6.35%, 04/01/21 365,000 372,643 New York State Mortgage Agency Revenue, Series 77A, 7.70%, 04/01/11 225,000 216,135 ------------ 2,443,627 North Dakota - 4.17% North Dakota State Water Commission Facilities Authority Revenue, Series A, 6.00%, 08/01/12 640,000 689,370 ------------ Ohio - 1.04% Washington County, Ohio, Hospital Revenue, 5.375%, 09/01/18 175,000 171,159 ------------ Oklahoma - 1.49% Oklahoma Development Finance Auth., Public Service of Oklahoma Project, 4.88%, 6/01/14 250,000 246,162 ------------ Oregon - 1.40% Portland, Oregon, Airport Revenue, 5.25%, 07/01/11 225,000 230,578 ------------ Pennsylvania - 8.05% Delaware Valley, Pennsylvania, Regional Finance Authority Series A, 5.50%, 08/01/28 500,000 494,620 Philadelphia, Pennsylvania, Gas Works, 5.375%, 07/01/12 250,000 254,602
Principal Value --------- ----- Pennsylvania - continued Philadelphia, Pennsylvania, Water & Wastewater Revenue, 6.25%, 08/01/12 $450,000 $499,486 Pine Richland School District, Series A, Zero Coupon, 09/01/23 300,000 81,492 ------------ 1,330,200 South Carolina - 1.57% South Carolina State Public Revenue, 5.625%, 01/01/13 250,000 259,890 ------------ Tennessee - 2.90% Humphreys County, Tennessee, Industrial Development Board Solid Waste Disposal Revenue (Inland Container Corp. Project), 6.70%, 05/01/24 450,000 479,911 ------------ Texas - 12.66% Argyle, Texas, Independent School District, Zero Coupon, 08/15/14 270,000 128,636 Austin, Texas, Water & Wastewater, 6.50%, 05/15/05 400,000 430,972 Garland, Texas, 4.50%, 02/15/19 250,000 216,050 Kerrville, Texas, Independent School District, 6.00%, 08/15/13 200,000 214,036 Lower Colorado River Authority, Texas Revenue, 6.00%, 05/15/10 250,000 271,743 Lower Colorado River Authority, Texas Prerefunded, 5.25%, 01/01/15 200,000 201,778 Port Arthur, Texas, Navigation District, Zero Coupon, 03/01/10 900,000 560,952 Texas State Veterans Housing Assistance, 6.80%, 12/01/23 65,000 67,533 ------------ 2,091,700 Washington - 1.38% Central Puget Sound, Washington, Regional, 5.25%, 02/01/13 225,000 228,029 ------------ Wisconsin - 3.41% Wisconsin Housing & Economic Development Authority Home Ownership Revenue, Series D, 6.10%, 07/01/24 70,000 71,065
The accompanying notes are an integral part of the financial statements. 109 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Wisconsin - continued Wisconsin State Health & Educational Facilities Authority Revenue, Mercy Hospital of Janesville, Incorporated, 6.60%, 08/15/22 $500,000 $492,785 ------------ 563,850 Wyoming - 0.85% Green River-Sweetwater County, Wyoming, 4.50%, 03/01/14 140,000 139,575 ------------ TOTAL LONG TERM INVESTMENTS (Cost $16,477,811) $16,423,743 ------------ SHORT TERM INVESTMENTS-STUDENT LOAN - 0.61% Missouri Higher Education Loan Authority, 4.40% due 06/01/17 $100,000 ------------ TOTAL INVESTMENTS (Municipal Bond Fund) (Cost $16,577,811) $16,523,743 ------------ - -------------------------------------------------------------------------- Strategic Income Fund - -------------------------------------------------------------------------- Principal Value --------- ----- CORPORATE BONDS - 39.99% Aerospace & Defense - 0.43% Raytheon Company, 6.15% due 11/01/08 $ 175,000 $ 160,188 ------------ Auto Related - 1.13% Pep Boys-Manny Moe & Jack, 6.52% due 07/16/07 200,000 167,410 Prestolite Electric, Inc., 9.625% due 02/01/08 50,000 30,000 Stanadyne Automotive Corp., 10.25% due 12/15/07 275,000 220,000 ------------ 417,410 Banks - 0.07% Western Financial Savings, 8.875% due 08/01/07 30,000 27,113 ------------ Business & Commercial Services - 1.24% Americredit Corp., 9.25% due 02/01/04 25,000 24,125 Cendant Corp., 7.75% due 12/01/03 100,000 97,866 Condor Systems, Inc., 11.875% due 05/01/09 25,000 16,500 Iron Mountain, Inc., 10.125% due 10/01/06 250,000 257,500 National Equipment Services, Inc. Series B, 10.00% due 11/30/04 50,000 30,000 National Equipment Services, Inc. Series C, 10.00% due 11/30/04 50,000 30,000 ------------ 455,991
Principal Value --------- ----- Chemicals - 0.44% Borden Chemicals & Plactics, 9.50% due 05/01/05 $250,000 $145,000 Geo Specialty Chemicals, Inc. 10.125% due 08/01/08 20,000 15,400 ------------ 160,400 Crude Petroleum & Natural Gas - 1.50% Pennzoil Company, 10.25% due 11/01/05 500,000 554,785 ------------ Electronic Equipment & Services - 0.51% Breed Technologies, Inc., 9.25% due 04/15/08/2/ 500,000 3,750 Flextronics International, Ltd.: 8.75% due 10/15/07 60,000 57,900 9.875% due 07/01/10 125,000 126,250 ------------ 187,900 Finance Companies - 1.25% Ono Finance Company Plc, 144A 13.00% due 05/01/09 600,000 462,000 ------------ Food & Drug Distribution - 1.38% Agrilink Foods, Inc. 11.875% due 11/01/08 300,000 214,500 Express Scripts, Inc., 9.625% due 06/15/09 50,000 49,937 Pharmerica, Inc., 8.375% due 04/01/08 325,000 243,750 ------------ 508,187 Healthcare Providers & Services - 2.28% Iasis Healthcare Corp., 13.00% due 10/15/09 235,000 216,200 Lifepoint Hospitals, Inc., 10.75% due 05/15/09 50,000 53,250 Manor Care, Inc., 7.50% due 06/15/06 250,000 206,483 Omega Healthcare Investments, Inc. 6.95% due 06/15/02 135,000 119,903 Universal Hospital Services, Inc., 10.25% due 03/01/08 350,000 245,000 ------------ 840,836 Home Builders - 0.13% Beazer Homes, Inc.: 8.875% due 04/01/08 25,000 23,500 9.00% due 03/01/04 25,000 24,094 ------------ 47,594 Hotels, Restaurants & Leisure - 4.45% Crown Castle International Corp., Zero Coupon due 05/15/11 350,000 224,000 Hollywood Casino, Shreveport, 13.0% due 08/01/06 400,000 428,000 Isle of Capri Casinos, Inc., 8.75% due 04/15/09 25,000 22,688
The accompanying notes are an integral part of the financial statements. 110 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Hotels, Restaurants & Leisure - continued Perkins Family Restaurant, 10.125% due 12/15/07 $25,000 $23,375 Prime Hospitality Corp., 9.75% due 04/01/07 300,000 301,875 Riviera Black Hawk, Inc., 13.00% due 05/01/05 300,000 306,750 Speedway Motorsports, Inc., 8.50% due 08/15/07 350,000 330,750 ------------ 1,637,438 Internet Services - 0.35% Globix Corp., 12.50% due 01/01/10 200,000 128,000 ------------ Machinery - 0.96% Lennar Corp., 9.95% due 05/01/10 125,000 127,500 Pennhall International, Inc., 12.0% due 08/01/06 250,000 227,500 ------------ 355,000 Media - 1.01% Cumulus Media, Inc., 10.375% due 07/01/08 350,000 290,500 Echostar DBS Corp., 9.375% due 02/01/09 10,000 9,837 Susquehanna Media Co., 8.50% due 05/15/09 50,000 49,000 Transwestern Publishing Co., 9.625% due 11/15/07 25,000 24,813 ------------ 374,150 Merchandising - 1.17% Big 5 Corp., 10.875% due 11/15/07 125,000 111,875 True Temper Sports, Inc., 10.875% due 12/01/08 325,000 318,500 ------------ 430,375 Natural Gas - 0.14% Leviathan Gas Pipeline Partners, 10.375% due 06/01/09 50,000 52,625 ------------ Oil & Gas Producers - 2.41% Baker Hughes, Inc. 6.25% due 01/15/09 150,000 141,615 Countrywide Funding Corp., 6.25% due 04/15/09 148,000 133,471 Grey Wolf, Inc., 8.875% due 07/01/07 25,000 24,250 Grey Wolf, Inc., 8.875% due 07/01/07 300,000 291,000 HS Resources, Inc., 9.25% due 11/15/06 50,000 49,500 HS Resources, Inc. Series B, 9.25% due 11/15/06 250,000 249,375 ------------ 889,211
Principal Value --------- ----- Oil Exploration & Production 0.61% Costilla Energy, Inc., 10.25% due 10/01/06 $500,000 $225,000 ------------ Other - 0.51% Ekabel Hessen, 144A 14.50% ue 09/01/10 100,000 94,000 United Pan Europe, 11.25% due 02/01/10 125,000 94,375 ------------ 188,375 Paper & Forest Products - 1.01% Bear Island Paper Co. LLC, 10.00% due 12/01/07 285,000 247,950 Pacifica Papers, Inc. 10.00% due 03/15/09 125,000 123,438 ------------ 371,388 ------------ Pharmaceuticals - 0.40% ICN Pharmaceuticals, Inc., 8.75% due 11/15/08 150,000 148,875 ------------ Pollution Control - 0.34% Allied Waste Industries, Inc., 10.00% due 08/01/09 150,000 126,750 ------------ Real Estate - 0.84% Grove Worldwide, Inc., 9.25% due 05/01/08 175,000 24,500 HMH Properties, Inc., 7.875% due 08/01/08 100,000 91,875 Meditrust Corp. 7.00% due 08/15/07 276,000 193,200 ------------ 309,575 ------------ Steel - 0.83% Renco Steel Holdings, Inc., 10.875% due 02/01/05 100,000 84,000 WCI Steel, Inc., 10.00% due 12/01/04 275,000 221,375 ------------ 305,375 ------------ Telecommunication Services - 14.17% Adelphia Communications Corp., 9.50% due 02/15/04 46,998 44,061 Benedek Communications Corp., 13.25% due 05/15/06 250,000 212,500 Century Communications Corp., 8.875% due 01/15/07 175,000 150,500 Charter Communications, 10.25% due 01/15/10 200,000 194,500 Coaxial Communications, Inc., 10.00% due 08/15/06 25,000 24,125 Concentric Network Corp., 12.75% due 12/15/07 150,000 141,750 Covad Communications Group, Inc., 12.00% due 02/15/10 350,000 168,000
The accompanying notes are an integral part of the financial statements. 111 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Telecommunication Services - continued Energis Plc., 9.75% due 06/15/09 $25,000 $23,875 Frontiervision Holdings, 11.875% due 09/15/07 400,000 342,000 GTE Corp., 6.94% due 04/15/28 18,000 16,359 GT Group Telecommunications, Inc., 13.25% due 02/01/10 150,000 54,750 International Cabletel, Inc., 11.50% due 02/01/06 1,000,000 900,000 Level 3 Communications, Inc., 12.875% due 03/15/10 550,000 272,250 Microcell Telecommunications, 12.00% due 06/01/09 325,000 227,500 Netia Holdings II B.V., 13.125% due 06/15/09 300,000 258,000 Nextel Communications, 9.95% due 02/15/08 750,000 560,625 Northpoint Communications, 12.875% due 02/15/10 300,000 279,000 NTL Communications Corp., 11.50% due 10/01/08 100,000 92,000 PSI Net, Inc., 11.0% due 08/01/09 100,000 48,500 Pegasus Communications Corp., 9.75% due 12/01/06 25,000 24,375 Spectrasite Holdings, Inc., 12.875% due 03/15/10 600,000 291,000 Sprint Capital Corp., 6.125% due 11/15/08 150,000 133,226 Telewest Communication Plc, Step up to 11.00% due 10/01/07 500,000 440,000 Versatel Telecommunications B.V. 13.25% due 05/15/08 150,000 111,750 Versatel Telecommunications Int'l., Inc., 13.25% due 05/15/08 50,000 38,000 Williams Communications Group, 11.70% due 08/01/08 200,000 177,500 ------------ 5,226,146 ------------ Textiles - 0.29% Galey & Lord, Inc., 9.125% due 03/01/08 175,000 108,500 ------------ Utilities-Electric - 0.14% CaithnessCoso Funding Corp. 9.05% due 12/15/09 50,000 50,000 ------------ TOTAL CORPORATE BONDS (Cost $16,438,799) 14,749,187 ------------
Principal Value --------- ----- U.S. TREASURY OBLIGATIONS - 0.80% U.S. Treasury Notes - 0.80% 4.75% due 11/15/08 $315,000 $293,145 ------------ TOTAL U.S. TREASURY OBLIGATIONS (Cost $316,401) $293,145 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 14.14% Federal Home Loan Banks - 0.89% 6.50% due 05/01/29 $140,847 $135,433 7.00% due 06/01/29 197,424 193,536 ------------ 328,969 ------------ Federal Home Loan Mortgage Corporation - 1.34% 8.50% due 05/01/08 241,473 246,303 10.00% due 05/15/20 201,007 209,737 11.565% due 06/15/21 133,461 38,477 ------------ 494,517 ------------ Government National Mortgage Association - 1.50% 7.50% due 07/15/27 239,528 240,426 7.50% due 10/15/27 246,234 247,157 7.50% due 10/15/27 65,253 65,498 ------------ 553,081 ------------ Federal National Mortgage Association - 5.24% 7.50% TBA 1,000,000 998,750 5.50% due 01/01/29 46,358 42,258 5.50% due 06/01/29 441,060 402,053 8.00% due 11/01/28 439,739 445,923 13.00% due 11/01/15 37,512 42,857 ------------ 1,931,841 Federal National Mortgage Association - Interest Only - 2.71% Interest Only due 03/17/20, REMIC 5,225,005 86,456 Interest Only due 02/25/35, REMIC 5,778,047 304,799 Interest Only due 10/17/36, REMIC 12,543,561 278,483 Interest Only due 06/25/38, REMIC 6,093,147 329,419 ------------ 999,157 ------------ Federal National Mortgage Association - CMO - 1.24% 7.394% due 08/17/03, REMIC 103,382 103,106 8.80% due 01/25/19, REMIC 295,072 302,541 10.40% due 04/25/19, REMIC 48,278 51,114 ------------ 456,761 ------------ Student Loan Marketing Association - 1.22% 7.20% due 11/09/00 450,000 450,000 ------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $5,580,524) $5,214,326 ------------ FIXED INCOME - OTHER - 21.85% Collateralized Mortgage Obligations - 9.13% First Union Residential Securities, 7.00% due 08/25/28 $240,598 $216,712
The accompanying notes are an integral part of the financial statements. 112 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Collateralized Mortgage Obligations - 9.13% Green Tree Financial Corp., 7.07% due 09/15/07/\ $2,009,666 $1,929,279 Mid State Trust VI, Class A, 7.34% due 07/01/35/\ 1,269,830 1,219,824 ------------ 3,365,815 ------------ Commercial Mortgage Backed Securities - 5.14% Commercial Mortgage Asset Trust, 7.35% due 08/17/13 1,200,000 1,174,778 DLJ Commercial Mortgage Corp., Interest Only Strips: due 05/10/23 9,520,632 363,715 due 11/12/31 7,517,515 355,804 ------------ 1,894,297 Residential Subordinate Securities - 7.58% GE Capital Management Services, Inc. 6.75% due 11/25/28 977,859 886,801 PNC Mortgage Securities Corp., 6.734% due 07/25/28 411,013 361,703 6.750% due 05/25/28 341,137 299,280 6.770% due 03/25/29 491,695 446,267 6.838% due 05/25/28 462,537 412,509 6.910% due 04/25/29 439,576 390,189 ------------ 2,796,749 TOTAL FIXED INCOME - OTHER (Cost $8,568,069) $8,056,861 ------------ FOREIGN GOVERNMENT OBLIGATIONS - 21.32% Algeria - 1.25% 6.375% due 03/04/10 $570,000 $460,988 ------------ Republic of Argentina - 0.34% 6.812% due 03/31/05 144,000 125,172 ------------ Federal Republic of Brazil - 4.21% 7.00% due 04/15/12 600,000 441,000 8.00% due 04/15/14 1,493,700 1,111,911 ------------ 1,552,911 National Republic of Bulgaria - 0.77% 2.75% due 07/28/12 400,000 282,000 ------------ Government of France - 0.28% 5.50% due 04/25/29 125,000 103,731 ------------ Federal Republic of Germany - 0.95% 4.000% due 07/04/09 110,000 85,384 4.250% due 11/26/04 200,000 164,459 5.625% due 01/04/28 120,000 101,455 ------------ 351,298 Republic of Greece - 0.39% 8.80% due 06/19/07 50,000,000 144,264 ------------ Republic of Italy - 0.23% 5.25% due 11/01/29 110,000 84,273 ------------
Principal Value --------- ----- Government of Mexico - 4.38% 6.25% due 12/31/19 $1,650,000 $1,455,570 10.375% due 02/17/09 150,000 159,015 ------------ 1,614,585 Government of Morocco - 0.81% 6.843% due 01/01/09 344,048 299,321 ------------ Kingdom of Norway - 1.13% 5.75% due 11/30/04 4,000,000 417,157 ------------ Government of Peru - 2.00% 3.75% FRB due 03/07/17 1,400,000 738,500 ------------ Republic of South Africa - 2.42% 12.0% due 02/28/05 3,500,000 447,917 13.00% due 08/31/10 3,500,000 444,422 ------------ 892,339 ------------ Kingdom of Spain - 0.19% 6.15% due 01/31/13 80,000 71,001 ------------ Kingdom of Sweden - 0.25% 10.25% due 05/05/03 800,000 90,235 ------------ Republic of Venezuela - 1.72% 7.437% due 03/31/07 773,805 634,520 ------------ TOTAL FOREIGN GOVERNMENT OBLIGATIONS (Cost $7,800,103) $7,862,295 ------------ Shares Value ------ ----- COMMON STOCK UNIT - 0.02% Ono Finance Company 144A (Cost $0) 100 $7,225 ------------ PREFERRED STOCK - 0.65% TCR Holdings-Class B 570 $6 TCR Holdings-Class C 314 3 TCR Holdings-Class D 827 8 TCR Holdings-Class E 1,711 17 ------------ 34 ------------ Telecommunications - 0.65% Adelphia Communications Corp., PIK Series B, 13.00% (Cost $247,578) 2,500 $239,375 ------------ RIGHTS & WARRANTS - 0.09% Crude Petroleum & Natural Gas - 0.07% Terex Corporation, rights expire 12/31/00 2,000 $25,126 ------------ Other - 0.00% BCP Holdings Corp. exp. 04/15/04 500 0 ------------ Telephone - 0.00% In-flight Phone Corp., warrants, expire 5/15/02 1,000 0 ------------
The accompanying notes are an integral part of the financial statements. 113 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Telecommunications - 0.02% GT Group Telecommunications, Inc., warrants expire 02/01/10 144A 150 $7,575 ------------ TOTAL RIGHTS & WARRANTS (Cost $7,176) $32,701 ------------ Principal Value --------- ----- REPURCHASE AGREEMENT - 1.07% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $394,069 on 11/01/00, collateralized by $350,000 U.S. Treasury Bonds, 10.75% due 05/15/03 (valued at $403,017, including interest) (Cost $394,000) $394,000 $394,000 ------------ Contracts Value ---------- ----- PUT OPTIONS - 0.08% Real Estate Investment Trust - 0.08% Meditrust Exercisable Put Option, 7.114%, Exp. 08/15/04 (Cost $23,989) 50,000 $31,500 ------------ TOTAL INVESTMENTS (Strategic Income Fund) (Cost $39,376,639) $36,880,649 ------------ - ---------------------------------------------------------------------------- U.S. Government Securities Fund - ---------------------------------------------------------------------------- Principal Value --------- ----- U.S. TREASURY OBLIGATIONS - 4.17% U.S. Treasury Bonds - 4.17% 5.25% due 08/15/03 (Cost $2,565,903) $2,600,000 $2,556,944 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 68.19% Federal Agriculture Mortgage Corporation - 0.85% 7.02% due 03/26/04 $520,000 $518,133 ------------ Federal Home Loan Banks - 3.57% 5.80% due 09/02/08/\ 1,500,000 1,419,615 6.70% due 05/07/03 275,000 273,625 7.00% due 03/10/05/\ 500,000 496,560 ------------ 2,189,800 Federal Home Loan Mortgage Corporation - 32.71% 6.50% Gold Balloon, TBA** 2,800,000 2,742,264 7.50% Gold Single, TBA** 3,000,000 3,021,570 8.00% Gold Single, TBA** 700,000 709,408 8.50% Gold Single, TBA** 6,000,000 6,144,360 6.875% due 01/15/05/\ 7,000,000 7,089,670 8.00% due 06/01/08 109,423 110,619 8.25% due 07/01/06 81,685 82,801
Principal Value --------- ----- Federal Home Loan Mortgage Corporation - continued 8.50% due 05/01/08 $98,930 $100,427 11.75% due 08/01/13 30,472 33,494 ------------ 20,034,613 Federal National Mortgage Association - 28.58% 6.527% due 05/25/30 REMIC 2,750,000 2,612,737 6.58% due 12/28/28 1,830,407 1,792,599 6.783% due 01/17/03 REMIC 641,086 631,482 7.00% due TBA** 2,400,000 2,351,256 7.125% due 02/15/05/\ 8,500,000 8,685,895 7.50% due TBA** 1,250,000 1,258,600 8.00% due 08/01/04 10,998 10,991 8.50% due 08/01/02 15,343 15,366 11.00% due 02/01/15 354 389 11.50% due 04/01/19 130,484 144,469 ------------ 17,503,784 Government National Mortgage Association - 2.48% 7.50% due 04/15/02 55,887 55,903 7.75% due 04/15/04 32,441 32,758 8.00% due 11/15/06 - 02/15/08 22,897 23,374 9.00% due 12/15/16 544,142 565,429 10.25% due 03/15/01 1,705 1,719 11.00% due 11/20/14 - 09/20/15 7,934 8,506 11.25% due 10/20/15 3,724 4,013 11.50% due 03/15/13 - 10/20/15 275,503 302,309 12.50% due 09/15/14 16,039 17,983 13.00% due 01/15/11 - 06/15/15 205,565 230,722 13.25% due 07/15/14 38,339 43,276 13.50% due 11/15/12 - 02/15/13 33,092 37,767 15.00% due 07/15/11 - 09/15/12 46,268 54,404 15.50% due 08/15/11 - 09/15/11 115,874 132,899 16.00% due 11/15/11 9,104 10,566 ------------ 1,521,628 TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $42,288,977) $41,767,958 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - SHORT TERM - 16.31% Federal Home Loan Mortgage Corporation - 16.31% 6.36% due 11/07/00 (Cost $9,989,367) $9,989,367 $9,989,367 ------------
The accompanying notes are an integral part of the financial statements. 114 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- REPURCHASE AGREEMENTS - 11.33% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/00 at 6.42%, to be repurchased at $6,939,237 on 11/01/00, collateralized by $5,375,000 U.S. Treasury Bonds, 8.75% due 05/15/17 (valued at $7,108,311, including interest) (Cost $6,938,000) $6,938,000 $6,938,000 ------------ TOTAL INVESTMENTS (U.S. Government Securities Fund) (Cost $61,782,247) $61,252,269 ------------
- -------------------------------------------------------------------------------- Money Market Fund - -------------------------------------------------------------------------------- COMMERCIAL PAPER - 96.73% Ace INA Holdings, Inc., 6.60% due 11/10/00 $1,000,000 $998,350 Ace INA Holdings, Inc., 6.57% due 11/14/00 409,000 408,030 Albertson's, Inc., 6.52% due 11/13/00 700,000 698,479 Albertson's, Inc., 6.55% due 11/06/00 1,000,000 999,090 AON Corp., 6.53% due 11/13/00 303,000 302,340 AON Corp., 6.53% due 11/17/00 1,493,000 1,488,667 BancOne Corp., 6.56% due 01/10/01 1,909,000 1,884,650 Baxter International, Inc., 6.52% due 11/07/00 700,000 699,239 Baxter International, Inc., 6.52% due 12/01/00 1,100,000 1,094,023 Bellsouth Telecommunications, Inc., 6.47% due 11/28/00 1,000,000 995,147 Cardinal Health, Inc., 6.49% due 12/05/00 1,000,000 993,871 Cardinal Health, Inc., 6.50% due 12/05/00 800,000 792,922 Ciesco L.P., 6.45% due 12/14/00 800,000 793,837 Coca Cola Co., 6.45% due 12/06/00 1,000,000 993,729 Cooper Industries, Inc., 6.55% due 11/08/00 915,000 913,835 Countrywide Home Loans, Inc., 6.55% due 11/16/00 971,000 968,350 Delaware Funding Corp., 6.53% due 01/17/01 1,520,000 1,498,770 Dover Corporation, 6.49% due 11/13/00 598,000 596,706
Principal Value --------- ----- COMMERCIAL PAPER - continued Dover Corporation, 6.70% due 02/28/01 $1,000,000 1,000,000 Duke Capital Corp., 6.55% due 11/22/00 1,406,000 1,400,628 Eastman Kodak Company, 6.49% due 12/04/00 711,000 706,770 Ford Motor Credit Corp., 6.91% due 10/01/01 1,800,000 1,802,504 General Electric Capital Corp., 6.52% due 01/18/01 1,000,000 985,873 General Motors Acceptance Corp., 7.11% due 07/11/01 2,000,000 2,004,791 Goldman Sachs Group LP, 6.52% due 01/19/01 1,000,000 985,692 Govco, Inc., 6.51% due 11/21/00 800,000 797,107 Govco, Inc., 6.55% due 01/31/01 1,000,000 983,443 Harley Davidson Dealer Funding, 6.49% due 11/09/00 1,000,000 998,558 Household International, Inc., 6.53% due 11/10/00 1,800,000 1,797,062 Jefferson Pilot Corp., 6.53% due 02/28/01 1,000,000 978,415 Morgan Stanley Dean Witter, 6.47% due 12/13/00 1,000,000 992,452 Omnicom Finance, Inc., 6.57% due 11/21/00 1,631,000 1,625,047 PPG Industries, Inc., 6.50% due 11/03/00 683,000 682,753 Pacific Gas & Electric Co., 6.52% due 01/31/01 1,020,000 1,003,189 Receivables Capital Corp., 6.51% due 11/01/00 1,200,000 1,200,000 Receivables Capital Corp., 6.53% due 01/25/01 672,000 661,639 Safeway, Inc., 6.70% due 12/18/00 1,000,000 991,253 Salomon Smith Barney Holdings, Inc., 6.48% due 11/20/00 1,000,000 996,580 Southern California Edison Co., 6.48% due 11/08/00 983,000 981,761 Southern California Edison Co., 6.53% due 11/02/00 860,000 859,844 Textron Financial Corp., 6.57% due 01/05/01 1,000,000 988,138 United Healthcare Corp., 6.53% due 12/11/00 900,000 893,470 United Healthcare Corp., 6.53% due 12/12/00 1,000,000 992,563
The accompanying notes are an integral part of the financial statements. 115 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- COMMERCIAL PAPER - continued Wal Mart Stores, Inc., 6.47% due 11/27/00 $675,000 $671,846 ------------ TOTAL COMMERCIAL PAPER (Cost $45,101,413) $45,101,413 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 3.22% Student Loan Marketing Association - 3.22% 6.805% due 02/21/01 (Cost $1,500,000) $1,500,000 $1,500,000 ------------ REPURCHASE AGREEMENT - 0.05% Repurchase Agreement with State Street Bank & Trust dated 10/31/00 at 6.42%, to be repurchased at $27,005 on 11/01/00, collateralized by $20,000 U.S. Treasury Bonds, 11.25% due 02/15/15 (valued at $30,341, including interest) (Cost $27,000) $27,000 $27,000 ------------ TOTAL INVESTMENTS (Money Market Fund) (Cost $46,628,413) $46,628,413 ------------ - ------------------------------------------------------------------------------- Municipal Money Market Fund - ------------------------------------------------------------------------------- Par Value Value --------- ----- SHORT-TERM INVESTMENTS - 100.00% Colorado - 4.12% Colorado Health Facilities Authority, 4.40% due 05/15/20 $100,000 $100,000 Colorado Springs Utilities, 5.00% due 11/15/00 200,000 200,036 ------------ 300,036 ------------ Florida - 6.17% Broward County Industrial Development, 4.20% due 04/01/08 200,000 200,000 Orlando Special Assessment, 4.25% due 10/01/21 250,000 250,000 ------------ 450,000 ------------ Georgia - 3.43% Municipal Electric Authority Georgia, 4.30% due 01/01/20 250,000 250,000 ------------ Illinois - 8.23% Chicago, Illinois, 4.30% due 01/01/12 300,000 300,000 llinois Health Facilities Authority, 4.35% due 11/15/29 100,000 100,000
Par Value Value --------- ----- Illinois - continued Illinois State Toll Highway Authority, 4.40% due 01/01/16 $200,000 $200,000 ------------ 600,000 ------------ Indiana - 6.86% Indiana Secondary Market Educational Loans, 4.40% due 12/01/14 300,000 300,000 Marion Indiana Economic Development, 4.35% due 06/30/01 200,000 200,000 ------------ 500,000 ------------ Kentucky - 6.17% Ashland Kentucky Pollution Control, 4.35% due 04/01/09 200,000 200,000 Kentucky Higher Education Student Loan, 4.35% due 06/01/26 250,000 250,000 ------------ 450,000 ------------ Maine - 4.12% Maine State Housing Authority, 4.40% due 10/28/32 300,000 300,000 ------------ Maryland - 1.37% Community Development Administration Maryland Multifamily, 4.25% due 06/15/26 100,000 100,000 ------------ Massachusetts - 3.43% Massachusetts State Housing Finance Agency, 4.20% due 12/01/25 250,000 250,000 ------------ Michigan - 8.23% Bruce Township Hospital Finance, 4.25%, due 05.01.18 200,000 200,000 Detroit Michigan Sewage Disposal, 4.30% due 07/01/23 200,000 200,000 Grand Rapids Michigan Water Supply System, 4.20% due 01/01/20 200,000 200,000 ------------ 600,000 ------------ Minnesota - 6.18% Duluth Minnesota Tax Increment Revenue, 4.35% due 09/01/10 250,000 250,000 Minneapolis Minnesota Special School District, 5.00% due 02/01/01 200,000 200,338 ------------ 450,338 ------------
The accompanying notes are an integral part of the financial statements. 116 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Par Value Value --------- ----- Missouri - 5.49% Missouri Higher Education Student Loans, 4.40% due 12/01/05 $200,000 $200,000 Missouri State Health and Educational Facilities Authority, 4.30% due 09/01/30 200,000 200,000 ------------ 400,000 ------------ North Carolina - 2.74% North Carolina Medical Care Commission: 4.40% due 09/01/02 100,000 100,000 4.65% due 10/01/20 100,000 100,000 ------------ 200,000 ------------ Ohio - 4.80% Cuyahoga County Ohio Industrial Development, 4.25% due 12/01/15 100,000 100,000 Franklin County Ohio Industrial Development, 4.40% due 11/01/14 250,000 250,000 ------------ 350,000 ------------ Pennsylvania - 9.69% Berks County Pennsylvania, 7.25% due 11/15/00 305,000 305,855 Pennsylvania State Higher Education Student Loan, 4.40% due 12/01/25 100,000 100,000 Philadelphia Pennsylvania Authority Industrial Development, 4.40% due 12/01/08 200,000 200,000 Quakertown Pennsylvania Hospital Authority, 4.35% due 07/01/05 100,000 100,000 ------------ 705,855 ------------ South Carolina - 7.55% Piedmont Municipal Power Agency, 4.30% due 01/01/19 250,000 250,000 South Carolina Educational Facilities Authority, 4.40% due 10/01/26 300,000 300,000 ------------ 550,000 ------------ Texas - 7.99% La Joya Texas Independent School District, 5.00% due 02/15/01 200,000 201,047 North Texas Higher Education Authority, 4.40% due 04/01/20 200,000 200,000
Par Value Value --------- ----- Texas - continued Weslaco Texas Independent School District, 5.25% due 02/15/01 $180,000 $181,100 ------------ 582,147 ------------ Utah - 3.43% Utah State Board of Regents Student Loan, 4.40% due 11/01/25 250,000 250,000 ------------ TOTAL INVESTMENTS (Municipal Money Market Fund) (Cost $7,288,376) $ 7,288,376 ------------ - -------------------------------------------------------------------------- Aggressive Growth LifeStyle Fund - -------------------------------------------------------------------------- Shares Value ------ ----- AFFILIATED INVESTMENT COMPANIES - 100.0% INTERNATIONAL EQUITY SECURITIES - 24.6% North American International Equity Fund - Class I (Cost - $6,344,019) 543,537 $5,690,833 ------------ DOMESTIC EQUITY SECURITIES - 65.6% North American Growth & Income Fund - Class I 84,703 $2,296,286 North American Large Cap Growth Fund - Class I 257,857 4,749,722 North American Mid Cap Growth Fund - Class I 66,242 1,189,045 North American Mid Cap Value Fund - Class I 252,702 3,431,691 North American Small Cap Growth Fund - Class I 203,110 3,519,898 ------------ TOTAL DOMESTIC EQUITY SECURITIES - (Cost - $16,212,458) 15,186,642 ------------ BONDS - 9.8% North American Core Bond Fund - Class I (Cost - $2,264,375) 235,651 2,269,324 ------------ TOTAL INVESTMENTS (Aggressive Growth LifeStyle Fund) (Cost - $24,820,852) 23,146,799 ------------ - -------------------------------------------------------------------------- Moderate Growth LifeStyle Fund - -------------------------------------------------------------------------- Shares Value ------ ----- AFFILIATED INVESTMENT COMPANIES - 100.0% INTERNATIONAL EQUITY SECURITIES - 14.8% North American International Equity Fund - Class I (Cost - $3,365,870) 295,924 $3,098,323 ------------
The accompanying notes are an integral part of the financial statements. 117 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2000 - continued (showing percentage of total value of investments) - -------------------------------------------------------------------------------
Shares Value ------ ----- DOMESTIC EQUITY SECURITIES - 55.6% North American Growth & Income Fund - Class I 115,291 $3,125,544 North American Large Cap Growth Fund - Class I 175,472 3,232,199 North American Mid Cap Growth Fund - Class I 36,063 647,330 North American Mid Cap Value Fund - Class I 183,449 2,491,237 North American Small Cap Growth Fund - Class I 122,864 2,129,230 ------------ TOTAL DOMESTIC EQUITY SECURITIES - (Cost - $12,228,852) $11,625,540 ------------ BONDS - 29.6% North American Core Bond Fund - Class I (Cost - $6,161,586) 641,486 $6,177,512 ------------ TOTAL INVESTMENTS (Moderate Growth LifeStyle Fund) (Cost - $21,756,308) $20,901,375 ------------
- ------------------------------------------------------------------------------- Conservative Growth LifeStyle Fund - -------------------------------------------------------------------------------
Shares Value ------ ----- AFFILIATED INVESTMENT COMPANIES - 100.0% INTERNATIONAL EQUITY SECURITIES - 7.9% North American International Equity Fund - Class I (Cost - $1,593,188) 138,640 $1,451,557 ----------- DOMESTIC EQUITY SECURITIES - 42.6% North American Growth & Income Fund - Class I 87,771 $2,379,481 North American Large Cap Growth Fund - Class I 133,590 2,460,729 North American Mid Cap Growth Fund - Class I 21,119 379,093 North American Mid Cap Value Fund - Class I 107,430 1,458,899 North American Small Cap Growth Fund - Class I 64,757 1,122,236 ----------- TOTAL DOMESTIC EQUITY SECURITIES - (Cost - $8,209,599) $7,800,438 ----------- BONDS - 49.5% North American Core Bond Fund - Class I (Cost - $9,020,682) 939,197 $9,044,463 ----------- TOTAL INVESTMENTS (Conservative Growth LifeStyle Fund) (Cost - $18,823,469) $18,296,458 -----------
- ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Key to Currency Abbreviations AUD- Australian Dollar CAD- Canadian Dollar EUR- European Currency Unit GBP- British Pound GRD- Greek Drachma HKD- Hong Kong Dollar JPY- Japanese Yen NOK- Norwegian Krone PLN- Polish Zloty SEK- Swedish Krona Key to Security Abbreviations and Legend FRB Floating Rate Bond. The interest rates shown on FRBs are the current interest rates at October 31, 2000, which are subject to change based on the terms of the security. REMIC Real Estate Mortgage Investment Conduit TBA Forward Commitment 1 Non-Income producing, issuer is in default of interest payments 2 Non-Income producing, issuer is in bankruptcy and is in default of interest payments /\ Collateral for forward commitments * Non-Income producing ** Purchased on a forward commitment (Note 2) PIK Payment in Kind The accompanying notes are an integral part of the financial statements. 118 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- 1. ORGANIZATION OF THE FUND. North American Funds (the "Fund") is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. It is a series company, which means it has several portfolios, each with a stated investment objective which it pursues through separate investment policies. As of October 31, 2000, the Fund offered twenty four portfolios, and the following twenty three portfolios are included in this report: U.S. Equity Funds: Growth & Income Fund ("Growth & Income") Large Cap Growth Fund (formerly the Growth Equity Fund) ("Large Cap Growth") Mid Cap Growth Fund (formerly the Small/Mid Cap Fund) ("Mid Cap Growth") Mid Cap Value Fund ("Mid Cap Value") Science & Technology Fund ("Science & Technology") Small Cap Growth Fund (formerly the Emerging Growth Fund) ("Small Cap Growth") Small Cap Index Fund ("Small Cap Index") Socially Responsible Fund ("Socially Responsible") Stock Index Fund ("Stock Index") International/Global Equity Funds: Global Equity Fund ("Global Equity") International Equity Fund, ("International Equity") International Small Cap Fund ("International Small Cap") Balanced Funds: Balanced Fund ("Balanced") Income Funds: Core Bond Fund (formerly the Investment Quality Bond Fund) ("Core Bond") High Yield Bond Fund ("High Yield Bond") Municipal Bond Fund, (formerly the National Municipal Bond Fund) ("Municipal Bond") Strategic Income Fund ("Strategic Income") U.S. Government Securities Fund ("U.S. Government Securities") Money Market Funds: Money Market Fund ("Money Market") Municipal Money Market Fund ("Municipal Money Market") LifeStyle Funds: Aggressive Growth LifeStyle Fund ("Aggressive Growth LifeStyle") Moderate Growth LifeStyle Fund ("Moderate Growth LifeStyle") Conservative Growth LifeStyle Fund ("Conservative Growth LifeStyle") All of the portfolios are diversified management investment companies except for Small Cap Growth, Aggressive Growth LifeStyle, Moderate Growth LifeStyle and Conservative Growth Lifestyle, which are non-diversified management investment companies. The Fund offers Class A, Class B, Class C, Class I and, in Core Bond and High Yield, Class II shares. Class A shares are sold with a front-end sales charge up to 5.75%. Class B and Class C shares are sold without an initial sales charge. Class B shares are sold with a contingent deferred sales charge which declines from 5% to zero depending on the period of time shares are held. Class C shares are sold with a contingent deferred sales charge of 1% in the first year after purchase. The redemption price per share may differ from the net asset value per share. Class B shares will automatically convert to Class A shares of the same portfolio eight years after purchase. Class I and Class II shares are sold only through institutional investment plans and other eligible programs as described in the prospectus and have no front-end or contingent deferred sales charges. All five classes of shares have identical voting, dividend, liquidation and other rights, except that each class has exclusive voting rights with respect to its distribution plan (See Note 5). Investment income, realized and unrealized capital gains and losses and common expenses of each portfolio are allocated on a pro-rata basis to each class based on their relative net assets. Effective March 10, 2000 CypressTree Investments, Inc. ("CypressTree") sold substantially all of its assets including all of the stock of CypressTree Asset Management Corporation, Inc. ("CAM"), the Trust's investment adviser, and all of the stock of CypressTree Funds Distributors, Inc. ("CFD"), the Trust's distributor, to American General Corporation ("American General"). The acquisition by American General of CypressTree's assets (herein "the Acquisition") took place pursuant to a Purchase Agreement dated February 25, 2000. 119 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 1 - continued The closing of the Acquisition on March 10, 2000 (the "Closing") constituted an assignment of the investment advisory agreement between CAM and the Trust with respect to the Funds, and of the distribution agreement between CFD and the Trust. Under the Investment Company Act of 1940, as amended (the "Investment Company Act"), these assignments operated to terminate automatically each of the investment advisory and distribution agreements. American General Asset Management Corp., Inc. ("AGAM") , a subsidiary of American General Corporation, serves as investment adviser and American General Fund Distributors, Inc,. ("AGFD") serves as principal underwriter for the Fund, effective March 10, 2000. Previously, those services were provided by CypressTree Asset Management Corporation, Inc. ("CAM"), a wholly-owned subsidiary of CypressTree Investments, Inc. ("CypressTree"). AGFD serves as distributor for the Fund. Previously, this service was provided by CypressTree Funds Distributors, Inc. ("CFD"), also a wholly-owned subsidiary of CypressTree. Effective March 10, 2000, Founders Asset Management LLC became sub-adviser to Global Equity, INVESCO Funds Group, Inc. became sub-adviser to Mid Cap Growth and Balanced, and American General Investment Management, L.P. ("AGIM") became sub-adviser to Strategic Income, Core Bond, Municipal Bond, U.S. Government Securities and Money Market. 2. SIGNIFICANT ACCOUNTING POLICIES. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. The preparation of financial statements is in conformity with generally accepted accounting principles and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Security Valuation. Securities which are traded on a recognized exchange are valued at the last sale price as of the close of business on a principal securities exchange (domestic or foreign) or, lacking any sales, at the closing bid price. Securities traded only in the over-the-counter market are valued at the last bid price quoted by brokers making markets in the securities at the close of trading on the Exchange. Portfolio debt securities purchased with an original maturity greater than sixty days are valued by pricing agents, approved by the Board of Trustees, whose quotations reflect broker/dealer supplied valuations and electronic data processing techniques. Other assets and securities for which no such quotation or valuations are readily available are valued at their fair value as determined in good faith under consistently applied procedures established by and under the general supervision of the Trustees. Investments of Money Market and Municipal Money Market are valued using the amortized cost method, permitted in accordance with Rule 2a-7 under the Investment Company Act. The LifeStyle Funds' securities are valued at the net asset value of the underlying fund. This method involves valuing a portfolio security at its cost and thereafter assuming a constant amortization to maturity of any discount or premium. Foreign Currency Translations. The accounting records of the Fund are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on the following basis: (i) market value of securities, other assets and other liabilities at the current rate of exchange of such currencies against U.S. dollars; and (ii) purchases and sales of securities, income and expenses at the rate of exchange quoted on the respective dates of such transactions. Gains and losses that arise from changes in foreign exchange rates have been segregated from gains and losses that arise from changes in the market prices of investments. These gains and losses are included with gains and losses on foreign currency and forward foreign currency contracts in the Statements of Operations. Forward Foreign Currency Contracts. All portfolios, with the exception of U.S. Government Securities, Municipal Bond, Money Market and Municipal Money Market, may purchase and sell forward foreign currency contracts in order to hedge a specific transaction or portfolio position. The net U.S. dollar value of foreign currency underlying all contractual commitments held at the end of the period and the resulting net unrealized appreciation (depreciation) and related net receivable or payable amount are determined daily using forward currency exchange 120 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 2 - continued rates supplied by a quotation service. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts or if the value of the foreign currency changes unfavorably. Net realized gains (losses) on forward foreign currency contracts, shown in the Statements of Operations, includes net gains or losses realized by a portfolio on contracts which have matured. Options Contracts. The Fund may use option contracts to hedge against changes in the value of securities the Fund owns or expects to purchase. The Fund may also write options on securities it owns or in which it may invest in an attempt to increase its current returns. The potential risk to the Fund is that the change in value of options contracts may not correspond to the change in value of the hedged instruments, but is generally limited to the premium originally paid. Also, losses may arise from changes in the value of the underlying instruments, if there is an illiquid secondary market for the contracts, or if the counterparty to the contract is unable to perform. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. Realized gains and losses on purchased options are included in realized gains and losses on investment securities. Exchange traded options are valued at the quoted daily settlement prices established by the exchange on which they trade. Forward Commitments. The Fund may purchase debt securities on a "when-issued" or "forward delivery" basis. Delivery and payment for securities which have been purchased or sold on a forward commitment basis can take place a month or more (not to exceed 120 days) after the date of the transaction. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The Fund will establish a segregated account consisting of cash or liquid high-quality debt securities equal to the amount of the commitment to purchase when-issued or forward delivery securities. The value of the securities underlying a forward commitment to purchase securities, and any subsequent fluctuations in their value, is taken into account when determining the portfolio's net asset value starting on the day the portfolio agrees to purchase the securities. At October 31, 2000, the forward commitments were $82,793,744 in Core Bond, $998,750 in Strategic Income and $16,254,425 in U.S. Government Securities. Mortgage Dollar Rolls. Each of the Funds except the Money Market Fund and the Municipal Money Market Fund may enter into mortgage dollar rolls in which they sell mortgage-backed securities for normal delivery in the current month and simultaneously contract to repurchase similar, but not identical, securities at the same price on an agreed upon date. The portfolio receives compensation as consideration for entering into the commitment to repurchase. The compensation is recorded as deferred income and amortized to income over the roll period. As the holder, the counterparty receives all principal and interest payments, including prepayments, made with respect to the similar security. Mortgage dollar rolls may be renewed with a new sale and repurchase price with a cash settlement made at renewal without physical delivery of the securities subject to the contract. Futures Contracts. The Fund may enter into futures contracts to hedge against market risk. Upon entering into a futures contract, the portfolio is required to deposit with the custodian on behalf of the broker an amount of cash or cash equivalents equal to a certain percentage of the contract amount, which is known as the "initial margin". The potential risk to the Fund is that the change in value of futures contracts may not correspond to the change in value of the hedged instruments. Also, losses may arise from changes in the value of the underlying instruments, if there is an illiquid secondary market for the contracts, or if the counterparty to the contract is unable to perform. Subsequent payments, called "variation margin", are made or received by the portfolio, depending upon the fluctuation of the value of the futures contract. When futures contracts are closed, the difference between the opening value at the date of purchase and the value at closing is recorded as realized gain/(loss) in the Statement of Operations. Futures contracts are valued at the most recent settlement price. Securities Lending. Certain portfolios of the Fund may lend its portfolio securities in amounts up to 33% of its total non-cash assets to brokers, dealers and other financial institutions, provided such loans are callable at any time and are at all times fully collateralized by cash, cash equivalents, short term investments or securities issued or guaranteed by the U.S. government or its agencies or instrumentalities, and marked to market to the value of the loaned securities on a daily basis. The portfolio may bear the risk of delay in recovery of, or even loss of rights in, the securities loaned should the borrower of the securities fail financially. Consequently, loans of portfolio securities will only be made to firms deemed by the Subadvisers to be creditworthy. The portfolio receives compensation for lending its securities either in the form of fees or by retaining a portion of interest on the investment of any cash received as collateral. Cash collateral provided is invested in the State Street Bank and Trust Company Navigator Securities Lending Trust. The related income is included as interest income in the Statements of Operations. All collateral received will be 121 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 2 - continued in an amount equal to at least 100% of the market value of the loaned securities and should be maintained at that level during the period of the loan. During the loan period, the portfolio continues to retain rights of ownership, including dividends and interest of the loaned securities. At October 31, 2000, the value of the securities loaned amounted to $2,173,125, $8,071,068, $11,011,640, $10,136,990, $1,370,224, $3,303,575, $16,999,487, and $2,434,396 in Growth & Income, Large Cap Growth, Mid Cap Growth, Small Cap Growth, Global Equity, International Equity, Core Bond and Strategic Income, respectively. At October 31, 2000, the value of cash collateral amounted to $2,052,000, $7,577,734, $10,716,980, $9,908,134, $1,416,057, $3,410,912, $17,427,484, and $3,385,257 in Growth & Income, Large Cap Growth, Mid Cap Growth, Small Cap Growth, Global Equity, International Equity, Core Bond and Strategic Income, respectively. Organization Costs. Costs incurred by the Small Cap Growth portfolio in connection with its organization are being amortized on a straight line basis over a five year period. Federal Income Taxes. The Fund's policy is for each portfolio to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, as amended, and to distribute all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. Each portfolio is treated as a separate taxpayer for federal income tax purposes. Distributions of Income and Gains. Distributions of net investment income are declared as a dividend to shareholders of record as of the close of business each day and are paid monthly for Core Bond, High Yield Bond, Municipal Bond, Strategic Income, U.S. Government Securities, Money Market and Municipal Money Market, quarterly for Small Cap Index, Socially Responsible, Stock Index and the LifeStyle Funds, semi-annually to shareholders of International Equity and Growth & Income, and annually to shareholders of Large Cap Growth, Mid Cap Growth, Mid Cap Value, Science & Technology, Small Cap Growth, Global Equity, International Equity and Balanced. During any particular year, net realized gains from investment, futures and foreign currency transactions for each portfolio, in excess of available capital loss carryforwards of each portfolio, would be taxable to the portfolio if not distributed and, therefore, will be distributed to shareholders. An additional distribution may be made to the extent necessary to avoid the payment of a federal excise tax. Capital Loss Carryforwards. At October 31, 2000, capital loss carryforwards available to offset future recognized gains were approximately:
Capital Loss Carryforwards: Expiration Year ---------------------------------------------------- Portfolio 2003 2004 2005 2006 2007 2008 - --------- --------- ---- ------- --------- --------- --------- Science & Technology..... - - - - - 1,069,495 Growth & Income.......... - - 974,573 232,312 5,251,432 - Socially Responsible..... - - - - - 159,082 Stock Index.............. - - - - - 16,953 Global Equity............ - - - - - 2,339,194 Balanced................. - - - - - 2,378,112 Core Bond................ 329,026 - - 7,250,820 7,004,605 7,052,964 High Yield............... - - - - 710,603 3,014,754 Municipal Bond........... 24,157 - - 20,931 262,544 3,360 Strategic Income......... - - 110,152 - 3,866,240 3,438,003 U. S. Government Securities............... 1,062,756 - - - 594,779 1,075,945 Money Market............. - - 1,130 1,156 - 461
As a result of the reorganization of some of these funds during the year, certain capital loss carryforwards may be subject to limitations on use pursuant to applicable U.S. Federal Income Tax law. Therefore, it is possible not all of these capital losses will be available for use. Repurchase and Reverse Repurchase Agreements. Each portfolio may enter into repurchase agreements and, additionally, U.S. Government Securities may enter into reverse repurchase agreements. When a portfolio enters into a repurchase agreement through its custodian, it receives delivery of securities, the amount of which at the time of purchase and each subsequent business day is required to be maintained at such a level that the market value is equal to 102% of the repurchase price, and such portfolio will take constructive receipt of all securities underlying the repurchase agreements until such agreements expire. If the seller defaults, a portfolio would suffer a loss to the extent that proceeds from the sale of underlying securities were less than the repurchase price. Under a reverse repurchase agreement, U.S. Government Securities may sell a debt security and agree to repurchase it at an agreed upon time and at an agreed upon price. 122 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 2 - continued Other. Investment security transactions are accounted for on trade date. Interest income is accrued as earned. Dividend income and distributions to shareholders are recorded on the ex-dividend date. All original issue discounts are accreted for financial and federal income tax reporting purposes. The Fund uses the First In, First Out method for determining realized gain or loss on investments, futures and foreign currency for both financial and federal income tax reporting purposes. Non-cash dividends, if any, are recorded at the fair market value of the securities received. Capital Accounts. The Fund reports the accumulated undistributed net investment income (loss) and accumulated undistributed net realized gain (loss) accounts on a basis approximating amounts available for future tax distributions (or to offset future taxable realized gains when a capital loss carryforward is available). Accordingly, each portfolio of the Fund may periodically make reclassifications among certain capital accounts without impacting the net asset value. 3. CAPITAL SHARES. Share activity for the year ended October 31, 2000, is as follows:
Shares Capital Shares Capital ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Growth & Income Sold...................... 520,232 $14,345,704 650,532 $17,609,391 Shares issued in connection with the merger of North American Equity-Income............ 304,952 8,608,176 610,686 16,835,378 Shares issued in connection with the merger of North American Tax-Sensitive Equity..... 9,543 269,386 82,798 2,282,585 Shares issued in connection with the merger of AGSPC2 Large Cap Value..................... 92,804 2,619,669 274,941 7,579,579 Reinvestment of distributions............. 105,709 2,884,282 315,780 8,444,061 Redeemed.................. (605,069) (16,899,847) (1,601,437) (43,338,250) ---------- ----------- ---------- ----------- Net increase/(decrease).. 428,171 $11,827,370 333,300 $9,412,744 ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Growth & Income Sold...................... 1,062,513 $29,009,747 276,505 $7,842,218 Shares issued in connection with the merger of North American Equity-Income............ 1,410,041 39,042,706 - - Shares issued in connection with the merger of North American Tax-Sensitive Equity..... 81,780 2,264,394 - - Shares issued in connection with the merger of AGSPC2 Large Cap Value..................... - - 162,787 4,598,570 Reinvestment of distributions............. 449,765 12,080,942 Redeemed.................. (2,073,452) (56,268,644) (60,597) (1,642,017) ---------- ----------- ---------- ----------- Net increase/(decrease).. 930,647 $26,129,145 378,695 $10,798,771 ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Large Cap Growth Sold...................... 180,298 $3,963,213 510,101 $11,202,280 Shares issued in connection with the merger of AGSPC2 Large Cap Growth.................... 240,358 5,302,772 922,147 19,731,175 Reinvestment of distributions............. 74,768 1,502,311 265,589 5,130,551 Redeemed.................. (237,334) (5,349,958) (551,390) (12,079,257) ---------- ----------- ---------- ----------- Net increase/(decrease).. 258,090 $5,418,338 1,146,447 $23,984,749 ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Large Cap Growth Sold...................... 542,311 $12,012,298 817,135 $17,838,190 Shares issued in connection with the merger of AGSPC2 Large Cap Growth.................... - - 297,894 6,578,574 Reinvestment of distributions............. 214,569 4,238,969 82,237 1,547,705 Redeemed.................. (395,536) (8,550,664) (159,511) (3,393,150) ---------- ----------- ---------- ----------- Net increase/(decrease).. 361,344 $7,700,603 1,037,755 $22,570,919 ---------- ----------- ---------- -----------
123 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital --------- --------- --------- ----------- --------- ----------- Class A Class B ----------------------- ----------------------- Mid Cap Growth Sold.................... 236,428 $4,958,839 398,588 $8,068,295 Shares issued in connection with the merger of AGSPC2 Mid Cap Growth............. 112,209 2,428,094 326,329 6,785,306 Reinvestment of distributions........... 152,684 2,771,897 446,218 7,770,631 Redeemed................ (168,892) (3,635,675) (366,298) (7,489,811) --------- ----------- --------- ----------- Net increase/(decrease).... 332,429 $6,523,155 804,837 $15,134,421 --------- ----------- --------- ----------- Class C Class I ----------------------- ----------------------- Mid Cap Growth Sold.................... 478,136 $9,593,264 139,968 $3,018,075 Shares issued in connection with the merger of AGSPC2 Mid Cap Growth............. - - 471,490 10,228,987 Reinvestment of distributions........... 372,559 6,549,451 106,192 1,883,847 Redeemed................ (559,008) (11,298,090) (69,387) (1,465,582) --------- ----------- --------- ----------- Net increase/(decrease).... 291,687 $4,844,625 648,263 $13,665,327 --------- ----------- --------- ----------- Class A Class B ----------------------- ----------------------- Mid Cap Value Sold.................... 144,253 $1,841,667 472,924 $5,823,819 Reinvestment of distributions........... 31,579 373,702 88,412 1,029,601 Redeemed................ (118,255) (1,550,678) (384,551) (4,956,358) --------- ----------- --------- ----------- Net increase/(decrease).... 57,577 $664,691 176,785 $1,897,062 --------- ----------- --------- ----------- Class C Class I Class II -------------------- ----------------------- ----------------------- Mid Cap Value Sold.................... 43,900 $601,390 1,252,181 $16,290,616 11,121 $137,028 Reinvestment of distributions........... 2,397 29,983 68,110 845,335 16,112 181,253 Redeemed................ (599,402) (7,827,596) (149,144) (1,862,031) --------- --------- --------- ----------- --------- ----------- Net increase/(decrease).... 46,297 $631,373 720,889 $9,308,355 (121,911) ($1,543,750) --------- --------- --------- ----------- --------- ----------- Class A Class B ----------------------- ----------------------- Science & Technology Sold.................... 604,655 $5,510,690 2,111,172 $18,832,737 Reinvestment of distributions........... Redeemed................ (32,401) (283,380) (138,114) (1,184,568) --------- ----------- --------- ----------- Net increase/(decrease).... 572,254 $5,227,310 1,973,058 $17,648,169 --------- ----------- --------- ----------- Class C Class I ----------------------- ----------------------- Science & Technology Sold.................... 136,418 $1,133,849 66,676 $666,741 Reinvestment of distributions........... Redeemed................ (234) (1,808) --------- ----------- --------- ----------- Net increase/(decrease).... 136,184 $1,132,041 66,676 $666,741 --------- ----------- --------- ----------- Class A Class B ----------------------- ----------------------- Small Cap Growth Sold.................... 179,013 $3,493,309 256,423 $4,499,113 Shares issued in connection with the merger of AGSPC2 Small Cap Growth............. 257,697 5,093,883 754,012 14,548,655 Reinvestment of distributions........... 21,216 354,265 50,039 812,730 Redeemed................ (81,989) (1,648,781) (246,538) (4,858,401) --------- ----------- --------- ----------- Net increase/(decrease).... 375,937 $7,292,693 813,936 $15,002,097 --------- ----------- --------- -----------
124 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital --------- ---------- --------- ----------- ---------- ------------ Class C Class I ----------------------- ------------------------ Small Cap Growth Sold.................... 185,962 $3,432,164 434,971 $8,306,602 Shares issued in connection with the merger of AGSPC2 Small Cap Growth............. - - 469,456 9,303,218 Reinvestment of distributions........... 11,278 182,974 45,510 762,287 Redeemed................ (33,565) (598,912) (133,113) (2,503,418) --------- ----------- ---------- ------------ Net increase/(decrease).... 163,675 $3,016,226 816,824 $15,868,689 --------- ----------- ---------- ------------ Class A Class B Class C ---------------------- ----------------------- ------------------------ Small Cap Index Sold.................... 23,750 $275,800 96,627 $1,116,799 3,483 $39,259 Reinvestment of distributions........... 70,177 702,455 88,320 874,356 337 3,142 Redeemed................ (13,488) (156,325) (21,268) (240,302) --------- ---------- --------- ----------- ---------- ------------ Net increase/(decrease).... 80,439 $821,930 163,679 $1,750,853 3,820 $42,401 --------- ---------- --------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ Socially Responsible Sold.................... 28,809 $352,586 89,213 $1,088,674 Reinvestment of distributions........... 6,476 78,486 11,019 133,425 Redeemed................ (12,932) (157,649) (35,336) (424,336) --------- ----------- ---------- ------------ Net increase/(decrease).... 22,353 $273,423 64,896 $797,763 --------- ----------- ---------- ------------ Class C Class I Class II ---------------------- ----------------------- ------------------------ Socially Responsible Sold.................... 4,696 $59,576 852,292 $10,531,657 8 $100 Reinvestment of distributions........... - 8,931 108,358 5,774 70,009 Redeemed................ (533,794) (6,608,539) (132,317) (1,631,480) --------- ---------- --------- ----------- ---------- ------------ Net increase/(decrease).... 4,696 $59,576 327,429 $4,031,476 (126,535) ($1,561,371) --------- ---------- --------- ----------- ---------- ------------ Class A Class B Class C ---------------------- ----------------------- ------------------------ Stock Index Sold.................... 257,610 $3,300,025 1,030,761 $13,150,515 39,852 $506,404 Reinvestment of distributions........... 7,328 94,341 11,656 148,815 1 19 Redeemed................ (52,165) (667,516) (296,871) (3,762,586) --------- ---------- --------- ----------- ---------- ------------ Net increase/(decrease).... 212,773 $2,726,850 745,546 $9,536,744 39,853 $506,423 --------- ---------- --------- ----------- ---------- ------------ Class A Class B Class C ---------------------- ----------------------- ------------------------ Global Equity Sold.................... 561,515 $6,564,695 61,443 $779,179 2,354,014 $29,022,558 Reinvestment of distributions........... 102,952 1,452,654 223,719 3,087,303 391,138 5,421,137 Redeemed................ (676,962) (8,745,579) (952,125) (12,058,568) (3,783,257) (47,863,041) --------- ---------- --------- ----------- ---------- ------------ Net increase/(decrease).... (12,495) ($728,230) (666,963) ($8,192,086) (1,038,105) ($13,419,346) --------- ---------- --------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ International Equity Sold.................... 752,978 $8,539,000 223,968 $2,565,738 Shares issued in connection with the merger of AGSPC2 International Growth... 241,933 2,836,359 540,423 6,262,957 Shares issued in connection with the merger of AGSPC2 International Value.... 275,839 3,233,635 577,643 6,694,306 Reinvestment of distributions........... 27,241 318,993 85,506 992,722 Redeemed................ (921,853) (10,575,559) (883,545) (10,072,806) --------- ----------- ---------- ------------ Net increase/(decrease).... 376,138 $4,352,428 543,995 $6,442,917 --------- ----------- ---------- ------------
125 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital --------- ----------- ---------- ------------ ---------- ----------- Class C Class I ------------------------ ----------------------- International Equity Sold.................... 162,734 $1,895,481 998,106 $11,225,802 Shares issued in connection with the merger of AGSPC2 International Growth... - - 362,776 4,259,720 Shares issued in connection with the merger of AGSPC2 International Value.... - - 505,421 5,934,659 Reinvestment of distributions........... 40,660 472,060 - - Redeemed................ (310,335) (3,546,141) (276,032) (2,977,809) ---------- ------------ ---------- ----------- Net increase/(decrease).... (106,941) ($1,178,600) 1,590,271 $18,442,372 ---------- ------------ ---------- ----------- Class A Class B Class C ----------------------- ------------------------ ----------------------- International Small Cap Sold.................... 617,132 $15,273,632 302,823 $7,405,887 354,827 $9,376,657 Reinvestment of distributions........... 28,290 633,967 75,949 1,644,481 61,882 1,343,520 Redeemed................ (455,514) (11,482,589) (149,996) (3,534,129) (207,100) (4,854,566) --------- ----------- ---------- ------------ ---------- ----------- Net increase/(decrease).... 189,908 $4,425,010 228,776 $5,516,239 209,609 $5,865,611 --------- ----------- ---------- ------------ ---------- ----------- Class A Class B ------------------------ ----------------------- Balanced Sold.................... 239,789 $2,221,399 169,192 $1,578,042 Shares issued in connection with the merger of AGSPC2 Balanced............... 260,076 2,429,626 850,413 7,900,334 Reinvestment of distributions........... 97,337 845,859 207,921 1,802,749 Redeemed................ (320,654) (2,974,969) (898,843) (8,259,026) ---------- ------------ ---------- ----------- Net increase/(decrease).... 276,548 $2,521,915 328,683 $3,022,099 ---------- ------------ ---------- ----------- Class C Class I ------------------------ ----------------------- Balanced Sold.................... 147,231 $1,400,824 206,780 $1,973,415 Shares issued in connection with the merger of AGSPC2 Balanced............... 448,772 4,196,897 Reinvestment of distributions.......... 787,946 6,942,381 Redeemed................ (2,057,592) (19,112,110) (28,756) (271,671) ---------- ------------ ---------- ----------- Net increase/(decrease)... (1,122,415) ($10,768,905) 626,796 $5,898,641 ---------- ------------ ---------- ----------- Class A Class B ------------------------ ----------------------- Core Bond Sold.................... 86,061 $836,397 61,183 $592,169 Shares issued in connection with the merger of AGSPC2 Core Bond................... 18,563 178,964 49,200 474,337 Shares issued in connection with the merger of AGSPC2 Domestic Bond.......... 340,668 3,284,382 1,140,806 10,998,835 Reinvestment of distributions.......... 18,168 175,504 24,870 240,124 Redeemed................ (417,481) (4,015,632) (1,197,400) (11,469,196) ---------- ------------ ---------- ----------- Net increase/(decrease)... 45,979 $459,615 78,659 $836,269 ---------- ------------ ---------- -----------
126 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital --------- ----------- ---------- ----------- ---------- ------------ Class C Class I Class II ----------------------- ----------------------- ------------------------ Core Bond Sold.................... 46,061 $448,966 1,808,854 $17,383,782 8 $75 Shares issued in connection with the merger of AGSPC2 Core Bond................... - - 23,609 235,590 33,038,051 318,569,797 Shares issued in connection with the merger of AGSPC2 Domestic Bond.......... - - 693,472 6,688,535 - - Reinvestment of distributions.......... 19,488 188,367 40,452 391,593 700,635 6,764,917 Redeemed................ (242,315) (2,350,556) (491,180) (4,754,531) (622,731) (6,000,000) --------- ----------- ---------- ----------- ---------- ------------ Net increase/(decrease)... (176,766) ($1,713,223) 2,075,207 $19,937,089 33,115,963 $319,334,789 --------- ----------- ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ High Yield Bond Sold.................... 32,163 $300,163 122,781 $1,123,161 Reinvestment of distributions.......... 1,170 10,572 8,193 73,989 Redeemed................ (3,512) (33,029) (13,772) (123,026) ---------- ----------- ---------- ------------ Net increase/(decrease)... 29,821 $277,706 117,202 $1,074,124 ---------- ----------- ---------- ------------ Class C Class I Class II ----------------------- ----------------------- ------------------------ High Yield Bond Sold.................... 63,079 $567,367 1,605 $14,414 7,091,254 $63,681,758 Reinvestment of distributions.......... 601 5,208 150 1,368 704,361 6,390,330 Redeemed................ - - (1,596) (14,336) (7,088,114) (63,648,633) --------- ----------- ---------- ----------- ---------- ------------ Net increase/(decrease)... 63,680 $572,575 159 $1,446 707,501 $6,423,455 --------- ----------- ---------- ----------- ---------- ------------ Class A Class B Class C ----------------------- ----------------------- ------------------------ Municipal Bond Sold.................... 138,950 $1,317,668 9,870 $94,254 1,628 $15,403 Shares issued in connection with the merger of AGSPC2 Municipal Bond......... 344,682 3,290,627 414,403 3,955,889 - - Reinvestment of distributions.......... 16,903 160,992 13,996 133,257 7,966 75,353 Redeemed................ (162,218) (1,539,938) (215,733) (2,051,175) (185,975) (1,760,691) --------- ----------- ---------- ----------- ---------- ------------ Net increase/(decrease)... 338,317 $3,229,349 222,536 $2,132,225 (176,381) ($1,669,935) --------- ----------- ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ Strategic Income - ---------------- Sold.................... 235,425 $1,934,596 188,191 $1,554,585 Shares issued in connection with the merger of AGSPC2 Strategic Bond......... 210,906 1,732,804 266,623 2,190,838 Reinvestment of distributions........... 53,247 440,576 118,611 981,318 Redeemed................ (765,027) (6,343,100) (1,218,211) (10,106,970) ---------- ----------- ---------- ------------ Net increase/(decrease)... (265,449) ($2,235,124) (644,786) ($5,380,229) ---------- ----------- ---------- ------------ Class C Class I ----------------------- ------------------------ Strategic Income - ---------------- Sold.................... 194,141 $1,597,500 $9 $75 Shares issued in connection with the merger of AGSPC2 Strategic Bond......... - - 328,991 2,705,249 Reinvestment of distributions........... 110,714 916,823 8,751 69,194 Redeemed................ (1,138,865) (9,482,491) (8,294) (67,939) ---------- ----------- ---------- ------------ Net increase/(decrease)... (834,010) ($6,968,168) 329,457 ($2,706,579) ---------- ----------- ---------- ------------
127 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ---------- ----------- ----------- ----------- ----------- ----------- Class A Class B Class C ----------------------- ------------------------- ------------------------- U.S. Government Securities - --------------- Sold.................... 260,706 $2,454,069 251,432 $2,371,338 2,953,663 $27,736,875 Reinvestment of distributions........... 132,162 1,124,755 41,149 348,322 44,282 374,449 Redeemed................ (994,682) (9,334,232) (675,339) (6,148,543) (3,404,934) (31,970,103) ---------- ----------- ----------- ----------- ----------- ----------- Net increase/(decrease)... (601,814) ($5,755,408) (382,758) ($3,428,883) (406,989) ($3,858,779) ---------- ----------- ----------- ----------- ----------- ----------- Class A Class B ------------------------- ------------------------- Money Market - ------------ Sold.................... 35,256,844 $35,256,844 10,939,422 $10,939,422 Shares issued in connection with the merger of AGSPC2 Money Market................. 16,037,970 16,037,970 4,757,994 4,757,994 Reinvestment of distributions........... 732,440 732,440 268,711 268,711 Redeemed................ (32,448,147) (32,448,147) (12,420,665) (12,420,665) ----------- ----------- ----------- ----------- Net increase/(decrease)... 19,579,107 $19,579,107 3,545,462 $3,545,462 ----------- ----------- ----------- ----------- Class C Class I ------------------------- ------------------------- Money Market - ------------ Sold.................... 30,703,970 $30,703,970 2,867,349 $2,867,349 Shares issued in connection with the merger of AGSPC2 Money Market................. 5,610,626 5,610,626 Reinvestment of distributions........... 371,257 371,257 108,376 108,376 Redeemed................ (32,524,278) (32,524,278) (2,475,554) (2,461,485) ----------- ----------- ----------- ----------- Net increase/(decrease)... (1,449,051) ($1,449,051) 6,110,797 $6,124,866 ----------- ----------- ----------- ----------- Class A Class B Class C ----------------------- ------------------------- ------------------------- Municipal Money Market - ---------------------- Sold.................... 2,115,643 $2,115,642 416,013 $416,013 112,080 $112,080 Reinvestment of distributions........... 86,176 86,176 43,881 43,882 235 235 Redeemed................ (1,401,118) (1,401,118) (524,290) (524,290) (4,000) (4,000) ---------- ----------- ----------- ----------- ----------- ----------- Net increase/(decrease)... 800,701 $800,700 (64,396) ($64,395) 108,314 $108,314 ---------- ----------- ----------- ----------- ----------- ----------- Class A Class B ------------------------- ------------------------- Aggressive Growth LifeStyle - ----------------- Sold.................... 154,794 $2,051,325 657,584 $8,804,810 Reinvestment of distributions........... 19,409 250,862 58,467 692,034 Redeemed................ (16,440) (218,429) (72,094) (957,709) ----------- ----------- ----------- ----------- Net increase/(decrease)... 157,763 $2,083,758 643,957 $8,539,135 ----------- ----------- ----------- ----------- Class C Class I Class II ----------------------- ------------------------- ------------------------- Aggressive Growth LifeStyle - ----------------- Sold.................... 14,397 $188,274 629,278 $8,586,698 8 $100 Reinvestment of distributions........... 21,903 282,055 5,380 71,165 Redeemed................ (387,895) (5,353,647) (131,036) (1,765,000) ---------- ----------- ----------- ----------- ----------- ----------- Net increase/(decrease)... 14,397 $188,274 263,286 $3,515,106 (125,648) ($1,693,735) ---------- ----------- ----------- ----------- ----------- ----------- Class A Class B ------------------------- ------------------------- Moderate Growth LifeStyle Sold.................... 118,463 $1,454,170 538,571 $6,583,591 Reinvestment of distributions........... 15,307 185,162 46,680 565,594 Redeemed................ (20,669) (251,696) (91,454) (1,118,453) ----------- ----------- ----------- ----------- Net increase/(decrease)... 113,101 $1,387,636 493,797 $6,030,732 ----------- ----------- ----------- -----------
128 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ---------- ------------ --------- ----------- ---------- ----------- Class C Class I Class II ------------------------ ----------------------- ----------------------- Moderate Growth LifeStyle Sold..................... 15,078 $188,489 740,368 $9,290,421 8 $100 Reinvestment of distributions............ 16 187 18,336 221,379 4,909 59,749 Redeemed................. (442,764) (5,612,543) (131,311) (1,628,183) ---------- ------------ --------- ----------- ---------- ----------- Net increase/(decrease)..... 15,094 $188,676 315,940 $3,899,257 (126,394) ($1,568,344) ---------- ------------ --------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Conservative Growth LifeStyle Sold..................... 132,543 $1,548,028 363,073 $4,240,024 Reinvestment of distributions............ 12,294 141,683 40,395 466,977 Redeemed................. (11,888) (138,955) (44,929) (528,305) --------- ----------- ---------- ----------- Net increase/(decrease)..... 132,949 $1,550,756 358,539 $4,178,696 --------- ----------- ---------- ----------- Class C Class I Class II ------------------------ ----------------------- ----------------------- Conservative Growth LifeStyle Sold..................... 12,844 $152,493 662,195 $7,849,117 9 $100 Reinvestment of distributions............ 14,757 170,114 4,837 55,734 Redeemed................. (426,915) (5,103,384) (132,197) (1,547,920) ---------- ------------ --------- ----------- ---------- ----------- Net increase/(decrease)..... 12,844 $152,493 250,037 $2,915,847 (127,351) ($1,492,086) ---------- ------------ --------- ----------- ---------- ----------- Share activity for the year ended October 31, 1999, was as follows: Shares Capital Shares Capital Shares Capital ---------- ------------ --------- ----------- ---------- ----------- Class A Class B Class C ------------------------ ----------------------- ----------------------- Growth and Income Sold..................... 593,218 $16,112,290 1,020,665 $27,330,906 1,567,435 $42,427,008 Reinvestment of distributions............ 64,085 1,621,392 114,011 2,851,439 176,921 4,442,490 Redeemed................. (1,133,085) (31,765,735) (579,899) (15,547,216) (1,325,973) (35,951,361) ---------- ------------ --------- ----------- ---------- ----------- Net increase/(decrease)..... (475,782) ($14,032,053) 554,777 $14,635,129 418,383 $10,918,137 ---------- ------------ --------- ----------- ---------- ----------- Class A Class B Class C ------------------------ ----------------------- ----------------------- Large Cap Growth (formerly Growth Equity) Sold..................... 121,585 $2,413,151 281,502 $5,559,694 393,750 $7,688,421 Reinvestment of distributions............ 14,236 259,959 39,479 708,254 45,768 820,167 Redeemed................. (92,961) (1,834,145) (169,645) (3,324,990) (252,763) (4,961,227) ---------- ------------ --------- ----------- ---------- ----------- Net increase/(decrease)..... 42,860 $838,965 151,336 $2,942,958 186,755 $3,547,361 ---------- ------------ --------- ----------- ---------- ----------- Class A Class B Class C ------------------------ ----------------------- ----------------------- Mid Cap Growth (formerly Small/ Mid Cap) Sold..................... 126,496 $2,275,849 291,328 $5,096,560 542,798 $9,521,511 Reinvestment of distributions............ 25,158 411,088 78,912 1,259,456 86,436 1,382,112 Redeemed................. (128,546) (2,337,709) (301,084) (5,259,240) (605,710) (10,637,501) ---------- ------------ --------- ----------- ---------- ----------- Net increase/(decrease)..... 23,108 $349,228 69,156 $1,096,776 23,524 $266,122 ---------- ------------ --------- ----------- ---------- ----------- Class A Class B ------------------------ ----------------------- Mid Cap Value Sold..................... 148,430 $1,533,854 392,956 $4,546,587 Reinvestment of distributions............ 576 6,387 222 2,384 Redeemed................. (4,845) (63,601) (8,871) (112,567) ---------- ------------ --------- ----------- Net increase/(decrease)..... 144,161 $1,476,640 384,307 $4,436,404 ---------- ------------ --------- -----------
129 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ---------- ------------ --------- ----------- ---------- ------------ Class I Class II ------------------------ ----------------------- Mid Cap Value Sold.................... 129,332 $1,304,099 125,228 $1,253,837 Reinvestment of distributions........... 707 7,954 1,065 12,263 Redeemed................ (4,055) (53,401) (4,480) (59,463) ---------- ------------ --------- ----------- Net increase/(decrease).... 125,984 $1,258,652 121,813 $1,206,637 ---------- ------------ --------- ----------- Class A Class B Class C ------------------------ ----------------------- ------------------------ Small Cap Growth (formerly Emerging Growth) Sold.................... 15,516 $160,205 49,363 $491,033 23,740 $251,163 Redeemed................ (14,536) (152,525) (26,577) (268,051) (15,638) (158,481) ---------- ------------ --------- ----------- ---------- ------------ Net increase/(decrease).... 980 $7,680 22,786 $222,982 8,102 $92,682 ---------- ------------ --------- ----------- ---------- ------------ Class A Class B ------------------------ ----------------------- Small Cap Index Sold.................... 260,137 $2,618,550 304,191 $3,102,682 Reinvestment of distributions........... 2,928 26,235 598 6,607 Redeemed................ (471) (5,219) (290) (3,313) ---------- ------------ --------- ----------- Net increase/(decrease).... 262,594 $2,639,566 304,499 $3,105,976 ---------- ------------ --------- ----------- Class A Class B ------------------------ ----------------------- Socially Responsible Sold.................... 135,640 $1,376,465 242,494 $2,630,795 Reinvestment of distributions........... 1,097 12,708 206 2,271 Redeemed................ -- -- (309) (3,518) ---------- ------------ --------- ----------- Net increase/(decrease).... 136,737 $1,389,173 242,391 $2,629,548 ---------- ------------ --------- ----------- Class I Class II ------------------------ ----------------------- Socially Responsible Sold.................... 179,786 $1,923,909 124,875 $1,248,750 Reinvestment of distributions........... 1,401 16,322 1,535 17,856 Redeemed................ (8,751) (100,865) - - ---------- ------------ --------- ----------- Net increase/(decrease).... 172,436 $1,839,366 126,410 $1,266,606 ---------- ------------ --------- ----------- Class A Class B ------------------------ ----------------------- Stock Index Sold.................... 463,951 $5,084,388 1,247,810 $14,353,724 Reinvestment of distributions........... 3,454 41,504 2,069 24,958 Redeemed................ (10,183) (120,851) (20,813) (243,829) ---------- ------------ --------- ----------- Net increase/(decrease).... 457,222 $5,005,041 1,229,066 $14,134,853 ---------- ------------ --------- ----------- Class A Class B Class C ------------------------ ----------------------- ------------------------ Global Equity Sold.................... 1,423,394 $22,816,700 129,757 $2,083,840 1,897,782 $30,883,719 Reinvestment of distributions........... 142,681 2,268,622 131,730 2,068,160 255,619 4,026,003 Redeemed................ (2,665,234) (42,997,272) (522,562) (8,405,115) (2,853,048) (46,324,542) ---------- ------------ --------- ----------- ---------- ------------ Net increase/(decrease).... (1,099,159) ($17,911,950) (261,075) ($4,253,115) (699,647) ($11,414,820) ---------- ------------ --------- ----------- ---------- ------------ Class A Class B Class C ------------------------ ----------------------- ------------------------ International Equity Sold.................... 88,662 $974,431 180,051 $1,967,284 96,884 $1,067,562 Reinvestment of distributions........... 1,100 11,388 3,861 39,697 2,310 23,747 Redeemed................ (137,110) (1,500,053) (404,482) (4,414,104) (344,573) (3,768,194) ---------- ------------ --------- ----------- ---------- ------------ Net increase/(decrease).... (47,348) ($514,234) (220,570) ($2,407,123) (245,379) ($2,676,885) ---------- ------------ --------- ----------- ---------- ------------
130 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ---------- ------------ ---------- ----------- ---------- ------------ Class A Class B Class C ------------------------ ----------------------- ------------------------ International Small Cap Sold.................... 20,122 $317,282 55,279 $858,748 45,908 $706,902 Redeemed................ (53,744) (845,699) (169,869) (2,632,560) (174,307) (2,683,477) ---------- ------------ ---------- ----------- ---------- ------------ Net increase/(decrease).... (33,622) ($528,417) (114,590) ($1,773,812) (128,399) ($1,976,575) ---------- ------------ ---------- ----------- ---------- ------------ Class A Class B Class C ------------------------ ----------------------- ------------------------ Balanced Sold.................... 156,485 $1,680,266 113,675 $1,223,061 323,739 $3,527,724 Reinvestment of distributions........... 124,734 1,332,156 143,215 1,528,102 483,841 5,230,466 Redeemed................ (975,179) (10,544,849) (587,122) (6,295,079) (1,398,327) (15,170,133) ---------- ------------ ---------- ----------- ---------- ------------ Net increase/(decrease).... (693,960) ($7,532,427) (330,232) ($3,543,916) (590,747) ($6,411,943) ---------- ------------ ---------- ----------- ---------- ------------ Class A Class B Class C ------------------------ ----------------------- ------------------------ Core Bond (formerly Investment Quality Bond) Sold.................... 69,728 $725,581 157,085 $1,652,116 128,622 $1,337,848 Reinvestment of distributions........... 28,223 291,270 23,317 239,071 27,756 284,636 Redeemed................ (374,751) (3,799,199) (200,439) (2,081,049) (210,799) (2,141,915) ---------- ------------ ---------- ----------- ---------- ------------ Net increase/(decrease).... (276,800) ($2,782,348) (20,037) ($189,862) (54,421) ($519,431) ---------- ------------ ---------- ----------- ---------- ------------ Class A Class B ------------------------ ----------------------- High Yield Bond Sold.................... 127,950 $1,278,928 191,330 $1,913,973 Reinvestment of distributions........... 538 5,377 2,309 22,587 Redeemed................ (124,988) (1,251,086) (124,580) (1,246,996) ---------- ------------ ---------- ----------- Net increase/(decrease).... 3,500 $33,219 69,059 $689,564 ---------- ------------ ---------- ----------- Class I Class II ------------------------ ----------------------- Sold.................... 124,875 $1,248,449 6,217,232 $62,127,399 Reinvestment of distributions........... 486 4,873 537,322 5,345,983 Redeemed................ (124,000) (1,241,240) (125,000) (1,251,250) ---------- ------------ ---------- ----------- Net increase/(decrease).... 1,361 $12,082 6,629,554 $66,222,132 ---------- ------------ ---------- ----------- Class A Class B Class C ------------------------ ----------------------- ------------------------ Municipal Bond (formerly National Municipal Bond) Sold.................... 12,373 $121,276 38,617 $389,927 58,284 $590,526 Reinvestment of distributions........... 13,971 138,776 11,804 117,251 12,945 128,980 Redeemed................ (128,078) (1,256,715) (123,709) (1,221,515) (160,321) (1,597,610) ---------- ------------ ---------- ----------- ---------- ------------ Net increase/(decrease).... (101,734) ($996,663) (73,288) ($714,337) (89,092) ($878,104) ---------- ------------ ---------- ----------- ---------- ------------ Class A Class B Class C ------------------------ ----------------------- ------------------------ Strategic Income Sold.................... 355,037 $3,163,049 470,944 $4,269,053 212,534 $1,899,105 Reinvestment of distributions........... 80,202 708,185 151,925 1,339,782 195,047 1,722,274 Redeemed................ (1,065,074) (9,458,644) (1,333,186) (11,782,693) (1,669,529) (14,600,123) ---------- ------------ ---------- ----------- ---------- ------------ Net increase/(decrease).... (629,835) ($5,587,410) (710,317) ($6,173,858) (1,261,948) ($10,978,744) ---------- ------------ ---------- ----------- ---------- ------------ Class A Class B Class C ------------------------ ----------------------- ------------------------ U.S. Government Securities Sold.................... 418,180 $4,109,724 316,176 $3,095,258 3,441,704 $33,633,113 Reinvestment of distributions........... 160,487 1,575,298 43,417 425,351 49,911 488,789 Redeemed................ (1,798,945) (17,585,651) (872,536) (8,630,181) (3,625,489) (35,381,313) ---------- ------------ ---------- ----------- ---------- ------------ Net increase/(decrease).... (1,220,278) ($11,900,629) (512,943) ($5,109,572) (133,874) ($1,259,411) ---------- ------------ ---------- ----------- ---------- ------------
131 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ----------- ----------- ----------- ----------- ----------- ----------- Class A Class B Class C ------------------------ ------------------------ ------------------------ Money Market Sold.................... 35,775,604 $35,777,032 11,223,162 $11,223,619 29,891,743 $29,892,797 Reinvestment of distributions........... 335,040 335,040 197,442 197,442 334,268 334,268 Redeemed................ (40,376,812) (40,376,812) (12,789,186) (12,789,186) (29,820,314) (29,820,314) ----------- ----------- ----------- ----------- ----------- ----------- Net increase/(decrease).... (4,266,168) ($4,264,740) (1,368,582) ($1,368,125) 405,697 $406,751 ----------- ----------- ----------- ----------- ----------- ----------- Class A Class B ------------------------ ------------------------ Municipal Money Market Sold.................... 3,984,748 $3,984,748 2,853,653 $2,853,653 Reinvestment of distributions........... 61,818 61,818 37,545 37,545 Redeemed................ (397,687) (397,687) (52,777) (52,777) ----------- ----------- ----------- ----------- Net increase/(decrease).... 3,648,879 $3,648,879 2,838,421 $2,838,421 ----------- ----------- ----------- -----------
4. PURCHASES AND SALES OF SECURITIES. The following table summarizes the securities transactions (excluding short-term investments) for all portfolios, excluding Money Market and Municipal Money Market, for the year ended October 31, 2000:
Purchases Sales ----------------------------- ----------------------------- Portfolio U. S. Government Other Issues U. S. Government Other Issues - ------------ ---------------- ------------ ---------------- ------------ Growth & Income......... 96,856,401 147,789,341 Large Cap Growth........ 132,306,760 119,052,705 Mid Cap Growth.......... 123,564,828 122,782,509 Mid Cap Value........... 35,304,304 27,022,661 Science & Technology.... 35,634,930 12,582,894 Small Cap Growth........ 37,345,942 29,341,776 Small Cap Index......... 5,381,573 4,333,794 Socially Responsible.... 5,820,835 4,688,870 Stock Index............. 12,342,382 534,703 Global Equity........... 115,123,896 145,722,036 International Equity.... 40,024,143 42,661,466 International Small Cap..................... 159,704,967 149,108,657 Balanced................ 12,160,455 126,721,037 36,384,795 122,959,723 Core Bond............... 412,533,912 131,888,498 377,949,865 165,177,209 High Yield Bond......... 59,539,068 54,597,751 Municipal Bond.......... 5,958,797 9,165,993 Strategic Income........ 5,260,240 26,451,647 6,149,304 44,385,302 U.S. Government Securities.............. 190,950,568 195,276,034 Aggressive Growth LifeStyle............... 30,908,194 16,896,907 Moderate Growth LifeStyle............... 25,457,036 14,907,463 Conservative Growth LifeStyle............... 20,809,977 13,169,011
132 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 4 - continued At October 31, 2000, tax basis net unrealized appreciation was equal to the aggregate gross unrealized appreciation for all securities in which there was an excess of market value over tax cost and aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over market value as follows:
Tax Basis Net Unrealized Tax Basis Tax Basis Tax Basis Appreciation Unrealized Unrealized Portfolio Cost (Depreciation) Appreciation Depreciation --------- ----------- -------------- ------------ ------------ Growth & Income.......... 247,932,307 85,368,517 104,439,571 (19,071,054) Large Cap Growth......... 86,034,499 155,314 7,660,592 (7,505,278) Mid Cap Growth........... 70,018,306 7,093,375 14,892,412 (7,799,037) Mid Cap Value............ 20,055,109 2,869,394 3,204,459 (335,065) Science & Technology..... 23,509,569 (1,425,801) 1,189,449 (2,615,250) Small Cap Growth......... 37,676,128 1,261,166 5,657,982 (4,396,816) Small Cap Index.......... 8,448,238 (494,577) 1,248,190 (1,742,767) Socially Responsible..... 10,635,411 976,085 1,855,499 (879,414) Stock Index.............. 32,114,542 2,027,573 4,792,834 (2,765,261) Global Equity............ 37,198,232 (300,206) 3,131,657 (3,431,863) International Equity..... 50,818,941 (2,838,520) 2,553,346 (5,391,866) International Small Cap.. 26,786,141 22,482 1,632,838 (1,610,356) Balanced................. 63,304,758 3,495,827 5,358,679 (1,862,852) Core Bond................ 434,296,792 (2,395,530) 2,928,847 (5,324,377) High Yield Bond.......... 63,189,171 (6,658,028) 891,189 (7,549,217) Municipal Bond........... 16,577,811 (54,068) 268,291 (322,359) Strategic Income......... 39,433,399 (2,552,647) 769,404 (3,322,051) U.S. Government Securities............... 61,795,977 (543,713) 30,606 (574,319) Aggressive Growth LifeStyle................ 25,212,681 (2,065,882) 171,981 (2,237,863) Moderate Growth LifeStyle................ 22,014,065 (1,112,691) 169,513 (1,282,204) Conservative Growth LifeStyle................ 19,125,531 (829,073) 112,827 (941,900)
5. INVESTMENT ADVISORY AGREEMENTS. The Fund maintains an Investment Advisory Agreement with AGAM, pursuant to approval by the Fund's Board of Trustees and Fund shareholders. AGAM is responsible for managing the corporate and business affairs of the Fund and for selecting and compensating subadvisers to handle the investment and reinvestment of the assets of each portfolio, subject to the supervision of the Trustees of the Fund. As compensation for its services, AGAM receives a fee from the Fund computed separately for each portfolio at an annual percentage of average net assets as follows:
Between Between $50 million $200 million First and $200 and $500 Excess over Portfolio $50 million million million $500 million --------- ------------ ----------- ------------ ------------ Growth & Income............ .725% .675% .625% .550% Large Cap Growth........... .900% .850% .825% .800% Mid Cap Growth............. .925% .900% .875% .850% Mid Cap Value.............. See below/1/ Science & Technology....... .900% .900% .900% .900% Small Cap Growth........... .950% .950% .950% .950% Small Cap Index............ .280% .280% .280% .270% Socially Responsible/4/.... .650% .650% .650% .650% Stock Index................ .270% .270% .270% .260% Global Equity.............. .900% .900% .700% .700% International Equity....... .900% .850% .800% .750% International Small Cap.... 1.050% 1.000% .900% .800% Balanced................... .775% .725% .675% .625% Aggressive Growth LifeStyle.................. .100% .100% .100% .100% Moderate Growth LifeStyle.. .100% .100% .100% .100% Conservative Growth LifeStyle.................. .100% .100% .100% .100%
133 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 5 - continued
Between Between $50 million $200 million First and $200 and $500 Excess over Portfolio $50 million million million $500 million - ------------ ----------- ----------- ------------ ------------ Core Bond............... .600% .600% .525% .475% High Yield Bond/2/...... .825% .825% .725% .675% Municipal Bond.......... .600% .600% .600% .600% Strategic Income........ .750% .700% .650% .600% U. S. Government Securities.............. .600% .600% .525% .475% Money Market............ .200% .200% .200% .145% Municipal Money Market/3/............... .350% .350% .350% .350%
/1/The Management fee schedule for the Mid Cap Value Fund from July 7, 2000 is as follows: 0.900% on the first $100 million, 0.875% between $100 million and $250 million, 0.850% between $250 million and $500 million, 0.825% between $500 million and $750 million, and 0.800% on the excess over $750 million of the average net assets of the Fund. Prior to that date, the Management fee was as follows: 0.750% on the first $100 million, 0.725% between $100 million and $250 million, 0.700% between $250 million and $500 million, 0.675% between $500 million and $750 million, and 0.650% on the excess over $750 million of the average net assets of the Fund. /2/Prior to July 7, 2000, the Management fee schedule for High Yield Bond was as follows: 0.700% on the first $200 million, 0.600% between $200 million and $500 million and 0.450% on the excess over $500 million of the average net assets of the Fund. /3/Prior to July 7, 2000, the Management fee schedule for Municipal Money Market was as follows: 0.500% on the first $200 million, 0.450% between $200 million and $500 million and 0.400% on the excess over $500 million of the average net assets of the Fund. /4/Prior to July 7, 2000, the management fee for Socially Responsible was 0.25% of average net assets. Prior to March 10, 2000, The Variable Annuity Life Insurance Company ("VALIC") served as investment adviser for Mid Cap Value, Science & Technology, Small Cap Index, Socially Responsible, Stock Index, High Yield Bond and Municipal Money Market. Advisory fee rates payable to CAM and VALIC prior to March 10, 2000, were the same as those payable under the current advisory agreement with AGAM except as noted in the footnotes to the chart below. For the year ended October 31, 2000, AGAM paid aggregate subadvisory fees of $3,481,904. In addition, AGAM retained net investment advisory fees of $3,825,317 after payment of subadvisory fees, which were allocated among the portfolios as follows:
% of Net % of Net Fee Assets Fee Assets Paid to Paid to Retained by Retained by Portfolio Sub-adviser Sub-adviser AGAM AGAM - ------------ ----------- ----------- ----------- ----------- Growth & Income......... $831,412 0.27% $1,255,216 0.40% Large Cap Growth........ 313,631 0.49% 258,254 0.40% Mid Cap Growth.......... 316,341 0.53% 238,731 0.40% Mid Cap Value........... 75,402 0.50% 47,071 0.31% Science & Technology.... 55,886 0.60% 28,304 0.30% Small Cap Growth........ 80,730 0.55% 58,712 0.40% Small Cap Index......... 768* 0.01% 21,193 0.27% Socially Responsible.... 9,029* 0.09% 30,144 0.30% Stock Index............. 2,047* 0.01% 74,470 0.26% Global Equity........... 285,818 0.49% 238,061 0.41% International Equity.... 165,746 0.50% 133,355 0.40% International Small Cap..................... 173,739 0.57% 146,471 0.48% Balanced................ 231,868 0.37% 254,433 0.40% Core Bond............... 265,944* 0.23% 397,496 0.34% High Yield Bond......... 290,743* 0.45% 189,422 0.29% Municipal Bond.......... 31,952* 0.25% 44,923 0.35% Strategic Income........ 150,251* 0.35% 171,750 0.40% U. S. Government Securities.............. 112,544* 0.23% 187,566 0.38% Money Market............ 21,204* 0.08% 35,122 0.12% Municipal Money Market.. 18,324* 0.25% 14,623 0.20% Aggressive Growth LifeStyle............... 17,053* 0.10% - - Moderate Growth LifeStyle............... 16,346* 0.10% - - Conservative Growth LifeStyle............... 15,126* 0.10% - -
* Fund is sub-advised by AGIM, a wholly owned indirect subsidiary of American General Corporation. 134 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 5 - continued Expense Reimbursement and Distribution Plan. Pursuant to the Investment Advisory Agreement, effective July 7, 2000, AGAM will reduce the advisory fee, or, if necessary, reimburse each portfolio of the Fund for expenses (excluding taxes, portfolio brokerage commissions, interest, certain litigation and indemnification expenses and extraordinary expenses) incurred through February 28, 2001 in excess of the following annual percentages of average net assets as highlighted in the table below. (Expense limitation).
Class A Class B Class C Class I Class II ------- ------- ------- ------- -------- Growth & Income....................... 1.46% 2.11% 2.11% 1.23% Large Cap Growth...................... 1.17% 1.82% 1.82% 1.07% Mid Cap Growth........................ 1.48% 2.13% 2.13% 1.38% Mid Cap Value......................... 1.78% 2.43% 2.43% 1.68% Science & Technology.................. 1.10% 1.75% 1.75% 1.00% Small Cap Growth...................... 1.22% 1.87% 1.87% 1.12% Small Cap Index....................... 1.00% 1.65% 1.65% 0.90% Socially Responsible.................. 1.20% 1.85% 1.85% 1.10% Stock Index........................... 0.70% 1.35% 1.35% 0.60% Global Equity......................... 1.87% 2.52% 2.52% 1.65% International Equity.................. 1.50% 2.15% 2.15% 1.40% International Small Cap............... 1.85% 2.50% 2.50% 1.75% Balanced.............................. 1.51% 2.16% 2.16% 1.41% Core Bond............................. 1.30% 1.95% 1.95% 1.20% 0.95% High Yield Bond....................... 1.55% 2.20% 2.20% 1.45% 1.13% Municipal Bond........................ 1.00% 1.85% 1.85% Strategic Income...................... 1.55% 2.20% 2.20% 1.45% U. S. Government Securities........... 1.25% 1.90% 1.90% 1.15% Money Market.......................... 0.70% 0.70% 0.70% 0.70% Municipal Money Market................ 0.75% 0.75% 0.75% Aggressive Growth LifeStyle........... 0.20% 0.85% 0.85% 0.10% Moderate Growth LifeStyle............. 0.20% 0.85% 0.85% 0.10% Conservative Growth LifeStyle......... 0.20% 0.85% 0.85% 0.10%
The Fund has adopted a distribution plan (the "Plan") pursuant to Rule 12b-1 under the Investment Company Act of 1940 to use its assets to finance certain activities relating to the distribution of its shares to investors. The Plan is a "compensation" plan providing for the payment by each portfolio, other than Money Market and Municipal Money Market, of a monthly distribution fee to AGAM as principal underwriter for the Fund as follows: Class A 0.0035% of average daily net assets, except for Municipal Bond, which charges 0.0015% of average daily net assets Class B 0.0100% of average daily net assets Class C 0.0100% of average daily net assets
The amounts payable by Aggressive Growth LifeStyle, Moderate Growth LifeStyle and Conservative Growth LifeStyle ("LifeStyle Funds") under the Plan will be reduced by any amounts payable with respect to the Institutional Class I Shares of each Portfolio in which a LifeStyle Fund invests, pursuant to the Administrative and Shareholder Services Agreement dated July 7, 2000, between the LifeStyle Funds and AGAM. Under the Administrative and Shareholder Services Agreement, Class I Shares are subject to a 0.25% Service fee. In accordance with the Investment Advisory agreement, AGAM, in addition to providing advisory services, provides accounting and administrative services for which AGAM charged $1,404,639 to the Fund, before reimbursement based on expense limitations, for the year ended October 31, 2000. American General Distributors, Inc., and American General Financial Advisors, Inc, received $57,275 and $491,411, respectively, in front-end sales charges, and American General Distributors, Inc., and AGFD received $62,067 and $61,325, respectively, in contingent deferred sales charges during the period. At October 31, 2000, the American General Retirement Plan, a Defined Benefit Pension Plan sponsored by American General Corporation, owned directly or indirectly 92% of the outstanding shares of Core Bond and 98% of the outstanding shares of High Yield Bond. At October 31, 2000, VALIC, an indirect wholly-owned subsidiary of American General Corporation, owned over 5% of the outstanding shares of, Mid Cap Value, Small Cap Growth, Small Cap Index, Socially Responsible, Stock Index, International Equity, Balanced, Municipal Bond, Strategic Income, Money Market and Municipal Money Market. Strategic Income, Money Market, Municipal Money Market, Aggressive Growth LifeStyle, Moderate Growth LifeStyle and Conservative Growth LifeStyle. In addition, at October 31, 2000, one 135 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 5 - continued shareholder owned over 5% of the outstanding shares of Mid Cap Growth and Small Cap Growth, Socially Responsible and Money Market. Aggressive Growth LifeStyle owned over 5% of the outstanding shares of Large Cap Growth, Mid Cap Value, Small Cap Growth and International Equity, Moderate Growth LifeStyle owned over 5% of the outstanding shares of Mid Cap Value. Small Cap Growth and International Equity, and Conservative Growth LifeStyle owned over 5% of the outstanding shares of Mid Cap Value. 6. TRUSTEE'S FEES. The Fund pays each Trustee who is not an employee or a director of the Adviser or its affiliates a fee of $900 plus travel expenses for each Board of Trustees meeting attended and an annual retainer of $3,600. Previously, each Trustee was paid a fee of $750 for each meeting attended, a quarterly retainer of $750, and $200 for each telephone meeting. Prior to July 7, 2000, the Trustees of Mid Cap Value, Science & Technology, Small Cap Index, Socially Responsible, Stock Index High Yield Bond, Municipal Money Market and the three LifeStyle Funds received a fee of $1,000 plus travel expense for each Board of Trustees meeting attended and an annual retainer of $6,200. 7. LINE OF CREDIT. The Fund has entered into an agreement that provides a $20,000,000 Line of Credit to the Fund which may be used for temporary or emergency purposes. The Fund pays a commitment fee of $20,000 annually, and interest is charged on any borrowed amounts at the currently effective Federal Funds Rate plus .55%. This Line of Credit was not used during the year ended October 31, 2000. 8. COMMITMENTS. At October 31, 2000, International Equity, Global Equity and Strategic Income entered into forward foreign currency contracts which contractually obligate the portfolio to deliver currencies at future dates. Open sale and purchase contracts at October 31, 2000, were as follows: FORWARD CONTRACTS
Net Contracts In Unrealized to Exchange Settlement Appreciation Deliver For Date Value (Depreciation) ---------- ---------- ---------- -------- -------------- Global Equity Purchases $219,249 Japanese Yen 23,725,000 11/10/00 $217,431 ($1,818) Sales British Pounds......... 110,506 $160,399 11/06/00 $160,338 $61 British Pounds......... 108,505 157,277 11/07/00 157,277 -- Japanese Yen........... 43,621,935 399,395 11/06/00 399,395 -- ---------- ---------- -------- -------------- $717,071 $717,010 $61 ---------- -------- -------------- ($1,757) -------------- International Small Cap Purchases $15,785 Euro 18,757 11/3/00 $15,917 $132 154,015 Euro 181,285 11/6/00 153,839 (176) 161,007 British Pounds 111,077 11/7/00 161,168 161 ---------- -------- -------------- $330,807 $330,924 117 -------------- Sales British Pounds......... 40,069 $ 57,399 11/1/00 58,138 (739) British Pounds......... 10,082 14,438 11/2/00 14,629 (191) British Pounds......... 13,159 19,107 11/3/00 19,092 15 British Pounds......... 73,140 106,163 11/6/00 106,123 40 British Pounds......... 11,573 16,761 11/7/00 16,792 (31) Japanese Yen........... 4,681,129 42,860 11/6/00 42,901 (41) Swedish Krona.......... 22,495 2,254 11/6/00 2,251 3 ---------- -------- -------------- $258,982 $259,926 ($944) -------------- ($827) --------------
136 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 8 - continued International Equity
Net Contracts In Unrealized to Exchange Settlement Appreciation Deliver For Date Value (Depreciation) ---------- ---------- ---------- -------- -------------- Purchases $23,411 Euro 27,762 11/03/00 $23,559 $ 148 1,922 Euro 2,264 11/07/00 1,921 (1) 42,095 British Pounds 29,394 11/02/00 42,649 554 298,857 British Pounds 205,762 11/06/00 298,550 (307) 5,617 British Pounds 3,872 11/07/00 5,618 1 184,430 Japanese Yen 19,090,404 12/08/00 176,175 (8,255) ---------- -------- -------------- $556,332 $548,472 ($7,860) ---------- -------- -------------- Sales Euro................... 478,000 $403,881 12/08/00 $406,357 ($2,476) Japanese Yen........... 19,090,404 180,746 12/08/00 176,175 4,571 ---------- -------- -------------- $584,627 $582,532 $2,095 ---------- -------- -------------- ($5,765) --------------
9. ACQUISITIONS On July 10, 2000, the certain funds, as listed below, (each an "Acquiring Fund" acquired the assets and certain liabilities of other funds, also listed below, (each an "Acquiring Fund") in tax-free exchanges approved by the shareholders. The number and value of shares issued by the Acquiring Fund are presented in the schedule of Capital Stock Activity (Note 3). Net asset and unrealized appreciation (depreciation) as of the reorganization date were as follows: Acquisition of AGSPC2 Money Market Fund by the North American Money Market Fund: Net Assets of North American Money Market prior to merger....... $19,870,100 Net Assets of AGSPC2 Money market prior to Merger............... $26,406,587 Aggregate net assets of North American Money Market immediately following the acquisition....................................... $46,276,687 Acquisition of AGSPC2 Core Bond Fund and the AGDPC3 Domestic Bond Fund by the North American Core Bond Fund: Net Assets of North American Core Bond prior to merger.......... $9,221,390 Net Assets of AGSPC2 Core Bond prior to Merger.................. $319,450,486 Net Assets of AGSPC2 Domestic Bond prior to Merger.............. $20,971,752 Aggregate net assets of North American Core Bond immediately following the acquisition....................................... $349,643,628 Unrealized depreciation in AGSPC2 Core Bond..................... $7,569,361 Unrealized depreciation in AGSPC2 Domestic Bond................. $213,402 Acquisition of the North American Equity-Income Fund, the North American Tax- Sensitive Equity Fund, and the AGSPC2 Large Cap Value Fund by the North American Growth & Income Fund: Net Assets of North American Growth & Income prior to merger.... $285,707,092 Net Assets of North American Equity-Income prior to Merger...... $64,486,260 Net Assets of North American Tax-Sensitive Equity prior to Merger.......................................................... $4,816,365 Net Assets of AGSPC2 Large Cap Value prior to Merger............ $14,797,818 Aggregate net assets of North American Growth & Income immediately following the acquisition........................... $369,807,535 Unrealized appreciation in North American Equity-Income......... $3,612,632 Unrealized appreciation in North American Tax-Sensitive Equity.. $1,361,977 Unrealized appreciation in AGSPC2 Large Cap Value............... $548,794
137 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 9 - continued Acquisition of AGSPC2 Balanced Fund by the North American Balanced Fund: Net Assets of North American Balanced prior to merger............ $53,829,259 Net Assets of AGSPC2 Balanced prior to Merger.................... $14,526,857 Aggregate net assets of North American Balanced immediately following the acquisition........................................ $68,356,116 Unrealized appreciation in AGSPC2 Balanced....................... $1,064,064 Acquisition of AGSPC2 Municipal Bond Fund by the North American Municipal Bond Fund: Net Assets of North American Municipal Bond prior to merger...... $10,011,129 Net Assets of AGSPC2 Municipal Bond prior to Merger.............. $7,246,516 Aggregate net assets of North American Municipal Bond immediately following the acquisition........................................ $17,257,645 Unrealized depreciation in AGSPC2 Municipal Bond................. $294,879 Acquisition of AGSPC2 International Growth Fund and the AGSPC2 International Value Fund by the North American International Equity Fund: Net Assets of North American International Equity prior to merger........................................................... $24,631,389 Net Assets of AGSPC2 International Growth prior to Merger........ $13,359,036 Net Assets of AGSPC2 International Value prior to Merger......... $15,862,600 Aggregate net assets of North American International Equity immediately following the acquisition............................ $53,853,025 Unrealized appreciation in AGSPC2 International Growth........... $2,221,695 Unrealized appreciation in AGSPC2 International Value............ $3,791,004 Acquisition of AGSPC2 Strategic Bond Fund by the North American Strategic Income Fund: Net Assets of North American Strategic Income prior to merger.... $37,517,037 Net Assets of AGSPC2 Strategic Bond prior to Merger.............. $6,626,303 Aggregate net assets of North American Strategic Income immediately following the acquisition............................ $44,143,340 Unrealized depreciation in AGSPC2 Strategic Bond................. $134,632 Acquisition of AGSPC2 Mid Cap Growth Fund by the North American Mid Cap Growth Fund: Net Assets of North American Mid Cap Growth prior to merger...... $56,193,139 Net Assets of AGSPC2 Mid Cap Growth prior to Merger.............. $19,442,387 Aggregate net assets of North American Mid Cap Growth immediately following the acquisition........................................ $75,635,526 Unrealized appreciation in AGSPC2 Mid Cap Growth................. $2,332,158 Acquisition of AGSPC2 Large Cap Growth Fund by the North American Large Cap Growth Fund: Net Assets of North American Large Cap Growth prior to merger.... $55,136,766 Net Assets of AGSPC2 Large Cap Growth prior to Merger............ $31,612,521 Aggregate net assets of North American Large Cap Growth immediately following the acquisition............................ $86,749,287 Unrealized appreciation in AGSPC2 Large Cap Growth............... $4,904,896 Acquisition of AGSPC2 Small Cap Growth Fund by the North American Small Cap Growth Fund: Net Assets of North American Small Cap Growth prior to merger.... $6,647,129 Net Assets of AGSPC2 Small Cap Growth prior to Merger............ $28,945,756 Aggregate net assets of North American Small Cap Growth immediately following the acquisition............................ $35,592,885 Unrealized appreciation in AGSPC2 Small Cap Growth............... $5,088,462
138 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 9 - continued On July 10, 2000, certain newly established portfolios, as listed below (each an "Acquiring Fund"), acquired the assets and liabilities of certain funds, also listed below (each an "Acquired Portfolio") pursuant to a plan of reorganization approved by its shareholders. The reorganization was accomplished by a tax-free exchange of shares of the Acquiring Fund in an amount equal to the outstanding interests of the Acquired Portfolio.
Acquiring Fund Acquired Portfolio -------------- ------------------ Mid Cap Value AGSPC2 Mid Cap Value Science & Technology AGSPC2 Science & Technology Small Cap Index AGSPC2 Small Cap Index Socially Responsible AGSPC2 Socially Responsible Stock Index AGSPC2 Stock Index High Yield Bond AGSPC2 High Yield Bond Municipal Money Market AGSPC2 Municipal Money Market Aggressive Growth LifeStyle AGSPC2 Aggressive Growth Lifestyle Moderate Growth LifeStyle AGSPC2 Moderate Growth Lifestyle Conservative Growth LifeStyle AGSPC2 Conservative Growth Lifestyle
10. FOREIGN SECURITIES. Investing in securities of foreign companies and foreign governments involves special risks and considerations not typically associated with investing in securities of domestic companies and the United States Government. These risks include revaluation of currencies and future adverse political and economic developments. Moreover, securities of foreign companies and foreign governments may be less liquid and their prices more volatile than those of securities of comparable domestic companies and the United States Government. 11. FUTURES CONTRACTS. Futures contracts outstanding at October 31, 2000 weres as follows:
Net Unrealized Aggregate Expiration Total Appreciation Cost Date Value (Depreciation) --------- ---------- --------- -------------- Socially Responsible S&P Mini 500 Index (Long)...... 886,017 12/15/2000 864,121 (21,896) S&P 500 Index (Long)........... 1,502,163 12/15/2000 1,440,200 (61,963) --------- --------- -------- 2,388,180 2,304,321 (83,859) --------- --------- -------- Stock Index S&P Mini 500 Index (Long)...... 929,435 12/15/2000 936,163 6,726 S&P 500 Index (Long)........... 3,356,188 12/15/2000 3,240,417 (115,771) --------- --------- -------- 4,285,625 4,176,580 (109,045) --------- --------- -------- Small Cap Index Russell 2000 Index (Long)...... 770,525 12/31/2000 750,750 (19,775) S&P Mini 500 Index (Long)...... 69,900 12/15/2000 72,013 2,113 S&P 500 Index (Long)........... 380,913 12/15/2000 360,048 (20,865) --------- --------- -------- 1,221,338 1,182,811 (38,528) --------- --------- -------- International Equity Dax Index (Short).............. 410,671 12/15/2000 453,411 (42,740) --------- --------- -------- 410,671 453,411 (42,740) --------- --------- --------
139 NORTH AMERICAN FUNDS OTHER INFORMATION (Unaudited) - ------------------------------------------------------------------------------- Capital Gain Distributions (Unaudited) Pursuant to Section 852 of the Internal Revenue Code, the distributions set forth below have been designated as capital gains distributions for the fiscal year ended October 31, 2000:
Capital Gain Portfolio Distribution -------------------------------- ------------ Growth & Income................ $32,396,577 Large Cap Growth............... 7,589,304 Mid Cap Growth................. 3,912,751 Mid Cap Value.................. 299,142 Small Cap Growth............... 931,972 Small Cap Index................ 685,194 International Equity........... 4,677,750 International Small Cap........ 702,814 Aggressive Growth LifeStyle.... 2,752,224 Moderate Growth LifeStyle...... 1,729,036 Conservative Growth LifeStyle.. 1,333,892
140 NORTH AMERICAN FUNDS 286 Congress Street, Boston, MA 02210 www.northamericanfunds.com [VARIOUS FUND COMPANY LOGOS ARE SCREENED IN BACKGROUND] 151 NAF 1000:90310 -----END PRIVACY-ENHANCED MESSAGE-----